A STUDY ON CONSUMERQuestionnaire and the In-depth Interviews through the questionnaire with the...

1KIIT Journal of Management, Vol-7, No-3, Jan. - Dec. - 2012

A STUDY ON CONSUMERPERCEPTIONS AND EXPECTATIONS

FOR TATA NANO

Dr. Garima MalikAsstt.Professor (Marketing & Sales),

Amity Business School, NoidaEmail: [email protected]

Abstract

This paper is derived from a larger scale project investigatingconsumer attitudes towards Tata Nano. It presents focus group resultson consumer perceptions, attitudes and behavior in relation to preferringand purchasing the Nano. The paper studies the primary data of 150respondents across NCR (National Capital Region). To explore thecustomers’ perception of Nano, analysis is done on various variableslike price, style, attributes, availability, and factors affecting the Indiancustomers. A study of the performance of the retailers is also done forfastest sales conversion. Factor analysis and cross tabulation wereemployed to the dataset. It was found that the three major factors thatinfluence the decision of purchasing the car are price, fuel efficiency andperformance of the car. The study also revealed that majority of therespondents like the car because of its style and the reasonable price. Itwas also found that 70 percent Nano customers already had a car. Withthe increasing competition amongst automobile companies, the findingscan act as a strategic tool to achieve competitive advantage and customersatisfaction.

Keywords: customer perception, attributes, automobile companies

Introduction

Tata Motors Limited is India’s largestautomobile company, with consolidatedrevenues of 92,519 crores (USD 20billion) in 2009-10. It is the leader in

commercial vehicles in each segment, andamong the top three in passenger vehicleswith winning products in the compact,midsize car and utility vehicle segments.Refer to figure 1.

2Parikalpana - KIIT Journal of Management

Figure 1 : Market Share of Automobiles companies

Source: Business World May 2010.

Nano has been a mega success ingenerating public interest. Given its onroad price ranging from Rs 1.23 lakh toRs 1.85 lakh (albeit it being slightly aboveexpectation), the car has robust potentialof being a market success. According toCrisil Research estimates, the new pricepoint reduces the cost of ownership ofan entry-level car in India by 30 per cent.This will make the car affordable to anadditional 14 million families, including asection of the 58 million two-wheelerowners.

“At present, an estimated 27 millionpeople can afford a car while the present

number of car owners is nine million. Withthe introduction of Nano, the number ofpotential customers will rise to 41 million,”says Sachin Mathur, Head of Research,Crisil.

“Nano will capture share from the two-wheeler market. If it captures just five percent of the two-wheeler sales, which is80 lakhs per year, four lakh units will bethe annual sales,” explains Vaishali Jajoo,auto analyst with Angel Broking Ltd. “Ifit performs well, it can also cannibalisefrom the small car market (Table 1).Typical Maruti 800 and Alto customersare not looking for power or

3A study on consumer perceptons and expectations for Tata NANO

performance. They are generally utility-oriented and Nano may fit the bill”, sheadds. However, it throws up hugechallenges as well. The productionconstraint which restricts the first year

volume to around 50,000 units means ahuge demand-supply gap. “The targetgroup would be typical two-wheelerbuyers who traditionally show higher rateof delinquency.

Table 1: Comparison with competitors

Research Objectives• To study & analyze the general

perception and awareness aboutTata Nano.

• To discover the factors thatinfluencing the purchasing decisionof the car with concern to Nano

• To gather information regarding theexpectations from Tata Nano.

Research Design

Research Design used here is ofExplorative nature because the

researcher needs to obtain a veryspecific picture about the perceptionand preference of Tata Nano. It hasbeen used to get an accurate ideaabout a specific segment of the marketsuch as level and extent of brandawareness and preferences amongconsumers.

The sampling method used is a Simplerandom sampling. Within randomsampling, judgment sampling methodsare used.


Data Collection Method

The data collection method used for theresearch purpose in this project is theQuestionnaire and the In-depthInterviews through the questionnairewith the customers. The data for thepresent study are obtained by theadministration of a questionnaire, whichcontains two parts, the first part containscolumns for personal information and thesecond part contains factor influencingscale as consisted of 22 statements. It wasmeasured on a Likert’s 5 point scaleranging from strongly agree, agree,neutral, disagree and strongly disagree.Regression analysis and factor analysis areemployed to deduce findings.

Prior to this survey, a Pilot Survey wasperformed to test the probability of the

success of the research work, which wasto be performed later during the project.For this, around 10-15 people werequestioned. This pilot study was done ona small sample of 10-15 individuals toassess the effectiveness of the researchover a short period of time. Theinferences drawn were then extrapolatedas per the requirements of the researchand the larger sample with a longerduration of time was assessed to attainthe overall research objective. A total of150 respondents were surveyed.

Profile of Respondents

The demographic characteristics of therespondents in Table 2 indicate that themajority of respondents of belong to theage group of 20 to 30, followed by theage group of 30 to 40.

Table 2 : Demographics Characteristics of Respondents

Demographic Characteristics Percentage

AgeBelow 20 4%20-30 61%30-40 13%40-50 10%50 & Above 12%Income groupLess than 5 Lakh 92%5 to 7 lakh 5%7 to 9 Lakh 2%9 to 11 Lakh 1%Line of WorkService 39%Business 28%Teaching 2%Student 29%Defense Service 2%


Keeping in mind the objective of thestudy, a major share of the sample waschosen from the population with anAnnual family income of less than 10lakhs rupees. Only 1% of the respondentsbelonged to the income group of morethan 9 lakhs per annum. A good mix ofrespondents, from different line of works,was tried to be maintained.

Findings and Analysis As Nano has brought innovations in theautomobile sector all over the world,specific questions were asked aboutmajor factor/factors influencing thepurchasing of the Nano.

(Table 3A)KMO and Bartlett’s Test

(Table 3B) Total Variance Explained

Hence all theses standards indicate thatthe data is suitable for factor analysis.Principal component analysis isemployed for extracting factor.Orthogonal rotation with varimax isapplied. The latent root criterion is usedfor extraction of factors. As per this,

only the factors having Eigen valuesgreater than 1 are consideredsignificant; all the factors with Eigenvalues less than 1 are consideredinsignificant and disregarded. For thisstudy there were only 5 factors havingEigen values exceeding 1.


Extraction Method: PrincipalComponent Analysis

The total variance of the 22 items is found tobe 96.800 which is significantly greater thanthe benchmark variance value, that is, 60%.

Factor I: Price of the Car is the firstfactor loading four variables mainlyrelating to cot of the car. All fourvariables in the factor reflect, “valuefor money-0.947”, “status of the car-0.845”, “features according to theprice of the car-0.957”, resale value-0.912", etc.

Factor II: Performance &Maintenance cost loading of 5variables pertains to the maintenanceof the car. The Maintenance variablesthat have high correlation with thisfactor are the availability of servicecentres, spare parts, efficiency, etc.

Factor III: Factor 3 is characterizedby two variables that reflect fuelefficiency of the car. Three variablesrelated to speed of the car, efficiencyof the car in traffics etc.

Factor IV: After Sales Service is the4th factor reduced using PrincipalComponent Analysis containing 4items “dealing with cutomers-0.945”,“Feedback of the customers–0.974”,“Availability of the Stand by Car–0.973” & “Pick and Drop facility–0.922”,

Factor V: Look & comfort is the 5thfactor reduced using PrincipalComponent Analysis containing 4statements “Perception of thereference groups -0.985”, “ Style ofthe Car– 0.977”, “ Status of thePurchaser – 0.935” & “ Size of thecar- 0.845”.

Purpose associated with Nano: Inthis question respondents were askedto tell the purpose of purchasing theCar. For example, personal use, thelow price of Nano that is an advantageover the two-wheelers. Further theanalysis is carried on with referenceto age group and occupation ofrespondents that shown in Table 4 andTable 5.

Figure 2: Purpose of purchasing the Nano


It is clear from Figure 2 that the purposethat Tata Nano is most associated with,is for its utility within city. Tata Nano was

chosen by a major share of the populationto be of best use as a substitute for a 2wheeler and for personal use.

Table4: Cross Tabulation of Purpose with Age group

It is revealed from the above table thatmaximum people in the age group of 20to 30 years consider Nano for its utility

within the city. It is only the people inthe age group of 30 to 40 years that seesit as a family car.

Table5: Cross tabulation of Line of work with purpose of purchasing Nano


Note: F –Frequency, P-Percentage

The above table depicts that most of thepeople in business see Nano as asubstitute for a 2 wheeler, while peoplein service, see it more as a Family carand, along with students, find it mostsuitable for the usability of the car withinthe city.

Suggestions

This section of the study covers thesuggestions given by respondents.Some features that the customers forNano would appreciate or would liketo see in the car are as follows:

• A.C• Powerful Engine• CNG• Good Looking Headlights• Air bags• Comfort Features• Elegant Engine Sound• A Richer Look on The

dashboard• Twin Viper• Large Boot Space

The people expecting Air Conditionerin the car just exemplify the unawarenessabout the car. There have been manyinputs regarding the noise of the engineand thus an elegant engine sound was alsoa major suggestion. There also existsconcern regarding the security features ofthe car and thus many also suggested thatthere could be air bags available in thecar.

Some accessories

Of all the people willing to considerNano for their next purchase, theaccessories that they would like todecorate their cars with were mainly.

• Music System• Bluetooth Facility

Some suggestions from the respondentsto make the buying experience

better

� Address the safety concern

� Advertisement

� Better customer dealing

� Discounts & Accessories

� Less waiting time

� Offer Warrantee

� Provide finance

� Quick & convenient paper

work

� Quick delivery

� SMS updates about

expected date, web based

booking


Other Suggestions

• Extensive advertising as a‘youth car’

• Marketing of the car not just as‘A car for all’ but a special car.The commoner tag to the carshadows the exclusivity of thecar

• Programs to eliminatemisconceptions about the carand educate people about theutility of the car

• Market the car with emphasis onthe ‘beautiful design’ of the car,a strategy used by Hyundai topromote Santro.

Results & conclusion

The conclusions derived from the researchare that reasons for decreasing enthusiasmfor the car have been, Lack ofadvertisements, thus lack of information,Long waiting time, Bad word of mouthand reports in the market, like ‘Auto-rickshaw’. But it has been found thatNano scores high on both of the top twopurchase influencers for car buyers –Price & fuel efficiency but in reality thecompany still isn’t positioned so. This isattributed to lack of awareness forovercoming this drawback thecompany has to plan effective promotioncampaigns & execute the same so as towidely spread awareness about the car.And Nano finds a major market withpeople aging between 20 to 30 years, so,for that Nano may be positioned as a

‘Young Car’ so as to attract this segmentBut misconceptions exist about Nano notbeing safe and about it being congested.Although, the customers are using thevehicle are extremely happy with the car.The wonderful experiences of thecustomers can be used as a tool to ‘clearthe air’ about Nano by means of customermeets and advertisement of the same.Nano is more popular with the serviceclass and the student population. The carmay be targeted specifically to thatsegment. Many complaints were recordedfor poor customer dealing both at dealerand company end, thus resulting in notjust dissatisfied customers but also badword of mouth. Special care could betaken to strengthen people’s confidencein the customer relationship and dealingsat TATA MOTORS.

REFERENCES:

• Bartels, R.: (1967), “A Model forEthics in Marketing”, Journal ofMarketing (January) 31, 20–26.

• Ekin, M.G. and S. Tezölmez (1999), “Business Ethics in Turkey:An Empirical Investigation withSpecial Emphasis on Gender”,Journal of Business Ethics 18,17–34.

• Engel, J. F. and R. D. Blackwell(1982), “Consumer Behavior”,The Dryden Press, New York.

• Ferrel, O. C. and L. G. Gresham(1985), “A Contingency


Framework for UnderstandingEthical Decision Making inMarketing”, Journal ofMarketing (summer), 87–96.

• Forsyth, D. R.(1980), “ATaxonomy of Ethical Ideologies”,Journal of PersonalityAnd Social Psychology 39(1),175–184.

• Forsyth, D. R (1992), “Judgingthe Morality of BusinessPractices: The Influence ofPersonal Moral Philosophies”,Journal of Business Ethics(May) 11, 461–470.

• Fleming L.(2001), “Recombinantuncertainty in technologicalsearch”, Management Science47: 117–132.

• Spreng Richard, Harell Gilbertand Mackay Robert (1995),“Service recovery impactsatisfaction and intentions”,Journal of Service Marketing,Vol.9, No, 1, 15-23.

• Parasuramam, A., Zenithal, V., &Berry, L. (1988), “ SERVQUAL:A multiple item scale formeasuring consumer perceptions’of service quality” Journal ofRetailing, 64(1), 12-40.

• http://www.expressindia.com/latest-news/Tatas-Nano-fulfills-common-mans-dream/259927/http://www.scribd.com/doc/21385074/Case-Study-on-Tata-Nano

11Impact of Employee Trust on Organizational Commitment and Innovative Behaviour of Employees

Impact of Employee Trust on OrganizationalCommitment and Innovative Behaviour ofEmployees: An Empirical Study on Public

Sector Employees in Bhutan

Md. Hassan JafriLecturer (OB Area)

Gaeddu College of Business Studies, GeduRoyal University of Bhutan, BhutanE-mail: [email protected]

Abstract

The paper aims to see empirically, the impact of employee trust onorganizational commitment and its three dimensions (affective, normativeand continuance commitment). It also intends to see the impact ofemployee trust on innovative behaviour of employees. Using randomsampling method, data were gathered on a standard questionnaire froma total of 90 fulltime employees, working in two public sectororganizations in Bhutan. Correlation and multiple regressions were usedto analyze the obtained data. Results revealed that employee trust onemployer / organization contributes significantly on the development oforganizational commitment especially affective and normativecommitment. It was also found that trust influences employees’ innovativebehaviour significantly. The findings imply that the organizations,through policies and practices, should develop and maintain employeetrust and use it as a strategy to get organizational benefits - theircommitment and their willingness to be innovative in organization whichin turn may increase organizational performance.

Keywords: Employee trust, Organizational commitment, Innovativebehaviour.


INTRODUCTION

Trust may seem like a vague andintangible notion, but its value in today’seconomy is decidedly real and concrete(Accenture’s High-Performance BusinessResearch, 2011). According to Wyatt(2002), total return to shareholder (TRS)over a three-year period was 186%higher for those companies that had highlevels of trust compared to those with lowlevels of trust. Trust in organization hasbeen shown to influence a variety ofsubordinates’ work attitude andbehaviour (Brockner et al., 1997). Theconcept of trust has got significantimportance and has emerged as aprominent area of research in modernbusiness. The importance of trust is onlylikely to grow in view of continuedturbulent workplace environments(Ferres and Travaglione, 2003).Changing pattern of employmentrelationship characterized by fast changesin business environment has affectedemployee trust. The Institute ofLeadership and Management Index ofLeadership Trust (2009), based on asurvey of 5,600 workers, report that athird of workers claim that they have littleor no trust in senior managers. Trust isstrategically significant for theorganization’s increased productivity. Ithas been observed that severalorganizations are not able to develop and/ or maintain employees’ trust. Becauseof this several negative consequencesarises which may include low commitmentand reduced innovative behaviour among

other important organizationalconsequences. Both organizationalcommitment (Chughtai and Zafar, 2006)and employees’ innovative behaviour(Zhang and Bartol, 2010) have gainedsignificant importance in the presentbusiness environment for sustained andhigh organizational performance.

The issue of trust is a widely researchedconcept in the American and Europeancontext. But trust as a concept by large,is a relatively neglected area of researchin Indian sub-continent. The researcherhas not found any research showinginfluence of employee trust onorganizational commitment and especiallyon three dimensions (affective, normativeand continuance) of commitment.Moreover, the present researcher has notfound any study on this issue in Bhutanesecontext. Against this background, thepresent study will investigate empirically,the impact of employee trust onorganizational commitment and its threedimensions separately in two public sectororganizations in Bhutan. The study willalso explore impact of trust on innovativebehaviour of employees.

CONCEPTS AND LITERATUREREVIEW

Employee Trust

Trust is particularly important inorganizations characterised by uncertaintyand change (Currall and Judge, 1995).Trust in organizations is perceived asvaluable, attainable, necessary and


destructible, but it lacks a consistentdefinition (Lewicki et al., 2006). Conceptof trust has been defined from differentperspectives – behavioural, cognitive,affective, dispositional, normative etc.Lewicki, McAllister and Bies (1998)defined trust as a person’s degree ofconfidence in the words and actions ofanother. According to Rousseau et al.,(1998), trust refers to the psychologicalstate comprising the intention to acceptvulnerability based upon positiveexpectations of the intentions or behaviourof another. However looking at all thedefinitions available in the literature, itappears that the concept of workplacetrust involves fairness, faith andconfidence, expectations, vulnerability,uncertainty, risky situations etc. Howeverthis study defines employee trust as atrustor’s willingness to rely on trustee’sintentions and actions, have positiveexpectations in uncertain and riskysituations. Trust is fundamental to theexistence of healthy working relationships.Colquitt, Scott and LePine (2007) in theirmeta-analysis of 132 trust studies,concluded that trust is a vital componentof effective working relationships. Trust-based relationship between subordinatesand supervisors plays an important rolein acting for the accomplishment oforganizational goals in cooperation,increasing efficiency and productivity inthe organization as a whole (Brower etal., 2009, Semerciöz et al., 2010,). Lowemployee trust contributes to furtherorganizational dysfunctions, fromincreased stress, absenteeism and lower

performance to greater turnover and anunwillingness to behave in ways thatcontribute positively to organizationalfunctioning.

Organizational trust is shown as animportant factor in improvement oforganizational commitment and realizationof organizational aims. Trust inorganization probably affects all activitiesof the organization. Existence of a climateof trust in an organization keepsemployees and management together andenables them to trust each other and actopenly. Trust is dynamic in nature andvariety of determinants has been identifiedby researchers. Trust has been found tobe a function of several factors such asorganizational culture (Christensen andLagreid 2005), leadership (Bennis,2002), HR practices like performanceappraisal, feedback on performance,empowerment, open communication etc.(Berg, 2005; Chowdhury, 2005; Kickul,Gundry and Posig, 2005). Inorganizations, trust is normally a two-waystreet. Employees’ trust on employer /organization and employer’s trust inemployees. The present study focuses ontrust from employees’ perspective.

