1.1 business research methods

Calicut university, Business research methods, 5th semester

1. BCM5B08 BUSINESS RESEARCH METHODS Module 1 5th Semester B. Com Finance University of Calicut Prepared By: Ms. Leena K P Don Bosco College, Mannuthy

2. Objective To enable students for acquiring basic knowledge in business research methods and to develop basic skills in them to conduct survey researches and case studies

3. Syllabus MODULE 1 : Business Research : Definition and Significance – Features of business research – The research process – Variable – Proposition – Types of research – Exploratory and Causal research – Theoretical and empirical research – Basic and applied research – Descriptive research – Phases of business research – Research Hypothesis – Characteristics – Research in an evolutionary perspective – Role of theory in research – Theory building – Induction and Deduction Theory.              (10 Hours, 15 Marks)

4. “All Progress is born of inquiry. Doubt is often better than overconfidence, for it leads to inquiry and inquiry leads to invention” - Hudson Maxim

5. What is Research? A systematic search to acquire knowledge A systematic method of finding solutions to problems “Re” and “Search”, i.e., Search and search again A careful study to discover correct information or a way of collec ting information to facilitate problem solving It refers to the systematic method consisting of enunciating the problems, formulating hypothesis, collecting facts or data, analysing them and reaching certain conclusions either in the form of Solution or certain generalisations for some theoretical formulation

6. Research - Definitions: “A careful critical enquiry or examination in seeking facts or principles; diligent investigation in order to ascertain something” – Webster’s International Dictionary “Research is essentially an investigation, a recording and an analysis of evidence for the purpose of gaining knowledge.” – Robert Ross “The systematic and objective analysis and recording of controlled observations that may lead to the developments of generalizations, principles or theories, resulting in prediction and possible ultimate control of events. “

7. Features of Research Discovery of new knowledge An investigation Related with solution of a problem For predicting future occurrences Based on observation or experimental evidences Demands accurate observation or experimentation Involves collection of data  used for new purpose Requires expertise Patience Carefully recorded and reported

8. Research - Definitions: “A careful critical enquiry or examination in seeking facts or principles; diligent investigation in order to ascertain something” – Webster’s International Dictionary “Research is essentially an investigation, a recording and an analysis of evidence for the purpose of gaining knowledge.” – Robert Ross “The systematic and objective analysis and recording of controlled observations that may lead to the developments of generalizations, principles or theories, resulting in prediction and possible ultimate control of events. “

9. Business Research ➔ An important sub-sector of research ➔ Undertaken to resolve issues in the areas of accounting, finance, marketing and management ➔ Always customer oriented ➔ Research is needed to identify the strength and weakness of business ➔ Business research is any type of research used to identify investment oppo rtunities or start a business or succeeding improvement. ➔ It is done at the time of starting or running of any kind of business ➔ Mission of business research – Generate precise information for decision making

10. Business Research- Definition “ Business Research is the planning, collection and analysis Of data relevant to business decision making and Communication of the results of this analysis to management” Mc Danial and Gates

11. Business Research The application of the scientific method in searching for the truth about business phenomena. These activities include defining business opportunities and problems, generating and evaluating ideas, monitoring performance, and understanding the business process. This process includes idea and theory development, problem definition, searching for and collecting information, analyzing data, and communicating the findings and their implications.

12. Business research is a process of acquiring detailed information of all the areas of business and using such information in maximizing the sales and profit of the business. Such a study helps companies determine which product/service is most profitable or in demand. In simple words, it can be stated as the acquisition of information or knowledge for professional or commercial purpose to determine opportunities and goals for a business. Business research is a field of practical study in which a company obtains data and analyzes the same to manage the company better. Executives and managers who use business research methods can better understand their company, the position it holds in the market, and how to improve that position.

13. Definitions “Business research is the application of scientific method in searching for the truth about business phenomena.” – Zikmund W. G “Business research as systematic and objective analysis of controlled observations that may use to the development of organisational, principles and possibility of ultimate control of events” – John W. Best “Business research is a systematic inquiry that provides information to guide management decisions. It is the process of planning, acquiring, analysing and disseminating relevant data, information and insights to decision makers in way that mobilise the organisation to take appropriate action that in turn maximise performance “ - Cooperet

14. Features of Business research Systematic and objective process Business research has a clear objective purpose Business research is multi disciplinary Covers all the region in which the business operates, locally and internationally Judging local problems of the environment Accurately determines the cost or profitability of a business Flexibility Use of internet Focused on demand Discovery of new knowledge Time constraints …

15. GROWTH ANALYSIS ROLE IN DECISION MAKING

16. To promote business in an economically sound manner To ensure future success Gather relevant information for smooth conduct of business To determine the players in the market Helps the management to identify and solve small problems To save time and cost Facilitate managerial decision making process Purpose/Objectives of Business Research

17. Business Research Methods-Meaning Business Research methods may differ according to size of company and type of information required A business research method is a vigilant and diligent study of a market an industry or a particular company’s business operations, using investigative techniques to discover facts, examine theories or develop an action plan based on discovered facts.

