rmb 2010-12 batch lectures

7/28/2019 RMB 2010-12 Batch Lectures

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Business Research Methods



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• When Columbia Pictures Industries, Inc., was planning the

promotion for its new movie Starman, it had to decide howmuch to spend for advertising the movie and when theadvertising should occur.

• "One of Columbia's biggest marketing weaknesses in thepast was to spend too much in advertising its films .... It

now carefully tracks the effects of its spending in twice-a-week polls of moviegoers.

• "(Columbia's marketing vice-president) believes that amovie that opens nationally like Starman should be knownby at least 60% of the public by opening day. In the weeksbefore such a movie's release, his department tracksawareness of the film-by region, age group, and sex. If awareness builds faster than expected, Columbia cuts back its promotion .... If it doesn't pick up fast enough, spendingis increased.”

Situation I :Adv. Decision



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Situation II: Adv. Decision

• The A&P food store chain introduced a new nationwide advertising

campaign to show consumers its stores were clean, were staffed byfriendly employees, and were well stocked with fresh food offered at value

prices.

• "These commercials are the product of a variety of surprisingly extensivemotivational research techniques .... Consumers were shown a simplesketch of a woman about to enter a supermarket. They were asked what

the woman was thinking and how she felt. In another test, subjects wereshown photographs of people, told they depicted both A&P customers andthose who shopped elsewhere, and were then asked to separate thepictures into two groups and explain why. Some subjects were also askedto imagine A&P as a person: Is it a man or a woman; what kind of workdoes he or she do?

• "The results were not the stuff of happy A&P marketing conferences. Thetests showed that consumers considered supermarket shopping to bedrudgery and that the A&P chain, in particular, was seen as agrandmother who is a bit corny and behind the times. Perhaps worse, itsstores were considered more expensive and less efficient than thecompetition's."



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Situation III

• Although the United States represents the largest travel marketin the world, only 2 percent of the country's travelers go toCanada for vacations. To learn why so few American travelersvisit Canada, the Canadian tourism bureau interviewed 9,000 Americans who vacationed regularly. What emerged from thesehour-long, in-home interviews was " ... the general perception of Canada as clean, safe, and dull, with immense stretches of wilderness broken up by cities that closed down at 5 PM. Atypical comment was, 'Canada doesn't present itself as anexciting place, with a lot of activity like New York .... or Californiafor the craziness. There's nothing I can identify with Canada. It's just. ... Canada.'"

• What resulted from the research was a $14 million advertisingcampaign " .... to jazz up Canada's public persona. Out went themoose and the mountains and in came the nightclubs,Broadway-type theaters, Old World architecture, French citiesand sports opportunities."



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Situation IV: Adv. Decision• Diet Rite had less than a 1 percent market share, which was much

smaller than either Diet Coke or Diet Pepsi. "Diet Rite had tried ads that pushed taste, lower price, even its low calorie content, but had not found an effective way to distinguish the product from its

powerful competitors'. It was looking for an emotional hook.

• "So Diet Rite's agency ... began by interviewing dozens of women

who were dieters. The interviewers, clinical psychologists,reported that these women were convinced their bodies wereunattractive, or they used food for a substitute for a balanced

family life, or they were raised in homes where food was used as a punishment or reward. All said they felt dieting was difficult andmade them feel more vulnerable.

• "On the basis of these interviews (the agency) recommended thatthe Diet Rite campaign not show gorgeous women in skimpybathing suits because women with poor self-images could notrelate to them. The agency also decided that viewers would empathize with other dieters who appeared vulnerable and

hardworking."



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Situation V: New Product

Development• When the Campbell Soup Co. first developed

Juice Works, a line of fruit juices for children,

" ... 200 students in elementary schools inNew Jersey helped Campbell develop thenew drinks by tasting and rating them. Onscorecards filled with drawings of faces, the

children gave the early samples low marks-alot of frowns and children hold ing their nosesand signaling thumbs down. Campbell

modified the recipes until the scores

improved."



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Introduction to Research

Research is the process of finding solutions toa problem after a thorough study and

analysis of the situational factors



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Business research

• It can be defined as a systematic and

objective process of gathering, recording

and analyzing data that provides

information to guide business decisions.

• It is used to understand the market trends.

• To find out the optimal marketing mix,

devise effective HR policies, or to find the

best investment options.



