Semester II Examination Papers
IIBM Institute of Business Management
IIBM Institute of Business Management
Semester-II Examination Paper MM.100
Strategic 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. These are the plans formulated to achieve strategic goals.
a. Tactical plans
b. Strategic plans
c. Operational plans
d. Standing plans
2. This strategy facilities specialization by establishing a position of overall cost leadership,
differentiation, or both, but only within a particular segment, in an entire market.
a. Specific
b. Focus
c. Directive
d. Differentiation
3. This plan basically defines the actions of major departments and other sub-units that are required
in the execution of a strategic plan.
a. Tactical plan
b. Operational plan
c. Single-use plan
d. Long-term plan
4. This is a distinctive business or collection of related business, that can be managed relatively
independent of other businesses within the organization
a. Functional unit
b. Department unit
c. Organizational unit
d. Strategic business unit
5. These strategic plans of the organization have a time-frame exceeding five years.
a. Short-terms plans
b. Single-use plans
c. Long-term plans
d. Intermediate plans
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6. Operational plans are mainly oriented towards issues that usually have a time horizon of
a. About five years
b. 3 to 5 years
c. 1 to 2 years
d. One year or less
7. These refer to the determination of the purpose and the basic long-term objectives of an
enterprise, and the adoption of courses of action and allocation of resources necessary to achieve
these aims.
a. Strategies
b. Plans
c. Policies
d. Procedures
8. These strategies provide guidelines for organizational growth
a. Organizational
b. Finance
c. Marketing
d. Growth
9. There are the three major kinds of standing plans: policies, rules, and
a. Projects
b. Programs
c. Procedures
d. Standards
10. This step in the planning process involves putting the plan into action.
a. Implementation
b. Selection
c. Evaluation
d. Review
Part Two:
1. Explain the ‘Adaptive mode’ of strategic management.
2. What is ‘Behavioral theory’?
3. Write about ‘Delphi technique’ of forecasting.
4. What are the basic steps one should follow for the ‘Value chain analysis’?
END OF SECTION A
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Section B: Caselet (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
Akash Engineering Ltd. (AEL) had achieved sales of Rs. 3440 lakhs during the year 2004-05 against
sales of Rs. 1209 lakhs previous year. The sales this year were highest ever achieved in the history of
the company. Profit before interest, depreciation and taxes were Rs. 642 lakhs as against Rs. 81
lakhs during the year 2003-04, which showed a tremendous increase (8 times) in profitability of the
company. Economic indicators were still positive in the coming year for the company.
COMPANY SNAPSHOT
AEL was established in the year 1963 at Dediyasan GIDC, Mehsana, Gujarat, India. The Golden
Mills Limited – a flagship company of the prominent Indian Business Group had acquired the
controlling interest of AEL since 1993. AEL, a mid-sized company, was one of the leading in
manufacturing companies process equipments for Chemicals, Petrochemicals, Pharmaceuticals,
Fertilizers, Drugs and allied industries. Attainment of the highest standard of quality and
enhancement of customer satisfaction had been the corporate philosophy of the company. In line
with corporate philosophy, the management reaffirmed its commitment for providing reliable quality
products and services through understanding and fulfilling customer’s requirements, use of prime
quality raw materials, defined process control at each stage of manufacturing, meeting national and
international standards defined by customers, training and motivating employees, professional
approach and implementation of international quality management system standards.AEL had been 7
producing Columns, Heat Echangers-Coolers-Chillers-Condensers, Pressure Vessels, Reactors,
Deaerators, Economizers, Oxygen / Nitrogen Storage Tanks, Dished Ends, Centrifuges, Chlorine and
other allied Gas Cylinders and Expansion Bellows. The product was highly of a technical nature and
AEL was well-known in the market for its prompt response and good quality products. They had
developed import substitute products like rocket buster and spherical pressure vessels. AEL was into
direct marketing and customized services. It had served various industrial sectors and prominent
buyers like ISRO, BARC, IOCL, Kochi Refineries, HPCL, BPCL, British Oxygen, Inox India,
Kirloskar Pneumatic, Reliance Petro, IPCL, Ranbaxy, NTPC, HILL, Godrej, BHEL and J.K.
Industries.
Issues
Till 1993, the top management had 20% stake in AEL and they never took active interest in its
management. In comparison with other companies of Indian Business Group, it was very small.
Since inception, its products were highly technical in nature and AEL was well known in the market
for its prompt response and good quality products. They had also developed import substitute
products like rocket buster and spherical pressure vessels. For initial years, AEL made profits. Then
also, from 1985 to the year 2002, AEL was in trouble because sales declined continuously. During
those years, the company was making losses. It had been, therefore, registered as a sick unit by BIFR
(Board of Industrial and Financial Reconstruction) in the year 2001 under the provisions of the Sick
Industrial Companies (Special Provisions) Act, 1965. Other major issues were related to Human
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Resources. Conventionally, many workers joined through relations in the organization. There was no
performance measurement system for workers and managerial staff in the organization, which had
made them dull and lethargic. Moreover, there was no training program for labors to improve their
efficiency. The company needed to sharpen the skills of the workers. The competition had
intensified with big companies like laser and Toubro Ltd., ISAAC, Vadodara, GMM (Gujarat
Machinery Manufacturer), Vadodara, making their presence felt through their focused approach by
importing the manufacturing machineries from the developed countries. This made machineries of
AEL outdated. Moreover, many small fabricators also had ventured into this area. The research and
development in the company was always lop-sided. The company had never focused on reinvesting
in this area. Its capital investment in R & D was almost nil and recurring expenditure was only Rs.6
lakhs during the Year 2004-05. The profitable customers like, ISRO, BARC had already withdrawn.
Increase in prices of steel and other major raw materials, rise in other input costs, had squeezed
margins. Under tough competition and working capital shortage, the company had become almost
non-performing. The economic downfall, continued recession in the country and the world over had
further added fuel to the fire, making it difficult for the company to survive.
