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Examination Paper
IIBM Institute of Business Management 1
IIBM Institute of Business Management
Examination Paper MM.50
Corporate Governance
Section A: OBJECTIVE TYPE (20 marks)
This section consists of Multiple choice questions.
Answer all the questions.
Questions carry 1 mark each.
1. In the second version of McKinsey’s model called “the Central model” governance chain is
represented by

a. Well-developed equity market & dispersed ownership
b. Underdeveloped equity market & concentrated ownership
c. Well-developed equity market & concentrated ownership
d. Underdeveloped equity market & dispersed ownership
2. Corporate governance refers to a combination of law, rules, regulations and
a. Value
b. Wealth
c. Voluntary practices
d. Customer Satisfaction
3. ____________, is one of the major tools. Corporations use to direct persuasive communication to
target buyers & the public.
a. Advertising
b. Media
c. Press
d. None
4. Policy adopted by the monetary authority with respect to the supply of money is called
a. Monetary Policy
b. Fiscal Policy
c. Budgetary Policy
d. Economic Policy
5. Cash reserve requirements refer to the
a. Purchase & Sale of government securities & other approved securities by the Central bank.
b. Changes in bank rate by the Central Bank
c. That portion of bank’s total cash reserves which they are statutorily required to hold with the
RBI.
Examination Paper
IIBM Institute of Business Management 2
d. The particular level of liquid ity maintained by commercial banks.
6. This committee was set up in January 1995 to identify good practices by the confederation of
British Industry (CBI)
a. The Paul Ruthman Committee
b. The Greenbury Committee, 1995
c. Cadbury Committee, 1995
d. The Hampel Committee,1995
7. ______________, plays a significant role in the growth of the corporate sector by providing them
finance for their Operations.
a. Investors
b. Bank
c. Organization
d. None
8. The first stock market scam was one which involved both the bond and equity markets in India.
a. MNC’s efforts at Consolidation of ownership, 1993
b. Vanishing Companies Scam, 1993-94
c. M. S. Shoes, 1994
d. Harshad Mehta scam, 1992
9. Debt purchasers provide finance in return for a promised stream of payments & a variety of other
convenants pertaining to corporate behavior, such as the value and risk of corporate assets. These
are called
a. Concentrated Debt
b. Diffused Debt
c. Creditor Incentives
d. Debt Collection
10. A person having control over the direction, conduct, management or superintendence of then
affairs of a company is called
a. Director
b. Co- director
c. Board members
d. None
11. A director who is not duly appointed but acts as a director is known as a
a. Fraudulent Person
b. De Facto
c. De Jure
d. None
12. This type of auditors are usually referred to as a CPA (Certified Public Accountants) firms
Examination Paper
IIBM Institute of Business Management 3
a. Internal auditors
b. Independent auditors
c. Government auditors
d. None
13. To introduce corporate governance practices in the banking sector the recommendations of the
working group of directors of financial Institutions known as the
a. Ganguly Group
b. Policy Implication
c. Government Control
d. Withdrawal effects
14. It is a manipulative method where one buy the power or the influence of others persons in order
to satisfy his selfish need.
a. Coercion
b. Tax Evasion
c. Bribery
d. Insider Trading
15. This model supports the idea of multiple interests of stakeholders rather than shareholders interest
alone
a. The Social Entity Theory
b. Trusteeship Model
c. The Pluralistic Model
d. Social Responsibility
16. This policy was released in August by the Ministry of Environment & Forests (MOEF) for
Public discussion
a. The National Environment Policy, 2004
b. Draft Policy
c. Biodiversity Conservation
d. Forest & wildlife Conservation
17. Out of the following which Committee appointed to examine all current Capital market
regulations & to suggest amendments to them
a. SEBI
b. Dhanuka Committee
c. Primary Market Reforms
d. None
18. Out of the following which one sentence is the true
a. It lays down the framework for creating long-term trust between companies & the external
provides of capital
b. It rationalizes the management and monitoring of risks a firm faces globally
Examination Paper
IIBM Institute of Business Management 4
c. It does not limits the liability of the top management 7 directors by carefully articulating the
decision making process
d. It never ensures the integrity of financial reports.
19. Out of the following which is the responsibility of an Auditor
a. Whether loans & advances made by the company on the basis of security have been properly
secured.
b. Whether loans & advances made by the company have been shown as deposits.
c. Whether personal expenses have been charged to revenue account
d. He has to ensure that his work involves exercise of judgment.
20. This theory assumes that managers are basically trustworthy and attach significant value to their
own personal reputation
a. Agency Theory
b. Stewardship Theory
c. Stakeholder Approaches
d. Sociological Theory
SECTION B: Short Notes (10 marks)
This section consists of short notes.
Answer all the questions.
Each Short Note carries 5 marks.
1. What is clause 49?
2. Explain Board of Directors & Corporate Governance?
SECTION C: APPLIED THEORY (20 marks)
This section consists of Long Questions.
Answer all the questions.
Each question carries 10 marks.
Detailed information should from the part of your answer (Word limit 150 to 200 words).
END OF SECTION B
END OF SECTION A
Examination Paper
IIBM Institute of Business Management 5
1. Banks are also using concept of Corporate Governance. Explain why Corporate Governance is
widely used in Banks. Also state few sound Corporate Governance Practices.
2. What is ethics & state why ethics is necessary in Business and also state the importance and need
of business ethics?
-----------------------------------------------------------***----------------------------------------------------------------
END OF SECTION C
Semester II Examination Papers
IIBM Institute of Business Management
IIBM Institute of Business Management
Semester-II Examination Paper MM.100
Production and Operation Management
Section A: Objective Type (30 marks)
This section consists of Multiple choice questions & Short Notes type questions.
Answer all the questions.
Part One questions carry 1 mark each & Part Two questions carry 5 marks each.
Part One:
Multiple choices:
1. If the number of restrictions on sources be ‘a’ and the number of restrictions on destinations be
‘b’ then with the use of ‘stepping stone procedure’, the number of ‘used cells’ will be
a. a+b+1
b. a+b+2
c. a-b-1
d. a+b-1
2. Value of smoothing coefficient ‘α’ lies
a. Between 1 and ∞
b. Between 0 and 1
c. Between -1 and 1
d. Between 1 and 2
3. Forecasting error is
a. The difference between forecasted demand and actual demand
b. The ratio of forecasted demand and actual demand
c. The difference between the standard forecast demand and the evaluated forecast demand
d. Ratio of standard forecast demand and the evaluated forecast demand
4. For forecasting the analyzers plot the demand data on a time scale, study the plot and then look
for the consistent patterns. Now what does the high noise mean to these patterns
a. Many of the point lie away from the pattern
b. Most of the points lie close to the pattern
c. All the points lie on the pattern
d. None
5. Payback period is
a. The length of time after which the production starts
b. The length of time after which the selling starts
c. The length of time required to recover the investment
d. The length of time for which firm bears replacement of the good.
Semester II Examination Papers
IIBM Institute of Business Management
6. Salvage value is the income from
a. Selling an asset
b. Buying an asset
c. Bargaining in selling
d. Price raised stock
7. On total factor basis ‘Productivity’ is given by x/y, where ‘y’ is
a. Labor + Capital +Materials
b. Labor + Capital + Materials + Energy
c. Capital
d. Capital + Materials
8. Economic efficiency is given by
a. Input /output
b. Input /100
c. (Output-input)/input
d. Output /input
9. This implies an effective management that ensures an organization’s long-term commitment to
the continuous improvement of quality.
a. Quality management
b. Strategic management
c. Total quality management
d. Operations management
10. This techniques for improving productivity involves analyzing the operations of the product or
service, estimate the value of each operation, and modifying (or) improving that operation so that
the cost is lowered.
a. Value engineering
b. Time-event network
c. Work simplifications
d. Quality circles
Part Two:
1. What are the different types of models in production and operation management?
2. Define ‘Depreciation’.
3. What do you understand by ‘Bias’?
4. What are ‘Learning curves’?
END OF SECTION A
Semester II Examination Papers
IIBM Institute of Business Management
Section B: Caselets (40 marks)
This section consists of Caselets.
