TOPIC 1: PERSONNEL MANAGEMENT - Meaning, Functions and Principle

Personnel management can be defined as obtaining, using and maintaining a satisfied

workforce. It is a significant part of management concerned with employees at work and with
their relationship within the organization.
According to Flippo, “Personnel management is the planning, organizing, compensation,
integration and maintenance of people for the purpose of contributing to organizational,
individual and societal goals.”
According to Brech, “Personnel Management is that part which is primarily concerned with
human resource of organization.”

 Nature of Personnel Management

Personnel management includes the function of employment, development and compensation-
These functions are performed primarily by the personnel management in consultation with
other departments.
Personnel management is an extension to general management. It is concerned with promoting
and stimulating competent work force to make their fullest contribution to the concern.
Personnel management exist to advice and assist the line managers in personnel matters.
Therefore, personnel department is a staff department of an organization.
Personnel management lays emphasize on action rather than making lengthy schedules, plans,
work methods. The problems and grievances of people at work can be solved more effectively
through rationale personnel policies.
It is based on human orientation. It tries to help the workers to develop their potential fully to
the concern. It also motivates the employees through it’s effective incentive plans so that the
employees provide fullest co-operation. Personnel management deals with human resources of
a concern. In context to human resources, it manages both individual as well as blue- collar
workers.

 Role of Personnel Manager

Personnel manager is the head of personnel department. He performs both managerial and
operative functions of management. His role can be summarized as :
Personnel manager provides assistance to top management- The top management are the
people who decide and frame the primary policies of the concern. All kinds of policies related to
personnel or workforce can be framed out effectively by the personnel manager.
He advices the line manager as a staff specialist- Personnel manager acts like a staff advisor and
assists the line managers in dealing with various personnel matters.
As a counsellor,- As a counsellor, personnel manager attends problems and grievances of
employees and guides them. He tries to solve them in best of his capacity.
Personnel manager acts as a mediator- He is a linking pin between management and workers.
He acts as a spokesman- Since he is in direct contact with the employees, he is required to act
as representative of organization in committees appointed by government. He represents
company in training programmes.

 Functions of Personnel Management

Following are the four functions of Personnel Management:
1. Manpower Planning
2. Recruitment
3. Selection
4. Training and Development
 MANPOWER PLANNING
Manpower Planning which is also called as Human Resource Planning consists of putting right
number of people, right kind of people at the right place, right time, doing the right things for
which they are suited for the achievement of goals of the organization. Human Resource
Planning has got an important place in the arena of industrialization. Human Resource Planning
has to be a systems approach and is carried out in a set procedure. The procedure is as follows:
 Analysing the current manpower inventory
 Making future manpower forecasts
 Developing employment programmes
 Design training programmes
Steps in Manpower Planning
Analysing the current manpower inventory- Before a manager makes forecast of future
manpower, the current manpower status has to be analysed. For this the following things have
to be noted-
 Type of organization
 Number of departments
 Number and quantity of such departments
 Employees in these work units
Once these factors are registered by a manager, he goes for the future forecasting. Making
future manpower forecasts- Once the factors affecting the future manpower forecasts are
known, planning can be done for the future manpower requirements in several work units. The
Manpower forecasting techniques commonly employed by the organizations are as follows:
 1. 3Expert Forecasts: This includes informal decisions, formal expert surveys and Delphi
technique.
2. Trend Analysis: Manpower needs can be projected through extrapolation (projecting
past trends), indexation (using base year as basis), and statistical analysis (central
tendency measure).
3. Work Load Analysis: It is dependent upon the nature of work load in a department, in a
branch or in a division
4. Work Force Analysis: Whenever production and time period has to be analysed, due
allowances have to be made for getting net manpower requirements.
5. Other methods: Several Mathematical models, with the aid of computers are used to
forecast manpower needs, like budget and planning analysis, regression, new venture
analysis.
Developing employment programmes- Once the current inventory is compared with future
forecasts, the employment programmes can be framed and developed accordingly, which will
include recruitment, selection procedures and placement plans.
Design training programmes- These will be based upon extent of diversification, expansion
plans, development programmes,etc. Training programmes depend upon the extent of
improvement in technology and advancement to take place. It is also done to improve upon the
skills, capabilities, knowledge of the workers.
Importance of Manpower Planning
 Key to managerial functions- The four managerial functions, i.e., planning, organizing,
directing and controlling are based upon the manpower. Human resources help in the
implementation of all these managerial activities. Therefore, staffing becomes a key to
all managerial functions.
 Efficient utilization- Efficient management of personnels becomes an important function
in the industrialization world of today. Seting of large scale enterprises require
management of large scale manpower. It can be effectively done through staffing
function
 Motivation- Staffing function not only includes putting right men on right job, but it also
comprises of motivational programmes, i.e., incentive plans to be framed for further
participation and employment of employees in a concern. Therefore, all types of
incentive plans becomes an integral part of staffing function
 Better human relations- A concern can stabilize itself if human relations develop and are
strong. Human relations become strong trough effective control, clear communication,
effective supervision and leadership in a concern. Staffing function also looks after
training and development of the work force which leads to co-operation and better
human relations.
 Higher productivity- Productivity level increases when resources are utilized in best
possible manner. higher productivity is a result of minimum wastage of time, money,
 efforts and energies. This is possible through the staffing and it's related activities (
Performance appraisal, training and development, remuneration)
Need of Manpower Planning
Manpower Planning is a two-phased process because manpower planning not only analyses the
current human resources but also makes manpower forecasts and thereby draw employment
programmes. Manpower Planning is advantageous to firm in following manner:
1. Shortages and surpluses can be identified so that quick action can be taken wherever
required.
2. All the recruitment and selection programmes are based on manpower planning.
3. It also helps to reduce the labour cost as excess staff can be identified and thereby
overstaffing can be avoided.
4. It also helps to identify the available talents in a concern and accordingly training
programmes can be chalked out to develop those talents.
5. It helps in growth and diversification of business. Through manpower planning, human
resources can be readily available and they can be utilized in best manner.
6. It helps the organization to realize the importance of manpower management which
ultimately helps in the stability of a concern.

 RECRUITMENT
Recruitment is of 2 types
Internal Recruitment - is a recruitment which takes place within the concern or organization.
Internal sources of recruitment are readily available to an organization. Internal sources are
primarily three - Transfers, promotions and Re-employment of ex-employees.
Internal recruitment may lead to increase in employee’s productivity as their motivation level
increases. It also saves time, money and efforts. But a drawback of internal recruitment is that
it refrains the organization from new blood. Also, not all the manpower requirements can be
met through internal recruitment. Hiring from outside has to be done.
Internal sources are primarily 3
1. Transfers
2. Promotions (through Internal Job Postings) and
3. Re-employment of ex-employees - Re-employment of ex-employees is one of the internal
sources of recruitment in which employees can be invited and appointed to fill vacancies in
the concern. There are situations when ex-employees provide unsolicited applications also.
External Recruitment - External sources of recruitment have to be solicited from outside the
organization. External sources are external to a concern. But it involves lot of time and money.
The external sources of recruitment include - Employment at factory gate, advertisements,
employment exchanges, employment agencies, educational institutes, labour contractors,
recommendations etc.
 Employment at Factory Level - This a source of external recruitment in which the
applications for vacancies are presented on bulletin boards outside the Factory or at the
Gate. This kind of recruitment is applicable generally where factory workers are to be
appointed. There are people who keep on soliciting jobs from one place to
another.These types of workers apply on their own for their job. For this kind of
recruitment workers have a tendency to shift from one factory to another and therefore
they are called as “badli” workers.
 Advertisement - It is an external source which has got an important place in recruitment
procedure. The biggest advantage of advertisement is that it covers a wide area of
market and scattered applicants can get information from advertisements. Medium
used is Newspapers and Television
 Employment Exchanges - There are certain Employment exchanges which are run by
government. Most of the government undertakings and concerns employ people
through such exchanges. Now-a-days recruitment in government agencies has become
compulsory through employment exchange.
 Employment Agencies - There are certain professional organizations which look towards
recruitment and employment of people, i.e. these private agencies run by private
individuals supply required manpower to needy concerns.
 Educational Institutions - There are certain professional Institutions which serves as an
external source for recruiting fresh graduates from these institutes. This kind of
recruitment done through such educational institutions, is called as Campus
Recruitment. They have special recruitment cells which helps in providing jobs to fresh
candidates
 Recommendations - There are certain people who have experience in a particular area.
They enjoy goodwill and a stand in the company. There are certain vacancies which are
filled by recommendations of such people. The biggest drawback of this source is that
the company has to rely totally on such people which can later on prove to be inefficient
 Labour Contractors - These are the specialist people who supply manpower to the
Factory or Manufacturing plants. Through these contractors, workers are appointed on
contract basis, i.e. for a particular time period. Under conditions when these contractors
leave the organization, such people who are appointed have to also leave the concern.

 SELECTION
Employee Selection is the process of putting right men on right job. It is a procedure of
matching organizational requirements with the skills and qualifications of people. Effective
selection can be done only when there is effective matching. By selecting best candidate for the
required job, the organization will get quality performance of employees. Moreover,
organization will face less of absenteeism and employee turnover problems. By selecting right
candidate for the required job, organization will also save time and money. Proper screening of
candidates takes place during selection procedure. All the potential candidates who apply for
the given job are tested.

But selection must be differentiated from recruitment, though these are two phases of
employment process. Recruitment is considered to be a positive process as it motivates more
of candidates to apply for the job. It creates a pool of applicants. It is just sourcing of data.
While selection is a negative process as the inappropriate candidates are rejected here.
Recruitment precedes selection in staffing process. Selection involves choosing the best
candidate with best abilities, skills and knowledge for the required job.
The Employee selection Process takes place in following order-
 Preliminary Interviews- It is used to eliminate those candidates who do not meet the
minimum eligiblity criteria laid down by the organization. The skills, academic and family
background, competencies and interests of the candidate are examined during
preliminary interview. Preliminary interviews are less formalized and planned than the
final interviews. The candidates are given a brief up about the company and the job
profile; and it is also examined how much the candidate knows about the company.
Preliminary interviews are also called screening interviews.

 Application blanks- The candidates who clear the preliminary interview are required to
fill application blank. It contains data record of the candidates such as details about age,
qualifications, reason for leaving previous job, experience, etc.
 Written Tests- Various written tests conducted during selection procedure are aptitude
test, intelligence test, reasoning test, personality test, etc. These tests are used to
objectively assess the potential candidate. They should not be biased.
 Employment Interviews- It is a one to one interaction between the interviewer and the
potential candidate. It is used to find whether the candidate is best suited for the
required job or not. But such interviews consume time and money both. Moreover the
competencies of the candidate cannot be judged. Such interviews may be biased at
times. Such interviews should be conducted properly. No distractions should be there in
room. There should be an honest communication between candidate and interviewer.
 Medical examination- Medical tests are conducted to ensure physical fitness of the
potential employee. It will decrease chances of employee absenteeism.
 Appointment Letter- A reference check is made about the candidate selected and then
finally he is appointed by giving a formal appointment letter.

 TRAINING AND DEVELOPMENT

Training of employees takes place after orientation takes place. Training is the process of
enhancing the skills, capabilities and knowledge of employees for doing a particular job.
Training process moulds the thinking of employees and leads to quality performance of
employees. It is continuous and never ending in nature. Training is crucial for organizational
development and success. It is fruitful to both employers and employees of an organization. An
employee will become more efficient and productive if he is trained well.
Training is given on four basic grounds:
 New candidates who join an organization are given training. This training familiarize
them with the organizational mission, vision, rules and regulations and the working
conditions.