Steps taken by Management
As a measure towards labor problems, the management decided to give the option of Voluntary
Retirement Scheme (VRS) to all its employees. As a result, 278 labors and 34 staff members opted
for voluntary retirement under the VRS facilitating the company to decrease overheads to a large
extent. To fulfill the skilled workers were called back on a contractual basis. Since there was not any
performance measurement and incentive plan, AEL had to lose 3 to 4 good people to its competitors.
The company had now started the performance link bonus scheme wherein monetary benefit of 25
percent hike in the wages and salaries was given. It also started a training program, for its
contractual labors and appointed full time CEO from Arvind Mills. The company also hired a
consultant (who was an employee for more than 20 years at a senior level in Larsen & Toubro Ltd.)
for textile machinery and air handling system. It also made strategic alliances with few of the
renowned consultants, like, Engineers India Limited, Jacob H&G limited, UHDE India Limited,
Toyo Engineering Limited, Linde – West Germany, Monsanto – U.S.A., Kvaerner Powergas India
Limited, Tecnmont ICB India, Dalal Mott McDonald, Project Development India Limited, Chemtex
Engineering Ltd., Tata Consultant Engineers.AEL also developed in house R&D Laboratory –
approved by the Govt. of India and authorized to issue Certificate of Testing carries out. For this, it
imported technology for the manufacture of Industrial Centrifuges from West Germany and through
continuous interaction with R&D, company was able to fully absorb and adopt this technology. The
boost exports in developed countries like US, UK ad other European countries. With this quality
certification, the company felt that they had reaped the result in that very year by getting good orders
from HINDALCO and BHEL,. As a result, the profitability in 2004-05 reached an all time high.
PRESENT SCENARIO AND FUTURE PLAN
AEL’s turnover had reached the level of Rs. 34.4 crores, which helped them to recover all the debts.
The organizational structure was flat and there were no second line managers. Even the existing
managers were reluctant to pass the information and share their experiences with the new recruiters.
The image of AEL regarding the quality had to be reregistered in the minds of customers.AEL’s
short-term goal was to increase the turnover from current Rs. 34.3 crores to Rs. 150crores. The new
target was set Rs. 500 crores. And for this the management had identified new business divisions
like Textile Machineries, Air Handling System, Duplex Stainless Steel and Super Duplex Stainless
Steel, Aluminium and its alloys, Consulting Division Specialized in Power Plant and Waste water
Treatment and Non-conventional Energy System. Of which, textile machineries, power plan and airhandling
system would work as backward linkage to other companies of Indian business group. The
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management planned to convert the design department as an individual responsible profit centre, to
develop the designs for own business as well as providing consultancy to other businesses. Although
the CEO had a great pleasure in announcing that the company had reached a turnover of Rs. 34.4
crores but was a little bit apprehensive about the bumpy roads towards the Rs. 150 crores target.
1. If you were appointed as a CEO of AEL, Would you like to go for a separate design division?
2. Critically evaluate the future plans of AEL.
3. Do you think the target set by AEL was realistic? Comment.
4. Comment on the management strategies adopted by AEL.
Caselet 2
Alloys and Metals Pvt. Ltd., Indore was established by Kartik Jain in the year 2000, with the vision
to cater to the needs of the booming Steel Industry. The company started with the manufacturing of
Ingots – a steel product, which served as an input for production process in Hot Rolling Mills. The
manufacturing unit was situated at Pithampur, an industrial zone where the government offered
several incentives, rebates and subsidized electricity. Over 20 years of experience in steel trading
business prompted Kartik and his brother to invest their own capital to set up this unit. Later on, they
took financial assistance from Indian Overseas Bank. His brother supervised production at the
manufacturing unit whereas he concentrated on acquiring suppliers, marketing and distribution of
the product. Initially, when they entered into the business, the demand far exceeded the supply, and
this attracted those to enter the market. The manufacturing unit employed 150 workers; out of which
80 percent were on contract basis while the rest were wage holders. They worked in two shifts of
nine hours each, and the plant was shut down for six hours daily. The company had introduced a
number of innovative HR policies to keep motivation and morale of its workers high. They paid
overtime for extra hours put in by the employees. This considerably reduced employee absenteeism
and turnover. The company provided group insurance under the Employee State Insurance Scheme
(ESI) and all other safety measures for their benefits. The production capacity was 80 tones per day.
The company manufactured Ingots of various sizes (3”- 4”, 3.25” – 4.25”, 3.50” – 4.50”) as per the
requirement of the customers. The manufacturing unit was prone to accidents as the Ingots were
manufactured at temperatures as high as 17000c. Maintenance of such high temperature required
heavy power consumption and the expenditure on power was only approx. rs.50-60 Lakhs per
months. The company had also ser up a waste recycling plant at Pithampur as on an average 10
percent of the material was wasted. The recycled product was then further used as raw material.
Steel scrap, used to produce Ingots was purchased locally from Shree Gears Pvt. Ltd., Dewas Steel
India Ltd., Dewas, and T-Tee Industries Pvt. Ltd. Dewas. They also imported the same from various
countries like South Africa, Britain and Thailand. The firm had big cost disadvantage when it came
to procurement of raw materials. Due to the quality nature of the supplier base, the firm funds it
extremely difficult to maintain the quality and consistency of raw material. The finished product was
supplied to companies like Gowardhan Saria, Richa Steel;s Pvt. Ltd. and Shivam Ispact Pvt. Ltd.,
Indian Metal Industries (IMI), Indian Rolling Mills, Saathi Steels Pvt. Ltd., Central Steels Pvt. Ltd.
and Shivam Ispact Pvt. Ltd. and to other steel units in Rajasthan, Gujarat and Punjab. The
distribution channel of the company was not very complex. It was primarily through direct selling or
intermediate brokers in certain cases. The firm did not have a very well-developed marketing
department because of the fixed clientele. Ingot being a commodity product was quoted on the
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NCDX (National Commodities Exchange) and its rates varied between Rs. 1000-2000 per Ton.
