Topic  Research in

Business
1
LEARNING OUTCOMES
By the end of this topic, you should be able to:
1. Define the meaning of research and the different types of
research;
2. Discuss the criteria of quality research;
3. Assess the responsibilities of a researcher and the user/sponsor
of the research; and
4. Examine the needs to acquire skills to do research.

 INTRODUCTION
Research provides us with the knowledge and skills needed to help us in making
decisions in an environment that changes very rapidly. The term “research,”
however, is sometimes loosely used to mean the way data is collected. Politicians
often say they formulate policy based on research; news agencies often tell us
of their research findings; while marketers highlight the results of their research
findings to make consumers believe in the products they are selling. However,
all these only indicate the wide range of meanings of the term “research” in
everyday usage. From the perspective of research methodology, the everyday
uses of the term do not relay the true meaning of the word.

In research, data collection is an integral part of the decision-making process. If

it is not undertaken in a systematic way, on its own and with a clear purpose, it
will not be seen as research. While data may be collected in many different ways
and from a variety of sources, assembled in a single document and the sources
identified, it is still not considered a research if the data are not interpreted. Thus,
research has the following characteristics:
(a) Data is collected systematically.
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(b) Data is interpreted systematically.

(c) There is a clear purpose.

Therefore, research is something which people undertake to find out something

in a systematic way, thereby increasing their knowledge. Two important aspects
of research are that it is systematic and aims to find out things. Systematic implies
that research must be undertaken using logical relationships and not just beliefs.
Systematic and logical relationships involve an explanation of the methods
used to collect data, giving the reasons and meaning of the results obtained and
clearly explaining any limitations that affected the results. To find out things
suggests that the purposes of doing research may be multiple. These may include
describing, explaining, understanding, criticising and analysing. Nonetheless,
a clear purpose and a set of things to be found out can provide answers to a
question or a number of questions in the research process.

1.1 MEANING OF RESEARCH AND DIFFERENT

TYPES OF RESEARCH

activity 1.1

What is research? Why should there be any question about the

definition of research?

Business research covers a wide range of functional and disciplinary areas.

Commercial organisations conduct research within the functional areas of an
organisation in order to improve business performance. Meanwhile, academics
conduct research to investigate research questions arising from a specific
academic discipline within the context of the business environment.

In commercial research, a marketing manager conducts a market research to

identify customers’ satisfaction on a specific product that the company is selling.
In this research, the marketing manager investigates issues concerning the interest
of the company and the ultimate objective is to help company to make profit.

In academic research, usually a gap is identified in the literature and this gap
reflects the lack of knowledge or limitations in the current body of knowledge
within a discipline. As a result, the objective of conducting a research is to
generate new knowledge to fill the gap. Academic disciplines in business include
human resource management, marketing, finance, accounting, organisational
behaviour, operations management, strategy, etc. For example, an operations
 TOPIC 1  RESEARCH IN BUSINESS  3

management researcher would be interested to study the impact of implementing

a balanced scorecard in companies. In this academic-based research, the
researcher is likely to discover important management knowledge that can also
be used to improve the performance of other organisations.

In general, there are three types of investigations in research (Figure 1.1).

Figure 1.1: Types of investigation in research

(a) Experiment
In this method, a researcher will manipulate an independent variable in
order to determine whether it has an impact on a dependent variable.
There are two types of experiments: laboratory experiment and field
experiment. Laboratory experiment is conducted in a contrived situation
while field experiment is conducted in a real-life situation. In any
experiment, the factors are controlled (set constant) and only one factor is
allowed to fluctuate so that its effect on the other factors could be seen. An
experiment has very high internal validity.

(b) Survey
A survey is a method which investigates the opinions and feelings
of people. It involves interactions between the researcher and the
environment. Information is collected through questionnaire or interview
in many cases. Information collected in this way may not be available
under any other circumstances. The relationship between the variables
discovered through a survey research does not represent a causal
relationship. The researcher can only claim that these variables are
correlated. They cannot be certain that there is causation between the
variables. Thus, the survey method has lower internal validity than an
experiment.
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(c) Case study

In this method, a researcher makes a detailed study of a single case. The
researcher usually aims to provide in-depth understanding of the specific
features of the case and its related settings. Data are collected through
observation, interview and document search. There are many concerns
regarding the external validity of the case study method. One of them is
– How could a single case be generalised or represent many more cases?
However, many case-based researchers try to study a few cases in order
to claim theoretical generalisation. Other researchers argue that unlike the
survey method, generalisation is not the purpose of the study. In a survey,
researchers generalise the findings to a larger population. In a case study,
researchers seek to discover in-depth features of the case which cannot be
acquired under any other circumstances.

