Management & Change

Management & Change The Journal of the Institute for Integrated Learning in Management (IILM), New Delhi Editor Dr. Irfan A. Rizvi iarizvi@jilm.edu EDITORIAL Agrawal

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Ahmed

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Chatterjee

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f Management,

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BOARD

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J. D.

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Gyorgy

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and

---------------~---------------= JOOffi]]lffif£@I]]l@J]l'U ~

CCIIDffiIIDf£@ ••

~

I

Dennis P. Heaton

Chinmaya S. Rathore

Harmonizing Stability and Change Enlivening Creative Intelligence

by

Business Geographies: Providing the Spatial Dimension to Business Information Systems

Vathsala M. Akuratiyagamage

Management Development: The Total Process Embracing Informal and Formal Processes

Riyaz Rainaye

Training Effectiveness in Public Sector and Private Sector Commercial Banl<s: A Microlevel Comparative Study

Dilip Roy and Saikat Banerjee Mirza S. Saiyadain, Zolzaya Demberel & Marian Murerwa

Important Factors for Strategy Formulation in Fan Industry: View of Decision-makers Demographic Variables and Job Satisfaction amongst Mongolian and Ugandan Employees

Management & Change VOLUME

8

NUMBER

2004

1 &2

ARTICLES

1

Harmonizing Stability and Change

by Enlivening Creative Intelligence

Dennis P. Heaton

Business Geographics~ Providing the Spatial Dimension to Business Information Systems

Chin maya S. Rathore

19

Management Development: The Total Process Embracing Informal and Formal Processes

Vathsala M. Akuratiyagamage

31

Training Effectiveness in Public Sector and Private Sector Commercial Banks: A Micro-level Comparative Study

Riyaz Rainaye

49

Important Factors for Strategy Formulation in Fan Industry: View of Decision-makers

Dilip Roy and Saikat Banerjee

69

Demographic Variables and Job Satisfaction amongst Mongolian and Ugandan Employees

Mirza S. Saiyadain, Zolzaya Demberel and Marian Murerwa

91

BOOK REVIEWS

107

V.V.Sople, Legal Aspects of Marketing in India. Reviewed by Dr. Deepankar Mukherjee.

Jerome Joseph, Industrial Relations. Reviewed by Prof. V. R. Murali Mohan.

Ruma Ghosh Singh, Nikhil Raj and Helen R. Sekar, Hard Labour at a Tender Age. Reviewed

by Devashis Rath.

C.ont r ibu t o.rs Dennis P. Heaton

Professor, Maharishi University Management, Fairfield, Iowa, USA

Chin maya S. Rathore

Associate Professor, Indian Institute of Forest Management, Bhopal

Vathsala M. Akuratiyagamage

Senior Lecturer, Department of Management of Technology, University of Moratuwa, Sri Lanka

Riyaz Rainaye

Senior Lecturer, Department Commerce, University of Kashmir

Dilip Roy

Professor, Department of Business Administration, University of Burdwan

Saikat Banerjee

Assistant Professor, Bengal College of Engineering and Technology-Institute of Management, Durgapur

Mirza S. Saiyadain

Distinguished Professor, Institute for Integrated Learning in Management, Lodhi Road, New Delhi

Zolzaya Demberel

Snlife (M) Company Ltd. UIaanbaatar (Mongolia)

Marian Murerwa

Cell-Pic (U), Kampala (Uganda)

of

of

HARMONIZING STABILITY AND CHANGE ENLIVENING CREATIVE INTELLIGENCE

BY

Dennis P. Heaton As managers attempt to introduce organizational change at an accelerating pace, it becomes increasingly difficult to locate the stability that individuals and organizations need in order to be adaptive. Finding deeper sources of stability permits a greater range of adaptability to be available.

Experience of the unchanging transcendental core of one's being can provide unshakable stability, open the mind to expanded possibilities, develop alertness to dynamically move toward creative progress, and attune individual action to the holistic patterns of orderly progress in nature.

Research on the Transcendental Meditation technique suggests that systematic experience of Transcendental Consciousness simultaneously develops five qualities of creative intelligence which are fundamental to progress: adaptability, stability, purification, integration, and growth. Enlivenment of creative intelligence shifts the paradigm of change from the notion that resistance to change is natural to the realiZfltionthat evolution and growth are the nature of life.

THE STRESSFUL IMPACT OF CONSTANT CHANGE

G

lobalization of markets, technological innovations, and changing worker demographics are among the forces pressuring organi zations to make changes in their structure, processes, and culture (Weisbord, 1987). Competition often does require faster product development cycles and compresses the time of product life cycles. Many perceive that the pace of change is accelerating (Zorn, Christensen & Cheney, 1999; Russell, 1998). VaiIl (1989, p. I), for example, has characterized the business environment as "permanent white water." Peters (1976, 1984) writes about conditions of continual chaos and a "nanosecond" pace of change.

In response to this perceived need for change, organizational managers may repeatedly introduce programmatic attempts to bring about or-

Management.& ~

2004 Institute

Change,

Volume 8, Number

for Integrated

Learning

1 & 2 (2004)

in Management.

All Rights Reserved.

2 Harmonizing Stability and Change by Enlivening Creative

ganizational transformation. TQM, BPR, mergers, outsourcing, e-commerce, and other "flavor of the month" change initiatives (Zorn et aI., 1999, p. 31) are often thrust upon organizational members in an unending succession, resulting in cynicism and confusion. Too often these change initiatives fizzle without achieving the improvements they had aimed for. Indeed, some report that the rate of failure of major corporate change initiatives is as high as 80% (McMaster, 1996). Moreover, each change programme may push the organization in fragmented and uncoordinated directions. As more and more things change, in the words of the poet Yeats, "Things fall apart. The center does not hold" (1986,

p. 1948).

The acceleration of change around the world is having the effect of eroding the traditions and values that give meaning to individual life and continuity to culture. The hectic pace of change can be a source of psychological and physiological stress for managers and organizational members. Russell (1998, p. 4) argues that "the pace of life is getting faster and faster, taking us ever deeper into what Alvin Toffler called Future Shock ... the shattering stress and disorientation that we induce in individuals by subjecting them to too much change in too short a time."

A vicious cycle ensues: stress reduces the capacity to adapt to change, which leads to increasing stress, which further reduces the capacity to make the very changes that may be needed for survival.

SEARCHING FOR STABILITY TO BALANCE CHANGE Zorn et al. (1999) observe that organizations are changing so much that it is difficult for "members to feel a sense of stability, especially when the changes in question do not follow logically or organically from established missions and strategic plans" (p. 13-14). While recognizing that change is essential, these authors call for an increased balance of change with stability. Change and stability, they note, are interdependent: "Stability is what allows organizations and people to be flexible" (Zorn, et aI., p. 14). As an example of stability in organiz3tions they point to the core values/mission that help maintain a "sense of coherence and identity" (Zorn, et aI., p. 14).

Stability provides the basis for adaptability, and the deeper one's source of stability is, the greater is the range of one's adaptability. In organizations, stability can be set on the superficial level of established tasks Management & Change. Volume 8. Numher 1 & 2 (2004)

Heaton 3

'1

and procedures, in which case the organization may behave as a rigid bureaucracy. Or stability can be located on the somewhat deeper level 0f the objectives of the tasks, in which case a wider range of means of accomplishing those objectives may be available. Still deeper, stability may .reside in a set of abiding superordinate values which enable the organization to maintain coherence and integrity over a long span of time (Collins & Porras, 1997).

Still deeper than organizational values can be experience of the transcendental aspect of life, which Russell (1998, p. 114) describes as "the unchanging, permanent core of my being." Realization of this transcendental Self, according to Dyer (1996), can be the key to gaining inner freedom and breaking old habits.

Without experience of this transcendental dimension, one is continuously overshadowed by objects of experience; one has only a conceptual identity about oneself in terms of objects of experience (Chandler, 1991), such as "1 am the manager of the XYZ division." As Russell observes: Most of us derive a sense of self from our experience and interaction with the world ... such an identity is forever vulnerable. It has no pennanent foundation and is continually at the mercy of events (1998, p. 61).

When one is identified with something that the organization can change, such as one's role or position, then one's identity can be threatened by change (Tannenbaum & Hanna, 1985). But, if one becomes established in the realization of an inherent transcendental Self that is not dependent on outer circumstances, change is no longer a source of threat or anxiety.

THE STABLE SELF IN TRANSCENDENTAL CONSCIOUSNESS Meditation, Russell explains, is a means to turn attention inward, toward "the source of my experience" (1998, p. 114), that is otherwise difficult to locate. The Transcendental Meditationii (TMii) technique is a systematic procedure that allows the individual to quietly know the transcendental foundation of experience in: A state of inner wakefulness with no object of thought or perception, just pure consciousness aware of its own unbounded nature. It is wholeness, aware of itself, devoid of differences, beyond the division Management & Change. Volume 8, Number I & 2 (2004)

4 Harmonizing Stability and Change by Enlivening Creative

of subject and object - Transcendental Consciousness. It is a field of all possibilities, where all creative potentialities exist together .. . but as yet unexpressed. It is a state of perfect order, the matrix from which all the laws of nature emerge, the source of creative intelligence (Maharishi Mahesh Yogi, 1976, p. 123).

The Transcendental Meditationa programme was introduced by Maharishi Mahesh Yogi in 1957, and has since been learned by more than five million people (Roth, 1987). The TM technique is the most thoroughly researched meditation practice in the world today (Murphy & Donovan, 1996). This technique is described as a natural, effortless, and enjoyable procedure that is practiced for 20 minutes twice a day, sitting comfortably in a chair with eyes closed. This practice allows active awareness to gradually settle down so that the silent, unbounded, and unified state of Transcendental Consciousness can be directly experienced. Transcendental Consciousness is a state of restful alertness that can be distinguished physiologically and phenomenologically from the aroused alertness characteristic of the waking state and from the more inert states of dreaming and sleeping (Travis & Wallace, 1999). The settling down of the mind during the transcending process allows the body to gain profound relaxation, which dissolves the stresses blocking the expression of inherent potential. The deep rest and expanded alertness experienced during this procedure establish a basis for dynamic and effective action.

EXPERIENCE OF TRANSCENDENCE OPENNESS TO CHANGE

CULTIVATES

Transcendental Consciousness, being beyond conceptual boundaries, is the ultimate foundation of stability and at the same time it is a field of all possibilities from where awareness can take any direction. Marcus has noted that the TM technique is a means of cultivating greater openness to change: experience of Transcendental Consciousness through the TM technique provides "a perfectly stable state, a non-changing reference point that allows for better appreciation of the changing nature of all other things" (Marcus, 1977, p. 76). The repeated experience of shifting awareness from the boundaries of specific thoughts to unbounded Transcendental Consciousness in meditation cultures the ability to maintain a broadened and relaxed frame of mind.

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Heaton 5 Transcendental Consciousness is a state of self-sufficiency and unshakability in the awareness of simple Being. Growing familiarity with this state of consciousness shifts one's source of identity and security from external, relative, changing aspects of one's life-such as one's role or one's possessions, to the self-validating experience of one's Transcendental Consciousness. One becomes, in the words of the Bhagavad-Gita (IIA5): "independent of possessions, ever firm in purity, possessed of the Self."

Evidence of how practice of the Transcendental Meditation technique cultivates openness to change can be seen in Schmidt-Wilk's report of how a Swedish executive reacted to a major reorganization: This is a little bit bothersome for many, but I don't experience it as such. When you change jobs it can be a little bit nerve-wracking. But I think it worked very well. I am surprised myself. I have been able to take it easy and relax (1996, p. 248).

This executive also noted: "I am not so stuck in old (previously learned) patterns. I have a fresher perspective on things (p. 248)."

On a similar theme, Heaton and Harung (2001) have pointed out that post-conventional ego development, found in long-term practitioners of the TM technique, implies an ability to orient themselves from a lively inner awareness, rather than from familiar patterns of thought and behavior.

This awareness makes them better able to adapt and learn in the complex, fast-changing, and ambiguous situations that characterize today's international business scene. Evidence of such development may be seen in the following quotation from Gustavsson's study of executives practicing the TM programmeme: My conception of the world has changed, something I did not expect.

Things which were solid reference points before don't seem so solid anymore .... In the beginning it meant a certain chaos, but now I have got used to questioning things which others take for granted. (1992, p.

320)

QUALITIES OF CREATIVE INTELLIGENCE ENLIVENED THROUGH THE TM PROGRAMME-THE FIVE FUNDAMENTALS OF PROGRESS According to the theory of the Science of Creative of Intelligence (SCI) (Maharishi Mahesh Yogi, 1972), experience of Transcendental ConsciousManagement

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----------

ness promotes the development of qualities of creative intelligence-such as integrative and progressive-which operate in all natural systems. The progressive quality of creative intelligence is seen in the natural tendency of life to grow and systems to continuously evolve toward higher development. The integrative quality puts parts together to form a greater whole. It holds together the unity of diversity that makes the 'uni-verse'.

It integrates opposite values, such as ever-changing dynamism and eversteady silence, in cosmic life and in the life of the individual. Repeated experience of transcendence through the TM technique enlivens the progressive nature of life and simultaneously strengthens the integrating quality necessary to support continuous progress and expansion. This enlivenment of creative intelligence enables individuals to become more creative day by day in order to meet the demands of the rapid pace of progress.

SCI, through its practical aspect-the TM technique, is said to develop five fundamentals of progress that coexist in natural systems: stability, adaptability, integration, purification, and growth (Maharishi Mahesh Yogi, 1978). Maharishi explains that by virtue of the quality of stability, change influences from outside are not able to overthrow the integrity of the system. An influence from outside will be spontaneously purified, so that the / system will naturally adapt to and integrate what will be useful to its growth. Development of these five fundamentals in the psychology and physiology of individuals, and through them into the organizations and societies they form, can harmonize "the ever-changing nature of progress with the non-changing nature of culture" (Maharishi Mahesh Yogi, 1978, p. 319).

The Science of Creative Intelligence is called a science because its concepts are open to verification through intellectual analysis, experimental investigation, and subjective experience. SCI's five fundamentals of progress-stability, adaptability, purification, integration, and growth-provide a theoretical framework for organizing research on the effects of the TM technique on the mind, body, behavior and environment (World Plan Executive Council, 1974). Selected findings on each of these five qualities are reviewed below. These research findings not only provide evidence of the efficacy of the TM technique for human resource development, they also provide empirical support for SCI's conceptual perspective.

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, Stability One indicator of growing stability is reduction of trait anxiety resulting from practice of the TM technique. A statistical meta-analysis of 146 independent outcomes (Eppley, Abrams, & Shear, 1989) found that the TM programmeme produced 3 times the effect size of other meditation and relaxation techniques, controlling for frequency of practice. Physiological indicators of growing stability of the nervous system, even outside of meditation, include lower levels of spontaneous skin resistance responses, lower respiration and breath rates, and lower blood lactate (Dillbeck & Orme-Johnson, 1987). High levels of blood lactate have been associated with high anxiety and with high blood pressure. Another indicator of growing stability is field independence, the ability to perceive specific objects without being distracted by the environment of the objects. (Pelletier, 1974).

Herriott (1999) has reported qualitative evidence of profound psychological stability in 16 entrepreneurs who were long-term practitioners of the TM programmeme. Using a grounded theory approach, her interview data yielded a set of qualities that included "Unshakability." The following excerpt from Herriott's dissertation summarizes responses to questions about the subject's own experience of personal development through the TM programmeme: Inner Stability, keeping a broad Perspective, and a capacity for mental and emotional Renewal appeared to be the resources interviewees most often drew upon in dealing with pressure. These qualities were summed up by the word Unshakability, implying an ability to stay calm and un~ affected in the face of even chaotic circumstances (p. 114).

Based on subject responses, Herriott concluded:

The qualities in the Unshakability cluster all appeared to be linked to the experience of a deeper inner reality, which was variously described as a sense of inner fullness, as an inner sense of security, as a feeling of being anchored to something deeper, an inner silence, or as happiness (p. 138).

Adaptability Other research indicates that the TM technique also enlivens adaptabilManagement

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8 Harmonizing Stability and Change by Enlivening Creative. ity. Orme-Johnson (1987) found physiological evidence that TM practitioners recover from stressful stimuli more quickly, as indicated by faster habituation of galvanic skin responses. Other findings include improvements in creative thinking (Travis, 1979), fluid intelligence, constructive thinking, and reaction time (Cranson, Orme-Johnson, Gackenbach, Dillbeck, Jones, & Alexander, 1991; Dillbeck, Assimakis, Raimondi, Orme-Johnson & Rowe, 1986).

Purification The qualities of stability and adaptability provide resilience to resist stress, and enable the physiology of the individual to purify itself of imbalances.

In randomized clinical trials, the practice of TM has produced improvements in specific stress-related health problems such as hypertension (Schneider, Staggers, et aI., 1995) and atherosclerosis (Castillo-Richmond, Schneider, et aI., 2000). Practice of the TM programme has also been associated with reduced health insurance utilization (Orme-Johnson, 1987; Herron, Hillis, Mandarino, Orme-Johnson, & Walton, 1996; Orme-Johnson & Herron, 1997; Herron & Hillis, 2000). In business settings, the practice has produced improved mental and physical health, productivity and interpersonal relations, and reduced alcohol consumption (Alexander, Swanson, Rainforth, Carlisle, Todd, & Oates, 1993; Haratani & Henmi, 1990; DeArmond, 1996).

Integration The quality of integration manifests in increased synchronization of electrical activity between different parts of the brain, which correlates with improved H-reflex recovery, concept learning, and moral development (Nidich, Ryncarz, Abrams, Orme-Johnson, & Wallace, 1983; Dillbeck, M. C., Orme-Johnson, D. w., & Wallace, R. K. (1981). Practice of the TM technique has also been seen to improve mind-body coordination, as measured by a choice reaction time test (Cranson, et ai, 1991).

Integration is evident in Herriott's (1991) finding of "Attunement to a Greater Wholeness," which she describes as "an awareness of a more holistic, all encompassing level of truth and reality, as a sense of integration of the inner and outer dimensions of life" (p. 168). As a consequence of feeling a deep sense of connectedness, entrepreneurs adopted "more universal values," going beyond individual interests to the wider Management

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interests of employees, community, or environment as a whole" (p. 172).

One way in which this attunement manifested in Herriott's interview data was in subjects' descriptions of "being in the right place at the right time ... (in) alignment with the evolutionary flow of the universe" (p. 1645). Herriott reported, "Many interviewees noted that synchronicity, in the form of lucky breaks or happy coincidences, played a role in the unfoldment of their career or business" (p. 165). Her subjects reported an association between instances of things "organizing themselves" and feelings of settledness (inner silence, lack of rush or strain).

Growth A variety of studies on development of personality, intelligence, and performance can be interpreted as evidence of that the TM technique enlivens the qual ity of growth. A statistical meta-analysis by Alexander, Rainforth, and Gelderloos (1991) found that the TM programmeme produced twice the effect size of other meditation and relaxation techniques in growth of self-actualization (Alexander, Rainforth, & Gelderloos, 1991).

According to Maslow (1968), self-actualized individuals have increased acceptance of self, of others, and of nature; more confidence and positive philosophy about life;, spontaneity and creativity in thought and behavior; and concern with higher-order human values such as truth, beauty, and justice.

Another major study of personality development through th(f TM technique was conducted by Chandler (1991). This study used three convergent measures to look at the long-term effects of meditation practice in a 10-year longitudinal study. The findings were that TM practitioers grew in intimacy motivation (a measure of positive, caring emotions), principled moral reasoning, and ego development. The measure of ego development is itself considered an indicator of holistic psychological maturity, encompassing self-concept, intellectual analysis and synthesis, and interpersonal relations (Loevinger, 1976).

A milestone in ego development is when the individual becomes postconventional-able to think and act independent of the collective mentality of his surrounding social system. Chandler found that at post-test 53% of the TM subjects achieved post-conventional levels of development at posttest, compared to less than seen 10% in the control group and in most other samples of adult subjects. In fact, the meditating group achieved Management

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the highest proportion of post-conventional ego development yet recorded among adolescent and adult samples-including Harvard University alumni and senior management samples.

So Kam-Tim (1995) investigated the development of holistic intelligence through the Transcendental Meditation programmeme in 3 randomized, blind, controlled studies (6-12 months) conducted with 353 Chinese students. He found that practice of the TM technique developed significantly greater creativity, practical intelligence, reduced anxiety, neural efficiency, and field independence-all of which are indicators of intelligence in the body, mind, and behavior.

The quality of growth has also been seen in performance in company settings: TM practice has been associated with increased efficiency and productivity, increased job satisfaction, and increased sales and income (Frew, 1974; see review in Schmidt- Wilk, Alexander, & Swanson, 1996).

CREATIVE INTELLIGENCE GIVES AN EVOLUTIONARY DIRECTION TO CHANGE Because the need for progressive change is increasing, so is the need to draw deeply from the wellspring of creative intelligence, which is both progressive and integrative. Evidence suggests that managers practicing the Transcendental Meditation technique experience intuitive insights that are entrepreneurially creative. These same managers also report that their creativity entails a sense of integration of thoughts and events as part of a greater whole (Herriott, 1999).

Gustavsson (1992) observed growth of integrative, big picture thinking in a management team in which most of the members practiced the TM technique. The theory of SCI would explain this integrative thinking as an expression of the intelligence of natural law which automatically maintains "the well-coordinated relationship of everything in the cosmos with everything else" (Maharishi Mahesh Yogi, 1995a, p. 8). Nature exhibits holistic patterns of progressive change, so that change in one element does not create life-damaging influences-pollution-in other parts of the whole. Maharishi explains that: Each area of infinite variety in creation always expands but does not create pollution, because in this theme of evolution in Nature, the part is always well connected with the whole, so that the total organizing power

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of Natural Law is persistently available to every stage of evolution of everything (1994, p. 299).

Wheatley too has observed the holistic connectedness in natural systems, which she explains in terms of self-reference: Instead of whirling off in diffetent directions, each part of the system must remain consistent with itself and with all other parts of the system as it changes. There is, even among simple cells, an unerring recognition of the intent of the system, a deep relationship between individual activity and the whole (p. 146).

In her discussion of change in a self-evolving system Wheatley notes, "As it changes, it does so by referring to itself; whatever future form it takes will be consistent with ... what has gone on before ... The system, in Jantsch's (1980, p. 1) terms, keeps the memory of its own evolutionary path" (Wheatley, 1992, p. 94). Wheatley speculates that the principle of self-reference may be the one unifying principle on which to base management practice: "It conjures up a different view of management and promises solutions to so many of the dilemmas that plague us: control, motivation, ethics, values, change" (1992, p. 46; see also p. 147).

Interestingly, the principle of self-reference as discussed in Wheatley (1992) resembles Maharishi's (1994) explanation that Transcendental Consciousness is self-referral; this state in which pure creative intelligence has nothing to refer to but itself is the Unified Field of Natural Law underlying and interconnecting all the phenomena of the natural world. In Maharishi's analysis, the TM programme attunes individual intelligence with this universal field of cosmic intelligence so that management can become "as automatic, problem-free and ever progressive, and ever evolutionary as the administration of the universe through Natural Law" (Maharishi Mahesh Yogi, 1995, p. 8). When the waking mind is able to operate from that level which is the common basis of the individual mind and the external environment, individual decisions are expected to be more holistic, more useful for all parties involved. Thinking and action become more coordinated, simple, economical, and evolutionary, like the action of nature. This theory fits with Maslow's (1971, pp.

280-281) observation that subjects who have had experiences of transcendence naturally create greater order, simplicity, and quality.

Theorists and practitioners seek to take a whole-systems approach to organizational change management (Senge, 1994; Chin, 1976). But though in theory we may try to comprehend and intervene in whole Management

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systems, the complexity of interrelated elements cannot be mastered through intellectual analysis alone. The National Research Council has observed that change interventions fai I because of the systemic character of organizations: Changing a single aspect of an organization almost never results in a substantial change in organizational performance. Organizations are too complex, their performance too multi-determined, and their inertia too great for a single innovation at the individual level to have a substantial impact on organizational performance (National Research Council, 1994, p. 6).