Selling price was also dependent on the rates prevailing in Ghaziabad, Mandi Govindgarh, Raipur
and Calcutta as well as upon the various competitors’ rates prevailing in the market. Competition
was faced from Mayura Steels, Anand Steels, Sarkar Ispat, Shivani Estates Re-rolling Mills and
Sliver Ingots and other national manufacturers. The company used to purchase raw materials in cash
and kept at least 10 days of inventory. On the other hand, the company’s sale was mostly on credit,
with a time limit of 15-30 days. The company had a long list of defaulters – both buyers and sellers.
An incident involving a vendor who had defaulted with the supply of raw material was a matter of
growing concern for Kartik. A consignment due from Anna Enterprises, Thailand never reached
Alloys & Metals Pvt. Ltd., even though an advanced payment of $40,000 had been made at the time
of placing the order. The material was supposed to have arrived within 10 days, but in spite of
repeated reminders – telephone calls, fax and e-mails – delivery was not received even after a period
of two months. He then began to contact the person who had referred the particular supplier, but did
not get any satisfactory response from his end. He also contacted the Reserve Bank of India for
further course of action but he received no reply from them also. Being a member of the National
Steel Association, Mumbai he tried to seek their assistance for dealing with the matter but here also
he faced dejection. Neither the defaulters not the increasing competition deterred him from
visualizing a better future for the company. Disparity in demand and supply, increase in competition
and competitors’ diversification strategies, technological advances and the continuing boom in the
steel industry further motivated him to expand and diversify. In a period of two years, the company’s
turnover had reached over Rs. 45 crores. Encouraged by such a tremendous growth, Kartik was
planning to install a new Blast furnace to double its production capacity. As an initiative for future
development and expansion, they were also looking into the avenues of diversification into
manufacturing products like Channels, Angels and Rounds with plans to enter the retailing sector.
Now, he was at crossroads thinking whether and how to go about this diversification process.
1. As Kartik, what would have been your strategies to deal with the defaulters?
2. What steps should Kartik adopt before expansion and diversification? Would it be a wise decision
to diversify at this stage?
END OF SECTION B
Section C: Applied Theory (30 marks)
This section consists of Long Questions.
Answer all the questions.
Each question carries15 marks.
1. Strategic planning involves both, the development of organizational objectives and the
laying down of specifications about how they will be accomplished. In this context,
outline the major steps in the strategic planning process.
2. Implementing strategies effectively is of great importance. The success of a strategy
depends on how effectively it is implemented. Elucidate.
END OF SECTION C
Semester II Examination Papers 18
IIBM Institute Of Business Management
IIBM Institute of Business Management
Semester-II Examination Paper MM.100
Management Information Systems
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 & Part two questions carry 5 marks each.
Part one:
Multiple choices:
1. The BCD(binary code division) equivalent of (13)10 is
a. D
b. 1101
c. 00010010
d. 00010011
2. These systems are intended to help individual managers in their decision-making capability.
a. Management information
b. Executive support
c. Decision support
d. Office automation
3. Linux is a ……. Bit UNIX like operating system.
a. 16
b. 32
c. 64
d. 8
4. This is the ability of a system to repair itself, survive and grow by importing resources from its
environment and transforming them into outputs.
a. Negative entropy
b. Positive entropy
c. Entropy
d. Neutral entropy
5. A computer-based information system that increase the efficiency and productivity of
managers and office workers through document and message processing is known as
a. Decision support system
b. Management information system
c. Office automation system
d. Transaction processing system
6. Which is a multiuser operating system
a. MS DOS
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b. Windows NT
c. VMS
d. None
7. More information and knowledge is an advantage of this decision-making.
a. Individual
b. Strategic
c. Operational
d. Group
8. ISDN stands for
a. International service digital network
b. International service data network
c. Integrated service digital network
d. Integrated service data network
9. MYCIN is a popular expert system used for
a. Financial planning
b. Mineral exploration
c. Mass spectrography
d. Medical diagnosis
10. This refers to the flow of information among people on the same or similar organizational
level.
a. Diagonal
b. Upward
c. Horizontal
d. Downward
Part Two:
1. What are ‘Empirical systems’?
2. Write a note on ‘EPAB’.
3. Differentiate between interpreter and compiler.
4. What is ‘Virtual Reality’?
END OF SECTION A
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).
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Caselet 1
The Universal Foods and Drinks Limited (UFDL) is a company, manufacturing different
types of packaged foods and drinks. The product range consists of more than 50 items and 200
packaging units. The company’s products are popular throughout the country like Jammu &
Kashmir, Maharashtra, Karnataka and Kerala. It has a wide network of distributors and dealers,
who stock the UFDL products and deal with all types of customers. The company through its
network reaches to over 50,000 retail points. Some of the products of the UFDL are produced
throughout the year and are sold through this wide network. Some products are seasonal in
production but are sold throughout the years. And some products are popular in certain seasons and
not in demand at all in the other seasons. The business performance of the company is assured well,
if the UFDL produces the products as per the varying demand pattern of the customers. Since, the
company has established its strength in the distributor dealer network, the success comes through
the appropriate decisions in the purchase of fruits, vegetables, cereals, and pulses and putting them
through processing and packaging, and dispatching them to various locations where the distributors
are located. It is the policy of the company to launch each year at least one new product in the
country. This policy has paid rich dividends, to the company in terms of its image and the
customers have always looked forward for such an announcement from the company’s end. The
UFDL uses, well in advance, the different advertising media such as the newspapers, hoardings,
magazines, sample tests and demos, T.V. etc for announcing and promotion of its new products
from time to time. However, the selection of media is based on the product and its overall position
in the product range and the targeted market segment. In spite of considerable strength in many
aspect of business, the company has failed in the launching of new products. It was also not able to
meet the demand owing to the inadequate purchases of raw-materials, the wastage of the rawmaterials
as the processing plant of the company was not available due to its maintenance schedule
or it was scheduled for some other food processing operation. The company also faces the problems
of high seasonal inventory which, if not disposed of in time, becomes a non-moving and sometimes
a non-saleable inventory. The UFDL has its Marketing Division headed by a Manager- Marketing
supported by the product Manager for a group of its products.