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Basic research

• Basic research refers to focused systematicstudy or investigation undertaken todiscover new knowledge and establish facts

or principles in a particular field.• It is primarily aimed at gathering

knowledge.

Eg:• Understanding the consumer buying process

• Examining the consumer learning process.



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Applied research

• It refers to investigation undertaken to discover theapplications and uses of theories, knowledge and principles in actual work or solving problems.

• It is used to answer a specific question, determine

why something failed or succeeded, solve a specific problem.

For eg:

• Evaluating the impact of a training program onemployee performance

• Examining consumer response to direct marketing programs



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Some more types of research…..

• Exploratory research

• Descriptive & Analytical research

• Quantitative & Qualitative research

• Conceptual & Empirical research



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Why is it important for managers to know

about research?

• Solve problems

• Decision making tool

• Competition

• Risk

• Investment



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Why Business/Marketing Research

has evolved and grown• Managers are separated from their final consumers.

• They need information from their final consumers.

– Target Market

– Product & Services

– Price

– Distribution

– Promotion



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What is Marketing Research

• ….is the process of designing, gathering, analyzing, andreporting information that may be used to solve aspecific marketing problem. (Burns & Bush)

• …is the function that links the consumer, customer,and public to the marketer through information — information used to identify and define marketingopportunities and problems; generate, refine, andevaluate marketing actions; monitor marketing

performance; and improve the understanding of marketing as a process. (AMA)



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Market Research during different phases of

administrative process

Evaluating the plan’s effectiveness

Putting the plan in action

Developing a plan

Setting goals and Establishing strategies Phase I

Phase II

Phase III

Phase IV



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Factors affecting Business Research

• Time constraint

• Availability of resources

• Nature of information sought

• Benefits versus costs



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Business Research Process

Problem & Objective Formulation

Research Proposal & Hypotheses Formulation

Research Design & Methods

Select sample procedure

Data collection

Analysis & interpretation of data

Research Report



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Problem Formulation

Research Problem refers to some difficulty which is impacting

towards negativity on the business or Management and requires best solution.

Components of research problem are:

1) There must be some objective to attain.2) There must be alternative means for obtaining the objective, i.e.,

there must be more than one problem which can lead togeneration of objective.

3) There must be some doubt in the mind of researcher as to the

selection of alternative. i.e. researcher must know that which problem is effecting more to the business.



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Establishing the objective

After defining the problem, next stage is of establishing the objective.

Defining of Objective is the most critical stage, as whole research is to

be conducted to the objective.

Example: the scope for brining about lasting changes in attitude by

means of training programs.

(Problem: prior to objective that Projects are not completing on timeor conflict level is increasing)



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Sources of Problem

1) Reading: reading critical articles related to the problemscenario.

2) Experience: Experienced researchers can understand the

scenario and can formulate problems easily.

3) Exposure to field situations: Researcher has to visit field andsometimes has to do internship to understand the market

closely and practically.

4) Consultation to experts: discuss scenario to Experts and

Business executives. Business executives interacts more tocustomers so can understand market easily.

5) Brainstorming: discussing among the group about the case.



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Process of Identification of Problem

1) Selecting the discipline: Specify in which discipline research is to

be done. Like: Marketing, Finance, HR, Operations, Economics

etc…

2) Particular aspects of the selected subject: Here concentration is

more into the area of discipline which has been specified.

3) Identification of two or more specific topics in the selected

broad area: This stage requires grasp of the area and awareness

about the related problems and work which already has been done.

(Sources of problem can be used on this stage)



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Criteria of Selection

• Internal Criteria

– Researcher’s interest

– Researcher’s competence

– Researcher’s own resources

• External Criteria

– Researchability: Problem should be researchable

– Importance & Urgency

– Novelty or Originality

– Feasibility

– Usefulness and Social relevance



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Management Research Question Hierarchy

Discover the Management Dilemma

Discover the Management Question

Discover the Research Question

Refine the

Research Question ExplorationExploration

Stage 1 of Research Process



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Formulating the Research Question

Discover

ManagementDilemma

Identify symptoms rather

than problems

Exploration

Review published sources and interview

information to understand true dilemma.

Discover

Management

Question

Using collected exploratory

nformation to word the dilemma into question

Exploration

Clarify the possible management action that

might be taken to solve the dilemma.

