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MANAGEMENT
SCIENCE
ChandraSekhar Patro
CSP
MANAGEMENT SCIENCE
(Common to Chemical, CSE, IT, ECE, EEE)
Course Code: 13HM1102
SYLLABUS
UNIT-I
INTRODUCTION TO MANAGEMENT:
Concept- nature and importance of management- functions of management- evolution of
management thought- decision making process- designing organization structure- principles
of organization types of organization structure.
UNIT-II
OPERATIONS MANAGEMENT:
Principles and types of plant layout- work study- statistical quality control- control charts (R
Chart, P Chart & C Chart- Simple numerical problems) materials management- Need for
Inventory Control- EOQ, ABC Analysis(Simple numerical Analysis)- Types of Inventory
Analysis (HML. SDE, VED, FSN Analysis).
UNIT-III
HUMAN RESOURCE MANAGEMENT:
Concept of HRM, HRD and PMIR- Functions of HR Manager theories of motivation and
leadership styles- Job Evaluation and Merit Rating, Welfare measures-statutory and non
statutory compliance grievance handling
UNIT-IV
MARKETING MANAGEMENT:
Marketing Management- Functions of Marketing Management- Marketing mix-Market
segmentation - Marketing strategies based on product life cycle- Channels of Distribution-
Consumer Behavior and marketing research
UNIT-V
PROJECT MANAGEMENT:
Project planning and control- Project life cycle- Development of network- Difference
between PERT and CPM- Identifying critical path- probability of completing the project
within the given time, cost analysis, - project crashing (simple numerical problems).
TEXT BOOKS:
1. Ramanujam Naidu & Sastry, Management Science, 1st Edition, Himalaya
Publishers, 2012.
2. Vijaya Kumar & Appa Rao, Management Science, 1st Edition, Cengage Publishers,
2012.
3. AR Aryasri, Management Science, 4th Edition, Tata McGraw-Hill, 2009.
REFERENCES:
1. P Khanna, Industrial Engineering & Management, 2nd Edition, Dhanpat Rai, 2004.
2. Martand Telsang, Industrial Engineering & Production Management, 2nd Edition,
S. Chand & Company, 2008.
Unit-1: Introduction to Management 1.1 CSP
UNIT I
INTRODUCTION TO MANAGEMENT
CONCEPT OF MANAGEMENT
Management is what managers do. It refers to the people at top level in the
organization. It is often viewed as maneuvering, i.e. doing something cleverly to change a
situation and make things happen the way you want them to. It has drawn the concepts and
principles from a number of disciplines such as economics, sociology, psychology,
anthropology, and statistics and so on. There are a variety of views about the term
management. Traditionally, the term "management" refers to the activities (and often the
group of people) involved in the four general functions (planning, organizing, leading,
controlling).
Another common view is that "management" is getting things done through others. To
most employees, the term "management" probably means the group of people (executives and
other managers) who are primarily responsible for making decisions in the organization. In
non-profit organizations, the term management might refer to all or any of the activities of the
board, executive director and/or program directors.
Human Physical
Resources resources
Effective and
Managerial efficient Goals
activities utilization
Financial
Resources Information
resources
In general, management is a set of activities directed at the efficient and effective
utilization of resources in the pursuit of one or more goals. Different scholars from different
disciplines have expressed their views on management. For example, economists have treated
management as a factor of production; sociologists have treated it as a class or group of
persons; practitioners have treated it as a process comprising different activities.
Definition:
1. According to Harold Koontz, Management is an art of getting things done through
and with the people in formally organized groups. It is an art of creating an
environment in which people can perform and individuals and can co-operate towards
attainment of group goals.
2. According to F.W. Taylor, Management is an art of knowing what to do, when to do
and see that it is done in the best and cheapest way.
3. According to Henry Fayol, To manage is to forecast and to plan, to organize to
command, to coordinate and to control.
Therefore, we can say that good management includes both being effective and
efficient. Being efficient means doing the task correctly atleast possible cost with minimum
wastage of resources. Management is a process involving planning, organizing, staffing,
directing and controlling human efforts to achieve stated objectives in an organization.
NATURE OF MANAGEMENT
The study and application of management techniques in managing the affairs of the
organization have changed its nature over a period of time. The following points will describe
the nature of management:
1. Management is a Social process: Management is done by people, through people
and for people. Social process refers to a series of activities that are performed in the
society. These activities are carried out by administrators, politicians, economists,
doctors, lawyers, parents, etc.
2. Management is goal oriented: Management involves achieving certain goals; it has
no justification to exist without goals. The basic goal of management is to ensure
efficiency and economy in utilization of human, physical and financial resources.
3. Management is Universal: Management is an essential element of every organized
activity irrespective of the size or type of activity. All types of organizations require
management. Managers at all levels perform the same basic functions.
4. Management is a continuous process: Management is dynamic and an on-going
process. The cycle of management continuous to operate so long as there is organized
action for the achievement of group goals.
Management as a Science:
Science means a systematic body of knowledge pertaining to a specific field of study.
It contains general principles and facts which explains a phenomenon. These principles and
theories help to explain past events and may be used to predict the outcome of actions.
Scientific methods of observations and experiments are used to develop principles of science.
Management as an Art:
Art implies the application of knowledge and skills to bring about the desired results.
The essential elements of arts are:
1. Practical knowledge: Every art signifies practical knowledge. For example, a person
cannot become a successful manager simply by reading the theory and getting a
degree. He must also learn to apply his knowledge in solving managerial problems in
practical life.
2. Personal skill: Every artist has his own style and approach to his job. Every manager
has his individual approach and style in solving managerial problems. The success of
a manager depends on his personality in addition to his technical knowledge.
3. Result-oriented approach: Arts seeks to achieve concrete results. The process of
management is also directed towards the accomplishment of desirable goals. Every
manager applies certain knowledge and skills to achieve the desired results.
4. Creativity: Art is basically creative and an artist aims at producing something that
had not existed before. A manager effectively combines and coordinates the factors of
production to create goods and services.
5. Improvement through people: Practice makes one perfect. Every artist becomes
more and more efficient through constant practice. A manager gains experience
through regular practice and becomes more effective.
FUNCTIONS OF MANAGEMENT
Management is a process of the quality of both physical as well as human resources to
seek objectives. The elements or activities which are performed in this process are known as
functions of management. Various authors have classified these functions differently:
Writers Management Functions
Henry Fayol Planning, Organizing, Commanding, Coordinating, Controlling
PLANNING
The first function of the manager is planning. It is also the foremost and the essential
function. Planning defines the goals and objectives to be reached in the plan period. It also
consists of policies, procedures, methods, budgets, strategy and programmes that are needed
to achieve the goals set. Decision-making is the most important and integral part of planning.
Planning is the most basic and pervasive process involved in managing. It means
deciding in advance what actions to take and when and how to take them. Planning is needed,
firstly for committing and allocating the organizations limited resources towards achieving
its objectives in the best possible manner and, secondly for anticipating the future
opportunities and problems.
Planning is putting down in black and white the actions which a manager intends to
take. Each manager is involved in planning though the scope and character may vary with the
level of the manager. Planning involves determination of objectives; forecasting; formulation
of policies and programmes; and preparation of schedules.
ORGANIZING
Organizing is to give a proper shape to the structure that should execute the plan
smoothly to achieve its success. It is the function of putting together different parts forming
an enterprise and makes it an organic whole to enable it to carry out defined operations.
Various activities to fulfill the goals have to be grouped and these are to be assigned to
people in-groups or departments. The authority, responsibility, accountability needed at each
level to execute the plan is to be defined and delegated.
Organizing simply can be defined as a process that results in organizational structure
through departmentalization, linking departments together, defining authority and
responsibility and prescribing authority relationship sub activities. The organizing function
deals with all those activities that result in the formal assignment of tasks and authority and a
coordination of effort. The supervisor staffs the work unit, trains employees, secures
resources, and empowers the work group into a productive team.
STAFFING
It is the function of manning the organization structure and keeping it manned.
Staffing has assumed greater importance in the recent years due to advancement of
technology, increase in size of business, complexity of human behavior etc. The main
purpose of staffing is to put right man on right job i.e. square pegs in square holes and round
pegs in round holes.
The staffing function involves identifying/selecting the right person for executing
each task planned. By carrying the functions of organizing and staffing the "plan" is
transformed from a document level to the operational stage. Having found the right
candidate, it is equally important that you are able to retain him. Among other things,
motivation and leadership provided by the top management of organization also plays an
important role.
The staffing function includes all the jobs connected with:
Manpower Planning;
Recruitment; Selection & placement;
Training & development;
Remuneration, Performance Appraisal;
Promotions & Transfer.
DIRECTING
It is that part of managerial function which actuates the organizational methods to
work efficiently for achievement of organizational purposes. It is considered life- spark of the
enterprise which sets it in motion the action of people because planning, organizing and
staffing are the mere preparations for doing the work. Direction is that inert-personnel aspect
of management which deals directly with influencing, guiding, supervising, motivating sub-
ordinate for the achievement of organizational goals.
The function of directing embraces the following activities:
a. Issuing orders and instructions.
b. Supervising (overseeing) people at work.
c. Motivation, i.e. creating the willingness to work for certain objectives.
d. Communication, i.e. establishing understanding with employees regarding plans and
their implementation, and
e. Leadership or influencing the behavior of employees.
Direction has following elements:
1. Supervision: implies overseeing the work of subordinates by their superiors. It is the
act of watching & directing work & workers.
2. Motivation: means inspiring, stimulating or encouraging the sub-ordinates with zeal
to work. Positive, negative, monetary, non-monetary incentives may be used for this
purpose.
CONTROLLING
Control is the tool for course regulation as the organization marches ahead and
correcting it when it diverts off-course. The results of the activity must confirm to the laid
down standards and all variations should be analyzed and root cause identified. Controlling
includes ongoing collection of feedback, and monitoring and adjustment of systems,
processes and structures accordingly. Examples include use of financial controls, policies and
procedures, performance management processes, measures to avoid risks etc.
Planning and controlling go hand in hand. There can be no control without a plan and
plans cannot be successfully implemented in the absence of controls. Controls provide a
means of checking the progress of the plans and correcting any deviations that may occur
along the way. It implies measurement of accomplishment against the standards and
correction of deviation if any to ensure achievement of organizational goals.
The purpose of controlling is to ensure that everything occurs in conformities with the
standards. Controlling is the measurement & correction of performance activities of
subordinates in order to make sure that the enterprise objectives and plans desired to obtain
them as being accomplished.
MANAGEMENT LEVELS
Definition:
Scientific management is concerned with knowing exactly what you want to do and
then see in that they do it in the best and cheapest way.
Taylor was concerned with the problems of increasing labour productivity without
putting under strain or workers. Scientific management implies the application of scientific
methods of study and analysis to the problems of management. On the basis of experiments,
he published many papers and books and all his contributions were compiled in his book
Scientific Management.
Worker
CRITICISM:
Scientific management ignored human side of organization. Taylor and his disciples
were called "Efficiency Experts" because they concentrated attention on improving
efficiency of workers and machines. Scientific management is therefore restricted in scope as
a theory of Industrial Engineering or Industrial Management, rather than a general theory of
management.
DECISION MAKING
Decision-making is an essential aspect of modern management. It is a primary
function of management. Decision-making is the key part of manager's activities. Decisions
are important as they determine both managerial and organizational actions. A decision may
be defined as "a course of action which is consciously chosen from among a set of
alternatives to achieve a desired result." It represents a well-balanced judgment and a
commitment to action.
Decision is a choice from among a set of alternatives. The word 'decision' is derived
from the Latin words de ciso which means 'a cutting away or a cutting off or in a practical
sense' to come to a conclusion. Decision-making is a process by which a decision (course of
action) is taken. Decision-making lies embedded in the process of management.
According to Trewatha & Newport, "Decision-making involves the selection of a
course of action from among two or more possible alternatives in order to arrive at a solution
for a given problem".
Implementation of Decision
2. Analyzing the Problem: After defining the problem, the next step in the decision-
making process is to analyze the problem in depth. This is necessary to classify the
problem in order to know who must take the decision and who must be informed
about the decision taken.
3. Developing Alternative Solutions: After defining the problem and analyzing its
nature, the next step is to obtain the relevant information/ data about it. Using this
data the manager has to determine available alternative courses of action that could be
used to solve the problem at hand. If necessary, group participation techniques may be
used while developing alternative solutions as depending on one solution is
undesirable.
4. Selecting the Best Solution: After preparing alternative solutions, the next step in the
decision-making process is to select an alternative that seems to be most rational for
solving the problem. The alternative thus selected must be communicated to those
who are likely to be affected by it. Acceptance of the decision by group members is
always desirable and useful for its effective implementation.
5. Implementation of Decision: After the selection of the best decision, the next step is
to convert the selected decision into an effective action. Without such action, the
decision will remain merely a declaration of good intentions. Here, the manager has to
convert 'his decision into 'their decision' through his leadership.
6. Ensuring Feedback: Feedback is the last step in the decision-making process. Here,
the manager has to make built-in arrangements to ensure feedback for continuously
testing actual developments against the expectations. It is like checking the
effectiveness of follow-up measures.
Definition:
According to Koontz and O'Donnel "It is grouping of activities necessary to attain
enterprise objectives and the assignment of each grouping to a manager with authority
necessary to supervise it".
Steps in Organizing:
Organizing involves the following interrelated steps:
1. Determination of Objectives: Organization is always related to certain objectives.
Therefore, it is essential for the management to identify the objectives before starting
any activity. It will help the management in the choice of men and materials with the
help of which it can achieve its objectives.
2. Identification and Grouping of Activities: If the members of the group are to pool
their efforts effectively, there must be proper division of the major activities. Each job
should be properly classified and grouped. This will enable the people to know what
is expected of them as members of the group.
PRINCIPLES OF ORGANISATION
Effective and efficient working of any organization depends on how the managerial
function of organization is being performed. The function of organization can be carried
effectively with the help of under mentioned principles:
1. Division of work: While structuring organization, division of work, at the very
outset, should be considered as the basis of efficiency. It is an established fact that
group of individuals can secure better results by having division of work. This is also
called the principle of specialization.
2. Attention to objectives: An organization is a mechanism to accomplish certain goals
or objectives. The objectives of an organization play an important role in determining
the type of structure which should be developed.
3. Span of Management: Span of management also refers to span of control signifying
the number of subordinates reporting directly to any executive. It is an established fact
that larger the number of subordinates reporting directly to the executive, the more
difficult it tends to be for him to supervise and coordinate them effectively.
4. Unity of Command: Organization structure should also be designed in such a way
that there exists unity of command in the sense that a single leader is the ultimate
source of authority.
5. Flexibility: While designing the organization it should be kept in mind that
organizational structure should not be regarded as static. Every organization is a
living entity in a living environment which is fast changing.
6. Proper balance: It is important to keep various segment or departments of an
organization in balance. The problem of balance basically arises when an activity or a
department is further divided and subdivided into smaller segments
7. Efficiency: The organization should be able to attain the predetermined objectives at
the minimum cost. From the point of view of an individual, a good organization
should provide the maximum work satisfaction.
8. Decentralization: This principle is of great significance to big organizations.
Decentralization implies selective dispersal of authority to help departments and units
to run effectively and efficiently without frequent interruptions from the top of the
enterprise.
9. Scalar principle: Scalar chain refers to the vertical placement of superiors starting
from the chief executive at the top through the middle level to the supervisory level at
the bottom. Proper scalar chain or line of command is prerequisite for effective
organization.
10. Continuity: The form of organization structure should be such which is able to serve
the enterprise to attain its objectives for a long period of time.
11. Coordination: The principal of coordination underlines that there should be proper
liaison and cooperation between different departments and units of work. Unity of
efforts for the accomplishment of desired objectives is the main aim of organization.
TYPES OF ORGANISATION
The organization functional structure is divided into two categories as:
1. Formal organization
2. Informal organization
Formal Organization:
A formal organization is deliberately designed to achieve some particular objectives.
It refers to the structure of well-defined jobs, each bearing a definite measure of authority,
responsibility and accountability. The structure is consciously designed to enable the
organizational members to work together for accomplishing common objectives. It tells him
to do certain things in a specified manner, to obey orders from designated individuals and to
cooperate with others. The formal organization is built around four key pillars; namely,
a. division of labor,
b. scalar and functional processes,
c. structure, and
d. span of control.
