Sales Promotion Schemes Project Report MBA

Sales Promotion Schemes Project Report MBA

One of the most difficult marketing decisions facing companies is how much to spend

on promotional John Wanamaker, the departmental - store magazine, said, "I know

that half of my advertising is wasted but I don't know which half."

Thus it is not surprising that industries and companies vary considerably in how much

they spend on promotion. Promotional expenditures might amount to 30-50% of sales

in case in cosmetics industry and only 10-20% in the industrial equipment industry.

Within a industry, a low and high spending companies can be found.

How do companies decide on their

promotion budget? There are mainly

four methods of sales promotion :

• Affordable Method :

Many companies set the promotion

budget at what they think the

company can afford. One executive

explained this method as follows :

"Why, it’s simple. First I go upstairs

to the controller and how much they

can afford to give us this year. He

says a million and half. Later, the

boss comes to me and asks how

Advertising Effectiveness Project Report

Internal Customer Satisfaction Project Report

much we should spend and I say ‘Oh

about a million and half."

It is a method which is uncertain one

and makes long term planning

difficult.

• Percentage of Sales Method :

Many companies set their promotion

expenditures at a specified

percentage of sales. Accordingly the

sales is set on the basis of sales.

In this a specified sales percentage is decided for the promotional budget Advantages

of this method :

First, its use means that promotional budget vary with what a company can afford.

Second, it encourages the management to think in terms of the relationship among

promotion costs, selling price, and profit per unit,

Third, it encourages the competitive stability to the extent that competing firms spend

approximately the same % of their sales on promotion.

Inspite of the advantages, the % sales method has little to justify it. Its reasoning is

circular : It views sales as the determiner of the promotion rather than as a result. It

leads to budget setting by availability of funds rather than by marketing opportunities.

• Competitive Parity Method :

Some companies set their promotional budget to achieve share-of-voice parity with

other competitors. Two arguments are made in support of competitive parity method.

One is that the competitors expenditure represents the collective wisdom of the

industry. The other is that maintaining a competitive parity helps prevent promotional

wars.

Neither argument is valid. There are no grounds for believing that competition knows

better what should be spent on promotion.

• Objective and Task Method :

The objective & task method calls upon marketers to develop their promotion budgets

by defining their specific objectives, determining the task that must be performed to

achieve these objectives, and estimating the cost of performing these tasks.

Deciding on the promotion mix :

Companies face the task of distributing the total promotion budget over the five

promotional tools :

• Advertising

• Sales Promotion

• Public Relations and Publicity

• Sales Force

• Direct Marketing.

Whatever method a company adopt for promoting its product it must be from above

mentioned method.

What is Sales Promotion ?

Promotion is the final element in the marketing mix. After the nature of product is decided, its

price fixed and the methods of distribution decided, the manufactures has to take effective steps

in meeting the consumers in the markets. In the present consumer oriented markets it is the duty

of manufacturers to know what is required by the consumer. It is also their duty to make the

customers know where, when how and at what prices. The products would be available.

Meaning of Promotion

The term promotion is the term and includes mainly three type of sales activity :

1. Mass impersonal selling methods (Advertising).

2. Face to face personal selling (Salesman ship).

3. Activities other than personal selling and advertising such as point of purchase

display (P.O.P.) show and exhibitions, demonstrations and other non securing selling

efforts. This form of activity is called ‘Sales Promotion’.

There are two type of promotion blends :-

1. Pull Blend.

2. Push Blend.

Both of these are closely related to the channel of Distribution.

1. A pull blend is one in which mass impersonal, sales efforts are given the greatest

emphasis. The purpose of pull blend to pre-sell to the final consumers. So that they

demand the product at the retail level of distribution. The firm adopting this strategy

would spend more on advertising and sales promotion rather than in personal selling.

These efforts pull down the product from the manufacturer.

2. A push blend emphasizes personal selling. Naturally firms adopting this method

develop a strong sales force at both the distributor and the dealer level. This method

would tends to push the product through the channel of distribution.

Promotion and Selling

The term promotion is very often used as a synonym for selling. But selling is a narrow

term which includes only transfer of title or personal selling. Promotion on the other hand

is broader in its outlook and includes a variety of activities used ultimately for increasing

sales volume.

Promotion and Sales Promotion

Similarly the terms sales promotion can not be taken to mean what is commonly does. Sales

promotion, is only a part of the promotion. Basically promotion is an "exercise" in information

persecution and influence. Promotion has come to mean the over all co-ordination of advertising

selling, publicity and public relations. Promotion is a helping function designed to make all other

marketing activities more effective and efficient. But sales promotion as such helps only the

selling activity still, there exit same difference of opinion on the real connection of the term sales

promotion.

Acc. to A.H.R. Delons :-

"Sales promotion means any step that are taken for the purpose of obtaining or increasing sales".

Acc. to W.Q. Kelly Opines :-

"Muddled misused misunderstood that is sales promotion Acc. to him the field of

sales promotion as a marketing activity is still vaguely defined and organized.

Sales Promotion and Advertising

There is no universally accepted distribution between these two terms. To same advertising

includes all forms of mass media communication directed towards influencing the end consumer.

Sales promotion on the other hand, includes the form of mass communication directed towards

information and influencing the channel of distribution (e.g. distributors, retailers etc.). Hence a

price of product literature distributed by retailers in sales promotion. These sales promotion

merges on one side in to advertising and on the other in to personal salesman ship. It is

concerned with the dissemination of information to whole salers, retailers, customers (both actual

and potential, and to the salesman).

Sales promotion is concerned with the creation. Application and dissemination of material and

techniques that supplement advertising and personal selling. Sales promotion makes use of direct

mail, catalogues, trade shows, sales contests, premiums, samples, windows displays and other

aids. Its purpose is to increase the desire of salesman, distributors and dealers to sell a certain

brand to make consumers more eager to buy that brand. Personal selling and advertising do

include prospects to make these decisions. Sale promotion provides an extra stimulus.

Objective of Sales Promotion

1. To increase sales directly by publicity through media which are complementary to press and

poster advertising.

2. To disseminate information through sales man dealers etc. So as to insure the product getting

in to satisfactory use by the ultimate consumer.

3. To attract new consumer.

4. To face the competition effectively.

5. To help salesman in selling more to the retailers and consumers.

6. To check seasonal decline in sales. Generally speaking sales promotion involves rendering the

following services:-

(a) Services to dealers.

(b) Services to own salesman.

(c) Special publicity.

Sales Promotional at different levels

1. Sales promotion at Dealers Level :-

It may include various schemes some of which are discussed here.

(i) Advertising Materials :-

The advertising material prepared by the company such as store signs, banners, shelf signs, board

etc. are distributed to sub dealer for display purposes this is in fact a method of advertising.

(ii) Store Demonstration :-

In the promises of the whole saler or the retailer the products sales personnel will conduct special

demonstration for the companies product. A personal demonstration is good to introduce a new

product at its peculiar advantage can be high lightened and the consumer’s doubt clear. It can be

used to restimulate an old product. A good demonstration with a great dealer of action will draw

heavy crowds in to the store and will attract attention to the product.

(iii) Special Display and Shows :-

These are in seasonal in character but could be arranged in an elaborate manner and for all the

products of an company. Usually these are arranged along with trade fair and exhibition. Besides

effecting sales these shows impress the company’s name generally on the public.

Sales promotion at consumer’s level

The various schemes of sale promotion at Consumer’s Level may include.

1. Coupons (A Chit of Stated Value) :-

These are given directly to the consumer these coupons are in most cases kept inside

the package. The consumers many receive a price reduction of the stated values of the

coupon at the time of purchase. The retailer receives reimbursement for the value of

the coupon form the manufacturer. Coupons act as a short run stimulus to the sale of

the product, since they are directly tied with the purchase of the item. They encourage

the retailer to stock the product.

What is important is that a coupon offer does not spoil the named price of the brand

nor does it un pair the margin of the dealers. But it is not easy to measure the

effectiveness of a coupon offer. One over knows how many customer would have

bought the product without the incentive. It is also difficult to find out how many

customers were held after the coupon offer expired.

2. Price-off-offer (Also known as bargain offer price packs) :-

This offer is intended to stimulate the sales during a slump season. In this method the

customer is offered a reduction from the printed price list. It is also used when a

substitute for competing product enters the market.

Many experts on sales promotion fed that ‘Off Schemes’ are among the weaker and

less desirable methods of promotion. These can be trade resentment particularly when

the retailer raises the price to retain his margin. Secondly that is not conductive to

building up brand loyalty. Consumers may simply shift to the products that offer this

scheme.

3. Samples :-

In the hope of converting a prospect into a customer a sample (Some quantity of the

product) may be given. This helps the consumer to verify the real quality of the

product. Various pair manufacturing companies offer this method. For developing

brand loyalty this method is quite useful. Sampling is a fast method of demand

creation because one knows the result as soon as the consumer has had time to use the

sample and buy the brand.

Disadvantage of Sampler :-

Offering sample in quit expensive. There is the cost of producing samples. The

distribution costs are also high. Sample have to be mailed to potential customers or to

be distributed through retail shops. There are also problems when the real product

does not resemble the sample supplied.

4. Money Refund Offer :-

An offer usually stated on the package is that manufacturers will return with in a

stated period part or all of the purchaser’s money if he is not completely satisfied with

the product.

5. Trading Stamps :-

A premium in the form of stamps is given by the sellers to consumers while selling

goods. The number and value of stamp that the buyer receives depends on the values

of the purchase. These stamps are redeemable through premium catalogues at the

stamp redemption centres.

6. Buy-Back Allowance :

This an allowance following a previous trade deal not offer a certain amount of money

for new purchases based on the quantity of purchases on the first trade deal. It extends

the life of a trade deal and helps to prevent part deal sales decline. It greatly

strengthens the buyer’s motivation to co-operate on the first deal.

7. Premium :-

There are various forms of premiums provided by the manufacturer as sales

promotional devices :-

(a) Coupons are supplied for effecting price reductions.

(b) Factory in pack premium these are popular in the case of Body food and Tin food

items, Spoons, Cups, Measuring, Glass etc. and such other items are packed with the

product in the box itself. Factory in pack premium are particularly goods for product

meant for children. The Binaca Toothpaste packs contain animal shape toys. These are

very attractive and qutie popular among the children.

(c) Self Liquidating Premiums :-

The cost of the premium is collected from the buyer himself. But when the buyers

pays for it he has to pay only a considerably low price for the premium. This is

possible for the manufacturer purchases the items in bulk at a premium and his cost

per unit as is substantially low.

Other Steps by Manufacturer for Promoting Sales

Dealers can be helps in different ways :-

1. Communicating Market News :-

Often this service is reciprocal the manufacturer may acquaint his dealer with the fact

relating to his production and prices while the dealer may familiarize him in return

with the information bearing on charges in the consumer's demand, their like and

dislike complaints and criticism, substitutes etc.

2. Inviting to Sales Conference and Convention :-

The gestures of regard and respect pave the way for better relation and co-operation.

3. Offering Reasonable Terms of Sale :-

Of all the forms of encouragement, the monetary incentive evokes immediate

response. Hence every producer must offer the most responsible terms of sale such as

longer periods of credit and higher rates of descants.

4. Supplying suitable packages and useful things.

5. By taking the return back.

6. By furnishing them with sales literature and display materials.

Aggressive Selling

Meaning :-

Goods are produced for market. Manufacturers have to make efforts to sell all they

produce. When the manufacturers uses various sales efforts to obtain increased sales

volume for his product it is called aggressive selling or offensive selling. The sales

efforts which a manufacturer makes to retain his customers i.e. to protect his already

established market against against his competitors is termed as defensive selling. In

contrast to this aggressive selling is concerned with the sales efforts made with the

express objective of selling more by expanding the market for the product of the

selling firm.

Aggressive Selling and Defensive Selling :-

Aggressive selling is based on the answer to the question how much does the firm

gain (in term of sales with profit) by using this method defensive selling is based on

consideration as to how much the firm will lose if it does not use this method increase

of sales can be obtained from two sources:-

1. New customers if the market is expending.

2. From the competitors i.e. those consumers who were purchasing similar product of

competiting firms, if the market for the product is static.

Acc. to H. Whitehead :-

"In case of an expanding market all the firm may stand to gain by following the

methods of aggressive selling but if the market is static manufacturer of a new market

will have to be much more aggressive to capture the established market of

competitors".

When Aggressive selling is resorted ?

Usually manufacturer of a new product has to do aggressive selling :-

1. When the product has been improved.

2. When the manufacturer’s product is supervisor in quality to the product of the

established competitor.

3. When the total market for the product or line of product to expanding.

4. If the manufacturer’s share of the market is comparatively small.

5. If the manufacturer has unused production capacity with heavy investment in plant

and equipment he will like to develop the demand for his product rapidly so that

demand for his product is equal to the optimum production capacity of his plant ; and

6. When primary demand for a product must be created and provision must be made

in the channel of distribution to educate consumers regarding the new product and to

instruct them in its use.

Method of Aggressive Selling :-

Sales promotion efforts use for aggressive selling may be divided in two classes.

1. Trade Promotion.

2. Consumer Promotion.

1. Trade Promotion :-

Under trade promotion methods special incentives are offered to the trader to buy

products of the firm. Such incentive may take one or more of the following firm :-

(a) Cash Allowance :-

A definite percentage of discount is allowed on the purchase of given unit of a

product.

(b) Extra Product :-

Instead of giving any cash allowance extra product is given with each unit of product

ordered. For instance if a box normally contains 20 Cakes of Soap, special box

contains 25 cakes may be made and sold at the same price as that of the box of 20

cakes.

(c) Gifts :-

Various gifts are awarded in return for an order of a particular magnitude.

2. Consumer Promotion :-

Under consumer promotion method special incentives are offered to the consumers to

buy the firms product. The more prominent amongst such incentives are as following.

(a) Coupons :-

A coupon of a giving value is sent to the consumer. By presenting this coupon to the

retailer consumers can purchase a particular product mentioned on the coupon at a

reduced price. The retailer sells the products mentioned. In the coupon to such

consumer (consumers presenting the coupons) under and agreement with the

manufacturer at a price lower than the user retail price. Thus the consumer get the

benefit of reduced price to the extent of the value of the coupons.

(b) Self Liquidating Offers :-

Under this system, the firm offers an article at an attracting price if the consumer send

a given sum of money accompanied by a given number of box tops from the packages

of a particular product the benefit to the consumer is that he receives the articles at a

bargain price.

(c) Bargain Packs :-

Under this system a product is sold at a reduced price for a short period Bargain pack

method encourages new consumers to try the product. It is also helpful in obtaining

large displays in the shops.

(d) Sampling :-

The method involves giving the product or a small quantity of the product to a

consumer free with the hope that the customer will be favourable impressed with its

actual use and will eventually become a regular purchaser of the product.

A firm selling new product or an extensively improved product finds this methods

useful. Also a firm whose market is hold by competitors whose free sampling almost

expensive.

The above mentioned methods may be reinforced by adopting.

(i) Direct method of selling through.

(ii) Offer of door to door selling.

(iii) Hire purchase and installment payment methods of selling and by forming

combination.

Other Methods of Aggressive Selling :-

(i) Employment of ‘Missionary Salesman also known as Promotional Salesman’.

These salesman call upon retailers and aggressively promote a product.

(ii) Instead of using wholesalers, the firm may develop its own sales force to call

directly on retailers.

(iii) The firm may follow a compromise method by employing a manufacturer’s agent

and giving him a large enough commission to encourage him to sell product

intensively and aggressively.

(iv) New territory exploitation sales promotion has a particularly important role in

developing the company’s product in new territories.

(v) Increment and promotions.

(vi) Letters to dealer and Customer.

In fact, an ingenious sales manager can devise any number of incentives schemes for

promoting the sales volume.