Answer all the questions.
Each caselet carries 20 marks.
Detailed information should form the part of your answer (Word limit 200 to 250 words).
Caselet 1
COMPANY BACKGROUND
The Bronson Insurance Group was originally founded in 1900 in Auxvasse, Missouri, by James Bronson.
The Bronson Group owns a variety of companies that underwrite personal and commercial insurance
policies. Annual sales of the Bronson Group are $100 million. In recent years, the company has suffered
operating losses. In 1990, the company was heavily invested in computer hardware and software. One of
the problems the Bronson Group faced (as well as many insurance companies) was a conflict between
established manual procedures and the relatively recent (within the past 20 years) introduction of
computer equipment. This conflict was illustrated by the fact that much information was captured on
computer but paper files were still kept for practical and legal reasons.
FILE CLERKS
The file department employed 20 file clerks who pulled files from stacks, refilled used files, and delivered
files to various departments including commercial lines, personal lines, and claims. Once a file clerk
received the file. Clerks delivered files to underwriters on an hourly basis throughout the day. The
average file clerk was paid $8,300 per year. One special file clerk was used full time to search for
requested files that another file clerk had not been able to find in the expected place. It was estimated that
40 percent of the requested files were these “no hit” files requiring a search. Often these “no hit” files
were eventually found stacked in the requester’s office. The primary “customers” of the file clerks were
underwriters and claims attorneys.
UNDERWRITING
Company management and operations analysts were consistently told that the greatest problem in the
company was the inability of file clerks to supply files in a speedy fashion. The entire company from top
to bottom viewed the productivity and effectiveness of the department as unacceptable. An underwriter
used 20-50 files per day. Because of their distrust of the files department, underwriters tended to hoard
often used files. A count by operations analysts found that each underwriter kept from 100-200 files in his
or her office at any one time. An underwriter would request a file by computer and work on other
business until the file was received. Benson employed 25 underwriters.
MANAGEMENT INFORMATION SYSTEM
Upper management was deeply concerned about this problem. The MIS department had suggested using
video disks as a possible solution. A video disk system was found that would be sufficient for the
Semester II Examination Papers
IIBM Institute of Business Management
companies needs at a cost of about $12 million. It was estimated that the system would take two years to
install and make compatible with existing information systems. Another, less attractive was using
microfilm. A microfilm system would require underwriters to go to a single keyboard to request paper
copies of files. The cost of a microfilm system was $5 million.
1. What do you recommend? Should the company implement one of the new technologies? Why or
why not?
2. An operations analyst suggested that company employees shared a “dump on the clerks”
mentality. Explain.
Caselet 2
Harrison T. Wenk III is 43, married, and has two children, ages 10 and 14. He has a master’s degree
in education and teachers junior high school music in a small town in Ohio. Harrison’s father passed
away two months ago, leaving his only child an unusual business opportunity. According to his
father’s will, Harrison has 12 months to become active in the family food-catering business, Kare-
Full Katering, Inc., or it will be sold to two key employees for a reasonable and fair price. If
Harrison becomes involved, the two employees have the option to purchase a significant, but less
than majority, interest in the firm. Harrison’s only involvement with this business, which his
grandfather established, was as an hourly employee during high school and college summers. He is
confident that he could learn and perhaps enjoy the marketing side of the business, and that he could
retain the long-time head of accounting/finance. But he would never really enjoy day-to-day
operations. In fact, he doesn’t understand what operations management really involves. In 1991
Kare-Full Katering, Inc. had $3.75 million in sales in central Ohio. Net profit after taxes was $
105,000, the eleventh consecutive year of profitable operations and the seventeenth in the last 20
years. There are 210 employees in this labor-intense business. Institutional contracts account for
over 70 percent of sales and include partial food services for three colleges, six commercial
establishments) primarily manufacturing plants and banks), two long -term care facilities, and five
grade schools. Some customer location employs a permanent operations manager; others are served
from the main kitchens of Kare-Full Katering. Harrison believes that if he becomes active in the
business, one of the two key employees, the vice president of operations, will leave the
firm.Harrison has decided to complete the final two months of this school year and then spend the
summer around Kare-Full Katering – as well as institutions with their own food services – to assess
whether he wants to become involved in the business. He is particularly interested in finding out as
much as possible about operations. Harrison believes he owes it to his wife and children to fairly
evaluate this opportunity.
1. Prepare a worksheet of operations activities that Harrison should inquire about this summer.
2. If you were Harrison, what would you do? Why?
END OF SECTION B
Semester II Examination Papers
IIBM Institute of Business Management
Section C: Applied Theory (30 marks)
This section consists of Long Questions.
Answer all the questions.
Each question carries 15 marks.
1. Productivity is an important tool for mangers as it helps them to track progress toward the more
efficient use of resources in producing goods and services. Elucidate.
2. In additional to operations research, what are the other tools and techniques used by organizations
to improve productivity?
END OF SECTION C
---------------------------------------------------------***-------------------------------------------------------
IIBM Institute of Business Management
Examination Paper : Semester II
IIBM Institute of Business Management
IIBM Institute of Business Management
Examination Paper MM.100
Business Communication
Section A: Objective Type (30 marks)
· This section consists of multiple choices and Short Notes type questions.
· Answer all the questions.
· Part one questions carry 1 mark each & Part Two questions carry 4 marks each.
Part one:
Multiple choices:
1. __________is an essential function of Business Organizations:
a. Information
b. Communication
c. Power
d. None of the above
2. Physiological Barriers of listening are:
a. Hearing impairment
b. Physical conditions
c. Prejudices
d. All of the above
3. Which presentation tend to make you speak more quickly than usual:
a. Electronic
b. Oral
c. Both ‘a’ and ‘b’
d. None of the above
4. What is the main function of Business Communication:
a. Sincerity
b. Positive language
c. Persuasion
d. Ethical standard
5. The responsibilities of the office manager in a firm that produces electronics spares is:
a. Everything in the office runs efficiently
b. Furniture and other equipment in the office is adequate
c. Processing all the incoming official mail and responding to some
d. All of the above
Examination Paper : Semester II
IIBM Institute of Business Management
6. Labov’s Storytelling Model based on:
a. Communication through speech
b. Language learning
c. Group Discussions
d. None of the above
7. Diagonal Communication is basically the:
a. Communication across boundaries
b. Communication between the CEO and the managers
c. Communication through body language
d. Communication within a department
8. How to make Oral Communication Effective?
a. By Clarity
b. By Brevity
c. By Right words
d. All of the above
9. Direct Eye contact of more than 10 seconds can create:
a. Discomfort & Anxiety
b. Emotional relationship between listeners and speakers
c. Excitement
d. None of the above
10. Encoding means:
a. Transmission
b. Perception
c. Ideation
d. None of the above
Part Two:
1. Define Communication. How can you classify Communication?
2. Explain ‘Space Language’.
3. Differentiate between good listeners and bad listeners.
4. What are the different types of Business Reports?
5. What is Synopsis?
END OF SECTION A
Examination Paper : Semester II
IIBM Institute of Business Management
Section B: Case lets (40 marks)
· This section consists of Case lets.
· Answer all the questions.
· Each Case let carries 20 marks.
· Detailed information should form the part of your answer (Word limit 150 to 200 words).
