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Library of Congress Cataloging-in-Publication Data on File 10 9 8 7 6 5 4 3 2 1

ISBN 13: 978-1-323-60762-6

13 Finding, Evaluating, and Processing Information LEARNING OBJECTIVES

After studying this chapter, you will be able to

1 (http://content.thuzelearning.com/books/Bovee.7626.18.1/sections/p7001012451000000000000000004d51#P7001012451000000000000000004D57)

Describe an effective process for conducting business research.

2 (http://content.thuzelearning.com/books/Bovee.7626.18.1/sections/p7001012451000000000000000004da9#P7001012451000000000000000004DAF)

Define secondary research, and explain how to evaluate, locate, and document information sources.

3 (http://content.thuzelearning.com/books/Bovee.7626.18.1/sections/p7001012451000000000000000004e9b#P7001012451000000000000000004EA1)

Define primary research, and outline the steps involved in conducting surveys and interviews.

4 (http://content.thuzelearning.com/books/Bovee.7626.18.1/sections/p7001012451000000000000000004f0b#P7001012451000000000000000004F11) Describe the major tasks involved in processing research results.

5 (http://content.thuzelearning.com/books/Bovee.7626.18.1/sections/p7001012451000000000000000004f5c#P7001012451000000000000000004F60) Explain how to summarize research results and present conclusions and recommendations.

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COMMUNICATION CLOSE-UP AT Strategyzer

strategyzer.com (http://strategyzer.com)

Whenever you’re gathering information for a major business writing project, you’re likely to encounter the question of how much is enough? Collecting and processing information takes time and often costs money, and it’s not always clear how much information you need in order to craft an effective report or proposal, or how much time and money you should invest to get it. Invest too little and you risk writing a flawed report. Invest too much and you’ll waste time and money that would be better put to other uses.

Business plans are a great example of this dilemma, and they have a special twist that makes information collection even more challenging. As you’ll read on page 396 (http://content.thuzelearning.com/books/Bovee.7626.18.1/sections/p70010124510000000000000000052bb#page_396) in Chapter 14 (http://content.thuzelearning.com/books/Bovee.7626.18.1/sections/p7001012451000000000000000005122#P7001012451000000000000000005122) , conventional business plan covers a lot of territory, from a high-level look at strategy to details on financing, operations, marketing, and other functional areas. These reports can run to 20, 30, 40 pages or more, and you can spend weeks gathering the necessary information and distilling it down to useful formats.

Author and entrepreneur Alex Osterwalder’s approach to evaluating new business ideas offers a simpler, faster alternative than the traditional business plan.

Courtesy of Alex Osterwalder

Spending that much time on research before writing the business plan and launching the company can seem like a good idea to entrepreneurs who want to reduce start-up risks as much as possible or who want to produce high-quality reports to impress lenders or investors. In many start-up situations, however, this is precious time that entrepreneurs should be spending getting a product in front of customers to test the viability of the business concept, rather than crafting an impressive-looking plan about an idea that is still unproven. Moreover, in fast-moving markets, it is possible to spend so much time researching and writing the business plan that the target market changes by the time the plan is ready.

The special twist with business plans involves the uncertainty surrounding some of the most important information they typically contain. For example, estimating demand for a new product or service is one of the most vital aspects of planning a business—and one of the most difficult. You might spend weeks or months gathering data on comparable products and refining spreadsheets with elegant forecasting models to predict how many products you can sell and how much profit you’ll make. This projection will then be the basis of almost everything else in the business plan, from the amount of money you can attract from investors to the number of employees you should hire.

Here’s the catch: You could spend all this time writing a plan and launching a business based on this number only to find out it’s wildly off the mark. In the worst case scenario, you might’ve wasted months launching a weak business idea or a product with little or no market appeal. Even the most sophisticated estimates of market demand are still only predictions, and the only way to really know if a product is going to sell is to get it in front of customers and ask them to buy it.

In response to these uncertainties with conventional business plans, some experts now recommend a simplified, accelerated approach that gets a new business to the “point of proof” faster. One of the key thinkers behind this new approach is the Swiss author and entrepreneur Alex Osterwalder. Rather than launching businesses with elaborate planning and a conventional business plan, he proposes that companies use the Business Model Canvas. This single- sheet visual brainstorming tool helps entrepreneurs answer a handful of key questions to determine whether they have a financially viable business concept—and what to adjust if they don’t. The canvas approach helps flag some of the common stumbling points of new businesses, including financial plans that are based on shaky assumptions (or outright fantasy) and untested hypotheses about market behavior.

