Professional Documents
Culture Documents
Eis SM RTP
Eis SM RTP
SUGGESTED ANSWERS/HINTS
8. Various sales and distribution activities that may get support from ERP framework are as
follows:
Pre-Sales Activities: Include prospecting of customers, identifying prospective
customers, gathering data, contacting them and fixing appointments, showing
demo, discussion, submission of quotations, etc.
Sales Order: Sales order is recorded in our books after getting a confirmed
purchased order from our customer. Sales order shall contain details just like
purchase order. E.g. Stock Item Details, Quantity, Rate, Due Date of Delivery, Place
of Delivery, etc.
Inventory Sourcing: It includes making arrangements before delivery of goods;
ensuring goods are ready and available for delivery.
Material Delivery: Material is delivered to the customer as per sales order. All
inventory details are copied from Sales Order to Material Delivery for saving user’s
time and efforts. This transaction shall have a linking with Sales Order. Stock
balance shall be reduced on recording of this transaction.
Billing: This is a transaction of raising an invoice against the delivery of material to
customer. This transaction shall have a linking with Material Delivery and all the
details shall be copied from it. Stock balance shall not affect again.
Receipt from Customer / Payment: This is a transaction of receiving amount from
customer against sales invoice and shall have a linking with sales invoice.
9. To make the information most useful, Mr. Rajesh needs to ensure that it meets the
following criteria:
Relevant - MIS reports need to be specific to the business area they address. This
is important because a report that includes unnecessary information might be
ignored.
Timely - Managers need to know what’s happening now or in the recent past to
make decisions about the future. Be careful not to include information that is old. An
example of timely information for your report might be customer phone calls and
emails going back 12 months from the current date.
Accurate - It’s critical that numbers add up and that dates and times are correct.
Managers and others who rely on MIS reports can’t make sound decisions with
information that is wrong. Financial information is often required to be accurate to
the dollar. In other cases, it may be OK to round off numbers.
Structured - Information in an MIS report can be complicated. Making that
information easy to follow helps management understand what the report is saying.
Try to break long passages of information into more readable blocks or chunks and
give these chunks meaningful headings.
10. The steps involved in the Data Mining process are as follows:
a. Data Integration: Firstly, the data are collected and integrated from all the different
sources which could be flat files, relational database, data warehouse or web etc.
b. Data Selection: It may be possible that all the data collected may not be required in
the first step. So, in this step we select only those data which we think is useful for
data mining.
c. Data Cleaning: The data that is collected are not clean and may contain errors,
missing values, noisy or inconsistent data. Thus, we need to apply different
techniques to get rid of such anomalies.
d. Data Transformation: The data even after cleaning are not ready for mining as it
needs to be transformed into an appropriate form for mining using different
techniques like - smoothing, aggregation, normalization etc.
e. Data Mining: In this, various data mining techniques are applied on the data to
discover the interesting patterns. Techniques like clustering and associatio n
analysis are among the many different techniques used for data mining.
f. Pattern Evaluation and Knowledge Presentation: This step involves
visualization, transformation, removing redundant patterns etc. from the patterns we
generated.
g. Decisions / Use of Discovered Knowledge: This step helps user to make use of
the knowledge acquired to take better informed decisions.
11. The Categories under which the logical Access Violator Mr. X may fall into are as follow:
Hackers: Hackers try their best to overcome restrictions to prove their ability. Ethical
hackers most likely never try to misuse the computer intentionally but assists in
finding the weaknesses in the system;
Employees (authorized or unauthorized);
IS Personnel: They have easiest to access to computerized information since they
come across to information during discharging their duties. Segregation of duties
and supervision help to reduce the logical access violations;
Former Employees: should be cautious of former employees who have left the
organization on unfavorable terms;
End Users; Interested or Educated Outsiders; Competitors; Foreigners; Organized
Criminals; Crackers; Part-time and Temporary Personnel; Vendors and consultants;
and Accidental Ignorant – Violation done unknowingly.
12. The various e-market models that help businesses to achieve the value adding
processes are as follows:
e-Shops (e-tailers): An e-shop is a virtual store front that sells products and
services online. E-shop is an online version of retail stores where customers can
shop at any hour of the day or night without leaving home. They are convenient way
of effecting direct sales to customers; allow manufacturers to bypass intermediate
operators and thereby reduce costs and delivery times. For example:
www.sonicnet.com, www.wforwomen.com
e–Malls: The e-mall is defined as the retailing model of a shopping mall, a
conglomeration of different shops situated in a convenient location in e-commerce.
