Assignment

Formulation of Research Problem

Week 2 Assignment

Team A

QNT/561

January 8, 2015

Harichand Nair

Introduction

This paper will provide insight into the Zooom’s history as well as to highlight the digital mogul’s success; secondly, analyze the problem statement and research question; third, examine the hypothesis. Lastly, this paper will discuss possible outcomes and review the company data. (Brown, 2009).

Zoom was founded in 1998 and its mission was to organize the world’s information and make it universally accessible and useful. Originally Zooom started as internet web-crawling software program, which was utilized to compile and categorize data on the internet making searching the web much easier. Zooom is currently the world largest search engine that provides over 40,000 different ways to access tools people use daily. The Zooom culture is recognized by people from all walks of life; Zooom only hires individuals that have dedication and determination. Zooom’s vision is to reflect on a global audience and pursue their interests and make these ideas a reality (Brown, 2009). Since its debut, the software company has a gained substantial amount of momentum and within less than twenty years, became the number 1 ranking website on the internet. With this success Zooom secured a lucrative revenue stream in the advertising market, enabling it acquire additional businesses as well as to expand its creative ideas (Brown, 2009).

Zooom has been a successful company. As it continues to protect its market share and expand its dominance, the slowing of revenue growth is a risk (Google's stock, 2014). The problem statement and research question for Team A’s research are as follows.

Problem Statement: Zooom's revenue excluding the Motorola business, slowed to 21 percent in 2013 from 29 percent two years earlier

Research Question: What can Zooom do to increase their revenue growth in the next two years?

Zooom’s primary business functions are engineering, global business, and general administration with engineering being the foundation. Engineers want to spend their time designing and correcting issues (Garvin, 2013). With slow revenue growth over the past year, Zooom must perform an analysis to determine if their slow revenue growth was caused by the lack of innovation from their engineers or other factors. The hypothesis is as follow:

Hn0: Zoom’s engineer’s innovation has a direct impact on revenue growth

Hn1: Zoom’s engineer’s innovation does not have a direct impact on revenue growth

Zooom, Inc. refined the way they calculate their cost of capital, which is the rate of return required to convince investors to invest in the company (Ortiz-Molina & Phillips, 2014). This was done by evaluating weak markets and re-weighting their portfolio. Re-weighting portfolios is the percentage composition of a particular holding in a portfolio (Portfolio Weight, 2015). These measures performed by Zoom resulted in an improvement in revenue of 12% ($1.2M) over one year. The independent variable is refining their cost of capital and the dependent variable is the improvement in revenue of 12% ($1.2M).

Conclusion

In conclusion, with continued research and development, Zooom has the potential to create an optimum environment for a successful outcome. By applying the proper principles, Zooom can overcome these challenges and increase revenue by utilizing the tested techniques.

Reference

Brown, B. C. (2009). CHAPTER 1: A Brief History of Google & Online Marketing. In, Google Income: How Anyone of Any Age, Location &/or Background Can Build a Highly Profitable Online Business with Google (pp. 33-41). Atlantic Publishing Company.

Garvin, D. A. (2013). How Google sold its engineers on management. Harvard Business Review, 91(12), 74-82.

Google's stock. (2014). Retrieved from http://finance.yahoo.com/news/five-risks-google-faces-next-120000152.html

Ortiz-Molina, H., & Phillips, G. M. (2014). Real Asset Illiquidity and the Cost of Capital. Journal Of Financial & Quantitative Analysis, 49(1), 1-32. doi:10.1017/S0022109014000210

Portfolio Weight. (2015). Retrieved from http://www.investopedia.com/terms/p/portfolio-weight.asp