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All major social sciences like economics, psychology, sociology and anthropology have influenced buyer behavior studies. It is essential to have an idea of the nature of this influence.

Influence of Economics
Economists describe man as a rational buyer and view the market as a collection of homogeneous buyers. Under a given set of conditions, all buyers behave in a similar fashion and every buying decision is a logical process with the ultimate intention of obtaining optimum value for the money spent. Price is regarded as the strongest motivation for the economic man. The economic mans behavior, in short, is rational. Though the model of economic man may help us understand certain aspects of buyer behavior, it certainly cannot answer all the puzzles of buyer behavior. The main problem with the concept of economic man is the assumption that buyers are absolutely rational in their purchases and that markets are homogeneous. Markets are actually a collection of heterogeneous buyers, differing from each other in several characteristics. The marketing process is intended to match these heterogeneous segments of demand with heterogeneous segments of supply.

Influence of Psychology
The next major influence on buyer behavior came from psychology. According to psychologists, any human activity is directed towards meeting certain needs. These needs have been categorized in different ways by different psychologists. Physiological needs are the basic needs: they include the need to satisfy hunger, thirst, sleep, etc. For people who are well off, physiological needs are met as a matter of routine, whereas for the poor, a major part of their time is spent in striving to meet these needs. Safety needs include needs relating to physical safety and economic and social security. Social needs come next and they include the need for love and the need to belong. Esteem needs include the need for self-esteem, the need for recognition by society and the need to be held in esteem by others. Self-actualization needs include the need for self-development and the need to attain complete fruition of ones capabilities and endowments. The actions of individuals are guided by their need structure and need level.

Influence of Sociology and Anthropology

Sociology and anthropology lent further dimensions to the subject of buyer behavior. According to scholars in these fields, group pressure is the motive force behind buying. Sociologists and anthropologists have tried to establish a logical connection between buyer behavior and the social environment of the buyer. As a result, several new concepts like social stratification, reference groups, role-orientation, opinion leadership, etc., have come to be used for giving causal explanations of buyers behavior.

Q)Influence of social and economic classes on consumer behavior

Consumer behavior is influenced by environment in which one lives. A number of factors such as culture, social class, personal influences, family, religion and his situation affect the decision process. Amongst them social class has great impact on consumer behaviour.

Social class can be described as divisions within society composed of individuals sharing similar values, interest and behaviour. Two-category social class scheme divides the society in two classes based on profession or level of income i.e. Blue collar (workers) and white collar (office jobs) understand the buying behaviour of consumers, occupation of people is to be studied as people of same profession are expected to behave in a similar manner. All chartered accountants, all lawyers, all architects behave similarly. However, they may not be having same outlook. For example, the income of a lawyer varies between Rs.5000 per month to Rs.30 lakh per month. A doctor may earn Rs.100 per day to Rs.10000 per day. These income differences make big differences in their behaviour as a consumer.

Factors Affecting Consumer Behavior

Consumer behavior refers to the selection, purchase and consumption of goods and services for the satisfaction of their wants. There are different processes involved in the consumer behavior. Initially the consumer tries to find what commodities he would like to consume, then he selects only those commodities that promise greater utility. After selecting the commodities, the consumer makes an estimate of the available money which he can spend. Lastly, the consumer analyzes the prevailing prices of commodities and takes the decision about the commodities he should consume. Meanwhile, there are various other factors influencing the purchases of consumer such as social, cultural, personal and psychological. The explanation of these factors is given below.

1. Cultural Factors
Consumer behavior is deeply influenced by cultural factors such as: buyer culture, subculture, and social class.

Basically, culture is the part of every society and is the important cause of person wants and behavior. The influence of culture on buying behavior varies from country to country therefore marketers have to be very careful in analyzing the culture of different groups, regions or even countries.

Each culture contains different subcultures such as religions, nationalities, geographic regions, racial groups etc. Marketers can use these groups by segmenting the market into various small portions. For example marketers can design products according to the needs of a particular geographic group.

Social Class
Every society possesses some form of social class which is important to the marketers because the buying behavior of people in a given social class is similar. In this way marketing activities could be tailored according to different social classes. Here we should note that social class is not only determined by income but there are various other factors as well such as: wealth, education, occupation etc.

2. Social Factors
Social factors also impact the buying behavior of consumers. The important social factors are: reference groups, family, role and status.

