Professional Documents
Culture Documents
ISBN: 978-81-909312-3-8
ISBN: 978-81-909312-3-8
CONFERENCE PROCEEDINGS
EDITORIAL TEAM
EDITORS
Dr.R.Venkatamuni Reddy
Dr.R.Jayanthi
Prof.M.Muthu Gopalakrishnan
CHIEF EDITOR
Dr.H.R.Venkatesha
Published By
Acharya Bangalore B School
Andhrahalli Main Road,
Off Magadi Road, Bengaluru-560091.
Foreword
In order to survive and grow with Excellence in their fields, the organizations of all shades
have to be competitive. This applies to both business and non-business organizations. In this
background, we, at Acharya Bangalore B-School (ABBS), are organizing our 6th
International Conference for two days on the theme Managing Business Competitiveness
through Technology, Innovation and Big Data on 17th and 18th December, 2015.
More than hundred delegates from India and abroad are presenting their research articles in
this conference. In this era of paper-less organizations, I feel honored to place the Conference
Proceedings in CD format in your hand. In this CD, there are two parts: Part A contains
articles directly related to the Conference Theme and Part B has the other articles. There are
articles on application of Technology in Human Resource Management, Financial
Management, Operations Management and Marketing Management. Digital Technology in
Marketing is one of the pet topics of the researchers. Many articles emphasize the ways in
which Innovation and Big Data make business competitive.
I am sure this Conference would be successful not only in adding value to the existing
knowledge of the Conference Theme, but also successful in giving new insights to all the
participants of the Conference and to the readers of the Proceedings.
The overwhelming response we got for this Conference from the delegates, sponsors and the
resource persons has become possible only because of the concerted efforts of my colleagues
- Dr. K.S.Srinivasa Rao, Dr. R. Venkatamuni Reddy, Dr. R.Jayanthi and Prof. M.Muthu
Gopalakrishnan. I profusely thank them for their single minded dedication to make the
Conference a grand success.
Dr.H.R.Venkatesha
Director
Acharya Bangalore B-School
CONTENT
Part-A
S#
Paper Code
Author(s)
1.
IC2015D601
Ergonomics: An Enhancement
Catalyst towards Technology in HRD
1 - 10
2.
IC2015D602
A Conceptual Framework of
Technology used in HRD
11 - 23
3.
IC2015D605
24 - 46
4.
IC2015D609
47 - 58
5.
IC2015D610
59 - 67
6.
IC2015D611
7.
IC2015d617
Mr. Rajanna,
99 - 105
8.
IC2015D618
9.
IC2015D621
10.
IC2015D622
11.
IC2015D629
Page
Number
and
68 - 98
106 - 112
Ms. Shashikala S N
113 - 120
121 - 125
126 - 131
12.
IC2015D631
Prof. VS Chauhan,
and Mr. Sachchidanand,
13.
IC2015D637
Mrs. KirthikaPrasanna
14.
IC2015D640
Role of Innovation on
Entrepreneurship
ICT Uses In Education System
15.
IC2015D641
16.
IC2015D650
Mr. K.Vikram
132 - 146
147
148 - 153
154 159
160 - 174
BhagyaLakshmi . K
17.
IC2015D654
18.
IC2015D655
Dr.K.Ramachandra ,
Mr. Jayaram. A and
Mr. Balaji. M
Dr.R.S.Ramesh and
175 - 187
188 - 207
Mr. Rakesh. N
19.
IC2015D656
Technology in Governance
Ms. Rajini.K.S
208 - 220
20.
IC2015D659
Dr. SoundaraRajan,
Dr.R.Venkatamuni and
Mr. Somnath
221 - 231
21.
IC2015D662
232 - 247
22.
IC2015D664
Ms.
SheejaKrishnakuamar
and Mr. Avijit Sarkar
248 - 263
23.
IC2015D665
Dr. R S Ramesh
and
Mr. ManjunathDaler
manjuuti
264 - 270
24.
IC2015D668
271 - 297
25.
IC2015D670
298 - 313
26
IC2015D673
Dr. Geetha. R,
314 - 334
27
IC2015D677
Dr.UshaDevi.N and
Smt. Bhagya GB
335 - 344
28
IC2015D678
Mr. SujayMugaloremutt
And
Dr. A.Dhanalakshmi
345 - 349
29
IC2015D679
350 - 357
30
IC2015D680
Mr. ChethanJayantha
and
Dr. A. Dhanalakshmi
Ms. Madhumati.VB
31
IC2015D687
32
IC2015D691
Dr. R. Venkatamuni
Reddy
andProf
A.NagarajSubbarao
364 - 382
33
IC2015D693
Impact of Technology-Based
Learning on Employee Performance
383 - 393
34
IC2015D694
394 - 399
35
IC2015D695
Technology in Marketing
Mr. DevashishGoswami
and Prof. MohanaRoopa
Ms. KapilaJaykumar
36
IC2015D696
Prof. GrishmaPadhye
and
358 - 362
363
400 - 411
412 - 418
Dr. Sonam
37
IC2015D697
419 - 432
38
IC2015D698
39
IC2015D699
Ms. Roopa MS
433 - 442
443 - 458
Dr. Manjunath, K. R
40
IC2015D700
459 - 473
41
IC2015D704
474 - 485
Part-B
S#
Paper Code
Author(s)
Page
Number
486 - 497
42
IC2015D603
Mr. G.
Vinayagamurthy and
S. Ganapathy
43
IC2015D606
498 - 505
44
IC2015D607
Ms. Kalyani.K
and
Dr. HaseenTaj
506 - 514
45
IC2015D608
515 - 524
46
IC2015D613
Mr. Ragavendra G
525 - 534
47
IC2015D614
535 - 544
48
IC2015D615
Prof. Nethravathi.N
545 - 550
49
IC2015D616
Mr. L.R.Manjunatha ,
and
Dr.Sandhya.R.Anvek
ar
551 - 578
50
IC2015D625
IC2015D627
Dr. S.
Sathyanarayana and
SN Harish
Ms. PuneetaGoel, and
Dr. R S Ramesh
579 - 619
51
52
IC2015D628
641 - 653
620 - 640
53
IC2015D630
Ms. KritikaDadheech
654 - 663
54
IC2015D632
Mrs. Bharathy
664 - 676
55
IC2015D634
Dr. M. Raja
677 - 696
56
IC2015D635
697 - 704
57
IC2015D636
Ms.
NikithaSreekantha
and
Mr. Arun B.K
705 - 718
58
IC2015D638
Mrs. Surekha V.
Nayak and
Dr Anjali Ganesh
719 - 729
59
IC2015D639
Prof. PraveshSoti
730 - 750
60
IC2015D642
751 - 774
61
IC2015D643
Dr. Amir M
Nasrullahand Ms.
Shalini
775 - 799
62
IC2015D644
800 - 817
63
IC2015D645
Dr. Mahesh
Agnihotri and Dr.
Anil Roy Dubey
Dr. R S Ramesh, and
Prof. VS Chauhan
64
IC2015D646
Dr.P.Chellasamy and
Ms.Anu.K.M,
831 - 847
65
IC2015D649
Dr.P.Paramashivaiah
and
Dr. Raviraj Hegde
848 - 868
818 - 830
66
IC2015D651
67
IC2015D652
882 - 892
68
IC2015D653
Mrs.
PavaniDevulapalli
and Dr K H
Anilkumar
Mr. T. Ravikumar,
and Mr. M. Sriram
69
IC2015D657
I Bharat Mahan
899 - 907
70
IC2015D661
Ms. P.V.Chandrika
and
Mr. Suresh Samadhi
908 - 923
71
IC2015D663
924 931
72
IC2015D666
73
IC2015D667
Mrs. RohiniSajjanand
Dr. H.R Venkatesha
933 940
74
IC2015D669
941
75
IC2015D671
942 947
76
IC2015D672
Dr. P.
Natesan,Ms.A.Saroj
a and
Mr. Tom C Mathai
948 956
77
IC2015D675
Dr.A.Dhanalakshmi
and
957 - 968
Mr. S.Rohitraj
869
- 881
893 - 898
932
78
IC2015D676
Mr. S.Rohitraj
and Dr.D.H.Rao.
969 - 979
79
IC2015D682
980 992
III PGDM
Acharya Academy of
Mgt Studies
80
IC2015D683
Ms. Raveena
993 1000
III PGDM
Acharya Academy of
Mgt Studies
81
IC2015D684
1001
1010
III PGDM
Acharya Academy of
Mgt Studies
82
IC2015D688
Ms. Debanjana
1011
1014
III PGDM
Acharya Academy of
Mgt Studies
83
IC2015D689
1015 1023
KritikaDadheech
84
IC2015D692
1024
1029
85
IC2015D697
1030
1043
86
IC2015D701
1044
1049
87
IC2015D706
Dr.V.Selvam and
Dr. Ravindran
Ramasamy
1050
1064
DHRUV RANA
DIKSHA BISWAS
Introduction:
In its triennial report, the International Ergonomics Association (IEA, 2000) defined
Ergonomics as the scientific discipline that deals with understanding the interaction between
humans and other elements of a socio-technical system. In this definition, Ergonomics is the
profession that applies theory, principles, data and design methods to optimize human wellbeing and the overall performance of a system. It is in particular responsible for the design
and evaluation of tasks, jobs, products, environments and systems to make them compatible
with the abilities, needs and limitations of people.
The word "Ergonomics" comes from the Greek "Ergon" meaning work and "Nomos" which
means law. Therefore, etymologically, this is the science of work. The term has been used
historically in the European tradition. In the American tradition one finds the term "Human
Factor Engineering" to refer to the same issues, so both terms can be now considered as
synonyms and are used interchangeably. Some of the other terms can also be highlighted as
human factor society founded in Tulsa (Oklahoma) in 1957 now called the "Human Factor
and Ergonomics Society (HFES). Another term which is often used in the same context is
Engineering psychology (Wickens & Hollands, 2000).
Ergonomists (with many applied psychologists among them) are in a permanent search for
comprehensive approaches in which physical, cognitive, social and environmental aspects of
human activities can be considered. Although ergonomists often work on different economic
sectors or particular tasks, these application domains are constantly evolving, creating new
ones and changing the perspective of the old ones. Accordingly, one can recognize today four
main domains of expertise crucial for investigating interaction between humans and sociotechnical systems.
Areas of Application
Industrial Areas
Human-Computer
Interaction
Transportation
Control processes
technological innovations. User-centred design aims at describing the human being who
interacts with the system from the viewpoint of cognitive science.
This paradigm has led to the establishment of us ability research that has contributed greatly
to the effectiveness, efficiency and satisfaction of users in their interaction with the
technologies and to a better interaction between users through technology (Holzinger, 2005).
However, one can at present witness a paradigm shift in the interaction that requires a change
in how to understand and to evaluate usability. The change is motivated by the design of new
applications and services under the influence of increasingly fast convergence of nano-, bioand information technologies with cognitive science (see, e.g., NBIC-Report, 2006). This
new development has several features that force cognitive ergonomists to re-think the concept
of interaction. Those features are, first of all, that applications are designed to be used in
intelligent and mobile environments.
Domains of Ergonomics:
During the last years, Ergonomics became one of the reference domains in the managerial
theory and practice. Ergonomics is a major component of the human resources management
and also, it is an important factor of performances. Ergonomics is the link between efficiency,
effectiveness, security and heath and in this context it is necessary to approach the
Ergonomics and its impact on the process of the organizational development and on the
employees. So altogether Ergonomics plays a vital role in each segment of an individual,
corporate (National-multinational) as well as global level. Various Domains of Ergonomics
have been highlighted as;
Physical Ergonomics deals with the anatomical, anthropometric, physiological and
Biomechanical parameters in static and dynamic physical work. Among the main topics are
the physical postures that people adopt when they are working, fatigue and other problems
associated with handling physical and musculo-skeletal tasks associated with physical efforts.
Cognitive Ergonomics is a sub-discipline of Ergonomics that studies the cognitive
processes at work with an emphasis on an understanding of the situation and on supporting
reliable, effective and satisfactory performance. This approach addresses problems such as
attention distribution, decision making, formation of learning skills, usability of humancomputer systems, cognitive aspects of mental load, stress and human errors at work.
Neuro Ergonomics is a relatively new development which involves the application of more
in-depth neurophysiological methods such as brain imaging techniques. This advanced
3
methodology can be used for evaluating the customers preferences for one or another design
of human-computer interfaces or for a particular version of industrial products (this latter task
is sometimes related to the field of neuromarketing).
Social or Organizational Ergonomics deals with the optimization of sociotechnical work
systems, including their structures, policies and organizational processes. Thus, ergonomists
are often involved into the social design of communication systems, interaction routines
within the working groups, times and shifts schedules in a company, and other related issues.
psychologists
(from
the
various
subfields
of industrial
and
organizational
Ethnographic analysis: Using methods derived from ethnography, this process focuses
on observing the uses of technology in a practical environment. It is a qualitative and
observational method that focuses on "real-world" experience and pressures, and the
usage of technology or environments in the workplace. The process is best used early in
the design process.
Iterative design: Also known as prototyping, the iterative design process seeks to
involve users at several stages of design, in order to correct problems as they emerge. As
prototypes emerge from the design process, these are subjected to other forms of analysis
as outlined in this article, and the results are then taken and incorporated into the new
design. Trends amongst users are analysed, and products redesigned. This can become a
costly process, and needs to be done as soon as possible in the design process before
designs become too concrete.
Task analysis: A process with roots in activity theory, task analysis is a way of
systematically describing human interaction with a system or process to understand how
to match the demands of the system or process to human capabilities. The complexity of
this process is generally proportional to the complexity of the task being analysed, and so
can vary in cost and time involvement. It is a qualitative and observational process.
"Wizard of Oz": This is a comparatively uncommon technique but has seen some use in
mobile devices. Based upon the Wizard of Oz experiment, this technique involves an
operator who remotely controls the operation of a device in order to imitate the response
of an actual computer program. It has the advantage of producing a highly changeable set
of reactions, but can be quite costly and difficult to undertake.
Methods Analysis is the process of studying the tasks a worker completes using a stepby-step investigation. Each task in broken down into smaller steps until each motion the
worker performs is described. Doing so enables you to see exactly where repetitive or
straining tasks occur.
Time studies determine the time required for a worker to complete each task. Time
studies are often used to analyse cyclical jobs. They are considered "event based" studies
because time measurements are triggered by the occurrence of predetermined events.
Work sampling is a method in which the job is sampled at random intervals to determine
the proportion of total time spent on a particular task. It provides insight into how often
workers are performing tasks which might cause strain on their bodies.
Predetermined time systems are methods for analyzing the time spent by workers on a
particular task.
Anti--fatigue matting:
Reduces standing fatigue, improves productivity, and helps prevents lips and falls.
Monitor arms:
Makes the monitor easily adjustable to each workers eye level, reducing eye and neck strain.
Keyboards and keyboard support Systems:
An Ergonomic keyboard keyboard tray
At the correct height for each worker helps keep wrists straight and elbows open slightly
beyond 90 degrees.
Computer mice/input devices:
The best computer
Mice keep your arm relaxed while using the device, thus reducing muscle tension in the arm
and wrist.
Footrest: Footrests raise feet to relieve strain on lower back and thigh muscles.
Perfect for longer periods of deskwork or as just a great way to relax.
Palm/wristsupports:
Provides support and allows users hands to freely move above the keyboard while typing.
Task Lighting:
In hospitals ,accurately reading reports and other paper documents requires optimum task
specific lighting without the glare and reflection caused by overhead lighting schemes.
How can Ergonomics and human factors improve health and safety?
Applying Ergonomics to the workplace can:
Reduce the potential for accidents;
Reduce the potential for injury and ill health;
Improve performance and productivity
Taking account of Ergonomics and human factors can reduce the likelihood of an accident.
For example, in the design of control panels, consider:
the location of switches and buttons switches that could be accidentally knocked on
or off might start the wrong sequence of events that could lead to an accident;
8
Expectations of signals and controls most people interpret green to indicate a safe
condition. If a green light is used to indicate a warning or dangerous state it may be
ignored or overlooked;
Information overload if a worker is given too much information they may become
confused, make mistakes, or panic. In hazardous industries, incorrect decisions or
mistaken actions have had catastrophic results.
What kind of workplace problems can Ergonomics and human factors solve?
Ergonomics is typically known for solving physical problems. For example, ensuring that
emergency stop buttons are positioned so that people can reach them readily when they need
to. But Ergonomics also deals with psychological and social aspects of the person and their
work. For example, a workload that is too high or too low, unclear tasks, time pressures,
inadequate training, and poor support from managers can all have negative effects on people
and the work they do.
The following examples highlight some typical ergonomic problems found in the
workplace:
Design of tasks
Work demands are too high or too low.
The employee has little say in how they organise their work.
Badly designed machinery guards (awkward to use or requiring additional effort)
slow down the work.
Conflicting demands, e.g. high productivity and quality.
These problems can lead to employees failing to follow procedures or removing guards,
causing accidents, injury and ill health.
Manual handling
The load is too heavy and/or bulky, placing unreasonable demands on the person.
The load has to be lifted from the floor and/or above the shoulders.
The job involves frequent repetitive lifting.
The job requires awkward postures, such as bending or twisting.
The load cant be gripped properly.
The job is performed on uneven, wet, or sloping floor surfaces.
The job is performed under time pressures and doesnt include enough rest breaks.
These problems may lead to physical injuries, such as low back pain or injury to the arms,
hands, or fingers. They may also contribute to the risk of slips, trips, and falls.
Workstation layout
9
10
11
INTRODUCTION
The literature in HRD does not view the areas of learning and performance the same
However, the overall goal is to improve the individual and/or organization in a specific area.
Human Resource Development (HRD) is an emergent field that builds upon multiple
disciplines including psychology, business, and education (Kuchinke, 2001). The HRD field
is well established in practice, however has had only a brief formal existence in academia in
12
comparison to many other disciplines (Swanson and Holton, 2001). When examining the
theories of HRD, Weinberger (1998) reported definitions in the field as early 1970. Only
recently has HRD been identified as a field in academia. According to the National Centre for
Education Statistics the Classification of Instructional Programs: 2000 Edition identified
HRD as a new academic discipline and provided a specific code in 2000.
The literature has provided many definitions of HRD. The definitions of HRD key
components demonstrate the multi-disciplinary nature of the field and include behavioural
change, adult learning (formal and informal), performance (human, organizational,
individuals level, work process), performance improvement, organizational and personal
goals, development (career and organizational), training and development, learning, learning
climate, and learning organizations. Key definitions have a variety of underlying theories
including
psychological,
systems,
economic,
philosophical,
human
performance,
HR
Departments or
re-designated their
HRD
requires well
structured
function and
appropriately
identified HRD systems, and competent staff to implement and facilitate the change process.
The consultants differentiated the HRD from other components of Human Resource
Function (HRF) and also integrated structurally and system-wise. Structurally the HRF is to
13
be a subsystem of HRF and integration of this with the other two subsystems (Personnel
Administration and
example Vice-President Personnel & HRD), through task forces and sub-system linkages.
Inter system linkages were outlined between various HRD
subsystems to
have an
integrated system. The principles designed deal with both the purpose of HRD systems and
the process of their implementation. Some of these principles include:
1. HRD
the
systems
should
help
individuals
to
help
perform;
3. HRD
systems
should
help
maximize individual
should
facilitate
responsibility;
4. HRD
systems
decentralization
responsibility;
5. HRD systems should facilitate participative decision-making;
6. HRD
to
balance
the
renewal of
the function. In
sum, the
Integrated HRD systems approach of Pareek and Rao (1975) has the following elements:
A separate and differentiated HRD department with full time HRD staff.
After L&T accepted these recommendations in full and started implementing, the State
Bank of India the single largest Indian Bank and its Associates have decided to use the
Integrated HRD systems approach and decided to create new HRD Department. Since
then, by mid eighties a large number of organizations in India have established HRD
Departments.
14
It has been quite obvious how instructional technologies have impacted the process of
training and development. Furst-Bowe (1996) stated that the HRD professional does not need
to concentrate on the development as much as the use and evaluation of instructional
technologies. The changing technologies have offered a variety of methods to deliver
training, reduce costs, and provide many options for training. How this impacted the HRD
professional is not the question. The question is how much it has impacted the role of the
HRD professional. First, technology is changing many of the solutions available for the HRD
professional in the areas of learning and performance in addition to changing many of the
traditional administrative tasks. However, the role of the HRD professional is still to help
improve the organization and individual. The traditional trainer is identified as a coach or
facilitator, not someone that stands up in front of classroom and delivers training. He or she
needs to be skilled in instructional design, organizational change, and organizational
behaviour. Since HRD is defined broadly, the implementation of technology and the use of
instructional technology are impacting the role of the HRD professional. While the
overarching theories are similar and the models are still appropriate, the areas of design and
develop have been impacted the most.
GLOBALIZATION
DIVERSITY RECRUITMENT
With the rise of globalization, companies of all sizes are now interacting with
customers and stakeholders from diverse cultures, languages and social backgrounds. In
response, many human resources managers seek to hire employees from equally diverse
backgrounds. Companies engaging in this diversity recruitment recognize the value of having
people on staff that their customers can relate to, and they know that having a team of diverse
people contributes to the range of ideas and influences within the organization.
SOCIO-ECONOMIC DEVELOPMENT
Socio-economic development is a process that seeks to identify both the social and the
economic needs within a community, and seek to create strategies that will address those
needs in ways that are practical and in the best interests of the community over the long run.
The general idea is to find ways to improve the standard of living within the area while also
16
making sure the local economy is healthy and capable of sustaining the population present in
the area. Socio-economic development occurs in neighbourhoods in metropolitan areas,
sections of smaller cities and towns, and even in rural settings.
There are a number of factors that must be considered as part of any socio-economic
development effort. Understanding the current circumstances that prevail in the area is the
first step toward regional development. By assessing the potential of human capital in the
area, allowing for the current unemployment rate and when laws and regulations are currently
in place that may be impeding the introduction of new industry into the area, it is possible to
begin developing a plan that will ultimately mean more jobs, stable employment for more
households, and more money flowing through the local economy.
A national drug policy requires a wide range of skills. Staff at all levels needs to be
familiar with key policy issues that affect the quality, supply and use of drugs, and should
understand the key objectives of the drug policy. For each category of personnel, the nature
and extent of their involvement in the policy should be clearly defined. This will make it
possible to decide on the orientation and level of training required for each category.
There should be a number of minimum educational and training requirements for each
category. For example, personnel and staff involved in specific activities to ensure the quality
of drugs should be given adequate training in specific areas of quality assurance. Those
17
involved in the drug supply system should receive training in management, supervision and
certain administrative skills that they require.
FORMAL TRAINING
While all levels of education have been impacted by instructional technology,
technology has specifically impacted how vocational, post secondary, and higher education
develops the workforce. While human resource development encompasses many areas
including performance improvement, organizational analysis, employee relationship
management, evaluation, leadership, and organizational change management; a large role of
human resource development is viewed in terms of training and employee development.
Within HRD, training and development has had the greatest impact from instructional
technologies. According to Marsick and Watkins Formal learning is typically institutionally
sponsored, classroom-based, and highly structured Formal learning can be mediated by
technology and is becoming an ever increasingly used technique in the workplace (Benson,
Johnson, and Kuchinke, 2002). This section will highlight web-based instructional
technologies such as learning management software, synchronous learning tools, and
asynchronous instructional technologies for formal training and employee development.
INFORMAL TRAINING
Informal training is defined in contrast to formal learning. Informal learning is
usually intentional but not highly structuredWhen people learn incidentally, their learning
may be taken for granted, tacit, or unconscious (Marsick and Watkins, 2001). Examples of
informal learning can include self-directed learning, networking, coaching, mentoring, and
performance planning that includes opportunities to review learning needs (Marsick and
Watkins, 2001).
Many of the technologies that have been described above for formal training can also
be used in informal training settings. Having a course designed and available without an
instructor present provides a setting that supports self-directed learning. Learning
18
management software can be used to design this type of course and make it available to
employees. Instant messenger can be used to help individuals in work teams learn in informal
settings. This technology can be used to see answers to questions on an as needed basis. An
example of informal training using a Blog can be seen at the University of South Carolina.
The Technology Support and Training Management Department implements a blog with their
current students to share information on classes and special announcements. This type of
forum can also be used in a formal business setting.
The government should take responsibility for planning and overseeing the
development of the necessary human resources. The strategies chosen should realistically
reflect the needs and capacity of the country, and an adequate budget should be allocated.
Consideration of the following aspects will help to ensure the development of a human
resources policy that is supportive of national drug policy implementation.
It is necessary to plan from an early stage and to do so for short-, medium- and
longer-term needs. A quantitative analysis of the human resources needed (including a
realistic estimate of the attrition rate) may help to set priorities. Financial planning should
match the financial resources with priority needs. Good planning and appropriate lead times
will help to ensure that a sufficient number of trained people are available. Plans should
include a career development policy and measures to retain staff in the service.
Harassment Training
Performance Management
Career Coaching
19
Activities that require specialist expertise - for example, drug evaluation and drug
information services - can often be carried out more effectively within universities, training
institutions or professional societies than within the health ministries. Collaboration between
drug regulatory authorities and universities, research institutions, professional societys and
individuals maximizes the use of national expertise and resources. It also builds up a network
of people who are knowledgeable and involved in the development and implementation of
the drug policy. Outside specialists can fill gaps where national expertise is lacking and can
be used in national training programmes to pass on their expertise. When appropriate,
professionals can be sent for short training programmes abroad.
INFORMATION
Today's systems cover the full spectrum of tasks associated with Human Resources
departments, including tracking & improving process efficiency, managing organizational
hierarchy, and simplifying financial transactions of all types. In short, as the role of Human
Resources departments expanded in complexity, HR technology systems evolved to fit these
needs.
1. Payroll
2. Time and attendance
3. Performance appraisal
4. Benefits administration
5. HR management information system
6. Recruiting/Learning management
7. Performance record
8. Employee self-service
9. Scheduling
10. Absence management
21
11. Analytics
With the increase in bandwidth when using Internet technology and the growing
number of individuals with computer access, the possibilities are endless. With the push to
open source learning management systems, it is possible for many organizations to afford
instructional technologies for training. The use of strong evaluation to demonstrate what is
working will provide a positive impact on HRD. HRD professionals collecting and providing
evidence of success in terms of strategic business areas will additionally help the profession
strengthen. Instructional technologies are creating many opportunities for informal learning.
Additionally, many of the instructional technologies mimic a business environment that is
today calling for global collaboration, continuous learning, and knowledge management. If
used strategically, the instructional technologies can be used to create a learning culture and
help keep competitive advantage. This can help in the creation of an organization that has the
ability to foster learning.
CONCLUSION
22
REFERENCES
23
ABSTRACT
In todays Digital Age, teaching and learning is becoming dynamic. Technology is used to
create unique teaching and learning experiences. Universities and campuses are moving
towards technology adopted teaching and learning practices. In the global perspective, this
shift is considered as an innovative practice in education. Even though most of the teachers
are shifting themselves to technology adopted teaching, there is a bit concern of adopting
technology. Technology driven education can lead quality in education.Due to technology
adopted teaching practices, teachers role is shifting from the information provider to a
24
mentor or facilitator. This empirical research study is done to understand the attitudeof
teachers towards innovative teaching practices.
1. Introduction:
2. Review of Literature:
Students learn through cognitive and experiential means. From the students perspective,
cognitive learning happens through communication skills, critical learning skills and also
25
problem solving skills. While delivering cognitive skills to students, we need to look into
teaching style of teachers. The focus should be on what students learn and also the learning
outcome. Education accreditation bodies are focusing more on innovation teaching and
impactful engagement of students in the classroom learning. There is a potential impact on
innovation in teaching and student engagement.
Use of the term "innovative" to describe the combination of the three teaching practices
described below is intentional. Student centered pedagogy and extending learning beyond the
classroom are concepts that have very long histories. The term "innovative" in the context of
this research describes combining these practices with technology to solve teaching and
learning challenges in new ways. It is the combination of these pedagogical practices with
technology that has the potential for real innovation (2013, Microsoft Partners in Learning
School Research).
The teachers' attitudes towards change and their readiness to become active partners is
considered a critical success factor (Avidov-Ungar, 2010; Coffman, 2009; Day &Gu, 2007;
Fullan& Smith, 1999). Similarly, resistance to change is considered one of the main reasons
for failure of proc-esses that involve change in organizations in general and in the educational
systems in particular (Fullan& Hargreaves, 1996; Zimmerman, 2006). In the case of
innovative technology implemen-tation in schools, teachers' resistance is reported by some
studies to be the most important factor in the project's success (Del Val & Fuentes, 2003),
mainly because the technology doesn't fit to their pedagogical practices and beliefs
(Halverson & Smith, 2009; Harris & Hofer 2009). Accord-ing to Del Val and Fuentes (2003),
resistance to change is divided into cognitive resistance (fo-cused on identifying and
26
presenting weaknesses of the change and enlisting claims and reasons for maintaining the
existing situation) and emotional resistance (focused on expressing negative feelings towards
the change, such as anger, disdain, hostility or sadness). Emotional resistance is also
accompanied by psychological symptoms such as tension, impatience, pessimism, apathy and
disinterest. In many cases, resistance to change becomes active resistance, in which
participants actively sabotage the process of change (Zimmerman, 2006).
3. Research Objectives
The main objectives if this research is to study the attitude of teachers technology driven
education. When it comes to investigation, two principal research objectives have been
identified and to address the phenomenon under this study, following two objectives provided
to use.
Research Objective 1:To study the factors affecting technology driven education.
Research Objective 2: To analyze the attitude of teachers towards innovative
teaching practices.
4. Research Questions
Research question of this study is derivative from the evidance source of research objectives
established and litrature. To achieve the above objectives, the following research questions
were demonstratedfor this study.
Research Question 1: What are the factors affecting technology driven education?
Research Question 2: What is the attitude of teachers towards innovative teaching
practices?
Research Question 3: What is the most relevant factor affecting technology driven
education?
5. Research Framework
27
Based on the literature presented in this study, the main four variables was chosen and the
following framework was drawn. Framework is consisting of four independent variables
labelled as (1) Technology Driven Education (2) Student Centered Teaching (3) Learning
Beyond Classroom (4) Lifelong Learning. As the study will focus on attitude of teachers,
therefore the dependent variable will be attitude towards innovative teaching practices and
the impact of innovative teaching for students.
28
7. Methodology
Primary data
In this study, mostly secondary data are extracted from online resource such as journal
articles of relevant study field which are adopted from Emerald Library Database, ProQuest
Database and Science Direct database which can be found online library databases. Journal
articles been used in this study are taken from the year of 2000 and up to date.
Target population
According to Hair & Bush (2006), target population is said to be a specified group of people
or object for which questions can be asked or observed made to develop required data
structures and information. Therefore as mentioned earlier the main population will be
teachers currently working at universities from Asia (India, Malaysia, Indonesia, Bangladesh
and Pakistan)and who are teaching graduates and post graduates and obtained degree and
above as their educational qualifications.
29
Sampling selection
As per Malhortra& Peterson (2006) and Zikmund (2009) in order to generate data more
accurately, large number of sampling size should be needed, but in different situation the
sampling size will differ as well. With regard this a sample represents 5% -10% of total
population, 150 questionnaire was distributed among the teachers at university level from
various universities across the world to achieve the response rate of 78%, where 150 sample
was determined using convenience sampling method approved from Krejcie, and Morgan
(2013).
8. Measuring instrument
The research instrument that used by this study is survey questionnaire. The purpose of using
questionnaires survey is because of the direct response and feedback from the respondents
that can be collected in short period of time and in an easier manner ( Chee Hong , et al.,
2012). The questions were selected from four independent variables which were identified as
factor determining attitude of teachers namely, technology driven education, student centric
teaching, learning beyond classroom, and lifelong learning. The questionnaires will be send
to respondents through online and email as per Boustani, (2014) mentioned that this methods
would be easy and faster to reach large number of population within a given period of time.
Table 8.1: Variable & instrument measuring
Research Variables
Items
Satisfied with the technology driven education(TDE1)
There has been a change in education through technology over the
Technology Driven
years (TDE2)
Education
Technology driven education are well structured to help the students
(TDE)
30
Learning Beyond
Classroom
(LBC)
31
(LL)
Innovative Teaching
Practice
(ITP)
32
Healy & Perry (2000), explain that validity determines the measuring instruments ability to
measure what it is supposed to measure. According to Healy & Perry (2000), reliability
indicates the degree of consistency and stability of the items used in measuring instrument.
It is also important that all the sources and information used for the research purpose are
obtained from the reliable sources as well, thus this will increase the credibility of the study.
Firstly, for the purpose of literature review data collection was completed from recognized
platforms that confirm that the evidence collected remained reliable. Therefore most of the
research pares and journals were taken from recognized data bases such as Emerald,
ScienceDirect, and Ebscohost as well as other reliable sources. Additional online information
was taken only from official websites related to government that in common have great
reliability.
Cronbachs Alpha was used in the research to check as a measure of reliability and internal
consistency. They Cronbachs Alpha is a reliability coefficient that indicates how well items
in a set are positively correlated to one another. It measures the inter-correlations among each
items, with a measure of 1 being higher in terms of internal consistency and if the computed
result shows between, 0.70 to 0.95 then it is considered being acceptable (Hair et al., 2011).
9. Data analysis
Summary descriptive statistics will be extracted from responses to the first 4 questions to
determine demographics of the respondents. Data will be then analyzed using various
statistical tools to study the relationship between the independent variable and dependent
variables and other appropriate tools to analyze using the Statistical Package for the Social
33
Sciences (SPSS statistics 22.0) which was also used by Usha & Devanshi, (2013). The
motive of using SPSS is, the software is very much user friendliness, ability to conduct
various statistical techniques (Hom, 2006) that will benefit to achieve the research objectives.
SmartPLS was used to analyze the factor analyze Cronbachs alpha, multiple regression
analysis between talent management (independent) variables towards employee retention
(dependent variable).
Table 9.1: Summary of Demographic Analysis
Measures
Items
Frequency
Percentage
Male
56
33.7%
Female
94
62.7 %
30-30
80
53.3%
40-49
65
43.3%
50-59
3.3%
19
12.7%
1-5 years
73
48.7%
5-10 years
24
16%
19-15 years
30
20%
< 15 years
2.7%
Bachelors Degree
123
82%
Masters Degree
27
18%
Doctorate Degree
0%
Gender
Age Group
Experience
Qualification
When evaluate the internal consistency of the model, the values of CR should be greater than
0.7 and below than 0.9. If any item loading shows below 0.7 and above 0.9 that item should
34
be removed following any values above 0.7 should be considered as reliable (Hair et al.,
2010).
The present study, there are 12 items that are more than 0.7. 14 items were extracted from the
model since the loadings are below 0.7. The Extracted loadings are TDE2 (0.524), TDE4
(0.205), TDE6 (-0.391), SCT1 (0.333), SCT2 (0.476), SCT6 (0.141), LBC3 (0.622), LBC5
(0.271), LBC6 (0.41), LL1 (0.513), LL2 (0.325), LL3 (0.137), and LL8 (0.293).
Below shows factor loadings results. When the sample size is 85 and above, convergent
validity should be done to test and observe whether all the factor loadings are greater than or
above 0.7 (Zikmud, 2007). Since the present study shows the factor loadings of all the
variables are greater than 0.7 and below 0.9 it can be said that the main construct used in the
present study is adequately reliable.
Factor
Items
loadings
0.869
0.732
0.854
0.935
Training
0.889
(SCT)
Student Centric
Classroom
organization (LBC1)
35
0.800
0.848
(LBC)
Lifelong Learning
(LL)
Innovative Teaching
Practice
(ITP)
0.849
0.782
0.722
0.879
0.764
0.807
0.802
0.915
0.971
0.967
0.942
0.947
Convergence Validity
AVE constructs of the present study is higher than 0.6 convergent validity shows the meaning
of all indicators of same construct positively correlate with each other.
Composite
Items
Loading
AVE
TDE1
0.869
0.674
TDE3
0.733
TDE5
0.854
SCT3
0.935
SCT4
0.889
SCT5
0.800
LBC1
0.848
LBC2
0.849
LBC4
0.782
Items
Loading
AVE
LL4
0.722
0.632
LL5
0.879
LL6
0.764
LL7
0.807
ITP1
0.802
Innovative Teaching
ITP2
0.915
Practice
ITP3
0.971
ITP4
0.967
Reliability
Technology Driven
0.860
Education
0.908
0.768
Learning Beyond
0.866
Classroom
Construct
Composite
Reliability
0.872
0.684
Lifelong Learning
0.973
37
0.857
ITP5
0.942
ITP6
0.947
Composite Reliability
There are 5 factors and 32 items tested to achieve the Cronbachs Alpha of the study.
Cronbachs Alpha
Number of Item
Variables
0.846
32
When testing the Cronbach Alpha, all the values should be higher than 0.7 (Babbie, 2001).
He also mention that if the Cronbachs alpha values are more than 0.9 than it is considered as
a very strong value. In the present study the overall Cronbach alpha is 0.846, which is above
0.7, therefore, the construct of all the variables are good and reliable.
Alpha
on Standardized Items
0.836
-0.015
0.967
-0.075
Learning Beyond
0.816
0.010
Factor
Technology Driven
N of Items
Education
Classroom
38
Lifelong Learning
0.762
Innovative Teaching
0.853
-0.195
8
6
Practice
The above tables shows the final Cronbachs Alpha of each individual variables. Cronbachs
Alpha for each independent variable and dependent variable should be more than 0.7 for all
social science studies as per (Saunders, 2007). Reliability for Technology Driven Education
is good and overall Cronbachs alpha is 0.836 (>0.7) and contains six items. Reliability for
Student Centric Teaching is also good and overall Cronbachs alpha is 0.967 (>0.7) and it
contains six items. The reliability for Learning Beyond Classroom is good and overall
Cronbachs alpha is 0.816 (>0.7) which contains six items. The reliability for Lifelong
Learning is also good and overall Cronbachs alpha is 0.762 (>0.7), and it contains eight
items. The reliability for Innovative Teaching Practice is good as well and overall Cronbachs
alpha is shows as 0.853 (>0.7) and contains six items.
As per Bougie&Sekaran (2010) if the Cronbachs Alpha shows above 0.7 and closer to 1, the
internal of reliability of the study is very high. According to Hair et.al (2010) any value above
0.6 will be accepted to check the internal consistency of the model. Since all the values of
this study model shows above 0.7, whole questionnaire is very reliable.
Discriminant Validity
For the purpose of discriminant validity both the cross loadings and square root of AVE
(which is also known as Fornell Lacker) should be tested. Hair at al (2010) mention that
AVE should be greater than the correlations between the constructs. Table 9.6 shows that
square root of AVE is greater than the correlation with other constructs.
39
Variable
1. Learning
Beyond 0.827
Classroom
2. Innovative
Teaching -0.103
0.926
Practice
3. Lifelong Learning
4. Technology
o.428
-0.228
0.795
Driven 0.304
-0.139
0.566
0.821
-0.150
0.385
0.226
Education
5. Student Centric Teaching
0.329
0.876
Furthermore, same time all the indicators loadings under their own constructs should also
have to be greater than other cross loadings with remain constructs (Hair 2010). Table 9.7
shows the satisfied requirements of all cross loading constructs.
Items
LBC
ITP
LL
TDE
SCT
LBC1
0.848
-0.064
0.340
0.271
0.193
LBC2
0.849
-0.102
0.385
0.208
0.413
LBC4
0.782
-0.081
0.326
0.291
0.155
ITP1
-0.077
0.802
-0.103
-0.062
-0.090
40
Tabl 9.
ITP2
-0.064
0.915
-0.132
-0.058
-0.129
ITP3
-0.136
0.971
-0.252
-0.151
-0.172
ITP4
-0.124
-0.967
-0.239
-0.168
-0.131
ITP5
-0.037
0.942
-0.214
-0.127
-0.119
ITP6
-0.109
0.947
-0.249
-0.149
-0.167
LL4
0.106
-0.173
0.722
0.267
0.341
LL5
0.418
-0.247
0.879
0.512
0.196
LL6
0.420
-0.139
0.764
0.553
0.417
LL7
0.519
-0.069
0.807
0.515
0.414
TDE1
0.373
-0.138
0.510
0.869
0.326
TDE3
0.087
-0.086
0.424
0.733
0.154
TDE5
0.230
-0.109
0.453
0.854
0.038
SCT3
0.325
-0.167
0.360
0.183
0.935
SCT4
0.220
-0.122
0.244
0.124
0.889
SCT5
0.331
-0.087
0.445
0.344
0.800
41
multicollinearity. For the present study the VIF shows all the variables are below 5,
representing low multicollinearity and model is valid.
Table 9.8: VIF inner values
Item
ITP
LL
1.757
TDE
1.481
LBC
1.283
SCT
1.221
ITP
As mentioned by Hair (2010) In order to get an accurate results for the hypothesis 5,000
times of bootstrapping should be done to test hypothesis. Therefore, for the purpose of this
study 5,000 times of bootstrapping was done to test hypothesis and to get accurate result.
Table 9.9: Path coefficient
Original
Sample
Sample (O)
Mean (M)
TDE - ITP
0.297
0.326
LL ITP
0.329
LBC ITP
SLT - ITP
Item
Standard
Deviation
T Statistics
P Value
0.124
2.406
0.016
0.282
0.172
1.916
0.055
-0.449
-0.372
0.230
1.957
0.050
0.049
0.052
0.100
0.488
0.626
(STDEV)
42
As summarize in the below table 9.10, three hypothesis namely Student Centric Teaching,
Learning Beyond Classroom, and Lifelong Learning was rejected and only one hypothesis
which is Technology Driven Education was accepted.
Table 9.10: Summary of Hypothesis
Hypotheses
Finding
Conclusion
T value = 2.406
Accepted
P value = 0.016
teaching practice
Signiant at 1% level
T value = 1.916
Rejected
P value = 0.055
Not significant
T value = 1.957
Rejected
P value = 0.050
Not Signiant
T value = 0.488
P value = 0.626
practice
Not Significant
43
Rejected
11. References:
44
Learning
Objects,
6,
259-280.
Retrieved
from
http://www.ijello.org/Volume6/IJELLOv6p259-280Avidov704.pdf
Centers for Disease Control and Prevention. (2010). The association between schoolbased physical activity, including physical education, and academic performance.
Atlanta, GA: U.S. Department of Health and HumanServices. Retrieved from
http://www.cdc.gov/healthyyouth/health and academics/pdf/pa-pe paper.pdf
Del Val, M. P., & Fuentes, C. M. (2003). Resistance to change: A literature review
and empirical study. Management Decision, 41(12), 148-155.
Fullan, M., & Hargreaves, A. (1996). What's worth fighting for in your school? New
York: Teachers Col-lege Press.
Fullan, M., & Smith, G. (1999). Technology and the problem of change. Available at
http://www.michaelfullan.ca/Articles_98-99/12_99.pdf
Halverson, R., & Smith, A. (2009). How new technologies have (and have not)
changed teaching and learn-ing in schools. Journal of Computing in Teacher
Education, 26(2), 49-55.
Harris, J., & Hofer, M. (2009). Instructional planning activity types as vehicles for
curriculum-based TPACK development. In C. D. Maddux (Ed.), Research highlights
in technology and teacher educa-tion 2009. Chesapeake, VA: AACE.
Laura Blythe Liu, Lottie L. Baker & Natalie B. Milman (2014) Technological
innovation in twenty-first century multicultural teacher preparation, Journal for
Mulitcultural Education Vol. 8 No. 1,54-67.
45
Reed, J. A., Einstein, G., Hahn, E., Hooker, S. P., Gross, V. P., &Kravitz, J. (2010).
Examining the impact of integrating physical activity on fluid intelligence and
academic performance in an elementary school setting: A preliminary investigation.
Journal of Physical Activity and Health, 7, 343351.
Campus-Wide
Zimmerman, J. (2006). Why some teachers resist change and what principals can do
about it. NASSP Bulle-tin, 90(3), 238-249.
46
PRATIMA PANDEY
RESEARCH SCHOLAR
CBSMS
BANGALORE UNIVERSITY
Abstract:In contemporary times, the influence of technology has made the world a global village.
Advanced means of communication and transportation has reduced the distance of miles into
few hours/minutes. The advent of computers and internet has its significant impact on every
aspect of society. Today the business world cannot survive without technology. The influence
of technology is seen in all areas of business whether it is marketing, finance, human resource
or production. Human resource is the most significant and precious component of the
organization. This paper tries to explore and study in an empirical way, the impact of
technology on contemporary practices of HR and its role in enhancing the organizational
effectiveness.
Keywords: - Technology, Human resource, Organizational Effectiveness
Introduction
The e- revolution has finally freed HR to focus on strategies to support the company
business- the acquisition, retention and growth of the companys most important assets: its
people and its collective knowledge.- Watson Wyatt, HR consulting firm
Today, the business world is facing a lot of challenges and is undergoing a substantial
change. Organizations are facing the problem of job hopping, job poaching, attrition,
employee turnover etc. The organization which supports the traditional HR functions fails to
catch up with the dynamic changes happening in the environment. They are lagging behind in
collecting employee information, monitoring individual performance and implementing
organizational policies. There is constant pressure on HR to adapt itself swiftly with the
environment.
to assess
the
Compensation: - Compensation and benefits has undergone a sea change in the past few
years. The technology has its profound impact on the compensation and benefits
administration. Compensation plan should be at or above market level, including stock
options; quality of life with flexible work time and more vacation time; opportunities for
personal development and skill development; performance and skill based incentives.
Presently the compensation benefits available are more of a self-service operation on the
companys website. General Motors has their online HR portal called the Employee Service
Centre. Employees can flexibly administer their own benefits within company guidelines.
The other advantages of integrating technological tools in compensation are, it provides
greater access to relevant information about compensation benefits; employees can look at
salary.com and compare how their organizations are paying in comparison to others;
employees are becoming more educated in stock options and 401k plans.
Retention:- Retention of critical talent is prudent for organizations survival, long term
profitability and growth. Organizations are employing a plethora of techno savvy techniques
to meet this challenge. The techniques used to find out why the employees stay or leave the
organization are employee opinion surveys and exit interviews. The opinion surveys help in
knowing the mind-set of the employees. The exit interviews often help organizations to better
understand the rationale of employee turnover. Most of the organizations are emphasising on
the importance of culture. They are also making it sure that employees have thebest tools
todo their job effectively. Because of intense competition it is a daunting task for
organizations to retain the critical talent.
Human Resource Information System(HRIS):-HRIS can briefly defined as integrated systems
used to gather, store and analyse information regarding organizations human resources. It
refers to the system and processes at the intersection of HRM and information technology. It
is an information system that provides a single centralized view of data that a human resource
management require for completing HR processes.
HRIS helps in implementing and administering the organization compensation policies. It
provides statistical summaries and special reports involving pay grade, performance data, pay
roll information and other employee records. HRIS is integrated with payroll system of the
organization to prepare bonuses, benefits and maintaining payroll records.
Application tracking system is also known as candidate management system. It is a software
application designed to help an enterprise recruit employees more efficiently. It can be used
to post job openings on a corporate website or job board, screen resumes and generate
49
interview requests to potential candidates by email. It also helps in customized input forms,
pre-screening questions response tracking and multilingual capabilities.
HRIS helps in HR professionals to comply with regulations and can also make the process of
compiling information and reports much less painful and time consuming. It helps
the
organization to provide updated information about requirement; makes paper work easier;
helps in wage and hour laws compliance; allows better compliance oversight and mitigate
errors that may result in non-compliance.
Providing benefitrelated information and processing
organization manually is a difficult task. HRIS helps in simplifying the complex process with
accurate calculations; no matter how many times employee changes his benefit choices
throughout the year.
Organizational Effectiveness: - It is the concept of how effective an organization is in
achieving the outcomes the organization intends to produce. It is the ability of an
organization to account successfully for its output and operations to its various internal and
external constituencies.
Review of Literature
Traditional HR functions were limited to recruitment, selection, training & development,
performance management etc. Early systems were narrow in scope and typically focussed on
a single
The intervention of technology has brought tremendous changes in the field of HR.
50
information technology in human resource. The findings suggest that use of technology can
reduce routine work and allow better information communication and autonomy, which leads
to fundamental change in the functioning of HR.
Hussainetal(2006) , have discussed the use of technology in different size of companies.
The application of technology can enhance the strategy partner role of HR professionals. The
51
researchers also noted that application of technology can provide value added services and
raise the status of not only HR but of organization as a whole.
Haines and Lafleur(2008) examines
the influence of
effectiveness of the HR function. The results reveal that the frequent use of technology in
human resource applications result into the increased involvement of HR in
the strategic
role of organization.
Rueletal(2008), has opined
processes in an effective manner with the improved technology and this will help the HR
to play a strategic role in attaining enhanced competitive advantage.
Adewoye (2012),has mentioned that the interaction and intersection between
technology
and HRM leads to emergence of human resource information system. It merged all HRM
activities and processes with technology which provides strategic, flexible, cost efficient and
customer oriented services.
Research Methodology
The study is descriptive and empirical in nature. It is based on primary data collected from
various sample of the organizations. The research is quantitative in approach. Primary data
has been collected through structured questionnaire. The questionnaire was close ended and
is based on Likert five point scale. Secondary data has been collected through journals, books
etc. Ten leading IT companies have been selected for study. These companies are listed in
NASSCOM. The selection of these companies have been based on convenience sampling,
although certain criteria to select the companies like the number of years in operation(i.e.
min. of 10 years) and number of employees(i.e. min. of 1000) employees has been used. The
questionnaire was self-administered to the HR executives to give their feedback.
Objectives
1) To assess the impact of technological tools used for procurement of employees on
organizational effectiveness.
2) To evaluate the impact of technological tools used for the development of employees on
organizational effectiveness.
3) To find out the impact of technological tools used for retention of employees on
organizational effectiveness.
Hypotheses
H01= There is no significant relationship between technological tools used for procurement of
employees and organizational effectiveness.
52
Adjusted
Square
Square
the R
Estimate
F Change
df1
df2
Square
Sig.
Change
Change
.925a .856
.852
.19367
.856
225.909
38
.000
a. Predictors: (Constant), AV of F
This table provides the value of R and R square. The R value represents the simple
correlation and is 0.925, which indicates a high degree of correlation.
indicates how much of total variation in the dependent variable, technological tools for
procurement of employees, is explained by independent variable, organizational
effectiveness. In this case it is 85.6%.
ANOVA
Model
Sum
of df
Mean Square
Sig.
225.909 .000b
Squares
Regression 8.473
8.473
Residual
38
.038
1
1.425
53
Total
9.898
39
a. Dependent Variable: AV of A
b. Predictors: (Constant), AV of F
The above table is ANOVA, which reports how well the regression equation fits the data (i.e.
predicts the dependent variable). This table indicates that the regression model predicts the
dependent variable significantly well. The F ratio tests whether the overall regression model is a
good fit for the data. The tableshows that the independent variable statistically and significantly
predicts the dependent variable (1, 38) =225.909, p<0.0005(i.e. the regression model is a good fit
for the data.
This proves the first alternative hypothesis that there is a significant relationship between
technological tools used for procurement of employees and organizational effectiveness.
Adjusted
Std.
Change Statistics
Square
R Square
Error R
Square F Change
df1
df2
of the Change
Sig.
Change
Estim
ate
.961
.924
.922
.1577
5
.924
464.051
38
.000
a. Predictors: (Constant), V5
This table provides the value of R and R square. The R value represents the simple correlation and is
0.961, which indicates a high degree of correlation. The R square value indicates how much of total
variation in the dependent variable, technological tools for development of employees, is explained
by independent variable, organizational effectiveness. In this case it is 92.4%.
ANOVA
54
Model
Sum
of df
Mean Square
Sig.
464.051
.000b
Squares
Regression 11.548
11.548
Residual
.946
38
.025
Total
12.494
39
a. Dependent Variable: V4
b. Predictors: (Constant), V5
The above table is ANOVA, which reports how well the regression equation fits the data
(i.e. predicts the dependent variable). This table indicates that the regression model predicts
the dependent variable significantly well. The F ratio tests whether the overall regression
model is a good fit for the data. The table shows that the independent variable statistically
and significantly predicts the dependent variable (1, 38) =464.051, p<0.0005(i.e. the
regression model is a good fit for the data.
This proves the second alternative hypothesis that there is a significant relationship between
technological tools used for development of employees and organizational effectiveness.
55
c)Relationship between technological tools used for retention of employees and organizational
effectiveness
Model Summary
Model R
R Square
Adjusted
Std.
R Square
of
Estimate
F Change df1
df2
Square
Sig.
Change
Chang
e
.973
.946
.945
.1785317
.946
669.412
38
.000
This table provides the value of R and R square. The R value represents the simple correlation and
is 0.973, which indicates a high degree of correlation. The R square value indicates how much of
total variation in the dependent variable, technological tools for retention of employees, is explained
by independent variable, organizational effectiveness. In this case it is 94.6%.
ANOVA
Model
Sum
of df
Mean Square
Sig.
669.412
.000b
Squares
Regression 21.337
21.337
Residual
1.211
38
.032
Total
22.548
39
56
The above table is ANOVA, which reports how well the regression equation fits the data (i.e.
predicts the dependent variable). This table indicates that the regression model predicts the
dependent variable significantly well. The F ratio tests whether the overall regression model is a
good fit for the data. The table shows that the independent variable statistically and significantly
predicts the dependent variable (1, 38) =669.412, p<0.0005(i.e. the regression model is a good fit
for the data.
This proves the third hypotheses that there is a significant relationship between technological tools
used for retention of employees and organizational effectiveness.
Suggestions
1) For procurement of employees it can be suggested that organizations examine the
benchmark in their industry and their use of electronic resumes. The organizations
together with their HR professionals should search out on line resources and databases
for hard to fill positions or categories of employees.
2) For developing human resources, organizations should consider assessing the strategic
and training needs of the employees. HR managers should work with employees to
search out online career tools and use this as a tool of retention.
3) In terms of compensation and benefits, organizations must realize
that
due to
advent of technology employees are more knowledgeable than ever before and it is
prudent to monitor market trends in terms of pay and compensation.
4) Organizations should emphasize on employee retention through variety of strategies
like supporting work-life balance, cultivating a corporate culture which focuses on
employee development, offer options like telecommuting and flexible schedules.
5) There is a need for more direct tangible accountability for developing employees,
leaders and managers, but this accountability needs to work both ways. Organizations
must provide the training and support managers need, tobuild their management skills
and capabilities.
Conclusion
57
58
DR.M.MUNINARAYANAPPA
PROFESSOR, DEPARTMENT OF COMMERCE, BANGALORE UNIVERSITY,
KOMALA.G
Abstract:
The paper is conceptual in nature discuss how Private Equity and Venture Capital
investments focus in consumer technology based on the India Private Equity Report.
Consumer technology sector includes companies focused on e-commerce, social
connectivity, content generation and sharing, wearable technology and enabler companies
which aid the operating models of others in the sector. The reasons for attracting investments
in consumer technology are; 1) Increasing internet penetration translates to rapid growth in
online transactions. 2) As both working population and household incomes rise, Indias
demand for technology-enabled services is expected to rise sharply. 3) Consumer technology
was the most attractive sector for PE/VCs in 2014, deal values and volumes grew by 137%
and 71%, respectively compared with 2010. 4) The promise of high growth translated into
investment in 2014, as $4.7 billion was invested into the sector. 5) Average deal size in the
sector was approximately $ 17 million, a threefold increase over 2013. More than 30% of
funds expect deal size of >$50 million in coming years. 6) Consumer technology focused
companies experienced a rapid rise in valuations in 2014. Overly 70% of survey respondents
expect valuations to continue to rise. To study conclude both PEs and VCs compete to
invest. Attractive valuations, fund network and sector expertise are the most critical factors
that promoters consider when seeking PE/VC funding.
59
Introduction
The Indian stock market gave phenomenal returns of more than 30% over the year, compared
with less than 10% in 2013. Backed by the stronger macroeconomic landscape, PE activity
continued to play a pivotal role in the countrys capital needs, accounting for 53% of foreign
direct investment inflows. According to CEIC data, Indias GDP grew by 6.6% from 2013 to
2014, compared with 4.9% from 2012 to 2013. The services sector experienced particularly
strong growth, and its contribution to GDP climbed to 51% in 2014. Notably, trade, hotels,
transport, communication and related services grew by nearly 11%, leading the sectors
overall growth. PE investments in India saw a robust increase over 2013. Deal value,
including real estate, infrastructure and venture capital deals, increased by 28% to 15.2
billion.
Overall deal value in India grew by 14%, with early-and growth-stage deals
accounting for 80% of total deals in 2014. The consumer technology sector led in both deal
value and volume, constituting 31% of overall deal value and 35% of overall deal volume.
In terms of attracting foreign investments, India continues to face competition from other
emerging economies with prospects for strong growth, including South Africa and Nigeria.
India boasts strong GDP growth, a vibrant entrepreneurship ecosystem and a positive future
outlook, making it one of the most attractive of the emerging economies for PE investments
in 2015.
PE and VC investments in Consumer Technology
The consumer technology sector encompasses multiple segments.
E-commerce-which
includes e-tailers Flipkat and Snapdeal, online travel companies, as well as taxi and other
providers who channel services via mobile phone and internet-accounted for a significant
chunk of investments in the sector in 2014. Social connectivity services represented the
second-largest segment. Becoming increasingly popular on a daily basis, Facebook, Twitter,
LinkedIn and similar services, along with online classifieds, all fall into this bucket. Contentgenerating and sharing companies, including entertainment and data generating companies,
are also a part of the consumer technology sector. The new but fast-growing wearable
technology segment, which includes smart access devices and fitness devices, also falls in the
consumer technology sector.
functioning of a part of the operating model for other companies in this space; examples
include provides of payment media, e/m-advertisers, application developers, analytics
services and logistics and delivery services.
60
Consumer technology was the largest sector in terms of PE and VC investments in 2014,
contributing approximately 31% to overall deal value and accounting for approximately 35%
of overall deal volume. Investments in the sector almost quadrupled over the past year, from
$4.7 billion, and the number of deals grew by 18% to 280. Average deal size full from $5
million to $17 million.
Review of Literature
Jaun (1986) this study reports on the exploratory phase of a research project on prefunding
factors influencing the success of high-technology start up companies. Findings of this
research revealed discernible differences between successful and unsuccessful firms. Both
successful and unsuccessful ventures targeted high growth markets, anticipated high gross
margins had founders with over five years of relevant experience, had experienced venture
capitalists on their boards, and were characterized by a wide range of founder equity shares.
William (1987) study the factors that influence the amount of networking are the
innovativeness, technology, stage and industry of the portfolio company.
Florida and Kenny (1988) explores the role of venture capital in technological innovation
and regional development stating the existence of well developed venture capital networks in
technology based regions significantly accelerates the pace of technological innovation and
economic development in California, New York and New England.
Gompers (1995) venture capitalists concentrate investments in early stage and high
technology companies where informational asymmetric are highest.
Hurry (1992) the strategic logic of Japanese high-technology venture capital investments
reveals the existence of an implicit call option, or shadow option, on new technology.
Objective
1. To study the Private Equity and Venture Capital Investment in Consumer Technology
in India.
Scope of the Study
This study is conducted on the basis of prior data relating India Private Equity Report 2015.
Research Methodology
Type of Study - Empirical
Type of Data - Secondary
61
The study is based on the technical analysis, previous data relating to India Private Equity
Report 2015. The information so taken is compiled through tabulation and shown in graphs
Results and Discussion
Fig.1 Consumer Technology space can be divided into five broad segments
62
The number of internet users in India has reached 354 million by the end of June 2015. The
latest figure indicates that India has more internet users than the population of the US and
become the second largest country by the number of internet users after china according to
the report published by the Internet And Mobile Association of India (IAMAI).
Fig.3. Rapidly rising working population with higher spending power is fuelling the demand
for technology-enabled services.
Fig.4. In 2014, consumer technology emerged as the most attractive sector for PE and VC
investments, with the most deals and highest deal value across sectors.
Fig.5. Most funds expect growth to continue for the next two to three years, but funds also
see potential challenges in high current valuations and average operations.
63
Fig.6. Investments in consumer technology quadrupled to $ 4.7 billion in 2014, with ecommerce and connectivity growing most.
Fig.7. Average deal size for consumer technology tripled in 2014, mostly as a result of a few
large deals.
64
Fig.8. Funds believe consumer technology entrepreneurs consider valuations, the funds
network and sector expertise to be the most important criteria for selecting a partner.
Fig.9. Valuations in consumer technology grew rapidly in 2014; most GPs perceive that
consumer technology valuations are high and expect them in increase slightly.
65
Fig.10. Given positive forecasts for 2015 growth, the investment outlook for consumer
technology in the medium term is strong and positive.
Conclusion
Consumer technology was the most attractive sector for PE/VCs in 2014, by attracting $4.7
billion into the sector. Increasing internet penetration translates to rapid growth in online
transactions. Average deal size in the sector was approximately $17 million, a threefold
increase over 2013. More than 30% of funds expect deal sizes of >$50 million in coming
years. Consumer technology-focused companies experienced to rapid rise in valuations in
2014. Nearly 70% of survey respondents expect valuations to continue to rise, despite
66
perceiving them to be overvalued already. Both PEs and VCs compete to invest. While
early-stage deals account for most of the investment to date, growth-stage deals increased
significantly in 2014. Attractive valuations, fund network and sector expertise are the most
critical factors that promoters consider when seeking PE funding. Funds expect strong
growth in the next three to five years. They expect to increase their funding in 2015 and
beyond.
Bibliography
1. Timmons, J. A., & Bygrave, W. D. (1986). Venture capital's role in financing
innovation for economic growth. Journal of Business venturing, 1(2), 161-176.
2. Davila, A., Foster, G., & Gupta, M. (2003). Venture capital financing and the growth
of startup firms. Journal of business venturing, 18(6), 689-708.
3. Gompers, P. A. (1995). Optimal investment, monitoring, and the staging of venture
capital. Journal of finance, 1461-1489.
4. Bottazzi, L., & Da Rin, M. (2002). Venture capital in Europe and the financing of
innovative companies. Economic Policy, 17(34), 229-270.
5. Camp, S. M., & Sexton, D. L. (1992). Trends in venture capital investment:
implications for high-technology firms. Journal of Small Business Management,30(3),
11.
6. Hurry, D., Miller, A. T., & Bowman, E. H. (1992). Calls on hightechnology:
Japanese exploration of venture capital investments in the United States. Strategic
Management Journal, 13(2), 85-101.
7. Florida, R. L., & Kenney, M. (1988). Venture Capital, High Technology and Regional
Development. Regional Studies, 22(1), 33-48.
8. Roure, J. B., & Maidique, M. A. (1986). Linking prefunding factors and hightechnology
venture
success:
An
exploratory
67
study. Journal
of
Business
DR. S. MANIKANDAN
ASSISTANT PROFESSOR, THE INSTITUTE OF COMPANY SECRETARIES OF
INDIA, MUMBAI.
Introduction
Various segments of industrial sector contribute their role for industrial development in India.
Among the various industries, Cotton Textile industry plays a predominant role. Textile
industry is the oldest industrial sector of the country. It has the single largest weight in the
index of industrial production. It is the second largest provider of employment after
agriculture. It contributes about 14% to the industrial production, 4% to the GDP and 11% to
the countrys export earnings. The Textile Industry in India was divided into Mill sector,
Powerloom and Handloom sectors. The latter two are jointly considered under the heading
Decentralized Sector. Powerloom sector plays a major role in the country.
Powerloom means a loom which is worked by power usually in the range of 0.75 to 1.00
horse power. Powerloom industry occupies an important place in Production, Employment
and Export.At the time of introduction of the new textile policy in 2000 the powerloom sector
increased to 16, 55,369 and it has further increased to 17, 00,000 units in the recent years.
There were approximately 5.24 lakh powerloom units with 23.24 lakh powerlooms as on 30th
September 2012. The Decentralized Powerloom Sector is one of the most important segments
of the textiles industry in terms of fabric production and employment generation. It provides
employment to 57.44 lakh persons and contributes 62 percent to total cloth production in the
country. There are approximately 1,05,000 shuttleless looms in this sector. It is estimated that
more than 75% of the shuttle looms are obsolete and outdated for more than 15 years.
Review of Literature
68
Textile industry is one of the industries in India, which has been functioning for many
centuries and it has undergone many structural shifts over the years. It is the source of
livelihood for lakhs and lakhs of weavers, workers and also those who are dependent on this
industry indirectly. As noted earlier, it is next only to agriculture in its vastness, social
importance and economic significance especially to the vulnerable and marginalised sections
of the society. Many attempts have been made by various scholars to examine various aspects
of the Indian textile industry in general and that of the power loom industry in particular.
Hatti traces the study of the Indian textile industry down through the colonial rule to the
present set up. In a country of Indias size and population, this unorganized sector assumes
importance in employment generation, balanced regional development, and contribution to
national exchequer.
Ashrat1 observes that the textile industry occupies a predominant place in the Indian economy
by contributing about 23.5 per cent of the countrys industrial production. Apart from
clothing the million, the textile industry also accounts for 25 per cent of the countrys foreign
exchange earnings. He opines that both the government and the trade union have to engage a
conciliatory strategy to save the textile industry.
Geholt2 explains that the special value advance license scheme was introduced to improve the
performance of exporters, and also government decided to increase the permissible level of
investment in the garments sector from Rs. 75 lakhs to Rs. 3 crores with corresponding
increase in the export obligation from 30 per cent to 50 per cent with record to the secondary
machinery.
Karthikyan 3 notes that the textile industry contributed approximately Rs. 12,850 crores to
foreign exchange. The textile industry has transformed from a labour intensive technology to
capital intensive technology. Pakistan and India, the traditional textile countries, also showed
huge investments during the period 1981-91, as Pakistan increased its spindles capacity by 22
per cent from 22.5 million spindles to 27.4 million spindles.
1ASHART,
Hudsin S., (1992), Textile Industry and its performance, Southern Economist, 15th June,
12-14.
2GEHOLT,
3
Ashok, (1993), Towards a New trust to Textile Export, Yojana, 31st March, pp. 6-9.
KARTHIKEYAN, P., (1994), Growth of Textile Industry The TextileIindustry and Trade Journal,
September-October, pp. 34-39.
69
pp.
Ravindran4 is of the view that the powerloom industry is weak in India. Hence most of the
developed countries have been purchasing grey fabrics and they process in their country,
which affects the value addition benefit. Thus, technological modernisation is necessary in
India. He also states that in quantity terms, there will be an increase in export from 4,500
million sq.mt of cloth in 1996 to 12,000 million sq.mt in 2015.
Bhavani and Tendulkar 5 point out that the Indian labour policies are cited by Indian
companies as a principal constraint on firm size, industry investment, and international
competitiveness. These policies include minimum-wage requirements and rules that prevent
firms larger than 100 employees from laying off workers. Because of these policies, a number
of public- and private-sector composite mills that have not operated since the 1980s are still
obligated to financially support the workers they employed. As a result, it is not uncommon
for larger firms to organize into small-scale units for the purpose of avoiding labour
regulations. Although private industry has tried repeatedly to change these policies, primarily
by raising the employment level at which the regulations apply, labour reforms have proven
politically difficult to achieve. The current government has proposed that state governments
be permitted to substantially ease labour regulations for firms operating in export zones, but
this controversial legislation are still pending.
Mahesh 6 opines that due to the elimination of quota structure, Indian textile industry is
booming rapidly, but it is not possible to meet the demand due to low capital investment,
inadequate infrastructure, small scale operation, low production capacities, more stringent
quality polices posed by buyers, obsolete technology and low level of consciousness. He
suggests that to overcome these hurdles, the textile companies have to change their
management strategy like consolidation of small scale operation, expansion of production
capacity, and import of techniques and advanced capital equipment.
There is an increasing trend towards globalisation. Almost every sector of business is
influenced by global forces due to globalisation. In the global business, materials and
4
RAVIANDRAN, R., (2000), Service of powerloom sector, The Textile Industry and Trade
Journal,
Vol.12, No. 3, pp. 24-29.
5
BHAVANI, T.A., and Suresh D. TENDULKAR,(2001), Determinants of Firm-Level Export Performance: A Case
Study of Indian Textile Garments and Apparel Industry, The Journal of International Trade and Economic
Development,Vol. 10, No. 1, pp. 65-92.
6
MAHESH, K., (2005), Profit maximization through laboratory equipment, The Textile Industry
Trade Journal, June, pp. 38-47.
70
and
components are sourced worldwide, manufactured offshore and sold in many different
countries, often with local customisation. The challenge for the global company then, is to
achieve the cost advantage of standardisation, while still catering for the local demand for
variety. This has given rise to intense competition blurring the boundaries between domestic
and global markets.7
Despite being an important activity, powerloom units are not a homogeneous group with
respect to income earned by them. Powerloom units fall into 3 distinct categories 12 per cent
in High income, 36 per cent low income and the remaining 52 per cent in middle income).
The low income units have not been able to upgrade quickly to the higher income brackets,
but have been leaving powerloom weaving altogether.8
Objectives of the Study
1. To examine the structure of the textile industry in general and that of the powerloom
sector in India &Tamil Nadu level;
2. To study about the past and present development in technology under powerloom
sector;
3. To examine the problems of technology, power, and export faced by the sample
powerloom owners in the study area.
4. To know about the future plan of Sample Powerloom Owners.
Hypotheses of the study
1. Idle capacity is scale neutral among the sample powerloom owners.
2. There is a significant relationship between the size of investment and labour
productivity among the sample powerloom owners.
Research Methodology
In Tamil Nadu, powerloom activity is carried out in districts like Coimbatore, Erode, Salem,
Tiruppur, Karur, Madurai and Chennai, in which Erode is quite popular for the powerloom
industry and stands next only to Coimbatore and Tiruppur in the quantum of production. In
Erode district, powerlooms are operated in all the seven taluks viz., Erode, Perundurai,
7
Survey
MOORTHY, A., (2007), Problems of the Powerloom Units in Tamil Nadu, Economic and
Weekly, Vol. XIIL, No. 2, pp. 119-126.
71
of
Political
devices / attachments. However, there has been significant up-gradation in the technology
level of the powerloom sector during the last 7 to 8 years.
Table 1.1- Growth of Powerloom Industry Since 2006
Year
No. of Powerlooms
Growth Percentage
2006-2007
19,90,308
---
2007-2008
21,06,370
5.08%
2008-2009
22,05,352
4.70%
2009-2010
22,46,474
1.90%
2010-2011
22,82,744
1.61%
2011-2012
22,98,377
0.68%
2012-2013
23,47,249
2.08%
2013-2014
23,67,594
0.86%
24,34,717
2.74%
73
The growth of the powerloom sector in Tamil Nadu has been very spectacular registering
over a period of time. The history of powerloom industry start in Tamil Nadu during 1928
where the factory with six looms was started at Madurai. In 1933, a powerloom unit was
started in Komarapalayam of Salem District for making tapes and wicks. The Fact- Finding
Committee of 1941 observed that there were few hundred of powerloom scattered over the
Madras Province. After the independence during the first plan period there were around 1519
powerloom of which 650 were on cotton. After the new textile policy in 1985 and new
economic reform policy the powerloom in Tamil Nadu was increased to 2, 27,500 in 1993
and it has further increased to 4,00,000 of which 3.20 looms are registered powerlooms and
remaining 80,000 looms are un-registered looms. In Tamil Nadu, the powerloom weavers cooperative societies, were working for the promotion of the weavers working in the
powerloom industry and also in the production process. There are 142 Powerloom Weavers
Cooperative Societies covering 24,000 looms. The annual turnover of these societies is
around Rs.20.00 Crore.In 2006-07 there are 4.50 lakh Powerlooms in Tamil Nadu, providing
employment to about 9.14 lakh workers. Out of this, 32,087 Powerlooms are under
cooperative sector. These societies are capable of producing all types of Grey bleached dyed
gadas, printed sarees, lunghies, bed sheets, furnishings, pillow covers, blended dhothies and
sarees etc. Most of the power loom units are concentrated in semi urban or rural area. Among
all, Maharashtra has highest number of powerlooms amounting to approximately 12.8 lakhs
of powerloom, Tamilnadu is second with 86,740 units with 4,43,983 looms , and Gujarat
ranks third with 3.2 lakhs worth of powerlooms.
DAS, S.K., (2001),The Warp and the Woof: An Enquiry into the Handloom Industry in West
Bengal,K.P.Bagchi and Company, Kolkata, pp. 112-128.
10
RANGA N.G.,(1972),The Handloom Weaving Industry, Abhijeet publishers, Bombay, pp. 61-86.
75
GOVERNMENT OF INDIA, (2010), Annual Report 2009-10, Ministry of Textiles, New Delhi,
pp. 119-121.
76
Erode
Perundurai
Total
Single Owned
Household Owned
252
16
268
(94.0)
(6.0)
(100.0)
[59.7]
[42.1]
[58.3]
170
22
192
(88.5)
(11.5)
(100.0)
[40.3]
[57.9]
[41.7]
422
38
460
(91.7)
(8.3)
(100.0)
Total
12
77
[100.0]
[100.0]
[100.0]
Note: Figures in round brackets are row-wise percentages and those in square brackets
are
column-wise percentages.
Source: Field survey.
The table reveals that among the 460 sample powerloom owners, 268 (58.3 per cent)
reside in Erode taluk and 192 (41.7 per cent) reside in Perundurai taluk. Pattern of ownershipwise, among the 460 sample units, 422 (91.7 per cent) are single owned and the remaining 38
(8.3 per cent) are owned by the concerned household as a whole. Area-wise, among the 268
units in Erode, 252 (94 per cent) are single owned and 16 (6 per cent) are owned by the
household, while out of the 192 units in Perundurai, 170 (88.5 per cent) are single owned and
22 (11.5 per cent) are household owned. This indicates that overall, around 92 per cent of the
units are single owned, while the proportion is marginally higher in Erode (94 per cent) than
in Perundurai (88.5 per cent), whereas, the proportion of household owned units is higher in
Perundurai (11.5 per cent) than in Erode (6 per cent).
YEARS OF OPERATION
Table 1.3 presents the area-wise number of years of operation of the sample units. It
is observed from the table that out of the 460 sample units, 52 (11.3 per cent) are operating
for the last 10 years, 135 (29.3 per cent) are existing for 11-15 years, 205 (44.6 per cent) are
functioning for 16-25 years and 68 (14.8 per cent) are operating for above 25 years. Areawise, among the 268 units in Erode, 38 (14.2 per cent) are functioning for upto 10 years, 86
(32.1 per cent) are existing for 11-15 years, 112 (41.8 per cent) are operating for 16-25 years
and 32 (11.9 per cent) are operating for above 25 years. Out of the 192 units in Perundurai,
14 (7.3 per cent) are operating for upto 10 years, 49 (25.5 per cent) are existing for 11-15
years, 93 (48.4 per cent) are operating for 16-25 years and 36 (18.8 per cent) are operating for
above 25 years. Thus, the areaTable 1.3 Number of Years of Operation of the Sample Units
Years
Erode
Perundurai
78
Total
Upto 10 Years
11-15 Years
16-25 Years
Above 25 Years
Total
38
14
52
(73.1)
(26.9)
(100.0)
[14.2]
[7.3]
[11.3]
86
49
135
(63.7)
(36.3)
(100.0)
[32.1]
[25.5]
[29.3]
112
93
205
(54.6)
(45.4)
(100.0)
[41.8]
[48.4]
[44.6]
32
36
68
(47.1)
(52.9)
(100.0)
[11.9]
[18.8]
[14.8]
268
192
460
(58.3)
(41.7)
(100.0)
[100.0]
[100.0]
[100.0]
Note: Figures in round brackets are row-wise percentages and those in square brackets
are
column-wise percentages.
Source: Field survey.
wise number of years of operation of the sample units indicates that the proportion of units
which are in operation for upto 15 years is higher in Erode (46.3 per cent) than in Perundurai
(32.8 per cent), while the proportion of units which are in operation for more than 15 years is
higher in Perundurai (67.2 per cent) than in Erode (53.7 per cent). This suggests that the
sample units in Perundurai are relatively older than that of in Erode.
TYPE OF PRODUCT
79
The sample powerloom units manufacture different types of products which include
dhoties, mulls, voils, sarees, sheetings, drills, long cloth, grey gada and bed sheets. Most of
the sample owners obviously, produce more than one product in the pursuit of diversification,
enlarging sales volume, lessening market risk and maximising profit. Table 1.4 presents the
data pertaining to the type of products manufactured by the sample owners.
Table 1.4 Type of Product Manufactured by the Sample Units
Percent
No
424
92.2
36
Mulls
28
6.1
Voils
12
Sarees
Type of Product
Yes
Percent
Total
Percent
7.8
460
100
432
93.9
460
100
2.6
448
97.4
460
100
287
62.4
173
37.6
460
100
Sheetings
56
12.2
404
87.8
460
100
Drills
18
3.9
442
96.1
460
100
178
38.7
282
61.3
460
100
Long Cloth
67
14.6
393
85.4
460
100
Grey Gada
460
100.0
Nil
Nil
460
100
Bed Sheets
204
44.3
256
55.7
460
100
Dhoties
Shirtings
80
TECHNOLOGY PROBLEMS
Power loom owners face a severe problem in the technology area, since the level of
technology they adopt is quite obsolete, which results in low quantity of output, low quality
of the product, higher cost of operation, higher price of the output, reduced sales and lack of
ability to compete in the international market. Table 1.5 presents the opinions of the sample
respondents about the suitability of the present technology they adopt.
Table 1.5 Suitability of Present Technology in the Sample Units of the Study Area
Opinions
Yes
No
Total
Erode
Perundurai
Total
67
43
110
(60.9)
(39.1)
(100.0)
[25.0]
[22.4]
[23.9]
201
149
350
(57.4)
(42.6)
(100.0)
[75.0]
[77.6]
[76.1]
268
192
460
(58.3)
(41.7)
(100.0)
[100.0]
[100.0]
[100.0]
Note: Figures in round brackets are row-wise percentages and those in square brackets
are
column-wise percentages.
Source: Field survey.
It is noted from the table that out of the 460 sample respondents, only 110 respondents
(23.9 per cent) accept that the present technology that they adopt is suitable to the industry,
while as many as 350 respondents (76.1 per cent) do not accept with that view. Area-wise,
out of the 268 respondents in Erode, 201 (75 per cent) do not accept the view that the present
technology is suitable, while out of the 192 respondents in Perundurai, 149 (77.6 per cent)
81
sample owners come under this category. This indicates that more than three-fourths of the
sample owners do not accept about the suitability of the present technology in the industry.
Table 1.6 presents the area-wise ranks for the different natures of technology to be
used in the industry among those who did not accept the suitability of the present technology.
Table 1.6 Nature of Technology Used in the Industry in the Study Area
Ranks
Nature
Sample Units
Total
One
Two
Three
Four
98
71
21
11
201
(48.8)
(35.3)
(10.4)
(5.5)
(100.0)
67
51
18
13
149
(45.0)
(34.2)
(12.1)
(8.7)
(100.0)
88
81
18
14
201
(43.8)
(40.3)
(9.0)
(7.0)
(100.0)
51
56
25
17
149
(34.2)
(37.6)
(16.8)
(11.4)
(100.0)
54
43
61
43
201
(26.9)
(21.4)
(30.3)
(21.4)
(100.0)
23
21
54
51
149
(15.4)
(14.1)
(36.2)
(34.2)
(100.0)
101
61
27
12
201
(50.2)
(30.3)
(13.4)
(6.0)
(100.0)
78
37
21
13
149
(52.3)
(24.8)
(14.1)
(8.7)
(100.0)
Erode
Import Modern
Looms
Perundurai
Erode
Introduction of
Modern Looms
Perundurai
Erode
Foreign
Collaboration
Perundurai
Erode
Training
Programme
Perundurai
The table portrays that among the 201 respondents in Erode, 169 (84.1 per cent)
agree that import of modern looms is the first or second important measure to be used in the
industry; another 169 respondents accept that introduction of modern looms is essential, 97
respondents (48.3 per cent) agree that establishing powerlooms with foreign collaboration as
the first or second important measure in the technology front and 162 respondents (80.5 per
cent) accept frequent training programmes to different weaving units is the first or second
important measure. In the case of the 149 respondents in Perundurai, 118 (79.2 per cent)
agree that import of modern looms is the first or second important measure to be adopted in
the industry; 107 respondents (71.8 per cent) accept that introduction of modern looms is
essential, 44 respondents (29.2 per cent) agree that establishing powerlooms with foreign
collaboration as the first or second important measure in the technology front and 115
respondents (77.1 per cent) accept frequent training programmes to different weaving units is
the first or second important measure. This implies that more than 80 per cent of the
respondents in both areas agree that importing of modern looms along with sufficient training
programmes to the workers are needed in the industry to improve the level of technology.
All the sample respondents have also been asked to suggest measures to avail the
suitable technology, which are presented in Table 1.7 .The table shows that out of the 460
sample respondents, 200 respondents (43.5 per cent) opine that providing modern
technological training as the first or second important measure in availing the suitable
technology; 267 respondents (58.1 per cent) suggest that maintaining of international quality
as the first or second important measure in availing the suitable technology; 293 respondents
(63.7 per cent) suggest that feasible customs duty for importing looms as the first or second
important measure in attaining the necessary
Table 1.7 Opinions in Using Suitable Technology by the Sample Units
Ranks
Opinions
Modern
Total
One
Two
Three
Four
Five
Six
Seven
102
98
77
62
51
38
32
460
Technological
Training
Maintenance of
102
82
83
44
32
23
(7.0) (100.0)
12
460
International Std
Feasible Custom
Duty
Modern Looms
through Coop
Hi-tech Powerloom
Park
Import Modern
Powerloom
Introduction of
Modern Looms
115
51
155
(36.3) (33.7)
145
134
131
140
(9.6)
21
(9.3)
(4.6)
98
32
61
44
43
(9.6)
75
(7.0)
44
(9.6)
45
(9.8)
(7.0) (5.0)
32
25
(7.0) (5.4)
18
460
(3.3) (100.0)
44
460
(9.6) (100.0)
13
(5.9) (2.8)
33
15
12
(3.9) (2.6)
27
(2.6) (100.0)
11
460
(2.4) (100.0)
48
22
460
17
(4.8) (3.7)
10
460
(2.2) (100.0)
84
Table 1.8 Economies of Scale from Appropriate Technology in the Sample Units
Ranks
Economies
Increased
Sample Units
Total
One
Two
Three
Four
145
92
21
10
268
(54.1)
(34.3)
(7.8)
(3.7)
(100.0)
119
48
19
192
(62.0)
(25.0)
(9.9)
(3.1)
(100.0)
147
98
13
10
268
(54.9)
(36.6)
(4.9)
(3.7)
(100.0)
121
60
192
(63.0)
(31.3)
(4.7)
(1.0)
(100.0)
138
108
13
268
(51.5)
(40.3)
(4.9)
(3.4)
(100.0)
102
69
13
192
(53.1)
(35.9)
(6.8)
(4.2)
(100.0)
121
104
34
268
(45.1)
(38.8)
(12.7)
(3.4)
(100.0)
112
64
11
192
(58.3)
(33.3)
(5.7)
(2.6)
(100.0)
Erode
Labour
Productivity
Perundurai
Erode
Increased
Output
Perundurai
Erode
Better Quality
Perundurai
Erode
Lesser Cost
Perundurai
advantage from suitable technology and it is 181 respondents (94.3 per cent) in Perundurai;
246 respondents (91.8 per cent) are of view that better quality as the first or second most
important advantage that could be reaped from appropriate technology and the proportion for
the same in Perundurai is 89.1 per cent (171 respondents), while 225 respondents (83.9 per
cent) opine that lesser cost of production is the first or second most important economies of
scale from the suitable technology, which is accepted by 176 respondents (91.6 per cent in
Perundurai in that manner. This implies that around 90 per cent of the respondents in both
areas opine that increase in output and attaining better quality of the product are the two most
important economies that could be obtained from suitable technology.
POWER PROBLEMS
Economic development requires adequate and commensurate increase in the stock of
infrastructural facilities which chiefly includes electricity. Without proper increase in power
supply, industrial growth will suffer, as the level of idle capacity will keep on increasing.
Table 1.9 presents the area-wise opinions of the sample respondents on the adequacy of
power supply in the study area.
Table 1.9 Power Supply details of the Sample Units in the Study Area
Opinions
Yes
No
Total
Erode
Perundurai
Total
42
38
80
(52.5)
(47.5)
(100.0)
[15.7]
[19.8]
[17.4]
226
154
380
(59.5)
(40.5)
(100.0)
[84.3]
[80.2]
[82.6]
268
192
460
(58.3)
(41.7)
(100.0)
[100.0]
[100.0]
[100.0]
86
Note: Figures in round brackets are row-wise percentages and those in square brackets
are
column-wise percentages.
Source: Field survey.
Table 1.9 shows that out of the 460 sample respondents, only 80 respondents (17.4
per cent) opine that there is adequate supply of power in the study area, while the remaining
380 respondents (82.6 per cent) opine in the negative. Area-wise, out of the 268 respondents
in Erode, 226 (84.3 per cent) feel that there is no adequate power supply, while among the
192 respondents in Perundurai, 154 (80.2 per cent) opine that the power supply situation is
not conducive. Thus, more than 80 per cent of the respondents opine that there is no adequate
power supply, which is also the case in the two areas, though it is marginally higher in Erode.
The problems faced by the respondents in the power front are further examined by
analysing the area-wise ranks provided by the sample respondents about the nature of
problems among those who felt the same, with the help of the data given in Table 1.10. The
table shows that among the 226 respondents in Erode, 213 (94.2 per cent) opine that frequent
power cut and low voltage are the first or second most important problem in the study area;
179 respondents (79.2 per cent) view that less number of shifts due to power problem is the
first or second most important problem due to power; 152 respondents (67.3 per cent) opine
that extension of shift time to compensate loss of time due to power failure is the first or
second most important problem; 196 (86.7 per cent) view that decreasing quantity and quality
of production due to power failure is the first or second most important problem and 150
respondents (66.4 per cent) feel that frequent power failure which leads to labour problem is
the first or second most important problem in Erode. In the case of 154 respondents in
Perundurai, 142 respondents (92.2 per cent) opine that frequent power cut and low
Table 1.10 Problems in Power Supply faced by the Sample Units in the Study Area
Problems
Frequent
Power Cut
Ranks
Sample
Units
Total
One
Two
Three
Four
Five
165
48
226
(73.0)
(21.2)
(3.5)
(1.8)
(0.4)
(100.0)
Erode
87
and Low
Voltage
102
40
10
Nil
154
(66.2)
(26.0)
(6.5)
(1.3)
Nil
(100.0)
98
81
18
17
12
226
(43.4)
(35.8)
(8.0)
(7.5)
(5.3)
(100.0)
45
39
31
21
18
154
(29.2)
(25.3)
(20.1)
(13.6)
(11.7)
(100.0)
101
51
43
21
10
226
(44.7)
(22.6)
(19.0)
(9.3)
(4.4)
(100.0)
39
45
41
17
12
154
(25.3)
(29.2)
(26.6)
(11.0)
(7.8)
(100.0)
115
81
15
226
(50.9)
(35.8)
(6.6)
(4.0)
(2.7)
(100.0)
61
53
21
12
154
(39.6)
(34.4)
(13.6)
(7.8)
(4.5)
(100.0)
89
61
35
24
17
226
(39.4)
(27.0)
(15.5)
(10.6)
(7.5)
(100.0)
21
33
46
31
23
154
(13.6)
(21.4)
(29.9)
(20.1)
(14.9)
(100.0)
Perundurai
Erode
Less Number
of Shift
Perundurai
Erode
Extension of
Shift Time
Perundurai
Decreasing
Erode
Quantity and
Quality
Leads to
Perundurai
Erode
Labour
Problem
Perundurai
88
power failure is the first or second most important problem and 54 respondents (35 per cent)
feel that frequent power failure which leads to labour problem is the first or second most
important problem. This suggests that frequent power cut and low voltage is the most
important problem in the power front in both areas, since more than 90 per cent of the
respondents opine that way. However, there is a difference in the degree of importance
attached to each of the problems between the two areas, since those in Perundurai give only
less importance to less number of shifts than that of Erode. This indicates that the severity of
power failure felt by the respondents in Perundurai is less compared to that of Erode.
The sample respondents have also mentioned some suggestions in the power supply
front, which are ranked and presented in Table 1.11.
Table 1.11 Opinions of the Sample Units for Power Supply in the Study Area
Opinions
Ranks
Sample
Units
Total
One
Two
Three
Four
Five
162
61
26
12
268
(60.4)
(22.8)
(9.7)
(4.5)
(2.6)
(100.0)
102
67
12
192
(53.1)
(34.9)
(6.3)
(3.6)
(2.1)
(100.0)
173
69
15
268
(64.6)
(25.7)
(5.6)
(2.6)
(1.5)
(100.0)
114
57
13
192
(59.4)
(29.7)
(6.8)
(2.6)
(1.6)
(100.0)
171
55
21
16
268
(63.8)
(20.5)
(7.8)
(6.0)
(1.9)
(100.0)
99
59
17
10
192
(51.6)
(30.7)
(8.9)
(5.2)
(3.6)
(100.0)
145
70
27
15
11
268
Erode
Decrease
Power Charge
Perundurai
Regular
Erode
Supply of
Power
Perundurai
Erode
Supply of
Quality Power
Perundurai
Subsidized
Erode
89
Electricity
(54.1)
(26.1)
(10.1)
(5.6)
(4.1)
(100.0)
78
67
31
11
192
(40.6)
(34.9)
(16.1)
(5.7)
(2.6)
(100.0)
101
90
31
27
19
268
(37.7)
(33.6)
(11.6)
(10.1)
(7.1)
(100.0)
90
70
17
192
(46.9)
(36.5)
(8.9)
(4.7)
(3.1)
(100.0)
Perundurai
Erode
Slab Rate for
Electricity
Perundurai
90
EXPORT PROBLEMS
The textile industry is one of the important foreign exchange earners for the country
for a very long period. However, the industry has faced multiple problems in the foreign trade
area which has blunted its competitive edge in the global arena, particularly in the recent past.
Table 1.12 presents the problems faced by the respondents in the export of their products,
which are ranked according to its importance as mentioned by the respondents.
Table 1.12 Problems in Export faced by the Sample Units
Ranks
Problems
Competition from
Other Countries
Modernization of
Loom
Financial Weakness
to purchase Loom
Lack of Finance at
Low Interest Rate
Total
One
Two
Three
Four
Five
Six
Seven
328
76
35
11
460
(0.4)
(100.0)
460
(0.9)
(100.0)
460
(0.4)
(100.0)
460
(0.4)
(100.0)
11
460
(2.4)
(100.0)
145
460
(2.4)
356
42
21
18
(77.4)
(9.1)
(4.6)
(3.9)
348
65
23
10
61
34
79
42
(2.2)
21
(4.6)
21
(1.1) (0.7)
11
(2.4) (1.7)
9
(2.0) (0.7)
12
(2.6) (1.1)
16
13
26
31
(2.6)
(5.7)
(6.7)
78
81
68
(4.6)
56
(3.5) (2.8)
79
111
Lack of Cooperation
from Govt.
84
45
34
91
460
(100.0)
Table 1.12 reveals that 87.8 per cent of the respondents opine that competition from
other countries is the first or second most important problem in export; 86.5 per cent of the
respondents view that lack of modernisation of the looms is the first or second most
important problem in export; in the view of 89.8 per cent of the respondents, financial
weakness to purchase modern looms is the first or second most important problem; 84 per
cent of the respondents opine that non-availability of cheap finance is the first or second most
important problem in export; in the opinion of 77.6 per cent of the respondents, high custom
duty which affects free import of modern looms is the first or second most important problem
in export; only 8.1 per cent of respondents view that poor quality of cloth is the first or
second most important problem in export, while there is a mixed opinion as far as
Government support in export is concerned, since 34.6 per cent of them view it as the first or
second most important problem. Thus, it suggests that the inability of the respondents to
modernise their plants for want of necessary finance and the commensurate custom duty are
the crucial problems in export, as opined by more than 80 per cent of the respondents.
The sample respondents have provided some suggestions in order to improve exports
from powerloom sector, which are ranked according to their importance and presented in
Table 1.13.
Table 1.13 Opinions for Improving Exports by the Sample Units in the Study Area
Ranks
Opinions
Total
One
Two
Three
Four
Five
Six
Seven
38
49
55
98
102
87
31
460
Foreign Collaboration
(8.3)
Introduction of
Modern Loom
Import Modern
Powerloom
245
56
48
23
17
101
31
122
51
11
(2.4)
45
10
(2.2) (1.1)
50
34
(100.0)
10
460
(2.2)
(100.0)
460
(0.9)
(100.0)
24
460
(5.2)
(100.0)
92
Finance at Low
Interest Rate
Special Finance
233
152
31
178
39
22
(4.8)
15
10
(2.2) (1.7)
10
14
460
(0.9)
(100.0)
460
Assistance
Programme
Short and Long Term
Capital
(100.0)
(43.0) (38.7) (8.5)
278
104
25
(3.3)
21
(4.6)
(2.2) (3.0)
16
12
(3.5) (2.6)
(1.3)
4
460
(0.9)
(100.0)
93
cost of production, increasing labour productivity and increasing sales and export. The
rankings provided to these measures by the respondents are presented in Table 1.14.
Table 1.14 Future Plans of the Sample Units in the Study Area
Ranks
Measures
Total
One
Two
Three
Four
Five
287
114
41
11
460
(62.4)
(24.8)
(8.9)
(2.4)
(1.5)
(100.0)
89
78
145
123
25
460
(19.3)
(17.0)
(31.5)
(26.7)
(5.4)
(100.0)
146
122
78
61
53
460
(31.7)
(26.5)
(17.0)
(13.3)
(11.5)
(100.0)
198
141
56
44
21
460
(43.0)
(30.7)
(12.2)
(9.6)
(4.6)
(100.0)
191
160
48
36
25
460
(41.5)
(34.8)
(10.4)
(7.8)
(5.4)
(100.0)
Modernize Unit
Increase Labour
Productivity
Hypothesis One
H1: Idle capacity is scale neutral among the sample powerloom owners.
H0: Idle capacity is not scale neutral among the sample powerloom owners.
Idle capacity normally results in those units which have larger installed capacity than
among those who have smaller capacity. This is tested with the application of one sample ttest, by taking the presence of idle looms among the sample units as the testing variable.
Table 1.15 shows the test result.
Table 1.15 Testing the Difference in Idle Capacity
95% Confidence Interval
Variable
t-value
Sig.
Mean
(2-tailed)
Difference
df
459
0.000
1.4913
of the Difference
Lower
Upper
1.4454
1.5372
productivity. This suggests that there is a positive relationship between size of investment and
labour productivity. This is tested by taking the operating capacity of the units as a proxy for
size of investment and labour productivity with the application of Chi-square test and the test
result is shown in Table 1.16.
Table 1.16 Testing the Relationship between Size Investment and Labour Productivity
Statistic
Value
df
Pearson Chi-Square
596.042***
0.000
Likelihood Ratio
588.981***
0.000
0.000
N of Valid Cases
460
96
Proper reformulation of custom duty and export policy favouring the weavers will
also go a long way in solving the labour problem in the industry.
Conclusion
There is no denying the fact that the powerloom industry is at crossroads, as it is
unable to modernise itself, not able to increase labour productivity, improve product quality
and compete effectively in the international market. Many of these problems emanate from its
inability to modernise and move towards higher efficiency parameter. Apart from redefining
the policy of small scale sector, this also calls for liberal, cheap and consistent lending on a
priority basis to the powerloom industry for both short term and long term purposes. Short
term lending will enormously help the small and medium manufacturers to meet their
working capital requirement, while long term lending will be helpful in meeting the needs of
plant upgradation, expansion, modernisation, etc. The Government has enacted many
development measures from time to time, though the ills of the industry have not waned. A
holistic approach should be attempted, wherein powerloom clusters are formed in major
districts, in which raw material, power and finance are provided at subsidised rates and the
Government also extends training programmes to the weavers along with providing the
prompt marketing information.
Bibliography
Books
TIMES OF INDIA, (2010), "Textile Policy in practice: A Balance Sheet after five
years", Editorial, 17th June.
ROY, Tirthankar, (1998), Development or Distortion Power loom in India,
1950-1997, Economic and Political Weekly, April 18 ,Vol: XXXIII No. 16.
ROY, Tirthankar, (1998), A New Textile Policy Do We Need One? Economic
and Political Weekly, October.
UCHIKAWA, Shuji, (1999), "Economic Reforms and Foreign Trade Policies: Case
Study of Apparel and Machine Tool Industries", Economic and Political Weekly, Vol.
34, No. 48.
98
RAJANNA.SP
RESEARCH SCHOLAR
BANGALORE UNIVERSITY
DR.HASEENTAJ
RESEARCH GUIDE
BANGALORE UNIVERSITY
Abstract
Integrating information and communication technology (ICT) in the classroom interaction
for effective facilitation and reflective learning is very essential today. The use of ICT which
is not limited to the mere vertical growth of education can contribute significantly to self
growth by improving the learning outcomes of elementary teachers and optimizing
educational institution management processes. usually educational systems are under great
pressure with the issue of access,quality,equity to adopt innovative methodologies, innovative
strategies and integrate new information and communication technology in the teaching and
learning process, to prepare elementary teachers with the knowledge and skills they need in
the 21st century. Undoubtedly the new information and communication technology has
brought about many challenges and opportunities for elementary teachers. The educational
system needs to come to terms with these new challenges and take full opportunities given in
ncf-2005. If such educational system have to ensure that the teacher leave the institution as
confident individuals capable of using new technology creatively, innovatively and
productively then the teachers should have the competence to integrate the emerging
technologies and digital content for e-learning with vast sources of ICT like
computer,mobile,laptop,radio,webtechnologies and internet . Therefore, the challenge for
educational administration particularly teachers capable of employing variety of technology
tools into all phase of academic, administrative, research, and extension function.ICT will
definitely facilitate professional development for teachers and develops positive attitude
among the teachers.
Introduction:
The progress of any country depends upon the quality of education offered and its practices.
Indian education was well known for its Gurukula system of education in the Vedic period.
Education in India has undergone various phases and stages of development starting in the
Vedic period to the post-independent period. At all stages of development there was a
concern for bringing in quality education reflecting on the practical aspects of educational
technology in education. It is very necessary to use ICT in the form of innovative technology
for effective classroom interaction. This paper reflects some of the issues and challenges of
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integration of technology for innovative classroom management and some suggestions have
given how the ICT integrates the technology for effective and innovative classroom
management in education.
As we all know education is a lifelong process. Every moment and every minute,
learning will takes place through formal or informal or non formal experiences. Every individual
must equip himself in every moment of his life to meet the new challenges and innovations in
life.Tanja (2000) found that learners in computer supported collaboration may provide more
complete reports, may be better in idea generation. ICT is an important part of technology .ICT
means information and communication technology. ICT in education means teaching and
learning with techniques of ICT. Technology is changing our world, connecting people from
throughout the world. It has become one of the basic building blocks of our society.ICT plays a
major role in education system and it can contribute to universal access to education by
improving the quality of teaching and learning, equity in education through the latest
innovations and technology. Innovative classroom can be enriched by computer-assisted
instructions (CAI), computer-assisted learning (CAL), computer-based training (CBT) and
computer-managed instruction (CMI) for effective classroom interaction.
Revolution in education
Eric Ashby (1967) has identified four revolutions in the system of education.
The first revolution occurred when societies began to differentiate adult roles and the
task of educating the young was shifted in past, from parents to teachers and from home
to school.
The second revolution was the adoption of the written word a tool of education. Oral to
written.
The third revolution came with the invention of printing and the subsequent wide
availability of books.
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Builds valuable skills of handling the gadgets which are might be use in the future.
Teachers are the greatest assets of any educational system in any country. They are the
backbone of educational system which leads for national development. Educational commission
1964-67says that no system can rise above the status of its teacher Therefore, the teacher
education plays a significant role in the changing paradigm of teaching and learning process.
Teacher education institutes should produce the teachers to face the challenges of the world
successfully for sustainable development through effective classroom interaction.
Today, where the world of education and learning are changing rapidly, bringing new
realities and challenges to Teacher Education Institutions (TEI), through innovations in use of
Information and Communication Technologies (ICT).It has more important implications. The
year 1975-76 saw the emergence of India as a global player in education technology, when the
concept of education through satellite was effectively demonstrated for the first time through the
Satellite Instructional Television Experiment (SITE). Later with the commissioning of the
INSAT in space in 1983, a variety of education programmes are being telecast. EDUSAT - a
satellite exclusively dedicated to education, was successfully launched on board ISRO's
geosynchronous satellite launch vehicle, GSLV- 3 in September 2004. EDUSAT provides
regional beams facilitating imparting education in the regional languages very easily and
effectively.
There is a large imbalance between the ICT culture expected and practiced. Sensing the
deficiency of the lack of ICT educated human resources, the National Council for Teacher
Education (NCTE) as a capacity building exercise in the first phase has started ICT literacy
camps for teacher educators throughout India. The targeted TEIs in the first phase were covered
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in the 100 countrywide camps and hands on interactive experience was provided through a
series of self learning CDs developed by the NCTE. In this mode NCTE covered a large number
of TEIs and could motivate the teacher educators to use computers in various activities for
enriching their classroom interaction. Other initiatives of the regulatory bodies include initiative
of NCERT in conducting Computer Literacy Programmes under the CLASS project, organizing
computer programmes for teachers from the vocational and technical education streams by the
Indian Society for Technical Education (ISTE), organizing Management Information System
series for Higher education teachers by the UGC, etc. Apart for these statutory and Government
organizations, various corporate sectors and ngos like INTEL, WIPRO,IT FOR CHANGE,
Tess-India and Azim Premji foundation etc. are actively involved in technology enabled teacher
development.
Computer-assisted instruction (CAI)
According to Batra(1989) Computer-assisted instruction(CAI) refers to a learning situation in
which students interact with a computer through a course of study aimed at achieving certain
instructional goals
Importance of CAI
Surfing the Internet and locating useful information from the Internet for the
development of lesson plans.
Evaluating and selecting appropriate software for a particular subject and per student
needs.
Managing student data; using data management tools for efficiently managing
learning.
Developing tools to evaluate technology-based student projects including multimedia, word processing, database, spreadsheet, PowerPoint, desktop publishing, and
Internet/telecommunications.
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Developing assignments and project work for students; giving them broader and
deeper knowledge in a field of study; developing critical thinking and infusing
creativity among students.
.
Advantages of CBT
CBT is learner centric where the learner is free to select his own time for learning and
he will achieve the goals with its own rate of learning.
It helps for permanent learning where the learner can retains the gaining knowledge
permanently.
It helps for online teaching and trainings like MOOC programme of tess-india.
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Lack of staff development : Teachers lack of knowledge, well trained and skills is
one of the main hindrances to the use of ICT in education
Subject teachers forum (STF) should be established at all levels of education to enrich
and update the ICT knowledge of the teachers.
All training, colleges need to establish well computer labs with wi-fi Internet
facilities.
A uniform ICT based activities might be cited in the curriculum of teacher education.
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Printed ICT based practice lesson books along with specific instructions for teacher
trainees need to be developed and supplied.
There is a need to develop softwares in regional languages along with English for
effective use in different regions of the country.
ICT classroom transaction must be monitor and supervise regularly by the concern
authority with proper feedback.
Conclusion:
ICT has revolutionized the entire system of education, teaching-learning process, and
research activities by offering new opportunities and challenges in creation and dissemination
of information by web-based education. It is really a challenging task to strengthen ICT in
teacher education. The destiny of the nation is being shaped in the classrooms of
today.(Indian Education Commission 1964). If the teacher will be well trained and adopt,
adequate innovative classroom management with the use of technology in teaching and
learning process the students will be more efficient, smart and competitive to face the
challenges of 21st century vission.Initiaition need to be taken by all the stakeholders.
References:
Sethi vipin (2010) Benefits of visual aidsjournal and article from e.how writer
e.how.com.
Binkly Sheena (2004) types of audio visual aids used in teaching ) e how
contributing writer e.how .com
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A STUDY ON INFLUENCE OF BRING YOUR OWN DEVICE (BYOD) ON WORKLIFE BALANCE OF IT PROFESSIONALS
PARAMITA ROY
RESEARCH SCHOLAR FROM VISVESVARAYA TECHNOLOGICAL
UNIVERSITY BELAGAV
Abstract:
Smart enterprise and smart working is the talk of the 21st century. According to (Rosenberg,
2006) a smart enterprise is a high-performing organization that allows knowledge and
capabilities, enabled by technology, to grow and flow freely across departmental,
geographical or hierarchical boundaries, where it is shared and made actionable for the use
and benefit of all. With advanced technology there is a paradigm shift in the way work is
done. It is the smart way or agile way of working enabled by technology. Work in 21 st
century is about how much you do not where or when you do. Strategic use of technology has
enabled people to carry out their work from locations other than office. Smartphones, tablets,
iPad have revolutionized the concept of working. It gave rise to a technological phenomenon
called Bring Your Own Device. This gave more autonomy to employees. This allows
employees to have more time for family without compromising work. However, this
technological advancement has also lead to blurring the boundaries between work and
personal life. Previous research also shows that BYOD has changed the attitude of
professionals from live to work to Working to live. The aim of this article is to find out
the effect of BYOD on professional as well as personal life of the IT professional. So this
paper explores about the influence of bring your own device (BYOD) on work-life balance of
an employee. Literature review explores the past and present perception about BYOD. The
pros and cons of BYOD both from employers and employees perspective. Quantitative
research methodology is used for the study and questionnaire is administered as research
method. Result discusses the interpretation of the data from univariate analysis.
Key words: Bring your own device, Work-life balance.
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1. Introduction:
Technological advancement has revolutionised the way of working. Now the work is not
9 to 5 job. The knowledge workers are getting more tech savvy by the day. They are
connected 24/7 with their friends, relatives and the world. They like to use various
devices like Smartphones, tablet, laptop to stay connected all the time. They expect the
same experience at the work place. So basic law of economics of supply and demand
applies and the markets are flourishing with advanced technology and devices. This
revolution has made the corporates to allow the employees to use their own device in the
workplace. This movement is called Bring your Own device (BYOD). This is an
extension of smart way, agile way or new way of working. So technology has bought our
home life into workplace and our jobs to home also present opportunities as well as
challenges.According to(Dash, Anand, & Gangadharan, n.d.) technological advancement
has morphed the work and personal lives of IT professionals into a single whole. Due to
long working hours the stress level for IT professional are high. This leads to imbalances.
It is a concern for both the employees and employers. The imbalances will affect
employees physical as well as mental health. Productivity will come down and
absenteeism will rise. It is definite that BYOD helps in flexibility but research shows that
it has blurred the line between personal and professional life. This article tries to explore
about the influence of BYOD on the work-life balance of the IT professionals.
Necessity of employee mobility has forced organisations to implement bring your own
device policy.BYOD has established a culture like we are always on or always
available.
2. Problem Statement: Literature review shows that BYOD provides flexibility to an
employee. The productivity has increased. Employee are satisfied as they are not tied to 9to5
traditional working hours pattern. Research also shows that people are connected 24/7 and are
always reachable. Apart from security and data retrieval concern corporates are also benefited
by the BYOD. But many employees find BYOD pressures them to be willing and able to
work after hours or on weekends. It is proved that BYOD allows flexibility which allows a
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employee to balance work/life but on the other hand how this expectation affects work/life
balance. Not much was found in literature review which describes the influence of BYOD on
work/life balance. So the objective of the article is to study the influence of BYOD on
work/life balance of an employee.
3. Research Methodology
To study the above objectives a systematic review of literature was performed.Literature
review study is based on the secondary data collected from various sources like company
websites, articles from journals, articles from respected newspapers and magazines, reports
from university research centres and non-profit agencies. Qualitative research methodology
with questionnaire method is used for this article. Stratified random sample of 50 full time IT
professionals are collected to analyse the objectiveof the study.
4. Literature Review
According to Wikipedia the term BYOD first entered common use in 2009, courtesy
of Intel.Inc when it recognized an increasing tendency among its employees to bring their
own devices (i.e., smartphones, tablets and laptop, computers) to work and connect them to
the corporate network.It is an IT consumerisation trend which allows employees to use their
own devices at work places as well as access corporate network and data from anywhere and
anytime. According to a projection by Cisco by 2018 70% of professionals will conduct their
work on personal smart devices. Research and survey proves that BYOD increase employee
productivity. A survey conducted by Dell Software found out various areas of increased
employee productivity like ability to foster creativity, innovation, increased moral and more
team work/collaboration.Similarly, Intel reports that 17000 employees who have used
personal device for work has shown an average increase in productivity of an hour per day.
BYOD allows tech-savvy workers more flexibility and a break from traditional 9to5 work
routine. It allows employees to work on the familiar and comfortable devices. Corporates
save money as they dont have to buy devices for each of the employees. But there are issues
of security, data retrieval with the use of BYOD by the employees. It has also established a
culture like we are always on or always available. Technology is a good servant, but a
bad master. BlackBerrys, iPhones and other devices exist to make our life easier, not to rule
it. So is BYOD a boon or bane for an employee to manage the work/life balance as with
BYOD the employee is available 24/7. The term work/life balance was first coined in 1986 in
reaction to the unhealthy choices that many Americans were making in favour of the
108
workplace as they opted to neglect family, friends and leisure activities in the pursuit of
corporate goals.Worklife balance is a concept including proper prioritizing between "work"
(career and ambition) and "lifestyle" (health, pleasure, leisure, family and spiritual
development/meditation). This is related tothe idea of "lifestyle choice." The influence of
more flexibility and autonomy in your job on work/life balance is found to have several
positive outcomes. However there are also negative influences. Olson and Primps (1984)
suggest that the lack of separation between work and family can lead to work holism.
Kurkland& Bailey (1999) found that virtual office employees had more difficulty to manage
their work/life balance in comparison to traditional office workers.So the article aims to
explore the influence of BYOD on the work/life balance. The analysis of the response from
the respondents about the same is detailed in the result section of the article.
5.Results:
5.1. Usage: Respondents are asked about how they use their personal devices for work.Graph
shows 25% of people use BYOD for work email followed by Teleconference and intranet.
5.2.All the respondents uses BYOD for office works and felt that BYOD provides more
flexibility in terms of place and time.
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5.3. When asked how BYOD helps in productivity, the main reason sighted by the
respondents that they are more productive because BYOD allows flexibility.
5.4. Then to understand the influence of BYOD on work/life balance, a graph is plotted for
the 50% of respondentsonly (who said that productivity increased because of flexibility)
against whether BYOD disrupts work/life balance.
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5.7. Strikingly when respondents are asked whether usage of BYOD has blurred the
professional and personal space, a mixed reaction was recorded deviated from earlier result.
6.Conclusions:
Survey proves that BYOD has increased the productivity. Employees are more flexible and
are not stuck to traditional pattern of 9to5 way of working. Definitely BYOD has made the
employees always reachable and the expectation of colleagues and supervisor have increased.
This shows that employees agreed that BYOD has negativelyinfluenced on the work/life
balance of the employees. But the results are not conclusive as the sample size is small to
reach for a concrete conclusion. Last but not the least the true secret of work/life balance is
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that spending more time checking more emails does not make you more important or more
valuable as an asset to your company and clients. To borrow the old saying, its not the
amount of days in your work, it is the amount of work in your days. Definitely this
technological revolution BYOD is going to stay and as predicted its usage will increase.
Because it is the new way of working which is going to stay, so it is us who should
understand the expectation and balance our work and life.
7. References:
Azmi, F. T., & Khan, M. N. (2004, July). Flexi by Far. Humancapital Online.
Bertheau, T. (2015, April 29). The Knowledge Workforce. Retrieved from Linkedin: www.linkedin.com
Campbell.Scott. (2013, January 22). Study:BYOD brings productivity gains. Retrieved from CRN:
www.crn.com
Dash, M., Anand, V., & Gangadharan, A. (n.d.). Perception of work/life balance among IT
professionals. Retrieved from Questia: www.questia.com
Goodman, C. K. (2014, January 5). The Workplace Challenges of 2013. Pittsburgh PostGazette (Pittsburgh, PA). Retrieved from Questia.
Houston, D. M., & Waumsley, J. A. (2003). Attitudes to Flexible Working and Family Life. Bristol: The
Policy Press.
Kurkland, N .B ,& Bailey, D.E,(1999). When workers are here, there, and everywhere ; A discussion of
the advantages and challenges of telework. Organizational Dynamics,28, 53-68
Mukherjee, R. (2015, October). Learning to Manage your Work and your Life. Retrieved from
Humancapital Online: www.humancapitalonline.com
Olson, M., & Primps, S. (1984). Working at home with computer work and non-work issues, Journal
of Social Issues, 40,97
Reilly, P. A. (2001). Flexibility at work: Balancing the interests of employer and employee. Hampshire:
Gowen Publishing House.
Shoba, D., & Dr.Suganthi, M. (2015). Making it work: An empirical study on impact of flexible
working arrangements on Indian Families. International Journal of Advanced Scientific
Research & Development, 67-75.
Twilley, R. (2013, April 26). With BYOD, Employee Productivity Surges. Retrieved from Forbes/Tech:
www.forbes.com
Williams, A. (2005). Flexible Working-Latest best practice for employers and employees. London:
Thorogood Publishing Ltd .
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DIGITAL BANKING
SHASHIKALA S N
ASSISTANT MANAGER
HDFC BANK LTD
BANGALORE.
Abstract
The purpose of this research paper is to study how the e-banking (digital banking)
consumers perceive the e- banking services of public, private and foreign sector
banks operating in the Indian banking sector and also making a deeper introspection
of service quality in all three types of banks to understand whether there is a
significant difference in service quality on the basis of nature of banks.
This aims at creation of a secure Internet banking system. This will be accessible to
all customers who have a valid User Id and Password. This is an approach to
provide an opportunity to the customers to have some important transactions to be
done from where their place without visiting to bank. In this article we are going to
deal the existing facts in the bank i.e.; the transactions which takes place between
customer and bank. We provide a real time environment for the existing system in
the bank. We deal in the method transaction in the bank can be made faster and
easier that is our internet based computerized approach towards banking.
Online banking system can be considered as the one of the great tool supporting
many customers as well as banks and financial institutions to make may banking
activities through online. Every day, banks need to perform many activities related to
users which needs huge infrastructure with more staff members etc. But the online
banking system allows the banks to perform these activities in a simpler way without
involving the employees for example consider online banking, mobile banking, ATM
banking and also chillrapp and Payzapp. But banking system needs to be more
secure and reliable because each and every task performed is related to customers
money. Especially authentication and validation of user access are the major tasks in
the banking systems.
Introduction
113
In this area of stiff competition, public, private and foreign sector banks in India have
realized the importance of achieving high levels of customer satisfaction by providing
service quality of world class. Banks operating in these three sectors are
consequently putting a lot of pressure due to increase in competition. Various
strategies are formulated to retain the customers and the key of it is to increase the
service quality level. Service quality is particularly essential in the banking services
context because it provides high level of customer satisfaction and hence it becomes
a key to competitive advantage as well as it leads to customer retention. Nowadays,
service quality has received added attention because of its relationship with costs,
financial performance, customer satisfaction and customer retention. Due to the
dawn of e-banking, quality of service has been enhanced as compared to
conventional banking services. Internet banking, Mobile banking, Automated Teller
Machine, electronic fund transfer has totally altered the way of providing services by
the banks. As customers are now becoming tech-savvy, therefore, it becomes
indispensable to consider the use of technology to react to their continuous needs.As
the service quality improves, the probability of customer loyalty increases. Bank
automation and electronic banking is invading at a rapid pace and private sector and
foreign sector banks have an advantage of adopting it at a faster pace than the
public sector banks and it also has to capture the pace.
E-banking is an improvement over traditional banking system because it has
reduced the cost of transaction processing and thereby improving the payment
efficiency and also improving the banker-customer relationship. The relationship
between e-banking and service quality can be studied with the level of customer
satisfaction and loyalty. E-banking plays a pivotal role in providing satisfaction to the
customers. Banks should discover innovative ways of making electronic services
more accessible and by allowing the customer to verify the accuracy of the ebanking transactions.
ATMs and mobile applications have created a profound impact on the delivery
channels of banking services. Also, a number of innovative developments in retail
payments have emerged, which affect the retail payment market by influencing users
in their choice of payment instruments and by significantly reshaping the payment
processes. Notwithstanding the growth of various electronic modes of payment in
India, it still has a long way to go in terms of achieving the high levels of penetration
of such modes across the world, particularly in high economy countries. The usage
114
Objectives
This study aims to explore the difference in the e-banking service quality features of
public, private and foreign sector banks. It also covers the relation between customer
loyalty and service quality factors in banking sector to help banks to increase
customers satisfaction.
The measure of customer loyalty used in the study comprises of nine items:
i.
ii.
iii.
iv.
v.
vi.
vii.
viii.
E-Banking has reduced the 'Gap' between the bank and the client
The Housing Development Finance Corporation Limited (HDFC) was amongst the
first to receive an 'in principle' approval from the Reserve Bank of India (RBI) to set
up a bank in the private sector, as part of RBI's liberalization of the Indian Banking
Industry in 1994. The bank was incorporated in August 1994 in the name of 'HDFC
Bank Limited', with its registered office in Mumbai, India. HDFC Bank commenced
operations as a Scheduled Commercial Bank in January 1995. According to
the Brand Trust Report 2014, HDFC was ranked 32nd among India's most trusted
brands. HDFC was ranked 45th on the list of top 50 Banks in the world in terms of
their market capitalization.
1. NETBANKING
2. MOBILE BANKING
3. CHILLR APP
4. PAYZAPP
NET BANKING
Net Banking is an incredibly convenient and powerful tool, letting you do everything
you want with your accounts at the click of a mouse.It is Real Time, giving you up-tothe-second details on your account.All you need to do is Log in using your Customer
ID and IPN (Net Banking password).
Check your account balances and download 5 year account statement in 5 formats,
instantly
View your Credit Card details and pay your Credit Card Bills
Request Stop Payment of a Cheque/ Hotlist you Debit Card/ Credit Card
Transfer funds between accounts within HDFC Bank and other Bank Accounts and
also other bank credit card payment.
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These are some of the 175+ transactions you can do through Net Banking.
Through net banking we can transfer fund from one account to other account using 3
type of transaction they are:
1. NEFT (NATIONAL ELECTRONIC FUND TRANSFER
2. RTGS (REAL TIME GROSS SETTLEMENT)
3. IMPS ( IMMEDIATE PAYMENT SERVICE)
This is a Funds Transfer service, to transfer funds to Accounts outside HDFC Bank.
Any amount in the range of Re. 1 to Rs. 10 Lacs can be transferred through this
facility. You need to Add a Beneficiary to transfer funds to his Account. Only the
Account Number and IFSC details are used to carry out the transaction.
Amounts from Rs.10,001 to Rs.1 lakh - Rs. 5 (exclusive of taxes) per transaction
Amounts above Rs. 1 lakh up to Rs. 2 lakh - Rs. 15 (exclusive of taxes) per
transaction
The Funds transfer request made by 6 p.m. will be presented to RBI on the same
day. The Funds transfer request made after 6 p.m. will be presented to RBI on the
next working day.
Funds transfer request made on non- working days will also be presented to RBI on
the next working day.
The maximum amount of funds that can be transferred per customer ID per day is
Rs.10 lakhs.
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REAL TIME GROSS SETTLEMENT, RTGS, IS THE FASTEST POSSIBLE MONEY TRANSFER
SYSTEM THROUGH THE BANKING CHANNEL. BECAUSE SETTLEMENTS ARE MADE IN REAL
TIME, TRANSACTIOS ARE NOT SUBJECT TO ANY WAITING PERIODS.
WITH RTGS,
The Funds transfer request through RTGS Net Banking mode can be made only
from 08:00 am to 04:00 pm.There will be no RTGS transactions possible on Bank
holidays and Sundays.The money will reach the Beneficiary's Bank within the time
stipulated by RBI.
IMPS
IMPS(Immediate Payment Service) from HDFC Bank is an instant real time interbank electronic fund transfer service. Using this service, you will now be able to
receive or send money even on Sundays and Bank Holidays or late at night.
MOBILE BANKING
HDFC Bank Mobile Banking App for Android helps you check your account balance,
transfer funds, pay your bills and much more. With our mobile Banking App you can
access over 75 transactionsanywhere anytime.
The new App for Android is loaded with great features. We are the first bank offer the
My Menu feature. You can customize your menu with 10 of your favorite transactions
with this feature. We are the only bank have a Mobile Banking App in Hindi for
Android phones.
CHILLR APP
Chillr is a revolutionary new app that lets you send money immediately to anyone in
your phone book, 24 hours a day, 7 days a week. No more hassles of adding
beneficiaries!
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You can request money, split bills amongst friends and can also recharge your
mobile, DTH & data cards. Soon you will be able to pay at online or offline stores
using Chillr.
Chillr is launching first for HDFC Bank and is available exclusively for customers of
HDFC Bank. As an HDFC Bank customer, you can also transfer money to your
contacts having other bank accounts.
PAYZAPP
PayZapp, a complete payment solution, giving you the power to pay in just on click
with PayZapp, you can shop on your mobile at partner apps, buy movie tickets,
music and groceries, compare and book flight tickets and hotels, shop online and get
great discounts at smart Buy, send money to anyone in your contact list, pay bills
and recharge your mobile, DTC and data card.
So link your Debit and Credit Card to PayZapp and enjoy the most convenient and
secure way of payment.
Cards link karoekbaar, pay karobaarbaar!
Conclusion
In this we discussed how the new payment methods impact on banking and
transactions between the individuals would be made more convenient.The mobile
and wireless market has been one of the fastest growing markets in the world. The
arrival of technology and the escalating use of mobile and smart phone devices, has
given the banking industry a new platform. Connecting a customer anytime and
119
anywhere to theirmoney and needs is a must have service that has become an
unstoppable necessity. This worldwide communication is leading a new generation
of strong banking relationships. The banking world can achieve superior interactions
with their public base if they accommodate all their customer needs. They have a
unique challenge to keep their customer alliances and keeping up with the new
technologies, andcompetitive strategies that other banks also have to offer the
public. Conveniences of services plus outside locations like ATMs are crucial to
every banks success. Meeting all challenges including safety and security are
perfect examples of good banking strategies. In order for thefinancial institutions to
effectively grow they must embrace the new technologies and customize them to suit
their economic success and the publics success. Online banking is certainly here to
stay. Online banking is a necessity for the bank's that we studied and others in order
for them to stay inbusiness.
References
www.hdfcbank.com
http://www.hdfcbank.com/aboutus/general/default.htm
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Digital Technologies which include Cloud Computing and Mobile Applications have
emerged as catalysts for rapid economic growth and citizen empowerment across the globe.
Digital technologies are being increasingly used by us in everyday lives from retail stores to
government offices. They help us to connect with each other and also to share information on
issues and concerns faced by us. In some cases they also enable resolution of those issues in
near real time.
The objective of the Digital India Group is to come out with innovative ideas and practical
solutions to realise Prime Minister Narendra Modis vision of a digital India. Prime Minister
Modi envisions transforming our nation and creating opportunities for all citizens by
harnessing digital technologies. His vision is to empower every citizen with access to digital
services, knowledge and information. This Group will come up with policies and best
practices from around the world to make this vision of a digital India a reality.
Digital India is an initiative by the Government of India to ensure that Government services
are made available to citizens electronically by improving online infrastructure and by
increasing Internet connectivity.
This is a conceptual paper will touch some of the important aspects of Digital India
program will have a bearing on the Indian economy like how it drives the economy and what
are the barriers in the implementation and execution of this program.
Key words: Digital India internet connectivity economic development social
transformation
Introduction:
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Managing Director Mukesh Ambani, Tata Group chairman Cyrus Mistry, Wipro Chairman
Azim Premji and many others, were among the business honchos who shared their ideas of
taking digital revolution to the masses. . What is Digital India? With the launch of Digital
India programme, the government is taking a big step forward to transform the country into a
digitally empowered knowledge economy includes various schemes worth over Rs 1 lakh
crore like Digital Locker, e-education, e-health, e-sign and national scholarship portal.
BharatNet in 11 states and Next Generation Network (NGN), are also a part of Digital India
campaign. Apps for Digital India Digital India Portal, MyGov Mobile App, Swachh Bharat
Mission App and Aadhaar Mobile Update App. Vision Of Digital India Digital Infrastructure
as a Utility to Every Citizen Governance & Services on Demand Digital Empowerment of
Citizens Pillars Of Digital India Broadband Highways Universal Access to Phones Public
Internet Access Programme e-Governance - Reforming government through Technology eKranti - Electronic delivery of services Information for All Electronics Manufacturing Target NET ZERO Imports IT for Jobs Early Harvest Programmes Impact of Digital India by
2019 Broadband in 2.5 lakh villages, universal phone connectivity Net Zero Imports by 2020
400,000 Public Internet Access Points Wi-fi in 2.5 lakh schools, all universities; Public wi-fi
hotspots for citizens Digital Inclusion: 1.7 Cr trained for IT, Telecom and Electronics Jobs
Job creation: Direct 1.7 Cr. and Indirect at least 8.5 Cr. e-Governance & eServices: Across
government India to be leader in IT use in services - health, education, banking Digitally
empowered citizens - public cloud, internet access Benefits of Digital Locker Digital Locker
facility will help citizens to digitally store their important documents like PAN card, passport,
mark sheets and degree certificates. Digital Locker will provide secure access to Government
issued documents.
What is National Optical Fibre Network (NOFN)? NOFN proposes seven lakh
kilometres of optical fibre to be laid to connect 2, 50,000 Gram Panchayats in three years
Here are some of the projects and products that have been launched, or are ready for
deployment, as part of the Digital India initiative:
- Digital locker system to minimise usage of physical documents and enable their e-sharing
122
via
registered
repositories.
Disseminate"
approach.
- Swachh Bharat Mission Mobile app to achieve the goals set by this mission.
- E-Sign framework to allow citizens to digitally sign documents online using Aadhaar.
- e-Hospital system for important healthcare services such as online registration, fee payment,
fixing doctors' appointments, online diagnostics and checking blood availability online.
and
disbursal.
- Digitise India Platform for large-scale digitisation of records in the country to facilitate
efficient
delivery
of
services
to
the
citizens.
- Bharat Net programe as a high-speed digital highway to connect all 250,000 gram
panchayats of country -- the world's largest rural broadband project using optical fibre.
- BSNL's Next Generation Network to replace 30-year old telephone exchanges to manage all
types of services like voice, data, multimedia and other types of communication services.
BSNL's
large
scale
deployment
of
wi-fi
hotspots
throughout
the
country.
- 'Broadband Highways' as one of the pillars of Digital India to address the connectivity issue
while enabling and providing technologies to facilitate delivery of services to citizens.
- Outsourcing Policy to create such centres in different north-eastern states and in smaller
towns
across
the
country.
funds.
- National Centre for Flexible Electronics to promote research and innovation in the emerging
area
of
flexible
electronics.
and
To
private
make
institutions
Post
Offices
such
as
multi-service
Nasscom.
centres.
125
VIDYASHREE D V
RESEARCH SCHOLAR,
DEPT. OF STUDIES & RESEARCH IN COMMERCE ,
TUMKUR UNIVERSITY TUMKUR
ASSISTANT PROFESSOR, JINDAL FIRST GRADE COLLEGE
BANGALORE
Abstract
Currently majority of interbank mobile fund transfer transactions are channelised through NEFT
mechanism. Under NEFT, the transactions are processed and settled in batches, hence are not real
time. Also, the transactions can be done only during the working hours of the RTGS system.
With the above context in mind, NPCI conducted a pilot study on the mobile payment system with the
banks like SBI, BOI, UBI and ICICI in August 2010. Also the banks like Yes bank, Axis and HDFC
bank
joined
this
league
in
the
month
of
september,
october
and
november
2010
respectively. Immediate Payment Service (IMPS) public launch happened on 22nd November 2010 by
Smt. ShyamalaGopinath, DG RBI at Mumbai and this service is now available to the Indian public.
IMPS offers an instant, 24X7, interbank electronic fund transfer service through mobile phones. IMPS
is an emphatic tool to transfer money instantly within banks across India through mobile, internet and
ATM which is not only safe but also economical both in financial and non financial perspectives. The
present paper focus on how the introduction of IMPS service has raised the number of banking
transactions and to how far the use of mobile payment service is used by customers.
Key words: Immediate Mobile Payment Service, Inter-bank Mobile Payment System, Customers,
banking transactions.
126
INTRODUCTION
Using Immediate Payment Service (IMPS), a relatively newer service, users can transfer money
immediately from one account to the other account, within the same bank or accounts across other
banks. Similar to NEFT, there is no minimum amount for transactions, but the maximum amount
possible is Rs 5 lakhs, which is again, can vary between banks.
IMPS is a payment service introduced by National Payments Corporation of India (NPCI). The eligible
criteria for the Banks who can participate in IMPS is that the Bank should have approval from RBI for
Mobile Banking Service. The service, launched as an instant mobile remittance solution in November
2010, has today evolved as a multi-channel, multi-dimensional remittance platform. The IMPS
platform today is capable of processing P2P (Person to Person), P2A (Person to Account) and P2M
(Person to Merchant) remittance and transactions can be initiated from Mobile, Internet as well as
ATM channel. In addition to banking customers, non-banking customers can also avail the IMPS
facility through Reserve Bank of India (RBI) approved PPIs.
This can be payments for utility bills, mobile or DTH recharge, credit card bills, grocery bills, travel
ticketing, online shopping and even educational institutes fee payments through this channel.
Objectives
To know the extent of mobile instruments usage by the customers as a channel for accessing
their banks accounts and remit funds
To understand the fulfillment of the goal of Reserve Bank of India (RBI) in electronification
of retail payments
127
Research Methodology
The present study is based on descriptive study which includes secondary data. The secondary data is based
on RBI Annual Reports, Natonal Payment Corporation of Indias Publications and reports, newspaper and
magazines.
Remitter (Sender) transfer funds to beneficiary (Receiver) using Mobile no. & 7digit MMID of
beneficiary.
In ABRS, a remitter can initiate IMPS transaction using the beneficiarys AADHAAR number, which acts
as a financial address & which will be linked to the beneficiaries account number. ABRS facilitates in
simplifying the IMPS payment initiation process as in this service the customer will have to input only
AADHAAR number of the beneficiary for initiating an IMPS transaction. Another important utility of this
service will be in disbursal of subsidy payment i.e. Electronic Benefit Transfer (EBT)/ Direct Benefit
transfer (DBT) by the Government. ABRS will act as a catalyst in expanding financial Inclusion reach.
Merchant Payments
Grocery bills Travel & Ticketing Credit Card bills Utility bills Online shopping School &
College fees Mobile top ups & DTH recharge
National Unified USSD Platform (NUUP)
NUUP (National Unified USSD Platform) is a USSD based mobile banking service from NPCI that brings
together all the Banks and Telecom Service Providers. In NUUP, a customer can access banking services by
just pressing *99# from his/her mobile phones. This service works across all GSM mobile handsets.
Query Service on Aadhaar Mapper (QSAM)
QSAM (Query Service on Aadhaar Mapper) This service helps user in knowing their Aadhaar Seeding
status with their bank account. This service can be availed by dialling *99*99#. User will know whether
his/her AADHAAR number is seeded/linked to any bank account number or not. If yes, then with which
bank and when it was last updated [IMPS FAQs] 5/7 Public Enabling for IMPS.
Advantages of IMPS over NEFT and RTGS
1. Instant Transfer of Money: -It happens instantly within few seconds, so its practically real time
money transfer, unlike NEFT or RTGS which works in batches and takes time in money transfer
2. Transfer without Internet Connection: -The money can be transferred just using your mobile phone
through SMS or using the mobile application, hence we can do the money transfer even while
moving/travelling and just with a mobile connection
3. Money transfer even on Holidays and outside working Hours: - We can literally make transfers in
early morning, midnight or whatever time we want unlike NEFT or RTGS, where it doesnt allow
money transfer on holidays or even Sundays
4. No Need to disclose Bank account number and other details: - With only mobile number and MMID,
we can transfer the amount and thus can secure the bank account details
Volume (Billion )
Value (` Billion)
129
2013
2012-13
1
Customer
Transactions
Interbank
Transactions
Interbank
Clearing
2014
Aug.
Sep.
Oct.
2013-14
5
Aug.
Sep.
Oct.
10,889.21 9,127.92
Immediate
Payment Service 4.33
4.71
5.53
7.32
95.81
35.20
42.95
48.99
14.13
15.62
19.75
224.18
48.58
82.68
90.35
(IMPS)
Mobile Banking 59.90
Source: RBI
Sep.
Aug.
Mobile Banking
Oct.
2013
201
3-14
2014
Oct.
Sep.
Aug.
201
2-13
Volume (Billion )
Value (` Billion)
Chart 1 showing a comparative raise in mobile banking transactions from 2013 to 2014
50
100
150
200
250
510 million7
589 million
130
182 million
22 million
Source :NPCI
Findings
IMPS have a greater impact on increasing the banking transactions particularly interbank fund transfer.
The usage of IMPS has increased drastically for a year from 2013-14.
The era is moving towards electronification in payment system.
The goal of RBI and NPCI towards payment system is being fulfilled more through
mobile payment transaction.
IMPS is linked for merchant payment also which made mobile transactions increasing.
Suggestions
As per merchant payment still more effort is needed to build trust and security among
Usage awareness should be created among all the customers particularly with rural
and old age people about the usage of IMPS with security norms.
References:
www.npci.org.in
https://www.rbi.org.in
131
PROF. VS CHAUHAN,
ACHARYA BANGALORE B SCHOOL, BANGALORE
MR. SACHCHIDANAND,
FELLOW SCHOLAR IIM BANGALORE
Abstract :
Presently in todays cut throat competitive technology sphere, alliances with
larger-established firms offers the start-ups a strong means of overcoming the liability of
smallness and newness which invariably haunt the new venture firms. Though the study of
the cases of a successful alliance formation between IVT and IIPM, the authors have
attempted to distil few key implications for start-ups. The case has also been analyzed from
different lenses to study the alliance relationship formation.
From the start-up perspective, one could learn lessons regarding navigating the business. On
the consumer front, the start-up could benefit from uniqueness of the product, knowing their
competitors and their offerings, and what would be the primary consideration of the
consumer. Developing relationships with the customer could also help start-ups to seek
potential cooperative partnerships.
towards developing a comfort level with the alliance manager. If the start-up has already
developed a sense of comfort to the customer, this should have a positive rub-off on the
alliance. They should also work towards creating a comfort level for the delivery team of the
partner. The above mentioned inputs could help the start-up develop a positive orientation
towards forming an alliance successfully.
Key Words: Strategic Alliances, New Ventures, Virtual Desktop Infrastructure, social
identity,
Structural Holes, new venture agility
132
Introduction :
Todays business enabled by Information Technology (IT) is extremely fast paced and
constantly evolving. The evolution and innovations in the IT sphere both on the hardware
and software fronts; have directly influenced the way business is performed. A shift from the
proprietary and customized business solutions offered by IBM in the 1960s to the cloud
enabled modern business; organizations have always tried to catch up with the technology
innovations.
Many businesses do not have the complete knowledge to implement an IT solution and hence
rely on external organizations to help them. These IT solution vendors have to stay on top of
the ever changing technology innovations to help their clients gain a business advantage
using IT. The pressure of staying ahead pushes these vendor organizations to forge strategic
alliances that can help them deliver the right solution.
Strategic Alliances are arrangements between firms forming a cooperative partnership. Parts
of their businesses are linked by mutual commitment of resources for the achievements of
common objective (Raghunath, 1996). This arrangement is often voluntary, and involves the
exchange, sharing or co-development of products, technologies or services (Gulati 1998).
Specifically in IT, strategic alliances tend to be of two types between two large established
organizations, or between an established large player and a new entrant. While there has
already been a lot of research on alliances and network between established players, research
on the alliances between an established player and new ventures is steadily raising. This
paper contributes to the later stream.
Large Organizations by virtue of their sustained business exposure accumulate resources
both tangible and intangible that enable them continue their dominance in the established
markets. In addition to the gaining a competitive advantage based on their resource base
(Barney, 1991), they acquire enhanced legitimacy amongst their customers. This legitimacy
is often gained by a sustained delivery of the promised value proposition.
133
These large firms in their pursuit of the sustained competitive advantage often emerge as
laggards in technology adoption. Greater shareholder focus and commitment to quality
standards increase the organizational inertia and reduce the organizations agility, flexibility,
cross-linkages etc required to develop innovations. These limitations of the larger firms could
be effectively overcome by a strong strategic alliance capability of the organization.
To catch up with the evolving trends and reduce risk associated with over-commitment
towards any specific technology these firms choose to adopt a strategy of alliance with the
technology leaders and sustain their edge with their customers.
While the larger firms find themselves limited by their inertia and slow reaction, the smaller
start-up/new venture firms have their own set of challenges.