Data Collection :-

There are two main sources for collecting data. These are :-

1. Primary Data.

2. Secondary Data.

1. Primary Data :

It is the data that is collected for the first time. It is fresh and the originally collected by the surveyor.

In this Project - Sales Promotion Schemes, the researcher contacted 250 customers and situated on the various points of the Sonepat, Panipat, Karnal & nearby areas.

The response were collected personally by the reasearch through a structural questionnaire, consisting of 20 questions.

2. Secondary Data :

Secondary data is the one which is collected by the some one else and already used in some or the other form. Here the secondary data used was the theoretical aspects of promotional tools and the statistical method made use of.

Sample :-

A sample of 250 customers was chosen from Sonepat, Panipat, Karnal & nearby areas. The sample chosen was fully on the basis of convince of the researcher. It was a non-probability sample.

Analysis and interpretation :-

The total data was presented in simple tables, graphs and percentage method was used for interpretation.

Limitation :-

Due to time and money constrains the present study was confined only to a sample of 250 customers and that too of Sonepat, Panipat, Karnal & nearby areas.

Questionnaire

Name :

Age : 18-30 30-40 Above 40

Profession :

Income :

3000-5000 5000-7500 7500-10000 10000-15000 Above 15000

1. Have you heard about the brand Grasim/Grasim Suiting?

Yes No

2. Have you ever seen the Advertisement of Grasim ?

Yes No

3. Where did you saw the Advertisement

On T.V. In Magazine Hoarding Others

4. Does it provides the sufficient information about the product you needed ?

Yes No Partially

5. Can you recall the content of Grasim Advertisement ?

Yes No Partially

6. What do you think about the consistency of Grasim’s advertisement ?

Excellent Good Average Poor

7. Which channel do you watch most frequently ?

DD1 DD2 Zee T.V. Sony Star Plus Zee News Others

8. Have you ever heard about "Mr. India" "Mr. International" Contest organised by Grasim ?

Yes No

9. Do you found these events as are effective advertisement medium ?

Yes No Partially

10. What type of advertisement do you like the most ?

Personality Symbol Musical Fantasy Life Style

11. Which other advertisement can you recall ?

Raymonds Siyaram Vimal OCM Mayur Dinesh Grasim Digzam

12. Which advertisement is most consistent ?


13. Which brand in the fabric is the most frequently advertised on T.V. ?


14. Have you purchased Grasim Product ?

Yes No

15. Have you satisfied with the product ?

Fully Satisfied Partially Satisfied Dissatisfied

16. Do you know the new product launched by Grasim viz. coolers, WWF, SUMO ?

Yes No

17. Do you recommend the product to others if you are satisfied with it ?

Frequently Occasionally When asked Never

18. Which Media do you like is the most efficient for advertising fabric ?

Electronic Print Outdoor Mail Word of mouth

19. Do you feel good when you see the advertisement of the brand which you have purchased ?

Yes No

20. What time of the day do you feel the best for the advertisement on TV ?

Morning Mid-day Evening Late night

CHAPTER - 1

HRD MANAGEMENT IN IT INDUSTRY

1.0 INTRODUCTION

1.0.1 Success of every business enterprise depends on its human resource. Money, material and machines are inert factors; but man with his ability to feel, think, conscience and plan is the most valuable resource. At the same time human elements are most difficult to be inspired, controlled and motivated. The upcoming competition in India, will demand high motivational level of its employees.

1.0.2 Growth of an enterprise is vital for the economic development of the country. This is possible only by maintaining the enthusiasm and motivation of the employees, which is vital for carrying out the operations in most efficient manner. The most successful companies, all over the world have designed their business policies to achieve higher productivity by using potentiality and strength of people.

1.0.3 The basic aim of human policies is the genuine concern for the people. Proper design of human policies is based on the higher responsibilities, personal and positive approach in the total perspective of organisational interest. The world's best companies have established their strength with their people. The employees identify themselves with the company they are working for. This also help in building up their spirit, morale and espirit-de-cops which becomes strength of the company. The culture of excellence thus nurtured contribute to growth with stability and continuous improvement in productivity.

1.0.4 Finding the right man for the job and developing him into a valuable resource is an indispensable requirement of every organisation. Human resources are capable of enlargement i.e. capable of providing an output that is greater than the sum of the inputs. Proper recruitment helps the line managers to work most effectively in accomplishing the primary objective of the enterprise. In order to harness the human energies in the service or organisational goals, every manager is expected to pay proper attention to recruitment, selection, training, development activities in an organisation. Proper promotional avenues must also be created so as to motivate employees to peak performance. Thus, personnel functions such as manpower planning recruitment, selection and training, when carried out properly, would enable the organisation to hire and retain the services of the best brains in the market.

1.0.5 The human resource management is very crucial in respect of information technology services than other manufacturing or marketing enterprises. The IT services are technical in nature and at every stage the human touch is involved. Hence it is well motivated and devoted manpower which is very much essential for the success of IT industry.

1.1 ROLE OF HR MANAGERS

1.1.1. And Some industry commentators call the Human Resources function the last bastion of bureaucracy. Traditionally, the role of the Human Resource professional in many organizations has been to serve as the systematizing, policing arm of executive management. In this role, the HR professional served executive agendas well, but was frequently viewed as a road block by much of the rest of the organization. While some need for this role occasionally remains you would no want every manager putting his own spin on a sexual harassment policy, as an example—much of the HR role is transforming itself. The role of the HR manager must parallel the needs of his changing organization. Successful organizations are becoming more adaptable, resilient, quick to change direction, and customer-centered. Within this environment, the HR professional, who is considered necessary by line managers, is a strategic partner, an employee sponsor or advocate, and a change mentor.

1.1.2 Strategic Partner:-In today’s organizations, to guarantee their viability and ability to contribute, HR managers need to think of themselves as strategic partners. In this role, the HR person contributes to the development of and the accomplishment of the organization-wide business plan and objectives. The HR business objectives are established to support the attainment of the overall plan and objectives. The tactical HR representative is deeply knowledgeable about the design of work systems in which people succeed and contribute. This strategic partnership impacts HR services such as the design of work positions, hiring; reward, recognition, and strategic pay; performance development and appraisal systems; career and succession planning; and employee development.

1.1.3 Employee Advocate:-As an employee sponsor or advocate, the HR manager plays an integral role in organizational success via his knowledge about and advocacy of people. This advocacy includes expertise in how to create a work environment in which people will choose to be motivated, contributing, and happy. Fostering effective methods of goal setting, communication, and empowerment through responsibility build employee ownership of the enterprise. The HR professional helps establish the organizational culture and climate in which people have the competency, concern, and commitment to serve customers well. In this role, the HR manager provides employee development opportunities, employee assistance programs, gain sharing and profit-sharing strategies, organization development interventions, due process approaches to problem solving, and regularly scheduled communication opportunities.

1.1.5 Change Champion:-The constant evaluation of the effectiveness of the organization results in the need for the HR professional to frequently champion change. Both knowledge about and the ability to execute successful change strategies make the HR professional exceptionally valued. Knowing how to link change to the strategic needs of the organization will minimize employee dissatisfaction and resistance to change. The HR professional contributes to the organization by constantly assessing the effectiveness of the HR function. He also sponsors change in other departments and in work practices. To promote the overall success of his organization, he champions the identification of the organizational mission, vision, values, goals, and action plans. Finally, he helps determine the measures that will tell his organization how well it is succeeding in all of this.

1.2 LEADERSHIP AND EMPLOYEE INVOLVEMENT.

1.2.1 The main role of leadership was seen as creating a participatory process for employee involvement, to build collective wisdom. Control has given way to collaboration and the old paradigm of promoting competition and motivating through incentives shifted to creating co-operation and oneness amongst people. This is a marked shift to build effective teams. Research shows that six out of every 10 employees like to work in teams. 87 per cent of all Fortune 500 companies use parallel teams and about 100 per cent of all companies use project teams.

1.2.2 Story telling and appreciative enquiry are emerging as a new dimension in positive motivation. Finding out what's wrong seems to be the trend. In Walt Disney, telling success stories is one of the important methods used to remind people of greatness and goodness of the organisation. Leaders in Disney concentrate on quality, values and involvement. Speaking in the plenary sessions, Tom Peters said, " We have transitioned from an asset-based economy to a talent-based economy. The new definition of lay-off is untalented go talented stay. Leaders must realise that talent is equal to brand". His new theory is EVP which means "Employee Value Proposition".

1.2.3 Rosabeth Moss Kanter said, " Human beings are good raw material, they become assets when you train them to increase their knowledge and skills". She added that only a few organisations really train people to make them a success. Seconding this, Mr Peters pointed out how most organisations are not serious about developing people. They spend on an average 26.3 hours per person per year on training. A surgeon, a pilot or an athlete on the other hand spends 10-15 times more on training.

1.2.4 He also stated that the HRD department should be renamed TDFD (Talent Development Fanatic Department) and wealth for this new regime will flow from innovation, not organisation. Quoting Gary Hamel he said, only those employees will succeed who are "certified radical". Only those companies will succeed who create a cause, not a business. Leaders according to him are living individuals, whom people can smell, feel and touch. Their passion for work must be infectious.

1.2.5 Another aspect of leadership if the decision to introduce fun in the work place. Research shows that this reduces absenteeism and builds stronger, deeper and longer lasting relationships. It appears out of every 100 Fortune companies in the last decade, 69 are dead and only 31 are alive. In a Forbes Magazine study of around 100 companies from '17 to '87, only 39 companies were found to survive. Management of Change:-Research proves that many change models don't consider the human experience during change. The overriding concern seems to be to downsize. It was found that most change processes go through four fundamental stages.

People try to resist or deny change They adapt, participate in the change They attempt to add value The culmination or formation of a new status-quo

1.2.6 A number of presentations revealed that leaders who initiate change must do so with one foot in the future and the other planted in past values. Forgetting tradition must can devalue

existing strengths. The success of a change process depends on the skill of the facilitator to create a participatory process to enlist the support of people and address the issue of grief.

1.2.7 E-Learning :- Organisations like Ford Motor, Hewlett Packard, Intel and IBM are using e-learning to increase the knowledge of their people. Companies like Fordstar even manage time differences between countries while conducting virtual class rooms, chats, demos, presentations to communicate new concepts, product details, core values, issues of governance and corporate communities.

1.2.8 CEO's are talking to their people about new ideas and enlisting their support through forums and message boards. This is changing the way people behave and work. The advantages of e-learning are many: It is self-paced, flexible, less expensive, modular and has a huge reach.

1.2.9 Universities like Cornell, MIT, Stanford, etc, have started emphasizing e-learning to attract a worldwide audience. Web-centric universities are becoming the order of the day. William Taylor, editor and managing partner of the Fast Pace magazine, said, "There is no going back from back from dotcoms". He was of the opinion that there is a merger taking place between computers and human beings.

1.3 INNOVATIVE PRACTICES IN HR

1.3.1 The Innovative Practices in Human Resources study uncovered 12 practices that are reducing HR costs and improving service quality to employees. Key findings from this research included the need for HR managers to streamline processes, lower overhead costs, and enable their departments to advance from transactional organizations to strategic partners in the business.

1.3.2 Practices and technologies include:

Internet and intranet employee services Strategic human resources Centralized HR departments and call centers 360-degree performance appraisals HRIS systems Employee self-service Voice response systems (VRUs) Resume scanning and Internet recruitment Kiosks Automated time and attendance systems Team policies and development Outsourcing Business process reengineering (BPR)

1.4 LINKING PAY TO PERFORMANCE

1.4.1 Most Human Resource professionals are familiar with the concept of strategy. There is much more concentration and focus today on the strategic outcomes of human resource activity than ever before. The area of compensation is no exception.

1.4.2 Pay for performance systems are becoming more and more popular as senior managers reach beyond the use of compensation systems to deliver pay. There is far more interest in more closely linking the reward mechanisms to the achievement of corporate objectives. Motivation for superior performance is the goal.

1,4.3 In experience, most organizations will profess to a "pay-for-performance" philosophy as a keystone of their compensation system. Such a system requires solid grounding in a clear and documented link between performance and salary increases. Unfortunately, the link between individual performance and pay is frequently nonexistent - "merit" pay is a hollow concept in this regard.

1.4.4 A merit system demands that managers be willing to make distinctions in merit increases based on performance. However, several factors get in the way of this happening. First, the annual salary change is usually a small percentage. Giving the better performer 2% more than the cost of living has little motivation or recognition attached to it. Similarly giving the poor performers 2% less than the cost of living increase is not that much of a penalty. So many managers don't make that distinction - it is too much hassle. So everybody gets the same increase.

1.4.5 Second, most performance appraisal systems are after-the-fact appraisals. In other words, at appraisal time, which is usually toward the end of the year, managers are required to evaluate the performance of their staff. It means sitting down and trying to reconstruct what each staff member did, capturing it in a non-threatening way, communicating the evaluation without a fuss and finally, making a merit increase recommendation. Sound like a familiar pattern? It is a process that repeats itself year after year.

1.4.6 The end result is usually a lot of avoidance behavior. Managers avoid the appraisal process like the plague. Although employees profess to want to "know where they stand" they often take issue with the appraisal. Besides, they don't listen to the evaluation, they wait until the penny literally "drops". "What is my rating and how much do I get?" is a constant theme in merit systems where salary decisions are tied so closely with the appraisal process.

1.4.7 You might well ask is there any way out of this mess? The answer is fortunately yes. Organizations that are the best and want to separate themselves from the rest, are turning away from the merit system and toward an annual incentive system, particularly for middle and upper management positions but increasingly for teams and individuals lower down in the organization as well.

1.4.8 They are adopting a system of annual incentive bonuses linked directly to the achievement of corporate and individual objectives in three specific areas. The areas are corporate revenues and gains, cost containment and behavioral changes. The first two areas are quantitative and the

third area, which is gaining in importance, is qualitative in nature, and has a great deal to do with building managerial and individual competence.

1.4.9 Why Is This Transition Occurring? :-Well, there are many challenges facing businesses today and these challenges are driving them to find better ways of linking pay and performance to the achievement of corporate results..

1.5 CHANGING JOB DESIGN IN IT COMMUNITY

1.5.1 The California State University (CSU) system is being challenged to meet increasing demands for educational and administrative services through the innovative use of technology and human resource systems. Even though funding levels for higher education have been cut in recent years, public/taxpayer expectations and the demands for quality education, access, service, and accountability have grown. Technology initiatives within the CSU have resulted in significant advances and improved technical capabilities and efficiency. Human resource and organizational systems are also needed to capitalize on and thrive in this rapidly changing work environment.

1.5.2 In 1991, the CSU began a study to look at alternative work and job design approaches to meet these challenges. The study focused on the information technology community and how work processes and activities could be better organized to remove artificial barriers and improve organizational effectiveness, a process often associated with the term "reengineering." Secondly, the study focused on developing a job design approach that could adapt to changing skill requirements and that would promote the continuous acquisition of skills for knowledge-based employees in information technology. The goal of improved organizational effectiveness and an orientation towards reengineering and skills guided the development of the proposed job design approach.

1.5.3 This article begins by identifying several trends that led to the study, then describes the overall project within the context of an organizational effectiveness equation. A new job design approach that was proposed as a result of the study is presented, including a new classification structure and competency dimensions and measures for defining and evaluating positions. Finally, other supporting systems are described for an integrated human resources approach. The development phase of the project has been completed, and the CSU anticipates entering into negotiations with its employee representatives in the near future.

1.5.4 Three trends have had a direct impact on the development of a strategic job design approach for the information technology community at the CSU: (a) diversification and convergence of technology, increased demand for educational access and (b) changes in instructional delivery methods; and changing work place demands and priorities.