The Business Model Canvas and its variants don’t necessarily replace conventional business reports in all cases, and they don’t cover all the details needed to operate a business after launch, but they help entrepreneurs decide whether it makes sense to move forward. By developing and testing business concepts quickly, entrepreneurs can find out whether they have a realistic idea before investing weeks of time in detailed planning and report-writing efforts. The canvas idea has definitely captured the imagination of entrepreneurs: More than a million people bought the book that first outlined the canvas

idea, and more than 5 million have downloaded the Business Model Canvas.1

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13.1 Planning Your Research

LEARNING OBJECTIVE

1 Describe an effective process for conducting business research.

Audiences expect you to support your business messages with solid research.

Whether you’re brainstorming a new business idea using something like Strategyzer’s Business Model Canvas (profiled in the chapter-opening Communication Close-Up) or planning a conventional business report or proposal, you need to make sure your reporting, analysis, and recommendations are supported with solid research. Figure 13.1 (http://content.thuzelearning.com/books/Bovee.7626.18.1/sections/p7001012451000000000000000004d51#P7001012451000000000000000004D5B) outlines a five-step research process that will help you gather and use information efficiently; you’ll learn more about these steps in the following sections.

With so much information now online, it’s tempting just to punch some keywords into a search engine and grab the first few results that show up. However, effective and efficient research requires a more thoughtful approach. Your favorite search engine might not be able to reach the webpages that have the information you need, the information might not be online at all, it might be online but not under the search terms you’ve used, or it might not even exist in any form.

Figure 13.1 The Research Process

By following a methodical research process, you can save time and money while uncovering better information.

Researching without a plan can waste time and produce flawed results.

To maximize your chances of finding useful information and to minimize the time you spend looking for it, follow these planning steps: Familiarize yourself with the subject so that you can frame insightful questions, identify the most critical gaps in your information, and then prioritize your research needs. However, before launching any research project, be sure to take a moment or two to consider the ethics and etiquette of your approach.

MAINTAINING ETHICS AND ETIQUETTE IN YOUR RESEARCH

Your research tactics affect the people you gather data and information from and the people who read and apply your results. To avoid ethical lapses, keep the following points in mind:

Take precautions to avoid ethical lapses in your research.

• Don’t force a specific outcome by skewing your research. Approach your research with an open mind and a willingness to accept whatever you find, even if it’s not what you expect or want to see.

Privacy is a contentious issue in the research field today.

• Respect the privacy of your research participants. Privacy is a contentious issue today. Businesses believe they have a right to protect their confidential information from competitors, and consumers believe they have a right to protect their personal information from businesses.

• Document sources and give appropriate credit. Whether you are using published documents, personal interviews, or company records, citing your sources not only is fair to the people who created and provided the information but also helps your audience members confirm your information or explore it in more detail, if they so choose.

Don’t automatically assume that you can use all the ideas and information you find online.

• Respect the intellectual property and digital rights of your sources. For example, your research might turn up a great new way to sell services online, but that doesn’t mean you’re free to implement that process. It might be protected by one of the many patents that have been granted in recent years for business process models.

• Don’t extract more from your sources than they actually provide. In other words, don’t succumb to the temptation to put words in a source’s mouth. For instance, if an industry expert says that a sales increase is possible, don’t quote him or her as saying that a sales increase is probable.

• Don’t misrepresent who you are or what you intend to do with the research results. One classic example of ethical lapses in this area is known as sugging, short for selling under the guise of research. For example, a firm might seem to be conducting a survey when it is, in fact, using the questions to identify hot sales leads. Another unethical variation on sugging is following up a real survey with sales calls, using information that

respondents shared in the belief that they were only participating in a survey.2

(http://content.thuzelearning.com/books/Bovee.7626.18.1/sections/p7001012451000000000000000004fa4#P7001012451000000000000000005109)

Research etiquette deserves careful attention, too. For example, respect the time of anyone who agrees to be interviewed or to be a research participant, and maintain courtesy throughout the interview or research process. For more information on research ethics and etiquette, review the Code of Standards and Ethics for Survey Research published by the Council of America Survey Research Organizations (www.casro.org (http://www.casro.org) ).