New Ventures are often the innovation hubs that introduce new technology applications to
open up new markets etc on the cutting edge of technology. Their flexibility, agility and
survival instincts often drive these firms to innovate. However, they are often challenged by
the liability of smallness and newness (Freeman, Carroll, & Hannan, 1983) to make effective
in roads into building a sustainable business by creating a market acceptance and credibility.
The overcome the limitations that both types of firm face and to realize economic value
strategic alliance between the smaller start-ups and the larger firms is a good case. A case in
this context is the IVT & IIPM alliance.
Methodology for the study:
In the context of an established firm, new venture relationship, this study uses a qualitative
interview based research to observe the alliance formation phase.
Based on primary interview with two key alliance agents from both the companies Mr S
for IIPM and Mr AS for IVT, I develop a case of alliance formation. I identify the distinct
steps that were existent and then look at the case from various lenses to explain the behaviour
of the parties.
Alliance Formation: The Case of IIPM-IVT
In early 2015, as AS sat with SP his cofounder, having implemented the solution at BS; it
dawned on him that they had nearly put in four and half weeks effort on behalf of their
alliance partner IIPM in deploying their Virtual Desktop Solution, but didnt have an alliance
partnership in place. The BS deal had taken nearly 2.5 years to finally come to their hands,
for which AS had worked closely with his first point of contact Mr S at IIPM. S had
just left the organization and AS had to build a new set of relationships going forward at
IIPM. He now had to formalize the alliance on paper if he had to make this first project form
the IIPM alliance a repeatable business for IVT.
134
Background:
After completing his B. Tech in Biotechnology from the IIT-C in 2008, AS followed the
crowd like many of his batch mates to join the IIMS to do his MBA. While at IIMS, given his
background in bio-technology, he got his internship at BS. BS was one of the leading Indian
bio-tech firms in the global arena.
As part of his internship he was devising global market entry strategy for a generic of a
blockbuster drug. His work impressed the firm to offer him an extended role after his MBA
when he was offered the role of Program Manager and BD&L, Novel Programs. As the
Product Manager at BS, his role and activitiesi included:
Managing an early stage drug development program (with an yearly budget $7-8 Mn);
he saw the program through Phase 1a stage
Screening number of drug candidates for in-licensing for the BS novel products
portfolio; here he conducted technical and financial feasibility analysis
The daily routine work at BS kept him wondering if there was something he could attempt to
keep himself engaged. His dinner table discussions on these lines with his roommate - SP,
also a batch mate from IIT Madras, gave him the spark he was looking for. SP was working
at Intel for nearly 4 years. After debating on number of ideas, the two friends decided to
venture on building a private cloud solution, and the tools that could help manage the various
demands. With a very hazy idea, they decided it was time to make the call of quitting the
firms they were working.
When AS decided to leave BS, he let the Vice President (VP) to whom he was reporting to;
know that he was venturing into developing a cloud solution. The VP had watched ASs
work at BS closely and was extremely satisfied with his performance; he was now impressed
by ASs entrepreneurial zeal and immediately connected him with the Chief Information
Officer (CIO), of BS. The CIO of BS, asked him to reach out once they had developed the
product.
Though AS and SP didnt have a clear product idea, they had decided they would
develop a product in the cloud infrastructure management solution space targeting Small and
135
Medium Enterprises (SME). The CIOs conversation had given AS a reinforcement of his
wish, and the two founders decided to get going with their venture.
In June 2012, having incorporated their firm and with a bare minimal product that they had
developed, the two entrepreneurs sought incubation at the N-Center at IIMS. The serene and
academic environment at IIMS offered the perfect place to develop their product into a fullfledged offering.
Building on their initial idea of developing the complete stack that could help install, operate
and manage private clouds, as they researched their business space closely they realized that
most of their initial idea was already available as OpenStack. OpenStack was an open source
IT infrastructure management tool that had been backed by some of the big names in the
industry like HP, IIPM, and Dell etc. Other competing stacks like Cloudstack, Eucalyptus etc
didnt have such a large backing by the majors of the industry. The two founders felt, this
was a safe cloud stack on which they could develop the key differentiating software solution
further.
They felt, Virtual Desktop Infrastructure (VDI) could be the first thing that would help them
demonstrate their product immediately they set out to building it on the OpenStack. They
set out to build their first prototype that could be demonstrated to potential clients.
Once this demo-product was ready they began meeting SMEs whom they thought could be
their customers. By the end of their first demo, they realized that the fragmented market
coupled with reluctance to pay might be difficult to make it a viable market to pursue in the
long run they would need to perform a customer pivot to survive in the long term. An
additional realization dawned on them in the hardware front they had heavily discounted
the potential requirement of hardware on which they were to install their platform and also
the support services that would need to be provided to the customers. Clearly the way they
were approaching the market had to change.
The Customer Pivot:
A customer pivot to focusing on the larger enterprises means changes on two fronts - their
product would also have to be fine tuned and made more robust. On the hardware and
services front, they would need to actively pursue alliance partner who could not just
complement the software offering but really make the ecosystem work towards making any
commercial deal possible.
They began activating their immediate contact list in the incubator to seek potential alliance
relationship with System Integrators (SIs). A typical SI partnership would begin with a round
of discussion on the product potential, a Proof of Concept and then the SI would take them to
136
a lead. They found that most small SIs didnt understand the potential of IVTs platform and
often took them to SMEs itself! This exposure to SMEs reiterated the learning IVT had
obtained earlier SMEs is not their market.
The team decided to take it upon themselves to focus on large customer, and attempted this
on their own the founders now decided to check back on BS where AS had spoken
already.
Back at BS:
After nearly 8 months since he had first met the CIO of BS regarding the IT infrastructure
management solution they intended to develop, AS reinitiated the discussion. Requesting
an appointment, he met Mr RN at his office in BS. The founders pitched both the VDI and
the private cloud solution.
From their conversation with the CIO, they felt that the VDI solution seemed to have caught
his attention more than the entire private cloud solution itself. They decided to make this their
strong hold for the offering to BS. After a few weeks of internal deliberation, BS asked for a
Proof of concept of the VDI solution.
The signs seemed positive from BS in that they had made some progress if this deal was to
come through it would be a largest customer win for IVT, giving them both credibility and a
marquee client to push their products in other locations.
IVT was given 2 months time to demonstrate the proof of concept, and the results of the
usage impressed BS. BS felt the solution suits their needs. Clearly, the OpenStack on which
IVTs EnCloudEn Platform was built had played well the credibility and international
acceptance made a high-level IT decision easier to evaluate.
Thought the VDI solution was impressive; could IVT really deliver everything that was
promised? With start-ups, challenges present themselves from every side would the service
be reliable at all? What if something went wrong BS had to make a choice and a start-up is
definitely a serious liability.
The CIO of BS wondered if it was possible to get the best of both worlds A large brand
name which would help get credibility and surety of delivery, yet have the advantage of cost
and technology that IVT provides. He thought it would be good if this was the case and
decided to connect IIPM with IVT.
IIPM and IVT:
IIPM is one of the worlds largest organizations offering solutions support to some of the
largest businesses in the world. IIPM has also been a major player in the System Integrator
space and has a dedicated Account Manager (AM) who interacts with clients to identify
137
potential requirements that the firms have and look to deliver the same from IIPM. BS
however, wasnt yet a client to IIPM, and so there was no dedicated AM. It was only the
Business Development (BD) team that was working hard to make this a client.
S had joined IIPM in 2013, but there were attempts by earlier BD team members to reach
out to IIPM. He decided to explore some potential engagements and was developing the
relationships with CIO of BS. IIPM was already in touch with BS for more than a year and
half and felt there was enough potential for a good deal.
When BS asked them to get in touch with IVT, other competing SIs had already pitched in
with Citrix based VDI solution. BS had evaluated EnCloudEns VDI solution and was
comfortable with the solution that was being offered. It was now up to IIPM to see if the deal
could be structured to capitalize on the potential opportunity.
S along with the IIPM team decided to visit IVT at N to perform a technical evaluation by
the delivery team. Once the product was implemented at BS, it was completely in the hands
of delivery team and ensuring that IVTs product is given a green signal by Delivery team
was quintessential to even consider getting into the alliance at all.
Having inspected the product, the delivery team gave a green signal and now the case for an
alliance had to be built internally at IIPM. It was at this stage that the IIPM Alliance team
would have to be involved for long term collaboration. IVT had an impressive technology,
and combined with the lower price point this could be a killer combination to beat the
existing players! It all hinged on whether IVT could delivery what was promised to BS!
IIPMs Alliance team generally operates with the rather well known and quick brand-recall
vendors in the market like the HP, Dell, and Oracle etc where the push from the customer
would be much higher. This was a case where the returns from BS could make the complete
offering by alliance would be attractive.
Sensing that BS liked the product and it was really a decision on the economic benefits that
the deal would swing either in their favour or not, both IIPM and IVT had to offer an
acceptable price for the solution. S corresponded with AS detailing the financials that
would make IIPM interested in the deal, and AS had to get back with the price that he
would be seeking on the software element. With one week of back and forth discussions, the
two parties jointly pitched the solution with a business case to BS.
As S sensed a comfort level working with AS and the IVT team, he and his team began
getting involved with the deal more actively. S engaged the BS team on an ongoing basis
and also developed a liking towards the entrepreneurial team at IVT. S had nursed a desire
to venture into the entrepreneurial journey sometime in life and understanding how
138
entrepreneurs work at close quarters through the alliance was interesting to him and selffulfilling in many ways. In addition to updating the progress of the deal on an ongoing basis,
he was also connecting with AS at a personal level his casual conversations often referred
to how AS and SP had taken up the entrepreneurial leap of faith, typical challenges they
had faced etc.
While the business case governed the alliance decision, the personal connect with the
entrepreneurs helped S gain enormous learning at a personal level. For the start-up team at
IVT, working with a large client helped understand how to handle the large accounts which if
at all would come in with large volume business.
S also decided to take the IVT team to a couple of client locations where they could
potentially pitch together. These could be next few opportunities that IVT could look out for.
Hearing back from BS
BS took a long time to evaluate the various proposals and revert with their choice in fact it
took over a year and half to offer the deal to IIPM. It was now a win-win to both the partners.
IVT swung into action and worked towards getting the product implementation in line to roll
out the commercially ready product. BS had offered 2 months for the rollout; however IVT
was extremely enthused about the potential of their first large client and delivered the product
in just over a month! This was followed by some basis on the job training to the IIPM
members who would be working on an ongoing basis on the client premise.
S in the mean time put down his papers and decided to take up the entrepreneurial leap on
his own. The product was now in the hands of the Delivery team. AS began interacting
with Mr Majunath the delivery manager.
As the software was deployed for commercial use, the contractual deal between IIPM and
IVT was still not done! AS was left wondering how he could get the contract in place
would he have to interact and get more out of the deal. Would the potential connect that S
made fructify into more deals? AS realized he had postponed putting the contracting
flavour to the deal a bit too late; S felt it was just a formality and would only be a matter of
time that IVT could formally call itself IIPMs partner.
--- End of Case ---
Applicability of the framework suggested by Salk and Vora (2006) for study of
alliances:
139
The above case fits extremely well with the framework Salk and Vora (2006) offered as a
candidate to analyze Strategic Alliances based on their literature review.
get him to adjust to any change that would be imposed on him. As an example; when S left
the firm to start up his own venture, AS had to develop a relationship with the new set of
team members from IIPM who would take the deal forward.
Development of Trust from Mistrusts/Distrust: In the current case, we could use social
networks and relationships to understand how the alliance between IIPM and IVT was forged
quite quickly. In the Trust/Distrust framework proposed by Kimber and Raghunath (2001)
posit the trust is alliance relationship begins with the bedrock of no trust or distrust;
however in this case the connection made by the CIO played a significant role to speed up the
process. It seems to have graduated to the Ex-ante phase where the reputation of the parties
and market complementarities (more so on assets front than on markets) and the Commitment
towards the goal of winning the deal (both were aspiring towards making BS a customer)
plays a major role. The Alliance managers involved in this phase had to invest time in
establishing the relationship phase (Glue Phase); the outcome of the this alliance depends on
how the two partners no perform their roles and build the trust further and eventually acquire
a greater market share.
Informal and Formal Networks: We could look at the use of Informal networks at two
distict points in the case (a) when AS decided to inform the VP about this entrepreneurial
journey choice and (b) when S who was in-charge of business development built the case
for the alliance with IVT.
When AS informed the VP at BS about his choice and the technology business he was
venturing into, the VP immediately put in a word with the CIO. This helped AS get a good
hearing from the CIO. Though the AS didnt have the complete product idea, the idea that
the product was in the space that BS was interested in helped keep the interest live. AS was
able to reopen up the conversation when he wanted to at a later stage. The VP in this case was
the actor that played the role of bridging structural holes and creating the first opportunity for
IVT.
S was the Business Development representative from IIPM pursuing a potential deal with
BS. S is from Kerala and so is Mr. RN, this demographic connect might have build a
personal connect between the two people. It was possibly this personal connect that initiated
the CIO to connect him (IIPM) with AS (IVT) instead of any other SI. Here again the VP
played the role of bridging the gap.
Once the connect with IVT was made, S played the role of an alliance champion from
IIPM and got the delivery team to meet IVT and try their product. Once the delivery team
was comfortable with the product, and he already had the comfort of BS on IVTs capability;
142
he could build the case for an alliance between IVT and IIPM. An alliance between a start-up
and a giant like IIPM is rare and it has materialized only due to the energy that S had
poured into realizing it. S employed both the formal and informal organizational
perspectives (Soda and Zaheer, 2012) to achieve what he attempted to achieve.
Bridging Structural Holes: From the context of the startup firm, the resources commitment
by the larger firm help them bridge the large structural holes (especially given that the
founders were novices to the industry in this context), by committing the resources and
offering credibility and legitimacy.
In the context of this alliance, both AS and SP were not from the infrastructure
management industry and had few connects of means of connecting with the larger
companies or the CIOs of many companies. Alliances were thus seen by them as the way out
of the deadlock they were in.
IIPM on the other hand through its dedicated set of experienced sales/business development
managers could afford to not just open up the doors for IVT, but also offer services bundled
with the solution and push their own profits higher.
Paradigmatic changes: The consumers seem to be increasingly gearing up to the new
paradigm of cloud and seeking a better return on their investments through better
management of their IT infrastructure. In this context VDI is an impressive improvement.
In the current case, most of the existing solutions offering VDI are from proprietary vendors
like Citrix or VMWare. These companies have built the complete cloud stack themselves and
have then customized the VDI solutions to suit the offering. Clearly the pre-paradigmatic
phase (Teece 1986) for VDI acceptance seems to have been crosses and IVT is entering at the
point when the industry is entering the paradigmatic phase (Teece 1986).
IVT on the other hand, is a relatively new entrant and is arguably the first companies to build
the VDI solution on openstack which has been backed by the larger players in the market.
The complementary assets given by IIPM seem to ease this process, while the opersource
based OpenStack offers the generic capabilities required for the innovation from IVT to
propagate.
IIPM though its alliance with IVT would be able to quickly offer the same quality product to
the customers with the added advantage of lower price and also the open source credibility.
The investment required from IIPM is extremely less in this context and the Time required to
position itself with respect to its competition is short, hence IIPM seems to have pushed
towards taking IVT and engaging with other companies quickly (Refer to the optimum
investment for business in question framework of Teece, 1986).
143
Workflow and Contracts: Coordination costs are one of the major concerns when one is to
decide on the alliance structure (Gulati & Singh, 1998). The workflow was predominantly
sequential, and occasionally pooled. Thus the type of governance format chosen was a
contractual agreement.
IVT is to set up the software and test initial working and then hand it over to the IIPM
delivery members who would be stationed at BSs premise to offer continued support. It is
only in case of major technical problems that IVT would have to be involved for technical
support. This sequential structuring would be completely operated by the contractual model
and hence the choice.
Transaction Cost Economics: Behavioural Uncertainty and the inability to write complete
Contracts (Williamson, 1985) been the subject if Transaction Cost Economics (Gulati &
Singh, 1998). The need for such a perspective is further compounded by exogenous shocks
and would require partners to adapt (Williamson, 1991). We see this aspect reflected in the
dilemma that IIPM faced when dealing with BS, and how the contract with IVT strengthened
its possibility of winning the deal.
IIPM had been in talks with BS to provide hardware for the private cloud that it was
planning; however it had already lost the deal to HP hardware. IIPM seem to have already
sunk in nearly 2 years of effort towards building a relationship with BS and it was keen on
creating a strong case for the VDI solution.
Other competitive SIs had proposed the more established but proprietary Citrix and VMWare
solutions of offer. IVT had approached BS directly and had a favourable mind space of the
CIO. When the BS CIO connected IIPM to IVT, the quick check on the delivery level
comfort about the product would help gain an upper hand in the deal, by reducing the
behavioural uncertainty from BS.
To reduce the uncertainty emerging from price point, the internal transparency shown
between IIPM and IVT, coupled with the openness and adaptability of the two partners
helped offer a joint deal. In addition to this, IIPM had not gotten into an agreement with IVT
before they had themself got the deal from IIPM.
This set of instances, indicate the applicability of TCE to understand how business partners
use the TCE logic negotiate uncertainty in their business dealing.
Learning Theory:
Being a start-up and working with a firm as large as IIPM, for the first time; IVT is
developing an understanding of the underlying processes and teams that the larger players
144
have at their disposal. As IVT begins seriously considering partnering with other larger
players this learning would be of immense assistance
The above section on looking at the various activities/stages of the case of alliance formation
from the various lenses didnt just help enrich the understanding of the case, but also
validated the applicability of the lenses in the context of two differently sized organizations
working in an alliance.
From the perspective of a start-up, we could take away the following lessons regarding
navigating the business. On the consumer front, the start-up could benefit from uniqueness of
the product, knowing their competitors and their offerings, and what would be the primary
consideration of the consumer. Developing relationships with the customer could also help
them seek potential cooperative partnerships.
On the Partners front, the start-up could work towards developing a comfort level with the
alliance manager. If the start-up has already developed a sense of comfort to the customer,
this should have a positive rub-off on the alliance. They should also work towards creating a
comfort level for the delivery team of the partner.
The above mentioned inputs could help the start-up develop a positive orientation towards
forming an alliance successfully.
Conclusions
In the highly competitive technology sphere, alliances with larger-established firms give the
start-ups a strong means of overcoming the liability of smallness and newness which
invariably haunt the new venture firms. Though the study of the cases of a successful alliance
formation between IVT and IIPM, I have attempted to distil some key implications for startups. The case has also been analyzed from different lenses to study the alliance relationship
formation.
Reference:
145
146
J. KRITHIKA,
ASST. PROFESSOR, DEPARTMENT OF MBA, SVIT
Entrepreneur is a person who shifts economic resources in such a way which yields higher
productivity. Entrepreneurship is not a trait, but it is all about do something better in different
way. Innovation can be defined simply as, a new way of doing something. It may refer to
incremental, radical and revolutionary changes in thinking, products, processes or
organizations. Innovation can be treated as a combination of risk taking and creativity of an
entrepreneur. The role of an entrepreneur and the growth of the country are inseparable. The
importance of the innovation can be viewed as a success of an entrepreneur.
(Wealth and employment)
Entrepreneurship
Innovation
(New business ideas, products and process)
147
K.VIKRAM
M.COM., MBA(IB).,MBA(IRM).,PGDHRM.,D.EF.,M.PHIL.,(PHD).,MIMA
ASSISTANT PROFESSOR IN COMMERCE & MANAGEMENT
LAL BAHADUR SHASTRI GOVERNMENT FIRST GRADE COLLEGE
DINNUR MAIN ROAD, R.T.NAGAR, BANGALORE -32
ABSTRACT
148
3 INFORMATION
EDUCATION
(ICT)
HAVE BECOME
IS A VERY SOCIALLY
RECENT
EDUCATION
AN
DEVELOPMENT
IMPORTANT
OF
CONTRIBUTION
TEACHERS
ABILITIES
OF
TO
TEACHER
EXAMINE
EDUCATION
TEACHING
IS
FROM
ITS
THE
4 IT
TRAINING GRADUATES
AND
TEACHER EDUCATORS
COMMUNICATION TECHNOLOGY
OUTCOMES
(ICTS),
AND
INFORMATION
BUT
ICT
IMPORTANT AND THIS IMPORTANCE WILL CONTINUE TO GROW AND DEVELOP IN THE
21ST CENTURY.
INTRODUCTION
The computers has been documented as influencing classroom use of computers (Becker
1999; Becker, Ravitz &Wong, 1999; Charania & Shelley, 2007), it is not a sufficient factor for use. The
World Bank study (2011) suggested that merely putting computers in schools and training teachers
to use them will not improve the learning levels in students. A two year study conducted by the
World Bank (2011 One of the obvious reasons for this as explained in the study was that the
computers in the schools were used to learn computer systems and applications with no plan and
efforts to integrate it with the teaching and learning in the classroom. This argument is also
consistent with Koehler and Mishra (2009)
149
1. ACQUISITION, STORAGE,
MANIPULATION,
MANAGEMENT,
USES IN EDUCATION
150
TRANSMISSION
OR
ICT is being utilized in every part of life. Due to the increasing importance of the computer,
students-the future citizens cannot afford to keep themselves aloof from this potential medium. In
education, use of ICT has become imperative to improve the efficiency and effectiveness at all levels
and in both formal and non-formal settings. Education even at school stage has to provide computer
instruction. Profound technical knowledge and positive attitude towards this technology are the
essential prerequisites for the successful citizens of the coming decades.
Quick access to information : Information can be accessed in seconds by connecting to the internet
and surfing through Web pages.
151
Easy availability of updated data: Sitting at home or at any comfortable place the desired
information can be accessed easily. This helps the students to learn the updated content. Teachers
too can keep themselves abreast of the latest teaching learning strategies and related technologies.
152
Application of latest ICT in education has provided many options to the learners to opt for
the course of their choices. Many Online courses are available for them to select any as per their
aptitude and interest. Students can evaluate their own progress through different quizzes, ready to
use Online tests. This can ensure fulfillment of the employment required in the job market thus
minimizing the problem of unemployment. It can also provide more efficient and effective citizens to
the society as per the changing needs.
CONCLUSION
In order to conclude we will try to proceed to synthesize from a general viewpoint the
results obtained, taking into consideration the relevant aspects of the literature. The results
provided by both the quantitative and qualitative analysis of the literature obtained will be exposed
especially regarding those aspects which are related to ICTs for Education and ICTs in Education. ICTs
for education refers to the development of information and communications technology specifically
for teaching/learning purposes, while the ICTs in education involves the adoption of general
components of information and communication technologies in the teaching learning process.
References
1. UNESCO (2002) Information and Communication Technology in EducationA Curriculum for
Schools and Programme for Teacher Development. Paris: UNESCO.
2. UNESCO,(2002),'Open And Distance Learning Trends, Policy And Strategy Considerations',14
UNESCO.
3. Becker, H. (1999). Internet use by teachers: Conditions of professional use and teacher directed
student use. Teaching, learning, & computing: National survey (report no.1). Center for Research
on Information Technology & Organizations, Irvine, CA:
California University, Irvine. (ERIC Document Reproduction Service No. ED429564).
4. Becker, H., Ravitz, J., & Wong, Y. (1999). Teacher and teacher-directed student use of computers
and software. Teaching, learning, and computing: 1998 national survey (report no. 3). Center for
Research on Information Technology & Organizations, University of California, Irvine and University
of Minnesota. (ERIC Document Reproduction Service No.ED437927).
153
INTRODUCTION
E-Marketing is now a days success mantra of each and every business concerns whether it is
of any form, any nature, any size, national or international and so on. Now days, E-Marketing
has become a hot and new option with explosive development of Internet. It became a reality
only with the development of World Wide Web and many other related and associated
technologies. E-Marketing is a web system with high availability, sufficient capacity and
satisfactory performance which reduces the cost of doing business, improving quality
product, bridging the gap to reach to customers or suppliers and creating new routes for
selling of existing products and establishing platforms for upcoming products for existing and
as well as potential customers.
E-Marketing describes any companys or any institutions efforts to inform the buyers,
communicates, promotes and sells its products and services over the internet which is having
a profound impact on the functioning of the business world. The application of E-Marketing
in the development of economy like India has resulted in a paradigm shift in the business
practices. E-Marketing today has become an important sale and marketing force, it is the
latest concept which helps to develop competitive edge and its creating new waves and
redefining the business frontiers in relation to challenges and changing with advancement in
information technology and to make ones presence felt in the national and international
markets as well as businesses.
Participation in E-Marketing is certainly the key word of success at present and as well as in
future also, as E-Marketing adds a whole new element to the concept of marketing mix
through cost effectiveness and its flexible nature which produces great results to search out
the markets and carryout various promotional activities targeted towards the optimum share
of market through access the mass market at an affordable price and maximum satisfaction of
consumers with truly a personalized marketing approach.
By the end of first and start of second decade, millions of corporate and individuals are
buying, selling, bidding, brokering, advertising, promoting and collaborating on a daily basis
as the internet mergers with the other branches of Information Technology.
E-Marketing is also known as Internet Marketing, Online Marketing, Web Marketing, and
Cyber Marketing, here E means electronic that has its marketing process through the use of
electronic communication technology. A concerted interaction of various form of online
advertising options, all these are the hallmarks of E-Marketing concepts.
154
DEFINITION OF E-MARKETING:Here are some of the definitions of E-Marketing by different organizations and renowned
personalities,
The definition suggested by E.COM, E-Marketing supports an entire range of activities such
as product design, manufacturing, advertising, commercial transactions, settlement of a
accounts using a variety of computer network.
According to Zwass, The sharing of business information, maintaining business
relationships and conducting business transactions by means of telecommunication
networks.
According to L.M. Applegate, E-Marketing is more than simply buying and selling of goods
electronically, it involves using network communication technology to engage range of
activities up and down the value added chain, both within and outside the organization.
According to OECD, E-Marketing refers to generally to all the forms of transactions related
to commercial activities including both organizations and individuals that are based upon the
processing and transmission of digitized data including text, sound and visual images.
According to Garter Group, E. Commerce is an electronic communication among enterprises,
including customers, suppliers, business partners, government organizations, and financial
institutions.
From the definitions, it is evident that E-Marketing involves the paperless exchange of
business information facilitated by the application of electronic data interchange, electronic
mail, electronic bulletin board, electronic funds transfers and other network based
technologies. It not only automates manual process and paper transaction but also helps
organizations move to a fully electronic environment and change the mode of their
operations.
SCOPE OF E-MARKETING:India is uniquely positioned and it has to start from the scratch, there is a need to develop
high speed, long distance between backbone networks that will interconnect the entire world
at one point. The existing business rules need to undergo a radical change and new business
strategies have to be evolved. The government of India has to formulate some guidelines to
make it more applicable and implacable.
In the words of N. Vittal, Chief Vigilance Commissioner of India, E. Business is a goose
that can lay eggs. Allow the goose to egg laying stage. Dont kill it. According to him, there
are need of six Cs for e. business to grow in India, namely, computer density, connectivity,
content, cyber law, cost control and common sense.
In the next few years, experts expect that world and the world of marketing in particular to be
entirely transformed by the yet to be realized potential of E-Marketing. Now-a-days,
Information technology based business operations are becoming the standard of the business
world. Information technology and business/commercial activities have never been as closely
related as it is now. Today, this relationship is not only defining new organization, products
and services and ways of satisfying the existing consumers, rather it is exploring newer ways
155
to access the need of customers and innovative ways to segment the market and satisfy them
also.
Basically, E-Marketing provides a magnificent platform of opportunities for change and
improvements in each and every activity of business through Innovation, which is all about
doing things differently, exploiting ideas, implementing these ideas to capture the attention
and attraction of present and potential customers in so many ways and means.
STEPS OF E-MARKETING:Most of the companies are wishing to go online to tap the growing segment of consumers
who buy goods and services through the web. E-Marketing deals are built in almost five
steps, which are as follows:
1. Presence on the Web-- Organization and product information is to be put on the net
using a website. This is the gateway to internet trade or e. commerce.
2. Massaging and Publishing-- To disseminate and exchange fast changing
information, a massaging and publishing facility has to be implemented. This will also
help to get customer feedback on your product and improve customer service.
3. Collaboration within the Organization-- The entire organizations workflow has
to be automated to reduce the cycle time for reaching the customer, interaction and
feedback, which can be achieved through Intranet.
4. Transaction with Suppliers-- Purchases and payment processes of suppliers need to
be automated, which can be fulfilled by connecting all the vendor of your
organization to an Extranet.
5. Transaction with Customers-- Automation of payment system and service support
need to be implemented, which has to be linked to the companys intent to realize the
full potential of e. commerce benefits.
SPECIFIC BENEFITS OF E-MARKETING:E-Marketing has a number of specific benefits; some of them are as under:
1. Global Reach-- A website can reach anyone in the world who has internet access.
2. Lower Cost-- A properly planned and effectively targeted E-Marketing campaign can
reach the right customers at a much lower cost.
3. 24hours Marketing-- With a website, customers can find out about the products even
when the office is closed.
4. Personalization-- If customers database is linked with the company website, and then
whenever someone visits the sites, company can greet them with targeted offers.
156
5. One to one Marketing-- E-Marketing lets reach people who want to know about
products and services instantly. This particular benefit when associated with personalization
then E-Marketing can create very powerful targeted campaigns.
6. Better Conversion Rate-- When company has a website, and then customers are only a
few clicks away from completing a purchase, so E-Marketing is seamless.
OBJECTIVES OF E-MARKETING:E-Marketing has a number of objectives to be achieved as a new and emerging instrument of
the current marketing techniques, out of which some of the basic objectives are as follows:
1. Sell-- Using information technology to sell the products and services at large but
cheap prices.
2. Serve-- Using the electronic techniques to serve the customers at optimum level.
3. Speak-- Using the telecommunication networks to communicate with the customers
(both present and potential).
4. Save-- Using the various electronic devices and facilities for saving the time and
reducing the cost.
5. Sizzle-- Using information technology and various devices to build the brand identity.
VAST OPPORTUNITIES OF E-MARKETING:E-Marketing has very vast and tremendous opportunities for its various parties including
buyer, seller, intermediaries, advertisers, customers and many more. Some of the main
opportunities are enunciated as follows:
1. Internationally more than 33% of surfers buy the products and services online.
2. E-Marketing reduces prices through automation and use of electronic media.
3. E-Marketing increased exposure of products and services in front of the present and as
well as potential buyers.
4. E-Marketing facilitates the numerous and unlimited needs, wants and desires of number
of present and future customers.
5. E-Marketing has a boundless universal accessibility with some rules, regulations and
guidelines which are must be followed by all the concerned parties.
6. E-Marketing is ornamented with affordable electronic devices and internet connectivity
globally.
7. E-Marketing through its various unique characteristics has a very huge potential for all
round development and growth.
TYPES OF E-MARKETING:E-Marketing is mainly done by four types, namely, Content Marketing, Social Media
Marketing, Search Engine Marketing and Email Marketing, a short description of all these
types are as under:
157
CONCLUSION:In nut shell, can say that E-Marketing is the need of todays marketing canvas to acquire a
good large number of customers to attract and retain for the survival, development and
growth of the business, commerce, industry and trade to gain competitive edge over the other
competitors. To cope up with all the changes and challenges, E-Marketing is the essential
instrument which performs undoubtly an important role to touch each and every human
beings and their all tunes and tones to direct and redirect all the related activities which are
associated with it. In connection to this, parties associated must have to develop skills,
158
competencies and excellence in E-Marketing and its related activities to win the battle which
is really heated up.
References:Books:
1.
2.
Journals:
1.
Websites:
1.
2.
3.
4.
http:/www.marketinginindia.com
http:/www.indianmarketing.com
http:/www.tradekey.com
http:/www.allbusiness.com
ByMrs. Urvashi Tandon
M.Phil., NET.
Research Scholar:
Department Of Commerce,
Mahatma Gandhi Kashi Vidyapith, Varanasi .
159
BHAGYA LAKSHMI. K
ASSISTANT PROFESSOR, DEPARTMENT OF MANAGEMENT STUDIES
AFFILIATION: DON BOSCO INSTITUTE OF TECHNOLOGY, VTU
ABSTRACT
Technology is impacting us all, with devices becoming increasingly portable and fast, we can
now access our work almost everywhere, seemingly only dependant on wifi connection. The
rapid spread of computer and telecommunication technologies throughout the work has
forced us to consider the impact of these technologies on the people who use them directly
and on the work force as a whole. This study focuses on the impact of technology such as
personal computers, telecommunication technologies, and other aspects of Information and
Communication Technology (ICT) on employees and leaders work expectations and how
these impact on work life balance, specifically within the multinational companies (MNCs).
Despite the employer introducing flexible work arrangements, an increase in workload
demands with little or no additional financial or human resources presents challenges to
addressing work life balance issues.
Advancements in technology can therefore both help and hinder attempts to provide
employees with the support they need in ensuring a healthy work environment. The raised
expectations for both employees and employers in achieving goals and objectives and
160
meeting often unreasonable deadlines may result in increased pressure on other employees
within the organization. This may have an effect on employees health, resulting in higher
absenteeism, lower productivity, and higher turnover rates.
In order to explore the impact of technology might have on work-life balance, the author
interviewed employees of multinational companies and considered their words to found the
level of impact the technology plays on employees work life balance. Interview responses
consisting of quantitative data were compiled and analyzed. The author tried to capture and
project a real account of the comments and real challenges technology brings to the
participants
The review also gave consideration to extenuating factors such as workload issues which
could reasonably be thought of as contributing to increased pressures. Both positive and
negative impacts on work demands and stress were shared. Recommendations from the
respondents for improving work-life balance are incorporated into this report and these will
be brought forward for suggested implementation.
Keywords: quality of work life, stress, multinational companies
INTRODUCTION
The work life balance was first used in the late 1970s to describe the balance between an
individuals work and personal life. Work life balance can be defined as the perfect
integration between work and life both not interfering with each other. According to Julie
Morgenstern Work life balance is not about the amount of time you spend working vs. not
working. Its more about how you spend your time working and relaxing, recognizing that
what you do in one fuels your energy for the other.
The concept of work-life balance (WLB) is not a new but with the changing pace of life and
increase in stress levels, negatively affecting the quality of work, has made many organizations think
about the strategies for maintaining a work life balance. A group of workforces that is greatly
affected by the quality of work life as a result of dynamic changes in work life balance of
employees is specifically women employees working in organized sector.
161
According to Julie Morgenstern Work life balance is not about the amount of time you
spend working vs. not working. Its more about how you spend your time working and
relaxing, recognizing that what you do in one fuels your energy for the other.
SCOPE AND LIMITATIONS
The scope of the project was limited to the team members of the Multinational companies.
This population was sampled with a response rate of 100%, although the sampling size of
thirty participants was small. Nevertheless, data and information have provided important
insights on how each are affected by technology.
Employees may feel somewhat apprehensive in sharing factual information for fear of
divulging exactly how much time they spend on work-related issues, therefore the data can
be either over-inflated or under-inflated.
162
RESEARCH METHODOLOGY
TYPE OF RESEARCH
This study is primarily a qualitative research study with the exception of questions based on
the objectives. The questionnaires consisted of 15 questions and were distributed to the
respondents. The two Multi National Companies was selected DELOITTE and CGI, where as
respondents selected on random basis. The questionnaires were distributed through E-mail
and a week time was given to them to revert back the form. And the collected data was
analyzed and tabulated to find the responses given by the respondents.
Sampling size:
The sampling size consisted of employees of
163
Work life does not merely means the facilities provided to the employees during office hours.
It comprises of all the collective feelings, which reside in the mind of the employee while he
works in the organization, he is in the office or away from it.
Meaning
According to Julie Morgenstern Work life balance is not about the amount of time you
spend working vs. not working. Its more about how you spend your time working and
relaxing, recognizing that what you do in one fuels your energy for the other.
Definition
Work Life Balance is a persons control over the responsibilities between her/his workplace,
family, friends and self. It is recognized that technology has an impact on the control an
employee may or may not have with such responsibilities. Not all employees use the same
technology nor do they all their equivalent.
COMPANY PROFILE
Deloitte Touche Tohmatsu Limited commonly referred to as Deloitte, is a British
multinational professional services firm headquartered in New York City in the United States.
Deloitte is one of the "Big Four" and the largest professional services network in the world by
revenue in FY2014 and the largest by the number of professionals. Deloitte provides audit,
tax, consulting, enterprise risk and financial advisory services with more than 225,400
professionals in over 150 countries. The company currently has a total of 46 global member
firms and in FY 2015, earned a record $35.2 billion USD in revenues.
CGI Group
CGI Group Inc., Conseillers en gestion et informatique more commonly known as CGI, is a
global information technology (IT) consulting, systems integration, outsourcing, and
solutions company headquartered in Montreal, Canada. Founded in 1976 by Serge Godin and
Andr Imbeau as an IT consulting firm, the company soon began branching into new markets
and acquiring other companies. CGI went public in 1986 with a primary listing on the
Toronto Stock Exchange.
164
Sl. No.
Particulars
% of Respondents
0 1 year
40%
1 2 year
2 3 year
23%
3 4 year
36.3%
Total
100
Data Analysis
Table: 1.1 How long you have worked for the company
Graph: 2.1
Number of years you have worked for the company
40%
35%
30%
25%
20%
15%
10%
5%
0%
0 1 year
1 2 year
2 3 year
3 4 year
5 & more
years
Analysis: The above table shows that 40% of respondents are working from 1 year and 23%
of them are working from 2 years and 36.3% of them are working from past 5 years.
165
Interpretation: The above graph shows that the maximum number of respondents are
Sl. No.
Particulars
% of Respondents
Laptop
60%
Desktop
Mobiles
23%
Tablets
16.6%
Others
Total
100
working from past 2 and more years this shows the employee stability in the company.
Table 1.2 What type of technological devices the company provides you for the work
Graph: 2.2
Type of technological devices the company provides you for the work
60%
23%
16.60%
0
Laptop
1
Desktop
2
0
Mobiles
3
Tablets
4
Others
5
Analysis: The organization provides various types of devices for its employees to fulfill their
work. Some of the device they give to the employees are laptop, mobiles and tablets.
Interpretation: The maximum number of respondents are working in the organization by
using laptop.
166
Table: 1.3 Do you feel the mental and physical health has been affected by the use of
Sl. No.
Particulars
% of Respondents
Sl. No.
Particulars
% of Respondents
Yes
76.6%
No
23.3%
Total
100
technology
Graph: 2.3
Is technology affecting the employees physical and mental
health
Yes
No
23%
77%
Analysis: The above table shows that 77% of respondents feel that the mental and physical
health of the respondents has been affected by using the technology at their work and 23% of
them disagree with the above statement.
.Interpretation: The employees health is been affected due to use of technology in their
working life. Various health issues like headache, viral infections from tablets, physical stress
through carrying laptop, mental stress, eye sight problems etc,. are impacting the personal life
of employees where usally these common problems is acting as a factor to balance their
personal and professional life.
Table: 1.4 Whether the technology you use in the work is helping you to reduce stress
167
Strongly agree
Agree
80%
Sl.
3 No.
Particulars
Neutral
% of Respondents
20%
Strongly disagree
Disagree
Total
100
Graph: 2. 4
20%
0
Strongly agree
Agree
Neutral
Strongly disagree
Disagree
Analysis: 80% of respondents feel that they reduce their stress from the technology they use
in their work.
.Interpretation: The employees undergo stress due to their work load. The technology they
use in their work reduces the level of strees.
Table: 1.5 Have you ever checked a message either on your mobile or home work e-mail
after 5 p.m.? before the start of your work day? If yes how often
168
On average hourly
40%
2 Sl. No. On
average daily
Particulars
0% of Respondents
Once a week
23%
Twice a week
36.3%
Total
100
Graph: 2.5
Have you ever worked at home even after your working hours
45%
40%
35%
30%
25%
20%
15%
10%
5%
0%
On average hourly On average daily
1
Once a week
Twice a week
Analysis: The employees also extend their working hours, 40% of respondents do the
extention on hourly basis, 23% of them on weekly basis and 36% of them on do more than
twice in a month.
Interpretation: The organization expects the employees to extend their working hours. This
directly impacts on employees personal life where this makes the employees to fail in
balancing their personal and professional life.
Table: 1.6 Do you ever browse or use the e-marketing websites at your work time
169
Daily
Rarely
73.3%
Often
10%
Very often
16.6%
None
Total
100
Graph: 2.6
16.60%
10%
0
Daily
0
Rarely
Often
Very often
None
Analysis: The employees browse some of the e-marketing sites at their work time.73.3% of
respondents agree with the statement and they rarely use it and where 2606% of them use it
often.
Interpretation: The employees use some of the e-marketing sites at their work time that
gives them some break from their work and it also help them to complete some of their
personal work as now a days online marketing has gaining its vital importance in customers
purchases and this sites supports the employees to balance their work and personal life.
FINDINGS:
170
Majority of the employees are working from 1 year and 23% of them are working
from 2 years and 36.3% of them are working from past 5 years.
Maximum number of employees agree that technology has a direct impact on worklife balance.
The employees are of opinion that the usage of technology in their work life has
affected their mental and physical life. They undergo with severe health issues like
headache, viral infections, eye sight problems, back pain etc,.
Many companies now a days are depended on technology where the addiction has
increased to that extent where now they cant even imagine their work without it. Most
of the companies provide some of the technological devices like laptop, desktop,
mobiles,tablets.
Employees continue their work even after their working hours. There are some
companies which expect the employees to work even after their working hours, to
support this they use the modern technologies.
Work from home benefit is utilized by many employees in the current scenario. Many
employees that are around 60% of them select this option because of self illness or
family members illness.
90% of respondents undergo stress because of their work demands from the
organization.
83% of the respondents check their company mail on a daily basis after their working
hours through the devices given by the companies. And any emergency work has to
be completed by employees even after their working hours that make them more
stress and here they fail to balance their work and personal life.
Meditation, yoga, travelling are some of the strategies the employees follow to reduce
their work stress.
Majority 80% of respondents find more advantages by using technology in work life.
Many respondents agree that the organization or management ask them to review and
respond to their e-mail and attachments send to them even after working hours.
The employees agree that very often they browse some of the e-marketing sites and
social networking sites during their work hours.
The respondents are of view that they find both pros and cons of using technology in
their work life.
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Advantages
The difference is that they now do not stay at work until 9 p.m. but continue
working at home.
Some individual commented that they enjoy working.
One commented that the Internet has supported a wave of work that did not exist
20 years ago. Much of the correspondence back and forth is not as effective.
Rather than meeting face-to-face and dealing with issues, staff are often
commenting in isolation which may not be the most productive method. There is a
far greater expectation placed on employees to contribute to planning and
providing feedback on documents which are not necessarily in their area of
expertise.
Technology allows for immediate and broader distribution of material for review
which may not have been required in the past. Our audience must be taken into
consideration.
Disadvantages
Employees access their work e-mail account on their personal device and almost they
respond to work e-mails outside of office hours.
Most say that the usage of technology in their work life has affected their mental and
physical life. They undergo with severe health issues like headache, viral infections,
eye sight problems, back pain etc,.
SUGGESTIONS
The employees find difficult to extend their working hours so it would be better if
companies to some extent avoid assigning the work after their regular working hours.
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It would be better if companies organize programs that help the employees to reduce
their stress level. Programs like yoga classes, meditation classes, games can be
conducted thet helps them to reduce their stress.
The employees are finding difficult to carry their laptop every time from work to
home it would be better if company follows any other alternative for it.
CONCLUSION
The research found that the use of mobile technology for both work and social
purposes is widespread and pervasive, and for our sample at least, the use of technology, and
the flexibility it offers, is generally viewed positively in terms of work/life balance and
wellbeing. Social media use at work was perceived as a stress-reliever, particularly amongst
the younger age group, and employers may benefit from considering this as a potential stress
management tool, given that some respondents clearly have found the advent of technology
to be a cause of stress in the past. It emerged from our research that a perception of having
control over technology use is a potential mediator of whether it is viewed primarily as a
positive or a negative.
Questionnaire
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9. Which of the strategies you use to reduce your stress. Rate the following from higher to
lower scales
10. Whether the technology you use in the work is helping you in reducing your work stress
11. Do you sometimes receive e-mails with large attachments and are expected to review and
respond within a certain timeframe? If so, how often?
12. Your opinion regarding the use of technology does it have more advantages or
disadvantages
13. Do you ever browse or use the e-marketing websites at your work time
14. How often you use the technologies for social purposes while at work
15. Your opinion regarding technology usage in your work life
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Dr.k.Ramachandra
PG Co-ordinator, Department of Commerce, Maharani Arts, Commerce and
Management College for women, Sheshadri road, Bangalore.
Jayaram. A
Research Scholar, Department of Commerce, BUB
Balaji. M
Research Scholar, Department of Commerce, BUB
Abstract
Reverse innovation is also called as trickle up innovations wherein inventions first happens or
seen in developing countries and subsequently adopted by developed countries. The term
reverse innovation is a buzz word in the modern competitive and knowledge oriented
economies of the world. The best example is TATA group of company innovations like
NANO, For instance Tata introduced the Tata Nano for the price conscious consumer in India
in 2009 and now Tata plans to launch Tata Nano in Europe and U.S. Subsequently the FMCG
products Kurkure and others, generating power through rice husk is few examples of reverse
innovation. In India the opportunities for innovations and creativity is limitless. The
indigenous technology and innovations received global acceptances. The least cost
innovations have profound effect on business, economy and society at large. Prof.Vijay
Govindarajan (Dart mouth University) coined the term and popularized the concept
worldwide. The reverse innovation is selling fast to the developed countries from developing
countries. This process has produced several benefits for both developing countries as well as
developed countries in terms of variety of goods at cheaper prices, rise in employment
opportunities, technology advancement etc. The present paper traverses through the leading
case studies and examples of reverse innovation of India and other developing countries. This
paper will go a long way in enlightening the readers all about reverse innovations business
models for excellence in the world trade era.
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Introduction:
Innovation is a key phenomenon in business world which is supposed to be the right of
developed countries because of their ability to undertake intensive research and development
work. Cameras, phones, computers etc. all are originated in developed countries and later on
flowed to developing countries as per their requirement and affordability. But, in present era,
innovations are gradually taking place in emerging countries and then replicated in developed
countries as per their demands. This is termed as reverse innovation. The concept is coined
by Vijay Govindarajan and Chris Trimble a world expert on strategy and innovation, Jeffrey
Immelt in 2009. The major drivers of this reverse flow of innovations from developing
countries to
developed countries are fast pace of internationalization in the world economy,slowing down
of rich countries and rising level of income and growth in emerging countries. Because of
these factors foreign MNCs prefer to develop the products as per the huge demand of
emerging economies and even undertaking the research and development activities in these
countries. This enables them to take the advantage of low cost and huge pool of human and
natural resources of these economies. Indian MNCs also, to take the advantage of
internationalization are making efforts to redesign theproducts according to the requirements
and conditions of the developed economies.This process has produced several benefits for
both developing countries as well as
Developed countries in terms of variety of goods at cheaper prices, rise in employment
opportunities, technology advancement etc. In this way Reverse Innovation has gradually
revolutionized the production pattern, consumption trends across the world.India has also
experienced the same benefits when its Indian MNEs adopted the Reverse Innovation
strategies as per the requirement of the different developed countries.
At this backdrop, the study aims to explore the gains of reverse innovation strategies in India.
For this purpose, different case studies of few successful companieshave been undertaken to
explain the benefits reaped by these companies in terms of their increased revenues, share
and positioning across the World.
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A reverse innovation is any innovation likely to be adopted first in the developing world. For
example, companies develop products in countries such as China and India, and then
distribute them globally. Globalization strategies assume that innovation has already
occurred, and that developing nations are in a slow and evolutionary process of catching up
with the rest of the richer world. They will import what the richer world develops as soon as
they can afford to do so. Globalization is the process that companies use to export modified
versions of global products originally developed for rich-world consumers.
Examples of Reverse Innovation:Tata Motors Tata Nano , GE GE MAC 800, Procter and
Gamble (P&G) Vicks Honey Cough Honey-based cold remedy, Nestle Low-cost, lowfat dried noodles, Hewlett-Packard (HP) Research Labs in India, Godrej Chotu kool
Refrigerator, Tata Swacch Worlds cheapest water purifier, Pepsico Kurkure and Aliva.
Indigenous Multinationals would instinctively raise their investments to build advanced R&D
facilities that would inspire cutting edge innovation and engineering. It also means the
engineers would experience higher employment opportunities, and the consumer market
would benefit from better products developed to cater to their needs at reasonable prices.
Besides OEMs, Reverse Innovation would also lead to the overall development of the entire
eco-system comprising of Tier I and II suppliers, technology vendors, educational institutions
which support, fortify and facilitate this unprecedented growth through concurrent
engineering, providing smart and agile engineering and production solutions to complex
challenges, and development of resources.
Reverse innovation is bringing the countries and global markets further closer by fading the
global borders to make one world, one market phenomenon a more reality. Reverse
innovation would provide further impetus to the globalisation while increasing the influence
of cross economic dependency and making cross border production and marketing viability
plausible and effective.
Review of literature:
Role of Reverse Innovation in Business: A Case of Few Companies Sonia Lohia1 and
RashmiTaneja- Multinationals innovated in rich countries and sold those products in poor
countries. Reverse innovation is doing just the opposite. It is about innovating in poor
countries and bringing those products to rich countries. In this way Reverse Innovation has
gradually revolutionised the production pattern, consumption trends across the world. India
has also experienced the same benefits when its Indian MNEs adopted the Reverse
Innovation strategies as per the requirement of the different developed countries.
From Cost to Frugal And Reverse Innovation: Marco B. Zeschky, Stephan Winterhalter, and
Oliver Gassmann (2014):Product and service innovations aimed at resource-constrained
customers in emerging markets have recently attracted much research and management
attention. Despite the prominence of this topic, however, there are some misconceptions
around the different innovation types in this domain that may limit managers ability to
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derive informed implications for strategy and operations. This article analyzes the different
types of resource-constrained innovationcost, good-enough, frugal, and reverse
innovationconceptualizes the distinctions between them, and discusses the implications for
strategy providing a framework for managers to systematically analyze their own approaches
to resource-constrained innovation and craft proper development processes.
IIT Bombay-Historically, multinationals innovated in rich countries and sold those products
in poor countries. Reverse innovation is doing exactly the opposite. It is about innovating in
poor countries and selling those products in rich countries. Since two-thirds of worlds
growth in GDP is likely come from poor countries, reverse innovation is an important
phenomenon. Reverse innovation is also a significant learning opportunity for students in
engineering. Engineering graduates are good at solving problems. Once given a problem,
they tackle it rigorously.But what if these individuals werent handed problems and instead
sought them out? Engineers have an opportunity to reframe the problem space and identify a
whole new set of problems if they ask this question: How do we engineer and design products
to solve the worlds toughest challenges.
Scope:
This is the reverse innovation study and limited to only Indian companies product. This
study is carried out to understand the benefits of reverse innovation and also to find the gap
that distinguishes emerging-market needs from familiar rich-world needs.
Methodology:
From the literature review it is very clear that very little research has been done in India. This
paper is conceptual in nature and the data was collected with the help of secondary sources
i.e., Books, Case studies, Research Articles, Journals, Newspapers, Internet and Magazines.
Finally we have analyzed Reverse innovations and paradigm shifts in business excellence.
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forgetting.You must let go of the dominant logic that has served you well in rich
countries.In fact, its best to assume that youve just landed on Mars
2. Reverse Innovation would lead to the overall development of the entire eco system
comprising of Tier I and II suppliers, technology vendors, educational institutions
which support, fortify and facilitate this unparalleled growth through concurrent
engineering, providing smart and agile engineering and production solutions to
complex challenges, and development of resources.
3. Reverse innovation is bringing the countries and global markets closer by Fading the
global borders to make one world, one market phenomenon amore reality. Reverse
innovation would provide further impetus to the globalisation while increasing the
influence of cross economic dependency and making cross border production and
marketing viability plausible and effective.
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4. Better products for consumers and a variety of options to choose from at reasonable
prices.
Performance Gap
Simply put, with fewer dollars in hand, buyers in the developing world are willing to
accept lower performance. This sounds simple enough, but it is not as straight forward
as it at first appears. Consider a typical good-better-best rich-world product line.
When global corporations headquartered in the rich world export to the developing
world, the tendency is to focus just on the good offering, or perhaps even to water
down the good offering a little bit further, from good to fair, to achieve the
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lowest possible price point.This seems sensible enough on the surface. The problem is
that a modest price cut say, 10 percent is not nearly enough to make a
difference to mainstream customers in the developing world, who may have only onetenth the income of buyers in the rich world. Such low incomes, however, do not
mean that developing world customers do not need innovative products. Indeed,what
they need is radically reinvented designs that deliver at least decent performance at an
ultra-low price. But there is no way to deliver 50 percent performance at a 15 percent
price by diluting existing offerings. The only way to get there is to start from scratch,
considering entirely new technologies.
Infrastructure Gap
In the rich world, most citizen have access to modern transportation, communication,
and energy systems, plus schools, hospitals, banks, courts, and more. In the
developing world, most infrastructure is mostly still under construction. This does not
mean, however, that developing nations can only gradually catch up. Precisely
because they are building from scratch, they can invest in the most modern
technologies. Meanwhile, the rich world will only invest as existing infrastructure
reaches replacement age, and, even then, will be constrained by the necessity to make
any new systems compatible with what already exists. As a result, developing nations
are hot, new construction markets, while rich nation are tepid maintain, repair, and
replace markets.The infrastructure gap, however, affects much more than
infrastructure products and services. It affects any offering that relies on infrastructure
anything that plugs in, connects to a network, or moves from place to place, and
more. Rich world offerings are designed with the implicit assumption that they will be
consumed by those with access to rich world infrastructure. Logitechs mouse was
designed for use in the office, not in the living room, because people in the rich world
still largely consume video entertainment via cable or satellite, with no mouse in
sight.Such offerings do not export well, so an innovation strategy is a must. New
offerings must be designed with the developing world infrastructure in mind. In major
cities, this may mean an enviable, next-generation infrastructure. In rural areas, it may
mean no infrastructure at all. When GE designed an ultra-low-cost portable EKG
machine for rural India, for example, one of the top considerations was long battery
life.
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Sustainability Gap
Worldwide, as the economy grows, the conflicts between economic vitality and
environmental sustainability are likely to become more severe. That said, the
pressures will not rise uniformly. In many cases, the intensity of sustainability issues
are highest in the developing world.Winning in emerging markets requires
recognition of these differences. In certain cities in China, for example, air pollution
problems are extreme. As such, it is hardly a surprise that China is poised to take the
lead in electric cars.
Regulatory Gap
When regulations function appropriately, they eliminate business behavior that is at
odds with societal good. They keep consumers safe and markets fair. That said, when
regulations become too complex, captured by vested interests, or technologically outof-date, they can become needless barriers to innovation. Regulatory systems in the
rich world are the result of decades of development while those in the developing
world may be incomplete. Whether this is good or bad from a societal perspective is
well beyond the scope of this paper, but the difference can make the developing world
a more favorable environment for innovation in certain cases. Products and services
designed around rich world regulations may become needlessly complex or expensive
for developing world markets.
Preferences Gap.
The worlds great diversity of tastes, preferences, rituals, and habits adds spice to
international travel. It also sometimes makes it nearly impossible to achieve full
potential in the emerging economies through a simple strategy of exporting existing
offerings. PepsiCo, for example, is developing new snack foods, starting with a new
base ingredient. Corn is not nearly soubiquitous in India as lentils, so Pepsi is
commercializing lentil-based chips.Because of these five of enormous needs gaps, the
common place strategy of trying to win in the emerging economies by making light
adaptations of successful rich world offerings is inadequate. Reverse innovation is the
antidote, and reverse innovation is clean-slate innovation. It starts with reassessing
customer needs from scratch.
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Findings
The company which are in reverse innovations are Tata Motors Tata Nano , GE
GE MAC 800, Procter and Gamble (P&G) Vicks Honey Cough Honey-based cold
remedy, Nestle Low-cost, low-fat dried noodles, Xerox Innovation Managers,
Microsoft Starter Edition, Nokia New business models, Hewlett-Packard (HP)
Research Labs in India, Godrej Chotukool Refrigerator, Tata Swacch Worlds
cheapest water purifier, Pepsico Kurkure and Aliva, Bharat Forge Maintenance
Management Practice, KFC Taco Bell Yum! Restaurants, Husk Power Systems,
LG Low-cost Air Conditioners (AC), Renault Logan, Better Place Smart Grid of
Battery charging/Swap terminals, GE India Steam Turbines, Coca-Cola eKOCool,
Vodafone Zoozoos, Coca-Cola Minute Maids Pulpy, Wal-Mart Small format
stores in Mexico, Levis dENiZEN brand imported to the U.S, Amazons BOLD
hiring strategy in India
85% of the worlds citizens live in poor countries, these countries will account for at
least 2/3 of world GDP growth in future decades.
Better products for consumers and a variety of options to choose from at reasonable
prices
To capture growth in emerging markets, you must innovate, not simply export.
Conclusion:
According to the leading business strategist, Vijaygovindarajan, reverse innovation
represents one of the biggest opportunities for corporate growth in America over thenext
several decades. Reverse innovation will transform just about every industry, including
energy, healthcare, transportation, housing and consumer products. Reverse innovation is
about far more than reducing cost for the sake of poor consumers. It is about pushing the
performance paradigm and offering more for less, Govindarajan explained. As counter
intuitive as it may seem, the quality demanded by poor people tends to be higher. But few
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References:
1. FVijayGovindarajan, Chris Trimble, Reverse Innovation: Create Far FromHome, Win
Everywhere, Harvard Business Review Press, 2012.
2. Vijay Govindarajan,
How GE
Is
Disrupting
Itself,
6. RADJOU, N., PRABHU, J., AHUJA, S. (2012). Jugaad Innovation: Think Frugal, Be
Flexible, Generate Breakthrough Growth.
7. Jossey-Bass.RIMBLE, C. (2012).Reverse Innovation and the Emerging-Market
Growth Imperative. Ivey Business Journal, Issue. March / April.
8. http://www.indianmba.com/Faculty_Column/FC1283/fc1283.html
9. http://ssrn.com/abstract=1923036
10. www.economist.com/node/15879369
11. http://online.wsj.com/article/SB124745880685131765.htm
12. http://www.tuck.dartmouth.edu/people/vg/blogarchive/2009/10/what_is_reverse_inno
vation.htm
13. Zuzanna Ostraszewska, Agnieszka Tylec, Reverse innovation how it works,
International Journal of Business and Management Vol. III (1), 2015.
187
MR. RAKESH. N
Abstract:
The idea of change has increasingly become a necessity for organizations rather than an
alternative that they wish to choose. Although it is usually associated with crisis, even the
most successful organizations have to face necessity of change. Ability to shift direction and
to improve functioning of an organization can be assumed as one of the key competencies of
contemporary business organizations and so does educational institutions. As the complexity
of educational life gets intense, educational institutions have become much more sensitive to
any occurrence that takes place in their environment.
While there have been various factors that force institutions to change, developments in
technology, diminishing role of governments in business life and globalization are some of
the main factors that necessitate organizations to revise the way they conduct their operations.
Technology has affected society and its surroundings in a number of ways and educational
188
institutions too have not been spared. The change will come in response to technology and
the need to adopt it as a part of how a PLC (professional learning communities) functions.
This study aims at providing a comprehensive ground, which identifies various types
of technologies affecting education, measures the acceptability of the technology and
assessing the technological impact and organizational change. Here we explore the role of
technology in the process of transformation in education.By referring to the technological
change we do not necessarily see it as a barrier that needs to be eliminated; instead, we aim to
understand the concept of technology in a wider scope to identify crucial issues that can
influence process of change in a positive way. The overall objective of this study is to
understand, analyze the types of technology, its impact causing change & management of
change.
Key words: change management, technology, transformation, education
Introduction:
Technology is a gift of God. After the gift of life it is perhaps the greatest of God's gifts. It is
the mother of civilizations, of arts and of sciences. - Freeman Dyson
The idea of change has increasingly become a necessity for organizations rather than an
alternative that they wish to choose. Although it is usually associated with crisis, even the
most successful companies have to face necessity of change. Ability to shift direction and to
improve functioning of an organization can be assumed as one of the key competencies of
contemporary business organizations. As the complexity of business life markets gets intense,
organizations have become much more sensitive to any occurrence that take places in their
environment. While there have been various factors that force organizations to change,
developments in technology, diminishing role of governments in business life and
globalization are some of the main factors that necessitate organizations to revise the way
they conduct businesses.
Computers and the Internet technology have revolutionized the field of education. The
importance of technology in schools cannot be ignored. Today, computer education is a part
of school and college curricula.The New Professional Learning Communities (PLC) is going
to change. The change will come in response to technology and the need to adopt it as a part
of how a PLC functions. Collaborative technology platforms are going to have a major
impact on the current Professional Learning Community model.
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Change will not disappear nor dissipate. Technology, civilizations and creative
thought will maintain their ever accelerating drive onwards. It could be argued that a state of
continuous change has almost become routine. The pace of change has increased
dramatically. The continuous desire for socio-educational improvement at the world level has
ushered in different discoveries, strategies and approaches to information and technology
interconnectivity at various times. Alternative delivery system of information and
communication within a typical society and the mode of transacting the content of curricula
in the educational practices at all levels and various countries of the world through
technology is fast growing. The challenges posed by Technology Mediated potentials thus
become an urgent issue to examine. Where people are serious with their development and
education they determine where they want to get to as well as
new patterns of life to adopt. So, taking account of their strengths and weaknesses they take
appropriate steps to improve their general life.
The Study:
By analyzing the different approaches that explain technological change management, this
study aims at providing a comprehensive ground, which identifies various types of
technologies affecting education, measures the acceptability of the technology and the
teaching constraints and assessing the technological impact and management of change.Our
purpose is to understand the role of technology in the process of change management.
Understand, describe & analyze the types of technology causing change in education
Apart from the above objectives, we hope that this study will be capable of contributing to
the teaching community by presenting logical arguments and providing new spaces for
further research.
Methodology and Data Collection:
The methodology adopted for the present study on the impact of technology and change
management in educational institutions is explained.
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The presentations on the various details of the study area, concepts, institutions, methods,
tools, techniques, data collection and analysis are made under the following heading.
The questionnaire was delivered in person to the institutional members with a covering letter
attached to the questionnaire to introduce the research objective of the study and the
importance of the survey. The questionnaire was sent in advance and after 10 days, follow up
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was taken to take the response. In between one reminder was given by personal contact.
Finally 50 investigators had responded on time and the data was used for the further analysis.
The data obtained from the questionnaire was finally pooled and taken as the data for the
present study.
Likert scale
Most frequently used summated scales in the study of social attitudes follow the pattern
devised by Likert. It is a psychometric response scale often used in questionnaires and is the
most widely used scale in survey research. For this reason they are often referred to as Likert
type scales. In a Likert scale, the respondent is asked to respond to each of the statements in
terms of several degrees, usually five degrees of agreement or disagreements.
Likert type scales are developed by utilizing the item analysis approach wherein a
particular item is evaluated on the basis of how well it discriminates between those persons
whose total score is high and those whose score is low. Those items or statements that best
meets this sort of discrimination test are included in the final instrument.
One institution which had branches in varied fields was chosen as a case study. The
study was undertaken on the quantitative approach however, covering all the aspects of
qualitative approach. The case study was especially to know the impact of technology and
management of change.
Concepts and tools
The basic concept of the present study is to understand the role of technology in the process
of change management. By technological change we do not necessarily see it as a barrier that
needs to be eliminated; instead, we aim to understand the concept of technology in a wider
scope to identify crucial issues that can influence process of change in a positive way. The
tools being the supportive aspects through which the strategies are generated and have the
definite explanation. The various aspects of the concepts were explained using the different
terminologies and can be explained as follows:
a. Change management: change management is a set of processes that is employed to
ensure that significant changes are implemented in an orderly, controlled and
systematic fashion to effect organizational change.
b. Goal oriented change management model: it is the model that was used as a tool for
determining the technological impact of management of change.
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c. Project operations: it is the activities of the project work that are undertaken such as
case study, interviews, collection of secondary and primary data are carried through
this process.
d. Management Options: the involvement of the management in carrying out the
required changes.
e. Justification of objectives: Every project work needs some objectives. After
completing the project, it is to be ensured that the objectives are justified.
f. Logical Conclusion: whenever a research work is completed it is to be found out that
some conclusion is arrived at for the completion of the work. It is logical end for the
research work initiated.
g. Problem analysis: on the basis of available information, the existing situation is
analyzed i.e., the major problems are identified and the main causal relationships
between are visualized in a problem analysis.
h. Participation analysis: is one of the projects handling steps, where in a
comprehensive picture of the interested groups, the individuals and institutions
involved are developed.
i. Objective analysis: in the objective analysis the problems identified are transformed
into the objectives and then analyzed.
j. Alternative analysis: it is one of the steps in research work where in possible
alternative options are identified, assessed for the feasibility.
k. Long term & short term goals: the main purpose of doing the project work is to give
fruitful results to the institutions which will be useful for a long term goal. The
desired aim planned for the distant solution.
l. Ensuring the results: every work which is being carried out should bring definite
fruitful results. It is an assurance for obtaining the results.
Analysis of the data
The data collected from the respondents of different institutions was suitably analyzed for the
significance, using the percent analysis for drawing conclusion.
Practical utility of the study
The present study certainly shows the manifold positive effects in the fields of education that
have undergone a major change and sure, they have changed for the better. The factors
mentioned in the study are those that institutions should focus on when going into the impact
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of technological change management. Based on the results of the assessment, action could be
taken at the institutional levels to improve the working and to further improve change
management through technology. Findings of this report will provide those who plan to start
and implement change programs with a comprehensive framework to locate, understand and
analyze the impact of technology and to take appropriate managerial actions in management
of change in educational institutions .
Limitations of the study
The major limitation of the study was the coverage of institutions, investigators, and the
timely response. It would require more time to really cover more institutions and in larger
population across the research process.
Analysis:
Technology is integrated with everything so why not classroom teaching. From a systems
approach, teaching with technology involves four major components: the students, the
instructor, course content, and technology tools (See Figure). An examination of each
component raises a set of issues that we need to consider in order to make technology
integration as successful as possible.
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Jeff Hiatt's book ADKAR: a model for change in business, government and our community.
This model is intended to be a coaching tool to help employees through the change process.
ADKAR is a goal-oriented 5 specific stage change management model that allows change
management teams to focus their activities on specific results. The model has been
developed for an institution to successfully change. The model has its origins in aligning
traditional change management activities to a given result or goal.
They include the following:
Awareness Awareness on the part of the individual / institution about the impact of
technology and why change management has taken place.
Desire - Either the individual or institutional members must have the motivation and desire to
participate in the called for change or changes.
Knowledge - Knowing why one must change is not enough; an individual or institution must
know how to change and if the change is in the desirable direction.
Ability - Every individual and institution that truly wants to change must implement new
skills and behaviors to make the necessary changes happen.
Reinforcement - Individuals and institutions must be reinforced to sustain any new changes,
if not; an individual or institutions will probably revert back to their old principles.
By identifying the required outcomes or goals of change management, ADKAR becomes a
useful framework for change management teams in the planning and execution of their work.
The goals or outcomes defined by ADKAR are sequential and cumulative. An individual
must obtain each element in sequence in order for a change to be implemented and sustained.
Based on this, a goal oriented change management model that allows change management to
focus their activities on specific results was identified. The model was used as a tool for
determining the technological impact of management of change. The goals or outcomes
defined here are sequential and cumulative.
The ADKAR model can be used to:
Create a successful action plan for personal and professional advancement during
change
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The ADKAR model has the ability to identify why changes are not working and help you
take the necessary steps to make the change successful. You will be able to break down the
change into parts, understand where the change is failing and address that impact point.
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Technology plays a vital role in every sphere of life and education is no exception. The
advent of technology has deeply impacted the educational scenario of the world. Technology
has certainly changed the way we live. It has impacted the different facets of life and
redefined living. Undoubtedly, technology plays an important role in every sphere of life.
Several mundane manual tasks can be automated, thanks to technology. Also, many of the
complex and critical processes can be carried out with ease and efficiency with the help of
modern technology. Thanks to the manifold positive effects of technology, the fields of
education and industry have undergone a major change and sure, they have changed for the
better. Computers and the Internet technology have revolutionized the field of education.
Online educationand distance learning have given a new dimension to the field of
education and higher learning. Today, students do not necessarily need to be physically
present in classrooms. Many educational institutes offer online courses to their students. Most
of the schools and colleges offer online assignment submission facilities. Students can submit
their homework and test assignments through the Internet. Many universities offer online
education programs wherein the students can interact with their teachers over the web, access
reference material from the University website and earn degrees online. The introduction of
technology in the educational field has made the process of learning and knowledge sharing,
an interactive and fun-filled activity.
Technology causing change in education
Agree
Technology & change in education
/ Disagree
Strongly
/Strongly
Agree
Disagree
84% (42)
16% (8)
90% (45)
10% (5)
52% (26)
48% (24)
68% (34)
32% (16)
of
the
interactive,
intercampus
telecommunication
systems connected through video networks provided
in the learning environment of higher Education
Different instructional technologies accommodate
differentTeaching practices
199
30% (15)
Education
Total Respondents: 50Table 1: Technology and Change Questions and Results
Majority of the participants felt that there was a change in education due to technological
methods adopted in teaching. There was an overwhelming response on using instructional
technology and most of them perceived the learning environment connected with video
networks and an interactive campus with internet connections.It was a fact that a number of
schools in the city have started adopting innovative and out of the box methods in the pre
primary and primary levels. Unlike older generation, this generation students are more
exposed to various media like never before. Most of the institutions had adapted themselves
to the computer and internet technology. The majority of the respondents were of the view
200
that the audio-visual medium always has a greater appeal on the student, than the traditional
method. Majority of the respondents were very confident that technology driven method of
teaching is more rewarding than the traditional method of teaching.
Agree
/Strongly
Disagree
64% (32)
36% (18)
and
be
more
efficient
8% (4)
prospective
Is technological impact a bless / curse on education
88% (44)
12% (6)
201
From the data presented above it is observed that majority of the teachers, lecturers,
professors, heads of institutions and others academically oriented strongly agree to say that
technological changes created further will result in newer opportunities and be more efficient
and prospective. They see technological impact more as a blessing than a curse on education
and the impact has also changed the methodology of teaching, that is the teachers no longer
are only text book oriented, they are more into disseminating of information, upgrading their
technological awareness which has also changed the mindset of teachers and supporting the
students in the use of instructional technology.
The study also analyzed the different approaches that explain technological change
management and aimed at providing a comprehensive ground which identified various types
of technologies affecting education, measured the acceptability of the technology and the
teaching constraints and assessing the technological impact and management of change.
The study led to the conclusion that technology can enhance the achievements of all students,
increase involvement in the children, improve teachers skills and knowledge, and improve
school administration and management. We have numerous advancements in technology
including computer functionality and telecommunication and the commercial interest has
been a powerful force. The survey, found that change driven by information technology is
202
having a significant impact on every aspect of life and is an increasingly critical issue for
education. It also certainly showed the positive effects in the field of education that have
undergone a major change and sure they have changed for the better.
Thus the findings of this report will provide those who plan to start and implement change
programs with a comprehensive framework to locate, understand and analyze the impact of
technology and to take appropriate managerial actions in management of change in
educational institutions.
Introduction of technology in the educational field can be taken up for making the process of
learning and knowledge sharing, an interactive and fun filled activity. Further studies can
allow focus on the success / failure factors of technological change and on developing a
dynamic change management model to be used by different institutions.
Conclusion:
The study led to the conclusion that technology can enhance the achievements of all
students, increase involvement in the children, improve teachers skills and knowledge, and
improve school administration and management. We have numerous advancements in
technology including computer functionality and telecommunication and the commercial
interest has been a powerful force. The survey, found that change driven by information
technology is having a significant impact on every aspect of life and is an increasingly critical
issue for education. It also certainly showed the positive effects in the field of education that
have undergone a major change and sure they have changed for the better.
Thus the findings of this report will provide those who plan to start and implement
change programs with a comprehensive framework to locate, understand and analyze the
impact of technology and to take appropriate managerial actions in management of change in
educational institutions.
On interaction with the respondents and from the personal interviews with the
teaching faculties it was seen that during this tech savvy educational times, almost every
institution had adapted to technology based teaching. With the emergence of the internet as a
mainstream technology, there has been an extreme view about the role of technology in
learning. One extreme view was that technology can have absolutely nothing to do with
learning it is just a tool. The other end of the spectrum is that technology is a panacea that
203
will enable creation of learning objects that will revolutionize how education is delivered and
received.
Introduction of technology in the educational field can be taken up for making the
process of learning and knowledge sharing, an interactive and fun filled activity. Further
studies can allow focus on the success / failure factors of technological change and on
developing a dynamic change management model to be used by different institutions.
Bibliography
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Deshler, D. D., &Schumaker, J. B. (1986). Learning strategies: An instructional alternative
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Duderstadt, James J. 2000b. Intercollegiate Athletics and the AmericanUniversity: A
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Kurzweil, Ray. 1999. The Age of Spiritual Machines: When Computers Exceed Human
Intelligence. New York: Viking.
Williams, B. (1996). The World Wide Web for teachers. Foster City, CA: IDG Books
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disabilities: Use of response prompting procedures. White Plains, NY: Longman
Wolery, M., Bailey, D. B., &Sugai, G. M. (1988). Effective teaching: Principles of applied
behavior analysis with exceptional students. Boston: Allyn& Bacon
Wulf, Wm. A. 1994. University Alert: The Information Railroad Is Coming.
(www.cs.virginia.edu/~wulf/documents/buttons.html)
Wulf, Wm. A. 1995. Warning: Information Technology Will Transform the University,
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204
Education Review Office Report (Oct 1997). The Use of Information Technology in Schools.
[On-Line] URL: http://www.ero.govt.nz/Publications/eers1997/itsch.html
www.mikenexchange.org
http://www.change-management.com/best-practices-report.htm
Annexure:
Please indicate your agreement / disagreement with each of the following:
Technology Causing Change In Education
1. Do you agree that technology driven method of teaching is rewarding than the
Traditional method of teaching?
Strongly Agree
Strongly Disagree
Neutral
Agree
Disagree
2. Do you agree that the use of instructional technology causes a change in the learning
method & increases student interest and satisfaction?
Strongly Agree
3. Interactive,
Strongly Disagree
inter-campus
Neutral
telecommunication
Agree
systems
Disagree
connected
through
Strongly Disagree
Neutral
Agree
Disagree
Strongly Disagree
Neutral
Agree
Disagree
5. Do you agree that by using technological innovation, connecting classrooms around the
205
globe through satellite, computers, interactive TV and the internet causes a great
technological change in education?
Strongly Agree
Strongly Disagree
Neutral
Agree
Disagree
Strongly Disagree
Neutral
Agree
Disagree
2. Do you agree that the technological method provides increased convenience, flexibility
and individualized learning that results in a change from the traditional classroom
centered learning?
Strongly Agree
Strongly Disagree
Neutral
Agree
Disagree
3. Would you agree that the technological method of learning adopted at all levels of
teaching would meet the requirement of the learners?
Strongly Agree
Strongly Disagree
Neutral
Agree
Disagree
4. Do you agree that the acquisition of new technical skills contributes to productive and
progressive education?
Strongly Agree
Strongly Disagree
Neutral
Agree
Disagree
5. Do you agree that the advances in the technological knowledge have brought gains in the
educational system?
Strongly Agree
Strongly Disagree
Neutral
Agree
Disagree
NO
2. Do you feel that accepting the technological based teaching method proves to be a barrier
/ constraint between teacher and the student?
YES
NO
206
NO
4. Has your management helped you in acquiring the updated technological changes in your
professional learning center?
YES
NO
NO
Strongly Disagree
Neutral
Agree
Disagree
2. Do you agree that the technological changes created would further enable in newer
opportunities in the future which would be more efficient & prospective?
Strongly Agree
Strongly Disagree
Neutral
Agree
Disagree
3. Do you agree that the technological impact is more a blessing than a curse on education?
Strongly Agree
Strongly Disagree
Neutral
Agree
Disagree
Agree
Disagree
Agree
Disagree
Strongly Disagree
Neutral
Strongly Disagree
Neutral
Strongly Disagree
Neutral
207
Agree
Disagree
TECHNOLOGY IN GOVERNANCE
MS. RAJINI.K.S
RESEARCH SCHOLAR, JAIN UNIVERSITY,
JC ROAD, BANGALORE
ABSTRACT
The increased mobility and portability arising from distributed intelligence and innovations in
wireless technologies such as satellite receivers, cellular telephony, radio paging, private
branch exchange equipment, and local area and wide area networks provide a rich
environment for cultivating good governance. Technology convergence due to digitalization,
wide band transmission, compression technologies, and standards development lends support
for the low cost provision of public services such as health care and education. The digital
India initiative stood out for its potential to transform governance, citizenship, and
entrepreneurship in India. E-commerce holds the promise of slashing the logistical costs and
linking the producer directly to the consumers, thereby getting the price benefit for both.
Technology has the potential to beat the retail chains. It can go far beyond agriculture to rural
manufacturing, which can tilt the scales in favour of the rural poor. According to the White
Houses chief technology officer-the rapid growth of technology offers government
problem-solvers a new dimension, allowing them to move beyond the traditional tools of
growing budgets and proliferating laws to find direct, action-oriented solutions.
Chinese Taobao villages have been transformed by e-commerce.Chinase-commerce giant
Alibaba has pioneered rural e-commerce through its rural arm Taobao creating 2,80,000 rural
jobs in 2014.The government has taken a cue from this technological miracle and adopted
poor villages to develop industries using e-commerce. It provides Chinese villagers the huge
choice of goods enjoyed by urban people. India needs rural e-commerce for the development
of villages. Indian villages need low-end manufacturing units to create jobs for youngsters
who have no expertise in farming.Development can happen through least governance. The
government should restrict itself to only a supportive role by investing heavily in rural roads,
electrification,broadband, telecommunication and many other technological infrastructures.
208
Introduction
Information technologies are the benchmark of the 20th Century and the main feature of the
beginning of 21st Century. This century belongs to science and technology andinnovation is
the order of the day. There cannot be any sphere in which technology has not percolated.
From computers to internet of things and now to mobile phones, Information and
communication technologys (ICTs) have dominated the world scenario.The dissemination
of their tools (computers, internet, and mobile communication) has enabled society to achieve
the necessary instruments to make knowledge accessible to the masses and to augment
productivity in industry, in agriculture, in services, and expanded cultural activity. The
greatest challenge of the information era is to avoid a gap between those who have and those
who do not have access to the goods and skills required in the digital era. Information
technology can be a powerful tool for the development of a new critical and participationoriented citizen consciousness.
Today,society isdemanding more transparency on the part of governments, more
decentralization, and more independence to express demands, desires, prerogatives and
priorities. Citizen participation is one of the more important components of local
governments where leaders are effectively concerned and engaged in the satisfaction of
community needs. When business and organizations have rapidly grown with
technology,how can government, the biggest organization of all be left behind? World over
governments are taking to technology as never before. The mood of the public is also very
progressive. The younger generation wants to be part of governance and also want things to
be transparent and to be part of the system. They are demanding their share in governance.
As organizations become obsolete without taking to technology so is the government which
also will lag behind if it does not jump into the bus.
Objectives
1. To simplify governance for government, citizens and businesses.
2. Make government administration more transparent, speedy and accountable.
209
3. Technology should address the societys needs and expectations through efficient
public services and effective interaction among people, businesses and government.
Scope
Technology contributes to social inclusion, the expansion of human freedom, and the
reduction of the digital divide. Good governance manifests itself in the successful interaction
with the constituted powers mainly with the legislative but also with the executive; at the
same time, it requires the decentralization of decisions and of institutions and budgets.
Governance is all about flow of information between the government and citizens,
government and businesses and government and government. Technology bridges the gap
that exists between them.
Technology for improving governance at the local level can changesocial and political
relations in a society. Governance at the local level must begin to be analyzed at the
legislative level.
instrument
of
using
Internet
for
e-government,
other
210
E-Governance in India
Indias central and state governments have tended to follow a silo approach to eGovernance.Some implementation has taken place but has tended to be piecemeal and
disjointed and, consequently, having little impact. This has prevented the absolute necessity
for the benefits of IT to percolate to the grass root level. Today, there is a proliferation of
portals in India. Most states have their own portals,but a majority of these portals cannot be
considered to be anywhere nears the one-stop shops that should provide end-to-end services
to citizens. Ministries and individual departments have separate websites and these are not
always linked and joined up in any meaningful way. What is required in Indias government
sector is a strategic shift from the commodity based IT approach to a mature solution/services
based approach. The central and state governments need to start procuring IT services rather
than procuring hardware, software and services.However, for successful implementation of
E-Governance, government officials have to realize that E-Governance is no longer a matter
of choice, but an absolute need of the day. Cooperation from government officials and staff
will be crucial in realizing the goals of modernizing this nation through E-Governance.
Successful e-Governance Projects in India
Project Akshaya, an IT dissemination project, was launched on 18th November 2002 as a
pilot in Malappuram, a district in Kerala. The project envisaged development of 5000
networked Multi-purpose Community Technology Centers,akshaya e-kendras to provide ICT
access to the entire population of the state. The objective of this project was to make at least
one person in each of over 65 Lakh families in the state e-literate. Run by private
entrepreneurs, each e-kendra was envisaged to be setup within 2-3 kilometers of every
household to cater to the requirements of around 1000-3000 families to make available the
power of networking and connectivity to the common man. Akshaya is a social and economic
catalyst focusing on the various facets of e-learning, e-transaction, e-governance, information
and communication. The success in Malappuram has led to a state wide rolling of the project.
In Malappuram alone, the project has trained more than 5.9 lakh people. 65 % of the trainees
were women.
211
MCA21
This project is Indias first mission mode projectunder the National e-governance plan.
MCA21 has enabled 100% electronic filing, electronic payment mechanisms, use of Digital
Signature Certificates for all transactions andtotal transparency for service delivery. The
implementation of such a large-scale transformation project, in the shortest possible time, is a
landmark and has established a benchmark for such a program not only in India but across the
world.
APonline
It is a digital gateway to the Indian state of Andhra Pradesh (AP) to provide multiple
government services through multiple channels, anytime and anywhere to citizens and
businesses. The AP online has a self-sustaining delivery model and is currently working
through 1300 kiosks and franchises. Delivers government information and services through
Internet, manned and unmanned kiosks and collection agents. The model had generated
employment for over 2000 people in the state. It has developed a host of applications for the
benefit of rural citizens and farmers. It has also helped bridge the digital divide to a great
extent. The portal has resulted in greater transparency, convenience, accountability and
responsiveness for citizens and businesses and lower overall costs for citizens and businesses.
It has also helped governments enjoy an improved image and cost-savings by reduced
delivery cost.
E-Choupal
The e-Choupal, information centers linked to the Internet, represent an approach to
seamlessly connect subsistence farmers with global markets. e-Choupal has helped link the
largest labour force with the mandis, the international markets as well as the final consumer
at much reduced transaction costs. It is one of the largest information technologybased
intervention in rural India and has transformed the Indian farmer into a progressive
knowledgeseeking netizen. E-Choupal delivers realtime information and customized
knowledge to improve the farmer's decisionmaking ability, thereby better aligning farm
output to market demands securing better quality, productivity and improved price discovery.
The model helps aggregate demand in the nature of a virtual producers co-operative, in the
process facilitating access to higher quality farm inputs at lower costs for the farmer.The eChoupal initiative also creates a direct marketing channel eliminating wasteful intermediation
and multiple handling, thus reducing transaction costs and making logistics efficient.
212
and
parameters
for
governments
to
reach
their
citizens
or
end
Pc /100
Telephone lines/100
Internet Users/100
India
2.76
3.37
6.93
Canada
94.58
55.48
76.77
UK
81.21
55.43
66.15
USA
79.89
53.35
71.94
Australia
75.70
47.05
54.19
Singapore
72.61
41.91
69.99
214
communication
technologies
for
improved
competitiveness
and
Country
Score
Singapore
6.0
Finland
6.0
Sweden
5.8
Netherlands
5.8
Norway
5.7
Switzerland
5.7
United States
5.6
United Kingdom
5.6
Luxemburg
5.6
10
Japan
5.6
215
83
India
3.7
The government is placing a lot of emphasis on ICTs as a way to address some of the
countrys most pressing issues, including job creation, corruption and red tape, and education.
Whether this vision will translate into a transformation of the economy and society remains to
be seen. But already ICTs are having aalbeit small transformational impact on the
economy, which is partly reflected in Indias performance in the economic impacts pillar.
The govt. is very keen on putting India on the global map of implementing Technology in
governance.The launching of the Digital India programmer is a flagship programme of the
Government of India with a vision to transform India into a digitally empowered society
and knowledge economy.
On July 1st 2015 The Prime Minister launched the digital India programme and said that
Digital India has drawn investments worth Rs 4.5 lakh crore and will create 18 lakh jobs.
With the launch of Digital India programme, the government is taking a big step forward to
transform the country into a digitally empowered knowledge economy. It includesvarious
schemes worth over Rs1 lakh crore like Digital Locker, e-education, e-health, e-sign and
national scholarship portal. BharatNet is used in 11 states and Next Generation Network
(NGN), is also a part of Digital India campaign. The programme includes projects that aim to
ensure that government services are available to citizens electronically and people get benefit
of the latest information and communication technology.
Challenges
The main challenge is the lack of equality in public access to the internet, reliability of
information on the web, and hidden agendas of government groups that could influence and
bias public opinions.
The challenges brought about by ICT integration revolve on the question of how to allow the
advancement of different segments of society toward innovation and the adaptation of new
technologies in order to improve government processes and to reduce economic and social
disparities.Potential
implications
of
implementing
and
designinge-
217
9.2 CONVENIENCE- THE USAGE OF TECHNOLOGY IN GOVERNANCE OFFERS THE GREATEST BENEFIT OF
CONVENIENCETO CITIZENS TO ACCESS INFORMATION, UNDERSTAND GOVERNMENT POLICIES,
RULES AND REGULATIONS AND MANY OTHERS.
Builds accountability
Conclusion
218
Creating digital markets and boosting digitization can yield significant economic benefits and
lead to substantial social benefits to societies and communities. Digitization has the potential
to boost productivity, create new jobs, and enhance the quality of life for society at large. For
example, if emerging markets could double the Digitization Index score for their poorest
citizens over the next 10 years, the result would be a global US$4.4 trillion gain in nominal
GDP, an extra US$930 billion in the cumulative household income for the poorest, and 64
million new jobs for todays socially and economically most marginal groups. This would
enable 580 million people to climb above the poverty line.
There is a definite improvement in governance conditions with technology. It represents the
introduction of a new form of political relationship in which individuals in society, their
representatives, social groups, social and political organizations, pressure groups, among
others, can act directly over governments. Improves local governance and represents a
decisive step in the democratization process of public information and in citizen-governmentcitizen, or citizen-citizen-government interactions. The citizen-government relationship
recognizes and warrants that government authorities will fulfill public demands and
priorities.Technology represents a decisive step in the process of democratization of public
information, and in the interaction between citizens and government, assuring the provision
of services by government of the publics demands and priorities.New political relations of
groups, individuals, social and political organizations with governments, only has stimulated
social movements to increase even more the utilization of ICT as an instrument for improving
governance. Within participative social movements, individuals engage in a process of
searching informative material and actively engage in an interaction process with
governments.
Technology can be very useful for interacting with the legislative, obtaining information on
legislative operations norms, rights, monitoring of legislative proposals, actions
pressurizing the legislature and contacts with representatives.
References
http://news.harvard.edu/gazette/story/2010/09/technology-in-governance/
The Times of India dt 25-10-2015 p12
219
http://reports.weforum.org/global-information-technology-report-2015/executive-summary/
http://www.tcs.com/SiteCollectionDocuments/White%20Papers/tcs_government_idealegover
nanceindia.pdf
The Times of India, dt 1/7/2015 page-1
The Times of India, dt 21-11-2015 page-1
http://www.jatit.org/volumes/research-papers/Vol17No1/5Vol17No1.pdf
Journal
of
220
221
Introduction
You can have data without information, but you cannot have information
without data
Daniel Keys Moran.
Over the period the companies and the market they
participate,
have
become
more
complicated
and
According to a new
survey commissioned by Dell and
conducted by Competitive Edge
Research Reports, shows that 41% of
mid-market businesses have one or
more big data projects already in
place, with another 55% planning to
start one in near future.
- 80% agree they need to better
analyze their expanding data
collections.
- 89% with a big data initiative in
progress report significant
improvements in company decision
making.
- 96% of the 300 surveyed
organizations are either already using
big data projects or are planning to
start one in the near future.
- Big data budgets will rise to an
average of $6 million over the next
two years. This is from the current
figures of between $2 million and $5
million
Source:
https://www.linkedin.com/pulse/20
140502105616-8781298-25insightful-and-thought-provokingquotes-about-big-data
222
1960s. It started with structured data and slowly over the period various
technologies.
motion is collected on real-time using sensors. Data in motion is used to analyze the
quality of the products during manufacturing to avoid costly errors, whereas data at
rest is used to understand buying pattern based on all aspects of customer
relationship including sales social media data and customer service interactions.
1960s
The Evolution started with the structured data, during the period when
the computing moved into the commercial market in late 1960. The
companies used detailed programming methods to create value to the
data.
1970s
1980s
and
collaboration.
Web,
Virtualization
and
cloud
223
1990-
The cost of computing and cycles and storage has reached an all-time
2000
2000-15
Sherlock Holmes
Big data are defined by three dimensions- Volume, Variety and Velocity. Data volume is
measured by the quantity of transactions. But volume is further complicated by attributes,
dimensions, or predictive variables. Data variety continues to increase day by day. This
leads to complexity due to various formats and structure. Data sources can be
Internet data- Click Stream, Social Media, and Social Networking Sites
Image
data
Video,
Satellite,
Image,
Surveillance
business?
Pricing, Quality
224
Velocity is how fast the data are processed. Analytics use smaller samples to create
predictive models. The data is doubling every 2 years. Further, most new data is
unstructured [95 percent] and grow exponentially.
Setting up architectural foundation
Big data -why it is important? -Because Enables organizations to gather, manage
and manipulate vast amounts of data at the right speed, at the right time, to gain the
right
insight
Internet. The starting point is the problem that is to be solved which will dictate
what data required to be captured and what architecture is required. The needs of
the organization are determined by asking the following questions.
Capture
How accurate,
precise
the data
Organize
required?
Analyse
Integrate
What interfaces are required to manage internal and external data? Open
Application Programming Interface [API] will be core to any big data
application.
All the above questions focus on the necessary architecture for the
organization. Big data architecture is not just the hardware and networked
distributed processing system, but also includes the necessary operating
system to process virtual distributed data and software for analytics. The
big data management involves five basic steps Capture, Organize,
Integrate, Analyse, and Act [COIAA] [See Fig 1.0 Processes in Big data
Management]
Layers of Big data
It is a capital mistake to theorize before one has data.Sherlock Holmes,
The basic architecture involves 4 layers: [Fig 2 Layers in big data management]
database,
feedback,
social
media
channels,
flexible
and
affordable
for
the
organization.
Analytical Spectrum
SQL Analytics
Count
Mean
OLAP
Descriptive
Analysis
Univariate
distribution
Central
Tendency
Data Mining -1
Predictive
Analytics-2
Association
rules
227
Clustering,
Feature
Extraction
Classification
Regression
Forecasting
Spatial
Machine learning
Text Analytics
pectrum, Michael
s , Wiley Publications
For predictive analysis techniques such as regression, forecasting text analysis are
used. Organizations also use linear and non-linear optimization and simulation
techniques such are Monte-Carlo techniques for big data analysis. In Business
Intelligence applications Online Application Processing [OLAP] and Online
Transaction processing [OLTP] are used for handling data. [The overview of data
analytics is shown in Fig 3 Big data analytics and spectrum]
Data Output layer : This is how the insights gleaned through the analysis is passed
on to the people who can take action to benefit from them Clear and concise
communication (particularly if your decision-makers dont have a background in
statistics) is essential. And this output can take the form of reports, charts, figures
and key recommendations.
Ultimately, your Big Data systems main task is to show, at this stage of the process,
how measurable improvement in at least one KPI[Key Performance Indicator] that
can be achieved by taking action based on the analysis you have carried out.
Big Data Applications Some Examples
You may have heard the world is made up of atoms and molecules, but it's really
228
made up of stories. When you sit with an individual that's been here, you can give
quantitative data a qualitative overlay.
William Turner
An example of how big data are used by a Hotel Chain in US to increase bookings is
given below. Generally the Bad weather reduces travel, which then reduces
overnight lodging. Thats not good news if youre in the hotel business. However,
Red Roof Inn turned this trend for its betterment. The hotel chain recognized that
cancelled flights leave travelers in a bind and in need of a place to sleep overnight.
The hotel chain sourced freely available weather and flight cancellation information,
organized by combinations of hotel and airport locations, and built an algorithm
which factored weather severity, travel conditions, time of the day and cancellation
rates by airport and airline among other variables.
With its big data insights, and recognition that travelers will be using mobile devices
for this use case, the company used Search, PPC and SoLoMo mobile campaigns to
deliver targeted mobile ads to stranded travelers and make it easy for them to book a
nearby hotel.
The advisor - http://www.ingrammicroadvisor.com , mentions the following four
Big data applications which are more commonly used:
Call center analytics- Big Data solutions can help identify recurring problems
or customer and staff behavior patterns on the fly not only by making sense
of time/quality resolution metrics, but also by capturing and processing call
content itself. What's going on in a customer's call center is often a great
barometer and influencer of market sentiment.
229
Social media analysis: Everyone is using social media now a days. Social
media can provide real-time insights into how the market is responding to
products and campaigns. With those insights, companies can adjust their
pricing, promotion, and campaign placement on the fly for optimal results
Conclusions
It's difficult to imagine the power that you're going to have,
When so many different sorts of data are available.
Tim Berners-Lee
Big Data will be the Next Big
technology and analytics. Businesses started using the technology for increasing
revenues and achieve competitive differentiation. The companies have started using
the technology in supply chain management and Marketing campaign optimization.
Analytics are looking at the applications such as Portfolio Optimization, Risk
Management, next best offer for ad targeting and yield optimization and risk
minimization. The emerging applications are chronic disease prediction and
prevention. Big data is a troublesome force presenting opportunities with challenges.
By 2016, it is estimated that 4.4 million IT jobs in Big Data would be available; 1.9
million is in US itself. India will require a minimum of 1 lakh data scientists in the
next couple of years in addition to data analysts and data managers to support the
Big Data space. The challenge arises on three dimensions- generally called as 3VsHuge Volume, Variety and velocity. When so many sources and quantum of data
is available, you cannot imagine the power you are going to have.
Bibliography
230
I acknowledge gratefully all Authors who have contributed in the area of big-data
including the sources mentioned below:
Books:
1. Judith Hurwitz, Alan Nugent, Fern Halper and Marcia Kaufman, Big data
for dummies, Wiley Publication, New Delhi ISBN 978-81-265-4328-1
2. Michael Minelli , Michele Chambers, Ambiga Dhiraj, Big data Big
Analytics , Wiley Publication.
3. Jared Dean, Big Data , Data Mining and machine learning , wiley publication
4. Arshad Khan, Data Warehousing- 101 concepts and implementation, BPB
Publications, New Delhi
Internet sources
1. https://www.linkedin.com/pulse/20140502105616-8781298-25-insightfuland-thought-provoking-quotes-about-big-data
2. https://www.linkedin.com/pulse/indias-poor-state-human-capital-callsurgent-govt-action-biswas
3. http://www.ingrammicroadvisor.com/big-data/four-powerful-big-dataapplication-examples
231
agencies lose significance. The recruitment also looks beyond recruiting traditional
employees to recruiting talent over the network who connect, do the job and disconnect. The
process follows an open call format i.e. being open to virtually anyone in the world. The
volunteering workers join, connect over the network and do the job. This is known as
crowdsourcing. This depends on building and nurturing a qualitative community, a strong
employment brand, vibrant social networks, mapped competitors, and putting in place a
predictable talent pipeline for key hiring channels (Jeffery, 2011) (Foxall, 2013) (McClure,
2011) (Haterd, 2011). Simply defined, crowdsourcing represents the act of a company or
institution taking a function once performed by employees and outsourcing it to an undefined
(and generally large) network of people in the form of an open call. This can take the form of
peer-production (when the job is performed collaboratively), but is also often undertaken by
sole individuals. The crucial prerequisite is the use of the open call format and the large
network of potential laborers (Howe, 2006).
Technology continues to impact hiring in a big way. The war for talent on one hand makes it
imminent for companies to find newer and better ways of acquiring talent. On the other hand
there is a continuous pressure to reduce cost and improve the ROI on recruitment. In short,
can technology help to improve the rigour and effectiveness of hiring and help in acquiring
better talent at a lower cost? The more a company can do that, the greater advantage it has
over its competitors. Better talent at a lower cost means even more in knowledge intensive
and tech-skills intensive industry like Information Technology. IT Project-based
organizations are increasingly transitioning to fully automate hiring using automation and
artificial intelligence. The possibility of reducing human involvement and let machines take
over the hiring initially in screening resumes and then in conducting selection tests and then
even in scheduling interviews and finally conducting interviews and making offers (Nagy,
2013) (Paesani, 2013) (Jibe, 2015) (Rosenblum, 2015) (Faliagka, et al., 2012).
Research Objective
The research paper is a result of a research project undertaken in a premier IT Project based
MNC Inimcap .Inimcap is determined to adapt a new system to acquire talent.
Currently the talent acquisition process is more traditional and involves face-to-face
approach. The talent acquisition process is on the verge of a major transformation using
automation and artificial intelligence technologies.
While technological development and implementation is definitely futuristic but the greater
challenge comes from acceptance from the recruiters and even more from the business
233
managers for them to believe that the next resource who will be hired in their team is going to
hired by a machine.
The objective of this research was to understand the various issues in implementing the new
talent acquisition system and plan and map the entire change strategy for the company.
The paper hence attempts to explore aspects for successful execution of the new talent
acquisition process:
Case Study
In choosing Inimcap13 as the focus of the research, an attempt was made to study a projectbased organisation facing challenges in the way it changed from a traditional talent
recruitment system to a modern technology enabled fully automated online recruitment
system for acquiring talent. The complexities of managing this change at Inimcap provided
for a comprehensive study of change management issues at a project-based organisation.
Rationale behind the choice of the case method
Case studies contribute to the building of a professional repertoire (Schn 1991). A case
study and, normally, history focus on one case, but simultaneously take account of the
context, and so encompass many variables and qualities, either following an explicative
strategy as opposed to experimental (one unit of analysis and a few isolated variables) and
reductive (many units of analysis and a few variables) (Johansson 2002). Our objective to
understand the various aspects of managing change from a traditional talent recruitment
system to a automated online talent recruitment system led us to choose case research
method. The case presented in the study conforms to Yins definition. The case investigates a
present-day phenomenon in a real-life setting, and the focus is on organizational and
managerial (rather than technical) issues (Myers, 2003).
About Inimcap
13
Inimcap is an alias for the actual IT project-based company that was the focus of the case study.
234
professional
services.
165,000 people. Inimcap Group offers an array of integrated services that combine
top - of - the - range technology with deep sector expertise.
Inimcap in India has over 65,000 people across 8 cities. A pioneer in the IT
industry, Inimcap has nearly 50 years of global expertise collaborating with leading
corporations and brings the Consulting, Technology and Outsourcing experience to India.
With dedicated teams to service the local markets, Inimcap has strong domain
experience to service clients across the Government and Public Sector, Energy and
Utilities, Manufacturing, Telecom and Financial Services sectors.
Benchmarking Competition
Competitor 1 - WIPRO
Wipro,
one
of
the
biggest
Indian
IT
Company,
use
an
online
recruitment system - Synergy, which has the database of all resumes received
through
various
sources.
candidatures. The
The
system
provides
The system does a duplication check at the time of resume entry and
of
processing.
Wipro
processes
the
first
at
the
time
For
the
this
reason
opportunity
to
they
work
created
for
the
WASE
programme, which
provides
the company gives young and motivated students exposure to a multinational company
work environment. The students
have an
the
opportunity to
work
on
live client
projects along with full time employees of Wipro. This enables them to get invaluable
industry experience and technical knowledge.
Competitor 2 - IBM
IBM has designed Watson, a home grown artificial intelligence based recruitment system.
Watson is an artificially intelligent computer system capable of answering questions posed
in natural language developed in IBM deep QA project by a research team led by investigator
David. The system was named after IBMs first CEO Thomas J. Watson.
How IBMs Watson works 235
The first step consists on exploring IBM job openings and submit resume online
If the company think there is a potential match, the candidate will be asked
to complete
brief
video
or
written
introduction.
For
IBM
Recruitment technology
The
company
acquisition
from
standardize
the
provides
also
sourcing
recruitment
to
services
hire,
process
to
so
to
automate
company
make
it
the
full cycle
solution
of talent
is designed
to
2015 )
The idea is offer a service in real time that help adhere to government regulations
and hiring practices, centralize talent data and leverage it across the talent management
life cycle, and respond to business growth objectives
helping
company
move
to
understand
requires
change
so
it
is
organisations
are
goal
directed
want to reach: if this does not happen, than a change is needed. This is the
case of Inimcap with its recruitment process. The present recruitment process has neither
been efficient nor been effective in identifying and acquiring talent.
The present e - recruitment process at Inimcap is as follows:
Resume phase
Collect all resumes from different sources (i.e. Monster, LinkedIn etc.)
236
Online test.
and
Anticipatory
strengthening
existing
opportunities
within
too,
in other
terms
competitive position,
change
the
that
(Managerial
company
means
want
realising
People in charge of doing the interview are not competent enough. Most of them do not
have a psychology
in
basis.
Old Problem What needs to be changed?
The current issue is the inefficient recruitment process: with too many candidates for
the traditional one. The candidates experience is really bad, because they need to
wait for a lot of time and in this way HR department cannot give them the right
attention . Travelling to reach the recruitment place seems to be uncomfortable and
expensive for the candidates, and it can affect their performance too.
Benefits of Change
Time saving will be a major benefit of the new fully automated online recruitment system.
The time savings will be both from the candidate perspective (who will no longer have to
travel long distances or wait in long queues for their interview) and also from the companys
perspective. Inimcap is working f or the future when all candidates could appear
for the selection test from wherever (location) they prefer.
>Cost effectiveness
The difference between putting a job vacancy on company website and putting one
on a newspaper is huge in terms of cost. A recruitment consultant fee for a
candidate could be anything up to 20% of the first years salary, with online
recruitment you can choose between a huge number
cost
of
of
candidate
reducing
the
The online assessment will reduce the cost too, for example with the new system an
online assessment will be cost only about 5 dollars per candidate.
>Time Savings
237
With the new fully automated online recruitment system in place the entire recruitment
process could be done in a day: a job vacancy can be put on a job site in the
morning, the first applications arrive by lunchtime, and a candidate interviewed by the
end of the day. Of course, it isnt always like this; senior position need more time,
because there are more details to fix. But it would still be far quicker than the present
system.
recruitment
doesnt
face
time,
localization,
availability
problems, whereas the traditional one could be national , local or trade press faces
these kinds of limitations. The success of the process is hugely people dependent.
Automated Online
recruitment
is
different.
job board or website is there 24 hours a day, 7 days a week, for as long as the
company desires. Candidates can come back to it again and again. Everybody in the
company can access to it: from office administrator to the Financial Director: they
are all online and so there is an increase in transparency .
>Bigger audience
More people every year could access to Internet all around the world. So company
audience increases every time. It is many times believed that online recruitment is
only effective
Research
for young net - savvy Facebook generation. This simply is not the case.
consistently
shows that
the
average
age
of
candidates
using
online
recruitment channels is around 35 years old. And the trend is up. Online recruitment
is now a standard part of most peoples job - hunting no matter what level or age.
>Easy
Posting a job on company own site is straight forward enough. Most job sites
CV
databases
are
very
user - friendly
and
an
in - depth knowledge
and
of
238
The
change
consists
on
shifting
from
traditional
inefficient recruitment
Resume Parsing
Collect all resumes from different sources (i.e. monster, LinkedIn etc .)
All stages are planned to conclude after 6 months . Nevertheless each stage is
independent, so it is possible to stop each one at any time if it is required. Training
sessions are schedule only f or the second and the third phases.
Consequences of Changing
Change will be reducing costs, it will be a better assessment process experience,
and
it
will be avoid human error and subjectivity during the process. The company will
save a lot of time too and can use the energy saved in other processes; and finally
the employees can reduce the effort for routine activities and focus on building greater
levels of engagement. The contents of change involved are technology, quality and cost
(i.e. building efficiency reduces cost).
Key issues in Change
This change impacts the entire organization.
department. For instance a department, which asks for an extra employees, should
accept the output of the new system.
A change agenda should answer many questions like
What
capabilities
are
the
company
missing
and
which
the
company
one
the
What
are
the
critical
issues
facing
and
how the
In
Explain well to all actors involved the problem faced and also the benefits
order
to
answer
to
of change.
239
It
is
preferable
speak
in
small
groups
with
employees
who
have
similar responsibilities.
During the process the leader should be open to capture all feedbacks
that arrive from the environment.
Mobilizing Support
In order to change, people in an organization have to be assembled and
together
to
bring about
meaningful
results
rallied
People
have
to
take
charge
of
the
change.
Participation,
Persuading
mainly
involves
communication.
Effective
Inimcapmust mobilize support for this change. In fact, not all the stakeholders may
agree with the new procedures and they can put up a resistance to it. Many change
management efforts in organizations fail because they do not sufficiently mobilize the
support of people. Many times, managers jump from appreciation to execution,
skipping this crucial step. Hence it will be important for Inimcap to mobilize support of
recruiters, business managers and other stakeholders to ensure that the execution is smooth
and acceptance of the new system is high.
Approach to Change
According to Axelrod (2009), there are four historical approaches to change:
of expert - driven
the
and
Change
Management
team - driven
240
approach,
approaches.
case
which
While the
is
of
a
former
provides
order
to
gain
suggestion for Inimcap would be to create parallel organizations across the functions
and the levels of workers. A sponsor team can be created comprised of managers
of the different functions, so that they can initiate and promote change. The
main supporters of the change in recruitment will have to be the top level managers.
For
this
reason,
organization.
Ownership and Involvement in the change process
Employees
ownership,
involvement
and
200
people
commitment
the
to
Bangalore
change
division
are crucial to
of
Inimcap
view of the employees and involve them in the change process is a crucial
aspect for the HR managers. In f act, the main opposition to the change can
come from them, who can see the e - recruitment as a threat. They must be told
the benefits of the change and that one of such benefit will be that they will be able to devote
more time and attention towards more strategic functions of HR like engaging employees.
Also the employees of the line functions need to be involved in the process. They
are going to work with people recruited through the automated online system, so it
is important to know their point of view and commit them to the change. Once
involved, they would feel strongly part of the change and of the entire organization.
There is a need to build support of a number of employees that is referred to as the
critical mass, the minimum number of people in an organization whose support
is required to launch change.
Difficulties in Mobilizing Support
Some
difficulties
can
come
out
during
the
process
of
mobilizing support; in
fact, most individuals are oriented to stability rather than change. Therefore, people
need to be persuaded to give up the status quo. They need to be sufficiently
enthusiastic to alter their mindset and mental models. What it should be done in
this case, is to make all the employees understand the benefits that fully automated
e - recruiting can bring to the company, in order to make them feel enthusiastic and
to involve them in the change process.
241
In
order
to
create
a critical
for
them. The change agenda should consider the stakeholders interests. At Inimcap,
there are three main groups who can oppose some resistances to the change:
1.
2.
Technical team: they could find it strange to work with people hired
by a machine or a completely automated process. This can lead to problems
of trust and team work.
3.
Project managers: like technical team members, the project managers can also
put up some resistance to having in their teams people hired through an
automatic process instead of the traditional one.
On the other side, the supporters of the change who can help in mobilizing
support though the company are:
The CEO.
Senior managers.
Recruitment head.
Mobilizing
support
is
largely
about
influencing
people
to
change despite or
because of their self - interests. Its important to use and understand the art of
persuasion. Its important to select people who are undecided about the change
agenda, in order to convince them, while supporters and opponents can be ignored.
Then, it may be identified the interests of people whose support is needed. The
concerns usually are about:
Threat to identity.
242
In
order
to
persuade
the
target
groups,
it
should
be
created
automated online
recruitment
and
to
assure
consequences.
they
are
likely
to
miss
if
the
co - workers
who can
job
and
to
Reduce the costs, and this will benefit the entire company.
It may be useful to present to the target audience of employees bench - marking to the
organizations against the best practices of the other organizations, like IBM and Wipro,
so
that
employees
are
exposed
influence and persuasion f ail, a manager may need to mobilize support through
negotiation. To negotiate, its important to show to the target audience what they
can
earn
in
return
of
their
commitment
company, selected by a scientific and reliable method, who will help the company to
grow.
Executing Change
Inimcap faced several challenges during the execution phase.
243
Implementation took more time than originally assigned. Each phase of the
online recruitment took variable time for implementation.
2.
b.
c.
3.
Coordination
of
implementation
activities
was
not
effective enough.
process
Capabilities
and
skills
of
employees
involved
were not
enough
for
process,
Certain uncontrollable
factors
in
the
environment
delayed the
implementation.
Inimcap will have to further elaborate the main aspects of change has to consider in
order to accomplish a successful execution of change.
Lessons learnt while executing the change
There is a further need to define and share what is behind changing the actual
recruitment
process
f or
comprehensive
automated online
244
the
positive
aspects
There is a need to acknowledge the support of its employees who support the
change and motivate them to share their experiences and views with other
employees.
within
each
stage of the
short - term
purpose
of
on
implementing
and
promote
the
To boost the collaboration among the agents involved (HR, hiring managers,
recruitment team). This can be accomplished by:
Creating
reward
between
different
departments,
in
of sharing information
hiring managers.
It is important to share
the
goal
245
and
importance
of
the
new
It is important to share
the
positive
results
of
online recruitment
policies,
procedures
and
remove
structural
New routines
f or
continuous
improvements
created.
It is also important to benchmarking i.e. seeing what others have done and
adapt.
Discussion &Conclusion
Implementing a change initiative is never easy and in case of Inimcap the lessons learnt were
both before, during and after implementing the change (automated talent recruitment system).
The lessons learnt before helped caret a change management plan for transitioning from a
traditional recruitment system to an automated online talent recruitment system. During
execution however, more lessons were learnt from the challenges that the company faced in
implementing the new system. The lessons drafted for future execution aim to gradually
change to the new talent acquisition system. The lessons learnt in this case can be significant
for other project-based organizations when they transition to a more advanced talent
acquisition system.
246
10 WORKS CITED
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247
AVIJIT SARKAR
DESIGNATION: STUDENT, INDIAN ACADEMY SCHOOL OF MANAGEMENT
STUDIES
ABSTRACT
Today the firms exist in a turbulent environment where technology changes quite often,
satisfying a customer is a big challenge and competition among companies is severe within
the industry. With these backgrounds it is clear that innovation is indispensable in an
organization. Innovation gives a competitive advantage over other organization. There is no
doubt that for the organization to survive and flourish innovation is considered to be very
important. Sustainable growth is possible due to continuous improvement through innovation.
For the innovation to happen a supportive organizational culture is inevitable.
Employees accept innovation as an essential requirement in the organization with the
influence of the supportive culture. There are four cultural profiles according to Cameron,
Quinn and Robert (1999) for an organization like clan, hierarchy, adhocracy and market. For
the study only clan and hierarchy are considered and four characteristics considered for the
study are dominant characteristics, management of employees, organizational glue and
criteria of success (Julia, Daniel and Raquel 2011). From innovation side the framework
developed by Muller et al(2003) that explains the dimensions of innovation like resource
view, capability view and leadership view are considered. The study tries to find out the
favorable cultural characteristics that can introduce and prosper innovation in an
organization.
For the study a small sample of 30 responses are collected from the individuals who are
working in three different companies where innovations are encouraged. Companies are in
existence for three or more than three years. Study may throw light on the importance of
culture on innovation. Other independent variables considered for the study are age of the
company and years of experience of the respondents in the same company.
248
Introduction
There is no doubt that innovation is a driving force for the growth of a company. Those
companies realized this factor encourage for more novelty. It is clear beyond doubt that
innovation is the key to the success of many organizations. Imitation always takes the back
seat and customer satisfaction and appreciation will be less for such products. Defining
innovation is not as easy as it is expected. It is highly intricate and complicated. It is a
multidimensional phenomenon where thorough knowledge and skill and out of the way
thinking contribute for the new idea to born, develop and implement. Other important factors
include infrastructure, teamwork and supportive supervisor or management. High level of
motivation, opportunities, flat structure and flexibility will provide an environment for new
ideas to generate. An idea generated has to be nurtured well in the organization. For that an
encouraging and supportive work culture is important. Culture influences the innovation to
design with novelty, to take risk and make use of opportunities appropriately. It is the
behavior and faith that persuades or dissuades the ideas that are created. The development
and implementation of the created ideas is based on the trust, cooperation and support from
fellow workers and superiors. Convincing the new idea and later executing is challenging.
Many a time the fear of failure and loss of money deter employers from supporting it. But
studies show that companies that conduct business in hightechnology industries must
innovate or die (Angel, 2006;p.1) and the presence of an innovation culture serves as a
critical success factor. Such companies do not give importance to failure. They try
continuously till success is achieved. This paper tries to understand the importance of culture
for innovation to happen. Four important characteristics considered for culture include
dominant characteristics, management of employees, organizational glue and criteria of
success. These characteristics are based on the adhocracy and hierarchical culture. Innovation
is defined based on the components like resource, capability and leadership.
Defining Innovation
An increasing number of professionals and researchers define innovation as any idea,
practice, or object that the individual or organization adopt and regard as new (Damanpour,
1991). According to Drucker (1974), innovation can be generally defined as the process of
249
equipping in new improved capabilities or increased utility (i.e. innovation is not a science or
technology but a value). Inputs are transformed to outputs using technology. Sophisticated
machines, systematic process, complicated techniques and appropriate layout make the
technology innovative. The focus on strategies, values and methods makes technology
purposeful for those who use it. Rogers (1995) defines innovation as an idea, practice or
object that is perceived to be new by an individual or other unit of adoption. It is not correct
that complicated and sophisticated invention is only innovation. Any innovation that adds
value to the end user and adds profit to the creator is accepted. Innovation always gives a
competitive advantage to the companies. For the companies to continue in the growth phase
of the life cycle, innovation is a must. Novelty is the ultimate word to satisfy the existing
customers and can create new clients. So innovation can be defined as creation of new
products and services that can serve the society with ease and with comfortableness.
Identifying the needs and modifying the existing products or creating totally a new one that
satisfy the needs of customers gives stability and continuous growth for the company. Keeny
and Reedy (2007) point out that innovation involves the adoption of new products and/or
processes to increase competitiveness and overall profitability and it involves new ways of
identifying the needs of new and existing clients. For the innovation strategies to be initiated
and to encourage this motive an ideal culture that supports innovation is required.
Understanding Culture
Culture is generally defined as a set of values, norms and beliefs within a company. An apt
definition by Schein (1992) explains culture as a pattern of basic assumptions that was
learned by a group as it solved its problems of external adaptation and internal integration,
that has worked well enough to be considered valid and therefore, to be taught to new
members as the correct way to perceive, think, and feel in relation to these problems. Culture
can encourage and mold behaviour and attitude of the employees. Adapting to the new
culture may take time but once adapted it will continue for long time. It is important to create
a healthy and progressive culture to be developed in the organization for the employees to be
positive and energetic towards the job. According to Gaynor (2002) innovation is depicted as
a cultural element of an organisation which should be instilled by managers in order to
communicate to employees the organisations mission, drive them to search for unique
opportunities, ensure that those opportunities align with the organisations strategic direction,
and both define the measurements needed to evaluate an those opportunities success and to
continually reassess that opportunity in the future so as to ensure that it remains relevant and
250
beneficial. Culture explains the shared values, ideologies, beliefs and traditions that is passed
year to year and is shared among all the employees. This culture reflects in their job and
behaviour. The metamorphosis that happens in the new entry employees related to the culture
of the organization will lead to better performance and advantage.
A culture that cultivate autonomy, open and informal communication, flexible structure and
teamwork among the employees result in innovation to thrive well. The results of the study
by Wang et al. (2010) indicate that firms with high orientation for the team were able to make
better use of financial investments and human capital to produce innovations than firms with
low orientation for the team. An effective team with mutual trust and cohesiveness is possible
251
to achieve the best with good leadership. Leadership style also influences innovation
(Amabile, 1998). As explained, for the creativity to develop more flexibility, openness and
with less stringent rules and regulation. Along with this, leadership style to follow is also
important. For the creativity to penetrate into the minds of the employees participatory or
democratic leadership is perfect. Such kind of a leader motivates the employees to work
along with him and is clear about the outcome to be attained.
Objectives
To find out the influence of culture on innovation.
To find out ideal culture (adhocracy or hierarchy) for innovation to flourish.
To find out whether age of the company has relation with innovation components like
resources, capabilities and leadership.
Hypothesis
H1: There is a relationship between adhocracy culture and innovation.
H2: There is a relationship between age of the company and components of innovation.
Creation of Framework
In this study, cultural characteristics like dominant characteristics, management of
employees, organizational glue and criteria of success are considered. The items selected for
these dimensions help to score the culture as adhocracy or hierarchical. Muller et al.(2003)
have developed a framework to understand the innovative capacity within a firm. He has
considered resource, capability and leadership as the dimensions of innovation. Framework
prepared by him combines resource view, capability view and leadership view on innovation.
Resource view addresses the allocation of capital, labour and time resources to achieve the
return on investment in strategic innovation. Capability view assesses the extent to which the
companys skills, tools, and values are adapted to innovation. Leadership view assesses the
degree to which a companys leadership supports innovation. The competing values
framework, as developed by Cameron, Quinn and Robert (1999) has been used in
constructing an organizational culture profile. In this respect the overall culture profile of an
organization is identified as clan, hierarchy, adhocracy and market. For the study only
hierarchy and adhocracy is considered. Hierarchy in an organization focuses on internal
maintenance with a need for stability and control. Adhocracy concentrates on external
positioning with a high degree of flexibility and individuality. The six characteristics
252
ADHOCRCY
CULTURE
DOMINANT
CHARACTERIST
ICS
RESOURCE
MANAGEMENT
OF EMPLOYEES
INNOVATION
CAPABILITY
HIERARCIAL
ORGANIZATION
AL GLUE
LEADERSHIP
CRITERIA OF
SUCCESS
Methodology
In the demographic aspects age of the company and the sector is considered. Another factor
was the years of experience of the individuals from whom sample was collected. This was not
included for the study but considered only those responds who has worked in the same
company for minimum five years. Employees with more years of experience can respond
well to questions related to culture and innovation. The data for the study is collected from
employees working in three different sectors. They are manufacturing, IT and publishing
companies. A total of thirty samples are collected including all the three sectors. Other
samples with less years of experience has been eliminated for the study. From the four
253
cultural profiles according to Cameron, Quinn and Robert (1999) only hierarchy and
adhocracy are considered for the study. The four characteristics of culture considered are
dominant
characteristics,
organizational
leadership,
management
of
employees,
organizational glue and criteria of success are developed by Julia, Daniel and Raquel (2011).
From innovation side the framework developed by Muller et al(2003) that explains the
dimensions of innovation like resource view, capability view and leadership view are
considered. The study tries to find out the favorable cultural characteristics that can introduce
and prosper innovation in an organization.
From the descriptive statistics it is found that out of the 30 samples collected, 12 companies
are aged less than 5yrs, 11 are more than 5years and less than 10years, About 7companies are
aged more than 10years of age. While collecting the sample, companies more than 3years are
considered. Sectors taken into account were manufacturing, software companies and
publishing. Out of which 50% were manufacturing, 20% were software companies and the
rest 30% are publishing.
age of company
Frequency Percent
Cumulative
Valid Percent Percent
12
40.0
40.0
40.0
36.7
36.7
76.7
23.3
23.3
100.0
Total
30
100.0
100.0
Three sectors considered for the study are manufacturing, software and printing
press. More samples are collected from manufacturing (50%), then publishing
(30%) and last software company (20%).
Cumulative
Valid Percent Percent
Valid manufacturing 15
50.0
50.0
50.0
Software
20.0
20.0
70.0
Publishing
30.0
30.0
100.0
254
Three sectors considered for the study are manufacturing, software and printing
press. More samples are collected from manufacturing (50%), then publishing
(30%) and last software company (20%).
Cumulative
Valid Percent Percent
Valid manufacturing 15
50.0
50.0
50.0
Software
20.0
20.0
70.0
Publishing
30.0
30.0
100.0
Total
30
100.0
100.0
Analysis is conducted using regression to find the cause and effect of the characteristics of
culture with innovation. For this items related to adhocracy and hierarchy is taken to find the
culture suitable to innovation.
The first characteristic considered is organization-dominant characteristic. In that one item is
adhocracy culture related and the other one is hierarchical culture related.
Coefficientsa
Model
1
Unstandardized
Coefficients
Standardized
Coefficients
Std. Error
Beta
3.200
Sig.
.822
3.893
.000
Organization-dominant 3.243
characteristics
(adhocracy)
.249
.304
.000
Organization-dominant 2.989
characteristics
(hierarchy)
.218
.291
.000
(Constant)
.123
255
.145
Coefficientsa
Model
1
Unstandardized
Coefficients
Standardized
Coefficients
Std. Error
Beta
3.200
Sig.
.822
3.893
.000
Organization-dominant 3.243
characteristics
(adhocracy)
.249
.304
.000
Organization-dominant 2.989
characteristics
(hierarchy)
.218
.291
.000
(Constant)
.123
.145
Coefficients a
Unstandardized
Coefficients
Standardized
Coefficients
Std. Error
Beta
3.676
.856
Management
of -.133
employees (adhocracy)
.230
Management
of -.038
employees (hierarchy)
.205
Model
1
(Constant)
256
Sig.
4.294
.000
-.112
.579
.027
-.036
-.186
.051
Coefficientsa
Model
1
Unstandardized
Coefficients
Standardized
Coefficients
Std. Error
Beta
3.200
Sig.
.822
3.893
.000
Organization-dominant 3.243
characteristics
(adhocracy)
.249
.304
.000
Organization-dominant 2.989
characteristics
(hierarchy)
.218
.291
.000
(Constant)
.123
.145
Standardized
Coefficients
Std. Error
Beta
3.570
.615
Organization
-.280
glue (adhocracy)
.196
Organization
.195
glue (hierarchy)
.206
Model
1
(Constant)
257
Sig.
5.804
.000
-.313
-1.427
.016
.208
.949
.032
Coefficientsa
Model
1
Unstandardized
Coefficients
Standardized
Coefficients
Std. Error
Beta
3.200
Sig.
.822
3.893
.000
Organization-dominant 3.243
characteristics
(adhocracy)
.249
.304
.000
Organization-dominant 2.989
characteristics
(hierarchy)
.218
.291
.000
(Constant)
.123
.145
Coefficientsa
Model
1
(Constant)
Unstandardized
Coefficients
Standardized
Coefficients
Std. Error
Beta
1.676
.826
Sig.
2.029
.052
.455
.361
1.961
.050
.253
.014
.077
.939
The last characteristic considered in the study is criteria of success. In this items
considered in adhocracy and hierarchy are
a) Having the most unique or newest products. It is a product leader and innovator.
b) Efficient-dependable delivery, smooth scheduling, and low-cost production are critical.
258
The study tries to find out whether innovation parameters are true with the age. First
innovation related to resources is taken into consideration. ANOVA is carried out to find out
the allocation of resources for strategic innovation is related to the age of the company. The
test finds that as the age of company advances strategic allocation of resources will be well
versed by the company. This help in innovation and thus age is related to resources that leads
to innovation.
Mean Square F
Sig.
Corrected
Model
3.124a
1.562
1.353
.016
Intercept
153.714
153.714
133.123 .000
Age
3.124
1.562
1.353
Error
31.176
27
1.155
Total
193.000
30
Source
.016
29
There is no significant relation between age and innovation related to capabilities. It is found
that innovation due to the capabilities has no significant relation to age of the company.
Tests of Between-Subjects Effects
Dependent Variable: innovation-capabilities
Source
Mean Square F
Sig.
1.536
1.027
.372
Intercept
183.169
183.169
122.433
.000
Age
3.073
1.536
1.027
.372
Error
40.394
27
1.496
Total
226.000
30
29
259
Source
Mean Square F
Sig.
1.536
1.027
.372
Intercept
183.169
183.169
122.433
.000
Age
3.073
1.536
1.027
.372
Error
40.394
27
1.496
Total
226.000
30
29
Mean Square F
Sig.
Corrected
Model
1.124a
.562
2.114
.240
Intercept
50.923
50.923
191.587 .000
Age
1.124
.562
2.114
Error
7.176
27
.266
Total
59.000
30
Source
.240
29
Discussion
This study focuses on culture and innovation. In order to study the culture the characteristics
considered
are
organization-dominant
characteristics,
management
of
employees,
organizational glue and critical success. The items considered in these dimensions are
categorized as adhocracy and hierarchy. This has helped to understand whether which type of
260
culture is suitable for innovation. From the study it is found that organization-dominant
characteristics related to hierarchy and adhocracy culture are significantly related to
innovation. From the analysis it is clear that innovation happens in a dynamic and
entrepreneurial environment and also in controlled structure where policies and procedures
govern the organization. Even though some other studies prove that entrepreneurial climate is
ideal for innovation, here it is proved that hierarchical culture also initiate innovation. This is
found in some manufacturing and few printing organization. But not found in the software
companies. Next characteristics considered is management of employees, here in adhocracy
culture individuals are keen in taking risk, freedom and uniqueness. But in hierarchical
culture security, stability in relation and less interest to take risk is found. The study proves
that adhocracy culture is suitable for innovation. But hierarchical culture cannot be
eliminated totally. It is not significant as compared to the adhocracy culture. Hypothesis is
proved correct that for innovation to nurture, adhocracy culture is significant. A culture
where risk taking initiatives are encouraged, novelty and freedom is given to test and
develop new ideas is the ideal environment for innovation. This is proved through this study.
In organization glue, adhocracy and hierarchical culture proved true and significant. Both the
cultures are proved to be good for innovation. Hierarchical culture emphasis on rules and
policies but study proves that innovation initiatives can happen in such a climate also. Such
initiatives are seen more in manufacturing and printing companies compared to software
companies. While considering the criteria of success, the adhocracy culture item included is
about the uniqueness of the products. It is proved significant that such things are part of
innovation. But hierarchical culture related to criteria of success that includes smooth
scheduling and low cost production is not significant. Apart from this for the innovation to
happen some of the components that contribute to innovation is compared to age of the
company to find out whether there is any relation between the company with experience and
innovation. This study concludes that leadership and capability as innovation components has
no influence on age of the company. It shows that optimal resource allocation improves with
experience and is related to innovation.
Conclusion
The study tries to emphasize the importance of culture for innovation. A culture that is
flexible, open and with fewer formalities is good for innovation is proved beyond doubt from
this study. But interestingly a culture with formal, hierarchical, stable and that rule with
policies and procedure can also nurture innovation is clear in this study. The study did not try
261
to understand in- depth about the sector that encourages hierarchical culture. But interaction
with the employees after the analysis revealed that manufacturing environment in most cases
is rigid and still innovation happens. So the view that adhocracy culture alone encourages
innovation is proved wrong through this study. The number of years since the company is
established is also an important factor for the innovation to sink into the threads of the
organizations culture. From the analysis it is clear that innovation with resource view is
managed well as the age advances. Optimal use of resources for the innovation is possible in
an effective manner as the experience of the company increases. But capabilities and
leadership varies from time to time in the organization. It depends on the incoming or
outgoing of the employees and leaders in the organization, innovations prosper. So age of the
company is not related to the capability view and leadership view of innovation. The study
can be extended to find out the influence of other cultures like clan and market culture to find
out how innovation do well in these cultures. Another area of interest can be to probe the
innovation sting in the sectors that is not included in this study.
Bibliography
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Angel, R. (2006), Putting an Innovation Culture into Practice, Ivey Business
Journal,January/February 2006, pp. 15
Covin, J. G., Slevin, D. P. (1991). A conceptual model of entrepreneurship as firm behavior.
EntrepreneurshipTheory and Practice, 16 (1), 725.
Damanpour, F. (1991). Organizational innovation: A meta-analysis of effects of determinants
and moderators. Academy of Management Journal, 34 (3), 554590.
Drucker, P.F. (1974). Management: Tasks, Responsibility, Practices. New York: Harper
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Gaynor G.H. (2002), Innovation by Design: What it Takes to Keep Your Company on the
Cutting Edge, AMACOM American Management Association, New York, NY.
Muller, Amy , Vlikangas, Liisa & Merlyn, Paul (2003), Metrics for Innovation How
Companies Can Develop a Suite of Innovation Metrics to Combat Decay Retrieved Feb 16,
2005, from www.woodsideinstitute.org.
Rogers, E (1995), Diffusion of Innovations, New York, NY: Free Press
Schein, E.H. (1992), Organisational Culture and Leadership, 2nd ed., JosseyBass,
SanFrancisco
262
Wang, S., Guidice, R. M., Tansky, J. W., Wang, Z. (2010). When R&D spending is not
enough: The critical role of culture when you really want to innovate. Human Resource
Management, 49 (4), 767792.
***************************
263
MANJUNATH DALER
DEPARTMENT OF MANAGEMENT STUDIES, JSS ACADEMY OF TECHNICAL
EDUCATION, JSS ATE CAMPUS, UTTARAHALLI-KENGERI ROAD,
BANGALORE
Abstract:
The banking sector in India has witnessed many changes over a period in their
operational abilities and the services provided to the customers with the various innovations
in technology. These technological innovations also found in the financial institutions have
facilitated in connecting millions of people to the banking system. Quick access to internet
and smart devices together with the advances in cloud computing has transformed the outlook
of the customers who often update their choices and compelled the banks to upgrade to offer
customer-oriented business services through the digital media thereby gaining a reduction in
cost. Today these financial institutions no longer use technology to provide efficient services
but have become proficient in employing electronic and telecommunication networks to
deliver various value added services. Consequently the banks also invest considerable amount
of money year-over-year in order to deliver better services to its customers and also to attract
new customers. Accompanied by these advantages, several drawbacks also can be found
which include loss of customer data by hackers and fraudsters, security issues, online
transaction risks, inability to deliver services at times of system failure. Hence it is imperative
for the banks to address these issues and ensure secure and reliable transactions.
The main goal of the study was to understand the role of IT in banking and realise the trends
in IT enabled services in three banking sectors namely, private, public and foreign banks.
This study also analysed the perception of the banks as well as customers toward introduction
of ITeS and also contrast the opinion of the customers and banks if any. Both qualitative and
quantitative methods were used to obtain primary and secondary data. Qualitative research
264
method was used to collect primary data through questionnaire from senior managers of the
banks. In addition, the opinion of the customers of the banks was also collected through a
separate questionnaire. A total of 12 well established banks was studied under three groups
viz. private, public and foreign. Different statistical methods were used to analyse the data
collected from the customers and qualitative analysis method was used to analyse the opinion
of the banks. The results showed that overall the customers and banks had a positive attitude
toward ITeS and its accessibility. However, few minor drawbacks were also detected from
both the sides. Based on the results obtained corresponding possible solutions were suggested
to the banks.
Introduction
Technological, financial and institutional innovations have played a crucial role in
connecting millions of people in India to the banking system. Fast, powerful and easier
internet connectivity and convenient smart devices have changed the behaviour of the people,
who frequently re-evaluate their choices to get the most out of the choices available.
Concurrently, the innovations in mobility, cloud computing, and big data have developed
opportunities to drastically reduce cost paving way for creation of a customer-focused digital
business model for the banking system. Traditionally, banks used technology to improve the
efficiency of its services and to develop new products. Over a period, banks have become
adept in using electronic and telecommunication networks to deliver a number of value added
products and services. The delivery of these services is possible through private and public
networks, dial-up connection, and through a wide range of devices, namely personal
computers, automated teller machines, mobile phones, etc. India has 150 million Internet
users, thereby standing third in the race while first and the second places are taken by China
(575m) and the US (275m). Despite the overwhelming number, the penetration is only 12%,
which is not all that bad news as there is unrivalled growth opportunity at all sectors,
especially in the banking industry [1]. In 2013, 800 million transactions have been conducted
through digital media of which, 44% of the share was appropriated by internet banking [2].
The wide surge in the net banking usage has acted as the motivation for this study to
understand the trend in IT enabled services in India.
265
266
the factor loadings the constructs were grouped and further tested. Hypotheses were tested
using multiple linear regression and p<0.5 were accepted as significant value.
H10 = The expectation of the customers did not have significant impact on the opinion
on services offered by banks.
H1a = The expectation of the customers did have significant impact on the opinion on
services offered by banks.
The opinion of customer service provided by the different banks was examined by
taking it as dependent variable and the overall expectation as the independent variable.
Simple linear regression was applied to find the impact of the actual services provided by the
banks on the expectation of the customers. The results showed that the customers from
Foreign banks perceived that the services offered by the banks had high impact on the
expectation. The expectation from the customers could explain 45.1% of the variation in the
services provided by the foreign banks (P=0.000). Similarly, in the New banks, 21.2% of the
variation in the opinion on services offered could be explained by the expectation of the
customers (P=0.000). In the case of Public banks, 16.6% of the variation could be explained
by the expectation (P=0.001). In all these cases, the regression model was accepted as
predictable. On the contrary, in the Old banks, the model could not be accepted as it was not
significant (P=0.108).
Table: Customer service representative- opinion of participants
Model Summary
Model R
Old
.255a
.065
.041
.30724
.065
2.702
39
.108
New
.461a
.212
.201
.39581
.212
18.879
70
.000
Public
.407a
.166
.152
.53513
.166
11.719
59
.001
Foreign .671a
.451
.433
.33148
.451
26.235
32
.000
267
1)
More number of respondents were from new generation private banks (35%)
followed by public sector (29%), old private (18%) and foreign banks (16%) in
that order.
2)
Though the number of people using ATM and online banking in old generation
are lesser compared to public and New Private banks, the participants of old
generation banks are considerably comfortable with ATM and online banking.
3)
Customers of all the banks felt that computerisation has increased the service
efficiency of the banks. Old private and public bank respondents agreed that the
transactions were secure whereas New and Foreign banks were expected to
offer better secure transactions. For the parameter waiting time, Old and
Foreign banks had highly satisfied customers in comparison to New and Public
banks although they were satisfied to some extent.
4)
The problems of e-banking do not have any influence on the overall opinion of
the customers regarding the services offered by the banks.
5)
6)
Various banks also perceived that they have gained significant benefits by
introducing IT in their routine functions and also identified few barriers such as
security of customers personal data, reduced customer relationship,
inconvenience caused during system failure and inept strategies to attract techsavvy younger generation.
7)
8)
Perception of the banks in increasing their customer base by introducing ebanking services was positive.
9)
Conclusions
The increasing competition in conjunction with increasing expectations from the
stakeholders has forced the banks to realise the importance of role of technology in banking.
Indian banking sector has applied the IT and e-banking in almost all the banking services and
products literally moving towards virtual banking.
268
[2]
Tejas Tripathi. Digital payment industry in India reached INR 85,800 crore in 2013:
Net banking still most favourite! May 25, 2014. Available at <http://www.dazeinfo.
com/2014/05/25/digital-payment-industry-india-reached-inr-85800-2013-netbankingstill-favourite>
[3]
[4]
[5]
[6]
[7]
269
[8]
Gareth Lodge, Hua Zhang and Jacob Jegher. IT Spending in banking: A global
perspective. 2014. Available at: <http://www.celent.com/reports/it-spending-bankingglobal-perspective-1/>
[9]
Karl Flinders. Indian banks see double-digit increase in IT spending. March 2014.
Available at http://searchcio.techtarget.in/news/2240215985/Indian-banks-see-doubledigit-increase-in-IT-spending
270
PAPER SUBMITTED TO
ACHARYA BANGALORE B-SCHOOL, BENGALURU, INDIA
Management Education in India has taken twists and turns in last six decades. MBA degree
is offered by the Universities but the game changed when PGDM was introduced. When
several private institutions started offering PGDM program in past three decades, the real and
competitive business started, as focus shifted mainly to Placements. B-Schools mushroomed
and regulatory authorities were unable to control the market. When quality took a back-seat,
Input (Intake of students), Process (Teaching & Learning) and Output (Placements) affected
the Performance of B-Schools as a whole. Environmental changes like, Governmental
Policies, Revised Norms laid down by Regulatory Authorities, Media intervention through BSchool Rankings, flourishing Coaching Centres and their influence, Technology Platforms,
271
Accreditations by domestic and global agencies, Agencies acting as Admission Agents, etc.,
brought in cut-throat competition. With primary concern on ROI, managements of B-Schools
resorted to cost-cutting instead of on developmental activities.