SCI offers the unique and simplifying approach of finding wholeness, not in the complex details of all the parts and their relationships, but very simply in the experience of the holistic creative intelligence available in one's own Transcendental Consciousness. By developing a intuitive attunement with a greater whole, the approach of enlivening creative intelligence through the Transcendental Meditation technique can help fulfill the requirement that "to achieve organization-wide improvements, many factors must change simultaneously" (National Research Council, 1994, p. 147).

NEW PARADIGM POSSIBILITIES FOR ORGANIZATIONAL CHANGE MANAGEMENT

BY ENLIVENING CREATIVE INTELLIGENCE Table-I contrasts some of the challenges faced by contemporary organizational change practitioners to new possibilities for organizational change management suggested by the theory and practice of the Science of Creative Intelligence.

The conventional wisdom in the management literature has it that "resistance to change is natural" (Matejka & Julian, 1993, p. 10). Similarly, Lussier (2000, p. 223) notes "Most change programmes fail because of employee resistance." A Harvard Business Review article uses the following quote from Machiavelli to emphasize the difficulty of finding acceptance for change: "It must be considered that there is nothing more difficult to carry out, nor more doubtful of success, nor more dangerous to handle than to initiate a new order of things" (quoted in Kotter & Schleshinger, 1979, p. 106).

On the other hand, an entirely opposite paradigm about change can be Management & Change, Volume 8. Number I & 2 (2004)

Heaton Contemporary

Challenges

New Paradigm

13

Possibilities

Change is difficult to achieve (Kotter & Schlesinger, 1979).

Evolutionary change is natural and spontaneous (Maharishi Mahesh Yogi, 1972, 1995).

Organizational members resist change because they fear loss of security and identity (Matejka & Julian,1993; Hanna & Tannenbaum, 1985; Lussier, 2000)

Organizational members who know their transcendental Self are secure in themselves and open to evolutionary change (Marcus, 1977; Schmidt-Wilk, 1996).

Too much change, too quickly, is overwhelming the stability that can enable organizations and individuals to be flexible (Zorn, Christensen & Cheney, 1999; Russell, 1998).

Stability is the basis of adaptability.

The qualities of stability, adaptability, purification and growth are all enlivened by the Transcendental Meditation programme. (Maharishi Mahesh Yogi, 1972, 1978).

Organizations attempt to adopt and implement multitudinous change programmes but may achieve fragmentation and limited results (McMaster, 1996; National Research Council, 1994).

Gaining experience of one single element -the self-referral state of Transcendental Consciousnesseffectively promotes holistic, evolutionary change (Maharishi Mahesh Yogi, 1994, 1995).

Planned change lacks unified theories of organizations and organizational change (Porras and Silvers 1991, p. 51); management can learn from the patterns of nature found by 'new sciences' (Wheatley, 1992).

The Science of Creative provides a general science of transformationunifying principles for understanding the processes of change studied in various disciplines (Maharishi Mahesh Yogi, 1994, 1972).

seen in the observation by Maharishi Mahesh Yogi that "Progress, evolution, growth, are the nature of life" (1972, p. 1.3). Is change difficult and dangerous, as portrayed by Machiavelli? Or is change the natural and spontaneous flow of life towards greater happiness, as posited in the Science of Creative Intelligence? Both views depict reality as it is experienced, according to the consciousness of the viewer. Change can be experienced with anxiety and managed with struggle; or change can be experienced with equanimity and managed with ease, depending on the degree to which the conscious capacity of the mind has expanded to utilize its inherent potential of creative intelligence.

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The Science of Creative Intelligence provides a theoretical perspective about the nature of change, which can expand current behavioral science thinking. Porras and Silvers pointed out, "Planned change that makes organizations more responsive to environmental shifts should be guided by generally accepted and unified theories of organizations and organizational change, neither of which currently exists" (1991, p. 51). SCI presents deep principles about change and stability that have applicability across multiple disciples. SCI's concept of five fundamentals of progress, for example, can be applied to physiology, ecology, psychology, management, sociology, cultural studies, and engineering disciplines.

Like the work of Wheatley (1992), SCI connects the discipline of management to deep laws of nature that are seen in physical and life sciences. As Wheatley reports, scientists such as Prigogine and Stengers (1984) understand that systems in nature reliably and spontaneously organize and evolve themselves. New paradigm thinkers in management, such as Willis Hannan and Michael Ray, have recognized the value of opening human awareness to the organizing intelligence of nature.

Harman (1988, p. 119) articulated the outlook of deep ecology, which "goes beyond the contemporary scientific framework to a subtle awareness of the oneness of all life, the interdependence of its multiple manifestations." Ray has presented a new vision of "doing business from our most profound inner awareness and in connection with the consciousness of others and the earth" (1993, pp. 4-5).

SCI offers a subjective, experiential approach to gaining of the benefit of the holistic and evolutionary qualities of creative intelligence in the ways one thinks and acts. This enlivenment of creative intelligence enables change managers to find unshakable stability in the transcendental field of pure creative intelligence opens their minds to expanded possibilities, develops their alertness to dynamically move toward creative progress, and spontaneously guides their change efforts in a positive and holistic direction.

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Personality, 6 (5): 189-247.

Alexander, C. N., Swanson, G. c., Rainforth, M. v., Carlisle, T. W, Todd, C. c., & Oates, R. (1993) "Effects of the Transcendental Meditation Programme on Stress-Reduction, Health, and Employee Development: A prospective study in two occupational settings," Anxiety, Stress, and Coping, 6, 245-262.

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Chandler, H. M. (1991) "Transcendental Meditation and Awakening Wisdom: A 10-Year Longitudinal Study of Self Development," Dissertation Abstracts International, 51 (1 DB): 5048.

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The Planning of Change, Third edition. New York: Holt, Rhinehart, and Winston.

Collins, 1. and Porras, J. (1997). Built to Last: Successful Habits of Visionary Companies. New York: HarperCollins.

Cranson, R. W., Orme-Johnson, D. W., Gackenbach, 1., Dillbeck, M. c., Jones, C. H., & Alexander, C. N. (1991). "Transcendental Meditation and Improved Performance on Intelligence-Related Measures: A Longitudinal Study." Journal of Personality and Individual Differences, 12, 1105-1116. .

DeArmond, D. L. (1996) "Effects of the Transcendental Meditation Programme on Psychological, Physiological, Behavioral and Organizational Consequences of Stress in Managers and Executives." Doctoral Dissertation, Maharishi University of Management. Dissertation Abstracts International.

Dillbeck, M. c., Assimakis, P. D., Raimondi, D., Orme-Johnson, D. W, & Rowe, R. (1986) "Longitudinal Effects of the Transcendental Meditation and TMSidhi Programme on Cognitive Ability and Cognitive Style." Perceptual and Motor Skills, 62,731-738.

Dillbeck, M. c., & Orme-Johnson, D. W (1987) "Physiological Differences Between Transcendental Meditation and Rest," American Psychologist, 42, 879881.

Dillbeck, M. C., Orme-Johnson, D. W, & Wallace, R. K. (1981) "Frontal EEG Coherence, H-Reflex Recovery, Concept Learning, and the TM-Sidhi Programme," International Journal of Neuroscience, 15, 151-157.

Eppley, K. R., Abrams, A. I., & Shear, 1. (1989) "Differential Effects of Relaxation Techniques on Trait Anxiety: A Meta-Analysis," Journal of Clinical Psychology, 45, 957-974.

Frew, D. R. (1974) "Transcendental Meditation and Productivity," Academy of Management Journal, 17,245-262.

GustavssQn, B. (1992) "The Transcendent Organization." Doctoral dissertation.

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Heaton, D. P. & Harung, H. S. (2001) Awakening Creative Intelligence for Peak Performance: Reviving an Asian Tradition. In 1. Kidd, Xue Li, and F. 1. Richter (Eds.), Human Intelligence Deployment in Asian Business: The Sixth Generation Project. London and New York: Palgrave.

Herriott, E. (1999). "Elements of Entrepreneurial Success: An Exploratory Study of the Links Between Inner Competencies, Inner Development, and Success."

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Herron, R. E., Hillis, S. L., Mandarino, J. v., Orme-Johnson, D. w., & Walton, K. G. (1996). "Reducing Medical Costs: The Impact of the Transcendental Meditation Programme on Government Payments to Physicians in Quebec."

American Journal of Health Promotion, 10 (3), 206-216.

Herron, R. E. & Hillis, S. L. (2000). "Reducing Medical Costs: The Impact of the Transcendental Meditation Programme on Government Payments to Physicians in Quebec: An Update." American Journal of Health Promotion, 14 (3).

Jantsch, E. (1980). The Self-Organizing Universe. Oxford: Pergamon Press.

Kotter, 1. P. & Schleshinger, L. R. (1979) "Choosing Strategies for Change," Harvard Business Review, March-April, 106-111.

Loevinger, J. (1976). Ego Development: Conceptions and Theories. San Francisco: Jossey-Bass.

Lussier, R. (2000) Management Fundamentals. Springfield, MA: South-Western College.

Maharishi Mahesh Yogi (1972). The Science of Creative Intelligence: Knowledge and Experience. (Lessons 1-33). [Syllabus of videotaped course]. Los Angeles, CA: Maharishi International University Press.

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Maharishi Mahesh Yogi (1978). Enlightenment to Every Individual and Invincibility to Every Nation. West Germany: MERU Press.

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BUSINESS GEOGRAPHIes: PROVIDING THE SPATIAL DIMENSION TO INFORMATION SYSTEMS

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S. Rathore

Many business organisations around the world are using Geographic Information Systems for strategic, tactical and operational decision making.

As opposed to conventional Maiwgement Information Systems which have a predominantly RDBMS centric orientation, Geographic Information Systems or GIS store, manipulate and analyse geographically referenced data. Geographic Information Systems permit spatial problem solving which makes them ideally suited for busienss applications such as market analysis, demographic analysis, sales planning, route optimisation, transportation planning, customer service etc. Inspite of the fact that GIS is being widely usnlfor business applications in a large number of countries, the use of GIS for business decision-making is somehow not so widesprad in India. The lack of GIS training in majority of Indian B-Schools has impeded the integration and use of GIS for business applications in India. There is a need for Indian B-Schools to provide expal1Sivecoverage of GIS in their IT curriculum.

INTRODUCTION

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he last decade has seen a substantive synergy between informa \ tion systems, business strategy and business procedures. As a re suIt of this synergy, information is being increasingly seen as a strategic resource, which provides businesses with competitive advantage in a fast paced and dynamic business environment. Most contemporary Management Information Systems (MIS) however, have a predominantly RDBMS centric orientation. Typically, information requirements for decision making at strategic, tactical and operational levels are largely met through data retrieval or mining of large volumes of corporate data held in relational databases or data warehouses.

While such business information systems are capable in meeting standard information needs of organizations, they are severely limited in their

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capacity to handle and analyze 'geographically referenced' or 'geospatial' data. Most organizations routinely deal with data that has explicit or implicit geographic reference. Studies show that almost 90% of business data is geographical in nature (Moloney et. a!. 1993). However typical business information systems are usually 'unaware' of this latent geographical content and its potential value. Cooke (1993) underlines this assertion by stating that the 'art of gaining competitive advantage is by unlocking spatial information in the company's databases'.

The need for analyzing geographic information is felt when organizations are faced with 'locational' or 'geographic' problems. For example, it may be required to find the most suitable location for a retail outlet within an area or to find out street addresses in a city where the target population for a new product to be launched, resides. A company stocking hazardous chemicals might want to know the areas that will be most severely impacted in case of an accidental spill. In another sphere of activity, a courier company might want to know the shortest routes to pick or deliver packages or might want to find out the current location of a package in transit.

Answers to such questioilS are not tabular text reports (as in conventional systems) but rather locations displayed on a map that have been identified through analysis of spatial parameters such as distance or proximity to other geographical objects. Typical MIS functions are not specificaIly geared to store, manipulate and analyse geographic data. This functionality is available through a special category of information systems caIled Geographic Information Systems (GIS).

A large number of organisations around the world are making extensive use of GIS in business decision-making. Information products resulting from geographic analysis are being widely used by business and service organisations in fields such as market area analysis, market research, demographic analysis, sales planning, route optimisation, transportation planning, customer service and other similar problem domains.

WHAT IS A GIS? Simply put, GIS is a system for storing, analysing and displaying maps and map linked attribute information. From a technical standpoint, Geographic Information Systems have been defined in a number of different ways.

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centric, some are organisation centric while some others are database centric. It is therefore difficult to provide one universally acceptable definition of GIS. A process oriented definition views GIS as a system for capturing, storing, checking, manipulating, analysing and displaying data, which are spatially referenced to earth (DOE 1987). Cowen (1988) taking a technology centric view defines GIS as a decision support system involving the integration of spatially referenced data in a problemsolving environment. Devine and Field (1986) define GIS as a form of MIS that allows map display of the general information.

Whichever way a GIS is defined, one fundamental commonality in all definitions, which distinguishes GIS from other information systems, is that a GIS essentially deals with geographically referenced data. As features present on a map have a geographical reference (i.e. location on surface of earth in terms of latitude and longitude etc), it would not be wrong to loosely say that GIS deals with storage and analysis of map information. In terms of enhancing the capability of an existing RDBMS centred client-server type business information system, a GIS can also be generally viewed as an add- on analytical tool that provides a spatial dimension to business information.

GIS applications are currently being used to support operational, tactical and strategic decision-making in a wide array of organisations around the world (Grimshaw, 2000). A few examples showcasing the use and potential of GIS at different levels of management will serve best to illustrate the nature of problems a GIS is best suited to solve.

GIS APPLICATIONS

IN BUSINESS

Operational Applications The Minuteman courier company operating in Los Angeles uses GIS to enhance productivity of drivers and optimise the use of its vehicle fleet for delivering courier packages. Minuteman provides specialised services to its customers in the Los Angeles area offering 2 hour, 4 hour and same day delivery of articles. In order to make the best use of its fleet of 45 vehicles, the company has fitted each vehicle with global positioning system receivers permitting accurate, real-time location of all vehicles.

Using such a system, instructions are passed on to drivers on the road to collect additional packages for del ivery from collection points nearest to them on their way, cutting costs and ensuring shorter delivery times.

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Sears Roebuck and Company have developed a highly successful GIS application for home delivery routing. Sears saves several million dollars every year on delivelY trucking by optimizing routes using a GIS. They have also developed another GIS application called PICKPATH that selects the most efficient route for a forklift driver enabling him to lift maximum items within their warehouse premises for loading outbound trucks. While conceptual ising PICKPATH, sears had estimated that if one extra item could be lifted in one hour, it could lead to substantial yearly savings. Since its operation, PICKPATH has resulted in huge savings for the company (Weigel, 1997).

GIS has been used to assist safe transportation of hazardous substances in Germany where law demands that routes for transportation of dangerous substances like petrol, chemicals etc. be individually documented for transportation risks. Using the road network of the country, GIS has been used to calculate a 'danger factor' for each road segment based on road length and associated dangers between the starting point and the final destination.

British gas makes extensive use of GIS for carrying out repairs of underground gas pipelines in urban areas. The bulk of users for their GIS are operational engineering staff located at district offices. One major use of the GIS is to accurately locate underground gas pipelines due for repairs. In most cases, repairs require excavation of ground to expose the faulty pipeline segment and ..there is a real danger that water pipes, or worse electric cables can be cut open. Such an error, apart from being extremely hazardous to public safety, can inflict heavy financial losses to the company due to destruction of assets maintained by another company.

The Alcoa company of Australia which mines bauxite, extensively uses GIS at all levels of its management. It has a huge geographic database having 54 thematic map layers showing drill holes, contours, roads, land parcels, utilities, stripped areas, are units, blast areas, vegetation, soil, forest burning areas, forest areas impacted by dieback fungus etc. [n order to carry out ore extraction, the company has to clear large tracts of forest, some parts of which are affected by the 'dieback' fungus disease. One of the critical questions that the GIS helps Alcoa to answer is how it can mine lands without spreading the 'dieback' fungus disease to other parts of the forest. The disease can spread to other parts by water or through soil, which can stick on vehicle tyres and get transported.

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Beaton's Cranberry Growers Service (BCGS) Inc Massachusetts USA uses GIS for a multitude of tasks related to growing cranberry. GIS is used to identify optimal bog locations for application of fertilizers by helicopters. The availability of such maps to helicopter pilots have led in huge savings for the company. BCGS also rents beehives for pollination of cranberry plants.

Beehives are moved during the night to locations from where they start their pollination activities. Using a GIS, BCGS can decide the best locations to place beehives such that benefits from pollination can be maximized (Schwartz, 1998).

Tactical Applications GIS has been used for tactical decision-making. Arby's fast food chain has used a GIS to draw up marketing plans for its franchisee units. Trade area maps have been prepared and customers have been"grouped based on various business parameters to target selective discounting.

WH Smith and Sons Ltd, have a chain of 400 stores, which sell books, newspapers and magazines. Due to problems in citing best locations for new stores, WH Smith and Sons found that almost half of the new stores opened performed above budget while the rest performed under budget. The use of a GIS for potential store location planning and sales prediction has helped the company in making informed tactical decisions.

In India, Wipro Consumer Care (WCC) has used GIS in its product coverage expansion planning activities in Tamilnadu and Andhra Pradesh (Baxi, 1998). Every year, WCC reviews existing market coverage and tries to identify uncovered markets. A coverage expansion plan is drawn up for implementation by the field force. Using a GIS, WCC was able to simplify the identification of markets in targeted population strata.

Linkage of census based data with maps helped identify markets and their potential. Proper planning helped reduce the number of personal visits while making visits more focussed. It was also possible to prepare and modify route plans from existing markets and stock points.

Strategic Planning Applications Levi-Strauss & Co. USA have used GIS for strategic applications. As the largest apparel manufacturer in the world, Levi-Strauss had to redesign their strategic plan in view of changing consumer behaviour and Management

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availability of higher disposable incomes. This period marked a shift from conventional shopping to increased mail order shopping due to growth of cable television. Strategic reorientation was also warranted due to other factors such as reduction in the number of bulk customers for LeviStrauss as their major retailers started manufacturing garments themselves. In response to the above, a geographic market analysis was carried out using GIS, the results of which helped reformulate business strategy (Grimshaw, 2000).

Adding GIS Capacity to Existing Operating System Information Infrastructure GIS is available on a variety of OS and hardware platforms. Although optimal entry level hardware requirements on a PC environment require a fast P4 class machine with 512 MB of fast RAM and 40GB of hard disk space, lower end GIS software can run on ordinary home computers. All major GIS software suites are available on Windows 9x, Windows NT/2000 and UNIX environments on both PC and workstation platforms.

As GIS essentially links features on thematic maps to information in an RDBMS, existing information held in an existing MIS having an explicit on implicit geographical reference can be easily linked with map data. Most GIS software support backend connectivity with all popular RDBMS packages 1ike Oracle, SQL server, access etc.

Creation of geographic databases for a particular application requires time and resource commitments and typically has to pass through the following major steps: • .. Identification of thematic layers required for solving a business problem; • Procurement of digital or analog (paper) map data; • In case of paper maps, digitisation of maps i.e. conversion from their paper form to digital files; • Creation or conversions of database tables that contain attribute information about features on the map and linking attributes in these tables to respective features on the digitized maps. (For example the location and shape of a road is shown as a graphic feature on the digitized map but information about the road like name, width, surface type, etc. would be stored in database tables). If such tables already exit they can be used cutting development time drastically. .

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With the above basic inputs used in creating a thematic geographic database, most GIS software provide a host of simple to very complex geographical analysis options. Commercially available GIS software like ArcGIS, Mapinfo, Geomedia etc. provide direct facilities for overlay, proximity analysis, transportation models and networks, 3D-terrain visualisation, cost functions and numerous other modelling tools. Environmental Systems Research Institute (ESRI) markets a specialist business GIS package module called Arc Business Analyst, which provides many specific tools for business analysis.

The successful implementation of a GIS project may however pose some interesting technical, organisational and data availability challenges.

Some of these are: • Lack of good quality maps and geographically referenced business data.

• Problems in the availability of temporally valid and accurate census business data.

• Problems aligning existing GIS technology to business decision- making requirements.

• Low GIS manpower skills.

• Long term organisational commitnwnt to support spatial IT technologies like GIS in view of relatively high initial investments.

In certain application areas like predictive modelling, basic GIS functionality might not be enough and interface to other specialist software systems might be needed. Birkin et. al. (1999) ~ave suggested that the synergy of GIS with specialist modelling software outside the GIS environment greatly ameliorates the functional capacity of traditional GIS. Using illustrative cases from marketing and store revenue predictions, new product launches, mergers & acquisitions and optimisation of retail networks, Birkin et. al. demonstrate how tradition\ll GIS analysis can become constrained in answering difficult predictive questions and how fusing specialised modelling software with the GIS can add value to the geographical analysis. Longley and Goodchild (1999) and Longley et. at (2001) also address this issue citing limitations with reference to geographic data availability and collection.

Skilled manpower or liveware has a critical role in any GIS setup.

A large number of organizations that have used GIS successfully rate knowledge assets of their skilled people as the defining factor in successful use of GIS.

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BUSINESS GEOGRAPHICS

- THE INDIAN SCENARIO

While GIS is being extensively used abroad for a variety of business applications, its use in India in the business segment has been quite limited. Some early experimental uses of GIS by Indian businesses have been covered in gis@development (1998). However discounting minor applications in real estate, retail market mapping, transportation planning etc., business applications of GIS in the country have been few. The reasons for the restricted use of GIS in business decision-making are multifarious ranging from high establishment costs to lack of availability of good quality data. Hindustan Lever Limited, for example, experimented with GIS for planning market coverage during 1995. As the data accuracy was not good enough, the use of GIS was discontinued (JiLL 2001). Applications for retail environments and retail marketing in India have similarly been very few.

One of the prime problems with such applications in the country has been the lack of availability of geographically referenced business and demographic data. In such a scenario, business establishments have been hesitant to invest time and money in creation of geographic databases.

There are a large number of SAP implementations in India. Solutions for integration of GIS with SAP are now available but for reasons mentioned above, this integration has not been favorably seen inspite of numerous advantages that such a synergy can offer.

It must however be mentioned that during the past few years, Reliance Telecom Limited has made major investments in the use of GIS technology and development of a countrywide geographic database for use in facility and operations management. Recently, lTC's International Business Division (IBD) which runs the e-chaupal programme is also experimenting with using GIS for marketing and logistics applications.

One other major factor in the sparse use of GIS in India has been the lack of awareness of the potential of business geographics amongst managers. In such a situation, businesses are usually not able to rationalise investments in developing GIS capacity and the information gains thereof in comparison to existing IT practices. In a large part, the use of GIS within organizations thrives more on the ability of managers to break new ground by visualising the utility of geographical information to gain competitive advantage for their businesses. In a number of cases however, unfamiliarity with the potential of geographic information imManagement

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pedes the use of GIS. Grimshaw (2000) highlights this problem calling for a paradigm shift in the use of technology by businesses. He argues that more often than not, the use of technology by organisations is based on the idea of substitution involving replacement of existing business procedures with computer based ones on a function-by-function basis. In the context of GIS applications, such an approach seems to suggest that if an organisation does not have any existing manual map based procedures, a GIS will not be of much use. This, according to Grimshaw, is a severely limiting and challengeable thought process.

The lack of awareness for the use of geographic information also has its genesis in the coverage of the subject in major B-Schools of the country. A look at IT courses of most top B-schools shows practically no GIS education by way of either elective, core or perspective courses. None of the IIMs currently offer GIS courses in their PGP programmes.

Inspite of such widespread global use of GIS for business applications, the omission of GIS inputs in management programmes in India is quite conspicuous. As GIS is not taught in B-schools, there is little research and case development in the area of business applications of GIS. This is a limiting deficiency that needs urgent attention. The need for incorporating GIS education in Indian B- Schools has also been highlighted earlier by other workers (GIS@development, 1998; Bal Krishna & Pia, 1999).