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FAMILIARIZING YOURSELF WITH THE SUBJECT

Avoid false starts and blind alleys by familiarizing yourself with new subject areas before you start your research.

Give yourself some unstructured time at the beginning of the project to explore the general subject area, perhaps by reading industry publications and blogs, searching for trending topics on Twitter, visiting competitors’ websites, and interviewing experts within your organization. Scanning the tables of contents and indexes of books on the subject can give you a sense of how a broad subject area is divided into component topics.

The problem statement defines the purpose of your research and guides your investigation.

When you have a basic grasp of the subject area, develop a problem statement (http://content.thuzelearning.com/books/Bovee.7626.18.1/sections/p7001012451000000000000000004fa4#P7001012451000000000000000004FD1) that defines the problem or purpose of your research—the decision you need to make or the conclusion you need to reach at the end of the process. You may find it easier to phrase the problem as a question, such as “How can we improve customer satisfaction?” or “Does Apple’s new TV system pose a competitive threat to us?”

IDENTIFYING INFORMATION GAPS

Focus your research by identifying the most important gaps in your information.

Your problem statement frames the purpose of your research, but it doesn’t usually tell you what specific information you need to find. Your next task is to dig deeper to discover the information gaps that need to be filled through research. You or someone in your company may already have some of the information you need, and you don’t want to waste time or money gathering information you already have.

For instance, the question “How can we improve customer satisfaction?” is too vague because many separate factors contribute to customer satisfaction. To get useful information, you would break this topic down into specific issues, such as product reliability and customer service skills. Digging further, you may discover that you don’t need to research product reliability because the company already tracks data on product repairs. However, if no one has ever measured the employees’ customer service skills, you would identify that as a definite information gap.

PRIORITIZING RESEARCH NEEDS

You usually won’t have enough time or money to answer every question that comes to mind, so setting priorities is a must.

Prioritizing your research needs is important because you won’t have the time or money to answer every question you might have. Moreover, if you’ll be using interviews or surveys, you’ll need to limit the number of questions you ask so that you don’t consume more time than people are willing to give. One simple way to prioritize is to divide your questions into “need to know” and “nice to know” and then toss out all the “nice to know” questions. If you start with a technique such as information gap analysis, you will get a clear idea of the information you truly need to collect.

13.2 Conducting Secondary Research

LEARNING OBJECTIVE

2 Define secondary research, and explain how to evaluate, locate, and document information sources.

Secondary research efforts gather and analyze information that has been previously collected for other purposes.

With a clear plan and careful prioritization, you’re ready to conduct research, and the first step is to see whether anyone else has already done some or all of the research you need. Consulting research that was done previously for another purpose is considered secondary research (http://content.thuzelearning.com/books/Bovee.7626.18.1/sections/p7001012451000000000000000004fa4#P7001012451000000000000000004FDA) . The sources for such information include print and online periodicals, online databases, books, and other research reports. (Some companies specialize in reports on particular industries, companies, technologies, market regions, and other subjects.)

Start your research by conducting secondary research first.

Don’t let the name secondary mislead you, though. You want to start with secondary research because it can save you considerable time and money, although you may have to pay to see someone else’s results. In contrast, primary research (see page 372 (http://content.thuzelearning.com/books/Bovee.7626.18.1/sections/p7001012451000000000000000004da9#page_372) ) is new research done specifically for the current project.

EVALUATING SOURCES

Evaluate your sources carefully to avoid embarrassing and potentially damaging mistakes.

No matter where you’re searching, it is your responsibility to separate quality information from unreliable or misleading junk to avoid corrupting your results. Social media have complicated this challenge by making many new sources of information available. On the positive side, independent sources communicating through blogs, wikis, Twitter, user-generated content sites, and podcasting channels can provide valuable and unique insights, often from experts whose voices might never be heard otherwise. On the negative side, these nontraditional information sources often lack the editorial boards and fact-checkers commonly used in traditional publishing. You cannot assume that the information you find is accurate, objective, and current. Answer the following questions about each piece of material:

• Does the source have a reputation for honesty and reliability? Naturally, you’ll feel more comfortable using information from an established source that has a reputation for accuracy. But don’t let your guard down completely; even the finest reporters and editors can make mistakes. For sources that are new or relatively unknown, your safest bet is to corroborate anything you learn with information from several other sources.

