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Case study solution, project report, assignment answers

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BUSINESS LAW
___________________________________________________________________________________
1) a) What is a breach of contract?
b) What do you understand by an anticipatory breach of contract?
c) State the rights of the promise in case of anticipatory breach.
2) a) State the effect of death, insanity and insolvency of the principal or agent on a contract of agency.
b) When does termination of agency takes effect?
c) When is an agency irrevocable?
3) Discuss the common features of a promissory note, bill of exchange and cheque.
4) a) What is meant by maturity of an instrument?
b) What is meant by day of grace?
c) Explain the provision relating to the calculation of date of maturity.
5) Explain with example the doctrine of supervening impossibility.
6) a) What are the agreements by way of wager?
b) State the legal effect of such agreements.
c) Is a contract of insurance a wager?
7) “No action is allowed on an illegal agreement. ”Comment and state the exceptions (if any) to this
rule.
8) a) Define Coercion.
b) State the effect of Coercion on the validity of a contract.
c) Does the threat of commit suicide amount to Coercion?
d) On whom the burden of proof lies in case of Coercion

Business Marketing_
Marks : 80
NB.1) All questions carry equal marks.
2) All questions are compulsory.
Q.No.1.write a short note (any two) (10)
a) Customer Retention and Maximization
b) The One-to-One Media
c) The Character of Business Marketing
Q.No.2.What is Business Marketing? Discuss the Character of
Business Marketing (10)
Q.No.3.what is the Market Opportunities in term of Current and
Potential Customers. (10)
Q.No.4.What is Marketing Strategy? How do integrate Marketing
into the Fabric of the Firm (10)
Q.No.5.What is the Business Marketing Channels? How do you
Create Customer Dialogue (10)
AN ISO 9001 : 2000 CERTIFIED INTERNATIONAL B-SCHOOL
Q.No.6. Discuss various ways of developing and Managing
Products? (10)
Q.No.7. Discuss the ways to Evaluate Marketing Efforts? What are
various programs for the Customer Retention management? (10)
Q.NO.8.Define and distinguish Business Markets and Business
Marketing .As a marketing manager how will you identify
Organizational Buyer Behavior. (10)


BUSINESS STRATEGY KSBM ONGOING EXAM ANSWER SHEETS PROVIDED

BUSINESS STRATEGY KSBM ONGOING EXAM ANSWER SHEETS PROVIDED WHATSAPP 91 9924764558

CONTACT:DR. PRASANTH MBA PH.D. DME MOBILE / WHATSAPP: +91 9924764558 OR +91 9447965521 EMAIL: prasanththampi1975@gmail.com WEBSITE: www.casestudyandprojectreports.com

______________________

Door Darshan is the India’s premier public service broadcaster with more than 1,000 transmitters
covering 90% of the country’s population across on estimated 70 million homes. It has more than
20,000 employees managing its metro and regional channels. Recent years have seen growing
competition from many private channels numbering more than 65, and the cable and satellite
operators (C & S). The C & S network reaches nearly 30 million homes and is growing at a very fast
rate.
DD’s business model is based on selling half – hour slots of commercial time to the programme
producers and charging them a minimum guarantee. For instance, the present tariff for the first 20
episodes of a programme Rs.30 lakhs plus the cost of production of the programme. In exchange
the procedures get 780 seconds of commercial time that he can sell to advertisers and can generate
revenue. Break-even point for procedures, at the present rates, thus is Rs.75,000 for a 10 second
advertising spot. Beyond 20 episodes, the minimum guarantee is Rs.65 lakhs for which the
procedures has to charge Rs.1,15,000 for a 10 second spot in order to break-even. It is at this
point the advertisers face a problem – the competitive rates for a 10 second spot is Rs.50,000.
Procedures are possessive about buying commercial time on DD. As a result the DD’s projected
growth of revenue is only commercial time on DD. As a result the DD’s projected growth of revenue
is only 6-
10% as against 50-60% for the private sector channels. Software suppliers, advertisers and
audiences are deserting DD owing to its unrealistic pricing policy. DD has options before it. First, it
should privates, second it should remain purely public service broadcaster and third, a middle path.
The challenge seems to be exploit DD’s immense potential and emerge as a formidable player in the
mass media.
i. What is the best option, in your view, for DD?
ii. Analyse the SWOT factors the DD has.
iii. Why do you think that the proposed alternative is the best?
Case 2
In 2006-07 PTC Food division decided to enter the fast growing (20-30% annually) snacks segment,
an altogether new to it. It had only one national competitor-Trepsico’s Trito. After a year its wafer
snack brand- Ringo, fetched 20% market share across the country. Ringo’s introduction was
coincided with the cricket world cup. The wafer snacks market is estimated to be around Rs. 250
crores.
The company could take the advantage of its existing distribution network and also source potatoes
from farmers easily. Before the PTC could enter the market a cross-functional team made a customer
survey through a marketing research group in 14 cities of the country to know about the snacks of
eating habits of people. The result showed that the customers within the age-group of 15-24 years
were the most promising for the product as they were quite enthusiastic about experimenting new
snack taste. The company reported to its chefs and the chefs came out with 16 flavours with varying
tastes suiting to the targetted age-group.
The company decided to target the youngsters as primary target on the assumption that once they
are lured in, it was easier to reach the whole family.
Advertising in this category was extremely crowded. Every week two-three local products in new
names were launched, sometimes with similar names. To break through this clutter the company
decided to bank upon humour appeal.
The Industry sources reveal that PTC spent about Rs. 50 crores on advertisement and used all
possible media- print and electonic, both including the creation of its own website,
Ringoringoyoungo.com with offers of online games, contests etc. Mobile phone tone downloading
was also planned which proved very effective among teenagers. The site was advertised on all
dotcom networks. Em TV, Shine TV, Bee TV and other important channels were also used for its
advertisement along with FM radio channels in about 60 cities with large hoardings at strategic
places.
Analysts believes that Ringo’s success story owes a lot to PTC’s widespread distribution
channels and aggressive advertisements. Humour appeal was a big success. The `Ringo’ was made
visible by painting the Railway bogies passing across the States. It has also been successful to
induce Lovely Brothers’ Future Group to replace Trito in their Big-Bazaar and chain of food Bazaars.
PTC is paying 4% higher margin than Trepsico to Future group and other retailers.
Ringo to giving Trepsico a run for its money. Trito’s share has already been reduced considerably.
Retail tie- ups, regional flavours, regional humour appeals have helped PTC. But PTC still wants a
bigger share in the market and in foreign markets also, if possible.
Answer the following questions:
a) What is SWOT Analysis? (4 Marks)
b) What are the strength of PTC? (4 Marks)
c) What are the weaknesses of PTC for entering into the branded snacks market? (4 Marks)
d) What kind of marketing strategy was formulated and implemented for Ringo?
What else need to be done by Ringo so as to enlarge its market? (8 marks )
Case 3
Dr. Sukumar inherited his father’s Dey’s Lab in Delhi in 1995. Till 2002, he owned 4 labs in the National
Capital Region (NCR). His ambition was to turn it into a National chain. The number increased to 7 in
2003 across the country, including the acquisition of Platinum lab in Mumbai. The number is likely to go
to 50 within 2 – 3 years from 21 at present. Infusion of Rs.28 crores for a 26% stake by Pharma Capital
has its growth strategy.
The lab with a revenue of Rs.75 crores is among top three Pathological labs in India with Atlantic
(Rs.77 crores) and Pacific (Rs.55 crores). Yet its market share is only 2% of Rs.3,500 crores
market. The top 3 firms command only 6% as against 40 – 45% by their counterparts in the USA.
There are about 20,000 to 1,00,000 stand alone labs engaged in routine pathological business in
India, with no system of mandatory licensing and registration. That is why Dr. Sukumar has not
gone for acquisition or joint ventures. He does not find many existing laboratories meeting quality
standards. His six labs have been accredited nationally whereon many large hospitals have not
thought of accreditation. The College of American Pathologists accreditation of Dey’s lab would help it
to reach clients outside India.
In Dey’s Lab, the bio-chemistry and blood testing equipments are sanitized every day. The bar
coding and automated registration of patients do not allow any identity mix-ups. Even routine tests
are conducted with highly sophisticated systems. Technical expertise enables them to carry out
1650 variety of tests. Same day reports are available for samples reaching by 3 p.m. and by 7 a.m.
next day for samples from 500 collection centres located across the country. Their technicians work
round the clock, unlike competitors. Home services for collection and reporting is also available.
There is a huge unutilized capacity. Now it is trying to top other segments. 20% of its total business
comes through its main laboratory which acts as a reference lab for many leading hospitals. New
mega labs are being built to encash preclinical and multi – centre clinical trials questions.
i. What do you understand by the term Vision? What is the difference between ‘Vision’ and
‘Mission’? What vision Dr. Sukumar has at the time of inheritance of Dey’s lab? Has it been
achieved? ( 8 Marks)
ii. For growth what business strategy has been adopted by Dr. Sukumar?
. (2Marks)
iii.What is the marketing strategy of Dr. Sukumar to overtake its competitors?
. (6Marks)
iv. In your opinion what could be the biggest weakness in Dr. Sukumar’s business strategy?
. (4 Marks)
Case : 4 (20 Marks )
The origins of Deepak Nitrite—the flagship comp any of the Deepak group of industries-go back to 1970
when Chimanlal K. Mehta, an entrepreneur, sensing an opportunity in India’s drive towards selfsufficiency
and import substitution and relying on his trading and manufacturing experience, ventured into
the chemicals industry. The Company was originally incorporated as Deepak Nitrite Private Limited in
1970, under the Companies Act, 1956 and was subsequently converted into a public limited company in
the name of Deepak Nitrite Limited in 1971. The company’s registered office is at Vadodara and its
corporate office is at Pune with manufacturing plants in Gujarat and Maharashtra. Net sales for the year
ending March 2007 are about Rs. 4172 million and net profit is Rs. 357 million. Exports constitute nearly
half of the sales.
Overt he years, Deepak Nitrite has grown impressively through a judicious use of integration, related
diversification and internationalization strategies, using the means of acquisition and restructuring. In
1983, adopting a horizontal integration strategy, the company used foreign collaboration to start
commercial production of ammonia. In 1989, the group employed ammonia-based forward integration and
also diversified into the chemicals related area of methanol. In 1992 came the commercial production of
low-density ammonium nitrate, nitro phosphate and nitric acid, resulting in a multi-product portfolio
consisting of organic, inorganic, fine and specialty chemicals. Deepak Nitrite has made tremendous
progress over the years and has posted impressive financial results as well as excellent export
performance. It (the growth of the company), was born out of a process of deep thinking, strategy and
planning,’ said the managing director Deepak Mehta, who claims that planned strategy has led to growth.
Environmental scanning led to foreseeing the threats coming from a dismantled duty regime. Anticipating
this, the company went about implementing strategies that would convert these threats into opportunities.
The strategic approach was to build on its strengths in niche areas of the chemicals market, leverage
strong R & D and a robust lab to product ion skills, bring the strengths up to global levels and work
towards a leadership position.
The success of Deepak Nitrite could be attributed to its focused strategy. Implementation capabilities. A
series of plans, programmes and project have been initiated and implemented over the years, in
alignment with its corporate and business strategies. For instance, it has worked on a number of R&D
projects over the years to develop its skills to swiftly transfer products from the labs through production to
the markets. It has effectively developed differentiating capabilities by planning and implementing
projects for handling bulk products to handling batch products, transforming from a commodity supplier to
a value-added, branded product supplier with customization skills. Projects in supply chain management
have helped the company in extending its ability to source its own raw material to tracking customers’
delivery and inventory scheduling. Cost control has been attempted through wider sourcing; including
international vend ors, and investing in energy-saving equipments.
In the course of strategy implementation, Deepak Nitrite has to deal with a host of government agencies
for procedural implementation. For example, raising finance has taken it to SEBI. A continual interaction
takes place with the export and import regulatory authorities. For instance, anti-dumping duties have
been levied on the comp any for sourcing cheap materials from China. Being in the chemical processing
industry, the company is under the scrutiny of environmental protection agencies. It has been a signatory
to the ‘Responsible Care’ initiative of the global chemical industry. It has also achieved the ISO 14001
certification. Dealing with explosives, the company has to seek licenses from the Department of
Explosives, Industrial Safety and Health Departments and State Pollution Boards of Gujarat and
Maharashtra. Apart from these are the regulatory requirements dealing with taxation purposes. Resource
generation has been through raising money in the capital markets on the basis of its good reputation,
internal accruals, loans from commercial banks and financial institutions and sale of factory land at
Pune.28
Questions:-
1. Identify and discuss briefly, the three themes of strategy implementation of activating strategies,
managing change and achieving effectiveness in the case of Deepak Nitrite.
2. picking up data from the case, demonstrate how formulation and implementation of strategy are
interdependent.


BUSINESS STRATEGY KSBM EMBA ONGOING EXAM ANSWER SHEETS PROVIDED

BUSINESS STRATEGY KSBM EMBA ONGOING EXAM ANSWER SHEETS PROVIDED WHATSAPP 91 9924764558
CONTACT:
DR. PRASANTH MBA PH.D. DME MOBILE / WHATSAPP: +91 9924764558 OR +91 9447965521 EMAIL: prasanththampi1975@gmail.com WEBSITE: www.casestudyandprojectreports.com

SUBJECT: Business Strategy
__________________________
Case 1 (20 Marks)
Door Darshan is the India’s premier public service broadcaster with more than 1,000 transmitters
covering 90% of the country’s population across on estimated 70 million homes. It has more than
20,000 employees managing its metro and regional channels. Recent years have seen growing
competition from many private channels numbering more than 65, and the cable and satellite
operators (C & S). The C & S network reaches nearly 30 million homes and is growing at a very fast
rate.
DD’s business model is based on selling half – hour slots of commercial time to the programme
producers and charging them a minimum guarantee. For instance, the present tariff for the first 20
episodes of a programme Rs.30 lakhs plus the cost of production of the programme. In exchange
the procedures get 780 seconds of commercial time that he can sell to advertisers and can generate
revenue. Break-even point for procedures, at the present rates, thus is Rs.75,000 for a 10 second
advertising spot. Beyond 20 episodes, the minimum guarantee is Rs.65 lakhs for which the
procedures has to charge Rs.1,15,000 for a 10 second spot in order to break-even. It is at this
point the advertisers face a problem – the competitive rates for a 10 second spot is Rs.50,000.
Procedures are possessive about buying commercial time on DD. As a result the DD’s projected
growth of revenue is only commercial time on DD. As a result the DD’s projected growth of revenue
is only 6-
10% as against 50-60% for the private sector channels. Software suppliers, advertisers and
audiences are deserting DD owing to its unrealistic pricing policy. DD has options before it. First, it
should privates, second it should remain purely public service broadcaster and third, a middle path.
The challenge seems to be exploit DD’s immense potential and emerge as a formidable player in the
mass media.
i. What is the best option, in your view, for DD?
ii. Analyse the SWOT factors the DD has.
iii. Why do you think that the proposed alternative is the best?
Case 2
In 2006-07 PTC Food division decided to enter the fast growing (20-30% annually) snacks segment,
an altogether new to it. It had only one national competitor-Trepsico’s Trito. After a year its wafer
snack brand- Ringo, fetched 20% market share across the country. Ringo’s introduction was
coincided with the cricket world cup. The wafer snacks market is estimated to be around Rs. 250
crores.
The company could take the advantage of its existing distribution network and also source potatoes
from farmers easily. Before the PTC could enter the market a cross-functional team made a customer
survey through a marketing research group in 14 cities of the country to know about the snacks of
eating habits of people. The result showed that the customers within the age-group of 15-24 years
were the most promising for the product as they were quite enthusiastic about experimenting new
snack taste. The company reported to its chefs and the chefs came out with 16 flavours with varying
tastes suiting to the targetted age-group.
The company decided to target the youngsters as primary target on the assumption that once they
are lured in, it was easier to reach the whole family.
Advertising in this category was extremely crowded. Every week two-three local products in new
names were launched, sometimes with similar names. To break through this clutter the company
decided to bank upon humour appeal.
The Industry sources reveal that PTC spent about Rs. 50 crores on advertisement and used all
possible media- print and electonic, both including the creation of its own website,
Ringoringoyoungo.com with offers of online games, contests etc. Mobile phone tone downloading
was also planned which proved very effective among teenagers. The site was advertised on all
dotcom networks. Em TV, Shine TV, Bee TV and other important channels were also used for its
advertisement along with FM radio channels in about 60 cities with large hoardings at strategic
places.
Analysts believes that Ringo’s success story owes a lot to PTC’s widespread distribution
channels and aggressive advertisements. Humour appeal was a big success. The `Ringo’ was made
visible by painting the Railway bogies passing across the States. It has also been successful to
induce Lovely Brothers’ Future Group to replace Trito in their Big-Bazaar and chain of food Bazaars.
PTC is paying 4% higher margin than Trepsico to Future group and other retailers.
Ringo to giving Trepsico a run for its money. Trito’s share has already been reduced considerably.
Retail tie- ups, regional flavours, regional humour appeals have helped PTC. But PTC still wants a
bigger share in the market and in foreign markets also, if possible.
Answer the following questions:
a) What is SWOT Analysis? (4 Marks)
b) What are the strength of PTC? (4 Marks)
c) What are the weaknesses of PTC for entering into the branded snacks market? (4 Marks)
d) What kind of marketing strategy was formulated and implemented for Ringo?
What else need to be done by Ringo so as to enlarge its market? (8 marks )
Case 3
Dr. Sukumar inherited his father’s Dey’s Lab in Delhi in 1995. Till 2002, he owned 4 labs in the National
Capital Region (NCR). His ambition was to turn it into a National chain. The number increased to 7 in
2003 across the country, including the acquisition of Platinum lab in Mumbai. The number is likely to go
to 50 within 2 – 3 years from 21 at present. Infusion of Rs.28 crores for a 26% stake by Pharma Capital
has its growth strategy.
The lab with a revenue of Rs.75 crores is among top three Pathological labs in India with Atlantic
(Rs.77 crores) and Pacific (Rs.55 crores). Yet its market share is only 2% of Rs.3,500 crores
market. The top 3 firms command only 6% as against 40 – 45% by their counterparts in the USA.
There are about 20,000 to 1,00,000 stand alone labs engaged in routine pathological business in
India, with no system of mandatory licensing and registration. That is why Dr. Sukumar has not
gone for acquisition or joint ventures. He does not find many existing laboratories meeting quality
standards. His six labs have been accredited nationally whereon many large hospitals have not
thought of accreditation. The College of American Pathologists accreditation of Dey’s lab would help it
to reach clients outside India.
In Dey’s Lab, the bio-chemistry and blood testing equipments are sanitized every day. The bar
coding and automated registration of patients do not allow any identity mix-ups. Even routine tests
are conducted with highly sophisticated systems. Technical expertise enables them to carry out
1650 variety of tests. Same day reports are available for samples reaching by 3 p.m. and by 7 a.m.
next day for samples from 500 collection centres located across the country. Their technicians work
round the clock, unlike competitors. Home services for collection and reporting is also available.
There is a huge unutilized capacity. Now it is trying to top other segments. 20% of its total business
comes through its main laboratory which acts as a reference lab for many leading hospitals. New
mega labs are being built to encash preclinical and multi – centre clinical trials questions.
i. What do you understand by the term Vision? What is the difference between ‘Vision’ and
‘Mission’? What vision Dr. Sukumar has at the time of inheritance of Dey’s lab? Has it been
achieved? ( 8 Marks)
ii. For growth what business strategy has been adopted by Dr. Sukumar?
. (2Marks)
iii.What is the marketing strategy of Dr. Sukumar to overtake its competitors?
. (6Marks)
iv. In your opinion what could be the biggest weakness in Dr. Sukumar’s business strategy?
. (4 Marks)
Case : 4 (20 Marks )
The origins of Deepak Nitrite—the flagship comp any of the Deepak group of industries-go back to 1970
when Chimanlal K. Mehta, an entrepreneur, sensing an opportunity in India’s drive towards selfsufficiency
and import substitution and relying on his trading and manufacturing experience, ventured into
the chemicals industry. The Company was originally incorporated as Deepak Nitrite Private Limited in
1970, under the Companies Act, 1956 and was subsequently converted into a public limited company in
the name of Deepak Nitrite Limited in 1971. The company’s registered office is at Vadodara and its
corporate office is at Pune with manufacturing plants in Gujarat and Maharashtra. Net sales for the year
ending March 2007 are about Rs. 4172 million and net profit is Rs. 357 million. Exports constitute nearly
half of the sales.
Overt he years, Deepak Nitrite has grown impressively through a judicious use of integration, related
diversification and internationalization strategies, using the means of acquisition and restructuring. In
1983, adopting a horizontal integration strategy, the company used foreign collaboration to start
commercial production of ammonia. In 1989, the group employed ammonia-based forward integration and
also diversified into the chemicals related area of methanol. In 1992 came the commercial production of
low-density ammonium nitrate, nitro phosphate and nitric acid, resulting in a multi-product portfolio
consisting of organic, inorganic, fine and specialty chemicals. Deepak Nitrite has made tremendous
progress over the years and has posted impressive financial results as well as excellent export
performance. It (the growth of the company), was born out of a process of deep thinking, strategy and
planning,’ said the managing director Deepak Mehta, who claims that planned strategy has led to growth.
Environmental scanning led to foreseeing the threats coming from a dismantled duty regime. Anticipating
this, the company went about implementing strategies that would convert these threats into opportunities.
The strategic approach was to build on its strengths in niche areas of the chemicals market, leverage
strong R & D and a robust lab to product ion skills, bring the strengths up to global levels and work
towards a leadership position.
The success of Deepak Nitrite could be attributed to its focused strategy. Implementation capabilities. A
series of plans, programmes and project have been initiated and implemented over the years, in
alignment with its corporate and business strategies. For instance, it has worked on a number of R&D
projects over the years to develop its skills to swiftly transfer products from the labs through production to
the markets. It has effectively developed differentiating capabilities by planning and implementing
projects for handling bulk products to handling batch products, transforming from a commodity supplier to
a value-added, branded product supplier with customization skills. Projects in supply chain management
have helped the company in extending its ability to source its own raw material to tracking customers’
delivery and inventory scheduling. Cost control has been attempted through wider sourcing; including
international vend ors, and investing in energy-saving equipments.
In the course of strategy implementation, Deepak Nitrite has to deal with a host of government agencies
for procedural implementation. For example, raising finance has taken it to SEBI. A continual interaction
takes place with the export and import regulatory authorities. For instance, anti-dumping duties have
been levied on the comp any for sourcing cheap materials from China. Being in the chemical processing
industry, the company is under the scrutiny of environmental protection agencies. It has been a signatory
to the ‘Responsible Care’ initiative of the global chemical industry. It has also achieved the ISO 14001
certification. Dealing with explosives, the company has to seek licenses from the Department of
Explosives, Industrial Safety and Health Departments and State Pollution Boards of Gujarat and
Maharashtra. Apart from these are the regulatory requirements dealing with taxation purposes. Resource
generation has been through raising money in the capital markets on the basis of its good reputation,
internal accruals, loans from commercial banks and financial institutions and sale of factory land at
Pune.28
Questions:-
1. Identify and discuss briefly, the three themes of strategy implementation of activating strategies,
managing change and achieving effectiveness in the case of Deepak Nitrite.
2. picking up data from the case, demonstrate how formulation and implementation of strategy are
interdependent.


