1. Research and Scientific Method

2. Scientific Method
“Scientific Method and scientific enquiry generally is described as puzzle solving activity”

3. The Scientific Method Direct observation Clearly defined variables
Clearly defined methods
Empirically testable
Elimination of alternatives
Statistical justification
Self-correcting process
Good business research is based on sound reasoning because reasoning is essential for producing scientific results. This slide introduces the scientific method and its essential tenets. The scientific method guides our approach to problem-solving.
An important term in the list is empirical. Empirical testing denotes observations and propositions based on sensory experiences and/or derived from such experience by methods of inductive logic, including mathematics and statistics. Researchers using this approach attempt to describe, explain, and make predictions by relying on information gained through observation.
The scientific method is described as a puzzle-solving activity.

4. Researchers Encounter problems State problems Propose hypotheses
Deduce outcomes
Formulate rival hypotheses
Devise and conduct empirical tests
Draw conclusions
The steps followed by business researchers to approach a problem are presented in the slide.

5. Sound Reasoning Types of Discourse Exposition Argument Deduction
Exposition consists of statements that describe without attempting to explain.
Argument allows us to explain, interpret, defend, challenge, and explore meaning. There are two types of argument: deduction and induction.
Deduction is a form of reasoning in which the conclusion must necessarily follow from the premises given. The next slide provides an example of a deductive argument.
Induction is a form of reasoning that draws a conclusion from one or more particular facts or pieces of evidence. Slide 2-8 illustrates an inductive argument.
Deduction
Induction

6. Sound reasoning for useful answers
We reason with varying degree of success and communicate our meaning in language, symbolic or logic form.
Our meanings are conveyed through one of two types of discourse :
Exposition : statements that describe without attempting to explain
Argument : allows us to explain, interpret, defend, challenge and explore meaning.

7. Types of arguments Deduction – conclusiveness on basis of premises
All employees at Bank One can be trusted to observe the ethical code.
Sara is an employee of BankOne
Sara can be trusted to observe the ethical code.
Induction - Conclusion from one or more particular fact.
$1mn spent on regional promotion. Still low sale.
Inductive conclusion is an inferential jump beyond the evidence presented

8. Deductive Reasoning
Inner-city household interviewing is especially difficult and expensive
This survey involves substantial inner-city household interviewing
This slide provides an example of a deductive argument.
The interviewing in this survey will be especially difficult and expensive
© 2002 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin

9. Inductive Reasoning
Why didn’t sales increase during our promotional event?
Regional retailers did not have sufficient stock to fill customer requests during the promotional period
A strike by employees prevented stock from arriving in time for promotion to be effective
A hurricane closed retail outlets in the region for 10 days during the promotion
This slide provides an example of an inductive argument.

10. Exhibit 2-1 Why Didn’t Sales Increase?
Deduction
Induction and deduction can be used together in research reasoning. Induction occurs when we observe a fact and ask, “Why is this?” In answer to this question, we advance a tentative explanation or hypothesis. The hypothesis is plausible if it explains the event or condition (fact) that prompted the question. Deduction is the process by which we test whether the hypothesis is capable of explaining the fact. Exhibit 2-1 illustrates this process.

11. Exhibit 2-2 Tracy’s Performance

12. Language of Research
“What will be the department’s reaction to the new flexible work schedule?”
Which members of the department: clerical or professional?
What kind of reaction ? What are normal indicators?
These questions require the use of concepts, constructs and definitions.

13. Language of Research Terms used in research Concepts Constructs
Conceptual
schemes
Models
Operational
definitions
Terms used
in research
Several terms are used by researchers to converse about applied and theoretical business problems.
A concept is a bundle of meanings or characteristics associated with certain concrete, unambiguous events, objects, conditions, or situations. The importance of conceptualization is discussed in the following slide.
A construct is a definition specifically invented to represent an abstract phenomena for a given research project. Exhibit 2-3, a depiction of job redesign constructs, is provided in Slide 2-13.
A conceptual scheme is the interrelationship between concepts and constructs.
An operational definition defines a variable in terms of specific measurement and testing criteria. An example of an operational definition is provided in Slide 2-14.
A variable is used as a synonym for the construct being studied. Slides 2-15 through 2-20 expand on different types of variables.
A proposition is a statement about observable phenomena that may be judged as true or false. (Slide 2-21)
A hypothesis is a proposition formulated for empirical testing. (Slides 2-22 through 2-25)
A theory is a set of systematically interrelated concepts, definitions, and propositions that are advanced to explain or predict phenomena. Slide 2-26 shows an example of a theory.
A model is a representation of a system constructed to study some aspect of that system. Slide 2-27 shows an example of a model.
Theory
Variables
Propositions/
Hypotheses

14. Clear conceptualization
Language of Research
Clear conceptualization
of concepts
Success of
Research
Shared understanding
of concepts
We must attempt to measure concepts in a clear manner that others can understand. If concepts are not clearly conceptualized and measured, we will receive confusing answers.