E-malls help the consumers from a variety of stores. e.g., Yahoo! Stores
e–auctions: Electronic auctions provide a channel of communication through which
the bidding process for products and services can take place between competing
buyers. At e-auctions, people buy and sell through an auction website. In e-
auctions, almost perfect information is available about products, prices, current
demand, and supply. E-auction has become an increasingly popular tool for the
buyer to access the lowest price the suppliers are willing to charge. Example –
www.onsale.com, www.ebay.com
Portals: Portal is a website that serves as a gateway or a main entry point on the
internet to a specific field of interest or an industry. It is a website that is positioned
as an entrance to other sites on the internet. A portal consists of web pages that act
as a starting point for using the web or web-based services. The control of content
can be a source of revenue for firms through charging firms for advertising or
charging consumers a subscription for access. Some major general portals include
Yahoo, Excite, and Netscape.
Buyer Aggregators: The Buyer Aggregator brings together large numbers of
individual buyers so that they can gain the types of savings that are usually the
privilege of large volume buyers. In this, the firm collects the information about
goods/service providers, make the providers their partners, and sell their services
under its own brand. Example - www.zomato.com
Virtual Communities: Virtual Community is a community of customers who share a
common interest and use the internet to communicate with each other. Amazon.com
provides websites for the exchange of information on a wide range of subjects
relating to their portfolio of products and services. Virtual communities’ benefit from
network externalities whereby the more people who join and contribute to the
community, the greater the benefits that accrue, but without any additional cost to
participants.
e–marketing: E-marketing (Electronic Marketing) is the process of marketing a
product or service using the Internet. Of course, information on websites also
empowers customers and helps the organizations to achieve their objectives. For
example, they can compare prices of products by rival firms. The internet changes
the relationship between buyers and sellers because market information is available
to all parties in the transaction.
e-procurement: e-procurement is the management of all procurement activities via
electronic means. Business models based on e-procurement seek efficiency in
accessing information on suppliers, availability, price, quality and delivery times as
well as cost savings by collaborating with partners to pool their buying power and
secure best value deals. E-procurement infomediaries specialize in providing up-to-
date and real-time information on all aspects of the supply of materials to
businesses.
e–distribution: e-distributor is a company that supplies products and services
directly to individual business. The e-distribution model helps distributors to achieve
efficiency savings by managing large volumes of customers, automating orders,
communicating with partners and facilitating value-adding services such as order
tracking through each point in the supply chain. An example of a firm specializing in
e-distribution is www.wipro.com that uses the internet to provide fully integrated e-
business-enabled solutions that help to unify the information flows across all the
major distribution processes including sales and marketing automation, customer
service, warehouse logistics, purchasing and inventory management, and finance.
13. The risks that DJY is addressing due to its online transactions are as follows:
(i) Privacy and Security: When an organization uses internet to engage in e-
commerce, it exposes itself to additional security threats and privacy issues. There
are often issues of security and privacy due to lack of personalized digital access
and knowledge. The nature of e-commerce operations is an important factor
determining the security risks perceptions of any e-commerce installation. For
example, if the type of industry is banking and finance, it would require more
stringent deployment of security solutions than would be for manufacturing industry.
(ii) Quality issues: There are quality issues raised by customers as the original
product differs from the one that was ordered.
(iii) Delay in goods and Hidden Costs: When goods are ordered from another country,
the shipment may be delayed due to factors such as port congestion, bad weather,
custom clearances, etc. Moreover, e-commerce companies may these hidden costs.
(iv) Needs Access to internet and lack of personal touch: The e-commerce requires
an internet connection which is an extra expense and lacks personal touch.
(v) Security and credit card issues: The credit card and debit card information may
be stolen and misused which poses a security threat. There is also possibility of
cloning of credit cards and debit cards.
(vi) Infrastructure: There is a greater need of not only digital infrastructure but also
network expansion of roads and railways which remains a substantial challenge in
developing countries.
(vii) Problem of anonymity: There is need to identify and authenticate users in the
virtual global market where anyone can sell to or buy from anyone, anything from
anywhere.