1.2 IMPORTANCE OF HAVING RESEARCH

SKILLS
Individuals can benefit from having research skills because:

(a) To make decisions, a manager needs information before selecting a course

of action. The manager can delegate the collection of information to other
people but this may be costly and limited if there is no one skilful enough
to do it. The manager can make intuitive judgements but with risks. He
can collect the data if he has some level of skills.

(b) As a new staff, an employee may be asked to carry out research for a
higher-level executive. This could be an opportunity for him to boost his
career and give a good impression if he has research skills and abilities.

(c) At times, an employee may be asked to evaluate research proposals

from people outside the organisation. If he can understand the process
of doing research and the research design, he can review the quality of
the proposals and help the organisation in selecting the proposal that best
meets the needs of the organisation, thus helping to save the organisation
both money and time.

(d) Information that is useful to decision-makers is normally obtained as

findings in a research project. With research skills, an individual could
help the organisation by determining the applicability of the information
from previous research to resolve existing problems faced by the
management.
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(e) Individuals who are aware of the range of research methods available
would be able to choose a suitable method to collect and analyse data in a
given situation.

(f) Individuals who have mastered the overall research process could follow
and implement each research stage properly and ensure that each stage of
research is done correctly.

(g) Individuals who are aware of the limitations in research could avoid
wrong practices which might result in the collection of wrong data or in
the making of the wrong conclusions.

(h) Individuals who have mastered the research technique in sampling,

questionnaire design, experiments, observations and interviews could
conduct the research independently.

self-check 1.1

How could research skills enhance the information findings in a

research process?

1.3 PURPOSE OF DOING RESEARCH

activity 1.2

Describe a situation where research will help you as a manager to

make a good decision.

Basically, research is done to collect information in a systematic manner to help

overcome problems. The purposes of doing research can be classified as follows:

(a) Reporting / Exploring

This is the most basic or initial purpose of research; it is done mainly to
collect initial or background information. In reporting/exploring the
information, statistical summaries do not give inference or conclusion.
Although some say that reporting is not a research, but if the systematic
process has been followed then reporting studies are called research.
6  TOPIC 1  RESEARCH IN BUSINESS

A research design does not necessarily need to be complex and have

inferences to be called research.

(b) Descriptive
The purpose of this research is to answer questions relating to who,
what, when, where, and sometimes, how. Research is conducted to
describe or define a subject, often by creating a profile of a group of
problems, people or events. The study may involve data collection and
creating a distribution of the number of times an event takes place or
the characteristics of an object, or the interaction between two variables.
This type of study may or may not have the potential to draw powerful
inferences. If sufficient data is kept in the databases, the organisation can
easily conduct descriptive studies using internal information. Descriptive
research is popular because it can be done across disciplines, and can be
utilised easily for planning, monitoring and evaluating purposes.

(c) Explanatory
The purpose of this research is to answer questions relating to why
and how; it goes beyond description and explains the reasons for the
phenomenon (a fact) that the descriptive study only observes.

(d) Predictive
The purpose of this research is to predict when and in what situation
something can happen. If the reasons for an occurrence can be
explained, then it is also possible and desirable to predict when and in
what situation the event will occur. Being able to predict the time and the
situation of an occurrence makes it possible to control the phenomenon
(a fact). The knowledge generated from the occurrence, called a
phenomenon, can be used for other different groups of phenomena only if
the researcher could take into consideration all other variables influencing
the applications.

