I’m on a plane right now reading an article in the United Airlines’ Hemispheres magazine about "ethnography," meaning studying what people do instead of what they say. This makes a lot of sense to me, because what people say – in the user survey or the focus group, for example – is often not related to what they do. I hate surveys that ask people what they intend to buy, or what they would pay as a price, or what influenced their purchase, because, frankly, people lie to researchers and lie to themselves.
Ethnography, on the other hand, is studying what people do. The article "Redefining Research" by Karen Kroll starts with a nice example of cup manufacturer OXO studying how people actually use a measuring cup, rather than what they say about a measuring cup. "Everyone would place the cup on the counter, partially fill it, check the amount, pour a bit more, and repeat until they had the proper amount." As a result of the study, OXO introduced a measuring cup with calibrations visible from the top. It was a big success.
The term links back to study of human cultures, which sounds very academic, but in the business context it’s studying what people do. Another example: rather than asking people what they do at dinner, observe them as they prepare and eat their dinner. An IBM team followed system administrators around to understand their jobs well, then came out with software improvements related to communicating IT information to the rest of the company. Nokia used ethnography to observe how target customers in developing countries used their cellphones.
And I’m off the plane now, following up, and it turns out that the story I read is available online, as Executive Secrets: Green House Effect. I’ve done the requisite Web search without finding much additional information, but the story is worth reading.