Globally however, a number of MBA programmes have business geographics course content in their curriculum. The Wharton School of Business established a full-fledged GIS Lab in 1997. The Wharton GIS Lab conducts research in areas office relocation studies, automated property valuations, retail site selection, mortgage lending, inter-neighborhood inequities in property tax assessments, and spatial econometric techniques.

The real estate department of the school under which the GIS lab functions, offers an MBA with a Real Estate concentration which has a significant GIS component.

At the Wyoming University, the Department of Management & Marketing has integrated GIS into Marketing and Finance courses. They have plans to introduce GIS in the MBA core curriculum and also as an optional area for study. The Vienna University of Economics and Business administration offers a course in business GIS and Geo-Marketing in its MBA programme. The Isenberg School of Management, University of Massachusetts offers a one-credit elective on Geographic InforManagement

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mati on Systems for marketing applications in its MBA course. The MBA programme of the College of Business and Public Affairs, Murray State University has an elective on business geographics for managers. College of Business at Northern Illinois University has a full centre for business geographics offering a business geographics course for MBA students.

It must however be mentioned that inadequacy of teaching business geographics in B-Schools is not confined to India alone. During the last 10 years, this issue has been extensively highlighted in the US (Murphy, 1996). Murphy estimated in 1996 that less than 10% business schools in the US had a GIS lab and were teaching GIS. Some of the major issues in teaching GIS in business schools have been discussed by Murphy (1997). Reflecting on the possible causes of the isolation of GIS from business education, McNally (1999) points out that in a large part, GIS has been conventionally taught as a technical subject. This branding of GIS as a technical specialization has largely isolated it from end user applications in disciplines like marketing and management. This observation is quite pertinent in the Indian context also where GIS as a discipline has fructified in close association with remote sensing and has therefore largely been taught in engineering or science institutions. As a result, GIS has been seen more as a technically specialized discipline rather than as a general tool supporting diverse applications including business. However since Murphy's study and as pointed out earlier, many management programmes have now included GIS in their curriculum. Many business schools in the US have put in substantial efforts to systematically develop GIS curriculum for management courses. The Montana State University for example, worked on a three-year project to enhance GIS curriculum for business students with the following objectives McNally (1999): • Enhance student learning and technological skills across the business curriculum through interdisciplinary applications of GIS; • Increase student exposure to, and direct experience with, GIS; • Develop modules to incorporate GIS in specific content areas (e.g. marketing as well as information systems); and • Strengthen linkages between curriculum and course content and direct applications of emerging technology in the workplace.

Introduction of business geographies in B-School curriculum in India should ideally follow a systematic course content development path as suggested by McNally (1999). This would be important because geoManagement

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graphically referenced business and demographic data would have to be created or procured to support teaching. The Indian GIS industry, corporate bodies and other funding organizations can be approached to finance development of a suitable GIS curriculum for B-Schools.

CONCLUSION

r,

This paper has tried to briefly highlight the relevance of GIS to business applications. It has also tried to draw attention to the fact that the use of GIS for business applications is currently not widespread in India.

Geographic Information Systems underscore the value of location for businesses. Although the development of geographic databases may require initial investments in terms of software, equipment, data automation and skilled personnel, however proper visualisation and use of GIS aided decision making should pay rich dividends over a time span. GIS technology has seen dramatic advances in the last decade. The limited experience in using GIS for business applications by some companies in the mid 90's should not form a roadblock using GIS in the present scenario. The evolution of GIS software and the growth in its functionality has been phenomenal, at places almost incomparable to capabilities supported a few years ago. Business applications of GIS should therefore not be undermined on the basis of past experience.

There is an urgent need for Indian B-Schools to incorporate GIS education in their IT curriculum. An expanded focus on spatial information processing in management education in the country will help infuse a higher appreciation of the potential that geographic information holds in providing businesses with competitive advantage.

t

REFERENCES Baxi,P. (1998) "GIS Application in Marketing and Sales," paper presented at Map India 1998, 7-9 October, New Delhi India.

Birkin, M., G. P. Clarke and, M.Clarke (1999) GIS for Business and Service Planning in Geographical Information Systems, Longley, P.A and Goodchild, M.F.(eds) John Wiley and Sons, (2nd Ed.) Vol 2.pp 709-722.

Cooke, D. F. (1993) Unlock your Company's Databases. Business Geographies 1(1): 15-]6.

Cowen, D. 1. (1988) GIS versus CAD versus DBMS: What are the differences.

Photogrammetric Engineering and Remote Sensing, 54: 1551-4.

Management

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30 Business Geographies: Providing the Spatial Dimension Devine, H. A and R. C.Field (1986): The Gist of GIS, Journal of Forestry, August, 17-22.DOE -Department of Environment (1987): Handling Geographic Information, HMSO, London.

Grimshaw, D. (2000): Bringing Geographical Information Systems Into Business, 2nd ed., Wiley and Sons, NY. GIS@development (1998) What they don't teach you in business schools, gis@development May - June 1998 - www.gisdevelopment.net.

HLL (2001) Personal Communication to the author in October 2001.

Longley, P. A and M. F. Goodchild (1999) Geographical Information Systems (2nd Ed.), John Wiley and Sons, NY, Vol 2. pp 707.

Longley, P. A and M. F. Goodchild, D. J.Maguire and D. W Rhind (2001) Geographical Information Systems and Science John Wiley and Sons.

Moloney, T., A. C. Lea, and C. Kowalchuk ( 1993) Manufacturing and Packaged Goods in Profiting from a Geographical Information System. Fort Collins, CO: GIS World books, 105-129.

Mary McNally (1999) Market Mapping: A Project to Teach Business Students about Business Geographics, Directions Magazine, June 1999 (http:// www.directionsmag.com!features.php?feature-id=16) Murphy, L. (1996) GIS in Business Schools: A Status Report. Business Geographics for Educators and Researchers. Washington DC: AAG Murphy, L. D (1997) : Why Aren't Business Schools Teaching Business.

Geographics?

Business Geographics, February 1997 (http:// www.geoplace.com!bg! 1997!0297!0297feat.asp) Wiegel, D. (1997): The Road Less Travelled ESRI ACR News, (1997!98) Winter, pp 25.

Schwartz, K. (1998): Ready for Harvest, PC Today April 1998.

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MANAGEMENT DEVELOPMENT: THE TOTAL PROCESS EMBRACING INFORMAL AND FORMAL PROCESSES

Vathsala M. Akuratiyagamage

This paper provides a conceptual understanding of managemenldevelopment (MD). The paper emphasises the need of utilising both formal and informal processes in MD. As much of the managerial learning by experience is unplanned and unstructured, informal managerial learning is a by-product of a variety of managerial tasks, the dynamic nature of managerial priorities, changes in the working environment, and changes in colleagues and bosses, which all provide new opportunities and stimuli. So excluding them takes the MD away from reality and eliminates from conscious consideration a number of potential opportunities for leaming. On the other hand, simple reliance on opportunities to learn from experience was not claimed to be the best answer to MD. Managers recognise gaps in their experience, and they could visualise the extent to which tire opportunities could have been better recognised or tire processes could have been better managed by tlreir bosses. On the otlrer hand, there is a growing use of formal development processes to help managers learn. Therefore, the paper describes MD that embraces the total process including both processesformal and informal and finally addresses tire trends in and clrallenges to MD. Key words: Formal processes, Informal processes, Management development

INTRODUCTION

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he environmental factors have been changing theorists and prac titioners' views on competitiveness.

In today's business enviromnent, high-quality human resource is valuable, rare, difficult to imitate, and not subject to substitution. If managed effectively, human resource is the most expensive and valuable asset of an organization. Hence, development of this asset is crucial to the success of any organization. In this respect, HRD focuses on learning experiences pro-

Management & Change, Volume 8, Number I & 2 (2004) ÂŤ:J 2004 Institute for Integrated Learning in Management. All Rights Reserved.

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32 Management Development: The Total Process Embracing vided by organizations to achieve its goals by viewing people as assets rather than costs, by being proactive rather than reactive, and by balancing employee interests and organizational concerns (Bender et al 1:996).

In the international context, too, learning, knowledge acquisition and adaptation are important rationales for the creation of international businesses that contribute significantly to international business performance.

Hence, HRD efforts continue to be an essential element for organizations striving for excellence. Being a component of HRD, management development (MD) has become accepted by researchers and writers as an important means of developing managers to make the best use of resources. Researchers emphasise the importance of MD for the economic growth and success, for the organization and for the individual. It is said that a country can have end less resources of all sorts but unless better management the lower the output and its quality will be. Thus, management capability is a critical factor in any economic system (Schaafsma 1996). Further, effective management is vital for organizational success.

Companies do not receive immediate returns on the time managers spend on MD, yet growth of the companies demands upgrading of managerial skills (Lawler et al 1995). On the other hand, provision of MD can increase the level of commitment of managers to the organization and incre,S,j.setheir perceptions that the organization is a good place to work (Schuler 1987). Therefore, MD undertaken by organizations indicate commitment to managers while the recipients are more likely to feel valued as an individual is always searching and trying to develop his/her capabilities. In developing managers organizations can use two processes, namely informal and formal development processes. Informal MD processes are by-products of organizational activities, such as task accomplishment or interpersonal interaction, and managers may not set out intentionally and expl icitly to learn something through pre-planned means (Marsick and Watkins 1997; Mumford 1997). Formal MD processes, on the other hand, include institutionally sponsored, planned and deliberate processes. Thus, formal processes are often monitored and controlled by people and forces other than the individual manager involved (Marsick and Watkins 1997; Mumford 1997).

INFORMAL It has often Management

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through experience. Experience is the process of engaging in an act or situation, and experience is considered by some management writers and practitioners to be indeed the best teacher (Doyle and Young 2000).

Learning is most likely to result from experience, which is relevant and significant to the individual (Doyle and Young 2000). Thus, informal development usually occurs during the course of managers' everyday work. For instance, managers learn while carrying out responsibilities of the job, projects, presentations, committee meetings and business visits; managers learn every time when they are confronted with an unusual problem, an unfamiliar task or a move to a different job (Mumford 1997; Armstrong 1999). Further, early job challenges, early borad responsibilities and early leadership opportunities can also have developmental significance. Thus, these informal development incidents are by-products of some other activities, such as task accomplishment, interpersonal interaction, sensing the organizational culture, trial-and-error experimentation or even from the interactions they have with their superiors, peers, subordinates and customers. The most significant feature of informal development incidences is that though informal development opportunities almost always take place naturally, managers are not always conscious that they are in developmental experiences at all. Therefore, most of the informal incidences occur due to organizational decisions that are Jitade wholly or largely in order to meet organizational objectives and may have nothing to do with the development of the individual. Because of this, these situations are essentially ad hoc, informal and accidental; not actually designed for developmental purposes. Therefore, informal development incidents are tip of an iceberg- in two senses. First, they are a tillY proportion of the full range of incidences from managerial work that provide learning experiences. Second, they are the tip of an iceberg for any particular individual. Therefore, though informal, accidental experiences are widely present and often provide the deepest and richest learning, they are often badly identified and, in consequence, insufficiently used. However, there are four different approaches to learn from informal development incidences (Mumford 1997), namely, managers learn unconsciously from experience, where learning occurs through some natural process of osmosis; learning emerges by reflecting on difficulties, mishaps and frustrations, which often provide the spur for the incidental learner; learning occurs more consciously by thinking about what has happened and reaching conclusions; learning occurs by seeing future Management

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events not merely as management requirements, but as events from which it is possible to learn.

However, because there are no specified developmental goals as such accompanied with informal development incidenc~s, managers, generally, learn if they analyse what they did and determine how and why those contributed to success or failure. This retrospective or reflective learning will only be effective if managers can apply those successfully in future (Armstrong 1999). Therefore, the effective use of learning opportunities depends on the conscious attempt to improve the design of the opportunities on the one hand, and the understanding of the leamer about learning processes on the other (Mumford 1997). Hence, if managers know the advantages of retrospective learning and the possibilities of linking them to prospective learning, unintentional learning can be a basis for further intentional learning.

On the other hand, meeting organizational challenges leave little choice but to absorb, unconsciously and by some process of osmosis, lessons from their experience and develop new abilities. In this respect, development comes from inside, from individuals who desire to succeed.

Therefore, development is not something that could be done to or for someone. Development is something people do for themselves. But, as mentioned earlier, managers differ in their preferred approach to learning.

Some managers may enjoy learning from experience whereas others may not. Therefore, informal learning has to be deliberately encouraged by an organization (Woodall 2000). Organizations can provide kinds of challenges that will provide managers opportunities to develop new skills/ abilities. The developmental potential of work experience is driven by challenges it presents. While exposure can be useful, even enriching, what matters is what one is doing while being exposed. If organizations wish to encourage informal learning, then individuals need support in maintaining openness towards new experiences and perspectives, support in disciplined reflection, and support in translating the learning into practice.

The key tools to facilitate informal learning are planning for learning, creating mechanisms for learning and developing an environment conducive to learning.

In this context, managers and their bosses have to identify prospective learning opportunities and should subsequently review the extent to which individual manager has taken advantage of them (Mumford 1997).

Such identification is always looking back retrospectively to learn from Management

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the past experience. Every time what needs to be learnt should be linked to work situations. This empowers the learner to begin learning by thinking about what they want to master, improve or change (Megginson et al 1999). Managers can find learning experiences not only by thinking and reviewing normal managerial activities but also by reviewing various kinds of (mainly written) material (Mumford 1997). Some of such written materials are job description; activity list or daily/weekly reminder of things to do; work diary that may simply indicate some of the most important events on daily basis; a leaming log, where a manager deliberately keeps a review of learning experiences and opportunities; discussions with colleagues, where one or more colleagues identify similar activities and experience which may provide learning; individual discussions with boss, where some specific activity is related to a learning opportunity. Therefore, individuals have to make an effOli in the identification of learning incidences. In the planning process, personal development plans that are developed in concert between managers, their superiors, and often external learning facilitators, playa vital part. However, informal learning experience is not educational unless it is purposive. The objective or purpose guides the process of leaming. When the purpose is clear, managers can observe surrounding conditions better; they can learn from the knowledge of what has happened in similar situations in the past. Further, the purpose guides to learn from the knowledge that is obtained by recollection, and from information, advise, and warning of those who have a wider experience. In identifying purpose, it is much more likely to involve other people, probably the manager and the boss in most situations or perhaps the manager and one or more colleagues. It is partly through this process of openness, sharing, and partnership that some of the weaknesses of learning from experience can be reduced. In addition, on one hand, one of the features of managerial experience as a learning process is that managers have to pIan/pre-decide informal learning without separating learning from experience, where learning is tied to real-life problems and experience. Though learning takes place "just in time" while struggling with a challenge, this cannot happen without time to learn, feedback and other forms of assistance (Marsick and Watkins 1997). On the other hand, managers may have no choice of the managerial experience. They have to learn from them. Failure to learn from experience might not be the result of deliberate and conscious avoidance but simply failure to recognise the opportunity or ignorance Management

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about how to learn from it most effectively (Mumford 1997). In this context, manager's insight alone is insufficient; they need organizational support, which encourages individuals to grow, accepts individuals who have changed, and promotes the retention of new behaviours. Therefore, facilitation is vital at this point of the process. The contemporary view of HRD stresses that what individual manager had learnt has to flow freely within the organization (Marsick and Watkins 1997). In this regard, what is the most important is that such individual learning has to flow from the individuals and those have to be captured and used by other members of the organization. Hence, developing an environment conducive to learning is vital. Learning has to be pursued consciously and deliberately as profit (Kolb 1996). Managers and organizations should budget time specifically to learn from their experience. For example, when important meetings are held or important decisions are made, time should be set aside to critique and learn from these events (Kolb 1996). Further, managers have to have freedom to influence outcomes by taking risks and doing things differently (Megginson and Whitaker 1999). Furthermore, though informal learning occurs naturally, managers have to analyse their interpretations otherwise their false assumptions can lead them to inaccurate conclusions. Hence, reflection is the primary tool to trigger learning from experience. Disciplined reflection, challenging one's assumptions and comfortable ways of thinking, leads to deeper learning.

Unintentional learning can lead to intentional learning, only if it is identified by reflection. To make the informal and incidental learning more effective, managers can maintain learning logs, they can keep journals, or they can review backward, which are some of the tools that can be used in the learning process. Such tools provide vital information in the process of reflection. In this regard, most importantly, managers may need organizational support and appropriate environment in this process. Informal development, alone, is insufficient; formal processes are needed, visa-vis Informal development, alone, is insufficient; formal processes are needed, vis-a-vis. When considered separate, both informal and formal MD processes have their own pros and cons. Evidence reveals that informal learning was often seen by managers themselves as actually preferable to various forms of planned MD (Mumford 1997). Further, even if individuals work in organizations that have attempted various processes of formal MD, they none the less rated their informal experiences as much more significant. There can be several reasons as to why managManagement

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ers often find informal processes more effective than formal ones, such as, development programmes designed as off-the-job processes are experienced as unreal, irrelevant to the manager's priorities, or difficult to transfer the leaning to manager's job; processes of learning attached to formal development programmes reflect interests of programme designers and do not take into account different individual learning preferences.

However, there are some deficiencies in the total reliance on a single process - formal or informal. Nicholson and West (1988 as in Mole 2000, p78) conclude that organizations display an almost contemptuous neglect of the provision of formal aids to leaming adjustment. It looks very much as if in most organizations, thinking about managerial development does not go beyond the "strategy" of throwing managers into the deep end to learn by themselves. This may produce adequate, and, on occasions, even excellent performance, but it leaves much to chance, is unlikely to establish a climate of attentiveness to career needs, and does nothing to establish either loyalty or controlled adjustment to performance requirements. Major deficiencies in total reliance on informal processes can be identified (Mumford 1997). First, effective learning involves building successfully on properly understood past experience, not treating it as the only process of merit. Second, carefully acquired experience of how to do a managerial job may well become out of date. Third, closest relationships with bosses and colleagues may be excellent providers of advice and good models of effective behaviour- or they may be neither.

Fourth, though people develop skills from the "natural" processes of doing the job and find ing out whether the way they do it works, the ski II they have acquired may be inappropriate and at worst it may even be the wrong kind of skill. Finally, it is possible for a manager's work experience to be extremely narrow in terms of jobs, functions, and kinds of organization and sizes of organization, but this does not mean that a manager should not learn about general aspects of management.

Therefore, on one hand, simple reliance on 0pPOliunities to learn from experience was not claimed to be the best answer to MD. Managers recognise gaps in their experience, and they could visualise the extent to which the opportunities could have been better recognised or the processes could have been better managed by their bosses. In this context, McGregor (1960) wrote, managers are grown- they are neither born nor made. The role of the company is to provide conditions favourable to faster growth. Hence, a distinguished feature of formal MD processes Management

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is that their effectiveness depends to a very large degree on the organizations' climate and the active promotion and support of the top management.

Overall, a balanced view of MD should include the total process, which embraces the informal as well as formal processes. In this context, formal MD processes are important but by definition, in the managerial world, insufficient. They are often inefficiently provided. Informal processes are both insufficient and inefficient, because managers have often lacked the skills to make the most of them as leaming experiences.

Therefore, it is not the view that formal MD is necessarily better than processes of learning on-the-job. Nor is it the view that simply because leaming on-the-job is, in a sense, both natural and inevitable that it should be relied on to the exclusion of formal processes. Therefore, the separation of formal MD from informal processes literally takes MD away from the reality of managerial work. Thus, the integrated approach to MD should make judicious use of the both processes and should be integrated in terms of time, mental appl ication and even physical circumstances with managers' normal activities.

FORMAL

MD PROCESSES

These are institutionally sponsored, planned and deliberate processes, which are often monitored and controlled by people and forces other than the individual manager involved (Marsick and Watkins 1997; Mumford 1997). Several researchers support the claim that there is little awareness of the full range of formal process that could be used (Woodall, 2000). All most all researchers have identified similar processes, such as, coaching, mentoring, action learning groups, project assignments, job rotation, self-development, as constituents of formal processes of MD that attempt at improving managerial effectiveness through "planned and deliberate leaming processes" (Armstrong 1999; Storey 1994; Peel 1984; Mole 2000; Woodall 2000; Mumford et al 1987; Mumford 1997).

However, when comparing and contrasting one process from other processes of formal development, several problems arise. For example, rather general and loose distinctions are used between "formal development" and "self-development" and between. "off-the-job" and "on-the-job" and "work-based and work-related" MD processes. Another example is, how does "on-the-job development" differ from "doing the job" (Thomson Management

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Akuratiyagamage 39 et al 1997) or from "special projects" or "coaching"? In what way does a "special project" (Institute of Management, 1994) differ from an "incompany job rotation" (Thomson et at 1997) or "special job placement' , (Storey et ai, 1997). When different studies define to mean different things, which sometimes overlap, ambiguities create several potential problems by making evaluation and comparison difficult (Woodall, 2000).

Another, problem relating to formal MD processes is, when it comes to classify formal MD processes into several categories, researchers come up with several various categories (Armstrong 1999; Lawler et al 1995; Murnford et a11987; Storey 1994). For example, Armstrong (1999,545) categorised formal MD processes into four categories, namely: • development on the job through coaching, counselling, monitoring and feedback by managers on a continuous basis associated with the use of performance appraisal to identify and satisfy development needs; • development through work experience, which includes job rotation, job enlargement, taking part in project teams or task groups, action learning and secondment outside the organization; • formal development by means of internal or external courses; • structured self-development by following self-managed learning programmes agreed as a personal development plan or learning contract, which may include guidance reading or the deliberate extension of knowledge or acquisition of new skills on the job, with a superior or a MD adviser.

Storey (1994, p368) categorised formal processes into three groups, namely: • structured development processes that are administered by some central agency and through which all must pass to achieve creditation; • self-development, following informal, unstructured ways of learning.

Popular within this classification is the assumption that the individual "owns" the problem of his/her development, which perhaps facilitated by means of the construction of either individual learning contracts or individual learning plans; • some intermediary process, whereby self-development is supported by organizationally provided mechanisms, which includes systems of action learning, coaching, mentoring and networking.

Lawler et al (1995) categorised formal MD processes into four groups, namely:

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• • • •

on-the-job programmes; internal development programmes conducted by the firm's own staff; internal development programmes conducted by out side consultants; external development programmes.

Mumford et al (1987, p 16) categorised formal processes into four groups, namely: • changes in jobs and job content (job redesign processes)- such as learning from job moves including job rotation, secondment, and promotion to a new job; allocating additional responsibilities or tasks; projects, committees, working parties and task forces; assignments; • development processes within the job (on-the-job processes)- such as coaching, mentoring, counselling, monitoring and providing feedback by boss, and action learning; • activities external to the job (off-the-job processes) such as in-house off-the-job development courses, external off-the-job, development courses, distance learning, interactive video, group discussions, etc that are organised by the company; • development activities planned by the individual rather than by the organization such as modelling on boss, modelling on colleagues or outsiders, and reading.

By considering all the above categorisations of MD processes available, the writer finds that Mumford et ai's (1987) categorisation provides relatively definite categories. Based on this categorisation, concept and practice of formal MD processes can be briefly described as follows: Formal MD does job redesign by identifying particular kinds of work that is available within and around the existing job. The formal development is effective when the job is actually fertilised, rather than treated as naturally fertile ground from which useful things grow. The fertilisation involves the construction of effective learning and development processes around the opportunities provided. Research evidence reveals that job redesign processes of MD is practised within organizations. Job rotation, as a means of job redesign, is prescribed as more suitable for only a small number of people as a means of deliberate preparation for general management rather than as a scheme to give general experience for a large number of people (Mumford 1997; Huczynski 1983). However, the evidence shows that Japanese MD provides good examples in the use of job rotation as means of inducting managers to the organization, just after recruitment, from which both individual and the organization can gain Management

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benefits (Storey et al 1997). Learning from job moves in the form of secondment and promotion into a new organization are valued for experience that can be gained by a manager. However, it is doubtful that to what extent these processes can be used by organizations that do not have such facilities to move managers into jobs outside their employing organization. However, Japanese companies have used job moves to provide wide experience by not only moving managers to other companies in the group but also moving them to overseas job postings (Storey et al 1997). Allocating additional responsibilities, projects, committees, working parties and task forces as means of job redesign provide major potential development benefits (Mumford 1997; Huczynski 1983). However, simply providing these processes are not effective unless the available development opportunities are analysed, discussed and the actual processes of learning are understood and employed by the manager involved. Unless the manager undergoing the development process is not aware of the developmental objectives, he/she might be unable to 'get the full use of them. Thus, benefits to the individual as well as to the organization may be decreased as unintentional learning always has unintended learning consequences. However, assignments of short duration, as means of job redesign, often fail to provide the intended learning, and also managers may receive incorrect feedback about the accuracy of their performance (Mumford 1997). In consequence, the organization may also make a wrong judgement about the effectiveness of the manager involved.