Organizational Commitment

Organizational commitment is needed inmodern business environment as it leadsto high performance and increasedproductivity. Level of efforts to achievethe organizational goal depends upon thelevel of commitment of employees.Committed employees strive to work


beyond the call of their duty(Mohapatra and Sharma, 2010). In thepresent study, Allen and Meyer’s(1990) multidimensional approach oforganizational commitment is used.According to this approach,organizational commitment consists ofaffective, normative and continuancecommitment. Affective commitmentrefers to the emotional attachment withthe organization based on the matchwith the organizational values and goalsto that of the employee’s personalvalues and goals. It is the most desiredform of commitment sought byorganizations. Employees with highlevel of affective commitment possessa strong belief in and acceptance oforganizational goal, objectives andvalues (Mowdey et al., 1979).Normative commitment refers to thesense of obligation and responsibility toremain with the organization.Employees with high normativecommitment believe that they ought tocontinue working for their organizationbecause it the “right and moral” thingto do (Meyer and Allen, 1991; Meyeret al., 2002). Continuance commitmentinvolves a person’s bond with anorganization based on which it wouldcost that person to leave the company.Allen and Meyer (1990) proposed thatcontinuance commitment develops onthe basis of two factors: (1) number ofinvestments (side-bets) individualsmake in their current organization and(2) perceived lack of alternatives.

Trust is related to organizationalcommitment. On a general level,employee trust directly affects employee’scommitment (Ferres, Connell andTravaglione, 2004; Laschinger, Fineganand Shamian, 2001). Trust in managementwas found to be correlated withcommitment (Nyhan, 2000; Ferres et al,2004; Chughtai and Zafar, 2006). Someresearchers have found organizationalcommitment as an outcome of trust (Tanand Tan, 2000; Colquitt et al., 2007).Employees who have trust in the wordsand actions of management of theorganization will most likely enjoyworking in the organization and developattachment with the organization. Whentrust level is high, employees aresupportive of, or committed to authoritiesand the institutions. Above evidencesindicates that employee trust results inoverall organizational commitment. Thusone of the objectives of the study is tofind out the influence of employee truston organizational commitment as a whole.But probably there is no research whichindicates influence of employee trust ondifferent dimensions of organizationalcommitment separately. There is littleempirical research evidence for a directcausal relationship between trust andaffective commitment (Nyhan andMarlowe, 1997). So under the sameobjective, the study intends to see howemployee trust influences threedimensions of organizational commitment(affective, normative and continuancecommitment) separately in the


organizations of the study. In light of thisobjective and above discussions, it ishypothesized that:

H1: Employee trust on employer wouldinfluence positively affective,normative and continuancecommitment as well as organizationalcommitment as a whole.

Innovative Behaviour

In a competitive, uncertain and fastchanging business environment, theconcept of innovation has gainedsignificant importance by corporate. Infact survival and growth of organizationdepends much upon the innovation intheir business models, systems andprocesses, functions, structures etc. Thescope of innovations range from thedevelopment and implementation of newideas that innovate theories, practices, orproducts across the whole organizationto much smaller-scale ideas that arerelated to improvements in daily workprocesses and work designs (Axtel et al.,2000). Innovation is generally consideredto be one of the key drivers oforganizational success (Schillewaert et al.,2005). Innovation can be source ofcompetitive edge for the organizationwhich partly depends upon the innovativebehaviour of employees. Employee is animportant source of idea creation, aprerequisite of innovation. This makesobvious that in order to innovate,organization should have innovativeemployees. Developing the innovativepotential of employees is important, as it

is directly related to organizationaleffectiveness and productivity (Lee,2008).

Innovative behaviour can be describedas an employee’s willingness to seek forbetter ways to improve the level ofproductivity in an organization (Cho andLee, 2007). The notion of innovativebehavior is the same as that of innovativework behavior (IWB) identified inorganizational behavior literature (Janssen2000; Ramamoorthy et al., 2005).Carmeli, Weisberg and Meitar (2006)described innovative behaviour as a multi-staged process, including recognizing aproblem, creating new ideas and solutionsfor the problem, creating support for thenew ideas and solutions for use in theorganization. However, in the presentstudy, Cho and Lee’s (2007)conceptualization of innovative behaviouris taken.

Employee trust is related to innovativebehavior that often accompanies risk-taking behavior (Serva, Fuller and Mayer,2005). A subordinate’s trusts on his/hersupervisor increases work performanceand contributes to make an extra effortto create value for the organization(Mayer and Gavin, 2005). Chenhall andSmith (2003) in their study suggested thattrust in organizations facilitate reaching thegoals either individual or organizational,developing innovative strategies andsharing values, beliefs and knowledgeand also causes effective communicationand participation in problem solving.


Otherwise, subordinates with no trust intheir management will not feel encouragedto make any extra effort, assume extraresponsibility (Pierce and Gardner, 2004;Mayer and Gavin, 2005), an indicationof innovative behaviour. Although analysisof extant literatures on innovativebehaviour reveals that there are very fewresearches available that explain directlythe influence of employee trust onemployees’ innovative behaviour. This isanother reason for the present study.Thus another objective of the study is tofind out that how employee trust onemployer facilitates or influencesemployees’ innovative behaviour in theorganizations. Based on this objective andabove discussions it is conjectured that –

H2: Employee trust on employer wouldpositively influence employee’sinnovative behaviour

METHODOLOGY

Sample and Procedures

The target population of this study was fulltime employees working in the head officeof two public sector organizations (a PowerCompany and a Telecom Company)located in the capital city, Thimphu inBhutan. Data were collected using astandard questionnaire. There were around250 people in the office of the powercompany and around 200 in the telecomcompany. 100 questionnaires (around 25percent of the total employees in the office)were distributed among employees of boththe organizations in 50 – 50 ratio. Only 90

employees returned the filled upquestionnaire and 10 people could notcompleted the questionnaire. Thus thepresent study is based on a total of 90respondents, taken randomly and fromdifferent levels. Respondents wereconsulted in offices during the workinghours with the prior permission from thecompetent authority in both theorganizations. Then they were assured ofconfidentiality of their responses and weretold that their responses shall be used forthe research purpose only. Thequestionnaire was completed in presenceof the researcher. Demographic data werealso taken from respondents.Approximately 29 years are the average ageof respondents which consists of male andfemale both in the ratio of (approximately62 and 38 percent). Majority of therespondents (55 per cent) have graduationand above qualification and the remainingare below graduation. All the necessaryinformation regarding the study and waysto respond on questionnaire is shared withall the respondents.

Questionnaire Selection

Survey was undertaken usingquestionnaire consisting of scales /measures of all three variables of the study.Following scales used in the present studywere not adopted rather used in its originalform.

Measures

Trust in Organization– Employee trusttowards their organization was


measured with 12 - item scale takenfrom Workplace Trust Survey (WTS)developed by Ferres and Travaglione(2003). The WTS is a 36-item scalefor measuring trust from three levels(organizational, immediate manager,co-worker) within an organization. Inthe present paper, only one level (trustin organization) was used. Themeasure is aimed at taping employeetrust in their employer / organization.The reliability of the scale (Trust inOrganization) is 0.95 (alpha), as foundby the developer of the scale. Theresponses were rated on a 5-point scaleranging from 1 (strongly disagree) to 5(strongly agree).

Organizational Commitment –Employee commitment was measuredthrough using Organizational CommitmentQuestionnaire, developed by Allen andMeyer (1996). This scale measurescommitment in three areas namelyaffective, normative and continuancecommitment. There are six items for eachof the three areas, making 18 - item scalein all. Reliability of the scale was 0.87 foraffective, 0.75 for continuance, and 0.79for normative commitment (alphas), asfound by the developer of the scale. Theresponses were rated on a 5-point scaleranging from 1 (strongly disagree) to 5(strongly agree).

Innovative Behaviour – In order tomeasure innovative behaviour ofemployees, scale used by Ishak (2005)in his research, were used in this study.

He developed the scale adapting from thework of George and Zhou (2001). Thescale has 13 items in all. Higher scoresindicated a higher degree ofinnovativeness. Factor loading of thescale ranged from 0.62 to 0.97 andreliability is 0.97 (alpha), as found by thedeveloper of the scale. The responseswere rated on a 5-point scale rangingfrom 1 (strongly disagree) to 5 (stronglyagree).

ANALYSIS AND RESULTS

The data were analyzed with the help ofStatistical Package for Social Sciences(SPSS, Version 12) and correlation andmultiple regression analysis were carriedout. Correlation was used to see howall the variables of interest were relatedto each other. Multiple regressions wereapplied to ascertain how much employeetrust was influencing organizationalcommitment and its three dimensions aswell as innovative behaviour ofemployees in the organizations.

Results presented in the table -1 clearlyreveal that the employee’s trustpositively but not significantly related toorganizational commitment as a whole.But it is significantly and positively relatedto its two dimensions, affectivecommitment (r = .308) and normative(r = 0.384) commitment. Aboveresults also reveal that employee’strust is positively and significantlyrelated to employee’s innovativebehaviour (r = .503).


Table – 1: Mean, Standard Deviation (SD) and correlation coefficient among variables (N= 90)

* Correlation is significant at the 0.05 level (2-tailed).** Correlation is significant at the 0.01 level (2-tailed).

Based on the results of the correlationanalyses, multiple regression analyseswere carried out to determine that howmuch trust predicts organizationalcommitment and its three dimensionsseparately as well as employees’innovative behaviour. The table – 2(below) reveals that trust predictsaffective commitment (â = 0.308; p =0.003) and normative commitment (â =0.384; p = .000) positively andsignificantly. Adjusted R² for affectivecommitment is found to be 0.085, whichindicates that around 8 percent variation

can be explained in affective commitmentby employee trust. Similarly Adjusted R²for normative commitment is found tobe 0.137, which indicates thatapproximately 14 percent variation canbe explained in normative commitmentby employee trust. F values were foundto be significant for both affective (F =9.22, p = 0.003) and normativecommitment (F = 15.18, p = .000).Thus, hypothesis 1, which predicted thatthe employee trust would significantlyexplain variance in organizationalcommitment, was partially supported.


Table – 2: Regression analysis of employee trust in relation to organizational commitment andInnovative behaviour (N = 90)

* Significant at the 0.05 level (2-tailed)* * Significant at the 0.01 level (2-tailed)

Regression analysis also revealed thatemployee trust significantly and positivelypredicts employee’s innovative behaviour(â = .503; p = .000). Thus, hypothesis2, which predicted that employee trustwould significantly and positively explainvariance in innovative behaviour, wassupported.

DISCUSSION

The present study was planned to achievetwo objectives – (1) to find out impact ofemployee trust on organizationalcommitment and its three dimensionsseparately and (2) to find out the impactof employee trust on employee’sinnovative behaviour.

Analysis of the results revealed that trustof employees on employer / organizationhas positive effect on organizationalcommitment. More specifically trustinfluences employee’s affective andnormative commitment in significantmanner. It means that trust play significantrole in the development of two dimensionsof organizational commitment, i.e.affective and normative commitmentwhich is considered as important for theorganization. Employees with affective andnormative commitment try to perform attheir best. The present finding has somesimilarity with the findings of Bagraim andHime (2007) who have reported astatistically significant relationship between


trust and affective commitment.Employees, who believe that employer’sactions and intentions are fair and honesttowards them, feel that they should alsobe honest and sincere towards their workand organizational goal. Perception ofintegrity and honesty of employeestowards their employers leads to thedevelopment of emotional attachmentwith the organizational goal, values etc.Even if organizational goals and values donot match with the employees’ goal andvalues, but if employees find theorganization to be trusting and honest withrespect to employee affairs, probablyemployees try to adjust their goals andvalues in line with the organization’s, thusleading to the development of affectivecommitment. Similarly, when employeefeels that he/she is treated fairly, his/herknowledge, skills and opinions are valuedby organization, information are sharedopenly etc., the employee also develop asense of respect towards theorganizations, and think that for him/herit is morally binding to show commitmenttowards the organization.

Another objective of the present researchis to find the influence of employee truston employee’s innovative behaviour.Results revealed that employee trust onemployer / organization does facilitateinnovative behaviour. Innovativebehaviour goes beyond the familiar pathof what is accepted and concrete and isoften associated with complexity andambiguity (Kriegesmann, Kley andSchwering, 2007). Employees are

unlikely to display innovative behaviourunless they are supported, encouraged toexpress freely, their work is recognizedetc. Further, if an employee makes amistake when displaying innovativebehaviour, it is important that this will notdamage their career or reputationotherwise employees will be tooconcerned about the consequences tothink innovatively or creatively (Janssen,2005). Therefore, the more anorganization rewards and supports (indifferent forms) and listens and trusts ontheir ability, experience, confidence,shows fairness with employees etc., themore employees believe in theiremployer, their character, integrity,honesty etc. and in turn employees showmore innovativeness. In conclusion, it ispivotal that for an organization toencourage and facilitate innovativebehaviour, a culture of trust and supportbe created where mistakes areconsidered as a learning curve. Probablyorganizational/ employer’s trust inemployees works as a motivating forcefor showing innovativeness. Employees’trust on employer / organization enablesemployees to oversee other issues andwork for the betterment of organizationby doing something different or new thanconventional ways.

CONCLUSION

From the above findings and discussionsit can be concluded that employee trustin their employer is important fororganizational commitment especially for


affective and normative commitment andalso to enhance employees’innovativeness. Employee trust towardstheir employer / organization decides tothe greater extent that how employeesthink and behave in their organization.Employees with trust in theirmanagement’s actions and intentions,their policies and practices, develop asense of commitment to their work andorganization and also try their best to beinnovative in their job which in turn helpsto increase overall productivity andefficiency in the organizations.

Implications

This study has made both practical andtheoretical contributions. For HumanResource Managers of the organizations,the study provides insight that iforganizations or organizational agentsattempt to foster trust in their employeesthrough their policies and practices, it willpositively affect the effectiveness ofhuman resource practices. It will fostera sense of commitment especiallyaffective and normative commitmentamong employees. It will also enableemployees to be innovative, more willingto come out and share innovative ideasin their work life. Fostering trust inemployees should become a managerialimperative as it results in valuedorganizational outcomes. Organizationcan use trusting relationship as one of thetools or strategies for developingemotional attachment with theirorganization and motivating employees to

utilize their innovative potential for thegood of the organizations. Theoretically,it enriched the literature of employee trustand some of the consequences fromBhutanese perspective.

LIMITATIONS OF THE STUDY

Interpretation of findings of this studyshould bear certain limitations in mind.Use of small sample size, one location andonly two public sector organizations mayaffect its ability to generalize on the wholepopulation.. The use of self-reportedsurvey data is another limitation, whichmay be affected by response biases. Theresearch design in this study was crosssectional which means results reflect thespecific point of time. A longitudinalresearch may give a better understandingof the issue and may highlight strongerassociations with commitment andinnovative behaviour. Another limitationis that scales used in the present researchare not adopted for the present contextrather used in its original form asnationality and cultural differences mightmoderate trust relationships (Banai andReisel, 1999; Park, Gowan and Hwang,2002).

SCOPE FOR FUTURE RESEARCH

Limitations identified in this study, provideopportunities for further research.Limitations identified suggest a need toreplicate this study with wider samplecovering different geographical locations.It is also suggested that the study shouldcover employees of other public sector


organizations in the country. The authorwould also like to suggest that the issuebe explored in longitudinal researchdesign. It is also suggested that adoptedscales should be used for further research.Research based on theserecommendations may help to have moreuseful insights on the issue and it may helpin strengthening and / or improvingmanagement policies and practices.

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An Empirical Study of EmployeeEmpowerment and Information Sharing in

Manufacturing and Service SectorOrganizations in Mumbai & Pune

Dr. Shaju George,Head of Department of Business & Assistant Professor

Royal University for Women, Kingdom of BahrainPO Box 37400, Riffa, Kingdom of Bahrain

E mail: [email protected]

Abstract

Empowerment is increasingly used in various organizations in adynamic world of business. Empowerment is seen as an effective techniqueof managing the operations of the organization. While the degree ofempowerment can vary from organization to organization, the importanceof empowering employees has been generally accepted. Empowerment iscritical in a world characterized by innovation and an ever increasingneed of responding to the fast changing external and internalenvironment. Empowered employees can be a source of sustainableCompetitive Advantage both in the Service sector and Manufacturingsector organizations. This study focuses on the various dimensions whichlead to empowerment in an organization and also the role of informationsharing in empowering employees. This study aims to find the level ofempowerment in service sector and the manufacturing sectororganizations. It also attempts to find the correlation betweenempowerment and information. The questionnaire was administered to281 employees of 8 companies belonging to manufacturing and servicesector organizations of Mumbai & Pune. The findings of the study indicatethat the manufacturing sector employees are more empowered than theservice sector employees. It also indicates that there is a positivecorrelation between empowerment and information sharing.

Keywords: Empowerment, Information sharing, meaning, Competence, Self-determination, Impact.

An Empirical Study of Employee Empowerment and Information Sharing in Manufacturing and Service Sector Organizations in Mumbai & Pune


Introduction

Empowerment is the authority to takedecisions independently, concerningone’s own area of work. WhileEmpowerment is always believed to bea process where the power flows froma superior to a subordinate, it cannot beconcluded as a one to one activity or aunilateral action of a superior. It may notbe left to individual managers. IfEmpowerment is required to beeffectively implemented then it requiresorganizational commitment,administrative will and an appropriatepolicy. It is important to educatemanagers at all levels and all thesubordinate employees across theorganization. Empowerment is theprocess where employees are not justdelegated the work but also given theauthority and responsibility to performwork effectively. Employees are alsogiven the resources required to performtheir jobs. Hence what differentiatesmere delegation of work fromempowerment is that empoweredemployees are given authority,responsibility and resources on a routinebasis, to perform their job effectively.In an empowered environment,employees are free to correct problemswithout the fear of reprisal orinterference from the managers. Theunderlying assumption is that theemployees have the necessary skills,understanding and the capability toperform their job without muchsupervision.

Many companies have embarked onvarious types of empowerment programsto improve results, yet the success ofthese programs has been mixed at best.One of the reasons for the mixed resultsis that empowerment often meansdifferent things to different people.(Hughes, Ginnett & Curphy, 2009)

Quinn & Spreitzer (1997) suggests thatthere are two schools of thought, onebeing, empowerment is about delegationand accountability, a top-down processwhere senior leaders articulate a visionand specific goals, and hold followersresponsible for achieving them. Whereasothers believe that empowerment is moreof a bottom-up approach that focuses onintelligent risk taking, growth, change,trust and ownership; followers act asentrepreneurs and owners who questionrules and make intelligent decisions.Leaders tolerate mistakes and encouragecooperative behavior in this approach toempowerment. These conceptualizationsof empowerment have very differentimplications for leaders and followers.This confusing conceptualization ofempowerment is the very reason forempowerment initiatives to fail.