The basic characteristics of formal organization are as follows:
1. Organization structure is laid by the top management to achieve organizational goals.
2. Organization structure is based on division of labor and specialization to achieve
efficiency in operations.
3. Organization structure concentrates on the jobs to be performed and not the
individuals who are to perform jobs.
4. The organization does not take into consideration the sentiments of organizational
members.
5. The authority and responsibility relationships created by the organization structure are
to be honored by everyone.
Informal Organization:
Informal organization refers to the relationship between people in the organization
based on personal attitudes, emotions, prejudices, likes, dislikes, etc. These relations are not
developed according to procedures and regulations laid down in the formal organization
structure; generally, large formal groups give rise to small informal or social groups. These
groups may be based on same taste, language, culture or some other factor. These groups are
not preplanned, but they develop automatically within the organization according to its
environment.
The salient features of informal organization are as follows:
1. Informal relations are unplanned. They arise spontaneously.
2. Formation of informal organizations is a natural process.
3. Informal organization reflects human relationships.
4. Informal organizations are based on common taste, problem, language, religion,
culture, etc.
DEPARTMENTATION
Departmentation is a means of dividing the large functional organization into smaller,
flexible administrative units. It makes grouping of activities into units and sub-units created
through departmentation which are known as department, division, section, branch etc. The
process of departmentation takes place at all levels in the organisation. At the top level, the
breakup of functions into activities is called Primary Departmentation. Grouping activities
into separate units at the middle level is called Intermediate Departmentation and at the
lower level it is called Ultimate Departmentation or Secondary Departmentation. Let us
discuss some definitions of Departments.
Definition:
1. According to Louis Allen, Departmentation is a means of dividing the large and
monolithic functional organisation into smaller flexible administrative units.
2. According to Koontz and ODonnell, A department is a distinct area, division or
branch of an enterprise over which a manager has authority for the performance of
specified activities.
Importance of Departmentation:
The importance of departmentation is to facilitate successful operation and to create
an environment for effective performance. Grouping of activities and employees into
departments makes it possible to expand an organisation to a large extent. It enables the
organisation to recapture some of the advantages of the small functional organisation while
minimising the disadvantages of that which comes with increasing size, diversity and
dispersion.
The importance of departmentation may be stated in the following way:
1. Specification: Departmentation helps to grow specification in various activities
which leads to improving the efficiency of operation.
2. Feeling of autonomy: Departmentation gives independent charges to managers. The
feeling of independence provides satisfaction and in turn increases their
responsibilities and efficiency.
3. Fixation of responsibility: Through departmentation, responsibilities of the work can
be precisely and accurately fixed. The authority and responsibility of each department
is defined precisely.
4. Budget Preparation: It makes the preparation of budget for departments easier as
well as for the organisation as a whole easier.
5. Development of Management: The managers of each department perform
specialised functions. They take independent decision and develop themselves for
higher positions. Departmentation facilitates the development of managerial personnel
by providing them opportunities for exercising initiatives.
6. Facility in Appraisal: Since the managers perform specified jobs, their performance
appraisals become easier. Departmentation facilitates administrative control as
standards of performance are laid down separately for each department.
7. Proper Supervision: As the authority for making decisions is diffused to the
managers of the departments and works are assigned to each individual department
wise, supervision and control become easier.
Principles of Departmentation:
1. Attainment of organisational objectives: It implies that departments are designed or
created to provide all the facilities to achieve organisational objectives in an effective
and efficient manner.
2. Comprehensive departmentation: It implies that the entire functions of the
enterprise are to be covered while creating the departments.
3. Inter-departmental co-operation: It implies that departments should be designed in
such a way that maximum inter-departmental co-operation is possible.
4. Promotion of specialisation: It should help in enhancing both managerial and
operational specialisation so that organisational efficiency can be achieved.
5. Cost-benefit analysis: It should be designed and developed in a manner to get the
maximum benefit with minimum possible costs.
6. Special attention to key-result areas: Key-result areas are those areas which
determine the long term growth and survival of an organisation. It may include
profitability, market standing, public relation etc. According to this principle while
creating departments the key-result areas should be given special attention.
Methods of Departmentation:
Different methods of creating departments in an organisation are:
1. Departmentation by Function
2. Departmentation by Product
3. Departmentation by Customer
4. Departmentation by Territory
5. Departmentation by Process
Departmentation by Function:
In departmentalization by function the activities of an organisation are divided into
the primary functions to be performed i.e. manufacturing, marketing, research and
development, employee relations, and finance. This arrangement has the advantage of the
specialization and concentration of similar activities within a departmental unit. The major
problem with this form is the coordination of the specialized activities. The following chart
depicts clearly the departmentation on the basis of function:
Advantages:
The main advantages of this basis of departmentations are:
1. Benefits of specialisation.
2. Coordination among departments.
3. Simple organisation structure.
Dis-advantages:
The main disadvantages of this basis of departmentation are:
1. Isolation of the departments.
2. Lack of coordination.
3. Hindered development of individuals.
Advantages:
The main advantages of Departmention by product are:
1. Profitability of each product can be assessed.
2. Better service to consumers can be provided as the salesmen have thorough
knowledge about the product.
3. It is suitable for undertakings manufacturing varied and complex product
lines.
4. Flexibility in product lines can be attained as the addition or dropping of
product lines is easy.
5. Specilisation is made possible.
Disadvantages:
The main disadvantages of departmentation by product are:
1. Confusion in the customers mind.
2. Duplication and wastages of resources.
3. Increased costs.
Advantages:
The advantages of developmentations by customer are:
1. Specialised service to customers.
2. Supply of goods according to customers requirements.
Disadvantages:
The disadvantages of departmentation by customer are:
1. Difficulty in coordination.
2. High cost.
3. Under utilisation of human resources.
Departmentation by Territory:
Under this system the activities of the organisations are grouped into different
departments on the basis of the geographical area. For example, a company can carry out its
activities by grouping them into regions like eastern region, western region, southern region,
northern region, etc. This type of departmentation is suitable for large organisations which
are geographically spread over to different areas. The following chart depicts the territorial
departmentation:
Advantages:
The advantages of territorial departmentations are:
1. Familiarity with customers in the particular region.
2. Enjoying advantages of local situations.
3. Benefits from geographical market segmentation.
4. Training for development.
Disadvantages:
The disadvantages of territorial departmentations are:
1. Increase in costs.
2. Difficulty in coordination and control.
Advantages:
The advantages of departmentation by process are:
1. High operational efficiency.
2. Benefits of specialisation.
3. Reduction in manufacturing time and unnecessary movements in the process.
Disadvantages:
The disadvantages of departmentations by process are:
1. High Costs.
2. Requiring continuous training.
DECENTRALIZATION
An organization is said to be decentralized when managers at middle level and lower
level are given the authority to take decisions on matters relating to their functions. They are
required to take decision keeping in view the overall policies of the company.
According to Allen, "Decentralization refers to the systematic effort to delegate to the
lowest levels all authority except that which can only be exercised at central points." Thus,
decentralization means reservation of some authority (power to plan, organize, direct and
control) at the top level and delegation of authority to make decisions at points as near as
possible to where actions take place.
Advantages of Decentralization:
1. Reduction in the Burden of Chief Executive: Decentralization of authority reduces
the burden of the chief executive, as he delegates a major part of his authority to his
subordinates and this will enable him to devote more time on important functions.
2. Quick Decisions: Decentralization avoids red-tapism in making decisions as it places
responsibility for decision making as near as possible with the place where actions
take place.
3. Diversification of Activities: With the addition of new product lines, an organization
may grow complex and pose a challenge to the top executives. The challenge can be
met effectively by decentralizing the authority under the overall coordinating purview
of the top management.
LINE ORGANIZATION
It is also known as scalar or military or vertical organization and perhaps is the oldest
form. In this form of organization managers have direct responsibility for the results; line
organization can be designed in two ways:
a) Pure Line Organization: Under this form, similar activities are performed at a
particular level. Each group of activities is self contained unit and is able to perform
the assigned activities without the assistance of others.
b) Departmental Line Organization: Under this form, entire activities are divided into
different departments on the basis of similarity of activities. The basic objective of
this form is to have uniform control, authority and responsibility.
Production Manager
Suitability:
This type of organisational structure is suitable to small scale organizations where the
number of subordinates is quite small.
Advantages:
1. Simplicity: Line organization is very simple to establish and can be easily understand
by the employees.
2. Discipline: Since each position is subject to control by its immediate superior position,
often the maintenance of discipline is easy unity of command and unity of direction
foster discipline among the people in the organization.
3. Co-ordination: The hierarchy in management helps in achieving effective coordination.
4. Effective communication: There will be a direct link between superior and his
subordinate; both can communicate properly among him or herself.
5. Economical: Line organization is easy to operate and it is less expensive.
6. Unity of command: In this every person is under the command of one boss only.
7. Prompt decision: Only one person is in charge of one division or department. This
enables manager to take quick decisions.
8. Over all development of the managers: The departmental head has to look after all the
activities of his department; therefore, it encourages the development of all round
managers at the higher level of authority.
Disadvantages:
1. Ability of Manager: The success of the enterprise depends upon the caliber and
ability of few departmental heads, loss of one or two capable men may put the
organization in difficulties.
Suitability:
It can be followed in large organizations where specialization of activities is required,
because it offers ample opportunities for specialization.
Disadvantages:
1. Chances of Mis-interpretation: Although the expert advice is available, yet it reaches
the workers through line supervisors. The line officers may fail to understand the
meaning of advice and there is always a risk of misunderstanding and
misinterpretation.
2. Chances of friction: There are bound to be occasions when the line and staff may
differ in opinion may resent in conflict of interests and prevents harmonious relations
between the two.
3. Ineffective Staff in the absence of authority: The staff has no authority to execute
their own advice. Their advice is not a binding on the line officers. Therefore the
advice given by specialist may be ignored by line heads.
4. Expensive: The overhead cost of the product increases because of high salaried
specialized staff.
5. Loss of initiative by line executives: If they start depending too much on staff may
lose their initiative drive and ingenuity.
FUNCTIONAL ORGANIZATION
It is the most widely used organization structure in the medium and large scale
organizations having limited number of products. This structure emerges from the idea that
the organization must perform certain functions in order to carry on its operations.
Functional structure is created by grouping the activities on the basis of functions
required for the achievement of organizational objectives. For this purpose, all the functions
required are classified into basic, secondary and supporting functions according to their
nature & importance.
Features:
1) The whole activities of an organization are divided into various functions.
2) Each functional area is put under the charge of one executive.
3) For any decision, one has to consult the functional specialist.
Suitability:
Functional organisational structure is suitable for large scale organizations.
Line of authority
Functional authority
Advantages:
1. Separation of work: In functional organization, work has been separated from routine
work. The specialist has been given the authority and responsibility for supervision
and administration pertaining to their field of specialization unnecessary over loading
of responsibilities is thus avoided.
2. Specialization: Specialization and skilled supervisory attention is given to workers
the result is increase in rate of production and improved quality of work.
3. Ease in selection and training: Functional organization is based upon expert
knowledge. The availability of guidance through experts makes it possible to train the
workers properly in comparatively short span of time.
4. Reduction in prime cost: Since for every operation expert guidance is there, wastage
of material is reduced and thus helps to reduce prime cost.
5. Scope of growth and development of business: This type of organization presents
ample scope for the growth and development of business.
Disadvantages:
1. Indiscipline: Since the workers receive instructions from number of specialist it leads
to confusion to whom they should follow. Therefore, it is difficult to maintain
discipline
2. Shifting of responsibility: It is difficult for the top management to locate
responsibility for the unsatisfactory work everybody tries to shift responsibility on
others for the faults and failure.
3. Kills the initiative of workers: As the specialized guidance is available to the workers
the workers will not be using their talents and skills therefore their initiative cannot be
utilized.
4. Overlapping of authority: The sphere of authority tends to overlap and gives rise to
friction between the persons of equal rank.
5. Lack of co-ordination between functions: except the function in which he is
specialized he is absolutely indifferent to other functions. Therefore, there is a lack of
coordination of function and efforts.
General Manager
Project A
W W W W
Manager
Project B W
W W W
Manager
Project C
W W W W
Manager
Suitability:
It can be applicable where there is a pressure for dual focus, pressure for high
information processing, and pressure for shred resources.
Ex: Aerospace, chemicals, Banking, Brokerage, Advertising etc.
Advantages:
1. It offers operational freedom & flexibility
2. It focuses on end results.
3. It maintenance professional Identity.
4. It holds an employee responsible for management of resources.
Disadvantages:
1. It calls for greater degree of coordination,
2. It violates unity of command.
3. Difficult to define authority & responsibility.
4. Employee may be de motivated.
COMMITTEE ORGANISATION
A committee does not represent a separate type of organization like line and staff, or
functional. It is rather a device which is used as supplementary to or in addition to any of the
above types of organizations. A committee may be defined as a group of people performing
some aspects of Managerial functions. Thus, a committee is a body of persons appointed or
elected for the Consideration of specific matters brought before it.
Suitability:
It is suitable for educational organizations and universities.
Merits:
1. Pooling up of opinions.
2. It facilitates coordination.
3. It enhances communication.
4. It gives better motivation.
Demerits:
1. It is highly expensive.
2. It makes compromised decisions.
3. Lack of secrecy.
4. Domination by few members.
PROJECT ORGANIZATION
A project organization is a special case where common service like finance, purchase
etc. are organized at the functional level. But project resources are allocated to the project
manager. Since the business responsibility rests with the project manager, necessary authority
is given to him with the requisite resources. This type of organization structure helps in
making decisions for project control in terms of cost, resource and time.
Merits:
1. This calls for quick divisions.
2. Organizing all functional.
3. Proper coordination of work of different departments.
VIRTUAL ORGANIZATION
The concept of virtual organisation or corporation along with virtual team and office
has entered management field very recently. The meaning of virtual is having the efficacy
without the material part; unreal but capable of being considered as real for the purpose. It
works in a network of external alliances, using the Internet. This means while the core of the
organization can be small but still the company can operate globally is a market leader in its
niche.
Employees in a virtual organization will become emasculate and ineffective in the
absence of information and knowledge. Therefore, virtual organizations use a seamless web
of electronic communication media. The main components of this web are as follows:
1. Technology: The traditional ways of working has been transformed through new
technology.
2. E-mail integration: The whole organization can take advantage of SMS products
such as Express Way by integrating SMS into the existing e-mail infrastructure.
3. Office systems integration: SMS technology can greatly enhance the existing or new
office systems. For example, phone messages can be sent via SMS rather than
returning it in a message book.
4. Voice Mail Alert: Addition of SMS technology to the existing voice mail system
builds an effective method of receiving voice mail alerts.
5. Mobile Data: This enables a laptop to retrieve information anywhere through the
mobile phone network. In the past corporate information has been inaccessible from
many places where it is needed. One can keep connected to his/her virtual
organization from anywhere by linking laptop to mobile phone.
Disadvantages:
1. Lack of physical interactions.
2. Lack of synergies arising from face-to-face interaction.
3. Non-availability of verbal and non-verbal cues such as voice, eye movement, facial
expression and body language which make communication more effective.
Advantages:
1. It allows free flow of ideas of information or resources throughout the organisation
and others.
2. Boundary less organization is able to achieve greater integration and coordination.
3. They are able to adapt to environmental changes.
4. It is highly flexible and responsive.
5. It reduces ineffectiveness.
6. Creativity, quality, timeliness.
7. Increase in speed and flexibility.
TEAM STRUCTURE
One of the newest organizational structures developed in the 20th century is team. In
small businesses, the team structure can define the entire organization. Teams can be both
horizontal and vertical. While an organization is constituted as a set of people who synergies
individual competencies to achieve newer dimensions, the quality of organizational structure
revolves around the competencies of teams in totality.
For example, every one of the Whole Foods Market stores, the largest natural-foods grocer in
the US developing a focused strategy, is an autonomous profit centre composed of an average
of 10 self-managed teams, while team leaders in each store and each region are also a team.
Larger bureaucratic organizations can benefit from the flexibility of teams as well.
