Chapter Two

Defining Research Problem and Hypothesis Formulation

In research process, the first and foremost step happens to be that of selecting and properly
defining a research problem. A researcher must find the problem and formulate it so that it
becomes susceptible to research. Like a medical doctor, a researcher must examine all the
symptoms (presented to him or observed by him) concerning a problem before he can diagnose
correctly. To define a problem correctly, a researcher must know: what a problem is?

2.1. What is a Research Problem?

A research problem, in general, refers to some difficulty which a researcher experiences in the
context of either a theoretical or practical situation and wants to obtain a solution for the same.
Usually we say that a research problem does exist if the following conditions are met with:
1) There must be an individual or a group which has some difficulty or the problem.
2) There must be some objective(s) to be attained at. If one wants nothing, one cannot have
a problem.
3) There must be alternative means (or the courses of action) for obtaining the objective(s)
one wishes to attain. This means that there must be at least two means available to a
researcher for if he has no choice of means, he cannot have a problem.
4) There must remain some doubt in the mind of a researcher with regard to the selection of
alternatives. This means that research must answer the question concerning the relative
efficiency of the possible alternatives.
5) There must be some environment(s) to which the difficulty pertains.
Thus, a research problem is one which requires a researcher to find out the best solution for the
given problem, i.e., to find out by which course of action the objective can be attained optimally
in the context of a given environment. There are several factors which may result in making the
problem complicated. For instance, the environment may change affecting the efficiencies of the
courses of action or the values of the outcomes; the number of alternative courses of action may
be very large; persons not involved in making the decision may be affected by it and react to it
favourably or unfavourably, and similar other factors. All such elements (or at least the important
ones) may be thought of in context of a research problem.

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Problem definition or problem statements ,as it is also often referred to, is a clear , precise ,and
succinct statement of the question or issue that is to be investigated with the goal of finding an
answer or solution. As mentioned earlier, problem definition could pertain to:

 Existing business problems where a manger looking for a solution,

 Situations that may not pose any current problems but which the manager feels have
scope for improvement ,
 Areas where some conceptual clarity is needed for better theory building, or
 Situations in which a researcher is trying to answer a research question empirically
because of interest in the topic.
 The first two fall within the realm of applied research, and the latter two under basic
research.

Defining the problem is critical to setting the direction for all subsequent phases of the research
process. This is particularly true for custom designed research, as opposed to standardized /
syndicated research.
 Standardized /syndicated research is generic research that is provided in identical
fashion to all buyers by the research supplier.
 Custom- designed research is research that is fashioned to address a unique
management problem confronting a client manager.
 Custom- designed research requires that the researcher fully understand the
circumstances of the manager‘s problem.
It is common for the manager and the researcher to define the problem. If the problem is not
defined correctly, satisfactory performance at the other stages in the research process will not
remedy the situation.
Broad problem areas that a manager could observe at the work place are as follows:
 Training programs are perhaps not as effective as anticipated.
 The sales volume of a product is not picking up.
 Minority group members in organisations are not advancing in their careers.
 The daily balancing of accounting ledgers is becoming a continuing concern.
 The anticipated results of a recent merger have not been forthcoming.
 Inventory control is not effective.

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The broad problem area would be narrowed down to specific issues for investigation after some
preliminary data are gathered by the researcher. This may be through interviews and literature
research.

Examples of Well-Defined Problems

 To what extent has the new advertising campaign been successful in creating the high-
quality, customer –centered corporate image that it was intended to produce?
 How has the new packaging affected the sales of the product?
 Is the effect of participative budgeting on performance moderated by control system?
 Does expansion of international operations result in an enhancement of the firm’s image
and value?
 What are the effects of downsizing on the long-Range growth patterns of companies?
Necessity of Defining the Problem
Quite often we all hear that a problem clearly stated is a problem half solved. This statement
signifies the need for defining a research problem. The problem to be investigated must be
defined unambiguously for that will help to discriminate relevant data from the irrelevant ones.
A proper definition of research problem will enable the researcher to be on the track whereas an
ill-defined problem may create hurdles. Questions like: What data are to be collected? What
characteristics of data are relevant and need to be studied? What relations are to be explored?
What techniques are to be used for the purpose? and similar other questions crop up in the mind
of the researcher who can well plan his strategy and find answers to all such questions only when
the research problem has been well defined. Thus, defining a research problem properly is a
prerequisite for any study and is a step of the highest importance. In fact, formulation of a
problem is often more essential than its solution. It is only on careful detailing the research
problem that we can work out the research design and can smoothly carry on all the
consequential steps involved while doing research.
Selecting the Problem
The research problem undertaken for study must be carefully selected. The task is a difficult one,
although it may not appear to be so. Help may be taken from a research guide in this connection.
Nevertheless, every researcher must find out his own salvation for research problems cannot be
borrowed. A problem must spring from the researcher’s mind like a plant springing from its own