Employee Loyalty
Key Words: Bell Curve, Big Data, B-School, Business Competition, Data Analytics,
Sustainability
Management Education in India has taken different routes and shapes in the last six decades.
Andhra University, Visakhapatnam started its Management Department in India as the first
public university to offer MBA degrees with more on knowledge dissemination to students
whereas the first generation of IIMs (Calcutta, Ahmedabad and Bangalore) along with Xavier
Labour Relations Institute (XLRI, Jamshedpur) and Indian Institute of Social Welfare &
Business Management (IISWBM, Kolkata) started their Post Graduate Diploma in
Management (PGDM) Programs in order to give practical exposure in addition to knowledge
sharing. Faculty form IIM-A have come all the way to interior villages of Karnataka and
spend time to understand the various issues of farmers and developed Case Studies on
Management principles which are still used as classical cases in all B-Schools even today.
Due to LPG (Liberalisation, Privatisation and Globalisation) in late eighties and early
nineties, Technical Education, mainly, Engineering and Management Programs were offered
by several Institutions without having even the basic facilities. All public universities gave
272
Institutions took advantage of the situation and offered variety of the courses to attract more
students. While the economy of the country got opened, more job opportunities have come
and pushed these Institutions for larger enrolment of students in last two decades. Coaching
Centres started encashing the situation by offering long-term and short-term courses and led
to a situation whereby 3 lakh candidates competing for 1 lakh MBA seats through these
national level entrance tests like CAT, XAT, MAT, etc. Host Institutions took support from
the technical organisations in order to conduct these tests as well as declaring the results, as
handling such a Big Data led to several technical issues which caused many concerns to
parents and students. There were situations where it was not very clear on how many
Institutions were offering different types of Management Programs in India, some times even
without necessary approvals and permissions.
The following Tables (Table-1 and Table-2) give information on various aspects like no. of
Institutions, their student enrolment, Fees charged and Placement Status, along with Pay offer
etc. from Recruiters that differentiates the Tier-I to other B-Schools:
Table-1: Research Report on the Survey conducted by CRISIL 2014
No.
Category
(in %)
Enrolment
(in %)
Fees
(Average,
No.
Students
of Pay Offered
(Average CTC
Placed
in Rs. Lakhs)
in Rs. Lakhs)
(in %)
Tier-I
95-100
12-15
98-100
9+
Tier-II
10
80-95
8-12
80-98
5-9
Tier-III
52
70-80
5-8
60-80
3-5
(Top B-Schools)
273
Tier-IV
37
0-70
0-5
0-60
0-3
No. of
Status of
MBA Intake
Status
B-Schools
B-Schools
2013-14
3364
-107
354421
+5052
2012-13
3471
-70
349369
14504
2011-12
3541
+ 72
334865
6808
2010-11
3469
+179
328057
16928
2009-10
3290
+170
311129
16077
2008-09
3120
+205
295052
19386
2007-08
2915
+301
275666
28465
of
Intake
The information in the above tables (Table-1 and Table-2) also raises doubts about the
sustainability of some B-Schools, as these lower tier B-Schools may slowly disappear in
long-term. Government was also not very keen for regulating such a mushrooming business
till some major issues cropped up like abnormal fees, lack of quality in Teaching, increase in
un-employability, etc. which reflected on poor enrolment as well as moderate placements of
MBA students.
Review of Literature
274
K.S. Srinivasa Rao (2002) developed a Bermuda Triangle model with Student, B-School and
Recruiting Company and indicated clearly that a student whose academic performance is not
up to the mark during his/her MBA Program may disappear before getting proper career
opportunities. Also, it was indicated that any B-School not performing well in terms of
contemporary curriculum, may vanish without meeting its long term goals. Finally, it was
pointed out that recruiting companies which are not performing well in business may also be
disappearing from the placement scenario even though the students received their preplacement offers with such companies.
K.S. Srinivasa Rao (2003) analyzed the situation on Indian Higher Education market when it
opened to global market, expressed his doubt that Indian B-Schools may not withstand the
competition as the B-Schools were not contemporary in curriculum, and having less
autonomy in the academic administration.
I.M.Pandey (2004) suggested the governance model for Higher Education Institutions (HEIs)
as a normative model consciously created with specific mission and well-defined goals.
By taking IIM-Ahmadabad as a reference, the author indicated that the real decision-making
should be with the faculty members who will develop a culture of excellence. The author
cautioned that the government's role should be to put an eminent board in place which will
act as a sounding board for the decisions of the institutes. It was indicated that if the HEIs
achieve excellence as determined by the users of teaching, research, consulting, etc., they
would have made a tremendous contribution to the society and served their purpose.
K.S. Srinivasa Rao (2004) explained the role of a teacher in influencing the student to choose
his/her career under the autonomy by making the pedagogy such a way by making the course
more interesting.
K.S. Srinivasa Rao and Chowdari Prasad (2005) analyzed various local issues and challenges
of Indian B-Schools when they face global competition.
Dirgha Sampat (2008) took the side of Employers and mentioned that the key element of
MBA education is value chain, as lakhs of graduates produced by these B-Schools are trained
to drive that great big enterprise Indian Inc. The author suggested that while education is
275
all about learning from the best faculty in the business in an environment that stimulates and
energizes young minds, there is more to B-Schools than academics. The author mentioned
that the process of B-Schooling is also about turning raw talent into well rounded individuals.
10.1.1.1 K.S. Srinivasa Rao (2008) discussed various issues and challenges in autonomous
institutions offering Management Education at Post Graduate level with focus on
curriculum, assessment and performance of the students in Campus Placements.
Thomas R. Guskey (2011) observed that educational improvement efforts over the past two
decades focused primarily on articulating standards for student learning, refining the way we
assess students' proficiency on those standards, and relating results to accountability. It was
pointed that the one element still unaligned with these reforms is grading and reporting.
Student Report Cards today look much like they looked a century ago, listing a single grade
for each subject area or course. The author suggests that educators seeking to reform grading
must combat five long-held traditions that stand as formidable obstacles to change. Although
these traditions stem largely from misunderstandings about the goals of education and the
purposes of grading, they remain ingrained in the social fabric of our society.
Yogesh. C. Joshi and Ashish. K. Makwana (2012) pointed out that in post WTO scenario,
with the inclusion of education in GATS (General Agreement on Trade in Services), a
discussion on free trade in education becomes imperative. The authors were under the
opinion that in the race for globalization, it is the resource-rich universities and educational
institutions of the developed nations, which will definitely have an upper edge over the
resource-starved institutions of developing countries. The authors indicated that globalization
and commercialization of education is becoming a reality and India being a prominent
economy, in so far as the concern of human resources is concerned, cannot afford to ignore
these changes. The authors through their research survey concluded that there was very less
awareness, in general, regarding GATS provisions among university teachers across
categories of Lecturers, Readers and Professors in the Universities. The authors indicated that
the universities also face constraints of resources, undue interference from government and
lack autonomy to compete in the wake of privatization of higher education. Therefore,
universities require a great deal to transform and restructure themselves to compete
successfully with foreign universities, owing to free trade and implementation of GATS in
India.
276
Beatriz Oria (2012) indicated that Pedagogical research on higher education during the last
decade has been mainly concerned with fostering an educational model in accordance with
the recommendations of the Bologna Declaration of 1999. However, it was observed that
despite remarkable progress that has been made so far, the students future employability is
still seriously curtailed by an excessively theoretical and/or content-based training, which
does not cater effectively for the development of transversal skills. The author reported the
results of a pilot experience carried out at the University of Zaragoza (Spain), in the joint
program in Law and Business Administration and Management. The goal of this research
project was to enhance students employability by supplementing the subjects / syllabus with
complementary activities and tasks meant to improve some of the competencies and skills
promulgated by the European Higher Education, thus improving the students chances in
todays competitive labour market, while enhancing the quality standards of the Degree.
Howard Thomas, Peter Lorange and Jagdish Sheth (2013) questioned the status, identity, and
legitimacy of Business Schools in the modern university system. They shared their critical
insights on management education and new B-School models in the US, Europe and Asia.
They looked at how the B-Schools are changing their focus in particular on emergent global
challenges and innovation in curricula, professional roles, pedagogy, uses of technology and
organisational delineations.
Jamuna A.S. and K. S. Srinivasa Rao (2013) studied the need of effective communication and
its impact on the professional life of students of management. It was observed that students,
who may get better grades in written examinations, sometimes may not be effective in their
oral communication which plays an important role while facing the Campus Interviews. Also,
it was noticed that smart students who are able to communicate well during interviews may
be getting better placements even though their academic grades are average.
B. Mahesh Sharma (2014) indicated that getting admission for an MBA is not a difficult
proposition now-a-days, as many B-Schools are open for admission with not many takers for
their seats.
AICTE officially accepted that 30% of seats remained vacant in 2012. As more than two
lakhs apply for MBA every year, with limited seats in premier Institutions, the author
mentioned that it is a big challenge for others to find a Best-Fit B-School. Parents and
277
students think that Ranking is not the only criteria they have to see but they should also work
on Campus Infrastructure, Hostel Facilities, Placement Records, Faculty Profile, Industry
Interaction and other Activities on the Campus.
K.S. Srinivasa Rao, Chowdari Prasad and Jamuna A.S. (2014) focused on the academic
autonomy in Indian B-Schools and discussed various issues and challenges involved in
assessing the students as per the pedagogy. The authors suggested the need for normalisation
using bell curve while assessing the students with a relative grading mechanism.
SR Singhvi and Amit Agnihotri (2015) indicated that Indian Management Education is in
crisis today facing different challenges at different sections of the pyramid of Programs and
B-Schools. The authors mentioned that Indian top tier B-Schools are lagging behind not just
the Western B-Schools but even behind Asian peers like those in China, Singapore and Hong
Kong. They have mentioned that Indian mid-tier B-Schools are struggling for their survival
and around 500 PGDM B-Schools were closed down during last seven years. The authors
mentioned that the bottom-tier B-Schools, largely 3000+ low-cost MBA programs offered
by affiliated colleges of public universities, where MBA is just another course that costs few
thousands of rupees, have little direction and relevance.
278
The authors have noticed through Literature Survey that B-Schools in India are not generally
utilising the Big Data that they are having in terms of Student Admissions, Academic
Progress, Faculty Activities and Placements in order to have growth and development of the
Institutions.
This gave an idea to utilise the Analytics of Big Data for various workable
Methodology
In order to study the behaviour of these B-Schools, the authors have considered one agency
which maintained their assessment parameters same for long years. Interestingly, this agency
considered only top 50 B-Schools while assessing their performance. Data was taken from
their reports for three years using secondary sources from their published information on BSchool Ranking survey.
279
The following Table-3 gives the parameters the agency standardised for the three consecutive
years:
Intellectual Capital
II
Industry Interface
IF
PP
Placement Performance
ECA
IL
International Linkages
RS
SS
FS
The authors have given weighted ranks for each of the parameter in each year and categorised
the B-Schools into four levels based on the cumulative rank score. In an Open Model where
the system is like a Stochastic Markovian Birth-Death Process, 70 B-Schools were identified
which are in top 50-position in any one of the three years (Refer: Annexure-I).
Past data was taken in order to see the effect of the predictions.
Data Analysis:
In a Closed Model, the authors have considered 30 B-Schools from these 70 B-Schools,
which are consistent in all the three years of the study like a Steady-State Markovian Process
given in the following Table-4:
280
City
New Delhi
IIM, Ahmedabad
Ahmedabad
IIM, Bangalore
Bangalore
IIM, Calcutta
Kolkata
Mumbai
New Delhi
Ghaziabad
Hyderabad
Manipal
10
Noida
11
Tiruchirappalli
12
New Delhi
13
Chandigarh
Mumbai
14
Research
15
Bangalore
16
Bangalore
17
New Delhi
18
Ahmedabad
19
New Delhi
20
Coimbatore
21
Pune
22
New Delhi
23
Navi Mumbai
Xavier
Institute
of
Management
&
Bangalore
24
Entrepreneurship
25
Bangalore
26
Coimbatore
27
Lucknow
281
28
Indore
29
Bhubaneswar
30
Cochin
Out of these 30 B-Schools in the closed Model, one Institute is considered among the top 10
B-Schools as a Case Study and analysed by applying the four types of Data Analytics of Big
Data as given in the following Table-5:
Table-5: Top 10 B-Schools in the Closed Model
S.No. Business School
City
Location
New Delhi
North
Trade)
IIM, Ahmedabad
Ahmedabad West
IIM, Bangalore
Bangalore
South
IIM, Calcutta
Kolkata
East
Mumbai
West
Research
New Delhi
North
Ghaziabad
North
Hyderabad
South
Pai
Management
Institute (TAPMI)
10
Manipal
Noida
South
North
The authors have considered the Bench-marked Institutions for the identified B-School from
various regions SP Jain from West, IIFT and IMI from North leaving IIMs which are of
different nature by their status and functioning.
The following Table-6 gives positioning of the Selected B-School in three years of study on
the identified parameters under Descriptive Analytics:
Table-6: Position of the Selected B-School in each year on the Identified Parameters
RANK
Name of
the
IC
II
I&F
PP
282
ECA
IL
RS
SS FS TOTAL
Institute
Year
2003
250
230
200
385
80
150
200 60
60
1615
161
45.1
152 55
50
722
250
385
80
150
200 60
60
1615
147.75 66.5
42
775
280
210
200 60
60
1655
47
727
Case
18
Study
Institute
Year
2004
230
200
Case
13
Study
Institute
Year
2005
230
325
80
210
Case
13
Study
Institute
The following Table-7 gives the Diagnostic Analytics of the Selected B-School:
Placements, Faculty
Weakness
Opportunity
Threat
Interface and with a Chairman having more than 25 years Industry Experience. It had a
separate cell for Admissions with a Chairman having 15 years Experience. The B-School
has a PGP Chairman of 3-year term on rotation.
The following three Tables [Table-8 (a), 8(b) and 8(c)] of Correlation Matrix followed by
Regression tables will give information on Predictive Analytics:
II
IF
PP
IC
1.0
II
0.5 1.0
IF
PP
ECA IL
RS SS
FS
1.0
RS
0.6 1.0
SS
FS
II
IF
PP
ECA IL
RS
1.0
0.8
1.0
0.6
0.7
1.0
0.7
0.7
0.6
1.0
0.7
0.8
0.5
0.8
1.0
0.8
0.8
0.7
0.8
0.8
1.0
0.8
0.8
0.7
0.8
0.8
0.8
284
1.0
SS
FS
SS
FS
0.7
0.7
0.7
0.7
0.6
0.8
0.8
1.0
0.6
0.5
0.5
0.5
0.5
0.5
0.7
0.8
1.0
II
IF
PP ECA IL
RS
SS
IC
1.0
II
0.9 1.0
IF
PP
ECA
IL
1.0
RS
0.9 1.0
SS
0.5 0.7
1.0
FS
0.2 0.3
0.5
FS
1.0
It is evident that all the parameters are correlated on an average, by having association
with other parameters, except ECA got a negative association with FS for one year.
The following Table-9 gives information about the Total Scores of each of the B-Schools
secured from all the parameters of assessment and their average score has computed (as
we are focusing on one B-School in our Case Study, we have taken data of only top 15 BSchools from the list in order to reach the future targets):
285
2004
2005
Average
Rank
Score
Score
Score
Score
992.9
999.88
1110.6
989.78
1104.64 882.69
992.37
971.32
1048.45 827.09
948.95
866.01
1046.89 807.62
906.84
837.63
925.82
807.42
856.96
10
854.67
875.39
801.11
843.72
11
837.93
858.72
790.9
829.18
12
800.02
858.52
784.09
814.21
13
775.21
855.66
756.57
795.81
14
774.99
810.05
726.94
770.66
15
763.37
809.91
726.84
766.71
912.94
1007.81
0.954427
R Square
0.910931
Adjusted R Square
0.904079
286
Standard Error
1.385067
Observations
15
ANOVA
Significance
Df
SS
MS
Regression 1
Residual
13
24.93933 1.91841
Total
14
280
Standard
Regression
Coefficients Error
t Stat
P-value
1.01E-
Intercept
30.46832
1.981132
15.37925
09
3.37E-
Score
-0.02335
0.002025
-11.5306
08
As the correlation Coefficient between Ranking of a B-School and Total Score is positive and
is 0.95 with a R2=91% (only 8% other factors influencing), So, we can form the Regression
Equation as
Y=a+bx
Also, using the above Regression Equation, predictions were done for possible scores of 800,
900, 1000 (as currently the Case Study B-School scored around 700) and given below:
Total
Rank
Score
(Y)
(X)
14
800
12
900
10
1000
287
Also, the forecasted Rank values are given as 14, 12, and 10 when the expected Total Score is
800, 900 and 1000 respectively. This means that when one unit change is there in the total
score (100 points) there will be 2 units change in the Rank.
So, any Institute which was at 15th Rank last year and moved to 10th Rank this year can be
taken as benchmarking. The following are such Institutes:
S.P. Jain Institute of Management & Research, Mumbai (9th to 5th Rank) -West
Action Plan-I:
Task Force (with internal Faculty) on Delivery -Curriculum Restructuring and change
of Pedagogy
Action Plan-II:
Action Plan-III:
Develop Networking by MOU with Foreign Universities for Exchange Programs due
to globalization
Planning to have their own campus in next 5 years with a world class Infrastructure
Conclusion:
The Institute under Case Study has moved to its own large campus later in 2009 and got its
International Accreditation.
approach and started 2 Programs in Healthcare Management as also Banking & Financial
Services as Special Programs. This made the Institute under Case Study to move to a better
position in recent years under stiff business competition.
Recommendations:
In India now the Regulatory Agencies like AICTE, UGC are insisting accreditation by the
NBA, NAAC, etc., in order to get Quality in the Management Programs.
Very few
Institutions have International accreditations like ACBSP, IACBE, IAO, EQUIS, AMBA and
AACSB, etc. Autonomous Institutions are working on quality in order to sustain their
business. Students should understand that two years hard work will give 40-50 years of a
good career, if they involve in all the activities of a B-School. Faculty should be unbiased
while assessing the students in terms of awarding grades. One should use bell curve while
normalising the grades in each course. The Faculty in B-Schools should take up the Five
responsibilities as KPIs (Key Performance Indicators) Teaching, Administration, Research,
Training, and Consultancy. HR Departments of B-Schools should take these parameters
while doing the performance appraisal along with bell curve. Agencies that are working on
B-School ranking should also consider on the above factors in addition to the Student Intake
and their Placement Offers. Alumni Database should be taken for betterment of the BSchools and Institutions should use Alumni from Admissions to Placements.
289
The B-Schools should continuously engage themselves in research using their own past Big
Data by maintaining their MIS reports. Similarly, they should compare themselves with the
peer level institutions and change the Bench-marking Institutions time to time. B-Schools
should work on their strategies using the tools of Big Data pertaining to the Management
Education in the country.
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this is leading to an emergence of innovative practices to allow business and public service to
operate at a higher growth rate in an environment where the support systems are getting
augmented concurrently (Chandra, Jain, 2007).
Logistics sector in India is highly segmented and unorganized (KPMG, 2007) which is the
major cause for the industry to be more volatile and uncertain. Policy changes by the
government (Chandra, Jain, 2007) are only adding to woos. Indian logistics industry faces a
fiercely competitive and volatile business.
VUCA talks on systemic failures and behavioral failures which are imperative to
organizational failure. These elements present the context in which organizations view their
current and future state. They present boundaries for planning and policy management. They
come together in ways that either confound decisions or sharpen the capacity to look ahead,
plan ahead and move ahead. (Abidi, Joshi, 2015).
This research paper was able to understand the most common problems/challenges the
logistics industry is facing. Fragmentation, role of multiple middlemen, disintegration/lack of
communication between participating partners, difficulty in order procurement, picking &
sorting are the most common problems that were identified. These problems are the major
cause for the organizations not able to perform well in the competitive, volatile and uncertain
environment. The study also identified the following benefits the organizations can get by
implementing ICT solutions - getting accurate information, reduced overall cost, reduced the
overall waiting period of the fleets, increased visibility to the customers, more opportunities
for business expansion and can have better control over their business. The study concludes
with proposing available ICT solutions in addressing the issues identified - implementing
technologies like GPS, RFID, Bar coding, Forecasting tools, Warehouse management
systems, Transport management systems, Online portals to name a few.
Key Words: VUCA, Logistics, ICT, Indian logistics Industry, ICT in logistics 4
299
Introduction
Business competitiveness is nothing new for any business establishment given the current
scenario. Any businesses, irrespective of their years of existence, across the domains have
gone through various ups and downs which are inevitable. These variations could be due to
various internal and external factors. The internal variations are usually caused by people and
processes as these two are an integral part of any organization and take part in all the decision
making processes. The external variations are the results of various known and unknown
factors. There are organizations which have combated these variations/uncertainties and there
are organizations which just succumbed under the tremendous pressure. Those who continue
to exist are successfully able to foresee the turbulent market behavior which is the result of
many factors. Volatile and uncertain markets & economies are also among those factors that
add to market turbulence. Volatility and uncertainty in the likes of demand & supplies,
government policies, changing trends among the consumers, technology, buying pattern, have
become very common in the market place. In todays competitive scenario, there is no
business which is not affected by volatile, uncertain, complex and ambiguous economic
conditions. It has become a part of their routine.
VUCA stands for volatility, uncertainty, complexity and ambiguity. Historically, the strategic
term was used by the US Army in late 1990s for the post-Cold War world. However, VUCA
has become a popular term among business leaders in recent years, especially after the 200809 financial crises, as a clear reflection of the modern world. It is even believed that VUCA
has become the "new normal"1.
1 Krungsri Research
2 www.statista.com
Latest innovations on the World Wide Web (www) have led to a huge transformation in the
way the world exists. It has had a huge impact on the lives of the people and the business
establishments in the way they function and live. The consistent and exponential growth of
the e-commerce industry (the global CAGR of e-commerce industry is set to be 10.7%.2)
across the 5
300
globe has triggered insecurity among the establishments in their business processes, making
the scenario more volatile and uncertain. Not to forget market complexities and ambiguous
future.
The volatility and uncertainty in internal and external environment has made logistics issues
more complex. Order fulfilment, picking & sorting, customer responsiveness, integration
among the participating partners and flexibility are the key issues to respond to market
volatility and uncertainty thereby gaining an upper hand in this competitive environment.
Indian Logistics Industry
The logistics industry across the world rests on the pivotal idea of reducing costs for
customers and providing efficient services. In India, the logistics industry has been growing
by leaps and bounds. Although the Indian logistics industry is recording a steady growth, it
seems to be somewhat stagnant at crossroads. Thanks to the ongoing global economic
uncertainty and its impact on Indian economy. But given the various initiatives by the
Government of India (Make in India, Digital India, Smart Cities development, Establishment
of Food Parks are some of the examples), it may not wonder many if Indian economy will
walk past this uncertainty. Logistics industry in particular has well positioned itself to post an
exponential growth owing to these initiatives, focus on developing infrastructure, proposal to
introduce GST, rise in the e-commerce industry, rising investment in the sector, to name a
few. This offers opportunities across the spectrum for companies in transportation, storage,
distribution, and allied services, according to a report by Motilal Oswal Securities Ltd3.
3 Logistics|Transformational Times, March 2015, Motilal Oswal Securities Limited
4 Mega Trends in the Indian Logistics Sector for 2015-16, Frost and Sullivan and the CII
Institute of Logistics
According to the latest research by Frost and Sullivan4, the Indian logistics market recorded
revenues of about US $104.10 billion in 2014, witnessing a growth of about 4.9 percent over
the previous year. Transportation accounts for about 60 percent of the market revenues. The
Indian logistics market is likely to witness consistent growth of around 6-7 percent every year
during the period 2014-2020 and reach revenues of about US $150-$160 billion by 2020. 6
301
302
On the other hand, ICT has witnessed exponential development that has been strongly
influencing the logistics services industry, making the companies involved, transform
themselves from brick & mortar to brick & click in a very short period of time. This has
opened up challenges among the competing logistics organizations across the globe. The
scene is not as good in India. Reasons may be many. Unlike in some developed countries, the
Indian logistics industry lags behind in adapting ICT. This can be attributed to constraints on
investment in ICT, highly unorganized, varying levels of professionalism, traditional
resistance to change, etc.
Volatility in Logistics Industry
According to Prem Verma, chief executive officer at TML Distribution, which is Tata
Motors outbound logistics division, the slowdown and lack of legislative progress have
taken its toll on the logistics market in some respects. Automotive Logistics Magazine in
2013 reported that the government is struggling to cut a growing budget deficit, while
bureaucracy and corruption at both central and state official levels are thought to be holding
back considerable amount of investments, particularly in Indias woeful transport
infrastructure. As the head of procurement at a leading OEM, R. Dinesh, co-chairman, CII
Institute of Logistics Advisory Council, said, "Volatility is the biggest problem in today's
environment." Volatility erodes the value of forecasting, production planning, and scheduling
and creates problems with under- and overcapacity.
A research report published by A T Kearney focuses on the logistics cost in India. It goes on
to claim, based on their research analysis, that the cost of logistics has a big impact on the
supply chain because of India's predominant use of road transport. Logistics costs as a
percent of sales are about 1 to 1.5 percent higher than in other Asian markets (as represented
in the figure). Fuel and wages, which drive up road transport costs, are expected to increase. 8
303
304
forecast the new world, where so many structural changes are taking place that cycles are no
longer obvious. Therefore, what we need is more systems thinking, greater room for
imagination, and better acceptance of highly varied views and stances.
While Indian economy did not witness a significant slow-down when global volatility first
started peaking in 2008, recent years have seen Indian business also searching for growth.
The India economy has significantly slowed from 9.5 per cent to 4.5 per cent, rupee
depreciated from 40 to 63, even the industrial output has fallen. While most companies
recognize the need for action, few are able to respond appropriately and on time. Manish
Chandra, Managing Director, Accenture Strategy Operations, explained, "A global research
indicated that businesses are aware of the challenges - for instance, 90 per cent of the
companies believe that establishing robust systems and process in place is important to
address volatility, only 10 per cent of the companies have implemented the same. And these
10% companies are 75 per cent more profitable than their peers.
Surajit Mazumdar, 2013: Contrary to many optimistic perceptions about the Indian
economy's future prospects, this paper argues that the next two decades will be a period of
great uncertainty. A path pockmarked with great economic and political turmoil, rather than a
sustained and smooth process of economic expansion is what is likely. These are inherent in
the growth trajectory of the Indian economy which will continue to be biased towards
services and construction activities rather than manufacturing and which will bypass the
majority of Indians. If there is to be any different story, it will not come from the economic
trajectory endogenously producing a shift to a more stable trajectory. Rather, it is the politics
of redistribution that it may give rise to that has to be the source of change. The fact that it
may give rise to such a politics does not, however, mean it will.
Diatha Krishna Sundar, 2001, states: Historically Indian transport sector is burdened with
low end IT solutions, stand-alone applications, very labor-intensive operations and lack of
standard equipment usage across the transportation companies. The low skill level of the
workforce is also a major impediment in transforming this industry into exploiting IT
services. Besides these, the low profit margins, lower yield miles per truck per month due to
bad conditions of the roads are 10
305
discouraging trucking companies from exploiting the possible IT enabled services. The
government agencies involved in facilitating the material movement, like central excise and
customs, regional transport departments, toll and tax collection agencies is not yet moved into
E-Governance paradigm creating a major void in transforming the whole logistics industry
into information age.
Diatha concludes that The "virtual logistics network framework" addresses services in the
areas such as asset management, logistics productivity, global reach, inventory chain
optimization, distribution management, reverse logistics, warehouse management, transport
capacity matching, transport brokerage, and real time interface with federal agencies for
speedy document clearance. In addition, if all the check posts are linked with concerned
government agencies the delay could be considerably reduced. These processes in turn
increase the productivity of the truck and enhance the profitability of operations.
Pankaj Chandra, Nimit Jain, 2007, state the following: Use of technology is quite limited
both IT and engineering equipments in order to increase productivity and service. An inappropriate evaluation of the diverse benefits of technology has led to higher usage of manual
labour across the logistics industry whether it is in the distribution activities or within plants.
Technology in the logistics chain is being upgraded bringing better visibility on customer offtakes (though an absence of cash registers and the accompanying regulatory discipline to
avoid tax evasion stand in the way of automated data updation). Introduction of more
efficient transport technology and mobile communication has the potential of changing the
logistics practices in the industry. Increasing competition and the low penetration of IT also
implies that the scope for change is immense and imminent. The need is to link physical
logistics processes with communication technologies building on the strengths of the IT and
mobile communication industries. While the use of IT for logistics management is increasing,
it is largely limited to large size firms. 11
306
organizational growth
framework for better ICT usage in logistics organizations
METHODOLOGY
A descriptive study was conducted by 50 randomly selected samples from the industry. For
the research purpose, both primary and secondary data are utilized. Primary data was
collected through structured questionnaire. The secondary data sources are various published
reports that are related to the research topic. Data analysis was conducted using MS Excel
(for initial tabulation of data, and simple data analysis) and IBM SPSS (for arriving at cross
tabulation, descriptive statistical measures).
LIMITATIONS OF THE STUDY
fragmented one can find organizations with branches across in the city.
technology.
about the technology and the how it may help their day to day processes.
12
307
MAJOR FINDINGS
Demographics:
the findings reflect the fact that though firms have flexibility in terms of operations, decision
making, expansion, diversification, the same attributes may also cause disadvantage to the
firm in case one of the partners has a problem/casualty.
understand the nuances of the industry so as to decide what is best for them in order to be
competitive.
less number of fleets and are dependent on other fleet owners in case of demand-supply
mismatch.
Adaption of ICT:
n understanding the fact that though ICT is in use in the industry, it is
limited mostly to access internet and perform basic activities classified under office
automation.
grating
partner in the industry to fulfill the customer needs. This indicates how fragmented the
industry is and the need for integration among them.
Order Procurement:
are
organizations who procure directly from their clients, intermediaries contribute to the
maximum.
there are organizations who get the orders directly from the customers, a combination of
direct orders and through intermediaries always work.
13
308
309
IT helps
At the India conference organized by Automotive logistics magazine, Vinodha Jeyanthilal,
India General Manager, IT Learning and Development, Ford Motor Company, quoted, one
of the most significant developments for aftermarket is Fords IT implementation, which will
give the carmakers spare part network significantly higher levels of visibility and
automation. This system will integrate all of the countrys operators onto a single software
platform for forecasting and inventory planning. She continued saying some of the
systems main features include a centralised forecasting across all of Fords part depots,
along with an automatically created bill of distribution. Transport and routing will also be
determined by the system. We expect that we will be able to carry less inventory as we better
integrate the supply chain.
Terra Technology, that helps companies outperform in volatile markets through automated
and mathematically-sophisticated supply chain software solutions, has published in its
website that mitigating market volatility risks has become a boardroom concern across the
globe. Though market volatility is beyond the ability for individual companies to control, it is
possible to control the effects of volatility with new forecasting technology. New algorithms
to automate real-time processing of masses of data and to extract meaningful information
from the noise now provide the means to control the effects of volatility. Lightening your
inventory footprint through better forecasts reduces risk in several key areas, the largest of
which is demand uncertainty. According to the A T Kearney research analysis, technology
and automation can help the supply chain and logistics industry in many ways as mentioned
in the figure. 15
310
Fig 3: Technology and automation solutions for the logistics and supply chain industry
CONCLUSION:
Every problem/challenge has a solution. With the technology helping the man kind reaching
out to the universe, it is not an herculean task for the tech providers to offer technology based
solutions to the organizations that help them survive the stiff competition. A well-defined
problem is half solved. Once a problem is clearly understood, there are solutions available for
the same. Order procurement, Order picking & sorting, routing & scheduling, tracking &
monitoring the consignments, documentation, integrating with other organizations for
effective order fulfilment, forecasting, warehouse management are some of the logistical
functions which can be effectively handled by implementing technologies like GPS, RFID,
Bar coding, Forecasting tools, Warehouse management systems, Transport management
systems, Online portals to name a few. 16
311
SUGGESTIONS:
Based on the fact findings from the research work, it can be suggested that the organizations
in the logistics industry must leverage on the advantages that the ICT is offering. As found by
the research, it is suggested that an ICT based system must be commissioned to integrate
organizations in the industry in order to coordinate fleet movement and order procurement for
mutual benefit. This system should act as an aggregator of the fleet owners and the
intermediaries. This will not only benefit the fleet owners and intermediaries, but also the
customers in terms of efficient and effective delivery of consignment. Today, we can see
many such instances where aggregation of fragmented entities is working more efficiently
than when they worked when they were an independent entity. OLA Cabs, GoGo Trucks,
OYO Rooms are some industry specific examples of successful aggregation. 17
312
Bibliography:
Responses, IIMB working paper
2004
Challenges, IIMA Working Paper
313
DR. GEETHA. R,
ASSOCIATE PROFESSOR AND HOD, DEPARTMENT OF MANAGEMENT, RJS
INSTITUTE OF MANAGEMENT STUDIES, KORAMANGALA, BANGALORE
Abstract:
Gen-Y includes all those people born between 1976 and 2001(US Bureau of Labour
Statistics). They are called by different names such as millennials, Screenagers, echo
boomers, tech savvy generation, Gen-next, boomerang generation and so on. There are
around 2.5 billion millennials world-wide (Christial Kurz, Research & Insight, Viacom
International Media Networks, November 2012) some of whom are employed, while others
are still pursuing their education. Millennial population constitutes majority of the global
labour pool of 3 billion workers (Torres, Raymond (ed.) 2013). The U.S. Bureau of Labor
Statistics predicts that by 2030, hyper-connected, tech savvy millennial generation will make
up almost 75% of the global workforce. This new generation is highly tech literate and
accustomed to electronic and mobile gadgets like- smart phones, personal computers, tablets,
laptops and other forms of digital technology. Screenagers are multi-taskers, highly
competent and updated. They seek- collaborative and flexible learning environments, instant
recognition and performance feedback, transparency and quick communication. Since most
of Gen-X workforce is likely to retire from their positions in the next ten years, there is an
immediate call for business enterprises to plan for succession, by preparing Gen-next to take
over from their predecessors. But the average attention span of millennials is just 8 seconds;
which is much shorter compared to the older generations. Besides Gen-Y people get fidgety
and restless with obsolete enterprise learning and developmental strategies. It is indeed a
great challenge for Organizations to develop learner-centric, proactive developmental
strategies to satiate and sustain the interest of the Gen next and to enrich their learning
experience. This empirical paper discusses about opinion of millennials about the
effectiveness of Electronic & Mobile Technology based Learning and Developmental
strategies in enticing, engaging and enriching their learning experience. A sample size of 110
314
Introduction:
Learning and development (L & D) is a vital business process and strategy
which if used effectively can yield definitive results like enhanced productivity and
performance. Organizations across the world are now faced with the challenge of designing
L & D strategies that suit the diverse learning styles of their multi-generational workforce.
Currently most of the business firms are using blended learning strategies by integrating
diverse techniques like classroom, on-the-job, experiential learning, e-learning and mlearning. It is predicted that by 2020 three fourth of the workforce will comprise of
millennials who are tech-competent and tech-savvy. Hence to facilitate screenagers to gain
value and to enjoy the process of learning and development, organizations are integrating
electronic and mobile technology.
Technology facilitates development and application of knowledge, devices,
machines, crafts, systems, tools and techniques for the purpose of - solving a problem,
improving or modifying a pre-existing solution to a problem, achieving a goal or for
process improvement. Organizations across the globe are integrating technology with their
business practices in order train employees, to produce products, simplify and improve
processes, reduce costs, for talent management, or to attain competitive advantage or for
competitive compliance. There are various forms of technology. Among them electronic
technology and mobile technology are two distinct forms of technology which will be used
most extensively all over the world in near future.
Electronic technology and mobile technology have revolutionized the way in
which organizations perform their day-to-day operations, particularly so in the Human
Resource Development domain, where IT and portable technology have redefined the way
in which HR departments impart training and development to their personnel. It has become
315
a matter of compliance for organizations to adopt latest technology to sustain the interest of
their millennial workforce. Electronic and Mobile technology are having a tremendous
impact on Learning and Developmental activities in organizations .When Electronic and
mobile technology tools are adopted for Learning and Development it is termed as
EMTBLDS (Electronic and Mobile Technology Based Learning and Development) or Elearning and M-learning.
Organizations may develop the learning modules based on- the training needs of the aspirants,
technology and media available, budgetary sanctions and security issues.
LCMS
LMS
Authoring
Tools
Webniars
ELearning
Strategie
s
Web 2.0
Web
Conferences
Simulations
Mind
Mapping
317
LMCS
Ice
breakers
Authoring
Tools
Gamification
MLearning
Strategies
energizers
group
activities
Simulations
Collaborative
Learning
Tools
M-Learning Application
Vendor/Tool
318
Dream
Weaver(Adobe
Product)
Adobe
Device
applications
Central
Phone Gap
Build apps in HTML and JavaScript and still take advantage of core
features in iPhone/iTouch, iPad, Android, Palm, Symbian and
Blackberry SDKs
Chalk Pushcast
On point Digitals
user's mobile phones, and track their progress and test scores
CellCast
Clickatell.com
Mobl21
Word Press
Enables web sites and applications to send and receive text messages
Certpoint VLS
Titanium
319
ETBS
Enriches the
Learning
Learning
Experience
of from The Technology
TheStrategies
theoretical basis for the research was
drawn
Millennials
Acceptance Model (TAM) theory of Fred Davis et. al. It is an information systems theory
that models how users come to accept and use a technology. The model suggests that when
MTBSa number of factors influence their decision about
users are presented with a new technology,
how and when they will use it, notably. The focus of the present research is to examine the
effectiveness of E & M Technology based learning and developmental strategies on enriching
and engaging the millennial workforce. The two dimensions considered for the study includeETBLD and MTBLD Around ten constructs each were used to measure and quantify the
effectiveness of these two dimensions.
This empirical paper examines the effectiveness of various E-learning and MLearning tools and techniques used in IT industry in order to enhance the job related skills
and competencies of millennial workforce. An attempt was also made to investigate and
examine whether the massive investments made on e-learning and M-learning tools
facilitated in enriching the learning experience of the Gen-Y or not.
Significance of the Study
A research report by ambient insight has found that the investment in learning
technology across the globe has increased tremendously over the years and it stands at USD
2.4 billion in 2014 compared to nearly USD 1 billion in 1999. The main reason for this
increase in investment is to match the learning styles of the new generation workforce. There
is a need to justify the rationale behind such huge investments on E and M technology
adoption for Learning and Development of Gen-Y workforce. Through the current research,
an effort is made to examine the opinion of millennial workforce in IT industry regarding the
effectiveness of E and M learning strategies.
Objectives of the Research
There are fewer studies that reflect the opinion of millennial workforce on the
effectiveness of E and M learning strategies adopted by the organizations. Hence the current
research was undertaken to realize the following objectives:
320
Research Methodology
Exploratory and Descriptive research methods were used to realize the
objectives of the research. The key objective of the research was to examine whether E & M
Learning and Development strategies in IT industry help in engaging and enriching the
learning experience of millennial workforce or not. Primary data was collected through
opinion survey techniques like direct interview, structured questionnaire, e-mail survey and
observation. Millennials employed in select IT firms were chosen as the target respondents. A
Structured questionnaire was used as a research instrument for garnering required data for the
present research.
Secondary data was extracted from various archives like- books, e-newspapers, magazines,
journals and internet search. Some of the online data bases used were: ProQuest, EBSCO, Jgate, SSRN (Social Science Research Network), Google scholar, Wiley online library, Taylor
and Francis, Rout ledge, Wikipedia and other repositories.
Sample Size and Technique: The sample units of 110 millennials employed in IT firms
Bangalore city were chosen. The samples were drawn based on probability sampling
technique. Simple random sampling technique was adopted while choosing the sample units
for the study.
1. Adoption of E and M Learning and development strategies is in the nascent phase in most of the
IT firms and hence the respondents were not very clear in giving their opinion.
2.
The data collected is based on the personal bias and opinion of the respondents. Hence the
reliability and validity of the data collected is based on the bias and prejudices of the
respondents
Section
Particulars
Plan of Analysis
Reliability Statistics
Demographic Profile
ETBLD Dimension
MTBLD Dimension
Hypotheses Testing
Regression
N of Items
.937
22
The reliability analysis was conducted as shown in table-3 above by computing the
Cronbach alpha () for each moderating variable used to assess the effectiveness of ETBLD
and MTBLD. The Cronbach alpha for twenty two items or independent variables used to
measure the constructs is 0.937 indicating that the measures have acceptable internal
consistency since they are much above Nunn allys (1978) threshold of 0.70.
Section-2: Table -4: Demographic Profile of the Respondents
Demographic
Profile
of
the
Respondents
N= 110
Demographic Characteristic
Category
322
Frequency
Percentage
Male
74
67.3
Female
36
32.7
15-20 years
02
01.8
21-25 years
52
47.3
26-30 years
30
27.3
31-35 years
10
09.1
36-40 years
16
14.5
Graduate
67
60.9
Post Graduate
26
23.6
Others
17
15.5
Entry Level
45
40.9
Middle Level
57
51.8
Senior Level
08
07.3
< 2 years
30
27.3
3-5 years
45
40.9
6- 10 years
23
20.9
11-15 years
10
09.1
02
01.8
Gender
Age
Qualification
Job Position
Experience
15 years
Section-3:
Table- 5: ETBLD & MTBLD Dimension-Wise Mean and Standard Deviation
323
Descriptive Statistics
N
Minimum
Maximum
Mean
Std. Deviation
ETBLD
110
1.60
4.10
3.2273
.90320
MTBLD
110
2.20
4.30
3.3273
.77648
Valid N (listwise)
110
Mean scores for ETBLD and MTBLD were obtained by aggregation of all the factors used in
their assessment divided by the number of factors considered for each dimension. The mean
score of ETBLD is 3.2273 with a standard deviation of 0.90320 and the same for MTBLD is
3.3273 with a standard deviation of 0.77648. This implies that the millennials agree to an
extent that E and M technology helps in enriching their learning experience as the response
lies between 3(Some What agree) and 4( Agree) for both the dimensions.
Section-4:
Hypotheses 1:
Ho: Cetirus Paribus, there is no significant Correlation between ETBLD factors and learning
enrichment of millennial workforce.
Ha: Cetirus Paribus, there is significant Correlation between ETBLD factors and learning
enrichment of millennial workforce
R Square
Adjusted R Square
.947a
.897
.896
.29191
.962b
.925
.924
.24960
.981c
.962
.961
.17848
.984d
.969
.968
.16174
Predictors:
((Constant),
Learning
Content
Quality(CQ),
Ensures
Dynamism
324
and
Sum
of
df
Mean Square
Sig.
935.484
.000b
660.153
.000c
895.124
.000d
823.549
.000e
Squares
1
Regression
79.715
79.715
Residual
9.203
108
.085
Total
88.918
109
Regression
82.252
41.126
Residual
6.666
107
.062
Total
88.918
109
Regression
85.542
28.514
Residual
3.377
106
.032
Total
88.918
109
Regression
86.172
21.543
Residual
2.747
105
.026
Total
88.918
109
Unstandardized
Standardize
Coefficients
d
Coefficients
325
Sig.
Std. Error
.336
.088
Content
.118
.031
Dynamism
.408
Learning
(Constant)
Learning
Beta
3.797
.000
.198
3.844
.000
.034
.486
11.966
.000
.228
.037
.217
6.170
.000
.106
.022
.175
4.907
.000
Quality(CQ)
Ensures
and Flexibility(DF)
Self-Paced
(SF)
Development(AL)
a. Dependent Variable: E-Learning Enriches Millennial Learning and Development
326
Step-wise regression analysis was used to test hypotheis-1 stated above. E-Learning Enriches
Millennials Learning and Development experience (Dependent Factor) based on four
independent factors namely- 1) Quality content (CQ) 2). Ensures Dynamism and flexibility
DF), 3). Self-Paced Learning (SP) and 4) Ensures Anytime Learning (AL). Significant
regression results were found as indicated below:
1. F(1, 108) =935.484; P=.000 <0.05 with R2 = 0.897
2. F(2, 107) =660.153; P=.000 <0.05 with R2 = 0925
3. F3, 106) =895.124; P=.000 <0.05 with R2 = 0.962
4. F(4, 105) =935.484; P=.000 <0.05 with R2 = 0.969
The opinion of millennial workforce about the ELEMLD based on 4 independent factors namely
Content Quality (CQ), Ensures Dynamism and Flexibility (DF), Self-Paced Learning (SP) and Any Time
Learning (AL) may be interpreted from the following regression equation formed from the
unstandardized Beta Coefficients in Table-8
ETBLD= 0.336+0.118 CQ+0.408 DF+ 0.228 SP+0.106 AL
From the above equation it can be observed that dynamism and flexibility of content with a
coefficient value of 0.408 has significantly high influence on ELEMLD followed by Self-paced
learning mechanism (coefficient 0.228) and Content Quality (coefficient 0.118). Any time learning
option (coefficient 0.106) though significant has the least influence on ELEMLD when compared
with the other endogenous factors in the equation .From table-7 and Figure-4 above it can be
observed that all the four factors representing ETBLD have significant impact on the learning
enrichment of millennial workforce. Hence Null hypothesis H0 is not accepted indicating that a
statistically significant, positive and direct, correlation exists between the ETBLD factors and
learning enrichment of millennial workforce.
327
Hypotheses 2:
Ho: Cetirus Paribus, there is no significant Correlation between MTBLD factors and learning
enrichment of millennial workforce
Ha: Cetirus Paribus, there is significant Correlation between MTBLD factors and learning
enrichment of millennial workforce
R Square
Adjusted R Square
.954a
.910
.909
.23455
.962b
.926
.924
.21360
.979c
.959
.958
.15951
.990d
.980
.979
.11182
Sum
of
df
Mean Square
Sig.
1086.592
.000b
666.713
.000c
825.633
.000d
Squares
1
Regression
59.777
59.777
Residual
5.941
108
.055
Total
65.718
109
Regression
60.836
30.418
Residual
4.882
107
.046
Total
65.718
109
Regression
63.021
21.007
Residual
2.697
106
.025
328
Total
65.718
109
Regression
64.405
16.101
Residual
1.313
105
.013
Total
65.718
109
1287.712
.000e
Unstandardized
Standardize
Coefficients
Sig.
8.928
.000
Coefficients
B
Std. Error
Beta
(Constant)
.647
.072
.179
.017
.356
10.370
.000
.214
.012
.398
17.285
.000
are
.253
.016
.398
15.903
.000
.143
.014
.180
10.521
.000
Networking
MTBLD has Eliminated Barriers
of Time and Place
M-Learning
Outcomes
Measurable
329
Step-wise regression analysis was used to test hypotheis-2 stated above- M-Learning
Enriches Millennials Learning and Development experience (Dependent Factor) based on
four independent factors namely- 1) Content Sharing & Networking(CN 2). Eliminates Time
and Place Barriers(TP), 3). Outcomes are Measurable(MO) and 4) Establishes Work Life
Balance(WLB). Significant regression results were found as indicated below:
330
Summary of Findings
1. Technology integration strategy for training Gen-Y workforce was found to have yielded
significantly favourable results as 96 percent of the millennials reported that they enjoyed
technology enabled learning sessions.
2. Nearly 95 percent of 110 millennials surveyed owned smart phone device, 83 percent of them
owned a PC, another 72 percent of them owned a laptop and 42 percent of them owned a
tablet. This indicates that penetration of smart phone device is very high among millennials.
3. Almost 79 percent of the millennials reported that their organizations are employing both Elearning and M-learning tools effectively. However remaining 21 percent were unsure about the
same.
4. The quality of content delivered through E & M learning was rated as high as indicated through a
response rate of 65 percent.
5. E-learning was appreciated for its rich features like self-paced learning (Response rate- 47%),
simple and easy content accessibility(59 Percent response rate), facilitating both synchronous
and asynchronous learning(37 percent response rate), quick assessment of learning ( 26
percent), media collaboration (32 percent), instant feed-back mechanism(65 percent) and
provision for content verification from source(56 percent).
331
Suggestions
The penetration of portable devices, particularly the smart phones is very high among the
echo boomers .Besides they are passionate about global trotting. Mobile learning which
facilitates any time anywhere learning would be an ideal option for them so organizations
should redesign their training programmes by integrating M-technology.
Web 2.0 technology based applications like Social media, wikis, blogs, RSS feeds, videos,
podcasts and other similar applications may be used for engaging Screenagers in Learning
and Development.
In the present scenario, there is a combination of both Gen-X and Gen Y in workplace. GenY cohorts are highly techno-competent as compared with their Gen-X cohorts. Besides the
attention span, learning style, pace of learning differ between the two groups.
Since
organizations have to cater to the diverse needs of both the groups, blended learning
structure would be a better solution.
Most of the Millennials reported that their organizations are using Basic information
technology applications for training and development. Business enterprises will be able to
reap greater benefits by employing advanced tools.
332
Conclusion
According to latest report from e-marketer, Smart phone penetration around the globe
has been accelerating with nearly 1.76 billion people constituting 25 percent of the world
population using smart phones (2014). Nearly 95 percent of the millennial workforce have
access to one or another form of portable technology device. Three fourth of the workforce in
the world will comprise of Gen-Y in the near future. Organizations have to leverage from
technological advancements. Most of the IT firms are already gearing up to reap the benefits
of mobile technology based learning in addition to electronic technology enabled training and
development programmes. Since the accessibility to mobile learning content is easy and
simple with the increased penetration of smart phones and other portable technologies, IT
firms have started redesigning their learning platforms by making best use of the available
applications. Besides, the attention span of Gen-Next is very low and stands at 8 seconds as
quoted earlier. Sustaining interest of Screenagers is a real big challenge for organizations
since they are fidgety, restless and very demanding. Through the survey it was found that
most of the IT firms have been extensively using e-learning tools for the development of their
millennial workforce. With the onset of smart phone technology and with the obsession of
Gen-Y with it, organizations are forced to rethink and design new ways of training their
workforce. Millennials expressed that they prefer M-learning and e-learning over traditional
learning techniques as it is self-paced, content rich, challenging, fascinating, value adding,
flexible, dynamic, thought provoking thereby enticing, engaging and enriching their learning
experience.
Journal References:
333
Brown, T. (2003, June). The role of m-learning in the future of e-learning in Africa. In 21st
ICDE World Conference. Retrieved from http://www. tml. tkk. fi/Opinnot (Vol. 110).
Georgiev, T., Georgieva, E., & Smrikarov, A. (2004, June). M-learning-a New Stage of Learning. In International Conference on Computer Systems and TechnologiesCompSysTech (Vol. 4, No. 28, pp. 1-4).
Holzinger, A., Nischelwitzer, A., & Meisenberger, M. (2005, March). Mobile phones as a
challenge for m-learning: examples for mobile interactive learning objects (MILOs). In
Pervasive Computing and Communications Workshops, 2005. PerCom 2005 Workshops.
Third IEEE International Conference on (pp. 307-311). IEEE.
Monahan, T., McArdle, G., & Bertolotto, M. (2008). Virtual reality for collaborative elearning. Computers & Education, 50(4), 1339-1353.
Peters, K. (2007). m-Learning: Positioning educators for a mobile, connected future. The
International Review of Research in Open and Distributed Learning, 8(2).
Reeves, T. C., & Oh, E. J. (2008). Do generational differences matter in instructional design.
Accessed on, 12(10).
Welsh, E. T., Wanberg, C. R., Brown, K. G., & Simmering, M. J. (2003). E-learning:
emerging uses, empirical results and future directions. International Journal of Training and
Development, 7(4), 245-258.
Webliographical References:
http://www.fiercewireless.com/story/report-global-smartphone-penetration-jump-252014-led-asia-pacific/2014-06-11
http://www.igi-global.com/journals/details.asp?id=...
http://blog.viacom.com/2012/11/the-next-normal-an-unprecedented-look-at-millennialsworldwide/
http://www.bls.gov/opub/mlr/2005/11/art3full.pdf
334
DR.USHA DEVI.N
MLA FIRST GRADE COLLEGE FOR WOMEN
SMT. BHAGYA GB
NITTEE COLLEGE
SMT.SHASHIKALA.K
VIVEKANANDA DEGREE COLLEGE
SMT.RUKMINI.K
RC GOVT. COLLEGE
Abstract
This is an empirical research study which investigates the application of ICT
in rural Colleges, Bangalore. Two hundred and twenty-five (225) teachers
were selected as the sample for the study. A self-developed instrument on
the availability and use of ICT was used for data collection. The instrument
contained 25 items. The reliability co-efficient of the instrument stood at
0.88. The data collected were analyzed using mean percentages. The
findings revealed: acute shortage of learning materials such as online/internet-connected computers, e-mail facilities, multimedia television,
multimedia computer and digital library. It was also revealed that the few
available ones such as off-line/ordinary computers, scanner, printer and
ready-made courseware are not utilized because the teachers lack the
knowledge and skills of computer application. The only material identified
as available and in use is the telephone. It was recommended the authorities
should embark on a massive computer training program for teachers.
Teachers should be trained and retrained through inservice training,
335
336
E-learning should ensure effective pedagogy and curriculum implementation in the computer
age. According to Nicholls and Nicholls (1980), Mkpa (1987), and Offorma (2002),
curriculum implementation is the planning and execution of the contents of curriculum in
order to bring about certain changes in the behavior of the learners and the assessment of the
extent to which the changes take place. The primary purposes of implementation are to
achieve the objectives of instruction, and achieve retention and transfer of knowledge. Elearning is an instructional medium that permits alternative approaches to curriculum
implementation in an ICT age. Richmond (1997) observed that, there is a great link between
the curriculum and ICT and that there are three major areas that technology can influence
learning, including:
337
Similarly, the role of ICT in curriculum implementation is recognized by the Indian National
Policy on Education, where it stated that, the government shall provide facilities and
necessary infrastructures for the promotion of ICT and e-learning. It is against this
background that the researcher intends to find out the extent of availability and use of elearning materials by teachers in rural colleges.
Statement of Problem
The call for application of ICT in colleges is to infuse and inject efficiency and effectiveness
in curriculum implementation. However, in India, ICT is challenged with the problem of
material devices such as computer, computer laboratories, internet and e-mail facilities,
videophone systems and teleconferencing devices, fax and wireless applications, digital
library, digital classrooms, multimedia systems and also there is dearth of trained teachers for
ICT. The problem is that ICT in colleges is challenged by the new technologies in terms of
availability and use. It is against this background that the present study is carried out to find
the answers to the following questions:
1. What are the ICT materials available to teachers for curriculum implementation?
2. To what extent are the available ICT materials currently used by the teachers?
3. What are the strategies for improving the use of ICT materials in secondary schools?
Methodology
The study employed a survey research design. The sample for the study was comprised of
225 teachers who were randomly selected from different colleges. Structured questionnaire
on a four-point scale was prepared. The content validation of the instrument was established
by ten experts. The reliability of the instrument was determined using the Pearson Product
Moment Correlation. A reliability coefficient of 0.88 was obtained, an indication that the
instrument was reliable for data collection. The copies of the questionnaire that were
administered by the researcher were returned and used for computation. The data collected
were analyzed using frequency distribution and mean. Since the items were structured on a
four-point rating scale, the decision rule was based on the mid-point of the scale, 2.50.
Therefore, items with mean scores of 2.50 and above were regarded as agreed or positive
responses while items with below 2.50 were regarded as disagreed or negative responses.
Results:
338
Research Question 1. What are the ICT materials available to teachers for curriculum
implementation?
Table 1: Mean responses on the availability of ICT materials for curriculum implementation
N = 225
S/N
SA
SD
Decision
Off-line/ordinary computers
52
138
23
11
3.03
AV
Telephone/wireless Applications
191
32
02
3.84
AV
On-line/Internet Computers
04
221
1.02
NA
Scanner
43
119
40
23
2.81
AV
Printers
46
152
19
08
3.05
AV
E-mail facilities
10
215
1.04
NA
Multimedia Television
03
222
1.01
NA
Multimedia Projectors
225
1.00
NA
Digital Library
225
1.00
NA
10
35
116
57
17
2.75
AV
Table 1 shows that items 1,2,4,5 and 10 with mean ratings of 3.03, 3.84, 2.81, 3.05 and 2.75 are
available. They include: off-line or ordinary computers, telephone and/or wireless applications,
scanners, printers and ready-made courseware. The Respondents affirmed that items 3,6,7,8 and 9
with mean ratings of 1.02, 1.4, 1.01, 1.00 and 1.00 are not available. They include: on-line or
internet connected computers, e-mail facilities, multimedia television, multimedia projectors, and
digital library.
Research Question 2. To what extent are the available ICT materials used by the
teachers?
Table 2: Mean Responses on the Use of Available Materials
N = 225
S/N
SA
SD
Decision
11
Off-line/ordinary computers
04
08
213
1.07
NIU
12
Telephone/wireless Applications
193
30
3.85
IU
13
Scanner
220
1.02
NIU
14
Printers
04
06
215
1.06
NIU
15
225
1.00
NIU
339
Table 2 indicates that items 11, 13, 14 and 15 are available but not in use. They have mean ratings
of 1.07, 1.02, 1.06 and 1.00. However, the only material available and in use is item 12 that is
telephone and/or wireless applications with mean rating of 3.85.
Research Question 3. What are the strategies for improving the use of ICT materials in
colleges?
Table 3: Mean Responses on the Strategies for Improving ICT learning Applications
N = 225
S/N
Decision
16
3.81
Agree
17
4.00
Agree
18
3.91
Agree
19
3.75
Agree
20
4.00
Agree
21
3.97
Agree
22
3.70
Agree
23
3.88
Agree
24
3.67
Agree
35
Training
3.94
Agree
&
retraining
of
teachers
through
seminars,
The table shows that all the respondents agreed that adequate provision of online computers
and e-mail, and provision of incentives for courseware development, with mean ratings of
4.00 and 4.00 respectively will promote ICT applications in curriculum implementation in
colleges. The table also shows that all respondents somewhat agreed that items16, 18, 19, 21,
22, 23, 24, and 25 with mean ratings of 3.81, 3.91 3.75, 3.97, 3.70, 3.88, 3.67 and 3.94
respectively will promote ICT applications in curriculum implementation in colleges.
Discussion
340
Research question 1, indicates the availability of five out of the ten items listed for ICT
applications. The five that are available are: off-line or ordinary computers, telephone or/and
wireless applications, scanner, printers and ready-made courseware. This supports the
findings of Akinola (2005) in which only five out of the twelve ICT tools needed for
Business Education were available. This study is also consistent with the findings of
Ikemenjima (2005) and Jegede and Owolabi (2008) that there are infrastructural deficiencies
and shortage of facilities, including: computers, computer laboratories and online-classroom
for the study of Computer Education in colleges.
Research question 2, addresses the use of the available ICT materials for curriculum
implementation. The respondents affirmed those items 11, off-line or ordinary computers; 13,
scanners; 14, printers; and 15, ready-made courseware: CD-Rom, etc., were available but not
in use as indicated in the mean ratings of 1.00 for each of them. The respondents indicated
that the only material available and in use is item 12, telephone or wireless applications with
mean rating of 3.85. This confirms the results of Effiong (2005) and Jegede and Owolabi
(2008) that ICT materials such as computers, computer labs, printers, scanners, e-books,
textbooks, workbooks and books on ICT are not available and not in use in colleges.
Research question 3, indicates that the vast majority of respondents agreed with items 16
through 25 as measures to take to improve ICT application in curriculum implementation in
colleges. Providing a massive computer literacy program for teachers had a mean score of
3.81. Adequate provision of online computers and e-mail facilities had a mean score of 4.00.
Connection of classrooms and auditoriums to the internet had a mean score of 3.91.
Procurement of multimedia systems had a mean score of 3.75. Provision of incentives for
courseware development had a mean score of 4.00. Provision of digital libraries had a mean
score of 3.97. Employment of computer technicians for routine repair had a mean score of
3.70. Provision of standby generators for regular power supply had a mean score of 3.88.
Provision of security for e-learning materials had a mean score of 3.67. Training and
retraining of teachers through seminars, workshops, and conferences had a mean score of
3.94. The findings agree with Sundarajan (2005), Evoh (2007), and Nwana (2008) that
teachers should have adequate training for computer education.
341
In view of the problems hindering ICT in colleges, the following recommendations are
offered for prospective and effective ICT learning:
The government should provide digital libraries in every educational institution. The
library is the highest reservoir of knowledge and no educational institution can do
without it. Ensure that each digital library has a server for storage, retrieval, uploading
and downloading of information.
The government should employ technologists and technicians to take care of internet
facilities and equipment and to carry out routine repairs within education facilities.
The government should set up standby generators and uninterruptable power supplies
(UPS devices) to tackle the problem of epileptic or inconsistent power supply in order
to support the use of electronic equipment for e-learning.
References
1. Akinola, C.I. (2005). The Challenges of reform, information and communication
technology in business education, curriculum and information technology. Business
Education Book of Readings, 3(5) 120 125.
2. Becker, H.J. (2000). Whos wired and whos not: Childrens access to and use of
computer technology. Journal of Children and Computer Technology, 10(2) 44-49.
3. Dutta, S. & Bilbao-Osorio, B (2012). The Global information technology report
2012: Living in a hyperconnected world. Geneva: World Economic Forum and
INSEAD.
4. Effiong, J.E. (2005). Business education in the era of information and
communication technology: Issues, problems and prospects. Business Education
Journal, 5(1) 3 7.
5. Evoh, C.J. (2007). Policy networks and the transformation of secondary education
through ICTs in Africa: The prospects and challenges of the NEPAD e-schools
initiative. International Journal of Education and Development, 3(1) 24 30.
6. Federal Republic of Nigerian (2004). National policy on education. Lagos: NERDC
Press.
7. Jegede, P.O. & Owolabi, A.J. (2003). Computer education in Nigerian secondary
schools: Gaps between policy and practice. Meridian: A Middle School Technology
Journal,
6(2)
11.
http://www.ncsu.edu/meridian/sum2003/nigeria/nigeria.pdf.
343
Retrieved
from
for
Development.
Retrieved
from
http://www.i4donline.net/nov05/digitallearning.asp.
19. Tracy, L. (1995). The internet companion. New York: Addison-Wesley Publishers.
20. Uhaegbu, A. (2001). The information user: Issues and themes. Enugu: John-Jacobs
Publishers.
344
DR. A. DHANALAKSHMI
PROFESSOR, ACHARYA BANGALORE B SCHOOL, BANGALORE 560091
Abstract
With around 57% share in GDP of our country, service sector is an mandatory part of trade.
Service includes all economic activities whose output is not a physical product consumed at
the time it is produced and provide added value in forms that are essentially intangible and it
concerns of its first purchaser. This paper is a brief review of the service sector, impact of IT
and ITeS to the service sector and also mentions examples on how technology is helping
employees serve customers more effectively and efficiently.
Keywords: GDP, Mayo Clinic, EMR, UPS
Introduction
Service sector
The services sector with an around 57 per cent contribution to the gross domestic product
(GDP), has made rapid strides in the last few years and emerged as the largest and fastestgrowing sector of the economy. Besides being the dominant sector in Indias GDP, it has also
contributed substantially to foreign investment flows, exports, and employment. Indias
services sector covers a wide variety of activities that have different features and dimensions.
Some services like IT and telecommunications are very sophisticated, involving high
technology and expertise, while some are simple like those of barbers and plumbers. Some
services like transport have high linkages with the industrial sector and some like tourism
have high employment linkages. Some services like railways and port fall under the
345
definition of infrastructure, while some like construction fall under the definition of industry.
Thus there are many borderline inclusions and exclusions.
IT and ITeS
The information technology-information technology enabled services (IT-ITeS) industry has
become one of the significant growth catalysts for India. India continues to maintain a
leadership position in global sourcing, accounting for above 55 per cent of the total global
sourcing market (excluding engineering services and R&D) in 2013 as compared to 52 per
cent in 2012. The ITbusiness process management (BPM) sector (excluding hardware) is
estimated to have grown by 10.3 per cent, reaching US$ 105 billion in 2013-14. Of this,
exports with a major share of 81.9 per cent grew by 13.0 per cent while domestic revenues
fell by 1.0 per cent in dollar terms. Domestic revenue is estimated to have increased by 9.63
per cent in rupee terms. In 2014-15 higher growth is expected in both exports and domestic
revenues.
Technology can be a great enabler for front-line staff, allow for empowerment, and free up
time to focus on customers. However, some technological innovations have been viewed less
favorably. The advent of customer relationship management systems, combined with the
rollout of call centers throughout the world, has transformed the role of the service provider
in large parts of the service sector. That transformation is for better or worse, but poses the
same problems in a new setting when managing people. The jobs that deal with providing
information help, and to an extent, sales, will never be the same again. The technology has
enabled the industrialization of large branches of services. Automated help lines now require
that customers learn new scripts just to get to the correct recorded message. Email enquiries
are answered miraculously from all over the world. It is, however, the call center with its
346
sophisticated call management system that has become the visible symbol of the redesign.
Technology
spotlight
347
medications. When an entry is made, it automatically launches a series of activities associated with
the patients care. For example, consider a person being admitted to oncology department for a
cancer treatment. A physician might place an order for the patient to receive an anti-nausea
medicine 30 minutes before chemotherapy, then receive three different chemical agents at specific
times and in a particular sequence and it might specify that the treatment be repeated every 12
hours. Mayos order-entry system automatically notifies physicians, pharmacists, and others in the
hospital when a particular treatment needs to be performed and monitors dosage amounts and
method of administration (e.g., orally or through a vein).
In addition to a savings of nearly $7 million to its Jacksonville clinic, the automated system makes
Mayo medical staff more effective and improves patient care. For example, when new test results
are reported in a patients file, they are highlighted, so that a nurse or doctor sees them
immediately. Thus, the medical staff spends less time waiting or looking for patients files. By
transitioning to electronic medical records , Mayo has found staff workflow to be better
coordinated in the care of patients suffering from chronic diseases. Thus, electronic medical
records have enables Mayo Clinic staff to be even more efficient and effective in delivering quality
health
care.
Sources: D. Froust, How Technology delivers for UPS, Businessweek (March 5, 2007), p.60;
2010 UPS Annual Report; L.L. Berry and K.D.Seltman, Building a Strong Service Brand:
Lessons from Mayo Clinic, Business Horizons 50(May-June 2007), pp.199-209.
Conclusion
Already organizations are discovering that their survival no longer exclusively depends on
their products they offer, but also on the additional offerings they make to their customers
that differentiate from their competitors. On the other hand, most of consumers nowadays are
also prefer to choose a technology based service delivery and it has also rising some
significant concern about the impact that technology on service quality and how it affects
customer satisfaction levels.
This paper makes an attempt to understand the impact of Technology (IT and ITeS) to the
service sector and also presents some evidence on how technology is helping employees
serve customers more effectively and efficiently leading to a greater customer satisfaction.
References:
1. Patrick, Thibodeau, Offshore Tech Support Still Stirs Controversy, Computerworld 39,
18, (May 2, 2005), p. 7.
348
2. (2013, 10). impact of technology in service industry StudyMode.com. Retrieved 10, 2013,
from
http://www.studymode.com/essays/Impact-Of-Technology-In-Service-Industry-
39448180.html
3.
http://www.insightsonindia.com/2014/07/09/download-economic-survey-2013-2014-pdf/
(accessed on 12.10.2015)
4. Zeithaml, V.A., Bitner, M.J., Gremler D.D., Pandit A.
Integrating customer focuses across the firm (6th Edition). Chapter 11, p.345-346, Tata
McGraw-Hill Edition.
5. Hansda, Sanjay Kumar (2002), Services sector in the Indian Economy: A Status Report,
RBI Staff Studies, Department of Economic analysis and Policy.
349
CHETHAN JAYANTHA
RESEARCH SCHOLAR, DEPARTMENT OF COMMERCE,
BHARATHIAR UNIVERSITY, COIMBATORE
DR. A. DHANALAKSHMI
PROFESSOR, ABBS, BANGALORE
ABSTRACT
Big data has become one of the most important technology trends that has the potential for
dramatically changing the way organizations use information. Big data enables organizations
to gather, store, manage, and manipulate vast amounts of data at the right speed and time, to
gain the right insights. Organization across industries and geographies have started
harnessing the revolutionary potential of the Big data technology. Risk management is an
area in which the potential of Big data is yet to be ventured. This paper gives an insight into
the Big data Technology and process of integration of Big data in the different stages of Risk
management.
INTRODUCTION:
With the advent of Information technology revolution the quantity of data getting
accumulated is enormous. As we are reading the article, the worlds data is exploding in
unprecedented velocity, variety, and volume. Data is getting piled up from every aspects of
our modern day life. Starting from purchases made in stores to the posts in social media sites.
Every day, we create 2.5 quintillion bytes of data so much that 90% of the data in the
world today has been created in the last two years alone (IBM, Bringing big data to the
enterprise). This is big data. The Big data is a gold mine and it is up to the corporates to
capitalize this. Big datas potential has already been harnessed in deferent areas of
management. Risk management is a potential area in where the big data can be embraced.
The structure of the paper is organized into 3 Segments. The first segment concentrates on
understanding Big data, its need and process of harnessing the Big Data. Second segment is
understanding the Risk and Risk management process. The final segment talks about the
application of Big data in Risk management.
Big Data
Need for Information:
The success of an organization depends on the decisions which its management takes. The
well informed decision which is taken on a timely basis, will most likely to lead the
organization to the success. Hence the main requirement of the management is to get correct
information on a timely basis. This forced the management to collate both financial and nonfinancial information from various source to get correct and timely information. Historically
it was a simple task. Company had only a handful of customers and very few products and
things were pretty straightforward and simple. The decision used to be taken based on the
350
Volume
Velocity
Variety
Veracity
351
Volume:
As the name of Big Data indicates, the size of the data is Big. In other words it refers to the
vast amount of data which is getting generated every second. It is not just Gigabytes or
Terabyte it is Zettabyte and Brontobytes. It is estimated that 2.5 Quintillion Bytes (i.e. 2.3
Trillion Gigabytes) of data are created every day. Further, on an average most companies are
storing 100 terabytes of data. It is also estimated that 40 Zettabytes (i.e. 43 Trillion
Gigabytes) of data will be created by 2020.
Velocity
High Velocity refers to the speed in which the data is getting generated and getting
transmitted. Posting in the social media which goes viral in second is a good example of the
High Velocity of the data. It is estimated that New York Stock exchange captures 1 TB of
trade information every day. Further, it is predicted that by 2016, there will be 18.9 Billion
network connection it almost 2.5 connections per person on earth.
Variety
High Variety refers to the different type of data getting generated. Historically the type of
data getting generated was restricted to the Alfa-numerical i.e. text and numbers. These data
could be easily mapped using tables and rational databases. In current scenario the data
which is getting generated are unstructured in nature. Few example are images, video, voice,
signals, GPS tracking etc. It is estimated that unstructured data constitutes over 80% of the
total data being generated. On an average 30 Billion pieces of contents are shared in
Facebook every month. 400 million tweets are sent per day by about 200 million active users.
Veracity
Veracity refers to the quality of the data which is getting captured. In other words it is the
uncertainty of the quality of the data getting captured. It is estimated that poor data quality
cost around $ 3.1 trillion a year in US alone.
The first step in Big data management is to identify the organizations objective and goal. The
organization has to list down the things what they need from the big data. In other words, in
big data management it should always be begin with the End objective. If the organization is
not determined its objective of using the big data then it will be lost in the processing the Big
data without any productive output.
The next step in the Big data management is to put the road map to achieve the objective and
goal set by the organization. In this stage the process and activity which need to be put in
place is discussed with all the stakeholders and agreed upon. It will act as a benchmark for
the Big data management.
In this stage the data which is required for achieving the desired objective is identified.
When the required data is identified it would be easy for the organization to mine the Big
data to the get the desired data. For example if the organization is analyzing the online spend
pattern of customer then the data requirement would be credit card transaction, debit card
transaction, merchant bank transactions etc.,. When this is identified then it will be easy of
the organization to segregate these type of transaction with other transaction in junk of Big
Data.
One of the basic characteristics of Big data is Veracity. Therefore, it is most likely that the
data extracted will be of poor quality. Hence the next step is to identify the missing data.
There are various scientific tools available to overcome this drawback of big tools. These
tools will extrapolate the missing data based on the available data, there by complete the loop
of missing data.
The next important step is to identify the technological solution available for processing the
Big data. It is a very vital step in the Big data management as it involves a huge cash outflow
in terms of purchase of necessary hard ware and software to support the Big data processing.
There are mainly option available in terms of software solutions from various service
providers. The organization has to wisely select the option considering the objective set and
the cost benefit analysis.
After the desired result is achieved from Big data, the next step is to continuously monitor the
activity of Big data processing and continuously revisit the assumption of the required data.
It is vital as new variety of data is getting pumped in on a regular basis and the data which
was important earlier may be redundant in the later point of time.
353
Risk Management
There are two basic parameters which governs the business decision namely Risk and return.
Every Business is exposed to some or the other risk, which affects it profitability and cash
flows. Risk is a probability or threat of damage, injury, liability, loss, or any other negative
occurrence that is caused by external or internal vulnerabilities, and that may be avoided
through preemptive action (Business Dictionary). In broad terms the uncertainty associated
with the outcome of an event that can lead to loss. Risk management is a technique by which
enterprises manages to establish a tradeoff between the two parameters for minimizing the
impact of risk and maximizing the stakeholders wealth.
ISO 31000 defines Risk management as follows:
Risk management is a process of identification, assessment, and prioritization of risks
followed by coordinated and economical application of resources to minimize, monitor, and
control the probability and/or impact of unfortunate events or to maximize the realization of
opportunities. Risk managements objective is to assure uncertainty does not deflect the
endeavor from the business goals
Process of risk management
1.
Identification of Risk
The Risk management process starts with the objective setting and identification of Risks
which will impair the organization from achieving the objectives. Objective of the
organization are the mission or vision which the management sets and cascades the same
throughout the organization. Organization aligns all its activities to these objectives.
Any activity which affects the organization from achieving its objectives are termed as
Risk.
354
2.
Assessment of Risk
After the risk is identified the next step is to identify the Probability and severity of risk.
Probability of risk is the likelihood and frequency of occurrence of risk. For example the
probability of earth quake with 7.5 magnitude in Richter scale is less whereas the
probability of road accidents are high.
Severity of the risk is the impact of the risk. In other words it is the extent of loss the
organization will face when the risk event has occurred. For example the impact of earth
quake with 7.5 magnitude in Richter scale is very high whereas the impact of theft in the
storeroom is low.
Based on the likelihood and impact of Risk, the Risk can be classified into 4 quadrants.
Namely
a. High probability and High Impact
b. High probability and low Impact
c. Low probability and High Impact
d. Low probability and low Impact
3.
Risk Response
After the Risk assessment is done the next step it to determine the appropriate risk
response. Risk response of the organization defers based on the Risk Appetite of the
organization. Risk Appetite is the level of risk that an organization is willing to accept.
However as a thumb rule following Risk response is adopted.
a. Risk avoiding: In this case the entire activity is avoided to avoid the risk from the
activity. This response is generally adopted when the probability of risk as well as the
impact of risk is high. For example: A manufacturing activity of an organization
involves handling of radioactive material which may have harmful impact on the
employees. Here the likelihood of risk is high and impact is also high. In this case the
organization may decide to stop this manufacturing activity.
b. Risk reduction: When the probability of risk is high and the impact of the risk is low,
then the organization would prefer to adopt the risk reduction process. In risk
355
reduction process the activity which will increase the probability of risk will be
identified and reduced.
c. Risk Transfer: This method of risk response is adopted when the likelihood of risk is
low and the impact of the risk is high. In case of risk transfer the risk of the
organization is transferred to other parties. The best examples of risk transfer is
Insurance and outsourcing. In case of insurance the risk of the organization is
transferred to the Insurer/Insurance Company for a consideration called premium. In
case any fatality occurs the organization suffer loss then the loss will be made good
by the Insurer/Insurance Company.
d. Risk Retention: When the probability of risk and impact of risk is low then the best
option is to retain the risk. In other words the said activity which has risk is
continued.
4.
356
3. Risk Response
Big Data technologies will allow the development of models that will support the
organization in finalizing the risk response. Big data technology has the ability to process
enormous amounts of data in fast timeframes and accommodate new requirements for
scenario stress tests at the trade, counterparty and portfolio levels. With this traits of the Big
data technology, Scenario simulations models can be built which serves in identification of
cause and effect relationship. This model in collaboration with the heat map can be used to
test the different risk response scenarios. Thereby giving an opportunity to the organization
to test the risk response in the test environment before implement the same.
4. Continuous monitoring
Big data technology has the potential of near real time data. It can be configured to generate
sophisticated reports which has the power of predicting the occurrence of risk on a real time
basis. This facilitates the organization in monitoring of risk not restricting to the internal risk
within the organization but also to the external risk which is universal in nature.
Conclusion:
There is tremendous scope and opportunity to leverage Big Data technologies to improve risk
management systems. This paper examined various aspects of risk management and how they
can be integrated with the Big Data technologies. Although Big data opens new avenues in
risk management, the organization has to perform a cost benefit analyses and decide the
implementing of integrating the Big Data technology in Risk management to have an
efficient and efficient organization.
Bibliography:
1.
2.
3.
4.
5.
Business
Dictionary
http://www.businessdictionary.com/definition/risk.html#
ixzz3pl6BfMHB
Crockford, Neil (1986). An Introduction to Risk Management (2 ed.). Cambridge,
UK: Woodhead-Faulkner. p. 18. ISBN 0-85941-332-2.
IBM,
Bringing
big
data
to
the
enterprise
http://www01.ibm.com/software/data/bigdata/ what-is-big-data.html
ISO/IEC Guide 73:2009 (2009). Risk management Vocabulary. International
Organization for Standardization.
Judith Hurwitz, Alan Nugent, Dr. Fern Halper, and Marcia Kaufman(2013) , Big data
for Dummies, ISBN 1118644174
357
ABSTRACT:
Innovation creates marketing opportunities and challenges. The advancements in the
technological world have allowed supermarket chains and other national stores to quickly
dominate the market and are driving out the concept of the` local stores. This surge in the
market has seen shares rise and profits bulge with the three main contenders in mind
Sainsburys, safe ways and Tescos who now serve the whole of the UK between them and
are the household names of the shopping world. The ICT input to these business is vital in
that it provides speedy service; controls stock levels and will even allow bank balance
transfers to be carried out with minimal difficulty or technical experience
In this regard author of this article admitted and highlighted further technological
advancement and its impact on E- shopping which will enable the supermarket chains and
other national stores for their efficiencent, aggressive market.
Key Words: ICT, Impact, E-shopping-Business
1. INTRODUCTION
Technology developments have created new marketing communication channels such as
email, SMS (Short Messaging Service) and MMS (Multimedia Messaging service).These
digital media are considered to potentially improve the possibilities to reach consumers. Even
POS Point of sale terminal (ordinary checkout) EPOS- Electronic point of sale terminal
(checkout connected to a computer data base using a laser scanner to read bar codes).
Information system is used widely in shops and in the distribution of goods and one area in
which their use is particularly important super markets. Computer systems are used in a
variety of ways in the modern, large supermarkets from stock control to maintaining
temperatures in fridge and freezers.
scales, a printer, a credit/debit card reader and a till drawer. It is base unit which is
connected by cables to the branch computer in the supermarket.
ICC- Integrated chip card which is very popular on the continent )or magnetic strip on
the card to request the information of the user to see whether or not the are eligible to
make an EFT.
Each product to be sold must have an identifying code number which is different from
that of every other product.
Different sizes of the same product even need different code numbers. These code
numbers are printed onto the labels or packaging of the product in the form of bar
codes.
359
Tesco supermarkets was first introduced the loyalty card in 1995 that saw a boost in
their sales and put pressure on its competitors to follow suit. These cards have similar
magnetic strips to those of the credit cards and so carry its competitors to follow suit.
These cards have similar magnetic strips to those of the credit cards and so carry the
same volume of information.
The code held on the strip is used to access the customers information from the
required database and then, in the same way as the items, the right information is
transmitted back to the checkout and the appropriate amendments made concerning
the amount of points or vouchers that the person has earned.
Internet Shopping
The most recent development in the supermarket world is the introduction of internet
shopping service. From the comfort of ones own home the customer can order which
goods they require without having to visit the store. The customer now can choose at
what time they would like the delivery and can pay with a large range of different
formats.
As the integration of this system grows stronger the customer is provided with a
better service and comes to expect more therefore putting pressure on the market to
evolve all the time. Tesco, again the pioneer was the first in 2000 to provide an online
shopping service and for a time was the biggest online retailer in Europe seeing its
orders raise from 15000 to 60000 a week worth approximately each week. Paying for
these goods involves handling over personal data and the supermarket is obliged
under the data protection act of 1998. It keep the data safe
and not use or distribute it in any unlawful way .Here is the section of the data
protection act that is relevant to the data of an individual. Businesses have recognized
that the internet allowed people to interact with each other in a different way, and it
gave the potential for creating new markets .
Business began to use the internet in different ways:
The customer enters his order, together with credit card details, via an on screen
form
Advantages of internet shopping to business
Overheads can be cut. A web based business does not necessarily need a high street
shop and staff to run it . Small specialized concerns have therefore been able to
establish themselves on the web with very little capital outlay.
Many new businesses have been created via the internet; some have been successful
some not. The overall effect, however, has been to invigorate the business
environment by introducing healthy competition
The order is received and sent to a database.
The information in the data is communicated to a distribution centre where orders are
made up
The order is delivered to the customer.
361
Using this information, the main computer system updates its record of the
number in stock of every item in the store. The SEC allows managers to get a
real time stock picture and allows a manager to escalate stock deliveries from
72hours to 48 hours.
The system automatically orders the correct amount of stock required by the
store for the next available delivery 48 or 72 hours ahead
The main computer also transmits these orders to computers in the distribution
centers (large warehouses storing products ready for delivery to stores)
These distribution centers then deliver the required stock to the stores
immediately.
Price changes and prices of new products, special offers are sent back to
branch computer in the supermarket.
New shelf labels are printed and the night staff of the supermarket places these
on the shelves ready for the following day attached to products, neither does
the packaging of the product show the price.
The only reference to the price of a product is contained on a label attached to
the shelf where that product is situated
Conclusion
In this paper, a super market is producing many changes in our society. These
changes have produced many benefits, the system is convenient for people to
shopping, greatly improve the efficiency, also effectively save the customers
time to find items in a supermarket
The system can make supermarkets more intelligent, user friendly,
convenient for business sale and be able to meet many shoppers personalized
service electronic label and internet of things application related standards and
best service provided to public.
REFERANCE
AUTHOR: BY DIAVID PREPLETANY
WEBSITE: www.researchnomatic.com
www.teach_ict.com
362
ANILKUMAR. R,
ASSISTANT PROFESSOR,
ACHARYA BANGALORE B SCHOOL
ANITHA.C,
FIRST YEAR, MBA,
G.T. COLLEGE OF COMMERCE AND MANAGEMENT
ABSTRACT
Technology is very much influencing the growth of the start-ups, as it is evident that from
past last 10 years high growth companies is recognized as technology start-ups. Merging
technology with the service industries for example distribution, payments management, travel
services, selling new and old products and many more has made the business associated with
that a lucrative ones. Let us take example of all the billion dollar valued start-ups on India, it
is more evident that with lesser time these ventures have become so successful. In India most
of the start-ups which got funded are found to be technology related as it considered to be
high growth ideas or ventures. The entrepreneurs who venture out with these technology
ideas are motivated by the ecosystem which is prevailing in India.
This study is conducted to identify how technology is influencing modern start-ups growth.
363
364
Introduction:
12 MANY HOUSEHOLDS IN INDIA ARE STILL WITHOUT ELECTRIC POWER AND DENIZENS LIVE IN
VIRTUAL DARKNESS DUE TO THE WANT OF ELECTRICITY. ENERGY AND IN EXTENSION
ELECTRICITY IS ONE OF THE BASIC REQUIREMENT FOR ECONOMIC DEVELOPMENT. WHILE
THERE IS A SERIOUS SHORTFALL IN POWER REQUIREMENT, THERE IS ALSO A GROWING
CONCERN WITH GREENHOUSE GAS EMISSIONS AND INDIAS RISING CARBON FOOTPRINT IN A
WORLD THAT IS INCREASINGLY ALARMED AT FORCED CLIMATE CHANGE DUE TO THE RISE OF
POLLUTANTS IN THE ATMOSPHERE.
70%
LARGE EXTENT.
Year-wise
Growth
of
Electricity
(1992-93 to 2014-2015-upto May 2014)
(In Million Units)
Year
1992-93
1995-96
1996-97
1997-98
1998-99
1999-00
2000-01
2001-02
2002-03
2011-12
2012-13
2013-14
Nuclear
6727
7982
9024
10042
11987
13252
16896
19278
15915
32286
32866
34227
Note:
Generation
Hydro
69869
72579
68618
74476
82619
80533
74346
73992
55850
135794
118514
140445
(Utilities)
Thermal
224766
299316
317158
336104
353800
386226
408208
422001
372230
708805
760675
792477
in
Total
301362
379877
394800
420622
448406
480011
499450
515271
443995
876886
912056
967150
*:
Upto
May
2014.
*:
Provisional
based
on
actual-cum-assessment.
: CEA Monitors Generation from Conventional Sources (Thermal,
Hydro
and
Nuclear)
only.
365
India
in India
2013-14
(A.P)
43007.76
1985.93
1113.94
22235.11
29344.01
23552.10
0.00
2769.74
1190.76
27887.33
6795.83
24516.35
58080.37
926.28
8787.06
26455.28
32511.04
Tamil Nadu
Uttar
Pradesh
Uttarakhand
West
Bengal
SPUs Total
Eds
Arunachal
Pradesh
Goa
Manipur
Mizoram
Nagaland
Puducherry
Sikkim
Tripura
EDs Total
4597.75
4112.52
4887.33
5247.81
4726.75
4699.18
735.69
905.40
1076.19
1177.38
1140.73
1324.79
1316.00
83.00
178.07
226.25
174.63
174.63
268.20
0.00
0.00
0.00
0.00
0.00
0.00
0.00
1.70
0.65
2.01
2.01
1.60
5.49
5.69
18.52
10.65
17.33
33.48
22.33
45.76
53.44
73.95
75.51
73.36
70.04
82.56
82.47
86.78
257.24
242.27
207.13
182.89
235.73
239.70
235.00
46.21
48.00
38.54
41.53
21.07
3.05
5.97
611.10
648.99
648.70
764.56
808.53
802.03
905.98
1065.39 1109.06 1165.14 1320.75 1346.45 1353.14 1561.07
289852.6 294769.1 297016.4 295308.1 318012.8 312813.5 378521.6
India
0
6
6
2
3
9
5
Abbr.: R.E: Revised Estimate. A.P: Annual Plan.
P : Provisional.
EDs: Electricity Departments.
SPUs: State Power Utilities.
Source: Power & Energy Division, Planning Commission, Govt. of India.
(ON494)
Current Power Supply Position of Karnataka:
Karnataka state was a pioneer in the generation of hydroelectric power and has grown largely
dependent on this source, while in recent years the state has turned to nuclear energy too. From the
completion of the Sharavathy Valley Hydroelectric project in the year 1980s, there has been a very
good rate of addition of more than 4,800 MMW of generating capacity in the state and also there has
been an increase of more than 1200 MW of Karnatakas share in the Central Sector Power
Generation. Recently a High Voltage Direct current line of transmission from Orissa to Kolar was
also commissioned to import surplus of electricity from the East to South region. But the load
growth, with the onset of industrialization, pumped irrigation method and all electric homes has been
huge additional power supply in the state since1973.
During the months of monsoon the demand and supply situation is generally manageable every year,
but results in chaotic scenes during summer months. During the period of 2006 the deficit was
estimated as about 7.6 % in peak demand and 1.9 % in energy requirement. Today the state at times
is energy deficient by about 25% of the required demand.
367
The state which is largely dependent upon hydel power faces major power issues every time there is
a drought or monsoons have failed. The only way forward to bridge this gap is to pursue a
meaningful policy of harnessing and using solar power.
Karnatakas Solar Situation:
The Government of Karnataka is also planning to set up the biggest solar park. Karnataka
established Asias first hydroelectric station and going to achieve another milestone in setting
up massive solar parks. These areas has been chosen because of various combinations of
factors like high sunlight exposure, the backwardness of the area, lesser demand for the land.
Karnataka will tap a green energy of around 16000 MW in the next five to seven years.To
facilitate such massive quantum of renewable energy from the generation sites, the Centre has
already decided to set up a pan-India green corridor at a cost of Rs. 36,000 Crores.
Sl
No
Name of Park
Proposed
Capacity
(MW)
Karnataka
Solar Park
2
Implementing
Agency
Location
identified by State Govt
Moregere,
Hagaribommanahalli
400
village,
Dist:
Bellary
Joint Venture between SECI,
and KREDL
Nagalamadika,
Pavagada
Taluk, 400
Dist:Tumkur
NOTE: This data is as per initial survey. This may change subsequently
An International Context:
The solar installations across the world are increasing as it is seen as a clean and renewable
source of energy. The worldwide capacity of solar power by technology is about 142 GW in
2013 and 178 GW in 2014. This is also gaining momentum as the world runs out of fossil
fuels.
368
Identified L
Area
4000
a
(approx.)
2000
a
(approx.)
2000
a
(approx.)
Many industrialised nations have installed significant solar power capacity into their grids to
supplement or provide an alternative to conventional energy sources while an increasing
number of less developed nations have turned to solar power to reduce dependence on
expensive fossil fuels that have fluctuating prices and are also susceptible to price shocks due
to international political events. Worldwide growth of photovoltaics is extremely dynamic
and varies strongly by country. By the end of 2014, cumulative photovoltaic capacity
increased by more than 40GW and reached at least 178GW, is sufficient to supply 1 percent
of the worlds total electricity consumption of currently 18,400 TWh (Tetra watt hour). As in
the year before, the top installers of 2014 were China, followed by Japan and United States,
while the United Kingdom emerged as the leader in the Euro Zone.
Germany remains for one more year the Worlds largest producer of solar power with an
overall installed capacity of 38.2GW.
Country Wise Solar Lighting Capacity in the World
China and Taiwan
16.37%
Japan
13.16%
Germany
21.58%
Italy
10.43%
United kingdom
2.88%
Rest of Europe
14.52%
United states
10.33%
Canada
0.97%
Australia
2.34%
South Africa
0.52%
Rest of the World
6.90%
369
By 2012 a total of 4,600,000 solar lanterns and 861,654 home lights have been installed. The
new and renewable energy policy offers 30% to 40% subsidy on solar lanterns. About 20
million solar lanterns are expected by the year 2022.
Solar Photovoltaic Home Lighting Status in Karnataka :
In Karnataka solar energy is used as grid interactive system and as off grid solar system. And
it also has 6 MWp grid interactive systems and 29.41 kWp capacity stand- alone solar power
plants. The off grid solar power system has been given in the below table.
370
2,694 in
551 in
36,134 in
7,334 in
253 in
255.41kWp
nos.
nos.
nos.
nos.
nos.
(2007-2012)
1201.14
1362.60
1375.22
919.21
9057.86
40.43
232.52
1963.72
2005.96
3963.73
8748.12
906.49
91.80
1824.80
3352.52
2331.46
1320.92
745.75
193.72
78.22
2151.38
4310.70
604.47
293.88
5545.81
371
(2012-2017)
163.78
1010.40
527.20
370.00
6397.36
0.00
6.57
225.69
2289.70
7057.71
270.49
953.80
854.68
448.97
27.57
1852.27
501.83
573.08
1461.40
0.00
299.90
5138.63
1081.38
2156.74
401.90
Uttar Pradesh
Uttarakhand
West Bengal
Delhi
Lakshadweep
Puducherry
Others
(BHEL,
REIL,
NABARD, Regional Rural
Banks, CEL, BEL and
NGOs,
Other
Channel
Partners etc.)
India
3912.78
6968.15
3148.48
644.93
3584.20
829.25
2692.36
4179.64
382.02
0.00
644.96
0.00
20393.16
30584.72
94103.37
72554.75
Haryana
Himachal Pradesh
Jammu & Kashmir
Karnataka
Kerala
Madhya Pradesh
Manipur
Meghalaya
Mizoram
Rajasthan
Sikkim
Tripura
Uttar Pradesh
West Bengal
Andaman & Nicobar Islands
Lakshadweep
India
6
3
18
2
134
3
8
25
33
1210
4
30
403
437
21
3
2434
Note:
Uttar
Pradesh
figure
includes
Source :Lok Sabha, Un-starred Question No. 692, dated on 26.7.2001.
Uttaranchal.
Year: Period of fiscal year in India is April to March, e.g. year shown as 1990-91
relates to April 1990 to March 1991.
Units: (a) 1 Lakh (or Lac) = 100000
(b) 1 Crore (or Cr.) = 10000000
Some part of the footnotes/units may not be applicable for this table.
How Karnataka Policy is Different from Other State Solar Policies:
Under the Karnataka Renewable Energy Policy, it is envisaged that the State will have a
target of achieving 126 MW of solar power up to 2013-14. The Government of Karnataka
had released the Solar Policy for FY11-FY16 on 1st July 2011 envisaging to set up a capacity
of 200 MW of solar power in the state for the RPO fulfilment of the ESCOMs. The policy
came into force from 1st July 2011 and shall remain in force up to 31st March 2016. The
state will continue to implement JNNSM and all other schemes of the MNRE. The State
government provides land if available. Solar grid connected projects above 1 MW is given
additional incentives up-to Rs.5 lakhs12/kWh for solar PV &Rs. 10/kWh for solar thermal
in addition to tariff by KERC
S#
1
2
3
State
Andhra Pradesh
Arunachal Pradesh
Chhattisgarh
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
Total
Delhi
Goa
Gujarat
Haryana
Jharkhand
Karnataka
Kerala
Madhya Pradesh
Maharashtra
Odisha
Panjab
Rajasthan
Tamil Nadu
Uttarakhand
Uttar Pradesh
West Bengal
2.525
1.685
824.09
7.8
16
14
0.025
4.75
34.5
13
9.325
442.25
17.055
5.05
12.375
2
1440.605
(Reference no.4) The above table indicates the installations of solar plants in the different
states of the India.
374
This statistic represents major countries at the end of year 2014, by cumulative solar PV capacity.
China's cumulative solar PV (photovoltaics) capacity reached just under 30 gigawatts at the end of
2014.As can be seen Indias share of installed capacity is extremely poor as compared to the
developed countries and China. Solar installed power in terms of Giga Watt capacity on a world
scale, though encouraging is not so in the case of India.
Electric power consumption measures the production of power plants and combined heat and
power plants less transmission, distribution, and transformation losses and own use by heat
and power plants.
The world view can be quite startling in per-capita consumption of power (KWH). Even in
comparison to other BRICS nations India ranks the lowest in per capita consumption of
electricity and this does not a good indicator for a country that is in a rapid development
mode.
375
The per capita consumption of Electricity in India makes for an interesting reading.
The State of Goa (2004.77 kWh) & Puducherry (1864.5 kWh) account for maximum per
capita consumption of electricity. While states of Bihar (117.48 kWh), Manipur (207.15
kWh) & Assam (209.20 kWh) show the lowest per capita consumption. The National Average
per capita electricity consumption is 778.63 which is far below the international average and
those of developed countries. This lack of infrastructure has serious consequences for
industry and development, which in turn effect generation of jobs and provision of basic
energy needs.
376
While India is a developing nation and aims to achieve parity with developing nations in terms of
infrastructure development and raise the income of its population it needs to be wary of its rising
carbon footprint. Climate change is a major concern the world over and while India feels
victimized by the developed nations it needs to curb its CF while raising the per capita power
consumption.
This is a tricky issue and the only feasible way in which India can raise per capita consumption of
electricity is by raising levels of power generated, make that power accessible to even the remotest
areas and keep its CF static by using clean energy and not that generated by burning fossil fuels. In
this context solar energy seems to be the best bet along with other clean fuels like hydel power and
wind energy.
377
they have managed to distribute hundreds of thousands of solar home systems to the
rural poor. There is ample opportunity to learn from the experiences of pioneer
companies.
5. Off Grid Use: The government must encourage the use of off grid devices like standalone solar lanterns or torches that can reduce the load on the power grid. However
this too needs to be supported in terms of financial assistance and technical help.
A possible business model
Subsidiary Services
The lack of a comprehensive business plan in detailing the plan of action from creating
demand, to manufacturing and the installation of solar units, to use by the end user is a major
cause for concern and can potentially derail the best laid plans. Another important fact is that
there are not enough of trained technicians to deals with defective solar units. The
government needs to develop a comprehensive plan that will address all these issues in the
short term.
Unless plans are comprehensive and carefully delineated the whole grand scheme of raising
solar power use would remain a non-starter. Particular concern is the lack of infrastructure in
servicing solar plants.
379
Conclusion
The way forward is clear. The world cannot consume fossil fuels at the frenetic rate that they
do so today, but need to change course and adopt sources of renewable clean energy that. In
this context the words are Indian Prime Minister Narendra Modi, at the Paris climate talks are
poignant. Democratic India must grow rapidly to meet the aspirations of 1.25bn people;
300m at homes are without access to energy. We are determined to do so guided by our
ancient belief that people and planet are inseparable, that human wellbeing and nature are
indivisible. The state of Karnataka needs to step up to the challenge of aggressively pursuing
a clean energy initiative by promoting the setting up of infrastructure for solar power
installations in the state.
Over the last 200 years an ever-increasing proportion of our energy has come from nonrenewable sources such as oil and coal. While demand for energy raises these resources are
running out and scientists are exploring the potential of renewable sources of energy for the
future. Solar energy seems to hold out hope because it is abundantly available in India, is
seemingly inexhaustible and is absolutely clean.
Karnataka states share of renewable energy potential is at 13% of the national gross, second
only to Gujarat at 25%. This being the case the state needs to transfer this p[otential to
actionable items where the state is supported by energy from renewable sources.Estimates
from international organisations suggest that if the world's demand for energy from fossil
fuels continues at the present rate that oil and gas reserves may run out in the not so distant
future. The action plan for the future needs to be very clear. The state government needs to
reduce its carbon dioxide emissions. It also needs to increase the amount of energy which
comes from renewable sources.By 2020 the state government must set a benchmark that 20%
of energy must come from renewable sources. The state must have a target of 15% of its
energy consumption being sourced from renewable energy. The state must also aim to
reduce greenhouse gas emissions by 80-95% below 1990 levels by 2050.
There are two ways the energy use can change in Karnataka:
Even as the Government of India looks to raise the capacity of solar energy in the country
from the present 3 Giga Watts to 100 Giga Watts in 2022 the challenges are many. It needs to
be understood that there is no clear business plan in place which can drive the manufacture,
sale, installation and maintenance of solar plants. While setting up plants is one aspect the
energy so produced needs to fire efficient devices for the end user which could be a light
bulb, a solar heater or even a television? Maintenance of solar units is also an issue and the
380
government needs to establish and arrange for the training of solar technicians. The greater
the use of a solar plant and the more efficient the device using the energy would mitigate the
rather large capital expenditure incurred in setting up solar plants.The scenario is exceedingly
exciting as solar power can drive sewing machines, power looms and even refrigerators that
can assist in the business of a petty trader creating the wherewithal for a livelihood in what is
an aspirational India even while keeping an eye on harmful gas emission and the rising
carbon footprint of nations.
Reference
1) G.D. Kamalapur, R.Y. Udaykumar, Rural electrification in India and feasibility of
Photovoltaic Solar Home Systems,Elsevier, Electrical Power and Energy Systems 33
(2011) 594599.
2) Santosh M.Harish , Kaveri K.Iychettira , ShubaV.Raghavan , Milind Kandlikar,
Adoption of solar home lighting systems in India: What might we learn from
Karnataka?, Elsevier, Energy Policy,2013.
3) Christoph Schultz a & Ganesh Doluweera, Best Practices for Developing a Solar
Home Lighting System Market, Routledge, 01 Dec 2011.
4) Hippu Salk Kristle Nathan, Solar Energy for Rural Electricity in India, Economic &
Political Weekly, December 13, 2014.
5) Adkins, E., Eapen, S., Kaluwile, F., Nair, G., &Modi, V. (2010), Off-grid energy
services for the poor: Introducing LED lighting in the Millennium Village Project in
Malawi, Energy Policy, 38(2), 10871097.Ahmed, K. (2004).
6) Bhusal, P.,Zahnd AEloholma, M., &Halonen, L. (2007), Energy-efficient innovative
lighting and energy supply solutions in developing countries, Electrical Engineering
(IREE),2(5), 665670
7) Cabraal, R. A., Barnes, D. F., &Agarwal, S. G. (2005), Productive uses of energy
from ruralDevelopment, Annual Review of Environment and Resources, 30(1), 117
144. CGAP (2004).
8) Accord Fintech (2013), Use of Solar Energy, Vol 25, pp 18-19, Global Journal
of Business Research.com
9) Anonymous (2011), Solar Energy Use Important to Asia's Economic Growth, Vol
20,
pp 3-5, Business Research.com
10) Gupta C L; Jauhar, Sujay (2014), Application Engineering Data for Solar Energy
Utilisation, Journal of the Solar Energy Society of India.com, Vol 15, pp 13-20
11) Hadi, Mohamed A; Abdel-Razek, Refaat H; Chakroun, Walid M (2013) , Economic
Assessment of the Use of Solar Energy, Vol 7, pp 73-82 , Global Journal of
Business Research.com
381
12) Li Pinging; Hu Yongguang; Liu Jizhan 2014, Solar Energy Utilisation Efficiency in
Environment, International Journal of Global Energy Issues.com, Vol 21, pp
131-143
13) Morley, David, AICP (2014) , Solar Energy Use: Local Planning Issue, Vol 80,
pp 56-57, Business Research.com
14) Mushir Ahmed (2011), Solar Energy Use sees Major Growth, Vol 20, pp 13-15,
BusinessResearch.com
15) Zakhidov, R A; Saidov, M S, The Early XXI Century and Prospects for
Development of Solar Energy, Business Research.com, Vol 45, pp 1-6
Web Reference:
http://mangaal.com/basic-components-of-a-solar-home-lighting-system
https://en.m.wikipedia.org/wiki/Solar_power_by_country global solar by country
http://www.solarlighting system
http://www.solarpolicy.com
http://www.sandeeonline.org/about.php
http://www.mgired.kar.nic.in
http://photovoltaics.sustainablesources.com/
https://en.wikipedia.org/wiki/Photovoltaic_system
http://neda.up.nic.in/RTI/MANUAL/MANUAL-1/MANUAL-1(6).pdf
https://energypedia.info/wiki/Business_Models_for_Solar-Based_Rural_Electrification#Objective_4
http://www.shareyouressays.com/114026/short-essay-on-solar-cooker
http://www.sciencedirect.com/science/article/pii/S0960148112001589
382
Swarnika Dixit
Research Scholar,
VTU, Bangalore
Research Scholar
Abstract
Training has become immensely important for smooth functioning of modern
organizations.Training results in learning and involves knowledge acquisition, improvement
of skills, talents and abilities.Training also helps organizations gain competitive edge by
aiding in the retention of employees.There are multiple ways of conducting training and
disseminating knowledge.The most commonly used methodologies are lecture method, talks,
discussions, in-basket, business games, role playing, case study, sensitivity training,
conferences and seminars, programmed instructions, computer-based training, exercises,
projects, simulations and games, remote telecommunication live teaching, distance learning
etc.Besides these methods of training it has now become
Introduction
Organizations often compete on competencies: the core sets of knowledge and expertise that
give them an edge over their competitors (Kwon, 2009; Lawler & Worley, 2006). Training
plays a critical role in improving and strengthening these competencies and in this way help
the organizations to effectively achieve their goals.
383
Methods of Training
There are multiple ways of conducting training and disseminating knowledge. The most
commonly used methodologies are lecture method, talks, discussions, in-basket, business
games, role playing, case study, sensitivity training, conferences and seminars, programmed
instructions, computer-based training, exercises, projects, simulations and games, remote
telecommunication live teaching, distance learning etc. These methods are grouped into two
categories i.e. Informational and experiential.
384
Experiential Methods: In experiential method learners get the opportunity to interact with
the faculty which is different from academic learning. Experiential learning is the process of
learning from direct experience. This is highly suited to the acquisition of practical skills,
where trial and error and the opportunity to practice practical techniques related to real tasks
is essential. In many countries, experiential learning is integral to vocational education. This
method of learning is focused on the communicative relationship and exchange of
information between the faculty and learner. On-the-job training, games and simulation,
equipment simulators, case study and analysis, role playing, behavioural modeling, T -group
training are some of the examples of experiential methods.
Besides these methods of training it has now become imperative for organizationsto adoptand
implement technology-based learning (TBL) as an answer to sweeping global changes, cost
reductions and work-life balance.
Globalization, economic conditions, advancement in technology and work-life balancehave
combined together to create a business scenario thatrequires innovative, flexible and
convenient training solutions in organizations.
Globalization
For organizations operating globally centralized, classroom training is not an efficient and
effective way to conducttraining to a global workforce also it can become an extremely
expensive affair. TBL enables organizations to deliver training to employees anytime and
anywhere across the globe. It also facilitatesorganizations with global workforce to do away
many of the costs associated with classroom training and deliver just-in-time learning to their
employees.
Cost-Reduction
In todays dynamic scenario all organizations are expected to be learning organizations so
that they can gain a competitive edge but simultaneously they face tremendous pressure to
385
reduce costs and increase shareholder value. The human resource personnel are expected to
do more with less.In training field this renders into increasing an organizations development
activities while at the same time reducing training expenditures. Technology-based learning
can help organizations respond to this problem. Although technology-based learning leads to
increased upfront costs (e.g., development, software/hardware) but it also helps firms reduce
variable costs
associated with classroom learning.Thus technology can facilitate organizations to reduce
variable costs on training and increase their returns on investment.
Work-life Concerns
Research by the Society for Human Resource Management (SHRM) concluded thatone of the
employment trends anticipated to have the greatest impact on theworkplace is the increased
demand for flexible work schedules from employees(Schramm and Burke, 2004). The
reasons for this being more women are working and breakdown of joint families. Flexible
work schedules help employees manage their professional and personal lives conveniently
and also reduces employee turnover in organizations. Technology-based learning facilitates
employees to complete training offsite and at their own convenience.
Advancement in Technology
Recent advances in technology havemade technology-based learning a perfect alternative to
the traditional classroom training.This capability, combined with the fact that the mediawhich
support these advanced technologies has become more cost-efficient, reliable, andaccessible
and therefore has led organizations to utilize technology-based learning torespond to their
employee development needs.
instruction in a way that is more engaging for learners than traditional classroom instruction.
It is also economical for employers to administer TBL because often it can be delivered
directly via employees PCs. It allows firms to bring training to employees rather than viceversa, which is generally more efficient and cost-effective. It also allows employees to search
through a virual sea of information in order to customize their own learning in their own time
and space.
TBL has numerous advantages in comparison to face-to-face learning:
Learning is self-paced.
Training is interactive.
The growing importance of TBL in organizations along with its numerous advantages has
motivated me to take this topic for study.
Keeping these objectives in view the research is undertaken in CYIENT Ltd., Cyient
(formerly Infotech Enterprises) is an Indian company focused on engineering, networks and
operations. The company features among the top 30 outsourcing companies in the world. On
7 May 2014,Cyient Limited, formerly known as Infotech Enterprises Limited officially
announced its new name based on approval from a shareholders vote.
In this study the sample size consists of 30 respondents.Questionnaire is used as tool of data
collection. Both closed-ended and open-ended questions areadministeredto employees of
CYIENT Ltd.Sampling unit for the study was Executives, Team Leaders andProject
Leadersof CYIENT Limited.
387
The study is conducted with the assumption that the information given by the
respondents are all correct.
Interactions with employees were limited because of their busy work schedule.
26
Partially
Implemented TBL
74
Implemented TBL
Interpretation: In Cyient Ltd.74% of employees expressed that TBL has been implemented in
their organization whereas 26% said it has been implemented partially in their organization.
2. Tools of TBL used in the organization
25
LMS
35
Web Conferences
15
Tutorials
Others
388
45
15
Yes in concert
No not in concert
40
sparingly used
Interpretation: Maximum number of employees responded that TBL is not being used in
concert with traditional face to face instructions.
4. Has TBL helped in enhancing employee performance?
0
Yes
No
100
Leadership
13
Critical Thinking
43
15
Project Management
and Export Control
Issues
29
Others
21
44
TBL relevant at all levels
At entry level
35
At operational level
44% of the employees responded that TBL is relevant at all levels 35% said that it is relevant
at entry level and 21% at operational level.
7. Measurement of effectiveness of TBL in the organization
29
32
Certificate Issued after
training
13
26
15
Employees are
Satisfied
Not Satisfied
85
390
Interpretation: Majority of employees said that they are satisfied with TBL in their
organization and 15%said that they are not satisfied.
9. Suggestions from employees
13
TBL can be conducted
by external faculty
No Suggestions
87
Interpretation: Majority of employees (87%) gave no suggestions and 13% said that TBL can
be conducted through external faculty.
Findings
74% of the employees have responded that TBL has been implemented inCyient
Technologies Limited.
LMS is the most commonly used method of TBL as revealed by the responses of 35%
of the respondents.
45% employees expressed that TBL is sparingly used with traditional face to face
instructions and 40% employees responded by expressing that there is no blended
learning.
Filling feedback form and number of training modules completed is used to measure
effectiveness of TBL on employees.
87% of the employees preferred not to give any suggestions pertaining to TBL in their
organization.
391
Suggestions
Regular feedback should be taken from employees pertaining to the ways and
means of improving it.
Conclusion
Many firms including Cyient Ltd have drifted from classroom training to Technologybased
over a period of time. Although this shift in training has resulted in cost-savings and
numerous other benefits for the organization it has also offered the potential to
revolutionize training effectiveness by making training better targeted and more learner
centered and personalized. TBL has resulted in improving employee performance in
organizations. Companies that have realized this potential are now betterpositioned to
leverage their human capital for sustained competitive advantage and growth.
References
1. Kozlowski, S.W.J., Toney, R.J., Mullins, M.E., Weissbein, D.A., Brown, K.G. and
Bell, B.S.
(2001) Developing adaptability: A theory for the design of integrated-embedded training
systems. In E. Salas (ed.), Advances in Human Performance and Cognitive Engineering
Research, Vol. 1 (pp. 59-123). New York: JAI Press.
2. Salas, E., Kosarzycki, M.P., Burke, S., Fiore, S.M. and Stone, D.L. (2002) Emerging
themes
International Journal of
Management Reviews, 4: 135-153.
3. Eighteen, R. (1999). Training needs analysis for IT training. Industrial and Commercial
Training 31(4): 149-153.
392
393
E.Mohana Roopa
HOD-CS Dept.
Acharya Bangalore B School
Devashish Goswami
Asst. Prof (CS Dept)
Acharya Bangalore B School
Abstract:
Internet marketing is the fastest growing and most exciting branch of marketing today.
As the world becomes ever more connected, keeping up with developments and trends
is vital for marketers trying to reach new audiences who are more discerning,
fragmented and cynical than ever. Technology and software are changing at such a high
rate that it seems almost impossible to keep up with trends. Products and services are
evolving and adapting to the online sphere. The web is constantly shifting, growing and
changing everything is fleeting. Every aspect of internet marketing is digital. Naturally,
it is impossible to predict what the future of internet marketing will hold, web users are
becoming more aware and marketing savvy, and their attention spans are shortening as
desirable content becomes ever more quickly available. This market is more likely to
challenge debate and denigrate a brand but it is also more likely to share good content
and products with an exponentially growing social circle.
Keywords: E-Marketing, Global Trends, 7Cs, Challenges
INTRODUCTION
E-Marketing is the product of the meeting between modern communication
technologies and the age-old marketing principles that humans have always applied.
That said, the specifics are reasonably complex and are best handled piece by piece.
394
Internet marketing is the fastest growing and most exciting branch of marketing today.
As the world becomes ever more connected, keeping up with developments and trends
is vital for marketers trying to reach new audiences who are more discerning,
fragmented and cynical than ever. Technology and software are changing at such a high
rate that it seems almost impossible to keep up with trends. Products and services are
evolving and adapting to the online sphere. The web is constantly shifting, growing and
changing everything is fleeting
INTERNET MARKETING
Internet marketing often called online marketing or emarketing is essentially any
marketing activity that is conducted online through the use of internet technologies. It
comprises not only advertising that is shown on websites, but also other kinds of online
activities like email and social networking. Every aspect of internet marketing is digital.
Internet marketing has three cornerstone principles:
Immediacy- The web changes at a blistering pace and online audiences, whose
attention spans are short, expect on-the-minute updates and information. To
keep the favour and attention of this group, we must respond to online messages
and interact with communities as quickly as possible.
Personalisation- customers online are no longer faceless members of a broad
target audience they are individuals who want to be addressed personally.
Have to use the wealth of personal information available online to our benefit by
targeting the relevant people precisely and personally.
Relevance- communication online must be interesting and relevant to the
reader, otherwise it will simply be ignored. With all the information that is
competing for our audiences attention, we must find a way to stand out and
engage readers. The best way to do this is by giving them exactly what they want,
when they want it.
GLOBAL TRENDS
The internet marketing field hasnt stood still. Here are some of the current trends:
Social media marketing- Whether it is a fad or here to stay, social media has
made an indelible mark on the web landscape and, concurrently, on marketing
tactics. Social media marketing involves using peer recommendations, sharing,
395
the ability for impulse shopping. Impulse shoppers have found a true friend in the
Internet. Within seconds from being made aware of a product, consumers can purchase
it online. Further, with the targeting techniques available to advertisers, consumers who
turn down a product because of the price can be identified and served a special offer
more likely to result in a purchase. In the right hands, with the right tools, the Internet
really is an advertisers dream come true.
As opposed to the 4 Ps of brick-and-mortar marketing, the changing outlook in the area
of e-marketing can be explained on the basis of 7 Cs of e-marketing.
Contract: The e-marketers first goal is to communicate a core promise for a
truly distinctive value proposition appealing to the target customers
Content: refers to whatever appears on the website itself and on hot linked
websites. If chosen appropriately, it can increase both the rates at which
browsers are converted into buyers and their transactions.
Construction: The promises made by e-marketers are not unique to the Internet,
but the mediums interactive capabilities make it easier for them to deliver on
their promises quickly, reliably, and rewardingly. In practice, this means that
promises must be translated into specific interactive functions and Web design
features collectively giving consumers a seamless experience. Such design
features as one-click ordering and automated shopping help deliver the promise
of convenience.
Community: Through site-to-user and user-to-user forms of interactivity (such
as chat rooms), e-marketers can develop a core of dedicated customers who
become avid marketers of the site too.
Concentration: Targeting through online behavioural profiling. Advertisers have
known for some time that behavioural targeting (profiling) is vastly superior to
simple demographic targeting. Knowledge of a consumers past purchases
interests, likes/dislikes, and behaviour in general allows an advertiser to target
an advertisement much more effectively.
Convergence: We will soon enter the next round of the E-marketing battle as
broadband reaches the masses. The Internet will become more ubiquitous and
wireless, televisions will become more interactive, video/data/voice appliances
will converge, brand advertising and direct marketing practices will integrate,
397
domestic brands, commerce and marketing will become even more global, and
big marketing spenders will spend more money online. Many companies that are
well positioned today will need to continue to evolve to take advantage of the
opportunities.
Commerce: The last emerging fundamental of e-marketing is commerce, whether it
includes offering goods and services directly, or marketing those of another company
for a fee, thus helping to cover the fixed costs of site operations and to offset customer
acquisition costs.
CHALLENGES IN E-MARKETING
Every online fulfilment operation, large or small, faces some challenges. Some of the
challenges e-marketers faced are
Controlling customer data: As outsourcing arrangements proliferate and delivery
services become more expert in using information technology, e-marketers risk losing
their lock on consumer data. In an economy where knowledge is revenue as well as
power, e-marketers must consider how to strike a balance between the efficiencies
offered by the out-sourcing of fulfilment and the confidentiality that keeping data inhouse preserves.
Integrating on and off-line orders: When the volume of orders is high, companies must
decide how much integration they need. In a totally integrated system, Internet orders
would be automatically transmitted through a processing centre and transferred to the
suppliers manifest. An integrated system with full ERP (enterprise resource-planning)
capabilities can ensure that surges in demand dont retard key fulfilment operations
such as data entry, inventory, and packing.
Delivering the goods cost-effectively: At present, every single transaction challenges emarketers to deliver the goods quickly, cheaply, and conveniently. But this is largely a
technical and logistical problem, and it will be possible to solve it by developing new
sorting and scanning equipment and by deploying larger delivery vehicles.
Handling returns- marketers, with their emphasis on convenience and customization,
must match the high standard of service exhibited by some physical marketers
regarding returns. Customers often have to find new packing materials; call to arrange
credits and refunds, and physically takes packages to delivery services. Each step
represents an inconvenience that, can create negative feelings about the vendor
398
CONCLUSION
Naturally, it is impossible to predict what the future of internet marketing will hold, but
two things are certain:
1. The field is growing and will become the largest and most important marketing
sector in coming years.
2. The growth will be driven by new innovations in technology.
On top of that, web users are becoming more aware and marketing savvy, and their
attention spans are shortening as desirable content becomes ever more quickly
available. This market is more likely to challenge debate and denigrate a brand but it
is also more likely to share good content and products with an exponentially growing
social circle. . Internet marketing is a dynamic field that is going to evolve considerably
in the next few years.
REFERENCES
1. Wikipedia: en.wikipedia.org/wiki/History_of_the_Internet
2. First network email: openmap.bbn.com/~tomlinso/ray/firstemailframe.html
3.
brief
history
of
the
internet:
ezinearticles.com/?a-Brief-History-of-
Internetmarketing&id=434488
4.
detailed
history
of
internet
marketing:
ecommerce.hostip.info/pages/708/
marketing-Internet-HIStorY-Internet-marketIng.html
5.
the
short
history
of
internet
marketing:
www.fastcompany.com/
magazine/139/click-here.html
6. Web 3.0: www.labnol.org/internet/web-3-concepts-explained/8908/
7.E-marketing -- A New Concept By Prashant Sumeet
8. http://www.brandchannel.com
399
campaigns that promote brands and encourage people to buy their products. It is a creative
and often intuitive process. The technology used to achieve this, however, requires skills in
mathematics, statistics and computing. How can these two different areas work together
effectively?
Three areas of marketing which have been transformed by digital are the speed, relevance
and reach of campaigns. Digital marketing has also greatly increased relevancy. Messages
can be targeted with a laser focus to very specific groups offering them relevant content.
Meanwhile, the reach of campaigns has also increased greatly. With so many different ways
that customers access media, whether through Facebook, YouTube, news websites, via
mobile or tablet apps, a strong idea can quickly gain huge scale.
Marketers need to update their skills in order to make the most of these fast-moving, and
highly relevant campaigns through digital Media. They need to work closely with data
specialists, web developers and social media professionals. The marketer of the future needs
to combine marketing and creative skills with an understanding of real-time technology. The
marketing team should consist of data scientists, engineers, developers and user experience
experts, who work together in small project teams to try and create growth. This is a radical
change from the way traditional marketing departments work. Just as marketers need to
become more savvy about technology, data and analytics, so the technically minded staff on
the digital side have to get more creative. A vital quality for marketers in the fast-changing
digital environment is curiosity, rather than any specific technical knowledge.
Those looking for a career in marketing must be prepared to bring together the magic of
marketing and the science of technology to create powerful and relevant marketing
campaigns.
12.1 IMPACT OF TECHNOLOGY ON MARKETINGCommunication helps businesses grow and prosper, creates relationships, strengthens the
effectiveness of organizations, and allows people to learn about one another. Technologies,
such
as
the
Internet,
mobile
phones, social
media,
and customer
relationship
management systems greatly affect the way companies communicate with prospective
customers. These new forms of communication are changing the media landscape and the
type of messaging strategy organizations use.
401
Many consumers and business professionals seek information and connect with other people
and businesses from their computers and phones. With access to many sources of information
and an interest in interactive media, consumers may collect more product information on their
own. Work environments are also changing, with more people having virtual offices, texting
on their cell phones, or communicating through social media sites such as Facebook,
LinkedIn, Pinterest, and Twitter. As the media landscape changes, the money that
organizations spend on different types of communication will change as well. Once
companies
have
developed
products
and services,
they
must
communicate
the values and benefits of the offerings to current and potential customers.
Integrated marketing communications (IMC) provide an approach designed to deliver one
consistent message to buyers through an organization's promotions that may span all different
types of media - such as TV, radio, magazines, the Internet, mobile phones, and social media.
Delivering consistent information about a brand or an organization helps establish it in the
minds of consumers and potential customers across target markets. With IMC, organizations
can coordinate their messages to build the brand and develop strong customer relationships
while also helping customers satisfy their needs.
Young people today are part of the millennial generation, and it is consumers from this
generation who are driving the change toward new communication technologies. A young
consumer might opt to get promotions via mobile marketing - say, from stores on your cell
phone as you walk by them or via a mobile gaming device that allows you to connect to the
Web. Likewise, advertisements on Facebook are popular as businesses continue to utilize
more social media. Traditional media (magazines, newspapers, television) compete with
media such as the Internet, texting, mobile phones, social media, user-generated content such
as blogs, and YouTube as well as out-of-home advertising such as billboards and movable
promotions. Therefore, all forms of marketing media have been forced to come up with
new innovations to remain relevant.
technologies to better understand what customers want and what they choose. Whether it is
through websites or surveys aimed at customers, or using the Internet to build knowledge and
information within business via data-analysis, customer surveys, web-analytics, market
intelligence or online experiments.
402
Research
Adobe & Econsultancy have recently partnered to produce the Quarterly Digital Intelligence
Briefing: Digital Trends 2015.
About 6,000 business professionals were surveyed, bringing together a broad spectrum of
data and insights from those who play in the B2C or B2B space.
Encouragingly, the report detailed that only 20% of businesses see digital marketing as being
entirely separate from the rest of their business operations. The vast majority, 43% of those
surveyed, see digital marketing as permitting across most marketing channels. On top of this,
14% see digital as being integrated with all marketing channels and visualise themselves as a
digital-first organisation.
From this, we can glean that organisational structures are slowly shifting to have digital
403
solutions central to their marketing outputs. CIO has most recently been discussing the rise of
the marketing technologist, that is the convergence of IT functions and marketing functions
into a dual-bodied role. In an article titled Coming to terms with marketing technology, Brad
Howarth dissects the reason for the shift as being two fold. Firstly, the relentless march of
technology to the point where technology now underpins most business functions, and
secondly, the cycles at which technology functions operate. Marketing teams tend to work
in fast-paced, campaign driven environments, and technology teams work on system
integrated solutions over a longer project timeline. For this reason, marketers are now more
determined to be involved in the technology requirements for their organisation, and vice
versa for the IT department; theyve become inextricably linked.
To put this into context with the Digital Trends 2015 report; respondents were asked to
answer the question: Which one area is the single most exciting opportunity for your
organisation in 2014? The data reflects that customer experience is the most popular for this
year, alongside content marketing, with each having 17% of surveyors measured.
404
Without having the technology backing behind the marketing activity, businesses would be
unable to increase their customer experience focus or produce high quality content marketing.
The systems underpinning these marketing channels are technologically driven and therefore
require IT support to function wouldnt it be easier to have a dual team which works across
both of these areas simultaneously?
According to Scott Brinker, author of the Chief Marketing Technologist Blog: The nature of
marketing has exploded from an ancillary communications function to the Grand Central
Station of customer experience. To provide this Grand experience, digital-first is indeed
going to be a large focus for the year to come across both marketing and technology
departments.
405
Professionals who have contact with customers are now "touching" with technology. With
each passing day, sales marketing, and even customer service positions are becoming
increasingly focused on technology. In a one-on-one interview with SearchCRM.com,
Stephen Diorio, President, IMT Strategies, shares his thoughts on the 12 impacts of
technology on sales and marketing. "Over the next ten years, rapidly changing technology
will impact most aspects of sales and marketing strategy and management," explains Diorio.
"In particular, the rush to deploy e-business, Web marketing and CRM solutions will
transform the role of the sales and marketing professional."
According to Diorio, to drive profitable growth, sales and marketing leaders should do the
following:
Maximize the return on investment (ROI) on all sales and marketing investments;
Find ways to leverage interactive, database, and network technologies to grow sales; and
In order to accomplish these points, management must reallocate the sales and marketing
investment mix to fund more high-performance Web marketing tools. Additionally, they must
invent new business models that "leapfrog" the competition and rewrite sales and
marketing rules.
One of the key challenges of this initiative will be to balance strategic planning with timely
action. Sales and marketing leaders will be distinguished from the follows by their
effectiveness in setting and following through on the right business priorities. Leaders will
move quickly to take advantage of opportunities such as Internet trading communities and
distribution through affiliate partnerships.
406
407
8. Customer interaction centers: Organizations must consolidate and integrate call center,
Web, e-mail, fax, and marketing technology assets to better manage selling resources,
technology infrastructure, and customer interactions.
9. Product channel readiness: Organizations must design modular, "channel-ready"
products optimized for specific sales channels, partners, and customer segments,
improving personalization, ease of doing business, and transaction costs.
10. Dynamic pricing and trading: Organizations must creatively manage the impact of buyand sell-side technologies and trading communities on margins and pricing.
11. Changing role of branding: Organizations must aggressively build brand equity in echannels, in virtual communities, and across multiple selling partners, channels, and
points of interaction (POI).
12. Interactive direct marketing: Organizations must deploy new tools, approaches, and
strategies for anticipating or influencing the way customers buy.
Determining which of these twelve areas are of most importance to your specific organization
is a first step in acknowledging the impact of technology on sales and marketing and in
moving your organization into the world of e-business.
12.2 CHALLENGES OF TECHNOLOGICAL COMPLEXITIES
With high consumer expectations and an explosion in engagement devices and channels,
marketers today are faced with a sprawling matrix of disconnected figures to make sense of.
Some tools today provide a more consolidated view of figures, but still, 71% of Chief
Marketing Officers (CMOs) feel unprepared for the data explosion they face. There are two
possible camps in modern marketing: those who "get it" and have intricate systems in place
to measure and act on the intelligence provided by multi-channel metrics, and those who
view metrics as a check-box item on their list of requirements something they know they
need but don't know how to leverage effectively.
Collecting metrics today means going beyond tracking the transaction and business
objectives. In order to leverage metrics strategically to create loyal and engaged clients,
businesses need to look at creating consolidated, personal views of their customers that span
channels. They need metrics that can come together to help paint a picture of the end-to-end
408
client relationship and show how to better target messaging to drive engagement. Marketers
need to find a way to break down the silos and connect the data sources. Only then can they
get a complete view of client interaction and transactions and leverage this data to build
strong relationships.
Connect users credit card, twitter and Starbucks account (APIs and programming)
Setup analytics dashboard to track the first 100k users who link their accounts with credit
cards (data analytics)
An incentive algorithm that sends a $5 gift card based on users actions (programming again)
Measure the success of the campaign on metrics like reach, purchases and loyalty (analytics)
Over 27,000 people have tweeted a coffee, some multiple times. This flurry of activity
generated over $180,000 in sales in just a couple of months.
Another example; IBM recently used its software to mine data from social media and
customer database to help a large consumer product company to figure out which movie stars
they could use as brand ambassadors in their marketing campaign.
Internet and connected societies are driving a seismic shift in business models. Amazon
409
simultaneously rivals Walmart as a store, Apple as a device maker, and IBM as a data
services provider. Twitters 40 billion+ valuations is not the work of its 2000 employees, but
of its more than 200 million contributors. Brands that once sought advantage based on the
strength of their internal resources now face competitors that harness the power of connected
users and ecosystems of external resources.
Changing consumer behaviour as a result of being location agnostic and constantly connected
is transforming marketing, as we knew it. Although up to this point, most of the impact has
been tactical; we are now at tipping point of major strategic transformation. At the centre of
this transformation we have fast evolving technologies such as big data, analytics, cloud,
social and mobile. These capabilities are not an area of traditional strengths within ad
agencies, marketing departments or even digital agencies. As per a recent online marketing
institute study; skills are inflated and talent is slim.
Marketing now relies upon software at an unprecedented scale and with massive implications
to identify, anticipate and satisfy customer needs, and measure the success of efforts. The two
largest sellers of online advertising, Google and Facebook are software companies at their
core and produce no content of their own. This is a paradigm shift, as all traditional
advertising channels are content producers.
Similarly, programmatic media buying or using software to automate the process of buying
and/or selling digital advertising is bringing significant efficiencies to advertisers in terms of
workflow, pricing and the avoidance of waste.
To survive and thrive this digital shift in consumer behaviour, the smart agencies will
redefine their core competencies to help brands succeed in what Forrester Research calls the
Age of the Customer. As data, analytics, cloud, social and mobile technologies see a greater
role in marketing, the technology skills organic to systems integrators will become more and
more critical must have marketing competencies.
The new challenges aside, theres never been a better time to be a marketer. Brand
perceptions are formed and purchase decisions made before a customer even talks with sales
or sees a product in a retail setting. Study by Ford suggests 87% of car buyers use web for
research resulting in average number of dealerships visits before purchase decline from 8 to
1.2. Its a huge opportunity to get there first and forge long-lasting relationships. This is a
410
time for re-invention of philosophies, methodologies, and develops new competencies that
affect how we engage with consumers across digital and physical touch points.
Conclusion
In conclusion, I agree that advertising & marketing, like any other industry is at the cusp of
fundamental disruption. However the core marketing skill set still remain relevant. We are in
a transition phase where we have traditional players with digital arms, native digital agencies
and technology companies starting to offer marketing solutions. Going forward the separation
between digital and traditional will increasingly blur. At the end of the day we will still
need an integrated full service agency that is relevant in todays context.
Over the coming years there is the opportunity not only for marketing to reinvent itself but
for marketing to be the change agent that transforms the whole business for marketers with its
Internet of Everything.
Source:
Boundless.
Impact
of
Technology
on
Marketing. Boundless
Marketing.
411
ABSTRACT
During the past two decades, many private schools in India have already implemented or are
planning to implement the digital media for education to enhance the learning process of their
students. The digital learning market is estimated at around $3 billion and is projected to
grow at 17.4% CAGR between 2013 and 2018. Indian governments Digital India initiative
has allocated Rs. 1.13 trillion to this sector.
Mr. Gautam Singh Area Sales Manager of STARlearn got a call from Mr. Talwar founder
owner and Chief Executive Officer of Vinaya Publications which owned STARlearn brand
in digital education space. The voice was crisp and the tone was grim. Gautam, can you
meet me in the afternoon for a performance brief of last one year? Mr. Talwar was visiting
Mumbai for a week and was meeting the sales managers of the different businesses owned by
Vinaya Publications. Mr. Gautam 35 year old man was concerned about the STARlearn
brand, specifically about the products STARevaluator and STARlearner. Yes boss, I will
be ready, he responded. Soon after he hung up the phone call, he called his two team
members Mr. Date (38 years) and Mr. Pradhan (45 years). They assembled together
immediately in the conference room. I have got the reports that you submitted about the
performance. I have called this meeting to get your views on why STARevaluator and
STARlearner are lagging in the market. Can we discuss the sales strategy and customer
feedback?
Mr Pradhan cleared his throat and replied, Our markets are not yet ready for the products. I
went to 500 schools in Mumbai in the last year. Around 90% schools told me that they didnt
have the hardware to support our products. There was a reluctance among school principals
about whether their teachers will be able to adopt the new technology and whether it will
really be useful for the huge investments. Mr. Date agreed to Mr. Pradhan and added, We
never used such tools in our schools when we were growing up. This is a new concept in
schools and for selling this we need to first sell this digital education concept to the schools.
Mr. Gautam dismissed the meeting soon afterwards as he wanted to think individually. He
thought of reflecting on the journey of Vinaya Publications since inception and the issue at
hand so as to find reasons of poor sales of STARevaluator and STARlearner among schools.
Vinaya Publications
413
Vinaya Publications was a family-owned business owned by Talwar family members. Vinaya
means humility, which is the main philosophy of the Talwar family as they think that education and
humility go hand in hand. Since 1970, Vinaya Publications was in the business of publishing
educational books. They have published around 2000 titles every year in English, Marathi, and
Hindi. In 1990, the group set up its own ultra-modern printing press at Budhwar Peth in Pune.
Vinaya Publications has two businesses 1) Content based business includes: (a) print publications
(b) digital products, and 2) Paper Stationary business.
Maharashtra State syllabus books such as workbooks, guide books, question sets. These form 80%
of the business. The supplementary books based on ICSE and CBSE board form about 20% of the
business. The state of operation is Maharashtra.
Foray in to digital education
In 2013, Vinaya Publications forayed in to digital education space. It decided to enter digital education space as
it did not have unique identification in the stationery business. Stationery business in India includes school
stationery, office stationery, writing instruments, and computer stationery (Indian Retailer, 2009).
The
stationery sector in India is mainly fragmented and has many small companies that account for 65% of the
revenues (John, 2015). The organized players such as Navneet (established in 1959), Bluebird, ITC, Camlin,
Hindustan Pencil Pvt Ltd. (established in 1958, and owns Apsara and Natraj pencils) and so on contribute to
35% of the revenues in the stationery business. Stationery is a commodity purchase for most of the consumers,
who are not brand conscious while buying stationery (John, 2015).
Vinayas Brands in Digital Education sector
Vinaya Publications established three brands in the digital education space STARscholar for the B2C
(business-to-customers) market, and STARevaluator and STARlearner for business customers such as schools.
STARlearner was the first product to go into the market. The features of the three products are given below.
STARlearner
STARlearner consists of animated visual copies of the textbook content, making the content more interesting for
students. It is based on the Maharashtra State Board Syllabus. The content comprises attractive and interesting
animation on the lessons in the textbook, making it easier for the children to grasp and understand the concept.
The key features of STARlearner are given below.
Features:
Easy operation
414
The software is priced Rs.1 lakh for complete Maharashtra State syllabus coverage from standard I
to X. The plan of Vinaya Publications was to enter in multi-year contracts with the schools. Mr.
Date has been able to get five year contract with ten schools in Mumbai since last two years. These
schools are private schools following the Maharashtra State board syllabus. The fees of these
schools are higher than others as the expenditure of the digital education interface need to be borne
from the fees. Mr. Gautam had projected to sign a contract with 30 schools in the two years. The
performance of the product was not up to the mark.
development and upgradation of the content which was outsourced to a well-known IT company.
STARscholar
STARscholar is a product for consumers and targets mainly parents who are key influencers in the purchase. It
includes audio-visual content for studying concepts and multiple-choice questions for doing self- evaluation. It
is available in CDs. One subject CD costs Rs. 250/- for one year syllabus. This product is available in select
bookstores in Mumbai, exhibitions, career fairs for students. Gautam has also promoted the product through the
schools which are customers for their stationery products. The sales of STARscholar CD are up to expectations.
Gautam had projected the sales to be 5000 in two years and the actual sales were 5200. Gautam thought he
could cheer about this product with his boss - Mr. Talwar.
STARevaluator
This product is meant for schools. It consists of a question bank, multiple-choice questions, and other questions.
It serves as a continuous evaluation tool for teachers to know if the students are following and applying the
concepts. It is priced on usage basis at Rs. 50/- per student per month.
STARevaluator is mainly used by schools in the exam week and has seasonal demand. The demand spikes
twice a year - March and October. This product was used by 20 schools in the last two years. The target was
set to 40 schools and the performance was below expectations.
Gautam thought of reflecting on the macro-economic trends that might affect the performance of eLearn
products in the market. He wanted to check the popularity of SSC, CBSE, ICSE, and IB schools, competitor
analysis.
415
authority. Private schools are run privately and do not get any regular maintenance grant from government.
The distribution of such schools in India is given in the exhibit 2.
Based on the level of education India has primary and secondary schools. Based on affiliation to boards India
has schools affiliated to Central Board of Secondary Education (CBSE), Indian Certificate Secondary Education
(ICSE), State boards, International boards, and National Institute of Open Schooling (NIOs), while few are
unrecognized. Brief information of these boards is given below.
1) Central Board of Secondary Education (CBSE) Formed in 1962, CBSE is the most popular
board in India with around 14000 public and private schools (EY; FICCI, 2014), (Infolona, 2015). The board is
recognized by the Union Government of India.
2) Indian Certificate Secondary Education (ICSE) First established in India during the British
rule, by the Local Examinations Syndicate of the University of Cambridge, it is a private and nongovernmental school board in India. The schools are mostly found in tier one cities in India (Infolona, 2015).
There are around 2000 ICSE schools in India (EY; FICCI, 2014).
3) Secondary State Certificate (SSC) this board is governed by individual state governments in states in India.