BUSINESS STRATEGY KSBM ONGOING EXAM ANSWER SHEETS PROVIDED

BUSINESS STRATEGY KSBM ONGOING EXAM ANSWER SHEETS PROVIDED WHATSAPP 9924764558
CONTACT: DR. PRASANTH MBA PH.D. DME MOBILE / WHATSAPP: +91 9924764558 OR +91 9447965521 EMAIL: prasanththampi1975@gmail.com WEBSITE: www.casestudyandprojectreports.com

Business Strategy

Note:- 1) Kindly write case study number question number properly
2) Attached question papers with answer sheets
___________________________________________________________________________
Case 1 (20 Marks)
Door Darshan is the India’s premier public service broadcaster with more than 1,000 transmitters
covering 90% of the country’s population across on estimated 70 million homes. It has more than
20,000 employees managing its metro and regional channels. Recent years have seen growing
competition from many private channels numbering more than 65, and the cable and satellite
operators (C & S). The C & S network reaches nearly 30 million homes and is growing at a very fast
rate.
DD’s business model is based on selling half – hour slots of commercial time to the programme
producers and charging them a minimum guarantee. For instance, the present tariff for the first 20
episodes of a programme Rs.30 lakhs plus the cost of production of the programme. In exchange
the procedures get 780 seconds of commercial time that he can sell to advertisers and can generate
revenue. Break-even point for procedures, at the present rates, thus is Rs.75,000 for a 10 second
advertising spot. Beyond 20 episodes, the minimum guarantee is Rs.65 lakhs for which the
procedures has to charge Rs.1,15,000 for a 10 second spot in order to break-even. It is at this
point the advertisers face a problem – the competitive rates for a 10 second spot is Rs.50,000.
Procedures are possessive about buying commercial time on DD. As a result the DD’s projected
growth of revenue is only commercial time on DD. As a result the DD’s projected growth of revenue
is only 6-
10% as against 50-60% for the private sector channels. Software suppliers, advertisers and
audiences are deserting DD owing to its unrealistic pricing policy. DD has options before it. First, it
should privates, second it should remain purely public service broadcaster and third, a middle path.
The challenge seems to be exploit DD’s immense potential and emerge as a formidable player in the
mass media.
i. What is the best option, in your view, for DD?
ii. Analyse the SWOT factors the DD has.
iii. Why do you think that the proposed alternative is the best?
Case 2
In 2006-07 PTC Food division decided to enter the fast growing (20-30% annually) snacks segment,
an altogether new to it. It had only one national competitor-Trepsico’s Trito. After a year its wafer
snack brand- Ringo, fetched 20% market share across the country. Ringo’s introduction was
coincided with the cricket world cup. The wafer snacks market is estimated to be around Rs. 250
crores.
The company could take the advantage of its existing distribution network and also source potatoes
from farmers easily. Before the PTC could enter the market a cross-functional team made a customer
survey through a marketing research group in 14 cities of the country to know about the snacks of
eating habits of people. The result showed that the customers within the age-group of 15-24 years
were the most promising for the product as they were quite enthusiastic about experimenting new
snack taste. The company reported to its chefs and the chefs came out with 16 flavours with varying
tastes suiting to the targetted age-group.
The company decided to target the youngsters as primary target on the assumption that once they
are lured in, it was easier to reach the whole family.
Advertising in this category was extremely crowded. Every week two-three local products in new
names were launched, sometimes with similar names. To break through this clutter the company
decided to bank upon humour appeal.
The Industry sources reveal that PTC spent about Rs. 50 crores on advertisement and used all
possible media- print and electonic, both including the creation of its own website,
Ringoringoyoungo.com with offers of online games, contests etc. Mobile phone tone downloading
was also planned which proved very effective among teenagers. The site was advertised on all
dotcom networks. Em TV, Shine TV, Bee TV and other important channels were also used for its
advertisement along with FM radio channels in about 60 cities with large hoardings at strategic
places.
Analysts believes that Ringo’s success story owes a lot to PTC’s widespread distribution
channels and aggressive advertisements. Humour appeal was a big success. The `Ringo’ was made
visible by painting the Railway bogies passing across the States. It has also been successful to
induce Lovely Brothers’ Future Group to replace Trito in their Big-Bazaar and chain of food Bazaars.
PTC is paying 4% higher margin than Trepsico to Future group and other retailers.
Ringo to giving Trepsico a run for its money. Trito’s share has already been reduced considerably.
Retail tie- ups, regional flavours, regional humour appeals have helped PTC. But PTC still wants a
bigger share in the market and in foreign markets also, if possible.
Answer the following questions:
a) What is SWOT Analysis? (4 Marks)
b) What are the strength of PTC? (4 Marks)
c) What are the weaknesses of PTC for entering into the branded snacks market? (4 Marks)
d) What kind of marketing strategy was formulated and implemented for Ringo?
What else need to be done by Ringo so as to enlarge its market? (8 marks )
Case 3
Dr. Sukumar inherited his father’s Dey’s Lab in Delhi in 1995. Till 2002, he owned 4 labs in the National
Capital Region (NCR). His ambition was to turn it into a National chain. The number increased to 7 in
2003 across the country, including the acquisition of Platinum lab in Mumbai. The number is likely to go
to 50 within 2 – 3 years from 21 at present. Infusion of Rs.28 crores for a 26% stake by Pharma Capital
has its growth strategy.
The lab with a revenue of Rs.75 crores is among top three Pathological labs in India with Atlantic
(Rs.77 crores) and Pacific (Rs.55 crores). Yet its market share is only 2% of Rs.3,500 crores
market. The top 3 firms command only 6% as against 40 – 45% by their counterparts in the USA.
There are about 20,000 to 1,00,000 stand alone labs engaged in routine pathological business in
India, with no system of mandatory licensing and registration. That is why Dr. Sukumar has not
gone for acquisition or joint ventures. He does not find many existing laboratories meeting quality
standards. His six labs have been accredited nationally whereon many large hospitals have not
thought of accreditation. The College of American Pathologists accreditation of Dey’s lab would help it
to reach clients outside India.
In Dey’s Lab, the bio-chemistry and blood testing equipments are sanitized every day. The bar
coding and automated registration of patients do not allow any identity mix-ups. Even routine tests
are conducted with highly sophisticated systems. Technical expertise enables them to carry out
1650 variety of tests. Same day reports are available for samples reaching by 3 p.m. and by 7 a.m.
next day for samples from 500 collection centres located across the country. Their technicians work
round the clock, unlike competitors. Home services for collection and reporting is also available.
There is a huge unutilized capacity. Now it is trying to top other segments. 20% of its total business
comes through its main laboratory which acts as a reference lab for many leading hospitals. New
mega labs are being built to encash preclinical and multi – centre clinical trials questions.
i. What do you understand by the term Vision? What is the difference between ‘Vision’ and
‘Mission’? What vision Dr. Sukumar has at the time of inheritance of Dey’s lab? Has it been
achieved? ( 8 Marks)
ii. For growth what business strategy has been adopted by Dr. Sukumar?
. (2Marks)
iii.What is the marketing strategy of Dr. Sukumar to overtake its competitors?
. (6Marks)
iv. In your opinion what could be the biggest weakness in Dr. Sukumar’s business strategy?
. (4 Marks)
Case : 4 (20 Marks )
The origins of Deepak Nitrite—the flagship comp any of the Deepak group of industries-go back to 1970
when Chimanlal K. Mehta, an entrepreneur, sensing an opportunity in India’s drive towards selfsufficiency
and import substitution and relying on his trading and manufacturing experience, ventured into
the chemicals industry. The Company was originally incorporated as Deepak Nitrite Private Limited in
1970, under the Companies Act, 1956 and was subsequently converted into a public limited company in
the name of Deepak Nitrite Limited in 1971. The company’s registered office is at Vadodara and its
corporate office is at Pune with manufacturing plants in Gujarat and Maharashtra. Net sales for the year
ending March 2007 are about Rs. 4172 million and net profit is Rs. 357 million. Exports constitute nearly
half of the sales.
Overt he years, Deepak Nitrite has grown impressively through a judicious use of integration, related
diversification and internationalization strategies, using the means of acquisition and restructuring. In
1983, adopting a horizontal integration strategy, the company used foreign collaboration to start
commercial production of ammonia. In 1989, the group employed ammonia-based forward integration and
also diversified into the chemicals related area of methanol. In 1992 came the commercial production of
low-density ammonium nitrate, nitro phosphate and nitric acid, resulting in a multi-product portfolio
consisting of organic, inorganic, fine and specialty chemicals. Deepak Nitrite has made tremendous
progress over the years and has posted impressive financial results as well as excellent export
performance. It (the growth of the company), was born out of a process of deep thinking, strategy and
planning,’ said the managing director Deepak Mehta, who claims that planned strategy has led to growth.
Environmental scanning led to foreseeing the threats coming from a dismantled duty regime. Anticipating
this, the company went about implementing strategies that would convert these threats into opportunities.
The strategic approach was to build on its strengths in niche areas of the chemicals market, leverage
strong R & D and a robust lab to product ion skills, bring the strengths up to global levels and work
towards a leadership position.
The success of Deepak Nitrite could be attributed to its focused strategy. Implementation capabilities. A
series of plans, programmes and project have been initiated and implemented over the years, in
alignment with its corporate and business strategies. For instance, it has worked on a number of R&D
projects over the years to develop its skills to swiftly transfer products from the labs through production to
the markets. It has effectively developed differentiating capabilities by planning and implementing
projects for handling bulk products to handling batch products, transforming from a commodity supplier to
a value-added, branded product supplier with customization skills. Projects in supply chain management
have helped the company in extending its ability to source its own raw material to tracking customers’
delivery and inventory scheduling. Cost control has been attempted through wider sourcing; including
international vend ors, and investing in energy-saving equipments.
In the course of strategy implementation, Deepak Nitrite has to deal with a host of government agencies
for procedural implementation. For example, raising finance has taken it to SEBI. A continual interaction
takes place with the export and import regulatory authorities. For instance, anti-dumping duties have
been levied on the comp any for sourcing cheap materials from China. Being in the chemical processing
industry, the company is under the scrutiny of environmental protection agencies. It has been a signatory
to the ‘Responsible Care’ initiative of the global chemical industry. It has also achieved the ISO 14001
certification. Dealing with explosives, the company has to seek licenses from the Department of
Explosives, Industrial Safety and Health Departments and State Pollution Boards of Gujarat and
Maharashtra. Apart from these are the regulatory requirements dealing with taxation purposes. Resource
generation has been through raising money in the capital markets on the basis of its good reputation,
internal accruals, loans from commercial banks and financial institutions and sale of factory land at
Pune.28
Questions:-
1. Identify and discuss briefly, the three themes of strategy implementation of activating strategies,
managing change and achieving effectiveness in the case of Deepak Nitrite.
2. picking up data from the case, demonstrate how formulation and implementation of strategy are
interdependent.


BUSINESS STRATEGY KSBM MBA EXAM ANSWER SHEETS PROVIDED

BUSINESS STRATEGY KSBM MBA EXAM ANSWER SHEETS PROVIDED
CONTACT;

DR. PRASANTH MBA PH.D. DME MOBILE / WHATSAPP: +91 9924764558 OR +91 9447965521 EMAIL: prasanththampi1975@gmail.com WEBSITE: www.casestudyandprojectreports.com
Business Strategy
N.B: 1} Attempt all questions
______________________
Section A
Case – 1 Marks-16
Leisure and entertainment usually gain prominence in an economy that is growing; fast and provides leeway
to the consumer to spend on things other than necessities India’s entertainment and media industry is one
of the sunrise industries, growing at a Compound annual growth rate of 18 per cent, much faster than the 9
per cent national economic growth rate. According to a study conducted by the Federation of Indian
Chambers of Commerce and Industry and PricewaterhouseCoopers the industry size is Rs. 437 billion
presently and is projected to grow to Rs. 1 trillion by 2010. Positive measures taken by the government,
technological advancement and entry of large corporate houses in all the segments of the industry are
fuelling the impressive growth.
Among the various segments of the industry, there, are radio, television, films, out-of-home advertising arid
live entertainment While radio and television make up the fastest growing segments, film entertainment
growing at 16 per cent annually, is another potential segment. The film entertainment segment of the
entertainment and media industry has several strategic groups that could be roughly categorized along the
value chain of film making and distribution These strategic groups could be production, distribution, retail,
music and home video. While many of the companies operate in more than one activity area on the value
chain, such as Yash Raj Films operating in all activity areas except retail, there are a few that concentrate
on just one or two activity areas, such as RGV Film Factory that operates only in production of films. Size
based on revenue could be another basis for categorization of the film entertainment companies in India.
Among the large size companies are Adlabs, Sahara, Percept, Yash Raj Films and UTV, that could touch or
exceed Rs. 1000 revenues by 2010. The middle-rung is of companies of revenue size of Rs. 300 — 500
crore, such as pure retail distribution companies such as lnox Leisure, P’SR Cinemas, Pyramid Saimira and
Valuable Group pure content companies such as Pritish Nan Communications Vishesh Films or RGV F
Factory. The third category is of emerging companies in the revenue size range of Rs. 1OC — 300 crore,
such as Real Image, Red Ice and Seven Entertainment Major investments in the media and entertainment
industry in recent years have been ploughed into infrastructure, largely into multiplex chains and digital
theatre chains. These investments are made by companies that are pure retail and distribution companies.
Among the major ones in this strategic group is the Chennai-based Pyramid Saimira Theatre Limited (PSTL)
– India’s largest theatre chain company with over 29 multiplexes operation, with over 371 screens in 2007,
project to increase to 2000 screens by 2010. It was incorporated in 1997 as Pyramid Films international
Private Limited and has gone through severe changes of name to emerge as Pyramid Saimira Theatre
Limited, reflecting its concentration on the theatre business, though it operated in film production and TV
content production in the past Film making and distribution in India has been traditionally an unorganized
and fragmented industry, managed through experience rather than systems. In recent years, one trend in
the film industry is corporatization Under corporatization the traditional organizations dealing with the
various aspects of film making’ and distribution. Become formal organizations registered under the legal
process, such as the Companies Act, 1956. Along with corporatization comes increasing professionalization
in the management of organizations. Technology, especially information and communication technology, has
played its part in heightening the chances of making corporatization and professionalization successful A
new breed of organization has emerged on the horizon that deals with the various activities in an organized
and Systematic manner. Pyramid Saimira intends to be of such organizations. The people behind Pyramid
Saimira include Mr. V. Natarajan, a Gemini-studio’s veteran of the Tamil film industry, Mr. P. S.
Saminathan, the finance and technology brain behind the flagship project and Mr. N.Narayanan, the
management man. The financials for the year 2006-2007, show net sales of Rs 1661.52 crore and net profit
of Rs. 158.82 crore on equity capital of Rs. 282.76 crore.
The flagship project of the Pyramid Saimira is the mega digital. Theatre chain project being implemented in
two phases, with a total cost of Rs. 414.5 crore. This is an information technology driven venture that is a
first-mover in the film industry in India. The basic idea is to have a chain of theatres for exhibition of films
that have been encrypted in the digital medium. The theatres are linked through a satellite-based
communication network. The films are released in the digital format and simultaneously exhibited in the
digitally- enabled theatres through the satellite network. The one-stroke release and exhibition of films is
claimed to reduce the chances of films being pirated, which is the Achilles’ heel of the film
industry in the world. It also avoids the use of costly film rolls and reels now used to photograph and
distribute films. The digitized theatres also offer the potential of developing them as value-added service
providers, enlarging their role from that of entertainment providers to commercial infrastructure providers
such as shopping malls, exhibition spaces and education and training venues.
The business model of the digital theatre concept is based on a vertically-integrated theatre chain on longterm
lease, where the revenue streams emanate mainly from the ticket sales at the individual theatres at
the demand end, much like it does now. The critical difference is on the supply side where the distribution,
retailing and exhibition of films are done in an integrated manner through digital means connected through
a communication network. This effectively eliminates the film distributor and tries to achieve economies of
scale through volume sales. The centralized network operating centre is the nodal supply point.
A standardized delivery process makes the process operationally low-cost, albeit at a high initial investment.
Additional revenue streams, generated through exploitation of the theatre infrastructure to provide other
services than entertainment, help to recoup the high initial investment. Creating a franchise system for a
long-term lease enables sharing of the initial high costs7 of realty by engaging partners who own the
theatre space but use Pyramid Saimira’s digital distribution and exhibition facilities at a price. There are
additional possibilities of creating content library of films, extending networks abroad and building
integrated family entertainment centers.
The digital theatre is a compact model, having various elements such as digital projectors, servers,
connectivity equipments, high-definition recorder and telecine, system integration and software solution
providers. For each of these, there are in-house and external agencies in partnership. For instance,
connectivity equipments are being provided by Tata Net while servers are arranged by a partnership of
Saimira Access Technologies with Real Image Media.
Pyramid Saimira’s SWOT analysis indicates the following factors:
• Strengths Established organization, experienced promoters and networking with financially strong and
capable partners.
• Weaknesses Lack of in-depth technological experience, risks of being the first-mover and limited financial
capability.
• Opportunities Favorable demographics, increasing spending on entertainment, potential expatriate
demand, availability of technological infrastructure such as broadband and digitized films a regenerative
asset that has multiple uses.
• Threats Unorganized film industry, fickle nature of demand for films, powerful industry bodies with political
lobbying capabilities, high entertainment taxes, piracy, high cost of infrastructure and faulty governmental
policy implementation.
Pyramid Saimira’s global ambitions are reflected in its vision statement, which is ‘to be the largest vertically
integrated theatre chain in the world carving a unique space in mass access using theatre infrastructure to
deliver education, entertainment and information at affordable cost to all sections of society’. The digital
theatre project is being implemented in Tamil Nadu and is planned to be expanded throughout India and
abroad in areas where there are a large number of Indian expatriates such as South East Asia, Europe and
the U.S. The acquisition of the Texas-based Fun Asia made through the subsidiary Pyramid Saimira
Entertainment America, targeting the Asian film market, marked the entry of Pyramid Sairnira in the U.S.
and Canada. There are subsidiaries operating in Singapore and Malaysia, where there is a substantial
number of people of Indian origin.
Questions:- (Any Two)
1. Attempt a Porter’s five- forces analysis for the Indian film industry, highlighting the factors relevant for
Pyramid Saimira’s strategic planning.
2. Attempt a strategic groups analysis highlighting the factors relevant for Pyramid Saimira’s strategic
planning.
3. Identify the subjective factors that may have an impact on the strategic choice made Pyramid Saimira.
Case –2 Marks-16
The origins of Deepak Nitrite—the flagship comp any of the Deepak group of industries-go back to 1970
when Chimanlal K. Mehta, an entrepreneur, sensing an opportunity in India’s drive towards self- sufficiency
and import substitution and relying on his trading and manufacturing experience, ventured into the
chemicals industry. The Company was originally incorporated as Deepak Nitrite Private Limited in 1970,
under the Companies Act, 1956 and was subsequently converted into a public limited company in the name
of Deepak Nitrite Limited in 1971. The company’s registered office is at Vadodara and its corporate office is
at Pune with manufacturing plants in Gujarat and Maharashtra. Net sales for the year ending March 2007
are about Rs. 4172 million and net profit is Rs. 357 million. Exports constitute nearly half of the sales.
Overt he years, Deepak Nitrite has grown impressively through a judicious use of integration, related
diversification and internationalization strategies, using the means of acquisition and restructuring. In 1983,
adopting a horizontal integration strategy, the company used foreign collaboration to start commercial
production of ammonia. In 1989, the group employed ammonia-based forward integration and also
diversified into the chemicals related area of methanol. In 1992 came the commercial production of lowdensity
ammonium nitrate, nitro phosphate and nitric acid, resulting in a multi-product portfolio consisting
of organic, inorganic, fine and specialty chemicals. Deepak Nitrite has made tremendous progress over the
years and has posted impressive financial results as well as excellent export performance. It (the growth of
the company), was born out of a process of deep thinking, strategy and planning,’ said the managing
director Deepak Mehta, who claims that planned strategy has led to growth. Environmental scanning led to
foreseeing the threats coming from a dismantled duty regime. Anticipating this, the company went about
implementing strategies that would convert these threats into opportunities. The strategic approach was to
build on its strengths in niche areas of the chemicals market, leverage strong R & D and a robust lab to
product ion skills, bring the strengths up to global levels and work towards a leadership position.
The success of Deepak Nitrite could be attributed to its focused strategy. Implementation capabilities. A
series of plans, programmes and project have been initiated and implemented over the years, in alignment
with its corporate and business strategies. For instance, it has worked on a number of R&D projects over
the years to develop its skills to swiftly transfer products from the labs through production to the markets.
It has effectively developed differentiating capabilities by planning and implementing projects for handling
bulk products to handling batch products, transforming from a commodity supplier to a value-added,
branded product supplier with customization skills. Projects in supply chain management have helped the
company in extending its ability to source its own raw material to tracking customers’ delivery and
inventory scheduling. Cost control has been attempted through wider sourcing; including international vend
ors, and investing in energy-saving equipments.
In the course of strategy implementation, Deepak Nitrite has to deal with a host of government agencies for
procedural implementation. For example, raising finance has taken it to SEBI. A continual interaction takes
place with the export and import regulatory authorities. For instance, anti-dumping duties have been levied
on the comp any for sourcing cheap materials from China. Being in the chemical processing industry, the
company is under the scrutiny of environmental protection agencies. It has been a signatory to the
‘Responsible Care’ initiative of the global chemical industry. It has also achieved the ISO 14001 certification.
Dealing with explosives, the company has to seek licenses from the Department of Explosives, Industrial
Safety and Health Departments and State Pollution Boards of Gujarat and Maharashtra. Apart from these
are the regulatory requirements dealing with taxation purposes. Resource generation has been through
raising money in the capital markets on the basis of its good reputation, internal accruals, loans from
commercial banks and financial institutions and sale of factory land at Pune.28
Questions:-
1. Identify and discuss briefly, the three themes of strategy implementation of activating strategies,
managing change and achieving effectiveness in the case of Deepak Nitrite.
2. picking up data from the case, demonstrate how formulation and implementation of strategy are
interdependent.
Case –3 Marks-16
Synergos# is a young management and strategy consulting firm based at Mumbai. It was established in
1992 at a time when there were a lot of expectations among the industry people from the liberalization
policies that were started the previous year by the Government of India.
The consulting firm is an entrepreneurial venture started by Urmish Patel, a dynamic person who worked
with a multinational consulting-firm at the He left his comfortable position there to venture into the
management consultancy industry the motivation was to be ‘the master of his own destiny’ rather than
being an employee working for others. Urmish comes from an upper middle-class Gujarati family, settled in
a small town in Rajasthan. His father was a government servant who retired with a meagre pension. His
mother is a housewife. His other siblings are all educated and well-settled in their respective careers and
professions. Urmish is a creative individual, uncomfortable with the status-quo. During his student days at a
college at Jaipur, he was continually coming up with bright ideas that some of his friends found to be
preposterous. To him, however, these were perfectly achievable ideas. He studied biotechnology and then
went to the US on a scholarship to do his Masters. After a semester at a well-known university there, he lost
interest and switched to pursue an MBA. He liked it and soon settled down to work with n American
consultancy firm and toured several countries on varied assignments during the seven years he worked
there. In 1992 came the urge to Urmish to chuck his job and be on his own. It was a risky, yet an exciting
step to take. His accumulated capital was limited— just enough to rent office space, buy a few computers
and hire an assistant. There were no consultancy assignments for the first three months. But an
acquaintance soon came to his aid, introducing him to the CFO of a major family business group who
needed advice on a performance improvement project they wanted to launch. The opportunity came in
handy though the returns were nothing to write home about. That project was the first step to many more
that came gradually. Synergos started gaining presence in the competitive management consultancy
industry and attracting attention from the people whom they worked for. Word-of-mouth publicity led them
from one project lo another for the first three years till 1995. Synergos took up whatever came its way,
delivering a cost-effective solution to its clients. A team of four had formed by now, each member of the
team specializing in services rendered to the clients. For instance, one of the members is a specialist in
engineering projects, while another has expertise in finance. The third one is a service sector specialist, also
having experience in dealing with government matters.
The phase of rapid growth started some time in 1995 when the Synergos team decided to focus on the
small and medium enterprises (SMEs). These were firms that realized they had problems needing specialist
advice; but were apprehensive to app roach the big firms on account of their limited outlay and
inexperience of dealing with such firms. Synergos came to their aid by tailoring their services as near as
possible to their needs. Another differentiation platform Synergos offered to its client was a fully-integrated
consultancy service where it got involved right from the stage of planning down to its implementation and
monitoring.
Presently, Synergos has grown to be a medium- sized consultancy firm, serving clients in India and abroad,
working for industries ranging from auto components to financial services and for manufacturing
organizations to service providers. Somehow, nearly half of the assignments it has worked on have been for
mid-sized, upcoming family- owned businesses, a niche it has served well. These organizations typically
need a boutique sort of consultancy that can offer customized services dealing with a broad range of
practices related to strategy, organization design, mergers and acquisitions and operational matters such as
logistics and supply-chain management. Synergos fits in with their requirements owing to its personalised
service and reasonable-commission structure. The organizational structure at Synergos has a board at the
top, consisting of seven people, including the four founding members and three independent directors. One
of the independent directors is the chairman of the board. Urmish, as the founder CEO, also heads an
executive management committee with each of the founding. Members, leading three other top-level
committees dealing with business portfolio, service management and executive recruitment.
The management team is called the professional group. The rest of the employees are ref erred to as the –
staff. -The professional group has young women and men who are graduates from some of the best
institutions in India and abroad. They are assigned to taskforces based on their qualifications, experience
and interests. The departmentation at Synergos is flexible, based on -an interplay of the three categories:
skill, service and specialty. For instance, a professional may have IT skills, may have worked to provide
supply- chain management services and developed expertise in handling operational assignments for
medium-sized food and beverage firms. There is a lot of multi-tasking however, to utilise the wide – range
of skills and special expertise that the professionals have For administrative matters the professionals are
assigned to client-service departments of industry solutions, enterprise solutions and technology solutions.
The flexibility that such an organisational arrangement affords seems to have been the major reason for the
evolution of the organization structure at Synergos over the years.
The staff group of employees consists of the support people who provide a variety of services to the
professionals. Among these are research assistants, industry analysts, documentation experts and
secretarial staff. There is no set pattern for assignment of staff to the administrative departments and
generally, a need-based approach is followed, depending on the workload at a particular time.
Recruitment for professionals is stringent. Synergos typically looks for a good combination of education and
experience and lays much emphasis on the compatibility of the prospective employee with the shared
values. Creativity, broad range of professional interests, intellectual acumen, team- working and physical
fitness to undertake demanding tasks and work for long hours are the criteria for hiring. There are not many
training opportunities except the on-the-job learning. New professionals are assigned to a mentor for some
time till they a ready to handle assignments autonomously. The staff members are usually recruited from
fresh graduates, with good degrees from reputed institutions, in arts, sciences and commerce. The staff
positions are also open for persons wanting to work on part-time or project-bases. Emphasis is given to the
ability of the prospective staff to undertake multi-tasking and work with documentation and word processing
and presentation software packages.
The compensation system consists of a base salary with commission and bonus depending on performance.
There are other usual elements such as medical reimbursement, loan facility and gratuity and retirement
benefits. The performance appraisal is informal, with at least one of the four founding members being part
of the evaluation committee for a professional. Usually, the found-c member closest to the work area of the
employee is involved in determining the rewards to be give’. The time-cycle for appraisal is one year.
Management control is discreet and performance-based rather than behavior-based. The means for control
are informal, such as direct supervision. Urmish is a strong proponent of the emergent strategy and is not in
favor of tying Synergos to a fixed strategic posture. So are the other founder members, though at times
they do talk about deciding on a niche such as the SME organizations as clients and enterprise solutions as
the core competence. In the highly fragmented consultancy industry where it is possible for even one
person to s up an office in a commercial area and leverage corrections to secure projects, Synergos is open
opportunities as they emerge, while trying to maintain the flexibility that has made it successful till no
Questions :- (Any Two)
1. Identify the type of organization structure being used at Synergos and explain how t works. What are the
benefits of using this type of structure? What are the pitfalls?
2. Express your opinion about whether the structure is in line with the requirements of the strategy that
Synergos is implementing.
3. Based on the information related to the information, control and reward systems available in the case,
examine whether these systems are appropriate for the type of strategy being implemented.
Section B
1. Select any organization of your choice. Identify the high priority environmental factors in its
relevant environment. Use the information to prepare a summary ETOP for the organization.
2. Which sector of environment is currently relatively more important, In general, in the Indian
context? What sectors are likely to gain importance in the near future?
3. Describe the different ways in which digitalization can help organizations in achieving cost
leadership, differentiation and focus.
4. Describe the contents of a good and workable strategic plan for a large business group or a
public sector enterprise in India.

