Week 1: The Role of

Business Research
Business Research Methods 
LEARNING
LEARNING
OUTCOMES
OUTCOMES

1. Understand how research contributes to business

success
2. Know how to define business research
3. Understand the difference between basic and applied
business research
4. Understand how research activities can be used to
address business decisions
5. Know when business research should and should not
be conducted
6. Appreciate the way technology and
internationalization are changing business research

1-2
ESPN Hits a Home Run
• ESPN has information in
many databases.
• Business research
integrated it so they
could learn more about
how fans use their
media.
• Gaining intelligence had
bottom-line
implications for their
own revenue and their
advertisers'
1-3
Business Research Defined
• Business research is the application of the scientific
method in searching for the truth about business
phenomena.
• The process includes:
• idea and theory development
• problem definition
• searching for and collecting information
• analyzing data
• communicating the findings and their implications

1–4
Business Research Defined
• This definition suggests that business research
information is:
• not intuitive or haphazardly gathered
• accurate and objective
• relevant to all aspects of the business
• limited by one’s definition of business
• Not-for-profit organizations and governmental
agencies can use research in much the same ways
as managers in for-profit organizations.

1–5
Applied and Basic Business
Research
• Applied business research
• conducted to address a specific business decision for a
specific firm or organization.
• Example:
• Should McDonald’s add Italian pasta dinners to its menu?
• Which health insurance plan should a business provide for its
employees?

1–6
Applied and Basic Business
Research
• Basic business research (also called pure research)
• conducted without a specific decision in mind that
usually does not address the needs of a specific
organization.
• Attempts to expand the limits of knowledge in general.
• Not aimed at solving a pragmatic problem.
• Example:
• Do consumers experience cognitive dissonance in low-
involvement situations?
• Does employee tenure with a company influence productivity?

1–7
The Scientific Method
• Scientific Method
• The way researchers go about using knowledge and
evidence to reach objective conclusions about the real
world.
• The analysis and interpretation of empirical evidence
(facts from observation or experimentation) to confirm
or disprove prior conceptions

1–8
 A Summary of the Scientific
EXHIBIT 1.1
Method

1–9
Managerial Value of
Business Research
There are only a few business orientations:
• Product-oriented
• Production-oriented
• Marketing-oriented

1–10
Managerial Value of
Business Research
The decision-making process associated with the
development and implementation of a business
strategy involves four interrelated stages:
1. Identifying problems and opportunities
2. Diagnosing and assessing problems or
opportunities
3. Selecting and implementing a course of action
4. Evaluating the course of action

1–11
Evaluating the Course of
Actions
• Evaluation Research
• The formal, objective measurement and appraisal of the
extent a given activity, project, or program has achieved
its objectives.
• Performance Monitoring Research
• Research that regularly, sometimes routinely, provides
feedback for evaluation and control of business activity.

Examples?

1–12
When is Business Research
Needed?
• The determination of the need for research centers
on:
1. Time constraints
2. The availability of data
3. The nature of the decision to be made
4. Benefits versus costs (the value of the research
information in relation to costs)
• Will the payoff or rate of return be worth the investment?
• Will the information improve the quality of the managerial
decision enough to warrant the expenditure?
• Is the expenditure the best use of the available funds?

1–13
Harley-Davidson Goes
Abroad
• Consumers in different
countries have different
preferences.
• Even if consumers want
it, government
regulations can make it
prohibitive (e.g., India).
• Harley is pursuing the
U.S. women’s market for
bikes.

1-14
Business Class Success?
• Business-class travelers
want comfort, good food,
and convenient boarding,
but the price is hefty.
• Two start-ups offered
“discount” business-class-
only airlines but failed.
• Could more effective
research have
determined that these
were not feasible
business ventures?

1-15
Business Research in the
21st Century
• Communication Technologies
• Always “connected”—time, place, and distance are
irrelevant.
• Decreases in information acquisition, storage, access,
and transmission costs.

1–16
Business Research in the
21st Century
• Global Business Research
• Business research is increasingly global.
• Must understand the nature of particular markets.
• Cross-validation
• Verify that the empirical findings from one culture also exist
and behave similarly in another culture.

1–17
“Jacques” Daniels
• Research findings:
• Japanese use JD as a
dinner beverage
• Australian’s drink
distilled spirits at home
• British like to drink at
bars and restaurants
• Chinese prefer “knock-
offs” to save money and
enjoy it with green tea

1-18
THANK YOU.