Each state board follows its separate syllabus and grading system and focuses on local state education. Fees are
relatively low in these schools as compared to CBSE, and ICSE schools (Infolona, 2015). These schools from
96% of the total schools in India (EY; FICCI, 2014).
4) International Board This consists of International Baccalaureate (IB) and International General Certificate
for Secondary Education (IGCSE). IB was founded in 1968 and is governed by International Education
Foundation headquartered in Geneva, Switzerland (Infolona, 2015). The number of schools in India following
this board are only 400 (EY; FICCI, 2014). International General Certificate for Secondary Education (IGCSE)
is a two-year programme that starts in class 9 th. The assessment of this programme is conducted by two UK
bodies - Cambridge International Examinations (CIE) and Edexcel (also known as London Examinations)
(Tikmany, 2005).
5) National Institute of Open Schooling (NIOS) It is an autonomous organization, established in 1989 by the
Ministry of Human Resource Development (MHRD), Government of India. Among various other courses it
offers secondary and senior secondary courses. This is meant for those students who are unable to take formal
schooling (National Institute of Open Schooling, 2012).
The distribution of schools in India based on the affiliation to boards is given in exhibit 1.
Mumbai and Pune are the two largest education hubs in Maharashtra. Mumbais population is 21.043 million
(Central Intelligence Agency, 2015) and Punes population is 9.218 million in 2015 (India Online Pages, 2015).
Mumbai has 3916 schools (Bhandary, 2014). In Mumbai, 75% students attend private schools (EY; FICCI,
2014). In Mumbai, majority of parents (belonging to higher socio-economic classes) send their children to
English medium private schools. Parents belonging to lower economic classes send their children to regional
language schools such as Hindi or Marathi (Mehta, 2014).
Conclusion
416
Mr. Gautam Singh thought that he needs to do targeting better and market products to those segments to achieve
the projected revenues. He wanted to prepare the revised targeting plan before his meeting with Mr. Talwar.
There was a lot of analysis to do and the time was short.
417
Sr. No.
Ownership
1
2
Government
Local
body
municipal
Private aided
157,000
Private unaided
181,000
818,000
/
309,000
Sr.
No.
Board affiliation
Number
of
thousands)
State board
1,415
CBSE
14
CISCE
Unrecognized
34
International Board
0
National Institute of Open Schooling (NIOS
agencies)
6
418
schools
(in
1.0 INTRODUCTION
Innovation has become a must in all walks of life. Looking beyond what is being done
at present and thinking out of the box is what Innovation is all about.
Technology is evolving at a very fast pace. Driverless cars have become a reality and
can help greatly in preventing accidents. Technology has benefited mankind in several
ways. Organizations cannot any more keep their eyes closed on the technological
advances happening around.
Decision making has to be based on facts. Facts are information obtained from various
sources. Information is data collected at several points in an organization and processed
using computerized systems. Data in most organizations is very large and complex. Big
Data is a broad term for data that is large and complex that the traditional data
processing applications are inadequate.
1.1 INNOVATION
Innovation can be classified into Incremental Innovation, Radical Innovation and
Breakthrough Innovation. Small improvements on continuous basis, also known as
Kaizen in Japanese is all about Incremental Innovation. Bringing about improvements
on a larger scale is known as Radical Innovation. Breakthrough Innovation is bringing
about drastic changes in all the resources in line with changing situations and
419
1.2 TECHNOLOGY
Technological and Digital Innovation is transforming many industry sectors. Big Data
requires exceptional technologies to efficiently process large quantities of data within
tolerable elapsed times. McKinsey report (2011) suggests suitable technologies which
include Crowdsourcing , Data Fusion and Integration, Genetic Algorithms , Machine
Learning , Natural Language Processing, Signal Processing , Simulation, Time Series
Analysis and Visualization. Real or near real time information delivery is one of the
defining characteristics of big data analytics.
3.0 METHODOLOGY
The research is more exploratory and descriptive in nature. The data is collected from
secondary sources such as research papers and articles from various sites , books on
corporate longevity and company websites. The author has used convenience sampling
and picked up 28 organizations at random for further secondary research. The author
observed from the literature review
Flexibility and
adaptability are
essential
for
survival.
422
people and
Year of
establishment
1788
Bombay Dyeing
1879
Dabur
1884
423
Kirloskar
1888
DCM
1889
Britannia
1892
Century Textiles
1897
1897
Shalimar Paints
1902
10
Tata Steel
1907
11
ITC
1910
12
TVS
1911
Year
establishment
1802
1806
1824
1837
1883
1892
1898
1899
1901
1902
1903
1906
1908
1911
1937
1939
of
A company that was making punch card machines and mainframe computers occupying
huge space today makes supercomputers that can beat human chess champions. We are
talking of IBM which has survived more than 100 years by constantly adapting through
technology shifts. Technology trends are so fast moving that many companies in the
industry tend to rise fast only to flame out. The speed of change in technology makes
longevity a challenge. IBM demonstrated a strength i.e. ability to change fast. IBM
introduced new technology from clocks , butcher scales and coffee grinders to punch
card machines and typewriters to tape storage , mainframes and personal computers
424
George Eastman came up with an affordable combination of roll film and camera in the
1890s and Kodak traded successfully on the back of his innovation for more than 100
years. The company knew about the coming digital revolution. In 197 5, an employee
invented a crude digital camera. But analog film remained a huge generator of cash
the peak year for roll film sales was as late as 1999. Digital technology was a risky
investment in the eyes of analysts , investors and , until it was too late, most executives.
Kodak filed for Chapter 11 bankruptcy protection in 2012, emerging in 2013 , as a
much smaller business selling imaging equipments and services to businesses.
Bill Hewlett and Dave Packard decided to first start a company and then figure out
what they would make. They were opportunistic and did anything that would bring in a
nickel. HP learned humility early in life, due to a string of early failures and only
moderately successful products. Yet Bill and Dave kept tinkering, persisting, trying and
experimenting until they figured out how to build an innovative company that would
express their core values and earned a sustained reputation for great products. They
quickly made the transition from designing products to designing an organization and
creating an environment conducive to the creation of great products.
We all know who is known as the father of mass production and assembly line concept.
Henry Ford founded the Ford Motor Company in 1903 to capitalize on his automotive
engineering talent. Ford was one of 502 firms founded in United States between 1900
and 1908 to make automobiles. The famous Model T in black color launched in October
1908 is still talked about in automobile circles all over the world. With this Model T,
Ford transformed the American way of life for several million families who could start
affording an automobile. Ford reduced the price of Model T by 58 percent from 1908 to
1916. Ford redefined the sequence of the three Ps People, Products and Profits. At
that time, Ford had more orders than they could deliver. They could have easily raised
prices. To quote Henry Ford I dont believe we should make such an awful profit on
our cars. A reasonable profit is right, but not too much. I hold that it is better to sell a
large number of cars at a reasonably small profit. I hold this because it enables a larger
number of men employments at good wages. These are the two aims I have in life.
Tata steel has manufacturing operations in 26 countries including India, China, UK,
Netherlands, Singapore and Australia and employs close to 90000 people.
Tata Steel (originally TISCO) was established in 1907 by JN Tata at Jamshedpur. In the
early 1980s they initiated a modernization program of their steel plants. To quote the
then Managing Director J.J. Irani , We would have been finished otherwise. You
cannot fight a modern-day war with weapons of the Mahabharata. We would have been
annihilated had we not modernized. We realized this and embarked on the four phases
of modernization. We addressed our drawbacks like the steel making process, our
weakest link. By Mid -1990s, Tata Steel had become Indians most cost effective steel
plant and Asias first integrated steel producer. They gave equal importance for Quality
and Environment. By 2000 almost all their divisions were certified for ISO 9001
(Quality Management System) and ISO 14001 (Environment Management System). In
the beginning of twenty first century, Tata Steel had completed four phases of the
modernization programme with an investment of close to Rs 60 billion. The
achievements of Tata Steel were mostly attributed to its implementation of Total
Operational Performance (TOP). The Top Program aimed at large improvements in
Throughput, Quality and Cost both in the short term and in the long term.
In the WSD ranking in 2001 (World Steel Dynamics), Tata Steel was ranked No 1
ahead of world leaders like Posco of South Korea, Baosteel of China and Nippon Steel
of Japan.
Subsequent to the implementation of TOP program, Tata Steel adopted another program
titled Performance Ethic Programme (PEP). Under this programme , they promoted
hardworking and result oriented young people to higher positions depending on their
performance, rather than following the convention of seniority. PEP had two core
elements. Firstly, it proposed a new organizational structure, which resulted in fostering
growth businesses, introduced better flexibility in decision making process, clearly
defined accountability and encouraged teamwork at all levels. The result of PEP was
introduction of a transparent Performance Management System (PMS) which helped in
identifying and rewarding strong performers and ensure enough development
opportunities for deserving employees. Though these programs, Tata Steel reduced the
hierarchical levels from 13 to 5, which in turn resulted in increase in speed and
accuracy of communication and faster decision making at all levels.
Tata Steel at the right time used Information Technology as a Strategic Tool. They
formed cross functional teams bringing in executives and managers from various
426
functional areas such as Marketing, Operations, Finance, Engineering etc, and also
included consultants from Arthur D Little and IBM Global Services. The main
responsibilities given to the teams was to re-design two core business processes Order
Generation & Fulfilment and Marketing Development. The aim of the program was to
enhance Customer Focus (The first Principle in Eight QMS Principles) by enabling
better credit control of Reduction of stocks. Tata Steel was among the first to introduce
ERP system. They went in for SAP R/3. They called the team as ASSET Achieve
Success through SAP Enabled Transformation. The team went about integrating SAP
into the then existing information system and made it compatible with future SAP
implementations. The business processes became more efficient. Improvements were
found in Customer Service and Productivity. The introduction of SAP also brought
down the inventory carrying cost from Rs 190 per ton to Rs 155 per ton in less than two
years.
Every member of the global Tata Steel family is bound by a Corporate Culture that is
shaped by the values that guide every business decision.
Tata Steel has adopted an integrated Business Model to support its vision of being a
global leader in creation of value, while being a steel industry benchmark organization
in corporate citizenship in its efforts towards Social Responsibility and Environmental
Performance.
A strong commitment to the cause of sustainable development, dedicated adherence to
Environment Management Systems and Quality Standards and a strong belief in
inclusive growth have led the company to earn a number of national and international
awards and accolades.
Buyers Market from Sellers Market. Hindustan Motors vehicles were conforming to
Euro 1 emission norms but they failed to recognize the speed at which the world was
morning from Euro 1 to Euro 4 norms implementation.
No competition led Hindustan Motors to complacency and they did not pay the required
extra attention to focus on customers. They did not make serious efforts to anticipate the
future requirements of customers. Some reports say that old Ambassador cars had to be
taken to workshop after delivery of cars from showrooms for re-welding and certain
other modifications for the basic driving situation. Another report (may be partly in a
lighter vein) said that the car used to make lot of sound from each part of the car except
the horn while driving the car.
Fuel efficiency is another area which Hindustan Motors did not pay required attention.
1981 saw the entry of small fuel efficient Maruti 800 with better aesthetics. This
marked the beginning of the downfall of Hindustan Motors. When Hindustan Motors
realized that they are not able to fight the competition, they could have adopted the
strategy If you cannot compete, better collaborate. They could have partnered with
MUL (Maruti Udyog Limited) to develop fuel efficient engines for their future models.
Despite having a wide distributor network, they were unable to hold their position in
market due to their inability to devise marketing strategies with the changing times and
changing customer preferences. It was too late (1997), Hindustan Motors signed a JV
with Mitsubishi.
On the People Management Front, they never thought it fit to pay attention. There were
lot of internal squabbles as well as union problems. HRM was not practised effectively.
The secret behind rise of MUL is their effective HRM policies.
Hindustan Motors did not take care of any of its stakeholders. They never paid any
dividend to its shareholders. CITU, the trade union of CPM had its own part to play in
the downfall. The Birla Management seemed to have lacked the guts to confront them
or the will to find mutually acceptable solutions.
Hindustan Motors also did not pay attentions to improve Productivity and Quality. They
also did not think of reengineering the shop floor processes.
Hindustan Motors could not capitalize their strengths in the premium segment. The
market share in premium segment was eaten up by Maruti Udyog and Honda. This was
mainly due to the attractive advertising and effective marketing strategies of the
competitors.
428
Six themes of Six Sigma was initiated and implemented by Jach Welch at GE. The six
themes are Customer Focus, Facts and Figures, Process Focus, Management &
Improvement, Pro-active Management, Boundaryless Collaboration and Strive for
Perfection. Boundaryless collaboration is all about close interactive working between
the various processes inside the organization as well as with the suppliers and dealers
external to the organization. Strive for perfection is all about aiming for Zero Wastes
and Zero Defects.
had been in place for over two decades. In 1990, Kodak had launched its Photo CD
system for storing photographic images. With leadership that constituted senior
executives recruited from Apple, GE, HP and Motorola, Kodaks digital imaging efforts
tasted successes.
Kodak could not sustain their competitive advantage and faced major competitive
challenges from Fuji and Polaroid. The advent of the PCs ushered in a variety of new
printing technologies.
The emerging digital value chain in the beginning of twenty first century made things
more difficult for Kodak. Photography evolved rapidly from the traditional chemical
based technology to a digital technology. The introduction of mobile phones with
cameras made things still worse for Kodak. The customers took digital pictures,
downloaded them onto their computers, edited them and transmitted them through the
430
internet for others to view electronically. That is how the new digital value chain made
redundant most of Kodaks core competitive advantages.
Kodak emphasis more on printed images. Their digital strategy from 1993 to 2012 was
the belief that digital technology would not eliminate printed images. Perhaps, this is
where they went wrong. Their emphasis on printed images was reinforced by its own
capabilities; the printing of photographic and other images onto paper and other media
lay at the heart of Kodaks traditional chemical and chromatic knowhow. Kodak made
the mistake of investing heavily in its printing knowhow and in printers: both
commercial and consumer. Their decision to make a major investment to build Kodaks
presence in the market for consumer inkjet printers has been the most widely criticized
of all their digital imaging initiatives.
Kodaks forecasts proved wrong in relation to emerging market demand. Their
acquisition of Chinese photographic film producers were based on the assumption that
the sales of roll film would continue to increase into the twenty first century.
Experts opine that the transition period between traditional and digital imaging could
have been better managed by Kodak by exploiting its brand loyalty and vast distribution
system and by offering hybrid solutions while building the resources and capabilities
required for digital imaging.
Kodak was initially successful in adapting to a highly disruptive technological
revolution. Kodak was also able to build the capabilities needed to become a significant
player in a radically different area of technology. Kodak was not slow to recognize the
digital threat. Kodaks market leadership in digital cameras pointed to its ability to build
technological knowhow, apply that knowhow to develop attractive new products, and
market those products in fiercely competitive digital markets.
Perhaps Kodaks Product Market Strategy did not pay off. Their emphasis seemed to
be on the wrong markets and wrong products. Kodaks biggest losses had been in the
consumer market, their traditional stronghold at one point of time. There were strong
similarities between Fuji and Kodak. Both were heavily dependent on film during the
1990s and both diversified into other imaging technologies. The main difference lies in
Fujis business diversity. Fuji perhaps did better in scanning the internal and external
environments and were quick to act on the findings of the same.
We can conclude that forecasting of technological developments through better data
management and effecting innovations at the right time steered Kodak through
431
competitive pressures. At the same time , the strategies on products and markets for
sustainable competitive advantage did not work well for them. Innovation not only on
products but on processes, people and markets are equally important. Innovation is a
never ending activity.
11.0 Conclusion
We can conclude from the analysis of few companies who have lived long and are
continuing to do well is that one common thread binds all of them the thread of
Innovation, Technology and Data Management.
We have also studied a few companies who have lived long and did not update their
technology or going for innovations at the right time or did not set up proper data
management systems have perished sometime or the other. There are few companies
not included in our list mainly because they are not more than 75 years old. But some of
the companies such as Apple and Microsoft and some Indian organizations like Bajaj
Auto and Bharath Forge have been performing extremely well because of their giving
special attention to Innovation, Technology and Data Management. These companies
are definitely likely to live longer. Technological upgradation at the right time using
data from customers and competitors, making Innovation a habit in the organization and
proper management of Big Data for decision making in all areas and at all levels are the
key factors for the success and longevity of an organization.
References:
Collins Jim and Porras Jerry Built to Last (2002), Harpercollins Publishers.
https://en.wikipedia.org/wiki/Big-data
www.hmchen.shidler.hawaai.edu/chen-big-data-MISQ.2012
www.usatoday30.usatoday.com/money/companies/management/2011-06-15-ibn-corj
www.tatasteel.com/sustainability/sustainability-awards-asp
www.rediff.com/business/slide-show-1-special-16-companies-that-have-survived-over100-years-in-india
http://en.wikipedia.org/wiki/list-of-oldest-companies
www.slideshare-net/laurenDPerry/ge-case-study-16389395
www.casestudies10.weekly.com/uploads/9/0/0/2/9002260/Hindustan-motors-casestudy-ppt
www.tata.com/innovation/articleinside/investing-in-innovation
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ABSTRACT
The developments in IT are the working wonders in all the fields of activity. It has become
possible to send and receive information almost instantaneously. If circulars do not reach the
agents on time or doubts are not cleared quickly, or the agent does not have details of the new
plans announced in the press, the agent may face awkward situation with the prospects.
Insurance companies face problems which can be totally ducked with the use of technology.
The insurers who are conventionally have been quick to adapt latest developments in the field
of IT. The scope of information technology will vary between insures. The IT has constantly
played a very imperative role in the operations of every insurance company. The fact is that
of all the business establishments in the facility sector, of the life insurance companies were
the first to adopt Computerization as an incontrovertible part of their operation all over the
world.
The swift innovation in the area of information and communication technology has stood
with serious challenges for the insurance industry in India. The practice with the application
of information technology in comprehensive variety of guarantors operations has now
become strategic in the sense that it has direct impact on the efficiency of resources, and a
steepening impact on reducing the case of various activities.
With the entrance of private insurance players, the competition has become more powerful
and an important role is being played by the insurance sector. The use of information
technology is not new to the insurance sector, yet we may find constricted computerization
regarding the use of information technology in various departments of the insurance
companies including the major players from past several years. The most evident departments
are accounting, Legal issue and servicing, claim processing, sales management etc.
433
INTRODUCTION
Insurance industry is an important part of the economy and a supporting system of financial
markets. The funds appropriated from the sales of various insurance policies, leads to
economic prosperity, creating employment & long-term and profitable investments. On the
other hand, insurance industry by compensating losses due to adverse events and providing
insurance coverage against various risks/claims supports all sectors of the economy. Thus, it
provides the security and safety of the community and its people (Rekovska, 2001). In recent
years, usage of information and communication technology as a centerpiece of global
developments is undeniable and causes to expedite things done. Nowadays, in any business,
such as e-banking, e-learning and e-insurance we can find the signs of IT and Internet as a
key tool, make it possible to use effective and efficient utilization of information within the
organization.
An important application of information and communication technology, the use of these
technologies for re-engineering the architecture of the insurance industry, increasing the
speed access to information, greater efficiency and better. The ICT has developed an
electronic insurance. Other major usage of ICT is in the service sectors such as banking,
insurance, marketing, trade, education and tourism cause a lot of advantages for them.
Applying information and communication technology in the insurance industry for rapid
access of information and use it for decision making and planning is essential. So, a lot of
developing countries are trying to code and implement electronic insurance projects, adapt to
the realities of the new environment and benefit from its advantages.
In fact, if the insurance plan is designed and implemented so efficiently and purposefully, the
public and private sectors of insurance industry have profound institutional reforms.
Insurance services are sensitive to information, which means that the flow of information
between different parts of customers and insurance companies is necessary.ICT is emerging
as a phenomenon with its own attractions and has an important role in insurance market.
Development of e-trade makes insurers more than product orientation to customer
orientation. Since search costs for policy holders is less, Transparency in pricing, products
quality and insurance services increases.
Electronic insurance results of development in ICT. The usage of ICT in insurance industry
increases production capacity, specialization of activities and improves speed and quality of
services. In general perspective, electronic insurance provides customers access to insurance
services by using safe intermediates and without physical presence. According to another
definition, e-insurance is application of information technology and redesigning business
procedure in order to provide optimal insurance services and facilitating inter-action between
people and insurance industry.
E-insurance is divided into two areas. The first area offers the electronic services in a way
that removes the barriers of traditional methods and replaces them with easy access methods.
The second area involves the simplification and improvement of business process and
insurance operation in a way that reduces the operational needs and expectations of insurance
industry. The Internet provides an opportunity for insurance companies, recently entered this
market to avoid costly and lengthy process of traditional sales network.
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The close relationship between ICT and insurance industry due to the widespread use of ICT
globally, are due to the following reasons:
1. Increased speed and quality of insurance services to policy holders of insurance
companies.
2. Increased speed and accuracy of data entry for policy holders and insurers for better
and faster insurance services.
3. Processing of recorded information, in order to reduce human errors and increase the
speed of decision-making.
4. Reduce fraud and disadvantages of phony and illegal services.
5. Increase the ability of insurance companies to establish contacts with international
insurers to use global knowledge and expertise.
6. The emergence of new risks with new insurance requirements.
7. Updates Insurance mechanized system on the latest hardware and software.
8. Elimination of lengthy and costly process of issuing insurance policies, call center and
Increases accuracy in insurance activities.
9. Speed up the process of issuing insurance policies and pay damages compensation.
435
Over the last few years, mobile devices have evolved into machines with formidable
computing power. Packed with advanced features such as large touch screen displays, faster
multi-core processors, larger storage capacity, advanced imaging, and location awareness,
these devices will play a major role in supporting applications for key stakeholder
436
437
438
440
Given the increasing complexity and likelihood of data breaches, companies are finding
cyber insurance provides a measure of security. Cyber insurance, unlike traditional insurance,
is designed to meet the needs of companies in the digital age.
As with all types of coverage, however, cyber insurance has its limitations. Companies would
do well to thoroughly research all their options before deciding to invest in cyber insurance or
other means of data breach prevention.
CONCLUSION
The online services can be improved with some more efforts of the insurance companies by
providing online services as per the users expectations. An attempt has also been made to
find the most influential source of benefit and awareness regarding online transaction and to
find some other sources which can be used for awareness. Only Calculate premium payment
and seeking product and rate information from the website is the most preferred service by
the respondents. It is also online, except those related to foreign exchange transactions, loan
interstate enquiry.
The insurance firms in India have implemented information technology systems in their firm
with private sector slightly lower than public sector. The employees young in agewith high
potentials easily understand the application and efficient use of new systems. Further, brand
and image promotion will create demand for the online insurance. Increase of sales and good
knowledge of management and better stakeholder relationship will be considered important
with respect to corporate related benefits while transparency, speed of claim management and
desired CRM through continuous service and high productivity will be considered important
customer related benefits. Thus, it is believed that insurance companies must try to find out
the specific needs of different customers so that pertinent services as per their expectations
can be provided to attract customers and retain the market share.
REFERENCES
1.Richard L. Manning & Matilde K. Stephenson, (1985) Information Technology in the
InsuranceIndustry: A Forecast of Utilization and Impact, The Journal of Risk and Insurance,
Vol. 52, No. 4 (Dec., 1985), pp. 711-722
2. Chiara Francalanci, (1998), Information Technology and Worker Composition:
Determinants of Productivity in the Life Insurance Industry, MiS Quarteriy, June 1998, pp
228-230
3. Mark v. Pauly, bradley herring and David Song, (2006) Information Technology and
Consumer Search for Health Insurance, Int. J. of the Economics of Business, Vol. 13, No. 1,
February 2006, pp. 4563
4. S Krishnamurthy, S V Mony, Nani Jhaveri, Sandeep Bakhshi, Ramesh Bhat and M R
Dixit, and Sunil Maheshwari, (2005), Vikalpa ,Volume 30, No 3, July - September 2005.
5.Amy Newell, (2002), Online Insurance Industry Enjoys Net Gains, Banking Technology
News,
February 2002, pp 24-25.
6. Dr. C K Hebbar, Sandeep S Shenoy, Guru Prasad Rao and Abhishek Rao(2014) IRJBM
(www.irjbm.org ) Volume No VII October - 2014 Issue 10 Page 79
WEBSITES
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1. http://www.insurancetech.com
2. http://www.networkmagazineindia.com
3. http://www.wikipedia.com
4. http://www.howstuffworks.com
5. http://search.ebscohost.com
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Rajendra Prasad G R,
Research Scholar,
Institute of Management Studies,
Kuvempu University,
Jnana Sahyadri, Shankaraghatta, Shimoga 577451.
rajendraprasadgrr@gmail.com, mob: 09164520727
2
Dr. Manjunath, K. R
Assistant Professor,
Institute of Management Studies,
Kuvempu University,
Jnana Sahyadri, Shankaraghatta, Shimoga 577451.
manjurajappa@gmail.com, mob: 09480012101
Abstract
Training and development play an important role in the effectiveness of inclusive and
sustainable growth in organizations and to the experiences of employee in work for
individual sustainable. Training has implications for creating work effectively, productivity,
health and safety at work and personal development. It also means that operational personnel
employed in the organizations main business functions such as production, maintenance,
sales, marketing and management support must also direct their attention and effort from time
to time towards supporting training and development activities. On the other hand
organizational performance is a collection of work activities, efficiency, effectiveness and
tardiness at work; their measurement and subsequent outcome of the work activities; while
job satisfaction is defined as employees affective reactions to a job based on comparing
desired outcomes with actual outcomes for organization and individual sustainable growth.
This study carries two dimensions such as Training and development and employee
performance with two inter-dependent variables such as Work efficiency and Job
effectiveness by Training and the data is obtained by review of earlier literature. The purpose
of this study is to examine and gain a better understanding of the drivers that influence the
Training and Development practices and its impact on creating work force efficiency for
maintaining long sustainable growth of the organization.
Key words: Training and Development, Efficiency, Development, Training Methods, Work
effectiveness.
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Introduction
Training and development is very crucial to the employees, the organization and their
effectiveness. The organizations have long understood that their most valuable asset is their
human capital and many are convinced for large investments in employee training and
development. It is an undisputed fact that effective training is an investment in the human
resources of sustainable growth of the organization, with both immediate and longrange
returns as work force of the organization. However mere investment is not enough; firms
need to manage training programs more effectively so that they can get the highest returns
from their investment.
Training as a tool to holds the key to unlock the potential growth and development
opportunities to achieve a competitive edge. In this context, organizations train and develop
their employees to the fullest advantage in order to enhance their effectiveness. Performance
of an employee is a dependent factor on variables like knowledge, skill and abilities. Training
and development provides employees required knowledge, skills and abilities to do a job.
Training is a tool to fill the gap and the firms should use it wisely to improve employee
productivity1.
Training is considered as the process of upgrading the knowledge, developing skills, bringing
about attitude and behavioral changes, and improving the ability of the trainee to perform
tasks effectively and efficiently in organisations (Wills, 1994; Palo et al, 2003; Robert et al,
2004). Similarly, Stewart (1996) combines the two concepts of training and development and
gives an organization function which has the outcome of ensuring that the contribution of
individuals and groups in achieving the organizational objectives through the development of
appropriate knowledge, skills and attitude of the employees. The contribution and
improvement of organization performance is primarily through development of people as
individuals, work groups and as members of the wider organization. Furthermore, training
and development of employees is a systematic process that intends to ensure that the
organization has effective employees to meet the exigencies of its dynamic environment. This
is inclusive of adding to the employee knowledge, skills and attitudes required by an
individual to improve his performance in the organization2.
Review of Literature
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Sriyan de Silva (1997)3 in his article describe about developing a national role in training is
important for an employers' organization for several reasons. First, it enables the organization
to contribute to the development of a country's human capital, to better serve business needs.
It also enables it to influence employers in regard to the need for them to invest more in
training and employee development. Second, it provides an important service to members,
especially in industrial relations in respect of which sources of training for employers in
developing countries are few. Third, it is an important source of income provided the
organization can deliver relevant quality training. Fourth, it compels its own staff to improve
their knowledge without which they cannot offer training to enterprises through their own
staff. Fifth, the knowledge required for training increases the quality of other services
provided by the organization. Sixth, it contributes to better human relations at the enterprise
level and therefore to better enterprise performance, by matching corporate goals and people
management policies. Finally, it improves the overall image of the organization and invests it
with a degree of professionalism.
Dr. Ambika Bhatia and Lovleen Kaur
not keen to join an organization where their Knowledge and skills are not upgraded. Many
organizations provide opportunities for learning and use it as a retention tool. A large number
of organizations use the strategy of proper & effective training by increased their training
budgets to retain and get quality output from the employees. Employees are delegated with
different role & responsibilities & training helps them to accomplish these roles &
responsibilities & prepare them for the future responsibilities as well. This paper presents the
value of training practices worldwide. Also the study is aimed at studying the current &
expected future training trends worldwide. The training initiative taken by Indian
organizations has also been discussed.
V.Rama Devi and Mr.Nagurvali Shaik (2012)4 in their article evaluate about Training and
development ultimately upgrade not only the performance graph employees but also of the
organization. It has been rightly said, employee development is the key to sustain
organizational development. The 21st century will belong to those organizations, which are
able to learn faster than their competitors. Training improves the drive, initiative and quality
of work of the employees thus assist them to be more committed to achieving the goals and
objectives of the organization and this has the tendency of enhancing effectiveness among
employees within the organization. Training and Development function enables human
capital to unleash their dexterity. A profound training program acts as a vehicle to enhance
445
employee skills and enable them to perform better in their job. Training and development is
very crucial to the employees, the organization and their effectiveness.
Raja Abdul Ghafoor Khan, Furqan Ahmed Khan,Dr. Muhamma Aslam Khan (2011) 6
in their articles discuss Training and Development, On the Job Training, Training Design and
Delivery style are four of the most important aspects in organizational studies. The focus of
current study is to understand the effect of Training and Development, On the Job Training,
Training Design and Delivery style on Organizational performance. All these have positive
effects on the Organizational Performance. It improves the Organizational Performance. On
the Job Training is very effective and it also saves time and cost. Training and Development,
On the Job Training, Training Design and Delivery style have significant effect on
Organizational Performance and all these have positively affect the Organizational
Performance. It means it increases the overall organizational performance. The training &
development is the independent variable and organizational performance is the dependent
variable. These two variables have been chosen to see the relationship between these
variables i.e. to see the impact of Training & development on the organizational Performance.
Herman Aguinis and Kurt Kraiger (2011)7 in their article provides a review of the training
and development literature since the year 2000. Literature was focusing on the benefits of
training and development for individuals and teams, organizations, and society. Researchers
adopt a multidisciplinary, multilevel, and global perspective to demonstrate that training and
development activities in work organizations can produce important benefits for each of these
stakeholders. We also review the literature on needs assessment and prep-training states,
training design and delivery, training evaluation, and transfer of training to identify the
conditions under which the benefits of training and development are maximized.
Jelena Vemi (2007)8 in his research describe about Training and development of employees
is a continuous procedure which is the only meaningful and logical approach in the condition
of knowledge obsolescence, dynamic changes and increasing need for constant product and
service innovations. Human resources represent intellectual capital which is the new source
of organizational resources, and the organization could increase them only through training,
development and motivation of employees. The prosperity of organizations becomes
explicitly dependent on the intellectual capacity of their employees and their ability to change
and adjust to the dynamic business environment.
Training presents a prime opportunity to expand the knowledge base of all employees, but
many employers find the development opportunities expensive. Employees also miss out on
work time while attending training sessions, which may delay the completion of projects.
Despite the potential drawbacks, training and development provides both the organization as
a whole and the individual employees with benefits that make employee creating work most
efficiently. Most employees have some weaknesses in their workplace skills. A training
program allows employees to creating work properly and those skills that each employee
needs to improve. A development program brings all employees to a higher level, so they all
have similar skills and knowledge. This helps reduce any weak links within the division who
rely heavily on others to complete basic work tasks. Providing the necessary training creates
an overall knowledgeable staff with employees who take over for one another as needed,
work on teams or force on work independently without constant help and supervision from
others.
An employee who receives the necessary training is better able to perform job. Employee or
manager becomes more aware of safety practices and proper procedures for basic tasks. The
training may also build the employee's confidence because employee has a stronger
understanding of the organizational goals in Training practices. This confidence may push
employee to perform even better and think of new ideas that help to reach firm and individual
performance. Continuous training also keeps employees on the cutting edge of firm
developments.
To Study the Training and Development practices by organization and its creating work
force efficiency
To Analyze the Training and development concept practices prevailing improve work
efficiency
447
448
Training and development programs can help in improving the quality of work produced by
the workforce of organization. Mostly, training is given in a specific area like finance,
marketing or HR, which helps in improving the quality of work in that particular area.
2. Enhance employee growth
By attending these training and development programs, employees are able master the work
of their jobs and that's how they develop and grow themselves in a professional way.
3. Prevents obsolescence
These programs help employees to keep themselves up to date with the new trends in latest
technology, which reduces the chances of termination of the job.
4. Assisting new comer
These programs help new employees to adjust themselves in a new working environment,
culture and technology. They feel themselves as regular employees of that organization.
5. Bridging the gap between planning and implementation
It helps organizations to easily achieve their targets and goals what they actually planned for.
Employees know their job better and they deliver the quality performance according to needs
of top management. That's why organizations can easily implement their plans.
6. Health and safety measures
Training and development program clearly identifies and teaches employees about the
different risk involved in their job, the different problems that can arise and how to prevent
such problems. This helps to improve the health and safety measures in the company9.
Increased productivity
449
Improved quality
Higher morale
Prevention of obsolescence
Assess Training Needs: The first step in developing a training program is to identify and
assess needs. Employee training needs may already be established in the organizations
strategic, human resources or individual development plans. Building the training
program from scratch (without predetermined objectives) then need to conduct training
needs assessments.
Set
Organizational
Training
Objectives:
The
training
needs
assessments
(organizational, task & individual) will identify any gaps in your current training
initiatives and employee skill sets. These gaps should be analyzed and prioritized and
turned into the organizations training objectives. The ultimate goal is to bridge the gap
between current and desired performance through the development of a training program.
At the employee level, the training should match the areas of improvement discovered
through 360 degree evaluations.
Create Training Action Plan: The next step is to create a comprehensive action plan
that includes learning theories, instructional design, content, materials and any other
training elements. Resources and training delivery methods should also be detailed. While
developing the program, the level of training and participants learning styles need to also
be considered. Many companies pilot their initiatives and gather feedback to make
adjustments before launching the program company-wide.
Evaluate & Revise Training: As mentioned in the last segment, the training program
should be continually monitored. At the end, the entire program should be evaluated to
determine if it was successful and met training objectives. Feedback should be obtained
from all stakeholders to determine program and instructor effectiveness and also
knowledge or skill acquisition. Analyzing this feedback will allow the organization to
identify any weaknesses in the program. At this point, the training program or action plan
can be revised if objectives or expectations are not being met11.
Trained employees do not require tight control and supervision as they are well aware of
how to perform a job.
Trained employees can show higher performance by making optimum and best utilization
of the materials, tools, equipments and other resources provided to them.
Trained employees minimize wastages of resources in the organization and work both
efficiently and effectively.
Training develops a line of proficient and skilled managers as it prepares employees for
complex and higher level tasks.
Trained employees adjust to the job better and there are fewer rates of absenteeism and
turnover.
Trained employees enable the organization to face competition from rival firms.
Trained employees can respond and adapt to the changing technology well.
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Trained employees become more proficient and, thus, their earning potential increase12
On the job training- On the job training methods are those which are given to the
employees within the everyday working of a concern. It is a simple and cost-effective
training method. The in proficient as well as semi- proficient employees can be well trained
by using such training method. The employees are trained in actual working scenario. The
motto of such training is learning by doing. Instances of such on-job training methods are
job-rotation, coaching, temporary promotions etc13.
Job rotation
Job rotation is considered as an effective tool for successful implementation of HR strategy. It
is about settling employees at the right place where they can deliver the maximum results. In
todays highly competitive world, this can be proved as the best strategy to find the
immediate replacement of a high-worth employee from within the organization. Finding the
most suitable people and shifting them to take on the responsibilities of a higher level is a
tough task. Job rotation helps HR managers determine who can be replaced by whom and
create a suitable and beneficial fit. A properly planned and carried job rotation process plays
an essential role in strengthening the position of an organization and helps it deal with
uncertain and tentative outer environment14.
Coaching
The trainee is placed under a particular supervisor who functions as a coach in training the
individual. The supervisor provides feedback to the trainee on his performance and offers him
some suggestions for improvement. Often the trainee shares some of the duties and
responsibilities of the coach and relieves him of his burden. A limitation of this method of
training is that the trainee may not have the freedom or opportunity to express his own
ideas15.
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Coaching is a one-to-one training. It helps in quickly identifying the weak areas and tries to
focus on employees. It also offers the benefit of transferring theory learning to practice. The
biggest problem is that it perpetrates the existing practices and styles. In India most of the
organizations are trained only through this method16.
Temporary promotions
Training is main factor for improve temporary promotion is the temporary assignment of an
employee to a higher graded position for a specified period of time, with the employee
returning to permanent position upon the expiration of the temporary action. In order for an
employee to be temporarily promoted, he/she must meet the same qualification requirements
that are necessary for a permanent promotion. The temporarily promoted employee receives
the higher graded salary for the period assigned and gains quality experience and time-ingrade at the higher grade level.
Temporary promotions are intended for meeting temporary needs of the agency's work
program when necessary services cannot be provided by other means. Temporary promotions
can be used to:
Off the job training- Off the job training methods are those in which training is provided
away from the actual working condition. It is generally used in case of new employees.
Instances of off the job training methods are workshops, seminars, conferences, etc. Such
method is costly and is effective and large number of employees has to be trained within a
short time period. Off the job training is also called as vestibule training, i.e., the employees
are trained in a separate area (may be a hall, entrance, reception area, etc. known as a
vestibule) where the actual working conditions are duplicated18.
Off-the-job training is conducted in a location specifically designated for training. It may be
near the workplace or away from work, at a special training center or a resort conducting the
training away from the workplace minimize distractions and allows trainees to devote their
453
full attention to the material being taught- However, off-the-job training programs may not
provide as much transfer of training to the actual job as do on-the-job programs.
Many people equate off-the-job training with the lecture method, but in fact a very wide
variety of methods can be used. Employee training at a site away from the actual work
environment and often utilizes lectures, case studies, role playing, simulation, etc. See also on
the job training.
Classroom Lectures: under the off the job methods of training, classroom method or lecture
method is well-known to train white collar or managerial level employees in the organization.
Under this method employees are called to the room like that of classroom to give training by
trainer in the form of lectures. This method is effectively used for the purpose of teaching
administrative aspects or on management subject to make aware of procedures and to give
instructions on particular topic.
Audio-Visual: Providing training by way of using Films, Televisions, Video, and
Presentations etc. This method of training has been using successfully in education
institutions to train their students in subjects to understand and assimilate easily and help
them to remember forever. New companies have come up for providing audio visual material
for students in their concern subjects. In the corporate sector, mainly in customer care centres
employers are giving training to their employees by using audio visuals material to teach how
to receive, talk and behaviour with the customer.
Simulation: the simulation Method of training is most famous and core among all of the job
training methods. In the simulation training method, trainee will be trained on the especially
designed equipment or machine seems to be really used in the field or job. But, those
equipment or machines are specifically designed for training trainees were making them
ready to handle them in the real field or job. This method of planning is mostly used where
very expensive machinery or equipment used for performing Job or to handle that job.
Vestibule Training: Mostly this method of training will be used to train technical staff,
office staff and employees who deal with tools and machines. Employees learn their jobs on
the equipment they will be using, but the training is conducted away from the actual work
floor by bringing equipments or tools to certain place where training is provided, but not
work place. Vestibule training allows employees to get a full feel for doing task without real
world pressures. Additionally, it minimizes the problem of transferring learning to the job.
Vestibule training is provided to employees when new or advanced equipment or tools
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introduced in to the organization to do a particular job by using them. For this purpose such
equipment is brought to a separate place to give demonstration and train how to use and that
handle it by employees safely.
Case Studies: It is a written description of an actual situation in the past in same organisation
or somewhere else and trainees are supposed to analyze and give their conclusions in writing.
This is another excellent method to ensure full and whole hearted participation of employees
and generates good interest among them. Case is later discussed by instructor with all the
pros and cons of each option. It is an ideal method to promote decision-making abilities
within the constraints of limited data.
Role Playing: During a role play, the trainees assume roles and act out situations connected
to the learning concepts. It is good for customer service and training. This method is also
called role-reversal, socio-drama or psycho-drama. Here trainees act out a given role as
they would in a stage play. Two or more trainees are assigned roles in a given situation,
which is explained to the group. There are no written lines to be said and, naturally, no
rehearsals. The role players have to quickly respond to the situation that is ever changing and
to react to it as they would in the real one. It is a method of human interaction which involves
realistic behaviour in an imaginary or hypothetical situation. Role playing primarily involves
employee-employer relationships, hiring, firing, discussing a grievance problem, conducting
a post appraisal interview, disciplining a subordinate, or a salesman making presentation to a
customer.
Programmed Instructions: This involves two essential elements: (a) a step-by-step series of
bits of knowledge, each building upon what has gone before, and (b) a mechanism for
presenting the series and checking on the trainees knowledge. Questions are asked in proper
sequence and indication given promptly whether the answers are correct. This programme
may be carried out with a book, a manual or a teaching machine. It is primarily used for
teaching factual knowledge such as Mathematics, Physics, etc.
Management Games With computerized management games, trainees divide into five- or
six-person groups, each of which competes with the others in a simulated marketplace. Each
group typically must decide, for example.
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Usually, the game itself compresses a two- or three-year period into days, weeks, or months.
As in the real world, each company team usually can't see what decisions (such as to boost
advertising) the other firms have made, although these decisions do affect their own sales.
Management games can be effective. People learn best by being involved, and the games
can gain such involvement. They help trainees develop their problem-solving skills, as well
as to focus attention on planning rather than just putting out fires. The groups also usually
elect their own officers and organize themselves. This can develop leadership skills and foster
cooperation and teamwork19.
Conclusion
Especially Training and Development helps to create work force efficiency and effectiveness
in the organization for achieve desired objectives and sustainable growth of individual and
organization. without human resource no one organization full fill or reach objectives if find
human resource there is question how many of employees properly work in the organization
for long sustainable growth of the organization. Thats why here training and development
play very potential role for employees to develop individual and organizational goals. It
always benefit to employees rather than organization because without employee performance
organization would not reach any of it objective. Training improves the force, initiative and
quality of work of the employees thus assist them to be more committed to achieving the
goals and objectives of the organization and this has the tendency of enhancing effectiveness
among employees within the organization. Training and Development has positive effect on
Organizational Performance.
Training and Development contribute in such a way that employees can enhance their
liveliness. There is a causal relation between training and employee performance. Training
helps organizations in achieving their strategic objectives and gives organizations an
aggressive border. In this context, organizations train and develop their employees to the
fullest advantage in order to enhance their effectiveness and effectiveness. It is not just
sufficient to conduct a training program. Organizations should evaluate whether training &
development programs are effective and producing desired results. Proper evaluation is the
base to effective training. Training evaluation should be a regular system by the fact that
trainees are transient groups. They attend training program to acquire specific skills,
456
knowledge and capabilities for creating work efficiency in the organization. Over time, new
knowledge and skill becomes necessary; again they return to training program.
References
1. Dr.V.Rama Devi And Mr.Nagurvali Shaik (2012) Training & Development a jump
starter for employee performance and organizational effectiveness, irjc international
journal of social science & interdisciplinary research vol.1 issue 7, july 2012, issn 2277
2. Henry Ongori
and
Jennifer
Chishamiso
Nzonzo
(2011)
TRAINING
AND
de
Silva(1997)
Developing
the
Training
role
of
an
employers'
6. By Raja Abdul Ghafoor Khan, Furqan Ahmed Khan, Dr. Muhammad Aslam Khan (2011)
Impact of Training and Development on Organizational Performance, Global Journal of
Management and Business Research, Volume 11 Issue 7 Version 1.0 July 2011, Print
ISSN: 0975-5853.
7. Herman Aguinis and Kurt Kraiger Benefits of Training and Development for Individuals
and Teams, Organizations, and Society
457
TRAINING
&
DEVELOPMENTLesson
No.
1-TRAINING
15. http://www.whatishumanresource.com/on-the-job-methods
16. http://www.yourarticlelibrary.com/employees/training-methods-on-job-training-and-offthe-job-training-methods/5421/
17. http://cpol.army.mil/library/permiss/6320.html
18. http://www.managementstudyguide.com/training-of-employees.htm
19. http://www.whatishumanresource.com/off-the-job-methods
Websites
1. http://www.ddegjust.ac.in/studymaterial/mba/obh-412.pdf
2. http://www.businessballs.com/traindev.htm
3. http://www.explorance.com/blog/2013/11/5-steps-creating-effective-training-programs/
4. http://hrcouncil.ca/hr-toolkit/learning-implementing.cfm
5. http://www.bizmove.com/personnel/m4d.htm
6. http://www.yourerc.com/_CE/pagecontent/Documents/survey/researchstudies/10%20Training%20Development%20Survey.pdf
7. http://www.trainingindustry.com/content-development/articles/training-best-practicesand-organizational-success.aspx
458
Review of Literature
Ogbuji and
in India, second-largest producer of food in the world and spends more than a
quarter of its expenditure on food and related items etc..
Bottlenecks in Indian Food Processing Industry3 Survey 2010, summarises
that potential of Indian Food Processing Industry and the problems that it faces. India
is one of the worlds largest producers as well as consumer of food products, with
the sector playing an important role in contributing to the development of the
economy. Food and food products are the largest consumption category in India,
with a market size of USD 181billion. Domestically, the spending on food and food
products amounts to nearly 21% of the gross domestic product of the country and
constitutes the largest portion of the Indian consumer spending more than a 31%
share of wallet. Going forward, the Indian domestic food market is expected to grow
by nearly 40% of the current market size by 2015, to touch USD 258 billion by 2015.
A study by Mel Hudson, Andi Smart, et al4 tries to evaluate the appropriateness of
strategic performance measurement system development processes for SMEs. This
evaluation resulted in the identification of a process based on its congruency to the
theoretical model, which is used for an empirical investigation. The paper concludes
with a number of recommendations to facilitate the development of appropriate PM
processes for SMEs.
A research by Richard G.P. McMahon5 has made an attempt to bring out the impact
of financial reporting practices upon business growth and performance outcomes
amongst small and medium-sized enterprises engaged in manufacturing in Australia.
The study is able to establish some statistically significant bivariate associations
between the extent and frequency of financial reporting undertaken and certain
measures of SME growth and performance. The study concludes that improved
financial reporting should be realistically viewed as simply part of a broader
competence in financial management which, taken together with other functional
460
capabilities, is likely to lead to more effective and efficient management of SMEs and
significantly improve their prospects
A paper by Jolanda Hessels, Nasser Bouman and Sjoerd Vijfvinkel6 focuses on the
relationship between environmental sustainability and the financial performance of
SMEs in terms of profit development and revenue development. The analysis uses a
unique dataset of 337 Dutch and Chinese firms. The results suggest a significant
positive association between environmental sustainability and firm performance. It
appears that different indicators of environmental sustainability display a distinct
relationship with the two performance measures.
Dr.P.Uma, in her research paper has tried to study the Role of SMEs in Economic
Development of India7 comparing the performance of small and medium enterprises
in the pre-liberalisation and post liberalisation period. The paper concludes that
every industrial and business organization has to take up the responsibility to meet
the challenges posed by globalization. Not only the big business, but even a small
business enterprise in India has to take up the responsibility to meet the standards,
qualities, technological up gradation, skills technical know-how needed in the global
market.
An article SMEs in India: Importance and Contribution by Sudha Venkatesh &
Krishnaveni Muthiah8, makes an attempt to bring out the importance of small and
medium enterprises in India in addition to the services provided by the supporting
agencies promoting the SMEs.
Research Gap:
The above review of literature of research articles have brought out the problems
relating to Indian Food Processing industries, the potential that the country has for
461
the growth and prosperity of the sector, the presence of insignificant relationship
between the working capital policy and the financial performance of the food
processing industries, etc. But the research works carried out in India pertaining to
the topic in working capital management in food processing industries carried out in
Nestle and Britannia have been very rare. The working capital management of the
top two food processing industries was felt necessary in relation to the pre and
during the Industrial policy period 2009-2014. Hence this study is undertaken by the
researcher with the objective of comparing the liquidity position of the select
companies.
Statement of Problem
Though Food Processing is a sunrise industry in India, its contribution to Indias GDP
and Exports is a matter of concern.
new schemes and facilities provided by Union and State Governments to this sector.
The growth rates and other performance indicators are lagging behind than on
expected lines. Against the backdrop of
and the
Objectives:
1. To understand the Industrial Policy Resolution of Government of Karnataka
2009-14
2. To appraise the Liquidity and working capital management of select Food
Processing Industries in India pre and during the New Industrial Policy.
3. To offer suggestions based on the study.
Research Methodology:
It is an Analytical and Descriptive type of research design. It is based on secondary
data i.e financial statements of the food processing units pertaining to the past 10
years drawn 5 years prior to and 5 years during Industrial Policy of 2009-14.
Sources of data
The financial statements revealing the Assets and Liabilities position, liquidity and
profitability of the select companies have been obtained from the respective
companys website through moneycontrol.com for the period 2005 to 2014.
Sampling Design:
Judgemental Sampling has been used while selecting the sample units for the study.
Totally 62 companies have been listed in BSE Sensex under Food Processing
Sector as on December 2015. Out of these, top 2 companies viz., Britannia and
Nestle have been chosen for the study ranked based on their profitability.
Data Analysis:
Liquidity of the select companies under food processing industries is analysed using
Liquidity Ratios and statements of working capital.
Hypotheses:
H0: There is no significant difference in the Liquidity position of the two companies.
Ha: There is a significant difference in the Liquidity position of the two companies.
Analysis of Data:
Nestle
Britannia
Mar
'05
0.66
0.84
Mar
'06
0.67
1.07
Mar
'07
0.66
1.17
Mar
'08
0.66
1.22
Mar
'09
0.6
1.27
Mar
'10
0.62
1.08
Mar
'11
0.55
1.04
Mar
'12
0.54
0.7
Mar
'13
0.65
0.79
Mar
'14
0.53
0.84
The above table shows that both the companies do not have satisfactory current
ratio of 2:1. Both suffer from liquidity problem but the problem is more with Nestle
when compared to Britannia in terms of liquidity. Hence steps should be taken to
464
improve the current assets position. During the industrial policy period also there is
no improvement seen in case of both the companies rather the situation has further
deteriorated.
Though it is not satisfactory, Britannia has highest current ratio during the pre
industrial policy period and has started declining from 2010 onwards.
Table 2: Quick Ratio of Nestle and Britannia from 2005 to 2014.
Nestle
Britannia
Mar
'05
0.28
0.41
Mar
'06
0.31
0.47
Mar
'07
0.23
0.52
Mar
'08
0.29
0.68
Mar
'09
0.24
0.65
Mar
'10
0.27
0.5
Mar
'11
0.27
0.5
Mar
'12
0.22
0.36
Mar
'13
0.39
0.58
Mar
'14
0.25
0.47
The table above reveals that both the companies do not have sufficient quick assets
to pay off current liabilities when compared to the standard ratio of 1:1. Nestle
suffers more from liquidity problem when compared to Britannia. Efforts should be
made by the companies to improve else they may have to face serious liquidity
crisis. It can also be seen that there is no much difference in the liquidity position of
the companies during industrial policy period also.
465
The chart reveals that both the companies liquidity position suffers due to insufficient
liquid assets over the 10 years of study period.
Table 3: Inventory Turnover Ratio of Nestle and Britannia from 2005 to 2014
Nestle
Britannia
Mar
Mar
Mar
Mar
Mar
Mar
Mar
Mar
Mar
Mar
'05
'06
'07
'08
'09
'10
'11
'12
'13
'14
9.87 10.28 8.79 11.39 11.61 12.33 10.49 11.55 12.37 11.67
11.97 9.34 10.31 9.98 14.54 15.08 16.68 13.17 16.94 17.19
The above table shows the number of times inventory is converted into sales.
Higher the ratio, the liquidity position of the company is assumed to be good.
Inventory Turnover Ratio of Britannia is comparatively better than Nestle with the
ratio of 17.19. Britannia has successively increased its sales during the industrial
policy period. This could be attributed to the impetus given by the state governments
to improve the food processing industries.
Chart 3: Inventory Turnover Ratio of Nestle and Britannia from 2005 to 2014
466
The above chart reveals that Inventory Turnover Ratio of Britannia is better
compared to Nestle over the 10 years from 2005 to 2014. The increase in the ratio
is due increased sales of Britannia over the years.
Table 4: Debtors Turnover Ratio of Nestle and Britannia from 2005 to 2014
Nestle
Britannia
Mar
'05
87.32
51.3
Mar
'06
65.35
53.85
Mar
'07
64.09
88.94
Mar
'08
87.37
69.07
Mar
'09
93.68
64.88
Mar
Mar
'10
'11
98.22 84.1
76.42 87.18
Mar
Mar
Mar
'12
'13
'14
82.12 105.92 107.49
90.94 86.89 96.44
The above table shows the Debtors Turnover Ratio of the companies from 2005 to
2014. The ratio represents the number of times the companies have had credit
sales. It shows that the ratio is higher in case of Nestle when compared to Britannia.
Though higher ratio implies good liquidity position, the money is locked up with the
debtors thereby affecting the liquidity position of the company.
Chart 4: Debtors Turnover Ratio of Nestle and Britannia from 2005 to 2014
467
The chart reveals that Nestles funds are locked up in the form of Debtors. Though
the growing ratio indicates better liquidity position for the company, the efforts should
be made to convert the debtors into cash else the firms suffer.
Table 5: Working capital Analysis of Britannia Industries from 2005 to 2014
Rupees in Crores
Working
2014
2013
2012
2011
2010
2009
2008
2007
2006
2005
Capital
Current Assets
486.33 473.09 465.36 397.21 325.94 343.8 391.4 292.08 226.88 194.84
Current
Liabilities
660.98 576.9 882.53 381.29 345.08 290.06 269.66 238.12 239.89 223.03
Working Capital
(CA-CL)
174.65 103.81 417.17 15.92 -19.14 53.74 121.74 53.96 -13.01 -28.19
The table shows that the companys working capital is not satisfactory as there is a
negative value for the years 2014, 2013, 2012, 2006 and 2005.
This negative
There is an
increase in the current liabilities with an increase in the current assets during the
industrial policy period but the companys working capital position has remained
pathetic with negative values.
The above chart reveals that out of the 10 years, the company faces negative
working capital for 6 years. Even during the industrial policy of 2009-2014, with
sufficient support from the government, the working capital position of the company
has remained negative.
Table 6: Working capital Analysis of Nestle India from 2005 to 2014
Current Assets
Current
Liabilities
working capital
(CA-CL)
2014
2013
2012
2011
1,389.02 1,569.56 1,070.11 1,076.67
1,361.00 1,348.76 1,259.51 1,059.75
28.02
220.80
-189.40
16.92
Rupees in Crores
2010
2009
2008
2007
2006
2005
658.69 589.66 493.16 470.46 338.51 287.26
The table shows that the working capital position of Nestle India has slightly
improved over the years.
increased current liabilities for the years 2005 to 2010 and there is an improvement
during the year 2011, but the company picks up from 2013 due to increased current
assets.
469
Except for the years 2013, 2014, 2011, the company has negative working capital
due to higher current liabilities in the rest of the years.
Comparison of Working Capital (CA-CL)
Britannia
Nestle
India
2014
174.65
28.02
2013
2012 2011
103.81 417.17 15.92
220.8
-189.4 16.92
2010
-19.14
184.99
2009
2008
2007
53.74 121.74
76.73 -89.28
53.96
-59.05
Rs. In crores
2006
2005
-13.01
102.31
From the above Table and Chart, it may be inferred that both the companies suffer
from working capital problems. Britannia is slightly better when compared to Nestle
470
-28.19
-94.42
India as its working capital position is improved from the year2013 whereas Nestle
India still has negative working capital.
Major Findings:
India has huge potential for the growth and development of food processing
industries
The industry attracts incentives from both central as well as state government
The Central government introduced several schemes through industry policy
2009-14 for MSME, Large and Mega projects.
The current ratio of both the companies is not satisfactory compared to the
standard ratio of 2:1.
The Quick Ratio of both the companies is also not satisfactory when
compared to the standard ratio of 1:1.
Inventory Turnover Ratio of Britannia is good when compared to Nestle
implying that the company sells more number of times.
Debtors Turnover Ratio of Nestle is greater compared to Britannia and reveals
that the companys funds are tied up in the form of debtors hence affecting its
liquidity position.
The working capital position of Britannia reveals that it is negative for the
years 2014, 2013, 2012, 2006 and 2005 and no much improvement during the
industrial policy period also.
Except for the years 2013, 2014, 2011, Nestle has negative working capital
due to higher current liabilities in the remaining years.
Suggestions:
1. There is no much impact of Industrial Policy on the liquidity position of the
select companies under Food Processing sector.
2. The companies under study should make efforts to improve their liquidity
position.
471
[2]
[3]
[4]
[5]
[6]
[7]
472
[8]
[9]
[10]
[11]
Websites:
www.des.kar.nic.in
www.karnatakaindustry.gov.in
www.google.co.in
473
ANNI ARNAV
RESEARCH SCHOLAR
JAIN UNIVERSITY, BENGALURU.
Abstract
Technology has extremely developed in the area of Human Resource Management
(HRM) with the role of virtual communication and automated processes in most of the HR
processes at workplace. Numerous reasons can be ascribed to the alignment for traditional
HR roles and responsibilities with technology based roles and processes in the HR domain.
Cost -cutting, progression of the existing manual work with automation, global culture,
changing values, virtual communication, HR as a resource and several other factors have
contributed to the gradual changes. It would be very intricate to bring into line the growing
demand for technical growth with diversified roles and responsibilities in HR area for the
Leaders. Performance assessment metrics, HRIS (Human Resource Information Systems), IT
applications on HRM, HR audit, web-based technology and various other aspects of HRM is
making the HR leaders to be additionally proactive in each and every phase of work. The
employees call for the training which meets the global standards through technology based
approach in structuring the learning and also the contentment with the job. The strategic
thinking and proactive forecasting of the HR needs of the organization is one of the great
challenges of HRD (Human Resource Development). This research paper is an attempt to
know the different instructional design methods used for training in IT companies of
Bengaluru. Further, to appraise the existing methods and to discern the Management
reactions to the global changes of technology in HR. We would realize the training
implications with the methods used for training employees in IT companies of Bengaluru.
474
Keywords
Human Resource Information Systems, HR Audit, Human Resource Development,
Instructional Design Methods, & Training Technology.
Introduction
Training design deals with the identification of entire training program. The training
objectives of the training designs are very essential factor in training decisions since it covers
the contents, methodology and extent with the base of training need analysis. Training
designs are an effective way of taking decisions of imparting training to the employees. It
becomes a crucial requirement for the Management to consider in all dimensions of
Employees learning and its role in contributing to the productivity of the organization. A few
surveys conducted previously by the academic researchers opine that one of the vital factors
for attrition in companies is enhanced training opportunities with the new companies where
the employees join. A lot of benefits and perks are given by the companies; at the same time
companies should concentrate on retaining the paramount talents by providing various
training opportunities to widen skills in them. There is a constant effort in making the HR as
an imperative factor in bringing the success for an organization. A lot of research needs to be
conducted to scrutinize the deficiencies in the training sector of IT industry.
Literature Review
Training and Development has a positive effect on Organizational Performance.
Training Design and Delivery style have significant effect on Organizational Performance
and all these have positively affected the Organizational Performance. It means it increases
the overall organizational performance (Khan, Abdul et al, 2011). Since, performance
remains as one the main objectives of any company, much research has been intended for at
explaining and accepting the association among human resources practices and firm
performance. It is affirmed that elucidating organizations performance variations stay one of
the most durable subjects of study (March and Sutton, 1997). A skilled and motivated
workforce can have a very significant task to provide the necessary speed and flexibility to
the organization to expand competitive advantage in a vibrant market environment where
475
Hypothesis
Null Hypothesis: The choice of an instructional design is independent of the
experience of Employer.
Alternate Hypothesis: The choice of an instructional design is dependent on the
experience of the Employer.
Null Hypothesis: The choice of an instructional design is independent of the education
of Employer.
Alternate Hypothesis: The choice of an instructional design is dependent on the
education of the Employer.
Null Hypothesis: The choice of an instructional design is independent of the age of
Employer.
476
Scope
The evaluation of different instructional design methods in the organization shall
definitely facilitate us in analyzing and taking decisions appropriately in the organizational
context and on par with the industry standards. This would help the HR leaders of the
companies to accomplish standardized training programmes and plans pertaining to their
specific requirements. This would also guide to comparison of the very effective design
methods and its applicability for organization.
Objectives
Examine the different instructional design methods of the organizations.
Know the effective instructional design methods in industry.
Evaluate the impact of decisions based on the design methods.
Limitations
This study was limited to randomly selected companies of Bengaluru region only.
Research Methodology
The convenience sampling design has been applied for this study. Questionnaires
were administered personally, through e-mail and telephonic discussions. Core IT Employees
were chosen among different IT companies of Bangalore region. Total of 100 respondents
were chosen with five employees from each company and questionnaires were administered
after pilot testing. This study was conducted through a survey questionnaire with convenience
sampling respondents selected among employees (Management). Further, the sources for
secondary data included government documents and few researches conducted in other
countries and previous researches in India. Data collected were checked for completeness
477
before being analyzed using Statistics tools like Descriptive Statistics, Anova Tests,
Reliability and validity test with Cronbachs alpha. This was supplemented by using SPSS
statistical tool for analysis and illustration.
Mean
Std. Deviation
Statistic
Statistic
Std. Error
Statistic
E-learning Framework
100
3.97
.072
.717
100
3.96
.079
.790
Training
100
3.89
.089
.886
Educational Assessment
100
3.69
.081
.813
Interdisciplinary Teaching
100
3.52
.107
1.068
Educational Technology
100
3.43
.108
1.075
ADDIE Model
100
3.36
.092
.916
Education
100
3.19
.049
.486
Instructional Theory
100
2.75
.113
1.132
Educational Animation
100
2.74
.100
1.001
Experience
100
2.69
.063
.631
Learning Object
100
2.58
.090
.901
Interaction Design
100
2.43
.109
1.094
Storyboard
100
2.27
.062
.617
Mobile Learning
100
1.64
.070
.704
100
The choice towards selecting the instructional design methods are represented above in
decreasing order of preference. The E-learning framework is in the top and the mobile
478
learning is the least preferred instructional design method among the rest. It shows that the
respondents are more inclined towards E-learning framework in the design of training.
Instructional Design Coordinator and Training are subsequently second and third in the
preference list among the respondents which makes us to know that still respondents havent
completely moved towards other design methods.
Table: 02
ANOVA
ADDIE Model
Educational Assessment
Educational Animation
Educational Technology
E-learning Framework
Instuctional Theory
Interaction Design
Learning Object
Mobile Learning
Sum of Squares
df
Mean Square
Sig.
Between Groups
3.234
1.617
1.965
.146
Within Groups
79.806
97
.823
Total
83.040
99
Between Groups
3.369
1.685
2.635
.077
Within Groups
62.021
97
.639
Total
65.390
99
Between Groups
.929
.465
.458
.634
Within Groups
98.311
97
1.014
Total
99.240
99
Between Groups
8.123
4.062
3.703
.028
Within Groups
106.387
97
1.097
Total
114.510
99
Between Groups
.841
.420
.815
.446
Within Groups
50.069
97
.516
Total
50.910
99
Between Groups
.925
.463
.357
.701
Within Groups
125.825
97
1.297
Total
126.750
99
Between Groups
.665
.332
.274
.761
Within Groups
117.845
97
1.215
Total
118.510
99
Between Groups
.491
.245
.298
.743
Within Groups
79.869
97
.823
Total
80.360
99
Between Groups
1.354
.677
1.377
.257
Within Groups
47.686
97
.492
479
Storyboard
Training
Interdisciplinary Teaching
Total
49.040
99
Between Groups
1.662
.831
Within Groups
60.178
97
.620
Total
61.840
99
Between Groups
.023
.011
Within Groups
37.687
97
.389
Total
37.710
99
Between Groups
2.204
1.102
Within Groups
75.586
97
.779
Total
77.790
99
Between Groups
4.338
2.169
Within Groups
108.622
97
1.120
Total
112.960
99
1.340
.267
.029
.971
1.414
.248
1.937
.150
ADDIE Model
Educational Assessment
Educational Animation
Educational Technology
E-learning Framework
Sum of Squares
df
Mean Square
Sig.
Between Groups
2.864
1.432
1.732
.182
Within Groups
80.176
97
.827
Total
83.040
99
Between Groups
.017
.009
.013
.987
Within Groups
65.373
97
.674
Total
65.390
99
Between Groups
.519
.259
.255
.776
Within Groups
98.721
97
1.018
Total
99.240
99
Between Groups
2.987
1.493
1.299
.278
Within Groups
111.523
97
1.150
Total
114.510
99
Between Groups
.794
.397
.769
.466
Within Groups
50.116
97
.517
Total
50.910
99
480
Instuctional Theory
Interaction Design
Learning Object
Mobile Learning
Storyboard
Training
Interdisciplinary Teaching
Between Groups
.621
.310
Within Groups
126.129
97
1.300
Total
126.750
99
Between Groups
3.785
1.893
Within Groups
114.725
97
1.183
Total
118.510
99
Between Groups
1.228
.614
Within Groups
79.132
97
.816
Total
80.360
99
Between Groups
1.596
.798
Within Groups
47.444
97
.489
Total
49.040
99
Between Groups
1.232
.616
Within Groups
60.608
97
.625
Total
61.840
99
Between Groups
3.957
1.978
Within Groups
33.753
97
.348
Total
37.710
99
Between Groups
3.725
1.862
Within Groups
74.065
97
.764
Total
77.790
99
Between Groups
.393
.197
Within Groups
112.567
97
1.160
Total
112.960
99
.239
.788
1.600
.207
.753
.474
1.631
.201
.986
.377
5.685
.005
2.439
.093
.170
.844
ADDIE Model
Educational Assessment
Sum of Squares
df
Mean Square
Sig.
Between Groups
6.447
2.149
2.694
.050
Within Groups
76.593
96
.798
Total
83.040
99
Between Groups
4.433
1.478
2.327
.079
Within Groups
60.957
96
.635
481
Educational Animation
Educational Technology
E-learning Framework
Instuctional Theory
Interaction Design
Learning Object
Mobile Learning
Storyboard
Training
Interdisciplinary Teaching
Total
65.390
99
Between Groups
4.675
1.558
Within Groups
94.565
96
.985
Total
99.240
99
Between Groups
.969
.323
Within Groups
113.541
96
1.183
Total
114.510
99
Between Groups
3.003
1.001
Within Groups
47.907
96
.499
Total
50.910
99
Between Groups
1.900
.633
Within Groups
124.850
96
1.301
Total
126.750
99
Between Groups
2.830
.943
Within Groups
115.680
96
1.205
Total
118.510
99
Between Groups
1.719
.573
Within Groups
78.641
96
.819
Total
80.360
99
Between Groups
1.394
.465
Within Groups
47.646
96
.496
Total
49.040
99
Between Groups
2.666
.889
Within Groups
59.174
96
.616
Total
61.840
99
Between Groups
.763
.254
Within Groups
36.947
96
.385
Total
37.710
99
Between Groups
.354
.118
Within Groups
77.436
96
.807
Total
77.790
99
Between Groups
1.151
.384
Within Groups
111.809
96
1.165
Total
112.960
99
1.582
.199
.273
.845
2.006
.118
.487
.692
.783
.506
.700
.555
.936
.426
1.442
.235
.661
.578
.146
.932
.329
.804
From table 1, it is inferred that the following designs are popular (in order of preference
among Employers).
Preference
Instructional design
E-learning Framework
Training
Educational Assessment
Interdisciplinary Teaching
Educational Technology
ADDIE Model
Education
Recommendations
The training designs have an impact on the behavior and attitude of employees due to
various factors. For the improved job performance, the effective instructional method needs
to follow which is according to the preference of the respondents in the survey. E-learning
framework can be still enhanced since it is the most preferred design for conducting the
training in the IT industry. As a part of strategic thinking and to make Employees to be
strategically knowledgeable to face the uncertainties, the Management should identify the
best instructional design Coordinators to carry on the tasks. These Coordinators can
competently modify the TNA (Training Need Analysis) appropriately with the emerging
methodologies. The current study also helps the Managements of IT industry companies to
retain skilled and efficient workforce with their effective training design methods. Employees
look for interesting and challenging environment to stay and work on building their career
which can be considered as a most effective tool to build up future talents.
Conclusion
Training designs are very essential for the Managers to compete with the competitors
and equip their employees to face the challenges in the industry. It not only focuses on the
competition part but at the same time the different internal and external factors in the process
of organizational success. Better instructional designs can foster greater organizational
stability and less employee turnover and conflicts in this stressful competitive environment.
483
We shouldnt underestimate the rest of training designs, even though; other training designs
are most effective in meeting the purpose of the training requirement.
References
Becker, B., & Huselid, M. (1998). High performance work systems and firm
performance: a synthesis of research and managerial implications, Research in
Personnel and Human Resources Management , 16, 53-101.
Jackson, S. E., Brett, J. F., Sessa, V. I., Cooper, D. M., Julin, J. A., & Peyronnin, K.
(1991). Some differences make a differenceIndividual dissimilarity and group
heterogeneity as correlates of recruitment, promotions, and turnover. Journal of
Applied Psychology, 76, 675689.
Raja Khan , Abdul Ghafoor, Khan, Furqan Ahmed, Dr. Khan, Muhammad Aslam,
(July 2011).
Impact of Training and Development on Organizational Performance, Global Journal
of Management and Business Research Volume 11 Issue 7 Version 1.0, University of
Lahore.
484
Stewart, G. L., & Barrick, M. R. (2000). Team structure and performance: Assessing
the mediating role of intrateam process and the moderating role of task type.
Academy of Management Journal, 43, 135148.
485
PART- B
A STUDY ON BANKS EFFORT ON IMPROVING THE CREDIT HEALTH OF
MSMES WITH REFERENCE TO SELECT PUBLIC AND PRIVATE SECTOR
BANKS IN INDIA
G. VINAYAGAMURTHY,
PH.D RESEARCH SCHOLAR, DEPARTMENT OF COMMERCE, DHANRAJ BAID
JAIN COLLEGE, THORAIPAKKAM, CHENNAI 600 097, TAMIL NADU, INDIA.
S. GANAPATHY,
PH.D RESEARCH SCHOLAR, DEPARTMENT OF CORPORATE
SECRETARYSHIP, DHANRAJ BAID JAIN COLLEGE, THORAIPAKKAM,
CHENNAI 600 097, TAMIL NADU, INDIA.
ABSTRACT
Over the last five decades, Micro, Small and Medium Enterprises (MSMEs) has
emerged as a highly vibrant and fast growing sector of the Indian economy. It plays a crucial
role in providing large employment opportunities in rural, urban and most backward areas.
The Ministry of Micro, Small and Medium Enterprises promotes the development of micro
and small enterprises in the country with the objective of creating self-employment
opportunities. For any organization set-up, finance plays a key role to start-up and run an
enterprise. There are Banks and Financial Institutions are providing loans to MSMEs.
However, despite their importance to the economy, most SMEs are not able to stand up to the
challenges of globalisation, mainly because of difficulties in the area of financing. The
purpose of this study is to focus on how the public and private sector banks provide financial
support to MSMEs.
Key Words: Public Sector Banks, Private Sector Banks, MSME (Micro, Small and
Medium Enterprises), Credit Health, Portfolio, Credit Risk.
INTRODUCTION
The MSME sector plays a significant role in the Indian economy. A catalyst for socioeconomic transformation of the country, the sector is critical in meeting the national
objectives of generating employment, reducing poverty, and discouraging rural-urban
migration. These enterprises help to build a thriving entrepreneurial eco-system, in addition
486
to promoting the use of indigenous technologies. The sector has exhibited consistent growth
over the last few years, but it has done so in a constrained environment often resulting in
inefficient resource utilization. Of the many challenges impeding the growth and
development of MSMEs, inadequate access to financial resources is one of the key
bottlenecks that make these enterprises vulnerable, particularly in periods of economic
downturn. The MSME sector in India is incredibly heterogeneous in terms of size of the
enterprises, variety of products and services produced and levels of technology employed.
Inadequate access to finance and credit represents one of the most critical constraints
to economic development, particularly for rural and self-employed households and for micro,
small and medium enterprises (MSMEs). Much of the population in emerging markets is
employed in the informal sector: many are self-employed as farmers, household-based
entrepreneurs with small retail shops, street vendors, artisanal manufacturers, or other service
providers.
REVIEW OF LITERATURE
David Storey, Kevin keasey, Robert Watson and Pooran Wynarczk (1987)
disclosed that SSI units owned and managed by the entrepreneur himself have bigger
magnitude of problems and challenges. In 87 percent of the units studied, the dependence on
bank finance was high and loans were secured by the companys productive assets. Bank
owners major portion of funds comes from the trade creditors and bank. Banks were found
to be unwilling to lend except as secured creditors to that units having higher capital
investment from the owner.
Patwaradhan (1988) study traced the historical aspects of financial assistance to SSI
sector .The study highlights that reliance on institutional sources increases with growth in the
size of units. The study finds that the SSI is obliged to rely considerably on non-institutional
sources of funds at high rates of interest and they have difficulty in finding out institutional
sources because of inherent weakness. The commercial banks are better placed compared to
other financial institutions to assist the SSI.
Phanasalkar (1999) in the study of successful small manufactures deals with three
blunders in financial management companies: [i] expanding fixed assets without providing
for enough working capital; [ii] speculating on borrowed money; and [iii] doing informal
business. His findings are the debt equity smaller than 3:1 reduced over a period indicates
lower leverage. Each companys financial management is conservative and reliance was more
on their own funds than on commercial banks for the working capital. The absence of low
level of the above three factors can help the bank for identifying the success factor in lending.
487
The study made by Narasimham (1999) identifies the issues to be addressed in the
light of financial sector reforms. he finds that the problems of SSIs sector are not largely or
solely due to inadequacy of credit but arise from structural aspects of sector itself such as
absence of adequate infrastructure, weak technological base, inadequate and poor marketing
and lack of price and qualitative competitiveness. If this structural weakness is corrected
credit would flow to SSI sector on commercially viable consideration. This way, the
enhancement of capital assistance would not only get benefit SSI sector but all the financial
institution and banks.
Nanjundappa (2002) observed that SSIs are vital in driving economic growth and
credit is the lifeline for their survival. SSI should adopt Japanese model of implementing
restructuring package containing technology accreditation and innovation .SSI sector has not
been getting required funds and this problem has multiplied several folds after liberalization
and globalization .The Privatization of public sector banks will further reduce the credit
availability to SSI. The government should not neglect credit needs should be met under a
single window agency.
K G Vinayakpotha (2010) Finance is one of the critical inputs for the promotion and
development of the micro and small enterprises. Finance to the MSEs is part of the Priority
Sector Lending Policy of the banks. For the public and private sector banks, 40% of the net
bank credit (NBC) is earmarked for the Priority Sector. For the foreign banks, however, 32%
of the NBC is earmarked for the Priority Sector, of which 10% is earmarked for the MSE
sector. Any short fall in such lending by the foreign banks has to be deposited in the Small
Enterprise Development Fund (SEDF) to be set up by the Small Industries Development
Bank of India (SIDBI). The SIDBI is the principal financial institution for promotion,
financing and development of the MSE sector. Apart from extending financial assistance to
the sector, it coordinates the functions of institutions engaged in similar activities. SIDBIs
major operations are in the areas of (i) refinance assistance (ii) direct lending and (iii)
development and support services. Commercial banks are important channels of credit
dispensation to the sector and play a pivotal role in financing the working capital
requirements, besides providing term loans (in the form of composite loans). At the State
level, State Financial Corporations (SFCs) and twin-function State Industrial Development
Corporations (SIDCs) are the main sources of long-term finance for the MSE sector.
PROBLEM STATEMENT
Small and Medium Enterprises (SMEs) play a very significant role in the economy in
terms of balanced and sustainable growth, employment generation, development of
488
entrepreneurial skills and contribution to export earnings. However, despite their importance
to the economy, most SMEs are not able to stand up to the challenges of globalisation, mainly
because of difficulties in the area of financing. With the opening up of the Indian economy, it
has become necessary to consider measures for smoothening the flow of credit to this sector.
Thus, an attempt has made to study the banks effort on improving the credit health of
MSMEs with reference to select public and private sector banks in India.
SCOPE OF THE STUDY
The scope of the study covers selected public and private sector banks viz., Indian
Overseas Bank, State Bank of India, HDFC Bank Ltd. and Axis Bank. The selection of banks
is based on the more number of branches in Chennai city.
OBJECTIVES OF THE STUDY
1. To study the contributions made to Micro, Small and Medium Enterprises by select
Public and Private Sector Banks in India.
2. To study the recent initiatives taken by RBI for the upliftment of SME sector.
DATA COLLECTION
The study is based on secondary data and all the relevant information is collected
from various issues of RBI Annual Report, Database on Indian Banking published by Indian
Banking Association, respective banks Annual Report, Journals, etc.
INDIAN OVERSEAS BANK CONTRIBUTIONS TO SME
The Banks share of credit to Micro, Small and Medium Enterprises (MSME) to total
domestic advances has increased from 17.56% to 19.75% during the year 2014-15. Credit to
Micro and Small Enterprises has increased from Rs. 24,575 crores to Rs. 28,036 crores with a
contribution of 88% towards Priority Sector advances. The number of borrowal accounts
under Micro Sector has increased by 13.57% as against the mandatory norms of 10%. Bank
has also extended 17,473 collateral free loans amounting to Rs. 833 crores to MSME under
the CGTMSE scheme.
IOB SME EASY has been launched for the Micro and Small sector to take care of the
main problems of delayed realization of receivables. To address the credit requirement of
MSME in the State of Tamil Nadu, the Bank has signed a MOU with Tamil Nadu Small and
Tiny Industries Association (TANSTIA). The Industries Association is sponsoring
applications of the members seeking credit requirements. The Bank has also signed MOU
with Confederation of Indian Industry (CII) under its Finance Facilitation Centre (FFC),
United Economic Forum besides enlarging the scope of MOU with Bharatiya Yuva Sakthi
Trust (BYST) by covering all categories of entrepreneurs including all SC/ST/Women
489
beneficiaries. The Bank has conducted various road shows for display of its MSME products
in association with CII under FFC, SMERA and various industries associations across the
country. The Chamber of Indian Micro Small and Medium Enterprises (MSME) has awarded
Banking Excellence Award to the Bank for New Initiatives made during 2013-14.
TABLE 1 SHOWING PRIORITY SECTOR-WISE ADVANCES / NPAS OF INDIAN
OVERSEAS BANK FOR THE FINANCIAL YEAR 2014-15
(Rs. in Crores)
Outstanding
S
No
Priority Sectors
% of
Total
Gross
Gross NPAs to
Advances
NPAs (Rs.)
Total Advances
(Rs.)
1
2
in that sector
26284.30
2012.33
7.66
13865.57
1883.04
13.58
Services
11652.97
1263.03
10.84
Personal Loans
12268.88
642.76
5.24
Total
64071.72
5801.06
9.05
Outstanding
S
No
Priority Sectors
% of
Total
Gross
Gross NPAs to
Advances
NPAs (Rs.)
Total Advances
(Rs.)
1
2
in that sector
1,12,752.88
10,216.74
9.06
65,699.72
7,087.13
10.79
Services
26,146.41
1,699.94
6.50
Personal Loans
90,352.32
1,202.51
1.33
Total
2,94,951.33
20,206.32
6.85
Priority Sectors
% of
Total
Gross
Gross NPAs to
Advances
NPAs (Rs.)
Total Advances
(Rs.)
1
2
in that sector
39,244.74
511.52
1.30
18,426.43
280.00
1.52
Services
27,045.25
293.85
1.09
Personal Loans
22,182.38
77.54
0.35
491
Total
106,898.80
1,162.91
1.09
Priority Sectors
% of
Total
Gross
Gross NPAs to
Advances
NPAs (Rs.)
Total Advances
(Rs.)
1
2
in that sector
17,878.06
404.61
2.26
16,726.92
256.30
1.53
Services
12,779.07
78.68
0.62
Personal Loans
22,896.47
108.82
0.48
Total
70,280.52
848.41
1.21
Public Banks have a better access to MSMEs, and take the lead in lending to the
sector, as compared to private and foreign Banks. Public banks have considerable empirical
knowledge of the MSME sector, and with the increased use of core banking technology, they
are able to analyze historical data on MSMEs to develop targeted products and better risk
management techniques.
TABLE 5 SHOWING THE PERFORMANCES IN ACHIEVEMENT OF PRIORITY
SECTOR LENDING TARGETS
(Amount in billion)
Outstanding as on
March 31
2014
2015
Private
Banks
Sector
Foreign Banks
16,190
4,645
907
(39.4)
(43.9)
(35.8)
17,512
5,303
970
(37.3)
(42.8)
(35.9)
Notes: Figures in parenthesis are percentages to Adjusted Net Bank Credit or Credit
Equivalent Amount of Off-Balance Sheet Exposure, whichever is higher in the respective
groups. The data for 2015 are provisional.
Source: RBI Report 2014-15
Reflecting the focus of the Government and the Reserve Bank on enhancing credit
flow to the MSE sector, credit to the sector showed a growth of 13.6 per cent as compared to
the overall bank credit growth of 9.0 per cent during 2014-15.
TABLE 6 SHOWING THE CREDIT FLOW TO MSEs
Year
Number
Accounts (million)
of
Amount
MSE credit as % of
Outstanding
(billion)
Credit
2014
12.6 (12.3)
8,510.9 (23.9)
15.7
2015
13.8 (10.1)
9,664.8 (13.6)
17.8
Notes: The data for 2015 are provisional. Figures in parentheses indicate y-o-y change in
percent.
Source: RBI Report 2014-15
493
494
Regional offices of the Reserve Bank have set up MSME specific divisions to: (i)
collate and analyse data on credit flow and sickness from the region; (ii) monitor banks
efforts towards nursing and rehabilitation of MSME units in the region; (iii) monitor the level
of banking activity in identified and unidentified clusters and initiate steps to enhance
banking activity, wherever required; (iv) organize capacity building activities for bank
functionaries involved in lending to the MSME sector; and (v) conduct research on matters
relating to MSMEs, such as credit issues, availability of banking services in clusters, sickness
and capacity building.
As part of capacity building of MSME divisions in banks and to develop
entrepreneurial sensitivity, the Reserve Banks College of Agricultural Banking (CAB), Pune
has designed training programmes for the MSME division-in-charges and trainers in
commercial banks. CAB, Pune has also developed a syllabus for the regional offices of the
Reserve Bank, which, in turn, will conduct workshops for capacity building for branch
managers of specialised MSME branches in their jurisdictions.
MSME GROWTH IMPACTED BY MULTIPLE CONSTRAINTS
Although the MSME sector has been growing at a faster rate than the overall
industrial sector, MSMEs experience multiple constraints that threaten to derail the sectors
growth trajectory. Some of key hindrances that MSMEs face are highlighted.
Inadequate Market Linkages: Except in the case of cluster-linked and ancillary
MSMEs that have natural linkages with large enterprises, MSMEs tend to have poor market
access. The non-cluster MSMEs are fragmented, and as a result, are unable to organize
themselves in order to reduce procurement cost from large enterprises or streamline the
output supply chain. What is worse, in the absence of adequate market linkages, any demand
disruption in the supply chain can severely impact operations because the enterprise capital of
these businesses tends to be locked in illiquid inventory and receivables.
Lack of Infrastructure: Limited access to infrastructure such as power, water and
roads increases operational costs for MSMEs and makes their businesses uncompetitive.
Inadequate access to support infrastructure discourages these units from adopting newer
technologies, where available. In addition, poor infrastructure forces small and medium
businesses to operate in select geographies, increasing the demand for natural resources in
that region.
Inadequate Finance: MSMEs consider challenges in access to finance as one of the
biggest constraints in growth. A study on the MSME sector also suggests that the multiple
growth constraints (like those mentioned above) can be largely linked to inadequate access to
495
finance. The Report of Working Group on Rehabilitation of Sick MSMEs by RBI also finds
lack of adequate and timely access to working capital finance is one of the key reasons for
sickness in the sector.
Lack of Managerial Competence: Micro and small enterprises in particular largely
comprise first-generation entrepreneurs, who have had a limited structured training on
resource planning, capital management and labor management. As a result, lack of
managerial competence often shows in poor book-keeping and a limited knowledge of formal
financial institutions, which further inhibits the growth of these enterprises.
Obsolete Technology: While industries such as automotive, forging, software
development sector require advanced technologies in operations, the majority of the small
and medium enterprises do not have that kind of technological edge. A low technology base
results in low productivity, which makes these enterprises uncompetitive. Financial
institutions associate lack of technology with uncompetitive businesses and therefore are
wary of financing enterprises which are not technologically up-to-date in operations. These
enterprises too have limited awareness about new technologies, or the technology financing
schemes.
CONCLUSION
Without adequate bank finance, SMEs cannot acquire or absorb new technologies nor
can they expand to compete in global markets or even strike business linkages with larger
firms. Similarly, banks cannot consider the financing of SMEs as a viable option unless their
priorities are addressed by SMEs. In this regard, SMEs should be assisted largely by public
initiatives involving participation of the banking industry. In India, however, the various
public initiatives for promoting finance to SMEs have not been as successful as envisaged
because there has been some overlapping of regional and national initiatives. Efforts to
harmonise the standards and practices, therefore, need to be properly coordinated to facilitate
SME finance further.
REFERENCES
1. David Storey, et.al. The performance of small firms profits, jobs and failures
Croom-Helem, London, 1987, pp.22-24.
2. Patwardhan V.S., Financial Assistant to the Small Industry Sector: An appraisal in
small scale industries in industrial development: the Indian experience; K.B.Suri et.al.
Sage Pub, New Delhi 1988, PP.238-268.
496
497
DR HASEEN TAJ
PROFESSOR AND CHAIRPERSON, DEPARTMENT OF EDUCATION,
BANGALORE UNIVERSITY, BANGALORE
NANDINI N
RESEARCH SCHOLAR, DEPARTMENT OF EDUCATION, BANGALORE
UNIVERSITY, BANGALORE
Abstract
Visually impaired students deserve to be educated in a placement that meets all their
educational needs. Educators of blind and visually impaired children must place educational
integration in its proper perspective and adopt as the overriding goal of the development of
skills that enhance integration in adult society. The mission of teaching students with visual
impairment is to provide all persons involved in the students education with the necessary
resources they need to help each student become successful members of their communities
and to equip those in the vision field with a readily available resources to meet the wide range
of needs of the students they serve. Students who are blind or visually impaired, particularly
those with additional disabilities or those who are younger, require much one-on-one
attention from staff. It is important for adults to find the balance between assisting the student
and creating a learned dependency. Henceforth we should never do anything for the student
that they can do for themselves. It is important for students with visual impairments to
develop good organization skills. Students will not be successful in careers and in life if they
cant locate their possessions or store supplies in an expected manner. This paper throws its
light on tactile teaching-learning process, tactile finger spelling and role of facilitator in
teaching tactile sign language for visually impaired students.......
Key words: Visual impairment, education, tactile sign language, tactile finger spelling,
facilitator.......
Introduction
Vision is a primary sense for learning. Teachers use pictures, photographs, and a
variety of color coded materials in their instruction. They also use demonstrations and
considerable modeling, which requires the students visual attention. Many students with
498
severe and multiple disabilities have considerable difficulty understanding verbal information
and so rely heavily on visual information (Alberto & Frederick, 2000; Hodgdon, 1995;
Hughes, Pitkin, & Lorden, 1998). But what about students who cannot perceive visual cues
or access verbal information? When students have severe and multiple disabilities, teachers
must resort to alternative teaching strategies to provide effective and accessible instruction. If
these students are also blind or have limited vision, however, they need instructional
materials that provide relevant tactile information.A teachers instructional style certainly
influences what a student learns. Teachers engage their students by providing visual and
auditory information. They convey their mood through facial expressions, body language,
and tone of voice. They give directions by gestures, pointing, and spoken words. If students
cannot receive or understand these modes of communication, the teacher must use alternative
strategies. The primary alternatives are tactile. The teacher must convey his or her
instructional expectations, mood, and information through physical and direct contact with
the student.
Purpose of Education
There are so many things that students need to learn throughout their school career.
So, as an educator, we should first think about the purpose of education. Although this
includes fostering development and imparting knowledge, but the fundamental goal of
education is to provide students with knowledge that they can transfer into the real world. In
other words, the real purpose of education is to prepare students for life. It is about the
knowledge we teach children in particular subjects, the formation of social skills, the growth
in thinking and decision-making skills, and in building the capacity to lead a full and
independent life.
The core curriculum is what we expect all children to know by the end of each grade
level throughout their school career. This includes the traditional subjects of reading, writing,
math, science, social studies, physical education, fine arts, etc.
Acquiring Knowledge
Students acquire knowledge differently from one another. This process of learning is
dependent on the formed pattern of reception, sensation, perception and retention which is
unique to every individual. Some students may find it easier to understand processes when
demonstrated, while others may already get it once verbally presented. While some students
survive classes by listening to the professor alone, some may opt to just read their books at
home. These patterns of behavior called learning styles are essential traits that students must
possess to be able to work in school. As we know that students learn in different ways - some
499
by seeing, some by listening, and others by reading. Some even learn more by doing it
themselves. The first thing that a teacher must do is to determine the learning style of his or
her students. To do this, the teacher must identify the sensory systems that work with a
particular student. He or she must further determine the stimulus to which the sensory system
responds. For instance, a child who learns faster by seeing a demonstration is a visual learner.
A child can be classified visual too if he or she prefers reading. It is then necessary to classify
between visual-seeing and visual-reading. On the other hand, a student who listens in class
may be classified as auditory-verbal, while a student who tends to work well while listening
to music may be classified auditory-musical. Lastly, a student who learns by doing a certain
task may be classified as tactile-working, while one who deliberately takes notes and
understands the lessons may be tactile-writing.
12.2.1 Tactile Sign Language
The deaf-blind person puts his or her hands over the signers hands to feel the shape,
movement and location of the signs. Some signs and facial expressions may need to be
modified (for example, signing not understand instead of signing understand and shaking
ones head; spelling dog rather than signing dog). People can use one-handed or twohanded tactile sign language. People who grew up using ASL in the deaf community may
prefer tactile ASL, while others who came from an oral background or learned signs later may
prefer a more English-based tactile system.
12.2.2 Tactile Finger-spelling
Usually blind or visually impaired people who lose their hearing later, or deaf or hard
of hearing people who have depended on their speech reading and do not know how to sign,
prefer tactile finger-spelling because sometimes sign language can be difficult to learn. The
deaf-blind person may prefer to put his or her hand over the finger-spelling hand, or on the
signers palm, or cup his or her hand around the signers hand.
Tactile learning and teaching
When students with severe disabilities are unable to use their vision effectively for
obtaining information, they require tactile information that is accessible to their hands or
other parts of their body. Tactile information, however, has different characteristics from
visual. Unlike vision, touch provides a fragment of the whole; the student must put together a
series of tactile impressions to understand what other students are looking at. Certain
concepts are easier to convey tactilely than others. Abstract concepts are much more difficult
to adapt tactility than more concrete facts. For instance, it is much easier to teach about
500
helium using balloons than it is to teach historical events. The teacher must ensure that the
tactile representation is truly representative of the concept and is relevant and meaningful to
the student. The educational team must decide what aspects of a lesson can be represented
tactilely to make instruction most easily understood. At times, the best tactile representation
may be tangential to the specific subject.
Presenting Tactile Information
You can provide visual (e.g., pictures or sign language) and auditory (e.g., speech)
information to several students at once. These so called distance senses are quick and
efficient. In contrast, tactile information requires individual physical contact and takes more
time to understand. You must allow extra time for presentation of tactile information so the
student has an opportunity to touch, handle, examine, and eventually synthesize and
understand information (Downing & Demchak, 2002).
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object to the student, but encourage them to reach for and obtain the object. This is part of the
student beginning to understand object permanence.
Facilitators should encourage students to
reach for and obtain an object that comes into contact with their body. As stated
before, try to involve the student in the process of locating and obtaining objects. Students
need to understand that objects continue to exist even when they are not in contact. Tap the
toy/object on the tray or floor if it fell on the floor or place the object in touch with the
student's arm or leg.
locate partially or fully hidden objects. Help students explore their area and teach
them that they can locate partially hidden objects. Play fun hide and seek games by partially
hiding the object. If students have difficulty, provide a sound source by the object to help the
student locate it.
find objects after systematic search (use a search pattern to locate an object). Teach
the student to use a pattern to locate materials. For example, starting in the top left hand
corner and working in a zig zag pattern moving to the right and left and up and down until
they locate the object.
retrieve object when placed in their usual location. Students should be oriented to the
explore a variety of objects with both hands. Provide tactually interesting materials to
encourage exploration.
Importance of tactual discrimination finger sensitivity
When preparing for braille literacy, it is important to develop tactual discrimination
skills and finger sensitivity. The development of tactual discrimination skills follows an order
from larger to smaller that is similar to the development of the hands and fingers. It begins
with using the whole hand to explore objects and progresses to using fingers and fingertips to
examine the details of tactile materials. Students with limited sensitivity in their fingers may
not be good candidates for braille reading. There are a variety of diagnosis that can cause
numbness or reduced sensitivity in the fingers. This will be a factor in determining if a
student will be a candidate for formal braille instruction. Henceforth we should encourage the
student to begin to identify, compare and organize objects and toys they are exploring. So we
should talk to the student about different temperatures, weights and textures and encourage
them to locate identical or similar materials. Draw the student's attention to where toys and
materials are located and encourage them to locate the objects and put them away in their
correct place. Encourage students to begin identifying and naming objects. Once they are
503
successfully able to identify objects, begin to transfer this skill to embossed shapes, and then
outlined shapes.
Developing tactual discrimination and finger sensitivity
We can help the development of tactual discrimination and finger sensitivity by
providing many opportunities throughout the day for the student to tactually discriminate
materials and compare similarities and differences, classify, and sort by using real materials
whenever
possible.
Draw the students attention to textures and describe the textures. This will help the student
become aware of their differences. We can help a student develop finger sensitivity and
refine their tactual discrimination skills by providing them with a variety of textures to match,
sort and play with and explore. When selecting toys, choose toys that are tactually
interesting. Throughout the activities, provide the student with the language that connects the
experience.
Conclusion
Meeting the learning needs of students who have severe disabilities and who do not
have clear access to visual information is a significant instructional challenge. Teaching
through touch is unfamiliar and perhaps awkward for most sighted people, but learning
through touch is essential for students who are blind or have minimal vision. Effective use of
tactile strategies must consider the individual students needs and abilities, learning
environment, and task. These strategies can best support students learning when there is a
concerted effort on the part of the educational team, additional time for the presentation of
tactile information, and systematic evaluation of adaptations.
References:
Alberto, P. A., & Frederick, L. D. (2000). Teaching picture reading as an enabling skill.
Teaching Exceptional Children, 33(1), 60-64.
Downing, J. E., & Demchak, M. A. (2002). First steps: Determining individual abilities
and how best to support students. In J. E. Downing (Ed.), Including students with severe
and multiple disabilities in typical classrooms: Practical strategies for teachers (2nd ed.,
pp. 37-70). Baltimore: Paul H. Brookes.
Hughes, C., Pitkin, S. E., & Lorden, S. W. (1998). Assessing preferences and choices of
persons with severe and profound mental retardation. Education and Training in Mental
Retardation and Developmental Disabilities, 33, 299-316.
Miles, B. (1999). Talking the language of the hands to the hands. Monmouth, OR:
DBLINK, The National Information Clearinghouse on Children Who Are Deaf Blind.
(ERIC Document Reproduction Service No. ED 419 331).
Silberman, R. K., Sacks, S. Z., & Wolfe, J. (1998). Instructional strategies for educating
students who have visual impairments with severe disabilities. In S. Z. Sacks & R. K.
Silberman (Eds.), Educating students who have visual impairments with other disabilities
(pp. 101-137). Baltimore: Paul H. Brookes.
Smith, M. (1998). Feeling groovy: Functional tactual skills. Retrieved January 24, 2000,
from http://www.tsbvi.edu/Outreach/ seehear/summer98/groovy.htm
505
DR.HASEENTAJ
PROFESSOR AND CHAIR PERSON,
DEPARTMENT OF EDUCATION, BANGALORE UNIVERSITY, BANGALORE.
KALYANI.K
RESEARCH SCHOLAR
DEPARTMENT OF EDUCATION, BANGALORE UNIVERSITY, BANGALORE
Abstract
Contemporary classrooms are becoming more diverse as an increasing number of students
with disabilities are served in the general education classroom. In this setting, they have
access to the general education curriculum and participate in many of the same
extracurricular activities as their peers. This increased diversity may create a need for
additional support in order to meet the academic needs for students with disabilities and for
those students who are at-risk for school failure. Successful inclusion of students with
disabilities in general education classrooms requires a variety of supports. This article
demonstrates the role that peers can play in supporting each other to bring successful
inclusion.. In diverse classrooms, effective instructional strategy such as Class Wide Peer
Tutoring can become vital to meet the needs of all students. Whole-classroom strategy, ClassWide Peer Tutoring (CWPT) is highlighted as method of supporting inclusive education.
ClassWide Peer Tutoring is an instructional strategy developed to help teachers individualize
instruction, while still providing students with ample opportunity to become actively engaged
during instruction. In CWPT, class members are organized into student tutor pairs. Each
earns points for completing their role competently. Students change roles during the day,
sometimes, performing as the student and sometimes as the tutor. CWPT provides the
opportunity for students to practice and master what they are learning while encouraging
positive social interaction among students which benefits normal and special children in an
inclusive classroom. . Hence this paper throws light on Class-Wide Peer Tutoring, its
506
basiccomponents, role of teacher and strategic process which can act as an effective
strategyto supportsuccess in the inclusive classroom.
Keywords: Class Wide Peer Tutoring, Normalchildren, Children with special needs,
Teachers, Components and Strategies of Class Wide Peer Tutoring.
Class-Wide Peer Tutoring:An Effective Strategy to Support Success in the Inclusive
Classroom
Introduction
Teaching Peers is one of the best ways to develop mastery
-Jeff Atwoo
Inclusive Education denotes that all children irrespective of their strengths and weaknesses
will be part of the mainstream education. The feeling of belongingness among all community
members teachers, students and other functionaries is developed through inclusive
education. Inclusive education is for all, irrespective of any social community, caste, class,
gender and (dis) abilityof the child. Children with special needs who experience difficulties in
learning are often marginalized and moreover excluded from the school system. This is in
spite of the fact that there have been number of attempts to create awareness about inclusion
through many of the major governmental programmes. If children with special needs are
included in an ordinary class, it is the responsibility of the teacher to ensure that all children
have access to the curriculum. To make the curriculum accessible to Children with Special
Needs, teacher can either modify the material or adapt the strategy. Either individualization
of instruction will have to be done or the strategy may have to be adopted so that all children
are taught at their level. There are a number of teaching strategies, which can employ or
choose to teach particular task depends on the teachers discretion, the degree of learning and
characteristics of the learner (Myreddi, Narayanan, Manogna, Sumalini, Arati& Padma,
2007). Several researchers have described methods teachers can use to support students who
are challenged in general education classes (e.g., collaboration) (Fisher & Frey, 2001;
Jitendra, Edwards, Choutka, & Treadway, 2002; King-Sears, 2001). Collaboration between
general and special educators has been noted as a key to providing support for students who
are at-risk for academic failure (Fisher & Frey, 2001; Jitendra, Edwards, Choutka, &
Treadway, 2002; King-Sears, 2001). Teachers are also required to provide accommodations
and modifications on assessments and tests for students with disabilities who require these
services (Fisher & Frey, 2001; Jitendra, et al., 2002; King Sears, 2001). However, when the
curriculum falls short of meeting student needs, or when teachers wish to enrich the
507
curriculum, one of the best possible intervention can be using peer involvement. Peermediated approaches such as cooperative learning (Davidson, 1985; Johnson, Maruyama,
Johnson, Nelson, & Skon, 1981; Newman& Thompson, 1987; & Slavin, 1983; 1989) and
Class Wide Peer Tutoring (Barbette, Miller, Peters, Heron, Cochran, 1991; Cooke, Heron, &
Heward, 1983; Greenwood, Arreaga-Mayer, Utley, Gavin, & Terry, 2001) have been
established through repeated experimentation and replication as empirically sound
instructional practices. Peer tutoring is one of the accepted strongly research-based, and
increasingly popular, teaching technique that has positive impact on both mainstream and
Learning Disabled students. In diverse classrooms, Class Wide Peer Tutoring, an effective
instructional strategy is vital in meeting the needs of all students (Jitendra et al., 2002).
What is ClassWide Peer Tutoring (CWPT)?
ClassWide Peer Tutoring (CWPT) is a comprehensive instructional procedure or teaching
strategy based on reciprocal peer tutoring and group reinforcement wherein an entire
classroom of students is actively engaged in the process of learning and practicing basic
academicskills simultaneously in a systematic and fun way.
The CWPT program can double or triple the amount of practice time that students
typically receive in the basic subject areas as they interact directly with the learning task.
These academic tasks can include, but are not limited to, automatic spelling, rapid solutions
to math facts, reading sight words, fluent reading, learning vocabulary, definitions, and
content facts, as well as completing study guides.
ClassWide Peer Tutoring has been proven effective with students from pre-school age to
high school age levels, and has successfully been used with general, special education,
limited English proficient students, attention deficit disordered students and students at risk
for academic failure, regardless of ability levels.
The primary goal of CWPT is to facilitate students' achievement and mastery of any
classroom content subject matter. It incorporates a stimulus-response, error correction,
tutoring technique and game format that benefit both the tutor and the tutee.
Review of Literature
Studies done in the 1980s showed that Class wide Peer Tutoring helps students learn
better and more quickly. Researchers Debra Whorton and Joseph Delquadri did a
study that looked at reading. They found that students who read only 24 words
correctly were able to read 48 words correctly after their teachers started using Class
wide Peer Tutoring. Joseph Delquadri and other researchers did another important
508
reading study. They found that students with learning disabilities read more quickly
and correctly after their teacher started using Class wide Peer Tutoring.
Joseph Delquadri and a team of researchers also studied whether Class wide Peer
Tutoring helps students in spelling. They found that students who scored the lowest
on weekly spelling tests (getting 8 or more words wrong), started scoring as well as
other students in the class (getting fewer than 3 words wrong) after their teacher
started using Class wide Peer Tutoring.
A study by John Fantuzzo and Lauren Heller found that Class wide Peer Tutoring
helped African American 4thand 5thgrade students in math. Most of the students in this
study came from homes with low incomes.
In one study by Charles Maher, students who did not have Classwide Peer Tutoring
finished only 3 of their 10 assignments. But when their teachers started using
Classwide Peer Tutoring, they finished 8 of their 10 assignments.
In their research, George DuPaul and Patricia Henningson showed that class wide
Peer Tutoring helps students with Attention Deficit Hyperactivity Disorder pay
attention longer and stay in their seats to finish assignments.
Class wide Peer Tutoring is also very helpful for students with behavioural disorders
when the materials used are not too difficultmaterials need to match the students
skill levels. A study by Thomas Scruggs and Lori Richter found that after receiving or
giving tutoring, elementary-age students with behavioural problems did better in
school. They especially improved in reading vocabulary and multiplication facts.
Researchers Judith Presley and Carolyn Hughes used peer tutoring to teach social
skills and anger control to high school students with emotional and behavioural
problems. During the time the students were learning social skills through peer
tutoring, they showed less intense anger in situations that happened during the rest of
the school day.
Catherine Trapani and Maribeth Gettinger also had success with using peer tutoring
to teach social skills to 4ththrough 6thgrade boys with learning disabilities.
The benefits of Classwide Peer Tutoring have been found to last even when a student
moves into a classroom where the teacher is not using Classwide Peer Tutoring. One
group of students participated in Classwide Peer Tutoring during grades 14. Charles
th
Greenwood and a team of researchers found that in 6 grade, two years after they had
stopped peer tutoring, these students were still making more progress on some parts of
509
a basic skills test than students who had not been in classrooms with Classwide Peer
Tutoring.
510
4. Built-in reinforcement occurs when students verbally reinforce one another for good
work during tutoring, when the teacher acknowledges exceptional tutoring
behaviourwith dispensing bonus points during the tutoring sessions, with verbal
praise when recording points, and with classroom intrinsic reinforcement for the
winning team each day. Reinforcement is also displayed when the entire classroom
cheers as they get closer and achieve pre-established classroom totals or point goals.
This feature provides an opportunity for students to feel good about themselves and to
develop and be engaged in more appropriate social skills.
5. High mastery levels can be achieved by every student when the content or subject
matter materials are tailor-made to fit the individual deficit of the responding student.
This is done by providing more challenging work for higher achieving students,
appropriate grade level materials for the average achieving students, and fewer items
of the grade level items for lower achieving students. This component provides a
daily awareness of individual learning progress.
6. Measured outcomes are built right into the CWPT program. There are weekly
outcomes that are evidenced in the pre and post assessments that are given at the very
beginning of every new unit of material to be taught, before any tutoring is done (pre
assessment), and then again at the end of a one or two week tutoring session (post
assessment). Daily outcomes are evidenced in the points earned and the written
documents produced during the tutoring sessions by every student. This component
provides a solid foundation for monitoring learning and overall academic
improvements.
In each pair of students, one performs the role of the tutor(the teacher role) generally
normal children in inclusive classroom by providing the content stimulus (whether it
be a pronounced spelling word, a stated math problem, or a direction for reading a
passage aloud) to the other student. The other studenti.e children with disability (the
tutee) performs the learning student role by responding both orally and in writing.
During this time, the tutor monitors and assesses the correctness of the responses.
511
3. CWPT is based on a basketball game format with the entire classroom being divided
into two equal ability teams who are competing to be the winning team by earning the
most points during the tutoring process.
4. In each tutoring pair, the responding student (the tutee) earns points based on the
correctness of the answers. The tutor awards 2 points for every correct answer and as
soon as the tutee makes an error in a response, the tutor provides the correct answer
for the tutee to model. One point is awarded for every assisted answer the tutee
correctly practices three times in both the oral and written form.
5. Each student performs his/her specific role for a specified amount of time, and at the
end of that time, the students switch roles so that the tutor now becomes the tutee and
vice versa, allowing the same amount of time for the new tutee to earn points and be
more directly involved with the content in the responding role.
6. At the end of the second round of tutoring, the points earned from all members of the
two teams are added together to determine the winning team for the day.
Explain and demonstrate peer tutoring and give your class time to practice tutoring
before they do it for real. Two teachers can pretend to be a tutor and a tutee while the
children watch. Show the class how to get into pairs quickly and quietly. Then pretend
to go through a reading vocabulary or math lesson. Show the children how to begin
the lesson, how to move through the lesson, and how to finish the lesson. Then the
children can practice or role-play with other children in the class just as the teachers
did. Teachers can give feedback to the children while they practice.
Teach children what good tutor and tutee behaviours are before starting Class Wide
Peer Tutoring. Explain how to tell their partners in a respectful way when they are
wrong. Give them tips and demonstrate how not to get angry when another child tells
them that they made a mistake. Research shows that practicing these behaviours will
avoid many problems later.
Teach children how to keep track of their partners right answers or their own. The
tutees will then see that they are getting better over time.
Make sure that children are tutoring with materials that are matched to their abilities.
Materials that are too hard will frustrate them, and they will not be able to learn.
512
Have children tutor with new information as soon as they have learned the old
material. This way they will not get bored.
Give all children opportunities to be the tutor, even in subjects where they have
problems. They will learn from tutoring other students, and they will gain more
confidence in their abilities in that area.
Make Class Wide Peer tutoring fun like a game. Tutors can reward their classmates
with points for giving answers that are right or for making progress. Research shows
that rewarding children consistently helps keep them motivated.
Conclusion
Class wide Peer tutoring allows teachers to accommodate a classroom of diverse learners
including students with learning disabilities. This instructional strategy increases response
opportunities for students, provides additional time for positive feedback, and increases the
amount of time a student is on-task (Maheady, 2001). Regardless of achievement level,
content area, or classroom arrangement, peer tutoring demonstrates effectiveness in
facilitating progress in the general education curriculum (Cohen, Kulik & Kulik, 1982; Cook,
Scruggs, Mastropieri, & Casto, 1985;Johnson, Maruyama, Nelson & Skon, 1981). It can be a
resource for teacher working in inclusive set up to train and give individualized support to
children with special need. They can train Peer Tutors or Buddies to give support to special
child in response there will be a feeling of love and belongingness, Sensitivity for each other
and foremost they learn to help each other in order. It can be concluded that a well-planned
Class wide Peer Tutoring is an effective strategy to teach varied skills to students with and
without Special Needs.
References
1. Barbetta, P. M., Miller, A. D., Peters. M. T., Heron, T. E., & Cochran, L.L. (1991).
Tugmate: A cross-age tutoring program to teach sight vocabulary. Education and
Treatment of Children, 14, 19-37.
2. Cohen, J. (1986). Theoretical considerations of peer tutoring. Psychology in the
Schools, 23(2), 175-186.
3. Cohen, P., Kulik, J., & Kulik, C. (1982). Educational outcomes of tutoring: A metaanalysis of findings. American Educational Research Journal, 19, 237-248.
4. Davidson, N. (1985). Small group learning and teaching in mathematics: A selective
review of the research. In R. E. Slavin, S. Sharan, S. Kagan, R. Hertz-Lazarowitz, C.
513
Webb, & R. Schmuck (Eds.), Learning to cooperate, cooperating to learn. (pp. 211230). New York: Plenum.
5. Delquadri, J., Greenwood, C.R., Carta, J.J.,& Vancenall, R. (1986). Class wide peer
tutoring: Exceptional Children, 52(6), 535-561.
6. DuPaul, G.J., & Henningson, P.N. (1993). Peer tutoring effects on the classroom
performance of children with Attention Deficit Hyperactivity Disorder. School
Psychology Review, 22(1), 134143.
7. Fantuzzo, J.W., King, J.A., & Heller, L.R. (1992). Effects of reciprocal peer tutoring
on mathematics and school adjustment: A component analysis. Journal of Educational
Psychology, 84, 331339.
8. Fisher, D., & Frey, N. (2001). Access to the core curriculum: Ingredients for student
success. Remedial and Special Education, 22, 148 - 157.
9. Greenwood, C. R., Arreaga-Mayer, C, Utley, C. A., Gavin, K. M., & Terry, B. J.
(2001). Class wide peer tutoring learning management system. Remedial and Special
Education, 22, 34-47.
10. Jitendra, A. K., Edwards, L., Choutka, C. M., & Treadway, P. (2002). A collaborative
approach to planning in the content areas for students with learning disabilities:
Access to the general curriculum. Learning Disabilities Research & Practice, 17(4),
251-266.
11. Johnson, M., & Bailey, J. S. (1974). Cross-age tutoring: Fifth graders as arithmetic
tutors for kindergarten children. Journal of Applied Behaviour Analysis, 7, 223232
12. Maheady, L. (2001). Peer-mediated instruction and interventions and students with
mild disabilities. Remedial & Special Education, 22(1), 4-15.
13. Maheady, L., Sacca, M.K., & Harper, G.F. (1988). Class Wide Peer Tutoring with
mildly handicapped high school students. Exceptional Children, 55(1), 52-59.
14. Myreddi, V. (1998). Effect Peer mediated reinforcement and response cost in the
enhancement of learning among the mentally retarded children. Unpublished doctoral
dissertation, Utkal University, Bhuvaneshwar.
15. Welsch, R. G. (1994). Effects of peer tutoring on sight word acquisition and social
interactions, of students with multi-handicaps. Unpublished masters thesis, The Ohio
State University, Columbus.
514
MUNNU PRASAD. V
LECTURER
ST. JOSEPHS PU COLLEGE FOR GIRLS, BANGALORE.
Abstract:
Innovation ecosystem covers two distinct, at largely separated economies, the knowledge
economy it is driven by fundamental research, and another is related to the commercial
economy it is driven by the marketplace. This is majorly concentrated in the economy is
productive process where input number increase or newer way to get extra output from the
same number of input.
The study was based on the innovation ecosystem support,nurturing the culture in ecosystem
and improving the challenging through innovations in existing products (goods/services). It
was also focussed on knowledge and commercial economy changes in their development
strategies as well as the gap in it. The study also concentrated in the knowledge of research
accessibility to the public and its usage towards the commercialisation or in development in
the existing business through innovation.
The study has included both primaryand secondary data. The study has made use of statistical
tools like correlation, percentage and graphs for analysing data. The study of this research
was based on explaining the innovative ecosystem in business economical structure of Indian
enterprises. This study is going to suggest the requirement of bridging a gap between
knowledge and commercialisation and also concentrates how to make use of knowledge for
the existing enterprises.
Key Words: Innovation, Ecosystem,Knowledge, Research, Enterprises.
Introduction:
Innovative ecosystems is described as a
large and diverse collection of
participants
and
resources
that
contribute and it is necessary for
ongoing innovation in a modern
economic. It comprises entrepreneurs,
investors,
researchers,
university
faculty, venture capitalisation as well as
business development and other
technical service providers such as
accountants,
designers,
contract
Innovation
Ecosystem
515
Entrepreneurs
Investors
Talent
Universities
Internet - Last Resort
14
http://masstech.org/innovation-ecosystem
516
The open Innovation looks into research and development, where open innovation looks for
Internal and External Technology. From the Internal and External sources of technology the
idea will give for the innovation in current/new/new firms market (Research Institutions ->
Network Organisation -> Technical Services -> Corporate innovators).
Every Industry/Enterprises/Business units should look for the community of innovation,
where the community will lead for better and strategical innovation for the betterment of the
business economic in innovation ecosystem.
To build a community of
innovationTrust-building
Knowlege
sharing &
exchange
The community of innovation includes the criteria like leadership, incentives, governance and
socialization.
Pipeline of Innovation:
Pipeline of Innovation
The pipeline innovation approach is there from the long period,
we can say it as a traditional system of approach innovation or it
can also be used for re-envisioning the innovation process. From
this approach where research was leading for the innovation and
finally for the business development.
In this approach there was no moreequal participation of
universities, industry and government together, where challenges
of individual faced individually. Slowly the new paradigm shift
in the economy for practicing the university, industry and
government collaboration started. The new paradigm shift
explains how the research facilities centric for the development
of short term and long term helps for the early manufacturing
517
(short term) and for the updating innovation in the research (long term).
Innovation
Innovation Ecosystems Requirements (Internal)
Ecosystem
Requirements
The innovation ecosystem requires
many in internal as well as the
external elements.
Internal:The internal elements like
research and development, market
research, marketing, manufacturing
and finance. The major elements
required a support of finance, where
finance element should go hand-inhand for the other elements. The
Elements of the internal requirements
should be planed like when? How?
518
Both internal and the external plays a role simultaneously in the innovation ecosystem for the
economic conditions for upgrading the technology.
Research Design
I. Statement of the Problem:Innovative ecosystems in business economical structural
of Indian enterprises. This statement is going to check whether the enterprises in
India is approaching the University knowledge for the Data Usage for new/existing
business development through innovations.
2)
3)
519
V. Research Methodology:
a.
Type of Research: -
b. Sampling Design
Non-probability Sampling - Judgemental sampling: It is a sampling
procedure which does not afford any basis for estimating the probability that
each item in the population has been included in the sample. It is also known
as purposive analysis or selective sampling.
Sample Size:
10 Ph.D. scholars in different combinations or subjects and 10 Enterprises in
Urban Bangalore.
c.
Primary Data:The data collected through Personal Interview with both Ph.D.
Scholar and Enterprises.
d.
Sources of Data:
e.
f.
g.
Data Analysis
Percentages and Graphs were used while analysing the data.
VI.
Not all the entrepreneur and the academicians were interviewed due to
short duration of time in the visits and tight schedules of their working.
521
1.
Are you people aware of
innovative ecosystem?
In the field work of personal
interview, the 19 respondents accepted
that they know the concept of
innovative ecosystem, where 1
respondent said no for the concept and
said require to update in knowledge.
No
No
5%
Yes
95%
Yes
60%
Resources
Level of Development
Research Universities
Inventing
Commercializing
Gap/Challenge
New Products Sold by Companies
Suggestions:
523
The ample of chances are there to study of need of innovative ecosystems in the various
industry, the chance for new innovation in the ecosystem in the existing or new business for
the business economic structure of Indian enterprises.
13 BIBLIOGRAPHY
Alex, j. (2010, March 18). Slideshare. Retrieved Oct 22, 2015, from Slideshare:
http://www.slideshare.net/JeffAlex/why-innovation-ecosystems-lecture
Andersen, J. B. (n.d.). Innovation Ecosystem. Retrieved Oct 21, 2015, from Innovation
Management: http://www.innovationmanagement.se/2011/05/16/what-are-innovationecosystems-and-how-to-build-and-use-them/
Islamic Analysis. (n.d.). Retrieved Oct 21, 2015, from Healthy Innovation Ecosystems:
http://muslim-science.com/islam-analysis-24-building-a-healthy-innovationecosystem/
masstech. (n.d.). Retrieved Oct 21, 2015, from Innovation Ecosystem:
http://masstech.org/innovation-ecosystem
Wikipedia. (n.d.). Retrieved Oct 21, 2015, from Innovation_system:
https://en.wikipedia.org/wiki/Innovation_system
524
I Introduction
India is emerging as a economic force to reckon with. The sheer size of consumers in
the market and their spending habits and patterns are drawing investors from around the
world, more so in the retail sector. Moreover, FDI in the retail sector was increased to 51%
in multi brand retail and the limit was taken away completely for single brand retail, foreign
investors can invest up to 100%. As the economy continues to grow at appreciable rate,
nearly 7-8% a year, the retail sector is bound to grow even more rapidly given recent trends.
The size of the retail sector is expected to more than double to $1.3 trillion by 2020.
Raghav Gupta,
principal, Booz & Co, notes that nearly 800,000 people are currently directly employed in
organized retail sector. This already staggering number of people employed in the retail
sector is expected to grow by leaps and bounds to nearly 12 to 14 lacs by 2016 without FDI.
In the face of the FDI policy, the growth in employment is expected to double.
While employment in the organized retail sector is appreciable, the numbers are substantially
higher in the unorganized or traditional retail sector. Indeed, a majority of the retail sector
employment is in the unorganized sector. And, almost 80%, if not all of the employees in the
unorganized retail sector are with minimum qualifications earning low wages. In comparison
the organized retail sector employees are only slightly better off. The majority of them are
largely uneducated, untrained and unmotivated. This lends itself to a host of challenges for
HR managers in the organized retail sector. In this paper, the challenges are systematically
identified and summarized, structured in addition to developing specific responses to these
challenges. Specifically, in this conceptual paper challenges for HR Manager in Retail Sector
are presented along with some strategies to improve productivity and sustain profits in the
long-term.
525
Examine the various internal factors that pose challenge for HR Manager in Retail
Sector,
(ii)
(iii)
(iv)
(v)
The focus herein is on the organized retailing, so as to gain a deeper understanding about the
HRM issues in Retail Sector and offer some preliminary recommendations to address the
challenges.
526
The Retail Industry in India is one of the most dynamic and fast paced industries with several
players entering the market. The Indian Retail Industry is gradually inching its way towards
becoming the next boom industry. Favorable government policies and continued growth will
mean that the future belongs to the most aggressive players. The Indian retail market is
currently estimated at US$ 396 billion. Retail market in India was valued at INR 16.94 tr in
2014 and is expected to grow at a CAGR of 11%. It accounts for 22% of the country's GDP
and is the second largest employer with 35.06 million people. Traditional retail formats are
increasingly being replaced by modern organized retail formats. Due to growing retail space
and changing consumer behavior, retail market in India is poised for strong growth in the
near future.
527
VI Scope of HR in Retailing
Human Resource Management is particularly important in retailing because employees play a
major role in performing critical business functions. Howard Schultz, Chairman & Chief
global Strategist of Starbucks, emphasizes, The relationship we have with our people and
the culture of our company is our most sustainable competitive advantage.
Human Resource Management can be the basis of a sustainable competitive advantage for
three reasons:
The effective management of employees can produce a cost advantage, since, labour
cost accounts for a significant percentage of a retailers total expenses.
Employees can play a major role in differentiating a retailers offerings from its
competitors offerings; by the way of employee activities such as, providing
information & assistance, stock displays and shelves etc.
The potential advantages are difficult for competitors to duplicate. Ex: Nordstrom.
Unskilled employees
Low pay
Reduced motivation
Job dissatisfaction
High turnover
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1. Low Education:- Majority of the population in India resides in rural areas. There is also
a substantial proportion of the population living in urban high density, poor
neighborhoods. These populations collectively, have depressed levels of income and
formal education, their overall socioeconomic status is low. These populations have poor
access to formal or vocational education. Therefore, the retail sector employees start out
with low education, minimal training and poor business etiquette and outlook. This leads
to many of them being unskilled and unprepared to be in the job market.
2. Unskilled Employees: - The organized retailing sector is Human Resource oriented. The
organized sector recruits a large pool of employees. Due to low education levels of
employees, they lack the skills, knowledge and capabilities which are necessary to
perform professionally and at levels needed for the retail businesses to succeed as they
face stiff competition from their counterparts in the organized sector and those operating
at low overheads in the unorganized sector. The organized retail sector is facing a talent
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crisis because neither is the skill levels required present among the pool of employees
available for recruitment nor are there training facilities to prepare them either pre- or
post-employment. Because of low education and low skill levels, employees in the
organized retail sector are paid low wages.
3. Low Pay:- Low remuneration is major issue in the organized retail sector. Due to the
shortage of talent, low levels of skill, the employers in the retail sector hire unskilled
employees in order to meet the demands and pay less. Both the challenges of unskilled
employees and low pay levels are interrelated. Additionally, because unskilled labor pool
is large given the sheer size of the population, i.e., the supply of unskilled labor is high,
employers in the organized sector pay less as that is what the market dictates. Even
unskilled employees need frequent training and development and periodic salary
appraisals and increases.
Therefore, the employees in the organized retail sector work at very low levels of
enthusiasm and motivation.
4. Reduced Motivation :- Decreased or lack of motivation is one of the major problems
among employees of the retail sector. The reasons for reduced motivation is because of
low pay first, and lack of in-house training subsequently, like stress management, time
management, safety measures, handling difficult customers, how to be customer friendly,
handling customer queries, etc., and less opportunity for professional growth. Employees
works with little or no expectations or ambition.
dissatisfaction.
5. Job Dissatisfaction: - Reduced pay and motivation will lead to job dissatisfaction.
Employees do not feel content with their job roles and responsibilities alone. Additional
factors that contribute to job dissatisfaction are:
Poor work
Family problems
6. High Turnover: - There is a high level of attrition in the retail sector, almost 40%,
according to a recent study.
inexperienced and part-time staffs. At lower levels some persistent issues for high
employment turnover with sector are: seasonal employment during peak trading period
and the perceived lack of career opportunities. The other reasons could be:
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Poaching Many emerging and giant players entering the market are offering slightly
better wages and competitive packages to attract the best of employees.
Because of high turnover and unskilled employees, the lack of employees with knowledge of
the store, its layout and products leads to inexperienced employees providing poor customer
service.
7. Reduced Customer Service: - Customer service is the vital feature of the retail sector.
Customer service is one of the most important features next only to prices and product
choices. Good quality and sustained customer service attracts and retains customers, it
builds repeat customer base and enables businesses to capture and retain market share.
The factors listed in the model eventually lead to poor customer service which then leads
to poor sales, loss of customers, poor revenue and depressed profits, and maybe even loss.
VIII Discussion
The model developed and presented herein depicts that the customer service is central to the
success of businesses in the organized retail sector. The formal model of causes and
challenges developed in this paper collectively has a negative impact on customer service.
This in turn leads to poor sales, less revenues and depressed profits and even loss in some
cases. In order to change this compounding negative effect, businesses need to improve
customer service. Businesses in the retail sector have to first directly invest in a variety of
training programs. Programs like product awareness and knowledge, services available with
products, stress management, dealing with difficult customers and so on. Businesses also
need to provide frequent entertainment to employees to keep them energized.
In general, the government has to take steps to provide access to good quality education in
rural areas and for poor populations in urban areas as well. Basic education not a sufficient
condition for success, it is only a necessary condition. Government should also focus on
providing vocational training to employees already in the retail sector or heading to the retail
sector. It is important that businesses in the retail sector also partner with the government in
providing vocational and job-specific training not just in their facilities but elsewhere as part
of their CSR program.
531
The retail giants can even take a further step to come up with their own training institutes,
where prospective employees are trained for a stipulated periods and are sent back
periodically to be retrained. The focus should be on to improve overall customer service like
selling skills, handling tough customers, handling customer queries, behavioral skills, and
safety measures.
The HR managers can plan for in-house training of the employees by providing them with
videos that are easily understood and can be watched on employees own time. A test can be
later administered to make sure employees are watching and understanding the training
videos. Most importantly, we recommend peer-training wherein employees on the floor train
their coworkers. Some of the high performing employees who have good relationships with
most workers can be trained to train the trainees. This strategy is important because low- or
semi-skilled workers are more likely to listen to their peers rather than HR experts and/or
trainers.
Another important area where a HR manager should focus is career advancement and
development training. Businesses can send its promising employees for career advancement
training and set up a reward system which acts as a motivating factor for the employees to be
committed with the organization.
IX Conclusion
FDI in retail sector has progressively increased reaching new highs in terms of rate as well as
size of investments. As a result, the retail sector is the second largest source of employment
in India.
At the same time, the retail sector workers are by and large unorganized,
Despite these recent developments in the retail sector and the nature and challenges of the
workforce, very little formal research has been done in this general area to address the
challenges in the retail sector. Herein, we systematically identify, summarize and give a
conceptual structure to the challenges as well as develop specific responses to these
challenges.
With the aid of challenges, a conceptual model has been developed, which depicts the
relationship between the challenges faced by HR managers in the retail sector. At the first,
the low education levels of the retail sector workers contribute to low skilled/semi-skilled
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workforce which leads to their inability to secure their job on a permanent basis or a living
wage. The low wages leads to low motivation which in turn contributes to job dissatisfaction
and leads to higher attrition rates. All these challenges add up to reduced profits, loss of
customers, reduced sales, and loss of market share.
The HR managers in retail sector are recommended to invest in in-house training of these
low- or semi-skilled workers by peers wherein the trainer trains the trainee to train his/her
peers. Additionally, HR managers in retail sector need to look at adopting technology to train
the workers. HR managers need to also think of providing career advancement and
development training without fear of losing their employees; long-term benefits outweigh
short-term losses.
educational opportunities, in general, and vocational training in the retail sector, in particular.
Also, HR managers should keep looking for private-public partnership potentials to improve
the quality of the workforce in the retail sector.
The challenges pointed out above are inadequate and the causes would be many more, hence
the further research has a lot of scope to focus on other various external and internal
challenges and their causes, as these are not the only challenges faced by the HR Manager
and the challenges are never-ending. The further research can also take into account the
unorganized sector. The researchers can also think about various training methods to
motivate the employees and focus on usage of technology. This not only reduces cost and
time invested in training substantially, but also adds to flexibility and workers training
repeatedly to perfect their interpersonal and customer service-related skills.
X References:
533
http://www.asa.in/pdf/surveys_reports/Retail-Industry-in-India.pdf
http://big-consultants.com/wp-content/uploads/2012/04/Indian-Retail-Industry.pdf
http://articles.timesofindia.indiatimes.com/2012-06-25/news/32408603_1_retailsector-retail-industry-global-retail-development-index
http://www.iimahd.ernet.in/assets/snippets/workingpaperpdf/11660245032012-1204.pdf
http://zenithresearch.org.in/images/stories/pdf/2012/May/ZIJMR/22_ZIJMR_Vol2_Is
sue5_May%202012.pdf
http://www.shrmindia.org/hr-buzz/blogs/shrm-india/role-scope-and-challenges-hrretail
http://www.ehow.com/facts_5720648_role-human-resource-managers.html
http://www.younghrmanager.com/roles-and-functions-of-the-human-resourcedepartment
http://humanresources.about.com/od/hrbasicsfaq/a/hr_role.htm
ASA & Associates. A Brief Report on Retail Sector in India, August 2012
534
Abstract
Over the past decade there has been a new focus on environmental responsibility. A business
that increases energy efficiency, minimizes wasted resources, and streamlines the supply
chain management will successfully improve their financial rewards. A green business
practice can also improve employee engagement by generating enthusiasm and increase
loyalty to the company. Going green informs customers and stakeholders that the companys
bottom line can improve, and could lead to brand loyalty among the customers and
stakeholders.
However, beyond regulation and compliance, environmental and social initiatives should be
viewed as the ethical practice of business. Whether driven by cost savings or a principled
strategy, the industry needs to embrace the environment, their human capital as a valuable
resource to be protected. Long-term business sustainability will depend on this.
There have been a large number of research studies globally, across wide range of industries
indicating the benefits of the concept of sustainability and green initiatives, which leads to
increase in profits and Company management that takes on such green initiatives is also seen
in a favorable light by the employees. Such initiatives boost the public image of the company
and thereby also improve the morale of the workforce and bring them together.
This paper attempts to analyze the green management concept, initiatives and measures taken
and also discuses environmental aspects of incorporating green practices into the business
management.
successfully improve their financial rewards. A green business practice can also improve
employee engagement by generating enthusiasm and increase loyalty to the company. Going
green informs customers and stakeholders that the companys bottom line can improve, and
could lead to brand loyalty among the customers and stakeholders.
According to Wiki database, sustainable business, or green business, is an enterprise that has
a minimal negative impact on the global or local environment, community, society, or
economy. The business is described as green if it, incorporates the principles of sustainability
into each of its business decisions, and supplies environmentally friendly products and
services.
Green Management is also looked as an initiative aiming at continuously improving the
foundation of environmental management, such as the development of personnel responsible
for environmental activities, environmental management systems, and environmental
communication as well as conservation of biodiversity
The Beginning
Governments from around the globe, representatives from international agencies and nongovernmental organizations joined together in the United Nations Conference on
Environment and Development (UNCED), held in Rio de Janeiro in June 1992, with the
objective of preparing the world for attaining the long-term goals of sustainable development.
The conference adopted global consensus and political commitment at the highest level on
socio-economic development and environmental cooperation.
Government of India also took lot of measures towards environmental protection and
sustainability. Regulations and statutes were enacted to protect the environment and control
pollution. International standard Organization has come out with ISO 14000 series standard
for Environment Management System. Many business houses have adopted these standards
on environment, implemented green technologies, so that Socio-Economic Development can
be brought about along with environmental concern.
Green way of business management, contributes to the economic and social environment.
Today organizations are going paperless or sending electronic correspondence in lieu of
paper, which again is the adoption of green management practices. Green management has
become the new branding strategy for establishing a reputation through actions that are not
only environmental friendly but also preserving the environment. It is a win- win situation
where businesses can grow and give back to the society.
Why Green Management?
536
This question is addressed by looking into the business management perspective, Green
management views the concept of Triple Bottom Line (TBL) consisting of the environmental
benefits, positive economics effect, and healthy social images. The triple bottom line of
people, planet and profit, captures an expanded spectrum of values, and criteria for measuring
organizational and societal success.
The triple bottom line is made up of "social, economic and environmental" factors. People,
planet and profit" was coined by John Elkington in 1995 describes the triple bottom lines
and the goal of sustainability. Sustainable reporting is, a way in which organizations assess
their own environmental accomplishments and short comings, reflect on performance and
subsequently transfer this information into the public domain.
The first element of triple bottom line is people. A triple bottom line enterprise seeks to
benefit many constituencies and not exploit. A TBL business would, discourage child labor
and monitor cases of child labor abuse. It strives to maintain a safe work environment and
will not exploit its labor force. Not otherwise exploit a community or its labor force. A TBL
business also typically seeks to "give back" by contributing to the strength and growth of its
community with such things as health care and education.
The second element of triple bottom enterprise is planet. The organization should practice
sustainable environmental practices and benefit the natural order as much as possible or at the
least do no harm and minimize environmental impact.
A Triple bottom line activities reduces its ecological foot print-carefully manage its
consumption of energy and non-renewable and reducing manufacturing waste as well as
rendering waste less toxic before disposing of it in a safe and legal manner. A triple bottom
line company does not produce harmful or destructive products such as weapons, toxic
chemicals or batteries containing dangerous heavy metals. Ecologically destructive practices,
such as overfishing or other endangering depletions of resources are avoided by TBL
companies
The third element is Profit which is the economic value created by the organization after
deducting the cost of all inputs, including the cost of the capital tied up. It is the real
economic impact the organization has on its economic environment
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The Factories Act -1948 and Amendment in 1987 was the first to express concern for the
working environment of the workers. The amendment of 1987 has sharpened its
environmental focus and expanded its application to hazardous processes
International Measures
Enormous economic and population growth worldwide has aggravated the factors that
threaten health and the world ozone depletion, climate change, loss in bio diversity and
depletion of natural resources. In the past, the standard approaches to environmental
problems generated by business and industry have been regulatory-driven, "end-of-the-pipe"
remediation efforts. One critical milestone was the establishment of the ISO 14000 standards
whose development came as a result of the Rio Submit on the Environment held in 1992.
ISO 14000 is a family of standards related to environmental management that exists to help
organizations (a) minimize how their operations (processes etc.) negatively affect the
environment (i.e. cause adverse changes to air, water, or land); (b) comply with applicable
laws, regulations, and other environmentally oriented requirements, and (c) continually
improve in the above.
The Kyoto Protocol to the United Nations Frame Work Convention on Climate Change
(UNFCCC) is an international treaty, with the goal of preventing "dangerous" anthropogenic
(i.e., human-induced) interference of the climate system, sets binding obligations on
industrialized countries to reduce emissions of Greenhouse Gases. Many developed countries
have agreed to legally binding limitations/reductions in their emissions of greenhouse.
The Leadership in Energy and Environmental Design standards [LEED] was developed by
the US Green Building Council in an effort to propel green building design in the United
States. LEED certification is very prestigious title and can be attained through "compliance
with all environmental laws and regulations, occupancy scenarios, building permanence and
pre-rating completion, site boundaries and area-to-site ratios, and obligatory five-year sharing
of whole building energy and water use data from the start of occupancy (for new
construction) or date of certification (for existing buildings)".
Green Business Management-Corporate Examples
Bank of America is proving that eco-friendly operations can coexist with business growth.
According to their corporate web site, the company reduced paper use by 32% from 20002005, despite a 24% growth in their customer base! Bank of America also runs an internal
recycling program that recycles 30,000 tons of paper each year, good for saving roughly
200,000 trees for each year of the programs operation. As if that werent enough, the
company also offers employees a $3,000 cash back reward for buying hybrid vehicles.
540
Starbucks has green advocates smiling about its bean-to-cup approach, which stresses top
efficiency at each link of its global supply chain. By all measures the program appears to be a
great success, with the companys decision to use coffee cup sleeves made of recycled paper
saving roughly 78,000 trees per year since 2006. Starbucks has also partnered with many
environmental organizations, from conservation, International to the Earth watch Institute, in
efforts to do right by the communities it operates in.
According to sustainablog, Wal-Mart has launched an ambitious long term plan to eventually
power each and every one its stores using 100% renewable energy sources. According to the
companys executives, Wal-Mart is committed to using its waste-eliminating corporate
philosophy to make its own operations more eco-friendly than ever.
Coca-Cola has narrowed down 3 environmental goals on which to focus their efforts: water
stewardship, sustainable packaging, and climate & energy protection. Coca-Cola has been
involved in community recycling programs and a complete, sustainability-focused overhaul
of its packaging designs.
Toyota is famous for offering the Prius, the worlds first mass-market hybrid vehicle. The
popular car is now sold in over 40 countries The Environmental Protection Agency has
recognized Toyotas efforts, the Prius and its 48MPG as the most fuel-efficient car available
for purchase in the U.S.
Continental Airlines has spent over $16 billion in the last decade to replace its entire fleet of
airplanes with more fuel-efficient ones, in addition to installing fuel-saving winglets that
cut emissions 5% on its 737 model aircraft. Beyond that, nitrogen oxide emissions from
Continentals busy Houston hub have been sliced by an astounding 75% since the year 2000.
Continental might also be the only company with 12 full time staff environmentalists on
the payroll who are constantly pairing up with engine manufacturers to design greener, more
efficient processes into company operations. And is if this werent enough, the company
makes a point of sorting all of its trash to see what can be recycled.