18. Important Business Research Methods Operational Research ➔ A study of a firm’s operational systems identifies each production step ➔ This type of research helps a firm to reduce waste, inefficiency and poor performance by examining procedures on a step-by-step basis Case Studies ➔ Cases studies allow investigation of industries , companies and business situations. ➔ This type of research can uncover business trends and strategies Statistical Data ➔ Examination of information and statistical data is another method of research ➔ Financial data helps to evaluate performance and predict trends ➔ Industry data and competitor analysis help to determine when the products and services of a company will penetrate a market

19. Interview Design ➔ Consumers are directly asked to answer a series of questions that express their level of satisfaction 5 . Listening This is an important method of business research if personnel are trained Properly to understand what customers are saying and properly relay that to management 6. Questionnaire and Questioning ➔ Through this way also, data can be collected from consumers. ➔ The questions should be easy to read, understand and answer. 7 . Surveys and Focus groups

20. Importance of Conducting Business Research 1. Job Seekers Conduct business research to know more about the company, its status, payment done etc 2. Investors Need information to ensure safety of their investments 3. B2B Providers They use research to formulate marketing strategy 4. Philanthropic Organisations Before making huge donations , the philanthropist will conduct research about the charitable organisations to which they donate funds and in-kind resources 5 . Companies They conduct business research for many reasons: Testing New Products , Ensuring Adequate Distribution , Measuring Advertising Effectiveness , Studying the Competition

21. Functions of Business Research To find out things about business in a systematic way To generate new ideas and concepts All time Every employee has potential Should be a part of business Management tool  Descriptive, Diagnostic, Predictive Function Source of information  Internal or external Redefining perceptions  By assessment Risk management  Provide parameters to flourish business and manage risk Shape strategies  Competitor, consumer analysis

22. Benefits To know economy better Problem solving Decision making Meet future demand and supply needs Budgeting Market analysis Forecasting Policy making of Governement

23. When to conduct research?

24. Research Process Tentative or temporary selection of the research problem Initial survey of literature Finalising or selecting the research problem Extensive literature survey Developing the hypothesis Preparation of research design Determination of sample design Collecting data Execution of the project Analysis of data Testing of hypothesis Generalisations and interpretations Preparation of report and presentation of results

25. Types of Research 1. Descriptive research ( Ex post facto research) I ncludes surveys and fact-finding enquiries of different kinds. The researcher has no control over the variables; he can only report what has happened or what is happening Include attempts by researchers to discover causes Example: Frequency of shopping, preferences of people  Survey methods 2. Analytical research  T he researcher has to use facts or information already available, and analyze these to make a critical evaluation of the material.

26. 3. Applied research (Action) aims at finding a solution for an immediate problem facing a society or an industrial/business organization. Example: Research to identify social, economic or political trends that may affect a particular institution or research to find out whether certain communications will be read and understood or the marketing research or evaluation research 4. Fundamental research (Basic/Pure) is mainly concerned with generalisations and with the formulation of a theory. Directed towards finding information that has a broad base of applications and thus, adds to the already existing organized body of scientific knowledge “Gathering knowledge for knowledge’s sake” Example  Research concerning some natural phenomenon or relating to pure mathematics

27. 5. Quantitative research is based on the measurement of quantity or amount. It is applicable to phenomena that can be expressed in terms of quantity. 6. Qualitative research , on the other hand, is concerned with qualitative phenomenon, i.e., phenomena relating to or involving quality or kind. For instance, when we are interested in investigating the reasons for human behaviour . 7. Conceptual research is that related to some abstract idea(s) or theory. It is generally used by philosophers and thinkers to develop new concepts or to reinterpret existing ones. 8. Empirical research relies on experience or observation alone, often without due regard for system and theory. It is data-based research, coming up with conclusions which are capable of being verified by observation or experiment. Empirical research is appropriate when proof is sought that certain variables affect other variables in some way.

28. 9. one-time research  T he research is confined to a single time-period 10. Longitudinal research  T he research is carried on over several time-periods. 11. Clinical or Diagnostic research  Such research follow case-study methods or indepth approaches to reach the basic causal relations. Such studies usually go deep into the causes of things or events that interest us, using very small samples and very deep probing data gathering devices. 12. The objective of exploratory research is the development of hypotheses rather than their testing 13. Formalized research studies are those with substantial structure and with specific hypotheses to be tested.

29. 14. Historical research is that which utilizes historical sources like documents, remains, etc. to study events or ideas of the past, including the philosophy of persons and groups at any remote point of time. 15. Field-setting research or Laboratory research or Simulation research , depending upon the environment in which it is to be carried out. 16. Conclusion oriented research , a researcher is free to pick up a problem, redesign the enquiry as he proceeds and is prepared to conceptualize as he wishes. 17. Decision-oriented research is always for the need of a decision maker and the researcher in this case is not free to embark upon research according to his own inclination. Operations research is an example.

