primax 618

Transcription

primax 618

Primax International Journal of
Commerce And Management Research
(PIJCMR)
Your GATEWAY to World class Research
• Research Papers • Articles
• Case studies
Primax International Journal of Commerce and Management Research
No.25/A, Nagadevanahalli, Boothappa Temple Road, 80 Feet Ring Road, Jnanabharathi Post,
Bangalore -56, Karnataka, India. Ph: 08971725451
Email: [email protected], [email protected]
www.primaxijcmr.com
Online ISSN: 2321-3612
Managing Editor:
Prof. T. Rajeswari., M.Sc.,M.A(Eng).,M.B.A.,M.A.(Soc).,
Chief Editor:
Dr.K.V. Ramanathan., M.Com.,M.Phil.,M.B.A.,P.D.B.S.,Ph.D.,
Professor- Primax Research Center
Bangalore.
Coordinator:
Dr. V. Selvaraj
Former, Head & Associate Professor,
Nehru Memorial College (Autonomous),Tiruchirappalli
Dr. M. Muthu Gopalakrishnan
Associate Professor,
Acharya Bangalore B School, Bangalore.
Dr. N. Giri Babu,
Associate Professor,
Sri Venkateswara College of Engineering & Technology, Chittoor.
Publisher:
Primax Commerce and Management Research Academy, Bangalore-56
(Karnataka Reg.: 48/159/CE/0103/2013)
Issue:
Special Issue, November 2015
COPYRIGHT:
1. All rights reserved. And Copyright © 2013, Primax Commerce and Management Research
Academy.
2. Reproduction of any part of this Journal in the whole or in part without written permission from the
publisher is prohibited .
3. All rights reserved ISSN: 2321-3604
Contact:
Prof. T. Rajeswari.,
M.Sc.,M.A(Eng.).,M.B.A.,M.A(Soc)
Founder and Managing Editor,
Primax Commerce and Management Research Academy,
No.25/A, Nagadevanahalli, Boothappa Temple Road
80 Feet Ring Road, Jnanabharathi Post,
Bangalore -56, Karnataka, India. Ph: 08971725451
Email: [email protected], [email protected],
Special Issue
November 2015
Page II
Print ISSN: 2321-3604
Editor Desk "
It gives us great pleasure to come out with the special issue of Primax International Journal of
Commerce and Management Research, Bangalore, in connection with the Fourth International
conference on Current Trends in Management Research and its relevance to Indian Industry”
PLACITUM 2015, the flagship event of the Department of Management Studies of Sree Narayana
Gurukulam College of Engineering (SNGCE), Kolenchery, Kerala.
In the wake of several challenges which the growing economies face in the realms of basic necessities
in life, research plays a very vital role drastic changes. It is very important that different stakeholders
unite and collaborate on issues which confront the society. One of the key objectives of research
should be its usability and application. This issue of the journal attempts to document and spark a
debate on the research focused on various areas of management in context of emerging geographies.
The sectors could range from education, Marketing, Tourism, and Finance, Portfolio management,
Human Resources, Competency mapping and service areas. The key focus would however be the
emerging sectors and research which discusses application and usability in societal or consumer
context whether individual or industrial.
Our aim since the start of PLACITUM in 2012 has been to maintain our integrity and increase the
reputation of our conference, papers presented and published as well as to increase the visibility,
impact and the overall quality of our publications.
We thank the SNGCE Management as well as the Director- MBA @ SNGCE for their constant guidance
and support for coming out with this issue of the research journal. We are also extremely thankful to
Dr. K. V. Ramanathan of Primax International Journal of Commerce and Management Research,
Bangalore, for helping us in time to come out with this issue during PLACITUM 2015. The editorial
review board members too had a tough time in selecting the best research articles for this issue. Non
inclusion of articles does not mean that they were rejected because of lack of quality but there were
better ones than those which were not selected. No doubt this should prove as a motivation for the
researchers to work more oin their respective areas with more vigour.
We hope that this issue would provide all researchers in the field of management and commerce with
sparks of knowledge in their areas for their journey in research in the days to come.
Wishing all a happy reading through the pages…..
Editors
Prof. Dr. Deepak Ashok Kumar
Prof. Dr.Hari Sundar.G
“Truth is the most valuable thing we have. Let us economize it”..
- Mark Twain.
Special Issue
November 2015
Page III
Contents
Sl.No.
Title of the Articles
Page No.
1
Efficiency of Receivables and Liquidity Management In Pharmaceutical
Companies In India: An Application of Bathory’s Risk Perception Model
1-7
- Ambily T. Chacko, Dr. Santhosh Kumar.s
2
Customer Satisfaction of Online Banking Services In SBI
- Anupa S, Sibeena Salam
8 - 14
3
Corporate Social Responsibility (CSR) In India - Changing Paradigms and
Challenges
- Babu Jose, R. Venkateswaran
15 - 21
4
A Study on Employee Engagement Among It Sector Employees In Kerala
22 - 25
- C. V. Lolitha, Dr. Johney Johnson
5
A Comparative Analysis of Corporate Social Responsibility Reporting of Public
and Private Sector Banks In India
- Clement Cabral
26 - 34
6
Investor’s Perception Towards Equity and Non Equity Based Investment
Avenues
- Cryshal Mathias
35 - 41
7
A Prediction Model For Organizational Role Stress Based on Back Propagation
Neural Network
- Deepa Mohan, Sudarsan. N
42 - 48
8
Consumer Behaviour Towards Organic Vegetables
49 - 52
- Divya Vijayan, Dr.K.N.Ushadevi
9
A Study of Demographic Variables and Their Impact on Work Life Balance
Practices
- Dolan Champa Banerjee
53 - 57
10
Impact of Mobile Telphony In Rural India - Dr. A. Kumudha, C.R. Shiv Kumaran
58 - 62
11
Occupational Hazards of Women Workers In Garment Sector
63 - 67
- Dr. Pankajakshi. R, Prof. Shailaja.M. L.
12
A Comparative Analysis of Financial Inclusi on Strategies In Banks with Special
Reference to SBI and ICICI
- Dr. Catherine Nirmala Rao
68 - 75
13
Information and Communication Technology & Its Impact on Education
76 - 81
- Dr. Chandra Purkayastha
14
A Study on Impact of Agmark Status In Consumption Pattern with Special
Reference to Tirunelveli City - Dr. D. Janis Bibiyana, S.Sarala Lakshmi
82 - 85
15
Decoding The Young Consumers – A Literature Review
86 - 90
- Dr. Deepak Ashokkumar
16
Strategic Study of The Effects of Perceived Risks and Benefits of Shopping
91 - 104
- Dr. Hari Sundar.g, Dr. D. Sudha Rani Ravindran, & Mr. Ramakrishnan
17
An Exploratory Study on Road Rage and Its Degree of Prevalence In Cochin
City
- Dr. Jacob Mathew Pulikotil, Mr. Jithin Benedict
105 - 110
18
The Impact of Marketing Mix on Customer Satisfaction Towards Laptop
Industry
- Dr. M. B. M. Ismail, Mr. A. L. M. Shameem,& Mr. A. Riswan
111 - 116
Special Issue
November 2015
Page IV
Sl.No.
Page No.
19
Group Differences In The Selection of Fast Food Restaurant: A Use of
Discriminant Analysis
- Dr. M. B. M. Ismail
117 - 124
20
A Study of Working Environment For School Teachers
- Dr. M. B. M. Ismail
125 - 131
21
A Study on Customer Awareness on Green Initiatives with Special Reference
to Selected Private Sector Banks In Ernakulam
132 - 136
- Dr. Prakash Pillai, Mr. Praveen Raj.D
22
A Study on Work Life Balance of Women Employees In BPO Sector
137 - 139
- Dr. R. Devi
23
Association Between Critical, Creative Thinking and Problem Solving In
Accounting Researches : An Overview
- Dr.B. Nimalathasan
140 - 143
24
Emanation of Women-Inherited Business In India – An Insight
- Dr.r. Vimal Nishant
144 - 149
25
Prospects of Green Marketing and ITS Strategies
- Hena. M
150 - 155
26
Mergers and Acquisitions of International Banking. Penetration Strategy In
Emerging Economy of Mexico Banco Santander México and Banca Serfin
Case
- José G. Vargas-hernández, Carlos Enrique Suárez Medina
156 - 162
27
A Study on Customer Satisfaction of Akshaya Centres
163 - 166
- Krishna.r, Ann Alu Mathew
28
Corporate Social Responsibility For Rural India - Mithun Nair, Dr.Hari Sundar.g
167 - 173
29
Influence of Holistic Marketing Orientation on Customer Value In New
Generation Banks In Kerala.
- Mr. Jomon Jose M
174 - 179
30
E-Publishing -A Strategic Overview
- P.M. Manoharan Pillai
180 - 183
31
A Study on Customer Relationship Management with Reference to Bike Show
Rooms
- S. Noor Mohamed Bisool
184 - 190
32
Study about The Bottleneck of Cooperative Banks
- Sanitha A.C
191 - 194
33
Online Shopping In Kottayam: An Empirical Examination of Its Customer
Satisfaction Perspectives
- Sanju P Cherian
195 - 203
34
Consumer Preference Towards Organic Vegetable
204 - 207
- Zita V Bosco, Boniface P.J
35
Post-harvest Value Addition In Jackfruit- Scope For FPO
208 - 212
- Varnana Nair, Dr.p Shaheena
36
A Study on Motives For Entrepreneurial Intentions among Women Telecentre
Owners In Kerala
- Sreejith. S
213 - 216
37
A Study on Quality of Worklife At India Infoline, Cochin
217 -223
- S. Soumya, Dr. N. Ramkumar
38
Strategic Study on Content Analysis of Library Websites With Special
Reference to Central Universities In South India - Sariga T. R, Lakshmi T. R
Special Issue
November 2015
224 - 230
Page V
Sl.No.
Page No.
39
Managerial Challenges and Innovations In Entrepreneurship - Indhra Vinod
231 - 235
40
A State of The Art Review on Supply Chain Collaboration
236 - 243
- Shreejith T. V , Kemthose P. Paul
41
The Impact of Service Quality on Customer Satisfaction and Customer Loyalty
In HSBC Bank In Jaffna District
244 - 248
- Sivapragasam Sivanenthira, Vasanthakumar Kumaradeepan
Special Issue
November 2015
Page VI
EFFICIENCY OF RECEIVABLES AND LIQUIDITY MANAGEMENT IN
PHARMACEUTICAL COMPANIES IN INDIA: AN APPLICATION OF
BATHORY’S RISK PERCEPTION MODEL
Ambily T. Chacko1
Dr. Santhosh Kumar.S2
Abstract
The paper examines thereceivables and liquidity management in listed pharmaceutical companies in India using
Bathory’s Risk Description Model. The article developed and statistically validated two hypotheses that(1) the Credit
Score indicating efficiency of receivables management and(2) the Normalised Working capital to Credit Exposure
ratio signalling liquidity of the different pharmaceutical companies in India are same irrespective of their annual sales
revenue. It was found that the receivables management efficiency and liquidity of the companies do not differ
significantly when the companies are grouped based on annual sales revenue.
Key words: Cash management, credit worthiness, credit risk
Introduction
All firms by their very nature are involved in selling of
goods or services. Although some of these sales are in
cash, a larger share would be on credit. Sales on credit
basis are inevitable in today’s highly competitive business
world to maximize its magnitude and thereby profit.
Liberal extension of credit and its proper management
is very important for both big and small enterprises.
Evidently, the extent to which firms manage their
receivables go a long way to the level of their profit. Profit
may only be called real profit after the receivables are
turned into cash. The management of accounts
receivable is largely influenced by the credit policy and
collection procedure (Nwakaego, 2014). A credit policy
specifies the requirement to value the worth of customers
and a collection procedure provides guidelines to collect
unpaid invoices that will reduce delays for customers
who have not yet made payment for goods and services
and outstanding receivable (Richards, 1980). The
objective of debt management is to minimize the time
lapse between inventory acquisition and completion of
the entire cash conversion cycle (Sharma, 2011).
Excessive or lower level of current assets may negatively
impact firms’ profitability by bringing difficulties in
mediating smooth operation (Wachowitz & Horne,
2004).Apart from the level of composition, there exists
considerable difference in the level of receivables in firms
around the world. (Maksimovic, 2001) presents evidence
that in countries such as France, Germany, and Italy
accounts receivable exceeds a quarter of firms’ total
assets, while Zingales, (1995) find that 18 per cent of
1
2
the total assets of US firms consists of receivables. In
India it accounts for one third of total assets (Ramana,
2013).The study is deemed to be necessary in the light
of brutal competition in the Indian Pharmaceutical market
brought about by production of very close substitute
products
by
firms
(Gilligan,
2005).The
secompaniesalsoseemedsensitive to economic
fluctuations, policy changes and seasonal variations.
Thus, companies resort to various strategies to boost
their sales. As credit extension is one of the old and
prominent measures adopted to maintain a long standing
relation with the customers, assessing the credit risk of
debtors and maintaining the flow of working capital have
become a challenge.
Review of Literature
As stated above, firms typically sell goods and services
on both cash and credit basis. Firms would rather sell
for cash than on credit, but competitive pressures force
most firms to offer credit. When the customers pay these
credits, the firm receives the cash associated with the
original sale. If the customer does not pay an account,
a bad debt loss is incurred (Pinches, 1994).According
to Chambers and Lacey(2011)there are three primary
issues in the management of accounts receivable: to
whom to extend credit, what the terms of credit should
be, and what procedure should be used to collect the
money. Extending credit should always be based upon
cost- benefit analysis, because of uncertainty in future
payment. The latent cost of extending credit is that the
customer will not pay. Ramachandran (2009), analysed
the relationship between working efficiency and earnings
. Research Scholar, P.G. and Research Department of Commerce, St. Peter’s College, Kolenchery, Kerala.
. Associate Professor, PGand Research Department of Commerce, St. Peter’s College, Kolenchery, Kerala.
Special Issue
November 2015
Page 1
before interest and tax of the paper Industry in India found
that cash conversion cycle and inventory days had
negative correlation with earnings before interest and tax,
while accounts payable days and accounts receivable
days related positively with earnings before interest and
tax.
Bathory(1987) in his book” The Analysis of Credit “,
developed a ratio based model of credit analysis. He
opined that greater the quality and quantity of data at
the analyst’s disposal, the better the credit opinion. The
model suggests eight different ratios. They are
Profitability, adequacy, liquidity, comfort margin, debt
capacity and priority debt service ability ratios. He
developed the model in a manner that accuracy and
relevance of the model’s findings are directly proportional
to the age and quality of the historical data. The model
can be intended to be used as general diagnostic tool
for commercial or Industrial sector. Nilsen (2002) who
analysed the magnitude of receivables among Taiwan
manufacturing industry found that, on an average 25 per
cent of current assets was held by receivables. Basu
(2011) who made a study on eight cement companies
using Bathory’s Risk Description Model which primarily
focuses on profitability, liquidity and capital adequacy
revealed that these three ratios influence the credit score
of individual companies and where these ratios are high
the credit scores obtained were also high.
Statement of Problem
The traditional methods of credit risk analysis are
unrealistic and are not cost effective. Usually industries
grant credit based on past experience and customer
behaviour. But a systematic evaluation of credit risk before
granting credit is important. Because once credit is given
the firm has nothing to do other than applying loss
mitigating techniques. A good credit rating increases the
market value of the firm which in turn helps company to
collect funds cheaply. The financial health of a company,
no doubt, depends on its quality of assets. Among those
assets, receivables assume prime importance as it is
the most dynamic and vulnerable compared to other
current assets. Being amounts locked-up with
customers, receivables have a significant role in
Special Issue
determining the magnitude of future cash-flows to service
obligations as when due. Thus, measuring the credit
worthiness of firms and analysing the liquidity position
of the companies are the need of the hour.
Pharmaceutical companies in India, as mentioned
earlier, are facing severe competition and therefore the
resultant receivables are also high. Higher the receivables
higher is the chance of bad debt losses.
Objectives of the Study
The study examines the following facets relating to
receivables and liquidity management of BSE listed
pharmaceutical companies with turnover Rs. 500 crores
and above in India.
1. Efficiency of receivables management by computing
the Credit Score (CS)with the help of Bathory’s Risk
Description Model.
2. Liquidity position based Normalised Working Capital
(NWC) to Credit Exposure (CE) ratio as per Bathory’s
Risk Description Model.
Hypotheses
1. The Credit Score (CS) as per Bathory’s Risk
Perception Model for listed pharmaceutical
companies in India (turnover Rs. 500 crores and
above) are same irrespective of the magnitude of their
annual sales revenue.
2. The liquidity of the listed pharmaceutical companies
in India (turnover Rs. 500 crores and above) in terms
of Normalised Working Capital (NWC) to Credit
Exposure (CE) are same irrespective of their annual
sales revenue.
Research Methodology
The study is descriptive in nature. The pharmaceutical
companies listed in Bombay Stock Exchange
(BSE)having annual turnover of 500 crores or above
constitute the population of the study. Altogether, there
are 46 companies with annual turnover of 500 crores
and above are listed in BSE and a sample of 10
companies are selected form the four turnover based
strata (Table 1). The database of Dion global solutions
Ltd. hosted by moneycontrol.com is the source of data.
(Table - 1)
November 2015
Page 2
Table -1: Population and Sample
Group
Turnover(Rs. crore)
1
500-1000
Population
18
Sample
3
Name of Sample Companies
Strides Arcolab Ltd
Novartis India Ltd
Natcopharma Ltd
2
1001-2500
16
3
Biocon Limited
Abbott India Ltd
Pfizer Ltd
3
2501-5000
6
2
Glaxo Smithkline Pharmaceutical Ltd.
Sun Pharmaceutical Industries Ltd
4
< 5000
8
2
Cipla Ltd
Dr.Reddy’s Laboratories Ltd
Total
46
10
*Ltd- Limited
The Credit Score (CS) and liquidity ratio of the companies are computed based on the specifications of the
Bathory’sRisk Description Model(Alexander, 1987).Pearson’s simple correlation and ANOVA have been applied at
appropriate places. The financial data of the selected companies from the financial year 2006 to 2015 are used for
analysis. As per Bathory’s Model, the following eight ratios are to be computed for determining the CS of the companies.
1. Profitability = Net profit/Capital Employed..................................................... . X1
2. Profitability (cumulative) = Net tangible assets/Total Liabilities……….....…. ..X2
3. Liquidity = Net Profit/Current Liabilities…………………………………...……X3
4. Liquidity = Normalised working capital/Credit Exposure……….…….…..…….X4
5. Capital adequacy = Equity/Current Liability + Credit Exposure……….……... ..X5
6. Comfort Margin = Net Assets/Credit Exposure…………………..………………X6
7. Debt Capacity = Total Assets/Total Liability + Credit Exposure…………...……X7
8. Priority Debt Service Ability = Net Profit + Depreciation/Current Debt….…….X8
In the first ratio return on capital employed is calculated which shows the profitability. Here net profit before interest
and after tax is used. The second ratio reveals the measurement of cumulative profitability of the current year as
well for accumulated periods. In third ratio net profit over current liabilities depicts the credit worthiness of firm when
compared with the traditional ratios of liquidity. This is so because net profit includes some items additional to
current assets like surplus after accounting for depreciation. The fourth ratio also measures liquidity, normalised
working capital by deducting 50 per cent of stock from net current assets. Credit exposure is calculated by taking
25 per cent of Current assets. Capital adequacy of company is measured by the fifth ratio, which implies long term
or permanent capital. Generally company’s’ permanent capital would not be used in normal circumstances to meet
short-term obligation. The fifth ratio is considering equity on the ground that the growth in the share value can, in
many situations, provide firms with further borrowing powers. In calculating the ratios we include credit exposure
(CE) with firm’s current liabilities to show the most severe total of a firm’s obligation. We calculate the sixth ratio by
placing net assets over credit exposure and it is called comfort margin. In most of the cases normalised working
capital/credit exposure produce comparatively high numbers and probably negative. Since, stock is a very substantial
portion of current assets and when we deduct stock from Net Current Assets, there is a very high probability of a
negative figure. It is hoped that net assets will provide a significantly large amount of cover for the small credit
exposure. The resulting ratio should thus throw high positive scores and its effect on the model should accordingly
compensate for the high negative numbers shown by normalized working capital/credit exposure. To assess the
debt capacity of the firm, we calculate Total Assets/(Total Liabilities+ credit exposure). Here, total liabilities mean
all short term and long term obligations, the amount of credit exposure is also added along with the total liabilities.
This would indicate safety margin taking into consideration all known obligations including the credit asked for by
the customer. Such a measurement gives a rough idea of breakup value of the company, where there are all
Special Issue
November 2015
Page 3
obligations of the customer, including our original exposure to crystallise simultaneously. This ratio gives an indication
of safety margin and debt capacity, both of which are the functions of liquidity, capital adequacy and profitability.
The eighth and the last ratio, we place financial flow (gross cash flow) over current debt. All the current liabilities are
not demanded at a time, since calculating current debt, here we take twenty five per cent of firm’s current liabilities.
It is a treatment of priority debt items. For the purpose of the model, the eight ratios are taken into consideration
giving them equal weight for the computation of CS. The CS computation can be expressed as follows.
CS= L*ΣXi
Xi = Variables (i=1to8)
L = Constant Multiplier = 100/8 = .125 (as the model)
The develop Model is thus =.125*ΣXi
Results and Discussion
Bathory’s model is self-explanatory in nature, the main objective is to help the credit analyst, in extracting best
result by using financial statement. The model clearly depicts how the liquidity, profitability and capital adequacy
factors influence the credit score of companies. The companies with all the factors favorable can obtain a high
score. Here, as per the Model, credit score for of each company is calculated (Table 2). The companies with
turnover above Rs. 5000 crore(Group 4) scored the highest credit score of 126.98. However, the next best credit
score is obtained by the Group 1 companies with turnover ranging between Rs. 500 crores and Rs. 1000 crores.
While the Group 3 companies with turnover Rs. 2501-5000 crores got a credit score of 115.80, Group 4 companies
with a turnover range of Rs. 1001-2500 crores got a credit score of 111.3. Noticeably, the credit scores do not
disclose any relationship to the size of the turnover of the companies. This is quite evident from the ANOVA table
(Tables 3 and 4) that there is no difference in the credit scores of different turnover groups of Indian pharmaceutical
companies (p value 0.813). Thus we accept the null hypothesis, CS as per Bathory’s Risk Perception Model for
listed pharmaceutical companies in India (turnover Rs. 500 crores and above) are same irrespective of the magnitude
of their annual sales revenue.
Table - 2: Credit Score of the Pharmaceutical Companies
Note: NWC= Normalized Working Capital, NTA= Net Tangible Assets, E= Equity Shareholders fund, CL= Current Liabilities, TL=
Total Assets, CR.EXPOSU. =Credit Exposure, CD= Current Debt, D= Depreciation, NP= Net Profit, NA= Net Assets, CE=Capital
Employed.
Special Issue
November 2015
Page 4
Table - 3: ANOVA of Credit Score - Comparing Turnover Groups
Comparison
Sum of Squares
Df
Mean Square
F
Sig.
Between Groups
370.531
3
123.510
.318
.813
Within Groups
2331.370
6
388.562
Total
2701.902
9
Source: Authors’ computation in SPSS 22
Table - 4: ANOVA of Credit Score - Comparing Turnover Groups
(I)Turnover
Group
1
2
3
4
95% Confidence Interval
Mean
Difference
(I - J)
Std. Error
2
11.58958
16.09476
.499
- 27.7929
50.9720
3
7.08521
17.99448
.707
- 36.9457
51.1161
4
- 4.08542
17.99448
.828
- 48.1163
39.9455
1
- 11.58958
16.09476
.499
- 50.9720
27.7929
3
- 4.50438
17.99448
.811
- 48.5353
39.5265
4
- 15.67500
17.99448
.417
- 59.7059
28.3559
1
- 7.08521
17.99448
.707
- 51.1161
36.9457
2
4.50438
17.99448
.811
- 39.5265
48.5353
4
- 11.17063
19.71197
.591
- 59.4041
37.0628
1
4.08542
17.99448
.828
- 39.9455
48.1163
2
15.67500
17.99448
.417
- 28.3559
59.7059
3
11.17063
19.71197
.591
- 37.0628
59.4041
(J) Turnover
Group
Sig.
Lower Bound
Upper Bound
In-depth analysis of the individual company’s credit performance on the basis of calculated credit score shows that
Arcolab ltd. has the highest average score for current profitability, liquidity and current debt paying capacity which
helped the company to improve its credit score (141.97).Overall credit score of Arcolab Company is the highest
among the whole group. Novartis has the highest score with respect to cumulative profitability and capital adequacy,
but still the company’s performance with respect to the credit score is below the groupaverage. Natco recorded a
high score with respect to cumulative profitability but while considering the individual score the company could not
outperform the group average. In the case of Group 2 with a turnover of Rs 1001-2500 crores, Biocon obtained
reasonable scores with respect to comfort margin and cumulative profitability; and obtained the highest score in the
group. Even though Pfizer had obtained the highest score with respect to liquidity, the decreased profitability
outweighed the performance reducing the overall credit score to 100.23 much below Biocon. Abbott remained an
average performer in the group. Even though Glaxo recorded decent level of profits its liquidity position was negative
for many years and this led the company to clock the lowest credit score in the whole group. High level of net
assets held by Sun Pharma resulted in scoring the highest positive score with respect to comfort margin(839.20) as
the net assets provided a substantial cover to the small amount of credit exposure. Besides its strong equity base
the company managed to score only an ordinary credit score. The liquidity and profitability position of both Cipla
and Dr. Reddy’s is almost the same, but the huge level of depreciation and high volume of inventory, short term
assets out setting the long term assets weakened the debt repaying capacity of the firms. Besides their huge
turnover, they managed to be only average performers.
The Table 5 reveals the ranking of groups based on the group average of NWC/Credit Exposure and credit score
group average. While Group 2 with a turnover of Rs.1001-2500 stands first in the liquidity measure, it is in the fourth
position in the case of CS. While the Group1 ranked second in both CS and liquidity, Group 4 was placed first in CS
and third in liquidity measure. It also indicates that the short term debt paying capacity is very strong for Pfizer Ltd
and Novartis Ltd. This has resulted in driving their group average to better positions.
Special Issue
November 2015
Page 5
Table - 5: Liquidity Position
Turnover Rs (Crores)
500 - 1000
1001 - 2500
2501 - 5000
<Rs 5000
NWC/
CREDIT
EXPO
Companies
% Cash % CLs
to CAs CAs
Arcolab
0.064
0.444
199.80
Novartis
0.130
0.216
295.46
Natco
0.039
0.657
130.34
Biocon
0.118
0.420
185.76
Abbott
0.355
0.380
179.52
Pfizer
0.381
0.882
296.94
Glaxo
0.429
0.455
189.11
Sun Pharma
0.108
0.597
118.15
Cipla
0.014
0.367
174.86
Dr.Reddys
0.073
0.361
214.84
NWC/
Credit Expo
(Group
Average)
Rank
CS
(Group
Average)
Rank
208.53
2
122.89
2
220.74
1
111.3
4
153.63
4
115.8
3
194.85
3
126.98
1
The ANOVA of Liquidity (NWC/ Credit Expo) depicted in Table 7 confirms that there is no difference in the level of liquidity
of the different turnover groups. The post-Hoc analysis also confirms that there is no difference among the groups.
Thus we accept the null hypothesis that the liquidity position of the listed pharmaceutical companies in India in
terms of Normalised Working Capital (NWC) to Credit Exposure (CE) is same irrespective of their annual sales revenue.
Table - 6: ANOVA –Liquidity of Turnover Groups
Comparison
Sum of Squares
Df
Mean Square
F
Sig.
0.453
0.725
Between Groups
5839.831
3
1946.61
Within Groups
25792.55
6
4298.758
Total
31632.38
9
Table - 7: ANOVA – Liquidity of Turnover Groups
(I) Turnover
Group
1
2
3
4
(J) Turnover
Group
Mean Difference
(I-J)
Std . Error
Sig.
Lower Bound
Upper Bound
2
- 12.208
53.53353
0.827
- 143.2
118.7838
3
54.90635
59 .85231
0.394
- 91.547
201.3597
4
13.68205
59.85231
0.827
- 132.771
160.1354
1
12.208
53.53353
0.827
- 118.784
143.1998
3
67.11435
59.85231
0.305
- 79.339
213.5677
4
25.89005
59.85231
0.68
- 120.563
172.3434
1
- 54.90635
59.85231
0.394
- 201.36
91.547
2
- 67.11435
59.85231
0.305
- 213.568
79.339
4
- 41.2243
65.56492
0.553
- 201.656
119.2073
1
- 13.68205
59.85231
0.827
- 160.135
132.7713
2
- 25.89005
59.85231
0.68
- 172.343
120.5633
3
41.2243
65.56492
0.553
- 119.207
201.6559
Special Issue
November 2015
Page 6
Conclusion
The efficiency of receivables management in
pharmaceutical companies based on the credit score is
found to be more or less same among companies
irrespective of their magnitude of sales. Though the credit
score is visibly high in the case of companies with annual
sales exceeding Rs. 5000 crores, altogether no
significant differences were observed in this regard. As
efficient management of receivables have a significant
stake in keeping up liquidity, quite natural, the companies
do not differ in the matter of liquidity also. Though no
benchmark is available for comparing the computed
credit score, the relative comparison of companies are
conclusive.A closer view of the built-in factors of the
model like profitability and capital adequacy which affect
the receivables and liquidity management couldalso give
clues about these aspects of the Pharma industry.
•
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November 2015
Page 7
CUSTOMER SATISFACTION OF ONLINE BANKING SERVICES IN SBI
Anupa S
1
Sibeena Salam2
Abstract
The Internet has become a vital part of people’s daily lives. It has changed consumer behavior in many ways,
including financial transactions formerly requiring a visit to a bank branch to achieve. Commercial banks have been
in the forefront in utilizing this to meet customer needs for on-demand financial services. A system allowing individuals
to perform banking activities at home, via the internet is online banking. Online banking through traditional banks
enable customers to perform all routine transactions, such as account transfers, balance inquiries, bill payments, and
stop-payment requests, and some even offer online loan and credit card applications. Account information can be
accessed anytime, day or night, and can be done from anywhere. This paper discuss the concept of online banking,
advantages and disadvantages of online banking, products and services offered through online banking and level of
customer’s satisfaction of online banking services in SBI and it conclude that online banking offers unique benefits
to both the customer and bank. And the customer find online banking service that suits his needs because of getting
services more conveniently and secure.
Key words: Online Banking, Customer Satisfaction, Fund transfer, Internet banking.
Introduction
Online banking (or Internet banking or E-banking) allows
customers of a financial institution to conduct financial
transactions on a secured website operated by the
institution, which can be a retail bank, virtual bank, credit
union or building society. To access a financial
institution’s online banking facility, a customer having
personal Internet access must register with the institution
for the service, and set up some password (under various
names) for customer verification.
The password for online banking is normally not the same
as for [telephone banking]. Financial institutions now
routinely allocate customers numbers (also under various
names), whether or not customers intend to access their
online banking facility. Customer’s numbers are normally
not the same as account numbers, because number of
accounts can be linked to the one customer number.
The customer will link to the customer number any of
those accounts which the customer controls, which may
be cheque, savings, loan, credit card and other
accounts. Customer numbers will also not be the same
as any debit or credit card issued by the financial
institution to the customer.
Literature Review
The strategic focus of the banks changed from the
production oriented to customer oriented. Hence the
customers’ satisfaction is indispensable the organization.
Roger (2011) analyses the importance of “Universal
banking in India”. Globalization, liberalization and
1
2
deregulation of financial markets in many developed and
developing countries have resulted in increased
disintermediation and have made commercial banks
vulnerable to interest rate risk. The developments in
information technology and telecommunications are
allowing an international pooling of financial resources,
thereby spreading the risk across more than one market.
Deena Amatev and Mr. Coy (2010) have expressed
their mind in their extract titled “Fleet Helps Customers
do it my way on line”. The two authors have expressed
a positive attitude towards the enhancement of customer
service. Banking organizations, they say, should go
beyond home banking (traditional functions like opening
of accounts, funds transfer, balance enquiries, bills
payment and making proper investment). The two authors
stated that customers should get to know how to explore
the web sites to create awareness of on line products
and services.
Johri and Jauhari (2010) also analyses the “importance
of technology and issues emerging from this technology”.
According to them, technology is emerging as a keydriver of business in the financial services industry. The
advancement in computing and telecommunication has
revolutionalised the financial industry and banking on
the net is fast catching on. As e-commerce gets
transformed into m-commerce with the increasing use
of technologies like WAP, banking business is in for a
major overhaul.
Bhasin (2009) has analyzed the impact of “Information
technology on the banking sector”. Information
. Assistant Professor, A J College of Arts & Science, Thonnakkal,
. Assistant Professor, A J College of Arts & Science, Thonnakkal
Special Issue
November 2015
Page 8
technology has revolutionized the various aspects of our
life. It has transformed the repetitive and overlapping
systems and procedures into simple single key pressing
technology resulting in speed, accuracy and efficiency
of conduction business. The computerization of banks
has provided a major push for enabling them to enter
the newer activities. The banking industry has prepared
itself and is strongly emerging to play a major
supplementary role in nurturing e-commerce
applications.
Objectives
• To identify the Concept online banking.
• To Know about advantages and limitations of online
banking.
• To identify the products and services offered through
Online banking facility.
• To evaluate the satisfaction level of customers on
online-banking services of SBI.
Methodology
The research is based on the customer’s satisfaction
towards online banking services in Trivandrum district of
Kerala. The study is based on the primary data and
Secondary data.
Source of primary data
Primary data collected through well-framed and
structured questionnaires to obtain the well-considered
opinions of SBI customers who operate different type of
accounts. The convenience sampling technique was
followed.
Sampling plan
For the purpose of research a random sample of 100
respondents were chosen from the Trivandrum district
as the State Bank of India’s customers
Sources of secondary data Secondary data were
collected from various banks, books, journals,
magazines, websites etc.
Tools of analysis
Data’s collected were edited and coded for reducing
errors. Appropriate statistical tools such as percentage,
graphs were used for analysis. MS excel was used for
making data analysis.
Online Banking
Online banking is an electronic payment system that
enables customers of a financial institution to
conduct financial transactions on a website operated by
the institution, such as a retail bank, virtual bank, credit
union or building society. Online banking is also referred
as Internet banking, virtual banking and by other terms.
Internet banking, Electronic clearing services, Electronic
Special Issue
Fund Transfer, Real Time Gross Settlement, and Core
Banking etc. are the latest electronic banking services
introduced by banks in India.
Definition
The performance of banking activities via the Internet.
Online banking is also known as “Internet banking” or
“Web banking.” A good online bank will offer customers
just about every service traditionally available through a
local branch, including accepting deposits (which is done
online or through the mail), paying interest on savings
and providing an online bill payment system.
History
The precursor for the modern home online banking
services were the distance banking services over
electronic media from the early 1980s. The term ‘Online’
became popular in the late ’80s and referred to the use
of a terminal, keyboard and TV (or monitor) to access
the banking system using a phone line. ‘Home banking’
can also refer to the use of a numeric keypad to send
tones down a phone line with instructions to the bank.
Online services started in New York in 1981 when four
of the city’s major banks (Citibank, Chase
Manhattan, Chemical and Manufacturers Hanover)
offered home banking services. using the
videotext system. Because of the commercial failure of
videotext these banking services never became popular
except in France where the use of videotext (Minitel)
was subsidized by the telecom provider and the UK,
where the Prestel system was used.
When the clicks-and-bricks euphoria hit in the late 1990s,
many banks began to view Web-based banking as a
strategic imperative. The attraction of banks to online
banking are fairly obvious: diminished transaction costs,
easier integration of services, interactive marketing
capabilities, and other benefits that boost customer lists
and profit margins. Additionally, Web banking services
allow institutions to bundle more services into single
packages, thereby luring customers and minimizing
overhead.
A mergers-and-acquisitions wave swept the financial
industries in the mid-and late 1998s, greatly expanding
banks’ customer bases. Following this, banks looked
to the Web as a way of maintaining their customers and
building loyalty. A number of different factors are causing
bankers to shift more of their business to the virtual
realm.
While financial institutions took steps to implement ebanking services in the mid-1990s, many consumers
were hesitant to conduct monetary transactions over the
web. It took widespread adoption of electronic
commerce, based on trailblazing companies such as
America Online, Amazon.com and eBay, to make the
November 2015
Page 9
idea of paying for items online widespread. By 2000, 80
percent of U.S. banks offered e-banking. Customer use
grew slowly. At Bank of America, for example, it took 10
years to acquire 2 million e-banking customers. However,
a significant cultural change took place after the Y2K
scare ended. In 2001, Bank of America became the first
bank to top 3 million online banking customers, more
than 20 percent of its customer base. In comparison,
larger national institutions, such as Citigroup claimed
2.2 million online relationships globally, while J.P. Morgan
Chase estimated it had more than 750,000 online
banking customers. Wells Fargo had 2.5 million online
banking customers, including small businesses. Online
customers proved more loyal and profitable than regular
customers. In October 2001, Bank of America customers
executed a record 3.1 million electronic bill payments,
totaling more than $1 billion. In 2009, a report by Gartner
Group estimated that 47 percent of U.S. adults and 30
percent in the United Kingdom bank online.
The UK’s first home online banking services known
as Homelink were set up by Bank of Scotland for
customers of the Nottingham Building Society (NBS) in
1983. The system used was based on the
UK’s Prestel view link system and used a computer,
such as the BBC Micro, or keyboard (Tan data Td1400)
connected to the telephone system and television set.
The system allowed on-line viewing of statements, bank
transfers and bill payments. In order to make bank
transfers and bill payments, a written instruction giving
details of the intended recipient had to be sent to the
NBS who set the details up on the Home link system.
Typical recipients were gas, electricity and telephone
companies and accounts with other banks. Details of
payments to be made were input into the NBS system
by the account holder via Prestel. A cheque was then
sent by NBS to the payee and an advice giving details
of the payment was sent to the account holder. BACS was
later used to transfer the payment directly.
Stanford Federal Credit Union was the first financial
institution to offer online internet banking services to all
of its members in October 1994.
Today, many banks are internet only banks. Unlike their
predecessors, these internet only banks do not maintain
brick and mortar bank branches. Instead, they typically
differentiate themselves by offering better interest rates
and more extensive online banking features.
Products and Services Offered Through Online
Banking Facility
Account Summary: Accounts which are ‘Internet
Banking Enabled’ may be displayed along with the
Current Balance, Total Balance, Unclear Balance and
Available Balance etc. (Savings /Current / Overdraft /
Term Deposit / Loan Accounts).
Special Issue
Overdraft Details: Limit and Drawing Power for OD
Accounts, Repayment Schedule for Loan Accounts may
be viewed.
Transactions Details: User may view, download and
print of the last 14 transactions or for specified period of
selected account.
Online Requests: User may request for Stop Payment
for a particular Cheque or Range of Cheques in select
accounts, Revoke of Stop Payment of Cheques already
stopped. User may also change his contact no. (Phone
no., mobile no., email etc.)
Funds Transfer between own Accounts: User may
transfer funds from one account (with requested
transaction facility) to his/her another account to the
extent of fund transfer limit fixed by the bank from time
to time, subject to the available balance, by selecting
‘from’ & ‘to’ accounts.
Adding of Account in Beneficiary List: If amounts
are frequently transferred to a particular account, then
the facility of adding that account in beneficiary list will
be available by providing a nick name to that account.
Viewing of Beneficiary Accounts: User may view all
the beneficiaries that have been added and may also
modify the details of a beneficiary by selecting that
beneficiary.
Fund transfer to other Beneficiary Account: User
may transfer fund from his/her account (with requested
transaction facility) to any other third party account,
maintained with any of our CBS Branch, to the extent of
fund transfer limit fixed by the bank from time to time,
subject to the available balance, by selecting his/her
account and giving either third party’s account number
or selecting a beneficiary.
Standing Order: User may give standing order for
transfer of funds from one account to another to be
executed on a predefined frequency (daily /monthly /
month end). User may also amend or cancel the standing
order so given.
E-Payment Facilities: User may use E-Payment facility
for payment of Direct (CBDT) and Indirect (CBEC) taxes
by debiting the account online and may print cyber receipt
& challan also.
Online Enquiry:
• Cheque Enquiry: User may enquire status of a
Cheque or Range of Cheques issued in an account.
• Cheque Books: User may enquire for Cheque books
issued in an account.
• Outward Cheques Enquiry: User may enquire
status of specific Cheque or all Cheques deposited
in an account.
November 2015
Page 10
•
TDS Detail: User may view the Tax Deducted at
Source details.
Other options:
• Contact Details: User may view address details.
• Change Login Password: User may change login
password as per guidelines available on website.
• Change Transaction Password: User may change
transaction password as per guidelines available on
website.
• Change User Preference: User can change their
User-Id; however the same can be changed only once.
User may set his/her display preference.
• Login History: User may view login history.
Advantages of Online Banking
Many banks have begun to offer customers the option of
online-internet banking, a practice that has advantages
for both all parties involved. The convenience of being
able to access accounts at any time as well as the
ability to perform transactions without visiting a local
branch, draw many people to be involved. Some of these
advantages of online banking but are not limited to,
include:
Customer’s convenience
Direct banks are open for business anywhere there is
an internet connection. They are also 24 hours a day,
365 days a year open while if internet service is not
available, customer services is normally provided around
the clock via telephone. Real-time account balances and
information are available at the touch of a few buttons
thus, making banking faster, easier and more efficient.
In addition, updating and maintaining a direct account
is easy since it takes only a few minutes to change the
mailing address, order additional checks and be informed
for market interest rates.
More efficient rates
The lack of significant infrastructure and overhead costs
allow direct banks to pay higher interest rates on savings
and charge lower mortgage and loan rates. Some offer
high-yield checking accounts, high yield certificate of
Deposits (CDs), and even no-penalty CDs for early
withdrawal. In addition, some accounts can be opened
with no minimum deposits and carry no minimum
balance or service fees.
Services
Direct banks typically have more robust websites that
offer a comprehensive set of features that may not be
found on the websites of traditional banks. These include
functional budgeting and forecasting tools, financial planning
capabilities, investment analysis tools, loan calculators
and equity trading platforms. In addition, they offer free
online bill payments, online tax forms and tax preparation.
Mobility
Special Issue
Internet banking also includes mobile capabilities. New
applications are continually being created to expand and
improve this capability or smart-phones and other mobile
devices.
Transfers
Accounts can be automatically funded from a traditional
bank account via electronic transfer. Most direct banks
offer unlimited transfers at no cost, including those destined
for outside financial institutions. They will also accept direct
deposits and withdrawals that the customer authorizes
such as payroll deposits and automatic bill payment.
Ease of use
Online accounts are easy to set up and require no more
information than a traditional bank account. Many offer
the option of inputting the customer’s data online or
downloading the forms and mailing them in. If the
customer runs into a problem, he has the option of calling
or e-mailing the bank directly.
Environment friendly
Internet banking is also environmentally friendly.
Electronic transmissions require no paper, reduce
vehicle traffic and are virtually pollution-free. They also
eliminate the need for buildings and office equipment.
The Disadvantages of Online Banking
Online Banking seems like an obvious choice to leave
the hassles of traditional money management behind in
exchange for it. However, there are potential problems
associated with banking over the internet of which
customers may not be aware. Consumers need to weigh
the advantages as well as the disadvantages of online
banking before signing up. Some of the disadvantages
of internet banking include:
Bank relationship
A traditional bank provides the opportunity to develop a
personal relationship with that bank. Getting to know
the people at your local branch can be an advantage
when a customer needs a loan or a special service that
is not normally offered to the public. A bank manager
usually has some discretion in changing the terms of
customer’s account if the customer’s personal
circumstances change. They can help customers solve
problems such as reversing an undeserved fee. The
banker also will get to know the customer and his unique
needs. If the customer has a business account, this
personal relationship may help if the customer needs
capital to expand. It’s easier to get the bank’s support if
there is someone who understands customer’s business
and vouch for his operating plan.
Transaction issues
Sometimes a face-to-face meeting is required to
complete complex transactions and address complicated
November 2015
Page 11
problems. A traditional bank can host meetings and call
in experts to solve a specific issue. Moreover,
international transactions may be more difficult (or
impossible) with some direct banks. If customer deposits
cash on a regular basis, a traditional bank with a drivethrough window may be more practical and efficient.
Service issues
Some direct banks may not offer all the comprehensive
financial services such as insurance and brokerage
accounts that traditional banks offer. Traditional banks
sometimes offer special services to loyal customers such
as preferred rates and investment advice at no extra
charge. In addition, routine services such as notarization
and bank signature guaranteed are not available online.
These services are required for many financial and legal
transactions.
Security
Direct banks are subject to the same laws and
regulations as traditional banks and accounts are
protected by the FDIC. Sophisticated encryption
software is designed to protect your account information
but no system is perfect. Accounts may be subject to
phishing, hacker attacks, malware and other unauthorized
activity. Most banks now make scanned copies of
cleared checks available online which helps to avoid and
identify check fraud. The timely discovery of discrepancies
can be reported and investigated immediately.
Figure. 1 :Percentage of Satisfaction Level Of Customers On
Online Banking Services
dissatisfied
12%
highly satisfied 40%
satisfied 48%
Figure. 2 : Percentage Of Satisfaction Level of Respondents On
Offline Services
dissatisfied
28%
highly satisfied 32%
satisfied
40%
Figure. 3 : Preference To Facilities You Are Using With Online
Banking
fund transfer
deposit or
20%
withdrawal 27%
balance
enquiry 21%
bill payment 32%
Figure. 4 : Internal Force For Using Online Banking
Analysis of Customer Satisfaction Of Online Banking
Services In SBI
The data collected from 100 respondents belonging to
the age group of 20-50. Out of this,80 respondents were
interviewed with face to face interactions and 20 were
telephonic interview. (Fig. 1,2,3,4,5 & 6)
Satisfaction on online banking service: Out of the
total 100 respondents interviewed 40% of the
respondents’ were highly satisfied, 48% were satisfied
and 12% were dissatisfied (figure 1).
security
24%
no
22%
yes
78%
Figure. 6 : Do You Feel Any Difficulty With Online Banking
Internal force for using online banking : It was
observed that 26% of the respondents using online
banking because of continence ,32% were using as the
reason of ease of use , 24% as for security and 14%
revealed that was user friendly (figure 4).
Special Issue
ease for
use 32%
Figure. 5 : Do You Think Online Banking Is Secure For
Transactions
Satisfaction on offline service: It was found that the
out of the 100 respondents, 32% were highly satisfied,
40% were satisfied and 28% were dissatisfied (figure 2).
Preference for using online banking: It has been
observed that there to be have several facilities for using
online banking. While conducting the interviews about
27% of the respondents’ preferred for deposits and
withdrawals, 21% preferred for balance enquiry, 32% were
for bill payment and 20% were for fund transfer (figure 3).
convenience
26%
user
friendly 14%
November 2015
yes
27%
no
73%
Page 12
Security in online banking: It was observed that 78%
of the respondents admitted it to be have security in
online transactions, however 22% of the respondents
found it to be insecure (figure 5).
Difficulty in online banking : It was observed during
interviews that 73% of the respondents admitted that
they did not have any problem in related with online
banking where as 27 % admitted that they have some
problems being faced (figure 6).
Discussion
• Analysis 1 After analyzing the responses of 100
respondents through interviews it was observed that
40% was highly satisfied with online banking. Majority
of customers are satisfied with its online banking
services.
• Analysis 2 It was to be analyzed that 32% of
respondents were satisfied with offline banking also.
However the most people satisfied with online banking.
• Analysis 3 To evaluate the preference of facilities in
online banking found that customers are giving more
preference to bill payments (32%) and also used for
withdrawal and deposit purposes, and least
preference for fund transfer (20%). Customers are
using online banking because of its easy procedures.
• Analysis 4 To ascertain the internal force for using
online banking service, the most reason is ease for
use that the 32% of respondents. And 14% of
respondents were using online banking as the reason
of user friendly. The other reasons were convenience
and security.
• Analysis 5 78% of the respondents admitted that
online banking is more secure and provides for
transactions than offline service. 22% of the
respondents said that they are not satisfied with the
security of online banking. A customer believes that
online banking is safe rather than traditional banking.
Customers are satisfied with the online banking
procedure.
• Analysis 6 Major portion of customers are satisfied
in security measured provided by the bank in online
banking large portion of respondents doesn’t have
any difficulties in completing online transaction but
some people’s faces some difficulties. 73% of
respondents does not have any problems with online
banking whereas 27% have being faced some
problems.
Conclusion
Online banking is the modern trend in the banking sector.
It has very significant role in the overall performance in
the commercial banks. The study results show that most
of respondents were satisfied with online banking.
Special Issue
Online banking is an electronic payment system. The
rise of internet banks has increased the competition of
the banking business. Online banking offers unique
benefits and also has some drawbacks. The benefits of
internet banking are undeniable; there are some
inconveniences and concerns of which customers should
be aware of. Online banking provides so many services
such as fund transfer, auditing of accounts in beneficiary
list, e-payment facilities, online enquiry etc. All these
help the customer decides that internet banking is right
for him, he must be sure to review other offers from
several banks. The large portions of respondents are
using internet accounts because it is easy to use. On
the other hand many people have difficulty relying on
the security of online transactions, fearing the very real
possibility of identity theft. We can conclude that the
customers are satisfied in online banking services. Banks
provides various services through internet like deposits,
withdrawals, fund transfer, bill payments, etc. for their
customers.
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CORPORATE SOCIAL RESPONSIBILITY (CSR) IN INDIA - CHANGING
PARADIGMS AND CHALLENGES
Babu Jose1
R. Venkateswaran
2
Abstract
India is an emerging industrial power, which was integrated with the world business regime, by liberalization & new
economic policy, ushered in 1991. As the market forces led the growth principle, focus of public sector was marooned
by the need, to increase productivity and profits from their existence. In India the public sector, laid foundations of
philanthropy in a big way. They were the temples, which imbibed the democratic principles of government. The focus
on social development of all stakeholders was always a part of unwritten cornerstone of public sector existence.
Social awareness programs were the earlier philanthropic programs in the domain of the public sector, which graduated
now to be known as corporate social responsibility programs.
Corporate Social Responsibility can be defined as concept by which companies integrate social and environmental
concerns in their business operations and interactions with their stakeholders. The new legislation made by the
Government of India by the Companies Act 2013 is expected to bring far-reaching changes in the Indian CSR
scenario. The purpose of the study was to assess the effect of the new developments on CSR in Indian Public sector
Firms. Objectives of the study were to: establish the influence & need of CSR in corporate performance contexts,
determine the effect of changes in CSR by the implementation of the new Act, which in turn influences Corporate &
social Governance performance parameters. The main data collection instrument was a structured questionnaire.
Quantitative data was analyzed using statistical tools. The study findings are expected to contribute towards academic
paradigms, and to fill the gap between researched work and un-researched areas.
Key words: CSR, Corporate Governance, Indian Public Sector
Introduction
India is, for the first time, with an expected growth rate
of 7.5 % is leading the World Bank’s growth chart of
major economies as per the release of the latest Global
Economic Prospects (GEP) report in June 2015 with
China growth rate projected at 7.1%. And India has also
figured in top five emerging economies for highest
investment commitments in private sector, infrastructure
sector, energy, transport and water, according to the
World Bank report. The bullish sentiment for India is
due to the domestic demand, reforms, lowering crude
prices, lower external vulnerabilities etc, from the variety
of empirical and thematic understandings, encompassing
different variety of insights; it is felt that improved
economic conditions remain central and pivotal to any
consideration of rise and survival of democracy too.
A mixed approach of economic growth was formulated
with focus on public sector growth and dominance, which
Nehru famously referred as Modern Temples of Modern
India” . The new global consensus of liberalization policies
of varying degrees in various countries were characterized
with privatized state-owned enterprises, encouraging
new private enterprises, and lifting of many barriers to
foreign trade, direct foreign investment, and capital flows
from abroad.
1
2
To integrate with the world business regime, the
liberalization was ushered in 1991. And as competition
doors was opened to private industry & world, there
ushered in a change in the boundaries of the competition
ring, with new challenge coming in from the private sector.
As the market forces led the growth segment with the
Adam’s principal, the focus on the social perspective of
inclusive growth focus of public sector was marooned
by the need to increase profits from existence.
Literature Review
The first major work on the subject, Bowen’s Social
Responsibilities of the Businessman appeared in 1953.
It is considered by many to be the first definitive book
on the subject and marks the modern era of CSR (Valor,
2005). Bowen (1953: 6) defined CSR as businessmen’s
obligation, to pursue those policies, to make those
decisions or to follow those lines of action, which are
desirable in terms of the objectives, and values of society.
Because of his early seminal work, Carroll (1999) and
Windsor (2001) credited, Bowen with the title the “Father
of CSR”. McGuire (1963: 144) took the view that the
idea of social responsibility supposes that the corporation
has not only economic and legal obligations but also
certain responsibilities to society, which extend beyond
. Research Scholar, Department of Management, Sri Chandrasekharendra Saraswathi Viswa Mahavidyalaya, Kanchipuram.
. Research Scholar, Department of Management, Sri Chandrasekharendra Saraswathi Viswa Mahavidyalaya, Kanchipuram. I
Special Issue
November 2015
Page 15
these obligations. Davis (1960: 70) described CSR as,
businessmen’s decisions and actions taken for reasons
at least partly beyond the firm’s direct economic or
technical interest. The United Nations Industrial
Development Organization (UNIDO) has defined
corporate social responsibility (CSR) as “a management
concept whereby companies integrate social and
environmental concerns in their business operations and
interactions with their stakeholders. CSR is a way in
which companies achieve a balance of economic,
environmental and social imperatives.”
The concept of CSR is not new but CSR now, is a focal
point developed as part of stakeholders’ commitment to
the society around their firm’s existence. The focus of
such CSR was not constant it was dynamic to choose
areas which in turn promoted the business motives and
name in a sublime way garnering good vibes to the
organizations in the populace where they do business.
CSR has been described as an ambiguous (Fisher,
2004), vague (Williamson et al, 2006), subjective
(Frederick, 1986), unclear (McWilliams, 2001),
amorphous (Margolis and Walsh, 2001), fuzzy concept
(McGuire, 1963) with unclear boundaries and debatable
legitimacy (Lantos, 2001). Meeting corporate social
responsibilities not only allows organizations to display
high levels of moral or ethical conduct, but it is seen as
providing instrumental benefits and various types of
competitive advantage such as superior financial
performance, enhanced reputation, more motivated work
forces, the ability to attract desired employees etc.
There has been a significant increase in interest in CSR
in recent years (Basu and Palazzo, 2008; Angelidis et
al, 2008; Young and Thyil, 2009; Park and Lee, 2009;
Gulyas, 2009; McGehee et al, 2009) and is now at its
most prevalent (Renneboog et al, 2008; Turker, 2009a)
representing an important topic for research (Burton and
Goldsby, 2009). Recent corporate scandals have
attracted public attention and highlighted once more the
importance of CSR (Angelidis et al, 2008; Evans and
Davis, 2008). Not only has this topic received academic
attention (Burton and Goldsby, 2008) but it is becoming
a mainstream issue for many organizations (Renneboog
et al, 2008; Nijof and Brujin, 2008). It is now widely
recognized by business leaders that their companies
need to accept a broader responsibility than short-term
profits (Knox et al, 2005).
As time went by, CSR has been conceived as a tool
able to create a win-win situation for society and
organizations, creating good corporate reputation and
image and bringing in more business and profits
consequently (Campbell et al., 1999; Kanter, 1999;
KPMG, 2008; Yu, 2003). It was suggested that
partnerships can be established between organizations
Special Issue
and social sectors, creating opportunities (Swanson,
1995). Taking up CSR has become part of an
organization’s objectives and reflected in their strategies
(Campbell et al., 1999; Hanke and Stark, 2009; Holliday,
2002; Silberhorn and Warren, 2007).
India: From Charity To Philanthropy And Now CSR
Religion shapes the value system and motivates giving
in most societies. (Fosdick 1952, Chernow 1998). India
has a long tradition of charity that is rooted in the
theological concept of “Dana” or almsgiving and the
notion of almsgiving is associated with achieving salvation
through self-effacement. In India tradition of charity is
imbibed in the ethos of culture and religion from olden
days .The concepts and stories of charity are
interspersed in the historical epics, scriptures, and
stories of the India. Giving time, effort and wealth to
another human being stems from the imbibed cultural
roots of the country.
In India the public sector laid foundations of philanthropy
in a big way. They were the temples, which imbibed the
democratic principles of government, and the focus on
social development of all stakeholders was part of
unwritten cornerstone of public sector existence. Social
awareness programs were the earlier philanthropic
programs in the domain of the public sector, which
graduated now to be known as corporate social
responsibility programs.
But the CSR fame & rage was set more in the nineties.
Organizations’ main objective is known to be the profit,
but the recent scandals changed the focus on good
corporate governance practices, social responsibility, and
transparency. (Huse, 2005). Business ethical conduct
is a vital part of Corporate Social Responsibility (Carroll,
1991).
Corporate Social Responsibility (CSR) generally refers
to the social and environmental consciousness of the
firm, CSR has been identified as a macro-level activity
that has macro level consequences (Orlitzky, Schmidt,
& Rynes, 2003).
Any new company or entity that comes into existence
takes a toll in the society it exists in terms of
encashment of natural resources used and depleted and
also the impact of the processes on the environment.
Hence ethically it becomes a moral obligation of the
companies to contribute voluntarily to the society. And
CSR tools can be used by the organizations for direct
outreach to the society as social investment. With a
vibrant democratic basis, CSR is a very important tool
for promoting equitable democratic growth of business.
There is a growing realization towards contribution to
social activities globally with a desire to improve the
immediate environment (Shinde, 2005). It has also been
November 2015
Page 16
found that to a growing degree of companies that show
genuine attention to the principles of CSR behavior are
also favored by the public and preferred for their goods
and services.
The last decade of the twentieth century witnessed a
swing away from charity and traditional philanthropy
towards more direct engagement of business in
mainstream development and concern for disadvantaged
groups in the society. This has been driven both internally
by corporate will and externally by increased
governmental and public expectations (Mohan, 2001).
INDIA: CSR & Companies Act 2013
In order to enhance and ensure the participative function
of the industry in the growth saga of the country the
government in the unprecedented move has bought in
mandatory CCSR expenditure provision for the private
companies and Public sector companies through the
new Companies Act 2013
The most of the charity and philanthropy approach has
not taken up issues such as social Justice, equity and
human rights still largely remain untouched by the new
philanthropy. The challenge of the social justice
philanthropy has also to do with lack of active
government policies in the regard.
India made history with a path breaking amendment by
the new Companies Act 2013 in the field of CSR,
replacing its fifty-seven-year old Companies Act of 1956.
The Government of India made it mandatory for
companies to undertake CSR activities for bringing in
inclusive growth of the social stakeholders of company
and also to streamline the philanthropic activities with
more accountability and transparency. Clause 135 of
the act defines the CSR and it is applicable to
companies, which have an annual turnover of Rs 1,000
crores or more, or a net worth of Rs 500 crores or more,
or a net profit of Rs 5 crores or more.
The new clause of at least 2% of their average profit in
last three years has to be spend mandatory for CSR
activities. The wide spectrum of activities under CSR,
which can be taken by companies, cover activities such
as promotion of education, gender equity and women’s
empowerment, combating HIV/AIDS, malaria and other
diseases, eradication of extreme poverty, contribution
to the Prime Minister’s National Relief Fund and other
central funds, social business projects, reduction in child
mortality, improving maternal health, environmental
sustainability and employment enhancing vocational
skills among others.
In the new Act the companies can carry out these
activities by collaborating either with a NGO, or through
their own trusts and foundations or by pooling their
resources with another company. The law also entails
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setting up of a CSR committee, which shall be
responsible for decisions on CSR expenditure and type
of activities to be undertaken. This committee shall
consist of three or more directors, with at least one
independent director whose presence is expected to
ensure a certain amount of democracy and diversity in
the decision-making process. The CSR Clause will only
apply to some of the over 800,000 companies in India,
including over 8,000 publicly listed companies and
multinational companies. The accounting firm Ernst &
Young estimates that the law would cover over 2,500
companies in India and generate over U.S. $2 billion of
CSR spending in local communities. Prior to 2012-13,
many firms were voluntarily making donations and
spending on community development and mitigation of
environmental pollution. It is only since 2012-13 that
firms have started allocating funds for CSR activities
specifically.
Securities and Exchange Board of India (SEBI) circular
dated August 2012 mandated all top 100 listed
companies to include business responsibility report as
a part of their annual report. In the new Act the disclosure
of CSR Activities is made Compulsory.
Challenges of CSR Now
Corporate Social Responsibility (CSR) law has came
into effect on April 1, 2014. The Companies eligible under
section 135 of the Companies Act 2013 have embraced
the law and has initiated a number of CSR projects
across the entire spectrum as defined within schedule
VII of the Act. For companies which had been into CSR
before the law in force, the need was to streamline the
spending to fit requirements of the act. The Act propelled
the need to review and strategize the CSR spending
under a formal committee for the CSR working group.
The new CSR initiative also made emerge the need to
quantify impact of the CSR activities .This made the
companies put in place new strategies, approaches and
inclinations of various CSR activities that are in strong
alignment to the broader vision, policy and priorities of
the company. New strategies of the companies on CSR
focus is to owning up a cause and making it their CSR
identity with employee engagement.
But have the scaled up CSR initiatives helped in
development impact perceived by the bill with the benefits
to the new push in CSR cater to a wider population.
Also have companies choose to look out new areas of
CSR and pilot development activities and initiatives for
the collaborative effort of development that the
government expects from the new provisions of the Act.
Stakeholder expectations are constantly in change and
a company’s CSR communication must be evaluated
on a frequent basis (Morsing & Schultz, 2006:325).
November 2015
Page 17
With this rule the government has initiated a historic
step of fund diversion from the profits of corporate world
to areas where governmental agency reach is restricted.
Government also leveraged the chance to use
professional managerial skills of the corporate world to
identify and implement philanthropy in a more structured
and professional way. Managers must accept that
businesses are a societal construction and that
managers have an obligation to create benefits for
members of their society (Carroll, 1984, Gray et, at,
(1996). CSR broadens the relevant range of corporate
performance criteria beyond short-term profitability and
growth to include the long-term interests of multiple
stakeholders that are recognized as being critical to a
corporation’s success (Davis, et al., 1997, Donaldson,
et al., 1991). Harmonizing with international norms, fraud
reduction measures, new government powers, and
accountability provisions are all important new facets
expected of the Bill.
But the pertinent question that arise is that how would
companies align these government mandated CSR
activities to handle India’s socio-environmental
developmental challenges while also enabling better long
term profits for the business they are in. Can governmentmandated CSR be a social development path for a nation?
The challenges and concerns about the motives and
implementation of this new act based CSR activities
are eagerly awaited. Some of the concerns that arises
are listed as :
Can the new way become another way of siphoning of
public money from public sector companies by the
political establishment in power and can the philanthropy
be a new way of funding political aspirations under the
shade of CSR for benefits of mutual help.
How effectively can be the CSR funding be monitored
and is there a need for CSR audit of corporate activity
by external agency to check effectiveness of spending..
Can the social aims of the government be pursued by
the CSR choice to corporate, by which the choosing of
suitable area that pays non-economic dividend will be
chosen by the corporate.
And will the social change that govt. envisages by this
CSR activity really change the way philanthropy is
handled in the country and can conflict of interest ruled
out in area chosen by corporate for CSR.
The research design for this study involved a questionnaire
survey administered to a sample of executives and public
servants handling the functions of Corporate Governance
and CSR in Public Sector firms. For the research Public
Sector companies were selected were in the
manufacture of fertilizers, pesticides, refinery, rare earths
Special Issue
and the state PSU was involved in manufacture of fine
chemicals. All the public sector units were companies
having turnover more than 500 crores.
The research methodology consisted of review of
literature, based on which interview with selected Senior
Officials working in the related fields and departments
were done, which helped in preparation of a questionnaire
consisting of segments of CSR relationship to corporate
governance, effect of new Companies act 2013 and steps
to increase the effectiveness of CSR performance.
Objectives of the study is to establish the influence &
need of CSR in corporate performance contexts,
determine the effect of changes in CSR by the
implementation of the new Act, which in turn influences
Corporate & Social Governance performance parameters.
A set of hypothesis was formulated, intended to be
checked by the questionnaire analysis was as follows
Hypothesis Testing
A Hypothesis is an assumption about a population of
the study. Hypotheses are predictions that involve
variables and statistical data’s followed by tests. They
are tentative assumptions made in order to draw out
and reach conclusions based on hypothesis testing
(Research Methodology, C.R. Kothari). The various
hypothesis developed for this study is given below.
Hypothesis 1 (for Part A in questionnaire)
Null
: There is no significant relationship between
Corporate Governance & CSR.
Alternate : There is a significant relationship between
Corporate Governance & CSR.
Hypothesis 2 (for Part B & C in questionnaire)
Null
: CSR performance will not be enhanced by
Companies Act 2013.
Alternate : CSR performance will be enhanced by
Companies Act 2013.
Hypothesis 3 (for Part D in questionnaire)
Null
: Effectiveness of CSR performance cannot
be enhanced.
Alternate : Effectiveness of CSR performance can be
enhanced.
Data Analysis and Interpretation
The results of the empirical analysis are being discussed
in this section. By using SPSS, the statistical analysis
of this research was carried out. Data analysis comprised
of Reliability Tests, Test for Normality, Correlation
analysis and Paired samples T- Test.
Step 1: Reliability Analysis
By doing the Reliability of the variables an overall picture
of the study was obtained. From the reliability analysis
November 2015
Page 18
Cronbach’s Alpha obtained is .989 and indicates best
accuracy of the measuring instrument.
Reliability test was done for the response of each
question, which is, enclosed as annexure I. Obtained
value is greater than 0.9. Hence excellent
N of Items
.989
31
Overall Effectiveness of CSR
10
Frequency
8
6
4
2
0
50
75
100
125
150
Fig. 1
Mean = 119.95
Std. Dev. = 20.323
N = 60
Once the Reliability analysis is over, the next stage is
to check whether this study follows a Normal Distribution
or not. Histograms and P-P plots are used for the test.
Step 3: Correlations
Correlation is a term that refers to the strength of a
relationship between two variables. It is used to show
whether and how strongly pairs of variables are related.
The main result of correlation is called a correlation
coefficient “r”. The closer the value of r towards +1, the
more closely two variables is related.
Normal p-p Plot of overall Effectiveness of CSR
Expected Cum prob
1.0
0.8
0.6
0.4
0.2
0.0
0.0
0.2
0.4
0.6
0.8
Observed Cum Prob
Fig. 2
Special Issue
Results
Strong positive correlations are obtained in our study,
which shows that the selected variables are highly
relevant (i.e. there exists a strong relationship between
Corporate Governance and CSR)
Step 4: T-Test
A paired t – test is used to determine whether there is a
significant difference between the average values of the
same measurement made fewer than two different
conditions. Both measurements are made on each unit
in a sample, and the test is based on the paired
differences between these two values. The usual null
hypothesis is that the difference in the mean values is
zero. For all the factors the p value is < .05. There
exists a significant difference between the groups for
the factors taken. The table shown below clarifies the
study results. The paired t-test conducted, the p value
obtained is less than 0.01. Hence the null hypothesis is
rejected and alternate hypothesis is accepted in all the
three cases.
Reliability Statistics
Cronbach’s Alpha
1.0
Hypothesis-1
Result
Null: There is no significant relationship
between Corporate Governance & CSR
Alternate:
There is significant relationship
between Corporate Governance & CSR
There is a significant relationship between Corporate
Governance & CSR as t value is positive and p value is
less than 0.01
Hypothesis-II
Result
Null: CSR performance will not be enhanced
by Companies Act 2013
Alternate: CSR performance will be enhanced by
Companies Act 2013
CSR performance will be enhanced. There exists a
significant positive relationship such that Companies Act
2013 will enhance CSR performance.
Hypothesis-III
Result
Null: Effectiveness of CSR performance cannot be
enhanced through the steps adopted
Alternate: Effectiveness of CSR performance can be
enhanced through the steps adopted.
Effectiveness of CSR performance can be enhanced.
There is a significant relationship between the steps
adopted and the CSR effectiveness and the effect is
positive.
November 2015
Page 19
Conclusion
Traditionally, development has been the responsibility
of the government, but since public delivery of goods
and services has been riddled with corruption and
bureaucratic inefficiency and the welfare schemes is
plugged with leakages.
The law is very significant, because India is at the
threshold of demographic dividend, and there is an urgent
need for the creation of human and physical capital to
reap its rewards. Investment in education, health, skill
development and social infrastructure will enhance
capabilities of the youth by improving their nutritional,
skill and educational level, which in turn will better their
employment prospects. CSR is being seen as an
alternative to governmental provision of merit goods. CSR
will increase availability of funds for welfare activities and
may lead to delivery of goods and services to the people
in a cost-effective manner. The clause on CSR is a step
towards achieving social and environmental
sustainability, which will benefit society in future.
The new provisions of the companies act is definitely
going to better the CSR growth in the country but
channelizing of the CSR funds in an constructive way
and equitable development all over the country needs to
be ensured. The study highlights the needs for
innovations and enterprises in CSR initiative of Indian
companies for sustainable inclusive growth. Some
limitations might constrain the generalizability of the
interpretations and findings of the study; however the
results of the current study are somewhat consistent
with the proposal of challenges to CSR. Organizations
should also clearly emphasize the importance of those
challenges while managing their CSR practices in this
regard to capitalize on its human capital potential leading
to better organizational outcomes. The new CSR activity
if not watched would lead to ‘tick box’ behavior, tokenism
or even corruption, forced philanthropy, and masking of
data to avoid having to comply regulations. In order to
have the transparency in doing business, the companies
should involve their CSR activities spending in the annual
reports besides the other sections along with the
effectiveness and benefits given to the stakeholders after
a third party audit. What kind of monitoring there’ll be in
terms of how well this money is used only time will show
if this legislation will have a real impact on poor people’s
lives and prevent actual environmental degradation.
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Solomon, J., (2007), corporate governance and
accountability, 2nd edition, John Wiley and son’s ltd,
Wiltshire.
Ungureanu Mihaela, Models and Practices of
Corporate Governance Worldwide, Volume:4, Issue:
3a, 2012, p.625 (pp.625-635)
World Bank Report (2005), India: Role of Institutional
Investors in the Corporate Governance of their
Portfolio Companies.
November 2015
Page 21
A STUDY ON EMPLOYEE ENGAGEMENT AMONG IT SECTOR
EMPLOYEES IN KERALA
C V Lolitha1
Dr. Johney Johnson2
Abstract
Employee engagement has been an area of interest among many researchers and it had received a greater recognition
among consulting firms. Employee engagement is the state in which employees feel passionate about their jobs, are
committed to the organization, and put discretionary effort into their work. It has been observed that modern
organizations are emphasizing a lot on practicing employee engagement looking at the benefits earned by having
‘high engaged employees’ in their organizations. It is therefore, important to identify the low engaged employees and
replace them with high engaged employees in order to develop the employees and organization as a whole. This
article presents an assessment on the level of employee engagement among IT sector employees in Kerala. This
study helps to understand the various concepts of employee engagement as it reinforces previous literature on the
construct of engagement followed by analysis, discussion and conclusion.
Key words: Employee Engagement, Commitment, Job Engagement and Organizational Engagement
Introduction
IT industry has always been facing the challenge of
extremely high employee turnover. Companies take a
deep interest in their employee turnover rate because it
is a costly part of doing business. High employee
turnovers imply low employee commitment towards the
organization. This study is an attempt made to examine
the relationship of employee engagement with organizational
commitment of IT (Information &technology) sector
employees in select organizations in Kerala.
For identifying the general antecedents of employee
engagement, literatures as well as models developed
by consulting organizations were reviewed. Since the
employee engagement construct is still relative recent,
both literature and consulting models are examined so
as to gain insights and obtain contributions from practice,
in addition to the academic data.
• To ascertain the extent to which employee
engagement (both job and organizational) relates to
organizational commitment among select IT
companies in Kerala.
• To determine the level of employee engagement by
demographic variables (age, gender, work experience
and educational qualification).
Literature Review
Employee engagement has become the new buzzword
and obsession of HR departments. Yet, the term
“engagement” has been used quite inconsistently by the
1
2
various research institutes, consulting companies, and
their clients. It has been used in reference to a variety of
employee attitudes, for example employee satisfaction,
trust, motivation, willingness to work, Organizational
commitment etc. One of the problems with the construct
is that many of the definitions of employee engagement
invoke existing constructs, such as job satisfaction,
organizational commitment, organizational citizenship
behaviors and job involvement, but they do not
demonstrate the relationship of employee engagement
to those other constructs.
According to Kahn (1990) a dynamic, dialectical
relationship exists between the person who drives personal
energies (physical, cognitive and emotional) into his or
her work role on the one hand, and the work role that allows
this person to express him or herself on the other hand.
Schaufeli et al. (2002) define engagement as a positive,
fulfilling, work-related state of mind that is characterized
by vigor, dedication, and absorption. Rather than a
momentary and specific state, engagement refers to a
more persistent and pervasive affective-cognitive state
that is not focused on any particular object, event,
individual or behavior.
Robinson et al. (2004) consider work engagement as a
positive attitude held by the employee towards the
organization and its values. They opine that an engaged
employee is aware of the business context, works with
colleagues to improve performance within the job for the
benefit of the organization. Engagement is a two-way
relationship between employer and employee. It overlaps
with commitment and organizational citizenship behavior,
. Research Scholar, School of Management and Business Studies Mahatma Gandhi University, Kottayam, Kerala.
. Assistant Professor, School of Management and Business Studies, Mahatma Gandhi University, Kottayam, Kerala
Special Issue
November 2015
Page 22
but it is two-way relationship and is “one step up” from
commitment.
Social Exchange Theory (SET) provides a stronger
theoretical rationale which can be used to support
Kahn’s views on engagement. The foundation of SET is
that these relationships develop over time leading to
trust, loyalty, and mutual commitment. In order to achieve
this desirable stage, both parties must follow specific
‘rules of exchange’. These ‘rules of exchange’ involve
reciprocity in such a way that the actions of one side
create a response or repayment actions by the other
side. The level of engagement will vary based on the
resources they receive from their organizations. Saks
concludes that resources – economic, social and
emotional – provided by the organization will dictate the
quantum of physical, cognitive and emotional energy an
individual will bring to his work.
The data for this study was collected from employees of
IT sector companies in Kerala.Research participants
(N=60) was selected based on a convenient sampling
process. Data was collected through online
questionnaire from 60 employees each from IT sector
organisations in Kerala irrespective of their current
position .The study analysed the 60 responses out of
75 responses collected, which were useful and complete
and the rest 15 unfilled were left out .A three section
online questionnaire was used for data collection. The
first section of the questionnaire consisted of 5 items
inquiring about demographic characteristics of
respondents such as employees’ gender, age,
educational qualification, and work experience. The
second section consisted of questions related to
measure employee engagement (job and organizational).
The third section consisted of questions related to
measure organizational commitment.
Measures
Both job engagement and organization engagement was
measured by two six-item scales used by Saks (2006).
Items were written to assess participant’s psychological
presence in their job and organization. A sample item
for job engagement is, I really “throw” myself into my
job” and for organization engagement”. Being a member
of this organization is very captivating”. The scale
demonstrated an internal consistency (alpha) reliability
of .713 for organizational engagement and .696 for job
engagement in the current study. Organizational
commitment of the respondents was measured using
the six-item affective commitment scale by Rhoades et
al (2001).A sample item for commitment in this study
is, “I feel a strong sense of belonging to my organization”.
The cronbach’s alpha value for organizational commitment
scale was .884, which is highly reliable. Participants
indicated their response on a five-point Likert -type scale
with anchors (1) strongly disagree to (5) strongly agree.
Hypotheses
H1 : Organizational engagement is positively related to
organizational commitment among employees in
IT companies.
H2 : Job engagement will be positively related to
organizational commitment among employees in
IT companies
H3 : Job engagement will be positively related to
organizational engagement among employees in
IT companies
H4 : There will be a significant positive relationship
between demographic variables of the respondents
and employee engagement among employees in
IT companies
Hypotheses Testing
The hypothesis sought to investigate the extent to which
job and organizational engagement is related with
organizational commitment. The hypothesis was
investigated using Pearson correlation coefficient.
Summary of the results are presented in Table - 1 below
TABLE - 1: Correlations
ORGCOMMITMENT
ORGCOMMITMENT
ORGENGAGEMENT
Pearson Correlation
1
Sig. (2-tailed)
N
ORGENGAGEMENT
Pearson Correlation
Sig. (2-tailed)
.550**
-.158
.000
.228
60
60
60
.550**
1
.268*
.000
N
JOBENGAGEMENT
JOBENGAGEMENT
Pearson Correlation
Sig. (2-tailed)
N
.039
60
60
60
-.158
.268*
1
.228
.039
60
60
60
**. Correlation is significant at the 0.01 level (2-tailed).
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November 2015
Page 23
InterpretationFrom Table 2 above, in case of employees from IT sector, there is highly positive significant relationship
between organisational engagement and organisational commitment [r=.550**, p<0.05]. Hence we accept H1. There
is no significant relationship between job engagement and organisational commitment [r=-.158, p isnot less than
.05].].Hence we reject H2 .There is a significant positive correlation between job and organization
engagements[r=.268*, p<0.05]. Hence we accept H3.
TABLE - 2 : Influence Of Age On Employee Engagement
ANOVA EMPLOYEE ENGAGEMENT
Comparison
Sum of Squares
Between Groups
Df
Mean Square
4.519
4
1.130
Within Groups
32.004
127
.252
Total
36.523
131
F
4.483
Sig.
.002
Source: Primary Data
TABLE - 3 : Influence of Work Experience on Employee Engagement
ANOVA EMPLOYEE ENGAGEMENT
Comparison
Sum of Squares
Between Groups
Df
Mean Square
.879
3
.293
Within Groups
35.644
128
.278
Total
36.523
131
F
1.052
Sig.
.372
Table - 4 : Influence of Educational Qualification on Employee Engagement
ANOVA Employee Engagement
Comparison
Between Groups
Sum of Squares
Df
Mean Square
3.165
3
1.055
Within Groups
33.358
128
.261
Total
36.523
131
F
4.048
Sig.
.009
Interpretation
The one-way ANOVA was carried to find out if there is any influence on employee engagement by age, work
experience and educational qualifications of the respondents and it is shown in Table 2, Table 3and Table 4 respectively.
From the tables mentioned above, it can be known that the demographic characteristics of the employees such as
age (since p=.002, p<0.05) and educational qualification (since p=.009, p<0.05) has significant influence on the
level of employee engagement among IT sector employees. But it was known that work experience has no influence
on the level of employee engagement among employees in IT companies.
Discussion
The study adopted a survey method to study employee engagement and organizational commitment. The data
analysis was done using SPSS 21version. The responses to this study were made up 88% of respondents comprising
of the senior management, middle management and juniors. 60.6% of the respondents were male with 39.39% the
respondents being female. The hypothesis that there will be a positive significant relationship between employee
engagement (job and organization) and organizational commitment was supported by the analysis shown in Table
1. Pearson correlation coefficient was used to analysis the correlation between the study variables such as
organizational commitment, job engagement and organizational engagement. This finding implies that employees
who are given the necessary resources by their organizations to perform their tasks effectively tend to respond
favorably to the organizations they are committed to. This finding is consistent with results from a study conducted
by Saks (2006) when he established that engagement of employees mediated the relationships between the
antecedents and job satisfaction, organizational commitment, intentions to quit the job, and organizational citizenship
behavior. From the analysis it was known that majority of the employees are properly engaged in their work and
Special Issue
November 2015
Page 24
moderately committed. The findings of the study revealed
a significant positive relationship between employee
engagement and organizational commitment.
The One-way ANOVA analysis is used to determine there
exists any significant and insignificant difference among
the means of two or more independent groups. Table2,
Table 3and Table 4shows one – way ANOVA and shows
analysis results of variance of demographic variables with
employee engagement. Results described that all
demographic variables do show significant variation with
employee engagement. Age and educational qualification
of the respondents show significant influence on the level
of employee engagement but work experience have no
influence for their level of engagement towards either their
job or their organization.
Limitations
The research was limited to IT sector employees in Kerala
only. The employees of this dynamic industry are
ambitious and look out for better opportunities always.
For future consideration this study can be extended to
larger sample in order to identify other factors which affect
performance of IT employees and if data is also collected
from the other sector. In this regard, replicating this study
in different settings would be worthwhile to establish the
validity and generalizing of the present findings across
different contexts
Conclusion
We can conclude that the importance of employee
engagement in the organizational setting is undeniable.
Prudent practices of engaging employees should be
implemented in the organizations in order to enhance
their commitment to the organization. Employees are
the assets of any organization and organizations should
adopt impeccable measures to engage their key
performers to build a committed work force.
Special Issue
References
• Bakker, A.B., and Demerouti, E. (2008), “Towards a
model of work engagement”, Career Development
International, Vol. 13 (3), pp. 209-223.
• Corporate Executive Board. (2004), “Driving
performance and retention through employee
engagement”,
retrieved
from
www.corporateleadershipcouncil.com
• Fleming, J. H., Coffman, C., & Harter, J. K. (2005),
“Manage your human sigma”, Harvard Business
Review, Vol. 83, pp. 106–115.
• Gupta, K. (2008), “A Study of Employee Engagement
with Regard to Banking”, The Journal of Management
Research, Vol. 17, No. 8, pp 7-26.
• Kahn, W. A. (1990), “Psychological Conditions of
Personal Engagement and Disengagement at Work”,
Academy of Management Journal, Vol. 33, pp-692724.
• Robinson, D., Perryman, S., &Hayday, S. (2004),
“Job Engagement: Antecedents and Effects on Job
performance”, Academy of Managerial Journal, Vol.
53, No.3, pp- 617-635.
• Saks, A. M. (2006). “Antecedents and consequences
of employee engagement”, Journal of Managerial
Psychology, 21(7), pp. 600-619.
• Schaufeli, W.B., Salanova, M., Gonza´lez-Roma´, V.
and Bakker, A.B. (2002), “The measurement of
engagement and burnout: A two sample confirmatory
factor analytic approach”, Journal of Happiness
Studies, Vol. 3, pp. 71 - 92.
November 2015
Page 25
A COMPARATIVE ANALYSIS OF CORPORATE SOCIAL RESPONSIBILITY
REPORTING OF PUBLIC AND
PRIVATE SECTOR BANKS IN INDIA
Clement Cabral1
Abstract
This paper is a comparative analysis of public and private sector bank in India i.e. State Bank of India and ICICI bank
on the basis of quality of the Corporate Social Responsibility report as per sustainability reporting indicators given by
Global Reporting Initiatives. Data of two financial years i.e. 2012-13 and 2013-14 have been collected from publicly
available information through company websites, annual reports, Business Responsibility report, third-party websites
and other nonfinancial information disclosure used to gather base information for the study. Qualitative analysis has
been conducted by using seven key quality aspect with the appropriate scoring weightage criteria assigned to each
of the quality aspects. Results of this study show that the quality of CSR reporting of public and private banks are
average. The quality can be improved by addition of certain indicators. Main limitation of this study is that it is based
only on secondary data and sample size i.e. two banks, is small. This study can be conducted on larger sample size.
Key words: Business Responsibility Report, Corporate Social Responsibility, Global Reporting Initiatives
Introduction
Corporate social responsibility reporting plays a vital role
in performance of an organization. In order to sustain
the long run the corporate are required to perform socially
and economically. CSR reporting enables to improve
organization’s value, governance, its commitment
towards various stakeholders. In India, regulatory
developments over the past three years have set the
momentum for higher CR reporting rates.
Release of National Voluntary Guidelines on Social,
Environmental and Economic Responsibilities of
Business (NVG-SEE) by the Ministry of Corporate
Affairs, India in 2011 was a key development to gain the
attention of the larger industry audience on the need for
adoption of CSR practices by businesses and for
transparent CSR disclosure. This voluntary guidance
was progressively adopted by Securities Exchange Board
of India (SEBI) in 2012 to mandate compulsory disclosure
of adoption of NVG-SEE for the financial year ending on
or after 31 December, 2012. The mandate, through
Clause 55 of the listing agreement with stock exchanges
in India, makes Business Responsibility Reporting
compulsory for top 100 listed entities (by market
capitalization). Similarly, the Department of Public
Enterprise (DPE) has issued Guidelines on Corporate
Social Responsibility and Sustainability for Central
Public Sector Enterprises which sets the requirements
for CR reporting to assess the overall performance of
Central Public Sector Enterprises. The other key
1
development that will impact CR disclosure is the new
Companies Act of India, 2013. The landmark legislation
includes Corporate Social Responsibility (CSR) as a
mandatory agenda item at the Board level and requires
companies to report on their CSR policy, governance
and initiatives along with CSR budget spent. The
legislation advocates 2 per cent of net profits as a
prescribed allocation for CSR expenditure. At the same
time, markets have also responded with positive
developments such as the launch of S&P BSE Greenex
and Carbonex market indices which separately track
companies with better CR performance and disclosure
frameworks. These domestic developments coupled with
international developments like the release of GRI G4
Guidelines is expected to significantly alter the CR
reporting scenario. Many individuals today are basing
their corporate loyalties on how companies are positively
impacting their community. A corporation’s public image
is at the mercy of its social responsibility programmers
and how aware communities are of them. Despite being
a vital issue, there is scarce information to understand
about CSR in India. The need for business transparency
and accountability has strongly felt by stakeholders and
shaped increasing demand for responsible corporate
behavior and transparent corporate reporting. The
purpose of this study is to study how effectively CSR
Reporting is being practiced by public and private sector
banks in India i.e. SBI and ICICI bank respectively. This
study helps to understand more about the present state
of CSR disclosure in public and private banks in India.
. Lecturer, Department of Commerce, The Cochin College, Kochi, Ernakulam, Kerala.
Special Issue
November 2015
Page 26
State Bank of India
State Bank of India (SBI) is the nation’s largest and oldest
bank with a network of 15869 branches. The Bank’s three
major products/services categories, each of which
individually comprises of several products/services, are:
Deposits, Loans and Advances and Remittances and
Collections. Corporate Social Responsibility is integral
part of the State Bank of India covering various social,
environmental and welfare activities. This is rooted in
the Bank’s belief that it owes a solemn duty to the less
fortunate and underprivileged members of the society to
make a sustainable social change in their development.
In fact since 1973 the Bank is actively involved in nonprofit
activity called Community Services Banking. All its
branches and administrative offices throughout the
country sponsor and participate in large number of
welfare activities and social causes. The budget for the
Bank’s Corporate Social Responsibility (CSR) spending
for FY 13-14 was 1% of the previous year’s PAT which
amounts to INR 141 crores. The Bank’s actual spend
on CSR activities for FY 13-14 was INR 148.93 crores.
The Bank’s CSR activities touch the lives of millions of
the poor and needy across the length and breadth of the
nation. While CSR is embedded in many of the Bank’s
business initiatives it covers various social, environmental
and welfare activities. The Bank has a comprehensive
Corporate Social Responsibility (CSR) Policy, approved
by the Executive Committee of the Central Board in
August 2011.
The focus areas of the Bank’s CSR activities are listed
here under:
• Supporting education.
• Supporting healthcare.
• Assistance to poor & underprivileged.
• Environment protection.
• Entrepreneur development program.
• Help in National calamities.
ICICI Bank Limited
ICICI Bank Limited incorporated in Vadodara, India is a
publicly held banking company engaged in providing a
wide range of banking and financial services including
retail banking, corporate banking and treasury
operations. As of 2014, it is the second largest bank in
India in terms of assets and market capitalization. The
Bank has approximately spent 2.0% of its average profit
after tax for the three financial years ending March 31,
2012, March 31, 2013 and March 31, 2014, on donations
& grants primarily to the ICICI Foundation for Inclusive
Growth (ICICI Foundation), and on the Bank’s financial
inclusion initiatives. The above expenditure has been
undertaken by the Bank, directly and through ICICI
Foundation, primarily on
Special Issue
•
•
•
•
Elementary education
Skill development & sustainable livelihoods
Primary healthcare
Financial inclusion
• To study about Corporate Social Responsibility
Reporting
• To analyze the quality of Corporate Social
Responsibility Reporting of public and private sector
banks in India.
Data collection -To accomplish the above stated
objectives of the study, secondary data of the two
financial year’s i.e. 2012-13 and 2013-14 have been
taken into consideration. This data has been collected
mainly from
• Company websites
•
Annual reports
•
Business Responsibility report
•
Third-party websites
•
Other nonfinancial information disclosure
The Sample - For the purpose of study, the largest
public sector bank in India, State Bank of India is selected
and largest private sector bank in India, ICICI Bank is
selected. These banks mandate through Clause 55 of
the listing agreement with stock exchanges in India
makes Business Responsibility Reporting compulsory.
Statistical Tools Used - Percentage is used for
analysis. A checklist is prepared to study the Corporate
Social performance on the basis of social performance
indicators given by GRI G3 guidelines.
Reliability of data - Data is collected from annual and
sustainability reports which are authentic and reliable
source of collecting secondary data as these reports
are audited externally.
Results and Discussions - Qualitative analysis was
conducted by using seven key quality aspect (maximum
score of 100) with the appropriate scoring weight age
criteria assigned to each of the quality aspects. The
seven key quality aspects were considered from Global
Reporting Initiatives G3 Sustainability Reporting
Guidelines. For detailed study these seven key quality
aspects were again divided into twenty five sub criteria
as mentioned. In order to quantify the data four points
(25/100) each was assigned to sub criteria. If sub criteria
is present in the BR report, four points is assigned and
absence attracts zero points. Two points is assigned if
the bank satisfies half of the criteria. The aggregate point
obtained by both banks are computed and scaled. If the
aggregate point falls between 0-20, 20-40, 40-60, 60-80
and 80-100 corresponds to very poor quality, poor quality,
average, good quality and very good quality respectively.
November 2015
Page 27
Findings
Strategy, risk and opportunity
Businesses today operate in an increasingly resource constraint world and are exposed to an array of sustainability
mega forces which will impact the way businesses will operate in the long term. These mega forces are complexly
interconnected with the potential to amplify the impacts multi-fold. Mega forces include deforestation, climatic
changes, energy and fuel, material resource scarcity, water scarcity, population growth, wealth, urbanization, food
security and eco system decline.
Table - 1
Qualitative aspects
1.Strategy, risk and
opportunity
Sub criteria
State Bank of India
ICICI Bank
1.1 Awareness on social and environmental mega forces
and their impact on the business
4
4
1.2 Understand and, ideally, quantify the resulting risks
and opportunities
2
2
1.3 Strategy in place to minimize risk and exploit
opportunities and is clear about the actions taken
4
4
Total
10
10
With ever expanding global complex supply chains and diverse customers’ base, companies will have to demonstrate
the understanding of a full range of impacts of these sustainability mega forces and articulate appropriate strategies
to minimize risks and maximize opportunities that these mega forces present as well as in the future.