1.4 USES OF RESEARCH

Research projects can be placed in a continuum according to the purpose and
context. At one extreme of the research continuum is research undertaken
purely to understand the process of business and management and their
outcomes. Research is conducted for illumination of issues in the academic
context. The main purpose of this type of research is to increase understanding
of existing theories and generate new theories, giving little attention to practical
applications. This type of research is often termed basic, fundamental or pure
research. Basic research advances fundamental knowledge about the social world.
It is the source of most new scientific ideas and ways of thinking about the world.
 TOPIC 1  RESEARCH IN BUSINESS  7

At the other end of the continuum, research that is of relevance or immediate

application addresses issues that managers see as important and is presented
in as simple a manner as possible to enable speedy and immediate action. This
type of research is called applied research. Applied researchers apply and tailor
their knowledge to address a specific practical issue. Research is conducted by
commercial organisations to study issues in the practical context. They want to
answer policy questions or solve pressing social or business problems.

Basic research is rather traditional, academic-based research. It is associated,

although not fully, with the generation of Mode 1 knowledge in research.

Mode 1 knowledge focuses on fundamental research work rather than applied

research. Fundamental research tends to generate research questions based on
the interest of academics, not practising managers. Outputs of research are used
mainly for academic development rather than for industrial solution.

Mode 2 knowledge emphasises input from the practising world. This research
needs collaboration and participation of practising managers. It aims to solve
industrial problems and thus, generates industry-relevant knowledge. Mode 2
knowledge develops from Mode 1. This is because research in business not only
needs to address and solve management problems, but also advance knowledge
and understanding about a discipline.

EXERCISE 1.1

What are the key differences between basic and applied research?

1.5 CRITERIA OF QUALITY RESEARCH

activity 1.3

Why is it necessary to follow the standards of the scientific method?

Good information can only be obtained from good research and dependable
information,is derived from research practices done professionally. Good research
is carefully planned and conducted, which produces data that a manager can use
8  TOPIC 1  RESEARCH IN BUSINESS

to overcome problems or to reduce the risks in decision-making. Good research

must follow the standards of the scientific method. The characteristics of the
scientific method are:

(a) Purpose Clearly Defined

The reason or purpose for doing the research must be clearly defined
to eliminate any ambiguity. The purpose may be to solve problems or
to make a decision. State the purpose in writing; hence the statement to
indicate the purpose should include its scope, limitations and precise
specification of the meaning of all words and terms the researcher wants
to use in the research. It is necessary to make sure the readers understand
the research report and do not have any doubt as to what the researcher is
doing.

(b) Research Process Detailed

The process of doing the research should be described in sufficient detail
so that any other researcher can repeat the research. The sources of data
and the method of collecting the data should be described in detail, unless
imposed by secrecy rules. If the process is not described in detail, then
questions relating to the validity and reliability of the process and the data
will arise.

(c) Research Design Thoroughly Planned

The process of doing the research must be carefully planned so that
the findings are as objective as possible. If primary data collection
is to be used, the sample must be described to show evidence of its
representativeness. If data collection methods lead to ambiguity, they
should be avoided and replaced with available documentary sources or a
direct observation method. Sources of information should be as thorough
and complete as possible. When using experiments for data collection, the
control observation must be satisfactorily placed. Efforts must be made to
reduce personal influence or biases in selecting and recording data.

(d) High Ethical Standards Used

Normally a research project is not bound by any legal requirement and
is independently done and the researcher has control over the execution
and design of the research project. A research project with high priority
in safeguarding the participants from any physical or mental harm, and
yet able to produce quality results, should be highly valued. The design
of the procedures and instruments should place high priority on privacy,
confidentiality, dignity and no deception to ensure that no physical or
psychological harm can happen to the participants be they individuals or
organisations.
 TOPIC 1  RESEARCH IN BUSINESS  9

(e) Limitations Frankly Revealed

As every research project will be affected by a number of constraints, the
researcher must report with frankness any flaws in the procedure, design
and data that might affect the findings. Some of the limitations may not
have much significant effects on the findings, while others may cause
the research to be invalid. If a researcher says that he does not face any
limitation in doing the project, his research must be questioned.

