Zan Chen from Queen Mary, University of London
In the business world, to make a proper decision is related to success directly. Every manager is confronted with the same question which is how to complete this mission. Economists cannot figure out a solution to gain the 100% of correct rate in decision making, but they build a number of models and find many methods to increase the possibility. Brainstorming can help to develop potential alternatives. The motivation theory satisfies employees about their work and it leads to high efficiency. Besides both ideas above, market research can be a strong technique to solve the problem. During the process of decision making in a new plan, market research plays a vital role for any business or organization. This paper will discuss the effect of market research and give some suggestions to help managers make correct decisions. Firstly, it will give a definition of the subject. Then, the essay will discuss the function of market research in the detailed steps of decision making process. Finally, the challenges of market research in the future will be determined, followed by some suggestions on how to meet the challenges.
According to DJS Research Ltd, “Market Research is a systematic, objective collection and analysis of data about a particular target market, competition, and/or environment” (MarketResearchWorld.com). Some form of data collection which is done by desk research or primary research that is gathered from respondents directly is incorporated into it. The aim of market research is to get a better understanding of the working subject. As the competition of the world market becomes more and more fierce, market research is included in the organization no matter large or small.
Before the discussion of the role of market research in decision making, the process of decision making should be listed. David Boddy (2011), a professor of business and management from the University of Glasgow separated the decision making process into six steps: “recognizing a problem or opportunity, setting and weighting the decision criteria, developing alternatives, comparing alternatives and making a choice, implementing the choice and evaluating the decision” (p.197-200).
Market research has a positive effect on all of the steps and now some of them will be discussed. The first step, defining the problem, is the key of the whole process which affects all the following steps; if the opportunity is inaccurately defined, a wrong beginning point will mislead every step in the decision making process. More specifically, if the unsuccessful decision making leads the company to low profits or declining sales, the firm may have a problem with poor market research. The decreasing profits and sales are the symptoms of the problems. By identifying them separately from their symptoms, the real problem will be properly determined. According to research on shopping center marketing by Dr. Gentleman (2001), for example, a center with little competitors will possibly want to establish the maximum of additional geographic areas, in-mall habits and demographic segments. Another example is that a center with a new competitor will possibly analyze the habits of the residents in this area to develop the most effective strategy against the new competition.
Decision criteria influence the target and purpose of market research. Boddy (2011) stated in his book that “To decide between options people need decision criteria: the factors that are relevant to the decision” (p.198). The factors here can be information, time, personnel, equipment, supplies and any other limiting resources which market research can well define. For instance, in an opportunity of importing a new model of laptop, criteria may include the effect of design, price, compatibility with other systems, delivery, and warranty. After determining...