(viii) Repudiation of contract: There is possibility that the electronic transaction in the
form of contract, sale order or purchase by the trading partner or customer may be
denied.
(ix) Lack of authenticity of transactions: The electronic documents that are produced
during an e-commerce transaction may not be authentic and reliable.
(x) Data Loss or theft or duplication: The data transmitted over the Internet may be
lost, duplicated, tampered with, or replayed.
(xi) Attack from hackers: Web servers used for e-commerce may be vulnerable to
hackers. A hacker is an unauthorized user who attempts to or gains access to the
system with/without the intention to steal or modify data or to insert viruses or
worms to cause damage to the system.
(xii) Denial of Service: Service to customers may be denied due to non-availability of
system as it may be affected by viruses, e-mail bombs and by transmitting so many
data packets to a server that it cannot process them all. The denial of service may
cause a network to shut down, making it impossible for users to access the site. For
busy e-commerce sites such as Flipkart, these attacks are costly; while the site is
shut down, customers cannot make purchases. Moreover, the longer a site is shut
down, the more damage is done to a site’s reputation.
(xiii) Non-recognition of electronic transactions: e-Commerce transactions, as
electronic records and digital signatures may not be recognized as evidence in
courts of law in some countries.
(xiv) Lack of audit trails: Audit trails in e-Commerce system may be lacking and the
logs may be incomplete, too voluminous or easily tampered with.
(xv) Problem of piracy: Intellectual property such as copyright may not be adequately
protected when such property is transacted through e-Commerce.
14. The various sub-processes that are involved in information Security are as follows:
Information Security Policies, Procedures and practices: This refers to the
processes relating to approval and implementation of information security. The
security policy is basis on which detailed procedures and practices are developed
and implemented at various units/department and layers of technology, as relevant.
These cover all key areas of securing information at various layers of information
processing and ensure that information is made available safely and securely. For
example – Non-disclosure agreement with employees, vendors etc., KYC
procedures for security.
User Security Administration: This refers to security for various users of
information systems. The security administration policy documents define how users
are created and granted access as per organization structure and access matrix. It
also covers the complete administration of users right from creation to disabling of
users is defined as part of security policy.
Application Security: This refers to how security is implemented at various
aspects of application right from configuration, setting of parameters and security
for transactions through various application controls. For example – Event Logging.
Database Security: This refers to various aspects of implementing security for the
database software. For example - Role based access privileges given to
employees.
Operating System Security: This refers to security for operating system software
which is installed in the servers and systems which are connected to the servers.
Network Security: This refers to how security is provided at various layers of
network and connectivity to the servers. For example - Use of virtual private
networks for employees, implementation of firewalls etc.
Physical Security: This refers to security implemented through physical access
controls. For example - Disabling the USB ports.
15. The Business Process flow of Current and Saving Account (CASA) is as follows:
(i) Either the customer approaches the relationship manager to apply for a CASA
facility or will apply the same through internet banking, the charges/ rates for the
facility are provided by the relationship manager on basis of the request made by
the customer.
(ii) Once the potential customer agrees for availing the facilities/products of the bank,
the relationship manager request for the relevant documents i.e. KYC and other
relevant documents of the customer depending upon the facility/product. KYC
(Know Your Customer) is a process by which banks obtain information about the
identity and address of the customers. KYC documents can be Passport, Driving
License, etc.
(iii) The documents received from the customers are handed over to the Credit team /
Risk team for sanctioning of the facilities/limits of the customers.
(iv) Credit team verifies the document’s, assess the financial and credit worthiness of
the borrowers and updates facilities in the customer account.
(v) Current Account /Saving Account along with the facilities requested are provided to
the customer for daily functioning.
(vi) Customers can avail facilities such as cheque deposits/ withdrawal, Cash deposit/
withdrawal, Real Time Gross Settlement (RTGS), National Electronics Funds
Transfer System (NEFT), Electronic Clearing Service (ECS), Overdraft Fund
Transfer services provided by the bank.
Descriptive Questions
Chapter 1-Introduction to Strategic Management
7. Dharam Singh, the procurement department head of Cyclix, a mountain biking equipment
company, was recently promoted to look after sales department along with procurement
department. His seniors at the corporate level have always liked his way of leadership
and are assures that he would ensure the implementation of policies and strategies to the
best of his capacity but have never involved him in decision making for the company.
