ROLE OF BUSINESS RESEARCH
Learning Outcomes
1. Know how to define business research
2. Understand how research contributes to business
success and how research activities can be used to
address business decisions
3. Understand the difference between basic and
applied business research
4. Know when business research should and should
not be conducted
5. Appreciate the way technology and
internationalization are changing business research
Business Research Defined
• Business research is the application of the scientific method for
acquiring information and knowledge for professional or
commercial purposes such as determining opportunities and goals
for a business
• Business Research Methods - A Decision Making Tool in the Hands
of Management
• Literally, research (re-search) -“search again”
• Research information is neither intuitive nor haphazardly gathered.
• Business research must be objective
RESEARCH
•Research is all about finding something, the absence of which may
distort our ability to take informed decisions (Nwokah et al., 2009).
•The ability to take an informed decision is generated through a
systematic study that is conducted through various interrelated
stages.
•All the steps in a research are interrelated and no independent
activity is launched without considering the decisions on the
previous stages.
•One has to really understand that, from problem identification to
presentation of findings, every step is interlinked and interrelated.
The decision-making process associated with the
development and implementation of a business strategy
involves five interrelated stages:
1. Identifying and defining problems and opportunities
2. Diagnosing and assessing problems or opportunities
3. Executing business research to explore the solutions
4. Selecting and implementing a course of action
5. Evaluating the course of action
1. Identifying problems and opportunities
Any delay in problem identification and solution
implementation; and the opportunity identification and
encashment may become harmful to the organization.
2. Diagnosing and assessing problems or opportunities
Organizations present these problems or opportunity
scenarios to business researchers.
Business researchers diagnose the problem or opportunity.
Diagnosing involves exploring the situation to have a better
insight about the situation.
3. Executing business research to explore the solutions
After the identification and diagnosis of the problem, business
researchers systematically conduct research to present a solution.
4. Selecting and implementing a course of action
Business researchers conduct research in consultation with the
decision makers of the concerned organization. The findings are
presented to the decision maker and he or she analyzes these
findings in the light of his or her decision range.
5. Evaluating the course of action
After taking a decision, its effectiveness is examined. This is
sometimes referred to as evaluation research.
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?
Determining When to Conduct Business Research
Business Research Types
• Basic Research (Pure Research)
• Applied Research
Basic Business Research
• Basic Business Research –(Fundamental/Pure research) is
driven by a researcher/scientist’s interest in a topic/area
• Research conducted without a specific decision in mind that
usually does not address the needs of a specific organization
• The main motivation is to expand man's knowledge, not
only to create or invent something. Attempts to expand the
limits of knowledge
• Many times, there is no commercial value to the discoveries
that result from basic research
Basic Research Example
• Is executive success correlated with high need
for achievement?
• Do consumers experience cognitive
dissonance in low-involvement situations?
• How to improve the effectiveness of small
businesses
Applied Business Research
• Applied business research is conducted to
address a specific business decision for a
specific firm or organization.
• Conducted when a decision must be made
about a specific real-life problem
Applied Research Examples
• Should McDonalds add Italian pasta dinners to
its menu?
• Business research told McDonald’s it should
not.
• Should Procter & Gamble add a high-priced
home teeth bleaching kit to its product line?
• Research showed Crest White strips would sell
well at a retail price of $44.
• Which health insurance plan should a business
provide for its employees?
• India, a multicultural country, McDonalds faced quite a big
challenge due to cultural restrictions
• Beef (cow is considered sacred and is worshipped)
• Pork (Muslims do not eat pork)
• Majority of Indians were vegetarians
• Challenge for McDonalds to introduce Cheeseburgers- (Beef) to
the public, most reputed and top selling product in western
countries
• Vegetarian consumers - “McAloo tikki”(deep fried spicy potato
patty), veg pops an alternative for chicken nuggets and for their
Non-vegetarian chicken lovers BigMac was replaced by “Chicken
Maharaja Burger” along with an increase in their chicken and fish
options
• McDonalds in their research considered local demographics,
income level and customer preferences which was key reason for
it to achieve success in a multi-cultural country.
BASIS FOR
BASIC RESEARCH APPLIED RESEARCH
COMPARISON
Meaning Basic Research refers to the Applied Research is the
study that is aimed at research that is designed
expanding the existing base to solve specific practical
of scientific knowledge. problems or answer
certain questions.
Nature Theoretical Practical
Utility Universal Limited
Concerned with Developing scientific Development of
knowledge and predictions technology and technique
Goal To add some knowledge to To find out solution for
the existing one. the problem at hand.
