Defining the Research Problem

and Developing an Approach

© 2007 Prentice Hall 2-1

 Chain Restaurant Study
One day I received a
phone call from a
research analyst who
introduced himself as
one of our alumni.
He was working for a
restaurant chain in town
and wanted help
analyzing the data he
had collected while
conducting a marketing
research study.

© 2007 Prentice Hall 2-2

 Chain Restaurant Study

When we met, he presented me with a copy of

the questionnaire and asked how he should
analyze the data. My first question to him was,

© 2007 Prentice Hall 2-3

 Chain Restaurant Study

When he looked
perplexed, I
explained that
data analysis is not
an independent
exercise.

Rather, the goal of data analysis is to PROVIDE

INFORMATION RELATED TO THE PROBLEM
COMPONENTS.
© 2007 Prentice Hall 2-4
 Chain Restaurant Study
I was surprised to learn that he
did not have a clear understanding
of the research problem and that
a written definition did not exist.
So before going any further, I had
to define the research problem.

Once that was done, I found that

much of the data collected was not
relevant to the problem. In this
sense, the whole study was a waste
of resources. A new study had to be
designed and implemented to
address the problem defined.
© 2007 Prentice Hall 2-5
 The Problem Definition Process
Tasks Involved
Fig. 2.1
Discussion Interviews Secondary Qualitative
with with Data Research
Decision Maker(s) Experts Analysis

Environmental Context of the Problem

Step I: Problem Definition

Management Decision Problem

Research Problem

Step II: Approach to the Problem

Analytical Specification
Objective/ Model: Verbal, Research of
Theoretical Hypotheses
Graphical, Questions Information
Foundations
Mathematical Needed

Step III: Research Design

© 2007 Prentice Hall 2-6
 Tasks Involved in Problem Definition

 Discussions with Decision Makers

 Interviews with Industry Experts
 Secondary Data Analysis
 Qualitative Research

© 2007 Prentice Hall 2-7

 The Problem Audit
The problem audit is a comprehensive examination of a

HR/Marketing/Finance problem with the purpose of

understanding its origin and nature.
1. The events that led to the decision that action is
needed, or the history of the problem.
2. The alternative courses of action available to the DM.
3. The criteria that will be used to evaluate the
alternative courses of action.
4. The potential actions that are likely to be suggested
based on the research findings.
5. The information that is needed to answer the DM's
questions.
6. The manner in which the DM will use each item of
information in making the decision.
7. The corporate culture as it relates to decision making.
© 2007 Prentice Hall 2-8
 The Seven Cs of Interaction
The interaction between the DM and
the researcher should be Characterized
by the seven Cs:
1. Communication
2. Cooperation
3. Confidence
4. Candor
5. Closeness
6. Continuity
7. Creativity
© 2007 Prentice Hall 2-9
 Factors to be Considered in the
Environmental Context of the Problem
Fig. 2.2

PAST INFORMATION AND FORECASTS

RESOURCES AND CONSTRAINTS

OBJECTIVES

EMPLOYEE/CUSTOMER/CLIENT BEHAVIOR

LEGAL ENVIROMENT

ECONOMIC ENVIROMENT

RESEARCH AND TECHNOLOGICAL

© 2007 Prentice Hall
SKILLS 2-10
 Management Decision Problem Vs.
Research Problem

Management Decision Problem Marketing Research Problem

Should a new product be To determine consumer preferences

introduced? and purchase intentions for the
proposed new product.

Should the advertising To determine the effectiveness

campaign be changed? of the current advertising
campaign.

Should the price of the To determine the price elasticity

brand be increased? of demand and the impact on sales
and profits of various levels
of price changes.

© 2007 Prentice Hall 2-11

 Proper Definition of the Research Problem
Fig. 2.3

Research Problem

Broad Statement

Specific Components

© 2007 Prentice Hall 2-12

 Department Store Project
Problem Definition
I
In the department store project, the marketing research problem is to
determine the relative strengths and weaknesses of Sears, vis-à-vis other
major competitors, with respect to factors that influence store patronage.
Specifically, research should provide information on the following questions.
1. What criteria do households use when selecting department
stores?
2. How do households evaluate Sears and competing stores in
terms of the choice criteria identified in question 1?
3. Which stores are patronized when shopping for specific
product categories?
4. What is the market share of Sears and its competitors for
specific product categories?
5. What is the demographic and psychological profile of the
customers of Sears? Does it differ from the profile of customers
of competing stores?
6. Can store patronage and preference be explained in terms of
store evaluations and customer characteristics?
© 2007 Prentice Hall 2-13
 Components of an Approach

 Objective/Theoretical Foundations
 Analytical Model
 Research Questions
 Hypotheses
 Specification of the Information Needed