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seed. If our eyes need glasses, it is not the optician alone who decides about the number of the
lens we require. We have to see ourselves and enable him to prescribe for us the right number by
cooperating with him. Thus, a research guide can at the most only help a researcher choose a
subject. However, the following points may be observed by a researcher in selecting a research
problem or a subject for research:
i. Subject which is overdone should not be normally chosen, for it will be a difficult task to
throw any new light in such a case.
ii. Controversial subject should not become the choice of an average researcher.
iii. Too narrow or too vague problems should be avoided.
iv. The subject selected for research should be familiar and feasible so that the related
research material or sources of research are within one’s reach. Even then it is quite
difficult to supply definitive ideas concerning how a researcher should obtain ideas for
his research.
v. The importance of the subject, the qualifications and the training of a researcher, the costs
involved, the time factor are few other criteria that must also be considered in selecting a
problem.
vi. The selection of a problem must be preceded by a preliminary study. This may not be
necessary when the problem requires the conduct of a research closely similar to one that
has already been done. But when the field of inquiry is relatively new and does not have
available a set of well-developed techniques, a brief feasibility study must always be
undertaken.
If the subject for research is selected properly by observing the above mentioned points, the
research will not be a boring drudgery, rather it will be love’s labour. In fact, zest for work is a
must. The subject or the problem selected must involve the researcher and must have an upper
most place in his mind so that he may undertake all pains needed for the study.
As a researcher, you need to know the answers to the following questions concerning the
research topic you are considering for investigation:
• Has the work already been done?
• Who are the experts in the field?
• What are the main theoretical perspectives?
• What are the common research methods in the topic?

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 • What are the main problems in researching the topic?
• Are there any major controversies in this topic area?
• Is the topic open to hypothesis testing?
• Is the topic a trivial one?
Assessment areas to define a research problem
There are eight assessment areas that help the researcher properly define the Management
problem.
1. Assess The Background of The Company , Product , And Market
2. Understand The Decision- Maker’s Circumstances , Objectives, And Resources
3. Clarify The Symptoms of The Problem
4. Pinpoint Suspected Causes of The Problem
5. Specify Actions That May Alleviate The Problem
6. Speculate On Anticipated Consequences of These Actions
7. Identify The Manager’s Assumptions About The Consequences ; And
8. Assess The Adequacy Of Information On Hand.
A Research Problem and Management Decision Problem
Management Decision Problem (MDP): MDP is the problem confronting the decision maker. It
asks what the decision maker needs to do.
A Research Problem: A problem that entails determining what information is needed and how
it can be obtained in the most feasible way.
Other illustrative examples between management decision problems and the research problems
include the following:

S/N Management Decision Problem Research Problem

1 Should a new product be To determine consumer preference s and purchases
introduced? intentions for the proposed new product?
2 Should the advertising campaign To determine the effectiveness of the current
be changed? advertising campaign?
3 Should the price of the brand be To determine the price elasticity of demand and the
increased? impact on sales and profits of various levels of price
changes.

2.2. The Process of Problem Definition

Identify and understanding the Background of the Problem

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The iceberg principle illustrates that understanding the background of a problem is vital. In
situations in which the decision maker's objectives are clear, the problem may be diagnosed
exclusively by exercising managerial judgment. In the absence of adequate information about a
problem a situation analysis is the logical first step in defining the problem. A situation analysis
involves a preliminary investigation or informal gathering of background information to
familiarize researchers or managers with the decision area. Gaining an awareness of
organizational or environmental conditions and an appreciation of the situation often requires
exploratory research.
Identify the problems and isolate the core problem from its symptoms
Anticipating all of the dimensions of a problem is impossible for any researcher or executive.
Occurrences that appear to be "the problem" may be only symptoms of a deeper problem.
Isolation of a core problem from its symptoms can be carried out by listing all the likely
problems and conducting cause and effect relationship of the identified problems through paired
comparison. This helps to eliminate the symptoms from the list
Determine the unit of analysis
Unit of analysis the level or unit about which conclusions are made in research. The investigation
may focus on the collection of data about organizations, departments, work groups, individuals
or objects. A problem may be investigated at more than one levels of analysis and the
conclusions may vary. Determining the unit of analysis should not be overlooked during the
problem definition stage of the research.
Determine the Relevant Variables
A variable is defined as anything that varies or changes in value. A variable generally is anything
that may assume different numerical or categorical values. Key independent and the dependent
variables should be identified in the problem definition stage. There are also extraneous variables
that influence the dependent variable. The assignment of variables to independent, extraneous,
and dependent variables vary from one situation to another.
State research questions (hypothesis) and objectives
Research questions and hypothesis can add clarity to the statement of the business problem.
Research questions makes it easier to understand what is perplexing to managers and
indicates the issues to be resolved. A research question is the researcher’s translation of the