Indian Companies
Infosys-HSEMS (health, safety, environmental management systems) .Infosys incorporates
the philosophy and commitment towards environmental protection and management of
health, and safety of its employees, contractors and visitors. The following practices are
adopted:
1. Awreness and engagement
Infosys encourages their employees to get actively involved in initiatives that works towards
improvement of environment and society .several employee driven eco-groups have been
541
3. Infrastructure development
Infosys has been awarded the LEED platinum rating, the highest standard for green buildings
by the Indian green building council (IGBC). Buildings have been registered for LEED
rating.
4. Water management
Infosys has reduced its employee per capita fresh water consumption in their Indian
campuses by 6.80%,during 2010-11,through various water conservation initiatives, they have
built rain water harvesting reservoirs at Mysore, Hyderabad, Pune and Mangalore campuses,
with a combined capacity of over 300 million liters. They have also built waste water
treatment plants to regulate and reuse the waste water generated in their campuses for
flushing, landscaping and air conditioning requirements
6. Waste management
Organic waste generated at their campuses is recycled through biogas plants, generated
biogas in turn is used in food courts and final treated waste is used as manure for gardens.
Effective waste management has been achieved by ensuring environmental methods of
disposal as per regulations.
ONGC
ONGC,has well defined energy policy which focuses on various aspects of environmental
friendly energy efficient technologies ,which has resulted in an estimated saving of 409.23
crores during 2011-12. ONGC received greenies eco award for green initiatives and
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considered as one of the best companies, practicing best policies for environment protection
amongst PSUs.
WIPRO
WIPRO limited, leading player in global IT and R&D technologies is committed towards
environmental sustainability by minimizing the usage of hazardous substances and chemicals,
which impacts ecology. Due to these measures,25% of improvement was achieved in energy
efficiency over last 6 years, due to adoption of green building standards based on LEED
frame work. Further, 32% of the water requirements are met by water recycling and
harvesting. Biogas plants are used for converting waste to cooking fuel which results in a net
reduction of 100 tons per annum.
Conclusion:
A survey of consumers in seventeen countries across five continents by market research firm
TXN found that 94% of Thai respondents and 83% of Brazilian were willing to pay more for
environmental friendliness .Perhaps the motivating factors for green business management
are primarily business-based, including cutting operating costs, enhancing employee health
and productivity. While going green can prove a critical source of competitive advantage, its
easier said than done. To achieve real financial benefits, companies, need to follow certain
key practices and they must commit to a green philosophy and incorporate environmentally
sustainable practices into their product lifecycle and supply chain operations. Green
management is not repackaging or reinventing approaches to business management, it is not a
concept with new business management style; green management is an approach towards
rethinking, being more mindful of how organizations are operating, with an environmental
angle, taking into account the triple bottom line, people, planet and profit..
Bibliography
1. Becker T. (2008). "The Business behind Green, Eliminating fear, uncertainty, and
doubt. APICS magazine. vol. 18, no. 2.
2. Ben Tran (2009)Green Management: the reality of being green in business Journal
of economics, finance and administrative science.December2009 Vol. 14 N 27.
3. Boiral, O. (2007). "Corporate Greening Through ISO 14001: A Rational Myth?
Organization Science 18: 127. doi:10.1287/orsc.1060.0224
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4. Brown, D., J. Dillard and R.S. Marshall. (2006) "Triple Bottom Line: A business
metaphor for a social construct." Portland State University, School of Business
Administration.
5. Dr.R.soundararajan, Prof Purandaran, Prof Bharathraj Shetty (2013),Green initiatives
and Sustainability trends.ABBS, conference paper.
Websites:
https://www.globalreporting.org/information/about-gri/what-is-GRI/Pages/default.aspx
http://www.toshiba.co.jp/env/en/management/
http://www.businesspundit.com/25-big-companies-that-are-going-green/
http://green.hotelscombined.com/Gyh-The-Business-Case-For-Sustainability.php
https://www.unglobalcompact.org/docs/news_events/8.1/UNGC_Accenture_CEO_Study_20
10.pdf
List of case studies:
http://www.coolcalifornia.org/small-business/business-case-studies
http://www.earthday.org/campaign/greeneconomy?gclid=CMOUm9yOtskCFRIfaAodvYEMyQ
http://www.green.va.gov/environment/
https://www.google.co.in/search?q=some+corporate+examples+of+green+business+manage
ment&ie=utf-8&oe=utf-8&gws_rd
http://www.academia.edu/7450488/A_study_on_selected_10_indian_corporates_initiative_to
wards_a_green_world
544
Abstract:
The implications behind bringing about rural women empowerment through inclusive growth
is a serious topic being debated across the globe. In India Rural population comprises nearly
70 % of the total population needs inclusive agenda reorientation .The basis of inclusive
growth are indicators to a nations positive progress & they also reflect strategies towards
women empowerment. Enhancing educational opportunities for women is the primary need
which the policy makers have to spotlight while formulating strategies towards inclusive
growth. This paper examines the problems of rural inclusiveness & strategies to revamp
women empowerment programs with way for inclusive growth. The present paper also focus
on role of government in promoting rural inclusiveness
Introduction:
The role of women has become more strategic because post liberalization period in
India has witnessed heavy structural changes in rural socio economic scenario. these days due
to easy communication system rural areas have become easy targets of Multinational
companies & rural men are migrating on a larger note towards cities. (Report on the farm
sector 2012) .The census report of 2011 says that the total number of people involved in
agriculture has increased 12% from 234.1 million in 2001 to 263 .1 million in 2011. (Report
On The Census Of India 2011).
545
Objectives of study
1. To analyze the issues relating to rural inclusiveness
2. To focus on strategies to revamp women empowerment programs for inclusive growth
3. To focus on role of government in promoting rural inclusiveness
Methodology
This paper has been prepared through studies relating to government publications &
official reports. the official websites information of the government department have also
been used.
The Indicators
The studies carried out so far in the field of agriculture indicate that despite the key
role of women in crop husbandry, animal husbandry, fisheries, forestry and post-harvest
technology, those in charge of formulating packages of technologies, services and public
policies for rural areas have often tended to neglect the productive role of women. (Report on
the farm sector - Government Of India Publication, Ministry of Home Affairs
2011).Consequently, the developments of technologies, specifically tailored to women
specific occupations and the involvement of women in technology development and transfer
have received inadequate attention from both scientific and administrative Departments of
Government. (Report On Gender Resource Center 2012).
546
2. Increase in wage labor -nearly 98 million Indian women have agricultural jobs but
around 63% of them or 61.6 million women are agricultural laborers who work for wages less
than their male counterparts ( Report On The Census Of India 2011)
3. Increase in Population- the census report of 2011 says that the total number of people
involved in agriculture has increased 12% from 234.1 million in 2001 to 263 .1 million in
2011.while Indias share in gross domestic product has declined from 22% to 14% over the
same period( Report On The Census Of India 2011).
4. Women in Agricultural Jobs- the number of women with agricultural jobs has come
down from 39% to 7% the overall population of the women increased 18% from 2001 496.5
million to 587.4 million in 2011(Report On The Census Of India 2011 ) Despite significant
contribution of women in the production process, an all pervasive bias of development
planners in treating them primarily as consumers of social services rather than producers,
kept them away from the development programmes in agriculture and allied sectors. (Report
On The Census Of India 2011). As men and women have different roles and needs and face
gender-specific constraints, women may not automatically benefit from development
activities, but may remain excluded. (Report on Gender Resource Center 2012).
Monitoring Agencies
The following agencies can be induced to assist each other towards empowering women
1. Government -local / state / central organizations
2. Nonprofit NGOs
3. Private organizations
4. Private public partnership agencies
5. Field workers -Ad hoc / permanent
6. Trainers including master trainers & transitory trainers
7. Teachers
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2. Priority funding for rural youth empowerment programs -An integrated approach in
funding rural youth empowerment programs is needed .Collective strategies to reflect rural
characteristics are needed.
3. Role of SHGs- SHGs can help rural empowerment through conducting annual community
gatherings & creating awareness about women empowerment & gender equity through SHGs
is needed.
4. Role of case studies- Enhancing case studies can help the policy framers to address issues
relating to women. The case studies help to create awareness about women empowerment &
gender equity. The Studies towards sharing personal experiences & group experiences go a
long way in making women understand the issue related to empowerment.
5. Extending outreach programs- Enhancing leadership training & capacity building for
women can be a handy tool in inclusive growth of women. This enhances the leadership
qualities among women. Fostering debate among community members through personal
experience sharing.
6. Establishing research partnerships Establishing research partnerships towards building an
inclusive local community focusing on women empowerment is needed. As indicated by the
planning commission research partnerships can go a long way in empowerment process
(Report of the Planning Commission of India on Urbanization 2014).
548
Conclusion:
Women issues can be best addressed by the strategies towards establishing rural inclusive
growth should be seriously attended. Rural women population comprising nearly half of the
total rural population needs reorientation through various capacity building activities. As
inclusive growth with gender equity are indicators to a nations constructive progress, strong
strategies towards inclusive growth can support its positive growth. Providing an institutional
accountability mechanism creating awareness & starting a national dialogue is very much
necessary to achieve inclusive growth. Hence strategies towards building an inclusive rural
community are needed & the need for an integrated approach towards building an inclusive
rural community can be best supported through governmental mechanism.
References
1. Ministry of Social Justice & Empowerment 2014 Official Website
2. Report of the working of SHGs in India 2013
3. Report of the ministry of Women & child welfare. New Delhi 2012
4. Report on Gender Resource Center 2014
5. Report on the farm sector - Government Of India Publication ,Ministry Of Home Affairs
2014
6. Report on the farm sector 2014
7. Report on The Census of India 2011
8. The Report of The Planning Commission of India on Urbanization 2011
549
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NEW GREEN MARKETING INITIATIVES FOR SUSTAINABILITY IN THE INDIAN CONCRETE INDUSTRY
- A COMPARATIVE STUDY BETWEEN SMC AND RMC WITH REFERENCE TO THE USE OF GREEN
BUILDING MATERIALS IN CONCRETE.
L.R. MANJUNATHA,
L.R.MANJUNATHA PHD RESEARCH SCHOLAR, R& D CENTRE BHARATIYAR UNIVERSITY INDIA &
AGM-JSW CEMENT LIMITED.
DR.SANDHYA.R.ANVEKAR
PROFESSOR, VTU, BANGALORE, INDIA.
ABSTRACT:
The construction sector in India which is one of the fastest growing sector ,provides essential
services like housing and infrastructure, also reflects reliability, assurance, low-cost
production and market competitiveness. The massive expansion in the construction activities
during the last two and a half decades after Indias economic liberalization in 1991, the future
outlays in the sector both by the government and private entities, has put an enormous
pressure on the quality of construction. There is an increased demand for Ready-Mixed
Concrete(RMC), special green concretes like HSC, HPC, SCC, SDC, temperature controlled
concretes, light weight concretes, coloured concretes, polished concrete and stamped
concrete. Blended concretes (with Fly ash and GGBS) and pervious concretes which are
green and sustainable concrete products in great demand. All these products have to be
marketed and delivered to the customers jobsites with superior quality , speed ,with safety
for execution and timely delivery which requires creating product awareness, importing
knowledge and importance of using these eco friendly products which call for planning and
development of green marketing initiatives in the Indian concrete and construction industry.
Ready Mixed Concrete as a product is continuously evolving and moving forward by replacing
traditional Site Mixed Concrete (SMC). RMC Companies in Bangalore are also providing value
addition to the construction industry by offering new generation special Green concrete products
through continuous innovation, research and product development. Leading commercial RMC
Companies in Bangalore have introduced many innovative newer branded green concrete products
to the markets to cash on the growing need and demand for these products and services and there
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is need to study the market potential, product awareness and customer preference and acceptance
for these products in the Bangalore construction industry.
This pilot market study empherical research paper aims to bring out the customer preference on
smc vs rmc and recent developments and availability of new RMC special green products in the
market using greener industrial by products like Flyash and GGBS as partial replacements to OPC
Cement which is not so eco friendly . The benefits and the value additions of these products to the
end consumers is also highlighted with focus on the growth potential for these products in future.
Key Words: SMC, RMC, High Strength Concrete, Flyash, GGBS, High performance Concrete, Self
compacting Concrete, Fiber Reinforced Concrete, Site Mixed Concrete.
1. INTRODUCTION:
1.1 GREEN MARKETING
Green marketing is the marketing of products that are presumed to be environmentally preferable
to the consumers. Thus green marketing incorporates a broad range of activities, including product
modification, changes to the production process, sustainable packaging, as well as modifying
advertising. Thus the sole aim of green marketing is to the promotion or advertising of products
with environmental characteristics, Recyclable, Refillable, Ozone Friendly, and Environmentally
Friendly.
Green marketing involves developing and promoting products and services that satisfy customers
want and need for Quality, Performance, Affordable Pricing and Convenience without having a
detrimental input on the environment
Green marketing methods seek to go above and beyond traditional marketing by promoting
environmental core values in the hope that consumers will associate these values with their
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company or brand. Engaging in these sustainable activities can lead to creating a new product line
that caters to a new target market.
1.2 EVOLUTION OF GREEN MARKETING
The term Green Marketing came into prominence in the late 1980s and early 1990. The green
marketing has evolved over a period of time. According to Peattie (2001), the evolution of green
marketing has three phases. First phase was termed as "Ecological" green marketing, and during this
period all marketing activities were concerned to help environment problems and provide remedies
for environmental problems. Second phase was "Environmental" green marketing and the focus
shifted on clean technology that involved designing of innovative new products, which take care of
pollution and waste issues. Third phase was "Sustainable" green marketing. It came into prominence
in the late 1990s and early 2000.
As resources are limited and human wants are unlimited, it is important for the marketers to
utilize the resources efficiently without waste as well as to achieve the organization's objective.So
green marketing is inevitable.There is growing interest among the consumers all over the world
regarding protection of environment. Worldwide evidence indicates people are concerned about the
environment and are changing their behavior. As a result of this, green marketing has emerged
which speaks for growing market for sustainable and socially responsible products and services.
1.4 NEED FOR GREEN MARKETING IN THE CONCRETE AND CONSTRUCTION INDUSTRY.
As worldwide awareness and concern over increased carbon emissions and its direct impact over
global climate change increases, there is intense pressure over all industries to reduce their
emissions. The backbone of the construction industry is concrete, which is widely regarded as a high
energy material. Some of the proposed alternatives are Blended Concretes that utilize industrial
wastes such as fly ash and ground granulated blast furnace slag (GGBS)
Concrete is widely considered as the backbone of the construction industry, with a current
consumption of 1 cubic meter per person per year (Gartner E, 2009). Ordinary Portland cement
(OPC) has been used for around 200 years now as a binder material. However OPC has high
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embodied energy of 4.2MJ/kg (Peng J et al, 2014; Huang Li C et al, 2011; Huntzinger DN et al, 2009).
The contribution of OPC is approximately 57% of global man made CO2 emissions (Huntzinger DN et
al, 2009; Meyer C et al, 2009). High CO2 emissions arising from OPC manufacturing are from
calcination of limestone, and high energy consumption during manufacturing (Gartner E et al, 2009).
During the recent past many alternatives to OPC concrete have been proposed to reduce green
house gas emissions which are Blended Cement Concretes, comprising OPC that has been partly
substituted by supplementary cementitious materials, as binders for concrete. Commonly used
substitutes include fly ash, a fine waste residue that is collected from the emissions liberated by coal
burning power stations, and ground granulated blast furnace slag(GGBS), a waste by-product from
steelmaking. According to Flower and Sanjayan use of blended cements results in reduction of CO2
emissions by 1322%. These estimates vary according to the local conditions at the source of raw
materials, binder quantity and amount of OPC replacement, type of manufacturing facilities, climate,
energy sources, and transportation distances.
2. LITERATURE REVIEW
2.1 Concretes and types of Concretes
It is a mixture of portland cement / cement and secondary cementitious materials (PFA.GGBS,
Microsilica,etc), water, aggregates, and admixtures.The cement and water form a paste that
hardens and bonds the aggregates together.Concrete is often looked upon as man made rock.
Site Mixed Concrete (SMC):
Site mixed concrete is the concrete prepared manually at site using the raw materials like cement,
water, sand and aggregates.
Ready Mixed Concrete (RMC)
Ready mixed Concrete is the type of concrete that is manufactured in a factory or batching
plant, according to a set recipe, and delivered to a work site by truck mounted transit mixers.
2.2.
Ready
Mix
Concrete
Industry
in
India
The Ready mix concrete business in India is in its infancy but it is having a steady growth in the last 2
decades. For example, 70% of cement produced in a developed country like Japan is used by Ready
Mix concrete business there. In Europe and USA it is about 60%. Here in India, Ready Mix concrete
business used around just 2 % in the beginning of the 90S and presently the commercial RMC is at
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10 % of total cement production with another 10% estimated to come from project based captive
RMC plants totally taking the mechanized RMC Production to 20 % of the cement production in India
and there is still a lot to catch up in terms of growth and convertion of Site mix Concrete to Ready
mixed
concrete.(Manjunatha
L.R.
,etc
2013,)
2.3Advantages of Readymixed Concrete (RMC) Vis a-Vis Site mixed concrete (SMC).
In India, concrete has traditionally been produced on site with the primitive equipments and use of
large labour force. Ready mixed concrete is an advanced technology, involving a high degree of
mechanization and automation. A typical RMC plant consists of silos and bins for the storage of
cement and aggregates respectively, weigh batchers for proportioning different ingredients of
concrete, high efficiency mixer for thorough mixing of ingredients, and a computerized system
controlling the entire production process. The quality of the resulting concrete is much superior to
site-mixed concrete
Technologically speaking, ready mixed concrete (RMC), which is a building material of paramount
importance, is certainly advancement over the age-old site mixed concrete. The benefits of RMC in
terms of quality, speed, life-cycle cost and environmental friendliness are overwhelmingly superior
to those of site mixed concrete.(Suresh Rao, etc 2013)
An added advantage of RMC is quantity of cement can be reduced in Ready Mixed Concrete by
replacing a portion of cement by supplementary cementitious materials like Ground granulated
blast furnace slag(GGBS), Flyash, Microsilica with are Industrial by products which otherwise would
have been solid waste products and cause environmental Issues.
Ready Mixed Concrete has higher durability as there is better process control and monitoring of
raw materials.
fumes, GGBS reduces perviousness in concrete making it more durable ,sustainable and a green
product.
Fig.1
Traditional site mixed Fig.2 A modern eco friendly RMC plant with advanced
concrete under usage in India- the manufacturing process and technology for producing
most primitive methods of quality ready-mixed concretes
concreting
When companies come up with new innovations like eco friendly products, they can access new
markets, enhance their market shares, and increase profits. Marketing mix of green marketing
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consists of 4ps. They are buttressed by three additional Ps, namely people, planet and profits.(
Heena Dua,2013)
PRODUCT:
The concrete products have to be developed depending on the needs of the concrete
customers who prefer environment friendly building products. Products can be made from
recycled or industrial materials.( Heena Dua, October,2013) Efficient concrete products not
only save resources, energy and money, but also reduce harmful effects on the environment
like co2 emissions. The concrete marketer's role in product management includes providing
concrete manufacturing companies and technical managers and concrete technologists with
market-driven trends and customer requests for greener concrete product attributes such as
energy saving, lesser emissions of co2, local sourcing of raw materials, etc., For example, The
concrete products have to have the right features like good quality in terms of workability
(Slump, cohesiveness and pumpability) during the delivery stages and give good 7 days and
28 days compressive strengths as per requirement of Indian standard (IS 456 -2000) after
the placement. Apart from the above the Concrete has to have desirable durability,
impermeability properties which is generally difficult to achieve by using manually made Site
mixed concrete (SMC). RMC Concete emphasize that it has reduced wastage and used
environment-friendly materials like Flyash and GGBS.
PRICE:
Green pricing in concrete industry takes into consideration the people, planet and profit in a
way that takes care of the health of employees and communities and ensures efficient
productivity. Value can be added to it by changing its performance, functionality and
through customized special concrete products. The price must be right for the customer
when RMC is being sold in place of SMC. Customers will need to buy in large quantity of
RMC to construct their buildings or projects.
RMC Prices are a little over 15-20% costlier than SMC due to the Local VAT Taxes, and newly
imposed excise duty and transportation and pumping costs, but the good product features
and advantages of RMC vis a-vis SMC should make the target customers to choose RMC
instead of SMC
PLACE.
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Green place is about managing logistics to cut down on transportation emissions in the
concrete and construction industry, thereby in effect aiming at reducing the carbon
footprint.
The RMC Products must be in the right place at the right time. Making sure that the Ready
mixed Concrete arrives when and where it is wanted by the customer.
Hence RMC as a product is generally available in cities and not in rural part of India in
comparision with SMC which can be produced anywhere and everywhere manually with the
availability of raw materials.
PROMOTION:
Green promotion in construction industry involves configuring the tools of promotion, such as
advertising, marketing materials, signage, white papers, web sites, videos and presentations by
keeping people, planet and profits in mind.
The target customer group needs to be made aware of the existence and availability of the RMC
products which are green and sustainable through promotion and advertising once they start their
operation in a city/region. Successful promotion helps an RMC manufacturing company to spread
costs over a larger output.
Promotional activites in RMC business include, Product Launch programs,Technical awarness
programs to Architects,Engineers,Contactors and customers on the Advantages of using RMC vis-vis SMC through Demos and presentations.
Plant visits to customers are organized by the RMC Companies to show the customers that the RMC
concrete they get is superior quality , durability and sustainability in comparison with SMC by the
use of mineral additives like GGBS and Flyash which are industrial by products and sustainable
materials
3. SCOPE FOR RESEARCH
3.1. RESEARCH GAP
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The Bangalore and the Indian Readymix concrete Industry is totally an unorganized sector .The First
Commercial RMC plant in south India was started at Bangalore some where in the year 1995 at
white field,. Since then the industry has gradually grown all over Bangalore city and southern Indian
cities. There has been the use of green products like Flyash GGBS and M-Sand for making the RMC
products more durable , sustainable and eco friendly and many consumers of RMC are not aware of
the new developments in concretes like special eco friendly concretes and concepts.
Since 1995 there is not much work has been done to estimate the approximate number
of RMC plants in Bengaluru and southern India being operated and how much
approximate volumes are being produced in Bangalore and in India .
Awareness and scope for green marketing of industrial by products and green
materials like PPC,PSC ,Fly ash ,GGBS and M-Sand and customer awareness and
knowledge about these green products etc
What are the innovations and newer green concrete products available in the RMC
markets and their scope.
The availability and usage of secondary cementitious materials (SCMS) like Flyash,
GGBS ,etc to make the RMC Concrete products more sustainable and durable and the
scope for green marketing.
Suppliers
This
research work will analyze the above GAPs and brings out the possible
solutions.
The research design is the plan or model for the conduct of formal investigation. It is the overall
559
operational pattern on framework of the project that stipulates what information to be collected,
from which source and by what procedure
3.3 STATEMENT OF THE PROBLEM
Traditionally concrete is always made at construction sites(SMC) using manual methods and now a
days RMC is being used predominantly in the city of Bangalore as many Readymix Concrete plants
have come up. Apart from the above the captive batching plants are set up at major project sites to
cater to the huge requirements for mega projects which demand timely completion and there is
usage of industrial by products like Flyash and GGBS in the production of concrete at RMC plants
and there is not much awareness about the benefits of using RMC as well as the sustainable green
products like flyash and GGBS among the construction industry fraternity in Bangalore and hence
this research work has been taken up for study on Green marketing in construction industry A
comparative study of Site mixed concrete and Ready mixed concrete in the city of Bengaluru,
India, with reference to the use of green building materials like Flyash and GGBS
3.4 .OBJECTIVES OF THE STUDY
Main objectives
The research objectives are derived from the gaps in the literature review. The research questions
are some of the key aspects for which the answers need to be sought.
1.To study the factors which influence green marketing in the construction industry with reference
to the use of green eco friendly materials like PPC,PSC, Fly ash, GGBS and M-Sand in the production
of concrete.
2.To study the impact of quality, service and cost economics of Ready mixed concrete(RMC) vis--vis
Site mixed concrete (SMC) with the use of green products in concrete production.
3. To formulate strategies and plans to the Indian building materials and concrete Industry for
popularizing and marketing of more green concrete products for the future.
Sub Objectives:
1. To study the Bengaluru and other cities construction industry customers preferences on the
products RMC vis--vis SMC.
560
2. To study the consumers perceptions on quality, service , brand and cost of the RMC they are
getting from the RMC Companies at Bengaluru.
3. To study the consumers awareness and knowledge on the use of industrial by products like
flyash/GGBS which are green and sustainable in Concrete productions as replacement of opc
cement.
4. To study the different types of special concretes which are sustainable which are being marketed
at Bangalore and other southern cities.
5. To study and estimate the green marketing potential for products like GGBS and Flyash for use in
concrete production in Bangalore city and other towns
6. To suggest appropriate marketing and advertising tools for RMC Companies and green products
manufacturing companies in Bangalore and other cities to maximize the use of sustainable
products like PSC,PPC,GGBS, Fly Ash and M-Sand for durability and sustainability in constructions.
The above research design called for decisions on data sources, research approaches,
research instruments, questionnaire , sampling plan and contact methods.
4. RESEARCH QUESTIONS:
Research Questions
Data Source
What are the factors which influence green marketing in the construction Primary Data
Industry with the use of green products in concrete making
What are the major business implications of green marketing in the Primary Data
construction Industry with the use of green products like Flyash , GGBS
and Manufactured Sand in concrete production between RMC vis--vis
SMC with respect to quality, service and cost
What are the hindrances for popularizing and increasing the use of green Primary Data
products in concrete production in the Indian construction Industry
5. IDENTIFICATION OF VARIABLES
Factors that motivate construction industry stake holders to specify and use green
building products in concrete production.
561
The impact of use of green materials in concrete making with respect to quality,
service and cost effectiveness.
Factors that influence the successful adaptation, marketing and use of green
building products for marking concrete in the construction Industry.
6. RESEARCH HYPOTHESIS
A comprehensive literature review and the scheduling study which was conducted with the,
Architects, consultants and Govt agencies who specify and B2B customers like Developers,
Builders, contractors
For the research problem the following hypotheses are assumed and tested.
562
H02-There is no significant difference between the mean value of quality of the concrete as a
parameter between site mixed concrete (SMC) and Ready mixed concrete (RMC) as
perceived by Architects ,consultants /( Specifiers /Decision makers/Reference group)
H03-There is no significant difference between the mean value of the quality of concrete as a
parameter between site mixed concrete (SMC) and Ready mixed concrete (RMC) as
perceived by B2B Customers.
H04-There is no significant difference between the mean value for service levels while
making of the concrete as a parameter between site mixed concrete (SMC)and Ready mixed
concrete(RMC)
as
perceived
by
Architects
,consultants
and
Govt
agencies.(Specifiers/Reference group)
H05-There is no significant difference between the mean value for service levels while
making of the concrete as a parameter between site mixed concrete (SMC)and Ready mixed
concrete(RMC) as perceived by B2B Customers.
H06-There is no significant difference between the mean value of cost of the concrete as a
parameter between site mixed concrete (SMC) and Ready mixed concrete (RMC) as
perceived by the.(Specifiers/Reference group)
H08-There is no significant difference between the mean value for product awareness and
knowledge of green building materials (PPC,PSC, Flyash, ggbs, M-Sand) in concrete for
sustainability in concrete construction as perceived between (Specifiers/Reference group)
and B2B Customers.
6. Related to acceptance and recommendation for use Green products in concrete and
construction.
H09- There is no significant difference between the mean value for recommendation ,
acceptance and use of green building materials (PPC,PSC, Flyash, ggbs, M-Sand) in
concrete
for
sustainability
in
concrete
construction
as
perceived
between
7. Related to buying criteria for use of Green products in concrete and construction.
H10- There is no significant difference between the mean value for buying criteria and use of
green building materials (PPC,PSC, Flyash, ggbs, M-Sand,) in
products in
H11- There is no significant difference between the mean value for forecasting the growth
potential for use of green building materials (PPC,PSC, Fly ash, GGBS, M-Sand,) in RMC
and
between
9. Related to willing to pay premium prices for use of Green products in concrete and
construction for the future.
564
H12- There is no significant difference between the mean value for paying premium prices
for use of green building materials (PPC,PSC, Fly ash, GGBS, M-Sand,) in RMC and
concrete
for
sustainability
in
concrete
construction
as
perceived
between
The factors are identified from various existing literatures and above research design calls
for decisions on data sources, research approaches, research instruments, sampling plan and
contact methods, questionnaire
7. RESEARCH DESIGN.
The study of green marketing in the construction industry is fairly new topic with very little
available literature. Hence the research design consisted of clearly two stages.
A formal study involving statistical tools and procedures to test the hypothesis.
The exploratory study was conducted with the following objectives in mind.
To estimate the size of RMC Industry in India and number of RMC Plants and
cities of establishment.
In this research work the exploratory study is qualitative in nature and was executed by:
Secondary data involved extensive literature review which includes articles and publications
in the national and international journals related to the study topic. Additionally the Indian
565
construction industry magazines and journals like, ICI Journal, ICJ Journal, Master builders
Magazine, Built expressions ,EPC Magazine, Indian cement review, Civil Engineering and
Construction review, news paper articles, Annual Reports of RMC and cement companies,
reports of Cement manufacturers Association, Ready mixed concrete manufacturers
Association(RMCMA),NRMCMA-USA ,trade journals became source of information which
helped to frame and crystallize the research questions.
Experience and open surveys which were designed to seek out important information on the
presence of RMC plants, their current quality and service levels and their geographical
locations. The participants in the exploratory survey were the top executives from RMC,
Cement, Admixture, construction, architects and consultants companies and the sample size
was about 140 from different cities mainly Bengaluru and in south India .The data collection
was done through individual structured interviews.
The study helped to understand the various aspects of RMC Production and usage like
quality, service and cost effectiveness and the usage of various green building materials
like Portland puzzolana cement, Port land slag cement, Fly Ash, GGBS and M-Sand in
the production of concrete both at RMC Plants as well as at construction sites while
making Site-mixed concretes.
According to them the factors influencing the use of green products in concrete making
was mainly to reduce the cost of concrete production coupled with making the concrete
production in India more durable and eco friendly .
Clarity on the
benefits
constructions and specifications and approvals from consultants ,Govt and architects to
use these products while making and production of concrete and construction at jobsites
are some of the things which will influence the use of more and more green eco friendly
raw materials in constructions.
Descriptive study:
The primary objective of the descriptive or formal study here is to test the hypothesis and
answer the posed research questions. The second objective is to establish a correlation
566
among various variables that are responsible for need for thrust to promote green
marketing in the construction industry especially in the RMC Industry.
The primary data is collected with the help of a specifically designed questionnaire. The
questionnaire is designed to gather more information on factors influencing the need for
green marketing initiatives in the concrete industry and the respondents awareness and
knowledge about the currently used green products in the concrete industry.
Section 4 of the questionnaire has variables which rate the respondents awareness and
usage experience of various green products used in both RMC and SMC.
Section 5 of the questionnaire has variables which will be used to estimate the buying criteria
or behavior of reference group in comparison with the B2B Customers.
Section 6 of the questionnaire has questions and variables which are used to take the opinion
and feed back of the respondents on the growth potential of green cements and concrete
products in future.
567
Primary data was gathered through the use of sampling survey. For the above research
data is collected through sample survey using the designed questionnaire.
The questionnaire instrument is intended to be a tool for the study of green marketing in
the construction industry and the use of green building materials in SMC and RMC with
the objective of under standing the factors that influence the use of green products in the
construction industry. Additionally it aims at gathering information about
a. The reference group and B2B Customer rating of SMC and RMC in terms of quality,
service and costing
b. The awareness and product knowledge about the green building materials.
c. The buying behavior of the reference group and the B2B Customer.
For this study, the existing components from the literature and the components
suggested
by
the
scheduling
research
by
the
industry
experts
were
The questionnaire is designed as per Likert scale measurement scales for most of the
variables in which the respondents specifiy a level of agreement and disagreement with
statements expressing either a favourable or an un
research concept under study. The data scale has got order but no magnitiude and is
categorical data. The non parametric tests will be used for hypothesis testing.
Also the questionnaire has balanced scale measurements for the products and services like
SMC/RMC/ and green products measurements like PPC/PSC/Fly ash/GGBS and M-sand
that have the same number of positive and negative categories to find out the purchase
intend and the product awareness.
568
The reason to adopt the balanced scale approach with a four point scale (Excellent/
good/average/poor) is to find out wide range of opinions as we do not have past research
or preliminary study to find out most opinions are positive and hence data in this research
study is to find out the exact opinions and purchase intent of the respondents on green
products.
(Source: Carl MCc Daniel,Jr and Roger Gates,Marketing research, 8 th edition,Wiley
India Edition,Chapter 11,Attitude measurement pp 354)
Engineers,Builders
Association
of
India
and
attending
various
The sample would consist of consultant and Architect firms, construction companies,
builders and developers .The respondents will be architects, consultants, Govt officials,
civil engineers and professionals from the construction Industry.
consulting engineers, Govt officers (Reference group) and B2B Customers like
contractors/builders and end users mainly in Bangalore and different main cities across
India. The data base was acquired from the ACCE(I),Association of consulting Engineers
(India),Indian concrete Institute(ICI),Builders association of India(BAI),Architects
Association and attending various seminars and conferences at New Delhi, Bengaluru,
Chennai, Hyderabad, Nagpur etc.
representation in the survey depends upon the self interest of the person and upon the
permission granted by the company to get included in the survey.
Stratified random sampling was adopted to conduct the market survey by using well
designed questionnaire on off line format , Personal Interview.
Precision desired
+-5
Central tendency
Population Dispersion
Selective
Sample size is computed as: The appropriate sample size for a population based survey is
determined by three factors:
n= t 2xp(1-p)
________
m2
570
N=270
The questionnaire was administered to 1000 consulting engineers and B2Bcustomers and
the response received was about 140.Thus the over all samples size considered for this
study is 140 numbers.
Pilot study:
In this stage the pilot study of the entire questionnaire was conducted with a samples size
of 140 comprising of consulting engineers and b2b customer and the samples were
selected purely on convenience
The first aim of the pilot test was to ensure that the mechanics of questionnaire response
and compilation were adequate. This was accomplished by having the respondents
complete the questionnaire and comment on the length. wording, instructions and
complexity of the questionnaire.
The second aim is to establish the reliability of the scales. This was achieved by
conducting a Cronbachs alpha where the reliabilities for this study were set around 0.7
and 0.8 range. During this analysis, the variances of the items and the scales were
inspected and the change in Cronbachs alpha when an item would be deleted from the
scale was noted. The table below illustrates the alpha values for the set of data.
Variables relating to factors which influence the use of green materials in construction
and the factors of quality, service and cost parameters for rating the products between
SMC and RMC.
571
Sample
Cronbachs
size
Alpha
0.863
No. of items
Out come
14
of
and
quality,
cost
Consumers
buying
behavior
The alpha coefficient for the four items is .780, suggesting that the items have relatively high internal
consistency.
The alpha coefficient for the four items is .737, suggesting that the items have relatively high internal
consistency.
The following can be drawn with respect to the result of the pilot study. The instrument that was
designed to collect data to prove the hypotheses fulfils the reliability requirements. Additionally
based on the feedback of the respondents the instrument has proven to be adequate of:
Clarity of questions
Flow
Ease of answering
Language
572
Constructs
A univarate analyses of the responses indicate that the hypothesis can be tested with the
questionnaire.
The co efficient of reliability Chronbach alpha is > 0.7 indicating consistency of responses.
The scale of measurement for the data collected is nominal in nature, and hence non
parametric. Random sampling method was used for data collection.
The groups are independent, that is presence of members in one group is not dependent
upon members in another. the statistical tools that were used are
One sample test to understand the factors which influence the use of green
products in construction.
K-Samples tests to evaluate the variables for the two groups (Reference group and
the B2B Consumers)
573
The study does not have certain limitations which are enumerated as follows :
Time span : The research considers the growth of concrete industry and RMC Industry in
India since 1992 ,since the first commercial RMC plant was established in pune in the
year 1992.
Gaps in Data :In India there is no proper data base which records the growth of RMC
Industry citywise,plantwise and state wise due to unorganized sector.The compilation was
done through secondary data from journals,news papers,articles ,personal visits and
interviews with RMC Industry peoples.
8. Conclusions
This survey has revealed that most consumers of concrete have accepted RMC as an
alternative to SMC
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The increased usage of green substitute materials like Flyash, GGBS has made RMC a
sustainable alternative to SMC.
Based on IS codes cement can be replaced by fly ash up to 35% and GGBS up to 70%. For
making the green blended concretes in India
Majority of the people are not aware of sustainable green concretes but the sustainable
concrete recipe is made by adding 15-60% of the supplements like flyash and GGBS based on
the grade of concrete.
There is an increased interest to use green concrete products made out of supplements like
flyash/ggbs in cocnrete in future and there is very good scope and growth for making green
concrete products and green marketing in India.
The research made has given a new dimension to green marketing of building products to the Ready
mix concrete industry and construction sector in the Bengaluru city, India as a emerging market and
also to Ready mix concrete manufacturing companies,Readymix concrete buyers (B2B Customers)
and there by to the civil engineering and construction industry field on the aspects of RMC as better
replacement product vis-a-vis Site mix concrete (SMC) in terms of quality, service, durability
environmental friendliness ,faster work and customer satisfaction.
Green marketing is based on the premise that businesses have a responsibility to satisfy human
needs and desires while preserving the integrity of the natural environment. Green marketing
should not be considered as just one more approach to marketing, but has to be pursued with much
greater vigor, as it has an environmental and social dimension to it. There are significant indications
that environmental issues will grow in importance over the coming years and will require
imaginative and innovative redesign and reengineering of existing marketing efforts on the part of
many businesses.
575
Marketers also have the responsibility to make the consumers understand the need for and benefits
of green buildings for a healthier living through awareness programs and continuous education
programs.
8.1. Limitations:
1. The research work is primarily limited to the construction industry consumers and consultants in
Bengaluru city and some samples from other south Indian cities only.
2. The research work will be primary limited and based on the information obtained from the
secondary data and the sample size survey taken in the primary data.
9. Implications:
Implications for future research: Since not much research/study work has been done in Bangalore on
green marketing aspects on Ready mix concrete and other green cement replacement products, the
research done has helped and become a reference for the future researchers to carry out more
research and publications on the subject in other cities and metros in India on the green initiatives in
the construction sector for sustainability.
REFERENCES:
[1] Peattie, Ken (2001). Towards Sustainability: The Third Age of Green Marketing. Marketing
Review. Vol. 2, No. 2, pp. 129-147.
[2] Feldman, L. and Staehler, S.(1996). Green Marketing: Do corporate strategies reflectexperts
advice? The Journal of Marketing Management. Vol. 5, No. 1, pp. 20-28.
[3] Roy, M. and Epstein, J.M. (2000). Strategic Evaluations of Environmental Projects in
SMEs.Environmental Quality Management. Vol. 3, pp. 37-47.
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578
S. N. HARISH
MANGALORE UNIVERSITY
ABSTRACT
This paper investigates the stability of beta in Indian stock markets using fifteen years of
daily data of CNX NIFTY FIFTY from 2000 to 2015. The CAPM beta was computed by
using market model regression. Chow breakpoint test was used to examine the impact of the
2008 subprime crisis on the stability of beta. Unknown breakpoints were investigated in the
beta series using multiple breakpoint tests on both individual stocks and portfolios.
Subsequently, CUSUM was adopted to check for the sequential changes in the computed
beta series. The results indicate that 2008 subprime crisis has not much influenced on
structure of the beta series. However, we have found a few unknown break points in different
time periods. Our results show that the betas vary across the study time periods and portfolio
betas as well as those of the individual stocks. The beta stability plays an important role
while estimating the portfolio returns, the individual stock returns and in devising winning
strategies. Therefore, it is highly recommended to the market participants while using
historical betas for prediction of future risk of the stock and portfolio need to be extra
cautious.
Key Words: Multiple breaks, CUSUM test, CNX Nifty 50, Subprime Crisis, Unknown
breaks
I. INTRODUCTION
The two key determinants for holding any financial instrument is its expected reward
579
(return) and risk. Rational investors prefer those financial instruments that have low risk and
high returns. That means the securities that have more market risk should offer higher returns
to entice the investors. Market risk derives from the accidental changes in the prices of
financial assets. How to predict market risk is very vital for the market participants. In
common parlance, risk is the chance of financial loss. Assets having greater chances of loss
are viewed as more risky than those with lesser chances of loss. Therefore, one can define
risk as the variability of the actual return from the expected returns associated with a given
asset/investment. The greater the variability, the riskier the security (e.g. shares) is said to be.
The modern theory of portfolio analysis dates back to the seminal work of Harry
Markowitz. In this theory Markowitz advocated that all rational investors select among
portfolios on the basis of two parameters, that is the expected risk (variance) and the
expected return associated with that
1|Page
580
portfolio. Subsequently, the capital asset pricing model of Sharpe (1964), Jan Mossin (1966) and
Lintner (1965) were responsible for the evolution of asset pricing model. CAPM is a model for
establishing optimal portfolios. In this model they proposed that a stocks risk is characterized by its
systematic risk BETA. Beta measures a stock's volatility, the degree to which stocks price varies in
relation to the overall market movement. Securities betas have been estimated for various individual
stocks and for evaluating the performance of well diversified portfolios by the market participants.
The beta of a firm can be estimated by regressing (OLS) its rate of return against the market portfolio
return. CAPM is still a widely accepted and used model for the estimation of the cost of capital of a
firm.
Apart from this, the theory states that, beta has a predictive power of prospective risk of a
stock and it helps the investigator to estimate exactly the security's prospective riskiness. Therefore as
per CAPM, beta coefficient is a key parameter, which helps in determining the minimum expected
rate of return on risky stocks, construction of portfolio and performance evaluation. As future beta is
calculated from historical data, the stability of beta with time horizon is very crucial for the market
participants so that the prediction is true and appropriate. However, the anomalies that exist in the
financial market, trade cycles, macro-economic factors etc. influence the beta value. Therefore Beta
stability and sturdiness evaluations have become one of the prime focuses of research in finance.
The systematic risk of a stock or a portfolio can be determined by its historical returns.
However, CAPM theory fails to state any ground rules on which return interval and estimation period
should be chosen for the computation of beta, that is whether rates of return should be measured over
a day, a week or a year. Generally, daily returns are used for the estimation of beta. If returns are
independently distributed, betas computed using high frequency returns (daily) should not be
considerably different from a low frequency data (ex. Weekly, or monthly returns). But empirical
findings of Dimson & Marsh (1983) , Hawawini (1983), Cohen et al., (1986) and Draper and Paudyal
(1995), Kim, (1999) show that beta estimates on the basis of daily, weekly, monthly or yearly rates of
return are significantly differing from each other, although they are calculated for the same period of
time. They concluded that betas based on daily returns bring about more stable beta than those
calculated using low frequency data.
581
One of the major observations documented in literature is by Kon & Jen, (1978; 1979) they
noted that the stock market reacts differently during bull and bear phases. This would result in
different betas for different phases even if the beta coefficient had a stable bull and bear value.
Similar findings are documented by the subsequent researchers like Fabozzi and Francis (1977),
Wiggins (1992), Chen (1982) Bhardwaj and Brooks (1993).
One such possible reason is that time-scale dependence of systematic risk of stocks or assets.
In his study Dubey (2014) documented that stocks exhibit considerable instability in their beta
estimates as far as different investment horizons are concerned because of tremendous heterogeneity
with different time horizon in investments. Apart from this he argued that in emerging market
economies, conditions are very fluid.
Beta is related to the leverage of the firm. The systematic risk, which is the risk inherent to the
entire market or entire market segment of a share, can be further divided into two components. First
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582
component is operational risk and the other is financial risk. According to Hamada, (1972);
Mandelker & Rhee, (1984), financial risk is a function of the leverage of the firm. As leverage can
change over a period of time which leads to changes in stock price movements, that leads to changes
in beta of the security or the portfolio. Lally (1998) pointed out that controlling for the degree of
financial leverage may improve beta forecasting. Jagannathan and Wang (1996) and Lewellen and
Nagel (2003), McNulty et al., (2002), (Choudhry and Wu, 2009) documented that stock market
conditions (the volatility and causes of volatility) affect the leverage of the firm and hence the beta of
the firm and that is the major reason behind the instability of the beta over the period of time. Any
new information that does not affect both stock index and individual stock returns homogeneously,
would change the relationship (correlation) between the two and automatically beta of the stock
would change.
The beta stability has been extensively studied in the western financial literature. The
literature has applied a range of models on individual stocks as well as portfolios to check the
stability of beta. Several studies tries to investigate the nature and the behavior of beta in terms of
intervals taken for computation on beta stability, modus operandi for computation of beta on stability
of beta. Couple of studies tries to investigate stability of portfolio beta with individual stock beta,
stability of beta over time and with different market conditions such as bull and bear phases.
However, there is no clear consensus about the beta stability on individual stocks and portfolios.
As stated earlier, the estimation of beta is vital for many applications in finance. The research
on Indian markets in regard to beta stability has been relatively few as compared with western
markets. However, in reviewing the Indian literature, the evidence on stability beta of Indian capital
markets have also showed mixed response. Moreover, the beta estimation is more sensitive issue in
developing economy like India as Indian equity markets witnessed sensational changes in risk and
returns profile of stocks because of fast changing trends in regulation and reforms, volatile business
583
cycle, etc. However, research on beta stability in emerging markets is limited in the literature. Thus
the main objective of this paper is to investigate the stability of betas in Indian stock market with
special reference to CNX Nifty Fifty stocks for a period of fifteen years during 2000 to 2015. Thus,
the current study, contributes to the existing literature by taking into 2008 subprime crisis and its
impact on the beta stability and testing the stability of beta by using models like multiple breakpoints
and CUSUM tests in Indian security market.
1. To identify whether there is any structural break in the computed beta series with reference to
subprime crisis 2008;
3. To examine the behavior and stability of beta across stocks listed in CNX Nifty Fifty
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584
A number of empirical studies have tried to investigate the stability of beta across the stock
markets. Blume (1971) was the first researcher who investigated on the beta stability who shows
empirically that the stability of stock beta increases with the increase in the time of estimation period.
Subsequent studies have addressed the question of beta's stability over time. The most prominent
being Baesel (1971) who concluded that the stability of beta is reliant on two factors; first factor is
the estimation period used and second factor is boundary of the beta picked. Moreover, he claims
that the optimal estimation period is nine years. However Gonedes claims the optimal estimation
period is seven years. Gordon and Chervany (1980) contradicted the Baesels claim of longer the
estimation duration the more stable the betas. They concluded that the ideal estimation interval could
be four to six years.
Levy (1971) has documented that the portfolio betas are stable while individual security betas
are unstable., Altman, Jacquillat, and Levasseur (1974), Roenfeldt et al., (1978), Alexander and
Chervany (1980) and Theobald (1981), Sunder (1980), Bos and Newbold, (1984); Faff et al.,(1992),
Kok (1994); Cheng (1997); Chawla (2001), Moonis and Shah, (2002) and Cheng and Boasson (2004)
supported this view that beta is far from being stable. Alexander and Benson (1982) found that stocks
had varying betas. Bos and Newbold (1984), Collins et al. (1987) found that 58% of stocks had
varying betas and conclude that the beta is not constant over time. Vasicek (1973) found that the
longer the estimation periods, the more stable the estimates become. Vipul (1999) concluded that the
stability of beta varies based on size and liquidity of the firm.
Many empirical studies have been conducted to investigate the relationship between
conditions of the stock market and systematic risk by measuring beta including Black (1972), Francis
(1975) Brenner and Smidt (1977) Fabozzi and Francis (1977), Kim and Zumwalt (1979), DeBondt
and Thaler (1987), Spiceland and Trapnell (1983) and Wiggins (1992)who documented that beta
varies with market conditions. In a study by Xia Pan, et al., (2014) to investigate the stability of beta
in Chinese Stock Market concluded that Macroeconomic factors such as general business
environment and big world events greatly affect companys beta. However, microeconomic factors
like merger and acquisitions, change in management etc. hardly have any impact on betas. In a study
585
by Hakan Er and Sevgi Aydin estimated the betas on the basis of daily, weekly, bi-weekly and
monthly returns of 225 companies listed in ISE over a period of nine years revealed that interval and
length of the estimation period have a major impact on the estimates of beta.
In a study by Levy (1971), Blume (1971), Levitz (1974) and Altman (1974) to examine the
stability of individual stocks as well as portfolio betas concluded that portfolio betas are more stable
than individual stock betas.
In an investigation by Thomas and George (2010) to examine the stationarity of beta for a
period of 14 years and three sub periods 27 out of 60 companies beta were unstable. They concluded
that beta varies in accordance with the vagaries of time. In an investigation by Elton Scott and
Stewart Brown (1980) on the stability of betas concluded that autocorrelated residuals and
intertemporal market-residual correlations between residuals and market returns can result to unstable
4|Page
586
and biased estimates of betas. In an investigation by Mahmoud Haddad et al., (2008) to examine the
Beta stationarity of social Islamic mutual funds performance during 1997 to 2002 concluded that
various sector Islamic mutual funds displays time varying volatility overtime.
In a study by Mansur and Elyasiani (1994) documented that changes in the intensity of
financial regulation on the banking industry may affect betas of the banking stocks. Similar view
was held by Dickens and Philippatos (1994) in American Banking sector and Brooks and Faff (1995)
in Australian Banking industry.
Bal Krishnan and Rekha (2012) tried to investigate that whether betas of stocks are close to
market beta i.e. one and stationarity of beta for a period of twelve years and for different investment
horizon. The study revealed that 54.50 % companies show beta close to one. However, less than fifty
percent portfolios (34.52 %) betas show significant difference. Even, they concluded that the beta is
not stable over the study period.
Dubey (2014) pointed out that the bull and bear market influence the pattern of beta. It
indicates that analysis of beta series help to know the characteristics of the bull and bearish markets.
Further, Harish & Mallikarjunappa (2015) studied the Indian market microstructure and found that
changes in market microstructure impacts the trading process, returns and risk (beta series) of the
securities. These points inherently motivate to analyze the structure of the beta series of the Indian
market.
The current paper organizes further as follows: In section III a brief discussion about the
methodology employed to compute the beta and construction of portfolios along with that of various
models used to test the stability of betas have been discussed. Section IV provides empirical results
and the final section presents the discussion and conclusion and the results have been compared to the
possible evidences.
587
III. METHODOLOGY
The CNX Nifty or Nifty 50 is a robust diversified 50 stock index constituting 23 sectors of the
Indian economy. It is the largest individual financial product in India. It is used for wide range of
activities such as index based derivatives trading, hedging, OTC derivatives, ETF (both onshore and
offshore), fund portfolios. Since CNX Nifty 50 is much more stable than any other indices in India,
the current study on stability of beta has been undertaken of the CNX Nifty 50.
For the purpose of analysis, the daily data from 1st of April 2000 to 31
st
March 2015 is
collected from capital line data base. Based on market capitalization, five portfolios of ten companies
each has been constructed. The portfolio 1 comprises top ten market capitalization stocks and
portfolio 2 compose the next top M cap stocks, portfolio 3 involves the next top ten, fourth portfolio
constitute the next and the last portfolio that is portfolio five was formed with the help of the last ten
that is the lowest market capitalization stocks out of CNX Nifty 50 stocks. Later various stability
hypotheses have been tested on individual stock betas and portfolios.
5|Page
588
Daily Returns
The returns used in this study consist of daily stock and index returns using adjusted closing
price of the CNX Nifty 50 index from 1st of April 2000 to 31stMarch 2015. The daily returns (Rt)
computed from CNX Nifty 50 index by applying continuously compounded returns of the data series
as follows.
Rt = ln[ Ct ] (1)
Ct-1
Where: Rt = return on day t
Ct = Closing Price on day t
C t-1 = Closing Price on dayt-1
BETA computation
The regression equation used to compute beta values for each of the 50 scripts for the period is:
Rit = i + i Rmt + eit
Where,
Rmt indicates the rate of return on the CNX NIFTY (Market return) for time periodt
i and i are the regression parameters to be estimated, i is the intercept of the equation or constant
term and i beta value of the security or market sensitivity of the stock (is the regression coefficient)
Rit is the individual security return for time periodt
eit is the error term
589
One of the major assumptions about a time series distribution is that the underlying process is the
same across all information in the distribution. A time series data may include a structural break; due
to an abrupt change in policy of the state or a sudden shock in the economy, for example subprime
crisis of 2008. A devise that is exceptionally useful in this regard is the Chow breakpoint test.
Therefore, in order to investigate for the structural break in the time series, we use the Chow test. The
following is the formula to compute the structural break points by using Chow test
Where, SC is the sum of squared residuals from the entire data. S1 is the sum of squared
residuals of the first interval (before 2008 crisis) and S2 is the sum of squared residuals from the
second interval i.e. after subprime crisis. However, N1 + N2 stand for the number of observations
from first interval and second interval respectively. k is the total number of assigned parameters for
the purpose of the study. The equation is an application of F-test, and it needed the sum of squared
6|Page
590
errors from three regressions one for the pooled data and one for each sample
period The following two hypotheses have been framed:
The null hypothesis of the test is that, there are no structural break points in the data.
H0: a1 = a2
H1: a1 a2
Bai (1997) showed a new methodology to identify the breaks and further, the study conducted by Bai
and Perron (1998, 2003a) created the methodology to identify the multiple breaks in the series. In this
study, we estimate the structural breaks in the context of Global Maximize Test (GMT) created by
Bai and Perron (1998). Further, we use U Dmax and W Dmax to estimate the multiple breaks in the
series. These two factors help to estimate the breaks by maximizing the breakpoints and incorporating
the weights to the individual company betas.
The CUSUM test is a sequential analysis used to investigate the sequential flow of residuals. This test
works based on the unique graphical representation by plotting the series and this test also constructs
the two critical lines at 5% probability. From this we can assess the stability of the series.
Signs
is
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592
This section explores the structural, unknown breaks in the computed beta series of stocks
listed in CNX Nifty Fifty. The following Table.4.1 shows Chow Breakpoints statistics of CNX Nifty
Fifty individual stocks.
Companies
F Stats
P- Value
Log
P-Value
Likelihood
Ratio
ACC
0.203437
0.66
0.235354
0.6276
0.907193
0.3597
1.020293
0.3124
0.086209
0.7737
0.099144
0.7529
0.14085
0.7135
0.161645
0.6876
593
Bank of Baroda
0.026388
0.8735
0.030416
0.8615
0.456618
0.5132
0.528739
0.4671
BHEL
0.216919
0.6491
0.248226
0.6183
BPCL
0.041382
0.842
0.047673
0.8272
Cipla Ltd.
1.046771
0.3264
1.170876
0.2792
0.020521
0.8885
0.023921
0.8771
0.048513
0.8291
0.055873
0.8131
1.241292
0.287
1.378069
0.2404
1.309352
0.2748
1.449844
0.2286
0.214302
0.6511
0.245255
0.6204
594
0.104313
0.7523
0.121173
0.7278
0.141151
0.7132
0.161988
0.6873
0.356185
0.5617
0.409502
0.5222
0.230095
0.6394
0.263172
0.6079
0.113991
0.741
0.130955
0.7174
IDFC
0.728349
0.4182
0.871347
0.3506
0.176114
0.6821
0.203974
0.6515
Infosys Ltd.
0.180934
0.6775
0.20733
0.6489
ITC
0.109038
0.7465
0.125289
0.7234
Corporation Ltd.
8|Page
595
Jindal
0.099325
0.7576
0.11417
0.7354
0.136676
0.7176
0.15688
0.692
1.262531
0.2815
1.390298
0.2384
Lupin Ltd.
0.55075
0.4712
0.622388
0.4302
0.00098
0.9755
0.00113
0.9732
0.102501
0.7554
0.122375
0.7265
NTPC Ltd.
0.000246
0.9878
0.000301
0.9862
1.301454
0.2745
1.431177
0.2316
0.010837
0.919
0.012801
0.9099
0.082337
0.7787
0.094705
0.7583
Sesa
0.119478
0.7351
0.137229
0.7111
596
0.031019
0.8629
0.035748
0.85
0.203199
0.6596
0.232647
0.6296
0.035633
0.8545
0.043466
0.8349
0.045585
0.8342
0.052506
0.8188
0.014637
0.9056
0.016879
0.8966
0.039409
0.8457
0.045403
0.8313
0.06057
0.8111
0.073783
0.7859
Wipro Ltd.
0.007439
0.9326
0.008581
0.9262
0.020664
0.8879
0.023824
0.8773
It is evident from Table.4.1 that the F-Statistics and Log likelihood ratio accept the null
597
hypothesis of no breaks at specified breakpoints (2008 subprime crisis) for all the companies which
are listed in CNX Nifty 50 Index. This shows that 2008 subprime crisis hardly had any impact on
beta values of the CNX Nifty fifty stocks.
Table. 4. 2
P- Value
Log Likelihood
P-Value
Ratio
Portfolio I
0.122522
0.7319
0.140709
0.7076
Portfolio II
0.004583
0.9471
0.005345
0.9417
Portfolio III
0.000861
0.9771
0.001005
0.9747
Portfolio IV
0.012745
0.9118
0.014698
0.9035
Portfolio V
0.112510
0.7431
0.130651
0.7178
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598
In order to investigate the impact of subprime crisis 2008 on beta stability on portfolio of
stocks comprising of stocks listed on CNX Nifty fifty stocks Chow test has been conducted. It is clear
from table. 4.2 that the F-Statistics and Log likelihood ratio accept the null hypothesis of no breaks at
specified breakpoints (2008 subprime crisis). This indicates that 2008 subprime crisis has hardly any
impact on the portfolios. Another notable observation is that the standard deviation of the entire
constructed five portfolio betas are less compared to that of the individual stock betas. There is less
difference in the standard deviation of portfolios in pre and post 2008 subprime crisis period
compared to those comparable to individual stocks. The test seems to indicate that the portfolios are
more stable than the individual stocks beta. Based on these findings, we may conclude that the
construction of portfolios based on Market capitalization has lessened the 2008 crisis impact on
portfolios beta series.
CNX Nifty 50 stocks were not affected by 2008 subprime crisis. Further to investigate the
presence of any unknown breaks in the computed beta series other than subprime crisis 2008 that may
affect the stability of the betas for both individual shares and portfolios, multiple breakpoint test has
been conducted.
Table. 4. 3
STOCKS
Companies
UD max
WD max
determined breaks
determined
breaks
599
ACC
Bank of Baroda
BHEL
BPCL
Cipla Ltd.
600
10 | P a g e
601
Infosys Ltd.
ITC
Jindal
602
Lupin Ltd.
NTPC Ltd.
Sesa
603
Wipro Ltd.
Table No 4.3 Presents the both with breaks and without break betas series of CNX Nifty fifty
shares for the study period between 2000 to 2015 based on the UD max determined breaks and WD
max determined breaks result. According to the UD max determined breaks results, 3 (7.69%)
companies betas have no structural breaks, followed by, 9 (23.08%) companies betas have single
breaks, 5 companies (12.82%) have double breaks in their beta series. Another 6 companies have
(15.38%) triple breaks in their betas, five companies (12.82%) have four breaks in their computed
betas and balance 11 companies (28.21%) have five breaks in their beta series for a study period from
2000 to 2015.
However, WD max results, 3 (7.69%) companies betas have no structural breaks, followed by,
11 | P a g e
604
3 (7.69%) companies betas have single breaks, 3 companies (7.69%) have double breaks in their beta
series, another four companies have (10.26%) triple breaks in their betas, six more companies
(15.38%) have four breaks in their computed betas and balance 20 companies (51.28%) have five
breaks in their beta series for a study period from 2000 to 2015.
The current study points out that the presence of the unknown breaks in major chunk of CNX
Nifty Fifty individual stocks beta series for a study period of 2000 to 2015, though all the stocks
which are listed in CNX Nifty Fifty have no structural breaks during the 2008 subprime crisis. That
means 7.69 % of companies do not have any breaks in their beta series, however, balance 92.31% of
the companies have breaks in their betas.
Table 4. 4
Portfolio
UD max
determined
WD max
determined breaks
breaks
Portfolio I
Portfolio II
Portfolio III
Portfolio IV
Portfolio V
605
The Table. 4.4 shows the identified breaks for the constructed portfolios. The results of Bai and
Perron test, portfolio 1 has four UD max determined breaks and four WD max determined breaks.
Whereas portfolio two has four UD max determined breaks and five WD max determined breaks.
Portfolio 3 with two UD max determined breaks and four WD max determined breaks; portfolio 4 has
four UD max determined breaks and four WD max determined breaks and the last portfolio that is the
portfolio 5 consists of least market capitalization category of stocks has five breaks each in the study
period of 2000 to 2015.
In the last step CUSUM test has been conducted to find the sequential changes in the beta
series of the stocks and also in the constructed portfolios. Out of stocks listed on CNX Nifty Fifty 32
(64%) companies have stable betas. However, 18 (36%) companies betas are unstable at 5% level of
significance.
12 | P a g e
606
Table. 4.5
CUSUM Test Results of CNX Nifty Fifty Stocks
50
32*
18*
Observe following Exhibit 4.1. As for as portfolios are concerned, the CUSUM test statistic of
Portfolios-1 and Portfolios-4 are unstable and is higher than the portfolios 2, 3 and 4. However, the
results for portfolio 2, 3 and 4 CUSUM test series nearer to zero mean value. The CUSUM values for
portfolio 1 and 2 have more deviation compared to the portfolios 2, 3 and 4. It is interesting to note
that the stocks which have more breaks as per the results of multiple break points test are the major
components of portfolios 1 and 4. This may answer the major logic behind the more deviation in the
portfolios 1 and 4.
01 0 0 0 0 0 00 0 1 11 1 1 1 1
607
2 3 4 5 6 78 9 0
2 3 4 5
CU
5%
SU
Signifi
cance
0 0 0 0 0 0 0 1 1 1 1 1 1
02 3 4 5 6 7 8 9 0 1 2 3 4 5
0 0 0 0 0 0 0 1 1 1 1 1 1
CU
5%
02 3 4 5 6 7 8 9 0 1 2 3 4 5
SU
Signific
ance
CU
5%
SU
Signifi
cance
0
2
0
1
0
0
1
0
2
608
0
0 0 0 0 0 00 0 1
11 1 1
01 2 3 4 5 6 78 9 0 11 2 3 4 5
CU
5%
13 | P a g
e
609
SU
Signific
ance
1
2
8
4
0
-4
-8
1
2
0
02
03 04 05 6 07 8 09 10 11 2 13 14 5
CU
5%
SU
Significa
nce
Although majority of the available literature recorded that portfolio betas are much more
610
stable than individual stocks beta, the outcome of this study indicated that both individual as well as
portfolio betas behave very similar with respect to its stability. Our results seem to agree with the
results of Deb and Misra (2011), Balkrishnan and Rekha Gupta (2012), Sibel Celik (2013).
In the last phase, out of fifty stocks taken for the purpose of the study listed on CNX Nifty
Fifty majority of the companies have their betas stable. Further we do not find any pattern in the
stability of beta with respect to portfolios.
The present study revealed that the beta values are not stable over a period of time thus; the
investors should take precaution while measuring the systematic risk. Apart from this it is strongly
recommended to the market participants to consider the time-varying behavior of beta while making
the investment decision on individual stocks and managing portfolio. The empirical findings of the
study is very important for the market participants as beta has a predictive power of prospective risk
of a stock and it helps the investor to estimate exactly the security's projected riskiness. Hence, the
participants should be very careful while calculating risk by taking beta as a parameter. They should
keep updating the beta while holding, buying and selling individual stocks and constructing and
managing portfolios. Thus, they can alter their investment strategy based on the actual changes in the
levels of beta rather than the computed beta based on the historical returns.
14 | P a g e
611
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16 | P a g e
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Abstract
Corporate social responsibility aims at making the process of maximizing the wealth of
shareholders more effectively and fairly by taking care of the needs of the society as well. This
concept has gained importance in the recent past as business could realize the benefit of CSR in
the form of customer loyalty, community support and reduction in environment hazards.
Companies need to identify its key stakeholders so that it can manage social and environment
responsibility appropriately in response to these stakeholders expectations. This paper aims to
compare the CSR performances of sample industries in India and develops a relationship between
CSR and corporate financial performance. A sample of 120 companies has been taken from the
list of ET 500, 2012 to compare the corporate social performance based on self identified
parameters of social performance and further relate it with financial performance based on six
financial ratios. The result of the Kruskal Wallis test reveals that there is no significant difference
in the Indian companies in following CSR practices and reporting them in their annual reports.
Moreover, as per the correlation analysis no significant relationship was found in the corporate
social and financial performance. This implies that Indian companies need to adopt a
comprehensive strategy to follow CSR policy implications and take financial benefit of social
performance in the long run.
Key Words: Corporate Social Responsibility, Parameters of CSR, Financial Performance,
Comparison.
JEL classification: M 14
Introduction
Corporate Social Responsibility (CSR) defines the role of business which is beyond its objective
of profitability and includes the concept of social and environment concerns for the community.
As business is also a part of society and uses the resources equally, it is responsible for the
621
protection of the society. Thus, CSR states the responsibility of the business towards the society
and the community to which it is related directly or indirectly. Business need to identify all
stakeholders who are affected by its operations and need to identify their expectations and include
them in its strategic decision making.
The concept of Corporate Social Responsibility aims at making the process of maximizing the
wealth of shareholders more effectively and fairly by taking care of the needs of the society as
well. Society provides the business with the resources required for running the business
successfully which not only include physical resources but all human resources and as such
business should return the benefit of the same by way of being responsible towards the needs of
the society besides taking care of the environment. Therefore, CSR is a system of cooperation and
mutual understanding between the business and the society at large. The main objective of
following CSR by business is to maximize welfare of society by providing them quality goods
and services at reasonable cost and at the same time reducing the environment cost as well.
Business needs to manage its relationship with wider society, whether for reasons of commercial
viability or to add value to society (Blowfield and Frynas, 2005).
This concept has gained importance in the recent past as business could realize the benefit of CSR
in the form of customer loyalty, community support and reduction in environment hazards. Archie
Carroll in 1991 describes CSR as a multi layered concept that can be differentiated into four
interrelated aspects economic, legal, ethical and philanthropic responsibilities. The World
Business Council for Sustained Development (1992) defined Corporate Social Responsibility as
The continuing commitment by business to behave ethically and contribute to economic
development while improving the quality of life of the work force and their families as well as of
the local community and society at large. Thus, CSR has twofold objectives i.e. to behave
622
ethically towards internal and external stakeholders and to be responsible towards environment
and society at large. The increased realization of CSR by companies in India is not only having a
positive influence on society but also helping the companies to act in economically, socially and
environmentally sustainable and responsible manner (Murthy and Pitty, 2013).
Indian companies have recognized their responsibility towards different stakeholders along with
social obligations. Nearly all leading companies in India are involved in CSR programs in areas
like education, health, livelihood creation, skill development, and empowerment of weaker
sections of the society, medical camps, raising awareness on protecting and enhancing the
environment (Jayakumar et al, 2012).
Improved government regulations, market reputation and stakeholders pressure are the main
forces driving corporate social responsibility. However, companies need to identify its key
stakeholders so that it can manage social and environment responsibility appropriately in response
to these stakeholders' expectations. The appropriate socially responsible actions give the new
avenues to the companies to do business innovatively and ethically and to achieve better
outcomes from its performance (Nguyen, 2011).
The social responsible behavior towards stakeholder improves shareholder value in different
ways. Regarding customers and employees, CSR helps in enhancing reputation which further
leads to higher returns and make the company capable of attracting and retaining talented
employees.
Review of Literature
Jaya Kumar et al (2012) concluded that CSR has become an essential element of business strategy
in Indian companies. Most of the organizations have realized that CSR is not only for
623
the benefit of society but also helps to create value for them in the long run. CSR impacts internal
and external stakeholders, reduces business risk of disruptions and enhance brand value and
reputation. Initiating CSR and sustainability awards is another step to encourage companies to
pursue such activities. The mandatory requirement to spend 2% of net profit on CSR would
further lead Indian companies move on the track of social development and upliftment of the
weaker sections of the society along with government.
Arevalo and Aravind (2011) found that in India, the liberal mode of social responsibility is mostly
adopted as it focuses on social responsibility but is limited to private owners only. CSR in India is
not practiced to serve the society but to save taxes and take benefit of other government schemes.
Although now some companies have started voluntary efforts toward CSR but still it has not
become a strategic part of their planning as compared to the companies in developed countries.
Shanmugam and Mohamed (2011) in their study on CSR in Indian Automobile sector reveal that
CSR has become an integral part of their business strategy. CSR activities have been initiated for
the benefit of the stakeholders. There is significant difference between different automobile
companies with regards to their efforts for CSR towards customers and employees. Murthy &
Pitty (2013) found that CSR has taken as important place in strategic planning of public sector
enterprises also. A study of BHEL involvement in CSR show that special allocation of funds is
made towards CSR initiatives and the mandatory and voluntary guideline are followed by the
organizations. The company aims at sustainable development by taking care of interest of all
stakeholders with special attention to deserving lower sections of the society. This has led to
building good reputation in the community and even satisfied and motivated workforce.
624
Guha L. (2011) reported that business world in India has been practicing CSR since its inception.
CSR reporting is used as an important instrument to improve its ratings. There is scope for
improving CSR by making it more comprehensive and defining its quantitative and qualitative
parameters in a broader context. Kansal and Singh (2012) commented that innovative practices
help in reducing cost and thus improving the profitability of the organizations. As per the
research, Indian companies are lacking in managing its human development index. The
organizations need to work on employee centered policies to improve profitability. Dey and
Sircar (2012) concluded that when CSR initiative are strategically integrated in the operations of
the business, it not only benefit the stakeholders but helps the organization to build reputation,
customer confidence, employee satisfaction and better market conditions. Mittal et al (2008)
stressed that immense pressure from the stakeholders has forced Indian companies to embrace
CSR activities. The study reveals an insignificant relation between CSR and EVA but CSR and
MVA are positively correlated. CSR has evolved over a period of time in India but there is no
enough evidence available to link it with improved financial performance. However when CSR is
identified as a strategy to achieve its goal, it can bring positive returns in the long run.
Tewari (2011) studied the CSR activities that are communicated through annual reports. The
content analysis of the annual reports dedicated to CSR is a tool to measure the extent of CSR and
practiced by business organization. An analysis of CSR reporting by Indian companies against
MNC reveals that as compared to MNC taking care of quality of work life of employee, Indian
companies gave importance to fair remuneration to employees. MNC gave important to product
quality where as Indian companies consider pricing as an important element of product
responsibility. Indian companies are reporting about environment issues in detail in annual
625
reports but society issues are not an integral part of CSR reporting by Indian companies as
compared to MNCs.
Padhiyar(2013) stated that CSR tries to keep a balance between economic and social goals of the
organization. CSR practices are the practical implementation of ethical values of the business.
CSR takes a holistic view to take care of all shareholders. A study of Indian companies
involvement in CSR reveal that CSR strategy can be used as an important tool for competitive
advantage that may lead to sustainable development.
Verma (2011) founds that CSR has grown in India but the lack of awareness and legal norms raise
a doubt in the minds of the investors to value CSR at the time of investment or not. Very few
investors in India give weightage to CSR initiatives undertaken by the companies as they think it
to be a constraint on their profitability which may have negative impact on their returns. Das
Sudhir Chandra (2009) reported corporate sector in India is giving considerable attention to social
responsibility both central and state government have been allocating funds for social and
community development government fund allocation for health sector is very poor but in spite of
spending a lot on education, there is a need for public private partnership to develop these sectors
and work for the development of backward areas. Institutional level reforms are being initiated to
integrate CSR with corporate operations. CSR no longer is only a philanthropic activity but it can
be used to build corporate image, with stakeholders confidence and thus even improve
profitability in the long run.
The broad objectives of the study are:
4. To understand the extent of CSR being followed and reported by the selected companies on the
defined parameters.
626
Employees Grievance Redressal: Employees are considered an important stakeholder as per the
stakeholder theory. As a part of corporate social responsibility, companies have to take care of all
stakeholders including the employees. One of the important parameter for protecting the interest
of the employees is to have a separate employees grievance cell and attend to their complaints
and problems within the organization. Thus, the companies redressing more than 90% of the
employees complaints received during the year get a score of 3, if 70% -90% of the complaints
are redressed, a score of 2 is given and if less than 70% complaints are redressed or it is not
reported by the company, then a score of only 1 is given.
ii. Fair appraisal and Remuneration policy: As per the different committees of SEBI on corporate
governance and clause 49, it is desirable for the companies to have a well
627
defined remuneration policy for ensuring fair appraisals and compensation to the
executives and employees. Thus, the companies in which separate mechanisms have been
defined for the appraisals and remunerations of the employees and proper disclosures of
remuneration paid to top executives have been made, a score of 3 is given. The companies
in which remuneration is paid as per the HR policy and no separate policy has been
defined, a score of 2 is given where as the if nothing is stated regarding remuneration or the
disclosures are not made properly then a score of only 1 is given.
iii. Customer Grievance Redressal: Even the consumers are an important stakeholder for the
company and the companies need to protect their interest as well. This can be done by
giving quality products at reasonable prices and by handling their complaints as early as
possible. Thus, the companies redressing more than 90% of the consumers complaints
received during the year get a score of 3, if 70% -90% of the complaints are redressed, a
score of 2 is given and if less than 70% complaints are redressed or it is not reported by the
company, then a score of only 1 is given.
27. Supporting Charitable foundation for CSR: Supporting social community through
different CSR activities is an important dimension of being socially responsible. The
companies are taking different initiatives to support the social development and take care of
society issues. If the companies are making voluntary efforts on their own to help the local
community, they get a score of 1, if the companies are supporting any NGO or government
program for helping the community they get a score of 2 and if the companies run their
own charitable foundations and undertake different initiatives for community development,
they get a score of 3 in that case.
628
Percentage profit spent on CSR: As per the latest guide lines by the company act, 2013 it has
been made mandatory for the companies to spent 2% of their net profits on CSR activities. Thus,
the companies spending more than 2% on CSR get a score of 3; those spending between 1% -2%
get a score of 2 and if the companies are spending less than 1% of their net profits on CSR
activities get a score of only 1.
Parameters of Financial Performance
The market valuation is studied using Tobins Q, Price earnings ratio (P/E) and price to book
value ratio (P/B). For profitability, the ratios used are profit before interest and tax margin (ROS),
return on capital employed (ROCE) and return on equity (ROE).
Sample Size
A sample of 120 companies has been taken from the list of ET 500, 2012. As this study is
covering manufacturing and IT industries, the companies involved in banking and financial
services are excluded from the list. The top 15 companies based on revenue from Iron and steel,
IT and computers, Engineering and electrical, Auto and ancillaries, Pharmaceuticals, Chemicals
and fertilizers, Oil refineries and power and Diversified and consumer appliances were taken for
the study.
Data Collection
Data regarding corporate social responsibility has been collected using the annual reports,
sustainability reports and business responsibility reports available at the websites of the
companies for the year 2012-13. The financial data for the period of three years 2010-11 to 201213 has been taken from the annual reports of the companies available at their websites. Prowess
database and moneycontrol.com were also referred to collect the relevant data required for the
study.
629
Data Analysis
To address hypothesis 1, Kruskal Wallis Test has been applied to test the significant difference
among the corporate social performance of selected industries. To address hypothesis 2,
correlation analysis has been done to study the relationship between corporate social
responsibility score based on selected parameters and financial performance in different
industries.
Analysis and Discussion
Name of the
Sl.No. Industry
%
Employee
Customer
profit
Grievance Fair
Grievance Charity
on
redressed Appraisals redressed Foundation CSR
Total
CSR
Score
%
Steel
46.67
42.22
44.44
51.11
42.22
45.33
IT & Computer
51.11
68.89
51.11
51.11
40
52.44
Electronics and
Engineering
37.77
55.55
35.55
57.78
37.77
44.89
48.89
55.55
51.11
46.67
48.89
42.22
Pharmaceuticals
5
Chemicals &
Fertilizers
52.89
55.55
62.22
57.78
48.89
40
40
46.67
44.44
51.11
37.77
44.00
Refineries and
Power
7
8
Diversified
61.33
66.67
62.22
75.55
60
42.22
44.44
64.44
44.44
55.55
44.44
630
50.67
631
Table 1 represents the item wise score of corporate social responsibility for different industries
under study. Five parameters of corporate social responsibility have been considered for the
study. The disclosures are not very healthy for employees grievance redressal as refineries and
power industry gets a maximum score of only 66.67% followed by Auto and Pharmaceutical
industry getting a score of 55.55% each. In Electronics and Engineering industry and chemicals
and fertilizers industry the performance is very low at 37.77% and 40% respectively. Regarding
fair appraisal of employees through well defined remuneration policy and executive pay
disclosures IT and Computer industry with a score of 68.89% have given the maximum
disclosures in this respect followed by Diversified industries at 64.44% and Pharmaceutical and
Refineries at 62.22% each. Regarding redressal of customer grievances again refineries and power
sector is at the top of the list with a maximum score of 75.55% followed by Pharmaceutical
industry at 57.78%. Other industries are also catching up but electrical and engineering industry is
at the bottom of the list with a minimal score of 35.55% only for handling customer grievances.
As part of corporate social responsibility, many companies are taking social initiatives through
their own foundation or supporting NGOs. With this regard refineries industry with more number
of public sector undertaking is having the highest score of 60% followed by electronics and
engineering Industry at 57.78% and Diversified industry at 55.55%. Even the steel, IT and
Chemicals industries have shown good commitment to social responsibility by supporting charity
foundations at score of 51.11%. Very few companies in different industries are contributing 2%
of their profits towards corporate social responsibility. Hence, no industry has got even a score of
50% for this variable. Over all refineries and power industry, mostly dominated by public sector
companies, has performed best with a total CSR
632
score of 61.33% followed by Pharmaceutical and IT industries, mostly having private sector
companies, scoring about 53%.
Mean Rank
CSR Steel
15
45.03
IT and Computers
15
67.53
Electrical
15
53.67
15
57.13
Pharmaceuticals
15
64.77
15
49.03
15
80.10
Diversified
15
66.73
Total
120
11.848
Df
Asymp. Sig.
.106
To sum up, Kruskal-Wallis test revealed that there is no significant difference between the eight
industries on the basis of the social performance scores computed H(7) = 11.848; p> 0.05; p =
0.106). This suggests that companies in different industries in India are reporting or following
voluntary corporate social responsibility practices at equivalent level. Thus, null hypothesis is
accepted and alternate hypothesis H1 is rejected that there is a significant difference in the ethical
performance of different industries under study.
Table 4: Spearman Correlation Between
CSR and Financial Ratios
CSR
Correlation
TobinQ Coefficient
PE
PB
ROS
ROCE
ROE
0.24
Sig. (2-tailed)
0.01
Correlation
Coefficient
-0.14
Sig. (2-tailed)
0.18
Correlation
Coefficient
-0.18
Sig. (2-tailed)
0.07
Correlation
Coefficient
0.27
Sig. (2-tailed)
Correlation
Coefficient
0.13
Sig. (2-tailed)
0.15
Correlation
Coefficient
0.1
634
Sig. (2-tailed)
0.29
From Table 4, we can find that there is a positive correlation between market valuation measure of
Tobin Q and total social responsibility score, which was statistically significant (rs=0.24, p=0.01).
But the other two measures of market valuation that is price earning and price to book value ratio
show a negative correlation with CSR score and are not statistically significant also with p value
being more than 0.05. With regard to the profitability measure, ROS has a positive correlation
with CSR ( rs= 0.27) and is also statistically significant (p=0.00). Even for return on capital
employed and return on equity there exist a low positive relationship with social performance but
is not statistically significant. Although the results indicate a positive relationship between ethical
performance and profitability but this is not strong enough to motivate and justify corporate world
to adopt social responsibility practices for enhancing profitability.
Discussion
The notions of Triple Bottom line is also gaining ground in Indian corporate world giving equal
importance to financial, social and environment reporting. Liberalization of Indian economy and
globalization has forced Indian company to adopt ethical principles and standards to compete at
international level. All the sectors have undertaken CSR initiatives and recognized the
responsibility towards different stakeholders employees, customers and communities at large as
suggested by Chaudhri and Wang (2007) that involving stakeholders in CSR implementation
helps in fostering long term relationship with stakeholders. Indian Companies as trying to match
the mandatory requirement of spending 2% of their profit on CSR initiatives (Sharma 2013) but
most of the companies under study have a score of less than 50% in spending the requisite amount
on CSR. CSR is just a tick in a box activity rather than a meaning full contribution
635
towards the society and is a token gesture only (Gautam and Singh 2010), (Sandhu and Kapoor
2010). This may be attributed to lack of resources and vague standards (Arevalo and Aravind,
2011). More stress has been laid on community welfare as compared to responsibility towards
employees and customers (Shanmugam & Mohamed, 2011) Kansal and Singh, 2012)
This study highlights that business and social responsibility can go hand in hand where the
corporate world would recognize these practices as an integral part of their strategy for
competitive advantage rather than treating social responsibility as a burden on corporate
performance. Being responsible towards employees and customers brings loyalty customer
goodwill and resultant market share (Chatterjee, S. 2007)
This is an undeniable fact the CSR is beneficial for the stakeholders by way of more satisfied
employees and customers whose complaints are redressed properly, justified and fair appraisals
are done and social initiatives are adopted through charity foundation. At the same time it was
found that CSR has a positive impact on Tobin Q, ROS, ROCE and ROE which means increase in
CSR investment would have a direct impact on profitability but the statistical analysis reveal that
there is no significant impact of CSR performance on market valuation and profitability of the
business. The results are consistent in the (Izzo & Magnanelli) who have denied the existence of a
particular role of corporate social performance in defining the cost of debt of the company. Even
(Brine et al, 2007) did not find any statistically significant relationship between adopting CSR and
financial performance of Australian companies. The results of the study by Goukasian & Whitney
(2007) also reveal that operating performance of the companies has worsened compared to their
performance prior to the identification of CSR activities in the business organization. Even after
doing the industry adjustments there was no significant difference in mean performance of the
companies for the two periods.
636
It can be concluded from the analysis that Indian companies have a lopsided approach towards
corporate social responsibility initiatives as more stress is on social initiatives and other
stakeholders have been ignored by most of the companies. The low level of CSR performance
against the expected score may be due to the lack of integrated and rational CSR policy and
governing standards (Kansal and Singh, 2011).
The results are inconsistent with Rais, Goedegeburre (2009) where they have reported that
corporate social performance leads to better financial performance in term of revenue and growth.
Even though the investors are not valuing the social responsibility and disclosure but still it has
impact on corporate performance through increased reputation, product image and other non
financial indicators. The present study confirms the result of the study by Tripathi & Seth, 2014 in
which the researchers did not find any significant relationship between corporate social
performance and corporate financial performance for the selected Indian companies.
Conclusion
No doubt the things are changing and companies and managers are becoming proactive is
adopting social initiatives as integral part of their operations but Indian corporate world has to go
a long way to sincerely implement the regulation as per new companies Act, 2013. As we are
moving from voluntary disclosure to mandatory disclosures, many new challenges will come to
the fore front. It is still the infant stage for Indian companies to adopt these changes and make
ethical practices an integral part of their corporate agenda.
The study recommends that Indian companies should adopt a balanced approach towards its
responsibility for different stakeholders and form separate committees for proper planning,
implementation and disclosure of CSR initiatives. The need of the hour is to formulate effective
637
strategic practices according to the type of industry and then relationship with its stakeholders so
that CSR initiatives can be implemented to attain its goal of sustainability with social and
economic growth. The findings are useful for the stakeholders as the shareholders would be
benefited by the increase in profitability and efficiency of the company and the employees,
customers and society at large would be at advantage when companies fulfill their social
responsibility and follow sustainable business practices.
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ABSTRACT
The banking industry can play an outstanding role between economic growth and
environmental protection for promoting environmentally sustainable and socially accountable
institution. The banking of this kind can be termed as "Green Banking". Green Banking refers
to the banking business conducted in selected area and technique that helps the overall
reduction of external carbon emission and internal carbon footprint. To aid the reduction of
641
external carbon emission, bank should finance green technology and pollution reducing
projects. Green finance as a part of Green Banking makes great contribution to the transition
to resource-efficient and low carbon industries i.e. green industry and green economy in
general. Green banking is a component of the global initiative by a group of stakeholders to
save environment. The present paper aims to highlight the means to create awareness in
internal as well as external sub systems among target groups and impart education to attain
sustainable growth through green banking. Further, an attempt has been made to enumerate
effective methods for green banking.
INTRODUCTION
Green banking means promoting environmental- friendly practices and reducing your carbon
footprint from your banking activities. This comes in many forms. Using online banking
instead of branch banking, paying bills online instead of mailing them open up CDs and
money market accounts at online banks, instead of large multi-branch banks or finding the
local bank in your area that is taking the biggest steps to support local green initiatives. Green
Banking helps to create effective and far-reaching market-based solutions to address a range
of environmental problems, including climate change, deforestation, air quality issues and
biodiversity loss, while at the same time identifying and securing opportunities that benefit
customers. Green Banking Product Coverage includes:
Green mortgages
Green loans
Green credit cards
Green savings accounts
Green checking accounts
Green CDs
Green money market accounts
Mobile Banking
Online banking
Remote deposit (RDC)
The First GREEN Bank
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Based in Eustis and Clermont Florida USA, First Green Bank is the first bank of its kind to
promote positive environmental and social responsibility while operating as a traditional
community bank providing excellent service to investors and clients. The progressive
approach to the community and the Earth sets it apart from other banks.
State Bank of India (SBI), India's largest commercial bank, took the lead in setting
high sustainability standards and completed the first step in its 'Green Banking' initiative
with Shri O. P. Bhatt, Chairman, SBI, inaugurating the bank's first wind farm project in
Coimbatore. Recent Green Bank initiatives include a push for solar powered ATMs,
paperless banking for customers, clean energy projects and the building of windmills in rural
India. State Bank of India is a leader in green banking.
where
Nj
Rij= Rank given for ith item by the jth respondents.
Nj = Number of items ranked by jth respondents.
The present position of each rank thus obtained was converted into scores by referring to the
table given by Henry Garrett. Then for each factor the scores of individual respondents were
643
added together and divided by the total number of respondents. These mean scores for all the
parameters were arranged in the order of their ranks and inferences were drawn.
BENEFITS OF GREEN BANKING
1. Avoids Paper Work: Paperless banking almost all banks in India are computerized
or operate on a core banking solution (CBS). Thus there is ample scope for the banks
to adopt paperless or less paper for office correspondence, audit, reporting etc. these
banks can switch over to electronic correspondence and reporting thereby controlling
deforestation.
2. Creating Awareness to Business People about environment. Many NGOs and
environmentalists are propagating environment consciousness among the public in
general by arranging awareness programs and organizing seminars etc. Banks may
associate themselves by sponsoring such programs. Besides, many corporate bodies
are organizing similar program in their own line of business such as "free pollution
check program" organized by a car manufacturer. Banks may tie with such corporate.
These will help to brighten the image of the bank.
3. Loans at Comparatively Lesser Rates: Banks can also introduce green bank loans
with financial concessions for environment friendly products and projects such as fuel
efficient vehicles, green building projects, housing and house furnishing loans to
install solar energy system etc. Sustainable.
4. Environmental Standards for Lending: Banks follow environmental standards for
lending, is really a good idea and it will make business owners to change their
business to environmental friendly which is good for our future generations.
Role of Green Banking in sustainable growth
Green banking can help a lot in attaining sustainable development by creating awareness and
by imparting education. Awareness can be through communication. The first step would be
defining target groups and means of communication. We can divide the whole system into
two subsystems that is internal and external sub-system. For internal sub systems, means
which can be followed to create awareness on the issue can be weekly green news on
internet, clearing programmes, high level meetings, bank's newsletter, publication etc. and the
target groups are managers and other personnel. As far as external subsystems are concerned,
effective means which can be followed are websites, capacity building, road shows, events
meetings, bench marking, media etc. whereas clients, subsidiaries and general public are
target groups. Education can be imparted to related people by Interactive E-learning Programs.
644
645
Creating Awareness
Imparting
Education
Through
Internet
E-learning
Internal Subsystem
External Subsystem
Programs
Interactive
Target Groups
Means of
Target Groups
Means of
Internet
Creating Awareness
->Managers
Creating Awareness
-> Weekly green news
->Personal
Application
Website
On internet
Capacity
Special fields
-> E-learning Programs
Clients
Building
the
Internet
-> High level meetings.
SubsidiariesRoad Shows
Participation
-> Banks News letter.
General Public
Events Meetings
Conferences
And managers
-> Publications.
Bench Marking
Publication of
Media
Information
Material
Annual
Environment
Report
646
on
Table 1(a) Managers View Regarding Ranking of Effective Means followed to create
awareness among Managers and Personal as Internal Subsystem to attain sustainable
development through Green Banking.
Sr. No.
Total
1.
E-learning programs
39 28
22
100
2.
Banks Newsletter
45 28
21
100
3.
100
on 60 34
Internet
4.
41 30
18
100
5.
Publications
52 31
13
100
75 60
50
40
25
Sr.No
1.
E-learning programs
50
6115
61.15
2.
Banks Newsletter
50
6315
63.15
III
3.
40
6880
68.80
internet
4.
280
100
6155
61.55
IV
5.
publication
120
25
6555
63.55
II
It has been observed from Table 1(a) and 1(b) that weekly green news on preferred
choice as effective mean followed to create awareness among managers and personnel as
internal subsystem to attain sustainable development through green banking with average
Garret score 68.80 followed by publications and banks newsletter with average Garret score
647
63.55 and 63.15 respectively. However, high level meetings and E-learning programmes
were considered not so effective. Therefore, emphasis must be given to publications,
newsletter and news on internet so that managers and other personnel may be wellversed with the concept.
Table 2(a) Views regarding Ranking and Effective Means followed to create awareness
as External subsystem among clients, subsidiaries and General Public to attain
sustainable development through Green Banking.
S .No
Factors
Total
1.
Websites
12
22
27
20
11
100
2.
Event Meeting
20
19
24
11
21
100
3.
Bench Marking
10
14
23
19
28
100
4.
Capacity Building
14
10
25
30
14
100
5.
Road Shows
19
17
14
21
20
100
6.
Media
22
11
20
24
18
100
77
63
54
46
36
23
S. No Factors
Total
Average Rank
Garret
Score
1.
Website
924
1386 1458
368
720
253 5109
51.09
III
2.
Event Meeting
1540
1197 1296
506
180
483 5202
52.02
3.
Bench
770
882
1242
874
216
644 4628
46.28
VI
1078
630
1350
322
47.82
Marking
4.
Capacity
Building
5.
Road Shows
1463
1071 756
414
756
460 4920
49.20
IV
6.
Media
1694
693
1104 180
414 5165
51.65
II
1080
648
Table 2(a) and 2(b) depict that event-meetings, media and websites have been rated as
most effective means of creating awareness as external subsystems among clients,
subsidiaries and general public to attain sustainable development through green banking
having average Garret score 52.02, 51.65 and 51.09 respectively. However, road shows were
also given certain weightage with average Garret score 49.20. Whereas, capacity building and
benchmarking were considered as least preferred choice as means of creating awareness
among clients, subsidiaries and general public as external system. Therefore, a wide publicity
is required to make general public aware about the issue.
METHODS ADOPTING GREEN BANKING
1. Online Savings Account: Online savings account and mobile banking is the easiest
way that you can do your part to bank green and help the environment. Green banking
includes setting up direct deposit to receive your paychecks, receiving electronic
statements from your bank and by paying bills online. All of these steps can
drastically reduce the amount of paper produced by your bank. Online banking and
mobile banking are also highly effective ways to keep track of your finances and to
avoid late payment fees. Another green banking step you can take is to suggest that
the company you work for sign up for a product called "Remote Deposit". Remote
customers have to physically deliver each check to their bank to make a deposit.
Remote deposits also allo0w banks to easily clear checks digitally.
2. Paperless Statements: Sending out bank statements by mail is a big waste of paper.
Signing up for online banking at most banks includes an option for customers to
receive their statements electronically through a secure log - in. Copies of banking
records and statements can then be stored electronically instead of in a filing cabinet.
Receiving statements electronically also reduces the chance of identity theft.
3. Use Direct Deposit: Most employers will give employees the option to receive their
paycheck electronically. Not only does this speed up the availability of your money
and save you a trip to the bank, it saves paper, lots of paper work etc.
4. Online Bill Payments: Paying bills online is something of a lifestyle change, but it
can be done. Telephone bills, cable bills, utility bills, credit card payments and
mortgage payments can all be paid electronically. In fact, some online banking
customers have thrown away their checkbooks and completely converted to online
payments. Not only is the recordkeeping much easier, but again massive amounts of
paper is saved.
649
5. Reward Debit and Credit Cards: Some banks have joined up with environmentfriendly groups like The Sierra Club or Defenders of Wildlife to create reward debit
cards and reward credit cards. Participating banks will make a small charitable
donation as a percentage of your online banking activity to help the environment.
6. Net Banking: Online banking is when customers perform most of their banking
related functions without visiting the bank, personally. To do so, customers must
possess an internet banking ID and a password provided by the bank in which the
individual customer has an account. Online banking offers several benefits like time
saving, convenience, 24 x 7 service, eco-friendly process, easy access etc.
Credit and Debit Cards. Credit card and debit card can be used while making
the payment of various expenses without caring the money.
Online Bill Payment. Through online payment we can make payments of
telephone bills. Credit card bills or loan installments.
Electronic Fund Transfer. Electronic banking, also known as electronic fund
transfer (EFT), uses computer and electronic technology as a substitute for
checks and other paper transactions. EFTs is initiated through devices like
cards or codes that let you, or those you authorize, access your account. Many
financial institutions use ATM or debit cards and Personal Identification
Numbers (PINs) for this purpose.
7. Mobile Banking: Mobile banking is a term used for performing balance checks,
account transactions, payments, credit applications etc. via a mobile device such as a
mobile phone or Personal Digital Assistant (PDA).
Table 3(a) Respondents Views Regarding Ranking of Effective Methods Adopting
Green Banking.
S. No
Methods
of
Green 1
Total
Banking
1.
24
12
17
14
20
100
2.
Paperless Statements
14
28
11
12
15
17
100
3.
19
20
17
26
11
100
4.
19
21
29
15
100
5.
13
17
30
100
650
Cards
6.
Net Banking
31
12
18
24
100
7.
Mobile Banking
33
21
16
11
10
100
79
66
57
50
43
34
22
100
Table 3(b) Garrets Ranking Regarding Adopting effective methods of Green Banking
S.No
Methods of Green 1
Banking
Garret
Aver
Ran
Total
age
Value
1.
Online
Saving 632
1584
684
250
731
476
440
4797
47.97
VIth
Account
2.
Paperless Statement
1106
198
1596
550
516
510
374
4850
48.50
Vth
3.
1501
66
1140
850
1118
204
242
5121
51.21
III rd
4.
474
1254
114
1050
344
986
330
4552
45.52
Vth
5.
198
741
250
731
1020
198
4955
49.55
IVth
Credit Cards
6.
Net Banking
2449
594
57
600
774
170
528
5172
51.72
IInd
7.
Mobile Banking
2607
198
1197
800
473
204
220
5699
56.99
Ist
Table 3(b) reveals that on-line saving account has been rated as effective method of
green banking by setting up direct deposits to receive pay checks, receiving electronic
statements from your bank and by paying bills online. On-line banking is the second
preferred method to bank green and help the environment by possessing on internet banking
ID and a password provided by the bank in which the individual customers has an account.
Direct deposits have been rated as third important method of green banking as this will speed
up the availability of money, save paper and paper work. Reward debit and credit cards can
be created by banks in the form of small charitable donations as a percentage of online banking activity to help the environment.
CONCLUSION
India's growth account and obligation to cut its carbon intensity by 20-25 percent from 2005
levels by 2020 provides tremendous opportunities for Indian banks from funding sustainable
projects to offering innovative products and services in the areas of green banking. Initially,
these commitments to environmental and social guidelines will cause a huge financial burden
for Indian banks. For effective green banking, the RBI and the Indian government should
play a pro active role and formulate a green policy guidelines and financial incentives. The
survival of the banking industry is inversely proportional to the level of global warming.
Therefore, for sustainable banking, Indian bank should adopt green banking as a business
model without any additional postponement.
BIBLIOGRAPHY
1. www.foxbusiness.com
2. www.greenbank.com
3. www.infocrystal.com
4. www.moneyrates.com
5. www.scribd.com
6. www.wikipedia.org
7. www.investorwords.com
652
8. "The Indian Banker", monthly journal published by Indian Banks Association edition
February 2010.
9. "The Indian Banker", monthly journal published by Indian Banks Association edition
May 2010.
10. www.rbi.org.in
11. www.iegindia.org
12. www.hdfcbank.com
653
Kritika Dadheech
Assistant Professor
Department of Management Studies
Dr. Ambedkar Institute of Management Studies, Bangalore
Abstract
When the walls came down and windows went up, was the time when the world was
getting flattened. In this era of global competitiveness if a business wants to grow, it
needs to go cross borders. As now everyone is accustomed to buy goods from other
countrieselectronics from Taiwan, vegetables from Mexico, clothing from China, cars from
Korea. Therefore, if we want to survive the business for long run, it is very important to take
the business internationally.
international business, and as global corporations compete to provide superior goods and
services, they initiate change and development in marketplaces. But Managing global
organizations have also been a business challenge for centuries. But the nature of the task is
changing with the accelerating shift of economic activity. For companies, international
business increases competition in domestic markets and opens up new opportunities abroad.
Global competition forces firms to be more innovative and efficient in their use of resources.
Whereas for consumers, international business brings increased varieties of goods and
services into the world marketplace and enhances living standards. Just as important, open
borders means increased exposure to new ideas, technologies, and ways of doing things.
Therefore this paper is an attempt is an to understand how the world is becoming flat and
what are the different challenges and opportunities been faced by the globalized business.
Keywords:business, international, opportunities and challenges.
Introduction:International business relates to any situation where the production or distribution of goods or
services crosses country borders. Globalizationthe shift toward a more interdependent and
654
1. When the walls came down and the windows went up. The fall of the Berlin Wall
ended old-style communism and planned economies. Capitalism ascended.
2. When Netscape went public. Internet browsing and e-mail helped propel the Internet
by making it commercially viable and user friendly.
3. Work-flow software: Lets do lunch. Have your application talk to my
application. With more powerful, easier-to-use software and improved connectivity,
more people can share work. Thus, complex projects with more interdependent parts
can be worked on collaboratively from anywhere.
4. Open-sourcing: Self-organizing, collaborative communities. Providing basic
software online for free gives everyone source code, thus accelerating collaboration
and software development.
5. Outsourcing: Y2K. The Internet lets firms use employees worldwide and send
specific work to the most qualified, cheapest labor, wherever it is. Enter India, with
educated and talented people who work at a fraction of US or European wages. Indian
technicians and software experts built an international reputation during the Y2K
millennium event. The feared computer-system breakdown never happened, but the
Indian IT industry began handling e-commerce and related businesses worldwide.
6. Offshoring: Running with gazelles, eating with lions. When it comes to jobs
leaving and factories being built in cheaper places, people think of China, Malaysia,
Thailand, Mexico, Ireland, Brazil, and Vietnam. But going offshore isnt just moving
part of a manufacturing or service process. It means creating a new business model to
make more goods for non-US sale, thus increasing US exports.
7. Supply-chaining: Wal-Mart demonstrates that improved acquisition and distribution
can lower costs and make suppliers boost quality.
8. Insourcing: What the guys in funny brown shorts are really doing. This kind of
service collaboration happens when firms devise new service combinations to
improve service. Take United Parcel Service (UPS). The brown company delivers
packages globally, but it also repairs Toshiba computers and organizes delivery routes
656
for Papa Johns pizza. With insourcing, UPS uses its logistics expertise to help clients
create new businesses.
9. Informing: Google, Yahoo!, MSN Web Search. Google revolutionized information
searching. Its users conduct some one billion searches annually. This search
methodology and the wide access to knowledge on the Internet transforms
information into a commodity people can use to spawn entirely new businesses.
10. The steroids: Digital, mobile, personal, and virtual. Technological advances range
from wireless communication to processing, resulting in extremely powerful
computing capability and transmission.
These ten factors had powerful roles in making the world smaller, but each worked in
isolation until, Freidman writes, the convergence of three more powerful forces: (1) new
software and increased public familiarity with the Internet, (2) the incorporation of that
knowledge into business and personal communication, and (3) the market influx of billions of
people from Asia and the former Soviet Union who want to become more prosperousfast.
Converging, these factors generated their own critical mass. The benefits of each event
became greater as it merged with another event. Increased global collaboration by talented
people without regard to geographic boundaries, language, or time zones created opportunity
for billions of people.
International business professor Pankaj Ghemawat takes strong issue with the view that the
world is flat and instead espouses a world he characterizes as semiglobalized and
multidomestic. If the world were flat, international business and global strategy would be
easy. According to Ghemawat, it would be domestic strategy applied to a bigger market. In
the semiglobalized world, however, global strategy begins with noticing national
differences.[Pankaj Ghemawat, Distance Still Matters, Harvard Business Review 79, no. 8
(2001): 13747].Ghemawats research suggests that to study barriers to cross-border
economic activity you will use a CAGE analysis. The CAGE framework covers these
four factors: [Pankaj Ghemawat, Distance Still Matters, Harvard Business Review 79, no. 8
(2001): 13747].
1. Culture. Generally, cultural differences between two countries reduce their economic
exchange. Culture refers to a peoples norms, common beliefs, and practices. Cultural
distance refers to differences based in language, norms, national or ethnic identity, levels of
trust, tolerance, respect for entrepreneurship and social networks, or other country-specific
qualities.
657
2. Administration. Bilateral trade flows show that administratively similar countries trade
much more with each other. Administrative distance refers to historical governmental ties,
such as those between India and the United Kingdom. This makes sense; they have the same
sorts of laws, regulations, institutions, and policies. Membership in the same trading block is
also a key similarity. Conversely, the greater the administrative differences between nations,
the more difficult the trading relationshipwhether at the national or corporate level. It can
also refer simply to the level and nature of government involvement in one industry versus
another. Farming, for instance, is subsidized in many countries, and this creates similar
conditions.
3. Geography. This is perhaps the most obvious difference between countries. We can see
that the market for a product in Los Angeles is separated from the market for that same
product in Singapore by thousands of miles. Generally, as distance goes up, trade goes down,
since distance usually increases the cost of transportation. Geographic differences also
include time zones, access to ocean ports, shared borders, topography, and climate.
4. Economics. Economic distance refers to differences in demographic and socioeconomic
conditions. The most obvious economic difference between countries is size (as compared by
gross domestic product, or GDP). Another is per capita income. This distance is likely to
have the greatest effect when (1) the nature of demand varies with income level, (2)
economies of scale are limited, (3) cost differences are significant, (4) the distribution or
business systems are different, or (5) organizations have to be highly responsive to their
customers concerns. Disassembling a companys economy reveals other differences, such as
labor costs, capital costs, human capital (e.g., education or skills), land value, cheap natural
resources, transportation networks, communication infrastructure, and access to capital.
Major Challenges of International Business:1. Integrity. Business has never faced the type of moral challenges that it faces in todays
global economy. Everyone is struggling to be more successful, to make the next quarterly
earnings estimate, to keep their job, to earn a big bonus, or to compete effectively. Many
business employees and executives succumb. These practices erode the trust that needs to
exist between employers and employees, between business partners, between executives and
shareholders. Without trust, the business will not be able to compete effectively and it will
eventually fail.
2. Cash, Borrowing, and Resource Management. Cash is King! Weve all heard this
658
maxim and it is more true today than ever before. A healthy profit may look nice on your
financial statements, but if capital expenditures or receivable collections are draining your
cash, you wont be able to stay in business for long. Too often executives and small business
owners fail to focus enough on cash flow generation. In order to head off this problem,
businesses must either be adequately capitalized and must shore up cash reserves to meet all
obligations as they are needed and to handle downturns and emergencies that may arise.
3. Increased selection and competition. Its never been easier to start a business. Gone are
the days when it took weeks, months, and a myriad of forms to get your business started.
Now if you can buy a domain name and register your business online, youre in business.
However, staying in business is a much more complicated matter. While business expertise
was once an expensive and time consuming endeavor, you can now find experts online for
many questions that you might encounter.
4. Marketing and Customer Loyalty. Along the same lines as increased selection and
competition is the challenge to market to potential customers effectively and retain your
existing customers. Smartphones, social media, texting, email, twitter and other
communication channels are making it easy for businesses and individuals to get their
messages out. Figuring out the right marketing channels is key for businesses to be
successful in the future.
5. Uncertainty. Business leaders find great discomfort in uncertainty. Because of global debt
and economic struggles, uncertainty is more pronounced today than in the past. The sad news
is that uncertainty leads to a short-term focus. Due to uncertainty, companies tend to shy
away from long-term planning in favor of shorter-term goals.
6. Problem Solving and Risk Management. A major challenge for all companies is
identifying, assessing, and mitigating risks, including human and financial capital, in addition
to the macro economy. The lack of a sophisticated problem-solving competency among
todays business leaders is limiting their ability to adequately deal with risks facing their
businesses. This is why corporate managers tend to jump from one fire to another, depending
on which one their executives are trying to put out, and in many cases the fast-changing
business environment is what ignites these fires.
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7. Finding the right staff. Without exception, every business executive says that one of their
biggest challenges is staff finding the right staff, retaining them, and ensuring they buy into
the vision of the business. In fact, if someone could develop a formula for recruiting and
engaging the right team members, they would make millions. A small business is almost like
a family, and, like many families, they can work well, or they can be dysfunctional.
Opportunities in International Business:The fact that nations exchange billions of dollars in goods and services each year
demonstrates that international trade makes good economic sense. For an American company
wishing to expand beyond national borders, there are a variety of ways it can get involved in
international business. Lets take a closer look at the more popular ones.
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1. IMPORTING
AND
THEM IN ONES OWN COUNTRY) AND EXPORTING (SELLING DOMESTIC PRODUCTS TO FOREIGN
CUSTOMERS) ARE THE OLDEST AND MOST PREVALENT FORMS OF INTERNATIONAL TRADE.
FOR
MANY COMPANIES, IMPORTING IS THE PRIMARY LINK TO THE GLOBAL MARKET. AMERICAN FOOD
AND BEVERAGE WHOLESALERS, FOR INSTANCE, IMPORT THE BOTTLED WATER
MARKET QUICKLY WHILE TAKING ONLY LIMITED FINANCIAL AND LEGAL RISKS MIGHT CONSIDER
LICENSING
AGREEMENTS
WITH
FOREIGN
(THE LICENSOR)
COMPANIES.
(THE LICENSEE)
AN INTERNATIONAL
ANOTHER
LICENSING
(SUCH
HERES
AS PATENTS,
HOW IT WORKS:
(THE FRANCHISER)
UNDER
GRANTS A
FOREIGN COMPANY (THE FRANCHISEE) THE RIGHT TO USE ITS BRAND NAME AND TO SELL ITS
PRODUCTS OR SERVICES.
3. CONTRACT MANUFACTURING
COSTS, MANY
COSTS
ARE
AND
OUTSOURCING:-BECAUSE
THIS
ARRANGEMENT
MANUFACTURING OR OUTSOURCING.
A U.S.
IS
CALLEDINTERNATIONAL
CONTRACT
4. STRATEGIC ALLIANCES
AND JOINT
VENTURES: - A STRATEGIC
ALLIANCE IS AN AGREEMENT
BETWEEN TWO COMPANIES (OR A COMPANY AND A NATION) TO POOL RESOURCES IN ORDER TO
ACHIEVE BUSINESS GOALS THAT BENEFIT BOTH PARTNERS.
Improving products
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Sharing technology
Conclusion
Therefore the impact of the faster growth on living standards has been phenomenal. It has
been observed that there has beena well-being of a larger percentage of the worlds
population by a greater increment than ever before in history. Growing incomes give people
the ability to spend on things other than basic food and shelter, in particular on things such as
education and health. This ability, combined with the sharing among nations of medical and
scientific advances, has transformed life in many parts of the developing world. Its easy to
think that trade is just about business interests in each country. But global trade is much
more. Theres a convergence and, at times, a conflict of the interests of the different
stakeholdersfrom businesses to governments to local citizens. In recent years,
advancements in technology, a renewed enthusiasm for entrepreneurship, and a global
sentiment that favors free trade have further connected people, businesses, and marketsall
flatteners that are helping expand global trade and investment.
References:1. http://2012books.lardbucket.org/books/challenges-and-opportunities-in-internationalbusiness/index.html
2. "Business Education Standards". National
4. Journal of International Business Studies Vol. 41, No. 1 - Vol. 43, No. 2,2010-2012
5. Albrow, Martin. 1997. The Global Age: State and Society Beyond Modernity.
Stanford: Stanford University Press.
6. Amsden, Alice. 1989. Asias Next Giant: South Koreas Late Industrialization. New
York: Oxford.
7. Anderson, Benedict. 1991. Imagined Communities. London, New York: Verso.
8. Barnet, Richard J., John Cavanaugh. 1994. Global Dreams. New York: Simon and
Schuster. Beck, Ulrich. 1992. Risk Society: Towards a New Modernity. London:
Sage.
9. Black, Richard and Vaughan Robinson, Eds. 1993. Geography and Refugees: Patterns
and Processes of Change. London and New York: Belhaven Press.
10. Brecher, Jeremy, and Tim Costello. 1994. Global Village or Global Pillage?
Economic Reconstruction from the Bottom Up. Boston: South End Press.
11. Calhoun, Craig. 1992. The infrastructure of modernity: Indirect social relationships.
information technology, and social integration. In H. Haferkamp and N.J. Smelser,
eds., Social Change and Modernity, pp.205-236. Berkeley: University of California
Press.
12. Chase-Dunn, Christopher and Thomas D. Hall. 1997. Rise and Demise: Comparing
World-Systems. Boulder, CO: Westview Press.
13. Commission on Global Governance. 1995. Our Global Neighborhood: The Report of
the Commission on Global Governance. Oxford and New York: Oxford University
Press.
14. http://catalog.flatworldknowledge.com/bookhub/7?e=collins-ch03_s02
15. http://www.ibtimes.com/international-business-opportunities-trends-top-countriesconsider-214068
663
MRS. BHARATHY,
ASSISTANT PROFESSOR
DEPT. OF MANAGEMENT STUDIES,
PONDICHERRY UNIVERSITY COMMUNITY COLLEGE
BHARATHYRANGAN@GMAIL.COM
INTRODUCTION
In recent years, social media has become ubiquitous and important for social
networking and content sharing. Social Media (SM) has exploded as a category of online
discourse where people create content, share it, bookmark it and network at a prodigious rate.
No doubt, it is a subject of extensive discussion in publications and forums in recent years.
This further manifests from its power to spread information and engage consumers in the
virtual world. No wonder, on July 19, 2012 Ratan Tata decided to bypass the traditional mode
of communication in favour of a more contemporary medium micro blogging site Twitter.
The 75 year old Tata attached a four para-note to post on the six year young 140 character
social media vehicle, in which he makes a plea to stop blaming the prime minister for the
slowdown in economic growth. Tata decided against the tried and tested way of conveying
his message the media release - and chose Twitter instead. By firing this missive to 285,000
odd followers on Twitter 635 of whom had retweeted Tatas entreaty at the time of writing
the chairman of Tata sons achieved plenty at a stroke. Not only did he bypass the PR
wagon, he sidestepped the next link on the communication trail traditional media ( print ,
television and their online progeny ). Tata was not only the subject of news; he broke it
himself.
Another exemplary demonstration of social media was visible in the very recent
controversy of banning Maggi in India and how the company is facing the ban period through
social media. When the Maggi ban was first heard of, social media went buzzing with
hilarious memes as well as genuine queries from consumers. According to an analysis done
by Simplify360, it was found that the general tone of the posts on the social media sites, tend
to suggest a high degree of disbelief and hurt that a trusted brand would stray from the path.
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Topics like #Maggiban, #MaggiInasoup kept on trending for weeks. The Exhibit: 1 shows the
post on June 4, 2015 by the company trying to explain to the consumers what they need to
know about Maggi. And on June 5th, the global head of Nestle decided to withdraw all the
variants of Maggi from India, citing that the current scenario is not conducive for the brand.
Even though, the last post on the Facebook page of Maggi was on June 5th, the brand is
making an effort to reply to each query posted on its wall with a reply like We have engaged
with authorities and are trying our best to come back soon . There is also a Facebook page
titled We Support Maggi made by the diehard fans and they refuse to believe that their
favourite Maggi is unsafe for consumption. In spite of the ban, there are reports that, Maggi is
now available in the black market, a single packet of Maggi (Rs 10) is being sold for Rs 102.
Indeed over the past couple of years , social media sites like Twitter has earned its
spurs for its ability to get the big news first. A royal wedding (Prince William and Kate
Middleton), campaigns of US presidential candidates (Barack Obama and Newt Gingrich)
and the extermination of a terrorist (Osama Bin Laden) were all put out first on Twitter.
Business leaders Richard Branson to Vijay Mallya and Anand Mahindra are using the service
to build brands and interact with consumers of their products and services. These lead the
way for social networking sites going viral among new generation of consumers. This can be
explained by the unprecedented internet diffusion India has been witnessing in the last
decade. Over the last three years alone, internet usage in India has increased from 100 200
million people. It has the third largest internet population after China & US and is projected
to be second largest by 2015 with 330 370 million users( Comscore,2013).The increase has
taken place not only among the urban but also amongst the rural Indian population.
Leveraging on the internet diffusion and the growing online activity time spent by
web users on social networking sites more than on the other services has created a new buzz
area in marketing that consumers and businesses are utilizing to engage, communicate and
build relationships with each other. Facebook, Twitter, LinkedIn, YouTube and other social
media platforms are today a part of everyday life. Top social media networking sites are
Facebook, LinkedIn, Twitter, BharatStudent.com, Zedge.net, Ibibo.com, hi5.com, Shtyle.fm,
Indyarocks, Fropper.com and Myspace.com. It is being seen that the social media-savvy
organizations in India use the medium to build communities and advocate usage while some
use social media as a platform to highlight brand news. Organizations are also increasingly
using social media for both the above reasons and also use it for customer service, lead
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generation, and research indicating high social maturity and moving toward getting business
meanings out of engagements.
Given the high frequency of adherence displayed by people on social media
according to Statistic Brain, there are 9,100 tweets sent per second no wonder it is indeed
tempting to reach out to this clientele as often as possible. Brands ranging from FMCG,
apparel, automotive, travel to the film and television industry are using the social media
marketing tool to drive purchase behavior of consumers. LOreal Paris Indias - stay rooted
campaign for the promotion of its latest hair fall repair shampoo, movies like Lootera , Bhag
Milka Bhags promotions using vintage filters to fans images, MTV Philips MPowerpack
challenge, Tata Nanos celebrate awesomeness- awesome attitude of the young generation
owing nano , Bournvita Quiz contest on social media, Cadbury celebrations songs for
sisters on Raksha Bandhan, BMW, Pizza Hut and the list goes on.. The rise in the social
media campaigns signals the evolution of social media in India. Companies large and small
have developed active Twitter and Face book profiles, their ability to interact directly with
their client base has reached high levels. A majority of social media savvy organizations
popularly practice activities on social media as follows:
Type of content - Post generic updates instead of brand updates.
Frequency of updates and responses- Social media-savvy organizations posts multiple
updates a day. Majority of social media-savvy organizations respond to fan queries within 30
to 60 minutes on Twitter and within 30 minutes to a few hours on Facebook.
Contests/promotions: Picture contests are the most popular contests among social mediasavvy organizations in India most contests are organized monthly.
Policies: Majority of social media-savvy organizations in India surveyed have social media
guidelines for better governance and online monitoring programs to listen to conversations;
however, less than half have crisis manuals.
Tools used: Many social media-savvy organizations in India use tools for online monitoring,
response management, or managing social media platforms.
Social media for research: Almost half of the social media-savvy organizations in India have
conducted research using social media tools to get customer feedback and understand more
about customer behavior.
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Mobile: Half of the social media-savvy organizations in India have created mobile phone
apps and one-fourth plans to create one.
Further social media encompasses a wide range of online word of mouth forums
including blogs , company sponsored discussion boards and chat rooms, consumer to
consumer e-mail, consumer product or service rating websites and forums, moblogs (sites
containing digital audio, images, movies, or photographs) and social networking websites just
to name a few.
Thus the 21st century consumers are witnessing an explosion of internet based messages
transmitted through the various forms of social media. They serve as major influencers of
consumer buying behavior at all levels of the consumers quest to search for information,
evaluation of information, purchase behavior and post purchase communication and
evaluation. It is evolving as a hybrid component of the promotional mix and therefore seeks
to be incorporated into an organizations Integrated Marketing Communication strategy.
BACKGROUND & SPECIFIC ISSUES
Definition of Social Media (SM):
SM can be briefly defined as web application tools that allow users to publish and
broadcast content in order to open and invite participation in conversations. From the amount
of commentary on SM it seems to be a very dynamic ecosystem (Safko & Brake, 2009)
where marketing and advertising people have found a new opportunity: it provides an active
conversation between the brand/business and its customers. The most attractive element of
this channel is the potential for interactivity. It is more broadly explained as a set of webbased media tools, similar to offline media that allow people to interact by generating and
broadcasting their own content with the means to socialize and/or share information of
interests through the internet. The content can be of personal, professional or commercial
character (Wendy Tapia, 2010).
The Rise in the types of Social Media:
There is a vast list of social media tools available and a few are briefly mentioned to
get an overview of its diverse applications. The internet provides with a wide range of web
applications that are similar to traditional media and the main categories can be established as
Publish, Photo, Audio, Video, Livecasting, Virtual Worlds, Gaming, Productivity
Applications, Aggregators, RSS, Search, Mobile and Interpersonal, Microblogging and
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Social Networks (Safko & Brake, 2009, pp. 25-32) Publish refers to the sites that allow users
to publish and distribute information to audiences. A good example of it is email. Other
similar publish tools are: Blogs like Blogger , Presentation Sharers like SlideShare , Content
Hubs like Wikia , Open Content Encyclopedia like Wikipedia (Safko & Brake, 2009, pp. 472491).The photo category of social media refers to sites that allow users to sort, organize and
share photos. Sites that are mentioned as examples are: Flickr, Photobucket, Picasa,
Randar.net ,Slide, SmugMug, Twitxr, Zoomr. The audio category tools allow users to upload,
download, and share audio content. Examples include: iTunes, PodBean, Podcast.net, and
Rhapsody (Safko & Brake, 2009, pp. 493-517) , the video tool allows users to share video
content. Some examples of it are: Brightcove,Google Video, Hulu, Metacafe, Viddler, and
YouTube , A similar function is provided by Livecasting tools which enable users to
broadcast live video and audio streams to the network. The most common sites are:
BlogTalkRadio, Live 365, Justin.tv, SHOUTcast, and TalkShoe.(Safko & Brake, 2009, pp.
519-549) , Virtual Worlds facilitate users interaction in real time. Some examples are: Active
Worlds, Kaneva, Second Life, There, and ViOS.
Gaming is also seen as a strong tool to generate word of mouth by providing with
games, such as:4x4 Evolution, Entropia Universe, EverQuest,World of Warcraft , (Safko &
Brake, 2009, pp. 551-569) , in the Productivity Applications there is a range of tools that can
be used by businesses due to their functionality and productivity nature. Some applications
include: Acteva, AOL, Survey Monkey, Google Alerts, Google Docs, and Zoho (Safko &
Brake, 2009, pp. 571-598 , Aggregators are the next category and refer to sites that keep track
of internet contributions, some examples of this are: Digg, FriendFeed, iGoogle, My Yahoo,
and Google Reader ,RSS on the other hand refers to the acronym Rich Site Summary and it
is a feeder of current content from different websites. Some examples of it are: Atom,
FeedBurner, PingShot, and RSS 2.0 (Safko & Brake, 2009, pp. 599-622) , Search refers in
this case to Search Engines which allow users to search and locate content by typing words or
sentences. Few examples are: EveryZing, Google Search, MetaTube, and Yahoo! Search.
Another set of promising tools reviewed mobile enabled tools which facilitates users to use
their services on portable devices. The sites mentioned are: CallWave, SMS.ac, AOL Mobile
and Jott (Safko & Brake, 2009, pp. 623-653) as well as mobile versions of a number of the
previous tools and sites mentioned. People-to-people communication tools facilities the
interpersonal activity by allowing communication and contributions between users, some
examples are: Go To Meeting, Meebo, Skype, AOL Instant Messenger, and Apple iChat
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(Safko & Brake, 2009, pp. 656-670).There is surely a need to identify social media platforms
to use that will meet the required marketing objectives and purposes of a particular
organisation (kallmeyer & Abratt, ) ;(Hughes & Fill, );Chung & Austria, );Weinberg &
Pehlivan, ).
Studies also reveal that consumers are increasingly embracing the social media
communications and are turning away from the traditional media namely the electronic and
the print media as they demand a greater control over the media and require instant access to
information at their own convenience (Rashtchy et al., 2007; Vollmer & Pre Court ,
2008).This indeed is seen from the consumers preference of the various social media to
conduct their information search relating to their purchase decision process(Lempert,
2006;Vollmer & Precourt, 2008).The shift in consumer buying behaviour and decision
making informational gathering from traditional media to online sources is driving the need
for new consumer perceptions to be made (Michelle Dateling & Geoffrey Bick, 2013).
This leads to Specific Issue 1: What types of social media are perceived to be applicable to
our businesses based on consumer traffic?
Points to Discuss: This indeed is the challenge of the social media age, let alone digital
age either. The best companies use a culture of collaboration, people-centricity, listening to
internal and external stakeholders and acting upon it. Its more of an involvement by the
organisation. Just asking customer experience and conversion experts, who have always
known that the best strategies involved the people that mattered (including customers) instead
of relying on the famous HiPPO (Highest Paid Persons Opinion) and the ivory towers of the
self-absorbed organization. Whatever the area of business or operation you want to improve:
getting all stakeholders and socializing the decision and strategy making process is key.
Also, while many marketers debate what comes first, content, social media or SEO, the most
practical approach is to use the tactics necessary for your target audience in order to be the
best answer wherever customers are looking. This then calls for scanning where aour
customers are?
are: firstly, the market size and growth that social network sites represent (see Table 1);
secondly, a perception of urgency; and thirdly many examples that illustrate the power of
online word-of-mouth.
India has 3rd largest internet population after China & US, it is projected to be 2nd
largest by 2015 with 330-370 million users.
Indian digital sector is on the rise with 31% CAGR as opposed to other media.
Internet user distribution is about 137 million among urban community and 68 million
among rural community. It shows a 585 year on year growth of rural internet users.
The top cities by internet penetration are Mumbai, Delhi & Hyderabad.
There are 33 million Twitter users, 90 million Facebook users, 18 million linkedIn
users.
Indian online advertising market is projected to reach INR 2938 crores by March
2014.
In the case of perception of emergency in using social media as marketing tool that
belongs to the marketing communications mix under the element of promotion. (Mangold
and Faulds,2009) consider social media to be a hybrid element of the promotion mix in that it
combines some of the characteristics of
670
to tell 10 million consumers virtually overnight ((Mangold and Faulds, 2009).With the
current marketing emphasis on developing relationships and retaining customers , there has
been a progression in understanding of communication theory in that the panoply of
organisations , products and services are now being differentiated by how well they listen,
consider, educate and relate to their consumers. Consumers are becoming part of the
conversation (Hughes & Fill,). Successful implementation strategies require three elements:
mindful adoption, community building and absorptive capacity (Culnan, Mc Hugh &
Zubillaga,). The shift in consumer behaviour and decision making informational gathering
from traditional media to on line sources is driving the need for new consumer perceptions to
be made. Steve Goldner a digital and social marketing executive consultant feels it important
to know your target audience well and have deep empathy for them by listening to them on
social channels not just our own (Mike Thompson). Informational society influences affects
the consumer decision processes and product evaluations. Social media provides a new
channel to acquire product information through peer communication, (Kozinets, 1999)
In the case of social media, the enormity and high variance of the information that
propagates through large user communities presents an interesting opportunity for harnessing
that data into a form that allows for specific predictions about particular outcomes, without
having to institute market mechanisms. One can also build models to aggregate the opinions
of the collective population and gain useful insights into their behavior, while predicting
future trends. Moreover, gathering information on how people converse regarding particular
products can be helpful when designing marketing and advertising campaigns.
Unfortunately, the popular business press and academic literature offers marketing
managers very little guidance for incorporating social media into their IMC strategies.
Therefore many managers lack a full appreciation for the social medias role in the
companys promotional efforts (Mangold & Faulds, 2009).
This leads us to Specific Issue 2: What is the extent of participation of consumers in the
social media / marketing communications interactions that predict consumer behavior?
Point to Discuss: This would help us to determine whether social media can be considered as
a hybrid element of the promotional mix. As it seems that a social media managers job is
never done. It doesnt matter what time of day or day of week youre in, theres always more
to do. Social media is moving at an astronomical pace, and it can be hard to keep up.
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The industry is coming together on best practices and organizations are evolving their
structures to include roles like Chief Content Officer, Chief Tweet Officer and Brand
Journalist.
In fact, research has found that the top two barriers impeding adoption of social business
within organizations are lack of overall strategy and competing priorities.
Social Media user behaviour:
In todays digital world the pervasiveness of social media is undisputable when we
look at our own daily web behaviour how many times we googled for answers to a
question, checked twitter messages to see what is new , logged into Facebook to keep our
timeline updated. One key issue to be considered by marketers here is surely understanding
how digital and social media influence purchase decision process. Questions like how and
when people turn to social media as a tool for helping them manage their product and service
purchases? Do they get purchase ideas from routine online activities? Do they use social
media to expand and contract their brand consideration sets? Do they turn to family and
friends on social networks to get insights from the post purchase experience? And how do
these answers differ by audience, purchase category, and by need state? Social media has also
influenced consumer behavior from information acquisition to post-purchase behavior such
as dissatisfaction statements or behaviors about a product or a company. (Mangold and
Faulds, 2009). Online groups exert a noticeable influence on the behavior and consumer
buying intent and implicitly on the purchase decision. For example, social media websites
provide a public forum that gives individual consumers their own voice; as well access to
product information that facilitates their purchase decisions (Kozinets et al., 2010).
Another area in which evolution is foreseen is the value of participation in the
communication of the brand. It is argued that a stronger emphasis on the emotional rewards
of participation in brand building may bolster the degree of involvement in the process and
vice versa (Maria Vernuccio, 2014).Consumers today do not need more information; they
need help making sense of it all(Todd Powers et al, 2012).
Finally from the beginning it is important to understand the culture in which social
media exist. Todays consumers are more empowered than ever before; social networking,
blogging and the availability of digital devices such as tablets and smart phones allow
consumers to connect with one another, discuss brands and products and interact with brands
672
quickly and easily. Hence brands are using tactics that are relevant to their consumers and
also integrate these with their tradition media plans.
This leads us to Specific Issue 3: What is the extent to which social media have affected the
attitudes and behaviour of a larger population of consumers, underlying that, social networks
and blogs are the foremost online destination?
Point to discuss: At this junction, we observe that the reality may not always meet the
expectation, there are many benefits to incorporating social media into our digital marketing
routine. According to Social Media Examiners latest report, these benefits include:
Increased exposure
Lead generation
CONCLUSION
Thus collectively the major objectives of this case is to deliberate on the specific
issues identified based on extensive literature review undertaken by the rsearcher.The
answers to these questions will help identify the types of social media that are perceived to be
applicable to our businesses based on consumer traffic in the sector as chosen, To evaluate
the role of social media as a tool in promotional element of marketing mix communications,
To analyse the social media user habits and to suggest strategies for organisations based on
the social media usage and user habits. However the case study discussion will be limited to
the social network sites (SNS) Facebook and Twitter.
Exhibits: 1 (Posted on Meri Maggi page on June 4, 2015)
Dear fans, all your questions on the MAGGI Noodles issue have been answered
here http://bit.ly/1Fs6xVx. Please share this with your friends & family.
673
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TESTING THE EFFICIENT MARKET HYPOTHESIS (EMH) IN INDIAN CAPITAL MARKET- A STUDY WITH
SPECIAL REFERENCE TO FMCG COMPANIES
1. DR.M.RAJA (AUTHOR)
ASSISTANT PROFESSOR& HEAD, DEPARTMENT OF COMMERCE,
BHARATHIDASAN UNIVERSITY CONSTITUENT COLLEGE, LALGUDI,
TIRUCHIRAPPALLI -621 601, INDIA
Testing the Efficient Market Hypothesis (EMH) in Indian Capital Market- A Study with Special
Reference to FMCG Companies
ABSTRACT
An efficient and integrated Capital Market is an important infrastructure that facilitates capital
formation, which is possible only if the securities traded in the markets are priced appropriately. The
efficiency with which the capital formation is carried out depends on the efficiency of the capital
markets and financial institutions. A capital market is said to be efficient with respect to an
information item if the prices of securities fully impound the returns implications of that item. This
study has empirically examined the informational efficiency of capital market with regard to
quarterly earnings released by the FMCG companies in the semi-strong form of EMH. The paper is
organized into five sections. Section I deals with introduction Section II reviews some select
literature relevant for the study, the data and methodology are described in section III, the results
are discussed in section IV, and section V summaries the findings and concludes the paper. The study
found that the Indian Capital market is not perfectly efficient in the semi- strong form of EMH, which
can be used by the investors to make abnormal returns.
677
Testing the Semi- Srong Form Efficiency of Indian Capital Market- A Study with special Reference
to Fast Moving Consumer Goods (FMCG) Industries
I. Introduction
Introduction
A capital market is said to be efficient with respect to an information item if the prices of
securities fully impound the return implications of that item. In an efficient market, when a new
information item is added to the market, its revaluation implications for security returns are
instantaneously and unbiasedly impounded in the current market price. Several studies have
empirically tested the reaction of security prices to the release of different information. One major
source of information that the investors can make use for valuation of securities is accounting
information. Accounting information and capital market efficiency are of greater interest to the
investors, fund managers, analysts, planners, policy makers, market regulators, accounting standard
setters, researchers, the government, and the public in general. Securities and Exchange Board of
India (SEBI) has made it mandatory for the listed companies to release their half-yearly. This has
come into effect from the financial year 1998-1999. Do these quarterly announcements contain
information relevant for valuation of securities? If so, do the security prices impound the
information rapidly and unbiasedly?
One explanation for market efficiency is the competitive activities of security analysts.
Larger the number of analysts, the more efficient will be the market. Market efficiencies are most
likely for stocks followed by large number of analysts and least likely for stocks with limited coverage
by analysts. The more visible a company, the more perfect its market is likely to be. Perfect
meaning that most of the likely factors affecting the price of its securities are presumably known to
the market. Conversely, the less visible it is to the investing public and the more imperfect the
market price for its securities is likely to be. The FMCG stocks are more visible and highly active in
the Indian capital market during the last decade. The present study testing the Efficient Market
Hypothesis (EMH) with respect to the quarterly earning reports released by FMCG companies.
capital market, Md. Obaidullah (1992), Hari Om Chaturvedi (2000), Prabina Das, S.Srinivasan, and
A.K. Dutta (2000), Kakati (2001), Jijo Lukose and Narayan Rao (2002) are some of the studies, which
have tested the efficiency of the capital market with respect to the release of accounting
information. These studies concludes that there is a very strong reaction at the announcement, the
major portion of which decays within two hours, but with detectable traces that lingers in to the
following day.
Only very few studies have tested the efficiency of the Indian capital market with respect to
Quarterly information. M.Selvam, S.Vanitha and M.Raja (2006) Study the share price reaction to
mergers and acquisitions on Industrial Credit Investment Corporation of India Bank (ICICI Bank) and
found that there is no difference in the security price behaviour of ICICI Bank around Merger and
acquisition announcement. M.Selvam and M.Raja (2008) examined the impact of terrorism on Asian
Stock Market and they found that among the asisan stock market, Indian stock markets are more
resilient than in the pastand they recovered sooner from the terrorist attacks than other Asian stock
market. M.Raja and J.Clement Sudhahar (2008) testing the market efficiency of Nifty Futures: A
random walk hypothesis approach found that the stock futures of the majority of the forms under
nidty index has followed random walk and exposed the weak form efficiency in the market. M.Raja,
J.Clement Sudhahar and M.Selvam (2009) testing the semi-strong form efficiency of Indian stock
market with respect to information content of stock split announcement with Information
technology companies found that the security prices reacted to the announcement of stock splits,
indian stock market with respect of information technology companies in general are efficient, but
not perfectly efficient to the announcement of stock split. M.Raja, J.Clement Sudhahar and
M.Selvam (2009) testing the informational efficiency of Indian capital market with respect to
buyback announcement by IT companies found that the buyback announcement contained
informationare useful for valuing the securities and for buyback announcement the market was
react quickly during post buyback announcement. M.Raja, J.Clement Sudhahar and M.Selvam (2009)
testing the efficiency of Indian stock market with respect to right issue announcement by IT
companies shows that Indian capital market is efficient in the sense that is uses the information
relevant for security valuation and for investment decision making. M. Raja (2010) testing the
efficiency of indian capital market with respect to quarterly announcement by petrochemical
industry found that Indian capital market is not perfectly efficient in the semi-strong from of
efficiency market hypothesis, which can be used by the investors to make abnormal returns. M.Raja
(2010) Testing the information content of dividend announcement by the Indian IT companies found
that Indian capital market is not perfectly efficient in the semi-strong form of EMH, which can be
explited by the investors to make abnormal returns.
The SRV model which has been used in many early studies on the developed markets
indicates the market/security price reaction to information. This model has not been tested on the
Indian capital market. Very few studies have been made in India to test the information content of
quarterly announcement by FMCG companies. Therefore, the present study is an attempt to fill this
gap.
15
679
16
17
18III. DATA AND METHODOLOGY
Objectives of the Study
The main objective of the study is to test the informational efficiency of the Indian capital
market with respect to the quarterly earnings information released by the FMCG companies. The
specific objectives of the study are:
1. To examine the Efficient Market Hypothesis based on quarterly earnings report.
2. To test how quickly and how effectively the information content are captured by the market.
3. To test the direction and magnitude of change in the security prices around the date of
announcement of quarterly earnings.
DATA
The study intends to cover only the FMCG industry stocks listed in the Bombay Stock
Exchange. There are 20 FMCG stocks were considered for the study. The criteria for selecting the
sample were active trading, and availability of the dates of announcement of quarterly earnings and
the availability of quarterly earnings information. Active trading is considered in order to ensure the
availability of daily prices. The study uses daily share price adjusted for dividends, bonus issues,
stock splits and consolidation for calculating return. The study covers five accounting years from
2010 to 2014.
19METHODOLOGY
Security return variability (SRV) and Cumulative abnormal return (CAR) models have used for
analyzing the reaction of security prices to the announcement of quarterly earnings. The daily
returns on each security in the sample were calculated using the daily prices adjusted for dividends,
bonus issues, rights issues, stock splits and stock consolidations, using equation 1, as follows:
Ri ,t
Pt Pt 1
100 - - - - - - - - - - - - ----------------------------------------- - - (1)
Pt 1
Equation 1 was used to calculate the return from the market index too.
In order to examine the reaction security prices and the information content of quarterly
earnings report, the Security Return Variability model is used. The model is,
SRVi ,t
ARi2,t
V ( ARi ,t )
---------------------------------------------------------------------- (2)
The significance of reaction in prices is tested using the t-test. The t-statistic is calculated as,
t stat
ASRVi ,t 1
S
-------------------------------------------------------- (3)
Where n is the number of bonus announcment in the sample and S is the standard deviation of SRV.
Abnormal Return
The sign of the abnormal return, which shows the direction of security price movement to
the reported earnings change and the magnitude of abnormal return, are calculated for study
period. Abnormal returns were calculated based on Sensex adjusted return, Mean adjusted return,
CAPM adjusted return.
Abnormal return under Risk Adjusted Return were calculated using capital Asset Pricing
Model (CAPM) as follows
Ri
Where Rf
Rm
= Market return
= Covim / m2
681
m2
Beta for one year preceding the announcement period were calculated and taken as beta for
calculating return under CAPM for the same announcement period.
ARi ,t Ri ,t Rm,t
----------------------------------------------------------------- - - (5)
Whereby daily return over the 31 day period were adjusted against their mean return.
AAR t
AR
i 1
i ,t
-----------------------------------------------------------------------------------------------------------
(7)
Where, AARt is the average abnormal return on day t and ARi,t is the abnormal return on
security i on day t.
682
t stat
AAR t 0
S
------------------------------------------------------------------------ (8)
The AARt is calculated for the overall positive and overall negative earnings change
categories as well as for the different earnings change categories.
