Ebook Research methods for business (7/E): Part 1

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Research Methods
for Business
Seventh Edition


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Research Methods
for Business
A Skill-Building Approach
Seventh Edition

Uma Sekaran
and
Roger Bougie


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Copyright © 2016, 2013 John Wiley & Sons Ltd.
All effort has been made to trace and acknowledge ownership of copyright. The publisher would be glad to hear from any
copyright holders whom it has not been possible to contact.
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The rights of Uma Sekaran and Roger Bougie to be identified as the authors of this work have been asserted in accordance
with the UK Copyright, Designs and Patents Act 1988.
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competent professional should be sought.
Library of Congress Cataloging‐in‐Publication Data
Names: Sekaran, Uma, author. | Bougie, Roger, author.
Title: Research methods for business : a skill-building approach / Uma
Sekaran and Roger Bougie.
Description: Seventh edition. | Chichester, West Sussex, United Kingdom :
John Wiley & Sons, [2016] | Includes bibliographical references and index.
Identifiers: LCCN 2015051045 | ISBN 9781119165552 (pbk.)
Subjects: LCSH: Business—Research—Methodology.
Classification: LCC HD30.4 .S435 2016 | DDC 650.072—dc23 LC record available at />ISBN: 9781119165552 (pbk)
ISBN: 9781119266846 (ebk)
A catalogue record for this book is available from the British Library.
Set in 10/12 Minion Pro by SPi Global
Printed and bound in Italy by Printer Trento Srl.


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CONTENTS

About the Authors
Preface
Acknowledgments

1 Introduction to research

Introduction

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xxiii
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Knowledge about research and managerial effectiveness
Ethics and business research
Summary
Discussion questions
Case: The Laroche Candy Company

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2 The scientific approach and alternative approaches to investigation

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Introduction
The hallmarks of scientific research

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Business research
The role of theory and information in research
Research and the manager

Types of business research: applied and basic
Applied research
Basic or fundamental research

Managers and research

Why managers need to know about research
The manager and the consultant–researcher

Internal versus external consultants/researchers
Internal consultants/researchers
Advantages of internal consultants/researchers
Disadvantages of internal consultants/researchers
External consultants/researchers
Advantages of external consultants/researchers
Disadvantages of external consultants/researchers

Purposiveness
Rigor
Testability
Replicability
Precision and confidence

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viii contents

Summary
Discussion questions

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3 Defining and refining the problem

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Introduction
The broad problem area
Preliminary research

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Objectivity
Generalizability
Parsimony

The hypothetico-deductive method
The seven-step process in the hypothetico-deductive method
Identify a broad problem area
Define the problem statement
Develop hypotheses
Determine measures
Data collection
Data analysis
Interpretation of data
Review of the hypothetico-deductive method
Some obstacles to conducting scientific research in the management area

Alternative approaches to research
Positivism
Constructionism
Critical realism
Pragmatism
Conclusion

Nature of information to be gathered
Background information on the organization
Information on the topic or subject area

Defining the problem statement
What makes a good problem statement?
Basic types of questions: exploratory and descriptive
Exploratory research questions
Descriptive research questions
Causal research questions

The research proposal
Managerial implications
Ethical issues in the preliminary stages of investigation
Summary
Discussion questions


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contents

ix

4 The critical literature review

51

Introduction
How to approach the literature review

Ethical issues
Summary
Discussion questions
Practice project
Appendix
Some online resources useful for business research
Bibliographical databases
Apa format for referencing relevant articles
Referencing and quotation in the literature review section

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5 Theoretical framework and hypothesis development

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Introduction
The need for a theoretical framework
Variables

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Data sources
Textbooks
Journals

Theses
Conference proceedings
Unpublished manuscripts
Reports
Newspapers
The Internet
Searching for literature
Evaluating the literature
Documenting the literature review

Dependent variable
Independent variable
Moderating variable
The distinction between an independent variable
and a moderating variable
Mediating variable

How theory is generated
The components of the theoretical framework

Hypothesis development
Definition of a hypothesis
Statement of hypotheses: formats
If–then statements

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Managerial implications
Summary
Discussion questions
Practice project

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6 Elements of research design

95

Directional and nondirectional hypotheses
Null and alternate hypotheses

Introduction
The research design
Elements of research design

Mixed methods
Trade-offs and compromises
Managerial implications
Summary
Discussion questions

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7 Interviews

111

Introduction
Primary data collection methods
Interviews

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Research strategies
Experiments
Survey research
Ethnography
Case studies
Grounded theory
Action research
Extent of researcher interference with the study
Study setting: contrived and noncontrived
Unit of analysis: individuals, dyads, groups, organizations, cultures

Time horizon: cross-sectional versus longitudinal studies
Cross-sectional studies
Longitudinal studies