 The existing employees are trained to refresh and enhance their knowledge.

 If any updations and amendments take place in technology, training is given to cope up
with those changes. For instance, purchasing a new equipment, changes in technique of
production, computer implantment. The employees are trained about use of new
equipments and work methods.

 When promotion and career growth becomes important. Training is given so that
employees are prepared to share the responsibilities of the higher level job.

The benefits of training can be summed up as:

1. Improves morale of employees- Training helps the employee to get job security and job
satisfaction. The more satisfied the employee is and the greater is his morale, the more
he will contribute to organizational success and the lesser will be employee absenteeism
and turnover.
2. Less supervision- A well trained employee will be well acquainted with the job and will
need less of supervision. Thus, there will be less wastage of time and efforts.
3. Fewer accidents- Errors are likely to occur if the employees lack knowledge and skills
required for doing a particular job. The more trained an employee is, the less are the
chances of committing accidents in job and the more proficient the employee becomes.
4. Chances of promotion- Employees acquire skills and efficiency during training. They
become more eligible for promotion. They become an asset for the organization.
5. Increased productivity- Training improves efficiency and productivity of employees. Well
trained employees show both quantity and quality performance. There is less wastage
of time, money and resources if employees are properly trained
Ways/Methods of Training
Training is generally imparted in two ways:
On the job training- On the job training methods are those which are given to the employees
within the everyday working of a concern. It is a simple and cost-effective training method. The
inproficient as well as semi- proficient employees can be well trained by using such training
method. The employees are trained in actual working scenario. The motto of such training is
“learning by doing.” Instances of such on-job training methods are job-rotation, coaching,
temporary promotions, etc.

Off the job training- Off the job training methods are those in which training is provided away
from the actual working condition. It is generally used in case of new employees. Instances of
off the job training methods are workshops, seminars, conferences, etc. Such method is costly
and is effective if and only if large number of employees have to be trained within a short time
period. Off the job training is also called as vestibule training,i.e., the employees are trained in a
separate area( may be a hall, entrance, reception area,etc. known as a vestibule) where the
actual working conditions are duplicated.

TOPIC: PERSONNEL MANAGEMENT - Meaning, Functions and Principle (2)

Meaning of Personnel Management:

Personnel Management (staffing function of Management), also known as Human Resource

Management. Personnel management is concerned with the proper use of human factors.
Personnel management may be defined as that part of the management process, which is
primarily concerned with the human constituents of an organisation.

Personnel management can also be defined as, that field of management which is concerned
with the planning, organising, directing and controlling various operative functions of
procurement, development, maintenance and utilisation of a labor force in such a way that
objectives of company, those of personnel at all levels and those of community are achieved.

Meanings of some of the words used in this definition are explained below:

(i) Planning:

Planning means determination of personnel programme in advance.

(ii) Organising:
 Organising means establishing an organisation by designing the structure of
relationships among job, personnel and other physical factors to attain the company
objectives.

(iii) Directing:

Directing means guiding the people to do the work effectively.

(iv) Controlling:

Controlling means regulating the activities in accordance with the plan.

(v) Procurement:

Procurement of labor means obtaining the proper kind of personnel in required

quantity to achieve company goals.
(vi) Development:
Development of labor means increasing the skill of employees through training.
(vii) Maintenance:
Maintenance means improving the conditions (e.g., health, safety, welfare etc.,) and
sustaining them.

Traditionally, personnel management system is concerned primarily with the five basic sub-
systems, namely recruiting, placement training, compensation and maintenance.
Human Resource Management, as against these traditional functions should be considered as
total system that interacts with the other major systems of the organisation purchasing,
production, finance, marketing etc. The primary object of the human resource management
programme is to serve these major systems.

Forecasting and planning the personnel needs of the organisation, maintaining an adequate
and satisfactory workforce and controlling the personnel policies and programmes of the
organisation are the major responsibilities of the human resource management.

In addition to different functions, in recent years following additional responsibilities are also
expected from modern resource management system:
(i) Equal employment opportunity.
(ii) Occupational safety and health.
(iii) Employment retirement income security.
(iv) Upliftment of affected classes, a social responsibility.
Functions and Objectives of Personnel Management:

Personnel Management functions are generally divided into planning, organising, staffing,
motivating and controlling aspects.
Major functions and objectives are given here under:
Principles of Personnel Management:

Principles of personnel management help the personnel managers to conduct and direct the
policies in a proper way.

These principles are:

1. Principle of Maximum Personnel Development:
By this principle, the workers are developed to the maximum extent, so that their developed
ability, cleverness, productivity and efficiency can be used for the firm’s objective.

2. Principle of Scientific Selection:

This principle enables to have a right person for the right job.

3. Principle of High Morale:

Ideal wage policy should be offered to the workers so that their morale becomes high and
they work with interest.

4. Principle of Dignity of Labour:

The labour should feel proud of their work.

5. Principle of Team Spirit:

Team spirit must be developed in the workers. They should work collectively with collective
responsibility, and should have sense of cooperation, unity and mutual trust.

6. Principle of Effective Communication:

There must be effective communication between the management and workers otherwise
complex problems like mistrust, hatred and ill- will arise which in turn affects the production
of the organisation.

7. Principle of Joint Management:

This creates responsibility in the labor with increasing mutual faith and friendship. This
improves the labor relations.

8. Principle of Fair Reward:

Labour should be given proper compensation for the work. This develops industrial piece.

9. Principle of Effective Utilization of Human Resources:

Personnel management should be developed for the effective use of the human resources.
Proper training should be awarded to the personnel for their development.
TOPIC 2: Psychology and its relevance to an organization
What is psychology?
Psychology is the study of people’s behaviour, performance, and mental operations. It also
refers to the application of the knowledge, which can be used to understand events, treat
mental health issues, and improve education, employment and relationships. The subject lies at
the intersection of applied, educational and theoretical science.
There are sub-areas of psychology, including:
1. Sports
2. Education
3. Business
4. Media
5. Physical conditions
6. Human development
The subject involves other areas of study, including humanities, natural sciences and other
social sciences.
To sum it up: “It’s all in the mind”- in the words of George Harrison.
Relevance of psychology to the organization
Most often referred to as industrial –organizational psychology, other names for this field
include IO psychology, work psychology, business psychology and occupational psychology.
It refers to the practice of applying psychological principles and practices to a work
environment. The goal is to identify and solve problems, increase employee satisfaction and
improve workplace dynamics.
The role of psychology in the organization
1. Recruitment: Workplace psychology principles can help employers identify the key
skills, educational requirements and work experience their employees must possess.
Knowing these could help the employer draft appropriate job descriptions and
advertisements, and look for these qualities throughout the interview process. It helps
employers understand how to hire for particular traits without being discriminatory.
2. Training and development: Workplace psychology can help employers to pinpoint their
staff’s training needs. It can also guide them in delivering the relevant training in an
engaging fashion. This training often consists of a state or federally mandated training,
workplace or industry-specific training, and intellectual enrichment for a particular work
setting.
3. Performance Appraisals: Performance appraisals are standard organizational
psychology tools. They are designed to provide employees with feedback about their
performance, to help foster increased productivity. In theory, appraisals also facilitate
clear communications between management and employees. They may act as forums
 for setting goals, as well as starting points for performance improvement plans, if
necessary. Finally, they can help human resources identify training needs.
4. Compensation: Compensation is an important part of employee satisfaction and
psychology in the workplace. Organizational psychology strategies take this into
consideration when developing compensation strategies such as pay for performance
plans.
5. Psychology of motivation and productivity in the organization: Increased motivation
leads to increased productivity. However, the reverse could also be true. Work
psychology holds that tactics like contests, performance appraisals, sales quotas and
commission pay can all improve motivation. Done effectively, this could ultimately lead
to greater productivity.

Sociology and its relevance to an organization

 Sociology is the study of human social life.
 Sociology studies human society as an interconnected whole and how society and the
individual interact with each other.
 It is a systematic and scientific study of society, distinct from philosophical and religious
reflection as well as our everyday common sense observation about society.
 Distinct way of studying society can be better understood when we look back
historically at the intellectual ideas and material contents within which sociology was
born and later grew.
 Society is the name given to social relationship by which every human being is
interconnected with his fellow men.
Sociology is the study of human social relationships and institutions. Sociology’s subject matter
is diverse. It ranges from crime to religion, from the family to the state, from the divisions of
race and social class to the shared belief of a common culture.
At the personal level, sociology investigates the social causes and consequences of things such
as social and gender identity, family conflict, deviant behavior and religious faith.
Sociologists emphasize the careful gathering and analysis of the involvement of social life to
develop and enrich our understanding of key social processes.
In sociology, organization is understood as planned, coordinated and purposeful action of
human beings to construct or compile a common tangible or intangible product. This is usually
framed by formalities. Sociology distinguishes the term organization into planned formal and
unplanned informal organizations.
Sociology is much concerned with understanding social structures and organizational sociology
gives much attention to the internal structures of the organizations, such as the managerial
hierarchy, as well as to the external structures that connect organizations, such as strategic
alliances. Organizational sociology tends to focus work on authority and power.
It also has equally concerning links with other sociological approaches which also study work
situations.

Personality problems
Personality problems, also known as personality disorders, are probably the most common
form of mental disorder. Currently, the two official classification systems in psychiatry- the
Diagnostic and Statistical Manual of Mental Disorders in the USA and the International
Classification of Diseases (the official world classification led by the World Health Organization)-
describe personality disorders in two stages; a general definition, followed by categorization
into 10 further categories: antisocial, emotionally unstable, impulsive, obsessive compulsive,
histrionic, narcissistic, schizoid, schizotypal and anxious, with a very common additional
category, personality disorder-not otherwise specified(PD-NOS).
The new classification of personality disorder was published in 2015 in the International
Classification of Diseases. This is a much simpler classification in which personality dysfunction
is assessed on a single dimension- no personality dysfunction, personality difficulty, mild
personality disorder, moderate personality disorder and severe personality disorder.
The overall prevalence of personality disorder is in the order of 10% in the community, but if
we also include personal difficulty (a sub-threshold condition below the status of a disorder),
this rises to nearly 30%, as a very large population of people have some problems with
personality function when placed in certain settings. Many of these settings are occupational
ones and our expectation in the future is that occupational physicians will require some training
in the assessment of personality disorder as one of their functions is ensuring optimum
occupational performance. Many people with personality disorder have unhappy encounters in
the workplace, and a recent survey showed that 29% of the sample with no personality disorder
was unemployed or economically active compared to the 38% of those with personality
disorder.
The special problems encountered in the workplace for those with personality disorder include
a greater propensity to have time off sick and seek compensation, to have stress disorders of
the workplace, to develop chronic disability, to have poorer social functioning and to
deliberately lose jobs. In a broad review of the topic in 2010, Sansone and Sansone concluded
that the twin problems of neuroticism and disagreeableness were the main features
responsible for occupational problems.
TOPIC 3: INTRODUCTION TO TRAINING OBJECTIVE, ADVANTAGES, METHODS,
PROCEDURE AND PSYCHOLOGICAL TEST

Training: Meaning, Objectives, Need and Importance!

Training is concerned with increasing the knowledge and skills of employees for doing specific
jobs, and development involves the growth of employees in all aspects.