© 2007 Prentice Hall 2-14

 The Role of Theory in
HR/Marketing/Finance Research
Research Task Role of Theory
1. Conceptualizing Provides a conceptual foundation and understanding of the basic processes
and identifying underlying the problem situation. These processes will suggest key dependent
key variables and independent variables.
2. Operationalizing Theoretical constructs (variables) can suggest independent and dependent
key variables variables naturally occurring in the real world.
3. Selecting a Causal or associative relationships suggested by the theory may indicate whether
research design a causal or descriptive design should be adopted.
4. Selecting a The theoretical framework may be useful in defining the population and
sample suggesting variables for qualifying respondents, imposing quotas, or stratifying
the population (see Chap. 11).
5. Analyzing and The theoretical framework (and the models, research questions and hypotheses
interpreting data based on it) guide the selection of a data analysis strategy and the interpretation
of results (see Chap. 14).
6. Integrating The findings obtained in the research project can be interpreted in the light of
findings previous research and integrated with the existing body of knowledge.

© 2007 Prentice Hall 2-15

 Models

An analytical model is a set of variables and their

interrelationships designed to represent, in whole or
in part, some real system or process.

In verbal models, the variables and their

relationships are stated in prose form. Such models
may be mere restatements of the main tenets of a
theory.

© 2007 Prentice Hall 2-16

 Graphical Models
Graphical models are visual. They are used to
isolate variables and to suggest directions of
relationships but are not designed to provide
numerical results.

Awareness

Understanding: Evaluation

Preference

Patronage
© 2007 Prentice Hall 2-17
 Mathematical Models
Mathematical models explicitly specify the
relationships among variables, usually in
equation form.
n
y = a 0
+ åa x i i
i =1

Where
y = degree of preference
a0 ,ai
= model parameters to be estimated
statistically
© 2007 Prentice Hall 2-18
 Development of Research
Questions and Hypotheses
Fig. 2.4

Components of the
Research Problem
Objective/
Theoretical
Framework
Research Questions
Analytical
Model
Hypotheses

© 2007 Prentice Hall 2-19

 Research Questions and Hypotheses

 Research questions (RQs) are refined

statements of the specific components of the
problem.
 A hypothesis (H) is an unproven statement or
proposition about a factor or phenomenon that is
of interest to the researcher. Often, a hypothesis
is a possible answer to the research question.

© 2007 Prentice Hall 2-20

 Department Store Project

 RQ: Do the customers of Sears exhibit store

loyalty?
 H1: Customers who are store-loyal are less
knowledgeable about the shopping environment.

 H2: Store-loyal customers are more risk-averse

than are non-loyal customers.

© 2007 Prentice Hall 2-21

 At United, Food Is Uniting the
Airline with Travelers

United Airlines, as other major airlines, had to deal with

passenger loyalty (management decision problem: how
to attract more and more loyal passengers). The broad
marketing research problem was to identify the factors
that influence loyalty of airline travelers.

© 2007 Prentice Hall 2-22

 At United, Food Is Uniting the Airline with Travelers

The basic answer is to improve service. Exploratory

research, theoretical framework, and empirical evidence
revealed that the consumers’ choice of an airline is
influenced by: safety, price of the ticket, frequent-flyer
program, convenience of scheduling, and brand name.

© 2007 Prentice Hall 2-23

At United, Food Is Uniting the Airline
with Travelers

A graphical model stipulated that

consumers evaluate competing airlines
based on factors of the choice criteria to
select a preferred airline. The problem
was that major airlines were quite
similar on these factors. Indeed,
"airlines offer the same schedules, the
same service, and the same fares.”
Consequently, United Airlines had to find
a way to differentiate itself. Food turned
out to be the solution.
At United, Food Is Uniting the
Airline with Travelers

Secondary data, like the J. D Power & Associates'

survey on "current and future trends in the airline
food industry," indicated that "food service is a major
contributor to customers’ loyalty." This survey also
emphasized the importance of food brands.
At United, Food Is Uniting the Airline
with Travelers
The airline's Marketrak survey told United Airlines that
"customers wanted more varied and up-to-date food.”
The following research questions and hypotheses may be
posed.
RQ1 How important is food for airline customers?
H1: Food is an important factor for airline travelers.
H2: Travelers value branded food.
H3: Travelers prefer larger food portions, but with
consistent quality.
H4: Travelers prefer exotic food.
At United, Food Is Uniting the Airline
with Travelers
Characteristics that influence the research design
included the identification of competing airlines (Delta,
American, etc.), factors of the choice criteria (already
identified), measurement of airline travel, and loyalty.
At United, Food Is Uniting the Airline
with Travelers
This kind of research helped United Airlines define their marketing
research problem and develop the approach. Focus groups and
surveys were conducted to check customers' perceptions of food in
United Airlines' aircraft. The results provided support for all the
hypotheses (H1 to H4). United Airlines then made a few changes:
new "culinary menus," larger portions of food, new coffee, and
branded products (e.g., Godiva chocolates). This resulted in better
service, increasing customer satisfaction and fostering loyalty.