1.5.5 The technology demands within higher education lead to a complex and dynamic computing environment. Academic and administrative computing strategies tend to be at cross-purposes in terms of defining systems requirements. This has resulted in widely diverse systems and technology within and across the CSU's twenty campuses. Increasingly, however, campus systems are becoming more integrated, as data are shared across multiple platforms on a network

"highway" that is linked to external information sources. Networking and desktop computing have removed traditional boundaries for information access, research, and decision-support purposes. Data, voice, and video technologies continue to be combined in more interactive and user-friendly formats.

1.5.6 In terms of educational trends, many institutions offer distance learning using various transmission media and are incorporating instructional technology into curriculum development. Students expect guaranteed access to technology and to research databases, and this access has become an issue of social responsibility.[1] Library and computing functions are becoming increasingly interdependent in "an infrastructure of scholarly communication" within higher education.[2] Workplace trends, as presented in Sustaining Excellence in the 21st Century: A Vision and Strategies for College and University Administration, well represent the outlook for the CSU. Two key issues are identified:

(1) Economics. There is increasing pressure to constrain administrative costs within the "labor intensive cost structure" that exists in higher education. Reductions in staff are occurring at the same time as transaction volume and service expectations are growing.

(2) Decentralization of responsibility. With fewer people and greater access to information, organizations are moving responsibility for decision-making downward to the point of service. Work organization is shifting away from job specialization and a task/procedure orientation, to more generalized job responsibilities focused on outcome and greater participation on cross-functional teams

(3) Another central workplace trend is the "earning and learning" environment described by the U.S. Department of Labor in its Secretary's Commission on Achieving Necessary Skills (SCANS) report. To quote Thomas P. Foley, Secretary of the Pennsylvania Department of Labor and Industry:"We've changed from the idea of "one skill, one job" to the reality of a range of skills that have to apply to a number of different kinds of professions. More to the point, workers must possess a skill that they continually upgrade just to keep pace in the professions they choose."

(4) The influx of new technology and applications has created a demand for continual learning and adaptation. Due to the CSU's relatively stable workforce, maintaining skills to keep pace with changing technology was identified as a critical goal. Knowledge requirements are expanding to encompass a greater breadth of technologies and subject expertise, as well as including process-oriented capabilities such as communication and negotiation skills.

1.5.7 The implications of these technological , educational, and workplace trends point directly to the need to reengineer organizational structures, work design, and processes. Based on these trends and overall organizational goals, two key objectives were established for a new job design approach for the CSU: flexibility and skill development. Fundamentally, each campus needs the flexibility to achieve its goals by distributing work assignments in a way that optimizes its available skill mix and promotes individual skill development and initiative.

1.6 OBJECTIVES OF STUDY

1.6.1 Following were the objectives of the study:-

1. To enlist emerging HR trends in Indian IT Industry

2. To review literature and research done in this area.

3. To find out lacking areas regarding the HRD in IT sector.

4. To measure the perceptions of IT sector employees in respect of application of HRD in their organisation.

5. To suggest the measures to fill the gaps and improve motivation level of employees and HR management in IT industry.

1.7 RESEARCH METHODOLOGY

1.7.1 The study was exploratory in nature. All published and unpublished available on the subject matter was consulted. Interview and discussions were held with the various executive/ Managers/ staff employed in IT sector. The HRD functions/ activities being undertaken in different IT organisations were also studied. Primary and secondary data available with these organisations was also used for this project study.

1.7.2 In order to measure the employees perceptions of emerging HR trends in different IT organisation, the survey was undertaken. The survey was based on structured questionnaire. The questionnaire was mainly based on objective type close-ended question, but few open ended questions were also included.

1.7.3 Firstly, the pilot survey on ten randomly selected respondents was undertaken. Then the questionnaire was modified accordingly, if desired.

1.7.4 The final questionnaire was administered in person to the extent possible and through mail if needed. The 100 respondents were selected among the executives and staff working in various IT organizations. The convenient random sampling technique was used for the selection of the respondents.

1.7.5 Finally, the results of the survey has been presented in Tabular form, analyzed and interpreted to meet the required needs of this project study and presented in Report for

CHAPTER -2

HR TRENDS IN IT INDUSTRY2.0 HR IT SCENARIO

2.0.1 The web is altering the HRD landscape beyond recognition. The key to corporate

success in the fast changing information era is ‘thinking on your knees’.

2.0.2 What is this thinking on your knees? Normally as the HR person you know

what the situation is and operate from there. A repositioning is required in your

decision process with questions like why, how and when and not just what. At this

point you operate on your knee i.e. with far more dynamism and with a lot more

effectiveness than thinking on your feet.

2.0.3 The employees are like gypsies, on the move all the time. They camp at some

location, enhance their skills, responsibility levels and move on. This is

particularly true of the professional from Software Industry. Opportunities are

plenty and the next job opening is only a mouse click away. The question is not

about what else you can do to retain an employee but it is about making him

productive, while he is with you. The value addition will then happen for both the

employee as well as the employer resulting in a win-win situation. This means

that the new strategy calls for the recognition that no employee is expected to be

permanently with you. Normal tenure in any organisation is likely to be between

two to three years.

2.1 INNOVATION IS THE KEY

2.1.1 Information technology and Internet have changed several equations. Reaching

out to the world market place is no more the challenge in achieving corporate

victories. Out thinking the competition at electronic speed is the key to winning

corporate battles. The corporate success is sum total of entrepreneurship practiced

by your staff.

2.1.2 The key to employee longevity :-Today’s most successful organisations

recognize that to fuel growth and sustain a competitive advantage, they must make

recruiting, hiring and retaining top talent, as the organisation’s major thrust area.

Competent people deliver the rest don’t matter. Successful business organisations

have no choice but to promote the performers and let non-performers go.

2.1.2 Organisations recognize that that their ability to gather, manage, analyse,

distribute information and transform themselves into a learning organisation will

provide continuity and ensure for them their leadership role. Systematic

organizational learning should be central corporate philosophy. Learning, must be

obviously followed by changes, which may not necessarily be welcomed by

veterans in the organisation. But ‘change is the only Constant’ for guaranteed

success.

2.1.3 Points to note: The following points are important and must be properly

understood.

· People have a great deal of informational knowledge to contribute to the

organisation.

· People are responsible

· People desire opportunities to effect change, not just being expected to change.

· Organisations need to create awareness amongst their employees about their vision and

then empower them to act on that vision.

· Establishing a sense of urgency well ahead of the problem surfacing.

· Form inter-functional core group. Encourage the group to work together as a team.

· Plan and create short-term win targets – reward employees and recognise achievers.

· Consolidate improvements through a knowledge base driven system and institutionalise

proven new methodologies.

2.1.5 New Paradigms In HR

· Business plans must consider HR issues, focus and adapt.

· Corporate goals must factor in individual career growth and personal growth must be

tied to corporate growth and vice versa

2.1.6 Job responsibilities must facilitate personal development and learning should be

institutionalized with well-established knowledge bases. Capturing experience and

making it available ‘corporate wide’ should be a permanent feature of an organizations.

2.2 WAR FOR TALENT

2.2.1 The world’s most popular people resource base seems to be falling short of

numbers to meet its own demands. With added pressures of migration and

attrition, can India’s IT industry achieve its software and services revenue target

of $87 billion by 2008?

2.2.2 Country: India. Population: 1 billion-plus. If that sounds like too many people,

think again. Plug in English-speaking and low labor costs, and suddenly we can

envision $50-billion software exports target by the end of this decade. Not

impossible, if we consider the scarcity of IT manpower across the world. Take a

look at the US, already with a 10- million-strong IT workforce, which needs to fill

1.6 million new jobs in the next one year.

2.2.3 Japan is no different and estimates close to a million new jobs. Germany is looking

for 20,000 IT specialists and Italy is seeking 15,000 additional manpower. Their

choice destination—India.

2.2.4 Ironically, the country which has been such a popular people resource for the IT

industry the world over, is struggling with numbers to meet its own demand. To

meet the overall software and services (domestic and export) target of $87 billion

by 2008, according to the Nasscom-McKinsey report, the country will require a

minimum of 2.2 million knowledge workers for its domestic needs. This implies

that the present strength, which stands at 12,00,000 (December 2004), has to

increase about twice, not just in quantity but in quality as well.

2.2.5 According to industry estimates, majority of the demand for manpower will be in

the area of IT-enabled services. While Nasscom puts the requirement at

11,00,000, MIT says IT-enabled services and e-business will need 12,70,000

workers by 2007. Experts insist that since this sector does not require very highly

skilled manpower, we can easily meet this demand. "IT-enabled services is a

wonderful opportunity for India and for such services you don’t need highly

skilled professionals. You just need smart graduates who can speak English, all

you need to do is train them. For instance, in a call center, they need to be trained

on accents and customer services,"

2.3 4 R’s of HR in IT

Table 2.1

Recruiting Retaining Retraining Restructuring

Broad job

Signing bonus

Finders Fee

Alumni connections

Non-techs

Students

Interns

Retention bonus

Project pay

Reduct FTE/same pay

Telecommuting

Externs

Job sharing

Recognition programs

Job rotation

Team assignments

Skill inventories

Competency development

Certification

descriptions

Flexible compensation

programs

Flexible jobs

Positive problem-solving spirit

2.3.1 OBSTACLES

· Denial (This is and long term)

· Misalignment (Ramping up/Ramping down)

· Timing

· Treating everyone the same

· Navigating the bureaucracy

· Demographics

2.3.2 WHAT OTHERS ARE DOING

· Pooling recruitment efforts

· Increasing freedom at the dept level

(on-the-spot hiring, broadbanding, etc.)

· Recruiting/retaining students

· Identifying tech skills in all jobs/people(Skill Inventories/assessment)

· Sharing staff

2.3.3 RETENTION FACTORS

1. Quality of boss

2. Direction of department

3. Exposure to new technologies

4. Confidence in the company

5. Job security

6. Challenging work

7. Location

8. Access to capital resources

9. Caliber of co-workers

10. Empowerment

11. Department leadership

12. Ability to influence department success

2.3.4 TAKING THE LEAD

· See ourselves as problem-solvers

· Develop critical skills and competencies in ourselves, then others

· Build compensation around results not tasks; competencies, not seniority

· Involve everyone. Constantly align and balance resources to meet changing needs

2.3.5 SEARCH FOR TOMORROW

Attract, retain and reward the best performers (Encourage all to be the best) Increase flexibility Reduce fixed costs Reduce administrative effort (Simplify, simplify, simplify) Utilize the full range of individual talents

2.3.6 THE CRISIS

Ø Shortage of IT workers

2.3.6 COMPETITION

Ø Compensation stock options, profit sharing, incentives

Ø Alternatives outsourcing

2.3.7 ATTRACTING

Ø Recruiting sign on bonuses

Ø Relocation incentives

Ø Recruiters

Ø Reduced cycle time for hiring

Ø Campus/ job fairs / referrals/ internet

2.3.8 RETAINING

Ø Work environment

Ø Communication forums

Ø Telecommuting

Ø Flexible staffing

Ø Exciting projects

2.3.9 PRACTICES

Ø Focus on value

Ø Financial and human value

Ø Commitment to core strategy

Ø Linkage between culture an system

Ø Multi dimension communication

Ø Stakeholders partnerships

Ø Mutual support and collaboration ( teamwork)

Ø Risk and innovativeness

Ø Passion

2.3.10 DEVELOPING

Ø Internship programs

Ø Training programs

Ø Career development programs

2.3.11 LONG TERM SOLUTIONS

Ø Education, government, industry partnerships

Ø Curricula: technical skills and career skills ( teamwork and communication)

2.3.12 KEY SUCCESS FACTORS

Understand people

What they want

Long term perspective’

Innovative

Co ordinated approach

Career development I

2.4 OUT SOURCING

2.4.1 In the last few years, more and more companies around the world are looking

towards India for outsourcing their software requirements. The changing business

environment is demanding new applications. In particular, the spread of client-

server computing in decentralised organisations involves the development of

applications specific to a user's business.

2.4.2 Outsourcing is becoming a strategy for forward thinking IS managers. It is no

longer just a means for reducing costs, but a tool for adding value to business. It

enables organisations to concentrate on their core business, carry out business re-

engineering and provide information that is valid, timely and adequate to assist

decision making at the management level and quality and cost control at the

middle and lower levels.

2.4.3 As a result, outsourcing has gradually grown beyond the traditional idea of

"having a third party running the data centre". It has come to mean, "any use of an

outside contractor to replace or extend in-house resources".

2.4.4 Outsourcing is closely linked with corporate strategy, since it must support the

organisation's major initiative in using IS. It should enhance and add value to the

business. A rule of thumb to start and gain experience is, "if IS is low cost and of

high value addition, keep it within the organisation, i.e. in-source. If IS is high

cost and of low value addition, consider outsourcing".

2.4.5 In the past few years, whenever organisations around the world have outsourced to

India, the Indian software companies have substantially helped to cut costs in

software development projects or MIS environments, while maintaining high

quality. Moreover, all these cost and quality advantages are coupled with the use

of state-of-the-art technologies.

2.4.6 In 2004-05 more than US$ 2500 million worth of software development work

was outsourced to India (The total software exports from India during the year

was US$ 4085 million). This was 56% higher than outsourcing orders in 2003-04.

It is estimated that the quantum of outsourcing may jump to US$ 5 billion and

reach as high as US$ 10 billion by 2010 A.D.

CHAPTER - 3

HR PROBLEMS OF INDIAN IT PROFESSIONALS

3.0 OVERVIEW OF PROBLEMS

3.0.1 The IT revolution is sweeping the world, particularly the western world in for

nearly a decade now, creating enormous employment opportunities in this area.

India joined the bandwagon well in time and smoothly though it is yet to entrench

itself strongly in terms of corporate identity and significant share of global

revenues in IT.

3.0.2 Our main contribution seems to be in the less glamorous areas of value addition,

maintenance, Y2K, quality assurance and customisation of existing packages. The

sudden eruption of opportunities in this area left no time for development of

human resources in a planned manner and also software solutions which tended to

be more ad hoc than being assured of quality.

3.0.3 With the enormous opportunities for employment, entrepreneurship with low

capital investment and low gestation period for turning profitable, higher returns

per employee and large return on investment/EPS, sustained encouragement from

government, a very large number of organisations - large, medium, small - have

been established. Correspondingly a large number of training establishments and

cyber cafes have come up, most of which are in the cities and towns to cash in on

the enthusiasm of the urban middle class.

3.0.4 A number of higher level courses have also been started mainly through private

organisations besides the existing government (State/Central), university and

autonomous institutions. There are about 500 private engineering colleges besides

IITs, RECs, universities, colleges offering courses such as MCA, M.Sc., M.E.,

and M.Tech. In view of the apparent demand that appears to be exaggerated, most

of the programmes (barring a few by government institutions and IITs) are very

expensive, almost beyond the reach of a middle-class student. Yet candidates and

their parents strain themselves financially to pursue the courses hoping to get an

attractive job (financially) which remains a mirage by and large. The problems are

further compounded by a lack of proper teaching faculty in most colleges and

franchises.

3.0.5 Except in well-established institutions, job-placements are poor. Even those

trained in reputed institutions find their jobs monotonous, leading to depression.

Jobs offered by the software industry have demonstrated the above factors as they

are able to carry out the projects with persons of any background and levels of

attainment, but with a few months training either prior to employment or a short

training during probation.

3.0.6 Despite these deficiencies, students prefer software jobs mainly with an eye on

the pay-package and urban locations. The employee- retention period even in

good companies has been shrinking and is found to be three to six months. The

companies also try to devise methods to make their employees almost captive

with surety bonds, bank guarantees, employee's stock option (ESOP) and housing

facilities, among others. The employees, for their part, resort to innovative

methods to wriggle out of their contracts. There does not appear to be any

respectable ethics even among companies as well as the employees in this type of

free for all market. To go abroad and become rich has become the motive of most

of the employees even if the job does not offer any intellectual satisfaction. The

manufacturing and hard-core engineering sector has also shrunk in terms of job

opportunities and attractiveness.

