The Role of Business Research Theory Building by ydo11566

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									The Role of Business Research
      Theory Building
        Some highlights
The scope of business research

    •What is “business” anyway???
 •Is research applicable to all business
Business research defined

  • the systematic and objective
    process of gathering, recording,
    and analyzing data for aid in
    making business decisions
            Types of research
         PURE                     APPLIED
• expand the limits of     • aimed at solving a
  knowledge                  specific pragmatic
• not aimed at solving a     problem
  specific pragmatic       • “action research” is
  problem                    one type
• theory development
• identifying problems or opportunities
• diagnosis and assessment
• selecting and implementing a course of
• evaluating a course of action
  – Evaluation
     • Performance monitoring
  Research isn’t always the answer!

• Before doing research consider the
  –   time constraints
  –   availability of data
  –   nature of the decision
  –   has the decision already been made?
  –   does the cost outweigh the benefit?

A coherent set of general propositions used as principles of
explanation of the apparent relationships of certain observed
    What makes a good theory?
• Validity
  – It fits the facts
• Generalization
  – Makes predictions about future or other events
• Replication
  – It can be repeated with similar findings
• In management we often use concepts or
  constructs as variables
• examples:
  –   leadership
  –   social responsibility
  –   GNP
  –   agency
  –   honesty
  –   efficiency
• Concepts abstract reality
  – Are expressed in words that refer to various
    events or objects
  – Vary in degree of abstraction
     • Ladder of abstraction
  – Research operates at abstract and empirical
    level linking concepts together as we begin the
    journey to construct theory.
• Concepts are the basic building blocks
• Propositions propose the linkages between
  these concepts


     From proposition to hypothesis

Proposition   Concept A:      Concept B:   Abstract
              Punishment      Attendance   Level

Hypothesis Yelling at      Increases       Emperical
           students        attendance by   Level
   A hypothesis is a proposition that is empirically testable.
   It is an empirical statement concerned with the
   relationship among variables.

•A variable is anything that… varies!
•Make sure that you define, or operationalize all your
variables… an operational definition
•Null hypothesis
   The Origin of the Hypothesis
• Is said to date from the time of Plato
  (428-347BC), a Greek philosopher.

• Plato believed one should develop a
  belief and then test it by observation.
            The earth is flat!
• The medieval church depicted the earth as
• This was linked to religious and other beliefs
  in a limited world. They used deductive
  reasoning based not on fact but on their own
• Copernicus, Galileo and others helped prove
  the earth was anything other than flat.
• The faulty hypothesis did not fit the facts, but
  it held sway over generations till it was shown
  to be false.
 What makes a good hypothesis?
• precise

• specifies variables to measure

• specifies relationships between
         A poor hypothesis
• Students spend too much money on fast
         A better hypothesis
• Students with incomes of less than 10,000
  per year spend a higher proportion of their
  income in fast food restaurants than the
  established mean for the general population.
          Research questions
• Are often used when you are not sure of a
  specific hypothesis, you need to generalise

• Helps focus on the problem and identifies
  what can be measured

• Whereas there is normally a single
  hypothesis, there are normally multiple
  research questions
Theory Formulation

Deductive Reasoning
The logical process of deriving a conclusion from a known premise
or something known to be true.
    We know that all managers are human beings.
    If we also know that John Smith is a manager,
    then we can deduce that John Smith is a human being.
                                              Subject to error!
Inductive Reasoning

The logical process of establishing a general proposition on
the basis of observation of particular facts.
    All managers that have ever been seen are human beings;
     therefore all managers are human beings.

                                        Subject to error too!
 Double Movement of reflexive
• Induction occurs when we observe a fact
  and ask “why”
• To answer this we develop a tentative
  hypothesis as the explanation
• Deduction is the process whereby we test
  the hypothesis

Theories are nets cast to catch what we call “the world”: to
rationalize, to explain, and to master it. We endeavor to make
the mesh ever finer and finer.
                                                 Karl R. Popper

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