Unstructured and structured interviews
Unstructured interviews
Structured interviews
Review of unstructured and structured interviews
Training interviewers
Some tips to follow when interviewing
Establishing credibility and rapport, and motivating individuals to respond
The questioning technique
Review of tips to follow when interviewing


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Advantages and disadvantages of interviews
Summary
Discussion questions

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8 Data collection methods: Observation

126

Introduction
Definition and purpose of observation
Four key dimensions that characterize the
type of observation

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Face-to-face and telephone interviews
Face-to-face interviews: advantages and disadvantages
Telephone interviews: advantages and disadvantages
Additional sources of bias in interview data
Computer-assisted interviewing
CATI and CAPI
Software packages
Group interviews
Focus groups
Expert panels

Advantages and disadvantages of observation
Summary
Discussion questions

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9 Administering questionnaires

142

Introduction
Types of questionnaires

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146

Controlled versus uncontrolled observational studies
Participant versus nonparticipant observation
Structured versus unstructured observational studies
Concealed versus unconcealed observation

Two important approaches to observation
Participant observation: introduction
The participatory aspect of participant observation
The observation aspect of participant observation
What to observe
Structured observation: introduction
The use of coding schemes in structured observation

Personally administered questionnaires
Mail questionnaires
Electronic and online questionnaires

Guidelines for questionnaire design
Principles of wording
Content and purpose of the questions


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xii contents
Language and wording of the questionnaire
Type and form of questions
Sequencing of questions
Classification data or personal information
Principles of measurement
General appearance or “getup” of the questionnaire
Review of questionnaire design
Pretesting of structured questions
Electronic questionnaire and survey design

International dimensions of surveys
Special issues in instrumentation for cross-cultural research
Issues in cross-cultural data collection

Review of the advantages and disadvantages of different
data collection methods and when to use each
Multimethods of data collection
Managerial implications
Ethics in data collection

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Summary
Discussion questions

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10 Experimental designs

165

Introduction
The lab experiment

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Ethics and the researcher
Ethical behavior of respondents

Control
Manipulation
Controlling the contaminating exogenous or “nuisance” variables
Matching groups
Randomization
Internal validity of lab experiments
External validity or generalizability of lab experiments

The field experiment
External and internal validity in experiments
Trade-off between internal and external validity
Factors affecting the validity of experiments

History effects
Maturation effects
Testing effects
Selection bias effects
Mortality effects
Statistical regression effects
Instrumentation effects
Identifying threats to validity


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Review of factors affecting internal and external validity

Types of experimental design and validity
Quasi-experimental designs
Pretest and posttest experimental group design
Posttests only with experimental and control groups
Time series design
True experimental designs
Pretest and posttest experimental and control group design
Solomon four-group design
Double-blind studies
Ex post facto designs

Simulation
Ethical issues in experimental design research
Managerial implications
Summary
Discussion questions

Appendix: Further experimental designs
The completely randomized design
Randomized block design
Latin square design
Factorial design

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11 Measurement of variables: Operational definition

193

Introduction
How variables are measured
Operational definition (operationalization)

193
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Operationalization: dimensions and elements
Operationalizing the (multidimensional) concept of achievement motivation
Dimensions and elements of achievement motivation
What operationalization is not
Review of operationalization

196
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International dimensions of operationalization
Summary
Discussion questions

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12 Measurement: Scaling, reliability and validity

206

Introduction
Four types of scales

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Nominal scale
Ordinal scale
Interval scale
Ratio scale


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xiv contents
Ordinal or interval?
Review of scales

Rating scales
Dichotomous scale
Category scale
Semantic differential scale

Numerical scale
Itemized rating scale
Likert scale
Fixed or constant sum scale
Stapel scale
Graphic rating scale
Consensus scale
Other scales

Ranking scales
Paired comparison
Forced choice
Comparative scale

International dimensions of scaling
Goodness of measures
Item analysis
Validity
Content validity
Criterion-related validity
Construct validity
Reliability
Stability of measures
Internal consistency of measures

Reflective versus formative measurement scales
What is a reflective scale?
What is a formative scale and why do the items of a formative scale not necessarily hang together?