Case let 1
Mr. and Mrs. Sharma went to Woodlands Apparel to buy a shirt. Mr. Sharma did not read the price tag on
the piece selected by him. At the counter, while making the payment he asked for the price. Rs. 950 was
the answer.
Meanwhile, Mrs. Sharma, who was still shopping came back and joined her husband. She was glad that
he had selected a nice black shirt for himself. She pointed out that there was a 25% discount on that item.
The counter person nodded in agreement.
Mr. Sharma was thrilled to hear that “It means the price of this shirt is just Rs. 712. That’s fantastic”, said
Mr. Sharma.
He decided to buy one more shirt in blue color.
In no time, he returned with the second shirt and asked them to be packed. When he received the cash
memo for payment, he was astonished to find that he had to pay Rs. 1,900 and Rs. 1,424.
Mr. Sharma could hardly reconcile himself to the fact that the counter person had quoted the discounted
price which was Rs. 950. The original price printed on the price tag was Rs. 1,266.
Questions
1. What should Mr. Sharma have done to avoid the misunderstanding?
2. Discuss the main features involved in this case.
Case let 2
I don’t want to speak to you. Connect me to your boss in the US,” hissed the American on the phone. The
young girl at a Bangalore call centre tried to be as polite as she could. At another call centre, another day,
another young girl had a Londoner unleashing himself on her, “Young lady, do you know that because of
you Indians we are losing jobs?”
The outsourcing backlash is getting ugly. Handling irate callers is the new brief for the young men and
women taking calls at these outsourced job centers. Supervisors tell them to be ‘cool’. Avinash Vashistha,
managing partner of NEOIT, a leading US-based consultancy firm says, “Companies involved in
outsourcing both in the US and India are already getting a lot of hate mail against outsourcing and it is
hardly surprising that some people should behave like this on the telephone.” Vashistha says Indian call
centres should train their operators how to handle such calls.
Examination Paper : Semester II
IIBM Institute of Business Management
Indeed, the furor raised by the Western media over job losses because of outsourcing has made ordinary
citizens there sensitive to the fact that their calls are being taken not from their midst, but in countries
such as India and the Philippines.
The angry outbursts the operators face border on the racist and sexist, says the manager of a call centre in
Hyderabad. But operators and senior executives of call centres refuse to go on record for fear of kicking
up a controversy that might result in their companies’ losing clients overseas.
“It’s happening often enough and so let’s face it,” says a senior executive of a Gurgaon call centre,
adding, “This doesn’t have any impact on business.”
Questions
1. Suppose you are working as an operator in a call centre in India and receiving calls from
Americans and Londoners. How would you handle such calls?
2. Do you agree with the view such abusive happenings on the telephone do not have any impact
on business?
END OF SECTION B
Section C: Applied Theory (30 marks)
· This section consists of Applied Theory Questions.
· Answer all the questions.
· Each question carries 15 marks.
· Detailed information should form the part of your answer (Word limit 200 to 250 words).
1. What is meant by Communication Barriers? How and why do they occur? What can be done to
overcome the Barriers to Communication?
2. Define and explain the term Negotiation and also briefly explain the phases of Negotiation.
END OF SECTION C
S-1-280111
Examination Paper: Human Resource Management
1
IIBM Institute of Business Management
IIBM Institute of Business Management
Examination Paper MM.100
Human Resource Development & Training
Section A: Objective Type (30 marks)
· This section consists of Multiple Choice and Short answer type questions.
· Answer all the questions.
· Part one questions carry 1 mark each & Part Two questions carry 5 marks each.
Part One:
Multiple choices:
1) Who used the term ‘Intellectual Capital’ for the first time?
a. Alvin Toffler
b. Tseng and Jiao
c. J K Galbraith
d. Rouibah and Ould-al
2) Organizational behavior is a:
a. Micro perspective
b. Macro perspective
c. Neo perspective
d. Latent perspective
3) Ethics in H R Development means:
a. Accepted behavior
b. Rejected behavior
c. Unexpected behavior
d. There is no term like, in HRD
4) What does ‘s’ stands for in COPS for conducting a detail HR analysis?
a. Shell
b. Swap
c. System
d. Site
5) In generic HRD model, training and development lies:
a. At bottom level
b. In middle level
c. A top level
d. Not a part of this model
6) Under the development part, the instructors use to focus on:
a. Skills of the learner
b. Process of the learner
c. Concepts of the learner
Examination Paper: Human Resource Management
2
IIBM Institute of Business Management
d. No focus
7) Gap is:
a. The difference between competency model and current state
b. The difference between ideal state and current state
c. The difference between ideal state and competency model
d. None of the above
8) According to Hamblin there are …… levels at which evaluation can be made.
a. 3
b. 4
c. 5
d. 7
9) Norm reference tests are:
a. Tests designed to measure degree of learning
b. To maximize the individual differences an for comparing them with externals.
c. To test the learner has mastered the taught one or not.
d. None of the above
10) David Kolb gave the idea that learning is a:
a. Linear process
b. Slow process
c. Unlimited process
d. Circular process
Part Two:
1. Explain PCMM (People Capability Maturity Model) approach for HRD.
2. Write a short note on ‘HRD Strategy model’.
3. Explain the utility of ‘Training Process Pyramid’.
4. What are ‘on-the-job’ and ‘off-the-job’ techniques of training and development?
END OF SECTION A
Examination Paper: Human Resource Management
3
IIBM Institute of Business Management
Section B: Caselets (40 marks)
· This section consists of Caselets.
· Answer all the questions.
· Each Caselet carries 20 marks.
· Detailed information should form the part of your answer (Word limit 150 to 200 words).
Caselet 1
Introduction to the organization:
XYZ Company was established 20 years ago, to manufacture gearbox components for diesel
engines. It employs around 250 people, having a head office, which employs a wide range of
personnel who are generally well educated and enthusiastic about their work, and a factory, which
employs semi-skilled local people who are generally disinterested in the products of the company
and who have an instrumental attitude to work, seeing salary as the only reward.
Brief Description of the Problem:
The performance of the Company has not been good and the records revealed the following facts:
· Wastage within the factory was costing the Company approximately Rs. 100,000 a month.
· There was wide spread differences in individual work standards
· Processes were non-standardized resulting in repeated problems
· Management made all decisions and cascaded the result down to employees
· The top management became concerned about the performance of the factory and they hired Mr.
Tanmoy Deb, an OD consultant to study the problem and suggest specific changes to
relationships and tasks with the following objectives:
· To review and improve communication systems.
· To restructure the organization and to review teamwork and quality practices.
· To review leadership issues across all levels.
Mr. Tanmoy Deb carried out discussions, interviews and surveys and made the following
observations:
· There’ and ‘us’ attitude was widely prevalent between head office and factory personnel
· Production personnel lacked technical skills
· Factory employees felt alienated from sharing the Company’s success
· Production systems were adhoc and defective because of frequent variations in standards set
· Many times raw material was found to be of inferior quality
· Rigidly defined job descriptions
Questions:
1. What in your view are the central human resources issues involved in this case?
2. What strategy should Mr. Tanmoy Deb develop and implement for improving the present
system?
Examination Paper: Human Resource Management
4
IIBM Institute of Business Management
Caselet 2
Introduction to the organization:
XYZ Company is an existing profit making FMCG Company. The company has 600 personnel
and has branches all other the country. It has a separate training department with a Training
Manager, Mr. A.P. Mohan as its head who is supported by two qualified training officers. Mr.
Mohan has been in the company for the last 8 years and is very efficient.
Brief Description of the Problem:
Mr. Mohan wants to leave the organization. He is fed up with organizational politics. He is
dissatisfied and infact frustrated. There are several reasons attached to it. First and foremost is
that he is not paid adequately despite the fact that he has brought 12% growth in revenue to the
company. Second reason is that he is not consulted and constantly neglected while making
decisions on training aspects. Lastly, he considers himself to be a victim of politics played in the
organization. Production Manager is constantly hurting him and interferes with the work. Dr.