Greenberg (2011) states that an importanttrend has been occurring in organizationsthese days: power is shifting downward.Top Managers are now granting more andmore power to lower-level managers andsupervisors are putting power into thehands of employees themselves. Ford &Fottler (1995) argues that empowerment

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is a matter of degree rather than anabsolute. Some employees or teams maybe more empowered than others in thesame organizations. Mullins (2010)argues that trust and confidence insubordinates, manager’s ownperformance and also system ofdelegation contributes to empowermentand is a key ingredient of effectivemanagement.

Review of Literature

Employee Empowerment Defined

Hughes, Ginnett & Curphy (2009)define empowerment as having twocomponents. First, for leaders to trulyempower employees they mustdelegate leadership and decisionmaking down to the lowest levelpossible and the second component isto equip followers with the resources,knowledge and skills necessary to makegood decisions.

Spreitzer (1995) defines psychologicalempowerment as a motivational constructmanifested in four cognitions: meaning,competence, self-determination, andimpact. Together, these four cognitions ormicro components reflect an activeorientation to a work role, in which anindividual wishes and feels able to shapehis or her work role and context. Thesefour dimensions combine additively tocreate an overall construct ofpsychological empowerment. These fourdimensions of empowerment areexplained below.

Meaning: Meaning is the value of a workgoal or purpose which an employeeassociates to his work, judged in relationto an individual’s own ideal or standards(Thomas & Velthouse, 1990).

Competence: Competence or self-efficacy is an individual’s belief in his orher capability to perform activities withskill (Gist, 1987).

Self-determination: Self -determination isan individual’s sense of having choice ininitiating and regulating actions (Deci,Connell, & Ryan, 1989)

Impact: Impact is the degree to which anindividual can influence strategic,Administrative or operating outcomes atwork (Ashforth, 1989)

Erstad (1997) describes empowermentas a change strategy with the dual aim ofimproving the individual’s and theorganizations ability to take actions. Healso agrees that empowerment is acomplex process which requires a clearvision, conducive learning environmentand participation and implementationtools and techniques. Atchison (1991)defines empowerment as givingemployees both responsibilities andauthority to make decisions pertaining toall aspects of their work, including productdevelopment or customer service. Theemployees are then held accountable forthe product or services they produce. Inturn the employees are compensated bysharing the resulting profits or losses ofthe company. Randolph & Sashkin



(2002) also states that empowerment isthe process of giving all the employees,the authority to make decisions and tobe responsible for their outcomes. Self-managed teams are good examples ofempowered employees who are given theresponsibility of leading their own teamsand ensuring that they achieve the desiredgoals and objectives.

Employee EmpowermentPerspectives

Hughes, Ginnett & Curphy (2009) arguesthat, although the motivational benefits ofempowerment can be debated, there isno doubt that empowerment leads tolearning and stress reduction. Properlydesigned and implemented empowermentprograms helps employees to learn moreabout their jobs, company and industry.This collective knowledge and skill ofemployees can improve the intellectualcapital of the company and can be acompetitive advantage for theorganization. Empowerment has fourmicro components which determines, towhat extent or degree are employeesempowered in an organizational context(Quinn & Spreitzer,1997; Spreitzer,1995). These micro components areMeaning, Competence, Self-determination and Impact. Hughes,Ginnett & Curphy (2009) suggest six bestpractices of empowerment. Do we reallywant or need empowerment? Creating aclear vision, goal and accountabilities,Developing others, Delegating decisionmaking to followers, Leading by example

and Empowerment must be systematic tobe successful. Greenberg (2011)emphasizes that when employees areempowered, their supervisors are morelikely to be like teachers or facilitatorswho guide their work groups by usingtheir knowledge and experience and notlike bosses who use coercive power topush people around. Mullins (2010)emphasizes that the empowermentfacilitates the removal of constraints andgrants autonomy to employees for takingindependent actions without having toconsult their supervisors. Atchison (1991)states that the purpose of empowermentis not just listening to employees or givingthem a feeling of participation but alsoallowing employees to make decisions intheir own areas of work and truly sharingthe power in the organization. Johnson,Scholes & Whittington (2011) argues thatinstead of having only a top-downapproach to empowerment, the only wayto truly empower employees, is to acceptresponsibility at every level in terms ofbringing in fresh ideas, for innovation andalso for managing change. This wouldnaturally call for more employeeparticipation in an effort to bring aboutchange. Noe, Hollenbeck, Gerhart &Wright (2009) states that apart from otherfactors, the success of employeeempowerment will also depend on soundHR practices like performancemanagement, training, work design andappropriate compensation. Empoweredemployees will also require timelyfeedback to evaluate their work.

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Empowered employees are able toachieve best results if they are fullyengaged in their work. With the everincreasing need of knowledge workers,employee empowerment leads to achange in focus from technical skills togeneral cognitive and interpersonal skills.George & Jones (2008) argues thatmanagers and other employees of theorganization need to change the way theythink about decision making in order tocreate empowered employees. One ofthe essentials of empowerment is tospread the responsibility of decisionmaking among all the employees of theorganization. Hughes, Ginnett & Curphy(2009) argues that, although themotivational benefits of empowermentcan be debated, there is no doubt thatempowerment leads to learning and stressreduction. Properly designed andimplemented empowerment programshelps employees to learn more about theirjobs, company and industry. Thiscollective knowledge and skill ofemployees can improve the intellectualcapital of the company and can be acompetitive advantage for theorganization. Johnson, Scholes &Whittington (2011) argues that thoughlower level empowered employees cantake initiatives and can experiment at theirend, in the long run this may lead toincoherence.

Anonymous (1991) argues that though itmay be difficult to achieve, this change inthinking about decision making will bringabout the desired results and truly

empower employees. Many companiesuse empowerment to improve their groupdecision like McDonald’s, FederalExpress, Citibank & Xerox. Gabor(1991) states that Xerox has gone to theextent of even insisting on suppliers to useempowerment and other Total QualityManagement practices to improve thequality of parts Xerox from them becauseof a firm belief that empowerment andsharing decision making authority canbring about improvement in the quality.

Mullins (2010) emphasizes that theempowerment facilitates the removal ofconstraints and grants autonomy toemployees for taking independent actionswithout having to consult their supervisors.However, it is in favor of some form ofmanagerial control irrespective of thedegree of empowerment prevalent in theorganization.

The role of Information sharing inEmployee Empowerment

Information sharing is very critical tomeaningful empowerment. Theinformation, not only about all the aspectsof his work but also regarding the productor services provided by the company isimportant. The information andunderstanding regarding the Vision,Mission, objectives and business strategywill go a long way in contributing to realempowerment of employees. All theattempts and efforts of a company toempower employees without sharinginformation with them will prove to befutile.



Noe, Hollenbeck, Gerhart & Wright(2009) argues that for empowerment tobe more effective and successful, themanagers also need to be trained to linkcompany’s internal and external resourceslike the customers, their counterparts inother departments and units, relevantwebsites etc for the required information.Further, managers must also encourageinter-departmental interaction and makesure that they receive the necessaryinformation. Cakar et al. (2010) arguesthat for employees to achieve greaterempowerment, they will require relevantinformation along with feedback fromtheir superiors. Managers can intrinsicallymotivating employees by praise and givingtimely information regarding theirperformance. It is further emphasized thatInformation sharing must be stimulatedbecause it is one of the most importanttools of creativity Ahmed (1998)emphasizes that information sharingcontributes to empowerment to a largeextent. Baird et al. (2010) states that inan ever changing business environment,it is of profound importance to changerapidly as per the demands of thechanging environment. Under such acompelling circumstance to changerapidly, it is all the more important toempower employees at every level of theorganization which will facilitate theelimination of extensive upward anddownward communication in theorganizational hierarchy. As lower levelemployees have more information aboutthe day to day operations of the

organization, it is sensible to shareinformation at every level of theorganization. This can help theorganization to be more dynamic andrespond faster to a given situation.Further a strong association has beenidentified between empowerment andinformation sharing.

Objectives of the Study:

1. To evaluate the level ofEmpowerment in service sectorand the manufacturing sectororganization.

2. To study the relationship betweenEmpowerment and organizationalstructure.

3. To study the role of Informationsharing in the process ofempowerment.

4. To study the relationship betweenEmpowerment and Informationsharing.

Hypothesis of the study:

1. The level of Empowerment differsbetween manufacturing andservice sector organizations.

2. Information sharing is directlyrelated to Empowerment.

3. The multifaceted component ofEmpowerment such as Meaning,Impact, Competence, selfDetermination and overallEmpowerment differs betweendifferent levels of structure.

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Methodology

Tools of data collection:

Empowerment Scale:

Spreitzer (1995) defines empowermentas increased intrinsic task motivation in aset of four cognitions reflecting anindividual’s orientation to his work role:Meaning, Competence, Self-determination and Impact.

Spreitzer (1995) EmployeeEmpowerment scale contains fourdimensions: Meaning, Competence, SelfDetermination and Impact. The scale isfive point Likert Type. Every dimensionhas five point response categories. A fivepoint rating scale that ranged from 1 (verylow) to 5 (very high) was used. The higherthe score more empowerment and lowerthe scores less empowerment.

Reliability of the Scale: The CronbachAlpha Reliability coefficient for the overallempowerment construct was .72 for theindustrial sample.

Information sharing Scale:

An information sharing scale wasspecially developed covering four factors,i.e. availability of information, theorganizational performance,encouragement and practice of theorganization. The information sharingscale is a five point Likert type scale. Afive point rating scale that ranged from 1(very low) to 5 (very high) was used withthe statements. Higher the score, more is

the information sharing and lesser thescore, less is the information sharing.

Units and sample for the study(Primary Data):

The data was collected from 4organizations of manufacturing sector and4 organizations of the service sector.These organizations are from Mumbai andPune in India. The sample constituteslower, middle and higher level managerscovering 141 samples from manufacturingsector and 140 samples from servicesector. The sample constituted 10% ofthe universe of the sample in each unit.The samples were identified on the basisof convenience.

Design of Research and StatisticalAnalysis:

2 x 3 factorial design was used to analyzethe data, 2 represents the two sectors i.e.Service and Manufacturing sectors. 3represents the three levels of managementi.e. lower, Middle and Higher levelmanagers. 1%, 5% & 10% level ofsignificance has been considered.

Data Analysis and Interpretation:

Table 1 is the ANOVA related tomeaning Dimension of Empowerment.The obtained ‘F’ value at the structurelevel (Lower level, Middle Level andHigher Level) is 2.915 which is significant.At the sector level and the interaction levelthe obtained ‘F’ value is .055 and .802respectively which is not significant. Itindicates that the Meaning Dimension of



empowerment is largely dependent onstructure than on sector.

Table 2 relates to Mean & StandardDeviation of Meaning Dimension ofEmpowerment. There are three level ofStructure i.e. Lower Level, Middle Leveland Higher Level. It shows a comparisonof Mean between Manufacturing andService Sector. In the ManufacturingSector the mean of Lower Level is11.706, Middle level is 12.072 andHigher Level is 11.964.This indicates thatthe value of a work goal or purpose,judged in relations to an individual’s ownideals or standards is demonstrated morein case of middle level employees thanthe lower level employees and HigherLevel employees. Similarly the workgoals and objectives of the organizationsare more meaningful to the employees ofHigher Level than the Lower Levelemployees of the Manufacturing Sector.In the Service Sector the Mean of LowerLevel, Middle Level and Higher Levelis 11.400, 11.886 and 12.681respectively. It is noticed that the valueof goals and objectives of theorganization for the employees are moredemonstrated as the Level of Structureincreases i.e. Middle Level employeesdemonstrate more value for the goalsand objectives of the organization thanthe Lower level employees. Similarlythe Higher Level Employeesdemonstrates a greater degree of valuefor the organizational goals andobjectives than the i.e. Lower Level,Middle Level employees.

Table 3 is the ANOVA related to theImpact Dimension of empowerment. Theobtained ‘F’ value at the structure level is1.221, which is not significant; however atthe sector level the ‘F’ value is 1.376 whichis significant at 5% level of confidence. Itmeans that the Impact Dimension ofEmpowerment differs betweenmanufacturing and service sector.

Table 4 indicates sector wise analysis ofImpact Dimension of Empowerment.This tabulation is carried in order to furtherinvestigate which sector has got moreinfluence on the Impact Dimension ofEmpowerment. Mean value of servicesector is 11.092 and manufacturing sectoris 11.801. The standard deviation ofmanufacturing and service sector is 2.600and 2.608 respectively. It is found thatthe employees of the Manufacturingsector influence strategic, administrativeor operating outcomes more than theircounter parts in the Service sector.

Table 5 is the ANOVA related to SelfDetermination Dimension ofEmpowerment. The obtained ‘F’ valueat the structure level is 2.900, which issignificant. This means that the self-determination dimension of empowermentdiffers between Manufacturing andService Sector. At the sector level theobtained ‘F’ value is 2.033 which is notsignificant. At two way interaction theobtained ‘F’ value is .117 which is alsonot significant.

Table 6 indicates Sector wise analysisof Self Determination Dimension of

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Empowerment. The Mean Value ofManufacturing Sector is 12.014 and theService Sector is 11.542. It indicates thatthe employees of the ManufacturingSector are more involved in their ownwork and they want to make sure thattheir individual performances and theircontribution to the organization ismaximized. The individual sense ofhaving choice in initiating and regulatingactions are found to be more inManufacturing Sector the Service SectorOrganization.

Table 7 is the ANOVA pertaining toEmpowerment. The Hypothesis to betested is “The level of Empowermentdiffers between Manufacturing andService Sector Organizations”. TheHypotheses is accepted on the basis ofthe obtained significance of ‘F’ valuebetween Manufacturing and Servicesector organizations. It shows thatempowerment differs betweenManufacturing and Service Sector.Another Hypothesis tested is “TheMultifaceted component ofEmpowerment such as Meaning,Impact, Competence, Self-determination and overallEmpowerment differs betweendifferent levels of structure”. At thestructure level the obtained ̀ F’ value is1.830, which is not significant. Theobtained ̀ F’ value at the sector level is2.039 which is significant a 10% levelof confidence. This indicates thatempowerment depends largely on sectorthan on structure.

Table 8 indicates Sector-wise Analysisof Empowerment. The mean value ofManufacturing Sector 48.056 andService Sector is 46.264. Thisindicates that the employees ofManufacturing Sector have got moreauthority to do their jobs without anydirection or intervention from theirsuperiors. They are capable of takingdecisions regarding any matterconcerning their own work. It alsoindicates that the employees ofManufacturing Sector have more senseof value for their own ideals orstandards and they also influence theactivities of the organization. Theemployees believe firmly on theircapability to perform their work. Theemployees of manufacturing Sectorhave a greater sense of choice ininitiating and regulating actions.

Table 9 indicates ANOVA related toInformation sharing. The obtained ‘F’value at the structure level is 2.452, itis significant. This shows thatInformation sharing differs betweendifferent structures of the organizations.The result of table indicates thatInformation depends more on structurethan on sector.

Table 10 indicates sector-wise analysisof Information sharing . In themanufacturing Sector the Mean is13.465, 13.690 and 14.428 for LowerLevel, Higher Level and Middle Levelemployees respectively. It clearlyindicates that Lower Level employees



have lesser availability of informationthan Middle Level Employees andHigher Level Employees. Similarly itis also noticed that the availability ofinformation is more with the HigherLevel Employees than the Lower levelemployees and the Middle LevelEmployees. It clearly indicates that theavailability of information goes onincreasing with every increase in thelevel of structure.

Table 11 indicates the co-relationbetween all the dimensions ofEmpowerment. The correlation valuessuggest that there is a direct relationshipbetween all the dimensions ofEmpowerment.

Table 12 indicates that the co-relationvalue is .399 which proves that there is adirect relationship between informationsharing and Empowerment. TheHypothesis tested is “Informationsharing is directly related toEmpowerment”. The Hypothesis isaccepted on the grounds of the obtained‘P’ value, which is significant at 1% levelof confidence and the co-relation value.

Research Findings and TheoreticalImplications:

Empowerment is a multifacetedconcept encompassing 4 maindimensions or micro components i.e.‘Meaning’, ‘Competence’, ‘Self-determination’ and ‘Impact’. These 4main dimensions together contribute tooverall employee empowerment.

Empowerment depends largely onsector than on the structure of anorganization. There is a clear differencein the degree of empowerment inmanufacturing and that of in the servicesector organization.

The employees of manufacturing sectorare more empowered than theircounterparts in the service sectororganizations. The employees ofemployees of the manufacturing sectorhave got more authority to do their jobswithout any intervention from theirsuperiors. The employees ofmanufacturing sector have a greatersense of choice in initiating andregulating work related activities.

Information sharing is directly relatedto Empowerment. This indicates thatemployees having more access toinformation will be more empowered.

The employees of the higher level havemore access to information than thoseat the lower level.

REFERENCES

Ahmed, P. (1998) Culture and Climatefor Innovation.European Journal ofInnovation Management.vol 1.no.1, pp. 30-43.

Anonymous, (1991) How Does ServiceDrive The Service Company?Harvard Business Review, volNov- Dec, pp. 146-158.

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Ashforth, B.E. (1989) The experience ofpowerlessness in organizations.Organizational Behavior.Organizational Behavior andHuman Decision Processes, vol43, pp. 207- 242.

Atchison, T.J (1991). The EmploymentRelationship: Untied or Re-Tied,Academy of ManagementExecutive, vol 5, pp. 52-62.

Baird, Kevin, Wang & Haiyin (2010)Employee Empowerment: extent ofadoption and influential factors.Personnel Review, vol 39 no.5. pp.574-599.

Cakar, Demircan N, Erturk & Alper(2010) Comparing InnovationCapability of Small and Medium-Sized Enterprises: Examining theEffects of Organizational Cultureand Empowerment. Journal ofSmall Business Management. Vol48 no.3, pp 325-359.

Deci, E.L., Connell, J.P., & Ryan, R.M.(1989) Self –determination in awork organization. Journal ofApplied Psychology, vol 74, pp.580-590.

Erstad, M. (1997). Empowerment andOrganizational Change,International Journal ofContemporary HospitalityManagement, vol 9, no 7, pp.325-333.

Ford, R.C., & Fottler, M.D. (1995).Empowerment: A matter of degree.Academy of ManagementExecutive, vol 9, pp. 21-29.

Gabor, A. (1991) Rochester Focuses: ACommunity’s Core Competencies.Harvard Business Review, vol Jul-Aug, pp. 116-126.