Formal development processes within the job is concerned with the ways in which learning could be assisted, as distinct from job redesign, which reviewed opportunities. These development processes represent an increasing trend towards helping the individual to take charge of his/her own leaning. Therefore, the primary driver of the acquisition of knowledge and skills becomes the manager but the facilitator should be available to give guidance, insight and encouragement in the learning process.

Hence, it is important that individual managers are fully aware of the personnel gains from these, and both parties should have a clear understanding of their roles. While formal development processes are effective techniques of improving job performance in the short-term, they are more effective if they also take into account some of the long-term development needs of the individual. Hence, these processes could be,come most effective if they are part of a structured approach fully Management

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42 Management Development: The Total Process Embracing integrated into the organization's process of developing people. However, though organizations recognise the advantages these processes bring, the resource constraints could limit the time superiors can invest in their subordinates. However, in organizations where "fast track" promotion system do not exist and where it is seen as part of the superiors' role to teach and develop subordinates, development processes within the job could have record of success (Handy 1987). Further, these processes could be developed as an integral part of the daily organizational life and could be used extensively at all the levels of management.

As managers cannot learn within the job anything that is not available within or around it, they cannot develop skills that are not actually employed at the work environment. Therefore, development processes off-the-job have to be considered as complementary to other development processes. Off-the-job development processes are highly valued in the instances where managers are required to achieve new skills that are not currently available within the organization or where there is no one available within the organization in demonstrating, coaching, mentoring or facilitating development. As means of MD, off-the-job processes have its own strengths and weaknesses. Therefore, it is beneficial to use a mix of in-company and external off-the-job development processes. In most instances Asian countries prefer to use development processes off-thejob than on-the-job (Grzeda and Assogbavi 1999). It is felt that colonial and post colonial structure of the general education of Asian countries, which is in most cases instructor-oriented and less learner-oriented, could have considerable influence on the processes used for HRD, in particular MD. However, in Japan, formal off the-job development activities have typically not seen as the main route to develop Japanese managers (Storey et al 1997).

Development activities planned by the individual mainly include modelling on boss, modelling on colleagues or outsiders, and reading. Though individuals have to take the main responsibility for his/her learning, this does not remove the responsibility of the organization in providing a proper climate. Reading and modelling on boss, colleagues or outsiders as means of development processes planned by the individual will only become effective if those are integrated into a planned development scheme. It is said that in Japan subordinates grow into managers by "watching their superiors' backs" (Storey et al 1997). The open-plan office arrangement, where managers exposed to their subordinates, allows plenty Management

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of scope for this sort of learning. Reading as a part of a development programme may be a valuable way of gaining knowledge as long as the material is seen as relevant, and there is follow-up to ensure that learning has taken place. In encol;lraging learning by observing others, formal MD ought to include help on how to observe others at work and how to build review processes after the observation.

When considering criteria for selecting fonnal development processes, though there are varieties of formal MD processes available that can be used, none of the processes are superior to others (Mamoria 1998; Wills 1998). At the same time, there are numerous criteria that can be used in order to choose between different formal development processes.

However, it is argued that there is no single, simple criterion, which can be used to select a process. In this context, Huczynski (1983) states three bases that can be used in choosing formal development processes.

Those are objectives of the learning, the size of group, and the level of student autonomy. Binsted, Stuart and Long (1980) also presented some criteria for assessing and selecting development processes by their ability to deal with problems of transfer of learning into the learner's work environment. The application of such criteria helps to narrow down the choice to manageable proportions. However, there are no main or only criteria, which could be used in selecting the appropriate development process. Development contexts differ and it may be that an entirely different set is appropriate elsewhere (Huczynski 1983). In this regard, choice of the development process depends on several factors such as, organizational culture and values, development purpose and content, the profile of learners and instructors, financial and technological resource availability, time, location, adaptability to learner differences, etc. But it is nevertheless important to use different processes rather than be wedded to a single one.

TRENDS IN ORGANIZATIONAL CHALLENGES

APPROACH

TO MD AND

An organization's approach to MD had changed over years, either from a wholly informal and unstructured to a formal system, or in terms of changes within an existing formal structure. Where organizations had moved from wholly informal and unplanned processes to more structured processes, the main cause for that was the belief or recognition that Management

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without improving MD processes the organization would not meet its objectives either now or in the future. Therefore, the major causes of changes in MD processes have been derived from changes in the business itself (Mumford et al 1987). In Japan, their preference to MD processes has changed over time due to dramatic shifts experienced by the Japanese business sector, in 1995, when it has shifted from lifetime employment system to employability (Okazaki-Ward and Amaya 1996).

The evolving new model of employment system has prompted the government to provide vocational skills and MD and managers to consider more on self-development activities while companies are also conducting in-company MD programmes.

On the other hand, the preference attached to each formal development process can be changed over time. For example attendance on courses in 1980s to on-the-job development in 1990s. However, such changes within an existing formal structure request better performance planning process and place increased responsibility on line managers and MD professionals. Thus, these trends could equally be interpreted as a sign of more focused management learning or of more fragmented management development (Barham et al 1988), depending on the organizational support provided.

In this context, organizations can make considerable effort to upgrade the quality of the workforce continuously through the use of a mix of development processes instead of using a single one. Japanese. MD is a mix of planned on-the-job development, self-development and off-thejob development (Handy 1987; Storey et al 1997). Further, in the case of Vietnam, too, though their MD has primarily been based on formallecture methods, with exposure to other approaches, formal MD programs in Vietnam have begun to incorporate a mix of development processes (McDaniel and Schermerhorn 1999). However, in a similar vain, Lawler et al (1995) reported that in Thailand the use of on-the-job development programmes was seen as a part of a sophisticated, broader strategy that emphasises multiple development processes. Yet firms in Thailand did not seem to be utilising a variety of formal development processes to a greater extent; they rely mostly on development programmes provided by outside vendors, which presumably do more by way of developing general skills than on-the- job development programmes. In the case of white-collar workers, firms in Thailand were less apt to use on-the-job programmes and more apt to use external programmes. Therefore, though Management

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such studies provide an idea about the nature of MD focus, it is also possible to find different MD processes in practice in different parts of the world. Further, it can also be observed that even within a particular country context, enormous diversity of MD arrangement could be identified (Smith and Hayton 1999). Enterprises in the same industry and serving similar markets would often be quite different in their approach to MD. However, MD arrangements have important implications for human resource professionals. First they need to be made more aware of the full range of MD processes, including developmental challenges, and how these relates to informal learning. Second, to achieve an effective system of formal MD, organizations have to take the responsibility of providing proper facilities for MD as well as must increase the manager's capacity and willingness to take control over and be responsible for him/ herself and his/her own learning. Though planning, both formal and informal learning, enables individuals to nurture learning strategically and to take advantage of wider range of learning strategies that might otherwise be overlooked, it should not be forgotten that there might be range of factors that create problems. First, the process requires motivation, attitude, flexibility and propensity to learn from the individual manager.

Learners have to remain open to alternative frames of a problem, seek competing explanations, adopt an attitude of experimentation and trying on new behaviours for their own development. Second, the nature of the managers' jobs should offer opportunities to actually use the skills and competencies the manager has obtained. Therefore, addition of new responsibilities and chances to experience jobs in other sections through planned job rotational schemes are all relevant t'J provide jobs that challenge the manager and offer new and interesting work experience. Third, organizations have to provide an environment that is conducive to learning. Organizations have to encourage, nurture and support the development process, and have to promote the retention of new behaviours to make learning so much effective and valuable. Organizations have to budget resources, especially time for MD. Only through organizational support systems, what individuals learnt from the development processes will flow freely within the organizations to be captured and used by other organizational members.

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46 Management Development: The Total Process Embracing

CONCLUSION In developing managers, the separation of formal MO from informal processes literally takes MO away from the reality of managerial work.

Hence, in MO, both informal and formal processes have to be utilised.

When considered separate, both informal and formal MO processes have their own pros and cons. Hence, there are some deficiencies in the total reliance on a single process- formal or informal. Therefore, the balanced view of MO should include the total process, which embraces informal as well as formal processes. However, to be effective, both formal and informal learning has to be deliberately encouraged by an organization.

However, the most significant feature of informal processes is that though these almost always take place naturally, managers are not always conscious that they are in developmental experiences at all. Therefore, though informal experiences are widely present and often provide the deepest and richest learning, they are often badly identified, and as a consequence, insufficiently used. Therefore, informal learning has to be deliberately encouraged by an organization.

Organizations can provide kinds of challenges that will provide opportunities to develop new skills/ abilities. In the learning process, facilitators, peers, other colleagues and managers from other organizations can be great sources of knowledge.

On the other hand, managers have to integrate development into their life on the continuous basis. Organizations have to provide an environment that is conducive to learning, where learning is encouraged, nurtured and supported.

Therefore, whatever development process is used, all processes have important implications for human resource professionals.

REFERENCES Armstrong, M. (1999) A Handbook of Human Resource Management Practice.

London: Kogan Page.

Barham, K. J. Fraser and L. Heath (1988) Management for the future.

Berkhamsted and London: Ashridge Managememtn college and the foundation for management education.

Bender, 1. M., T. F. Urban, M. C. Galang, D. D. Frink and G. R. Ferris (1996) "Developing Human Resources Professionals at ARCO Oil and Gas Company". In Ferris, G. Rand M. R. Buckley (ed.) Human Resource Management: Perspectives, Context, Functions, and Outcomes. New Jersey: Prentice-Hall.

Binsted, D. R. Stuart and G. Long (1980) "Promoting Useful Management Management & Change, Volume 8, Number I & 2 (2004)

.

L__________________

__

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Learning: Problems of Translation and Transfer". In Beck, J. and C. Cox (ed.)

Advances in Management Education, Chichester: John Wiley Doyle, W. and 1. D. Young (2000) "Management Development: Making the Most of Experience and Reflection", The Canadian Manager, 25(3): 18- I 9.

Grzeda, M. M. and T. Assogbavi (1999) "Management Development Programmes in Francophone sub-Sahar-an Africa", Management Learning, 30(4): 413-429.

Handy, C. (1987) The Making of Managers: A Report on Management Education, Training and Development in the USA, West Germany, France, Japan and the UK. London: National Economic Development Office.

Huczyanski, A. (1983) Encyclopaedia of Management Development Methods.

England: Gower.

Inshtute of Management (1994) Management Development to the Millennium: The Taylor Working Party Report. Ae Way Ahead 1994-200 I. Corby: Institute of Management.

Kolb, D. A. (1996) "Management and the Learning Process". In Starkey, K. (ed.)

How Organizations Learn. London: International Thomson Business Press.

Lawler, 1. L. H. C. Jain, C. S. V. Ratnam. and V. Atmiyanandana (1995) "Human Resource Management in Developing Economies: A comparison of India and Thailand", The International Journal 0 Human Resource Management, 6(2): 319-346.

Mamoria, C. B. (1998) Personnel Management - Management of Human Resources. Mumbai: Himalaya.

Marsick, V. L. and K. E. Watkins (1997) "Lessons from Informal and Incidental Learning". In Burgoyne, J and M. Reynolds (ed.) Management Learning: Integrating Perspectives in Theory and Practice. London: Sage.

McDaniel, D. O. and 1. R. 1. Schermerhorn (1999) "Vietnam: The Environment for Management Development in the Twenty-first Century", Journal of Management Development, 18(1): 79-84.

Megginson, D. and V. Whitaker (1999) Cultivating Self-development. London: Institute of Personnel and Development.

Megginson, D., P. Banfield and J. Joy-Ma (1999) Human Resource Development.

London: Kogan Page.

Mole, G. (2000) Managing Management Development. Buckingham: Open University Press.

Mumford, A. (1997) Management Development: Strategiesfor Action. London: IPM. Mumford, A., G. Robinson and D. Stradling (1987) Developing Directors: The Learning Processes. Sheffield: Manpower Services Commission.

Okazaki-Ward, L. and T. Amaya (1996) "Editorial: Management Development in Japan", Journal ofManagement Development, 15(8): 4-7.

Peel, M. (1984) Management Development and Training. London: British Institute of Management.

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1 i

48 Management Development: The Total Process Embracing Schaafsma, H. (1996) "Australia's Karpin Report: New Priorities for Management Development?" Journal otManagement Development, 16(1): 53-69.

Schuler, R. S. (1987) Personnel and Human Resource Management. St. Paul: West Publishing Co. Smith, A. and G. Hayton (1999) "What Drives Enterprise Training? Evidence from Australia", The International Journal of Human Resource Management, 10(2): 25 I -272.

Storey, J. (1994) "Management developmenf 'In Sissons, K. (ed.) Personnel Management: a Comprehensive Guide a Theory and Practice in Britain.

Blackwell: Oxford.

Thomson, A., Storey, 1., Mabey, c., Gray, c., Farmer, E., & Thompson, R. (1997).

A Portrait of Management Development. London: The Institute of Management.

Wills, G. S. C. (1998) "Future Perspectives of Management Development". In Prokopenko, 1. (ed.) Management Development: A Guidefor the Profession.

Geneva: ILO. Woodall, J. (2000). Corporate Support for Work-based Management Development. Human Resource Management Journal, 10(1): 18-32.

Management

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8, Number

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TRAINING EFFECTIVENESS IN PUBLIC SECTOR AND PRIVATE SECTOR COMMERCIAL BANKS A MICROLEVEL COMPARATIVE STUDY

Riyaz Rainaye

This study empirically examines the training policy in two prestigious commercial banks, namely, State Bank of India and Jammu & Kashmir Bank Limited. The focus is on the various facets of training including management's attitude towards training, induction training, training needs, employees' attitude towards training, training inputs, quality of training programmes, and, transfer of training to the job. Whereas it records that the training scenario is, to a large extent, satisfactory, it evaluates the opinions of the employees of two cadres of both banks: in particular that it can be made fully effective only when the training needs assessment and transfer of training to the job are considerably improved, besides bringing in finer improvements in other dimensions. The results of this study may have some practical significance for trainees, trainers, HRD planners and banks as a whole.

E

mployers are increasingly recognizing the prime importance of un interrupted development of knowledge and skills of the workforce. ob competence is the patent product of technological advances, employee advancement, economic changes, and a host of other factors.

And accordingly, training, never a one-time exercise, is indeed the everyday job of every individual. Succinctly, training has developed into a universally recognized continuous process of direction, correction and improvement at every level of performance (Sarkar, 1978), and it is now an integral part of work and development of every organization, large and small. Certainly, training builds up the human resources that are an organization's crucial assets whose skills and motivation are the mainspring of its success (Kenny et aI., 1990). Training, if only properly planned, conducted and evaluated, is the golden key to improving rational economic performance, enhancing organizational productivity and profitability, freeing management time, reducing the time necessary to Management

& Change,

@ 2004 Institute

Volume 8, Number

for Integrated

Learning

I & 2 (2004)

in Management.

All Rights Reserved.

l \

50 Training Effectiveness in Public Sector and Private Sector

achieve desired level of quality and quantity, reducing wastages, labour turnover and accident rate, cost saving, increasing personal flexibility and versatility, providing better emotional prospects and greater job security, and subliming the employees' attitude and sense of service and probity ( Ashton and Green, 1994; Duja, 1980; Durra, 1990; Goss and Jones, 1992; Kenny et al. 1990; Lippit et al. 1985; Pairs et al. 1989; Steelman and Wagner,1989; Storey, 1995). Training per se has become sine quo non of the fast changing industrial panorama, with drastic consequences to labour, and, certainly, future training programmes shall cost more and become more complex (Gani, 1991). Future training shall be aimed at sharpening employee abilities to perform effectively, honing employees to cope with new technology, and empowering them to take decisions.

Conscious of the rising demands, leading employees in Japan, Germany, USA, and Singapore spend over 3% of their turnover on training. While demanding a high level of skill from their recruits, they train their entire workforce in such a way as to enhance their skills continuously (Keep, 1989; Koiake and Inoki, 1990; Streck, 1989). In India, the government, trade unions and political parties exhort companies to put training high on the agenda though, the evidence that the companies oblige is lacking.

However, banks, being service-oriented institutions, earlier felt the need for revitalizing and developing human resources. The change from classbanking to mass-banking created the new roles for banks; changes in the goals of the industry necessitated changes in the role of employees also.

For example, the role of a branch manager changed from that of a manager of money to that of a development catalyst. Similarly, the role of a clerk changed from a ledger keeper to that of a friend and guide of the customer. Such changes required new competencies, new job skills, new attitudes and styles of leadership. Banks, by and large tried to manage this metamorphosis by innovating their training systems.

Majority of the studies conducted so far have studied training systems in banks in an inarticulate manner. Furthermore, given the vastness of . banking industry, organized efforts to study training system have not been quite sufficient. This study is a humble endeavour to fill this gap.

PRESENT

I

i

I

I

STUDY

In this study an attempt has been made to examine the existing manpower training policy and practice in two prestigious commercial banks viz. State Management

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Bank of India (SBI) and Jammu and Kashmir Bank Limited (JKB). The aim is to assess the effectiveness of the various facets of training i.e. management's attitude towards training; induction training; training needs; employees' attitude towards training; training inputs; quality of training programmes; and, transfer of training to the job. The study is different from most of the earlier studies on the subject in India in the sense that here the perceptions of cashier-clerks and managements of both the banks have been examined to find out the difference in their opinion with regard to different aspects of training. It is based on the assumption that since training ideally serves the purpose of both the cashier-clerks and the management, they are in a sound position to estimate their training systems.

METHODOLOGY Data pertaining to the banks, their personnel! HRD policies, which have a direct bearing on performance of their employees, were collected by a series of in-depth discussions with the employees of their personnel!

HRD departments as this researcher could not have direct access to these policies. The 23-item questionnaire "Training Effectiveness," developed

by Rao (2000), was administered to collect the primary data. All the 23 items were classified into 7 different categories - management's attitude towards training; induction training; training needs; employees' attitude towards training; training inputs; quality of training programmes; '~lI1d transfer of training to the job.

The primary data was collected from the States of Jammu & Kashmir, Punjab, and Delhi by employing stratified sampling procedure using Srinagar, Anantnag, Udhumpur, Jammu, Chandigarh, Amritsar, etc., as different strata. 50 branches of each bank were selected for collection of data, corporate offices, local head offices and training centers excluded. The respondents were classified as clerks and managers. Sample size for the study was restricted to 200 cashier-clerks and 100 managerial personnel, from each bank. 800 questionnaires in all were distributed.

Some retained or returned blank questionnaires and a few returned them partially filled. The respondents included trainees and line and staff managerial personnel, mostly entrusted with the job of training. The required number of respondents was obtained from pay rolls of the banks.

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The tools of statistical analysis included mean scores, ANOVA, and Tukey's HSD (post hoc) test.

(one way)

TRAINING POLICY IN SELECT BANKS Training in SRI Training in SBI dates back to 1954. Earl ier training was periodic and general in nature. Gradually it turned to be specific. In 1961 training was accorded a high priority to meet the upcoming challenges. With the adoption of HRD philosophy in 1979, training changed its course from control- to development- orientation. There was a major shift in goals that training sought to achieve: from merely imparting skills and knowledge, the focus shifted to changing attitude and growth of self. And presently the main features of the training system in vogue in SBI are: Existence of proper training structure; Division of training areas into the State Bank Staff Colleges (SBSCs) and Staff Training Centers (STCs). The SBSCs conduct management development programmes and are considered to be institutions of higher learning, while STCs conduct programmes in the basic functional areas; Specialised institutions have been created, the one for rural development and the other for information and communication management; â&#x20AC;˘ Existence of systems for assessing training needs and training evaluation; Linkages of training to career plans; â&#x20AC;˘ Focus on programmes in specialised areas, and special programmes like stress management, special role transition programmes, etc; and Existence of a system for overviewing the training function.

At present, the SBI imparts training at three levels, viz. lower level (Award Staff), middle level (Officers), top level (Managers and Executives). The SBIs training programmes are aimed at developing a creative partnership with customers, specialised skills suited to the needs of distinct customer groups, perspective orientation to business, transfer of knowledge, facilitating orientation of attitudes. The bank at present has a vast network of training centers. The first SBI Staff College (SBSC; ISO 9002 Certified), first of its kind in India, was established in 1961 in Hyderabad, to cater to the needs of officers in SBI group. Its success led to the establishment in 1982 of SBSC Gurgaon, now famous as State Management

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, Rainaye 53 Bank Acadamy and also as Gurukul. Some specialized programmes conducted by these colleges are: Management education programmes to senior executives to develop in them a global perspective and appreciation of the macro-level environment and modern management concepts; Customers' education programmes to enable them to appreciate the bank's various products and to choose the best among the financial products and allied services; Industry-specific programmes which focus on technical, financial and marketing aspects of the industries; Programme on financial services for export and export development; Programme on project appraisal; Programmes for women managers; Programme on dealing with unions and art of negotiation.

The SBI established its State Bank Institute of Rural Development (SBIRD) in Hyderabad in 1981. The need for opening such an institute was felt in view of training a large number of officers in rural banking.

The SBI grasped in quick time the implications of an emerging scenario in which technology is an integral part of business. The bank realized that the decision making process within the bank must be reoriented towards satisfying the customer whoever and wherever he may be and provide whatever banking services he wants and wherever he wants it. To cater to SUC~l type of services, the SBI in 1990 set up the State Bank Institute of Information & Communication Management (SBIICM) in Hyderabad, for providing training to its people in management information system & communication management. Apart from these prestigious institutes, the SBI, well catering to the training and development needs of over two lakh employees, has 52 STCs spread over the length and breadth of the country and of them STC Pune is ISO 9002 certified. The STCs cater to training requirements in general, and Table 1 represents the various types of training programs conducted by them.

The central aim of these programmes is to season each employee through institutional training once in three years, so that his knowledge is updated, skills honed, and management styles reoriented. The faculty of SBSCs and STCs comprise the bankers drawn from operating and planning wings of the bank, who return to their usual banking work after completing their tenure at the training institutes. The faculty members undergo special faculty development programmes to enable them to develop as trainers. The appointment of practicing bankers in the faculty helps in keeping the training focused on realities of business situations.

Experts from other organisations are also invited to interact with the Management & Change, Volume 8, Number I & 2 (2004)

54 Training Effectiveness in Public Sector and Private Sector trainees on subjects relevant to them. While external experts are always welcome, the heavier burden of training squarely falls on the internal faculty.

Training

Table-l Programmes

at STCs

Name of programme

Target group

Focus

Foundation programme

New recruits

Introducing the new recruits into the organization and its spirit.

Core Programmes/Omnibus Programme

Prime groups with pivotal roles Need- based

Role dimensions, general education, and HRM

Functional Programmes

Specific advanced skills depending on the needs of the organization

The training in SBI is completely need-based. Training needs of the employees are assessed individually at branch level, with concern for their growth. The Branch Managers and the Divisional Managers are intimated through circulars about the training courses conducted by the training centers. The Manager goes through service sheets of employees/officers to know the type of training they have already gone through. They also discuss with the concerned employees and thereby know their weak areas. Besides, they use their own understanding of an employee's/ officer's performance in order to judge the type of training an employee needs. During September-October Branch Managers complete an employee-wise training needs assessment for the year commencing from April. The statement lists the employees identified for training as against the training programs conducted and the year-quarter during which they could be conveniently spared to attend their respective training programmes.