Reference Groups
Reference groups have potential in forming a person attitude or behavior. The impact of reference groups varies across products and brands. For example if the product is visible such as dress, shoes, car etc then the influence of reference groups will be high. Reference groups also include opinion leader (a person who influences other because of his special skill, knowledge or other characteristics).

Buyer behavior is strongly influenced by the member of a family. Therefore marketers are trying to find the roles and influence of the husband, wife and children. If the buying decision of a particular product is influenced by wife then the marketers will try to target the women in their advertisement. Here we should note that buying roles change with change in consumer lifestyles.

Roles and Status

Each person possesses different roles and status in the society depending upon the groups, clubs, family, organization etc. to which he belongs. For example a woman is working in an organization as finance manager. Now she is playing two roles, one of finance manager and other of mother. Therefore her buying decisions will be influenced by her role and status.

3. Personal Factors
Personal factors can also affect the consumer behavior. Some of the important personal factors that influence the buying behavior are: lifestyle, economic situation, occupation, age, personality and self concept.

Age and life-cycle have potential impact on the consumer buying behavior. It is obvious that the consumers change the purchase of goods and services with the passage of time. Family life-cycle consists of different stages such young singles, married couples, unmarried couples etc which help marketers to develop appropriate products for each stage.

The occupation of a person has significant impact on his buying behavior. For example a marketing manager of an organization will try to purchase business suits, whereas a low level worker in the same organization will purchase rugged work clothes.

Economic Situation
Consumer economic situation has great influence on his buying behavior. If the income and savings of a customer is high then he will purchase more expensive products. On the other hand, a person with low income and savings will purchase inexpensive products.


Lifestyle of customers is another import factor affecting the consumer buying behavior. Lifestyle refers to the way a person lives in a society and is expressed by the things in his/her surroundings. It is determined by customer interests, opinions, activities etc and shapes his whole pattern of acting and interacting in the world.

Personality changes from person to person, time to time and place to place. Therefore it can greatly influence the buying behavior of customers. Actually, Personality is not what one wears; rather it is the totality of behavior of a man in different circumstances. It has different characteristics such as: dominance, aggressiveness, self-confidence etc which can be useful to determine the consumer behavior for particular product or service.

4. Psychological Factors
There are four important psychological factors affecting the consumer buying behavior. These are: perception, motivation, learning, beliefs and attitudes.

The level of motivation also affects the buying behavior of customers. Every person has different needs such as physiological needs, biological needs, social needs etc. The nature of the needs is that, some of them are most pressing while others are least pressing. Therefore a need becomes a motive when it is more pressing to direct the person to seek satisfaction.

Selecting, organizing and interpreting information in a way to produce a meaningful experience of the world is called perception. There are three different perceptual processes which are selective attention, selective distortion and selective retention. In case of selective attention, marketers try to attract the customer attention. Whereas, in case of selective distortion, customers try to interpret the information in a way that will support what the customers already believe. Similarly, in case of selective retention, marketers try to retain information that supports their beliefs.

Beliefs and Attitudes

Customer possesses specific belief and attitude towards various products. Since such beliefs and attitudes make up brand image and affect consumer buying behavior therefore marketers are interested in them. Marketers can change the beliefs and attitudes of customers by launching special campaigns in this regard.

Q) Decision Making Process

des d To arrive at a solution that ends uncertainty or dispute. From Latin decidere which means to cut off. Decision-making is one of the defining characteristics of leadership. Its core to the job description. Making decisions is what managers and leaders are paid to do. Yet, there isnt a day that goes by that you dont read something in the news or the business press that makes you wonder, What were they thinking? or Who actually made that decision? Thats probably always been the case, but it seems exponentially more so in the opening decade of the new millennium where everything seems marked with, too big, too fast, too much, and too soon.