KAZIAN GLOBAL SCHOOL OF BUSINESS MANAGEMENT
MARKS: 80
COURSE: EMBA Sem-I
SUBJECT: Consumer Behavior
___________________________
Section A
Case – 1 -Fashion Statement through Khadi
As India’s traditional hand-spun cotton fabric, khadi feels coarse and unrefined. But the feelings it evokes
in anyone with any empathy in India’s heroic struggle for emancipation from colonial rule, is anything but
that.
Till date the fabric bears the invisible-but-indelible imprint of the charkha (spinning wheel), the late
M.K. Gandhi’s revolutionary symbol for self-reliance and emancipation (through unity, expressed in the
refusal to kneel before insolent might). Instead of exporting raw cotton and importing fine Manchestermade
cloth, freedom fighters wanted all Indians to spin their own clothing and boycott imports to weaken
the British Raj.
With the end of Colonial Rule in 1947, the congress government headed by Jawaharlal Nehru opted
for state-led large-scale industrialization, instead of Gandhi’s idea of rule hut-industry development. But it
also decided to provide employment to thousands of spinners by selling their output through a vast
network of retails stores.
Thus was formed the Khadi and Village Industries Commission (KVIC), a nodal agency to promote
the fabric, with its Khadi Bhandar outlets in urban India.
Over the years, KIVC set up thousand of outlets across India. Sales were good. But with the
evolution of technology, perhaps it was inevitable that the sentimental dreams of village self-reliance
would be disrupted. And so it was. Modern machines of Europe’s industrial revolution were soon to arrive.
Indian industrialists set up capital-intensive textile mills and began the mass-production of fine cloth. As
the mills gained volume, they achieved economies of scale and started lowering prices. And so, the
labour-intensive homespun fabric losing out to mill fabric.
Driven by its sentimental attachment to Khadi, and concern for mass-scale-sector employment, the
government started subsidizing India’s traditional spinners. This was an extension of its ‘tax-the-rich’ and
‘feed-the-poor’ outlook, and was projected via the media as a good thing. In any case, KVIC was intended
to be a noble organization, motivated by lofty ideals instead of profit. For decades, all was fine behind the
‘khadi’ curtain of socialism’. The reason behind the support mechanism even acquired a holiness of its
own. Institutionalized, it became immune to doubt. But alas, the system was artificial and its main flaw lay
in the very ‘certain’. Public information was lacking, and so it escaped proper scrutiny. In the real would,
even the best-international projects can fail, or worse, degenerate into instruments for patronage.
But the 1990s, the vision of clothing the masses with khadi was beginning to look absurd. Despite
all policy incentives to the sector, people were buying efficiently machine-made textiles. The forces of
mass production were making polyester, which had gained economies of scale at the raw materials stage
(made from petrochemicals), cheaper still. Yet KVIC continued to produce huge quantities and sell khadi
clothes through its extensive retail chain. By now, khadi was more expensive than other fabrics and had
acquired the image of an outdated clothing material worm chiefly by politicians and social workers.
Ordinary people preferred cheaper alternatives.
Was khadi a lost cause-stuck in the time wrap? Clearly, if KVIC continued the way it was; it was
headed for trouble. Given India’s poor fiscal health, subsidies had become untenable. Yet, the fabric
couldn’t be torn out from consciousness of caring Indian. Something needed to be done. And fast.
By the start of the new century, KVIC discovered a pragmatic solution based on using modern
marketing to revive the fabric. After all, the Free Market can also accommodate common sentiments.
Instead of directing taxpayers’ money towards the cause, it was thought that private citizen should
contribute on their own volition (by buying khadi at premium prices).
The strategy? Refurbish the range, acquire an upscale image, aim the cloths at the well off and
reposition khadi as a fashion statements. Given KVIC’s lineage, the idea was radical. But it was worth a
try. KVIC started with a single-outlet experiment in Delhi’s Khan Market. The first air-conditioned shop
opened here in May 2001, selling khadi muslin garments designed by high-profile designers (Rohit Bal and
Malini Ramani), in addition to a well-packaged range of Ayurvedic products. It was a runaway success,
with Delhi’s elite thronging the shop.
KVIC started marketing two brands, Khadi and Sarvodaya, to which it owns the rights. The former
caters to the premium and export segments, and include essential oils, herbal oil soaps, face scrubs, and
dry fruits honey. Sarvodaya, the mass-market brand, sells mass items such as toilet soap, honey, pickles,
spices and incense sticks.
The move has also sparked off a controversy. Some Gandhians, troubled by the glamour, are
aghast at this ‘betrayal of ideals’. Realists, however, criticize them for failing to free themselves of their
dearly held ‘khadi mindset’. Don’t get them wrong. The latter love the old idealism too. But they also
realize that a product with great symbolic value deserve to be marketed as such, if it is to reach out, and
with mind-space for the poor weaver’s child who might have something to offer if given a chance. Holding
Gandhi’s method (or tools) as sacred amounts to confusing the means with the end.
The capital’s response to Khan Market shop has been so good that KVIC wants to upgrade a
significant fraction of its network. The transformation is to be entrusted to a new marketing company that
will function as any other professional firm. Plans to extend the concept include display units at airports
and modern outlets at Delhi’s Ashoka Hotel, Nehru Place, Hauz Khas, and Kamla Nagar. Next on the
agenda: Jaipur, Chandigarh and Lucknow. What’s more, the sales personnel are to be retrained for
customer orientation at the shop-floor level. The sale boost is expected to be substantial. The Khadi Gram
Udyog store at Connaught Place, New Delhi does an annual turnover o Rs. 10 crore. After renovation, this
is expected to touch close to Rs. 25 crore.
The product range will be widened too. Ahmedabad’s National Institute of Design (NID) has
proposed a special cell for design support, while Delhi’s National Institute of Fashion Technology (NIFT)
may also pitch in.
KVIC has hired three and agencies to promote its brands: Appeal for Khadi; Market Missionaries for
Sarvodaya and Pressman for the corporate and promotional schemes. The budget is about 25 crore. Khadi
campaign is likely to start by highlighting the brand’s eco-friendly credentials, before turning attitudes
towards it and portraying it as a lifestyle insignia.
Vivek Sahni has been roped in to do the packing graphics and retail outlets. E-commerce options
are also being weighed, with KVIC having already booked khadi.com and khadi.org as its domain names.
The export thrust will also be sharpened. Right the around 200 production units, which cater
exclusively to the export to the market. KVIC wants to identify new markets and tap them with its
products. Test marketing efforts are already underway in South Africa, Dubai, and a few other overseas
markets.
QUESTIONS:-
1. Would marketing in foreign countries require study of a popular country’s culture aspects and
buyer behaviour before marketing Khadi there? What aspects would need to be studied?
2. Suggest an approach to make Khadi garments popular among Indian youth.
Case-2- Purchase of a Microwave Oven
Ramesh Sikand and his family lived a comfortable two-bedroom flat in a respectable locality in a large
city. He was employed with a general insurance company in a supervisory capacity. His wife, Sumita was
a teacher in an English medium public school. Both their children, Rachit aged 10 and Sarita aged 8
years, were studying in the same school where Sumita was employed.
Just before Diwali in 2002, one Friday evening the family went shopping. Besides clothes for
children and few other things, they bought a 27 liter. Excel microwave from an outlet with good
reputation. Sumita was very happy and the children were excited with this new purchase. Both the
children were anticipating quick cooking of a variety of dishes they liked. They were expecting that
everyday their mom would give them school Tiffin-boxes packed with noodles other Chinese food.
To celebrate, Sumita invited two of her school colleagues for dinner and prepared a few dishes in
her brand new microwave. Both her friends observed her cooking with great interest. On the dinner table
most talk was around difficulties of both spouses being employed and the shortage of time to attend to so
many household chores. The friends, Ramesh and the kids profusely praised the dishes and how quickly
everything for the dinner was ready. What really took most time was cooking the Chapatis. Sumita said,
“ How nice and convenient it can be if some portable chappati-preparing gadget was available.”
Ramesh said, “It was my idea to buy a microwave. “Sumita said, “Why? You have forgotten. It
was I who two years ago during exam time suggested that it would be good if we buy a microwave.” Both
of them were trying to take credit for the purchase. Finally, both of them agreed that the idea to buy a
microwave was discussed after they attended the dinner at a friend’s place where for the first time they
saw a microwave in operation.
One of Sumita’s friends asked, “why did you buy this particular brand? I have read in the
newspaper just a few days back that there are attractive schemes on some brands.” Sumita and Ramesh
spoke simultaneously,” In fact, both of us have read advertisements and articles in magazines within the
last six months about what features and benefits every brand offers. “Sumita said, “As and when I got
the opportunity, I consulted some of my knowledgeable friends who have owned microwaves for quite
some time, what to look for and what brands to consider.” “You know, I came across some scaring
information about the safety of microwaves. Now the technology is so advanced that all those scaring tit
bits of information are quite baseless. ”Ramesh said, “Whatever we learned from magazine articles and
experienced friends has helped us quite a lot in buying this brand.” Sumita said, “About schemes, you are
right. We too got a set of three bowls to be used for microwave cooking. Besides, we have paid just a
thousand rupees and the rest would be paid in fifteen interest free installments. There is an extended
warranty of three years, and if we are not satisfied with the machine, we can return it within the first 30
days of purchase, and no questions asked. Our Rs.1,000 would be refunded in cash.”
One of Sumita’s friend said, “Recently, one of my relations in Delhi told me her bad experience with
this brand. She went to the extent of suggesting me never to buy this brand of microwave.” Ramesh said,
“I don’t know what to say about your relation’s experience. What information we could collect goes quite
in favor of this brand. Those who recommended it have had few years use experience without any
complaints.” Sumita’s friend said, “You may be right Bhaisaheb. But one thing we all know is that these
are machines and they are not perfect. Excellent cars with unmatched reputations like BMW, Rolls Royce,
and Mercedes too, need repairs.” She smiled, and said, “Haven’t you heard of Murphy’s Law “If a thing
can go wrong, it will”.
At about 10.30 pm, the friends thanked Sumita and Ramesh, and congratulated them for owning a
microwave and left. Sumita and Ramesh were a bit pensive after their departure. They felt somewhat
uneasy about the correctness of their decision in choosing this particular brand of microwave. They knew
their money was safe, but it would be embarrassing if they had made a mistake. They agreed to discuss
the matter with some of their eexperience3d friends.
QUESTIONS:-
1. Discuss whose decision it was to buy a microwave and when was the purchase decision made.
2. What factors influenced the purchase of the microwave?
3. What is likely to be the post-purchase behavior in this case and what is the significance of such
behavior?
4. What is the significance of post-purchase behavior for the marketer?
Case-3- Fancy Dreams
The boardroom was filled with the voice of marketing manager, Ashutosh Kant. He was addressing the
meeting of senior managers of Fancy Dreams. “The last three months were spent by our market research
team in finding out the reasons and patterns of sales at stores. Let me emphasize that retail sales is
showing growth all over the country and in the process, competitions is intensifying. We can no longer
afford to sit and relax, instead we need to put ourselves fully to retain our market leadership.” There facts
revealed by the survey were particularly disturbing.
1. People found Fancy Dreams service staff bordering on aggressiveness and not really helpful, as
customers were never left to browse.
2. Children got bored and hence parents often left the store within minutes after finishing essential
shopping. They never browsed or spent leisure time at Fancy Dreams store, which could otherwise
help promote sales.
3. With many choices available in the market, consumers stopped treating Fancy Dreams store as
unique and exclusive anymore.
Rehman, an entrepreneur, had set up a garment shop in one of Delhi’s busy up market area about 10
years ago. He realized that to attract customers, he must do something new. With this in mind, he
chalked out a detailed plan to open a chain of stores called Fancy Dreams. Some major features of this
store were:
1. Complete dress range for kids, parents and teenagers.
2. Full accessories for women and in footwear, purses, jewelry and cosmetics.
3. A play center where kids could spend time when the parents shopped.
The stores were opened in two locations in Delhi on an area of 10,000 sq.feet each. Within six
months, the stores became popular and the business grew rapidly and in three years the turnover crossed
Rs.6 crore. The promotion plans included advertising in print media and through cable operators. The
store also conducted festivals such as children’s carnival, and Valentine special etc., to attract crowds of
customers.
Stress on store ambience was high as Rehman wanted to create an image of a complete shopping
experience for the entire family. The sales personnel were carefully selected and trained to promote, not
push, any product and to encourage customers to browse through.
The women’s section was given a feminine touch and the men’s section had polished wood and leather
all over. The garments, the accessories, and the gifts were displayed in large racks and
Full-length mirrors were placed in multiple places. Sales personnel present on all the three floors often
advised the customers but never showed around everything. The kid’s section included garments, toys,
books, and was manned by more staff. The play center for the kids was a major attraction. The parents
could safely leave their children in the place, situated on the ground floor itself. The place had separate
section of toys and books for children and was supervised by trained staff. They felt comfortable that
their children would be taken care off properly and the parents, therefore, could leave the children and
shop in a relaxed manner. This concept was unique and highly appreciated by customers and became the
major attraction for them.
The stores were one of a kind in the early 1990s and grew rapidly. The new sections on books, gifts,
and handicrafts were launched gradually and at any time the store had more than 200 categories of
products. During this time, the competition started intensifying as three similar ventures were launched in
the city. This didn’t bother Rehman much, because he felt he had built and image of Fancy Dreams being
the ultimate store. By 1996, multi-storey, one-stop stores became the trend in Delhi and many such
stores came up.
Rehman had expanded his stores in three other cities as well and the turnover had crossed Rs.40
crore. The total manpower rose to 500 and several new management and non-management cadres were
introduced in the company.
Last year during Diwali festival season, the store attracted nearly 40,000 customers in the entire
month. This worried Rehman as it was almost 20 percent less than their estimates. His marketing
manager, after ling discussions, hired a market research firm to study the buying pattern and preferences
of people walking in the store.
QUESTIONS:-
1. Identify the relevant major problems and issues in this case.
2. Suggest a strategy to rectify the problems.
Section B
1. You are the brand manager of a new line of light weight autofocus, economically priced digital cameras.
Describe how an understanding of consumer behaviour will help you in your segmentation strategy and
promotion strategy. What are the consumer behaviour variables that are crucial to your understanding of
this market?
2. Gillette, an established market leader in shaving products, is planning a foray into skin care products
for men. How can the company use stimulus generalisation to market these products? Can instrumental
conditioning also be applied in this marketing situation? How?
3. Which of the stages of the family life cycle would constitute the most lucrative segment/segments for
the following products and services?
(a) Domino’s pizza
(b) Mobile telephones
(c) Mutual funds
Justify your answer.
4. What do you understand by extensive problem solving, limited problem solving and routinised response
behaviour? What kind of decision process can you expect in the following cases and why?
(a) Purchase of a greeting card for a close friend.
(b) Purchase of an after shave lotion/moisturizer.