Define

Research

Questions

Several management questions may be taken here.

Each question is an alternative action that may be used to

solve the dilemma



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Selecting between specific alternatives

under consideration

• Using Typical Research and then results

will tell about the research question out of

available questions• Research from the past behavior and

including some Quantitative techniques to

research further. (Decision tree analysis)



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Research Proposal

Research Proposal is a blue print for conducting and controlling

research. It is considered as a research plan to serve as a mean of communication between the researcher and the research supporter.

Purpose of Research Proposal

◙ Need of the particular research

◙ Beneficiaries of research

◙ Kind of data to be collected and the means

◙ Type of analysis that will be done

◙ Duration, facilities, and funds required to carry out the research

◙ Credentials of the proposals



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The Content of Research Proposal

◘ Executive Summary

◘ Research Questions & Objectives

◘ Literature Review

◘ Hypotheses Generation

◘ Importance/Benefits of the Study

◘ Research Design/Method

◘ Time scale and Budget

◘ Data Analysis

◘ Bibliography and Appendices



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Developing the hypotheses

• It is a statement based on some presumption

about the existence of a relationship

between two or more variables that can betested through empirical data.

• When a researcher is developing a

hypothesis, he/she will assume an answer for a particular research questions and then

test for its validity.



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Developing the hypotheses

• A hypothesis makes the research question

clearer to the researcher.

• For eg: if the research question is “why arethe sales of refrigerators going up during

winters?”

• In this case the hypothesis could be “ thesales of refrigerators are going up during

winters during off season discounts”



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2) Relational

– Statements that describe the relationship

between two variables with respect to somecase

– Foreign (variable) refrigerators are perceived to

be of better quality (variable) by Indian

consumers (case)

Types of Hypothesis



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Research Hypothesis

Hypotheses is the tentative proposition whose validity remains to be

tested.

Example : Sale of cars is decreasing.

Types of Hypotheses

1) Descriptive Hypotheses: Propositions that describes the characteristics

(Size, form or distribution) of a variable like object, person, organization,

situation or event.

Ex.: “The rate of unemployment among non graduates is higher than that of graduates”

“ 80% shareholders of HLL favour increasing the company’s cash dividend”

Can also be stated as research question

– Do shareholders of HLL favour an increased cash dividend?



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• Two types: Correlation & Causal

• Correlation

– Merely states that variables occur together without implying that one causes the other

• People in Kerela give more importance to educationthan people in Punjab

• In an office old employees are more responsive thanyoung employees

Types of Relational Hypothesis



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• Causal (or Explanatory)

– There is an implication that existence of

(or a change in) one causes or leads to achange in the other

• Causal variable is called Independentvariable and the other Dependent variable

• Advertisement causes higher sales

• Increase in income leads to higher savings

Types of Relational Hypothesis



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3) Working Hypotheses: initial statements while planning, which are to be

validated.

4) Null Hypotheses: These are hypothetical statements denying what are

explicitly indicated in working hypotheses. They state that no difference

exist between the parameter and the statistics

5) Statistical Hypotheses: Statements about statistical population andderived from a sample.

Like number of components from any machine

6) Common-sense Hypotheses: Empirical uniformity perceived through

day-to-day observation.

S f H h



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Sources of Hypotheses

Hypotheses can be derived from various sources:

1) Theory: It gives direction to research by stating what is known.

Ex: “Higher the earning per share, more favorable is the financial leverage”

“The optimum capital structure is the combination of debt and equity which

leads to the maximum value of the firm”

2) Observation

3) Personal Experience

4) Finding of Studies

5) State of knowledge

6) Culture7) Continuity of research



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Characteristics of a Good Hypotheses

• Conceptual clarity• Specificity

• Testability

• Availability of techniques

• Consistency

• Objectivity

• Simplicity



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Hypotheses Development

Rules for constructing Hypotheses:

1) Link two or more formal propositions through a shared

independent or dependent variables where possible.

2) Analyse variables through their relationship

3) Always consider alternative operations that might be more

appropriate for a given variable



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Testing of Hypotheses

▪

Validation of Research testing is required.▪ For testing Hypotheses has to be assumed.

▪ In hypotheses no prior facts are being considered, however they

come systematically. But these facts are used in our hypotheses

only after testing.▪ Attitude of researcher: He should not be biased for the hypotheses

generated by him infect should use scientific methods to validate

the hypotheses.