Meaning of Training:

“Training is the act of increasing the knowledge and skills of an employee for doing a particular
job.” — Edwin B. Flippo

Training is an organized activity for increasing the technical skills of the employees to enable

them to do particular jobs efficiently. In other words, training provides the workers with facility

to gain technical knowledge and to learn new skills to do specific jobs. Training is equally

important for the existing as well as the new employees. It enables the new employees to get
acquainted with their jobs and also increase the job-related knowledge and skills.

Objectives of Training:

The objectives of training are as follows:

(i) To provide job related knowledge to the workers.

(ii) To impart skills among the workers systematically so that they may learn quickly.

(iii) To bring about change in the attitudes of the workers towards fellow workers, supervisor
and the organization.
(iv) To improve the productivity of the workers and the organization.

(v) To reduce the number of accidents by providing safety training to the workers,

(vi) To make the workers handle materials, machines and equipment efficiently and thus to
check wastage of time and resources.

(vii) To prepare workers for promotion to higher jobs by imparting them advanced skills.

Need and Importance of Training:

The need for training of employees arises due to the following factors:

(i) Higher Productivity:

It is essential to increase productivity and reduce cost of production for meeting competition in

the market. Effective training can help increase productivity of workers by imparting the
required skills.

(ii) Quality Improvement:

The customers have become quality conscious and their requirement keep on changing. To

satisfy the customers, quality of products must be continuously improved through training of
workers.

(iii) Reduction of Learning Time:

Systematic training through trained instructors is essential to reduce the training period. If the

workers learn through trial and error, they will take a longer time and even may not be able to
learn right methods of doing work.

(iv) Industrial Safety:

Trained workers can handle the machines safely. They also know the use of various safety
devices in the factory. Thus, they are less prone to industrial accidents.
(iv) Reduction of Turnover and Absenteeism:

Training creates a feeling of confidence in the minds of the workers. It gives them a security at
the workplace. As a result, labour turnover and absenteeism rates are reduced.

(vi) Technology Update:

Technology is changing at a fast pace. The workers must learn new techniques to make use of

advance technology. Thus, training should be treated as a continuous process to update the
employees in the new methods and procedures.

(vii) Effective Management:

Training can be used as an effective tool of planning and control. It develops skills among

workers and prepares them for handling present and future jobs. It helps in reducing the costs

of supervision, wastages and industrial accidents. It also helps increase productivity and quality
which are the cherished goals of any modern organization.

Methods of Training: On-the-job Training Method and Off-the-Job Methods!

Management development is a systematic process of growth and development by which the

managers develop their abilities to manage. It is concerned with not only improving the
performance of managers but also giving them opportunities for growth and development.

There are two methods through which managers can improve their knowledge and skills. One is

through formal training and other is through on the job experiences. On the job training is very
important since real learning takes place only when one practices what they have studied.

But it is also equally important in gaining knowledge through classroom learning. Learning

becomes fruitful only when theory is combined with practice. Therefore, on the job methods
can be balanced with classroom training methods (off-the-job methods).
1. On-the-job Training (OJT) Methods:

This is the most common method of training in which a trainee is placed on a specific job and
taught the skills and knowledge necessary to perform it.

On-the-job training allows employees to learn by actually performing a specific job or task. The
employee will perform the job and learn as he goes. On-the-job training can be structured by
using hands-on application supported by classroom-type instruction. It can also be unstructured
using only hands-on application.
Cookie hired a new candy wrapper named Patti. Patti had no experience working in a candy
factory. In fact, Patti had no experience working on an assembly line either. Cookie used
unstructured on-the-job training to teach Patti how to do her job. This method works well for
the job of candy wrapping. As the candies move along the assembly line, Patti learned how to
wrap each candy while working alongside a more experienced candy wrapper. The more
experienced candy wrapper showed Patti exactly how to wrap candies, how to time the
assembly line and how to detect irregularly shaped candies. If Patti made a mistake, the trainer
would be able to correct it immediately.

The advantages of OJT are as follows:

1. On the job method is a flexible method.

2. It is a less expensive method.

3. The trainee is highly motivated and encouraged to learn.

4. Much arrangement for the training is not required.

The disadvantages of this method are:

 Can slow down production for the trainer

 Can disrupt the workflow

On-the-job training methods are as follows:

1. Job rotation:

This training method involves movement of trainee from one job to another gain knowledge

and experience from different job assignments. This method helps the trainee understand the
problems of other employees.
2. Coaching:

Under this method, the trainee is placed under a particular supervisor who functions as a coach

in training and provides feedback to the trainee. Sometimes the trainee may not get an
opportunity to express his ideas.

3. Job instructions:

Also known as step-by-step training in which the trainer explains the way of doing the jobs to
the trainee and in case of mistakes, corrects the trainee.

4. Committee assignments:

A group of trainees are asked to solve a given organizational problem by discussing the
problem. This helps to improve team work.

5. Internship training:

Under this method, instructions through theoretical and practical aspects are provided to the

trainees. Usually, students from the engineering and commerce colleges receive this type of
training for a small stipend.

2. Off-the-job Methods:

On the job training methods have their own limitations, and in order to have the overall

development of employee’s off-the-job training can also be imparted. The methods of training

which are adopted for the development of employees away from the field of the job are known
as off-the-job methods

The following are some of the off-the-job techniques:

1. Case study method:

Usually case study deals with any problem confronted by a business which can be solved by an

employee. The trainee is given an opportunity to analyse the case and come out with all
possible solutions. This method can enhance analytic and critical thinking of an employee.
2. Incident method:

Incidents are prepared on the basis of actual situations which happened in different

organizations and each employee in the training group is asked to make decisions as if it is a

real-life situation. Later on, the entire group discusses the incident and takes decisions related
to the incident on the basis of individual and group decisions.

3. Role play:

In this case also a problem situation is simulated asking the employee to assume the role of a

particular person in the situation. The participant interacts with other participants assuming

different roles. The whole play will be recorded and trainee gets an opportunity to examine
their own performance.

4. In-basket method:

The employees are given information about an imaginary company, its activities and products,

HR employed and all data related to the firm. The trainee (employee under training) has to

make notes, delegate tasks and prepare schedules within a specified time. This can develop
situational judgments and quick decision making skills of employees.

5. Business games:

According to this method the trainees are divided into groups and each group has to discuss
about various activities and functions of an imaginary organization. They will discuss and decide

about various subjects like production, promotion, pricing etc. This gives result in co-operative
decision making process.

6. Grid training:

It is a continuous and phased programme lasting for six years. It includes phases of planning

development, implementation and evaluation. The grid takes into consideration parameters
like concern for people and concern for people.
 7. Lectures:

This will be a suitable method when the numbers of trainees are quite large. Lectures can be

very much helpful in explaining the concepts and principles very clearly, and face to face
interaction is very much possible.

8. Simulation:

Under this method an imaginary situation is created and trainees are asked to act on it. For e.g.,

assuming the role of a marketing manager solving the marketing problems or creating a new
strategy etc.

9. Management education:

At present universities and management institutes gives great emphasis on management

education. For e.g., Mumbai University has started bachelors and postgraduate degree in

Management. Many management Institutes provide not only degrees but also hands on
experience having collaboration with business concerns.

10. Conferences:

A meeting of several people to discuss any subject is called conference. Each participant

contributes by analyzing and discussing various issues related to the topic. Everyone can
express their own view point.

ADVANTAGES OF INDUSTRIAL TRAINING

 First-hand experience working as an engineering professional

 Apply your technical knowledge and engineering methods to a real-life situation.
 Work with other engineering professionals
 Experience what it’s like to work in a professional organisation
 Increase your technical, interpersonal and communication skills, both oral and written
 Observe interactions of engineers with other professional groups
 Witness the functioning and organisation of business and companies
PSYCHOLOGICAL TEST

Definition
Psychological tests are written, visual, or verbal evaluations administered to assess the
cognitive and emotional functioning of children and adults
Purpose
Psychological tests are used to assess a variety of mental abilities and attributes, including
achievement and ability, personality, and neurological functioning.
For children, academic achievement, ability, and intelligence tests may be used as tools in
school placement, in determining the presence of a learning disability or a developmental
delay , in identifying giftedness, or in tracking intellectual development. Intelligence testing may
also be used with teens and young adults to determine vocational ability (e.g., in career
counselling).
Personality tests are administered for a wide variety of reasons, from diagnosing
psychopathology (e.g., personality disorder, depressive disorder) to screening job candidates.
They may be used in an educational setting to determine personality strengths and
weaknesses.
Description
Psychological tests are formalized measures of mental functioning. Most are objective and
quantifiable; however, certain projective tests may involve some level of subjective
interpretation. Also known as inventories, measurements, questionnaires, and scales,
psychological tests are administered in a variety of settings, including preschools, primary and
secondary schools, colleges and universities, hospitals, outpatient healthcare settings, and
social agencies. They come in a variety of formats, including written, verbal, and computer
administered.

Achievement and ability tests

Achievement and ability tests are designed to measure the level of a child's intellectual
functioning and cognitive ability. Most achievement and ability tests are standardized, meaning
that norms were established during the design phase of the test by administering the test to a
large representative sample of the test population. Achievement and ability tests follow a
uniform testing protocol, or procedure (i.e., test instructions, test conditions, and scoring
procedures) and their scores can be interpreted in relation to established norms. Common
achievement and ability tests include the Wechsler intelligence scale for children (WISC-III) and
the Stanford-Binet intelligence scales .

Personality tests
Personality tests and inventories evaluate the thoughts, emotions, attitudes, and behavioral
traits that comprise personality. The results of these tests can help determine a child's
personality strengths and weaknesses, and may identify certain disturbances in personality, or
psychopathology. Tests such as the Minnesota Multiphasic Personality Inventory for
Adolescents (MMPI-A) and the Millon Pre-Adolescent Clinical Inventory III (M-PACI), are used to
screen children for specific psychopathologies or emotional problems.
Another type of personality test is the projective personality assessment . A projective test asks
a child to interpret some ambiguous stimuli, such as a series of inkblots. The child's responses
provide insight into his or her thought processes and personality traits. For example, the
Holtzman Ink blot Test (HIT) uses a series of inkblots that the test subject is asked to identify.
Another projective assessment, the Thematic Apperception Test (TAT), asks the child to tell a
story about a series of pictures. Some consider projective tests to be less reliable than objective
personality tests. If the examiner is not well-trained in psychometric evaluation, subjective
interpretations may affect the evaluation of these tests.

Neuropsychological tests
Children and adolescents who have experienced a traumatic brain injury, brain damage, or
other organic neurological problems, are administered neuropsychological tests to assess their
level of functioning and identify areas of mental impairment. Neuropsychological tests may also
be used to evaluate the progress of a patient who has undergone treatment or rehabilitation
for a neurological injury or illness. In addition, certain neuropsychological measures may be
used to screen children for developmental delays and/or learning disabilities.

Precautions
Psychological testing requires a clinically trained examiner. All psychological tests should be
administered, scored, and interpreted by a trained professional, preferably a psychologist
or psychiatrist with expertise in the appropriate area.
Psychological tests are only one element of a psychological assessment. They should never be
used as the sole basis for a diagnosis. A detailed clinical and personal history of the child and a
review of psychological, medical, educational, or other relevant records are required to lay the
groundwork for interpreting the results of any psychological measurement.
Cultural and language differences among children may affect test performance and may result
in inaccurate test results. The test administrator should be informed before psychological
testing begins if the test taker is not fluent in English and/or belongs to a minority culture. In
addition, the child's level of motivation may also affect test results.