KAZIAN GLOBAL SCHOOL OF BUSINESS MANAGEMENT
MARKS: 80
COURSE: EMBA (Sem-I)
SUBJECT: General Management

_____________________________________________________________________________
Section A
Case – 1
‘That’s not my job’ – Learning delegation at Cin-made
When Robert Frey purchased Cin – Made in 1984, the company was near ruin. The Cincinnati, Ohi-based
manufacturer of paper packaging had not altered its product line in 20 years. Labor costs had hit the
ceiling, while profits were falling through the floor. A solid quarter of the company’s shipments were late
and absenteeism was high. Management and workers were at each other’s throats.
Ten years later, Cin – Made is producing a new assortment of highly differentiated composite
cans, and pre-tax profits have increased more than five times. The Cin – Made
workforce is both flexible and deeply committed to the success of the company. On-time delivery of
products has reached 98 percent, and absenteeism has virtually disappeared. There are even plans to
form two spin – off companies to be owned and operated by Cin-Made employees. In fact, at the one day
“Future of the American Workforce” conference held in July 1993, Cin-Made was recognized by President
Clinton as one of the best – run companies in the United States.
“How did we achieve this startling turnaround?” Mused Frey. “Employee empowerment is one
part of the answer. Profit sharing is another.”
In the late spring of 1986, relations between management and labor had reached rock bottom.
Having recently suffered a pay cut, employees at Cin- Made came to work each day, performed the duties
required of their particular positions, and returned home-nothing more. Frey could see that his company
was suffering. “To survive we needed to stop being worthy adversaries and start being worthy partners,”
he realized. Toward this end, Frey decided to call a meeting with the union. He offered to restore worker
pay to its previous level by the end of the year. On top of that, he offered something no one expected: a
15 percent share of Cin-Made’s pre-tax profits. ” I do not choose to own a company that has an
adversarial relationship with its employees.” Frey proclaimed at the meeting. He therefore proposed a
new arrangement that would encourage a collaborative employee-management relationship “Employee
participation will play an essential role in management.”
Managers within the company were among the first people to oppose Frey’s new idea of employee
involvement. “My three managers felt they were paid to be worthy adversaries of the unions.” Frey
recalled. It’s what they’d been trained for. It’s what made them good managers. Moreover, they were
not used to participation in any form, certainly not in decision making.” The workers also resisted the
idea of extending themselves beyond the written requirements of their jobs. ” (Employees) wanted
generous wages and benefits, of course, but they did not want to take responsibility for anything more
than doing their own jobs the way they had always done them,” Frey noted. Employees were therefore
skeptical of Frey’s overtures toward “employee participation.” “We thought he was trying to rip us off
and shaft us,” explained Ocelia Williams, one of many Cin-Made employees who distrusted Frey’s plans.
Frey, however, did not give up, and he eventually convinced the union to agree to his terms. ” I
wouldn’t take no for an answer,” he asserted. “Once I had made my two grand pronouncements, I was
determined to press ahead and make them come true.” But still ahead lay the considerable challenge of
convincing employees to take charge :
I made people meet with me, then instead
Of telling them what to do, I asked them.
They resisted.
” How can we cut the waste on his run ?” I’d say, or “How are we going to allocate the
overtime on this order ?”
“That’s not my job,” they’d say.
“But I need your input,” I’d say. “How in the
World can we have participative management
If you won’t participate?
“I don’t know,” they’d say. “Because that’s
not my job either. That’s your job. ?”
Gradually, Frey made progress. Managers began sharing more information with employees.
Frey was able slowly to expand the responsibilities workers would carry. Managers who were unable to
work with employees left, and union relations began to improve. Empowerment began to happen. By
1993, Cin Made employees were taking responsibility for numerous tasks. Williams, for example, used to
operate a tin-slitting machine on the company’s factory floor. She still runs that same machine, but now
is also responsible for ordering almost $ 100,000 in supplies.
Williams is just one example of how job roles and duties have been redefined throughout Cin-
Made. Joyce Bell, president of the local union, still runs the punch press she always has, but now also
serves as Cin- Made’s corporate safety director. The company’s scheduling team, composed of one
manager and five lead workers from various plant areas, is charged with setting hours, designating
layoffs, and deciding when temporary help is needed. The hiring review team, staffed by three hourly
employees and two managers, is responsible for interviewing applicants and deciding whom to hire. An
employee committee performs both short – and long – term planning of labor, materials, equipment,
production runs, packing, and delivery. Employees even meet daily in order to set their own production
schedules. “We empower employees to make decisions, not just have input,” Frey remarked. “I just
coach.”
Under Frey’s new management regime, company secrets have virtually disappeared. All Cin-
Made employees, from entry-level employees all the way to the top, take part in running the company. In
fact, Frey has delegated so much of the company’s operations to its workers that he now feels little in the
dark. “I now know very little about what’s going on, on a day-to-day basis,” he confessed.
At Cin-Made, empowerment and delegation are more than mere buzzwords; they are the way of
doing business – good business. “We, as workers, have a lot of opportunities,” said Williams. “If we want
to take leadership, it’s offered to us.”
Question & Answers:
Q 1. How were principles of delegation and decentralization incorporated into Cine – Made operations?
Q 2. What are the sources and uses of power at Cin – Made?
Q 3. What were some of the barriers to delegation and empowerment at Cin –Made?
Case – 2
Culture Shock
Warren Oats was a highly successful executive for American Auto Suppliers, a Chicago-based company
that makes original-equipment specialty parts for Ford, GM, and Chrysler. Rather than retreat before the
onslaught of Japanese automakers, AAS decided to counterattack and use its reputation for quality and
dependability to win over customers in Japan. Oats had started in the company as an engineer and
worked his way up to become one of a handful of senior managers who had a shot at the next open vicepresidential
position. He knew he needed to distinguish himself somehow, so when he was given a chance
to lead the AAS attack on the Japanese market, he jumped at it.
Oats knew he did not have time to learn Japanese, but he had heard that many Japanese executives
speak English, and the company would hire a translator anyway. The toughest part about leaving the
United States was persuading his wife, Carol, to take an eighteen-month leave from her career as an
attorney with a prestigious Chicago law firm. Carol finally persuaded herself that she did not want to miss
an opportunity to learn a new culture. So, armed with all the information they could gather about Japan
from their local library, the Oats headed for Tokyo.
Known as an energetic, aggressive salesperson back home, Warren Oats wasted little time getting started.
As soon as his office had a telephone—and well before all his files had arrived from the States—Oats made
an appointment to meet with executives of one of Japan’s leading automakers. Oats reasoned that if he
was going to overcome the famous Japanese resistance to foreign companies, he should get started as
soon as possible.
Oats felt very uncomfortable at that first meeting. He got the feeling that the Japanese executives were
waiting for something. It seemed that everyone but Oats was in slow motion. The Japanese did not speak
English well and appeared grateful for the presence of the interpreter, but even the interpreter seemed to
take her time in translating each phrase. Frustrated by this seeming lethargy and beginning to doubt the
much-touted Japanese efficiency, Oats got right to the point. He made an oral presentation of his
proposal, waiting patiently for the translation of each sentence. Then he handed the leader of the
Japanese delegation a packet containing the specifics of his proposal, got up, and left. The translator
trailed behind him as if wanting to drag out the process even further.
By the end of their first week, both Oats and his wife were frustrated. Oats’s office phone had not rung
once, which did not make him optimistic about his meeting with another top company the following week.
Carol could scarcely contain her irritation with what she had perceived of the Japanese way of life. She
had been sure that a well-respected U.S. lawyer would have little trouble securing a job with a Japanese
multinational corporation, but the executives she had met with seemed insulted that she was asking them
for a job. And the way they treated their secretaries! After only a week in Japan, both Carol and Warren
Oats were ready to go home.
A month later, their perspective had changed radically, and both looked back on those first meetings with
embarrassment. Within that month, they had learned a lot about the Japanese sense of protocol and
attitudes toward women. Warren Oats believed he was beginning to get the knack of doing business with
the Japanese in their manner: establishing a relationship slowly, almost ritualistically, waiting through a
number of meetings before bringing up the real business at hand, and then doing so circumspectly. It was
difficult for Oats to slow his pace, and it made him nervous to be so indirect, but he was beginning to see
some value in the sometimes humbling learning process he was going through. Perhaps, he thought, he
and Carol could become consultants for other executives who needed to learn the lessons he was
beginning to understand.
Case Questions
1. What specific errors did Warren and Carol Oats make during their first week in Japan?
2. If you were talking to a non-U.S. businessperson making a first contact with an American
company, what advice would you give?
CASE 3 :
COKE’S EUROPEAN SCARE
What seemed like an isolated incident of a few bad cans of Coca-cola at a school in Belgium turned into
near disaster for the soft drink giant’s European operations. In June 1999, Coke experienced its worst
nightmare-acontamination scare resulting in the recall of 14 million cases of Coke products in five European
countries and a huge blow to consumer confidence in the quality and safety of the world’s most recognizable
brand.
After the initial scare in Bornem, Belgium, Coke and Coca-Cola Enterprises (CCE), a bottler 40 per
cent owned by Coca-Cola, thought they had isolated the problem. Scientists at the CCE bottling plant in
Antwerp found that lapses in quality control had led to contaminated carbon dioxide that were used in the
bottling of a recent batch of Coke. Company officials saw the contamination as minor problem and they
issued an apology to the school.
At the same time that the problems were being dealt with in Antwerp, things were breaking down at
Coke’s Dunkirk, France, bottling plant. In Belsele,10 miles from Bornem. Children and teachers were
complaining of illnesses related to drinking Coke products. The vending machines at the school were
stocked with Coke from the company’s Dunkirk plant and were thought to be safe. Now a second bottling
plant’s practices were being questioned. What initially seemed like an isolated incident was now a crisis.
On June, 15,1999. 11 days after the initial scare in Bornem, Coke finally issued an explanation to the
public. Most Europeans were not satisfied, Coca-cola officials used vague language and often contradicted
one another when making statements. France’s health minister, Bernard Kouchner, stated “That a
company so very expert in advertising and marketing should be so poor in communicating on this matter
is astonishing”.
After three weeks of testing by both Coke officials and French government scientists, it was concluded
that the plants were safe and that their was no immediate threat to the health of concluded that the
plants were safe and that there was no immediate threat to the health of consumers. Coke has destroyed
all of the pallets in Dunkirk and tightened quality control on CO2.
How could this happen to the company that is revered worldwide for its quality control and the
European market now represents 73 per cent of total profits.14 While the scare has had some effect on
Coke’s profits in Europe, the company is more concerned with damages to its reputation and consumer
confidence in its products.
Many critics say that Coke’s slow response time, insisting that no real problem existed and belated
apology have severely damaged the company’s reputation in Europe. Some would disagree and feel that
Coke handled the situation as best it could. “I think that Coke acted in a responsible, diligent way,” says
John Sitcher, editor of Beverage Digest. “Their first responsibility was to ascertain the facts in a clear and
unequivocal way. And as soon as Coke knew what the facts were, they put out a statement to the Belgium
people.”
The character and quality of a company can often be measured by how it responds to adversity. Coca-
Cola believes that this crisis has forced the company to re-examine both its marketing and management
strategies in Europe. Coke executives in Brussels are predicting that the company will double its European
sales in the next decade and that this setback will only make the company stronger. Wall Street analysts
seem to agree. Only time will tell.
Questions:-
1. What are the management issues in this case
2. What did Coke do and what could have been done differently?
3. What are the key factors that were or should have been considered by management?
Section B
Q .1: Think back to the executive who recognized employees with motivational stickers, such as
“Dynamite.” What impact might such a sticker have on your job performance and satisfaction?
Q. 2: How might understanding the steps in the communication process help managers and staff
professionals do a better job?
Q. 3: In what way is participating on a spots team, in a musical band, or in an orchestra good
participation for being a member of a work group on the job?
Q. 4: Why don’t managers who are great controllers generally receive as much publicity as managers who
are great leaders?


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International Human Resource Management (Spz.)

_____________________________________________________________________________
1. Discuss the components of Multinational Compensation System. What factors should be kept in
mind while designing a compensation system?
2. Ethics and the question of social responsibility are complex and the source of much controversy”
Discuss the statement.
3. How does appraising an expatriate’s performance differ from appraising that
of a home office manager?
4. (a) What is the role of women managers in our global economy?
(b) How compensation is a motivational factor.
5. What is expatriate re-entry? What are the factors behind failure of expatriates? What are the needs
of expatriates?
6. Define performance appraisal. Suggest criteria for performance appraisal of subsidiary staff.
7. Describe Kluckhohn and Strodtbeck’s value orientation model. What are its applications in
managing business organizations?
8. Highlight the difficulties encountered in International Human Resource Planning. Elaborate the
international Human Resource Planning Process.

COURSE: EMBA (Sem-II)
SUBJECT: International Business
N.B: 1} Attempt all the questions