1. Suggest the different Decision Support System (DSS) which the management of the UFDL may
use for strategic management of the business.
2. Suggest the external sources of information for the top management to support their decisionmaking,
justifying its position in an MIS.
Caselet 2
There’s nothing like a punchy headline to get an article some attention. A recent piece in the
Harvard Business Review (May 2003), shocking labeled “IT Doesn’t Matter,” has garnered the
magazine more buzz than at any time since the Jack Welch affair. The article has been approvingly
cited in The New York Times, analyzed in Wall Street reports, and e-mailed around the world. But
with out such a dramatic and reckless title, I doubt the article would have been much noticed. It’s a
sloppy mix of ersatz history, conventional, moderate insight, and unsupportable assertions. And it is
dangerously wrong. Author Nicholas Carr’s main point is that information technology is nothing
more than the infrastructure of modern business, similar to railroads, electricity, or the internal
combustion engineering advances that have become too commonplace for any company to wangle a
strategic advantage from them. Once innovative applications of information technology have now
become merely a necessary cost. Thus Carr thinks today’s main risk is not under using IT but
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overspending on it. But before we get any further, let’s have a reality check. First, let’s ask Jeff
Immelt, the CEO of General Electric Co., one of the premier business corporations in the world,
this question: “How important is information technology to GE?” Here’s his answer: “it’s a
business imperative. We’re primarily a service-oriented company, and the lifeblood for productivity
is more about tech than it is about investing in plants and equipments. We tend to get a 20 percent
return on tech investments, and we tend to invest about $2.5 billion to $3 billion a year.hen let’s ask
Dell Corporation CEO, Michael Dell: “What’s your take on Nick Carr’s thesis that technology no
longer gives corporate buyers a competitive advantage?” Here’s His answer: “Just about anything
in business can be either a sinkhole or a competitive advantage if you do it really, really bad or you
do it really, really well. And information technology is an often misunderstood field. You’ve got a
lot of people who don’t do it very well. For us, It is a huge advantage. For Wal Mart, GE, and many
other companies, technology is a huge advantage and will continue to be. Does that mean that you
just pour money in and gold comes out? No, you can screw it up really bad. Finally, let’s ask Andy
Grove, former CEO and now Chairman of Intel Corporation, a direct question about IT: “ Nicholas
Carr’s recent Harvard Business Review article says: ‘IT doesn’t Matter.’ Is information technology
so pervasive that it no longer offers companies a competitive advantage?” Andy says: “In any field,
you can find segments that are close to maturation and draw a conclusion that the field is
homogeneous. Carr is saying commercial- transaction processing in the United States and some
parts of Europe has reached the top parts of an S-Curve. But instead of talking about that segment,
he put a provocative spin on it- that information technology doesn’t matter – and suddenly the
statement is grossly wrong. It couldn’t b further from the truth. It’s like saying: I have an old threespeed
bike, and Lance Armstrong has a bike. So why should he have a competitive advantage?”So,
basically, Carr misunderstands what information technology is. He thinks it’s as merely a bunch of
networks and computers. He notes, properly, that the price of those has plummeted and that
companies bought way too much in recent years. He’s also right that the hardware infrastructure of
business is rapidly become commoditized and, even more important, standardized. Computers and
networks per se are just infrastructure. However, one of the article’s most glaring flaws is its
complete disregard for the centrality of software and the fact that human knowledge or for
information can be medicated and managed by software. Charles Fitzgerald, Microsoft’s general
manager for platform strategy, says that Carr doesn’t put enough emphasis on the “I” in IT. “The
source of competitive advantage in business is what you do with the information that technology
gives you access to. How do you apply that to some particular business problem? To say IT doesn’t
matter is tantamount to saying that companies have enough information about their operations,
customers, and employees. I have never heard a company make such a claim.”Paul Strassman who
has spent 42 years as a CIO-at General foods, Xerox, the Pentagon, and most recently NASA was
more emphatic. “The hardware—the staff everybody, is fascinated with- isn’t worth a damn,” he
says. It’s just disposable. Information technology today is knowledge –capital issue. It’s basically a
huge amount of labor and software.” Says he: “Look at the business powers- most of all Wal-Mart,
but also companies like Pfizer or FedEx. They’re all waging information warfare.”
1. Do you agree with the argument made by the business leaders in this case in support of the
competitive advantage that IT can provide to a business? Why or why not?
2. What are several ways that IT could provide a competitive advantage to a business? Use some of
the companies mentioned in this case as examples. Visit their websites to gather more
information to help you answer.
END OF SECTION B
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Section C: Applied Theory (30 marks)
This section consists of Long Questions, answer all the questions.
Each question carries 15 marks.
1. Shells Company has adopted a new management information system (MIS) in its Chennai
branch. Though the MIS promised rich benefits, Shells’ employees were quite apprehensive
about the new change and resisted this recent move of the company. Can you suggest some
measures or techniques for overcoming resistance to change at Shells?
2. A key element in both planning and controlling is information. What are the main attributes
that information must possess in order to be useful to managers? And is the nature of the
information required by managers at different levels similar or does it varies along with the
hierarchy?
END OF SECTION C
Examination Paper: Human Resource Management
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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
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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
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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
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?