Suitable:
Xerox, Motorola, and DaimlerChrysler are all among the companies that actively use
teams to perform tasks.
Advantages:
1. Team-based organizations filter decision making down to all levels of management.
2. Team-based organizations require that all employees participate in the decision-
making process.
3. Employees feel they are part of the total organization, rather than members of an
individual department.
4. Team-based organizations run more efficiently and effectively, giving them a
competitive edge in today's global market.
Disadvantages:
1. Recognition for individual achievement within a hierarchical organization is a
motivator and a factor in determining compensation.
2. Team-based organizations value team performance over individual performance.
3. Lack of focus on the individual in team-based organizations.
4. Motivating individuals in a team-based organization can be more challenging.
5. Team-based organizations are decentralized rather than hierarchical.
Suitable:
This organisation structure is suitable for sales associates, journalism, etc.
Advantages:
1. In this structure the customers are given the first preference.
2. It becomes simple to know their preferences and plan the strategies of the
organisation accordingly.
3. Front line employees are given more responsibility and authority in the organisation
than the top management because they are closest to the customers.
4. Decentralization of authority and responsibility place a very important role in prompt
and timely decisions.
5. The inverted pyramid structure motivates the employees as they are placed in a better
position than the top management.
Disadvantages:
1. This structure may be dangerous because the role of top management is shifted to
supporting one from that of commanding one which ultimately leads to the direction
less- organisation.
2. In this structure there is absence of clear authority and responsibility levels as a result
of which people become confused and business veers out of control.
3. Frontline supervisor cannot make strategies regarding organisations even though they
have proper understanding of the customers because they are not equipped to do so.
CELLULAR ORGANISATION
A form of organization consisting of a collection of self-managing firms or cells held
together by mutual interest. A cellular organization is built on the principles of self-
organization, member ownership, and entrepreneurship. It has been replacing other systems.
In this the workers manufacture total products in teams i.e. cells.
Advantages:
1. It allows free flow of ideas of information or resources throughout the organisation
and others.
2. They are able to adapt to environmental changes.
3. It is highly flexible and responsive.
4. It reduces ineffectiveness and Increase in speed.
Disadvantages:
1. Slow response customer requirement.
2. Failure to get things to done.
3. Lack of flexibility to changing mission needs changing the world.
4. Customer has a hard time dealing with the organization.
Flat Organizations are those, which have few or even one level of management. For
example, a service organization with equal partners and 30 employees. Flat organizations are
known by their wider span of management of control. Each manager controls more number
of employees at a given point of time.
Managing Director
General Manager
Advantages:
1. It is simple to understand.
2. Easy supervision & control.
3. Quick decisions are possible.
4. It sets clearly the direct lines of authority and responsibility of a line manager.
Disadvantages:
1. Lack of specialization
2. Low Morale
3. Autocratic approach
4. Overburden to manager
IMPORTANT QUESTIONS
1. Explain the nature and functions of management?
2. Explain how scientific management paved way for changes in the traditional mindset.
3. Management is regarded as an art by some, science by others. In the light of this
statement, Explain the exact nature of management
4. What is the contribution of Henry Fayol to management thought? Explain 14
principles of management thought.
5. Write short notes on:
a. Maslow theory of Hierarchy of Human Needs
b. Frederick Herzberg two factor theory of motivation.
c. Theory X and Theory Y (Douglas Mc. Gregor)
d. Mayos Hawthorne Experiments
6. Explain the concept of Systems approach to Management with diagram?
7. What are the challenges you have to face as a manger? Discuss.
8. State the history of evolution of management thought with emphasis on modern
management techniques.
9. Is management an art or science? Justify your answer.
10. Define organization and discuss its characteristics.
11. Explain the meaning of organization and state its principles.
12. What do you mean by formal and informal organization? Evaluate its importance.
PLANT LAYOUT
Plant layout deals with the arrangement of work areas and equipment. It is related to
allocation of adequate spaces at the appropriate places for work equipment, working men,
materials, other supporting activities and also customers. The basic theme behind the
arrangement of work area is to produce the product economically, to provide the service
effectively and to provide a safe and good physical environment for the users that is, the
workers and / or the consumers.
Definition:
According to Moore, Plant layout is a plan of an optimum arrangement of facilities
including personnel, operating equipment, storage space, material handling equipment and all
other supporting services along with the design of best structure to contain all these
facilities.
Advantages:
1. Removal of obstacles in production: Product layout ensures unrestricted and
continuous production thereby minimising bottlenecks in the process of production,
this is because work stoppages are minimum under this method.
2. Economies in material handling: Under this method there are direct channels for the
flow of materials requiring lesser time which considerably eliminate back-tracking of
materials. On account of this, cost of material handling is considerably reduced. This
is greatly helpful in achieving desired quality of the end product.
3. Lesser manufacturing time: Under this method (as already pointed), backward and
forward handling of materials is not involved; it leads to considerable saving in
manufacturing time.
4. Lesser work in progress: On account of continuous uninterrupted mass production,
there is lesser accumulation of work in progress or semi-finished goods.
Dis-Advantages:
1. Lesser flexibility: As work is carried in sequence and process arranged in a line, it is
very difficult to make adjustments in production of operations. Sometimes, certain
changes under this method become very costly and impractical.
2. Large investment: Under this method, machines are not arranged in accordance with
functions as such similar type of machines and equipment is fixed at various lines of
production. This leads to unavoidable machinery duplication resulting in idle capacity
and large capital investment on the part of the entrepreneur.
3. Higher overhead charges: Higher capital investment leads to higher overheads
(fixed overheads) under this method. This leads to excessive financial burden.
4. Interruption due to breakdown: If one machine in the sequence stops on account of
breakdown, other machines cannot operate and work will be stopped. The work
stoppage may also take place on account of irregular supply of material, poor
production scheduling and employee absenteeism etc.
5. Difficulties in expanding production: Production cannot be expanded beyond
certain limits under this method.
6. Lack of specialization in supervision: Supervision of different production jobs
becomes difficult under this method as there is absence of specialized supervision as
the work is carried on in one line having different processes and not on the basis of
different departments for different specialized jobs.
7. Under-utilization of machines: As has already been pointed out, separate set of one
type of machines is fixed at different lines of production. Usually, these machines are
not properly and fully utilized and there remains idle capacity in the form of under-
utilized equipment.
Advantages:
1. Maximum utilisation of machines: This method ensures fuller and effective
utilisation of machines and consequently investment in equipment and machines
becomes economical.
2. Greater flexibility: Changes in the sequence of machines and operations can be made
without much difficulty. This is because the machines are arranged in different
departments in accordance with the nature of functions performed by them.
3. Scope for expansion: Production can be increased by installing additional machines
without much difficulty.
4. Specialisation: As has already been pointed out that under this method, specialised
machines are used for performing different production operations. This leads to
specialisation.
5. Effective utilisation of workers: Specialised workers are appointed to carry different
type of work in different departments. This leads to effective and efficient use of their
talent and capabilities.
6. More effective supervision: As the machines are arranged on the basis of functions,
performed by them, the specialised and effective supervision is ensured by the
specialised knowledge of supervisors. Each supervisor can perform his task of
supervision effectively as he has to supervise limited number machines operating in
his department.
7. Lesser work stoppages: Unlike the product method, if a machine fails, it does not
lead to complete work stoppage and production schedules are not seriously affected.
Due to breakdown in one machine, the work can be easily transferred to the other
machines.
Advantages:
1. Economies in transformation: As the work is carried at one place and material is not
taken from one place to another, this leads to savings in transformation costs.
2. Different jobs with same layout: Different projects can be undertaken with the help
of same layout.
3. Production in accordance with specifications: The jobs can be performed in
accordance with the specifications given by the customers.
4. Scope for flexibility: It provides maximum flexibility for various changes in
production processes and designs of the products.
Disadvantages:
1. Immobility of material: As material is fixed at one place, this leads to certain
difficulties in arranging specialised workers, machines and equipment for the job.
2. Large investment: This method is time consuming and costlier as compared to first
two methods.
4. COMBINATION LAYOUT:
A combination of process and product layouts combines the advantages of both
types of layouts. A combination layout is possible where an item is being made in
different types and sizes. Here machinery is arranged in a process layout but the process
grouping is then arranged in a sequence to manufacture various types and sizes of
products. It is to be noted that the sequence of operations remains same with the variety
of products and sizes. The below figure shows a combination type of layout:
WORK STUDY
Work study is a generic term for those techniques, method study and work
measurement which are used in the examination of human work in all its contexts. According
to British standard (BS 3138), work study refers to the method study and work measurement,
which are used to examine human work in all its contexts by systematically investigating into
all factors affecting its efficiency and economy to bring forth the desired improvement. The
principal aim of work study is to bring efficiency and economy by making improvements in
the method of doing the job. It is used in agricultural, manufacturing, services, transport, etc.
It has 2 parts:
METHOD STUDY
Method study enables the industrial engineer to subject each operation to systematic
analysis. The main purpose of method study is to eliminate the unnecessary operations and to
achieve the best method of performing the operation. Method study is also called methods
engineering or work design. Method engineering is used to describe collection of analysis
techniques which focus on improving the effectiveness of men and machines.
According to British Standards Institution (BS 3138), Method study is the systematic
recording and critical examination or existing and proposed ways or doing work as a means
or developing and applying easier and more effective methods and reducing cost.
Method Study
PROCEDURE
SELECT the task to be studied.
RECORD all related facts about current or proposed methods.
EXAMINE the facts critically considering the purpose,
sequence, place and resources.
DEVELOP the best possible method.
DEFINE the best possible method.
EVALUATE different alternatives to develop new method.
INSTALL the new improved method.
MAINTAIN verify the installed method.
RESULT
Increased Efficiency, Cost Effectiveness and
productivity through
a) Improved workplace layout
b) Improved equipment design
c) Reduction in worker fatigue
d) Improved product/process design
1. Select: The task or work to which the method study principles are to be applied is to be
identified and the objectives such as saving costs, increasing productivity, eliminating
unnecessary emotions by works, etc are to be specified.
2. Record: The current process of doing job has to be recorded. While doing so, every
detail, however small it may be, has to be identified. Where the process is too long,
involving many stages of production, inspection, the present process of doing the job is
recorded sufficiently, together with all the relevant information, by using the process
chart symbols.
3. Examine: This is the most important phase of method study. After an activity has been
suitably recorded by means of any method, the recorded events are to be critically
examined. The analysis may be based on primary questions like purpose, place,
sequence, person etc.
4. Develop: Based on the recorded data, the alternative methods of doing the same job
more effectively are to be identified and evaluated. From these alternatives, the best one
is selected and developed to suit the requirements.
5. Evaluate: The different alternatives to developing a new improved method comparing
the cost-effectiveness of the selected new method with the current method with the
current method of performance.
6. Install: The new method so developed is to be installed in a phased manner. As part of
installation, adequate planning of schedules and deployment of resources should be
taken care of. Once the method is adopted, the workers have to be retrained, the
equipment has to be provided, and the method has to be tested in order to seek
improvement.
7. Maintain: It should be ensured that the method is used in the manner intended.
Complaints and improvements in productivity should be registered. Once the new
method starts yielding the desired result, it is necessary to maintain the new method
without any change for some time.
WORK MEASUREMENT
Work measurement is also called by the name Time Study. Work measurement is
absolutely essential for both the planning and control of operations. Without measurement
data, we cannot determine the capacity of facilities or it is not possible to quote delivery dates
or costs. We are not in a position to determine the rate of production and also labour
utilization and efficiency. It may not be possible to introduce incentive schemes and standard
costs for budget control.
According to British Standard Institute time study has been defined as The
application of techniques designed to establish the time for a qualified worker to carry out a
specified job at a defined level of performance.
Work Measurement
PROCEDURE
DESCRIBE the given work for measurement.
BREAK the job into elements.
MEASURE the performance of operator.
DETERMINE the basic time.
PROVIDE time allowance for fatigue etc.
DETERMINE standard time.
RESULT
Increased Efficiency and
Higher productivity through
a) Scientific basis to develop incentive systems
b) Maintain reasonable levels of employment
c) Reliable means of planning and control
The essential pre-requisite to carry out work measurement is to describe the method
underlying the job. Stop watch time is the basic technique for determining accurate time
standards. They are economical for repetitive type of work. Steps in taking the time study are:
Definition:
According to Juran Quality control is the regulatory process through which we
measure actual quality performance, compare it with standards, and act on the difference.
Confidence limit:
It indicates the range of confidence level. A confidence level refers to the probability
that the value of measurement or parameter, such as length of screw, is correct.
Ex: If a component is required with measurement of 50 mm. across, then the buyer
accepts all components measuring between 48 mm and 52 mm across, considering a five
percent confidence level.
Control limit:
Control limits are found in the control charts. There are two control limits 1) Upper
control limit (UCL) and 2) Lower control limit (LCL). These are determined based on the
principles of normal distribution.
Ex: In a pilot investigation of the length of the nails produced in the shop floor, it is
found that the mean length X is cm, the S.D 3, the measure of variability of the nails
produced 0.2 cm. How do you construct the control chart for this data.
CONTROL CHARTS:
It is a technique of ensuring the quality of the products during the manufacturing
process itself. It aims to control and maintain the quality of products in manufacturing
process. It is carried out through control charts. A control chart compares graphically the
process performance data to compute statistical control limits. It is of two types:
1. Variable charts:
A variable is one whose quality measurement changes from unit to unit. The
quality of these variables is measured in terms of hardness, thickness, length, etc.
These are drawn using principles of normal distribution. It is meant for variable type
of data i.e. X-Bar chart and R charts.
X Charts:
In control charts for variables, to construct a chart, only the mean or the
average value of dimensions in the samples in plotted on it. Procedure for
construction X-Chart:
a) Compute average of averages X.
b) Calculate average of Range (R).
c) Multiply the average range by the conversion factor (A2). This gives A2R.
d) Calculate the upper control and lower control limits
Upper control limit (UCL) = X+A2R
Lower control limit (LCL) = X+A2R
Where, A2 are conversion factors from table of constants.
R Charts:
In control charts for variables, to construct a chart, only the mean or the
average value of dimensions in the samples in plotted on it. Procedure for
construction R-Chart:
a) Compute average of averages X and R for each of the samples obtained.
b) Calculate average of Range (R).
c) Multiply the average range by the conversion factor (D4 or D3).
d) Calculate the upper control and lower control limits
Upper control limit (UCL) = D4R
Lower control limit (LCL) = D4R
Where, D4 or D3 are conversion factors from table of constants.
R is average of sample ranges
2. Attribute charts:
The quality of attributes can be determined on basis of yes or no. It is one in
which it is not possible to measures the quality characteristics of a product, i.e., it is
based on visual inspection only like good or bad, success or failure, accepted or
rejected. It is meant for attribute type of data i.e. C-chart and P-chart.
C Chart:
It is used where there are a number of defects per unit. Here the sample size
should be a constant. It is used when there are several independent defects that occur
in ever unit produced. It is calculated as:
Upper control limit (UCL) = c + 3c
Lower control limit (LCL) = c + 3c
Where,
Total No. of defects in all samples
c = -------------------------------------------
Total No. of samples inspected
P Chart:
It is used where there is data about the number of defectives per sample. It is
also known as fraction defective or percentage defective chart. It is classified on go
or nogo basis i.e. good or bad defective. It is calculated as:
Upper control limit (UCL) = p + 3[ p (1 p)] / n
Lower control limit (LCL) = p + 3[ p (1 p)] / n
where,
Total No. of defectives found
average defective (p) = --------------------------------------
Total No. of pieces inspected
n = No. of pieces inspected.
Solution:
The mean of means =
Range is calculated as =
X Chart: X chart UCL and LCL compute at sample size 5 in A2 table value is 0.58
R Chart: R chart UCL and LCL compute at sample size 5 in D4 table value is 2.11
and D3 table value is 0
Solution:
3. For each of the 14 days a number of magnets used in electric relays are inspected and
the number of defectives is recorded. The total number of magnets tested is 14,000. The
following are the particular of the number of defectives found every day.