Do you think this is the right approach? Validate your answer with logical reasoning
around management levels and decision making.
8. Define strategic management. Also discuss the limitations of strategic management.
Chapter 2-Dynamics of Competitive Strategy
9. ABC Ltd. manufactures and sells air purifier ‘Fresh Breath’. The ‘Fresh Breath’ has seen
sales growth of around 1% for the last two years, after strong growth in the previous five
years. This is due to new products entering the market in competition with the ‘Fresh
Breath’. ABC Ltd. is therefore considering cutting its prices to be in line with its major
rivals with a hope to maintain the market share. Market research indicates that this will
now cause a significant increase in the level of sales, even though in previous years price
cuts have had little effect on demand. ABC ltd. is also planning to launch a promotional
campaign to highlight the benefits of the ‘Fresh Breath’ against its rival products.
Identify and explain the stage of the product life cycle in which ‘Fresh Breath’ falls.
10. Write a short note on SWOT analysis.
Chapter 3-Strategic Management Process
11. Explain briefly the key areas in which the strategic planner should concentrate his mind to
achieve desired results.
12. What are 'objectives'? What characteristics it must possess to be mea ningful?
Chapter 4-Corporate Level Strategies
13. Mini theatre Ltd. was a startup venture of three young IIM graduates. They developed an
application to watch web-based content like web series, TV Shows, theatre shows, etc.
after purchasing their exclusive rights. They were successful in getting many consumers
enrolled with them. After a certain span of time, the company realized that some regional
content like ‘bangla movies’, ‘Gujarati shows’ etc. were having high cost and less
viewership. The leadership team of Mini theatre Ltd. decided to sell the rights and curtail
any further content development in these areas.
Identify and explain the corporate strategy adopted by the leadership team of Mini theatre
Ltd.
14. Justify the statement "Stability strategy is opposite of Expansion strategy".
SUGGESTED ANSWERS
1. (i) (d) (ii) (c) (iii) (c) (iv) (b) (v) (b)
2. (c)
3. (a)
4. (c)
5. (b)
6. (b)
7. Functional managers provide most of the information that makes it possible for business
and corporate level managers to formulate realistic and attainable strategies.
This is so because functional managers like Dharam Singh are closer to the customer
than the typical general manager is. A functional manager may generate important ideas
that subsequently may become major strategies for the company. Thus, it is important for
general managers to listen closely to the ideas of their functional managers and in voice
them in decision making.
An equally great responsibility for managers at the operational level is strategy
implementation: the execution of corporate and business level plans, and if they are
involved in formulation, the clarity of thoughts while implementation can benefit too.
Thus, the approach of Cylcix Corporate management is not right. They should involve
Dharam Singh, as well as other functional managers too in strategic management.
8. The term ‘strategic management’ refers to the managerial process of developing a
strategic vision, setting objectives, crafting a strategy, implementing and evaluating the
strategy, and initiating corrective adjustments where deemed appropriate.
The presence of strategic management cannot counter all hindrances and always achieve
success as there are limitations attached to strategic management. These can be
explained in the following lines:
Environment is highly complex and turbulent. It is difficult to understand the
complex environment and exactly pinpoint how it will shape-up in future. The
organisational estimate about its future shape may awfully go wrong and jeopardise
all strategic plans. The environment affects as the organisationhas to deal with
suppliers, customers, governments and other external factors.
Strategic management is a time-consuming process. Organisations spend a lot
of time in preparing, communicating the strategies that may impede daily operations
and negatively impact the routine business.
Strategic management is a costly process. Strategic management adds a lot of
expenses to an organization. Expert strategic planners need to be engaged, efforts
are made for analysis of external and internal environments devise strategies and
properly implement. These can be really costly for organisations with limited
resources particularly when small and medium organisation create strategies to
compete.
Competition is unpredictable. In a competitive scenario, where all organisations
are trying to move strategically, it is difficult to clearly estimate the competitive
responses to the strategies.
9. Product Life Cycle is a useful concept for guiding strategic choice. PLC is an S-shaped
curve which exhibits the relationship of sales with respect of time for a product that
passes through the four successive stages of introduction (slow sales growth), growth
(rapid market acceptance) maturity (slowdown in growth rate) and decline (sharp
downward drift).