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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
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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
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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
(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
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IIBM Institute of Business Management
Semester-II Examination Paper MM.100
Strategic 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. These are the plans formulated to achieve strategic goals.
a. Tactical plans
b. Strategic plans
c. Operational plans
d. Standing plans
2. This strategy facilities specialization by establishing a position of overall cost leadership,
differentiation, or both, but only within a particular segment, in an entire market.
a. Specific
b. Focus
c. Directive
d. Differentiation
3. This plan basically defines the actions of major departments and other sub-units that are required
in the execution of a strategic plan.
a. Tactical plan
b. Operational plan
c. Single-use plan
d. Long-term plan
4. This is a distinctive business or collection of related business, that can be managed relatively
independent of other businesses within the organization
a. Functional unit
b. Department unit
c. Organizational unit
d. Strategic business unit
5. These strategic plans of the organization have a time-frame exceeding five years.
a. Short-terms plans
b. Single-use plans
c. Long-term plans
d. Intermediate plans
Semester II Examination Papers
IIBM Institute of Business Management
6. Operational plans are mainly oriented towards issues that usually have a time horizon of
a. About five years
b. 3 to 5 years
c. 1 to 2 years
d. One year or less
7. These refer to the determination of the purpose and the basic long-term objectives of an
enterprise, and the adoption of courses of action and allocation of resources necessary to achieve
these aims.
a. Strategies
b. Plans
c. Policies
d. Procedures
8. These strategies provide guidelines for organizational growth
a. Organizational
b. Finance
c. Marketing
d. Growth
9. There are the three major kinds of standing plans: policies, rules, and
a. Projects
b. Programs
c. Procedures
d. Standards
10. This step in the planning process involves putting the plan into action.
a. Implementation
b. Selection
c. Evaluation
d. Review
Part Two:
1. Explain the ‘Adaptive mode’ of strategic management.
2. What is ‘Behavioral theory’?
3. Write about ‘Delphi technique’ of forecasting.
4. What are the basic steps one should follow for the ‘Value chain analysis’?
END OF SECTION A
Semester II Examination Papers
IIBM Institute of Business Management
Section B: Caselet (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
Akash Engineering Ltd. (AEL) had achieved sales of Rs. 3440 lakhs during the year 2004-05 against
sales of Rs. 1209 lakhs previous year. The sales this year were highest ever achieved in the history of
the company. Profit before interest, depreciation and taxes were Rs. 642 lakhs as against Rs. 81
lakhs during the year 2003-04, which showed a tremendous increase (8 times) in profitability of the
company. Economic indicators were still positive in the coming year for the company.
COMPANY SNAPSHOT
AEL was established in the year 1963 at Dediyasan GIDC, Mehsana, Gujarat, India. The Golden
Mills Limited – a flagship company of the prominent Indian Business Group had acquired the
controlling interest of AEL since 1993. AEL, a mid-sized company, was one of the leading in
manufacturing companies process equipments for Chemicals, Petrochemicals, Pharmaceuticals,
Fertilizers, Drugs and allied industries. Attainment of the highest standard of quality and
enhancement of customer satisfaction had been the corporate philosophy of the company. In line
with corporate philosophy, the management reaffirmed its commitment for providing reliable quality
products and services through understanding and fulfilling customer’s requirements, use of prime
quality raw materials, defined process control at each stage of manufacturing, meeting national and
international standards defined by customers, training and motivating employees, professional
approach and implementation of international quality management system standards.AEL had been 7
producing Columns, Heat Echangers-Coolers-Chillers-Condensers, Pressure Vessels, Reactors,
Deaerators, Economizers, Oxygen / Nitrogen Storage Tanks, Dished Ends, Centrifuges, Chlorine and
other allied Gas Cylinders and Expansion Bellows. The product was highly of a technical nature and
AEL was well-known in the market for its prompt response and good quality products. They had
developed import substitute products like rocket buster and spherical pressure vessels. AEL was into
direct marketing and customized services. It had served various industrial sectors and prominent
buyers like ISRO, BARC, IOCL, Kochi Refineries, HPCL, BPCL, British Oxygen, Inox India,
Kirloskar Pneumatic, Reliance Petro, IPCL, Ranbaxy, NTPC, HILL, Godrej, BHEL and J.K.
Industries.
Issues
Till 1993, the top management had 20% stake in AEL and they never took active interest in its
management. In comparison with other companies of Indian Business Group, it was very small.
Since inception, its products were highly technical in nature and AEL was well known in the market
for its prompt response and good quality products. They had also developed import substitute
products like rocket buster and spherical pressure vessels. For initial years, AEL made profits. Then
also, from 1985 to the year 2002, AEL was in trouble because sales declined continuously. During
those years, the company was making losses. It had been, therefore, registered as a sick unit by BIFR
(Board of Industrial and Financial Reconstruction) in the year 2001 under the provisions of the Sick
Industrial Companies (Special Provisions) Act, 1965. Other major issues were related to Human
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Resources. Conventionally, many workers joined through relations in the organization. There was no
performance measurement system for workers and managerial staff in the organization, which had
made them dull and lethargic. Moreover, there was no training program for labors to improve their
efficiency. The company needed to sharpen the skills of the workers. The competition had
intensified with big companies like laser and Toubro Ltd., ISAAC, Vadodara, GMM (Gujarat
Machinery Manufacturer), Vadodara, making their presence felt through their focused approach by
importing the manufacturing machineries from the developed countries. This made machineries of
AEL outdated. Moreover, many small fabricators also had ventured into this area. The research and
development in the company was always lop-sided. The company had never focused on reinvesting
in this area. Its capital investment in R & D was almost nil and recurring expenditure was only Rs.6
lakhs during the Year 2004-05. The profitable customers like, ISRO, BARC had already withdrawn.