The Branch Manager forwards the statement to the concerned Regional Manager. The Regional Manager, after having received the statements from various Branch Managers, along with the training budget, prepares a program-wise joint statement. After the budget allocation, but failing that not later than 31 December, a joint statement is Management

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forwarded to the Personnel Officer. The Personnel Officer prepares a statement based on the information given by Regional Manager in that module and forwards it to the HRD Manager at the Local Head Office.

The HRD Manager arranges an annual training workshop involving the .planning wing and modular functionaries, Personnel Officer, Personnel Manager and Chief Instructors of the STCs. The projections of the planning wings functionaries are integrated with the demands made by the modular functionaries. After arriving at a consensus, a tentative schedule of training programmes for a Circle as a whole is prepared after taking into account the available training capacity. In February the tentative training schedules are discussed with the Dy. GMs and Circle Management Committees; thereafter, a final schedule of training programmes is prepared and intimated to all concerned, latest in the first week of March. An appropriate mix of various training methods like lectures, group discussions, case studies, panel discussions, role plays, field visits, project works, etc., is used while imparting training. The selection of the methods depends on the training objectives and the level of understanding of the participants. Audio-visual aids are used wherever necessary. Opportunities to acquire new knowledge are provided by making available the relevant study materials. Congenial conditions are created by the faculty members to encourage the trainees to share their own experiences with the objective of conceptualizing their learning by critiquing such experiences. After receiving training, the trainees return to their own jobs.

The bank makes attempts to analyse the results of the training programmes. In an attempt to identify change in skill, knowledge, and attitudes, opinion surveys of the participants are conducted, before and after they attend the training programmes. Performance appraisal system, however, helps in identifYing the change in skill, knowledge, and behaviour of employees. But there are various difficulties in evaluating training effectiveness; there can be no fixed yardstick to measure post-training performance, quality of training inputs, etc., and this makes it quite subjective in nature. After completing a training programme, the trainees are asked to rate their own performance and also suggest alternative ways to make the training more effective. This feedback is vital for designing future training programmes.

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Training in JKB Training is imparted to employees' right since the bank's incorporation in 1938. Earlier training was general in nature; slowly it turned to be specific. From the banks perspective, training is sought to achieve mainly three objectives: imparting skills necessary to perform the present role effectively and efficiently; preparing employees for future roles; and developing self-development. Training is imparted at all levels viz., lower level (award staft), middle management level (officers), and top level (executives). There is no separate budget for training though; training was never starved of funds. Rs. I to 1.5 crore are being spent on training each year The bank has not been short of a proper training structure. Its first training centre was established in Srinagar in 1971; STC Jammu was established in 1976; STC Srinagar was accorded the status of training college in 1981; STC Jammu was soon elevated to the status of a training college. The STCs is headed by a Principal, of the rank of AGM/Dy GM. The Principal is assisted by the faculty; the faculty consists of the bankers drawn from operating and planning wings of the Bank who return to their banking work after completing their tenure at the training college.

Officer employees having passed professional banking examinations are invited to volunteer for faculty membership. In recognition of their worth, a token honorarium, in addition to their salaries, is paid to them. These bankers undergo special training programmes at various centers of excellence in India and develop into effective trainers. The appointment of practicing bankers as college faculty helps in keeping each training focused on real business situations. Apart from the internal faculty, subject specialists are invited from NABARD, SlDBl, RBI, etc., to interact with the trainees. While imparting training to employees, an appropriate mix of different training methods like lectures, group discussions, case studies, project work, panel discussions, etc., is used. Training techniques are selected upon the programme objectives and the level of understanding required by the participants. The main focus is on developing operational skills. Stress is also laid on behavioural modification to provide better customer service. STCs generally conduct foundation courses on advances, general banking, credit appraisals, rural lending, documentation, cash management, etc. The aim of these programmes is to develop employees through institutional trainings so that their knowledge is updated, skills honed, and management styles reoriented. The employees are sponsored Management

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for training depending upon the type of training an individual employee needs. P&HRD department goes through service sheets of employees (employee training inventory) to know the type of training they have already gone through.

Presently, 80 per cent of the Bank's business is done through the latest technology of computers. At branch level, the Bank is using the latest software, called Banks 2000, in its daily operations. Technology Training Centres (TTCs) train employees in using this software and Systems Managers particularly are rigorously trained as they are responsible for the smooth functioning of the computer hard and software at the branch level. Officers posted in the controlling offices viz. corporate office, zonal offices, RCCs, etc., are trained in running an operating system called MS Office to carry out their routine operations.

In order to avail of the latest developments and techniques, officers are sponsored for training at various centers of excellence at national and international levels for advanced and specialised training in various spheres of banking. National Institute of Banking Studies and Corporate Management (NIBSCOM) imparts training to around 60 officers every month.

In fact, NIBSCOM is owned by five member banks and the J&K Bank is one of them. Rs. 50 lakh are spent by the Bank every year to meet its operational expenditure. National Institute of Bank Management (NIBM) and Banker's Training College (BTC) impart training in advanced banking to 5-6 officers every month. Other centers of excellence to which employees are sponsored for training are: Indian Institute of Management (IIM;Ahmedabad), Indian Institute of Foreign Trade (11FT), Confederation of Indian Industry (CII), Foreign Exchange Dealers Association of India (FEDAI), Express Bank, Qualified Learning Systems, BDP Consultancy, SSI Technologies, Banking Institute for Rural Development (BIRD), Management Development Institute (MOl), College of Agricultural Banking, National Productivity Council (NPC), Administrative Staff College of India, lIB (Koch in), etc. It remains, however, that only officers are sent for external training programmes. Executives are sponsored for training outside the country as well, yet this is not the general practice. After an employee is appointed, he is imparted induction training, followed by on-the-job training; all subsequent trainings are need-based. Training needs are assessed at the micro level. Employees are individually asked to explore the training gaps they find in themselves.

Reporting and reviewing officers while appraising the performance of an Management

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58 Training Effectiveness in Public Sector and Private Sector

employee highlight the type of training he needs. Training section of the P & HRD Department maintains the training inventory of every employee, and this data is referred to while employees are sponsored for training. After attending atraining programme, an employee is supposed to prepare a report about his learning there. Based on this learning, the employee is asked to give his opinion about the improvements that could be in the relevant field of the bank. A copy of that report is submitted to the functional head (GM) and Dy GM HRD. Viable suggestions are considered for implementation. Such employees are rewarded with appreciation letters. In case management is not satisfied with the report, the employee is asked to prepare a revised report. If again he fails to submit an acceptable report, he is considered for further grooming through other types of training. The Bank meticulously follows transfer of learning to the job. Generally an employee is posted at the job directly related to his training and learning.

RESULTS

AND DISCUSSIONS

It is therefore important to critically evaluate the training pattern in relation to the needs of the banks under study, which invest so much of time and effort and money in training their employees. And here an attempt has been made to examine the existing training practices.

An analysis of mean scores across all the items in Table 2 reveals that employees of both banks express positive views. The ratings with respect to most of the items are skewed to centre of the scale; the perceptions have been scored on a 5-point scale, implying thereby that the training scenario, to a large extent, is satisfactory. Compared to management, clerical respondents are less sanguine. However, there is a lot of scope for improving training in both the banks, more so in JKB whose respondents, compared to their SBI counterparts, are far less satisfied. To test the statistical significance in perceptions of different types of respondents (one way) ANOVA was applied. The obtained value of F (= 46.70) (Table 3) indicates that numerator of F ratio is substantially bigger than the denominator. This clearly indicates that the mean difference really exists. Tukey's HSD (post hoc) test was applied to determine mean differences, whereby the mean difference between any two samples must be at least 0.38 to be significant. Using this value, it was found that the mean difference of 1.21, 0.81 and 0.52, respectively, Management

& Change,

Volume 8, Number

I & 2 (2004)

r I

Rainaye 59 between SBI Management & JKB Management, SBI Management & SBI Clerks, and SBI Clerks & JKB Clerks, is statistically significant ÂŤ.05); the only non-significant mean difference is between JKB Management & JKB Clerks (0.21). A thorough analysis of the data in different categories yields interesting revelations MANAGEMENT'S

COMMITMENT

TO TRAINING

For the purpose of assessing the perceptions of clerical and managerial personnel of both the banks towards their respective management's commitment to their training, respondents were required to rate 3 items: Importance attached to employee training; Design and transparency of the training policy; Line management's commitment to training. The mean scores of >2 on these items received from the SBI respondents indicate that the management of SBI is better committed to developing employees through training. JKB employees do perceive that employee training is given due importance (means>2), but they are skeptical about the senior line managers' concern for employee development (means<2) and also perceive a lack of proper design and transparency in their training policy (means<2). The involvement and support of line managers in employee development, being essential, must be more prominent.

Training

State Bank of India n=200 n=100 Mean Score Mean Score Clerks Management

Statement

Managements

Table-2 Effectiveness

attitude

Training of employees given due importance in this bank.

towards

The J&K Bank Ltd. n=200 n=100 Mean Score Mean Score Clerks Management

training

is

There is a well designed and widely shared training policy in this bank.

2.86

3.62

2.28

2.47

2.59

3.50

1.93

1.98

Senior line managers are eager to help their juniors Management

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I 60 Training Effectiveness in Public Sector and Private Sector develop through training.

Induction Training Induction training is given due importance in this bank.

2.27

3.50

1.90

1.90

3.00

3.75

2.34

2.47

2.90

3.75

2.28

2.44

Induction training is of sufficient duration.

2.45

3.62

1.65

2.28

Induction training provides an excellent opportunity for new comers to learn comprehensively about this bank.

2.90

3.87

2.12

2.52

Norms and values of this bank are clearly explained to new comers during the induction training.

2.90

3.50

2.03

2.66

Senior executives/officers take interest and spend time with new staff during the induction training.

2.77

2.87

1.93

2.19

. 3 13

3.75

2.37

2.85

250

3.12

1.65

2.14

Training Needs Employees are sponsored for training on the basis of carefully developmental needs.

1.83

3.00

1.84

1.89

Employees in the bank participate in determining the training they need.

1.90

2.75

1.43

1.85

3.00

2.65

2.85

Induction training well planned.

is

New recruits find induction training very useful.

Induction evaluated

training is periodically and improved.

Employees Attitude towards Training Those who are sponsored for training programmes take training seriously.

2.59

Management & Change, Volume 8, Number I & 2 (2004)

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..~-----

Rainaye 61 Employees sponsored for training go with a clear understanding of the knowledge and skills they are expected to acquire through training.

1.63

3.25

1.37

1.85

Training Inputs Employees are helped to acquire technical knowledge and skills through training.

2.90

3.50

2.43

2.48

Human relations competencies are adequately attempted to be developed through training in human skills.

2.13

3.37

1.84

1.95

There is an adequate emphasis on developing managerial capabilities of the management staff through training.

2.59

3.62

2.15

2.14

Quality of Training Programmes External training programmes are carefully chosen after collecting enough information about their quality and suitability.

2.31

3.00

2.18

2.28

The quality of in-bank programmes is excellent.

2.86

3.37

2.25

2.14

In-bank programmes are handled by competent faculty.

2.81

3.50

2.46

2.09

Transfer of Training to the Job Managers provide right kind of climate to implement new ideas and methods acquired by their juniors through training 1.92

3.00

1.43

1.61

Employees returning from training are given adequate free time to reflect and plan improvements in the bank.

1.98

1.21

1.52

1.77

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62 Training Effectiveness in Public Sector and Private Sector

Analysis

Table-3 of Variance

Summary

Source

SS

df

MS

F

Between the samples Within samples

23.3211 14.6467

3 88

7.7737 0.1664

46.7057

INDUCTION

TRAINING

Training at the start of one's career helps in the process of employee socialization, which entails assimilation and understanding of the culture, values, systems, rules, procedures, customs, conventions, and output expectations.

To assess the effectiveness of induction training, respondents were asked to rate a total of 8 items, on a 5-point scale. Thes.e items relate to various facets of the induction training i.e. its planning; importance; duration; usefulness; evaluation; creating awareness about the norms and values of their respective banks; opportunity to learn comprehensively about their banks; and, the involvement of the senior officers/executives during induction training.

The mean scores of >2.5 on individual items received from SBI respondents make it clear that induction training is well taken care of in that bank. Responses of the JKB employees to these items reveal that induction training is given due importance; is properly planned; norms and values are properly explained; an excellent opportunity to learn comprehensively about their bank; and, overall, is highly useful. However, the clerical respondents perceive that induction trairiing is not of sufficient duration; is seldom evaluated; above all, they find executives hardly interested in interacting with newly inducted employees (means < 2).

TRAINING

NEEDS ASSESSMENT

The training needs assessment (TNA) should address the requirements of the position and the competency of the individual. According to a Harvard Business Report, the most common mistake of a corporate training programme is to take scatter short approach in training employees in subjects with little or no relation to company's goals. A survey of the US Bureau of National Affairs reports that just 11% of the supervisors based Management

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Rainaye 63 training assignments on an analysis of a persons needs; also only a 14% of the middle management level held that the selection of training programmes was based on person's needs (Timothy, 1983). In India (barring Voltas, L&T, ACC) a little effort has been made towards developing productive and workable methods for analysing training needs.

Employees are sponsored training for the sake of a 'pleasure trip' or to keep the trouble-makers out, or to reward blue-eyed employees for extraneous conditions. There have been situations where 'training needs' have been tailored to the 'existing training courses'. This faulty practice has led to what is commonly termed as the training course training needs syndrome (Ganeshan, 1986; Lawande, 1980; SarkaI', 1978; Sinha, 1984).

In SBI management claims that employees are sponsored for training on the basis of specific developmental needs and employees too participate in determining the training they need. In reality, this claim does not seem to have been translated into concrete action. In JKB, there is near una~ nimity in the perceptions of clerical and managerial respondents on employees being hardly sponsored for training on the basis of developmental needs and on not being involved in determining the training they need. These findings corroborate with those reached in Indian Steel Industry (Jain, 1985), Engineering Industry (Bannerj i, 1981), Banking Industry (Maheshwari, 1981), and these uphold the view that most of the industries in India put up a very poor performance in respect of training.

EMPLOYEES'

ATTITUDE

TOWARDS TRAINING

As the employees' attitude decidedly determines their level of performance, it should be positive and healthy and then only followed by TNA procedure (Kakkar, 1995). Fortunately, the mean scores of >2.50 received from respondents of both banks indicate that those sponsored for training take it very seriously; however, they hardly go with a clear understanding of the knowledge and skills they are expected to acquire through training, and to this SBI management does not agree (score: 3.25).

TRAINING

INPUTS

Granted that the human resources stock of an organization should have the requisite technical, managerial and human skills to man all positions and to meet their requirements, and therefore, three factors the develManagement

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64 Training Effectiveness in Public Sector and Private Sector

opment of technical, managerial, and human relations competencies were identified to assess how far required competencies are attempted to be developed through training. The relevant mean scores of >2 received from respondents of SBI imply that these competencies are well attempted to be developed through training. The JKB, compared to developing the human skills, seems laying more stress on developing technical and managerial capabilities.

QUALITY

OF TRAINING

PROGRAMMES

Quality being the extent to which a training programme meets training needs (Colarelli and Monteir, 1996). Large establishments are likely to have higher quality training programmes because they normally have more training resources and training expertise (Saari et al. 1988). In addition, large establishments are more likely to be receptive to state-ofthe-art training methods (Rogers, 1983).Culture is clearly an important factor here. Some organisations have a culture that all training should be provided externally or by external consultants. Other organisations have a very xenophobic approach to training and only use internal trainers.

Respondents of both banks are, to a large extent, satisfied with the quality of training programmes they attend. Rightly, the external training programmes seem to be chosen on the basis of their quality and suitability; the quality of in-bank programmes too is excellent, and handled by competent faculties.

TRANSFER

OF TRAINING

TO THE JOB

In nearly all studies of training outcomes, the emphasis has been on identifying and examining the characteristics of training programmes and individual learners, and relating these factors to training and job performance. The focus ignores the characteristics of the job situation and the question whether these characteristics help to determine transferability of training behaviour to the job.

The golden rule of several luminaries (Goldstein, 1986; Mc Ghee and Thayer, 1961; Marx, 1982; Machalak, 1981; Morsel, 1957) is that there must be a supportive organizational climate for the learning to flow from class-room to work-place. The SBI management respondents claim that it provides the climate conducive to implement new ideas and methods Management

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J

Rainaye 65

acquired by juniors through training (mean: 3): in reality, this claim does not exactly hold - as is also evidenced by low mean scores of 1.78 and 1.99 received, respectively, from SBI clerical and managerial respondents on if 'employees returning from training are given adequate free time to reflect and plan improvements in the bank'. And, the JKB respondents unanimously say that transfer of learning to the job is hardly made possible by the managers, as evidenced by their low mean scores of around 1.5 on these items.

CONCLUSIONS

AND SUGGESTIONS

A deeper study of training effectiveness goes to say that: Line managers are not well involved in employee development; Induction training in the JKB is not of sufficient duration, evaluated properly, and senior executives do not interact properly with subordinate employees; Training objectives are not sharply perceived and achieved; JKB doesn't well concentrate on development of human skills; Standards of external training programmes and also in-bank programmes, are well maintained.

The SBI management is staking the claim that, barring a few improvements needed in TNA and transfer of training to the job, the working of the training function is excellent. This claim is however doubted by its own clerical staff. The clerical staff believes that unless TNA mechanism and transfer of learning to the jobs are considerably improved, besides bringing finer improvements in other dimensions, potential benefits of training cannot be harvested. There is a close correspondence in the perceptions of JKB clerical and managerial personnel with regard to the effectiveness of training function. Like their counterparts in SBI, JKB employees also believe that training function in the bank cannot be made effective unless TNA and transfer of training to the job are improved, besides bringing finer improvements in other dimensIons.

Though the executive cadre personnel are sponsored for advanced management programmes, the relevance of these programmes to the banks effectiveness in the long run has yet to be ascertained. The initiative to improve the status of training from 'control' to 'development' orientation mechanism has to be taken afresh.

The results of the study have a marked significance for trainees, trainers, and the banks as a whole. Everyone working in the banks has Management

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66 Training Effectiveness in Public Sector and Private Sector

a role, individual and collective, to play in making this vital HRD mechanism work effectively. Training is the joint responsibility of employers and employees, by which both are enriched. For training to be successful, employees must be willing to be trained, thereby improve their performance, and supervisors must be able to train and help subordinates raise their level of performance. A favourab,le attitude of the top management to the day-to-day process of growth of employees is of paramount importance. An employee, whatever his talent, working in restrictive climate which stifles his initiative and creative thinking and action, will decidedly respond poorly to a training assignment (Sarkar,1978).

To be meaningful, training has to be amalgamated with the overall HRD strategy of the banks; it must embody such golden guidelines and principles as frame the governing instrument of the training system. That amalgamation may be achieved only when training activities are performed in a systematic manner. As such, there is need to develop realistic plans for manpower training, execute them properly, and follow them up with uninterrupted monitoring. Training programmes must be scientifically evaluated to ensure that both their content and method are precisely relevant to the needs of the bank, which in them invest effort, time, and money. Surely, the transfer of training must be facilitated, to accelerate innovation and creativity. Regular and continuous feedback must be provided to the trainees in resvect of their progress in training. Hopefully, the suggestions put forth here, if properly perceived and rightly implemented, wi II certainly give an impetus and enhance the role of training and push it forward to integrate with the overall mission of the banks.

REFERENCES Ashton, D. & Green, F. (1994) 71'aining in the World Economy, Edward Elgar, Aldershot.

Bannelj i, K. (1981), "Evaluation of Training- A Study of Supervisory Development", Indian Journal ol7l'aining and Development, Vol. 11(4): 150-155.

ColareHi, Stephen M. and Monteir, Mathews S. (1996) "Some Contextual Influences of Training Utilisation", Journal of Applied Behavioural Sciences, Vol. 32(3).

Duja, VD. (1980), "An Appraisal of Training and Development in Public Undertaking", Indian Journal of Training and Development, Vol. 10(1): 24-29.

Durra, Abdel Bari (1990). "Assessment of Training Needs within the Context of Administrative Reforms in Jordan", International Journal of Manpower, vol.

Management

& Change.

Volume

8. Number

I & 2 (2004)

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Rainaye 67 1(7):3-10.

Ganeshan, R. (1986), "Training Grid for Effective Trainers", Indian Journal of Training and Development, vol 16(1):22-25.

Gani A. (1991), "Personnel Challenges by 2000 A.D." Indian Management, Vol. 30(1):31-38 Goldstein, I.L. (1986), Training in Organisations. Programme, Development, Needs Assessment, and Evaluation" Pacific Grove, C. A. Brooks/ Cole.

Goss, D. & Jones, R. (1992), "Pathway to Progress", MEAD, 23( 1):65-74.

Jain, K .K. (1985), "Training and Development in Public Enterprises: A case of study of Indian and Steel Industry", Lok Udyog, 10(1 1):21-27.

Kakkar K. C. (1995), "Assessing trainability - An Approach", Indian Journal of Training & Development Vol. XXV NO.4, 17-30.

Keep, E. (1989), Corporate Training Strategies: The Vital Component" in J. Storey (ed.) New Perspectives in HRM, Routledge, London, Kenny, j; Reid, M; & Donnelly, E. (1990), Manpower Training and Development, IPM, London.

Koike, K. & Inoki, T. (1990), Skill Formation in Japan and South East Asia, University of Tokyo Press, Tokyo.

Lawande, K.N. (1980), "Identification of Training Needs and Design of Training Programmes", Indian Journal of Training and Development, Vol. 10(1):34-

37.

Lippit, G.L., Langseth, P., & Mossop, J., (1985) Implementing Change, San Fransciso: Jossy-Bass,.

Olganisational

Machalak, D. F. (1981) "The Neglected Half of Training" Training and Development Journal. 22-28.

Maheshwari, B.L. (1981), "Formal Trainjng, Skills, Development and Job Performance", ASC Journal of Management, Vol. I I (I ):28-38.

Marx, R.D. (1982) "Relapse Prevention for Managerial Training. A Model for Maintenance of Behavioural Change". Academy of Management RevieH~ 7(3), 441 - 443.

Mc Ghee, Wand Thayer, P.W. (1961), Training in Business and Industry New York: Wiely.

Morsel, 1. N. (1957) "Why training Programmes fail to Carryover" 34 (56-64).

Personnel,

Pairs, S Jarvis. & Wagner, K. (1989), "Productivity and Voctional Skills in Services in Bretain and Germany: Hotels", National Institute of Economic Review, Vol. 130: 52-74.

Rogers, E.M. (1983), Diffusion of Innovations (3rd ed.), New York free Press.

Rao,

T.v.

(2000), The HRD Missionary, Oxford & lB.H Publishing Co. " .

M' Johnson, T.R; Mc Laughlin, S.D; and Zlm~nerl~, D.M. (1988): ~ SaarI, L. 0 f' Manaaement Traininab and Education PractIces In US CompanIes, Survey b Personnel Psychology, 41, 731-743.

68 Training Effectiveness in Public Sector and Private Sector Sarkar, M. N. (1978) "Industrial Training: Concept, Need and Approach," Indian Journal of Training and Development, Vol. 3(8): 3-7.

Sinha, D. (1984), "Attitudinal Changes in Training Programme", Indian Journal of Training and Development, 14(2):66-69.

Steelman, H & Wagner, K. (1989), "Productivity, Machinery and Skills", national Institute of Economic Review, 128: 40-58.

Stephen, M. Co1arelli and Matthew S. Montei (1996), "Some Contextual Influences on Training Utilisation", the Applied Journal of Behavioural Science Vol 32(3).

Storey, J. (1985), Human Resource Management: A critical Text, Routledge, London.

Streck, W. (1989), "Skills and the Limits ofNeo-Liberalism: The Enterprise of the Future as a Place of Learning," Work, Employment and Society, Vol. 3(1): 89104.

Timothy, J. Keaveny, (1983) "Developing and Maintaining Human Resources" Training and Development Journal. 65-68.

