1. Chapter 5 The Human Side of Business Research: Organizational and Ethical Issues © 2010 South-Western/Cengage Learning. All rights reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. EIGHTH EDITION BUSINESS MARKET RESEARCH ZIKMUND BABIN CARR GRIFFIN

2. © 2010 South-Western/Cengage Learning. All rights reserved. May not be scanned, copied or duplicated, or posted to a publically accessible website, in whole or in part.5–2 LEARNING OUTCOMES 1.Know when research should be conducted externally and when it should be done internally 2.Be familiar with the types of jobs, job responsibilities and career paths available within the business research industry 3.Understand the often conflicting relationship between management and researchers 4.Define ethics and understand how it applies to business research After studying this chapter, you should

3. © 2010 South-Western/Cengage Learning. All rights reserved. May not be scanned, copied or duplicated, or posted to a publically accessible website, in whole or in part.5–3 LEARNING OUTCOMES (cont’d) 5.Know and appreciate the rights and obligations of a) research respondents—particularly children, b) business researchers, and c) research clients or sponsors 6.Know how to avoid situations involving a conflict of interest in performing business research After studying this chapter, you should

4. © 2010 South-Western/Cengage Learning. All rights reserved. May not be scanned, copied or duplicated, or posted to a publically accessible website, in whole or in part.5–4 Who Does the Research? Outside AgencyOutside Agency  An independent research firm contracted by the company that actually will benefit from the research. In-house ResearchIn-house Research  Research performed by employees of the company that will benefit from the research.

5. © 2010 South-Western/Cengage Learning. All rights reserved. May not be scanned, copied or duplicated, or posted to a publically accessible website, in whole or in part.5–5 EXHIBIT 5.1 Should Research Be Done In-House or By an Outside Agency?

6. © 2010 South-Western/Cengage Learning. All rights reserved. May not be scanned, copied or duplicated, or posted to a publically accessible website, in whole or in part.5–6 Organizational Structure of Business Research Small firmsSmall firms  < 100 employees  VP of marketing may be in charge of all significant marketing research. Mid-sized firmsMid-sized firms  100-500 employees Large firmsLarge firms  > 500 employees

7. © 2010 South-Western/Cengage Learning. All rights reserved. May not be scanned, copied or duplicated, or posted to a publically accessible website, in whole or in part.5–7 EXHIBIT 5.2 The Largest Research Firms in the World

8. © 2010 South-Western/Cengage Learning. All rights reserved. May not be scanned, copied or duplicated, or posted to a publically accessible website, in whole or in part.5–8 Organizational Structure of Business Research: Mid-Sized Firms Director of marketing researchDirector of marketing research  Provides leadership in research efforts and integrates all staff-level research activities into one effort.  Plans, executes, and controls the firm’s research function. Research analystResearch analyst  Responsible for client contact, project design, preparation of proposals, selection of research suppliers, and supervision of data collection, analysis, and reporting activities.

9. © 2010 South-Western/Cengage Learning. All rights reserved. May not be scanned, copied or duplicated, or posted to a publically accessible website, in whole or in part.5–9 Organizational Structure of Business Research (cont’d) Research assistants (or associates)Research assistants (or associates)  Provide technical assistance with questionnaire design, data analyses, and similar activities. Manager of decision support systemsManager of decision support systems  Supervises the collection and analysis of sales, inventory, and other periodic customer relationship management (CRM) data. Forecast analystForecast analyst  Provides technical assistance, such as running computer programs and manipulating data to forecast sales.

10. © 2010 South-Western/Cengage Learning. All rights reserved. May not be scanned, copied or duplicated, or posted to a publically accessible website, in whole or in part.5–10 EXHIBIT 5.3 Organization of the Marketing Research Department in a Large Firm a Conducts research to improve total quality management in production. b Conducts research that cuts across product lines or involves competitive marketing practices or characteristics of customer groups. c Conducts research that cuts across product lines to measure the effectiveness of promotional activities. d Conducts research aimed at gaining a basic understanding of various elements of the marketing process.

11. © 2010 South-Western/Cengage Learning. All rights reserved. May not be scanned, copied or duplicated, or posted to a publically accessible website, in whole or in part.5–11 The Director of Research as a Manager Problems in directing research:Problems in directing research:  Skilled research professionals like conducting research better than managing people.  The research management role often is not formally recognized.  Outstanding research professionals often have trouble delegating responsibility.  Research is often seen as a hodgepodge of techniques available to answer individual, unrelated questions.