ACCEPTANCE SAMPLING
Acceptance sampling is a technique of deciding whether to accept the whole lot or not
based on the number of defectives from a random drawn sample. It is widely use in buying
food products, such as rice, wheat etc. Before buying the random samples drawn from the
bags of say rice are tested. If the quality of sample drawn looks good or free from defects
then according to the requirement the entire bag or part of it can be brought. The process of
acceptance sampling through operating characteristic curve (OCC):
It gives a clear picture about the probability of acceptance of lot for various values of
percent defectives in the lot. The probability of acceptance of a lot is high for low values of
actual percentage decrease and it is low for high values of actual percentage defectives.
Construction of OC curve:
To develop a sampling plan for acceptance sampling, an appropriate O.C curve must
be selected to construct an OC curve an agreement has to be reached between the producer
and the consumer on the following four points.
1. Acceptable quality level (AQL): This is the maximum proportion of defectives that
will make the lot definitely acceptable.
2. Lot tolerance percentage defective (LTPD): This is the maximum proportion of
defectives that will make the lot definitely unacceptable.
3. Producers risk (): This is the risk, the producer is willing to take that lots of the
quality level AQL will be rejected, even though, they are acceptable usually = 5%
4. Consumer risk (): This is the risk, the consumer is willing to take that lots of the
quality level LTPD will be accepted, even though, they are actually unacceptable
usually = 10%.
INVENTORY MANAGEMENT
An inventory is a list of items or goods. Inventory and stock control are used
interchangeably in business circle. There are various types of inventory depending upon the
context or situations. For example, inventory in a library means the list of books, journals,
periodicals, furniture, fans, etc.
A typical firm carries different kinds of inventories such as: raw materials and
purchased parts; partially completed goods called work-in-process (WIP); finished-goods or
merchandise in retail stores; replacement parts, tools, and supplies; and goods-in-transit to
warehouses or customers (called pipeline inventory).
Generally a firm has about 30 percent of its current assets and as much as 90 percent
of its working capital invested in inventory. Because inventories may represent a significant
portion of total assets, a reduction of inventories can result in a significant increase in return
on investment (ROI) - a ratio of profit after taxes to total assets.
INVENTORY CONTROL
Inventory control is a planned approach of determining what to order, when to order
and how much to order and how much to stock so that costs associated with buying and
storing are optimal without interrupting production and sales. Inventory control basically
deals with two problems:
(i) When should an order be placed? (Order level), and
(ii) How much should be ordered? (Order quantity).
These questions are answered by the use of inventory models. The scientific inventory
control system strikes the balance between the loss due to non-availability of an item and cost
of carrying the stock of an item. Scientific inventory control aims at maintaining optimum
level of stock of goods required by the company at minimum cost to the company.
2. Inventory carrying cost: Carrying cost which are also known as holding costs are the
costs incurred in maintaining the stores in the firm. They are based on average inventory.
Ex: Storage cost includes: Rent for storage facilities, Salary of person and related storage
expenses, Cost of insurance, Cost of capital.
Determining EOQ:
(a) Graphical Method:
Total cost = ordering costs + carrying costs
EOQ = quantity at which total cost is minimum
ILLUSTRATIONS
1. A biscuit manufacturing company buys lot bags of 10,000 bags wheat per annum. The
cost per bag is Rs.500 and ordering cost is Rs.400. The inventory carrying cost is
estimated at 10% of the price of the wheat. Determine EOQ and number of orders
required per year.
Solution:
Annual demand (A) = 10,000 bags
Ordering cost per order (O) = Rs.400
Carrying cost per unit (C) = 10% of Cost price
= 0.10 x 500 = Rs.50/-
In the above case, the company has to place 25 orders to optimize its ordering and
carrying costs.
If the company follows the policy of ordering every month, then the annual ordering cost is
= Rs 12 15
= Rs. 180
Hence, the company should purchase 300 parts at time interval of 1/30 year instead of
ordering 750 parts each month. The net saving of the company will be
= Rs. 1305 Rs. 900
= Rs. 405 per year.
4. The XYZ Ltd. carries a wide assortment of items for its customers. One of its popular
items has annual demand of 8000 units. Ordering cost per order is found to be Rs.12.5.
The carrying cost of average inventory is 20% per year and the cost per unit is Re. 1.00.
Determine the optimal economic quantity and make your recommendations.
Solution:
The table and the graph indicates that an order size of 1000 units will gives the
lowest total cost among the different alternatives. It also shows that minimum total
cost occurs when carrying cost is equal to ordering cost.
100
90 C
Volume of Inventory (Rs.)
70
0 10 30 100
Volume of inventory (units)
A Category:
It comprises of inventory which are costly and valuable. Normally 70% of funds are
tied up in costly stocks, which would be 10% of total volume of stock and these require strict
monitoring on a day to day basis.
B Category:
It comprises of inventory which is less costly. 20% of funds are tied up in such stocks
which are 20% of total of stocks. These require monitoring on a weekly or fortnightly basis.
C Category:
It consists of least cost inventory. 10% of funds are tied up in such stocks which are
70% of total volume. It can be monitored on a monthly or bi-monthly basis.
For effective inventory control, combination of the techniques of ABC with VED or
ABC with HML or VED with HML analysis is practically used.
Note that C type items are not necessarily unimportant; incurring a stock-out of C
items such as the nuts and bolts used to assemble manufactured goods can result in a costly
shutdown of an assembly line. However, due to the low annual dollar volume of C items,
there may not be much additional cost incurred by ordering larger quantities of some items,
or ordering them a bit earlier.
3. FSN Analysis: In this analysis, the materials are classified based on their movement
from inventory for a specified period. Items are classified on basis of their
consumption. Higher the stay of an item in the inventory, the slower would be the
movement of the material. This analysis helps to avoid investments on non-moving
items. It refers to:
F Fast moving materials.
S Slow moving materials.
N Non-moving materials.
4. SDE Analysis: This analysis is mainly used in procurement of raw materials. It states
whether the particular raw material is easy or difficult to procure. It refers to:
S Secure: Raw materials that are scarce in the manufacturing place and have
to import from other locations. Supply of this type of raw material is very less.
D Difficult: Raw materials that are available indigenously but are difficult to
procure.
E Easily available: Raw materials that are easily available to the nearby
markets and are easy to procure.
6. SOS analysis: In this analysis, the classification of existing inventory is based nature
of supply of items. They are classified as:
S - Seasonal items
OS - Off-seasonal items
1. What are the objectives of plant layout? Explain the factors influencing plant layout.
2. What do you understand by product layout? Analyse the advantage & disadvantage of
product layout.
3. What do you understand by plant layout? What is it importance and explain various
principles of Plant layout.
4. What is a fixed position layout and under what conditions do you adopt it? Explain.
5. Compare and contrast Product and Process layout.
6. What are different types of plant layout?
7. What is SQC? Explain the various techniques of SQC and throw light on their
limitations?
8. What are the objectives of work measurement? Briefly point out the methods of work
measurement?
9. What are the different types of charts and diagrams used in work study
investigations?
10. What do you mean by work study/ Explain the basic procedure involved in method
study and work measurement.
11. Name the various recording techniques used in Method Study. Give the various
symbols used in recording with their meaning?
12. What are the symbols used in process charts. How is process charts prepared?
13. What is time study? Explain its need and procedure for conducting time study.
14. What is work study? State its objectives and state the tools of work study.
15. What is Quality Control? Explain the techniques of quality control?
16. What is meant by Acceptance Sampling? Explain with graphs?
17. Graphically represent economic order quantity and explain the type of costs that go
into them.
18. Discuss the procedure of classifying inventory into A,B,C categories.
19. The demand for a product is 30000 units per annum. Cost per unit is Rs 4,
procurement cost is Rs.60 per order and carrying cost is 20% of inventory value.
Determine EOQ.
20. Define Inventory control and state objectives of inventory control and what are the
steps involved in inventory control function. Explain briefly?
21. What is meant by SQC? What is the importance is identified by the company for its
usage.
22. Explain the functions of material manager. How is the activities need coordination
with other functional areas?
23. What is meant by inventory? What is the need for inventory control at different stages
of production? What are the different costs involved in maintaining inventory?
CONCEPT OF HRM
Human Resource Management (HRM) is a relatively new approach to managing
people in any organisation. People are considered the key resource in this approach. Human
Resource Management is a process, which consists of four main activities, namely,
acquisition, development, motivation, as well as maintenance of human resources. Human
Resource Management is responsible for maintaining good human relations in the
organisation. It is also concerned with development of individuals and achieving integration
of goals of the organisation and those of the individuals.
Definition:
1. Scott, Clothier and Spriegel, Human Resource Management as that branch of
management which is responsible on a staff basis for concentrating on those aspects
of operations which are primarily concerned with the relationship of management to
employees and employees to employees and with the development of the individual
and the group.
2. Edwin B. Flippo, Human resource management is planning, organizing, directing
and controlling of the procurement, development, and resources to the end that
individual and societal objectives are accomplished.
3. Quality of life: In general, HRD has its relevance to the quality of human life
improvement. At the organizational level, it is concerned with improving the quality
of work life so as to achieve greater satisfaction of employees and higher level of
productivity.
Definition:
According to Edwin B. Flippo, Personal Management is defined as the planning,
organizing, directing and controlling of procurement, development, compensation, integration
and maintenance of people for the purpose of contributing to the organizational goals.
Features of PMIR:
1. It is concerned with managing people at all levels in the organization.
2. It is concerned with employees both at individual and group.
3. It is a method of helping the employees to identify and develop their potential.
4. It is a method to solve, intelligently and equitably, the problems of organizations
pertaining to management of HR.
5. It is required in every organization in the form of services of the personnel manager.
Functions of PMIR:
1. Recruitment and maintenance of labour force: This function includes attracting,
screening, testing, hiring and inducting men on the job.
2. Training: Training is a must to prepare the worker to meet the challenges of the new
jobs or techniques and to maintain and to improve the quality of work so that the
employees may earn more for them and contribute more to the unit.
3. Job analysis and Job description: It involves the studies of job requirements of the
enterprise and assignment of well defined functions to jobs so that qualified
employees may be hired. It forms the basis of wage determination
4. Compensation: It includes, determining wage rates, incentive systems, rating of
employees and performance standards.
5. Keeping personnel records: It includes collection of bio-data of all employees
pertaining to their work, i.e., training, job performance, aptitude, payment records etc.
6. Welfare: It includes health and safety program, sanitary facilities, recreational
facilities, educational activities etc.
2. Strategic Aspects:
In PMIR, the key issue is the labour management relation i.e., look for further
instructions at every critical stage.
In HRM, the focus is on customer, the initiatives are integrated. It makes the
decision making process faster.
3. Line Management:
In PMIR, the management role is restricted to each transaction. The initiatives
of line managers make a lot of difference and degree of standardization of any issue is
high.
In HRM, the role of leadership is more chain oriented. The communication is
direct and standardization is low. The differences between line and staff managers are
reducing.
4. Key Levels:
It offers a solution to the given problem, such as deployment of human resources,
evaluation and rewarding of performance, etc. these are the most critical and central
issues of difference between HRM and PMIR.
FUNCTIONS OF HR MANAGER
The various functions of a HR Manager are as follows:
1. Manpower Planning: Manpower planning is also known as human resource planning
(HRP). It may be defined as a rational method of accessing the requirements of
human resources at different level in an organization. It ends with proposals of
recruitment, retention or dismissal. Through planning a management strives to have
the right number and the right kinds of people at the right places, at the right time, to
do things which result in both the organisation and the individual receiving the
maximum long-range benefit.
Importance of Manpower planning:
1. It directly contributes to achieve the corporate objectives.
2. It enables to secure the right kind of quantity of human resources at different
levels.
3. It helps decision makers in search for optimum strategy.
4. It helps the line managers to highlight the existing problems in managing the
HR under their control.
5. It provides an adequate basis to take meaningful decisions.
2. Recruitment: Recruitment means search of the prospective employee to suit the job
requirements as represented by job specificationa technique of job analysis. When the
manpower plan reveals the need for additional people in organization, the manager
has to initiate the search for employees and see that they apply for jobs in the
organization. Recruitment is often called Positive function. At this stage the
applications are invited for further scrutiny and short-listing.
The sources of recruitment includes internet, executive search agencies,
employment exchanges, university and college campus, Ads in TV and Radio,
recommendation of existing employees, etc.
5. Placement: After training the employee is placed in his position under the charge of a
manager. The new recruit is allowed to exercise full authority and is held responsible
for the results. Placement involves assigning a specific job to each one of the selected
candidates. However, placement is not simple as it looks. It involves striking a fit
between the requirements of a job and the qualifications of a candidate. The
importance of placement is that it reduces employees turnover, absenteeism,
accidents and dissatisfactions.
8. Transfer: It is a lateral shift that moves an individual employee from one position to
another i.e. it may be in same department or to a different department or location. To
optimize the human resources at different locations or departments, employees are
transferred from one location to another. It is also viewed as a tool for punishing the
employee in case of misconduct or misbehavior. It does not involve any change in
salary, duties and responsibilities.
MANPOWER PLANNING
Manpower planning is also known as Human Resource Planning (HRP). Human
Resource Planning is concerned with the planning the future manpower requirements are the
organisation. Human Resource planning is the process by which a management determines
how an organisation should move from its current manpower position to its desired
manpower position. Through planning a management strives to have the right number and the
right kinds of people at the right places, at the right time, to do things which result in both the
organisation and the individual receiving the maximum long-range benefit.
Definition:
1. Coleman Human Resource Planning as the process of determining manpower
requirements and the means for meeting those requirements in order to carry out the
integrated plan of the organisation.
2. Leap and Crino HRP includes the estimation of how many qualified people are
necessary to carry out the assigned activities, how many people will be available, and
what, if anything, must be done to ensure that personnel supply equals personnel
demand at the appropriate point in the future.
Objectives of HR Planning:
The objectives of human resource planning may be summarized as below:
1. Forecasting Human Resources Requirements: HRP is essential to determine the
future needs of HR in an organization. In the absence of this plan it is very difficult to
provide the right kind of people at the right time.
2. Effective Management of Change: Proper planning is required to cope with changes
in the different aspects which affect the organization. These change needs
continuation of allocation/reallocation and effective utilization of HR in organization.
3. Realizing the Organizational Goals: In order to meet the expansion and other
organizational activities the organizational HR planning is essential.
4. Promoting Employees: HRP gives the feedback in the form of employee data which
can be used in decision-making in promotional opportunities to be made available for
the organization.
5. Effective Utilization of HR: The data base will provide the useful information in
identifying surplus and deficiency in human resources.
Management Approval
---------------------------------------------------------------------------------------------------------------
Action Plans
Sources of Recruitment
The various sources of recruitment are generally classified as:
1. Internal Sources:
This refers to the recruitment from within the company. The various internal
sources are promotion, transfer, past employees and internal advertisements.
2. External Sources:
External sources refer to the practice of getting suitable persons from outside. The
various external sources are advertisement, employment exchange, past employees,
private placement agencies and consultants, walks-ins, campus recruitment, trade unions,
etc. The following external sources of recruitment are commonly used by the big
enterprises:
1. Direct Recruitment: An important source of recruitment is direct recruitment by
placing a notice on the notice board of the enterprise specifying the details of the jobs
available. It is also known as recruitment at factory gate. It is generally followed for
filling casual vacancies requiring unskilled workers. This method of recruitment is
very cheap as it does not involve any cost of advertising vacancies.
2. Casual Callers: The organisations which are regarded as good employers draw a
steady stream of unsolicited applications in their offices. This serves as a valuable
source of manpower. If adequate attention is paid to maintain pending application
folders for various jobs, the personnel department may find the unsolicited
applications useful in filling the vacancies whenever they arise.
10. Raiding: Raiding is a technical term used when employees working elsewhere are
attracted to join organisations. The organisations are always on the lookout for
qualified professionals, and are willing to offer them a better deal if they make the
switch. There are always some employees who are professionally very competent, but
dissatisfied with something or the other in the organisation.
SELECTION
.
The process of identifying the most suitable persons for the organization is called
selection. It is also called Negative function because here applications are screened and
shortlisted on the basis of selection criteria. The main purpose is to choose right person for
right job. The selection procedure, depending upon the cadre, involves different stages. The
organizations are free to formulate their own selection procedures, as there is no standard
practice. Selection is the process of picking up individuals (out of the pool of job applicants)
with requisite qualifications and competence to fill jobs in the organization.