_____________________________________________________________________________
Case Study 1 – Documentary Credit (Marks -16)
M/S Auto India
Introduction
M/S Auto India is a public limited company; they manufacture SUVs (sports utility Vehicle), in technical
collaboration with General Motors of USA. The company has established their manufacturing base at
Ranjangaon in Pune. They have acquired an area of 250 acres and the total project cost is estimated at
Rs 1500 crores. As per the projections, the company is slated to achieve a 25% market share in the
Indian market, within a period of two years.
Out of the total project cost, 49% is brought in by General Motors and the rest is tied up with financial
institutions, international banks and Indian banks. The working capital is financed by a consortium of
banks in which Global bank, Pune branch, is the leader. The company imports many parts of the car
engine in a CKD (completely knocked down) condition from General Motors, Detroit, after establishing
import letters of credit through its main bankers, Global Bank, Pune Branch.
M/S Auto India approached Global Bank, Pune for opening of import letter of credit as per UCP ICC 600
for USD 100,000, on sight basis, in favour of General Motors, Detroit.
Type of credit – Irrevocable negotiable
Application – UCP ICC 600
Applicant – M/S Auto India, Pune, India
Beneficiary – M/S General Motors, Detroit, USA.
Issuing Bank – Global Bank, Pune, India
Advising Bank – The American Bank, New York
Negotiating Bank – The American Bank, New York
Reimbursing Bank – International Bank, New York
Availability – Negotiable at sight
Expiry – At the counters of The American Bank, New York
Amount – USD 100,000
Merchandise – Car engine parts
Quantity and price – 50 units @ USD 2000 per unit
Circumstances
Issuing Bank
Global Bank, Pune issued its irrevocable negotiable credit through its head office in Pune
since Global Bank co-ordinated all its accounting and communication functions at its head office. The
Bank’s head office transmitted the credit through Swift network as
instructed by its Pune branch to General Motors, Detroit, through The American Bank, New
York.
Advising Bank
The American Bank, New York advised the credit to General Motors, Detroit on receipt
of the swift transmission.
Credit
Along with other conditions, the credit clearly stated that the negotiating bank was to
forward the documents directly to Global Bank’s head office at Pune.
Beneficiary
After export of the consignment, General Motors, Detroit presented the documents under
the credit to The American bank, New York.
Negotiating Bank
The American Bank, New York, examined the documents presented by General Motors
and determined that they were in compliance with the terms and conditions of the credit. The
American bank negotiated the documents and forwarded the documents, as per the credit
terms, to the HO of Global Bank in Pune and claimed reimbursement from International
bank, New York.
Reimbursing Bank
International Bank, New York honoured the reimbursement claim by crediting the current
account of the American Bank, New York and debiting the account of Global Bank, Pune, in its
books.
Issuing Bank Head Office
Global Bank’s Head Office, at Pune, received the documents and after internal
registration of the documents, forwarded the documents to its Pune Branch by inter-office
mail.
Issuing Bank Branch
On receipt of the documents by the Pune branch of Global Bank, they examined the
documents and determined that they were discrepant. They were (a) 60 units were
shipped instead of 50 units, thereby overdrawing the credit value by USD 2000 (b)
Inspection certificate by Auto Inspection Council, USA is not submitted, as per credit
terms. Global Bank contacted Auto India for waiver of the discrepancies.
Applicant
Auto India requested for copies of the documents to be forwarded by fax and after
reviewing the same, they refused to waive the discrepancies.
Issuing Bank Branch
Global Bank, Pune Branch instructed its HO to transmit an authenticated swift to The
American Bank, New York stating that Global Bank had rejected the documents for the noted
discrepancies, requesting the American Bank’s instructions as to disposal of the documents,
and demanding a refund of the funds reimbursed.
Issuing Bank Head Office
The HO of the Global Bank sent the authenticated swift message to the American Bank,
New York, as instructed by its Pune Branch.
Negotiating Bank
On receipt of the swift notification advising that Global Bank had rejected the documents
for the stated discrepancies, the American Bank informed Global Bank that it did not accept
the rejection of the drawing since the Global Bank did not comply with UCP 600 sub-article 14
for standard examination of documents. Therefore, Global Bank was said to be stopped from
dishonouring its irrevocable obligation.
Issuing Bank
Global Bank, Pune Branch responded by stating that they acted in accordance with UCP
article 14, since their action did not exceed five banking days following the day of receipt of the
documents at their branch counters after which they scrutinised the documents and
determined to refuse them. They maintained that as per article 14 of UCP 600, they notified
about the rejection of the documents, by swift, not later than the close of the fifth banking day
following the day of receipt of the documents. They had pointed out all the discrepancies and
had informed American Bank, New York that they were holding the documents at the latter’s
disposal.
Negotiating Bank
The American Bank, New York replied as follows:-
We disagree with your position that you acted in accordance with UCP 600 article 14.
Documents were delivered by courier to your HO as per the terms of the credit, on Monday,
January 7, 2008. Your swift notifying rejection of the documents was not sent until
Wednesday, Jan 16, 2008 that is, on the eighth banking day after receipt of the documents
by your bank.
Issuing Bank
Global Bank, Pune Branch, responded by stating that even though its HO received the
documents on January 7,2008; the Global Bank’s Pune Branch did not receive the documents
until the following Thursday, January 10, 2008, and the swift advice rejecting the documents
was sent within the time period permitted in UCP article 14.
Negotiating Bank
The American Bank, New York, replied that it was not their concern how Global Bank’s
operational policy impacted on their inability to comply with UCP. The American Bank, New
York stated that in accordance with the credit terms and conditions, documents were
negotiated by them and forwarded to Global Bank’s HO by courier. The documents were
received by Global Bank on Jan 7, 2008, and any notice of rejection of the documents should have been
given within the close of the fifth banking day following receipt of the documents. Global Bank’s Pune
Branch failed to do so. Therefore, the American Bank, New York’s position was firm relative to UCP 600
article 14 and they would not refund the funds reimbursed.
Questions
1) Was Global Bank, Pune Branch correct in its argument, as the credit issuing bank?
2) Was the stand taken by The American Bank, New York correct, as the negotiating bank?
***
Case Study 2 – (Marks -16)
Foreign Trade
M/S Taneja Exports, Mumbai
Introduction
Mr. Gurmeet Taneja and Mr. Rahul Khatri are partners of M/S Taneja exports, Mumbai.
Both of them qualified from IIFT, New Delhi in the year 2002. They declined lucrative
corporate job offers, since they have decided to plunge into the world of international
business.
M/S Taneja Exports is registered as a partnership firm, with Mr. Gurmeet Taneja and Mr. Rahul
Khatri sharing the profits in the ratio of 60: 40.
The partners had conducted in depth market survey in the domestic as well as
international markets regarding the demand of women’s apparels in cotton and hosiery. They
have taken the assistance of Apparel export promotion council and the marketing agencies in
various countries of European Union.
On account of their knowledge in foreign trade, they were able to quickly assess that Indian
exporters have not succeeded in penetrating into the huge apparel market of Europe.
They found out that the main reasons were ineffective marketing, improper quality control and
non adherence to the shipping schedules. Mr. Gurmeet concentrated on marketing of the
cotton and hosiery apparels abroad and Mr. Rahul ensured on the procurement of the raw
materials and timely execution of shipments.
The firm had taken an industrial gala, measuring 700 sq ft, at 501, Mangal Das market, Lower
Parel, Mumbai. They were paying a monthly rent of Rs. 35,000/- for the office premises and
the stock of garments was kept in a godown in the same gala area, for which the rent
payable was Rs. 15,000/- pm
The firm was sourcing their raw materials from the south Indian towns of Tirupur and
Coimbatore. As per the export orders, they were providing the raw materials for job works
in Mumbai and subject the samples to rigorous quality and specification checks. The firm had
employed 2 accounts staff and 3 contract workers to attend to daily office and godown
activities.
The firm was able to achieve steady improvement in export sales due to the stringent quality
control measures and timely execution of shipment schedules. The following were the credit
facilities enjoyed from M/S International Bank of India, Fort branch, Mumbai.
Facility (Amount in Lakhs) 2003 2004 2005
Fund based
a) Export packing credit 5.00 7.00 10.00
b) Foreign bill purchased/Foreign
bill negotiated
5.00 7.00 10.00
Non Fund based
a) Performance guarantee 2.00 5.00 7.00
Export sales 20.00 30.00 40.00
Towards the security of the credit facilities, the firm had mortgaged the residential house,
valued at Rs 85 lakhs, belonging to Mr. Vikram Taneja, father of Mr. Gurmeet Taneja, and
stocks valued at Rs 15 lakhs was also hypothecated to the Bank. Mr. Vikram Taneja stood
guarantee for the facilities sanctioned to the firm.
M/S Taneja exports used to avail the export packing credit facility from International Bank of
India and adjust the same by purchase or negotiation of the export bills drawn on their
European buyers. Generally the bills carried a tenor period of 60 days. Most of the export bills
were drawn and send for collection through international Bank of India, Mumbai Fort Branch,
to the foreign buyer’s bankers, based on the confirmed purchase order of the buyer. The bills
were paid on the due dates and the conduct of the account on the bank’s books was quite
satisfactory. Based on the past history and the increase in
sales turnover achieved by the firm, the bankers were happy to increase the credit limits
from Rs 7 lakhs in 2003 to Rs 17 lakhs in 2005.
On June 17, 2005, the firm submitted an export document to International Bank of India, Fort
Branch, for Euro 53000.00, drawn on M/S St Laurn Fashions, Paris. The documents were
drawn on 60 days DA terms as per the contract. The merchandise under the export were ladies
garments in cotton and hosiery. In the covering letter of the firm to the bank, they had
instructed the bank to present the documents to St Laurn, Paris, through their bankers viz,
Credit Lyonnais, Paris. The exporter had submitted bills of exchange, bills of lading, commercial
invoice, packing list, inspection certificate, certificate of origin and in the bill of exchange it was
typed as ‘to be co-accepted by credit Lyonnais’.
The International Bank of India took the documents in its books and sent the documents for
collection to Credit Lyonnais, Paris. In due course, they received communication from Credit
Lyonnais that the documents were accepted by St Laurn and due date of the
documents were August 25, 2005.The bankers informed the due date of the bill to Taneja
exports. On August 30, 2005, Taneja Exports informed the bankers that they are yet to receive
the payment of the bill for Euro 53000.00 in their books. The bank sent a swift message
enquiring about the fate and payment of the bill. Two days later the bank received a message
from Credit Lyonnais saying that the importer, St Laurn, had become bankrupt and they were
unable to pay the bill. International Bank of India informed the same to Taneja Exports. They
argued with the bank that they had clearly mentioned in the bills of exchange that the
documents were to be released against the co-acceptance of the
French bank only. Immediately the Indian bank send a message to Credit Lyonnais that
since the bill of exchange contained the co-acceptance clause by the French bank, they
are liable to pay even though the importer had become bankrupt. The French bank refuted the
claim of the Indian Bank and intimated that the bank’s collection instruction did not contain
any co-acceptance clause by the French bank and they had acted as per the provisions in the
uniform rules for collection in the ICC publication No 522.
Since payments were not forthcoming, Taneja Exports filed a suit with the National Consumer
Forum, New Delhi for deficiency of services by International Bank of India, Mumbai, on
November 10, 2005. They put forth the argument that the bank was deficient in not
mentioning about the co-acceptance clause in their covering letter to the French bank and in
case of non-coacceptance by the French bank they would have returned the documents to
India and the exporter could have arranged for an alternate buyer or re- import of the
merchandise. This negligence on the part of the bank had caused them total financial loss.
After hearing the arguments of both the parties, The National Consumer Forum gave the
judgement, on February 6, 2006, that the International Bank of India was deficient and
negligent in their services and ordered them to compensate the value of the export bill of Euro
53000.00 (approx Rs 24 lakhs) along with 15% interest, till the date of payment.
The bank went on appeal against the order of the consumer forum in the Supreme Court on
March 20, 2006. After hearing the counsels of both sides, the Supreme Court gave the
judgement that since the original agreement between the exporter and importer do not have
any co-acceptance clause by the importer’s banker, the co-acceptance clause on the bill of
exchange cannot be binding on the French Bank as well as on the Indian Bank.
The bankruptcy of the importer is the reason for loss to the exporter and not the deficiency of
service by the bank. The Supreme Court set aside the judgement of the National consumer
forum and passed the judgement in favour of the bank, with costs, on March 15, 2007.
Questions
1) Elaborate the deficiency of service on the part of the bank, pointed out by the National
consumer redressal forum, in the light of the uniform rules for collection ICC publication
No.522.
2) Advise the firm about the precautions they should have taken to avoid such a colossal
business loss.
3) Discuss the remedial measures the bank in India should take to avoid such damaging
judgements by the consumer forums.
4) Elaborate the Supreme Court judgement in the context of the international banking
rules and practises, as guided by the ICC publications.
Case-3 (Marks -16)
LATE MOVER ADVANTAGE?
Though a late entrant, Toyota is planning to conquer the Indian car market. The Japanese auto major
wants to dispel the notion that the first mover enjoys an edge over the rivals who arrive late into a
market.
Toyota entered the Indian market through the joint venture route, the partner being the Bangalore based
Kirloskar Electric Co. Known as Toyota Kirloskar Motor (TKM), and the plant was set up in 1998 at Bidadi
near Bangalore.
To start with, TKM released its maiden offer— Qualis. Qualis is not a newly conceived, designed, and
brought out vehicle. Rather it is the new avatar of Kijang under which brand the vehicle was sold in
markets like Indonesia.
Qualis virtually had no competition. Telco’s Sumo was not a multi-utility vehicle like Qualis. Rather, it was
a mini-truck converted into a rugged all-purpose van. More importantly, Toyota proved that even its old
offering, but decked up for India, could offer better quality than its competitor. Backed by a carefully
thought out advertising campaign that communicated Toyota’s formidable global reputation, Qualis went
on a roll and overtook Tata Sumo within two years of launch.
Sumo sold 25,706 vehicles during 2000—2001, compared to a 3 per cent growth over the previous year,
compared to 25,373 of Qualis. But during 2001—2002, it was a different story. Qualis had been clocking
more than 40 per cent share of the market. At the end of Sept 2001, Qualis had sold over 25,000 units,
compared to Sumo’s 18000 plus.
The heady initial success has made TKM think of the future with robust confidence. By 2010, TKM wants to
make and sell one million vehicles per year and garner one-third share of the Indian market. The firm is
planning to introduce a wide range of vehicles—a sub-compact, a sedan, a luxury car and a new multiutility
vehicle to replace Qualis. A significant percentage of the vehicles will be exported.
But Toyota is not as lucky in China. Its strategy of ‘late entry’ in China seems to have back fired. In 2005,
it sold just 1, 83, 000 cars in China, the fastest growing auto market in the world. Toyota ranks ninth in
the market, far behind Volkswagen, General Motors, Hyundai and Honda. Toyota delayed producing cars
in China until 2002, when it entered a joint venture with a local company, the First Auto Works Group
(FAW). The first car manufactured by Toyota FAW, the Vios, failed to attract much of a market, as, despite
its unremarkable design, it was three times as expensive as most cars sold in China.
Late start was not the only problem. There were other lapses too. Toyota assumed the Chinese market
would be similar to the Japanese market. But Chinese market, in reality, resembled the American market.
Sales personnel in Japan are paid salaries. They succeeded in building a loyal clientele for Toyota by
providing first-class service to them. Likewise, most Japanese auto dealers sell a single brand, thereby
ensuring their loyalty to it. Japan is a relatively a well-knit country with an ethnically homogeneous
population. Accordingly, Toyota used nationwide advertising to market its products in its home country.
But China is different. Sales people are paid commissions and most dealers sell multiple brands.
Obviously, loyalty plays little role in motivating either the sales staff or the dealers, who will ignore a slow
selling product should a more profitable one turn up. Besides, China is a large, diverse country. A
standardized ad campaign will not do. Luckily, Toyota is learning its lessons. Competition in the Chinese
market is tough, and Toyota’s success in reaching its goal of selling a million cars a year, by 2010, is
uncertain. But, its chances are brighter as the company is able to transfer lessons learned in the American
market to its operations in China.
Questions:-
1. Why has the late corner’s strategy’ of Toyota failed in China, though it succeeded in India?
2. Why has Toyota failed to capture the Chinese market? Why is it trailing behind its rivals?
Case – 4 (Marks -16)
THE EU’S LAGGING COMPETITIVENESS
In a report produced for the European Commission, published in November 1998, it was argued that the
EU lags behind the USA and Japan on most measures of international competitiveness. Gross domestic
product per capita, sometimes used as an indicator of international competitiveness at the country level,
was 33 per cent lower in the EU as a whole than in the USA and 13 per cent lower than in Japan. The EU’s
poor record in creating employment was singled out for particular criticism. As this appeared to apply
across 2. the board in most industrial sectors, it suggested that the EU’s poor performance related to the
business environment in general and, in particular, to the flexibility of Europe’s labor markets and
excessive regulation in markets for goods and 3. Services. A shortage of risk capital for advanced
technological development and high cost and 4. Inefficiency of Europe’s financial services was also
highlighted by the report. For one reason or another, European industries generally lag behind in
technology industries. If measured by the number 5. of inventions patented in at least two countries, the
USA is well ahead of most European countries, as well as Japan. Despite these shortcomings, the report’s
authors focus attention on flexible markets, market liberalization, and the creation of a competitive
business environment rather than on targeted intervention by the EU or national authorities.
Questions:-
1) Is gross domestic product per capita a useful indicator of international competitiveness in the EU?
2) Is it fair to point the blame for the EU’s poor international competitiveness at inflexible labor markets,
regulated goods and services markets, and a general lack of competition? What alternative explanations
might be suggested? What appears to be the problem with the EU’s banking sector?
3) Is the number of patents registered a useful indicator of superior international competitiveness? Why
do you think the USA does well in this area?
4) Should the EU consider more targeted intervention in the form of subsidies or strategic trade policy?
Case-5 (Marks-16)
AT THE RECEIVING END
Spread over 121 countries with 30,000 restaurants, and serving 46 million customers each day with the
help of more than 400,000 employees, the reach of McDonald’s is amazing. It all started in 1948 when
two brothers, Richard and Maurice ‘Mac’ McDonald, built several hamburger stands, with golden arches in
southern California. One day a travelling salesman, Ray Kroc, came to sell milkshake mixers. The
popularity of their $0.15 hamburgers impressed him, so he bought the world franchise rights from them
and spread the golden arches around the globe.
McDonald’s depends on its overseas restaurants for revenue. In fact, 60 per cent of its revenues are
generated outside of the United States. The key to the company’s success is its ability to standardize the
formula of quality, service, cleanliness and value, and apply it everywhere.
The company, well known for its golden arches, is not the world’s largest company. Its system wide sales
are only about one-fifth of Exxon Mobil or Wal-Mart stores. However, it owns one of the world’s best
known brands, and the golden arches are familiar to more people than the Christian cross. This
prominence, and its conquest of global markets, makes the company a focal point for inquiry and
criticism.
McDonald’s is a frequent target of criticism by anti-globalization protesters. In France, a pipes moking
sheep farmer named Jose Bove shot to fame by leading a campaign against the fast-food chain.
McDonald’s is a symbol of American trade hegemony and economic globalization. Jose Bove organized
fellow sheep farmers in France, and the group led by him drove tractors to the construction site of a new
McDonald’s restaurant and ransacked it. Bove was jailed for 20 days, and almost overnight an
international anti-globalization star was borne. Bove, who resembles the irrelevant French comic book
hero Asterix, travelled to Seattle in 1999, as part of the French delegation to lead the protest against
commercialization of food crops promoted by the WTO. Food, according to him, is too vital a part of life to
be trusted to the vagaries of the world trade. In Seattle, he led a demonstration in which some skimasked
protestors trashed at McDonald’s. As Bove explained, his movement was for small farmers against
industrial farming, brought about by globalization. For them, McDonald’s was a symbol of globalization
implying the standardization of food through industrial farming. If this was allowed to go on, he said,
there would no longer be need for farmers. “For us,” he declared, “McDonald’s is a symbol of what WTO
and the big companies want to do with the world.” lroncally, for all of Bove’s fulminations against
McDonald’s, the fast food chain counts its French operations among its most profitable in 121 countries.
As employer of about 35,000 workers, in 2006, McDonald’s was also one of France’s biggest foreign
employers.
Bove’s and his followers are not the only critics of McDonald’s. Leftists, anarchists, nationalists, farmers,
labor unions, environmentalists, consumer advocates, protectors of animal rights, religious orders and
intellectuals are equally critical of the fast food chain. For these and others, McDonald’s represents an evil
America. Within hours after US bombers began to pound Afghanistan in 2001, angry Pakistanis damaged
McDonald’s restaurants in Islamabad and an Indonesian mob burned an American flag.
McDonald’s entered India in the late 1990s. On its entry, the company encountered a unique situation.
Majority of the Indians did not eat beef but the company’s preparations contained cow’s meat. Nor could
the company use pork as Muslims were against eating it. This left chicken and mutton. McDonald’s came
out with ‘Maharaja Mac’, which is made from mutton and ‘McAloo Tikki Burger’ with chicken potato as the
main input. Food items were segregated into vegetarian and non-vegetarian categories.
Though it worked for sometime, this arrangement did not last long. In 2001, three Indian businessmen
settled in Seattle sued McDonald’s for fraudulently concealing the existence of beef in its French fries. The
company admitted its guilt of mixing miniscule quantity of beef extract in the oil. The company settled the
suit for $10 million and tendered an apology too. Further, the company pledged to label the ingredients of
its food items, and to find a substitute for the beef extract used in its oil.
McDonald’s succeeded in spreading American culture in the East Asian countries. In Hong Kong and
Taiwan, the company’s clean restrooms and kitchens set a new standard that elevated expectations
throughout those countries. In Hong Kong, children’s birthdays had traditionally gone unrecognized, but
McDonald’s introduced the practice of birthday parties in its restaurants, and now such parties have
become popular among the public. A journalist set forth a ‘Golden Arches Theory of Conflict Prevention’
based on the notion that countries with McDonald’s restaurants do not go to war with each other. A British
magazine, The Economist, prints an yearly ‘Big Mac Index’ that uses the price of a Big Mac in different
foreign currencies to assess exchange rate distortions.
Questions:-
1. What lessons can other MNCs learn from the experience of McDonald’s?
2. Aware of the food habits of Indians, why did McDonald’s err in mixing beef extract in the oil used for
fries?
3. How far has McDonald’s succeeded in strategizing and meeting local cultures and needs?

SUBJECT: Managerial Economics
N.B: 1} Attempt all the questions
_________________
Case 1: Where is the Fair Play? (Marks-16)
In most countries in Europe, and primarily America, they don’t prefer the leg meat – it is waste matter
for them so they look for nations where they can dump this meat. They did in the Philippines, Sri Lanka
and Russia. They might deny it in the US but everybody knows that they are sitting on stocks for at
least 2-3 years. They have succeeded in doing that because of their good freezing techniques. Now it’s
becoming a major problem for them. They’re not used to eating leg meat and are in a fix. In the US
they actually load the price of the entire chicken on the breast meat, and the rest of the bird is like a
carcass to them. Due to environmental reasons they can’t dump it in the sea so they have to dump it
somewhere. It can be any underdeveloped country, may be India!
It’s wrong notion that supply of this meat to underdeveloped countries will be good for the consumers
there. It is not. Can the Americans guarantee anything – how long will they be able to supply the
chicken? How long will they supply subsidized eggs to such a large country? We could end up destroying
our industry base and that will be very sad. As far as chicken is concerned, they can only supply the
legs – they can never supply the whole bird. The white meat costs US $3 to 3.5 per pound, so it’s out of
range. May be the consumer gets the advantage of subsidized supply of the white meat in the short run
but over time the consumers’ interests are likely to suffer because such a supply will result only in
destroying the chicken and egg industry in India. Once their surplus stock gets exhausted they can
charge you any price – can they guarantee the price? They can’t and they won’t.
The chicken/egg business deals with livestock. It is not possible for people to stop producing for a year
and come back – they will be finished. Once they are out of the cycle they are out of the industry. It
would be very said if that happened to this industry that has grown over the past 25 years.
For many people it provides a day-to-day livelihood. Once the foreign players come in and are allowed
to sell their products at very low rates, the industry could collapse as it has in other countries.
India is a the cheapest egg producer in the world – about Re.1 a piece. But now we are very worried. In
European countries, eggs cost between Rs.3-5 but they are able to deliver the same egg to the Middle
East at Re 1-1.50. This is because in Western countries they have so many subsidies. When it comes to
agriculture, they are very sensitive and protective. If they bring it to the Middle East, then why can’t
they do it here as well? The government knows that the Western countries are not going to remove
subsidies – they know when it comes to agriculture, neither the Europeans nor the Americans are going
to do anything. They are going to protect them forever- so where is the fair play?
Questions:
i. What would you recommend to the government to create a level playing field for the local firms
and the western exporters of meat to India?
ii. Can you cite any other typical product where India’s advantage turns into disadvantages as a
result of WTO agreement?
Case: 2 (Marks -16)
One of the most notable things about consumer behaviour is that the demand in the short run is always
less elastic (or more inelastic) than the demand in the medium or long term. Petroleum, which is one of
the most essential commodities of modern life is a classic example of this phenomenon. Petroleum, also
known as a luxurious necessity because of its steep price, is the greatest cause for our Balance of
Payment being perennially in deficit. Despite all its disadvantages, life is literally and figuratively
`immobile’ without petroleum.
Our country faced two oil shocks during the 1970s. The shock of 1973-74 was a severe one and was felt
by many other countries, while the oil shock of 1979 was mild and pertained only to India. In order to
combat the sudden fall in supply, resulting in excess demand for it, the price of petrol was hiked (in
India, petroleum prices are always administered, and not market-driven) assuming that consumer
demand for petrol will go down. There was some reduction in the consumption of petrol as people
limited their pleasure trips and joy rides. The concept of `car pool’ to go to offices started and the
middle class started depending heavily on diesel-run public transport (diesel although a by-product of
crude oil is a cheaper and readily available product).
Besides this, there was no perceptible change in the demand for petrol and people continued to buy
petrol at a higher price. As a result, although the prices went up by 25 to 30 percent, the demand
decreased by only 5 to 6 percent between the 1970s and the early 1980s.
However, analysts and planners observed phenomenon, believed to be related to the hike in the price of
petrol. People, especially in the urban areas, started to stay near the workplace (even if it meant a
higher rent), showing a preference for fuel-efficient vehicles when compared to steady, stable but not
such fuel-efficient vehicles.
The phenomenal success of Maruti 800 cars launched in the mid-1980s was because of its single
attribute of fuel-efficiency, despite other disadvantages of a light body (which made it easy for the car to
topple over and get dented or damaged on Indian roads), costly parts (when compared to the
Ambassador or Fiat). Consumes preferred Maruti for its excellent fuel-efficient technology and hence a
lower running cost, than for any other reason. So much was the popularity of Maruti cars that
automobile associations discovered that the demand for other vehicles had falled by 30 to 40 percent in
favour of Maruti 800. a permanent change in the demand pattern for small, fuel-efficient cars had been
achieved.
For most commodities, economists found that in the long term (the concept of long term varies from
commodity to commodity) the absolute value of the demand elasticity is higher than in the short run. A
few of these are given in the following Table:
The value of demand elasticity for certain goods and services in India
(This includes urban, semi-urban and small town area)
Goods + Services Short-Run
Demand Elasticity
Long-Run
Demand
Elasticity
Expenditure on food 0.35 0.36
Expenditure on clothing 0.68 1.22
Consumption of electricity 0.54 0.90
House rent 0.75 1.82
Transportation 0.40 1.60
Source: Calculated on the basis of Government of India published reports.
Questions:
i Why do you think the absolute value of demand elasticity is less in the short run than in the long
run?
ii. Do you think jewellery as a commodity, can also be categorized in the same group as others in
the given table? In other words, will it also exhibit change in the demand elasticity between the
short and long run? Explain why?
iii. The change in the value of demand elasticity between short and long run is much smaller in case
of food than in clothing, what does this reflect about the consumer behaviour?
Case :3 (Marks -16)
TAKE THE BULL BY THE HORN
Through its relatively brief history, the Reliance group has specialised in taking gambles, sometimes
huge ones. A pattern repeated time and again – such as when it set up capacities for Polyester Staple
Fibre (PSF) which was the same size as the domestic market or when it put up a 27 million tonne
refinery in Jamnagar, which is close to a third of India’s demand for petroleum products.
There’s no gamble quite so audacious as the one that’s underway. The Rs. 25,000 crore Reliance
Infocom project that’s currently taking shape aims at no less than a complete remake of India’s telecom
landscape to emerge as India’s number one telecommunications company, ahead of the state-owned
behemoth Bharat Sanchar Nigam l td.
It’s also an attempt to realign Reliance’s revenues and profits – which today originate entirely from
manufacturing – with India’s economic profile, in which services account for over 40 per cent of GDP.
“Reliance’s revenues will have to become diversified with a larger proportion originating from services
which would be in keeping with the
changing structure of India’s economy,” says Mukesh Ambani, vice chairman of Reliance Industries.
Rs. 8000 crore will be invested over a three – year period. As of now, it’s full steam ahead for Reliance’s
Infocom plans. As it had done earlier in oil and gas. Reliance plans to emerge as an integrated player,
focusing on the entire range of telecom services ranging from high – speed internet access for business
and consumers, call centres,
data centres, cellular phone services and domestic and international long distance telephony. Apart from
the gamut of telecom services, Reliance’s integration plans are in one respect unique in the telecom
industry. If senior group officials are to be believed, the company has plans to assemble cellular phones
and set-top boxes.
At the core of the Infocom project is a 115,000 km fibre optic backbone covering 115 cities across 12
States, accounting for over 50 per of India’s GDP. The company plans to become what the industry
jargon refers to as a carriers’ carrier, where it hires out infrastructure to other telecom operations. Here
Reliance, along with the Bharti group, has obtained a licence for providing domestic long-distance
services. In fact, these are the only two companies to do so. The total domestic long-distance market is
worth Rs. 6,000 crore. Of this, the market available to the long
distance operator is likely to be Rs. 2,400 crore, according to a December 2000 Merrill Lynch report. This
is based on a 30 : 40 : 30 revenue share between the originator, the carrier and the last-mile access
provider. However, Reliance would hope for a larger share since it plans to fill all the three roles. Merrill
Lynch estimates that the domestic long-distance revenues accruing to the carrier would amount to Rs.
2760 crore in 2002 – 03, of which Reliance is expected to garner 20 per cent – or Rs. 620 crore.
As part of its plans to enter international long-distance telecommunication, Reliance has already
submitted an expression of interest for international long-distance operator VSNL. The total international
long-distance market in India right now is Rs. 4,900 crore. Reliance’s own estimates for revenue and
profitability have not been made publicly available. However, internal estimates reportedly project
revenues of Rs. 30,000 crore, which is roughly a third of the total telecommunication market of around
Rs. 1,00,000 crore estimated for fiscal year 2004 – 05. The annual total telecommunications market is
around Rs. 42,000 crore. These estimates are of course based on the assumptions of a rapid take-off in
traffic, particularly data traffic. Check out some figures: out of the 30 million households that have an
income over Rs. 4000, an estimated 20 million are in the urban market and 10 million in the rural
market. Out of the urban people, 13 million already have fixed-line connections. And out of the 10
million rural customers, 6.5 million already have fixed lines.
In the light of the above: “what kind of growth can one really expect” for the telecommunication sector
in India as such and Reliance lnfocom in particular ?
Questions :
(a) Is there such a market in India for all the huge plans that they have ?
(b) Can you support it as a case of economies of scope ?
(c) Does it not lend to monopolistic conditions ? Give reasons.
Case : 4 (Marks-16)
The Industry
The automotive sector is one of the core industries of the Indian economy, whose prospect is reflective
of the economic resilience of the country. The automobile industry witnessed a growth of 19.35 percent
in April-July 2006 when compared to April-July 2005. As per Davos Report 2006, Indian is largest three
wheeler market in the world; 2nd largest two wheeler market; 4th largest tractor market; 5th largest
commercial vehicle market and 11th largest passenger car market in the world and expected to the
seventh largest by 2016. India is among few countries that are showing a growth rate of 30 per cent in
demand for passenger cars. The industry currently accounts for nearly 4% of the GNP and 17% of the
indirect tax revenue. The well developed India automotive industry produces a wide variety of vehicles
including passenger cars, light, medium and heavy commercial vehicles, multi-utility vehicles, scooters,
motorcycles, mopeds, three wheelers, tractors etc. Economic liberalization over the years made India as
one of the prime business destination for many global automotive players, including international giants
like Ford, Toyota, GM and Hyundai have also made their also made their presence with a mark.
As per another report, every commercial vehicle manufacture, create 13.31jobs, while every
passenger car creates 5.31 jobs, and every two-wheeler create 0.49 jobs, in the country. Beside, the
automobile industry has as output multiplier of 2.24, i.e., for every additional rupee of output in the auto
industry, the overall output of the India economy increases by Rs. 2.24.
The India automotive sector has a presence across all vehicle segments and key components. In
terms of volume, two wheelers dominate the sector, with nearly 80 percent share, followed by passenger
vehicles with 13 percent. At present, there are 12 manufactures of passenger cars, 5 manufactures of
multi utility vehicles (MUVs), 9 manufactures of commercial vehicles (CVs), 12 of two wheelers and 4 of
three wheelers, besides 5 manufactures of engines.
Table 1 Vehicle Segment-wise Market Share (2005-06)
Items Percent Share
Commercial Vehicles
Passenger Vehicles
Two Wheelers
Three Wheelers
Total
3.94
12.83
79.19
4.04
100.00
Source: Report of Society of Indian Automobile Manufactures (SIAM), 2006.
Although the automotive industry in India is nearly six decades old, until 1982, there were only three
manufactures – M/s. Hindustan Motors, M/s. Premier Automobiles and M/s. Standard Motors in the
motorcar sector. In 1982, Maruti Udyog Ltd. (MUL) came up as a government initiative in collaboration
with Suzuki of Japan to establish volume production of contemporary models.
The Company
Maruti Udyog Limited (MUL) has become Suzuki Motor Corporation’s R&D hub for Asia outside Japan.
Maruti introduced upgraded versions of the Esteem, Maruti 800 and Omni, completely designed and style
in house. This followed the up gradation of WagonR and Zen models, done in house only a year before.
Maruti engineer also worked with their counterparts in Suzuki Motor Corporation in the design and
development of its new model, Swift.
The company launched superior Bharat Stage III version of most of its models, well before the
Government deadline. Maruti also set up a Center for Excellence with a corpus of Rs. 100 million. This
was done in collaboration with suppliers, who contributed an additional Rs. 50 million. The Center
provides consultancy and training support to Maruti’s Suppliers and Sales Network to enable them to
achieve standards in Quality, Cost, Service and Technology Orientation.
Maruti has embarked upon this new project in collaboration with SMC for the manufacture of diesel
engines, petrol engines and transmission assemblies for four wheeled vehicles. The project is being
implemented in the existing Joint Venture Company viz. Suzuki Metal India Limited (renamed Suzuki
Power train India Limited).
Questions:-
1. Identify the most important factors of production in case of automobile industry. Also attempt to
explain the relative significance of each of these factors.
2. What more information would you like to obtain in order to draw a production function for Maruti
Udyog? Explain with logic.
3. Automobile industry is a good example of capital augmenting technical progress. Discuss.
Case :5 (Marks-16)
By almost any measure, David Galbenski’s company Contract Counsel was a success. It was a company
Galbenski and a law school buddy, Mark Adams, started in 1993; it helps companies find lawyers on a
temporary contact basis. The growth over the past five years has been furious. Revenue went from less
than $200,000 to some $6,5 million at the end of 2003, and the company was placing thousands of
lawyers a year.
And then revenue growth began to flatten; the company grew just 8% in 2004 despite a robust
market for legal services estimated at about $250 billion in the United States alone. Frustrated and
concerned, Galbenski stepped back and began taking a hard look at his business. Could he get it back on
the fast track? “Most business books say that the hardest threshold to cross is that $10 million sales
mark,” he says. “I knew we couldn’t afford to grow only 10% a year. We needed to blow right through
that number.”
For that a happen, Galbenski knew he has to expand his customer base beyond the Midwest into
large legal supermarkets such as Boston, New York, and Washington, D.C. He also knew that in doing so,
he would run into stiff competition from large publicly traded rivals. Contract Counsel’s edge had always
been its low prices. Clients called when dealing with large-scale litigation or complicated merger and
acquisition deals, either of which can require as many 100 lawyers to manage the discovery process and
the piles of documents associated with it. Contract Counsel’s temps cost about $75 an hour, roughly half
of what a law firm would charge, which allowed the company to be competitive despite its relatively
small size. Galbenski was counting on using the same strategy as he expanded into new cities. But would
that be enough to spur the hyper growth that he craved for?
At the time, Galbenski had been reading quite a bit about the growing use of offshore employees.
He knew companies like General Electric, Microsoft and Cisco were saving bundles by setting up call and
data centers in India. Could law firms offshore their work? Galbenski’s mind raced with possibilities. He
imagined tapping into an army of discount-priced legal minds that would mesh with his existing talent
pool in the U.S. The two work forces could collaborate over the Web and be productive on a 24-7 basis.
And the cost saving could be massive.
Using offshore workers was a risk, but the payoff was potentially huge. Incidentally Galbenski and
his eight-person management team were preparing to meet for their semiannual strategic review
meeting. The purpose of the two-day event was to decide the company’s goals for the coming year.
Driving to the meeting, Galbenski struggled to figure out exactly what he was going to say. He was sill
undecided about whether to pursue an incremental and conservation national expansion or take a big
gamble on overseas contractors.
The Decision
The next morning Galbenski kicked off the management meeting. Galbenski laid out the facts as he saw
them. Rather than look at just the next five years of growth, look at the next 20, he said. He cited a
Forrester Research prediction that some 79,000 legal jobs, totaling $5.8 billion in wages, would be dent
offshore by 2015. He challenged his team to be pioneers in creating a new industry, rather than
stragglers racing to catch up. His team applauded. Returning to the office after the meeting, Galbenski
announced the change in strategy to his 20 full-timers.
Then he and his team began plotting a global action plan. The first step was to hire a company
out of Indianapolis, Analysts International, to start compiling a list of the best legal services providers in
countries where people had comparatively strong English skills. The next phase was vetting the
companies in person. In February 2005, just three months after the meeting in Port Huron, Galbenski
found himself jetting off on a three-month trip to scout potential contractors in India, Dubai, and Sri
Lanka. Traveling to cities like Bangalore, Chennai, and Hyderabad, he interviewed executive from more
than a dozen companies, investigating their day-to-say operation firsthand.
India seemed like the best bet. With more than 500 law schools and about 200,000 law students
graduating each year, it had no shortage of attorneys. What amazed Galbenski, however, was that
thanks to the Web, lawyers in India had access to the same research tools and case summaries as any
associate in the U.S. Sure they didn’t speak American English. “But they were also eager to tackle the
kinds of tasks that most new associates at law firms look down upon” such as poring over perfect for the
kind of document-review work he had in mind.
After a retune visit to India in August 2005, Galbenski signed a contract with two legal service
companies: QuisLex, in Hyderabad, and Manthan Services, in Bangalore. Using their lawyers and
Paralegals, Galbenski figured he could cut his document-review rates to $50 an hours. He also
outsourced the maintenance of the database used to store the contact information for his thousands of
contractors. In all, he spent about 12 months and $250,000 readying his newly global company.
Convincing U.S. based clients to take a chance on the new service hasn’t been easy. In November,
Galbenski lined up pilot programs with four clients (none of which are ready to publicise their use of
offshore resources). To help get the word out, he launched a website (offshore-legal-services.com),
which includes a cache of white papers and case studies to serve as a resource guide for companies
interested in outsourcing.
Questions:-
1. As money costs will decrease due to decision to outsource human resource, some real costs and
opportunity cost may surface. What could these be?
2. Elaborate the external and internal economies of scale as occurring to Contract Counsel.
3. Can you see some possibility of economies of scope from the information given in the case?
Discuss.