(f) Analysis Must be Adequate to Meet the Needs of the Decision-Maker

The researcher should use the most appropriate method to analyse the
data and the analysis should be able to reveal adequate information
to help the decision-making process. To ensure that the findings are
sufficient for the needs of the manager, the validity and reliability of
the data must be checked. The findings should be explained to assist in
making conclusions, and if any statistical test is used, it should reveal
the probability of making errors and the criteria used for statistical
significance. The presentation of the findings should be restrained, clear,
precise, comprehensive, easily understood and organised so that the
decision-maker can easily locate the critical findings. Any generalisation
that outruns the evidence based on exaggerations and unnecessary use of
bombastic words and terms tend to leave an unfavourable impression of
the researcher.

(g) Conclusions Justified

In making conclusions, the researcher should confine himself to those
justified by the data of the research and limited to those that have factual
basis. When sampling is used, caution must be taken not to simply make
generalisations from the limited population and apply it universally.
The researcher may be tempted to draw conclusions for the study being
undertaken using data collected in prior studies. The precautions taken
in drawing conclusions will prevent the study from being less objective
and increase confidence in the findings. All conditions under which the
conclusions are to be made should be specified to make them valid.

(h) Researcher’s Experience Reflected

Users and readers of the research report will have greater confidence
knowing that the researcher is experienced, has a good reputation in
doing research and possesses high integrity. The information relating to
the researcher and his qualifications will be one of the criteria for judging
the degree of confidence in the research results, and any decision based on
the research will get high value.
10  TOPIC 1  RESEARCH IN BUSINESS

activity 1.4

In your opinion, which among the eight characteristics above is the

most important? Give your reasons.

1.6 RELATIONSHIPS BETWEEN RESEARCHER

AND MANAGER

activity 1.5

How would you define a good relationship?

For managers to make decisions, they need information; thus gathering of

information becomes an integral part of a manager’s job. Managers at the lower
hierarchy, who do not have many resources at their disposal, will normally do
the research themselves. If the managers do not have the time or talent to do
the research, they may delegate the work to a staff assistant or to a research
specialist. This delegation of tasks may result in greater efficiency and synergy
if both parties have similar objectives and can make full contribution of the
cooperation. But the separation of research user and research conductor may
create some problems in data analysis, interpretation, conclusion, finding and
recommendations. It is for these conflicts that many businesses prefer to use
the same researcher repeatedly; the knowledge of the company, workers and its
processes is as critical as knowledge of the decision-making dilemma.

1.6.1 Manager – Researcher Contributions

To enable the researcher to complete the project satisfactorily, the managers
have to specify the problems and provide the researcher with the background
information and allow access to company information gatekeepers. The manager
should specify the problems in terms of the decision choices that they have to
make rather than in terms of information that they think they need. The manager
and the researcher can decide on the information that needs to be produced based
on the specification of the problems.

The researcher also has obligations once the decision to carry out the project is
made. The organisation expects the researcher to provide them with the required
 TOPIC 1  RESEARCH IN BUSINESS  11

information using the most creative research design. The researcher will have to
provide the data analysed according to the problem specified and should also
give the implications that flow from the results. However, conflicts may arise
between what the decision-maker wants and what the researcher thinks should
be provided; the decision-maker wants simple and explicit recommendations,
but the researcher at best can provide probabilities and hedged interpretations.
This conflict has no simple answer but can be resolved if each side knows the
demands and restrictions imposed on the other.

1.6.2 Causes of Conflict between Researcher and

Client
Conflicts between researcher and manager may arise due to the limited
exposure of management to scientific research. Managers seldom have formal
training in research methodologies, and if they do, the rate of advancement in
research technology has created a big knowledge gap between managers and
researchers. The situation has made managers dependent on researchers and this
has brought about the feeling of threats to their personal status. To managers,
the management domain is theirs and they are the masters, any requests by
researchers for information may be treated as threats and potential rivalry.
Researches have to do their work within the environment of the political and
corporate culture developed within the organisation. When coalition among the
members is formed and they engage in self-serving activities, information may
be protected or blocked and findings may be distorted for the individual’s self-
interests. Researchers may find themselves isolated from managers because
researchers fall back on their specialty and form their own niche. Managers’
limited understanding of research techniques and requirements makes matters
worse.

