Exhibit 3-2 Management-Research Question Hierarchy Management Decision What is the recommended course of action, glven the research Insights? Measurement Questions What should be asked or observed to obtaln the Information the manager needs? Investigative Questions What does the manager need to know to choose the best alternative from the avallable courses of action? Research Question(s) What plausible courses of action are avallable to management to correct the problem or take advantage of the opportunity, and which should be considered? Management Question How can management ellminate the negative symptoms? How can management fully capltalize on an opportunity? Management What symptoms cause management concern? What Dilemma envronmental stimull ralse management interest? Exhibit 3-3 SalePro’s Management-Research Question Hierarchy Declining sales is one of the most common symptoms serving as a stimulus for a research project, especially a continuing pattern that is unexplained. SalePro, a large manufacturer of industrial goods, faces this situation. Exploration (1) reveals that sales, in fact, should not be declining in the South and Northeast. Environmental factors there are as favorable as in the growing regions. Subsequent exploration (2, 3) leads management to believe that the problem is in one of three areas salesperson compensation, product formulation, or trade advertising. Further exploration (4) has SalePro management narrowing the focus of its research to alternative ways to alter the sales compensation system, which (5) leads to a survey of all sales personnel in the affected regions. Why are our sales declining in the South and Northeast, while sales are booming in the Southwest? How can we improve sales in the South and Northeast? Should we introduce a 2 percent incentive commission-based compensation system on all sales over quota for salespeople in the South and Northeast or a 5-percent-of-profit regional bonus to the region that increases sales by 10 percent over quota (to be shared proportionately among the salespeople in the region)? Should we modify the product formula for distribution in the South and Northeast? Should we increase the level of advertising via trade publications in South and Northeast editions? What is the likelihood that we will lose excellent salespeople in the South and Northeast if we implement the compensation change? What is the likelihood that current customer satisfaction in these regions will decrease? What is the likelihood that future sales to existing customers will be lost? Please rate your level of concern for each of the following outcomes if management were to change your compensation to a commission-based system compared to the current salary system. For each outcome, indicate a number between 1 and 7 where 7 extreme concern 4-neither concerned nor unconcerned, and 1 no concern at all Lack of predictability of monthly pay Increased internal competition for sales prospects. Reduced time for postsale servicing of customer needs. Reduced incentive for postsale servicing of customer needs.
The Correct Answer and Explanation is :
The Management-Research Question Hierarchy is a structured framework that guides researchers from identifying a management dilemma to formulating specific research questions. This hierarchy ensures that research efforts are aligned with managerial needs and objectives.
1. Management Dilemma:
This is the initial problem or opportunity that prompts the need for research. It represents a situation causing concern or interest for management.
2. Management Question:
Restates the management dilemma in question form, focusing on what management needs to know to address the dilemma.
3. Research Question(s):
Explores the various options available to management to resolve the dilemma, aiming to identify the most effective course of action.
4. Investigative Questions:
Breaks down the research questions into specific areas that need to be investigated to answer the research questions comprehensively.
5. Measurement Questions:
Defines what should be asked or observed to obtain the necessary information for the investigative questions.
6. Management Decision:
Based on the insights gained from the research, this is the recommended course of action for management.
Application to SalePro’s Case:
SalePro, a large manufacturer of industrial goods, is experiencing declining sales in the South and Northeast regions, despite favorable environmental factors. This situation serves as the management dilemma.
- Management Question: How can we improve sales in the South and Northeast?
- Research Question(s):
- What plausible courses of action are available to management to correct the problem or take advantage of the opportunity, and which should be considered?
- Should we introduce a 2% incentive commission-based compensation system on all sales over quota for salespeople in the South and Northeast or a 5% of profit regional bonus to the region that increases sales by 10% over quota?
- Should we modify the product formula for distribution in the South and Northeast?
- Should we increase the level of advertising via trade publications in South and Northeast editions?
- Investigative Questions:
- What is the likelihood that we will lose excellent salespeople in the South and Northeast if we implement the compensation change?
- What is the likelihood that current customer satisfaction in these regions will decrease?
- What is the likelihood that future sales to existing customers will be lost?
- Measurement Questions:
- Please rate your level of concern for each of the following outcomes if management were to change your compensation to a commission-based system compared to the current salary system. For each outcome, indicate a number between 1 and 7 where 7 = extreme concern, 4 = neither concerned nor unconcerned, and 1 = no concern at all:
- Lack of predictability of monthly pay
- Increased internal competition for sales prospects
- Reduced time for post-sale servicing of customer needs
- Reduced incentive for post-sale servicing of customer needs
By systematically addressing each level of the hierarchy, SalePro can develop a targeted research approach to identify the most effective strategies for improving sales in the South and Northeast regions. This structured methodology ensures that all aspects of the problem are thoroughly examined, leading to well-informed management decisions.