Ashok Sarao, boss of Mr. A.P. Mohan does not want him to leave the organization, as he knows
that the effectively will come down if he leaves. Dr. Ashok tries to convince Mohan that he
should adjust himself with the environment and also talk of how Mohan is constantly neglected.
He talks of how politics is played in the organization and strengths and weaknesses of Mohan but
does nothing to convince Mohan. Rather he says that they have to adjust, as they are part of
family run business. In this setting, personal equation rather than merit works. Mohan is not
convinced, and says he is leaving.
Questions:
1. Why a high performer like Mr. Mohan decided to leave the organization he has been long
part of?
2. Do you think Mr. A.P. Mohan took the right decision to leave the organization? What would
you have done if you were in his shoes?
END OF SECTION B
Section C: Applied Theory (30 marks)
· This section consists of Applied Theory Questions.
· Answer all the questions.
· Each question carries 15 marks.
· Detailed information should form the part of your answer (Word limit 200 to 250 words).
1. Trace out the changing paradigm of growth. Why has human resource development assume
greater importance in present time?
2. Training effectiveness is crucial for the success of the training department. How will you
ensure it?
END OF SECTION C
Examination Paper: Human Resource Management
5
IIBM Institute of Business Management
IIBM Institute of Business Management
Examination Paper MM.100
Industrial Relations
Section A: Objective Type (30 marks)
· This section consists of True and False & Short Answer type questions.
· Answer all the questions.
· Part One questions carry 1 mark each & Part Two questions carry 5 marks each.
Part One:
True and False:
1. Central Board of Workers Education (CBWE) was set up in 1986.
2. The joint Departmental Councils are encouraged to hold annual meetings, a scheme which
was initiated in 1970.
3. The lockout of the pilots was lifted from 3rd November, 1974.
4. The Employers federation of India formed in 1936.
5. Indian Jute Mills Association (IJMA) was formed in 1887.
6. All India Trade federation was established in 1921.
7. In India, the foundation of modern industry was laid between 1850 and 1860.
8. HMS stands for Hind Maha Sabha.
9. A feature of Indian trade unionism is not the multiplicity of unions.
10. Standing Orders may provide as to who should enquire.
Part two:
1. Who are ‘Blue Collor’ workers?
2. What are the basic causes of ‘Grievances’?
3. Write a note on ‘Payment of Gratuity Act, 1972’.
4. Explain ‘Walker’s Model’ for worker’s participation in management.
END OF SECTION A
Examination Paper: Human Resource Management
6
IIBM Institute of Business Management
Section B: Caselets (40 marks)
· This section consists of Caselets.
· Answer all the questions.
· Each Caselet carries 20 marks.
· Detailed information should form the part of your answer (Word limit 150 to 200 words).
Caselet 1
(A)HISTORY OF THE FIRM:
Bombay Electricals was started in 1940 by Mr. Desai, a refrigeration engineer, as a proprietary company.
In 1941 he ran short of money and approached Mr. Khanna, Chairman of a large group of companies, for
help. Mr. Khanna decided to invest capital in the company and thereby obtained 75% control. The
company was later registered in 1945 as a Public Limited company but management was left all this time
in the hands of Mr. Desai. Until 1947 the company showed substantial losses because Mr. Desai started a
number of new product lines but did not stick to any long enough to establish either the production or the
markets. Nor did he make any study of the existing markets or production in the country before
introducing any of the products. This was a period in which the company launched and finally gave up a
number of products all of which resulted in severe losses. In 1947 two senior offices from the group were
brought into Bombay Electricals Company. Mr. Jain, an engineer by qualification, had served the Group
for twenty years and was appointed Works Manager. Mr. Sharma who had also been with the Group for
18 years was made Finance and Sales Manager. Within six months after Jain and Sharma joined the
company, Mr. Desai decided to retire. Mr. Jain was made General Manager (Works) and Mr. Sharma,
General Manager (Finance and Sales). At this stage management of the company rested with a part-time
Chairman, Mr. Khanna, who was also the Chairman of the parent Group, and with the two General
Managers. There were six superintendents for each of the manufacturing departments plus a sales
manager and an accountant. In 1949 the company took two decisions: (1) to suspend manufacturing all
products except those which could be manufactured by mass production methods, and (2) not to compete
with the small scale or cottage industry in any of its production lines. They agreed to concentrate only on
the manufacture of refrigerators and air conditioners. In the decade between1950-60, the company made
impressive progress and sustained a steady growth in production and in domestic and export sales. The
following figures show the employment and net income.
Year ending March Employment Net income in Lakhs
1947
1950
1960
500
750
3500
150.00
250.50
925.00
(B)FINANCIAL STATUS:
The company’s financial and cost position had deteriorated markedly between1958-1960. The rate of
equity divided declared was calculated by the company as 20% in 1956, 1957 and 1958; to 0.5 lakh in
1960. In 1960 if it had not been for 10 lakhs on profit on import entitlement and 18.50 lakhs on ‘other
income’, the balance available for equity dividends would have been a negative figure. The short-term
financial position of the company in March 1960 was tight and it faced a stringent cash position. The
costs on inventories too were high, imposing strain on the financial position. The finished stock levels in
March 1960 were equipment to a little over eight weeks production; in process stocks were equivalent to
about ten weeks production; and raw materials stocks were sufficient for about 15 weeks production. The
table below gives the expenditure on labour between 1958-1960:
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Year ended
March
Salary and
wages per
employee
Profits bonus per
employee
Other
expenditure per
employee
Total per
employee
1958
1959
1960
5344
5131
5434
400
346
286
217
317
576
6021
5793
6296
Separating these figures for workers from clerical staff, the cost per worker was Rs. 6,000 per year. The
comparable figures of earnings in other industries averaged Rs. 1,400 in 1960. Thus workers’ earnings in
Bombay Electricals were nearly four times the industry average. Furthermore, the earnings of the
employees in the company increased at an average of 13% between 1958 and 1960.
During the same period the figure below compares the physical output and average real earnings
(the figure of the real earnings is reached by allowing for the shift in consumer price index for the period).
Year Index of physical output per
employee earnings
Index of average real earnings
per employee
1958
1959
1960
100
133
123
100
120
108
(C) TECHNOLOGICAL STATUS:
When, in 1948, Bombay Electricals Limited decided that the company would not compete with the small
scale or cottage industry and would manufacture only those products which could be manufactured
economically by mass production techniques, it suspended the manufacture of small tools, at that time a
profitable product. The exclusive products on which the company concentrated were refrigerators and air
conditioners. Consequent upon the technical decisions to manufacture on mass production lines, highspeed
and special purpose machinery was gradually installed in the plant. The decision resulted also in
the setting up of an industrial engineering (work study) department and a vast development department.