George, J.M., & Jones, G.R. (2008)Understanding and ManagingOrganizational Behaviour. UpperSaddle River, New Jersey: PearsonPrentice Hall.

Gist, M. (1987) Self-efficacy:Implications for organizationalbehavior and human resourcemanagement. Academy ofManagement Review, vol 12, pp.472-485.

Greenberg, J (2011). Behavior inOrganizations. Harlow, England:Pearson.

Hughes, R.L., Ginnett, R.C., Curphy, G.J.(2009). Leadership: Enhancing theLessons of Experience. New York:McGraw Hill.

Johnson, G., Scholes, K., & Whittington,R. (2011). Exploring CorporateStrategy: Text & Cases. Harlow,England: Financial Times PrenticeHall.

Mullins, L.J. (2010), Management &Organizational Behaviour. Harlow,England: Financial Times PrenticeHall.



Noe, R.A., Hollenbeck, J.R., Gerhart,B., & Wright, P.M. (2009).Fundamentals of Human ResourceManagement. New York: McGrawHill.

Quinn, R.E., & Spreitzer, G.M.(1997)The Road to Empowerment: SevenQuestions Every Leader ShouldConsider. OrganizationalDynamics, vol 26 no 2, pp. 37-49.

Randolph, W.A., & Sashkin, M. (2002)Can Organizational EmpowermentWork in Multinational Settings?Academy of Management Review,vol 16, pp. 102-116.

Spreitzer, G.M. (1995) PsychologicalEmpowerment in the Workplace:Dimensions, Measurement, andValidation. Academy ofManagement Journal, vol 38, no 5,pp. 1442-1465.

Thomas, K.W., & Velthouse, B.A.(1990) Cognitive Elements ofEmpowerment. Academy ofManagement Review, vol 15, pp.666-681.

TABLE - 1 ANOVA RELATED TO MEANING DIMENSION OF EMPOWERMENT

TABLE - 2 STRUCTUREWISE ANALYSIS OF MEANING:

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TABLE - 3 ANOVA RELATED TO IMPACT DIMENSION OF EMPOWERMENT

TABLE - 4 SECTORWISE ANALYSIS OF IMPACT

TABLE- 5 ANOVA RELATED TO SELF DETERMINATION DIMENSION OFEMPOWERMENT

TABLE - 6 SECTORWISE ANALYSIS OF SELF DETERMINATION



TABLE - 7 ANOVA RELATED TO EMPOWERMENT

* P< 0.10

TABLE - 8 SECTORWISE ANALYSIS OF EMPOWERMENT

TABLE - 9 ANNOVA RELATED TO INFORMATION SHARING

* P< 0.10

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TABLE - 10 STRUCTUREWISE ANALYSIS OF INFORMATION SHARING

* P < 0, # P < 0.05

TABLE - 11 CO-RELATION BETWEEN ALL THE DIMENSIONS OF EMPOWERMENT

TABLE - 12 CO-RELATION BETWEEN INFORMATION SHARING & EMPOWERMENT

* P < 0, # P < 0.05



A critical analysis of the Role, Importance andImplications of Case Study Method of

Teaching for MBA students at KIIT School ofManagement

Ansuman JenaDoctoral Research Scholar

School of Management, KIIT University, Bhubaneswar, Orissa, India, [email protected]; Mobile: (+91) 9040209907

Biswajit DasAssociate Professor and Chairperson Doctoral Programme


Prakash Kumar PradhanDoctoral Research Scholar


Abstract

The case method is recognized as a powerful technique fordelivering management education and obtaining hands-on experienceof organizations. Case studies are extensively used in the business schoolsaround the world to provide intellectual gearing, linking theory andpractical, contributing to a wider debate as well as offering a holisticknowledge of a particular subject.

This research focuses to find out the effectiveness of case studymethod of teaching for MBA students of KSoM. It also aims to criticallyanalyze the students’ perception about case study method of teaching.The findings of this research have enormous implications for themanagement and all the teaching members.

Keywords: Management Education, Methods of Teaching, CaseDiscussions, Students’ perception.

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1. INTRODUCTION

Case study refers to the collection andpresentation of detailed informationabout a particular participant or a smallgroup, frequently including the accountsof subjects themselves (Jain A. K.,2005). A case study is a puzzle that hasto be solved. The case portrays specificproblems for the readers to identify,discuss, analyze and to propose solutionsthrough making rational decisions. Agood case is more than just adescription; it’s more like a detectivestory where the author has presentsspecific facts about a certain situation ina very interesting manner (Dooley &Skinner, 1977).

The main aim of introducing this methodof teaching in various disciplines ofacademics is to acquaint the student into the day to day happenings of therecent world. This method generallygives a competitive approach to thestudents. Basically, in the stream ofmanagement education this method ofteaching has popularized largely.Generally, it is found that those teacherswho use this method of teaching havegot high degree of enthusiasm among thepupils, the reason behind that is it givesthe real life situation of an event orincedent.

There are also many difficulties in casestudy based teaching as the validity ofthe case study approach is directlyrelated to the reality which the casesdemonstrate.

2. LITERATURE REVIEW

Case study method of teaching has madeeducation universal and ubiquitous,basically in the stream of Management(Jain A. K., 2005). This method of teachinghas been applied in various disciplines ofacademics as an alternative to thetraditional education as an instructionalmethod (Artan, 2007; Garvey, O’Sullivan& Blake, 2000; Marcus, Taylor, & Ellis,2004; Williams, 2004).

This instructional method is prevalent forteaching and learning in a Business schoolcontext in particular. Instructors usebusiness cases as the foundation of theirteaching across the curriculum (Magjuka,Liu, & Lee, 2006).

Case study method of teaching has beendescribed as a way of teaching that givesa real life situation of an event which hasoccurred in the business, where a traineefind the details about the situation,strategy, organization, etc. This methodof teaching highly improves the trainee’sproblem solving ability. In this method ofteaching the trainee has to considerdifferent areas of the case that has greatlyimpacted the situation.

This definition echoes the idea that case-based learning can help students prepareto deal with the real-world problems theycould face after leaving an academicenvironment and ultimately, to findsuccess within a specific businessorganization or profession by using thesepreviously learned skills and experiences.

A critical analysis of the Role, Importance and Implications of Case Study Method of Teaching for MBA students at KIIT School of Management


The key to case-based learning is tocreate cases for educational purposesand to facilitate activities associated withcases. Cases are like stories to read andexplore interactively. Cases directstudents towards certain contexts todiscuss and debate issues dynamically.

Williams (2004) summarizes the benefitsof cases used for teaching and learning,stating that it allows learners to:

� Apply theoretical knowledge toreal school contexts.

� Analyze critically about complexsituations and recommend coursesof actions.

� Develop self knowledge base andrecognize own assumptions.

� Compare, debate and evaluateown and others’ perspectives.

� Develop the practice of reflection(p. 20)

The practical application of skills andknowledge learned in a Business schoolis a key consideration for MBA studentsas well as their instructors and theprogramme designers. As a result,graduate business education has reliedupon case-based learning. ManyBusiness schools have adopted the case-based learning approach as a centralteaching and learning method. Thefeatures of case-based learning are to(e.g., applicability, contexts, etc.) fulfill theeducational objectives that MBA

students pursue. Students are promptedto integrate their prior experiences toanalyze cases and to explore solutionsthrough discussion, reflection, anddecision making (Wang & Bonk, 2001).

Case studies allow students to developtheir critical and analytical reasoning skillsand problem-solving processes (Merseth,1999). Cases that present real orhypothetical problems can prompt deepdiscussions, which assist students indeveloping solutions (Benbunan-Fich &Hiltz, 1999).

3. RESEARCH OBJECTIVES

There are two specific objectives forcarrying out this study.

� To find out the effectiveness ofcase study method of teaching inKSoM.

� To find out the students’ perceptionabout case study method ofteaching.

4. RESEARCH HYPOTHESES

Hypothesis - 1: There is no differencebetween the male andfemale students withrespect to the methodsof case analysis.

Hypothesis - 2: There is no relationbetween the numbersof cases discussed in theclass with the studentsunderstanding of theparticular subject.

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Hypothesis - 3: There is no impact ofcase discussion on thedevelopment ofstudents’ analytical,problem solving anddecision making skills.

Hypothesis - 4: There is no differencebetween the students’e d u c a t i o n a lbackground and theirliked method ofteaching.

Hypothesis - 5: There is no differencebetween the impact ofcase discussions withreal business situationand the impact of casediscussions with theunderstanding of theparticular subjectamong the students.

5. RESEARCH METHODOLOGY

5.1 Type of Research

The research was carried out in the monthof February-April, 2011. The populationinvolves all MBA (both 1st year and 2nd

year) students of KIIT School ofManagement. The sample size was 51considering the time constraints. Here adescriptive research technique has beenadopted because through this research aneffort has been made to generate specificinformation about the students’perception, as well as, the effectivenessof case method of teaching at KIITSchool of Management.

5.2 Sampling Technique

It was very difficult to collect data fromall the students of KSOM, whichconstitutes our universe. For this studystratified random sampling technique isused. Stratified sampling is a probabilitysampling procedure in which simplerandom sub samples are drawn fromdifferent strata that are more or lessequal on some characteristics. Thismethod was selected because thepopulation (all MBA students ofKSOM) is divided into differentsections, where each section could beconsidered as a ‘stratum’. From eachsection (total 8 sections) we haverandomly chosen 6 respondents wererandomly chosen. The stratified methodof sampling was chosen because itassures the representation of all groupsin the sample and because thecharacteristics of each stratum can beestimated and compared as they are thetrue representatives of the entirepopulation.

5.3 Sample Design

� Population – All MBA students ofKSoM in 2011.

� Sample size – 51

� Sample – 6 from each section ofMBA-I and MBA-II and 3research scholars.

� Sampling technique – Stratifiedrandom sampling method



6. DATA COLLECTION

6.1 Instrumentation Technique

For the collection of data, a wellstructured, self explanatory questionnairewas used and thus responses werecollected and analyzed subsequently.

6.2 Collection of Responses

For the data collection both the primaryand the secondary sources were used.For collecting data from the primarysources we have used the followingmethod and tools were employed:

1. Direct interaction and interviewwith the respondents.

2. Questionnaire circulation.

To collect data from the secondarysource we have used the followingmethods were used:

1. Publications (Research Journals,Magazines and Periodicals)

2. Internet Sources (Search engines,Ebesco, Proquest and Emerald)

6.3 Method of Data Analysis

SPSS version-19.0 was used for the dataanalysis.

7. DATA ANALYSIS

7.1 Age distribution

Out of the total respondents, 27respondents fall into the age group of 20-23 years, which is 52.9% of the total

respondents. Likewise, 19 respondentsfall into the age group of >23-25 yearsand 5 respondents fall into the age groupof >25-28 years which is 37.3% and9.8% of the total sample respectively.

7.2 Gender distribution

Out of the total respondents, 33respondents were male and 18 werefemale, which was 64.7% and 35.3% ofthe total respondents respectively.

7.3 Educational background

Out of the total respondents, 21 aregraduates (B.Sc./B.A./B.Com. etc), 17have completed their Bachelor Degree inTechnical courses like B. Tech., B. Arch.,Bio-Tech., etc. 7 respondents havecompleted Post Graduation / MastersDegree courses and 6 respondents havecompleted other professional courses likeHotel Management and B.B.A, etc.

7.4 Effectiveness of case studymethod of teaching on subjectunderstanding

Out of the 51 respondents, 10respondents strongly agreed that casestudy method of teaching helps inunderstanding a particular subject matter.Likewise, 37 respondents agreed to thesame proposition. 4 respondents werenot able to say anything. Hence around91.1% of the total respondents eitheragree or strongly agree that case studymethod benefits in understanding asubject.

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7.5 Relevance of the cases with thesubject

Out of the 51 respondents, 10respondents strongly agreed that casesdiscussed in the class were relevant tothe subject. 36 respondents which were70.6% of total respondents agreed to therelevance of cases with the subject andrest 5 respondents (9.9% of the totalsample) either can’t say, disagreed orstrongly disagreed to the relevancy ofcases with respect to subjects taught inthe class room.

7.6 Preferred method of caseanalysis

It was found that around 56.9% of thetotal respondents preferred the open /interactive method of case discussion;where as 37.3% of the total respondentsliked the group discussion method andonly 5.9% out of the total respondentsliked to analyze the cases individually.

7.7 Subject wise liking of cases

To determine the ranks allocated to eachof the subjects as per the likings of therespondents; the principle of ‘low sum ofthe overall ranking is equal to high rankof the subject concern’ was followed.Thus Rank 1 was considered to be thehighest and the most liked case subjectwhere as Rank 9 was considered to bethe least liked case subject. Hence,following the same rule it was found outthat Marketing was the most liked casesubject securing Rank 1 and

Communication was the least liked casesubject securing Rank 9. Rest HRM,Finance, OB, Economics, GeneralManagement and IT has obtained Rank2, 3, 4, 5, 6, 7 and 8 respectively.

7.8 Relevance with real businesssituations

It was found that 82.4% of the totalstudents either strongly agreed or agreedthat cases discussed in the classes bringreal business situation to them. Only17.6% out of the total respondents werenot in favor of it.

7.9 Frequency of case discussions

It was observed that 7 respondents(13.7%) said cases were frequentlydiscussed in their class. 17 respondents(33.3%), 18 respondents (35.3%), 8respondents (15.7%) and only 1 respondent(2%) out of the total students said caseswere quite often , often, rarely and neverdiscussed in their classes respectively.

7.10 Relevance of case discussionswith real business situations

After a case discussion in the class,17.6% students were completely able torelate the case scenario with real businesssituation. 64.7% students were somewhatable to relate, whereas 13.7% to a littleand 3.9% to some extent were able torelate the case with business scenario. Allthe students were more or less able tocorrelate the case scenario with realbusiness situation. None of the studentshave failed to correlate both.



7.11 Impact of case discussions withsubject understanding

92.1% of the total respondents eitheragreed or strongly agreed that theirunderstanding was enhanced on theparticular subject after a case discussion.Only 7.9% differ to the earlier propositionand none of the respondents stronglydisagreed to the same.

7.12 Preferred method of teaching

To determine the rank allocated to eachmethod of teaching as per the likings ofthe respondents; the principle of ‘lowsum of the overall ranking is equal tohigh rank of the particular subjectconcern’ was followed. Case studymethod was found to be the most liked(Rank 1) followed by Lecture methodRank 2, Presentation, Role play, Audio/ Visual and Management gamessecured Rank 3, 4, 5 and 6respectively.

7.13 Impact of case length onstudent’s psychology

80.4% of the total students eitheragreed or strongly agreed that the lengthof the case impacts their psychologybefore analyzing the case. 13.7% of thetotal students were not sure and 5.9 %of the students either disagreed orstrongly disagree to the aboveproposition. Hence, it can beconcluded that the students weresignificantly affected by the length of thecase.

7.14 Average preparation time forcase discussion or presentation

To solve a case; 7.8% studentsrequired less than 10 minutes and37.3% out of the total students took10-30 minutes and 30-60 minuteseach for the same. Only 17.6%students said that they required morethan one hour solving the case.

7.15 Preferred method of caseanalysis

It was found that, 43.1% of thestudents preferred to analyze the caseswith their peer groups. Whereas only7.8% of the students preferred to referto books. Similarly 17.6% of the totalstudents preferred internet. 15.7% ofthe students preferred to analyze thecases individually and the equalpercentage of students preferred totake the help of faculty members toanalyze cases.

8. TEST OF HYPOTHESIS

8.1 Test of Hypothesis – 1

H0: There is no difference between themale and female students withrespect to their methods of caseanalysis.

H1: There is difference between themale and female students withrespect to their methods of caseanalysis.

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Fig. – 1 [Comparison between the male and female students with respect to the methods of caseanalysis]

Source: SPSS output

Table – 1 [Comparison between the male and female students with respect to the methods ofcase analysis]

Source: SPSS output



Table – 2 [Relation between the male and female students with respect to the methods of caseanalysis]

a. 2 cells (33.3%) have expected count less than 5. The minimum expected count is 1.06.

Source: SPSS output

Interpretation:

From the above table it is evident that,the level of significance is .418. This ismore than 0.05. So the null hypothesiswas rejected and alternative hypothesiswas accepted.


H0: There is no relation between thenumbers of cases discussed in theclass with the studentsunderstanding of the particularsubject.

H1: There is relation between thenumbers of cases discussed in theclass with the studentsunderstanding of the particularsubject.

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Table – 3 [Correlation between the number of cases discussed and the students understandingof the particular subject]

Source: SPSS output

Table – 4 [Significance of correlation between the number of cases discussed and the studentsunderstanding of the particular subject]

a. 0 cells (.0%) have expected frequencies < 5. The minimum expected cell frequency is 10.2.b. 0 cells (.0%) have expected frequencies < 5. The minimum expected cell frequency is 12.8.

Source: SPSS output



Interpretation:

As the significance level is near to zero,accepted the null hypothesis wasaccepted.


H0: There is no impact of casediscussion on the development of

students’ analytical, problemsolving and decision making skills.

H1: There is some impact of casediscussion on the development ofstudents’ analytical, problemsolving and decision makingskills.

Table – 5 [Correlation between cases discussion and its impact on the students analytical,problem solving and decision making skills]

Source: SPSS output

Interpretation:

The significance level is more than .05,so the null hypothesis and acceptedthe alternative hypothesis wasrejected.


H0: There is no difference between thestudents’ educational backgroundand their liked method of teaching.

H1: There is difference between thestudents’ educational backgroundand their liked method of teaching.

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Table – 6 [Relation between educational back ground of students and their liked method ofteaching]

Source: SPSS output

Table – 7 [Level of significance of the test between educational back ground of students andtheir liked method of teaching]

a. 24 cells (100.0%) have expected count less than 5. The minimum expected count is .59.

Source: SPSS output



Interpretation:

As the significance level is .059 which isnear to .05, the null hypothesis wasaccepted.


H0: There is no difference between theimpact of case discussions with realbusiness situation and the impact

of case discussions with theunderstanding of the particularsubject among the students.

H1: There is difference between theimpact of case discussions with realbusiness situation and the impactof case discussions with theunderstanding of the particularsubject among the students.

Table – 8 [Level of significance of the test between the impact of case discussions and theunderstanding of the particular subject among the students]

Source: SPSS output

Table – 9 [Frequency of responses regarding the relevance of cases with real business situation]

Source: SPSS output

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Table – 10 [Frequency of responses regarding the impact of case discussion on the students]

Source: SPSS output

Interpretation:

As the significance level is 0, so the nullhypothesis was accepted.