The cumulative abnormal return (CAAR) is calculated to find the magnitude of abnormal
returns for different holding periods and for different quarterly announcements change categories.
It is calculated as
Where, AARt is the average abnormal return of the sample securities at time t
Table-1(column 2) shows that the ASRV based on Sensex adjusted returns react sharply on day 0
and 1. The ASRV on day 0 is 1.39 and on day 1 it is 1.61. This shows that security prices react to the
announcement of quarterly earnings on day 0 and day1. This is clearly depicted in chart 1.1. The
chart shows that the curve is steeply rising on day -14 (1.31) and on day -7 (1.43). The reaction on
these days may be due to anticipation of the quarterly earnings.
Table-1(colum3) show the result of ASRV based on mean adjusted returns. Mean adjusted returns
are the security returns in excess of the mean of returns for three months prior to the
announcement quarterly earnings, of the security. The results show that there is a sharp reaction in
the security prices on day 0 and on day 1. On day 0 the ASRV is 1.46 and on day 1 it is 2.16 with t
statistics 2.76 and 4.25 respectively. The same is depicted in chart 1.2. Table 1.2 and chart 1.2 show
very clearly that the security prices react significantly on day 0 and 1. On all other days around the
announcement of quarterly earnings the value of ASRV is not significant.
Table-1 (column 4) show the result of ASRV based on CAPM adjusted return. The result shows that
during the preannouncement period the ASRV has been significantly greater than 1 on many days.
In general it has been less than 1 during the post announcement period. It is surprising that the
ASRV has been just 1.19 on day 0 and 0.82 on day 1 which shows that there was no reaction in the
security prices on these days. These results are totally contrary to the result shown in table 1.1 and
1.2 Another feature of the ASRV results based on CAPM adjusted returns is that the results in
general are volatile particularly during the pre announcement period.
684
Table-1: Average Security Return Variability (ASRV) around Quarterly Earning Announcement
DAY
ASRV
ASRV
ASRV
t.Stat
t.Stat
t.Stat
-15
1.07
0.43
1.03
0.2
0.91
-0.54
-14
1.31
1.99@
1.3
1.47
1.56
2.09@
-13
1.19
1.12
1.01
0.09
1.38
1.98@
-12
0.91
-0.73
0.93
-0.42
1.2
1.26
-11
0.96
-0.26
0.91
-0.52
1.21
1.09
-10
1.04
0.31
1.06
0.42
1.2
1.02
-9
1.13
0.87
1.12
0.81
0.88
-0.85
-8
0.99
-0.05
1.06
0.44
1.41
2.09@
-7
1.43
2.23@
1.34
1.61
1.39
2.30@
-6
1.06
0.46
0.97
-0.2
1.18
1.36
-5
0.99
-0.08
0.84
-1.31
1.65
2.30@
-4
0.96
-0.32
0.84
-1.48
1.48
1.87@
-3
1.24
1.44
1.25
1.32
1.21
1.14
-2
1.14
0.97
1.03
0.21
1.11
0.74
-1
1.07
0.55
1.21
1.25
1.3
1.76@
1.39
2.28@
1.46
2.76 *
1.19
1.09
1.61
2.75*
2.16
4.25 *
0.82
-1.52
1.16
0.9
1.26
1.54
0.66
-3.71
0.92
-0.76
0.93
-0.59
0.89
-0.90
0.01
1.13
0.78
0.88
-0.82
1.04
0.24
1.05
0.33
0.94
-0.47
1.13
0.96
0.97
-0.25
1.02
0.12
1.09
0.71
1.13
0.95
0.89
-0.71
0.77
-2
0.84
-1.17
0.67
-3.45
685
0.99
-0.08
0.9
-1
0.82
-1.69
10
1.05
0.29
1.03
0.15
0.63
-4.88
11
1.16
1.06
1.36
1.75@
0.74
-3.21
12
1.01
0.06
1.12
0.57
0.67
-4.54
13
0.72
-2.83
0.73
-2.47
0.67
-3.73
14
0.61
-3.78
0.69
-2.6
0.54
-5.74
15
0.91
-0.77
0.94
-0.44
0.59
-6.22
Chart-1: Average Security Return Variability (ASRV) around Quarterly Earning Announcement
2.5
2
Sensex Adj.d
Retetun ASRV
1.5
0.5
0
-15
-12
-9
-6
-3
12
15
returns in general. However, only on day 1 there has been statistically significant positive abnormal
return of 1.21. In general, there is positive abnormal returns during the pre announcement period
and negative returns beyond day 2. Only on day 1 there is significant abnormal returns. This
indicates that the FMCG stocks react on the next day of announcement of quarterly earnings.
Similar results are found in the abnormal returns based on the mean adjusted return. Column 4
shows that there has been positive abnormal return of 0.33%, 0.34 % and 0.77% respectively on days
-1, 0 and 1. On day 1, the abnormal returns have been the highest. Another interesting result to be
noted is that the abnormal returns in excess of Sensex returns has been greater than the abnormal
returns in excess of mean adjusted returns. This shows that the Sensex returns are lower than the
mean return of FMCG stocks. This shows that the risk of FMCG stocks is less than the market and
returns are greater than the market. Hence, the FMCG stocks are performing better than the
market.
DAY
AAR
AAR
AAR
t.Stat
t.Stat
t.Stat
-15
-0.35
-0.95
-0.23
-0.84
0.003
1.637
-14
-0.01
-0.03
0.11
0.4
0.005
2.733*
-13
-1.02
-2.63
-0.15
-0.53
0.004
2.131@
-12
-0.92
-2.45
-0.39
-1.34
0.006
3.113*
-11
0.29
0.72
0.35
1.3
-0.001
-0.056
-10
0.19
0.55
-0.03
-0.1
0.003
1.892@
-9
0.56
1.31
0.52
1.34
-0.004
-0.229
-8
-0.24
-0.55
-0.56
-2.08
0.002
0.835
-7
0.19
-0.37
-0.31
-0.93
-0.006
-0.271
-6
0.5
1.19
0.13
0.37
-0.009
-0.442
-5
0.38
0.96
0.41
1.24
-0.003
-1.488
-4
0.91
2.08@
0.53
1.42
-0.002
-1.208
687
-3
0.24
0.51
-0.06
-0.16
0.008
0.402
-2
-0.16
-0.36
0.25
0.61
-0.002
-1.443
-1
0.6
1.34
0.39
1.04
-0.001
-0.813
0.43
0.83
-0.01
-0.04
-0.005
-0.299
1.21
2.17@
0.53
1.5
-0.004
-3.036
0.13
0.31
0.38
0.97
-0.001
-1.01
-1.16
-2.95
-0.51
-1.43
-0.005
-0.266
0.18
0.41
0.33
0.89
-0.001
-0.819
-0.34
-0.89
0.34
0.79
-0.002
-0.083
-0.53
-1.28
0.77
1.42
0.001
0.921
-0.33
-0.72
-0.06
-0.16
0.004
2.325@
-0.52
-1.42
-1.1
-3.32
0.001
0.937
-0.45
-1.12
-0.12
-0.33
0.003
1.654
10
-0.07
-0.01
-0.5
-1.52
0.004
0.281
11
-0.02
-0.05
-0.39
-1.21
0.007
3.418*
12
-0.22
-0.59
0.02
0.08
0.003
2.418*
13
0.02
0.05
-0.45
-1.41
0.001
1.13
14
-0.01
-0.02
-0.13
-0.42
-0.008
-0.618
15
-0.3
-0.67
0.02
0.08
0.006
1.076
1.5
1
0.5
-0.5
688
-1
-1.5
0.5
-0.5
15
12
-3
-6
-9
-1
2
-1
5
-1
-1.5
689
DAY
AAR
AAR
AAR
t.Stat
t.Stat
t.Stat
-15
0.25
0.41
0.63
1.06
0.002
1.874@
-14
-0.26
-0.45
0.52
0.006
2.344@
-13
-0.75
-1.18
-0.44
-0.82
0.005
1.612
-12
-0.12
-0.27
0.15
0.38
0.001
0.495
-11
0.24
0.47
-0.12
-0.35
-0.006
-0.243
-10
0.31
0.47
-0.33
-0.59
-0.007
-2.893
-9
0.24
0.41
-0.18
-0.34
-0.003
-1.959
-8
0.16
0.3
0.01
0.03
-0.001
-0.546
-7
-0.49
-0.8
-0.43
-0.78
-0.002
-0.73
-6
-0.42
-0.79
-0.17
-0.41
0.002
0.976
-5
0.04
0.08
-0.74
-2.05
-0.007
-2.073
-4
-0.44
-0.92
0.017
0.04
0.004
1.575
-3
0.05
0.09
-0.21
-0.45
-0.002
-1.119
-2
-0.23
-0.4
-0.04
-0.09
0.003
0.105
-1
-0.14
-0.27
-0.62
-1.26
-0.004
-1.936
-0.33
-0.54
-0.91
-1.65
-0.004
-2.417
-1.11
-1.81
-1.25
-2.13
-0.001
-0.479
-0.27
-0.47
-0.16
-0.29
0.006
0.366
-0.63
-1.21
-0.22
-0.52
0.003
1.475
0.29
0.56
0.33
0.61
0.001
0.158
0.3
0.47
0.4
0.75
0.009
0.378
-1.24
-2.02
-0.33
-0.67
0.007
3.078*
-0.09
-0.01
0.51
1.01
0.006
2.925*
0.02
0.05
0.17
0.44
0.002
0.87
-1.1
-1.89
-0.9
-1.97
0.003
1.434
690
10
-0.75
-1.14
-0.33
-0.58
0.004
2.273@
11
-1.21
-1.91
-0.76
-1.31
0.002
1.386
12
0.41
0.7
0.55
1.05
0.001
0.468
13
-0.58
-1.15
-0.04
-0.09
0.003
2.315
14
-0.11
-0.28
-0.48
-1.38
0.005
-0.259
15
-0.59
-1.22
-0.37
-0.95
0.001
0.692
Table-4: Cumulative Abnormal Return (CAR) for Positive and Negative Earning Changes
DAY
CAR-
CAR-
CAR-
CAR+
CAR+
CAR+
-15
0.25
-0.35
0.63
-0.23
0.002
0.003
-14
-0.01
-0.36
1.15
-0.12
0.008
0.008
-13
-1.01
-1.03
0.08
-0.04
0.011
0.009
-12
-0.87
-1.94
-0.29
-0.54
0.006
0.01
-11
0.12
-0.63
0.03
-0.04
-0.005
0.005
-10
0.55
0.48
-0.45
0.32
-0.013
0.002
-9
0.55
0.75
-0.51
0.49
-0.01
-0.001
-8
0.4
0.32
-0.17
-0.04
-0.004
-0.002
-7
-0.33
-0.05
-0.42
-0.87
-0.003
-0.004
-6
-0.91
0.69
-0.6
-0.18
-0.015
-5
-0.38
0.88
-0.91
0.54
-0.005
-0.012
-4
-0.4
1.29
-0.723
0.94
-0.003
-0.005
-3
-0.39
1.15
-0.193
0.47
0.002
0.006
-2
-0.18
0.08
-0.25
0.19
0.001
0.006
-1
-0.37
0.44
-0.66
0.64
-0.001
-0.003
-0.47
1.03
-1.53
0.38
-0.008
-0.006
-1.44
1.64
-2.16
0.52
-0.005
-0.009
691
-1.38
1.34
-1.41
0.91
0.005
-0.005
-0.9
-1.03
-0.38
-0.13
0.009
-0.006
-0.34
-0.98
0.11
-0.18
0.004
-0.006
0.59
-0.16
0.73
0.67
0.01
-0.003
-0.94
-0.87
0.07
1.11
0.016
-0.001
-1.33
-0.86
0.18
0.71
0.013
0.005
-0.07
-0.85
0.68
-1.16
0.008
0.005
-1.08
-0.97
-0.73
-1.22
0.005
0.004
10
-1.85
-0.52
-1.23
-0.62
0.007
0.007
11
-1.96
-0.09
-1.09
-0.89
0.006
0.011
12
-0.8
-0.24
-0.21
-0.37
0.003
0.01
13
-0.17
-0.2
0.51
-0.43
0.004
0.004
14
-0.69
0.01
-0.52
-0.58
0.008
-0.007
15
-0.7
-0.31
-0.85
-0.11
0.006
-0.002
Table-4: CAR for the Entire Announcement Period (Positive and Negative Earning Changes)
Cumulative abnormal return (CAR) were calculated based on three different methods,
namely Sensex adjusted returns, Mean adjusted returns and CAPM adjusted returns. The CAR was
calculated separately for positive and negative earning changes. Table 4 and column 2 show the
result of CAR based on Sensex adjusted returns. These results are similar to that of the results based
on Mean adjusted returns (column 3). However, the CAR based on Sensex returns for positive
earnings change is lower than that of CAR based on mean adjusted returns. On the other hand the
CAR for negative earnings change based on Sensex returns are greater than the CAR based on Mean
adjusted returns. The results based on CAPM based returns are shown in column 4. The results
clearly are inconsistent. Besides, the direction of CAR is not consistent. These results are contrary to
the findings based on Sensex adjusted returns and the mean adjusted returns. These may be due to
non-relevance of CAPM to the Indian Capital Market.
Chart-4: Cumulative Abnormal Return (CAR) for Positive and Negative Earning Changes
692
2
1.5
1
0.5
-0.515
-1
2
-1
-9
-6
-3
12
15
-1.5
-2
-2.5
Findings
1. The quarterly earnings announcements made by FMCG companies contain information
relevant for valuation of securities.
2. Investors react to the announcement of quarterly earnings.
3. The security prices react to the quarterly earnings announcements on day 0 and 1,
significantly.
4. The reaction is very sharp on day1, the next day of announcement.
5. The market does not react to the positive earnings information and negative earnings
information in the same manner.
6. The investors can make use of the quarterly earnings information for making superior
returns.
7. The Capital Asset Pricing Model (CAPM) does not hold for the Indian Capital Market.
8. The capital market for FMCG stocks is efficient with respect to positive earnings
information and not efficient with respect to negative information.
9. Of the three methods used to calculate the abnormal returns, Mean adjusted return is
more appropriate for event studies.
Suggestion
1. Disclosure of adequate information will make the market more efficient. In order to
make the Indian capital market efficient the regulators should impose stringent
accounting regulations and information disclosure norms.
2. A market is said to be efficient, if there is equilibrium between risk and return.
However, the most widely accepted equilibrium theory Capital Asset Pricing Model
(CAPM) does not seem to be relevant for the Indian capital market. Therefore, the
regulator must strive to make the market more efficient.
3. The present study has tested the efficiency only with respect to quarterly earnings
information. Similar studies may be undertaken on other types of company related as
well as market related information.
693
4. The present study finds that the Capital Asset Pricing Model is not relevant for the Indian
capital market. A thorough study may be undertaken to test the relevance of CAPM for
the Indian capital market.
Conclusion
This study has empirically examined the informational efficiency of capital market with
regard to quarterly earnings released by the FMCG companies. The results of the study showed that
the security prices reacted to the announcement of quarterly earnings made by the companies. The
reaction took place for the very few days surrounding day 0, for the quarterly earnings with positive
earnings change while the reaction was extended up to +15 days for the quarterly earnings with
negatively earnings change. Thus one can safely conclude from the foregoing discussions that the
Indian capital market for the FMCG stocks, in general, are efficient, but not perfectly efficient, to the
announcement of quarterly earnings (comes with positive earnings change information) and
inefficient for the negative earnings change information. This informational inefficiency can be used
by the investors for making abnormal returns at any point of the announcement period.
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696
ABSTRACT
In growing economy banks promise major share of source of money for meeting the
numerous obligations of their regulars, patrons and various organizations in day to day
marketable environment, though the banks will produce revenue from the business
transaction under the kindliness of fluctuations in their operations. The contemporary study
attempts to empirically observe the efficiency of Public and Private commercial banks
considering interest income to total asset ratio, Total Income to Total asset ratio, Interest
expended to Total asset ratio and Total expenditure to total asset ratio taken as input and
output for the banks and using non parametric technique, (Data envelopment analysis)
which evaluate efficiency of bank through multiple output and input.
Keywords: Efficiency of Banks, Data envelopment analysis, Public sector banks (SBI and
Andhra bank) and Private sector banks (ICICI Bank and Kotak Mahindra).
697
1. INTRODUCTION
Management always looks after the effectiveness, efficiency and performance of banks and it
indicates the success of the strategic objective, goals of the firms. In the similar manner
performance of any economy depends upon the efficiency of its financial system. The
performances of financial system of a country determine its economic growth indicators.
Indian financial system is based on the Indian banking industry and its capital market. The
Indian commercial banks are traditionally playing most important role as financial
intermediaries. The banks comprise more than three- fifth of financial system assets and
dominate the whole banking sector in India and played a central role in mobilizing savings in
growth process. Anil K. Sharma et al., (2012)1 found that banks having low deposits and high
total assets apparent to be on efficiency of commercial banks. Banks diversification into other
activities into other activities appears to have a negative impact and high probability of
inefficiency in banks. Banks are earning profits through traditional activities only. Big banks
profit share is obtained by these big players in industry and therefore higher probability of
these banks being on efficiency frontier. Vinod R.R (2013)2 they tried to find current
operation great ness of the operations, the bank has generated a deposit higher (6.33%) than
the required level, and non-interest income bank should be able to generate revenue of 115.36
from the existing level of 85.24 (55% more).
2. LITERATURE REVIEW
There have been several revisions that analyzed bank efficiency in India. The studies on
analyzing the efficiency of the Indian banks, and evaluation among them, are Rangarajan and
Mampilly and Thyagarajan (1972) (1975). Kwan and Eisenbeis (1997). Both identifications
provide evidence that both efficiency and capital pertinent determinants of bank risk. Jackson
and Fethi (2000) study on Turkish banks originate that the profitable banks are additional
likely to operate at sophisticated levels of technical efficiency In order to assess the intertemporal associations amongst problem loans, cost efficient and capital for a sample of US
Banks from 1985 to 1994 Granger- causality method was engaged by Berger and Young
(1997). A simultaneous equivalence agenda was adopted to test hypothesis about the
interrelationships among the risk, capitalization and operating efficiency. The efficiency of
Italian banks was dignified by employing stochastic cost-frontier analysis. Lucchetti et
al.,(2001). The results specified that measurements of created credit as well as bank explicit
efficiency scores are positively and significantly connected to regional economic growth. The
study accomplishes that there appear to be economics of scale at the commencement while
they do not appear to characterize more in fresh years. Akmal and Saleem (2008) deliberate
the technical efficiency of 30 banks efficiency. The consequences designate that banking
efficiency has enhanced since 2000 and that foreign banks are additional efficient than local
private and public owned banks. Luo (2003) recommends that the possibility of the bank
failure can be projected by the examining the complete technical efficiency of the banks
productivity banks that are not originate efficient, as per the satisfactory levels, may be
locked miserable which are highly efficient, Luciano and Regis (2007) using DEA examined
the efficiency of Italian banking system. Dwivedi and charyulu (2011) strained to examine
the behavior of various market and regulatory creativities on efficiency improvements of
Indian banks. Prabhakar, Sheriff and Nagadevera (2012) rummage-sale to statistically
quantity the efficiency of banks in India for the period 2008-2010. Tim Coelli A guide to
DEAP version 2.1: Data Envelopment Analysis (Computer Program) Centre for Efficiency
698
and Productivity Analysis they describes a computer program which has been written to
conduct DEA for purpose of calculating efficiency of banks.
2.1Statement of the problem:
Banks are answering towards the commercial issues in a different ways. The efficiency of
banks be contingent upon the functioning level due to the changes in business operations and
make profits more or less with respective of total income received and total expended for
various activities with effective utilization of bank resources. And these resources play a key
role in the maximizing the banking efficiency which is operating under same economy with
changing technological and varying level of services and size affects the efficiency and
profitability of banks over a period of time.
2.3. Objectives
1. To know the efficiency of public and private banks operating in India.
2. To know the bank efficiency in terms of bank sizes and causes for inefficiency with
a
given level of variables.
2.4. Data and Methodology
We apply non-parametric operation research based Data envelopment Analysis to assess the
efficiency of banks. Efficiency scores are obtained by using DEA model. The data collected
from scheduled commercial banks operating in India for the period of 2008-2013 is applied to
assess efficiency of banks. Therefore our sample size is public State bank of India and
Andhra Bank. Private Banks are ICICI Bank and Kotak Mahindra banks. The data obtained
from the various published reports of RBI and Capitalize financial database.DEA model is
more appropriate for practical scenario (sufian, 2009; Casu et al, 2003; Sathye et al., 2003;
Gupta et al.,2008)
Output variables
1. Interest Income to Total asset
2. Total Income to Total asset
Input variables
1. Interest Expenditure to Total asset ratio
2. Total Expenditure to Total asset ratio
DEA model procedures the efficiency of each DMU which obtained as a maximum of a ratio
of total sum of weighted output to total sum of weighted inputs. Consequently, the efficiency
can be defined as follow.
WEIGHTED SUM OF OUTPUT
Efficiency =
(1)
WEIGHTED SUM OF INPUT
Max (, ) =
=1
m
r=1
(2)
=1
= m
1: j = 1,2 .
r=1 X
0; = 1,2
0; = 1,2
Where
699
( = 1)
(3)
=1
Hence, the denominator in the efficiency score ho shown above set equal to one, the transformed
linear programming model for DMU0 can be written as follow.
0 ; = 1,2, =
=
=1
= 1
=
0; = 1,2
0; = 1,2
The linear programming model shown above will be run n times in identifying the relative
efficiency scores of all the DMUs. Each DMU select the input and output weights that
maximize its efficiency score. Generally, a DMU is considered to be efficient if it obtain a
score of 1.00 implying 100% efficiency; whereas a score of less than 1.00 implies that it is
inefficient.
Year
2002
2003
2004
2005
2006
2007
2008
2009
2010
Efficiency
99.20%
99.50%
100%
100%
97.10%
100%
100%
100%
100%
2011
2012
2013
2014
2015
Average
Variance
6.61
6.74
6.65
7.98
7.64
7.48
0.48
7.93
8.16
7.87
9.05
8.66
8.83
0.48
4.45
4.49
3.99
4.73
4.81
4.78
0.45
6.98
7.29
7.27
8.17
7.76
8.00
0.54
100%
95.10%
90.30%
100%
96%
97.54%
0.00
7.85
7.05
7.61
9.07
8.82
8.12
0.96
8.97
8.12
8.44
9.76
9.54
9.48
1.33
5.47
4.62
4.66
6.07
6.26
5.32
1.14
8.01
6.96
7.27
8.69
8.66
8.29
1.36
99.90%
98.80%
100%
100%
99.40%
99.56%
0.00
State bank of India: Average of Interest earned to total assets ratio is attained at 7.48
percent and Total Income to total asset ratio is reached at 8.83 percent as a output and Interest
expended to total asset ratio is 4.78 percent, average of Total expenditure to total asset ratio is
8 percent, here the output one is greater than the input one and output two is greater than the
input two and the average efficiency of banks are 97.54 percent.
Andhra Bank: average of interest earned to total asset ratio is 8.12 percent as an output 1
and Average Total Income to total asset ratio is 9.48 percent as an output 2 and Average of
interest expended to Total asset ratio is 5.32 percent as a input 1 and Total expenditure to
total asset ratio is 8.93 percent and average efficiency of bank is 99.56 percent for the study
period 2002-2015. Indicates the Andhra bank has 99.56 percent more efficient in terms of
generating the output with controlling of input variables. State Bank of India has average
efficiency is 97.54 percent indicate less efficiency in terms of generating output with given
level of controlling the input variables.
Year
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
Average
IE to
TA R
7.06
6.29
2.07
8.77
7.10
5.61
5.48
6.67
7.70
8.20
7.07
6.39
6.86
7.47
6.63
Variance 2.35
3.94
1.72
3.27
0.00
3.29
24.08 1.79
13.85
0.00
ICICI Bank has the average of Interest earned to total asset ratio is 6.63 percent as an Output
1 and Average of Total Income to Total asset ratio of bank is 8.47percent as a Output2 and
Average of Total expended to total asset ratio of bank is 4.80 percent as a Input 1 and
Average of Total expenditure to Total asset ratio bank is 7.41 percent and average efficiency
of banks is 97.34 percent.
Kotak Mahindra bank has average Interest earned to total asset ratio is 7.62 percent as Output
1 and average Total income to total asset ratio of bank is 11.90 percent as a Output 2 and
average of total interest expended to total asset ratio of bank is 4.42 percent as a input and
Total expenditure to total asset ratio of bank is 9.87 percent as a Input 2 and finally the
average efficiency of bank is 100 percent for the study period.
When comparing the banks in terms average efficiency of Kotak Mahindra bank has
(100 percent) more efficient than the ICICI Bank (97.34 percent).Banks amendments into
other activities seem to have a undesirable impact and high probability of inefficiency of
banks. Banking sector still earning profit through outdated activities only. Higher profitability
of any bank definitely leads to higher probability of efficiency in bank.
Chart:1 Averages of Output and InputVariables of
Banks (2002-2015)
SBI
Andhra bank
ICICI Bank
Mahindra Bank
11.90
8.12
7.48
9.87
9.48
8.83
8.47
8.00 8.29
7.41
7.62
6.63
4.78
IE to TA R
TI to TA
5.32
4.80
IEX to TA
702
4.42
TE to TA
97.54%
SBI
97.34%
Andhra bank
ICICI Bank
Kotak Mahindra
Bank
Chart 2: it indicates that the banks with larger the size are shown less efficiency of banks,
like SBI 97.54 percent and ICICI Bank has 97.34 percent. And banks are more efficient with
smaller in size are having good control in operations and implementation on new schemes
and services felicitating to customers in small size are utilizing their resources at optimal
level in earning revenue from time to time competing with banks have larger the network and
less important customer services. And here the banks are bigger in size are not under the
control of operations.
CONCLUSIONS
Indian banking system large banks have a less control over the operations in industry and
therefore small size banks are efficient and controlling their operations in the forms of
providing the modern banking and financial services and updating technological services
private sector banks are more in advance and generating revenue from non-traditional
methods and services. Banks having low Total income and high total assets apparent to be on
inefficiency of Indian scheduled commercial banks.
Small size banks and Efficient of banks benefited from the reduction of the total
expenditure and total interest paid on their deposits. The banks are worked to catch up with
the highly efficient, including private banks that have moved into the Indian market. Specific
initiatives that have helped them up include modification into such areas as trading and
services for individuals, the improvement of settlement systems, the installation of more
ATMs, computerization and other forms of technological innovation, and share lifts and
restructuring by public sector banks. .
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704
The purpose of this study is to explore the service quality level of Hospitals in Bangalore from
perspective of customers. Secondly, the satisfactions level of consumers towards the services
provided by these hospitals in general is investigated. The measurement instrument used in this
study is based on famous SERVQUAL model. In this study an attempt has been made for the first
time to explore the service quality gap by means of making a comparison between customers
expectations and their actual perceptions towards the service provided.
SPSS package is used to analyse the data set. In order to describe the sample a frequency
distribution was used. Attributes means and standard deviations were also computed. In order to
test the significant difference between sample means, paired t test is also employed. The results
have shown an alarming situation where hospitals are far away from the customer expectations.
Furthermore there is an extreme need for training in the area of customer relationship management
for hospital staff. Looking at the situation it is highly recommended that the government should take
a country wide initiative to launch special programs where hospitals internal structures and work
process are re-organized on the principles of quality management practices, through the
introduction of ISO Programs. This would help in improving the service quality at each stage of the
services provided by these hospitals.
KEYWORDS: Service Quality, Service Provider, Customers Satisfaction, Hospital Industry, Quality
Gap.
* Asst. Professor, Dayananda Sagar Institutions, Bangalore
705
19.2 INTRODUCTION
Due to acceleration in globalization, consumers have become more educated and better informed
than ever before. The new rise in the global competitive environment among industrial and service
sectors has also influenced the domestic business, particularly the healthcare services. At the same
time superior quality to customer has provided firms with an opportunity to differentiate
themselves in competitive markets (Karatepe, Yavas, and Babakus, 2005). This new emergence of
service sector as a key contributor in global economic uplift has diverted the attention of many
academic researchers towards the area of service quality (Andreassen and Olsen, 2008; Liang, Wang,
and Farquhar, 2009). The hospitals have started to emphasize on improved service quality, as they
know that it is the only mean left for their survival by acquiring market share (Lim and Tang, 2000).
Even though that service industries have been playing a key role in economic uplift, yet the quality
of services seems to be declining. Huge complaint volume from customers have made executives to
think, how they could perform better and go beyond the expectation levels of their customers.
Today patients demand for complete and accurate information before availing any type of service by
a particular hospital and in case of dissatisfaction they never hesitate switching to another hospital
(Ramsaran and Roshee, 2008). Therefore managers in these sectors are under extreme pressure
within their financial constraints to properly understand their customers expectations by means of
putting themselves into their shoe, thus demonstrating that they are highly customer focused and
they understand what their customers are looking for. Furthermore customers expectations from
customers perspective has to be accurately measured and, any gaps in service quality must be
pinpointed in order to narrow down the gap. This supports managers to explore lucrative ways of
minimizing service quality gaps, thus making sensitive decision given scarce resources. With the
advent of new technology in health care every single person is looking for accuracy and a service
much better and much faster than what he/she has availed in the past. In addition to it the online
doctors have added more value than ever before. It has therefore become important that hospital
administrators must be trained in marketing and planning techniques for better operations of the
health care facilities. Customer expectations tell us where exactly we are going wrong or we might
be wrong. According to Zeithaml and Bitner (2003) the most critical and first step in delivering
quality services is, how much one knows about his customer expectation. Most healthcare
consumers, namely patients, prepare a mind-set with certain level of expectations about the
service they going to demand, before visiting to the hospital or clinic. If the service does not match
706
to their expectation they become more frustrated. Now the question is whether or not the general
masses of a country are getting standard medical facilities. The developed nations might have
achieved a landmark in provision of health facilities to their people but the underdeveloped and
developing countries are still striving and struggling to come up to the expectations of their people
due to financial and other non-budgetary constraints. India is a developing economy and
unfortunately political unrest and corruption has caused serious financial deficit. Healthcare facilities
in the country are not enough to meet the requirement of millions of people, majority of those living
in rural areas. Available healthcare facilities in public sector are not making much effort to improve
the level of service quality. This factor had created an opportunity for the private hospitals to fill this
gap by developing facilities that meet customer expectations and perceptions but at a much higher
cost. The vices provided by these hospitals have never been extensively investigated in the past.
Uniqueness of this study is that there are limited studies conducted on this topic in India, and this
study will help to examine the current status of services delivered to the customers by the hospitals
in Bangalore. Furthermore the research will use the empirical data, using Parasuraman, Zeithaml
and Berrys (1988) SERVQUAL model to measure the standard of service quality offered by a hospital
in Bangalore, identifying the gaps that exist in the service quality and then adopting appropriate
measures to fill the gap between patients expectations and perception of services by the hospital
staffs.
20LITERATURE REVIEW
20.1.1 1.1 Health Facilities in India
The hospital industry is a sector within the economic system that provides goods and services to
treat patients with curative, preventive, rehabilitative, and palliative care. The modern health care
sector is divided into many sub-sectors and depends on interdisciplinary teams of trained
professionals and paraprofessionals to meet health needs of individuals and populations. The
hospital industry is one of the world's largest and fastestgrowing industries. Consuming over 10
percent of gross domestic product (GDP) of most developed nations, health care can form an
enormous part of a country's economy.
.
The World Health Organization estimates that there are 9.2 million physicians, 19.4 million nurses
and midwives, 1.9 million dentists and other dentistry personnel, 2.6 million pharmacists and other
pharmaceutical personnel, and over 1.3 million community health workers worldwide, making the
707
health care industry one of the largest segments of the workforce. The delivery of hospital services
from primary care to secondary and tertiary levels of care is the most visible part of any health care
system, both to users and the general public. Improving access, coverage and quality of health
services depends on the ways services are organized and managed, and on the incentives influencing
providers and users.
708
For the purpose of the current study we will focus on GAP-5 direct measurement, (Perception
Expectation).
709
To measure the Service Quality in selected hospitals and find out the reasons for gaps.
To suggest some measures for the policy makers in health care sector and the selected
specific hospitals for reducing, eliminating the Service Quality gap and finally making the
health care delivery in India effective.
distribution was used. Attributes means and standard deviations were also computed. In order to
test the significant difference between sample means, paired t test is also employed.
and attribute 8 Hospital provides services at the time they promise to do so were having the same
gap score ( 1.66) both sig <0.01. Further differences were found on attribute 9 Hospital staff keeps
the records accurately and error-free (-1.49 sig <0.01). Many other attributes such as attribute 9, 6,
5 , 4 and 3 all were having significant difference at (sig <0.01). This shows that the problem is far
more cumbersome and alarming as for as the basic health services provision to the masses are
concerned. Hospitals like Sai Ram being the major source for the people living in Bangalore for
getting the medical treatment are quite below the international standards. Out the of the 11
attributes mentioned for Sai Ram hospital three attributes belong to tangibility means that physical
appearance of the hospitals is not satisfactory at all. They dont have either well equipped
laboratories and other necessary equipment. Again the factors of reliability were found to have a
serious shortfall in Sai Ram hospital as well. Therefore there appears to be an extreme and urgent
need for special training courses on periodic basis for hospital staff in the area of customer
relationship. Both the category of hospitals should give serious concern towards changing their
behavior and become customer oriented. Assurance was the last construct that has shown a serious
shortfall. Four attributes namely 14, 15, 16 and 17 belong to this construct. This shows that Sai Ram
hospital has failed to gain the trust and create confidence among the general masses as for as the
provision of services by them is concerned. The overall Gap 5 score for Fortis Hospital is -0.10 (sig.
<0.01), which indicates that, the overall service quality provided by the Fortis hospital is below
customers expectations. When the dimensions were we ranked in accordance of their gap scores, it
is observed that the biggest gap (-0.70) pertaining to assurance, followed by reliability (-.66) and
finally the tangibility (-0.57). When the overall Gap scores is compared with Sai Ram Hospital, where
Gap 5 score is -0.31 (sig. <0.01), which indicates that, as a whole the service quality provided by the
Sai Ram hospital is extremely low and quite below customers expectations. In comparison still Fortis
hospital is better in their services even though they do have some shortfalls. When the dimensions
for Sai Ram Hospital is ranked in accordance of their gap scores, it is observed that the largest gap (1.54) is associated to assurance, followed by tangibility, (-1.30) tangibility and finally the reliability (1.26). The gap scores of the Sai Ram hospital is big and therefore reflect a negative picture of Sai
Ram hospital.
21.2.3 3.3 Customers Analysis of Recommending Hospitals to Others
21.3 (SATISFACTION)
Customers were asked, whether they will recommend their hospitals to others or not. This would
show their level of satisfaction. As satisfied customers is always a returning customer and at the
same time recommending others shows the level of your positive or negative attitude towards
something. Besides that, it is presumed that people generally recommend others what they feel or
712
believe are good and they having good experiences with it. Nearly 68.1 percent of the respondents
taking service from the Fortis hospitals are of the opinion that they will recommend their hospitals
to other friends and peers while 31.9 percent opposed it. Whereas the respondents taking services
from Sai Ram Hospital, 55.9% of the respondents were of the opinion that they will not recommend
others to go to Sai Ram hospital for treatment while 44.1% of the respondents answered in negative.
This also shows that a Sai Ram hospital in Bangalore does not have necessary services or medical
facilities like Fortis Hospital.
Hospital staff need to do the job right the first time and in a timely fashion. The way hospital staff
should interact with the customers/consumers should build in trust, patients must feel safe while
making transactions and the behavior of the staff should be friendly. It is quite unfortunate that
basic customer relationship skills are missing among the hospital staff. On the other hand few
hospital staff needs to improve a bit more in the area of tangibility and assurance. Further
investigation has also shown that most of the hospitals dont have formal Quality Management
program. Special initiatives to run quality training programs at the government level would help in
improving the quality of services provided by these hospitals. Government should take special steps
at country level to introduce special Quality Management Program with ISO collaboration for
ensuring quality in hospitals.
713
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Babakus,E. and Mangold,W.G. 1992. Adapting the SERVQUAL scale to hospital services: an
empirical investigation. Health Services Research. vol. 26, no. 6, pp. 767-786.
Taylor,S.A. and Cronin,J.J. 1994. Modeling patient satisfaction and service quality. Journal
of Health Care Marketing. vol. 14, no. 1, pp. 34- 44.
Parasuraman, A., et al., (1988), Op. Cit., 6. Youssef,F.N., Nel,D., and Bovaird,T.
1996. Health-care quality in NHS hospitals. International Journal of Health Care Quality
Assurance. vol. 9, no. 1, pp. 15-28.
Curry,A. and Sinclair,E. 2002. Assessing the quality of physiotherapy services using
SERVQUAL. International Journal of Health Care Quality Assurance. vol. 15, no. 4/5, pp.
197-207.
9. Hussey,J. and Hussey,R., 1997. Business Research (1st Edition). Chippenham, Wiltshire:
Macmillan Press Ltd.
10. Bopp,K.D. 1990. How patients evaluate the quality of ambulatory medical encouters: A
marketing perspective. Journal of Health Care Marketing. vol. 10, no. 1, pp. 6-15.
11. Casarreal,K.M., Mills,J.I., and Plant,M.A. 1986. Improving service through patient surveys
in a multi hospital organization. Hospital & Health Services Administration. vol. 31, no. 2,
pp. 41-52.
12. Ware,J.E. and Snyder,M.K. 1975. Dimensions of patient attitudes regarding doctors and
medical care. Medical Care. vol. 8, pp. 669-682.
15. Heskett, J.L., Jones, T.O., Loveman, G.W., Sasser, W.E.Jr. and Schlesinger, L.A., (1994),
Putting the Service Profit Chain to Work, Harvard Business Review, 72, 164.
14. Zeithaml, V.A., Berry, L.L., and Parasuraman, A., (1996), The Behavioural Consequences
of Service Quality, Journal of Marketing, 60, pp 31-46.
714
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Relational or Transactional Managers? European Journal of Marketing, 34, 453-471.
Peltier, J.W., Boyt, T. and Schibrowsky, J.A., (1998), Relationship Building, Marketing
Health Services, 18, 16-24.
Gronroos. C., (1992), Service Management: a Management Focus for Service Competition, in
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Prentice-Hall, Englewood Cliffs, NJ. 9-16.
White, S.S., and Schneider, B., (2000), Climbing the Commitment Ladder: the Role of
Expectations Disconfirmation on Customers Behavioural Intentions, Journal of Service
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Padgett, T., 2005. Patient satisfaction with rural primary care services: A study of the
relationship between provider type and level of satisfaction. Unpublished Msc thesis. The
Florida State University: School of Nursing.:12
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Quality, II (I), 7-9
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Heineke, J. and Tsikriktsis, N., 1998. A Note on Services and Service Quality, Unpublished.
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Services, Journal of Empirical Generalizations in Marketing Science, 3:25
Gap
(Mea
n)
(Mea
n)
(P-E)
4.55
3.94
-.61
7.69
**
4.32
3.71
-.61
4.28
3.65
4.08
4.56
Attributes
CA
Gap
(Mea
n)
(Mea
n)
(P-E)
4.29
2.82
-1.47
8.13
**
7.29
**
4.17
2.5
-1.67
10.3
7**
-.63
5.69
**
3.94
2.95
-.99
5.94
**
3.62
-.46
5.27
**
3.77
2.72
-1.05
6.23
**
3.39
-1.17
7.69
**
4.26
3.1
-1.16
5.92
**
tvalue
tvalue
Tangibility
Hospital has modern and up to date
Equipment
.83
.84
Reliability
.67
.60
4.45
3.53
-.92
7.39
**
4.07
2.76
-1.31
5.92
**
4.1
3.74
.36
3.32
**
3.88
3.2
-.68
3.16
**
4.46
3.54
-1.01
5.25
**
4.36
2.7
-1.66
8.03
**
4.5
3.94
-.56
7.69
**
4.32
2.83
-1.49
8.21
**
2.2
2.91
.71
4.91
**
2.41
3.66
1.25
6.53
**
2.06
.94
2.54
3.6
1.06
1.94
2.71
.77
6.81
**
6.43
**
2.1
3.51
1.41
5.22
**
7.15
**
2.59
3.16
.57
3.94
**
2.8
3.3
.5
1.98
**
4.06
3.62
.71
4.91
**
2.41
3.66
1.25
6.53
**
4.48
3.59
.94
6.81
**
2.54
3.6
1.06
5.22
**
4.52
3.5
.77
6.43
**
2.1
3.51
1.41
7.15
**
4.22
3.74
.57
3.94
**
2.8
3.3
0.5
1.98
**
.65
Assurance
.67
Behaviour of Hospital staff instil
confidence and trust in customers
Patients feel safe in their transactions
with the Hospital
Hospital staff shows Friendliness and
courtesy
Hospital staff is having knowledge to
answer to the queries of the patients
Empathy
717
.65
2.2
2.87
.67
4.40
**
2.59
3.31
.72
1.9
2.64
.74
1.99
2.9
.91
1.97
2.75
3.45
3.35
.61
.76
2.11
3.51
1.4
8.20
**
4.60
**
6.39
**
7.80
**
2.76
3.59
.83
2.01
3.58
1.57
2.3
3.51
1.21
5.20
**
8.89
**
5.31
**
.78
5.68
**
2.2
3.6
1.4
6.03
**
-0.1
3.96
9**
3.41
3.1
-.31
7.43
1**
Notes: *t-test two-tailed probability <0.05; **t-test two-tailed probability <0.01; standard deviations
are in parentheses; a negative gap indicates that customers perceived that service delivery did not
meet their expectations; a positive gap indicates that customers perceived that service delivery
exceeded their expectations.
718
Abstract:
The field of Strategic Human Resource Management considers people as a vital and a
strategic asset of an organisation thereby making a major assumption that the way an
organisation performs,significantly depends upon the way people perform. The fact that
human resources are considered as strategic asset invariably makes it a source of competitive
advantage. To sustain this competitive advantage, it is crucial for the organisations to
implement HR strategies that have a positive impact on their performance. However, the link
between HR strategies and organisational performance is an under researched area. This
paper, thus examines the role played by human resource strategies on an organisations
performance and thereby sustainable competitive advantage.
Key words: StrategicHuman Resource Management, Human Resource Strategies,
Competitive advantage, Organizational Performance
Introduction
An organisation operating in the present competitive world, cannot entirely depend on
production capabilities, financial resources, distribution channels and marketing expertise for
gaining advantage over its competitors. This is because, all these factors that were once
thought of asproviding competitive advantage to the company,are now equally available
toother companies as well. Thus these factors are now considered as mere assets and not
assets that give competitive advantage.Organisations are now realising that they need to
equip themselves with such assets that cannot be duplicated by the competitors.
719
Contemplating the possibility of existence of such assets has given rise to the thought that the
only asset in an organisation that fit the bill is the people employed by it. People are the key
asset which an organisation can acquire and also, it is the only asset that has the potential to
learn, grow and contribute (Fitz-enz, 1995).This makes human resources a strategic asset. In
a world in which all work is knowledge work and intellectual capital is crucialfor economic
success, it is logical that the ability to attract, retain, and use the talents of people provides
acompetitive edge (OReilly &Pfeffer, 2000). Consequently, human resource management
which deals with recruitment, training and development of the people, has now become a part
of
strategic
management
and
has
evolved
as
Strategic
Human
Resource
Literature Review
Organisations in the competitive scenario are continuously faced with the necessity to create
and sustain practices that facilitate value creation (Jyothi&Venkatesh 2009). Effective
organisations are increasingly realizing that, of the varied factors that contribute to
performance, the human element is clearly the most critical (Jeffery2009). An organisations
human resources are the people it employs to carry out various jobs, tasks and functions in
720
exchange for wages, salaries and other rewards (Angelo & Ricky, 2008). Human resource
management deals with people related issue and is defined as the process of acquiring,
training, appraising, and compensating employees, and of attending to their labour relations,
health and safety, and fairness concerns (Dessler&Varkkey, 2008). Wright et al. (1999)
conducted research on 190 US petro-chemical refineries in which they examined the impact
of HR practices (selection, training, compensation and appraisal) on firm performance. Their
results confirmed the existence of a direct relationship between training and compensation
with workforce motivation. However, they found that HR practices (selection, compensation
and appraisal) are positively related to firm performance only under highly participative
systems. Bae and Lawler (2000) examined the effects of organizational strategic variables
regarding HRM and the source of competitive advantage of 138 Korean firms. They found
that firms with high-involvement HR strategies had better performance. Research conducted
by Paul and Anantharaman (2003) suggested that practices like training, job design,
compensation and incentives had a direct effect on the operational performance parameters.
The significant relationship between HR practices and firm performance is encouraging and
is in agreement with findings from other studies (Arthur, 1994; Pfeffer, 1994; Huselid, 1995;
Delery& Doty, 1996; Delaney and Huselid, 1996; Guest, 1997; Huselid et al., 1997;
McMahan et al., 1999; Fey et al., 2000; Huang, 2001; Stavrou and Brewster, 2005;
Christiansen and Higgs, 2008). Thus, lot of research work has been done to find the impact
HR strategies have on firm performance, but, very few studies have been made to find the
link between HR strategies and Organisational effectiveness.
Objectives of the study
In the light of the literature review, the main focus of this study is to find out the impact the
six human resource strategies viz., staffing, training, involvement and participation,
performance appraisal, compensation/reward and employee caringhas on organisational
performance.
Research Hypothesis
Based on the reviewing of past empirical studies, the following six hypothesis have been
generated linking HR strategies and organisational performance:
H1: A positive relationship exists between staffing strategies and organisational
performance.
721
H2:A positive relationship exists between training and development strategies and
organisational performance.
H3: A positive relationship exists between employee involvement &participation strategies
and organisational performance.
H4: A positive relationship exists between objective performance appraisal strategies and
organisational performance.
H5: A positive relationship exists between compensation & rewards strategies and
organizationalperformance
H6:A positive relationship exists between employee caring and organizational performance
Dependent variable
Organisational Performance
Operational performance
Financial performance
participation
Performance appraisal
Compensation/Rewards
Employee caring
722
723
The questionnaire was administered to the line managers from the different departments and
to the assistant managers from HR and Finance department. The respondents are well
qualified holding bachelors/masters degree in various academic field.
The demographic analysis indicates that majority of the respondents are male i.e., 98%. This
is because of the nature of the company i.e., manufactures chemicals and fertilizers and hence
female employees are considerably low. About 56% of the respondents are at least 35 years
old. 80% of the respondents have put in at least 5 years of service in the company and 45% of
the respondents have been employed for more than 15 years. This shows that the respondents
have actually spent enough time in the service to know how strategic the
recruitment/selection and training/development practices are in the company. However, the
demographics data has not been used for analysis in this study.
Data Analysis:
Factor analysis is a statistical method used to describe variability among observed variables
interms of a potentially lower number of unobserved variables called factors and this
technique isapplied when the reliability is below 0.8Factor analysis assumes that all the rating
data on different attributes can be reduced downto a few important dimensions. This
reduction is possible because the attributes are related. In thequestionnaire survey, the
reliability test has been conducted to test the internal consistency reliability between the items
in the questionnaire. The internal consistency reliability indicates theextent to which items on
a given measure assess the same construct. The reliability test generatedresults, which were
above 0.8 for all the dependent and independent variable relationships.
Hypothesis 1 predicted that a positive relationship exists between staffing strategies and
organisational performance. The study found (Table 1) significant positive relationship of
staffing with organizational performance (r=.76**, p<.01).Thus hypothesis is accepted.
Regression results in Table 2 also supported the hypothesis with organization performance
(=.64*, p<.05). Hypothesis 2 predicted that a positive relationship exists between training
and development strategies and organisational performance. The research indicated
significant positive relationship of training and development strategies with organizational
performance (r=.76**, p<.01). Thus hypothesis is accepted. This is also supported by
regression analysis (=.65*, p<.05). Hypothesis 3 predicted that a positive relationship exists
between employee involvement & participation and organisational performance. The study
reported significant positive relationship of involvement and participation with organizational
724
Mean
SD
1. Staffing
4.4
.5
(.8)
4.4
.5
4.3
.4
4.4
.4
5. Compensation/Rewards
4.5
6. Employee Caring
4.2
2. Training
3.
Involvement
participation
4. Performance appraisal
&
7.
Organizational
4.2
performance
(.8)
N=98, **p<.01, *p<.05
.65*
*
.65*
(.8)
.71*
*
(.82)
.39*
.41*
.29*
.4
.38*
.13
.46*
*
.16
.23*
*
.06
(.81)
.7
.57*
*
.23*
.76*
.76*
.77*
.52*
.46*
.4
(.8)
.17
(.82)
.16
Variables
Staffing
725
AR2
.64*
11.85
140.58
.58
Training
.65*
11.91
141.91
.58
.75*
11.98
143.51
.59
Performance appraisal
.48*
6.04
36.5
.26
Compensation/Rewards
.47*
5.12
26.3
.2
Employee Caring
.09*
1.64
2.7
.01
N=98,*p<.05
DISCUSSION
The result shows that staffing has significantly higher relationship with the organizational
output.The key to maximizing organizations success and minimizing its risk is the
implementationof a systematic staffing approach that is fair, job-related and legally
defensible. According to Hogg(2001) recruitment and staffing provides the overall
framework for the process of planning,recruiting, selecting, and hiring of employees.
Employee recruitment, selection and retention playvital role in accelerating organizations
overall performance because it is the skilled employees whoeventually make contribution for
organizational success. Training has direct effect to boost upperformance which later on
moderates efficiency and effectiveness followed by organizationalperformance.Kintana,
Alonso and Olaverri (2006) indicated that training has positive effects on productivity.Martell
& Carroll (1995) indicated that training has positive effects on competency, turnover
andemployee commitment. The study also indicated significant relationship of training with
theorganizational performance. Involvement and participation has been proved to be another
factor toensure organizational performance. Employee involvement and participation at work
have beenidentified as key factors in developing successful and mutually beneficial
workplace relationships which lead to organizational success (Das 2003). Employee
participation is in part a response to thequality movement within organizations. The more
employees are encouraged to take part indecision and policy making process for the
organization the higher the level belongingness will bepronounced in the organization.
Performance appraisal has positive significant relation with theorganizational performance.
The purpose of performance appraisal is to measure the currentperformance and the level of
development of individuals. Depending on the requirements,employees are further trained,
promoted or valued by the organization. LeBoeuf (1985) suggestedthat managers secure
desired results through a compensation and reward philosophy thatrecognizes employees for
the right performance. Even for training programs to be successful,organizations should
reward managers who prove to be excellent trainers. The research found norelationship of
726
employee caring with organizational performance. This was not consideredimportant by the
employees.
Conclusion
This study is based onempirical research reviewing the impact of human resourcestrategies
on Organisational performance in Mangalore Chemicals and Fertilizers Limited. The current
study reveals that the selected human resource strategies has a positive impact on
organisational performance, thereby reiterating the existing literature that human resources if
used as a strategic asset can indeed be used to manage business competitiveness. Thus, we
can conclude that Human resource strategies lead to increase in employee productivity and
employee efficiency which gets projected in the organisational performance. Failure of any
one of the components of human resource strategies will have an impact on other components
which in turn will lead to poor organisational performance.
Limitations:Small sample size was one of the major limitation of the present study.
Moreover, the study did not take into account all the HR strategies of the surveyed
manufacturing firm. In addition, the results of this research must be viewed with caution
since it is a case based study. As such the results of this study cannot be generalized.
However, this study could be used as a reference to find out the impact of strategic human
resource management on organisational performance.
Directions for future research:In order to validate the findings of this study, future research
may be carried in other industries. Future research with larger sample sizes would be
productive to provide a support for the present findings. Additionally, the results of this study
can be retested in other business organisations, so that the results can be generalised to other
economic sectors.
References:
1.
2.
3.
4.
Angelo DeNisi, S. & Ricky Griffin, W. (2008). Human Resource Management. New
Delhi: Biztantra,5.
Arthur, J.B. (1994). Effects of human resource systems on manufacturing performance
and turnover. Academy of Management Journal, 37(7), 670-687.
Bae, J. and Lawler, J.J. (2000). Organizational and HRM strategies in Korea: impact on
firm performance in an emerging economy. Academy of Management Journal, 43(3),
502-517.
Christiansen, L., & Higgs, M. (2008). How the alignment of business strategy and HR
strategy can impact performance. Journal of General Management (UK) , 33(4), 13-21.
727
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728
24. OReilly, Charles A.; Pfeffer, Jeffrey. Hidden Value: How Great Companies Achieve
Extraordinary Results with Ordinary People, Boston: Harvard Business School Press,
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25. Paul, A.K. and Anantharaman, R. N. (2003). Impact of people management practices on
organizational performance: analysis of causal model. International Journal of Human
Resource Management, 14 (7), 1246-1266.
26. Pfeffer, J. (1994). Competitive Advantage through People. California Management
Review, 36, 2, 928.
27. Stavrou, E., & Brewster, C. (2005). The configurational approach to linking strategic
human resource management bundles with business performance: myth or reality?
Management Review, 16 (2), 186-201.
28. Wright, P. M., McCormick, B., Sherman, W.S. and McMahan, G. C. (1999). The role of
human resource practices in petro-chemical refinery performance. International Journal
of Human Resource Management, 10(4), 551-571.
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729
ABSTRACT
Corporate governance is not a new name in todays world. It has its own place and
importance in guidelines enunciated by CII, SEBI and Companies Act, 1956. Many
researchers have done research on various areas of corporate governance in India and across
the globe.
All areas have been covered and it is been observed that less papers have been published in
the area of Information Technology Industry. Researcher picked the Indian Information
Technology Industry listed in stock exchanges in India to do comparative study of corporate
governance score and financial measures viz. ROI, DPR, Total Sales, Total Assets, EPS,
EBIT & Net Worth of the company.
Analysis of data collected has been done through graphical representation through box plot
and Skewness of the data is calculated to find out the symmetry. It is been observed that CG
Score of Group A companies is better than group B companies and the parameters are
averagely positively skewed.
Hence; not all financial parameters but some of the financial parameters are positively related
with the increase or better CGScore.
Introduction
The Companys core values - Innovation, Insight and Integrity absorbs in itself the Corporate
Governance Philosophy.
In recognition of the good Corporate Governance practices adopted by the Company, ICRA
Limited (an associate of Moodys Investors Service), a leading provider of investment
information and credit rating services in India, has assigned a CGR ratings to the Corporate
Governance Practices of the Company.(3 infotech,2005-06).
The Companys status of Compliance with the non-mandatory requirements is given or
disclosed by all the organizations.
730
Literature Review
The notion of corporate governance gained importance in India post liberalization,
voluntarily guidelines introduced by CII, the foremost industry association in India. By the
year 2000, the same had been incorporated as a requirement in the clause 49 of the listing
agreement administered by the market regulator Securities Exchange Board of India. It was
followed by the Naresh Chandra Committee report with major focus on independent
supervision of board and audit, and improvements in disclosures of financial as well as nonfinancial aspects. In the successive years, two more committees were constituted under the
leadership of Mr Narayan Murthy and Mr J J Irani, with the explicit aim of bringing in best
practices from all over the world to create a well regulated environment.
In 2009, the Satyam fiasco shook the Indian industry, bringing home the point that proper
governance is indispensable to further growth and development. Since then efforts to create a
framework have gained pressure. The Ministry of Corporate Affairs (MCA) came out with
guidelines in 2009.
Research Methodology
Exploratory research has been conducted for the data collected.
Data Collection
Data has been collected from annual reports of Indian IT companies listed in stock exchanges
in India for five years. Total 24 companies have been taken excluding Satyam because of non
availability of correct data. All companies have been divided into two groups named
groupA and groupB based on their authorized capital. 400 crores and above group A
companies and below that companies fall in group B category.
Hypothesis
H1: Companies with better corporate governance score perform financially well.
H0: Companies without better corporate governance score also perform financially well.
Data Analysis, Findings and Conclusion
In this section of data analysis we had observe all Measures of Central Tendency and try to
explain the distribution of data. Also the measure of Skewness is also obtained for further
characterization of the data. Skewness is a measure of symmetry, or more precisely, the lack
of symmetry. A distribution, or data set, is symmetric if it looks the same to the left and right
of the center point. If skewness = 0, the data are perfectly symmetrical. But a skewness of
731
exactly zero is quite unlikely for real-world data, so how can you interpret the skewness
number? Bulmer, M. G., Principles of Statistics (Dover, 1979) a classic suggests this
rule of thumb:
If skewness is less than 1 or greater than +1, the distribution is highly skewed.
If skewness is between 1 and 0.5 or between + 0.5 and +1, the distribution is
moderately skewed.
Graphical representation of data was done by using Box Plots. The box plot is a graphical
representation of data that shows a data sets lowest value, highest value, median value, and
the size of the first and third quartile. The box plot is useful in analyzing small data sets that
do not lend themselves easily to histograms. Because of the small size of a box plot, it is easy
to display and compare several box plots in a small space. A box plot is a good alternative or
complement to a histogram and is usually better for showing several simultaneous
comparisons (Ott, R., Lyman & Micheal, T., Longnecker, 2008).
CG Scores
Table .1
Comparison of CG Scores of Group A and Group B Companies
GROUP
A
GROUP
N
Valid
Missing
60
Valid
Missing
60
0
Mean
79.57
Mean
75.43
Median
77.50
Median
76.00
Mode
74
Mode
Skewness
.737
Skewness
Std. Error of
.309
Std. Error of
Skewness
76
-.482
.309
Skewness
Minimum
68
Minimum
59
Maximum
95
Maximum
87
25
74.00
Percentiles
50
75
Percentiles
25
71.25
77.50
50
76.00
83.75
75
80.75
732
INTERPRETATION Mean of CG Score for Group A and B companies are 79.57 and
75.43 and their median score are 77.50 and 76.00 respectively. In case of group A companies,
mean is greater than median which shows that distribution of data is positively skewed.
Further from the value of coefficient of skewness (+.737) it can be verified that group A data
is positively skewed. And such degree of skewness (+.737) can be categorized into
moderately skewed.
In group B data, mean score is less than median, hence it can be interpreted that data
distribution for group B is negatively skewed as the value of skewness coefficient is also .482. Such degree of skewness is approximately skewed.
Hence it can be concluded that in both the cases (Group A and B) is data is not highly
skewness and can be consider approximately similar to normal distribution.
Spread of data for both the groups A and B can be observed from Box plot in Figure1. Fig.1
shows group A is spreaded from CG score value 68 to 95 whereas distribution of group B is
from CG score value 59 to 87. Range for group A is 27 (95 68) and for group B is 28 (8759), which shows that there is not much significant difference in range of both the groups.
Box plot also shows that mean values for both the groups are also close.
733
GROU
GROU
Valid
60
Missin
Valid
60
Missin
Mean
27.95500
Mean
23.64433
0
Median
22.90000
Median
21.86000
19.1000a
Mode
13.0000a
Mode
Skewness
.912
Skewness
.516
Std. Error of
.309
Std. Error of
.309
Skewness
Skewness
Minimum
-12.7800
Minimum
3.5100
Maximum
88.7000
Maximum
54.0800
Percentile
25
16.50250
Percentile
0
50
25
22.90000
0
50
0
75
16.00000
21.86000
0
40.00000
75
30.95000
0
734
INTERPRETATION - Mean of ROI for Group A and B companies are 27.96 and 23.64 and
their median score are 22.90 and 21.86 respectively. In case of group A companies, mean is
greater than median which shows that distribution of data is positively skewed. Further from
the value of coefficient of skewness (+.912) it can be verified that group A data is positively
skewed. And such degree of skewness (+.912) can be categorized into moderately skewed.
In group B data, mean ROI is more than median, hence it can be interpreted that data
distribution for group B is positively skewed as the value of skewness coefficient is also .516.
Such degree of skewness is approximately skewed.
Hence it can be concluded that in both the cases (Group A and B) is data is moderate
skewness and can be consider approximately similar to normal distribution.
Spread of data for both the groups A and B can be observed from Box plot in Figure2. Fig.2
shows group A is spreaded from ROI value -12.78 to 88.70 whereas distribution of group B is
from ROI value 3.51 to 54.08. Range for group A is 101.48 (88.70 (-12.78)) and for group
B is 50.57 (54.08-3.51), which shows that there is significant difference in range of both the
groups. Box plot also shows that mean values for both the groups are not so close.
Earnings Per Share (EPS)
Table .3
735
GROU
Valid
60
Missin
Valid
60
Missin
Mean
28.15283
Mean
20.34866
3
Median
18.47500
Median
15.57000
0
Mode
14.3700
-18.8100a
Mode
Skewness
.646
Skewness
Std. Error of
.309
Std. Error of
Skewness
1.289
.309
Skewness
Minimum
-54.0500
Minimum
-18.8100
Maximum
101.6500
Maximum
85.5300
Percentile
25
9.702500
Percentile
25
7.007500
50
18.47500
50
15.57000
0
75
44.38250
75
27.92500
Figure .3 Comparison of Earnings Per Share (EPS) of Group A and Group B Companies
736
INTERPRETATION Mean of EPS for Group A and B companies are 28.15 and 20.34 and
their median score are 18.47 and 15.57 respectively. In case of group A companies, mean is
greater than median which shows that distribution of data is positively skewed. Further from
the value of coefficient of skewness (+.646) it can be verified that group A data is positively
skewed. And such degree of skewness (+.646) can be categorized into moderately skewed.
In group B data, mean score is more than median, hence it can be interpreted that data
distribution for group B is positively skewed as the value of skewness coefficient is also
1.289. Such degree of skewness is highly skewed.
Hence it can be concluded that in both the cases (Group A and B) data is moderately &
highly skewness and can be consider approximately similar to normal distribution.
Spread of data for both the groups A and B can be observed from Box plot in Figure3. Fig.3
shows group A is spreaded from EPS value -54.05 to 101.65 whereas distribution of group B
is from EPS value -18.81 to 85.53. Range for group A is 155.7 (101.65 (-54.05)) and for
group B is 104.34 (85.53-(-18.81), which shows that there is significant difference in range
of both the groups. Box plot also shows that mean values for both the groups are not that
close.
Dividend Payout Ratio (DPR)
Table .4
Comparison of Dividend Payout Ratio (DPR) of Group A and Group B Companies
GROU
GROU
P
737
Valid
60
Missin
Valid
60
Missin
Mean
27.97116
Mean
26.59016
7
Median
20.05000
Median
22.90000
0
7.7000a
Mode
.0000
Mode
Skewness
5.403
Skewness
.817
Std. Error of
.309
Std. Error of
.309
Skewness
Skewness
Minimum
.0000
Minimum
-4.2500
Maximum
323.5000
Maximum
74.1000
5.612500
Percentile
Percentile
25
25
s
50
20.05000
0
50
0
75
13.41250
22.90000
0
30.00000
75
38.45000
0
Figure 4. Comparison of Dividend Payout Ratio (DPR) of Group A and Group B Companies
738
INTERPRETATION Mean of Dividend Payout Ratio (DPR) for Group A and B companies
are 27.97 and 26.59 and their median score are 20.05 and 22.90 respectively. In case of group
A companies, mean is greater than median which shows that distribution of data is positively
skewed. Further from the value of coefficient of skewness (+5.40) it can be verified that
group A data is positively skewed. And such degree of skewness (+5.40) can be categorized
into moderately skewed.
In group B data, mean DPR is more than median, hence it can be interpreted that data
distribution for group B is positively skewed as the value of skewness coefficient is also .817.
Such degree of skewness is moderately skewed.
Hence it can be concluded that in both the cases (Group A and B) data is moderately
skewness and can be consider approximately similar to normal distribution.
Spread of data for both the groups A and B can be observed from Box plot in Figure4. Fig.4
shows group A is spreaded from DPR value .00 to 323.5 whereas distribution of group B is
from DPR value -4.25 to 74.10. Range for group A is 323.5 (323.5 .00) and for group B is
78.35 (74.10-(-4.25)), which shows that there is not much significant difference in range of
both the groups. Box plot also shows that mean values for both the groups are also close.
Table .5
Comparison of NW of Group A and Group B Companies
GROU
GROU
Valid
60
Missin
Valid
60
Missin
Mean
4905.8710
Mean
917.5101
3
Median
2605.5650
7
Median
302.7550
0
181.620a
Mode
Skewness
1.334
Std. Error of
.309
Skewness
0
65.940a
Mode
Skewness
1.987
Std. Error of
.309
Skewness
Minimum
181.620
Minimum
65.940
Maximum
22036.000
Maximum
5235.810
695.45250
Percentile
Percentile
25
25
s
50
2605.5650
0
50
0
75
7352.6775
302.7550
0
75
740
190.1750
621.4425
0
INTERPRETATION Mean of Net Worth for Group A and B companies are 4905.87 and
917.51 and their median score are 2605.56 and 302.75 respectively. In case of group A
companies, mean is greater than median which shows that distribution of data is positively
skewed. Further from the value of coefficient of skewness (+1.334) it can be verified that
group A data is positively skewed. And such degree of skewness (+1.334) can be categorized
into highly skewed.
In group B data, mean Net Worth is more than median, hence it can be interpreted that data
distribution for group B is positively skewed as the value of skewness coefficient is also
1.987. Such degree of skewness is highly skewed.
Hence it can be concluded that in both the cases (Group A and B) is data is highly skewness
and can be consider approximately similar to normal distribution.
Spread of data for both the groups A and B can be observed from Box plot in Figure5. Fig.5
shows group A is spreaded from Net Worth value 181.62 to 22036 whereas distribution of
group B is from Net Worth value 65.94 to 5235.81. Range for group A is 21854.38 (22036 181.62) and for group B is 5169.87 (5235.81-65.94), which shows that there is much
741
significant difference in range of both the groups. Box plot also shows that mean values for
both the groups are not close.
Investors Confidence
Table.6
Comparison of Investors Confidence of Group A and Group B Companies
GROUP
A
GROUP
N
Valid
Missing
60
Valid
Missing
60
0
Mean
13.1058
Mean
19.0782
Median
11.6050
Median
17.2600
Mode
.00
Mode
20.45
Skewness
.770
Skewness
.464
Std. Error of
.309
Std. Error of
.309
Skewness
Skewness
Minimum
.00
Minimum
1.90
Maximum
40.77
Maximum
43.81
25
6.4950
Percentiles
50
75
Percentiles
25
10.5950
11.6050
50
17.2600
18.3200
75
29.5800
742
743
much significant difference in range of both the groups. Box plot also shows that mean values
for both the groups are also close.
Total Assets
Table .7
Comparison of Total Assets of Group A and Group B Companies
GROUP
A
GROUP
N
Valid
Missing
60
Valid
60
Missing
Mean
4542.180233
Mean
947.807350
Median
1956.725000
Median
432.621000
182.7000a
Mode
Skewness
1.672
Std. Error of
86.9800a
Mode
Skewness
.309
2.263
Std. Error of
Skewness
.309
Skewness
Minimum
182.7000
Minimum
86.9800
Maximum
22268.0000
Maximum
5242.5700
25
820.375750
Percentiles
50
75
Percentiles
25
238.987500
1956.725000
50
432.621000
6806.800000
75
1225.142500
744
INTERPRETATION Mean of Total Assets for Group A and B companies are 4542.18 and
947.80 and their median score are 1956.72 and 432.62 respectively. In case of group A
companies, mean is greater than median which shows that distribution of data is positively
skewed. Further from the value of coefficient of skewness (+1.672) it can be verified that
group A data is positively skewed. And such degree of skewness (+1.672) can be categorized
into highly skewed.
In group B data, mean Total Assets is more than median, hence it can be interpreted that data
distribution for group B is positively skewed as the value of skewness coefficient is also
2.263. Such degree of skewness is highly skewed.
Hence it can be concluded that in both the cases (Group A and B) is data is highly skewness
and can be consider approximately similar to normal distribution.
Spread of data for both the groups A and B can be observed from Box plot in Figure7. Fig.7
shows group A is spreaded from Total Assets value 182.70 to 22268.00 whereas distribution
of group B is from Total Assets value 86.98 to 5242.57. Range for group A is 22085.3
(22268 182.70) and for group B is 5155.59 (5242.57-86.98), which shows that there is
745
much significant difference in range of both the groups. Box plot also shows that mean values
for both the groups are also not close.
Sales
Table 8
Comparison of Sales of Group A and Group B Companies
GROUP
A
GROUP
N
Valid
Missing
60
Missing
Mean
6170.160960
Mean
Median
1507.450000
Median
184.1000a
Mode
Skewness
965.0000
2.222
Std. Error of
Skewness
732.740500
Skewness
.309
60
2120.920593
Mode
1.553
Std. Error of
Valid
.309
Skewness
Minimum
184.1000
Minimum
152.0000
Maximum
30029.0000
Maximum
12403.0000
25
830.852500
Percentiles
50
75
Percentiles
25
407.575000
1507.450000
50
732.740500
8040.690000
75
1132.367500
746
INTERPRETATION Mean of Sales for Group A and B companies are 6170.16 and
2120.92 and their median score are 1507.45 and 732.74 respectively. In case of group A
companies, mean is greater than median which shows that distribution of data is positively
skewed. Further from the value of coefficient of skewness (+1.553) it can be verified that
group A data is positively skewed. And such degree of skewness (+1.553) can be categorized
into highly skewed.
In group B data, mean Sales is more than median, hence it can be interpreted that data
distribution for group B is positively skewed as the value of skewness coefficient is also
2.222. Such degree of skewness is highly skewed.
Hence it can be concluded that in both the cases (Group A and B) data is highly skewness and
can be consider approximately similar to normal distribution.
Spread of data for both the groups A and B can be observed from Box plot in Figure8. Fig.8
shows group A is spreaded from Sales value 184.10 to 30029.00 whereas distribution of
group B is from Sales value 152.00 to 12403.00. Range for group A is 29844.90 (30029
184.10) and for group B is 12251 (12403-152.00), which shows that there is much significant
747
difference in range of both the groups. Box plot also shows that mean values for both the
groups are also not close.
EBIT
Table .9
Comparison of EBIT of Group A and Group B Companies
GROUP
A
GROUP
N
Valid
Missing
Mean
60
Valid
Missing
1469.2763
Mean
60
0
181.9028
Median
249.69
Median
83.15
Mode
-10.75a
Mode
7.00 a
Skewness
1.735
Skewness
1.727
Std. Error of
.309
Std. Error of
Skewness
.309
Skewness
Minimum
-10.75
Minimum
Maximum
8289.63
Maximum
929.22
25
116.8700
Percentiles
50
75
Percentiles
25
55.6250
294.6900
50
83.1500
1721.1500
75
271.9900
748
INTERPRETATION Mean of EBIT for Group A and B companies are 1469.2763 and
181.9028 and their median score are 249.69 and 83.15 respectively. In case of group A
companies, mean is greater than median which shows that distribution of data is positively
skewed. Further from the value of coefficient of skewness (+1.727) it can be verified that
group A data is positively skewed. And such degree of skewness (+1.727) can be categorized
into highly skewed.
In group B data, mean EBIT is more than median, hence it can be interpreted that data
distribution for group B is positively skewed as the value of skewness coefficient is also
+1.735. Such degree of skewness is highly skewed.
Hence it can be concluded that in both the cases (Group A and B) is data is highly skewness
and can be consider approximately similar to normal distribution.
Spread of data for both the groups A and B can be observed from Box plot in Figure9. Fig.9
shows group A is spreaded from EBIT value -10.75 to 8289.63 whereas distribution of group
B is from EBIT value 7 to 929.22. Range for group A is 8300.38 (8289.63 (-10.75)) and for
group B is 922.22 ( 929.22 - 7), which shows that there is much significant difference in
749
range of both the groups. Box plot also shows that mean values for both the groups are also
not close.
Conclusion:
Group A Companies have better and comparatively higher governance score and financially
(EPS) perform better than group B companies.
Hence; Corporate governance scores plays a role in improving financial performance of the
organization.
References:
1. Anderson, R. C. and Reeb, D. M. (2003). Founding-family ownership and firm
performance: evidence from the S&P 500. Journal of Finance, 58, 130128.
2. Black, B., 2001, The Corporate Governance Behavior and Market Value of Russian
Firms, Emerging Markets Review 2, 89-108
3. Borokhovich, K., R. Parrino and T. Trapani, 1996, Outside Directors and CEO
Selection, Journal of Financial and Quantitative Analysis 31, 337-355
4. Dalton D R, Daily C M, Ellstrand A E and Johnson J L (1998), Number of Directors
and Financial Performance: A Meta-Analysis, Academy of Management Journal, Vol.
42, No. 6, pp. 674-686.
5. Dhawan Jyothi (2006), Board of Directors and Corporate Governance in Large Listed
Firms in India, The Icfai Journal of Corporate Governance, Vol. 5, No. 3, pp. 39-61.
6. Dwivedi Neeraj and Jain Arun (2005), Corporate Governance and Performance of
Indian Firms: The Effect of Board Size and Ownership, Employee Responsibilities
and Rights Journal, Vol. 17, No. 3, pp. 161-172.
7. Kimber David, Lipton Phillip and ONeill Graham (2005), Corporate Governance in
the Asia Pacific Region: A Selective Review of Developments in Australia, China,
India and Singapore, Asia Pacific Journal of Human Resources, Vol. 43, No. 2, pp.
180-192.
8. Kajola, Sunday O Department of Accounting, Olabisi Onabanjo University AgoIwoye, Nigeria, Corporate Governance and Firm Performance: The Case of Nigerian
Listed Firms, European Journal of Economics, Finance and Administrative Sciences,
ISSN 1450-2887 Issue 14 (2008), Euro Journals, Inc. 2008,Page no. 16,
750
ABDUL ALI
MBA PROGRAMME, GLYNDR UNIVERSITY, LONDON CAMPUS
AMIR M NASRULLAH
ASSOCIATE PROFESSOR, DEPARTMENT OF PUBLIC ADMINISTRATION,
CHITTAGONG UNIVERSITY, BANGLADESH
Abstract
Bangladesh is the 2nd largest exporting country of global apparel products and has become a global
hub for sourcing readymade garments. Nevertheless, compliance issues including employee welfare
services are major concerning and focused issues by the international buyers. The purpose of the
paper is to explore the influence of international buyers on employee welfare of supplier firms. A
qualitative approach using non-probability sampling to select seven participants has been used.
Primary data were collected through face to face and telephonic interviews with top level managers
and operational informants. It was found that the international buyers can influence manufacturing
and exporting firms in providing adequate employee welfare services by the use of setting up
compliance issues, maintaining specific standard, providing guidelines, offering training and extra
support. It also disclosed that labour practice in Bangladesh Garments Industry (BGI) has increased a
lot in last decade and is getting better day by day. The study revealed that customer satisfaction is
linked with provision of adequate labour welfare facilities. However, rendering staff welfare service
is time consuming and costly which considerably affects companies bottom line. Analysing the
influences of international buyers on employee welfare of Bangladesh Garments Manufacturing
Industry enables to identify country specific factors. The managerial perspective would be to
integrate employee welfare services in decision making process and further investigation
opportunities for academies. This paper represents industry specific data from a key global garments
manufacturing country. It highlighted factors such as employee welfare and international buyers in
global supply chain of apparel products.
751
Key words
Bangladesh, Garments Industry, Employee Welfare, International Buyer.
Introduction
Bangladesh is now the second largest apparel exporting country in the world and the leading single
most dynamic and successful export earnings industry contributing 10% of countrys total GDP.
Around 78% of total exports of Bangladesh come from this sector which directly employs3.6 million
people 80% of whom are women (BGMEA,2012).From late 1970s Bangladesh Garments industry has
been developed successively ( Hossan et.al.2012) and survived very well after Multi-Fiber
Arrangement (MFA) phased out in 2004 (Yunus and Yamagata,2012). Though BGI is doing
appealingly well in its industry and contributing significantly in national and international level
however its labour standard, labour management, employee welfare and wellbeing and work-life
balance is questionable. Many international organisations and companies along with ILO are
expressing their concern about that.
752
The main aim of this study is to justify how international buyers can influence compliance issues and
employee welfare and what are the implications of these issues on productivity. To achieve the main
aim the specific objectives are:
1. To find out whether international buyers can influence employee welfare in Bangladesh
Garments Industry;
2. To Determine the relationship between the influence of international buyers and employee
welfare in Bangladesh Garments Industry;
3. To investigate how employee welfare and wellbeing are affected by international buyers;
and
4. To find out whether the employee welfare lead to satisfy customer.
Methodology Followed
A qualitative methodology was applied in this research. Non-probability sampling was used to select
respondents. Primary data were collected through face to face and telephonic interviews with top
level managers and operational informants.
23 RESEARCH DESIGN
This study started from clarifying and understanding problems ended with bringing new insights in
the literature by interviewing key focused groups and using qualitative analysis based on an
exploratory research approach.
753
In this exploratory study one to one interviews using face to face, telephone and electronic
interviews have been conducted based on semi structured interviews. Interviews had been taken
from senior managements, directors and managers from Dhaka and Chittagong the tow largest cities
in Bangladesh over the phone and face to face interviews were taken from some senior personals of
international buying companies and agents based in the UK who source their products from
Bangladesh. The main reasons for selecting two dimensions are to find out the discrepancies
between their statements which can increase the validity of the study.
26 DATA ANALYSIS
In this investigation face to face interviews and telephonic interviews conducted which at the same
time audio recorded and transcribed the summaries. Careful consideration was given in voice and
tones when taking the interviews to avoid misinterpretation. Subsequently, audio recorded
interviews were transcribed into written formats and then summarised. After transcribing and
summarising a rounding up call is made to each telephone interviewees to ensure the information
given is correct.
The overall theme of the interviews was to find out whether international buyers can influence
employee welfare and how. The results of the interviews indicate that there were mix opinions
among the importers and exporters in few issues including how buyers can influence and the degree
of influence. However, on some issues like expected employee welfare, working conditions, fire
safety are common among the respondents.
754
27
28 COMPLIANCE ISSUES AND INTERNATIONAL BUYERS
Compliance issues including labour welfare are getting high priority to global buyers (Haider, 2007).
The global buyers want a secure and sustainable supply chain for that they emphasise on welfare
services of the employees in the whole supply domain. What is regarded as welfare by the
employees and the way how international buyers can perform is illustrated below.
The consumers are much awarer now than ever before due to globalised telecommunication
systems which present a transparent supply chain resulting increased expectation of society towards
the business (Baden et. al.2009). The international buyers who work as a vital linkage between a firm
and many other external constituents (Turner et.al. 1995 in Bendixen and Abratt, 2007) are engaged
in business breaking the physical boundaries of countries across the globe. They are the key power
in international trade and commerce as well as a very influential source in supply chain. The
international buyers especially in business to business dealings are highly concerned about supply
chain (Roberts, 2003; Locke et.al.2007; Haider, 2007; Baden et.al.2009). This concern is imperative to
understand the competitiveness, to identify various links and to focus on long term issues within
that domain for a positive persistent outcome.
Multinational Buyers usually focus on integrated supply chain to accommodate changing market
condition (Norgan, 1994) because when customers decide to purchase anything they trigger the
755
button along the whole supply chain (Slack et.al. 2010). So they recommended choosing appropriate
supplier having trading off substitute features as the ultimate objective is to satisfy customer. If
there is any unexpected issue regarding supply network come under flash light this is likely that the
business will suffer a lot leading to liquidation in some worse cases. A clean supply chain is also a
sustainability and corporate social responsibility issue. A study in UK found Failure to follow it, may
pose a significant risk for the companies (Robert et.al. 2006 cited in Baden et.al. 2009).
Purchasing decision is made by the buyer in their own specification so they can influence the
supplier and it is proved that supply chain pressure is more effective for social and environmental
change than local regulations (Stretcher, 2005 in Baden et.al.2009; Slack et.al.2010).There are
certain areas where international buyers can influence for instance standard labour policy including
not employing child labour, proper employee welfare practice like maximum working hours,
overtime facilities, minimum wage, timely payment as well as job security, following corporate social
responsibility issues, price and so on.
Many critics including (Pretious and Love, 2006; Locke et.al.2007) outlined that most of the
international buyers are in favour of influencing to reduce the price and they put more pressure for
that than other things. They argued that the international companies are after publishing more
glossy gimmick statements about practicing CSR and other green issues than really following them.
Though the international buyers can influence in supply chain but they are keener about price and
delivery times than for other CSR issues like employee welfare related in supply chain (Ibid in Baden
et.al. 2009). However, pressurising suppliers is not always beneficial for the companies. Sometimes
they need to incur costs for that including late deliveries and extra costs. Besides these, placing extra
condition on buying decisions is seen as an extra burden by the suppliers (Baden et.al.2009).
Carstensen (2008) criticised excessive buyers power claiming that it exploits producers or supplier
firms.
Form above discussion it is clear that International companies can bring to bear different kinds of
pressure to the suppliers during their procurement. Some of those are because of companys legal
requirements by international regulatory bodies and law of particular countries. When companies
grow bigger, they need to focus highly on building ethical codes of conduct at least for the gimmick
advertisement, certain specification for their suppliers leading suppliers to follow the requirement as
756
they have very limited options to deny (Baden et.al., 2009). Moreover, when a rational conscious
customer purchases a product his or her purchase behaviour is influenced by the sourcing decision
of the company which means the CSR criteria of companies. Therefore, when organisations take
consumers decision into consideration they need to pressure and influence the supply network in a
positive way. Local authorities also bind companies to pursue some strategies for compelling
suppliers following certain code of conducts.
30 EMPLOYEE WELFARE
The word Welfare came from the French Phrase which stands for Fare well. It is defined as the
prosperity, happiness and general blessing of life (Swapna, 2011). For establishing a respectable
industrial relation in any cultured society welfare is an essential fact (Hong et.al.1995; Swapna,
2011). Every worker in the industry is eagerly expecting at least minimum amenities in this present
modern world. So, to improve the living conditions of employees it is vital for employers to provide
appropriate welfare facilities. Employee welfare is an employer sponsored benefits which is a key
concern of both employees and managers (Dulebohn et.al.2009). They claimed that remaining
competitive in labour market depends to a great extent on its employee welfare decision.
Employee welfare is the facilities beyond the statutory requirement offered by the owners to
employees for their well-being (Davis and Gibson, 1994; Dulebohn et.al.2009; Durai, 2010; Swapna,
2011).Todd (1993) in Durai (2010) mentioned, For the purpose of improving social and intellectual
comport of employees whatever an organisation provide over and above the minimum wages and
necessity of the industry is the employee welfare. He mentioned welfare are two types statuary
facilities required by law of the particular land and non statutory what are not mandatory by law.
Employee welfare services improve their morale, job satisfaction level, commitment, loyalty,
engagement, efficiency and high level of employee retention, physical and mental health which
helps to focus on specific job ensuring organisational citizenship.
Authors like Aswathapa (2007) and Agalgatti (2008) have mentioned eight approaches about labour
welfare facilities. They are briefly delineated below:
1. Policing theory:
This theory states that owners and managers can exploit employees in many ways. To minimize that
country or government plays a role as a policeman and force managers or concerning authorities to
provide necessary welfare facilities. It also stressed that non compiler will be punished.
2. Religion theory:
This theory implies that anything good or bad is seen as an investment stating that results of todays
work will be harvested tomorrow. Employers are inspired on this belief and provide adequate wellbeing facilities.
3. Philanthropic theory:
Being affectionate to mankind providing good working conditions, canteens and other facilities are
the basis of philanthropic theory of labour welfare. This theory is mainly used in social welfare.
4. Paternalistic theory:
This theory refers that total assets, properties and profits are hold by the industrialists based on
trust. They hold it for their use as well as for the benefits of worker. This theory is also known as
trusteeship theory. This trusteeship is not actual or legal but moral and employers should use the
fund in their control for the betterment of labours.
5. Placating theory:
This theory is based on the supposition that when employees are organised and rebellious welfares
will be facilitated. So, providing appropriate welfare peace can be established in any company.
758
According to this theory, creating an impressive intuition in the workers and other stakeholders
mind welfare services are provided. Some employers use this to enhance public relationship with
other companies.
7. Functional theory:
This is also called efficiency theory of labour welfare. It states that increasing the effectiveness in
production and productivity, securing as well as preserving efficiency is the main purpose of
providing welfare services.
8. Social theory:
According to this theory a firm is morally responsible to provide welfare to its employees for the
purpose of improving lifestyle in the society. Labour welfare in broader sense becomes social
welfare.
These models are widely used in almost all organisations depending on its nature, corporate values,
cultures and geographical locations those are practicing and providing labour welfare facilities.
Swapna (2011) mentioned that capital and manpower are two wheels to run an industry
simultaneously wages and welfare facilities are the two wheels to run employee performance and
morale. Employee welfare is recognizing needs, wants and expectations of workers in an
organisation and come up with the ideas, things and materials to facilitate them fulfilling those. For
pleasant industrial relations superior working environment and satisfactory provision of welfare
package is indispensable. Employee welfare consists of social and economic contents which have
both positive and negative aspects. It is necessarily flexible which varies with times, with the size of
the organisation, available resources from one culture to another and one country to another with
different degrees of industrialisation and different level of social and economic development (Davis
and Gibson, 1994; Swapna, 2011).
Providing welfare services boost employees efficiency in production and productivity with the help
of effective utilisation of resources. This programme assists in cutting down waste, employee
turnover, absenteeism, labour disputes and grievances among the workers (Davis and Gibson, 1994;
Swapna, 2011).
759
Davis and Gibson (1994); Dulebohn et.al (2009); Swapna, (2011) stated some common welfare
facilities expected by employees are favourable working conditions, equal pay for equal work, fair
treatment, encouraging remuneration, freedom to join trade unions, employee representation, right
to rest and leisure as well as recreation, part time off, paid holidays, sickness pay, medical facilities,
child care, uncertainty support, food and housing benefits, limited working hours, overtime facilities
and payments, disability issues, life insurance, pension plans, family and social protection, stock
ownership and economic security.
Therefore, employee welfare is something provided by the employers which is beyond required by
law to influence, motivate, engage and to build a rapport with the organisational human capital in
thriving its strategies. However, organizations have some pay offs for providing employee welfare
and wellbeing facilities (Davis and Gibson, 1994). Providing competitive welfare and benefits in
product and service market brought about by globalisation is expensive for the company and
sometimes are treated extra burden (Dulebohn et.al.2009). There is a significant implication of
employee benefits decision which consists of one third of total labour costs on companys bottom
line and this costs increase gradually over the time (Hewitt, 2002 in Dulebohn et.al.2009). Not only
employee welfare helps organisation in numerous ways but also its costs a significant amount of
organisations profit. Moreover, measuring employee welfare is not obvious because what is seen as
welfare for someone might not be for others. Besides, during financial difficulties companies are
struggling with meeting statuary requirements then extra facilities will be burden (Durai, 2010).
Though employee welfare and a benefit is an integral part of an organisational decision but is
surprisingly not given proper consideration in strategic decision. Deadrick and Gibson, 2007 in
Dulebohn et.al.2009 mention that the largest gap in an organisation exists in employee benefits and
compensation.
760
Locke et.al.2007; Baden et.al. 2009; Galland and Jurewicz, 2010; Slack et.al.2010). Nonetheless the
buying firms need to be strong enough in terms of its dimension, economies of scale and market
positioning to be able to put a control on supplier firms (Carstensen, 2008).
Global apparel sourcing market is dynamic and fiercely competitive (Baral, 2010) as there are lots of
countries especially developing ones with abundant labour force lacking financial investment are
producing and exporting garments products with the help, support and patronization of
international companies (Baden et.al. 2009). As a result, the sourcing companies can place
conditions about employee welfare on their supplier firms during their sourcing process and if not
followed can change the suppliers. Many international companies are not only putting conditions
but also in many cases they offer employee welfare facilities including training and development for
the employees including children as well as family welfare facilities (Baral,2010).However, changing
suppliers does not always provide good options as the relationship is based on trust and building
trust is a long term process. Other than this switching a supplier does incur costs and having an
appropriate supplier is also a daunting task.
International buyers can persuade supplier firms by inserting certain conditions because they are
large. Baral (2010) revealed that readymade garments industry are catching the eyes of customers,
social workers, branded international buyers and welfare organisations. He claimed that buyers look
into the code of conducts of an organisation before placing an order highlighting that compliance of
expected conditions set by the buyers is considered more important than product quality. Galland
and Jurewicz (2010) pointed out that Local laws, brands compliances obligations put pressure on
suppliers to raise remuneration, decrease extreme overtime hours, and sheltered autonomy of the
union as well as to improve health and safety facilities for the workers.
Ethical consideration makes buyers set and follow certain a code of conducts. Companies
Considering ethical issues with the importance in industrial purchase is widely accepted and
practiced by many firms (Haynes and Helms, 1991; Kitson and Campbell, 1996, in Pretious and Love,
2006; Slack et.al.2010). With the increasing demand of globalisation, global sourcing of apparel
products improved tremendously for the sake of reducing costs and time with improved quality.
Many apparel and Readymade garments industries are located in developing countries (Locke
761
et.al.2007) like China, Bangladesh, India, Indonesia, Cambodia and other countries where ethical
issues are not identical.
The global buyers or importers of garments products are based on developed countries in most of
the cases. Many giant brands in the world are the main importers of Bangladesh apparel products
including Wal-Mart, GAP, ZARA, Mark and Spencer, Tesco, PUMA, GAP, LEVIS, UNIQLO, H and M and
many more global brands (BGMEA,2013).Some writers like Carter (2000) cited in Pretious (2006)
asserted that taking ethical dimension into consideration uplift organisations image and reputation.
Nonetheless, Pretious and Love (2006); Locke et al. (2007) claimed that companies are after taking
advantage of lower labour costs, weak social and environmental regulations in the suppliers country
to produce cheap products at the expense of local workers welfare.
To influence the suppliers in decision making, such gigantic buyers can set a specification with the
standard of the quality expected. Conversely, just setting the standard does not mean that suppliers
will follow the code of conduct because of lack of understanding about the context of ethical issues
(Slack et.al.2010) they need to be monitored. Locke et.al (2007) found in The Nike, a global apparel
retailer that monitoring does improve working condition. Slack et.al (2010) mentioned that local
suppliers can be monitored relatively easily but monitoring international suppliers is troublesome
with diverse traditions and ethical standards, social, cultural and religious differences. The
monitoring group can be the buyers or their appointed individuals, independent observers and
organisation like ILO and Clean Cloths Campaign, trade unions, government bodies and NGOs (Locke
et.al.2007; Merk, 2009).
Purchasing practices by multinational buyers do impact on employee welfare (Galland and Jurewicz,
2010). If the buyers keep on changing the specification it will be difficult for suppliers to cope with
larger demand within a shorter time period. So they will use extra labour, excessive overtime and
may use employees beyond the standard required level. So, they proposed to select one supplier for
the proper co-ordination between the parties.
762
From the reviewed literature it can be found that there is a gap in both influences of international
buyers and employee welfare facilities. Provision of employee welfare facilities should be assessed
first according to the necessity of particular organisation before setting it up which needs extensive
research based on industrial context (Davis and Gibson, 1994). Hong et.al (1995) discussed employee
welfare and the effectiveness of providing employee but missed highlighting how this welfare can be
carried out. Schmitz (1995) has shown gap in industrial buyers and sellers relationship which is
encouraging for researching industrial buyer behaviour and influences on supply network. Pretious
and Love (2006) talked about ethical issues during product purchasing and how codes of conducts
companies can follow. They also highlighted various opportunities for further research. They could
have talked more about cultural and religious dimension in setting up ethical codes of conduct. The
influences of other influential bodies and intermediaries could have been highlighted. Bendixen and
Abratt (2007) recommended contextual research on the buyer and suppliers relationship in terms of
playing their role. Carstensen (2008) argued that buyer power in the business domain has raised a
number of issues which need comprehensive analysis.
From above analysis it can said that international buyers do have great influences on employee well
and they certainly exercise some in a form of compliance issue. However the degree in which buyers
can exercise their power rely on the size of the firm, industry, geographical location, cultural
differences and legal codes of conducts of a particular country.
33
34 SAMPLE DESCRIPTION
In this research, there were seven respondents of whom three were UK based Importers and four
were exporters from Bangladesh. The respondents were senior managers and directors including top
personals on merchandising department and production department.
35 INTERVIEW SUMMARY
For maintaining the anonymity as promised with the interviewees neither the respondents nor the
respective organisations could be identified in subsequent writing up of the interview data. The
interview summary is highlighted below:
763
Buyers are interested in low-cost quality products and maintenance of compliance issues
Participants comments about the interests of buyers on employee welfare were almost same saying
that they are interested because this is a compliance issue. However, they are more interested in
low-cost quality products and proper maintenance of compliance issues. Whether buyers can
influence employee welfare the response yes they can by giving guidelines, putting extra conditions,
providing counselling, offering training as well as visiting the factories and expressing concern about
unexpected issues.
764
35.1
35.2 WELFARE
PROVISIONS
MOTIVATE
EMPLOYEES
AND
LEAD
TO
BETTER
PRODUCTIVITY
Baral, 2010). With only two exceptions, interviewees expressed common agreement on poor labour
practice in Bangladesh Garments Industry. Fairly typical comments were: .....Only few companies
follow labour laws and international standards. Labours do not get their expected standard
treatment (Operation Manager, Dhaka, Bangladesh, Exporting Firm)
So it can be said that labour practice in Bangladesh Garments Industry is not up to the standard.
There were nearly common answers between the importers and exporters regarding expected
welfare services by employees. The most universal welfare facilities are good working conditions,
joining in the trade union, on time payment, overtime facilities, Job security, fire safety as well as
health and safety issues (Davis and Gibson, 1994; Dulebohn et.al, 2009; Swapna, 2011). Moreover,
there are some other issues highlighted like holidays, breaks, better treatment, food and travel
allowances and bonuses.
International buyers can influence suppliers to provide employee welfare (Schmitz, 1995; Roberts,
2003; Pretious and Love, 2006; Locke et.al.2007; Baden et.al. 2009; Galland and Jurewicz, 2010;
Slack et.al.2010). In this investigation all but one suggests the same. Responded mentioned: They
765
can influence us giving guidelines, setting up compliance issues including fire safety (Merchandising
Manager, Saver, Bangladesh, Exporting Firm)
From above analysis it can be said that international buyers can influence employee welfare in
Bangladesh Garments Industry by providing order specification, maintaining determined compliance
issues and setting up benchmarks (Objective -1).
With only one exception all the participants supported that when buyers place orders with
specifications on it. They put conditions including employee welfare and other compliance issues
(Haider, 2007; Baral, 2010). So, as many buyers are coming in Bangladesh with different specification
along with certain universal requirements for employee welfare. This tendency shape and increase
the provision of welfare facilities in Bangladesh Garments Industry.
There is a positive relationship ..... when buyers put pressure and conditions then the supplier firms
have no option but follow that or lose the order....... which is a kind of coercive power. (Director,
Exporting Firm, Chittagong, Bangladesh)
Pretious and Love, (2006); Locke et al (2007) claimed that majority of the international buyers want
low cost but quality product which this study found true. So many firms do not care about other
firms employee welfare. I do not think there is any direct relationship as many international firms
are after getting cheap but quality products not the employee welfare. Nonetheless, there may not
have any direct relationship but indirectly buyers expectation add value in shaping employee
welfare in supplier firms. Stretcher, 2005 in Baden et.al.2009; Slack et.al.2010 recommend similar
result claiming that in shaping employee welfare supply chain pressure is more useful than local
regulations. As a result, It can be drawn from that there is a positive relationship between the
influence of international buyers and employee welfare facilities in Bangladesh Garments Industry
(Objective-2).
International buyers are bound to follow the international standard of labour practice as well as
labour law in particular country despite some exceptions. Apparel products in Bangladesh are export
oriented which made plenty of international companies the buyer of Bangladeshi Garments
766
products. They put priority on compliance issues employee welfare facilities is one the core
compliance issues.
For maintaining employee welfare we guide them, provide counselling and visit the factories to
observe the conditions of working environment (Purchasing Manager, importing firm, London, The
UK)
From above illustration it can be represented that Employee welfare and wellbeing are affected by
international buyers through setting up specification, following the code of conducts, visiting the
firms, guiding as well as counselling them and providing training (Objective-3).
Davis and Gibson, 1994; Swapna, 2011 proposed that providing adequate welfare facilities increase
efficiency that is congruent with the findings of this study. Customer satisfaction depends on several
elements including its quality, service and in a word overall experience of consuming a products or
service. Product quality is directly related with the way it is made. A satisfied labour can produce
better quality products. To make an employee satisfied several non statutory facilities like welfare
services need to be provided.
........better and perfect quality can be maintained by providing adequate welfare facilities
(Purchasing Manager, importing firm, London, The UK)
.......welfare keeps employees motivated which increase their productivity with increased quality
((Merchandising Manager, Exporting Firm, Saver, Bangladesh)
So, from above argument it can be said that provision of adequate welfare facilities lead to satisfied
customer (Objective-4).
767
Many authors like Schmitz (1995); Roberts, (2003); Locke et.al. (2007); Baden et al. (2009); Galland
and Jurewicz, (2010) claimed that buyers can influence suppliers decisions that is supported with the
findings of this study. For the purpose of improved productivity with high quality with a view to
enhancing social and intellectual comport of employees whatever an organisations endow with
beyond the statutory requirement of that particular industry is employee welfare (Davis and
Gibson,1994; Dulebohn et.al 2009; Swapna, 2011).Influence of international buyers play a significant
role in determining employee welfare of supplier firms (Schmitz, 1995; Roberts, 2003; Pretious and
Love, 2006; Locke et.al.2007; Baden et.al. 2009; Galland and Jurewicz, 2010; Slack et.al.2010).
However, Carstensen (2008) argued that buyers can influence only when they have expertise and
gained economics of scale.
Thus while previous researchers have identified influences of buyers on supply chain and suppliers
decision on employee welfare there remains a gap in understanding how much and in which way
buyers actually can influence employee welfare. By exploring the association between the employee
welfare and influence of international buyers, this study intended to fill the gap. It showed that there
is a positive relationship between buyers influences and employee welfare. It is found that for
better quality products, motivated employees in producing firms are essential. To motivate
employees, providing welfare and wellbeing services are indispensable. Buyers can influence
suppliers by putting conditions about providing adequate welfare facilities in compliance issues
when placing order. As a result, international buyers can influence employee welfare in supplier
organisation.
37
38 RECOMMENDATIONS OF THE STUDY
This investigation suggests a number of potential strategies and actions that managers and owners
of Bangladesh Garments Industry may adopt in order to boost the productivity and perfect quality.
First of all, Bangladesh is facing lots of problems in exporting products across the globe including
high competition with global apparel manufacturing giants with advanced technology like China and
768
India. Poor labour productivity, political instability and high lead time which is the time taken
between receiving an order and delivering it with proper specification. All of these made the
industry inefficient in spite of being the second largest exporter in the world. Findings from this
study suggest that lead times can be reduced and productivity can be increased providing
satisfactory employee welfare. The findings highlighted that, welfare pleases employees and
contented workers are highly motivated which enhance their productivity. When productivity
increases it reduces the time to deliver an order. So, organisation ought to take employee welfare
service
with
great
care
for
their
survival.
To attract the foreign buyers the industry may concentrate more on compliance issues including
welfare facilities which will enhance the image of industry across the globe. A good reputation works
very well in the global business arena.
Additionally, what foreign buyers expect in terms of compliance issues from the supplier companies
also found in the findings which suggest management of supplier organisations to take necessary
steps in order to secure consistent bids from buyers.
In addition to that, this investigation also proposes to international buyers about possible matters
where they can influence. Desired welfare facilities by the workers in Bangladesh Garments Industry
were also suggested in this study which will be useful for the buyers to contemplate on their
interested issues.
Finally, for the purpose of securing and maintaining a steady pace of export in Bangladesh Garments
Industry as well as thriving for the worldwide apparel exporting leader concentration on compliance
issues including employee welfare services for productivity and quality also suggested from the
findings.
39
40 CONCLUSION
This study was devoted to inspect the influence of international buyers on employee welfare using
the perspective of Bangladesh Garments Industry. The research is accomplished using earlier
769
literature supported by the results recognised from a qualitative analysis incorporating a sample of
participants for interview.
The findings of this investigation advocate that if employees are treated with proper amenities and
endowed them with adequate welfare and well-being facilities they are more motivated, when they
are inspired they work hard which increase their productivity and quality of their work. This assists in
reducing lead times, upholding accurate quality and maintaining on time delivery with perfect
standard which make ultimate consumer happy. This whole cycle persuade buyers to influence
suppliers in providing necessary welfare facilities for employees. The study found that the buyers are
able to influence their suppliers in decision making process.
Besides, this study advised that for upholding a sustainable development of Bangladesh Garments
Industry rigorous attentiveness ought to be devoted towards the development of labour welfare
services. Though, study found that it has achieved some of the global standard but yet a lot to go for
its triumph and become a true global leader.
Nevertheless, the study got a number of limitations and weaknesses, such as small sample size,
relevant to only one industry in a particular country. However, this investigation put forward huge
opportunities for further research which will bring more insights in the literature and in the explored
industry.
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at[Electronically
Abstract
Micro Enterprises (ME) are considered as the major sources of employment creation.
Global experiences show that an efficient ME sector is conducive to industrial growth and a
flexible industrial structure, which are the cornerstones of a vibrant entrepreneurial economy.
Current studies show a strong link between entrepreneurship and economic development
(ED). Despite these recognized importance, MEs face severe problems and challenges in
DCs. They lack appropriate policies and programme to promote MEs towards ED. The
challenges of business entry, survival and growth are often substantial. The availability of
financial resources, lack of capacity to handle complex business management issues, as well
as complicated and bureaucratic environment present major obstacles. As a result, there is an
urgent and continuous need for policy development to improve the situation. The aim of this
paper is to critically examine the MED Policies (MEDP) of Bangladesh after Liberation
(1971-2011). This paper will also examine the evolution and development of MED policies of
some selected DCs, especially, India, Pakistan, and Sri Lanka with a comparative overview.
This study will offer a list of practical recommendations to formulate a coherent and
comprehensive MED policy based on the study findings. It is hoped that these
recommendations will provide appropriate inputs to the policy makers and concerned ME
stakeholders in the DCs, particularly Bangladesh and more generally to the MED literature.
Key Words
Introduction
Micro Enterprises (MEs) have been recognized as a major source of job creation in
the world that make important contributions to socio-economic development. Although the
role of MEs is different at different stages of economic development (ED), their role is
particularly important for developing countries (DCs). Beck (et al. 2005) has found a strong
association between micro enterprise development (MED) and GDP per capita (Moazzem
2008). The word micro enterprise has as many interpretations as they have applications. It
has been used inter-changeably by the researchers, policy makers, and business advisors.
775
They are informal sector, small business, small firms, small-scale industries (SSI), small scale
enterprise (SSE), small and medium enterprise (SME), medium and small scale industry
(MSSI), micro, small and medium enterprise (MSME) and micro enterprise (ME) etc.
Variants of expressions are used among and within the different countries. For example,
small business is generally used in the USA, small firm is generally used in the UK and
European countries, and while in the south Asia, the term small and cottage industries is
used more often. In the Caribbean countries, the term vendor, hucksters, haggler and
trader is used to describe the persons who carry out trades in small business (ILO 2001).
Whatever the name is used, this sector is a potential instrument for employment generation
and poverty reduction, even though they are treated as missing middle, as such, remained
neglected for ages in the DCs.
In DCs, MEs are seen as a major self-help instrument for poverty eradication. In
transition economies, they provide the best illustration of the changes in ownership structures,
business culture and entrepreneurial behavior over the past decade. One of the major
challenges to governments is to encourage entrepreneurs to engage in MED. In pursuing this
goal, governments have moved away from earlier, rather simplistic approaches, recognizing
that MEs not only create jobs but also play a wider role in socio-economic and political
development. In achieving this goal an appropriate policy is essential.
Official MEDPs can be evaluated against their impact upon enterprise culture, startup, survival of MEs, and stakeholder empathy. MEDPs in Western Europe, for example,
focused on employment creation in the late 1980s and early 1990s. By the end of the century,
the emphasis had changed to international competitiveness and innovation. As a result, policy
targets moved towards technology issues and creation of an enterprise culture. In transition
economies, a major focus has been upon creating an enabling environment for the market
economy. Hence much of ME policy has targeted the building of an appropriate regulatory
environment, privatization and restructuring, development of the financial sector and
mechanisms for private and public ME support. In addition to ME policies, many countries
have adopted ME legislative acts, including such countries with economies in transition as
Russia, Hungary, Poland, the Czech Republic and Bulgaria and DCs such as India and
Pakistan. Within the national framework, acts may specifically target the local level. Their
content varies but usually includes a declaration of ME support, a definition for public policy
purposes and principles on which support for the sector will be based (OECD 2004).
776
Governments can have a profound effect on how all enterprises particularly MEs,
operate and their opportunities to grow. Indeed, government policy and its influence on the
institutional environment of a country, region, or locality has become a key focus of efforts to
help improving how MEs develop and economies compete. As a result, almost all the
countries now have an active policy for improving competitiveness within which, a strong
element focused on what, in policy terms, are usually referred to as MEs. There are three
main dimensions to the governmental role in MEPD:
Government as Regulator
Government rules determine how trade rules operate both nationally and
internationally, and the legal form of companies, the extent of legal limits on company
liabilities and the strength of anti-trust, restrictive practices and anti-monopoly regulations.
Government as Economic Agent
Government taxes, charges, fees, raise debts and spend. The way in which this
operates has a profound effect on business finance and risk taking.
Government as Strategic Planner and Promoter
Government finance can be used to offer grants, subsidies, loans or information and
advisory support to MEs; and can seek to improve the infrastructure of business factor inputs.
The rationale for government intervention to MEPD is considered because it will
indeed enhance the growth of MEs. But there are some obstacles and barriers occur, because
of failures of some sort: failure in the market, failure in governance and failure in the
economy. Government intervention can only correct these failures. The nature of failures,
whether it is in the market, in governance or in economic systems will determine what sort of
intervention should be considered.
Micro Enterprise Policy Development: Different Government Interventions
Generally, the following are popular interventions practiced by the governments
throughout the world which broadly correspond to the ME policy elements of the OECD
framework.
Developing an Enterprise Culture
The rationale for developing an enterprise culture is that if individuals in society
develop a more entrepreneurial mindset then there is a greater likelihood of them considering
the entrepreneurial option for themselves. If policies can make business entry more attractive,
individual are other things being equal, more likely to start up a business.
Correcting Market Failure in Accessing Finance
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MEs are more likely to be subjected to financial constraints than LEs. Governments
have therefore chosen to use public funds to enable MEs to overcome these constraints.
Popular approaches are: loan guarantee scheme, grants to MEs and equity finance.
Supporting Technology and Innovations
Policy makers support the innovatory abilities of the prospective and existing MEs,
because they believe that such businesses will increase economic growth in the country. Such
interventions are usually justified on the ground of imperfect information or spillover market
failures. Hence, the argument is that public policy has a role in facilitating the development
of such spillovers.
Supporting Particular Groups
Public policies should have also been directed towards particular groups in the
society: women, ethnic minorities, the unemployed and the young people, to enable them to
be more enterprising.
Objectives of Micro Enterprise Development Policies: Lessons for DCs
Having a strategy implies having objectives and targets, and therein lies a problem for
policy makers. The objectives of ME strategies are often not explicit. EU publications, such
as white paper Growth, Competitiveness, Employment: The Challenge and Ways Forward in
the 21st Century, 1993, have emphasized on the objectives of employment growth, economic
growth and competitiveness of enterprises and these appear to have had some impact on the
policies of member states. Nevertheless, to be able to understand and evaluate strategies, the
objectives must be explicit. The EU member states pursued four main objectives in ME
policy (Koning et al.
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Industrial Policy 2005 mentioned that MEs would be established on a greater scale
across the country in order to bring about poverty alleviation, unemployment reduction and
creating more employment opportunity so that national economic growth can be attained. To
this end the government took the initiatives to draw up a separate ME policy with a view to
provide necessary guidelines and strategic assistances throughout the country.
Following the plan of introducing SME policy, a document titled Policy Strategies
for Development of Small and Medium Enterprises (SME) 2005 was formulated. The policy
strategy proposed 11 broad objectives. However, the document shows trails of incoherence
and incompleteness in many places. For example, the document does not have any critical
analysis of needs for specific measures proposed and principles for providing support to
SMEs have not been set. There is no indication for defining or determining the criterions for
nurturing and collaborating with civil society institutions to deliver needed services,
leadership, initiation, counseling, mentoring, tutoring etc. Eleven broad sectors have been
identified as boosters sectors, although it is not clear what does it mean. These criteria are
enough to exclude all potential new entrepreneurs who plan to start business with support
designed under the policy. As a whole, there is a move towards making MEs functional and
vibrating for unleashing its full potential in Bangladesh. However some critical inconsistency
and misalignment may be important to be resolved for the betterment of the sector (Raihan
and Rummana 2007).
Recently the government has passed her new Industrial Policy 2010 that aims at
increasing industrialization in the country and maintaining a balanced control over the
national economy. The new policy emphasizes on continuous balanced partnership on
entrepreneurship development for rapid industrialization and development of the country. It
redefined MEs for the benefit of banks and financial institutions, but still not satisfactory. The
following table shows the current definitions of MEs:
Table 1: Definition of MEs in IP 2010 of Bangladesh
ME
Manufacturing MEs
Non-manufacturing MEs
Category
Medium
In
manufacturing,
Industry
/Enterprise
with assets worth BDT 100 to 300 employ 50 to 100 and have assets worth
million (minus land and factory BDT 10 to 150 million.
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In
manufacturing,
Industry
/Enterprise
with assets worth BDT 5 to 100 to 25 and have assets worth BDT 0.5 to 10
million and/or 25 to 99 workers.
manufacturing,
million.
Micro
In
Industry
/Enterprise
with assets worth BDT 0.5 to 5 or less people and have assets worth BDT
million and/or 10 to 24 workers or 0.5 or less.
less.
Cottage
In
manufacturing,
Industry
/Enterprise
with assets worth BDT 0.5 to 5 employ 10 or less people and have assets
million and/or 10 to 24 workers or worth BDT 0.5 or less.
less.
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emerged as core promotional agencies at national level. The era provided the supportive
measures that were required to nurture MSEs, in the form of reservation of items for their
exclusive manufacture, access to bank credit on priority through the priority sector lending
programme of commercial banks, excise exemption, reservation under the government
purchase programme and 15% price preference in purchases, infrastructure development and
establishment of institutes for entrepreneurial skill development. MSME-Development
Institutes [earlier known as Small Industries Service Institute (SISI)] were set up all over
India to train youth in skills/ entrepreneurship and Tool Rooms were established for
providing technical services essential to MEs as also for skill training (Raihan and Rummana
2007).
A high watermark in the evolution of the MED policy was the Industrial Policy
Statement of 1977. It was then that the protection of small industry touched its acme. Special
attention was given to the `Tiny Sector defined as enterprises with investment in plant and
machinery of up to Rs. 1 lakh and situated in towns and in villages with population less than
50,000. Special legislation was planned under this policy to be introduced to give due
recognition and adequate protection to the self-employed in cottage and household
enterprises. The focal point of development for small sector and cottage industries was
planned to establish instead of big cities and state capitals to the district headquarters. In the
year 1978, the central government launched a programme of establishing district industries
centres to provide under a single roof all the support services, clearances, licenses and
certificates required by the small entrepreneurs. There are more than 400 such centres, one
each in a district. Special arrangements for marketing of ME products were made by
providing services such as product standardization, quality control, and marketing surveys
etc.
In the 1980s and 1990s
The recognition of the importance of ancillary industry found expression in the policy
statement of 1980, which laid emphasis on ancillaries. Moreover, the programme for the
development of rural and backward areas was accelerated. The Industrial Policy of 1985
made incremental changes and took into account the impact of inflation. The new policy for
Small, Tiny and Village Enterprises of 1991, laid the framework for government support in
the context of liberalization, which sought to replace protection with competitiveness to
infuse more vitality and growth to MSMEs in the face of foreign competition and open
market. Supportive measures concentrated on improving infrastructure, technology and
quality. Testing Centres were set up for quality certification and new Tool Rooms as well as
783
extent implemented small-scale business promotion policies. However, these policies were
limited in their scope, to begin with, and are not in line with the dynamics of present time.
There has been concern that in Pakistan the ME sector could not realize its full potential.
MEs continue to suffer from a number of weaknesses, which hamper their ability to take full
advantage of the opening of economy and the increasingly accessible world markets. The
areas of constraints are normally identified as labour, taxation, trade capacity, and finance
and credit availability. Pakistan initiated ME promotion through formation of the West
Pakistan Small Industries Corporation. Although the corporation created an impact in its
early years yet its Provincial successors could not sustain its contribution due to various
limitations, such as, over emphasis on industrial and manufacturing activities with little focus
on service sectors; over emphasis on hardware support (land, electricity, machinery) with
little or no emphasis on software support, i.e. information, business development services;
lack of coherent policy framework that determines the role of all relevant stakeholders other
than the dedicated institutions created for small scale industry support; and lack of
complimentary skill development initiatives. It is understood that despite previous efforts the
SME sector did not receive due priority on account of segregated efforts and nonconsolidation of programmes to achieve well targeted results (Raihan and Rummana 2007).
In the 1980s and 1990s
The Youth Investment, Yellow Cabs and Self-employment promotion initiatives of
the 80s and 90s followed the small-scale industrial promotion policy of the 60s and 70s.
These schemes were limited in scope and designed as such that they did not address the core
issues of enterprise development and employment growth and suffered from political
manipulation accruing to bad loan port folios of the banks and loss of public funds. These
schemes contributed little in economic growth and employment creation. In some ways these
initiatives created the mindset of the banking community that is to date, responsible for a
cautious stance towards ME financing in Pakistan. The Small and Medium Enterprises
Development Authority was established in 1998 in order to foster the development of MEs in
the economy and was expected to take a key role in this process. Its functions included, inter
alia, the facilitation on policy making and the provision of overall planning, programming,
research and evaluation of matters related to MEs; monitoring and evaluation; encouraging
and facilitating MED and to protect the interests of ME sector.
In the New Millennium
Pakistan constituted the SME Task Force in 2004, which was to define the basic
elements of the SME policy. The Task Force identified that implementing change requires
785
formulation of a MED policy and assigning specific responsibilities for its implementation
and continuous improvement. The SME Policy 2007 was the outcome of the Task Force
report, the objective of which is to provide a short and a medium to long term policy
framework with an implementation mechanism for achieving higher economic growth based
on ME led private sector development. The vision of the policy is SME led economic
growth resulting in poverty reduction, creation of jobs and unleashing the entrepreneurial
potential of the people.
The policy statement is to create globally competitive SMEs by creating a hassle free
business environment, ensuring provision of modern infrastructure and institutional support
structures for access to resources and services. The government shall take measures for the
promotion of women entrepreneurship, cluster development and also focus on
neglected/untapped sectors of the economy. Strengthening industry-academia linkages shall
also be a key feature of the policy. The policy put MED at the centre stage of all economic
growth policies of Pakistan. It also offers viable options for private sector led growth that will
create huge jobs. Public-Private partnership was also empathized in policy (GoP 2007,
Raihan and Rumanna 2007).
MEDPs of Sri Lanka
Earlier Policies
Although in Sri Lanka, the industrial sector, as a focus of economic policy, was
neglected during the colonial era, it was also given little attention during the 1950s and
1960s. Until the late fifties, industrialization did not receive much attention due to the relative
contemporary prosperity of the country brought about by favourable market conditions for
traditional exports. Afterwards, Sri Lanka faced a number of economic problems, such as the
balance of payments deficits, unemployment, slow economic growth, etc. Such problems and
challenges led to various policy changes including import substitution industrialization
policy. In 1965, a new policy package was introduced through the White Paper of 1966 on
foreign investment. It was an attempt to attract FDIs into the industrial sector with a view to
enhancing the technological and managerial capabilities of local industry. Under the scheme,
MEs had some advantages because they were allowed to import raw materials at the lower
official exchange rates, while LEs had to import raw materials at the higher premium
exchange rates.
In 1970s, there was a notable shift of emphasis from import-substitution
industrialization to export-oriented industrialization in Sri Lanka like other countries. In
1970, the newly elected government moved back to the pre-1965 style control regime. The
786
government ideology was of state capitalism. Heavy and essential industry was reserved for
state ownership. The allocation of resources not only between industry and other sectors but
also among different industries was determined by the state. In 1978, a more market-oriented
economic policy package was introduced, comprising: liberalization of import trade and
exchange payments; abolition of the dual exchange rate practice, devaluation of the currency
and the introduction of a unified exchange rate system within a floating exchange regime;
removal of a number of key price controls; adoption of measures to attract FDIs such as the
setting up of Free Trade Zones, privatizing existing public ventures, introducing new
institutions to support export promotion (Lakshman 1986). The banking system was also
liberalized, with interest rates being allowed to fluctuate and the opening of private and
foreign banks.
In the 1980s and 1990s
Although economic difficulties were experienced again in 1983 and the late 1980s,
further liberalization policies to achieve a free-market economy were put in place in 1989. In
1991, a new government came to power but the liberalized economic policy has continued. It
is the third phase of the liberalization, according to Dunham and Kelagame (1995), the MEs
have generally failed to take advantage of the opportunities opened up by liberalization,
either trade or financial liberalization, and have been harmed in many cases by its direct and
indirect consequences. They had to depend on the mediation of large-scale trade.
Accordingly, in many cases liberalization put the MEs at a relative disadvantage vis--vis the
LEs. MEs were also affected by competitive pressure from outsiders due to their high
technology and better quality. The incentives provided for export promotion have not worked
for MED. Financial liberalization also did very little to help MEs in Sri Lanka.
In the new Millennium
Since independence there has been no clear development strategy and industrial
policy. The policies have been changed from time to time with changes in political power.
When looking at the ME sector, the situation has been even worse. There has been no macrolevel policy for MED although there have been some incentives provided by different
programmes. However, recently there have been a large number of institutions directly
involved in MED in Sri Lanka. Having recognized the policy requirements to MED, the
ministry of Industrial Development appointed a Task Force in October 2001 to inquire into
the needs, problems and future requirements of SMEs and to develop a national strategy for
Sri Lanka. The Task Force made a white paper on National Strategy for Small and Medium
Enterprise Sector Development in Sri Lanka in 2002. The white paper addressed the concerns
787
788
2007 which is providing one stop services to MEs. Moreover, BSCIC has been working for
MED since 1957 with some others.
Identification of MEs
Pakistan established a voluntary mechanism of certification where SMEDA provides
certification to MEs that enables it to get all the facilities and benefits extended to MEs. In
Bangladesh, the IP identified MEs under sectoral approach that may mislead, because the
major criteria of MEs are size and investment.
Dedicated Financing Window
India has well-developed mechanism for ME financing under the guidance of Reserve
Bank of India. There are six categories of ME financing institutions at national level, of
which Small Industries Development Bank of India is the refinancing window of the RBI. At
state level, there are four categories and at district level, six types of FIs are working for
providing financial support to the MEs. In Pakistan ME financing is incorporated to cater for
underserved segment of MEs. Sri Lankan government has established SME Bank and Lanka
Puthra Bank for resolving problems of ME financing. In Bangladesh BASIC Bank is to
provide financial support to the MEs. However, the portfolio of the bank is limited and
branches are not available in major contours of ME concentration.
Encouragement of Venture Capital
In Pakistan, improvement took place in the regulatory procedures and fiscal incentives
for Venture Capital companies. Sri Lanka is encouraging venture capital companies through
legislative protection of risk takers. In Bangladesh, venture capital funds are within the
purview of SME policy. Entrepreneurs Equity Fund is in operation for long time with mixed
outcome. A large portion of the fund has been misappropriated.
Bundle Approach for MEs
In India, Credit and advice are mutually inclusive factor in MED. For minimizing risk
of lending FIs can provide advisory services to the ME borrowers. BRAC Bank in
Bangladesh currently has been following this approach.
Enhancing Legislative Support to BDSPOs
In Sri Lanka legislative support is being provided to the BDSPOs to play an active
role in management and supervision of MEs, especially for reducing credit risks of ME
lending.
Management of Finances
In Sri Lankan ME policy documents feasible options on management of finances are
identified, which include training of ME owners in the elements of financial management and
789
Bangladesh, an ME web portal has been developed under the SMEF for the divining of
technology, products and market trends.
Enhancing Marketing Skills
India has established Export Promotion Council for the products with high potential
of exports that provides information and advice to the exporters. Their services also include
providing assistance about market, technology and procedures for exports, procuring orders
from buyers and pass them on to the prospective suppliers etc. Bangladesh Export Promotion
Bureau is working in this direction. Pakistan encourages establishment of ME specific export
marketing companies by providing grants for conducting marketing research, developing
marketing strategies, branding, participating and conducting trade fairs, and different other
marketing activities. In Sri Lanka, considering comparative disadvantages in access to market
information and existing information technology facilities creation of SME website was
considered a timely and an appropriate action for MED. The purpose is to provide e-business
facilities through an e-commerce portal at district level. The potential benefits would include
dissemination of trade information into remote areas, reducing the costs of' doing business,
and improving linkages with the global economy.
District Industries Centre
In the year 1978 the central government of India launched a programme of
establishing District Industries Centres to provide all the support services under a single roof,
such as clearances, licenses, and certificates required by the small entrepreneurs. There is
more than 400 such centres one each in a district.
Feeder to LEs
In India MEs play a feeder role to many LEs, both export oriented and target domestic
industries. Such relationship of MEs with LEs give them stability and sustainability. ME
promoting institutions play a role of broker for MEs to identify suppliers and buyers.
Public Procurement for Promotion of MEs
In Pakistan, all public sector procurement encourages participation of MEs with
certain products /contracts exclusively to be competed amongst the MEs. In Sri Lanka,
existing tender procedures and guidelines provide incentives for local value added industry as
against suppliers of imported products.
Entrepreneurship Skills, Retraining and Management
Pakistan conducts Need Assessment Survey to identify major ME needs in HRD,
technology up gradation and marketing. Institute of Small and Medium Enterprise and
Entrepreneurship Development is established in selected business schools. Selected sector
791
specific technical training institutes are initiating capacity building and up gradation
programmes such as curriculum redesign, provision of equipment, teachers training, and ME
liaison. Pakistan revised primary and higher education curricula for promoting
entrepreneurship amongst the educated youth and included entrepreneurship courses in higher
education, technical and vocational training institutions. Entrepreneurship competitions at
university level are being organized to culminate in annual entrepreneurship competition at
national level for selecting best business plans and providing grants for project
implementation. In Sri Lanka, a number of strategic initiatives recommended by the national
employment policy strategies to promote tertiary and vocational training.
Cleaner Production and Environmental Issues
Sri Lanka has initiated certain activities as a part of its recent efforts to integrate
cleaner production practices to industrial development. The establishment of' the National
Cleaner Production Centre at the federation of Chambers of' Commerce and Industry with
donor funding is a major achievement as well.
Indicators for Monitoring and Evaluation of MEDPS
SME Policy of Pakistan set specific indicators for monitoring progress of SME policy
implementation. These are: number of MEs; gender of owners; major sectors of enterprise
activity; levels of satisfaction recorded; feedback received; total cost of service; total benefit
of service in terms of employment, growth and income per beneficiary enterprise.
Recommendations for the further Development of MEDPs in Bangladesh
From the above discussion and analyses this paper recommends the following for the
further development of MEPDs in Bangladesh. The recommendations are summarised below under
three specific sub areas: the nature of MEDPs, role of government and practical aspects of MEDPs.
of MEs
Definitions
of
Non-manufacturing
Tiny
Enterprise
Cottage
Enterprise
equivalents.
793
Enterprise
equivalents.
Enterprise
time equivalents.
Enterprise
Indigenous technology user small factories should also be targeted such as, wooden
furniture, handicrafts made of cane, jute, or bamboo, and paper made dry flower, handmade or less
mechanized shoe and leather goods, packaging and printing, consumer goods production, plastic
goods, sanitary items, home based food products and utilities, confectionary, and electrical goods as
they can create employment opportunities with small amount of capital and in small places.
Moreover, innovative MEs, such as biogas, solar energy, and low cost housing, should be encouraged
in the MEDPs with special incentives.
DCs have a large domestic market, which should be targeted first for the ME products. They
might have a good prospect in the foreign market. DCs need to identify which ME products have the
potentials to be exported. Obviously, it depends on the nature of the products manufactured by the
MEs.
sufficient funds. The existing institutional structure should be reformed to focus on the
dynamism of the ME sector and cope with the latest technological development.
Collaboration can be made with successful countries in fostering technology development for
MEs. Technical services should be provided at the district level include quality control,
common facilities for instrumentation, testing and calibration. The idea of deploying
industrial extension officers in different parts of the country is an excellent practice in Sri
Lanka. For deployment of extension officers, a training facility can also be established.
Digital content can be made for this purpose and distributed to the information centres across
the country. This requires capacity building of R&D institutions. Professional bodies such as
Chamber of Commerce and industries should be encouraged to actively participate in
providing these common facilities.
Formulation of Unsuccessful ME Rehabilitation Act
Unemployment situation is going worst in the DCs. If one ME closes down at least four to
five people have become unemployed. Therefore, government must take appropriate measures to
help surviving the MEs. A yearly basis extensive survey might be done to find out the root causes of
the unsuccessfulness of the MEs, so that before dyeing they can be rehabilitated. Moreover, MEDPs
need to be implemented properly in the right time. They need time to time update on the basis of
the sector wise needs and needs of the market and an unsuccessful enterprise rehabilitation act can
be enacted to support unsuccessful MEs. It might help surviving the MEs.
B. Role of Government
Role of government in MEPD is very important, as they are the regulator, economic agent,
and strategic planner and promoter. For a steady growth and development of MEs every country
must have a strong political commitment. Because, in absence of which corruption and bribery
increases into an intolerable level. This increases the costs of production of MEs. Therefore,
government must ensure political stability, and an improved law and order situation for any kind of
expected development and this is government who can ensure it.
Appropriate Government Intervention
To ensure MED, government must play her role in a very positive way to formulate an
appropriate MEDP which may include the following specific areas: developing an enterprise culture
towards entrepreneurship; correcting market failure in accessing finance by loan guarantee scheme,
grants to MEs, and/ or equity finance; advice and assistance to new and existing MEs, ranging from
subsidized advice to individuals prior to starting or currently operating a new or existing MEs, and to
subsidized visit to overseas trade fairs; supporting technology and innovation and facilitate business
795
incubators that facilitates all the services and facilities to business to develop, and provide R&D
funding on innovation and technology; and supporting entrepreneurial development of particular
groups such as ethnic minority groups, women, youth, and the unemployed people.
partnership with private sector, for supporting individuals and collective initiatives i.e.
public-private partnerships, with a special focus on MED.
C. Practical Aspects of MEDPs
In the MEDPs of Bangladesh one stop shop for MEs are left with weak institutional
support. Currently SMEF is providing these services to MEs, but it is not adequate for the
countrywide MEs. A dedicated one-stop service system can be developed throughout the
country, to foster MED, which would be helpful to bring the MEs, particularly micro, cottage
and tiny enterprises to contribute to the national economy. Such system should be spread out
across the country. Moreover, SMEF is not enough to foster MED. The name SMEF may be
less convincing to the stakeholders. A MED Authority could be formed with exclusive
authority, power and fund to facilitate ME sector and coordinated efforts of other relevant
agencies including SMEF.
Institutional Support and Involvement of Local Government
To make the ME support services available to all the existing and possible entrepreneurs in
the country, district ME centres can be established. The example of India can be followed in this
regard. It will facilitate all the services from licensing to BDS for MED. Moreover, local government
bodies can play a key role in promoting MEs. There are limitations to central governments role in
supporting MEs and developing entrepreneurship. The basic elements of entrepreneurship cannot
be supplied by central government, and a bottom up development philosophy in favour of MEs can
only function with substantial local government, as local and regional authorities are closer to their
business communities. Government must take initiatives to involve the local government bodies to
promote MED activities. In fact, local government bodies in Bangladesh are very strong and elected.
They must be involved with special programmes to MED. Moreover, ME counselling and information
centre at the Upazilla (Sub-district) level under the supervision of the proposed District ME Centre
can also be established to attract and help the rural entrepreneurs.
Concluding Remarks
A well built and animated ME sector can provide a strong foundation to create
employment opportunities which can lead to the regional as well as sustainable ED. To
ensure socio-economic justice in terms of providing all the basic human rights through the
creation of employment opportunities for the vulnerable people by establishing MEs in DCs
an appropriate MEDP is must. This paper recommends on creating MEs by formulating a
coherent MEDP. Because, despite the internationally recognized importance, MEs still face
various challenges and problems in the DCs which can only be resolved by formulating a
797
coherent MEDP. It can be summarized that the existing MEDPs failed pragmatically to
achieve the goals of MED in Bangladesh. Bangladesh lacks an appropriate entrepreneurial
climate to foster MED and government is yet to recognize MED as the main strategy to
national ED. As a result, expected development of this sector is not cropping up. As a
facilitator and an economic agent, government must provide and ensure all the above
facilitates to MEs for sustainable ED. Consequently, there is an urgent need for ME policy
development to advance the situation. The study hopes that the above recommendations will
help the policy makers and the other stakeholders to advance and progress the situation of the
sector in an expected way, in the DCs, particularly Bangladesh.
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Mahajan, S. (2007), Bangladesh: Strategy for Sustained Growth, Poverty Reduction and
Economic Management Network: World Bank
798
799
crisis, FDI has come to be viewed as an increasingly important source of external finance for
developing countries. FDI also raises the technological standards and levels of efficiency and
competitiveness of the host country. FDI brings with it complementary assets such as
technology, management, and organizational competence and there are spillover effects of
these assets on the economy. Foreign owned company comes into competition with the local
forms, the latter category of enterprises are forced to improve their technology and standards
of product quality. Moreover, a foreign owned enterprise pressurizes and assists the local
related and support industries to improve the quality of their products and ensure greater
reliability of delivery. Another benefit of FDI is that it helps the host country improve its
export performance. By raising the level of efficiency and the standards of product quality,
FDI makes a positive impact on the host countrys export competitiveness. Because of
international linkages of MNCs, FDI provides to the host country better access to foreign
markets. Foreign Direct Investment brings in investable resources to host countries,
introduces modern technologies and provides access to export markets. The transnational
companies are the driving force behind foreign direct investment. They have large internal
markets, access to which is available only to affiliates. They also control large markets in
unrelated parties having established brand names and distribution channels spread over
several national locations. They can influence granting of trade privileges in their home
markets. Thus, they enjoy considerable advantages in creating an initial export base for new
entrants.
FDI is considered to be the life blood and an important vehicle of for economic
development as far as the developing nations are concerned. The important effect of FDI is its
contribution to the growth of the economy. FDI has an important impact on countrys trade
balance, increasing labour standards and skills, transfer of technology and innovative ideas,
skills and the general business climate. FDI also provides opportunity for technological
transfer and up gradation, access to global managerial skills and practices, optimal utilization
of human capabilities and natural resources, making industry internationally competitive,
opening up export markets, access to international quality goods and services and augmenting
employment opportunities.
Policy Perspective:
United Arab Emirates is one of the members of Gulf Cooperation Council Countries
and one of the members of OPEC. The UAE is composed of seven emirates viz., Abu Dhabi,
Dubai, Sharjah, Azman, Umm AL Quwain, Fujairah and Ras AL Khaimath. According to
801
World Economic Forum Global Competitive-2008-09 Report, UAE ranked 31st among 134
countries in terms of national competitiveness. UAE is the 5th largest oil producing nation
however; its dependency on oil has decreased to less than 40 per cent (UAE Interact, 2008). It
has the largest invested sovereign wealth funds according to IMF (de Ramos, 2008; IMF,
2008). Its diversified global strategies and huge investments in unique infrastructure projects
have made UAE a hub in this region not only for trade and logistics, but also tourism
(Balakrishnan, 2008). Inspite of world recession, the UAEs economy is still forecast to grow
by 2.7 per cent in 2009 according to Standard Charter (Bundhun, 2009). Though, the global
GDP is expected to grow by only 0.5 per cent according to IMF (2009).
According to WTOs 2012 and 2006 Trade Policy Reviews of the UAE, the UAEs
investment policy limits foreign investment, except in the free zones where 100 per cent
foreign ownership is allowed, and thus, reduces competition between local and foreign
investors in the economy. The Federal Commercial Companys Law stipulates that UAE
nationals must hold at least 51 per cent of the capital of the any company established in the
UAE. However, there are exceptions to this provision for (1) Other GCC countries nationals,
who are granted national treatment and may have upto 100 per cent ownership in most
activities, and for (2) companies registered as branches or representatives offices of foreign
companies established in Dubai (Mina, 2012). UAE government has established nearly 40
free zones, in which 100 per cent foreign ownership is allowed and no taxes are levied. The
highest concentration of free zones is found in Dubai, with more than half of the total number
of free zones, followed by Abu Dhabi, Ras AL Khaimath and Fujeirah. Outside the free
zones, local sponsorers are needed for foreign companies to be established, and foreign
ownership is limited to a maximum of 49 per cent. According to a report by United State
Government Accountability Office, in addition to the Federal Commercial Companys Law,
the Commercial Agencies Law, 2006 on Deregistration of Trade Agencies, represents another
legal barrier to FDI in the UAE, as it stipulates that the operations of foreign importers need
to be done through a sole UAE agent, either a national or a fully national owned company,
and the terms of the agency relationship. However, changes were introduced in 2009 with
modifications to make contracts more easily enforceable. Government of UAE has mandated
to implement a National Investment Reform Process that improves the countrys investment
policy. The policy offers foreign investors similar rights to those extended to UAE nationals.
Investment freedom in the UAE is by far the lowest scored among the ten economic freedoms
included Heritage Foundations Index of Economic Freedom. Although, the UAEs 2012,
802
overall economic freedom score was 69.3, positioning it in the 35th rank among the worlds
countries in terms of overall economic freedom, its investment freedom score was only 35,
positioning it in the 123rd rank. Despite some legal barriers to foreign investment in UAE,
rapid growth of inward FDI during most of the period since 2000 reflects an overall
confidence of investors in the economy, its business environment and growing
competitiveness both regionally and globally. UAE has also made easy access to credit to the
entrepreneurs through establishing a Federal Credit Bureau at Dubai. Measures have also
been taken to make it easier to obtain construction permits. In view of strengthening the
protection of foreign investors property rights and encouraging foreign investments, the
UAE government has signed a total of 38 bilateral investment treaties as on June, 1, 2012.
The UAE has also signed 48 double taxation treaties with 46 countries. Thus, the UAE
government is making serious efforts to liberalize the investment policy for foreign investors.
Regional FDI Trends:
Global foreign direct inflows rose in 2011 by 16 per cent compared with 2010,
reflecting the higher profits of TNCs and the relatively high economic growth in developing
countries during the year. The global inward FDI stock rose by 3 per cent reaching $20.4
trillion (UNCTAD, 2012). West Asia witnessed a 16 per cent decline in FDI flows in 2011
despite the strong rise of FDI in Turkey. Some GCC countries are still recovering from the
suspension or cancellation of large scale projects in previous years. Inflows to West Asia
declined for a third year. They decreased by 16 per cent to $49 billion in 2011, affected by
both the continuing political instability and the deterioration of global economic prospects in
the second half of 2011.
The level is the lowest since 2005 when FDI flows stood at about $44 billion and for
below the record high of about $92 billion registered in 2008. Saudi Arabia the regions
biggest recipients witnessed a 42 per cent fall in 2011 to $16 billion, which largely explains
the overall decline. As of October, 2011, the cancelled or suspended construction projects in
the Middle East and North African market were estimated at $1.74 trillion, with $958 billion
in the UAE alone and $354 billion in Saudi Arabia. Construction was one of the most
important areas of investment to have emerged in the last oil boom, and the pace of its
activity is among the key indicators of investment behavior in housing, tourism,
infrastructure, refineries, petrochemicals and real estate. Political and social unrest has halted
FDI to non-GCC Arab countries. Flows to this group of countries which represented 14 per
cent of the regions total, declined by 26 per cent in 2011 to $7 billion.
803
2006
2007
2008
2009
2010
2011
West Asia
67121
78112
91985
66276
58193
48682
Bahrain
2915
1756
1794
257
156
781
Iraq
383
972
1856
1598
1396
1617
Jordan
3544
2622
2826
2413
1651
1469
Kuwait
121
112
-6
1114
319
399
Lebanon
3132
3376
4333
4804
4280
3200
Oman
1597
3332
2952
1508
1142
788
Palestinian Territory
19
28
52
301
180
214
804
Qatar
3500
4700
3779
8125
4670
-87
Saudi Arabia
17140
22821
38151
32100
28105
16400
659
1242
1467
1514
1850
1059
Turkey
20185
22047
19504
8411
9038
15876
UAE
12806
14187
13724
4003
5500
7629
Yemen
1121
917
1555
129
-93
-73
There has been fluctuating trend in inward FDI flows in UAE over the period of
2000-2011. The highest amount of FDI in UAE was reported in the year 2007 in which UAE
attracted $14.2 billion however, the amount decline to $7.7 billion in 2011. Inward FDI
constituted 6.8 per cent in 2004 and as low as 2.1 per cent in 2011 in UAE (Table 2).