Preparation
Prior to the administration of any psychological test, the administrator should provide the child
and the child's parent with information on the nature of the test and its intended use, complete
standardized instructions for taking the test (including any time limits and penalties for
incorrect responses), and information on the confidentiality of the results. After these
disclosures are made, informed consent should be obtained from the child (as appropriate) and
the child's parent before testing begins.

Normal results
All psychological and neuropsychological assessments should be administered, scored, and
interpreted by a trained professional. When interpreting test results, the test administrator will
review with parents what the test evaluates, its precision in evaluation, any margins of error
involved in scoring, and what the individual scores mean in the context of overall test norms
and the specific background of the individual child.
Risks
There are no significant risks involved in psychological testing.
Parental concerns
Test anxiety can have an impact on a child's performance, so parents should not place undue
emphasis on the importance of any psychological testing. They should speak with their child
before any scheduled tests and reassure them that their best effort is all that is required.
Parents can also ensure that their children are well-rested on the testing day and have a
nutritious meal beforehand.
TOPIC 4: INTRODUCTION TO VARIOUS TRANSPORT SYSTEMS

Transport (British English) or transportation (American English) is the movement of people and
goods from one place to another.

MEANS OF TRANSPORT:

The means of transport are classified on the basis of the way, the vehicle, the motive power
used and terminals.

1. LAND TRANSPORT

Pathways: In remote villages, forest and hilly areas pathways are still an important amongst the
different modes of transport. It further be subdivided into Head loads (is also known as human
transport. It is used in the hilly areas where even animals cannot reach) and Pack animals (is
also known as animal transport. It is used in the backward areas. The animals like horse, pony,
donkey, ass, buffaloes, camel, elephant, yak, sheep etc. are used for this purpose.

Roadways: Road Transport is one of the most important modes of transport. The history of
Road Transport started from ancient civilizations. Gradually it becomes more and more popular
means of transport. Road Transport further subdivided into Vehicular Transport (Cars, Trucks,
Buses, Lorries, Auto-rickshaws, Bullock Carts, Tongas, Tumtums, and Hand Carts etc.) and
Non-vehicular Transport (Hamals, Animals like Camel, Dogs, Elephant, Horse, Mules etc.)

Tramways: Tramway is one of the cheaper, longer, quicker and safer modes of Land Transport
which is suitable in large cities. However due to certain limitations like slowly ness, huge
investment, inflexibility etc. gradually it replaced by other means of Land Transport.

Railways: Railway has been the pioneer of modern mechanical transport. It has brought the
greatest revolution in transport. It accelerated commercial and industrial development of various
countries. Until the introduction of Motor Transport, Railway had the monopoly as the Land
Transport. In India, it is the principal means of transport. It carries over 80 per cent of goods
traffic and over 70 per cent of passenger traffic. It provides for more than 60000 kilometers of
railways all over the country.

2. WATER TRANSPORT

Water transport is the cheapest and the oldest form of transport for heavy goods and bulk
cargoes. Waterways are the natural gifts, hence it does not required large amount of capital
expenditure for the construction of road and railway tracks, except canal transport, as in the
case of land transport. In addition to that the cost of running is also very less.

A. INLAND WATERWAY

Inland waterways may be subdivided into

River Transport: Rivers are the water highways given by nature. River Transport is suitable for
small boats and steamers. It was highly developed in the pre-railway days. But with the
development of railways, river transport was neglected and decayed gradually.
Canal Transport: Canals are the artificial waterways constructed for the purpose of navigation
and irrigation.

B. OCEAN TRANSPORT

Ocean Transport or shipping may be subdivided into

Coastal Shipping: Coastal shipping is a cheaper, speedy, flexible and economical form of
transport for the movement of bulky and heavy cargoes. Usually coastal shipping trade is
reserved for the national shipping. In India also from 1951 and onwards the coastal shipping
trade is extremely reserved for the national ships.
Overseas Shipping: On the basis of their working, overseas shipping may be divided into The
Liner (those ships which follow defined routes with fixed places and fixed time table), The
Tramps (those ships which have no set routes or fixed time table) and The Oil Tanker (special
sea carriers of crude oil in very large quantity). The Liners may again be subdivided into
Passenger Liners and the Cargo Liners.

C. AIR TRANSPORT

Air transport is the gift of twentieth century to the world. It is the latest means of transport. The
first flight in the air was made in 1903.only for twelve seconds. Successfully it was used as a
means of transport after the First World War (1914-1918). The first air service was started in
1919 between London and Paris. Since then it has made notable progress and provide tough
competition to Railways.
Air Transport can again be subdivided into passenger and cargo.

ADVANTAGES OF MOTOR TRANSPORT:

1. Less Capital Outlay:

Road transport required much less capital Investment as compared to other modes of transport
such as railways and air transport. The cost of constructing, operating and maintaining roads is
cheaper than that of the railways. Roads are generally constructed by the government and local
authorities and only a small revenue is charged for the use of roads.
2. Door to Door Service:
The outstanding advantage of road transport is that it provides door to door or warehouse to
warehouse service. This reduces cartage, loading and unloading expenses.
3. Service in Rural Areas:
Road transport is most suited for carrying goods and people to and from rural areas which are
not served by rail, water or air transport. Exchange of goods, between large towns and small
villages is made possible only through road transport.
4. Flexible Service:
Road transport has a great advantage over other modes of transport for its flexible service, its
routes and timings can be adjusted and changed to individual requirements without much
inconvenience.
5. Suitable for Short Distance:
It is more economic and quicker for carrying goods and people over short distances. Delays in
transit of goods on account of intermediate loading and handling are avoided. Goods can be
loaded direct into a road vehicle and transported straight to their place of destination.
6. Lesser Risk of Damage in Transit:
As the intermediate loading and handling is avoided, there is lesser risk of damage, breakage
etc. of the goods in transit. Thus, road transport is most suited for transporting delicate goods
like chinaware and glassware, which are likely to be damaged in the process of loading and
unloading.
7. Saving in Packing Cost:
As compared to other modes of transport, the process of packing in motor transport is less
complicated. Goods transported by motor transport require less packing or no packing in
several cases.
8. Rapid Speed:
If the goods are to be sent immediately or quickly, motor transport is more suited than the
railways or water transport. Water transport is very slow. Also much time is wasted in booking
the goods and taking delivery of the goods in case of railway and water transport.
9. Less Cost:
Road transport not only requires less initial capital investment, the cost of operation and
maintenance is also comparatively less. Even if the rate charged by motor transport is a little
higher than that by the railways, the actual effective cost of transporting goods by motor
transport is less. The actual cost is less because the motor transport saves in packing costs and
the expenses of intermediate loading, unloading and handling charges.
10. Private Owned Vehicles:
Another advantage of road transport is that big businessmen can afford to have their own motor
vehicles and initiate their own road services to market their products without causing any delay.
11. Feeder to other Modes of Transport:
The movement of goods begins and ultimately ends by making use of roads. Road and motor
transport act as a feeder to the other modes of transport such as railways, ships and airways.
TOPIC 5: Responsibility and authority of Divisions of Traffic Department

 ADMINISTRATIVE DEPARTMENT

The commander of the Bureau of Operations and Investigations is responsible for the
department's traffic function, to include planning, analysis, monitoring, and
coordinating the department's traffic activities. The bureau commander's primary
support components in meeting this responsibility are the Bureau of Patrol district
commanders, and the Special Operations Division commander.

 Secretary/Dy. Secretary (P&IR) Paradip Port Trust

1. Recruitment, Seniority & Confirmation of Cl-I, II, III & IV posts (cadres controlled by
Admn. Deptt.)
2. Maintenance of personal file of Cl-I & II Officers.
3. Sanction of leave, LTC, Medical Reimbursement, and Festival Advance of HoDs of PPT.
4. Forwarding of applications of Cl-I & II officers to other Major Ports and other
organizations.
5. Issue of No Objection Certificate for acquiring Indian Pass Port.

 Hindi Officer/ Hindi Pradhyapak

1. Operation of Hindi Teaching Scheme of Govt. of India. Arrangement of classes for

imparting Hindi Training to PPT officers/Employees & other Central Govt. offices and
conducting Hindi Examinations thereon
2. Implementation of Official Language policy in Port Trust as well as in other Central Govt.
Offices located at Paradip.
3. Conducting Hindi Workshops for better use of Hindi in Official work
4. Conducting meeting of Official Language Implementation Committee of PPT and Town
Official Language Implementation Committee constituted in the Port Township and
preparation of bilingual minutes
5. Correspondence with Ministries/Other offices in Hindi. Sending replies to
Ministries/Parliamentary Committee.

 Hindi Translator

1. Liaisoning with other offices for Hindi Training and implementation of Official Language.
2. Operating Incentive Scheme to encourage the Officers/employees to work in Hindi
3. Preparation of Annual Administrative Report and Annual Accounts in Hindi.

 Deputy Secretary ( Gen.)

1. Works of Trust Board Meeting.

2. Parliament and Assembly question and reply there of Quarterly EMI Report.
3. Preparation of statement of Superior staff of PPT.

4. Desk note of Chairman, PPT

 Asst. Secretary

1. Looking after payment to IPA, Payment to Trustee, payment to all employee’s pay and
allowances, payment to Contractor labour.
2. Looking after all office Estt. Work (i.e., Main Wing, Estate Wing, PRO Wing & School
Wing) & disposal of various issues thereon
3. Pension & pensionary benefits of employees & officers working under this department
4. Looking after all watch and ward/contract works involving tender bills for payment to
firms under Admn. Deptt.
5. Deals with office furniture stationary purchase and other related issues – indenting
thereof

 Deputy Secretary(Law)

1. Proposal is placed before Chairman through Secretary for engagement of Legal

Consultants & Assistant Legal Consultants
2. After obtaining approval of the Chairman, Paradip Port Trust concerned Department is
contacted
3. Para-wise Comments is examined and sent to Legal Consultant or Assistant Legal
Consultant for preparation of Counter
4. Contact is made with the concerned Department for deputation of any Officer to swear
Affidavit
5. Payments of fees bill of Legal Consultants and Assistant Legal Consultants as per the
Fees Structure approved by the Chairman, Paradip Port Trust.

 ENGINEERING DEPARTMENT
1. CE

1. Preparation of Annual Plan, Action Plan with conception planning, details set up of
infrastructural and developmental activities plans.
2. Preparation of Annual Plan, Action Plan with conception planning, details set up of
infrastructural and developmental activities plans.
3. Deciding various sizes of projects under NMDP, 5th Five Years Plan in co-ordination with
other departments under Plan and Non-Plan schemes
4. Monitoring of expenditure relating to Plan, Non-Plan, Revenue Works, liaisoning with
other Departments.
5. Preparation of various returns such as Monthly, Quarterly, Annually including replies to
the Ministry.

2. EE PHD (M)

1. Submission of estimates, proposals related with the water supply system to the
township & pump houses related with Balijhara water works etc.
2. Operation and maintenance of water treatment plant consisting raw water reservoir,
purification and treatment plant, raising main, over head tanks, pump house and entire
pipe net work
3. Residential building complain register for maintenance of building / quarters.
4. Water sample test register.

3. EE R&B

1. Submission of estimates, proposals related with the township development,

maintenance of the residential quarters, roads non-residential buildings etc.
2. Residential building complain register for maintenance of building / quarters.
3. Residential building complain register for maintenance of building / quarters for public
health works.

