Chapter Objective

After studying this chapter, you should be able to

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 that technology and internationalization are
changing business research

Japanese love Starbucks – But

Starbucks Coffee Company Why?
Starbucks became the largest coffeehouse chain in the world because of its ✔entered Japan in 1996
value for business research.
✔50-50 joint venture with Sazaby
Starbucks’s market research approach includes: League
Tracking cultural trends ✔Smaller serving sizes on the menu
Monitoring social media ✔Lower sugar levels
Gathering customer feedback ✔Additional matcha-flavored items
In-store product testing ✔Premium products at a
budget-friendly price
Over the past 14 years, Starbucks has used market research by obtaining
consumer feedback through its My Starbucks Idea platform. ✔Call customers by a number
instead of their name to pick up
their order
 Apple Inc. Apple Inc.
For years, it was been widely believed that Apple didn’t conduct ▪To begin with, the notion that Apple doesn’t conduct research is a false
market/Business research. one.
▪Though Jobs had famously stated that “it [wasn’t] the consumer’s job
In fact, the late Steve Jobs had a somewhat dismissive attitude to know what they want,” market research would turn out to be
towards focus groups. He reiterated that “customers don’t know instrumental to developing the iPhones 4 and 5 and the iPad.
what they want until you show it to them,” which really raised
▪In fact, Apple’s marketing data is typically gathered by extensively
the questions: how is it that Apple makes great products even studying consumer behavior insight.
though they aren’t invested in market research and what is it about
Apple that makes them so successful? ▪To protect itself from competitors, Apple’s marketing research is a
well-guarded secret.

Business Research Defined Business Research

Research information is neither intuitive nor haphazardly gathered.
Business research is defined as the systematic and objective
process of generating information (gathering, recording and Literally, research (re-search) -“search again”
analyzing data) for aid in making business decisions. Business research must be objective
Detached and impersonal rather than biased
The application of the scientific method in searching for the It facilitates the managerial decision process for all aspects of a
truth about business phenomena. These activities include business.
defining business opportunities and problems, generating and
evaluating ideas, monitoring performance, and understanding
the business process.
 I don’t
know
if we Business Research Types
should
offer
1.Basic research
Information on-site
child 2.Applied research
Reduces care?

Uncertainty
 Basic Research Basic Research Example
❑Attempts to expand the limits of knowledge. ❖A study of how stress affects labor productivity.
❑Not directly involved in the solution to a pragmatic problem. ❖Studying the best factors of pricing strategies.
❖Understand the client’s level of satisfaction before certain interactions
with the company providing solutions.
Research conducted without a specific decision in mind that usually does not
address the needs of a specific organization. It attempts to expand the limits ❖The understanding of the leadership style of a particular company.
of knowledge in general and is not aimed at solving a particular pragmatic
problem.
Basic Research is a type of research used in the scientific field to understand
and extend our knowledge about a specific phenomenon or field. It is also
accepted as pure investigation or fundamental research.

Examples of Basic Research: Applied Research

1⃣ Physics: Studying the properties of subatomic particles (e.g., how electrons behave ▪Conducted when a decision must be made about a specific
in different conditions). real-life problem.
2⃣ Biology: Studying how human cells divide and function.
3⃣ Chemistry: Studying the structure of new chemical compounds without focusing
on direct use. ❑Research conducted to address a specific business decision
for a specific firm or organization.
4⃣ Social Sciences: Understanding how language evolved over time.
5⃣ Economics & Business: Exploring how consumer behavior changes with economic
growth. Studying the impact of cultural values on global trade. ❖Applied research is a type of examination looking to find
practical solutions for existing problems. These can
include challenges in the workplace, education and
society.
 Applied Research Examples
Should McDonalds add Italian pasta dinners to its menu? Vaccine research for COVID-19
Business research told McDonald’s it should not?
Should Procter & Gamble add a high-priced home teeth
bleaching kit to its product line? Applied or Basic ??
A study searching for ways to encourage high school
graduates to attend college
A study to find ways to make car tires last longer

Basic Research: Vaccine research for COVID-19.