3.0.7 Even those software professionals, who are offered good financial packages,

spend their earnings on expensive lifestyles, vehicles, and credit card syndrome

and find themselves disenchanted on all fronts including the intellectual front. It

should also be a cause for concern to project beyond the present software boom as

to what happens to all these if the opportunities decline. The scenario appears to

be quite fluid with a predominant western bias in all the activities concerning

software profession with scores of Indian boys getting lured and sucked into the

vortices created by the opportunities in this area

3.1 MAIN PROBLEM AREAS

3.1.1 The significant problem areas which may be contributing to the present scenario

and can be addressed can be identified as given in the succeeding paragraphs.

3.1.2 Recruitment process :-Without going into the deficiencies of the present

practices, the following suggestions are made to improve the process in terms of

efficiency, availability of manpower and equity to all the aspirants irrespective of

the fact where they got educated. The various steps of the proposed approach are

as follows:

i. Aptitude tests could be conducted by reputed institutes like IITs/ private

organizations/HR agencies for prospective professionals preferably ``on-line'' like

GRE, GMAT etc. or physically at regular intervals and scores are given. If it is no

on-line, the periodicity can be a month or two and the validity can be for an year

or so which can also be fixed based on general agreement.

ii. Based on scores and preferences of the candidates (career counselling),

companies can ask for a video clip for subsequent interview if required.

Interviews can also be conducted simultaneously either physically or over the

phone or by video conference and selections completed.

iii. Once selected and the candidate joins the organizations, all member organizations

should adopt a code of conduct such that the candidates stays at least for a period

of one year.

iv. Small companies can form some kind of a cooperative society wherein software

professionals' services can be tapped and steer clear and manpower shortage (less

than critical mass levels).

v. The selection can be conditional that he acquires certified skills in the required

areas either through training in house or through approved training agencies and

establishments. This will also avoid the unnecessary expenses for (which are

high) the candidates, who are presently spending lot of money with a hope of

employment. This will also ensure that there is a focus on proper training and

optimal deployment of time, effort and finances.

vi. The selection process can thus be continuous and commensurate with the

requirements thus avoiding idle inventory.

vii. There can be general norms of pay packages depending on the reputation of the

companies (classifying them as A, B, C, D by any reputed management institute

like IIM etc.) with the ratio of maximum pay within reasonable and realistic

limits.

3.1.2 Post employment care:- The companies/organizations should take adequate

interest in the career development of the employee by suitable HRD approaches

which should include the following:

i. Opportunities for creative work in the first phase particularly for those who are

bright, and have an aptitude and come with a good pedigree say from IITs.

ii. Opportunities to lessen the monotony and improve interpersonal relationship and

mixing and group activities.

iii. Periodic rotation of the rolls and jobs if possible.

iv. Opportunities for retraining and upgrading the skills.

v. Conducting effective career development programs regularly.

vi. Incentives like ESOP, lucrative assignments and challenging projects,

opportunities of higher education.

vii. Make the employee more versatile with wider perspective and flexible for easy

deployment in areas needing strengthening.

viii. Encouraging simplicity and excellence.

3.1.3 Advantages:- The suggested processes in 4 and 5 above can be expected to have

the following significant advantages:

i. Cost effective and efficient process.

ii. Proper deployment of skills optimally.

iii. Idle employment can be minimized.

iv. Retention can be improved.

v. Particularly useful for small firms which can also operate in the cooperative

society mode.

vi. The candidate's skills are moulded to suit the needs of the job and need not waste

time, money and efforts.

vii. Equitable opportunities to all aspirants irrespective of location, pedigree and

background.

viii. Reduces the mushrooms of training shops with inadequate faculty.

ix. This may also give the manufacturing and core engineering sector jobs reasonable

chance to attract willing and bright candidates.

x. The process is ideally suited for candidates to plan their careers with adequate

preparation in core areas.

xi. The process also enables a realistic assessments of needs and demands regularly

and meeting them even at short notices.

xii. The aptitude tests can become richer and more representative over a few years

and as the question bank becomes larger and random on-line questioning can be

introduced which is more objective like GRE, GMAT

3.2 LONG TERM PERSPECTIVE

3.2.1 These tests can be conducted at the end of 10+2 level or B.Sc. level also and train

the candidate with or without stipend in courses where he could get admission

for his degree. This will help in decreasing the pressure on engineering education

as otherwise the skills acquired by the candidate at a great cost in branches other

than computer sciences are wasted and lost for good if employed by the software

industry.

3.2.2 It may be a good idea to have a National Test for Software Talent similar to

science talent test which can be sponsored by NASSCOM and such other

interested groups

3.2.3 The idea of forming a cooperative society by small firms may prove to be

beneficial as the facilities and manpower can be shared optimally. While

otherwise they may face the problems of lack of adequate manpower (below the

critical mass level) because of less attractive pay and perks they are able to offer.

3.2.4 Renowned organizations like IITs, IIMs and MNCs, and can play a catalytic roll

in streamlining the processes for an efficient HRD in this vital area of software

manpower which is a national resource.

CHAPTER - 4

IT SECTOR COMPENSATION METHODS

4.0 EMPLOYEE STOCK OWNWERSHIP PLAN

4.0.1 Employee Stock Ownership Plan(ESOP): is a defined contribution employee benefit

plan that allows employees to become owners of stock in the company they work for.

4.0.2 How does ESOP work?

1. The ESOP operates through a trust, setup by the company, that accepts tax deductible

contributions from the company to purchase company stock

2. The contributions made by the company are distributed to individual employee

accounts within the trust.

3. The amount of stock each individual receives may vary according to pre-established

formulas based on salary, service, or position.

4. The employees may ‘cash out’ after vesting in the program or when they leave the

company. The amount they may cash out may depend on the vesting requirements.

4.1 STOCK OPTIONS

4.1.1 Stock Options: The ‘right’ to purchase stock at a given price at some time in the future.

Stock Options come in two types:

1. Incentive stock options (ISOs) in which the employee is able to defer taxation until the

shares bought with the option are sold. The company does not receive a tax deduction

for this type of option.

2. Nonqualified stock options (NSOs) in which the employee must pay income tax on the

'spread' between the value of the stock and the amount paid for the option. The

company may receive a tax deduction on the 'spread'.

4.1.2 How do Stock options work? An option is created that specifies that the owner of

the option may 'exercise' the 'right' to purchase a company’s stock at a certain

price (the 'grant' price) by a certain (expiration) date in the future. Usually the

price of the option (the 'grant' price) is set to the market price of the stock at the

time the option was sold. If the underlying stock increases in value, the option

becomes more valuable. If the underlying stock decreases below the 'grant' price

or stays the same in value as the 'grant' price, then the option becomes worthless.

4.2 MERIT PAY

4.2.1 Merit Pay is an incentive plan implemented on an institutional wide basis to give all

employees an equal opportunity for consideration, regardless of funding source. The

merit increase program is implemented when funds are designated for that purpose by

the institution's administration, dependent upon the availability of funds and other

constraints. .

4.2.2 Advantages OF Merit Pay :-

· Allows the employer to differentiate pay given to high performers.

· Allows a differentiation between individual and company performance.

· Allows the employer to satisfactorily reward an employee for accomplishing a task that

might not be repeated (such as implementation of new systems).

4.3 GAIN SHARING

4.3.1 Gainsharing is a technique that compensates workers based on improvements in the

company's productivity.

4.3.2 How does Gainsharing work? A Company shares productivity gains with the

workforce. Workers voluntarily participate in management to accept

responsibility for major reforms. This type of pay is based on factors directly

under a worker’s control (i.e., productivity or costs). Gains are measured and

distributions are made frequently through a predetermined formula. Because this

pay is only implemented when gains are achieved, gainsharing plans do not

adversely affect company costs.

4.3.2 What are the 'Gains' that are measured?

· Increases in production with equal or less effort.

· Equal levels of production with less effort.

4.3.3 What are examples of Gainsharing formulas?

· Calculate gain in hours: The actual hours worked minus the expected hours (for the

given level of output) equals the gain in hours.

4.4 PROFIT SHARING

4.4.1 Profit Sharing is an incentive based compensation program to award employees a

percentage of the company's profits.

4.4.2 How does Profit sharing work? The company contributes a portion of its pre-

tax profits to a pool that will be distributed among eligible employees. The amount

distributed to each employee may be weighted by the employee's base salary so

that employees with higher base salaries receive a slightly higher amount of the

shared pool of profits. Generally this is done on an annual basis

4.4.3 How to Choose an Employee Stock Plan for Your Company:-Many

companies we encounter have a pretty good idea of what kind of employee

ownership plan they want to use, usually based on specific needs and goals.

However, sometimes they might be better served by another kind of stock plan.

And yet others say they'd like to have an employee ownership plan, but they're not

sure what it might be. This article will start you down the path to choosing and

implementing the plan or plans best suited to your company.

4.5 ASSESSMENT OF PLANS FOR BROAD-BASED

EMPLOYEE OWNERSHIP

4.5.1 Let us begin by quickly reviewing the main possibilities for broad-based

employee ownership. A "broad-based" plan is one in which most or all employees

can participate.

4.5.2 An employee stock ownership plan (ESOP) is a type of tax-qualified

employee benefit plan in which most or all of the assets are invested in stock of

the employer. Like profit sharing and 401(k) plans, which are governed by many

of the same laws, an ESOP generally must include at least all full-time employees

meeting certain age and service requirements. Employees do not actually buy

shares in an ESOP. Instead, the company contributes its own shares to the plan,

contributes cash to buy its own stock (often from an existing owner), or, most

commonly, has the plan borrow money to buy stock, with the company repaying

the loan. All of these uses have significant tax benefits for the company, the

employees, and the sellers. Employees gradually vest in their accounts and

receive their benefits when they leave the company (although there may be

distributions prior to that). Over 8 million employees in over 11,000 companies,

mostly closely held, participate in ESOPs.

4.5.3 A stock option plan grants employees the right to buy company stock at a

specified price during a specified period once the option has vested. So if an

employee gets an option on 100 shares at $10 and the stock price goes up to $20,

the employee can "exercise" the option and buy those 100 shares at $10 each, sell

them on the market for $20 each, and pocket the difference. But if the stock price

never rises above the option price, the employee will simply not exercise the

option. Stock options can be given to as few or as few employees as you wish.

Perhaps 7 to 10 million or more employees in thousands of companies, both

public and private, presently hold stock options.

4.5.4 An employee stock purchase plan (ESPP) is a little like a stock option plan.

It gives employees the chance to buy stock, usually through payroll deductions

over a 3- to 27-month "offering period." The price is usually discounted up to

15% from the market price. Frequently, employees can choose to buy stock at a

discount from the lower of the price either at the beginning or the end of the ESPP

offering period, which can increase the discount still further. As with a stock

option, after acquiring the stock the employee can sell it for a quick profit or hold

onto it for awhile. Unlike stock options, the discounted price built into most

ESPPs means that employees can profit even if the stock price has gone down

since the grant date. Companies usually set up ESPPs as tax-qualified "Section

423" plans, which means that almost all full-time employees with 2 years or more

of service must be allowed to participate (although in practice, many choose not

to). Many millions of employees, almost always in public companies, are in

ESPPs.

4.5.5 Section 401(k) plan is a retirement plan that, unlike an ESOP, is designed to

provide the employee with a diversified portfolio of investments. Like an ESOP,

however, a 401(k) plan is a tax-qualified plan that generally must include all full-

time employees meeting age and service requirements. The employees can choose

among several or more choices for investments, and the company may make a

matching contribution. Perhaps several million employees in a few thousand

companies participate in plans with a heavy company stock component; company

stock may be an investment choice for the employees and/or the means by which

the company makes matching contributions. 401(k) plans may be combined with

ESOPs (these are called "KSOPs"), where the company match is an ESOP

contribution.

4.6 EMPLOYEE OWNERSHIP : COMPANIES PAY LESS FOR WORKERS'

COMPENSATION COSTS

4.6.1 A study has found that employee ownership companies have lower workers'

compensation insurance rates than comparable non-employee ownership firms.

Leslie Hakala authored the study. She began the project as an NCEO research

intern and completed it for a thesis requirement at Harvard University. The study

was unable to ascribe a specific causal relationship between employee ownership

and lower workers' compensation costs, but it did find that these costs declined as

employee ownership plans matured.

4..6.2 Background:- In 1989, the last year for which we have data, U.S. employers

spent over $48 billion on workers' compensation costs. These costs grew at

16.9% per year in the mid-1980s. Cost increases were partly attributable to

increased benefits mandated by state workers' compensation insurance

reforms. At the same time, as employer provided health care coverage has

declined, more employees sought to cover health problems under workers'

compensation. Many people believe there has been increased fraud as well.

4.6.3 Workers' compensation programs vary from state to state, but in most

programs, insurers attempt to provide employers with an incentive to limit

safety problems by developing an experience rating. The ratings compare an

individual firm's experience with other firms of its type. If the rating is better

than average, insurance premiums will be lower; if it is worse, they will go up.

4.6.4 In this study, we looked only at California firms. In California, employers

are assigned a "manual rate," an insurance rate expressed as a percentage of

every $100 of payroll. Rates are assigned to all companies based on their

industry classification. These rates are then adjusted for companies with a

premium above a certain level according to their actual experience. This

means smaller and less risky firms are not assigned an experience

modification rating. The experience modification rate is set for each year

based on three years of past experience, excluding the most recent year

(because data are generally not yet available). The experience modification

rate is determined by looking at actual experience modified by a size

weighting factor. For larger firms, the adjustment may be very small; for

smaller firms, actual experience is given a lower weight because a single

incident can skew results dramatically. This weighted experience rating now

becomes the "experience modification" figure.

4.6.4 Theoretically, the average experience modification factor for any business

classification should be 100%. A company with a good record would have a rating under

100%; a bad record would rate higher. These numbers are then multiplied by the

manual rate to set the premium. In practice, the average rating is somewhat under 100.

4.7 IT COMPANIES WRITE NEW ESOP STORY

4.7.1 Will I ever get to exercise my stock options? It's the one question haunting IT industry

professionals sitting on piles of employee stock options. All those who happily grabbed at

ESOP's issued by their companies last year, have now been left holding pieces of paper

that are, in some cases, worth a fraction of the price at which employees brought into

them. Except for a few who have benefitted from older schemes like Infosys 1994

scheme, the great ESOPs dream is turning out to be a nightmare. Last year, if you were

given ESOPs in an IT company, your friends, neighbours and everyone else went up like a

blimp, companies issued ESOPs in cartloads. And employees brought into them, even at

the higher prices that the grants came from.

4.7.2 According to a study carried out by Nasscom , there were more than 10,000 IT staff

last year holding around 18 million ESOPs valued at roughly Rs 12,000 crore($3 billion) at

February '00 prices. But all this was merely on paper.

4.7.3 A year later, the situation's something like this. Employees who were given ESOPs at

the prices prevailing during the IT boom, had to sit back and watch their share prices hit

the roof while they waited out the lock-in period. Now, they can exercise their options

that is sell them, and pocket the difference between the exercise price at the time of the

grant, and the current market price. It's resulted in a situation where employees have

been left holding NIIT options which they would have to exercise at a price of Rs 1,593 or

Silverline options, which they would have to exercise at a price of $25. At VisualSoft, for

instance, all employees who were granted options have returned them to the company.

Consequently, the company has terminated the ESOP scheme.

4.7.4 Theoretically, an employee who exercised his option now, would have to buy at the

exercise price, sell at the current market price, and pay out the difference.

4.8 ESOPs HARDLY BENEFICIAL -

4.8.1 At the height of the IT euphoria in the markets, those employees saw their

company's scrips scaling new heights, they could not benefit as the ESOP's had 1-2 year

lock-in periods, and could not be sold. The lock-in period, also known as the vesting

period in industry jargon, in the period during which the employee cannot convert his or

her option into shares. To make matters worse, some companies has specified that the

option had to be exercised, that is converted into shares, within a specified time frame

after the lockin period expired. For instance, this was one year in the case of Silverline,

and 10 in the case of Aptech.