Yes, SBI and ICICI bank are aware on social and environmental mega forces and their impact on the business.
Among the mega forces, SBI gave more importance to environmental mega forces such as energy and fuel, climatic
changes, deforestation, ecosystem decline and material resource scarcity. But, there is no mention about water
scarcity. SBI states social mega forces such as food security and urbanization.
CICI bank gave more importance only to environmental mega forces such as climatic change, energy and fuel,
material resource scarcity, water scarcity and ecosystem decline. The Bank through its Technology Finance Group
assists projects that promote clean technology, preserve biodiversity and protect the environment. ICICI Foundation
focuses on social initiatives such as elementary education, sustainable livelihoods, primary healthcare and financial
inclusion.
Yes, SBI and ICICI bank understand about the risks and opportunities, and but, fails to quantify the resulting risks
and opportunities. Both banks has understanding about several opportunities such as innovation, cost savings,
improving market position, improving reputation, improving employee motivation etc. However banks fail to quantify
these risks and opportunities.
Yes, there are strategies in place to minimize risk and exploit opportunities and is clear about the actions taken.
SBI introduces sustainable products and services such as SBIePay for e-commerce, State Bank MobiCash Easy
– a mobile wallet, Green Channel Self Service Kiosk, Green Remit Card, prepaid cards like Smart Payout card, Ez
Pay Card, VishwaYatra Card etc. are some of the initiatives of the Bank’s green initiatives and have social benefits
also.
ICICI bank provides sustainable banking products to cater to different classes of customers through an expansive
ATM network, mobile, phone, internet, doorstep banking. Customized products include personal loans, home loans,
loans for asset purchases and a wide range of accounts and deposits. The Bank also offers a selection of cards for
convenience to complement the distinct lifestyle needs of customers. In addition, the Bank’s Rural & Inclusive
Banking Group focuses on rural and below poverty line customers.
2. Materiality
Materiality means the information in a report should cover topics and Indicators that reflect the organization’s
significant economic, environmental, and social impacts or that would substantively influence the assessments
and decisions of stakeholders.
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November 2015
Page 28
Table - 2
Qualitative aspects
2.Materiality
Sub criteria
State Bank of India
ICICI Bank
2.1 Clear identification and disclosure of all material
issues
4
4
2.2 Regular materiality assessment which is an ongoing
process to assess the changing significance of issues
to the business and its stakeholders
0
0
2.3 Consideration of internal and external stakeholders’
inputs for assessing materiality
0
0
2.4 Management approach for material issues to improve
performance over a period of time.
4
4
Total
8
8
Yes, Business Responsibility Report of SBI has clear identification and disclosure of all material issues. SBI, under
community service banking, various welfare and social activities are undertaken by the Bank both in Banking and
Non-Banking areas to raise the quality of life of the downtrodden and under-privileged sections of society Environmental
factors are achieved by launching sustainable products and services, environmental friendly initiatives etc.
ICICI bank has clear identification and disclosure of all material issues. The Bank through its Technology Finance
Group (TFG) involved in social initiatives such as soft loan/grant assistance to entities engaged in a number of
activities that benefit the under-privileged, including medical research & facilities and vocational training & rehabilitation
of physically challenged persons (including defense personnel who have suffered injuries as a result of which they
are unable to continue in the defense forces). The environmental initiatives undertaken through Technology Finance
Group (TFG) includes soft loan/equity/grant assistance for development & distribution of fuel efficient cook stoves &
solar lanterns, seed-stage sustainable energy and clean technology development and wildlife & forest conservation.
There is no regular materiality assessment in SBI and ICICI bank, which can be considered as an ongoing process
to assess the changing significance of issues to the business and its stakeholders
Both banks have no consideration of internal and external stakeholders’ inputs for assessing materiality
The banks have management approach for material issues to improve performance. SBI has laid down a welldefined Code of Conduct for its Directors on the Central Boarded and ICICI through the Group Code of Business
Conduct & Ethics. This Code of Conduct attempts to set forth the guiding principles on which the Bank operates
and conducts its daily business to improve performance.
Targets and indicators
Well defined targets and key performance indicators (KPIs) are important for companies to achieve continual
improvement and to drive innovation. Targets have to be linked to material CSR issues. Clear baselines need to be
established along with timelines to monitor progress and achievement. Targets have to be supported by defined
KPIs to measure and manage the achievements.
Table - 3
Qualitative aspects
3. Targets and
indicators
Sub criteria
State Bank of India
ICICI Bank
3.1 Identify CR performance targets that are time-bound
with a clear baseline and timeline
4
4
3.2 Assign targets to relevant material CR issues
0
0
3.3 Define KPIs for targets to measure progress against
targets
0
0
3.4 Disclose performance against CR targets.
0
0
Total
4
4
The budget for the SBI Corporate Social Responsibility (CSR) spending for FY 13-14 was 1% of the previous year’s
PAT which amounts to INR 141 crores. The Banks actual spend on CSR activities for FY 13-14 was INR 148.93
Special Issue
November 2015
Page 29
crores. ICICI has approximately spent 2.0% of its average profit after tax for the three financial years ending March
31, 2012, March 31, 2013 and March 31, 2014.
No data to specify targets to relevant material CR issues.
KPIs for targets to measure progress against targets are absent in the BR report of both banks
Banks fail to disclose performance against CR targets.
Supply Chain
Corporate social responsibility issues beyond their own operations have a far greater impact on businesses and
thus it is imperative for companies to identify such CSR issues across the value chain – environmental and social
issues of supply chain; environmental and social concerns related to products and services. There is also growing
stakeholder pressure on companies to acknowledge and address especially supply chain CR issues. Owing to the
nature of complex supply chains and limited influence on customer choices, it is rather difficult to measure and
mitigate value chain CR issues. This requires concerted efforts by companies to have constant dialogue and partnership
with suppliers and also innovate for sustainable products and services.
Table - 4
Qualitative aspects
4.Suppliers and
Value Chain
Sub criteria
State Bank of India
ICICI Bank
4.1 Formal CR requirements for supply chain and
development of mechanisms to improve supplier
performance (such as a supplier code of conduct and
CR criteria for supplier selection)
0
0
4.2 Involvement with suppliers to help them address their
CR impacts
4
4
4.3 Audit suppliers against code of conduct
0
0
4.4 Set targets for reducing the impact of supply chain and
measure the progress against these targets
0
0
4.5 Identification of social and environmental impacts
associated with the use and disposal of products and
services.
0
0
Total
4
4
Both banks has no formal CR requirements for supply chain and development of mechanisms to improve supplier
performance
Yes, SBI and ICICI bank has involvement with suppliers to help them address their CR impacts
No, banks do not audit suppliers against code of conduct
4.4 No, SBI has no targets for reducing the impact of supply chain and measure the progress against these
targets
4.5 State Bank of India has no identification of social and environmental impacts associated with the use and
disposal of products and services
State Bank of India and ICICI bank’s banking operations do not have a complex supply chain and thus the business
partners i.e.Suppliers and distributors are also quite limited, which leaves very little scope for the engage them in its
Business responsibility initiatives. The bank expects and encourages its supply chain to conduct their business in
a responsible manner.
5. Stakeholder engagement
The stakeholder engagement means identifying its stakeholders and explains in the report how it has responded
to their reasonable expectations and interests. Stakeholder engagement processes can serve as tools for
understanding the reasonable expectations and interests of stakeholders. Organizations typically initiate different
types of stakeholder engagement as part of their regular activities, which can provide useful inputs for decisions
on reporting.
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November 2015
Page 30
Table - 5
Qualitative aspects
5.Stakeholder
engagement
Sub criteria
State Bank of India
ICICI Bank
5.1 A process in place to identify and engage key
stakeholders
4
4
5.2 Response to stakeholder feedback and action taken
where necessary
4
4
5.3 Process to seek and gather stakeholder views on CR
reporting and performance and report these transparently
0
0
Total
8
8
5.1Yes, the SBI has process in place to identify and engage key stakeholders. The Bank’s approach to stakeholder
engagement helps to minimize risks, identify ideas for new products and Services, and understand and respond
to the issues that matter to the communities it serves. The Bank communicates with the stakeholders through a
variety of channels, such as e-mails, website, conference call, Press Meets, Advertising, one-on-one meeting, analysts’
meet and attendance at Investor Conference throughout the world. Stakeholder engagement is embedded in all
areas of the Bank. The Bank seeks feedback through all their customer-facing channels, listens to all shareholders
concerns and provides opportunities for employees to provide feedback. The engagement with stakeholders is through
social media like Face book & twitter, and active participation in a variety of industry and community associations.
ICICI bank through its various financial inclusion initiatives are expanding its outreach to rural and semi-urban
markets and providing financial solutions to customers in this market. The banking and the financial services being
provided by the Bank to the unbanked and below poverty line customers is providing an opportunity to the target
customers to improve their livelihoods. ICICI Foundation encourages the active engagement of key stakeholders
such as the Governments, NGOs, Panchayati Raj Institutions (PRIs), communities and other local institutions in
the project planning and implementation to facilitate developing and building community ownership while ensuring
the sustainability of the programmes
Yes, State Bank of India has response to stakeholder feedback and action taken where necessary. The Bank’s
vision statement clearly spells out the centricity of the customer in the Bank’s business strategies and operations.
A multi-tiered structure of committees constantly review existing services and suggest improvements. Important
issues raised by these Committees and action taken thereon, as well as analysis of the consolidated data for
customer grievances for all Circles are placed before the Customer Service Committee of the Board every quarter,
to identify common systemic and policy issues that require rectification.
ICICI bank has response to stakeholder feedback and action taken where necessary. But elaborate details are not
mentioned in the BR report.
No, The Banks have no process to seek and gather stakeholder views on CR reporting and performance and report
these transparently.
Governance of CSR
CSR governance structure at the apex levels with clearly defined roles and responsibilities demonstrates the
commitment of an organization to integrate CR across levels and functions. Board level oversight on CR will enable
the Board to understand broader CR trends that affect long term sustainability of the company and provide strategic
guidance to address them.
Table - 6
Qualitative aspects
6.Governancefor
CSR
Special Issue
Sub criteria
State Bank of India
ICICI Bank
6.1 A primary person and/or function is assigned with the
ultimate responsibility for CR at the highest levels of the
organization
4
4
6.2 An individual/function is appointed to manage
sustainability on a day-to-day basis and report to the
company Board
4
4
6.3 Linkage of CR performance to remuneration exists.
0
0
Total
8
8
November 2015
Page 31
6.1 Yes, SBI and ICICI have a primary person and/or function is assigned with the ultimate responsibility for CSR
at the highest levels of the organization. The Business Responsibility Policy is circulated across all Departments
/ Business Groups / Verticals of the Bank. Further, it is communicated to all employees through induction
programs, orientation sessions and internal portals. The designated Nodal Officer (BR officer) heads the BR
function of the Bank. He / She reports directly to the Managing Director & Group Executive (NB), and is
responsible for implementation of the policy, identification of various initiatives and ensuring their effective
implementation by the BR Function staff. The BR Officer, who would head the BR Function is responsible for
implementing the BR initiatives, provide clarifications on the policy, guiding the staff in implementation, review
the results, audit, impact assessment etc.
6.2 Yes, In SBI, an individual/function is appointed to manage sustainability on a day-to-day basis and report to the
company Board. The head of each Bank unit (Branch / Department / Business Group / Vertical) is responsible
for compliance of the BR Policy. He / She would update the BR Officer about the policy implementation,
initiatives taken, discriminatory complaints received, cases of incidents of violation of freedom of association
and collective bargaining etc. The BR Officer would update the Top Management. The BR Policy will be updated
from time to time by the BR Officer i.e. General Manager (Corporate Communication & Change), in the light of
amendments to laws, rules and regulations, as applicable, and an annual review report shall be submitted to
the Board.
In ICICI bank, the CSR Committee would comprise of three or more Directors including at least one independent
Director. The Bank has a CSR Committee which is duly constituted in accordance with the provisions of the Act
with respect to its composition and terms of reference.
6.3 Non existence of linkage in State bank of India and ICICI bank’s Corporate Social Responsibility performance
and remuneration.
7.
Transparency and balance
Transparency can be defined as the complete disclosure of information on the topics and Indicators required
reflecting impacts and enabling stakeholders to make decisions, and the processes, procedures, and
assumptions used to prepare those disclosures.
Table -7
Qualitative aspects
7. Transparency
Sub criteria
State Bank of India
ICICI Bank
7.1 Acknowledgement of challenges, dilemmas and
failures, as well as achievements
2
2
7.2 Use of data to monitor performance year-on-year
4
4
7.3 Presentation of monitored performance, available to
stakeholders.
4
4
Total
10
10
7.1 SBI’s BR report highlights more positive achievements and misses out reporting the key challenges and
dilemmas.SBI has several achievements such as 10,000 of the 15,869 branches are located in rural and semi
urban areas, leader in agricultural finance, have more than 48,000 ATM’s making it the one of the largest ATM
networks in the world and its ATMs are located in all parts of the country including some of the remotest and
inaccessible parts, one of the largest employers in the country having 2,22,033 employees, 100% coverage
under financial inclusion in 31,729 villages during FY 2013-14 etc
ICICI bank’s BR report highlights more positive achievements and misses out reporting the key challenges and
dilemmas. The bank states about achievements such as launch of sustainable banking products to cater to
different classes of customers through an expansive ATM network, mobile, phone, internet, doorstep banking.
Customised products include personal loans, home loans, loans for asset purchases and a wide range of accounts
and deposits. Selection of cards for convenience to complement the distinct lifestyle needs of customers etc.
7.2 State Bank of India and ICICI bank use data to monitor performance since 2012-13.
7.3 SBI and ICICI bank prepares Business Responsibility report in accordance with SEBI requirements and published
on an annual basis. The BR report of SBI can be accessed at bank’s website http://www.sbi.co.in or http://
statebankofindia.com under the link Corporate Governance ’!CSR’!BR Report. The BR report of ICICI bank can
be accessed at bank’s the hyperlink http://www.icicibank.com/aboutus/annual.html.
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November 2015
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Table - 8
Qualitative aspects
Maximum points
State Bank of India
ICICI Bank
1. Strategy, risk and opportunity
12
10
10
2. Materiality
16
8
8
3. Targets and Indicators
16
4
4
4. Suppliers and Value Chain
20
4
4
5. Shareholder Engagement
12
8
8
6. Governance of CR
12
8
8
7. Transparency and Balance
12
10
10
Total
100
52
52
The above data indicates the score obtained by State
Bank of India and ICICI bank after assessing with seven
qualitative aspects.
• SBI’s scores 52 points out of 100 points (falls in the
range of 40-60) which shows its CSR Reporting is
average.
• ICICI bank scores 52 points out of 100 points (falls in
the range of 40-60) which shows its CSR Reporting
is also average.
• SBI and ICICI bank’s CSR reporting scores high points
in strategy, risk and opportunities as well as
transparency and balance.
• SBI and ICICI bank’s CSR reporting scored lowest in
supply chain and satisfied only one criteria.
Suggestions
In order to improve the quality of CSR Reporting the public
and private sector banks need to inculcate several
qualitative sub criteria such as
• Quantify the resulting risks and opportunities
• Continuous regular material assessment
• Consideration of internal and external stakeholders
inputs
• Linkage of CSR performance to remuneration
• Assign targets to relevant material CR issues
• Define KPIs for targets to measure progress against
targets
• Consideration of internal and external stakeholders’
inputs for assessing materiality
• Identification of social and environmental impacts
• Audit suppliers code of conduct
• Set targets for reducing the impact of supply chain
and measure the progress against these targets
• Process to gather views on CSR reporting and
performance from stakeholders
• Linkage of CSR performance to remuneration
• Acknowledgement of challenges and dilemmas
Special Issue
Conclusion
Corporate Social Responsibility is a abroad subject which
leads to variety of opinions and can be considered in a
number of different ways. CSR reporting has gained
prominence in India during recent year after voluntary
guidance was progressively adopted by Securities
Exchange Board of India (SEBI) in 2012 to mandate
compulsory disclosure of adoption of NVG-SEE for the
financial year ending on or after 31 December, 2012.The
quality of CSR reporting of public and private sector banks
are assessed by seven qualitative indicators. The quality
of both CSR reporting is average and can be improved
by adjoining nonexistent indicators. CSR reporting is
now generally considered to be an integral part of strategy
for any organization and built into the strategic planning
process.
This study was to analyze the quality of CSR reporting
and suggest remedies to improve the CSR reporting.
The study has accomplished its objective successfully.
References
• Md. Abdul Kaium Masud, Mohammad Sharif Hossain,
2012, “Corporate Social Responsibility Reporting
Practices in Bangladesh: A Study of Selected Private
Commercial Banks”
• Namrata Singh, Rajlaxmi Srivastava,Rajni Rastogi
2013, CSR Practices & CSR Reporting in Indian
Banking Sector, International Journal of Scientific and
Research Publications, Volume 3, Issue 12,
December 2013
• S. K. Chaudhury, S. K. Das and P. K. Sahoo,
“Practices of corporate social responsibility (CSR)
in banking sector in India: an assessment,” research
journal of economics, business, volume 4, pp.76,
2011P.
• Debnath Rajeev Kumar, 2005, “Societal Governance
and Reporting in India” in sustainability Reporting
Concepts and Experiences, An Edited book, First
edition, Page 134-144
November 2015
Page 33
•
•
•
•
Babita Kundu “ Corporate Social Performance and
Sustainability Reporting - A Comparative Analysis of
selected Indian Companies” International Journal of
Research in Economics and Social Sciences,
Volume 5, Issue 4, Page 156-165
KPMG (2013), India Corporate Responsibility
Reporting Survey 2013
RBI Notification.(2007) .CSR in Indian Banks,
Corporate Social Responsibility, Sustainable
Development and Nonfinancial Reporting- Role of
Banks,RBI/2007-08/216:DBOD No Dir.BC.58/
13.27.00/2007-08,Dec.20. 2)
Sanjay Kanti Das, CSR Practices and CSR Reporting
in Indian Financial Sector, International Journal of
Business and Management Tomorrow ,Sept 2012,
Vol. 2 No. 9. 11)
Special Issue
•
•
•
Suman Kalyan Chaudhury, Sanjay Kanti Das,
Prasanta Kumar Sahoo, Practices of corporate social
responsibility (csr) in banking sector in india:an
assessment, Research journal of Economics,
Business And ICT,Volume-4,2011,Page no.-76.
http://www.sbi.co.in/portal/documents/41076/60023/
1403856255584_SBI_BR_13.06.14.pdf/02c5c712375b-4c97-9c5f-3ea7de70a800
http://www.sbi.co.in/portal/documents/41076/60023/
1371711931453_BR_Report_2013.pdf/776d5e6f-fc2f4200-b12e-cf46360db7f0
November 2015
Page 34
INVESTOR’S PERCEPTION TOWARDS EQUITY AND NON EQUITY
BASED INVESTMENT AVENUES
Cryshal Mathias1
Introduction
India is agrarian based country and culturally Indians are safeguarding their interest against unpredictable future.
Moreover the mixed economy pattern of India allows keeping mass assets and passing the same to their sons and
daughters. Hence investors often invest their excessive earnings in many assets. The investment preferences are
generally classified into two classes’ viz., Equity and Non Equity avenues.
Investment refers to acquisition of some assets. It also means the conversion of money into claims on money and
use of funds for productive and income earning assets. In essence, it means the use of funds for productive
purposes, for securing some objectives like income, appreciation of capital or capital gains, or for further production
of goods and services with the objective of securing profits. Investment activity involves the use of funds or savings
for further creation of assets or acquisition of existing assets. In simple words investment is the use of money for
the purpose of making more money, to gain income, increase capital or both.
An investor has numerous investment options to choose from, depending on his risk profile and expectation of
returns. Different investment options represent a different risk-reward trade off. Low risk investments are those that
offer assured, but lower returns, while high risk investments provide the potential to earn greater returns. Hence, an
investor’s risk tolerance plays a key role in choosing the most suitable investment.
Banks today provide a range of investment options, including international investing, investing in commodities,
stocks, bonds, precious metals and investment funds. Other options for investing include certificates of deposit,
futures and investment clubs.
All investment options have their inherent risk and benefits. For instance, international investing is prone to social,
political, economic and currency risks, while fixed income investing is prone to interest risks.
A comparison of different investment options with respect to their Performance is as shown in the following table.
Table - 1
Options
Returns
Safety
Volatility
Liquidity
Convenience
Equity
High
Low
High
High/Low
Moderate
FI Bond
Moderate
High
Moderate
Moderate
High
Cooperate Debenture
Moderate
Moderate
Moderate
Low
Low
Company FD
Moderate
Low
Low
Low
Moderate
PPF
Moderate
High
Low
Moderate
High
LIC
Low
High
Low
Low
Moderate
Gold
Moderate
High
Moderate
Moderate
Low
Real Estate
High
Moderate
High
Low
Low
Mutual Fund
High
High
Moderate
High
High
Bank Deposit
Low
Low
Low
High
High
There are a lot of investment avenues available today in the financial market for an investor with an investable
surplus. He can invest in Bank Deposits, Corporate Debentures, and Bonds where there is low risk but low return.
He may invest in Stock of companies where the risk is high and the returns are also proportionately high. The recent
trends in the Stock Market have shown that an average retail investor always lost with periodic bearish tends.
1
. St. Agnes Centre for Post Graduate Studies & Research, Mercara Hill Road, Mangalore.
Special Issue
November 2015
Page 35
People began opting for portfolio managers with expertise
in stock markets who would invest on their behalf. Thus
we had wealth management services provided by many
institutions. However they proved too costly for a small
investor. These investors have found a good shelter with
the mutual funds.
restricted in terms of place, the respondents are largely
from Mangalore city. The research has been conducted
on various investors of different areas as the study tries
to attain a holistic understanding of the opinions of the
investors with regard to different aspects of investments
and investing activity.
Statement of the Problem
The market is highly volatile, the preferences of the
investors differs from one another. Investors plan their
investments on the basis of liquidity, rate of returns, risk
factors etc. The various investment avenues investors
can invest are Bank Deposits, Corporate Debenture and
Bonds, he can also invest in the stock of companies
where risk is high and the returns are also proportionately
high. This study is an attempt to find out the major factors
influencing the investor’s perception towards equity and
non equity based investment avenues.
Hypothesis
H0: Most of the investor’s prefer non equity avenues of
investment, due to risk factor.
Sampling Technique
This study is conducted on a sample size of 50
respondents who were selected through random
sampling technique.
Statistical Tools
• Chi-square test
Need For the Study
India is well emerging as an important investment
destination. It’s on course to become a major economic
power. The country is seeing huge domestic and foreign
investments but current global financial scenario which
is not very positive has left a bad taste in the mouth of
investors. The capitals markets boom is slowly
decreasing and there is a trend shift in the investments,
people again prefer investments with greater liquidity.
The motive for this study has been the dynamic changes
that take place in the investment circles, the markets
and their impact on the investors and investments and
as a result the behavior of the investors and their
perceptions, understandings and also opinions about
different investments tools that they feel are best. By
this the future prospects of individual tools also is needed
to be studied.
Objectives
Savings is necessary but just saving is not enough,
investing these savings becomes even more important.
Each investor need to invest intelligently in order to
have enough money available for funding children’s
education, buying and maintaining a house or for one’s
own golden years. Keeping these goals in mind various
investors choose different opportunities and tools in
orders to attain their personal goals and during such an
investment activity every investor gains experience and
different perceptions towards different avenues and
investment tools might be built based on these
experience. Objective of this study is to understand this
perception.
Scope of the Study
This study primarily deals with the perceptions of the
investors who invest in conventional and non conventional
investment avenues. Although the research is not
Special Issue
According to S.Kevin, Investment is an activity that is
engaged in by people who have savings, i.e. investments
are made from savings, or in other words people
investment their savings. But all savers are not investors.
Investment is an activity which is different from savings.
Thus investment may be defined as “a commitment of
funds made in the exception of some positive rate of
return”. Exception of return is an essential element of
investment. Since the return is expected to be realized
in future, there is possibility that the return actually
realized is lower than the return expected to be realized.
The possibility of variation in the actual return is known
as investment risk. Thus every investment involves return
and risk
According to Ravi M. Kishore, Investment decisions
are those which determine how scare resources in terms
of funds available are committed to projects .The project
may be as small as purchase of equipment or as big as
acquisition of an entity. Investment in fixed assets
requires supporting investment in working capital in the
form of inventory, receivable, cash etc. Investment which
enhances internal growth is termed as ‘internal
investment’ and acquisition of entities represents
‘external investment’. The investment decision should
aim at investment in assets only when they are expected
to earn a return greater than a minimum acceptable
return which is also called as Hurdle Rate.
Company analysis
The purpose of company analysis is to help the investors
to make better decisions. The company’s earnings,
profitability, operating efficiency, capital structure and
management have to be screened. These factors have
direct bearing on the stock prices and the return of
investors. Appreciation of the stock value is a function
to the performance of the company. Company with high
November 2015
Page 36
product market share is able to create wealth to the
investors in the form of capital appreciation
Construction of Portfolio
A portfolio is a combination of securities. The portfolio is
constructed in such a manner to meet the investor’s
goals and objectives. The investor should decide how
best to reach the goals with the securities available.
The investor tries to attain maximum return with minimum
risk. Towards this end he diversifies his portfolio and
allocates funds among the securities.
Evaluation
The portfolio has to be managed efficiently. The efficient
management calls for evaluation of the portfolio. This
process consists of portfolio appraisal and revision
Appraisal
The return and risk performance of the security vary from
time to time. The variability in return of the securities is
measured and compared. The developments in the
economy, industry and relevant companies from which
the stocks are bought have to be appraised. The
appraisal warns the loss and steps can be taken to avoid
such losses.
Revision
It depends on the results of the appraisal. The low
yielding securities with high risk are replaced with high
yielding securities with low risk factor. To keep the return
at a particular level necessitates the investor to revise
the components of the portfolio periodically.
Investment Avenues
The various types of investment are:
Cash investments: These include bank savings
accounts, certificates of deposit (CDs) and treasury bills.
These investments generally pay a low rate of interest
and are risky options in periods of inflation.
Debt securities: This form of investment provides returns
in the form of fixed periodic payments and possible
capital appreciation at maturity. It is a safer and more
‘risk-free’ investment tool than equities. However, the
returns are also generally lower than other securities.
Stocks: Buying stocks (also called equities) makes you
a part-owner of the business and entitles you to a share
of the profits generated by the company. Stocks are
more volatile and therefore riskier than bonds.
Mutual funds: This is a collection of stocks and bonds
and involves paying a professional manager to select
specific securities for you. The prime advantage of this
investment is that you do not have to be involved in
tracking the investment. There may be bond, stock- or
index-based mutual funds.
Special Issue
Derivatives: These are financial contracts which are
derived from the value of the underlying assets, such as
equities, commodities and bonds, on which they are
based. Derivatives can be in the form of futures, options
and swaps. Derivatives are used to minimize the risk of
loss resulting from fluctuations in the value of the
underlying assets (hedging).
Commodities: The items that are traded on the
commodities market are typically agricultural and
industrial commodities. These items need to be
standardized and must be in a basic, raw and
unprocessed state. The trading of commodities is
associated with high risk and high reward. Trading in
commodity futures requires specialized knowledge and
in-depth analysis.
Real estate: This investment involves a long-term
commitment of funds and gains that are generated
through rental or lease income as well as capital
appreciation. This includes investments into residential
or commercial properties.
Table - 2
Sr. Golden Rules of investment Amount of Investment Decision
Risk
No Growth Returns Liquidity
1
↑
↑
↑
Low
2
↔
↔
↔
Moderate
Average Investment
3
↓
↓
↓
High
Search for Investment
Good Investment
Here, ↑ = Increase in Value; ↔ = Normal or No increase in value;
↓ = Decrease in value.
Golden Rules of Investment
Table - 3 : Showing Avenues of Investment.
Avenues of
investment
Sample size(50)
Sample size (%)
Equity
12
24
Non equity
25
50
Both
13
26
The above chart gives a break up of avenues of
investments respondents have invested in, it is found
out that majority were non equity investors, 24% invested
in equity related avenues, and nearly one fourth that is
26% also invested in both. This shows that a lot of people
invest in non equity where as there are good number
who invest in both as well but interesting fact was that
there were pure equity investors also.
November 2015
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Table - 4 : Showing the Sectors in Which the
Investor Has Invested
Sectors
invested
Sample size(50)
Sample size(%)
Commodities
1
2
Realty
8
16
Bank F D
15
30
Mutual funds
12
24
PPF
5
10
Postal schemes
7
14
Others
2
4
Annual income
earned by investment
Table - 5 : Showing Amount Invested In Equity
Base Avenues.
Sample size (%)
less than 1 lakh
23
46
1 lakh to 2 lakhs
17
34
2 lakhs to 5 lakhs
6
12
More than 5 lakhs
4
8
The above chart represents the amount invested in equity
based avenues out of which 46% of the respondents
invest less than one lakh, 34% of the respondents invest
from one lakh to two lakhs,12% of the respondents invest
from two lakh to five lakhs and remaining 8% of the
respondents invest more than five lakhs. Here although
there is a considerable amount of investment below a
lakh and one to two lakh, it shows that investment is
not to the tune of huge amount, but there can also be
seen good amount of investment in the higher category.
Table - 6 : Showing The Amount Invested In Non
Equity Avenues
Amount invested
in equity market
Sample size(50)
Sample size (%)
less than 1 lakh
13
26
1 lakh to 2 lakhs
21
42
2 lakhs to 5 lakhs
5
10
11
22
More than 5 lakhs
Special Issue
The above chart represents the amount invested in non
equity avenues out of which 26% of the respondents
invest less than one lakhs, 42% of the respondents invest
from one lakhs to two lakhs,10% of the respondents
invest from two lakhs to five lakhs and remaining 22% of
the respondents invest more than five lakhs. Unlike the
equity avenues there seems to be a good division. It
appears that these amounts are invested to the extent
the investor wants safety
Table - 7 :Showing Annual Income Earned By
Investment
The above chart shows the sectors, in which the investors
have invested in , 2% of them have invested in
Commodities, 16% of them in Realty, 30% of them in
Bank FD, 24% of them in Mutual Funds ,10% of them in
PPF , 14% of them in Postal Schemes and 4% of them
in others . This shows that people invest in various
sectors so as to maximize returns and to minimize risk
Amount invested Sample size(50)
in equity market
Sample size(50) Sample size (%)
0 to 50,000
32
64
50,000 to 1Lakh
11
22
1 lakh to 2lakhs
4
8
2 lakhs and above
3
6
The above chart shows the Annual income earned by
investment. It is clear from the above chart that 64% of
the respondents earn an annual income between 0 to
50,000, 22% of the respondents earn between 50,000
to 1Lakh, 8% of the respondents earn between 1 lakh to
2lakhs and remaining 6% of the respondents earn 2
lakhs and above. This indicates that the greater part of
the investors earned around Rs. 50000 annually
Table - 8 : Showing Percentage of Annual
Returns Expected By The Investor
The Percentage of
Annual Return
expected by the
investor
10% to 20%
36
72
20% to 30%
6
12
30% to 40%
6
12
More than 40%
2
4
The above chart indicates about the percentage of annual
returns expected by the investor in which 72% of the
respondents expected annual returns of 10%-20%, 12%
of the respondents expected annual returns of 20%-30%,
12% of the respondents expected annual returns of 30%40% and remaining 4% of the respondents expected
annual returns of more than 40%. This shows that since
the larger portion was in non equity based avenues and
mixture of both, the investors were aware of the possible
returns and hence expectations were within 20%
November 2015
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Table - 12 : Showing Trading Done By the
Investor In Terms of Period
Table -9 : Showing Percentage Of Annual Returns
Received By The Investor
The Percentage of
Annual Return
received by the
investor
10% to 20%
38
76
20% to 30%
6
12
30% to 40%
4
8
More than 40%
2
4
The above chart reveals about the percentage of annual
returns received by the investor out of which 76% of the
respondents received annual returns of 10%-20%, 12%
of the respondents received annual returns of 20%-30%,
8% of the respondents received annual returns of 30%40% and remaining 4% of the respondents received
annual returns of more than 40%. This indicates that a
majority yield was as expected within 20%
Table - 10 : Showing Whether the Investor Is
Happy With The Returns Earned On Equity
Investment And Non Equity Investment
Whether the investor is
happy with the returns
earned on his/her equity
investment and non
equity investment
Equity
investments
Non equity
investments
Satisfied
5
20
Not satisfied
20
5
This chart reveals that most of the investors are satisfied
with non equity investments compared to equity
investments.
Table - 11 : Showing Time Spent By the Investor
on Investing Process on Weekly Basis.
Time spent by the
investor on investing
process on weekly
basis.
How often you
trade/invest
Daily
5
10
Weekly
8
16
Monthly
19
38
Annually
18
36
The above chart indicates about how often does the
investor trade/invest out of which 10 % of the respondents
trade daily, 16% of the respondents trade weekly, 38%
of the respondents trade monthly and 36% of the
respondents trade annually.
Table - 13 : Showing the Equity Investment
Avenues Preferred By an Investor
Investment avenue
preferred by the
investor-equity
Shares and stock
15
30
Equity funds
24
48
Others
11
22
The chart reveals the equity investment preferred by an
investor which shows that 30% prefer shares and stocks,
48% prefer equity funds and 22% other equity related
investments are preferred.
Table - 14 : Showing the Non Equity Investments
Preferred By an Investor
Non equity avenues Sample size (50) Sample size (%)
preferred by investor
Bank F D
21
42
Debt funds
5
10
PPF
8
16
Postal schemes
12
24
4
8
8 hours
6
12
others
5 to 7 hours
6
12
3 to 5 hours
6
12
less than 3hours
32
64
The above chart shows the non equity investments
preferred by an investor. 42% of the investors prefer Bank
FD, 10% of the investors prefer Debt Funds, 16% of the
investors prefer PPF, 24% of the investors prefer Postal
Schemes, 8% of the investors prefer other avenues.
The above chart indicates about the time spent by the
investor on investing process on weekly basis. It is clear
from the above chart that 12% of the respondents spend
less than 8 hours, 12% of the respondents spend 5 to 7
hours, 12% of the respondents spend 3 to 5 hours and
remaining 64% of the respondents spend less than 3
hours.
Special Issue
November 2015
Page 39
Table - 15 : Showing the Reason for Preference
of Investment
Reasons for
preference of
investment
Risk factor/safety
11
22
Returns
23
46
Easy process
2
4
Time factor
12
24
others
2
4
•
The above chart shows the reason for the preference of
investment. 22% of the investors invest because of the
risk factor/ safety, 46% of the investors invest because
of the returns they get, 4% of the investors feel it’s easy,
24% of the investors invest due to time factors, 4% of
the investors invest due to some other factors.
Findings, Suggestions and Conclusion
Findings
• In the study, majority of investors are male and
majority of respondents are between the age group
of 18-35 years.
• Majority of respondents are employed and self
employees people which show that employed people
invest their salary in various avenues.
• The study reveals that most of the respondents are
educated
• The annual income of majority of respondents lies
between Rs. 50000-200000
• The investors invest their money with a purpose of
capital growth. Some of them also consider income
and safety as the reasons behind their investments.
• Most of the investors prefer non equity avenues of
investment. And around 36% of investors invest 2
lakhs to 5 lakhs in these avenues as per the study.
• The percentage of annual returns expected by the
majority of the investors is between 10-20% and
financially actual returns earned by the investors are
around 50000.
• Most of investors are not satisfied with the returns
earned on equity investor. But 46% of respondents
are happy with the returns earned on non equity
investments.
• An investor spends less than 3 hours on investing
process on weekly basis and feels that internet and
TV is the best source of information to the investor to
invest in different securities.
• Majority of investors prefer are equity funds when
compared to shares and stock under equity based
investment avenues as 34% of investors find equity
Special Issue
•
market very risky, Whereas in case of non equity
avenues they prefer bank F D and around 12%
respondents prefer postal schemes.
Safety, returns and time factor are the reasons for
the preference of investment by an investor.
Due to the risk involved in non equity based avenue
banks and mutual funds are considered to be
suggested routes of investment for a new investor.
Suggestions
• Create awareness about equity investments by giving
education about the actual ways to invest effectively
and the right investments for the right persons
• Public should be made aware about the numerous
investment opportunities available for different people
to invest their money based on the risk
• Better customer services should be provided during
the investment process so that the customers have
a good experience during investment. It should be
made simple and easy for everyone to understand
• A good advisory service is the key to the development
of the market. The different intermediaries should
provide correct advice based on the need of the
investor and try to see that he is benefited as a result
of which greater confidence is built
• The procedure of investment should be made even
easier. Research should be conducted to see to it
that problems and hassles during investments are
found out and it is rectified
Conclusion
Financial investment is the allocation of funds to assets
and securities after considering their return and risk
factors. Investor plans for a long horizon after considering
the fundamental factors and assumes moderate risk.
The main objective of rational investors are maximizing
returns and minimizing risk. Safety of the principal,
tradability and liquidity are his subsidiary objectives.
Equity shares have the right to receive dividend and
residual claim, but these are highly risky compared to
the non equity investments.
The present study shows that the people invest more on
non equity based investments compared to equity
investments due to risk safety and time factor.
Bibliography
Articles:
• Black, modelling consumer choice of distribution
channel, an illustration from financial services,
international journal OF bank marketing,
VOL.20.NO4, 2002, PP 161-173.
• Manish mirral and R. K. VYAS, Demographic and
investment choice among Indian investors, review of
business and technology research, vol.3.no1, 2007
November 2015
Page 40
•
Menu verma, wealth management and behavioural
finance personality on investment choice among
Indian investors, the 1up journal of behavioural
finance,2008,pg-20
Special Issue
Webliography
www.thefreedictionary.com/agrarian
shodhganga.inflibnet.ac.in/bitstream
www.care.ac.in
November 2015
Page 41
A PREDICTION MODEL FOR ORGANIZATIONAL ROLE STRESS BASED
ON BACK PROPAGATION NEURAL NETWORK
Deepa Mohan1
Sudarsan N2
Abstract
Organizations want to maximize the efficiency by minimizing stress, as increased levels of stress may have significant
implications on organizational performance and will lead to low commitment, high absenteeism and turnover rates,
and also overall wellbeing of employees. The study undertakes the examination of organizational role stress among
employees working in IT industry of South India. This study investigated the impact of emotional intelligence,
organizational commitment and attitude towards change on organizational role stress using artificial neural network
on Mat Lab software. Results of the analysis illustrated that the model is a good predictor model.
Key words: emotional intelligence, organizational commitment, attitude towards change, organizational role stress,
artificial neural network
Introduction
India with its strategic positioning has evolved into a
major destination for IT based organizations and has
been recognized to be among the top ten high stress
workplaces. Estimating the level of role stress among
employees in such industries undoubtedly is not only
important in alleviating factors influencing stress but also
helpful in devising coping strategies. This paper is
devoted to, presenting the details of investigation carried
out towards identifying major factors that can be
important in estimation of role stress levels among
employees particularly engaged in the IT sector of South
India using back propagation neural network.
The method of data collection and analysis of data set
using statistical methods were portrayed
comprehensively in many researches. Among those
statistical methods, multiple regression analysis is one
of the most widely used methods for modeling. However,
the modeling method using a multiple regression
analysis has a significant flaw as it ignores RMSEA value
of the model. To offset this deficiency, artificial neural
networks (ANNs) can be used. This study is devoted to
present the details of artificial neural network model to
estimate Organizational Role Stress (ORS) among IT
sector employees of South India. The ANN developed
employs back propagation approach with Emotional
Intelligence (EI), Organizational Commitment (OC) and
Attitude towards Change (ATOC) as the input nodes.
This study mainly focuses on the extent of stress
experienced by the employees particularly in the IT sector
owing to the unique work environment prevailing.
1
2
According to Selye Hans (1956) work stress manifesting
in the form of Organizational Role Stress (ORS)
explained as the conflict and tension due to the roles
being enacted by a person at any given point of time.
Pareek (2010) had classified organizational role stressors
in to ten different classes such as
• Inter-role distance (IRD): Conflict between
organizational and non-organizational roles.
• Role stagnation (RS): The feeling of being stuck in
the same role.
• Role expectation conflict (REC): Conflicting
expectations and demands between different role
senders.
• Role erosion (RE): The feeling that functions that
should belong to the respondent’s role are being
transformed/performed or shared by others.
• Role overload (RO): The feeling that more is expected
from the role than the respondent can cope with.
• Role isolation (RI): Lack of linkages between the
respondent’s role and that of other roles in the
organization.
• Personal inadequacy (PI): Inadequate knowledge,
skills, or preparation for a respondent to be effective
in a particular role.
• Self-role distance (SRD): Conflict between the
respondent’s values/self-concepts and the
requirements of his or her organizational role.
• Role ambiguity (RA): Lack of clarity about others’
expectations of the respondent’s role, or lack of
feedback on how others perceive the respondent’s
performance.
. Ph. D Scholar, Department of Mechanical Eng, National Institute of Technology Calicut, Kerala.
. Professor, School of Management Studies, National Institute of Technology Calicut, Kerala.
Special Issue
November 2015
Page 42
•
Resource inadequacy (RIn): Non availability of
resources needed for effective role performance.
According to Schutte (1998), EI is defined as the “ability
to adaptively recognize emotion, express emotion,
regulate emotion and harness emotions”. EI guide us to
respond appropriately to different stressors and is one
of the essential factors. Rahim (2010) assessed the
relationship of Stress and Emotional Intelligence
competencies among the employees of Pakistan Banks
who work under stressful conditions. The results showed
that the EI competencies have positive and strong impact
on stress and identified more than 75% employees of
banking sector experienced stress.
Porter et al. (1976) defined Organizational Commitment
(OC) as the relative strength of an individual’s
identification and involvement in a particular organization.
i) Affective commitment refers to employees’ emotional
attachment, identification with, and involvement in the
organization. Employees with a strong affective
commitment stay with the organization because they
want to.
ii) Continuance commitment refers to employees’
assessment of whether the costs of leaving the
organization are greater than the costs of staying.
Employees who perceive that the costs of leaving
the organization are greater than the costs of staying
remain because they need to.
iii) Normative commitment refers to employees’ feelings
of obligation to the organization. Employees with high
levels of normative commitment stay with the
organization because they feel they ought to.
Mohamadkhani and Lalardi (2012) established explicit
relationship between emotional intelligence and
organizational commitment in his study of the hotel
staff in 5-Star hotels of Tehran, Iran.
There is evidence in the change management literature
identifying the role of organizational commitment in a
change context. Cameron (2010) determined the levels
of employee commitment and employee perceptions of
the planned organizational changes. The research was
conducted in a large telecommunication organization in
South Africa with over 20,000 employees The results
collected for this research indicated positive correlations
between affective commitment and employee attitudes
and perceptions of change. The results also suggested
that higher levels of affective commitment are associated
with more positive perceptions of change.
Questionnaire Design
The questionnaire for the investigation was developed
using instruments established through previous
researches. The EI level was measured with The
Emotional Intelligence Scale developed by Schutte et
Special Issue
al. (1998) comprising 33 items classified into four
dimensions namely
i) Perception of emotion (P0FE) evaluated by 10 items;
ii) Managing others emotions (MOTE) by 8 items,
iii) Managing own emotions (MOWE) by 9 items and
iv) Utilization of emotion (UOFE) by 6 items, each
assessable with a five-point liker-type scale.
The organizational role stress (ORS) scale, which was
developed and standardized by Pareek (2010) to measure
the role stress, had been used in this study. The ORS
instrument comprised of 50 items to measure 10 different
types of role stressors (5 statements for each role
stressor) assessable on a five point liker scale.
Instrument developed by Allen and Meyer (1990) with 18
items classified in to three dimensions, namely:
i) Affective commitment (AC);
ii) Continuance commitment (CC); and
iii) Normative commitment (NC) assessable with five
point liker scale for measurement of OC was
employed in this study.
Socio-demographical characteristics of the employees
were categorized as personal attributes, comprising age,
gender, family status, number of children, educational
qualification, native place, number of family members
and earning members and annual income; job attributes
that includes number of days leaves availed, total
experience, job overtime, salary satisfaction, challenging
nature of work, recognition and appreciation for employee
contribution and effective skill application and
environmental attributes such as experiencing
organizational change and attitude to change. Five items
that measure attitudes to change were chosen from the
instrument Attitude to Change Questionnaire (ACQ)
developed by Vakola et al. (2003). Employee details on
the socio-demographical characteristics had been
compiled through additional 23 items as indicated above.
Thus the instrument developed for the study comprised
a total of 129 items essentially derived from the well
established instruments reported in literature.
Data Collection and Analysis
The population chosen for the study had been drawn
from among individuals employed in IT sector, \ working
in Bangalore located in the southernmost part of India.
Study sample had been chosen with random sampling
technique. The study conducted through personal
interview yielded 158 duly completed questionnaires from
a total of 180 distributed resulting in a response rate of
87.78%. The minimum sample size needed for this study
estimated based on Bill Godden (2004), recommends
383 for estimated population size of 60,000 having 50%
response distribution with 5% margin of error and at 95%
confidence level. The estimate was subsequently verified
November 2015
Page 43
through software developed by Raosoft. Inc. (2004). Data
collected in this investigation was analyzed using
Statistical Package for Social Sciences (SPSS). The
high Chronbach’s alpha values indicate a high internal
reliability of the questionnaire developed and utilised in
the study. Step wise regression was employed with
components of EI & OC, attitude towards change and
socio-demographical variables as independent variables
and ORS being the dependant variable to establish model
that can be used to estimate stress levels among
individuals in IT sector ( Deepa & Sudarsan, 2013). To
offset the deficiency of regression model, artificial neural
networks (ANNs) was used. The back propagation neural
network of ANN was employed to predict Organizational
Role Stress (ORS) among IT sector employees of South
India.
Artificial Neural Network
The artificial neural network (ANN) as an alternative
approach to linear regression has gained popularity in
different fields. Many studies in the social sciences used
ordinal scales to measure a respondent’s attitude by
asking a question with a range of responses. According
to Cohen et al. (2007), assuming the difference between
an attitude of ‘strongly disagree’ and ‘disagree’ is being
equal to the difference between other consecutive levels
of response on the likert-type scale cannot be legitimate.
This study described the use of the artificial neural
network (ANN) model, particularly an ANN model with
back-propagation algorithm to analyse ordinal data, a
more appropriate level of measurement for ORS.
Artificial neural networks (ANNs) are simplified models
of the central nervous system and are analytic
techniques modelled on the learning processes of the
human cognitive system and the neurological functions
of the brain. Numerous studies applied ANNs for
prediction and classification research in the sciences
and social sciences. Garver (2002) noted that ANNs
overcome the limitations in conventional statistical
applications.
The artificial neural network (ANN) simulates the
important operation features of human nervous system
to determine solutions by using information gained from
historic data (Pai et al., 2013). To operate like a human
brain, ANN uses many computational units called
artificial neurons that are interrelated by various weight
functions. Although each neuron can only perform a
simple computation, an ANN can perform complicated
calculations based on the multiple level structure of a
network of connected neurons. An ANN is composed
mainly of three independent layers: input, hidden, and
output layers as shown in Figure 1. Each layer contains
many operation neurons. Input neurons accept the input
values that are fed to the ANN, meanwhile the
computational values in the output layer are determined
by the output neurons. The hidden layers act as
interfaces to relate input and output layers. Each neuron
is linked to every neuron in adjacent layers by a weight
function. Each neuron sums all of the values from
previous inputs converts the sum to an output value. To
a prediction problem, a supervised learning algorithm is
often utilized to train ANN. The back propagation
algorithm (BPNN) is commonly selected to direct ANN.
The steepest gradient descent method is commonly used
to minimize the errors between the BPNN outputs and
observations. The calculation of BPNN was carried out
using Mat Lab. (Fig. 1)
Fig. 1 : Artificial neural network
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November 2015
Page 44
Back-propagation neural network
Artificial neural networks can be classified into several
categories based on supervised and unsupervised
learning methods and feed-forward and feedback recall
architectures. A Back-propagation neural network, BPNN
is a neural network that uses a supervised learning
method and feed-forward architecture. A BPNN is one of
the most frequently utilized neural network techniques
for classification and prediction (Wu et al., 2006) and is
considered as advanced multiple regression analysis
that can accommodate complex and non-linear data
relationships (Jost, 1993). The learning algorithm in a
BPNN differs from traditional feed-forward neural
networks: first, a BPNN uses an activation function for
the hidden unit and not the input value; and, second,
the gradient of the activation function is contained (Law,
2000). The output of a BPNN is compared with the target
output and an error is calculated for each training
iteration. This error is then back propagated to the neural
network and utilized to adjust the weights, thereby
minimizing the mean squared error between the
network’s prediction output and the target output.
Consequently, the BPNN model yields predictive output
that is similar to the target output.
Garver (2002) noted that ANNs overcome the limitations
of conventional statistical models that are typically visible
in customer satisfaction research, and that ANNs are
well-suited to evaluating the relative importance of
customer satisfaction attributes. It was concluded that
the capability of ANNs in modeling non-linear interactions
improve model prediction performance and variance
interpretation.
Parameters Used In the Determination of BPNN
The input parameters are the four dimensions of
Emotional Intelligence, three components of
organizational commitment, five items of attitude towards
change and output variable is organizational role stress.
These data were imported to the Mat Lab to examine
the model using BPNN algorithm.
Determination of BPNN
The weighted sum of the input components is calculated
with equation
f (X) = X1W1 + X2W2 + ……. + XnWn.
The output is calculated with a sigmoid function as follows:
OUT = 1 / 1 + e -f (X)
The training of the network is accomplished by adjusting
the weights and is carried out through a large number of
training sets and training cycles (epochs). The goal of
the learning procedure is to find the optimal set of
weights. The output of the network is compared with a
desired response to produce an error. The performance
is measured in terms of a desired signal and the criterion
for convergence.
The appropriate BPNN model was designed to predict
ORS among the employees in IT sector. The BPNN model
was comprised of three layers: input, hidden, and output
layers. There are twelve input values and one target value
connected by twelve hidden neurons. The network was
trained to fit the inputs and targets using Levenberg
Marquardt back propagation method as shown in Figure
2. The sample size chosen for the study was 255, out of
which 80% (204) was taken for training, 10% (26) for
testing and 10% (26) for validation.
Fig. 2 : Neural network of the study
The training epochs were set at 1000. BPNN compute the error vectors backward, starting from the final layer going
through the network backward and finds out a function that best maps a set of inputs to its correct output.
Special Issue
November 2015
Page 45
In order to evaluate the prediction accuracy of BPNN, mean squared error (MSE), and root mean squared error
(RMSE) have been adopted. Root mean squared error is the square root of average squared difference between
outputs and targets. Lower values are better and zero means no error. The RMSE value of the ANN model was found
to be 0.06.
The regression plots are given in Figure 3; the regression, R, values measure the correlation between outputs and
targets. An R-value of one means a close relationship and zero means a random relationship.
Fig. 3 : Regression plots of ORS from BPNN
From the regression plots, the R-value is 0.93 and RMSE is 0.06. The observed and predicted values of ORS for a
sample size of 255 from BPNN are given in Figure 4. The results from BPNN revealed that the model is a good
predictor model, as the observed and predicted values agree with each other. Consequently, the ORS model developed
for this study can be used as a predictor model. (Fig. 4)
Conclusions
The study examined the applicability of modeling the dependence of ORS upon organizational parameters such as
EI, OC, ATOC and demographical characteristics through BPNN. This is a pioneering attempt to model with ANN,
not only towards understanding the intricate relationship between the variables, but also in demonstrating a more
accurate interdependence model. The reliability and validity of the data set are verified through confirmatory factor
analysis. Results obtained through BPNN illustrated the model as a good predictor model and the least influence of
socio-demographical variables on ORS.
Special Issue
November 2015
Page 46
250
ORS
200
150
100
Sample size
50
Observed
values
0
0
20
40
60
80
100 120 140 160 180 200 220 240 260 280
Fig. 4 : Predicted and observed values for ORS
References
• Cohen, L., Manion, L., Morrison, K., & Morrison, K. (2007). Research methods in education. 6th edition, New
York: Routledge.
• Pareek, U., & Purohit, S. (2010). Training instrument in HRD and OD. 3rd edition, New Delhi: Tata McGraw-Hill.
• Selye, H. (1956). The stress of life. New York: McGraw-Hill.
• Allen, N. J., & Meyer, J. P. (1990). ‘The Measurement and Antecedents of Affective, Continuance and Normative
Commitment to the Organization’. Journal of Occupational Psychology, 63.
• Cameron, M. V. (2010). ‘The Relationship between Employee Attitudes Towards Planned Organisational Change
and Organisational Commitment: An Investigation of a Selected Case within the South African Telecommunications
Industry’, Dissertation, Cape Peninsula University of Technology, South Africa.
• Cohen, A. (1992). ‘Antecedents of organisational commitment across occupational groups: A Meta-Analysis’.
Journal of Organisational Behaviour, 13.
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November 2015
Page 47
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Cronbach, L. J. (1951), ‘Coefficient Alpha and the
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Sector: An Indian Experience’. International Journal
of Human Resource Management and Research, 3.
Garver, M. S. (2002). ‘Using Data mining for customer
satisfaction research’. Marketing Research, 14.
Jost, A. (1993). ‘Neural networks: A logical
progression in credit and marketing decision system’.
Credit World, 81.
Law, R. (2000). ‘Back-propagation learning in
improving the accuracy of neural network-based
tourism demand forecasting’. Tourism Management,
21.
Mohamadkhani, K., & Lalardi, N. M. (2012).
‘Emotional Intelligence and Organizational
Commitment between the Hotel Staff in Tehran, Iran’.
American Journal of Business and Management, 1.
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Pai, T.Y., Hanaki, K., Su, H.C., Yu, L.F. ( 2013). ‘A
24–h forecast of oxidant concentration in Tokyo using
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Rahim,S.H. (2010). ‘Emotional Intelligence and
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(1998). ‘Development and validation of a measure of
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Differences.
November 2015
Page 48
CONSUMER BEHAVIOUR TOWARDS ORGANIC VEGETABLES
Divya Vijayan1
Dr.K.N.Ushadevi2
Abstract
As vegetables constitute a major portion of food consumption of people, changes has undergone in the nature, type
and quality of vegetables that is to be consumed by them. Now a day’s vegetables are used not only to add their food
habit but to provide nutrient and prevent nutritious related diseases and improves physical and mental well being of
consumers. So this Paper aimed to study the consumer behaviour towards organic vegetables. The sample of 60
consumers was selected and survey was conducted by using pre structured questionnaire. Index method was mainly
used for statistical purpose. The study found that Attitude and satisfaction level of consumers towards organic vegetables
shows significant difference among consumers. Consumers overall attitude towards organic vegetables were also
not favourable due to its high price and non availability. However they agree with the health aspects, quality, nutrient
value and environmental friendly nature of the organic vegetables.
Key words:
Introduction
The US Department of Agriculture defines organic farming
thus “Organic farming is a production system which
avoids or largely excludes the use of synthetically
compounded fertilisers, pesticides, growth regulators and
livestock feed additions.
To the maximum extent feasible, organic farming
systems rely on crop rotations, crop residues, animal
manures, legumes, green manures, off- farm organic
wastes and aspects of biological pest control to maintain
soil productivity and tilth, to supply plant nutrients and
to control insects, weeds and other pests” (Lampkin,
1990).
The term consumer behavior can be defined as the
behavior that consumers display in searching for
purchasing, using, evaluating and disposing of product
and services that they expect will satisfy their needs.
One of the objectives of the present study is to examine
the consumer behavior towards organic vegetables.
Recent trends in final food demand show that it plays
an important role in the maintenance of health on psycho
physical well being and prevention of certain diseases.
As vegetables constitute a major portion of food
consumption of people, changes has undergone in the
nature, type and quality of vegetables that is to be
consumed by them. Now a day’s vegetables are used
not only to add their food habit but to provide nutrient
and prevent nutritious related diseases and improves
physical and mental well being of consumers. In the
context of changing behavior of consumers towards
vegetables to study their behavior towards organic
vegetables which are high nutrient, pesticide free and
1
2
which protect them from health related issues is very
important.
Statement of Problem
“The current farming systems lay emphasis on high
yields which are achieved by intensive use of fertilizers,
pesticides and other off-farm inputs. Alternate farming
systems range from systems which follow only slightly
reduced use of these inputs through the better use of
soil tests, cultivation of crops only on soils best suited
to them, integrated use of pest management, etc,. to
those that seek to minimize their use through appropriate
crop rotations, integration of livestock with crop
husbandry, mechanical or biological control of weeds
and less costly buildings and equipment. So for
agriculture to be sustainable, it should include a spectrum
of farming systems ranging from organic systems that
greatly reduce or eliminate use of chemical inputs to
those involving the prudent use of antibiotics to control
specific pests and diseases’ (Kerala Land Use Board,
1997) In the past 10-15 years, many farmers in Kerala
other than those who continued the traditional methods,
have taken up organic farming quite earnestly. Those
who reverted from modern intensive agriculture to organic
farming had to face many immediate problems. Sudden
withdrawal of the external inputs led to steep fall in yield.
The high yielding varieties of seeds had to be replaced
by indigenous ones. The gap of 30 - 40 years created a
vacuum in the knowledge of traditional agricultural
practices. The prevalence of modern agriculture in the
majority of the cultivable areas makes it difficult to
maintain organic purity in the soil and atmosphere.
Moreover, the organic farmers are scattered all over the
. Research Scholar Department of Rural Marketing Management, College Of Co-operation Banking and Management
. Associate professor, Department of Rural Marketing Management, College Of Co-operation Banking and Management
Special Issue
November 2015
Page 49
state with a few pursuing it seriously. While it has been
proven beyond doubt that the organically grown food is
much better in quality, it remains to be established that,
in terms of total productivity and economic viability,
organic farming can compare with modern intensive
agriculture.
Organic farming in Kerala is mostly in traditional stage,
but there is a distinct movement among the farmers as
well agriculture experts and scientists in favors of
ecological farming. Advocates of less chemical more
natural are on the increase. There is considerable
consumer awareness about the dangers of pesticide
poisoning and hybrid crops and fertilizers residues in
food. Farmers are finding it profitable to return to
traditional farming.
Organic farming has been systematically followed on a
large scale in the developed countries. Unfortunately in
India though there is a potential for adopting organic
farming system it is not taking place on a large scale
due to various factors. There are consumers who are
eager to pay premium price for organically produced
commodities even in India. If India taps the potential in
the area of organically produced vegetables, which will
bring huge export earnings. But the farmers should more
focus on organic vegetable farming and to produce
certified organic vegetable.
So these situations are main hindrance to the organic
farming and a healthy world. So the attitude of consumers
is helped to analyze the present situation of organic
vegetable farming.
The important objective of the study was
To examine the consumer’s behaviour towards organic
vegetables
Methodology
Selection of consumers
Twenty consumers from each selected blocks like
Pazhayanoor, Elevenchery and Muvattupuzha of Thrissur,
Palakkad and Ernakulum district respectively through
simple random sampling. Thus the total sample of
consumers confined to 60.
Data collection
Primary data were collected through pre-tested
structured interview schedule from the consumers. Liker
Scale of summated rating was used to analyse the
behaviour of consumers towards organic vegetables.
Data Analysis
For the purpose of analysis of the objective the following
variables were selected.
Special Issue
1.
2.
3.
4.
Socio-economic profile of consumers
Attributes that influence purchase of vegetables
Consumer attitude
Level of consumer satisfaction
Socio-Economic profile of consumers
Study revealed that majority of the respondents (60
percent) was male. Most of the respondents (30 percent)
were in the age group of 50-60 years. Regarding the
educational level of respondents most of the respondents
were qualified up to 12 th standard. 96.67 percent
respondents were living in nuclear family. The most of
the respondents (46.67) were private employees. The
majority of the respondents (71.67 percent) were earning
income between Rs 20000-30000 monthly.
Attributes that influence the purchase of vegetables
Among the attributes were asked all the respondents
irrespective of regions were opinioned that price and
hygiene (100 percent) are the important attributes which
they are looking for while purchasing the vegetables.
This shows that consumers are both price conscious
and health conscious.
Consumers are looking into the freshness (88.33 percent)
and nutrient value of vegetables. Chemical and pesticide
free vegetables are also an attribute consumers are
looking for. It can infer from the above analysis that
enough potential for organically cultivated vegetables.
Consumer attitude towards organic vegetables
Consumer attitude is a composite of a consumer’s
beliefs, feelings and behavioral intentions towards some
object. Understanding consumer attitude towards
organic vegetable can help the producers to take
decisions on organic vegetable farming and even organic
farmer can determine the market potential of their
vegetables. For this purpose different statements related
to organic vegetables were selected and data collected
on 5 point scale of Likert summated rating. An attitude
index was constructed by giving weight ages of 5 points
from 5 to 1 (highly favorable and highly unfavorable). For
the purpose of interpretation index score was rated as
follows.
Less than 30- Highly unfavorable (HUF)
30-50
- Moderately Unfavorable (MUF)
50-70
- Indifferent (I)
70-90
- Moderately Favorable (MF)
90 and above - Highly favorable (HF)
Consumer attitude about the organic vegetables is given
in the table 5.1
November 2015
Page 50
Table - 1 : Consumer attitude towards organic vegetables
Source: Primary data
(HF-Highly Favorable. MF- Moderately Favorable, I-Indifferent, MUF-Moderately Unfavorable, HF- Highly Unfavorable)
All the respondents highly favored that organic vegetables are good quality vegetables. They opined that it is more
nutritious and chemical free. Consumers have moderately favorable attitude towards shelf life of organic vegetables,
nutrient value, environmental friendliness and chemical free nature of the organic vegetables. However, they were
having an indifferent attitude for affordability and availability of organic vegetables. They were moderately unflavored
towards the source of information of organic vegetables. They opined that information regarding organic vegetable is
not adequate. Consumers showed highly unfavorable attitude towards the price of organic vegetables. They opined
that price of organic vegetables are more than inorganic vegetables and it is not affordable for common men.
Table - 2 : Level of consumer satisfaction towards organic vegetables
Statements
Thrissur
Palakkad
Ernakulum
Total (n=60)
Rating of index
Score
Index
Score
Index
Score
Index
Score
Index
Price
40
40
56
56
52
52
148
49.3
DS
Taste
80
80
80
80
80
80
240
80
MS
Nutrient value
80
80
80
80
80
80
240
80
MS
Freshness
70
70
80
80
66
66
216
72
MS
Shelf life
100
100
80
80
80
80
260
86.67
MS
Availability of vegetables
34
34
60
60
46
46
140
46.67
MDS
Marketing channels
40
40
56
56
40
40
136
45.33
MDS
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November 2015
Page 51
Eco -friendliness
80
80
64
64
60
60
210
70
MS
Hygiene
80
80
74
74
48
48
202
67.33
MS
Source of information
76
76
66
66
68
68
210
70
MS
Authenticity of organic nature
44
44
56
56
58
58
158
52.67
R
It gives value for money
100
100
80
80
80
80
260
86.67
MS
Composite index
844
70.33
67.78
R
832
69.33
764
63.67
2440
(HS-Highly Satisfied, MS-Moderately Satisfied, R-Resigned, MDS-Moderately Dissatisfied, HDS-Highly Dissatisfied)
Table 2 reveals that consumers were not highly satisfied with any of the feature of the organic vegetables and they
were moderately satisfied with taste, nutrient value, freshness, shelf life and that organic vegetable gives value for
money. Organic vegetables are tasty vegetables and it contains nutrient value and it is fresh vegetable. Shelf life of
the organic vegetables is more when compared to inorganic vegetables. Source of information and eco friendliness
are also moderately satisfied by the consumers. Consumers are resigned to hygiene and authenticity of organic
nature of vegetables. Consumers were moderately dissatisfied with price, availability and marketing channels of the
vegetables.
Conclusion
It could be concluded that consumer behavior towards organic vegetables shows a preference for consuming organic
vegetables. Consumers are aware about the advantages of organic vegetables and adverse effects of inorganic
vegetables. They prefer organic vegetables as they are health conscious but the high price of organic vegetables is
discouraging them from the purchase of organic vegetables. Attitude and satisfaction level of consumers towards
organic vegetables shows significant difference among consumers. Strategies for marketing the organic vegetables
have to be formulated with exclusive outlets for organically grown crops so as to increase their trust in the labeled
organic vegetables.
Special Issue
November 2015
Page 52
A STUDY OF DEMOGRAPHIC VARIABLES AND THEIR IMPACT ON
WORK LIFE BALANCE PRACTICES
Dolan Champa Banerjee1
Abstract
“The key is not to prioritize what’s on your schedule, but to schedule your priorities” said by Stephen Covey.
Women have made vast improvements in the past few decades and are still proving themselves by holding respectable
positions in the society. Scheduling priorities is a very tough job for working women because they have to balance
both sides of the coin with ultimate care. Here the objectives of this study are 1) to focus on various demographic
variables and 2) to focus on various challenges women face when balancing their work and life 3) impact of
demographic variables on work life balance practices. Balance is not something one find but it is something one can
create so that wheels of life roll and move properly without any difficulties.
Recently we find a significant increase in the number of female professors in different colleges. A test study is
conducted on women professor of a particular college to find the above mentioned objectives. The sample size may
be inadequate but sufficient to establish trends of the balancing since the plight of the working women, their struggles
and achievements are not significantly different in different regions. Some significant facts have been observed from
the study.
Demographical factors like Age, Educational achievement, Designation, Income, Number of Dependents, Marital
Status and Total number of years of experience are highlighted to know their impact on the Work Life Balance
Practices (WLBP).
Key words: Demographic factors, Work life practices, Women employees
Introduction
“The key is not to prioritize what’s on your schedule,
but to schedule your priorities” said by Stephen Covey
an American educator, author, businessman, and
keynote speaker.
Demography is the statistical study of populations. In
this paper the study of population is only restricted to
women faculties from two engineering colleges based in
Mangalore. Here I will try to analyze the respondent by
their age, religion, highest qualification, designation,
income, and personal status, number of years of
experience, total number of kids and total number of
family members.
Women in India have made vast improvements in the
past few decades and are still proving themselves by
holding respectable positions in the society. Scheduling
priorities is a very tough job for working women because
they have to balance both sides of the coin with ultimate
care. Balance is not something one find but it is
something one can create so that wheels of life roll and
move properly without any difficulties.
Work life balance prevails in all categories of people right
from age group of 8 to 80 irrespective of men and women.
WLBP varies from individual to individuals and it also
1
varies from women to women. Both external and internal
environmental factors are responsible for Work Life
Balance Practices (WLBP). For working women in joint
family balancing practices would vary from working
women in a nuclear family. The spouse of the working
women also is a factor which influence work life balance
practices and so on. On the other hand, different work
culture such as too much work load, dominating boss
etc. also leads to different types of WLBP.
Literature Review
DiNatale & Boraas (2002) in their study focuses on 25
to 34 year old women are more likely than women of
other ages to opt for flexibility in their jobs. This is possibly
attributed to the responsibilities associated with
dependant care in this age group as women need time
for the young ones at home. Though child care facilities
are available, women still depend on friends and family
rather than paid-help to take care of their kids.
Lavanya L, Dr. N. Thangavel in their study brought out
that flexi working should be made available in all
organizations as a compulsory policy, to facilitate women
employees to take care of their personal responsibility
and also, enhance their professional life. The policies
such as these, if made mandatory would benefit the
. St. Agnes College (Autonomous)
Special Issue
November 2015
Page 53
employees at large and help in the retention of women
employees. Many IT companies have pioneered innovative
policies with the recent being Accenture’s leave pooling
policy. The other companies should work out on the
model feasible for them and drive their company towards
engaged workforce, which, in turn would create a
successful organization.
Objectives
1) To find out whether work life balance practices differ
with age.
2) To focus on various challenges women face when
balancing their work and life.
3) To focus on impact of demographic variables on work
life balance practices.
Methodology
To meet the objectives of this study, a questionnaire
was prepared and was passed on to the respondent
(women professor) for their valuable response in two
engineering colleges in Mangalore to find out the trend
of the above mentioned objectives. The sample size may
be inadequate but sufficient to establish trends of the
balancing since the plight of the working women, their
struggles and achievements are not significantly different
in different regions. Some significant facts have been
observed from the study.
This research paper is also based on secondary data
for finalization of views and opinions which has been
sourced from some printed literature, journals, published
documents etc.
Concept of Demography
Demography is the statistical study of populations.
Society comprise of both female and male sects. Years
ago male were the only bread earners of the family and
female were more of a home- maker, where they used to
look after their homes as well as their children. Today
the situation is totally different. Women in India now
participate fully in areas such as education, sports,
politics, media, art, culture, service sectors, science,
technology and what not, along with managing their
house hold work. Recently we found a significant increase
in the number of female professors in different colleges
(arts, science, commerce and also technical and
engineering streams). Here I am focusing on engineering
colleges’ female professor to analyze my title.
In this study the demographical factors like age,
educational achievement; designation, income, marital
status and total number of years of experience both
corporate as well as academic, total number of kids and
total number of family members are highlighted to know
their impact on the Work Life Balance Practices
(WLBP).
Special Issue
Whether Work Life Practices Differs With Age?
Women in different age group deals with work life balance
differently. Before marriages the perception of the women
are different again after marriage the insight is different
and of course after kids the acuity of women changes
immensely. Here we have seen different phases in a
women’s life. All these phases are well associated with
the term called Work Life balance.
DiNatale & Boraas (2002) analyzed that 25 to 34 year
old women are more likely than women of other ages to
opt for flexibility in their jobs. They also explained that
this is possibly attributed to the responsibilities
associated with dependent care in this age group as
women need time for the young ones at home.
With this explanation two assumptions can be drawn
i.e. in one hand married women in this prescribed age
group have to manage their kids and on the other hand
un-married women in the same age group want flexibility
in their job because they are committed to their parents
or relatives. In a nutshell we can say that women in this
age group are more committed and are more responsible
for their respective doings and hence they opt for
flexibility. Hence if the employees are not happy with
flexibility in their present job they quit and search for
different working environment where flexibility persists.
A survey reveals in TOI that 50% of the total respondent
(male and female) in India mentioned that they have
changed their jobs in the last six month from March to
August 2015 and this trend is really high within the age
group of 25-34 years. Almost 64% of the survey
respondents who fell within this age group mentioned
the same, followed by 49% from 18-24 years age group.
He also focused that “child care facilities are available;
women still depend on friends and family rather than
paid-help to take care of their kids”. But today’s after 13
years the scenario have changed. Most of the household
are nuclear families. They have to manage everything
by themselves. Parents and in-laws have other
commitments towards their other kids, friends, society
at large etc. and hence they sometimes come, stay
and go. In this type of situation couples think and
proceeds towards crèche or keeping children with maids.
Number of crèche in each locality is increasing day by
day. Hence women keeping their children in crèche do
go with different work life balance practices rather than
who keep their children at homes.
A survey reveals that women with young children at home
are most likely to report high levels of negative spillover,
in contrast to mothers of older children because working
mommies are always around them and try to come out
of their petty problems each hour. Mothers of older
children are little free as compared to mothers of young
ones. Here in each situation the work life balance
November 2015
Page 54
practices are different and the concept also differs with
age.
Working Women Faculties And Their Balancing Act
Recently we found a significant increase in the number
of female professors in different colleges. A survey was
conducted on women professor in two different
engineering colleges to find the above mentioned
objectives. The sample size may be inadequate but
sufficient to establish trends of the balancing since the
plight of the working women, their struggles and
achievements are not significantly different in different
regions. Some significant facts have been observed from
the study.
Both men and women have to balance their work and
family and sometimes crossover aspect comes up.
Professor Mina Westman (2009) in an interview with
Paula Brough and Thomas Kalliath (guest editors),
clarifies the nature of two related constructs: Work-life
balance and crossover. Work-life balance is the
perception that work and non-work activities are
compatible and promote growth in accordance with an
individual’s current life priorities. Crossover focuses on
how stress experienced by the individual influences strain
experienced by the individual’s spouse or team member.
In this expert commentary, Professor Westman discusses
the philosophical underpinnings of work-life balance, the
significance of crossover of emotions and experiences
for organizations and individuals, current advances in
the field and sets out the new directions for this research.
Challenges are part and parcel in everybody’s life. It is
very much pervasive in nature. But the intensity of
challenges varies from person to person and from
situation to situation. Working women too face various
types of challenges as they have to deal with both their
family life and professional work gingerly. In the present
scenario demographics are changing in terms of families
(joint families including parents, nuclear families with
kids, nuclear families without kids), in terms of work
place culture, in terms of social activities, in terms of
finances i.e. double income group. Hence by observation
the various challenges faced by working women faculties
in engineering colleges are as follows.
At workplace
• Dealing with the student
• Dealing with superiors
• Completing portions
• Time management in completing various assignments
• Setting standards in front of students
• Dealings with various meeting
At home
• Managing spouse
• Managing children with their work and studies
Special Issue
•
Managing house hold errands (chores)
Managing guests
• Managing finances etc.
Apart from all these, physical health is the other
challenge which is very important and has to be nurtured
gingerly so that harmonizing act of work and life can be
done. Women come up with many roles from home
makers to the supporting their families monetarily. In
doing so, many times they neglect their health which
becomes a hindrance for both their professional and
personal life. Now-days we hear a lot of problems like
anemia, osteoporosis, heart problem this all arise
because of negligence. Hence if it is dealt cautiously
then working women faculties can balance their
professional lives with their family, career, health and
relatives and friends.
•
Sometimes while balancing, things get overlapped and
many things we have to do in odd times. In a survey
dealt by TOI shows that 69% of the respondents (both
male and female) sometimes deal with their private
matters during working hours but male respondents’
trends are little higher (70%) than the female respondents
(67%).
Data Collection and Analysis
A sample size of 31 working women faculties were
collected from Sridevi Institute of Technology, Kenjar and
Karavali Institute of Technology, Neermarga in Mangalore.
Both the colleges have different engineering
specialization like Computer Science and Engineering,
Mechanical Engineering, Information Science and
Engineering, Electronics and Communication
Engineering, Civil Engineering, M- Tech Programs etc.
Both the colleges are affiliated to VTU Belgaum and
recognized by AICTE New Delhi.
1. A structured questionnaire was prepared and given
to faculties who were my respondents in this
research paper. Name of the respondent which was
an optional criteria.
2. After the survey it was found that the trend in
engineering colleges today is to hire faculties within
the age group of 24 to 30. Out of 31 faculties, 90.32%
of women faculties were within the age limit of 30,
and 9.68% of women were in the age limit between
31 years to 40 years.
3. Out of 31 working women faculties, 90.32% of
faculties were Hindus and 9.68% of faculties were
Christian.
4. Out of 31 faculties, based on qualification, data
available were 29.03% are BE, 6.45% are MPhil,
3.22% are Ph.D, and other which includes M.Tech
etc. were 61.30%.
November 2015
Page 55
5. 100% engineering faculties are designated as
Assistant Professors irrespective of the number of
years of experience which include both corporate
experience and academic experience.
6. 96.78% of teaching employees in the selected
engineering colleges earn less than 40,000 and
3.22% earn more than 40,000.
7. 41.93% working women faculties were married and
58.07% were single in terms of status and none of
the faculties were divorced.
8. In terms of experience both corporate and academic,
12.90% responded that they have no corporate
experience at all, 16.12% responded that they have
less than one year experience, 61.30% responded
that they have 2 to 5 years of experience and 9.68%
responded that they have more than six years of
experience.
9. 32.26% responded that they do not have any
academic experience at all, 6.46% had less than 1
year of academic experience, 29.03% had 1 to 3
years of experience and 32.25% had 4 to 8 years of
experience. Hence here I can find out that 38.72%
are without proper experience but teaching in
engineering colleges.
10. Out of the total respondent , 87.10% do not have
kids which include 58.07% who are single that is
they are not married and 12.90% who are married
but do not have children and 16.12% who are married
and stays with their in-laws, on the other hand 3.22
% have 2 kids and 9.69% have only 1 kid.
11. Out of the total respondent, those who are single
none stay alone but 58.07% stays with their parents
or family members. Out of the married category total
number of family members varies from family to
family. Out of the total respondent 12.90% are
married and stays with their husband only. 16.12%
of working women in engineering colleges stays with
their husband and in-laws. 3.22 % are married and
stays with their kids and a 9.69% respondent are
married and stays with their children and in-laws or
parents. But the striking factor is 3 families have
more than 9 members in the family i.e. these families
are called joint families.
Findings and Interpretation
Finding by Survey
• Women faculties in the selected Engineering colleges
are vibrant, energetic and youngsters within the age
group of 24-30 years of age. Hence it can be
interpreted that they do not have adequate experience
in teaching. So they have to thoroughly prepare
themselves for class and hence work life balance
practices of these working professors differ with age.
Special Issue
•
•
•
•
•
•
•
Most of the women faculties have M.tech as their
qualification followed by BE, and then MPhil and least
Ph.D’s. But most of them have the desire to go with
doctoral degree. In- spite of this 96.78% of teaching
employees in the targeted engineering colleges earn
less than 40,000 and 3.22% only earn more than
40,000.
100% engineering faculties are designated as
Assistant Professors irrespective of the number of
years of experience which include both corporate
experience and academic experience. So it is clear
that through the women faculties are in the age group
of 24-30 years they are all designated as Assistant
professors.
Approximately 30% of the faculties either do not have
experience at all or less than 1 year experience. 61.30%
responded that they have 2 to 5 years of experience
and 9.68% responded that they have more than six
years of experience. Here also I can analyze that
with the number of years of experience and no
experience the work life balance practices would differ.
More than 38.72% are without proper academic
experience at all but teaching in engineering
colleges., 29.03% had 1 to 3 years of experience
and 32.25% had 4 to 8 years of experience. Hence
the work life practices differ with the number of years
of experience.
Out of the total respondents, 87.10% do not have
kids and 12.9% have kids. Out of total number who
do not had kids, 58.07% respondents were single
that is they are not married and 12.90% who are
married but do not have children and 16.12% who
are married and stays with their in-laws and do not
have kids. On the other hand the total number of
respondent who had kids, 3.22 % have 2 kids and
9.69% have only 1 kid.
Out of the total respondent, those who are single
none stay alone but 58.07% stays with their parents
or family members. Out of the married category total
number of family members varies from family to family.
Out of the total respondent 12.90% are married and
stays with their husband only. 16.12% of working
women in engineering colleges stays with their
husband and in-laws. 3.22 % are married and stays
with their kids and a 9.69% respondent are married
and stays with their children and in-laws or parents.
But the striking factor is 3 families have more than 9
members in the family i.e. these families are joint
families. Here also with number of members in a
family the work life balance practices will vary.
Out of the total respondents, 58.07% are not married
and 41.93% are married and hence here also work
life balance practices would differ from marital status
to status.
November 2015
Page 56
Findings done earlier
Centre for Work-Life Policy (2001), conducted a survey
and found out that 40% of the highly qualified women
with spouses felt that their husbands create more work
around the house than they perform. It brings out that
women need to have more strategies in place to balance
their work and life, and organizations should bring out
policies to support them.
Kirchmeyer (1992) brought out that employees in the
same organization for a longer period of time, tend to
make use of the WLBPs available in the company to
take of their non-work commitments.
Conclusion
As per Randstad Work monitor Survey Wave 2, 2015,
Work Life Balance continues to be an evolving topic for
India Inc. This topic is important in every one’s life and it
should be gingerly acted on. Harmonizing or balancing
is a tough job. Balance is not something one find but it
is something one can create so that wheels of life rolls
and move properly without any difficulties. Demographic
factors do have an impact on work life balance practices.
Work life balance practices are different for different
individuals and also it differs with age. Sink or swim is
the code word for the situation. To swim we have to
schedule priorities and see both sides are nurtured with
ultimate care.
Special Issue
Bibliography
• Lavanya L, Dr. N. Thangavel (2014), “Work-Life
Balance Practices and Demographic Influence: an
Empirical approach” IOSR Journal of Business and
Management (IOSR-JBM) Volume 16, 104-111
• DiNatale, M., & Boraas, S. (2002), “The labor force
experience of women from „generation X’,” Monthly
Labor Review, 125(3), 3-15.
• Expert commentary on work-life balance and
crossover of emotions and experiences: Theoretical
and practice advancements Author(s): Mina
Westman, Paula Brough and Thomas Kalliath
Source: Journal of Organizational Behavior, Vol. 30,
No. 5, Achieving Work-Family Balance: Theoretical
and Empirical Advancements (JULY 2009), pp. 587595
• Allen (2001), “Family-Supportive Work environments:
the role of organizational perceptions,” Journal of
Vocational Behavior, 58(3) 414-435.
• Centre for Work-Life Policy (2001), as mentioned in
“Off-Ramps and On-Ramps – Keeping talented
women on the road to success,” Sylvia Ann Hewlett
and Carolyn Buck Luce, Harvard Business Review
on Women in Business, Harvard Business School
Publishing Corporation 2005
• Kirchmeyer C (1992), “Perceptions of network-to-work
spill over: Challenging the common view of conflictridden domain relationships,” Basic and Applied
Social Psychology, 13(2),231-249
November 2015
Page 57
IMPACT OF MOBILE TELPHONY IN RURAL INDIA
Dr. A. Kumudha1
C.R. Shiv Kumaran2
Abstract
Connectivity for long was a problem in India. Right from the 1850s when the telegraph services were launched in the
country, until the late 1990s India has always grappled with the problem of finding a way to establish two-way
connectivity amongst its populace. Two-way connectivity essentially meant a civilian mechanism wherein a message
sent across could be received and responded to back by the recipient. This was essentially possible only through a
telephone and of course at a later date the internet. However the expansion of telephone lines in India happened at
a slower pace until the advent of the mobile telephone. Much has changed in India from the year 1995 when the first
mobile call was made until now because of this development. This paper aims to highlight the potential benefits of the
mobile telephone in the rural areas of the country.
Key words: Rural India, connectivity, mobile telephone
Objectives
The rapid expansion of mobile telephony and along with
it the ability to access internet presents the Government
and the policy makers with a strong platform through
which interactive last mile connectivity can be achieved.
Mobile connectivity enables two way communications
that makes it possible for people to get connected
irrespective of the distance and the geography. This enables
accessibility to various stakeholders of our society to
take various services commercial and social to people
who live even in the remote rural areas of the country.
The main objective of this paper is to identify the benefits
that will accrue to rural India because of the ability of
the mobile networks to reach remotely placed people.
However with the advent of technology communication
started to speed up. Telecommunication was the modern
term that was made use of to describe the ability to
communicate seamlessly over a long distance. The
history of modern telecommunication in India started with
the advent of telegram. In the year 1850, an experimental
telegraph line was installed between Kolkata and
Diamond Harbour by the British East India Company.
Later in the year 1853 construction of about 6,400
kilometres of telegraph lines was started. In the year
1882 the first telephone exchange was started in Kolkata
and later this facility was extended to other major
metropolitan cities of the country. Slowly but steadily a
major
Data Collection
This paper makes use of information available publicly
on World Wide Web.
geography of the country was brought under the ambit
of fixed land line connectivity. However the progress in
achieving tele-density; that is coverage per 1,000
numbers of the population was very minimal and as such
a majority of the population was still left out of the scope
of tele-communication. The late 1980s and early 1990s
saw the advent of STD/ISD booths spring up all across
the rural landscape. Parallel to the development of the
fixed landline telephone development, the development
and spread of Radio and Telephone networks also
happened in India.
History of Connectivity in India
It is a natural tendency amongst humans to
communicate with one another. Speaking a language or
even gesturing is a medium that is used to communicate
one’s thoughts to another. A new-born baby cries to
communicate to its mother that it is hungry. The need
for communication amongst humans is as basic as that.
With the development of technology humans were able
to communicate across the distance.
Writing letters, sending a courier man with a message
or sending a dove with a message scroll were all
methods that have been used from time immemorial by
humans to communicate across the distance. However
all these methods took time and getting a feedback from
the recipient was also too time consuming.
1
2
However all of this were only basic voice based
communication tools that were available only to a few
and were strictly one-way communication tools that
people used only when they needed it. Perhaps until
the mid-1990s India did not have a communication tool
which was always on, in the hands of its subscriber and
enabled a real-time two way communication.
. Dr. Kumudha. A , Associate Professor, PSGR Krishnammal College for (W), Peelamedu, Coimbatore.
. Shiv Kumaran C R, Research Scholar, PSGR Krishnammal College for (W), Peelamedu, Coimbatore.
Special Issue
November 2015
Page 58
In the year 1995, the first mobile telephone service on a
commercial basis was made in India and in the same
year internet services were also introduced in India. The
mobile technology had the potential to free the telecom
operators from the hassle of establishing last mile
connectivity, it helped subscribers to have a personal
communication tool that could be carried across and
was always on. For the first time in the history of India
here was a tool that was personal, mobile and provided
an opportunity for a two way voice communication. But
the real utility of the mobile telephony lay not in its ability
to carry voice communication but in its ability to carry
information as text or otherwise to the subscriber. This
is commonly known as data connectivity. Starting from
the late 1990s this ability would morph into value added
services that put in the hands of the various stakeholders
the ability to reach out with vital information that would
make the lives and work of people more meaningful and
productive.
Growth of Connectivity in India
It would be safe to say that India missed the bus in the
global fixed land line phone connection revolution. But
whatever ground that the country lost earlier has now
been more than made with mobile phone connectivity.
As per the statistics of the Telecom Regulatory Authority
of India, the total telephone subscribers’ count in India
is as follows:
Table - 1
Particulars
Mobile
Fixed
Total
Total Subscribers
(Million)
980.81
26.15 1,006.96
Urban Telephone
Subscribers (Million)
562.95
21.25
584.21
Rural Telephone
Subscribers (Million)
417.85
4.90
422.75
Overall Tele-Density
77.90
2.08
79.98
Urban Tele-Density
144.25
5.45
149.70
48.10
0.56
48.66
Share of Urban
Subscribers
57.40%
81.27%
58.02%
Share of Rural
Subscribers
42.60%
18.73%
41.98%
93.15
15.70
108.85
Rural Tele-Density
Broadband Subscribers
(Million)
Source: TRAI Press Release, No. 47/2015, dated 1st September,
2015
It is clearly evident from the last but one row of the table
that the mobile phone services have made a big time
entry into the rural areas of our country. About 42.60%
of the rural population seems to be covered by mobile
Special Issue
telephony and this figure is on the increase month on
month. All of this means that more of the rural population
is having access to mobile phones and this makes this
medium a preferred medium of two way communication.
Today the mobile revolution in India is in the next phase
with the advent of smart phones, which is a mobile phone
that performs many of the functions of a computer,
typically having a touch screen interface, internet access,
and an operating system that supports operation of
various programmes aimed at retrieval and exchange of
specialised data. Statistics show that India is now a worldleader in Smartphone growth. The advent of smart phones
below the USD100 level has led to a virtual explosion of
growth in users of smart phones across the country.
Services that were available only on computers are now
being increasingly being accessed through the smart
phones and in that way it is correct to state that India
has leapfrogged into this technology to access the
internet from the basic mobile phones without having
gone through the usual route of computers to tablets to
smart phones.
According to the report by Mary Meeker titled, India on
the Go – Mobile Internet Vision Report, 2015, 2G
technologies will dominate the internet scene in rural
India, while the urban areas will adopt 3G and 4G
technologies. However over the years, 3G will enter rural
India and this will have a profound impact on the economy
of rural India. Already as of June 2014, nearly 50% of the
Active Internet Users in rural areas accessed internet
using mobile phones, community service centres and
cyber cafes. Of this nearly 38% of all rural India users
have used the mobile phone to access the internet. It is
notable that in India, there are more number of people
owning smart phones than those that own computers.
So increasingly internet penetration in India will happen
through the mobile phones.
The growth of smart phones in India will increase as
their prices keep dropping by the day. Smartphone are
typically used to order goods, read news, monitor crop
growth, access government services, report law and
order, manage health, the list goes on. Also the smart
phones have the ability to support multiple languages
which makes them an attractive tool of use in India’s
hinterland. This development has the ability to transform
a country of one billion people by getting them connected
and enabling an equal access to information and services.
How Mobile Telephony will help to transform Rural
India
With over two-thirds of India’s population residing in the
rural areas, an effort as soon as possible is needed to
improve India’s standard of living. Indian rural population
is challenged by illiteracy, lower levels of health care,
quasi-employment and other issues that inhibit
November 2015
Page 59
development. Mobile telephony has started to penetrate
into rural India, however for any real change to happen
in rural areas data connectivity needs to get popular.
The TRAI statistics stated above indicate that this trend
is picking up recently both in urban and rural India. As
mobile technology can be used to tackle the problem of
illiteracy, it will certainly have a cascading effect on the
economic development of rural India. Now let us look at
some of the benefits that mobile/Smartphone telephony
will usher into rural India. These benefits are spread
across the various sectors like farming, health, education,
financial security etc.
Information inputs for farming
About 60% of the farmed land in India is dependent on
monsoonal rains. This means that farmers should always
be in the know regarding the rainfall forecast and patterns
in the monsoon season. In fact, monsoon forecast
information on a real-time basis will help farmers in
choosing the crop that they want to cultivate during the
season. While radio broadcasts provide weather
information on a periodic basis, the information so
provided is not on a real time basis. On the other hand
there are various applications specially developed for this
purpose that provide information on rainfall in a particular
radius. This information then helps the farmers to choose
the kind of crops that they want to sow that season and
the farm practices that needs to be followed. This in
turn would lead to decisions needed to be taken regarding
the seeds, fertilizers/nutrients, pesticides to be used
and timely activities needed to upkeep the crop. All of
this information can reach the farmer through the mobile
phone. Also agriculture department officials can
continuously receive feedback from farmers on the latest
developments on ground and suitably advise the farmers
on what needs to be done. This has the effect of enabling
the concerned officials in covering a larger acreage of
crops than it would be possible if they were to physically
visit the farms. Also information on pest attack
experienced elsewhere can immediately be made
available such that other farmers can immediately act
upon it. The advantage of having smart phones is that
audio-visual exchange of information is possible. For
example, specialized WhatsApp groups can be formed
area-wise and relevant information can then be shared
in that group.
known or does not reach the farmers and they are then
forced to dispatch their products at the last known price.
Also without any formal structure for information
dissemination, certain agro-markets continue to receive
products despite a supply glut thereby depressing prices
further, while other markets just kilometers away might
be offering better prices. Marketing challenge is a very
big problem faced by small farmers who are then
exposed to exploitation by middlemen who offer them
poor prices. This in turn affects the ability of the farmers
to earn a higher income.
In a mobile enabled environment, the farmer typically
sends information on the crop yield and the price that
he or she is expecting or in the other way around receives
information on the prevailing market prices in various
markets across the geography he or she is based in.
The information received in response to the query enables
the farmer to take a better decision. The market price
information system in fact has successfully been
introduced in a number of countries across the world. It
is a system wherein a farmer receives a text message
containing information on latest market prices on a daily
basis. This enables the farmer to take an informed
decision. Better still small farmers can group themselves
and consolidate their produce in order to offer the same
to big buyers or exporters. This can ensure economies
of scale and better price realization for the produce. What
applies for agriculture will also apply in equal measure
to other farm products like milk, meat, fish, honey, crafts
etc.