Understanding the virus: Scientists initially conducted basic research to understand the
SARS-CoV-2 virus, its structure, and how it interacts with the human immune system.
Mechanisms of infection: Basic research helps in uncovering the mechanisms by which In summary, while basic research lays the groundwork for understanding
the virus enters cells and spreads within the body. the virus and the immune response, applied research takes this
Immunology studies: Basic research is crucial for understanding the immune response to knowledge and applies it to develop, test, and distribute vaccines for
the virus, including how the immune system recognizes and responds to the virus. real-world use. The rapid development and deployment of COVID-19
vaccines demonstrate the close interplay between basic and applied
Applied Research: research in addressing global health challenges.
Vaccine development: Applied research involves the practical application of knowledge
gained from basic research to develop vaccines that can prevent COVID-19.
Clinical trials: Conducting clinical trials to test the safety and efficacy of vaccines in
human populations is a key aspect of applied research.
Manufacturing and distribution: Once a vaccine proves effective, applied research focuses
on optimizing manufacturing processes and establishing distribution strategies to ensure
widespread availability.
Applied Research Scope Applied Research Scope
Research on a country's specific problem is typically classified as For example, if researchers are studying economic
applied research. Applied research is conducted with the goal of solving challenges, healthcare issues, or environmental
practical problems, addressing specific issues, or meeting the immediate
needs of a particular context. It aims to provide practical solutions or problems within a specific country, and their aim is to
contribute directly to addressing real-world challenges. propose actionable solutions, then it is considered
applied research. The findings from applied research
In the context of a country-specific problem, applied research would
involve studying the problem in-depth, analyzing potential solutions, and
are intended to have direct relevance and impact on
developing strategies that can be implemented to address the issues at the specific situation or context being studied.
hand. This type of research is often more focused on practical outcomes
and direct applications, as opposed to the broader theoretical inquiries
associated with basic research.

Scientific Method
The analysis and interpretation of empirical evidence (facts from
observation or experimentation) to confirm or disprove prior
conceptions.
 The Decision-making Process Associated with
the Development and Implementation of a
Strategy

▪Identifying problems and opportunities

▪Diagnosis and assessment
▪Selecting and implementing a course of action
▪Evaluating the course of action

Performance-monitoring
Evaluation Research Research
Evaluation research is the formal, objective measurement Research that regularly provides feedback for evaluation
and control
and appraisal of the extent to which a given activity, project,
Indicates things are or are not going as planned
or program has achieved its objectives.
Research may be required to explain why something “went
wrong”
Total Quality Management
(TQM) TQM
A business philosophy that embodies the belief that the Stresses continuous improvement of product quality and
management process must focus on integrating service.
customer-driven quality throughout the organization. Managers improve durability and enhance features as the
product ages.
Managers strive to improve delivery and other services to keep
their companies competitive

Determining When to Conduct Determining When to Conduct Business

Business Research Research
Availability of Data Benefits
▪Time constraints Time Constraints
Is sufficient
Nature of the Decision vs. Costs
Does the
value
time Is the infor- Is the decision Conductin
▪Availability of data
of the
available Yes mation already Yes of Yes Yes
before on hand considerable
research g
information
▪Nature of the decision a managerial
decision
inadequate
for making
strategic
or tactical
exceed the
Business
cost Research
must be the decision? importance?
▪Benefits versus costs made?
of conducting
research?

No No No No

Do Not Conduct Business Research

 Value versus Costs Value Should Exceed Estimated Costs
Potential Value of a Business Research Effort Should Exceed Costs
Value •Research
Its Estimated Costs. •Decreased certainty
expenditures
•Delay of business
•Increased likelihood
decision and
of a correct decision
possible disclosure
•Improved business
of information to
performance and
rivals
resulting higher
•Possible erroneous
profits
research results

Major Topics for Research in

Business Cross-functional Teams
General Business Conditions and Corporate Research Cross-functional teams are composed of individuals from
various organizational departments such as engineering,
Financial and Accounting Research production, finance, and marketing who share a common
purpose.
Management and Organizational Behavior Research
Sales and Marketing Research
Information Systems Research
Corporate Responsibility Research
Business Research in the 21st
Century Global Research
▪Increased globalization ▪Business Research is increasingly global
▪Growth of the Internet and other information technologies ▪Market knowledge is essential
▪A.C. Nielsen - more that 67% international business

The Internet
Global Business Research Is Transforming Society
▪General information about country - economic conditions Time is collapsing.
and political climate
Distance is no longer an obstacle.
▪Cultural and consumer factors
Crossing oceans is only a mouse click away.
▪Market and competitive conditions - demand estimation
People are connected 24 hours a day, seven days a week.
"Instantaneous" has a new meaning.
Internet Research
Seeking facts and figures about an issue
“The secret of success is to know something nobody else knows.”
Surveys on Web sites -Aristotle Onassis

End of the Chapter ☺