12. © 2010 South-Western/Cengage Learning. All rights reserved. May not be scanned, copied or duplicated, or posted to a publically accessible website, in whole or in part.5–12 Sources of Conflict between Management and Research Future decisions based on past experience Intuitive decision making TimeTime MoneyMoney Research that implies criticism Management versus Research

13. © 2010 South-Western/Cengage Learning. All rights reserved. May not be scanned, copied or duplicated, or posted to a publically accessible website, in whole or in part.5–13 EXHIBIT 5.4 Areas of Conflict Between Top Management and Researchers

14. © 2010 South-Western/Cengage Learning. All rights reserved. May not be scanned, copied or duplicated, or posted to a publically accessible website, in whole or in part.5–14 Reducing the Conflict between Management and Researchers Ways to reduce conflictWays to reduce conflict  Early in projects and working closely together  Formal job description  Better planning and an annual statement of the research program  Communication of research findings and designs Research generalistResearch generalist  Serves as a link between management and research specialists in acting as a problem definer, an educator, a liaison, a communicator, and a friendly ear.

15. © 2010 South-Western/Cengage Learning. All rights reserved. May not be scanned, copied or duplicated, or posted to a publically accessible website, in whole or in part.5–15 EXHIBIT 5.6 Improving Two- Way Communication to Reduce Conflict

16. © 2010 South-Western/Cengage Learning. All rights reserved. May not be scanned, copied or duplicated, or posted to a publically accessible website, in whole or in part.5–16 Cross-Functional Teams Cross-functional teamsCross-functional teams  Composed of individuals from various functional areas such as engineering, production, finance, and marketing who share a common purpose. Benefits:Benefits:  Help organizations focus on a core business process, such as new-product development.  Reduce the tendency for employees to focus single- mindedly on an isolated functional activity.  Help to better communicate customers’ desires and opinions across the firm.

17. © 2010 South-Western/Cengage Learning. All rights reserved. May not be scanned, copied or duplicated, or posted to a publically accessible website, in whole or in part.5–17 Research Suppliers and Contractors Research SuppliersResearch Suppliers  Commercial providers of research services. Syndicated ServiceSyndicated Service  A research supplier that provides standardized information for many clients in return for a fee. Standardized Research ServiceStandardized Research Service  Companies that develop a unique methodology for investigating a business specialty area.  example: Retail Forward

18. © 2010 South-Western/Cengage Learning. All rights reserved. May not be scanned, copied or duplicated, or posted to a publically accessible website, in whole or in part.5–18 Limited Research Service Companies and Custom Research Limited-Service Research SuppliersLimited-Service Research Suppliers  Specialize in particular research activities, such as syndicated service, field interviewing, data warehousing, or data processing.  Full-service research suppliers sometimes contract these companies for ad hoc (custom) marketing research projects. Custom researchCustom research  Projects that are tailored specifically to a client’s unique needs.

19. © 2010 South-Western/Cengage Learning. All rights reserved. May not be scanned, copied or duplicated, or posted to a publically accessible website, in whole or in part.5–19 Ethical Issues in Business Research Business ethicsBusiness ethics  The application of morals to behavior related to the exchange environment. Moral standardsMoral standards  Principles that reflect beliefs about what is ethical and what is unethical. Ethical dilemmaEthical dilemma  A situation in which one chooses from alternative courses of actions, each with different ethical implications.

20. © 2010 South-Western/Cengage Learning. All rights reserved. May not be scanned, copied or duplicated, or posted to a publically accessible website, in whole or in part.5–20 Ethical Issues in Business Research (cont’d) RelativismRelativism  A term that reflects the degree to which one rejects moral standards in favor of the acceptability of some action.  This way of thinking rejects absolute principles in favor of situation-based evaluations. IdealismIdealism  A term that reflects the degree to which one bases one’s morality on moral standards.  example: the Golden Rule

21. © 2010 South-Western/Cengage Learning. All rights reserved. May not be scanned, copied or duplicated, or posted to a publically accessible website, in whole or in part.5–21 General Rights and Obligations of Concerned Parties Everyone involved in research can face an ethical dilemma:Everyone involved in research can face an ethical dilemma:  The people actually performing the research—the “doers.”  The research client, sponsor, or the management team requesting the research—the “users.”  The research participants—the actual research respondents or subjects. Each party has certain rights and obligations toward the other parties.Each party has certain rights and obligations toward the other parties.