9. MAJOR FINDINGS

After detailed analysis of the collecteddata some of the major findings are listedbelow:

� Case study method was found to bethe most liked teaching methodfollowed by Lecture method,Presentation, Role play, Audio / Visualand Management games.

� 91.1% of the total respondents eitheragree or strongly agree that case studymethod benefits in understanding asubject.

� 90.2% of total respondents agreed tothe relevance of cases with the subjectdiscussed in the class room.

� 56.9% of the total respondentspreferred the open / interactive methodof case discussion; where as 37.3%

of the total respondents liked thegroup discussion method.

� Marketing was the most liked casesubject followed by HRM, Finance,OB, Economics, GeneralManagement, IT and Communicationwas the least liked case subject.

� 82.4% of the total student eitherstrongly agreed or agreed that casesdiscussed in the class brings realbusiness situation to them.

� All the students were, more or less,able to correlate the case scenariowith real business situations.

� 92.1% of the total respondents eitheragreed or strongly agreed that theirunderstanding was enhanced on theparticular subject after a casediscussion.

� 80.4% of the total students eitheragreed or strongly agreed that thelength of the case impacts theirpsychology before analyzing the case.



� 43.1% of the students preferred toanalyze the cases by discussing withtheir peer groups.

� There is difference between the maleand female students with respect totheir methods of case analysis.

� There is no relation between thenumbers of cases discussed in the classwith the students understanding of theparticular subject.

� There is some impact of casediscussion on the development ofstudent’s analytical, problem solvingand decision making skills.

� There is no difference between thestudents’ educational background andtheir liked method of teaching.

� There is no difference between theimpact of case discussions with realbusiness situation and the impact ofcase discussions with theunderstanding of the particular subjectamong the students.

10. SUGGESTIONS

After interpreting the collected data andgoing through the major findings; thesummary of the major suggestions whichcould be implemented at KIIT School ofManagement are listed below:

� Case method of teaching should begiven prime importance.

� Open/interactive method of casediscussion should be encouraged.

� Interesting cases in subjects likeCommunication, IT, GeneralManagement, Economics and OBshould be selected and discussed inthe class.

� Short cases should be chosen fordiscussion and bulky cases should beavoided irrespective of the subjectconcerned.

� Though case method was found to bethe most liked method of teaching; thenumber of cases to be discussed in asubject should be specified by thefaculty.

� A perfect blend of case method withother teaching methods should beworked out.

11. CONCLUDING REMARKS

The case method plays an essential rolein management education (Banning, 2003;Dooley & Skinner, 1977). According toan article published by the HarvardBusiness School, the function of a case isto provide a “description of real businesssituations that serve as a metaphor of aparticular set of problems”. Hence takingboth the above discussed propositionstogether it can be concluded that cases“provide useful and relevant set ofmetaphors that can be applied to mostmanagement situations”. Cases tend toemphasize reasons over emotions,economics over politics, material benefitsover intangibles and meanings, and strategyformulation over organization building.

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The case method of teaching is highlycontext-specific in terms of effectiveness;therefore, the instructors must be carefulabout the choice and age of the case,keep in perspective the participants’(students’) profiles, their background andthe lessons (conceptualizations) sought tobe realized. Case method seeks toovercome the limitations of the lecturemethod where one ‘guru’ comes anddelivers ‘known’ knowledge in a highlystructured format.

The case method is a creative missionwhere many perspectives andbackgrounds cross each other to producea mix of strategic and innovative ideas.The role of case instructors ought to helpstudents appreciate various viewpoints,harness the workable ideas, and thenarrive at a common solution. The needfor instructors to be sensitive to thepossibility of using case method isadvocated with a good mixture oftheoretical conceptualizations and lecturesfor arriving at inductive or deductiveframeworks and heuristics. Caseinstructors must act like ideas andperspectives brokers to harness students’creative, analytical, problem solving anddecision making skills rather thanimposing their own views in theclassroom.

12. RESEARCH LIMITATIONS

Everything and everyone has certainlimitations, so has this research. Theremay be several possible limitations of ourresearch which are listed below:

a. The data collected from the studentrespondents may be a bit biased, asthey belong to the same institution andshare same resources.

b. To ensure the research time limit,researchers were unable to touch indepth of a bigger target group.

c. The researchers had other academicand personal obligations to addresswith equal importance.

d. Stratified random sampling has its ownlimitations.

e. Few respondents spared less time, tofill up the questionnaire.

13. DISCUSSION FOR FURTHERRESEARCH

In order to nullify the above discussedlimitations further research can be done.This research itself has opened newdimensions for further research. Thesample size was very small and the surveywas limited to KSoM only. The sameapproach can be adopted to find out thestudents’ perception and effectiveness ofcase method across B-Schools of India.More variables could be taken; thus morepropositions can be proved andmeasured in a broader framework. Morequalitative data could be collected byfocus group transcripts and observationalmethods.

14. REFERENCES1. Jain A. K. (2005), Management

Education and case method: Apedagogy, Vikalpa, Vol. 30, No. 1,pp 77-84.



2. Neng L. and Wang J. (2004), ImplicitMental Models in Teaching Cases: AnEmpirical Study of Popular MBACases in the United States and China,Academy of Management Learning &Education, Vol. 3, No. 4, pp 397–413.

3. Thompson E. R. (2001), Are teachingcases appropriate in a mainlandChinese context? Evidence fromBeijing MBA students, Journal ofEducation for Business, pp 108 – 112.

15. APPENDIX

QUESTIONNAIRE

Dear Sir / Madam,

We are from the School of Management,KIIT University Bhubaneswar. We areconducting a survey on ‘Case Methodof Teaching’, as part of our researchproject on Business ResearchMethodology. We shall be grateful to youif you could spend some time with thisquestionnaire. Your responses will betreated as confidential & will be used foracademic purpose only.------------------------------------------------------------------

Section – 1

Put tick mark against your choice (inany one only)

1. Please mention to which age groupdo you belong to?

a. 20 – 23 b. >23 – 25c. >25 – 28 d. Above 28

2. Please mention your gender.

a. Male b. Female

3. Please mention your educationalbackground (based on the lastqualification attended)

a. Graduation (B.Sc./B.A./B.Com.etc)

b. Professional Course (B. Tech./B.Arch./Bio. Tech. etc)

c. Post Graduation/Master Degree

d. If any other, please specify.............………………………...

Section – 2

1. Do you think the case study methodbenefits a lot to you in understandinga particular subject?

a. Strongly agree b. Agreec. Can’t say d. Disagreee. Strongly disagree

2. Do you think the cases are relevantor appropriate to the context of thesubject?


3. Which method of case analysis youlike the most?

a. Individual b. Groupc. Open/Interactive d. If other,please specify ………

4. Please rank (from 1 to 9) thefollowing as per your likings of casesdiscussed in the particular subject.(Rank-1: Most liked and Rank-9:Least liked)

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Subject Ranka. Marketingb. HRMc. Financed. POMe. ITf. Economicsg. O.B.h. General Managementi. Communication

5. Cases bring real business situationto the class room?


6. How often cases are discussed inyour class room (per semester in aparticular subject)

a. Never b. Rarely(< 3)c. Often(1-3) d. Quite often(4-7)e. Frequently (>7)

7. Can you relate any case situation witha real business scenario?

a. Completely b. Somewhatc. Little d. Few e. Not at all

8. After a case discussion, yourunderstanding of the particularsubject is enhanced.


9. In your opinion which is the mostappropriate method of teaching for

MBA class rooms, rank (1 to 6) thefollowing (Rank-1: Most liked andRank-6: Least liked)

Method of Teaching Ranka. Lecture

b. Case study

c. Role play

d. Presentation

e. Management games

f. Audio/Visuals

10. How do you like to analyze thecases?

a. Individuallyb. Referring internet sourcesc. Referring booksd. Consulting faculty memberse. Peer group discussion

11. The length of the case affects yourinterest (psychology) to read,interpret and analyze the case?


12. How much time do you devote toprepare for the case prior todiscussion?

a. < 10 minutesb. 10 to 30 minutesc. 30 minutes to 1 hourd. > 1 hour



IMPACT OF MINING ON TRIBALLIVELIHOOD:

An empirical investigation into the customary frameworksand Issues affecting Sustainable Livelihood in Eastern India

Anil OtaSustainability Officer

Alumina RefineryVedanta Alumimium Limited

Lanjigarh

Abstract

Apart from displacing people from their ancestral home and severingtheir cultural ties and bonds established over generations, mining alsodevastates the livelihood of the Tribals inhabiting areas experiencing suchactivities. With the onset of the era of Liberalization, Privatization andGlobalization (LPG) coupled up with other Corporate-friendly legislations toencourage Multi National Corporations (MNCs) to establish their businessconcerns in India such as the Industrial Promotion Resolution (IPR) enacted bythe Government of Odisha (GoO), prevailing levels of mining activities havereceived a major boost leading to the physical displacement and livelihooddispossession of millions of Tribals in Eastern India alone. Being the homelandof the Tribal People, Eastern India comprising up of the States of Jharkhand,Odisha, Chhattisgarh and West Bengal is also home to a variety of mineralreserves located in mountain cappings, most of which are habitation sites ofdifferent Tribal Communities. Under such circumstances, it was consideredimperative to undertake an empirical survey in the areas inhabited by thisvulnerable section of the population in Eastern India to unravel the variousunderlying factors affecting their livelihood so that an Integrated LivelihoodRevival Plan (ILRP) can be generated to mitigate the adverse implications ofmining on Tribal livelihood. The key findings of the present study provide asnapshot of the critical issues affecting sustainability in areas experiencingmining activities. At the end, the Researcher-author provides his views withregards to the contributions he thinks the Present Study has made to the broaderframeworks of Sustainable Development and Sustainable Livelihood from theperspective of the Eastern India Tribes.

Keywords: Livelihood Framework, Mining, Quality of Life, Sustainability, TribalLivelihood

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An Introduction to Eastern India

Eastern India comprising of the States ofOdisha, Jharkhand, Bihar and WestBengal constitutes one of the mostbackward and underdeveloped zones ofIndia characterized by abject poverty andsevere food insecurity but simultaneouslyan abundantly rich natural and mineralresource-base. It is pertinent to mentionhere that except the melancholies ofpoverty and food insecurity in the region,

there is no other feature/ attribute that canbe associated to all the sub-regions of thispart of the Country. In fact, the unstintedmineral reserves, the diverse flora andfauna, the Scheduled Castes andScheduled Tribe population, the forestcover etc. are all inequitably distributedacross the belt with certain regionsaccounting for a massive chunk of themand most others being completelydeprived of their presence.

Geographic, Demographic and Mineral Profiles of Eastern Indian States

1. Geographical Area (In Square Kilometers)a. Odisha 155,707

b. Bihar 94,164

c. Jharkhand 79,700

d. West Bengal 88,752

2. Population and Density (Census of India Report 2011)a. Odisha 41,947,358, 269.39 Persons per Square Kilometer

b. Bihar 103,804,637, 1102.38 Persons per Square Kilometer

c. Jharkhand 32,966,238, 413.62 Persons per Square Kilometer

d. West Bengal 91,347,736, 1029.24 Persons per Square Kilometer

3. Official Language and Literacy Rate (Constitution of India and Censusof India Report 2011)

a. Odisha Odia, 68.8 5

b. Bihar Hindi, 54,1 %

c. Jharkhand Hindi, 58.6 %

d. West Bengal Bengali, 71.6 %

4. Major Minerals available and Poverty Ratea. Odisha Coal, Iron Ore, Bauxite, Chromite etc.

b. Bihar -

c. Jharkhand Coal, Copper, Mica, Bauxite, Graphite, Limestone, Uranium etc.

d. West Bengal Coal, Rock Phosphate, Granite, Manganese, Silica, Fire Clay etc.

Impact of Mining on Tribal Livelihood


The presence or absence of suchresources play a vital role in determiningthe socio-economic and occupationallandscapes of a region and the same isrevealed when one observes the povertyand occupational profiles of the areaspossessing huge mineral and forestreserves. To be precise, the regions whichare inhabited by the Tribal population arefound to be thickly forested andabundantly rich in a variety of mineralreserves. Similarly, the minerally richregions are socio-economically the mostbackward sections of their respectiveStates. While a section of scholarsattribute the relatively dispersed andscattered nature of habitation to be theprimary factor behind the ineffectivenessof Government Schemes in the region andthe consequent misery of poverty andfood insecurity countered by itsinhabitants, another school of thoughtopines that the sheer distance from theState Capital (which in case of mostmineral-rich belts in India is huge) is themajor cause of under-development of thevicinity. The third school of thoughtsupported by major Industrial Housesand Mining Giants views the problemdifferently attributing one single factorbehind the socio-economic desolation ofsuch regions i.e. the non-utilization of thebountiful mineral reserves and the non-setting up of Mineral Processing Units

Review of Literature – DefiningSustainability?…before we can even start talking topeople about sustainability, we need tobe able to communicate what it is.1

Although, the term SustainableDevelopment (also known assustainability, sustainable progress etc.)is generally interpreted by people to be aterm which denotes the need for judiciousutilization of natural/ mineral resources formeeting human desire so that adequateproportion of the same can be preservedfor the succeeding generations2, to date,there is no universally agreed (and henceapplicable) definition of the term. VariousInternational Non-GovernmentOrganizations (NGOs), CorporateHouses, Management ConsultingAgencies etc. have propounded theirversions of the definition trying to elucidatethe meaning of the term which one canfind in the official website of such entities.The succeeding paragraphs of this sectionof the Paper will be used to documentdown some of the most widely accepteddefinitions of the term along with theirinterpretation in the language of theResearcher-Author.

1 Ms. Dharon Ede. Transcription of Evidence. 24 May 2007. P.52 This statement has been framed by the Researcher-Author on the basis of his interaction withsubject-matter specialists in the domain of Sustainable Development as well as the gruelingreview of literature which he carried out during the course of the secondary research on thetopic under study

which will not only generate employmentopportunities (Direct as well asDownstream) but will also help in theinfrastructural development of the region.

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… development that meets the needsof the present without compromisingthe ability of future generations to meettheir own needs3

The above-cited definition of SustainableDevelopment was proposed in 1987 inthe report “Our Common Future”prepared by the World Commission onEnvironment and Development. By far,this is the most extensively acknowledgedconnotation of the term conveying aprecise meaning and embedded with anunmatched mold of clarity and precision.However, there are a few perceivabledrawbacks in this definition i.e. (a) theacute lack of rationale in asking foradhering to a model of developmentwhich would spare resources for thefuture and (b) failure in pointing out theadverse implications of abiding by a non-sustainable model of development.

Using, conserving and enhancing thecommunity’s resources, so thatecological processes, upon which lifedepends, are maintained, and the totalquality of life, now and in the future,can be increased4

This definition was provided by theNational Strategy for EcologicallySustainable Development (NSESD),Australia in response to the BrundtlandReport in the year 1992. Although a lot

of effort was made by the steeringcommittee in covering a wide range ofaspects involved in determiningsustainability while coining the term, someextremely vital ones were left out. To beprecise, the definition fails to addressissues such as social sustainability,financial judiciousness and so on as aresult of which, it has been criticized byvarious intellectuals of being Australia-specific/centric for which it has limitedapplicability outside the island Nation.

Although the Concentric Model ofSustainability has been argued to be oneof the most robust and self-explanatorymodels of Sustainable Development havingpractical implications on the way businessis conducted, but, the recent surge indemand for including a forth bottom linetitled “Governance Performance”indicating business conformity to pre-determined environmental/ ecologicalstandards has created a dent in theacceptance base of this model.

3 Dunphy, D. Benveniste, J. Griffiths, A and Suttobn, P. 2000. Sustainability: The CorporateChallenge of the 21st Century. Allen and Unwin, New South Wales, Australia. p. 224 Ecologically Sustainable Development (ESD) Steering Committee. 1992. National Strategy forEcologically Sustainable Development, Australian Government, Canberra.Available at http://www.environment.gov.au/esd/national/nsesd/strategy/intro.html#WIESD

Figure 1 Concentric Model of Sustainability– Triple Bottom Line

Source: Water Corporation, Submission No. 115, p. 3



Without dragging the process of literaturereview any further, it would beappropriate to sum up the meanings andattributes of Sustainable Development assurmised from the above-definitions andmodel discussed in the Research Paperas interpreted and in the language of theResearcher-Author: -

1. Judicious use of natural and mineralresources

2. Aspiring for development which doesnot compromise the ability of the futuregenerations for the same

3. Pattern of Development which isecologically harmless

4. Pattern of Development that maintainsQuality of Life (QoL) both of presentas well as future

5. Economy is subsidiary to humansociety which in turn is subsidiary tothe biosphere

6. Performance Governance is animperative ingredient of SustainableDevelopment

The Customary and ContemporaryScenarios of livelihood frameworkamongst the Eastern Indian Tribes

The engagement patterns of anyCommunity/ Society is a reflection of boththe occupation its members are inclinedto be associated with, as well as, the levelof economic life they lead. Although, inprimordial times, all human societiesthrived and eke out a living through theruthless exploitation of natural resources

and depended on forest to meet theirrequirements in life but, identification ofalternative means of livelihood led agradual evolution of human economycharacterized by the shift of a significantproportion of the global population fromthe agricultural mode of economy to anindustrial lifestyle by the end of the 20th

Century. The phenomenon ofindustrialization which started in WesternEurope in the early 17th Century led toan astounding increase in the growth ratein these regions and soon spread to otherparts of the globe including the BritishEmpires States such as India.

The Tribals in India who constitute oneof the most archaic yet socio-economically disadvantaged sections ofpopulation continue, to a large extent,profess crude forms of economy to earna living. To be precise, the customaryframework of livelihood being professedby the Eastern Indian Tribes includeswithin its fold a range of sources fromwhich an economy, mostly edibles arecollected. The sources of Tribal livelihoodin Eastern India include the following: -

1. Hunting and Gathering

2. Foraging and Food Gathering

3. Shifting Cultivation

4. Artistry

5. Peasantry

6. Terrace Cultivation

7. Settled Agriculture

8. Industrial Labor

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With a dynamic shift in the approach ofthe Government post Liberalization,,Privatization and Globalization (LPG) ofthe economy in the 1990s, paramountfocus is being laid towards utilization ofthe available mineral resources in differentpockets of the Country throughpromulgation of a range of legislativereforms to create a suitable environmentfor Multi-National Corporations toinstitute their business concerns in theResource-rich areas of India. It ispertinent to mention here that in EasternIndian, majority of the mineral cappedmountains are the abodes of the Tribalpeople, who in recent times have beendispossessed of their traditional livelihoodand have been displaced from theirresidential dwellings owing toestablishments of Industrial setups in theirlocality. Owing to the aforementioneddevelopments concerning the augmentedpace of industrialization in Tribal areas,the eighth and final category of Tribal

livelihood specified in the above-list hasbeen expanding rapidly over the past twodecades by accommodating largenumerical figures of Tribals at the cost ofthe adherents-base of all other sourcesof livelihood. Hence, there has been asignificant alternation in the customarylivelihood framework in Eastern Indiawith a large number of Tribal youthsgetting engaged in industrialestablishments to earn a living in the formof contractual laborers and in some caseseven permanent employees of differentbusiness concerns.

