Business Research for Decision Making Sixth Edition by Duane Davis Chapter 7 Foundations of Measurement

1. PowerPoint Slides for the Instructor’s Resource Manual for Business Research for Decision MakingSixth EditionbyDuane DavisChapter 7Foundations of Measurement

2. Foundations of Measurement concerned with the assignment of numbers to empirical rules according to a set of rules goal is to translate characteristics and properties of empirical events into a form that can be analyzed. • Observable empirical events • Use of numbers to represent these events • A set of mapping rules Measurement: Necessary Components:

3. Example of the Relationships Among the Three Components of Measurement Figure 7.1

4. The Measurement Process Figure 7.2

6. Levels of Measurement • Nominal • Ordinal • Interval • Ratio

7. Nominal • Lowest level of measurement • Numbers assigned to categories but the numbers have no meaning • 1= male; 2= female • 1= sophomore; 2 = junior; 3= senior • Loss of information if other scales converted to nominal

8. Ordinal • Rank order on some characteristic or property • Intelligence, aptitude, and personality test scores are generally ordinal • E.g. not amount of intelligence, but rank order of intelligence • No absolute zeros and the intervals are not equal.

9. Ordinal Example • What is your age? • 1 = under 18 • 2 = 18-22 • 3 = 22-30 • 4 = 30-40 • 5 = over 40

10. Ordinal Example • Overall, I am satisfied with myself • 1) strongly disagree • 2) disagree • 3) neutral • 4) agree • 5) strongly agree

11. Interval • One unit on the scale represents the same magnitude on the trait or characteristic being measured across the whole range of the scale. • For example, if anxiety were measured on an interval scale, then a difference between a score of 10 and a score of 11 would represent the same difference in anxiety as would a difference between a score of 50 and a score of 51. • Rare to non-existent in behavioral research

12. Ratio • Have a true zero, so distance between points has meaning • Incorporate the properties of all other scales • What is your age?

13. Three Basic Types of Validity in Measurement Table 7.2

14. A B a b Construct Measure Predictive validity Concurrent validity

15. Reliability • Refers to the consistency and stability of a measurement scale. Generally use a coefficient of reliability to assess the reliability of a measure. Can range from 0 to 1.0, with 1.0 perfect reliability. • Guidelines for Minimum Reliabilities: 0.7 for exploratory research 0.8 for basic research 0.9 or better in applied settings where important decisions will be made from scales

16. Methods for Reliability Assessment 1. Test-Retest Method 2.Alternative Forms 3.Internal Consistency - Split-half - Cronbach-Alpha/KR-20

17. Illustrations of Possible Reliability/Validity Situations in Measurement Figure 7.3

18. Improving reliability • Write items that are unambiguous • Add more items of equal kind and quality • General rule of thumb is at least 3-4 items for any scale • Make the instructions clear and standard

19. Managerial Considerations(Why get involved?) • Bad measurement, no value to managers • Scaling sets limits on analysis • Global and international research compounds problems • Measurement issues are early in the business research process – compounds problems

20. Managerial Strategies for Ensuring Good Measurement • Require clearly defined constitutive concepts • Require operational definitions • Require multi-item scales when possible • Require validity, reliability and pretest assessments when possible • Require analytical foresight

21. Key Managerial Questions Pertaining to the Measurement Process Exhibit 7.2