Table 4.1

ESOP IN INDIAN CONTEXT

Recent ESOPs

No of

Shares

(Lakh)

Plan Exercise

Plans

(Rs)

Vesting

Period

(Yrs)

Current

Price

(Rs)

NIIT 18.1 Aug '04 1,593 1 162

Silverline 10.0 Nov '04 425 1.5-3.5 41

Patni 5.5 Dec '04 245* 1 54

HCL Infosys 30.2 Aug '04 289 NA 72

SSI 1.5 Sep '04 555 3 164

Wipro 3.5 Oct '04 2,397 1-2 1,485

Infosys 19.6 Oct '04 6,249 5 3,532

VisualSoft 0.2 Aug '04 NA 1 116

Polaris 8.5 Aug '04 480 5 120

4.9 EMPLOYEE STOCK PURCHASE PLANS (ESPPS)

4.9.1 Employee stock purchase plans (ESPPs) include both tax-qualified "423

plans," which about 2,400 companies offer, and nonqualified plans, which about

1,500 companies offer. Our estimates are based on data from ShareData's Equity

Compensation Trends in America (1991), Hewitt Associates' On Employee Stock

Ownership (1996), Hewitt Associates' Survey Findings: Employee Stock Purchase

Plans (1998), and the National Association for Stock Plan Professionals' Stock

Plan Design and Administration Survey (1998), especially the more recent

studies. To estimate the number of employees covered under the plans, we took

the total number of companies offering plans, multiplied those numbers by the

average number of employees in the companies (13,207 for 423 plans and 17,790

for nonqualified plans), and multiplied that number by the average percentage of

participation in the plans (34% for 423 plans and 17% for nonqualified ESPPs).

Almost all companies with ESPPs are public.

4.9.2 Multiple Plans: Many companies offer multiple e plans, and many

employees participate in more than one plan. For example, many ESPP

participants are also in 401(k), stock option, or other equity compensation plans.

Hence, the total number of participants in all these plans is definitely not the total

of the numbers in the "Number of participants" column.

4.10 ESOPS AND CORPORATE GROWTH

4.10.1. A 2000 study by Joseph Blasi and Douglas Kruse at Rutgers Univerity found

that ESOP companies grow 2.3% to 2.4% faster than would have been expected

without an ESOP for sales, employment, and sales per employee. The study

looked at all ESOP plans set up between 1988 and 1994 for which data was

available. A 1987 NCEO study of 45 ESOP and 225 non-ESOP companies found

that companies that combine employee ownership with a participative

management style grow 8% to 11% per year faster than they would otherwise

have been expected to grow based on how they had performed before these plans.

4.10.2 Subsequent studies by the General Accounting Office and by academics in

Washington State and New York found the same relationship. A 1999 study for

Hewitt Associates by Hamid Mehran of Northwestern University found that the

returns on assets for 382 publicly traded ESOP companies was 2.7% per year

greater than what a model of their predicted performance would have been.

4.10.3 Studies on participative management alone find a small positive impact on

performance, but not nearly enough to explain the synergy between ownership

and participation these other studies have found.

CHAPTER – 5

SURVEY ANALYSIS

5.0 SURVEY BACKGROUND

5.0.1 HR management gets best out of its employees to meet the organisation's goals.

And employees are the best judge of the HR policies of any organisations. IT

sector is fastly growing industry in India and HR requirements of Indian IT

Industry are quit different from traditional industrial sectors.., A major

characteristic of modern socio-economic development has been the increasingly

dominant role of service sector .and IT belongs to service sector. So, its HR needs

must also be properly identified..

5.0.2 Indian IT sector is contributing a large in employment and foreign exchange. A

developing country like India can ill afford continued conflict ridden; rigid and

litigation oriented Industrial Relations. What employees perceive about the

emerging HR trends of the IT organisations has been measured.

5.0.3 To measure the success and failures of emerging HR trends of Indian IT Industry a

structured questionnaire was designed for this purpose. The questionnaire

included both open ended and close ended questions. The questionnaire used is

placed at Appendix "I". The procedure adopted for data collection was

interview with the employees randomly selected from IT organisations to the

extent possible and also through mail. . The responses given by the respondents

were recorded on the questionnaire. The views expressed by the respondents has

been analysed in the succeeding paragraphs. About 100 respondents were selected

by convenient random sampling technique.

5.1 RESPONDENTS PROFILE

5.1.1 The main features of the employees randomly selected sex-wise,

education-wise and type of functions wise has been provided here in the

succeeding paras. The 54 per cent of the respondents were Male and 46 per

cent of the respondents were Female

5.1.2 IT industry requires higher level of education standards, both non-technical and

technical. The education qualification wise distribution of the employees who

agreed for responding to our questionnaire has been given below in Table 5.1.

Table 5.1

RESPONDENTS PROFILE - EDUCATION-WISE

(%age)

Respondents' Qualification Percentage Of Respondents

Non-Tech Graduate and Below 11%

Non-Tech Post Graduate 23%

B.Tech/ BCA etc. 34%

M.Tech/MCA Etc. 32%

TOTAL 100%

5.1.3 In the similar fashion the job wise profile of the respondents has also

been compiled and the same is tabulated below in the Figure 5.2. As per Figure

the IT industry is dominated by the software professionals And next computer

hardware and marketing services of IT are sharing the other half. Only 13 percent

are working in HR and Personnel Management area. Hence, the HR needs of IT

industry must look after the software professionals at priority.

5.2 WHETHER HR NEEDS OF INDIAN IT INDUSTRY ARE

DIFFERENT

5.2.1 Through the Question No.2 of the questionnaire the respondents were asked to

comment whether the HR needs of Indian IT industry are different from traditional HR

Management systems. It was a direct question in Yes/NO/No comments format and IT

professionals selected for survey were asked to tick one of the choices as mentioned. The

responses have been tabulated in Table 5.3. The majority of respondents (69%) view that

HR needs of IT industry are different from old economy sector and HR managers in IT

industry has to keep this into mind. Being highly educated employees are very sensitive

in pride and behaviour.

TABLE-5.3

Emerging HR TRENDS OF INDIAN IT INDUSTRY

ARE DIFFERENT

(%age)

Respondents' Observation

Percentage Of Respondents

Yes 69%

No 23%

Can not say 08%

TOTAL 100%

5.3 EFFECT OF NEW COMPENSATION METHODS

5.3.1 The IT industry has been devising newer compensation methods like Profit

Sharing/ Stock Options etc. to increase employee welfare and retentively.

Whether these new compensation techniques are positively effecting or not

was the key point in our next question. As per Figure-5.4, 46% of the

employees opined that newer compensation methods has a positive effect in

IT industry while 19% said that it has a negative effect on employee

welfare. 26% view that it has no major effect and 9 percent has replied in

CAN NOT SAY. . In the initial stages when IT Industry was sunrise it was

mostly welcomed by the employees and when IT industry share prices has

gone down. It has a negative effect..

5.4 WHETHER IT INDUSTRY HAS POSITIVE ATTITUDE

TOWARDFS ITS EMPLOYEES

5.4.1 In has been found that in many organisations the management ignores the

employees welfare for their profit sake and does not give proper attention towards

employees career and prospects. What is the state of affairs in IT Industry in India

was quizzed from our valued learned respondents. The respondents views are

given below Table 5.5. The results are mixed one. While 48% of the respondents'

replied in negative and 43% gave a positive reply. So, there is a profit motive

operating more than employees proper welfare management in Indian IT Industry.

TABLE - 5.5

WHETHER IT INDUSTRY HAS A POSITVE

ATTITUDE TOWARDS ITS EMPLOYEES

(%age)



Yes 43%

No 48%

No comments 09%

TOTAL 100%

5.5 STATE OF GRIEVANCES HANDLING IN INDIAN IT

INDUSTRY

5.5.1 The respondents responses to the status of grievances handling mechanism was

through an indirect approach. In the Question No. 5 of the questionnaire the

respondents were to comment upon the positive hypothesis that grievance

handling is done properly in the IT organisation. The five choices provided were

strongly agree, agree, no comments, disagree and strongly disagree. The data

collected is given below in Table-5.6.

TABLE - 5.6

GRIEVANCE HANDLING IN

INDIAN IT INDUSTRY IS PROPER

(%age)



Strongly Agree 12%

Agree 39%

No Comments 14%

Disagree 26%

Strongly Disagree 09%

TOTAL 100%

5.5.2 Only 12 respondents strongly agree to the statement and similarly a small number of

9 respondents strongly disagreed with this. Only 14 percent have nothing to

comment. 39 percent agree that The grievance handling IN Indian IT industry is

done properly and remaining 26 percent disagree with it.

5.6 TOP MANAGEMENT AWARENESS

5.6.1 Whether top management awareness about working conditions of the employees

and state of working conditions in the organisation was measured through next

question. Table-5.7 shows the response. 65% of the respondents view that the

top management's are not aware or little aware about the employees working

conditions in the IT organisations Only 6 percent vouched that top

management is very well aware about the nature of working conditions and 18

percent say "Much Aware".

Table 5.7

TOP MANAGEMENT AWARENESS

(%age)

Respondents'

Observation

Percentage Of

Respondents

Not at all aware 20%

Very little aware 45%

Some what aware 11%

Much aware 18%

Very much aware 06%

TOTAL 100%

5.7 EMPLOYEE EMPLOYER RELATIONSHIP IN IT

INDUSTRY

5.7.1 Cordial employee employer relationship is very essential in the upcoming

highly competitive economy. The state of employee employer relationship

in Indian IT Industry was measured through the next question. The state

of employee-employer relationship is not very encouraging.

Table 5.8

STATE OF EMPLOYEE EMPLOYER

RELATIONSHIP IN IT INDUSTRY

(%age)

Respondents Grading Percentage Of Respondents

Excellent 14%

Very Good 44%

Satisfactory 28%

Poor 14%

TOTAL 100%

5.7.2 58 percent of the respondents has graded it very good and above. While 42

percent consider it satisfactory and below. The employment of modern

technology requires more positive and effective relationship between

management and the employees. Indian IT Industry has very effective employee

employer relationship.

5.8 EMPLOYEES RETENTIVITY IN INDIAN IT

INDUSTRY

5.8.1 The most of the employees of IT sector are highly educated and sensitive in nature.

Moreover, the opportunities outside are very attractive, Whether Indian IT

Industry is able to retain its employees was the next opinion query from the

randomly selected IT industry employees. Their opinions in this regard are

presented below in "YES/NO/NO COMMENTS" format in the Figure 5.9.

5.8.2 61% of the employees view that Indian IT companies are unable to retain its

employees due to most attractive avenues outside. Only 23% viewed that they

are able to retain the employees.

5.9 HOW TO INCREASE EMPLOYEES RETENTIVITY

IN INDIAN IT INDUSTRY

5.9.1 As has been observed in general and also concluded in previous paras that the IT

sector employees in India are very quickly jumping the employment. So, what the

employers has to do for retaining its professionals was asked from the

respondents. Few suggestions were listed and one column was open ended to

express their any other suggestion. The Table 5.10 list outs all the suggestions. I

TABLE- 5.10

SUGGESTIONS FOR INCREASE RETENTIVITY


Respondents' Suggestions Percentage Of Respondents

Increase wages to international levels 22%

Increase foreign postings 36%Increase profit sharing 10%

More promotions 11%

Others 21%TOTAL 100%

(%age)

5.9.2 A 22% of the respondents has suggested to increase the wages to

international level to increase employees retentively in Indian IT industry. 36%

want more foreign postings, 10% suggest increase profit sharing and 11%

suggested more promotions. 21% of the other suggestions included lateral

induction from lower the institutes and better HR management.

5.10 APPLICABILITY OF EXISTING INDIAN LABOUR

LAWS IN INDIAN IT INDUSTRY

5.10.1 "Existing Indian labour Laws/Rules are not strictly applicable to Indian IT

Industry as IT sector employees are quite different from general factory workers

and are well educated and trained. The separate Labour to whether as a

Laws/Rules should be designed for IT Industry:. This hypothesis was presented

to the respondents. They were to respond upto which extent they agree or

disagree. The employees responses have been tabulated below in the Table 5.11.

The comfortable majority of respondents (89%) strongly agree or agree with the

hypothesis that Indian IT sector requires separate labour management system/

regulations. While only minority of 13% has given divergent views. Low

TABLE-5.11

INDIAN IT INDUSTRY REQUIRE

SEPARATE LABOUR LAWS/ RULES

(%age)

Respondents'

Observation

Percentage Of

Respondents

Strongly Agree 57 %

Agree 32 %

No Comments 02%

Disagree 07%

Strongly Disagree 02%

TOTAL 100%

5.11 EFFECTIVENESS OF OLD AGITATIONAL

METHODS IN IT INDUSTRY

5.11.1 Whether IT industry can afford old traditional trade union methods of agitations like Strike or Gherao etc. was also asked from the employees. The question was direct in nature of Yes or No. As has been listed in Figure 5.12 below, 67% of the respondents has given their reply in No and 28% answered in affirmative. 5% has ticked No Comments choice. So, it is concluded that old agitational techniques of trade unions are not desired in IT industry.

5.12 EFFECT OF EXCESSIVE COMPETION IN INDIAN IT

INDUSTRY

5.12.1 Whether excessive competition in Indian IT sector is harming the overall long term

prospects of employees in this sector The respondents opinion is tabulated below

in Table 5.13. The table above clearly indicates that excessive competition is

observed as harmful to the employees prospects. . 53 percent of the respondents

has replied in Yes to this question. While 35% has a negative viewpoint.

TABLE - 5.13

EXCESSIVE COMPETITION IS HARMING

EMPLOYEES LONG TERM WELFARE

(%age)



Yes 53%

No 35%

No Comments 12%

TOTAL 100%

5.13 ROLE OF TRADE UNION IN IT INDUSTRY

5.13.1 The respondents were asked to comment upon whether Indian IT Industry needs a

trade union or management's are looking after the employees interest in the best

possible manner. The Table 5.14 shows the responses in this regard.

Table 5.14

ROLE OF TRADE UNION IN IT INDUSTRY

(%age)

Respondents Grading Percentage Of Respondents

No Trade Union 21%

Single Trade Union 13%

Multi Trade Union 09%

Only welfare association 57%

Total 100%

5.13.2 The largest 57 percent of the respondents view that there should be only welfare

association in Indian IT industry. 21% need no trade union and 13% like single

trade union only.. 9 percent of the respondents opted for multi trade union.

5.14 OVERALL ASSESSMENT OF EMERGING HR

TRENDS IN INDIAN IT INDUSTRY

5.14.1 In the end respondents were asked to give their overall assessment/ grading of

emerging HR trends in Indian IT Industry. The overall assessment on five point

scales of excellent, very good, good, satisfactory and poor is tabulated below in

the Table 5.15. 65% of the respondents were in positive grading of excellent,

very good and good. While 35% gave a assessment of satisfactory and poor

CHAPTER - 6

SUMMARY AND CONCLUSION

6.0 OVERVIEW

6.0.1 The era of skill-based workers has arrived but if India wants to truly move to the global arena, it has to spruce up its workforce. Small may be beautiful, but not in the IT industry. In the knowledge era and a skill-based economy, it has become imperative that human resources become one of the most essential ingredients of success. The growth of IT companies worldwide depends on its people and the intellectual capital it possesses.

6.0.2 ‘Knowledge workers’ has become a buzzword in today’s IT scenario. And if we look at the top software exporters, they have been growing phenomenally in workforce strength. To make it

big in the global software market, India needs to increase its mass of knowledge workers. The establishment of Indian Institutes of Information Technology is definitely a step ahead in the right direction, but what the industry needs is experts in niche areas, in other words, persons with domain expertise. In the era of cutting-edge technologies, it is this skilled workforce that will make all the difference.