Research Design

The present study was undertaken in 8Sample Districts selected through SimpleRandom Sampling located in four EasternIndian States such as Odisha, Jharkhand,Bihar and West Bengal. Given below is atabular account of the Districts underStudy, their State-affiliation and thesample population covered: -

Table 1 Geographical Coverage and sample used for the present study

Source: Research Design

Name of Districts Number of Sample Populationthe State under Study Blocks covered Covered

Odisha Rayagada 3 113

Koraput 5 70

Bihar Champaran 5 42

Purnia 3 47

Jharkhand Goda 3 77

Pakur 5 45

West Bengal Munshiganj 5 48

Jalpaiguri 3 68

Total Sample Population 510



Apart from the central objective ofidentifying the adverse implications ofmining on Tribal livelihood, the presentstudy was undertaken for attaining a rangeof other objectives associated with theprincipal purpose which are as follows: -

1. To conduct a brief review of existingliterature pertaining to the termsustainability and its definitions so thata central theme and feature of theidiom could be derived

2. Identify the customary andcontemporary frameworks oflivelihood in the Tribal-dominatedregions of Eastern India, so that theimpact of mining and industrializationon the local ecology could be clubbedwith up with its adverse implicationson the source of living of the Tribalpeople

3. To understand the overall phenomenonand the present pattern of miningactivities being undertaken in Tribal-dominated regions of Eastern India

4. To identify the major implications ofmining on the life and livelihood ofTribal and Indigenous people

5. To illustrate the pertinent contributionsof the present study and ResearchPaper to the field of SustainableLivelihood

For the purpose of obtaining the requireddata and facts on the subject-matter, awide range of research techniques wereutilized to gather information from bothPrimary as well as Secondary sources.Given below is a list of the major techniquesof data collection utilized by theResearcher-author for the present study:

1. Interview Technique

2. Observation Technique (ParticipantObservation and Non-ParticipantObservation)

3. Case Study Technique

4. Participatory Rural AppraisalTechnique

5. Focused Group Discussion (FGD)Technique

Various major activities were undertakenduring the course of the study, a brief ofwhich along with the timeframe allocatedto each of them has been mentioned inthe succeeding table.

Table 2 Profile of Major Activities Undertaken

Sl. No Major Activities Undertaken Timeframe (In Weeks)01 Review of Literature 302 Formulation of Chapter Plan 103 Selection of Techniques for Data Collection 104 Data Collection 605 Data Analysis and Data Interpretation 206 Formulation of the Research Paper 3Total Timeframe 20

Source: Research Design

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Key Findings of the Study – CriticalIssues affecting sustainability inregions experiencing Miningactivities

With the exception of Bihar, all otherEastern Indian States are blessed withbountiful reserves of a wide assortmentof minerals. The mineral resources inIndia and other developing third worldCountries in general and the EasternIndian States in particular were largelyunderutilized owing to a variety reasonsincluding lack of advanced technologicalequipments, poor communication and thecumbersome administrative procedureinvolved in setting up of Processing Unitsby Industrial Houses. However, with thebeginning of the 21st Century (asmentioned earlier), harnessing of mineralreserves has increased manifold primarilydue to the large-scale investments madeby International Industrial Giants whohave shown keen interest in harping uponthe high quality mineral resources locatedin the region for meeting their businessends. The Industrial PromotionResolution (IPR) 2001 enacted by theGovernment of Odisha to convert theimage of the State of being a privilegeddestination for industrial investment hasalso contributed its share in boostingindustrialization in the State.

It is pertinent to mention here thatalthough, adequate measures have been

initiated by the State Governments in theregion for amending the relatively inflexibleadministrative framework pertaining toobligatory authorizations and theburdensome procedure involved ingranting approvals to Global BusinessConcerns to realize their commercialpotential in the region, very little has beendone to both, assess, as well as, tomitigate the socio-economically andecologically hazardous implications ofmining especially on the forest dwellers.As a result of this, the customary forms/sources of livelihood of the mostly TribalPopulation inhabiting the mineral-richmountain cappings have been severelyaffected as their access to forests hasbeen restricted to a considerable extent.The succeeding paragraphs have beenused by the Researcher-author toemphasize in a nut-shell, the negativeimplications that mining is having on thesustainable lifestyles of the localpopulation in Eastern India which alsoconstitute the outcome of the presentStudy: -

1. Acquisition of agricultural land hasforced its original title-holders to spotout an alternative source of livelihoodforfeiting their age-old occupation offarming which they have inherited fromtheir forefathers5. The absence of therequired skills and any formal trainingfor incorporating the requisiteexpertise to discharge the roles and

5 Tribals Losing Livelihood Due to Land Acquisition: Tirtha. Accessed on 29.07.2011 (http://www.lensonnews.com/lensonnews/1/59/2118/1/tribals-losing-livelihood-due-to-land-acquisition:-tirath.html)



responsibilities associated with thenew pattern of engagement makes lifemiserable for the involuntarilydisplaced

2. Similarly, involuntary displacement isresulting in forcible evacuation ofpeople from their ancestralresidential dwellings and without aproper Resettlement &Rehabilitation (R & R) Frameworkin vogue, the relocation measuresbeing implemented by both theGovernments as well as the ProjectImplementing Agencies are provingto be highly insufficient, inefficientand discriminatory

3. Acquisition and restriction fromentering into forests has posed seriousthreats to the livelihood especially ofthe Tribal population who primarily useMinor Forest Produce to eke out aliving and depend on local jungles tomeet their requirements of fuel woodfor cooking, medicinal plants for herbaltreatment of diseases, animals andforaging for meeting their appetite andso on

4. Deposition of dust, smoke and fumesfrom mines caused by blastingconducted to draw mineral reservesout of the mine sources in their rawstate in water bodies, leaves of plants,on the roof of the residential dwellingsof the local people is resulting in

serious and at times even incurablediseases leading to large-scalemortalities6 in mining belts across theregion

5. Discharge of mining effluentsespecially in the form of black waterduring coal mining and excessive useof water during ecologicallydevastative means of mining hasresulted in drastic depletion ofground water table which is causingproblems on part of the localcommunities to meet theirrequirements for potable water intheir day-to-day life

6. The eligible Tribal youths who areemployed by the Industrial Housesboth lack the requisite educationalqualifications as well as the essentialskills required to discharge theirprofessional obligations and are henceassigned low-level and unskilledassignments at work which arephysically arduous and at the sametime low-paying

7. The abrupt influx of large-scale outsidepopulation to serve the business needsof the newly established industrialconcerns coupled up with suddenexposure to their modern andadvanced lifestyles is both inculcatinga sense of inferiority complex with thelocal Tribals as well as resulting ingradual Social Disarticulation. In fact,

6 Mining Operations pose serious health risks. Media Statement by Bench Marks Southern Africa forCorporate Social Responsibility on 25th June 2007. Accessed on 29.07.2011 (http://www.bench-marks.org/downloads/070625_pr_mining_health_threats.pdf)

69

the impact of the modern culturebrought by the outside population issuch that the Tribal youths are gettinglured towards its tenants therebyshowing disinterest their own culturewhich is contributing towards theidentity and culture crisis in manyTribal-areas experiencingindustrialization and mining activities inrecent times

8. The approach of mappingdevelopment initiatives to beimplemented for the betterment andwelfare of the Tribals inhabiting thelocality are mostly being done usingthe top to bottom approach whichdoes not involve the opinion and viewsof the intended beneficiaries of theproposed schemes, programmes etc.Such an approach for formulating thedevelopment framework in Tribalareas is not only non-participatory anddictatorial in nature but often failsmiserably in attaining its objectivesand ends up making hardly any impacton the prevailing levels of life being ledby the local inhabitants

The findings highlighted in theaforementioned paragraphs have beenformulated by the Researcher-author bycollecting, analyzing and interpretinginformation and data pertinent to thesubject-matter from a variety of sourcesincluding review of literature, interactionwith eminent researchers and scholars,interaction with the sample respondentsetc. All possible efforts were made to

ensure that any specific finding made fromeither of the three sources of informationwere cross-checked with the other twosources for validation and substantiationbefore they are included in the list offindings. All the findings irrespective oftheir respective area of focus highlight thefact that although the ongoingphenomenon of mining andindustrialization in Tribal areas is fuelingthe rapid economic growth that theCountry has been experiencing but, at thesame time, the lack of policy provisionsand administrative enthusiasm towardsmaking the poor and marginalized apartner to the fruits of development isresulting in a further degradation of theiralready diminished standards of living.

Contributions to the field ofSustainable Livelihood andConcluding Remarks

Apart from highlighting its predeterminedobjective of exhibiting the prevailingscenario of mining which is not onlydevastating the customary cultural fabricsand displacing people in Tribal India butis also adversely affecting their potentialto earn their own livelihood, the PresentResearch Paper in general and itsoutcome in particular have alsocontributed towards the broaderdiscipline of Sustainable Developmentand Sustainable Livelihood. In fact, theabsolute focus on sustainability and alliedissues which form the core of the researchdesign which has been purposefullydevised to undertake the present



empirical survey has helped generateoutcomes which are significantly differentthat the ones documented down by mostother research exercises.

To be precise, the outcomes of thepresent survey which have beenexhibited under the caption of KeyFindings apart from focusing on thecentral issues affecting the livelihood ofTribals owing to the recent surge inmining activities has also emphasized onthe areas that need to be included withinthe broader framework of Sustainabilitywhich can be construed as itscontributions to the field ofSustainability: -

1. Need for incorporating ForestPolicies under the ambit ofSustainability: The prospects ofearning livelihood by underlining theadverse implications of involuntaryacquisition of forest land andformulation of legislations to prohibitaccess of the tribal people to jungleresources

2. Need for formulating andeffectively implementing aconsultative Resettlement andRehabilitation Policy:Deficient Resettlement andRehabilitation packages beingextended and improperimplementation of the same hasresulted in non-restoration of themisplaced livelihood opportunities ofTribal people

3. Need for laying emphasis onminute environmentalramifications of mining especiallyon the local community: A p a r tfrom focusing on broaderenvironmental aspects such ascarbon emission, carbon trading andthe impact of mining on the overallecological set-up of the locality,greater emphasis should be laid oncritically analyzing the narrowerimplications of environmentaldegradation caused by mining byinvestigating into complaints ofdeposition of dust and fumes onwater bodies, kitchen appliancesand farmlands located in nearbyareas

4. Need for including culture as anintegral aspect of SocialSustainability: Consider ingculture to be an indispensableingredient of the social existence ofhuman being, its conservation shouldbe laid further emphasis as itsdilution might often result in identitycrisis which may lead to socialdisharmony

5. Need for regulating the abruptinflux of outside population intoareas experiencing miningactivities: This is essential asexposure to the culture professed byand the lifestyles adhered to by theoutside population as described earliermight incorporate an inferioritycomplex within the local population

71

and inflict social disarticulation whichis considered to be even more harmfulthan physical displacement andlivelihood dispossession

Apart from the aforementionedcontributions which the Researcher-author feels that the Research Papermight have made to the fields ofSustainable Development and SustainableLivelihood, it is sincerely hoped that thePresent Empirical Survey will definitelyhelp in igniting young minds and ResearchScholars to undertake studies in thedomain under focus with even greateremphasis being laid on furtherrudimentary aspects concerning theimpact that mining has on the socio-economic life of the Tribal people.Embarking on niche-oriented studies inthe field will not only help enrich the grosslydeficient literature base but will also helpin contributing towards the formulation ofan appropriate National Legislationaccentuating at circumventing atrocitiesand negating the differential treatment ofthe vulnerable sections of the Country’spopulation in general and the Tribal peoplein particular.

Bibliography

Bhushan, C. and Hazra, M.Zeya. (2008.)Rich lands poor people: Is “Sustainable”mining possible?, New Delhi: Centre forScience and Environment.

Ota, A.B. & Mohanty B.B. (2010.)Population Profile of Scheduled Tribes inOrissa. Bhubaneswar: Scheduled Castesand Scheduled Tribes Research andTraining Institute (SCSTRTI),Government of Orissa.

Ota, Anil. (2010.) Displacement andRehabilitation Issues in Tribal areas: Adiagnostic Analysis. New Delhi: Inter-India Publications.

Ruggie, J. (2010.) Business and HumanRights: Further steps towards theoperationalization of the “protect, respectand remedy” framework, UN HumanRights Council.

Twigg, J. (2001.) Sustainable Livelihoodsand Vulnerability to Disasters. BenfieldGreig Hazard Research Centre, DisasterManagement Working Paper.



MOBILE BANKING IN INDIA-ANEMPIRICAL STUDY IN THE CITY OF

HYDERABAD

Dr. Suresh Chandra BihariProfessor (Banking & Finance) IBS,

[email protected] [email protected]

Abstract

With evolving technology, banks are harnessing the power of innovationto provide a better banking experience to the customers. Mobile Banking willallow customers to view their account statements, transactions and even makepayments through their mobile handsets. Next Generation banking solutionsare already evolving and very soon there will be more user friendly applicationsand faster services. Banks will benefit from lower costs and Customers will reapthe benefits of faster technology, convenience and ease of banking. It s importantto understand the 4 R’s – Run rate, Risk, Regulation and Reputation with respectto mobile banking in this context.

Introduction

India has witnessed four distinct phasesin banking since independence. Thefourth phase or the Reform Phase asit’s popularly known saw theRecommendations of the NarasimhamCommittee in 1991 which eventuallyushered in banking sector reforms.Several initiatives and steps wereintroduced such as adoption ofprudential norms for incomerecognition, deregulating interest ratesand de-shackling the barriers to entryfor new banks. This move led toincreasing competition, higher

awareness among customers and a racefor technological innovation amongbanks. Private Banks and ForeignBanks scored over the Indiancounterparts due to the sophisticatedtechnology, convenience and ease ofbanking processes. This led to acompetition to innovate not only to beatthe competition and survive but also toretain the customer base.

Technology has been applied in a 2 foldprocess in the Banking Sector.• Improve communication and

connectivity• Business Process Reengineering

73

Technology helps in reducing the distancebetween branches and customers,diversify products and markets, improvesbank infrastructure, increases efficiencyand helps to manage risk in a moresystematic manner. It also helps tomanage liquidity positions in banks andleads to better forex market managementand asset monitoring.

Literature Review

Barnes and Corbett (2003); Scornavaccaand Barnes (2004) suggest that latestinnovations in telecommunications havefacilitated the launch of new accessmethods for banking services, one ofthem is mobile banking; whereby acustomer interacts with a bank via amobile device such as a mobile phone orpersonal digital assistant. Karjaluoto etal. (2002); Rugimbana (1995) found thatthere is a huge market potential for mobilebanking due to its functionality and theoption to do banking virtually any timeand anywhere.

Unnithan and Swatman (2001) havestudied the drivers for the transformationin the advancement of the banking sector,and the move towards electronic bankingwhich will include mobile banking byfocusing on two major economies,Australia & India whereby it suggests astrong growth prospective of bankingchannel in India. Clark (2008) suggeststhat as a Channel; the mobile phone canenhance the ways available to consumers,thereby giving consumers more low-costself-service options by which they have

an access to funds, banking informationand payments. Mobile as a means deliversconvenience, immediacy and choice toconsumers. Vyas (2009); Rao et al.(2003) suggest banks that they will needto develop or increase their thinking aboutmobile banking beyond online bankingand should start to view mobility as itsown powerful and compelling deliverychannel that can help them deliver to endusers that is the ultimate customers.According to Vyas (2009) banks willtarget non-online banking users who maylack a usual access to desktop Internetbut are very likely to own a mobile device.Gupta (1999); Pegu (2000); Dasgupta(2002) also affirms future of mobilebanking in India in their studies. Suoranta(2003) found that the average mobilebanking user is married, 25 to 34 yearsold, has intermediate education andaverage income in clerical work. Shefound that age and education have a majorinfluence on the use of the mobile phonein banking services. The adoption theoriesassume that use of Internet banking wasbefore the adoption of the mobile phonein banking.

However, Suoranta (2003) found thatsome mobile banking customers areneglecting the internet banking adoptionwhen adopting the mobile phone forbanking actions. Polatoglu et al. (2001);Al-Ashban and Burney (2001);Karjaluoto et al. (2002); Black et al.(2002) supports findings of Suoranta intheir respective studies. Mas (2008);Lyman et al. (2008) found that there are

Mobile Banking in India - An empirical study in the city of Hyderabad


a huge number of distinctive mobile phonedevices and it is a big challenge for banksto offer mobile banking solution on anytype of device. Some of these devicessupport J2ME and others support WAPbrowser or only SMS; presetting aserious challenge. Hayat (2009) suggeststhat for a banking regulator it is importantto provide adequate protection forconsumers, ensure economic stability,provide interoperability of electronicsystems and guarantee security oftransactions and Anti-Money Launderingand Know-Your-Customer principlesmust also be applied to mobile payments.Comninos et al. (2008) suggest thatunbanked will only transact electronically(online/mobile banking) if there isconvenience and security. Sharma andSingh (2009) found that Indian mobilebanking users are specially concern withsecurity issues like financial frauds,account misuse and user friendlinessissue - difficulty in remembering thedifferent codes for different types oftransaction, application softwareinstallation & updation due to lack ofstandardization. Banzal (2010) found thatanother major issue is the revenue sharingagreements between mobile serviceproviders, banks, content providers,aggregators and other service providerslike utilities, travel agencies, hotel industry,retailers, etc.

BACKGROUND

Mobile banking as the name suggestsis basically using a mobile phone to do

banking activities for customer likechecking account balance, accounttransactions and payments etc. Generally,mobile banking is done through SMS orthe Mobile Internet.

The advent of Mobile banking is primarilydue to the rapid growth and expansionof the mobile market in the world and inIndia. With more than 2.5 million users inIndia alone, mobile banking is a veryattractive avenue for most banks.

Mobile banking enables banks to offerservices like fund transfer, updates onstock prices, stock trading etc while beingon the move. Thus, it greatly improvesthe ease of doing business from the pointof view of customer.