The jobs were time-studied and after negotiations with the union, standards were established and these
were used in developing a comprehensive incentive scheme. In all cases workers achieved the targets and
often exceeded them. The technology of manufacturing refrigerators and air conditioners had remained
reasonably stable. Between1950-60 three models were introduced and each had required a change of
approximately 10-30 per cent parts. This implied that the basic processes had remained fairly constant and
the bulk of innovation had taken place in the methods of production. It was during this period that high
speed machinery and mass producing methods and equipment replaced slower and hand operated
machinery. As a result of the technological changes the output per employee was comparable to similar
production units abroad. These technological innovations have had direct bearing on the man-machine
relationships. Primarily these are two: one, the operator became an attendant to the machine as against the
skilled craftsman who he was before. His activities were governed by the speed of the machine and his
work was controlled by the technology rather the skill he could have exercised to improve the production;
two, the fictionalization of jobs on high speed, special purpose equipment used for manufacturing process
deprived him of his association with the totality of operations. The task became “meaningless’ from the
point of view of the operator. His concern therefore became one of earning a high incentive rate and for
job satisfaction he had to seek involvement elsewhere. The incentive scheme covered both direct and
indirect employees. Incentive earnings were often 100-200% of the basic earnings. The minimum take
home pay packet in the company was about Rs. 250.00 per month. At the same time, as the earnings
increased, the need to earn higher incentive became less imminent. The needs shifted from the economic
to the social levels. As would be discussed later, the alternative for the satisfaction of social needs was
denied in the work situation. The problem of social needs snowballed. As the earnings increased, the
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management decided to recruit workers from middle class families in preference to the traditional
working class population. The purpose for doing this was to obtain an educated workforce which would
support the company’s programme of rapid expansion and mechanization. To a large extent this policy
was successful in the context of increased output.
(D) ADMINISTRATIVE POLICY AND INDUSTRIAL RELATIONS:
As mentioned earlier the active management of the company rested with the Chairman and the two
General Managers. The Chairman visited Bombay almost every month. He believed in giving
considerable freedom of action to the local management. He saw his role as a philosopher and guide to
the local management and chose to take only broad policy decisions in matters of finance, sales, industrial
relations, employment etc. He made it known that the General Managers must evaluate his comments in
the light of the local conditions and should not regard his remarks as mandatory. He expressed his
management philosophy as “finding the right man for the job and then leaving him free to do it”. He
advocated the same philosophy for the General Managers. The Chairman during his visits spent a lot of
time individually with both the General Managers, but interacted more with Mr. Jain, General Manager
(works). Most of the discussions were held outside the office while they had lunch together or went for
morning walks or other simple, social occasions of this kind. Neither believed in the formal procedure of
writing down their decisions and preparing formal minutes. Very occasionally the Chairman and both the
General Managers discussed the policy or other issues together. This was party because the two General
Managers had shown visible signs of strained work relations between them although they were otherwise
friends. Both, the Chairman and the General Manager (works), believed in establishing personal
relationships with everyone in the company and both were highly regarded by employees. The General
Manager (works) knew at least half the workers in the factory by their first names and often went to their
houses during festivals or whenever an occasion demanded. Most employees felt free to approach him
with their personal problems. Invariably helped them even with money, sometimes from his own pocket.
Employees knew him as a kind person who had in mind their personal well-being as much as that of the
company. He had expressed his views by saying that Bombay Electricals should be seen as a company
that belongs to all those who contribute to its growth. He felt sure that the only problem was to produce
more and everyone would share its gains, but none should ever stop production; whatever problems
existed would be resolved by discussions among responsible people.
(E) INDUSTRIAL RELATIONS:
Bombay Electricals Limited Employees Trade Union was organized in 1946 by a well known trade union
leader who was also a member of the AITUC executive Committee. The union was not recognized by the
management in spite of several representations by the President. In 1951, as a protest against discharge of
four employees in the works without proper enquiry, the workers left their departments and assembled to
listen to an address by the union President. The General Manager (works) came out of his office and also
declared that he wished to address the workers. And he did. This was the first time that the General
Manager (works) and the union president met each other. The employees went back to work when the
management agreed to hold an enquiry by a joint team of representatives of the management and the
union. Consequent upon the enquiry two of the four employees were reinstated by the company. In the
meantime the union elected another President for their union who was also an experienced trade union
leader as well as a Member of Parliament on a communist party ticket. Although the union was not
officially recognized by the management, the two met together regularly and in 1955 signed a
comprehensive agreement for five years. This agreement covered the following:
· Recognizing the union as the sole bargaining agent for the employees and allowing them facilities
to collect union dues inside the factory;
· Wage scales, dearness allowance and other benefits;
· Incentive scheme
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· A network of consultative committees at departmental, works and top union management levels;
and
· Grievance procedure
Events after the agreement showed the following characteristics:
1. There were frequent meetings between the management at the departmental and works levels
but invariably the settlement took place only in the union’s meetings with the General Manager
(works).
2. Most departmental promotions and transfers involved consultations with the union and the
departmental heads seldom took a decision concerning an employee without formally or
informally consulting the union.
3. If the union disagreed with certain issues they quickly resorted to demonstrations within the
factory or stoppage of work. The Labour Welfare Officer was manhandled outside the factory.
The officer concerned left. On all these occasions the General Manager (works) solved the
dispute.
4. Inspite of a bonus formula traditionally used by the management, the employees agitated every
year when bonus was declared and they invariably got more bonus or loans after negotiations
with the General Manager (works).
5. Some representative incidents below would illustrate one aspect of the relationship:
(a) A worker, found smoking near the paint shop, where smoking was not allowed, complained that the
officer concerned manhandled him and issued a charge sheet even when he was not smoking. He claimed
that the officer was prejudiced and wanted him out of the department. Employees walked out of their
departments and demonstrated for withdrawal of the charge sheet. The General Manager (works) and the
union Secretary resolved this matter by everyone going back to the departments and the company
withdrawing the charge sheet.
(b) A peon was found asleep on his job and was charge sheeted. Repeated agitation led to withdrawal of
the charge sheet after top level discussions.
(c) At bonus time every year there were demonstrations. Workers left their departments, surrounded the
senior officers and indulged in drum beating until a settlement was reached.
(d) At the same time the company carried out a programme of expansion with all the attendant changes in
the departments. No serious difficulty was faced by the company in introducing technology change or in
increasing productivity per worker.
(F) THE STRIKE
In 1960 when the bonus was declared, the employees agitated in the same as they did in previous years.
The difference between the offer made to workers and the quantum demanded by them was about Rs. 30/-
(thirty) per employee. Unlike other years, the negotiations failed and the employees gave 15 days notice
to go on strike. The matter was taken up for conciliation by the State Labour Commissioner but the
dispute could not be settled. On the appointed day, the strike began and six anxious months went by
before a settlement was reached.
This case raises some highly interesting and significant questions:
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Questions:
1. Similar problems which caused this strike in 1960 were satisfactorily resolved in the past in Bombay
Electricals. Why could not the differences be settled in 1960?
2. Inspite of high earnings by employees, why did they choose to go on strike for a relatively small
difference of Rs 30/- in their demand preceding the strike?