EXERCISE 1.2

Outline the features that make business and management research

different from research in other disciplines.
12  TOPIC 1  RESEARCH IN BUSINESS

1.7 FACTORS INFLUENCING RESEARCH

UNDERTAKING
When a manager faces a problem, he has two alternative decisions to make,
whether to conduct research or not. The decision may be based on several factors
(Table 1.1).

Table 1.1: Factors Influencing Research Undertaking

No. Factor Description

1. Time Constraints All research conducted systematically requires time. In

some instances when management has to make a decision
immediately, there will be no time to conduct research.
In such cases, decisions are made without adequate
information or thorough understanding of the situation. It
is not ideal, but in certain circumstances the urgency of the
decision precludes the use of research.

2. Availability of In most cases a manager would have sufficient information

Data readily available to make sound decisions without the
need for business research. When the manager does not
have sufficient information, then research business must
be considered. The manager must determine if by doing
the research, information will be available to answer basic
questions about the decision. To do research, data must be
available; if data cannot be made available, then research
cannot be done.

3. Nature of the The nature of the decision to be made will determine

Decision the value of the information produced in the research. A
routine daily tactical activity will not require spending
on research, however, for a more strategically important
decision, information produced from systematically
conducted research may be warranted.

4. Benefit versus As all research requires expenditure, the benefits and costs
Costs of carrying out research projects should be compared. In
any decision-making process, the manager must identify
alternative courses of action, and then weigh the value of
each against its cost. Business research should be thought
of as an investment alternative.
 TOPIC 1  RESEARCH IN BUSINESS  13

activity 1.6

1. In what situation does a manager have to make crucial decisions?

2. Visit the following websites to obtain more information on the

methodologies discussed in this section:
(a) Help with research skills and researching the Internet:
http://www.support4learning.com/education/research.htm
(b) Some basic guides for doing business research:
http://www.bothell.washington.edu/library/guides/BusWeb/
BusWebContents.htm
(c) Research skills for home workers and small entrepreneurs:
http://www.infoplease.com/homework/researchskills1.html
(d) Web directory of business research resources:
http://www.business.com/directory/management/strategic_
planning/business research/
14  TOPIC 1  RESEARCH IN BUSINESS

EXERCISE 1.3

Tick the answer True (T) or False (F) for each statement below.

No. Question True False

1. Description studies are conducted to evaluate

specific courses of action or forecast current or
future values.

2. Managers ought to be well-grounded in basic

research because they have to make competent
decisions on whether to make or “buy” research
from researchers outside the firm.

3. Business research involves the use of complex

models rather than simpler quantitative methods.

4. An estimate of next year’s market share is an

example of predictive research.

5. Good research studies are always done by

experienced researchers.

6. Applied research is problem directed and closely

related to policy or action needs.

7. Research skills are irrelevant if prior research

data exists.

8. A study on the impact of sleep duration on work

efficiency is an example of basic research.

9. If Ali carries out a statistical analysis of errors in

the recording of inventories, he is doing research.

10. The value of applied research in the managerial

environment comes from its help in decision-
making.
 TOPIC 1  RESEARCH IN BUSINESS  15

SUMMARY

• Business research is a management tool which firms use to reduce risks

during the decision-making process.

• The information that a manager needs for decision-making may range from
long range planning information to most practical/tactical information.

• Research is information gathering. Scientific research is a systematic and

objective process of gathering, recording, and analysing data for decision-
making.

• Business research must be systematic, not haphazard or unplanned. It must

be objective to avoid being biased by personal judgment.

• The objective of applied research is to facilitate managerial decision-making.

The use of pure/basic research is to increase knowledge and concepts.

• The manager can use research in all stages of the decision-making process:
to define problems, to identify opportunities, to diagnose causal factors and
to clarify alternatives.

• Research is also used to evaluate current programmes and courses of action,

to explain what went wrong with managerial decisions in the past and to
forecast future actions and conditions.

• The needs for business research have become pertinent in view of the
increasingly global interrelationships of the business environment;
improvement and advancement in technologies have made the
methodologies of business research more complex and more available.

• Business firms must have the means to evaluate and interpret research
findings in order to use these in any decision-making process.

Case study Predictive

Descriptive Reporting
Experiment Surveys
Explanatory