SUBJECT: Operation Management

Note:- 1) Kindly write case study number question number properly
2) Attached question papers with answer sheets
_____________________________________________________________________________
SECTION A
Case – 1 Marks- 20
Dr. Govinda Venkataswamy (fondly called Dr. V) founded the Aravind Eye Hospitals in 1976 with an 11-
bed facility in Madural, which performed all types of eye surgeries. Its goal was to offer quality care at
reasonable cost. In 1978, a 70 bed free hospital was opened to provide the poor with quality care. In
2004, Aravind Eye Care System comprised Eye Care Facilities at Madural, Theni, Tirunelveli, Coimbatore
and Pondicherry (Exhibit 1) and performed nearly 230,000 eye surgeries and handled 1,640,000
outpatient visits (Exhibit 2). It is recognized as the world’s most productive eye hospital handling the
largest patient volume. Its website states that ‘with less than 1% of the country’s ophthalmic manpower,
Aravind accounts for 5% of the ophthalmic surgeries performed nationwide”. Its mission has now become
to “eradicate needless blindness by providing appropriate, compassionate and quality eye care for all”.
Each day, across all five Aravind Eye Hospitals, about 4481 outpatient visits are handled, about 627
surgeries take place and about three camps are conducted.
Currently, there are more than 20 million blind people in India and only over four million surgeries are
performed every year. Over 75% of the blindness is due to cataract. Cataract is the clouding of the
natural eye lens due to ageing or otherwise. There are two types of cataract surgeries: one in which the
natural lens is removed and then glasses are provided after three to four weeks, called intracapsular
surgery (ICCE) and the other where after removing the natural lens, the intraocular lens inserted, called
extra capsular surgery or ECCE. In ECCE, patients normally do not require corrective lenses after the
surgery. ECCE is better and often preferred because the quality of the restored sight is distortion-free and
near natural. However, ECCE is slightly expensive due to the cost of the intraocular lens. Talking to a
Harvard Business School professor, Dr.V argued, “Tell me, can a cataract surgery be marketed like
hamburgers? Don’t you call it social marketing or something? See, in America, McDonald’s and Dunkin’
Donuts and Pizza Hut have all mastered the art of mass marketing, we have to do something like that to
clear the backlog of Million blind eyes in India. We perform only one million cater acts a year. At this rate
we can’t catch up.” Each of the Aravind Hospitals has two sections: one is the Main Hospital for the paid
patients and other is free hosp ital for nonpaying patients. The series of steps, which a patient normally
goes through, is the same in both the hospitals: patients are initially registered, their vision is recorded
and they undergo a preliminary examination followed by testing of tension and tear duct function. This
follows refraction test and final examination. While the assistants carry out many of the intermediate
steps, a senior ophthalmologist does the final examination. The two sections differ in size, the kind of beds
they provide and general kind of patients. Who come to use them? However, the same pool of doctors and
nurses serves both sections. “The hallmarks of the Aravind model are quality care and productivity at
prices that everyone can afford. A core principle of the Aravind System is that the hospital must provide
services to the rich and poor alike, yet be financially self-supporting. This principle is achieved through
high quality, large volume care and a well-organized system.” In Aravind Hospitals, a typical Operation
Theater (OT) has two tables side by side. The surgical team keeps one table ready while the surgeon is
working on the other. The surgeon merely turns and starts doing surgery on the other table as soon as he
finishes the current one. In this way, the valuable time of surgeon is used properly. Aravinds’ surgeons
take only 10 minutes per surgery while industry standard is 30 minutes. Aravind achieves this feat while
maintaining the world standard in quality. Its infection rate is only 4 per 10,000 cases as opposed to 6 per
10,000 in UK. And they are able to carry out 400 surgeries per doctor per month as opposed to the
average of 25 surgeries per doctor per month.
To cater to such high performing, large-scale surgical system, Aravind has to ensure that enough patients
come to it; partly to achieve this, Aravind organizes camps to attract patients in rural areas, Help of local
organizations like ions club is taken in publicizing the camps. They also of ten help with sharing of the part
of cost in transporting patients and other such activities. In these camps, patients go through the similar
steps of registration, vision recording. Preliminary examination, testing of tension, refraction, and final
examination. If a surgery is found to be required, patients additionally undergo BP and urine sugar test
and their surgery papers are prepared. Following this, patients are taken to the nearest Aravind for
surgery and brought back to the same place after three days. This is unlike many other camp organizers
who perform surgeries in the camps themselves.
For its hospitals, Aravind recruits nurses from the nearby villages. Aravind essentially looks for hunger to
do some good in such people before it trains them for the job. They need not have any nursing training
before coming to Aravind. Nurses typically do not leave Aravind because they tack the necessary
qualifications to get employed in other hospitals.
Aravind is finding it a little harder to recruit and keep doctors; it expects its doctors to work nearly 60
hours a week as opposed to 30 hours in many institutions. They tend to leave Aravind after few years as
they command higher salaries in the marketplace than what Aravind gives them.
Till few years back, Aravind used to provide only the intra-cap surgeries for free patients as the cost of in
ocular lens was high. Each in ocular lens used to cost Rs 800, as t had to be imported. In 1991, Aravind
set up a factory to produce 60,000 IOLs per year. Initially, it had a detect rate of 50% and the cost of
each lens worked out to be Rs 200/-. Over time, it was expected that the cost of the lens would drop to Rs
100/- as the factory improved its working. This factory was set up as a separate venture so that the
hospitals could keep their focus on eye care. Recently, the factory has also started manufacturing sutures
and other items used in the surgeries.
In a recent interview to two Indian business school professors, Mr. R. D. Thulsiraj, MD, Aravind Hospitals,
remarked that eye care has some unique characteristics that make it possible to transfer the model
directly. One characteristic is the high volume: about 20% of the population needs glasses and 1% has
cataract. Secondly, the intervention for the most part is one time, because it is not a chronic disease, or
one needing long-term treatment like cancer, Finally, intervention is quite low cost unlike, say, bypass
surgery. But Dr. V argued, “I think this model must work in other health care sectors also, whether it is
women’s heath or children’s health, or cancer or tuberculosis, People like you must explore and see where
this model can be applied, our main focus should be on improving the total health of the country
Exhibit 1
Exhibit 2
ARAVIND EYE HOSPITALS
Statistics—Year 2004
Outpatient Visits: 1,635,599
Surgeries: 228,894
Free Eye Camps: 1,271
Statistics—Year 1976—2004
Outpatient Visits: 17,778,075
Surgeries: 2,225,225
Free Eye camps: 20,995
QUESTIONS:-
1. What is the vision of AECS? What is the role of operations in meeting it?
2. Can this system be replicated to other aspects of health care? Other services? What will be the
problems? What will be the advantages?
3. How do different elements of AECS work together to deliver the vision of Dr. V?
4. What are some of the problems AECS facing? Are they inherent in its model or they could be rectified
while keeping the model intact?
Case – 2 Marks-15
On the night of Feb 28th, the last day of classes, Nilesh proposed to Geeta, his MBA classmate of nearly a
year and a half. Geeta agreed immediately and wondered if all her classmates will be able to attend their
wedding as once they all go back to their homes it would be really very difficult for everyone to get
together again. Suddenly, Nilesh came up with the idea: what if they got married on March 22nd? “But how
could it be? Our convocation is on March 21st Geeta said.
“Exactly! All our classmates will definitely come here for convocation and they would not mind staying an
extra day for the wedding. In fact, we will get the blessings of even their parents as many are planning to
come for the convocation.”
Geeta: Right. But so many things have to be done. That is also when the wedding season starts and all
the reception halls become unavailable. For our send-off party, juniors were saying that hotels were
insisting on 17 days notice. Of course, for Rs 5000/- extra the notice period can be reduced to 10 days.
Nilesh: I want my brother and sister-in-law to come for the wedding.
Geeta: But, they are in US and working. They will require at least 10 days before they can be here. Also
my parents will have to buy your sister-in-law a sari-set (sari with matching blouse and petticoat) as per
the tradition. She will have to be here well in time so that they can be fitted well.
Nilesh: And catering! It takes two days to choose the menu and Pandal decorations. Hotel Sayaji wants at
least 10 days notice period before the formal engagement ceremony (one night before the wedding).
Geeta: And what about our dresses? These days, it is better to get it made after choosing the pattern and
buying the material yourself. It would take three days to choose the pattern and eight days to order and
receive the material after
Nilesh: Yes. But the material supplier can deliver in five days if we pay an extra of Rs 1000/- for
expediting it.
Geeta: I want Joyti of Asha Boutique to work on our dresses.
Nilesh: But she charges Rs 500/- for one day of work.
Geeta: If I got my mother to do all the services, we could finish the dresses in 11 days. If Joyti helped, we
could cut that down to six days, at a cost of Rs 500/- for each day less than 11 days.
Nilesh: It would take another two days to do the final fitting. Then dry-cleaner will take two days to clean
and press the dresses unless we pay Ps 1000/- for the express service of single day delivery.
Geeta: That’s right. By the way, have you thought about invitations? Nobody will come unless we invite
them formally.
Nilesh: Anand Printing Press will take 12 days to print the invitation cards. Of course, they do have an
express service and can deliver in five days if we pay them extra Rs 1500/-
Geeta: It will take three days to prepare the matter which will be printed and select the styles.
Nilesh: Given the postal delays, the invitations have to go out at least 10 days before the wedding.
Geeta: Mailing them will take a day and that cannot be done until we write addresses on them. Addressing
will take four days unless we hire some help. We can finish addresses in two days if we hire a part-time
help for Ps 200/-.
Geeta: We also have to buy some jewellery items to be given as gift to my brother-in-law. It will take a
day to do that
Nilesh: But before we start writing address, we will have to prepare a guest list. We can’t afford to miss
out on anyone important, as that will have an impact on the relationship with them forever. We will have
to be really thorough on that. I think it will take four days to prepare an exhaustive guest list.
Geeta: That does sound like a lot. Now it certainly looks much easier to earn an MBA degree than get
married!!!
QUESTIONS:-
1. Given the activities and precedence relationships described in the (A) case, develop a network diagram
for the wedding plans.
2. Identify the paths. Which are critical?
3. What is the maximum cost plan that meets the March 22nd deadline?
Case -3 {Continuation of Case 2} Marks-15
Several complications arose during the course of trying to meet the deadline of March 21, for the Nilesh—
Geeta engagement. Since it was important for Nilesh and Geeta to get married on March 22nd, the
implications of each of these complications had to be assessed.
1. All hotels informed that the express booking had to be withdrawn that year as there was a mad-rush for
getting married, and therefore Nilesh and Geeta would have to give 17 days’ notice.
2.A call to the US revealed that brother and sister-in-law couldn’t leave till March 1st as they had urgent
deadlines at work.
3.Nilesh came down with four day flu just as he started to work on the guest list.
4. The dress material was lost in transit. Notice of loss was delivered to Geeta on March 10th.
5. There was an unplanned repair work at Sayaji on March 8. They informed that they would be closed for
two to three days.
QUESTIONS :-
1. Given your answers to the (A) case, describe the effects on the wedding plans of each incident
noted in the (B) case.
SECTION B Marks-30
Attempt all the questions:-
1 ) Br i ef l y s k et c h t h e pr o du c t d e v e l o pme n t p r o c es s .
2 ) Wh a t d o y o u me a n b y c o nt i n u o u s impr o v eme nt ? Gi v e two e x amp l e s o f
c o nt i n u o u s impr o v eme n t s t h a t or g a n i z a t i o n s u n d e r t a k e .
3 ) Su p p o s e y o u wa n t t o v i s i t y o ur b a n k t o d e p o s i t y o u r s a la r y c h e qu e a n d t h e n
wi t h dr aw s ome mo n e y f r om y o ur a c c o u nt . Us e y o u r k n owl e d g e o f pr o c e s s
ma p p i n g a n d d r aw t h e p r o c e s s .


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Business Ethics
N.B: 1) Attempt all the questions
2 )All Questions Carries equal Marks

____________________________________________________________________________
1.} Define business ethics. Why do we need to study business ethics?
2.} Define morality. Discuss some characteristics of morality?
3.} Briefly discuss utilitarianism. Discuss the problems of measurement.
4.} Make a presentation about two male and two female corporate executives that you admire?
5.} Define ecological ethics. Distinguish between private and social costs?
6.} Discuss the types of job discrimination. How can we determine job discrimination?
7.} What is affirmative action? Discuss some of the major arguments for and against affirmative action.
8.} Discuss why values are important for an organization. Discuss the importance of trans-cultural values.
Find out some cultural/business values of different countries.
9.} Discuss the characteristics of high-performing teams.
10.} Write a few paragraphs about an Indian organization that you admire. What are its values?