Caselet 2
THE ORGANIZATION
Thomson and Richards, two technocrats from Holland, both in the age group of late 30s came as
consultants to Calcutta with French Company on a project assignment in 1940. They were quite
impressed with Indian culture and decided to settle down in India. Upon completion of their project, they
started their own company under the name Thomrich Pvt. Ltd. which manufactured agricultural
equipments. Encouraged by the performance of the company, they ventured into the manufacturing of
fertilizer manufacturing equipments in 1944 under the same banner. Their entrepreneurial skills and
success promoted them to diversify their business into manufacturing of lubricants in 1951, and
subsequently to electrical gadgets for industrial use in the year 1970. In the same year, they pioneered the
manufacturing of hovers at Chennai. In 1992, Thomrich Pvt. Ltd. entered the tractor segment and
established its plant at Gwalior, M.P. It entered into the tractor segment when another company KCP had
already established its reputation as a sole reliable brand. Unaffected by the competition, they started their
brand of tractors and soon, after three years they started manufacturing cultivators too. So far Thomrich
had a smooth sailing. With the coming of liberalization and globalization in the 1990s, Thomrich did not
remain untouched by the surmounting pressures of MNCs venturing into the Indian market. This made
them sell one of their profit-making divisions, i.e., the fertilizer manufacturing to a leading Indian
business house, to concentrate on their core competency areas. To add to the woes, the rumours of
Elegators, the world’s No. 1 tractor manufacturer foraying into Indian market gave sleepless nights. Being
protective, the company decided to enter in a collaborative venture with Wooge of France, the world’s
No. 2 tracror manufacturer, and rechristened itself to Thomrich-Wooge Pvt. Ltd. In the year 2002, they
improvised the then existing model in terms of efficiency by reducing its cycle-time, thereby becoming
No. 1 in the country. The company considered this product as flagship product, although it had not been
takes the place of KCP Tractors, despite improvisation in its efficiency. The company was purely
technocrat in nature with an annual turnover of Rs. 10,000 crores. With
Thomrich-Wooge Pvt. Ltd. contributing Rs. 125 crores to it. The Gwalior unit had a total strength of 308
employees, which included 94 executives and supervisors and the rest 214 as workmen. All the
executives were engineering graduates with 50% of them as locals. The workmen were ITI qualified with
60% of them as Weldors, 10% as Mechanics and 30% as Fitters. 40% of the workmen were from
Maharashtra and the rest were from Madhya Pradesh. K. Vaswani, a 54 year old technocrat who had
succeeded Ranjan Khare when he retired after serving this unit for 3 years, headed the Gwalior unit as
Chief Executive (C.E.). Vaswani had been with the company from 1972 to 1993 and had left to join
Conclave Ltd, an MNC, as Chief Executive. He rejoined Thomrich-Wooge Pvt. Ltd., in June 2004.
Vaswani did not seem to be different from the earlier CEs who had ingrained an employee-friendly
culture in the organization. He regularly held meetings with employees irrespective of their levels and
also made frequent visits to the shopfloor to have face-to-face interaction with the workmen.
HR PROCESSES
Thomrich-wooge had a policy of recruitment in two phases. The corporate office at Calcutta, through
campus selection, recruited the engineering graduates and the Certificate and Diploma holders were
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recruited independently at the unit level. The company did not encourage inter-unit transfers, although
there were a few need-based transfers to facilitate the employees’ and company’s operations. The
company had the policy of recruiting the graduate engineers at entry level and nurturing and grooming
them for higher positions. As a result, only the Thomrichians occupied all the top positions in all the units
of the organization. The company had a firm belief that the workers would always put their best efforts if
facilitated with good quality of work life and therefore, did not have the provision of monetary incentives.
They also believed that the incentive schemes would hamper the quality of products by compelling the
employees to pay more attention to quality rather than quality. Lured by the incentives they will somehow
try to sell the product without due consideration to the customer’s need. They felt that monetary
incentives can motivate an employee to a certain extent, and beyond that level it would fail to have any
impact on his efficiency. Rather, it would raise his expectations and unfulfilled expectations would lower
the morale of the employee. Nonetheless, the top management acknowledges and appreciated the
performance of workers from time to time. The company had a fixed wage / salary structure across all the
units in India. However, allowances varied from place to place. Thomrich-wooge had a performance
appraisal system based on management by objectives (MBO). The top management would set the goals
and communicate it to the CEs who in turn would pass down to the HODs. They were given sufficient
time to speculate on its feasibility and once the feasibility was decided; the goals were frozen and
communicated to the employees. At every quarter, the superiors would discuss the performance with the
employees and pass on the ratings to HR departments. The expert committee consisting of 4-5 members
from various functional departments evaluated these ratings. These members knew all the employees who
were being evaluated, and then they re-rated them to reduce the inter-rater bias. The ratings of the
committee were final and were communicated to the respective superiors, which was then discussed with
the concerned employees. The superiors would also counsel the subordinates in order to redress their
grievances, if any. Decisions regarding promotions and rewards were made annually and were based on
quarterly performance appraisals. The company had a 2-tier system of training, one at the plant level and
other at the corporate level. It had its own Management Development Centre at Darjeeling where most of
the training programs were conducted for managers, incorporating prayers and yoga too. The company
did not have a separate budget for training, it was need-based. Every employee was required to undergo at
least 15 days of training every year. Since, multiskilling was practiced within assembly lines, the
employees were exposed to both technical as well as behavioural training. Most of the trainers engaged
by the company were outsiders. All the training programmes were thoroughly evaluated every quarter by
talking the feedback from the immediate superior. The company would administer psychometric
measures once in three years to appraise the potential of employees fro various functional areas. Once the
competence and aptitude was identified in an employee, he was groomed in that particular area by a
mentor.
The company had a recognized trade union, which was earlier affiliated to Bhartiya Mazdoor
Sangh (B.M.S) and was now enjoying an independent status. The union would place a charter of demands
before the management once in four years, which was followed by harmonious negotiations between the
two. As the management involved the workmen even in the market survey of the products, the union also
discussed the quality issues with the management. The company’s employment policies radiated a single
principle that they believed in people and that they were the most valuable assets for them. Employees
had the freedom to see any superior ant time without prior appointment. The company boasted of an open
communication system, total transparency, no-status barrier, security and sense of professional among the
employees, which was reflected in the unit not witnessing any strike or major indiscipline since its
inception. The company had also introduced “Prayaas”, an HR-initiative as a proactive measure to have a
competitive edge in the dynamic scenario. Prayaas involved OD interventions like cross functional team,
large-scale integration, kaizen, etc. All the employees in the group of 3-5 were asked to suggest changes
for the betterment of the unit. Subsequent solutions and action plans were also invited from the employees
and the consolidated suggestions were implemented which resulted into introduction of suggestion
schemes, wastage utilization and recycling of packaging material. Some of the brilliant ideas of the
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employees were suitably recognized and widely circulated through in-house journals in all the units of
Thomrich.
CHALLENGES
Since 2002, the unit had seen 12% of executive turnover, which was earlier just 3%. This drew attention
of the top management who were confident of the high degree of employee-loyalty and believed that the
employees were emotionally attached to the unit. At this juncture, the HR Head, S. Abraham anticipated
trouble, as he feared that the turnover rate might increase in the wake of globalization and liberalization
with more and more MNCs offering lucrative packages and challenging assignments to the executives.
These firms were recruiting people at all levels, which made the employees feel that growth prospectus at
their units were rather slow. Moreover, employees had also become more risk talking and their varied
expertise encouraged them to experiment in new segments namely IT, Banking and BPOs. Though the
MNCs had 15-18 hours of working, but the changing orientation of employee made them feel that they
were handsomely compensated. S. Abraham apprehended further deterioration due to the influence of
Dollar Packages, which was unaffordable for Thomrich-Wooge Pvt. Ltd. The market conditions were
already tight with too many competitors, prices being down, customers becoming more demanding and
choosy, making the inputs scarce for the unit. Abhraham was considering the options of overcoming the
exodus of executives by increasing the efficiency with lesser input for which the company would have to
minimize its task force. This would tarnish its employee friendly image. The other was to increase the
profits by exploring new markets. The Indian market by now was already flooded with many players,
leaving the international market as the only option, which was equally a hard nut to crack. Abraham felt
trapped in a highly volatile situation, where he fumbled for a speedy and pragmatic remedy.
Questions:
1. Was the company’s decision to enter the tractor segment right, when KCP had already captured
the market?
2. Had you been Abraham, how would you tackle the present situation?
END OF SECTION B
Section C: Applied Theory (30 marks)
· This section consists of Applied Theory Questions.
· Answer all the questions.
· Each question carries 15 marks.
· Detailed information should form the part of your answer (Word limit 200 to 250 words).
1. What is inflation? Compare its role with money and the real earning of the Industrial workers.
Use appropriate data to justify your answer.
2. How can the bargaining affect the workers as well as the firm? “It is a method of wage fixation.”
Evaluate.