Table: 2
2011
2010
2008
2009
2007
2004
2003
2002
2001
2006
-0.5
2005
UAE
2000
Econom
y
1.2
0.1
4.3
10
10.9
12.8
14.2
13.7
5.5
7.7
1.1
0.1
3.4
6.8
6.0
5.8
5.5
4.4
1.5
1.8
2.1
Percent of GDP
-0.5
Memorandum:
Comparato
r
economies
(US$ billion)
Saudi
Arabia
0.2
0.5
0.5
0.8
1.9
12.1
17.1
22.8
38.2
32.1
28.1
16.4
Qatar
0.3
0.3
0.6
0.6
1.2
2.5
3.5
4.7
3.8
8.1
-0.1
Oman
0.1
0.1
0.1
1.5
1.6
3.4
2.5
1.5
0.8
Bahrain
0.4
0.1
0.2
0.5
0.9
2.9
1.8
1.8
0.3
0.2
0.8
805
Kuwait
-0.2
-0.1
0.2
0.1
0.1
1.1
0.3
0.4
Country-wise FDI inward stock in West Asia is shown in Table 3. The amount of FDI
inward stock in UAE was reported $751 million in 1990 which increased to manifold in
2011. The share of FDI inward stock of UAE constituted 2.40 per cent in 1990 which
increased significantly to 14.84 per cent in 2011. The other important countries in West Asia
in terms of FDI inward stock were reported to be Saudi Arabia and Turkey.
Table: 3
Country-wise FDI Inward Stock in West Asia
(In million US Dollar)
Country
1990
2000
2011
West Asia
31194
59688
575412
Bahrain
552
5906
15935
Iraq
--
--
9601
Jordan
1368
3135
23368
Kuwait
37
608
10765
Lebanon
53
4988
40645
Oman
1723
2577
15005
Palestinian Territory
--
647
2389
Qatar
63
1912
30477
Saudi Arabia
15193
17577
186850
154
1244
10323
Turkey
1150
19209
140305
UAE
751
1069
85406
Yemen
180
843
4344
806
There has been increasing trend of inward FDI stock in UAE during the period of
2000-2011. Similarly, the composition of inward FDI stock in terms of GDP has also shown
an increasing trend in the corresponding period except in the year 2009 and 2010. The inward
FDI stock constituted only 1 per cent of GDP in 2000 while it was reported 26.7 per cent in
2009 which slightly decline to 23.7 per cent in 2011 (Table 4).
Table: 4
UAE
1.1
2011
2010
2009
2008
2007
2006
2005
2004
2003
2002
2001
2000
Econom
y
2.3
2.3
6.6
16.
6
27.
5
40.
3
54.
5
2.2
2.1
5.3
11.
2
15.
2
18.
2
21.
1
Percent of GDP
1.0
Memorandum:
Comparat
or
economies
(US$ billion)
Saudi
Arabia
17.
6
17.
3
17.
7
18.
5
20.
5
33.
5
50.
7
73.
5
Qatar
1.9
2.2
2.8
3.5
4.7
7.2
10.
7
15.
4
Oman
2.6
2.6
1.9
2.4
2.5
4.1
5.7
9.2
Bahrain
5.9
6.2
6.7
7.4
8.3
11.
2
12.
9
14.7 15
Kuwait
0.6
0.4
0.4
0.4
0.4
0.6
0.8
0.9
0.9
807
15.2 15.9
Comparison of FDI inflows and outflows from India and China is shown in Table 5.
There has been fluctuating trend in FDI inflows and outflows in India however in China,
there has been increasing trend in inward and outward FDI inflows. The ratio of FDI outward
to inward has shown an increasing trend both in India and China during the period of 1990 to
2010.
Table: 5
Comparison of Foreign Direct Investment Inflows and Outflows from India and China
(US$ millions)
Inward
Outward
Inward
Outward
Indias
Chinas
outward
to outward to
inward ratio
inward ratio
1990
236.69
3487.11
830
0.025
0.238
1991
75
-11
4366.34
913
-0.147
0.209
1992
252
24
11007.51
4000
0.095
0.363
1993
532
0.350641
27514.95
4400
0.0006
0.160
1994
974
82
33766.5
2000
0.084
0.059
1995
2151
119
37520.53
2000
0.055
0.053
1996
2525
240
41725.52
2114
0.095
0.051
1997
3619
113
45257.04
2562.49
0.031
0.057
1998
2633
47
45462.75
2633.807
0.018
0.058
1999
2168
80
40318.71
1774.313
0.037
0.044
2000
3587.99
514.4454
40714.81
915.777
0.143
0.022
2001
5477.638
1397.437
46877.59
6885.398
0.255
0.147
2002
5629.671
1678.039
52742.86
2518.407
0.298
0.048
2003
4321.076
1875.78
53504.7
2854.65
0.434
0.053
2004
5777.807
2175.367
60630
5497.99
0.376
0.091
2005
7621.769
2985.488
72406
12261.17
0.392
0.169
2006
20327.76
14284.99
72715
21160
0.703
0.291
2007
25349.89
17233.52
83521
22468.86
0.680
0.269
Year
India
China
808
2008
42545.72
19397.45
108312
52150
0.456
0.481
2009
35648.78
15929.25
95000
56530
0.447
0.595
2010
24639.92
14626.1
105735
68000
0.594
0.643
Top 15 destinations of outward FDI from India and China during 2009 are shown in
Table 6. Singapore, Netherlands, USA, Mauritius, UK, Channel Islands, Cyprus and Russian
countries are the major destinations of outward FDI from India. During the year 2009, Indias
outward FDI to UAE amounted $2232.40 million. Major destinations of Chinas outward FDI
including Hongkong, British Virgin Islands, Cayman Islands, Australia, Singapore, USA and
Luxembourg.
Table: 6
Top 15 Destinations of Outward Foreign Direct Investment from India and China in
2009
(Stock in Million US$)
India
China
Rank Destination
Amount
Rank
Destination
Amount
Singapore
14384.11
Hongkong
164498.94
Netherlands
10714.03
British
Islands
USA
6616.85
Cayman Islands
13577.07
Mauritius
6165.38
Australia
5863.10
UK
5624.11
Singapore
4857.32
Channel Islands
5446.02
USA
3338.42
Cyprus
4679.12
South Africa
2306.86
Russia
3105.65
Luxembuorg
2484.38
809
Virgin 15060.69
UAE
10
2232.40
Russia
2220.37
10
Macau
1837.23
11
Sudan
1191.13
11
Canada
1670.34
12
Switzerland
1069.77
12
Kazakhstan
1516.21
13
Hong Kong
998.58
13
Pakistan
1458.09
14
China
949.42
14
Mongolia
1241.66
15
Egypt
820.71
15
South Korea
1217.80
Year-wise Indias actual outflows in respect of outward FDI are shown in Table 7.
Equity constituted 71.83 per cent while the amount of loan accounted for 28.09 per cent. The
share of guarantee accounted for only 0.08 per cent in actual outflows in respect of outward
FDI from India during the period of 2000-2001 to 2011-12.
Table: 7
Yearwise Indias Actual Outflows in Respect of Outward FDI and Guarantees Issued
(In million US Dollar)
Period
Equity
Loan
Guarantee
Invoked
Total
Guarantee
Issued
2000-2001
602.12
70.58
4.97
677.67
112.55
2001-2002
878.83
120.82
0.42
1,000.07
155.86
2002-2003
1,746.28
102.10
0.00
1,848.38
139.63
2003-2004
1,250.01
316.57
0.00
1,566.58
440.53
2004-2005
1,481.97
513.19
0.00
1,995.16
315.96
2005-2006
6,657.82
1,195.33
3.34
7,856.49
546.78
2006-2007
12,062.92
1,246.98
0.00
13,309.90
2,260.96
2007-2008
15,431.51
3,074.97
0.00
18,506.48
6,553.47
2008-2009
12,477.14
6,101.56
0.00
18,578.70
3,322.45
2009-2010
9,392.98
4,296.91
24.18
13,714.07
7,603.04
2010-2011
9,234.58
7,556.30
52.49
16,843.37
27,059.02
810
2011-12*
4,031.45
4,830.01
0.00
8,861.46
14,993.80
Total
75,247.61
29,425.32
85.40
10,4758.30
63,504.05
Overseas
Investments
by
Period
2008-09
2009-10
2010-11
201112*
Total
Manufacturing
10.18
5.35
5.04
2.74
23.31
4.41
6.53
2.53
17.03
1.13
1.89
1.00
5.19
Trade, 1.17
2.38
0.95
1.21
0.41
4.94
Transport, Communication
Storage Services
& 0.31
0.38
0.82
1.34
2.85
0.35
0.36
0.38
0.37
1.46
0.18
0.70
0.18
1.45
0.14
0.84
0.10
0.04
1.19
Miscellaneous
0.12
0.11
0.18
0.10
0.51
Total
18.58
13.71
16.84
8.73
57.86
Construction
cent in 2010-11, however, it slightly decline to 4.29 per cent in 2011-12. The amount of
overseas investments by Indian companies in UAE was reported $2.51 billion in the
corresponding period.
Table: 9
Top
Ten
Indian Companies
Country-wise
Overseas
Investments
by
2008-09
2009-10
2010-11
2011-12*
Total
Singapore
4.06
4.20
3.99
1.86
14.11
Mauritius
2.08
2.15
5.08
2.27
11.57
Netherlands
2.79
1.53
1.52
0.70
6.54
1.02
0.87
1.21
0.87
3.97
0.63
0.64
0.86
0.38
2.51
0.00
0.75
0.28
0.52
1.55
United Kingdom
0.35
0.34
0.40
0.44
1.53
Cayman Islands
0.00
0.04
0.44
0.14
0.62
Hong Kong
0.00
0.00
0.16
0.31
0.46
Switzerland
0.00
0.00
0.25
0.16
0.41
Other countries
7.65
3.19
2.65
1.23
14.71
Total
18.58
13.71
16.84
8.86
812
Years
UAE
West Asia
2005
12
57
2006
13
86
2007
18
116
2008
27
138
2009
13
77
2010
20
106
2011
31
122
2005
22
66
2006
42
91
2007
56
129
2008
68
166
2009
36
73
2010
18
64
2011
31
84
Sales (Net)
Purchases (Net)
UAE
West Asia
29
1613
2007
856
22602
2008
1226
16287
Sales (Net)
813
2009
300
3543
2010
756
4887
2011
554
9713
791
2164
2007
15611
40103
2008
5983
22099
2009
14831
26843
2010
-1803
-15278
2011
5741
6136
Purchases (Net)
million in UAE. The share of UAE in number of green field projects as against of green field
projects in West Asia as a whole accounted for 47.95 per cent in 2011. However, the worth of
green field projects in UAE was recorded highest in 2008 with the share of more than 60 per
cent as against West Asia as a whole.
Table: 12
Green Field FDI Projects
Years
UAE
West Asia
2005
102
240
2006
215
440
2007
154
317
2008
269
594
2009
232
445
2010
214
453
2011
257
536
2005
29400
58907
2006
83905
139725
2007
60387
81755
2008
114705
190137
2009
34142
82733
2010
23958
37190
2011
14991
44194
Number of Projects
advanced countries since 2007. The hope for global economy lies in the growth process of
the emerging developing economies of the world. The economies of China and India not only
shown resilience in a recession ridden global economy but has emerged as the growth pole of
the global economy. The global economy has witnessed a dramatic change in the structure
and pattern of international investment associated with the arrival of new international firms
from the emerging economies. Indian and Chinese firms have long experience to operate and
invest in other countries of the globe. The overseas investment experience of both Indian and
Chinese firms show that largely they operated in the developing countries possesses
technological and other capabilities equal or lower than at home. However, some investment
has been made in the industrially advanced countries though in minority equity participation.
The UAE has envisaged a strategic policy to build sustainable and diversified economy. In
view of the growing importance of FDI for economic development, UAE has introduced
policy reforms and initiated an investment policy for encouraging foreign investors.
However, the recent crisis of economic and political instability in Middle East and African
region has affected inward FDI flows to UAE. This is a serious concern for the policy
makers, serious efforts will be required to speed up the ratification of a new foreign
investment law, which removes several of the current legal barriers to FDI and offers foreign
investors similar rights to those of UAE nationals. There is also imperative need to monitor
the green field projects that they are completed in the scheduled time and there is no
cancellation or suspension of projects.
References:
Bala Krishnan, M.S. (2009), Approaches to Enter Emerging Markets: A UAE Case Study,
Research Online University of Wollongong, Dubai.
Bundhun, R. (2009), UAE Growth to Slow to 2.7 per cent in 2009, Standard Charter
Arabian Business.Com, dated 15th December, 2008.
de
on
Sovereign
Wealth
Funds,
Business
Week,
Fung, K.C. and Herrero, A.G. (2012), Foreign Direct Investment Outflows from China and
India, China Economic Policy Review, Vol. 1, No. 1.
Government of China (2011), Statistical Bulletin of Chinese Outward Foreign Direct
Investment, 2010, Ministry of Commerce, Government of China.
Government of India (2012), Country-wise Approvals of Indian Direct Investment in Joint
Ventures and Wholly Own Subsidiaries, Ministry of Finance, Government of India,
New Delhi.
IMF (2008), Sovereign Wealth Funds: A Work Agenda, dated Feb., 29, 2008, www.imf.org.
IMF (2009), World Economic Outlook Update dated Jan. 28, 2009, www.imf.org.
816
Mina, Wasseem (2012), Inward FDI in the United Arab Emirates and Its Policy Context,
Vale Columbia Centre on Sustainable International Investment.
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UNCTAD (2011), World Investment Report, Geneva, 2011.
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Intelligence, UNCTAD, Geneva, 2012.
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817
DR. R S RAMESH,
HEAD & HOD JSSATE &
PROF. VS CHAUHAN,
ACHARYA BANGALORE B SCHOOL.
Abstract
With about 6 lakhs villages and around 60 -65 % of the rural population, India rural market
offers high potential. Fast Moving Consumer Goods (FMCG )is a major product category in
rural consumption. Firms marketing FMCG to rural market cannot just extend their general
marketing strategies to rural markets. Rather, they are required to formulate rural specific
marketing strategies. These firms need to understand important issues relating to consumer
behavior in rural market and specifically in the context of different geographic regions. This
study aims to understand factors influencing the rural purchase of FMCG in South India. The
study examines 8 districts of South India to pin point the key influencing parameters. Factor
analysis was considered to form 24 key variables into five groups of influencing factors. One
of the most significant variables was the trust factor. Retailers recommendations have
emerged as the most significant variable. The study indicate that the south Indian rural
consumers consider usage of FMCGs contribute to lifestyle.
Keywords: product category, rural life style, consumer Trust factor, Brand visibility, Value
proposition.
Brief Introduction :
Since 1950, thrust to rural developments has eventually made Indian rural market a highly
potential market. Awareness enhancement with increase in income levels has influenced the
rural marketing environment. (Velayudhan, 2002). Primarily, factors contributed to the
growth of Indian rural markets are
media penetration
Fast Moving Consumer Goods (FMCG) market has appeared as one of the most attractive
rural markets in India (Kashyap, Pradeep & Raut, Siddharth, 2007). Effective FMCG
marketing strategy in a rural context includes
one of the popular myth about the rural markets is that it offers potential only for agri-inputs
(Khosla, Ashok, 2000). The rural FMCG market in country has grown 15% in 2011 (Nielsen
Report, 2012). The Indian rural consumer market grew 25% in 2008 and would reach US$
425 billion in2010-11 with 720-790 million customers (Quarterly Report, CII-Technopak,
2009).
819
Rural Buyer
Rural Seller
Urban Seller
I: RS-RB
II: US-RB
II: US-RB
inputs, farm
implements & machinery
Urban Buyer
III: RS-UB
IV: US-UB
Vaswani et al. (2005) gave the Rural buyer-Seller (Producer) Matrix that presents the scope
of rural marketing (Figure 1.1). On Shelf-I are the goods which are made by rural people in
rural areas and consumed by rural inhabitants. Examples include pottery, woolen, cotton and
silk fabric weaved by handlooms, vegetables and fruits, etc. Shelf-II comprises of goods
made and sold by urban people to rural areas like, automobiles, bicycles, farm equipment,
fertilizers, etc. Shelf-III comprises of goods made in rural areas and consumed in urban areas
like, vegetables, agro-based products, products of cottage industries, etc. Shelf-IV does not
fall under the scope of rural marketing.
Acceptability
Awareness
Rural
Marketing
Acceptability
Availability
cceptability
820
Affordability
Acceptability,
Affordability,
Accessibility and
Awareness
Review of Literature
With market liberalization policies after 1990s, marketing scenario in India changed
totally(Gopala Swamy, 1997). Primarily, the Indian rural markets are untaped in nature and
now they are opening for most of the packaged goods (Habeeb-Ur-Rahman, 2007) and for
other many of the product categories (Bijapurkar, Rama 2000). It necessary for Rural
marketers to differentiate themselves on quality and value for money (Anand & Krishna,
2008). For this, they have to understand the factors influencing the rural buying of FMCG
(Krishnamoorthy, 2008). Various factors influence the buyers decisions making (Blackwell
and Talarzy, 1977). Many literature indicated that
Quality (Rashmi & Venu Gopal, 2000; Kumar & Madhavi, 2006),
Opinion leaders have a great influence on the rural consumption behavior (Sayulu & Ramana
Reddy, 1996). Study shows that the retailers are key influencers of rural purchase of FMCG
(Ying Zhao, 1994).
821
Research Gap
Though the available literature on influencing factors looks adequate, there is still needs for
further research in different geographic rural markets (Jha, Mithileswar, 2003; Bijoor, Harish
2004). Rural consumer behavior differs for different product categories and geographic
markets (Sinha, 2008). As per Rajan, R.V., a lot of study still required to understand rural
buyers. Though studies are conducted on various aspects like, challenges in rural markets
(Khatri, 2002), advertising issues in rural marketing (Balakrishnan, 2007), importance of
creativity in message generation and message execution while communicating with rural
markets (Bansal & Easwaran, 2004) and general issues relating to rural markets (Bijapurkar,
Rama, 2000),there is still a remarkable scope for examining more issues related to buyer
behavior in the context of rural markets. The literature review reveals that very little research
is done on rural consumer behavior with respect to factors influencing the purchase and
consumption of FMCG, specifically for the South Indian rural consumers. Hence, this
researches study on FMCG buying behavior of rural consumers in India.
Primary Objective of the Study
Primary focus of the study is to find out the critical factors that influence buying behavior for
FMCG by rural population of South India.
Research Methodology
1. Primary data :
It is gathered through administering a structured questionnaire using 5 point scale to apply
suitable statistical technique.
1
Friends Recommendation
Low price
Affordability
LONG lasting
822
Need based
13
Packaging
Brand awareness
14
Relationship marketing
15
Brand endorsements
10
Promotions
16
Quality
11
Dignity
17
Govt. Promotions
12
Availability
18
Lifestyle
19
Brand loyalty
20
Size
21
Shelf display
22
Intended benefits
23
24
Brand equity
Factor
Variables
Factor Loadings
Promotions
0.951
Relationship marketing
0.912
PROMOTION
Product education
0.903
FACTOR
0.896
Brand endorsement
0.871
Shelf display
0.810
Brand awareness
0.847
Packaging
0.847
LIFESTYLE
Dignity
0.816
FACTOR
Brand visibility
0.799
823
Lifestyle
0.750
Friends recommendation
0.883
Brand loyalty
0.791
TRUST
Government promotions
0.790
FACTOR
0.784
Availability
0.746
Intended benefits
0.880
VALUE
Affordability
0.862
FACTOR
Need based
0.827
Low price
0.760
More features
0.780
PRODUCT
Size
0.726
FACTOR
Quality
0.713
long lasting
0.624
Sample unit for the current research consisted of rural population living in villages who are
both buyers and consumers of FMCG.
Statistical Tools for data analysis: Factor Analysis was conducted to identify the factors
that influence the FMCG purchase decision of rural consumers.
2. Secondary data:
Data Analysis :
Main objective of the research was to find out the factors influencing the buying decisions of
rural buyers w.er.to FMCG. Twenty four variables were identified that influence rural
824
buyers purchase decisions. of FMCG. Accordingly 5 factors were identified as given in the
Table 1.
Sales promotions can play an important role as the rural customers can get attracted
by various sales promotion techniques like, free offers.
Brand endorsements also emerges as critical variable. Rural marketers can use
celebrity endorsements as a part of their product promotions.
Shelf display contributes to a great extent in promotion of FMCG. It is also one of the
key variables contributing to the Promotion Factor.
The study reveals that the rural buyers relate their purchase and consumption of
FMCG to their improved lifestyles.
Brand awareness is the key factor. The buyers awareness for a given brand is very
important from the rural marketing point of view.
825
Packaging too influences rural customers buying decisions. In this study packaging
emerges as one of the vital variables that influences lifestyle of the rural consumers.
It is also found that the rural buyers buy FMCG to make them feel dignified while
buying/possessing/ using them. This feeling dignified adds to their lifestyle. Lifestyle
Factor covers Brand visibility.
Government plays one of the most trusted sources for rural target segment. They
trust and buy goods promoted by Government.
It has been found that firms that incorporate their products/brands in announced
government policies are more likely to influence the rural buying decisions.
The relationships among vendors / shop keepers and their identified customers are
relatively stronger in rural areas.
It is observed that the rural buyers look for the value in their procurements of FMCG.
Value products are those FMCG which are affordable, low priced and satisfy
intended benefits of the buyers. The rural consumers buy FMCG based on their
needs.
When it comes to product factor, influencing the rural purchase is influenced by four
important variables,
more features,
826
Reliability
Cronbachs
Alpha
No. of
variables
Overall reliability
0.821
24
Reliability of factor 1
0.953
Reliability of factor 2
0.886
Reliability of factor 3
0.859
Reliability of factor 4
0.860
Reliability of factor 5
0.711
Reliability analysis measures the internal consistency and reliability of the data collection
instrument. For each of the factors the Cronbachs Alpha is higher than 0.7 which indicates
the significance of the model. Details are given presented in above mention Table 2.
Rural buyers believe and trust retailers of their rural location. The rural retailers know that
their customers listen to them. The firms are suggested to educate rural sellers about the
marketing principles for their performance. Since price influences rural buying of FMCG, it
is suggested that the firm should formulate and pursue the low-price strategy. To adopt low
price strategy, firms are required to go for low-cost manufacturing and various marketing
activities that include promotion and distribution. For rural buyers, value for money results
when the purchased FMCG meets the intended benefits. Hence
promote goods on price plank. The study speaks clearly that the rural buyers look for quality
827
goods in addition to low price. ) Sound product performance, reliability, brand image and
other factors also play a very important role in buyers behavior. Hence it is suggested, that
instead of mere low pricing strategy, firms should rationalize their total market activities.
Innovative promotional strategies are the need of the hour in case of Rural marketing.
Hence firms are advised to design their marketing messages that are easy to understand and
are compatible with their educational back ground. Rural buyers associate long lasting
feature with larger size and/or hardness of the product. Hence, it is recommended that all
promotion activities for FMCG should revolve around this aspect. In the context of rural
buying decisions, quality and consumption of FMCG are also important. And therefore firms
should not compromise on the quality. Best option to firms is offer affordable prices with
optimal quality.
Generally rural buyers are attractive towards good looking package. It encourages positive
impression their minds which influence their purchase behavior. They remember product by
its packaging. Hence, it is suggested that firms should pay more attention towards designing
low cost attractive packaging.
It is also suggested that firms formulate their marketing strategies in line with rural
development programs of the government. Firms also should communicate related
government policy in their promotional strategy. The rural buyers strongly believe in
messages coming from Government.
Celebrity endorsements work wonder in rural marketing, and hence it is suggested that the
firms adopt low-cost advertisement strategies. The use of animated celebrity characters is one
of the alternatives.
maintaining quality,
828
For FMCG, future is very encouraging. Research can be undertaken to find out how firm can
encourage rural entrepreneurship.
References
5. Kothari, C.R. (2004), Research Methodology Methods and Techniques, 2e, New Age
International (P) Ltd., New Delhi, pp. 152-232
6. Mitra R. and Pingah, V. (2000), Consumer aspirations in marginalized communities: a case
study in Indian villages, Consumption Markets and Culture, Vol. 4 No. 2, pp. 125-144.
7. Pandey, D.P. (2005), Education in rural marketing. University News, vol. 43, pp. 78.
8. Ramanathan, V. (2007), Retailing channel enhancement strategies adopted by FMCG
companies in South Indian rural markets, The ICFAI Journal of Management Research,
Vol.6 No. 11, pp. 64-70.
9. Sahoo, S.K. and Panda, J.P. (1995), The rural market and rural marketing in India:
challenges and strategies, Indian Journal of Commerce, Vol.18, pp. 185.
829
10. Sehrawet, Mahavir and Kundu, Subhash C. (2007), Buying behaviour of rural and urban
consumers in India: the impact of packaging, International Journal of Consumer Studies,
Vol. 31 No. 6, pp. 630-638.
830
ANU.K.M
PHD RESEARCH SCHOLAR,
SCHOOL OF COMMERCE,
BHARATHIAR UNIVERSITY,
COIMBATORE-641046.
TAMIL NADU, INDIA.
Abstract
This paper examines the relationship between capital flows and the current account deficit in
seven emerging economies namely Brazil, Russia, India, China, Turkey, Indonesia and
Mexico over the period from 2005 to 2015. Augmented Dickey Fuller unit root test was used
to analyze the stability of Current deficit (CA) and Capital flows (CF) series. In this study
autoregressive distributed lag (ARDL) bound test was used to determine the co-integration
between the variables. To conclude there was co-integration relationship between the
variables for the economies Brazil, China, India and Turkey.
Keywords: emerging economies, current deficit, capital flows, ADF unit root, ARDL bound
test
JEL Classification code: O1, O160, H62
Introduction
The rise of global financial transactions and trade in the late-20th century drives
Balance of Payment (BOP) and macroeconomic liberalization in many developing nations.
With the advent of the emerging market, economic boom, in which capital flows into these
markets tripled from USD$50 million to $150 million from the late 1980s until the Asian
831
crisis. In order to take advantage of these capital inflows, developing countries were urged to
lift restrictions on capital and financial account transactions. The balance of payments (BOP)
is the method that a country uses to monitor all international monetary transactions at a
specific period of time. All trades conducted by both the private and public sectors are
accounted for in the BOP in order to determine how much money is going in and out of a
country. If a country has received money, this is known as a credit, and if a country has paid
or given money, the transaction is counted as a debit. Theoretically, the BOP should be zero,
meaning that assets (credits) and liabilities (debits) should balance, but in practice this is
rarely the case. Thus, the BOP can tell the observer if a country has deficit or surplus and
from which part of the economy discrepancies originates. The BOP is divided into three main
categories: the current account, the capital account and the financial account. The current
account is used to mark the inflow and outflow of goods and services into a country. Earnings
on investments, both public and private, are also included in the current account. The capital
account is where all international capital transfers are recorded. This refers to the acquisition
or disposal of non-financial assets (for example, a physical asset such as land) and nonproduced assets, which are needed for production but have not been produced, like a mine
used for the extraction of diamonds. In the financial account, international monetary flows
related to investment in business, real estate, bonds and stocks are documented.
Summary of Previous Research
Yusuf Ekrem akbas,Mehmet Senturk and Canan Sancar (2014),their paper analyzed the
relationship between current account deficit and capital flows in turkey over the period from
1990-2011.Auto regressive distributed lag(ARDL) bound test was used to check the cointegration between the series. The study revealed that there is a co-integration relationship
between current deficit and capital flows in Turkey.
Omkar K and Shweta Pilla (2013), examined the relationship between the Current account
deficit(CAD), the Foreign Investment and the Exchange Rate of the Indian Rupee. By
analyzing the data of these variables and their movements for the period from 1999 to 2012,
it has been found that there is theoretically interdependence between these three variables.
Further it was evidenced that the CAD is affected by negative movements of the exchange
rate and negative Foreign Investments.
Selen Sarisoy Guerin (2003), examined the relationship between net private capital inflows
and the current account in a set of industrial and developing countries. Panel data regression
and Granger causality test were used in the study. The result implies that inflows do not cause
832
current account imbalances in the industrial countries, nor does the inflow volatility affect
current account volatility.
Problem Focused in the Study
The current account balance is one of the most important indicators of
macroeconomic performance. Emerging economies namely Brazil, India, China, Russia,
Indonesia, Mexico and Turkey have been facing current deficit problems for many years.
These economies need a long period of time to have technology for imports and to create
alternative energy sources. So to finance current deficit, quick and cheap ways are chosen.
There are many ways to finance the current deficit in an economy such as official reserves,
loan, net errors and omissions and capital flows. Capital flows are the most convenient
solution among all the alternatives to finance the current deficit. Hence the present study
made an attempt to test if there is any relationship between current deficit and capital flows in
the emerging economies.
Empirical Methodology
Stationarity tests:
Unit root testing is an important and prerequisite for any time series analysis to check
whether the data is stationary or not. A series is said to be stationary if the mean and
covariance of the series do not depend in time. To test the presence of unit root, Augmented
Dickey Fuller (ADF)15 tests was employed in the study.
15
833
the reasons for preferring the ARDL is that it is applicable irrespective of whether the
underlying regressors are purely I(0), I(1), or mutually co-integrated. The statistic underlying
this procedure is the familiar Wald or F-statistics in a generalized Dickey-Fuller type
regression, which is used to test the significance of the lagged levels of the variables under
consideration in a conditional Unrestricted Equilibrium Error Correction Model (UECM)
(Pesaran et al., 2001). The model used for the testing the long-run relationship of the model is
given as:
CAt = 0
16
+ 1CAt-1 + 2CFt-1 +
= 3,j CAt-j += 4, j CFt-j + vt .......(1)
CFt = 0
After regression of Equation (3), the Wald test (F-statistic) was computed to
differentiate the long-run relationship between the concerned variables. The Wald test can be
carried out by imposing restrictions on the estimated long-run coefficients. The null and
alternative hypotheses are as follows:
H 0 = 1 = 2 = 3 = 0 (no long-run relationship)
Against the alternative hypothesis
H 0 1 2 3 0 (a long-run relationship exists)
The computed F-statistic value will be evaluated with the critical values. The lower
bound critical values assumed that the explanatory variables xt are integrated of order zero, or
I(0), while the upper bound critical values assumed that xt are integrated of order one, or I(1).
Testing for long and short-run coefficients .The ECM version of modified ARDL is
used to investigate the short run dynamic relationships. All this will be done through the
ECM (Error Correction Mechanism) applied through the Ordinary Least Square (OLS)
method. The model is as follows:
CAt = 0
18
+ 1t-1 +
= 2,j CAt-j += 3, j CFt-j + t .....(3)
CFt = 0
19
+ 1t-1 +
= 2,j CFt-j += 3, j CAt-j + t .....(4)
The t-1 in the equation (4) and (5) is the one period- delayed value of error term. It
shows how much of the short term instability is corrected in the long term. The same
equation is also estimated to test the short-run relationship through Wald test.
16
3
18
19
834
Data Analysis
In the study, the co-integration between the quarterly data of capital flows and current
account deficit in the seven emerging economies namely Brazil, China, India, Indonesia,
Russia, Mexico and Turkey covering the time period from 2005Q1 to 2015Q1 was analyzed
using the unit root and ARDL bound tests. In this context, the researcher attempted to predict
the direction of the relationship between the current account deficit and capital flows in these
economies domestic markets during the study period. In order to adjust the seasonality of the
variables, Eviews program has been employed. Data has been procured from the International
Monetary Fund data.
VARIABLES
LEVEL
test statistic
FIRST DIFFERENCE
Prob.*
test
Prob.*
statistic
CA
-1.496
.813
-5.194
0.0008
BRAZIL
CHINA
INDIA
INDONESIA
MEXICO
RUSSIA
TURKEY
CF
-5.110387*
0.0010
CA
-1.214789
0.8913
CF
-6.922
0.0000
CA
-0.520331
0.9765
CF
-5.995498
0.0001
CA
-3.602371
0.0430
CF
-3.696415
0.0348
CA
-4.125008
0.0126
CF
-7.992915
0.0000
CA
-5.498661
0.0003
CF
-5.946390
0.0001
CA
-3.490966
0.0548
835
-9.673458*
0.0000
-14.59698*
0.0000
-8.859980
0.0000
CF
-4.140340
0.0124
Table I report the results of the unit root test applied to determine the order of
integration among the time series data. The ADF test was used under the assumption of
constant and trend. According to the results of the test, Current Deficit (CA) is stationary at
level for Indonesia, Mexico and Russia whereas for economies Brazil, china, India and
Turkey current deficit is stationary at first difference. That is, the degree of integration of this
series is I (1). The result also indicates that Capital flows (CF) are stationary on level, that is,
the order of integration appears as I (0) among all the seven emerging economies.
Regression analysis
Based on the unit root test, if both series are stationary at level (there are no unit root),
then there may be ONLY a short run relationship between the variables. From the ADF test,
countries like, Indonesia, Mexico and Russia have both the variables stationary at level. So
there may exist only short run relationship between current deficit and capital flows for these
economies. In order to check the short run relationship, Ordinary least square (OLS)
regression analysis is used.
A. INDONESIA
Results pertaining to the direction of relationship between the current account deficit
and capital flows in the Indonesian domestic markets are reported in the table 2 and 3.
Table II: Ordinary Least Squares Regression Result of Indonesia-Dependent variable LCA
Variable
Coefficient
Std. Error
t-Statistic
Prob.
LCF
0.838592
0.084719
9.898523
0.0000
0.128232
0.667776
0.192028
0.8488
R-squared
0.725887
F-statistic
97.98076
Adjusted R-squared
0.718478
Prob(F-statistic)
0.000000
Durbin-Watson stat
1.669048
Table II displays the regression analysis of Indonesia. It can be inferred from the table
that there is a significant positive relationship between current deficit and capital flows. R-
836
squared value of the model is 0.725 which indicates that 72 percent variance in the current
deficit is explained by the capital flows.
Table III: Ordinary Least Squares Regression Result of Indonesia-Dependent variable LCF
Variable
Coefficient
Std. Error
t-Statistic
Prob.
LCA
0.865601
0.087448
9.898523
0.0000
0.163659
0.678249
0.241296
0.8107
R-squared
0.718478
F-statistic
97.98076
1.797259
Prob(F-statistic)
0.000000
Durbin-Watson stat
Regression results of Indonesia are showed in the table III. The result indicates that
there is a significant positive relationship between the variables. Based on the R-squared
value, it can be inferred that 73 percentage variations in the capital flows is explained by
current account.
Based on the regression analysis it is confirmed that there is bidirectional relationship
between current deficit and Capital flows in Indonesian domestic market.
B. MEXICO
The relationship between current deficit and capital flows of Mexico is presented in
the table 4 and 5.
Table IV: Ordinary Least Squares Regression Result- Dependent Variable: LCA
Variable
Coefficient
Std. Error
t-Statistic
Prob.
LCF
-0.005124
0.054122
-0.094669
0.9251
-7.621999
0.456407
-16.70000
0.0000
R-squared
0.000242
Adjusted R-squared
-0.026778
F-statistic
0.008962
Durbin-Watson stat
1.281085
Prob(F-statistic)
0.925088
From the table IV it can be inferred that there exist an insignificant relationship
between the current deficit and capital flows since the p-value is more than 0.05.Hence it can
be concluded that capital flows of Mexico does not influence current deficit.
837
Coefficient
Std. Error
t-Statistic
Prob.
LCA
-0.047264
0.499253
-0.094669
0.9251
-5.436153
3.950536
-1.376055
0.1771
R-squared
0.000242
Adjusted R-squared
-0.026778
F-statistic
0.008962
Durbin-Watson stat
2.025393
Prob(F-statistic)
0.925088
Table V speaks about the impact of current deficit on the capital flows of Mexico. The
result reveals that current deficit does not impact capital flows in the Mexican domestic
market.
C. RUSSIA
Table VI and Table VII illustrate the impact of capital flows on current deficit and current
deficit on capital flows in the Russian economy.
Table VI : Ordinary Least Squares Regression Result- Dependent Variable:
LCA
Variable
Coefficient
Std. Error
t-Statistic
Prob.
LCF
0.227365
0.071243
3.191397
0.0029
7.502362
0.674954
11.11536
0.0000
R-squared
0.215853
Adjusted R-squared
0.194660
F-statistic
10.18502
Durbin-Watson stat
2.025393
Prob(F-statistic)
0.002885
It has been found from table VI that there exist a positive and statistically significant
relationship between current deficit and capital flows of Russia. R-square value of the model
is 0.21 which imply 21 percent variation in current deficit is explained by capital flows.
Table VII: Ordinary Least Squares Regression Result- Dependent Variable: LCF
Variable
Coefficient
Std. Error
t-Statistic
Prob.
LCA
0.949367
0.297477
3.191397
0.0029
-1.023741
2.868067
-0.356945
0.7232
R-squared
0.215853
Adjusted R-squared
0.194660
F-statistic
10.18502
Durbin-Watson stat
2.190328
Prob(F-statistic)
0.002885
838
Table VII depicts the OLS regression analysis to examine the impact of current deficit
on capital flows in Russian economy. The result evidenced that current deficit has a positive
and significant impact on the capital flows
ARDL Bound Test
Since for the economies namely Brazil, India, China and Turkey, the variable Capital
Flow is stationary on level and Current deficit is stationary on first difference, so Auto
regressive distributed lag (ARDL) model can be used to determine the long run and short run
relationship between the two variables.
D. BRAZIL
The presence of co-integration between current deficit and capital flows in
Brazilian economy is estimated through ARDL approach and the results are presented
as follows:
Table VIII: F-Statistics Test for Long Run Co-integration-Dependent variable CA
k
F-statistic
6.3599
5%
10%
6.84 - 7.84
4.94 5.73
4.04 4.78
Table presents the result of ARDL Bound test. The value of F statistics is 6.359, when
compared to the critical values of the table, for it is more than upper critical values at five
percent level. According to the test results, the current account deficit and capital flows have
a co-integrating relationship. In other words, capital flows in Brazil between 2005 and 2015
really affect the current deficit in the long term.
So to estimate the short term relation an Error correction model is estimated and the
result is depicted in table IX.
Table IX: Error correction model results based on ARDL Approach
Variable
Coefficient
t-Statistic
Prob.
-0.463703
-1.423115
0.1654
DLCA(-1)
0.298409
1.659632
0.1078
DLCA(-2)
0.110174
0.699236
0.4900
DLCF
0.246264
3.456005
0.0017
DLCF(-1)
-0.256104
-2.092498
0.0453
839
DLCF(-2)
-0.241815
-2.652259
0.0128
ECT(-1)
-0.495703
-3.460692
0.0017
0.555447
F-statistic
6.039007
0.463470
Prob(F-statistic)
0.000343
Durbin-Watson stat
1.937480
R-squared
Adjusted R-squared
WALD TEST
F statistic
3.4336
Prob(F statistics)
0.043
Table IX displays the Error correction results for Brazil for a period 2005q1 to
2015q1. The significant value of F statistics in Wald test proves that there is short term
relationship between current account and lagged values of capital flows. The coefficient of
the error correction term in the model is negative and statistically significant. The estimated
coefficient value of -0.49 of the error correction mechanism implies that the system corrects
its previous periods disequilibrium from the long-run estimates by 49 percent quarterly. The
high significance of the coefficient of ECM term supports the existence of a long-run
equilibrium relationship between capital flows and current deficit. The result also reveals
that, R-squared value is 0.55, this indicates that 55 percent of the variations in the value of
current deficit are explained by capital flow. The F-statistic is significant at all levels
implying that the hypothesized relationship between variables is validated. The value of
Durbin-Watson statistic is 1.93 implying that the model is not suffering from autocorrelation
problem.
Table X: ARDL Bound test Results-Dependent Variable is CF
k
F-statistic
5.934953
5%
10%
Note: Critical Values are cited from Pesaran et al. (2001), Table CI (iii), Case 111:
Unrestricted intercept and no trend.
k is the no. of independent variables
According to the ARDL test results depicted in the table X, the F-statistics value
(5.93) is more than upper critical values at five percent significant level. Therefore, the F
value is statistically meaningful. So there is co- integration between the current deficit and
capital flows of Brazil.
Table XI: Error correction model results based on ARDL Approach
840
Variable
Coefficient
t-Statistic
Prob.
-0.370075
-0.667524
0.5108
DLCF(-2)
0.027191
0.217999
0.8293
DLCF(-3)
-0.029602
-0.185519
0.8544
DLCF(-4)
-0.034336
-0.250525
0.8043
DLCA
1.251767
5.620225
0.0000
DLCA(-1)
0.233249
0.994072
0.3301
DLCA(-2)
-0.389169
-1.507749
0.1447
DLCA(-3)
0.096472
0.371738
0.7133
DLCA(-4)
-1.147491
-4.788675
0.0001
ECT(-1)
1.048717
7.168911
0.0000
0.837218
F-statistic
13.71518
0.776175
Prob(F-statistic)
0.000000
Durbin-Watson stat
1.532929
R-squared
Adjusted R-squared
WALD TEST
F statistic
6.4066
Prob(F statistics)
0.0012
An error correction model result for Brazil is depicted in table XI. The probability
value of F statistics in Wald test provide evidence that there is short term relationship between lagged
values of current account and capital flows. The coefficient of the error correction term in the
model is positive but statistically significant. The high significance of the coefficient of ECM
term supports the existence of a long-run equilibrium relationship between capital flows and
current deficit. The results also disclose that, R-squared value is 0.83, this indicates that 83
percent of the variations in the value of capital flows are explained by current deficit. The Fstatistic is significant at all levels implying that the hypothesized relationship between
variables is validated. The value of Durbin-Watson statistic is 1.53 implying that the model is
not suffering from autocorrelation problem.
E. CHINA
To test the long run and short run relationship between the current deficit and capital
flows of China, ARDL model and Error correction model is estimated and the results are
shown
Table XII: ARDL Bound test Results-Dependent Variable is CA
K
F-statistic
841
5%
10%
1.318241
It can be inferred from table XII that the value of F statistics is 1.31, which is small as
compared to the lower critical values. Therefore, F statistics is statistically meaningless. So
there is no co-integration between the current deficit and capital flows of China during the
period from 2005 to 2015.
Table XIII: ARDL Bound test Results-Dependent variable CF
F-statistic
12.66105
5%
10%
Table XIII displays the co-integration result based on ARDL Bound test. The FStatistics value in the model is 12.66, which is greater than the upper bound critical values at
five percent significant level. Hence it can be concluded from the empirical evidence that
there exist co-integration between the capital flows and current deficit of China.
Since there exist co-integration between the variable, an ECM is estimated to
determine the short term relationship and the results is exhibited in table XIV.
Table XIV: Error correction model results based on ARDL Approach
Variable
Coefficient
t-Statistic
-0.104414
-0.139091
0.8903
DLCF(-1)
0.134602
0.694027
0.4928
DLCA
0.545757
3.756488
0.0007
DLCA(-1)
-0.032819
-0.193949
0.8475
ECT(-1)
-0.521433
-5.102272
0.0000
R-squared
0.694125
F-statistic
17.58718
Adjusted R-squared
0.654658
Prob(F-statistic)
0.000000
Durbin-Watson stat
842
Prob.
1.886147
WALD TEST
F statistic
12.66105
Prob(F statistics)
0.0001
Table XIV explains the error correction model result of China. The probability value
of F statistics in Wald test provide evidence that there is short term relationship between lagged
values of current account and capital flows. The coefficient of the error correction term in the
model is negative and statistically significant. The high significance of the coefficient of
ECM term supports the existence of a long-run equilibrium relationship between capital
flows and current deficit. The results also disclose that, R-squared value is 0.69, this indicates
that 69 percent of the variations in the value of capital flows are explained by current deficit.
The F-statistic is significant at all levels implying that the hypothesized relationship between
variables is validated. The value of Durbin-Watson statistic is 1.88 implying that the model is
not suffering from autocorrelation problem.
F. INDIA
Table XV: ARDL Bound test Results-Dependent variable CA
K
F-statistic
0.996235
5%
10%
F-statistic
6.067229
5%
10%
According to the ARDL test result shown in the table XVI, the F-statistics
value (6.06) is more as compared to the upper bound critical values at five percent
843
Coefficient
t-Statistic
Prob.
-0.875947
-0.714617
0.4824
DLCF(-2)
0.010903
0.058463
0.9539
DLCF(-3)
0.013686
0.064825
0.9489
DLCF(-4)
0.445450
2.358727
0.0276
DLCA
-1.256325
-2.597933
0.0164
DLCA(-1)
-0.750629
-1.110741
0.2787
DLCA(-2)
-0.651568
-0.959414
0.3478
DLCA(-3)
-0.495722
-0.793876
0.4357
DLCA(-4)
0.190112
0.431684
0.6702
ECT(-1)
-0.453462
-2.748997
0.0117
R-squared
0.626482
F-statistic
4.099933
Adjusted R-squared
0.473679
Prob(F-statistic)
0.003312
Durbin-Watson stat
2.284320
WALD TEST
F statistic
0.90968
Prob(F statistics)
0.4756
Table XVII report the Error correction results of India for the period from 2005q1 to
2015q1. The significant value of F statistics Wald test is 0.47 which is more than 0.05.Thus
the result proves that there is no short term relationship between capital flows and lagged
values of capital deficit. The coefficient of the error correction term in the model is negative
and statistically significant. The estimated coefficient value of -0.45 of the error correction
mechanism implies that the system corrects its previous periods disequilibrium from the
long-run estimates by 45 percent quarterly. The high significance of the coefficient of ECM
term supports the existence of a long-run equilibrium relationship between capital flows and
current deficit. The result also reveals that, R-squared value is 0.62, this indicates that 62
percent of the variations in the value of capital flows are explained by current account. The Fstatistic is significant at all levels implying that the hypothesized relationship between
844
variables is validated. The value of Durbin-Watson statistic is 2.28 implying that the model is
not suffering from autocorrelation problem.
G. TURKEY
Table XVII, XIX and XX explain the long run and short run relationship between
current deficit and capital flows in Turkish domestic market.
Table XVIII: ARDL Bound test Results-Dependent variable CA
K
F-statistic
3.256459
5%
10%
According to the ARDL test result shown in the table above, the F-statistics
value (3.25) is small as compared to the lower bound critical values. Therefore the F
value is statistically meaningless. So there is no co-integration for the model. In other
words, capital flows in Turkey between 2005 and 2015 did not really affect the
current deficit in the long term.
Table XIX: ARDL Bound test Results-Dependent variable CF
k
F-statistic
14.23823
5%
10%
The value of F statistics was calculated for the ARDL bound test and the
results are displayed in table XIX. According to test results, the current account deficit
of capital flows has a co integrating relationship. The value of F statistics is 14.23.
The F statistics value, when compared to the critical values of the table, for it is more
than all upper critical values, shows that there is a co-integrating relationship between
the variables.
Table XX: Error correction model results based on ARDL Approach
Variable
Coefficient
t-Statistic
Prob.
0.074847
0.161827
0.8725
DLCF(-1)
0.510686
3.265743
0.0026
845
DLCA
3.570295
4.222778
0.0002
DLCA(-1)
0.148658
0.173706
0.8632
ECT(-1)
-0.964401
-5.396033
0.0000
R-squared
0.537312
F-statistic
9.290288
Adjusted R-squared
0.479477
Prob(F-statistic)
0.000042
Durbin-Watson stat
1.890690
The result in table XX exhibits the error correction model with LCF as the dependent
variable. The probability value of ECT is statistically significant and the coefficient is
negative. Therefore the relationship between capital flows and current deficit is meaningful.
Conclusion
The study investigated the relationship between current deficit and capital flows in
emerging economies from 2005Q1 to 2014Q. As a result of unit root tests done in order to
check the stability of current account (CA) and capital flows (CF) series, it was found that the
CF series is stable at level for all the selected economies whereas CA was stable when the
first difference was taken among India, Brazil, China and Turkey. So ARDL bound test has
been applied to test if there is co-integration between CA and CF since variables had different
order of integration. The study suggests that when there is a unidirectional causality running
from CF to CA, then a CF liberalization policy would give way to a deterioration of CA
balance. On the other hand, unidirectional causality running from CA to CF would indicate
that capital liberalization policies could be implemented with little or adverse effect on
Current account deficit.
References
1. Yusuf Ekrem Akbas, Mehmet Senturk and Canan Sancar(2014), The
relationship between capital flows and current deficit:Evidence from Turkey,Indian
Journal of Finance,Vol.8.No.11,November 2014,pp7-22.
2. Mounir BELLOUMI ,The relationship between Trade, FDI and Economic growth
in Tunisia: An application of autoregressive distributed lag model
3. Mohsen Mehrara, Mostafa Sargolzaei, Razieh Ahmadi, Marzieh Ahmadi (2012),
Investigating the Relation between Financial Development and Economic Growth
Using ARDL Approach Case study: Iran, Journal of Basic and Applied Scientific
Research, J. Basic. Appl. Sci. Res., 2(6)5932-5936, 2012 2012,ISSN 2090-4304.
4. Abid Ali Shah , RehanaKouser , Muhammad Aamir Irum Saba (2012),
Empirical Analysis of Long and Short Run Relationship among Macroeconomic
846
Variables and Karachi Stock Market: An Auto Regressive Distributive Lag (ARDL)
Approach, Pakistan Journal of Social Sciences (PJSS) Vol. 32, No. 2 (2012), pp.
323-338
5. Rao Muhammad Atif , Abida Jadoon, Khalid Zaman , Aisha Ismail, and Rabia
Seemab (2010), Trade Liberalisation, Financial Development and Economic
Growth:
Evidence
from
Pakistan,
Journal
of
international
academic
847
ABSTRACT:
Sustaining and accelerating the growth momentum of a country needs an increased
participation of the economically vulnerable segments of population, in the process of
economic growth. As India is moving towards higher growth trajectory, financial inclusion is
the road in which it needs to travel towards becoming a global player. Financial inclusion of
excluded segments of population is a critical part of this process of inclusion. The researcher
identifies the research potential in exploring the problems of bank in rural areas in achieving
financial inclusion. This paper covers two districts of Karnataka as sample for collecting
primary data through structured questionnaire as well as interview with rural bank staff.
Mean percentages, chi-square test and ANOVA tools have been used to test the hypothesis.
The result highlights that there is no significant difference between population occupations
and also there is a significant difference between occupation and the level of awareness of
banking products and services. Even today rural people depend on money lenders for loan.
There is a potential for banking industry to augment finance and include the unserved people
by bringing them into the main fold of financial inclusion.
KEY WORDS: Rural, Banking, Financial Inclusion, Inclusive Growth.
INTRODUCTION:
848
BACKGROUND
Although tremendous reforms and developments have been taken place in the banking sector
in India since 1960s, from 1990s the focus has shifted to strengthening financial institutions
as part of the financial sector reforms. The developments in banking technology in the second
half of 1990s have transformed banking from staffed branches to a system supplemented by
other channels like automated teller machines (ATMs), credit/debit/visa cards, internet
banking, online money transfer, etc. Despite the tremendous growth in volume and
complexity of banking industry during the last few decades, there are concerns that banks
have not been able to include vast majority of the population, especially the underprivileged
sections of the society, into the fold of basic banking services. Efforts are being made,
internationally also, to study the causes of financial exclusion and designing strategies to
ensure financial inclusion of the poor and disadvantaged. The reasons may vary from country
to country and hence the strategy could also vary but all our efforts are being made as
financial inclusion can truly lift the financial condition and standards of life of the poor and
the disadvantaged.
FINANCIAL EXCLUSION
Since there is large section of the population who lacks access even to the most basic
banking services, there is said to be financial exclusion. Out of 600000 habitations in the
country only about 30000 have a commercial bank branch. Only about 40 percent of the
population across the country has bank accounts, and this ratio is much lower in north east
states of India. The proportion of people having any kind of life insurance cover is as low as
849
10 percent and proportion having non-life insurance is very low at 0.6 percent. People having
debit cards comprise only 13 percent and those having credit cards only marginal 2 percent.
As per national sample survey (2003) out of the 89.3 million farmer households in the
country, 51 percent did not seek credit either from institutional or non-institutional sources of
any kind. Out of 19.9 crore households in India, only 6.82 crore households have access to
banking services. In rural area, out of 13.83 crore rural households in India, only 4.16 crore
rural households have access to basic banking services. In respect of urban areas, only 49.52
percent of urban households have access to banking services. Over 41 percent of adult
population in India does not have bank account.
The problem of financial exclusion is not India specific; rather it is a global phenomenon. It
is evident from the fact that 2.5 billion adults, which is just over half of the worlds
population, do not use formal financial services to save or borrow. Moreover, about 2.2
billion of these un reached adults live in Africa, Latin America, and Middle East.
As a solution to the above problem, Financial Inclusion has become an issue worldwide, and
a concern equally in developed, developing and underdeveloped economies. Building an
inclusive financial sector has emerged a growing global recognition bringing to the fore the
need for developing strategies that touch all lives, instead of a few selected population.
Reserve Banks Initiatives towards Financial Inclusion
RBI launched NATIONAL STRATEGY FOR FINANCIAL EDUCATION on July 16, 2012
with a vision to build a financially aware and empowered India with the following goals:
o To create awareness and educate consumers, on access to financial services,
availability of various types of products and their features.
o To change attitudes to translate knowledge into behavior
o To make consumers understand their rights and responsibilities as clients of financial
services.
The Reserve Banks approach towards Financial Inclusion aims at connecting people with
banking system and not just opening accounts. This includes meeting small credit needs of
the people, giving them access to the payments system and providing remittance facilities.
Since past couple of years the Reserve Bank has adopted the following strategy towards
financial inclusion:
850
(a) No frills accounts: In November 2005, the RBI asked the banks to offer a basic banking
.no frills. Account with low or zero minimum balances and minimum charges to expand the
outreach of such accounts to the low income groups.
(b) Easier credit facility: Banks were asked to introduce a General Purpose Credit Card
(GCC)
Facility up to Rs. 25,000. By end March 2009, 0.15 million GCC were issued.
(c) Simpler KYC norms: KYC procedure for opening accounts was simplified for those
accounts with balances not exceeding Rs.50,000 and credits thereto not exceeding
Rs.1,00,000 in a year.
(d) Use of Information Technology: (a) Smart cards for opening bank accounts with
biometric identification. These would help the customers to get the banking services at their
doorsteps.(b) Link to mobile handheld electronic devices for banking transactions.
(e) EBT: The Reserve Bank is in consultation with state governments to encourage them to
adopt Electronic Benefit Transfer (EBT) system.
(f) 100 per cent financial inclusion drive: The RBI launched a financial inclusion drive
targeting one district in each state for 100 per cent financial inclusion.
(g) Business Correspondent Model: The Business Correspondent (BC) model ensures a
closer relationship between the poor people and the organized financial system. In 2006, the
banks were permitted to use the services of NGOs, Micro-finance institutions, retired
government employees, etc. to act as business correspondents in providing financial and
banking services.
(h) Bank branch and ATM expansion liberalized: In 2009, RBI totally freed location of
ATMs from prior authorization. In October 2009, branch opening was made free in towns
and villages with population below 50,000.
(i) Project financial literacy : It includes the (i) spread of financial education through
website in 13 languages; (ii) opening of credit counseling centres in the country to provide
financial education to people in rural and urban areas on the various financial products; (iii)
introduction of financial curriculum in schools and colleges.
(j) Financial Inclusion Plan (FIP): Banks are asked to formulate a board.approved Financial
Inclusion Plan which must be integrated with the normal business plans for a period of three
years.
CHALLENGES OF FINANCIAL INCLUSION
Due to limited literacy, especially financial literacy, there is lack of awareness about
the financial services and products;
851
The financial products are unsuitable for low income groups and the attitude of banks
towards such customers is unfriendly & unempathetic;
The low income groups cannot fulfill KYC norms due to lack of proper documents
regarding identity, address, income proof, etc;
The fees charged by banks are exorbitant & non-transparent; apart from this the terms
and conditions are burdensome;
Hence, in order to achieve proper Financial Inclusion, it is necessary for the banks to
overcome the above-mentioned challenges in due course.
In India, a committee was set up under the chairmanship of Dr. C. Rangarajan to suggest
measures to increase financial inclusion. The Committee submitted its final Report on
January 4, 2008. The Report viewed financial inclusion as a comprehensive and holistic
process of ensuring access to financial services and timely and adequate credit, particularly
by vulnerable groups such as weaker sections and low income groups at an affordable cost.
According to Rangarajan committee, financial inclusion should include access to mainstream
financial products such as bank accounts, credit, remittances and payment services, financial
advisory services and insurance facilities. Several steps have been taken by the various banks,
NGOs and government to bring the financially excluded people to the fold of the formal
banking services. The 100 per cent financial inclusion drive is progressing all over the
country. Financial inclusion is necessary not only in urban areas; rather, the focus should be
on the rural vulnerable section, where abundant potential can be expected. Since financial
inclusion is necessary in rural area is necessary and profitable for banking sectors, the focus
of the present study is on the financial inclusion among the rural people with the help of
sample survey. Hence, the problem of study is FINANCIAL INCLUSION IN RURAL
KARNATAKA: AN EMPIRICAL STUDY ON.
Several studies on financial inclusion worldwide were found to be more of analytical and
based mainly on the secondary data. We found hardly empirical or exploratory studies in the
852
Indian scenario. The present study is based on the survey conducted in the rural area for the
problem of financial exclusion.
Moreover, the study contributes to the existing literature by exploring the new dimensions of
problems faced by the rural people in banking services that cause the financial exclusion. The
policy makers in the financial institutions and the banking sector can make use of the
suggestions based on the survey results and thereby increase their financial services by
designing innovative methods for the millennium goal of RBI and finance sector of the
country.
LITERATURE REVIEW
Banks would have to evolve specific strategies to expand the outreach of their services in
order to promote financial inclusion. One of the ways in which this can be achieved in a costeffective manner is through forging linkages with micro finance institutions and local
communities. Banks should give wide publicity of no frills account. Banks need to redesign
their business strategies to incorporate specific plans to promote financial inclusion of low
income group treating it both a business opportunity as well as a corporate social
responsibility (V.Leeladhar, 2005).
In recent years, Indian banking sector is grappling with the issue of financial inclusion. But, it
is not altogether a new exercise. Financial inclusion was envisaged and embedded in Indian
853
credit policies in the earlier decades also, though in a disguised form and without the same
nomenclature (Rao, 2007).
Laveesh Bhandari and Sumitha Kale (2008) in their research paper titled Digital
Payments and Financial Inclusion emphasized the present scenario and the paper has brought
out the importance of embracing technology as a cost effective measure to improve financial
inclusion. Payments through mobile phones have been suggested as the most appropriate
measure.
Micro-finance offers significant potential for achieving financial inclusion. The experience of
the bank in this segment has been quite encouraging. In the words of Prof.C.K.Prahalad If
we stop thinking of the poor as victims or as a burden and start recognizing them as resilient
and creative entrepreneurs and value conscious consumers, a whole world of opportunity will
open up (K.C.Chakrabarty, 2008).
Increasing proliferation of mobile services and ATMs in rural areas of India has created a
new opportunity to attain financial inclusion and thus an effective tool to provide financial
services to the un-banked areas
Cole et al. (2009) concluded that financial literacy program has no effect on the likelihood of
opening a bank savings account, but do find modest effects for uneducated and financially
illiterate households. In contrast, small subsidy payments have a large effect on the likelihood
of opening a savings account. These payments are more than two times more cost-effective
than the financial literacy training.
According to Ravichandran and Alkhathlan (2009), very few people have access to
banking services. There are number of factors affecting access to financial services by weaker
section of society in India. The lack of awareness, low incomes and assets, social exclusion,
illiteracy are the barriers from demand side. The distance from bank branch, branch timings,
cumbersome banking procedure, over requirement of documents for opening bank accounts,
unsuitable banking products/schemes, language, high transaction costs and attitudes of bank
officials are the barriers from supply side. Bank-SHG, bank-MFI, MFI-NBFC and bank- post
office linkage models were discussed and new models like rural students banking model,
RBI-Education institute linkage models were proposed.
854
Reddy (2010) suggested a new approach to banks to reach wider population in rural areas by
establishing mobile-banks/representatives/agents who operate on commercial basis rather
than just by self-help groups. These agents/representatives work on commission basis and
hence self-motivated and cost effective in assisting banks in service provision/deposit
mobilization.
To boost micro financing initiatives and financial inclusion program banks are deploying
Biometric ATM solutions to its rural customers helping illiterate or barely literate folks to
become part of the banking user community (Biswas, 2010).
There are still emerging innovative ideas such as Banking without banking, banking through
mobile phone, inclusion through business correspondents, social stock exchange, legal
inclusion of properties, mainstreaming the slum dwellers, etc. Since, the challenges of
financial inclusion are multifaceted and dynamic in nature, consistent study on the
requirements and perception of the rural people is sought to be continued. With this
background the present paper addresses the problems and reasons for low financial inclusion
in rural Karnataka.
eight villages were chosen as sample units and 30 questionnaires were got filled from the
respondents of each village as shown below.
Hassan District:
Mandya District:
Suranahalli
30
Kesturu
30
Padavalahippe
30
Besagarahalli 30
Hirisave
30
Koppa
30
srinivasapura
30
Belluru
30
The data collected were tabulated and chi- square test, ANOVA was used through SPSS 16.0
version package.
FEMALE
TOTAL
Column N
Count
AGE
Count
Count
BELOW 25 54
33.8%
15
18.8%
69
28.8%
25-40
83
51.9%
41
51.2%
124
51.7%
ABOVE 40 23
14.4%
24
30.0%
47
19.6%
Subtotal
160
100.0%
80
100.0%
240
100.0%
38
23.8%
23
28.8%
61
25.4%
93
58.1%
35
43.8%
128
53.3%
16
10.0%
17
21.2%
33
13.8%
OCCUPA FARMER
TION
JOBWORK
ER
LAND
LABOUR
856
OWN
BUSINESS
Subtotal
EDUCATI SSLC&
ON
BELOW
PUC
GRADUATI
ON
Subtotal
ANNUAL BELOW
INCOME 30000
13
8.1%
6.2%
18
7.5%
160
100.0%
80
100.0%
240
100.0%
114
71.2%
44
55.0%
158
65.8%
35
21.9%
27
33.8%
62
25.8%
11
6.9%
11.2%
20
8.3%
160
100.0%
80
100.0%
240
100.0%
120
75.0%
62
77.5%
182
75.8%
16.2%
13
16.2%
39
16.2%
14
8.8%
6.2%
19
7.9%
160
100.0%
80
100.0%
240
100.0%
30000-60000 26
ABOVE
60000
Subtotal
857
OCCUPATION
FARMER
What is you NO
initial
ACCOUNT
deposit?
less than 50
50-100
100-500
more than 500
Subtotal
you 500-1000
deposit?
1000-5000
above 5000
Subtotal
JOBWORKE LAND
OWN
Subtota
BUSINESS
LABOUR
14
23.0% 43
33.6% 10
30.3% 1
5.6%
68
10
16.4% 12
9.4%
6.1%
.0%
24
15
24.6% 26
20.3% 4
12.1% 0
.0%
45
4.9% 10
7.8%
12.1% 0
.0%
17
19
31.1% 37
28.9% 13
39.4% 17
94.4%
86
100.0
100.0
100.0
61
128
33
18
100.0% 240
19
31.1% 16
12.5% 11
33.3% 6
33.3%
52
31
50.8% 79
61.7% 16
48.5% 4
22.2%
130
13.1% 27
21.1% 6
18.2% 8
44.4%
49
4.9% 6
4.7%
.0%
.0%
100.0
100.0
18
100.0% 240
61
128
0
33
100.0
%
14
23.0% 43
33.6% 10
30.3% 1
5.6%
68
47
77.0% 80
62.5% 23
69.7% 0
.0%
150
.0%
.0%
.0%
55.6%
10
858
10
28.3
%
10.0
%
18.8
%
7.1%
35.8
%
100.0
%
21.7
%
54.2
%
20.4
%
3.8%
100.0
%
28.3
%
62.5
%
4.2%
FIXED
DEPOSIT A/C
Subtotal
61
.0%
100.0
%
128
3.9%
100.0
%
33
.0%
100.0
%
38.9%
12
18
100.0% 240
5.0%
100.0
%
859
Chart 1 indicates that 69 member of the sample visit bank once in a month. This may be for
people who avail government social security money once in a month, visit to withdraw
money. 45 members visit twice in a month. SHG members visit 4 times a month for their
banking transactions. Rest of the people is not utilizing the banking services. The reasons
quoted by the respondents are to withdraw money, and they do not have any transactions to
do with the bank. Farmers and job workers do not have the opportunity to visit and avail
bank services due to lack of financial knowledge, timing and procedural difficulties to the
rural people. Even the attitude of the bank staff, and banks situated mostly in hoblies and
Taluks. They find no time because of their job. Rural respondents opinion for not availing
bank services and not opening bank account has been compiled in the descriptive statistics
from 3 to table 11. Most of the people are not aware of the minimum bank products and
services such as pass book, cheque book, credit card and debit card. Only respondents
running the small business avail these services and most of the people have only saving bank
account without ATM card. Rural people do not have the knowledge of mobile banking and
money transfer facility. Every bank now-a-days print challans and documents in kannada
860
language also that help rural population to understand the procedure without any hassle. Test
statistics shown in table 12 signifies that the level of awareness about Chart: 2
The services availed by the rural people in Karnataka. Due to lack of knowledge and literacy,
and the interest in various unwanted services which are not relevant as perceived by the
population, these services not popular even today in rural areas.
Table 3
Due to Lack of financial knowledge i had no account before
Frequency Percent
Valid Agree 240
100.0
Valid
Cumulative
Percent
Percent
100.0
100.0
Table 4
Due to Low incomes and assets I had no account before
861
Valid
Cumulative
Frequency Percent
Percent
Percent
108
45.0
45.0
45.0
Indifferent 45
18.8
18.8
63.8
Disagree
87
36.2
36.2
100.0
Total
240
100.0
100.0
Valid Agree
Table 5
Cumulative
Frequency Percent
Percent
Percent
162
67.5
67.5
67.5
indifferent 24
10.0
10.0
77.5
Disagree
54
22.5
22.5
100.0
Total
240
100.0
100.0
Valid Agree
Valid Agree
Valid
Cumulative
Frequency Percent
Percent
Percent
207
86.2
86.2
86.2
6.7
6.7
92.9
indifferent 16
862
Disagree
17
7.1
7.1
100.0
Total
240
100.0
100.0
Cumulative
Frequency Percent
Percent
Percent
191
79.6
79.6
79.6
indifferent 25
10.4
10.4
90.0
Disagree
24
10.0
10.0
100.0
Total
240
100.0
100.0
Valid Agree
Cumulative
Frequency Percent
Percent
Percent
205
85.4
85.4
85.4
indifferent 11
4.6
4.6
90.0
Disagree
24
10.0
10.0
100.0
Total
240
100.0
100.0
Valid Agree
Cumulative
Frequency Percent
Percent
Percent
187
77.9
77.9
77.9
indifferent 17
7.1
7.1
85.0
Disagree
36
15.0
15.0
100.0
Total
240
100.0
100.0
Valid Agree
863
Cumulative
Frequency Percent
Percent
Percent
194
80.8
80.8
80.8
indifferent 29
12.1
12.1
92.9
Disagree
17
7.1
7.1
100.0
Total
240
100.0
100.0
Valid Agree
Cumulative
Frequency Percent
Percent
Percent
196
81.7
81.7
81.7
indifferent 20
8.3
8.3
90.0
Disagree
24
10.0
10.0
100.0
Total
240
100.0
100.0
Valid Agree
Table 12 shows ONE-WAY ANOVA for testing the null hypothesis (H01) that there is no
significant difference between the occupations and the level of satisfaction towards bank
services. As per table 12 computed value of F is 1.463 which is less than the critical value
(2.60). Therefore, there is not enough evidence to reject our null hypothesis (H01) and hence
can be inferred that there is no significant difference between the occupation and the level of
satisfaction. In fact the population, irrespective of their occupation, do not enjoy the
satisfactory services of rural banks and co-operative banks. Perhaps this may be construed as
one of the reasons for lacunae in financial inclusion in rural Karnataka.
Table 12:ANOVA
Are you satisfied with the products which are offered by your
bank?
Sum
Between
Groups
of
Squares
df
Mean Square F
Sig.
4.816
1.605
.225
864
1.463
236
Total
239
263.796
1.097
Table 13
ANOVA of OCCUPATION*AWARENESS
Sum
Squares
df
Mean Square F
Sig.
4.045
1.348
2.970
.033
236
.454
Total
111.183
239
1.882
.627
2.937
.034
236
.214
Total
52.296
239
4.838
1.613
3.244
.023
236
.497
Total
122.163
239
8.347
2.782
14.076
.000
236
.198
Total
54.996
239
7.556
2.519
13.792
.000
236
.183
Total
239
Groups
Passbook
Groups
Between
Groups
Cheque Book
Between
Groups
Loans
of
Between
Groups
50.650
865
Overdraft
Between
.959
236
.086
Total
23.183
239
1.426
.475
236
.072
Total
18.333
239
2.054
.685
236
.440
Total
239
Groups
General
credit
card/ Between
Kisan CC
Groups
Between
Groups
2.878
105.983
11.151
.000
6.636
.000
1.555
.201
Table 13 shows computed value of chi-square test to test the second null hypothesis (H11)
that there is no significant difference between the occupation and level of awareness and
availing of services. As the computed values in all the variables at 3 degrees of freedom is
more than the critical value at 5% level of significance (2.60), our null hypothesis is rejected
and confer that occupation determines the level of awareness. However, in the case of
ATM/Debit cards and credit cards, only people with own business aware and availing the
services. This reflects that except private and public sector commercial banks, rural cooperative banks and Grameen banks do not provide such services. Provision of innovative
services may attract large sections of the society who are out of the service network.
Therefore, in India, financial inclusion is a great challenge at this movement unless a vast
campaign and banking literacy is initiated by the banking and finance industry.
As major chunk of the population do not have bank account, it is time to bring these
population into the fold of banking services. Findings of the study highlights that there is a
866
great potential for commercial banks to step into this arena to effect financial inclusion.
Attractive products and services shall be innovated that most suited to the rural peasants and
wage earners. Aadhar based cash disbursement and rural employment guarantee programmes
and other schemes may boost up the banking sector to explore more opportunity to augment
abundant financial resources and thereby provide in time credit facility to the needy for both
agricultural development and entrepreneurial development. The study notes that even today
rural people depend much on money lenders and do not avail bank loans due to collateral
insistence and delayed procedures. Therefore, to build confidence among the people, the
banks should streamline the credit and lending policies and procedures that are customer
friendly. Customized Credit card and Debit card facility is another innovative idea that the
banks should look into. Moreover, the banks and financial institutions must conduct a timely
campaign to create awareness and banking and financial literacy through customer friendly
advertisements. The policy of the RBI should be more rural oriented and focus much on
farmers and youth. It is also advisable to make it mandatory all the students and Aadhar card
holders to have a bank account to transact and increase financial awareness and financial
inclusion. Zero balance accounts at the village for every citizen can be made mandatory.
Bank officials may adopt different alternative documents to open the account rather than
insisting on one specified document.
Summarily, in the present paper the researcher analysed the relevant primary data through
questionnaire and secondary data to find the problems of financial inclusion in rural
Karnataka. The study shows that the lack of financial knowledge, low income, and problems
pertaining to banks operations and procedures are the major problems in rural area. Through
test statistics such as chi-square test and ANOVA, both the hypothesis were tested and
pertinent suggestions to augment financial resources and achieve the inclusive growth, the
vision of Dr. Amarthyasen, increasing the commercial banks branches and modernizing rural
and co-operative banks. Only when the rural population come out of poverty and come to
mainstream by increasing the standard of life, the countries inclusive growth can be achieved.
REFERENCE:
867
in
India
Solution
-Ultimate
for
its
Popular
Usage,
(accessed
on 10-04-2013)
9. Kothari.C.R.(2010). Research Methodology-methods and
techniques,New Age
Publishers
10. Madurai, K. (2011), Financial Inclusion in India, http://ssrn.com/abstra [accessed
09-04-2013)
11. Mahajan, V. & Laskar, S. (2010), Transition and Innovation in Rural Finance in
India - A Call for Action in this Golden Decade,
12. Pal, K. & Sura, J. (2006), Efficacy of Regional Rural Banks (RRBs) in India: A
Conventional Analysis, The Journal of Indian Management and Strategy, 11(4), 412.
13. Ravichandran, K. & Alkhathlan, K. (2009), Financial Inclusion - A Path towards
India's Future Economic Growth, http://ssrn.com/abstract (accessed on 10-04-2013)
14. Reddy,
A.
(2010),
Rural
Banking
Strategies
for
Inclusive
Growth,
868
HARSHINI C S
RESEARCH SCHOLAR, GOVERNMENT R C COLLEGE, RECOGNIZED RESEARCH CENTRE,
BANGALORE UNIVERSITY
DR VENUGOPAL
GUIDE/PRINCIPAL, GOVERNMENT FIRST GRADE COLLEGE,
KANAKAPURA, BANGALORE
Abstract
Todays consumers hop from screen to screen according to their needs of the moment. They dont
give a thought to what channel they are using to interact with brands, they simply expect brands
to keep up. Newspapers and Television continues to play a big role in driving sales for E-commerce
clients. TV Attribution not only offers a new and immediate view of mass media impact, it allows
people to create more cross-channel synergy. Todays consumers want immediate gratification and
have high expectations for the brands they pursue. With an increase in internet penetration, more
and more marketers are using online advertising business. Traditional advertisers have started
allocating more of their marketing budgets to the web. They are spending more online and now the
growth of wireless Internet access and broadband is surely painting a promising picture for the
industry. Advertisers have recognised that people are spending more time online and consuming
more online media. The E-Commerce sector has witnessed an exponential growth in the country in
the past few years, and more and more companies continue to invade into the market seeing the
vast potential it holds. With the technology advancements, some companies have already carved a
niche for themselves, by penetrating fast into the market. Investors are pumping a lot of money into
the e-tailers, as they see promising prospects for their growth. But brands cannot rely solely on
digital media to create high impact in a short span of time especially when reaching out the mass
audiences. They need a certain amount of influence from traditional media. The present paper
869
attempts to study whether Television and Print media is still a high impact campaign for E-commerce
companies.
Key words: Advertisement, E-Commerce marketing, Television media, Print media, Offline, Online.
Introduction
Ever since the first display advertisements appeared on computer screen, the Internets challenge
over existing advertising has been the ability to target the audience more precisely and measure the
impact of the advertisements. Although traditional media still holds strong ground in the Indian ad
space, digital advertising is catching up fast and is expected to overtake traditional media within the
next 5-10 years. In addition to the increasing adoption of mobile devices, the increasing connectivity
and improvements in broadband infrastructure will lead to increased investments in more content
rich, video and social media advertisements.
The gradual increase in adaptation of Internet has opened the door to the marketers to go online
and spend on digital advertisement. With mobile devices becoming a predominant mode of Internet
access among the users in India, adoption of internet is expected to increase still further. The
changing dynamic will be best placed to generate new sales and capitalise on consumers desire to
use their smartphone for research and purchase products more in the future. The more connected
devices consumers own, the more their behaviours change and the more complex purchasing habits
become.
Statement of problem
The increase in adoption of Internet and the penetration of e-commerce throws valid questions to ECommerce companies.
1. Why do E-commerce companies advertise offline?
2. Is print a high impact campaign for starters?
3. Do Traditional ads continue to play a big role in driving sales for e-commerce clients?
1. To recognize key drivers in Indias e-commerce, its market and its growth.
2. To compare top e-commerce companies with the most visited websites in India.
3. To understand the impact of TV attribution with digital insight.
20
http://www.iamai.in/media/details/4490#sthash.aaD2QKdG.dpuf
871
Source: Internet in India 2015 by the Internet and Mobile Association of India (IAMAI) and IMRB
international. The IAMAI-IMRB survey was conducted across 35 cities with more than one million population,
including eight large metros and smaller cities, including Coimbatore, Jaipur, Lucknow, Ludhiana and
Visakhapatnam.
Online communication, social networking and entertainment are the top reasons for accessing the
Internet. Only 25% of urban users and 5% of rural users accessed the internet for online shopping.
E-Commerce in India
872
Electronic commerce, commonly written as e-commerce, is the trading in products or services using
computer networks, such as the Internet. Despite being second largest user base in world, the
penetration of e-commerce is low compared to markets like the United States, United Kingdom or
France but is growing much faster, adding around 6 million new entrants every month21. The
industry consensus is that growth is at an inflection point22. As of Q1 2015, seven Indian e-commerce
companies have managed to achieve billion-dollar valuation. Namely, Flipkart, Snapdeal, InMobi,
Quikr,Amazon India, OlaCabs, and Paytm.
Top 10 E-Commerce companies in India-2015
Here is list of the top 10 e-commerce companies in India. With the rise of the internet and increase
in the number of smartphones, the online shopping industry has become a force to reckon with its
enormous growth across the world. Some of the biggest names in the e-commerce industry have
emerged which have done businesses in a huge volume through websites and apps. The list is based
on latest figures available23 (Nov 2015).
Sl
Company Names
Details
Year
Flipkart
Website
No
1
www.flipkart.com
Fashionandyou
www.fashionandyou.
com
21
873
Snapdeal
www.snapdeal.com
within 3 years captured huge share of Indian ecommerce industry. It has numerous product
categories that include books, mobiles, electronic
items, apparels etc. Initially it was started as
discount coupon website but to capture growing
ecommerce market, the company changed its
business model.
4
Myntra
www.myntra.com
Dealsandyou
www.dealsandyou.co
Homeshop18
www.homeshop18.c
om
Yebhi.com
www.yebhi.com
Caratlane
874
www.caratlane.com
Shopclues
as
marketplace
between
seller
www.shopClues.com
and
Tradus
www.tradus.com
Indias e-commerce market was worth about $3.8 billion in 2009, it went up to $12.6 billion
in 2013. In 2013, the e-retail segment was worth US$2.3 billion. According to Google India,
there were 35 million online shoppers in India in 2014 and is expected to cross 100 million
mark by end of year 2016.24
Key drivers in Indian e-commerce are:
Explosive growth of Smartphone users, soon to be world's second largest smartphone user
base.26
Competitive prices and availability of much wider product range compared to what is
available at traditional retailers.
Increased usage of online classified sites, with more consumers buying and selling secondhand goods.
24
http://timesofindia.indiatimes.com/tech/tech-news/Online-shoppers-in-India-to-cross-100-million-by-2016Study/articleshow/45217773.cms
25
http://www.internetworldstats.com/asia/in.htm
26
http://time.com/3611863/india-smartphones/
875
27
http://www.alexa.com/topsites/countries/IN
876
Facebook is trying to solve one of the most annoying problems with online advertisements.
Advertisers just collect data on past behaviour and not future projections. Users are bombarded
with ads for the item; they just bought, despite the fact that the product is already owned by them.
Facebook has a new system that aims to solve this problem that gives users, various options for
dismissing ads they don't like. It appears to have streamlined these options, and added one new very
important choice: Facebook's new prompt "I already own this." So now, if a user keeps getting the
same ad for a product they don't need to buy again, he can let the advertisers know, which solves
the most annoying problems of the user.
Online: The fastest growing ad category
Rising marketing spend in sectors like e-Commerce, telecom, FMCG and consumer durables will help
the online advertising market in India, which is projected to grow at 30 per cent to touch Rs 3,575
crore by March 2015, IAMAI-IMRB28 study said. The overall ad spend in the country across all media
is Rs 38,598 crore as of 2013 with a year-on-year growth rate is 12 per cent, with television
accounting for 44 per cent of the spend.The growth in e-Commerce industry and their ad-spend in
digital media is the highest, contributing close to 20 per cent, followed by telecom and FMCG &
consumer durables. The digital ad spends by the e-Commerce industry has been growing at a CAGR
of 59 per cent since 2011 and stood at Rs 495 crore at the end of March 2014. Currently, search and
display contribute 38 per cent of the overall ad spends, followed by display ads (29 per cent) and
social media (13 per cent).
Online video is now the fastest growing ad category, according to Zenith OptiMedia29, growing 34%
last year to nearly $11 billion. And the agency expects it to grow an average of 29% a year through
2017, when it would top $23 billion. The reason being mobile video consumption is exploding,
thanks partly to larger screens on smartphones and generally faster connections like 4G. There are
also a lot of other Net-connected devices, from tablets to game machines to connected TVs. That
does not mean that the same old television ads will necessarily become the dominant form of
advertising online as well, but it does mean that the classic sight, sound and motion of TV ads
increasingly will drive online advertising as well. It is not just about the visual appeal of online videos
that plant images in the minds of the people, but it is also now about the huge audience size.
28
http://articles.economictimes.indiatimes.com/2014-09-03/news/53522706_1_digital-ad-e-commerceindustry-overall-ad
ZenithOptimedias new Advertising Expenditure Forecasts, EMBARGO: 00.01 BST/01.01 CET Monday 30
March 2015
29
877
Facebooks nearly 1 billion daily active users, Googles huge display ad network includes YouTube,
Yahoo who are hundreds of millions of people, who offer TV like advertising opportunities.
Use of mobile to respond to TV ads
The gradual increase in adaptation of Internet has opened the door to the marketers to go online
and spend on digital advertisement. With mobile devices becoming a predominant mode of Internet
access among the users in India, this number is expected to increase still further. Digital ad spend on
mobile devices stood at 14 per cent, whereas on desktops and laptops at 86 per cent.
Nearly 50% of smartphone owners use their mobile to search for product information after seeing a
TV ad, according to a study from the Internet Advertising Bureau (IAB)30. The survey also found that
38% of respondents used their smartphone in-store while shopping, with 49% of this group using
their mobile to compare prices with other retailers. Research agency GfK interviewed over 800
smartphone owners to track the purchase journey of their most recently purchased product. When
researching the product 78% of respondents used a PC, while 54% used a mobile. Moving onto the
transaction stage, 80% opted to make the purchase on a PC while 34% used a mobile.
Advertisements that cram the newspapers especially during festival seasons have displeased many
readers who look for news. The newspaper will be flooded by ads from e-commerce companies such
as Amazon, Snapdeal and Flipkart, the countrys premier online marketplaces, which were
publicising their special sales for the festival season. E-commerce firms are splurging big time on
promoting their festival sales across media and a significant portion of that money is going into
print.Newspapers are chosen for their credibility. Print ads are seen as being more credible since
they appear in the pages of brands that have been built over the years. The printed word enjoys
greater trust.Besides, a newspaper, with its daily print cycle, stands for immediacy. The ad has
appeared today, so consumers feel they have to buy today. What better vehicle than a newspaper
30
878
then to advertise their short-duration sale. Television, too, has been part of the e-commerce firms'
media plan from the beginning of the year. Revised estimates by the Pitch-Madison report on media
said that e-commerce companies grew their expenditure by 70% in January-June 2015 and a lot of it
went into television. Overall, between January and June, advertising expenditure on television
increased by close to 21% (opposed to the original forecast of 10% growth), led by categories such as
e-commerce, packaged consumer goods, consumer durables, and banking and financial services and
Insurance.
According to AnupriyaAcharya, group chief executive, Zenith Optimedia31, a consumer is in a "leanback" mode while reading a newspaper or watching television. That is because he has set aside a
time for television or newspaper consumption. In a lean-back state, he is more attuned or amenable
to brand awareness or brand messaging.On the other hand, on digital media, a consumer is in a
more "lean-forward" state. While on the laptop or mobile, he is more purposeful and active. He is
either talking on the phone or checking mail, using an app or gaming. This state of mind does not
lend itself well to product or brand awareness.
The advertising swiftfrom online to offline, seems to be working for the shopping portals. Recently,
Mint32 reported that Flipkart claims to have sold one million products and clocked six million visits to
its app in the first 10 hours of the second edition of the Big Billion Days sale. The sale attracted
buyers in Bengaluru, Delhi and Chennai among the metros and Ludhiana, Lucknow and Bhopal
among the non-metros.Snapdeal, too, said that it saw 17 times growth in GMV (gross merchandise
value, or the cost of goods sold on the platform) during its Electronics Monday sale, which had
discounts on smartphones, laptops and other electronics and home appliances.
Conclusion
Despite India being second largest user base in world, the penetration of e-commerce is low.
Flipkart, presently the number one E-Commerce Company in India,is one of India's most-recognised
Internet brands which have a large web presence, but still earns only a small sum from this.
31
Zenithoptimedia.com
http://timesofindia.indiatimes.com/tech/tech-news/Why-e-commerce-firms-advertiseoffline/articleshow/49652872.cms
32
879
Advertising industry should not underestimate the power of online media, which can be used to
reach to the targeted consumers. The consumers have moved online but the advertisers haven't.
Advertising industry should pay serious attention to internet advertisement by understanding the
media and strength of internet. Online media, which is having maximum reach, is not getting the
proper share on the advertising front. E-Commerce marketing should Pay attention to digital
creative output and move with consumers. It is possible to meaningfully communicate brand
through internet.
The advertising swiftfrom online to offline, seems to be working for the shopping portals like Flipkart
and Snapdeal. Newspapers also offer a better shopping environment. The sale ads of the ecommerce brands appear side by side with ads from other retailers promoting their brands.Digital
works best in conjunction with print.
Following are the ways to increase the impact of TV attribution with digital insight.
1. Byusing consistency between online and offline presence for a clear message. It helps interested
consumers to experience TV ads and find advertiser search online, visit websites and apps.
2. By empowering mobile search by including click-to-call and highlighting nearby stores.
3. By understanding consumers keywords search after being exposed to TV ad, offer insights that
can drive faster campaign optimization, saving time and money over traditional surveys or studies.
4. By finding best audiences through demographic targeting with digital insights. Search and site
data reveal who is really responding to TV messages by taking online actions.
Reference:
1. "Online shoppers in
Retrieved 2015-03-25.
2. "Indian e-commerce at inflection point?". Vccircle.com. 2010-08-19.
Retrieved 2013-07-04.
880
5. http://www.iamai.in/media/details/4490#sthash.aaD2QKdG.dpuf
6. http://companiesinindia.net/top-10-ecommerce-companies-in-india.html
7. http://timesofindia.indiatimes.com/tech/tech-news/Online-shoppers-in-Indiato-cross-100-million-by-2016-Study/articleshow/45217773.cms
8. http://www.internetworldstats.com/asia/in.htm
9. http://time.com/3611863/india-smartphones/
10. http://www.alexa.com/topsites/countries;0/IN
11. http://articles.economictimes.indiatimes.com/2014-0903/news/53522706_1_digital-ad-e-commerce-industry-overall-ad
12. http://timesofindia.indiatimes.com/tech/tech-news/Why-e-commerce-firmsadvertise-offline/articleshow/49652872.cms
13. https://econsultancy.com/blog/8859-iab-study-reveals-44-of-those-surveyeduse-mobile-to-respond-to-tv-ads/
881
DR K H ANILKUMAR
ASSOCIATE PROFESSOR AND DEAN
Employee turnover has become the most challenging issue for the organizations as a result of
shortage of skilled labor. Employers try to decrease the turnover rate thereby decreasing the
training costs, recruitment costs and loss of talent and organizational knowledge. Employees
leave the organizations for several reasons such as poor employee employer relations, less
growth opportunities, compensation, rewards and recognition, leadership, welfare benefits,
etc., Retention strategies are very competitive and employers try to retain the best talent of
the organizations. The study attempts to study the various strategies for retention which helps
the organizations improve their performance and productivity.
Key Words:
Turnover, Employee Retention, Welfare Benefits, Compensation, Rewards and
Recognition.
INTRODUCTION
Employee retention refers to the ability of an organization to retain its employees. However
many consider employee retention as relating to the efforts by which employers attempt to
retain employees in their workforce. A distinction should be made between low-performers
and top performers, and efforts to retain employees should be embattled at valuable,
contributing employees. Employee turnover is a sign of deeper issues that have not been
resolved, which may include low employee morale, absence of a clear career path, lack of
recognition, poor employee-manager relationships or many other issues. A lack of satisfaction
and commitment to the organization can also cause an employee to withdraw and begin
looking for other opportunities. Pay does not always occupy a major role in inducing turnover
as is naturally believed.
882
According to Ivancevich and Glueck (1989), employee turnover is the net result of the exit of
some employees and entrance of others to the organization. Singh et al. (1994) also define
staff turnover as the rate of change in the working staffs of a concern during a definite period.
Kossen (1991) defined the staff turnover as the amount of movement in and out (of
employees) in an organization. Loquercio et al. (2006) observed that staff turnover is the
proportion of staff leaving in a given time period but prior to the anticipated end of their
contract. Employee turnover is the rotation of workers around the labor market, between
firms, jobs and occupations,
and between the states of employment and unemployment (Abassi & Hollman,2000).
Employee turnover, as defined by Hom and Griffeth (1994), is voluntary terminations of
members from organizations. Staff turnover that can occur in any organization might be
either voluntary or involuntary. Voluntary turnover refers to termination initiated by
employees while involuntary turnover is the one in which employee has no choice in the
termination as it might be due to long term sickness, death, moving overseas, or employerinitiated termination. (Heneman,1998). A
number of terms have been used for employee turnover, such as quits, attrition, exits,
mobility, migration or succession (Morrell et. al, 2004). It however becomes important to
distinguish between situations where employees leave on their own, and where employees are
asked to leave the organization. There are three fundamental characteristics of turnover viz.
voluntariness, avoidability and functionality (Morrell et al., 2001). Though there are many
causes for employee
turnover in an organization, all of those do not have negative impact on the wellbeing of an
organization. Organizations should differentiate between voluntary and involuntary turnover
and take actions on the one under their control (Loquercio etal., 2006). Voluntary turnovers
are those caused by the employee out of his/ her own choice (e.g. to take job in other
organization for better salary) while involuntary turnovers are because of the decision of
management (e.g. dismissal for gross misconduct). In general, all resignations not formally
883
avoidable and undesirable turnover (Fulmer et al., 2003; Hom et al., 2008; Kacmar et al.,
2006; Michaels et al., 2001). Given the development of new managerial approaches to
retention, labor market dynamism, and evolution in research methodology and technology, it
is not surprising that turnover continues to be a vibrant field of research despite more than
1500 academic studies addressing the topic.
885
It is important to first pinpoint the root cause of the retention issue before implementing a
program to address it. Once identified, a program can be tailored to meet the unique needs of
the organization. A variety of programs exist to help increase employee retention.
Career Development It is important for employees to understand their career path within an
organization to motivate them to remain in the organization to achieve their personal career
goals. Through surveys, discussion and classroom instruction, employees can better
understand their goals for personal development. With these developmental goals in mind,
organizations can - and should - offer tailored career development opportunities to their
employees.
Executive Coaching Executive coaching can be used to build competencies in leaders
within an organization. Coaching can be useful in times of organizational change, to increase
a leaders effectiveness or to encourage managers to implement coaching techniques with
peers and direct reports. The coaching process begins with an assessment of the individuals
strengths and opportunities for improvement. The issues are then prioritized and interventions
are delivered to target key weaknesses. Assistance is then provided to encourage repeated use
of newly acquired skills.
Motivating Across Generations - Todays workforce includes a diverse population of
employees from multiple generations. As each generation holds different expectations for the
workplace, it is important to understand the differences between these generations regarding
motivation and engagement. Managers, especially, must understand how to handle the
differences among their direct reports.
Orientation and Onboarding An employees perception of an organization takes shape
during the first several days on the job and continues throughout their first six months, with
90% of employees still deciding whether or not to stay at the organization during this time. It
is in the best interest of both the employee and the organization to impart knowledge about
the company quickly and effectively to integrate the new employee into the workforce. By
implementing an effective onboarding process, new hire turnover rates will decrease and
productivity will increase.
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RETENTION TOOLS:
Employee Surveys By surveying employees, organizations can gain insight into the
motivation, engagement and satisfaction of their employees. It is important for organizations
to understand the perspective of the employee in order to create programs targeting any
particular issues that may impact employee retention.
Exit Interviews By including exit interviews in the process of employee separation,
organizations can gain valuable insight into the workplace experience. Exit interviews allow
the organization to understand the triggers of the employees desire to leave as well as the
aspects of their work that they enjoyed. The organization can then use this information to
make necessary changes to their company to retain top talent. Exit interviews must, however,
ask the right questions and elicit honest responses from separating employees to be effective.
Employee Retention Consultants An employee retention consultant can assist organizations
in the process of retaining top employees. Consultants can provide expertise on how to best
identify the issues within an organization that are related to turnover. Once identified, a
consultant can suggest programs or organizational changes to address these issues and may
also assist in the implementation of these programs or changes.
simultaneously making sure your expectations are correct are both important factors to
address in the hiring process. High performing employees are more likely to be retained when
they are given realistic job previews. Organizations that attempt to oversell the position or
company are only contributing to their own detriment when employees experience a discord
between the position and what they were initially told. To assess and maintain retention,
employers should mitigate any immediate conflicts of misunderstanding in order to prolong
the employees longevity with the organization. New-hire surveys can help to identify the
breakdowns in trust that occur early on when employees decide that the job was not
necessarily what they envisioned.
Why employees stay- Understanding why employees stay with an organization is equally as
important to understanding why employees choose to leave. Recent studies have suggested
that as employees participate in their professional and community life, they develop a web of
connections and relationships. These relationships prompt employees to become more
embedded in their jobs and by leaving a job; this would severe or rearrange these social
networks. Organizations can ascertain why employees stay by conducting stay interviews
with top performers. A stay survey can help to take the pulse of an organizations current
work environment and its impact on their high performing employees. Employers that are
concerned with over-using stay interviews can achieve the same result by favoring an ongoing dialogue with employees and asking them critical questions pertaining to why they stay
and what their goals are.
Why employees leave- By understanding the reasons behind why employees leave,
organizations can better cater to their existing workforce and influence these decisions in the
future. Oftentimes, it is low satisfaction and commitment that initiates the withdrawal
process, which includes thoughts of quitting in search of more attractive alternatives. If
administered correctly, exit interviews can provide a great resource to why employees leave.
Typically, employees are stock in their responses because they fear being reprimanded or
jeopardizing any potential future reference. The most common reasons for why employees
leave are better pay, better hours and better opportunity. These typical answers for leaving
often signal a much deeper issue that employers should investigate further into. By asking
relevant questions and perhaps utilizing a neutral third party provider to conduct the
interview, employers can obtain more accurate and quantifiable data. Contrary to what most
organizations believe, employees often leave due to relationships with manager and/or
treatment of employees and not compensation, as this is often a response that employees are
uncomfortable expressing to their organization directly. Retention Diagnostic is a rapid
888
benchmarking process that identifies the costs and can help uncover what affects employee
loyalty, performance and engagement.
the company and thus more likely to stay. These practices include shared and individualized
learning experiences, activities that allow people to get to know one another. Such practices
may include providing employees with a role model, mentor or trainer or providing timely
and adequate feedback.
Training and development- Providing ample training and development opportunities can
discourage turnover by keeping employees satisfied and well-positioned for future growth
opportunities. In fact, dissatisfaction with potential career development is one of the top three
reasons employees (35%) often feel inclined to look elsewhere. if employees are not given
opportunities to continually update their skills, they are more likely to leave. Those who
receive more training are less likely to quit than those who receive little or no training.
Employers that fear providing training will make their employees more marketable and thus
increase turnover can offer job specific training, which is less transferable to other contexts.
Additionally, employers can increase retention through development opportunities such as
allowing employees to further their education and reimbursing tuition for employees who
remain with the company for a specified amount of time.
Compensation and rewards- Pay levels and satisfaction are only modest predictors of an
employees decision to leave the organization; however organizations can lead the market
with a strong compensation and reward package. Organizations can explicitly link rewards to
retention (i.e. vacation hours to seniority, offer retention Bonus payments or Employee stock
options, or define benefit plan payouts to years of services) Research has shown that defined
compensation and rewards as associated with longer tenure. Additionally, organizations can
also look to intrinsic rewards such as increased decision-making autonomy.
Effective
Leaders-
An
employees
relationship
with
his/her
immediately
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Employee Engagement- Employees who are satisfied with their jobs, enjoy their work and
the organization, believe their job to be more important, take pride in the company and feel
their contributions are impactful are five times less likely to quit than employees who were
not engaged. Engaged employees give their companies crucial competitive advantages,
including higher productivity and lower employee turnover.
CONCLUSION:
Turnover should be monitored by considering turnover intentions and develop strategies for
retention. Retention strategies should be formulated based on the employees perception
towards turnover intentions. Retention of employees not only improves organisation
performance but also makes the organisation stand in competitive advantage.
References:
Haris Jain, Mary Mathew, Akanksha Bedi. 2012. HRM innovations by Indian and foreign
MNCs operating in India: a survey of HR professionals. The International Journal of Human
Resource Management 1006-1018.
Jyotsna Bhatnagar. 2007. Predictors of Organizational Commitment in India: Strategic HR
roles, Organizational learning capabilities and psychological Empowerment. International
Journal of Human Resource Management 18:10 1782-1811.
Srimannarayana M, 2010. Status of HR Measurement in India. VISION The Journal of
Business Perspective vol.14 No.4.
Supriya Kummamuru, 2014. HR Management Challenges of Indian IT Sector: An
Application of the Viable Systems Model, ASCI Journal of Management 43(2) 1-17
Samson SamGnanakkan 2010. Mediating Role of Organizational Commitment on HR
Practices and Turnover Intention among ICT Professionals, Journal of Management
Resesarch, vol. 10 No.1 pp. 39-61
891
Nagapavan Chintalapati, 2013. Protecting the Competitive Advantage Derived Through HR:
Challenges for IT Industry. The IUP Journal of Management Research, Vol. XII No.3.
Anilkumar Singh, 2009.HRD Practices and Organization Culture In India,The Indian Journal
Of Industrial Relations, Vol.45 No. 2
Vanka Sita, Anitha Pinapati, 2013. Competency Mapping as a Tool of Talent Management: A
Study in Indian IT organizations, Journal of Economic Development, Management, IT,
Finance and Marketing 5(1) 44-56
Canan Ceylan, 2013, Commitment-based HR Practices, different types of innovation
activities and innovation performance, The International Journal Of Human Resource
Management, Vol. 24,No. 1.
Vimala Sanjeevkumar, Wang Wei. 2012. A case study on determinants of human resource
practices influencing retention of employees in Kedah State Development Corporation,
Malaysia. International Journal of Business and Social Research vol.2 No. 2.
Niyati R Patel, Mitsu B Patel. 2014. To study the impact of HR Practices on Employee
retention a case study of L & T Ltd. Indian Journal of Research vol.3 Issue 8.
Yogita Mandhanya, Maitri Shah. 2010. Employer Branding- A tool for Talent Management.
Global Management Review. Vol.4 Issue 2
J. VijayKumar, Navaneetha Kumar, R. Nagarajan. 2012. Retention of Talented Employees in
the IT Sector: A Study With Reference To Industries in Bangalore. Voice of Research vol.1
Issue 2.
Lichia Yiu, Raymond Saner. 2014. Talent Attrition and Retention: Strategic Challenges for
Indian Industries in the next decade. Elite Research Journal of Accounting and Business
Management vol. 2(1) pp. 1-9.
892
I. INTRODUCTION
e-Commerce or electronic commerce, deals with the buying and selling of goods and
services, or the transmitting of funds or data, over an electronic platform, mainly the internet.
These business transactions are categorised into either business-to-business (B2B), businessto-consumer (B2C), consumer-to-consumer (C2C), consumer-to-business (C2B) or the
recently evolved business-to-business-to-consumer (B2B2C). e-Commerce processes are
conducted using applications, such as email, fax, online catalogues and shopping carts,
electronic data interchange (EDI), file transfer protocol and web services and e-newsletters to
subscribers. e-Travel is the most popular form of e-Commerce, followed by e-Tail which
essentially means selling of retail goods on the internet conducted by the B2C category.
According to Ecommerce Europe, country-wise, the US, UK and China together
account for 57% of the worlds total B2C e-Commerce sales in 2013, with China having total
sales of 328.4 billion USD. As against this, India had sales of only 10.7 billion USD, 3.3% of
that of China in 2013 with fifth position in Asia- Pacific. This is despite the fact that India
893
enjoys high demographic dividends just like China. Indias internet penetration with total ehouseholds at 46 million against Chinas 207 million is one of the reasons behind Indias
poor B2C sales growth.
According to Forrester Research, an independent technology and market research
firm, only 16% of Indias total population was online in 2013 and of the online users only
14% or 28 million were online buyers. India, therefore, was still in a nascent or immature
stage of evolution of online retail spending. China was in ascending stage at 50%, whereas
Japan (69%), Australia (57%) and South Korea (70%) were in mature stage. However,
backed by huge discounts and the rising use of smart phones, the Indian e-commerce market
is poised to grow 36% during 2015-20, a new report has said. According to a recent report
from Canada based TechSci Research, expanding smart phone user base, huge discounts and
offers, increasing per capita disposable income and the growing youth population will be the
drivers for the compounded annual growth rate of 36%.
II. GROWTH OF E-COMMERCE IN INDIA
Since the e-Commerce industry is fast rising, changes can be seen over a year. The
sector in India has grown by 34% (CAGR) since 2009 to touch 16.4 billion USD in 2014.
The sector is expected to be in the range of 22 billion USD in 2015.
Currently, e-Travel comprises 70% of the total e-Commerce market. e-Tailing, which
comprises of online retail and online marketplaces, has become the fastest-growing segment
in the larger market having grown at a CAGR of around 56% over 2009-2014. The size of the
e-Tail market is pegged at 6 billion USD in 2015. Books, apparel and accessories and
electronics are the largest selling products through e-Tailing, constituting around 80% of
product distribution. The increasing use of smart phones, tablets and internet broadband and
3G has led to developing a strong consumer base likely to increase further. This, combined
with a larger number of homegrown e-Tail companies with their innovative business models
has led to a robust e-Tail market in India rearing to expand at high speed.
A significantly low (19%) but fast-growing internet population of 243 million in 2014
is an indicator of the sectors huge growth potential in India. It is evident that in absolute
terms Indias internet users are short by only 36 million as compared with 279 million in the
US and higher than that in Japan, Brazil and Russia. However, in relation with its population,
only 19% Indians use the internet. This indicates the potential of internet use in India and as
internet penetration increases, the potential of growth for the e-Commerce industry will also
increase.
894
An analysis of the demographic profile of internet users further testifies that eCommerce will rise rapidly in India in coming years. Around 75% of Indian internet users are
in the age group of 15 to 34 years. This category shops more than the remaining population.
Peer pressure, rising aspirations with career growth, fashion and trends encourage this
segment to shop more than any other category and India, therefore, clearly enjoys a
demographic dividend that favours the growth of e-Commerce. In coming years, as internet
presence increases in rural areas, rural India will yield more e-Commerce business.
By 2020, e-Tail in India is expected to account for 3% of total retail. Further, orders
per million are expected to more than double from five million in 2013 to 12 million by 2016,
which will mean more opportunities for both consumers and e-Tail companies. While the
share of online shopping in total retail has increased at a fast pace in the last few years, it is
still miniscule compared to the figure in China, where the share is 8-10%.
III. CONSTRAINTS OF E-COMMERCE GROWTH IN INDIA
Certain e-Commerce players and industry observers have raised concerns that deep
discounts, free shipping, intense competition and higher rejection rates due to cash on
delivery (CoD) have impacted online e-Tailing adversely. Some of these concerns are
specific to India and are more difficult to overcome than issues such as internet penetration
and getting more people to shop online. Some of the key concerns are listed below:
label
Last-mile delivery:
Poor last-mile connectivity, especially in remote areas with larger population, is
another
Low profitability:
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Regulatory barriers:
Regulatory barriers in the Indian e-Commerce market are higher as compared to more
mature markets.
where people have limited access to brands but have high aspirations. According to eCommerce companies, these cities have seen a 30% to 50% rise in transactions.
aggressive
advertisements. The free and quick shipment and wider choice of products,
along with
e-
social media, particularly Facebook, are playing a proactive role in promoting e-Tailing
through
Tailers
brands. For
Perkins,
River Island, Blue saint and Miss Selfridge, along with local fashion brands
through
brands such
and
has
also been in great demand among customers outside India. Export comprises 95% of
cross-border e-Commerce, with the US, UK, Australia, Canada and Germany being
the
major markets.
phones
are increasingly replacing PCs for online shopping. In 2013, only 10% of the
mobile
users used Smart phones, and only 5% of the e-Commerce transactions were
made through a mobile device. This figure has more than doubled, and more than 13% of all
e-
Commerce transactions today happen via mobile. Over 50% of the orders are being
placed through mobile apps, which is not only leading to substantial customer
acquisition
but also building customer loyalty for various brands. However, most mobile
transactions
so far are for entertainment, such as booking movie tickets and music
downloads. This
trend will change soon with more and more merchandise being ordered
online.
V. CONCLUSION
The Winning Leap, emergence of new technologies, especially mobile, in India has
sparked a social change. While mobile, internet, and social media penetration and growth can
be quantified; describing the changes in social values and lifestyles that have accompanied
those trends is far more challenging.
A key outcome of the technology revolution in India has been connectivity, which has
fuelled unprecedented access to information. Millions of people who had little means to join
the national discourse can now gain new insights into the world around them. Farmers know
crop prices. Consumers understand global standards of product and service quality. Rural
Indians recognise the differences between the opportunities available to them and those
available to their urban counterparts. And citizens have a mass forum for expressing their
political opinions. The upshot of this connectivity revolution has been empowerment of
Indians
REFERENCES
1. Indias Internet Matchmakers See Potential Boom, Internet evolution website,
www.internetevolution.com/author.asp?section_id=687&doc_id=160162, accessed 1
897
November 2011; The business of online matrimonial sites in India, Article base
website, www.articlesbase.com/marriage-articles/the-business-of-online-matrimonialsites-in-india-5242118.html, accessed 1 November 2011;
2. Matrimonial portals: tradition and technology are a perfect match for those looking
online,
India
Knowledge
@Wharton
website,
www.knowledge.wharton.upenn.edu/india/article.cfm?articleid=4331,
accessed
November 2011.
3. Where
cyber
evolution
meets
`rojgaar,
The
Hindu
website,
Indian
e-commerce
really
arrived?,
Globalpost
website,
898
I BHARAT MAHAN
PROF. JACOB CHANDY
IBS BANGALORE
The status that now matters is not whether you are awake or asleep, but whether you are
online or offline. The most fundamental debate for our youth is the choice between Android,
IOS or Windows.
Prime Minister Narendra Modi
at the Digital India Meet, San Jose, California, USA, September 27, 2015
41.1 BACKGROUND NOTE
The internet has changed the way we work, socialize and share information. The internet
drives worldwide commerce and has become a factor that determines GDP. In India, the
internet will become the driving force of economic development as it is well on the way to
becoming universally accessible and affordable to the common man. The dream of iBharat, is
driven by none other than its internet savvy Prime Minister, through the Digital India
Program under the Department of Electronics and Information Technology (DeitY). The
Digital India vision of e-Governance is unparalleled anywhere else in the world and has the
potential to alter the course of Indias destiny.
There are 1.2 billion Indians and India is one of the worlds youngest nations with 52% of its
population below 25 years of age. Indians own 975 million mobile phones and has an online
population that exceeds 350million. These numbers are likely to see manifold increases
especially because of its young population. Moreover, almost every internet based initiative
has been eagerly embraced by the Indian population who are fed up of dealing with
bureaucracy. Obvious examples of such successful internet based initiatives are the Indian
Railways Online Ticketing System and Internet Banking.
Digital India plans to create a knowledge based digital economy and has received wide
support from all over the world. Pledges of support in terms of hard cash and technology
have come from Indian industry as well as from international giants such as Microsoft,
Google and FaceBook.
41.2 ABOUT DIGITAL INDIA
Digital India is fundamentally a program by the Government of India to provide government
services via the internet and was launched on 1-Jul-2015 by Prime Minister Narendra Modi.
The plan has three core components:
899
Geographical
information
systems
for
decision
making
and
development
3. Digitally empowered population
The program will be monitored by the Digital India Advisory Group chaired by the Minister
of Communications and Information Technology. The vastness of its scope means that this
will perforce be an inter-ministerial effort where every ministry such as healthcare, education,
judicial services, etc. will offer its services to the public through the internet.
41.3 DIGITAL INDIA PILLARS
To realize its goals the program envisages nine pillars:
1. Broadband highways
2. Universal mobile access
3. Universal internet access
4. e-Governance
5. eKranti - electronic services delivery
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901
Cloud by default
Mobile first
Language localization
o Farmers will have online real time price information, agricultural inputs, cash,
loans, and entitlements along with mobile banking.
Messaging platform
o This is a messaging application covers all elected representatives and all
government employees, a total of 1.36 crore mobiles and 22 lakh emails.
Government e-Greetings
o The e-Greetings portal crowd sources designs for designs for Independence
Day, Teachers Day, Gandhi Jayanti, etc. and all government greetings will be
e-greetings henceforth.
Biometric attendance
o A biometric attendance portal will monitor attendance of government
employees.
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41.4.1 Digilocker
This service was started in February 2015 and provides secure personal digital storage linked
to the citizens Aadhaar Number. A maximum of 1GB is provided free of charge. It is
expected that this facility when associated with the eSign service will eliminate paper
documents thereby reducing the cost of government services.
41.4.2 MyGov.in
This portal is designed so that people can contribute to governance by giving online
suggestions to the government. Any kind of file can be uploaded by the user and there is also
a plan to develop a MyGov Mobile App to widen the impact.
41.4.3 Swachh Bharat Mission App
This app allows you to report civic problems to the Prime Minister himself. The app was
developed and launched in support of the Prime Ministers Swachh Bharat Mission by an
ordinary citizen named Mahek Shah. The app enables users to click a photograph,
automatically locate the position using Google Maps and send it to the Prime Ministers
office using Twitter. The app also provides updates on the Swachh Bharat Mission. The app
boasts of around 5000 active users.
41.4.4 Center of Excellence for Internet of things
The center is located in Bangalore to facilitate adoption of IoT technology and develop
competitive advantage in this technology. It is a joint venture between National Association
of Software and Services Companies, Department of Electronics & Information Technology
and Education and Research Network.
41.4.5 eHospital
This facility provides online medical services such as registrations, appointments, payments,
diagnostic reports and blood availability checking so that hospitals can be relieved of the rush
of humanity. Several prominent hospitals such as All India Institute of Medical Sciences,
Ram Manohar Lohia Hospital, National Institute of Mental Health and Neuro Sciences and
Sports Injury Centre have already implemented the system. Eventually all hospitals will be
enrolled.
41.4.6 Wi-Fi Hotspots
Facebook has set up 100 Wi-Fi hotspot villages in partnership with BSNL to further its goal
of connecting the next billion users. These Wi-Fi hotspots allow 2000 users at a time. BSNL
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by itself has installed 450 hotspots in tourist locations and its goal is to install 2500 hotspots
by 2016.
41.4.7 National Scholarship Portal
The government provides financial assistance to students but accessing these scholarships
was difficult because of the bureaucracy involved. The National Scholarship Portal addresses
this problem by automating the scholarship workflow and delivering funds directly to the
students bank account.
41.4.8 Center for Flexible Electronics
The center will do R&D in the area of flexible electronics to develop a domestic industry
under the 'Make In India' initiative. The center will focus on organic solar cells, disposable
sensors, smart cables, flexible displays and lighting.
41.4.9 Digitize India Platform
Millions have been spent by governments to digitizing government records and the process
has proved inefficient and inadequate. Vast quantities of government documents remain to be
digitized. Even in cases where digitization has been done, such digitization has been by
merely scanning the documents which prevents them from being searched, which by itself
negates the idea of open government data. Digital India, in an innovative move, will crowd
source the digitization process through the Digitize India Platform. Scanned images can be
submitted to the platform which will then shred them into snippets of meaningful data.
Anybody with an Aadhaar Number can enroll as a contributor on the platform and be served
with random snippets which he can convert into data. The contributor will be paid for his
work after the converted data is matched in the matching engine. The original document is
then automatically reassembled from the random snippets which have now been converted
into data in an imaginative Pixel to Data crowd sourced transformation.
41.4.10eSign
eSign allows Aadhaar Number holder to digitally sign any document. The Aadhar e-KYC
service authenticates the user and issues a digital signature certificate from a Certifying
Authority that uses public key encryption for the eSign.
41.4.11BharatNet
BharatNet is a nationwide 20 Mbps broadband network to be rolled out by Bharat Broadband
Network Limited using the National Optical Fiber Network and satellite media.
906
907
MS. P.V.CHANDRIKA
RESEARCH SCHOLAR, VELLORE INSTITUTE OF TECHNOLOGY, VELLORE, TN
MR. SURESH SAMADHI
ASST. PROFESSOR, GEETHANJALI INSTITUTE OF PG STUDIES, NELLORE, AP
ABSTRACT
Public Sector Undertakings play a predominant role in every state economy. PSUs determine the
economic, social and financial status of every state economy. There are around 251 state Public
sector undertakings in India. Andhra Pradesh has 42 State PSUs. Out of 42, 39 are operating well.
APSFC is a term lending institution established in 1956. This is merging of Andhra state finance
corporation and Hyderabad state finance corporation. The main objective of this corporation is to
promote financial assistance to the small and Medium Scale Industries (SMEs). This is an integral
part of development financing industry in country where contributed more for the development of
industries in Andhra Pradesh. The paper studies the role played by APSFC in promoting SMEs,
Financial performance of SMEs in the last 10 years, sanctioning of loans and disbursements for
SMEs, key performance factors of the corporation, impact of leverage on shareholders fund,
recovery performance. To analyze these objectives the financial report of last 10 years are
considered. At the end of the study analysis, interpretation and some suggestions are given in this
research paper.
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________________________________________________________________________
INTRODUCTION
Andhra Pradesh State Finance Corporation (APSFC) came in as a Financial Institution on November 1,
1956 with the avowed objectives of providing financial assistance and managerial support to
industrial entrepreneurs in Andhra Pradesh. APSFC concentrated main on the industrial growth in all
the categories of the economy. The overall progress of this is marked with various constraints.
Hence there is a need to strengthen the financial performance of the APSFC along with operational
activities are also examined.
This research paper studies the financial performance and sanctions, disbursements and recovery
performance of the corporation.
909
REVIEW OF LITERATURE
Vishwanath Reddy (2013) in his research paper - Operational and Financial Performance of Andhra
Pradesh State Financial Corporation suggested that corporation should need to strengthen its
financial base to serve better the industrial sector, ensure timely recovery over its dues.
Reddy (2012) in his paper Industrial Financial Services A Study highlighted the relationship
between sanctions and disbursements, gross sanctions and sanctions granted to the SSI sector - by
APSFC purpose wise, constitution wise, loan type wise, social class wise, region wise,
classification of assistance and some suggestions were given on the overall performance of the
corporation.
Bhat (2012) in article Financial statement Analysis of Andhra Pradesh State Financial Corporation
analyzed the operational and financial performance of APSFC, and suggested that the corporation
has to reduce the operating expenses to improve the profitability and should frame a good credit
policy to speed upon the collection period.
Athma and Lakshmi (2012) APSFC: Performance since inception made an attempt to examine the
trends in the performance of APSFC since inception and analyzed the purpose wise, constitution
wise, loan type wise and industry wise sanctions and disbursements of loans and found that there
has substantial improvement in APSFC.
Garg and Gupta (2011) :State Financial Corporations and Industrial developments (A case study of
PFC and HFC) evaluated the role played by SFCs in development of industries in states of Punjab and
Haryana.
910
Rani and Rao (2010) Development Financial Institutions In India: Changing Role and Strategies
pointed out the role and operation and operational performance of development financial
institutions in economic development.
Alivelu. Srinivasulu and Reddy (2009) article State Business and Performance of the
Manufacturing Sector in Andhra Pradesh A Case Study attempted and established a relationship
between state business relations and industrial development in general and the expansion of
financial institution APSFC in the state of AP.
Andhra Pradesh being one of the fastest developing industrial states has plenty of resources for
establishment of small, medium Scale industries. APSFC which started in 1956 November 1 has been
functioning through its 25 branch offices, 2 field offices ad 6 Zonal offices. It has its head office
located in Hyderabad. The Present Study entitled Financial Performance of Andhra Pradesh State
Financial Corporation (APSFC) is an attempt to evaluate the financial performance of the APSFC for
the last 10 years along with different financial parameters are evaluated.
RESEARCH METHODOLOGY
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Research Design:
The study is exploratory research that lays emphasis on analysis and interpretation of
financial statements.
Sources of Data:
The study is based on secondary data which consisted of annual reports for the period of 10
years i.e., 2004-05 to 2013-2014. The data is also collected from
journals, magazines, published books and websites of the corporation.
Tools of Analysis:
The statistical tools applied for data analysis and to arrive at the accurate conclusions are
percentages, Simple growth rate, compound annual Growth Rate, Mean Variance, standard
deviation, correlation and t-test.
HYPOTHESIS:
H0: There is no significant variation between sanctions and disbursements over the period of
study.
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H1: There is no significant variation between gross sanctions and sanctions to small scale sector.
The performance of APSFC in terms of its assistance to the industrial units in Andhra Pradesh by
considering the following parameters.
Gross
Annual
Sanctions
Rate (%)
Rate (%)
913
Growth
2004-05
1273
1192(93.63)
676.48
464.69(68.69)
2005-06
1226
1150(93.80)
729.92
585.96(80.27)
2006-07
1287
1200(93.24)
930.33
704.75(75.75)
2007-08
1373
1231(89.66)
1186.32
1006.65(84.85)
2008-09
1458
1262(86.55)
1442.30
885.66(61.40)
2009-10
1328
1177(88.62)
1400.09
1052.38(75.16)
2010-11
1492
1412(94.63)
1668.17
1386.38(83.10)
2011-12
1359
1259(92.64)
1368.81
936.89(68.44)
2012-13
1504
1434(95.37)
1315.33
882.76(67.11)
2013-14
1429
1420(99.37)
1430.11
951.41(66.52)
Mean %
92.71
73.12
The relating to gross application sanctioned was taken as the percentage of application dealt with as
inception on March 31st of every year. Table 1 provides an opportunity of assessment of functioning
of the corporation. The number of applications approved and assistance sanctioned by the
corporation on an average is 92.71%. Around 7% of the applications were rejected or pending. The
graphical representation of the Table 1. There is a drastic fall in the year 2008-09 of 61.40 and again
regained in the year 2010-11 and completely in the falling trend. This shows that this has fluctuating
trend.
914
200
150
100
Gross applications
sanctioned as % to dealt
50
0
5
6
7
8
9
1
2
3
4
0
-0
-0
-0
-0
-0
-1
-1
-1
-1
01
4
5
6
7
8
0
1
2
3
2
0
0
0
0
0
1
1
1
1
20
20
20
20
20 009
20
20
20
20
2
Gross
Annual
Disbursement
Annual
Percent %
sanctions
Growth Rate
2004-05
464.69
--
348.87
--
75.07
2005-06
585.96
26.09
421.72
4.65
71.97
2006-07
704.75
20.27
523.13
16.27
74.22
2007-08
1006.65
42.83
662.69
12.07
65.83
2008-09
885.66
-12.01
685.69
10.77
77.42
2009-10
1052.38
18.82
707.98
21.48
67.27
2010-11
1386.38
31.73
904.35
81.07
65.23
2011-12
1368.81
-1.26
936.90
3.59
68.44
Growth Rate
915
2012-13
1430.11
4.47
951.41
1.54
66.52
2013-14
1315.33
-8.02
882.76
-7.21
67.11
Mean
10200.7
No.
of 10
70254.9
10
10
10
Observations
Correlation
0.992
coefficient
t-statistic
Degrees
7.155
of 9
freedom
Source: Annual Report of APSFC (2004-05 to 2013-14)
916
Highest sanctions were recorded in the year 2012-13 and the amount disbursed is also more in the
same period. But it eventually falls down for the next year. As the t- critical value is greater than the
calculated value, null hypothesis is accepted. Thus there is a close association between the gross
sanctions and disbursements. The graph shows there is no such period where number of sanctions is
equal to the number of disbursement.
Gross sanctions
Sanctions to SSI
Percent %
2004-05
464.69
272.80
58.71
2005-06
585.96
285.50
48.72
2006-07
704.75
331.96
47.10
2007-08
1006.65
372.03
36.95
2008-09
885.66
412.10
46.53
2009-10
1052.38
500.62
47.57
2010-11
1386.38
906.49
65.38
2011-12
1368.81
966.02
70.57
2012-13
1430.11
975.07
68.18
2013-14
1315.33
883.52
67.70
Mean
10200.7
59061.62
917
No. of Observations
10
Correlation coefficient
0.940
t-statistic
10.290
Degrees of freedom
10
10
The highest percent of sanctions for small scale industries is recorded in the year 2011-12 and low in
the period 2007-08. After the year 2011-12 the sanctions to small scale industries is showing decline.
As the calculated value is higher than the tabulated value null hypothesis is rejected. Therefore there
is no close association between gross sanctions and sanctions given to the Small Scale Industries.
Recovery Performance:
Recovery of funds among the industrial units is one of the key components to evaluate the
operational performance of the APSFC. Table 4 gives the recovery performance during the period of
918
study. The recovery performance of the industry is calculated by taking principal amount paid along
with the interest annually. The percentage of recovery every annually is shown in the following
table.
Principal
Annual
Interest
Growth Rate
(%)
2004-05
331.10
--
120.28
--
451.39
2005-06
352.19
6.36
129.95
8.03
482.14
2006-07
371.18
5.39
144.77
11.40
515.95
2007-08
421.72
13.61
200.22
38.30
621.93
2008-09
449.25
6.52
208.83
4.30
658.08
2009-10
528.04
17.53
257.08
23.10
785.12
2010-11
614.48
16.36
287.89
11.98
902.38
2011-12
636.13
3.52
330.33
14.74
966.46
2012-13
619.31
2.64
369.67
11.90
988.98
2013-14
626.25
1.12
386.54
4.56
1012.79
Mean %
26.95
14.25
919
Only 26.97 % of the principal is being recovered on an average and 14.25% is only recovered through
interest that means only 41.2% is recovery performance and rest 58.8% (Principal + interest) is
unrecoverable. The above table shows that the recovery performance of the corporation need to be
improved as it indicates only 26.95% of principal recovery and 14.25% of interest recovery annually.
The amount of recovery is improving every year.
Operating Profit
Net Profit
2004-05
6.90
13.15
2005-06
7.83
24.58
920
2006-07
8.15
27.21
2007-08
15.00
89.51
2008-09
44.58
42.85
2009-10
99.65
67.67
2010-11
100.28
67.33
2011-12
112.12
68.32
2012-13
980.95
63.35
2013-14
935.78
34.14
In the above graph operating profit is the profit earned from firms normal business and this doesnot
include any profits earned from the firms investment and the effects of interest and taxes. Net profit
921
is the profit earned apart from operating profit. It shows high profits in the year 2007-08 and
eventually decreased by 2013-14. Highest profits were recorded in the year 2012-13 i.e., 2012-13.
Conclusions:
1. There should be proper allocation and disbursements of loans. Sanctions were 100% but the
disbursement was 70% rest 30% is not disbursed to the any industries.
2. Recoveries are to be properly maintained.
3. There should be proper allocation of loans for the development of SSI
4. A sound resource mobilization policy is to be maintained.
5. To improve the recovery performance corporation should make a thorough review on the
industries.
6. Recovery performance of the corporation is only 41.2% rest 58.8% is unrecovered.
7. The flow of credit to Small Scale Industries is 100% through sanctions but the disbursements
constituted only 50% that is the rest 50% is not disbursed for small scale industries but for
the other categorical industries.
8. The profits of the corporation are to be increased.
Further research can be made in studying the leverage on share holders profitability, Resource
mobilization, clients perception on financial services by APSFC.
REFERENCES
1. Vishwanath Reddy (2013) in his research paper - Operational and Financial Performance of
Andhra Pradesh State Financial Corporation Indian journal of Finance P.No: 5 -14
2. Bhat (2012) in article Financial statement Analysis of Andhra Pradesh State Financial
Corporation analyzed the operational and financial performance of APSFC, P.No:10-15.
922
923
Abstract:
Determinants of Dividend Distribution are one of the hotly debated topics in corporate
finance. In this research paper top 4 Information Technology (IT) companies in India are
analysed over a span of 5 financial years. Three factors namely Leverage, PE Ratio, and
Return on Equity are found to be statistically significant, as far as Dividend Distribution
Decisions are concerned. This is a significant addition to the theory on Determinants of
Dividend Distribution, especially in the Indian context.
Key Words: Dividend Distribution, Leverage, PE Ratio, Return on Equity
JEL Classification: G35
Introduction:
Distribution of profit to shareholders is termed as dividend(Pandey, 2004). Profit earned by
companies can be retained by them for future usage, or can be returned to shareholders as
dividends. Each business organization, has their own unique circumstances to take a very
strategic decision with regards to the money generated through profit, i.e. whether to keep
retain it or to return it to the shareholders. A number of conflicting theories have also been
developed with respect to this (Alkuwari, 2009).The pertinent in this respect to note that
The harder we look at the dividend picture the more it seems like a puzzle, with pieces that
just do not fit together (Black 1976). There are different theories on dividend payment, and
they deal with whether dividend payment increases or decreases the valuation of the
company. It is not difficult to identify the variables which affect the dividend payment
decisions, however, what is difficult to determine is how these factors interact among
themselves (Ross, 2009).
924
Most of the existing researches have focussed on developed Western Europe and the
Northern American regions. Whereas emerging economies as a whole attracted very little
attention in this respect (Musiega et al, 2013).
Models developed in the western world, may or may not be applicable to emerging markets,
due to their unique social as well as corporate culture, regulations and nature of
investors(Musiega et al, 2013).Decisions to pay dividend and its impact on valuation of
shares, is also widely debated in the literature of corporate finance, one set of argument put
forth says that, dividend payment and increase in its amount, increases the valuation of the
firm, whereas another line of argument says that, it decreases the valuation of the firm, still
there are other researchers who think, dividend payment decisions have no impact on the
valuation of the shares (Anupam, 2012). Modigliani and Miller (1961) proposed that dividend
payment decisions are irrelevant from the equity valuation perspective.
Dividend payment decisions are signals to the investors regarding, what the incumbent
management thinks about the future of the company. According to Bishop et al(2000),
profits earned can be ploughed back into the business or kept by the management for
investment for capital expenditure in future projects. In taking these decisions, what is
pertinent to consider is not only how much money is needed for fresh capital expenditure ,
but also, what effect the capital expenditure will have on the share price of the company, thus
affecting wealth of the shareholders of the company. Also firms should not drastically
change, their dividend pay-out ratio, as it will impact the planned future investments
(Abdullahi,2011).
India Information Technology Sector:
InformationTechnologysector in India is one of the few areas where India became globally
competitive. According to a report prepared by India Brand Equity Foundation (IBEF), India
approximately counts for sixty seven per-cents of the global outsourcing market of US$ 130
billion.According to the industry body NASSCOM (National Association of Software and
Services Companies) data, the industry grew at a Compounded Annual Growth Rate (CAGR)
of fifteen per-cents between 2010 and 2015.
Literature Review:
925
Krishman (1963) propagated a bird in the hand theory, regarding dividend distribution.
According to this theory investors are risk averse by their very nature.Linter(1962), Gordon
and Shapiro (1956) got support for this theory, through their research. The underlying logic
for this behaviour was that returns from the equity market is uncertain, also there is
considerable information asymmetry in the system, as a result, investors will like dividend
payment, as it transfers money from the company to the investors.
On the other hand Agency Theory, propagated by Jensen(1986), argues thatthe dividend
payment restricts the fund available to managers, as far as investment in new projects is
concerned.
Lintner (1956) focussed on the behavioural side of the policy regarding Dividend Payment
Decisions. He concluded that the managers take the decisions to increase the proportion of
Dividend Payment, only when they are certain that the firms earnings have increased
permanently. Brittain(1966) studied the Dividend Payment Policy and tax structure, over a
long period (1919-1960) of time and concluded that, the principal determinant of Dividend
Payment Policy decisions are Cash Flow of firms, and not the Net Profit figure. On the other
hand Fama and Babiak (1968), concluded that Net Profit is a better determinant of Dividend
Payment, than either the Cash Flow figures or the Net Profit and the Depreciation figures are
taken separately, they reached this conclusion, on the basis of data analysed of 392 major
firms, on a timeframe of 1946 to 1964.
In the Indian context, there are certain studies, in this regard. For example, Rao and
Sarma(1971) concluded that Lintner model can explain the Dividend Payment Decisions, in
industries such as coal mining, sugar, jute textiles, chemical, and cement industries.
Bhattacharya (1979)was of the view that bird in hand hypothesis is not proper. Moreover, it
was further suggested, that the firms level of risk assumption affects the level of dividend.
Bhat and Pandey(1994) found support of Lintners model in the Indian context, which proved
that Indian managers increased the level of dividend, only when they became absolutely
certain about the permanent nature of the increase in profitability.
Mishra and Narender (1996)tested the Lintners model of Dividend Payment on Public Sector
Units (PSUs) in India. The study concluded that, the number of Dividend Paying PSUs
compared to the total number of PSUs is quite small. The study also came to the conclusion
that, the Dividend Payment Ratio (DPR), remain constant for most of the companies, even if
the Earning per Share(EPS) figure shows a constant improvement. On the other hand Saxena
926
(1999) found that, past revenue growth rate, future earnings forecast, how many shareholders
a company has, and systematic risk act as the Determinants of Dividend Pay-out Policy.
Research Methodology:
Variables Used:
In this research endeavour Dividend Pay-out Ratio of the firm is taken as the dependent
variable, whereas Size, Profitability, Risk, Leverage, and Liquidity of the firm are taken as
the independent variables.
The Size of the firm is computedas the natural logarithm of the book value of the firms Total
Assets. This method is in accordance with Joseph (2001).
Profitability of the firm is measured by three parameters, i.e. Return on Equity(ROE), Return
on Assets(ROA), Earnings per Share(EPS).
927
Profitability, Risk, Leverage, and Liquidity are taken in accordance to the method adapted by
Mehta(2012).
Data Used:
The source of the data for this research has been Capital Market and Securities Exchange
Board of India (SEBI) databases. The companies are chosen from the Cement sector in India.
The period of the study, which is taken into account is five years period starting from 1st.
January, 2010 to 31st. December, 2014. The companies which have not paid continuous
dividend in this periodare excluded. The companies with the Government ownership,
financial institutions/companies are also excluded. The sample selection framework is in
accordance to Gupta and Banga (2010). In total 8 top listedITcompanies are taken into
account. These 8 companies are the IT companies listed in Capital Market database as Large
Computer Software companies. The companies considered for analysis in this study are TCS
Ltd., Infosys Ltd., Wipro Ltd., and HCL Technologies Ltd.
Empirical Results:
The step wise regression model, used here, gradually removed the insignificant predictors one
by one. The final model, with three predictors namely PE Ratio, LEV, and ROE can explain
928
50.7% of the variations in the Dividend Payment decisions. This is quite an improvement
over 20.7% explaining capability of the initial model, as depicted by the R-Square values.
The fitted regression equation is
DPR = 0.314 + 1.954[PE Ratio] + 3.602[LEV] +5.065[ROE]
All the three predictors namely, PE Ratio, LEV, and ROE are statistically significant, even at
5% level. All the three factors have positive influence on the dependent variable (DPR).
Conclusions:
Firms with higher PE Ratio are high growth firms, so it is natural that these firms pay higher
dividend. Similarly higher Leverage for firm, results in higher portion of the profit is left for
the equity holders. So it is no wonder that, firms with higher Leverage have higher DPR.
ROE is intrinsically related, to return of the equity holders, so higher ROE results in higher
DPR. These findings are in line with the existing literature. This study was done on a period,
when Indian equity markets saw some of the exciting phases, and touched new all-time high.
This research covered the 4 biggest ITservices companies in India.This should be an
important addition to the existing literature on Dividend Payment decisions, especially in the
context of the Indian capital market.
References:
Al-Twaijry, A.A. (2007).Dividend policy and Payout Ratio: Evidence from the Kuala
Lumpur Stock Exchange. The Journal of Risk Finance, Vol. 8, No. 4, pp. 349-363.
Al-Kuwari, D. (2009).Determinants of the Dividend Payout Ratio of Companies Listed on
Emerging Stock Exchanges: The Case of the Gulf Cooperation Council (GCC) Countries.
Global Economy & Finance Journal,Vol. 2, No. 2, pp. 38-63.
929
930
Annexure
The eight companies are:
1. HCL Technologies
2. Infosys
3. MphasiS
4. Oracle Financial Services
5. Polaris Financial
6. TCS
7. Tech Mahindra
8. Wipro
931
932
The term sports memorabilia usually refers to a souvenir, memento, keepsake or token of
remembrance that is directly connected to a famous athlete, sporting event or personality. For
example Photos, trading cards, jerseys, helmets, balls, bats, or related sports equipment that
have been signed by sports persons. These items are generally collected by fans that find
sentimental and monetary value of the items. Sports Memorabilia market is a multibilliondollar global market in present days. However, it is troubled with vulnerabilities, due to the
large percentage of counterfeit memorabilia items. According to the Federal Bureau of
Investigation, it is estimated that around 90% of sports collectibles are counterfeit & which is
accounting $500,000,000 in losses annually.
This paper theoretically investigates the growth of sports memorabilia market with its
inherited problems. It also examines the prospects for Radio Frequency Identification (RFID)
to be used to provide a protection for pieces of sports memorabilia from the point the item
is signed through all subsequent transfers. The article explains the implications of RFID
technology into this fragmented marketplace and the benefits for all parties involved in sports
collectibles.
Introduction:
933
The term sports memorabilia usually refers to a souvenir, memento, keepsake or token of
remembrance that is directly connected to a famous athlete, sporting event or personality. For
example Photos, trading cards, jerseys, helmets, balls, bats, or related sports equipment that
have been signed by sports persons. These items are generally collected by fans that find
sentimental and monetary value of the items. Sports Memorabilia market is a multibilliondollar global market in present days. Present size of Global Sports Memorabilia Market is $5
billion, out of which $1 billion is contributed by U.S alone.
However, it is troubled with vulnerabilities, due to the large percentage of counterfeit
memorabilia items. Long term Memorabilia collector says that over the last decade the
market for genuine vintage memorabilia has changed drastically. In the late 1980s very
limited genuine vintage pieces like vintage balls, checks, old books, letters, and the rare cuts
were exclusively traded among the selected group of investors through a well-defined
network. But later market was swamped with thousands of fake articles including bats, balls,
jerseys, helmets, pictures, magazines, pieces of papers, posters, lithographs, record albums,
and other items. At present most of the Memorabilia items are comprised of forgeries. These
items were sold by the retail dealers. Counterfeit market is blossoming because of the role
played by authenticators who fraudulently certify forgeries as genuine signatures & most of
the middlemen are engaged in these activities.
According to the Federal Bureau of Investigation, it is estimated that around 90% of sports
collectibles are counterfeit & which is accounting $500,000,000 in losses annually. Market
analyst Havoscope (2008) has concluded that over half of the sports memorabilia market is
comprised of counterfeit items. Counterfeit of sport memorabilia items are boosting in the
economy as these are sold in various venues including physical and online stores, shows and
auctions, private sales etc. Forgeries have increased considerably with the introduction of
eBay & other online auction houses. The easy access & widened marketplace has increased
the online memorabilia sales. One can see proof of this by striking any well-known players
name on eBay, or other online auction sites & can find thousands of autographed items for
sale.
Sports Memorabilia Market:
History:
Collecting sports memorabilia was first considered in the late 19th Century as part of a
perceptive corporate marketing strategy to sell tobacco products. In late 1880s tobacco
934
companies came up with innovative advertising strategy & mass production allowed them to
insert baseball cards into all the products from tobacco to soap. Between 1887 and 1890,
Goodwin and Co. of New York produced the first true series of baseball cards, several
hundred which featured sepia toned photographs of baseball players. By 1910, around 75
verities of baseball series were issued. By recognizing the opportunities in this market, in
1930s, bubble gum companies have inserted the collectible cards into the chewing gun
packets. From the beginning of II World War, manufacturing ceased till 1950. Again in 1952,
Topps was the first company to place the players image, team logo, vital information and upto-date statistics on the cards. In post-war 1950s, signed sporting equipment became popular
Market Structure:
The terms Memorabilia & Collectibles are used interchangeably used in most of the instants
but the recent publication of, A Comprehensive Guide to Collecting Sports Memorabilia
states that the articles which are signed by sportsperson & authenticated by reputed dealer are
considered as Memorabilia & which are not signed but authenticated are called Collectibles.