6.0.3 The total human resource strength of the IT industry as a whole stands at 425,609. A company-wise break-up of this figure reveals that nearly 525 companies constituting 35% of the IT industry employ an average of 58 persons each, 750 companies constituting 50% of the industry employ an average of 275 persons each, and 150 companies constituting 10% of the industry employ an average of 726 persons each. At least 40 companies have more than 1,000 employees, while some very big companies like TCS, Wipro, HCL and Infosys have staffs above 5,000 each.

6.0.4 Despite having abundant English-speaking skilled workforce, an acute shortage of skilled workforce will affect the country’s software exports in the long run, if remedial actions are not taken immediately.

6.0.5 Geometrical growth of Information Technology in the world as well as India, has created lot of revenues for government and number of avenues for employees. The introduction of computers has changed the way of life every where, including work places and our homes. The life has become quite fast and speed of provisioning of different services has also increased. But all this activities are being managed by number of well qualified professionals. They may be from computer hardware developers, software engineers or marketing managers. As the things are running fast, so they have to be managed fast.

6.0.6 These fastness of services and higher level of education/training standards are not easy to manage by the organisations concerned. As we already know that Human Resource Management of the organisation deals with the individuals putting their hardwork to meet the organisations goals. Managing people is the toughest element of any organisation than land, machinery or finances. Every human beings has its own degree of preferences, likings and attitude. So, HR managers has to take care of all these things in mind while dealing with the number of people working in the organisation.

6.0.7 Different type of employees/workers recruited for different level of working has to be managed in different styles. The hundreds years of organisational management experience has been converted into a standard personnel management and industry and service organisations are following these HR techniques for their organisational management. Due to availability of written down procedures and rules by the learned managers, it was felt that HR managing was not so typical.

6.0.8 But, emerging HR trends of Information Technology industry can not be managed properly by the old traditional HR techniques . As it is commonly known that man learns by experience. 50 years of introduction of computers has provided us the areas to be additionally addressed by the HR managers in IT sector. Indian IT industry is not an exception. Moreover, due to existence

of old conservative .and protective labour laws it is not possible to meet the ever-growing international competition in the IT services.

6.0.9 Hence, the IT industry has been devising newer Personnel Management/ HR techniques which specifically meet the needs of IT industry. The main reason for this is high standards of education and professional training required for this industry. Secondly, there is excessive job demands for developed countries in this sector and high wage standards. So, HR managers mainly in developing countries like India find it very difficult to retain and recruit their manpower. HR managers worldwide has devised handsome compensation methods like Profit Sharing, Employee Stock Option Schemes ESOP etc. Though over the period few schemes has flopped like ESOP due to heavy fall in company share prices.

6.1 RESPONDENTS OBSERVATIONS

6.1.1 As given out in Chapter 1, the employees opinion survey regarding status of HR management in Indian IT Industry and success of emerging HR trends was conducted through the use of a structured questionnaire. The survey was conducted by randomly selecting 100 persons working in Indian IT Industry. The respondents observations in this respect are described in brief in the following paragraphs

6.1.2 The 54% of the were Male and 46 per cent of the respondents were Female. It was observed that IT industry is dominated by the software professionals (46%), computer hardware and marketing services of IT are sharing the other half.

6.1.3 The respondents were asked to comment whether the HR needs of Indian IT industry are different from traditional HR Management systems.. The majority of respondents (69%) view that HR needs of IT industry are different from old economy sector and HR managers in IT industry has to keep this into mind.

6.1.4 The IT industry has been devising newer compensation methods like Profit Sharing/ Stock Options etc. to increase employee welfare and receptivity. 46% of the employees opined that newer compensation methods has a positive effect in IT industry while 26% said that it has a negative effect on employee welfare.

6.1.5 As per 48% of the respondents IT organisation has more concern for profit motive than employees welfare. While 43% were not agree to this proposition

6.1.6 51 percent of the respondents strongly agree/agree to the statement that grievance are handled properly in the Indian IT industry. While 33% think otherwise.

6.1.7 Whether top management awareness about working conditions of the employees and state of working conditions in the IT organisations, 65% of the respondents view that the top management's are not aware or little aware about the employees working conditions in the IT organisations . Only 4 percent vouched that top management is very well aware about the nature of working conditions and 16 percent say "Much Aware".

6.1.8 Cordial employee employer relationship is very essential in the upcoming highly competitive economy. The state of employee employer relationship in Indian IT Industry was measured through the next question. The state of employee-employer relationship is very encouraging. 58 percent of the respondents has graded it very good and above. While 42 percent consider it satisfactory and below.

6.1.9 Whether Indian IT Industry is able to retain its employees was the a query from the randomly from IT industry employees. 61% of the employees view that Indian IT companies are unable to retain its employees due to most attractive avenues outside . 22% of the respondents has suggested to increase the wages to international level to increase employees retentivity in Indian IT industry. 36% want more foreign postings, 10% suggest increase profit sharing and 11% suggested more promotions. 21% of the other suggestions included lateral induction directly institutions and better HR management.

6.1.10 Existing Indian labour Laws/Rules are not strictly applicable to Indian IT Industry as IT sector employees are quite different from general factory workers and are well educated and trained. The separate Labour Laws/Rules should be designed for IT Industry:. This hypothesis was presented to the respondents. The majority of respondents (89%) strongly agree or agree with the hypothesis that Indian IT sector requires separate labour management system/ regulations. While only minority of 11% has given divergent views. Further, 67% of the respondents has opined that old agitational techniques of trade unions are not desired in IT industry.

6.1.11 Whether excessive competition in Indian IT sector is harming the overall long term prospects of employees in this sector . 53 percent of the respondents has replied in Yes to this question. While 35 percent has a negative viewpoint..

6.1.9 The largest 57 percent of the respondents view that there should be only welfare association in Indian IT industry. 21% need no trade union and 13% like single trade union only.. 9 percent of the respondents opted for multi trade union.

6.1.10 In the end respondents were asked to give their overall assessment/ grading of emerging trends of Indian IT industry. The overall assessment on five point scales of excellent, very good, good, satisfactory and poor. 65% of the respondents were in positive grading of excellent, very good and good. While 35% gave a assessment of satisfactory and poor

6.2 CONCLUSION

6.2.1 Hence, it can be concluded that Emerging HR trends of Indian It industry are quite different from the old economy industry. India is considered one of Super Power in Information Technology and allied fields. Majority of world leaders in IT sector are outsourcing their requirements from Indian IT Industry and recruiting Indian IT professionals. Hence, the Indian Government must allow the Industry to meet international competition and desired environment in respect of Labour Laws and financial rules must be liberalized for this Indian IT Industry. Moreover, HR managers in Indian IT Industry must keep the sensitive nature of IT professionals and state of greater opportunities outside in mind for devising HR policies for their organisations

China is also entering this area vigorously and Government of India must help Indian It industry to meet this challenge.

APPENDIX "I"

QUESTIONNAIRE FOR

PROJECT STUDY ON EMERGING HR TRENDS


Dear Sir/Madam,

I am a management student of Fore School of Management. As part of course I a undertaking this project study. I would a request you to kindly answer a few questions. This questionnaire gives you the opportunity to express your opinion regarding various aspects of emerging HR trends in Indian a new IT Sector.

As a a you are all aware that Information Technology (IT) industry is achieving a great success in Indian employment context. As you are to a part of IT industry and must be observing that the HR trends of IT sector are quite different from the conventional old economy sectors.

The results shall be submitted to the university in the report format for the usage of researchers and other concerned authorities. As is the case for entire study, no individual will be identified. Only group averages will be reported.

Thanking You

Date .....

Personal Profile of the Respondent

1. (a) Place of survey..................................

(b) Name.............................................

(c) Address...........................................

(d) Male/Female.......................................

(e) Educational qualifications:

(i) Non Tech Graduate or below

(ii) Non-Tech Post-Graduate

(iii) B.Tech/BCA etc.

(iv) M.Tech/MCA/MBA

(f) Your Nature of Job:

(i) Computer Hardware

(ii) Computer Software

(iii) Marketing Services of IT

(iv) HR/ Personnel management

2. Whether you feel that HR needs of Indian IT sector are different from old HR practices.(Please Tick)

(i) Yes

(ii) No

(iii) Can Not Say

3. Whether new compensating methods being adopted by the various IT companies are positively effecting the employees welfare?

(i) Positive Effect

(ii) Negative Effect

(iii) No Effect

(iv) Can Not Say

4. "Indian IT sector companies has a positive attitude towards its employees and are not neglecting their welfare and prospects for their profit sake." Do you agree with the statement.

(i) Yes

(ii) No

(iii) No Comments

5 "The grievances of the employees in Indian IT sectors are handled properly". To what extent do you with this statement.

(i) Strongly Agree

(ii) Agree

(iii)No Comments

(iv) Disagree

(v) Strongly Disagree

6. How much do you think the top management of your organisation is aware of the working conditions of its employees?

(i) Not at all aware

(ii) Very little aware

(iii) Somewhat aware

(iv) Much aware

(v) Very much aware

7. What is the state of employee employer relationship in Your Organisation

(i) Excellent

(ii) Very Good

(iii) Satisfactory

(iv) Poor

8. The most of the employees of Indian IT sector or highly educated and sensitive in nature. Moreover, the opportunities outside are very attractive, Whether Indian IT Industry is able to retain its employees.(Please Tick)

(i) Yes

(ii) No

(iii) Comments

9. What the HR managers of Indian IT sector should do to increase the retentivity rate of its employees (Please Tick)

(i) Increase wages to international level

ii) Increase foreign postings

iii) Increase profit sharing

(iv) More promotions

(v) Any other(please specify) __________________________

10. "Existing Indian labour Laws/Rules are not strictly applicable to Indian IT Industry as IT sector employees are quite different from general factory workers and are well educated and trained. The separate Labour Laws/Rules should be designed for IT Industry:. Do you agree with this proposition.

(i) Strongly Agree

(ii) Agree

iii) No Comments

(iv) Disagree

(v) Strongly Disagree

11. Whether old methods of employees association/trade union like strike or Gherao etc. are desirable in Indian IT Sector (Please Tick)

(i) Yes

(ii) No

(iii) No Comments

12. In your view whether excessive competition in Indian IT sector is harming the overall long term prospects of employees in this sector.

(i) Yes

(ii) No

(iii) No Comments

13. Whether do you feel there is any roll of trade union in the IT Industry?

(i) No Trade Union

(ii) Single Union

(iii) Multi Union

(iv) Only welfare association

(iv) Can not say

14. Give your overall assessment of HR Management in Indian It Industry.

(i) Excellent

(ii) Very Good

(iii) Good

(iii) Satisfactory

(iv) Poor

15. Please give your comments and suggestions to bring further improvement in HR Management in Indian IT Industry.

Thank You,

B I B L I O G R A P H Y

1. Burack, E.R. & Mc. Nicholos, T.J. Human Research Planning: Technology, Policy and & Change, The Comparative Administration Research Institute of the Centre for Business and Economic Research, College of Business Administration, Kent State University, 1973.

2. Coch, Lester and John R.P. French, "Overcoming Resistance to Change," Human relations, Vol. I, 1948, pp. 512-532.3. Douglas, Paul.H. & Aaron, Director. The Problem of Unemployment, Macmillan, N.Y. 1931.

3. Edwards, John et.al., "Manpower Planning", John Wiley, New York..,1983

4. Gelden, P Stevan," Report Writing for Business and Industry", Business Communication Service.

5. Kothari, CR." research Methodology Methods and techniques", Wiley Eastern Limited.

6. Lawler III, Edward E., "Control Systems in Organizations," In Handbook of Industrial and Organizational Psychology, (Rand-Menally, 1976).

7. Mustafi, CK 1981. "Statistical Methods in Managerial Decisions, Macmillon New Delhi.

8. Pareek, U and T.V.Rao, 1981, "Designing and Managing Human Resource Systems", Oxford and IBH Publishing Co., New Delhi.

9. Ramaswamy, E.A. & Uma Ramaswam. "Industry and Labour", Oxford Press: New Delhi, 1981.

10. Rao, T.V. and Abraham, E.A.," A Survey of HRD Practices in Indian Industry, in Rao, T.V. and Pereira, D.F., Recent Experiences in HRD, New Delhi, Oxford & IBH, 1985.

11. Robertson, J. et.al. "Structure and Employment Prospects of the Service Industries", Department of Employment, Australia, 1982.

12. Shadecor George W, " Statistical Methods" The IOWA State University Press, AMES, IOWA, USA (6th edition)

13. Silvera, D.M., "Human Resource Development", 1988, The Indian Experience.Higher Education and IT:

14. Ehrmann, Stephen C. "Reaching Students, Reaching Resources: Using Technologies to Open the College." _Academic Computing_, April 1990, pp. 10-34.

15. Penrod,James I., and Michael G. Dolence"Concepts for engineering Higher Education." _CAUSE/EFFECT_, Summer 1991,

16. 5 Mark J. Wallace, Jr., "Rewards and Renewal: Competitive Advantage through Workforce Effectiveness," Paper presented at American Compensation Association National Conference, Anaheim, California, 1993.

17. Helen Murlis and David Fitt, "Job Evaluation in a Changing World," _Personnel Management, May 1991, pp. 39-43.

Project Report on Advertising Effectiveness

Project Report Advertising/Advertisement Effectiveness, What is Advertising, promotion of ideas, Basic Features of Advertising, goods advertised, Functions of Advertising, new product features, Promotion of sales, new product awareness, Consumer advertising, Comparative advertising

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Role of Advertising Effectiveness on Consumers, Most popular slogan, Sales of Coca Cola Cold drinks, Brands of Pepsi, Sales of Pepsi Cold drinks, effective media of advertisement

Ad. Effectiveness, TV is most effective media of advertisement, advertisement effectiveness of cold drinks, making the advertisement, sale of cold drink, advertisement effect the consumers, Coca Cola, Pepsi, Fanta, Mirinda, Maaza, Pepsi, improvement in present advertisement

Project Report on Advertising Effectiveness

The objectives of all business are to makes profits and a merchandising concern can

do that by increasing its sales at remunerative prices. This is possible, if the product

is widely polished to be audience the final consumers, channel members and

industrial users and through convincing arguments it is persuaded to buy it. Publicity

makes a thing or an idea known to people. It is a general term indicating efforts at

mass appeal. As personal stimulation of demand for a product service or business

unit by planting commercially significant news about it in a published medium or

obtaining favourable presentation of it upon video television or stage that is not paid

for by the sponsor.

On the other hand, advertising denotes a specific attempt to popularize a specific

product or service at a certain cost. It is a method of publicity. It always intentional

openly sponsored by the sponsor and involves certain cost and hence is paid for. It is

a common form of non- personal communication about an organisation and or its

products idea service etc. that is transmitted to a target audiences through a mass

medium. In common parlance the term publicity and advertising are used

synonymously.

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http://www.allprojectreports.com/MBA-Projects/Marketing-Project-Report/advertisement-effectiveness-cold-drinks-project-mba/research-coca-cola-pepsi-project-ch2.htm

What is Advertising :

The word advertising is derived from the Latin word viz, "advertero" "ad" meaning

towards and "verto" meeting towards and "verto" meaning. "I turn" literally specific

thing".

Simply stated advertising is the art "says green." Advertising is a general term for

and all forms of publicity, from the cry of the street boy selling newspapers to the

most celebrate attention attracts device. The object always is to bring to public

notice some articles or service, to create a demand to stimulate buying and in

general to bring logethel the man with something to sell and the man who has

means or desires to buy".

Advertising has been defined by different experts. Some of the quoted definition

are :

American marketing association has defined advertising as "any paid form of non

personal presentation and promotion of ideas, goods or services by an identified

sponsor. The medium used are print broad cast and direct.