Thus mobile telephony and the related technology have
the profound effect of increasing rural household income.
Access to financial products like agro-insurance
Mobile phones can be used to distribute agriculture
insurance to farmers. Majority of the farmers in India do
not insure their crop against price fluctuations or weather
related damages and this often leads to a complete loss
of crop and complete financial distress to the farmer. As
the financial markets evolve, new insurance products
targeting the rural farmer can be made available. The
mobile telephone platform enables the insurance
companies to have a better reach to farmers and for the
farmers it becomes easier to subscribe to insurance
policies and make claims if any thereof.
All of this has the effect of increasing farm-productivity
in rural areas.
This has the effect of safe-guarding the income potential
of rural India.
Better pricing for agro-products/rural farm based
products
In the traditional way of selling agro products, farmers
get information about market price for their products from
friends, relatives, middlemen through the word of mouth.
Many a times the information on change in prices is not
Access to formal banking
One of the major areas of influence that mobile telephony
can have on the financial landscape of rural India is by
taking across the formal banking practices to the
doorstep. For long, income earned in rural India was
either stored as cash or gold or was lent to the
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November 2015
Page 60
unorganized sector for receipt of monthly interest
payments. This practice exposed wealth to the danger
of it being lost, stolen or destroyed. However the advent
of mobile telephony and the recent decisional the
government wherein the concept of direct cash transfer
of welfare payments to bank accounts of beneficiaries
has brought millions of people in rural India under the
ambit of formal banking. Exposure to formal banking
enables people to build a secure financial future for them
as money in the bank grows with interest and withdrawals
happen only based on need. The funds so accumulated
in the banks can also be used by the government as
collateral for any future loan required. The recent decision
of the Reserve Bank of India to allow the commencement
of operations of Payment Banks also has the effect of
taking Banking service to the doorstep of rural India.
People who hitherto did not have access to a bank
branch can now safely and securely from the comfort of
their homes can send or receive money or maintain a
savings account with a payment bank. Mobile telephony
is being increasingly looked upon by the government as
a tool to ensure the success of its Financial Inclusion
scheme namely the Pradhan Mantri Jan Dhan Scheme.
Increasingly banks in India are getting interested in
reaching unbanked customers through mobile phone
banking channel, as they believe that this method will
be less costly in servicing a customer when compared
to operation of physical branches. On the other hand
network operators see mobile commerce and payments
applications as a service that can generate more revenue
on an existing mobile network infrastructure. Mobile
phones can be used for financial services in three different
ways, for micropayments, for transfer of money and as
a banking conduit.
Extension of Health Services
One of the major advantage of mobile telephony is that
can extend organized health care services in rural areas.
No longer will there be a need for a doctor/paramedical
staff to visit villages or for the villager to visit the doctors
in nearby towns. Once the diagnosis and treatment for
an ailment has been identified, mobile phones can be
made use of to communicate with the patient reminding
them about the check-ups to be undertaken, medicine
routine, vaccination, questions relating to health condition
can be answered, in fact visuals of a health condition
can be sent across and the possibilities are limitless.
Through mobile telephony organized health care can be
extended to the needy. Queries or instructions relating
to nutrition and child care can be shared to women who
may otherwise be hesitant to go to clinics for
consultations. Such queries can be answered by women
medical professionals to rural women who make the calls
from the privacy of their homes.
Special Issue
Simply put mobile phones can completely transform the
way healthcare is delivered and availed in rural areas of
our country.
Empowering people through basic education
Increasingly mobile applications are being built to spread
education in rural areas. With the spread of smart phones
in rural areas, it is now possible to spread basic lessons
in language and mathematics than can be learnt by the
recipient through the instructional form or
demonstrational form of education. Mobiles can also
supposedly facilitate knowledge-center learning by
providing efficient and inventive methods by which
students can learn with understanding – meaning that
they deepen their understanding of a specific subject
matter rather than merely memorizing large amounts of
information – and then use this knowledge as a basis
for new learning through integration and interconnection.
The main advantage of the smart phone is that it has a
visual based approach wherein the phone user can see
the icons on the screen and navigate. The literacy
standing of the user does not matter in here to use or
navigate the phone using visual icons. Now this same
concept can be made use of to increase literacy in rural
areas by imparting lessons in language skills or to build
simple mathematical skills. Besides such formal
education mobile phones soon become a tool for gaining
further knowledge in any area and often become a lifelong companion to the user in disseminating further
knowledge. Mobile phones along with related
applications can become virtual libraries from which
knowledge dissemination can happen whenever there is
a need.
Information can also be transmitted through the mobile
phones about any skill development program or a
training that is happening in a neighboring area. Mobile
phones themselves can become a tool through which
people can enroll themselves in such training programs.
Also often in rural areas, the youth fail to avail the right
job opportunities due to lack of information and
awareness. As the majority of the young population has
access to mobile phones a SMS based tool to notify of
the job opportunities available will go a long way in
reducing the problem of unemployment or under
employment in rural areas.
Maintenance of Law and order
Mobile phones form the perfect platform for dissemination
of information concerning law and order in any area. Any
untoward incident happening even in the remotest
corners of the country can now immediately be reported
to the concerned authorities for remedial action. In fact
there are special applications that are now available to
report instances like child marriage, domestic violence,
burglary and other such crimes. This mechanism enables
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Page 61
the government to exercise its writ effectively and
efficiently across the country and render justice to the
population. Before the advent of mobile phones,
information took time to reach the nearest police station
and by the time it reached, it was often biased. But with
mobile phones making communication instantaneous
all such problems are eliminated completely.
Thus mobile phones enable better law and order in rural
areas and thereby ensure prevalence of social order even
in far flung areas of the country.
Conclusion:
We can observe that the mobile phones (now morphing
into hand-held computers) hold the potential to offer
unrivalled last mile connectivity to rural areas. The major
allure of the mobile phones is their ability to not only
carry voice data but also usher in data connectivity, which
Special Issue
enables various stakeholders to reach hitherto
unreachable communities and provide them with various
services that will bring about their uplift and development.
Given the various advantages as discussed above, India
is on the threshold of a mobile revolution that aims to
make the entire country more vigilant, aware, productive,
educated, healthy and safe place. Mobile phones will
play a very important role in enabling rural communities
to access the internet and get hold of information that
will better their lives.
Reference
• Wikipedia
• Telecom Regulatory Authority of India
India on the Go – Mobile Internet Vision Report, 2015,
Mary Meeker
November 2015
Page 62
OCCUPATIONAL HAZARDS OF WOMEN WORKERS
IN GARMENT SECTOR
Dr. Pankajakshi. R. 1
Prof. Shailaja.M. L.
2
Abstract
The textile industry is one of the India’s oldest industries, among the cotton producing countries of the world India
stood at the first rank for cotton cultivated area & third in production. Apart from agriculture, the second largest
employment provider in the country is the textile industry providing direct employment to over 35 million people. In
the world market share India has the potential to enhance its share in textile & apparel and reach to a US$ 80 billion
by 2020.Women form an integral part of the Indian workforce. Women constitute to the half of the Indian population
and one third of the work force, though both the genders work together but still there are differences compared to
25.63 per cent in 2001. According to Employment and Training department, Bangalore the total employment of
women in organized sector as on 31st March 2012 was 7,64,669 of which 2,90,983 were in public and 4,73,686 were
in private sector for the Total population of 23,47,177. As per Census 2011, the work participation rate for women has
slightly decreased from 25.63% to 25.51%.This conceptual paper basically tries to analyze the working environment
of Women workers in Garment sector, problems and the challenges faced by Women in the garment sector through
the information available from secondary sources and the suggestive measures to be taken by the organizations
related to Garment sector for the betterment of Women Workers:
Key words: Women workers, Garment sector, Challenges, Suggestive measures
Introduction
The textile industry is one of the India’s oldest industries,
India stood at the first rank for cotton cultivated area &
third in production among all cotton producing countries
in the world. Next to China and USA, India is the second
largest producer of silk and seventh largest producer of
wool in the world and being the source of the major
contributor to income, exports, employment and foreign
exchange earnings.
As per Ministry of Textiles, Government of India, the
Indian market size of technical textiles was Rs 63202
crores in the year 2011-12 which has grown from 41756
crore in the year 2007-08 with annual growth of 11%
year on year basis. As per the sub-group on technical
textile for 12th five year plan, it is expected that the
technical textile industry market size will reach Rs.
1,58,540 Crores by the year 2016-17 with a growth rate
of 20% year on year basis
Basic Facts: Indian Textiles and Clothing (T&C) exports
• India’s share in global T&C trade: 4% in textiles and
2.8% in clothing
• India’s rank in world trade: 7th in textiles and 6th in
clothing
• Share in the country’s total exports basket: 12%
• Readymade garments share: nearly 50% of total
textile exports
1
2
•
•
•
India’s textiles products are exported to over 100
countries
Two-third of India’s textiles are exported to the US
and EU
Other major export destinations include Canada,
UAE, Japan, Saudi Arabia, Republic of Korea,
Bangladesh and Turkey.
Source: Ministry of Textiles
Based on the information available through the Data
released by the Apparel Export Promotion Council, the
industry of garment exporters have estimated the exports
of India at $40 billion in 2013 as compared with China’s
$274 billion. Textile refers to everything like fiber, yarn to
fabric, readymade garments made of cotton, silk,
synthetic yarn and wool. In the global trade more than
55% relates to readymade garments in which India
ranked 6th in 2013 with a total exports of $16 billion, which
is 40% of the country’s total textile/garment exports.
The Indian Ready-made Garment Industry had its origin
during World War II focusing on the mass production of
military uniforms. The industry turned to exports in the
year 1969-70. Due to global economic slowdown, the
Indian textile Industry is facing challenges of strong
demand side pressure because of inflationary trends and
volatility in commodity prices.
. Associate Professor, Department of MBA, VTU, Muddenahalli , Chikkaballapur.
. Associate Professor, Department of MBA, Dr. Ambedkar Institute of Technology, Mallathahally, Bangalore.
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November 2015
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Ms. Anupama et.al (2013), has quoted in their paper
that the Readymade Garments Industry is vital to the
economy of the country. The industry has given 6% to
the GDP & has earned 16% of foreign exchange of the
country. It consumes almost 40% of the fabrics
produced in the organized and decentralized sectors
combined of the textile industry and employs around 40
lakhs persons. The top 10 destinations for India’s
readymade garment exports account for nearly 80% of
total readymade garments exports in India. Among the
leading 10 export markets, the US accounts for the
largest chunk; readymade garment exports from India
to the US had the largest share of 25% during the
financial year 2011.
Apart from agriculture, the second largest employment
provider in the country is the textile industry providing
direct employment to over 35 million people. In the world
market share India has the potential to enhance its share
in textile & apparel and reach to a US$ 80 billion by
2020. Indian Textile industry can be categorized as
cotton, silk, woolen, handicrafts, readymade garments
and so on. In developing countries, the Apparel and the
textile industries manufacturing readymade garments
being one of basic needs of the human being have
contributed towards the employment of many in their
industries and women in particular. The garment sector
can be seen as low capital intensive and highly labor
intensive industry. The workers employed are both skilled
and unskilled workers.
Karnataka is considered to be one of the desired location
for setting up industries. To meet the needs and increase
the economic status of the state, it is essential to set
up industries in the state to have progressive outlook.
Karnataka State comprises of large public sector
industrial undertakings, large privately owned industries
like steel, sugar, textiles etc. Karnataka has emerged
as the leader in IT & BT (in specific Bangalore).
Karnataka is considered as knowledge based industrial
sector, making rapid strides in IT & computer related
industries. Apart there are developments taking place in
the field of biotechnology, traditional cottage, Handicrafts,
Handlooms, Power looms, silk weavers, Khadi and so
on.
More than 92% of the working population of the country
belongs to the unorganized sector. The State
Government has constituted the Karnataka State
Unorganized Workers’ Social Security Board in October
2009 and the State Government has also framed the
Unorganized Workers’ Social Security (Karnataka) Rules
in 2009. The State Government has so far identified 39
categories of unorganized workers out of which garment
sector also being part of private unorganized sector. As
Karnataka has large cotton growing belts, and number
Special Issue
of garmenting units, Garment sector has witnessed a
growth in investments in Karnataka State and the
capacity in garmenting has been drastically increasing.
There are approximately 6500 units (Large, Medium and
Small) at organized and unorganized level with a
presence in 20 districts across the State with the
potential for more employment opportunities.
Employment of Women in different sectors
Women form an integral part of the Indian workforce.
Women constitute to the half of the Indian population
and one third of the work force, irrespective of men and
women work together but still there are gender
differences. According to the information provided by the
office of Registrar General & Census Commissioner of
India, As per Census 2011, in India, the total number of
female workers is 149.8 million and rural female workers
are 121.8; urban female workers are 28.0 million. Out
of total 149.8 million female workers, females working
as cultivators are 35.9 million and agricultural laborers’
are 61.5 million. Of the remaining female workers, 8.5
million are in household Industry and 43.7 million are
classified as other workers.
As per Census 2011, the Women Work Participation
rate is 25.51 percent as compared to 25.63 per cent in
2001. The Women Work Participation rate has reduced
marginally in 2011 but there is an improvement from 22.27
per cent in 1991 and 19.67 per cent in 1981. The Women
Work Participation rate in rural areas is 30.02 per cent
as compared to 15.44 per cent in the urban areas.
According to Employment and Training department,
Bangalore the total employment of women in organized
sector as on 31st March 2012 was 7,64,669 of which
2,90,983 were in public and 4,73,686 were in private
sector for the Total population of 23,47,177.
As so far the organized sector is concerned, in March,
2011 women workers constituted 20.5 percent of total
employment in organized sector in the country which is
higher by 0.1 percent as compared to the preceding year.
As per the last Employment Review by Directorate
General of Employment & Training (DGE&T), on 31st
March, 2011, about 59.54 lakh women workers were
employed in the organized sector (Public and Private
Sector). Of this, nearly 32.14 lakh women were
employed in community, social and personal service
sector.
This conceptual paper basically tries to present the
working environment of Women workers in Garment
sector, problems and the challenges faced by Women
in the garment sector through the information available
from secondary sources such as Annual reports,
statistical data from Department of Labor, Department
of Women and Child Development, Government of
Karnataka and Government of India, Relevant reports of
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Page 64
Planning Commission, Economic survey reports and
various other sources.
Sudeshna Saha (2014), the author in their study Women
Employees in Garment Industries, selected industries
in Bangalore has focused on the working condition of
the women in the unorganized garment sector, the issues
relating to the working conditions, the socio-economic
background of the employees, the problems encountered
by the work force and the coverage of the labor laws in
Garment Industries.
Anupama et.al (2013), in their paper focused on the
Innovative HR practices to improve Socio-Economic
conditions of the Garment industry Women Workers
through an Empirical Study. The pilot study indicates
that the companies adopting HR practices have seen a
positive results in terms of better social status, increase
in productivity of employees and decrease in problems
pertaining to IR issues.
S Calvin, B Joseph (2006), the author has tried to
identified the common accidents that occurred in the
garment industries and the factors associated in order
to recommend preventive steps.
Problems and Challenges faced by the women
workers in garment sector:
Based on the available information through secondary
sources, the problems and challenges faced by the
women workers/employees in the garment sector are
discussed below:
Infrastructure Related
• Improper infrastructure facility such as work place
overcrowded, less ventilation, poorly illuminated
rooms.
• Poor canteen facilities, inadequate crèche facilities
and restrooms.
• Inadequate toilets and drinking water facility.
Employment Related
• Extreme work pressure with denial of leave and
absence from the work, the employees has a fear of
losing job.
• There is no job security, as some of the workers are
on contract and not a permanent employee.
• In certain companies the employees are deprived of
benefits such as PF, gratuity, bonus, ESI etc.
• High employee turnover due to minimal pay leads to
stressful work and also due to targets to be achieved.
• At certain situations the employees are asked to work
long (overtime) without any additional remuneration.
• Retrenchment rate is found to be high due to high
supply of casual labour inflow daily.
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•
•
Employee reporting late to work, any minor mistakes
and when the deadlines are not met, then the
employee has a fear of being fired by higher ups.
Most of the industries are located outskirts of the
city when companies do not provide transportation
facility then it becomes difficult for the workers to
reach the company on time.
Health Related
• The employees especially in stitching, cutting,
tailoring section meet with injuries such as needle
piercing, finger injury and so on.
• Reproductive problems are being faced due to sitting
for long hours in a single position without stretching
of legs.
• Health problems such as anaemia, low eye sight,
orthopaedic relate problems.
Gender discrimination and women harassment
• Gender discrimination at work and at times women
workers are deprived in considering for higher
positions.
• Male employees are being given high skill training
and also work during night shifts with extra pay
whereas female employees are denied of the same.
• Certain work places, Women workers are being
harassed verbally, mentally and sexually.
• In some of the organizations the employees have
been asked to sign the contract without even detailing
the contents of the contract.
Policy Related:
• Implementation of Labour laws (Factories Act 1948,
Minimum wages Act, 1948, The Employee State
Insurance Act, Maternity Benefit Act 1961 so on.)
• Delay in addressal of Women workers problems and
the functioning of women grievance cell.
• Follow up of Minimal wages with benefits; irregular
and untimely wages, not good working conditions
and safety measures are not being taken care of.
• Women workers have very little awareness and
information about the rights of the worker and as a
human being.
Suggestive measures to be taken by the
organizations related to Garment sector for the
betterment of Women Workers:
• Proper infrastructure facility has to be provided such
as drinking water, proper ventilation for lighting,
canteen facility with affordable food charges, crèches
facility can be provided for the needy with nominal
charges for the same, rest rooms and overall good
working environment.
November 2015
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•
•
•
•
•
•
•
•
•
•
•
•
Implementation of Labour laws should be followed
such as Factories Act, Minimum wages Act, The
Employee State Insurance Act, PF, Maternity Benefits
and so on.
Change in the mind-set and the attitude through
encouraging Women workers and promoting them
to higher position based on merit without any gender
discrimination can motivate the women workers to
perform even better off and also can create a
competitive spirit.
Presence of Women Grievance Cell (WGC) is
essential to address the problems of the women
workers through a meeting held regularly.
Providing extra pay for the over time workers with
transportation facility, incentives provided based on
the target achieved.
Emphasising on development of skilled manpower
for the use of industry, focusing on the skill upgradation of women workers.
Regular training has to be provided for the women
workers on safety and security measures such as
proper use of Personal Protective Equipment’s –PPE
to avoid accidents.
Frequent medical check-ups and conduction of
recreation programs such as Yoga, meditation
classes to overcome stress and health related
problems of women workers.
Women workers in the garment sector come for poor
background, so there is a need for some sponsorship/
scholarships to encourage the studies of the children
of the workers.
As the Textile and Garment sectors are providing large
employment especially to women, recognizing and
rewarding the best performer can create a competitive
spirit among the women workers.
Regular counselling has to be provided to the women
workers in order to have work life balance.
Conduction of regular awareness programmes about
the rights of the women workers so that the women
workers have information and is in better position to
handle situations at the work place.
Entrepreneurial programmes can be organized for the
women workers to make them more competitive and
face the changing environment.
Conclusion
Women is strength of the family and the nation, Women
form an integral part of the Indian workforce. Women
play a multi skilled role for the economic development
and for the betterment of the society. Women constitute
to the half of the Indian population and one third of the
work force. Indian women have the capability of ruling a
Special Issue
state or can even become the cause for the collapse of
the state. Women workers in the garment sector come
from low education and economically not well off. In
order to encourage and take care of the safety and
security of women workers, the companies need to come
up with suitable measures to meet the challenges of
the women workers faced in garment sector and also for
the women workers to face and sustain the challenges
of the highly competitive environment.
References
• A Brief Report on Textile Industry in India, May 2014,
Corporate Catalyst India, Pvt. Ltd. New Delhi.
• Annual Report, 2012-2013, Department of Women
and Child Development – DWCD, Government of
Karnataka.
• Anupama et.al (2013), “Innovative HR practices to
improve Socio-Economic conditions of Women
Workers in Garment Industry - An Empirical Study”
in IOSR Journal of Business and Management (IOSRJBM) e-ISSN: 2278-487X, p-ISSN:2319-7668, Volume
9, Issue 6 (Mar – April: 2013), pp: 16-21.
• Dr.Pankajakshi R., and Mrs.Arundathi S.V., (2012)
“Key Challenges and Strategies – Women Attrition
in Organization (A conceptual Analysis in Indian
Perspective)” ISBN: 978-0-61-73960-1, ARC-2012 –
International Conference on Business and
Management, Page No. 226-230.
• Dr. Sunil Deshpande and Ms. SunitaSethi (2009),
Role and Position of Women Empowerment in Indian
Society”, International Referred Research Journal,
ISSN-0974-2832, vol. I, Issue-17, RNI: RAJBIL/2009/
29954, pp: 24-27.
• Nuthana Javali Neethi: 2013-2018, New Textile Policy,
Government of Karnataka.
• Productivity & Competitiveness of Indian
Manufacturing Sector: Textiles and Garments,
National Manufacturing Competitiveness Council
(NMCC), Government of India, New Delhi.
• Ramanna Shetty , K.B. Kiran, Mihir Dash(2013), “A
Study on the Impact of Quota Removal on the Textile
and Clothing Industry in Karnataka State”
International Journal of Economy, Management and
Social Sciences, 2(6) June 2013, Pages: 277-284
• S Calvin, B Joseph (2006), “Occupation Related
Accidents in Selected Garment Industries in
Bangalore City” Indian Journal of Community Medicine
Vol. 31, No. 3, July - September, 2006.
• S. Sulaja (2004), “Social Development and Women
in Status –An Analysis of South Indian States”,The
Journal of Family Welfare, Vol. 50, No.2, December
2004, pp: 55-57.
November 2015
Page 66
•
Srilatha Batliwala (2011), “Strengthening Monitoring
and Evaluation for Women’s Rights: Thirteen Insights
for Women’s Organizations” Association for Women’s
Rights in Development (AWID), Toronto, Canada,
2011.
Special Issue
•
Sudeshna Saha (2014), “Women Employees in
Garment Industries A Case Study conducted in
selected Garment Industries of Peenya Industrial
Area, Bangalore” in International Journal of
Management Research and Business Strategy IJMRBS, ISSN: 2319-345X, vol. 3, No. 3, July 2014,
pp: 128 – 137.
November 2015
Page 67
A COMPARATIVE ANALYSIS OF FINANCIAL INCLUSION STRATEGIES
IN BANKS WITH SPECIAL
REFERENCE TO SBI AND ICICI
Dr. Catherine Nirmala Rao1
Abstract
Financial inclusion or inclusive financing is the delivery of financial services at affordable costs to sections of
disadvantaged and low-income segments of society, in contrast to financial exclusion where those services are not
available or affordable. An estimated 2.5 billion working-age adults globally have no access to the types of formal
financial services delivered by regulated financial institutions. The term "financial inclusion" has gained importance
since the early 2000s, a result of findings about financial exclusion and its direct correlation to poverty. Less than half
the population in India has access to any formal financial instrument. Previous work and initiatives in promoting
financial inclusion have mostly focused on the process, that is, how to make banking costs lower. However, such
efforts have seldom yielded much. The institutions relied upon have their own problems. Even after 60 years of
independence, a large section of Indian population still remains unbanked. This malaise has led generation of
financial instability and pauperism among the lower income group who do not have access to financial products and
services. However, in the recent years the government and Reserve Bank of India has been pushing the concept and
idea of financial inclusion. Reserve Bank of India has planned Aadhaar-linked bank accounts for all adults of India
by January 2016 to meet its commitment on financial inclusion. This study is an attempt to analyse and compare the
strategies for financial inclusion of State Bank of India and ICICI Bank. The role of Bank Linkage schemes with SHG
s and the role of MFI s in financial inclusion strategies of SBI and ICICI Bank are evaluated.
Key words: : Financial Inclusion, MFI s (Micro Finance Institutions), Self Help Group (SHG) linkages, Prime Minister’s
Jan Dhan Yojana (PMJDY)
Introduction
The traditional image of Micro Finance is one of charitable
activity conducted mostly by nonprofit organizations and
separate from the mainstream financial system.
However, this image has been changing in India in the
last few years as Commercial Banks have been widely
entering the sector. Banks in India have begun to enter
the Micro finance lending Market, and many are
partnering with regional Micro Finance Institutions.
Increasingly, loans as small as Rs. 4600 are being offered
by mainstream Indian Banks such as ICICI, SBI, HDFC
and UTI, and often contain unconventional covenants
typical of Micro Finance transactions.
India has one of the largest networks of bank branches
in the world, but the hundreds of millions of poor in the
country are largely out of it. Banks were nationalized
three and a half decades ago with the hopes and promise
that their products and services would reach the poor.
But that goal is not even close to being met today. With
52000 Commercial banks branches, 14522 branches of
Regional Rural Banks and 100000 Cooperative Banks
branches, the country is teeming with institutions that
should be able to meet the credit needs of the people.
1
But if you are poor, you are also probably out of luck
with the banks; it is tough persuading them to even let
you open a bank account. The consequences have been
devastating. 75 million households in India depend on
money lenders to meet financial needs; almost 90% of
people in rural India have no access to insurance; 50
million households are landless and need small credit
to start some economic activities. And even families
earning Rs. 4000 – Rs. 5000 a month in urban areas
spend huge portions of their earnings to service their
ever continuous debt.
But out of necessities and enterprise, these locked out
of the banking system would have found a way out. It is
called Micro Finance – the extension of small loans to
individuals who are too poor to qualify for traditional bank
loan as they have no assets to be offered as guarantee.
In India Micro Finance has worked largely through SHGs.
Predominated by women, these are formed with simple
rules – save, accumulate and give loans to each other.
The negative one is that India’s demand for Micro Finance
is Rs. 500 billions, and only Rs. 18 billion of this amount
has been generated so far; there is still a long way to
go. The poor need banking services more than credit,
. Associate Professor & Head of Department of Commerce , St. Agnes Centre for PG Studies & Research,
Mangalore.
Special Issue
November 2015
Page 68
as they need to safely secure their little saving or
remittances coming from their men folk who have
migrated in search of work.
Even the few banks in India who now belatedly recognize
the potential in rural banking lack capability to serve.
This market, which has been neglected for so long,
needs intermediaries to help build their capacity to do
business with small borrowers. Today’s banks are flush
with money. If Micro Finances are strong, banks will
readily lend to them. That there are significant
opportunities for banks in Micro Finance is now
unquestioned.
Review of Research Literature
Devaraja, T.S., 2011. “Microfinance in India - A Tool for
Poverty Reduction”. Devraja T.S. has studied the India’s
achievement of the Millennium Development Goals of
having the population of poor by 2015 as well as achieving
a broad based economic growth also hinges on a
successful poverty alleviation strategy. In this backdrop,
the impressive gains made by SHG-Bank linkage
program in coverage of rural population with financial
services offer a ray of hope.
Saundariya Borbora and Ratul Mahanta (2001)
assessed the role of SHGs in inculcating saving habits
among the poor and the contributions of the program in
the social and economic empowerment of the poor. 80
percent of the beneficiaries could also expand their
income generating activities.
Sridhar Seetaraman (2005) assessed the socioeconomic impact of SHGs through field level data. Study
revealed that creation of income-generating activities
through loans availed of from banks has made a
significant impact on the overall economic status of the
group members. Additional employment generated
through the groups’ collective functioning has provided
scope for increase in the household income.
Even after 60 years of independence, a large section of
Indian population still remains unbanked. This malaise
has led the generation of financial instability and
pauperism among the lower income group who do not
have access to financial products and services. However,
in the recent years the government and Reserve Bank of
India have been pushing the concept and idea of financial
inclusion. Reserve Bank of India has planned Aadhaarlinked bank accounts for all adults of India by January
2016 to meet its commitment on financial inclusion. It
will greatly transform India by preventing the poor falling
into debt-traps of unlawful money-lenders, promote
cashless transactions, elimination of poverty and
corruption. Once bankcards become common in rural
areas, India will become a nation of cashless
Special Issue
transactions, like the USA, with higher transparency and
accountability.
The Reserve Bank of India (RBI) had set up the Khan
Commission in 2004 to look into financial inclusion and
the recommendations of the commission were
incorporated into the mid-term review of the policy (2005–
06). In January 2006, the Reserve Bank permitted
commercial banks to make use of the services of nongovernmental organizations (NGOs/SHGs), microfinance institutions, and other civil society organizations
as intermediaries for providing financial and banking
services. These intermediaries could be used as
business facilitators or business correspondents by
commercial banks. The bank asked the commercial
banks in different regions to start a 100% financial
inclusion campaign on a pilot basis. Reserve Bank of
India’s vision for 2020 is to open nearly 600 million new
customers’ accounts and service them through a variety
of channels by leveraging on IT.
This study is an attempt to analyse and compare the
strategies for financial inclusion of State Bank of India
and ICICI Bank. The role of Bank Linkage schemes with
SHG s and the role of MFI s in financial inclusion
strategies of SBI and ICICI Bank are evaluated.
Methodology
The data and information collected for this study is
acquired from secondary sources. The secondary
sources mainly consisted of ICICI banks of India
published and unpublished records and SBI published
and unpublished records, RBI annual reports, NABARD
reports, journals, books, magazines and related
websites.
1. To study the effectiveness of Bank linkage schemes
of SHG offered by SBI and ICICI banks.
2. To evaluate the schemes of Micro Finance offered by
SBI bank and ICICI bank.
3. To compare the effectiveness of performance of private
and public sector banks with regard to SHG-bank
linkage schemes.
Hypotheses
The service quantum of SBI in the area of micro finance
through bank linkage schemes is far greater when
compared to ICICI.
Analysis and Interpretation Of Data
ICICI Bank
The Indian Banking system has three distinct tiers. The
first tier, where ICICI competes consists of commercial
banks, of which there are approximately 80. In the next
tier are Regional Rural Banks, which operate in
approximately 200 rural command areas. The last tier
November 2015
Page 69
consists of Cooperative and special Purpose Rural
Banks. There are more than 350 Central Cooperative
Banks, 20 Land Development Banks and the number of
Primary Agricultural Credit Societies. India certainly has
an extensive and wide reaching banking system. Yet
despite fairly broad banking coverage nationwide, the
financial system remains inaccessible to the poorest
people in India.
Banking with the poor is a challenging task as the nature
of demand requires doorstep services, flexibility in
timings, and timely availability of services, low value and
high volume transactions requiring simple processes with
minimum documentation. The nature of supply however
involves high cost of service delivery, rigid, inflexible
timings and procedures and high transaction costs for
the customers. With these features on the supply side,
traditional banking is not poised to meet the requirements
of the demand side. The reach of the banking sector in
the rural areas was as low as 15% in terms of credit
potential, and 18% in terms of population with physical
access to a bank branch.
ICICI Bank chose to pursue the unreached rural markets
as part of its strategy of being a universal bank. However,
instead of taking the conventional branch banking model
for increasing its outreach, the Bank decided to work
with models which would combine the strengths of
intermediary forms of organization with the financial
bandwidth of a banking institution.
Initiation to Microfinance – The SHG Bank Linkage
Model
To enable its foray into the rural markets, ICICI Bank
merged with the Bank of Madura (est.1943), which had
a substantial network of 77 branches in the rural areas
of a South Indian state – Tamil Nadu. The Bank of
Madura had expertise in catering to the needs of the
small and medium sector and had a strong network of
SHGs. At the time of the merger the Bank of Madura
had 1200 SHGs. However, the program was not yet
sustainable. To reach profitability ICICI Bank devised a
three- tiered structure. The highest level was to be a
project manager, who would be an employee of the bank.
Six coordinators would report to each project manager
and would in turn oversee the work of 6 promoters. The
target for promotion of groups was 20 groups within 12
months, upon which the promoter would receive financial
compensation from the Bank. The coordinator would
usually be an SHG member who would coordinate the
activities of the promoters.
The women who had finished a year of promoting the
requisite 20 groups were given the designation of Social
Service Consultant. These would travel within a radius
of 15 kilometers, in order to promote as many groups
within their area as possible. Strict guidelines were set
Special Issue
for selection of SHG members and SHGs would be
homogeneity in the socio economic background as well.
The SHGs followed the normal pattern of saving until
they had internally collected an amount of Rs.6000 in a
bank account by each member of the group. After this,
the amount collected would be lent internally at 24%
p.a. This rate of interest was much less than was
available from the informal lenders, and the entire group
stood to gain as the interest was churned back into the
group.
ICICI Bank achieved a high rate of growth, reaching 8000
SHGs in March 2003, with its team of 20 project
managers. Within three years of the merger with Bank
of Madura, ICICI Bank had extended its reach to 12000
SHGs. However, the pace of outreach was still slow,
and the Bank began to experiment with other models of
reaching the unreached. This was because existing
branches could be leveraged for outreach, but in areas
where there were no ICICI Bank branches, it would not
be viable to set up branches solely for the purpose of
rural outreach, as such branches would have a very long
gestation period and would costly in terms of overheads.
ATMs were also costly proposition and the infrastructure
required was not in place in most of the remote areas.
It was felt that in the case of the SHG formation, there
was no risk sharing or financial stake/performance stake
of the social intermediary (NGO) in the process of group
formation. Once the groups were formed and linked to
Bank credit, there was no more responsibility on the
part of the NGO. The SHGs had been repaying at very
good rates, above 95%, yet there was a need to control
the quality of group formation and link it to credit
discipline. ICICI Bank also worked with Self Help
Promotion Institutions to outsource the work of group
formation institutions whose core competence was in
social intermediation.
Microfinance Institutions (MFI) Intermediation
Model
ICICI Bank began to experiment with the micro finance
institutions (MFI) as a substitute for the more regular
Self Help Group. The MFIs were willing to take on the
risk of the financial performance of the groups/individuals
that were being lent to. Therefore the stake in good
quality group formation was also built in. Also, this
channel was better for leveraging large amounts of funds
without necessarily having a grassroots level presence
of the bank staff. The MFI would undertake the processes
and operationalization in terms of group formation, cash
management, disbursal and recovery, and also record
keeping. The Bank would lend to the MFI which would
then repay the bank.
The MFI-Bank linkage model paved the way for taking a
wider range of services to the financially underserved
November 2015
Page 70
populace. These financial services include provision of
micro insurance tailored to the cash flows and insurance
needs of the low-income clients. The intermediation
model at first looked scalable, but there seemed to be
constraints in this model as well. For instance there
was a double charge on capital created, once at the
level of the Bank lending to the MFI on lending to the
client. This seemed to be a sub optimal lending structure
due to the double counting that also, because the small
balance sheet size, unduly affected the risk perceived
about the MFI, even if it had very robust systems and
processes. Other key challenges to performance were
that the MFIs could not grow and scale as fast as their
capabilities would permit, because of severe capital
constraints. MFIs were exposed to the entire risk of
lending to the end clients, despite their constrained risk
appetite. Most MFIs were operating in a single
geography, and the systematic risk that they were
exposed to was large. This put undue risk bearing on
these organizations, especially in the light of their limited
geographical risk diversification capabilities. Banks,
which were lending ostensibly to the end-clients, could
not get access to any information regarding the
repayment capacity, or repayment behavior of the end
clients, as the MFI not only acted as an operating and
servicing agent, but also assumed the entire risk. If the
MFI collapsed due to any internal organizational issues
as opposed to client default, the entire client segment
which had demonstrated creditworthiness would be
deprived of a service provider. On the one hand were the
competencies of the Bank (Which had a large amount
of finances waiting to be channeled into the sector) and
on the other, the social intermediation expertise of the
MFI (which had a grassroots presence customer
outreach and contact, and could also achieve better
economies of scale if it scaled up and extended outreach
faster). There was a need to combine the strengths of
both players, while also building in the correct incentives
and using capital parsimoniously to leverage the
maximum value and client outreach from it. There was
also a need for close supervision and information tracking
so that at no stage would rapid expansion lead to
undetected default due to slackness in monitoring. Costs
would have to be recovered to ensure sustainability. The
model would also have to incentivize growth and preserve
the incentives of the originator (of the portfolio) to maintain
portfolio performance.
ICICI Bank is India’s second – largest bank with total
assets of over Rs.100000 Crore (about US$ 20 billion)
and a network of 450 branches and offices and over 1700
ATMs. The bank has an approximate 30 percent market
share in the retail segment, and was one of the first
commercial banks in India to realize the potential of the
microfinance sector. The Reserve Bank of India (RBI)
requires all private sector banks in India to allocate at
least 18 percent of their net bank credit to the agricultural
sector. ICICI Bank is aggressively focusing on
microfinance to expand its portfolio size.
Direct Lending to Self – Help Groups (SHGs)
ICICI Bank has a portfolio in excess of Rs 60 Crores
(about US$ 12 million) in direct lending to SHGs. The
direct lending portfolio is currently concentrated in the
state of Tamil Nadu. ICICI Bank devised and
implemented a low cost structure consisting of locally
recruited promoters and coordinators. The SHG program
has grown to scale under the new structure and presently
9,500 SHGs have been promoted and linked with the
Bank for their credit and saving requirements.
State Bank of India
SBI -SHG-Bank Credit Linkage
SBI has actively participated in SHG-Bank Credit Linkage
program since its inception in 1992 as a pilot project of
NABARD. Since then, the Bank has made a steady
progress in financing SHGs. SBI is maintaining its
position as a leader among Commercial Banks in credit
linking of SHGs and is a prime driver for the movement.
As at the end of March 2013, SBI, with a share of
approximately 22% of total SHGs financed by
Commercial Banks, is the leader among banks. As on
31st March 2014, Bank’s exposure under the scheme is
Rs. 5,134 Crore to 4.47 lakh SHGs, 92% of these SHGs
are women SHGs. (Table - 1)
Table - 1 : Comparative Analysis of Micro Finance Services Offered to the Poor
Parameter
Money Lender
Commercial
Banks
Government
Sponsored
Programs
Financial Products of
Micro Finance
Institutions
Ease of Access
High
Low
Low
High
Transaction Cost of
Access
Low
Very High
Very High
Low –Medium
Lead time For Loans
Very short
Extremely Long
Extremely Long
Short
Repayment Terms
Fixed and Rigid
Fixed and Easy
Fixed and Easy
Flexible
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November 2015
Page 71
Interest Rates
Exorbitantly
Low and very
Affordable
Low, Affordable
and Subsidized
Reasonable and
Affordable
Incentives
None
None
None
Repeat and Larger Loans,
interest Rebates
Repeat
Borrowing
Possible
Possible but not
Likely
Possible but not
Likely
Stream of Credit
Is Assured
Loan Access
Procedures
Very Quick
Extremely time
consuming and
complicated
Extremely time
Consuming and
Complicated
Simple and Quick
Loan Application
Procedures
Informal and
Exploitative
Exhaustive
And complex
Exhaustive
And complex
Simple and Informal
Collateral and
Demand Promissory
Note
Mandatory
Required but
hypothecation
of asset may
suffice
Not required
although a charge
on the asset
becomes automatic
Not required, social
collateral is used for
physical collateral.
Table - 2 : Showing overall progress of SBI and ICICI SHG - Bank linked programme
Particulars
SBI
ICICI
2009 - 10
2010 - 11
2011 - 12
2012 - 13
2013 - 14
Amt.
Amt.
Amt.
Amt.
Amt.
Bank loans
Disbursed to SHGs
during theYear
2821.19
3063
3249.65
3526.66
3866.13
Bank loans
Outstanding
with SHGSas on
31st March
5892.89
5470.99
5658.05
5600.28
5133.57
Bank loans
Disbursedto SHGs
during theYear
2145.82
1689.89
1104
1901.45
2863.6
Bank loans
Outstanding
with SHGS as
on 31st March
2809.1
2793
2379.14
3217.6
3496.22
Over the years it has been noted on the whole, that the Banks have been performing really good. It is noted that the
quantity of the SBI bank been greater than of the ICICI bank, as ICICI concentrates on quality. It is clear that the SBI
been performing well by disbursing large amount of loan, which is favorable to the bank.
The table also denotes that the loans outstanding of SBI been decreasing. This shows that banks have succeeded
in recovering the loans outstanding to a greater extent. Thus the bank is performing well.
H0: There is no difference between the loans disbursed and loans outstanding of SBI and ICICI banks to SHG –
Bank linked schemes
H1: There is difference between the loans disbursed and loans outstanding of SBI and ICICI banks to SHG - Bank
linked schemes. (Table - 3)
Interpretation
The t test attributes the P value less than 0.05 at the 95% confidence by that it has been rejected the null
hypothesis and says that there is difference between loans disbursed and loans outstanding by the banks to SHG
bank linked schemes. By this it is clear that SBI is been performing well over the years by offering good amount of
loan to the poor as compare to ICICI.
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November 2015
Page 72
Table - 3 : Paired Samples Test
Paired Differences
Mean
Std.
Deviation
Std. Error
Mean
t
df Si
g.
(2tailed)
of the Difference
Lower
Upper
loan disbursed
Pair 1 ICICI - loan
disbursed SBI
-1364.37400 566.60425
253.39313 -2067.90610 -660.84190
-5.384
4
.006
loan outstanding
of ICICI - loan
Pair 2
outstanding of
SBI
-2609.55600 646.65862
289.19453 -3412.48873 -1806.62327 -9.024
4
.001
Table - 4 : Showing comparative statement of SBI and ICICI SHG Bank linkage programmes for the
year 2012-13
Amt. in Crores
Banks
2011 - 12
Amt.
2012 - 13
Amt.
Increase or
decrease
Amt.
Increase or
decrease
in%
Bank loans Disbursed to
SHGsduring theYear
3249.65
3526.66
277.01
8.7
Bank loans Outstanding
with SHGS as on 31st
March
5658.05
5600.28
-57.77
-1.02
Bank loans Disbursed
to SHGs during the
Year
1104
1901.45
797.45
72.23
March
2379.14
3217.6
838.46
35.24
Particulars
SBI
ICICI
Table - 5 : Showing comparative statement of SBI and ICICI SHG Bank linkage programmes for the
year 2013-14
Amt. in Crores
Banks
Particulars
2012 - 13
Amt.
2013 - 14
Amt.
inc.or dec
Amt.
inc. or dec
in%
to SHGs during theYear
3526.66
3866.13
339.47
9.6
March
5600.28
5133.57
to SHGs during theYear
1901.45
2863.6
962.15
50.6
March
3217.6
3496.22
278.62
8.65
SBI
466.71
8.33
ICICI
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November 2015
Page 73
The table shows that o/s loans to SHGs by the banks. SBI has loans o/s of-1.02% in the year 2012-13 and -8.3%
in 2013-14. This shows favourable result to the bank as it has succeeded in recovering the loan to a greater extent.
This shows that the SBI bank is concentrating more on recovering the loan, where it feels that it has been generous
in disbursing loan in the past years.
Even the ICICI bank have succeeded in recovering the loan o/s. i.e 35.24% in the year 2012-13 and in 2013-14 it is
– 8.65% this is clear sign that bank has recovered the loan and performing well.
Table - 6 : Showing Cumulative progress of SBI - SHG - Bank linkage programme for the year 2013-14
No and amount in Lakhs
Particulars
2009-10
2010-11
2011-12
2012-13
2013-14
NO.of SHGs
1216891
1270604
1351792
1716898
1898832
15453057
16198891
17156300
18388417
19206635
Savings Account
84650
87926
93406
95951
97763
Amount disbursed
282119
306300
324965
352666
386613
Amount Outstanding
589289
547099
565805
560028
513357
No of
Beneficiaries
Amount in
The above table is an Analysis of State Bank of India,
SHG – Bank Linkage Program for the years 2010-11,
2011-12, 2012-13, 2013-14
• Firstly the table shows an increase trend in the SHG
Linked for the year 2010-11, 2011-12, 2012-13, 201314, i.e, 104.4%,111%, 141.5%, 156%. This Shows
that, the bank has involved in many SHG schemes
and has kept progressing year after year
• Secondly it can be seen that the number of
beneficiaries of SHGs schemes have also increased
year after years by 104.8%, 111% , 118%, and 124%.
This increase in the No. of beneficiaries has
contributed much to the growth of the bank each year.
Banks on the other hand have concentrated on its
objective of gaining more No. of beneficiaries every
year.
• Thirdly the table and chart shows an increasing trend
in the amount disbursed by SBI to SHGs. Every
year the bank has been able to disburse an enormous
amount of loans which constitute the following
increase in the percentage for the year 2009-13 i.e.
108.7%, 115%, 125% and 137.03%. This increasing
trend in the loans disbursed to SHGs clearly states
that bank has been efficient in providing the loans
required to Its SHGs. Though the demand for the
loans has been large, the bank was able to cope
with its increased demand for loans by its SHGs.
• Fourthly the table also shows the amount o/s by the
SHGs in repayment of its bank loans. The amount
o/s also shows the decreasing trend i.e. 92.84%,
96.01%, 95.03% and 87.11% for the years 2009-2013.
Here the banks have made effort to recover the loan
amount.
Special Issue
•
Finally, it can be seen in the table that there is a
tremendous increase in the No of SHGs maintaining
savings a/c in the bank. All the years’ bank has
increased the SHGs that have maintained savings a/
c. The increasing trend for the years 2009-13 are
103%, 110.34%, 113.25% and 115.49%. This clearly
shows that all the SHG believe in the savings a/c
that is provided by the bank and they take most
benefit of these facilities given by the bank. Hence
there is an increase in the growth of savings a/c
maintained by many SHGs.
Scope & Limitations of the Study
This study is restricted to State Bank of India, the leading
Public sector Bank which is a pioneer in Micro finance
and ICICI Bank which is the Pioneer in Private Sector
banks.
The data collected under the current study was basically
from the secondary sources as such the limitations of
secondary sources apply to this study. Banks are
unwilling to disclose any information other than those
that is published on their websites. Hence this study is
based on analysis of published reports only.
Bibliography
Books
1. V.S. Somanath Ph.D, “ MICRO FINANCE
REDIFINING THE FUTURE”, Excel Books Publisher,
New Delhi, Ist Edition – 2009
2. Debudutta Kumar Panda, “UNDERSTANDING
MICRO FINANCE”, Wiley India Pvt. Ltd., New Delhi
– 2009.
November 2015
Page 74
3. Fisher Thomas and Sriram M.S. 2008. “BEYOND
MICROCREDIT, PUTTING DEVELOPMENT BACK
INTO MICRO-FINANCE”, Vistaar Publications, New
Delhi.
Reports
1. N. Srinivasan; “ MICRO FINANCE STATE OF THE
SECTOR REPORT”, Sage Publications India Pvt.
Ltd., - 2012
2. NABARD; “STATUS OF MICRO FINANCE IN INDIA”,
2011 – committed to Rural Proserity Mumbai.
3. CRISIL Rating; “ INDIA TOP 50 MICRO FINANCE
INSTITUTIONS” – October 2009.
Special Issue
Journals
1. A. Saraswathy, S. Porkodi, M. Bhuveneswari,
“MICRO FINANCE IN KRISHNAGIRI DISTRICT: A
TOOL FOR POVERTY ALLEVATION.” Indian Journal
of Marketing, May 2009, Pg.47.
2. Saving Grace, SHG – Bank Linkage Program in
Andhra Bank – issue 13 Nov-2006.
3. Dr. P. Loganathan, R. Ashokan. “INTER REGIONAL
DEPARTMENT OF SHGS IN INDIA”, Gurushetra,
Sep- 2006.
4. Sriram, M.S. and R.S. Upadhyayula, 2004. The
transformation of the microfinance sector in India:
experiences, options and future. Journal of
Microfinance, 6(2): 89-112
November 2015
Page 75
INFORMATION AND COMMUNICATION TECHNOLOGY & ITS IMPACT
ON EDUCATION
Dr. Chandra Purkayastha1
The Promise of ICT in Education
For developing countries ICTs have the potential for
increasing access to and improving the relevance and
quality of education. It represents the possibility of
providing quality education for a much larger universe of
students than was hitherto possible. This is a game
changing development for poorer countries.
Information and communications technology (ICT) in
education has been taken up by educators and
educational researchers since the 1980s with varied
success. However, it is the relatively recent uses of the
Internet and World Wide Web that are stimulating new
demands and expectations in education. ICTs cover
Internet service provision, telecommunications
equipment and services, information technology
equipment and services, media and broadcasting,
libraries and documentation centers, commercial
information providers, network-based information services
Three implications are notable as a result of ICT in
education. Firstly, the computer has become a
productivity and communication networking device
beyond its uses as a standalone machine. Secondly,
the new trend towards cloud services from remote
locations no longer requires the purchase and installation
of desktop software productivity applications. Lastly, the
www as a platform for interactive communication is
changing the expectations of experienced and
connected online users from a need to a demand model
of communication.
Information and Communication Technology (ICT)
presents the promise of providing better education to
more people more efficiently than can be accomplished
without technology. Spurred by these apparent promises,
countries around the world have invested massively in
ICT education over the past decade. Despite the
investment, however, the world has been slow to obtain
the pervasive changes in education that have been seen
in such industries as music, travel, and news. Thus at
the heart of this study is the question: what are the
key factors that determine ICT impact on
education?
1
Traditional class teaching is increasingly under pressure.
Information and communication technology, and in
particular the rise of the internet, is regarded as both a
cause and an enabler. The current young generation has
grown up with the internet. Traditional class teaching
does not seem to fit very well with the learning style of
these digital citizens. The aim of the new method is to
decrease the gap between the learning environment and
the environment in which the pupils will later have to live
and work.
There are profound concerns now about the gaps opening
up between the ICT haves and have-nots, between those
who reinforce their access to, and use of, ICT in education
by what they have and do at home, and those who enjoy
little of either. In India the gap between those who have
access to and control of technology and those who do
not is significant. The reality of the Digital Divide—means
that the introduction and integration of ICTs at different
levels and in various types of education will be a most
challenging undertaking. Failure to meet the challenge
would mean a further widening of the knowledge gap
and the deepening of existing economic and social
inequalities.
ICTs are potentially powerful tool for extending educational
opportunities, both formal and non-formal, to previously
underserved users. The following benefits make ICT a
transformational tool.
• Overcome time and space limitations: One defining
feature of ICTs is their ability to transcend time and
space. ICTs make possible learning characterized
by a time lag between the delivery of instruction and
its reception by learners. Online course materials,
for example, may be accessed 24 hours a day, 7
days a week. ICT-based educational content
dispenses with the need for all learners and the
instructor to be in one physical location.
• Access to remote learning libraries. Teachers and
learners no longer have to rely solely on printed books
and other materials in physical media housed in
libraries for their educational needs. With the Internet
and the World Wide Web, a wealth of learning
materials in almost every subject and in a variety of
media can now be accessed from anywhere at
. HOD, Department of Economics, K. J. Somaiya College of Arts and Commerce, Mumbai, India.
Special Issue
November 2015
Page 76
anytime of the day and by an unlimited number of
people.
One of the most commonly cited reasons for using
ICTs in the classroom has been to better prepare the
current generation of students for a workplace where
ICTs, particularly computers, the Internet and related
technologies, are becoming more and more
ubiquitous. Technological literacy, or the ability to
use ICTs effectively and efficiently, is thus seen as
representing a competitive edge in an increasingly
globalizing job market.
ICTs and the Quality of Education
Improving the quality of education and training is a critical
issue, particularly at a time of educational expansion.
ICTs can enhance the quality of education in several
ways: by increasing learner motivation and engagement,
by facilitating the acquisition of basic skills, and by
enhancing teacher training.
• Motivating to learn: ICTs such as videos, television
and multimedia computer software that combine text,
sound, and colourful, moving images can be used to
provide challenging and authentic content that will
engage the student in the learning process.
• Facilitating the acquisition of basic skills: The
transmission of basic skills and concepts that are
the foundation of higher order thinking skills and
creativity can be facilitated by ICTs through drill and
practice.
• Enhancing teacher training: ICTs have also been
used to improve access to and the quality of teacher
training.
ICTs and learner-centered environment
Research has shown that the appropriate use of ICTs
can catalyze the shift in both content and pedagogy
that is at the center of education reform in the 21st
century. If designed and implemented properly, ICTsupported education can develop the skills to acquire
lifelong learning framework.
Contemporary learning theory is based on the notion
that learning is an active process of constructing
knowledge rather than acquiring knowledge and that
instruction is the process by which this knowledge
construction is supported rather than a process of
knowledge transmission
When used appropriately, ICTs—especially computers
and Internet technologies— enable new ways of teaching
and learning. Creative use of the technology will allow
teachers and students to do what they have done before
in a better way. These new ways of teaching and learning
constitute a shift from a teacher-centered pedagogy,
characterized by memorization and rote learning, to one
that is learner-centered.
Special Issue
The Library
First, there is a world of difference between the
“knowledge” society and the “information” society. It is
common to ‘google’ any query that a student might have.
The greatest contribution of ICT in education has been
the explosive growth in availability of information and
their easy retrieval. It must be remembered that
‘knowledge’ and information’ are not the same thing.
Thanks to ICT that place we remember as a ‘library’ has
seen a profound change.
With the invention of Information and Communication
Technology, libraries now use various types of
technologies to aid the services they render. Everyday
new technological advances affect the way information
is handled in libraries. The academic library has been
from its inception an integral part of institutions of higher
learning.
Academic libraries are those libraries that are mainly
found in tertiary institutions. They are established to
support learning, teaching and research processes. The
introduction of various information technology (ICT)
developments has lead to reorganization, change in work
patterns, and demand for new skills, job retraining and
reclassification positions. Technological advancement
such as the electronic database, online services, CDROMs and introduction of internet has radically
transformed access to information. ICT holds the key to
the success of modernizing information services.
Applications of ICT are numerous but mainly it is used
in converting the existing paper-print records in the entire
process of storage, retrieval and dissemination to a
digital form.
ICT has impacted on every sphere of academic library
activity especially in the form of the library collection
development strategies, library building and connected
libraries. ICT presents an opportunity to provide valueadded information services and access to a variety of
digital based information resources to their clients. In
addition, academic libraries are also using modern ICTs
to automate their core functions, implement efficient and
effective library cooperation and resource sharing
networks. They are implementing management
information systems, developing institutional repositories
of digital local contents, and digital libraries: and initiate
ICT based capacity building programs for library users.
Their customer relationship can be provided more
efficiently and effectively using ICT. They offer convenient
time, place, cost effectiveness, faster and most-up-todate dissemination and end users involvement in the
library and information services process.
The emergence of internet as the largest repository of
information and knowledge has been revolutionary. There
is a changed role of library and information science
November 2015
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professionals from intermediary to facilitator. The
extinction of some conventional information services and
emergence of new and innovation web based solutions
means that ICT has changed the library for good.
• As a result of. ICT, modern education mobilizes tools
for examination, calculation and analysis of
information, thus providing a platform for student
inquiry, analysis and construction of new information.
Learners therefore learn as they complete and,
whenever appropriate, work on real-life problems indepth. This makes learning less abstract and more
relevant to the learner’s life situation. In this way,
and in contrast to memorization-based or rote
learning, ICT-enhanced learning promotes increased
learner engagement.
• ICT turns learning into collaboration: ICT-supported
learning encourages interaction and cooperation
among students, teachers, and experts regardless
of where they are. It models learning done throughout
the learner’s lifetime by expanding the learning space
to include not just peers but also mentors and experts
from different fields.
• ICT explores the creative abilities of the students:
ICT-supported learning promotes the manipulation of
existing information and the creation of real-world
products rather than the repetition of known
information.
• ICT makes it easier to consider different disciplines
to understand an issue. ICT-enhanced learning
promotes an, integrative approach to teaching and
learning. This approach eliminates the artificial
separation between the different disciplines and
between theory and practice that is the bane of the
traditional classroom approach.
The Challenge of Implementation
Education policymakers and planners need to be clear
about what educational results are being sought. These
broad goals should guide the choice of technologies to
be used and their modalities of use. Education,
especially school education, is a matter of intense
national cultural interest. Flourishing education
assessment mechanisms are largely based on
accountability to national, provincial/state or local
bodies. There is an uneasy tension because of the
spread of global communications. There is a recognition
of the key role of learning throughout the life span to
meet a wide set of ambitious policy and personal
objectives. And, for this to work, learning must be available
in a much broader and more flexible manner than that
which can be squeezed into syllabuses in the first quarter
of our lives. It can be just an addition to the text bookblackboard methods existing now. Increasingly, however,
it is something different - through using the World Wide
Special Issue
Web, Intranets and networks – it seeks to create
interactive, individualized learning situations.
Effectiveness, cost, equity, and sustainability are four
broad issues which must be addressed when considering
the overall impact of the use of ICTs in education. The
educational effectiveness of ICTs depends on how they
are used and for what purpose. And like any other
educational tool or mode of educational delivery, ICTs
do not work for everyone, everywhere in the same way.
Learning with the technology means focusing on how
the technology can be the means to learning outcomes
across the curriculum. It includes:
• Presentation, demonstration, and the manipulation
of data using productivity tools.
• Use of curriculum-specific applications types such
as educational games, drill and practice, simulations,
tutorials, virtual laboratories, visualizations and
graphical representations of abstract concepts,
musical composition, and expert systems.
• Use of information and resources on CD-ROM or
online such as encyclopedia, interactive maps and
atlases, electronic journals and other references.
Technological literacy is required for learning with
technologies to be possible, implying a two-step process
in which students learn about the technologies before
they can actually use them to learn.
Changes in the Last Decades
It is difficult to quantify the degree to which ICTs have
helped expand access to basic education since most of
the interventions for this purpose have been small-scale
and under-reported
Research suggests that the use of computers, the
Internet, and related technologies, with adequate teacher
training and support, facilitates the transformation of the
learning environment into a learner-centered one. But
these studies are criticized for lacking in empirical rigor.
There is no strong evidence that this new learning
environment fosters improved learning outcomes.
The Sustainability of ICT-Enhanced Educational
Projects
When considering the alternative of building more
physical infrastructure, the cost savings to be realized
from sharing resources ICT are attractive. The social
price of not providing access to all, means ICT that
enables teaching and learning appears to be a necessary
alternative.
One aspect of development programs that is often
neglected is sustainability. Many ICT based projects and
programs start with a bang but all too soon fade out with
a whimper, to be quickly forgotten. In many instances,
these projects are initiated by third party donors—such
November 2015
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as international aid agencies or corporations—and not
enough attention is paid to establishing a mechanism
by which the educational institution or community
involved can pursue the project on its own or in partnership
with other stakeholders after the initiating donor exits.
But cost and financing are not the only barriers to
sustainability
It has been argued that the levels of cost support the
argument against putting computers in every classroom,
particularly in primary schools where there are no strong
curricular arguments for investment in computers. In
secondary schools, spending money on computers may
be justified by the curriculum but this will come with
significant increases in total school expenditure.
The costs of implementing an ICT system will include
the following elements.
Fixed Costs
• Retrofitting of physical facilities
• Hardware and networking
• Software
• Upgrades and replacement (in about five years)
Variable or Recurrent Costs
• Professional development
• Connectivity, including Internet access and telephone
time
• Maintenance and support, including utilities and
supplies
Obviously, these economies of scale may be achieved
only in countries with large populations.
Another dimension of cost is who will pay for what. In
projects that involve computers connected to the Internet,
either the school or student or both bear the variable
costs related to operations such as maintenance,
Internet service charges, and telephone line charges.
The sustainability of ICT-enabled programs has four
components: social, policy, technological, and
economic.
Economic sustainability refers to the ability of a school
and community to finance an ICT-enabled programme
over the long term.
Social sustainability is a function of the different
stakeholders. The school is part of the community, and
for an ICT-enabled project to succeed the consent of
parents, political leaders, business leaders and other
stakeholders is essential.
Policy sustainability refers to issues of policy and
leadership. One of the biggest threats to ICT-enabled
projects is resistance to change. If, for instance, teachers
refuse to use ICTs in their classrooms, then use of ICTs
can hardly take off
Special Issue
Technological sustainability involves choosing
technology that will be effective over the long term. In a
rapidly changing technology environment, this becomes
a particularly tricky issue as planners must contend with
the threat of technological obsolescence.
Challenges in Integrating ICTs in Education
Although valuable lessons may be learned from best
practices around the world, there is no one formula for
determining the optimal level of ICT integration in the
educational system. Significant challenges that
stakeholders need to consider include educational policy
and planning, infrastructure, language and content,
capacity building, and financing. In broader terms a strong
direct relationship between the presence and use of ICT
and educational performance as traditionally measured
was not found. That may be due to ineffective use of ICT
or it may be that it will require some incubation time to
see the effects. However, while the direct influence of
the use of ICT on performance is limited, it is
considerably stronger on attitude and confidence.
Attitude, in turn, has a positive correlation with
performance, which was found in all reference countries.
Using worldwide surveys of the educational performance
of students, a statistical analysis led to the following
specific findings:
• There is not a strong direct relationship between the
presence and use of ICT (either at home or at school)
and educational performance.
• ICT use does have a positive relationship with student
attitudes toward math and science. These attitudes,
in turn, contribute positively to performance.
• However, there is a negative relationship between the
use of computers at home and reading performance,
presumably because computer use at home can be
for entertainment that takes time away from school
work.
• ICT availability contributes to the level of use, but
insufficient investment in soft infrastructure (teacher
skills and organizational changes) limits its impact.
• The availability of ICT at home is positively related to
learning performance. Remarkably, though, the
intensity of ICT use at home is negatively related to
learning performance.
• The most likely explanation is that ICT at home is
used for entertainment, such as gaming. This might
indicate that the time spent on ICT use for
entertainment purposes negatively impacts learning
time for schoolwork.
• Self-perceived performance on ICT skills has a positive
relation to attitude toward science. This positive
relationship is probably entirely due to self selection:
students who consider they to have advanced ICT
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skills generally also like sciences (i.e., the “nerd”
argument).
• Computer use at home has a positive relation to
attitude toward science. The rationale behind this
relation is, as it was for ICT skills, the “Nerd”
argument. This line of reasoning is strengthened by
the fact that computer use at home does not have a
positive relation to attitude toward reading.
• Parents’ intellectual background has a profound
positive relation to both performance and attitude
toward science.
• Time for subjects (that is, actual instruction time) in
regular lessons has a positive impact on performance.
This shows that traditional class teaching has a better
impact on learning performance than newer teaching
methods that don’t emphasize classroom teaching.
• Physical teaching limitations have a negative relation
to the attitude toward science. The teaching
limitations as experienced by the teachers seem to
have a negative effect on their teaching, and
consequently on the motivation of their students.
• Attitude toward science and math has a negative
relation to attitude toward reading. Simply stated,
students who like science and math dislike reading
and the other way around.
Thus, indirectly, the use of ICT (both at home and at
school) contributes to education performance. In one
particular case there was a direct relation between the
presence of computers at home and performance. This
argument is supported by the fact that whereas the
availability of ICT at home is positively correlated to
performance, the use of ICT at home is negatively related.
The latter can be explained by the fact that time spent
on computers at home (for social or entertainment
purposes) cannot be spent on school work.
However, the strength of the relationships found was
weaker than expected, and even weaker with regard to
education.
Yet when it comes to the impact of the use of ICT, it is
positive for science and math but negative for reading.
The contrast between science and math, on one hand,
and reading on the other hand, is in fact so strong that a
strong negative correlation in the macro model (i.e.,
across all countries) was found between attitude toward
science and math and attitude toward reading. In a similar
vein, whereas the use of computers at home has a
positive relation to the attitude toward science and math
(and attitude on performance in science and math), it
has a negative relation to reading performance. It should
be noted that the impact of ICT is notoriously hard to
isolate from overall organizational changes.
Special Issue
Infrastructure-Related Challenges in ICT-Enhanced
Education
Another basic requirement is the availability of electricity
and telephony. In developing countries large areas are
still without a reliable supply of electricity and the nearest
telephones are miles away. Experience in some
countries in Africa point to wireless technologies (such
as VSAT or Very Small Aperture Terminal) as possible
levers for leapfrogging. Although this is currently an
extremely costly approach, other developing countries
with very poor telecommunications infrastructure should
study this option.
Teachers: A point to highlight is the key role of teachers.
How successfully ICT is used in education and how much
it does break the mould, depends so much on teachers.
The emerging generations of ICT use in education might
well be described as “learner centered” but they can
equally be described as “teacher-intensive”,
Teacher professional development should have five
areas:
1) Skills with particular applications;
2) Integration into existing curricula;
3) Curricular changes related to the use of IT (including
changes in instructional design);
4) Changes in teacher role
5) Underpinning educational theories.
Ideally, these should be addressed in pre-service teacher
training and built on and enhanced in-service. Teachers
should believe in the effectiveness of technology,
teachers should believe that the use of technology will
not cause any disturbances, and finally teachers should
believe that they have control over technology. Teaching
accreditation requirements include training in ICT use
can be considered. ICTs are swiftly evolving technologies,
however, and so even the most ICT fluent teachers need
to continuously upgrade their skills and keep abreast of
the latest developments and best practices.
Even if it turns out that actual savings are hard to make,
by working towards realizing the exciting potential of
ICT, in combination with the other ingredients in good
education, there should be an expectation of a clear
upward hike in the quality of teaching and learning. If
realized, this would represent value for money in a very
real sense - genuine educational investment. This is
what we should be aiming for.
Conclusion
Quality in education through ICT and its appreciation
among stakeholders will have positive impact on the
society. ICT can be employed in formal and non-formal
types of education and would direct to make the learners
employable and socially useful part of the society. By
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Page 80
employing ICT in teacher training, the technology can
save a lot of money of the Government. Moreover a lot of
qualitative improvement can be seen as resource persons
for the training can be accessed from any part of the
world. By employing ICT in administrative functions
institutions can develop information systems that will
evaluate and report developments as it occurs. Good
quality content is one of the major issues and directly
affects the standards of education and quality Content
development specific to the needs of the students can
lead to a creative change in aligning the abilities of the
students and the needs of society. There is a long way
to go to realize the potential of ICT but it promises to be
a paradigm shift in the way education is rendered.
References
Alexander Tom (1999) TechKnowLogia, Knowledge
Enterprise, Inc. “ICT in Education. Why Are We
Interested? What Is at Stake?”www.TechKnowLogia.org.
Bhattacharya, I. & Sharma, K. (2007), ‘India in the
knowledge economy – an electronic paradigm’,
International Journal of Educational Management Vol.
21 No. 6, Pp. 543- 568.
Special Issue
Chandra, S. & Patkar, V. (2007), ‘ICTS: A catalyst for
enriching the learning process and library services in
India’, The International Information & Library Review Vol.
39, No. (1), Pp; 1-11. ,
IJPSS (2012) “ICT as a Change Agent for Education”.
Volume 2, Issue 6 ISSN: 2249-5894
http://www.ijmra.us 542
Research Report “The Linked World” ‘How ICT Is
Transforming Societies, Cultures, and Economies.’
www.conferenceboard.org
Sharmila Devi, Mohammad Rizwaan, Subhash
Chander (2013) “Integrated approach to Technology
in Education” (ITE) Sir Dorabji Tata Trust 2013
Syed Noor-Ul-Amin (2011) University of Kashmir “An
Effective use of ICT for Education and Learning by
Drawing on Worldwide Knowledge, Research, and
Experience
November 2015
Page 81
A STUDY ON IMPACT OF AGMARK STATUS IN CONSUMPTION
PATTERN WITH SPECIAL REFERENCE TO TIRUNELVELI CITY
Dr. D. Janis Bibiyana1
S.Sarala lakshmi2
Abstract
Agmark is the quality mark of Government of India, which is given to agricultural commodities. The agricultural
produce act is permissive and the grading under the same has come to be known as ‘AGMARK’ Grading. The grade
standards are based on both physical characteristics and internal attributes such as weight, size, shape, colour and
material. This study aims to study the public awareness about AGMARK and to study the impact of AGMARK status in
consumption. Well framed questionnaire was used to collect data from the customers. 150 sample respondents were
selected from Tirunelveli city by convenient sampling technique. Hypotheses was framed and tested with chi-square
test. 5 point Likert’s scaling technique and Percentage analysis also made to draw the meaningful inferences from the
study. An analysis of the socio-economic distribution of the customers and Agmark item reveals that age, education,
family size, income level of the respondents was not found to influence the level of satisfaction on the Agmark
products. 63 respondents highly agreed with Agmark articles are course better than others and Agmark articles only
sold at every shop.
Key words: Consumer behavior, customer satisfaction, Quality control
Introduction
The word Agmark denotes Agricultural marketing. Agmark
is the quality mark of Government of India, which is given
to agricultural commodities. This scheme was
established by passing “The Agricultural produce Grading
and Marketing Act 1937”. This act defines standards of
quality, fixing grade designations to indicate quality and
prescribing grade designation marks with regard to
scheduled agricultural products. The act gave statutory
powers to the government of India to prescribe grade
standards for various agricultural commodities. The
agricultural produce act is permissive and the grading
under the same has come to be known as ‘AGMARK’
Grading. The grade standards are based on both physical
characteristics and internal attributes such as weight,
size, shape, colour and material.
analysis also made to draw the meaningful inferences
from the study.
Hypotheses
Ho: Socio-economic status of the sample respondents
does not influence the level of satisfaction towards the
Agmark products.
Data analysis and Interpretation
Consumers’ quality preference towards the use of
agricultural commodities may differ from person to
person. The socio-economic status of the sample
respondents may affect the usage of agricultural
commodities and their quality preference. Hence, socioeconomic status like age, educational qualification, size
of the family, and monthly income were analyzed.
(Table -1)
Objectives
This study aims to study the public awareness about
AGMARK and to study the impact of AGMARK status
in consumption.
Methodology
To attain the objectives of the study data were collected
from both primary and secondary source. Well framed
questionnaire was used to collect data from the
customers. 150 sample respondents were selected from
Tirunelveli city by convenient sampling technique.
Hypotheses was framed and tested with chi-square test.
5 point Likert’s scaling technique and Percentage
1
. Assistant Professor in Commerce, St. John’s College, Palayamkottai.
Assistant professor in Department of BBA ST.XAVIER’S college, Palayamkottai
2.
Special issue
November 2015
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Table - 1 : Socio-economic status of the sample respondents
Particulars
No
%
particulars
Age
%
No
Family size (members)
Below 30 years
33
22
1-2
11
7
30 – 40 years
45
30
3-4
79
53
40 – 50 years
42
28
5-6
48
32
Above 50 years
30
20
7-8
12
8
Income (monthly)
Education
Below 20000
69
46
School level
45
30
20000 - 30000
39
16
Under
Graduates
42
28
30000 - 40000
25
17
Post Graduate
52
34
Above 40000
17
11
professional
12
8
Source: primary data
Table 1 shows that a significant proportion of the respondents (30%) were of the age group 40-50years. Maximum
respondents (46%) were earning below Rs.20000 per month. 53% respondent’s family size is 3-4. Most of the
respondents were having education only up to school level.
Table - 2 : Qualitative response about Agmark products
Level of Qualitative Statement
Particulars
Sl.
No
Highly
Agreed
Agreed
No
Less
Highly
idea
Agreed
Less
Total
Agreed
1.
Consumers are adviceto buy
27
57
24
27
15
150
Agmark articles only
2,
Much importance should be
given to Agmark products
87
39
6
9
9
150
3
Awareness should be created to
75
45
9
12
9
150
63
39
15
21
12
150
48
69
15
9
9
150
63
51
12
9
15
150
36
36
21
12
45
150
48
63
9
12
18
150
consume Agmark articles.
4.
Agmark articles only sold at
every shop.
5.
Agmark articles are always high
in demand.
6.
Agmark articles are course better
than others.
7.
Many articles are being marketed
without Agmark label.
8.
No qualitative difference exists
between Agmark and nonAgmark products.
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November 2015
Page 83
9.
No price difference is observed.
15
12
9
36
78
150
10.
Quality grading of articles not at
21
60
15
12
42
150
12
6
18
12
102
150
105
24
6
9
6
150
18
21
15
36
60
150
all necessary.
11.
Quality grading increases the
12.
Quality of the product should be
13.
Agmark grading should be
cost of the product.
certified genuine.
insisted to all products.
14.
Govt. has to direct sale of quality
products.
39
69
15
9
18
150
15.
Standard quality measure is
51
60
15
9
15
150
709
(32)
651
(29)
204
(9)
234
(11)
453
(20)
needed.
Total
2250
(100)
Source : Primary data.
Table 2 reveals that majority of the customers know about Agmark products and using these articles. The figures in
the parenthesis show the percentage to the total.
Table - 3 : Computed Chi-Square Values
Particulars
Result at 0.05 level
Chi-Square Values
Calculated value
Table value
Age
1.23
12.6
Accepted
Education
1.25
12.6
Accepted
Income
1.23
12.6
Accepted
1.7
12.6
Accepted
Family size
Table 3 shows that calculated chi-square values are less than the table value 12.6 and hence, the Null hypothesis,
Socio-economic status of the sample respondents do not influence the level of satisfaction towards the Agmark
products is accepted at 5% level of significance. It implies that all the people like Agmark products irrespective of
their socio economic background.
Table - 4 : Customers’ Expectations
Expectations
Reduce Agmark products price.
Punish the adulterators.
No. of Respondents
Percentage
Rank
113
75
2
98
65
3
More advertisement is necessary
78
53
5
Customer awareness program is
necessary.
90
64
4
119
79
1
Government must take efforts to grade
the product by accreditation.
Source : Primary data.
Table 4 explains that mostly 119 out of 150 respondents expect that Government must take efforts to grade the
product by accreditation as it ranked first. 113 out of 150 respondents expect to Reduce Agmark products price as
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November 2015
Page 84
it ranked second. 65% of the respondents viewed that
Punish the adulterators and was ranked third. 90
respondents being 64% felt that Customer awareness
program is necessary.
Therefore Agmark products are called upon to adhere to
the various suggestions brought forth by the esteemed
respondents who alone will justify the Agmark products.
Finding
An analysis of the socio-economic distribution of the
customers and Agmark item reveals the following fact:
a higher percentage of the respondents belong to the
age group of 30-40. Majority of the respondents (34%)
are postgraduates. A large number of respondents (53%)
have monthly income of below 20000. Majority of the
respondents (46%) belong to the family size 2-4.
However, age, education,, family size, income level of
the respondents were not found to influence the level of
satisfaction on the Agmark products. 105 respondents
out of 150 highly agreed with Quality of the product
should be certified genuine and 87 respondents highly
agreed with much importance should be given to Agmark
products. 63 respondents highly agreed with Agmark
articles are course better than others and Agmark articles
only sold at every shop.
Suggestions
1. Publicity campaign may be arranged by the Agmark
authorities to know about Agmark status for
agricultural products.
2. Meeting of the farmers must be periodically arranged
to demonstrate the latest technology.
3. It is suggested that producers and sellers may sell
the Agmark products at reasonable price to suit the
needs of the middle income groups.
Special issue
4. Advertisement should be attractive and influencing.
In addition, they should be more informative to the
buyers.
5. Government should take efforts for Agmark products
to be graded by accreditation.
6. More number of Agmark laboratories are to be
introduced in Tirunelveli district.
Conclusion
All respondents at Tirunelveli district are aware of Agmark
products. The Agmark certification can be extended to
more number of products without much taxation. The
Agmark may include accreditation. Though market
economy minimized adulteration to some extent, Agmark
certification is essential for all the agricultural products.
References
•
•
•
•
Acharya, S.S., & N.L.Agarwal., Agricultural Marketing
in India, Calcutta: Oxford & IBH Publishing Co. Pvt.
Ltd., 1996.
Murugarathinam, A., & T. Aranganathan., Agricultural
Marketing Infrastructure in Tamilnadu, Kissan World,
33 (10):2006.
Raravikar.Y.G., Role of Agmark Products in our daily
life, Agricultural Marketing Golden Jubilee
Supplement, Government of India, 28 (4): 1986.
Tonapi. A.T., Agmark as an aid to Internal and Export
trade, Agricultural Marketing Golden Jubilee
Supplement, Government of India.
November 2015
Page 85
DECODING THE YOUNG CONSUMERS – A LITERATURE REVIEW
Dr. Deepak Ashokkumar1
Abstract
Human beings pass through different age groups as they grow up. During this process, they experience a plethora of
physiological and psychological changes. In other words, human beings evolve in a dynamic manner as they
progress through different stages in their lives. Among all the age related life stages, the young age can be very well
considered as the turning point in anyone’s life. It is during this stage that people experience and undergo major
transformation which goes on to influence their future life stages. So also an individual’s consumption oriented
knowledge and skills begin to take a shape during the young age. The current paper attempts to conduct an exploratory
study through literature review focusing upon young consumers.
Introduction
Youth are those individuals between the ages of 15 and
24 years (adopted from United Nations Habitat, 2012).
A significant percentage of youth population in India
attains some sort of financial independence around the
age of 25 years. The youth who are less than 24 years
old mostly depend upon their parents for financial
assistance. But the present youth segment of India, is
unique in terms of its sheer size, consumption of
products/services, intellectual ability, pester power, trend
setting capability and positive attitude towards modern
technology. The young generation of the current era
considers shopping as an experience rather than a mere
act of purchasing a product. Possessed with lesser
commitments, the youth purchase or use products/
services at their will. Further, they are also capable of
influencing the consumption at even household level.
Hence, the marketers and retailers operating in the
country have a daunting task ahead of them in targeting
and tracking a unique set of young consumers for their
products and services.
Until 12 years of age, the influence of parents over their
children’s consumption is very high as they are in their
growing - up phase and can only request parents for the
products they want.
After this age comes a stressful period when a child
moves on to the stage of adolescence and experiences
rapid changes in terms of growth, relocation and self
discovery (Newcomb et al., 1981). This stage marks the
development of cognitive and social dimensions within
the adolescents. The adolescents cross this phase and
they get into the stage of young adults who frame their
own lifestyle. Young adults possess greater financial
independence and gain competence in buying complex
consumer products. They are not burdened by
commitments which in turn provide them greater freedom
1
and flexibility. Young consumers go in for the purchase
of a variety of goods and services. The young consumer
group has an immense impact on marketers and
retailers. This generation is known for their love for
shopping (Taylor and Cosenza, 2002).The direct spending
power of youth is estimated to be an astounding 1.3
trillion U.S. dollars (NAS, 2006). The immense love for
shopping and the spending power act as perfect catalysts
that trigger these youngsters to purchase and consume
a wide variety of products existing in the market. Majority
of spending is directed towards entertainment, travel and
food. Young women go in for the purchase of cosmetics,
clothes, beauty products and jewellery whereas young
men prefer jeans, sports items, music gadgets and
motorcycles. They desire to hang out with their friends,
colleagues or relatives to enjoy the life. Among all the
reference groups, friends have the most influence on
youth. Parents also influence them up to some extent.
The youngsters do not merely regard shopping as a
simple act of purchasing. Rather shopping is considered
as a chain of activities comprising of socialization,
discussion and gaining of knowledge regarding newly
launched products and brands, comparison of product
features and price ranges and finally concluding the whole
experience with the purchase of a particular product after
intense scrutiny related to its price, features, utilitarian
and hedonic aspects.
Youngsters exhibit their attachment towards materialistic
values and possession. They are self- conscious and
are always in search of self – identity. The young
generation purchase those products and brands which
express them. They prefer those products which would
ensure them acceptance among their friends and peers.
Digital media has offered a perfect platform for the young
generation to connect with each other, thereby enabling
this generation to explore the world. The preferences of
young consumers change so frequently that it makes it
. Assistant Professor, Department of Management studies, SNGCE
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November 2015
Page 86
even more difficult to identify their needs. The youngsters
are described as hard-to- please consumers (Tran, 2008).
Hard sales and traditional marketing strategies could
be rendered ineffective in influencing the youth. All the
above mentioned facts highlight the unique and
interesting characteristics of young consumers. Hence,
there is a need for conducting continuous research works
focused upon the youth as such efforts would offer
guidelines to marketers and retailers in tailoring their
marketing strategies to effectively target and serve this
young consumers.
Literature review
Studies on consumption behavior of youth
An understanding of consumption behavior of youth could
provide insights for the organizations to target this
segment to market their products/services. Chen –Yu
and Seock (2002) studied the shopping frequency,
expenditure, purchase motivations, information sources
and store selection criteria of American youth in purchase
of cloth. Results revealed that for both genders, friends
were the most important information source and price
was the most important criterion for store selection.
Significant differences were also found between genders.
When impulse and non impulse shoppers were
compared, significant differences were found in all the
clothing behaviours examined in the study.
Kim et al (2003) conducted a study to test whether and
how mall shopping motivations were related to loneliness
and media usage among teen consumers. Mall intercept
method was used to collect data from 531 teens in four
large shopping malls in the United States. It was found
out that mall shopping motivations consisted of five
dimensions: service motivation, economic motivation,
diversion motivation, eating out motivation and social
motivation. The study suggested directions for marketers
and educators to come up with positive programs to
provide social support for teens.
Beaudoin and Lachance (2006) attempted to understand
the interest of youth from Canada in clothing brand names
and to ascertain how different psychological, social and
socioeconomic variables explained variance in their brand
sensitivity. Findings of the study revealed that
susceptibility to peer influence, gender, fashion
innovativeness, consumer competence, self- esteem,
brand importance and age were significantly related to
brand sensitivity. The researchers reported that it was
necessary to extend the investigation to more diverse
geographic populations with different cultures.
Segmentation of consumers could enable the marketers
to formulate clear cut strategies to target different
segments in an effective manner. Goswami (2007)
investigated the psychographic segmentation of college-
Special issue
goers of Kolkata, India based upon the values they felt
were important along with their activities, interests and
opinions (AIO). The findings revealed five groups or
clusters namely – Life loving Go- getters, politically
conscious positivists, Independent minded, Destiny
believing pessimists and Happy go lucky dependents.
The marketers and retailers targeting young consumers
need to understand the motivational factors that drive
this segment to go for shopping. Kaur and Singh (2007)
studied about the motives that drive young people to
shop in departmental stores or malls. The results of the
study revealed that Indian youth primarily shop from a
hedonic perspective. They also viewed shopping as a
means of diversion to alleviate depression or break the
monotony of daily routine. The youth were found to be
serving as new product information seekers, and hence
the authors suggested that retailing firms could directly
frame and communicate the requisite product information
to them.
Penman and McNeill (2007) explored consumption habits
of the young adults from New Zealand as they leave
home and attain fiscal responsibilities. Results showed
that young consumers exhibited a propensity towards
large volumes of non-essential purchasing with a relaxed
attitude towards debt and consumer purchasing.
Consumption of disposable goods such as fashion and
entertainment items were seen as vital to leading a happy,
fulfilled life and the means by which these goods were
accessed was of minor importance. Social pressure was
found to be the key driver of consumption choices in
this group with the majority of spending decisions made
impulsively.
The consumer’s search for information has close
association with their shopping behaviour. Seock and
Bailey (2008) conducted a survey among U.S. college
students to investigate their shopping orientations and
examine the relationships between their shopping
orientations and searches for information about and
purchases of apparel products online. The study
identified seven shopping orientation constructs namely:
shopping enjoyment, brand/fashion consciousness, price
consciousness, shopping confidence, convenience/time
consciousness, in-home shopping tendency and brand/
store loyalty. The results highlighted that participants’
shopping orientations were significantly related to their
searches for information and purchases of apparel items
online.
Youth of the present era is connected to the cyber world
much more than ever. Gupta andGupta (2009) attempted
to study the consumer behavior of urban Indian youth
who use Internet for shopping. The study found out that
urban Indian youth is more an online surfer than an online
November 2015
Page 87
shopper. The researchers noted that only a very small
percentage of Indian youth has started appreciating the
role of Internet in shopping.
Youngsters in the current scenario are increasingly going
in for branded products and services. They prefer brands
which express them. Sahay and Sharma (2010)focused
upon the brand relationships and switching behavior
amongst young consumers for highly used electronic
durable goods. The results indicated that young
consumers do form relationships with brand(s) on six
dimensions of consumer brand relationship namely –
love and passion, self connection, interdependence,
commitment, intimacy and brand partner quality. Peer
influence was found to reduce the brand switching
intentions. Interestingly family influence was found to
be higher than peer influence. While strong brand
relationships reduce switching intentions; they did not
reduce price comparisons owing to the price consciousness
of Indian consumers.
Phau. I and Woo. C (2008) investigated money attitudes
and credit card usage between compulsive and non
compulsive buyers, of young Australians. They attempted
to validate the money attitude scale (MAS) using
Australian sample. Data were collected using a mall
intercept method in a major shopping complex in Perth,
Western Australia. The study found out that compulsive
buyers were more likely to perceive money as a source
of power and prestige. They were also more frequent
users of credit cards and were more likely to bargain
hunt. However, there were no differences between
compulsive and non-compulsive buyers for the
dimensions of time retention, distrust and anxiety of the
money attitude scale.
Dix S. et al. (2010) investigated how sports celebrities
are perceived as role models and how they influenced
young adult consumers’ purchase and behavioral
intentions. The study also examined whether this
influence differed between males and females. It was
found out that athlete role model endorsers have a positive
influence on young adults’ product switching behavior,
complaint behavior, positive word of mouth behavior and
brand loyalty. The study confirmed the assumption that
sports celebrities are important socialization agents and
had significant impact on purchase intentions and
behaviours. The researchers called for further research
works focused upon more diverse and larger samples of
young adults to advance the findings of their study.
Narang R., (2010) conducted a study to understand the
psychographic along with demographic variables of the
youth in India. Based on cluster analysis, four
psychographic clusters were identified: ‘Get- going
Adopter’, ‘Inner value –oriented Conservative’, ‘Political
and Sport enthusiast’ and ‘Independent life lover’. The
Special issue
findings of the study revealed psychographic differences
among the identified clusters.
Research Gap: Chen Yu and Seock (2002) stated that
further studies with larger sample size of young
consumers and random sampling techniques are needed
to provide consistent evidence of generalized findings.
Beaudoin and Lachance (2006) called for future research
works in evaluating the impact of advertising in media
such as Television, magazines or the internet on brand
sensitivity of young consumers. Goswami (2007) stated
that despite of the importance of the youth segment in
India as potential customers, this segment as a separate
area of study has not been adequately pursued. Seock
and Bailey (2008) reported that future studies should
focus upon young consumers from diverse geographical
areas. Narang (2010) reported that further research can
be carried out to identify the products purchased by the
different psychographic segments of youth for their
personal consumption and the frequency of such
purchases. The author also indicated the scope for
researching the store selection criterion adopted by the
different psychographic clusters of the youth in order to
formulate the store retail strategy. Sahay and Sharma
(2010) called for the conduct of further research on youth
consumption behaviour across different product
categories. The authors also suggested to track the
influence of brand relationships on actual customer
purchase behavior.
Conclusion
A report by Ernst and Young (2007-08) reveals that 54%
of the Indians are aged below 25 years. According to
Narang (2010) India has the youngest population profile
in the world. The youth market is significant to Indian
marketers and retailers due to its huge size and spending
power. Unlike in the western countries most of the Indian
youth still depend on their parents while pursuing their
education or they are single with an employed status in
private or Government organizations. In both the cases,
it is found that the youngsters enjoy significant amounts
of disposable income either in the form of pocket money
or in the form of salary. It should also be noted that
these individuals are free from the burden of serious
financial or family commitments unlike their older
counterparts. This lifestyle influences the consumption
pattern of these young consumers who are always on
the lookout for the enjoyment aspects of life. According
to Just India Generation study (2010), for 25% of the
Indian youth, their favorite outdoor entertainment activity
is hanging out with their friends. On the other hand 16%
of the youth like to visit their relatives/neighbors’,
whereas 15 % of them enjoy spending their time
watching movies at cinema hall and for 10% of the youth,
eating out is their favorite outdoor entertainment. Much
November 2015
Page 88
of the retail boom in India could be attributed to the young
consumers. Consumption of items like sports shoes,
apparel and cell phones are rising up because of them
(Ramaswamy and Namakumari, 2009). The young
members within the family often influence family
purchasing decisions (Turk and Norman, 1972). The
youth consumer segment is a relatively more
homogeneous group when used as research subjects.
This is particularly helpful in minimizing random error
that might occur by using a heterogeneous sample such
as the general public (Calder et al., 1981). The likelihood
of error within the measurement model is inflated by
situational factors inherent in diverse samples (e.g. age,
income and social class). This error is reduced when
respondents are homogeneous across demographic and
behavioural characteristics (Assael and Keon, 1982).
The youth are different from their predecessors with regard
to attitudes, language, culture, lifestyle, orientation and
aspirations (Farris et al., 2002). The Indian youth
segment as a separate area of study has not been
adequately pursued. Even though some market research
agencies do carry out surveys on the Indian youth, these
are generally syndicated studies and the methodology,
survey instrument or the technique of statistical analysis
is not available to academic research community (The
Marketing White book, 2005).
•
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Special issue
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November 2015
Page 90
STRATEGIC STUDY OF THE EFFECTS OF PERCEIVED RISKS AND
BENEFITS OF SHOPPING
Dr. Hari Sundar.G1
Dr.D. Sudha Rani Ravindran2
Mr. Ramakrishnan3
Abstract
This study investigates the role of perceived risks and benefits in influencing the consumer's purchase decision
process during online shopping in UK and India. The purpose of this research is 1) to examine the relationship
between consumer's beliefs (British and Indian) regarding online shopping risks and benefits and their attitude
towards online purchase of products, 2) to study the relationship between consumers attitude and intention of online
purchase of products, and 3) to explore differences between British and Indian consumers in terms of the perceived
benefits and risks towards online shopping. The study revealed support for the significant relationships for both
Indian and British consumers between perceived risks and benefits and attitude towards online shopping. Significant
differences in perceived risks and benefits associated with Internet shopping between Indian and British consumers
were also observed. While Indian consumers perceived more risks than British consumers the benefits of Internet
shopping perceived by Indians were found to be significantly less.
Key words: Words: Risks, Benefits, British, Indian, Online Shopping, Attitude.
Introduction
Internet as one of the most successful innovations has
shown tremendous growth in both its applications and
number of users. Its unique characteristics of flexibility,
interactivity, and personalization have provided enormous
opportunities for innovative business strategies. One
unique and revolutionary transformation brought forward
by the Internet, “online shopping “, has become a source
of increasing competition to the traditional shopping
channels, such as retail stores, mail stores catalogues
especially those associated with product areas of books
and music.
Online shopping has cannibalized into the in-store
shopping as consumers are becoming more familiar with
online shopping and in many cases are giving preference
to online shopping(“Malls going to walls”, 2010). While
the traditional “brick and mortar” stores have the
drawbacks of limited time and space where the
customers need to reach the product, the Internet has
decreased the time and efforts consumer spend in
shopping, by providing a concept of boundary-less stores
where the product reaches the consumers (Bhatnagar,
Misra and Rao, 2000). Further Internet makes an
unlimited range of products and services available to the
consumers (Bhatnagar and Ghose, 2004, Forsythe and
Shi, 2003) and people can buy and sell anything,
anywhere at any time.
For this reason Saimee (2001) declared Internet to be
“one of the most significant and perhaps the greatest
marketing tools for the global marketing place”.