4. CHIEF MECHANICAL ENGINEER

1. Operation & Maintenance of Iron Ore Handling Plant, Locomotives, Central
Workshop, Heavy Equipment Section, Mechanised Coal Handling Plant, materials
Management Division.
2. Maintenance of Electrical Distribution System for Harbour & Township area.
3. Execution of new projects, repair & renovation of existing facilities and survey
reporting of unserviceable Equipment/POL for disposal under E&M Department.

 EXECUTIVE ENGINEER(PED)

1. The EE,PED-I, EE-PED-II and EE(Revenue) reports to the CME through the
SE(E) and Dy. CEE.
2. They are responsible for receipt of 132 KV Power from CESCO, distribution
of power in port area, E/I to new buildings, night navigation facilities, repair
maintenance of HT/LT transformers, D.G. Set , AC's, EPABX system and
execution of development projects.
3. They have to interact with port users, CESCO officials, electrical inspector
and other govt. officials for their day to day functions.
4. They are authorized to take decisions on their respective matters.

 TRAFFIC DEPARTMENT

This directive establishes the department's traffic function. The major activities of the traffic
function include:
A. General traffic enforcement
B. Selective traffic enforcement
C. General accident investigation
D. Specialized accident investigation
E. Operation of speed measuring devices
F. Operation of chemical testing equipment
G. Traffic safety education
H. Liaison with traffic safety and traffic engineering groups
I. Traffic direction and control
 J. Provision of emergency and towing services to motorists K. Identification and correction
of roadway hazards
L. Removal of abandoned vehicles

Role of Traffic Analysts

Traffic analysts will perform traffic analysis and enforcement duties as assigned by the
Traffic Safety Section commander in consultation with the affected district commanders.
The primary role of the traffic analyst is to provide written traffic accident analyses and
reports to the Traffic Safety commander and the Bureau of Patrol district commanders, for
use in the deployment of selective traffic enforcement officers. Analysis of traffic accidents
will include geographic, temporal, and causative factors. Traffic analysts must be cognizant
of other problems in the districts, such as:
1. Locations generating repeated requests from citizens for radar enforcement.
2. Residential and commercial locations generating high volumes of parking complaints
3. Traffic problems that can only be corrected or improved by traffic engineering.

THE ROLE AND IMPORTANCE OF THE TRAFFIC DEPARTMENT IN THE TRAFFIC LAW
ENFORCEMENT SYSTEM

In a broad interpretation of the conception of traffic law enforcement we can also include
activities and competencies of the Traffic Department despite the fact that this department
does not exercise perform control over individual road users. The Traffic Department is
organisationally linked to the Administrative Internal Affairs Directorate. Its tasks are
controlling the issuing of driving licences, technical inspections and registration of motor
vehicles and tractor trailers, the functioning of driving schools and examination centres, as well
as regulating sports entertainments on public roads. Six inspectors and department chief
working in this department. Fifty-eight local administrative units with their traffic sections work
in local areas. A special relation exists between the traffic department and the local
administrative units (traffic sections). The traffic department gives local administrative units
some professional advice, assistance and obligatory instructions. It also makes decisions about
complaints against written orders or other individual acts of the local administrative units.
The Road Traffic Act defines the main police tasks and warrants (there are over 40).All road
safety tasks of the Ministry of the Interior can be separated into three parts:

 observation, keeping records and analysing road safety occurrences,

 planning, performing and valuing police road safety process and
 co-operating with state and private organisations which activities have influence on
road safety.

 SECRETARIAL DIVISION

ESSENTIAL DUTIES AND RESPONSIBILITIES:

Maintain fuel system operation, including records of fuel delivery and consumption; computer
data up-dates, configuring and dispensing of fuel cards, and monthly fuel reports.

• Process purchase orders to Cintax system and budget reports for the Transportation
department.

• Maintain special needs, homeless, kindergarten, summer and after school runs.

• Maintain motor pool work orders.

• Monthly billing of all fuel cost to appropriate departments.

• Maintain records and process all payroll and personnel absentee logs, time sheets, and track
Personal Leave requests.

• Organize vendor receipts and invoices for processing by the District Accounts Payable
department.

• Prepare a variety of reports, including state ridership report.

• Be aware of ongoing activities in the department and be able to deal with emergencies,
interruptions, and changing needs.

• Answer phones and radio; take message, greet visitors and radio dispatch when needed.

• Assist with vehicle rentals for district staff and maintain website.

• Assist with paperwork for drug and alcohol testing for bus drivers.

• Complete various District data entry assignments as needed.

• Maintain and organize office files.

• Other duties as assigned by the Director of Transportation

TOPIC 6: CHAIN OF RESPONSIBILITIES, FORM OF OWNERSHIP (STATE,

MUNICIPALITY AND PRIVATE UNDERTAKING)
A.1. WHAT IS CHAIN OF RESPONSIBILITY?
The chain of responsibility is a policy concept used in Australian transport legislation to place
legal obligations on parties in the transport supply chain or across transport industries
generally. The concept was initially developed to apply in the heavy vehicle industry in
regulated areas such as speeding, fatigue and mass, loading and dimension. It has since spread
to other transport sectors, particularly in Victoria where it has been applied in laws which apply
to the rail, bus, marine and taxi industries. The chain of responsibility refers to the chain of
people involved in transporting of goods by road. It extends the liability for road law offences to
include several off-road parties who have previously not been liable for such offences. Under
the chain of responsibility, every person is held accountable for conduct that affects compliance
in a transport operation and may be deemed liable in the event of a breach of the legislation
through their actions or inactions.A.2. WHERE DID CHAIN OF RESPONSIBILITY COME FROM?

The chain of responsibility concept initially developed out of a recognition that unlawful
behavior by truck drivers is influenced and often controlled by the actions of other parties.
Concerns arose that transport laws had often focused on the actions of drivers while failing to
sufficiently recognize and regulate the actions of other key parties. Chain of responsibility laws
therefore seek to provide that these other parties cannot encourage, create incentives for,
demand or allow drivers to undertake unlawful actions.

The chain of responsibility concept is the cornerstone of the National Road Transport Reform
(Compliance and Enforcement) Bill. The Bill is a set of model provisions developed by the
National Transport Commission in consultation with key stakeholders, including
Commonwealth, State and Territory road transport agencies, police and the road transport
industry. The Bill provides for the adoption in all jurisdictions of nationally consistent legislation
in relation to enforcement powers, risk-based offence classifications, reasonable steps defense,
sanctions and penalties, liability and evidentiary provisions. The Bill establishes a framework for
improved compliance outcomes across the road transport industry, ensuring increased road
safety, benefits for infrastructure and the environment, and the minimization of unfair
competitive advantage and adverse impacts of road transport on the community. Australian
transport ministers approved the Bill for implementation in all jurisdictions on 3 November
2003.
A.3. WHY C.O.R. HAS BEEN INTRODUCED?
The chain of responsibility legislation has been introduced in Western Australia in the
interests of national consistency to replicate the provisions of the National Road Transport
Reform (Compliance and Enforcement) Bill. The legislation was passed by the State
Government in May 2012. The laws have been introduced in order to: provide an effective,
efficient and equitable scheme for encouraging compliance with the requirements of the
road transport law and for the

enforcement of those requirements; make a demonstrable, positive change in the on-road

behaviour of those involved in the transport industry; recognise the off-road parties who
affect road transport compliance and making those parties answerable for their acts and
omissions; and create an environment of accountability and fair competition that offers no
incentives for non-compliance and promotes a level playing field.

A.4. IMPACT OF C.O.R.

The Victorian work has had influence beyond that State. Following the enactment of the
Victorian Rail Safety Act in early 2006, Australian Transport Ministers approved a national
Model Rail Safety Bill in June 2006 which drew heavily on the Victorian work including its
adaption of the chain of responsibility concept. The national Bill proposal has since been
adopted by all other States and Territories which have passed Rail Safety Acts reflecting the
framework.

OWNERSHIP IN TRANSPORTATION
Under conventional forms of government ownership and provision, responsibility for road
provision is divided between federal, state, and local government. Federal and state
governments have primary responsibility for arterial roads, with states also operating some
more heavily-used collector roads. Local governments provide some combination of
collector and local roads. In addition, some local roads may be provided by non-
governmental organizations, such as homeowners' associations and individual private
landowners (as in the case of apartment complexes).

One could also conceive of roads being provided under a public utility framework, where
responsibility for maintenance and operation of the roads was transferred to a quasi-public
authority. This might be an acceptable way to provide the network of linking collectors that
connect local roads with higher-level arterials (limited-access highways) and serve both
access and mobility functions.
Alternately, the private sector can be involved in the provision of roads to varying degrees.
Most public works and transportation departments involve the private sector to at least a
minimal degree in such activities as planning, design, construction and maintenance.
The more limited forms of private involvement in road provision tend to involve the
outsourcing of road design, construction and maintenance activities to private consulting
and construction firms. Private contractors may enter into service contracts with
government agencies to provide certain specified operations and maintenance activities.
These contracts may apply to all classes of publicly-owned roads. Outsourcing may also
apply to more comprehensive management contracts, in which the contractor may be
responsible for the design and construction of a road (often under so-called design-build
project delivery systems), sometimes coupled with provisions for operations and major
maintenance activities. These types of contracts often are applied to the construction of
new arterial roads in cases where a public authority is unwilling to give up full control of a
project.

B.1. STATE OWNERSHIP

State owned transport systems are those transportation facilities which are being controlled
by government of that state. This can be of two type federal control i.e. central control of
transport system and controlling can be done on local government level.

The public sector may play a role as facilitator in the provision of infrastructure.
Government agencies may provide planning and coordination activities in anticipation of the
development of an infrastructure project, possibly including the assembly of land for right-
of-way (which in some cases may require the use of eminent domain powers). Some public
entities will also offer financial inducements to facilitate the provision of infrastructure. In
addition to some of the tax advantages offered to private investors in the financing of
infrastructure projects (which will be discussed in the next section), public entities may
sometimes provide matching grants to encourage private investment. A more traditional
role of the public sector in facilitating private investment has been for the state to act as a
broker for infrastructure projects, combining its traditional coordination activities with the
discretion to select a private developer for an infrastructure project from among multiple
competing proposals.

B.2. MUNICIPALITY OWNERSHIP

In this type control of transportation ownership, rest in hand of local municipality
Authorities of area.
Many municipal corporations operates their bus in cities on popular routes. Unlike buses,
roads are not
easily contestable. Buses tend to have low fixed costs and higher variable costs, which
implies few barriers to entry. The roads most likely to be private (limited-access roads)
under the framework discussed previously also tend to be more costly to provide and
entail high fixed costs. In this case, market power is a serious consideration. Many limited-
access highways function essentially as local monopolies, making the introduction of
direct competition difficult.

B.3. PRIVATE UNDERTAKING

One industry within the transportation sector where privatization has gained
momentum in recent decades has been bus transit, particularly urban (intercity) bus
services. The relatively low fixed costs associated with provision of bus services provide
the potential for a market with relatively low barriers to entry and intense competition.

