Industrial Management

Segment-4

 Define investment and Budget.

Investment: Money committed on property acquired for future

income.

Budget: Budget is an amount of money available for spending

that based on a plan for how it will be spend.

 What Is a Consumer Market?

Each time you buy a product or service, you are participating in

the consumer market.
A consumer market is the system that allows us to purchase
products, goods, and services. These items can be used for
personal use or shared with others.
In a consumer market, you make your own decisions about how
you will spend money and use the products you purchase. The
more people who go out and actively purchase products, the
more active is the consumer market.

 Identify different steps of control and what is the relation

between them.
Main steps in control process in management are-----

i. Establishing Standards
ii. Measuring Actual Performance
iii. Comparing the Actual Performance with Expected
Performance
iv. Correcting Deviations

 Describe the Steps in Control Process in Management.

Control as a management function involves the following steps:

1. Establishing Standards:
The first step in the process of controlling is setting performance
standards.
These standards are the basis for measuring the actual
performance.
These standards can be expressed both in quantitative and
qualitative terms.

 Examples of Quantitative Standards:

(a) Revenue to be earned.
(b) Units to be produced and sold.
(c) Time to be spent in performing a task.

 Examples of Qualitative Standards:

(a) Improving level of motivation among employees.
(b) Improving labor relations.
(c) Improving quality of products.

2. Measurement of Actual Performance:

Once the standards have been determined, the next step is to

measure the actual performance.
Measurement involves comparison between what is
accomplished and what was intended to be accomplished.
The various techniques for measuring are sample checking,
performance reports, personal observation etc.

3. Comparing Actual Performance with Standards:

This step involves comparing the actual performance with

standards laid down in order to find the deviations.
For example, performance of a salesman in terms of unit sold in
a week can be easily measured against the standard output for
the week.
4. Analyzing/Correcting Deviations:

Some deviations are possible in all the activities.

But the deviation in the important areas of business needs to be
corrected more urgently as compared to deviation in
insignificant areas. Management should use critical point control
and management by exception in such areas.

i. Critical Point Control

ii. Management by Exception

 Purpose of Control with example

Purpose of control is----

 Adapting to Environmental Change

 Limiting the Collection of Error
 Coping with Organizational Complexity
 Minimizing Costs

 Discuss the Level of Control

 Marketing people are involved in marketing 10
types of entities. Show the example of all 10
entities.

Marketing people are involved in marketing 10 types of entities:

goods, services, experiences, events, persons, places, properties,
organizations, information, and ideas.

Goods: physical goods like canned, bagged and frozen food

products, cars, refrigerators, televisions, machines, etc.

Services: include the work of airlines, hotels, car rental, barbers

and beautician, lawyers, doctors.

Events: time-based events, such as trade shows, sporting like

the Olympics and the World Cup.

Experiences: a marketer can create, stage and market

experiences such as a week at a baseball camp, a Disney Land
visit, etc.

Persons: artists, musicians, politicians, lawyers, celebrities like

Oprah, David Beckham, etc.

Places: cities, states, countries competing to attract tourists, etc.

Properties: real property or financial property.

Organizations: organizations aims to build a strong, favorable

image for their target public.

Information: books, schools, universities.

Ideas: all market offering includes a basic idea.

 Define PLC.
 Mention the different stages in Product Life
Cycle(PLC) with example.

 PLC: (PLC) is the cycle through which every product goes

through from introduction to withdrawal or eventual demise.

 Stage of PLC:

Introduction: In this period the product get introduction in

market.
Profits are nonexistent because of the heavy expenses of product
introduction.

Growth: A period of rapid sales growth and market acceptance.

And substantial profit improvement.
Maturity: A slowdown in sales growth because the product has
achieved acceptance by most potential buyers. Profits stabilize
or decline because of increased competition.

Decline: Sales show a downward drift and profits erode.

 Mention the different stages in family Life Cycle

with example.

- Young, Single.
- Young, Married, No Children.
- Young, Married, Youngest Children Under 6.
- Married, Youngest Children 6 or Over.
- Older, Married, With Children
- Older, Married, No Children Under 18
- Older, Single
- Other

Family life cycle (FLC):

The emotional and intellectual stages you pass through from

childhood to your retirement years as a member of a family are
called the family life cycle.
Individual stage: person in independent living, responsible for
own needs, beliefs and behaviors

Beginning stage: Couple joins together to establish a new

family through marriage or living together. Need to be blend
ideas behaviors and expectations

Child bearing stage: New members are added to the family.