(

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Management & Change, Volume 8, Number I & 2 (2004)

IMPORTANT FACTORS FOR STRATEGY FORMULATION IN FAN INDUSTRY: VIEWS OF DECISION-MAKERS

Dilip Roy

Saikat Banerjee

Unlike other durable products, the fan industry, being a seasonal and low technology industry, needs an exclusive attention for its future planning.

This paper deals with the strategic management process of the fan industry in India. It is based on a survey work carried out on the corporate decision-makers of the organized sector of this industry. The factor priorities have been studied and the most important internal and external environmental factors have been identified for different risk taking propensity of the strategists. The preferred mode of the internal and exlernal factor matching has been examined for the risk oriented and risk aversive managers. All the conclusions drawn herein have been validated through statistical inference approach.

NEED FOR ENVIRONMENTAL

ANALYSIS

1f

he corporate world currently is facing a complex en vi â&#x20AC;˘ ronmental turmoi I. Continuous changes are taking place in every sphere of management. The foremost objective of an entrepreneur is to ensure survival and future growth. According to Prahlad (1990), competing for the future means maintaining continuity by ensuring that the company is continuously focusing on resources. The link between effective scanning and successful action is another fundamental presumption in strategic management literature. Snow and Hrebiniak (1980) have suggested that action-performance linkages might take place because of the progress of necessary unique competencies in changing environments.

In the volatile emerging environment facing most competitive organizations, 'domain offensive' actions in the form of new products and services might also be expected to jeopardize competitive advantage (Miles, 1982). Not everybody is following the same route to perform. It may be true that all the players have certain industry specific bottom line. This Mana~ement & Chan'Se. '{G\ume ~, Number \ & 2 l2(04) Irt. ~DD4 lnsi"ltute for lntegrate d L earnmg . .m M anag e Inent IC!

.

All Rights Reserved.

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70 Important Factors for Strategy Formulation in Fan Industry

bottom line cannot be found in isolation and organisation should reconnect the whole.

Technological revolution, ever-increasing consumer demand, complex competitive dynamics, easy media accessibility have made it difficult for an entrepreneur to formulate a business strategy to perform profitably in the long run. This phenomenon of insecurity is creating major effect on firm's long run issues including goal formulation, strategy selection, and opportunity identification. It may influence short run indicators like market entry time, life cycle pattern of brands, pricing and promotional strategies in a broad sense. This certainly has a long-term impact on existing or future players of any particular product field. It may indulge the scope of industry specific or product specific customized business planning for success in present business scenario. The main mantra of entrepreneurial success is the time specific efficient utilization of available resources. This calls for proper use of internal strengths in the light of external threats and opportunities to cope with the continuous pressure of grow or go. To formulate strategic plan complete environmental scanning is of top priority to strategy makers of any product field. Hofer and Schendel (1978), stressed on importance of environmental scanning system'for business success in complex environments. Environment is the first responding parameter where a marketer can feel the pulse of change. Success of strategic planning completely depends on proper analysis of environment to finalize future strategies. Rapid change has to be addressed directly in the area of improving operational effectiveness (Porter, 1991). To create a successfu I future a continuous selectivity of performing factors and synergistic effect is required (Prahlad, 1990). We may see present regime as one of the opportunities and challenges for the firms. It will be an age of vulnerable consumer loyalties and boundaries among businesses. The environmental scanners have noticed that organizations are now operating in more complex environments than ever before (Van de Ven and Joyce, 1981). Obvious results are high uncertainty and risk because of complexity in decision-making. In true sense it may create ample scope of growth for intelligent strategic planner.

(Elenkov, 1997) researched environmental scanning system and performance covering industries of a country as a whole. Here major question is whether an industry specific scanning may be organized to nurture profitability? To answer this question we need to identify priorities of different external and internal factors. Once priorities are determined Management & Change. Volume 8, Number I & 2 (2004)

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Roy and Banerjee

71

the importance of factor matching is to be studied. Thus, main scope of this study is to make industry specific selectiOJi of important external and internal environmental factors and to identify their matching process to finalize industry specific strategy formulation. We have selected fan industry as the focus of our study.

SEGMENTATION BASED ON RISK TAKING PROPENSITY Our findings are based on a survey work on corporate decision-makers of fan industry in India. In this survey we have conducted a mail/direct interview of decision-makers with the help of a structured questionnaire.

Total number of response is sixty. These respondents have been selected randomly from among the available list of who's who of fan industry.

We have subdivided the sample set into two homogeneous segments based on risk taking propensity. We are of the view that an individual's thinking process alld behaviour may get influenced by his propensity to take risk .. On the basis of attitude towards risk an individual may be considered as risk oriented or risk averse in his service life and/or personal life. It is believed that the rate at which a person achieves his/her success will be directly linked to his/her aptitude to take risk. This may be true in case of business decision making also. When an entrepreneur is clear about his objective, there are usually a lot of risks to take. But this risk taking may not be for the sake of taking risk but it should be objective based.

For the purpose of risk based classification, a projective technique has been used to classify each respondent into one of the two different groups. This projective technique is based on the hypothesis that at the time of selection or performance evaluation of an employee an executive prefers a person similar to his own risk orientation. As propagated

by MacKinnon, 1975, a risk taker normally generates a process that is extended in time and characterized by originality, adaptiveness and realization. According to Gorkin (2000), major behavioural characteristics of risk takers may be summarized in the following manner. They â&#x20AC;˘ are not overly preoccupied with making mistakes or with social disapproval, â&#x20AC;˘ â&#x20AC;˘

have a strong enough ego to admit their mistake, and are analytic, emotionally stable and willing to learn from trial and error approach.

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72 Important Factors for Strategy Formulation in Fan Industry

In view of the above discussions, we feel the need for classifYing our findings according to two different categories namely Risk Oriented Managers (ROM) and Risk Aversive Managers (RAM) for inducing homogeneity amongst the reported units.

Out of the sixty respondents forty-three decision-makers have been identified as ROM. Rest seventeen decision-makers have been identified as RAM. We have described our findings separately for each risk group.

Later we have tested these results for significant differences if any. If the difference is insignificant, one may combine ROM and RAM categories and present an overall result CHOICE

OF ENVIRONMENTAL

FACTORS

There are unlimited factors that affect the business firm in each area of its environment. But all these factors are not of equal importance. At the time of factor selection, both external and internal factors, we have followed the approach suggested by Glueck (1980) and considered economic, government/legal, market/competitive, supplier /technological, geographic and social factors as the most important external factors. Out of these economic, legal, geographical, and social factors describe macrolevel forces of the environment. These are generally more uncontrollable than micro-level forces, i.e., market/competitive, supplier /technological factors.

Micro-level factors, that drive competition at industry level, are of extreme importance. Decision-makers should consider level of competition of the firm to predict its chance of survival and direction of growth. This includes competitive position, entry and exit barriers, forthcoming strategic jolt, availability of substitutes and complements, mobility across strategic groups, capacity utilisation. Regarding market, one should consider market size, status of product life cycle, customer segmentation and market opportunities.

Our country is now at the peak of the developing curve. Continuous shifting from village to town is a major trend. Emphasis on land reforms and higher rate of urbanization with speedy electrification have been creating a huge scope of future domestic market growth. Simultaneously rapid industrialization, infrastructure development, forthcoming projects are helping potentiality of institutional market opportunities.

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Regarding internal factors our choice has been restricted to finance, market, production, personnel and corporate resources as they describe the most important internal activities.

ASSIGNMENTS OF PRIORITIES TO EXTE~AL NAL FACTORS

AND INTER-

Regarding factor priorities early findings can be grouped under two schools of thoughts. First one, as popularized by Wadha (1974), Glueck (1980) and Bibault(1982), propagates economic and government factor as the most important external factors for any economic unit. Another one, popularized by Aguliar (1967), advocates that market/competitive factor should be the prime factor of consideration during environmental analysis. According to Aguliar, knowledge about external and internal factors of operating industry assists top management in its role of formulating company's future move. It plays the role of link pin to an organisation for getting adapted with its environment (Hambrick, 1981). On the basis of most important environmental factor identification, an industry can develop its SWOT matrix. But all these findings are based on studies in the developed countries. In the Indian context Roy (1997) has also observed that economic factor is one of the most important factors. Table-l gives a summary of different studies conducted in the past.

Proportion

Factors

Table-] of respondents favoring different environmental factors as the most important one

Wall

Aguliar

Collings

1967 Economic/ Governmental Supplier/ Technological Market!

Competitive Social!

Geographical

Bibault

Glueck

Wadhva

Roy

1982

]980

1974

]997

Most

Most

8%

5%

67%

Most

Next Most

10%

15%

7%

Least

Next Least

Most Most

75%

60%

26%

Next

Next Most

Least

7%

20%

Management

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-l 74 Important Factors for Strategy Formulation in Fan Industry

PRIORITIES

ASSIGNED BY RISK ORIENTED MANAGERS

In our study on risk oriented managers of organized fan market, we find 'a strong agreement between decision-makers' view and Aguilar's view.

From Table 2 we qpserve that 67.44% of risk oriented decision-makers consider market/ competitive factor as the most important external factor. Economic factor is the second most important one (supported by 18.60% risk oriented managers).

Table-2 Frequency distribution of most important External factors according risk oriented managers Most Important Factor

Risk Group Risk Oriented Managers Frequency

Proportion

Economic/ Govt.! Legal Market/Competitive Suppl ier/Techno logical Social/Geographical

8 29 5 I

0.18604 0.67441 0.11627 0.02325

Total

43 -j

To test whether the difference in priorities between market/ competitive and economic factors is markedly significant we employ a statistical test based on multinomial distribution. Let at be the population proportion of planners assigning highest priority to market/competitive factor. Let a2 be the population proportion of planners assigning highest priority to economic factor. We may state the null and alternative hypotheses as Ho: a = a2 and HA: al > a2 respectively. We propose to test this problem using j

sample proportions We have then

and

E(a, -a 2)

and

~

var (aj

Management

=

al' where a

2

E(a

j)

-

E(a

= 0.67441 and

J = a I-a

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Volume

8, Number

I & 2 (2004)

2

= 0.18604.

2

~ ~ ~ a (1- a a2) = var(aj) + var(a2) = ----" nl j

-

a

j)

a? (1- a2) + __ n2

Roy and Banerjee 75

Again,

a] - a2

will also be normal when n1 and n2 are sufficiently large.

In that case we can say

(a] -a2)-(a]

-a2)

a] (1- a,)

a2 (1- a2) ----+---n]

n2

will be approximately distributed as a standard normal variable. Under the null hypothesis

E

a -a 1

= 0 and var(a1

-

a

2)

= a(1- a){_l + _1_} where n]

2

n2

U

is the

common value of u and ur We may use the following test statistic j

T=

a

for testing Ho' where is the pooled estimator. Test result shows that the value of Z b is 4.06. It is greater than the value of Z i.e.l.6449 at o 0.05 level of significance. So, we accept alternative hypothesis and conclude that for fan industry importance of market! competitive factor carry more weightage than economic factor at the time of factor selection by ROMs. One can say that competitive position, entry and exit barriers, market size, status of product life cycle, customer segmentation and market opportunities are major attributes for consideration of market/ competitive factors. In fan trade we may observe a different usage pattern for different segment. Brand wise firms are enjoying different level of acceptance of their different product categories. For example, Crompton is enjoying its foothold in metros, mini metros. Polar is getting high acceptance in towns, small towns, and villages. Purchase decisions of customers are traceable along the demographic, lifestyle and attitude based 'choice dimension. These indicate that the causes behind organizational 5

'"

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I

11

76 Important Factors for Strategy Formulation in Fan Industry

success in fan trade can not be equated with the company's performance in terms of benefits that accumulated to its promoters and shareholders.

It is far more complex and is largely dependent on market scenario and level of competition. Again, product quality features in this trade are gaining its importance. In future it may play an important role for product differentiation and market segmentation. We may mention that in this millennium nurturing mass market is the prime task of business houses of all consumer goods. In mass market, new hype of technological revolution has changed life style of people. It has a major impact on attitudinal parameters of consumers. In every step of consumer ladder there is a high demand for new product features. This changing consumer choice pattern obviously makes it tough for firms to produce mass-market product to cater to the need of everyone.

Regarding internal environment we can easily note from the Table 3 that 51.16% of ROMs consider 'marketing' factor as the most important internal factor. Next 20.93% of ROMs think 'Finance' as the most vital one.

1

Table-3 Frequency distribution of most important internal factors according risk oriented managers Most Important Factor

Finance Marketing Production Personnel Corporate Resources Total

Risk Group Risk Oriented Managers Frequency Proportion 9

22 3 3 6

0.2093 0.5116 0.0697 0.0697 0.]395

43

So, for sampled ROMs of fan trade, marketing activity of the organisation is the most important internal factor followed by finance and accounting. We propose to test the validity of this conclusion in the population. Let 13) be the population proportion of ROMs favoring marketing as the most important internal factor and let 132 be the population proportion of ROMs favoring finance as the most important internal Management

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J

Roy and Banerjee

77

factor. We Iike to test

P1

P2

P2'

Ho: = and HA: Pl > We propose a multinomial test statistics, similar to the earlier one except the fact that this test is based on of

ÂŁXI

and

ÂŁx2'

PI

= 0.5116 and

P

2

= 0.2093 in place

Our survey result shows that value of

Zobs

is 2.498. It

is greater than the value of Za =1.6449 at a = 0.05 level of significance.

So, we reject the null hypothesis and accept the alternative hypothesis.

It reveals that for ROMs of fan industry strength of marketing, as an internal factor of the organisation, carries significantly greater importance than finance.

We have made some informal interaction with a few customers.

According them, factors like price, color & design, sales promotion activities are very important choice factors at the time of selection of brands. In fact, fan, being a completely durable product, after sales service and guarantee are important purchase determinants. These have direct impact on repeat purchase behaviour of consumers and in terms of word of mouth promotion.

PRIORITIES

ASSIGNED BY RISK AVERSIVE MANAGERS

This subsection covers views of risk aversive managers of fan industry.

Table 4 presents the views of risk aversive managers on most important external factor at the time of scanning.

Table-4 Frequency distribution of most important External factors according risk aversive managers Most Important

Factor

Risk Group Risk Aversive Managers Frequency Proportion

o

Economic/Govt./Legal Market/Competitive Supplier/Techno logical Social/Geographical

9 3 5

Total

17

Management

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0.52941 0.17647 0.29411

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78 Important Factors for Strategy Formulation in Fan Industry

From this table we observe that among the risk aversive managers 52.94% consider market/ competitive factor as the most important external factor. Social! geographical factor is occupying second slot with a support from 29.41 % of the respondents. So, it is revealed that risk aversive managers, like risk oriented managers, also consider market/ competitive factor as their main area of concern. Let 8] be the population proportion of risk aversive managers favoring marketing as the most important internal factor and let

82 be the population proportion of

risk aversive managers favoring finance as the most important internal factor. To test whether the difference in priorities is markedly significant, a multinomial test statistics is used to test Ho: 8] >

=

82 against HA: 81

82

Here

0

1

= 0.52941 and

O

2

= 0.29411. The test result shows that value

of Z osb is 1.10. It is less than value of Z a i.e.1.6449 at 5% level of significance. Thus, we reject alternative hypothesis and accept null hypothesis. We may conclude that for risk aversive managers of fan industry both market/competitive and social! geographical factors carry equal importance at the time of factor selection. According to them there is strong influence of sociological factors in different geographical areas apart from market/competitive factors.

After identification of risk aversive managers' view about most important external factor, we have examined their ideas about most important internal factor for environmental scanning. The findings are presented in table 5. It depicts that 64.70% of risk aversive managers consider 'marketing' as the most important internal factor. Their second choice is finance, which enjoys 17.64% support. Let us test whether the difference in priorities are markedly significant. Let rP] be the population proportion of risk aversive managers favoring marketing as the most important internal factor and let rP2 be the population proportion of risk aversive managers favoring finance as the most important internal factor. Here, null hypothesis

is Ho:

rPl

=

rP2 and alternative hypothesis is HA: rP1

> rP2' Management

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Volume 8, Number

1 & 2 (2004)

Roy and Banerjee 79 Table-S Frequency distribution of most important internal factors according risk aversive managers Risk Group Risk Oriented Managers Frequency Proportion

Most Important Factor

.J

11 1 2 17

Total From the table 5 we have

0.1764 0.6470 0.0588 0 0.1176

"

Finance Marketing Production Personnel Corporate Resources

JI = 0.6470 and J2 = 0.1764.

Observed value,

Z ob's of the test statistics is 2.53. It is greater than the critical value Z a =1.6449 at 5% level of significance. So, we reject null hypothesis and accept alternative hypothesis. Hence we conclude that for risk aversive managers of fan industry marketing factor carries greater importance than finance at the time of selection of internal factors for formulation of strategy.

From this finding we can conclude that in fan industry, marketing as an internal factor, isa prime decision making parameter. In fan trade pricing and product technologies can be imitated easily. The quality of service through marketing force is not easy to match. So for an existing player in fan trade development of employee efficiency is essential for long-range survival. Other marketing resources like research efficiency, corporate brand equity, power of market communication, innovative marketing activities have direct impact on the organizations efficiency.

COMPARISON OF PRIORITIES OF FACTORS ASSIGNED BY RISK ORIENTED AND RISK AVERSIVE MANAGERS A comparative study on the statements of risk oriented and risk aversive managers is needed to find out major similarities and dissimilarities in their views so as to ascertain the effects of risk taking attitude of the planManagement

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j 80 Important Factors for Strategy Formulation in Fan Industry

ners on their strategic planning. In Table 6 a complete comparison is presented for better understanding of the most important external and internal factors.

Frequency

Table-6 distribution of Managers according to Risk and most important External factor

!

1

I

Most Important Factor

Economic Market/Competitive Supp lier/Techno Iogi cal Social/Geographical

Risk Group Risk Oriented Managers Risk Aversive Managers Frequency Proportion Frequency Proportion 8

29 5 I

,0.18604 0.67441 0.11627 0.02325

0 0:52941 0.17647 029411

17

43

Total

9 3 5

From this table we observe that percentage of respondents ranking 'market/competitive' factor as the most important one varies with the propensity to take risk. Among the risk aversive managers 52.94% consider market/competitive as most important external factor. For risk-oriented group this proportion is as high as 67.44%.

Similarly, to have a better insight into effects of risk on priorities of internal factors let us consider another comparative study given in Table-7.

Frequency

Table-7 distribution of Managers according to Risk and most important internal factor

Most Important Factor

Risk Group Risk Oriented Managers Risk Aversive Managers Frequency Proportion Frequency Proportion

Finance Marketing Production Personnel Corporate Resources

9 22 3 3 6

Total

43

Management

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02093 0.5116 0.0697 0.0697 0.1395

3 11 I

2 17

I & 2 (2004)

0.1764 0,6470 0.0588 0 0.1176

j

i

Roy and Banerjee

81

From this table we can make some interesting observations. Here 51.16% of risk oriented managers and 64.70% of risk aversive managers favour 'marketing' factor as the most important internal factor.

Thus, in both the cases of risk oriented and risk aversive managers, most important external and internal factors are market/competitive factor and marketing factor. These may be so because f~n trade is facing multiple environmental factors of importance. Government policies, lowering of tariffs, abolishment of entry barriers, deregulation are playing regulatory roles on business operation. Again, there is a continuous change in consumer demographics and psychographies. New changes in social structure and life styles in terms of value awareness, information orientation, technology sensitivity, and global market exposure comprise multiple layers of consumers. As a result, it breeds multiple levels of competition. The primary challenge before a firm of fan industry is that of universal danger of the presence of unknown compqitors.

But there may be disagreements in respect of the other factors of importance. To statistically analyse whether the importance assigned to internal and external factors is dependent on the propensity to assume risk we may use the chi-square test statistic for equality of proportion.

Let there be I similarly classified populations and k be the number of classes in each population. Let Pij be the proportion of the j th population in the i th class where i = 1,2, ... , k and j = I, 2, .. .,l. We may want to test if the I population distributions can be viewed as identical, I.e.,

Ho: Pil = P'2 = ... = P" for each Let iij be the number of members of the j-th sample which belong to the ith class, where k

i = 1,2, ... , j =1,2, ... , I , and

I/ij

= n .. Then,

1=1

J

"" f} n nL.L.--i j fanj

Management

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, 82 Important Factors for Strategy Formulation in Fan Industry is approximately

distributed

/;0 = I/;, and n=2>, I

as a

X2

with df (k-I)(l

-I).,

where

. The hypothesis Ho will be rejected or accepted

,

if the observed value of

2

exceeds

X

being the upper a-point of the X

2

X~.(k-l)(I-l)

or not,

X~,(k-l)(l-l)

distribution with df (k-I )(/-1).

Here, let the null hypothesis and the alternative hypothesis for studying the external factors be respectively stated as Ho: There is no structural difference among risk groups in respect of their assigning highest priority to external environmental factors.

HA : There is a structural difference among risk group in respect of their assigning highest priority to external environmental factors.

In this case we note from Table 8 that the degrees of freedom is equal to (k-1) (/-1)= (4-1) (2-1)= 3.

Table-8 Frequency distribution of Managers according to Risk and most important External factor Most Important Factor Risk Oriented Managers Frequency

Risk Group Risk Aversive Managers Frequency

Total Frequency

Economic/Govt. /Legal Market/Competitive Supplier/TechnoIog icaI Social/Geographical

8 29 5

I

3 5

8 38 8 6

Total

43

17

60

Observed value of the X2

9

test statistics is (0.8962 + 0.1146 + 0.0938

+ 2.5326+ 2.2667 + 0.2899 + 0.2372 + 6.4059) = 12.8369. The critical value of X2 Management

at 5% level of significance is 7.82, which is less than the

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.Roy and Banerjee 83 observed value. So, null hypothesis is rejected. We may thus conclude that there is a structural difference among risk groups of fan industry in respect of their assigning highest priority to external environmental factors.

Similarly, we may extend our study for testing of similar hypothesis for internal factor selection using Table 9 as given below.

Table-9 Frequency distribution of Managers according to Risk and most important Internal factor Risk Group Risk Aversive Managers Frequency

Frequency

9

3

12

22

11 1

33 4

Most Important Factor Risk Oriented Managers Frequency Finance Marketing Production Personnel Corporate Resources Total

3 3

Total

3

6

2

8

43

17

60

Here, null and alternative hypotheses are Ho : there is no structural difference among risk group in respect of their assigning highest priority to internal environmental factors.

HA : there is a structural difference among risk group in respect of their assigning highest priority to internal environmental factors.

In this case degrees of freedom is equal to (r-I) (c-I) = (5-1) (2-1)

= 4. The observed value of X2 test statistics is (0.0186+ 0.1151 + 0.0062 + 0.3360 + 0.0124 + 0.0471 + 0.2912 + 0.0156 + 0.85 + 0.0312) 2

1.7234. The critical value of X

at 5% level of significance

=

is 9.49.

Which is greater than the observed value. So null hypothesis is accepted.

We may conclude that there is no structural difference among risk group of fan industry in respect of their assigning highest priority to internal environmental factors.

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84 Important Factors for Strategy Formulation in Fan Industry

i

Thus, we may find an interesting difference between the behavioural patterns of two different risks taking groups. Findings show that risk aversive managers are more concerned about changes or reaction of external factors and are unwilling to take major decisions whereas risk oriented managers are also conscious about the environmental parameters but simultaneously they are eager to take decisions under uncertainty.

Thus, we may conclude that risk aversive managers basically want to adopt the reactive style of decision-making. Risk oriented managers on the other hand, are generally in a proactive mode of operation. Reasons behind these are existence of fiercely competitive forces, seasonal market opportunities, pricing and promotional policies of existing players, threat from new entrants, low infrastructure development rate, shrinking of institutional market opportunities and threat from cooler markets. While risk oriented managers are in favour of turning these uncertainties in their favour, risk aversive managers are trying to maintain a cautious approach.