Background
In spite of the considerable and optimistic growth of online
shopping, the use of Internet for shopping is a widely
varied phenomenon. While the online shopping is
booming in the western world especially in countries
like UK, USA, it has not seen such a growth in countries
like China, India etc. The US is the leading e-commerce
economy with online sales of $176.2 billion which are
expected to reach $278.9 billion in 2015 (Mulpuru, 2011).
In Europe the number of online buyers is expected to
grow from 157 million to 205 million and total sales all
forecasted to reach $190 billion by 2015. While people
in countries like Korea spend more time online and China
has the most number of online users, China's online
market however stood only at $49 million in 2010
(Wigder,2010).
The major reason for people not adopting online shopping
has been connected with the perceived risks which people
associate with it (Bhatnagar et al., 2000; Forsythe et
al., 2006; Torkzadeh and Dillion, 2002), while the
significant benefits which online shopping medium offers,
which are not available in traditional shopping have been
attributed towards adoption of online shopping medium
(Alba, Weitz. Janiszewski, Lutz and Wood, 1997;
Bhatnagar and hose. 2004; Bhatnagar et al., 2006,
Forsythe and Shi, 2003; Hoffman and Novak, 1996).
Majority of researches on online shopping behavior have
explored the role of perceived risks and benefits at the
individual level but very few studies have been conducted
at country level. Some of the early researchers found
1
. Associate Professor- SNGCE, Kolenchery, Kerala
. PSG IM, Coimbatore.
3
. Doctoral Scholar, Michigan University
2
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November 2015
Page 91
that Internet users throughout world are similar (Quelch
and Klein, 1996) and perceive similar benefits and risks
toward online shopping, but later studies have
increasingly pointed out to differences in perceived
benefits and risks, Internet innovativeness across different
countries (Park and Jun, 2003). Nonetheless, a cross
country research on perceived risks and benefits of online
shopping behavior has been an underdeveloped field of
study
In this study UK was selected for a comparative analysis
with India because enormous differences in e-commerce
figures between the two countries provide a critical
environment to do a cross-country study. In UK e-retailing
has shown tremendous growth with Internet sales being
expected to grow year on year basis by 6% over the
coming six years and online sector expected to break $
92 billion mark in 2014 (Thomson, 2009), however in
India with its 60 million users of Internet -which however
represents only 12% of the population, e-commerce
figure stands out just $ 51 million as against the total
retail industry of $410 million.
As it is estimated India would have the third largest
number of Internet users by 2013 (Times of India, 2010),
it becomes more important for marketers and businesses
to find out whether the perceived benefits and risks
associated with online shopping are same which people
associate with online shopping in countries like UK. As
e-commerce offers one of the biggest channels for doing
business in future, it is imperative that both national and
international marketers and businesses must have a
complete understanding of the factors which will
encourage online shopping by the Indian consumers
Literature Review
Perceived Risks
Internet stores are free from physical boundaries and
allow consumers to shop from remote locations
(Bhatnagar et al, 2000), however people are apprehensive
of buying on the Internet due to perceived risks
associated with online shopping (Bhatnagar et al, 2000;
Fram and Grandy, 1997). Researchers have identified
various risks associated with online shopping behavior:
financial, product performance, psychological, physical
and time/ convenience loss. Furthermore components
such as privacy and security loss risk (Jarvenpaa and
Todd, 1996; Vijayasarthy, 2004) and source risk
(Torkzadeh and Dillion, 2002) have been associated with
online shopping. A table of comparison of prior studies
associated with perceived risks associated with online
line shopping is given in Table 1.
Financial risk in online context is related to the risk of
losing money in online transactions by providing credit
card or bank account information over the Internet (Fram
Special issue
and Grady, 1997; Lee, Park, and Ahn, 2001). Financial
risk is more commonly associated with Internet
shopping than with in-store shopping (Bhatnagar et al.,
2000) because credit card fraud is a major concern to
online consumers (Lee et al., 2001). Researchers also
have attributed financial risk associated with online
shopping to the lack of trust in the retailer and fear of
purchasing wrong products by mistake, not receiving
the purchased product and credit card being overcharged
(Forsythe et al., 2006).
Financial risk may, however, be reduced with increased
shopping experience on the Internet as the consumer
acquires more knowledge about the e-retailer (Bhatnagar
et al., 2000). Product performance risk in context of
online shopping has been associated with the risk that
the product may not function as expected (Bhatnagar et
al, 2000; Jarvenpaa and Todd, 1997; Tan, 1999;
Vijayasarthy and Jones 2000; Forsythe et al 2006;
Torkzadeh and Dillion, 2002) and the feeling of not being
able to return the product if it fails to meet the expected
parameters (Jarvenpaa and Todd. 199”. Vijayasarthy and
Jones, 2000). The issue of not being able to touch and
feel the product (Bhatnagar et al 2000: Forsythe et al,
2006; Torkzadeh and Dillion. 2002) and physically not
being able to examine the product increases the risks.
The level of product performance risks have been identified
with the type of objects; where books and software which
are more standardized are associated as low risks
products (Bhatnagar et al, 2000) products like fashion
goods; where touch and feel are considered important
before purchase are considered as high risks. The
apprehensions of the consumer in sharing his personal
information and credit card information while shopping
online has been classified as privacy and security risk.
The possibility of credit card fraud is one of the common
risks associated with online shopping (Bhatnagar et al.,
2000; Jarvenpaa and Todd, 1997; Vijayasarthy and Jones,
2000). The fear of misuse of personal information
(Jarvenpaa and Todd, 1996) or the apprehension of
personal information being passed on to third parties by
the shopping websites, risks of card details being stolen
during the transaction (Lim, 2003) add to the perceived
risks of online shopping. The loss of time and
inconvenience faced by consumer in navigating and
browsing for placing an order and/ or find appropriate
websites or loss of time because of slow download speed
of WebPages (Forsythe et al., 2006) has been identified
as one of the risks associated with online shopping.
Apprehensions of possible delays in the delivery of
purchased items from online store are a concern for
some online shoppers. Time loss has also been related
with time lost in returning and exchanging goods which
do not meet expectation or do not fulfill desired criteria
or have been delivered which don't match the
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specifications of the products ordered. The perceived psychological risk in the online context has been referred to
disappointment frustration and shame experienced if one's personal information is disclosed (Forsythe and Shi,
2003). The frustration of answering questions like filling of personal information which websites ask for prior to
completion of transaction increases the psychological risks. Perceived psychological risk reflects concern about
the psychological discomfort and tension that may arise because of making a transaction (Hassan et al., 2006).
The more difficult to find the identity of the trader and that reputable vendors are more likely to commit good behavior
and hence tend to reduce the perceived source risks (Resnick et al., 2000). Reputation signals the trustworthiness
of the seller and consumer sees lesser of risks of buying products from those websites which are reputable (Resnick
et al., 2000). A positive reputation is inferred as the trustworthiness of the selling party.
Table - 1 : Dimensions of Perceived Risk in the Literature
Risk
Conceptual Definition
Traditional Shopping
Context
Online Shopping Context
Financial Risk
Risk related to loss of
money
Derbaix (1983); Horton
(1916)
Lee, Park and Ahn (2001); Fram and
Grady (1997); Forsthye and Shi
(2003); Torkzadeh and Dillion (2002);
Sweeney, Soutor, and Johnson
(1999)
Product
Performance Risk
Risk related to the
fundamental as pect of the
product
Festervand, Synder,
Tsalikis (1986); Horton
(1976); Jacoby and
Kaplan (1972); Spence,
En-gel, Black well (1970)
Simpson and Lakner (1993); Fram
and Grady (1997); Torkzadeh and
Dillion
(2002); Forsythe et al. (2006)
Psychological risk
Risk related to the
dissatisfaction ad mental
stress caused due to
purchase
Jacoby and Kaplan
(1972)
Time loss risk
Risk related time-lost in the
buying or retaining the
product
RoseIius(1971);
McClorke (1990)
Privacy Security risk
Risk related to the credit
card and personal
information being stolen
Benassi 1999); Bhatnagar et al.
(2000); Miyazaki and Frenandez
(2001); Ja-vemppa and Todd (1996);
Vijayasarthy (2004)
Source risk
Risk related to the
existence of the
Torkzadeh and Dillion (20G2)
Perceived Benefits
In contrast to offline/ physical shopping, Internet
shopping represents relative new way of shopping. Alba
et al. (1997) classified access to selection as one of
the primary motivations/ benefits consumers associate
with online shopping. Convenience, information,
customization, (Ghosh, 1998) and time efficiency
(Morganoskyand Cude, 2000; Verhoef and Langerak,
2001) have been identified as the primary factors of online
shopping. While Keeney (1999) identified ten
fundamental values of motivation for shopping online out
of which nine were related to utilization motives, very
few researches have been done to identify hedonic
motivation in online shopping.
While Internet shopping provides service which is not
limited by time, space, and weather (Burke, 1997),
Special issue
Forsythe et al. (2006); forsythe and
Shi (2003)
convenience due to the time and effort saved by shopping
from one's own place rather than visiting physical stores
has been suggested by various researchers (Bhatnagar
and Ghosh, 2004; Forsythe et al, 2006; Eastlick and
Feinberg, 1999) as perceived benefits of online shopping.
Online shopping is also associated with hassle-free
shopping i.e. it helps consumers at their convenience
without any shame for not buying anything and just
browsing the products (Forsythe et al, 2006). Further
online shopping has been related to low cost and savings,
as consumers are able to get same quality products at
a lower cost due to the cost saved on rent, store
installation, decoration which are generally borne by the
owners of the retail stores and are passed on to the
consumers (Miller, 2000).
Online shopping enables consumers to acquire large
amount of information about product specifications,
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stores, promotion etc. (Wolfinbarger and Gilly, 2001). Online shopping empowers consumers to access review and
use the information in an easy and effortless manner when compared with traditional "brick and mortar" retail stores
(Alba et al, 1997; Lynch and Ariely, 2000). Consumers can receive abundant information from the website directly
rather than from the salesperson (Van den Poel and Leunis 1999) with a few clicks of the mouse.
The hedonic motive to seek pleasure and enjoyment by experiencing new things while shopping online (Forsythe et
al., 2006) has also been associated with benefits of online shopping. As consumers browse through the wide
variety of products on the Internet, they can also obtain competitive prices on merchandise and eye-catching
promotional deals (Jarvenppa and Todd, 1996). Online shopping provides consumers with the flexibility to select
and evaluate merchandise across stores. The broad selection of products from different brands and retailers with
detailed information available may be viewed as a significant benefit of online shopping helping the consumer's
decision-making, which is likely to provide an important motive for online shopping (Forsythe et al., 2006; Menon
and Kahn, 1995).
Research Hypothesis and Questions
The Theory of Reasoned Action (TRA) (Ajzen and Fishbein, 1980) serves as the theoretical framework of this study.
In the present study, the belief-attitude-behavioural intention link postulated by TRA was used to predict both Indian
and British consumer's attitude and purchase intention towards online purchase through their beliefs regarding
risks and benefits they hold in their mind. According to the theoretical framework presented in Figure 1, consumer's
beliefs such as their perceived risks and benefits associated with online apparel shopping are conceptualized as
possible antecedents of the consumer's attitude towards purchasing products online, which in turn determines their
online purchase intentions for products. Therefore, based on this conceptual framework, the following hypotheses
were developed.
HI : Perceived risks are negatively related to attitude towards online shopping of consumers (India and UK).
H2 : Perceived benefits are positively related to attitude towards online shopping of consumers (India and UK).
H3 : Attitude towards online shopping is related to consumer's (India and UK) online buying intention.
Lastly the research focused on bringing out differences in perceived risks and benefits towards online shopping. For
this part the following exploratory research question was developed.
RQ1: Are there any significant differences in perceived risks, benefits towards online shopping between Indian and
British consumers?
Belief
Attitude
Intension
Perceived risk of
online shopping
H1
Attitude towards
online shopping
H3
Online purchase
intension of
products
Perceived benefit
of online shopping
H1
N.B Each of die hypothesis and research question was tested separately for UK. and Indian consumers. RQI not
N.B Each of die hypothesis and research question was tested separately for UK. and Indian consumers. RQI not
included in this figure. RQ1 addressed the differences between perceived risks and benefits of UK and Indian online
shoppers (based on TRA. Ajzen and Fishbein. 1980)
Both online and mail based survey methods were used for data collection The guidelines for conducting the survey
were adapted from Dillman (2000) and for UK data, a self administered questionnaire was distributed among 200
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November 2015
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shoppers at supermarkets like Asda. Sainsbury, Aldi,
Taj located in Brighton. An online survey link was also
created and the link was mailed to people known to the
researcher.
For collecting data in India an online questionnaire was
developed and an e-mail was sent to 200 respondents
known to researcher, asking them to visit online site
(www.qualtrics.com). Prior to collection of data a pilot
study was conducted to test and identify any flaws in
the survey format and to ensure validity and reliability of
measures. A convenience sample size of 15 friends, who
had access to the Internet and had used Internet for
online shopping, was used for UK and India. On the basis
of feedback the necessary correction and refinement of
the questionnaire were done.
Questionnaire Design
For the study, a self administered questionnaire was
designed, using scales developed from previous
researches (Appendix A.l). The questionnaire consisted
of six parts; the first part was related to people's familiarity
with use of Internet while the second and third sections
related to the perceived risks and benefits of online
shopping. The fourth and the last section addressed the
attitude, purchase intention, and demographic
parameters of the respondents respectively.
The first section included general questions related to
length of Internet use, duration of Internet usage, and
purpose of using Internet. The second section of the
questionnaire was related to risks perceived with online
shopping behavior and 15 items were used from existing
literature such as Forsythe et al. (2006) and Torkzadeh
and Dillion (2002). The items consisted of constructs
such as financial risks, example “My credit card number
may not be secure”, time/convenience risk, example “It's
difficult to find out appropriate website", and product risk,
example”/ am not able to touch and feel the item”. The
items were again rated on a 5 point Linker Scale with 1
being strongly disagree and 5 strongly agree.
For benefits related to online shopping items from existing
literature, Forsythe et al. (2006) and Ramus and Nielsen
(2005) were used. The items addressed construct of
online shopping benefits such as, shopping convenience,
example”/ can shop in the privacy of my home”. Product
selection, “Items from everywhere are available”, ease/
comfort of shopping example “I won t be embarrassed
even if I don't buy" and hedonic/enjoyment example
“Internet shops make shopping fun” were used.
In the third section attitude towards buying products
online was measured using 5 point semantic differential
scale consisting of three pairs of bipolar descriptive “BadGood”, “Unpleasant-Pleasant”,“Unfavourable-
Special issue
Favourable”and an incomplete sentence”,/buying
products from the Internet”, which were adopted from
items used to measure attitude construct by Anand and
Sternthal (1990), Gill, Gossbarth and Laczniak( 1998),
Holbrook and Batra (1987) and MacKenzie and Lutz
(1988). Further intention of buying through Internet was
also measured using five point semantic differentials item
consisting of three bi-polar descriptive: “Unlikely –Likely”.
“Improbable-Probable” and “Impossible –Possible”. The
bipolar descriptors were adopted from existing literature
used to measure purchase intension such as
Chattopadhyay and Basu (1990); Lim. Darley and
Summers (1994); MacKenzie, Lutz and Belch (1986).
As with the existing literature a higher point indicated a
more positive response.
The last section consisted of demographic information
with items such as gender, age, occupation, and country
of residence.
Data Source
For UK based survey 93 of the distributed questionnaires
were returned while 15 responses were collected online.
Among the 93 returned questionnaires 4 were excluded
from data analysis as 80% of the questions in them
were unanswered. Thus an overall 104 usable responses
were collected by means of both mail survey and online
link. UK sample consisted of 45.7 % males and 52.4%
females. 28.6% of the respondents in age group 16-25
yrs formed the largest group. Similarly 30.8% of the
respondents were working full time and represented the
biggest category.
An overwhelming 88.5 % respondents had been using
Internet for more than 5 years whereas most of the
respondents where using Internet for more than 5 hours
per week.
Amongst the respondents checking e-mail was the most
frequent reason for using the Internet while 82.7 % of
the respondents had shopped online.
For India based survey 110 people responded by filling
up the online survey set up on www.qualtrics.com.
Among the 110 responses 13 were excluded from the
data as around 80% of the data was missing in them.
The sample consisted of 64.9 % males and 27.8 %
females, 54.6% of the respondents were working full time
and represented the biggest group in income category.
88.5% respondents had been using Internet for more
than 5 years, while 82.5% of the respondents where
using Internet for more than 5 hours per week. While
checking e-mail was the most frequent reason for using
the Internet with 94.8% of the respondents agreeing with
the statement, only 47.4% of the sample surveyed had
shopped online.
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Results
As perceived risks and benefits have multiple dimensions, a multiple regression was performed for testing hypothesis
HI and H2 whereas attitude towards online shopping and innovativeness had only one dimension and hence a
simple regression was performed for H3. Ore way analysis of variance (ANOVA) was used for RQ1 to find out
whether any significant difference exists between perceived benefits and risks towards online shopping between
British and Indian consumers.
Construct Validity and Reliability
To test the reliability and dimensionality of the perceived benefits and risks, exploratory factory analysis and internal
consistency tests were employed for both samples sets of data separately. The factor analysis for both sets of data
produced four factors for perceived benefits (Shopping convenience, Product selection, Ease and Comfort and
Hedonic/Enjoyment benefit) solution for both the data sets .Owing to high cross loading 4 items out of the 19 items
were eliminated (“I can find special products not available elsewhere” and “I won't be embarrassed even if I don't
buy”, “It is exciting to receive a package” and “I can try new experience”). Internal consistency of the factor was also
calculated as shown in Table 2 a and b.
Similarly exploratory factor analysis for both sample sets produced 4 factor (time convenience/ financial/ privacy/
product and channel risks) solution for both data sets, as 4 items out of the 19 items were eliminated owing to high
cross loading across multiple factors (I can’t trust the online company. I may purchase something by accident. I
might be overcharged. It is difficult to return the product.)
Each factor was examined for mutual consistency and mean scores were calculated for each factor as shown in
Table 3 a and b.
Hypothesis Testing
The relationships proposed in the hypotheses and research questions were tested by performing a series of regression
analysis to identify and explain independent variables variances on the dependent variable.
Table - 2a : Factor Analysis for Perceived Benefits (UK Sample)
Factors
Items
Shopping
Convenience
a = 0.86
M = 4.2I
I don't have to leave home
.897
1 can shop whenever I want
.856
I can shop in privacy of home
.823
I can save the effort of visiting stores
.656
1 can avoid the hassle of driving and parking
.610
Product
Selection
a = 0.80
M = 4.01
Items from everywhere are available
.757
I can get good product information online
.752
1 can get a broader selection of products
.712
1 can access many brands and retailers
.681
1 don't have to wait to be served
Ease and
Comfort
a = 0.82
M = 3.88
.739
1 don't get any busy signal
.529
.633
I don't have to deal with pushy salesperson on Internet
.492
.620
Internet shops make shopping fun
.806
I can buy in impulse in response to ads
-.460
I can custom-design product.
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Hedonic/
Enjoyment
a = 0.71
M = 2.82
.796
.756
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Table - 2b : Factor Analysis for Perceived Benefits (India Sample)
Items
Factors
Shopping
Convenience
a =0.885
M=3.75
I don't have to leave home.
Product
Selection
a=0.82
M=3.58
Hedonic
benefit a
=0.78
M=i.20
Ease and
Comfort
a=0.81
M=3.61
.827
(B)I can shop in privacy of home.
.796
I can save the effort of visiting stores.
.795
I can avoid the hassle of driving and parking.
.754
I can shop whenever I want
.721
.426
I can get good product information online.
.796
I can get a broader selection of products.
.774
I can access many brands and retailers.
.750
Items from everywhere are available.
.717
I can buy in impulse in response to ads.
.816
Internet shops make shopping fun.
.799
I can custom-design products.
.758
I don’t get any busy signal
.874
I don’t have to deal with busy salesperson on Internet
.743
I don’t have to wait to be served
.431
Figure - 2 : Regression Results for UK Respondents (Perceived Risks, Benefits,
Attitude and Purchase Intensiona)
Time/Conv
Risk
Finan/Privacy
Risk
Chanel Risk
Product Risk
-0.43***
Attitude
0.63****
*
0.22*
Ease/Comfort
Benefit
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Product Select
Benefit
Purchase
Intension
0.21*
Convenient
Medium
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Hedonic
Benefit
***p < 0.001
** p < 0.01
*< 0.05
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Table - 3a : Factor Analysis for Perceived Risks (UK Sample)
Factors
Items
Time/Conve Financial/Pri
nience Risk
vacy Risk
a=0.83
a =0.71
M=2.26
M=2.90
It is too complicated to place order
.890
It is difficult to find appropriate websites
.834
Pictures take too long to come up
.676
I may not get the product
.856
I may not get what I want.
.736
My credit card number may not be secure
.614
My personal information may not be kept
.380
Product
risk
a =0.73
M=4.13
Channel Risk
a =0.70
M=3.6S
.406
I can't examine the actual product.
.867
I am not able to touch and feel the item
.809
I must pay for shopping and handling
.837
I must wait for merchandise to be delivered.
.831
Table - 3b : Factor Analysis for Perceived Risks (India Sample)
Factors
Items
Financial/pri Time/conveni
vacy risk
ence risk
a =0.81
a =0.76
M=3.31
M=2.S4
My credit card number may not be secure.
.837
My personal information may not be kept.
.741
(R)I may not get the product
.736
1 may not get what I want.
.699
It is too complicated to place order
.828
It is difficult to find appropriate websites.
.819
Pictures take too long to come up.
.755
Product
risk
a =0.90
M=4.14
I am not able to touch and feel the item.
.928
I can't examine the actual product
.883
Channel risk a
=0.73 M=3.S
I must wait for merchandise to be delivered.
.872
I must pay for shopping and handling.
.852
H1 : Perceived risks are negatively related to attitude towards online shopping of consumers.
A multiple regression showed a partial direct influence of perceived risks and attitude towards online shopping for
both UK (R2 = 0.242. p <0.001) and Indian sample (R2 = 0.09 p <0.01). Financial/privacy risk showed a negative
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influence on attitude for both the UK (B = -0.431, t = -4.878, p < 0.001) and Indian sample (P = -0.28, t= -2.86,
p < 0.01)as shown in Table 4 a and b.
Table - 4(a) : Influence of Perceived Risks on Attitude towards on Line Shopping (UK)
Model B
1
Unstandardized Coefficients
Standardized
Coefficients
r
Sig.
-.191
.849
Std. Error
Beta
(CONSTANT)
-.017
.088
TIME CONVENIENCE RISK
-.162
.090
-.160
-1.804
.074
FINANCIAL PRIVACY RISK
-.429
.088
-.431
-4.878
.000
PRODUCT RISK
-.076
.088
-.076
-.856
.394
CHANNEL RISK
.167
.091
.163
1.839
.069
DEPENDENT VARIABLE: ATTITUDE R2 = 0.242, P = 0.000
Table - 4(b) : Influence of Perceived Risks on Attitude Towards on Line Shopping (India)
Model B
1
(CONSTANT)
Std Error
Beta
-.016
.100
-.285
FINANCIAL PRIVACY RISK
.100
-.183
TIME CONVENIENCE RISK
PRODUCT RISK
-.136
CHANNEL RISK
.030
.102
.101
.101
Standardized
Coefficients
t
Sig.
-.163
.871
-.289
-2.862
.005
-.182
-1.800
.075
-.136
-1.349
.181
.030
.295
.769
2
DEPENDENT VARIABLE: ATTITUDE R = 0.09, P = 0.01
H2 : Perceived benefits are positively related to attitude towards online shopping of consumer.
The results of multiple regression analysis (R2 = 0.34, p < 0.001)support that all perceived benefits of online
shopping: Shopping/convenience benefit (r = 0.22, p =0.01), Product selection benefit (r = 0.37, p = 0.01), Ease/
Comfort benefit (r = 0.235, p = 0.05) and Hedonic benefit (r = 0.306, p = 0.01) are positively related to attitude
towards online shopping for the UK sample while for the Indian sample perceived benefit on attitude towards online
shopping was partially supported (R2 = 0.10, p < 0.05) and only Shopping convenience (β= 0.22, p < 0.05) and
Hedonic benefits β= 0.22, p < 0.05) showed positive influence on attitude towards online shopping. (Table 5 a and b).
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Table - 5a : influence of Perceived Benefits on Attitude towards on Line Shopping (UK)
Table - 5b : Influence of Perceived Benefits on Attitude towards on Line Shopping (India)
H3 : Consumer's positive attitude towards online shopping can lead to online buying intention of products.
Both British (β = 0.63, R2 =0.04, p <0.001) and Indian consumer's (β = 0.646, R2 = 0.417, p < 0.01) attitude towards
online shopping as predicator of their intention to purchase online was supported as shown in Table 6 a and b.
Table - 6a : Relationship between Attitude and Online Buying Intension (UK)
Model B
1
Un-standardized Coefficients
Std. Error
Beta
(Constant)
.000
.076
attitude
.635
.077
Standardized
Coefficients
.635
t
Sig.
.000
1.000
8.265
.000
2
Dependent Variable: Buying intension R = 0.403, p = 0.000
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Table - 6b : Relationship between Attitude and Online buying Intension (India)
Model B
1
Un- standardized Coefficients
Std. Error
Beta
(Constant)
000
.081
attitude
646
.081
Dependent Variable: intension to buy
Standardized
Coefficients
.646
t
Sig.
.000
1.000
7.930
.000
2
R - 0.417, p = 0.000
RQ 1 : Are there significant differences in perceived risks, benefits towards online shopping between consumers in
India and UK?
No statistically significant differences were found in the overall perceived risks of UK and Indian respondents.
However Indian online shoppers felt a higher level of perceived risks in terms of financial/privacy risk and time/
convenience risk than their UK counterparts (Table 7).
UK respondents perceived significantly higher overall benefits of online shopping as compared to the Indian
counterparts. While UK online shoppers felt significantly higher level of perceived benefits of online shopping in
terms of shopping/ convenience benefits and product selection benefits, Indian online shopper felt significantly
higher hedonic benefits (Table 8).
Table - 7 : Perceived Risks of Online Shopping between UK and Indian Respondents
Total
respondents
(N=201)
t-test for Equality of Means
UK Respondents
Indian
(N=I04)
Respondents
(N=97)
t
df
iSig. (2-tailed)
Perceived Risk Index
3.34
3.23
3.45
0.119
196
N.S
Financial/ privacy risk
3.10
2.90
3.31
-3.672
196
.000
Time /convenience risk
2.55
2.26
2.85
3.699
196
.000
Product risk
4.13
4.13
4.14
1.465
196
N.S
Channel risk
•57
3.64
3.5
1.115
196
N.S
-
A 5 pt Linker scale was used to measure each item of the above constructs ranging from 1 (strongly disagree) to 5
(strongly agree) with 5 representing the highest perceived risk.
Table - 8 : Perceived Benefits of Online Shopping between UK and Indian Respondents
Total responUK
dents
Respondents
(N=201)
(N-104)
Indian
Respondents
(N=97)
t-test for Equality of Means
t
df
Sig. (2-tailed)
Perceived Benefit Index
3.64
3.74
3.56
3.501
196
.001
Shopping convenience benefit
3.99
4.22
3.76
3.923
196
.000
Product selection benefit
3.79
4.01
3.58
3.488
196
.001
Ease and comfort benefit
3.78
3.88
3.69
1.366
196
N.S
Hedonic benefit
3.01
2.82
3.21
-4.760
196
.000
Special issue
November 2015
Page 101
A 5 pt Likert scale was used to measure each item of
the above constructs ranging from 1 (strongly disagree)
to 5 (strongly agree) with 5 representing the highest
perceived risk
Summary
The research was conducted to understand perception
of risks and benefits which consumers associated with
online shopping in India and UK The findings lend support
to the fact that online shopping is still viewed as risky
proportion instead of its substantial benefits. The findings
also reveal that with increased usage of Internet for online
shopping (75% of the British respondents had shopped
online as compared to 46% of the Indian respondents),
the consumers appreciate the benefits of online shopping
more.
In our study Indian consumers showed higher perceived
risks in all the four constructs, however only two
constructs, financial/privacy and time/convenience risks
were significantly higher. This implies that Indian
consumers perceived higher risks towards online
shopping as compared to UK counterparts. In case of
perceived benefits Indian consumers assigned
significantly higher value for hedonic dimension than UK
counterparts, however in terms of shopping and product
selection benefits, British consumers had significantly
more positive view of the online shopping benefits.
Implications
As in the previous researches (Bhatnagar et al., 2000;
Jarvenpaa and Todd 1997; Jones and Vijayasarthy, 2000),
this study also identifies that trust and security are the
big concerns which impede online shopping. The study
also points out that though same risks (financial/
security, product risk) are perceived by both British and
Indian consumers, the online sales are $42 billion as
compared to Indian figure of 51 million (Forrester, 2010).It
thus is important for marketers to develop a strategy for
enhancing benefits of online shopping rather than only
laying stress on improving security of e- commerce in
the Indian context.
The study also brings out the observation that the Indian
Internet users do not feel that the medium offers variety
and easy access to the wide range of merchandise,
thus an important remedy to increase e- consumer base
will be to provide users with online product variety to
match the variety available in retail stores such that it
leaves Indian consumers with no reason to turn to the
"brick and mortar shops". The study also points out that
while the UK respondents agreed that Internet offered
greater product information like prices, than in-store
prices, Indian respondents did not feel the same. This
can be related to the fact that in nations like UK various
discounts are offered for online buyers and generally
Special issue
consumers turn to Internet in search of cheaper goods.
Popular brands also offer the facility of installments thus
enabling the middle class to afford branded merchandize.
As such provisions are absent in the Indian online
market, the provision of such features by marketers will
help to attract Indian consumers to online shopping.
Since Indian consumer does not significantly recognize
time/convenience benefit associated with online
shopping, Indian marketers/managers should focus on
making website easier and user friendly and should look
to reduce the user website navigation time by not asking
information (e.g. personal details) which are not important
The findings that Indians use Internet for the purpose of
social interaction/networking (88%) greater than UK
counterparts (77.9%) imply that Internet marketers need
to encourage Indian Internet users to become the Internet
buyers. Internet marketers should develop marketing
strategies which lead Indian consumers from
communities of fantasy, relationship and interest toward
communities of transactions (Armstrong and Hagel,
1996).
Further as also observed by Taylor et al., (1997) the
study also points out to the fact that cultural differences
lead to differences in internet usage particularly relating
to online shopping. In other words, people from different
cultures have different motivations for shopping online
and show different preference for certain product at online
stores. Therefore it is suggested that Internet marketers
should consider cultural differences in their global
marketing websites when dealing with consumers all
over the world.
Limitations and Further Research
This study has some limitations which need to be taken
into consideration while understanding the findings. First
and the most important limitation of the study is it's
statistical limitation. A linear regression analysis was
used to test each of the hypothesis and research
questions which obviously had led to shortcoming of the
research not being able to explore the structural
relationship among variables. A structural equation model
(SEM) is needed to attempt to identify the exact causal
relationship among variables. Future researchers should
use SEM model to test the hypotheses and research
questions to understand the structural relations among
the variables.
Due to limitations of time and budget, the sample sizes
(India and UK) were kept small and an elaborate and
detailed research could not be carried out. To remove
any discrepancies which might have arisen due to these
limitations, it is suggested that future research should
increase the sample size and also look at the wider
spectrum of the society.
November 2015
Page 102
Secondly, only limited variables namely perceived risk
and benefits were considered during the research. The
influence of demographic and personal variables such
as gender, life style, occupation, income, perceived
social support on attitude towards online shopping was
omitted. Further research could examine the relationship
of these variables on online shopping behavior.
Thirdly, the study doesn't look at the influence of product
categories on attitude towards online shopping. As some
of the pervious researchers have shown (Kargonkar,
Girard, Silverblatt, 2003) purchase preferences for online
shopping significantly differ by product category, further
research can look into that dimension also.
•
•
•
•
Fourthly, the research doesn't look at the relationship
between Internet usage and buying behavior.
•
Lastly, the research is based on exploring country based
online shopping differences and does not consider effect
of cultural dimensions such as power distance,
uncertainty avoidance, individualism / collectivism and
masculinity/ femininity (Hofstede, 1984), on online
shopping behavior. Therefore, future research may
consider the effects of such variables also.
•
In spite of its limitations, the study is an exploratory
attempt to examine differences in perceived risks, and
benefits associated with online shopping between two
cultures/countries. A growing understanding of the above
relationships will hopefully serve to make Internet more
user friendly, easy to understand and viable global
shopping medium in the future.
•
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Page 104
AN EXPLORATORY STUDY ON ROAD RAGE AND ITS DEGREE OF
PREVALENCE IN COCHIN CITY
Dr. Jacob Mathew Pulikotil
1
Mr. Jithin Benedict2
Abstract
Cochin is one of the buzzing hubs of south India. The port city has been developing for the past decade commercially
and geographically. Cochin is no longer known as a port city. Smart city, Vallarpadam container terminal, international
transshipment hub, big malls more over advent of metro rail is paving way to greater footfall to this city. On this
juncture we also witness roads of Cochin rattling and snarling with exorbitantly high traffic. Peak Office hours often
witness huge traffic jams and endless honking, showering of bad words and at times chaotic. Reckless driving and
speedy over takings are giving signs of road rage in the city. Road rage is aggressive or angry behavior by a driver of
an automobile or other road vehicle. The cases of road rage are reported in major cities and off late in Delhi. This is
an exploratory study to understand whether there is a presence of road rage in Cochin and if so the degree of its
prevalence.
Introduction
Bus crew booked for road rage
In yet another instance of `road rage’, the employees of
a private bus broke the windscreen of premium car near
Company paddi junction, Aluva on the National Highway
47 here on Saturday. The incident took place at around
11.30 a.m. when employees of the bus ‘Concord’, plying
on the Aluva-Ernakulam route had an altercation with
Ajeesh Gopi, the car owner. “The car, driven by Ajeesh’s
wife, overtook the bus when it halted at a bus stop. Since
then, the driver of the bus was honking and flashing light
to overtake the car but owing to the bad condition of the
road, the driver could not give side to the other vehicle’’,
said police. Before reaching Muttom, the bus overtook
the car through the left and the car overtook the bus
again when it halted at a bus stop. The indiscriminate
honking resumed as soon as the car overtook the bus
and the bus driver managed to overtake the car and
stopped it. “Soon, the bus crew rushed towards the car
and hurled abuses at the car passengers. In a fit of rage,
they also broke the right side of the windscreen by hitting
with a stone without any provocation”, police said. The
woman who had been driving the car was taken to a
hospital with high blood pressure. A case has been
registered against the driver and conductor of the bus
for damaging the windscreen and verbally abusing the
woman and her husband.
- The Hindu 23rdAugust, 2015
On a normal day while we travel to our work stations
and back, we encounter many vehicles and people in
transit. Some who obey the road rules and respect each
other’s time and schedule. Some others snarling and
honking triggering irritation and yet others in a busy mice
1
2
race zoom their motorcycles and cars on roads, giving
others a spine chilling awe. Road rage is a common
phenomenon in today’s society due to motorists’
frustrations during heavy traffic volumes. ‘Road rage’ is
aggressive or angry behavior by a driver of an automobile
or other motor vehicle. Such behavior might include rude
gestures, verbal insults, deliberately driving in an unsafe
or threatening manner, or making threats. The most
serious forms of road rage is when people indulge in
physical fight, altercations, assaults, and collisions which
result in injuries and even deaths.
Road rage increases crime rates the in form of arguments
and assaults ending up in injury and even death. Risky
driving is one of the most common causes of road traffic
accidents.
The prevalence of Road Traffic Accidents (RTA) has been
increasing drastically every year. It is estimated that,
by 2020, road traffic disability-adjusted life years lost
will move from being the 9thto the 3rdleading cause in
the world and 2ndleading cause in developing countries
(OIJMS, 2015). According to WHO, RTAs are the sixth
leading cause for hospitalization, disabilities, death, and
economic losses in India.
Factors which can lead to road rage can be traffic
congestion, weather condition, noise, time constraint,
underlying emotions (anger, frustration, and irritation),
individual characteristics (age, gender, socioeconomic
status, culture) and personality of the person responsible
for road rage. Social learning theorists suggest that it is
a response learned through observation or imitation of
significant social figures in their life, media, or on road
experiences.
Surveys reveal that most drivers have experienced some
form of road rage, as victim or as perpetrator. In India
. Professor & HOD, Naipunnya Institute of Management and Information Technology, Thrissur.
. Assistant Professor, Naipunnya Institute of Management and Information Technology, Thrissur.
Special issue
November 2015
Page 105
alarmingly there are16 deaths and 58 road injuries per
hour. Delhi ranks highest in terms of fatal accidents and
in number of pedestrians and cyclists falling victim to
road crashes. The statistics available projected that India
had 3, 29,000 cases of signal jumps, 14,000 cases of
drunken driving and 45,158 cases of over speeding. Fatal
accidents have gone up from 18% in 2003 to 28% in
2015 (NDTV 23rd June, 2014).
The behavior of drivers that troubled people most included
persistent sounding of horns (29 per cent), continuous
flashing of headlights (27 per cent), aggressive or
threatening driving behavior (25 per cent) and rude
gestures or verbal insults (23 per cent) (The Hindu, 3rd
August, 2005).
News Reports on Road rage in India
• Kochi: The National Crime Records Bureau estimates
show that normal rush-hour travel in several cities
pales in comparison to this city, which witnessed
about 13,431 road rage incidents over the past year
alone – The Hindu, 20th August, 2015
• Delhi: 2 Shot At In Case of Alleged Road Rage.- NDTV
October 09, 2015
• Son of DTC Driver Killed in Road Rage Incident in
Delhi - NDTV September 02, 2015
• Ahmedabad: A young woman was verbally abused
and her car repeatedly rammed by two men with their
Innova SUV at a busy intersection in Ahmedabad..NDTV March 07, 2015
• Mumbai: The car driver got into a fight with a Volvo
bus driver beat him up with a bat and smashed the
windshield of the Volvo. When the assailant tried to
escape, the bus driver climbed onto to the Maruti
Swift to force it to stop. NDTV August 13, 2015
• Delhi: In road rage case, man beaten to death with
iron rods- NDTV April 06, 2015
Research Frame work :
There have been various reports that road rage has been
prevalent in Cochin City, but there has been no published
study. Thus the aim of the study is to understand whether
road rage and aggressive behavior are prevalent among
drivers and motorists in Cochin City. This study will also
be able to establish the reason for road rage in Cochin
City and a general profile of drivers and motorists who
are perpetrating road rage.
"Road Rage" is a term used to refer to the violent
incidents caused by stress while driving on high traffic
zones on roadways. It is usually associated with
"Aggressive Driving". But, in lay man's language, "Road
Rage" can be defined as an incident in which an angry
or impatient motorist or passenger intentionally injures
Special issue
or kills another motorist, passenger, or pedestrian, or
attempts or threatens to injure or kill another motorist,
passenger, or pedestrian. "Road Rage" often occurs with
exchange of swear words and furious shouts at the fellow
commuter.
Even though there are several definitions of road rage,
there is no widely accepted definition on the concept
and definition of road rage. The definitions of road rage
range from simply “loss of emotional control while driving”
(McDonald, 2002) to a situation where “a driver or
passenger attempts to kill, injure, or intimidate a
pedestrian or another driver or passenger or to damage
their vehicle in a traffic accident” (Asbridge, Smart and
Mann, 2006, p.109). The most widely accepted definition
of road rage has been coined by The U.S. National
Highway Traffic Safety Administration (NHTSA). It
defines road rage as an episode in which "an individual
commits a combination of moving traffic offenses so as
to endanger other persons or property; or an assault
with a motor vehicle or other dangerous weapon by the
operator or passenger(s) of one motor vehicle on the
operator or passenger(s) of another motor vehicle caused
by an incident that occurred on a roadway". The
dictionary.com describes road rage as a “fit of violent
anger by the driver of an automobile especially one
directed towards and endangering other motorists or
pedestrians”. All definitions agree that road rage is a
criminal offense and is an assault caused by the driver
or of one vehicle based on an incident that occurred on
a roadway.
The term “road rage” was first used in the US in the mid1990s (Marshall and Thomas, 2000). Currently the term
“road rage” is used by researchers in traffic psychology,
a branch of psychology that focuses on the behavior of
road users. Many researchers argue that the definition
of road rage should include all forms of aggressive driving
or anti-social behavior on the road. Elliott (1999) lists 15
behaviors associated with road rage, which range from
beeping the horn and gesticulating to threatening or
physically assaulting another driver. According to (Mc
Donald, 2002), aggressive driving and road rage
worldwide cause hundreds of thousands of deaths every
year and damages worth billions of dollars The problem
is set to increase as more people use vehicles to travel
and roads become more congested.
Causes of road rage
Although the elements that cause road rage can vary,
anger is one of the most common causes. Situations
that can cause road rage include:
• Heavy traffic or gridlock
• Feeling stressed
• Construction delays
• Distracted driving
November 2015
Page 106
•
•
•
•
•
•
•
Loud music
Slow driving
Busy work schedule
Crowded roads
Personal problems
Stress
Bad behaviour from other drivers
Road rage and aggressive behaviors
There are different types in which road rage is depicted:
1. Verbal Road Rage : Yelling, Cussing, Gesturing,
Honking, Insulting
2. Quiet Road Rage: Complaining, Rushing, Competing,
Resisting
3. Epic Road Rage: Cutting off, Blocking, Chasing,
Fighting, Shooting
4. Making obscene gestures to other drivers
5. Tailgating: deliberately followed by driving in the front
too closely
6. Changing lanes too quickly and cutting another driver
off
7. Overusing the car horn
8. Headlight flashing
9. Speeding and aggressive acceleration.
10.Forming a "convoy" to block access to a traffic lane.
11. Honking the vehicle's horn or flashing lights excessively.
12.Deliberately hitting another person, vehicle or object
with one's own vehicle.
13.Threatening to use a deadly weapon.
14.Revengeful feeling.
Many countries all over the world including: U.S, Canada,
Australia, England, Ireland, Japan, New Zealand are
taking steps to approach to some solution in this regard.
Road rage increases crime rates in form of arguments
and assaults ending up in injury and even death. Risky
driving is one of the most common causes of road traffic
accidents (James and Nahl, 2000). The prevalence of
road traffic accidents (RTA) has been increasing
drastically every year. According to WHO, RTAs are the
sixth leading cause for hospitalization, disabilities, death,
and economic losses in India (Health Ministry, India,
2000).
Road rage has indeed “reached epidemic proportion in
major cities of the world with almost half of all drivers
experiencing some form of attack or abuse in the course
of driving”. In Britain, an Automobile Association survey
went even further to report that “nine out of ten motorists
claim to have been victims of road rage” (BAA, 1996).
Despite the increased prevalence of road rage, there
have been very few studies being done in India and more
particularly in Cochin City. Most of the studies have so
far limited to developed countries or in metro cities of
India and was used to assess the risk factors or profile
of people responsible for the same. The study on road
rage is necessary especially in developing countries like
India which is having favorable factors for road rage like
overcrowding, non-stringent traffic rules and bad roads.
Cochin has become a hot spot for road rage due to the
fast pace of its development and construction which has
left the roads with a lot of damage and also contributes
to the traffic snarls and jams.
Even though all these are considered to be behaviors
associate by road rage, Psychologists distinguish
between "Road Rage" and "Aggressive Driving".
Accordingly even though the symptoms may be same,
they are not synonymous. "Road Rage" is uncontrolled
anger that results in violence or threatened violence on
the road; it is a Criminal Behavior. "Aggressive Driving"
on the other hand does not rise to the level of criminal
behavior. "Aggressive Driving" includes tailgating, abrupt
lane changes, and speeding, alone or in combination.
These potentially dangerous behaviors are traffic
offenses, but are not criminal behavior. In fact, "Road
Rage" can be distinguished from any other traffic incident
by its "willful and criminal" nature.
Research Method
The present study used an on-line survey questionnaire
to elicit information from the community. The sample for
the study was selected from Face book. This included
people who either lived in Cochin or drive through roads
in Cochin.
"Road Rage" is now considered to be a cultural norm.
People learn this behavior from childhood when being
driven by parents and adults. "Alcohol" has at many
times been found to be associated with many of the
incidents of road rage."Road Rage" is considered as a
menace because it can lead to physical injuries and in
some cases it can lead to death also.
Instruments used in the study
Subjects who agreed to participate and accepted the
terms of informed consent provided responded to the
survey questionnaire that included two sections :
1) demographic questions
2) driving experience questions; which collected
perceptions on related driving behaviors by
Special issue
Recruitment of Participants
Subjects were recruited electronically through emails,
and social networking websites. The criteria included a)
Being at least 18 years of age; b) Having a valid driver’s
license; c) Operating a motor vehicle at least one time
per month and staying in Cochin City. Exclusion criteria
included never having operated a motor vehicle.
November 2015
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themselves and other drivers. The survey included
several sets of questions developed specifically for
the purposes of this inquiry and standard demographic
questions (e.g. age, education, and employment
status). Questions regarding the subjects’ driving
experience (e.g., reasons for driving, types of routes
taken, quantity of weekly driving, and number of years
of driving) were collected to establish relationships if
any from the study.
3) Driving Anger Scale (DAS): The DAS measures driver
anger dimension and is used to measure the anger
intensity, risky behavior while driving, aggressive and
expression of driving anger. Respondents were asked
to rate the level of anger they experience while driving
using a 5–1 Linker scale (5 = “strongly agree” and
1= “strongly disagree”). The original DAS was a 33item scale (alpha reliability = 0.90). The current study
utilized a modified form of DAS taking into
consideration of the problems experienced in roads
of Cochin. It consisted of 32 questions. Scoring
consisted of summing the responses to the scores
on individual subscales and a total summated
response of 32 items, with higher scores representing
greater driver anger. The modified DAS returned with
a good reliability (alpha reliability = 0.88). The scores
can range between 32 to 160. As per the manual, a
score of 80-100 indicates proneness to road rage. A
score of 101 to 120, indicates mild road rage, a score
between 121-140 was considered to be moderate road
rage, and a score above 141 indicated severe road
rage.
Procedure for data collection
The study population was selected from Face book and
online community. A random selection of people who
drive vehicles in Cochin City was selected and was
approached over web for participation in the study. All
subjects who had not responded to the first email were
sent a second and final mail offering to participate in the
study. The web Performa consisted of three pages of
information gathering procedure. Prior to filling the
assessment perform, subjects were to provide written
web based consent for participation in the study. The
first page consisted of semi-structured format for
collecting sociodemographic data. The subsequent
pages consisted of the assessment instruments. The
procedure and instruments were kept as short as
possible for better participation in the study.Subjects
were directed to a specific link, (http://www.e Surveys
Pro.com/Survey.aspx?id=5d8cfba5-591c-442b-ac073008808194e2). Subjects began by reading and agreeing
to the online informed consent. Data was collected until
an adequate number of responses were received. The
ideal sample size was planned to be between 120- 200
subjects, with a minimum of 100 subjects. Once data
Special issue
collection was completed, data was exported into the
proper format for importation into SPSS for statistical
processing.
Analysis
Data was imputed and analyzed using SPSS ver. 17.0.
Internal consistency of DAS was assessed by
Cronbach’s alpha coefficient and the value was 0.88,
which was considered to be satisfactory. Factor analysis
was used in data reduction to identify a small number of
factors that explain most of the variance. The principal
component analysis was used as the means of extraction
and varimax rotation. Other important initial tests are
the Keiser-Meyer-Olkin (KMO) measure, and Bartlett’s
test of sphericity. Pearson’s correlation was used to
evaluate the relationships between DAS and
demographic variables. T-tests were conducted to
determine in-between group differences on basis of
gender, age, education and other demographic factors.
Results
The primary Face book contact was 1368 out of which
three hundred and sixty-seven individuals were found to
be friends whom qualified for being included in the study
to whom the mail invitations were then sent. A total of
208 were also sent the questionnaire through Gmail.
The survey was open for one month and a total of 100
subjects returned the questionnaire. This data of 100
subjects were analyzed with SPSS 17.0. The web
perform was designed in such a way that in order to fill
the survey subject needed to sign the web consent form.
Moreover they also had to answer all the questions upon
which the questionnaire can be returned. Thus, all
subjects who participated in the study completed the
questionnaire. Those who did not complete the study
could not upload the same.
The demographic analysis came out with the
following results :
81% subjects were male and 19% female. As far as age
group is concerned, 24 % belonged to the 18-25 age
group, 22% each belonged to the 26-33 and 34-41 age
group. The 42-50 age groups had 20%and above 51
years had only 12%. 52% of the subjects were married
and 48% unmarried. Majority of the subjects had PG
qualification 60%, followed by 29% with PhD, 10% UG.
44% of the subjects were students, 36% worked in private
sector, the remaining others worked in Public,
government or had their own businesses. 100% of the
subjects had driving license. 77% of the subjects drive
every day followed by 20% who drive once in a week.
47% of the subject’s drive 15 Km or less, 28% drive
between 16-25 Kms and 12% between 26-35 Kms. 58%
of the subjects drive 2-wheelers followed by 42% who
drive 4-wheelers. 82% of the drivers did not receive any
November 2015
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punishment for rash driving whereas 9% subjects have
been fined once for rash driving. 3 each of the subjects
have been fined twice, thrice, and four times for rash
driving. Majority of the drivers drove in urban areas 54%
followed by 35% in suburban and 9% in rural areas. 40%
did not have had any accidents whereas, 28% had one
accident, 18% had two, 8% had three and 6% had 4 or
more. 77% do not drink alcoholic beverages and 23%
drank alcoholic beverages. Out of the 23 respondents
who drink, 66% of the subjects have at least one drink,
22% subjects have 2 drinks and 11% have 3 drinks on a
daily basis.
The DAS levels indicated that 51% of the subjects were
‘prone’ to develop road rage. 29% of the subjects had
‘mild’ road rage, while 8% of the subjects had ‘moderate’
road rage. There were no subjects in the ‘severe’ road
rage category.
Table - 1 : KMO and Bartlett’s test DAS score
KMO and Bartlett's Test
Kaiser-Meyer-Olkin Measure of
Sampling Adequacy.
Bartlett's
Test of
Sphericity
Approx. Chi-Square
Df
Sig.
.737
1667.011
435
.000
Table - 1, is used to test assumptions; essentially, the
Kaiser-Meyer-Olkin (KMO) statistic should be greater
than 0.60 and the Bartlett's test should be significant
(e.g. p < .05). The value obtained in DAS stands at 0.737,
which is good and the Bartlett’s test is significant (.000).
From Factor analysis it was found that the top ten
reasons for people to get angry, revengeful and frustrated
while driving are:
• When other drivers overtake from an unsafe position
(.844)
• Not allowing to overtake (.826)
• Traffic jams (.791)
• Not able to drive fast (.772)
• Grabbing parking space while you wait patiently for
other driver to pullout (.766)
• Other drivers not keeping up the pace (.762)
• Not able to drive fast due to traffic obstructions (.757)
• Aggressive driving by other drivers (.742)
• Stress and frustration in their lives (.730)
• Bad treatment from other drivers (.723)
• Other drivers talking on the cell phone while driving
and paying no attention to traffic lights (.705)
Special issue
The demographic variable age was correlated with DAS;
it was found that anger levels in younger drivers were
higher as compared to the older age group. This finding
is supported by previous studies mentioning that young
male drivers were approximately three times more prone
to causing untoward consequences on the road while
driving (Eksler&Lassarre, 2008). This study view point
also strengthens the view that as drivers become older,
they may become more law abiding and less risk taking
and thus decreasing chances of anger levels and road
rage.
Regardless of age, gender or qualification, high stress
levels play an important part in ventilating anger towards
others. This supports the research by McMurray, who
found that behaviors like reckless driving or displaying
anger towards others is more in people having higher
stress levels and they use the vehicle as an outlet for
ventilating their stress.
All the respondents agree that they have witnessed
aggressive behaviors, except horn-honking (55 percent).
Subjects were asked to endorse what aggressive
behaviors they display while driving. It was found that
yelling at other drivers topped at 22%, followed by verbal
abuse and overtaking at 20% each, slamming brakes at
14%, driving aggressively at 12% and cutting lanes at
17%.
Although the number of female subjects in the sample
was low it was found that there was only a slight
difference between men and women’s scores for driving
anger, with men having higher scores (average DAS
score for men was 96.29) than women (average DAS
score was 92.42), meaning that men in the sample
attributed slightly higher offensive driving behavior than
did women in the sample.
There was no evidence for a significant relationship
between alcohol consumption and driving anger, the data
do not demonstrate a significant relationship between
alcohol consumption and aggressive driving p=.229,
which is not statistically significant (p>.05).
Summary of Key Findings
The present study set out to explore whether road rage
and aggressive behavior existed in the roads in Cochin.
Road rage in the literature has been linked to aggressive
driving, roadway violence and numerous negative
consequences to individuals and society such as stressrelated health problems, property damage, bodily injury
and death (Deffenbacher et al., 2003). Survey data, along
with demographic and driving experiences were collected
in order to examine participants’ awareness of driving
anger. Relationships among these variables were studied
in the hope that the study’s findings might add to the
scholarly understanding of what is popularly called “Road
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Rage” and provide insight leading to social and
psychological approaches to reduce this high-cost
societal phenomenon. There was only small evidence
to prove that there is some significant relationship
between participants’ gender and their tendency towards
driving anger. This finding is almost consistent with the
studies that have examined trait driving anger (J. L.
Deffenbacher, Filetti et al., 2003).
Age was positively correlated with driving anger, with
young drivers being more pessimistic than older drivers.
Previous literature also reports similar findings showing
young male drivers displaying more aggressive behavior
in youth compared to older adults (McMurray, 1970).
The level of education has also been found to have a
negative relationship with aggressive driving. However,
we cannot conclude since the current study had majority
of participants being educated.
Conclusion
As the study concludes, the authorities can take
measures to educate drivers on traffic rules before
providing license; more stringent rules for obtaining license
should be implemented. More over rewards and
punishments for following traffic rules and invocating
penalty and jail terms for breaking rules should be in the
offering. Better technology to detect red light jumpers
and cameras with night vision should be made on
highways and city limits. Sessions on safe driving should
be arranged for drivers with a focus on emotional
management and ample rest. Stress busters by way of
meditation, and listening to songs and so on and so
forth should also be taught to drivers.
Future studies should target a larger population for online
and offline assessment comparing multiple cities and
drivers with a view to understand the intricacies and
elements that trigger road rage. This will enable to curtail
anger in drivers. The researcher’s suggestpolicy makers
to make appropriate reforms in traffic regulations for
better road situations.
Special issue
References
• M. Asbridge, R. G. Smart, and R. E. Mann, “Can we
prevent road rage?” Trauma, Violence, & Abuse, vol.
7, no. 2, pp. 109–121, 2006.
• J. L. Deffenbacher, “Angry college student drivers:
characteristics and a test of state-trait theory,
”Psicologia Conductual, vol. 11, no. 1, pp. 163–176,
2003.
• E. M. Grey, T. J. Triggs, and N. L. Haworth, “Driver
Aggression: the role of personality, social
characteristics, risk and motivation,” Australian
Transport Safety Bureau, CR-81, 1989.
• V. Eksler, S. Lassarre, and I. Thomas, “Regional
analysis of road mortality in Europe,” Public Health,
vol. 122, no. 9, pp. 826–837, 2008.
• L. McMurray, “Emotional stress and driving
performance : the effects of divorce,” Behavioural
Research in Highway Safety, vol. 1, no. 2, pp. 100–
114, 1970.
• World report on road traffic injury prevention
•
www.who.int/...injury prevention/.../road traffic/world
report/.../index.htm l
• USDOT-NHTSA, 1998. U.S. Department of
Transportation (USDOT), National Highway Traffic
Safety Administration (NHTSA). (1998). Motor vehicle
traffic crashes as a leading cause of death in the
U.S., 1994. In Bureau of Transportation Statistics
(BTS): U.S. Department of Transportation (USDOT)
(Eds.), Transportation Statistics Annual Report 1998
(Technical report DOT H5 808 687) [On-line].
Available: http://www.bts.gov.
November 2015
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THE IMPACT OF MARKETING MIX ON CUSTOMER SATISFACTION
TOWARDS LAPTOP INDUSTRY
Dr. M. B. M. Ismail1
Mr. A. L. M. Shameem2
Mr. A. Riswan3
Abstract
In today’s dynamic business environment, marketers must study about marketing mix for the targeted consumer
expectation, perception, preferences, brand awareness and behavior for understanding consumer satisfaction. This
study attempts to identify the impact of marketing mix on customer satisfaction towards laptop industry. 100
undergraduates from South Eastern University of Sri Lanka is taken as sample size for the study. In this research, the
data were collected mainly from primary data. Study concluded that majority of the respondents are females. Results
of the correlation revealed that product, price, place, and promotion have relationship with satisfaction. Hypothesis
result disclosed that there is relationship between marketing mix and customer satisfaction. Results of the regression
exposed that values of R square and adjusted R square are 0.539 and 0.520 respectively. This proves that marketing
mix such as product, price, place and promotion explain 50% of the variation on customer satisfaction.
Key words : customer satisfaction, laptop industry, marketing mix.
Introduction
Today’s business environment is more dynamic and
competitive due to the continuous and rapid changing
environment and dramatic innovation in the information
technology. Each organization is trying to achieve its
organizational goals like more profit, more market share
and survival. In every business, consumers are the center
of the success. In order to be successful, an organization
must fulfill the needs of consumers and preferences.
Marketers must study the targeted consumer expectation,
perception, preferences, brand awareness and behavior.
Understanding consumer satisfaction is an essential
thing in the contemporary business environment. The
buying decision of each consumer differs from person
to person. The marketing mix is an important element
in the field of marketing. The steps taken by a business
enterprise to improve sales is known as marketing effort.
Therefore, marketing effort is not a single function but a
combination of many different activities undertaken by a
firm to market its products. To attain success in the
marketing effort, the various components should be
coordinated. The various components and instruments
used in the marketing process constitute the marketing
mix. The selection of a target market serves as the basis
for creating a marketing mix to satisfy the needs of that
market. Organization should also analyze customer
needs, preference and behaviors with respect to product
design, pricing, distribution and promotion (Clark, 2007).
Statement of the problem
Different marketing experts defined marketing mix in
different ways during different timeframes. Marketing mix
is a set of controllable elements of marketing tools and
marketing strategies of a company in combining these
elements. By the year 2000, an eminent marketing
expert termed as Cutler (2000) indicated that a set of
marketing mix variables can be controlled by the
marketing companies and institutions in their target
market and its composition are required for the reaction.
Recently, another marketing scholar outlined about
elements of the marketing mix that include a set of
marketing tools for achieving the goals of the institute of
marketing (HaKansson and Waluszewski, 2005). Long
ago, marketers use many tools in order to receive
favorable responses from their target markets. These
tools comprise the marketing mix. In fact, marketing
mix is a set of tools that institutions use to achieve their
marketing goals (McCarthy, 1964).
Harrell and Frazier (1999) classified these tools into four
major groups, called the 4P's of marketing that engulfs
product, price, place and promotion. A product as defined
by Armstrong and Kotler (2006), is anything that can be
offered to a market for attention, acquisition, use, or
consumption that might satisfy a want or need.
According to Kotler, Armstrong, Wong, and Saunders
(2008), price is the amount of money charged for a
product or service, or the total values that consumers
exchange for the benefits of having or using the product
or service. This factor is defined by Armstrong and Kotler
(2006) as a set of interdependent organizations that
caters to the process of making a product available to
the consumers. Promotion is defined as sales promotion,
advertising, personal selling, public relations and direct
marketing (Borden, 1984).
1
. Senior Lecturer, Faculty of Management and Commerce, South Eastern University of Sri Lanka, Oluvil,
. Senior Lecturer, Faculty of Management and Commerce, South Eastern University of Sri Lanka, Oluvil.
3
. Undergraduate, Faculty of Management and Commerce, South Eastern University of Sri Lanka, Oluvil.
2
Special issue
November 2015
Page 111
Customer satisfaction is the only profitable tool used by
the companies. Putting the customer first and then
anticipating their needs. In developing customer
satisfaction strategies and programs, financial service
organizations are managing product and service delivery
systems to getting things right at the first time and
maintaining standards. Customer satisfaction plays a
major role in the competitive business environment.
Satisfaction means that a person’s feelings of pleasure
or disappointment resulting from comparing a product
are perceived performance (or outcome) in relation to
his or her expectation (Parasuraman, et, el, 1988).
In this case, laptop companies are aiming for high
customer satisfaction, because customers, who are just
satisfied still, find it easy to switch when a better offer
comes along. In early days, laptop market in Ampara
district was high and only few brands were imported.
But, nowadays, it has changed and grown rapidly. Lot
of new brands with new features at various prices has
introduced. However, most of the customers concentrate
on buying particular brand whereas others buy some
other brands. Nowadays, customers buy laptops for their
professionals’ and study and entertainment purpose and
prestige, fashion and etc. They give a special
consideration to price offer, quality after service,
communicate, advertisement and sales promotional
offers, design, style, color, and model. Companies try
to develop and satisfy these attributes and customer
expectation through marketing mix. So, marketing mix
(4Ps) have significant impact on customer satisfaction
towards lap top companies.
Therefore, this study would like to identify the range of
impact of marketing mix on customer satisfaction.
Currently in the Ampara district, there are several types
of laptops available in different prices, quality, product
features color varieties, sizes, models, designs,
guarantee periods etc. This study analyses the
marketing mix and customer satisfaction towards the
purchasing of laptops and as a result intended to identify
the market leader in the Ampara district.
Research question and objective
This study rises “does marketing mix have significant
influences on customer satisfaction?” as a research
question. This research question is translated into
research objectives as “to identify the impact of marketing
mix on customer satisfaction towards laptop industry”.
Significance of the study
This study is important in several ways. First, this study
assists to gain competitive advantage. Organizations
environment is dynamic. In this dynamic turbulent
environment, the laptop manufacturers or automotive
industry need to use fully integrated sources of competitive
advantage in order to survive (Clark, 2007). Second,
Special issue
Parasuraman, et, el,. (1988) pointed out that customer
buying behavior is not fixed it is changing from time to
time. Nowadays, buyers are really sensitive in terms of
what the company markets. Customers focus on price,
product, place and distribution as marketing mix
elements that play an important role in the marketing
competency. Third, findings of this study help to raise
sales, and profit. Armstrong and Kotler (2006) outlined
that if the sellers do not fully put or give right thing to the
customer it will affect the company sale, market share
and profit. There were very few studies conducted on
which marketing mixes competency influence the laptop
buyer’s buying behavior decision. Fourth, there are
studies in different industries and different countries and
in different time frames with respect to marketing mix
and customer satisfaction (Cutler, 2000). It is significant
to conduct a research to provide understanding and
insight on the factors that influencing laptop purchase.
Fifth, the findings of this study will help the company to
understand more on the marketing competencies and
the customer satisfaction. Finally, this study fills the
research gap in the areas of marketing mix and customer
satisfaction in laptop industries.
Review of Previous literatures
This study reviewed literature into three components
such as marketing mix, customer satisfaction and the
rapport between them. At a first glance, this study
reviews marketing mix. The marketing mix is a term used
to describe the combination of tactics used by a business
to achieve its objectives by marketing its products or
services effectively to a particular target customer group
(CIM, 2004). It is also referred to as the 4 Ps: product,
price, promotion and place. The four Ps of the marketing
are briefly described as follows (Copley, 2004): Product,
the item or service being marketed, through its features,
quality, benefits and quantities; Price, this includes the
price of the item and product assortments and lines,
price changes and payment methods; Place, the location
where the product or service is available to the customer,
including distribution channels; Promotion, market
communication is achieved by personal selling,
advertising, direct marketing, public relations(PR), sales
promotion and sponsorship.
Second part of this literature reviewed about customer
satisfaction. Customer is a real or legal person who
somehow relates to organization and benefits from its
goods and services. Hayes (1998) defined the customer
needs as “features of a product or service, which indicate
its significant dimensions”. In a competitive marketplace
where businesses compete for customers, customer
satisfaction is seen as a key differentiator and increasingly
has become a key element of business strategy.
Customer satisfaction is the best way to keep a customer
loyal and gain others like him. There are two principal
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interpretations of satisfaction within the literature of
satisfaction as a process and satisfaction as an
outcome (Parker and Mathews, 2001). Early concepts
of satisfaction research have typically defined
satisfaction as a post choice evaluative judgment
concerning a specific purchase decision (Oliver, 1980;
Churchill and Suprenant, 1982; Bearden and Teel, 1983;
Oliver and DeSarbo, 1988). The most widely accepted
model, in which satisfaction is a function of
disconfirmation, which in turn is a function of both
expectations and performance (Oliver, Bearden, 1983).
Third part of this study reviewed relationship between
marketing mix and customer satisfaction. Marketing is
a social and managerial process by which individuals
and groups obtain what they need and want through
creating, offering and exchanging products of values with
each other (Kotler and Armstrong, 2005). Based on the
previous principle, a company’s success is caused by
the satisfaction of consumer’s wants. Achieving the
highest possible level of customer satisfaction is always
a great challenge facing any company. When customers
receive a higher level of satisfaction while buying a
product, this means that they will repeat the buying
operation for the same product (Reichheld, 1996), and
will also recommend it to others (Oliver & Swan, 1989a
& b).The relationship between marketing and customer
satisfaction is highly expressed among researchers
(Zineldin & Philipson, 2007). Yelkur (2000) found that
the critical elements in the services marketing mix
influence and positively effects customer satisfaction.
At the same time, there is some evidence to support
the contention that customer satisfaction translates into
higher than normal market share growth. Grant (1998)
reports that the American Customer Satisfaction Index
studies find a positive correlation between customer
satisfaction and stock market returns.
Conceptualization and Operationlisation
Conceptual model is depicted in Figure 1. Product is
composed of product features, brand name, packaging,
warranty and after sales services. Price incorporates
list price, discount, allowances, payment of period and
credit terms. Place embraces locations, transport,
coverage, channel and inventory. Promotion engulfs
advertisement, sales promotions, personal selling, direct
marketing and public relation.
Figure - 1 : Conceptual model
Marketing
Mix
• Product
• Price
• Place
• Promotion
Customer
Satisfaction
(Source: Adopted from Kotler and Armstrong and developed
by researchers)
Special issue
Hypothesis development
This study set the following hypothesis.
• Null hypothesis : marketing mix is not related to
customer satisfaction
• Alternative hypothesis : marketing mix is related to
customer satisfaction
Sampling design
The population of this study is based on the laptop users
(customers) among the undergraduate students. Thus,
this study selected all undergraduates of South Eastern
University of Sri Lanka as the population for this study.
Population and sample size are indicated in Table 1. To
each 100 undergraduates, 3 undergraduates were
selected.
Table - 1 : Population and Sample Size
Faculty
Faculty of
Management and
Commerce
Faculty of Arts
and Culture
Faculty of Islamic
Studies and
Arabic Language
Faculty of
Engineering
Faculty of Applied
Science
Total
Population
1023
806
743
286
Sample size (Number
of Undergraduates)
31
24
22
9
449
14
3307
100
Data collection method
In this research, the data were collected mainly from
primary data from undergraduates of South Eastern
University of Sri Lanka through given questionnaires for
the laptop users (customers).
Results and Findings
Demographic profile of respondents
58% of the respondents are females. There are 42% of
males respondents. There are 31%, 24%, 22%, 14%
and 9% of respondents from FMC, FAC, FIA, FAS and
FEN respectively. 2nd, 1st, 3rd and 4th year
undergraduates are 36%, 31%, 17% and 16%
respectively. Brands such as HP, Dell, other varieties,
Toshiba and Samsung laptops are used by 37%, 34%,
13%, 10% and 6% respectively. 29%, 21%, 17%, 15%,
14% and 4% of undergraduates use laptops for 2, 3, 1,
less than 1 year, 4 years and less than 5 years. 72%,
and 10% of undergraduates use laptops for study
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purpose, and internet purpose. 8% of the undergraduates use internet for accessing games & leisure, e-mail
communication, other, business activities. The remaining 10% of undergraduates use laptops for all of the above
needs.
Correlation
Product, price, place, and promotion have relationship with satisfaction. Pearson values are 0.490, 0.466, 0.643
and 0.588 respectively. Marketing mix such as product, and price have moderate relationship with customer
satisfaction. Place and promotion have higher relationship with customer satisfaction. Correlation values are shown
in table 2. Null hypothesis set in this study is rejected and alternative is accepted. Accepting alternative hypothesis
refers to that there is relationship between marketing mix and customer satisfaction. This is proved by significant
values.
Table - 2 : Correlation between marketing mix and customer satisfaction
Product
Product
Pearson Correlation
Place
.490**
.000
.000
.000
.000
100
100
100
100
100
.480**
1
.491**
.422**
.466**
.000
.000
.000
1
.000
N
100
100
100
100
100
.406**
.491**
1
.491**
.643**
Sig. (2-tailed)
.000
.000
.000
.000
N
100
100
100
100
100
.462**
.422**
.491**
1
.588**
Sig. (2-tailed)
.000
.000
.000
N
100
100
100
100
100
.490**
.466**
.643**
.588**
1
Sig. (2-tailed)
.000
.000
.000
.000
N
100
100
100
100
Pearson Correlation
Satisfaction
Satisfaction
.462**
Sig. (2-tailed)
Pearson Correlation
Promotion
Promotion
.406**
Sig. (2-tailed)
Price
Place
.480 **
Pearson Correlation
N
Price
Pearson Correlation
.000
100
Regression
Following the correlation analysis, regression analysis is conducted.
Table - 3 : Model Summary
Model
1
R
.734
R
Square
a
.539
Adjusted
R Square
.520
Std. Error
of the
Estimate
Change Statistics
R Square
Change
1.86621
.539
F
Change
27.769
df1
df2
4
95
Sig. F
Change
.000
a. Predictors: (Constant), Promotion, Price, Product,
Place
Model summary shows that values of R square and adjusted R square are 0.539 and 0.520 respectively. This
shows that marketing mix such as product, price, place and promotion explain 50% of the variation on customer
satisfaction. In terms of analysis of variance table shown in table 4, model is significant. Analysis of variance is
shown in Table 4.
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November 2015
Page 114
Table - 4 : ANOVA
Model
1
Sum of Squares
df
Mean Square
Reg ression
386.850
4
96.712
Residual
330.860
95
3.483
Total
717.710
99
F
27.769
Sig.
.000
a
a. Predictors: (Constant), PROMO, PRIC, PRODUCT, PLAC
b. Dependent Variable: SATISFACTION
In terms of coefficient table, place, promotion, product and price influences on customer satisfaction in different
degrees. Coefficient table is shown in Table 5.
Table - 5 : Coefficients
Model
B
1
(Constant)
Std. Error
-.744
1.083
Product
.141
.075
Price
.071
Place
Promotion
Standardized
Coefficients
t
Sig.
Beta
-.687
.494
.160
1.891
.062
.087
.071
.817
.416
.346
.074
.403
4.669
.000
.302
.090
.287
3.351
.001
a. Dependent Variable: SATISFACTION
Conclusion
Majority of the respondents are females. The highest
percentage (31%) of the respondents are from FMC. 2nd
year undergraduates are high. HP brand is used by the
highest number of undergraduates. 29% of
undergraduates use laptops for 2 years. 72% of
undergraduates use laptops for study purpose. Results
of the correlation revealed that product, price, place, and
promotion have relationship with satisfaction. Values
are 0.490, 0.466, 0.643 and 0.588 respectively. Marketing
mix such as product (0.490), and price (0.466) have
moderate relationship with customer satisfaction. Place
(0643) and promotion (0.588) have higher relationship
with customer satisfaction. Hypothesis result disclosed
that there is relationship between marketing mix and
customer satisfaction. Results of the regression exposed
that values of R square and adjusted R square are 0.539
and 0.520 respectively. This proves that marketing mix
such as product, price, place and promotion explain 50%
of the variation on customer satisfaction. These results
are similar with those of Bearden and Etzel (2012);
Hallowell (1996), Anderson et. al., (1994); Alom and
Haque (2011); Arham (2010) who found the relationship
between product; pricing; place (distribution); promotion
and customer satisfaction.
Special issue
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November 2015
Page 116
GROUP DIFFERENCES IN THE SELECTION OF FAST FOOD
RESTAURANT: A USE OF DISCRIMINANT ANALYSIS
Abstract
There is a big argument of which marketing mix strategies are essential. Realizing this fact, this study also considers
the selection of group in three types such as frequently selected group, selected group and infrequently selected
group. This study attempts to know the significance difference exists between “frequently selected group”, “selected
group” and “infrequently selected group” in terms of marketing mix of 8Ps and to develop optimal discriminate
functions for “frequently selected group”, “selected group” and “infrequently selected group” in terms of marketing mix
of 8Ps. This study collected data from 66 cloth marketers in ADSL. Data were collected during the second quarter of
the 2015. Response rate was 79% of the issued questionnaire. This study adopted a non-probability sampling
technique of convenience sampling. This study used a discriminate analysis as a new technique for selecting fast
food restaurants. Descriptive statistics such as mean, standard deviation and coefficient of variation were used in this
study. Wilky’s Lambda and discriminate functional analysis were also carried out in this study. Study found that
frequently selected group, selected group and infrequently selected groups differ in terms of tangibles, number of
radio advertisements made and number of separate packaging for different varieties in the first function and number
of seals over the lunch packet and number of public events sponsored of the second function. Based on the results
of the study, it is possible to develop two standardized canonical discriminate functions.
Key words: Discriminate Analysis, Fast Food Restaurant, Group Differences, Selection.
Introduction
There is an increasing trend that people are having their
food outside the home due to various reasons such as
working outside home, busy at home, quickness and
so on. This trend has been observed not only in
developing countries but also in developed countries. A
comparative study has been conducted in USA and
Canada. Kara, Kaynak, and Kucukemiroglu (1997)
studied about marketing strategies for fast-food
restaurants from a customer point of view.
In recent years, a major food consumption trend in the
USA and Canada is that more people are eating more
meals outside their homes. It is predicted that this trend
will accelerate in the future. As a result, fast-food markets
will offer greater growth opportunities for marketers.
Findings of the study offer need-oriented marketing
strategies for both franchisers and franchisees in the
US and Canadian fast-food sectors to enable them to
be more competitive in this fast-changing business
environment. Goyal, and Singh (2007) studied about
consumer perception about fast food in India using an
exploratory study. This study seeks to estimate
importance of various factors affecting the choice of fast
food outlets by Indian young consumers. Results
indicate that the young Indian consumer has passion
for visiting fast food outlets for fun and change but home
food is their first choice. They feel homemade food is
much better than food served at fast food outlets. They
have the highest value for taste and quality (nutritional
values) followed by ambience and hygiene. Three
dimensions (service and delivery dimension, product
dimension, and quality dimension) of fast food outlets'
attributes are identified based on factor analysis results.
Research studied have been conducted in developed
(USA and Canada) & developing countries (India) in fast
food industry during the last two decades. These studies
differ in terms of country, time period and methodology.
But, there are very few research studies in Sri Lanka. To
fill this research gap, this study is conducted in Ampara
District of Sri Lanka (ADSL) in 2015 using a discriminate
analysis.
Linda, Charles, and Robert (1997) studied about an
evaluation of fast food restaurant satisfaction,
determinants, competitive comparisons and impact on
future patronage. Thus, this study identified product and
price as the determinants of evaluating a fast food
restaurant. Selection of a fast food restaurant is not alone
dependent on product and price. There may be some
other factors of marketing mix to a wider area. Qin,
Victor, and Zhao (2010) studied about perceived service
quality in fast-food restaurants that is empirical evidence
from China. This study also found product and price as
the determinants of service quality of fast food restaurant.
Findings of this study also resemble those of the previous
study. Albeit, this study deviates from the previous study
on the basis that is relied on SERVPERF instrument.
Kara, Kaynak, and Kucukemiroglu (2014) studied about
1
. Senior Lecturert, Faculty of Management and Commerce, South Eastern University of Sri Lanka, Oluvil
Special issue
November 2015
Page 117
consumer preferences of fast-food outlets in the U.S.
and Canada which is a comparative study. This study
emphasizes that marketing strategies are essential for
fast food restaurant. But, there is a big question of which
marketing mix strategies are essential. Is it in the form
of the 4Ps, or 7Ps or 8Ps. Realizing this fact, proposed
study considers marketing mix strategies of 8Ps. This
study also considers the selection of group in three types
such as frequently selected group, selected group and
infrequently selected group.
Research questions and objectives
This study rises whether significance difference exists
between “frequently selected group”, “selected group”
and “infrequently selected group” in terms of marketing
mix of 8Ps and is it possible to develop optimal
discriminate functions for “frequently selected group”,
“selected group” and “infrequently selected group” in
terms of marketing mix of 8Ps. Thus, this study attempts
to know the significance difference exists between
“frequently selected group”, “selected group” and
“infrequently selected group” in terms of marketing mix
of 8Ps and to develop optimal discriminate functions for
“frequently selected group”, “selected group” and
“infrequently selected group” in terms of marketing mix
of 8Ps.
Rationale of this study
This study signifies in several ways. This study became
popular since long ago in different countries. There are
number of studies in foreign countries in fast food
restaurant. Kara, Kaynak, and Kucukemiroglu (1996)
studied about positioning of fast-food outlets in two
regions of North America. Agnes, Law, Hui, and Zhao
(2004) modeled the repurchase frequency and customer
satisfaction for fast food outlets. Gilbert, Veloutsou,
Mark, and Moutinho (2004) studied about measuring
customer satisfaction in the fast food industry in a crossnational approach of four English-speaking countries.
Second, previous studies adopted different methodologies.
They adopted regression and factor analysis methods
for their analysis. But, this study is a discriminant
analysis. Third, previous studies were conducted using
SERVQUAL and SERVPERF instruments. But, this
study is a quantified way of marketing mix. This study
deviates from previous studies on the basis that the group
is cascaded into three groups such as “frequently
selected group”, “selected group” and “infrequently
selected group”.
Outline of Review of Literature
Tsai, Shih, and Jason (2007) studied about a comparison
of the service quality of fast food chain franchises.
Stevens, Knutson and Patton (1995) have presented a
DINESERV measurement scale for the restaurant
Special issue
business. Alex, and Edwin (2000) studied about how
restaurant features affect check averages in the Toronto
Restaurant Market. Liu, and Chen (2000) studied about
fast food competition in the Philippines. Tripp, Karen,
Carol, and Mary (1995) studied about factors influencing
restaurant selection by travelers who stop at visitor
information centers. Auty (1992) studied about consumer
choice and segmentation in the restaurant industry.
Research Design and Methodology
This study is composed of a blended research design
that covers both exploratory and conclusive research
designs. Exploratory research is designed for stating
research problem. Following exploratory research
design, conclusive research is carried out. Descriptive
research is done as a part of conclusive research design.
Single-cross sectional study is undertaken due to the
fact that data are collected only once.
Population and sample
Population refers to all the customers who visit Fast
Food Restaurants in Ampara District of Sri Lanka (ADSL).
This study collected data from 66 cloth marketers in
ADSL. They were asked about the factors for selecting
fast food restaurants. A simple questionnaire was
designed to issue and collect the data using Final Year
Undergraduates from Faculty of Management and
Commerce, South Eastern University of Sri Lanka. Data
were collected during the second quarter of the 2015.
Response rate was 79% of the issued questionnaire.
Sampling technique
This study adopted a non-probability sampling technique
of convenience sampling. Researcher tried to collect the
population size of the customers. But, it was impossible
due to time constraint and accuracy of data.
Analytical technique
Previous studies followed different analytical techniques.
But, this study used a discriminate analysis as a new
technique for selecting fast food restaurants. Descriptive
statistics such as mean, standard deviation and
coefficient of variation were used in this study. Wilky’s
Lambda and discriminate functional analysis were also
carried out in this study. SPSS with the version of 22.0
was used in this study.
Results and Discussion of Findings
Descriptive statistics
This is a three- group discriminate analysis. From the
group statistics, it is understood that three groups such
as frequently selected group, selecting group and
infrequently selecting group are separated in terms of
tangibles, number of radio advertisements made &
number of separate packaging for different varieties and
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Page 118
number of seals over the lunch packet & number of public events sponsored. These variables have the lowest
standard deviation of all. Mean and standard deviation of group statistics are revealed in Table 1.
Table - 1: Mean and Standard deviation of Group Statistics
Group 1
Selection of fast
food restaurant
number of seals
over the lunch
packet
Mean
Std.
Deviation
Group 2
N
Std.
Deviation
Mean
Group 3
N
Total
Std.
Deviation
Mean
N
Mean
Std.
Deviation
N
1.0000
.00000
1
5
1.4324
.50225
37
2.0000
.00000
1
4
1.4545
.50175
66
3.7333
.88372
1
5
3.8108
.93802
37
2.7857
.89258
1
4
3.5758
.99322
66
2.2600E2
53.29165
1
5
2.4297E2
71.87431
37
2.1500E2 41.83300
1
4
2.3318E2
62.93242
66
18.3333
4.08248
1
5
19.5946
4.31058
37
17.8571
2.56776
1
4
18.9394
3.97252
66
1.7333
.79881
1
5
2.0270
.79884
37
1.5714
.51355
1
4
1.8636
.76231
66
1.6933E2
47.72940
1
5
1.5351E2
43.60277
37
1.8143E2 56.13954
1
4
1.6303E2
48.03748
66
3.4667
.99043
1
5
3.2432
1.01120
37
1.9286
.82874
1
4
3.0152
1.11621
66
1.6000
.73679
1
5
2.2703
.73214
37
2.0000
.00000
1
4
2.0606
.69898
66
frequency of
smile at buyer
2.0667E2
65.10065
1
5
2.1757E2
79.24664
37
2.1429E2 66.29935
1
4
2.1439E2
72.72982
66
frequency of
nicely dressed
1.7000E2
45.51295
1
5
1.7162E2
57.17971
37
1.9286E2 67.53103
1
4
1.7576E2
57.00366
66
waiting time in
queue
6.3333
4.41858
1
5
5.5135
2.11636
37
7.6429
4.89281
1
4
6.1515
3.49172
66
8.8000
1.85934
1
5
8.8108
2.66498
37
13.2143
2.19014
1
4
9.7424
2.98875
66
6.2667
.45774
1
5
6.4324
.50225
37
6.1429
.36314
1
4
6.3333
.47502
66
number of
separate
packaging for
different varieties
price per parcel
discount per
parcel
number of free
rewards
number of leaflet
issued
number of radio
advertisements
made
number of public
events
sponsored
tangibles
opening days
Structure matrix shows the correlation between individual predictors with the function. Structure matrix has two
optimal functions. The first function orders tangibles, number of radio advertisements made, and number of separate
packaging for different varieties respectively in the first three places. The second function orders number of public
events sponsored, and number of seals over the lunch packet respectively in the first two places. Structure matrix
is shown in Table 2.
Table- 2 : Structure Matrix
Function
1
Tangibles
Number of radio advertisements made
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2
.336
*
-.118
-.266
*
-.026
Page 119
-.199
*
.116
Frequency of nicely dressed
.070
*
-.010
Number of public events sponsored
.001
.540
*
Number of seals over the lunch packet
.361
.472
*
Number of free rewards
-.082
.236
*
Opening days
-.087
.218
*
.083
-.206
*
Discount per parcel
-.057
.188
*
Price per parcel
-.062
.164
*
Waiting time in queue
.096
-.160
*
Frequency of smile at buyer
.003
.077
*
Number of separate packaging for different varieties
Number of leaflet issued
Pooled within-groups correlations between discriminating variables and standardized canonical discriminate
functions
Variables ordered by absolute size of correlation within function.
*. Largest absolute correlation between each variable and any discriminate function
Group centroids are the mean values for the discriminate scores for a particular group. In this study, there are three
groups such as frequently selected group, selecting group and infrequently selecting group. There are three group
centroids. Group centric for the first and second group in the first function is negative. This is because standard
deviation for tangibles, number of radio advertisements made, and number of separate packaging for different
varieties in the first function of the first group (frequently selected group) vary than those of second group (selecting
group). Group centric for the third group in the first function is positive. This is because standard deviation for
tangibles, number of radio advertisements made, and number of separate packaging for different varieties in the first
function of the second group (selected group) declines from the second group to the third group (infrequently
selecting group). Group centric for the first and third group in the second function is negative. This is because
standard deviation for number of seals over the lunch packet and number of public events sponsored in the second
function of the first and third group (frequently selected group and infrequently selected group) vary than those of
second group (selecting group). Group centric for the second group in the second function is positive. This is
because standard deviation for number of seals over the lunch packet and number of public events sponsored in the
second function declines from the first to second group (frequently selected group to selected group). Group
centroids are shown in Table 3.
Table - 3 : Functions at Group Centroids
Selection of fast food
restaurant
Function
1
2
1
-1.617
-1.301
2
-.941
.596
3
4.218
-.183
Unstandardized canonical discriminate functions evaluated at group means
Pooled within - group correlation matrices shows the correlation between predictors such as tangibles, number of
radio advertisements made & number of separate packaging for different varieties in the first function and number of
seals over the lunch packet & number of public events sponsored of the second function. Correlation between
predictors is enough. Thus, there is no multi-collinearity problem. Table 4 shows the correlation between predictors.
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November 2015
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Table - 4 : Pooled Within-Groups Matrices
Number of
seals over
the lunch
packet
Number of
separate
packaging for
different
varieties
Number of
radio
advertisements
made
Number of
public events
sponsored
tangibles
Number of seals over the
lunch packet
1.000
-.227
.306
.427
-.364
Number of separate
packaging for different
varieties
-.227
1.000
.167
-.284
-.054
Number of radio
advertisements made
.306
.167
1.000
-.041
-.269
Number of public events
sponsored
.427
-.284
-.041
1.000
.279
-.364
-.054
-.269
.279
1.000
tangibles
Tests of Equality of Group Means incorporate Wilky’s λ and F statistics. Wilky’s λ for each predictor is the ratio of
the within- group sums of squares (SS residual/ SS error) to the total sums of squares (SSTotal). Thus, its value
can vary between 0 to 1. The closer to the zero there may be different between three groups. In this study, values
of Wilky’s λ for three predictors in the first function vary between 0.631 to 0.826. Specially speaking, tangibles,
number of radio advertisements made and number of separate packaging for different varieties in the first function
play an important role in determining the selection of fast food restaurant than other variables. Values of Wilky’s λ
for three predictors in the second function vary between 0.555 to 0.847. Thus, number of seals over the lunch packet
and number of public events sponsored of the second function also play an important role for determining the
selection of fast food restaurant.
Univariate F statistics for tangibles, number of radio advertisements made & number of separate packaging for
different varieties in the first function and number of seals over the lunch packet & number of public events sponsored
of the second function are 18.412, 11.394 & 6.634 and 25.261 & 5.692 with degrees of freedom 2 and 63 respectively.
Df1 is the degree of freedom for numerator. This is C – 1 that equals 2 (3 - 1) for all predictors. Df2 is the degrees of
freedom for denominator. This is n – k -1 that equals 63 for all predictors. p (sig.) values for tangibles, number of
radio advertisements made and number of separate packaging for different varieties in the first function and number
of seals over the lunch packet and number of public events sponsored of the second function are less than 0.05.
Thus, these predictors significantly differentiate between three groups such as frequently selected group, selected
group and infrequently selected groups. Tests of Equality of Group Means are shown in Table 5.
Table - 5 : Tests of Equality of Group Means
Wilks' Lambda
F
df1
df2
Sig.
.555
25.261
2
63
.000
Number of separate packaging for different
varieties
.826
6.634
2
63
.002
Price per parcel
.965
1.134
2
63
.328
Discount per parcel
.963
1.205
2
63
.307
.935
2.173
2
63
.122
.942
1.936
2
63
.153
.734
11.394
2
63
.000
.847
5.692
2
63
.005
.996
.117
2
63
.890
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.975
.799
2
63
.454
.941
1.972
2
63
.148
Tangibles
.631
18.412
2
63
.000
Opening days
.936
2.152
2
63
.125
Canonical Discriminate Functions shows the eigenvalues. Since there are three groups (frequently selected group,
selected group and infrequently selected group) two discriminate functions are estimated. The eigenvalue of these
two discriminate functions are 5.097 and 0.619 respectively and they both explain 100 percent of the explained
variance. The higher eigenvalue is the more better. Canonical correlations associated with these discriminate
functions are 0.914 and 0.618. The square of these correlations are equal 0.835396 and 0.381924 which indicates
around 84% and 38% of the variance in the dependent variable (selection of fast food restaurant) is explained by
these models that consist of tangibles, number of radio advertisements made and number of separate packaging for
different varieties in the first function and number of seals over the lunch packet and number of public events
sponsored of the second function. Of these two functions, the first function plays an important role the second
function. Thus, there is a research gap for finding the remaining 16 % and the 38% of the variance in the selection
of fast food restaurant that is accounted by one or more unknown predictors. Canonical Discriminate Functions are
depicted in Table 6.
Table - 6 : Eigenvalues of Canonical Discriminate Functions
Function
1
Eigenvalue
.619
Cumulative %
Canonical Correlation
89.2
89.2
.914
a
10.8
100.0
.618
5.097
2
% of Variance
a
a. First 2 canonical discriminant functions were used in the analysis.
Hypothesis testing and Wilks' Lambda
Researcher set the hypothesis of testing whether group means are equal. Hypotheses are stated as denoted
below.
Null hypothesis: Means of all discriminate functions in all groups are not different i.e. group means are equal.
Alternative hypothesis: Means of all discriminate functions in all groups are different i.e. groups means are not
equal.
Wilks' Lambda is used to test the null hypothesis that means of all discriminate functions in all groups are different.
Value of Wilks' Lambda is 0.101 and 0.618 for function 1 and 2 which are estimated on the basis of the Chi- square
transformation and degrees of freedom. In this study, Wilks' Lambda is significant with the Sig. values of 0.000 and
0.007 respectively. p value (Sig. value) is less than significance level (5%). Thus, researcher rejects null and do not
reject alternative hypothesis. Accepting alternative hypotheses refers to means of all discriminate functions in all
groups are different. Frequently selected group, selected group and infrequently selected groups differ in terms of
tangibles, number of radio advertisements made and number of separate packaging for different varieties in the first
function and number of seals over the lunch packet and number of public events sponsored of the second function.
Values of Wilks' Lambda, Chi- square, degrees of freedom and Sig. values are tabulated in Table 7.
Table - 7: Wilks' Lambda
Test of Function (s)
Wilks' Lambda
Chi-square
df
Sig.
1 through 2
.101
130.512
26
.000
2
.618
27.468
12
.007
Discriminate model
Based on the results of the study, standardized canonical discriminate function can be formulated using standardized
canonical discriminate function coefficient that is shown in Table 8.
