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July - September, 2012
ISSN : 2277-6753
Society,
Vol. 1, No. 4 October - December, 2012

Referred Journal of CMR College of Engineering & Technology
1. Introspection of Women Entrepreneurs : A Garrette’s Approach

- Dr. Y.V.S. Subrahmanya Sarma, Dr. A. Kondaiah Swamy
SUMEDHA JOURNAL OF MANAGEMENT

2. Impact of the Direct Tax Code on Different Income Group of Assesses
– Dr. Vikas Kumar, Dr. Sohan Lal Yadav
3. An Empirical Study on Occupational Stress among the Employees of Telecom Industry

– Dr. P. Paramanandam
4. Performance Management System in a Manufacturing Company

A Study From Employee Perspective
–Dr. Sitansu Panda
5. Service Sector’s Contribution to The State Economy : A Study of Nagaland

– Dr. N. Martina Solo, Peteneinuo Angami
6. Key Dimensions of Employee Engagement : A Study on Hyderabad Organized Retailing

– Urmila Jagadeeswari Itam, Dr Sapna Singh
7. Impact of FDI on Retailing : A Multi Dimensional Approach

- Mrs. Sudha Vemaraju
8. Strategy Preceeds Structure Vs Structure Preceeds Strategy for Purchase Decision of

Volume. 1 Consumers : A Study on Food Retail Stores in Semiurban Areas of Andhra Pradesh
– Srivalli Jandhyala
9. Quality of Work Life in State Bank of India, Hyderabad

- Mr. K. Veeraiah, Dr. G. Manchala
Number 4
10. Radio Taxi Services in Jaipur: A Learning Experience from Meri Car
– Dr. Makarand Upadhyaya
Indexed in ProQuest DataBase

CMRCET
Mr A Kotishwar,
Retired
Prof. T.L.N Swamy : Head Dept. of Economics, Osmania University.

Dr. P T Choudhary : Executive Vice President , All India commerce Association &
Head, Dept of Commerce, M J College, Jalgaon.
Volume 1 October-December, 2012 Number 4
RESEARCH PAPERS
1. Introspection of Women Entrepreneurs : A Garrette’s Approach 4
- Dr. Y.V.S. Subrahmanya Sarma, Dr. A. Kondaiah Swamy
2. Impact of the Direct Tax Code on Different Income Group of Assesses 13
– Dr. Vikas Kumar, Dr. Sohan Lal Yadav
3. An Empirical Study on Occupational Stress among the Employees 20
of Telecom Industry
– Dr. P. Paramanandam
4. Performance Management System in a Manufacturing Company 31
A Study From Employee Perspective
– Dr. Sitansu Panda
5. Service Sector’s Contribution to the State Economy : A Study of Nagaland 41
– Dr. N. Martina Solo, Peteneinuo Angami
6. Key Dimensions Of Employee Engagement : 55
A Study on Hyderabad Organized Retailing
– Urmila Jagadeeswari Itam, Dr. Sapna Singh
7. Impact of FDI on Retailing : A Multi Dimensional Approach 62
- Mrs. Sudha Vemaraju
8. Strategy Preceeds Structure Vs Structure Preceeds Strategy for Purchase 74
Decision of Consumers : A Study on Food Retail Stores in Semiurban
Areas of Andhra Pradesh
– Srivalli Jandhyala
9. Quality of Work Life in State Bank of India, Hyderabad 83
- Mr. K. Veeraiah, Dr. G. Manchala
10. Radio Taxi Services in Jaipur: A Learning Experience from Meri Car 92
– Dr. Makarand Upadhyaya
Chief Editor Message
As we move forward, I look forward to the momentous growth of our Journal, increasing
in their appeal, readership and relevance to the fast-changing world of Business Management.
During this one year our journal has been critically evaluated by various institutions with similar
line of interest and faculty fraternity. We have been consistently seeking advice from experts to
continuously improve the quality of the journal. Our journal has been Indexed in ProQuest
Data base. On behalf of the Management, Editorial Board and Editorial Team, I express my
profound gratitude to all our authors, reviewers, readers and patrons for offering their
overwhelming support and I anticipate a continued and lively partnership for years to come.
The present issue deals with Quality of Work Life, Entrepreneurship ,FDI Impact of
the Direct Tax Code on Different Income Group of Assesses. Occupational Stress . Performance
Management System, Strategic management ,case study of Radio Taxi Services in Jaipur ,Service
Sector’s Contribution To The State Economy, A Study On Food Retail Stores, Employee
Engagement
All of us recognize the necessity for change, which results in progress. It gives way to
new ideas and perspectives reflecting the current and emerging environment, which builds on
the solid foundations of the past.
Last but not least valuable would be your response and suggestions on this issue. Kindly
send us your views so that we can keep on upgrading our journal.
Thanking you,
A Kotishwar
Chief Editor
SUMEDHA Journal of Management
Introspection of Women Entrepreneurs