Definition:
Selection is the process of differentiating between applicants in order to identify and
hire those with a greater likelihood of success in a job.
Steps in Selection:
1. Preliminary Interview: The purpose of preliminary interviews is basically to
eliminate unqualified applications based on information supplied in application forms.
The basic objective is to reject misfits. On the other hands preliminary interviews is
often called a courtesy interview and is a good public relations exercise.
2. Selection Tests: Jobseekers who past the preliminary interviews are called for tests.
There are various types of tests conducted depending upon the jobs and the company.
These tests can be Aptitude Tests, Personality Tests, and Ability Tests and are
conducted to judge how well an individual can perform tasks related to the job.
Besides this there are some other tests also like Interest Tests (activity preferences),
Graphology Test (Handwriting), Medical Tests, Psychometric Tests etc.
3. Employment Interview: The next step in selection is employment interview. Here
interview is a formal and in-depth conversation between applicants acceptability. It is
considered to be an excellent selection device. Interviews can be One-to-One, Panel
Interview, or Sequential Interviews. Besides there can be Structured and Unstructured
interviews, Behavioral Interviews, Stress Interviews.
4. Reference & Background Checks: Reference checks and background checks are
conducted to verify the information provided by the candidates. Reference checks can
be through formal letters, telephone conversations. However it is merely a formality
and selections decisions are seldom affected by it.
5. Selection Decision: After obtaining all the information, the most critical step is the
selection decision is to be made. The final decision has to be made out of applicants
who have passed preliminary interviews, tests, final interviews and reference checks.
The views of line managers are considered generally because it is the line manager
who is responsible for the performance of the new employee.
6. Physical Examination: After the selection decision is made, the candidate is required
to undergo a physical fitness test. A job offer is often contingent upon the candidate
passing the physical examination.
7. Job Offer: The next step in selection process is job offer to those applicants who
have crossed all the previous hurdles. It is made by way of letter of appointment.
8. Contract of Employment: After the job offer is made and candidates accept the
offer, certain documents need to be executed by the employer and the candidate. Here
is a need to prepare a formal contract of employment, containing written contractual
terms of employment etc.
Definition:
According to Edwin B. Flippo, Training is the act of increasing the knowledge and
skills of an employee for doing a particular job.
2. Job Rotation: The major objective of job rotation training is the broadening of the
background of trainee in the organisation. If trainee is rotated periodically from one job
to another job, he acquires a general background.
3. Special Projects: This is a very flexible training device. The trainee may be asked to
perform special assignment, thereby he learns the work procedure. Sometime a task-
force is created consisting of a number of trainees representing different functions in the
organisation.
4. Apprenticeship: Under this method, the trainee is placed under a qualified supervisor
or instructor for a long period of time depending upon the job and skill required. Wages
paid to the trainee are much less than those paid to qualified workers. This type of
training is suitable in profession, trades, crafts and technical areas like fitter, turner,
electrician, welders, carpenters etc.
5. Vestibule Training: Under this method, actual work conditions are created in a class
room or a workshop. The machines, materials and tools under this method is same as
those used in actual performance in the factory. This method gives more importance to
learning process rather than production.
2. Conferences: This is also an old method, but still a favorite training method. In this
method, the participants pools, their ideas and experience in attempting to arrive at
improved methods of dealing with the problems, which are common subject of
discussion; Conferences may include buzz sessions that divide conferences into small
groups of four or five intensive discussion. These small groups then report back to the
whole conference with their conclusions or questions.
3. Case Studies: This technique, which has been developed, popularized by the Harvard
Business School, U.S.A is one of the most common form of training. A case is a written
account of a trained reporter of analyst seeking to describe an actual situation. Some
causes are merely illustrative; others are detailed and comprehensive demanding
extensive and intensive analytical ability. Cases are widely used in variety of
programmes. This method increases the trainees power of observation, helping him to
ask better questions and to look for broader range of problems.
PLACEMENT
Placement involves assigning a specific job to each one of the selected candidates.
However, placement is not simple as it looks. It involves striking a fit between the
requirements of a job and the qualifications of a candidate. The importance of placement is
that it reduces employees turnover, absenteeism, accidents and dissatisfactions.
Principles of Placement:
A few basic principles should be followed at the time of placement of a worker on the
job. This is elaborated below:
1. Man should be placed on the job according to the requirements of the job. The job
should not be adjusted according to the qualifications or requirements of the man. Job
first, man next, should be the principle of the placement.
2. The job should be offered to the person according to his qualification. This should
neither the higher nor the lower than the qualification.
3. The employee should be made conversant with the working conditions prevailing in
the organization and all things relating to the job. He should also be made aware of
the penalties if he commits the wrong.
4. While introducing the job to the new employees, an effort should be made to develop
a sense of loyalty and cooperation in him so that he may realize his responsibility
better towards the job and the organization.
5. The placement should be ready before the joining date of the newly selected person.
6. The placement in the initial period may be temporary as changes are likely after the
completion of training. The employee may be later transferred to the job where he can
do better.
Proper placement helps to improve the employees morale. The capacity of the
employees can be utilized fully. The right placement also reduces labour turnover,
absenteeism and also the accident rate.
Determinants of Compensation:
Fair and adequate compensation is critical to motivating employees attracting high-
potential employees, and retaining competent employees. Compensation has to be fair and
equitable among all workers in the same company (internal equity). Internal equity can be
achieved when pay is proportionate to the individual employees qualifications and
contributions to a company.
On the other hand, compensation also has to be fair and equitable in comparison to the
external market (external equity). If a company pays its employees below the market rate, it
may lose competent employees. In determining adequate pay for employees, a manager must
consider the three major factors: the labour market, the nature and scope of the job, and
characteristics of the individual employee. Potential employees are recruited from a certain
geographic areathe labour market.
The actual boundary of a labour market varies depending on the type of job, company,
and industry. Pay for a job even within the same labour market may vary widely because of
many factors, such as the industry, type of job, cost of living, and location of the job.
Compensation managers must be aware of these differences. To help compensation managers
understand the market rate of labour, a compensation survey is conducted.
Several factors are generally considered in evaluating the market rate of a job. They
include the cost of living of the area, union contracts, and broader economic conditions.
Urban or metropolitan areas generally have a higher cost of living than rural areas. Usually,
in calculating the real pay, a cost-of-living allowance (COLA) is added to the base wage or
salary. Cost-of-living indexes are published periodically in major business journals. The
characteristics of an individual employee are also important in determining compensation. An
individuals job qualifications, abilities and skills, prior experiences, and even willingness to
work in hardship conditions are determining factors. Within the reasonable range of a market
rate, companies offer additional compensation to attract and retain competent employees.
In principle, compensation must be designed around the job, not the person. Person-
based pay frequently results in discriminatory practices, which violates the legal
preconditions. For job-based compensation, management must conduct a systematic job
analysis, identifying and describing what is happening on the job. Each job must be carefully
examined to list the necessary tasks and actions, identify skills and abilities required, and
establish desirable behaviours for successful completion of the job.
As the market becomes more dynamic and competitive, companies are trying harder
to improve performance. Since companies cannot afford to continually increase wages by a
certain percentage, they are introducing many innovative compensation plans tied to
performance. Several of these plans are:
PROMOTION
The employees are given the promotions to higher posts and positions as and when
vacancies are available or when new posts are created at the higher levels. It is quite common
in all types of organizations. It is the product of internal mobility of the employees due to
change in organizational processes, structure etc. It is better than direct recruitment which
satisfies many human resources problems of the organization and helps in achieving
organizational objectives.
Promotion means higher position to an employee who carries higher status, more
responsibilities and higher salary. The higher status and salary is the two most important
ingredient of any promotion. It is an advancement of employee to a higher post with greater
responsibilities and higher salary, better service conditions and thus higher status.
Policy varies with organization. So the promotion is very sensitive to employees, it is
very essential. The promotion policy should clearly stated, widely circulated, and fully
explained to their employees. The promotion policy which influences the number of factor of
the organization such as, morale, motivation, turnover of the personnel in the organization.
The personnel department of the organization must develop an effective promotion policy.
The promotion policy should consider merit, potential and seniority of the employees. The
merit factor requires a good procedure for evaluating the performance of the employee.
TRANSFER
One of the internal mobility of the employee is transfer. It is lateral movement of
employee in an organization by the employee. Transfers of employees can possible from one
department to another from one plant to another. Transfer may be initiated by the
organization or by the employees with the approval of the organization. It can be also due to
changes in organizational structure or change in volume of work, it is also necessary due to
variety of reasons. But broadly can be done either to suit the conveniences of organization
and to suit the convenience of employees.
Definition:
Dale Yoder has defined transfer as A transfer involves the shifting of an employee
from one job to another without changing the responsibilities or compensation.
Types of Transfers:
Most of the transfers generally carried out four types of transfers which are discussed below:
1. Production Transfer: Such transfers are resorted to when there is a need of
manpower in one department and surplus manpower in other department. Such
transfers are made to meet the company requirements. The surplus employees in one
department/section might be observed in other place where there is a requirement.
2. Replacement Transfers: This takes place to replace a new employee who has been
in the organization for a long time and thereby giving some relief to an old employee
from the heavy pressure of work.
3. Remedial Transfers: As the name suggest, these transfers are made to rectify the
situation caused by faulty selection and placement procedures. Such transfers are
made to rectify mistakes in placement and recruitments. If the initial placement of an
individual is faulty or has not adjusted to work/job, his transfer to a more appropriate
job is desirable.
4. Versatility Transfer: Such transfers are made to increase versatility of the employees
from one job to another and one department to another department. Transfer (Job
Rotation) is the tool to train the employees. Each employee should provide a varied
and broader job experiences by moving from one department to another. This is for
preparing the employee for promotion; this will definitely help the employee to have
job enrichment.
SEPARATION
Employees separate from the campus in a variety of ways. Some separations are
voluntary and initiated by the employee, such as resignation or retirement. Others are
involuntary and initiated by management, such as lay off or medical separation. The death of
an employee or dismissal for cause creates unique challenges. Each type of separation
requires specific, different actions by you, though some processes are common to all.
Whatever the circumstances, every employee leaving the campus, whether voluntarily
or involuntarily, should feel they were treated with respect. These are:
1. Death of an Employee: When an employee dies, the surviving family members or
named beneficiaries may be eligible for certain benefits. You should report the death
immediately so notifications can be made and paperwork started. Its also important
to maintain contact with the family and offer assistance. Retirement benefits may be
due to the family and if the employee retired with a disability, additional insurance
may be due. The beneficiaries will be contacted by the offices involved.
2. Dismissal: Dismissal is the ultimate disciplinary action, normally used when other
methods employed to correct performance or behavioural problems have not been
successful. Under circumstances of extreme misconduct, dismissal without prior
warning may be warranted. Dismissal or discharge involves separating an employee
from the payroll for violation of company rules or for inadequate performances.
Which include indiscipline, insubordination and dishonesty and so constitutes the
major cause of dismissal.
3. Job Abandonment: An employee who does not report to work when expected or call
into report their absence for five consecutive days or more may be considered to have
abandoned their position, and may be subject to dismissal without prior discipline, as
noted in the dismissal.
4. Exit Interviews: Employees terminating from the campus are valuable resources.
Through hearing their feelings, concerns, and impressions, you collect data relevant to
your department and the campus. Exit interviews are used primarily for voluntary
separations. During this meeting, talk about the employees reasons for leaving, and
how the employee feels about the job and supervision. Ask for specific suggestions
the employee may have for you and the department.
8. Retirement: Majority of the separations are from retirements. Employees who have
rendered services to the organization for a number of years expect the organization to
provide for their future, when they have retired. Retirement of an employee is an
important event in his life also has an important impact on the organization, where the
employee worked for a major portion of his life. Therefore at the time of parting or
separation there must be an exit interview to know the improvements he wanted to be
introduced in the organization.
MOTIVATION
The word motivation has been derived from the latin word motive which means
any idea, need or emotion that prompts a man into action. Human motives are internalised
goals within individuals. Motivation may be defined as those forces that cause people to
behave in certain ways. Motivation encompasses all those pressures and influences that
trigger, channel, and sustain human behaviour. Most successful managers have learned to
understand the concept of human motivation and are able to use that understanding to achieve
higher standards of subordinate work performance.
Motivation is the process of channelling a person's inner drives so that he wants to
accomplish the goals of the organization. It seeks to know the incentives for work and tries to
find out the ways and means whereby their realization can be helped and encouraged.
Managers, by definition, are required to work with and through people, so they must gain at
least some understanding of the forces that will motivate the people they are to manage.
Definition:
1. Koontz and O'Donnell, "Motivation is a general term applying to the entire class of
drives, needs, wishes and similar forces".
2. Lewis Allen, "Motivation is the work a manager performs to inspire, encourage and
impel people to take required action".
Experiment Results:
After analyzing the results from the Hawthorne experiments Mayo concluded that
workers were motivated by more than self interest and the following had an impact too:
1. Psychological Contract: There is an unwritten understanding between the worker
and employer regarding what is expected from them; Mayo called this the
psychological contract.
2. Interest in Workers: A workers motivation can be increased by showing an interest
in them. Mayo classified studying the workers (through the experiments) as showing
an interest in the workers.
3. Work is a Group Activity: Work is a group activity, team work can increase a
workers motivation as it allows people to form strong working relationships and
increases trust between the workers. Work groups are created formally by the
employer but also occur informally.
4. Social Aspect of Work: Workers are motivated by the social aspect of work, as
demonstrated by the female workers socializing during and outside work and the
subsequent increase in motivation.
5. Recognize Workers: Workers are motivated by recognition, security and a sense of
belonging.
Conclusion:
The traditional view of how to motivate employees is that you offer monetary rewards
(pay increases, bonuses, etc.,) for work completion. However the Hawthorne experiments
may suggest that motivation is more complicated than that. Advocates of the "Hawthorne
Effect" will state that the Hawthorne experiment results show that motivation can be
improved through improving working relationships and social interaction.
1. Physiological needs: The Physiological needs are at the top of hierarchy because they
tend to have the highest strength until they are reasonably satisfied. It includes the
need for food, sleep, shelter, etc. these are the basic needs and if these are not
satisfied, one does not think of needs at higher level.
2. Safety or Security Needs: Once physiological needs are satisfied to a reasonable
level, the next level in the hierarchy is safety. Safety means being free of physical
danger or self-preservation. It covers protection, job security, safety of property, food
or shelter, etc.
3. Affiliation or Acceptance or Social needs: After the first two needs are satisfied,
social needs become important in the need hierarchy. Man wants to live in the society
as a member of society. He wants to love and be loved by others. It includes desire to
seek or show affection and recognition, need for companionship, identification with a
group, etc.
Conclusion:
Maslow suggest that the various levels are interdependent and overlapping, each
higher level need emerging before the lower level need has been completely satisfied.
Theory - X: This is the traditional theory of human behaviour, which makes the following
assumptions about human nature:
1. Management is responsible for organizing the elements of productive enterprises -
money, material, equipment, and people - in the interest of economic ends.
2. With reference to people it is a process of directing their efforts, motivating them,
controlling their actions, modifying their behaviour in order to be in conformity with
the needs of the organization.
3. Without this active intervention by management, people would be passive even
resistant to organizational needs. Hence they must be persuaded, rewarded, punished
and properly directed.
4. The average human being has an inherent dislike of work and will avoid it if he can.
5. He lacks ambition, dislikes responsibility and prefers to be led.
6. He is inherently self-centred, indifferent to organizational needs.
7. He is by nature resistant to change.
8. He is gullible, not very bright.
According to Theory X, people lack self While in Theory Y people are self-
motivation and require be externally directed and creative and prefer Self-
controlling and closely supervising in control.
order to get maximum output.
LEADERSHIP
Leadership is the process of influencing the behaviour of other to work willingly an
enthusiastically for achieving predetermined goals. Effective leadership is necessary for
inspiring the people to work for the accomplishment of objectives. It provides a cohesive
force which holds the group intact and develops a spirit of cooperation. Chester Bernard
viewed leadership as the quality of behavior of individuals whereby they guide people and
their activities. A leader interprets the objectives of the people working under him and guides
them towards achievement of those objectives. He also creates and sustains enthusiasm
among them for superior performance.