Stanton deserves that "Advertising consists of all the activities involved in

presenting to a group a non- personal, oral or visual openly, sponsored message

regarding a product, service, or idea. This message called an advertisement is

disseminated through one or more media and is paid for by the identified sponsor.

Advertising is any paid form of non – personal paid of presentation of ideas goods

or services by an identified sponsor.

Advertising is a "non- personal paid message of commercial significance about a

product, service or company made to a market by an identified sponsor.

In developing an advertising programme, one must always start by identifying the

market needs and buyer motives and must make five major decisions commonly

referred as 5M (mission, money message, media and measurement) of advertising.

Basic Features of Advertising

On the basis of various definitions it has certain basic features such as :

1. It is a mass non-personal communication.

2. It is a matter of record.

3. It persuades buyers to purchase the goods advertised.

4. It is a mass paid communication.

5. The communication media is diverse such as print (newspapers and magazines)

6. It is also called printed salesmanship because information is spread by means of

the written and printed work and pictures so that people may be induced to

act upon it.

Functions of Advertising

For many firms advertising is the dominant element of the promotional mix –

particulars for those manufacturers who produce convenience goods such as

detergent, non – prescription drugs, cosmetics, soft drinks and grocery products.

Advertising is also used extensively by maters of automobiles, home appliances, etc,

to introduce new product and new product features its uses its attributes, pt

availability etc.

Advertising can also help to convince potential buyers that a firms product or

service is superior to competitors product in make in quality, in price etc. it can

create brand image and reduce the likelihood of brand switching even when

competitors lower their prices or offer some attractive incentives.

Advertising is particularly effective in certain other spheres too such as :

i) When consumer awareness of products or service is at a minimum.

ii) When sales are increasing for all terms in an industry.

iii) When a product is new and incorporates technological advance not strong and.

iv) When primary buying motive exists.

It performance the following functions :

i) Promotion of sales

ii) Introduction of new product awareness.

iii) Mass production facilitation

iv) Carry out research

v) Education of people.

TYPES OF ADVERTISING

Broadly speaking, advertising may be classified into two categories viz., product

and institutional advertising.

a)Product Advertising

The main purpose of such advertising is to inform and stimulate the market about

the advertisers products of services and to sell these. Thus type of advertising usually

promote specific, trended products in such a manner as to make the brands seam

more desirable. It is used by business government organization and private non-

business organizations to promote the uses features, images and benefits of their

services and products. Product advertising is sub-divided into direct action and

indirect action advertising, Direct action product advertising wages the buyer to take

action at once, ice he seeks a quick response to the advertisement which may be to

order the product by mail, or mailing a coupon, or he may promptly purchase in a

retail store in response to prince reduction during clearance sale.

Product advertising is sub-divided into direct & indirect action advertising &

product advertising aims at informing persons about what a products is what it does,

how it is used and where it can be purchased. On the other hand selective

advertising is made to meet the selective demand for a particular brand or type is

product.

b)Institutional Advertising :

It is designed to create a proper attitude towards the sellers to build company

image or goodwill rather than to sell specific product or service. Its purpose is to

create a frame of mind and to implant feeling favourable to the advertisers

company. Its assignment is to make friends for the institution or organization.

It is sub-divided into three categories : patronage, public, relations and public

service institutional advertising.

i) In patronage institutional advertising the manufacturer tells his prospects and

customer about himself his policies and lives personnel. The appeals to the

patronage motivation of buyers. If successful, he convince buyers that his

operation entitles him to the money spent by them.

ii) Public relations institutional advertising is used to create a favourable image of the

firm among employees, stock-holders or the general public.

iii) Public service institutional advertising wages public support.

c)Other Types :

The other types are as follows :

i) Consumer advertising

ii) Comparative advertising

iii) Reminder advertising

iv) Reinforcement advertising

ADVERTISING OBJECTIVES

The long term objectives of advertising are broad and general, and concern the

contribution advertising should make to the achievement of overall company

objectives. Most companies regard advertisingly main objective as hat of proving

support to personal selling and other forms of promotion. But advertising is a highly

versatile communications tools and may therefore by used for achieving various

short and long term objectives. Among these objectives are the following :

1. To do the entire selling job (as in mail order marketing).

2. To introduce a new product (by building brand awareness among potential

buyers).

3. To force middlemen to handle the product (pull strategy).

4. To build brand preference 9by making it more difficult for middleman to sell

substitutes).

5. To remind users to buy the product (retentive strategy).

6. To publicize some change in marketing strategy (e.g., a price change, a new model

or an improvement in the product).

7. To provide rationalization (i.e. Socially acceptable excuses).

8. To combat or neutralize competitors advertising.

9. To improve the moral of dealers and/or sales people (by showing that the

company is doing its share of promotion).

10. To acquaint buyers and prospects with the new uses of the product (to extend

the PLC).

BENEFITS

The functions of advertisement, and that purpose its ethics, may be discussion

below :

1. It leads to cheaper prices. "No advertiser could live in the highly competitive

arena of modern business if his methods of selling were more costly than

those of his rivals."

2. It acquaints the public with the features of the goods and advantages which

buyers will enjoy.

3. It increases demand for commodities and this results in increased production.

Advertising :

a) Creates and stimulates demand opens and expands the markets;

b) Creates goodwill which loads to an increase in sales volume;

c) Reduces marketing costs, particularly product selling costs.

d) Satisfied consumer demands by placing in the market what he needs.

4. It reduces distribution expenses in as much as it plays the part of thousands of

salesman at a home. Information on a mass scale relieves the necessity of

expenditure on sales promotion staff, and quicker and wider distribution leads

to diminishing of the distribution costs.

5. It ensures the consumers better quality of goods. A good name is the breath of

the life to an advertiser.

6. By paying the way for large scale production and increased industrialization,

advertising contributes its quota to the profit of the companies the prosperity

of the shareholder the uplifts of the wage earners and the solution of he

unemployment problem.

7. It raises the standard of living of the general public by impelling it to use to

articles of modern types which may add to his material well being. "Modern

advertising has made the luxuries of yesterday the necessities of

today ..................... It is a positive creative force in business. It makes two

blades of grass grow in the business world where one grew before.

8. It establishes the goodwill of the concern for the test articles produced by it and

in course of time they sell like not cakes consumer search for satisfaction of

their needs when they purchase goods what they want from its beauty,

superiority, economy, comfort, approval, popularity, power, safety,

convenience, sexual gratification and so on. The manufactures therefore tries

to improve this goodwill and reputation by knowing the buyer behaviour.

To sum up it may be said that advertising aims at committing the producers,

educating the consumer, supplementing the salesman converting the

producer and the dealer to eliminate the competitor, but above all it is a link

between the produce and the consumer.

WHY & WHEN TO ADVERTISE

Advertising as a tool to marketing not only reaches those who buy , but also those

whose opinions or authority is counted for example a manufacturer of marble tiles

and building boards advertises not only to people who intend to build houses but

also to architect and engineers. While the manufacturers of pharmaceuticals

products advertise to doctors as well as to the general public. At time it is necessary

for a manufacturer or a concern to advertise things which it does not sell but which

when sold stimulates the sales of its own product. There are concerns like electric

heaters, iron etc. because the use of these increases the demand for their products.

Advertising should be used only when it promises to bring good result more

economically and efficiently as compared to other means of selling. There are goods

for which much time and efforts are required in creating a demand by sending

salesman to prospective buyers than by simply advertising them. In the early days of

the cash register in America it was sold by specially trained salesman who called on

the prospective users and had the difficult task of convincing them that they could no

longer carry on with the old methods, and that they urgently needed a cash register.

In our country certain publishers have found it less costly to sell their books by

sending salesman from house to house among prospective buyers than to advertise

them. In these two examples the cost of creating demand would be too high if

attempted by advertising alone under such circumstances advertising is used to

make the salesman acceptable to the people they call upon to increase the

confidence of the public in the house. Naturals when there are good profits

competitors will be attracted and they should be kicked out as and when sufficient

capital is available by advertising on a large scale. Immediate result may not justify

the increased expenditure but it will no doubt secure future sales.

DESIGNING ADVERTISING CAMPAIGN :

An advertising is an organized series of advertising messages. It has been defined

as "a planned, co-ordinate series of promotional efforts built around a central theme

and designed to reach a specified goals." In other words, it is an orderly planned

effort consisting of related but self – contained and independent advertisements.

The campaign may appear in one more media . it has single theme or keynote idea

and a single objective or goal. Thus, "a unified theme of content provides

psychological continuity throughout the campaign while visual and oral similarity

provide physical continuity. In short run, all campaign want pre-determined

psychological reaction in the long run, practically all campaigns have sales goal.

The series of advertisements used in the campaign must be integrated with the sales

promotional efforts and with the activities of the sales force.

Campaign vary in length some may run only for a few days, other for weeks, yet

other for a season or the entire year. Usually a range of 3 to 6 months includes many

campaigns. Many factors influences campaign length such as competitors advertising

media, policies, seasonal falls curves of the product involved, the size of the

advertising funds, campaign objectives and the nature of the advertisers marketing

programme.

OBJECTIVES OF CAMPAIGN

The advertising campaign, especially those connected with the consumers aims at

achieving these objectives :

i) To announce a new product or improve product.

ii) To hold consumers patronage against intensified campaign use.

iii) To inform consumers about a new product use.

iv) To teach consumers how to use product.

v) To promote a contest or a premium offer.

vi) To establish a new trade regional, and

vii) To help solve a coca regional problem.

The institutional advertising campaign on the other hand, have these

objectives.

i) To create a corporate personality or image.

ii) To build a company prestige.

iii) To keep the company name before the public.

iv) To emphasize company services and facilities.

v) To enable company salesman to see top executive consistently when

making sales calls, and

vi) To increase friendliness and goodwill towards the company.

Developing the campaign programmes. The advertising campaigns are

prepared by the advertising agencies, which work an behalf of their clients who

manufacture product or service enterprises, which have services to sell. The word

campaign is used because advertising agencies approach their task with a sum Blanca

of military fanfare in which one frequently hears words like target audience logistics,

zero in and tactics and strategy etc.

The account executive co-ordinates the work in a campaign. The creation of an

advertising campaign starts with an exploration of consumers habits and psychology

in relation to the product. This requires the services of statistical trained in survey

techniques and of others trained in social psychology. Statisticians select samples for

survey which are done by trained interviewers who visits individuals, included in the

sample and ask question to find out about their taste and habits.

This enquiry often leads to a change in a familiar product. For instance bathing

soap may come in several new colours or cigarette in a new packet or talcum powder

in another size.

Such interviews are often quite essential to find out the appeal of advertising

message for a product that would be most effective with consumers.

David Ogilvy describes a consumers survey to find out the most meaningful

benefit in which women are interested when they buy a face cream. The largest

preference as given to "Cleans deep into pores" followed in order of importance by

prevent dryness, "is a complete beauty treatment, recommended by skin doctors"

makes skin look younger' contains estrogenic hormones, pasteurized for purity,

prevent skin form aging, smooth our wrinkles ogilvy concludes, form this voting

come one of Helena Rubinstein's most successful face creams. We christened it deep

cleanser, thus, building the winning form into name of the product.

After getting the data the account executive puts together the essential

elements of his clients brief, interprets the research findings and draws up what he

calls the "advertising strategy".

STAGE IN ADVERTISING CAMPAIGN

Several steps are required to developed an advertising campaign the number of

stages and exact order in which they are carried out may vary according to an

organisations resources, the nature of its product and the types of audiences to be

reached. The major stages/step are :

1. Identifying and analyzing the advertising.

2. Defining advertising objects.

3. Creating the advertising platform.

4. Determining the advertising appropriation.

5. Selection media plan.

6. Creating the advertising message.

7. Evaluating the effectiveness of advertising.

8. Organizing of advertising campaign.

1.Identifying & Analyzing the Advertising target :

Under this step it is to decided as to whom is the firm trying to reach with the

message. The advertising target is the group of people towards which advertisements

are aimed at four this purpose complete information about the market target i.e. the

location and geographical location of the people, the distribution of age, income, sex,

educational level, and consumers attitudes regarding purchase and use both of the

advertising product and competing products is needed with better knowledge of

market target, effective advertising campaign can be developed on the other hand, if

the advertising target is not properly identified and analyzed the campaign is does

likely to be effective.

2.Determining the advertising objectives :

The objectives of advertisement must be specifically and clearly defined in

measurable terms such as "to communicate specific qualities about a particulars

product to gain a certain degree of penetration in a definite audience of a given size

during a given period of time", increase sales by a certain percentage or increase the

firms market shares."

The goals of advertising may be to :

i) Create a favourable company image by acquainting the public with the

services offered available to the employees and its achievements.

ii) Create consumers or distributor awareness by encouraging requests

providing information about the types of products sold; providing

information about the benefits to be gained from use of the company's

products or services; and indicating how product (or services) can be

used;

iii) Encourage immediate sales by encouraging potential purchasers through

special sales contests, getting recommendation of professional people

about company's products etc.

iv) It secures action by the reader through associating ideas, repetition of the

same name in different contexts, immediate action appeal.

3.Creating the Advertising platform :

An advertising platform consists of the basic issues or selling points that an

advertiser wishes to include in the advertising campaign. A single advertisement in

an advertising campaign may contain one or more issues in the platform. A

motorcycle producers advertising platform should contain issues which are of

importance to consumers filling and such issues also be those which the competitive

product do not posses.

4. Determining the Advertising Appropriation:

The advertising appropriation is the total amount of money which marketer

allocates. For advertising for a specific time period. Determining the campaign

budget involves estimating now much it will cost to achieve the campaigns

objectives. If the campaign objectives are profit relating and stated quantitatively,

then the amount of the campaign budget is determined by estimating the proposed

campaigns effectiveness in attaining them. If campaigns object is to build a particular

type of company image, then there is little basis for predicting either the campaigns

effectiveness or determining the budget required.

5.Selecting the Media :

Media selection is an important since it costs time space and money various

factors influence this selection, the most fundamental being the nature of the target

market segment, the type of the product and the cost involved. The distinctive

characteristics of various media are also important. Therefore management should

focus its attention on media compatibility with advertising objectives.

Media Form

1. Press Advertising or Print

i) Newspapers City, Small town, Sundays,

Daily, weekly, Fortnightly,

quarterlies, financial and

annuals, English, vernacular or

regional languages.

ii) Magazines General or special, illustrated

or otherwise, English, Hindi,

Regional language.

iii) Trade & Technical Journals, Industrial

year books, commercial, directories,

telephone, Directories, references

books & annuals.

Circulated all over the country

and among the industrialist

and business magnates.

2. Direct Mail Circulars, catalogues, leaflets,

brochures, booklets, folders,

colanders, blotters, diaries &

other printed material.

3. Outdoor or Traffic Poster and bills on walls,

railways stations platforms

outside public buildings trains,

buses.

4. Broadcast or radio and T.V. Spot, Sectional or national

trade cost

5. Publicity Movie Slides and films non

theatrical and documentary

films metal plates and signs

attaches to trees.

6. House to house Sampling , couponing, free

gifts, novelties, demonst-

rations.

7. Dealer aids Counter and widows display

demonstration given by

retailer or the advertises

goods.

8. Internet Today, Internet is a big spot for advertising.

So these are the media of the advertising campaign of the selecting of the media.

6.Creating the Advertising Messages :

This is an important stage of advertising campaign. The contents of the message

has to be very carefully drafted in the advertisement. Characteristics of person in the

advertising target influence the message content and form. An advertisers must use

words, symbols and illustration that are meaningful, familiar and attractive to those

persons. The type of media also influence the content and form of the message.

7.Evaluating the Effectiveness of Advertising :

The effectiveness of advertising is measured for a variety of reasons :

a) To determine whether a campaign accomplished its advertising objects.

b) To evaluate the relative effectiveness of several advertisements to

ascertain which copy, illustrations or layout is best.

c) To determine the strengths and weaknesses of various media and media

plans.

