Business Decision Making - Research Paper Example

Business Decision Making Conducting Credible Research 18 June, 2009 It is essential for every organization to conduct market research when making decisions about their products and services. Research provides a better understanding of what the consumers want, where the products and services currently stand and what product decision should be made in order to make sound business decisions. We can take the example of Thermasilk, a range of hair care products from Unilever and using hypothetical data demonstrate how research and evaluation techniques can be applied to assist in making business decisions about whether the product should be marketed or not. The market research plan needs to clearly state the objectives of the research. In this case the primary reason for which research is being undertaken is to determine that fate of a particular product line. The purpose of the research is to uncover where the product stands in the market with respect to customer preference and based on that information whether it should be marketed further or discontinued. Once the objective is known the second step would be to determine which information is needed and who will provide this information. This research has to unveil what customers think of the product and how well it is doing in the market in terms of reputation and sales. The information will be acquired from both internal and external sources mostly customers, retailers and employees. For this purpose a sample representing all concerned groups will be selected to participate in the research. Each demographic and geographic group will have adequate representation in the sample. For this particular case the females will have a higher ratio than males and likewise the individuals from younger and middle age groups will constitute a major portion of the sample thought the remaining will have significant representation. The information requirement will be met by primary and secondary data, but primary will play a more important role. Secondary research is available from public statistics, magazines, newspapers, published journals, trade associations, annual reports, government conducted researches, other organizations and even the organization's own historical documents. The secondary information for this particular research however, will be collected from internet sources as well as research conducted on similar products or by similar companies. The primary information will be gathered through surveys with the help of structured questionnaires, interviews, focus groups and observation. Data from questionnaires and interviews may be collected at the point of sales and online surveys will also be conducted. The collected information will then be analyzed to reveal statistics, perceptions regarding the product and the product sales trends. All methods used for gathering data will focus on customers, competition and the retailers. Although primary data is both costly and difficult to acquire and is also very time consuming, the information gathered from primary research through questionnaires, interviews and focus groups would provide significant data for the research than the secondary research, since it acquires direct information from the market that is both the consumers as well as the retailers. Understanding the consumers before making product decision is crucial. Primary research is important when making any decisions regarding consumers in order to get specific results. Secondary data is easier to access and acquire and far less costly than primary research, but it will not provide all information necessary for this particular research. The data is insufficient for some aspects of the research and some of it cannot be applied as it is. It will however be acquired to assist in development the questionnaire and sample selection and will also facilitate in making the final decision. Interviews will serves as a means of two way communication between the consumers and the marketers, allowing us to probe deeper to get the information we require. Interviews and focus groups will reveal more the customers' needs and opinion and also serve as a method of gathering input which is critical to the final decision. The questions asked in interviews would be both open and closed. The questionnaire on the other hand will consist mostly of pre-coded closed questions. Using a combination of questions and techniques would provide both statistical information and details about customers and their particular behavior. A combination of both kinds of questions will also make it possible to gather the best possible information to aid the decision making process. The data gathered will be both nominal and ordinal. Nominal data gives each response a code against which the number of responses is counted. The ordinal data provides the respondents comparative scales on which they can highlight their preferences (Brace, 2008). The Interval scale and rating scales will also be used for certain questions. With different types of questions and different kinds of data collection methods a variety of information will be collected and organized for use. This will facilitate the customers in answering the questions and provide us only relevant information which is necessary. The data collected is useful only if it is translated into information which can be used for the business decisions. For this purpose the collected data was analyzed using tables and graphs. These give a graphic representation of the information making it easier to understand and compare. Based on the primary information collected, it would be best to discontinue the product line. Information collected from customers revealed that from among the sample most had tried the product range but had eventually switched to another brand. The reason which can be deduced from the data is the high level of customer dissatisfaction with the products. Majority of the customers had at some point tried the product but were not currently using it. A large number of customers felt that the products were not meeting their needs and a hug e percentage stated that their needs were not being met at all. The data also revealed that majority of the customers were not willing to give the product a chance even if the product was changed; only a small percentage said they would switch back to Thermasilk. A huge number of users also stated that they would readily switch to other brands if they were offered similar product features by the competing brand. The information collected from customers reveals that it would not be suitable for the company to continue marketing Thermasilk since there seems to be a high level of dissatisfaction with the product. This information along with that obtained from secondary sources can be used for decisions regarding the product as to whether it should be improved of discarded altogether. Reference Brace, I 2008. Questionnaire Design: How to Plan, Structure and Write Survey Material for Effective Market Research. Published by Kogan Page Publishers Appendix Questionnaire Gender Male Female Age 15-20 21-30 31-40 41-50 Have you ever used Thermasilk range of products' Yes No Are you a Thermasilk user' Yes No To what extent does the product meet your needs' All Not all Average Only a few Not at all If the product was changed would you be willing to switch from your current brand' Yes No Would you switch to another brand if it offered the same characteristics as this one' Yes No Is there anything you specifically dislike about the product' What was your reason for switching to another brand' _____________________________________________________________________________ Results Gender Male 155 Female 345 Age 15-20 150 21-30 155 31-40 100 41-50 95 Have you ever used the Thermasilk rage of hair products' Yes 423 No 77 Are you a Thermasilk user' Yes 97 No 403 To what extent does the product meet your needs' All 20 Not all 70 Average 80 Only a few 100 Not at all 230 If the product was changed would you be willing to switch from your current brand' Yes 355 No 145 Would you switch to another brand if it offered the same characteristics as this one' Yes 430 No 70 Read More