The first type of privatization is the sale of former state-owned business (public enterprises).
During the 1980s, many governments in Europe and the developing world (South America in
particular) initiated the sale of state-owned enterprises. Western European countries, led by
France and the United Kingdom, were eager to return to the private sector many industries
that were nationalized following World War II. These industries included public utilities,
transportation, and some heavy industry (e.g. British Steel in the UK). Similar developments
were taking place in the developing world, led by South American countries such as Chile
and Argentina. The rationale was largely the same: a belief that the private sector could
operate such enterprises more efficiently. Around the same time, the collapse of the Soviet
Union and the dissolution of the former Communist Bloc left many Eastern European
countries to make the transition toward a market economy. This transition affected the
transportation sector in a large number of countries, where governments were eager to
promote private sector participation in functions such as the provision of urban and
intercity bus services. Reviews of early experiences with such reforms have started to
appear for countries such as Poland and Hungary.
TOPIC 7: PRINCIPLE FEATURES OF OPERATING COST FOR TRANSPORT
VEHICLE WITH EXAMPLES OF OPERATING COST

What is Operating Cost?

Operating costing is an extension and refined form of process costing. It is also more or less
very similar to single or output costing. The operating costing gives more emphasis on
providing services rather than the cost of manufacturing an article. The services provided
may be for sale to the general public or they may be provided within an organization.
The operating costing is also called as service costing, period costing or terminal costing.
Service costing means rendering service to the public or to an organization for which cost is
accumulated and calculated. Period costing means the costs data collected and calculated
for a specific period. Terminal costing means a bus or truck of a transport undertaking
chartered for a specific trip.
According to ICMA, London Operating Cost is defined as:
Operating cost is that form of operation costing which applies where standardised
services are provided either by undertaking or by a service cost centre within an
undertaking.
According to Wheldon, Operating Cost is defined as:
Operating cost is actually unit costing as applied to the costing of services.

Features of Operating Cost

The basic features of operating costing are presented below.
1. Uniform service is provided to all the customers.
2. The costs are classified into fixed and variable.
3. The fixed and variable cost classification is necessary to ascertain the cost of service and
the unit cost of service.
4. There is no physical stock of article if an undertaking renders a service.
5. If a cost centre is operating for an undertaking, there is no sale of service but render the
service. In other words, if a cost centre is operating for public, it sells its service to the
public.
6. The cost unit may be simple in certain cases or composite or compound in other cases like
transport undertakings.
7. Total costs are averaged over the total amount of service rendered.
8. The costs are collected from the authentic documents like daily log sheet, operating cost
sheet, boiler house cost sheet, canteen cost sheets etc.
9. Operating cost is the cost of rendering service.
10. Operating costing is the method of ascertaining costs.
11. The productive enterprises can quote prices by ascertaining cost data.

Different methods exist and have been developed through various Austroads studies. There
has been a stated requirement to provide models that possess the following attribute, and
that can be applied and updated in a clear and consistent manner:
 To better accommodate changes in vehicle technology and a changing vehicle fleet,
including under different loading conditions and regulations
 To be amenable for application across networks subject to uninterrupted and
interrupted/stop-start conditions
 To be capable of application to general cost-benefit analysis studies at a network
level and for major capital projects, including employing the results of traditional 4–5
stage transport models.

VOC Components:
Individual items associated with vehicle operation on which expenses are directly incurred.
Include the costs of:
 Energy needed to propel the vehicle fluids
 Other light consumables associated with mechanical working of the drive-train.
 Occasional replacement of the vehicle’s contact surfaces with the guideway.
 Vehicle repair and maintenance, and
 Vehicle depreciation

Fuel:
 Is a key component of vehicle operating costs (50-75% of all VOC)
 Factors affecting total fuel cost:
 Amount of fuel used
 Fuel efficiency
 Fuel price
 Vehicle factors affecting fuel efficiency/consumption rate:
 vehicle class, age, type, speed
 Highway factors affecting fuel consumption rate:
 highway class
  steep grades
 sharp horizontal curves
 congestion conditions
 Unit costs of fuel:
 7 cents per vehicle-mile for autos
 21 cents per vehicle-mile for large trucks
 Sources of published data on fuel cost:
 automobile associations, petroleum institutes, and government energy
agencies
Lubricating Oil
 Includes engine oil, transmission fluids, brake fluids, and other oil consumables
 Help smooth/safe operation of vehicle engine and drive-train
 Oil cost is a product of unit price ($/quart) and consumption rates (quarts/mile).
 Oil consumption rate depends on:
 Amount of usage
 Traffic characteristics (speed, delay, etc.)
 Facility characteristics (grade, curves, etc.)
 Oil costs may be reported
 separately from Fuel costs
 together with fuel costs combined
 Oil costs range $1.73 to $4.32 per quart (FHWA, 2002).

Wheels
Preservation of the Vehicle-Guideway-Contact Surface
 At the points of contact with the guideway, the vehicle’s contact surfaces experience
deterioration due to wear and tear.
 Vehicle “contact surface” is
 For highways and runways: the tire
 For rail: a steel wheel.
 Tires costs (2005$):
 $54.71/tire for small autos
 $86.54 fo r medium/large autos,
 $95.38 for 4-tire single unit trucks,
 $230.10 for 6-tire single unit trucks,
 $569.74 for 3+ axle single unit trucks,
 $569.74 for 3 –4 axles, and
 $569.74 for combination trucks.
 Following VOC factors mostly affect this VOC component:
 pavement condition
 grade–curvature, and
  speed changes (Thoresenand Roper, 1996).

Vehicle Repair and Maintenance

 After a certain level of usage, some parts vehicle of need:
 Repair
 replacement or replenishment
 Examples:
 Major electrical parts (batteries, alternators, etc.)
 Fuel pumps
 Air pumps
 Tire rims
 Minor electrical parts (bulbs, fuses, wires, etc.)
 In some VOC estimation methodologies, cost of vehicle R&M not reported separately
but added to other non-fuel costs.
 Cost of vehicle R&M:
 4.7 per vehicle-mile for small/medium vehicles
 9.3 cents per vehicle-mile for trucks (AAA, 2005)
 Vehicle repair and maintenance are influenced by pavement condition, curvature,
and to a lesser extent, speed, grade, and speed change.

Vehicle Depreciation
 Is a function of:
 usage (miles of travel)
 age (years since manufacture).
 Mileage-based depreciation rates are similar across vehicle types
  Cars: low cost but short service lives
 Trucks: high cost but long service lives
 Mileage-based depreciation costs significant fraction of overall VOC
 In some literature, the cost of vehicle depreciation is reported together with other
nonfuel costs.
 Depreciation rates are influenced by:
 geometrics (curves, grade)
 congestion
 speed
 weather, etc.

 Transportation improvements often produce:

 smoother pavement
 improved driving conditions (through reduced stop-and-go situations)
 increased speed
 thus: reduced depreciation
Vehicle Inventory
 Applicable only to cargo (freight transportation)
 In transporting perishable or valuable cargo, client incurs holding costs which
represent an opportunity cost
 If at the beginning of the shipment, the client had a cash amount worth the
cargo being shipped, such amount would have earned some interestby the
time the cargo reaches its destination.
 So by having the cargo transported, client forgoes some benefits.
 Greater the cargo value, higher the inventory costs
 Longer time spent in transporting the goods, higher the inventory costs
 More perishable the cargo, higher the inventory costs
 Inventory cost computation:
 Hourly discount rate * average value of shipment
 Inventory costs of cargo expressed in $/vehicle-mile
 The most significant VOC factors that affect the shipping inventory costs are speed
and delay,
 Cargo value and interest rate are also influential.
 For example, shipping $100,000 cargo at 10% interest rate:
 Truck A traveling at 50 mph 6 cents per mile
 Truck B traveling at 60 mph 2.5 cents per mile
TOPIC 8: FARE STRUCTURE AND METHOD OF DRAWING UP OF A FARE TABLE

FARE

A fare is fee paid a passenger for use of a public transport system: train, bus, taxi etc. In case
of air transport system the term air fare is used.

Fare structure is the system set up to determine how much is to be paid by various
passengers using a transit vehicle at any given time.

A linked trip is a trip from the origin to the destination on the transit system. Even if a
passenger must make several transfers during a journey, the trip is counted as one linked
trip on the system.

USES

The fare paid is a contribution to the operational costs of the transport system involved,
either partial (as is frequently the case with publicly supported systems) or total. The
portion of operating costs covered by fares – the fare box ratio typically varies from 30%-
60% in North America and Europe, with some rail systems in Asia over 100%.

The rules regarding how and when fares are to be paid and for how long they remain valid
are many and varied. Where the fare can be generally be predicted in advance (such as fixed
fare systems) fare is usually collected in advance; this is the usual practice of rail and bus
systems, who usually require the payment of fares on or before boarding. In the case of
taxis and other vehicles for hire, (where the total fare will not be known until the trip is
completed) payment is normally made at the end of the ride. Some systems use a hybrid of
both, such as a rail system which requires prepayment of the minimum fare in advance, and
collecting amounts above the minimum (if the net cost of the trip exceeds the minimum
fare) at the end of the trip.

Some systems allow free transfers: that is to say that a single payment permits travel within
a particular geographical zone or time period. Such an arrangement is helpful for people
who need to transfer from one route to another in order to reach their destination.
Sometimes transfers are valid in one direction only, requiring a new fare to be paid for the
return trip.

Penalty fares are fares issued for passengers without valid tickets; standard fare is a term
with similar meaning. In the United Kingdom, certain Train Operating Companies, such as
South Western Railway and Southern, have Revenue Protection Inspectors who can issue
penalty fares to passengers who travel without a valid ticket. This is currently a minimum of
£20 or twice the single fare for the journey made. In Canada, the Toronto Transit
Commission charges $500 for people evading the $3 fare.
FARE STRUCTURE

Fare structure refers to the types of fares charged, the most common of which are:

 Flat fare (same fare irrespective of distance travelled on a particular route)

 Graduated fare (fare increases with distance travelled on a particular route)
 Zonal fare (fare increases with journey distance according to fare bands and is
usually independent of number of bus routes used, i.e., free transfers, and also
usually independent of mode of travel selected if bus and rail are both available)

Fare structure also includes whether or not concession fares are offered for particular
groups of passengers, typically, children, students, and the elderly. Whether or not passes of
various types (e.g., weekly, monthly, tourist) are offered in addition to single journey tickets
is also part of fare structure.

Fare level
Fare level refers to the average fare paid per passenger (or per passenger-kilometre) for the
whole system. Raising or lowering this average level obviously changes the total income of
the bus system.

Fares policy objectives

In order to assist transport professionals involved in determining either fare structure or
fare level, it’s important that political leaders set policy objectives so transport professionals
can measure the impact of fares.

The policy guidelines should first and foremost give clear guidance about the extent to
which fare revenue should cover operating costs. What level of cost recovery is desired —
40%, 60%, 100%?

Secondly the policy guidelines should state whether the user should broadly be paying for
the amount of service he is using. This means, for example, the further you travel and the
better the quality the more you pay, which, in turn, points towards a graduated or zonal
fare.

Alternatively, if bus service is seen as a social service that should be available to all at the
same price independent of the distance travelled, this, in turn, points towards a flat fare.
Normally the use of flat fares is designed to help poorer people living at some distance from
employment opportunities in the city centre.

Consistency is key
once policy principles are decided, it’s important for governments to apply them firmly. An
inconsistent approach can be disastrous. For example, general fare controls that don’t allow
fares to rise in line with operating costs means either subsidies must increase or bus
companies will go bankrupt.
ALTERNATIVE FARE STRUCTURES

Flat fares: Under a flat fare structure the same fare is paid no matter what distance is
travelled. This can be based on a single boarding or it can be based on duration (e.g., within
two hours of ticket issue or validation).

For cities covering a small area this can be a reasonable option but for cities covering a large
area it can pose difficulties. If the fare is set at a level that encourages short distance travel
within the city it almost certainly represents a substantial discount for longer trips. The
overall system operating at flat fares usually has a low cost-recovery ratio and requires
substantial operating subsidy. This structure subsidises all longer distance travel whether
passengers are in need of it or not and subsidizes both casual and regular travellers.

