All businesses engage in some form of research activities to help improve its business processes and or to expand its current operations; therefore developing an understanding of the relationship between research and business decisions helps to ensure that the business is a success. Business research fulfils the manager’s need for knowledge of the organization, the market, the economy and many other areas of uncertainty experienced when making business decisions. Business research can also help to predict how individuals, markets, organizational units or other entities will respond to the decisions made by the business.
Business research is thought to be the systematic and objective process of gathering, recording, and analysing data for aid in business decision making. The main emphasis of business research is to provide scientific, impersonal and objective information in order to shift decision makers from risky intuitive decisions to decisions based on systematic and objective investigations. There are two types of business research methods that can be used in business, the pure or basic research and the applied research.
Basic research attempts to expand the limits of knowledge and is used by decision makers who just need to gain an idea of a particular situation or area of interest. This type of research has little direct impact on job performance or the decisions taken within the business. On the other hand, applied research is conducted when the decision involves a specific real life problem; it is used to answer specific problems or to make a decision about a particular course of action. They manager may need to decide if the time is right to expand it operations to another area of the country.
Business research is a management tool that exerts a major influence on the decision making process. The process of decision making involves developing and deciding among alternative ways of resolving a problem or choosing from among alternative opportunities. Organisations make decisions in order to capitalize on any opportunity or reduce any negative impact related to a business problem, in this way business research can address practical issues of the business by providing information that facilitates decision making about strategies and the tactics that can be used to achieve a company’s strategic goals.
The decision maker must have an idea of the nature of the opportunity or problem faced by the business in order to determine what or how much information is needed to deal with the situation. A decision of whether a research should be conducted to address the opportunities or problems will also be based on the time constraints faced by the manager, the availability of the type of information that is needed to address the issues at hand, the nature of the decision to be made and more importantly, the cost versus the benefit that the organisation will incur.
The decision making process involves four main stages; the decision maker needs to identify the existence of problems and or opportunities, diagnose and assess the identified problem or opportunity, select and implement a course of action that will adequately address the problems or opportunities and evaluate the chosen course of action. An evaluation is done to ensure that the information provided from the research process will be objective, accurate and both qualitative and quantitative in order to reduce the decision makers’ uncertainty and the making of incorrect decisions.
Research is an important aspect of a business’s decision making process especially when it comes to making major structural changes or developing a new product line. In the event that a manager realises the opportunity to expand its business operations by creating a new store in a particular location, the decision maker must rely on extensive information about actual consumer needs for that location. In some cases however, an effective business manager must also be able to recognize some of the weaknesses of research and rely on their own experience or intuition to guide these decisions.
Upon realising an opportunity to expand its operations, a very important aspect of business research is the provision of information to diagnose and assess the problems or opportunities at hand. This information would be useful in clarifying and refining the nature of the opportunity; the decision maker may need the research question to examine the specific needs of the customers in that location and if the business would be able to adequately provide for these needs. If a problem existed, the manager may need the research information to gain insight about the underlying factors that caused the situation and what can be done to alleviate it.
Business research is conducted to obtain specific information to assist in evaluating the various alternatives to problems and opportunities and to select the best course of action based on the needs of the business. Once the decision maker has all the relevant research information, he is better able to select and implement a course of action that will fulfil the strategic goals of the business. The manager may have found out that the location does not need a full time store and so may decide to rent a mobile unit to facilitate the customers business transaction at the specified times needed.
This would be less costly for the business while still generating income and helping the business to secure a solid place in their market. When all decisions have been made and plans carried out accordingly, managers or decision makers must evaluate their course of action, this is done so that it can be ascertained whether they accomplished what they had set out to do. Conducting an evaluation research serves as a control mechanism and provides feedback for further evaluation and control of business activity.
If the research indicates that things are not going as planned, the further research may be required to explain why something went wrong. There are various strategies for evaluating a course of action; an evaluation research is a formal objective measurement and appraisal of the extent to which a given activity has achieved its objectives. Another of these evaluation techniques is performance-monitoring research; this is a special type of research that regularly provides feedback for evaluation and control of business activity and also provides information about major factors that affect performance.
Total quality management can also be used as a valuation technique; this is a business philosophy that focuses on integrating customer-driven quality throughout the organization. Business research is an essential aspect of total quality management that is used in the decision making process. Total quality management embodies the belief that the management process must focus on integrating the idea of customer-driven quality throughout the organization.
Total quality management stresses continuous improvement of product quality and service in an effort to improve durability and enhance products with additional features as the product ages. Thus, business research information concerning external customers and with employees in the organization (internal customers) is very important in the decision about how best to meet the market’s demands. While business research is highly useful to guide business decisions, managers should use it as an aid to decision making and review it with an awareness of potential weaknesses.
Many errors can arise in the business research process. For example, if a problem is inaccurately stated in a particular study, the questions researchers ask may not be relevant to the business’ actual challenges or provide further insight into an opportunity. In another situation, the variables business researchers are able to examine may not actually be useful for making conclusions. It’s important to remember that research is often only as good as the data available, and that it must sometimes be used with caution.