▪

Testing process of hypotheses forms the major part of research process. It consists of operationalization of the concepts, statistical

analyses of data and drawing inferences from the results.



Using Secondary Data

Secondary data: information that has previouslybeen gathered by someone other than the

researcher and/or for some other purposethan the research project at hand



Classification of Secondary Data

• Internal secondary data: data that have been

collected within the firm .

• Internal databases: databases (collection of data

and information describing items of interest)consisting of information gathered by a companytypically during the normal course of businesstransactions

e.g.: • Salesperson’s call reports

• Salesperson’s expense accounts

• Product features etc…



Classification of Secondary Data…cont.

• External secondary data: data obtained fromoutside the firm

• Types:

• Published: sources of information prepared for

public distribution and found in libraries or a varietyof other entities

• Syndicated Services Data: data provided by firmsthat collect data in a standard format and make themavailable to subscribing firms

• External Databases



Classification of Secondary Data…cont. Types of External Secondary Data

• External secondary data

• External Databases: databases provided byoutside firms; many are now available online(online information databases)

• Bibliographic databases..citations bysubject, i.e. ABI Inform

• Numeric or statistical databases, 2007 Census

• Directory or list databases, AMAmembership list

• Comprehensive databases, Contain all of the above



Advantages of Secondary Data

• Obtained quickly (compared to primary datagathering)

• Inexpensive (compared to primary datagathering)

• Usually available

• Enhances existing primary data



Disadvantages of Secondary Data

• Mismatch of the units of measurementNeed daily data yet only monthly available, need incomes of $75,000 and over only available $50,000 and over

• Differing class definitions used – Need users “inbetween” heavy, medium or light users

• Timeliness (how current is the secondary data)

• Lack of information needed to assess the

credibility of the reported data

Diff t t f j f d



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Different types of major sources of secondary

dataDocumentary

• Written Material

Example: Organization's records such as personnel or production

Organization’s communication such as notes, e-mails,

letters, reports of committees, books, journals, newspapers.

• Non-Written Material

Example: Media accounts including television and radio Taped

interviews, Videotaped observations.

Multiple sources

• Area based

Example: Financial times country reports, Govt. publications, Journals

• Time series based

Example: Industry statistics & reports

Census of population & employment

Diff t t f j f d



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Different types of major sources of secondary

data (Contd.)Survey

• Census

Example: Govt. Census: Census report of population & employment

• Continuous and Regular survey

Example: Govt. survey, General household survey

Organization Employee Attitudes

• Ad hoc surveys

Example: Govt. Surveys, Organizations survey, Academic survey



Locating Secondary Data Sources

•

Step 1: Identify what you wish to know and whatyou already know about your topic.

• Step 2: Develop a list of key words and names.

• Step 3: Begin your search using several libraryand Web sources.

• Step 4: Compile the literature you have found andevaluate your findings.

• Step 5: If you are unhappy with what you havefound or are otherwise having trouble and

the reference librarian you contact has notbeen able to identify sources, use anauthority (if available).

• Step 6: Report results.



Evaluating Secondary Data

• What was the purpose of the study?

• Who collected the information and when was this

done?• What information was collected (questions,

scales, etc.)?

• How was the information obtained (samplingframe, method of sample draw, communication

method, resulting sample, etc.)?• How consistent is the information with other

published information?



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Evaluating secondary data

1) Overall Suitability

• Does the data set contains the information you require to

answer the questions and to meet the objectives?

• Do the measures used match those you require?

• Does the data set cover the population that is the subject of

your research?

• can the useful data be separated from the unwanted data?

• Are data available for all the variables of research?



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2) Precise Suitability

• Reliability of data

• is the methodology clearly described?

• if sampling was used then what was the sample size,

procedure for finding sampling, sampling errors, and

response rate?

• Is copy of questionnaire and interview checklist available?

• does researcher is clear about that how data is analysed

and complied• data is compatible for your research or not?



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3) Cost and benefits

• Financial and time costs of obtaining the data

• whether data is computer friendly or not?

• Do the overall benefits of using this secondary data source

outweigh the associated costs?

• At the time of assessing cost and benefits of secondary

data, then one thing should be kept in mind that secondary

data is not always reliable and can not always give

appropriate results as expected by researcher.

rmb 2010-12 batch lectures

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