END OF SECTION B
S-2-210311

Examination Paper: Project Management
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IIBM Institute of Business Management
Examination Paper MM.100
Project Management
Section A: Objective Type (30 marks)
· This section consists of multiple choices questions and short answer type questions.
· Answer all the questions.
· Part One questions carry 1 mark each and Part Two questions carry 5 marks each.
Part One:
Multiple choices:
1. During _________formal tools and techniques were developed to help and manage large
complex projects.
a. 1950s
b. 1980s
c. 1920s
d. 1990s
2. PERT stands for:
a. Program Evaluation and Reverse Technique
b. Progress Evaluation and Review Technique
c. Program Evaluation and Review Technique
d. None of the above
3. The most basic model of any Operating System is:
a. Project Model
b. Input-output model
c. Output-input model
d. None of the above
4. Overall complexity =
a. Organizational complexity*resource complexity*technical complexity
b. Organizational complexity+technical complexity-resource complexity
c. Technical complexity+resource complexity/organizational complexity
d. Organizational complexity*resource complexity/technical complexity
5. Relevant areas of the APM body of knowledge are:
a. Quality Management
b. Budgeting and cost Management
c. Project Cost Management
d. Both ‘a’ and ‘b’
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6. Costs associated with the planning process include:
a. Planer’s tools
b. Opportunity cost
c. Planned labour and associated expenses
d. All of the above
7. CPA stands for:
a. Critical Path Analysis
b. Common Path Analysis
c. Critical Path Algorithm
d. Common Problem Analysis
8. The project duration with the normal activity time is ____days.
a. 11
b. 16
c. 17
d. 21
9. The nature of the work organization is important as it:
a. Defines responsibility and authority
b. Outlines reporting arrangements
c. Determines the management overhead
d. All of the above
10. Matrix Management was invented by
a. Mullins
b. Belbin
c. Drucker
d. Frederick Taylor
Part Two:
1. Define ‘Cost Estimating Techniques’.
2. Write a note on ‘Critical Path Analysis’.
3. Differentiate between General Management and Project Management.
4. What is ‘Team Life Cycle’?
END OF SECTION A
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Section B: Caselets (40 marks)
· This section consists of Caselets.
· Answer all the questions.
· Each Caselet carries 20 marks.
· Detailed information should form the part of your answer (Word limit 150 to 200 words).
Caselet 1
It’s a Risky Business
Four friends wanted to start a business. After much discussion, they had hit upon the idea of launch a
mail-order toys and games business. They were in the development stage of their business plan and
wanted to be sure that they had been through with their planning. To reinforce this, they had just received
a letter from a group of venture capitalists, agreeing to fund the start up. It concluded its review of their
plan by stating:
The business plan presents a credible opportunity for all involved and we are prepared to approve the
funding request, subject to a risk analysis being carried out on the project to start the business.
The group was stunned-the funding that they had been hoping for was suddenly a reality. Just one thing
stood in their way- that damned risk analysis process.
They started with identifying the key risk elements that could face the business during in start up phase.
They considered the process between the time that they received the funding and day one of trading. What
could possibly go wrong? Lots of things. They brainstormed the possibilities and recorded them. They
then considered the effect that these would have on the project as a whole. The list they generated
prothings going wrong and not enough making sure that the positive steps towards the business opening
were happening. They needed to priorities’ the events. As importantly, what would happen, when they
eventually occurred? Who would be responsible for each of them? On what basis could they rank each
risk, in order to identify the most important risks for which they would develop mitigation and
ownership?
They decided to use a table to show the risk event, the likelihood, the severity and by multiplying the two
providing a risk priority number (RPN). This would the allow ranking of the risk elements. For the three
highest ranked elements, the group then generates a mitigation process with someone in the group taking
ownership of that process.
As can be seen, the top three risks were identified and mitigation tasks put in place to either prevent the
risk event happening or to reduce its effect. The initials of the ‘owners’ of that risk in the last column
show who has agreed to monitor that set of events and ensure that the mitigation is put into place before
the project suffers from that event occurring.
Questions:
1. What further methods could have been used to generate ideas for the identification part of the risk
process?
2. What should happen as the project progresses to manage risk?
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Caselet 2
Fast-track Product Redevelopment at Instron
Background
Instron designs and manufactures machines for testing the properties of all types of material. One
particular plastic testing instrument has been selling around 250 units per year worldwide. In 1992 at the
height of the recession, with margins being squeezed and sales volume dropping, Instron decided to
redesign the instrument to reduce its cost and make it easier to manufacture.
The Project
Instron began to undertake change in the late 1980s, which included a programme to institute concurrent
new product development. This was accompanied by pressure for cost reduction, the introduction of
manufacturing changes, and the breaking of the firm into business teams.
The team was highly transient and changing environment, there were few restrictions on the way the
redesign project had to be handled. It was one of the first projects in Instron to be run from the beginning
as a concurrent engineering project. A small multi-functional team was formed, consisting of a
manufacturing engineer, a design engineer, a marketing engineer and a draughtsman. The design rief was
to improve the ease of manufacture of the product such tat a cost reduction of 20 percent could be
achieved.
The team was co-located in an area adjacent to the manufacturing facility. Although there was some
initial resistance, the comment was made that ‘they don’t know how they ever worked without it’. The
ease of communication and sharing of ideas became a more natural part of working life.
Adverse Effects
The principles of concurrency were, in general, favorably accepted by departments downstream of the
design process and with some notable exceptions, unfavorably viewed by the design department.
Individuals had concurrency imposed on them in the initial projects selected; be tried out. Senior
management staff was selected as champions of the cause, with the objective of overcoming the resistance
to change that existed. This came in a number of forms:
1. Passive resistance- summarized as ‘don’t show reluctance to apply the new ideas, attend all the
group meetings, nod in agreement, then carry on as before.
2. Active resistance- ‘do what you like, but don’t ask me to do it’
3. Undermining the initiative- through overstating the apparent problems.
They began by carrying out brainstorming sessions with manufacturing engineers, buyers, members of the
shop floor, suppliers and additional design engineers, to find new and innovative ways to improve the
product. The outcome of these investigations was to draw up a list of areas where improvements were
thought possible.
The Benefits Achieved
The results of this team’s action were:
· Cost reduced by 49 percent
· Product range rationalized from 12 to 2 versions
· Unique part count reduced from 141 to 98 and total number of parts reduced from 300 to 189
· Assembly/machining time reduced by 55 percent
· Project completed on time, with last version being released in April 1994.
Once operational, few problems were encountered and those that did occur were minor in nature. The
success was attributed by the firm to two decisions:
· The selection of the right project- one that made it easy to demonstrate concurrency
· The selection of the right people- those who were prepared to be open-minded and have some
enthusiasm for the changes.
The company now views this as a simple project that restored the profitability of an established product
through the use of innovation, ingenuity and new design techniques by the whole concurrent team. What
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IIBM Institute of Business Management
is also clear is that the product was subject to technical change in only one area- the materials used. The
other benefits have all been due to the approach tat the firm’s management has taken to its new product
development (NPD) Process. The firm felt that the project has been a success and that this method of
working would become an institutionalized methodology.
Questions:
1. Identify the steps the firm took in this project. How did this contribute to the success?
2. How might the main adverse effects be identified?
END OF SECTION B
Section C: Applied Theory (30 marks)
· This section consists of Applied Theory Questions.
· Answer all the questions.
· Each question carries 15 marks.
· Detailed information should form the part of your answer (Word limit 200 to 250 words).
1. What is the role of strategy in Project Management?
2. Identify the different roles that cost, price and profit can play in determining project costs.
END OF SECTION C
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IIBM Institute of Business Management
Examination Paper MM.100
Project Management in IT
Section A: Objective Type (30 marks)
· This section consists of multiple choice questions and short notes type questions.