The product ‘Fresh Breath’ of ABC Ltd. falls under Maturity stage of product life cycle. In
this stage, the competition gets tough and market gets stablised. Profit comes down
because of stiff competition. At this stage, ABC Ltd. have to work for maintaining stability
by cutting the prices to be in line with its major rivals with a hope to maintain the market
share and by launching a promotional campaign to highlight the benefits of the ‘Fresh
Breath’ against its rival products.
10. SWOT analysis is a tool used by organizations for evolving strategic options for the
future. The term SWOT refers to the analysis of strengths, weaknesses, opportunities and
threats facing a company. Strengths and weaknesses are identified in the internal
environment, whereas opportunities and threats are located in the external environment.
(a) Strength: Strength is an inherent capability of the organization which it can use to
gain strategic advantage over its competitor.
(b) Weakness: A weakness is an inherent limitation or constraint of the organisation
which creates strategic disadvantage to it.
(c) Opportunity: An opportunity is a favourable condition in the external environment
which enables it to strengthen its position.
(d) Threat: An unfavourable condition in the external environment which causes a risk
for, or damage to the organisation’s position.
The major purpose of SWOT analysis is to enable the management to create a firm -
specific business model that will best align, fit or match an organisational resources and
capabilities to the demands for environment in which it operates.
11. A strategic manager defines the strategic intent of the organisation and take it on the path
of achieving the organisational objectives. There can be a number of areas that a
strategic manager should concentrate on to achieve desired results. They commonly
establish long-term objectives in seven areas as follows:
• Profitability.
• Productivity.
• Competitive Position.
• Employee Development.
• Employee Relations.
• Technological Leadership.
• Public Responsibility.
12. Objectives are organizations performance targets – the results and outcomes it wants to
achieve. They function as yardstick for tracking an organization’s performance and
progress.
Objectives with strategic focus relate to outcomes that strengthen an organization’s
overall business position and competitive vitality. Objectives, to be meaningful to serve
the intended role, must possess the following characteristics:
Objectives should define the organization’s relationship with its environment.
diagnosing the significant competitive pressures in a market and assessing the strength
and importance of each is the Porter’s five-forces model of competition. This model holds
that the state of competition in an industry is a composite of competitive pressures
operating in five areas of the overall market as follows:
(i) Rivalry among current players: Competitive pressures associated with the market
manoeuvring and jockeying for buyer patronage that goes on among rival sellers in
the industry.
(ii) Threat of new entrants: Competitive pressures associated with the threat of new
entrants into the market.
(iii) Threats from substitutes: Competitive pressures coming from the attempts of
companies in other industries to win buyers over to their own substitute products.
(iv) Bargaining power of suppliers: Competitive pressures stemming from supplier
bargaining power and supplier-seller collaboration.
(v) Bargaining power of customers: Competitive pressures stemming from buyer
bargaining power and seller-buyer collaboration.
16. Cost leadership strategy requires vigorous pursuit of cost reduction in the areas of
procurement, production, storage and distribution of product or service and als o
economies in overhead costs. Accordingly, the cost leader is able to charge a lower price
for its products than its competitors and still make satisfactory profits. The low cost
leadership should be such that no competitors are able to imitate so that it can result in
sustainable competitive advantage to the cost leader firm.
To achieve cost leadership, following are the actions that could be taken:
1. Forecast the demand of a product or service promptly.
2. Optimum utilization of the resources to get cost advantages.
3. Achieving economies of scale leads to lower per unit cost of product/service.
4. Standardisation of products for mass production to yield lower cost per unit.
5. Invest in cost saving technologies and try using advance technology for smart
working.
6. Resistance to differentiation till it becomes essential.
17. The higher-level corporate strategies need to be segregated into viable plans and policies
that are compatible with each other and communicated down the line. The higher-level
strategies need to be broken into functional strategies for implementation. These
functional strategies, in form of marketing, finance, human resource, production, research
and development help in achieving the organisational objective. The reasons why
functional strategies are needed can be enumerated as follows:
Functional strategies lay down clearly what is to be done at the functional level.
They provide a sense of direction to the functional staff.
