Research Case 1: A complete research from broad area problem to policy implication

A Hospital in West Jakarta have spent substantial amount of resources in fostering satisfaction of customers, simply based on believed that satisfaction is the most important factor in determining loyalty of their customers, an assertion that has not been tested empirically. The Board of directors wants to know if satisfactions of their customers on the service they provide determines the loyalty of the customers, the ultimate and long term objective which is stated in their strategy. They then requested a service of a consultant to answer their inquiry. The consultant begins by designing the research. He identified two variables are involved, i.e., loyalty and satisfaction. He further translated the research question (the inquiry), by its nature as equivalent to answering question as to whether satisfaction has an impact (or cause) on loyalty. Statistically this is a regression problem, with loyalty ($latex Y$) being the dependent variable and satisfaction (X) being the independent variable, with the following functional relationship (mathematically).