Based on the projections by Towergroup, India is set to witness phenomenalincrease in Mobile banking. Mobilebanking facility is expected to grow at arate of nearly 52% CAGR during 2009– 2013.

Mobile Phone users are still justdiscovering the full capabilities of mobilebanking and thus, mobile banking is justtaking off especially in Asian countries likeIndia, China, and Taiwan etc.

However, to attract rural consumers, therole of a banking agent assumes primeimportance. A banking agent could be aretail outlet which would carry outfinancial transactions on behalf of thebank. It would also manage customercare, serve as a point of contact with

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customer, provide service and help incash management. Thus, to tap the ruralmarket potential, it is important toincorporate banking agents into thebusiness model.

Also, an interesting thing to note is thatMobile Banking has significantadvantages over online banking.Customers do not require a computer tocarry out the desired transaction oractivity. The potential of mobile bankingin India can be corroborated through theestimates of Cellular Operator’sAssociation of India (COAI) which saysthat the mobile base in India in 2004 was40.6 million. Thus, there has been anexplosion in the consumer base of mobilephone users and mobile banking is largelyuntapped and unexplored giving rise tohuge possibility of market demand andaccess.

There are a number of banking modelswhich revolve around the relationship withthe end customer. They have beendivided into 3 categories:

• Bank Focused• Bank-Led• Non Bank-Led.

• Bank-focused modelThis can be considered as an extensionof traditional banking which is branchbased. A bank will use low costing newchannels to provide banking services suchas ATM or internet banking etc tocustomers. However, the services arelargely limited.

• Bank-led model

This model gives a very differentalternative to conventional bankingbecause the customer can conductfinancial transactions with the help of arange of retail agents. This helps the banksto significantly increase the penetration offinancial services by using a differentdelivery channel, a more experiencedtrade partner etc which can result insignificant cost savings for the bank.

• Non Bank-led model

This is a model where the bank does notplay any role except, maybe, as a keeperof excess funds and the non-bank has theonus of performing all the functions.

Technologies used in MobileBanking

Currently, Mobile Banking uses one ofthe following to provide mobileapplications:

1. IVR (Interactive Voice Response)

2. SMS (Short Messaging Service)

3. WAP (Wireless Access Protocol)

4. Standalone Mobile Application Clients

• IVR – Interactive Voice Response

In this, banks have to allot a specificnumber which customers call to reach anelectronic message stored in advance.Customers reach a menu and can choosethe options by pressing a number on thekeypad and this provides the necessaryinformation. However, this can only be



used for enquiry and is relatively moreexpensive as it involves voice calls.Keeping this in mind, banks should optfor technology based services as ‘onebutton banking’ could very well be thefuture.

• SMS – Short Messaging Service

This is by far the most popular standardto implement mobile banking. Thecustomer can send an SMS to a pre-specified number with the query and thebanks can reply with the relevantinformation. For example the customercan send an SMS regarding the balanceavailable in his account to which thebank generates the appropriateinformation. However, one of the primedisadvantages is security. Unlesspassword enabled or encrypted, thistype of sensitive information should berefrained from sharing as SMS facilityand SMS gateway is available on allmobile phones.

• WAP – Wireless Access Protocol

Banks can maintain WAP sites which areaccessible using a WAP compatiblebrowser on the customer’s mobilephones. Thus WAP sites can providesignificant security which further enablescustomers to access or carry outtransactions, information, trade etc.

A WAP based service pre-requires aWAP gateway. Customers use thebank’s site through the WAP gatewayto carry out transactions, receiveinformation etc.

• Standalone Mobile ApplicationClients

These are the most promising of the lotas they can be customized to suit theneeds of complex banking activities andis secure and reliable.

However, this customization can becomea major disadvantage of as theapplications needs to be customized foreach mobile phone.

In India, Reliance Infocomm which is thelargest CDMA player in the market has7 million users who have handsets whichsupport J2ME.

4 R of Mobile Banking

The 4 R – Run rate, Risk, Reputation andRegulation has been coined by ProbirRoy.

In 2008, the RBI issued guidelines formobile banking and since then, around30 banks were given clearance to offermobile banking facility to theircustomers. The average monetary valueof transactions used in mobile bankingis in tune of Rs. 150 crore. As mobilebanking is still in its inception stage, itwould be unfair to comment on itssuccess or failure. However, followingis a brief overview on the 4 R’s of mobilebanking.

• Run rate

Past experience shows that the run ratein mobile based transactions has been 6times but customer related transactions,

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also known as pure banking, has grownalmost 10 times. The growth has beenremarkably high but we should also keepin mind that the initial base has been quitelow thus leading to larger growth.Nevertheless, mobile banking has grownby nearly 100% per month.

SBI has the largest number of activemobile customers and the bank expectsits customer base to reach 1 million soon.Strategically also for any bank, movingto mobile banking and engaging highertechnology will prove to be fruitful in thelong run.

• Risk

Risk associated with the concept ofmobile banking is of course high but it isalso related to the performance of thehandset. Trust and Faith reduce riskinessto a large extent in any financial productand the chargeback rate has been zero.

Mobile Banking threats can be largelymitigated by the solution that is providedby the bank or the authorized securitycompany. A layered technique has provedsuccessful in supporting the technologythat is used for such applications.

Security should be concerned with mainly2 things:

• Sensitivity of the data

Sensitive data like credit cardnumbers, account numbers etc.which is confidential information toa client.

• Opportunity to access the data

Ensure the safety of the medium, itssusceptibility to external malware,proper encryption secure data pathsetc.

Following are some of the precautionsthat should be taken:

1. Resetting password or Pin overSMS to customer should not beused as the only method ofaccessing accounts or changingsensitive information.

2. If WAP is used, the devices shouldbe capable of encryption and allother devices should be deniedaccess.

3. There should be proper means toverify the customers’ device priorto transactions being accepted.

4. There is mostly partial encryptionof information in a transaction.Additional data encryption shouldbe implemented and also existingencryption should be checked forpossible cracks.

5. Most banking applications havebeen subject to hacking or malwareattacks. The technology usedshould be able to tackle suchhacking attacks and prevent theleakage of important and sensitiveinformation.

6. PBX systems have devicesconnected to collect transactions.



Wireless devices are thus nowbeing connected to these systemsby the hacker or thief to gainaccess to information. This needsto be addressed immediately.

7. Wireless technology, if notpassword protected or encrypted,can easily be broken into and usedto steal information.

8. Dynamic keys should be used formobile users which give a uniqueID to users to prevent possibletheft.

• Reputation

In a high risk application, reputation andbrand perception becomes veryimportant for financial transactions. Thebrand has to concentrate on connectingwith the customer, winning their trust,emphasize on the benefits received by thecustomer and encourage usage.

This can be validated by the AC Nielsenstudy done in 2009 where ‘Pay-Mate’was the preferred brand with 40 per centof market share.

• Regulation

Regulation is not seen with a kind eye aslong as market forces are concerned.They are considered to interfere with thenormal working of the market.

However, regulation in mobile bankingbecomes very important as it creates anenvironment which enables an effectiveworking condition for such applications.

Some facilitating measures have also beenundertaken like directives andpermissions relating to security, specifyingtransaction limits etc.

Also it seems that mobile banking andfinancial services can go down the samepath as by the mobile recharge coupons.Ease and convenience would be thedriving factors in this case.

Thus, the 4 R as given by Probir Roy willbe fundamental in deciding the success andgrowth of mobile banking but it will mostdefinitely emerge as the preferred optionthan online banking and credit cards.

Advantages of Mobile Banking

Probably the biggest advantage to banksthat mobile banking offers is the reductionin costs to provide service to customers.The cost associated with electronictransactions is as low as $0.10. Further,it opens up the opportunity for banks tocross sell their products and financialservices like credit cards etc.

Even for service providers, mobilebanking offers a win-win situation. Insaturated markets in the developed worldlike Korea, mobile penetration is not soattractive. Mobile banking can now helpincrease revenues. To provide betterservice to customers, service providerscan now share information to customersregarding the time and value of purchaseon their mobile phones. This will also helpreduce credit card fraud. Along the samelines, banks can set reminders forcustomers regarding their upcoming loan

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repayments or send copies of bills. Thecustomer would simply authorize paymentthrough their mobile phones.

The customers can also request forspecific information like stop cheque orto view deposit details etc using hismobile phone.

Thus mobile banking helps banks not onlyto reduce costs, but provide services tocustomers at lower costs. This will helpin customer profiling.

Further convenience becomes veryimportant as a mobile is carried by thecustomer most of the time and frequentvisits to the bank or ATM are not required.Footfalls will reduce thus leading to lessoperational costs in terms of employeecosts. Phone based credit systems cansoon be a reality in the near future thuswidening the benefits received due tomobile banking..

Automation thus helps banks topersonalize their services. For example,if the customer requires his accountbalance after completing a transaction, anautomated reply can be sent.

Hence it is important to analyze thebusiness benefits of mobile banking.

Business Benefits

••••• Robust Inclusivity Framework

Mobile Banking has tremendous scopefor financial inclusion. It can enable banksto include its diverse customer segmentsfrom corporate to high net worth

individuals, from unbanked groups to itshigh valued customers. It helps overcomethe problems associated with diversity oflocation, differentiated mobile phones, farflung branches etc.

••••• Maximize Innovation

Rapid innovation helps to configurevarious services from any channel to amobile. There will be instant delivery offinancial services to customers on mobilephones with the new improved features.Therefore, innovation is the backbone fora mobile banking interface. Growingcompetition can be tackled by constantupgradation and innovation.

••••• Robust Security

Mobile Banking will require goodsecurity with proper encryption and agood referral system in place. This willenable banks to offer complex financialservices with a robust security network.A two factor or multi factor encryptionwith authentication ensures a safe securitynet enabling banks to protect its customersfrom the security threats and attacks inmobile transactions.

••••• Cost Savings

There is significant cost savings attachedfor the banks as already discussed. Themobile banking business model isindependent of the service provider of thecustomer, thus reducing the necessity toopt for a revenue sharing model withthem. Thus, it is attractive for banks toopt for mobile banking.



••••• Customer Delight

Mobile banking offers convenience andease of banking to customers usingvarious technologies. Customerconvenience has assumed primeimportance as it enables customers tomake queries regarding accountbalances, impending loan repayments etcanytime anywhere. Banks can share anddisseminate information in a secureframework

• Increase market penetration

Mobile banking goes a long way inreducing costs and helps increasepenetration of services especially in ruralareas. Mobiles can now be used as cashand credit cards and enable merchantsfor faster and safer transactions. Itreduces the need to carry plastic moneyor cash. It also reduces the need tophysically access a service point of abank.

• Sell more services to existingcustomers

Mobile Banking helps understand andaddress the latent demand amongcustomers. The mobile could then beused as a new functionality or as adifferent way to interact through the useof technology.

• Retention of most valuablecustomers

It helps retain the most profitablecustomers who bring in the most business.

This will ensure that they do business withthe banks and reduce the chances of themmoving to a different bank. Banks canmake technology and innovation theircore competency as it would be inimitableand difficult for competitors to copy.Banks can thus extend the concept ofease of banking and convenience to allits products through mobile bankingtechnology.

Some Success Stories

1. LG Telecom, South Korea

South Korea has been the leader inpioneering the evolution and introductionof technology in services. LG telecomwas the smallest of the mobile serviceproviders in South Korea when itcollaborated with Kookmin bank andlaunched what came to be known as‘Bank on’ service. Smart chips wereinserted into mobile phones so thatcustomers could access all transactionand enquiry based queries. The chiphelped in authentication and identificationand made the process more streamlined.Further, these chips began to be used ascash cards. Thus, today, users use theirmobile phones to pay for travelling oreating at a restaurant.

2. Reliance Communications

Reliance has decided to introduce moneytransfer facility on reliance mobile phoneswith a joint venture initiative with ICICIBank. This is considered an easieralternative to account to account transfer

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of funds within banks. R Comm haspegged the volume of money transfer at$24 billion annually. This tie up is strategicto Reliance and ICICI as it will help theirexisting customers to transfer moneythrough mobile phones and encourage theusage of each others services. Thus thisshows a wonderful way of cross sellingand tie- ups in mobile banking sector.

3. ABN Amro, India

This organization uses an applicationcalled MPOWER which lets itscustomers’ access account informationthrough SMS. Other services providedare balance and transaction inquiries,Cheque Inquiry and Stop Cheque,Change Pin, Presentation of Bills andPayment etc.

Therefore, ABN Amro has successfullylevered on the mobile banking technologyto provide to its customers a betterbanking experience.

Disadvantages of Mobile Banking

• Insecurity

Mobile banking is considered to besafer than online banking as it isprotected from viruses and Trojans.However, mobile banking has its ownthreats most significant among thembeing ‘smishing’. A customer receivesa fake SMS asking for the details ofhis account number etc. seemingly froma bank. Many such cases have beenreported and money from accounts hasbeen stolen due to this.

The security of confidentialinformation and safety of transactionsconducted needs to be addressed mosturgently by mobile phone companies,service providers and banks. It is veryimportant to check:

1. That the mobile phone is insecure hands

2. The requirement of ID/Passwordin the event of theft or loss ofthe mobile device.

3. Proper Authentication of thecustomer/user before anytransaction or inquiry.

4. Encryption of data.

5. Encryption of data stored inbanks and in the mobile device.

6. Usage of One time Password toprevent fraud.

Thus the above points should be givenserious thought for safe mobilebanking.

• Compatibilitywallet and mobilephone image by Pavel Bernshtamfrom Fotolia.com

Mobile Banking is not supported in justany handset and in India one requires asmart phone or a RIM Blackberry to availof these services. Some of the handsetshave no option of mobile banking at all.Banking application services are availableonly on RIM and Apple I Phones.Further, the advanced facets of mobilebanking are only available on high endsophisticated phones.



• Cost

Network service charges are expensive.The costs associated to mobile bankingmay not be substantial in the presence ofan existing compatible device, butcharges for data and text messaging arequite high. Some financial institutionscharge a premium fee for mobile bankingservice and for the software. These costscan be very high if there is frequent usageof mobile banking services.

• Handset operability

A variety of mobile handsets makes itdifficult to offer mobile banking servicesof uniform nature on these devices. Theysupport different application like JAVAME, SMS or WAP.

Primary Research Data Analysis

Following is the result of the researchconducted by the researcher toinvestigate the awareness level andpopularity of Mobile Banking among apopulation sample of 100 people in IBS,Hyderabad and its surrounding area.

The women respondents were 31% andmale respondents were 69% in thesample taken.

Objective

The respondents were asked questionson various facets of Mobile Banking togauge the awareness level, frequency ofuse and willingness to pay a premium forsuch services.

Methodology

A questionnaire has been developedkeeping in mind the informationrequired from the respondents. It coversvarious fields such as familiarity with thevarious services of Mobile Banking tothe frequency of use, amount topremium willingly paid to avail suchservices and also to understand thedemographics of the sample populationwho typically use this service. Thequestionnaire has been attached inAnnexure.

Analysis of Data

The distribution of monthly income ofthe respondents has been shown in thefollowing chart. This data will revealfurther interesting facts associated withmobile banking usage. However, thedrawback has to be kept in mind thatrespondents by human nature do notlike to reveal their actual income andas such the data could be understatedor overstated.

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It also becomes necessary to analyze andunderstand the sample population fromthe point of view of the profession of therespondents. This will help understandthe distribution of monthly income betteras well.

Following is the comprehensive result ofthe sample population as regards theprofession.

thing is that students have reported noincome as expected. So we can directlyattribute the 36% of no incomerespondents to the students.

Most of the respondents have given apositive response to the awareness ofMobile Banking as can be seen thatnearly 90% of the respondents have givenan affirmative answer. 8% have said ‘No’whereas 2% have said ‘Don’t know’.

Therefore, the maximum respondents aresalaried respondents followed by studentsand self employed people. The interesting

Another interesting result was that nearly80% respondents said that their banksoffered mobile banking services, 5% saidtheir bank did not and 15% said they didnot know. However, on analyzing thisinformation with the data of usage ofmobile banking, startling facts were seen.Out of the 80% respondents whosebanks offered mobile services, 77% saidthey use these services. Rest replied inthe negative. This helps to realize that thereis a gap in the awareness and usage of



mobile banking which providesopportunity for banks to meet.

Frequency of usage also showed mod-erate results with around 38% respon-dents saying their usage is ‘Regular’, 39%saying ‘Occasional’ usage and 23% say-ing ‘Never’. Moving on its important tounderstand the perceived benefits and dis-advantages associated with mobile bank-ing. ‘Convenience’ scored the highest interms of advantages perceived bothamong those who have used mobilebanking (43%) and the non users (12%)and the most disadvantageous aspect wasconsidered to be ‘Insecurity’.

Thus, Cost saving was leastadvantageous with 7% and 4% amongusers and non users respectively. TimeSaving was also considered importantwith 27% respondents and 7% of the nonusers giving it importance. Following isthe Perceived disadvantages associatedwith Mobile Banking Services amongusers and non users.

Insecurity scored 57% and 11% amongusers and non users respectively followedby High network costs (18% for usersand 8% for non users) and Complicated(2% for Users and 4% for Non Users).

As expected respondents associated highrisk (almost 95% of respondents)associated with mobile banking andplaced the most importance on reputation

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of the banks (88%). This shows thatamong the sample population, Risk is avery important factor which can to someextent be mitigated by the reputation ofthe bank offering the mobile bankingservices.

The most used mobile banking serviceaccording to the sample population wasfor account information (57%) followedby support and information (13%) andleast was for brokerage and investmentat (7%). Among non-users also, theperceived services to be used wasaccount information (17%) followed bysupport and information (4%) andbrokerage and investment (2%).

Most of the respondents (83%) agreedto pay a premium to avail mobile bank-ing services. The respondents it seemschose the middle path and indicated thatthe premium they were willing to pay wasin the range of Rs.11 to Rs. 20 (around63 %). It has been shown in the follow-ing chart.

Thus, this data analysis shows a highpotential for banks to introduce mobilebanking provided there is adequate securityand infrastructure in place. There is a highprobability for non users also to beconverted to users as well. The users andnon users are aware of the benefits and costsassociated with these services and are willingto pay a premium as well. Thus with properrisk management, good reputation and runrate, and secure regulations, mobile bankingcan serve a huge customer base.

Conclusion

Mobile banking is a relatively newconcept and thus it requires some time tocatch on. The advantages greatlyoutnumber the disadvantages and wouldprove profitable for the banks given thewillingness to pay premium by thecustomers. Banks should invest inupgradation of technology andinfrastructure to provide adequate securityand ease of transactions etc. With mobilephones becoming a necessity andincreasing penetration, banks can tie upwith service and handset providers as well.