Increase in prices of steel and other major raw materials, rise in other input costs, had squeezed
margins. Under tough competition and working capital shortage, the company had become almost
non-performing. The economic downfall, continued recession in the country and the world over had
further added fuel to the fire, making it difficult for the company to survive.
Steps taken by Management
As a measure towards labor problems, the management decided to give the option of Voluntary
Retirement Scheme (VRS) to all its employees. As a result, 278 labors and 34 staff members opted
for voluntary retirement under the VRS facilitating the company to decrease overheads to a large
extent. To fulfill the skilled workers were called back on a contractual basis. Since there was not any
performance measurement and incentive plan, AEL had to lose 3 to 4 good people to its competitors.
The company had now started the performance link bonus scheme wherein monetary benefit of 25
percent hike in the wages and salaries was given. It also started a training program, for its
contractual labors and appointed full time CEO from Arvind Mills. The company also hired a
consultant (who was an employee for more than 20 years at a senior level in Larsen & Toubro Ltd.)
for textile machinery and air handling system. It also made strategic alliances with few of the
renowned consultants, like, Engineers India Limited, Jacob H&G limited, UHDE India Limited,
Toyo Engineering Limited, Linde – West Germany, Monsanto – U.S.A., Kvaerner Powergas India
Limited, Tecnmont ICB India, Dalal Mott McDonald, Project Development India Limited, Chemtex
Engineering Ltd., Tata Consultant Engineers.AEL also developed in house R&D Laboratory –
approved by the Govt. of India and authorized to issue Certificate of Testing carries out. For this, it
imported technology for the manufacture of Industrial Centrifuges from West Germany and through
continuous interaction with R&D, company was able to fully absorb and adopt this technology. The
boost exports in developed countries like US, UK ad other European countries. With this quality
certification, the company felt that they had reaped the result in that very year by getting good orders
from HINDALCO and BHEL,. As a result, the profitability in 2004-05 reached an all time high.
PRESENT SCENARIO AND FUTURE PLAN
AEL’s turnover had reached the level of Rs. 34.4 crores, which helped them to recover all the debts.
The organizational structure was flat and there were no second line managers. Even the existing
managers were reluctant to pass the information and share their experiences with the new recruiters.
The image of AEL regarding the quality had to be reregistered in the minds of customers.AEL’s
short-term goal was to increase the turnover from current Rs. 34.3 crores to Rs. 150crores. The new
target was set Rs. 500 crores. And for this the management had identified new business divisions
like Textile Machineries, Air Handling System, Duplex Stainless Steel and Super Duplex Stainless
Steel, Aluminium and its alloys, Consulting Division Specialized in Power Plant and Waste water
Treatment and Non-conventional Energy System. Of which, textile machineries, power plan and airhandling
system would work as backward linkage to other companies of Indian business group. The
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management planned to convert the design department as an individual responsible profit centre, to
develop the designs for own business as well as providing consultancy to other businesses. Although
the CEO had a great pleasure in announcing that the company had reached a turnover of Rs. 34.4
crores but was a little bit apprehensive about the bumpy roads towards the Rs. 150 crores target.
1. If you were appointed as a CEO of AEL, Would you like to go for a separate design division?
2. Critically evaluate the future plans of AEL.
3. Do you think the target set by AEL was realistic? Comment.
4. Comment on the management strategies adopted by AEL.
Caselet 2
Alloys and Metals Pvt. Ltd., Indore was established by Kartik Jain in the year 2000, with the vision
to cater to the needs of the booming Steel Industry. The company started with the manufacturing of
Ingots – a steel product, which served as an input for production process in Hot Rolling Mills. The
manufacturing unit was situated at Pithampur, an industrial zone where the government offered
several incentives, rebates and subsidized electricity. Over 20 years of experience in steel trading
business prompted Kartik and his brother to invest their own capital to set up this unit. Later on, they
took financial assistance from Indian Overseas Bank. His brother supervised production at the
manufacturing unit whereas he concentrated on acquiring suppliers, marketing and distribution of
the product. Initially, when they entered into the business, the demand far exceeded the supply, and
this attracted those to enter the market. The manufacturing unit employed 150 workers; out of which
80 percent were on contract basis while the rest were wage holders. They worked in two shifts of
nine hours each, and the plant was shut down for six hours daily. The company had introduced a
number of innovative HR policies to keep motivation and morale of its workers high. They paid
overtime for extra hours put in by the employees. This considerably reduced employee absenteeism
and turnover. The company provided group insurance under the Employee State Insurance Scheme
(ESI) and all other safety measures for their benefits. The production capacity was 80 tones per day.
The company manufactured Ingots of various sizes (3”- 4”, 3.25” – 4.25”, 3.50” – 4.50”) as per the
requirement of the customers. The manufacturing unit was prone to accidents as the Ingots were
manufactured at temperatures as high as 17000c. Maintenance of such high temperature required
heavy power consumption and the expenditure on power was only approx. rs.50-60 Lakhs per
months. The company had also ser up a waste recycling plant at Pithampur as on an average 10
percent of the material was wasted. The recycled product was then further used as raw material.
Steel scrap, used to produce Ingots was purchased locally from Shree Gears Pvt. Ltd., Dewas Steel
India Ltd., Dewas, and T-Tee Industries Pvt. Ltd. Dewas. They also imported the same from various
countries like South Africa, Britain and Thailand. The firm had big cost disadvantage when it came
to procurement of raw materials. Due to the quality nature of the supplier base, the firm funds it
extremely difficult to maintain the quality and consistency of raw material. The finished product was
supplied to companies like Gowardhan Saria, Richa Steel;s Pvt. Ltd. and Shivam Ispact Pvt. Ltd.,
Indian Metal Industries (IMI), Indian Rolling Mills, Saathi Steels Pvt. Ltd., Central Steels Pvt. Ltd.
and Shivam Ispact Pvt. Ltd. and to other steel units in Rajasthan, Gujarat and Punjab. The
distribution channel of the company was not very complex. It was primarily through direct selling or
intermediate brokers in certain cases. The firm did not have a very well-developed marketing
department because of the fixed clientele. Ingot being a commodity product was quoted on the
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NCDX (National Commodities Exchange) and its rates varied between Rs. 1000-2000 per Ton.
