Chapter 3 Methods and Procedure
3.1 Chapter Overview
This chapter shall discuss the research methods available for the study and what is applicable for it to use. Likewise, the chapter shall present how the research will be implemented and how to come up with pertinent findings.
Moreover, this methodology part of the research underwent into several stages. In the research design, the researcher collected secondary data i.e. from financial ratios of Hong Kong Banks found in and formulated and developed the interview. In this stage, these instruments were subjected to approval and validation. During the data collection, the researcher collated and summarized the data obtained from these sources. The researcher then analyzed these data and from these, the researcher came up with findings and recommendations that shall be presented in the next chapters.
3.2 Method of Research Used
This study will be utilising the descriptive type of methodology. In this method, the possibility of making the study cheap and quick becomes apparent. Aside from this, it could also suggest unanticipated hypotheses. Nevertheless, it would be very hard to rule out alternative explanations and especially infer causations. To illustrate the descriptive type of research, (1994) guided the researcher when he stated: “Descriptive method of research is to gather information about the present existing condition.”
The purpose of employing this method is to describe the nature of a situation, as it exists at the time of the study and to explore the cause/s of particular phenomena. The researcher opted to use this kind of research considering the desire of the researcher to obtain first hand data from the respondents so as to formulate rational and sound conclusions and recommendations for the study. To come up with pertinent findings and to provide credible recommendations, this study utilized two sources of research: primary and secondary. Primary research data were obtained through this new research study. Interviews were conducted. Basically, for this research design, the researcher will gather data, collate published studies from different local and foreign universities and articles from business journals; financial ratios from www.ft.com and make an evaluation of the collected documentary and verbal material. Afterwards, the researcher will summaries all the information, make a conclusion based on the hypotheses posited and provide insightful recommendations on the dealing with the current status of banking businesses in Hong Kong in response to Financial Tsunami of 2008.
3.3 Data Collection
Data shall be collected from multiple sources, allowing for a number of different perspectives to be taken into consideration in the development of the recommendations.
The data sources that will be examined include:
· a review of the appropriate research literature. This include examining recent studies related to Hong Kong Bank industry, Asian financial crisis and current financial tsunami of 2008;
- responses of the respondents in the interview. The interview shall focus on the nature of the financial standing of the bank.
· And profitability ratio, liquidity ratio, efficiency ratio, and ROCE of five major banks such as Hong Kong and Shanghai Banking Corporation (HSBC), Standard Chartered Bank (Hong Kong), Citibank (Hong Kong), Hang Seng Bank and Bank of China from
3.3.1 Sample and Sampling Technique
The respondents of the study came from the individuals in five major banks such as Hong Kong and Shanghai Banking Corporation (HSBC), Standard Chartered Bank (Hong Kong), Citibank (Hong Kong), Hang Seng Bank and Bank of China. These subjects are comprises of managers of the selected banks. Due to time constraint and also, for the convenience of the researcher, only ten (10) respondents were considered for the study since the whole population is not available. Two mangers in each bank were selected. Basically, the use of formula was imposed in the study to pick up the ten respondents, mainly because the availability of the respondents was considered.
This part of the study is important because the most important data needed to fulfill the objectives of this study will only be supplied by the respondents from the individuals that are involved in these banks.
3.3.2 Respondents of the Study The general population for this study is composed 10 individuals from different Bank business in Hong Kong which understands the current status of their organisations. These individuals were also interviewed.
Basically, (1973), initiated that it is advisable to use the formula in choosing sample sizes. Thus, the sample size (10) of the population in this paper was determined by formula. The formula of (1960) is given as follows:
Where:
n = a sample size
N= population size
e= desired margin of error (percent allowance for non-precision because of the use of the sample instead of the population).
3.4 Data Analysis
When the entire interview responses and information from have been collected, the researcher used statistics to analyse all the ratios; and was assisted by the SPSS in coming up with the statistical analysis for this study. For the interview, an evaluation was drawn in order to identify factors pertaining to the financial status of the banks with regards to Financial Tsunami of 2008. Moreover, this research will utilize the several statistics in order to determine the differences and compare the past and previous performance of banks in Hong Kong in terms of profitability ratio, liquidity ratio, efficiency ratio and ROCE.
As stated above, the researcher will be assisted by the Statistical Package for the Social Sciences (SPSS) in coming up with the statistical analysis for this study. SPSS is one of the most widely available and powerful statistical software packages that covers a broad range of statistical procedures, which allows a researcher to summarize data (e.g., compute means and standard deviations), determine whether there are significant differences between groups (e.g., t-tests, analysis of variance), examine relationships among variables (e.g., correlation, multiple regression), and graph results (e.g., bar charts, line graphs) ( 2000). And from the ratios collated, the researcher will be using the paired-sample t-test.
3.4.1 Paired Sample T-test
Basically, (1994) stated that the paired sample t-test is the most commonly used method to evaluate the differences in means between two samples. For example, the t-test can be used to test for a difference in the past performance of a certain firm (i.e. financial ratios in 2007 and 2008). Theoretically, the t-test can be used even if the sample sizes are very small, as long as the variables are normally distributed within each group and the variation of scores in the two groups is not reliably different (1994). And since we were be dealing of financial ratios in which the numbers are fixed then paired sample t-test would be appropriate. As mentioned before, the normality assumption can be evaluated by looking at the distribution of the data (via histograms) or by performing a normality test. The equality of variances assumption can be verified with the F test, or you can use the more robust test (1994). If these conditions are not met, then you can evaluate the differences in means between two groups using one of the nonparametric alternatives to the t- test. Actually, the researcher opted to use paired sample t-test analysis to determine the difference between the past and current performance among banks in order to identify if the financial tsunami of 2008 created an impact to them.