Summary

Discussion questions
Appendix: Examples of some measures
Measures from behavioral finance research
Measures from management accounting research
Measures from management research
Measures from marketing research

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13 Sampling

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Introduction
Population, element, sample, sampling unit, and subject

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Population

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Element
Sample
Sampling unit
Subject

Sample data and population values
Parameters
Representativeness of Samples
Normality of Distributions

The sampling process
Defining the population
Determining the sample frame
Determining the sampling design
Determining the sample size
Executing the sampling process

Probability sampling
Unrestricted or simple random sampling
Restricted or complex probability sampling
Systematic sampling
Stratified random sampling
Cluster sampling
Double sampling
Review of probability sampling designs

Nonprobability sampling
Convenience sampling

Purposive sampling
Judgment sampling
Quota sampling
Review of nonprobability sampling designs

Intermezzo: examples of when certain sampling designs would be appropriate
Simple random sampling
Stratified random sampling
Systematic sampling
Cluster sampling
Area sampling
Double sampling
Convenience sampling
Judgment sampling: one type of purposive sampling
Quota sampling: a second type of purposive sampling

Issues of precision and confidence in determining sample size
Precision
Confidence
Sample data, precision, and confidence in estimation
Trade-off between confidence and precision

Sample data and hypothesis testing

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The sample size

Sampling as related to qualitative studies
Managerial implications
Summary
Discussion questions

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14 Quantitative data analysis

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Introduction
Getting the data ready for analysis

Excelsior enterprises: descriptive statistics part 2
Summary
Discussion questions

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15 Quantitative data analysis: Hypothesis testing

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Introduction
Type I errors, type II errors, and statistical power
Choosing the appropriate statistical technique

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Determining the sample size
Sample size and type II errors
Statistical and practical significance
Rules of thumb
Efficiency In Sampling

Coding and data entry
Coding the responses
Data entry
Editing data

Data transformation

Getting a feel for the data
Frequencies
Bar charts and pie charts
Measures of central tendency and dispersion
Measures of central tendency
Measures of dispersion
Relationships between variables
Relationship between two nominal variables: χ2 test
Correlations

Excelsior enterprises: descriptive statistics part 1
Testing the goodness of measures
Reliability
Excelsior Enterprises: checking the reliability of the multi-item measures
Validity

Testing a hypothesis about a single mean


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Data warehousing, data mining, and operations research
Some software packages useful for data analysis
Summary
Discussion questions

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16 Qualitative data analysis

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Introduction
Three important steps in qualitative data analysis

Big data
Summary
Discussion questions

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17 The research report

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Introduction
The written report

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Testing hypotheses about two related means
Testing hypotheses about two unrelated means
Testing hypotheses about several means
Regression analysis
Standardized regression coefficients
Regression with dummy variables
Multicollinearity
Testing moderation using regression analysis: interaction effects
Other multivariate tests and analyses
Discriminant analysis
Logistic regression
Conjoint analysis
Two-way ANOVA
MANOVA
Canonical correlation

Excelsior enterprises: hypothesis testing
Overall interpretation and recommendations to the president

Data reduction
Data display
Drawing conclusions

Reliability and validity in qualitative research
Some other methods of gathering and analyzing qualitative data
Content analysis
Narrative analysis
Analytic induction

The purpose of the written report

The audience for the written report


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xviii contents
Characteristics of a well-written report

Contents of the research report
The title and the title page
The executive summary or abstract
Table of contents
List of tables, figures, and other materials
Preface
The authorization letter
The introductory section
The body of the report
The final part of the report
References
Appendix

Oral presentation
Deciding on the content
Visual aids
The presenter
The presentation
Handling questions

Summary
Discussion questions
Appendix: Examples

Report 1: sample of a report involving a descriptive study
Report 2: sample of a report offering alternative solutions and explaining
the pros and cons of each alternative
Report 3: example of an abridged basic research report
A Final Note to Students
Statistical Tables
Glossary
Bibliography
Index

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ABOUT THE AUTHORS

Uma Sekaran was Professor Emerita of Management, Southern Illinois University at Carbondale (SIUC), Illinois.
She obtained her MBA degree from the University of Connecticut at Storrs, and her PhD from UCLA. She was
the Chair of the Department of Management and also the Director of University Women’s Professional
Advancement at SIUC when she retired from the University and moved to California to be closer to her family.
Professor Sekaran authored or co‐authored eight books, 12 book chapters, and more than 55 refereed journal
articles in the management area, and presented more than 70 papers at regional, national, and international
management conferences. She also won recognition for significant research contributions to cross‐cultural
research from US and international professional organizations. She received Meritorious Research Awards both
from the Academy of Management and SIUC, and was conferred the Best Teacher Award by the University.
Roger Bougie is Associate Professor at the TIAS School for Business and Society (Tilburg University, The
Netherlands), where he teaches executive courses in Business Research Methods. He has received a number of
teaching awards, including the Best Course Award for his course on Business Research Methods. Dr Bougie’s
main research interest is in emotions and their impact on consumer behavior, service quality, and satisfaction.
Dr Bougie authored or co‐authored numerous papers, books, book chapters, and cases in the area of Marketing

and Business Research Methods. Dr Bougie is ad hoc reviewer for the Journal of the Academy of Marketing
Science, the Journal of Business Research, the Journal of Marketing Research, and Marketing Letters.

xix


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PREFACE

I have used previous editions of this book in various research methods courses with great success. For many years
the book has helped thousands of my own students (undergraduate students, graduate students, and executive
students), as well as many more around the world, to carry out their research projects. The great strength of
Research Methods for Business is that students find it clear, informal, easy to use and unintimidating. I have tried
to maintain these strengths in this seventh edition.