Special issue
November 2015
Page 122
Table - 8 : Standardized Canonical Discriminant Function Coefficients
Function
1
2
1.300
.600
Number of separate packaging for different varieties
-.054
.479
Price per parcel
-.223
.172
Discount per parcel
.060
-1.965
.003
2.186
.074
-.152
-.638
-.127
-.675
.902
-.301
-.481
-.022
.067
.156
.480
Tangibles
.876
-.284
-.314
.212
Opening days
This study formulated two standardized canonical
discriminate functions that are denoted in Formula (01
and 02).
D = 0.876 Tangible + (- 0.638) Number of radio
advertisements made + (-0.054) Number of separate
packaging for different varieties…………………
……………….………..Formulae (01)
D = 0.600 Number of seals over the lunch packet + 0.902
Number of public events sponsored …………..............
..........................................................................................Formulae
(02)
Conclusions
Results of the descriptive statistics revealed that three
groups such as frequently selected group, selecting
group and infrequently selecting group are separated in
terms of tangibles, number of radio advertisements made
& number of separate packaging for different varieties
and number of seals over the lunch packet & number of
public events sponsored. These variables have the lowest
standard deviation of all. In terms of the structure matrix,
the first function orders tangibles, number of radio
advertisements made, and number of separate packaging
for different varieties respectively in the first three places.
The second function orders number of public events
sponsored, and number of seals over the lunch packet
respectively in the first two places. Tests of Equality of
Group Means incorporate Wilky’s ? and F statistics
found that values of Wilky’s ? for three predictors in the
Special issue
first function vary between 0.631 to 0.826. Specially
speaking, tangibles, number of radio advertisements
made and number of separate packaging for different
varieties in the first function play an important role in
determining the selection of fast food restaurant than
other variables. Values of Wilky’s ? for three predictors
in the second function vary between 0.555 to 0.847.
Thus, number of seals over the lunch packet and number
of public events sponsored of the second function also
play an important role for determining the selection of
fast food restaurant. Univariate F statistics witnessed
that p (sig.) values for tangibles, number of radio
advertisements made and number of separate packaging
for different varieties in the first function and number of
seals over the lunch packet and number of public events
sponsored of the second function are less than 0.05.
Thus, these predictors significantly differentiate between
three groups such as frequently selected group,
selected group and infrequently selected groups.
Canonical Discriminate Functions revealed that around
84% and 38% of the variance in the dependent variable
(selection of fast food restaurant) is explained by these
models that consist of tangibles, number of radio
advertisements made and number of separate packaging
for different varieties in the first function and number of
seals over the lunch packet and number of public events
sponsored of the second function. Of these two
functions, the first function plays an important role the
second function. Thus, there is a research gap for finding
the remaining 16 % and the 38% of the variance in the
November 2015
Page 123
selection of fast food restaurant that is accounted by
one or more unknown predictors. In this study, Wilks'
Lambda is significant with the Sig. values of 0.000 and
0.007 respectively. p value (Sig. value) is less than
significance level (5%). Thus, researcher rejects null and
do not reject alternative hypothesis. Accepting alternative
hypotheses refers to means of all discriminate functions
in all groups are different. Frequently selected group,
selected group and infrequently selected groups differ
in terms of tangibles, number of radio advertisements
made and number of separate packaging for different
varieties in the first function and number of seals over
the lunch packet and number of public events sponsored
of the second function. Based on the results of the study,
two standardized canonical discriminate functions have
been formulated using standardized canonical
discriminate function coefficients that are: D = 0.876
Tangible + (- 0.638) Number of radio advertisements made
+ (-0.054) Number of separate packaging for different
varieties and D = 0.600 Number of seals over the lunch
packet + 0.902 Number of public events sponsored.
Limitations of this study and future research venues
This study is geographically limited to geographical
coverage of ADSL. This study may be extended to islandwide. Researcher used a non- probability sampling
technique of convenience. Study may be conducted using
probability sampling technique. Sample size may be
limited to 66. When selecting a probability sampling
technique, sample size may be taken in a higher number.
•
Linda, S. P., Charles, E. P. and Robert, H. L. (1997),
“An Evaluation of Fast Food Restaurant Satisfaction,
Determinants, Competitive Comparisons and Impact
on Future Patronage”, Journal of Restaurant &
Foodservice Marketing, Vol. 2, Iss. 3, pp. 3-20.
•
Qin, H., Victor, R. P. and Zhao, Q. (2010) "Perceived
service quality in fast-food restaurants: empirical
evidence from China", International Journal of Quality
& Reliability Management, Vol. 27 Iss: 4, pp.424–
437.
•
Agnes K.Y. Law, Y.V. Hui, and Zhao, X. (2004)
"Modelling repurchase frequency and customer
satisfaction for fast food outlets", International Journal
of Quality & Reliability Management, Vol. 21 Iss: 5,
pp. 545–563.
•
Gilbert, G. R., Veloutsou, C., Mark, M. H. G., and
Moutinho, L. (2004) "Measuring customer satisfaction
in the fast food industry: a cross-national approach",
Journal of Services Marketing, Vol. 18 Iss: 5, pp. 371–
383.
•
Tsai, M. C., Shih, K. H., and Jason, C. H. C. (2007),
“A comparison of the service quality of fast food chain
franchises’, International Journal of Services and
Standards, Vol. 3, Iss. 2, pp. 1-10.
•
Stevens, A., Knutson, B., and Patton, C. (1995), “A
comparison of the service quality of fast food chain
franchises’, International Journal of Services and
Standards, Vol. 3, Iss. 2, pp. 1- 10.
•
Alex, M. S., and Edwin, K. C. (2000), “How restaurant
features affect check averages: A study of the Toronto
Restaurant Market”, The Cornell Hotel and Restaurant
Administration Quarterly Vol. 41, Iss. 6, pp. 56–63.
•
Liu, C. M., and Chen, K. J. (2000) "A look at fast
food competition in the Philippines", British Food
Journal, Vol. 102 Iss: 2, pp.122-133.
References
•
•
Kara, A., Kaynak, E., and Kucukemiroglu, O. (1997)
"Marketing strategies for fast-food restaurants: a
customer view", British Food Journal, Vol. 99 Iss: 9,
pp. 318-324.
Goyal, A., and Singh, N. P. (2007) "Consumer
perception about fast food in India: an exploratory
study", British Food Journal, Vol. 109 Iss: 2, pp.182195.
Special issue
November 2015
Page 124
A STUDY OF WORKING ENVIRONMENT FOR SCHOOL TEACHERS
Abstract
Working environment refers to the conditions in which they must teach and their students are obliged to learn. There
are facilities for school teachers in Schools in Ampara District, Eastern Province of Sri Lanka. A good working
environment is a must for school teachers in this regard. This study attempts to categories the factors for working
condition. This study collected data from 69 teachers using convenient sampling method. Data are collected from
questionnaire using Undergraduates of Faculty of Commerce and Management, South Eastern University of Sri
Lanka during the period of 2015. Results revealed that value of Kaiser-Meyer-Olkin Measure of Sampling Adequacy
is 0.530. Extracted communalities for sickness, absenteeism, trouble with teachers, problem with principal, issue with
family, number of subjects taught, free subject coverage, teaching aids, learning material, starting time, interval time,
finishing time and adequate staff are greater than 0.6. The first six factor components represent around 77% of the
total variance. It was fund that ,based on the results of the factor score, factors are categorized into general working
environmental factors, physical working environmental factors and social working environmental factors. Considering
the above categorization, a model for working environment for school teachers has been developed in this study.
Key words: School teachers, working environment.
Introduction
Working environment refers to the conditions to which
teachers comply with. In other words, working
environment refers to the conditions in which they must
teach and their students are obliged to learn. Research
attentions have been paid to working conditions and
school teachers. School teachers might contribute to
students’ learning at schools. Several convincing studies
identified that the teacher as the most important schoollevel factor in students’ achievement. The contribution
of teachers was shown to be especially important for
low-income students, who tend to have fewer learning
supports outside of school.
Also, researchers found that the effectiveness of teachers
varies widely, even within the same school (McCaffrey,
Koretz, Lockwood, & Hamilton, 2004; Rivkin, Hanushek,
& Kain, 2005; Rockoff, 2004). In response to these
widely discussed findings, many state and district
officials of different countries sought to recruit only the
most promising teachers and to retain only the most
effective ones. Thus, working conditions for teachers have
to be maintained continuously in all countries. School
education is in good condition in Sri Lanka. There are
adequate facilities for school teachers in Schools in
Ampara District, Eastern Province of Sri Lanka. School
education is the base for University level education. A
good working environment is a must for school teachers
in this regard. Realizing this fact, this study is
undertaken in Ampara District, Eastern Province of Sri
Lanka.
Problem is defined using previous research findings. A
number of research findings gave different factors for
working environment for teachers. Recent case studies
and media reports portray high-poverty, high-minority
schools that are not hard to staff, but actually attract
and retain good teachers, suggesting that those schools
provide the conditions and supports that teachers need
to succeed with their students—whoever those students
may be (Chenoweth, 2007, 2009; Dillon, 2010; Ferguson,
Hackman, Hanna, & Ballantine, 2010; Johnson &
Birkeland, 2003). In addition to this, recent large-scale
quantitative studies provide further evidence that teachers
choose to leave schools with poor work environments
and that these conditions are most common in schools
that minority and low-income students typically attend
(Borman & Dowling, 2008; Boyd et, al., 2011; Ladd, 2009,
2011; Loeb, Darling-Hammond, & Luczak, 2005).
Although the mounting evidence suggests that the
working condition play vital role for teachers studies
found different findings i.e. different factors for working
environment and factors found differ country to country.
Studies highlight that the working conditions for school
teachers are important. But, these studies failed to
indicate the categories of working conditions in their findings.
Research question and objective
Taken into account of this research gap, this study raises
“what are the categories of working conditions?” as a
research question. To answer this research question,
this study attempts to categorize the factors for working
condition.
1
. Senior Lecturer, Faculty of Management and Commerce, South Eastern University of Sri Lanka, Oluvil
Special issue
November 2015
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The conditions in which teachers work matter a great
deal to them and, ultimately, to their students. Teachers
are more satisfied and plan to stay longer in schools
that have a positive work context, independent of the
school’s student demographic characteristics.
Furthermore, although a wide range of working conditions
matter to teachers, the specific elements of the work
environment that matter the most to teachers are not
narrowly conceived “working conditions” such as clean
and well-maintained facilities or access to modern
instructional technology. Instead, it is the social
conditions—the school’s culture, the principal’s
leadership, and relationships among colleagues—that
predominate in predicting teachers’ job satisfaction and
career plans. As Bryk and his colleagues have
documented, improving these social conditions involves
building relational trust between teachers and school
leaders and engaging teachers in co-constructing the
social context of their work (Bryk & Schneider, 2002;
Bryk, Sebring, Allensworth, Luppescu, & Easton, 2010).
Studies have found that in the field of teaching, general
working conditions can be quite ideal. In fact, the working
conditions of teachers such as the convenience of most
school hours and having summer vacations have always
contributed to the appeal of the teaching profession.
However, there is a downside to the working conditions
which prospective teachers must consider. Working
conditions for teachers such as stress, physical strain
on body of teachers, intense work cycles, a large amount
of duties and inappropriate work hours affect job
satisfaction which, in turn, affect job performance.
A number of studies regarding working condition for
teachers have been conducted long ago. Studies revealed
that good training and opportunities for continued
learning, quality teaching is dependent on the
environment in which teachers work. Talented, welltrained teachers are most effective in environments that
support their work and professional growth. Results of
the survey indicate that in many respects, teachers do
view their work environments as supportive. Most
teachers in 1998 felt supported by the school
administration and felt that school goals and priorities
were clear. Survey also indicates aspects of teachers'
work environments that could be improved. One-third of
teachers in 1998 agreed strongly that parents support
their efforts to educate the parents' children, with
elementary school teachers perceiving greater support
from parents than high school teachers.
Research Design and Methodology
This study is a combination of both exploratory and
conclusive research. Problem is defined by exploratory
Special issue
research whereas findings are refined by conclusive
research. Since this study collects data only once from
sample respondents it is a cross sectional study.
Population and sample
Population refers to all the teachers in all schools in
Ampara District, Sri Lanka. Number of Government
schools in island wide is 10012. There are 1074 schools
in Eastern Province. There are 425 schools in Ampara
District. 226983 teachers work island wide. There are
20961 teachers in Eastern Province. 8972 teachers work
in Ampara District. They are shown in Table 1. This study
tried to collect sampling frame for making probability
sampling. But, it was difficult to collect. Thus, this study
collected data from 69 teachers using convenient
sampling method.
Table - 1 : Population and sample
Islandwide
Eastern
Province
Ampara
District
Number of
schools
10012
1074
425
Number of
teachers
226983
20961
8972
Data collection
Data are collected from questionnaire using Undergraduates
of Faculty of Commerce and Management, South
Eastern University of Sri Lanka during the period of 2015.
Data analysis
Data are analyzed using descriptive statistics and
principal component factor analysis using Varimax
Rotation. All these analyses are carried out by SPSS
with the version of 22.
Results and Discussion of Findings
Descriptive Statistics
Descriptive Statistics such as mean and standard
deviation are used in this study. Average number of times
fallen in sickness and ill-health (body weakness) are
2.0290 and 1.7536 with standard deviation of 1.58087
and 0.91404. Mean number of times troubling with
teachers, problem with principal and issue with family
are 1.9710, 4.4638 and 4.9275 with standard deviation
of 1.08426, 2.36755 and 2.45739. Average number of
subjects taught, free subject coverage, teaching aids
and learning material are 58.5072, 62.2609, 55.0725 and
49.2609 with standard deviation of 18.72292, 14.45546,
15.58876 and 7.49834 respectively. Average starting
time, interval time, finishing time and number of staff
(adequate) are 64.4928, 65.9275, 66.1159 and 60.1594
with standard deviation of 12.55180, 9.01521, 7.39343
and 11.10859. Results of the descriptive statistics are
shown in Table 1.
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Table - 2 : Descriptive Statistics
Kaiser-Meyer-Olkin Measure of Sampling Adequacy and Bartlett's Test of Sphericity
Value of Kaiser-Meyer-Olkin Measure of Sampling Adequacy is 0.530. This refers to sample taken in this study is
sufficient. Bartlett's Test of Sphericity is considered by Chi- square. In this study, Approx. Chi-Square is 224.649.
Degrees of freedoms are 78. Chi- square is significant. Table 2 shows the values of KMO and Bartlett's Test.
Table - 3 : KMO and Bartlett's Test
Kaiser-Meyer-Olkin Measure of Sampling Adequacy
Bartlett's Test of Sphericity
0.530
Approx. Chi-Square
224.649
df
78
Sig.
.000
Communalities
Off period time is removed from the analysis since it has the extracted communality value of 0.540. Initial communalities
for sickness, absenteeism, trouble with teachers, problem with principal, issue with family, number of subjects
taught, free subject coverage, teaching aids, learning material, starting time, interval time, finishing time and adequate
staff are 1. Extracted communalities are 0.675, 0.778, 0.724, 0.790, 0.771, 0.768, 0.780, 0.769, 0.889, 0.702,
0.748, 0.826 and 0.729 respectively. Initial and extracted communalities are shown in Table 3.
Table - 3 : Communalities
Initial
Extraction
Sickness
1.000
0.675
Absenteeism
1.000
0.778
Trouble with teachers
1.000
0.724
Problem with principal
1.000
0.790
Issue with family
1.000
0.771
Number of subjects taught
1.000
0.768
Free subject coverage
1.000
0.780
Teaching aids
1.000
0.769
Learning material
1.000
0.889
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November 2015
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Starting time
1.000
0.702
Interval time
1.000
0.748
Finishing time
1.000
0.826
Adequate staff
1.000
0.729
Extraction Method: Principal Component Analysis.
Total Variance Explained
All these 13 variables compose 13 factor components. But, the first six factor components represent around 77%
of the total variance. Thus, these six factor components are the best factor components. Extraction sums of
squared loadings and rotation sums of squared loadings reveal these values. Total variance is shown in Table 4.
Table - 4: Total Variance Explained
Screen plot is a diagrammatical illustration for total variance is explained in Figure 1.
Fig. 1 : Screen plot
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November 2015
Page 128
Factor score
Factor score is calculated by multiplying factor loadings into component score coefficient. Factor score is shown in
Table 5.
Table - 4 : Factor score
Based on the factor score, factors are categorized into general working environmental factors, physical working
environmental factors and social working environmental factors. Categorization of factors is shown in table 5.
Table - 5 : Categorization of factors
Items
Free subject coverage
Component
1
Starting time
Number of subjects taught
General working environment
2
Finishing time
sickness
Categorisation of factors
3
Physical working condition
absenteeism
Physical working condition
Teaching aids
Interval time
4
Adequate staff
Issue with family
5
Learning material
Trouble with teachers
Social working environment
6
Problem with principal
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November 2015
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Categorization of factors and model development
Based on the above categorization, the following model
can be developed for working environment for school
teachers. Developed model is shown in Figure 2.
Physical working
condition
Limitations and further research venues
This study considered only government schools in
Ampara District, Eastern Province of Sri Lanka. Sample
size is limited to 69 which may not be sufficient. Findings
are applicable to Government schools only. Therefore,
future researchers can remove these limitations to
improve this study.
References
Social working
environment
Working environment
for school teachers
General working
environment
•
•
Fig. 2 : Factor categorization and model development
Conclusion
Results of the descriptive statistics showed that average
number of times fallen in sickness and ill-health (body
weakness) are 2.0290 and 1.7536 with standard deviation
of 1.58087 and 0.91404. Mean number of times troubling
with teachers, problem with principal and issue with
family are 1.9710, 4.4638 and 4.9275 with standard
deviation of 1.08426, 2.36755 and 2.45739. Average
number of subjects taught, free subject coverage,
teaching aids and learning material are 58.5072, 62.2609,
55.0725 and 49.2609 with standard deviation of 18.72292,
14.45546, 15.58876 and 7.49834 respectively. Average
starting time, interval time, finishing time and number of
staff (adequate) are 64.4928, 65.9275, 66.1159 and
60.1594 with standard deviation of 12.55180, 9.01521,
7.39343 and 11.10859. Results of the factor analysis
revealed that value of Kaiser-Meyer-Olkin Measure of
Sampling Adequacy is 0.530. This refers to sample
taken in this study is sufficient. Bartlett's Test of
Sphericity is considered by Chi- square. In this study,
Approx. Chi-Square is 224.649. Degrees of freedoms
are 78. Chi- square is significant. Extracted
communalities for sickness, absenteeism, trouble with
teachers, problem with principal, issue with family,
number of subjects taught, free subject coverage,
teaching aids, learning material, starting time, interval
time, finishing time and adequate staff are greater than
0.6. All these 13 variables compose 13 factor
components. But, the first six factor components
represent around 77% of the total variance. Thus, these
six factor components are the best factor components.
It is found that, on the basis of the factor score, factors
are categorized into general working environmental
factors, physical working environmental factors and
social working environmental factors which are then
modeled into model for working environment for school
teachers.
Special issue
•
•
•
•
•
•
•
•
Borman, G. D., & Dowling, N. M. (2008) Teacher
attrition and retention: A meta-analytic and narrative
review of the research. Review of Educational
Research, 78, 376–409.
Boyd, D., Grossman, P., Ing, M., Lankford, H., Loeb,
S., & Wyckoff, J. (2011). The influence of school
administrators on teacher retention decisions.
American Educational Research Journal, 48, 303–
333.
Bryk, A., & Schneider, B. (2002). Trust in schools: A
core resource for improvement. New York: Russell
Sage Foundation.
Bryk, A., Sebring, P. B., Allensworth, E., Luppescu,
S., & Easton, J. (2010). Organizing schools for
improvement: Lessons from Chicago. Chicago:
University of Chicago Press.
Chenoweth, K. (2007). “It’s being done”: Academic
success in unexpected schools. Cambridge, MA:
Harvard Education Press.
Dillon, S. (2010, September 27). 4100 students prove
“small is better” rule wrong. New York Times, p. 1.
Ferguson R., Hackman, S., Hanna, R., & Ballantine,
A. (2010, June). How high schools become
exemplary: Ways that leadership raises achievement
and narrows gaps by improving instruction in 15 public
high schools. Achievement Gap Initiative at Harvard
University, Cambridge, MA.
Johnson, S. M., & Birkeland, S. E. (2003). Pursuing
a “sense of success”: New teachers explain their
career decisions. American Educational Research
Journal, 40, 581–617.
Ladd, H. (2009). Teachers’ perceptions of their
working conditions: How predictive of policy relevant
outcomes? (Working Paper No. 33). Washington, DC:
National Centre for Analysis of Longitudinal Data in
Education. Retrieved March 2, 2011, from http://
www.urban.org/uploadedpdf/1001440-TeachersPerceptions.pdf
Ladd, H. (2011). Teachers’ perceptions of their working
conditions: How predictive of planned and actual
teacher movement? Educational Evaluation and
Policy Analysis, 33, 235–261.
November 2015
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•
•
Loeb, S., Darling-Hammond, L., & Luczak, J. (2005).
How teaching conditions predict teacher turnover in
California schools. Peabody Journal of Education,
80(3), 44–70.
McCaffrey, D., Koretz, D., Lockwood, J. R., &
Hamilton, L. (2004). Evaluating value-added models
for teacher accountability. Santa Monica, CA: RAND.
Special issue
•
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Rivkin, S., Hanushek, R., & Kain, J. (2005). Teachers,
schools, and academic achievement. Econometrica,
73, 417–458.
Rockoff, J. E. (2004). The impact of individual
teachers of student achievement: Evidence from panel
data. American Economic Review, Papers and
Proceedings, 94, 247–252.
November 2015
Page 131
A STUDY ON CUSTOMER AWARENESS ON GREEN INITIATIVES
WITH SPECIAL REFERENCE TO SELECTED
PRIVATE SECTOR BANKS IN ERNAKULAM
Dr. Prakash Pillai 1
Mr. Praveen Raj.D2
Abstract
Green banking initiatives taken by Banks or the concept of Green banking means by effectively using the bank’s
resources with responsibility and care by avoiding waste and giving priority take environmental sustainability into
credit of the organization . It also means promoting environmental-friendly practices and reducing the carbon
footprint from banking operations. Green banking strategies describes how the banking business to be conducted
in such a manner that helps the overall reduction of external carbon emission and internal carbon footprint. Nobody
think about banking is a polluting industry, but the present style of banking operations have considerably increasing
the carbon footprint of banks due to their massive use of energy like lighting, air conditioning, lack of green buildings
electronic/electrical equipments, high wastage of Paper etc .The study made an attempt to understand the awareness
level of customers regarding Green banking initiative taken by various Private sector banks in India, with special
reference to Ernakulam. The study makes an attempt to understand awareness of bank employees and customers
as regards to green banking concept in private sector banks. It is also required to identify different green initiatives
taken by the banks in order attract customer by giving user friendly products.
Key words: E-Banking, Green Banking Initiatives, Green Banking strategies, Customer awareness,
Introduction
The main objective of green banking is to use the
resources in favor of the society and environment. They
provide financial assistance to many green projects
which also ensures the economic growth of the country.
Banks are also promoted different green banking
products for the benefit of environment.
These products include ATM and CDMs, Green Channel
Counters, POS, E- banking, Credit Card and Debit Card
Transactions, E-statements.
When banks conduct green banking activities in large
platform, the customers will also be interested to conduct
their activities with them which will result in better
financial performance for banks The Green initiatives
taken by Banks using all of the bank’s resources with
responsibility and care to limit wastage and giving priority
to various choices that take sustainability into account.
Financial industry plays a major role in promoting
environmentally sustainable and socially responsible
investments as it increases the images of the bank and
better performance. The concept of green banking helps
to create a cleaner and greener future as Green Banking
has a direct impact on the environment .Green initiatives
also gives more weight to environmental factors which
influences the business.. Its aim is to provide good
environmental and social business practices.
Overall green banking is really a good way for people to
get more awareness about global warming; each
businessman will contribute a lot to the environment and
make this earth a better place to live
Green Banking Methods
E- Statements: This is the emerging method of sending
bank statement in the form of Electronic mail. Now a
day’s almost all the banks giving this facility to all its
customers free of cost .which will drastically reduce the
usage of paper and operating time of employees for
preparing these statements. Which also reduces the
storage space for records since all these statements
electronically saved.
Mobile banking : Mobile banking is one of the effective
platforms that we can effectively use by customers and
act as part of green banking initiatives undertaken by
banks. Which setting up direct deposit to receive your
paychecks, receiving electronic statements from your
bank and online bill payment .Which encourages the
bank?
To go green and help the environment. All of these steps
can drastically reduce the amount of paper during
banking transaction. Both mobile banking and Online
banking are highly effective ways to track the finances
and to avoid late payment .Now a day’s almost all the
banks come out different mobile application to perform
1
. Head Dept of Personnel Management, Loyola College of Social Science, Trivandrum.
. Research Scholar, Bharathiar University, Coimbatore.
2
Special issue
November 2015
Page 132
different banking activities which is really useful for the
customers those who are using mobile banking.
conditioning work. Which will improve the green initiatives
of banks and also for the sustainability of environment?
Use of Direct Deposit : Now a day’s bank account is
must for all most all employees and the payment of
salary through bank account only, many of the
employees arranging the facilities like Paycheck through
electronically and ATM cards. This will make the
transaction easier and also reducing the operating cost.
This will effectively saves the time operation by avoiding
travel to bank, Paper, Avoiding paper work of employees
in the bank etc.
Eco –friendly Generators : In olden days all the banks
are equipped with petrol or kerosene Type Generators
those generators polluting the environment in a large
extent and create noise pollution also. Now a day’s
Banks like SBI, SBT, ICICI banks are purchasing and
installing only eco friendly higher energy efficient Diesel
generators.
Online Bill Payments : Banks and all retailers
encouraging their customers to pay the bill electronically
now it is the part of life style of people especially among
youths. The payment of bills includes Telephone bills,
mobile recharge, utility bills, credit card payments and
various application fees for competitive exams can all
be paid in the form of online payment. We can say that
now a day’s many online banking customers have already
thrown their traditional kind of cheque books and make
use of online payments facilities.
Net Banking : Net banking facility is one of the most
popular method green banking technology performed by
the banks for different banking. All most all the banks
having core banking facility provides this service free of
cost to its customers .which I will reduce the operating
cost of banks drastically and which can perform
throughout the day.
Credit and Debit Cards : The service offered by Credit
card and debit card can be used for making the payment
of various expenses without caring the money with the
customers. This will increases the security of customers
during traveling by avoiding carrying of huge amount of
currencies with them.
Electronic Fund Transfer : Transfer of fund through
electronically is known as electronic fund transfer (EFT),
uses computer and electronic technology as a substitute
for checks and other paper transactions in banks . Most
of the banks providing this facility as optional along with
Online or ATM facilities to their customers who are
performing large amount of fund transfer continuously
Use of Higher efficient lights : Now the banks are
using only higher efficiency T5 series light or Led fitting
in the banks to saves the energy so as to reduce the
cost operation. Banks are advised their employees to
switch off the light fan which are not required.
Higher efficiency Air-conditioners : Air-condition of
branches are very common in almost all part of country,
different gases emitted from this is hazards to
environment. Now day’s banks are using higher
efficiency eco friendly air-conditioners for bank air-
Special issue
Literature Review
Bahl, Sarita (2012), conducted an empirical study Green
Banking- The new Strategic Imperative on public sector
banks and collected manager’s views on green banking
financial products, carbon footprint reduction by
paperless banking, and carbon footprint reduction by
energy consciousness, green building and social
responsibility services. She found that carbon footprint
reduction by green building had been given top priority
in green banking strategies.
Yadav and Pathak (2013) conducted a study on Green
Banking initiatives implemented by private and public
bank for sustainable environment. They concluded that
Indian banks were under stod the Importance for taking
initiatives environmental sustainability. Result of the study
conducted stating clearly that that public sector banks
have taken more initiatives as compared private sector
in general.
Kumar Sudesh and Anjum Bimal (2014) conducted a
study on customer satisfaction on E- banking and made
a conclusion that E-banking technology can overcome
the traditional style business of retail banking and able
to reduce the processing and operational cost , Ebanking is the emerging technology which providing their
customers to conveniently do their banking transactions
at a time that make them and can access their bank
account for 365 days. Better ways of customer services
are essential for the growth of a banking industry. The
effect of e-banking facilitate the existing banking and
payment mechanisms, cheaper transactions, faster
delivery channel, more secure, and more convenient way
of operation.
Naidu Kanchana and Paramasivan (2015) stated in the
study that the concept Green Banking will be mutually
beneficial to the industries, economy and banks. This
ensures the greening of the industries and also facilitate
in improving the different asset quality of the banks for
future business. Green banking is really a good way for
customers to get more awareness about sustainability
and crate awareness on each business to contribute a
lot to the environment and make the environment more
sustainable.
November 2015
Page 133
Bhal (2012) explains the means of creating awareness
about Green Banking to ensure sustainable growth. They
used Garrettt’s ranking technique to analyze the different
strategies with regards to Green Banking. They clearly
stated after the study that If the sustainable development
of environment can be attained only through creating
awareness and educate the entire stake holders about
green initiatives.
Jha and Bhome (2013) conducted study a to check the
consumer awareness on Green Banking and they
explains certain steps to be needed to implement strongly
in Green Banking technology for strengthening it . Online
Banking, Green Checking Accounts (ATM, Special Touch
Screens), Green loans for the benefit of environment
friendly residential projects, power saving equipments,
Saving of Paper ,Mobile Banking are among few steps
suggested by them after their study. Green Banking
will also ensure organization’s move towards more
sustainable environment
Sharma, Gopal (2014) made an attempt to study the
level of consumer awareness of Green Banking initiative
in India with special reference to Mumbai. From the
survey they conducted and found that those people who
are using online facilities provided by respective banks
nearly three fourth of them are unaware of the term Green
Banking even though they are using the facilities offered
by green technology . They also found that among those
who are aware of Green Banking technology believes
that it’s mainly related to only online bill payment and
various cash transaction services.
This paper is based on descriptive study conducted
among the customers of private sector banks in
Ernakulam about their awareness on green banking
Technology .For this structured questionnaire was framed
and is used to collect the primary data for the study.
The data were analyzed with the help of statistical tools
like percentage analysis and Anova.
Data Collection
Data collection method of the study is primary data
collection. The data collected directly from the sample
respondents through by questionnaire from the
customers of private sector banks in Ernakulam.
Respondent having sound educational background with
a degree of awareness with reference to green products
were targeted and approached for the study. The
convenient sampling method is used for the study and
the sample size taken as 100 numbers.
Objectives of the study
The main objectives of the study are as follows:
Special issue
To find out the level of awareness of costumer’s in
Ernakulam about green banking.
To analyze the satisfaction level of the customer towards
green Banking Technologies.
To identify the awareness level of the customers about
Green Banking policies
Hypothesis
The hypothesis framed for the study is there is no
significant relationship between the demographic profile
of the customers and their awareness about green
Banking initiatives
Demographic profile of customers
During the research period researcher made an attempt
to analyze the awareness level of the customers about
the green banking initiatives taken by the banks .The
null hypothesis framed for the purpose is there is no
significant difference between the demographic profile
of the customers and their awareness level of green
initiatives of the banks.
ANOVA Analysis is performed to test the hypothesis
and the results obtained is describing in the table below
Table - 1
Variables
Tested value
Inference
Gender
0.071
accepted
Education
0.043
rejected
Age
0.034
rejected
Income
0.684
accepted
Job
0.748
accepted
The above table describes test result of Anova analysis,
the calculated value for the variables other than age and
education are greater than 0.05 is acceptable. So the
hypothesis is rejected for the variable education and age.
So we can conclude that the awareness level of
customers towards green banking initiatives differ with
respect to their educational qualification and age their
age factor and all other factors have no influence over
the awareness level of green initiatives in banks.
Green Initiatives of Banks and its awareness among their
customers (Table - 2)
By critically analyze the above data, We can conclude
that that green initiatives like, Concession for eco-friendly
business, Solar Powered ATMs, recycling of used items
are emerging green banking initiatives that are not
properly promoted by the respective banks according
to the customers participated in the survey. 68% of the
customers are not aware about the environmental policy
of the banks .This clearly states that banks are not
properly disclose their environmental policy to the
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Table - 2 : Green Initiatives of Banks and its awareness among their customers
Si No
Aware (%)
Green Banking Steps
Not aware
(%)
1
Controlled use of energy for energy saving
62%
38%
2
Facility for e-statements
67%
33%
3
Reduced wastage of papers with the use of Net banking facilities
62%
38%
4
Use of Solar powered ATMs in remote centers
24%
76%
5
Energy – efficient lighting in branches and offices
64%
36%
6
Providing recyclable debit cards and credit cards to customers
47%
53%
7
Higher efficiency air-conditioning system
68%
32%
8
Usage of recycle paper or recycle waste
34%
66%
9
Fund Transfer through ATM and CDM
71%
29%
10
Workshops and Seminars about Green banking conducted by banks
27%
73%
11
Banks Environmental Policy
32%
68%
12
Energy savings/operation cost through Net banking approach
64%
36%
13
Online Bill Payment facilities offered by banks
74%
26%
14
Concession for eco friendly business
38%
62%
customers However, these concepts are new in India
may be a probable reason for poor awareness level
among consumers. But when we compare the awareness
level of the factor seminar and workshops organized by
banks, we can come to a conclusion that the initiative
taken for create awareness about green banking to
customers is not effective. Banks should definitely take
necessary steps to create awareness among the
customers about green initiative strategies for its better
implementation.
At the same time about 60 % of the respondents were
known to many green banking initiatives such as , Estatement facility ,Controlled use of energy ,Online Bill
Payment , Electronic fund transfer system, Net Banking
facility , Energy efficient air –conditioning system.
While critically evaluate the data we can say that many
of the respondent are enjoying the benefit of Green
Banking Technologies like ATM , online banking, mobile
banking , e-statements but many are not aware of the
terminology green banking. This is the point where banks
lacking in promote the Green banking strategies to
stakeholders.
Conclusion
Green banking can be effectively implemented only with
the involvement of al stake holders especially the
customers and employees. Many of the green banking
Special issue
initiatives like, Concession for eco-friendly business,
Solar Powered ATMs, recycling of used items are the
emerging green banking initiatives that are not properly
promoted by the respective banks .Green initiatives in
banks in India is still a major issue while considering
with the development of country .Banks and other financial
institution should play major role for maintaining and
improving the sustainability.
We can conclude that banks should take new initiatives
and promote different green banking products. Banks
also create awareness program about the Green banking
initiatives among its customers more effectively since
the customer’s plays major role in that. Many of the
banks having environmental policies but it was not
properly reached to customers .They also adopt different
strategies for the promotion of environment friendly
policies. Banks should also design Green banking
technologies which will ensure the efficient use of
resources of the country so as to ensure energy
conscious world for better future. Employees of Financial
Industry must consider green banking as a necessity
rather than desirability otherwise Green Banking policies
will not reach to the customers. All the employees and
customers will put together their hands for the sustainable
growth which will definitely result sustainability of the
environment.
November 2015
Page 135
References
• Bahl, S. (2012). The role of green banking in
sustainable growth. International Journal of
Marketing, Financial Service & Management
Research, 1(2)
• Jha,N.&Bhome,S.(2013).A study of green banking
trends in India. Abhinav International Monthly Journal
of Research in Management & Technology. Vol (II).
• Sharma, N., Sarika, K. & Gopal, R. (2014). A study
on customer’s awareness on Green Banking
initiatives in selected public and private sector banks
with special reference to Mumbai. IOSR Journal of
Economics and Finance,2(14).
• Sudesh Kumar and Bimal Anjum (2014), Electronic
Banking: An Emerging Way of Customer Services,
Research Journal of Management Sciences 3(4)
• Naidu Kanchana and Paramasivan (2015), A study
on green Banking trend in Indaia ,Research Explorer
IV(10).
Special issue
•
•
•
•
K.Sudhalakshmi and Dr.K.M.Chinnadorai(2014), A
Study on Customer’s Awareness on Green Banking
Initiatives in Selected Private Sector Banks with
Special Reference to Coimbatore City,The
International Journal Of Business & Management
,2(4).
Sharma, N., Sarika, K. & Gopal, R. (2014). A study
on customer’s awareness on Green Banking
initiatives in selected public and private sector banks
with special reference to Mumbai. IOSR Journal of
Economics and Finance,2(14).
K.J Sathana and Sunmista (2014), Green Banking
Initiatives of Commercial banks-Employees
Perspectives, Global journal of research and
analysis,3(12).
Yadav, R. & Pathak, G. (2013). Environmental
Sustainability through Green Banking: A Study on
Private and Public Sector Bank in India. OIDA
International Journal of Sustainable Development. Vol
6(8).
November 2015
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A STUDY ON WORK LIFE BALANCE OF WOMEN
EMPLOYEES IN BPO SECTOR
DR. R. Devi1
Abstract
Work – life Balance of women employees has become an important subject since the time has changed from men
earning the family living in today’s world where both men and women equally share the responsibility of earning for
the betterment of their family life. Hence it is for the betterment of their family life. Women have become equal
participants in many respects at all levels of society. Work-life balance is about creating and maintaining supportive
and healthy work environments, which will enable employees to have balance between work and personal
responsibilities and thus strengthen employee loyalty and productivity.
Key words: Words: Work life balance, Career growth.
Introduction
The BPO sector in India has several distinguishing
features-its high degree of integration into the global
economy, relative freedom from state controls and
dependence on a steady supply of highly educated
“knowledge workers”. Work in the BPO sector ranges
from relatively ‘low end’ to ‘high end’ solutions and
products. Apart from job mobility, there is also a high
level of geographical mobility in this sector. Indian BPO
services still have a fairly high proportion of such onsite
work, in which employees are located at the client site
for stints of a few months to more than a year.
Work Life Balance of Women Employees
Many women are unwilling or unable to put in as many
hours as their male counterparts, for several reasons.
Married women are less likely to be able to stay in the
office till late night, unless there is a pressing need,
because they may face objections from their parents or
in-laws or social disapproval. While young bachelors find
a social life in the office that motivates them to stay
late, women rarely become part of this camaraderie and
in fact the men might find women’s presence to be a
drag. Also, women need to reach home safely although
companies usually arrange for drops in the night.
Interruptions in women’s careers due to child bearing
have particularly adverse effects on their growth, given
the rapid changes in technology and the need to keep
abreast of new developments. Most companies give three
month’s maternity leave with option of an additional three
months’ unpaid leave and some offer women the option
of returning to work after maternity leave on a part-time
or consultancy basis or may allow them to work from
home, for a year or more. Some companies even allow
women to take leave without pay for a year.
Cecilia (2013) revealed that the women’s jobs were
grouped into four large categories at the bottom of the
ranking, assigned to the lowest wage ranges; the men’s
jobs were in many more categories extending over a
much wider range of wage levels. The evaluation of the
clerical/secretarial categories showed that many different
jobs with different tasks and responsibilities, some highly
skilled and responsible, had been lumped together
Joanne and Meyer son (2012) studied that the
managerial ranks now contained women in many
organizations, but secretaries, clerks, servers and care
providers were still primarily women. Women were
beginning to be distributed in organizational class
structures in ways that were similar to the distribution
of men. Gender and class were no longer so perfectly
integrated, but gendered and sexualized assumptions
still shape the class situations of women and men in
different ways.
Joanne and Meyer son (2011) in a study of high-level
professional women in a computer development firm
found that the women saw the culture of their work group
as highly masculine, aggressive, competitive, and selfpromoting. The women had invented ways to cope with
this work culture, but they felt that they were partly
outsiders who did not belong.
Wacjman (2010) found that in any organizations, women
and men managed in the same ways. Women managers
and professionals often faced gendered contradictions
when they attempted to use organizational power in
actions similar to those of men. Women enacting power
violated conventions of relative subordination to men,
risking the label of “witches” or “bitches.”
1
. Assistant Professor, Department of Corporate Secretary ship, K.C.S Kasi Nadar College of Arts & Science, Chennai
Special issue
November 2015
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Ely and Meyer Son (2009) found in some organizations, women managers worked quietly to do the organizational
housekeeping, to keep things running, while men managers rose to heroic heights to solve spectacular problems.
Need For the Study
Given the nature of work culture in BPO sector, it is no wonder that most of male would not prefer to marry women
in the same profession; they are well aware of the heavy commitment of time and energy involved and prefer wives
who are willing to stay at home to look after the family or who have less stressful jobs. Most women BPO
employees, on the other hand, they prefer husbands working in BPO sector, because they would be better able to
understand the demands of job. This mismatch between BPO women’s and men’s expectations in terms of marriage
is asymptomatic of the ways in which gender relations are being altered by the entry of women into this new kind of
workforce.
1. To examine the effect of work life balance on women’s performance and work attitude.
2. To analyze the organizational factors affecting the work life balance in BPO sector.
Scope of the Study
The purpose of this study is to provide top management with information from which a sound HR policies especially
women employees may be devised. The identification of unique characteristics and issues for women employees
should assist the management with specialized work-life balance factors designed around very specific and unique
tasks of their women employees.
• Primary data was collected from the 50 respondents by questionnaire method.
• Secondary data was collected from journals and Research articles to support the research.
Limitations of the Study
The present study is based on the primary data collected from the women employees of BPO companies. Hence,
the drawbacks and limitations of the field level survey are very much applicable to the present research. The data
and information collected from the respondents are subjected to recall bias.
Analysis and Interpretation
The weighted mean of factors affecting the work-life balance of women employees in BPO sector
S.No
Work- life Balance Factors
Weighted
Mean
Status
1
According to me women are able to strike a balance between success at
work and personal life
4.50
Agreed
2
Late working hours have hampered my family life
3.77
Agreed
3
There have been instances where my family has not recognized that my
work pressures may require me to reprioritize my home commitments
3.81
Agreed
4
Without flexi timings it will be difficult for me to work in the organization
3.84
Agreed
5
In my experience, flexi timings facilitate productivity in women
4.05
Agreed
6
Women find it difficult to maintain work life balance
4.53
Agreed
Results and Summary
From the results, it is observed that all the work-life balance factors , according to women are able to strike a
balance between success at work and in personal life, late working hours have hampered her family life, there have
been instances where her family has not recognized that her work pressures may require her to reprioritize her
home commitments, Without flexi timings it will be difficult for her to work in the organization, In her experience,
flexi timings facilitate productivity in women, Support structure provided by her family helps in career advancement,
Women find it difficult to maintain work life balance are agreed by women employees in BPO sector.
Special issue
November 2015
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Policy on Work-Life-Balance In Organizations
If an organization needs to be successful with committed
and productive women, it needs to not only lay down
schemes and strategies, but also needs to formulate
policies and guide lines that can monitor these schemes.
The following steps are mandatory to formulate the policy
on WLB.
• Identification of the need for introducing WLB Policy.
• Creation of a Task-force that can lead this activity.
• Formulate the policy on WLB based on the company’s
vision & mission’s statement.
• Form a committee that comprises of representatives
from management as well as workers category.
• Conduct workshops to enhance knowledge and
necessity of this policy.
• Communicate the policy to all the employees.
•
Implement the policy of maintain regular feedbacks
& suggestions.
• Register and record each activity of the committees/
Taskforce.
• Update any changes that have been made to all
employees.
• Make the policy reachable and understandable by
all.
Special issue
Conclusion
The organization and management should become
sympathetic to women employees’ commitments and
excuse them from working late, contacting at unsociable
hours, scheduling meetings at odd hours, sending them
for frequent tours unless very much required. This in turn,
will reduce their work pressures, offer them space to
attain work-life balance and increase their productivity
and commitment.
References
• Campbell DJ, Campbell KM, Kennard D. The effects
of family responsibilities on the work commitment
and job performance of non professional women. J
Occupant Organ Psych 1994; 67:283-96.
• White B. The career development of successful
women. Women Manage Rev 1995; 10:4- 15.
• Green haus JH, Beutell NJ. Sources conflict between
work and family roles.
• McCartney, C. (2003), “Work/ life Balance: The Role
of the Manager” Training.
November 2015
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ASSOCIATION BETWEEN CRITICAL, CREATIVE THINKING
AND PROBLEM SOLVING IN ACCOUNTING
RESEARCHES : AN OVERVIEW
Dr.B. Nimalathasan1
Abstract
The paper is attempted to focus on association between critical, creative thinking and problem solving in accounting
researches. The professional accountant must possess thinking skills (i.e., inquisitiveness; open-mindedness; patience,
thoroughness, and perseverance) to operate in an increasingly complex environment. These skills assist accountants
in problem solving and decision making in general, and in professional research activities in particular. The present
study is based on the secondary data. The collected data may be processed and analysed in order to make the
present study useful to the readers, interested parties and policy makers of the concern area. Further, the present
study also tries to contribute to this literature by doing the research.
Key words: Critical; Creative Thinking; Problem Solving and Accounting Researches.
Introduction
The professional accountant must possess thinking
skills (i.e., inquisitiveness; open-mindedness; patience,
thoroughness, and perseverance) to operate in an
increasingly complex environment. These skills assist
accountants in problem solving and decision making in
general, and in professional research activities in
particular. Critical and creative thinking go beyond these
attributes to include a number of other specialized skills.
For example, a critical thinker must have the skill of
relating the known to the unknown for effective problem
solving and decision making.
It is important for accountants to possess critical and
creative thinking skills. Not surprisingly, surveys indicate
that over 95 percent of audit partners and corporate
controllers view thinking skills to be important for the
practicing accountant (Novin, Pearson & Senge, 1990).
The importance of critical thinking to accounting in the
professional literature is generally referred to as
professional scepticism.
Objectives
The following objectives have been considered.
1. To understand the philosophy and concept of critical,
creative thinking.
2. To know the difference between critical and creative
thinking;
3. To identify the relationships between critical, creative
thinking and problem solving in complex environments
4. To suggest the some measures to solve the problems
through critical and creative thinking techniques.
Methodology
The present study is based on the secondary data. In
this regards, Neuman’s (1997) document analysis is very
useful for systematic analysis of a particular topic.
Therefore, data were collected from published and
unpublished materials, books, newspapers and ongoing
academic working papers. The collected data may be
processed and analysed in order to make the present
study useful to the readers, interested parties and policy
makers of the concern area.
Analyses of findings
Critical thinking, and its closely related concept of
creative thinking, means different things to different
people. The situation makes the specification of
generally agreed upon definitions of critical and creative
thinking difficult. Nevertheless, there are several common
clues that can help define these concepts. In this
section, these concepts are defined and their differences
are identified. The analyses of findings have been
discussed under the following sub-heads.
Critical
Critical has its root in the Greek word Kriticos, or critic,
that means to question, to make sense of, to analyze,
and to form judgements of the merits, faults, value, or
truth of a matter. It is by questioning and analysing that
you can examines your thinking and the thinking of
others. Because of this questioning and analysing, the
word critical is sometimes confused with the word
criticize, which is to find fault with. This confusion results
in a negative connotation for the word critical, but this is
not the purpose of critical thinking. The word critical in
critical thinking is used in a more constructive manner.
1
. Department of Accounting, Faculty of Management Studies & Commerce, University of Jaffna, Sri Lanka.
Special issue
November 2015
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It is used for making sense of and for analysing for the
purpose of developing a better understanding.
Thinking
Thinking is a natural process, but left to itself, it is often
biased, distorted, partial, uninformed, and potentially
prejudiced; excellence in thought must be cultivated
(Scriven and Paul, 2004).
Thinking is a mental activity that helps formulate or solve
a problem, make a decision, or fulfil a desire to
understand. It is a searching for answers, a reach for
meaning (Ruggerio, 1988). Thus, thinking is an active,
purposeful, and organized process (Chaffee, 1990). It
refers to a variety of complex cognitive activities (e.g.,
generating and organizing ideas, forming and applying
concepts, designing systematic plans of action,
constructing and evaluating arguments, exploring issues
from multiple perspectives, and applying knowledge to
new situations ( Chaffee,1992). All of these cognitive
activities are useful in the practice of accounting.
Critical Thinking
Critical thinking is, very simply stated, the ability to
analyze and evaluate information. Critical thinkers raise
vital questions and problems, formulate them clearly,
gather and assess relevant information, use abstract
ideas, think open-mindedly, and communicate effectively
with others. Passive thinkers suffer a limited and egocentric view of the world; they answer questions with
yes or no and view their perspective as the only sensible
one and their facts as the only ones relevant. Critical
thinking is an important and necessary skill because it
is required in the workplace, it can help you deal with
mental and spiritual questions, and it can be used to
evaluate people, policies, and institutions, thereby
avoiding social problems (Hatcher and Spencer, 2005).
There have been many definitions of critical thinking over
the years. Norris (1985) posited that critical thinking is
deciding rationally what to or what not to believe. Elder
and Paul (1994) suggested that critical thinking is best
understood as the ability of thinkers to take charge of
their own thinking. Harris and Hodges (1995) declared
critical evaluation as the process of arriving at a judgment
about the value or impact of a text by examining its
quality.
Halpern (1996) defines critical thinking as "…the use of
cognitive skills or strategies that increase the probability
of a desirable outcome." Other definitions include: the
formation of Logical inferences (Simon & Kaplan, 1989),
developing careful and logical reasoning (Stahl & Stahl,
1991), deciding what action to take or what to believe
through reasonable reflective thinking (Ennis, 1991), and
purposeful determination of whether to accept, reject,
or suspend judgment (Moore & Parker, 1994).
Special issue
It follows that critical thinking is an active, purposeful,
and organized process of thinking about one’s own
thinking (Chaffee, 1990). An implication of this definition
is that one critically evaluates the logic and validity of
information, develops evidence to support or refute his
or her views, carefully analyzes situations, and discusses
subjects in an organized way. Thus, critical thinkers do
not only seek evidence to support their own views, but
also other alternative perspectives. Upon an active,
purposeful, and organized examination of our current
thinking, we realize that a modified, or a qualified, or
even an adverse opinion could be issued due to some
material misstatements that were discovered. (Mead
Data Central Inc, 1995). This is where our critical
examination of our own thinking and the process of
collecting additional evidence will help you make your
final decision.
Creative Thinking
Creative thinking refers to original or imaginative thinking
to produce innovative solutions or alternative courses of
action that are useful for problem solving and decision
making. For example, a company might only be willing
to acquire another entity if it can account for the
acquisition by the pooling of interest method rather than
the purchase method. In the pooling of interest method,
the acquire simply combines the financial statements
of the acquired company with its own, thereby avoiding
recognition of goodwill. In the purchase method, the
excess amount paid over and above the acquired
company’s tangible net worth is recorded as goodwill.
Creative thinking is different from “creative accounting”,
in which an accountant might try to intentionally
manipulate accounting numbers to achieve a desired
outcome such as income smoothing.
Differences between Critical and Creative Thinking
To differentiate critical thinking and creative thinking
consider how the mind works (Ruggero, 1988). The
human mind has two phases: (1) production and; (2)
judgement. In the production phase, a person
conceptualizes a problem and thinks of various ways to
solve it. This phase is creative thinking because it involves
the mind in an imaginative and innovative solutionproducing mode. In the judgement phase, the person
examines and evaluates alternative courses of action,
thus making a critical judgement about the merits of
various courses of action.
Critical thinking and creative thinking take a highly
complex role in problem solving and decision making.
High levels of critical and creative thinking are needed
for more complex problems and decision-making
situations. These situations require much judgement and
decision making that go beyond simple solutions. As
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stated by National Council of Teachers of English, critical
thinking is a process that stresses an attitude of
suspended judgement, incorporates logical inquiry and
problem solving and leads to an evaluative decision or
action (French, 1992).
The Association between Critical, Creative thinking
and Problem Solving
Critical thinking may be required to identify an appropriate
explanatory. This is because the task requires the
understanding of a particular meaning and generation of
new knowledge based on established accounting or audit
standards. The critical thinker uses basic skills of
relationship, transformation, and causation to generate
new reasons, proof, or theory.
On the other hand, in a creative thinking context, the
thinker is creating a novel idea, say a new method of
revenue recognition for a unique exchange transaction
or an estimation method to value stock option plans.
Basic skills of qualification, relationship, and transformation
may be used to generate the new meanings, ideas, or
methods.
In a problem-solving context, the standard-thinking skills
needed are caution and transformation. Causation
establishes the link between the cause and effect and
transformation processes the information from input to
output. For example, in a depreciation calculation
problem, causation is used to establish the usage (cause)
depreciates an asset (effect). The depreciation method
used transforms the problem through the depreciation
formula to a depreciation expenses.
In decision making context, the decision maker selects
the best course of action from among several alternative
course of action. The standard thinking skills used is
classification and relationship. The outcome from this
process is the decision.
Policy Implications
Although the present study was confined to critical,
creative thinking and problem solving in accounting
researches, it may be appropriate to state briefly the
policy implications for the study. In this context, the
following policy actions may be considered worthwhile
Check sheet
An important tool that problem-solving groups use to
record data is a check sheet. The type of check sheet
used depends on whether you need to record the number
of events by type within a specific time period; the work
flow through a department; or the type, duration, and
cause of each of several events.
Fishbone Diagram
Applicable to a wide range of situations, the Fishbone
Diagram may be used not just to analyze causes but
Special issue
also as a primarily creative way to generate possible
solutions.
Force-Field Analysis
Developed by social psychologist Kurt Lewin as a
visualization technique, Force-Field Analysis describes
a problem as a balance of oppositions: driving forces,
which push to improve the current situation, and restraining
forces, which push to worsen it.
Delphi
The Delphi technique applies to a wide variety of
situations, especially when group problem-solving has
been weakened because not all members are
contributing ideas.
Collages
If our group is working on a problem that is abstract and
intangible, you may find it very difficult to describe and
discuss it among ourselves as well as with colleagues
and management. This situation is almost impossible
to resolve without using collages to create a visual
message that will help us put our ideas into words. A
powerful technique, collages can prove useful in a
surprising variety of situations. Because this exercise
is likely to be new and unusual for most members, the
use of collages resembles swapping in calling upon the
skill and sensitivity of the facilitator.
Swapping
Designed specifically for groups in which opposing
camps have deadlocked, swapping encourages the two
sides to listen to each other by having each present the
opposition’s case.
Cost-Benefit Analysis
Cost-benefit analysis is an examination and comparison
of the costs incurred in pursuing a course of action and
the benefits that will be derived from doing so.
Brainstorming
It is a group creativity technique designed to generate a
large number of ideas for the solution of a problem.
Although brainstorming has become a popular group
technique, researchers have not found evidence of its
effectiveness for enhancing either quantity or quality of
ideas generated. Because of such problems as
distraction, social loafing, evaluation apprehension, and
production blocking, brainstorming groups are little more
effective than other types of groups, and they are actually
less effective than individuals working independently.
Presentation
General principles of presentation are covered in detail
in the Communication module in this Continuing
Education series.
November 2015
Page 142
Concluding Remarks
Critical thinking is an active and purposeful thinking process
that is required to perform contemporary accounting and
auditing tasks. Several task characteristics (e.g., task
novelty) were identified as those that require critical
thinking. It was also noted that several action- oriented
attributes such as meaning imposition are necessary to
understand the tasks and to perform them effectively.
•
•
•
References
•
•
•
•
•
•
•
•
•
Chaffee, J.(1990). Thinking Critically, 3rd ed, Boston,
MA: Houghton Mifflin,34.
Chaffee, J.(1992). Teaching Critical Thinking across
Curriculum in New Directions for Community
Colleges, 77, 25.
Elder, L., & Paul, R. (1997). Critical thinking: Crucial
Distinctions for Questioning. Journal of
Developmental Education 21(2), 34.
Ennis, R. H. (1991). Critical Thinking: A Streamlined
Conception. Teaching Philosophy, 14 (1), 5-24.
Halpern, D.F. (1996). Thought and Knowledge: An
Introduction to Critical Thinking.
Mahwah, NJ: Lawrence Erlbaum Associates,
Publishers.
Harris, T., & Hodges, R. (Eds.). (1995). The Literacy
Dictionary, Newark, DE: International Reading
Association, 48.
Hatcher, D. L., & Spencer, L. A. (2005). Reasoning
and Writing: From Critical Thinking to Composition.
3rd. ed. Boston: American Press.
Moore, B.N., & Parker, R. (1994). Critical Thinking.
Mountain View. CA: Mayfield.
Special issue
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•
•
•
•
•
•
Norris, Stephen P. (1985).Synthesis of Research on
Critical Thinking. Educational Leadership, 42(8), 4045.
Neuman, W.L. (1997). Social Research Methods:
Qualitative and Quantitative approaches Boston: Allyn
and Bacon.
Novin, A.M., Pearson, M.A., & Senge, S.V. (1990).
Improving the Curriculum for Aspiring Management
Accountants: The Practitioner’s Point of View,
Journal of Accounting Education, 8,207-224.
Ruggerio, V.R.(1988). The Art of Thinking: A Guide to
Critical and Creative Thought,2nd ed, New York:
Jarper & Row,
Simon, H.A., & Kaplan, C.A. (1989). In M.I. Posner
(Eds.), Foundations of Cognitive
Sciences Cambridge, MA: MIT Press, 1-47.
Stall, N.N., & Stahl, R.J. (1991). We Can Agree after
All: Achieving a Consensus for a
Critical Thinking Component of a Gifted Program
using the Delphi Technique. Roeper Review, 14(2),
79-88.
Scriven, M., & Paul, R. (2004). The Critical Thinking
Community. Retrieved November 28, 2005, from http:/
/www.criticalthinking.org/aboutCT/definingCT.shtml.
The exact proportion of standard unqualified reports
to all audits performed is difficult to quantify. However,
in a search of annual reports between 1984 and 1994
in the Lexis/ Nexis Research Software (Mead Data
Central Inc., 1955) NAARS database.
November 2015
Page 143
EMANATION OF WOMEN-INHERITED BUSINESS
IN INDIA – AN INSIGHT
Dr.R. Vimal Nishant 1
Abstract
In the era of Liberalization, Privatization and Globalization along with ongoing Information Technology revolution,
today’s world is changing at a surprising pace. Political and Economic transformations appear to be taking place
everywhere as countries convert from command to demand economies, dictatorships move toward democratic
system, and monarchies build new civil institutions. These changes have created economic opportunities for women
who want to own and operate businesses.Today, women entrepreneurs represent a group of women who have broken
away from the beaten track and are exploring new avenues of economic participation. Among the reasons for women
to run organized enterprises are their skill and knowledge, their talents, abilities and creativity in business and a
compelling desire of wanting to do something positive. It is high time that countries should rise to the challenge and
create more support systems for encouraging more entrepreneurship amongst women. At the same time, it is up to
women to break away from stereotyped mindsets. This paper focuses on the concept of woman entrepreneurs in
India; their traits in business, the problems faced by them when they set up and make some suggestions for future
prospects for development of Women Entrepreneurs.
Key words : Entrepreneurship development, Women entrepreneurs, problems, future prospects, India.
Introduction
In this dynamic world, women entrepreneurs are a
significant part of the global expedition for sustained
economic development and social progress. Due to the
growing industrialization, urbanization, social legislation
and along with the spread of higher education and
awareness, the emergence of Women owned businesses
are highly increasing in the economies of almost all
countries.
Women entrepreneurs are fast becoming a force to
reckon with in the business world and are not only
involved in business for survival but to satisfy their inner
urge of creativity and to prove their capabilities. Educated
Women is contributing to a great extent to the social
transformation and in the future, will be seen that more
women venturing into areas traditionally dominated by
men.
Today’s women are taking more and more professional
and technical degrees to cope up with market need and
are flourishing as de signers, interior decorators,
exporters, publishers, garment manufacturers and still
exploring new avenues of economic participation. It is
perhaps for these reasons that Government Bodies,
NGO’s, Social Scientists, Researchers ‘and International
Agencies have started showing interest in the issues
related to entrepreneurship among women in India.
Women entrepreneur’s explore the prospects of starting
a new enterprise; undertake risks, introduction of new
innovations, coordinate administration & control of
business & providing effective leadership in all aspects
of business and have proved their footage in the male
dominated business arena.
Concept of “Women” as an entrepreneur in India:
Entrepreneurship has gained currency across the sphere
and female- entrepreneurship has become an important
module. India is one of the fastest emerging economies
and the importance of entrepreneurship is realized across
the gamut.
“Women Entrepreneurship” means an act of business
ownership and business creation that empowers women
economically increases their economic strength as well
as position in society. Women-entrepreneurs have been
making a considerable impact in all most all the
segments of the economy.
Pandit Jawaharlal Lal Nehru has remarked “When
women move forward, the family moves, the village
moves and the Nation moves.” Women Entrepreneurs
have been making a significant impact in all segments
of economy of the world. Their willingness for the future
is apparent in their growing confidence, in their strengths
and in their desire to seek different forms of work in order
to achieve a new balance between work and home.
In the words of Former President APJ Abdul Kalam
"empowering women is a prerequisite for creating a
good nation, when women are empowered, society
with stability is assured. Empowerment of women is
essential as their thoughts and their value systems
lead to the development of a good family, good society
and ultimately a good nation."
1
. Associate Professor and Head, Department of MBA, Excel Business School, Namakkal District, TN, India
Special issue
November 2015
Page 144
Thus a women entrepreneur is one who starts business
and manages it independently and tactfully takes all the
risks, accepts challenging role to meet her personal
needs and become economically independent. A strong
desire to do something positive is an inbuilt quality of
entrepreneurial women, who is capable contributing
values in both family and social life and is one who faces
the challenges boldly with an iron, will to succeed.
Traits of Women Entrepreneurs in India
Women are ambitious
A successful woman entrepreneur is dreadfully strongminded one, has an inner urge or drives to change
contemplation into realism. Knowledge from her previous
occupancy as an employee, relying on educational
qualifications or lessons learnt from inborn business,
she is ready to grab opportunities, sets goal, possess
clear vision, steps confidently forward and is ambitious
to be successful. Every successful woman entrepreneur
is truly determined to achieve goals and make her
business prosper. Thorough knowledge of the field is
indispensable to success. She comes with new innovative
solutions to old problems to tide over issues.
Women are confident
A successful woman entrepreneur is confident in her
ability. She is ready to learn from others, search for help
from experts if it means adding value to her goals. She
is positive in nature and is keener to take risks. A winning
woman entrepreneur uses common intelligence to make
sound judgments when encountering everyday situations.
This is gleaned from past experience and information
acquired over the years. It is essential not to get
aggravated and give up when you face obstacles and
trials. The aptitude to explore uncharted territories and
take bold decisions is the hallmark of a successful
woman entrepreneur. A successful woman usually loves
what she does. She is extremely fervent about her tasks
and activities. Her high energy levels motivate her to
contribute immensely towards building, establishing and
maintaining a prosperous business.
Women is open and willing to learn
A successful woman entrepreneur keeps side by side of
changes, as she is fully conscious of the importance of
evolving changes. She is ahead of her competitors and
thrives on changes. She adapts her business to changes
in technology or service prospect of her patrons. She is
inquisitive, concerned to learn and accommodative to
innovations.
Women are cost conscious
A successful woman entrepreneur prepares pragmatic
budget estimates. She provides cost- effective quality
services to her clients. With minimized cost of operations,
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she is able to force her team to capitalize on profits and
gather its benefits.
Women values cooperation and allegiance
A woman has the ability to work with all levels of
populace. She is keen on maintaining associations and
communicates evidently and efficiently. This helps her
to negotiate even responsive issues without difficulty.
She is sympathetic to people around her and have good
networking skills that help her to get better contacts
and utilize opportunities.
Women can balance home and work
A successful woman entrepreneur is good at balancing
varied aspects of life. Her multi- tasking aptitude
combined with support from spouse and relatives enables
her to bring together business priorities with domestic
responsibilities competently and efficiently.
Women are aware of her legal responsibility to the
social order
A successful woman entrepreneur is eager to share her
achievement with the society. She is dedicated to assist
others and enjoys her liability.
Women focus on their Plans
Women Entrepreneur’s plan their work and work with
plan. Set long-term and short-term goals and take
consistent action in moving toward them.
Women are Resourceful
Women entrepreneurs take advantage effectively
coordinating the available factors and resources such
as mentoring, training and coaching and build a strong
base of education, training and experience which can
help lead to success.
Key Changes In Women Entrepreneurs In Last
Five Decades
Women Entrepreneurs of the Fifties : Compulsive
factors led to the creation of women entrepreneurs
Women Entrepreneurs of the Sixties : Women began
to aspire but also accepted the social cultural traditions
Women Entrepreneurs of the Seventies : The women
in this decade opened up new frontier. They had not only
aspiration but ambition
Women Entrepreneurs of the Eighties : Women were
educated in highly sophisticated, technological and
professional education. They became equally contributing
partners
Women Entrepreneurs of the Nineties : This was the
first time when the concept of best rather than male heir
was talked about
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Women Entrepreneurs of the 21st Century : The status
of women in India has been changing as a result to
mounting industrialization and urbanization and social
legislation. Over the years, more and more women are
going in for higher education, technical and professional
education and their proportion in the workforce has also
been increased.
Role of women as an Entrepreneur :
Considering the flow of women entrepreneurs in the
traditional industries, it is often criticized that the women
entrepreneurship is engaged only in handloom and
handicraft and in the non-traditional term, now their
aspect have broaden into new line like hotel line, Xeroxing,
Beauty Parlor business, incense stick making, candle
making etc.
In the last decade, there has been a remarkable shift it
emphasizes from the traditional industry to non-traditional
industry and services. Based on this concept, some
important opportunities are being identified, considering
the socio-economic, cultural and educational status and
motivational level of women entrepreneurs, particularly
projects with low investment, low technical know-how
and assured market are suggested for them such as
production of soaps, detergents, readymade instant
food products including pickles, spices, papad,
manufacturing of woolen goods, beauty parlor business,
typing centre, job contracts for packaging of goods
and distribution and household provision etc. At present
they are:
Creative: It refers to the creative approach or innovative
ideas with competitive market. Well- planned approach
is needed to examine the existing situation and to
identify the entrepreneurial opportunities. It further implies
that women entrepreneur's have alliance with clued-up
people and constricting the right organization offering
support and service.
Quality to working hard : Innovative women have further
ability to work hard. The creative ideas have to come to
a fair play. Hard work is required to build up an enterprise.
Determination : Women entrepreneurs must have an
intention to fulfill their dreams. They have to make a
dream transferred into an idea enterprise.
Profit earning capacity : She has a capability to get
maximum return out of invested capital.
Functions of Women Entrepreneurs :
A Woman entrepreneur has also to perform all the
functions involved in establishing an enterprise
• Functions for establishment of an enterprise
• Idea generation and screening
• Determination of objectives
Special issue
•
Undertaking a risk and handling of economic
uncertainties involved in business.
• project preparation
• Product analysis
• Introduction of innovations, imitations of innovations.
• Form of business
• Co ordination, administration and control.
• Raising funds
• Supervision and leadership.
• Procuring men, machine and materials and operations
of business
In nutshell, women entrepreneur are those women who
think of a business enterprise, initiate it, organize and
combine the factors of production, operate the enterprise,
undertake risk and handle economic uncertainties
involved in running a business enterprise.
Credit facilities available for Women Entrepreneurs:
Small Business : For women entrepreneurs who intend
to provide service (not a professional service) such as
setting up a small lunch/canteen, mobile restaurant,
circulating library etc.
• Professional and Self Employed : Women
Entrepreneurs who are specially qualified/skilled and
experienced like Doctors, Chartered Accountants,
and Engineers or trained in Art or Craft etc.
• Retail Trade : For women entrepreneurs who intend
to engage in retail trading of various commodities.
• Village and Cottage/Tiny Industries : For women
entrepreneurs who are engaged in manufacturing,
processing, preservation and services such as
Handloom, Weaving Handicraft, Food-Processing,
Garment making etc. in village and small towns with
a population not exceeding 50,000 utilizing locally
available resources/skills.
• Small Scale Industries : To start a unit engaged in
manufacture, processing or preservation of goods.
• Agriculture & Allied Activities : For women
entrepreneurs who are engaged/intend to engage in
agricultural and allied activities, such as raising of
crops, floriculture, fisheries, bee- keeping, nursery,
sericulture etc. and also trading in agricultural inputs.
• Government Sponsored Programs : Apart from
the above schemes, women entrepreneurs are also
financed under the various Government Sponsored
Programs where Capital subsidies are available.
Women Entrepreneurs and Their Problems
Women entrepreneurs face many hurdles. Societal
support is a key determinant in entrepreneurial
establishment. The most common problem, which a
woman faces, is the non-cooperation from her husband
November 2015
Page 146
or close family members. Majority of the time the family
members do not motivate them. Besides they face other
problems like mobility constraints, dual responsibility,
low managing ability, risk-bearing ability etc. They don’t
lack managerial skills but they have less promotional
ability, which they need to improve upon.
Scarcity of raw material and finance are another problem
faced by the women entrepreneurs. The standard of
technology used by the women entrepreneurs is
qualitatively low; they are poor in technical know-how.
Transportation difficulties, improper power supply and
telecommunication are some of the other problem faced
by them. Marketing problem is the biggest problem faced
by women entrepreneurs.
There are some umpteen problems faced by women at
various stages beginning from their initial commencement
of enterprise, in running their enterprise. Their various
problems are as follows:
Arrangement of Finance
For every business undertaking Finance is said to be
the “life blood”, whether it is large, medium or small
enterprise. Women entrepreneurs face the problems of
shortage of finance on two important bases. Firstly,
women do not in general have property on their own
names to use that as collateral securities for obtaining
loans/funds from banks and other financial institutions.
Thus their access to external sources is very limited
.Secondly, obtaining the support of bankers, managing
the working capital, lack of credit resources are the
problems which still remain in the male’s domain.
Shortage of raw-materials
Women entrepreneurs encounter the problems of
shortage of raw-materials and necessary inputs. On the
pinnacle of this, is the high prices of raw materials, on
one hand and getting raw materials at minimum discount
rates are the other.
Cut-throat Competition
Lot of the women entrepreneurs have imperfect
organizational set up to drive in a lot of money for
canvassing and advertisements. They have to face severe
competition from organized industries. They have also
to face a stiff competition with the men entrepreneurs
who easily involve in the promotion and development area
and carry out easy marketing of their products with both
the organized sector and their male counterparts. Such
a competition ultimately results in the insolvency of
women entrepreneurs.
Lack of education and prevalent levels of illiteracy
amongst women
In India, around (40%) of women are still illiterate.
Illiteracy is the root cause of socio-economic barriers or
Special issue
hurdles. Due to lack of Knowledge of latest technological
change, know-how and education creates problems
before women to set up competitive enterprises.
Family Conflicts
Women also countenance the conflict of performing of
home role as they are not available to spend enough
time with their families. Because in India, mainly a
woman’s duty is to look after her children and manage
the other members of the family. In business they have
to spend long hours and as a result, they find it difficult
to meet the demands of their family members and
society as well. Their incapability to attend to domestic
work, time for education of children, personal hobbies,
and entertainment adds to their conflicts.
Marketing Problems
Women entrepreneurs incessantly face the problems in
marketing their products. It is one of the core problems
as this area is mainly dominated by males and even
women with adequate experience fail to make a dent.
For marketing the products women entrepreneurs have
to be at the mercy of middlemen who pocket the hunk of
profit. Although the middlemen exploit the women
entrepreneurs, the purging of middlemen is tricky,
because it involves a lot of running about. Women
entrepreneurs also find it difficult to capture the market
and make their products popular.
Lack of self-confidence and optimistic attitude
amongst women :Nowadays most of the women are suffering from
one major problem of lack of self-confidence, determination, physically powerful outlook, hopefulness etc. They
are always panic from committing mistakes while doing
their piece of work, more over there is limited initiative of
taking risk and bearing uncertainty in them. Thus all
these psychological factors often obstruct their path of
achieving success in the area of enterprise.
High cost of production :
High cost of production undermines the efficiency and
adversely affects the development of women
entrepreneurs. The installation of new machinery during
expansion of the productive capacity and like similar
factor dissuades the women entrepreneur from venturing
in to new area. Government assistance in the form of
grant and subsidies to some extent enables them to
tide over the difficult situations. However, in the long run,
it would be necessary to increase efficiency and expand
productive capacity and thereby reduce cost to make
their ultimate survival possible, other than these, women
entrepreneurs also face the problems of labour, human
resources, infrastructure, legal formalities, overload of
work, lack of family support, mistrust etc.
November 2015
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Future Prospects for Development of Women
Entrepreneurs
Education is a boon to mankind, while lack of education
to a person is a bane now-a-days. Throughout the world,
we can observe that the ratio of women entrepreneurs
is growing tremendously. The emergence as well as
development of women entrepreneurs is quite visible in
India and their over-all contribution to Indian economy is
also very significant. Today the role of Women
entrepreneur in economic development is inevitable
because women are entering not only in selected
professions but also in professions like trade, industry
and engineering.
The industrial structure and the enterprises are
undergoing a radical change. Information Technology has
transformed the very technique of doing business.
Individually, business ownership provides women with
the independence they crave and with economic and
social success they need. Nationally, business ownership
has great importance for future economic prosperity.
Globally, women are enhancing, directing, and changing
the face of how business is done today. Ultimately,
female business owners must be recognized for who
they are, what they do, and how significantly they impact
the world’s global economy.
Women should be considered as specific target group
for all development programs. Govt. should extend better
educational facilities and schemes to women folk.
Adequate training programs on management skills
should be provided to women community. Encourage
women’s participation in decision making. Vocational
training should be extended to women community to
enable them to understand the production process and
management.
Training on professional competence and leadership
skills should be extended to women entrepreneurs.
Activities in which women are trained should focus on
their marketability and profitability. State Finance
Corporations and financing institutions should permit by
statute to extend purely trade related finance to women
entrepreneurs. And lastly women’s development
corporation has to gain access to open-ended financing.
On the basis of the aforesaid problems faced by women
entrepreneurs and various other problems too, there is
a provision of a number of Strategies for promoting women
entrepreneurship to overcome these problems. Such
solutions or remedies can be well understood as under:• Promoting entrepreneurship among women is
especially important to tackle the problems of under
employment and unemployment in the society.
• Education has been instrumental in increasing the
participation of women in entrepreneurial activities.
Special issue
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•
•
•
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The formal education not only helps in acquisition of
requires knowledge for a job, which demands nontraditional skills but also imparts knowledge about
the different occupational opportunities.
There should be an incessant attempt to motivate,
give confidence, inspire and assist women
entrepreneurs.
Government should provide better educational
facilities and schemes to women folk.
There should be continuous monitoring, improvement
of training programmers, practical experience and
personality development programs to improvise their
over-all personality standards.
Establishment of proper training institutes for
enhancing their level of work-knowledge, skills, risktaking abilities, enhancing their capabilities. Training
Centers should provide training to prospective women
entrepreneurs free of cost and Entrepreneurship
Development Program should be much more practical
oriented.
A women entrepreneur should herself set up an
example by being successful and should act as a
role model. Since children have a tendency to emulate
their parents, the resultant effect would be automatic.
Establishment of proper training institutes for
enhancing their level of work-knowledge, skills, risktaking abilities, enhancing their capabilities.
Finance is sine-qua-non for any enterprise. The
banking system is not sufficiently responsive to social
banking needs and has not been able to deal with
barriers that hinder women from using or gaining
access to credit.
Creating provision of micro credit system and
enterprise credit system to the women entrepreneurs
at local level.
Provision should be made to provide land / sheds to
deserving women entrepreneurs on priority basis.
Group Women Entrepreneurship (GWE) may be
promoted in rural sector by reinvigorating activities /
skills on traditional crafts or practices with which they
are acquainted.
A Women Entrepreneur's Guidance Cell should be
set up to handle the various problems of women
entrepreneurs all over the state.
Positive attitudinal change in the society recognizing
the role of women as entrepreneur may lead to the
development of appropriate environment in which
women will be able to exploit their entrepreneurial
talents
Offering seed capital, up-liftmen schemes, women
entrepreneurs fund etc. to encourage them
economically.
November 2015
Page 148
•
To extend confessional rates facilities and schemes
for women entrepreneurs to prosper in the field of
enterprise.
Thus by adopting the following aforesaid measures in
letter and spirit the problems associated with women
can be solved.
Conclusion
India is a male dominated society and women are
assumed to be economically as well as socially
dependent on male members. The absolute dependence
seems to be diluted among the high and middle class
women as they are becoming more aware of personal
needs and demanding greater equality.
Women entrepreneurs faced lots of problems at startup as well as operating stage like, non availability of
finance, restricted mobility freedom and having to perform
dual role one at home and other at work. Technological
advancement and information technology explosion have
reduced the problem of women entrepreneurs. Along with
technological revolution, mental revolution of society is
needed to change the attitude of the society and
provide women with democratic and entrepreneurial
platform More-over with increasing Government and NonGovernment and other financial institutions assistance
for various women entrepreneurs within the economy
there can be significant increase brought about in the
growth of women entrepreneurship process. Still efforts
are being made to coordinate with the enterprise activities
of women and providing them utmost financial, morale,
psychological support by various institutions working
within the economy and world-wide.
Thus, Women have the potential and the determination
to set up, uphold and supervise their own enterprises in
a very systematic manner. Appropriate support and
encouragement from the Society in general and family
members in particular is required to help these women
scale new heights in their business ventures. The right
kind of assistance from family, society and Government
can make these Women Entrepreneurs a part of the
mainstream of national economy and they can contribute
to the economic progress of India.
Special issue
References
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• Development) * Dr. Sunil Deshpande **Ms. Sunita
Sethi.
• Theory and Practice- By Dr. D.D. Sharma & Dr. S.K.
Dhameja Abhishek Publications Chandigarh-17 (India)
• Women Entrepreneurship
and Economic
Development – By Sanjay Tiwari, Anshuja Tiwari.
Publisher: Sarup and Sons
• http://www.nytimes.com/2009/09/16/world/asia/
16ladies.html http://www.articlesbase.com/
entrepreneurship-articles/is-the-women-entrepreneurempowered-in- india-3147613.
November 2015
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PROSPECTS OF GREEN MARKETING AND ITS STRATEGIES
Hena. M1
Abstract
In today's business world environmental and social issues plays an important role in marketing. There is a growing
interest among consumers all over the world regarding protection of environment, which led to the emergence of
Green Marketing as a market for sustainable and socially responsible goods and services. As society becomes more
concerned with the natural environment, businesses have begun to modify their behavior in an attempt to address
society's concerns. Many governments around the world have also become so concerned about green marketing
activities that they have attempted to regulate them. Green Marketing practices is been adapted by various companies
in various industries, thereby minimizing wastage and integrating their activities in the environment. Indian companies
are also become serious about building sustainability in the environment. The present paper explores the necessity,
opportunities and challenges of Green marketing. It also focuses on the strategies that makes eco-friendly environment
through Green Marketing.
Key words: Green Marketing, Opportunities, Challenges, Marketing Strategies
Introduction
According to the American Marketing Association,
“Green Marketing is the marketing of products that are
presumed to be environmentally safe. Green marketing
is also be defined as "comprehensive management
process of recognizing, forecasting and fulfilling the
needs of customers and society in a profitable and
sustainable manner" (McDonough, P., Prothero, A, 1997).
In the words of Polonsky (1994) all activities designed
to generate and facilitate any exchanges intended to
satisfy human needs or wants, such that the satisfaction
of these needs and wants occurs, with minimal
detrimental impact on the natural environment?. Green
marketing refers to the process of selling products and/
or services based on their environmental benefits.
Such a product or service may be environmentally
friendly in itself or produced and/or packaged in an
environmentally friendly way. Thus, it incorporates a broad
range of activities including product modification,
changes to the production process, packaging changes,
as well as modifying advertising.
The research is exploratory in nature; it focuses on
Literature review, News Papers, Journals, websites and
the other reliable sources.
1. To examine the opportunities and challenges of green
marketing.
2. To bring out the green marketing strategies
1
.
Managerial Implications
This paper provides insights to marketers about various
challenges and opportunities in the Indian market while
going green and also consider the factors such as price
and awareness about green products among the
consumers while devising marketing strategies.
Evolution of Green Marketing
Green marketing term was first discussed in a seminar
on Ecological Marketing? organized by American
Marketing Association (AMA) in 1975 and took its place
in the literature. The term green marketing came into
prominence in the late 1980s and early 1990s. The first
wave of green marketing occurred in the 1980s. The
tangible milestone for the first wave of green marketing
came in the form of published books, both of which were
called Green Marketing. They were by Ken Pattie (1992)
in the United Kingdom and by Jacquelyn Ottman (1993)
in the United States of America. According to Peattie
(2001), the evolution of green marketing has three
phases.
First phase was termed as "Ecological" green marketing,
and during this period all marketing activities were
concerned to help environmental problems and provide
remedies for environmental problems. Second phase was
"Environmental" green marketing and the focus shifted
on clean technology that involved designing of innovative
new products, which take care of pollution and waste
issues. Third phase was "Sustainable" green marketing.
It came into prominence in the late 1990s and early
2000concerned with developing good quality products
which can meet consumers need by focusing on the
Faculty Member Department of Rural Marketing Management College of Cooperation, Banking and Management,
Kerala Agricultural University, Thrissur
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November 2015
Page 150
quality, performance, pricing and convenience in an
environment friendly way.
Characteristics of Green Products
We can define green products by following measures:
1. Products those are originally grown.
2. Products those are recyclable, reusable and
biodegradable.
3. Products with natural ingredients.
4. Products containing recycled contents and non toxic
chemical.
5. Products contents under approved chemicals.
6. Products that do not harm or pollute the environment.
7. Products that will not be tested on animals.
8. Products that have eco-friendly packaging i.e.
reusable, refillable containers etc.
The Four Ps of Green Marketing
Product : Entrepreneurs wanting to exploit emerging
green market either by identifying customer‘s
environmental needs or by developing environmentally
responsible products to have less impact than
competitors. The increasingly development of :
• Products that can be recycled or reused. Efficient
products, which save water, energy or gasoline, save
money and reduce environmental impact.
• Products with environmentally responsible packaging.
McDonalds, for example, changed their packaging
from polystyrene clamshells to paper.
• Products with green labels, as long as they offer
substantiation.
• Organic products — many consumers are prepared
to pay a premium for organic products, which offer
promise of quality. Organic butchers, for example,
promote the added qualities such as taste and
tenderness.
• A service that rents or loans products –such as toy
libraries.
• Certified products, which meet or exceed
environmentally responsible criteria.
Whatever the product or service, it is vital to ensure that
products meet or exceed the quality expectations of
customers and is thoroughly tested.
Price: Pricing is a critical element of the marketing mix.
Most customers are prepared to pay a premium if there
is a perception of additional product value. This value
may be improved performance, function, design, visual
appeal or taste. Environmental benefits are usually an
added bonus but will often be the deciding factor between
products of equal value and quality. Environmentally
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responsible products, however, are often less expensive
when product life cycle costs are taken into
consideration, for example fuel-efficient vehicles, waterefficient printing and non-hazardous products.
Place: The choice of where and when to make a product
available has a significant impact on the customers being
attracted. Very few customers go out of their way to buy
green products merely for the sake of it. Marketers
looking to successfully introduce new green products
should, in most cases, position them broadly in the
market place so they are not just appealing to a small
green niche market. The location must also be
consistent with the image which a company wants to
project. The location must differentiate a company from
its competitors. This can be achieved by in-store
promotions and visually appealing displays or using
recycled materials to emphasize the environmental and
other benefits.
Promotion Promoting products and services to target
markets includes paid advertising, public relations, sales
promotions, direct marketing and on-site promotions.
Smart green marketers will be able to reinforce
environmental credibility by using sustainable marketing
and communications tools and practices. For example,
many companies in the financial industry are providing
electronic statements by email, e-marketing is rapidly
replacing more traditional marketing methods, and
printed materials can be produced using recycled
materials and efficient processes, such as waterless
printing. Retailers, for example, are recognizing the value
of alliances with other companies, environmental groups
and research organizations when promoting their
environmental commitment. To reduce the use of plastic
bags and promote their green commitment, some
retailers sell shopping bags, under the banner of the Go
Green Environment Fund.
(Table -1)
The key to successful green marketing is credibility.
Never overstate environmental claims or establish
unrealistic expectations, and communicate simply and
through sources that people trust. Promote your green
credentials and achievements. Publicize stories of the
company environmental awards programs to profile
environmental credentials to customers and
stakeholders.
Opportunities in Green Marketing
1. Competitive Advantage: Adopting green practices by
organizations will help an organization to take
strategic advantage over its competitors in the
industry.
2. Increasing the consumer base:Variousstudies in
Indian context shows that consumers are aware about
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Table - 1 : Traditional Vs. Green Marketing
Sl
No.
4 Ps
Treatment under Traditional concept
01
P-PRODUCT
Raw material is Procured to transform it
into a product. The waste in the
manufacturing process is disposed off.
New concept in green marketing
•
•
•
•
02
P-PRICE
Expecting profit at all levels at the cost
of the environment
•
•
•
•
03
P-PROMOTION
Promotional strategies are rather more
important to hold the consumers than
educating them on green marketing
through promotional methods
04
P-PLACE
Concentration of production plants.
Eco friendly
Waste is minimized
Effective use of non-renewable
energy sources
Waste of one product should serve
as the raw material need of the
another
Price is spread throughout the
lifecycle of the product
Fixed on purchase power parity
Environmental safety
Health of employees and the
community is protected
Environmental responsibility and commitment
should be a part of the corporate culture and
they mission statement
•
•
•
Decentralization of manufacturing
plants to avoid unnecessary
transportation cost of raw materials
Skilled HR
Availability of green products nearer
to the residential places
Source: Compiled from secondary sources
green marketing and products.
3. Meeting Government Legislation as well as receiving
Subsidies from the Government: The GOI offers
subsidies to industries for implementing green and
clean technology.
4. Cost Reduction:Reduction of harmful wastes from the
manufacturing processes will cut down the cost of
the final product that will lead to cost reduction of
the organization.
5. Corporate Social Responsibility: Adopting green
practices /environment-friendly practices by the
organization will allow their concern for the
environment as well as for the society.
Green Marketing- Challenges
Although a large number of firms are practicing green
marketing, it is not an easy job as there are a number of
problems which need to be addressed while
implementing Green marketing. Many organizations want
to turn green, as an increasing number of consumers'
want to associate themselves with environmental-friendly
products. Alongside, one also witnesses confusion
among the consumers regarding the products. In
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particular, one often finds distrust regarding the credibility
of green products. Therefore, to ensure consumer
confidence, marketers of green products need to be
much more transparent, and refrain from breaching any
law or standards relating to products or business
practices. The numerous challenges in the field of green
marketing are as follows.
a. Need for Standardization : There is no
standardization currently in place to certify a product
as organic. Unless some regulatory bodies are
involved in providing the certifications there will not
be any verifiable means. A standard quality control
board needs to be in place for such labeling and
licensing.
b. New Concept : Indian literate and urban consumer
is getting more aware about the merits of Green
products. But it is still a new concept for the masses.
The consumer needs to be educated and made aware
of the environmental threats.
c. Patience and Perseverance : The investors and
corporate need to view the environment as a major
long-term investment opportunity, the marketers need
to look at the long-term benefits from this new green
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movement. It will require a lot of patience and no
immediate results.
d. Avoiding Green Myopia : The first rule of green
marketing is focusing on customer benefits i.e. the
primary reason why consumers buy certain products
in the first place. Do this right, and motivate
consumers to switch brands or even pay a premium
for the greener alternative. It is not going to help if a
product is developed which is absolutely green in
various aspects but does not pass the customer
satisfaction criteria. This will lead to green myopia.
Also if the green products are priced very high then
again it will lose its market acceptability.
Some other challenges ahead in Green Marketing Are:
Green products require renewable and recyclable
material, which is costly. It requires a technology, which
demands huge investment in R& D for example, water
treatment technology.
Though majority of the people are not aware of green
products and their uses and so majority of the consumers
are not willing to pay a premium for green products.
As demands, taste and preferences of the consumer
changes, many firms see these changes as an
opportunity to be exploited and have a competitive
advantage over firms marketing no environmentally
responsible alternatives. In India, around 25 per cent of
the consumers prefer environmental-friendly products and
appears that all types of consumers, both individual and
industrial are becoming more concerned and aware about
the natural environment. Nowadays, firms marketing
goods with environmental characteristics have realized
a competitive advantage over firms marketing nonenvironmentally responsible alternatives.
Green Marketing Initiatives in India
1. HCL eco Safe focuses on product lifecycle
management to ensure that our products right from
when they are manufactured, bought by customers,
recovered at their end-of-life and recycled after useful
life are done in an environmentally responsible
manner Key initiatives undertaken through HCL eco
Safe program.
2. Maruthi Company has been promoting green
practices since its inception. As a result the
company has not only been able to recycle 100% of
treated waste water but also reduced fresh water
consumption. The company has implemented rain
water harvesting to recharge the aquifers. Also,
recyclable packing for bought out components is
being actively promoted.
3. New Delhi, capital of India, was being polluted at a
very fast pace until Supreme Court of India forced a
change to alternative fuels. In 2002, a directive was
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issued to completely adopt CNG in all public
transport systems to curb pollution.
4. ITC strengthened their commitment to green
technologies by introducing =ozonetreated
elemental chlorine free bleaching technology for the
first time in India. The result is an entire new range
of top green products and solutions: the
environmentally friendly multi-purpose paper that is
less polluting than its traditional counterpart.
5. Suzlon Energy is the world‘s fourth largest windturbine maker is among the greenest and best Indian
companies in India. Tulsi Tanti, the visionary behind
Suzlon, convinced the world that wind is the energy
of the future and built his factory in Pondicherry to
run entirely on wind power. Suzlon‘s corporate
building is the most energy-efficient building ever built
in India.
6. IDEA Cellular is one of the best Indian companies,
IDEA, paints India green with its national use mobile,
Save Paper campaign. IDEA has also set up bus
shelters with potted plants and tendril climbers to
convey the green message.
7. Tuna manufacturers modified their fishing techniques
because of the increased concern over driftnet
fishing, and the resulting death of dolphins.
8. Xerox introduced a "high quality" recycled
photocopier paper in an attempt to satisfy the
demands of firms for less environmentally harmful
products.
9. The Hewlett-Packard [HP] Company announced
plans to deliver energy-efficient products and services
and institute energy-efficient operating practices in
its facilities worldwide.
10. The Surf Excel detergent which saves water
(advertised with the message-"do bucket
paanirozbachana").
11. Philips Lighting's first shot at marketing a standalone
compact fluorescent light (CFL) bulb was Earth Light,
at $15 each versus 75 cents for incandescent bulbs.
12. The energy-saving LG consumer‘s durables.
13. Coca-Cola pumped syrup directly from tank instead
of plastic which saved 68 million pound/year.
14. Badarpur Thermal Power station of NTPC in Delhi is
devising ways to utilize coalash that has been a
major source of air and water pollution.
15. Barauni refinery of IOC is taken steps for restricting
air and water pollutants.
We also have green buildings which are efficient in their
use of energy, water and construction materials, and
which reduce the impact on human health and the
environment through better design, construction,
operation, maintenance and waste disposal. The green
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building movement, spearheaded by the Confederation
of Indian industry (CII) - Godrej Green business center,
has gained tremendous impetus over the last few years.