22. © 2010 South-Western/Cengage Learning. All rights reserved. May not be scanned, copied or duplicated, or posted to a publically accessible website, in whole or in part.5–22 EXHIBIT 5.7 Interaction of Rights and Obligations

23. © 2010 South-Western/Cengage Learning. All rights reserved. May not be scanned, copied or duplicated, or posted to a publically accessible website, in whole or in part.5–23 Rights and Obligations: Research Participant Rights:Rights:  To be informed  To privacy  Protected from harm Obligations:Obligations:  To be truthful Informed ConsentInformed Consent  The individual understands what the researcher wants him/her to do and consents to the research study. ConfidentialityConfidentiality  The information involved in the research will not be shared with others.

24. © 2010 South-Western/Cengage Learning. All rights reserved. May not be scanned, copied or duplicated, or posted to a publically accessible website, in whole or in part.5–24 Deception in Research Designs And the Right To Be Informed Experimental DesignsExperimental Designs  Placebo  A false experimental effect used to create the perception of a true effect.  Debriefing  Research subjects are fully informed and provided with a chance to ask any questions they may have about the experiment.

25. © 2010 South-Western/Cengage Learning. All rights reserved. May not be scanned, copied or duplicated, or posted to a publically accessible website, in whole or in part.5–25 Protection from Harm Questions to ask to help avoid harming a research participant:Questions to ask to help avoid harming a research participant:  Has the research subject provided consent to participate in an experiment?  Is the research subject subjected to substantial physical or psychological trauma?  Can the research subject be easily returned to his or her initial state? Human subjects review committeeHuman subjects review committee  Reviews proposed research designs to ensure that no harm can come to any research participant.

26. © 2010 South-Western/Cengage Learning. All rights reserved. May not be scanned, copied or duplicated, or posted to a publically accessible website, in whole or in part.5–26 Rights and Obligations of the Researcher The researcher should:The researcher should:  Understand that the purpose of research is research (no sales pitch to research participants)  Maintain objectivity  Not misrepresent research  Be honest in reporting errors  Protect the confidentiality of both subjects and clients

27. © 2010 South-Western/Cengage Learning. All rights reserved. May not be scanned, copied or duplicated, or posted to a publically accessible website, in whole or in part.5–27 Research That Isn’t Research Pseudo-researchPseudo-research  Conducted not to gather information for decisions but to bolster a point of view and satisfy other needs. Push pollPush poll  Telemarketing under guise of research. Service monitoringService monitoring  Contacting customers about their experience with a product, there is no selling attempt.

28. © 2010 South-Western/Cengage Learning. All rights reserved. May not be scanned, copied or duplicated, or posted to a publically accessible website, in whole or in part.5–28 EXHIBIT 5.9 How Results Can Be Misrepresented in a Report or Presentation A)Researcher points to a “large” difference in quality ratings. Men report much higher quality service than do women. In contrast, women report only “slightly” less satisfaction than do men. B)The researcher points to a “trivial” difference in quality perceptions between men and women. There is no difference in the satisfaction ratings of men and women.

29. © 2010 South-Western/Cengage Learning. All rights reserved. May not be scanned, copied or duplicated, or posted to a publically accessible website, in whole or in part.5–29 The Researcher and Conflicts of Interest Conflict of interestConflict of interest  Occurs when one researcher works for two competing companies.

30. © 2010 South-Western/Cengage Learning. All rights reserved. May not be scanned, copied or duplicated, or posted to a publically accessible website, in whole or in part.5–30 Rights and Obligations of the Client Sponsor (User) Issues in the client-researcher relationshipIssues in the client-researcher relationship  Ethical behavior between buyer and seller  An open relationship with research suppliers  An open relationship with interested parties  Advocacy research—research undertaken to support a specific claim in a legal action or represent some advocacy group.  Privacy rights of research participants

31. © 2010 South-Western/Cengage Learning. All rights reserved. May not be scanned, copied or duplicated, or posted to a publically accessible website, in whole or in part.5–31 Privacy on the Internet Controversial issueControversial issue Many researchers argue that they don’t need to know who the user is, but they do want to know certain things (e.g., demographics, product usage) associated with an anonymous profile.Many researchers argue that they don’t need to know who the user is, but they do want to know certain things (e.g., demographics, product usage) associated with an anonymous profile. Researchers should not disclose private information without permission from consumers who provided that information.Researchers should not disclose private information without permission from consumers who provided that information.