The reality seems to be that most organizations arent overrun by good decision makers, yet alone great ones. When asked, people dont easily point to what they regard as great decisions. Stories of bad decisions and bad decision-making come much more readily to mind. Some of that is due to our tendency to notice and recall exceptions vs. all the times things go as planned. For example, youve walked along side buildings more times than you could possibly count. Yet you remember vividly the one time you got nailed by a pigeon overhead. Thats how we are about bad decisions. Were also that way because the really bad ones tend to really hurt. Its not that people dont have the capacity to make high-quality decisions in them. Decision-making is a distinctly human activity. Its what that great, big frontal lobe is for. We all make decisions all the time. But the fact that were hard-wired to make decisions doesnt by itself make us good decision-makers. That takes discipline: discipline to do at least four things all the time and well. 1. Realize when and why you need to make a decision. 2. Declare the decision: decide what the decision is, how youll work it, and who should be involved. 3. Work the decision: generate a complete set of alternatives, gather the information you need to understand the possibilities and probabilities, and ultimately make a choice that best fits your values. 4. Commit resources and act. For a more exhaustive list of decision principles, go here Not everyone does those four things consistently or consistently well. Weve worked with a lot of leaders and managers in some of the most widely regarded companies in the world and our observation is that most people dont. In fact, the distribution generally looks something like this:
y y y

There are some really wretched decision makers. For them, a good outcome is usually a matter of luck. There are a lot of people who are reasonably competent decision makers. Their decision processes arent great, but theyre not bad, and the outcomes they experience track accordingly. There is a small group of people who could be described as good decision makers These people are proactive and decision oriented. Theyre able to focus attention on whats important and critical. They know how to break a decision down into logical parts. They know how to work each of those parts in a high quality way. They know how to deal with possibilities and probabilities. Theyre able to see opportunities where others see problems. Theyre able to make quality choices in the face of uncertainty. Theyre able to turn thought into action. There is a sprinkling of people wed describe as great decision makers. Like other good decision makers, these people consistently make high quality decisions. Their greatness, a word that is probably way overused, comes from their ability to create the dynamics needed to ensure that the people in their organizations can do the same.

Good and great decision makers expect high quality outcomes and theyre generally not disappointed. When they are, its usually because of some random thunderbolt or some unforeseen dynamic, not because they didnt do a good job of working the problem. There are exceptions to this syllogism. But over the long-term, we think the good decision/good outcome connection holds up, and the outliers have either not been in the job long enough for their bad decisions to catch up, or have been extraordinarily lucky.

What is a Decision?
A decision is a choice between two or more alternatives. If you only have one alternative, you do not have a decision. Websters 9th Dictionary adds some richness to the idea of choice by introducing the idea of uncertainty. It has this to say about the word decide, the root of decision Decide: to arrive at a solution that ends uncertainty or dispute. From Latin decider which means to cut off. A typical thesaurus might use words like accommodation, agreement, arrangement, choice, compromise, declaration, determination, outcome, preference, resolution, result, and verdict to try and give the concept of decision some dimension.

In our minds Websters definition and these potentially illuminating synonyms seem to miss the driving idea behind a decision. A decision as an irrevocable allocation of resource. This is where the concept of attention comes in. Attention implies the use of resource. It means you actually allocate some time, money, effortsomethingto turning your intentions into action. The concept of irrevocability means commitment: putting time, money, and/or resource on the line to put your decision into action. Having decided, youre not going to re-litigate your decision every time someone has a new thought. Getting to that point with confidence is what separates low quality decisions from high quality decisions, and mediocre decision makers from good and great ones.

Making High Quality Decisions

A high quality decision comes with a warrant: a guarantee. Not a guarantee of a certain outcome remember this is the real world were talking about, and there are certain things that just arent knowable until after they happenbut a warranty that the process you used to arrive at a choice was a good one. This level of confidence implies a process: a set of steps and rules that provide an assurance of thoroughness and rigor. This means breaking decisions down into component parts and doing one thing at a time. Unless youre unlike most people, it is your nature to do what you know how to do and to avoid what you dont. Thats why you want a rational decision process: To defeat the natural behaviors and tendencies that can lead to low quality decisions. Without a process, you are likely to drag decisions into your comfort zone, handling this one in exactly the same way you handled that one, even though this one and that one may have little in common. Without an organizational decision process, that same stimulus/response, stay in your comfort zone dynamic can easily become the predominate driver of your organizations culture and effectiveness. As a leader, youre either doomed to inspecting every decision, or to hoping that people dont decide to do something stupid while youre not watching. With a process or framework, you have the mechanism you need to warrant the quality of your own decisions. Perhaps more importantly, you also have a common language and set of mental models that makes conversations about decisions more efficient and effective. This common understanding of decision processes, criteria, and roles avoids many of the common organizational decision traps, allowing people in your organizations to spend their conversational energies on creating better alternatives and validating assumptions and ultimately warranting their own decisions. The framework we use for breaking down and working decisions of virtually any size and complexity begins with two large ideas: declaring a decision and working a decision. Each of those larger elements is then broken down into three sub components, or what we call Decision Points, which are illustrated in the following diagram.