From 20,000 sqft in 2003, India's green building footprint
is now over 25 million sq ft. This is not to imply that all
firms who have undertaken environmental marketing
activities actually improve their behaviour. In some cases
firms have misled consumers in an attempt to gain
market share. In other cases firms have jumped on the
green bandwagon without considering the accuracy of
their behaviour, their claims, or the effectiveness of their
products. This lack of consideration of the true
"greenness" of activities may result in firms making false
or misleading green marketing claims.
Green Marketing Strategies
Green marketing strategies as consumers become more
environmentally conscious, businesses must adapt a
green strategy. Small businesses seeking to leverage
the power of "going green" should carefully coordinate
genuine actions and marketing strategies.
1. Successful Market Segmentation and
Concentration on Selected Market Segment :
A company needs to focus on the market comprising
of the green consumers. The company can run
advertisement for its products in green focused
media. It can also innovate of a new green product
along with its existing products. Further, it can
altogether launch a new strategic business unit
aimed at green.
2. Developing a New Generation of Green Product
: Insufficient production processes and poor designing
of products can be very harmful for the environment
that is why the companies should consider possible
negative effects on the environment and minimize
them at the beginning of New Product Development.
3. Green Positioning : Companies interested in
positioning themselves as green should make sure
that all the activities that it is involved in supports its
projected image, so as not to cheat the consumers
as well the media.
4. Applying Green Promotion : Successful promotion
depends on choosing the right strategy and media
for promotion of green products. Any kind of green
promotion becomes neutral unless it supported by
corresponding corporate activities.
5. Green Packaging : A business that manufactures
and packages products can convert to eco-friendly
packaging. Converting to biodegradable packaging
provides customers with a visible symbol of the
company's commitment to "going green". The
business can also leverage the eco-friendly
packaging as part of its advertising program to help
draw in new environmentally conscious customers.
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6. Deciding about Green Prices : Consumers today
are willing to pay only a small premium or no premium
at all for the green products. Pricing may become a
cause of concern when it comes to selling the product
in the market, as its manufacturing may be
expensive due to new technology involved. It therefore
becomes the responsibility of the manufacturer to
decide upon the pricing of the product.
7. Applying "Green" Logistics : Distribution of goods
can also be designed such that they leave minimum
impact on the environment. Mere reduction in
packaging and wrapping can contribute to a large
extent in reducing the waste and saving paper.
Efficient inventory management can also contribute
in minimizing wastage in a big way.
8. Changing the Attitude towards Waste : Waste
generated always does not necessarily have to be
an unhelpful result of production processes. A newer
understanding of the idea of waste has given birth to
a new market of recycled products. Also it may be
so that which is deemed waste for a company may
be a raw material for another.
9. Electronic Press Kit : Press kits typically include
a company history, product brochures, and
biographies of the company executives, photos and
press clips. Companies often send a press kit to
every media outlet in the area. A business could
convert all of the documents and images into
electronic files and offer the kit as a downloadable
folder on its website. The electronic press kit requires
no paper and no postage. The website could even
indicate that the electronic press kit is part of an
ongoing effort to reduce the business' environmental
impact.
10. Electric/Hybrid Vehicles : Small-business owners
often serve as the most visible representative of the
business itself. If a small business owner tries to
rebrand the business as green, but drives a fuel
inefficient truck or SUV, the green marketing effort
seems deceptive. Switching over to an electric or
hybrid vehicle serves as another visible reminder that
the business pursues a green policy.
11. Creating Green Partnerships : It may be
sometimes possible that a company may not have
proper knowledge about green marketing, under such
circumstances the company can resort to making
strategic alliances with other companies, who
already have been using green marketing. These
kinds of green partnerships can aid in flow of
necessary knowledge and information for development
and effective implementation of green marketing.
12. E-Newsletters : Many businesses offer monthly
newsletters to their customers. A business can cut
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paper waste and printing costs, while providing equal
or greater levels of content, by shifting over to enewsletters. In this case, the newsletter itself serves
as marketing for the business and the delivery
method functions as an easy way to go green.
Some of the other successful strategies of Green
Marketing are as follows; Show potential customers that
the company follow green business practices and could
reap more green on bottom line.
For green marketing to be effective, company have
use following strategies too.
1. Being genuine : The companies are actually doing
what the business claim to be doing in the green
marketing campaign and the rest of business policies
are consistent with whatever the company is doing
that‘s environmentally friendly. Both these conditions
have to be met for the business to establish the
kind of environmental credentials that will allow a
green marketing campaign to succeed.
2. Educating your customers : It is not just a matter
of letting people know whateverthe companies are
doing to protect the environment; but also a matter
of letting them know why it matters. Giving your
customers an opportunity to participate,
personalizing the benefits of environmentally friendly
actions, normally through letting the customer take
part in positive environmental action.
3. Know your customer : To sell a greener product to
consumers, first the company need to make sure
that the consumer is aware of and concerned about
the issues that its product attempts to address.
4. Empower consumers : Make sure that consumers
feel, by themselves or in concert with all the other
users of the company‘s product, that they can make
a difference. This is called empowerment? and it‘s
the main reason why consumers buy greener
products.
5. Be transparent : Consumers must believe in the
legitimacy of the product and the specific claims
the companies are making. Hence complete
information need to be disclosed to make
environmentally friendly economy.
6. Reassure the buyer : Consumers need to believe
that the product performs the job it’s supposed to
do them won‘t forgot product quality in the name of
the environment. (Besides, products that don‘t work
will likely wind up in the trash bin, and that‘s not
very kind to the environment).
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Conclusion
Green marketing involves focusing on promoting the
consumption of green products. Therefore, it becomes
responsibility to adopt creativity and insight, and be
committed to the development of environment-friendly
products. Green marketing is still in its infancy and a lot
of research is to be done on green marketing to fully
explore its potential. Main problems are Lack of
consumer awareness, Limited scientific knowledge,
Financial constraints, Deceptive marketing, Lack of
stringent legal standards. There are sufficient
opportunities for green marketing but it may also face
lot of challenges as considerable percentage of
population are not aware and also willing to know the
affairs of green marketing initiatives. Hence proper
campaigns shall be used to educate them. Green
marketer must find an opportunity to enhance product's
performance and strengthen customer's loyalty.
References
1. Anna Khan and Mohammed Naved Khan, Analysis
of Barriers and Strategies for Promoting Green
Marketing,International Journal of Business and
Management Tomorrow , August 2012, Vol. 2 No. 8.
2. Davis and Joel J. "Ethics and Green Marketing."
Journal of Business Ethics 11 (2)- 1992: 81-87.
3. Jacquelyn A. Ottman, The New Rules of Green
Marketing: Strategies, Tools, and Inspiration for
Sustainable Branding-J. Ottman Consulting,
Inc.January 2011.
4. Mohanasundaram V, Green Marketing – Challenges
and Opportunities, ZENITH - International Journal of
Multidisciplinary Research - Vol.2 Issue 4, April 2012.
5. Pavan Mishra and Payal Sharma, Green Marketing
in India: Emerging Opportunities and Challenges
Mishra, Journal of Engineering, Science and
Management Education/Vol. 3, 2010/9-14.
6. Raghavendra andUsha, Green Marketing: It’s
Strategies for Sustainable Development , Indian
Journal of Marketing,June 2013, Volume No: 2 Issue: 4
November 2015
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MERGERS AND ACQUISITIONS OF INTERNATIONAL BANKING.
PENETRATION STRATEGY IN EMERGING ECONOMY OF MEXICO
Banco Santander México and Banca Serfin case
José G. Vargas-Hernández
1
Carlos Enrique Suárez Medina
Abstract
This paper explains the strategic penetration through mergers and acquisitions in international financial large corporate
in emerging countries like Mexico and the clash of European and Mexican management cultures. As a case study is
taken as a basis, the merger and consolidation of the Spanish BancoSantanderin Mexico, what was your strategy for
fusion of Mexican banks? How was way of governance in the country? Concluding and Banco Santander through
mergers and acquisitions have become the fourth strongest bank in Mexico and one of the strongest banks in the
world, as part of the explanation is considered their form of governance.
Key words: acquisitions, emerging economies, strategy, international mergers.
Introduction
Implementing strategies according to Luna (2010) are
designed from the highest administrative controls
addresses large corporate, which is the design of an
action plan covering all corporate levels. Taking this idea,
strategies designed by financial large corporate to grow
and develop, they are designed and planned from the
top levels of its leadership. At the stage of penetration of
new markets it is paramount and as part of the strategy,
to have people who are motivated, who know how the
business that are committed to the company, having
the ability to make modifications based on the situations
they encounter, they can create a corporate culture
(David, 2013).
When talking to diversify products and services, are
similar or not, it has to take into account that there are
diversifying of related and unrelated products. The way
to enter new markets, industries in other countries, is
full of challenges and decisions. Taking the best strategy,
the company can achieve success. Otherwise, a bad
decision making strategy can lead failure and the demise
of the company. Currently, the technology plays an
important role in the entry of companies into new
countries, especially technology of the information,
adding as an essential tool for the company.
Because it diminishes the problems of implementing a
model multi-business facilitates financial control and
results, monitors performance, improve decision making,
react better and faster to the contingencies of the
company, and does not distort the information, all of
these on proper use and capacity. When a company is
in one industry and, in one country, it can make the
decision to venture into new unknown markets. However,
must take into account the changes that have to do in
the organization, with a focus on multi-business, such
as to improve vertical organization and diversify its
products and services that will offer in the new market.
Complementing the model strategy, it should carry out,
implement it, evaluate it, and distribute it to all areas in
order to achieve a culture of change, development and
growth, such as Banco Santander does from its
headquarters in Spain. Banco Santander operates a
multidivisional structure; at the highest point of its
organization's president is Ana Botin since the
September 10, 2014, to take the position left with the
death of her father Emilio Botin. Along with her group
corporate staff in charge of managing, planning and
designing new strategies, in the background, is
composed of various heads of international areas, which
take care of the results of the different continents and
countries under their command (Vargas-Hernandez,
Guerra, Bojorquez Gutierrez Gutierrez Bojorquez, 2014).
Under the idea of the strategy, Pruthi, Wright and Lockett
(2003) mention that foreign companies that set up in an
emerging economy have a high probability of strategic
development and control in emerging countries, which
are more inclined to operational development. Such is
in the case of the Spanish group introduced to a financial
market like that of Mexico, which is considered as an
emerging economy, ordering its staff the training of the
new staff and devise new forms of management, to
incorporate the structure of the Bank.
Previously are defined as acquisitions the transfer control
of all assets, operations and management of the target
company, becoming the second company plant of the
bidding company. While the merger is defined as the
1
. University Center for Economic and Managerial Sciences, University of Guadalajara, Mexico.
Special issue
November 2015
Page 156
union of two companies to create a fully independent
one combining the assets, operations and management
of the two companies to enhance the advantages and
leverage best practices from both to benefit of a better
positioning the market. However, it is mentioned that if
there is no gain for the corporate enterprise, designated
as arrogance hypothesis indicates that increasing the
average value of the company pointing as the target (Roll,
1986).
The target company at the time to make known in public
offerings, mentioned that show increases in value but
over a few days the price falls to original levels, it is at
that point where it can fail after being targets of one or
more proposed merger or acquisition by other companies.
It mentions that at the time of the acquisition or merger
of the target companies, the prediction of the theory of
arrogance mentioned often brings a loss to both the
target company joined the bidding company, which tend
to hide the amount of buying and selling.
Malatesta (1983) mentions that in the part of the equity
of the shareholders of the bidding companies, tends to
increase significantly and combined the bidder company
and the target company, when disclose their results,
indicating increases that indicate obviously that the
changes in corporate controlling increase the market
value. The concept of arrogance is reflected in the bidding
company to buy the target company, on many
occasions, in higher amounts than actually the target
company is worth. This leads to mistakes that can be
harmful to the bidding company.
In mergers and acquisitions, as mentioned Peng (2010)
there are five groups which classify them: horizontal,
vertical, conglomerate, friendly and hostile. In this sense,
the way in which Banco Santander joins the Mexican
economy, showing his arrogance, showing its economic
power, by merging two national Mexican banks. in this
sense, the theory of transaction costs explains that the
merger increases costs due to contract creation to
reduce or cancel the opportunism, while the agency
theory, describes the corporate governance can reduce
uncertainty by a hierarchy and the combination of the
resources they possess as firms merged creates the
right synergy to early growth and development in the
country in which it entered, according to the resourcebased (Vargas-Hernandez, et al. 2014) approach.
Brief description of Mexican Financial System
The financial system in Mexico plays a central role in
the functioning and development of the economy. It is
composed mainly of various intermediaries and financial
markets, through which a wide range of instruments
mobilize savings users of this system to its most
productive and profitable uses (Banxico, 2015).Within
Special issue
this financial system there are financial services those
granted by the various organizations that make up the
financial system and facilitate the movement of money.
Among them are mainly financial intermediaries. Thus,
in this way they perform their duties to intermediate
resources and enable the existence of the payment
system in the economy, through the provision of various
financial services.
In this context, stands out the importance of the banking
sector, essential to achieve this goal, because it is
responsible for capturing the scattered savings in the
economy, Combining and channeling nimbly as financing
to individuals or companies with viable investment
projects part and add value to the economy (CNBV,
2015). In the case of the banking sector is sought the
financial margin, which is the result of the acquisition
costs of savers and investors, selling various products
and / or services and the performance of the placement
of resources through loans at rates higher than those
paid by interest income from these savings.
At this point, the banks become attractive to large
international corporate groups seeking to position
themselves in markets of other countries, by diversifying
their products and services. They provide an opportunity
for growth and development for these corporations. In
the case of financial group Santander, which by leveraging
economic factors of the fragile economy of an emerging
country like Mexico, the economic crisis that lived at
the end of 1993 and government intervention to rescue
the Mexican banking system, ending with the merger of
two national banks, taking control of organizational,
operational and administrative culture.
History of strategy, penetration and merger of Banco
Santander in Mexico
Banco Santander has a presence in Mexico since 1956,
when it first opened its doors as commercial office and
providing a range of advice in Mexico City. These financial
institutions were common at that time, since the law
prevailing at the time for foreign investments in 1969 did
not allow the participation of foreign credit institutions in
the Mexican financial market.
The small representative office, offered few services,
advising and giving guidance on any commercial or
banking operation with its home country, Spain. This
was done through intermediaries of some Mexican banks
that lent their services. In the late 80s, the Mexican
financial system experienced a series of transformations
and changes in the way of regulations. In 1989 the law
on foreign investment, opened the doors of the national
economy to foreign investment and allowed the
international investment banking, could settle in the
country.
November 2015
Page 157
Taking advantage of this first opportunity, it was settled
Santander Investment, which based its activities in the
capital markets and money. The next step, the
deregulation of the insurance sector, allowed the Banco
Santander entered Iberomexicana Insurance Company,
beginning a promising expansion, opening offices and
launching new products and services for the Mexican
population. In 1991, Banco Santander, under the name
Iberomexicana Insurance changed its name to Santander
Insurance and invited Metropolitan Life, one of the largest
life insurers in the United States, to join the new company
in Mexico and operate jointly on the market Mexican
life insurance.
The entry of Banco Santander in the banking market of
Mexico was a result of two major changes in the financial
regulation of the country. The first is privatization of banks
that had previously been nationalized by the Mexican
government in the first intervention to rescue domestic
financial institutions. Second, the signing of Free Trade
Agreement (NAFTA), which facilitated foreign commercial
banks to enter the Mexican market. To these two
opportunities, the Banco Santander responded with the
acquisitions of two Mexican national banks: Banco
Mexicano in 1997 and the Serfin Financial Group in 2000
(Martin Aceña, 2007).
Brief history of Banco Mexicano
The Banco Mexicano (Mexican Bank) was founded in
1932by former President Abelardo Rodriguez ,which was
acquired in 1955by the Mexican Society of Industrial
Credit. A few years later, in 1958, the Banco Mexicano
merged with the Banco Español (Spanish Bank), a credit
society which was born long ago under the name of
Banco Fiduciario (Trust Bank).In 1979, the Banco
Mexicano (Mexican Bank) became universal bank, taking
advantage of changes in banking legislation and change
exits name to Banco Mexicano Somex. Like many other
creditors and lenders, it was nationalized and sold after
the Group Financiero Inver Mexico (Inverméxico Financial
Group), which kept it empower until its sale to Banco
Santander in April1997, following the government’s
decision toped foreign investment and entry international
banking.
After a capital increase and its merger with a small
investment bank belonging to the conglomerate of
companies created by Santander Investment, the old
Banco Mexicano Somex, recovered its roots and adopted
the name of Banco Santander Mexicano. Commercial
characteristics of BancoMexicanoSomex were aimed
at the economically medium-high population of the
country and to support small and medium enterprises in
Mexico (Martin, 2007).
Special issue
Brief history of Banca Serfin
While the history of Banco Serfin, come from the Banco
de Londres, México y Sudamérica (Bank of London,
Mexico and South America), the first commercial bank
in the country. Founded in 1864 by a group of mostly
British partners, it was transformed in 1888 in the Banco
de Londres y México (Bank of London and Mexico), to
suit the country's legislation approved at the end of the
century. Later in the 90s, the general acceptance
company (financial acceptances) acquired the majority
of shares in the company. The bank was controlled by
the Garza family, the owners of a large variety of
companies in Monterrey. That company and the bank
moved in 1964 to join a larger conglomerate, known as
the Grupo Moneterrey (Monterrey Group).
The name of Serfin dates back to 1977. In 1982 passed
to the Federal Government, following the nationalization
that affected most of the Mexican banking system. The
company returned to private hands in the early 90s, when
it was bought by Adrian Sada Gonzalez, a member of
the same family who had owned the bank before
privatization intervention by the Mexican government.
However, complications and problems arising out of the
1995 financial crisis forced the Mexican government to
intervene to Banco Serfin for the second time and
implement a comprehensive program to rescue the entity
called FOBAPROA. The final transfer of ownership took
place in 2000, when Grupo Santander Central Hispano
acquired the bank Banco Serfín.
In addition, Banco Santander, two major groups attended
the award contest convened by the Institute de
Protección al Ahorro Bancario (Institute for Protection
of Bank Savings, IPAB and before FOBAPROA):
Banamex and HSBC. For its part, Banco Santander was
presented through its subsidiary, Banco Santander
Mexicano, who pitched a third proposal to merge the
Banco International (International Bank), showing its
structure and economic power, but there were two
circumstances under which these objectives have not
materialized. First, the antitrust laws governed at the
time by the Government of Mexico, forbade Banco
Santander Mexicano the purchase of the bank and
second, the differences in types of management of both
institutions, were not allowed to pursue it.
The excellent executives’ cadre of Banco Santander
Mexicano headed the operation, the knowledge that has
already possessed the Mexican financial market and
the strength and firmness of its bet. With the acquisition
of Serfin, also reinforced the same year the purchase of
an additional 15% of Santander Mexicano, thus raising
the stake to 99%, the Spanish Group was at the forefront
of the Mexican financial system, one of the faster growths
of the entire region. Banco Santander was the owner of
November 2015
Page 158
both entities, but decided to keep its independence for a time, to strengthen competitiveness: commanding Serfin
Adolfo Lagos and Santander Mexicano under the tutelage of Marcos Martinez.
Finally, in September 2002, both companies merged, creating Santander Serfin. Yet another splendid operation
was crowned this year. The sale of 24.9% stake in the company to Bank of America, oldest and closest ally since
Bank inter was constituted, and it was a strategic and financial success that further narrows the link with the then
second American credit institution, leaving a mark of undoubted strength in the market. Mexican franchise of Banco
Santander was definitively established on January 1, 2005 and the general direction was taken by Marcos Martinez,
one of the most recognized Latin American financial Banco Santander (Martin, 2015).
BancoSantandertoday
Banco Santander is one of the strongest financial groups in market value, according to the international ranking,
ranking No. 8Forbes(2015).
Table - 1 : TopWorldBanks
Ranking
Bank
Country
Sales
Profits
Assets
Market
value
1
ICBC
China
$166.8 B
$44.8 B
$3,322 B
$278.3 B
2
Bank of China
China
$120.3 B
$27.5 B
$2,458.3 B
$199.1 B
3
JPMorgan Chase
United States
$97.8 B
$21.2 B
$2,593.6 B
$225.5 B
4
Wells Fargo
United States
$90.4 B
$23.1 B
$1,701.4 B
$278.3 B
5
HSBC Holdings
United Kingdom
$81.1 B
$13.5 B
$2,634.1 B
$167.7 B
6
Citigroup
United States
$93.9 B
$7.2 B
$1,846 B
$156.7 B
7
Bank of America
United States
$97 B
$4.8 B
$2,114.1 B
$163.2 B
8
Banco Santander
Spain
$56.4 B
$7.7 B
$1,532.3 B
$109.4 B
9
Commonwealth Bank
Australia
$39.6 B
$8.1 B
$696.2 B
$117.1 B
10
Royal Bank of Canada
Canada
$38.9 B
$8.3 B
$857 B
$89.3 B
11
Westpac Banking Group
Australia
$35.6 B
$6.9 B
$674.5 B
$94.2 B
12
TD Bank Group
Canada
$32.7 B
$7 B
$851.9 B
$80.4 B
13
ANZ
Australia
$32.6 B
$6.7 B
$676.7 B
$77.6 B
14
National Australia Bank
Australia
$33.4 B
$4.9 B
$772.9 B
$71.7 B
15
ING Group
Netherlands
$65.7 B
$2.6 B
$1,195.7 B
$58.9 B
16
Lloyds Banking Group
United Kingdom
$65.6 B
$1.9 B
$1,333 B
$84.4 B
17
Société Générale
France
$54.2 B
$3.6 B
$1,583 B
$40.7 B
18
Bank of Nova Scotia
Canada
$27.9 B
$6.4 B
$671.9 B
$61.3 B
19
Deutsche Bank
Germany
$56.4 B
$2.2 B
$2,067.6 B
$49.7 B
20
Mizuho Financial
Japan
$27 B
$6.1 B
$1,634.7 B
$43.6 B
21
US Bancorp
United States
$20.3 B
$5.8 B
$406.2 B
$77.2 B
22
Standard Chartered
United Kingdom
$24.8 B
$2.6 B
$725.9 B
$39.8 B
23
Bank of Montreal
Canada
$20.1 B
$3.8 B
$530.3 B
$39.7 B
24
PNC Financial Services
United States
$16 B
$4.2 B
$345.1 B
$48.2 B
Special issue
November 2015
Page 159
25
Bank of New York Mellon
United States
$15.1 B
$2.5 B
$385.3 B
$45.1 B
26
Natixis
France
$23.7 B
$1.5 B
$714.4 B
$24.5 B
27
BB&T
United States
$9.7 B
$2.2 B
$188.4 B
$28.3 B
28
BNP Paribas
France
$124.5 B
$208 M
$2,514.2 B
$78.4 B
29
FirstRand
South Africa
$8.3 B
$1.9 B
$84.6 B
$26.9 B
30
Barclays
United Kingdom
$53 B
$-287 M
$2,117.3 B
$63.7 B
31
Royal Bank of Scotland
United Kingdom
$35.6 B
$-4.6 B
$1,638.4 B
$60.2 B
32
Regions Financial
United Kingdom
$5.4 B
$1.2 B
$120.4 B
$12.8 B
Source : Own elaboration with data of Forbes, best Banks of the World.
Banco Santander's presence international Lyman be found in countries
such as Brazil, Mexico, Chile, Argentina, United States, United Kingdom, Germany, Portugal, Holland, Austria,
Italy and Belgium. In Mexicoit has a network of branches distributed throughout Mexicototaling1310 points of
business centers, which have led to be positioned at number4 at national level, below Banorte, due to merger it had
with IXEBanco. But the market share it has been consolidated as one of their ference bank in the country, for its
range of products and services ,diversified across its network of business points.
Table - 2 : Ranking of Banks in Mexico
Rank
Bank or Bank Group
Total Assets
US$ billion
1
BBVA Bancomer
108.81
2
Banamex
91.84
3
Banorte
70.9
4
Santander México
61.83
5
HSBC México
38.99
6
Inbursa
26.1
7
Scotiabank Inverlat
15.83
8
Deutsche Bank México
13.37
9
Interacciones
9.85
10
Afirme
7.42
11
Banco del Bajio
7.12
12
Bank of America México
6.95
13
Ixe Banco
6.59
14
ING Bank México
6.25
15
Banco Azteca
6.02
16
BanRegio
5.12
Special issue
November 2015
Page 160
17
Monex
3.65
18
Mifel
3.53
19
Invex Controladora
3.35
20
Banco J.P. Morgan
3.07
Source : Based on data fromInfoBank, BankrankinginMexico.
On the other hand, the contribution that gives Mexico to the financial group Banco Santander's headquarters in
Spain is one of the strongest in Latin America level, contributing to the group of 7%global.This indicates that the
penetration of the Mexican market by Banco an tender is due to the market strategy that has been or so many
years, and to the merger of key banks for consolidation. However, considering that one of the most expensive
financial systems in the world, is the country's contribution with the sum of the costs f all products and services
provided by the bank in all their branch networks, which are diversified in products and services for each economic
sector that requires it.
Distribución del beneficio atribuido por negocio geográfico.
USA
Spain:
10%
15%
Rest of
Latinoamérica :
SCF:
5%
Chile:
10%
5%
México:
Poland:
7%
4%
Portugal:
2%
Rest of Europa:
1%
Brazil:
21%
United Kingdom:
20%
Graph - 1 : Distribution of attributable profit by geographic business
Source : Authors' calculations based on data from financial report 1T15 Banco Santander
It is mentioned that the growth of Banco Santander Mexico in annual data as attributes benefits to its customers,
with accounts at the bank's investment is an increase of 12.5% over the 1T14 and 1T15.
ATRIBUTED BENEFITS
ATRIBUTED
BENEFITS
Millions of constanteuros
millions of constant
euros
200
1T14
149
2T14
179
3T14
173
4T14
192
1T15
167
100
0
1T14 2T14 3T14 4T14 1T15
Graph - 2 : Profit attributable.
Source: Authors' calculations based on data from financial report 1T15 Banco Santander
Special issue
November 2015
Page 161
Conclusions
In this analysis it can be concluded that Banco
Santander is one of the largest financial groups worldwide,
which has proved highly trained and committed to the
performance of the institution at global level, based on
effort and strategies, implementation of these strategies
and use of time, to achieve consolidation in financial
markets that have ventured. The main strategy of Banco
Santander, in the introduction to its system in other
countries, is to merge with financial institutions that allow
it to achieve its market position, adding the efforts to
implement the way to work which it is to manage each
of its elements for the success of the group in a shortest
possible time. With this, add and achieve profitability in
the shortest time.
The incorporation in emerging economies is one of the
strategies that Banco Santander has worked. Most Latin
American countries are considered emerging economies.
Incidentally, in most of these countries it has a presence
Santander Financial Group. With all of them, the way it
was introduced to these, it is very similar to the way it
had entered into Mexico. Its strategy was gradual, taking
advantage of the opportunities of economic instability
affecting these countries, to be gaining positioning,
developing its own management and putting people who
have grown up in its institution in key positions, to create
brand loyalty.
The succession of power to the death of president and
majority shareholder of Group Santander, Emilio Botin,in
to the daughter Ana Botin, was without mishap, since
she knew the company and running it, since she was
also responsible at national level in one of the director
ships in Europe .The long-term vision to consolidate and
strengthen its structure ,has led Banco Santander to be
one of the most solid, effective and dynamic financial
groups worldwide. Its rapid growth, has led it to win the
recognition and trust of its customers, as a reliable and
solid bank in its structure.
References
•
Banco de México (Banxico), (2015), Sistema
Financiero
•
http://www.bancodemexico.gob.mx/sistemafinanciero/index.html, fecha de consulta, 12/05/2015.
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Banco Santander, (2015), Historia
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CFWCSancomQP01/es_ES/Corporativo/Acerca-delGrupo/Mas-de-un-siglo-de-historia/18561930.html?wpid=1278697994821, Fecha de consulta,
14/05/2015.
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Banco Santander, (2015), InformeFinanciero 1T 2015
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Pruthi, S., Wright, M. and Lockett, A. (2003). Do
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November 2015
Page 162
A STUDY ON CUSTOMER SATISFACTION OF AKSHAYA CENTRES
Krishna.R1
Ann Alu Mathew2
Abstract
Customer satisfaction is a business term, is a measure of how products and services supplied by a company meet or
surpass customer expectation. It is seen as a key performance indicator within business and part of the four prospective
of balanced sore card. the study focused on the customer satisfaction of the Akhaya Centres. Primary data were
collected for the study by using a pre sutured questionnaire among the 50 sample respondents. The study was
analyzed with the help of percentage, two way tables and graphs. The study shows that the customers are satisfied
with the services rendered by the Akshaya Kendra. However they want more services under the purview of these
centers.
Key words: Customer satisfaction, service providers, Infrastructure, government services
Introduction
Akshaya, an innovative project implemented in state of
Kerala aimed at bringing the digital divide, addresses
the issues of ICT access, basic skills. Sets and
availability of relevant content. Quality ICT dissemination
and service delivering facilitates (Akshaya Centers) are
set up within a maximum of two kilometer for any
household and networked leveraging enterpreur ship. It
was implemented jointly by the Kerala IT Mission and
Dept of Science and Technology. Akshaya was
inaugurated on 18th November 2002 by Dr.A.P.J Abdul
Kalam, the honorable president of India. Akshaya has
taken giant strides in the field of ICT Knowledge
dissemination and citizen service delivery. Akshaya has
proved its mark as the most efficient and financially viable
Common Service Centre model in India.
Akshaya project is an enormous step towards making
Government accessible to citizens, in ways that can
not only save huge costs to government but also make
it more transparent and efficient in its day to day
interactions with common man. Akshaya e-literacy
centre have transformed them into effective common
service centre (CSCs) that help the public to avail a
multitude of G2C, G2B as well B2B services under one
roof. At present close to 2300 Akshaya e-centers spread
across Kerala have been setup with every Panchayat
having at least two centers.
Purpose of the Study
According to Philip Kotler Satisfaction is a person’s
feeling of pleasure or disappointment resulting from
comparing a products perceived performance in relation
to his or her expectations. Customer satisfaction is the
level of persons felt state resulting from comparing a
products perceived performance in relation to the persons
expectation. This satisfaction level is a function of the
difference between perceived performance and
expectations.. A key premise in customer satisfaction
is understanding the needs and meeting or exceeding
the expectations of customers.. Customer Satisfaction
is a marketing tool and a definite value added benefit. It
is often perceived by customers as important as the
primary product or service your organization offers.
Akshaya e-literacy centre Canvas of services include
e-literacy, e-District, CHIAK RSBY and AABY
registrations, online ration card applications , Aadhaar
enrolment, utility bill payment through e-Pay and FREES,
e-ticketing, GKSF registrations, Malayalam computing,
NRK welfare fund, insurance services, Intel learn, IGNOU
courses, E-krishi, medical transaction insight and
computer training . Akshaya has shown its mettle in
each one of these services.As the customers awareness
and their level of satisfaction is play a key role in the
success and smooth running of these centers the study
focused on the customer satisfaction of the Akhaya
Centers.
Objectives
To find the customer satisfaction relating to services
provided by Akshaya centers.
Data Collection and Methodology
This is an empirical and analytical study based on mainly
primary data in order to evaluate the customer
satisfaction on Akshaya Centres. Secondary data are
gathered together from various sources such as
magazines and internet etc. Pathanamthitta DistrictKaviyoor Panchayat, was selected as the area under
the study. A sample of 50 persons was selected for the
study from the selected Panchayat. Personal interview
was conducted among the sample respondents. By using
a pre structured questionnaire. Percentage analysis two
way tables, diagrams and graphs were used to analyse
and present the data.
1
. Final year M.com Students Madras Christian College, Chennai.
. Final year M.com Students Madras Christian College, Chennai.
2
Special issue
November 2015
Page 163
Analysis and Discussions
Table - 1 : Showing Distribution According To Gender
Particulars
Number of Respondents
Percentage
MALE
31
62
FEMALE
19
38
TOTAL
50
100
It is clear from the above table that 62% of the
respondents are male, whereas female respondents
constitute only 38%.
Table - 2 : Showing Occupation Wise Classification
Occupation
Percentage
Government
Employed
5
10
Private
Employed
20
40
Student
21
42
Farmer
0
0
Others
4
8
Total
50
100
Table - 4 : Showing the Distribution According To
The Service Rendered
Service
Percentage
E-district
18
36
E-grant
1
2
E-pay
5
10
E-krishi
6
12
E-aadhaar
7
14
Others
13
26
Total
50
100
Among 50 respondents 36% availed e-district, 2% for egrant, 10% for e-pay, 12% for e-krishi, 14% for e-aadhaar
and 26% for other services.
Table - 5 : Showing Whether the Doubts Are Clarified
Response
Percentage
Yes
47
94
No
3
6
Total
50
100
The study shows that 10% are government employed,
40 % are private employed, 42% are students and others
constitute 8%.
Table - 3 : Showing the Sources of Information of
Services of Akshaya
Particulars
Percentage
Media
7
14
Public
16
32
Direct
Contact
27
54
Total
50
100
Majority of the respondents know about the services of
Akshaya through direct contact that constitute 54%,
32% of respondents through public and 14%
Among 50 respondents 94% says that their doubts are
clarified while 6% says their doubts are not clarified.
Table - 6 : Showing Approach of The Entrepreneur
Particulars
Percentage
Highly
Satisfied
28
56
Satisfied
22
44
Dis Satisfied
0
0
Total
50
100
Above table depicts that 56% are highly satisfied with
the approach of entrepreneur while 44% are satisfied.
Table-7 : Showing the Working Hour Convenience
Particulars
Percentage
Yes
49
98
No
1
2
Total
50
100
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November 2015
Page 164
Table -10 : Showing the Satisfaction of Services
Provided
Above table depicts that 98% are convenient with the
working hours while 2% are not convenient.
Delays in meeting the needs
Among 50 respondents 88% responded that there is no
delay while 12 % responded that there is delays in
getting their needs done.
Figure - 1 : Showing The Distribution of
Respondents According To Delays In Needs
Particulars
Percentage
Highly
Satisfied
26
52
Satisfied
24
48
Dis Satisfied
0
0
Total
50
100
12%
Table depicts that 52% are highly satisfied with the
services provided while 48% are satisfied.
Table -11 : Showing the Preference of More
Government Services
yes
no
Particulars
88%
Service Charges
Table depicts that 90% says that charges are reasonable
while 10% says charges are not reasonable.
Table - 8 : Showing Preference of Services
Percentage
Yes
49
98
No
1
2
Total
50
100
Table depicts that 98% prefer to include more services
through akshaya while 2% does not prefer.
Table -12 : Showing the Location.
Particulars
Percentage
Services
From Akshaya
46
92
Direct Service
4
8
Total
50
100
Table depicts that 92% of the respondents prefer service
from akshaya while 8% prefer direct service from offices.
Table - 9 : Showing About the Updating On Services
Particulars
Suitability of
Location
41
82
No
9
18
Total
50
100
Table depicts that 82% of respondents are updated
about the services provided while 18% are not updated.
Percentage
Yes
49
98
No
1
2
Total
50
100
Table depicts that 98% of respondents say that akshaya
centre’s location is ideal while 2% say its location is
not ideal.
Percentage
Yes
Number of
Respondents
Table -13 : Showing Akshays Role in Getting
Government Services
Particulars
Percentage
Yes
48
96
No
2
4
Total
50
100
Table depicts that 96% agree that akshaya has played
a vital role in getting government services to public while
4% does not agree.
Special issue
November 2015
Page 165
Table -14 : Satsfaction towards infrastructural facilities
Particulars
Percentage
Highly
Satisfied
18
36
Satisfied
32
64
Dis Satisfied
0
0
Total
50
100
•
•
•
•
•
Above table depicts that 64% of respondents are satisfied
with infrastructural facilities provided while 36% are highly
satisfied.
Table -15 : Showing Whether Akshaya Centers
Has Helped In Bringing Down Corruption
Particulars
Percentage
Yes
45
90
No
5
10
Total
50
100
Table depicts that 90% of respondents agree that
akshaya has helped in bringing down corruption while
10% does not agree.
Findings
• The genders wise classification of data shows that
majority of the respondents are males.
• Majority of respondents are students i.e. 42%.
• Analysis of data shows that majority of respondents
come to know about the services through direct
contact.
• Out of 50 respondents, majorities have come for edistrict service.
• Analysis of the data shows that approach of
entrepreneur is highly satisfied i.e. 56%.
• Analysis of data reveals that the service charges are
reasonable.
• Analysis of data reveals that working hour is
convenient.
• Majority of the respondents i.e. 88% say that there
is no delay.
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•
•
•
Majority of the respondents i.e. 82% say that they
are updated with the services.
Analysis of the data reveals that respondents i.e.
52% are highly satisfied with the services provided.
Majority of respondents i.e. 98% prefer to include
more government services through Akshaya.
Majority of respondent’s i.e. 94% say that their doubts
are clarified properly.
Majority of respondents i.e. 98% say akshaya’s
location is ideal.
Analysis of data reveals that Akshaya has played a
vital role in getting government services to public.
Majority of respondents are satisfied with the
infrastructural facilities.
90% of respondents say that Akshaya has helped
in bringing down corruption
Suggestions
It is the active participation of people which makes any
program meaningful.
• Therefore feedbacks should be taken.
• Awareness programs should be organized to the
people.
• Needs of the community should be developed and
modified time to time accordingly.
• Infrastructural facilities should be improved.
• As people prefer service from Akshaya include more
services.
Conclusion
Akshaya centers play a vital role to make the people
avail the government services.. However working hour
convenience and cost are two factors that are to be
considered to reach people to the akshaya kendres Most
of respondents are satisfied with services provided by
them and they are also in demand for the more service
offers through the Akshaya centers.
References
•
1 Aaker, D. A. and Keller, K. (1990), Consumer
Evaluations of Brand Extensions. Journal of
Marketing. 54 (1): 27-33
•
Bent (1998)” SWOT- lessons for marketing strategy
development”; vol 10(2);
November 2015
Page 166
CORPORATE SOCIAL RESPONSIBILITY FOR RURAL INDIA
Mithun Nair
1
Dr.Hari Sundar.G2
Abstract
The Council for Sustainable Development state that “Corporate Social Responsibility is the continuing commitment
by business to behave ethically and contribute to economic development while improving the quality of life of the
workforce and their families as well as of the local community and society at large” (WBCSD, 1999). Thus, the CSR
has two fold meaning. On one hand, it exhibits the ethical behavior towards its internal and external stakeholders. On
the other hand, it denotes the responsibility of an organization towards the environment and society in which it
operates. CSR is regarded as tool through which companies give something back to the society. It involves providing
innovative solutions to societal and environmental challenges. But the challenge work of development professional
and business community is to identify CSR priorities and the areas of interventions which are meaningful in the
context of rural development sector. Therefore, there is a necessity to study and understand how corporate enterprises
are using CSR initiatives and what is the impact of CSR actions on socio-economic development of people in rural
areas. This conceptual paper is a humble attempt to introduce CSR practices of corporate enterprises in section one.
It describes the present study which includes objectives, methodology and limitations of the study. Section three
discusses current status of CSR and business interest. Later part talks about challenges in context of CSR and
section six conclude the study.
Key words: Corporate Social Responsibility (CSR), Rural Development, Stakeholder, Social responsibility,
Philanthropy, CSR audit, Economic development
Introduction
As we all know, a major part of the India’s poorest people
lives in villages and these villages are in a state of neglect
and underdevelopment with impoverished people. The
difficulties of hunger, ignorance, ill health, high mortality
and illiteracy are most acute in rural areas. This is not
only because of shortage of material resources but also
because of flaws in our planning process and investment
pattern. India has the capabilities to meet these
challenges in rural areas.
However, the efforts of Governments of India may not be
adequate to provide basic services to its citizens. It is
being increasingly recognized that progress and welfare
of a society is not only the responsibility of the
Government alone, but many more participants need to
be involved to attain the development goal. The corporate
sector has a pivotal role to play in ensuring private
investment flows to those rural areas that have been
excluded of the development process so far and also to
work for sustainable development of rural areas in
general.
Over the past few decade, as a significance of rise in
globalization and pressing ecological issues, the
perception of the role of corporate in the broader social
context within which it operates, has been altered.
Corporate considers themselves as part of society and
accordingly act in a social responsible way that goes
beyond economic performance (KPMG and
ASSOCHAM, 2008). As a result of this moving from purely
profit to profit with social responsibility, many corporate
are endorsing the term ‘Corporate Social Responsibility
(CSR)’. It is essentially a concept whereby companies
decide voluntarily to contribute to the Society to make it
better and environmentally cleaner (European
Commission, 2001). Generally, CSR is understood as
“the commitment of business to contribute to sustainable
economic development by working with employers, their
families, the local community and society to improve
their quality of life, in ways that are both good for business
and good for development. A widely quoted definition by
the World Business
• To study and understand the CSR initiatives being
taken by organizations for rural development.
• To examine the corporate approach to work and their
mode of action for implementation for CSR initiatives.
• To assess the impacts of CSR actions on
socioeconomic development of rural India.
Scope of the Study
Scope of the study is limited to study concept of
corporate social responsibility (CSR) in the country, how
organization taking it and working towards it. And what
could be road ahead in Indian Context and mostly
focusing on the corporate social responsibility (CSR)
and its impact on rural development in context of India.
1
. Research Scholar, Hindustan University
. Associate Professor, SNGCE Kolenchery
2
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November 2015
Page 167
The study was conducted using mainly secondary data
and information. Secondary data has been collected
through annual reports of Ministry of Human Resource
Development, Ministry of Education, Economic survey,
Articles and review of reputed authors published in
national and international journals etc.
Limitations of the study
The main limitation of this paper is that this study has
only focused on a small sample of Indian companies.
Secondly, information collected from print literature,
websites of these companies and no primary data were
collected directly from the stakeholders through
interviews or surveys.
Concept of Corporate Social Responsibility
Corporate Social Responsibility (CSR) is regarded very
important for policies, practices and programs that are
integrated into business operations, and decision-making
processes throughout the organization, wherever the
companies does business and it includes current and
past actions as well as future impacts. CSR involves
addressing the legal, ethical, commercial and other
expectations society has for business, and making
decisions that fairly balance the claims of all key
stakeholders. CSR aims at “achieving commercial
success in ways those ethical values and respect
people, communities, and the natural environment.”
Simply put it means “what you do, how you do it, and
when and what you say.” Several kinds of terms have
been used interchangeably with CSR. They include
business ethics, corporate citizenship, corporate
accountability, sustainability and corporate responsibility.
The issues that represent an organization’s CSR focus
vary by size (small, medium and large), sector (for
example, financial institutions, infrastructure providers,
textile manufacturers, agriculture producers, supermarket
retailers, etc.) and even by geographic region. In its
broadest categories, CSR typically includes issues
related to business ethics, community investment,
environment, governance, human rights, the marketplace
and the workplace.
Need for Corporate Social Responsibility (CSR) in
India
All the interests of stakeholders and the actions of
managers of any business organizations have to be
governed by the laws of economics, requiring an
adequate financial return on investments made, but in
reality the operations of an enterprise need to be driven
by a much larger set of objectives that are being defined
under the term CSR. The broad rationale for a new frame
of ethics for corporate decision making, which clearly
constructs and upholds an organization's social
Special issue
responsibility, arises from the fact that a business
enterprise derives several benefits from society, which
must, therefore, require the enterprise to provide returns
to society as well. Above points establishes the stake
of a business organization in the good health and
wellbeing of a society of which it is a part. More
importantly, in this modern age of information technology
and emphasis on transparency, consumer of any product
or service are not likely to feel satisfied in buying from
an organization that is seen to violate the expectations
of what is deemed to be ethically and socially desirable?
Corporate Social Responsibility (CSR) in India
World has made full circle to emphasis this concept of
CSR through an articulation of the principle of social
responsibility of business and industry. And this trend
is no different in India either. Mahatma Gandhi, the
charismatic leader who brought the cause of India's
freedom from British rule, was a person who in several
respects was ahead of his time. His view of the ownership
of capital was motivated by the belief that essentially
society was providing capitalists with an opportunity to
manage resources that should really be seen as a form
of trusteeship on behalf of society in general. In June
2008, a survey was carried out by the Times Foundation
with the aim of providing an understanding of the role of
corporations in CSR. The findings of study revealed that
over 90 percent of all major Indian companies surveyed
were involved in CSR practices. In fact, finding suggests
that private sector was more involved in CSR activities
than the public and government sector organizations.
The leading areas that corporations were involved in were
livelihood promotion, health, environment, education and
women's empowerment (S. Ghosh and P. K. Ghosh,
2011).
Current Status of CSR in India
CSR has been practiced in India from long time.
Corporate like the Tata Group, the Aditya Birla Group,
ONGC and Indian Oil Corporation, are few name whom
have been involved in serving the community ever since
their inception. Many organizations have been doing their
part for the society through donations and charity
activities. But today, CSR in India has gone beyond
merely charity and donations, and is has approached in
a more organized manner. It has become an inseparable
part of the corporate strategy. Companies have effective
and efficient CSR teams that devise specific policies,
strategies and goals for their CSR works and set aside
finance to support them. These programs, in many cases,
are based on a clearly defined social philosophy or are
closely aligned with the company’s ?business expertise.
Employees become the strength of these creativities
and undertake their time and contribute their skills, to
implement them. CSR Programs could range from overall
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development of a community to supporting specific
causes like healthcare, education, environment etc. Best
practices followed by Indian Companies related to CSR
are as follows:
•
Public sector companies such as such as ONGC,
Indian Oil Corporation and SAIL has been spending
0.75-1 % of their net profits on CSR activities. In 200708 Rs. 246.70 crores was spent by oil PSUs on CSR
activities. ONGC?s CSR projects focus on higher
education, grant of scholarship and aid to deserving
young pupils of less privileged sections of society,
facilities for constructing schools etc. SAIL has taken
successful actions in environment conservation,
health and medical care, education, women upliftment
providing drinking water.
•
BHEL & Indian Airlines have been acclaimed for
disaster management efforts. BHEL has also adopted
56 villages having nearly 80,000 inhabitants.
• A private firm such as Reliance Industries and
Mahindra & Mahindra has been involved in CSR
activities from long time. Reliance Industries initiated
a project named as “Project- Drishti” to bring
• back the eyesight of visually challenged Indians from
the economically weaker sections of the society. This
project has brightened up the lives of over 5000 people
so far. Mahindra & Mahindra launched a unique kind
of ESOPs- Employee Social Option in order to enable
Mahindra employees to involve themselves in socially
responsible activities of their choice.
• GlaxoSmithKline Pharmaceuticals? CSR programs
primarily focus on health and healthy living. They work
in tribal villages where they provide medical checkup and treatment, health camps and health
awareness programs. They also provide money,
medicines and equipment to non-profit organizations
that work towards improving health and education in
under-served communities.
• The Infosys Foundation has organized training camps
for destitute women and built orphanages where
education is earmarked as a priority area. The
Foundation donated US$ 6.8 million towards relief
and rehabilitation of flood-affected districts of
Karnataka. The project is a model of sustainable
community development. They have Constructed
2,541 homes for flood victims of Belgaum, Gulbarga,
Dharwad, Gadag, Bagalkot, Bijapur, and Karwar. They
have also initiated the construction of 10,000 toilets
in the backward districts of Karnataka, work is still
going on.
India Corporate takes CSR route to expand business
In India skilled manpower are short in supply and existing
agencies have little patience to impart on-the-job training
Special issue
to newbie’s, GCPL rolled out 'Project Vijay' with the intent
of absorbing a large number of the trained youth for its
own need. The rest are assured job in other firms with
an average salary in the Rs 5,000-7,000 range. Over
4,500 students have already been trained, around 3040% of who have been placed across FMCG sales, agrisales and sectors like security, hospitality and retail.
Although the program is being offered free of cost, GCPL
maintains a bench of about 90% who would be certified
at the end of the course. "After getting certified, there is
a dramatic change in the confidence levels of the
individuals. It also creates a lot of positive 'word of mouth'
about GCPL itself," said Rahul Gama, VP (HR), GCPL
(N.Singh, 2012) which is keen on setting up a futureready sales organization.
They being thought from basic communication skills to
customer interaction and personality development,
students are taught how to deal with customers while
making a sales call. The project has been rolled out in
three states in underdeveloped states such as Madhya
Pradesh, Chhattisgarh and Orissa and it will be taken
to 10-12 states by next few years.
GCPL is not the only company working on corporate
social responsibility (CSR) role with a clear business
objective in mind. Others firms are working in CSR for
business benefits include Mahindra & Mahindra (M&M),
Hindustan Unilever (HUL) , Marico and Procter & Gamble
(P&G). M&M's watershed project covering 32 villages in
Damoh district, Madhya Pradesh, was set up with the
primary goal of conserving water, soil and environment.
The dam covers about 10,000 hectares, 4,000
households and 20,000 people. M&M feels overall
household income is expected to almost double as a
result of the project (True Volunteer Foundation, 2010)
So question is there what's in it for M&M, which will
bear all the management and CSR-related costs of the
project? "It is expected that farmers of the locality will
purchase tractors for cultivation and that farmers will
adopt micro-irrigation for their fields. As the project
involves high levels of construction activity, it is expected
that local entrepreneurs will adopt construction
equipment and work on projects locally. Local
businessmen are expected to purchase commercial
vehicles to cater to the needs of the area," said Anirban
Ghosh, VP, strategic planning and new business
development, farm equipment sector, M&M (Forbes
India, 2012). And it is supposed to enhance the sales of
M&M tractors and other equipment’s while pursuing CSR
A large number of public and private corporate are looking
at CSR as a do-good practice that will eventually help
improve sales. In its eighth year now, P&G 'Shiksha' is
structured to directly link its core cause (providing
access to education to underprivileged children) with the
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business. With a simple purchase, Shiksha empowers
consumers to lead the social change. "Shiksha is
resourced with a dedicated team and measured just as
any other Proctal and Gamble (P&G) brand. The initiative
helps drive trial for all our brands. Our latest consumer
study tells us that 51% of the consumers who are aware
of Shiksha are influenced to purchase the P&G product
that would help them contribute to the cause," said a
P&G spokesperson. Similarly, Marico's CSR initiative
linked to Nihar Shanti Amla has proposed that every
time a woman buys a Nihar bottle, 2% of
The proceeds will be contributed to the cause of
children's education. The initiative will be fund 19 projects
across Uttar Pradesh, Madhya Pradesh, Rajasthan and
other regions, where each project will touch 25-30 villages
within these geographies. "The initiative is expected to
draw a lot of empathy among our target group, especially
the Hindi heartland where average literacy level is slightly
lower. The positive rub-off will not be restricted to the
brand alone. It will also help in our rural expansion
program," said S. Gupta, CEO and Marico.
For those firms which have started on the working on
CSR with business objectives a decade ago, the results
are visible. HUL's Project Shakti, which started as a
rural distribution initiative in a few villages of Andhra
Pradesh in 2000, today has 45,000 'Shakti Ammas'
across more than 15 states. It catalyses rural affluence
even as it benefits business. Shakti, it is understood,
contributes 15% to HUL's rural sales today is more than
Rs 1,500 crore.
CSR as Business Strategy
It is already accepted idea that of CSR makes business
sense. This was realized and confirmed way back from
statement made by JN Tata way back in 1895, when he
stated, "We do not claim to be more unselfish, more
generous or more philanthropic than others, but we think
we started on sound and straightforward business
principles considering the interests of the shareholders,
our own and the health and welfare of our employees...
the sure foundation of prosperity."
As firm who take CSR as business strategy has to place
equal importance on financial returns as on fulfilling its
social and environmental obligations, popularly known
as the triple bottom line? Corporate are aimed at
harmonizing the environmental factors by reducing the
adverse effect of its commercial activities and initiating
steps encouraging eco-friendly practices. In order to build
social capital in the community, a corporate group also
got its managerial officials involved in social programs,
and has encouraged employees to share their skills with
others and work with community-based organizations.
Special issue
Companies needs be mindful of its social and moral
responsibilities to consumers, employees, shareholders,
society and the local community.
Challenges of CSR
There are number of challenges to the implementation
of CSR. They are enumerated below:
• Lack of Awareness of CSR Activities: There is very
less interest among general public in participating or
contributing to CSR activities of firms. This is because
of the fact that there exists little or no information
about CSR of companies. The situation is further
aggravated by a lack of communication between the
organizations involved in CSR and the people at the
grassroots.
• Local Capacities: There is serious need of capacity
building of the non-governmental organizations of
particular locality as there is serious scarce of trained
and effective institutions that can efficiently contribute
to the CSR activities initiated by different firms.
• Transparency Issues: Lack of transparency is one of
the key issues for the corporate as there is lack of
transparency on the part of the small firms as they
do not make adequate efforts to disclose information
on their programs, audit issues, impact assessment
and utilization of funds. And it adversely impacts the
process of capacity and trust building among the firms
which is very important for the success of any CSR
initiative.
• Lack of organizational set up among NGOs: There
are very few organized non-governmental
organizations in interior and rural areas that can
assess and work toward the needs of the community
and work with firms to ensure successful attainment
of CSR objective.
• Visibility Factor: The role of media in generating good
cases of effective CSR activities will spreads good
stories and sensitizes the population about various
on-going CSR initiatives of firms. This visibility and
branding exercise often leads many non-governmental
organizations to involve themselves in event-based
programs; in the process, they often miss out on
meaningful grassroots interventions and objective.
• Narrow Perception: NGOs and Government agencies
usually possess a narrow perception towards the
CSR initiatives of corporate, often defining CSR
initiatives more as donor-driven. As a result, short or
long run.
• Lack of clear CSR Guidelines: There are no statutory
guidelines or policy directives to give a direction to
CSR initiatives of firms. The CSR initiatives of
companies mainly depend upon their business size
November 2015
Page 170
•
and profile. It means that bigger the company, the
larger its CSR activities.
Lack of Consensus: There is a lack of consensus
amongst implementing agencies and stakeholders
regarding CSR activities. And it results in duplication
of activities by corporate houses in areas of their
activities and creates situation of ineffectiveness.
This results in a competitive situation among
implementing agencies rather than building
collaborative approaches. It limits company’s abilities
to undertake assessment of their activities in regular
interval.
There is a need of such Corporate Social Responsibility
campaigns from prominent and respectable firms which
has ability to change fate and face of rural India in the
significant areas of education, health, sports, cultural,
political, employment and neglected as well as
untouched areas of empowerment which will boost them
to live independent and dignified life which they deserve
as they are vital and inseparable part of society.
CSR as a Future Business Strategy
While today people talk about corporate doing social
work, the Tata Group feels it is the need of the hour. But
in western countries companies are not sure about
spending the shareholders money and corporate are
considering discontinuing CSR. According to Irani,
"Which is fine for them, but not for a country like India.
The governments of the western world have a strong
social security net so corporate can concentrate on
making profits and paying taxes regularly but in this
regard India still lags behind. As country we are far away
from being at the phase of socio-economic development
where government is solely responsible for the basic
needs of the public. We don't have a social security,
adequate health and education services. So till that
happen corporate houses need to come forward and
should fill the gaps."
Further he says that for an organization to be successful
it require public support which is very important. In any
society there is one section that makes profits and richer
than the rest which leads to disparity and poverty. Over
a period of time one can see that companies die out if
they do not support the general public.
In July 2004, B. Muthuraman, Managing Director, Tata
Steel Limited (TISCO) announced that in future TISCO
would not deal with companies, which do not confirm to
the company's Corporate Social Responsibility (CSR)
standards. Speaking at the annual general meeting of
the Madras Chamber of Commerce and Industry,
Muthuraman stated, "We will not either buy from or sell
to companies that do not measure up to Tata Steel's
social responsibility standards."
Special issue
Findings and Discussion
The CSR Policies and initiatives
The study shows that all surveyed companies present
themselves socially responsible companies, having CSR
policies and conducting practices. A large number of
firms talks about CSR philosophy, ecological and ethical
objectives in their mission statements, organizational
policy and plans. Even though all the surveyed firms
have CSR policies and objectives but no connection was
observed between firm’s agenda and the developmental
Goals. There are many companies taking CSR activities
for development of rural India. Most of them working on
education and it take the top priority list of the companies,
followed by health and livelihood. It has been found that
there are few companies take CSR initiatives in the area
of infrastructure and in environment which includes
plantation, awareness generation on environmental
issues etc.
Approaches towards the Work and Modes of Action
As CSR approach adopted by the companies is
concerned because it is not doing what it supposed to,
instead of that most of the companies have taken CSR
as their overall business strategy. Therefore, they have
been successful in achieving the objectives of both
business and social development. Their approach to work
is not mainly relief, welfare and service delivery but it is
sustainable development oriented, which have long term
benefits gain. Tata Steel Vedanta, Aluminum Ltd., Dr.
Reddy’s Labs, Ambuja Cement Ltd., Lupin corporate find
it difficult to make up there mind whether they should
participate in CSR activities for India, Bharat Petroleum,
SAIL believes in promoting human and social
development through poverty alleviation by building
capacity in rural India. Instead of providing for ignorable
assistance that does not lead to effective alleviation of
poverty or adequate development is designed as holistic
action that includes an agricultural scheme, land
cultivation and plantation programs, fodder preservation
schemes, water recycling programs, establishment of
medical and educational centers, adult literacy programs
and credit schemes. Aditya Birla Group, Asian Paints
activities are working towards trusteeship concept of
management. CSR interventions by IT companies such
as Infosys, HCL and WIPRO are philanthropic in nature,
working through financial assistance, assets and
facilities. The study shows that most of companies
implement CSR programs with respect to rural
development through four types of institutions which are
given as below:
• CSR activities implemented directly by the company
through its own (i) CSR division,(ii) Human Resource
Department (iii) Local management of manufacturing
unit;
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Page 171
•
•
•
CSR activities implemented through a foundation;
CSR activities implemented through partnership with
NGOs ,academic institutions, international agencies;
CSR activities implemented through partnership with
Government.
The Impact of CSR Programs on Rural People
The impact of CSR programs reflected by a sample of
some of prominent companies in India was classified
under five areas: livelihood, health, education,
environment and infrastructure.
Livelihood
The Dr. Reddy’s Foundation is implementing GrameenLABS Programme in partnership with the Rural
Development Department; Government of India (GoI). It
aims to provide 35,000 livelihoods to rural people in the
age of 18-25 years in 7 backward States of India.
Livelihood programs supported by Bharat Petroleum
show that the SHG group members are earning a steady
income of Rs. 2000 per month.
Health
The study also shows that many firms conduct number
of health camps to create health awareness especially
health issues like: immunization, blood donation, water
purification tablets etc. Up to 2008, SAIL has conducted
267 health camps which have benefited more than 4.5
lakhs people in rural area. Vedanta Aluminum Ltd covered
53 villages with 32,000 villagers by providing free
medicines, treatment, referral services etc. through its
mobile health units in Lanjigarh (Orissa). Tata Steel
Family Initiatives Foundation
(TSFIF) established ‘Lifeline Express’ hospital on wheels
which has helped over 50,000 patients in backward
states such as Orissa, Jharkhand and Chhattisgarh.
Education
Aditya Birla Group provided formal education to 62,000
children living in nearby area to the plants by running 26
formal schools. PSU such as SAIL assist around 138
schools in the peripheral areas of SAIL’s plants/ units in
the country where more than 80,000 children got
education (Kumar, 2008). HCL works with NGO's
Udayan, cry for social up-liftment of underprivileged
children. Similarly, WIPRO’s Azim Premji Foundation
also involved in providing education to poor and needy
children. HCL set up of the “Shiv Nadar Foundation”, an
educational foundation catering to poor student for
primary, secondary and higher education has helped rural
children gain access to formal schooling and higher
education.
Special issue
Environment
For sustainable development and management of natural
resources which are scarce in nature require efficient
and effective steps achieve it. Many Indian corporate
have been working for tree plantation, waste
management, watershed management, wind firm etc.
For example, PSU such as SAIL has planted 13.5 million
trees in and around SAIL plants / mines so far.
Watershed development program of Ambuja Cement Ltd.
covered 9,000 ha in the last four years. Sustainable water
management remains the top priority of Coca Cola
India Inc. So far, the company’s water initiatives have
improved the lives of more than 1, 40,000 people and
spread awareness about the crucial importance of water
conservation among millions people.
Infrastructure
Among the companies surveyed only few companies
are providing infrastructural facilities such as construction
or development of roads, electricity, school, health
centre, water facility, sanitation, community centre, etc.
Lupin Human Welfare and Research Foundation’s
scheme covered 38,000 villages in Rajasthan and almost
all villages have school buildings, ponds, link roads,
drinking water, community centers, and electricity. SAIL
has been involved in the construction and repair of 33
km of pucca roads per year, thereby providing nearby
two lakh people across 435 villages access to modern
infrastructure facilities every year.
Conclusion
Even though corporate are making serious efforts for the
rural development, but some critics still are questioning
the concept of CSR and motive behind the companies
initiative. There are people who claim that CSR underlies
some ulterior motives such as profit making instead of
welfare while others consider it otherwise. The reality is
that CSR is not a strategy for brand building; however, it
creates goodwill and brand among its employees and
rural consumer. Indulging into activities that help society
in one way or the other only adds to the goodwill of a
company. Corporate Social Responsibility is the
obligation of everyone i.e. business corporations,
governments, individuals because of the reasons: money
is earned only from the society and therefore it should
be given back; thus wealth is meant for use by self and
the public; the basic motive behind all kind of trade is to
quench the hunger of the mankind; the objective of all
business is and must be to help people especially whom
are living in rural areas. CSR should not be taken as
burden - it must be there as core of every business ethics,
and its treatment of employees and customers. Thus,
CSR is becoming a fast-developing and increasingly
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competitive field to tap rural India as market and treating
CSR as business strategy. The case for demonstrating
corporate responsibility is getting stronger as
expectations among stakeholders such as formers,
customers and the public are growing. Being a good
corporate citizen is increasingly critical for commercial
success and the key lies in matching public
expectations and priorities, and involvement and
achievements widely and effectively in areas of rural
development which is need of hour.
•
References
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•
•
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•
Ghosh J. (2003), Strategy for Development, Frontline
Vol. 20, No, 18, India.
Goyal S.K. (1996), Political Economy of India’s
Economic Reforms, Working Paper of the Institute
for Studies in Industrial Development (ISID), New
Delhi, India.
Srinivasan T.N. and S.D. Tendulkar (2003).
Reintegrating India with the World Economy.
Sherlekar S.A. (1999), Ethics and Management,
Mumbai: Himalaya Publishing House.
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Pednekar. Mahesh C., ‘Corporate Social
Responsibility & Business Strategy - A Case Study
on the Tata Group under Mr Ratan Tata’.
Arora, B. and Puranik. (2004), “A Review of Corporate
Social Responsibility in India”,
Development, 47 (3), pp.93-100.
Belal,A.T. (2001), “A Study of Corporate Social
Disclosures in Bangladesh”, Management
Auditing Journal, 16 (5), pp.274-288.
Conway, C.(2003), “Tracking Health and Wellbeing in Goa’s Mining Belt”, Case Study 5,
Chappel, M. and Moon, J.(2005), “Corporate Social
Responsibility(CSR) in Asia: A Seven country study
of CSR”, Business and Society,44(4), pp415-441.
Dutta, K. and Durgamohan, M. (2009), “Corporate
Social Strategy: Relevance and pertinence in the
Indian Context” retrieved on 6th April, 2012 from
www.iitk.ac.in/infocell/announce/conversion/papers.
November 2015
Page 173
INFLUENCE OF HOLISTIC MARKETING ORIENTATION ON CUSTOMER
VALUE IN NEW GENERATION BANKS IN KERALA.
Mr. Jomon Jose M1
Abstract
In today’s economic uncertainty and turbulence, creating and maintaining loyal relationships with banking customers
are vital for business success. There have been paradigm shifts in the banking sector from transaction orientation to
a holistic marketing orientation. Holistic marketing represents a marketing strategy which is developed by thinking
about the business as a whole. Espousing a holistic marketing orientation means integrating the value exploitation,
value creation, and value delivery activities with the purpose of building long-term, mutually satisfactory relationships
with customers. The purpose of this article is to determine the influence of holistic marketing orientation on customer
value. The data were collected from the customers of selected new generation banks in Kerala through questionnaires.
Pilot survey and Cronbach’s Alpha were used to confirm the validity and reliability of the study respectively and their
variables of measures. Statistical tools such as multiple regression analysis, correlation analysis were used for data
analysis. Findings indicate that holistic marketing orientations have significant and positive associations with customer
value. Researcher concludes that holistic marketing strategies could guarantee to capture customer value and in
order to earn and retain bank’s business. Researcher recommends that all firms should adopt holistic marketing
orientation concepts, in order to capture customer value and sustain firms’ profitability locally and globally.
Key Words: - banking sector, customer value, holistic marketing, and loyal relationships.
Introduction
Globalized markets and borderless flow of information
have resulted in intense competitive pressures and
increased customer expectations.
Productivity, quality, customer satisfaction are the buzzwords in today's business scenario that demand
considerable efforts on the part of the company. Further,
to attain the basic business goals of survival and growth,
businesses are looking for ways to attract and retain
customers in the long run. Banks play a vital role in
spearheading the economic development of the nation
and are the main stimulus of the economic progress.
The highly regulated and directed banking system has
transformed itself into one characterized by openness,
competition and prudence. This development conforms
to the liberalization and globalization needs of the Indian
economy. As gradual up gradation of skills and
technology and restructuring and re-engineering
processes are attempted by both foreign and private
sector banks, public sector banks in India face new
challenges. The need to become highly customer
focused has forced the slow-moving public sector banks
to adopt a fast track approach. The unleashing of
products and services through the net has galvanized
players at all levels of the banking and financial
institutions market grid to look new at their existing
1
portfolio offering. Further, due to exposure to global trends
after information explosion led by internet, customers
demand better services from their banks. There is shift
from mass banking products to class banking with an
introduction of value added and customized products.
Banks, privately owned or in the public sector have all
jumped into retail band wagon. New generation private
banks in India have fast emerged as one of the major
drivers of the banking industry and have witnessed
enormous growth in the recent past.
Recent advances in information technology have provided
the tools for banking managers to create a new generation
of customer value tactics. Holistic marketing represents
a marketing strategy which is developed by thinking
about the banking business as a whole. When using a
holistic marketing strategy, every aspect of the banking
business must be carefully considered. The bank must
think how the consumer will interact with its product, its
website, its advertising materials, and everything else.
A holistic marketing orientation can also provide insight
into the process of capturing customer value. One
conception of holistic marketing views it as integrating
the value exploration, value creation, and value delivery
activities with the purposes of building long-term, mutually
satisfying relationships and co-property among key
stakeholders. The researcher has taken the topic
.Head of Department-Management, Teams Global Village Academy, Mannuthy, Thrissur, Kerala.
Special issue
November 2015
Page 174
“Influence of holistic marketing orientation on customer
value in new generation banks in Kerala”, to know how
holistic marketing concept helps the banks to realize
the improvements in customer satisfaction and retention,
reduce cost of sales and services, increase sales and
revenue and acquire new customers.
The influence of holistic marketing on customer value in
the context of new generation banking sector is a widely
discussed topic in the literature. This section targets
popular journals, magazines and various text books that
contain fruitful information on holistic marketing and its
dimensions as well as customer value.
Holistic Marketing
According to Govindarajan (2007), the concept of holistic
marketing entails the wider view of marketing strategies
that involve the development of marketing programs,
processes and activities that help in the marketing of
products. He points out that the concept of holistic
marketing plays an important role, especially in selecting
marketing formats that help in identification of
comfortable marketing strategies. He states that the
concept of holistic marketing is based on four major
components that enable effective designing and
implementing of marketing programs and processes.
These holistic marketing components include effective
relationship marketing, the integrated and internal
marketing, and, furthermore, the performance marketing
as they are essential for effective marketing strategies.
How Holistic Marketing Can Deliver and
Communicate Value
According to Penelitianku (2008, p.1), holistic marketing
is an essential tool of delivering and capturing consumer
value. He notes that holistic marketing components help
in exploring, creating and delivering consumer value.
Singh & Srivastava (2008, p. 3) also point out that
relationship marketing, a significant holistic marketing
component, plays an important role in delivering and
communicating customer value. They note that the
management of relationship marketing enhances effective
relationship networks at each stage of the supply chain;
therefore, building long-term relationship between
companies and customers. The creation of long term
relationship enables organizations to capture and utilize
customer’s demands thus delivering and communicating
consumer value.
Singh & Srivastava (2008, p. 3) also point out that
relationship marketing enables the creation service
delivery system, especially at each stage of the supply
chain. They note that these service delivery systems
enables active participation of customers that result in
creating their confident and loyalty towards the
organizations. For instance, developing effective
Special issue
customers’ communicating systems and sensitizing the
employees on the importance of such system in
maintaining good relationship with customers is
essential for communicating and delivering customers’
value effectively (Singh & Srivastava 2008, p. 4). They
note that the primary concern of any business
organization is to create a long term relationship with
its clients, to ensure that it complies with the market
demand by delivering and communicating consumer
value, which actually is the main objective of relationship
marketing.
The integrated marketing, a holistic marketing
component, is essential in delivering and communicating
value. According to Rehman & Ibrahim (2011, p.188),
integrated marketing communication (IMC) entails
various strategic programs that enable organisation to
create, communicate and deliver value to their clients.
They note that the integrated marketing communication
addresses four key elements of market activities,
generally known as market mix, which include product,
price, place, and promotion. For instance, an
organisation can use integrated marketing
communication to initiate a product promotion program
and practice that enhances good relationship with its
customers thus promoting service delivery and value.
According to Himansu (2009, p.1), the internal marketing
is also another component of holistic marketing that can
deliver and communicate consumer value. He notes that
internal marketing depicts practices that ensure full
participation of each employee in an organisation to
exploit the market orientation thereby integrate service
delivery. He points out that through internal marketing,
organisations are able to research on market complexity
that involves products’ marketing channels. In the
process, it identifies and devises appropriate marketing
strategies that can effectively deliver and communicate
consumer value. Training or hiring employees with
adverse marketing knowledge also enables organisation
to sensitise its internal marketing strategies that, in turn,
deliver and communicate effective consumer value
(Himansu 2009, p.1).
On the other hand, social marketing, which is another
component of holistic marketing, entails organisation’s
social responsibility that can deliver and communicate
value. According to Hoeffer & Keller (2006, p.79), social
marketing enables an organisation to understand the
ethical, environmental and social concept of market trend.
They point out that these concepts enable organisations
to venture into programs and practices that address both
the interest of the consumer and the entire society;
therefore, enhancing effective delivery and
communication of consumer value. For instance,
organisation through its marketers can promote social
activities such as business sponsorship that shows its
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social responsibility in promoting business ideas. In the
process, each member of the society establishes and
acknowledges the organisations’ brands thus enhancing
delivery and communication of consumer value.
Importance of the Study
Everything matters under the holistic marketing umbrella.
In a developing economy, product and service offerings
have multiplied exponentially along with competition.
Information is available instantly. The new marketing
paradigm has shifted the emphasis from product and
production, to selling, then integrated marketing within
the holistic marketing concept. The study helps to
describes and analyses the ways in which holistic
marketing can assist banks to connect with customers.
It also explains how holistic marketing can help in
building brands. Moreover, the study explains how holistic
marketing can deliver and communicate value.
The purpose of the study is to provide a deeper
understanding of how holistic marketing concept helps
the banks to create and maintain customer value. From
the problem discussion researcher has formulated the
following research questions.
1. How holistic marketing philosophy helps the banks
to identify and create more promising new value
offerings?
2. Which holistic marketing dimensions are essential
in forming value among Kerala customers in
association with new generation banking sector?
The overall objective is to evaluate the influence of holistic
marketing on customer value in the new generation
banking sector in Kerala.
1. To analyze the influence of relationship marketing,
internal marketing, integrated marketing and
performance marketing on customer value in the new
generation banking sector in Kerala.
2. To identify the interrelationships between holistic
marketing and customer value in the retail banking
sector and to identify the benefits of this relationships.
Hypothesis of the Study
H1:There exists a significant positive relationship
between holistic marketing and customer value
exploration in the banking context.
between holistic marketing and value creation in the
banking context.
between holistic marketing and value delivery
activities in the banking context.
Special issue
H4: Holistic marketing have high influence on customer
value in the banking context.
Research process adopted for this study included a set
of advanced decisions that made the master plan
specifying the methods and procedures for collecting
and analyzing the needed information. The Research
process for this study included stages such as
exploratory, descriptive and causal researches. The
present study used primary data collected through a
pretested questionnaire method. The questionnaire was
pretested by conducting pilot study and suitable
modification has been made in the questionnaire relating
to the study. Data pertaining to the study collected
between July 2015 to September 2015. The
questionnaire in this study was designed as closed –
end questions where the respondents have to make their
response in a 5 point Linker scale varying from “Strongly
disagree” to “Strongly agree”. To understand the
demographic profile of the respondents, questions
related to Age, Sex, Qualification and Income etc were
included. In this study all the customers who utilize the
retail banking service offered by the various types of new
generation banks in Thrissur, Kerala was considered as
population for the study. The samples are selected on a
random basis after visiting different branches of various
banks in the city without any prejudice on considering
or rejecting a particular respondent. The researcher has
chosen 150 respondents of new generation banking
sector as sample. Statistical tools such as multiple
regression analysis, correlation analysis were used for
data analysis.
Reliability Test
From Table 1 shown that Cronbach’s Alpha 0.774 hence
we can say the reliability of the questionnaire is at
moderately good level.
Table – 1: Reliability Statistics
Cronbach’s
Alpha
Cronbach's Alpha Based
on Standardized Items
N of Items
.774
.774
25
Analysis and Results
Correlation analysis
Correlation analysis is used when independent variables
are correlated with one another and with the dependent
variable. Since both variables are interval, Pearson
Correlation test was conducted. From the analyze, it
can be observed that the correlation coefficient between
holistic marketing and customer value exploration is
0.673, at a significant level of 0.01 (Pannerselvam,
2014).Hence we accept the Hypothesis 1.In other words
holistic marketing and customer value exploration are
November 2015
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related with a moderate positive relationship (r = 0 .673).
From the analyze, it can be observed that holistic
marketing and value creation are related with a high
positive relationship (r = 0 .740) and holistic marketing
and value delivery activities are related with a moderate
positive relationship (r = 0 .654). Hence we accept the
Hypothesis 2 and 3.
Multiple Regression Analysis
Table - 2 (a) : Model Summaryb
Model
Model
Durbin-Watson
1
1
1.539
a.
Predictors: (Constant), Performance Marketing,
Relationship Marketing,
Integrated Marketing, Internal Marketing,
In the column (table 2.a) labelled R2, which is a measure
of how much of the variability in the outcome is accounted
for the predictors. For the R2 model its value is .208
which means that customer value for 20.8% of the
variation in predictors. The Durbin-Watson Statistic
informs us about whether the assumption of independent
errors is tenable. The value (1.539) is below 2 indicates
a positive correlation.
The multiple regressions the model takes the form of a
equation that contains a coefficients (b) for each
predictor. The table2 (b) gives us estimates of these b
values and these values indicate the individual
contribution of each predictor to the model. The b values
tell us about the relationship between customer loyalty
and each predictor. If the value is positive we can tell
that there is a positive relationship between the predictors
and the outcome whereas a negative coefficient
represents a negative relationship. For these data all
predictors have positive b values indicating positive
relationships. The b values also tell us to what degree
each predictor affects the outcome if the effects of all
other predictors are held constant. Each of these beta
values has an associated standard error indicating to
what extent these values would vary across different
samples, an these standard errors are us to determine
whether errors are used to determine whether or not the
b values differs significantly from zero. The major
hypothesis stated in this paper was “the holistic
marketing may have high influence on customer loyalty.”
Regression analysis was used for examining whether
each holistic marketing dimensions is affected by
customer loyalty. Thus the finding is in line with the
hypothesis stated in the paper that the holistic marketing
may have high influence on customer loyalty. Thus the
major hypothesis stated is well accepted. (Table : 2b)
Special issue
Table - 2 (b) : Coefficientsa
Unstandardized
Coefficients
Model
Standardized
Coefficients
B
Std. Error
(Constant)
.824
.196
Relationship
Marketing
.199
.099
.208
Internal
Marketing
.301
.141
.318
Integrated
Marketing
.451
.121
.482
Performance
Marketing
.426
.105
.442
b.
Beta
Dependent Variable: Customer Value.
Findings & Discussion
This particular study was oriented on the influence of
holistic marketing on customer value. The research
proves that holistic marketing is an important strategy
for new generation banks success, in today’s
increasingly competitive environment. Banks need a welldefined strategy for value exploration. To exploit a value
opportunity, the bank needs value-creation skills. Banks
need to identify new customer benefits from the
customers view, utilize core competencies from its
business domain and select and manage business
partners from its collaborative networks. Banks must
understand what the customer thinks about and wants
to craft new customer benefits. Banks must also observe
who the customer admires, who they interact with and
who influences them. Consumer value is seen as the
key factor in winning market share and developing a
sustainable competitive advantage. Banking industry is
no exception as it has high interaction with the
customers, so managers must understand the factors
which influence the loyalty of the customers towards
their respective banks. The present research finding
supports the fact that relationship marketing is a
significant factor which influences the customer value of
banks. Banks must shape separate offers, services, and
messages to individual customers, based on information
about past transactions, demographics, psychographics,
and media and distribution preferences.
Recommendations & Scope For Future Research
The two phases of research for this article were carried
out among customers of banks in Thrissr district, Kerala,
the researcher believe that the same methodology can
be extended and a comprehensive analysis suited to all
customers in India can be initiated and such an effort
will be relatively easy considering the similarities in
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Page 177
products and services offered by various banks within
the country. Researcher recommends that all firms
should adopt holistic marketing orientation concepts, in
order to capture customer value and sustain firms’
profitability locally and globally.
Conclusions
In conclusion, the write up has highlighted holistic
marketing as being an essential marketing strategy that
effectively design and implement programs and practices
in coping with market complexity. It has highlighted the
need to utilize the four marketing components of the
holistic marketing to fully address the customers’ value
in new generation banking industry. This paper explores
the content and objectives of holistic marketing, explains
its influence on banking sector and describes the overall
implementation process and its supporting pillars.
Researcher highlighted how holistic marketing
framework, shows the interaction between relevant
actors (customers, company, and collaborators) and
value-based activities (value exploration, value creation,
and value delivery) helps to create, maintain, and renew
customer value. In order to be efficiently implemented,
holistic marketing has to be approached as a
management process that is strongly influenced by the
organizational culture and leadership climate.
References
Books
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Govindarajan, M. (2007). Marketing Management:
Concepts, Cases, Challenges and Trends. (2nd ed.)
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•
Jain, P.C., & Bhatt, M.(2008) Consumer Behavior :
In Indian Context. . (2nd Rev. ed.). New Delhi, India
:S.Chand
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Kothari,C. R.(2003).Research Methodology .(2nd
ed.) .Delhi, India :New Age International.
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Kotler , P., & Keller, K. L. (2012) Marketing
Management(14th ed.), New Jersey, N.J.:Pearson
Education , Prentice Hall.
•
Kotler, P., Armstrong, G., Agnihotri, P. Y., & Haque,
E. U.(2010) Marketing Management: A South Asian
Perspective (13th ed.), Delhi, India: Dorling
Kindersley.
•
Kotler, P., Keller, K. L., Koshy, A. & Jha, M.(2009)
Marketing Management: A South Asian Perspective
(13th ed.), Delhi, India: Dorling Kindersley.
•
Pannerselvam, R.(2014). Research Methodology. (2nd
ed.) .Delhi, India: Prentice Hall of India.
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Saxena, R. (2006) Marketing Management. (3rd.
ed.).New Delhi, India:Tata McGraw-Hill Publishing.
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Sontakki, C.N. (2009). Marketing Management. (2nd
Rev. ed.). New Delhi, India: Kalyani Publishers.
Special issue
Journals And Other Articles
•
Lassignardie,J., & Desmarès, P. (2013). Achieving
Differentiation in a Commoditized Market. World
Retail Banking Report 2013.
http://
www.capgemini.com/wrbr13 http://www.efma.com/
wrbr
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Lassignardie,J., & Desmarès, P. (2013).Evolving
Usage of Mobility In Banking. World Retail Banking
Report 2013. http://www.capgemini.com/wrbr13
http://www.efma.com/wrbr
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Rao,R.S.(2014). The Role of Retail Banking. In
Indian Economy International Journal of Engineering
Research and General Science Volume 2, Issue 2,
Feb-Mar 2014
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Rehman,S.U.,&Ibrahim,M.S.(2011,November 22).
Good Relationship with its Customers Thus
Promoting Service Delivery and Value. Journal of
Arts, Science & Commerce, International Refereed
Research Journal, Vol. II (Issue 4, Oct. 2011).
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Sethuraman, J. (2014). Retail Banking - Models,
Strategies, Performances and Future - The Indian
Scenario. Indian Institute of Banking and Finance,
Mumbai
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internal structure of tests. https://en.wikipedia.org/
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Integrated Marketing. Integrated Marketing:
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Special issue
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E-PUBLISHING -A STRATEGIC OVERVIEW
P.M.Manoharan Pillai1
Abstract
E-publishing is a computer aided or assisted process of publishing in which the documents are submitted in electronic
form, edited, printed and even distributed to readers by employing computer and telecommunication networks; and
the product of e-publishing may consist of abstracts, full texts, graphics, pictures and interactive features as well.
Some scientists describe it as application of information technology to traditional print publishing and according to
them the term electronic publishing refers more precisely to the storage and retrieval of digitized information through
electronic communication media. So e-publishing can be represented as the combination of information technology
and traditional publishing techniques i.e., e-publishing = information technology (=Computer technology
Communication technology) + publishing techniques.
Key words:- E-document, Traditional Publishing, Communication Technology, Print-on-demand, electronic ink.
Introduction
The advent of Computers ushered in a new era in many
discipline. Information technology has significant impact
on the publishing industry too, paving the way for internet
and digital library throughout the world. The printing
and publishing industry has came in to existence after
the invention of printing press which movable type by
Johannes Gutenberg in 1455. The technology enables
the manufacture of high quality printed works at a fraction
the cost of hand copying. With the passage of time
literary, scientific, historic, and informative works.
Observations and experiences of people are started to
be recorded in the paper media rapidly. The society which
could thousands of years without papers became paperbased rather paper-dependent society within a few years.
With the emergence of many such analogues tools and
techniques, the publishing and printing industry could
be started to produce books, journals, newspapers,
pamphlets, reports, other publications in a large scale
to cope with the age of information explosion. More than
500 years of history of printing and its associated
activities, publishing scenario is expanded and
reasonably changed in comparison with what it was in
the Gutenberg’s age. In fact, scientists again started to
debate for the paperless or less paper society.
Stages of development:- Since 1985 significant
developments have taken place on electronic publishing.
The concept of document on paper is being changed in
to electronic document, i.e, e-document. An e-document
can be defined as the document existing in an electronic
form to be accessed by computer. The ramifications of
e-publishing, e-publishing is a very broad term that
1
includes a variety of different publishing models, including
electronic books (e-books), Print-on-demand (POD) , email publishing, wireless publishing, electronic ink, and
web publishing.
Evolution of E-publishing:- In 1455 Johnnes Gutenberg
invented his famous printing press with movable type.
And the first book “Gutenberg 42 line Bible” was produced
by Gutenberg’s printing press. In 1490, Aldus Manutius
founded the Aldine press in Venice.
The second land mark in this area as found is the
production of wood pulp paper commercially for the first
time in 1840. In the last century, as it is noticed, the
work of H.G.Wells had got importance. He wrote “World
Brain” in 1938 it is a vision of a vast print encyclopedia
of all human knowledge. Another important invention in
the twentieth century probably was what we call hyper
text. The term ‘Hypertext’ was coined by Ted Nelson in
1965. In 1968, Alen Kay created a card board model of
a Dyna book-a computer with a million –pixel screen.
This was basically a visionary device which Kay claimed
as something more like super-paper. In 1979, Dong
Adams released the popular science fiction novel, “The
Hitchhiker’s Guide to the Galaxy”, in which Protagonist
Ford perfect researchers the galaxy for a vast electronic
book called “The Hitchhiker’s Guide. The Random House
Electronic Treasures is arguably the world’s first
commercially available “Electronic Book” (E-Book) which
is published in 1981. In 1986, Franklin Electronic
publishers embedded an electronic dictionary in a hand
held device, producing the first probable e-book. Sony’s
Data Discman was designed to display CDROM books
on a 3.5 inch screen in 1991. With the blessings of
Internet, e-publishing has got new dimension.
.Librarian, TKM Institute of Management, Kollam, Kerala.
Special issue
November 2015
Page 180
Catagories of E-Publishing:- During the last few years
the e-publishing industry has spread over with increasing
complexities. E-publishing models include commercial
e-publishing, Subsidy e-publishing distributors and selfe-publishing.
Commercial e-publishing – It is much like commercial
printing & publishing. Manuscripts are accepted on the
basis of quality and marketability. Most commercial
publishers then go through the same process of review,
editing, and proof reading before publication as a print
publisher. Commercial e-publishers typically sell their
books through their own website, as well as through
Amazon.com, Barnes and Noble, and other electronic
book stores. Some offer both electronic downloads and
disks or CD ROMs and some also offer print-on-demand
services. Most provide such service as obtained ISBN
Numbers, copy write registrations, and sometimes also
a LC (Library of Congress) listing.
Variety E-Publishing – It is sometimes called Subsidy
publishing since the pays a Subsidy to get a book
published. Subsidy e-publishers, like their print counter
parts, produce and distribute books for a certain fee per
manuscript. Authors receive a royalty, which is usually
comparable to that offered by Commercial e-publishers
(around forty percent). Like commercially published ebooks, Subsidy published e-books are available through
most online book stores.
No–fee distributors - Generally, such a distributor
changes no fee to the author, but take a percentage of
royalties (Usually around 25 to 30 percent).
Electronic Self publishing – It is a process in which the
author is entirely responsible for producing his/her own
book, from development to publication to marketing.
Many authors choose to electronically self-publish their
manuscript. A self-published author receives all revenues
from book sales, rather than a percentage of revenue in
the form of royalties.
E-Book Subscription - There's no shortage of new
developments in the e-book subscription category.
Hoopla, a digital content provider for the library market,
is essentially an e-book subscription service for public
libraries, offering anyone with a public library card access
to all kinds of content. The service launched an e-book
service offering access to thousands of titles (including
comics and graphic novels) as well as movies, music,
TV series, and audio books. DC Comics announced that
it will add 200 of its graphic novels and periodical comics
to Hoopla over the next few months, marking the
publisher's first deal with a library or a subscription
service.
Literature review
The birth of the electronic book has provided publishers
with new methods of serving customers that offer the
Special issue
opportunity to preserve their competitiveness within the
e-publishing and e-commerce markets ( Connaway,
2007)."The e-book market place has developed
considerably in recent years with the emergence of ebook aggregators and the demand from the education
community for e-textbooks and core reading materials"
(JISC, n.d. b).
Despite the rapid increase in e-book revenues and the
evident successes of the last decade, only a small
corpus of research on e-books has developed in the UK
Armstrong et al. , 2006). Projects have been
commissioned by the JISC e-Books Working Group (
JISC, 2008a) on
Collection needs the availability of free e-books,
metadata, and the promotion of e-books and the
publishing of electronic textbooks.
According to the European Commission final report
entitled "Publishing market watch", although e-book
publishing is quickly developing and their use is
increasing, e-books "have not yet been successful in
the European market" ( EC, 2005, p. 103). The report
acknowledges the fact that the book industry "has not
in general responded through technological innovation:
e-books have not yet developed as a force in European
publishing, although print-on-demand is growing,
especially in academic publishing". However, publishers
and aggregators hesitate to produce e-books, especially
in the UK where the uptake of e-books seems to be
slow ( JISC, 2006). Gold Leaf (2003, p. 9) concluded
that: many publishers are reluctant to make their
publications available in e-book format and/or to promote
them too strenuously, because they are afraid of the
effect on their revenues. This is especially true of the
major textbook publishers, who have instead invested
heavily in producing supplementary/complementary
electronic materials to support print books.
The global e-book market
Although the e-book supply has grown markedly during
the last two decades, with an average annual rate of
growth of around 20 per cent, e-books as yet constitute
only a small portion of the total book market place Just,
2007. While, Nelson (2008), has noted that "e-book
sales lag far behind projections and constitute only a
small percentage of the book market", Hook (2001) has
reported that "e-books may still be only a small part of
the total publishing market, but e-book sales are growing,
and many expect big things for the format in the near
future".
Accurate industry sales figures for e-books are elusive.
For instance, there is no established tracking of e-book
sales in Europe due to the low level of their sales (2005).
In the USA, the International Digital Publishing Forum
(IDPF, formerly Open E-book Forum) collects quarterly
November 2015
Page 181
US trade retail e-book sales in conjunction with the
Association of American Publishers (AAP). According
to their first statistics generated in 2002, the sales for ebooks were about US$6 million; for 2006, the sales
exceeded US$20 million; and for 2007, sales increased
to US$31.7 million - a 23.6 per cent growth over 2006
IDPF, 2008). Nevertheless, the 2007 study has its
limitations - it provides only partial data, submitted from
approximately 12 to 15 trade publishers, and represents
only US revenues and trade e-book sales via wholesale
channels. Consequently, the statistics under estimate
the real size of the US trade e-book market. The Statistics
do show a general increase but the volume is still low,
taking into account that the total publishers' net revenues
in 2007 reached US$37.26 billion BISG, 2007).
Methodology
Desk research was used as the main information
gathering tool of the study. Key international competitors
in the e-book market were identified through the literature
and investigation of higher education libraries' catalogued
e-book collections. The preliminary research indicated
that both publishers and aggregators are important
players in the e-book industry in the academic library
sector.
Therefore, data were collected on what e-book vendors
offer to their customers. The data were mainly collected
from the official web sites of 20 major companies - nine
publishers. The selection of this information source was
based on the view that official web sites consist of the
companies' authorised statements and present materials
they promote to their customers. Interviews were not
conducted at this specific phase of the research in order
to avoid the subjectivity of talking to companies'
representatives.
E-book publishers :
•
Blackwell
Reference
Online
(www.blackwellreference.com/public/);
•
Cambridge University Press (www.cambridge.org/);
•
Elsevier (www.elsevier.com/);
•
RSC Publishing (www.rsc.org/publishing/);
•
Taylor & Francis (www.taylorandfrancisgroup.com/);
•
SAGE (www.sagepub.co.uk/);
•
Springer (www.springer.com/);
•
Thieme (www.thieme.com/); and
•
Wiley
InterScience
OnlineBooks
(www.interscience.wiley.com/);
E-book aggregators :
•
Books@Ovid (from Ovid Technologies Inc.)