· Answer all the questions.
· Part One questions carry 1 mark each and Part two questions carry 5 marks each.
Part One:
Multiple choices:
1. The knowledge areas of Project Management Process Group are:
a. Planning and Initiating
b. Executing and Closing
c. Monitoring and Controlling
d. All of the above
2. To create a successful project, a project manager must consider:
a. Scope
b. Time
c. Cost
d. All of the above
3. Which one of the following is not involved in the top ten skills or competencies of an effective
project manager:
a. People skills
b. Leadership
c. Integrity
d. Technical skills
4. Another name of a phase exit is a _______ point.
a. Review
b. Stage
c. Meeting
d. Kill
5. Which process group includes activities from each of the nine knowledge areas?
a. Initiating
b. Planning
c. Executing
d. Closing
Examination Paper: Project Management
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IIBM Institute of Business Management
6. The project team works together to create the ______.
a. Scope statement
b. WBS
c. WBS dictionary
d. Work package
7. __________ is a network diagramming technique used to predict total project duration.
a. PERT
b. A Gantt chart
c. Critical Path Method
d. Crashing
8. Which of the following is not a key output of project cost management:
a. A cost estimate
b. A cost management plan
c. A cost baseline
d. None of the above
9. CMMI Stands for:
a. Capability Maturity Model Integration
b. Complex Maturity Model Integration
c. Common Maturity Model Information
d. Capability Maturity Model Information
10. A proposal evaluation sheet is an example of:
a. RFP
b. NPV analysis
c. Earned value analysis
d. Weighted scoring model
Part Two:
1. Define Product Life Cycle.
2. What is Project Integration Model?
3. Write a note on Gantt charts.
4. What is Project Quality Management?
END OF SECTION A
Examination Paper: Project Management
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IIBM Institute of Business Management
Section B: Caselets (40 marks)
· This section consists of Caselets.
· Answer all the questions.
· Each Caselet carries 20 marks.
· Detailed information should form the part of your answer (Word limit 150 to 200 words).
Caselet 1
A preliminary estimate of costs for the entire project is $140,000. This estimate is based on the
project manager working about 20 hours per week for six months and other internal staff working a
total of about 60 hours per week for six months. The customer representatives would not be paid for
their assistance. A staff project manager would earn $50 per hour. The hourly rate for the other
project team member would be $70 per hour, since some hours normally billed to clients may be
needed for this project. The initial cost estimate also includes $10,000 for purchasing software &
services from suppliers. After the project is completed, maintenance costs of $40,000 are included
for each year, primarily to update the information and coordinate the “Ask the Expert” feature and
online articles. Projected benefits are based on a reduction in hours consultants spend researching
project management information, appropriate tools and templates, and so on. Projected benefits are
also based on a small increase in profits due to new business generated by this project. If each of
more than 400 consultants saved just 40 hours each year (less than one hour per week) and could bill
that time to other projects that generate a conservative estimate of $10 per hour in profits, then the
projected benefit would be $160,000 per year. If the new intranet increased business by just 1
percent, using past profit information, increased profits due to new business would be at least
$40,000 each year. Total projected benefits, therefore, are about $200,000 per year.
Exhibit A summarizes the projected costs and benefits and shows the estimated net percent value
(NPV), return on investment (ROI), and year in which payback occurs. It also lists assumptions
made in performing this preliminary financial analysis. All of the financial estimates are very
encouraging. The estimate payback is within one year, as requested by the sponsor. The NPV is
$272,800, and the discounted ROI based on a three-year system life is excellent at 112 percent.
Discount rate 8%
Assume the
project is done
in about is
months
Year
0 1 2 3 Total
Costs 140,000 40,000 40,000 40,000
Discount
factor
1 0.93 0.86 0.79
Discounted
costs
140,000 37,037 34,294 31,753 243,084
Benefits 0 200,000 200,000 200,000
Discount
factor
1 0.93 0.86 0.79
Discounted
benefits
0 186,185 171,468 158,766 515,419
Discounted (140,000) 148,148 137,174 127,013
Examination Paper: Project Management
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IIBM Institute of Business Management
benefits –
costs
Cumulative
benefits-costs
(140,000) 8,148 145,322 272,336 NVP
Payback in
year 1
Discounted
life cycle
ROI----_
112%
Assumptions
Costs #hours
PM (500hours,
$50/hour)
25,000
Staff (1500
hours,
$70/hour)
105,000
Outsourced
software &
services
10,000
Total project
costs (all
applied in year
0)
140,000
Benefits
# consultants 400
Hours saved 40
$/hour profit 10
Benefits from
saving time
160,000
Benefits from
1% increase in
profits
40,000
Total annual
projected
benefits
200,000
Questions:
1. What according to you are the factors that can hamper the profit growth related with the
project?
2. Mention some strategies to further improve the project’s turnover.
Examination Paper: Project Management
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IIBM Institute of Business Management
Caselet 2
Many organizations spend a great deal of time and money on training efforts for general project
management skills, but after the training, project managers may still not know how to tailor their
project management skills to the organization’s particular needs. Because of this problem, some
organizations develop their own internal information technology project management methodologies.
The PMBOKR Guide is a standard that describes best practices for what should be done to manage a
project. A methodology describes how things should be done, and different organizations often have
different ways of doing things. For example, after implementing a systems development life
cycle (SDLC) at Blue Cross Shield of Michigan, the Methods department became aware that
developers and project managers were often working on different information technology project in
different ways. Deliverables were often missing or looked different from project to project. They may
have all had a project charter, status report, technical documents (i.e., database design documents,
user interface requirements, and so on), but how they were producing and delivering these
deliverables was different. There was a general lack of consistency and a need for standards to guide
both new and experienced project managers. Top management decides to authorize funds to develop a
methodology for project managers that could also become the basis for information technology
project management training within the organization. It was also part of an overall effort to help raise
the company’s Software Capability Maturity Model level. BlueCross BlueShield of Michigan
launched a three-month project to develop its own project management methodology. Some of the
project team members had already received PMP certification, so they decided to base their
methodology on the PMBOKR Guide 2000, making adjustment as needed to best describe how their
organization managed information technology projects. See a complete article on this project on the
companion Web site for this text. Also see the Suggested Reading to review the State of Michigan
Project Management Methodology, which provides another good example of an information
technology project management methodology. Many organizations include project management in
their methodologies for managing Six Sigma projects. Other organizations include project
management in their software development methodologies, such as the Rational Unified Process
(RUP) framework. RUP is an interactive software development process that focuses on team
productivity and delivers software best practices to all team members. According to RUP expert Bill
Cottrell, “RUP embodies industry-standard management and technical methods and techniques to
provide a software engineering process particularly suited to creating and maintaining componentbased
software system solutions,” Cottrell explains that you can tailor RUP to include the PMBOK
process groups. Specifically, IBM Rational, the creators of RUP, found that it could adjust RUP input
artifacts with PMBOK process inputs, RUP steps with PMBOK process tools and techniques, and
RUP resulting artifacts with PMBOK process outputs.
Questions:
1. According to you what are the skills that needed for the project management of an organization?
2. How the six sigma project became a helpful tool in very sophisticated kind of project
management?
END OF SECTION B
Examination Paper: Project Management
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IIBM Institute of Business Management
Section C: Applied Theory (30 marks)
· This section consists of Applied Theory Questions.
· Answer all the questions.
· Each question carries 15 marks.
· Detailed information should form the part of your answer (Word limit 200 to 250 words).
1. What is cost? What is the importance of Project cost Management and explain basic principles of
Cost Management.
2. Define the following:
a. Resource Histograms
b. Project Communication Management
END OF SECTION C
S-2-260211

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