Leadership is the process of influencing the subordinates so that they cooperate
enthusiastically in the achievement of group goals. In other words, leadership is the process
by which an executive imaginatively directs, guides, and influences the work of others in
choosing and attaining specified goals by mediating between the individuals and the
organization in such a manner that both will obtain maximum satisfaction.
Definitions:
1. Barnard Key, Leadership is the process of influencing and supporting others to work
enthusiastically toward achieving objectives.
2. Louis A. Allen, A leader is one who guides and directs other people. He gives the
efforts of his followers a direction and purpose by influencing their behavior.
LEADERSHIP STYLES:
Leadership style refers to a leaders behavior. Behavioral pattern which the leader
reflects in his role as a leader is often described as the style of leadership. Leadership style is
the result of leaders philosophy, personality, experience, and value system. It also depends
upon the types of followers and the organizational atmosphere prevailing in the enterprise.
A B C
b) Benevolent Autocrat:
He also centralizes decision making power in him, but his motivation style is
positive. He can be effective in getting efficiency in main situations. Some like to
work under strong authority structure and they drive satisfaction by this
leadership.
c) Incompetent Autocrat:
Sometimes, superiors adopt autocratic leadership style just to hide their in
competency, because in other styles they may exposed before their subordinates.
However, this cannot be used for a long time.
Advantages:
1. It provides strong motivation and reward to manager.
2. It permits very quick decisions.
3. Less competent subordinates also have scope to work in the organisation.
Disadvantages:
1. People in the organisation dislike it specially, when it is strict and the
motivational style is negative.
2. Employees lack motivation frustration, low morale and conflict develops in the
organisation.
3. There is more dependence and less individuality in the organisation.
B
D M
Disadvantages:
1. Complex nature of organisation requires as through understanding of its problems
which lower-level employees may not be able to do.
2. Some people in the organisation want minimum interaction with their superior.
3. Some leaders may use this style as a way of avoiding responsibility.
3. Free-rein Leadership:
A free-rein leader does not lead, but leaves the group entirely to itself as shown in
the following figure. In this style, manager once determines policy, programmes, and
limitations for action and the entire process is left to subordinates group members
perform everything and the manager usually maintains contacts with outside persons to
bring the information and materials which the group needs.
M
A B
C D
A A
Advantages:
1. Positive effect on job satisfaction and moral of subordinates.
2. It gives chance to take initiative to the subordinates.
3. Maximum possible scope for development of subordinates.
Disadvantages:
1. Under this style of leadership, there is no leadership at all.
2. Subordinates do not get the guidance and support of the leader.
3. Subordinates may move in different directions and may work at cross purpose
which may create problem for the organisation.
Free rein style of leadership may be appropriate when the subordinates are well
trained, highly knowledgeable, self-motivated and ready to assume responsibility.
Objectives:
1. To establish correct wage correct wage differentials for all jobs within the factory.
2. To bring new jobs into their proper relatively with jobs previously established.
3. To help clarify lines of authority, responsibility and promotion.
4. To accomplish the foregoing by means of the facts and principles, this can be readily
explained to and accepted by all concerned.
5. To establish a general wage level for a given factory which will have parity with those
of neighboring factories.
Advantages:
1. It is simple, inexpensive and expeditions.
2. It is easily understood and easily administered.
3. It helps setting better rates based purely a judgment and experience.
4. Same unions prefer it, because it leases more room for bargaining.
Disadvantages:
1. Job may be ranked on the basis of incomplete inform action and without the benefits
of well defined standards.
2. The rank position of different jobs is likely to be influenced by prevailing wage ranks.
3. No one committee number is likely to be familiar with all the jobs.
2. Classification Method: This is also called job-grading method. Here, the number of
grades and the salary particulars for each grade are worked out first. The grades are
clearly described in terms of knowledge, skill and so on. Major steps for job
evaluation:
Deciding the number of grades
Writing grade descriptions
Identifying/listing of the jobs to be evaluated
Preparing job descriptions
2. Point-rating method: There are four widely accepted factors used in the point rating
method, skill, effort, responsibility and job conditions each of these factors is divided
into sub-factors.
Skills: It includes the rating factors such as Education and training,
Experience, Judgment and initiative.
Efforts: This factor includes Physical and Mental abilities of an individual.
Responsibility: It includes the factors like Materials or product, Equipment or
process, Safety of others, and Work of others.
Job conditions: It includes the working environment of the organisation.
MERIT RATING
Merit rating in a technique to evaluate the merits of duals according to job request
merit. The personal abilities that an individual brings to his job, measured by the extent to
which his output or quality of his work exceeds the minimum that can reasonably to expected
for his basic rate of pay.
Definition:
1. Edward Flippo, Merit rating is a systematic, periodic and, so far as humanly
possible, an impartial rating of an employees excellence in matters pertaining to his
present job to his potentialities for a job.
2. Scot, Clothier and Spriegal, Merit rating of an employee is the process of evaluating
the employees performance on the job in terms of the requirements of the job.
Beginning This process is started before the This process of Merit Rating is
appointment of an employee. started after the appointment of
employees.
Procedure of In the process of job evaluation, In the process of Merit Rating, the
Evaluation the ability, efficiency and the performance of an employee is
potentiality of an employee are evaluated by comparing it with the
evaluated. performance of another
employees of equal rank and
status.
Relation It is related with the relative study It is related with relative study of
of different jobs. different employees.
Basis of In the process of job evaluation, In the process of Merit Rating, the
Determining the remuneration of an employee remuneration of an employee is
Wages and is determined. determined on the basis of his
Salaries efficiency, ability and potentiality.
GRIEVANCE HANDLING
A grievance may be defined as any feeling of discontent or dissatisfaction, whether
expressed or not and whether valid or not, arising out of anything connected with the
company that an employee thinks, believes or even feels is unfair, unjust or inequitable.
A grievance may be:
1. Unvoiced or stated by the worker,
2. Written or unwritten, and
3. Valid or ridiculous, and may arise out of something connected with the company,
e.g., company policy or actions
Forms of Grievances
A grievance may take any one of the following forms: (a) factual, (b) imaginary, (c)
disguised.
1. Factual: A factual grievance arises when legitimate needs of employees remain
unfulfilled, e.g., wage hike has been agreed but not implemented citing various
reasons.
2. Imaginary: When an employees dissatisfaction is not because of any valid reason
but because of a wrong perception, wrong attitude or wrong information he has. Such
a situation may create an imaginary grievance. Though management is not at fault in
such instances, still it has to clear the fog immediately.
3. Disguised: An employee may have dissatisfaction for reasons that are unknown to
himself. If he/ she are under pressure from family, friends, relatives, neighbours,
he/she may reach the work spot with a heavy heart. If a new recruit gets a new table
and almirah, this may become an eyesore to other employees who have not been
treated likewise previously.
2. Accepting the Grievance: The supervisor should try to recognize and accept the
employee grievance as and when it is expressed. It must be noted that acceptance does
not necessarily mean agreeing with the grievance, it simply shows the willingness of
3. Identifying the Problem: The grievance expressed by the employee maybe at times
simply emotionally, over-toned, imaginary or vague. The supervisor, therefore, needs
to identify or diagnose the problem stated by the employee.
4. Collecting the Facts: Once the problem is identified as a real problem, the supervisor
should, then, collect all the relevant facts and proofs relating to the grievance. The
facts so collected need to be separated from the opinions and feelings to avoid
distortions of the facts. It is useful to maintain the facts for future uses as and when
these are required.
5. Analyzing the cause of the Grievance: Having collected all the facts and figures
relating to the grievance, the next step involved in the grievance procedure is to
establish and analyse the cause that led to grievance. The analysis of the cause will
involve studying various aspects of the grievance such as the employees past history,
frequency of the occurrence, management practices, union practices, etc.
6. Taking Decision: In order to take the best decision to handle the grievance,
alternative courses of actions are worked out. These are, then, evaluated in view of
their consequences on the aggrieved employee, the union and the management.
Finally, a decision is taken which is best suited to the given situation in the
organisation. Such decision should serve as a precedent both within the department
and the organisation.
In case, it is not resolved, the supervisor once again needs to go back to the whole
procedure step by step to find out an appropriate decision or solution to resolve the grievance.
However, if the grievance is not resolved at the internal level, the grievance is, then, referred
to an arbitrator who is acceptable to the employee as well as the management. The arbitrator
follows a quasi-judicial process where both the parties present evidence. Based on the
evidences so produced, the matter is cross-examined in thread-bare. The arbitrator then
thinks, applies his mind and arrives at a decision. The decision taken by arbitrator is final and
binding on both the parties.
3. STEP-3: Top management representatives and top union official discuss the
grievance, which by this time has now become issue that has political implications.
Thus it is very difficult to secure an integration of interests at this higher level.
4. STEP-4: If top management and union leaders fail to settle the issue in the fourth
step, then, is to submit the same to an impartial arbitrator for final decision as to the
action required.
5. STEP-5: A failure to settle the issue at the step-4 may result in strike, picketing,
Gherao or lockout. It is the best if the grievance gets settled at the level of supervisor
and union representative.
Definition:
1. The I.L.O. (SEA) session held at New Delhi in 1947 defined, Labour Welfare as
such services, facilities and amenities, which may be established in or in the vicinity
of, undertakings to enable persons employed therein to perform their work in healthy,
congenial surroundings and to provide them with amenities conducive to good health
and good morale.
2. N.M. Joshi defined, labour welfare covers all the efforts which employers make for
the benefit or their employees over and above the minimum standard of working
conditions fixed by Factories Act, 1948 and over and above the provision of social
legislation providing against accident, old age, unemployment and sickness.
3. The Committee on Labour Welfare (1969) defined, labour welfare to include such
services, facilities and amenities as adequate canteens, rest and recreational facilities,
sanitary and medical facilities, arrangements for travel to and from work and for the
accommodation of workers employed at a distance from their homes and such other
services, amenities, and facilities including social security measures as contribute to
improve the conditions under which workers are employed.
1. Central Government: The Central Government has passed a number of Acts for the
welfare of different types of workers. It also administers the implementation of
industrial and labour laws. The important Acts which incorporate measures for the
welfare of the workers are: Factories Act, Indian Mines Act, Employment of Children
Act, Maternity Benefits Act, Plantation Labour Act, etc. Under these Acts, employers
have to provide certain basic welfare facilities to the workers.
3. Employers: Many employers provide voluntarily welfare facilities along with the
statutory welfare facilities. These include residential lease accommodation to
employees, medical and transport facilities, reading rooms, scholarships to children of
workers, patronize teams of employees for hockey, football, etc. Employers can
provide welfare facilities individually or collectively i.e., through their associations.
Employers have to play a major role in providing welfare facilities to industrial
workers.
4. Trade Unions: Trade Unions are supposed to raise the welfare of workers and
naturally they are expected to provide certain welfare facilities to their members.
Unions can provide educational cultural another facilities to their members. Some
trade unions like the Rashtriya Mill Mazdoor Sangh are doing good work in the field
of labour welfare.
CLASSIFICATION OF WELFARE
Welfare Services related to physical and social well-being of the employees both
within and outside the organisation. Within the organisation these include provision of
medical benefits, recreational facilities, libraries, canteens, rest rooms, etc. They may also
include meals and refreshments supplied free of cost or at subsidized rates to the employees.
But outside the organisation, welfare arrangements include provision of housing
accommodation, education of children of employees, sports fields, medical facilities for the
family, etc. The welfare facilities are classified as Statutory and Non-Statutory compliance.
3. Facilitative Services: These are conveniences which the employees ordinarily require
such as:
a) Housing Facilities: Some organizations construct flats for their employees and
provide the same either free or at a nominal rent. In some cases, cash
compensations are given while in other cases, loans are advanced to the
employees to enable them to construct or purchase their own houses or flats.
b) Medical Facilities: Health is one of the foremost things for the employees and it
is but natural that there may be some injuries because of accidents while working.
So first-aid facilities must be provided for within the factory premises. In addition,
medical scheme is generally in operation under which reimbursement of medical
expenses actually incurred is allowed. The organisation may also prescribed
doctors from whom the employees may get services in case of need.
IMPORTANT QUESTIONS
1. Discuss in detail the objectives & functions of HRM.
2. Explain how job evaluation can be carried out in an industrial setup.
3. What do you understand by job evaluation? Explain in detail different methods of job
evaluation.
4. HRM in an organization is the most challenging function. Do you agree? Justify
your answer.
MARKETING MANAGEMENT
The term market originates from the Latin word Marcatus which means a place
where business is conducted. A layman regards market as a place where buyers and sellers
personally interact and finalize deals. Marketing is an essential function of a modern
organization whether it deals in products or services. Marketing is a process of identifying the
customers requirements and satisfying them efficiently and effectively. It constitutes the
eyes and ears of the business.
Marketing is the basic reason for the existence of a business organization. In the age
of fast changes, marketing is springboard of all business activities. It works as the guide for
all business/non-business organization. It is a powerful mechanism which alone can satisfy
the needs and wants of consumers at the place and price they desire. Marketing is said to be
the eyes and ears of a business organization because it keeps the business in close contact
with its economic, political, social and technological environment, and informs it of events
that can influence its activities as per requirements of the market.
Definition:
1. Philip Kotler defines, Marketing is a societal process by which individuals and
groups obtain what they need and want through creating, offering and freely exchange
products and services of value with others.
2. E.F.L. Brech defines, Marketing is the process of determining consumer demand for
a product or service, motivating its sales and distributing it into ultimate consumption
at a profit.
For a managerial definition, marketing has often been described as the art of selling
products. Marketing management takes place when at least one party to a potential exchange
thinks about the means of achieving desired responses from other parties. Marketing
management as the art and science of choosing target markets and getting, keeping, and
growing customers through creating, delivering, and communicating superior customer value.
A. Exchange functions:
1. Buying: Ensuring that product offerings are available in sufficient quantities to
meet customer demands.
2. Selling: Using advertising, personal selling and sales promotion to match goods
and services to customer needs.
B. Physical distribution functions:
1. Transporting: Moving products from their points of production to locations
convenient for purchasers.
2. Storing: Warehousing products until needed for sale.
C. Facilitating functions:
1. Standardizing and grading: Ensuring that product offerings meet established
quality and quantity control standards of size, weight and so on.
2. Financing: Providing credit for channel members or consumers.
3. Risk taking: Dealing with uncertainty about consumer purchases resulting from
creation and marketing of goods and services that consumers may purchase in the
future.
4. Securing marketing information: Collecting information about consumers,
competitors and channel members for use in marketing decision making.
MARKETING MIX
The term marketing mix was introduced by Prof. N.H. Borden of the Harward
Business School. It describes combination of the four inputs which constitute a companys
marketing system the product, the distribution system, the price structure and the promotional
activities. Marketing mix strategy is an overall marketing approach that is used to achieve
objectives of strategy marketing plans. A marketer involves several factors while dealing
with the marketing-mix strategy product lines, brands and packaging, price setting and
strategies, channel, design, selection and management and communication strategies.
Definition:
1. According to Philip Kotler, Marketing Mix is the set of controllable variables that
the firm can use to influence the buyers response.
2. According to Mr. Jerome McCarthy an American expert, Marketing mix is the pack
of four sets of variables, namely product variables, price variables, promotion
variables and place variables.
3. According to Stanton, marketing-mix is a combination of four elements product,
pricing structure, distribution system and promotional activities used to satisfy the
needs of an organizations target market and at the time achieve its marketing
objectives. Marketing mix represents a blending of decision in four areas, product,
pricing, promotion and physical distribution. These elements are interrelated because
decision in one area usually affects actions in the others.
Various elements of marketing-mix are inter related and inter dependent as shown in
the fig. below. For instance, feature of a product inefficient its price, but the price customer
can pay also determines the product features. The choice of channels is determined by the
nature of product and its price. Similarly, promotional activities add to the cost of the
product, the nature of product and its price also influence the kind of promotion to be done.
2. Price: It is one of the most difficult tasks of the marketing manager to fix the right
price. The marketing manager has to do a lot of exercise to determine the price. Price
is the value of the product or service expressed in monetary turns. From buyers point
of view, it is the cost which he is paying to marketer in order to obtain product or
service. Price has its important role in marketing. The price of the product is related
with affordable paying capacity of the consumer, the purpose and motive behind the
purchase etc.