Flat fares can vary for either bus quality (e.g., air conditioned or not), or quality of service
(e.g., limited stop and express).

Graduated fares: Under a graduated fare structure, passengers pay an increasing amount
the further they travel. This can be done on the basis of the passenger’s journey (best) or on
the distance of the bus routes (not so good).

The benefit of this approach is a closer match between the amount of service provided and
the fare paid and if the fares are set below cost recovery, the benefits apply to all
passengers more or less equally. Like flat fares, graduated fares can be related to service
quality.

Zonal fares: Under a zonal fare structure the city is divided into zones and passengers are
charged according to the number of zones they travel. This is similar in principle to the
graduated structure but is independent of the route structure. While separate fares can be
charged for different modes, it is customary for zonal fares to be independent of the mode
chosen. This is usually a policy decision to enable competing bus routes to be withdrawn
after the introduction of a new rail line.

Concession fares: The most common types of concession fares are for children, students,
seniors and disabled. There must be agreement between the government and the operator
as to who pays for the difference between the concession fare and the regular fare.

If the operator is expected to absorb this discount then regular adult fares must be higher
than they would have been otherwise in order to generate enough additional revenue to
cover the shortfalls. If the government is willing to pay for particular groups some method
must be established to obtain estimates of the amount due.

Mechanisms and channels for financing social service provisions, such as student or elderly
concessions, must be defined. They can include contributions from budgets of the relevant
departments such as social services and education.
Monthly and other passes: In many cities monthly or weekly passes are sold to encourage
regular use of public transport. These are normally aimed at people making similar journeys
each day such as company employees and students. While a certain discount may be
offered by the operator on commercial grounds this is usually relatively small.

Where governments have an objective to provide travel to some or all citizens for some
maximum amount or some maximum percentage of income, these discounts can be more
substantial. In this latter case, it would be the obligation of the government to compensate
the operator.

DELHI METRO FARE BREAKUP

Maximum and minimum fares for dmrc lines –

1. From Monday to Saturday

Min = Rs 10/- & Max = Rs 60/-.
2. On Sunday and national holidays

Min = Rs 10/- & Max = Rs 50/-

FARE PAYMENT AND COLLECTION TECHNOLOGY ISSUES
Benefits and Costs Associated with Electronic Fare Payment Technologies
• The advent of electronic fare payment has facilitated the use of stored value as a prepaid
option. Stored value offers the convenience associated with any type of prepayment and
allows the rider to decide how much to prepay at a given time. This option can also "mask"
the complexity of a fare structure to the rider because he or she does not have to know the
exact fare for a particular trip.
• Stored value—and electronic fare payment in general—enables agencies to offer various
fare options and to modify the fare structure easily. For instance, electronic stored value
media permit differentiation of fares by payment option (i.e., time-based, trip-based, value-
based, or combinations thereof), time of day, mode, nature of minimum purchase price, and
discount or bonus offered. Because electronic payment can enable agencies to offer a range
of fare options and structures with a single fare medium, electronic fare payment also can
facilitate integration of multiple operators in a region.
The use of electronic fare payment can considerably reduce bus operators' fare collection
responsibilities, thereby minimizing potential operator and rider conflicts (i.e., regarding
pass or transfer validity). The reduction in the need for operators to handle and inspect
transfers or flash passes can result in reduced dwell time, thereby improving service
reliability.
• Electronic fare payment allows the collection of more accurate and comprehensive
ridership data (by fare category); this can permit better analysis and forecasting of fare
changes, as well as improved understanding of ridership patterns by route and time
period—and thus better service planning.
• The use of electronic media facilitates the generation of increased revenues through
reduced fare evasion and abuse and through better revenue control.

• Agencies can receive revenue from unused value on stored value cards—the agency
benefits from the "float" associated with prepayment in general, as well as the remaining
value on cards never actually used for purchasing trips.
• Electronic payment also offers opportunities related to expanding the existing capabilities
of the fare media themselves (e.g., through regional fare integration, multiple use cards,
and post payment and employer billing applications).
• The maintenance and repair costs for electronic payment—and distribution— equipment
can be expected to rise (at least initially), because of the need for more highly trained
personnel. Use of these technologies, however, may result in net fare collection cost savings
because of reductions in the numbers of overall fare collection staff (particularly ticket
agents, clerks, and revenue processing personnel) needed.
• The cost of purchasing and implementing electronic fare collection equipment can be
high, depending on the specific types of equipment involved. The unit cost of the fare media
can also be high (i.e., for smart cards).

FARE TECHNOLOGY AND MEDIA

Fare Technology and Media Fare technology and media represent the primary hardware and
software for collecting passenger fares onboard transit vehicles. Transit agencies
throughout the country use a variety of different fare technology and media (how the fare is
paid). The technology and media have evolved greatly over the years. Current fare
technology runs the range from non-registering fareboxes which are literally just containers
that house the fare revenue deposited by passengers all the way up to SmartCard
technologies that allow passengers to pay their fare with a quick pass of a credit card size
fare instrument. Technology is evolving in such a way that some agencies have been
experimenting with paying fares using SmartPhone applications. Some systems, primarily
rail and Bus Rapid Transit systems, have off-board fare collection technology with a proof of
payment system. Below is a description of different fare technology and media.
Non-registering fareboxes are the simplest fare technology. These fareboxes are little more
than containers where passengers are able to deposit fares. These fareboxes can only
accept cash fares or, if the system utilizes them, fare payment coupons. Flash passes,
coupons, and punch cards are used for prepaid fare media. These fareboxes do not have the
ability to track ridership payment characteristics. Many operators who use these fareboxes
will have a separate passenger counter device that the operator manual “clicks” for each
fare type. Very few systems use non-registering fareboxes nowadays.
Registering fareboxes allow for fares to be paid and data to be collected regarding fare
types. These fareboxes can collect the number of passengers boarding a bus by each fare
type for each trip operated. Registering fareboxes can be designed to accept different types
of fare media including flash or punch passes or even magnetically coded fare cards. With
magnetically coded fare cards, the fare type can be read automatically by the farebox. For
punch and flash passes, operators can manually enter information regarding fare type paid.
These are currently the most common types of fareboxes.

The newest fare technology used by transit agencies are known as a SmartCard system. The
SmartCard fare instrument is the size of a credit card and can be loaded with any kind of
pass or stored value passes. SmartCard readers are needed on fareboxes in order to process
fares. Similar to the magnetically coded fare media, many different fare types are available
and are automatically counted by the farebox itself. By installing SmartCard readers at each
door of a transit vehicle, multiple door boarding can be facilitated. Another advantage of
SmartCards is that they can be used by multiple systems. The Massachusetts Bay
Transportation Authority (MBTA) Charlie Card, which is also accepted by ten of the fifteen
Regional Transit Authorities2, is an example of a SmartCard. There is a high cost to transit
agencies when implementing SmartCards as they require new or modified fareboxes, and
the fare media itself is rather expensive.
TOPIC 9: Fare Collecting Methods
INTRODUCTION
Mass Rapid Transit Systems handle large number of passengers. Ticket issual and fare
collection play a vital role in the efficient and proper operation of the system. To achieve
this objective, ticketing system shall be simple, easy to use/operate, easy on accounting
facilities, capable of issuing single/multiple journey tickets, amenable for quick fare changes
and require overall lesser manpower.
Manual fare collection is the practice of collecting fares manually
(without the aid of an automated machine). "Fare collection" generally refers to the
collection of fares in the transport industry in return for a ticket or passes to travel
Manual fare collection systems have the following inherent disadvantages:
1. Large number of staff is required for issue and checking of tickets.
2. Change of fare structure is time consuming as has to be done at each station.
3. Manipulation possible by jamming of mechanical parts.
4. Staff and passenger interaction leading to more chances of confrontation.
5. 100% ticket checking at entry / exit impossible.

Automated fare collection system is the collection of components that automate the
ticketing system of a public transportation network - an automated version of manual fare
collection. An AFC system is usually the basis for integrated ticketing
Automatic fare collection systems have the following advantages
1. Less number of staff required.
2. Less possibility of leakage of revenue due to 100% ticket check by control gates.
3. Recycling of ticket fraudulently by staff avoided.
4. Efficient and easy to operate, faster evacuation both in normal and emergency.
5. System is amenable for quick fare changes.
6. Management information reports generation easy.
7. System has multioperator capabilities.

The proposed ticketing system shall be of Contactless smart token/ card type. The
equipments for the same shall be provided at each station
Counter/Booking office and at convenient locations and will be connected to a local area
network with a computer in the station Master's room.
Passenger Operated Machine
Space for provision of Passenger Operated Machines (Automatic Ticket Dispensing
Machines) for future, shall be provided at stations.
India Automated Fare Collection Systems market is projected to grow at a CAGR of over
18% during 2018-2024.
Rising need for faster payment process owing to increasing number of daily
travelers/commuters has buoyed the demand for offering rapid payment solutions across
the country. Additionally, with smart city development projects, the government is taking
several key measures for the growth of rapid transport
solution in India, especially in the Tier-I and Tier-II cities. With the swift development of
transport solutions, the automated fare collection systems market is registering higher
growth over the past few years. In terms of market applications, the metro railway transport
dominated the overall market revenues on account of need for faster and automatic
payment solutions across all metro railways in the country. Additionally, with increasing
adoption of public transportation primarily, metro railways and rapid bus transport systems
in Tier-I and II cities by daily commuters, the AFCS market is anticipated to generate
considerable growth prospects over the coming years.
In terms of regions, the Northern region accounted for the highest revenue share in India
AFCS market in 2017. Moreover, the region is likely to continue its dominance during the
forecast period as well, owing to upcoming/ongoing metro railway projects and parking
solutions, especially in Delhi/NCR region.
FARE POLICIES
Cash fares are accepted by almost all transit agencies. Most transit agencies accept only
exact fare and will not make change. A small number of agencies will make change for
passengers on some or all services. Some agencies have limitation with their fare collection
equipment that only allows the fare box to accept coins, while most operators are able to
accept both bills and coins.
Unlimited ride passes allow users to take as many rides as needed over a set period of time.
These passes are a pre-paid fare media and come in many increments. Most agencies have
either a 30-day, 31-day or “monthly” pass. For a shorter duration, agencies may have a
week pass or even a two-week pass. The shortest duration pass is a one-day pass and
agencies that sell a one-day typically do not have free or discounted transfers. Unlimited
ride passes provide a discount over cash fares, with the discount related to the number of
times the pass is used as it represents a single payment over a time period. The issue with
unlimited ride passes is that it typically requires a large upfront payment by customers to
take advantage of the discount, which may be difficult for lower income users.
Multi-ride passes or stored value cards allow for passengers to buy a set number of transit
trips ahead of time usually at a discount. These pass/stored value cards allow for the pre-
paid purchase of discounted fares. Similar to the unlimited ride passes; these fares require a
large upfront payment, although not as large as the unlimited ride passes, in order to take
advantage of discounts. Multi-ride passes/Stored value cards can come in a variety of
different types of media and formats including ticket books, tokens, punch cards, or as
stored values on a fare card or Smart Card.
Free Fares or Hidden Fee - Some agencies have instituted free fares, which are typically
prepaid in a hidden fee. Free fares primarily exist in places where the primary generator in
the area is a major university. In these areas, funding sources for transit services come from
the university. In other locations, college students are provided a free transit pass that is
funded by student service fees, parking revenues at the college, general fund revenue, or a
combination of these sources. An example of a system that has a free fare policy is Chapel
Hill Transit in North Carolina, which serves the University of North Carolina.
Transfer policies are a very important consideration and part of any fare policy and fare
media. Transit passengers have varied origin and destination locations so it is impossible to
serve all passengers without requiring passengers to transfer. Many systems are designed
around bringing passengers to a central location where they can connect to another bus to
reach their destination. Other systems have transfers occur at points where two or more
routes intersect. Regardless of transfer location, transfer policies have an impact on
ridership. The existing transfer policies include allowing transfers to occur for free, transfers
to occur at a low cost, or requiring passengers to pay full fare when transferring. Some
systems have different policies based on fare media used, for example a free transfer if
using a SmartCard while cash passengers have to pay full fare when transferring .
Standard Practices
Fare policies typically respond to local needs. In some locales the fare policy and changes to
fare policies are well codified. In other locations, fare policies change only in response to an
identified issue; otherwise fare policies may not change at all for a long time. Fare policies
need to be responsive to local needs. The fare policy has to be cognizant of the need to
provide an adequate local share of operating costs. That being said the fare policy has to
also strike a balance between being equitable to all users, encourage pre-paid fares,
encourage ridership, and the need to raise local revenue.
Federal rules and guidelines need to be taken into account in fare policy discussions.
Environmental justice concerns also need to be taken into account as part of fare policy and
fare policy changes as it relates to Title VI of the Civil Rights Act of 1964. Legal proceedings
have forced modifications to fare policies and fare policy changes due to environmental
justice concerns7. Environmental justice concerns are addressed by ensuring that fare policy
changes are equitable for all services an agency operates. Fare policies also need to be
consistent with rules and guidelines with the American’s with Disabilities Act.
As stated previously, very few agencies have a policy regarding fare changes. Primarily,
agencies adjust fare levels based on a specific need, usually the need for additional directly
generated revenue. This could be in response to cuts in funding from other sources, changes
in cost structure, or overall cost increases. On a philosophical level many agencies prefer to
increase fares along with improvements in service so that passengers are receiving “better
service” as part of higher fares.
The key elements of a fare policy include a base cash fare, multi-ride fare media, unlimited
ride passes, and a transfer policy. Ten out of fifteen RTA’s in Massachusetts use the Charlie
Card SmartCard for fare payment which does have the ability to store unlimited ride passes.
Beyond this fare policy, transit agencies have been partnering with colleges and universities
to fund UPass programs which provide free trips for students and guaranteed revenues for
the transit agency.
TOPIC 10: BASIC FACTORS OF BUS SCHEDULING AND PROBLEMS RELATED TO
BUS SCHEDULING