In addition, the p-level reported with a t-test represents the probability of error involved in accepting our research hypothesis about the existence of a difference (1994). Technically speaking, this is the probability of error associated with rejecting the hypothesis of no difference between the two categories of observations (corresponding to the groups) in the population when, in fact, the hypothesis is true.
As pointed out by (1994), that if the difference is in the predicted direction, you can consider only one half (one “tail”) of the probability distribution and thus divide the standard p-level reported with a t-test (a “two-tailed” probability) by two. However, the report should always standard, two-tailed t-test probability. Apparently, when testing for a relationship between two variables, sometimes there is a 3rd variable, which we are not interested in at the moment, which influences the results.
So, the null hypothesis (Ho: x and y are independent), can also be written as:
Ho: mD= 0, where mD = population mean of difference scores
df = N – 1, where N = the number of pairs of participants
Then, using the standard “template” suggested by (1994) for our inference test, we have:
3.5 Limitations
When interpreting the results of this research, several issues should be kept in mind. First, ratings in this study will be made for developmental purposes only, which raise a question about the generalisability of to results to ratings provided in the context of decisions. In light of their findings the generalisability concerns expressed above may be minor. Another issue pertains to the conditions under which ratings were obtained in the study and their potential effects on the subsequent ratings. Managers’ participation in the study was voluntary, indicating that they were actively seeking feedback about the banks financial performance in response to Financial Tsunami of 2008. We do not know how these raters perceived the feedback-seeking behavior of target managers in this study, nor do we know how or if the performance of managers who participate voluntarily differs from the performance raters who do not. Both of these issues appear to be worthwhile topics for future research. Despite these potential limitations, we believe there are several features of this study that enhance its contribution to the literature.
After the respondents answered in the interview, the researchers then asked them to cite the parts of the questions that need improvement. The researcher even asked for suggestions and corrections from the respondents to ensure that the interview-questionnaire is effective.
3.6 Summary
In summary, the researcher will have taken four major phases to complete the study.
Phase 1: Problem Identification for Research
In the first phase, the researcher identifies the specific focus of the problem to be researched. This involves reviewing existing theory, research, and practices from professional literature. This process helps me integrate theoretical perspectives and empirical findings with my own understanding of the problem, and discern the aspect of the problem the researcher want to research and learn more about.
Phase 2: Administration of the Instrument
After reviewing literature, the researcher formulates questions for the interview and makes a set of guide questionnaires for the interview. These are then presented to the advisor for validation purposes. After this the researcher will initiate a process of building collaborations with the individuals who will participate in the study.
Phase 3: Data Collection and Analysis
In the third phase, the researcher will collect and analyse data for the purposes of identifying critical cultural/contextual variables specific to their setting particularly in banking setting. These data will enable me to achieve a specific understanding of the problem.
Phase 4: Data Synthesis and Generation of Recommendations
In the fourth phase, the researcher will synthesize findings from the previous phases and relevant previous research. The focus of this stage is to synthesize these data to modify existing hypotheses and account for different factors, as well as generating recommendations based on new understandings. During this phase, research-based, culture-specific recommendations for action will be generated.
Questionnaire
The researcher is conducting a study on the adverse impacts of the recent financial tsunami taken place in 2008 on the performance of the “Bank Industry” in Hong Kong in terms of profitability ratio, liquidity ratio, efficiency ratio, and ROCE. To enable the researcher to make the necessary conclusions and recommendations for this study, it would be very much appreciated if you answer all the items in the questionnaire.
Information given will be treated in strictest confidence.
Thank you.
Part I. Demographic Data
Direction: Please fill up in all the necessary information about yourself. Don’t leave any item unanswered.
a. Name: ___________________________________________
b. Age: ________
c. Gender:
Male ( ) Female ( )
d. Civil Status:
Single ( ) Married ( ) Separated ( ) Widow/Widower ( )
e. Educational Attainment
Elementary ( ) High School ( ) College ( ) Graduate ( )
f. Name of your Bank:_____________________________________________
g. Interview Number ____________
h. Interview Date ____________
Part II. Problems and Solutions
Directions: List down your concerns and suggestions regarding the impact of the recent financial tsunami taken place in 2008 on the performance of your Bank in terms of profitability ratio, liquidity ratio, efficiency ratio, and ROCE.
What are the most common problems that your organisation encountered with regards to the recent Financial Tsunami?
a. ______________________________________________________________
b. ______________________________________________________________
c. ______________________________________________________________
What solutions would you suggest to solve these problems you’ve mentioned?
a. ______________________________________________________________
b. ______________________________________________________________
c. ______________________________________________________________
Interview Questions
INTERVIEW QUESTIONS
1. How long have you been working in your organisation?
2. What is your idea regarding the recent Financial Tsunami?
3. In your opinion, what is the primary reason of its occurrence?
4. Do you think the recent financial tsunami created an adverse impact to the overall businesses in Hong Kong? In what ways?
5. Do you think the recent financial tsunami created an adverse impact to the Banking Industry of Hong Kong? In what ways?
6. Do you think the recent Financial Tsunami created an adverse impact in your bank? In what ways?
7. For you, what are the possible factors in Financial Tsunami that could affect the bank’s performance?
8. Now that your bank has still performing, are you satisfied with your previous performance? Explain.
9. Based on the financial ratios of your bank, what is your organization’s edge compared to other banks?
10. Finally, what are visions of the organisation as regards to its future?
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