15. Concepts
Survey people on the question of customer loyalty, the questions we use need to tap faithfully the attitudes of the participants.
How clearly we conceptualize?
How well others understand the concepts we use?

16. Constructs
A construct is an image or abstract idea specifically invented for a given research and /or theory building purpose.
We build constructs by combining the simpler , more concrete concepts.

17. Exhibit 2-3 Job Redesign Constructs and Concepts
Exhibit 2-3 illustrates some of the concepts and constructs relevant to job redesign. The concepts at the bottom of the exhibit (format accuracy, manuscript errors, and keyboarding speed) are the most concrete and easily measured. Keyboarding speed is one just concept in the group that defines a construct that the human resource analyst calls Presentation Quality. It is not directly observable like keyboarding speed. It is a term used to communicate (a label) the combination of meanings presented by the three concepts.
Concepts at the next level are vocabulary, syntax, and spelling. As they are related, the analyst groups them into a construct she calls language skill. Language skills is placed at a higher level of abstraction in the exhibit because two of the concepts that comprise it, vocabulary and syntax, are more difficult to observe and measure.
The construct of job interest is not yet measured nor are its components specified. Researchers often refer to such constructs as hypothetical constructs because they are inferred only from the data—they are presumed to exist but no measure tests whether such constructs actually exist.
If research shows the concepts and constructs in this example to be interrelated, and if the connections can be supported, then the analyst has the beginning of a conceptual scheme.
One exercise you can try is to have students attempt to identify the concepts/constructs in the hypothetical construct…job interest, and discuss which elements are truly measurable…and how.
3-17

18. Definitions
Confusion about the meaning of concepts can destroy a research study’s value without the researcher or client even knowing it.
Operational definition is a definition stated in terms of specific criteria for testing or measurement.

19. What Is A Variable? Variable Event Act Characteristic Trait
In practice, the term variable is used as a synonym for the property being studied. In this context, a variable is a symbol of an event, act, characteristic, trait, or attribute that can be measured and to which we assign categorical values. The different types of variables are presented on the following slides.

20. Religious affiliation
Types of Variables
Dichotomous
Male/Female
Employed/ Unemployed
Discrete
Ethnic background
Educational level
Religious affiliation
For the purposes of data entry and analysis, we assign numerical values to a variable based on that variable’s properties. Dichotomous variables have only two values that reflect the absence or presence of a property. Variables also take on values representing added categories such as demographic variables. All such variables are said to be discrete since only certain values are possible. Continuous variables take on values within a given range or, in some cases, an infinite set.
Continuous
Income
Temperature
Age

21. Variables
Variable is a symbol of an event, act, characteristic, trait, or attribute that can be measured and to which we assign categorical value.
Dichotomous
Discrete
Continuous
Independent and dependent Variables

22. Exhibit 2-4 Independent and Dependent Variables
Independent Variable (IV)
Predictor
Presumed cause
Stimulus
Predicted from…
Antecedent
Manipulated
Dependent Variable (DV)
Criterion
Presumed effect
Response
Predicted to….
Consequence
Measured outcome
Exhibit 2-4 presents the commonly used synonyms for independent and dependent variables.
An independent variable is the variable manipulated by the researcher to cause an effect on the dependent variable.
The dependent variable is the variable expected to be affected by the manipulation of an independent variable.

23. Moderating Variables (MV)
The switch to commission from a salary compensation system (IV) will lead to increased sales productivity (DV) per worker, especially among younger workers (MV).
The loss of mining jobs (IV) leads to acceptance of higher-risk behaviors to earn a family-supporting income (DV) – particularly among those with a limited education (MV).
Moderating variables are variables that are believed to have a significant contributory or contingent effect on the originally stated IV-DV relationship. Whether a variable is treated as an independent or as a moderating variable depends on the hypothesis. Examples of moderating variables are shown in the slide.

24. Extraneous Variables (EV)
With new customers (EV-control), a switch to commission from a salary compensation system (IV) will lead to increased sales productivity (DV) per worker, especially among younger workers (MV).
Among residents with less than a high school education (EV-control), the loss of jobs (IV) leads to high-risk behaviors (DV), especially due to the proximity of the firing range (MV).
Extraneous variables are variables that could conceivably affect a given relationship. Some can be treated as independent or moderating variables or assumed or excluded from the study. If an extraneous variable might confound the study, the extraneous variable may be introduced as a control variable to help interpret the relationship between variables. Examples are given in the slide.

25. Propositions and Hypotheses
Proposition as a statement about phenomena (concepts) that may be judged as true or false.
When a proposition is formulated for empirical testing, we call it a hypothesis.