A Garrette’s Approach
- Dr. Y.V.S. Subrahmanya Sarma*
- Dr. A. Kondaiah Swamy**
Abstract
Entrepreneurship among women is a recent phenomenon. In a developing country
like India, a favourable socio-economic environment could help in exploiting the latent
entrepreneurial talents among women. Women entrepreneurs are the women or a group of
women who initiate, organize and operate a business enterprise. The government of India
connotes women entrepreneurs as "an enterprise owned and controlled by a woman having
a minimum financial interest of 51% of the capital and giving at least 51% of the employment
generated in the enterprise to women". However, this been severely criticized on the condition
of giving employment to more than 50% of the total work force to women.
Conception of the idea is very important inspiring factor to entrepreneurs. The women
entrepreneurs should have proactive idea about their ability to boost of their performance.
How an entrepreneur feel about himself is an important criteria for his performance as an
entrepreneur. Risk is common in any business and risk taking is the primary requirement
of any entrepreneur. The entrepreneurs’ performance and success is totally depending on
the way the entrepreneurs perceive their risks in the business.
1. Introduction
In recent years for a developing country, entrepreneurship has been a new impetus for
economic development and growth. Entrepreneurship promotion and development have been
identified as one of the key components of the nation’s economic development strategy.
Entrepreneurial resource has been considered a crucial input in the process of this economic
development. Micro-entrepreneurial ventures are considered the most critical factor that would lay
the foundation in an economically struggling third world developing country 1. These entrepreneurial
ventures will help both the urban and rural population through creation of jobs, a rescue out of
unemployment and poverty and thereby impact upon developing skills, self-esteem and self sufficiency.
In this way, this will certainly contribute to the overall development of the economy. Entrepreneurship
among women is a recent phenomenon. In a developing country like India, a favourable socio-
* Head and Associate Professor, Department of Commerce, P.G. Courses & Research Centre, D.N.R. College,
BHIMAVARAM - 534 202, Mobile No. 94408 36027; Email ID: dryvsssarma@yahoo.co.in
** M.Com., M.Phil.,Ph.D, Lecturer in CCP, Government Polytechnic for Women, NANDIGAMA, Krishna District, Mobile
No. 98660 35185, Email ID: aks.addepalli@gmail.com
4
Vol. 1, No.4 October - December, 2012
economic environment could help in exploiting the latent entrepreneurial talents among women.
There are certain unfavourable conditions that often hinder the emergence of such entrepreneurial
talents. However, despite of these situational constraints, more and more women are today entering
the field of entrepreneurship in India.
Women entrepreneurs are the women or a group of women who initiate, organize and operate
a business enterprise2. The government of India connotes women entrepreneurs as “an enterprise
owned and controlled by a woman having a minimum financial interest of 51% of the capital and
giving at least 51% of the employment generated in the enterprise to women”. However, this been
severely criticized on the condition of giving employment to more than 50% of the total work force
to women.
2. Need for the Study

The development of entrepreneurship among women is major step to increase women
participation in economic development. It will enhance economic growth and provide employment
opportunities for women entrepreneurs. Providing economic opportunities for women can also
improve the social, educational and health status of women and their families. The women
entrepreneurs are doing well in the small business sphere. In this juncture, this study wishes to
explore the introspection of women entrepreneurs with the help of the Garrett ranking approach.
For the study of introspection, the study selected three components, such as conceive the idea of
doing business, the perception of women entrepreneurs on their entrepreneurial ability and the way
they are perceive and face the business challenges and risks.
3. Conception of the Idea

Conception of the idea is very important inspiring factor to entrepreneurs3. Entrepreneurs
may get the idea of doing this business in the discussion with other eminent people in the same field.
Some people inspired to become business men by reading books and magazines. Some entrepreneurs
may be interested to start the business for providing some important and scarce products by doing
the old business in new way. Some women do painting, embroidering, tailoring etc as hobby and
want to convert their hobby into the business to get profits or reputation. Some homemakers want
to utilize the waste material into useful products and they want to do the business their ideas. Like
that, entrepreneurs conceive the idea of doing the business, hence, the researcher made an attempt
to identify how the entrepreneurs conceive the idea and kept them in Tables: 1A and 1B.
For the analysis of the conceiving the idea of generating a unit, the researcher identified eight
concepts of conceiving the idea. The respondents ranked them in their preference of conception of
generating a business. Only one idea may not be the important concept to conceive an idea to start
a business. The conception is the result of the influence of various concepts but a few are very
important and some other are also have their influence on conceiving the idea. In general, women
have so many hobbies as they may be inculcated in the free times of their lives. The women who
5
expertise their hobby and further it may be converted into the business. This ‘converting hobby into
the business’ is the best concept of conceiving the business idea as it occupied the best place with
19489 Garrett points, whereas ‘looking through books’ occupied the second best option with 18994
Garrett points. The women are best examples of usage of unused or waste material for a purposeful
utility. It is evident from the table 1A and 1B that, ‘utility of waste material’ occupied third rank with
18950 Garrett points, whereas ‘brain storming’ occupied fourth rank with 18287 Garrett points.
Previous job experience of women entrepreneurs is not at all a helping concept of women
entrepreneurs for the business ideas as it stood at sixth place in the Garrett ranking approach.
4. Perception on their Entrepreneurial Ability

