New

(Daily Information Capsules for all those who want to fathom learning in all its depths)

Date: 15th April 2004

(To be used by faculty members AND a copy to be kept for students reference in the Library too)

CONTENTS
The following pages contain:
1. 2. 3. 4. N e w s T r a c k e r : The edit will give you links to important and happening news, which you just cant afford to miss. Follow the link and read the articles suggested. P o o l o f K n o w l e d g e : A collection of definitions and meanings of terms from a selected field of study. S p e c i a l i z e r : An article by the gurus on Management Fundamentals. Q u i z : A GK quiz on Current Affairs, Brand Quiz and Companies Punch lines etc., to check your reading habits and to hone your memorizing skills!

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NewsTracker
Instructions: We suggest you copy-paste the link on the address bar of your Internet explorer. Avoid keying it through your keyboard because it might be prone to errors.

CHEERS FOR MULTILATERALISM

The World Trade Organisations Appellate Body deserves congratulations for pulling up the European Commission (EC) for its discriminatory trade practice in granting tariff preferences to 12 developing countries including Pakistan. In a strong vindication of Indias position, the Appellate Body has ruled against tariff preferences granted to these countries for their assistance in the ECs war against drugs. The ruling comes as a shot in the arm for Indian exporters and is another reason for India to redouble efforts to strengthen the mutilateral mechanism. Unlike bilateral trade agreements, where trade preferences can be extended on a selective basis, the beauty of the multilateral system is that it does not permit discrimination between trading partners. Therein lies the strength of the WTO. Trade policy instruments cannot be used to serve political objectives. For a country like India that is just a lightweight in global trade that is the best bet for the future. http://economictimes.indiatimes.com/articleshow/612523.cms

ARE YOU A VALUABLE ASSET OR LIABILITY FOR YOUR BANK?

Watch out, you are on your banks radar. Banks these days constantly monitor their customers financial behaviour both inside and outside the bank branch. The questions that come to the mind are several. First, how do they do that and why would the banks do that, what do they stand to gain from it? But, the most important question is how it affects you as a customer? Government, private and foreign banks analyse each customers financial behaviour, in terms of average balances maintained, number of cheques used each month, number of cheques dishonoured and many other things such as regular payment of loan instalments, credit card payments and so on. The next logical question is how do banks benefit from this data. They use this for two objectives; the first is to determine the profitability of each customer to the bank. While the second main objective is that, this data helps them select customers for profitable cross-selling opportunities. Most banks these days have a proxy profit and loss statement for each customer, which records the revenue the bank earns from each customer and the money the bank spends in servicing the customer. Read the article to know how both banks and customers benefit from such inspections. http://economictimes.indiatimes.com/articleshow/607766.cms

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ARRIVING AT GOODWILL
While purchasing property, especially commercial property, the buyer has to invariably pay up for goodwill. Usually the amount is quite heavy. But what is this goodwill? How is it calculated? Are there any hard and fast rules governing determination of goodwill? Is it synonymous with premium? These questions often puzzle a buyer. It is a quality that will bring to the purchaser profits in future, almost without his efforts. The efforts have already been made in the past. Goodwill is the ability to earn profits higher than other firms. It enables earning of excess profits over and above what normally firms earn. Goodwill arises only if the firm is able to earn super profits. Goodwill is nothing more than the probability that the old customers will resort to the old place or to a particular place or supplier. It enhances the capacity of the business to earn profits in the future. Read the article to get these answers. http://economictimes.indiatimes.com/articleshow/607745.cms

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Pool of knowledge
All the terms and definitions that have baffled you all these days. Get acquainted with them and solve all your queries.

Marketing:
Narrowcasting - a term used in reference to cable television in the U.S., where cable TV stations, with specialised interests such as sports, news, weather, movies, etc, allow advertisers great selectivity; that is, advertisers can in arrow cast their messages rather than broadcast them. National Account Marketing - the creation of marketing teams or groups (NAM Teams) within a company specifically to meet the needs of major client organizations; the teams or groups usually consist of marketing and sales personnel as well as engineers, production specialists, and so on. National Accounts - major accounts which are sometimes served by a separate sales force because of their importance. Account specialists try to meet their special needs and to develop close relationships with key personnel. Also referred to as Direct Accounts and House Accounts. National Introduction - the immediate launch of a new product on a nation-wide scale. Because of the risk and the substantial investment in production and marketing that a national introduction requires, many organisations choose rollout approach instead. National Marketing Manager - a marketing manager with the responsibility for the nation-wide operations of a marketing division. National Sales Manager - a sales manager with responsibility for the nation-wide operations of a sale division. Near-Pack Premium - a sales promotion in which a gift is to be collected from elsewhere in the store by consumers who have purchased a particular product. Need-Directed Consumers - one of three broad groups of consumers (with outer-directed consumers and inner-directed consumers) identified in the Stanford Research Institutes survey of American lifestyles. Needdirected consumers, representing about ten per cent of consumers in the U.S., are motivated by need rather than by choice. Need-Gap Analysis - an approach to identifying the unmet needs of consumers, in which respondents are asked to envisage the ideal brand or product and then to rate various existing brands or products on key attributes; if no existing brand or product measures up to the ideal, a gap exists which could be filled by a new brand or product. Need Objection - an objection by a prospective buyer that they have no need for the product offered by a salesperson. Need-Satisfaction Approach - an approach to selling based on soliciting information to uncover a buyers need before attempting to present an appropriate product from the range to satisfy it.