Parenting stages: Families increase need for space and time

consideration with responsibilities of multi generation care.

Launching stage: The family system is expanded though

marriage of children.

Aging stage: Shift in focus for career usable and recreational

needs. May have need for housing change and assistance due to
health consideration.

 Describe different major consumer promotion

tools.
 What do you mean by sales promotion? Describe
consumer promotion tools.

 Sales Promotion: Sale promotion is the process of

persuading/convincing a potential customer to buy the
product.

 Description

Samples: Samples are one of the most important tools of sales

promotion.In this case, small units of free samples are delivered
door to door, sent through direct mail, attached to another
product, or given along with the purchase of some other product.
Free samples are normally provided during the introductory
stage of the product.

Coupons: This involves offering price reduction or saving to

customers on the purchase of a specific product.
The coupons may be mailed or enclosed along with other
products, or inserted in a magazine or newspaper advertisement.

Exchange Product: In this case, the customer exchanges the old

product for a new one. The old product’s exchange value is
deducted from the price of the new product. This sales
promotion tool is used by several companies for consumer
durable.

Demonstration: Demonstration is required when products are

complex and of a technical nature.
By demenostrate we can educate the customer about product.
Which makes easy to select the product for customer.

‘Price off’ offer: Goods are sold at reduced prices during slump
season. Reduction in prices stimulates sale of goods.

Premium offers: These can be extra quantities of the same

product at the regular price. Premium offers are used by several
firms selling FMCG goods such as detergents, soaps and food
items.

Personality promotions: This type of promotion is used to

attract the greater number of customers in a store and to promote
sale of a particular item. For instance, a famous sports
personality may be hired to provide autographs to customers
visiting a sports shop.

Free Trials: Inviting prospective purchasers to try the product

without cost in the hope that they will buy.

 Describe the Profiles of Major Media type.

 PROFILES OF MAJOR MEDIA TYPES
Medium Advantages Limitations

Short life, poor reproduction

Flexibility, timeliness, good local market
Newspapers quality, small pass-along
coverage etc.
audience

Good mass market coverage, combines High absolute costs, high

Television
sight, sound, and motion. clutter.

High audience selectivity, flexibility, Relatively high cost per

Direct mail
allows penalization. exposure, “junk mail” image

Good local acceptance, high geographic Audio only, low attention,

Radio
and demographic selectivity, low cost fragmented audiences

High selectivity, low cost, immediacy,
Online
interactive capabilities
Small, demographically
skewed audience, relatively
low impact, audience controls
exposure

 Define Marketing Mix and 4Ps

The marketing mix is a crucial tool to help understand what the

product or service can offer and how to plan for a successful
product offering.

The marketing mix is most commonly executed through 4Ps of

marketing.

4Ps is:
- Price
- Product
- Promotion
- Place
 How Does a Budget Help a Manager With Financial
Control?

For the hands-on manager, maintaining an overview on the big

picture is difficult.
A budget provides a road map for performance that offers
detailed information about expected outcome that a proactive
manager can use to guide decisions toward desired goals.

 Planning

As a manager looks forward over a period of business and

prepares, he may consider how much material or staff is needed.
When a budget shows expected sales over the same period, the
manager can take budgeted costs of sales and work backwards
to determine raw materials needs or labor hours required.
Effective managers will consider adjustments based on current
market conditions that may vary from the time the budget was
devised. For example, if sales have been performing 3 percent
over budget for several months, the manager may add this to his
calculations.

 Prioritizing

Comparing year-to-date performance to the budget may help a

manager decide how to approach a problem or challenge. For
example, if labor costs in a particular area are higher than
budget, but new equipment purchases are under budget, a
manager might requisition a new machine that helps reduce
labor moving forward. In this case, the budget serves as a
justification for a proposal. As an account item climbs over
budget, it becomes a manager's priority to control.

 Continuous Improvement

An effective manager is not just looking to meet budget, but also

looks for ways to improve. With weekly or monthly
performance numbers compared to budget, a manager is a
first-level systems analyst for operations. Working at floor level,
for example, a manager could work with employees for ways to
increase throughput or reduce waste. The budget often provides
clues as to where effort is most effectively focused to produce
improved financial performance.