F ACTOR MATCHING BASED ON SINGLE INTERNAL TOR AND SINGLE EXTERNAL FACTOR

FAC-

A successful business operation can only be continued profitably if there is adequate scanning and subsequent matching of internal and external factors. A planner's task is to finalize strategy considering priority levels of both internal and external factors. After studying the most important internal and external factors in their marginal domains one may go for a cross-classification study where on one side one can consider the most important internal factor and on other side the most important external factor. From this cross-classification study one can easily see the interaction among the most important internal and external factors. Further, one may examine how an enterprise, using proper environmental scanning, may out-perform its competitors in the long run. As we know after the liberalization of Indian economy, organizations are facing a continuous turbulent environment due to threats within and outside of the performing industry. Proper matching of internal and external factors is almost essential to draw a specific strategic plan. However, since the degree and nature of environmental analysis depends on the risk taking propensity we like to study the nature of factor matching classified according to this value system.

Management

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~

1:

Roy and Banerjee 85 We present in Table 10 the two-way classification of the risk oriented respondents based on most important internal and external factor combination.

Table-tO Two Way Cross-Classification Table for risk oriented managers on Most Important Internal and External Factor Freq uency of

Most Important Finance

s: ~ ;'C

:.

0

a"

t'i ><

..•••

~ " .,., ":?,

Marketing

Production

Internal Personnel

Factor Corporate Resources

Economic

Total

4

Govt./Legal Market

2

MarletiCompetitive

6

4

16

Supplier/Techno logical

2

2

5

2

29 5

Geographic/Social

1

'5;

Total

9

22

3

3

6

43

Based on this table we propose to carry out the test of association of the factors by using chi square test statistics to identify whether factor matching is at all important for planners of fan industry. In case they are associated, we calculate the degree of association between external and internal factors by using the celebrated Tschupraw coefficient of association.

To get rid of zero frequencies, we have clubbed social and geographical factors. The basic objective behind this clubbing is to increase the efficiency of the test procedure. According to risk oriented managers, let E ;~OM be the most important external environmental

factor and

E;WM be the most

important internal environmental factor. Here, null hypothesis to be tested is Ho:

E ;~OM and

E ;WM are independent factors.

and alternative hypothesis is HA: E;;OM and E;WM are associated factors. dependent factors.

The corresponding alternative hypothesis is Management

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Ho: EH and E, are in-

Volume 8, Number

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86 Important Factors for Strategy Formulation in Fan Industry

HA:

EH and E

j

are associated

factors.

The corresponding test statistic is the

X2 statistic for association of

attributes. The hypothesis Ho will be rejected or accepted if the observed value

0f

X

2

excee ds

a-point of the X

2

2

Xa,(k-I)(I-1)

or not,

2

Xa,(k-l)(I-1)

b'e111gt he upper

distribution with df (k-l )(/-1). The observed value of

X2 test statistic is 27.63. At 5% level of significance, critical value of X2 statistic for degree of freedom (5-1) (5-1 )=16, is 26.296. Hence, we reject the null hypothesis in favour of HA. As a result, we can say that factors are associated and hence factor matching is essential.

To study the degree of association we have used Tschupraw coefficient. The coefficient of contingency for this case is C=0.6255 and Tschupraw coefficient T=OA007. It indicates a moderate degree of association between external and internal factors.

From this table 10 one can also note that 37.20% of risk-oriented managers favour marketing as the most important internal factor to be matched with the market/competitive factor, the most important external one. For risk oriented managers no other factor combination has that much importance. We may justify this observation by noting that due to their risk-taking attitude risk oriented managers want to remain aware about market developments and are always in a proactive mode of operation. Obvious reasons behind this in fan industry are fiercely competitive forces associated with seasonal market opportunities. As fan is a very low technology product, the branded fan market is facing a significant threat from the unorganised sector. In India, a large number of people are in lower income group. So, there is a good demand for low priced models from the unorganised sector. Presently the unorganised players grab more than 60% fan market. It is a major threat for future market growth of branded fan industry. Further, due to price war extraordinary product features cannot be offered. Till date, there are no MNCs in this product field but there is a huge potential of threat from foreign players in near future. Automatically, to get an edge over competitors, intelligent marketing activity and market study are the only answers as viewed by risk-oriented managers.

Management

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Roy and Banerjee 87 Similarly, the findings based on responses of risk-aversive managers on most important internal and external factors are presented in Table 11.

Table-IO Two Way Cross-Classification Table for risk oriented managers on Most Important Internal and External Factor

We have carried out a test for association of these factors by using

;C2 test statistics to identitY the importance of factor matching as viewed by the risk aversive respondents of fan industry. Null hypothesis to be examined is Ho: E~~AMand E ~IAM are independent factors.

The alternative hypothesis is HA:

E~~M

and E ~IAM are associated factors,

where E~~ is external environmental factors and FE ~IAM is internal environmental factors for risk-aversive managers. The observed value of

;C2 test statistic is 10.715. At 5% level of significance, critical value of ;C2 statistic for degree of freedom (5-1) (5-1)=16, is 12.592. Hence, we accept the null hypothesis. This means that risk aversive managers have a weak inclination towards factor matching and due to their cautious reactive mode of operation they normally try to imitate successful strate-

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88 Important Factors for Strategy Formulation in Fan Industry

gies of market place to play safe and do not give a very clear stress on factor matching.

One can easily see that irrespective of whether a respondents assigns preference on different external and internal factors combination, 41.17% of risk-aversive managers favour marketing as the most important internal factor to be matched with the market/competitive, the most important external one. We may also conclude that for risk aversive managers no other factor combinations have that much of importance.

So, causes behind this response are possibly same as those mentioned earlier in the context of risk oriented managers. However, the above study clearly points out that the mode of planning and the matching procedure are somewhat different for different risk groups.

CONCLUDING

REMARKS

This research has not only established the need for proper environmental analysis but also identified main factors of external and internal environments for fan industry. It is advocated that organizations should go for an information based SWOT analysis to know their competitors and direct the execution of strategic move. No amount of intuition, experience, gut feeling may be helpful. In this process we have raised some issues.

Major questions are; what should be company's way of nurturing competitiveness in a profitable way? What are the major factors that playa major role for strategy formulation? Does the strategic stance adopted by marketers is firm specific? What should be the behaviour of a new entrant in any product field to make its entry fault free?

Major findings may be presented in a summarized form for easy understanding. â&#x20AC;˘ Among risk oriented managers 67.44% respondents consider market/ competitive factor as the most important external factor. Economic factor is the second most important one (18.60%). Among the risk aversive managers 52.94% consider market/ competitive as the most important external factor. Social/ geographical factor is occupying the second rank with a support of 29.41 % of respondents. â&#x20AC;˘ Nearly 51.16% of risk oriented managers consider 'marketing' factor as the most important internal factor and 20.93% of risk oriented managers think 'finance' as the second most vital factor. Again, 64.70% of risk aversive managers consider 'marketing' as the most Management

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Roy and Banerjee

89

important internal factor. Their second choice is finance, which enjoys support of 17.64% respondents.

Inferences There is a marked difference between the internal and external factors according to their importance when we are considering classification based on propensity to risk. In both the cases most important external and internal factors are market/competitive and marketing. But the second factor of importance is different for two risk groups. So, we may infer that factor importance varies with the degree of inclination towards risk of respondents. â&#x20AC;˘

37.20% of the risk-oriented managers favour marketing as the most important internal factor to be matched with the market/competitive, the most important external factor. 41. I7% of risk-aversive managers favour marketing as the most important internal factor to be matched with the market/competitive, the most important external one.

In real term, the most important factor matching is not adequate to provide guidelines for a complete decision-making. To have a greater insight, planner should also consider second most important factor matching.

REFERENCES Aguliar, F. J.(J 967): Scanning the Business Environment, Macmillan, New York.

Bibault, D. B.(J 982): Corporate Turnaround, McGraw Hill New York.

Elenkov Detelin S. (J 997): Environmental Scanning Systems and Performance: An Empirical Study of Russian Companies, Journal of Management Development, Vol. 16, No.2, pp. I 11-124 Gluec, W. F. (1980): Business Policy and Strategic Management, Student Edition, McGraw Hill.

International

Gorkin, M. (2000): Creative Risk-Taking for High Performance The Art of Confronting Your Intimate FOE, The Stress Doc. Hambrick, D. C.(l981): Specialisation of Environmental Scanning Activities Among Upper Level Executives, Journal of Management Studies, 18, pp. 299320.

Hofer, C. w., & Schendel, D. (J 978): Strategy Formulation: Analytical Concepts, St. Paul, MN: West Publishing.

Management

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r 90 Important Factors for Strategy Formulation in Fan Industry MacKinnon, D. W. (1975): IPAR's Contribution to the Conceptualization and Study of Creativity," in Taylor, Irving and Getzels, J.w. (eds.) Perspectives in Creativity, Aldine Publishing Co.: Chicago.

Miles, R. E., (1982): Coffin Nails and Corporate Strategies, Prentice-Hall, Englewood Cliffs, NJ. Porter, M. E. (1991): Towards a Dynamic Theory of Strategy, Strategic Management Journal, 12 (Special Issue), pp. 95-117 Prahalad, C. K., & Hamel, G. (1990): The Core Competence Of The Corporation, Harvard Business Review, 68 (3), pp. 79-91 Roy, D. (1997): Strategic Management- Indian Experience, Gyan Publishing House, India.

Snow, C. C., & Hrebiniak, L. G. (1980): Strategy, Distinctive Competence, and Organizational Performance, Administrative Science Quarterly, 25, pp. 317-336.

Van de Ven, A., Joyce, W.F. (1981): Perspectives in Organization Design And Behavior, John Wiley and Sons, New York, NY. Wadha, C. D. (1974): Environmental Planning for Corporate Planning, Economic and Political Weekly, vol.9, March issue.

Management

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DEMOGRAPHIC VARIABLES AND JOB SATISFACTION AMONGST MONGOLIAN AND UGANDAN EMPLOYEES

Mirza S. Saiyadain

Zolzaya Demberel

Marian

Murerwa

This study was conducted to examine the effect of age, gender, years of education and work experience on job satisfaction both across and amongst Mongolian and Ugandan employees. Data was collectedfrom 120 Mongolian and 100 Ugandan employees. The Mongolian sample consisted of 56.7% male and 43.3% female employees. They had an average age of 35.8 years with about 8 years of experience. Majority of them had college level education. In contrast, the majority of Ugandan sample consisted of female employees. The average age was 33.7 years with 6.4 years of work experience. Majority qfthem had senior school education. The results show that Ugandan employees have higher Score on job satitifaction as compared to Mongolian employees. Demographic differences did not interact with country differences. However, asfar as demographic differences within the Country are concerned, some of them were found to be significant. Mongolian employees of the age of25 and below and Ugandan employees between 3135 years of age were found to be more satisfied than the other age levels in their respective countries. Mongolian employees with 1-5 years of work experience and Ugandan employees with 6- 1 0 years of work experience were found to be more satisfied with their jobs than other employees of varying work experience in their respectivecountries. Differences in gender and years of education did not make any significant impact either across the countries or within the country. The trend analysis shows decreasing satisfaction with increasing age of employees in both the countries. However, there is a quadratic relationship between age and job satisfaction for Mongolian 'employees only. Work experience shows an inverse relationship with job satisfaction but onlyfor Mongolian employees. This isfurther supported by a significant deviation from quadratic trend.

R

View of the literature reveals that the demographic variables contribute significantly to the degree of job satisfaction experi nced by employees. Satisfied employees have been found to be different from dissatisfied one's in age, gender, years of education, and work experience. Further analysis shows that some of these differences Management

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~ 2004 Institute

Volume 8, Number

for Integrated

Learning

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in Management.

All Rights Reserved.'

92 Demographic

Variables and Job Satisfaction Amongst

may be universal while others may vary from country to country and study to study in the same country.

Age and Job Satisfaction This seems to be truer for the relationship between age and job satisfaction. While most of the studies in the West, by and large, showed a negative relationship (e.g. Kay, 2000), there is some evidence to suggest that it may be curvilinear as in case of a national sample of British workers (Warr, 1996) or positive for an American sample (Lee and Wilbur, 1985). In other parts of the world same trends seemed to prevail. Studies on Nigerian samples have found positive relationship between age and job satisfaction (Saiyadain, 1985; Sokoya, 2000), which is the same as in Malaysian sample (Saiyadain, 1996). However, Indian samples have been found to show a curvilinear relationship (Dhawan, 200 I) as well as linear relationship (Nazir, 1998). While German sample showed no relationship between age and job satisfaction (Grund and Sliwka, 2001), a study based on Korean sample showed a U shape relationship between age and job satisfaction (AIm et.al. 2001). Some of the reasons for wide variations across cultures could be related to high expectations that employees develop as they grow old which are often nullified by routine nature of the job. Additionally, over qualification and lack of authority and control at the beginning of one's career can also affect the job satisfaction of the employees.

I

I

I

I

Gender and Job Satisfaction An examination of the relationship between gender and job satisfaction across countries by and large showed no difference between male and female samples. For example studies on samples from India (Saiyadain, 1985), USA (Mannheim, 1983), Nigeria (Saiyadain, 1985), Germany (Grund and Sliwka, 2001) and Malaysia (Saiyadain 1996) did not find gender differences influencing job satisfaction scores. However, studies on British sample (Clark, 1997), Arabic sample (Kalantan et.a!. 1999) and Korean sample (Ahn et.al., 200 I) showed that females are more satisfied with their job than males. Women who join jobs as career as against those who work for economic reasons only may experience greater job satisfaction.

1

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Education and Job Satisfaction The relationship between education and job satisfaction showed a general trend of inverse relationship in samples from Nigeria (Saiyadain, 1985; Sokoya, 2000), USA (DeSantis and Drust, 1996) and India (Saiyadain, 1985). However studies based on Malaysian sample (Saiyadain, 1996) and Korean sample (Ahn et.al., 200 I) showed a positive relationship. Another study based on German sample indicated that education did not significantly contribute to job satisfaction (Grund and Sliwka, 200 I). Perhaps over qualifications may have contributed to decline in satisfaction, as full capacity is not completely utilized by the job contents.

Work Experience and Job Satisfaction Job satisfaction has been found to be influenced differently by different years of work experience. In samples from some countries the relationship has been found to be positive. For example, studies in India (Saiyadain, 1985), Nigeria (Sokoya 2000; Saiyadain, 1985) and Malaysia (Saiyadain, 1996) have shown that job satisfaction increases with increasing years of work experience. On the other hand, Kalantan et.al (1999) found a negative relationship amongst Arabic medical professionals and Saiyadain (1985) found that job satisfaction increased with increasing years of work experience amongst Nigerian employees and then showed a decreasing trend with increasing years of work experience. Once again high expectations with increasing years of experience in terms of authority and control might have influenced the degree of satisfaction.

The foregoing review of literature on the relationship between demographic variables and job satisfactions suggests that there is little in common across cultures to justify uniformity in the relationship between demographic variables and job satisfaction. It seems that variations in cultures influence variations in job satisfaction. Hence a study of the relationship between biographic variables and job satisfaction across cultures is necessary to appreciate the rationale and justification for these differences.

Knowing the profile of satisfied employees has some distinct advantages. It helps in developing appropriate policies of recruiting those employees who would experience greater satisfaction. Satisfied employees are more likely to give some thing back to the organization, as they want to reciprocate their positive experience. The feeling of organizational Management

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94 Demographic Variables and Job Satisfaction Amongst

citizenship makes them more helpful to co-workers, less complaining and more positively disposed to organization (Moorman, 1993). These are the traits that are of immense significance to developing nations.

The purpose of the study is to examine the effect of age, gen'der, years of education and work experience on job satisfaction both across and amongst Mongolian and Ugandan employees.

Mongolia and Uganda, though geographically apart are developing economies. Both of them have recently been liberated from unwanted domination and are trying to establish their identity. One third of Mongolian GDP disappeared in 1990-91 at the time of dismantlement of USSR driving it into deep recession. Mongolia is now trying to accelerate economic growth through industry and service sectors (amounting to 70% GDP) through domestic privatization and foreign investment.

Ugandan economy on the other hand, is largely agriculture based employing over 80% of workforce. The new industrial policy is performance based consisting of improved incentives for production and export and reduce inflation. A little over 30% of Mongolian population and about 25% of Ugandan population are gainfully employed in various sectors of economy. A study of their satisfaction with the job can help in developing relevant strategies to attract and retain employees to boost productivity and efficiency for sustained national growth.

METHODOLOGY Questionnaire: Wanous and Lawler (1972) in their study found that 23 operational definitions based on 23 facets of job satisfaction did not yield empirically comparable measure of job satisfaction. Some of them correlated better with the overall ratings of job satisfaction than others.

Hence they suggested that an overall measure of job satisfaction might provide more dependable data. Following four statements were presented to the respondents: I. I am satisfied with my job 2. I love to come to my job every day 3. If I would start my life again, I would choose my present job.

4. I would strongly recommend this job to my friends and relatives.

They were asked to indicate their agreement/disagreement with these statements by using a six-point scale (6 = Strongly agree; 5 = Agree; 4 = Agree a little; 3 = Disagree a little; 2 = Disagree; I = Strongly disManagement

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agree). In addition they were also asked to indicate their gender, age, years of education and work experience.

Since Ugandans are proficient in English language, the English version was used for them. However, in case of Mongolian sample, a person proficient in both languages translated the questionnaire in Mongolian language. Another person proficient in both languages translated subsequently Mongolian version back in English. This was done to ensure that deviations from original are taken care off.

Method of Data Collection and Sample: Questionnaires

were mailed to colleagues in respective countries with instructions to get them filled out by a randomly selected sample of employees in both the countries. The filled out questionnaires were sent back to the second and third authors who were undergoing a course in management in India. In case of Mongolia, 200 and in case of Uganda 150 questionnaires were sent.

From Mongolia 129 and from Uganda 107 completed questionnaires were received out of which 9 from Mongolia and 7 from Uganda were found to be incomplete. They were dropped from the analysis leaving final samples of 120 from Mongolia and 100 from Uganda. They represented 60% and 66.6% response rate from Mongolia and Uganda respectively.

RESULTS Table-l presents the sample profile of respondents from the two countries.

Variable

Table-l Sample Profile Mongolia N=120

Uganda N=lOO

GENDER

Male Female

AGE (years) Mean SD EDUCATION High School Senior School College University

56.7% 43.3% 35.85

7.36 08.33% 20.83% 62.51% 08.33% Change Volume 8, N Managemen t & '

48.0% 52.0% 33.73 4.47 13.00% 39.00% 14.00% 34.00% umber 1 & 2 (2004)

-

."

96 Demographic

Variables

and Job Satisfaction

EXPERIENCE Mean SD

(years)

SD =0 Standard

Deviation

Amongst 6.42 7.18

8.42 5.89 Estimate.

There are more female respondents in Ugandan sample unlike Mongolian sample. Age-wise both samples are in early thirties. However, there are more Ugandans who have about 12 years of education as compared to 15 years of education in the Mongolian sample. In terms of work experience both samples have almost about 6 to 8 years of work experience.

To get a single measure of job satisfaction, inter item correlation among the four items for the sample of 220 respondents was calculated.

The values of coefficients are given below.

Statements Statements Statements

1 and 2; r 1 and 3; r I and 4; r

= =

=

Statements 2 and 3; r Statements 2 and 4; r Statements 3 and 4; r

.600 .401 .440

=

= =

.453 .293 .461

Since all the values of coefficients are significant beyond the conventional levels of significance, their individual scores were added to get a single score, which ranged between 6 to 24.

The means and standard deviation estimates of job satisfaction bY' four demographic variables are presented in Table-2. .

Table-2 Job Satisfaction

Score Uganda

Mongolia

Variables

N

M

SD

N

M

SD

GENDER Male Female

68 52

14.08 14.42

2.71 2.24

48 52

16.20 16.23

3.50 2.19

AGE (Years) 25 and below 26-30 31 -35 36-40 41 and above

14 21 20 35 32

17.07 14.42 13.80 13.39 14.00

2.49 3.58 4.01 3.45 4.54

24 25 22

16.66 17.00 18.36 17.30 14.42

3.01 4.64 4.19 1.60 4.02

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Saiyadain, Demberel and Morerwa EDUCATION High School Senior School College University EXPERIENCE (Years)

10 25 75 10

14.80 15.12 13.97 13.40

426 3.71 4.26 2.57

13 39 14 34

17.77 15.38 17.86 15.91

97

3.32 4.08 3.52 3.73

1-5 years 45 15.57 3.04 71 16.52 3.75 6-10 years 42 13.71 3.59 13 17.07 2.94 1I or more 33 13.06 4.34 16 14.18 4.51 N = Number of Cases; M = Average; SD = Standard Deviation Estimate

Tables 3 to 6 present the results of two-way analysis of variance between countries is and demographic variables. Results based on country X gender show a significant difference between countries (F == 13.16, df 1 == 1/216; P<.O ) suggesting thereby that Ugandans on an average have higher Scores on satisfaction (M == 16.21) as compared to Mongolian sample (M == 14.25). With in country gender differences or interaction effect is insignificant.

Table-3 Analysis of Variance (Country ~

Source

Country (C) Gender (G)

CXG Error !otal

**

SS 220.56 1.71 1.14 3619.3 3842.71

df

MS

F

I I

220.56 1.71 1.14 16.75

13.16** 0.10

I

216

om

219

p < .01

Table-4 Analysis of Variance (Country

=

Source Country (C) Age (A)

CXA Error ~tal p < .01

**

X Gender)

SS 119.98 247.25 84.98 3382.43 3834.64

Management

df

1 4 4 210

X Age)

MS 119.98 61.81 21.25 16.17

F 7.44** 3.83** 1.32

219

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98 Demographic Variables and Job Satisfaction Amongst Table-5 Analysis of Variance (Country X Education) Source

SS

df

Country (C) Eduction (E) CXE Error

209.43 56.36 62.90 3518.51

3 212

Total

3847.19

219

"

.J

MS

F

209.43 18.78 20.96 16.59

12.62** 1.13 126

**P<.OI

Table-6 Analysis of Variance (Country Source Country (C) Experience (E) CXE Error Total

X Experience)

SS

df

MS

126.8 163.8 48.36 3402.2

1 2 2 214

126.8 81.9 24.1 15.8

3741.16

219

F 8.02** 5.18** 1.52

As far as country by age differences is concerned (see Table 4), there are significant differences between countries (F = 7.44, df 1/216, P<.OI) . The Ugandans have higher average (M = 16.75) as compared to Mongolians (M = 14.54). The differences in various age groups within the country are also significant (F = 3.83; df= 1/216; P<.OI). Age wise differences show that Mongolian of the ages of 25 and below are most satisfied (M = 17.07) while in case of sample Ugandans those between the age group of31-35 are most satisfied with their job (M = 18.36). The interaction effect fails to reach the level of significance.

The job satisfaction scores from the samples of two countries show significant country differences (F = 12.62; df= 1/212; P = <.01). It seems the Ugandans are more satisfied (M = 16.73) as compared to Mongolians (M=14.32). However, there are no significant differences within Management

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countries because of varying years of education or their interaction with country.

Table 6 shows significant country (F=8.02; df = 1/214; P <.0 I) and years of experience (F = 5.18; df= 1/14; P<.OI) differences. Ugandans are more satisfied with their jobs (M=15.92) as against Mongolian (M = 14.11). However, within country while Mongolians with 1-5 years of experience are more satisfied with their jobs (M=15.57), Ugandans with 6- IO years experience show greater satisfaction with their job (M=17.07).

Figure I presents the averages of job satisfaction scores of Mongolian and Ugandan respondents onthree demographic variables (age, education and years of work experience).

To examine if different levels of age, education and years of work experience contribute differently to job satisfaction, trend analyses were carried out. The results are presented in Table 7-12. As far as age is Figure-l of Job Satisfaction with demographic

Relationship 18.50 18.00

c

0

:;:: Col

-

oS

17.00 16.50

"

/ \

17.50

/

J

"

~ ~ 15.50

rJl

.., 0

\ \ \

.~ 16.00

"

\

\

factors

I \ I \ \ \ I \ \ I

/\ \

/

V

\

15.00

\

14.50

~

\ \ \

\

14.00 13.50

~

13.00 3

4

5

Age

2 Education

4

2

3

Experience Mongolia

- - - - Uganda Note: For explanation of numericals on the horizontal line see Table 2.