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Negative Demand - demand for products which consumers dislike and would prefer not to have to purchase. Negative demand for a particular product exists when consumers, generally, would be prepared to pay more than the price of the product to avoid having to buy it, as in the case of unpleasant and painful medical treatment. Negotiated Contract - a formal arrangement for the supply of goods or services at a price agreed upon both the buyer and seller. Negotiated Price - a price agreed upon for the supply of goods or services by both buyer and seller. Negotiated Rate - a non-standard charge for the carriage of goods agreed to by both manufacturer and transport company. Negotiated Selling - a selling approach in which a salesperson attempts to produce a win-win outcome for both parties. The approach entails the assumption of a partnership between buyer and seller, the salesperson acting as a counsellor to assist the buyer to find the best solution to a problem. Networking - establishing an informal set of contacts among people with common social and business interests as a source of prospects, for the exchange of information, and for support. New Account - Conversion Ratio - a measure used to evaluate salespeople in which the conversion rate of prospects to customers is calculated. New Product Committee - a group within a company responsible for new product policies, including the assignment of priorities to options and ideas for new products and the final decision on whether or not to commercialise them. New Product Department - a permanent department within a company responsible for overseeing the development of all new products. New Product Development - the creation of new products needed for growth or to replace those in the decline stage of their life-cycle; the stages in the new product development process are commonly listed as idea generation; screening; concept development and testing; the formulation of marketing strategies; business analysis; production; market testing; and commercialisation. New Product Duplication - the introduction by a company of a product that is known to the market but new to the company. See Innovation; Product Extension. New Products - products which are new in one or other of two new to a company or new to a market; they include existing products which have been improved or revised, brand extensions, additions to existing line, repositioned products targeted at to new markets, and new-to-the-world products.

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Specializer Business management skills The Art of Management: the triple talents of the manager, the entrepreneur and the innovator-II
By Robert Heller RELIABLE MAXIMS I would include the importance of that principle among the 'reliable maxims, which together with instructive anecdotes and the avoidance of dogmatism, I deemed (and still deem) more useful to cook/managers than detailed instructions. These aim to substitute book-learning for practical experience and hard results - and as lThinking Managers has pointed out, you cannot expect to manage by rote. You can derive those reliable maxims from studying the great exponents, but their actions and theories have the limited force of anecdotes, and fall well short of the power of universal laws. That's why what is taught as management at business schools has only a partial bearing on the realities of business life. Nobody pretends that you can teach somebody to be an entrepreneur like John D.Rockefeller or an innovator like Edwin Land of Polaroid. You can show people (as Edward de Bono does so brilliantly) that they are capable of far more creativity than they (or others) believe. The test of their creativity is not their learning, but their results: not the technology, but the product. This has great relevance to management, which, as many have written, is not a science, but more an art. Yet curiously I know no book which discusses The Art of Management: there is a very well-known book, widely read by managers, which deals with The Art of War - but this dates back to ancient China. Despite its antiquity, though, the book gives many useful analogies, not least that management is a close relative to military command: hence the almost universal adoption of military modes like the separation of line and staff, and the supreme, overweening authority of the Commander-in-Chief (for which read CEO). TRIPLE TALENTS As suggested above, this supremacy has resulted in a dangerous cult of adulation. If you are a Rockefeller or a Land, this can hardly be helped. Your creation has provided jobs, wealth and consumer benefits right round the world. You are inevitably a super-star. But stardom has nothing to do with the processes that make one company more effective than another. Those processes require the Triple Talents of the manager (who makes things happen), the entrepreneur (who makes things start) and the innovator (who makes things different - and better). There's a fascinating illustration of the Triple Talents in the recent history of Procter & Gamble. As the inventor of modern brand marketing techniques (including the soap opera), P&G became a byword for innovative management (and innovative products like Crest toothpaste and Pampers diapers). But from the 1980s onwards, the great company fell into the hands of veteran managers whose efforts to innovate failed to compensate for slowing sales of the block-buster legacy brands. The inbred corporate culture, which had been seen as a great strength, was now regarded as a liability - a bulwark of conservatism.