In other words, measuring advertising effectiveness is needed to determine

whether proposed advertisement should be used and if they will be now they might

be improved; and whether going campaign should be stopped, continued or

changed. In accomplishing these purposes, pretests and post test are conducted. The

former tests before exposing target consumers to advertisements and the letter after

consumers have been exposed to advertisements and the letter after consumers

have been exposed to advertisements.

For an effective advertising programme, the advertising manager requires a

basic understanding of the medium that is going to carry it.

For effectively using advertising the management must test advertising to know which of the advertisement to know which of the advertisement have proved

profitable and why as compared to othersOBJECTIVES OF THE STUDY

Following are the objectives of the study:

1. To know the most effective media of advertisement

2. To find out the reasons for liking the advertisement of cold drinks.

3. To find out the most popular slogan of advertisement regarding cold

drinks.

Research Methodology

Research is voyage from known to unknown

Research is a procedure of logical and systematic application of the

fundamentals of science to the general and overall questions of a study and

scientific technique which provide precise tools, specific procedure and

technical rather than philosophical means for getting and ordering the data

prior to their logical analysis and manipulation. Different type of research

designs is available depending upon the nature of research project, availability

of able manpower and circumstances.

Methodology

1. Research Design: The research design is the blueprint for the

fulfillment of objectives and answering questions. It is a master plan

specifying the method and procedures for collecting and analyzing

needed information.

o Descriptive Research is used in this study as the main aim is to

describe characteristics of the phenomenon or a situation.

2. Data Collection Methods: The source of data includes primary and

secondary data sources.

Primary Sources: Primary data has been collected directly from

sample respondents through questionnaire and with the help of

interview.

Secondary Sources: Secondary data has been collected from

standard textbooks, Newspapers, Magazines & Internet.

3. Research Instrument: Research instrument used for the primary data

collection is Questionnaire.

4. Sample Design: Sample design is definite plan determine before any

data is actually obtaining for a sample from a given population. The

researcher must decide the way of selecting a sample. Samples can

be either probability samples or non-probability samples.

Sampling Technique: Convenience

Sample Size: 50 Respondents.

Area of Study: Yamuna Nagar.

MARKET PROFILE

(Coca Cola)

Brands of Coca- Cola

i) Coca Cola

ii) Thums-up

iii) Limca

iv) Fanta

v) Maaza

vi) Maaza Tetra

vii) Sprite

Flavours of the brand :

i) Cola

ii) Lemon

iii) Soda

iv) Orange

v) Mango

vi) Clear Lemon

Size of the Coca Cola cold drinks available in market

i) 200 ml Bottles (RGB Glasses)

ii) 300 ml Bottles (RGB Glasses)

iii) 500 ml Bottles (RGB Glasses)

iv) 1 Litre (PVC Bottles)

v) 1.5 Litre (PVC Bottles)

vi) 2 Litre (PVC Bottles)

Sales of Coca Cola Cold drinks

Coca Cola

Cold drinks

Weekly

(in carets)

Monthly

(in carets)

Yearly

(in carets)

Coca Cola 520 1840 22400

Fanta 250 1030 12900

Thums-up 350 1350 18500

Limca 380 1210 16300

Maaza Tetra 80 380 6200

Sprite 70 280 5000

Maaza 120 690 10000

(Primary data)

There is more consumption of Coca Cola and has 70% market share in the

Yamunanagar city and Coca Cola is having maximum consumption and after

that Thumps-up and after it Limca cold drink in the market and all the products

has good sale but less than these.

Brands of Pepsi

i) Pepsi Cola

ii) Mirinda Lemon

iii) Mirinda Orange

iv) Pepsi Soda

v) Pepsi Apple

Flavours of the brand :

i) Cola

ii) Lemon

iii) Orange

iv) Soda

v) Apple

Size of the Pepsi cold drinks available in market

vi) 200 ml Bottles (RGB Glasses)

vii) 300 ml Bottles (RGB Glasses)

viii) 500 ml Bottles (500 pt. Bottles)

ix) 1 Litre (PVC Bottles)

x) 1.5 Litre (PVC Bottles)

xi) 2 Litre (PVC Bottles)

Sales of Pepsi Cold drinks

Pepsi

Cold drinks

Weekly

(in carets)

Monthly

(in carets)

Yearly

(in carets)

Pepsi 430 1750 21600

Mirinda Lemon 390 1180 15400

Mirinda Orange 245 1000 13600

Pepsi Soda 126 470 6000

Pepsi Apple 120 400 5000

(Primary Data)

The consumption of Pepsi cola, after this sale of Mirinda Lemon is there

and after it Mirinda Orange is there and the market share is less of Pepsi in

comparison of Coca Cola.

TABLE 4.1

RESPONDENT'S CLASSIFICATION ACCORDING TO AGE

Age (in years) No. of respondents Percentage

11-20 22 44

21-40 25 50

41-60 3 6

Total 50 100

Table 4.1 shows that 44% of the respondents are in the age group of 11-20, 50% are in the age group of 21-40 and 6% are in the age group of 41-60.

TABLE 4.2

RESPONDENT'S CLASSIFICATION ACCORDING TO SEX

Sex No. of respondents Percentage

Male 30 60

Female 20 40

Total 50 100

Table 4.2 shows that 60% of the respondents are males and 40% of

them are females

TABLE 4.3

RESPONDENT'S CLASSIFICATION ACCORDING TO EDUCATIONAL

QUALIFICATION

Qualification No. of respondents Percentage

Illiterate - -

Below Matric - -

Matric 5 10

Graduate 29 58

Post graduate 16 32

Total 50 100

Table 4.3 reveals that out of 50 respondents 5 are matriculate and 29 are Graduate and rest of them 16 are post graduate.

TABLE 4.4

DRINKING OF COLD DRINK

Do you take cold drinks No. of respondents Percentage

Yes 50 100

No - -

Total 50 100

Table 4.4 reveals that all the respondents are drinking cold drinks.

TABLE 4.5

FREQUENCY OF TAKING COLD DRINKS

HOW FREQUENTLY

YOU DRINK

No. of respondents Percentage

Once a day 15 30

Twice a day 2 4

More than twice 1 2

Not regular drunker 32 64

Total 50 100

Table 4.5 reveals that 30% of the respondents drink it once a day, 4%

twice a day, 2% more than twice and 32% drink it no regularly.

TABLE 4.6

NAME OF THE COLD DRINKS AVAILABLE IN MARKET

Name of cold drinks No. of respondents Percentage

Coca cola - -

Pepsi - -

Fanta - -

Limca - -

Mirinda - -

Thums-up - -

Canada dry - -

Maaza - -

Dew - -

All of above 50 100

Total 50 100

Table 4.6 reveals that all of the respondents are of the view that all the

above mentioned cold drinks are available in the market.

TABLE 4.7

PREFERENCE OF COLD DRINK

Which cold drink you

like most


Coca cola 12 24

Pepsi 12 24

Fanta 1 2

Limca 7 14

Mirinda 1 2

Thums-up 10 20

Canada dry 4 8

Maaza 3 6

Dew - -

Total 50 100

Table 4.7 indicate that out of 50 respondents 12 like Coca cola, 12 like

Pepsi, 7 like Limca, 1 like Fanta, 1 like Mirinda, 10 like Thums-up, 4 like

Canada dry and 3 like Maaza.

TABLE 4.8

FLAVOURS OF COLD DRINKS

Flavours No. of respondents Percentage

Cola 30 60

Lemon 7 14

Orange 7 14

Mango 2 4

Others 4 8

Total 50 100

Table 4.8 shows that out of 60% of the respondents like the cola flavour of cold drink, 14% like the Lemon flavour and same percentage of respondents like the orange flavour of cold drink.

TABLE 4.9

ADVERTISEMENT OF COLD DRINK

Do you think

advertisement of cold

drink is required


Yes 48 96

No 2 4

Total 50 100

Table 4.9 indicate that 96% of the respondents are of the view that they

have been the advertisement of the cold drink they like most while 4% shows

that they don’t have seen the advertisement they like most .

TABLE 4.10

MEDIA OF ADVERTISEMENT

THROUGH WHICH

MEDIA YOU HAVE

SEEN IT?


TV 46 92

Newspaper 2 4

Magazine 1 2

Other 1 2

Total 50 100

Table 4.10 reveals that 92% of the respondents are of opinion that they have seen the advertisement on TV while 4% are of the opinion that they have seen the advertisement through newspaper.

TABLE 4.11

NO. OF ADVERTISEMENT

How many

advertisements you

seen are of the most

likely cold drink by you


1 11 22

2 14 28

3 11 22

4 14 28

Total 50 100

Table 4.11 shows that out of the 50 respondents 11 are of view that there is 1 type of advertisement and other says that there are more than one type.

TABLE 4.12

SLOGAN OF COLD DRINK

Slogan of cold drink

which you like


Taste the thunder 12 24

Yara Da tashan 14 28

Yeh dil mange more 16 32

Jo chahe ho jaye, coca

cola enjoy

8 16

Total 50 100

Table 4.12 shows that out of 50 respondents 12 like the slogan 'taste the thunder' ,14 like 'Yara da tashan', 16 like 'yeh dil mange more' and 8 like the slogan 'Jo chahe ho jaye coca cola enjoy'.

TABLE 4.13

REASON FOR LIKING THE ADVERTISEMENT

Why you like

advertisement


Its theme and making is

appealable

30 60

It has film stars 7 14

Because of good music 7 14

Other reasons 6 12

Total 50 100

Table 4.13 shows that majority of the respondents like the advertisement due to its theme while majority of the respondents like the advertisement due to its film stars and good music.

TABLE 4.14

EFFECT OF ADVERTISEMENT ON CONSUMPTION OF COLD DRINK

Do you think ads. Effect

the consumption of cold

drink


Yes 23 46

No 17 354

Cann't say 10 20

Total 50 100

Table 4.14 shows that 46% of the respondents are of the view that advertisement forced them to consume product more 34% of them has view that advertisement don’t force them to consume the product while 20% of them cannot say anything about it.

TABLE 4.15

BEST MEDIA OF ADVERTISEMENT

Which Media Presently

Is More Effectively


TV 50 100

Newspaper - -

Magazine - -

Others - -

Total 50 100

Table 4.15 reveals that 100% of the respondents are of the view that

presently the TV is most effective media of advertisement.

TABLE 4.16

NECESSITY OF ADVERTISEMENT

DO YOU THINK THE

ADVERTISEMENT IS

NECESSARY FOR

COLD DRINKS?


Necessary 14 28

Very necessary 34 68

Can’t say 2 4

Total 50 100

Table 4.16 shows that highest number of respondents are of the view that advertisement is very necessary for cold drinks while few respondents are of the view that advertisement is necessary.

TABLE 4.17

EFFECTIVENESS OF EXPENDITURE INCURRED ON

ADVERTISEMENT

Does expenditure

should be incurred on

advertisement


Yes 43 86

No 2 4

Can’t say 5 10

Total 50 100

Table 4.17 shows that 86% of the respondents are of the view that the

expenditure incurred on advertisement is effective in adding the profit while

4% denied the same and 10% did not reply.

TABLE 4.18

REASONS FOR DIFFERENCE OF ADVERTISEMENT EFFECTIVENESS

WHICH REASON YOU

FIND FOR THE

DIFFERENCE OF

ADVERTISEMENT

EFFECTIVENESS


Education 20 40

Liking 10 20

Standard of Living 10 20

Level of Development 10 20

Total 50 100

Table 4.18 shows that 40% of the respondents say education is one of

the main reason of Advertisement effectiveness while equal % of the

respondents are in the favour of likings, standars of living and level of

development

TABLE 4.19

ADD EFFECTIVENESS AND IMPROVEMENT IN ADVERTISEMENT

WILL THE STUDY OF

EFFECTIVENESS

WOULD CONTRIBUTE

TO IMPROVEMENT OF

PRESENT

ADVERTISEMENT


Yes 45 90

No 1 2

Cannot say 4 10

Total 50 100

Table 4.19 shows that the majority of the respondents are of the view that the study of effectiveness contributes the improvement in present advertisement.

TABLE 4.20

NECESSITY OF ADVERTISEMENT EFFECTIVENESS

IS ADVERTISEMENT

EFFECTIVENESS IS

NECESSARY FOR

COMPANY?


Yes 48 96

No 1 2

Can’t say 1 2

Total 50 100

Table 4.20 reveals that majority of the respondents say that the advertisement effectiveness is necessary while same did not replied.

TABLE 4.21

USERS OF ADVERTISEMENT EFFECTIVENESS

THE USE STUDY OF

EFFECTIVENESS IS

FOR WHOM?


For company 34 68

For employees 1 2

For customers 15 30

None of these - -

Total 50 100

Table 4.21 indicates that 68% of the respondents are of the view that

the study of effectiveness is meant for company while 30% say that it is meant

for customers.

LIMITATIONS The project relied mainly on the primary data. Consumer give very unclear picture. We have a limited time. The study is based on limited sample. It begin my first attempt to undertake such a study, thus the inexperience

is also a obstacle to accomplish the project in a proper way. It was also difficult to get proper information from the people because they were

indulging in some other activities.

CONCLUSIONIn last you conclude that majority of the respondents said that TV is the most effective media for advertisement of cold drinks and the celebrities and the slogans in the advertisement effect the consumers.

ADVERTISEMENT EFFECTIVENESS OF COLD DRINKS

BACK GROUND INFORMATION I) Name : __________________________________II) Age : __________________________________III) Qualification :IV) 1. Literate 2. Illiterate if literate ? 1. Below Matric 2. Matric 3. Graduate 4. Post Graduate V) Profession : __________________________________VI) Address : __________________________________ __________________________________VII) Size of family : __________________________________ 1). Do you take cold drink ? a. Yes b. No 2). How frequently you take cold drink ? a. Once a day b. Twice a day c. More than twice d. Not regular3). Which are the different cold drinks available in the market ? a. Coca Cola b. Pepsi c. Limca d. Fanta e. Thums-up f. Mirinda g. Limca h. Maaza i. Canada Dry j. All of these 4). Which cold drink you like most ? a. Coca Cola b. Pepsi c. Limca d. Fanta e. Thums-up f. Mirinda g. Limca h. Maaza i. Canada Dry j. All of these 5). Which flavour of cold drink you like most ? a. Cola b. Lemon c. Mango d. Orange e. Other 6). Have you seen the advertisement of cold drink you like most ? a. Yes b. No7). Through which media you have seen it? a. T.V. b. News Paper c. Magazine d. Others

8). How many types of advertisement of you preferred brand of cold drink are there? a. 1 b. 2 c. 3 d. 49). Which slogan of cold drink you like most ? a. Taste the Thunder b. Yara Da Tashan c. Yeh Dil Mange More d. Jo chahe ho Jai COCA-COLA enjoy10). Why do you like the advertisement ? a. Because it has film stars ? b. Because of Good music c. It’s theme and making is appealable. d. Any other reason.11). Do you think that advertisement has forced you to consume product more ? a. Yes b. No12). Which media is presenting the advertisement is necessary for sale of cold drink ? a. T.V. b. News Paper c. Magazine d. Others 13). Do you think the advertisement is necessary for sale of cold drink ? a. Necessary b. Very Necessary c. Not Necessary d. Can’t Say14). The expenditure incurred on advertisement of cold drink is such effective that it adds to profit ? a. Yes b. No c. Can’t Say 15) Which reason you find for the difference of advertisement effectiveness ? a. Education b. Likings c. Standard of Living d. Level of Development16) Is the study of effectiveness would contribute to improvement in present advertisement ? a. Yes b. No c. Can’t Say17) Is advertisement effectiveness is necessary for company ? a. Yes b. No c. Can’t Say18) What do you think the use of study of effectiveness is for who? a. For Company b. For Employees c. For Customers d. None of these

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