26. Propositions and Hypotheses
Brand Manager Jones (case) has a higher- than-average achievement motivation (variable).
Brand managers in Company Z (cases) have a higher-than-average achievement motivation (variable).
Generalization
A proposition is a statement about observable phenomena that may be judged as true or false. A hypothesis is a proposition formulated for empirical testing. A case is the entity or thing the hypothesis talks about. When the hypothesis is based on more than one case, it would be a generalization. Examples are provided in the slide.

27. Descriptive Hypotheses :They state the existence, size , form or distribution of some variable.
Relational Hypotheses :
Co relational hypotheses
Explanatory (causal) hypotheses

28. Hypothesis Formats Descriptive
In Detroit, our potato chip market share stands at 13.7%.
American cities are experiencing budget difficulties.
Research Question
What is the market share for our potato chips in Detroit?
Are American cities experiencing budget difficulties?
A descriptive hypothesis is a statement about the existence, size, form, or distribution of a variable. Researchers often use a research question rather than a descriptive hypothesis. Examples are provided in the slide. Either format is acceptable, but the descriptive hypothesis has three advantages over the research question.
Descriptive hypotheses encourage researchers to crystallize their thinking about the likely relationships.
Descriptive hypotheses encourage researchers to think about the implications of a supported or rejected finding.
Descriptive hypotheses are useful for testing statistical significance.

29. Relational Hypotheses
Correlational
Young women (under 35) purchase fewer units of our product than women who are older than 35.
The number of suits sold varies directly with the level of the business cycle.
Causal
An increase in family income leads to an increase in the percentage of income saved.
Loyalty to a grocery store increases the probability of purchasing that store’s private brand products.
A relational hypothesis is a statement about the relationship between two variables with respect to some case. Relational hypotheses may be correlational or explanatory (causal).
A correlational hypothesis is a statement indicating that variables occur together in some specified manner without implying that one causes the other.
A causal hypothesis is a statement that describes a relationship between two variables in which one variable leads to a specified effect on the other variable.

30. The Role of Hypotheses Guide the direction of the study
Identify relevant facts
Suggest most appropriate research design
Provide framework for organizing resulting conclusions
This slide presents the functions served by hypotheses.

31. Husbands and wives agree in heir perceptions of their respective roles in purchase decisions.
Who shall be studied (Married Couples)
In what context they shall be studied (their consumer decision making)
What shall be studied (their individual perceptions of their roles)

32. Characteristics of Strong Hypotheses
Adequate A
Strong
Hypothesis Is
Testable
The conditions for developing a strong hypothesis are more fully developed in Exhibit 2-5.
Better
than rivals

33. Theory Degree of complexity
It is midday and you note that the outside natural light is dimming, dark clouds are moving rapidly in from the west, the freeze is freshening and the air temperature is cooling.
Weather theory
A theory is a set of systematically interrelated concepts , definitions & proposition that are advanced to explain & predict phenomena (facts)

34. Models
A model is defined here as a representation of a system that is constructed to study some aspect of that system or the system as whole.

35. Models versus Theories
a model’s role is to represent or describe
A theory’s role is to explain.
Models in business research may be descriptive, predictive, and normative.
Descriptive models are used for complex systems because they allow for the visualization of numerous variables and relationships.
Predictive models forecast future events and facilitate business planning.
Normative models are used for control, because they indicate necessary actions.
Models allow researchers to specify hypotheses that characterize present or future conditions: the effect of advertising on consumer awareness or intention to purchase, brand switching behavior, an employee training program, or other aspects of business.

36. Exhibit 2-7 A Distribution Network Model
A model is a representation of a system constructed to study some aspect of that system or the system as a whole.
Models versus Theories
a model’s role is to represent or describe
A theory’s role is to explain.
Models in business research may be descriptive, predictive, and normative.
Descriptive models are used for complex systems because they allow for the visualization of numerous variables and relationships.
Predictive models forecast future events and facilitate business planning.
Normative models are used for control, because they indicate necessary actions.
Exhibit 2-7, shown in the slide, is a distribution network model called a maximum flow model used in management science. In this example, a European manufacturer of automobiles needs an increased flow of shipping to its Los Angeles distribution center to meet demand. However the primary distribution channel is saturated and alternatives must be sought.
Models allow researchers to specify hypotheses that characterize present or future conditions: the effect of advertising on consumer awareness or intention to purchase, brand switching behavior, an employee training program, or other aspects of business.

37. Exhibit 2-8 The Role of Reasoning
Business models are developed through the use of inductive and deductive reasoning.
As illustrated in Exhibit 2-8, a business model may originate from empirical observations about market behavior based on researched facts and relationships among variables.
Inductive reasoning allows the modeler to draw conclusions from the facts or evidence in planning the dynamics of the model. The modeler may also use existing theory, managerial experience or judgment, or facts.