Selling price was also dependent on the rates prevailing in Ghaziabad, Mandi Govindgarh, Raipur
and Calcutta as well as upon the various competitors’ rates prevailing in the market. Competition
was faced from Mayura Steels, Anand Steels, Sarkar Ispat, Shivani Estates Re-rolling Mills and
Sliver Ingots and other national manufacturers. The company used to purchase raw materials in cash
and kept at least 10 days of inventory. On the other hand, the company’s sale was mostly on credit,
with a time limit of 15-30 days. The company had a long list of defaulters – both buyers and sellers.
An incident involving a vendor who had defaulted with the supply of raw material was a matter of
growing concern for Kartik. A consignment due from Anna Enterprises, Thailand never reached
Alloys & Metals Pvt. Ltd., even though an advanced payment of $40,000 had been made at the time
of placing the order. The material was supposed to have arrived within 10 days, but in spite of
repeated reminders – telephone calls, fax and e-mails – delivery was not received even after a period
of two months. He then began to contact the person who had referred the particular supplier, but did
not get any satisfactory response from his end. He also contacted the Reserve Bank of India for
further course of action but he received no reply from them also. Being a member of the National
Steel Association, Mumbai he tried to seek their assistance for dealing with the matter but here also
he faced dejection. Neither the defaulters not the increasing competition deterred him from
visualizing a better future for the company. Disparity in demand and supply, increase in competition
and competitors’ diversification strategies, technological advances and the continuing boom in the
steel industry further motivated him to expand and diversify. In a period of two years, the company’s
turnover had reached over Rs. 45 crores. Encouraged by such a tremendous growth, Kartik was
planning to install a new Blast furnace to double its production capacity. As an initiative for future
development and expansion, they were also looking into the avenues of diversification into
manufacturing products like Channels, Angels and Rounds with plans to enter the retailing sector.
Now, he was at crossroads thinking whether and how to go about this diversification process.
1. As Kartik, what would have been your strategies to deal with the defaulters?
2. What steps should Kartik adopt before expansion and diversification? Would it be a wise decision
to diversify at this stage?
END OF SECTION B
Section C: Applied Theory (30 marks)
This section consists of Long Questions.
Answer all the questions.
Each question carries15 marks.
1. Strategic planning involves both, the development of organizational objectives and the
laying down of specifications about how they will be accomplished. In this context,
outline the major steps in the strategic planning process.
2. Implementing strategies effectively is of great importance. The success of a strategy
depends on how effectively it is implemented. Elucidate.
END OF SECTION C
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IIBM Institute of Business Management
Semester-II Examination Paper MM.100
Management Information Systems
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 & Part two questions carry 5 marks each.
Part one:
Multiple choices:
1. The BCD(binary code division) equivalent of (13)10 is
a. D
b. 1101
c. 00010010
d. 00010011
2. These systems are intended to help individual managers in their decision-making capability.
a. Management information
b. Executive support
c. Decision support
d. Office automation
3. Linux is a ……. Bit UNIX like operating system.
a. 16
b. 32
c. 64
d. 8
4. This is the ability of a system to repair itself, survive and grow by importing resources from its
environment and transforming them into outputs.
a. Negative entropy
b. Positive entropy
c. Entropy
d. Neutral entropy
5. A computer-based information system that increase the efficiency and productivity of
managers and office workers through document and message processing is known as
a. Decision support system
b. Management information system
c. Office automation system
d. Transaction processing system
6. Which is a multiuser operating system
a. MS DOS
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b. Windows NT
c. VMS
d. None
7. More information and knowledge is an advantage of this decision-making.
a. Individual
b. Strategic
c. Operational
d. Group
8. ISDN stands for
a. International service digital network
b. International service data network
c. Integrated service digital network
d. Integrated service data network
9. MYCIN is a popular expert system used for
a. Financial planning
b. Mineral exploration
c. Mass spectrography
d. Medical diagnosis
10. This refers to the flow of information among people on the same or similar organizational
level.
a. Diagonal
b. Upward
c. Horizontal
d. Downward
Part Two:
1. What are ‘Empirical systems’?
2. Write a note on ‘EPAB’.
3. Differentiate between interpreter and compiler.
4. What is ‘Virtual Reality’?
END OF SECTION A
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).
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Caselet 1
The Universal Foods and Drinks Limited (UFDL) is a company, manufacturing different
types of packaged foods and drinks. The product range consists of more than 50 items and 200
packaging units. The company’s products are popular throughout the country like Jammu &
Kashmir, Maharashtra, Karnataka and Kerala. It has a wide network of distributors and dealers,
who stock the UFDL products and deal with all types of customers. The company through its
network reaches to over 50,000 retail points. Some of the products of the UFDL are produced
throughout the year and are sold through this wide network. Some products are seasonal in
production but are sold throughout the years. And some products are popular in certain seasons and
not in demand at all in the other seasons. The business performance of the company is assured well,
if the UFDL produces the products as per the varying demand pattern of the customers. Since, the
company has established its strength in the distributor dealer network, the success comes through
the appropriate decisions in the purchase of fruits, vegetables, cereals, and pulses and putting them
through processing and packaging, and dispatching them to various locations where the distributors
are located. It is the policy of the company to launch each year at least one new product in the
country. This policy has paid rich dividends, to the company in terms of its image and the
customers have always looked forward for such an announcement from the company’s end. The
UFDL uses, well in advance, the different advertising media such as the newspapers, hoardings,
magazines, sample tests and demos, T.V. etc for announcing and promotion of its new products
from time to time. However, the selection of media is based on the product and its overall position
in the product range and the targeted market segment. In spite of considerable strength in many
aspect of business, the company has failed in the launching of new products. It was also not able to
meet the demand owing to the inadequate purchases of raw-materials, the wastage of the rawmaterials
as the processing plant of the company was not available due to its maintenance schedule
or it was scheduled for some other food processing operation. The company also faces the problems
of high seasonal inventory which, if not disposed of in time, becomes a non-moving and sometimes
a non-saleable inventory. The UFDL has its Marketing Division headed by a Manager- Marketing
supported by the product Manager for a group of its products.