(www.ovid.com/);
•
Credo Reference (http://corp.credoreference.com/);
Special issue
•
•
•
•
•
•
•
•
•
Dawsonera (www.dawsonera.com/);
Ebook Library (EBL) (www.eblib.com/);
Ebrary (www.ebrary.com/corp/);
Gale Virtual Reference Library (from Gale/Cengage
Learning) (http://gale.cengage.com/gvrl/);
MyiLibrary (from Ingram Digital Group)
(www.myilibrary.com/company/home.htm);
Knovel (www.knovel.com/);
NetLibrary (from OCLC) (www.netlibrary.com/);
Questia (www.questia.com/); and
Safari Books Online (www.safaribooksonline.com/).
Findings and discussion
The most significant findings of the study are presented
and discussed in this section. The first part focuses on
the stages of e-publishing development, evolution of epublishing and categories of e-publishing models include
commercial e-publishing, subsidy e-publishing
distribution and self publishing. The second part gives
an overview of services provided by the selected
companies and is split into two subsections: e-book
publishers and e-book aggregators. Both subsections
cover six areas: e-book vendors' target market(s), e-book
vendors' customer base, number of e-book titles provided
by vendors, subject coverage of vendors' collections, and
methods of purchasing access rights for the libraries.
The e-book aggregators section also provides data on
the number of publishers who use the platforms of the
selected aggregators.
Conclusion
Collection development in relation to e-books generates
a host of issues including: overlaps between e-books
available from different aggregators and how these can
be managed; pricing models; licensing and forms of
ownership; downloading, printing and other access
restrictions; and cataloguing issues. There is
considerable scope for the collection of data covering
some of these issues, such as overlaps in offerings and
access arrangements, and, in other cases, sharing of
practice. Finally, monitoring the adoption of e-books and
the nature of e-book use by users/readers/consumers
is crucial, since this will have consequences for, among
other things, the role of libraries as intermediaries, pricing
strategies and the viability of e-book publishers and
distributors, e-book distribution channels.
References
•
Armstrong, C.J., Edwards, L. and Lonsdale, R.
(2002), "Virtually there? E-books in UK academic
libraries", Program: Electronic Library and
Information Systems, Vol. 36 No. 4, pp. 216-27.
•
Armstrong, C.J., Lonsdale, R. and Nicholas, D.
(2006), "SuperBook: planning for the e-book
November 2015
Page 182
•
•
•
•
•
•
•
revolution", Library and Information Update, Vol. 5
No. 11, pp. 28-30.
Asia News (2007), "S. Korean e-book market
forecast to grow over threefold in 2006", available
at: http://asia.news.yahoo.com/060207/4/2fehb.html
(accessed 11 June 2008).
Bennett, L. and Landoni, M. (2005), "E-books in
academic libraries", The Electronic Library, Vol. 23
No. 1, pp. 9-16.
BISG (2007), Industry Trends 2007, Book Industry
Study Group, New York, NY.
Connaway, L.S. (2007), "The future of e-books", in
Kresh, D. (Ed.), The Whole Digital Library Handbook,
American Library Association, Chicago, IL.
Connaway, L.S. and Wicht, H. (2007), "What
happened to the e-book revolution?: The gradual
integration of e-books into academic libraries",
Journal of Electronic Publishing, Vol. 10 No. 3,
available at: www.journalofelectronicpublishing.org/
COUNTER (n.d.), "Counting online usage of
networked electronic resources", available at:
www.projectcounter.org/about.html (accessed 11
June 2008).
ebrary (2007), "ebrary's global ebook survey",
available at: www.ebrary.com/ corp/collateral/en/
Special issue
•
•
•
•
•
•
Survey/ebrary_eBook_survey_2007.pdf (accessed
11 June 2008).
EC (2004), "Publishing market watch: sectoral report
2:
book
publishing",
available
at:
www.rightscom.com/Portals/0/
European%20Book%20Publishing%20 Report.pdf
EC (2005), "Publishing market watch: final report",
available at: http://ec.europa.eu /information_society/
media_taskforce/doc/pmw_20050127.pdf (accessed
11 June 2008).
Gold Leaf (2003), "Promoting the uptake of e-books
in higher and further education", JISC e-Books
Working Group, London, available at:
www.jisc.ac.uk/uploaded_documents
/
PromotingeBooksReportB.pdf (accessed 11 June
2008).
Google (2008), "Google Book Search", available at:
http://books.google.co.uk/ (accessed 11 June 2008).
Hillesund, T. (2001), "(2001), Will e-books change
the world?", First Monday, Vol. 6 No. 10, available
at: www.firstmonday.org/issues/issue6_10/hillesund/
Hook, B.R. (2007), "Are the e-book 'Barbarians at
the Gate'?", Book Business, Vol. 10 No. 1, available
at: www.bookbusinessmag.com/ (accessed 11 June
2008).
November 2015
Page 183
A STUDY ON CUSTOMER RELATIONSHIP MANAGEMENT WITH
REFERENCE TO BIKE SHOW ROOMS
S. Noor Mohamed Bisool1
Introduction
CRM stands for Customer Relationship Management. It
is a process or methodology used to learn more about
customers’ needs and behavior in order to develop
stronger relationships with them. The more useful way
to think about CRM is as a process that will help bring
together lots of pieces of information about customers,
sales, marketing effectiveness, responsiveness and
market trends. CRM helps businesses use technology
and human resources to gain insight into the behavior of
customers and the value of those customers.
Using CRM, a business can:
•
Provide better customer service.
•
Increase customer revenues.
•
Discover new customers.
•
Cross sell/Up sells products more effectively.
•
Help sales staff close deals faster.
•
Make call centers more efficient.
•
Simplify marketing and sales processes.
The Evolution of CRM
It is not suddenly that the business managers have
realized that the customer is supreme or the need to
render personalized service. However, it was not possible
to address the preferences of a massive group of widely
dispersed individuals. Neither the tools nor the
technology was available. The smart business managers
did the next best thing, which was to conduct a market
research and classify the market into broad segments
with different preferences. The product managers would
(and still do) then position their products catering broadly
to these segments. The commercial penetration of
Internet into the homes changed everything. It provided
the means to take the integrated enterprise information
system to the customer’s living room.
Why should one adopt CRM?
CEOs are realizing those who are not able to come up
with effective CRM strategies risk being edged out of
business. Customer is the king and the business
strategies must be built for ensuring customer loyalty. It
1
costs six times more to create a new customer than
retain an old one.
•
•
•
•
•
Increased sales revenues.
Increased responsiveness.
Increased win rates.
Increased margins.
Reduced cost.
Business Benefits of CRM
Implementing a customer relationship management
(CRM) solution might involve considerable time and
expense. However, there are many potential benefits. A
major benefit can be the development of better relations
with your existing customer, which can lead to:
•
Increased sales through better timing due to
anticipating needs based on historic trends.
•
Identifying needs more effectively by understanding
specific customer requirements.
•
Cross-selling of other products by highlighting and
suggesting alternatives or enhancements. Effective
targeted marketing communications aimed
specifically at customer needs
•
Amore personal approach and the development of
new improved products and services in order to win
more business in the future.
•
Enhanced customer satisfaction and relation,
ensuring that your good reputation in the marketplace
continues to grow
•
Increased value from your existing customers and
reduced cost associated with supporting and
servicing them, increasing your overall efficiency and
reducing total cost of sales.
Role of CRM
•
To identify those customers that are most Valuable
to the organization
•
To segment the organization’s customers in the
most useful way, e.g., by demographics, needs,
value
•
To retain the customers that are most valuable to
the organization
.Measi Institute of Management, Chennai, Tamilnadu.
Special issue
November 2015
Page 184
•
Involves thinking about the economic indicators
relationship intensity
Primary Objective
“A Study on Customer Relationship Management With
Reference To Bike Show Rooms”
Secondary Objectives
•
To study about the existing customer satisfaction
level with bike show rooms
•
To analyze the various customer relationship
parameters with respect to various factors like
turnaround time, cost, quality, services etc.
•
To study about customer retention strategies adopted
by bike show rooms
•
To find out the Impact of CRM on the profitability of
the organization.
•
To know importance and the satisfaction of the
customers relating to various parameters of bike show
rooms.
•
To know the internal and the external factors affecting
CRM practices of bike show rooms
Scope of the Study
•
The study was conducted for bike show rooms and
this could not be used for the further analysis of
other company.
•
The study has value for research that can compare
it with potential in other cities. The study could be
treated as a ground breaking study for market
analysis.
•
The project is done to help the company to maintain
their relationship with the customers and also to
satisfy them through proper service.
•
This project helps the company to improve present
CRM system by providing various suggestions.
•
This project provides guidelines to attract new
customers, retain the existing customers and to
maintain better CRM
Need for Customer Relationship Management
•
Customer Relationship Management leads to
satisfied customers and eventually higher business
every time. And Customer Relationship Management
goes a long way in retaining existing customers.
•
Customer relationship management ensures
customers return back home with a smile.
•
Customer relationship management improves the
relationship between the organization and
customers. Such activities strengthen the bond
between the sales representatives and customers.
Special issue
Limitation of the Study
•
The study was confined to the bike show rooms.
Thus the results cannot be extended to all logistics
present in other parts of the country
•
Due to the time constraint the sampling size was
restricted to around 50 customers.
•
Respondents found it uncomfortable to fill in the
questionnaire because there was managerial
restriction in responding to questionnaire, so they
were not able to communicate effectively
•
Cost was also a major constraint.
Industry Profile
The automobile industry consisting of cars, trucks,
buses, two-wheelers and three-wheelers, is vital to the
growth of the Indian economy. In the last decade their
share in the Indian economy is around 5% of GDP.
Economic progress is indicated by the amount of goods
and services produced which give the impetus for
transportation and boost the sale of vehicles. Increase
in automobile production has a catalyst effect by
indirectly increasing the demand for a number of raw
materials.
Before Independence
Before independence India was seen as a market for
imported vehicles. The assembling of cars manufactured
by General Motors and other leading brands was the
order of the day. Indian auto industry focused on
servicing, dealership, financing and maintenance of
vehicles. Manufacturing started only after a decade from
independence.
After Independence
Till the 1950s the Indian Railways played a pivotal role
in meeting India’s transportation needs. The railways
used to carry 90 per cent of the total freight, while road
transport accounted for the balance. But in the current
context the dynamics have changed. Surface transport
accounts for 65% of freight movement and 80% of
passenger movements. The slow growth of railway
infrastructure has been partly due to administrative
reasons, partly due to difficulty in acquiring land and
partly due to high capital cost involved for every additional
railway line. The Indian automobile industry faced several
challenges and road blocks to growth since
independence. Manufacturing capability was restricted
by the rule of license and could not be increased. The
total production of passenger cars was limited to 40,000
a year for nearly three decades. This production was
also confined to three main manufacturers Hindustan
Motors, Premier Automobiles and Standard Motors.
There was no home grown expertise or research &
development initiative. It was difficult to import scientific
know how and vital spare parts and cumbersome to recruit
November 2015
Page 185
foreign technical experts. Following economic
liberalization in India in 1991, the Indian automotive
industry has demonstrated sustained growth as a result
of increased competitiveness and relaxed restrictions.
Several Indian automobile manufacturers such as Tata
Motors, Maruti Suzuki and Mahindra and Mahindra,
expanded their domestic and international operations.
India’s robust economic growth led to the further
expansion of its domestic automobile market which
attracted significant India-specific investment by
multinational automobile manufacturers. In February
2009, monthly sales of passenger cars in India exceeded
100,000 units.
The automobile industry in Chennai is the base of 30%
of India’s automobile industry and 35% of its automobile
component industry. Chennai is the fourth largest
metropolitan city of the country. It is popularly known as
the “Detroit of Asia” in recognition of the large number of
automotive and auto component companies present. The
industrial area around Chennai is replete with automobile
manufacturing units, assembling units, automotive parts
manufacturing units, and other related industries.
Automobiles manufacturing around Chennai caters to
30% of Indian automobile market. 35% of the automobile
component market of India is also dependent on the
automobile industry around Chennai.
The Future
The Indian automobile industry is expected to grow to
US$ 40 billion by 2015 from the current level of US$ 7
billion in 2008. By the year 2016 the industry is expected
to contribute 10% of the nation’s GDP. The industry
manufacturers over 11 million vehicles a year, employing
more than three million people. The greatest challenge
and competition would be from the Chinese automobile
industry. The Chinese automobile industry has been able
to give stiff completion to India in terms of productivity,
cost of manufacturing and technology. Again the present
trend of excess manufacturing capability, reduced
margins put additional pressure on the industry. The
global recession has had a dampener effect on the
growth of the industry, but market experts believe it is
only a short term phenomenon and are confident of the
industry bouncing back On the positive side, India’s
strength in software sector, combined with skilled labour
and low cost of manufacturing should place it in a
favourable position globally. Recently Ratan Tata,
Chairman (Tata Motors) created history by launching the
world’s cheapest car NANO. The cars pricing is around
one lakh, gaining instant recognition in the automobile
industry across the globe. It heralded the coming to age
of the Indian Automobile Industry.
Customer Relationship Management (CRM) has become
one of the most dynamic technology topics of the
Special issue
millennium. According to Chen and Popovich(2003), CRM
is not a concept that is really new but rather due to
current development and advances in information and
enterprise software technology, it has assumed practical
importance. The root of CRM is relationship marketing,
which has the objective of improving the long-term
profitability of customers by moving away from productcentric marketing.
Goldenberg (2000) believes that CRM is not merely
technology applications for marketing, sales and services
but rather when it is successfully implemented ; it enables
firms to have cross-functional , customer-driven ,
technology-integrated business process management
strategy that maxims relationships.
Descriptive Research
Descriptive research was under taken because the
researcher sought to describe the behavior of variables
and also to infer cause effect relationships. Descriptive
studies are undertaken in many circumstances. When
the researcher is interested in knowing the characteristics
of certain groups such as age, occupation, experience
etc, a descriptive study is necessary. Hence the
researcher has chosen descriptive research method for
the study.
Source of Data
•
Primary Data
Data from primary sources (Customers of various
bike show rooms) have been collected by conducting
the survey with the help of structured questionnaire.
•
Secondary Data
Data from secondary sources have been collected
from both published and unpublished records of the
company, besides standard text books on marketing
management, business magazines, website, etc.,
were also used
Research Instrument
The instrument used for the data collection was the
questionnaire. The questionnaire prepared was
structured with close ended, multiple and rating scales.
Sample Size
The sample size of the survey is 50 customers.
Sampling Method: Convenience Sampling
Convenience sampling is used because any person who
deals with us without any restriction. The sample
comprises subjects who are simply available in a
convenient way to the researcher.
Statistical Tools
•
Percentage Analysis
•
Chi-square Analysis
•
Weighted average Analysis
November 2015
Page 186
Table-1 : Satisfaction on the Immediate or Initials Delivery Quality.
No of
Respondents
Percentage
Highly satisfied
4
8
Satisfied
12
24
Neither satisfied nor
dissatisfied
18
36
Dissatisfied
8
16
Strongly dissatisfied
8
16
Total
50
100
PARTICULARS
Chart Satisfaction on the Immediate or Initials Delivery Quality.
Fig. 1
Inference
From the table, it is observed that 8% respondents belongs to highly satisfied, 24% respondents belongs to satisfied,
36% respondents belongs to neither satisfied nor dissatisfied, 16% respondents belongs to dissatisfied and
16%respondents belongs to strongly dissatisfied.
Chi Square Analysis
Table - 2 : The Relationship Between Year Of Experience And Service Offered
Year of Expereience/ Serive Offered
Special issue
Satisfied
Neutral
Dissatisfied
Total
Less Than 1 Year
6
5
7
18
1 – 3 Years
5
2
3
10
3 – 5 Years
3
2
3
8
Above 5 Years
6
3
5
14
Total
20
12
18
50
November 2015
Page 187
Table - 3 : Chi-Square
Year of Expereience/ Serive Offered
Satisfied
Neutral
Dissatisfied
Total
7.2
4.32
6.48
18
1 – 3 Years
4
2.4
3.6
10
3 – 5 Years
3.2
1.92
2.88
8
Above 5 Years
5.6
3.36
5.04
14
Total
20
12
18
50
Less Than 1 Year
Null hypothesis (Ho): There is no significance different between year of experience and service offered by
bike show rooms
Alternative hypothesis (H1): There is significance different between year of experience and service offered by
bike show rooms
Table - 4
Observed
Frequency(O)
Expected
Frequeny(E)
(O-E)
(O-E)2
X2=(O-E)2\ E
6
7.2
-1.2
1.44
0.2
5
4.32
0.68
0.4624
0.1070
7
6.48
0.52
0.2704
0.0417
5
4
1
1
0.25
2
2.4
-0.4
0.16
0.0667
3
3.6
-0.6
0.36
0.1
3
3.2
-0.2
0.04
0.0125
2
1.92
0.08
0.0064
0.003
3
2.88
0.12
0.0144
0.005
6
5.6
0.4
0.16
0.0286
3
3.365.04
-0.36
0.1296
0.0386
-0.04
0.0016
0.0003
5
Total(X2) = 0.8534
Calculated value ( X2) = 0.8534
Degree of Freedom = (R-1) (C-1)
= (4-1) (3-1)
= 6.
The table value at 5% level of significance for 6 = 12.52
Calculated value = 12.52
Calculated value < Tabulated value
(i.e.) 0.8534 < 12.52
HENCE, ACCEPT NULL HYPOTHESIS.
Inference:
There is no significance different between year of experience and service offered by bike show rooms
Special issue
November 2015
Page 188
Table - 5 : Weighted Average Analysis
WEIGHTS
5
4
3
2
1
FACTORS
HIGHLY SATISFIED
SATISFIED
NEUTRAL
DISSATISFIED
HIGHLY DISSATISFIED
Turn Around Time
4
13
18
8
7
Delivery of Quality
4
12
18
8
8
Process of
Validation
4
14
2
10
20
Service
2
18
12
16
2
Commitment of
Requirement
12
16
10
4
8
Highly Satisfied=5, Satisfied=4, Neutral=3, Dissatisfied=2, Highly Dissatisfied=1.
Table - 6
Factors
Weighted
∑ fw
∑f
X=(∑fw\∑f )
Turn Around Time
4*5+13*4+18*3+8*2+7*1
149
50
2.98
Delivery of Quality
4*5+12*4+18*3+8*2+8*1
146
50
2.92
Process of Validation
4*5+14*4+2*3+10*2+20*1
122
50
2.44
Service
2*5+18*4+12*3+16*2+2*1
152
50
3.04
Commitment of
Requirement
12*5+16*4+10*3+4*2+8*1
170
50
3.4
Ranking Scores
Commitment Of Requirement
Service
Turn Around Time
Delivery of Quality
Process of Validation
:
:
:
:
:
I
II
III
IV
V
•
Inference:
From the survey, it can be observed that most of the
important is given to Commitment of Requirement,
Service, Turnaround Time, Delivery of Quality and
Process of Validation.
Finding of the Studym
•
Association with bike show rooms is 36%
respondents belongs to less than 1 year, 20%
respondents belongs 1 year to 3 years, 16%
respondents belongs to 3 years to 5 years, 28%
respondents belongs more than 5 years.
•
Satisfaction on getting requirements is 8%
respondents belongs to highly satisfied, 32%
respondents belongs to satisfied, 44% respondents
belongs to neither satisfied nor dissatisfied, 4%
respondents belongs to dissatisfied and
•
Satisfaction on their understanding is 32%
Special issue
•
•
•
Satisfaction on the turnaround time is 8%
Satisfaction on the immediate or initials delivery
quality is 8% respondents belongs to highly satisfied,
24% respondents belongs to satisfied, 36%
respondents belongs to neither satisfied nor
dissatisfied, 16% respondents belongs to dissatisfied
and 16%respondents belongs to strongly dissatisfied.
Satisfaction on the process of validation is 8%
Satisfaction on the services is 4% respondents
belongs to highly satisfied, 36% respondents
belongs to satisfied, 24% respondents belongs to
neither satisfied nor dissatisfied, 32% respondents
belongs to dissatisfied and 4%respondents belongs
to strongly dissatisfied.
November 2015
Page 189
•
•
•
•
Satisfaction on the commitment of requirement is
24% respondents belongs to highly satisfied, 32%
How well bike show rooms in getting feedback is
8% respondents belongs to very good, 48%
respondents belongs to good, 16% respondents
belongs to fair, 24% respondents belongs to bad
and 4%respondents belongs to very bad.
Quality is16% respondents belongs to highly
satisfied, 28% respondents belongs to satisfied, 12%
respondents belongs to neither satisfied nor
dissatisfied, 12% respondents belongs to
dissatisfied and 32%respondents belongs to
strongly dissatisfied.
Relationship management is 48% respondents
belongs to highly satisfied, 12% respondents
belongs to satisfied, 16% respondents belongs to
neither
Suggestion and Recommendation
•
CRM should be implemented after creating a
customer strategy/marketing strategy. Many
management thinkers believe that implementing
CRM software is equivalent to creating marketing
strategy. But in real sense, CRM software is just an
enabler to move their strategy into action. Before
implementing CRM software, a company should
formulate appropriate strategy and clarify the purpose
of the strategy.
•
Regular communication with the old customers
should be there so as to retain them and then convert
into lifelong loyal customers.
•
Company must highlight ‘where we are’ in the
project, sharing milestones and informing staff ‘what
happen next.
•
Company should establish contacts with individuals
who have a real interest in the company and products.
•
When the company approaches the wrong people
who do not have any real interest in the company,
they are perceived as stalkers and lose potential
customers.
•
To make CRM effective and successful, there should
be full cooperation and co-ordination of various wings
that are involved in company’s various functions such
as the production processes, latest innovations
involved, marketing practices and healthy
maintenance of employees and customer relations.
Conclusion
Building relationships with customers becomes
necessity in the present scenario of globalization and
Special issue
internationalization of markets. Based on different
analysis, the system of CRM enables to determine the
best strategies and their effective implementation that
company should apply for particular customer groups.
CRM is the system that integrates management of
customer groups, establishment and management of
marketing companies referring to marketing concept;
especially relationship marketing.CRM is to compete
effectively in today’s highly innovative Hi-tech business
world. The most effective one can use the information
about the customers to meet their needs to their full
satisfaction. The route to a successful business requires
that one understands one’s customers and their
requirements, and CRM system is the essential guide.
Generally speaking, the cost of implementing CRM is
quite high. Today implementing CRM is such a major
project that most executives are apt to think that CRM
is a software tool that will manage customer relationship
by itself. Actually in real sense, CRM is the bounding of
customer strategy and processes, supported by the
relevant software, for the purpose of improving customer
loyalty and eventually, corporate profitability. Even though
there are many players offering services, if we can provide
a single window solution with right price, we can persuade
prospective clients to shift their business & seize a
sizeable market share. Most of the players are either
strong in commercial project services or Industrial project
services or facility management services & therefore,
they are not in a position to give wholesome solutions in
all the fields. This gives us opportunity to offer the entire
gamut of bike show room sot clients with efficient
marketing & operation teams in place with a proper CRM
to retain customers
Reference
•
Philip Kotler, Marketing Management (Millennium
Edition), Prentice Hall Of India (P) Ltd., New Delhi,
2001.C.R Kothari, Research Methodology,
WishvaPrakashan, New Delhi, 2001.
•
Uma Sekaran, Research Methods for Business, John
Wiley and Sons Inc., New York, 2000.Amir D.Aczel
and JayavelSounderpandian, Business Statistics (5th
edition), Tata McGraw-Hill publishing company
limited, New Delhi, 2000Gupta, S.P., Statistical
Methods, New Delhi,
•
Sultan Chand & Sons Publishers, Thirty Fourth
Edition, 2005.RajendraNargunkar, Marketing
Research – A Complete Guide.Tony Proctor, Second
Edition, Essentials of Marketing Research, Financial
Times-Prentice Hall Publishing.
•
WEBSITESwww.google.co. in www. ebscohost.
com www. jgate. com
November 2015
Page 190
STUDY ABOUT THE BOTTLENECK OF COOPERATIVE BANKS
Sanitha A.C1
Abstract
Cooperatives Banks are those, which are working especially for the benefit of rural community. They have the
capacity to serve the low class community. They have lot of drawbacks that’s why they can’t compete in this present
scenario. Here the study is concentrated on the weakness of cooperative bank and the main drawbacks are lack of
proper automation, modern facilities, financial resources and professional management. After acquiring adequate
finance, the bank can solve the above three problems easily. Through proper technological advancement s in its
operation, the bank can attract youth and can compete in this present scenario.
Key Words: Cooperative Banks-Organizational Factors-Social Factors-Operational Factors-Loan based Factors
Cooperative Banks
Cooperative Banks are those institutions consisting of
persons who join together as its members on voluntary
basis for the promotion of their common economic
interests. It is generally considered as an organization
of economically weaker sections of the community who
associate together with a view to safeguard their interest
from the exploitation by the stronger sections.
Cooperative movement has made considerable progress
in all the developing countries like India. Cooperation
created human values and also tries to secure better
standard of living to its members. The people are
interested to become a member in cooperative
organization or cooperative sectors, because it provides
different types of loans and assistance. These institutions
help the different sections of society for their development
without any discrimination. They offer the membership
to all people without looking the cast and creed.
Cooperative Banks have good qualities but it has lot of
problems, this leads to big block in its future growth.
Bottleneck of Cooperative Banks
These 4 factors (out of 11 Variables) are derived after
EFA
1. Organizational Factors
Lack of Proper Automation
Lack of Modern facilities
Lack of Financial Resources
Lack of Professional Management
2. Social Factors
More Social commitment
Loss Schemes like OTS/Loan Waiver
More Political Pressure
1
3. Operational Factors
More NPA
Delay in Decision Making
4. Loan Based Factors
Interest Rate for Loan is high
More procedure for sanctioning loan
Background of the Study
1. Sachin R Agrawal and Dr. S SSolanki in their study
“Problems faced by Co-operative Banks and
perspectives in the Indian Economy” revealed that,
the cooperatives have lot of limitations and the major
limitation is lack of technology. So take measures
to add technology in its working and it will help the
m to compete in the modern era.
2. Jyothi Gupta and Suman Jain in their study “A Study
on Cooperative Banks in India with special reference
to Lending Practices” suggested that, cooperative
bank should adopt modern practices like Internet
banking, Credit card, ATM etc., and also to accept
new schemes to attract the new customers.
3. Prof. VirenChavada in his study “Study on Problems
and Issues faced by Co-operative Banks in Indian
Economy” revealed that, cooperatives are in the back
steps because they don’t have the modern facilities
like Net banking, Mobile banking, Online Banking,
E-banking, ATM etc., and the study suggested thatto
accept these to compete in the modern world.
Significance of the Study
Cooperatives are those institutions performing especially
for the benefit rural community. They have good qualities
to serve the economically weaker sections of the society.
It cannot compete along with other financial institutions
.Senior Research Fellow, MG University-Kottayam.
Special issue
November 2015
Page 191
because it has lot of drawbacks. These drawbacks lead
to block in its future developments. These blocks are
called Bottleneck of Cooperatives. So this study is
relevant.
Limitation of This Study
This is only a Case Study based with Sample size of 30
respondents. So its Findings are based on these with
its limitations.
H0: There is no significant difference among educational
qualification with respect to ganizational Factors
H1: There is no significant difference among educational
qualification with respect to
Organizational Factors
1. To identify which factor is most contributing to this
study
2. To analyze is there any difference among age group
with respect to the factor which is more contributed
to the study
3. To analyze is there any difference among educational
qualification of respondents with respect to the factor
which is more contributed to the study
Study is Descriptive and Analytical in nature. Quota
Sampling (Non-Probability Sampling) has been applied
here. Primary Data has been collected (Sample size)with
30 respondents (they are the Borrowers of Cooperative
Bank) from 10th ward of Kaipamangalam Grama
Panchayat of Thrissur District (Population of the study)
by using Questionnaire (Data Collection Tool) with 2
Demographic Questions and 4 Factors (after EFA) based
on Drawbacks of Cooperatives.
Here the distribution is Normal. So parametric tests of
Mean and SD (Descriptive Analysis) and ‘One-Way
ANOVA’ (Inferential Analysis) has been applied here.
Hypothesis for the Study
H0: There is no significant difference among age group
with respect to Organizational Factors
H1: There is a significant difference among age group
with respect to Organizational Factors
Analysis and Interpretation
Reliability Analysis
With the help of “Cronbach’s Alpha”, the 11 statements
are tested and the result is ‘0.604’ and it is good
(Table : 1)
Table - 1 : Exploratory Factor Analysis
Factors
I
2
3
4
Statements
Factor Loading
Eig en Value
% of Variance
Cumulative %
OF1
OF2
OF3
OF4
SF1
SF2
SF3
ORF1
OPF2
LF1
LF2
0.830
0.774
0.652
0.501
0.721
0.716
0.584
0.914
0.600
0.729
0.609
2.650
24.092
24.092
1.761
16.013
40.106
1.632
14.840
54.946
1.360
12.638
67. 314
Note: 4 factors have been extracted out of 11 variables. Here the KMO value is 0.617 and P Value is 0.009 so the
EFA is well and good for this study. Here the study lost only 32.686 % of information content. From the result of
Principal Component Analysis, Variables extracted more are ORF1 (0.0.870) in Factor 3, OF2 (0.803) in Factor 1
and ORF2 (0.765).
Descriptive Analysis
Out of the four factors, the Organizational Factor (Highest mean value of 14.13 and Lowest SD of 3.919) contributed
more to the present study.
N Par test
H0: The distribution is normal
H1: The distribution is not normal
After the One sample KS, P Value is 0.967, so accept the Null Hypothesis, that the distribution is normal
Special issue
November 2015
Page 192
One-Way ANOVA (Parametric Test)
H0: There is no significant difference among age group with respect to Organizational Factor
H1: There is a significant difference among age group with respect to Organizational Factor
Table - 2
Age Group in years
Mean
SD
F Value
P Value
Below 30
11.33
3.786
1.888
0.171
30-60
13.95
3.909
Above 60
16.60
3.209
Note: Here the P Value is 0.171, so accepted the null hypothesis that, there is no significant difference among
age group with respect to the opinion towards Organizational Factors
H0: There is no significant difference among educational qualification with respect to
Organizational Factor
H1: There is no significant difference among educational qualification with respect to
Organizational Factor
Table - 3
Educational Qualification
Mean
SD
F Value
P Value
Below 10th Std
15.63
3.378
0.933
0.439
10th Std -+2
14.29
4.250
+2 –UG
12.29
3.817
Above UG
13.00
-
Note: Here the P Value is 0.439, so accepted the null hypothesis that, there is no significant difference among
educational qualification with respect to the opinion towards Organizational Factor
Findings of the Study
1. Out of the 11 Variables, Variable 1 (OF1) contributing more to this study (Mean 3.77 and SD 1.223) and Variable
4 (OF4) contributing more after Variable 1 (Mean 3.57 and SD 1.406)
2. Out of the four factors, the Organizational Factor (Highest mean value of 14.13 and Lowest SD of 3.919)
contributed more to the present study.
3. There is no significant difference among age group with respect to the opinion towards Organizational Factors
4. There is no significant difference among educational qualification with respect to the opinion towards Organizational
Factor
5. Most of the respondents belong to the age group 30-60 years (73.70%)
6. Most of the respondents belong to the educational qualification between 10th and +2 (46.70%) and 2nd goes to
the educational qualification below 10th Std.
Suggestion
As per the study, most of the people attracted towards Cooperative Bank are belonging to the age group 30-60.
Only 10% of the sample is attracted towards Cooperatives (Below 30 years). So the Cooperatives have to adopt
more from the technology, then only it can overcome these problem.
Conclusion
Here the study is concentrated on the weakness of cooperative bank and the main drawbacks are lack of proper
automation, modern facilities, financial resources and professional management. After acquiring adequate finance,
the bank can solve the above three problems easily. Through proper technological advancement s in its operation,
the bank can attract youth and can compete in this present scenario.
Special issue
November 2015
Page 193
References
•
Sachin R Agrawal and S SSolanki “Problems faced by Co-operative Banks and perspectives in the Indian
Economy”, IRACST-International Journal of Commerce, Business and Management (IJCBM), Vol. 1, No. 2,
October 2012,ISSN:2319 2828, Pp 53-54, http://www.iracst.org/ijcbm/papers/vol1no22012/4vol1no2.pdf
•
Jyothi Gupta and Suman Jain “A Study on Cooperative Banks in India with special reference to Lending Practices”,
International Journal of Scientific and Research Publications, Vol. 2, Issue 10, October 2012, ISSN: 2250-3153,
Pp 1-6, http://www.ijsrp.org/research-paper-1012/ijsrp-p1039.pdf
•
VirenChavada “Study on Problems and Issues faced by Co-operative Banks in Indian Economy”, International
Multidisciplinary Research Journal, Vol. 2, Issue 1, Jan 2015, ISSN: 2349-7637, Pp 1-3, http://www.rhimrj.com/
admin/upload/JAN15020104.pdf
Special issue
November 2015
Page 194
ONLINE SHOPPING IN KOTTAYAM: AN EMPIRICAL EXAMINATION OF
ITS CUSTOMER SATISFACTION PERSPECTIVES
Sanju P Cherian1
Abstract
Online shopping has become new type of retail shopping. It has now been adopted all over the world including
Kottayam. This study envisages finding out “customer satisfaction towards online shopping”. This study explored the
major factors that may influence customer’s online shopping satisfaction in Kottayam region. Descriptive research
design was used for the study. This paper is an account of the quantitative research study based on primary data
derived through structured instrument. it was found that consumers purchasing decisions were dependent on various
factors like Low price, reliable, website design, security and privacy, time saving, safety and customer service. The
article concludes by considering the implication for future research.
Introduction
With the rapid development of network technology,
electronic commerce and e-marketing had been formed
and developed gradually, thereby forming new business
model and business chance which exerted an important
influence on the country’s economic future development
and international competitiveness. Online shopping
(sometimes known as e-tail from “electronic retail” or eshopping) is a form of electronic commerce which allows
consumers to directly buy goods or services from a seller
over the Internet using a web browser. Change is occurring
at an accelerating rate; today is not like yesterday, and
tomorrow will be different from today. Continuing today’s
strategy is risky; so is turning to a new strategy. In the
past decade, there has been a dramatic change in the
way consumers have altered their shopping behavior.
Due to the increasing usage of smart phones and internet
penetration, people can easily access internet and shop
via online networking sites. This has brought new
companies to concentrate on online retailing. On-going
advancements in information and communication
technologies (ICT) are providing the basis for the
emergence of what, at the macro level, has been referred
to as the ‘new economy’ (Kling and Lamb 2000, p. 296).
There will be a continuing push toward deregulation of
the economic sector. These three developments—
globalization, technological advances, and deregulation
— spell endless opportunities.
There are many understandings of the ‘new economy’
but it is here discussed in the more specific sense of
the use of digital technologies for widening business
practices in the development, production, sale, or
1
provision of goods or services also referred to as the
‘digital economy’ (Kling and Lamb 2000, p. 297). Internet
retailing seems to be growing in all parts of the world,
including developing countries. The Internet population
is younger, more affluent, and better educated than the
general population, with an almost equal number of men
and women. But as more people find their way onto the
Internet, the cyberspace population is becoming more
mainstream and diverse. Internet users in general place
greater value on information and tend to respond
negatively to messages aimed only at selling. They want
to decide what marketing information they will receive
about which products and services and under what
conditions. In on-line marketing, it is the consumer, not
the marketer, who gives permission and controls the
interaction. Internet consumers have around-the-clock
access to varied information sources, making them better
informed and more discerning shoppers. Due to the
changes taking place in the economy in connection with
the technological opportunities provided by the Internet,
there is no reason to think that e-commerce is only a
passing phenomenon (Baily and Lawrence 2001, p.
311)Online retailing (or, ‘e-tailing’, ‘business-tocustomers’ e-commerce (B2C)) evolves along with the
emerging technological systems around the Internet. The
expression ‘new economy retail strategies’ is here
understood as referring to both online retailing and the
network relationships that correspond to different online
retailing strategies. As part of these strategies,
information technology (IT) offers a broad spectrum of
opportunities for connecting retailers, their supply chains
and centrally customers (Borenstein and Saloner 2001).
The exact content and extent of these developments
.MBA student SMBS, MG University
Special issue
November 2015
Page 195
are still covered by clouds of uncertainty both
technologically and economically (related to
technological development, financial possibilities –
especially presently as the ‘patience’ of capital has
diminished – consumer behaviour, competition,
regulation, extent of collaborative effort in activity clusters,
etc.). The recent quick swing from dotcom mania to
dotcom crisis needs to be acknowledged at the outset.
For a sustainable growth in business the company has
to adapt the new environment. So it has turn out to be
important for retailers to adapt this changing environment.
This study aims at identifying customer satisfaction
towards online retailing. Scope of the study limited to
the online customers at Kottayam district who have made
online purchases at least once.
findings because, ID authentication while making online
transaction and credit system is not available in China.
Research Question
In this research, through the literature study and survey
method, I will try to get answers for the following
questions
1. Why customers prefer online shopping?
2. What are the influencing factors while making online
shopping?
(Kim, 2005) has conducted an empirical study in UK on
online customer satisfaction. The results show that ten
factors on index are good exponents of satisfaction, such
as website design, time saving, privacy, securitysafety,
reliable, ease of use, product quality, customer services
and service quality
Research Objectives
This study regarding “customer satisfaction towards
online shopping “will be accomplished by the following
objectives
1. To identify the factors that may influence customer’s
online shopping satisfaction at Kottayam
2. To identify the most important factor among the
factors that may influence customer’s online
shopping satisfaction at Kottayam
Literature Review
(Vegiayan, 2013) identified the factors that may
influence customer’s online shopping satisfaction. The
study is used the quantitative approach to achieve the
objectives .Data collected through online survey by using
‘E-survey creator’ and ‘SPSS’ was used to analyze data.
The study shows that purchase quality has the highest
relationship as well as highest influence towards the
customer satisfaction.
(liu, He, Gao, &Xie, 2008) have conducted an empirical
study on Chinese customers for online shopping. The
outcome of their research shows that customer services
are strongly, predictive of online shopping customer
satisfaction. Further, delivery and customer service has
very important role in Chinese market. The first
impression is the design of website, its contents, which
can improve customer satisfaction. Continence and easy
to use function can save time and improve satisfaction.
Finally, Security and privacy becomes spotlight in their
Special issue
In another study done by (Alkarim,2013) prove that
customer purchasing decisions were dependent on
various factors like information availability, less
expensive, best offers, time saving and service quality.
According to customer’s opinions, time saving is the
most important motivating factor for online shopping.
(Harn , 2013) conducted a study showed that user
satisfaction with the website is decided by information
quantity, design, transmission speed, user-friendliness
of search structure, and update pace. It suggests that
website characteristics are likely to influence consumer
information search through the internet.
(Jarvelainen, 2007) Turku, Finland, has shown in her
empirical study, there are many online information
seekers who, decide to stop the shopping process, just
before the completion of the transaction. The reason is
deeply rooted in the Internet based trust results. The
study concentrates on e-commerce environment, i.e.
security and privacy issues, and how consumers choose
their purchasing channels.
(Jiang, Jones, &Javie, 2008) have shown in their
empirical study, about US customer worries on Internet
security, while shopping over the Internet can influence
online buying behavior and these worries may lead to
identity theft. A good strategy to increase consumer trust
while ordering online could be third-party certification
programs.
(Suki&Suki, 2007) have conducted an empirical study,
in Malaysia. They proposed a model, to identify the
influence of perceived value, perceived risk and perceived
enjoyment on online consumer’s innovativeness, in
relation to adoption of online shopping. In the results
perceived risk was prominent indicator. To assess
Malaysians online shopping behavior, e-retailers should
observe perceived risk as prominent indicator.
Malaysians risk perception and concern about online
shopping, are mostly related to privacy and security
issues. In which, privacy and security of personal
information, online transaction security and uncertainty
of product quality are included.
A quantitative research approach was adopted in this
study to explore the major factors that may influence
November 2015
Page 196
customer’s online shopping satisfaction in Kottayam region.. The source of data collection has been primary as
well as secondary. The source of secondary data has been journal articles, research papers, Ph. D thesis etc.
Updated information from various secondary sources has been collected and used in this paper.
The primary data has been collected using a structured questionnaire which consists of 13 questions using a 5point Linker scale to analyze the factors that may influence customer’s online shopping satisfaction. The sample
size of data collected using convenient sampling technique.
Table - 1
Research Type
Descriptive research
Sampling Technique
Convenience sampling
Sample Unit
Online shopping customers in Kottayam
Sample Size
50
Tools For Data Collection
Questionnaire
Tools For Data Analysis
Percentage analysis method
Variables
Website design, low price, reliable, Security and privacy, time saving,
Safety, customer service
I am satisfied with the ease of use of the online website
Fig. 1
I am satisfied wiith the ease of use of the online website
%
20%
30%
18%
50%
Fig. 2
The result of 50 % rating “agree” and 30% rating “strongly agree” is an indication that majority of online shoppers are
satisfied with the ease of use of the online website.
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Page 197
ONLINE PRODUCTS ARE LOW PRICE
Fig. 3
Online products are price
0%
4%
34%
18%
44%
Fig. 4
A high demand is observed for low price factor. The result of 34% rating” strongly agree” and 44% rating “ agree” is
an indication that majority of online shoppers are agreed with this statement “online products are low price”
The products are packed safely
Fig. 5
Special issue
November 2015
Page 198
0%
4%
10%
22%
64%
Fig. 6
The result of 22% rating “ strongly agree” and 64% rating “ agree” is an indication that majority of online shoppers
are satisfied and do not face any problem of product package. It is surprising to note a percentage of 0 on delivery
of broken goods which shows that customers are quite satisfied with the condition of items received through an
online purchase.
It is time saving to purchase online
Fig. 7
It is time saving to purchase online
0%
10%
10%
44%
36%
Fig. 8
A high demand is observed for time saving factor. The result of 44% rating “ strongly agree” and 36% rating “ agree”
is an indication that majority of online shoppers are agreed that time saving is a major influencing factor in online
shopping.
Special issue
November 2015
Page 199
SERVICE QUALITY
Fig. 9
I am satisfied with online shopping service quality
0%
2%
12%
28%
58%
Fig. 10
Out of 50 samples, 29 respondents were agree with the online shopping service quality. At the same time, the 28
% of neutral population also needs to be addressed.
Online product warranty policies are satisfactory
Fig. 11
Special issue
November 2015
Page 200
0%
6% 2%
16%
42%
34%
Fig. 12
A high demand is observed for providing warranty policies to the customers. Total 76 % of respondents strongly
agreed and agreed the warranty policies. This indicates that warranty services are very reliable.
I get better online services as compare to in-store services
Fig. 13
I get better online services as compare to in-store services
0%
10%
18%
36%
36%
Fig. 14
36 % respondents “agree” that online services are better than in-store services. At the same time a large portion of
people are neutral. They believe that both online and in-store services have no particular different.
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November 2015
Page 201
Table – 2 : Sample statistics
Number
Questions
Mean Value
Scale Range
1
How often do you shop online
3.06
Once a month
2
I am satisfied with the ease of use of the online
website
4.08
Strongly agree
3
The websites are reliable
3.94
Agree
4
My privacy and security is taken care in online
shopping
3.8
Agree
5
Online products are low price
4.08
Strongly agree
6
4.04
Strongly agree
7
It is time saving to purchase online.
4.14
Strongly agree
8
I am satisfied with online shopping service quality
3.8
Agree
9
3.34
Agree
10
I get better online services as compare to in-store
services
3.38
Agree
Result and Discussion
When asked about the “ease of use of the online website” The result of 50 % rating “agree” and 30% rating “strongly
agree” is an indication that majority of online shoppers are satisfied with the ease of use of the online website.
Respondents also have given interesting opinion about the “reliability of online websites”. Nearly two third respondents
somehow agreed that online websites are reliable The result of 54% rating “ agree” and 14% rating “strongly agree”
is an indication that majority of online shoppers are satisfied and do not face any problem of privacy and security
compared to 2 % who disagree. A high demand is observed for low price factor. The result of 34% rating” strongly
agree” and 44% rating “ agree” is an indication that majority of online shoppers are agreed with this statement
“online products are low price”.
Respondents also have given interesting opinion about “time saving factor in online shopping”. Nearly two third
respondents somehow agreed that time saving is a major influencing factor in online shopping. When asked about
the “online shopping service quality” respondents have given different opinion. More than 50 % of respondents were
considered that online shopping service quality was good. Rests of them were either neutral or disagree. A high
demand is observed for providing warranty policies to the customers. Total 76 % of respondents strongly agreed
and agreed the warranty policies. This indicates that warranty services are very reliable.36 % respondents “agree”
that online services are better than in-store services. At the same time a large portion of people are neutral. They
believe that both online and in-store services have no particular different. Online customers expect much privacy
and security from the websites, which in turn, would help the industries to create a good trust and image into the
minds of its online customers. Ease of use, low price, safety and time saving variable shows to have highest
relationship with the customer.
Conclusion
The Endeavour of this study is to identify the influencing factors while making online shopping. Therefore, from the
findings it was found that consumers purchasing decisions were dependent on various factors like Low price,
reliable, website design, security and privacy, time saving, safety and customer service. The study was done with
an overview of current and past research works done on related topics and with the help of quantitative data
collection. The study was on conducted among the Kottayam respondents who respond very well to the research
study and the respondents were prolific in their responses and they were very good at their answers which implies
that the respondents had a good understanding of the website and how it functions. Similar study could focus on
service quality and product quality impact on customer satisfaction and loyalty, which was found to be quite low in
this research project. This might be of value for the industry. Future research can consider the impact of other
variables such as, e-ethics, and third party certification.
Special issue
November 2015
Page 202
Bibliography
•
Harn, P.,(2008). Web navigation behaviour of Malaysians in relation to online purchasing. International journal of
business and society,
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Jarvelainen, J. (2007). Online purchase intentions: An empirical testing of a multiple-theory model.
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Journal of organizational computing and electronic commerce,
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Jiang, P., Jones, D. B., &Javie, S. (2008). How third party certification programs relate to consumer trust in
online transactions: An exploratory study. Psychology & Marketing.
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Kala Devi veginyan (2013), “online shopping and customer satisfaction in malaysia”.International journal of
marketing practices
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Kim, H. R. (2005). “Developing an index of online customer satisfaction.” Journal of financialservices marketing.
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liu, X., He, M., Gao, F., &Xie, P. (2008). “An empirical study of online shopping customer satisfaciton in China:
A holistic perspective”. International Journal of Retail & DistributionManagement.
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Ruskie, L. (2007). The EPSI index applied to a Danish business club Poland customer satisfaction analysis.
Master’s Thesis . Aarhus School of Business.
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Rashad Al Karim (2013), “customer satisfaction in online shopping: a study into the reasons for motivations and
inhabitations”. Journal of business and management
•
Suki, N. M., &Suki, N. M. (2007). Online buying innovativeness: Effects of perceived value, perceived risk and
perceived enjoyment. International journal of business and society
Special issue
November 2015
Page 203
CONSUMER PREFERENCE TOWARDS ORGANIC VEGETABLE
Zita V Bosco1
Boniface P.J2
Abstract
This study investigates the consumer preference towards organic vegetables. The objectives are: 1) To analyze the
consumer preference towards organic vegetables in Thrissur town area. Sampling Frame used for analysis is simple
random sampling, of which 30 organic consumers in Green Mythri at Athani are surveyed. Data were gathered from
pre- structured interview schedules, observations and also from secondary sources such as Magazines, Journals,
Published articles, Newspapers, published thesis, internet sources etc. The data collected were analyzed using
Percentage analysis, index, satisfaction index and attitude index. In the present context, organic products are became
more important because consumers are health conscious than price conscious. Organic vegetables are grown
without use of chemical pesticides so that they have no harmful effects of chemical fertilizers .Farmers are also well
known about importance of organic farming. They are converting their farm land into organic land. Consumers have
high preference towards organic vegetables. They are purchasing organic vegetables from retail outlets. Some
consumers have their own farm productions. Inorganic consumers are aware about organic vegetables .Price of the
organic vegetables can’t afford by common men. Taste and nutrient value are the important attributes of organic
vegetables. The level of consumer satisfaction towards organic vegetables revealed that they are moderately satisfied
with taste, nutrient value, freshness, value for money and source of information. They are moderately satisfied with
price, availability and marketing channel. The important factor which influence the consumer preference towards
organic vegetables are chemical free pesticide, ecofriendly, health aspect. As a whole, we would be conclude that the
consumers high preference towards organic vegetables.
Key Words: organic vegetables, consumer satisfaction consumer preference, organic retail outlets
Introduction
International Federation of Organic Agriculture
Movements defines organic agriculture - “Organic
agriculture is a production system that sustains the
health of soils, ecosystems and people. It relies on
ecological processes, biodiversity and cycles adapted
to local conditions, rather than the use of inputs with
adverse effects. Organic agriculture combines tradition,
innovation and science to benefit the shared environment
and promote fair relationships and a good quality of life
for all involved...”
The organic food means organic produce and other
ingredients that are grown without the use of pesticides,
synthetic fertilizers, sewage sludge, genetically modified
organisms, or ionizing radiation. In the case of animals
that produce meat, poultry, eggs, and dairy products do
not take antibiotics or growth hormones.
Today food are not intended to only satisfy hunger but
to provide nutrients for human. We know that vegetables
are rich source of nutrients but now -a -days these
vegetables are more poisonous by using this chemical
fertilizers. Here lays the importance of the organic
vegetables. Organic vegetables that are grown without
1
2
the use of chemical pesticides, weed killers or fertilizers.
The farms are typically more traditional and involve all
natural pesticides. They are advantages by purchasing
organic vegetables, we can support farmers who are
cultivating organic vegetables, safer than conventional
vegetables
In 20 th century, we witness technological upgrading in
agriculture. These upgrading leave the remark on
landscape and rural population. Invention of machinery
has reduced the labor and increase the chemical
pesticides and fertilizers. This industrialized agriculture
destruct the ecological balance and effect the agricultural
production. Food safety and quality issues triggered the
consumer awareness and people start to think about
organic foods and vegetables The farmers in Kerala are
convinced that the only way is to return to the traditional
sustainable ways of cultivation without harming the
ecosystem. Thus the organic farming, a system with
the broad principle of ‘live and let live’, came up which
was recognized nationally and internationally. There is
a rich potential for promoting organic farming in Kerala
in the light that intensity of inorganic agriculture here is
.Research Scholar, Dept. of rural marketing management, KAU,Thrissur
.Research Scholar, Dept. of rural marketing management, KAU,Thrissur
Special issue
November 2015
Page 204
not severe compared to that in other states in the
country. The state department of agriculture commenced
organic farming promotional activities since 2002-2003.
Today society is showing great interest to their and health
and prefer foods with more nutritional value and more
concentrated natural production methods. The
consumption pattern of the consumers is changing day
by day. People are shifting their preference from
conventional farming to organic farming. Through this
shift people believed that they will be healthier and the
future generation can be saved from many diseases.
Hence it is necessary to understand the changing
behavior of the consumers, to clearly identify the reasons
for the shift in preference and to identify the demand for
the organic vegetables in the future
Objectives of the Study:
To analyze the consumer preference and satisfaction
towards organic vegetables ,
Materials and Methods
Location of the study
The study was conducted in Green Mythri supermarket
in Athani in Thrissur district.
Period of the study
The study was conducted during the period from 1st
January 2015 to 30th may 2015.
Sample Design and Data collection
The study was based on both primary and secondary
data. Primary data were collected through a structured
interview schedule covering the objectives of the study
.A sample of 30 organic vegetable consumers were
selected for the collection of primary data. Secondary
data were collected from reports, Journals and internet
for understanding the current importance.
Data analysis
The collected data were analyzed and interpreted with
the help of appropriate statistical tools such as
percentage and indices.
Analysis and Discussions
Source of Purchase of Organic Vegetables
The purchase place is the preference of the consumers
towards a particular place for purchasing the product.
For analysing the place preferred by consumers,
respondents were asked to specify their preferred place
of purchasing organic vegetables (Table : 1)
Special issue
Table - 1 : Source of purchase of vegetables by
consumers
No.
Source
Number of
respondents
Percentage
(%)
1
Own farm
production
2
6.6
2
Direct from
neighbour farmers
9
30
3
Whole sale market
4
13.3
4
Retail market
15
50
Total(N)
30
100
Table 1 revealed that 15(50percent) respondents are
depending on retail market . They opined that availability
and convenience of purchasing is the major reason for
preferring retail market. It can also be noticed that 30
percent purchased vegetables from neighbouring farms.
Nature Of Consumers Preferring Organic Vegetables
Consumers vary in their consuming pattern. The nature
of consuming vegetables by organic consumers is
given in Table 2
Table - 2 : Nature of vegetables consumed by
organic consumers
No.
Consumer
Number of
respondents
Percentage
(%)
1
Inorganically
grown vegetable
Nil
Nil
2
Organically grown
vegetables
30
100
Total(N)
30
100
Table 2 reveals that 30(100 per cent) respondents are
organic consumers.
Period Of Purchasing Organic Vegetables
Period of purchasing organic vegetables means how long
the product has been in use by the respondents. It is
very important to know about the period of purchase
(Table : 3)
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Table - 3 : Period of purchasing organic
vegetables
No
Period
Number of
respondents
Percentage
(%)
1
Below half year
7
23.3
2
One year
13
43.3
3
One-two year
10
33.3
Total
30
100
Table 3 shows that13 (43.3 percent) consumers are using
organic vegetables for period of one year. From this
table, most of consumers are using organic vegetables
for one year.10 (33.3 per cent) of respondents are using
organic vegetables for more than one year. By this we
understood that consumers are health conscious.
Preference of Consumers towards Organic
Vegetables
Table - 4 : Preference of consumers towards
organic vegetables
Consumer Satisfaction towards Organic Vegetables
The consumer satisfaction measures whether the organic
vegetables can meet the consumer expectation. By
Table 6 we can analyze the satisfaction of consumers
towards organic vegetables.
For this purpose different statements related to organic
vegetable were selected and data collected on 5 point
scale of Likert summated rating. A satisfaction index
was constructed by giving weightages of 5 points from 5
to 1(highly satisfied and highly dissatisfied).For this
purpose of interpretation index score was rated as
follows.
Less than 30 - Highly Dissatisfied(HDF)
30-50
- Moderately Dissatisfied (MDF)
50-70
- Resigned (R)
70-90
- Moderately Satisfied (MS)
90 and above - Highly Satisfied(HS)
Consumer satisfaction about the organic vegetables is
given in Table 6
Table - 6 : Consumer satisfaction towards organic
vegetables
No
Preference
Number of
respondents
Percentage
(%)
No
1
Yes
30
100
1
2
No
NIL
NIL
Total
30
100
Score
Index
Rating of
index
Price
112
74.66
MS
2
Taste
116
77.30
MS
3
Nutrient value
122
81.33
MS
4
Freshness
105
70.00
MS
Table 4 shows that all the consumers 30(100 per cent)
preferred organic vegetables. The reason behind the
preference of organic vegetables is presented in Table 5
5
Shelf life
109
72.67
MS
6
Availability of
vegetables
94
62.67
R
Table - 5 : Reason for preferring organic
vegetables
7
Marketing
channels
116
77.33
MS
Items
No
Reason
Number of
respondents
Number of
respondents
Percentage
(%)
8
Ecofriendliness
132
88.00
MS
1
Better taste
10
10
33.3
9
Hygiene
129
86.00
MS
2
Eco-friendly
9
9
30
10
108
72.00
MS
3
Hygiene
3
3
10
Source of
information
4
Nutrient
value
8
8
26.6
11
Authenticity
110
73.33
MS
12
133
88.67
MS
Total
30
Value for
money
13
Composite
index
1423
79.06
MS
30
100
Table 5 revealed that eco-friendly and better taste of
organic vegetables are the major reason for preference
followed by nutrient value. 10 per cent respondents are
preferring organic vegetables because of hygiene factor.
Special issue
Source : Primary data
Table 6 reveals that consumers were moderately
satisfied with price, nutrient value, freshness, shelf life,
marketing channel, hygiene, source of information and
authencity of organic vegetables. Organic vegetable is
November 2015
Page 206
tasty .So that the consumers are moderately satisfied
with taste of organic vegetables. They have resigned stage
in respect to availability of vegetables.
Findings and Suggestions
The present study was an attempt to analyze the
preference of consumer towards organic vegetables, with
special reference to Green Mythri. Data were collected
from 90consumers, out of which 30 were wholly organic
vegetables consumers and rest was common consumers
from Thrissur town area. The consumers coming to one
outlet which sells organic vegetable, Green Mythri at
Athani was surveyed. Secondary data were collected
from the reports, Journals and internet. The study helped
to understand the preference, attitude and satisfaction
level of consumers towards organic vegetable. The
collected data were analyzed and interpreted with the
help of appropriate statistical tools such as percentage
and indices.
The major findings of the study include preference,
attitude and satisfaction level of consumers towards
organic vegetables
Findings
I. In the case of organic vegetable consumers, majority
of them were spending 1000-1500 for purchasing
organic vegetables .Most of them were spending
500-1000 for vegetables in the case of inorganic
consumers
II. In case of organic vegetable consumers, majority
were purchasing vegetables daily.
III. Major source of purchase of organic vegetables were
from retail market.
IV. In case of organic consumers, major reason for
purchase of organic vegetables was chemical free
pesticide.
V. In case of organic consumers, majority of the
consumers preferred towards organic vegetables.
VI. In case of organic consumers, majority of
respondents have highly favorable attitude with
organic vegetables because of the quality, nutritious
value and taste.
VII. Organic vegetable consumers are satisfied with
organic vegetables due to its taste and nutritious
value.
Special issue
Suggestions
I. The Government and other institutions may extend
financial support to organic farmers to minimize the
financial risk in adoption of organic farming.
II. Consumers should be properly informed on the value
for money and health aspect of the organic
vegetables.
III. Awareness campaign about organic vegetables
should be made to the public
IV. More value added products of organic vegetables
should be introduced into the market.
V. More organic outlets should be open
Conclusion
The analysis and findings of the study highlights
consumer preference towards organic vegetables and
their level of satisfaction.. They are preferring organic
vegetables because of chemical free and taste. Organic
users are satisfied with organic vegetables due to its
quality, taste and health aspect etc. Consumers overall
attitude towards organic vegetables were not favorable
due to its high price and non-availability. However they
agree with the health aspects, quality, nutrient value and
environment friendly nature of the organic vegetables.
This study concluded that consumers have high
preference towards organic vegetables but common man
can't afford the price of organic vegetables.
References
•
Assis, K. and Ismail, H.A.M 2011. Knowledge,
attitude and practices of farmers towards organic
farming.Int.J.Eco.Res.2 (23):1-6.
•
Chandrasekhar, H.M.2014.Consumer perception
towards organic products-a study in Mysore
city.Int.NGO J.5 (1):34-39.
•
Hossain, T. 2007. Adoption of Organic Rice for
Sustainable Development in Bangladesh.
•
Journal of Organic Systems
•
Malissiova ,E. , and Govaris,E., 2013 .consumer
attitude and behaviour towards safe food.Food
Control . 34( 1): 241-248
November 2015
Page 207
POST-HARVEST VALUE ADDITION IN JACKFRUIT- SCOPE FOR FPO
Varnana Nair1
Dr.P Shaheena2
Abstract
Jackfruit plays a significant role in Indian agriculture and culture. It was cultivated in India 3,000-6,000 years ago.
Jackfruit is widely grown as an important tree in Kerala’s homesteads and also as a shade crop in coffee plantations.
It is popularly known as poor man’s fruit in the eastern and southern parts of India. The tender fruits of the tree are
used as vegetable and the ripe ones as table fruits. The analysis revealed that Jackfruit is widely grown as an
important tree in Kerala’s homesteads. Commercial cultivation of jackfruit is still at a primitive stage in India. Kerala
Agricultural University has developed many value added products of jackfruit. Jackfruit is a commonly seen fruit,
once it is the life saver of people but now it is become one of the underutilized fruit, post-harvest value addition is a
solution to this problem. Majority of the people were not even heard about the different value added products. Lack of
supervision, training and guidance were the major problems identified in this study. But majority of the people are
ready for value addition if proper assistance is given. The farmers were willing to join FPO to earn more income. The
study showed that there is an immense potential for Farmer Producer Organization for jackfruit. The composite index
about the farmer’s perception regarding the value added products of jackfruit stood high, which is an indication that
acceptability for such products are also high. There is a prospective market for these products in India as well as
outside the country and has a good export market potential for jack fruit. The study showed that there is a good scope
for setting up jackfruit processing units in jackfruit growing areas. This unit helps the farmers to utilize the perishable
fruit and generate more employment opportunities in rural areas
Key words: FPO –Farmer Producer Organization, post-harvest value addition
Introduction
The jackfruit, said to be the biggest fruit in the world, is
native to the foothills of the Western Ghats, scientifically
known as Artocarpus heterophyllus, and the tree belongs
to the Mulberry family. In India, the total area under
jackfruit cultivation is approximately 1,02,552 hectares,
of which, an estimated 1,00,000 trees are grown in back
yards and as intercrop in other commercial crops (betel
nut, coffee, pepper and cardamom plantations) in South
India. In India, the major area under jackfruit is in Kerala
state and it was regarded as heavenly fruit in the ancient
periods. It is grown in an area of 89,701 ha with annual
production of 300 million fruits and productivity of 3,568
fruits per ha. (2012-13).
Jackfruit occupied 29% of the category of fresh fruits
and it has 1st position in this category. Idukki, Kozhikode
and Malappuram districts stand 1st, 2nd and 3rd
positions with 15%, 11% and 9% area respectively during
2011-12. In Kerala, two varieties of jackfruit predominate:
varikka and koozha. Varikka has slightly hard inner flesh
when ripe, while the inner flesh of the ripe koozha fruit is
very soft and almost dissolving. Jack fruit processing
has improved during the last few years. The Krishi Vigyan
Kendra’s and CFTRI Mysore has developed technologies
1
2
for processing and preserving, which has made it possible
to produce a marketable product which can easily be
handled, packaged in attractive packing, transported and
stored before sale.
Indian economy is predominately agrarian and hence
prosperity of our country is possible only through rural
development. Increased production, productivity and
proper postharvest care of farm produce which supply
food and raw materials for different agro based industries
should get attention. The postharvest facilities to handle
and process have not developed in tandem with
production. As a result 25-30 percent of produce is lost
every due to lack of scientific knowhow on postharvest
management. This is especially true in the case of fruits
which are highly perishable in nature. It is heart burning
to note that tropical fruits such as jackfruit, papaya,
cahewapple etc. suffer from a postharvest loss to the
tune of 70-90 percent. These natural resources, which
are treasures of nutrients if properly processed and used
could contribute substantially to the food and nutritional
security of our country. Jackfruit, the biggest fruit in the
world is grown in an area of 89701 ha in Kerala with a
production of 300 million fruits. Jackfruit is highly a safe
fruit as far as the consumers are concerned since it is
. Research scholar, College of Co-operation Banking and Management
. Faculty, Department of Development Economics, College of Co-operation Banking and Management
Special issue
November 2015
Page 208
devoid of any chemical residues of insecticides,
pesticides, fertilizers etc. due to lack of scientific
processing and value addition a big chunk of the
production (approximately 60 percent) is simply wasted.
interview schedule and secondary collected from
different sources such as print and online publications.
The collected data analyzed using statistical tools such
as percentages, indices
Kerala has an eminent role in the production of jackfruit
in India. The area under cultivation is 89701 ha in Kerala
and the production exceeds 31crores/year. However
commercial cultivation of the crop is comparatively very
less. Instead home stead cultivation is the main practice
done by the people. A major share of jackfruit is
underutilized. Fully ripened jackfruit bulbs can be used
to prepare jams, squashes, syrups, candy, fruit bars,
fruit leather, ready-to-drink beverages, halwas,
payasams, puddings, toffee, wine, kulfi and ice-cream.
Half-ripened bulbs are processed to jackfruit powder and
used for the preparation of bakery items such as burfi.
The rind is rich in pectin and can be used for the
extraction of natural pectin and preparation of jelly. Apart
from better utilisation of perishable fruit this would also
result in considerable value addition. The jackfruit was
once Kerala’s life-saver in months of scarcity, but
recently this under-utilised, under-exploited fruit in homes
and hotels. Farmers fail to recognize the opportunities
of jackfruit cultivation where a single bulb of jackfruit
sells Rs.3 to 5 outside Kerala. Very high degree of
spoilage/ wastage occurs in each stage of production of
jackfruit. Currently Jackfruits are used during the season
as a fruit or as a vegetable ingredient for a several
traditional Indian dishes. During off season, it is used
as fried or dried chips, or as a canned fruit. However
almost 80% of the Jackfruits in India are going waste as
there is no organized market for Jackfruit based products
and Chefs are reluctant to use Jackfruit for three reasonsseasonal, messy to prepare and the aroma spreads in
the kitchen
Farmers can overcome this hindrance trough
collectivizing the surplus products under one roof named
Farmer Producer Organizations. It will enhance their
bargaining power and can easily adjust for technology
adaptation in value addition. Considering this ground
issue as a focus, a study is attempted to identify the
existing and potential jackfruit farmers and scope of
formation of FPO to enhance benefit through value
addition to them.
Analysis
Objective of the Study
1. To Analyse the perceptions of farmers on forming a
Farmer Producer Organization for value addition in
Jackfruit.
Table - 1 : Gender and age of respondents
Sex
Male
Female
Total
20-30
1
7
8 (13)
30-40
3
13
16 (27)
40-50
7
10
17 (28)
>50
12
7
19 (32)
Total
23 (38)
37 62)
60 (100)
Age
Source: Primary Survey conducted in
Gramapanchayth during 13- 20 August 2014
Vettikkavala
Note: Figures in the bracket shows percentage to the total
From the table it is clear that out of the 60 respondents
23 (38 per cent) are male and 37 (62 percent) are female.
It could be seen from the table that most of the farmers
(32 per cent) belong to the age group of more than 50
years of which 12 are male and 7 are female. Only 8
respondents are included in the 20-30 age category.
Table - 2 : Total land holdings of the respondents
Land
Land
Total
Area
Owned
Leased
32 (53)
Sub Marginal
30 (87)
2 (13)
20 (33)
Marginal
19 (94)
1(6)
8 (14)
Small
8(100)
0
60 (100)
Total
57 (95)
3 (5)
Source: Same as Table 4.2.1
Sub Marginal = <1 acre, Marginal= 1-2.5 acre, Small= 2.5-5 acre
It is clear that 53 per cent of the respondents hold less
than one acre land i.e. they are coming under the category
of sub marginal farmers among the sub marginal and
marginal farmers, 87 per cent and 94 per cent
respectively in the marginal category have owned land
for cultivation. Only 4 per cent respondents have an
ownership holding of 2.5-5 acre (small farmers). Of the
total respondents, only 5 per cent operates leased in
land. It can be inferred that majority of the farmers in
that area possess own land for cultivation (Table : 3)
Methodology of the Study
Both primary and secondary data were used for the
study. The primary data collected through structured
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November 2015
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Table - 3 : Membership details in association of respondents
Membership
Area
Total
Yes
No
13 (22)
19 (32)
32 (53)
Marginal
5 (8)
15 (25)
20 (33)
Small
1 (2)
7 (12)
8 (13)
Total
19 (32)
41 (68)
60 (100)
Sub Marginal
The table reveals that only 32 per cent of the respondents have membership in association. It may be noted that the
respondents are members of the Self Help Groups and the affiliating organization is Kudumbashree. It may be a
natural outcome of the fact that all are females and majority (22 per cent) belongs to the sub marginal category.
From the small holder category only one person has membership in Kudumbasree.
Table - 4 : Distribution of households according to the number of stands
No of stands
Size of land
holding
Varikka
Varikka
Total
Planted
Naturally grown
Planted
Naturally grown
<1 acre
17
32
3
80
132 (4)
1 - 2.5 acre
8
16
1
65
90 (4)
2.5 – 5 acre
5
12
1
20
38 (5)
Total
30
60
5
165
260 (4)
Note: Figures in the bracket shows average number of holdings per households
The table indicates the distribution of jackfruit in household according to the number of stands. The two varieties of
jackfruit are popular in Kerala - varikka and koozha. From the survey it is revealed that the varikka is less in number
compared to koozha. The 60 households have a total of 260 jack tree, out of which 90 are varikka and 165 are
koozha. The study also revealed that 87 per cent of the trees were grown naturally, which shows that tree can be
grown without much care and attention. The crop is resistant to the climatic variations in Kerala, thus making it one
of the most suitable perennial crops for the agro climatic zones of the state. Moreover, the cost associated with is
negligible. Nevertheless, people prefer varikka variety for planting rather than koozha.
Area, production and productivity of jackfruit
The production of jackfruit here calculated as Kg and the average size of jackfruit is taken as 25 Kg.
Table - 5 : Area, production and productivity of jackfruit
Number of Jack
tree
Production (no of fruit)
Production (Kg)
Productivity
<1 acre
132
3280
82000
244.74
1 - 2.5 acre
90
2330
58250
255.00
2.5 – 5 acre
38
1140
28500
300.00
Total
260
6750
168750
259.61
Area
Note: Productivity refers to Production/acre
The table shows the area under cultivation of jack (both varikka and koozha) and its production and productivity.
Production is more in sub marginal category i.e. 82000 kg and less in small ie 28500 with total production of 168750
fruit from the 260 jack trees. The overall productivity is 2S9.61, out of the total surveyed area i.e. 6473 acre.
(Table : 6)
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Table - 6 : Perception of Respondents towards
growing Jack trees
Table - 8 : Details of sale of jackfruit in the
previous years
No. of Respondents
Essentiality of jackfruit
trees in a house
Major share of jack
production is wasted
Yes
48 (80)
33 (55)
No
12 (20)
27 (45)
60 (100)
60 (100)
Total
From the survey it can be concluded that 80 per cent of
the households have the opinion that jack trees are
essential in a house. The table also indicates the opinion
of households regarding the wastage of jackfruit. It can
be inferred that 55 per cent of the households viewed
that major share of jackfruit production is wasted in their
area and nearby houses. The jack tree, for generations
upon generations, has been treated as a member of every
household. jack tree, which, with no special care, used
to offer varieties of nutritious and delicious food items
Table - 7 : Marketable surplus of Households
Area
No of
Self
Marketable
Production
households
consumption surplus
<1 acre
32
1180 (17)
900 (19)
280 (14)
1 - 2.5 acre
20
1990 (30)
1400 (29)
590 (31)
2.5 – 5 acre
8
3580 (53)
2500 (52)
1080 (55)
Total
60
6750
4800
1950
The Table explains that 32 households belongs to the
sub marginal category have a production of1180 number
of jackfruits in the previous year, among that 900 were
used for self-consumption. Marketable surplus is high
in small category i e 1080 and also production is high
(3580). The three categories together contribute
marketable surplus of 1950 jack fruit. Out of the total
production of jackfruit (6750) 53 per cent is contributed
by small sector, 30 per cent by marginal and the
remaining 17 per cent by marginal sector. The
consumption and surplus are also high in Small
category, 52 per cent and 55 per cent respectively. The
number of households in the small category is less (8)
but they posses minimum six jack trees in their land
and the production is also high. From the table it can be
inferred that there is a marketable surplus (Table : 8)
Special issue
No. of Respondents
Percentage
Yes
4
7
No
56
93
Total
60
100
The table shows that only 7 per cent of the household’s
sale jackfruit, the remaining households was used for
self consumption, feed for cattle, giving to neighbors and
some part are wasted.
Table - 9 : Details of sale of jackfruit to the
private dealers
Channel
Respondents
Quantity
Price
Private dealers
on locality
4
150
15000
None
56
-
-
Total
60
150
15000
The table shows that the main customers of jackfruit
are Private dealers on locality. Only four were selling
their jackfruit to the dealers. There are no specific agents
for selling jackfruit. Respondents sell jackfruit to the
agents who approach them. The dealers themselves
arrange for harvesting and they bears all related costs
like transportation cost, labor cost etc. Mature jackfruit
has more demand in the local and export market. So all
the four respondents are selling jackfruit in tender form.
The dealers prefer varikka rather that koozha the price
of varikka is also higher than that of koozha. In the
previous year, they sold 150 jackfruits with Rs.10 each.
They are satisfied with the prices.
Table - 9 : Awareness of demand of jackfruit in
the market
No. of Respondents
Percentage
Yes
12
20
No
48
80
Total
60
100
The table shows that 80 per cent of the households are
not aware about the demand of the fruit in the market.
The jackfruit was once Kerala's life-saver in the months
of scarcity, but recently jackfruit is being highly underutilized in Kerala. It's even gaining popularity outside
Kerala – a single bulb of fruit sells for Rs.3 to 5 outside
Kerala and abroad
November 2015
Page 211
Conclusion
In Kerala, jackfruit is a commonly seen fruit, once it is
the life saver of people but now it is become one of the
underutilized fruit. When compare with other fruits like
banana, the cost of production is very less and it could
grow without any proper care. Post harvest value addition
of jackfruit is a solution to this problem. Kerala
Agricultural University developed value addition
technologies in jackfruit and they made more than 21
products out of it. Because of lack of training, supervision
and guidance it is till now in the initial stage. More than
70 per cent of the people are not even heard about the
different products. The fruit is very big so time consuming
is a problem among the people. But majority of the
people are ready for value addition if proper assistance
is given.
There is a prospective market for these products in India
as well as outside the country. It has a good export
market potential for jack fruit. There are millions of
Keralites in gulf countries who knows the nutritious value
of jack fruits. Nobody has to teach them to buy it. In
Special issue
view of the above, it is seen that there is good scope for
setting up jackfruit processing units in jackfruit growing
areas. This will not only help the farmers to utilize the
perishable raw material but also generate more
employment opportunities in rural areas.
In Kerala Jackfruit is now a honey stream fruits for birds
and insects. It is grown extensively in Kerala without
any bodies caring. It is very popular all over India also
and is believed to be of Indian origin. Fully ripe jackfruit
is sweetie and has an exotic flavor. The bulbs (the edible
flesh) contain 7.5% on dry weight basis and a fair amount
of Vitamin A. The seeds are rich in Carbohydrates and
are used for culinary purposes. Ripe fruits are utilized in
the preparation of packaged fruits, nectar and jams.
Unripe fruits are also used for preparations of food
supplements. The Krishi Vigyan Kendra’s and CFTRI
Mysore has developed technologies for processing and
preserving it, which has made it possible to produce a
marketable product which can easily be handled,
packaged in attractive packing, transported and stored
before sale.
November 2015
Page 212
A STUDY ON MOTIVES FOR ENTREPRENEURIAL INTENTIONS AMONG
WOMEN TELECENTRE OWNERS IN KERALA
Sreejith S1
Abstract
‘Akshaya’ is an initiative of the Government of Kerala, envisioned at enhancing the spread of e-literacy, among public
with added focus in rural areas, through Public Private Partnership (PPP) mode. The project was launched in November
2002. It brought to fore the enormous managerial and entrepreneurial talent that remains untapped. The moderate
number of women entrepreneurs who have come forward with the choice of a career by starting an Akshaya Telecentre
is a significant development to reckon with in the subject. A telecentre is a community centre that offers shared access
to Information and Communication Technologies (ICT) for the purpose of community development and poverty
reduction. Entrepreneurial motivation is vital in translating entrepreneurial intention into action. The study integrates
Push Pull theory of motivation with entrepreneurial intentions. It identifies that, women Telecentre entrepreneurs in
Kerala are more likely to be pulled than pushed into entrepreneurship. Push factor of Telecentre Entrepreneurs is
derived from the variables such as flexibility in life, Economic Necessity, Test My Own Ideas and Personal Growth and
Satisfying Work Relationship. Pull factor of Telecentre Entrepreneurs is derived from the variables such as Wealth
Creation, Independence, Social Status, Securing Future and Personal Achievement.
Keywords: Psychological Motives, Entrepreneurial Intention, Akshaya, Telecentre, Factor Analysis.
Introduction
‘Akshaya’ is an initiative of the Government of Kerala,
envisioned at enhancing the spread of e-literacy, among
public with added focus in rural areas through a Public
Private Partnership (PPP) programme. Akshaya
telecentres acts as the information communication
access point to the public, following a spread of one
centre for every 1000 families living in two or three
municipal or panchayath wards. The project was
launched in November 2002 modeled as a social
entrepreneurship. A telecentre is a community centre
that offers shared access to Information and
Communication Technologies (ICT) for the purpose of
community development and poverty reduction (UNDP APDIP, 2007). The Government of India has envisaged
the National e-Governance Plan (NeGP) to set up 2,
50,000 telecentres in India with the objective to make
all government services accessible to the citizen through
Common Service Centres (CSCs).
Background of the Study
The role of access to ICT in the development of a society
is a universally accepted fact, and with this intention
many countries in the world accepted a plan of action at
the World Summit on the Information Society WISS
conference held in Geneva during December 2004. Kerala
is the most literate State in the country with a high Human
1
Development Index. (Planning Commission,
2002).Akshaya project is initiated based on the report‘Entrepreneurship Development and Mass Employment
Generation in IT Sector in Kerala’, a study conducted
by Science and Technology Development Project. The
project aims to bridge the digital divide starting from
Panchayath (LSG) level.
Telecentres need to be run like an enterprise to achieve
financial pillar of the telecentre sustainability (Proenza,
2002) (Raul & Colle, 2002). National level policy that
support deregulated and regulatory framework for
national telecentre programme could be able to build
telecentre infrastructure for the nation (Jauernig, 2003).
It is noticeable that generating gender equity was not
part of the objectives and the strategies behind the
Akshaya programme (Kumar & Ghatak, 2007). It is in
the expansion phase of Akshaya that a quota of onethird was set aside for recruiting women entrepreneurs
(IT for change, 2008). The Project has brought to the
fore the enormous managerial and entrepreneurial talent
of women that remains untapped.
The number of women who have come forward with the
choice of an entrepreneurial career by starting an
Akshaya e-centre is significant. The women
entrepreneurs account for around 33% of the total
. Assistant Professor in Management, School of Legal Studies, CUSAT.
Special issue
November 2015
Page 213
entrepreneurs of the project selected in the first level in
seven districts (Akshaya Project Office, 2010).
Entrepreneurial motivation has been reported to be a
link between intention and action (Carsrud & Brännback,
2011). So knowledge about the motives that influence
individuals to start a business is vital. The motivation to
start a business depends on identifying the role model,
that one can emulate and who would become a source
of inspiration and learning to other individuals. (Bandura,
1986). So it is required to learn about the motives of
women owners of Akshaya telecentres.
1. To examine the women entrepreneur’s motives for
opening Akshaya telecentres
2. To identify the difference of importance between push
and pull factors among women tele centre
entrepreneurs.
Scope of the Study
The study is planned to throw light on the influence of
push pull factors among women entrepreneurs. The
study is of relevance to different telecentre stake holders
and has many policy implications. Above all, the result
of this study may motivate women entrepreneurs to have
internal retrospection to review their entrepreneurship
intentions. Further this state of mind of people who wish
to create a new firm is of greater influence.
Descriptive research design is used for carrying out the
study. The researcher has collected both Primary and
secondary data for the study. A preliminary study and
extensive literature review have been carried out. The
scope of World Wide Web for collecting data was
exploited. Secondary data regarding Akshaya
Telecentres in Kerala was collected from Akshaya State
Project Office Thiruvananthapuram. Primary data was
collected from the Akshaya Entrepreneurs (respondents),
using a pre-tested questionnaire. A sample size of 150
was conveniently fixed for the study.
Type of Data
Both Primary and Secondary data were used for this
study. The primary data were derived from the answers
given by the respondents in the self-administered
questionnaire prepared by the researcher. The data
derived from research studies and literatures have been
included in this study.
Data Analysis
The questions and responses were coded and entered
in the computer using Microsoft Excel software.
Required analysis was done with the aid of Statistical
Package for Social Sciences 21.0 Version. Certain
Special issue
statistical methods such as Factor analysis, Friedman
test etc were applied on the data to get the results.
Limitations of the Study
The research is confined to importance of ten motivation
variables of entrepreneurship initiation.
Analysis & Discussion
The sample size fixed for the study is 150. Respondents
of the study were classified on the basis of demographic
profile of the respondents.
Profile of Respondents
Demographic profile of the respondents based on their
age, religion, marital status, education and their major
source of income were considered in this study.
Ages of the respondents were classified into three groups
such as below 30, 30-40 and above 40. The study
considered religions such as Hindu, Christian and Islam
for this research paper. The study considered
classifications of respondents such as unmarried,
married and divorced marital statuses. Education-wise
classification of respondents such as high school, plus
two, degree and post graduate level educations also
considered. The table furnished below shows the
summary of the respondent’s profile.
Dimensions of motivations
The study tries to identify entrepreneur’s perception
regarding the stage of psychological hierarchy they
belong to. Dimensions of motivations were measured
using ten statements which quizzed on their drives
behind commencing the business. The respondents
were asked to rate these factors in a 5 point scale in the
order of importance. Further, these ratings were converted
to rank Friedman test method was used to ascertain
the rank of psychological motives.
Table - 1 : Ranking of Psychological Motives
Item
Mean Rank
Personal Growth
6.65
Social Status
6.11
Independence
6.03
Satisfying Work Relationship
5.87
Personal Achievement
5.82
Test my Own Ideas
5.70
Flexibility in Life
5.59
Securing Future
4.34
Wealth Creation
4.20
Economic Necessity
3.62
November 2015
Page 214
Test Statistics - Friedman Test
N
Chi-Square
Df
Asymp. Sig.
350
366.365
9
.000
It is evident from the table 1 that the biggest driver is
personal growth, closely in pursuit with social status,
followed by Independence, personal achievement,
flexibility in life, satisfying work relationships, testing
own ideas, securing future, wealth creation, economic
necessity, in that order. In the study of entrepreneurship,
one recurring area of interest is what motivates individuals
to become entrepreneurs (Zimmerman & Chu, 2013).
Motives provide insight into the entrepreneur’s intentions
and problems affect the start up and growth of a business
(Yaclin & Kappu, 2008). Factors of entrepreneurial
motivation (P.Dubini, 1988) is related to the following
a. Achievement- It is related to sense of individualism,
accomplishment and development.
b. Philanthropy – It is related to welfare of the individual,
family or community.
c. Status – It is related to recognition, prestige and
respect.
d. Materialism – It is related to economic consideration
e. Escape – It is related to escape from an undesirable
condition
f. Freedom – It is related to flexibility of work, time
and collaboration.
g. Role Model – It is related to continuing family
tradition
Push Pull Theory among Women Entrepreneurs
The distinction between push and pull factors is also
implicitly present in the Model of the Entrepreneurial
Event arguing that the act of starting up a business is
dependent upon a change that occurs in the life of an
individual, i.e., a displacement (Shapero and Sokol,
1982). Push factors mean those influences, which push
individuals toward entrepreneurship. Pull factors mean
influences, which pull people towards entrepreneurship
In terms of push motivation, the first argument was that
unemployed individuals or individuals with low prospects
for wage-employment may become self-employed to earn
a living (Oxenfeldt, 1943). The effect of unemployment,
lowering the opportunity costs of self-employment,
thereby driving individuals to start their own business,
is often referred to as the push effect of unemployment.
In addition to unemployment, Giacomin et al. (2007)
mention the push motivations of autonomy and family
pressure, for example in case of a business transfer to
Special issue
the new generation (Giacomin, Guyot, Janssen, &
Lohest).
Factor 1 derived from the analysis consist of variables
such as flexibility in life, Economic Necessity, Test My
Own Ideas and Personal Growth and Satisfying Work
Relationship. So a sum of all these can be called as
Push factors of Telecentre Entrepreneurs.
Table - 2 : Rotated Component Matrixa
Variables
Push Factor
Flexibility in Life
.806
Economic Necessity
.759
Test my Own Ideas
.717
Personal Growth
.669
Satisfying Work
Relationship
.567
Pull Factor
Independence
.731
Social Status
.680
Securing Future
.608
Wealth Creation
.502
Personal Achievement
.474
Source: Primary Data, Extraction Method: Principal Component
Analysis.
Rotation Method: Varimax with Kaiser Normalization. a.
Rotation converged in 3 iterations.
As with push motivation, pull motivation may come in
different forms distinguish between three pull motivations:
market opportunity, social status and profit (Giacomin,
Guyot, Janssen, & Lohest). There evidence for four
motivational constructs such as recognition,
independence, learning and roles. Which provide
evidence of a multitude of pull motivations, including the
need for approval, independence, personal development,
improved welfare and wealth, and following role models
(Shane, Kolvereid, & Westhead, 1991). In spite of the
role played by each of the different motives in the
explanation of entrepreneurship, it has been found that
the wish to be independent is the dominant factor
explaining new venture creation (Scheinberg &
MacMillan, 1988). Gender differences were found in the
incidence of motivations, women were more influenced
by a desire for independence (Kirkwood, 2009).
Following are the derived variables of factor 2 during the
factor analysis, Wealth Creation, Independence, Social
Status, Securing Future and Personal Achievement. It
can named as pull factors of telecentre entrepreneurs
Result of the t test is shown in the table below. It
compares the importance of push and pull factors among
telecentre entrepreneurs. The maximum score for each
factor were set as 25 for this analysis.
November 2015
Page 215
Table - 3 : Result- t test
Entrepreneurial
Motivations
N
Mean
Std. Deviation
Std. Error Mean
Push
156
10.3846
2.52078
.20182
Pull
156
23.7115
4.53660
.36322
t
-32.072
Sig. (2-tailed)
.000
Individuals are more likely to be pulled than pushed into entrepreneurship (Birley & Westhead, 1994). The table no
3 shows the level of importance of women entrepreneurs to initiate Akshaya Telecentres in Kerala. The result also
shows that their pull motivational factors are influenced more than push factors. The mean score for pull factors is
23.71 with a standard deviation of 4.53, whereas the score for push factors is 10.38 with a standard deviation of
10.38. The t test result shows that the scores are statistically different at 95 % Confidence Level.
Major Findings
It is evident from the above study that 94% of the telecentres are in the form of sole proprietorship. Majority of the
centres (40%) are established in between 2006-2009 followed by 2002 to 2005 and 2013-2013 i.e 28% each. 50%
of the women Akshaya entrepreneurs used bank loan as their primary source of capital. On the other hand 44% of
them have used their personal assets. 48% of the telecentres raised 3-5 lakh rupees for the capital of the business
followed by 1-3 lakh (30%). It is worth to note that 49% of women telecentre owners are acting as financial controller.
There are nominal representations of operator and manager roles. But 27% of them have responded that they are
not representing any above roles. They may be acted as a supporting staff or act as a dummy entrepreneur on
behalf of others.
The biggest motivation driver for Telecentre entrepreneurship among women in Kerala is personal growth, closely in
pursuit with social status, followed by Independence, personal achievement, flexibility in life, satisfying work
relationships, testing own ideas, securing future, wealth creation, economic necessity, in that order.
The study integrates Push Pull theory of motivation with entrepreneurial intentions. It identifies that, women Telecentre
entrepreneurs in Kerala are more likely to be pulled than pushed into entrepreneurship. Push factor of Telecentre
Entrepreneurs is derived from the variables such as flexibility in life, Economic Necessity, Test My Own Ideas and
Personal Growth and Satisfying Work Relationship. Push factor of Telecentre Entrepreneurs is derived from the
variables such as Wealth Creation, Independence, Social Status, Securing Future and Personal Achievement.
Conclusion
The moderate number of women entrepreneurs who have come forward with the choice of a career by starting an
Akshaya Telecentre is a significant development to reckon with in the subject. Entrepreneurial motivation is vital in
translating entrepreneurial intention into action. The study integrates Push Pull theory of motivation with entrepreneurial
intentions. It identifies that, women Telecentre entrepreneurs in Kerala are more likely to be pulled than pushed into
entrepreneurship. Push factor of Telecentre Entrepreneurs is derived from the variables such as flexibility in life,
Economic Necessity, Test My Own Ideas and Personal Growth and Satisfying Work Relationship. Push factor of
Telecentre Entrepreneurs is derived from the variables such as Wealth Creation, Independence, Social Status,
Securing Future and Personal Achievement.
Reference
•
Akshaya Project Office. (2010). Achievements. Retrieved January 2015, from Akshaya Project: http://
www.akshaya.kerala.gov.in/index.php/achievements
•
Bandura, A. (1986). Social foundation of thought and action-A social cognitive theory. Englewood Cliffs. New
Jersey:: Prentice-Hall.
•
Birley, S., & Westhead, P. (1994). A taxomy of business start-up reasons and their impact on firm growth and
size. Journal of Business , 7-31.
•
Carsrud, A., & Brännback, M. (2011). Entrepreneurial motivations: What do we still need to know? Journalof
Small Business Management , 9-26.
•
Giacomin, ,. O., Guyot, Janssen, & Lohest. Novice creators: personal identity and push pull dynamics. Louvain
School of Management.
•
IT for change. (2008). Retrieved January 2015, from IT for Change: http://www.itforchange.net/sites/default/files/
ITfC/E-Krishi.pdf
Special issue
November 2015
Page 216
A STUDY ON QUALITY OF WORKLIFE AT INDIA INFOLINE, COCHIN
S. Soumya1
Dr. N. Ramkumar2
Abstract
Quality of Work Life is becoming an increasingly popular concept in recent times. It basically talks about the methods
in which an organization can ensure the holistic well-being of an employee instead of just focusing on work-related
aspects. It is a fact that an individual’s life can’t be compartmentalized and any disturbance on the personal front will
affect his/her professional life and vice-versa. Therefore, organizations have started to focus on the overall development
and happiness of the employee and reducing his/her stress levels without jeopardizing the economic health of the
company. The major objective was to gain an insight into the Quality of Work Life at IIFL. The secondary objective was
to study is the perception of employees in overall development, employee satisfaction with the safety facilities and
employee’s perception in participation in decision making process. Census study is used which includes the entire
population of 50 employees of IIFL, M G Road Branch, Ernakulam was selected for the study. A structured questionnaire
was designed to collect information. The collected using the questionnaire was analyzed and interpretations and
suggestions was given based on the results of analysis. Categorization was done based on different demographic
factor and mean perception score for different groups were found out. The hypotheses developed for the study were
tested using t-test and ANOVA. The project concluded that employees of IIFL have a better quality of work Life. And
the employees are satisfied with the safety facilities and their role in decision making.
Introduction
The phrase “quality of work life” has been used to evoke
a broad range of working conditions and the related
aspirations and expectations of employees. It also
encompasses a wide range of programs, techniques,
and theories that have been developed in an endeavor to
reconcile the twin goals of efficiency and an improved
social environment in modern workplaces. Quality of work
life (QWL) is viewed as an alternative to the control
approach of managing people. The QWL approach
considers people as an ‘asset’ to the organization rather
than as ‘costs’. It believes that people perform better
when they are allowed to participate in managing their
work and make decisions.
This approach motivates people by satisfying not only
their economic needs but also their social and
psychological ones. To satisfy the new generation
workforce, organizations need to concentrate on job
designs and organization of work. Further, today’s
workforce is realizing the importance of relationships and
is trying to strike a balance between career and personal
lives. Successful organizations support and provide
facilities to their people to help them to balance the
scales. In this process, organizations are coming up
with new and innovative ideas to improve the quality of
work and quality of work life of every individual in the
organization. Various programs like flex time, alternative
work schedules, compressed work weeks,
1
2
telecommuting etc., are being adopted by these
organizations. Technological advances further help
organizations to implement these programs successfully.