INTRODUCTION
Scheduling refers to the assembly of all the documents showing trip timings at certain
points along a particular route. The schedule may also include additional information such
as route descriptions, deadhead time, interline information, run numbers and block
numbers. One of the main roles of a transport planner is to create a highly efficient
schedule. This involves combining orders with routes and shifts in such a way that total
costs are minimized, and all business rules and service constraints satisfied. In today's world,
this is a process far too complex to be done manually.
Public as well as Private transport bus services are generally based on regular operation of
transit buses along a route calling at agreed bus stops according to a published transport
timetable.
Many public bus services are run to a specific timetable giving specific times of departure
and arrival at waypoints along the route. These are often difficult to maintain in the event of
traffic congestion, breakdowns, on/off bus incidents, road blockages or bad weather.
Predictable effects such as morning and evening rush hour traffic are often accounted for in
timetables using past experience of the effects, although this then prevents the opportunity
for drafting a ‘clock face’ timetable where the time of a bus is predictable at any time
through the day.

Importance of Bus Scheduling

Here are the following points:
a) To customers a schedule provodes the essential information to plan a trip, defines the
arrival and departure times and the time that the trip will take.
b) Makes sufficient capacity of service available so that the customer’s trip will be
comfortable and ensures the customers reach the desired location at the promised time.
c) To operators, scheduling defines the workday. Operators are the front line in terms of
dealing with the customers and the interaction can be affected by running and layover
times.
d) Operators also tend to favour straight runs and full time runs than the split shifts. Good
scheduling can thus reduce the stress inherent in this job thus improving morale and
reducing absenteeism.
e) To transit agencies, scheduling puts reliable service on the stress where it will be most
utilized. In addition, scheduling provides data and information to support the sections such
as Marketing, Planning, Operations, Administration, and many downstream systems like
voice annunciators, trip planners etc.
f) To chief officers, scheduling has major impacts on the cost of operations and the quality.
The extent of these impacts is sometimes not fully understood within the agency.
Scheduling is the brain of transit organism in its day to day functioning. By its nature
scheduling has the clearest understanding of how and where the cost efficiencies will be
achieved.
Predictable short-term increases in passenger numbers may be dealt with by providing
“duplicate” buses, where two or more buses operate the same slot in the timetable.
Unpredictable problems resulting in delays and gaps in the timetabled service may be dealt
with by ‘turning’ a bus early before it reaches it terminus, so that it can fill a gap in the
opposite direction, meaning any passengers on the turned bus need to disembark and
continue on a following bus. Also, depending on the location of the bus depot, replacement
buses may be dispatched from the depot to fill in other gaps, starting the timetable part way
along the route.
What makes a good schedule
Reliability, service frequency that matches the demand or agency policies, operating speeds
as high as possible consistent with safety and minimisation of operating and capital costs
are all important and at times contradictory goals.
There are both science and art required in achieving these goals, beyond the requirement
that the scheduler be capable of and comfortable with dealing with increased reams of data.
A good schedule provides the right level of service at the minimum cost. A good schedule is
the key to an efficient and sustainable transit operations.

Factors Influencing Bus System Efficiency :

1) Regulatory framework - Regulation may also be considered necessary to prevent
operators from abusing a monopoly position, or, in a competitive situation, to control
undesirable or potentially dangerous aspects of competition between operators.
The main goals of public transport regulation are to:
 ensure that services are operated in line with government policy
 satisfy demand for public transport as much as possible
 maintain standards of quality and safety
 control fares at affordable levels (sometimes)

2) Fare control- Public transport fares are regulated in most developing countries, and
enforcement is often more stringent than for any other regulation. The regulations may
specify actual fares to be charged, a maximum permitted charge, or a charge for a basic
service that operators are permitted to exceed at their own discretion for premium services.
Different fare levels may be authorized to reflect different service standards.

3) Enforcing rules and regulations- A regulatory system must be enforceable. This requires
regulations that are appropriate under specific circumstances. Effective administrative and
enforcement procedures are also key.
Poor enforcement of regulations plagues developing countries. Public transport is no
exception, where it can lead to:
 unreliable bus service
 poor maintenance standards (which may affect safety and pollution)
 poor driving standards (which affect safety and traffic congestion) maltreatment of
passengers
 violence between operators
 antisocial or dangerous on-the-road behavior
Poor enforcement is usually due to a lack of resources, unsatisfactory systems, or general
inefficiency or inability on the part of the staff.
4) Route planning- A public transport system must accommodate a very large number of
individual trips. It’s not possible to provide direct public transport routes to meet all
requirements But it’s possible to go a long way towards achieving this by providing a
network of routes, so that passengers can make complex journeys by using a combination of
routes. Many transport systems consist of routes planned in isolation rather than as parts of
coordinated networks. This is usually unsatisfactory for meeting the requirements of a
significant proportion of travelers. Poor route planning may result in poor route coverage,
an excessive requirement for interchange between routes, and irregular frequencies.

5) Operating structures and company size- The structure of the transport system is an
important factor in determining the nature and cost of the service provided and the types of
vehicles operated.
If small operators predominate, small buses are likely to predominate because small
vehicles are easier for small businesses to buy and operate. There is also less likely to be a
coordinated network of routes than might be expected if the system is dominated by large
operators.
Each operating structure has its own characteristics, and is appropriate in different
circumstances. There is no ideal form that is universally applicable.

6) Vehicle size and type –

Vehicle size
Large buses are appropriate in certain circumstances, and small vehicles in others. It’s
sometimes difficult to determine whether several small vehicles or one large one would
meet the requirements of passengers and operators more efficiently in any given situation.
In broad terms, the appropriate vehicle size is influenced by:
 The volume of traffic (the number of people traveling between the same two points
at the same time).
 The characteristics of the road system.
 The type of services that passengers are prepared to pay for.
Passenger flows achieved with different vehicle sizes vary considerably. A service operated
exclusively by small buses with about 10 seats each can carry up to a maximum of about
3,000 passengers per hour in a single lane in one direction.
Size and operating speed
The size of a vehicle can affect its operating speed in various ways. A small vehicle usually
has better acceleration and maneuverability in traffic than a larger vehicle. Smaller size also
means a smaller number of passengers boarding and alighting at each stop, so dwell times
at stops will also be less.
Speed of operation has an effect on system capacity. A vehicle that can achieve a higher
average speed will be able to provide more passenger-kilometers than a slower vehicle with
the same capacity, although vehicle performance is obviously affected by prevailing traffic
speeds.

9) Fleet size -The fleet (all the vehicles owned or licensed in the bus system) should be
tracked regularly by the regulatory authority. More importantly, fleet capacity should also
be tracked. The effective capacity of the fleet is influenced by the availability and utilization
of buses.
Shortage of transport capacity may be due to inadequate fleet size. Often, however, the
number of available vehicles would be adequate if they were more effectively utilized.
Inefficient operating practices, such as full-vehicle despatching, may result in inadequate
capacity even if there are surplus vehicles.
Surplus vehicles may cause severe traffic congestion in terminals and in the surrounding
streets if there is insufficient parking space in the terminals.

10) Vehicle maintenance- Maintenance standards play a significant role in vehicle operating
costs, levels of safety and reliability, and pollution.
A useful indicator of maintenance standards is the average number of kilometres per
breakdown.
Vehicles maintained according to a properly designed preventive maintenance program are
less expensive overall than those maintained on a reactive basis (i.e., only when a defect has
developed).
Preventive maintenance is designed to prevent premature failure. This means that, as far as
possible, parts are replaced shortly before they fail, fluid levels are checked, adjustments
are made when necessary, and loose fastenings tightened.
The intervals between the various interventions are based on analysis of the performance of
the different components, usually by vehicle manufacturers, but also often by technical
departments of larger bus operators.
Cost savings
Significant cost savings are possible. For example, regular checking of wheel alignment, tire
pressure and condition can reduce wear and increase tire life significantly. Regular checking
of engine oil levels and replacement of oil and air filter elements, costing only a few dollars,
can prevent the failure of an engine that costs thousands of dollars to replace.
Service improvements
In addition to reducing costs, preventive maintenance reduces the number of vehicle
breakdowns and improves service reliability. It also improves safety by reducing the
incidence of failure of safety-critical components such as brakes, tires and steering
mechanisms.
Environmental protection
Good engine maintenance, in particular of diesel fuel injection equipment, will minimize
exhaust emissions and reduce pollution.
Excessive Operating Costs
Excessive operating costs will lead to excessive fares, low profitability, excessive subsidy
requirement or a combination of all three.
Excessive costs may be incurred through inefficient operating practices, excessive numbers
of staff, and poor vehicle maintenance. All of these are within the control of the bus
operator.
However, there may be excessive costs that are caused by factors beyond the bus
operator’s control. Often these factors are controlled by government.