• Is the source potentially biased? The individual or organization providing the information might have a particular bias or point of view regarding the information and its context. Such bias is neither inherently bad nor unethical (unless it is being intentionally hidden), but you need to be aware of it to interpret the information you find.

• What is the purpose of the material? Was the material designed to inform others of new research, advance a position, or stimulate discussion? Was it designed to promote or sell a product? Be sure to distinguish among advertising, advocating, and informing.

• Is the author credible? Find out whether the person or the publisher is known and respected in the field. Is the author someone with hands-on experience in the subject area or merely an observer with an opinion?

• Where did the source get its information? Many sources of secondary information get their material from other secondary sources, removing you even further from the original data.

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The Instapaper mobile app lets you instantly save webpages and articles to read later, a convenient capability when you’re exploring a topic and want to collect potential sources for review.

Let your readers know if you were unable to verify critical pieces of information obtained in your research.

• Can you verify the material independently? Verification can uncover biases or mistakes—which is particularly important when the information goes beyond simple facts to include projections, interpretations, and estimates. If you can’t verify critical information, let your audience know that.

• Is the material current? Make sure you are using the most current information available by checking the publication or posting date. • Is the material complete? Have you accessed the entire document or only a selection from it? If it’s a selection, which parts were excluded? Do

you need more detail?

• Are all claims supported with evidence? Are opinions presented as facts? Does the writer make broad claims, such as “most people believe . . .,” without citing any surveys to prove his or her point?

• Do the source’s claims stand up to logical scrutiny? Finally, step back and ask whether the information makes sense. If that little voice in your head says that something sounds suspicious, listen!

You probably won’t have time to conduct a thorough background check on all your sources, so focus your efforts on the most important or most suspicious pieces of information.

LOCATING SOURCES

Even if you intend to eventually conduct primary research, start with a review of any available secondary research. Inside your company, you might be able to find a variety of documents prepared for other projects that offer helpful information. Be sure to ask whether your company has a knowledge management system or some other repository for research results. (See “Managing Information (http://content.thuzelearning.com/books/Bovee.7626.18.1/sections/p7001012451000000000000000004f5c#P7001012451000000000000000004F8A) ” on page 379 (http://content.thuzelearning.com/books/Bovee.7626.18.1/sections/p7001012451000000000000000004f5c#page_379) for more on this topic.) Outside the company, you can choose from a wide range of print and online resources, some of which are included in Table 13.1 (http://content.thuzelearning.com/books/Bovee.7626.18.1/sections/p7001012451000000000000000004da9#P7001012451000000000000000004DD9) on the next

page.3 (http://content.thuzelearning.com/books/Bovee.7626.18.1/sections/p7001012451000000000000000004fa4#P700101245100000000000000000510B) (The list in this table represents a tiny fraction of the secondary resources available; ask a reference librarian for advice on researching specific business topics.) For instance, if you want to know more about a specific company, one of the first things you’ll need to find out is whether the company is public (sells shares of stock to the general public) or private. Public corporations, which are required to submit extensive financial reports to government agencies, usually have more information available than private companies.

Finding Information at the Library

Public, corporate, and university libraries offer an enormous array of business books, databases, newspapers, periodicals, directories, almanacs, and government publications. Some of these printed sources provide information that is not available online, and some of the online sources provide information that is available by subscription. Don’t assume that you can find everything you need through your own online research.

TABLE 13.1 Important Resources for Business Research* (http://content.thuzelearning.com/books/Bovee.7626.18.1/sections/p7001012451000000000000000004da9#P7001012451000000000000000004E07)

COMPANY, INDUSTRY, AND PRODUCT RESOURCES

AnnualReports.com (http://AnnualReports.com) . Free access to annual reports from thousands of public companies.

Brands and Their Companies/Companies and Their Brands. Contains data on several hundred thousand consumer products, manufacturers, importers, marketers, and distributors. Available as an online database; ask at your library.

D&B Directories. Dun & Bradstreet publishes a variety of business databases and directories covering thousands of companies worldwide.

Hoover’s Online. Database of millions of companies, including in-depth coverage of thousands of leading companies around the world. Basic information is available free; in-depth information requires a subscription.

Manufacturing & Distribution USA. Data on thousands of companies in the manufacturing, wholesaling, and retailing sectors.