1. Suggest the different Decision Support System (DSS) which the management of the UFDL may
use for strategic management of the business.
2. Suggest the external sources of information for the top management to support their decisionmaking,
justifying its position in an MIS.
Caselet 2
There’s nothing like a punchy headline to get an article some attention. A recent piece in the
Harvard Business Review (May 2003), shocking labeled “IT Doesn’t Matter,” has garnered the
magazine more buzz than at any time since the Jack Welch affair. The article has been approvingly
cited in The New York Times, analyzed in Wall Street reports, and e-mailed around the world. But
with out such a dramatic and reckless title, I doubt the article would have been much noticed. It’s a
sloppy mix of ersatz history, conventional, moderate insight, and unsupportable assertions. And it is
dangerously wrong. Author Nicholas Carr’s main point is that information technology is nothing
more than the infrastructure of modern business, similar to railroads, electricity, or the internal
combustion engineering advances that have become too commonplace for any company to wangle a
strategic advantage from them. Once innovative applications of information technology have now
become merely a necessary cost. Thus Carr thinks today’s main risk is not under using IT but
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overspending on it. But before we get any further, let’s have a reality check. First, let’s ask Jeff
Immelt, the CEO of General Electric Co., one of the premier business corporations in the world,
this question: “How important is information technology to GE?” Here’s his answer: “it’s a
business imperative. We’re primarily a service-oriented company, and the lifeblood for productivity
is more about tech than it is about investing in plants and equipments. We tend to get a 20 percent
return on tech investments, and we tend to invest about $2.5 billion to $3 billion a year.hen let’s ask
Dell Corporation CEO, Michael Dell: “What’s your take on Nick Carr’s thesis that technology no
longer gives corporate buyers a competitive advantage?” Here’s His answer: “Just about anything
in business can be either a sinkhole or a competitive advantage if you do it really, really bad or you
do it really, really well. And information technology is an often misunderstood field. You’ve got a
lot of people who don’t do it very well. For us, It is a huge advantage. For Wal Mart, GE, and many
other companies, technology is a huge advantage and will continue to be. Does that mean that you
just pour money in and gold comes out? No, you can screw it up really bad. Finally, let’s ask Andy
Grove, former CEO and now Chairman of Intel Corporation, a direct question about IT: “ Nicholas
Carr’s recent Harvard Business Review article says: ‘IT doesn’t Matter.’ Is information technology
so pervasive that it no longer offers companies a competitive advantage?” Andy says: “In any field,
you can find segments that are close to maturation and draw a conclusion that the field is
homogeneous. Carr is saying commercial- transaction processing in the United States and some
parts of Europe has reached the top parts of an S-Curve. But instead of talking about that segment,
he put a provocative spin on it- that information technology doesn’t matter – and suddenly the
statement is grossly wrong. It couldn’t b further from the truth. It’s like saying: I have an old threespeed
bike, and Lance Armstrong has a bike. So why should he have a competitive advantage?”So,
basically, Carr misunderstands what information technology is. He thinks it’s as merely a bunch of
networks and computers. He notes, properly, that the price of those has plummeted and that
companies bought way too much in recent years. He’s also right that the hardware infrastructure of
business is rapidly become commoditized and, even more important, standardized. Computers and
networks per se are just infrastructure. However, one of the article’s most glaring flaws is its
complete disregard for the centrality of software and the fact that human knowledge or for
information can be medicated and managed by software. Charles Fitzgerald, Microsoft’s general
manager for platform strategy, says that Carr doesn’t put enough emphasis on the “I” in IT. “The
source of competitive advantage in business is what you do with the information that technology
gives you access to. How do you apply that to some particular business problem? To say IT doesn’t
matter is tantamount to saying that companies have enough information about their operations,
customers, and employees. I have never heard a company make such a claim.”Paul Strassman who
has spent 42 years as a CIO-at General foods, Xerox, the Pentagon, and most recently NASA was
more emphatic. “The hardware—the staff everybody, is fascinated with- isn’t worth a damn,” he
says. It’s just disposable. Information technology today is knowledge –capital issue. It’s basically a
huge amount of labor and software.” Says he: “Look at the business powers- most of all Wal-Mart,
but also companies like Pfizer or FedEx. They’re all waging information warfare.”
1. Do you agree with the argument made by the business leaders in this case in support of the
competitive advantage that IT can provide to a business? Why or why not?
2. What are several ways that IT could provide a competitive advantage to a business? Use some of
the companies mentioned in this case as examples. Visit their websites to gather more
information to help you answer.
END OF SECTION B
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Section C: Applied Theory (30 marks)
This section consists of Long Questions, answer all the questions.
Each question carries 15 marks.
1. Shells Company has adopted a new management information system (MIS) in its Chennai
branch. Though the MIS promised rich benefits, Shells’ employees were quite apprehensive
about the new change and resisted this recent move of the company. Can you suggest some
measures or techniques for overcoming resistance to change at Shells?
2. A key element in both planning and controlling is information. What are the main attributes
that information must possess in order to be useful to managers? And is the nature of the
information required by managers at different levels similar or does it varies along with the
hierarchy?
END OF SECTION C
Examination Paper: Human Resource Management
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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
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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
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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
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?
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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
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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
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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
(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
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