Organizations are enjoying the fruits of implementing
QWL programs in the form of increased productivity, and
an efficient, satisfied, and committed workforce which
aims to achieve organizational objectives. Quality of
Working Life is a term that had been used to describe
the broader job-related experience an individual. Elizur
and Shye, (1990) said that quality of work performance
is affected by Quality of Life as well as Quality of working
life. However, it will be argued here that the specific
attention to work-related aspects of quality of life is valid.
Quality of working life remains relatively unexplored and
unexplained. A clearer understanding of the interrelationship of the various facets of quality of working
life offers the opportunity for improved analysis of cause
and effect in the workplace. This consideration of Quality
of working Life as the greater context for various factors
in the workplace, such as job satisfaction and stress,
may offer opportunity for more cost-effective interventions
in the workplace.
IIFL is a share broking firm, so the organization has a
hectic work environment. This study focused on gaining
an insight into the quality of work life at India Infoline Ltd
in M G Road branch Ernakulam, how well the
management maintaining the works, working conditions,
. Assistant Professor, Sree Narayana Gurukulam College of Engineering
. Assistant Professor, PSG Institute of Management. Coimbatore.
Special issue
November 2015
Page 217
safety, rewards and other facilities to the employees to
do the job in effective manner.
Primary Objective
To gain an insight into the Quality of Work Life at India
Info Private Limited, M G Road Branch, Ernakulum
Secondary Objective
To understand the perception of Quality of Work Life in
the overall development of an employee.
To understand employee satisfaction with the safety
facilities provided by the organization.
To study the perception of employee on their participation
in decision making process.
Scope of Study
The study is limited to India Infoline Ltd, M G Road
Branch, Ernakulam on quality of work life.
Literature Review
Quality of work life refers to the favorableness of a total
job environment for people. QWL programs are another
way in which organizations recognize their responsibility
to develop jobs and working conditions that are excellent
for people as well as for economic health of the
organization.
Factors affecting quality of work life:
The factors affecting quality of work life are job
satisfaction, pay, people, health conditions, career
prospects, management style, work environment, stress
level at work, etc.
The notion “quality of work life” (QWL) is closely related
to the “Quality of life” concept. Both emerged relatively
recently in the industrialized nations where English was
the primary language. Parallel concept such as
“humanization of work” is also used. In France and other
French-speaking countries, the usual expression is
“improvement of working condition”, while in the sociality
counties the established term is “workers protection”.
In Scandinavia, the central concepts are “working
environment” and “democratization of the workplace”.
In its broadest usage, QWL simply means the sum total
of “values”, material and non-material, attained by a
worker through his life as a salary earner. Thus it includes
aspects of work-related life such as wages and hours,
work environment, benefits and services, career
prospects and human relations, which could possibly
be relevant to worker satisfaction and motivation. In the
narrowest sense, the QWL may refer to the positive
“value” level of a given job as it affects the worker. Such
interpretation carries with it an implied claim that
improvements in work organization and job content in
particular should receive special consideration for
enhancing the “value” level of the individual’s working
Special issue
life. Hence QWL may be considered as a set of new
labor problems and have gained recognition as important
determinants of worker satisfaction and productivity in
many societies during the period of their sustained
economic growth.
QWL implies a nice and safe work environment. But
people want to feel respected at work for what they do
and who they are. They want good communications with
superiors, fellow workers, and customers, other than
being part of a team. Above all, people need to feel valued
for their skills, knowledge and their participation in the
creative improvement process. Without this, people can
be comparatively well paid and still be dissatisfied with
the quality of their work life. The major catalyst for
research on quality of work life has been the influx of
women, including those with young children and other
family obligations into the labor force. This trend began
to escalate in the 1960s where new technology was
predicted to transform people’s lives and produce a
leisure age of shorter working weeks. Women were
beginning to enter male-dominated careers, resulting in
phenomena such as dual-career couples and the equity
of gender roles. However, the predicted reduction in
working hours did not come about. Instead, a period of
industrial strife, conflict, and retrenchment ensued in
the 1970s.
Research explored antecedents and consequences of
work-family conflict and stress, recognizing the
multiplicity of variables affecting individual well-being.
Increasingly, experiences in work and family not only
spill over between domains but also cross over to affect
other family members. Therefore, quality of work
experience rather than work per se became the focus of
attention. Research questions of the 1970s and 1980s
on the impact of maternal employment of children, initially
based on assumptions about women’s roles and young
children’s needs were being replaced by concern about
the impact on children and other family members of
parents’ experiences of pressurized work.
The period from the mid 1990s see the context of
globalization and increasingly sophisticated technology,
restructuring of organizations and non-permanent work
in most advanced industrialized societies towards
flexible workforces. The consequences of this changing
workplace are the anxieties and other problems that
accompany feelings of job insecurity. Many workers are
spending more time in the workplace in response to job
insecurity, workplace demands, perceived career needs,
financial pressures, and so forth. Without job security,
employees are less committed to their organizations
and may feel freer to move to other jobs. To a large extent,
they reflect increased workloads and unrealistic
deadlines as a consequence of downsizing. The rise in
working hours has been greatest among members of
November 2015
Page 218
dual-earner and especially professional dual-career
families, and time pressures from work are particularly
intense during the life-cycle stage including the
childrearing years which suggest pressurized family
lives. In addition, boundaries between work and non-work
time have become more blurred as organizations become
increasingly virtual and more people work at or from
home for all or part of the week using information and
communication technologies (Lewis & Cooper, Without
doubt there are situations where there exists
opportunities for flexibility and autonomy.
Quality of work life is gaining importance due to certain
reasons, Firstly, newly acquired economic maturity
appears to be one of the principal causes of the increased
concern for improving the QWL. Secondly, many of the
current problems are not the result of deteriorating social
and working conditions, but rather, a consequence of
heightened worker expectations and aspirations.
Moreover, a number of aspects traditionally considered
to be important are gradually giving way to new concerns.
Thirdly, new problems affecting the QWL fall into several
categories. Some have surfaced as a result of new
technological and social developments and others
represent changing and accelerating concerns with
regard to their compatibility.
Measuring the Quality of Work Life
In order to measure relevant issues of interest or
importance organizations have long used surveys of
employees. Information gathered from such surveys is
typically used to identify problems, strengths and
weaknesses within a particular organization or with
identifiable groups within that organization.
The concept of Quality of Work Life, however, goes
beyond measuring employee’s experiences within a
particular organization and encompasses a wider value
set that is specific to individuals. Therefore, measuring
issues that the specific or of importance to an
organization, risks overlooking issues that are important
to individuals working in the organization. Quality of Work
Life is a dynamic multidimensional construct that
currently includes such concepts as job security, reward
systems, training and career advancement opportunities,
and participation in decision making. As such Quality of
Work Life has been defined as the workplace strategies,
operations and environment that promote and maintain
employee satisfaction with an aim to improving working
conditions for employees and organizational effectiveness
for employers.
Richard Walton’s article in the Davis and Cherns
collection on this subject proposed eight conceptual
categories relating to the quality of working life, these
being adequate and fair compensation, safe and healthy
working conditions, immediate opportunity to use and
Special issue
develop human capabilities, opportunity for continued
growth and security, social integration in the work
organization, constitutionalism in the work organization
(right to privacy, free speech and equitable treatment
and due process, work and total life space, social
relevance of work life
The Benefits of QWL Initiative
Employees trust that with the presence of QWL initiatives
they feel safe, relatively well satisfied and able to grow
and thus can develop as human beings. They believe
that QWL enhances their dignity through job satisfaction
and humanizing work by assigning meaningful jobs,
ensuring job security, making provisions for adequate
pay and benefits, providing safe and healthy working
conditions, giving opportunities to develop human
capacity, ensuring growth and security, social integration,
constitutionalism, getting freedom to self-expression and
thus, help to increase individual productivity that supports
to achieve organizational effectiveness. That’s why Casio
(1992) aptly defines QWL “in terms of employees’
perceptions of their physical and mental well-being”.
QWL initiatives are equally beneficial for the employees.
QWL positively nurtures a more flexible, loyal, and
motivated workforce, which is essential in determining
the company’s competitiveness leadership. Positive
results of QWL reduced absenteeism, lower turnover,
and improved job satisfaction Largely, it appears that
the main concerns of an effective QWL program are
improved working conditions mainly from an employee’s
perspective and greater organizational effectiveness
mainly from an employer’s perspective Predicting or
studying QWL variables depends on approaches adopted
to improve QWL situation at the organizational level.
Approaches to Quality of Work Life
Three different approaches regarding QWL are common
in the literature of human resource management (Krahn
and Lowe, 1998; Crompton and Harris, 1998; Gallie,
1990; Rose, 1994). In the era of scientific management,
QWL was based on extrinsic traits of jobs: salaries,
safety and hygiene, and other tangible benefits of the
workplace. The human relations approach stressed that,
while extrinsic rewards are important, intrinsic traits of
job: autonomy, challenges and task contents, are key
predictors of productivity and efficiency. A third approachorientation to work-suggested that a focus on extrinsic
or intrinsic reward is contingent on the person. However,
the success of QWL initiatives depends on openness
and trust, information management, organizational
culture, partnership between management and workers
(Casio, 1992). Equally important, responsibility of
improving QWL is concerned, it should be jointly shared
by employees, owners, union leaders and governments
through legislations. The role of these stakeholders is
November 2015
Page 219
most vital in protecting rights and interests of the workers
and employees. Very few authors have mentioned about
the role of the state in protection of QWL rights at the
time of liberalization and globalization. Although with the
increasing impact of liberalization and deregulation of
economy, organizations in developed and developing are
demanding for more autonomy in labor related decisions,
provisions and mechanism of implementing QWL
initiatives should come from the labor laws.
In 1999 International Labor Organization (ILO) put forward
a new agenda of “decent work” defined as decent work
deficits caused by a gap between the world that we work
and in and the hopes that people have for a better life
(ILO, 2001) in order “to improve the situation of human
beings in the world of work (ILO, 1993, 3). From the
perspective of decent work, the “gaps” which exist
between people’s aspirations regarding their work and
their current work situations can be viewed as “decent
work deficits”. Although ‘decent work’ movement is
recently development concept that is different from the
QWL initiatives it has not left the main issue of labor
rights problem arising due to the gap in the aspirations
and real work situation at our workplaces. In other words,
the issues of QWL are also considered while framing
“decent work” concept.
Human resource departments are involved with efforts
to improve productivity through changes in employee
relations. QWL means having good supervision, good
working conditions, good pay and benefits and an
interesting, challenging and rewarding job. High QWL is
sought through an employee relations philosophy that
encourages the use of QWL efforts, which are systematic
attempts by an organization to give workers greater
opportunities to affect their jobs and their contributions
to the organization’s overall effectiveness. That is,
proactive human resource department finds ways to
empower employees so that they draw on their “brains
and wits,” usually by getting the employees more involved
in the decision-making process.
According to Harrison, “Quality of Work Life (QWL) is
the degree to which work in an organization contributes
to material and psychological well being of its members.”
Hackman and Oldham (1976) (5) drew attention to what
they described as psychological growth needs as
relevant to the consideration of Quality of working life.
Several such needs were identified; Skill variety, Task
Identity, Task significance, Autonomy and Feedback.
They suggested that such needs have to be addressed
if employees are to experience high quality of working
life.
Taylor (1979)(6) more pragmatically identified the
essential components of Quality of working life as; basic
extrinsic job factors of wages, hours and working
conditions, and the intrinsic job notions of the nature of
Special issue
the work itself. He suggested that a number of other
aspects could be added, including; individual power,
employee participation in the management, fairness and
equity, social support, use of one’s present skills, self
development, a meaningful future at work, social
relevance of the work or product, effect on extra work
activities. Taylor suggested that relevant Quality of
working life concepts may vary according to organization
and employee group.
Warr and colleagues (1979)(7), in an investigation of
Quality of working life, considered a range of apparently
relevant factors, including work involvement, intrinsic job
motivation, higher order need strength, perceived intrinsic
job characteristics, job satisfaction, life satisfaction,
happiness, and self-rated anxiety. They discussed a
range of correlations derived from their work, such as
those between work involvement and job satisfaction,
intrinsic job motivation and job satisfaction, and perceived
intrinsic job characteristics and job satisfaction. In
particular, Warr et al. found evidence for a moderate
association between total job satisfaction and total life
satisfaction and happiness, with a less strong, but
significant association with self-rated anxiety.
Thus, whilst some authors have emphasized the
workplace aspects in Quality of working life, others have
identified the relevance of personality factors,
psychological well being, and broader concepts of
happiness and life satisfaction. Factors more obviously
and directly affecting work has, however, served as the
main focus of attention, as researchers have tried to
tease out the important influences on Quality of working
life in the workplace.
Lawler (1982) defines QWL in terms of job characteristics
and work conditions. He highlights that the core dimension
of the entire QWL in the organization is to improve
employees’ well being and productivity. The most
common interaction that relates to improvement of
employees’ well-being and productivity is the design of
the job. Job design that is able to provide higher employee
satisfaction is expected to be more productive. However,
he accepted the fact that QWL is complex, because it
comprises physical and mental well being of employees.
Loscocco and Roschelle (1991) suggest that there are
two dominant theoretical approaches in the QWL
literature, namely need satisfaction and spillover. In the
original report to be reported in a later chapter of the
research report, QWL will be based on these two
theoretical perspectives.
QWL is important as there is evidence showing that a
happy employee is a productive, dedicated and loyal
employee (Greenhaus et al., 1987). Research by Danna
and Griffin (1999) shows that, the consequences of low
levels of health and well-being includes absenteeism,
reduced productivity and efficiency, reduced service
November 2015
Page 220
quality, etc. Therefore, it can be argued that QWL may
have a significant impact on employee behaviour, such
as job satisfaction, performance, intention to quit, and
turnover, to name a few.
In the same Heskett, Sasser and Schlesinger (1997)
define QWL as the feelings that employees have towards
their jobs, colleagues and organizations that ignite a
chain leading to the organizations’ growth and
profitability. A good feeling towards their job means the
employees feel happy doing work which will lead to a
productive work environment. This definition provides an
insight that the satisfying work environment is
considered to provide better QWL.
There is no formal definition of quality of work life (QWL),
industrial psychologists and management scholars agree
in general that QWL is a construct that deals with the
well-being of employees (Danna and Griffin, 1999). One
might argue at this point that QWL is the same as job
satisfaction, however it has been stated that QWL differs
from job satisfaction in that job satisfaction is construed
as one of the many outcomes of QWL (Greenhaus,
Bedian and Mossholder, 1987). It was also stated that
QWL does not only affect job satisfaction but also
satisfaction in other life domains such as family life,
leisure life, social life, financial life and so on. Therefore,
there is evidence to say that the focus of QWL goes
beyond job satisfaction by encompassing the effect in
non-work life domains, and satisfaction with overall life,
personal happiness, and subjective well-being.
Human resource departments are involved with efforts
to improve productivity through changes in employee
relations. QWL means having good supervision, good
working conditions, good pay and benefits and an
interesting, challenging and rewarding job. High QWL is
sought through an employee relations philosophy that
to the organization’s overall effectiveness. That is, a
in the decision-making process. Human resource
departments are involved with efforts to improve
productivity through changes in employee relations. QWL
means having good supervision, good working
conditions, good pay and benefits and an interesting,
challenging and rewarding job. High QWL is sought
through an employee relations philosophy that
Special issue
to the organization’s overall effectiveness. That is, a
in the decision-making process.
According to Guna Seelan Rethinam, Maimunah QWL
is a multi-dimensional construct, made up of a number
of interrelated factors that need careful consideration to
conceptualize and measure. It is associated with job
satisfaction, job involvement, motivation, productivity,
health, safety and well-being, job security, competence
development and balance between work and non work
life.
To summarize, QWL is viewed as a wide-ranging
concept, which includes adequate and fair remuneration,
safe and healthy working conditions and social integration
in the work organization that enables an individual to
develop and use all his or her capacities. Most of the
definitions aim at achieving the effective work environment
that meets with the organizational and personal needs
and values that promote health, well being, job security,
job satisfaction, competency development and balance
between work and non-work life. The definitions also
emphasize the good feeling perceived from the interaction
between the individuals and the work environment.
The type of research design used in the project was
Case Study based Descriptive research. The population
consisted of the employees working in the M G Road
branch of IIFL, M G Road branch, Ernakulam. The
sample consists of the 50 employees working at IIFL.
The Sampling frame consists of the list of all 50
employees working at IIFL, M G Road branch,
Ernakulam. The sampling units were the employees of
IIFL, M G Road, Ernakulam. Census survey was used
for the study which covers all the employees of IIFL, M
G Road, Ernakulam.
The data was collected using a structured questionnaire.
Questionnaire consisted of questions to capture the
demographic details of the respondents and questions
with 5 point likert scale to capture the perception of the
respondents.
Both the Primary and Secondary data collection method
were used in the project. Primary data was collected by
means of a Structured Questionnaire, and used for the
analysis. Secondary source was mainly used for
theoretical background and literature review.
Categorization was done based on the demographic data.
Mean perception score for different questions was
calculated.
November 2015
Page 221
Data Analysis, Findings and Interpretation
Demographic Categorization
Age wise classification
50% of the respondents come under the age group of
30-40 and 46% comes in between 20-30. 4%
respondents were in 40-50 age groups.
Gender wise classification
56% were males and 44% were females.
Income wise classification
4 % respondents had monthly salary below 10000, 84%
respondents had in the range 10000-30000, 4 % of the
respondents had in the range 30000- 40000, and 4% of
the respondents were having salary above 40000.
Mean Perception Scores
The following table shows the item wise mean perception
scores.
Table 5 4 Item wise Mean Perception Scores
Table - 1
Item
Mean
My job requires learning new things.
4.24
The job often demands to use my skills
and abilities
4.18
The working conditions of job allows to be
more productive
4.20
I receive enough help and equipment to get
the job done
4.18
In job, I often take part with superiors in
making decisions
4.08
The suggestions given by me are always
accepted by the superior
4.04
The safety of workers is a high priority for
the management
4.02
Employees and management work
together to ensure the safest possible
working conditions
4.14
The organization is run in a smooth and
effective manner
4.20
I have enough freedom to decide how to do
my work
4.10
The career progression followed in this
organization is at par with that of the
industry
3.80
Compensation paid in this organization is
commensurate to the responsibilities
shouldered
3.72
I can give full attention to my work
4.12
I welcome challenging assignments
4.02
The mean perception scores for all the items are above
3.0, which shows that the quality of work life of the
employees of India Info line, Kochi is generally good.
Suggestions
The mean perception for all the items that measure
perception is above 3.00. this implies that the quality of
work life prevailing in the organization is good. However,
the following points can be considered:
The management can reinforce the support extended to
its employees for maintaining a good working
environment so as to keep the employees motivated and
productive.
The management can periodically benchmark its HR
practices pertaining to quality of work life and make any
changes as required to keep up with other organizations
in the industry. This will help the management to reduce
turnover.
The employees generally feel that new learning is required
for their job. This is particularly important for the
organization since it is a financial organization and it
needs to keep pace with the industry and technology.
The management can impart training on the changes in
the industry and technology so as to equip the
employees to meet the changing needs of the industry.
Employees have stated that they welcome challenging
assignments. So, to stimulate the intellect of the
employees, management can introduce incentives for
continual improvements in work, outsource routine works
and entrust the employees with higher job responsibilities
that offer challenge to the employees.
The employees have stated that they are involved in the
decision making process and are given freedom to decide
on their way of work. This means that they are
empowered. The management can continue to involve
the employees in taking strategic decisions which will
increase the morale of employees and make them more
engaged with the organization.
The management also takes care of the well being of
the employees by ensuring safe working conditions. The
management can, however, go a step ahead and
introduce health schemes which will motivate the
employees to stay with the organization. The
management can also consider providing the employees
with a flat-panel liquid crystal display (LCD), like those
on laptop computers which it reduces the strain on eyes.
There is a difference among the income groups in the
perception that the compensation is commensurate with
the responsibilities shouldered. The persons with
monthly income less than Rs. 10,000 have disagreed to
the statement with a mean score of 2.00. The
management should take steps to identify the cause of
such a perception and make necessary changes in the
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November 2015
Page 222
compensation structure in tune to the industry
standards. This will motivate the employees to stay with
the organization.
Conclusion
The result of this study shows that there is a high level
of satisfaction among the employees regarding the
Quality of Work life. The factors determining the
satisfaction with the quality of work life in the
organization were “Adequate Income & Fair
Compensation, Safe & healthy working conditions ,
Opportunities to use & develop human capacity,
Opportunity for career growth, all these factors are
positively correlated with the quality of work life in IIFL.
In this study the primary objective is that to gain an
insight into the quality of work life in IIFL. The analysis
and findings shows that the organization is having a good
Quality of Work Life.
The secondary objectives is also satisfied that the
components of Quality of Work Life like compensation
and safety, employee consideration in decision making
is also maintained in IIFL. The participation of employees
in decision making, and the employee’s career
development through new learning was also achieved
by the firm. The working condition, safety, and
participation of the employees in decision making, all
these factors improve Quality of work life in IIFL. Overall
the quality of work life of India Infoline is good.
Bibliography
Antle, Beverley, J., 2006, OASW Quality of Work Life
Survey, final report of Ontario Association of Social
Workers
Bowditch, James L. and Anthony F. Buono, 2005, A
Primer on Organizational Behavior, John Wiley and Son,
Inc. Hoboken, New Jersey
Dr. Gupta Meenakshi, Factor Credentials Boosting
Quality Of Work Life of BSNL Employees In Jammu
Region, Asia Pacific Journal of Research in Business
Management, Year : 2011, Volume : 2, Issue : 1, pp: 79
- 89, Print ISSN : 2229-4104.
Jazani, Nasrin, 1996, Human resource management, 1st
edition, Tehran, Ney publication.
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Markham, Lyle Grant, 2010, Quality of work life as
predictor of employees’ mental health, In fulfilment of
the requirements for the degree Magister Artium in the
Faculty of Humanities, Department of Industrial
Psychology
Myanard Riveral Bagtosos, Quality of Work Life: A
Review of Literature, DLSU Business and Economics
Review, Volume 20, Issue No. 2 (2011), Article No. 26
Orpen, C., 1981, The conceptualization of quality of
working life, Perspectives in Industrial Psychology, 7,
36- 69.
Rethinam, Guna Seelan, Maimunah, 2008, Constructs
of Quality of Work Life: A Perspective of Information and
Technology Professionals, European Journal of Social
Sciences – Vol. 7, No. 1, PP: 58-70.
Rice, R. W., 1985, Organizational Work and the
Perceived Quality of Life towards a Conceptual Model,
Academy of Management Review, April, Col. 10(2), pp
296-310.
Robbins, S., Millett, B., Caiocoppe, R. and WatersMarsh, T. (1998). Organizational Behaviour.
S. Jain, Quality of Work life
Rose, R., Beh, L., Uli, J., & Idris, K., 2006, An analysis
of quality of work life and career related variables.
American Journal of Applied Sciences, 3(2), 2151-2159.
Saraji, G Nasl, Dargahi, H, 2006, Study of Quality of
Work Life (QWL), Iranian Journal of Public Health, Vol.
35, No. 4, pp.8-14.
Subrahmanian, Mu, Anjani, N., 2010, Constructs of
Quality of Work Life– A Perspective of Textile and
Engineering Employees, Asian journal of management
research, 299-307.
T S Nanjundeswaraswamy , Dr Swamy D R., A literature
review on quality of work life and leadership styles,
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Walton, Richard, E., 1974, Improving the quality of work
life, Harvard Business Review.
November 2015
Page 223
STRATEGIC STUDY ON CONTENT ANALYSIS OF LIBRARY WEBSITES
WITH SPECIAL REFERENCE TO CENTRAL
UNIVERSITIES IN SOUTH INDIA
Sariga T. R.1
Lakshmi T R2
Abstract
This study is carried out to analyze the content of library websites of central universities in South India. The major
objective of the study was to find out whether the libraries have a direct link to their electronic resources on their
WebPages, to know about the accuracy, currency, accessibility, and user friendliness and to determine the library
services and facilities offered through library websites. There are six websites of central university in South India are
selected for the study. A checklist was developed as the main tool for data collection and Microsoft Excel was used as
the tool for data analysis. The study shows that majority of the central university library website provide the information
about mission statement, working hours, contact information, staff directory, copy right. A good number of libraries
have their websites with the details of newspapers, dissertations. A few library website indicate the information about
DDS, reprographic services, reservation, browsing facility for visually challenged, and exhibition. The study indicates
that the usage of web 2.0 technology is very less in library website.
Key words: central University, library websites, South India.
Introduction
Information technology is rapidly changing the whole
world creating new challenges and opportunities. As
libraries move forward in to the digital age, our web
presence has become increasingly important to meet
the needs of our users. Libraries are using web
environment to provide high quality information for their
users mostly in digital format. Libraries have always tried
to use the most recent available technologies for
information collection and preservation and adopted
websites in this era of technology boom. Recent years
have seen the emergence of websites as an ideal medium
through which knowledge and information can be
disseminated very effectively to every nook and corners
of the world. (Shukla, 2010). Library website requires an
interface that can accommodate the different needs,
scholarly disciplines and capabilities of a number and
varied users and it should be the best combination of
properly managed resources and the users Need.
Website is considered as the most popular medium to
catch the recent updates therefore, every institution have
its own website that is used for imparting valuable
information to the targeted users.
Literature Review
Literature review gives an overview of the studies done
previously and published by the various authors in the
journals both in hard as well as soft copies. Baka and
Nur (2015) made a web metric study of world class
universities websites. The objective of the study was to
determine, whether there are difference in terms of
visibility and accessibility of the top rank and the bottom
rank universities websites. There are 30 samples were
drawn from the top rank and the bottom rank universities
based on the times higher education world university
rankings (2013). In this study Alexia is used to study
the visibility of the universities websites. Eval access
software was used to analysis the selected websites.
This study concluded that those top rank universities
websites are more visible and accessible as compared
to the other websites. Jange (2014) conducted an
evaluative study on the library websites of universities of
Karnataka state. The objectives of the study were to
determine the basic information about the library
pertaining to books, journals and other information
services, to determine the type of information content,
to evaluate the performance of the library websites with
respect to performance grading and load time of website
and to understand whether the library website makes
provision for searching information. The study attempts
to evaluate the library websites of universities of
Karnataka comprising of 16 General State Universities
including a Central University and 8 subject based
universities of Karnataka state. The major findings of
the study were that only library of Agricultural Science
library, Dharwad provided search facility to search the
information within its website; performance grading of
library websites has been found to be high in Mysore
University library and none of the university library
websites under study had made use of any web2.0 on
their websites.
1
. PG (MLISc), Department of library and information science, Kannur University, Thalassery .
. Librarian , Sree Narayana Gurukulam College of Engineering, Kadayiruppu, Kolenchery
2
Special issue
November 2015
Page 224
The study aims to determine the information content on the library websites of central universities in Kerala,
Karnataka, Tamil Nadu, Pondicherry, Telangana.
• To identify the content and coverage of the study.
• To find out whether the libraries have a direct link to their electronic resources on their WebPages.
• To know about the accuracy, currency, accessibility, and user friendliness.
• To determine the library services and facilities offered through library websites.
Scope and limitations of the study
The scope of the study lies in the fact that library is the heart of any university that recognizes the intellectual life
and scholarship of academia and researchers. The study attempts to evaluate the contents of library websites of
Central Universities in South India and its contribution to the global knowledge base. The result of this study will
help to illustrate the overall content, coverage and the features of library websites in Indian universities.
The present study limited to central universities in south India. There are 8 central universities in South India. One
central university of Tamil Nadu and Telangana do not have library website. Therefore, this study examined the
websites of 6 central universities in South India. More over time also found limited as number of sites is move, so
that the content also limited to general information, collection and services. But the investigator has made an
attempt to make the study as precise and objectives as possible with provided time.
Methodology
For the present study the investigator developed a check list for the evaluation of website in consultation with in the
supervising teacher for the analysis of the website. In preparation the checklist similar studies were consulted as a
first step. Different websites was observed and related literature are analysed.
The investigator selected 6 university library websites for the study on the basis of content available on the websites.
The checklist included general information, information about library collection, information on e-resources, information
about library services, and linking pattern for e-resources. This checklist was used to record the features present on
each website. It was extended, as necessary, as new features were noted on WebPages accessed for the study.
The data collection was done at April 2015 for further analysis.
Analysis and Interpretation of Data
General Information
The library portal of any institution has to provide general information about library regarding about library, library
objectives, area and site plan, contact information, date of update, FAQs, library automation, library committee and
other information, library staff, membership information, news and events, working hours, suggestions and feedback
sections. It also should include authority, copyright, domain name, of the site. General information available in
central university library website are shown below table 1
General information
CUK
CUKE
IGML
MANUU
ARL
CUT
About library
Y
Y
Y
Y
Y
Y
Mission statement
Y
Y
Y
Y
Y
N
Site map
N
N
Y
Y
Y
N
Working hours/Holidays
Y
Y
Y
Y
Y
N
Library rules
Y
Y
Y
Y
Y
Y
Membership
Y
Y
Y
N
Y
Y
Administrative activates
N
N
Y
Y
N
N
News and events
Y
Y
Y
N
Y
N
Contact information
Y
Y
Y
Y
Y
N
Staff directory
Y
Y
Y
Y
Y
N
Special issue
November 2015
Page 225
Website in other languages
N
N
N
N
N
Y
Visitors list
Y
N
N
N
Y
N
Gallery
Y
Y
N
Y
Y
Y
FAQ
N
N
N
Y
Y
N
Date of update
N
N
Y
Y
Y
N
Feedback
N
Y
N
Y
Y
N
Copyright
Y
N
Y
Y
Y
Y
Future plan
Y
Y
N
Y
N
N
IT Infrastructure
Y
N
Y
N
Y
N
ac.in
ac.in
ac.in
ac.in
edu.in
ac.in
Domain
Table 1General Information available in central university library websites in South India
CUK=Central University of Karnataka, CUKE= Central University of Kerala, IGML=Indira Gandi Memorial Library,
MANUU= Maulana Azad National Urdu University, ARL= Ananda Rangapilli Library, CUT= Central University of
Tamil Nadu, Y=Yes & N=No
From the table it is found that the websites of CUK, CUKE, IGML, MANUU, ARL, CUT provide the information about
library. The library website that inform as about the mission statement of their library are CUK, CUKE, IGML,
MANUU, and ARL where, as CUT does not give any information about it. Library website of IGML, MANUU, and ARL
include the location information. The entire library website provides the information about working hours/holidays
except CUT library website. It is a good sign that most of the central universities in South India provide the information
about library rules and membership details. News and events provide the information about the activity of the library,
events that have take place or upcoming events are mentioned in the library websites. CUK, CUKE, IGML and ARL
contain the information about news and events. The websites of CUK, CUKE, IGML, MANUU, and ARL contains the
details about contact information, staff director. The copyright details are viewed in the websites of CUK, IGML,
MANUU, ARL and CUT. The library websites of CUK and ARL provide the information about visitors list. The update
dates are given by only IGML.MANUU and ARL library website.
The domain name of CUK, CUKE, IGML, and MANUU are 'ac.in' where as that of ARL are 'edu.in'. Only CUT library
website provides information in other languages than English. Feedback facility is provided by the websites of
CUKE, MANUU, and ARL library. From the study it is revealed that majority of library websites provide the information
about library, library rules, membership. Information such as FAQ, administrative activities is less in number. The
graphical representation of general information’s is shown in below.
Figure - 1 : General Information Available In Central University Library Websites In South India
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November 2015
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Information about E- Resources
To be effective the library website must include electronic resources including e-journals, databases, e-books, epatent, e-theses, online newspapers and institutional repository. it is revealed that a good number of library provide
the link to their electronic resources. The details of the E-Resources available on the six websites of central
universities of South India under study are shown in the following Table 2
Table - 2 : E-Resources Available In Central University Library Websites In South India
E-Resources
CUK
CUKE
IGML
MANUU
ARL
CUT
E-Books
Y
Y
Y
Y
Y
N
E-Journals
Y
Y
Y
Y
Y
Y
E-Databases
N
N
Y
Y
Y
N
E-Theses
N
Y
N
N
Y
N
E-Patents
N
N
N
N
Y
N
Online newspapers
N
N
Y
N
Y
N
Institutional repositories
Y
N
N
N
Y
N
Useful links
Y
Y
Y
Y
Y
N
On trial access
Y
N
Y
N
Y
N
From the table it is clear that the Information about e-books and e-journals provided by all the library websites. The
lists of e-journals are provided by websites of ARL, CUKE and IGML library. Online newspaper facility was provided
by IGML and ARL library websites.CUK and ARL have their own institutional repository on their library homepage.
Out of six provided the details of e-these i.e., CUKE and ARL library website. The entire library website provides
useful links to other information sources except CUT. Majority of the library websites contains the information about
e-books and e-journals. Few number of libraries provide e-these and e- patents. Graphical representations of Eresources are shown below.
Figure - 2 : E-Resources available in central university library websites in South India
Application of Web 2.0 Technology
The applications of Web 2.0 technologies in library websites have great importance as these increases the interactivity
with the audience. The investigators assessed the extent of use of Web 2.0 technologies in the central university
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November 2015
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websites in South India. In Table 3 and Figure 3 shows the use of Web 2.0 technologies such as Blogs, RSS, Atom,
and so on.
Table - 3 : Application of Web 2.0 Technology in central university library websites in South India
Web 2.0
CUK
CUKE
IGML
MANUU
ARL
CUT
RSS
N
N
N
N
N
N
Atoms
N
N
N
N
N
N
Blogs
N
Y
Y
N
N
N
From the table it is revealed that information about blogs is available in CUKE and IGML library websites. RSS and
atoms are not available in library websites. Graphical representations of web 2.0 technology are shown below.
Fig. 3
Application of Web 2.0 Technology available in central university library websites in South India
Findings
Following are the major findings of the study,
1. The studies revealed that all the university library websites in South India have the information about library, its
rules, membership,. The result of the study clearly show that majority of the central university library website
provide the information about mission statement, working hours, contact information, staff directory, copy right.
Whereas only few library website provide the information on site map, date of update, future plan. A few websites
provide opportunity for user interaction in the form of feedback. Some of the library website indicates the information
about FAQ, administrative activities. Only CUT library website provides the information on provision of website in
other language.
2. All the libraries present their collection on their websites. Majority of the websites provide detailed information in
their collection like book and journals .Some of the library website provide the information on magazines. A good
number of libraries have their websites with the details of newspapers, dissertations. A few of the websites
provide information about CDs/DVDs, new arrivals, back volume and question papers. Only IGML library website
provides the information about Project reports and annual reports.
3. The findings clearly inform that all the library website provide the information about the services of the library.
Entire central university library website provide web OPAC facility. Majority of the library provide details of the
circulation service. A good number of library provide the information on reference services and inter library loan.
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November 2015
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A few library website indicate the information about
DDS, reprographic services, reservation, browsing
facility for visually challenged, and exhibition. Only
MANUU provide the information about bibliographic
services.
4. Majority of the library access e-resources on their
library websites like e-books and e-journals. From
this study it's clear that many of the central university
website provide useful links to other e-resources. A
good number of the library websites indicates
information on e-databases and on trial access of eresources. It is clear that only a few library website
provide the details of online newspapers, institutional
repositories and e-these. Only ARL library website
provide the information about e-patents.
5. Libraries adopt Web 2.0 applications focusing on the
users which emphasize the user-centered attitude.
It is revealed that only two libraries use web 2.0
technology that are blog. CUKE and IGML library
use blogs.
Suggestions for Improvement
Based on the findings of the study, in this section
investigator has been made to suggest a few
recommendations, which will help to creator or designer
of the website to make library website more interactive,
attractive and workable. It will also be helpful to the user
of the library website to evaluate its content, quality of
information, design, structure, and organization of
information. The present study made the following
recommendations for improvement of library websites.
1. Majority of library websites have not mentioned the
'date of update' in their website. Date of update show
the currency of information available on the websites.
So it is necessary to provide the date of update on
the website.
2. Majority of the library websites not mentioned
information about library services like CAS,
references, DDS. It is recommended to facilitate
above mentioned services.
3. Few library website provides the provision for viewing
website in other languages. Providing facility for
changing the languages will increase the user
response.
4. The study indicate that the usage of web 2.0
technology is very less in library website.The websites
should provide the collaborative forum for discussion
and sharing of information for library users. The central
university library websites should exploit the
emerging internet technologies to attract and increase
its users. Use of application like RSS and atom will
help to increases the usage of websites.
Special issue
5. Usage of FAQ is less in central library websites.
Providing those informations will be very helpful to
the users.\
Suggestions for further study
1. A comparative study can be carried out to analyze
the content of central university websites in South
India and North India.
2. The content analysis of central universities websites
can be done in national level.
3. The recent trends exploring in the library website are
web 2.0 applications. Further studies can be carried
out on that area.
Conclusion
The study gives an informative preview of the contents
of central university library websites in South India.
Although the libraries have a web presence and varying
levels of services, there is enormous scope of improving
the websites. Most of the library website not gives the
details of update. Library website should update regularly.
It enhances the use of library websites. The websites
should limit the links included in a text and should
provide links to as many documents as possible online.
The links should be clearly identified and point towards
the right destination. The websites should handle
multimedia documents through multimedia interfaces.
The websites should provide the collaborative forum for
discussion and sharing of information for library users.
The central university library websites should exploit the
emerging internet technologies to attract and increase
its users.
Reference
1. Shukla, Akhandanand and Tripathi, Aditya. (2010).
Establishing content for library websites: A case
study of Indian academic library websites. Annals
of Library and Information Studies, 57. 403-416.
2. Baka, Ahmad Bakeri Abu and Nur Leyni N.P.G.
(2015). Webometric study of world class univerisites
website. Qualitative and Quantitative methods in
libraries, 105-115
3. Jange, Suresh. (2014). Library websites of
Universities in Karnataka state: An evaluative study.
Journal of Advances in Library and Information
Science, 3(3), 195-202.
4. Manju Kataria and Bandana Pandey. (2014).
Coverpage of Indian Corporate Website: A content
analysis. EPRA International Journal of Economic
and Business Review, 2(10), 100-107.
5. Tafaroji, Roghaye and Tahamtan, Iman. (2014)
Webometric analysis of Iranian medical universities
according to visibility site and rich files. Webology,
11(1).
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6. Dahiya Ashish and Shelley, Duggal. (2013).
Comparatative analysis of the websites performance
of industry integrated HMIS central government
IHMS and State Government IHMS in India. Torisum
& Hospitality, 2(3), 1-8.
7. Kabir, S. Humayoon and Sreelekshmi, S. (2013).
Websites of Government science and technology
research institutions in Kerala: A content analysis
study. Libraries in the changing dimensions of digital
technology, New Delhi, B.R Publishing Corporation,
888-897.
Special issue
8. Pareek, Sarwesh and Gupta, Dinesh k. (2012).
Information about services and information resources
on website of selected libraries in Rajasthan: A study.
DESIDOC Journal of library and information
technology, 32(6), 499-508.
9. Pareek, Sarwesh and Gupta, Dinesh k. (2013).
Academic library website in Rajasthan: An analysis
of content. Library Philosophy and Practice, 1-22
10. Thanuskodi, S. (2012). A webometric analysis of
selected institute of national importance website of
India. International Journal of Library Science, 1(1),
13-18.
November 2015
Page 230
MANAGERIAL CHALLENGES AND INNOVATIONS IN
ENTREPRENEURSHIP
Indhra Vinod1
Abstract
The establishment and development of Small and Medium Enterprises is a resourceful input leading to the rapid
development of economic and social prospects. A motivated SME’s sector establishes a strong foundation to increase
the standard of living and reduce poverty. There must be a rigorous and continuous need to improve the factors that
furnish an affable entrepreneurial climate to exceed major obstacles. Maintaining technology, business and knowledge
as buzzwords, the rapid advancements in the streams of science and technology are leading towards Knowledge
Entrepreneurs and Technology Driven Enterprises. The social and economic indicators has influenced in the abrupt
development of Indian economy setting a bright future in country’s education and GDP statistics. Knowledge based
industries are likely to acquire maximum prominence facilitating support to SME by the government in the next
decade. The major essence is to focus Human Resource Development support with the establishment of appropriate
mechanisms towards Technology Business Incubators in the era of globalization.
Key words : Incubators, entrepreneurship, venture capital, globalization
Introduction
The establishment and nurturing of Small and Medium
Enterprises (SME’s) is a vital input in creating dynamic
market economies in the economic and social
development of transition countries. Entrepreneurs are
the key drivers and inhibitors of economic growth,
innovation, regional development and job creation. A
strong highly motivated SME’s sector provides a strong
foundation to increase standards of living and to reduce
poverty. Despite being recognized internationally the
importance of SME’s, they still face major challenges
in many especially in developing countries like India
today. The challenges of business startups, its survival
and growth are often substantial. The availability of
financial resources and lack of capacity to handle
complex business management issues as well as a
complicated and bureaucratic environment present major
obstacles. As a result, there is an urgent and continuous
need to improve the different factors that make up a good
entrepreneurial climate.
In order to establish strategic plans for small and
medium enterprise development, it has been necessary
to establish some business development sectors to
bridge the gap between private and public sectors, since
private sector development relies on a partnership
between the private and public sectors. Since, Business
and Technology go hand in hand and hence they can be
separated. Technology, Business and knowledge are
becoming the buzzwords of the new millennium. As the
technology is leapfrogging for beyond the expected,
enormous activities are in progress in research and
development for new and newer technologies day by day,
resulting into the emergence of new areas of technology.
These rapid developments in the field of science and
technology are also leading towards a new class of
knowledge entrepreneurs and knowledge/technology
driven enterprises, which important factor for the
economic development of nations and a source of valueadded employment generation. At the same time, the
process of globalization, establishment of World Trade
Organization, high quality standards and environmental
considerations, imposition of trade barriers by developed
countries, information technology revolution continues
to adversely affect the conventional/traditional competitive
advantage of the small and medium enterprises in the
developing countries and a threat for survival in the
marketplace.
Indian Economic Picture
India has made considerable achievements during its
sixty years of independence. Economic reform and
liberalization measures over the last decade have led to
strong economic growth, increased exports, reduced
inflation and a positive impact on social indicators. Today,
India is the fifth largest economy and second most
popular country in the world. Indian Economy has
significantly grown in the recent years. Both social and
economic indicators have reflected their respective
positive impact for the development of the Economy. In
the Social sector the best example today is 108 million
children attend primary schools in India by making the
country’s education system the second largest in the
world after China. In the economic sector Gross
1
. Assistant Professor, Department of Business Administration, Alpha Arts And Science College, Porur, Chennai
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Domestic Product (GDP) in nominal terms of US$692
billion in 2004, has made the country the world’s tenth
largest economy. Real GDP grew by 6.9 percent in
2004 – 05 compared to 8.5 percent a year earlier.
Prospects for real GDP growth for 2005 – 06 is 6.5 to 7
percent. External position of the economy is becoming
significantly stronger. Exports have grown, especially
exports of services, which grew by 105 percent in 2004
– 05. Growth in services has largely been fueled by the
information technology boom in which India is emerging
as a world leader and is helping in building a strong
economy.
the most important factor of industrial process. In the
SME sector, technology is mainly sought in the form of
processes and product know-how. The different sources
from which technology flows into the SME’s are
government institutions, local suppliers, foreign suppliers,
R&D institutions, industries etc. Recent studies on
sources of technology for SME’s have found that the
entrepreneurs obtained technological knowledge mainly
from local suppliers. Technology identification,
acquisition, transfer, adoption and up gradation are some
of key issues in relation to technology management
relevant to SME’s.
Future vision on Indian SME sector
In the present scenario dynamic world “change” is the
only permanent thing. The process of change has
accelerated in most recent years due to macroeconomic
transformation both in house as well globally. In the
present situation the two big global economic forces
which are competing for world attention are (a) the advent
of a new economy due to information and communication
technology and (b) due to globalization increased
instability and uncertainty. With the formation of WTO,
a new trade environment is emerging and a large number
of items are now under Open General License (OGL). In
the recent times there has been reduction in import
duties. These have thrown a challenge before the SME
sector which warranted them to be more competitive
and efficient to face the international competition
successfully. Further, consumer’s choice, preference
and their quality are varying a lot. To cope up with these
changes, the SME sector will have to undergo many
internal and external transformations.
Monitoring and Measuring SME’s:
Small Industries Development Organization (SIDO) under
Ministry of Industry formulates and monitors policies and
programs, provides business services, establishes
product-cum-production development centers for SME’s.
Small Industries Development Bank of India (SIDBI), a
special financial Institution offers long term credit facility
as well offers assistance in marketing and export
promotion to SME’s etc., like this many institutions and
organizations have offered assistance and advices and
at the same time measure and monitor for effective and
efficient functioning of SME’s.
Change in the technological requirement
The competitiveness of any economy depends on how
efficiently all the resources in the process of production
are utilized and how efficiently these are marketed,
hence the entire chain of production and marketing has
to be efficient. Many of the items produced in the smallscale sector are becoming redundant because of the
change in consumers choice, preferences and also due
to change in new technology. The entry of foreign
products/services has given consumers a wide choice
of hi-tech and good quality products at competitive
prices. This means that the process of production has
to be cost efficient and meet quality needs of the
consumers. This improvement can come through the
use of latest technology. Hence, the need for change in
technology is more relevant for SME’s than large units.
Glance At Entrepreneurship Development in India
Entrepreneurship is a global and multifaceted phenomenon
with significant difference between countries. It has
positive relationship between entrepreneurship and
economic growth that contribute towards the wealth and
social development of a nation under the given
technological, industrial and political framework. The
government support for the small firm sector like funding
infrastructure and protection from competition has been
withdrawn. Social and cultural norms in India favor
stability and security. Capital investment, particularly
for early stage development, is a major hurdle faced by
most of the entrepreneurs in India. Growth is hampered
due to the scarcity working capital; financial institutions
do not appreciate the specific nature of entrepreneur’s
needs. The infrastructure in the country is better but
inadequate, as is the supply of professional and
commercial services. There is a short fall in skill-based
learning and the principles of the market economy in
education. While government agencies and educational
institutions carry out quality research and development,
there is little focus on the commercial aspects of
business. Industry investment in research and
development is low.
Sourcing of technology
Products, processes, designs, machinery, tools, testing,
equipment, technical training, consultancy, up gradation,
etc. which depend on technology is considered one of
Dominating And Influential Forces To Nurture
Techno-Entrepreneurship
In India, the Government has identified the need to
support and nurture entrepreneurship through successful
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November 2015
Page 232
methodologies used world over but adapted those which
suit local environment and conditions. Among them some
of them are discussed below.
National Science and Technology Entrepreneurship
Development Board (NSTEDB)
NSTEDB, established by the Government of India in
1982, is the nodal government agency promoting various
mechanisms to promote gainful self-employment in the
country and to link idle S&T manpower with the underutilized institutional credit facilities. The Board is being
serviced by a government organization named
Department of Science and technology (DST) with major
objectives being;
• Promoting and developing entrepreneurship through
the use of S&T.
• Facilitating various informational services relating to
entrepreneurship development.
• Networking central, state government agencies and
NGO’s in entrepreneurship and self-employment
development.
• As an advisory body to the Government agencies in
regarding entrepreneurship.
Science and Technology Entrepreneurs Park (STEP) The Science Park and similar initiatives in the developed
countries are the latest in the evolutionary line to create
an atmosphere for innovation and entrepreneurship; for
active interaction between academics and industries;
for sharing ideas, knowledge, experience and facilities
for the development of new technologies and their rapid
transfer to the end user. STEP provides a reorientation
in approach to innovation and entrepreneurship involving
education, training, research, finance, management and
government. It has been promoted jointly by the DST,
state government, financial institutions and the host
institutions. The prime objectives of STEP’s are to:
• Link between universities, academic and R&D
institutions.
• Promote entrepreneurship among science and
technology persons.
• Provide R&D support to the small-scale industry.
• Promote innovation based enterprises
The NSTEDB, jointly with all India financial institutions,
has so far catalyzed 15 STEP’s in different parts India
which have promoted nearly 1000 units generating annual
turnover of about more than Rs.150 crores and
employment nearly 7,000 persons. More than 100 new
products and technologies have been developed by the
STEP’s promoted entrepreneurs. STEP has taken the
privilege in setting the TBI nomenclature to discuss social
and economic prospects. The following aspects are
Special issue
concentrated by STEP to accomplish the proceedings
of TBI.
Technology Business Incubation (TBI) Mechanisms
Various enabling factors crucial for the success of
incubating mechanisms in a country are R&D
expenditures, new technologies, R&D, Resources,
Technology, Production, Costs and Socio-economic
conditions. Startup entrepreneurs need various support
services like marketing, business facilitation, technical
expertise, resources for financing and business
management during their initial phase to enhance its
survival. Incubators provide a conducive atmosphere and
a range of critical support services and needed facilities
to nurture and support a start-up. Various mechanisms
like science parks, technology parks, innovation centers,
technology business incubators are being experimented
world over to catalyze growth of technology based new
enterprises. Some of the Indian experiments on
Technology Business incubation are presented below.
Technology Business Incubators (TBI):
A TBI helps in incubating knowledge-based start-ups into
commercially viable products/services by providing
specialized guidance, critical support services, innovative
financing and networking support within a conducive
environment.
World scenario on TBI
At present, there are around 3,000 incubators of various
types operational in the world. In the United States, there
are over 800 incubators including about 200 Internet
incubators. Europe has about 1,000 incubators including
300 incubators in Germany. Among the developing
countries, China leads with about 100 incubators. Among
the industrializing countries, Republic of Korea is reported
to have about 300 incubators. Earlier (1980s) incubators
were essentially offering affordable space and shared
facilities to carefully selected entrepreneurial groups.
Thereafter, the incubators started varying widely in key
respects such as objectives, sectoral focus, and
business modes, etc. In some countries the incubators
were set up for empowerment, while in others for
technology commercialization. In the 1990s, workspace
and shared facilities were supplemented with counselling,
skills enhancement and networking services to access
professional support and seed capital. With the
technological progress, the incubators are intended to
mobilize information and communication technology (ICT)
and provide a convergence of support, towards creating
knowledge-based ventures. An incubator combining
technology with business is a technology business
incubator. Virtual incubator or incubators without walls
have also emerged recently, which offers need-based
services by networking with the relevant agencies.
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Indian scenario on TBI:
The techno entrepreneurship initiative was started by
the Department of Science and Technology (DST) in 1985
through the establishment of Science and Technology
Entrepreneurship Parks (STEP’s). The concept revolved
around the creation of STEP in academic institutions /
research lab of excellence with an objective of opening
doors of self-employment for young Science and
Technology graduates. With the maturity of STEP’s in
changing economic scenario, the DST established TBIs
in the year 2000. Today there are more than 40 STEP’s
/ TBIs promoted by DST and in addition several other
ministry’s and private players have established TBIs
which today totals to 100.
The TBI’s are aimed at achieving the following
objectives:
• Enterprise and entrepreneurship development: An
appropriate tool for economic development by
promoting technology/knowledge-based businesses,
culture of technopreneurship and creation of value
added new jobs;
• Technology commercialization: To provide a platform
for speedy commercialization of the technologies
developed in the institutes to reach the end-users;
• To provide an interfacing and networking mechanism
between academic, R&D institutions, industries and
financial institutions;
• To provide value addition through its services provided
to its tenants as well as to the existing technology
dominated SMEs;
• To provide R&D for industry: It also enables small
industry to take up R&D activity and the technology
up gradation activities.
Working mechanism of TBI:
The various aspects in the successful operation of a TBI
are its location, preferably to a knowledge source with
some formal links. A well-structured business plan should
include the identified focus areas, a good management
team, plan for arrangement of financial resources
including cash inflow and outflow. It should provide a
sophisticated array of services and devise well-defined
tenant selection and exit mechanisms.
TBI mechanism for India
Experiences show that a single model does not exists
to all locations. Suitable models are being developed
keeping the local needs, climate and the objectives in
view. India being diversify in nature, a single and a uniform
model may not be suitable. For each local needs, different
models are worked out after examining the local
infrastructure availability and overall framework of
objectives to be achieved.
Special issue
TBI’s initially targeted academic institutions/R&D
institutions of excellence with areas of focus being
information technology, biotechnology, Materials
management, agriculture, design, instrumentation and
much more. The services rendered by TBI’s involve;
• Managing business and professional services
necessary for nurturing and supporting early stage
growth of technologies and technology-based
enterprises.
• Providing workspace, communication facilities,
phone, fax, Internet and other shared services
including secretarial assistance.
• Business skill development, Business planning and
development.
• Business management and networking with
stakeholders.
• Other specialized services like Design, R&D, testing,
legal, etc.
TBI is also expected to assist the start-up firms with
financial support such as venture capital, funding from
angel investors and other financing mechanisms and
equity participation.
Venture Capital funders in India
In India the impact of venture in the new enterprises are
low. The first origin of modern day venture capital in India
can be traced to the setting up of a Technology
Development Fund (TDF) in the year 1987-1988, through
the levy of a cess on all technology import payments. In
1988, Technology Development and Information
Company of India (TDICI) [presently known as ICICI
(Industrial Credit and Investment Corporation of India)
Ventures] and Gujarat Venture Finance Ltd, (GVFL) were
formed. In 1996, Stock Exchange Board of India (SEBI)
came out with guidelines for venture capital funds, which
paved the way for foreign venture funds to enter India.
Some of the Venture Capital funding currently in practice
includes; private equity funds; raising funds through
public; regional VC funds; Incubators. With the outburst
in IT boom, the Venture Capitals are focusing mainly on
biotechnology, telecommunication, entertainment,
education and new materials sectors, etc. At present,
there are more than 100 established VCs operating in
India at the national level as well at state level mainly
from the Government (financial institutions) and private
sector. The total pool of Indian venture capital today,
stands over Rs 50 billion.
Conclusion
In next 10 years, knowledge-based industries are likely
to acquire greater prominence and SME’s are likely to
come up in the industry. The role of the Government is
to facilitate support to SME’s in the era of globalization
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Page 234
and to focus on providing human resource development
prop up along with establishment of suitable support
mechanisms and nurture technology oriented
enterprises. Some Public and Private Banks and
Financial Institutionsalso support SME’s to greater
extend, even Government contributes various Monetary,
Tax benefit in promotion and success of Entrepreneur in
India
•
References
•
•
•
•
•
•
Small Industries Development Organization (SIDO)
under Ministry of Industry
Official Gazette of Government of India, Ministry of
Industry and Commerce
Small Industries Development Bank of India (SIDBI)
official Websites
Agrawal, S.P. “Strengthening Technology Incubation
System for Creating High Technology-based
Enterprises in Asia and the Pacific” 2001.
Bischoff, J. “An overview of successful international
technology business incubator programs”, paper
presented at the First International Workshop on
Technology Business Incubators in India, Bangalore,
29-31 January 2001.
Special issue
•
•
•
•
Gupta, A. and B.K. Jain “Technology business
incubators: Opportunities and challenges for India”,
Asia Pacific Tech Monitor, vol. 19, No. 4, July-August
2002.
Menon, P.K.B “Technology business incubation
systems In India”, paper presented at the First
International Workshop on Technology Business
Incubators in India, Bangalore, 29-31 January 2001.
NBIA, Proceedings of the National Business
Incubation Association’s 16th International
Conference on Business Incubation: Explore Your
World, Enrich Your Community, Toronto, 28 April – 1
May 2002.
Raetz, Gerhard “Technology incubation: An
instrument to support new enterprises”, Asia Pacific
TechMonitor, Jan-Feb 2001.
Global Entrepreneurship Monitor 2001 Executive
Report (London, GEM).
Woo-Geun Song “Report of the Regional Consultative
Meeting on Strengthening Technology Incubation
System for Creating High Technology-Based
Enterprises in Asia and the Pacific”, in Strengthening
Technology Incubation System for Creating High
Technology-based Enterprises in Asia and the Pacific
2001.
November 2015
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A STATE OF THE ART REVIEW ON SUPPLY CHAIN COLLABORATION
Shreejith T V
1
Kemthose P Paul
2
Abstract
Supply chain collaboration is certainly a most debated topic of the present market, but many supply chain managers
are unaware of what is the underlying concept of collaboration. For most of the firms, collaboration simply means an
exchange of ideas and information among partners – usually directed toward a specific opportunity or problem –
where members of the collaborating companies get together to share best practices, address concerns, and generate
solutions. In order to have an idea about how to make a collaboration decision effectively, it is necessary to acquire
a sense of what a strong collaboration arrangement encompasses. For the better understanding of which collaboration
arrangement is right for a given setting, it is important to understand the potential benefits of strong collaborations can
yield and measure those benefits against the potential risks of entering into such an alliance with a partner whose
interests may/may not be perfectly aligned with the partnering firm. In addition to this awareness on key factors that
nurture productive, collaborative arrangements will helps to take decisions to leverage or mitigate their effects. A lot
of academic and non academic research has begun to explore this issue. Through this work we have explored the
major concepts/strategies adopted by different authors to make the supply chain collaboration a success.
Key words: : Supply chain collaboration,CPFR, coordination
Introduction
Collaboration is the common thread in new wave of
supply chain business models. A number of analysts
are advocating on the need of supply chain collaboration
since last 5-10 years because of the severe competition
in the market and within the supply chain. Consumers
will drive the need for greater supply chain collaboration
over the next decade, according to a study by the
Consumer Goods Forum and Capgemini titled “Future
Value Chain 2020: Building Strategies for the New
Decade” [5].The report predicts that, over the next
decade, supplier production will be brought into line with
predicted and actual demands from consumers, rather
than based on the forecasting models used today. Future
products will be shipped to collaborative warehouses in
which multiple manufacturers store their products.
Competing firms will then collaborate to collect and
deliver the goods. They will be driven by demand for
carbon-efficient distribution and limited supply chain
capacity.
Supply chain collaboration can be defined as “two or
more chain members working together to create a
competitive advantage through sharing information,
making joint decisions, and sharing benefits which result
from greater profitability of satisfying end customer needs
than acting alone.”[1]. It involves information sharing and
process coordination to support joint planning, ordering,
and distribution among partners in a supply chain and
there are different levels of collaboration such as (1) Armlength relationships: - This type of collaboration schemes
will be often short-term in duration; nature of relation will
be contract-based and adversarial. (2)Cooperation: - In
this type collaboration there will be only a few suppliers
but there will be a longer term customer supplier
relationship. (3)Coordination: - This collaboration
scheme’s characteristics are firms’ information systems
are more strongly linked and there will be more emphasis
on strategy. (4)Collaboration: - In this scheme, the link
between companies in a supply chain setting is as
strong as it can be before joint venture or vertical
integration. This can again be classified into two types
such as - Type 1: Where companies working together in
logistics and manufacturing related activities in a supply
chain - Type 2: Where Strategic alliance bringing together
buyers and suppliers in separate industries or different
supply chain stages and creating a single system. World
class supply chains benefit in many ways from
collaboration - even in times of severe economic stress.
These benefits extend beyond improved efficiency and
effectiveness to include helping all the supply chain
members meet customer demands, grow markets, and
increase competitive market share. These advantages
are achieved in a number of innovative ways over the life
of the collaborative relationship — for example, by
increasing sales volume from downstream buyers,
lowering operational costs within the relationship, wordof-mouth referrals, and new product and process
innovations borne from the working relationship between
trusting partners [2].
Collaborative supply chain allows companies to create
highly responsive, demand-driven business networks that
solve today’s global supply and fulfilment challenges [21].
1
. Assistant Professor, Dept of Mechanical Engineering, Sree Narayana Gurukulam College of Engineering,
Kolenchery, Ernakulam
2
. HOD, Dept. of Management Studies, Sree Narayana Gurukulam College of Engineering, Kolenchery, Ernakulam
Special issue
November 2015
Page 236
There are enormous issues in the collaboration of supply
chain; since the information sharing between the partners
are being strategically critical.
Collaboration initiatives
Different initiatives are taking place in collaborating
different supply chains for the last few decades. They
are [31]
(1) Quick Response : - Quick Response (QR) is both
a management paradigm and a methodology that
allows supply systems to react quickly to changes
while improving their performance. QR aims to help
organize a business in the face of problems
associated with the vast array of goods and services
now to be found in consumer markets [36]. It is
particularly relevant to the Fast Moving Consumer
Goods (FMCG) and Fashion industries. QR works
by compressing the time between product or service
design concept and appearance on the retail shelf.
It then takes advantage of such recent technologies
as Point of Sale (PoS) tracking and Electronic Data
Interchange (EDI) to constantly up-date estimates
of true consumer demand, and then places intelligent
re-orders for goods with flexible manufacturers and
their suppliers [38].
(2) Vendor Managed Inventory (VMI): - Vendor
Managed Inventory or VMI is a process where the
vendor creates orders for their customers based on
demand information that they receive from the
customer. The vendor and customer are bound by
an agreement which determines inventory levels, fill
rates and costs [37]. Instead of the customer
reordering when its supply has been exhausted, the
supplier is responsible for replenishing and stocking
the customer at appropriate levels. Wal-Mart has
mastered VMI and is the company against which
many other organizations benchmark themselves.
Furthermore vendor representatives in a store benefit
the vendor by ensuring the product is properly
displayed and store staffs are familiar with the
features of the product line, all the while helping to
clean and organize their product lines for the store
[39].
(3) Continuous Replenishment program (CRP) :- The
"continuous replenishment system" sends orders
for new merchandise directly to suppliers as soon
as consumers pay for their purchases at the cash
register. Point-of-sale terminals record the bar code
of each item passing the checkout counter and send
a purchase transaction directly to a central computer
[33]. This computer collects the orders from all stores
and places orders with their suppliers to replenish
the sold products. Suppliers can also access sales
Special issue
and inventory data using Web technology. It is also
a highly practiced system of Wal-Mart.
(4) Efficient Consumer Response (ECR):ECR Europe Executive Board expresses the
ECR definition as “Efficient Consumer Response
(ECR) is the realization of a simple, fast and
consumer driven system, in which all links of the
logistic chain work together, in order to satisfy
consumer needs with the lowest possible cost”.
Efficient consumer response (ECR) combines the
two innovations on a conceptual level, i.e. efficient
replenishment and category management [40]. ECR
has a few starting points. Firstly the definition shows
that consumer demand plays an important part. The
chain has to ensure continual improvement of
consumer satisfaction, products, and quality.
Secondly, the definition also shows that maximum
efficiency of the total logistic chain is required [34].
The realization of the two starting points cannot be
done without accurate information, which must be
available when needed. To keep the costs low, it is
preferred that this information and communication
is paperless.
(5) Collaborative Planning, Forecasting and
Replenishment (CPFR):- Voluntary Inter industry
Commerce Standards (VICS) defines Collaborative
Planning, Forecasting and Replenishment (CPFR)
as a business practice that combines the
intelligence of multiple trading partners in the
planning and fulfillment of customer demand. CPFR
links sales and marketing best practices, such as
category management, to supply chain planning and
execution processes to increase availability while
reducing inventory, transportation and logistics costs
[40]. The key concepts behind CPFR can perhaps
best be explained by comparing it to the traditional
Reorder Point (ROP) approach. Under a ROP
procedure, retail level planners collect product
information and marketing programs at the product
distribution point level. Combining this information
with point-of-sale (POS) data, item-level forecasts
and event calendars that record promotional dates,
special marketing programs, etc., are thereby
generated [35]. Based upon inventory and/or service
level targets, the forecasts (and all the corresponding
errors) are used to generate reorder points.
When inventory of an item reaches the specified reorder
point, the retailer/distributor places an order to the
manufacturer. If the product is available, it is shipped to
the retailer/ distributor; if not, the retailer/distributor will
seek alternative solutions to replenish the item [30]. The
manufacturer, on the other hand, collects product
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Page 237
knowledge and marketing programs of major retailers
from public sources. Based upon retailer/distributor
orders and historical shipment information, the
manufacturer generates a forecast by item, and in most
cases, by geographic region. These forecasts also drive
the production of the items, as well as the geographic
regions where the items will be produced and warehoused
[41]. However, such independent planning between the
members of the supply chain can result in extended
cycle times, poor customer service, inefficient use of
working capital, items being produced and/or stocked
in the wrong geographic regions, etc. During the last
decade CPFR emerged as a method to counter some of
the shortcomings of the ROP approach. The objective
behind a CPFR initiative is that the trading partners work
off a common forecast or plan. That is, the retailer,
distributor and the manufacturer collect market
intelligence on product information, store promotional
programs, etc., and share the information in real-time
over a global Wide Area Network (WAN). However, with
CPFR the distributor and manufacturer will jointly
redesign key business processes such as setting
increased sales objectives, or improving transaction
mechanisms to reduce costs of all parties [41].
Literature Review
Collaboration is a process of participation through which
people, groups and organizations work together to
achieve desired results. Collaboration, in the context of
the supply chain is to share the joint objections; an
intelligence of commitment; trust and respect; skills and
knowledge; and intellectual agility [9]. Especially in
today’s complex competitive business environment,
collaboration is the driving force behind effective supply
chain management. Supply chain collaboration means
two or more autonomous firms working jointly to plan
and execute supply chain operations [11] Hence supply
chain collaboration can be defined as a joint decision
making process for aligning plans of individual supply
chain members with the aim of achieving coordination
under information asymmetry [3]. Mei Cao [10] defines
supply chain collaboration as seven interconnecting
components: information sharing, goal congruence,
decision synchronization, incentive alignment, resources
sharing, collaborative communication, and joint
knowledge creation.
These seven dimensions are expected to be intercorrelated and co vary with each other although there
might be causal relationships among them. By
collaborating, supply chain partners can work as if they
were a part of a single enterprise. Such collaboration
can increase joint competitive advantage, i.e.,
collaborative advantage. Supply chain collaborative
advantage refers to strategic benefits gained over
competitors in the marketplace through supply chain
Special issue
partnering and partner enabled knowledge creation, and
such synergistic benefits could not be attained by acting
independently [13]. Collaboration involves creating new
values together rather than mere exchange, and it is
controlled not by formal systems but a web of
connections and infrastructures that enhance learning
and open new doors and unforeseen opportunities [14].
Due to the prevalence of information asymmetry,
information sharing is a prerequisite for any collaborative
planning approach. Individual members of the supply
chain dispose of relevant (private) data regarding their
own operations (e.g. cost and capacity data, inventory
levels, demand forecasts) that need to be exchanged in
order to enable joint decision-making [15].
Pibernik et.al [15] introduced the concept of JELS (Joint
Economic Lot sizing) model with alternative benefit
sharing rules, and described secure protocols based on
SMC (Secure Multi Party Computation) that enable
secure computation for stochastically secure
collaborative planning. Bernhard J et.al [12] modeled the
constituents of a collaborative supply chain, the key
parameters they influence, and the appropriate
performance measures in a decision support environment
enables prior understanding of the impact on the
performance of a collaborative supply chain as a result
of changes in the constituents and key parameters.
Yongsheng Liu et al [16] by using the system theory,
psychology and from the aspect of business operation
explained the necessity of adopting collaborative
management for companies facing supply chain crisis.
They proposed strategies of collaborative management
for companies to survive supply chain crisis: to choose
suppliers who have willingness to cooperate; to
coordinate the values among companies; to advance the
visibility of supply chains; to strengthen the cooperation
of security; and to fully tap people’s subjective initiatives.
Yonghui Fu [17] mentioned about the preliminary
approach towards process-oriented collaborative
inventory management in supply chains, taking
advantage of multi agent technology in terms of modeling
and simulation and an SCM support model is proposed
as a foundation to combine the supply chain processes
with the multi-agent system. They also proposed a
reliable and valid measurement of supply chain
collaboration model based on data from 321 companies
from the Qubec Forest products industry using a
structural equation modeling. In spite of the general low
level collaboration in this traditional industry, a first order
measurement followed by a second order confirmatory
factor analysis was done.
Mahesh Nagarajan et al [6] surveyed some applications
of cooperative game theory to supply chain management
with special emphasis on two important aspects of
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cooperative games: profit allocation and stability in a
collaborative environment. The paper first describes the
construction of the set of feasible outcomes in commonly
seen supply chain models, and then uses cooperative
bargaining models to find allocations of the profit pie
between supply chain partners. In doing so, several
models are analyzed and surveyed, and include suppliers
selling to competing retailers, and assemblers
negotiating with component manufacturers selling
complementary components. It also discusses the issue
of coalition formation among supply chain partners. An
exhaustive survey of commonly used stability concepts
was also presented.
Steve G. Sutton et. Al [21] elaborated the integrated
nature of inter organizational relationships or
collaborations in their supply chain and in the
contemporary business model and explored the issues
that should be considered in the development of an
external financial reporting model that adequately
encompasses such relationships. This purpose had been
addressed in two stages. First, a review was provided
on the evolving nature of business relationships from an
enterprise-centric competitive model to a business
environment where competition is better viewed as
supply chain versus supply chain. Consideration was
given to how this alternative view of the business
environment affects the way in which enterprise risks
should be assessed and the impact of these enterprise
risks on the design of effective risk management
programs. The second stage focuses on the issues that
must be addressed in formulating financial reporting
concepts that address enterprise risk across the supply
chain in order to provide investors and other stakeholders
with an understanding of the viability and security of the
value chain.
Kovacs Gyongyi [18] made a framework of environmental
strategies, and links this to alternative approaches in
supply chain collaboration. From an environmental
demand perspective, the focus was given on the
communication of expectations and demand for corporate
environmental responsibility toward the corporation, and
from the corporation to its suppliers. Togar M.
Simatupang et al [19] proposed an integrative framework
for supply chain collaboration which is based on the
reciprocal approach, which can capture the interaction
phenomenon of different features of collaboration in
attaining overall supply chain performance and found that
a collaborative supply chain framework is composed of
five connecting features of collaboration, namely
collaborative performance system, information sharing,
decision synchronization, incentive alignment, and
integrated supply chain processes.
Togar M. Simatupang et al [20] attempted to apply the
Theory of Constraints approach to overcome difficulties
Special issue
in realizing the potential benefits of supply chain
collaboration. Specifically, it shows how the Theory of
Constraints approach can be used to expose an inherent
dilemma of collaboration and establish collaborative
replenishment policy and collaborative performance
metrics so that the chain members can work together
to advance supply chain profitability. Bikram K.
Bahinipatia et.al [23] developed a generic quantitative
model using the Analytic Hierarchy Process–Fuzzy Logic
model (AHP– FLM) to comprehensively assess the
degree of collaboration with individual horizontal
collaboration initiatives with a view to check feasibility
for satisfying the customer requirements. A fuzzy rule
based collaboration intensity index (CII) is developed to
build up the relationships among these evaluation
attributes. Alain Yee-Loong Chong et.al [24] conducted
an empirical investigation on the relationship between
supply chain factors and the adoption of e-Collaboration
tools in the supply chain of Electrical and Electronic
(E&E) organizations in Malaysia. It was found that the
major factors affecting the adoption of e-Collaboration
tools are trust, product complexity and product volume
and frequency. Among the above mentioned trust is found
to have the strongest influence followed by product
complexity and product volume and frequency on the
adoption of e-Collaboration of supply chains. Usha R
et.al [25] attempted to uncover the impact of collaborative
planning, collaborative decision making of supply chain
partners and collaborative execution of all supply chain
processes in the success of collaboration. They have
used an empirical analysis (confirmatory factor analysis
and structural equation modelling using AMOS) to validate
their research paradigm through a questionnaire survey
on the customers of a textile company. The major finding
was it is better to engage in long term collaboration,
depending on the success of current collaboration and
it will help to make investment decisions for the partners.
Usha R [26] identified that nai¨ve forecasting is no longer
cost efficient. Supply Chain (SC) members have found
it very important to exchange relevant information that
will help improve accuracy of demand forecasting. The
author analyses the trade-offs in the information
exchange using an Analytic Hierarchy Process (AHP)
model. The model is then implemented based on case
studies conducted in two manufacturing firms. The AHP
model ranks available information in terms of their
contributions to improve forecast accuracy, and can
provide vital clues to SC partners for preparing
exchangeable data. From the case studies using AHP
model, it was proved that using the preferred SC data,
the firms could enhance forecasts accuracy. This in turn
can help the firms to make decisions on SC collaborative
arrangements for information exchange. Tim Mclauren
et.al [27] analyzes the alternatives for supply chain
November 2015
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collaboration and presented a framework for
understanding the expected costs and benefits of each
type of collaboration system. These costs include not
only the total cost of ownership of the system, but also
the partnership opportunity cost – the cost of being tied
to a partner due to system inflexibility. The benefits of
collaborative SCM identified were process, inventory, and
product cost reductions as well as increased cycle
times, service levels and market intelligence.
Theodore P. Stank et.al [28] identified the automatic
replenishment systems that restock inventory based on
actual demand triggers rather than relying on long-range
forecasts and layers of safety stock, which was
implemented in a great number of firms in recent years.
Now these same firms are taking supply chain
cooperation to another level through involvement in
collaborative planning/forecasting/ replenishment
(CPFR). It also explained about current levels of
involvement in cross-organizational collaboration among
firms utilizing automatic inventory replenishment. The
results provide were highly positive for associations
between high levels of CPFR and implementation of
operating process change and information system
capabilities where as it is found to be very weak in the
association between CPFR and effectiveness in
achieving operational performance goals. Theodore P.
Stank et.al [29] found through their studies that
collaboration with external supply chain entities
influences increased internal collaboration, which in turn
improves service performance. This relationship may be
the key to helping managers understand how best to
facilitate behavioural change. The implication is that
collaborating with customers and suppliers is a first step
toward effective collaboration within the firm.
Xu, K et. al[32] made an extensive study on demend
collaboration since industry leaders find it as an important
tool for supply chain management. Its greatest
significance beyond the sharing of point-of-sale and
forecast information stems from its potential to allow
supply chain partners to extract private market
information from each other for more effective planning
and better supply chain performance. Through this study
there proposed a simulation framework based on actual
business processes is developed to investigate the
underlying drivers of demand collaboration and the
inherent risks and benefits of such collaboration.
Chonticha Mathuramaytha [42] examined the
consequences of SCC on organizational performance.
The research question was how SCC affects firm
outcomes. The concept proposed was that SCC has
positive effect (such as cost reduction and operational
flexibility) on firms and that the effect is a long-term effect
and variable measurement scales to measure the effect
Special issue
of collaboration on organizational performance were
subsequently developed.
Daesoo Kim [43] put forward a concept of harnessing
the power of process chain, a new paradigm toward
achieving global optimization of a common performance
goal for a total supply chain even after much improvement
in supply chain visibility and collaboration. Process chain
is a flexible and efficient chain, network, or web of related
firms that work together to achieve global optimization
of a common performance goal for a total supply chain.
The major objective of process chain is to achieve
globally optimal performance of a common goal for the
total supply chain, not a local optimum from an enterprise
(firm) focus, while avoiding and effectively managing
inherent conflicts. K. Arshinder et al [44] examined about
the supply Chain (SC) members and their dependency
on each other for resources and information, and found
that this dependency has been increasing in recent times
due to outsourcing, globalization and rapid innovations
in information technologies. Yossi Aviv [45] conducted
studies on the potential benefits of collaborative
forecasting (CF) partnerships in a supply chain that
consists of a manufacturer and a retailer. In order to
reflect the reality in production environments, there
proposed a scorecard that captures inventory
considerations, production smoothing, and adherenceto-plans. In addition to this there presented a prescriptive
convex- cost production planning model for the
manufacturer, and a replenishment model for the retailer.
The author used their integrative reference model to study
the potential benefits of CF partnerships. It was found
that the benefits of CF depend on the following key
characteristics of the supply chain such as the relative
explanatory power of the supply chain partners, the
supply side agility, and the internal service rate. CF is
expected to bring high benefits to the supply chain when
the manufacturer has the largest relative explanatory
power. But quite disappointingly, in these cases a CF
partnership does not appear to be valuable to the
manufacturer. When the retailer is the dominant observer
of market signals, CF typically yields a “win-win”
outcome. In order to effectively act upon the information
exchanged via CF, the supply side needs to be sufficiently
agile.
Guangqian Peng et al[46] conducted a study to test the
relationships between information exchange benefits and
company performance, and the mediating effect of supply
chain compliance on this relationship. Analysis was done
on 165 buying companies and 96 suppliers by partial
least square (PLS) path modeling and identified five
company characteristics, including company size,
company age, company type, quality standard
implemented, and administrative level of a as control
variables in the model. The paper extends understanding
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on the relationships between perceived communication
benefits, supply chain compliance, performance and
company characteristics. Managerial implications are
generalized for buyers and suppliers respectively. Judith
M W et al [47] examined the characteristics,
requirements, benefits, and barriers to various
collaborative relationships and proposed a typology of
collaborative approaches. The exploratory interviews with
21 managers from ten different manufacturers and
retailers led to develop a typology of three types of
collaborative approaches (collaborative transaction
management; collaborative event management; and
collaborative process management. Managers can use
the typology to assess current collaborations and seek
ways to improve current collaborative efforts. Managers
can also use the typology to develop collaborative
strategies across a broad spectrum of relationships in
order to determine which type of collaboration best fits
each individual business relationship. T.M.Simatupang
et al [48] identified that in order to ensure that the
participating members in SC collaboration are
progressing on the right track of creating the best-inclass practice is to conduct benchmarking.
Benchmarking stimulates collective learning for
performance improvement that brings benefits to all
participating members, hence there developed a
benchmarking scheme for supply chain collaboration that
links collaborative performance metrics and collaborative
enablers. Umit S. Bititci et al [49] discussed collaborative
relations and the factors that affect its formation and
intensity in supply chains and developed a theoretical
framework/ model that draws the relations and
interrelations between the different factors and their effect
over collaborative potentiality and intensity. Friday Derek
et al [50] investigated the effect of trust and commitment
on vertical collaboration and physical distribution service
quality in the soft drinks’ demand chains in Uganda
predictor of physical distribution service quality however,
was vertical collaboration and all the study variables
accounted for 13% of the variation in physical distribution
service quality.
Stephan Vachon et al [51] by using a survey of North
American manufacturers examined the impact of
collaborative green supply chain practices (GSCP) on
manufacturing performance. Collaborative GSCP were
defined to include the interactions between organizations
in the supply chain, including such aspects as joint
environmental goal setting, shared environmental
planning, and working together to reduce pollution or
other environmental impacts. It was found that these
practices can be directed either upstream toward
suppliers or downstream toward customers. The
influence of collaboration in each direction was
empirically assessed for multiple objective and perceptual
Special issue
measures of manufacturing performance using a sample
of plants in the package printing industry.
Conclusion & future scope of research work
Most recently, the supply chain collaboration has
become an important area because organizations have
realized that even smaller suppliers are important to be
ahead in this competitive environment, as disruptions
from their end could potentially disrupt the entire supply
chain. And hence it demands close attention to issues
such as effective ways to streamline processes and gain
greater visibility into their operations in order to lower
the overall costs. Whilst some research has begun to
examine the functionality of collaboration in supply chain
through Joint Economic Lot Sizing model (JELS), secure
supply chain protocols and Secure Collaborative
Planning, Forecasting and Replenishment (SCPFR)
models, integration of collaborative planning and
optimization of supply chains, risk sharing under random
yields etc. But little attention has been paid to areas
like stochastic benefit sharing models in different
collaboration schemes, collaboration between parties in
two subsequent stages, multi party collaborated supply
chain and collaboration at different stages of supply chain
planning. Factors such as cultural backgrounds of the
members of a supply chain can be tested to see if these
have an impact on information sharing among supply
chain partners [25]. Since much of the modern
collaboration among geographically separated firms
takes place in virtual space, it will be a new arena to
explore the role of technologies like cloud computing,
Internet of Things etc. Comparison between pre adoption
status and post adoption results, the impact of IT tools
in collaboration and standardization practices and
harmonization of channels for collaboration will be an
interesting field of research [1]. Another interesting area
for investigation is the relationships at the subdimensional level between supply chain collaboration,
collaborative advantage, and performance. Such analysis
would provide more interesting and useful results for
researchers and practitioners [10]. Future scope in
collaboration research can be identified in developing
multi criteria optimization models for establishing
contributions to be made by compatible partners in terms
of resources sharing for certain joint product development
and supply [23]. Achieving optimal balance of
collaboration and risk management [27] in sharing
proprietary information, potential differences in
manufacturer and retailer perceptions regarding the
impact of collaboration initiatives like CPFR are also good
areas of research. Even though there are instances that
collaboration is moving beyond the expected stage of
acceptance as companies and suppliers adjust to the
new realities of economics, trade and finance, true
collaboration is still relatively rare.
November 2015
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November 2015
Page 243
THE IMPACT OF SERVICE QUALITY ON CUSTOMER SATISFACTION
AND CUSTOMER LOYALTY IN HSBC BANK IN JAFFNA DISTRICT
Sivapragasam Sivanenthira1
Vasanthakumar Kumaradeepan2
Abstract
The key objective of the research work carried out by me is assessing the quality of the service offered by the banks
present in jaffna and other districts administrative districts. Also, this report attempts to understand the relationship
between service quality and customer satisfaction dimension. Employed to evaluate the service quality Offered by
the banks, the key elements evaluated are; assurance, empathy, responsiveness, tangibility and reliability. To carry
out the research, primary data as well as secondary data was made use. The primary data was mainly collected via
self-administered questionnaires. 100 questionnaires were distributed amongst the sample in the selected areas; the
sample was selected based on random sampling method. Precise response was received from 100 questionnaires
for the 28 item measure on the services offered by their banks. Correlation method is used assess the relationship
amongst the variables. Correlation results indicated positive results amongst individual service quality dimensions &
customer satisfaction The research proves responsiveness & empathy are two main key drivers of customer satisfaction
followed by assurance, reliability and tangibility. More over the research goes on to prove over all increment in service
quality would increase customer satisfaction.
Key words: Customer Satisfaction. Customer Loyalty, service Quality
Background of Study
HSBC bank is the leading bank in Sri Lanka gives its
excellent services to their customers more than 10
Decades. HSBC bank Understanding the changing needs
of customers according to their age and level of income
the bank created many accounts and loans and serve
the customers in many ways.
Nowadays many banks realize that all advantages, which
they want to establish through their core products are
quickly, as others banks has the same products being
offered. However, since it’s a well-known fact that no
business can exist without customers the important
strategy is focused on providing the high-quality service
for the customer. In today increasingly competitive
environment, quality service and customer satisfaction
are critical to corporate organizations. Delivering high
quality service is linked to increased profits, cost savings
and corporate image. Customer satisfaction is the route
to sustained high performance. Organizations should be
aware of the fact that customer dissatisfaction leads to
defection and long term losses. Ensuring quality
customer service is everybody’s business in the current
banking industry.Recent years HSBC banks customer
service level has been reduced compare to previous
years and customers complain regarding service level
of the staffs and other issues has been increased. In
order to re gain HSBC banks world class committed
customer service levels in future this research. This Will
helps to improve the customer service level and give
some valued ideas and answers as well. This research
will support the bank to give more world class service to
their customers and improve the good will of the
customers. Below this research has given few related
issues makes customer dissatisfaction and it will lead
to customer complain and HSBC banks good will has
been dropped.
Problem Identification at HSBC Bank
In this era banks has many choices in banking and
competing with other competitor banks in order to
sustain in their banking industry on only in Sri Lanka
but globally too. Bank customers have more choices in
how, when and where they can to do their banking today
and them try to get their lives more easily by banking.
(Phone banking/internet banking/palm top banking / door
to door banking/ express banking/ day and night
banking). Changing bank is easy and the engagement
with one specific bank is not life-long anymore.
Nowadays banks facing many difficulties to sustain in
the industry and to retain its customers with them. There
are many issues we have identified and from those issues
main issue is the customer service level is dropping in
the banking industry including HSBC bank. The HSBC
bank is providing various facilities to consumers to
satisfy them. However, it does not satisfy the
consumers. Service quality of the bank is also influenced
on the customer satisfaction and customer loyalty. This
research has listed main reason for the customer service
level drop of HSBC bank. Need to improve customer
service level and customer satisfaction.
1
. Faculty of Management Studies and Commerce, University of Jaffna.
. Faculty of Management Studies and Commerce, University of Jaffna
2
Special issue
November 2015
Page 244
Research Objectives
• To find out the impact of service quality on customer
satisfaction of HSBC bank.
• To find out the impact of service quality on customer
loyalty of HSBC bank.
• To identify the relationship between service quality
and customer satisfaction of HSBC bank.
• To identify the relationship between service quality
and customer loyalty of HSBC bank.
Theoretical Review
Customer satisfaction
In line with Tsoukatos and Rand (2006), customer
satisfaction is a key to long-term business success. To
protect or gain market shares, organizations and banks
need to outperform competitors by offering high quality
product or service to ensure satisfaction of the customers.
In proportion to Magesh (2010), satisfaction means a
feeling of pleasure because one has something or has
achieved something.
Service Quality
Service Quality can be define as “the difference between
customers’ expectations for service performance prior
to the service encounter and their perceptions of the
service received (Asubonteng et al 1996) Service quality
is the subjective comparison that customers make
between the qualities of the service. That they want to
receive and what they get (Gefan 2002) Service quality
is determined by the differences between customer’s
expectations of the services provider’s performance and
their evaluation of the services they received
(Parasuraman et al 1985, 1988)
Customer Loyalty
"Service loyalty refers the degree to which a customer
exhibits repeat purchasing behavior from a vendor /
service provider, possesses an optimistic attitudinal
disposition toward the service provider, moreover deems
using only this provider when a need for this service
arises" (Gremler and Brown, 1996, cited in Caruana,
2002, p 813).
Sample size
Sample size refers to the number of elements to be
included in the study (Malhothra, 2007). Once the target
population of the study is defined, it is required to decide
the sample size for the study. Number of sampling
elements in the present study consisted of in retail
banking services.There are 100 customers were
surveyed to collect data to identify the in retail banking
services.
Special issue
Reliability and Validity
Nunnally (1978) gives the common guideline for the alpha
standard of reliability: a) early stage of research
alpha=0.5-0.6 b) basic research alpha, alpha= 0.7- 0.8,
and c) applied settings, alpha= 0.8-0.9.The reliability of
the questionnaire was tested using Cronbach’s Alpha
(a) measurements. The reliability coefficients (a) of each
construct or latent variable are given in the table.
Reliability Statistics
Cronbach's Alpha
N of Items
.835
28
KMO and Bartlett's Test
Kaiser-Meyer-Olkin Measure of
Sampling Adequacy.
.526
Bartlett's Test of Sphericity
Approx. Chi-Square
798.958
df
378
Sig.
.000
The Kaiser-Meyer-Olkin (KMO) has a measure of 0.526,
which is above the threshold of 0.5 (Field, 2005). The
Bartlett’s test is signi?cant in this study with 798.958
( p-value , 0.001). Therefore, the KMO value of 0.526
and signi?cance of Bartlett’s statistic con?rm the
appropriateness of the analysis for the data set.
Data Analysis
Correlation analysis
Quality Satisfaction Loyalty
quality
Pearson
Correlation
Sig. (2-tailed)
N
satisfaction Pearson
Correlation
Sig. (2-tailed)
N
loyalty
Pearson
Correlation
Sig. (2-tailed)
N
1
.678
.765**
.000
.003
100
100
1
.668
.000
100
1
There is a positive relationship between service quality
and customer loyalty .765 at 0.01 significant level. And
there is a positive relationship between customer
satisfaction and customer loyalty .668 at 0.01 significant
level
November 2015
Page 245
Loyalty
Customer
loyalty
Tangibility
.685
.568
.000
.001
.005
.009
.009
100
100
**
.486
100
**
.444
100
.212
100
*
.249
Sig. (2-tailed)
.000
.000
.090
.046
N
100
100
**
.459
100
*
.281
.164
Sig. (2-tailed)
.000
.023
.192
N
100
100
**
.344
100
.240
.005
.054
100
100
**
.323
1
1
Pearson Correlation
1
Pearson Correlation
responveness Sig. (2-tailed)
N
1
Pearson Correlation
empathy
Assurance
.675
Pearson Correlation
reliability
Empathy
.567
N
tangibility
Responveness
.678
Pearson Correlation
Sig. (2-tailed)
1
Reliability
Sig. (2-tailed)
.009
N
100
1
Pearson Correlation
assurance
100
Sig. (2-tailed)
N
There is a significant relationship between customer loyalty and tangibility .678 at significant level at 0.01 and there
is a significant relationship between customer loyalty and reliability .567 at significant level at 0.01, There is a
significant relationship between customer loyalty and responsiveness .675 at significant level at 0.01, There is a
significant relationship between customer loyalty and empathy .685 at significant level at 0.01 and There is a
significant relationship between customer loyalty and assurance .568 at significant level at 0.01
Regression analysis
Model Summary
Model
R
R Square
Adjusted R Square
Std. Error of the Estimate
1
.379
.544
.516
.40383
a. Dependent Variable: loyalty
b. Predictors: (Constant), satisfaction, quality
There is a significant impact of service quality and customer satisfaction on customer loyalty 51.6% at 0.01
significant levels.
Hypotheses testing
There is a positive relationship between service quality
and customer loyalty .
Correlation
analysis
765 at 0.01
significant
levels.
Accepted
there is a positive relationship between customer
satisfaction and customer loyalty
Correlation
analysis
.668at 0.01
significant level
Accepted
There is a significant impact of service quality and
customer satisfaction on customer loyalty
Regression
analysis
51.6%at.01
significant level
Accepted
Special issue
November 2015
Page 246
Suggestions for further research
• The effectiveness of any bank are influenced greatly
by consumer behaviors. Customers who are a
resources common to all banks. Effective’s service
quality helped to create a customer satisfaction and
customer loyalty. That encourages, support and
sustained improvement in customer satisfaction. The
following suggestion recommended for future
researches.
• In this study only Jaffna district bank is considered
to develop the analysis and findings. There are
millions of customers and banks in Sri Lanka. In future
studies could consider almost all customers and
banks in the others of district.
• Finding of this study analyzed only the customers of
Jaffna district bank. But there are various types of
banks and different types of customers in Jaffna and
other district. So, this analysis will helpful to conduct
the further researcher including all the customers in
bank of Sri Lanka.
• Even through various factors determine the customer
satisfaction, if is considered as to how the other
factors influence on the satisfaction and loyalty of
the customer of the bank in this analysis. Therefore,
the analysis in relation to other factors that determine
the customer loyalty must be considered.
• There are so many factors influencing service quality.
Service quality has ten important factors. But, this
research only considered five variables; tangibility
reliability responsiveness assurance and empathy.
Therefore, in future, to decide to conduct this
research, various other factors should also be taken
into consideration.
Conclusion
This study concluded that there is a positive relationship
between independent variables and dependent variable
and Service quality and customer satisfaction have
impact on Customer loyalty. As far as bank customers
are concerned. They appear to be quite satisfied with
their service. If we implement the recommendations
made above the service could be further enhanced for
the maximum satisfaction of bank could obtain
competitive advantage and come to a higher profitability.
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ISSN : 2321-3604
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