Decision Point 1: Frame the problem. What are you deciding and why? What shouldnt you be deciding and why? Whats not in the box is as important as what is. Without a good definition of the problem or opportunity to be worked, there is no possibility that you'll reliably reach a high quality decision. Frames are mental structures we create to simplify and organize our lives. They help us reduce complexity. Thats the good news and the root of another set of problems. Says J. Edward Russo in his book, Winning Decisions, Frames have enormous power. The way people frame a problem greatly influences the solution they will ultimately choose. And the frames that people or organizations routinely use for their problems control how they will react to almost everything they encounter. Decision Point 2: The Right People. If you're a single actor, or hold all the prerogatives of a dictator, this one is easy. It's just you. In other cases, you'll want to put some thought into declaring who needs to be involved in what steps of this decision. Too few, or miss some, and you risk the problems of rework, low adoption rate and poor buy in. Too manytoo much inclusionand you invite the possibility of an unnecessarily painful or drawn out decision process. Decision Point 3: The Right Process. Will you flip a coin? Throw darts? Check with your boss? Make decision tables? Use a decision tree or a bubble chart? Build a business case? It would depend on the decision situation. Making a high quality decision doesnt have to be time consuming. In some cases, the best process might just be a coin toss or relying on some rules of thumb. In other cases, the only way to work a decision is to really work it, and that will take time. The only rule is that the mechanics of how youll work the decision to conclusion need to be appropriate to the size, significance, and complexity of the decision. How long is too long? When the cost of working the decision any further outweighs the benefits of making a choice. This element of declaration pulls the frame and people together into a coherent whole that will govern how you will reason this decision through. Decision Point 4: A complete set of alternatives. The more options you generate, the greater your chance of finding an excellent one . . . You should only stop generating more options when the cost and delay of further search are likely to exceed the benefit. (Russo) What is the right number of alternatives? That depends on how youve framed the question. Two terms are helpful in this regard. Collectively exhaustive means that the alternatives youre considering fill the frame: a rational observer would conclude that youve thought of everything that matters. Mutually exclusive means that the alternatives are unique and different from each other: theyre not just restatements of the same choice. Decision Point 5: Values against which to make tradeoffs. Values define your preferences among alternatives. They are your criteria. Values can be expressed by attributes.Attributes are characteristics of the outcomes that we find desirable or undesirable. They typically occur over time and may have some degree of uncertainty associated with them. For each decision, particularly those involving others, you need to make your definition of value visible, clear, and distinct. In commerce, the acid test of a value is often that you can measure it.


Decision Point 6: Information that describes the value of each alternative. Good decision-making requires not only knowing the facts, but understanding the limits of your knowledge. The most valuable insights are often found in exploring uncertainties and disconfirming information. The effective decision does not, as so many texts on decision-making proclaim, flow from a consensus on the facts. The understanding that underlies the right decisions grows out of the clash and conflict of divergent opinions and out of the serious consideration of competing alternatives. (Peter Drucker, The Effective Executive) You can wear yourself out gathering and analyzing information. What you want is insight that will help you judge the relative and comparative value of the alternatives youre considering. Leaders should focus on creating the dynamics that support organizational decision qualityon putting in place a decision framework and process that supports organizational decision qualityrather than raking through the detailed minutia of specific decisions. A high quality decision process highlights the frame, potential alternatives, and key assumptions the drive value. This allows leaders to spend their time declaring the right decisions, providing a set of common criteria, and testing the key assumptions of each decision.

Recently there has been substantial interest in developing models of individual consumer choice. Two of the most popular types of models are large-scale models of buyer behavior of the type proposed by Nicosia (1966) and Howard and Sheth (1969) and attribute models of preference based on the models of Fishbein (1967) and Rosenberg (1956). This paper will begin by summarizing the current state of research in these two areas, and then will suggest how the two types of models might be combined.