30. Phases of Business Research Problem Definition Development of an approach to the problem Research Design formulation Data Collection Data Preparation and analysis Report preparation and presentation

31. 1. Identifying and defining the problem/opportunity There will be problems in every field of business like accounting, finance, marketing etc. Broader to specific  what is to be researched Precedes problem definition stage Definition is done by management Problem/opportunity?  Early identification by manager To define problem properly Determine the nature of research Causal, experimental, Applied etc.

32. 2) Preliminary Analysis using: Situation Analysis: Circumstances under which research is taken up Informal investigation: Discussion with selected customers, dealers, others parties concerned Problem definition  Consists of discussion with decision makers, interview with experts, analysis of secondary data etc. Gives direction to research, optimum utilization of resources, helps collect relevant information

33. 2. Development of an Approach to the problem Formulating research objectives Precise Act as guidelines in every step in research process Brief and specific Limit the no. of objectives Comprise the research question/s and the hypothesis B) Developing theoretical framework It demonstrates an understanding of theories and concepts that are relevant to the topic of research The researcher can determine which variable to study

34. C) Analytical Models  Is a set of variables and their interrelationships designed to represent , in whole or in part, some real system or process. Provide a representation of the relationships between variables Act as a guide for formulating research design Analytical models can be : Verbal- Prose Graphical- Visual Mathematical model- Equation D) Research Questions Refined statements of the specific components of a problem A question that a research project sets out to answer

35. E) Developing Hypothesis Research questions are further refined to hypothesis Hypothesis suggests which variables are to be included in the research design

36. 3) Research design Formulation/Planning Blueprint for fulfilling the objectives and answering questions Master pan  Specify the methods, procedures for collecting and analysing the required information by considering the time, staffs, techniques of data analysis etc. Experienced researcher has greater advantages Firm foundation of research study

37. 4. Data Collection Called field work Observation, Survey, experiment Questionnaires, standardised tests, observational forms  Devices Two phases Pretesting  With small sub sample Main study

38. 5. Data Preparation and Analysis Reducing the data to a manageable size Expert assistance required FOUR Stages Editing Coding Classification Tabulation

39. 6. Report Preparation and Presentation Functions: Organised /systematic and permanent form of report  future research Know quality of work done Helps policy makers Importance: Communication Evaluation of success Reveals researcher’ ability Policy and decision making

40. Variable Meaning  Changing, changeable An entity that can take on different values It can take on different values Ex: Sales, Profit Attribute  Constant  Names, Telephone numbers  Specific value on a variable: Gender : Male, Female, Others Types of Variable: Dependent variable Independent variable Intervening variable Moderate variable

41. 1. Dependent Variable The variable that depends on other factors that are measured. These variables are expected to change as a result of an experimental manipulation of the independent variable or variables. It is the presumed effect . 2. Independent Variable The variable that is stable and unaffected by the other variables you are trying to measure. It refers to the condition of an experiment that is systematically manipulated by the investigator. It is the presumed cause .

42. 3. Intervening Variable An  intervening variable  is a hypothetical variable used to explain causal links between other variable. Intervening variables cannot be observed in an experiment (that’s why they are hypothetical). For example, there is an association between being poor and having a shorter life span. Just because someone is poor doesn’t mean that will lead to an early death, so other hypothetical variables are used to explain the phenomenon. These intervening variables could include: lack of access to healthcare or poor nutrition.

43. 4. Moderating Variable The term  moderating variable  refers to a variable that can strengthen, diminish, negate, or otherwise alter the association between independent and dependent variables. Moderating variables are useful because they help explain the links between the independent and dependent variables. Also sometimes referred to as simply moderators, these moderating variables provide additional information regarding the association between two variables in quantitative research by explaining what features can make that association stronger, weaker, or even disappear.

44. Hypothesis Hypothesis is considered as an intelligent guess or prediction, that gives directional to the researcher to answer the research question. • Hypothesis or Hypotheses are defined as the formal statement of the tentative or expected prediction or explanation of the relationship between two or more variables in a specified population.  A hypothesis is a formal tentative statement of the expected relationship between two or more variables under study. A hypothesis helps to translate the research problem and objective into a clear explanation or prediction of the expected results or outcomes of the study. Hypothesis is derived from the research problems, literature review and conceptual framework.

45. Types Descriptive Hypothesis Relational Hypothesis Working Hypothesis Null Hypothesis Analytical Hypothesis Statistical Hypothesis Common-sense Hypothesis

46. Characteristics of hypothesis: Hypothesis must possess the following characteristics: ( i ) Hypothesis should be clear and precise. (ii) Hypothesis should be capable of being tested. (iii) Hypothesis should state relationship between variables, if it happens to be a relational hypothesis. (iv) Hypothesis should be limited in scope and must be specific (v) Hypothesis should be stated as far as possible in most simple terms so that the same is easily understandable by all concerned (vi) Hypothesis should be consistent with most known facts i.e., it must be consistent with a substantial body of established facts (vii) Hypothesis should be amenable to testing within a reasonable time (viii) Hypothesis must explain the facts that gave rise to the need for explanation. It must actually explain what it claims to explain; it should have empirical reference.

47. Induction and Deduction Theory