CHANGES IN THE SEVENTH EDITION
The seventh edition of Research Methods for Business has been thoroughly revised.
●

●
●

●

Chapter  3 (Defining and Refining the Problem), Chapter  4 (The Critical Literature Review), Chapter  6
(Elements of Research Design), Chapter  7 (Interviews), Chapter  9 (Administering Questionnaires), Chapters  14

and 15 (Quantitative Data Analysis), and Chapter 17 (The Research Report) have been substantially modified
and updated in this edition.
Examples, exercises, and other pedagogical features have been revised and updated in all the chapters.
The structure of the book has not changed, but the storyline has been greatly improved. As in previous editions,
the accessible and informal style of presenting information has been maintained and the focus on practical
skill building preserved.
Chapter 2 introduces and discusses alternative approaches to research. In the new edition, subsequent chapters
follow up on this by reviewing a range of topics (such as research questions, research design, and measurement)
from various perspectives. This allows users of this book to recognize and develop their personal ideas on
research and how it should be done, to determine which kinds of research questions are important to them, and
what methods for collecting and analyzing data will give them the best answers to their research questions.

The book provides numerous examples to illustrate the concepts and points presented. Users will also note
the variety of examples from different areas of the world as well as different areas of business – human resources
management, strategic management, operations management, management control, marketing, finance, accounting,
and information management.
Most chapters in the book include managerial implications of the contents discussed, emphasizing the need
for managers to understand research. The ethical considerations involved in conducting research are also clearly
brought out. The dynamics of cross‐cultural research in terms of instrument development, surveys, and sampling are discussed, which, in the context of today’s global economy, will be useful to students.
We expect that students and instructors alike will enjoy this edition. Students should become effective
researchers, helped by the requisite knowledge and skills acquired by the study of this book. Finally, it is hoped
that students will find research interesting, unintimidating, and of practical use.

HOW TO USE THIS SEVENTH EDITION
You can read this book in a variety of ways, depending on your reasons for using this book.
If the book is part of a Business Research Methods course, the order in which you read the chapters will be
prescribed by your instructor.

xxi

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xxii PREFACE
If you are reading the book because you are engaged in a project (a consultancy project, a research project,
or a dissertation) then the order in which your read the chapters is your own choice. However, we recommend
that you follow the structure of the book rather closely. This means that we advise you to start with reading the
first three chapters that introduce research, various approaches to what makes good research, and the development of a problem statement and a research proposal. Based on the type of research questions and whether, as a
result of your research questions, your study is either qualitative or quantitative in nature you may decide to read
the book in the following way.
In the case of qualitative research:
4

The critical literature review

6

Research design

7, 8, and/or 9

Data collection methods

13

Sampling

16

Qualitative data analysis

17

The research report

In the case of quantitative research:
4

The critical literature review

5

Theoretical framework

6

Research design

9

Questionnaires

10

Experimental designs

11 and 12

Measurement and Scaling

13

Sampling

14 and 15

Quantitative data analysis

17

The research report

COMPANION WEBSITES
Lecturers and students have a dedicated companion website available at www.wiley.com/college/sekaran.
Lecturers will find a range of bespoke video material, developed by the author to provide extra explanation
on difficult topics; videos are signposted in the text. The lecturer website also houses additional case studies
related to each chapter, including accompanying cases for the three new chapters. There is also an extensive test
bank for lecturers, a comprehensive set of PowerPoint slides to accompany the new edition, and an instructor’s
manual, which offers an up‐to‐date and valuable additional teaching aid.
Students will find an online glossary and flashcards, which are useful for self‐study and revision. In addition,
the student website provides self‐test quizzes with over 250 questions for students to use while studying outside
the classroom.


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PREFACE xxiii

ACKNOWLEDGMENTS
Working on the seventh edition of Research Methods for Business has been a positive and rewarding experience.
Many people have contributed to this in many different ways. Thank you colleagues at Tilburg University and
the TIAS School for Business and Society for your feedback on earlier versions of this book. Thank you for

providing me with a pleasant, professional and inspiring work environment. Thank you dear students for the
lively and inspiring discussions we have had during the past twenty years; I have learned a lot from these discussions. Thanks everybody at John Wiley & Sons, in particular Steve Hardman, for your support, your patience,
and your confidence. Thank you reviewers for your constructive and insightful comments on earlier drafts of
this book.
Roger Bougie