Buyer behavior models have addressed the question of how a buyer goes about gathering information for making a decision, how he makes a decision, and finally how the decision affects his attitudes and hence future decisions. In other words, they are attempts to describe buyers from "cradle to grave." These models are thus directed at the Herculean task of explaining buyer behavior in every facet. These buyer behavior models are usually stated in terms of a flowchart. These flowcharts suggest the general direction of flows from one endogenous variable to another. They do not, however, provide operational definitions of the constructs in each box of the flowchart, nor do they in general specify what exogenous variables affect the various endogenous variables. Moreover, they do not specify the mathematical form of the links between variables. Thus as such, these flowcharts are difficult to operationalize and study empirically (and in a predictive testing sense, impossible to test at their current stage of development). Because of the problems involved in investigating these models, most initial "tests" of the models have been relatively simplistic, albeit relatively sophisticated statistically. Using examinations of the Howard-Sheth model as an example (Farley & Ring, 1970; Lehmann, Farley, & Howard, 1971; and Lehmann, O'Brien, Farley & Howard, 1971), several interesting observations are possible: 1. The "tests" have been largely cross-sectional. 2. The mathematical form used has been linear.

3. Parameter estimates have been made across people using regression (either OLS or TSLS). 4. The results are encouraging but mixed. The links in the cognitive side of the model, including such variables as brand comprehension, attitude, intention, and purchase have been both significant and plausible. The links among the informational variables, such as attention, perceptual bias, and overt search, on the other hand, have been much weaker. At this point, many areas of the Howard-Sheth model are largely unexplored, including: 1. Non-linear forms 2. Lagged forms 3. Alternative operational definitions 4. Individual parameter estimates. Thus the major characteristic of these general buyer behavior models is their limited operationalization.


Perceptual mapping models differ substantially from full-scale buyer behavior models. They focus on explanation of individual preference, and are not immediately concerned with either information reception on the one hand or choice on the other. The essential feature of these models is that they view brands as a collection of positions on a set of attributes, and preference toward a brand as some weighted combination of the positions. Perceptual mapping models can be expressed graphically as in Figure 2. The essential postulate of these models is that the "closer" an alternative is to the ideal, the more preferred it is. In Figure 2, this would imply, assuming attributes 1 and 2 were equally important. that alternative A is the most preferred. A variety of trends in the literature has suggested the perceptual mapping approach. In economics, Lancaster (1966) has proposed a utility theory based on the characteristics of a good instead of the good as a whole. The multidimensional scaling literature suggests that preference is a function of the distance of an object from the ideal (Green & Carmone, 1969; Kruskal, 1964 a & b; and Shepard, 1962 a & b). In social psychology, two very similar theories of attitude have been provided (Fishbein, 1967; and Rosenberg, 1956) which suggest that attitude is a weighted sum of positions on dimensions. Thus the essential concept that an object can be viewed as a point in n dimensional space is widely supported. One reason why these research traditions were not merged sooner is the differences in terminology used to describe them. In order to make the similarity more obvious, the following glossary is useful:

TABLE With one important exception (Einhorn & Gonedes, 1971), all the perceptual mapping models proposed have been of the following form: EQUATION where Wi = weight of the ith dimension Pji = position of the jth object on the ith dimension