Business Strategy
N.B: 1} Attempt all questions

______________________________________________________________________________________
Case – 1 Marks-16
Leisure and entertainment usually gain prominence in an economy that is growing; fast and provides leeway
to the consumer to spend on things other than necessities India’s entertainment and media industry is one
of the sunrise industries, growing at a Compound annual growth rate of 18 per cent, much faster than the 9
per cent national economic growth rate. According to a study conducted by the Federation of Indian
Chambers of Commerce and Industry and PricewaterhouseCoopers the industry size is Rs. 437 billion
presently and is projected to grow to Rs. 1 trillion by 2010. Positive measures taken by the government,
technological advancement and entry of large corporate houses in all the segments of the industry are
fuelling the impressive growth.
Among the various segments of the industry, there, are radio, television, films, out-of-home advertising arid
live entertainment While radio and television make up the fastest growing segments, film entertainment
growing at 16 per cent annually, is another potential segment. The film entertainment segment of the
entertainment and media industry has several strategic groups that could be roughly categorized along the
value chain of film making and distribution These strategic groups could be production, distribution, retail,
music and home video. While many of the companies operate in more than one activity area on the value
chain, such as Yash Raj Films operating in all activity areas except retail, there are a few that concentrate
on just one or two activity areas, such as RGV Film Factory that operates only in production of films. Size
based on revenue could be another basis for categorization of the film entertainment companies in India.
Among the large size companies are Adlabs, Sahara, Percept, Yash Raj Films and UTV, that could touch or
exceed Rs. 1000 revenues by 2010. The middle-rung is of companies of revenue size of Rs. 300 — 500
crore, such as pure retail distribution companies such as lnox Leisure, P’SR Cinemas, Pyramid Saimira and
Valuable Group pure content companies such as Pritish Nan Communications Vishesh Films or RGV F
Factory. The third category is of emerging companies in the revenue size range of Rs. 1OC — 300 crore,
such as Real Image, Red Ice and Seven Entertainment Major investments in the media and entertainment
industry in recent years have been ploughed into infrastructure, largely into multiplex chains and digital
theatre chains. These investments are made by companies that are pure retail and distribution companies.
Among the major ones in this strategic group is the Chennai-based Pyramid Saimira Theatre Limited (PSTL)
– India’s largest theatre chain company with over 29 multiplexes operation, with over 371 screens in 2007,
project to increase to 2000 screens by 2010. It was incorporated in 1997 as Pyramid Films international
Private Limited and has gone through severe changes of name to emerge as Pyramid Saimira Theatre
Limited, reflecting its concentration on the theatre business, though it operated in film production and TV
content production in the past Film making and distribution in India has been traditionally an unorganized
and fragmented industry, managed through experience rather than systems. In recent years, one trend in
the film industry is corporatization Under corporatization the traditional organizations dealing with the
various aspects of film making’ and distribution. Become formal organizations registered under the legal
process, such as the Companies Act, 1956. Along with corporatization comes increasing professionalization
in the management of organizations. Technology, especially information and communication technology, has
played its part in heightening the chances of making corporatization and professionalization successful A
new breed of organization has emerged on the horizon that deals with the various activities in an organized
and Systematic manner. Pyramid Saimira intends to be of such organizations. The people behind Pyramid
Saimira include Mr. V. Natarajan, a Gemini-studio’s veteran of the Tamil film industry, Mr. P. S.
Saminathan, the finance and technology brain behind the flagship project and Mr. N.Narayanan, the
management man. The financials for the year 2006-2007, show net sales of Rs 1661.52 crore and net profit
of Rs. 158.82 crore on equity capital of Rs. 282.76 crore.
The flagship project of the Pyramid Saimira is the mega digital. Theatre chain project being implemented in
two phases, with a total cost of Rs. 414.5 crore. This is an information technology driven venture that is a
first-mover in the film industry in India. The basic idea is to have a chain of theatres for exhibition of films
that have been encrypted in the digital medium. The theatres are linked through a satellite-based
communication network. The films are released in the digital format and simultaneously exhibited in the
digitally- enabled theatres through the satellite network. The one-stroke release and exhibition of films is
claimed to reduce the chances of films being pirated, which is the Achilles’ heel of the film
industry in the world. It also avoids the use of costly film rolls and reels now used to photograph and
distribute films. The digitized theatres also offer the potential of developing them as value-added service
providers, enlarging their role from that of entertainment providers to commercial infrastructure providers
such as shopping malls, exhibition spaces and education and training venues.
The business model of the digital theatre concept is based on a vertically-integrated theatre chain on longterm
lease, where the revenue streams emanate mainly from the ticket sales at the individual theatres at
the demand end, much like it does now. The critical difference is on the supply side where the distribution,
retailing and exhibition of films are done in an integrated manner through digital means connected through
a communication network. This effectively eliminates the film distributor and tries to achieve economies of
scale through volume sales. The centralized network operating centre is the nodal supply point.
A standardized delivery process makes the process operationally low-cost, albeit at a high initial investment.
Additional revenue streams, generated through exploitation of the theatre infrastructure to provide other
services than entertainment, help to recoup the high initial investment. Creating a franchise system for a
long-term lease enables sharing of the initial high costs7 of realty by engaging partners who own the
theatre space but use Pyramid Saimira’s digital distribution and exhibition facilities at a price. There are
additional possibilities of creating content library of films, extending networks abroad and building
integrated family entertainment centers.
The digital theatre is a compact model, having various elements such as digital projectors, servers,
connectivity equipments, high-definition recorder and telecine, system integration and software solution
providers. For each of these, there are in-house and external agencies in partnership. For instance,
connectivity equipments are being provided by Tata Net while servers are arranged by a partnership of
Saimira Access Technologies with Real Image Media.
Pyramid Saimira’s SWOT analysis indicates the following factors:
• Strengths Established organization, experienced promoters and networking with financially strong and
capable partners.
• Weaknesses Lack of in-depth technological experience, risks of being the first-mover and limited financial
capability.
• Opportunities Favorable demographics, increasing spending on entertainment, potential expatriate
demand, availability of technological infrastructure such as broadband and digitized films a regenerative
asset that has multiple uses.
• Threats Unorganized film industry, fickle nature of demand for films, powerful industry bodies with political
lobbying capabilities, high entertainment taxes, piracy, high cost of infrastructure and faulty governmental
policy implementation.
Pyramid Saimira’s global ambitions are reflected in its vision statement, which is ‘to be the largest vertically
integrated theatre chain in the world carving a unique space in mass access using theatre infrastructure to
deliver education, entertainment and information at affordable cost to all sections of society’. The digital
theatre project is being implemented in Tamil Nadu and is planned to be expanded throughout India and
abroad in areas where there are a large number of Indian expatriates such as South East Asia, Europe and
the U.S. The acquisition of the Texas-based Fun Asia made through the subsidiary Pyramid Saimira
Entertainment America, targeting the Asian film market, marked the entry of Pyramid Sairnira in the U.S.
and Canada. There are subsidiaries operating in Singapore and Malaysia, where there is a substantial
number of people of Indian origin.
Questions:- (Any Two)
1. Attempt a Porter’s five- forces analysis for the Indian film industry, highlighting the factors relevant for
Pyramid Saimira’s strategic planning.
2. Attempt a strategic groups analysis highlighting the factors relevant for Pyramid Saimira’s strategic
planning.
3. Identify the subjective factors that may have an impact on the strategic choice made Pyramid Saimira.
Case –2 Marks-16
The origins of Deepak Nitrite—the flagship comp any of the Deepak group of industries-go back to 1970
when Chimanlal K. Mehta, an entrepreneur, sensing an opportunity in India’s drive towards self- sufficiency
and import substitution and relying on his trading and manufacturing experience, ventured into the
chemicals industry. The Company was originally incorporated as Deepak Nitrite Private Limited in 1970,
under the Companies Act, 1956 and was subsequently converted into a public limited company in the name
of Deepak Nitrite Limited in 1971. The company’s registered office is at Vadodara and its corporate office is
at Pune with manufacturing plants in Gujarat and Maharashtra. Net sales for the year ending March 2007
are about Rs. 4172 million and net profit is Rs. 357 million. Exports constitute nearly half of the sales.
Overt he years, Deepak Nitrite has grown impressively through a judicious use of integration, related
diversification and internationalization strategies, using the means of acquisition and restructuring. In 1983,
adopting a horizontal integration strategy, the company used foreign collaboration to start commercial
production of ammonia. In 1989, the group employed ammonia-based forward integration and also
diversified into the chemicals related area of methanol. In 1992 came the commercial production of lowdensity
ammonium nitrate, nitro phosphate and nitric acid, resulting in a multi-product portfolio consisting
of organic, inorganic, fine and specialty chemicals. Deepak Nitrite has made tremendous progress over the
years and has posted impressive financial results as well as excellent export performance. It (the growth of
the company), was born out of a process of deep thinking, strategy and planning,’ said the managing
director Deepak Mehta, who claims that planned strategy has led to growth. Environmental scanning led to
foreseeing the threats coming from a dismantled duty regime. Anticipating this, the company went about
implementing strategies that would convert these threats into opportunities. The strategic approach was to
build on its strengths in niche areas of the chemicals market, leverage strong R & D and a robust lab to
product ion skills, bring the strengths up to global levels and work towards a leadership position.
The success of Deepak Nitrite could be attributed to its focused strategy. Implementation capabilities. A
series of plans, programmes and project have been initiated and implemented over the years, in alignment
with its corporate and business strategies. For instance, it has worked on a number of R&D projects over
the years to develop its skills to swiftly transfer products from the labs through production to the markets.
It has effectively developed differentiating capabilities by planning and implementing projects for handling
bulk products to handling batch products, transforming from a commodity supplier to a value-added,
branded product supplier with customization skills. Projects in supply chain management have helped the
company in extending its ability to source its own raw material to tracking customers’ delivery and
inventory scheduling. Cost control has been attempted through wider sourcing; including international vend
ors, and investing in energy-saving equipments.
In the course of strategy implementation, Deepak Nitrite has to deal with a host of government agencies for
procedural implementation. For example, raising finance has taken it to SEBI. A continual interaction takes
place with the export and import regulatory authorities. For instance, anti-dumping duties have been levied
on the comp any for sourcing cheap materials from China. Being in the chemical processing industry, the
company is under the scrutiny of environmental protection agencies. It has been a signatory to the
‘Responsible Care’ initiative of the global chemical industry. It has also achieved the ISO 14001 certification.
Dealing with explosives, the company has to seek licenses from the Department of Explosives, Industrial
Safety and Health Departments and State Pollution Boards of Gujarat and Maharashtra. Apart from these
are the regulatory requirements dealing with taxation purposes. Resource generation has been through
raising money in the capital markets on the basis of its good reputation, internal accruals, loans from
commercial banks and financial institutions and sale of factory land at Pune.28
Questions:-
1. Identify and discuss briefly, the three themes of strategy implementation of activating strategies,
managing change and achieving effectiveness in the case of Deepak Nitrite.
2. picking up data from the case, demonstrate how formulation and implementation of strategy are
interdependent.
Case –3 Marks-16
Synergos# is a young management and strategy consulting firm based at Mumbai. It was established in
1992 at a time when there were a lot of expectations among the industry people from the liberalization
policies that were started the previous year by the Government of India.
The consulting firm is an entrepreneurial venture started by Urmish Patel, a dynamic person who worked
with a multinational consulting-firm at the He left his comfortable position there to venture into the
management consultancy industry the motivation was to be ‘the master of his own destiny’ rather than
being an employee working for others. Urmish comes from an upper middle-class Gujarati family, settled in
a small town in Rajasthan. His father was a government servant who retired with a meagre pension. His
mother is a housewife. His other siblings are all educated and well-settled in their respective careers and
professions. Urmish is a creative individual, uncomfortable with the status-quo. During his student days at a
college at Jaipur, he was continually coming up with bright ideas that some of his friends found to be
preposterous. To him, however, these were perfectly achievable ideas. He studied biotechnology and then
went to the US on a scholarship to do his Masters. After a semester at a well-known university there, he lost
interest and switched to pursue an MBA. He liked it and soon settled down to work with n American
consultancy firm and toured several countries on varied assignments during the seven years he worked
there. In 1992 came the urge to Urmish to chuck his job and be on his own. It was a risky, yet an exciting
step to take. His accumulated capital was limited— just enough to rent office space, buy a few computers
and hire an assistant. There were no consultancy assignments for the first three months. But an
acquaintance soon came to his aid, introducing him to the CFO of a major family business group who
needed advice on a performance improvement project they wanted to launch. The opportunity came in
handy though the returns were nothing to write home about. That project was the first step to many more
that came gradually. Synergos started gaining presence in the competitive management consultancy
industry and attracting attention from the people whom they worked for. Word-of-mouth publicity led them
from one project lo another for the first three years till 1995. Synergos took up whatever came its way,
delivering a cost-effective solution to its clients. A team of four had formed by now, each member of the
team specializing in services rendered to the clients. For instance, one of the members is a specialist in
engineering projects, while another has expertise in finance. The third one is a service sector specialist, also
having experience in dealing with government matters.
The phase of rapid growth started some time in 1995 when the Synergos team decided to focus on the
small and medium enterprises (SMEs). These were firms that realized they had problems needing specialist
advice; but were apprehensive to app roach the big firms on account of their limited outlay and
inexperience of dealing with such firms. Synergos came to their aid by tailoring their services as near as
possible to their needs. Another differentiation platform Synergos offered to its client was a fully-integrated
consultancy service where it got involved right from the stage of planning down to its implementation and
monitoring.
Presently, Synergos has grown to be a medium- sized consultancy firm, serving clients in India and abroad,
working for industries ranging from auto components to financial services and for manufacturing
organizations to service providers. Somehow, nearly half of the assignments it has worked on have been for
mid-sized, upcoming family- owned businesses, a niche it has served well. These organizations typically
need a boutique sort of consultancy that can offer customized services dealing with a broad range of
practices related to strategy, organization design, mergers and acquisitions and operational matters such as
logistics and supply-chain management. Synergos fits in with their requirements owing to its personalised
service and reasonable-commission structure. The organizational structure at Synergos has a board at the
top, consisting of seven people, including the four founding members and three independent directors. One
of the independent directors is the chairman of the board. Urmish, as the founder CEO, also heads an
executive management committee with each of the founding. Members, leading three other top-level
committees dealing with business portfolio, service management and executive recruitment.
The management team is called the professional group. The rest of the employees are ref erred to as the –
staff. -The professional group has young women and men who are graduates from some of the best
institutions in India and abroad. They are assigned to taskforces based on their qualifications, experience
and interests. The departmentation at Synergos is flexible, based on -an interplay of the three categories:
skill, service and specialty. For instance, a professional may have IT skills, may have worked to provide
supply- chain management services and developed expertise in handling operational assignments for
medium-sized food and beverage firms. There is a lot of multi-tasking however, to utilise the wide – range
of skills and special expertise that the professionals have For administrative matters the professionals are
assigned to client-service departments of industry solutions, enterprise solutions and technology solutions.
The flexibility that such an organisational arrangement affords seems to have been the major reason for the
evolution of the organization structure at Synergos over the years.
The staff group of employees consists of the support people who provide a variety of services to the
professionals. Among these are research assistants, industry analysts, documentation experts and
secretarial staff. There is no set pattern for assignment of staff to the administrative departments and
generally, a need-based approach is followed, depending on the workload at a particular time.
Recruitment for professionals is stringent. Synergos typically looks for a good combination of education and
experience and lays much emphasis on the compatibility of the prospective employee with the shared
values. Creativity, broad range of professional interests, intellectual acumen, team- working and physical
fitness to undertake demanding tasks and work for long hours are the criteria for hiring. There are not many
training opportunities except the on-the-job learning. New professionals are assigned to a mentor for some
time till they a ready to handle assignments autonomously. The staff members are usually recruited from
fresh graduates, with good degrees from reputed institutions, in arts, sciences and commerce. The staff
positions are also open for persons wanting to work on part-time or project-bases. Emphasis is given to the
ability of the prospective staff to undertake multi-tasking and work with documentation and word processing
and presentation software packages.
The compensation system consists of a base salary with commission and bonus depending on performance.
There are other usual elements such as medical reimbursement, loan facility and gratuity and retirement
benefits. The performance appraisal is informal, with at least one of the four founding members being part
of the evaluation committee for a professional. Usually, the found-c member closest to the work area of the
employee is involved in determining the rewards to be give’. The time-cycle for appraisal is one year.
Management control is discreet and performance-based rather than behavior-based. The means for control
are informal, such as direct supervision. Urmish is a strong proponent of the emergent strategy and is not in
favor of tying Synergos to a fixed strategic posture. So are the other founder members, though at times
they do talk about deciding on a niche such as the SME organizations as clients and enterprise solutions as
the core competence. In the highly fragmented consultancy industry where it is possible for even one
person to s up an office in a commercial area and leverage corrections to secure projects, Synergos is open
opportunities as they emerge, while trying to maintain the flexibility that has made it successful till no
Questions :- (Any Two)
1. Identify the type of organization structure being used at Synergos and explain how t works. What are the
benefits of using this type of structure? What are the pitfalls?
2. Express your opinion about whether the structure is in line with the requirements of the strategy that
Synergos is implementing.
3. Based on the information related to the information, control and reward systems available in the case,
examine whether these systems are appropriate for the type of strategy being implemented.
Case – 4 Marks-16
‘In a free enterprise, the community is not just another stakeholder in business, but is in fact, the very
purpose of its existence.’ This is a statement of the founder of the Tata group of companies, Jamsetji N
Tata. The thinking behind the statement probably drives the corporate social responsibility initiatives at the
Tata group of companies.
The Tata group describes itself as ‘India’s oldest, largest and most respected business conglomerates’, a
depiction that seems to be quite justified. The group’s businesses operate globally through 98 companies—
27 of them publicly-listed—in seven business sectors. There are nearly 2,90,000
employees working in these companies that have about 3 million shareholders. The group’s turnover in
2006-2007 was about Rs. 130,000 crore .There are five core values that guide the Tata group’s business
decisions: integrity, understanding, excellence, unity and responsibility. The value of integrity means
conducting business fairly, honestly and with transparency. Understanding involves caring, showing respect,
compassion and humanity for colleagues, customers and community. Excellence denotes striving constantly
to achieve high standards in work and quality. Unity implies building strong relationships with colleagues,
customers and business partners. Responsibility signifies giving back to the community and society.
The tradition of CSR is embedded in the history of the Tata group. The J. N. Tata Endowment Scheme was
established in 1892. Over the years, individual family members have created a constellation of trusts and
endowments that contribute to a wide range of CSR activities. In the words of J. J. Irani, ex-managing
director of Tata Steel: ‘Some people consider social responsibility as an additional cost; we don’t. We see it
as part of an essential cost of business, as much as land, power, raw materials and employees.’ This is seen
in the quantum of funding that is channeled into CSR. The Tata group contributes nearly 30 per cent of its
profit after tax, which is an unusually high figure, when other companies or business groups may take pride
in putting in just one per cent of profits into CSR. The high social investment come from the Tata trusts that
have a controlling interest in the holding company, Tata Sons. This ensures that the dividends paid out are
directed to CSR, making the Tata group companies unique in ensuring that personal wealth is converted into
social capital.
The Tata group has created a formal structure to direct CSR activities. The Tata Council for Community
Initiatives is a centralized agency consisting of the Tata companies’ CEOs, charged with the responsibility of
directing and coordinating the CSR activities across the group. It is headed by a member w of the group
corporate centre, one of the two 9overnance bodies, the other being the group executive office. This is an
indication of the high priority accorded by the Tata group to CSR. In order to create accountability, the Tata
group has a 1ctive evaluation system called the Tata Index Sustainable Human Development. The Index is a
set of guidelines for Tata companies looking to their social responsibilities. In the words of G. Nadkarni, vice
president, group corporate sustainability, ‘We have adopted a business model to drive social responsibility
efforts within the group because that way, you ensure a huge network. The index helps structure our
efforts and quantify their effect on the communities and people they are aimed at.’ Of significance is the fact
that the Tata Index for Sustainable Human Development is built around the Tata Business Excellence Model
that drives business decisions of the group companies. One of the several areas of business performance in
the model is of governance and social responsibility, indicating the strategic priority given to this issue by
the Tata group. Typically, business organizations have considered social responsibility as far removed from
their mainline business activities. Not so at the Tata group where CSR is a key element in the business
model. It is the responsibility of every company in the group to make CSR a component of its strategic plan.
Despite having a centralized network and structural arrangements, the individual Tata companies are
autonomous to choose whatever CSR initiatives suit the requirements of the communities they work with.
The strategy that each company evolves is required to be focused on the needs of the communities in which
the company works in. There is a conscious effort to match the strengths and cornpetencies of the company
to the developmental needs of the communities being served. Thus, the company is left free to determine
the scope of its CSR initiatives, be it in the area of arts and culture, civic amenities, education, environment,
health or infrastructure. For instance, the Tata Steel Rural Development Society works at Tata Steel for the
rural communities around the operational units, while the Tata Chemicals Society for Rural Development
does similar work for Tata Chemicals. Voltas for Women is an exclusively female society consisting of female
employees and wives of employees, who work on health and education issues for women. The Tata family
trusts consist of the Sir Dorabji Trust and Sir Ratan Tata Trust besides the J. N. Tata Endowment. Some of
the prominent Tata-funded institutions are the Indian Institute of Science, Tata Institute for Fundamental
Research and Tata Institute of Social Sciences.
Questions: –
1. Collect evidence from the case to support the argument that social responsiveness at the Tata group is
closely aligned with its strategic management,
2. How would you respond to a critic who says that the Tata group engages in CSR activities to enhance the
reputation of the Tata brand and thereby, benefit economically from its social responsibility initiatives?
Case – 5 Marks-16
Krishak Bharati Cooperative Limited (KRIBHCO) is a cooperative society set up for fertilizer manufacturing,
registered under the Multi-State Cooperative Societies Act, 1985. It was promoted by the Government of
India, Indian Farmers Fertilizers Cooperative Ltd. and National Cooperative Development Corporation and
other agricultural cooperative societies spread all over the country. It has more than 6000 members who
have contributed nearly Rs.400 crore as capital. KRIBHCO basically operates in the three business areas of
bio-fertilizers, urea and seeds. Its fertilizer complex is located at Hazira near Surat in Gujarat, seed plants
at various locat ions in eight states of India and service centers called Krishak Bharti Seva Kendra at various
places in the country. KRIBHCO has equity participation in fertilizer companies within India and in one
company in Oman. The cooperative is managed by a board of directors, senior management headed by a
managing director and functional heads in the areas of operations, finance, marketing and vigilance.
The vision of KRIBHCO is stated as: ‘We want to be a world class organization that represents the farmer
community and maximizes returns to them through specialization in agricultural inputs and products and
other diversified businesses that maximize stakeholder value.’ The mission is ‘to act as a catalyst to
agricultural and rural development by Selecting, financing and managing projects that are both socially
desirable and commercially profitable. The objectives are: to increase the urea installed capacity while
maintaining its market share to ensure optimum utilization of existing plant machinery and to diversify into
other core sectors like power, LNG terminal/port, chemicals etc.
The equity capital has been subscribed by ‘Government of India (67.6%) and other cooperative societies
(32.4%). Its, net worth is Rs. 22Sf crore, constituting equity of Rs. 396 crore and re serves of Rs. 1892
crore. It earned a post-tax pr* of Rs. 193 crore in 2006-2007 and has declared a dividend of 20% for the
last three years. The Cooperative has the distinction of paying the highest dividend and maximum taxes in
the cooperative sector in India. KRIBHCO markets its fertilizers through an extensive marketing network
spread over 16 states of India, through cooperative and institutional agencies and through its own outlets.
The cooperatives agencies in its marketing network are located at ferent levels such as apex, district and
taluka lea. and village-level societies. The institutional agencies typically involved are the agro-industries
corporations and land reclamation agencies.
KRIBHCO is an lSO-9001: 2000 and ISO-140C” certified company. It produced and dispatched
more than 34 lakh tonnes of urea in 2006-2007. Various functions of bagging, handling and loading in the
product handling plant are performed through manual product handling processes as well as through
mechanized bagging machines. Mechanical improvements have also been affected for smooth transfer and
conveying of bags in the bagging plant. These efforts have resulted in minimizing product loss, avoiding
shortfall or excess in loading quantities, minimizing the loading time and reducing the specific bag
consumption.
KRIBHCO has formal policies in the areas of energy, environment, quality and safety. It has declared its
energy policy and has volunteered its commitment towards energy conservation. The energy policy is aimed
at an optimum utilization of the various forms of energy in a cost-effective manner to conserve energy
resources. The Cooperative has set up a quality policy and an environment policy, which have been framed
after integrating the energy saving objectives and goals as well. The safety policy of the Cooperative
emphasizes on the importance of safety and to an adherence to safe practices. A safety department
performs the functions of ensuring compliance with safety standards.
KRIBHCO has a modest human resource development set-up where it arranges in-house training and
sponsors employees to external training programmers.
The management information system at KRIBHCO covers its internal operations and the marketing network
using the relational database management system, using client/server technology. An integrated system at
plant-level comprises of financial accounting, payroll, fixed assets, purchases, stores, production,
maintenance, transport ion, personnel & administration and MIS. Administrative and marketing offices have
financial accounting, inventory management, payroll and provident fund management systems. E-mail,
intranet and Internet facilities are provided at all offices. Computer training is provided to staff on a regular
basis. Information security is done through installation and upgrading of anti-virus programmers. With the
IT infrastructure being accessed from various locations, network and data security are important concerns.
The society has an official website at http://kribhco.net/english.
Vigilance is considered important at KRIBHCO, on par with other functional areas. It is aimed at preventive
as well as punitive vigilance and at en- swing transparency and accountability. The vigilance department
works for systems improvement and simplification and codification of rules and procedures for the smooth
functioning of the Society. There is a chief vigilance officer at the head office and vigilance officers at plant
and zone levels. There is a three-pronged vigilance policy in place, aimed at creating awareness, preventing
unethical activities and punishing misdemeanors. The board of directors oversees vigilance through sixmonthly
reviews. An internal enquiry was recently instituted to investigate allegations against the serving
marketing director, indicating the efficacy of the vigilance function.
KRIBHCO is exploring the possibility of setting up a joint venture fertilizer project in Algeria. KRIBHCO is in
the process of signing a memorandum of understanding with the Chhattisgarh State Electricity Board
(CSEB) to set up a 2000 MW power project. It is planning to enter the DAP mark et in India. KRIBHCO had
put in Rs. 50 crore for an all-India rail operations license for railway container operations. International
consultant KPMG is reported to have submitted a business plan to KRIBHCO for running container trains in
the area of Gujarat, Northern Maharashtra and Western Madhya Pradesh. KRIBHCO had signed a deal with
the Railways in 2007 for the operation of container trains for 20 years. It would tie up with other operators
to run the depot. KRIBHCO is keen on a roll out for the procurement of wagons. There have been problems
in the past between KRIBHCO and IFFCO as rivals in the fertilizer industry. Equity investment of Rs. 97
crore was retired by KRIBHCO to IFFCO which had equity participation. There have also been issues related
to the alleged interference of the Department of Fertilizer, Government of India, in the internal affairs of
KRIBHCO.
Questions:-
1. Keeping in view the status of KRIBHCO as an organization in the governmental cooperative sector,
comment on the adequacy of the functional policies in the light of what you have studied in this chapter.
2. Suggest directions for KRIBHCO’s top management regarding functional policies, in view of its ambitious
future Plans.