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social/development problem into a specific need for inquiry. The goal of defining the problem is
to state the research questions clearly and to have well formulated hypothesis.
Research Questions: are refined statements of the specific components of the problem.
• Start thinking about your research early
• Totally open-ended research is risky
• Research questions help to focus your literature searches, data collection, analysis and
writing
• Make sure your research questions are: Clearly defined and researchable, theoretically
grounded, linked together, and neither too large nor too small.
Research Objective is the researcher's version of the business problem – specifies what is to be
done by the researcher. These objectives explain the purpose of the research in measurable
terms-and define standards of what the research should accomplish. Objectives help to
ensure that the project will be manageable in size. Research objectives must specify the
information needed to make a decision. It is useful if the research objective is a managerial
action standard. If the criterion to be measured
Articulating Hypotheses
Hypothesis: an unproven statement or proposition about a factor or phenomenon that is of
interest to the researcher. Hypotheses can be thought of as the researcher’s educated guess about
how the study will turn out. The hypotheses articulated in a particular study should logically
stem from the research problem being investigated. a hypothesis must make a prediction
(usually about the relationship between two or more variables)
Specific Research Questions:
RQ1: when do people eat comfort foods?
Ho: people eat comfort foods when they are in a good mood.
H1: people eat comfort foods when they are in a bad mood.
RQ2: How do people become attached to comfort foods?
Ho: People are attached to comfort foods that are consistent with their personality.
H1: People are attached to comfort foods because of past association.
A General Procedure for Hypothesis Testing
Null hypothesis is a statement in which no difference or effects are expected. If the null
hypothesis is not rejected, no changes will be made. The null hypothesis is a proposition that

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states a definitive, exact relationship between two variables. It states that the population
correlation between two variables is equal to zero or that the difference in the means of two
groups in the populations is equal to zero or the difference in the means of two groups in the
population is equal to zero( or some definite number). In general, the null statements are
expressed as no (significant) relationship between two variables or no (significant) difference
between two groups.
Alternative Hypothesis: is a statement that some difference or effect is expected. Accepting the
alternative hypothesis will lead to changes in opinions or actions.
Directional and Non –Directional Hypothesis
Directional Hypothesis (DP)
DH is refers to those hypothesis that deals with relationships between two variables or
comparing two groups. In stating such hypothesis terms such as positive, negative, more than,
less than, and the like are used.
Non Directional Hypothesis (NDH)
NDH are those that do no postulate a relationship or difference, but offer no indication of the
direction of these relationships or differences. In other words, though it may be conjectured that
there would be a significant relationship between two variables, we may not be able to say the
relationship would be positive or negative.
Parametric tests: hypothesis –testing procedures that assume that the variables of interest are
measured on at least an interval scale.
Nonparametric test: hypothesis testing procedures that assume that the variables are measured
on a nominal or ordinal scale.
The following steps are involved in hypothesis testing:
 Formulate the null hypothesis H0 and the alternative hypothesis HA.
 Select an appropriate statistical technique and the corresponding test statistic.
 Choose the level of sigiinificance, α.
 Determine the sample size and collect the data .Calculate the value of the test statistics.
 Determine the probability associated with the test statistics under the null hypothesis using
the sampling distribution of the test statistics. Alternatively, determine the critical values
associated with the test statistics that divide the rejection and non rejection regions.

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  Compare the probability associated with the test statistics with the level of significance
specified. Alternatively, determine whether the test statistics has fallen into the rejection or
the non-rejection region.
 Make the statistical decision to reject or not to reject the null hypothesis.
 Express the statistical decision in terms of the research problem.
Testable Statements
 If employees are more healthy, then they will take sick leave less frequently.(DH)
 The greater the stress experienced in the job, the lower the job satisfaction of
employees.(DH)
 There is a relationship between age and job satisfaction.(NDH)
 There is a difference between the work ethic values of American and Asian
employees.(NDH)
 Male managers have more access to critical information than women managers in the same
ranks.(DH)
 Sex-role stereotyping and access to critical information will both significantly explain the
variance in promotional opportunities for women to top-level positions.(NDH)
Schematic diagram of 6-10
Sex-role stereotyping

Advancement of women
to the top.

Access to information
Dependent Variable

Independent variables