Page 296 - Business Principles and Management

Chapter 11 • Management Functions and Decision Making

managers want to evaluate performance, they can
quickly access data from the management informa-
tion system related to that performance. The data
can be used to compare performance to previously
established standards or to the performance of a
similar group or a previous time period.

BUSINESS RESEARCH
Managers must be careful not to make decisions with-
out sufficient information about the problem or pos-
sible solutions. When they need more information to
make a good decision, they may need to conduct re-
search. Research is conducted to gather new informa-
tion not yet included in the management information PHOTO: © CORBIS.
system. The results of business research can be added
to the management information system and then used
for future decisions.
Business research is conducted in many areas.
Wherever and whenever managers need information
to make decisions and the needed information is not available, business research Managers have much more
should be considered. information available today
Marketing research and product development research are two common areas. than ever before. How can
A marketing manager may want to determine why certain groups of customers too much information actu-
are purchasing a product whereas others are not. A proposed new product should ally decrease a manager’s
not be developed unless research shows that the product can be produced at a effectiveness?
profit and that customers are likely to purchase it.
Human resources studies are conducted on such topics as the supply and
demand of labor, employee motivation, and training techniques. Financial
executives need the results of research that deals with borrowing and invest-
ing money. Those managers also need research results regarding economic
factors, such as the expected economic performance of specific companies or
of the industry in which a company operates. The research described as well
as other types of research helps executives make important decisions relative
to the growth and development of their companies.
Much of the needed business research is done by the business itself. Most large
companies have research departments that plan and complete studies related to
the specific problems of the company. But because research departments are ex-
pensive to maintain, small companies must depend to a considerable degree
on professional research organizations.
Research centers and faculty members in universities conduct studies that
are often helpful to businesses. Various divisions of the federal government
undertake extensive research, and much of this information is available to
and useful for business. Trade and professional associations conduct research
studies that are useful to the particular industries they serve. Companies may
also employ research organizations or individual consultants to gather and an-
alyze information to solve problems or improve decision making.

CHECKPOINT
In addition to conducting their own research, what other sources
of business research are available to companies?

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