Ii = ideal position on the ith dimension K = an integer and n = number of relevant dimensions. In other words, the attitude is a weighted sum of distance to the ideal on each of the relevant dimensions. Depending on the way Ii and K are defined, Yj can take on many forms. For example, a K = 1 implies city block distance while a K = 2 implies Euclidean distance. In two past tests, city block distance has proven best predictively (Bass, Pessemier & Lehmann, 1971; and Lehmann, 1971). However, other considerations, such as stability under orthogonal rotation (city block distance is not, while Euclidean is) and utility theory implications (city block implicitly assumes constant marginal utility on the attributes, while Euclidean is one form of diminishing marginal utility) may dominate in the selection of a distance measure. In any event, several alternative distance measures are available. The relationship of distance to the ideal, similarity (which is the inverse of distance) to the ideal, attitude, and preference are also somewhat confusing. The relationship can be summarized as follows: TABLE Actually, preference is usually a comparative measure between attitudes, but for purposes of these perceptual mapping models, the two terms are largely synonymous. Thus the differences between the traditions in the literature are largely semantic. A more fundamental reason why these traditions in the literature were not synthesized sooner is that there are essential differences between the models in terms of the way the dimensions arise. Two basic approaches exist, and they differ in some important features: TABLE Yet in spite of these differences, the essential similarity of these approaches is obvious. Tests of these perceptual mapping models have differed substantially from those of the Howard-Sheth model. Because the mathematical form of the relation is pre-specified, the model is more operational. Efforts have centered around measurement of the three basic constructs (preference, weight, and position) and deducing the relevant dimensions. In general, the tests have been greatly encouraging. Indirectly derived dimensions have proved useful in explaining preference among such diverse alternatives as automobiles (Green & Carmone, 1969), jobs (Hill & Pessemier, 1971), and political candidates (Johnson, 1970). Ratings on pre-specified dimensions have proved successful in analyzing such alternatives as television shows (Lehmann, 1971), soft drinks (Bass, Pessemier & Lehmann, 1971), and numerous branded products (Bass & Talarzyk, 1972; Ginter, 1972; and Winter, 1972). In all these examples, predictions based on a perceptual mapping model have greatly outperformed both demographics and random models. In spite of these encouraging results, there are some important problems involved with applying perceptual mapping models. As stated, these models are largely tautological and as such can be investigated but not truly tested. Also attempts to use a subject-estimated ideal point have been disappointing (Bass et al; 1971; and Lehmann, 1971). Finally, the weights have not proved to be very useful (Lehmann, 1971; and Sheth & Talarzyk, 1972) for a variety of reasons (Beckwith & Lehmann, 1972). Thus substantial testing and refinement of these models is also needed. A SYNTHESIS

Looking at the pictorial representations of the two models of individual behavior (Figures 1 and 2), one is struck more by the differences than by the similarities. Considering the problems involved in testing either separately, the obvious question which arises is: "Why attempt to synthesize them?" The answer is that by combining them, both may benefit. The obvious weakness of the perceptual mapping approach is that it does not suggest either how information influences the individual or how preference is related to choice. Placing it in the context of a general buyer behavior model suggests both. On the other hand, the obvious weakness of the buyer behavior approach is the imprecise formulation of the links between blocks in the flowchart. Using perceptual mapping makes some of the links both explicit mathematically and empirically viable. To see how a perceptual mapping model might be combined, consider the Howard-Sheth model (Howard & Sheth, 1971), which is currently under revision (Howard & Ostlund, 1973), portrayed in Figure 1, and the perceptual mapping model represented by Figure 2. The perceptual mapping model can be viewed as a combination of four constructs: 1) Choice criteria, 2) Weights, 3) Brand comprehension, and 4) Confidence. The choice criteria can be viewed as the dimensions of the perceptual map and the weights as the weights attached to the dimensions. Brand comprehension could be treated as the position of the brand on the dimensions. Finally, the random component representing uncertainty suggested for introduction into the perceptual mapping models (Lehmann, 1971 a;$ 1972 a $ b) can be considered as a measure of confidence. In other words, the center of the Howard-Sheth model could be viewed as a perceptual mapping model. FIGURE 1 HOWARD-SHETH MODEL FIGURE 2 TWO-DIMENSIONAL EXAMPLE One advantage of this synthesis is the improved explanatory power for the center of the Howard-Sheth model. Another is that the "new" model can be expressed very simply (Figure 3). Possibly the most important advantage of the synthesis, however, is that it suggests how advertising and other information affects choice. Simply stated, this new model suggests that advertising influences choice by changing either the positions on the dimensions, the weights of the dimensions, or the ideal position on the dimensions. As such, it provides a structure for future research on the informational side of the model which has to date proved the most difficult to investigate. CONCLUSION Two major research traditions dealing with the individual consumer have emerged: Buyer Behavior Models and Perceptual Mapping. In spite of the problems involved in attempting to test (or at least investigate) these models, both have shown great promise. This paper suggests that combining the two traditions will be to the mutual benefit of both. FIGURE 3 A SYNTHESIZED MODEL REFERENCES Bass, Frank M., Edgar A. Pessemier, & Donald R. Lehmann. An Experimental Study of Relationships Between Attitudes, Brand Preference, and Choice. Paper No. 307, Institute for Research in the Behavioral, Economic, and Management Sciences, Herman C. Krannert Graduate School of Industrial Administration, Purdue University, April, 1971.

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