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tOO Demographic

Variables

and Job Satisfaction

Amongst

concerned there seems to be decreasing job satisfaction with increasing age both in cases of Mongolia (F=6.49; df= 1/115; P<.Ol) and Uganda (F=4.64; df=1I89; P<.05). However, Mongolian sample also shows a statistically significant quadratic trend (F=4.03; df=l/1 15; P<.05). Years of job experience also contribute to the job satisfaction in Mongolia. With increasing years of experience job satisfaction decreases (F=7.42; df= 1/ 113; P<.O1). This is further supported by significant deviation from quadratic trend (F=3.75; df=1/113; P<.OS). The rest of the trends for both the samples are insignificant.

Table-7 Trend Analysis (Mongolia

-

- Age)

~,

Source Between Linear Deviation Quadratic Deviation Error

from linearity from quadratic

SS 142.31 108.22 34.09 67.10 75.21 1915.16

Table-S Trend Analysis (Mongolia Between Linear Deviation Quadratic Deviation Error

from linearity from quadratic

34.90 15.44 19.46 3.13 31.77 2022.57

Table-9 Trend Analysis (Mongolia Between Linear Deviation Quadratic Deivation Error

from linearity from quadratic

138.03 126.00 12.03 10.45 127.58 1919.44

df

"

.J

3 115

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F

108.22 10.38 67.10 25.07 16.65

6.49** .0.62 4.03* 1.50

15.44 19.46 3.13 31.77 17.58

0.878 1.108 0.000 1.807

126.00 6.01 10.45 63.79 16.98

7.42** 0.35 0.61 3.75*

- Education)

I I I I 115

- Experience)

I 2 I 2 113

** p < .01; * P < .05 Management

MS

I & 2 (2004)

~

..â&#x20AC;˘.

Saiyadain, Demberel and Murerwa Table-lO Trend Analysis (Uganda - Age) Between Linear Deviation Quadratic

from linearity

Deivation Error

from quadratic

97.81 74.88 22.93 20.48 77.33 1467.35

1 4 I 4 89

74.88 5.73 20.48 19.33 16.48

4.64* 0.35 1.27 1.17

p < .05

Table-II Trend Analysis (Uganda - Education) Between Linear Deviation Quadratic

from linearity

Deivation Error

from quadratic

99.06 7.84 91.22 0.77 98.29 1466.1

]

3 ]

"

..J

91

7.84 30.41 0.77 32.76 16.11

0.48 1.89 0.05 2.03

Table-J2 Trend Analysis (Uganda - Experience) Between Linear Deviation Quadratic

from linearity

Deivation Error

from quadratic

82.07 42.12 39.95 32.87 49.20 1483.09

]

2

1 2

93

42.12 ]9.97 32.87 24.60 15.94

2.64 1.25 2.06 1.54

DISCUSSION This study was conducted to examine the effect of age, gender, years of education and work experience on job satisfaction an employees from Mongolia and Uganda. It also intended to study the differences in the job satisfaction Scores between the two countries. The results show that Ugandan employees are significantly more satisfied with their jobs as Management

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102 Demographic Variables and Job Satisfaction Amongst

compared to their counterparts from Mongolia. The trend analysis shows decreasing satisfaction with increasing age for employees in both countries. Work experience also shows an inverse relationship with job satisfaction but only for Mongolian employees.

As far as country differences, irrespective of biographic variable are concerned, the results suggest that Ugandan employees are more satisfied with their job than Mongolian employees. During the Idi Amin era in Uganda and afterwards most business has come in the hands of native Ugandans. Being the owners of enterprise, they experience a greater sense of satisfaction with their endeavor than being the employees.

Mongolia has started economic reforms only recently and still has a long way to go before it becomes an industrial as against agricultural based economy. Despite its rich deposits of minerals, it has not yet been able to exploit them. Most industries being in the hands of Mongolian Government, job security is made available without much satisfaction from the job. Individual employee is still more concerned with toeing the official line rather than experimenting with innovations. The loss of flexibility in performing one's job has taken much of enthusiasm out from the job.

The results suggest no significant differences between male and female samples. This is true for both Ugandan and Mongolian samples. The results are unlike the general trend of fem;:t1ebeing more satisfied with their job as against male samples.

One explanation could be that if women reject role stereotype determined by their gender and pursue careers side by side with their male counterparts, they may experience the same degree of job satisfaction as men (Saiyadain, 1985). In both countries larger number of women are getting education and venturing into jobs not as an economic necessity but as a free choice. They see their chosen occupations as a career rather than stopgap arrangement to enrich the family kitty and are satisfied with it.

It is also reasonable to suggest that job satisfaction will be associated with age for two reasons. Age is likely to lead to greater seniority and so greater autonomy. Younger people in our sample from both countries were very satisfied with their jobs. However, as they spent more time in the same job their satisfaction level dropped as routine and habituation set in. This is supported by significant negative relationship between age and job satisfaction in both the samples. However, in case of Mongolian sample the results also reveal a significant quadratic trend sugManagement

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gesting there by that after certain age the fear of loosing the job and finding alternative draws them to get more involved with the job leading to higher degree of satisfaction with it.

The relationship between education and job satisfaction has been found to vary from country to country. In some countries it has shown an inverse relationship (eg. Sokoya, 2000; DeSantis and Drust, 1996) while in others countries it has shown no relationship or positive relationship. The results of this study show no relationship between education and job satisfaction amongst the two samples. It is possible that there might be a mismatch between the kind and level of education and the nature of the job they perform.

Like,age, results of the relationship between years of experience and job satisfaction show decreasing satisfaction with increasing experience.

Some of the explanations offered for the relationship between age and job satisfaction may be relevant here. What is more important to suggest is that at the beginning of one's career, an employee satisfaction with job may be high because the job requirements may,be seen as challenges rather than demands. However, as the years pass by the system's requirements may become more pre-dominant. As a result the initiative may be substituted by compliance with the requirements of the organizations. Additionally, in developing countries with a large number of unemployed, to be gainfully employed in itself may be more satisfied.

Given the shortage of employment an entry into a profession or job could be very uplifting. In both countries, though there have been attempts to create economic environment for the transition to free market system, the progress is slow and hence the employment generating potential is low (for example the unemployment rate in Mongolia for the year 2000-2001 has been 15%).

While the method used for data collection is straightforward, the methodology of data collection was dependent on others to select the sample. Though an attempt was made to select the samples as randomly as possible, the results may be indicative and may not be fully generalisable to all employees of the respective countries. In a cross cultural study of this kind this is a genuine concern, which to some extend could be managed if the sample size is very large.

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Variables and Job Satisfaction Amongst

REFERENCES Ahn, Joyup. Moon, Sook-lac and Lee, Yun.Shin. (200 I) "Mismatch and job satisfaction of Korean workers". Paper presented at a joint Conference of the Asian Consumers and Family Economics Association 200 I at China. July 46.

Clark, A.E. (1997), "Job satisfaction and gender. Why are women so happy at work?" Labor Economics, 4, 341-372.

DeSantis, V. and Drust, S. (1996) "Comparing job satisfaction among public and private sector employees". American Review of Public Administration, 26(3), 327-343.

Dhawan, S.K. (2001)" Variations in job satisfaction with age: Some empirical findings". Productivity, 42(1), 151-155.

Grund, C and Sliwka, D. (200 I) "The impact of wage increases on job satisfaction: Empirical evidence and theoretical implications". Discussion paper No. 387, IZA (institute for the study of labor).

Kalantan, Khalid.A. AI-Taweel, Ahmed.A. and Ghani, Hamza.A. (1999) "Factors influencing job satisfaction among primary health care physicians in Riyadh, Saudi Arabia". Annals of Saudi Medicines, 19(5),424-426.

Kay, William.K. (2000) "Job satisfaction British Pentecostal Ministers". Asian Journal of Pentecostal Studies, 3(1), 83-97.

Lee R. and Wilbur E (1985) "Age, education, Job tenure, salary, job characteristics and job satisfaction: A multivariate analysis". Human Relations, 38, 781791.

Mannheim, B (1983)" Male and female industrial workers: Job satisfaction, work role clarity and work place performance". Work and Occupation, 10, 113-136.

Moorman, R.H (1993) "The influence of cognitive and affective based job satisfaction measures on the relationship between satisfaction and organizational citizenship behavior". Human Relations, 46, 759-776.

Nazir, A.N. (1998) "Perceived importance of job factors and overall job satisfaction of bank employees". Indian Journal of Industrial Relation 33 (4) 477-496.

Saiyadain, Mirza.S. (1985) "Personal characteristics and job satisfaction: IndiaNigeria comparison". International Journal of Psychology, 20, 143-153.

Saiyadain, Mirza.S. (1996) "Correlates of job satisfaction amongst Malaysian managers". Malaysian Management Review 31 (3), 9-18.

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Sokoya, Sesan.K. (2000) "Personal predication of job satisfaction for the public sector managers: Implications for management practice and development in developing economy". The Journal of Business in Developing Nations, 4, I -11.

Wanous, J.P. and Lawler, E.E. (1972) "Measurement and meaning of job satisfaction". Journal of Applied Psychology, 56, 95-105.

WaIT, P (1996) "Younger and older workers". In Peter WaIT Psychology at Work.

Harmonds worth: Penguin.

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BOOK REVIEWS

v. V. Sople, Legal Aspects of Marketing in India, New Age International Publishers, New Delhi, 2004, price not mentioned.

This book has discussed at length various legal aspects of business which is of immense importance to the students of marketing. Formulation of any marketing plan must be based on certain legal issues. Author has discussed various acts like MRTP,IPR, TRIPS. Consumer Protection Act etc. to facilitate the students with the intricacies of actual life operations. Decision making process becomes very strong while formulating the marketing plan.

The book provides various live cases which talks about legal implications. The book is very useful for marketing professionals. The chapters related to pricing, advertising, channel management, logistics, packaging, elearning, illegal practices etc. talks about Indian Laws & how it influences marketing decisions.

In the free market economies of the countries across the world the governments try to make the marketing exchange process simpler through the policies and legislation. Chapter I clearly talks about three important issues.

1. Protection of the consumers.

2.

3.

Equal access to markets by alI competitors.

Protection of the interest of the society.

Author clearly explained while achieving the business objectives of profits and customer satisfaction, marketing people needs to consider the legal restrictions before implementing the marketing programme based on the COrporate strategy to aVoOidthe legal trap.The Article 38 & 39 of the Directive Principles of State Policy talks about business related legislation which has also been focussed. Chapter 2 deals in how the marketing laws are designed to regulate the deceptive and restrictive trade practices. Consumer Protection Act 1986, Design Act.- 2000, SEBI-2000 etc. These Acts which covers alI areas of marketing empowers the government to protect the consumers and companies for' any illegal outcome. Cases related to Consumer Protection like Surya Flour Mills, Sudha Nursing Home, Spring Meadows Hospital etc. discussed at length.

Management

ÂŤ;)

& Change,

2004 Institute

Volume 8, Number

for Integrated

Learning

I & 2 (2004)

in Management.

All Rights

Reserved.

108. Book Reviews The author has also discussed how in the competitive markets the customers switch oVer to the competitors product if he/she is not satisfied with the products or services of marketing firm. In addition the unsafe product leads to product liability suits and huge damage compensation to the affected consumers. Case of Siddartha Chowdary vs.Uptron India Ltd. Gives a glimpse of unfair trade practices.

In Chapter 8 immense manipulative power of advertising and its capacity to harm the consumer and matters of public interest has also been discussed.

Through various cases book projected various measures which has been taken by the government time to time. In Chapter 9 laws influencing Physical Distribution like Competition Act 2002, Franchising etc. clearly depicted through cases of Godrej GE, Engineers India (P) Limited.

Legal issues related to Product Packaging, Marketing Legislation has been given enough space in Chapter 11 & 12. How to curb fraudulent practices in Packaging & Cyberspace also help the practising managers in understanding the markets. Last Chapter dedicated to ethical and unethical acts.

In nutshell for achieving the marketing objectives under competitive pressure, author has talked in detail various finer legal and ethical issues. This book will definitely help the Marketing students, managers and general consumers also.

Dr. Deepankar Mukherjee, Professor, Institute for Integratd Learning in Management, Lodhi Road, New Delhi-l 10003.

Joseph, Industrial Relations, Towards a Theory of Negotiated Connectedness. New Delhi: Response Books (A division of Sage Publications),

Jerome

2004. 285 pp. Rs. 380/ paper

back.

Unlike the normal book on Industrial Relations, this book focuses on the theory related to the human dimensions of organization/so This brings into focus all the relevant issues, viz, employment contract, job content and context, individual's professional freedom and growth, feeling of belongingness or otherwise with the immediate team and the organization, etc. and their impact on the individual/s in the organization which can take any shade between the two extremes of positive and negative with their attended consequences.

Management

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Book Reviews

109

The central theme of the book is 'connectedness' and to quote the author 'the foundation of this connectedness is the employee contract, employee consent to the terms of the contract and the fulfillment of the contract by the contracting parties'. There are various forms/expressions of this connectedness, and as many as 10 different expressions have been discussed in great detail in the book quoting from the numerous studies from the earlier times (Marx, Weber, etc.) upto mid-eighties. These different expressions of connectedness would have different implications on the conduct of the employeremployee contractual relationships.

As one traces the economic transformation that has taken place between 18th century and now, one would observe the phenomenal change the industry has undergone in terms of technology, process, raw materials, individual knowledge and skills, work environment etc. The importance of Capital (inclusive of human capital) in the industry has evolved over the centuries; so much so, it occupies the centre stage today. Between the period of the exploited worker of yesteryears to today's knowledge worker has emerged the trade union to protect the workers interest. The book covers the whole gamut in great detail in terms of the human dimensions of organization/so In today's highly competitive global/national market the key elements that ensure survival and growth of an industry are speed, innovation, quality, and competitive price. This has lead to transformation in the attitude of the management towards the worker in the industry, atleast among the progressive ones.

It has resulted in the shift from, the Taylor's basic assumption about a worker that he is only interested in money, that he needs to be told what task is to be performed and then monitored, to the Japanese Management beliefs that a worker should be involved in decision making which impacts his work, that he is concerned about his job content and context, and that he likes to be given greater responsibility and authority. This has propelled changes in the work culture which were unthinkable 50 years ago. Delegation, decentralization of decision making, quality circles, team building, partnering with workers for product/process innovations, to name some, are the in things in the industry today. Simultaneously many paradoxical developments have emerged at the global level, and of late in the Indian context also, viz, jobless growth, job insecurity/lack of employment guarantee, individual's alienation, more cooperation between management and trade union, etc. The book goes through all these issues from the human dimensions point of view. In particular chapter nine 'Dynamics of Workplace Connectedness' which is centered around a company's case study and chapter ten 'Industrial Relations as Connectedness' will be found very useful in developing a conceptual framework for evolving Management

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110 Book Reviews a progressive industria] relations to face the present day competition.

On the whole the book is good and rich in theory. Academicians teaching the subject will find it a very useful reading. Besides, it is recommended for researchers and practicing consultants in the field.

VR.Murali Mohan, Professor, Operations and HR Area, Institute for Integrated Learning in Management, Lodhi Institutional Area, New Delhi- 110003.

Rao, T.V., Performance Management and Appraisal System- HR Tools for Global Competitiveness. New Delhi: Response Books (A division of Sage Publications), 2004. 330 pp. Rs. 350/ paper back.

We live today in a Global Village scenario where Indian companies have to face competition both at home as well as in the International Market. The key to success for any company is the value it provides to its customers visa-vis the competitors. It would mean that companies have to regularly monitor their product/service, technology, processes, systems etc. to ensure they are appropriate to the market context. The company may have the best of product/service, technology, processes, etc. but who ensures that they are so operated/maintained/reviewed in order that the deliverables to the customers be it product/service is what is desired? The answer is obvious, i.e. its the people at all levels in the cgmpany.

If people have to give their best to a company, they must have a sense of belongingness to the company and feel it's their own. This can happen only when people feel they are cared, valued (for their contribution), guided, recognized, rewarded, there is growth opportunity, and so on. It is precisely in this context that Performance Management and Appraisal Systems playa major role. The truth is that it's the people who make a success or otherwise of this system. However good the design of the system is, success is derived only when the people own it (system) and do not feel the system belongs to HR department and that it is thrust upon them. One of the tricky areas in the system is Performance Appraisal. Generally in companies it is carried out as an annual ritual where the entire year's individual's performance (efforts and results) is converted into a number for grading purpose which then becomes the basis for increments/salary fixation etc. Though grading of an individual's performance is unavoidable for salary/wages administration, yet the success of the system depends on the spirit and the way it is conducted. Herein the appraiser plays a key role in performance assessment and counseling.

The book touches on all the above key issues and more. It also emphasizes the point that an individual's output is not entirely decided by his caManagement

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pability/competence, motivation, and efforts alone. The equation with the immediate boss and the team (of subordinates/peers/representatives of other departments or functions) influence the overall output. Thus the process is complex. The author therefore discuses about Dyadic performance, its measure in terms of dyadic score with boss (seniors), colleagues, subordinates, and total dyadic score. Other tools, namely, 360 Degree Feedback and Assessment Centers that can supplement the Performance Appraisal system in an individual's assessment/development, are also covered. The book also provides a good overview of the progress of Performance Management Systems in select Indian organizations, such as, Titan, Infosys, Dr. Reddy's Laboratories, etc., besides an overview of Performance Appraisal Systems in some Asian countries, viz, Singapore, Malaysia, Phillipines, to name some.

Overall it is a well written book on the subject which managers, professionals, and those in academics dealing with Personnel and Human Resources Management will find useful and handy.

VR.MuraIi Mohan, Professor, Operations and HR Area, Institute for Integrated Learning in Management, Lodhi Institutional Area, New Delhi- 110003.

Ruma Ghosh Singh, Nikhil Raj and Helen R. Sekar, Hard Labour at a Ten~ der Age: Child Labour in Home-based Industries in the Wake of Legislation, v. V. Giri National Labour Institute, Noida, 2002, pp. 189, price not mentioned.

The stigma of child labour has been haunting Indian economy for quite sometime now in the corridors of international trade and commerce. Needless to say, Indian Government did promulgate the Child Labour(Prohibition and Regulation) Act in 1986. However, the impact of the act could only be judged in terms of hard empirical evidence. It is easy to speculate, as do popular articles in newspapers do the rounds, that given the socio-economic reality of an all encompassing horrendous poverty, the CLPR Act is difficult to implement. However, without empirical evidence such speculative pronouncements will not be well received by the policy formulators. Herein lays the importance and urgency of the book under review. The authors have undertaken a field study in 1999-2000 and taken date from 1000 households in each of the 9 study areas which are known to employ child labour in hazardous industries. The selected hazardous industries and areas are - look (Aligarh), glass bangle (Firozabad), gem polishing (Jaipur), slate (Markapur), carpets (Mirzapur), brassware (Moradabad), matches (Sivakasi), diamonds (Surat) and Management

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112 Book Reviews knitwear (Triuppur). The book gives a mine of information and data, examining in minute details the demand and supply factors contributing to the problem of child labour and in the process addresses the root question 'the impact of the CLPR Act on child labour'. A commendable task by itself, the efforts of the editors and the contributing authors have made the book relevant to its time, context and social, economic, legal and academic worthiness.

The book has 9 chapters corresponding to the 9 locationally dispersed hazardous industries in question where the study was carried out. These chapters are followed by a chapter on conclusions and recommendations. Each of the chapters are standalone in terms of the industry, location and typical socio-economic and legal hurdless that crop up in-so-far the implementation of the act is concerned. Further, all the chapters are so poignantly titled that the reader, at one stroke, not only gets a feel of the gist of the chapter but also appreciates the enormity of the pathos, pain and suffering that is inbuilt in the issue of child labour.

Helen R. Sekar & Noor Mohammed in chapter I, titled "Unlocking the childhood of every Aligarh child" report, among other issues, that the incidence of child labour is much higher in Muslim community, 99% of the sample households are not aware about laws like the Factories Act and CUR Act and the poor financial condition of the family members is the primary reason for children being sent for earning rather than learning.

In the second chapter titled "No colour in little Firozabad lives", Ruma Gosh Singh and Rajeev Sharma explore the state of affairs in the bangle making units of Firozabad. They found that illiteracy is more among the child labour families as compared to the non-child labour families. Further, the high incidence of child labour contributed to the high workforce participation rate (WPR) among child labour households and the income of the children substantially adds to the family income. At Firozabad, the authors found, the implementation of the CUR Act is hampered by shortage of staff in the labour office, the out-of-court settlement between worker and employer even when cases are filed against the employer, and the very nature of bangle production which involves both factory and household sectors. Kanchan Mathur and Ruma Ghosh Singh conclude in the third chapter titled "Glitterless lives of Jaipur's little children" that abject poverty, lack of alternative employment opportunities and a notso-meaningful education system are primarily responsible, among other factors, for the child labour problem in the gem polishing industry in Jaipur.

In the chapter titled "Slateful of misery for Markapur's children, R. Vidyasagar, K. Suman Chandra and Y. Gangi Reddy have investigated into the problem of

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child labour in the slate industry of Markapur. The authors, very interestingly, found that though the number of cases filed in the labour courts has been rising the conviction rate has been only about 18 per cent. The authors recommend that community participation, identifying the child labour prone areas, improving the livelihood sources of the population, social mobilisation, etc. as some of the key target areas that needs to be addressed in order to arrest the exploitation of child labour in Markapur.

In the fifth chapter titled "Knots that tie up children in Mirzapur", Ravi S. srivastava and Nikhil Raj have examined the child labour problem in the carpet industry. The authors found, among other issues, that landlessness and indebtedness are two of the main contributors to the high incidence of child labour in the carpet industry.

The sixth chapter of the book titled "Small sparks in the match industry of Sivakasi" and authored by R. Vidyasagar & Girija Kumarababu investigates into the child labour problem in the two decade old infamous Sivakasi area of Tamil Nadu. Some of the findings of the authors are that there are more female children. in child labour households than in non-child labour households; child labour constitutes almost 32 per cent of the total workforce in the households with working children; parent led school dropout rate is high; the quality of education is poor; and though all the people are aware of the CLPR Act, parents and employers collaborate against any enforcement.

Kiran Desai and Nikhil Raj in the chapter titled "No glow at surat's cutting edge" have dealt in-depth into the helplessness of the legal machinery in addressing the issue of child labour in Surat's diamond industry. The study reveals that though the enforcement officials have registered more than 4000 cases of violation of various regulations, not a single owner had received summon from the court. The authors have also thrown light on Saurashtra's Patel owners who have a powerful influence in the political arena.

In the penultimate chapter titled "Small comfort in Thiruppur knitwear", J. Jeyaranjan, interestingly, conclude from their study that it is not poverty that drives children to work but it is the aspiration of the parents to augment the material resources of the family that the children are sent to work.

Ashish Ghosh and Helen R. Sekar, in the final chapter titled, "Little shine in Moradabad's brassware" report that production of brassware is dictated by terms set by the export market. The exporters along with the owners of the small manufacturing units known as karkhanas have successfully evaded the CLPR Act by securing the Collector's order banning entry of any outsider, including the enforcement officers into the factory premises.

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114 BookReviews However, the authors have also found clear evidence in the industry of gradual withdrawal from the household base thus reducing the pressure on employing child labour. However, though 80 per cent of parents want their children to be educated, in the absence of enough Government schools which are affordable, the children have nothing else to do but to join' the Norkforce.

The above were some of the highlights of each chapter that is likely to ignite the interest of the avid reader and researcher. In fact, such authoritative book on child labour, based on primary data, is indeed rare. The book is highly recommended for both scholars and students of Sociology and Management Science, researchers and anyone who wants to have insight on the hydraheaded problem of child labour.

Devashis Rath, Assistant Professor, Institute for Integrated Management, Lodhi Institutional Area, New Delhi- 110003.

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Sheth, N. R. (1997) "Some Reflections on Management and Change," Management & Change, 1(1): 5-12.

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