NAICS Codes. North American Industry Classification System.

Reference USA. Concise information on millions of U.S. companies; subscription database.

SEC filings. U.S. Securities and Exchange Commission filings, including 10Ks, 10Qs, annual reports, and prospectuses, for U.S. public firms.

Standard & Poor’s Net Advantage. Comprehensive range of directories and databases focusing on publicly traded companies and their industries and markets.

ThomasNet. Information on thousands of U.S. manufacturers, indexed by company name and product.

RESEARCH DIRECTORIES AND INDEXES

Books in Print. Database indexes millions of books, audiobooks, and video titles from around the world. Available in print and professional online versions.

Directories in Print. Information on thousands of business and industrial directories.

Encyclopedia of Associations. Index of thousands of associations, listed by broad subject category, specific subject, association, and location. Available as an online database as well.

Reader’s Guide to Periodical Literature. Database of articles in general-interest magazines.

TRADEMARKS AND PATENTS

Official Gazette of the United States Patent and Trademark Office. Weekly publications (one for trademarks and one for patents) providing official record of newly assigned trademarks and patents, product descriptions, and product names.

United States Patent and Trademark Office. Trademark and patent information records.

STATISTICS AND OTHER BUSINESS DATA

COMPANY, INDUSTRY, AND PRODUCT RESOURCES

U.S. Bureau of Economic Analysis. Large collection of economic and government data.

Europa—The European Union Online. A portal that provides up-to-date coverage of current affairs, legislation, policies, and EU statistics.

FedStats. Access to a full range of statistics and information from more than 70 U.S. government agencies.

Key Business Ratios (Dun & Bradstreet). Industry, financial, and performance ratios.

Information Please Almanac. Compilation of broad-range statistical data, with a strong focus on the labor force.

Annual Statement Studies. Industry, financial, and performance ratios published by the Risk Management Association.

Statistical Abstract of the United States. Annual compendium of U.S. economic, social, political, and industrial statistics.

The World Almanac and Book of Facts. Facts on economic, social, educational, and political events for major countries.

U.S. Bureau of Labor Statistics. Extensive national and regional information on labor and business, including employment, industry growth, productivity, the Consumer Price Index, and the overall U.S. economy.

U.S. Census Bureau. Demographic data and analysis on consumers and businesses based on census results.

COMMERCIAL DATABASES

A wide variety of commercial databases provide access to articles from trade and academic journals; ask your reference librarian to help you select the best databases for specific research projects.

* (http://content.thuzelearning.com/books/Bovee.7626.18.1/sections/p7001012451000000000000000004da9#rP7001012451000000000000000004E07) Note: Some of these resources are free, and some are available via subscription only; check with your librarian.

Libraries offer information and resources you can’t find anywhere else—including reference librarians who can show you how to plan and conduct effective searches.

Libraries are also where you’ll find one of your most important resources: librarians. Reference librarians are skilled in research strategies and can often help you locate obscure information you can’t find on your own. They can also direct you to many sources of business information. Also, many library websites now have a business portal, with links to helpful resources and advice on finding information.

Whether you’re looking for information in printed materials or in databases, each type of resource serves a special function:

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Wondering how to get started with business research?

Baruch College’s Beginner’s Guide to Business Research will point you in the right direction. Go to real-timeupdates.com/bct14 (http://real- timeupdates.com/bct14) and select Learn More in the Students section.

• Newspapers and periodicals. Libraries offer access to a wide variety of popular magazines, general business magazines, trade journals (which provide information about specific professions and industries), and academic journals (which provide research-oriented articles from researchers and educators). Check the library’s website or ask a librarian to find out which periodicals are available in print or digital formats.

• Business books. Although generally less timely than newspapers, periodicals, and online sources, business books provide in-depth coverage of a variety of business topics. Many libraries now offer online access to their card catalogs so you can see whether they have specific titles in their collections.

• Directories. Thousands of directories are published in print and digital formats in the United States, and many include membership information for all kinds of professions, industries, and special-interest groups.

• Almanacs and statistical resources. Almanacs are handy guides to factual and statistical information about countries, politics, the labor force, and so on. One of the most extensive, the Statistical Abstract of the United States, published annually by the U.S. Department of Commerce, contains statistics about occupations, government, population, health, business, crime, and the environment (also available online at www.census.gov (http://www.census.gov) ).