 Forecasting

One year's budget often serves as a basis for the following year,
and when managers are involved in the budgeting process, each
of the previous steps can be applied looking forward. Managers
may be in a unique position to observe the effects of improved
staff training, for example, as a contributor to improved
performance. Forecasting becomes a chance for an effective
manager to reach beyond the bounds of his department to
suggest changes that may create better conditions for financial
success the following year.
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 The Basic Steps in the Management Planning

Process

Establish Goals
The first step of the management planning process is to identify
specific company goals. This portion of the planning process
should include a detailed overview of each goal, including the
reason for its selection and the anticipated outcomes of
goal-related projects. Where possible, objectives should be
described in quantitative or qualitative terms. An example of a
goal is to raise profits by 25 percent over a 12-month period.
Identify Resources
Each goal should have financial and human resources
projections associated with its completion. For example, a
management plan may identify how many sales people it will
require and how much it will cost to meet the goal of increasing
sales by 25 percent.
Establish Goal-Related Tasks
Each goal should have tasks or projects associated with its
achievement. For example, if a goal is to raise profits by 25
percent, a manager will need to outline the tasks required to
meet that objective. Examples of tasks might include increasing
the sales staff or developing advanced sales training techniques.
Prioritize Goals and Tasks
Prioritizing goals and tasks is about ordering objectives in terms
of their importance. The tasks deemed most important will
theoretically be approached and completed first.
For example, if a goal is to increase sales by 25 percent and an
associated task is to increase sales staff, the company will need
to complete the steps toward achieving that objective in
chronological order.
Create Assignments and Timelines
As the company prioritizes projects, it must establish timelines
for completing associated tasks and assign individuals to
complete them.
For example, the sales manager in this scenario may be given
monthly earning quotas to stay on track for the goal of
increasing sales by 25 percent.
Establish Evaluation Methods
A management planning process should include a strategy for
evaluating the progress toward goal completion throughout an
established time period. One way to do this is through
requesting a monthly progress report from department heads.
Identify Alternative Courses of Action
Even the best-laid plans can sometimes be thrown off track by
unanticipated events. A management plan should include a
contingency plan if certain aspects of the master plan prove to
be unattainable. Alternative courses of action can be
incorporated into each segment of the planning process, or for
the plan in its entirety.

Group-B

 What is Contract?Describe the essential element of

Contract.

 Contract: A contract is an agreement between two or more

parties or persons that creates an obligation to do or do not a
particular thing.

 Essential Element

Offer and Acceptance: In order to create a valid contract, there

must be a 'lawful offer' by one party and 'lawful acceptance' of
the same by the other party.

Intention to Create Legal Relationship: In case, there is no

such intention on the part of parties, there is no contract.
Agreements of social or domestic nature do not consider legal
relations.

Lawful Consideration: Consideration has been defined in

various ways.
According to Blackstone,"Consideration is reward given by the
party contracting to another."
In other words of Pollock, "Consideration is the price for which
the promise of the another is brought."
consideration is known as something in return.

Capacity of parties: The parties to an agreement must be

competent to contract. If either of the parties does not have the
capacity to contract, the contract is not valid.
According the following persons are incompetent to contract----
(a) Miners.
(b) Persons of unsound/sick mind.
(c) Persons disqualified by law.

Free Consent: 'Consent' means the parties must have agreed

upon the same thing in the same sense.

Lawful Object: The object of an agreement must be valid.

Object has nothing to do with consideration.

The Object is said to be unlawful-

- If it is fraudulent.
- If it is disqualified by law.
- If it involves an injury to the person or property of any other.

Possibility of Performance: If the act is impossible in itself,

physically or legally, if cannot be enforced at law.
For example, Mr. A agrees with B to discover treasure by magic.
Such Agreements is not enforceable.

 What are the rules regarding Delivery.

- Delivery ways.
- Payment and delivery.
- Time of delivery.
- Place of delivery.
- Delivery expense.
- Delivery to carries.
- Delivery to installments.
- Goods in the custody of third parties.
- Defective delivery.
1. Delivery Ways :-
When goods are sold then delivery can be made by symbolic,
actual or constructive way. It depends upon the parties that
which way they adopt.
2. Time of Delivery :-
The seller should deliver the goods on a specified date. If the
time is not fixed then delivery should be with in a reasonable
time.

3. Payment And Delivery :-

Both the actions should be at the same time. The buyer should
make the payment and seller should deliver the goods in
exchange of payment at the same time, just like the cash sale on
the customer of a super stores.

4. Place of Delivery :-
A delivery of goods should be at a specified place mentioned in
the contract.
Example :- "X" agrees with "Y" to supply furniture on 38-Tipu
Road Ahmadabad. "X" is bound to supply the goods on the
same place, where parties made contract.