They are aimed at facilitating the implementation of corporate strategies and the
business strategies formulation at the business level.
They act as basis for controlling activities in the different functional areas of
business.
They help in bringing harmony and coordination as they are formulated to achieve
major strategies.
Similar situations occurring in different functional areas are handled in a consistent
manner by the functional managers.
18. Publicity and Sales promotion are adopted by organizations when they are undertaking
promotion in the overall marketing mix.
Publicity is a non-personal form of promotion similar to advertising. However, no
payments are made to the media as in case of advertising. Organizations skillfully seek to
promote themselves and their product without payment. Publicity is communication of a
product, brand or business by placing information about it in the media without paying for
the time or media space directly.
Thus, it is way of reaching customers with negligible cost. Basic tools for publicity are
press releases, press conferences, reports, stories, and internet releases. These
releases must be of interest to the public.
Sales promotion is an omnibus term that includes all activities that are undertaken to
promote the business but are not specifically included under personal selling, advertising
or publicity. Activities like discounts, contests, money refunds, installments, kiosks,
exhibitions and fairs constitute sales promotion. All these are meant to give a boost to the
sales. Sales promotion done periodically may help in getting a larger market share to an
organization.
19. Suraj Prakesh is a follower of transactional leadership style that focuses on designing
systems and controlling the organization’s activities. Such a leader believes in using
authority of its office to exchange rewards, such as pay and status. They prefer a more
formalized approach to motivation, setting clear goals with explicit rewards or penalties
for achievement or non-achievement. Transactional leaders try to build on the existing
culture and enhance current practices. The style is better suited in persuading people to
work efficiently and run operations smoothly.
On the other hand, Chander Prakash is a follower of transformational leadership style.
The style uses charisma and enthusiasm to inspire people to exert them for the good of
the organization. Transformational leaders offer excitement, vision, intellec tual stimulation
and personal satisfaction. They inspire involvement in a mission, giving followers a
‘dream’ or ‘vision’ of a higher calling so as to elicit more dramatic changes in
organizational performance. Such a leadership motivates followers to do m ore than
originally affected to do by stretching their abilities and increasing their self -confidence,
and also promote innovation throughout the organization.
20. Corporate culture refers to company’s values, beliefs, business principles, traditions,
ways of operating and internal work environment. Changing problem cultures is very
difficult because of deeply held values and habits. It takes concerted management action
over a period of time to replace an unhealthy culture with a healthy culture or to roo t out
certain unwanted cultural obstacles and instil ones that are more strategy -supportive.
The first step is to diagnose which facets of the present culture are strategy
supportive and which are not.
Then, managers have to talk openly and forthrightly to all concerned about those
aspects of the culture that have to be changed.
The talk has to be followed swiftly by visible, aggressive actions to modify the
culture-actions that everyone will understand are intended to establish a new culture
more in tune with the strategy.
Management through communication has to create a shared vision to manage changes.
The menu of culture-changing actions includes revising policies and procedures, altering
incentive compensation, shifting budgetary allocations for substantial resources to new
strategy projects, recruiting and hiring new managers and employees, replacing key
executives, communication on need and benefit to employees and so on.
21. Importance of strategic control: Strategic control is an important process that keeps
organisation on its desired path. It involves evaluating strategy as it is formulated and
implemented. It is directed towards identifying problems and changes in premises and
making necessary adjustments. Strategic control focuses on the dual questions of
whether: (1) the strategy is being implemented as planned; and (2) the results produced
by the strategy are those intended.
There are four types of strategic control:
Premise control: A strategy is formed on the basis of certain assumptions or
premises about the environment. Premise control is a tool for systematic and
continuous monitoring of the environment to verify the validity and accuracy of the
premises on which the strategy has been built.
Strategic surveillance: Strategic surveillance is unfocussed. It involves general
monitoring of various sources of information to uncover unanticipated information
having a bearing on the organizational strategy.
Special alert control: At times, unexpected events may force organizations to
reconsider their strategy. Sudden changes in government, natural calamities,
unexpected merger/acquisition by competitors, industrial disasters and other such
events may trigger an immediate and intense review of strategy.
Implementation control: Managers implement strategy by converting major plans
into concrete, sequential actions that form incremental steps. Implementation control
is directed towards assessing the need for changes in the overall strategy in light of
unfolding events and results.