SUBJECT: Consumer Behavior

Note:- 1) Kindly write question number properly
2) Attached question papers with answer sheets
_____________________________________________________________________________
Case – 1 -Fashion Statement through Khadi
As India’s traditional hand-spun cotton fabric, khadi feels coarse and unrefined. But the feelings it evokes
in anyone with any empathy in India’s heroic struggle for emancipation from colonial rule, is anything but
that.
Till date the fabric bears the invisible-but-indelible imprint of the charkha (spinning wheel), the late
M.K. Gandhi’s revolutionary symbol for self-reliance and emancipation (through unity, expressed in the
refusal to kneel before insolent might). Instead of exporting raw cotton and importing fine Manchestermade
cloth, freedom fighters wanted all Indians to spin their own clothing and boycott imports to weaken
the British Raj.
With the end of Colonial Rule in 1947, the congress government headed by Jawaharlal Nehru opted
for state-led large-scale industrialization, instead of Gandhi’s idea of rule hut-industry development. But it
also decided to provide employment to thousands of spinners by selling their output through a vast
network of retails stores.
Thus was formed the Khadi and Village Industries Commission (KVIC), a nodal agency to promote
the fabric, with its Khadi Bhandar outlets in urban India.
Over the years, KIVC set up thousand of outlets across India. Sales were good. But with the
evolution of technology, perhaps it was inevitable that the sentimental dreams of village self-reliance
would be disrupted. And so it was. Modern machines of Europe’s industrial revolution were soon to arrive.
Indian industrialists set up capital-intensive textile mills and began the mass-production of fine cloth. As
the mills gained volume, they achieved economies of scale and started lowering prices. And so, the
labour-intensive homespun fabric losing out to mill fabric.
Driven by its sentimental attachment to Khadi, and concern for mass-scale-sector employment, the
government started subsidizing India’s traditional spinners. This was an extension of its ‘tax-the-rich’ and
‘feed-the-poor’ outlook, and was projected via the media as a good thing. In any case, KVIC was intended
to be a noble organization, motivated by lofty ideals instead of profit. For decades, all was fine behind the
‘khadi’ curtain of socialism’. The reason behind the support mechanism even acquired a holiness of its
own. Institutionalized, it became immune to doubt. But alas, the system was artificial and its main flaw lay
in the very ‘certain’. Public information was lacking, and so it escaped proper scrutiny. In the real would,
even the best-international projects can fail, or worse, degenerate into instruments for patronage.
But the 1990s, the vision of clothing the masses with khadi was beginning to look absurd. Despite
all policy incentives to the sector, people were buying efficiently machine-made textiles. The forces of
mass production were making polyester, which had gained economies of scale at the raw materials stage
(made from petrochemicals), cheaper still. Yet KVIC continued to produce huge quantities and sell khadi
clothes through its extensive retail chain. By now, khadi was more expensive than other fabrics and had
acquired the image of an outdated clothing material worm chiefly by politicians and social workers.
Ordinary people preferred cheaper alternatives.
Was khadi a lost cause-stuck in the time wrap? Clearly, if KVIC continued the way it was; it was
headed for trouble. Given India’s poor fiscal health, subsidies had become untenable. Yet, the fabric
couldn’t be torn out from consciousness of caring Indian. Something needed to be done. And fast.
By the start of the new century, KVIC discovered a pragmatic solution based on using modern
marketing to revive the fabric. After all, the Free Market can also accommodate common sentiments.
Instead of directing taxpayers’ money towards the cause, it was thought that private citizen should
contribute on their own volition (by buying khadi at premium prices).
The strategy? Refurbish the range, acquire an upscale image, aim the cloths at the well off and
reposition khadi as a fashion statements. Given KVIC’s lineage, the idea was radical. But it was worth a
try. KVIC started with a single-outlet experiment in Delhi’s Khan Market. The first air-conditioned shop
opened here in May 2001, selling khadi muslin garments designed by high-profile designers (Rohit Bal and
Malini Ramani), in addition to a well-packaged range of Ayurvedic products. It was a runaway success,
with Delhi’s elite thronging the shop.
KVIC started marketing two brands, Khadi and Sarvodaya, to which it owns the rights. The former
caters to the premium and export segments, and include essential oils, herbal oil soaps, face scrubs, and
dry fruits honey. Sarvodaya, the mass-market brand, sells mass items such as toilet soap, honey, pickles,
spices and incense sticks.
The move has also sparked off a controversy. Some Gandhians, troubled by the glamour, are
aghast at this ‘betrayal of ideals’. Realists, however, criticize them for failing to free themselves of their
dearly held ‘khadi mindset’. Don’t get them wrong. The latter love the old idealism too. But they also
realize that a product with great symbolic value deserve to be marketed as such, if it is to reach out, and
with mind-space for the poor weaver’s child who might have something to offer if given a chance. Holding
Gandhi’s method (or tools) as sacred amounts to confusing the means with the end.
The capital’s response to Khan Market shop has been so good that KVIC wants to upgrade a
significant fraction of its network. The transformation is to be entrusted to a new marketing company that
will function as any other professional firm. Plans to extend the concept include display units at airports
and modern outlets at Delhi’s Ashoka Hotel, Nehru Place, Hauz Khas, and Kamla Nagar. Next on the
agenda: Jaipur, Chandigarh and Lucknow. What’s more, the sales personnel are to be retrained for
customer orientation at the shop-floor level. The sale boost is expected to be substantial. The Khadi Gram
Udyog store at Connaught Place, New Delhi does an annual turnover o Rs. 10 crore. After renovation, this
is expected to touch close to Rs. 25 crore.
The product range will be widened too. Ahmedabad’s National Institute of Design (NID) has
proposed a special cell for design support, while Delhi’s National Institute of Fashion Technology (NIFT)
may also pitch in.
KVIC has hired three and agencies to promote its brands: Appeal for Khadi; Market Missionaries for
Sarvodaya and Pressman for the corporate and promotional schemes. The budget is about 25 crore. Khadi
campaign is likely to start by highlighting the brand’s eco-friendly credentials, before turning attitudes
towards it and portraying it as a lifestyle insignia.
Vivek Sahni has been roped in to do the packing graphics and retail outlets. E-commerce options
are also being weighed, with KVIC having already booked khadi.com and khadi.org as its domain names.
The export thrust will also be sharpened. Right the around 200 production units, which cater
exclusively to the export to the market. KVIC wants to identify new markets and tap them with its
products. Test marketing efforts are already underway in South Africa, Dubai, and a few other overseas
markets.
QUESTIONS:-
1. Would marketing in foreign countries require study of a popular country’s culture aspects and
buyer behaviour before marketing Khadi there? What aspects would need to be studied?
2. Suggest an approach to make Khadi garments popular among Indian youth.
Case-2- Purchase of a Microwave Oven
Ramesh Sikand and his family lived a comfortable two-bedroom flat in a respectable locality in a large
city. He was employed with a general insurance company in a supervisory capacity. His wife, Sumita was
a teacher in an English medium public school. Both their children, Rachit aged 10 and Sarita aged 8
years, were studying in the same school where Sumita was employed.
Just before Diwali in 2002, one Friday evening the family went shopping. Besides clothes for
children and few other things, they bought a 27 liter. Excel microwave from an outlet with good
reputation. Sumita was very happy and the children were excited with this new purchase. Both the
children were anticipating quick cooking of a variety of dishes they liked. They were expecting that
everyday their mom would give them school Tiffin-boxes packed with noodles other Chinese food.
To celebrate, Sumita invited two of her school colleagues for dinner and prepared a few dishes in
her brand new microwave. Both her friends observed her cooking with great interest. On the dinner table
most talk was around difficulties of both spouses being employed and the shortage of time to attend to so
many household chores. The friends, Ramesh and the kids profusely praised the dishes and how quickly
everything for the dinner was ready. What really took most time was cooking the Chapatis. Sumita said,
“ How nice and convenient it can be if some portable chappati-preparing gadget was available.”
Ramesh said, “It was my idea to buy a microwave. “Sumita said, “Why? You have forgotten. It
was I who two years ago during exam time suggested that it would be good if we buy a microwave.” Both
of them were trying to take credit for the purchase. Finally, both of them agreed that the idea to buy a
microwave was discussed after they attended the dinner at a friend’s place where for the first time they
saw a microwave in operation.
One of Sumita’s friends asked, “why did you buy this particular brand? I have read in the
newspaper just a few days back that there are attractive schemes on some brands.” Sumita and Ramesh
spoke simultaneously,” In fact, both of us have read advertisements and articles in magazines within the
last six months about what features and benefits every brand offers. “Sumita said, “As and when I got
the opportunity, I consulted some of my knowledgeable friends who have owned microwaves for quite
some time, what to look for and what brands to consider.” “You know, I came across some scaring
information about the safety of microwaves. Now the technology is so advanced that all those scaring tit
bits of information are quite baseless. ”Ramesh said, “Whatever we learned from magazine articles and
experienced friends has helped us quite a lot in buying this brand.” Sumita said, “About schemes, you are
right. We too got a set of three bowls to be used for microwave cooking. Besides, we have paid just a
thousand rupees and the rest would be paid in fifteen interest free installments. There is an extended
warranty of three years, and if we are not satisfied with the machine, we can return it within the first 30
days of purchase, and no questions asked. Our Rs.1,000 would be refunded in cash.”
One of Sumita’s friend said, “Recently, one of my relations in Delhi told me her bad experience with
this brand. She went to the extent of suggesting me never to buy this brand of microwave.” Ramesh said,
“I don’t know what to say about your relation’s experience. What information we could collect goes quite
in favor of this brand. Those who recommended it have had few years use experience without any
complaints.” Sumita’s friend said, “You may be right Bhaisaheb. But one thing we all know is that these
are machines and they are not perfect. Excellent cars with unmatched reputations like BMW, Rolls Royce,
and Mercedes too, need repairs.” She smiled, and said, “Haven’t you heard of Murphy’s Law “If a thing
can go wrong, it will”.
At about 10.30 pm, the friends thanked Sumita and Ramesh, and congratulated them for owning a
microwave and left. Sumita and Ramesh were a bit pensive after their departure. They felt somewhat
uneasy about the correctness of their decision in choosing this particular brand of microwave. They knew
their money was safe, but it would be embarrassing if they had made a mistake. They agreed to discuss
the matter with some of their eexperience3d friends.
QUESTIONS:-
1. Discuss whose decision it was to buy a microwave and when was the purchase decision made.
2. What factors influenced the purchase of the microwave?
3. What is likely to be the post-purchase behavior in this case and what is the significance of such
behavior?
4. What is the significance of post-purchase behavior for the marketer?
Case-3- Fancy Dreams
The boardroom was filled with the voice of marketing manager, Ashutosh Kant. He was addressing the
meeting of senior managers of Fancy Dreams. “The last three months were spent by our market research
team in finding out the reasons and patterns of sales at stores. Let me emphasize that retail sales is
showing growth all over the country and in the process, competitions is intensifying. We can no longer
afford to sit and relax, instead we need to put ourselves fully to retain our market leadership.” There facts
revealed by the survey were particularly disturbing.
1. People found Fancy Dreams service staff bordering on aggressiveness and not really helpful, as
customers were never left to browse.
2. Children got bored and hence parents often left the store within minutes after finishing essential
shopping. They never browsed or spent leisure time at Fancy Dreams store, which could otherwise
help promote sales.
3. With many choices available in the market, consumers stopped treating Fancy Dreams store as
unique and exclusive anymore.
Rehman, an entrepreneur, had set up a garment shop in one of Delhi’s busy up market area about 10
years ago. He realized that to attract customers, he must do something new. With this in mind, he
chalked out a detailed plan to open a chain of stores called Fancy Dreams. Some major features of this
store were:
1. Complete dress range for kids, parents and teenagers.
2. Full accessories for women and in footwear, purses, jewelry and cosmetics.
3. A play center where kids could spend time when the parents shopped.
The stores were opened in two locations in Delhi on an area of 10,000 sq.feet each. Within six
months, the stores became popular and the business grew rapidly and in three years the turnover crossed
Rs.6 crore. The promotion plans included advertising in print media and through cable operators. The
store also conducted festivals such as children’s carnival, and Valentine special etc., to attract crowds of
customers.
Stress on store ambience was high as Rehman wanted to create an image of a complete shopping
experience for the entire family. The sales personnel were carefully selected and trained to promote, not
push, any product and to encourage customers to browse through.
The women’s section was given a feminine touch and the men’s section had polished wood and leather
all over. The garments, the accessories, and the gifts were displayed in large racks and
Full-length mirrors were placed in multiple places. Sales personnel present on all the three floors often
advised the customers but never showed around everything. The kid’s section included garments, toys,
books, and was manned by more staff. The play center for the kids was a major attraction. The parents
could safely leave their children in the place, situated on the ground floor itself. The place had separate
section of toys and books for children and was supervised by trained staff. They felt comfortable that
their children would be taken care off properly and the parents, therefore, could leave the children and
shop in a relaxed manner. This concept was unique and highly appreciated by customers and became the
major attraction for them.
The stores were one of a kind in the early 1990s and grew rapidly. The new sections on books, gifts,
and handicrafts were launched gradually and at any time the store had more than 200 categories of
products. During this time, the competition started intensifying as three similar ventures were launched in
the city. This didn’t bother Rehman much, because he felt he had built and image of Fancy Dreams being
the ultimate store. By 1996, multi-storey, one-stop stores became the trend in Delhi and many such
stores came up.
Rehman had expanded his stores in three other cities as well and the turnover had crossed Rs.40
crore. The total manpower rose to 500 and several new management and non-management cadres were
introduced in the company.
Last year during Diwali festival season, the store attracted nearly 40,000 customers in the entire
month. This worried Rehman as it was almost 20 percent less than their estimates. His marketing
manager, after ling discussions, hired a market research firm to study the buying pattern and preferences
of people walking in the store.
QUESTIONS:-
1. Identify the relevant major problems and issues in this case.
2. Suggest a strategy to rectify the problems.
Case -4- Impact of Retail Promotions on Consumers
Shoppers Delight, a large retail store, had above average quality and competitive prices. It advertised its
retail promotions in local newspapers. Its TV advertising was mainly aimed at building store image and
did not address retail promotions. The management knew it well that they had to advertise their retail
promotions more, but they did not feel comfortable with the effectiveness of present efforts and wanted to
better understand the impact of their present promotions.
To better understand the effectiveness of present efforts, a study of advertising exposure,
interpretation, and purchases was undertaken. Researchers conducted 50 in-depth interviews with
customers of the store’s target market to determine the appropriate product mix, price, ad copy and
media for the test. In addition, the store’s image and that of its two competitors were measured.
Based on the research findings, different product lines that would appeal to the target customers
were selected. The retail promotion was run for a full week. Full-page advertisements were released each
day in the two local Hindi newspapers, and also in one English newspaper that devotes six pages to the
coverage of the state.
Each evening, a sample of 100 target market customers were interviewed by telephone as follows:
1. Target customers were asked if they had read the newspaper that day. This was done to
determine their exposure to advertisement.
2. After general description of the product lines, the respondents were asked to recall any related
retail advertisements they had seen or read.
3. If the respondents were able to recall, they were asked to describe the ad, the promoted products,
sale prices, and the name of the sponsoring store.
4. If the respondents were accurate in their ad interpretation, they were asked to express their
intentions to purchase.
5. Respondents were also asked for suggestions to be incorporated in future promotions targeted at
this consumer segment.
Immediately after the close of promotion, 500 target market customers were surveyed to
determine what percentage of the target marker actually purchased the promoted products. It also
determined which source of information included them in their decision to purchase and the amount of
their purchase.
The results of the study showed that as exposure was 75 percent and ad awareness level was 68
percent and was considered as high. Only 43 percent respondents exposed to and aware of the ad
copy could accurately recall important details, such as the name of the store promoting the retail sale.
Just 43 percent correct interpretation was considered as low. Of those who could accurately interpret
the ad copy, 32 percent said they intended to respond by purchasing the advertised products and 68
percent said they had no intention to buy. This yields an overall intention to buy of 7 percent. The
largest area of lost opportunity was due to those who did not accurately interpret the ad copy.
The post-promotion survey indicated that only 4.2 percent of the target market customers made
purchases of the promoted products during the promotion period. In terms of how these buyers learnt
of the promotion, 46 percent mentioned newspaper A (Hindi), 27perecent newspaper B (Hindi), 8
percent newspaper (English), and 15 percent learnt about sale through word-of –mouth
communication.
The retail promotion was judged as successful in many ways, besides yielding the sales worth
Rs.900,000. However, management was concerned about not achieving a higher level of ad
comprehension, missing a significant sales opportunity. It was believed that a better ad would have at
least 75 percent correct comprehension among those aware of the ad. This in turn would almost
double sales without any additional cost.
QUESTIONS(Any Two):-
1. Why would some consumers have high-involvement levels in learning about this sales promotion?
2. Is a level of 75 percent comprehension realistic among those who become aware of an ad? Why or
why not?
3. Do you think such promotions are likely to influence the quality image of the retail store? Explain.
Case- 5- Tattoos and Extended Self
Most product and services associated with extended self and physically separated from the
physically self. Until recently, exceptions were limited primarily to hairstyles and coloring and cosmetics.
One could also alter the physical self through excersise,diet,weight training and plastic surgery. In recent
years, body piercling and tattooing have become additional ways to alter both the extended self and the
physical self. Tattooing is unique (expect for plastic surgery) in that it is a relatively unalterable change to
physical self. It can be done primarily for adornment or beauty enhancement reasons. Or, it conserve
primarily as public or private symbol.
For most of this century, tattooing was not socially acceptable among most social groups in the
United States. The most noticeable exception was enlisted men in the Navy, and even then alcohol
consumption was frequently involved in the decision to secure a tattoo. This has changed sharply in the
recent years. Why has this become socially acceptable and what does it mean it man to the self concept of
those who secure tattoos? Research on tattoo focuses on four themes – the renaissance of tattooing, the
impact of the tattoo on the extended self, the risks associated with acquiring a tattoo, and the satisfaction
/ dissatisfaction that can result.
A tattoo renaissance began in the 1960s with the hippie movement and the evolution of skilled
tattoo artists in the San Francisco area. Interest also began to grow in the historical and ethnographic
aspects of the tattoo medium. The commercial art world and academic art historians began to pay
attention to tattooing as an art from. This, in turn, attracted better tattoo artist. By the early 1990s public
figures, particularly athletes began to wear visible tattoos, which increased their acceptability among the
more venturesome member of “mainstream” society. Tattoos have meaning on at least three levels. First,
there is the meaning associated with having a tattoo .While increasingly common, having a tattoo is still
far from the norm. Thus, having a tattoo in and of itself makes a statement about the person. A person
.with a tattoo is still viewed as somewhat of a risk taker or non –conformist .The location of the tattoo also
contains meaning. The more visible the tattoo, the more rebellious or non – conforming the individual
appears to be. The tattoo itself is a major source of meaning, both private and symbolic. Tattoos may
symbolize group membership, interests, activities, relationship, life transition, or values. Tattoos may be
unique and failed primarily with personal meaning or their meaning may be rooted in the cultural practice
and myths.
Acquiring a tattoo is risky. It is very expensive to remove or alter a tattoo .Thus , if you don’t like
your tattoo or your tastes change over time , you are at financial risk ., There is also the social risk that
one’s current or future friends , colleagues , or employers will have a negative reaction to the tattoo.
Finally, there is still physiological risk associated with acquiring a tattoo.
Ultimately, there is evaluation and satisfaction or dissatisfaction. As mentioned earlier,
dissatisfaction is difficult and expensive to correct. Satisfaction, often at a high level, is a frequent
outcome. Some research indicates that this may even produce addiction.
(Source advances in consumer Research, ed J. W. Alba and J. W. Hutchinson, 1998)
(Authors’ note: Tattooing has been in India for the last several decades. Rural people visiting meals
were to get their names tattooed on their forearms. Womenfolk were more interested in getting some
design or flowers tattooed. Probably, they did not have such complex psychological reasons as the
research in United States shows. In acquiring a tattoo, the new generation youth may be having complex
psychological reasons as reported in the study).
Question:- (Any Two)
1. What is the significance of acquiring a tattoo in India? Are tattoos considered a way of making a
personality statement/
2. Contact two educated persons who wear a tattoo (just not the name).Interview them to find out
what does it mean to them?
3. Interview three of your friends. Find out about their self- concepts and what kind of tattoo would
they like have.