5. Delivery Expenses :-
The expenses of putting the goods into deliverable state must be
born by the seller, otherwise as the parties agree.
Example :- "X" sells the T.V to "Y". The expenses of packing
the T.V will be born by the seller.

6. Delivery to Carrier :-
When seller is required to send the goods to the buyer, the
delivery to carrier is considered delivery to the buyer.
Example :- "X" sells computer to "Y". "X" handed over the
computer to the carrier to be delivered to "Y". it means delivery
has been made.

7. Delivery in Installments :-
The buyer is not bound to receive the goods in installments but
if the buyer and seller are agree then the delivery of goods may
be made in installments.
8. Good In the Custody of Third Party :-
If the sellers goods are in the custody of the third party, the
delivery is not possible until the third party agrees to handed
over the sold goods to the buyer on behalf of the seller.
Example :- "M" has his cycle in the store of "Y". "M" sells the
cycle to "B" and gives him letter to take from "Y". "Y" agrees to
deliver the cycle to "B".

9. Defective Delivery :-
A buyer can reject or accept the defective and wrong delivery.
In case of rejection buyer is not bound to return it to the seller.
Example :- Mr. Imik buys 1000 books of Economics from Khan
publishers. Publishers sends 500 books. Mr. Imik may reject the
whole or accept 500 and ask for the rest.

 Define Responsibilities of Operation Manager and

Major Process types.

 Operation system: It is a system which discussed about all

inputs, outputs, conversations and feedback of operation
management.

 Responsibilities of Operation Manager

Planning: Capacity,Location,Product and Service, make or

buy,scheduling etc.

Organizing: Centralization,Subcontracting

Staffing: Hiring/laying off,Use of overtime.

Directing: Distributing works,job assignment.

Controlling: Production control, labour control,cost

control,Quality control.
 Major Process Types:
i. Job Process
ii. Batch Process
iii. Line Process
iv. Continuous Process

5W2H Method: 5W2H is a problem definition technique

which works by asking 7 questions about a defect or any other
problem:

What?
- What to do?
- Why do?
- What should be done?

Who?
- Who do?
- For whom should be done?

Where?
- Where is it?
- Where should it be done?
- Where are you sending?
- Where you should send?

When?
- When you make?
- When should it be done?
- It is done in time?
- What is the best moment?

Why?
- Why do?
- Why this way?

How?
- How do you do?
- How should it be done?
- The method is practical?
- Which method should have been used?

How much?
- How much does that do?
- Why does it cost this?
- It's the least that could cost?
- How much should it cost?

 What is Operation Management?

 Describe the Five p’s of Operation Management.

Operation management: Operation management is the

processes of converting inputs into desired output that create
goods and provide services.

The five p’s of operation management:

 The Product:
Product is the link between production and marketing.It is
 not enough that a customer requires product but the
organization must be capable of producing the product.

 The Plant:
The plant accounts for major investment.
The plant should match the needs of the product, market, the
worker and the organization.

The plant is concerned with:

1. Design and layout of building and offices.

2. Reliability, perfect, maintenance of equipment’s.
3. Safety of operations.

 The Process:
There are always number of alternative methods of creating a
product. But it is required to select the one best method,
which attains the objectives.

The Process concerned with:

1. Available capacity
2. Manpower skills availability.
3. Type of production.
4. Layout of plant.
5. Safety.
6. Maintenance required.
7. Manufacturing costs.

 The Programs:
The programs here refers to the timetable of production.

The Programs concerned with:

1. Purchasing
2. Transforming
3. Maintenance
4. Cash
5. Storage and transport

 The People:
Production depends upon people. The people vary in their
attitudes, skill and expectations from the work. So, to make
best use of available human resource, it is required to have a
good match between people and jobs which may lead to job
satisfaction.

The production manager should be involved in issues like:

1. Wages/salary administration
2. Conditions of work
3. Motivation
4. Training of employees.
5. Ensure safety.

 Difference Between Product vs. Services:

 What is ISO 9000? Briefly describe the documents of ISO
9000?
 Explain PDCA Cycle

PDCA: (Plan-Do-Check-Act, sometimes seen as

Plan-Do-Check-Adjust) is a repetitive four-stage model for
continuous improvement (CI) in business process management.

The PDCA model is also known as the Deming cycle/wheel,

Shewhart cycle, control cycle, or plan–do–study–act (PDSA).
The four phases in the Plan-Do-Check-Act Cycle involve--

 Plan: Identifying and analyzing the problem.

 Do: Do whatever is planned.

 Check: Checking what is done.

 Act: Implementing the improved solution fully.