The marketer should explore and design suitable price strategies to capture
maximum market share. Major price policies and strategies are geographical pricing,
uniform pricing, unit pricing, resale price maintenance, leader pricing, follow the
leader pricing, skim pricing, psychological pricing, price competition, non-price
competition and discount and allowances Pricing decisions and policies have direct
influence on the sales volume and profits of the firm. Price therefore is an important
element of the marketing-mix. Right price can be determined through pricing research
and by adopting test marketing techniques.
4. Place or Physical Distribution: Production has no meaning until and unless the
product is delivered to the consumers. In this regard, the marketer should select the
right distribution policy. The marketer should take into account the factors affecting
the choice of channel of distribution. Place-mix entails activities that are necessary to
transfer ownership of goods to customers and to make available goods at the right
time and place. Thus it includes decision about the channel of distribution and the
place at which the products should be displayed and made available to the customers.
The basic purpose of establishment of channel is to provide convenience in
buying to the customers so that they can purchase firms products or services without
any harassment. The important channels used for physical distribution of goods are
wholesalers and retailers. In some cases the manufacturers even own the retail outlets.
e.g., oil companies in India have their own stations distributing their petroleum
products.
5. The Fifth P: Packaging: Apart from the 4Ps which are basic to the value delivery
process of any company, packaging has assumed its importance as the 5th P of
marketing mix strategy. Packaging is the art, science and technology of preparing
goods for transport, sale and exchange. In recent times, packaging has become an
effective marketing tool. It has become a useful marketing tool because of the
growing importance of self-service, innovation in packaging industry.
The significance of packaging has increased these days because of severe
competition in the market and rise in the standard of living of the people. Packaging
facilitates the sale of a product. It acts as a silent salesman of the manufacturer,
particularly at a place where there is methods of retail selling, automatic vending and
other self-selection methods of retail selling.
3. Process: It refers to the process by which a customer is served with the desired
product. The process of delivery becomes important in a service organization. It
includes the procedures, mechanism and routines which remain within the
organization. The decisions in service process cover technology, specific equipments,
location, layout etc.
Thus, we see that marketing of services requires an expanded marketing mix
comprising the product, price, place, promotion and the people, physical evidence and
process. The marketer has to be more careful in selecting the right marketing-mix strategy in
case of marketing of services to satisfy the customer requirements.
MARKET SEGMENTATION
An organization cannot satisfy the needs and wants of all consumers. To do so may
result in a massive drain of company resources. Segmentation is simply the process of
dividing a particular market into sections, which display similar characteristics or behavior.
For a consumer product company making toiletries, India is a big market. However, all of the
one billion people dont look for the same features and buy for the same reasons. Thus to
satisfy the market company will divide the market into various sub units by identify
similarities among different group of customers.
Segmentation is the term given to the grouping of customers with similar needs by a
number of different variables. Once this has been done, segments can be targeted by a
number of targeting strategies. The stage that then follows is known as positioning which is
the place that products or services occupy in the marketplace in relation to the competition, as
perceived by the target market.
Definition:
According to Philip Kotler, Market segmentation is the sub-dividing of a market into
homogenous sub-sects of consumers where any sub-sects may conceivably be selected as a
market target to be reached, with a distinct marketing mix.
There are various definitions given by various authors thus we can define segmentation as:
A marketing technique that targets a group of customers with specific characteristics.
Dividing the heterogeneous market into the homogeneous sub-markets who share
similar needs and characteristics.
2. The second step is often termed as market mapping and involves structuring the entire
marketing procedures based upon the need of the said market. Logistics cost, retail
and whole sale cost, etc, are some important parameters that are set up during this
stage. Another very important factor involved in this step is the targeting of
consumers who are also known as decision makers. The remaining three steps are
derived on the basis of this step.
3. The third step is entirely dependent upon the consumers as the demand by consumers
and their suggestions are largely viewed, surveyed, taken into consideration and in
many cases implemented.
4. In this step, the actual segment begins to take shape as likeminded consumers having
same demands are placed together and are analyzed as a group. Launching of a
parallel or a totally new product is viewed in this situation. This segregation is often
based upon economic indexes, demographic, geographic situations.
5. The last step is catering to the needs of existing consumers and finding new markets.
This step is purely the first step towards a new 5-step-cycle that begins with finding a
new market.
One of the basic objectives of market segmentation is to maximize sales and profits.
Hence, the three important objectives of any segmentation process is to gain new customers,
sustain the existing consumers and introduce newer products into the market for the existing
consumers and thereby gain new consumers.
Demographic Segmentation:
Demos mean people and graphein means to measure or to study. In Demography
means study of people or population. In Demographic segmentation, the market is segmented
on the basis of demographic variables such as age, sex, family size, family life cycle, income,
occupation, education etc. Demographic variables or characteristics are the most popular
bases for segmenting the market.
1. Age: Age is an important factor for segmenting the market. This is because demand
and brand choice of people change with age. On the basis of age, a market can be
divided into four- Children, Teenagers, Adults and Grown-ups. For consumers of
different age groups, different types of products are produced. Johnson and Johnson
cater to the needs of children below 6 years by presenting baby powders, baby soaps,
oils etc.
Psychographic Segmentation:
It refers to grouping of people into homogeneous segments on the basis of
psychological makeup namely personality and life style.
1. Life Style: A persons life style is the pattern of living as expressed in the persons
activities, interests and opinions .They express their life styles through the products
they use. For example, the life style of a college student is different from that of an
ordinary worker. Car, clothing, cosmetics, furniture, liquor, cigarettes etc. are
segmented by using life style
2. Personality: Personality reflects a persons traits, attitude and habits. It is in this
background that a person is classified as active or passive, rational or impulsive,
creative or conventional, introvert or extrovert. For example, Raymonds
advertisement says Raymonds. The Complete Man.
3. Social Class: On the basis of Social class, consumers may be grouped into lower
class, middle class and upper class. Social class is determined by income, occupation
and education.
Behavioral Segmentation:
Behavioral segmentation is based on buyer behaviour i.e. the way people behave
during and after purchase.
1. Attitude: Customers can be segmented on the basis of attitude such as enthusiastic,
positive, indifferent, negative, hostile etc. Fashionable and latest products are used by
enthusiastic consumers. Liquor, cigarette etc are used by negative consumers.
2. Product Segmentation: The market segmentation is done on the basis of product
characteristics that are capable of satisfying certain special needs of customers.
a. Prestige products, e.g., Automobiles, clothing, Home furnishing.
b. Maturity products, e.g., Cigarettes, Blades etc.
c. Status products, e.g., most luxuries.
d. Anxiety products, e.g., Medicines, soaps etc.
e. Functional products, e.g., Fruits, vegetables etc.
3. Occasion Segmentation: According to the occasions, buyers develop a need,
purchase a product or use a product. There can be two types of situations- regular and
special. For example, for regular use, women purchase cotton or polyester sarees or
churidars. For attending marriage or reception (special occasion) they buy silk sarees.
4. Benefit Segmentation: Benefit segmentation implies satisfying one benefit group.
The benefit may be classified into Generic or Primary and Secondary or Evolved.
Product (Tooth paste) - Generic or primary utilities (Cleaning Breath fleshing),
Secondary or Evolved Utilities (brightness).
5. Volume Segmentation: The market is segmented on the basis of volume or quality of
purchase. The buyers are grouped into categories like bulk buyers, moderate buyers,
and small buyers. Heavy buyers are often small percentage of the market but account
for a high percentage of total consumption.
6. Loyalty Segmentation: Consumers have varying degree of loyality to specific
brands. On the basis of brand loyality, buyers can be divided into the following five
groups i.e., Hard-core loyals, Softcore loyals, Shifting loyals, Switchers, and
Consumer innovators.
Sales
Time
1. Introduction: This stage follows just after the launch of the product. The sales are likely
to be very slow. Most of the buyers do not come forward as the product is new and
untested.
2. Early Growth: This is the critical stage. When the usage of product starts flowing into
the market and the results are encouraging more and more buyers come forward to buy
and the unit cost relatively is high, with increased expenses, etc.
3. Rapid Growth: A new product enters the stage of rapid growth when it satisfies the need
of the customers. The sales will increase with repeat purchases and also by mouth
publicity and promotion by manufacturer.
4. Maturity: When the sales growth slows down, it is called maturity stage. At this stage,
the firms tend to attract the customers away from their competitors through cheaper prices
and larger promotional efforts and outlay.
5. Saturation: When the sales slows down to zero. The size of market does not increase
beyond this stage i.e. a new customer is replaced by the old customer who has stopped
buying the product.
6. Decline: When the sales of the product tend to fall. When they do not satisfy the
customer, it is no more preferred. As a result its competing products offering superior
benefits take over the market.
Definition:
According to Stanton, A distribution channel consists of the set of people and firms
involved in the transfer of title to a product as the product moves from producer to ultimate
consumer or business user.
CONSUMER BEHAVIOUR
Behaviour is the interaction with the ambient surrounding environment, inherent in
living creatures and mediated by their external and inner activeness. Thus consumer
behaviour is actions of consumers in the market place and the underlying motives for those
actions. Marketers expect that by understanding what causes consumers to buy particular
goods and services, they will be able to determine which products are needed in the market
place, which are obsolete and how best to present those goods to the consumer.
The study of consumer behaviour is the study of how individuals make decisions to
spend their available resources (time, money, effort) on consumption related items.
Definition:
In the words of Walters and Paul consumer behaviour is the process whereby
individuals decide what, when, where, how and from whom to purchase goods and services.
Social Factors:
The major social factors are as follows:
1. Reference Group: consumer behaviour is influenced by various groups within
society known as reference groups. We have several reference groups with whom an
individual associate such as friends, relatives, classmates, club memberships etc. In
each groups there is an opinion leader whose style is adopted by others. Marketers
often identify such opinion leaders and develop advertisement featuring them as
endorsers.
2. Role and Status: A person takes up many roles in different situations in his /her life.
He can be son, father, husband, employee etc. Each role has a status. A persons role
and status influence his general as well as buying behaviour.
3. Family: Family is one of the important factors influencing buying behaviour.
Cultural Factors:
Culture determines and regulates our general behaviour. The major cultural factors are
as follows:
1. Culture: Culture simply refers to values and beliefs in which one is born and brought
up. It is a set of Ideas, Customs, Values, Art and Belief that are produced or shaped by
a society and passed on from generation to generation. Culture influence what we eat
and wear, how we relax and where we live etc.
2. Sub-Culture: It is based on religion, language, geographic region, nationality, age
etc. It is a segment within a large culture that shares a set of beliefs, values or
activities that differ in certain respects from those of the main or overall culture. The
food habits are different in different parts of India.
3. Social Class: A social class is a group of people with similar values, interest and
behaviour within a society. Consumers buying behaviour is determined by the social
class to which they belong rather than by their income alone. The social class is based
on income, education, occupation, family history, wealth, lifestyle, area of residence
etc.
Personal Factors:
Personal factors are unique to a particular person. These factors include demographic
factors and are as follows:
1. Age: Need and wants are determined by age. So buying changes with age, Taste for
food, clothing and recreation etc. changes with age.
2. Stages in the Life Cycle: People buy different goods during different life cycle
stages. Life cycle of an individual refers to the different phases of his or her life.
3. Occupation and Economic Status: Occupation influences product choice, brands
beliefs etc. It determines income, buying power and status.
Economic Factors:
The various economic factors which determine consumer behaviour are as follows:
1. Personal Income: Gross income of a person is composed of disposable and
discretionary income. When disposable income rises, the expenditure on various items
will increase and vice versa.
2. Family Income: It is the aggregate income of all members of a family. The family
income remaining after the expenditure on the basic needs of the family is made
available for buying goods, durables and luxuries
3. Income Expectations: If a person expects any increase in his income he will buy
durables on hire purchase etc, if his future income is likely to decline he will restrict
his expenditure to bare necessities.
4. Savings: When a person decides to save more, he will spend less on comfort and
luxuries.
5. Liquidity Position: If an individual has more liquid assets, he goes in for buying
comfort and luxuries.
6. Consumer Credit: If Consumer Credit is available on liberal terms, expenditure on
comfort and luxuries will increase.
Environmental Factors:
The various environmental factors which determine consumer behaviour are as follows:
1. Political Situation: In state monopolies, consumers have to be satisfied with a limited
range of products, but in market oriented economy like that of USA, consumers have
wider choice.
2. Legal Forces: Consumers make purchases within the legal framework. All purchase
dealings are carried on within legal limits.
3. Technological Advancements: Technological advancements bring wide range of
changes in products/ services and makes consumers go in for latest products.
4. Ethical Considerations: Buying behaviour is influenced by the sense of social
morality and ethical considerations.
1. Problem Recognition or Need Arousal: Consumer buying process starts with need
arousal. Need gets aroused when consumers feel that there is a difference between his
actual and desired state. A need can be activated through internal or external stimuli.
a) Internal Stimuli: Due to his biogenic conditions when person feels hungry,
thirsty, desire for sex, the need gets aroused which creates tension to person and it
becomes a drive, the person know how to cope with such drive from his previous
experience and is motivated to buy a product which satisfy his desire.
b) External Stimuli: Persons need gets aroused by external stimulus, for example a
woman has seen the advertisement of ornaments or person passing near
restaurants may have look at fresh foods which increase his appetite (hunger) and
he decides to buy a food.
2. Information Search: If an aroused need is intense and product is affordable and easily
available consumer buys it and satisfies his need, for example hungry person sees a food,
buys it and consumes it immediately. In more cases need is not intense or product is not
easily available, it enters consumers memory and will be satisfied in future. Depending
upon the intensity of need, the need produces two types of behaviour:
MARKETING RESEARCH
A marketing research starts with an information need. It ends with an actionable
report or presentation or both. In between there are various steps to ensure that the marketing
research report achieves what we set out to do. The marketing research process includes the
systematic identification, collection, analysis and distribution of information for the purpose
of knowledge development and decision-making. The reasons and times at which any
company or organization might consider performing marketing research varies, but the
general purpose of gaining intelligence for decision-making remains constant throughout. As
a company or organization, the overwhelming majority of researches are currently
considering what likely revolves around the customer.
Definition:
1. American Marketing Association defines, Marketing Research is the function which
links the consumer, customer, and public to the marketer through information-
information used to identify and define marketing opportunities and problems;
generate, refine, and evaluate marketing actions; monitor marketing performance; and
improve understanding of marketing as a process.
2. Green and Tull defined, Marketing research is the systematic and objective search
for, and analysis of, information relevant to the identification and solution of any
problem in the field of marketing.
Follow-up:
A researcher should follow-up their studies to determine whether their results and
recommendations are being used. Without a follow-up, the researcher has no way of knowing
if the research has met the managements requirements. If it has fallen short of managerial
requirement, this is a step that can help in improving future research projects.
NETWORK ANALYSIS
It refers to a number of techniques for planning and control of complex projects. The
basis of network planning is the representation of sequential relationships between activities
by means of network of lines and circles. The idea is to link various activities in such a way
that the overall time spent on the project is kept to a minimum.
The advantages of developing a network are:
1. They provide logical picture of the layout and sequence of a project.
2. They help to identify the activities and events of the project.
3. They provide basis for working out times, costs involved in project.
4. They act as a focus point for action and coordination.
5. They make an enormous contribution to planning of projects.
2. Critical Path Method (CPM): It is a commonly used for those projects which are
repetitive in nature & where one has prior experience of handling similar projects. It
is a deterministic model & places emphasis on time & cost for activities of a project.
Preceedor Successor
Event Event
3. Dummy Event: This is an activity drawn to show clear and logical dependencies
between activities so as not to violate the rules of drawing networks. It does not
consume resources. Dummy activity is a hypothetical activity which takes no
resource or time to complete. It is represented by broken arrowed line & is used for
either distinguishing activities having common starting & finishing events or to
identify & maintain proper precedence relationship between activities that are not
connected by events.
It is represented by dotted arrow ( ).
NETWORK:
This is the combination of activities, dummy activities and events in a logical
sequence, according to the rules of drawing a network. Each activity of the project is
represented by arrow pointing in direction of progress of project. The events of the network
establish the precedence relationship among different activities.