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When the weakness of the stock price finally made the need for change imperative, P&G turned to an insider, Durk Jager, who sought to bully the company and the consumer into submission to his will. When the new products and the earnings flopped, Jager was assisted out of the door. His replacement, A.G. Lafley, another veteran, has presided over a turnaround that's very visible in the share price (up 58%) - and has already been lionised in magazine profiles. From one of them, in BW, emerges a clear picture of Lafley's version of the first talent - management: 1. 2. 3. 4. He gives human resources priority, personally tracking the performance of 200 senior executives. He made managers concentrate on the major brands ('instead of trying to develop the next big thing'). He made an ally rather than an enemy of the culture. He changed the style at the top: quiet manners; moving top executives away from their 11th floor eyrie; meeting with 12 seniors at a round table every Monday morning - and, above all, listening.

The above quartet admirably demonstrate that prime art of the manager - making it happen. But what Lafley has made happen is less impressive; indeed, it's fairly standard practice for the large corporation in the 2000s. He has cut employment, made two major acquisitions, replaced half the top 90 managers, and turned to outsourcing in a big way. It's hard to see any evidence here of the two other Triple Talents, entrepreneurship and innovation - and P&G will surely need both to meet intense competition and the immense power of Wal-Mart: the giant retailer could before many years have passed account for a third of P&G sales. ARTISTIC GENIUS Lafley could, of course, surprise his critics by dynamic moves in the marketplace and elsewhere. But it's asking a great deal of any leader to combine the Triple Talents in one person. What the great manager does is to emulate the artistic genius by seeing the whole picture. Read the wonderful letters of Vincent van Gogh, and you will see exact discussion of technique and detail - but all set within a total concept of the image he wanted to create on paper or canvas. The manager likewise needs imagination to see what the business can become and to enlist the help of the people best able to start new ventures and develop the different and better. Then the CEO can hope to pass the acid test: passing on a company in such good shape that the successor managements will do even better. (Lafler's predecess-ors at P&G failed this test abysmally). Managers have spent a long and painful time waiting for the upturn. Now that it has probably arrived, the only sensible recipe is to deploy and develop the Triple Talents at all levels - then the good times can go on rolling.

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Quiz!
DIRECTIONS: For the following questions, choose the correct option. Q1. Who is the richest Asian in UK? (1) Lord Swaraj Paul (3) Sonal Shah (2) (4) Lakshmi Mittal None of these M Phasis Aptech Computers

Q2.

Vijay Thadani is the CEO of which IT Company? (1) NIIT (2) (3) MBT (4)

Q3.

Which movie was recently voted as the best family movie? (1) ET (2) Lord of the Rings Trilogy (3) Star Wars (4) Willy Works and the Chocolate Factory Craig Barrel is the CEO of which computer chip maker firm? (1) Intel (2) Cyrix (3) Motorola (4) None of these What is the current inflation rate? (1) 6.2% (3) 4.0% (2) (4) 4.4% 3.2% Tata Motors Hyundai Motors

Q4.

Q5.

Q6.

Opel Corsa is a product of which motor company? (1) General Motors (2) (3) Maruti Suzuki (4)

Q7.

Singapore Technologies Telemedia (STT) is the telecom subsidiary of which company? (1) Temasek (2) AT & T (3) DBS (4) None of these Crisil picked up 9% stake is which company? (1) American Rating Agency Ltd. (3) Economatters Ltd. (2) (4) Caribbean Information & Credit Rating None of the above Telecom Regulatory Authority of India None of these Rahul Bose Rahul Dravid

Q8.

Q9.

Pradip Baijal is the Chairman of which organization? (1) CRISIL (2) (3) VSNL (4) If Rahul Gandhi is in Amethi, who is in Lahore? (1) Tushar Gandhi (2) (3) Varun Gandhi (4)

Q10.

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Q11.

Which of the following features distinguish musical sounds from noise? 1. Regularity in sound 2. A musical sound has a single frequency 3. Absence of sudden 4. 3..changes of amplitude in respect of musical sounds (1) 1 and 2 (2) 2 and 3 (3) 1 and 3 (4) 1, 2 and 3 Fertility of soil can be improved by (1) Adding dead earthworms (2) Removing dead earthworms (3) Adding living earthworms (4) Removing living earthworms and adding Ozone attacks (1) Glass (3) Copper

Q12.

dead earthworms (2) (4) Mercury and silver None of these

Q13.

Q14.

'When used for benign purposes, this is known simply as fertiliser. But when mixed with diesel fuel and set off, if has a detonation velocity of 1,100m per sec'. The powerful tool of destruction referred to above is (1) C-4 (2) TNT (3) Semtex (4) Ammonium nitrate The process by which kidney stones are shattered with shock waves is called (1) Lithotripsy (2) Laparoscopy (3) Endo-capsular implant (4) Dementia

Q15.

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Answers
1. 2. 3. 4. 5. 6. 7. 8. 9. 10. 11. 12. 13. 14. 15. Ans.(2) Ans.(1) Ans.(4) Ans.(1) Ans.(2) Ans.(1) Ans.(1) Ans.(2) Ans.(3) Ans.(4) Ans.(3) Ans.(3) Ans.(4) Ans.(4) Ans.(1)

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