Thus, I can conclude that Mobile Bankinghas high Risk but with proper Regulationand Reputation, the Run Rate of the bankscan be significantly improved.



1. Do you know about the conceptof Mobile Banking?• Yes• No• Don’t know

2. Does your bank offer the servicesof Mobile Banking?• Yes• No• Don’t know

3. Have you ever used MobileBanking?• Yes• No• Can’t Say

4. How frequently i.e. how many timeshave you used Mobile Banking?• Never• Occasionally• Regularly

Annexure

Questionnaire

Name: Age:

Gender: Profession:

Avg. Monthly Income:

5. What do you perceive are theadvantages of Mobile Banking?• Convenience• Cost saving• Time Saving

6. What do you perceive are thedisadvantages of Mobile Banking?• Insecure• High network cost• Complicated

7. What is the risk (as perceived byyou) associated with MobileBanking?• Low Risk• Moderate Risk• High Risk

8. How important is the reputation ofthe Bank for you to opt for MobileBanking?• Not Important• Important• Very Important

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9. Which service of mobile bankingdo you use most frequently?• Account Information• Support and Information• Investment and Brokerage

10. Are you ready to pay a premiumto avail mobile banking services?• Yes• No

11. How much premium?• None• Rs.1 – Rs.10• Rs.11 – Rs.20• More than Rs. 21

References

• Author, Anon (n.d.). MobileBanking [www page.] URLhttp://en.wikipedia.org/wiki/Mobile_banking

• Author, Anon (n.d.). Tutorial –Reports.com [www page.] URLhttp://www.tutorial-reports.com/m o b i l e / m o b i l e - b a n k i n g /advantages.php

• Author, Anon (n.d.). MobileBanking [www page.] URLhttp://www.infosys.com/finacle/solutions/solutions_mobile.asp

• Author, Anon (n.d.). MobileBanking Benefits with Clickatellhttp://www.clickatell.com/solutions/financial_services/financial_services_benefits.php

• Author, Foster (n.d.). TheDisadvantages of Mobile Banking[www page.] URLh t t p : / / w w w . e h o w . c o m /list_6683378_disadvantages-mobile-banking.html

• Author, Mobile MarketingAssociation (2009) MobileBanking Overview [on-line serial]URL http://www.mmaglobal.com/mbankingoverview.pdf

• Author, Buse, Herstatt,Tiwari,(2006) Mobile Banking AsBusiness Strategy: Impact OfMobile Technologies OnCustomer Behavior And ItsImplications For Banks [on-lineserial] URL http://www.global-innovation.net/team/tiwari/PDF/Working_Paper_37.pdf

• Author, Roy (2010) Probir Roy:The 4 R of Mobile banking [wwwpage.] URLh t t p : / / w w w . b u s i n e s s -standard.com/india/news/probir-roy4-r%5Csmobile-banking/398434



MID-CAREER DERAILMENT: ANEMPIRICAL STUDY

Dr. Ipseeta Satpathy, D.Litt.Associate Professor

School of Management, KIIT UniversityMail: [email protected]

&Dr. B. C. M. Patnaik,

Associate ProfessorSchool of Management, KIIT University

Mail: [email protected], [email protected]

Abstract

This paper makes an attempt to know the various reasons for which themid life crisis comes in the life of an employee. No person would be mentallyready to get this unwanted and that to unexpected crisis. However, during thestudy we found certain gaps between the expectations of the employers andperformance level of the employees which contributes a lot in this direction.Through this paper we tried to touch certain issues which would help to someextent for controlling the crisis. To understand the ground reality, a survey wasconducted in both the organized and unorganized sectors. 200 questionnaireswere distributed of which 118 responses were received.

Key words- Career derailment, Perception, Employee

INTRODUCTION

Mid-career derailment can happenany time, but in times like today, thereis no room for complacency. Thepeople who have been studyingderailment for many years estimate thatbetween 20 to 50 percent of highpotential managers will get derailedalong way. Hence, an employee needsto either do something to avoid such a

situation or if it has already occurred,needs to control to get back into thenormal track again. This is uniquephase in an employee’s career or inbetween the career when theemployee experiences a decline in his/her performance and struggles inmeeting the organization’sexpectations. For a talented employee

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this may happen due tooverconfidence, reluctance to adapt tothe nature of job, arrogance or feelingof inferiority or superiority. This maybe also be possible that when anemployee, after some years of highgrowth sees his /her career stalling;this may be due to the loss ofmotivation or getting into a role notaligned to his/her intrinsic strengths.This may also be because ofunwillingness to adapt to the changesand sometimes also due to themismatch of skills.

OBJECTIVE OF THE STUDY

� To understand the employees’perception towards the variousquestions related to the mid-career derailment

� To suggest some corrective stepstowards this issue.

LIMITATIONS OF THE STUDY

� The study is limited toBhubaneswar, Odisha

� The sample size is limited; it maynot give the exact picture.

� The period of study is for 3months, that is, August 2011 toOctober 2011.

SAMPLE &METHODOLOGY OFTHE STUDY

For the purpose of the study, 200questionnaires were distributed and thesampling technique adopted was StratifiedRandom Sampling. Finally, 118 responseswere received, which includes 42 femalerespondents. For the purpose of thesurvey, employees from both organizedand unorganized sectors were selected.Simple percentage method was followedfor presenting the data in a simple way.

Respondents on the basis of age group

Age group Frequency Percent Cumulative percent

Less than 20 24 20.34 20.34

20-30 37 31.36 51.70

30-40 28 23.73 75.43

40-50 16 13.56 88.99

More than 50 13 11.01 100

Total 118 100

Source: Compiled from field survey

Mid-career derailment: An Empirical Study


Respondents on the basis of educational back ground

Education Frequency Percent Cumulative percent

Less than 10th class 57 48.31 48.31

Under graduates 49 41.53 89.84

Post Graduates 12 10.16 100

Total 118 100

Source: Compiled from field survey

FINDINGS OF THE STUDY

1. Do you believe that a decline in the performance of the employee causesderailment?

Gender F CA % A % N % DA % CDA %

Male 76 49 64.47 10 13.16 1 1.3 9 11.84 7 9.23

Female 42 27 64.29 8 19.05 2 4.76 3 7.14 2 4.76

Total 118 76 18 3 12 9

Source: Compiled from filed survey, F- Frequency, CA-Completely Agee, A-Agree, N- Neutral,DA- Dis Agree & CDA- Completely Disagree.

Interpretation: Responding to this 64.47% of male and 64.29% of female com-pletely agreed. Only 11.84% of male and 7.14% of female did not agree. Similarly,9.23% of male and 4.76% of female did not agree.

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2. Do you think that mismatch of skills a person possesses and skills required tocomplete a task is one of the reason for derailment?


Male 76 38 50 9 11.84 5 6.58 14 18.42 10 13.16

Female 42 26 61.90 8 19.05 3 7.14 3 7.14 2 4.77

Total 118 64 17 8 17 12

Source: Compiled from filed survey, F- Frequency, CA-Completely Agee, A-Agree, N-Neutral,DA- Dis Agree & CDA- Completely Disagree.

Interpretation: Answering to this 50% of male and 61.90% of female completelyagreed. 6.58% of male and 7.14% of female were neutral and rest belongs to otherremaining category.

3. Do you agree that when a person struggles in meeting organizational expecta-tions causes the derailment?


Male 76 41 53.95 13 17.11 6 7.89 6 7.89 10 13.16

Female 42 24 57.14 9 21.43 3 7.14 4 9.52 2 4.77

Total 118 65 22 9 10 12




Interpretation: Participating to this question 53.95% of male and 57.14% of femalestrongly supported the view. 13.16% of male and 4.77% of female completely disagreedand rest joined the other category.

4. Do you agree that hardening of attitude with time and lack of flexibility and learnability of employee causes the derailment?


Male 76 27 35.53 12 15.79 6 7.89 15 19.74 16 21.05

Female 42 22 52.38 9 21.43 4 9.52 4 9.52 3 7.15

Total 118 49 21 10 19 19


Interpretation: Joining to this query, 35.53% of male and 52.38% of female completelyagreed. 19.74% of male and 9.52% of female disagreed to this.

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5. Do you believe that due to over confidence of the employee causes thederailment?


Male 76 32 42.11 17 22.37 7 9.21 12 15.79 8 10.52

Female 42 31 73.81 6 14.29 3 7.14 1 2.38 1 2.38

Total 118 63 23 10 13 9


Interpretation: Responding to this 73.8% of female, 42.11% of male completelyagreed. 9.21% of male and 7.14% of female decided to be neutral and rest belongs toothers.

6. Do you agree that when the employee gets in to the role not aligned to theperson intrinsic strength causes derailment?


Male 76 34 44.74 18 23.68 8 10.53 10 13.16 6 7.89

Female 42 29 69.05 6 14.29 2 4.76 3 7.14 2 4.76

Total 118 63 24 10 13 8




Interpretation: Answering to this 44.74% of male, 69.05% of female supported theview completely. 13.16% of male and 7.14% of female disagreed. 4.76% of femaleand 7.89% of male completely disagreed.

7. Do you believe that reluctant to adapt to the nature of business or job one of thereasons?


Male 76 27 35.53 15 19.74 7 9.21 17 22.37 10 13.15

Female 42 31 73.81 4 9.52 6 14.29 1 2.38 - -

Total 118 58 19 13 18 10


Interpretation: Responding to this 35.53% of male and 73.81% of female completelyagreed. 22.37% of male and 2.38% of female disagreed.

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8. Do you feel that loss of motivation/ passion causes the derailment?


Male 76 43 56.58 10 13.16 6 7.89 7 9.21 10 13.16

Female 42 32 76.19 6 14.29 4 9.52 - - - -

Total 118 75 16 10 7 10


Interpretation: Participating to this 76.19% of female and 56.58% of male completelyagreed. From the female side there were no respondents for disagree and completelydisagree.

9. Do you agree that due of arrogance of the employee sometimes causes thederailment?


Male 76 54 71.05 9 11.84 8 10.53 3 3.95 2 2.63

Female 42 26 61.90 6 14.29 5 11.90 4 9.52 1 2.39

Total 118 80 15 13 7 3


Interpretation: Joining to this 71.05% of the male and 61.90% of female agreedcompletely. Only 2.39% of female and 2.63% of male completely disagree.



10. Do you believe that feeling of being inferior / superior causes derailment?


Male 76 58 76.32 7 9.21 6 7.89 3 3.95 2 2.63

Female 42 31 73.81 6 14.29 3 7.14 2 4.76 -

Total 118 89 13 9 5 2


Interpretation: Responding to this 76.32% of male, 73.81% of female completelyagreed. 2.63% of male and no respondents from female category towards completelydisagree.

97

Suggestions:

� Ask for immediate feedback fromthe people around you. It is veryimportant to assess yourcapabilities and gaps you need towork on and accept them.

� Be rooted and pay attention to theorganization’s culture anddynamics. You will be surprisedhow both change without anynotice.

� Display empathy and be sensitiveto people.

� Break out of the rut, Learn fromthe mistakes that you and othermake.

� Be introspective of which stage ofyour career you are in, the hungerto learn and evolve has to persistwithin.

CONCLUDING NOTE

Career derailment is a process. It doesnot happen overnight, and it can beprevented, interrupted in many cases.One must get into roles, which are alignedto one’s strengths and interests. Also, onemust maintain a flexible and learningorientation, and should be able to relaxand maintain emotional equanimity. Theperson who is already hit should be highlycommitted towards making the necessarychanges to get back into the normal track.These setbacks or failures are a learningprocess. It is important to honestly

analyse the root causes. It is important tothink deeply on what really interests theindividual and what his/ her strengths are,and whether the current role utilizes them.Having supportive mentor may be veryhelpful in doing this analysis and installingconfidence in the individual. Then, oneshould make a plan to get back on thenormal track. This may mean a lateralmove within the organisation or movingto other role outside the current company.In both the cases, the individual shouldtake care to see that role requirementsare aligned to one’s strengths andinterests. Hence, if the employee carriesthe right attitude and passion towardswork and is open to learning, he/she willnever be on the edge of career crisis,rather would move towards success.This Success is like a train, it hasseveral coaches like hard work, focus,luck, attitude and vision. But, leadingall these, there is the engine ofConfidence. So have a confidence onyour potentials.

REFERENCES:

� Mendenhall,R, Kalil,A, Spindel,L.J & Hart C.M.D (2008)- JobLoss at Mid Life: Managers andExecutives face the “ New RiskEconomy”, Social Forces, 87(1)185-209.

� Kaufman, Harold G (1982)-Professional in search of work:Coping with the stress of job lossand underemployment, New York:Wiley



� Creed P.A & Moore K (2006)-Social Support, Social underminingand Coping in underemploymentand unemployed persons. Journalof Applied Social Psychology,36(2), 321-339.

� Fryer, David and Payne & Roy(1984)- Proactive behavior inunemployment; Findings andimplications, Leisure Studies, 3(3):273-295

� Gowan M.A & Gatewood R.D(1997)- Model of response to thestress of involuntary job loss,Human Resource ManagementReview, 7(3); 277-297

� The Mid Career Derailment-Corporate Life, article published inAscent, Time of India, on 29/11/2011.

��

99

Notes to ContributorsThe journal will include thematic and empirical research papers in the field ofBusiness Management and allied areas, with emphasis on pragmatic orientation.

Before submitting the paper for publication, please ensure that this paper has notbeen sent for publication or published elsewhere, until you receive a communicationfrom our side. Once a manuscript is submitted for publication, it will be screenedby the editorial board to check:1.fitness of the paper for publication in the journal,& 2.originality/ plagiarism (through software).

After the preliminary screening it will then be blind-reviewed by two independentnational/ international reviewers, for the scientific merit, readability and interest.Unaccepted manuscript will not be returned; however, you will be communicatedaccordingly.

Accepted authors will be given one hard-copy of the journal and one soft-copy.

The manuscript should be neatly typed in double space on an A-4 sheet with 1inch space on all sides in 12 Times Roman size font. The manuscript should be ofmaximum up to 5500 words, or 20 pages.

The references, as illustrated below, should be in American PsychologicalAssociation (APA) format, 5th Edition:

Reference from Journal:

Alkaike, H. (1987). Factor analysis and AIC. Psychometrica, 52, 317-332.

Reference from Edited book:

Browne, M. W. & Cudeck, R. (1999). Effects of Organizational Climate andCitizenship Behavior on Organizational Effectiveness. In K.A. Bollen & J.S. Long(Eds.) Human Resource Management (pp. 136-147). Newsbury Park, CA:Sage.

Reference from Book:

Luthans, F. (2002). Organisational Behaviour. New Delhi: McGraw-HillInternational.

Booth, W. C., Colomb, G. G., & Williams, J. M. (1995). The craft of research.Chicago: University of Chicago Press.

Reference from online resources:

Hacker, D. (1997). Research and documentation in the electronic age.Boston: Bedford Books. Retrieved October 6, 1998, from http://www.bedfordbooks.com/index.html

Morse, S. S. (1995). Factors in the emergence of infectious diseases.Emerging Infectious Diseases, 1(1). Retrieved October 10, 1998, from http://www.cdc.gov/ncidod/EID/eid.htm

Smith, E. E. (2001). Internet term paper mills: The case for mandatory expulsion[Electronic version]. Journal of Crime and Punishment, 6, 123–139.

Newspaper Article

Goleman, D. (1991, October 24). Battle of insurers vs. therapists: Cost controlpitted against proper care. New York Times, pp. D1, D9.

Newspaper Article (Online)

Markoff, J. (1996, June 5). Voluntary rules proposed to help insure privacyfor Internet users. New York Times. Retrieved April 1, 1996, from http://www.nytimes.com/library/cyber/week/yo5dat.html

Newspaper Article (No Author)

Undisclosed settlement reached out of court in Michigan Biodyne civil suit. (1992,March 1). Psychiatric Times, p. 16.

Conference Paper (Published):

Kuroda, S. Y. (1988). Whether we agree or not: A comparative syntax of Englishand Japanese. In W. J. Poser (Ed.), Papers from the second internationalworkshop on Japanese syntax (pp. 103–143). Stanford, CA: CSLI.

Dissertation:

Downey, D. B. (1992). Family structure, parental resources, andeducational outcomes. Ph.D. dissertation, Department of Sociology, IndianaUniversity, Bloomington, IN.

Checklists to be adhered to:

1. Cover Letter with a note on Title of paper, with contributor(s)’ completeaddress.

2. Abstract of 100-120 words, with title of paper (in Separate Sheet/ page)

3. Full-text of article (with title of paper, but not with authors name/ affiliation)

4. Tables and figures/ graphs should be given in the end.

Manuscript Submission:

Please email all manuscripts only in MS-word/ RTF format to:[email protected]

Inquiries for current and back issues:

The queries can be addressed to:

Editor, Parikalpana (KIIT Journal of Management),

School of Management,

KIIT University, Bhubaneswar – 751024

ODISHA, India

Or, email the soft copies to: [email protected]

How to Subscribe KIIT Journal of Management ?

The journal can be subscribed by sending the filled in form with appropriatedemand draft of any nationalized bank drawn in favor of KIIT University,Bhubaneswar, payable at Bhubaneswar. Please add Rs. 50 for outstation cheques.The subscription fee includes mailing charges.

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KIIT Journal of Management

Volume-7 2010-11

Contents

About the Journal

� A Study on Consumer Perceptions and Expectationsfor Tata NanoDr. Garima Malik 1-10

� Impact of Employee Trust on Organizational Commitment andInnovative Behaviour of Employees: An Empirical Study onPublic Sector Employees in BhutanMd. Hassan Jafri 11-26

� An Empirical Study of Employee Empowerment and InformationSharing in Manufacturing and Service Sector Organizations inMumbai & PuneDr. Shaju George 27-41

� A Critical Analysis of the Role, Importance and Implicationsof Case Study Method of Teaching for MBA Students atSchool of Management, KIIT UniversityAnsuman Jena, Biswajit Das & Prakash Kumar Pradhan 42-59

� Impact of Mining on Tribal LivelihoodAnil Ota 60-71

� Mobile Banking in India: An Empirical Study in theCity of HyderabadDr. Suresh Chandra Bihari 72-87

� Mid-Career Derailment: An Empirical StudyDr. Ipseeta Satpathy & Dr. B. C. M. Patnaik 88-98

A STUDY ON CONSUMERQuestionnaire and the In-depth Interviews through the questionnaire with the...

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