The rules of drawing a network:
1. A complete network should have only one point of start and only point of end event.
2. Each activity must have one preceding or tail event and one succeeding or head event.
3. An event is not complete until all activities are complete.
4. All activities must be tied into the network. Events left untied to network are called
danglers.
5. Arrows cannot go backward and loop network should be avoided.
6. An arrow should always be straight, not curved, head from left to right and do not
cross each other.
7. Use dummies only when it is required.
2. Pessimistic Time Estimate (tp): This is the maximum possible time it could take to
complete the job barring the major disturbances like labour strike, etc.
3. Most-Likely time Estimate (tm or ti): It is the time estimate which likes between the
optimistic and pessimistic time estimates.
4. Average Time Estimate (te): according to beta distribution, the average of the 3
estimates is equal to the aggregate of one-sixth of optimistic, two-thirds of most likely
and one-sixth of pessimistic time estimates. This equation is very significant in PERT
analysis:
te = 1/6 to + 2/3 tm + 1/6 tp
or
te = to +4tm + tp / 6
5. Range, Standard Deviation and Variance: In beta distribution, the range is equal to
the difference between pessimistic time estimate (tp) and optimistic time estimate (to).
Range = tp - to
Standard Deviation () is equal to one-sixth of range.
= (tp- to) / 6
Variance (2) = [(tp- to) / 6]2
3. It is a technique for evaluating the Here time estimates are based on past
probability of completing the project. data.
1. Earliest Expected Time (TE): (Forward pass time): It refers to the time when an
event can be expected to be completed at the earliest. It is computed by adding t es of
the activity path leading to that event. It is started with the start event and worked out
for all events. Where there is more than one path leading to a particular event,
consider the maximum value of the TEs.
TE (Successor Event) = maximum value of [TE (preceedor event) + te (activity)]
3. Critical Path: Critical path is that path which consumes the maximum amount of
time or resources. It is that path which has zero slack value.
(TL TE)
4. Slack: Slack means the time taken to delay a particular event without affecting the
project completion time. If a path has zero slack that means it is the critical path.
Slack = LFT EFT
5. Earliest Start Time (EST): It is the earliest possible time at which an activity can
start, and is calculated by moving from first to last event in the network diagram.
6. Earliest Finish Time (EFT): It is the earliest possible time at which an activity can
be finished.
EFT = EST + Duration of activity
7. Latest Start Time (LST): It is the latest possible time by which an activity can start
without delaying the date of completion of the project.
LST = LFT Duration of the activity
8. Latest Finish Time (LFT): It is the latest time by which the activity must be
completed. So that the scheduled date for the completion of the project may not be
delayed. It is calculated by moving backwards.
FLOAT
Floats in the network analysis represent the difference between the maximum
time available to finish the activity and the time required to complete it. The basic difference
between slack and float times is a slack is used with reference to event, float is use with
reference to activity.
Floats are three types:
1. Total float: It is the additional time which a non critical activity can consume
without increasing the project duration. However total float may affect the floats in
previous and subsequent activities.
Total float = LST EST or LFT EFT
2. Free float: Free float refers to the time by which an activity can expand
without affecting succeeding activities.
Free float = EST of Head Event EST of Trail Event Activity duration
3. Independent float: This the time by which activity may be delayed or extended
without affecting the preceding or succeeding activities in any away.
Independent float = EST of Head event LFT of Trail event Activity duration
PROJECT CRASHING
In project crashing, the starting point is the critical path. Once the critical path in a
network is identified, it is necessary to identify the crash activities by calculating cost slope.
The network diagram should be reconstructed at every stage of crashing incorporating the
effect of crashing in the selected sequence.
For reducing the duration, extra expenditure is required to be incurred, but to save
resources; organizations keep this extra expenditure at a minimum. As such, the decision to
crash or expedite should be taken for only those activities which would involve minimum
extra cost.
Y
Total Cost (A + B)
0
0 CT OT NT X
Project Time Duration
Where, CT = Crash time
OT = Optimum time
NT = Normal time
From the above graph, it can be observed that direct cost (A) decrease with an
increase in time. As the project duration increases, the indirect cost (B) increases. The total
cost (A+B) curve is flat U-shaped, which implies that only up to a particular point (0) the
2. Indirect costs: The cost those are determined per day. These are directly proportional
to the number of days of the duration of the project. Ex: Rent, interest on borrowings,
advertisement, bonus to staff, etc.
3. Normal costs: The costs that is incurred if the project allowed taking its normal
duration of time, considering the most efficient utilization of the resources.
4. Crash costs: The cost incurred to reduce activity duration to its minimum. Ex: extra
wages, over time, etc.
The total project cost is the sum of the direct & the indirect costs.
Optimum duration is the project duration at which total project cost is lowest.
Activity: 1-2 1-3 2-3 2-5 3-4 3-6 4-5 4-6 5-6 6-
Duration 15 15 3 5 8 12 1 14 3 14
7
:
(Weeks)
Solution:
Network Diagram:
Critical Path = 1 2 3 4 9 7
Project Duration = 54 weeks
Activity A B C D E F
Preceding - A B A D C,E
Activity
Duration 4 6 5 4 3 3
Solution:
Network Diagram:
3. A small engineering project consists of six activities. The three time estimates in number
days for each activity are given below.
Activity to tm tp
12 2 5 8
23 1 1 1
35 0 6 18
56 7 7 7
14 3 3 3
45 2 8 14
Find out:
a) Calculate the values of expected time (te), SD, variance of each activity
b) Draw the network diagram and calculate total slack for each activity
c) Identify the critical path and mark on the net work diagram
d) Probability of completing project in 25 days
Solution:
Here, ts = 25 days
te = 20 days
= 1 + 0 + 9 + 0 = 10
25 20
=
1+0+9+0
5
=
10
= 1.50
From the table value (z = 1.50) = 93.32%
Solution:
5. The following table gives the information relating to a project. By using the given data
calculate the optimum duration of the project. Where indirect cost is estimated Rs.2,000
per day.
Solution:
All activities comes under the critical activities, the priority are changed according to
the cost slope 4-5 activity having minimum cost slope. So, that it is possible to crash out 4-5
activity by one day only and 2-5 by one day simultaneously.
This network diagram not possible to crashing further, So that the project duration is 6
days and optimum cost is Rs.22,000/-
Optimum cost = Rs.22,000/-
Optimum Duration = 6 days
IMPORTANT QUESTIONS
1. Explain PERT & CPM. How will you analyze a Project?
2. Explain and illustrate what you understand by network analysis.
3. What do you mean by crashing a network? State step by step procedure of crashing.
4. What is CPM? What are the essential steps in CPM for project planning?
5. Explain PERT. What are the requirements for application of PERT technique?
6. Briefly write a note on PERT and its time estimate. How do you calculate the
expected time to complete the activity in PERT technique?
7. Write a short note on the following:
a. Critical Path
b. EST, EFT, LST, LFT
c. Float vs Slack
d. Expected Time
e. Cost Slope
3. The following details are available regarding a project. Determine the critical path, the
critical activities and the project completion time.
Activity Predecessor Activity Duration
A - 3
B A 5
C A 7
D B 10
E C 8
F D,E 4
6. A project consists of seven activities for which relevant data are given below:
(i) Draw the network, (ii) Name and highlight the critical path.
Activity Preceding activity Activity duration (days)
A - 4
B - 7
C - 6
D A, B 5
E A, B 7
F C, D, E 5
G C, D, E 4
7. From the following information draw the network and identify the critical path and
project duration.
8. The following table gives the schedule of welding activities in an assembly shop. Find
the critical path and determine the slack times for each activity.
Activity No. Duration (days) Activity No. Duration (days)
0-1 2 0-6 1
1-2 4 3-7 8
2-3 2 6-7 3
3-4 5 5-8 3
2-5 1 7-8 5
4-5 1
10. A project consists of the following activities and different time estimates (in days). Draw
a network and find the critical path. What is the probability that the project will be
completed by 27 days?
Activity Optimistic time Most likely time Pessimistic time
1-2 3 6 15
1-3 2 5 14
1-4 6 12 30
2-5 2 5 8
2-6 5 11 17
3-6 3 6 15
4-7 3 9 27
5-7 1 4 7
6-7 2 5 8
11. A project is composed of seven activities whose time estimates are listed in
the following table. Activities are identified by their beginning i and ending j
mode numbers:
Activity Estimated duration (weeks)
i j optimistic Most likely pessimistic
1 2 1 1 7
1 3 1 4 7
1 4 2 2 8
2 5 1 1 1
3 5 2 5 14
4 6 2 5 0
5 6 3 5 15
(i) Draw the project network and identify all paths for its completion
(ii) Find the expected duration and variance of the project
(iii) Calculate the early and late occurrence time for each mode. Calculate
expected project length
(iv) Calculate the slack of each activity
13. Find out the time required to complete the following project and the critical activities:
14. Find out the time, variance and standard deviation of the project with the following
time estimates in weeks:
16. Draw the network diagram for the following project. Determine the time, variance and
standard deviation of the project.
17. Consider the following project with the estimates of time in weeks:
20. An Engineering Project has the following activities, whose time estimates are listed:
Activity Estimated Duration (in months)
(i-j) Optimistic Most Likely Pessimistic
1-2 2 2 14
1-3 2 8 14
1-4 4 4 16
2-5 2 2 2
3-5 4 10 28
4-6 4 10 16
5-6 6 12 30
Draw the project network and find the critical path.
Find the expected duration and variance for each activity. What is the
expected project length?
Calculate the variance and standard deviation of the project length.
What is the probability that the project will be completed at least eight months
earlier than expected time?
If the project due date is 38 months, what is the probability of not meeting the
due date? Given:
z 0.50 0.67 1.00 1.33 2.00
P 0.3085 0.2514 0.1587 0.0918 0.0228
21. From the following data crash the network and identity the optimum time of the project
where the indirect cost is estimated Rs.2000 per day.
23. A project has activities with the following normal and crash times and cost.
Determine a crashing scheme for the above project so that the total project time is
reduced by 3 weeks.
26. The following table gives data on normal time and cost and crash time and cost for a
project. Indirect costs are Rs. 50 per week.
Draw the network and identify the critical path.
What is the normal project duration and associated cost?
Find out total float for each activity.
Crash the relevant activities systematically and determine the optimum project
time and cost.
Activity NT (Week) NC (Rs.) CT (Week) CC (Rs.)
1-2 3 300 2 400
2-3 3 30 3 30
2-4 7 420 5 580
2-5 9 720 7 810
3-5 5 250 4 300
4-5 0 0 0 0
5-6 6 320 4 410
6-7 4 400 3 470
6-8 13 780 10 900
7-8 10 1000 9 1200
27. A small project is having seven activities. The relevant data about these activities is
given below.
(i) Find out the normal duration and the minimum duration.
(ii) What is the percentage increase in cost to complete the project in 21 days?
Activity Dependence NT CT NC CC
(Days) (Days) (Rs.) (Rs.)
A - 7 5 500 900
B A 4 2 400 60000
C A 5 5 500 500
D A 6 4 800 1000
E B,C 7 4 700 1000
F C,D 5 2 800 1400
G E,F 6 4 800 1600
z 0.00 0.01 0.02 0.03 0.04 0.05 0.06 0.07 0.08 0.09
0.0 0.0000 0.0040 0.0080 0.0120 0.0160 0.0199 0.0239 0.0279 0.0319 0.0359
0.1 0.0398 0.0438 0.0478 0.0517 0.0557 0.0596 0.0636 0.0675 0.0714 0.0753
0.2 0.0793 0.0832 0.0871 0.0910 0.0948 0.0987 0.1026 0.1064 0.1103 0.1141
0.3 0.1179 0.1217 0.1255 0.1293 0.1331 0.1368 0.1406 0.1443 0.1480 0.1517
0.4 0.1554 0.1591 0.1628 0.1664 0.1700 0.1736 0.1772 0.1808 0.1844 0.1879
0.5 0.1915 0.1950 0.1985 0.2019 0.2054 0.2088 0.2123 0.2157 0.2190 0.2224
0.6 0.2257 0.2291 0.2324 0.2357 0.2389 0.2422 0.2454 0.2486 0.2517 0.2549
0.7 0.2580 0.2611 0.2642 0.2673 0.2704 0.2734 0.2764 0.2794 0.2823 0.2852
0.8 0.2881 0.2910 0.2939 0.2967 0.2995 0.3023 0.3051 0.3078 0.3106 0.3133
0.9 0.3159 0.3186 0.3212 0.3238 0.3264 0.3289 0.3315 0.3304 0.3365 0.3389
1.0 0.3413 0.3438 0.3461 0.3485 0.3508 0.3531 0.3554 0.3577 0.3599 0.3621
1.1 0.3643 0.3665 0.3686 0.3708 0.3729 0.3749 0.3770 0.3790 0.3810 0.3830
1.2 0.3849 0.3869 0.3888 0.3907 0.3925 0.3944 0.3962 0.3980 0.3997 0.4015
1.3 0.4032 0.4049 0.4066 0.4082 0.4099 0.4115 0.4131 0.4147 0.4162 0.4177
1.4 0.4192 0.4207 0.4222 0.4236 0.4251 0.4265 0.4279 0.4292 0.4306 0.4319
1.5 0.4332 0.4345 0.4357 0.4370 0.4382 0.4394 0.4406 0.4418 0.4429 0.4441
1.6 0.4452 0.4463 0.4474 0.4484 0.4495 0.4505 0.4515 0.4525 0.4535 0.4545
1.7 0.4554 0.4564 0.4573 0.4582 0.4591 0.4599 0.4608 0.4616 0.4625 0.4633
1.8 0.4641 0.4649 0.4656 0.4664 0.4671 0.4678 0.4686 0.4693 0.4699 0.4706
1.9 0.4713 0.4719 0.4726 0.4732 0.4738 0.4744 0.4750 0.4756 0.4761 0.4767
2.0 0.4772 0.4778 0.4783 0.4788 0.4793 0.4798 0.4803 0.4808 0.4812 0.4817
2.1 0.4821 0.4826 0.4830 0.4834 0.4838 0.4842 0.4846 0.4850 0.4854 0.4857
2.2 0.4861 0.4864 0.4868 0.4871 0.4875 0.4878 0.4881 0.4884 0.4887 0.4890
2.3 0.4893 0.4896 0.4898 0.4901 0.4904 0.4906 0.4909 0.4911 0.4913 0.4916
2.4 0.4918 0.4920 0.4922 0.4925 0.4927 0.4929 0.4931 0.4932 0.4934 0.4936
2.5 0.4938 0.4940 0.4941 0.4943 0.4945 0.4946 0.4948 0.4949 0.4951 0.4952
2.6 0.4953 0.4955 0.4956 0.4957 0.4959 0.4960 0.4961 0.4962 0.4963 0.4964
2.7 0.4965 0.4966 0.4967 0.4968 0.4969 0.4970 0.4971 0.4972 0.4973 0.4974
2.8 0.4974 0.4975 0.4976 0.4977 0.4977 0.4978 0.4979 0.4979 0.4980 0.4981
2.9 0.4981 0.4982 0.4982 0.4983 0.4984 0.4984 0.4985 0.4985 0.4986 0.4986
3.0 0.4987 0.4987 0.4987 0.4988 0.4988 0.4989 0.4989 0.4989 0.4990 0.4990
3.1 0.4990 0.4991 0.4991 0.4991 0.4992 0.4992 0.4992 0.4992 0.4993 0.4993
3.2 0.4993 0.4993 0.4994 0.4994 0.4994 0.4994 0.4994 0.4995 0.4995 0.4995
3.3 0.4995 0.4995 0.4995 0.4996 0.4996 0.4996 0.4996 0.4996 0.4996 0.4997
3.4 0.4997 0.4997 0.4997 0.4997 0.4997 0.4997 0.4997 0.4997 0.4997 0.4998
3.5 0.4998 0.4998 0.4998 0.4998 0.4998 0.4998 0.4998 0.4998 0.4998 0.4998
3.6 0.4998 0.4998 0.4999 0.4999 0.4999 0.4999 0.4999 0.4999 0.4999 0.4999
3.7 0.4999 0.4999 0.4999 0.4999 0.4999 0.4999 0.4999 0.4999 0.4999 0.4999