The Memorabilia market is huge especially for sports items like baseball cards, football,
jersey, gloves etc. Different age group people from children to adults are collecting these
Memorabilia. With the growing popularity of eBay and other online auction companies,
sports Memorabilia market has become even more popular.
At present, there is huge value for this market as they are available in major locations to
purchase unlike in olden days, which includes: shows National Sports Collectors
Convention; dealers Sportsmemorabilia.com, Mounted Memories, Upper Deck, Steiner
Sports, Sportsinvestments.com, allauthentic.com, eckett.com, TriStar Productions,; and
auction houses Lelands, SCP Auctions, Goodwin & Co., Huggins & Scott, Hunt Auctions,
Robert Edward Auctions. Appraisals and authentication can be done through Roger Ponn
Associated Appraiers, Beckett Media, and dealers Robert Simon and Jerry Zuckerman.
Present size of Global Sports Memorabilia Market is $5 billion, out of which $1 billion is
contributed by U.S alone. Few examples are quoted below. Shoeless Joe Jackson signed
photograph authenticated by modern grading-services, found in a photo book that sat in a
trunk at the end of a bed in a Cleveland, OH house and was originally compiled by
Cleveland newspaper photographer Frank W. Smith in 1911 sold for $179,250 in Heritage
Auctions Saturday, Feb. 21 , 2015.
935
On July 30-31, 2015, at the National Sports Collectors Convention in Chicago, 1860s
Brooklyn Atlantics team baseball card appeared at public auction & brought $179,250.
Hobby history was made one year ago when the gloves worn in Cassius Clay's first defeat of
Sonny Liston sold for $836,500 in February 2014 by New York Platinum Night auction.
Only signed ticked from the "saddest day in Yankees history," brings $95,600 in Heritage
Auctions July 31, 2014 Platinum Night Sports Auction, at the National Sports Collectors
Convention in Cleveland.
In 1999, the ball with which McGwire achieved his record-breaking 70th home run was
bought by comic-book creator Todd McFarlane for a record-breaking $3 million.
An AC Milan shirt worn by Paolo Maldini during his final 2008-09 season which sold for
460 at Convery Auctions in May 2009.
A square-toe iron dated to the 1600s from the Jeffery B. Ellis collection which sold at
Sothebys New York in September 2007 for $151,000.
Counterfeit in Sports Memorabilia Market:
In 1990s, the two large forgery and fraudulent autograph and memorabilia enterprises were
identified by Federal Bureau of Investigation (FBI) in Chicago & San Diego. These two
organizations dumped various fake articles including the forged signatures of renowned
players like Babe Ruth, Lou Gehrig, Mickey Mantle, Magic Johnson signed on baseballs,
Muhammad Ali on Boxing gloves, LeBron James on Basketball.
The Chicago branch of the FBI conducted an operation called Foul Ball in which FBI
investigated a group of individuals to understand the authenticity of autographed sports items.
The FBI confiscated over 2,000 baseballs, 500 bats, 600 jerseys and several other items
including hats, helmets, pucks and photos & arrested fourteen individuals from five states.
These fraudulent organizations sold over $100 million dollars worth of deceptive
memorabilia in over 15 states. Initially, the forged items were sold strictly on the black
market, but eventually they infiltrated the legal market being sold at internet auction sites,
shopping malls, home shopping networks and sports memorabilia shows. Criminal operation
has changed the celebrity & sports memorabilia market but still the practice of selling
counterfeit memorabilia are in process. These are still sold in the market.
During Oct, 1999 FBI & Internal Revenue System (IRS) executed search warrant & sized
936
over $500,000 cash and approximately $10 million of forged memorabilia. The seized
memorabilia included over 10,000 forged baseballs, signed by a variety of athletes and
celebrities. Some of the autographs included:
Mother Teresa
Babe Ruth
Ty Cobb
Mickey Mantle
Roberto Clemente
Mark McGwire
Sammy Sosa
Tony Gwynn
The FBI and IRS also seized or purchased hundreds of "cut" autographs. These are pieces of
paper containing an autograph of an individual who has died many years ago.
Because of these fake & fraudulent sellers, the genuine dealers are adversely affected. They
are trying hard to regain the customers confidence in the memorabilia market.
Authentication of sports memorabilia are one step in that process. RFID is a one unique
technique by which fake autographed signatures can be identified.
RFID
Radio-frequency identification (RFID) is a wireless technology which uses electromagnetic
fields (a physical field produced by electrically charged objects ) to transfer data for
identifying and tracking tags attached to objects. The tags contain electronically stored
information. A tag can read from up to several feet away and does not need to be within
direct line-of-sight of the reader to be tracked. RFID includes two parts i.e., labels or tags &
reader. RFID tags or labels are fixed with a transmitter and a receiver. Microchip - a
component of RFID stores & processes information, and an antenna to receive and transmit a
signal. The tag contains the specific serial number for one specific object.
To read the information encoded on a tag, a two-way radio transmitter-receiver called an
interrogator or reader emits a signal to the tag using an antenna. The tag responds with the
information written in its memory bank. The interrogator will then transmit the results to an
RFID computer program.
937
Barcode is the other most common method of tagging used today. Almost all products that
are being sold have their own barcode that makes it easier for the teller to get the right price
of the product. But still RFID technology has its own advantages & it is differentiated from
Barcodes on the following parameters.
1. Barcodes uses a sensor and light to read the data on the tag while RFID uses radio
waves, which doesnt need line of sight, to get the data
2. Barcode scanners can only process tags one at a time while RFID scanners can
process dozens in a single second
3. Barcodes are really simple and can be easily replicated or counterfeited while RFID is
more complex and secure
4. RFID tags can be hidden to protect against the environment while barcodes need to be
exposed
5. Barcodes are very cheap while RFID tags are substantial pricier
RFID provides various advantages which are as follows:
RFID-enabled systems help companies cut costs, improve customer service, reduce
labor, increase accuracy, and improve production throughput.
Touch memory does not use optics but does require a relatively clean environment
because contact must be made to read the tag.
The tag can be read inside a case, carton, box or other container
RFID tags are used in many industries. For example, an RFID tag attached to an automobile
during production can be used to track its progress through the assembly line; RFID-tagged
pharmaceuticals can be tracked through warehouses; and implanting RFID microchips in
livestock and pets allows positive identification of animals. RFIDs can also be used in sports
memorabilia market to recognize counterfeit items.
938
http://100goals.sportsblog.com/posts/1555140/is_your_sports_memorabilia_counterfeit_or_a
uthentic__know_the_difference.html
http://thesportjournal.org/article/is-that-a-real-lebron-ball-rfid-and-sports-memorabilia/
http://www.epc-rfid.info/rfid
https://www.fbi.gov/sandiego/about-us/history/operation-bullpen
http://www.sportsmemorabilia.com/resources/sports-memorabilia-101.html
http://www.nydailynews.com/sports/more-sports/national-sports-collectors-conventionbaltimore-crashed-fbi-investigating-memorabilia-fraud-article-1.203869
http://www.ebay.com/gds/Avoid-Fraud-An-Autographed-Memorabilia-Guide/10000000000839526/g.html
http://www.intsystechnologies.com/rfid.php
http://www.rfidjournal.com/articles/view?3828/2
940
SOUVIK BANERJEE
RENNY THOMAS
ASSISTANT PROFESSORS,
ACHARYA BANGALORE BUSINESS SCHOOL
ABSTRACT
This paper pertains to analysis of operating performance vis. a vis. Rating of Tax Saving
Mutual fund schemes in India. The operating performance included Yearly Return, Jensens
Alpha, Sharpes Ratio, and Treynors Ratio. Rating is taken from CRISILs rating of mutual
fund schemes. Non parametric statistical analysis is used, as the data is not normally
distributed.
941
942
Introduction:
The Retail industry in India is highly unorganised and pre-dominantly consists of small,
independent, owner-managed shops. Retailing is Indias largest industry, accounting more
than 13% GDP. There are around 6 million retail outlets in India. As the Joke goes, if an
Italian looks at a corner, he scores a Goal, when an Indian looks at a corner, he sets up a pan
shop.
Taking the major portion of the pie in Retail industry is Clothing and Food industry. If you
look at the below table, you will get to know, for starting a business, Book store is not a Good
idea, as it is a niche product with very low demand.
What is a book? One get multiple answers depending upon the personality.
A School kid might say, its a Devil chasing
An Academic might say, its his earning
A Lawyer might say, its his living
An Author might say, its his soul that is speaking
But well, a Book Store owner might say, Book is everything.
With such love, Amit Rohit decided to sell books, but to what cost, he realised only after his
failure.
Lesson#1 Abhimanyu
943
There was a well-known saying about Retail business, Running a shop is like baby-sitting an
infant, you cannot afford to take a break. We need to work 24/7 and all 365 days.
On Christmas Eve 2013, Amit Rohit is leaving to his hometown from Bangalore. After
getting too busy with his shop for two years where he never got a chance to take a vacation.
Now, he is free from all responsibilities, he decided to shut down the operations and got into
a retrospection mood. What the hell went wrong?
As the bus kick started the engine, staring through the window, looking at the faded reflection
of himself and through the busy life of city, his thoughts slowly drifted to the past.
He thought himself, he should really change his name to Abhimanyu.
He see many parallels to himself and the character, Abhimanyu from Mahabharata. Both are
an epitome to half-knowledge.
Whenever Amits friends provoke him to explain why he started a book store. He proudly
makes a statement, A Book inspired a Book Store. If you ask further details, he will go to
an extent of gifting that book to you. Thats the amount of respect he got toward that book.
He met that book in the year, 2010. It is Black Swan written by Nassim Nicholas Taleb.
In Mahabharata, Abhimanyu, started listening to the story of Padmavyuha in his mothers
womb, where he listens how to enter inside the Padmavyuha war plot, but misses how to exit
and that leads to the sad demise of his life
Amit got the inspiration on how to start the business. But, neglected the essence of it in
entirety. Where it speaks, never start business with debt. Thats exactly where our protagonist
gone wrong.
Black Swan as a book teaches, about the rare events and how it impact our daily lives,
countrys economy, technological paradigm shifts, and stock market crashes.
Because, it gives a solid proof that economies are progressed by the failures of Entrepreneurs,
not by the profits of big corporates. Also, on the personal front, Black Swan author advices,
working for any organisation is a modern equivalent of slavery, living on your own terms is
the best life you should endeavour for.
Getting inspiration is easy part, but implementing it in real life is totally a herculean task in
reality.
-x-
Once Amits friend gave remark in Facebook, Books will be extinct my dear, eReaders like
Kindle is going to take over the market. Many of his friends, kept on making nasty remarks
behind his back, about the crazy venture Amit is about to take.
But, he always repeated one-line to keep his enthusiasm going, There is no such thing as
failed entrepreneur.
He even promised in his Facebook page, even if all the book stores are closed in the world, he
still want to stand as last samurai.
Amit need to face many unknown unknowns, when he wants to start a brick and mortar style
shop in India. Shop owners are rude in approach and highly money minded, advance is taken
for 10 months, vendors rarely stick to timelines from registering a company to placing a name
board, hiring the right person for the job.
With all these challenges, his actual project took 6 month delay and started on August 1 st,
2011. He invited all his friends and relatives on the first day. He got a collection of 3000+
books with the help of his father and sister.
There were times, where we did the shopping on books for 10 hours in a row.
I got the best in class book racks to give it more aesthetic approach and a spacious floor space
for the customer to browse around and just make them feel like a Library.
Shop location is highly commercial area, but the key mistake Amit has done is that the shop
is put up in 3 rd. floor with no elevator for the building. You can imagine, buying books from
a retail out-let is rarity, climbing 3 floors is an improbable event.
There was Justbooks Library which was 2 kms away from the shop location that was a huge
threat for Papyrus, because with Customers becoming more Cost-centric, they prefer to take
it as rent than own it.
Everything got tough in the beginning, from identifying vendors, hiring trust worthy
employees, marketing to 5000+ houses around J P Nagar.
I had question, but no one to answerAmit thought that was the Greatest challenge in life, it
is a text book with all questions but no answers at all and no one to evaluate.
Holding an engineering degree and experience in Corporate Job has greater disadvantage,
your friends are employees, your relatives are employees, every Tom, Dick and Harry you
meet in any social gathering is an employeeand if we dont hail from a business
communities (Like Marwari family), you are in more trouble.
Year 2011, is also a risky year as that was the year, eBooks are picking up and many Big
Book stores are closing down in Bangalore, be it the likes of Landmark, Gangarams and
Odyssey.
So, Books are not for everyone. Its a niche product, which attracts the educated class.
Papyrus book house is located in between a Medical Shop and Drapes Shop, which clearly an
945
indicator, walk-ins are expected to do window shopping rather than strong buying.
Also, competing with the discounts offered by Flipkart and Amazon is a big deal, attracting
customers with 30 to 50 % discount is a huge challenge.
One more edge with Online Retailers is the humongous collection they possess, which is
unimaginable for a physical store to maintain such stock. Many times, customers walked in
Papyrus book house and left the shop disappointed because the book they asked was never
there.
One more mistake, Papyrus failed to focus is to check the customer pulse. They bought
3000+ books, before setting up the shop, only later they realised thatPapyrus should have
bought more of kids segment books, because Parents prefer their kids to read more and more
books. Also, Books are bought as Birthday gift and return gift.
Lesson # 3, Owner should stay in Shop
When Amit was seriously thinking of quitting his corporate and take up the shop full time, he
got a brilliant advice from his American friend, Brent. He said only one thing, position
yourself as per this narration Try to be a Dentist, who write novels on weekends.
We all know the monotonous job, Dentist holds, but thats his bread winner and to spice up
his life, he cannot take up a Writer job as full time, because we never know, if it clicks or not.
So, Amit too managed with the help of his sister and a full time employee to take care of the
shop floor.
Amits evenings and weekends are fully booked for Papyrus, he used to do the Reception job.
But, the advice is good in a way that made him survive for all these years. But, ideally the
owner should stay in shop all over the day, and throughout the year. Thats the only to
improve the customer rapport.
Back of Amits mind, he always want to tie-up with Amazon or Flipkart, but he never got the
time to finish the paper work. Only after the closure of the Retail out let, he restarted the
business with whatever stock that is left over.
He had an offer as well from Justbooks for a mass sale, but didnt worked out, as they are
quoting for too high discounts.
There is one library chain, which came up with a franchisee model, neither that interested
him, as he always thought book store should hold the DNA of the owner. Else, it lost its
charm on the first place.
Today, many book stores became on super specialised category like the Book Store in
Rangashankara addresses the avid readers in Art, One book store serves only academics, One
book store serves only Spiritual category, few went to an extent of keeping only native
language books, few like Aata Galatta has a mixture of Caf, bakery and books.
946
For Amit, Book is a sacred thing. But, Book is still a costly affair to a middle class family. As
an average book costs 300 Rupees, they rather prefer to take it for rent with 30 Rupees or
read an eBook for free than spend such an amount.
The world doesnt look the way we want it to, we need to adapt ourselves to fit in. Book
Store opening page has a wonderful fan following in Facebook, but to stare at the profits, is a
sad figure.
Nevertheless, these are the follies Amit fallen in for. If all the Entrepreneurs out there keep
their feet on Ground and aim within ones limits, they are sure shot to make a success and as
the quote goes, live life of your own, its worth it
Phoenix Phenomena (Ashes to Rebirth)
In 2013, Amit got an idea to partner with Amazon as a Seller, thats when the Technology
have saved Amit, lets say, we can call it as a Resurrection. That is Ashes to Re-birth.
Today, whole stock Amit is holding after shutting down the physical store has re-started.
Now all he need to is some space for the books, marketing is done by Amazon, work flow
process is set in place by Amazon, Pick up of the product is done by Amazon, Billing is done
by Amazon and Pricing strategies are guided by Amazon. All Amit has to do, deliver the
product on time. Else, the customer ratings can pull Papyrus down.
Life got easier. All you need to do is, neatly pack the book, take print out of the packing slips
and wait at your Store Room for the Amazon pick-up associate. No need to worry about
premium shop rentals, no need to hire employees for managing the store, no need to worry
about stock collection.
Just run the business, at smooth pace.
Amazon app consists of Scan a product through bar code, which allows Papyrus to list the
product in less than 30 seconds.
Partnering with Snap Deal, got further benefits like additional funding support, fast shipping
offers, etc.
One more advantage what Amit holds with online selling is that, he can seek support from his
friends and Social media followers across India. Turn the Like buttons into Buy buttons.
To conclude, the greatest joy for any entrepreneur is to keep his hope alive, and that is
provided with abundance by e-Commerce realm.
Overall, its an Opportunity where Inter-connected Technology at its best, helping the
positive minds with brave hearts.
~The End~
947
INTRODUCTION
The education system in India puts more emphasis on the theoretical knowledge than
practical. In recent years, a model of higher education that emphasized the transmission of
knowledge and skills has given way to a new paradigm, which shifts the focus from the
instructor and toward the student. This is a shift from transactional to transformative
teaching. In transactional teaching, an instructor conveys information and students are
expected to assimilate and synthesize new knowledge on their own. Teaching can be didactic,
emphasizing the transfer of information. It can be philetic, in which the teacher serves as role
model and mentor. It can be evocative, assisting students in discovering the personal meaning
of a topic or text, rather than seeking some larger truth. Then there is heuristic teaching,
which engages students in a process of inquiry and discovery to help them develop the habits
of a particular discipline.
WHAT IS TEACHING?
Sequence
Relevance
Learner oriented
TEACHING PROCESS
2. Learners readiness: Teacher should ensure that the learners are intellectually ready for
what to be taught.
3. Previous experiences: Learners previous experiences are to be considered as the base for
lesson construction.
4. Individual differences: It is known that learners are different from one another in many
ways.
These differences must be realised by the teacher and should use a variety of methods and
materials to teach.
5. Teaching should be systematic: It should proceed from the known to unknown, simple to
complex, concrete to abstract and general to specific.
BASIC TEACHING METHODS
Teaching methods can generally be classified into two broad categories, namely:
- Learner-centred methods
- Teacher-centred methods
Learner -centred methods include:
Activity methods
Assignment
Supervised study
Discussion method
Field trip
Project method
Lecture method
2.
Questioning method
3.
Demonstration method
950
COMMON
TEACHING
METHODS
USING
IN
HIGHER
EDUCATIONAL
INSTITUTIONS (HEI)
The success or failure of any educational endeavour depends ultimately upon the
method adopted by the teacher. Methodology is first a science and then a way of teaching. As
a science methodology is the study of teaching methods. The person studying them, usually
the teacher or learner to be, endeavours to understand some of the various methods employed
in teaching different subjects, set of students and age grades. These methods are usually those
that have been tried or used by educationists and famous teachers in different parts of the
world, usually with a view to throwing and possibly using them.
The following methods of teaching are using in HEI:
Lecture method
Play-way method
951
Individual method
Demonstration method
Discussion method
952
development, making trainees apply what they have learnt or to monitor trainees learning by
way of feedback.
ROLE PLAY METHOD
In role plays, participants use their own experiences to play a real life situation. When
done well, role plays increase the participants self-confidence, give them the opportunity to
understand or even feel empathy for other peoples viewpoints or roles, and usually end with
practical answers, solutions or guidelines. Role plays are useful for exploring and improving
interviewing techniques and examining the complexities and potential conflicts of group
meetings. They help participants to consolidate different lessons in one setting and are good
energizers.
However, role plays can be time-consuming and their success depends on the
willingness of participants to take active part. Some trainees may feel a role play is too
exposing, threatening or embarrassing. This reluctance may be overcome at the outset by
careful explanation of the objectives and the outcome. Some role plays can generate strong
emotions amongst the participants. It is therefore essential that a role play is followed by a
thorough debriefing. This provides the opportunity for the trainer and the participants to raise
and assess new issues.
CHALLENGES
Challenges I
Challenges II
954
CONCLUSION
Many people mistakenly believe that great teachers are born, not made. To be sure,
some people are born with an intuitive gift for teaching. But every instructor can benefit from
an understanding of how students learn. Based on the theoretical study, what recent research
in neuroscience, cognitive and developmental psychology, and assessment has taught us
about student learning and how teachers able to apply these methods to improve teaching.
Charting a way forward has always been a concern to progressive minds. For any profession
to stand the test of time, both inward and external examinations/assessments are desirable. In
this paper, efforts have been made to chart a part of forwardness for our noble profession.
This study concluded that the teachers are doing an excellent job by equipping the teaching
methods by using various methodologies.
Author 1 :
Dr.P.Natesan,
Head and Dean,
Department of Commerce,
P.K.R. Arts College Arts College for Women,
Gobichettipalayam 638 476.
Author 2 :
Ms.A.Saroja,
Assistant Professor,
Department of Commerce,
955
956
Dr.A.Dhanalakshmi
Professor, Acharyas Bangalore Business School, Bengaluru
S.Rohitraj
Research Scholar, Jain University, Bengaluru
Dr.D.H.Rao
Professor & Dean, Skill & Research Development, SGBIT, Belagavi
ABSTRACT
Mutual Fund refers to the trust which pools the savings of a large number of investors
whose objectives are common. The money thus collected from the investors will be in turn
invested in the Capital Market and Money Market instrument, which depends on the funds
objective.
The household saving play an important role in domestic capital formation.
Investment experts are asking individual investors to take a serious look and a thorough study
at the performance and background of Equity Mutual Funds before investing. However, due
to their (Mutual funds) poor performance in the past, many investors are unenthusiastic.
Today in the present scenario, Mutual Funds have emerged as one of the important class of
financial intermediaries which cater to the needs of retail investors.
Evaluating historical performance of Mutual Fund is important both for investors as
well as portfolio managers. It enables an investor to access as to how much return has been
generated by the portfolio manager and what risk level has been assumed in generating such
returns.
This research work examines the performance of two Indian Open Ended Large Cap
oriented Equity Mutual Fund and Mid & Small Cap oriented Equity Mutual fund schemes. In
957
this paper, five portfolio performance measurement parameters like Beta, Standard Deviation,
Sharpe Ratio, Treynor Ratio and Jensens Alpha are used. The benchmark taken for this is
CNX NIFTY Index. The study is primarily done to evaluate the performance of the selected
Mutual Funds schemes over a period ranging from 2009 to 2014.
Keywords: Jensen Performance, Net Asset Value (NAV), Open Ended, Sharpe measure,
Treynor measure.
INTRODUCTION
958
Investment is saving money and engaging into something with the expectation of
earning profit in future. It is the commitment of money to gain profitable returns in the form
of Interest, Dividend and Appreciation of money. There are various avenues available in the
financial market such as Fixed Deposit, Public Provident Fund (PPF), National Savings
Certificate (NSC), Insurance, Real Estate, Mutual Funds, Securities etc., Other than the
returns, investor expects
Convenience, Brand, Tax relaxation, Security, Low cost and Transparency etc., There are
investors who are ready to bear the risk to get high returns and there are some investors who
are averse of taking risk.
Mutual Funds have emerged as one of the important class of financial intermediaries
which cater to the needs of retail investors. They have become an important vehicle for
mobilization of savings particularly from the household sector. Some experts insists that
Equity Mutual Funds are the best way for small investors to build a solid equity portfolio that
will help them meet various life goals. Only a small part of the household savings in India is
channelized to the capital market.
Mutual fund is supposed to be a better avenue for the individual investor whereby
their investment collected and diverted to the capital market to generate better returns for
them with lower volatility and risk. Individual investor generally enters into the stock
market to get better return, tax benefits and safety on their investment etc.
LITERATURE REVIEW
Gupta & Sehgal, (1998)
Mutual Funds: The Indian Experience tried to find out the investment performance of
80 schemes managed by 25 mutual funds, 15 in private sector and 10 in public sector for the
time period of June 1992-1996. The study has examined the performance in terms of fund
diversification and consistency of performance. The paper concludes that mutual fund
industrys portfolio diversification has performed well. But it supported the consistency of
performance pattern.
Syama Sunder (1998) conducted a survey to get an insight into the mutual fund
operations of private institutions with special reference to Kothari Pioneer. The survey
revealed that awareness about Mutual Fund concept was poor during that time in small cities
like Visakhapatnam.
959
The study
decomposed total return into return from investors risk, return from managers risk and target
risk. Mutual Fund return due to selectivity was decomposed into return due to selection of
securities and timing of investment in a particular class of securities.
Sapar & Narayan(2003) carefully examined the performance of Indian Mutual Funds
in a bearish market through relative performance index, risk-return analysis, Treynor's ratio,
Sharpe's ratio, and Jensen's measure with a sample of 269 open ended schemes (out of total
schemes of 433). The results of performance measures suggest that most of the Mutual Fund
schemes in the sample of 58 were able to satisfy investor's expectations by giving excess
returns over expected returns based on both premium for systematic risk and total risk.
Rao D. N (2006) studied the financial performance of selected open-ended equity
Mutual Fund schemes for the period 1st April 2005 - 31st March 2006 pertaining to the two
960
dominant investment styles and tested the hypothesis whether the differences in performance
are statistically significant. The analysis indicated that growth plans have generated higher
returns than that of dividend plans but at a higher risk.
Agrawal Deepak & Patidar Deepak (2009) studied the empirical testing on the basis
of fund managers performance and analyzed the data at the fund-manager and fund-investor
levels. The study revealed that the performance is affected by the saving and investment
habits of the people and at the second side the confidence and loyalty of the fund Manager
and rewards- affects the performance of the Mutual Fund industry in India.
Mehta Sushilkumar (2010) analyze the performance of Mutual Fund schemes of SBI
and UTI and found out that SBI schemes have performed better than the UTI in the year
2007-2008.
Selvam et.al (2011) studied the risk and return relationship of Indian Mutual Fund
schemes. The study found out that out of thirty five sample schemes, eleven showed
significant tvalues and all other twenty four sample schemes did not prove significant
relationship between the risk and return. According to t-alpha values, majority (thirty two) of
the sample schemes returns were not significantly different from their market returns and
very few number of sample schemes returns were significantly different from their market
returns during the study period.
To examine the funds sensitivity to the market fluctuation in the terms of Beta, and
To appraise the performance of UTI & Birla Sun Life Mutual fund schemes with
regard to risk-return adjustment, the model suggested by Sharpe, Treynor and Jensen.
961
RESEARCH METHODOLOGY
The Mutual Funds schemes selected are UTI Equity fund and Birla Sun life Mid
Cap fund. The NAV (Net Asset Value) of these Mutual Funds for the period ranging from
2009 to 2014 is collected from secondary sources like Association of Mutual Funds of
India (AMFI). This data was collected in an excel sheet and then, based on this data we
have calculated Alpha, Beta, Standard Deviation, Sharpe Ratio, Treynor Ratio and Jensen s
Alpha for each of the fund. This data is analyzed and compared and inferences are drawn.
The data for this study is gathered from the following secondary sources:
Further, the finance journals, magazines, newspapers, market reports, fund fact sheets and
the annual reports of other Mutual Fund companies were also scrutinized. The data thus
collected is be analyzed with the help of statistical tools.
962
Year
Closing
Fund
Return (%)
(RI)
CNX
NIFTY
(RI-
CNX
RI-
(RI-
RM-
(RM-
NIFTY
)*(RM)SQ
Return
)SQ
2009
48.68
---
5201.05 ---
---
---
---
---
2010
58.66
20.50
6134.5
17.95
2.35
5.53
5.04
25.36
2011
47.46
-19.09
4624.3
-24.62
1387.02
-37.53 1408.46
1397.70
2012
62.72
32.15
6016.15 30.10
17.19
295.40
240.69
2013
67.46
7.56
6211.15 3.24
112.20
-9.67
93.51
102.43
100.94
49.63
8564.4
31.48 990.97
24.98
623.81
786.24
2014
DEC 05
37.24
14.00 196.10
10.59
37.89
Source : NAV of the scheme taken from AMFI Website and returns Computed
TABLE 2: RISK & RETURN ANALYSIS OF THE FUND
Annualised Return
18.15
Standard Deviation
23.20
NIFTY return
12.91
Beta
1.04
Alpha
5.06
8.22
SPI
0.43
TPI
9.57
JPI
18.15
Source : Computed
963
11.84
RI-
Fund
NIFTY
RM-
RM-
(RI-
NAV
Return
RI-
SQ
CNX
Return
Jan open
108.11
---
---
---
6304
---
---
---
---
Jan
104.69
-3.16
-6.64
44.07
6089.5
-3.40
-6.01
36.14
39.91
Feb
107.78
2.95
-0.52
0.27
6276.95
3.08
0.47
0.22
-0.25
March
115.13
6.82
3.34
11.18
6704.2
6.81
4.20
17.62
14.04
April
115.26
0.11
-3.36
11.31
6696.4
-0.12
-2.73
7.43
9.16
May
126.91
10.11
6.63
43.99
7229.95
7.97
5.36
28.72
35.54
June
136.58
7.62
4.14
17.17
7611.35
5.28
2.67
7.11
11.05
July
137.92
0.98
-2.49
6.22
7721.3
1.44
-1.16
1.36
2.90
August
144.05
4.44
0.97
0.94
7954.35
3.02
0.41
0.17
0.40
Sept
147.64
2.49
-0.98
0.97
7964.8
0.13
-2.48
6.14
2.44
Oct
154.74
4.81
1.33
1.78
8322.2
4.49
1.88
3.53
2.51
Nov
160.98
4.03
0.56
0.31
8588.25
3.20
0.59
0.35
0.33
Dec
161.78
0.50
-2.98
8.87
8538.3
-0.58
-3.19
10.18
9.50
3.48
0.00
12.26
2.61
0.00
9.91
127.53
Average
)*(RM-
SQ
Source : NAV of the scheme taken from AMFI Website and returns Computed
Monthly Return
3.48
Standard Deviation
3.50
NIFTY return
2.61
Beta
1.07
Alpha
0.73
0.69
SPI
0.80
TPI
2.60
JPI
3.48
Source : Computed
964
pool of mid-sized companies, our fund managers intend to select those well-run, well-led
ones that show the potential of becoming tomorrow's leaders. Moreover, we look for
companies already growing on their own, when they do become big, you can book handsome
returns.
(RI-
NIFTY
NAV
Return
CNX
RETURN
Year
Closing
(%) (RI)
NIFTY
(%)
2009
104.84
---
2010
118.78
2011
(RI-
RM-
(RM-
)*(RM-
RI-
)SQ
)SQ
5201.05 ---
---
---
---
---
---
13.30
6134.5
17.95
-5.27
27.81
5.04
25.36
-26.56
87.36
-26.45
4624.3
-24.62
-45.02
2026.97 -37.53
1408.46 1689.65
2012
118.94
36.15
6016.15 30.10
17.58
309.05
17.19
295.40
302.15
2013
116.54
-2.02
6211.15 3.24
-20.59
423.84
-9.67
93.51
199.08
200.3
71.87
8564.4
53.30
2841.18 24.98
623.81
1331.30
2014
DEC
05
37.89
Source : NAV of the scheme taken from AMFI Website and returns Computed
Annualised Return
18.57
Standard Deviation
33.55
965
NIFTY return
12.91
Beta
1.43
Alpha
3.65
8.22
SPI
0.31
TPI
7.24
JPI
18.57
Source : Computed
TABLE 7: ONE YEAR RETURN ANALYSIS OF THE FUND
Fund
NIFTY
NAV
Return
RI-
SQ
CNX
Return
Open
116.54
---
---
---
6304
---
Jan
113.34
-2.75
-7.46
55.65
Feb
118.57
4.61
-0.10
March
126.92
7.04
April
130.9
May
RM-
RM-
(RI)
SQ
Jan
---
---
---
6089.5 -3.40
-6.01
36.14
44.85
0.01
6277
3.08
0.47
0.22
-0.05
2.33
5.42
6704.2 6.81
4.20
17.62
9.77
3.14
-1.58
2.49
6696.4 -0.12
-2.73
7.43
4.30
149.7
14.36
9.65
93.08
7230
7.97
5.36
28.72
51.70
June
166.45
11.19
6.47
41.92
7611.4 5.28
2.67
7.11
17.27
July
163.94
-1.51
-6.22
38.71
7721.3 1.44
-1.16
1.36
7.24
August
167.16
1.96
-2.75
7.56
7954.4 3.02
0.41
0.17
-1.13
Sept
174.34
4.30
-0.42
0.18
7964.8 0.13
-2.48
6.14
1.04
Oct
184.49
5.82
1.11
1.23
8322.2 4.49
1.88
3.53
2.08
Nov
193.6
4.94
0.22
0.05
8588.3 3.20
0.59
0.35
0.13
Dec
200.3
3.46
-1.25
1.57
8538.3 -0.58
-3.19
10.18
4.00
4.71
0.00
20.66
0.00
9.91
141.21
Average
2.61
Source : NAV of the scheme taken from AMFI Website and returns Computed
Monthly Return
4.71
966
)*(RM-
Standard Deviation
4.54
NIFTY return
2.61
Beta
1.19
Alpha
1.75
0.69
SPI
0.89
TPI
3.39
JPI
4.71
Source : Computed
CONCLUSION
967
2004)
pp.45-63.
6. Davis, James L (2001), Mutual Fund Performance and Manager Style, Journal of
Financial Analysts, Vol. 57 (1), (January / February 2001) pp. 19-27.
968
S.ROHITRAJ
RESEARCH SCHOLAR, JAIN UNIVERSITY, BENGALURU
DR.D.H.RAO.
PROFESSOR & DEAN, SKILL & RESEARCH DEVELOPMENT, SGBIT,
BELAGAVI
ABSTRACT
Mutual funds have opened new vistas to millions of small investors by virtually
taking investment to their doorstep. In India, retail investors generally get attracted towards
such kind of information, which do not provide hedge against inflation and often have
negative real returns. In this current scenario it is very important to identify needs of mutual
funds investors, their preference for mutual funds schemes and its performance evaluation.
Mutual Fund refers to the trust which pools the savings of a large number of investors
whose objectives are common. The money thus collected from the investors will be in turn
invested in the Capital Market and Money Market instrument, which depends on the funds
objective.
Evaluating historical performance of Mutual Fund is important both for investors as
well as portfolio managers. It enables an investor to access as to how much return has been
generated by the portfolio manager and what risk level has been assumed in generating such
returns.
This research examines the performance of Indian Open Ended Large Cap oriented
Equity Mutual Fund and Mid & Small Cap oriented Equity Mutual fund schemes. In this
paper, five portfolio performance measurement parameters like Beta, Standard Deviation,
Sharpe Ratio, Treynor Ratio and Jensens Alpha are used. The benchmark taken for this is
CNX NIFTY Index. The study is primarily done to evaluate the performance of the selected
Mutual Funds schemes over a period ranging from 2009 to 2014.
Keywords: Jensen Performance, Net Asset Value (NAV), Open Ended, Sharpe
measure, Treynor measure.
969
INTRODUCTION
In Equity market, direct investment would be riskier for small investors. In such
cases to hedge his position the investor can make his investments into equity oriented mutual
funds which invests percentage of money into equity.
The money invested in various stocks depending on the objectives of the mutual fund
scheme and the profits (or loss) are shared among investors in proportion to their investment.
Investments in stocks are spread across a wide cross-section of industries and sectors.
Diversification reduces the risk because all stocks may not move in the same direction in the
same proportion at the same time.
Mutual fund issues units to the investors in accordance with quantum of money
invested by them. Investors of mutual funds are known as unit holders. The profits or losses
are shared by the investors in proportion to their investment. A mutual fund is administered
through a parent management company, which may hire or fire fund managers. Mutual funds
are liable to a special set of regulatory, accounting, and tax rules. Unlike most other types of
business entities, they are not taxed on their income as long as they distribute substantially all
of it to their shareholders. Also, the type of income they earn is often unchanged as it passes
through to the shareholders. Mutual fund distributions of tax-free municipal bond income are
also tax-free to the shareholder. Taxable distributions can be either ordinary income or capital
gains, depending on how the fund earned those distributions.
LITERATURE REVIEW
A number of studies and research have been made on the Mutual Fund industry.
Many of them are areas related to Mutual funds operation, performance analysis, growth and
development of Mutual Funds, perceptual views of investors on Mutual Funds.
S.K. Miglani (2007) in his study made an attempt to understand the Mutual Fund
industry and its implications on the common investors on one hand and its returns and
performance on the other.
Gajendra Sidana and Debashis Acharya (2007) in their article Classifying Mutual
Funds in India: Some Results from Clustering made an attempt to classify hundred Mutual
Funds employing cluster analysis and using a host of criteria like the 1 year annualized
return, 3 year annualized return, 5 year annualized return, alpha, beta, R-squared, Sharpes
ratio, mean and standard deviation etc.
970
P. Hnaumantha Rao and Vijay K.R. Mishra (2007) in their article Mutual Fund: A
Resource Mobiliser in Financial Market made a critical study of the role performed by
Mutual Funds as a financial service in Indian Financial Market.
Nalini Prava Tripathy (2006) in her empirical study Market Timing Abilities and
Mutual Fund Performance- An Empirical Investigation into Equity Linked Saving Schemes
evaluated the market timing abilities of Indian Fund managers of thirty-one tax planning
schemes in India over the period December, 1995 to January, 2004 by using Jensen and
Mazuy Model and Henriksson and Merton model. The study indicates that the Fund
managers have not been successful in reaping returns in excess of the market; rather they are
timing the market in the wrong direction.
Ippolito (1992) says that fund/scheme selection by investors is based on past
performance of the funds and money flows into winning funds more rapidly than they flow
out of losing funds.
Robert J. Shiller (1993) reported that many investors do not have data analysis and
interpretation skills. This is because; data from the market supports the merits of index
investing, passive investors are more likely to base their investment choices on information
received from objective or scientific sources.
To examine the funds sensitivity to the market fluctuation in the terms of Beta, and
To appraise the performance of LIC Nomura Mutual Fund and Kotak Mutual
Fund schemes with regard to risk-return adjustment, the model suggested by Sharpe,
Treynor and Jensen.
971
RESEARCH METHODOLOGY
The Mutual Funds schemes selected are LIC Nomura Equity Fund and Kotak Mid
Cap fund. The NAV (Net Asset Value) of these Mutual Funds for the period ranging from
2009 to 2014 is collected from secondary sources like Association of Mutual Funds of India
(AMFI). This data was collected in an excel sheet and then, based on this data we have
calculated Alpha, Beta, Standard Deviation, Sharpe Ratio, Treynor Ratio and Jensen s Alpha
for each of the fund. This data is analyzed and compared and inferences are drawn.
ALPHA
Alpha is a measure of the risk adjusted return that a manager (in the case of an investment
fund) or management (in the case of a company or stock) is able to generate based on their
skill and value add. A positive alpha of 1.0 means the fund has outperformed its benchmark
index by 1%. Correspondingly, a similar negative alpha would indicate an underperformance
of 1%.
BETA
Beta is the standard for measuring market risk. Beta is the measure of a particular stocks
movement in relation to the movement of the overall market (typically the Sensex or Nifty).
Beta measures co-movement between the market (all stocks) and the individual stocks that
comprise the market.
STANDARD DEVIATION
972
SHARPE RATIO
The Sharpe ratio is calculated by subtracting the risk-free rate from the rate of return for a
portfolio and dividing the result by the standard deviation of the portfolio returns.
The Sharpe is calculated as:
Sharpe formula : (rp rf) / p
where,
rp is the Expected total Portfolio return,
rf is the risk free rate, and
p is the portfolio standard deviation
.
TREYNOR RATIO
JENSEN'S MEASURE
where,
973
The data for this study is gathered from the following secondary sources:
Further, the finance journals, magazines, newspapers, market reports, fund fact sheets and
the annual reports of other Mutual Fund companies were also scrutinized. The data thus
collected will be analyzed with the help of statistical tools.
(RI-
NAV
Return
CNX
NIFTY
Closing
(%)
NIFTY
Return
RI-
(RI-
RM-
(RM)*(RM-
)SQ
)SQ
(RI)
2009
25.07
---
5201.05
---
---
---
---
---
---
2010
29.08
16.00
6134.5
17.95
2.25
5.04
5.04
25.36
11.31
2011
21.21
-27.06
4624.3
-24.62
-40.81
1665.72 -37.53
1408.46
1531.70
2012
27.25
28.48
6016.15
30.10
14.73
216.89
17.19
295.40
253.12
2013
28.78
5.61
6211.15
3.24
-8.14
66.18
-9.67
93.51
78.67
41.94
45.73
8564.4
37.89
31.98
1022.48 24.98
623.81
798.64
2014
DEC
05
Source : NAV of the scheme taken from AMFI Website and returns Computed
974
13.75
Standard Deviation
24.40
NIFTY return
12.91
Beta
1.09
Alpha
0.40
8.22
SPI
0.23
TPI
5.06
JPI
13.75
Source : Computed
Kotak Mid Cap follows the strategy of identifying mid cap company stocks across
various sectors which may have the potential to become large caps in the near future. The
essence is to 'spot them young and watch them grow'. The fund endeavors to take advantage of
975
NAV
(RI-
Fund
NIFTY
RETURN
(RI-
RM-
(RM-
RI-
)SQ
5201.05 ---
---
---
---
---
---
27.99
6134.5
17.95
4.38
19.15
5.04
25.36
22.04
20.09
-26.89
4624.3
-24.62
2012
30.18
50.22
6016.15 30.10
26.61
707.94
17.19
295.40
457.30
2013
28.69
-4.94
6211.15 3.24
-28.55 815.33
-9.67
93.51
276.12
DEC 05 49.26
71.70
8564.4
48.08
623.81
1200.87
Year
Closing (RI)
NIFTY
2009
21.47
---
2010
27.48
2011
(%)
)SQ
)*(RM)
2014
37.89
2311.74 24.98
Source : NAV of the scheme taken from AMFI Website and returns Computed
976
Source
Annualised Return
23.62
Standard Deviation
35.79
NIFTY return
12.91
Beta
1.57
Alpha
8.01
8.22
SPI
0.43
TPI
9.78
JPI
23.62
Computed
CONCLUSION
977
It has a positive alpha value of 8.01 which means the fund has outperformed than its
benchmark. Its benchmark index is Nifty and beta of 1.57. The fund expected a return 1.57
times the Nifty returns in an up market. The Standard Deviation is 35.79 and with Beta
greater than 1, this is a highly volatile fund as shown in Table 4.
The Sharpe Ratio is 0.43 which is very low, thus the risk taken to generate the returns
is very high. Treynor Ratio is 9.78, thus the fund has earned 9.78% more than the risk free
return. Jensens alpha is 23.62 which is a positive value. Thus, the fund is earning more than
the expected returns.
REFERENCES
978
27. Vikas Kumar (2011), Performance Evaluation of Open Ended Schemes of Mutual
Funds , Zenith International Journal, Vol.1 Issue 8.
28. Zvi B & Mohanty (2005), Investments TMH 6th Edition.
979
Keywords:
Internet of Things, Ubiquitous sensing, Cloud computing, Wireless sensor networks,
RFID.
Introduction
The Internet of Things (IoT) refers to the use of intelligently connected devices and systems
to leverage data gathered by embedded sensors and actuators in machines and other physical
980
objects. IoT is expected to spread rapidly over the coming years and this convergence will
unleash a new dimension of services that improve the quality of life of consumers and
productivity of enterprises, unlocking an opportunity that the GSMA refers to as the
Connected Life.
For consumers, the IoT has the potential to deliver solutions that dramatically improve
energy efficiency, security, health, education and many other aspects of daily life. For
enterprises, IoT can underpin solutions that improve decision-making and productivity in
manufacturing, retail, agriculture and other sectors.
Machine to Machine (M2M) solutions - a subset of the IoT already use wireless networks
to connect devices to each other and the Internet, with minimal direct human intervention, to
deliver services that meet the needs of a wide range of industries. In 2013, M2M connections
accounted for 2.8% of global mobile connections (195 million), indicating that the sector is
still at a relatively early stage in its development. An evolution of M2M, the IoT represents
the coordination of multiple vendors machines, devices and appliances connected to the
Internet through multiple networks.
While the potential impact of the IoT is considerable, a concerted effort is required to move
beyond this early stage. In order to optimize the development of the market, a common
understanding of the distinct nature of the opportunity is required. To date, mobile operators
have identified the following key distinctive features:
The Internet of Things can enable the next wave of life-enhancing services across
several fundamental sectors of the economy.
Meeting the needs of customers may require global distribution models and consistent
global services.
The Internet of Things presents an opportunity for new commercial models to support
mass global deployments.
981
Some described it as
including embedded intelligence in individual items that can detect changes in their
physical state. Yet some other, noting the lack of an agreed-upon definition of the IoT,
observed, What all definitions of IoT have in common is that they focus on how computers,
sensors, and objects interact with one another and process data.
The IoT includes consumer-facing devices, as well as products and services that are not
consumer-facing, such as devices designed for businesses to enable automated
communications between machines. For example, the term IoT can include the type of Radio
Frequency Identification (RFID) tags that businesses place on products in stores to monitor
inventory; sensor networks to monitor electricity use in hotels; and Internet-connected jet
engines and drills on oil rigs. Moreover, the things in the IoT generally do not include
desktop or laptop computers and their close analogs, such as Smartphones and tablets,
although these devices are often employed to control or communicate with other things.
For purposes of this report, we use the term IoT to refer to things such as devices or sensors
other than computers, Smartphones, or tablets that connect, communicate or transmit
information with or between each other through the Internet. Consistent with the FTCs
mission to protect consumers in the commercial sphere, our discussion of IoT is limited to
such devices that are sold to or used by consumers. Accordingly, the report does not discuss
devices sold in a business-to-business context, such as sensors in hotel or airport networks;
nor does it discuss broader machine-to-machine communications that enable businesses to
track inventory, functionality, or efficiency.
982
In the home...
In the city...
And beyond
Connected
Devices/Cars
Connected Home
Smart Cities
Agriculture
.
Connected
Life will have a fundamental impact on the way we live and work, there will also
be major social and environmental benefits, such as improved healthcare, safer and more
efficient transportant and logiistics, better education and more efficient use of energy. With
the ability to capture real-time usage information and provide remote control, embedded
mobile connectivity can make a wide range of devices, machines and vehicles mor efficient
and effective, dramatically reducing waste and improving time productivity.
FIGURE : SOCIO- ECONOMIC IMPACT OF THE CONNECTED LIFE IN 2017
Such services will also contribute to economic growth by creating new business opportunities
for mobile operators, equipment vendors and other players in the mobile ecosystem as well as
in adjacent industries. They will represent a very important demand-side stimulus that helps
983
finance the deployment of upgraded mobile networks able to provide IOT and broadband
connectivity around the world.
The connected devices market will open-up new revenue streams, facilitate new business
models, drive efficiencies and improve the way existing services across many different
sectors are delivered.
The global business impact of the Connected Life can be split into two broad categories:
new revenue opportunities and cost reduction and service improvements.
In 2020, revenues from the sale of connected devices and services, and revenues from
related services, such as pay-as-you-drive car insurance, will be worth US$2.5 trillion,
US$1.2 trillion of which could be addressed by mobile operators and the remainder by
the broader Connected Life ecosystem.
Cost reductions and service improvements relate to less direct, but tangible, benefits to
organizations, governments and consumers through the evolution of the Connected
Life. In 2020, this could be worth approximately US$2 trillion: US$1 trillion from cost
reductions, such as smart meters removing the need for manual meter readings; and
US$1 trillion from service improvements, such as clinical remote monitoring for
patients with chronic illnesses.
984
can be seen in below figure, thirteen industry sectors are likely to show significant adoption
of IoT services:
Figure: Internet of Things Industry Sector Categories
Intell
igent
build
ings
Smar
t
cities
and
trans
port
ation
Auto
moti
ve
Heal
th
ElectCons
ronic
umer
s
Utilit
ies
Leisu
Retai
re land
Man
ufact
uring
World D
Well
Cons
truct
ion
Su pply chai
Envir
Agric
onmultur
ent eand
Intelligent living
Intelligent enterprise
For consumers, connectivity provided by the IoT could enhance their quality of life in
multiple ways, such as, but not limited to, energy efficiency and security at home and in the
city. In the home, the integration of connected smart devices and cloud-based services will
help address the pressing issue of energy efficiency and security. Connected smart devices
will enable a reduction in utility bills and outages, while also improving home security via
remote monitoring.
In cities, the development of smart grids, data analytics and autonomous vehicles will provide
an intelligent platform to deliver innovation in energy management, traffic management and
security, sharing the benefits of this technology throughout society.
The IoT will also help widen access and improve quality of education and health. As demand
for healthcare doubles, connected smart devices will help address this challenge by
985
NatiEner
onalgy
secur
servi
ity ces
and
supporting a range of e-health services that improve access and enable monitoring of chronic
diseases and age-related conditions in the home. In doing so, they will improve the quality of
care and quality of life for patients, while reducing the strain on the wider healthcare system.
Benefits
Many agreed that the IoT will offer numerous, and potentially revolutionary, benefits to
consumers. One area in which these benefits appear highly promising is health care. For
example, insulin pumps and blood-pressure cuffs that connect to a mobile app can enable
people to record, track, and monitor their own vital signs, without having to go to a doctors
office. This is especially beneficial for aging patients, for whom connected health devices can
provide treatment options that would allow them to manage their health care at home
without the need for long-term hospital stays or transition to a long-term care facility.
Patients can also give caregivers, relatives, and doctors access to their health data through
these apps, resulting in numerous benefits. As one panelist noted, connected health devices
can improve quality of life and safety by providing a richer source of data to the patients
doctor for diagnosis and treatment improve disease prevention, making the healthcare system
more efficient and driving costs down and provide an incredible wealth of data,
revolutionizing medical research and allowing the medical community to better treat, and
ultimately eradicate, diseases.
Recent studies demonstrate meaningful benefits from connected medical devices. It has been
said that one of the most significant benefits that we have from this connected world is the
ability to draw the patients in and engage them in their own care. Some other described a
clinical trial showing that, when diabetic patients used connected glucose monitors, and their
physicians received that data, those physicians were five times more likely to adjust
medications, resulting in better disease management and substantial financial savings for
patients. He stated that the clinical trial demonstrated that diabetic patients using the
connected glucose monitor reduced their average blood sugar levels by two points and that,
986
by comparison, the Food and Drug Administration (FDA) considers medications that reduce
blood sugar by as little as one half point to be successful.
Consumers can benefit from the IoT in many other ways. In the home, for example, smart
meters can enable energy providers to analyze consumer energy use and identify issues with
home appliances, even alerting homeowners if their insulation seems inadequate compared
to that of their neighbors, thus empowering consumers to make better decisions about how
they use electricity.
platform that can connect all of the devices within the home, with a single app for controlling
them. Connected ovens allow consumers to set their temperatures remotely, go from bake
to broil, and monitor their products from various locations inside and outside their homes.
Sensors known as water bugs can notify consumers if their basements have flooded, and
wine connoisseurs can monitor the temperature in their wine cellars to preserve their finest
vintages.
On the road, connected cars will increasingly offer many safety and convenience benefits to
consumers. For example, sensors on a car can notify drivers of dangerous road conditions,
and software updates can occur wirelessly, obviating the need for consumers to visit the
dealership.
Connected cars also can offer real-time vehicle diagnostics to drivers and
service facilities; Internet radio; navigation, weather, and traffic information; automatic alerts
to first responders when airbags are deployed; and Smartphone control of the starter and other
aspects of the car. In the future, cars will even drive themselves.
987
Risks
Despite these important benefits, there was broad agreement among participants that
increased connectivity between devices and the Internet may create a number of security and
privacy risks.
SECURITY RISKS
According to panelists, IoT devices may present a variety of potential security risks that
could be exploited to harm consumers by: (1) enabling unauthorized access and misuse of
personal information; (2) facilitating attacks on other systems; and (3) creating safety risks.
Although each of these risks exists with traditional computers and computer networks, they
are heightened in the IoT, as explained further below.
First, on IoT devices, as with desktop or laptop computers, a lack of security could enable
intruders to access and misuse personal information collected and transmitted to or from the
device. For example, new smart televisions enable consumers to surf the Internet, make
purchases, and share photos, similar to a laptop or desktop computer. Like a computer, any
security vulnerabilities in these televisions could put the information stored on or transmitted
through the television at risk. If smart televisions or other devices store sensitive financial
account information, passwords, and other types of information, unauthorized persons could
exploit vulnerabilities to facilitate identity theft or fraud. Thus, as consumers install more
smart devices in their homes, they may increase the number of vulnerabilities an intruder
could use to compromise personal information.
Second, security vulnerabilities in a particular device may facilitate attacks on the consumers
network to which it is connected, or enable attacks on other systems.
According to the most recent statistics from the Bureau of Justice Statistics of the
Department of Justice, an estimated 16.6 million Americans about seven percent of
Americans sixteen or older experienced at least one incident of identity theft in 2012.
Losses due to personal identity theft totaled $24.7 billion, billions of dollars more than the
losses for all other property crimes combined.
988
Another study demonstrated that one in four people who received notice of a breach
involving their personal information were victims of identity theft, a significantly higher
figure than for individuals who did not receive a breach notice.
Denial of service attacks are more effective the more devices the attacker has under his or her
control; as IoT devices proliferate, vulnerabilities could enable these attackers to assemble
large numbers of devices to use in such attacks. Another possibility is that a connected
device could be used to send malicious emails.
Third, unauthorized persons might exploit security vulnerabilities to create risks to physical
safety in some cases. An individual described how he was able to hack remotely into two
different connected insulin pumps and change their settings so that they no longer delivered
medicine.
the cars internal computer network without ever physically touching the car. He described
how he was able to hack into a cars built-in telematics unit and control the vehicles engine
and braking, although he noted that the risk to car owners today is incredibly small, in part
because all the automotive manufacturers that I know of are proactively trying to address
these things. Although the risks currently may be small, they could be amplified as fully
automated cars, and other automated physical objects, become more prevalent. Unauthorized
access to Internet-connected cameras or baby monitors also raises potential physical safety
concerns. Likewise, unauthorized access to data collected by fitness and other devices that
track consumers location over time could endanger consumers physical safety. Another
possibility is that a thief could remotely access data about energy usage from smart meters to
determine whether a homeowner is away from home.
These potential risks are exacerbated by the fact that securing connected IoT devices may be
more challenging than securing a home computer, for two main reasons. First, as some
panelists noted, companies entering the IoT market may not have experience in dealing with
security issues. Second, although some IoT devices are highly sophisticated, many others
may be inexpensive and essentially disposable.
989
PRIVACY RISKS
In addition to risks to security, participants identified privacy risks flowing from the Internet
of Things. Some of these risks involve the direct collection of sensitive personal information,
such as precise geo location, financial account numbers, or health information risks already
presented by traditional Internet and mobile commerce. Others arise from the collection of
personal information, habits, locations, and physical conditions over time, which may allow
an entity that has not directly collected sensitive information to infer it.
The sheer volume of data that even a small number of devices can generate is stunning: it has
been said that fewer than 10,000 households using one of a companys IoT home automation
product can generate 150 million discrete data points a day or approximately one data
point every six seconds for each household.
Such a massive volume of granular data allows those with access to the data to perform
analyses that would not be possible with less rich data sets. According to a participant,
researchers are beginning to show that existing smartphone sensors can be used to infer a
users mood; stress levels; personality type; bipolar disorder; demographics (e.g., gender,
marital status, job status, age); smoking habits; overall well-being; progression of Parkinsons
disease; sleep patterns; happiness; levels of exercise; and types of physical activity or
movement. Some noted that such inferences could be used to provide beneficial services to
consumers, but also could be misused. Relatedly, another referred to the IoT as enabling the
collection of sensitive behavior patterns, which could be used in unauthorized ways or by
unauthorized individuals. Some cited to general privacy risks associated with these granular
information-collection practices, including the concern that the trend towards abundant
collection of data creates a non-targeted dragnet collection from devices in the
environment.
Others noted that companies might use this data to make credit, insurance, and employment
decisions. For example, customers of some insurance companies currently may opt into
programs that enable the insurer to collect data on aspects of their driving habits such as in
one case, the number of hard brakes, the number of miles driven, and the amount of time
spent driving between midnight and 4 a.m. to help set the insurance rate. Use of data for
credit, insurance, and employment decisions could bring benefits e.g., enabling safer
drivers to reduce their rates for car insurance or expanding consumers access to credit but
990
such uses could be problematic if they occurred without consumers knowledge or consent, or
without ensuring accuracy of the data.
As a further example, one researcher has hypothesized that although a consumer may today
use a fitness tracker solely for wellness-related purposes, the data gathered by the device
could be used in the future to price health or life insurance or to infer the users suitability for
credit or employment (e.g., a conscientious exerciser is a good credit risk or will make a good
employee). According to one commenter, it would be of particular concern if this type of
decision-making were to systematically bias companies against certain groups that do not or
cannot engage in the favorable conduct as much as others or lead to discriminatory practices
against protected classes.
Conclusions
The proliferation of devices with communicatingactuating capabilities is bringing closer the
vision of an Internet of Things, where the sensing and actuation functions seamlessly blend in
to the background and new capabilities are made possible through access of rich new
information sources. The evolution of the next generation mobile system will depend on the
creativity of the users in designing new applications. IoT is an ideal emerging technology to
influence this domain by providing new evolving data and the required computational
resources for creating revolutionary apps. Presented here is a user-centric cloud based model
for approaching this goal through the interaction of private and public clouds. In this manner,
the needs of the end-user are brought to the fore. Allowing for the necessary flexibility to
meet the diverse and sometimes competing needs of different sectors, we propose a
framework enabled by a scalable cloud to provide the capacity to utilize the IoT. The
framework allows networking, computation, and storage and visualization themes separate
thereby allowing independent growth in every sector but complementing each other in a
shared environment. The standardization which is underway in each of these themes will not
be adversely affected with Cloud at its center. In proposing the new framework associated
challenges have been highlighted ranging from appropriate interpretation and visualization of
the vast amounts of data, through to the privacy, security and data management issues that
must underpin such a platform in order for it to be genuinely viable. The consolidation of
international initiatives is quite clearly accelerating progress towards an IoT, providing an
overarching view for the integration and functional elements that can deliver an operational
IoT.
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Reference:
Pahlavan, K., Krishnamurthy, P., Hatami, A., Ylianttila, M., Makela, J.P., Pichna, R.
and Vallstron, J. (2007) Handoff in Hybrid Mobile Data Networks. Mobile and
Wireless Communication Summit, 7, 43-47.
Chen, X.-Y. and Jin, Z.-G. (2012) Research on Key Technology and Applications for
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of
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Physics
Procedia,
http://dx.doi.org/10.1016/j.phpro.2012.05.104
992
33,561-566.
DOKKU RAVEENA
2ndYEAR, ABBS
Abstract
Keywords
Human Resource Management, Big Data, Recruitment, Talent Training, Talent assessment
1. Introduction
Humanity has been creating a steady stream of data since the date of birth. Data can be said
to exist in every aspect of our work and life. Especially in recent years, all walks of life have
focused on the massive data mining and application, which reveal that the era of Big Data has
come and is menacing . This trend has integrated into every work of enterprise management,
including human resource management. HR needs to face a variety of reports, and a large
number of personnel resumes and statistics. Only depending on these traditional information
management systems, it is hard for HR to predict future human resource unit movements,
employees growth curve and employee turnover intention effectively. However, if HR could
refer to the Big Data philosophy and continue to explore Big Data management, human
resource management would be more accurate, efficient and objective.
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Just like most emerging concepts, researchers havent achieved unity about how to define Big
Data. But by comprehensive many scholars definition of Big Data, author discovery that
there are five adjectives can describe Big Data well. These adjectives are massive, high
growth, diversification, new approach, a more convincing result.
Although scholars hold different views about the definition of Big Data, but they have unified
understanding that Big Data has four basic features: Volume, Variety, Velocity, and Value
(low density data value). This is so-called four V characteristics .
2.1. Volume
Large-scale is the most basic features of Big Data. In recent years, there are three main
reasons for the surge of the amount of data. The first is the popularity of the Internet, which
makes data acquisition and sharing become more easily. The second is the substantial
increase in capacity of data acquisition of every kind of sensor, which makes people acquire
more real and more comprehensive data. In addition, methods and concepts of individual data
processing has experienced a shift from relying on sample data to analyze the overall tend to
using the overall data to analyze directly, the difference between these two methods is
enormous.
2.2. Variety
The complex data type is an important characteristic of Big Data. In the past, although we
had the huge amount of data, but most of them are structured. Accordingly, the data
processing methods we need are fixed. But with the rapid development of the Internet and the
sensor, we acquire more and more unstructured data, which is just the one the Big Data needs
to focus on. This kind of data is minority and it makes traditional data processing face
enormous challenges.
2.3. Velocity
With the rapid development of information acquisition and dissemination technology, data
volume grows rapidly and new data emerge every moment. Fast-growing volume of data
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requires faster data processing speed. Be-cause only faster data processing speed can make
large amounts of data be effectively utilized. Otherwise, the proliferation of data will become
a burden to solving problems. In addition, the value of the data over time de-creases rapidly.
And if the data has not been processing effectively, they will lose value. At the same time,
Big Data makes no sense.
While the large scale introduction of unstructured data helps us retain all the details of the
data, it introduces a lot of useless information, sometimes even wrong information. So
compare to structured data, unstructured data has low value density. However, just as the
value of the data is relative, the discretion of the density value is rel-ative also. Sometimes an
insignificant detail data may cause a huge impact
In modern world, competition among enterprises is the competition of talent, and recruiting
talents for
Traditional recruitment usually follows the steps below: First, sector heads report demand for
talent. Second, the recruitment message will be posted on the corporate portal. Then, when
the applicants found the message and were interested in it, they would submit their resume.
After that, HR would select applicants resume and interview appropriate candidates till they
find the person they want. During the selection process, in addition to education, gender,
profession and other hard targets, interviewers experience played an important role. But the
reality shows that the results are often biased. Because most of the time, the interviewers
couldnt acquire comprehensive information about candidates. The information they attained
always from the candidates description. This kind of one-sided and false information leads to
the deviation of the results. But now, the Big Data can be well compensated for it. First of all,
Big Data provides a broader platform for enterprises recruitment work, which is the Internet.
According to statistics, China has more than two-thirds of enterprises use online recruitment .
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Company integrates recruitment into social net-working, and constantly gathers resume
information and application information, which laid a solid foundation for the Big Data
analysis of recruitment. Moreover, even when companies dont need recruitment, they can
also gather information about the candidates persistently. In addition, the combination of
social networking sites and recruitment can help recruiter find more information about the
candidates, including personal video picture, living conditions, social relationships, ability
etc., so that the candidates image become more vivid and achieve accurate person-post
matching . Of course, during this period of time, the candidates can learn recruitment
process information more open and transparent, as well as their degree of compliance with
job offers. This can be described as a win-win.
As we all know, staff training is an important part to ensure the sustainable development of
enterprises. Successful talent training can increase employees level of knowledge and skill,
enhance their work performance . So that enterprises can keep their advantages of human
resources in fierce competition and increase their profitability finally.
learning effect. And after a certain time, based on the learning data, the software can also
predict an individuals possible improve point . In addition, to keep abreast of staff mastery
of new skills, managers can monitor employees learning situation in the background.
Talent assessment as the current human resource management expertise has been more and
more valued. Currently, the majority of personnel evaluation take the forms of expert
assessment, comprehensive evaluation etc., but these methods are very subjective. Given
this, researchers have studied a number of issues with Big Data technology, including
personnel performance evaluation, personnel selection and classification research . Based on
the finding of these studies, the evaluation methods have been improved. These provide new
tools and methods for personnel work. To build competency model, for example, the
traditional model of building competency required a series of processes, including
interviews, coding, questionnaires, statistical analysis, and so on. Now under the guidance of
Big Data thinking, companies can build huge employee data system and use of modern
information technology to calculate the difference between the performances of outstanding
employees and is adventure employees accurately . These distinctions may be because of
technical expertise, personality, or even the physiological indices. This will likely
revolutionize the construction mode of competency model, making the post competency
features become the standards of selection employees. On this basis, rely on Big Data,
human resource management system can continue to enrich talent evaluation and
competency analysis tools to play out the wisdom of employees and human resource.
The pay level of a company is always the most important indicator that attracts employees,
and obtaining salary is absolutely one of the ultimate goals of employees to participate in the
work, but for enterprise managers, pay and performance are effective means by which to
motivate employees to work harder and harder. However, the reality is that almost every
enterprises pay system is facing problems, and performance system as its basis is
experiencing the same fate. The accounting practice is also a complicated work . Traditional
performance sys-tem often focus on more qualitative and less quantitative terms and pay
level is out of touch with performance results. The salary cant reflect differences between
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high performance employees and low performance employees that resulting in a diffusion of
responsibility. Even if company has applied KPI performance mode, its hard for HR to do
the daily performance appraisal. Moreover, to select comprehensive and fair index as KPI is
also difficult. Eventually, many companies KPI become a dummy. While under the
influence of Big Data thought, companies can record the daily workload, specific content of
the work and the task achievement of each employee, then use cloud computing processing to
analysis these data . Finally, according to pay performance standards, wages can be
calculated automatically. With computers to achieve these operations can not only improve
work efficiency, but also can reduce business investment in human capital.
Under the background of the era of Big Data, individual career choices and planning is also
closely linked with the data. By quantitative analysis of all the information that we can get of
employees, including their interest on job, promotion will, professional experience and
performance, career planning books and other data, HR could understand employees career
interests better and provide better assistance for employees career planning and
management. Enterprises can combine the traditional career management with career
management of Big Data, take full advantage of these two ways to explore the employees
career path, provide personalized career guid-ance, finally reduce the employee turnover and
achieve the win-win situation between enterprises and employees.
As mentioned above, there is no doubt that Big Data theory and technology have their own
advantages, but eve-rything has pros and cons. In fact, Big Data is still in the development
stage, and its related concepts, techniques, methods are far from mature [11]. So HR also
faces a variety of challenges in the use of Big Data. Combined with its own characteristics,
there are three points should be noted.
Because of the advantages of Big Data, so many people think that Big Data can solve all
problems. But there are many indications suggest that the current Big Data still cannot
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completely replace traditional structured data, because compared to the validity of structured
data, unstructured data is not dominant. Especially for some spe-cific applications, structured
data is still dominant. Of course, for some industries, such as the Internet, using Big Data
analysis can effectively handle huge amounts of data, analyze user needs roundly and
optimize the product. But for the traditional structured data-intensive applications, traditional
data processing methods can deal with these structured data well. So it is not necessary for
these applications to use Big Data technologies [11].
Specific to the human resources work, if problems can be solved by traditional structured
data, HR dont need to use Big Data technology. Because it has never been the best way, only
have the most suitable method. HR professionals must understand it.
While the development and application of Big Data do good to mankind and the
organization, it makes personal privacy and trade secrets exists the danger of being violated.
Data security situation is not optimistic. According to IDC statistics: In 2010, there was only
less than one third data is of the need to protect, but by 2020, this pro-portion will exceed to
two fifth. In emerging markets in Asia and South America, the lack of data protection is more
serious .
with the rise of e-commerce and social networking, more and more people leave with a lot of
personal information on the network. Although the company can analyze employees by
obtaining this information, but if they used improperly, it is likely to infringe the privacy of
employees and cause huge losses to employees. Once the personal data footprint is gathered
and analyzed, it would be easy to obtain personal information. But in fact, it is very hard to
keep the information from exposure because of the data release mechanism on the network .
The situation put forward higher requirements to the enterprise network security system.
In the era of Big Data, people think the data is not static and stale, but flowing and updating.
Big Data is the source of human knowledge and society value, and through Big Data analysis,
we found more valuable potential correlation, from which we can predict the direction of
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specific things. However, we must be clear that the conclusions that come from data do not
necessarily reflect the true. Because with the increase of the amount of data, it may bring
some wrong data, making the data value reduce greatly and even draw the wrong conclusion.
In addition, the macro conclusions acquired by Big Data analysis, dont make sense for some
micro issues. Such as a coin toss, the more times we throw, the closer for us to obtain a
positive or negative. But no matter how many times it has thrown, we still cannot analyze
that we will get a positive or negative the next time. Therefore, we cannot hope to be able to
predict all from the Big Data.
5. Conclusion
In summary, while Big Data provides new methods and ideas for HR, there are inherent
drawbacks. HR needs to make full use of the advantages of Big Data and try to avoid its
disadvantages, so that Big Data can service companies and human resource can worker
better.
References
5.
LaValle, S., Lesser, E., Shockley, R., Hopkins, M.S. and Kruschwitz, N. (2011) Big
Data, Analytics and the Path from Insights to Value. MIT Sloan Management Review, 52,
2.
6.
Ma., J.G. and Jiang, W. (2013) The Concept, Characteristics and Application of Big
Data. National Defense Science
Technology,34, 10-16.
7.
Huang, S.L. and Xiang, J. (2013) Big Data Light up Wisdom of Human Resources
Management System. Science& Technology for Chinese Mass Media,12, 76-78.
8.
Dong, X.H., Ying, A. and Guo, J.G. (2014) Research on the Application of the Big Data
Technology in the Network Recruitment. Human Resource Development of China, 18,
37-41.
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Abstract
The paper speaks about the retail sector growth and the usage of big data in the retail
sector by the major companies. In India or any country it is the retail sector which is very
quick adoptable to change and changes its style and nature of business according to the
technology. My paper speaks about the growth of both E-tailing and retailing with the big
data analytics like Hadoop databases which enables them to understand the customer
preferences and promote their products. Companies like Oracle, Intel and Dell are some of
the big players in the big data analytics.
Keyboard
POS transactions, Hadoop database, MAPR converged data platform, Click stream analysis
RETAIL SECTOR
The word retail means the sale of goods or commodities in small quantities directly to
consumers Retailing can be defined as a distribution channel function, where an organization,
buying the products from supplying firms or manufacturing the products themselves, sells
these directly to consumers.
The size of Indian retail market in 2010 was US$ 353 billion and by 2014, it is US$
543 billion .Further, the estimated value of current size of Indian retail market is about 500
billion USD and by 2020 its value is pegged to be at 1.3 trillion USD. Over 20 per cent of
India's gross domestic product (GDP) is contributed by retail sector and in total employment
it contributes eight percent.
Optimism about high potential of growth in organized retail in India has also been
shown by Equity master. The views expressed here indicate that in past, a large part of
Indias consumption needs was accounted by food but now transition is taking place from
traditional retail to organised retailing due to changing consumer expectations, demographic
mix, etc. The new generation appreciates mall culture which makes it convenient to shop with
multiplicity of choice under one roof (Shop- in Shop). Over the long run, these are expected
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to be the growth drivers of organised retailing in India. Further, FICCI states that despite the
downturns, , the organized retail market in India is growing exponentially due to growing
consuming classes resulting from economic growth and organized retail is attracting more
and more existing shoppers into its open doors. By 2015, organised retail segment is
estimated to grow (at a rate of almost 30 %,) at a much faster pace than the overall retail
market which is forecast to grow by 16% in the same period. The Governments initiative to
allow 51 per cent foreign direct investment (FDI) in multi-brand retail has been a subject for
debate for quite some time now. Indian retail sector has therefore attracted the attention of
people from various fields including academia, industry, research organisations etc.
II.
2.1
The total retail sector in India can be divided into organized and unorganised sectors. The
trading activities undertaken by licensed retailers are categorized as organized retailing.
Retailing is one of the most prominent industries in developed markets whereas in developing
economies the concept had occurred much later. In developed economies, organised retail has
a 75-80 % share in total retail while in developing economies it is the un-organised retail that
has a dominant share.
The Indian retail sector is highly fragmented. More than ninety per cent of its business
is being run by the unorganized retailers like the traditional family run stores and corner
stores. The organized retail in India is at a very nascent stage. However, in order to increase
its share in total retail, attempts are being made so as to bring in a huge opportunity for
prospective new players. India's retail sector is heading towards modernization. New formats
such as departmental stores, supermarkets and speciality stores, Westernised malls are fast
appearing in metros and tier-II cities.
The experience of shopping has changed dramatically in recent years as power has
shifted to consumers. Shoppers can easily research and compare products from any device,
even while walking through a store. They can share their reviews about retailers and products
through social media and influence other prospective customers.
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To compete in this new multi-channel environment, retailers have to employ new strategies to
attract and retain customers. Big data and Hadoop enable retailers to connect with customers
through multiple channels at an entirely new level by harnessing the massive volumes of new
data available today.
The MapR Converged Data Platform helps retailers store, integrate and analyse a wide
variety of online and offline customer datae-commerce transactions, clickstream data,
email, point of sale (POS) systems, social media and call centre recordsall in one central
repository.
Retailers can analyse this data to generate insights about individual consumer behaviours and
preferences, and offer personalized recommendations in real time. Key to this is the ability to
optimize merchandise selections and pricing that are tailored to individual consumers likes
and dislikes.
RETAIL USE CASES
Below are a few use cases that illustrate how big data and Hadoop are being leveraged by
retailers to develop closer relationships with customers, be more competitive, and create
entirely new kinds of shopping experiences.
Up-Sell/Cross-Sell Recommendations
Providing up-sell and cross-sell recommendations to customers is the mostly widely adopted
big data use case in the retail sector. This enables retailers to increase online purchases by
recommending relevant products and promotions in real time. Retailers can recommend
products based on what other similar customers have boughtproviding upsell, cross-sell or
next best offer opportunities. The MapR Converged Data Platform provides real-time
capabilities that enable recommendations to be delivered at the right time and place to the
right device. It can also improve customer loyalty by providing a more relevant, personalized
online experience. Recommendations can benefit from a much broader context, not only
checking which combinations are most likely, but also, based on a very fine-grained "graph
analysis," identifying a closely related peer consumer group.
Social Media Analysis
Consumers can use social media to exert tremendous influence over a retailers brand or a
products success. Retailers need to monitor online sentiment and respond in real time with
relevant messages or offers. The MapR Converged Data Platform allows for real-time
ingestion of streaming data that helps retailers get the information they need fast. Retailers
thus gain insights into consumer behavior and social relationships by analysing not only their
online behavior and prior transactions but also social network activity. They can aggregate
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multiple streams of unstructured social media data and user-generated content across multiple
channels.
Dynamic Pricing Across Multiple Channels
When consumers are able to shop across multiple channels in real time, slight differences in
pricing can make a difference in their purchase decisions. Dynamic pricing across multiple
channels is not new, but big data allows for a more refined set of indicators for price elasticity
in comparison with traditional influencers such as time and availability. Other indicators
include the weather, the location, the complete buying profile and social media presence of a
customer. The MapR Converged Data Platform allows retailers to build models that take into
account these additional variables and incorporate them into real-time pricing strategies.
Fraud Detection
Retail fraud can range from fraud in returns or abuse of customer service, or credit risk for
larger purchases, based on, for example, uncovering fraud rings, social media activity of
customers and detecting patterns. It can also be major security breaches putting private
customer information at risk. Retailers need to protect their margins and their reputations by
proactively detecting fraudulent activities. The MapR Converged Data Platform can help
retailers identify anomalies and patterns by putting in place continuous monitoring tactics that
look for unusual patterns in product and inventory movement. This can help indicate
incidents of fraud such as shrink and store associate theft and look for exceptions. Over time,
models can be built that utilize machine learning and provide more predictive capabilities that
can trigger actions when exceptions are encountered.
Clickstream Analysis
Retailers can increase website revenue and create more engaging customer experiences by
analysing consumer clickstreams. MapR can help retailers capture, analyse and gain
actionable insights from data across multiple channels including search, ads, email and web
logs. By analysing clickstreams they can better understand how consumers make online
purchase decisions and then optimize web pages/offers to increase conversion, and lower cart
abandonment. The MapR Converged Data Platform accelerates analysis cycle time and rapid
actions: ingests data faster, enables streaming writes to update models and target customers
quicker.
Loyalty Program Benefits
Big data extends the channel reach of loyalty program benefits from point of sale, Web and
call centres to mobile and social capabilities. Customers can accrue rewards by more than
purchases; rewards can be earned for being good product or brand ambassadors or through
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social relationships. The MapR Converged Data Platform can help retailers capture, analyse,
and report on individual customer activity over time, enabling them to provide personalized
and differentiated attention to their best customers.
360 Customer View
Retailers can improve customer satisfaction and sales opportunities by integrating all relevant
customer data across online transactions, POS transactions, social media, and customer
service interactions into one single view. The MapR Converged Data Platform can be used as
an Enterprise Data Hub to combine these various sources of data into one repository and
obtain that single view. Customers use email, chat and social media to communicate on an
everyday basis. Getting a handle on not just their prior transactions but also likes and dislikes
about their experiences is critical. Retaining customers is a key metric for retailers, given the
cost of acquiring new customers.
Big Data, being the next trendy thing in IT space is a new terminology which has
come up. It is described as an exponential growth and availability of data both in structured
and unstructured forms, which is defined by its volume, velocity, variety, variability and
complexity.
With the advent of cloud, there was lot of confusion in Big Data. Many of the
database vendors and firms tried to put all data in one or more databases considering the fact
that it would solve the Big Data issue. However, its not big, but large data not properly
segmented and segregated, which needs to be addressed through database federation, and
standard business intelligence and analytics.
Therefore, over a period of time, the demand of Big Data has raised, by Fortune 1000
companies, Government bodies, and SMEs. It has various benefits, which are not limited to
understanding the fact that big data is not a single technology, technique or initiative, but how
we can utilise the data for improving the business service and solution. Simply put, it can be
done by harnessing relevant data and analysing it to find answers that enable cost and time
reductions, new product development, product offerings, smarter decisions, etc.
In the current scenario, Big Data also has its own challenges which need to be tackled
using innovative and smart methods. It needs to resolve the issues like analysing, capturing,
curating, searching, sharing, storage, transferring, visualising and privacy violations. A need
to segregate and segment big data in smaller segments becomes a priority to get better results
and reports for studies and scope for improvisation. Businesses nowadays are generating
much more data more than what their systems were designed to handle in terms of volume.
1005
Providing Excellent Customer Service is critical for the success of any business, but
seems a bit of a challenge due to multiple communication mediums which need to be
processed as one to provide a rich customer service solution and make the customer
feel valued in a quicker resolution.
Detecting Fraud should be a top-most priority, but requires the right infrastructure.
The business needs to detect fraud in real time.
Customers Need to Know the Exact Availability, status and location of their orders.
This can get complicated if there are multiple third parties involved in the supply
chain. It can be resolved by providing a platform to connect commerce, warehousing
and transportation functions all integrated as one.
Predictive Analysis is crucial to all retails. Regardless of size, its difficult to sustain
business without any analytics. Through predictive analysis businesses can identify
events prior from occurring and help in avoiding any issues which might create losses.
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will face a shortage of about 190,000 Data Scientists by 2018 and, then, a shortfall of 1.5
million managers and analysts who can understand and make decisions using Big Data.
In India, there is a huge demand for offshore analytics work. The size of analytics
market will evolve to 1/3rd of the current global IT market, but the skill-sets and scarcity of
analytics talent would be limiting its growth. Data Scientists who can perform analytics and
analytics consultants who can understand and use data will be far less than required, and
hence, there would be a need for quality and quality assessment due to which India is going
to be short of at least a million data consultants.
The need for talent is growing at a steady pace, but nothing significant is happening
on the supply side. Institutes need to create an ecosystem for learning and experimenting with
Big Data in a simple, yet sophisticated manner.
On the positive side, Big Data will not only help companies in making strategy
decisions, harnessing all enterprise data analytics resulting into stronger business, but also
will be able to manage data better to make all the clustered data structured. The structured
data will be easier to manage; it will help in quick operations and analytical workloads,
increase competitive advantage with flexibility of data used in business services, etc.
1007
sector. The computer and electronic products and information sectors, as well as finance and
insurance, and government are poised to gain substantially from the use of big data.
There will be a shortage of talent necessary for organisations to take advantage of big
data. By 2018, the United States alone could face a shortage of 140,000 to 190,000 people
with deep analytical skills as well as 1.5 million managers and analysts with the know-how to
use the analysis of big data to make effective decisions.
Several issues will have to be addressed to capture the full potential of big data.
Policies related to privacy, security, intellectual property, and even liability will need to be
addressed in a big data world. Organisations need not only to put the right talent and
technology in place but also structure workflows and incentives to optimise the use of big
data. Access to data is criticalcompanies will increasingly need to integrate information
from multiple data sources, often from third parties, and the incentives have to be in place to
enable this.
STAPLES
Fortune 500 offices and school supplies retailer Staples increased its brand recognition and
boosted staff efficiency by improving social media listening and analysis, and reducing
noise (i.e. irrelevant data) by 75 percent. Staples needed to reduce the noise it collected
from social media channels to understand customers likes and dislikes more quickly, and
improve its offerings. As more people engage on social media channels such as Twitter,
Facebook, LinkedIn and others, Staples realized that it needed a better solution to sift through
the increasing volume of public data to find tactical information.
The company engaged Dell Services to deploy and manage a cloud-based social media
listening and analysis service centred on big data technology. The solution served to pinpoint
relevant unstructured data from social media insights faster, increase customer
communication, amplify customers voice in day-to-day decisions, and improve corporate
agility and offerings.
The results of the project were widespread. Marketing managers could quickly gauge whether
media campaigns were effective and worth the investment. The website team could learn if
customers were able to easily find the products and information they were looking for on
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Staples.com. Plus, executives would be able to easily see which store policies and processes
are working, and which ones need improvement.
MetaScale
MetaScale provides Hadoop big data solutions, training and supportpartnering with Dell
to help clients speed processing, improve decision support and realize more cost-effective
ways to derive intelligence from enormous data stores while radically reducing costs.
MetaScales first client was one of North Americas largest retail groups, with many
thousands of stores and tens of billions of dollars in annual sales. Its daily transactional and
operational data volume is several terabytes, generated by millions of shoppers as well as
many supply chains. In all, its current data volume exceeds 3 petabytes. The high level goal
of the project was avoid the situation where its data management, analysis and reporting
capabilities were quickly falling behind the pace of growth of its data.
As one example of where the big data project succeeded, the client companys pricing
business unit needed daily summary reports using data from multiple platforms to measure
the effectiveness of its pricing in stores. It was generating these reports from its data
warehouse and predictive analytics tools, both hosted on mainframes. But the mainframes
batch processing required for these reports was taking 10 to 15 hours, so the company could
manage only weekly data warehouse loads. As a result, the pricing business unit wasnt
getting the decision support needed to fine-tune in-store pricing.
MetaScales approach to solve big data problems for its client was to deploy a Hadoop
solution powered by MetaScale big data appliances based on Dell PowerEdge servers.
MetaScale worked closely with Dell to develop its bundled Hadoop solutions to meet its
clients growing needs for performance, scalability and support. MetaScales big data
appliances arrange the server nodes into logical clusters for handling large-scale data sets
cost-effectively. The retail clients Hadoop solution had a cluster with more than 500 server
nodes, not counting its backup cluster.
In this particular clients Hadoop implementation, MetaScale helped its client achieve an ROI
in just three months after becoming operational with a cluster that, at the time, harnessed 50
nodes of Dell servers to manage its growing data.
References:
http://retail.franchiseindia.com/article/technology/back-end/Big-Data-in-Retail-OtherObservations.a3054/#sthash.Lss3f5kW.dpuf
http://insidebigdata.com/2015/09/30/the-future-of-big-data-and-retail-with-case-studies/
1009
http://iosrjournals.org/iosr-jbm/papers/Vol16-issue4/Version-1/J016417281.pdf
http://www.cci.in/pdfs/surveys-reports/Retail-Sector-in-India.pdf
1010
technological advances necessitated by various changes in the world together with the
internet which has revolutionized not only the social networking scenario but also the way
commerce is carried out i between individuals and nations. This paper tries to explore the
one facet of the technological revolution that has which has literally become a hand tool for
all consumer which is the app. Apps is the short form for applications which service provider
uses to showcase its goods or services. Apps have become handy tools, as they are mobile
compatible and have raised questions about doing business on internet using laptops, tablets
and other devices. This paper is a conceptual one which explores the extent to which the apps
have entered lives of consumers and businesses alike. To take a note some of them have
almost become indispensable.
Keywords: Innovation, apps, cloud computing, digital marketing, e-commerce, Digital
Marketing, Mobile Marketing.
App is self-contained programme thats designed to perform a specific function .It is the
shortened form of application especially a downloadable one by user to a mobile device. In
other words an application especially as downloaded by a user to a mobile device says the
oxford dictionary33 . According to Wikipedia34 an app can also be called as mobile app, web
app apart from the usual application software. These app have revolutionized the way that
they are doing with the customers .Apps or applications are mobile software for Android or
smart phones that have come to revolutionized the way business is done in the world today.
The e-commerce boom which people thought would fizzle out had consolidated itself and
paved way to the new form of business with smart phones the APP. Within a few years of its
introduction have come to stay the apps had a modest start with small games, texting, clock,
radio, calendar, calculator and other features that were included in all phones. With the smart
33
dictionary.com/definition/English/app
34
https://en.wekepedia.org/wiki/app
1011
phones the features were taken over by softwares which become application using cloud
computing software .The cloud computing software is the immense amount of date stored as
referred to as by data. The apps then became serious business. The new generation with the
way they need information and the quickness of information, found the app a very smart
choice. The apps is the fastest adoption of innovation that the world has seen in recent years.
The diffusion of this innovation has been unprecedented.Usage of mobile apps has become
increasingly prevalent across mobile phone users.35
APP MAGIC:
APPS have created magic and in May 2012 comScore study reported that more than the
previous quarter the subscribes used app than browsed web on their devices.51.1% vs. 49.8%
respectively.36To look at the way the apps has created magic the market research firm has
predicted magic that there are 102 billion apps that could be download in 2030.The research
firm Gartner predicted that 102 billion apps could be downloaded in 2013 91 of them are free
and they would generate 26 billion in US upto 44.4% on 2012 US 18 billion. .One of the two
contributor of the app revolution has been goggle play and apple stores these two generated
around 5 billion $.In order to strong as possible in todays business world the companies have
to make their online presents as possible. The digital marketing scenario calls for great
models and the mobile app is one of the most important ingredients in digital marketing as
well as mobile marketing. Customers are increasingly demanding to interact with companies
any time any where.
Characteristics of Modern Apps: As explained in the following figure that was given by
Microsoft, one can understand the characteristics of modern Apps.
The modern Apps consist of the following
1. People
2. Apps
3. Cloud computing
4.Data volume
5.Rapid evolution
6. Devices
7. Natural User Interactions
35
Lud wig,sean.December 5,2012.venture beat.com,study,Mobile app usage grows 35%,TV web not so much.
Perez sarah,july 2 2012 comS core :in the US mobile market,Samsung anroid top the charts:apps overtake
web browsing.urch.com
36
1012
1013
Apple store which have lead all the other applications. Top mobile applications in India have
been whatsapp followed by facebook.
CONCLUSION: The apps have come to stay in a big way and they will transform the way
business is performed and whether small or big an app proves to be an important
technological come to cal transformation for a business firms, better customer experience
followed by customer retention has been a fact with an application..Apps has also been
responsible to increase customer base .The above mention author Microsoft have pointed out
that full experience on every app in expanding market reach and improving business
performance has been a key performances factor of modern app. One can conclude that the
app has come to stay and may to surpass all other technological innovation in the long run.
References:
www.oxford dictionary.com/definition/English/app
P.Weill,SL
Woemer-MIT
Sloan
Management
Review,2012-
Nine
business
scenarios
for
modern
ArnoHarteveld,Architect,Microsoft
apps
in
Services,Robert
the
enterprise-
Microsoft
Standefer,Architect,Microsoft
Services
Kim,Ryan.Multi-screen
mania:how
our
devices
work
together.Gigaom,Aug.29,2012
http://gigaom.com/2012/08/29/multi-screen-manai-how-our-devices-work-toghether/
www.internetworldstas.com/stats.htm
http://bgr.com/2012/02/15/cisco-mobile-connections-to-hit-10-billion-by-
KritikaDadheech
Assistant Professor
Department of Management Studies
Dr.Ambedkar Institute of Management Studies, Bangalore
Email kritika.joshi87@yahoo.co.in
+91 8277603697
1015
1016
All management students who are on the road of success must read books. One of the most
important characteristics of leadership is that the golden words of different good authors
should be imprinted in the minds of the aspirant. This will not only make him a successful
person but also a complete individual.
Adolescents entering the adult world in the 21stcentury will read and write more than any
other time in human historyThey will need literacy to feed their imaginations so they can
create the world of future.
Objectives of developing reading skill
1.
2.
3.
4.
5.
6.
7.
8.
Gray stated complete reading involves recognition, understanding and integration. There is
a pedagogical reason to inculcate reading habit as the veracious reader becomes good writer.
Writing Therapy:
The foremost important quality of an efficient manager is the precise expression of the
situation with an excellent articulation. The spontaneous flow of writing needs practice. All
the great writers in the world recommend the writing therapy. In this process the beginners
should write minimum 3 pages a day. It should be practiced in terms of freedom of
expression without any deliberate efforts just follow the thought process as it occurs and pen
down all thoughts spontaneously. As it gives the way to thousands of thoughts every day to
come out of the mindor else they could have been died in the mind itself. Writing therapy
brings out the best out of the mind of the individual who religiously follow the practice. At
academic level it should be encouraged in the colleges.
Use of technology:
Technology is an integrated part of the Management Studies. To make management study
more innovative the power point presentations can be used for all theory classes in order to
save the time. However the retention of visuals is better than oral communication. Subject
experts should collect some videos related to their subject and play those videos along with
1017
the theory. In this correlation the real purpose of management education will be fulfilled.
There must be a mike in the classrooms so that students can give presentations to the
classmates and recording should be done however later that recording should be critically
examined by the presenter himself to check the body language and voice intonations. Such
exercises will build a confidence in the student and the required corrective action will be
taken at the right stage. Improvement is possible through listening, producing correcting and
practicing with technology. Management studies can be innovative only by integrating
pedagogy and technology.
Observation:
Observation is a multi-faceted instrument for management erudition. Observation includes
preparation, selection of a focus, purpose along with the actual spend time in data collection.
Observation skill can be improved by practice. The management students should be trained in
observing skill by giving the practice of prioritisation among variety of co-occurring
experiences. They should be given the practice of making a list of priorities in four catagories
1. Most Important and Most Urgent
2. Most Important and Urgent
3. Important and Urgent
4. Not Important and Not Urgent
This is the most important aspect of management which can be funnelled, practiced, cultured
and upgraded.
1018
HEAD
THINK
THINK WELL
CARES WELL
WORK WELL
CARES
WORK
HANDS
HEART
The above mentioned diagram comprises three functions whichshould be in sink- if the head
will think good thoughts along with the good heart which cares for values the hands will
execute the work in excellent manner. This basic combination should be taught to the young
generation who tries to run after the success and wants everything in life instantly. They
should be taught the law of nature that what we sow we reap.
It is possible that all students in the class achieve the same sort of success in life but at the
same time it is duty of the teacher to help them in making them learn how to learn theoretical
lessons as well as the lifes practical lessons. Tyacke and Mendelsohn said aptly Each
individual will have a unique way of dealing with realityand processing information.
Self-Directed Learning
Learning to learnis a crucial skill. A self-learner is the person who can judge the requirement
of expectations of the subject and of individual himself. The quality innovative education
system should be develop in such a way to make student ready for making his own plans to
study effectively. It is required to follow the natural process of psychological development.
The new education system should make students responsible to deal with new initiatives. The
includes the analyses of problem an insight to judge what needs to be learnt and person
should know where to access for what problem and how to handle the problem
Merriamemphasised the fact that the self-directed learning in higher education is both a goal
of education and the process that leads to successful learning.
1020
1.
2.
3.
4.
5.
6.
7.
Word Smart
Number Smart
Picture Smart
Body Smart
Music Smart
People Smart
Self Smart
Critical Thinking
Critical thinking is a substantial aspectcontributing to innovative quality education. Graham
Sumner Critical thinking is a product of education and training it is a mental habit and
power. Critical thinking includes evaluative, meditative, instinctive and innovative thinking.
Some of the techniques to polish critical thinking like role playing, impromptu, Socratic
Method of questioning should be used to infuse critical thinking in innovative quality
education system. The teacher should also prepare the lesson plan in more structured format
that which module needs what technique to bring out the critical analyses of the topic
covered. The plan should include the end to end required preparations, execution dates and
also reward and recognition for any significant achievement of any student.
Critical thinking is cultural thinking so to have overall grooming of personalities families
involvement is equally important. Parents should know the higher education culture by
visiting to colleges occasionally. As now a days due to professional higher level education
students are away from native places. They may adopt the new environment but parents
sitting away cannot understand the emotional disturbance of the child.In innovative quality
education we need to ensure the change should happen in society as well through each
student.
Emotional Intelligence
Emotional Intelligence is the most critical humanistic skills and competency. EQ
development help individuals in understanding their own competency as well as others
interests, habits, preferences. This understanding of self and others facilitate collaborative
learning. Alfred Lord Tennyson in Ancient Sage said aptly, The shell must break before the
bird can fly which mean the education system should helping student to be open minded.
Individual emotional intelligence should allow him to restructure and modify the old stuff by
removing the personal blinders. The student should be ready for extension of learning.
1021
Competencies like collaborative spirit, self-control will make the person emotionally
intelligent.
Unconscious Competency:
Management education should be innovative so the it can be infused with the students
creative mind. There are four stages of learning:
UNCONSCIOUS INCOMPETENCE
CONSCIOUS INCOMPETENCE
CONSCIOUS COMPETENCE
UNCONSCIOUS COMPETENCE
The first stage where a student is unaware of the skills, he enjoys the ignorance. The second
stage he becomes aware of different skills and finds himself incompetent. Third stage where
he puts efforts to become competent may be demotivated due to multi-dimensional pressures.
Our quality education should focus on developing the skills unconsciously which should
come freely and spontaneously.Innovative quality education system should prepare them
mentally and intellectually.
Conclusion
Thus pedagogical approaches in teaching management can make studies more innovative.
Habit of reading sow the seeds of creativity writing therapy brings the power of expression,
Use of technology make the student efficient, Observation and communicative approach to
soft skills make head, heart and hand work in synchronisation.mixed ability classes
encourage Self-directed learning and help students to polish multiple Intelligences.Critical
thinking makes the student emotionally intelligent. Innovative quality education system
should focus on unconscious competency to prepare them mentally and intellectually great
persons.
References:
1. Candy, P.C .(1991).Self Direction for lifelong learning. San Francisco: Jossey-Bass
2. Garrison, D.R.(1992). Critical thinking and self-Directed learning in adult education:
An analyses of responsibilities and controliGremmo, Marie-Jose. & Riley,
Philip(1995). The History of an Idea System, No. 23, 151-164.
1022
1023
LAKSHMI V
RESEARCH SCHOLAR, TUMKUR UNIVERSITY, TUMKUR -572101 AND
LECTURER, AIGS, BANGALORE UNIVERSITY.
INTRODUCTION
Food is the necessary thing for a human being like fuel to run a vehicle. Food gives us
energy to work, think and other activities which we can do in our day to day life. The food
habits have been changed from traditional food habit to modernized food habits due to
globalization. Due to economic reforms since 1991, New Economic Policy (NEP) has been
introduced in our Indian economy. One among the three important features of NEP is
Globalization.
Globalization is the outcome of the policies of liberalization and privatization. LPG policies
have been made remarkable changes in the world economy. Therefore, the world economies
are moving form protectionism to liberalization, from nationalization to privatization, from
licensing to de-licensing, from controlled mechanism to market mechanism, and from
socialist inclination to capitalist inclination.
REVIEW OF LITERATURE
Ms. Namrata Sewa Lala (2004) made an attempt to examine whether globalization has in
the true sense affected the Khasi sustainable ways of life, their food or their culture.
1024
_________________________________
Hubacek, K., Guan, D. and Barua, A. (2007) conducted a study to analyze how the major
drivers did contribute to the environmental consequences in the past, and take a forward
look to the environmental impacts based on the changes of these driving forces in China
and India.
Sitou Akibode and Mywish Maredia (2011) conducted a household level survey on
Global and Regional Trends in Production, Trade and Consumption of Food Legume
Crops.
The main purpose of this conceptual research is to focus on globalization and its impact of
changes in food habits. It may be positive impact on society or negative impact on health and
culture.
During the entire human history populations have experienced changes in ecological
relationships that have modified their diet and physical activity. Early human populations
were hunter gatherers.
However, there was a dramatic shift to domestication of plants and animals for agricultural
food production about 10,000 years ago.
population size and density increased significantly. It was assumed that the abundance of
food would have led to a better nourished and healthier population with a reduced rate of
mortality and a continuous and steady increase in population size. This leads to an increase
in infectious and nutritional disease rates due to human waste and domesticated animals.
solution to some of the problems of urban as well as rural living. There is freedom of entry
both as employees or entrepreneurs.
Franchisor has to expand only the resources to recruit, train and support
franchisees. And strategy should match to local market needs. Therefore, competition for
market share of food purchases increases the entry of large multinational fast food and
supermarket chains in the market.
multinationals will become small local agents. FDI in markets of developing countries as the
main economic drivers influencing changes in food supply and diet.
6. Introduction of supermarkets
1027
The supermarkets bring significant improvements in standards of food quality and safety at
competitive prices and convenience. When there is an increase in the households income,
due to increase in the employment opportunity that leads to change in lifestyle. Therefore,
supermarkets attract customers to purchase ready made foods.
supermarket entry into retail is first to specialize in the sale of packaged and processed food,
followed by fresh or frozen meat and lastly fresh produce. The initial entry into the market
using packaged and processed food exposes consumers to exotic food items or those with a
long shelf-life such as powered milk, noodles and varieties of sweets and snack foods.
7. Impact on health
Now a days, men and women are driven into the workforce by the over riding need for an
increasing in income to pay for food, shelter, clothing and other household expenses, working
hours are often long. This leads to shortage of time to prepare food at home. Diet-related
factors such as cholesterol; low fruit and vegetable intake; and iron, zinc and vitamin A
deficiency rank among the major risk factors for decreased disability-adjusted life years
(WHO, 2002). Health problems related to diet may be caused by a limited intake of dietary
energy or micronutrients, an excessive intake of dietary energy, or poorly balanced intakes.
There are direct health consequences from nutritional deficiencies such as blindness from
severe vitamin A deficiency or mental incapacity as a result of iodine deficiency. Likewise,
diet plays a critical albeit more covert role in the development of many other diseases
including type-2 diabetes, cardiovascular disease, cancer, dental disease and osteoporosis
(WHO/FAO, 2003).
8. Impact on culture
Traditional meals and meal times are replaced by spontaneous often unplanned food
purchases on street corners.
responsibility for mean planning and food preparation for the household has fractured in most
urban environments. Increasingly it is street food vendors, cafeterias at work or school places
and child care facilities that provide family members with at least one and often several meals
per day. Thus, attention to dietary balance and dietary quality, which was traditionally,
intuitive at the household level, is now subject to wider cultural changes and external
influence.
CONCLUSION
1028
Globalization brings tremendous changes in food habits from home made food to outside
food. It has become responsible for the introduction of street food activity, supermarkets,
entrepreneurship, capital flow, increasing in the employment opportunities, and open up
opportunity for women to work in different sector and even it had adverse effects on human
beings health and culture.
REFERENCES
1. Ms. Namrata Sewa Lala IJELLH Vol II Issue II June 2014 ISSN 2321-7065,
Globalization and its impact on Indigenous food habits and culture of the Khasi
Community of the North East.
2. Helene Delisle, Ph.D., Department de Nutrition, University de Montral in
consultation with the Food Policy and Nutrition Division, FAO, Rome, 1990.
3. WHO Library Cataloguing-in-Publication Data - Globalization, diets and noncommunicable diseases - ISBN 92 4 159041 6 - WHO 2002.
4. Dr Kraisid Tontisirin (2004)- Globalization of food systems in developing countries:
impact on food security and nutrition FAO FOOD AND NUTRITION PAPER 83 ISSN 0254-4725.
5. White Rose Research Online URL for this paper: http://eprints.whiterose.ac.uk/4803/Hubacek, K., Guan, D. and Barua, A. (2007) Changing lifestyles and consumption
patterns in developing countries: A scenario analysis for China and India, Futures,
Volume 39 (9), 1084-1096.
6. Sitou Akibode and Mywish Maredia (2011) - Report Submitted to SPIA - Global and
Regional Trends in Production, Trade and Consumption of Food Legume Crops Version 3/27/11.
1029
ABSTRACT
This paper on Formula for Corporate Longevity attempts to trace the history of some
organizations, both in the Domestic as well as International arena, who have either
survived for a very long period or failed when faced with stiff competition. The paper
concludes that Innovation, Technology and Data Based Decision Making are the key
factors that constitute the Formula for Corporate Longevity.
1.0 INTRODUCTION
Innovation has become a must in all walks of life. Looking beyond what is being done
at present and thinking out of the box is what Innovation is all about.
Technology is evolving at a very fast pace. Driverless cars have become a reality and
can help greatly in preventing accidents. Technology has benefited mankind in several
ways. Organizations cannot any more keep their eyes closed on the technological
advances happening around.
Decision making has to be based on facts. Facts are information obtained from various
sources. Information is data collected at several points in an organization and processed
using computerized systems. Data in most organizations is very large and complex. Big
Data is a broad term for data that is large and complex that the traditional data
processing applications are inadequate.
1.1 INNOVATION
Innovation can be classified into Incremental Innovation, Radical Innovation and
Breakthrough Innovation. Small improvements on continuous basis, also known as
Kaizen in Japanese is all about Incremental Innovation. Bringing about improvements
on a larger scale is known as Radical Innovation. Breakthrough Innovation is bringing
about drastic changes in all the resources in line with changing situations and
requirements. Innovation can be done in Product, Process, People, Procedures or
literally in any area of an organization.
1030
1.2 TECHNOLOGY
Technological and Digital Innovation is transforming many industry sectors. Big Data
requires exceptional technologies to efficiently process large quantities of data within
tolerable elapsed times. McKinsey report (2011) suggests suitable technologies which
include Crowdsourcing , Data Fusion and Integration, Genetic Algorithms , Machine
Learning , Natural Language Processing, Signal Processing , Simulation, Time Series
Analysis and Visualization. Real or near real time information delivery is one of the
defining characteristics of big data analytics.
Chen et al (2012) brings out the fact that Business Intelligence and Analytics (BI & A)
has emerged as an important area of study for both practitioners and researchers,
reflecting the magnitude and impact of data related problems to be solved in
contemporary business organizations.
Some researchers have marked Big Data as the next big thing in innovation (Gobble
2013 ), the fourth paradigm of Science (Strawn , 2012) and also the next frontier for
innovation , competition and productivity (Manyika et al, 2011).
3.0 METHODOLOGY
The research is more exploratory and descriptive in nature. The data is collected from
secondary sources such as research papers and articles from various sites , books on
corporate longevity and company websites. The author has used convenience sampling
and picked up 28 organizations at random for further secondary research. The author
observed from the literature review
1032
A company does not need to be defined by its product. It can change. IBM moved from
being a manufacturer of computers to one that focuses on information technology and
consulting services.
Flexibility and
adaptability are
essential
for
survival.
1033
people and
Year of
establishment
1788
Bombay Dyeing
1879
Dabur
1884
Kirloskar
1888
DCM
1889
Britannia
1892
1034
Century Textiles
1897
1897
Shalimar Paints
1902
10
Tata Steel
1907
11
ITC
1910
12
TVS
1911
Year
establishment
1802
1806
1824
1837
1883
1892
1898
1899
1901
1902
1903
1906
1908
1911
1937
1939
of
A company that was making punch card machines and mainframe computers occupying
huge space today makes supercomputers that can beat human chess champions. We are
talking of IBM which has survived more than 100 years by constantly adapting through
technology shifts. Technology trends are so fast moving that many companies in the
industry tend to rise fast only to flame out. The speed of change in technology makes
longevity a challenge. IBM demonstrated a strength i.e. ability to change fast. IBM
introduced new technology from clocks , butcher scales and coffee grinders to punch
card machines and typewriters to tape storage , mainframes and personal computers
George Eastman came up with an affordable combination of roll film and camera in the
1890s and Kodak traded successfully on the back of his innovation for more than 100
years. The company knew about the coming digital revolution. In 197 5, an employee
invented a crude digital camera. But analog film remained a huge generator of cash
1035
the peak year for roll film sales was as late as 1999. Digital technology was a risky
investment in the eyes of analysts , investors and , until it was too late, most executives.
Kodak filed for Chapter 11 bankruptcy protection in 2012, emerging in 2013 , as a
much smaller business selling imaging equipments and services to businesses.
Bill Hewlett and Dave Packard decided to first start a company and then figure out
what they would make. They were opportunistic and did anything that would bring in a
nickel. HP learned humility early in life, due to a string of early failures and only
moderately successful products. Yet Bill and Dave kept tinkering, persisting, trying and
experimenting until they figured out how to build an innovative company that would
express their core values and earned a sustained reputation for great products. They
quickly made the transition from designing products to designing an organization and
creating an environment conducive to the creation of great products.
We all know who is known as the father of mass production and assembly line concept.
Henry Ford founded the Ford Motor Company in 1903 to capitalize on his automotive
engineering talent. Ford was one of 502 firms founded in United States between 1900
and 1908 to make automobiles. The famous Model T in black color launched in October
1908 is still talked about in automobile circles all over the world. With this Model T,
Ford transformed the American way of life for several million families who could start
affording an automobile. Ford reduced the price of Model T by 58 percent from 1908 to
1916. Ford redefined the sequence of the three Ps People, Products and Profits. At
that time, Ford had more orders than they could deliver. They could have easily raised
prices. To quote Henry Ford I dont believe we should make such an awful profit on
our cars. A reasonable profit is right, but not too much. I hold that it is better to sell a
large number of cars at a reasonably small profit. I hold this because it enables a larger
number of men employments at good wages. These are the two aims I have in life.
then Managing Director J.J. Irani , We would have been finished otherwise. You
cannot fight a modern-day war with weapons of the Mahabharata. We would have been
annihilated had we not modernized. We realized this and embarked on the four phases
of modernization. We addressed our drawbacks like the steel making process, our
weakest link. By Mid -1990s, Tata Steel had become Indians most cost effective steel
plant and Asias first integrated steel producer. They gave equal importance for Quality
and Environment. By 2000 almost all their divisions were certified for ISO 9001
(Quality Management System) and ISO 14001 (Environment Management System). In
the beginning of twenty first century, Tata Steel had completed four phases of the
modernization programme with an investment of close to Rs 60 billion. The
achievements of Tata Steel were mostly attributed to its implementation of Total
Operational Performance (TOP). The Top Program aimed at large improvements in
Throughput, Quality and Cost both in the short term and in the long term.
In the WSD ranking in 2001 (World Steel Dynamics), Tata Steel was ranked No 1
ahead of world leaders like Posco of South Korea, Baosteel of China and Nippon Steel
of Japan.
Subsequent to the implementation of TOP program, Tata Steel adopted another program
titled Performance Ethic Programme (PEP). Under this programme , they promoted
hardworking and result oriented young people to higher positions depending on their
performance, rather than following the convention of seniority. PEP had two core
elements. Firstly, it proposed a new organizational structure, which resulted in fostering
growth businesses, introduced better flexibility in decision making process, clearly
defined accountability and encouraged teamwork at all levels. The result of PEP was
introduction of a transparent Performance Management System (PMS) which helped in
identifying and rewarding strong performers and ensure enough development
opportunities for deserving employees. Though these programs, Tata Steel reduced the
hierarchical levels from 13 to 5, which in turn resulted in increase in speed and
accuracy of communication and faster decision making at all levels.
Tata Steel at the right time used Information Technology as a Strategic Tool. They
formed cross functional teams bringing in executives and managers from various
functional areas such as Marketing, Operations, Finance, Engineering etc, and also
included consultants from Arthur D Little and IBM Global Services. The main
responsibilities given to the teams was to re-design two core business processes Order
Generation & Fulfilment and Marketing Development. The aim of the program was to
1037
enhance Customer Focus (The first Principle in Eight QMS Principles) by enabling
better credit control of Reduction of stocks. Tata Steel was among the first to introduce
ERP system. They went in for SAP R/3. They called the team as ASSET Achieve
Success through SAP Enabled Transformation. The team went about integrating SAP
into the then existing information system and made it compatible with future SAP
implementations. The business processes became more efficient. Improvements were
found in Customer Service and Productivity. The introduction of SAP also brought
down the inventory carrying cost from Rs 190 per ton to Rs 155 per ton in less than two
years.
Every member of the global Tata Steel family is bound by a Corporate Culture that is
shaped by the values that guide every business decision.
Tata Steel has adopted an integrated Business Model to support its vision of being a
global leader in creation of value, while being a steel industry benchmark organization
in corporate citizenship in its efforts towards Social Responsibility and Environmental
Performance.
A strong commitment to the cause of sustainable development, dedicated adherence to
Environment Management Systems and Quality Standards and a strong belief in
inclusive growth have led the company to earn a number of national and international
awards and accolades.
1038
No competition led Hindustan Motors to complacency and they did not pay the required
extra attention to focus on customers. They did not make serious efforts to anticipate the
future requirements of customers. Some reports say that old Ambassador cars had to be
taken to workshop after delivery of cars from showrooms for re-welding and certain
other modifications for the basic driving situation. Another report (may be partly in a
lighter vein) said that the car used to make lot of sound from each part of the car except
the horn while driving the car.
Fuel efficiency is another area which Hindustan Motors did not pay required attention.
1981 saw the entry of small fuel efficient Maruti 800 with better aesthetics. This
marked the beginning of the downfall of Hindustan Motors. When Hindustan Motors
realized that they are not able to fight the competition, they could have adopted the
strategy If you cannot compete, better collaborate. They could have partnered with
MUL (Maruti Udyog Limited) to develop fuel efficient engines for their future models.
Despite having a wide distributor network, they were unable to hold their position in
market due to their inability to devise marketing strategies with the changing times and
changing customer preferences. It was too late (1997), Hindustan Motors signed a JV
with Mitsubishi.
On the People Management Front, they never thought it fit to pay attention. There were
lot of internal squabbles as well as union problems. HRM was not practised effectively.
The secret behind rise of MUL is their effective HRM policies.
Hindustan Motors did not take care of any of its stakeholders. They never paid any
dividend to its shareholders. CITU, the trade union of CPM had its own part to play in
the downfall. The Birla Management seemed to have lacked the guts to confront them
or the will to find mutually acceptable solutions.
Hindustan Motors also did not pay attentions to improve Productivity and Quality. They
also did not think of reengineering the shop floor processes.
Hindustan Motors could not capitalize their strengths in the premium segment. The
market share in premium segment was eaten up by Maruti Udyog and Honda. This was
mainly due to the attractive advertising and effective marketing strategies of the
competitors.
Analysts attributed the reasons for downfall of Hindustan Motors as Management
Myopia, Lax Management Policies, Missing Customer Focus and Lack of Timely
Technology Upgradation. The other reasons are no effort to solve internal problems and
failures to design Aesthetics and Aerodynamic vehicles.
1039
The conclusion we can draw from this case study is that while enjoying a high market
share, the companies need to look at the Big Picture, adopt Data driven decision making
and indulge in continuous innovation.
the various processes inside the organization as well as with the suppliers and dealers
external to the organization. Strive for perfection is all about aiming for Zero Wastes
and Zero Defects.
had been in place for over two decades. In 1990, Kodak had launched its Photo CD
system for storing photographic images. With leadership that constituted senior
executives recruited from Apple, GE, HP and Motorola, Kodaks digital imaging efforts
tasted successes.
Kodak could not sustain their competitive advantage and faced major competitive
challenges from Fuji and Polaroid. The advent of the PCs ushered in a variety of new
printing technologies.
The emerging digital value chain in the beginning of twenty first century made things
more difficult for Kodak. Photography evolved rapidly from the traditional chemical
based technology to a digital technology. The introduction of mobile phones with
cameras made things still worse for Kodak. The customers took digital pictures,
downloaded them onto their computers, edited them and transmitted them through the
internet for others to view electronically. That is how the new digital value chain made
redundant most of Kodaks core competitive advantages.
Kodak emphasis more on printed images. Their digital strategy from 1993 to 2012 was
the belief that digital technology would not eliminate printed images. Perhaps, this is
1041
where they went wrong. Their emphasis on printed images was reinforced by its own
capabilities; the printing of photographic and other images onto paper and other media
lay at the heart of Kodaks traditional chemical and chromatic knowhow. Kodak made
the mistake of investing heavily in its printing knowhow and in printers: both
commercial and consumer. Their decision to make a major investment to build Kodaks
presence in the market for consumer inkjet printers has been the most widely criticized
of all their digital imaging initiatives.
Kodaks forecasts proved wrong in relation to emerging market demand. Their
acquisition of Chinese photographic film producers were based on the assumption that
the sales of roll film would continue to increase into the twenty first century.
Experts opine that the transition period between traditional and digital imaging could
have been better managed by Kodak by exploiting its brand loyalty and vast distribution
system and by offering hybrid solutions while building the resources and capabilities
required for digital imaging.
Kodak was initially successful in adapting to a highly disruptive technological
revolution. Kodak was also able to build the capabilities needed to become a significant
player in a radically different area of technology. Kodak was not slow to recognize the
digital threat. Kodaks market leadership in digital cameras pointed to its ability to build
technological knowhow, apply that knowhow to develop attractive new products, and
market those products in fiercely competitive digital markets.
Perhaps Kodaks Product Market Strategy did not pay off. Their emphasis seemed to
be on the wrong markets and wrong products. Kodaks biggest losses had been in the
consumer market, their traditional stronghold at one point of time. There were strong
similarities between Fuji and Kodak. Both were heavily dependent on film during the
1990s and both diversified into other imaging technologies. The main difference lies in
Fujis business diversity. Fuji perhaps did better in scanning the internal and external
environments and were quick to act on the findings of the same.
We can conclude that forecasting of technological developments through better data
management and effecting innovations at the right time steered Kodak through
competitive pressures. At the same time , the strategies on products and markets for
sustainable competitive advantage did not work well for them. Innovation not only on
products but on processes, people and markets are equally important. Innovation is a
never ending activity.
11.0 Conclusion
1042
We can conclude from the analysis of few companies who have lived long and are
continuing to do well is that one common thread binds all of them the thread of
Innovation, Technology and Data Management.
We have also studied a few companies who have lived long and did not update their
technology or going for innovations at the right time or did not set up proper data
management systems have perished sometime or the other. There are few companies
not included in our list mainly because they are not more than 75 years old. But some of
the companies such as Apple and Microsoft and some Indian organizations like Bajaj
Auto and Bharath Forge have been performing extremely well because of their giving
special attention to Innovation, Technology and Data Management. These companies
are definitely likely to live longer. Technological upgradation at the right time using
data from customers and competitors, making Innovation a habit in the organization and
proper management of Big Data for decision making in all areas and at all levels are the
key factors for the success and longevity of an organization.
References:
Collins Jim and Porras Jerry Built to Last (2002), Harpercollins Publishers.
https://en.wikipedia.org/wiki/Big-data
www.hmchen.shidler.hawaai.edu/chen-big-data-MISQ.2012
www.usatoday30.usatoday.com/money/companies/management/2011-06-15-ibn-corj
www.tatasteel.com/sustainability/sustainability-awards-asp
www.rediff.com/business/slide-show-1-special-16-companies-that-have-survived-over100-years-in-india
http://en.wikipedia.org/wiki/list-of-oldest-companies
www.slideshare-net/laurenDPerry/ge-case-study-16389395
www.casestudies10.weekly.com/uploads/9/0/0/2/9002260/Hindustan-motors-casestudy-ppt
www.tata.com/innovation/articleinside/investing-in-innovation
www.icmrindia.org/casestudies/catalog/business%20strategy1/hidustan%20motors%20
struggle
1043
issues to society and to business. Responsive CSR involves companies acting as good citizens
and actively mitigating the potentially harmful effects of their value chain on society,
whereas Strategic CSR extends beyond these practices and involves initiatives that both
differentiate themselves from their competitors and are distinctly beneficial to society and the
environment. Drawing upon this categorization of firms CSR agendas and Simons levers of
control (LOC) (1991, 1995) as a frame of reference, we seek to explore how different uses of
controls facilitate the management and operationalisation of both Responsive and Strategic
CSR initiatives. It is argued that the boundary system and diagnostic uses of MCS are more
attuned to facilitating the implementation of Responsive CSR agendas, whereas the belief
system and interactive uses of MCS are more capable of enabling organisations to initiate and
manage Strategic CSR programmes. The integration of different uses of formal MCS enables
managers to embed concepts pertinent to CSR and sustainability in the mind-sets of
organizational participants and direct their behaviour to achieve firms CSR strategic
agendas.
For example, the importance of CSR to the development of China was strengthened in the
sixth plenary session of the 16th CPC congress: extensively carrying out activities to create a
harmonious situation in which everyone promotes harmony, and focusing on enhancing a
sense of social responsibility amongst citizens, enterprises and all kinds of organisations. We
must continue to improve the incentive mechanism for enterprises; we should also focus on
strengthening external constraints, guiding enterprises to improve management and fulfil
their social responsibility. 2 On 4 Jan. 2008, the State Councils State-Owned Assets
Supervision and Administration Council (SASAC) issued a publication for state-owned
enterprises (SOEs), Guidance for SOEs on their Social Responsibility Obligations, whose
purpose has been to raise awareness of Corporate Social Responsibility (CSR).
THEORETICAL FRAMEWORK :
1045
RESPONSIVE
CSR
AND
STRATEGIC
CSR
Responsive CSR and Strategic CSR Since the 1990s, companies worldwide have begun to
invest in various CSR programmes to improve their relationships with society and the
environmentnot only because they want to be good corporate citizens but also because they
believe doing so is good for business (Stone 1995; Mersereau and Mottis 2011). Porter and
1046
Kramer (2006) argue that the lack of effective coordination and control of these CSR
programmes tends to diffuse companies impact on society, resulting in unrelated efforts and
precluding a full range of social benefits from these companies actions. The authors contend
that companies social agendas must be responsive to stakeholders requirements (i.e.
fulfilling Responsive CSR), but these agendas must also move beyond simply meeting
societal expectations. Companies must further engage in CSR activities that reinforce their
strategies and leverage their capabilities to improve their competitive advantages (i.e.
developing Strategic CSR).
Responsive CSR involves acting as a good corporate citizen, satisfying the evolving needs of
stakeholders, and mitigating existing or potential adverse effects of organizational activities.
Strategic CSR moves beyond Responsive CSR and directs organisational resources and
managerial attention to initiate and operationalise CSR agendas that are consistent with firms
strategies and are able to differentiate themselves from their competitors, resulting in
strengthened strategic positions. This study aims to extend the work of Porter and Kramer
(2006) by proposing a framework that illustrates the role of MCS in operationalising and
managing Responsive and Strategic CSR agendas.
ROLE OF MCS IN MANAGING CSR STRATEGIES
CSR STRATEGIES
APPROPRIATE
USE
OF
MNC
Responsive CSR agendas
system
and
corporate
citizenship
mitigating
existing
of
MCS
are
more
MAJOR FINDINGS :
1047
We examine the empirical data to explore different CSR programmes initiated in two case
companies. In particular, we investigate the manner in which different uses of MCS
operationalise and incentivize these CSR programmes. Our empirical data analysis is
conducted in three steps. First, we identify different CSR programmes conducted within each
case company and the manner in which social and environmental issues are embedded in
decision-making and operations in different departments within C1 and C2. Second, we
categorize these CSR programmes into Responsive and Strategic CSR based on the
framework proposed by Porter and Kramer (2006). If the CSR programme or the manner in
which social and environmental issues are embedded in the firms operations does not
reinforce or transform its strategic competitiveness, we consider it Responsive CSR;
otherwise, we consider it Strategic CSR. Third, we closely examine how different uses of
MCS operationalise and facilitate these CSR programmes. We find that Responsive CSR
agendas tend to be facilitated by boundary and diagnostic systems because they are explicit
and coherent, whereas Strategic CSR programmes are selected and controlled interactively.
The detailed analysis of different CSR programmes and the uses of controls in facilitating
these programmes are summarized in .
Implications for practical applications
Develop both Responsive and Strategic CSR agendas to mitigate social and environmental
risks and address social issues that strengthen competitive advantage.
Adopt diagnostic uses of budget and performance management systems to monitor and
facilitate Responsive CSR agendas.
Instill a core value of sustainability within the company and apply MCS in an interactive
manner to inspire and operationalise Strategic CSR agendas.
Balance economic short-term interests and long-term sustainability as an on-going, dynamic
management process.
Strategic CSR
Compared with C1, C2, as a not-for-profit organisation, perceives CSR in a more positive
and proactive manner. As one of the most popular amusement parks in China, C2 formulated
its core values with a focus on providing quality service to the community and consideration
of the environment and nature. This belief system facilitates senior managers understanding
of CSR as a source of competitive advantage. Educating and entertaining the community
while preserving the environment and nature is C2s primary operating objective.
Guided by this core value, C2 developed educational programmes for park visitors and
students. It provides over 36 different educational programmes to students at all levels, from
1048
pre-school to college. These programmes advocate for animal conservation and a sustainable
lifestyle11. These interactive educational programmes attract visitors, encourage exploration
of the plants and animals at the amusement park, and increase brand awareness among young
people. In addition to strengthening C2s competitive advantage, these programmes
profoundly benefit society by raising awareness among the young generation about
environmental protection and fostering a deeper understanding of the relationship between
humans and the environment.
Reference :
Abernethy, M. A., and P. Brownell.( 1999), The role of budgets in organizations facing
strategic change: an exploratory study. Accounting, Organizations and Society 24 (3):189204.
1049
DR.V.SELVAM
PROFESSOR OF COMMERCE,
SSL, VIT UNIVERSITY,
VELLORE 6320014, TAMIL NADU, INDIA.
Abstract
The year 1991 noted a marked change in the history of the online world in India where Ecommerce became a favorable choice amongst the commercial uses of the internet. The first
E-commerce services available were mainly offered in the travel industry.
The digital
universe in India is doubling in size every two years and will multiply nine-fold between
2014 and 2020. As per the Associated Chambers of Commerce and Industry (ASSOCHOM),
the top 10 e-commerce players in India are: Flipkart, Ebay, Snapdeal, Amazon, Myntra,
Shopclues, Dominos, Freecharge, Jabong and Tradus. In 2014, the E-commerce giants of
India, mainly Flipkart, Amazon India and Snapdeal were the major players of the year.
Indian e-commerce market value was $8.5 billion in 2012 and $16 billion in 2013 and will be
$56 billion in 2023. Success of E-commerce depends on the effective shopping, prompt
delivery and increased use of online payment mechanism. Even though India has more
growth in E-commerce, there is a frequent demand by the brick and mortar business against
the rapidly expanding E-commerce entities like Flipkart and Snapdeal for disrupting the
market by charging predatory prices, adopting unfair business practices, less information and
convenience. Based on the above, this research paper going to address the real opportunities
for customer in E-tailing in Vellore city, Tamil Nadu, India.
Keywords: E-tailing, Opportunities, Customer perception, Global market.
Customer Perception towards Opportunities in E Tailing:
1050
A Factor Analysis
1. INTRODUCTION
India has an internet user base of about 250.2 million as of June 2014. The penetration of ecommerce is low compared to markets like the United States and the United Kingdom but is
growing at a much faster rate with a large number of new entrants. The industry consensus is
that growth is at an inflection point. The online retail market has evolved and grown
significantly over the past few years. Asia Pacific is emerging as the fastest growing region
for online retail with China showing tremendous potential. In India, online retail or E-tailing
market represents a very small fraction of the total retail market India, but holds immense
business potential driven mostly by growing internet penetration, increasing usage of smart
phones, cost advantages and huge funding by private equity investors. Popularity of cash-ondelivery (COD) and rising working women, growing acceptability of online payments,
favorable demographics, and lack of organized retail market are the other key factors driving
the growth of online retail in India. In the Indian online retail market, major e-tailing firms
like Flipkart, Snapdeal and Amazon have adopted asset light model and hence moved away
inventory based model to marketplace model. Private equity players and venture capital
firms have shown their faith in the growth of online retail in India and it is evident with
Flipkart receiving eight rounds of funding over the last seven years. However, with immense
growth opportunities, the online retail market faces the challenges in terms of logistics
services as the key to online retail is to deliver products on time. Logistics and infrastructure,
huge maintenance cost of warehouses, costly middlemen, and error in online payments are a
few of the bottlenecks in the growth of the industry. Based on the above background, this
research paper going to address the real opportunities for customer in E-tailing in Vellore
city, Tamil Nadu,India.
2. CONCEPT OF E-TAILING
E-tailing or e-retailing refers to the selling of retail goods electronically over the Internet. The
term is a short form for "electronic retailing", and surfaced in the 1990s for being frequently
used over the Internet. The term is an inevitable addition to other similar terms such as ebusiness, e-mail, and e-commerce.
1051
India's E-commerce market was worth about $3.8 billion in 2009, it went up to $12.6 billion
in 2013. In 2013, the E-retail market was worth US$ 2.3 billion. About 70% of India's Ecommerce market is travel related. India has close to 10 million online shoppers and is
growing at an estimated 30%. Electronics and Apparel are the biggest categories in terms of
sales. India's retail market is estimated at $470 billion in 2011 and is expected to grow to
$675 billion by 2016 and $850 billion by 2020, estimated CAGR of 7%. According to
Forrester, the E-commerce market in India is set to grow the fastest within the Asia-Pacific
Region at a CAGR of over 57% between 2012 to 2016. On 7th March 2014 E-tailer Flipkart
claimed it has hit $1 billion in sales, a feat it has managed to achieve before its own target
(2015). Overall E-commerce market is expected to reach Rs1,07,800 corers (US$24 billion)
by the year 2015 with both online travel and E-tailing contributing equally. Another big
segment in E-commerce is mobile/DTH recharge with nearly 1 million transactions daily by
operator websites.
4. THE TOP E-COMMERCE MARKETS
With all the noise about e-commerce in India, one might want to believe that our e-commerce
markets are among the biggest in the world. But the truth is, India is not in the top 5. The
following table 1 depicts the top e-commerce global sales, tends and statistics.
Table 1 E-commerce global sales, trends and statistics
Country
E-Commerce
Users
33% Tablet,
Spending
(in billion)
China
$562.66
USA
$349.06
69% PC
activity.
13% Tablet,
$93.89
12.1% Tablet,
1052
$79.33
6% Tablet,
$74.46
11.5% Tablet,
Highest
open
rates
occur
in
the
5. REVIEW OF LITERATURE
1053
reliable/prompt responses, access, ease of use, attentiveness, security, and credibility. Second,
of the six, three dimensions, notably reliable/prompt responses, attentiveness, and ease of use,
had significant impacts on both customers perceived overall service quality and their
satisfaction. Third, the access dimension had a significant effect on overall service quality,
but not on satisfaction. Finally, this study discovered a significantly positive relationship
between overall service quality and Satisfaction. Rabinovich (2004) and Cao and Zhao
(2004) have identified the challenges of E-tailing industry. This challenge begins with the
response time of the web-server; moves to the amount of time the customer must wait until
the order ships, and also includes the time the shipping process takes. Delone and Reif
(2004) have found that at present customers are more likely to continue shopping online
when they have a greater experience of online shopping. It is also found that young adults
have a more positive attitude towards online buying. Bauer et al., (2006) have compared the
services of online retail service vs. traditional retail services. They have identified that the
online retail services are broken into two rather distinct phases: the client interaction phase
taking place online and the fulfillment phase taking place offline. They also have suggested
that web-site quality is a matter of delivering both hedonic and utilitarian elements. Yao
Chuan Tsai and Jong Chao Yeh (2010) conducted a study on - Perceived risk of
information security and privacy in online shopping: A study of environmentally sustainable
products. The basic objective of this study was to explore website characteristics related to
perceived risk of information security and purchase intention. Suresh A. M., Shashikala R
(2011) study identifying factors of consumer perceived risk towards online shopping in India.
This paper attempts to investigate the factors influencing customer perceived risk of online
shopping in Indian context. Reliability coefficient for the scale was satisfactory and factor
analysis generated 6 major factors: monetary, performance, time, source, social, and
psychological. Monetary and performance risks have highest mean scores and social and
psychological risks being the lowest. Further T test confirmed that all of these factors had
significant impact. Almousa (2011) and Masoud (2013) studied financial risk is the
concern of losing credit card information or the risk of losing money due to improper
functioning of product or because of being overcharged. Various researchers in the past have
proved that financial risk inversely impacts consumers attitude towards online shopping.
Claudia (2012), Sinha and Singh (2014) studied the Financial risk, risk of delivery and
product performance risk are identified as the most important concerns in online shopping.
6. STATEMENT OF PROBLEM
1054
The statement of problem for the study relating to opportunities of E- tailing of India are:
Lack of high speed internet connection, less usage of credit card, preference for cash
payments over credit card usage, concern for authenticity of goods purchased, uncertainty
about the delivery of products, security for online transactions, and some of the other
problems of online retailing in India are: less convenience, no better information, more
competitive pricing, less customization, less wide range of options, online shopping can be
done only by those people who are computer literate and can operate a computer, tt can be
done only if the consumer has internet banking or debit card or credit card facility in his bank
account, many consumers fear that the product they will receive could be different from the
product that they had ordered. All products cannot be bought online like grocery and other
products of daily needs. From the above various problems discussed in India, so far more
studies are done and that to focused on problems, emerging trends, impact, assessment, key
roles of E-tailing and few studies are done on customers perception, attitude, satisfaction
towards E- tailing in India and no studies done so far on customer perception towards
opportunities in E-tailing in Vellore city, Tamil Nadu. Hence, this study undertaken titled
customers perception towards opportunities in E-tailing in Vellore city.
Sample area: Customers who buy products through E-Commerce in Vellore city,
Tamil Nadu, India.
Data analysis: Statistical techniques like Frequency distribution and factor analysis.
1055
Category
Frequency
1056
Percentage
Gender
Monthly usage
Male
52
52.0
Female
48
48.0
Total
100
100.0
No usage
8.0
68
68.0
6000 10000
20
20.0
11000 15000
4.0
Total
100
100.0
Amazon
13
13.0
Snapdeal
22
22.0
Myntra
6.0
Jabong
7.0
Flipkart
52
52.0
Total
100
100.0
Consumer
27
27.0
52
52.0
1.0
Mobile/DTH
9.0
Others
11
11.0
Total
100
100.0
Debit card
23
23.0
Credit card
9.0
Net banking
8.0
Cash on delivery
60
60.0
Total
100
100.0
electronics
Goods purchased
Payment mode
recharge
respondents belong to the website group of Flip kart and only 22% of the respondents belong
to the website group of Snap deal. 52% of the respondents belong to the goods group of
apparel and fashion and only 9% of the respondents belong to the goods group of
mobile/DTH recharge. 60% of the respondents belong to the payment group of cash on
delivery and only 8% of the respondents belong to the payment group of net banking.
11.2 OPPORTUNITIES IN E TAILING
11.3 FACTOR ANALYSIS
Factor analysis technique has been applied to find the underlying dimensions (factors) that
exist between the 6 identified variables relating to Opportunities of E-tailing in India selected
for the study. Factor analysis is used for the purpose of identifying the variables that lead to
opportunities process. That is, the factor analysis tries to identify the underlying dimensions
in the original variables.
11.4 FITNESS TO FACOTR ANALYSIS
(A) KMO and Bartletts Test
Two tests namely, Kaiser-Mayer-Olkin (KMO) test measures of sampling adequacy and
Bartletts Test of Sphercity is applied to test whether the relationship among the variables has
been significant or not as shown in table 3.
Table 3
KMO and Bartlett's Test
Kaiser-Meyer-Olkin Measure of Sampling Adequacy.
.850
Approx. Chi-Square
143.959
Df
15
Sig.
.000
The KMO measure of sampling adequacy shows the value of test statistic is 0.850.which
means the factor analysis for the selected variables is found to be appropriate to the
population. Bartletts test of sphercity is used to test whether the hypothesis is accepted at
the significant level or not and here the hypothesis is accepted at 100 per cent level of
significance.
(B) COMMUNALITIES
Table 4 shows the proportion of the variance explained by the 6 factors in each variable.
Which is called as Communalities of the variables.
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Table 4
Communalities
Initial
Extraction
Convenience E-tailing
1.000
.581
1.000
.415
1.000
.460
Customization E-tailing
1.000
.431
1.000
.569
1.000
.522
Principal component analysis assumes that all the variance is common, therefore, before
extraction the communalities are all 1.000.
(C) Factor Extraction
(D)Total variance Explained
Principal Component Analysis is a multivariate technique for identifying the linear
components of a set of variables. Using the Principles Component Analysis one factors have
been extracted based on the variance (Eigen value greater than 1). The variance explained by
the initial solution, extracted components are displayed in table 5
Table 5
Total Variance Explained
Initial Eigen values
%
of Cumulative
Component Total
Variance
Total
Variance
2.977
49.614
49.614
2.977
49.614
49.614
.750
12.494
62.108
.655
10.917
73.026
.633
10.547
83.573
.523
8.722
92.295
.462
7.705
100.000
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Table 5
Total Variance Explained
Initial Eigen values
%
of Cumulative
Component Total
Variance
Total
Variance
2.977
49.614
49.614
2.977
49.614
49.614
.750
12.494
62.108
.655
10.917
73.026
.633
10.547
83.573
.523
8.722
92.295
Source:
Extraction
Method:
Principal
Component Analysis.
In the rotation matrix the one factor extracted which together account for 49.614% of the total
variance among the 6 original variables. This is good fit because we are able to economize on
the number of variables into one from the 6 distributed variables, while we have lost only
49.614% of the variations which are caused by other 5 variables.
(E) COMPONENT MATRIX
Table 6 gives the factor matrix of Principal Component Analysis which has extracted 1 factor
with the coefficient called factor loading. These loadings are similar to the correlation
between the factors and the variables. The matrix contains the loadings of each variable
against each factor and the coefficient are called factor loadings, as they indicate how much
weight is assigned to each factor.
Table 6
Component Matrix
Component
Factor 1
Convenience E-tailing
.762
.644
.678
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Customization E-tailing
.656
.754
.722
INFERENCE
The rotated factor loadings along with the percentage of variance explained by factor are
given in Table 5. The most influencing and naming factor Real Opportunities comprised
six items and the total percentage of variance explained was 49.61. This factor had an Eigen
value of 2.97. The principal component analysis indicates that only one major factor viz.,
convenience E-tailing, information about the E-tailing, pricing of E-tailing products,
customization E-tailing, options available for E-tailing and clock shopping in E-tailing
loaded on this factor. It is worthwhile to see that all variables relating to customer perception
towards opportunities in E-tailing have positive opinion on this.
12. FINDINGS
1. In this study the majority of 52% respondents belonging to the gender group of Male, 68%
respondents belonging to monthly usage group of Less than Rs.5,000, 52% respondents
belonging to often used website group of Flipkart, 52% respondents belonging to goods
purchased group of Apparel and fashion and 60% respondents belonging to payment mode
group of Cash on delivery.
2. The most influencing and only one naming factor Real Opportunities comprised six
items and the total percentage of variance explained was 49.61. So, it is more important to
see that all six variables relating to customer perception towards real opportunities in Etailing have positive opinion on this.
13. SUGGESTIONS
1061
Based on the research, suggestions are offered for making E-tailing more beneficial to
customers are: Online Retailing companies should maintain a database of all the necessary
information of consumers, ensure that the process of ordering for the products is easy, make
more popular among the consumers, take proper measures to protect the information shared
by the consumers, website of the Online Retailer should be easy to use and navigate, should
ensure that the payment process is secured, provide money back guarantee if the consumer
wants to return the product and get back his money, provide correct information about the
product and its availability and value proposition of the customer.
14. CONCLUSION
To conclude that, the future of E-tailing in India looks promising. There is growth in the
market for E-tailing. The acceptance of E-tailing in India is increasing with the emergence of
new technologies which are facilitating operations. The youth of India is one of the major
driving forces for the sales of E-tailing in India. They have access to internet and they are
ready to purchase products online. They are one of the major groups of customers that have
boosted the sales in E-tailing. India is one of the few countries in the world that have the
advantage of demographic dividend. Around 64% of Indias population is expected to be in
the age bracket of 1559 years by 2026. This is the age group that is ready to take risk,
purchase latest products etc. So, E-tailing should tap this section of the market and utilize the
demographic dividend of India to their advantage. The Indian online retail sector is evolving
rapidly and those who enter the market now can learn local dynamics develop market insights
and establish leadership positions. We can say that this is just the beginning for this emerging
marketplace. E-tailing in India will quickly match the growth of E-tailing in other countries.
REFERENCE
1. Almousa M (2011), Perceived Risk in Apparel Online Shopping: A Multi-Dimensional
Perspective, Canadian social science, Vol.7, No.2, pp.23-31.
2. Bauer, H. H., Falk, T. and Hammers chmidt, M. (2006), E-Trans Qual: A Transaction
Process-based Approach for Capturing Service Quality in Online Shopping, Journal of
Business Research, Vol.59, pp.866-875.
3. Brown, Stephen (1987), Institutional Change in Retailing: A Review and Synthesis,
European Journal of Marketing, Vol.21, No.6, pp.5-36.
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