The women entrepreneurs should have proactive idea about their ability to boost of their
performance4. How an entrepreneur feel about himself is an important criteria for his performance
as an entrepreneur. In this juncture the researchers selected eleven abilities and asked the
entrepreneurs to rank them according to their experience.
Majority of the women entrepreneurs feel that their ‘ability to deal with the situation’ is the
most important talent they have for their success. And it is evident from tables 2A and 2B as it
stood at first rank with 19938 Garrett points and followed by ‘emotional ability’ of women
entrepreneurs stood at second ability with 19613 Garrett points. Communication skills or ability
helps the women entrepreneurs for their success in the business and it is proved in the study as it
occupied third rank with 19519 Garrett points and ‘drive and delineation’ of women entrepreneurs
occupied the fourth rank with 18769 Garrett points. It is proved that technical knowledge and vision
about the future are not at all useful talents to the women entrepreneurs with ability to deal with the
situation and emotional ability.
5. Perception of Business Risks

Risk is common in any business and risk taking is the primary requirement of any entrepreneur.
The entrepreneurs’ performance and success is totally depending on the way the entrepreneurs
perceive their risks in the business5. In this sphere, the study plans to collect the opinion of women
entrepreneurs on the business risks. The study identified seven risks which most occurred in the
business line in the study area and respondents are asked to rank them according their perception.
Entry of large players is the important risk in the study area as the respondents are all small
business owners and it is evident from tables 3A and 3B as the ‘entry of large business players’ is
the greatest problem of women entrepreneurs with 21357 Garrett points whereas ‘lack of export
opportunities’ stood at second place with 19471 Garrett points. The small business is facing great
problem exporting their products or services to international trade that provides more profits. The
financial crunches results the inefficient performance of the small entrepreneurs and it is proved in
the study as it stood as the last business risk to the women entrepreneurs in the study.
6
6. Conclusion
The women who expertise their hobby and further it may be converted into the business.
This ‘converting hobby into the business’ is the best concept of conceiving the business idea.
‘Ability to deal with the situation’ is the most important talent they have for their success.
Communication skills or ability helps the women entrepreneurs for their success in the business.
The ‘entry of large business players’ is the greatest problem of women entrepreneurs. The women
entrepreneurs should perceive the risks as their stepping stones for success and improve confidence
on their entrepreneurial ability.
Table 1A : Conceive the idea of enterprise by women entrepreneurs
Conceive the Idea 1 2 3 4 5 6 7 8

Discussion with other people 35 37 35 36 114 35 33 35 360
Looking through books 36 100 39 36 36 36 38 39 360
Brainstorming 35 39 36 106 39 38 31 36 360
New ways of doing old things 39 37 30 35 33 33 51 102 360
Converting hobby into business 101 38 36 33 38 39 36 39 360
Utility of waste material 39 34 115 39 30 33 35 35 360
Improving an existing product 36 39 33 36 31 36 113 36 360
Previous job experience 39 36 36 39 39 110 23 38 360
Total 360 360 360 360 360 360 360 360
Garrett's Table Value 80 67 60 53 47 40 33 20
Source: Survey
Table 1B: Conceive the Idea of enterprise by women entrepreneurs: Garrett’s Ranking Approach.
Conceive the Idea Garrett’s Mean
1 2 3 4 5 6 7 8 Rank
Score Score
Discussion with
2800 2479 2100 1908 5358 1400 1089 700 17834 49.54 5
other people
Looking through
2880 6700 2340 1908 1692 1440 1254 780 18994 52.76 2
books
Brainstorming 2800 2613 2160 5618 1833 1520 1023 720 18287 50.80 4
New ways of doing
3120 2479 1800 1855 1551 1320 1683 2040 15848 44.02 8
old things
Converting hobby
8080 2546 2160 1749 1786 1560 1188 780 19849 55.14 1
into business
Utility of waste
3120 2278 6900 2067 1410 1320 1155 700 18950 52.64 3
material
Improving an
2880 2613 1980 1908 1457 1440 3729 720 16727 46.46 7
existing product
Previous job
3120 2412 2160 2067 1833 4400 759 760 17511 48.64 6
experience
7
Table 2A: Perception of Women Entrepreneurs on their entrepreneurial ability.
Perception on their
entrepreneurial 1 2 3 4 5 6 7 8 9 10 11 Total
ability
Risk taking 20 25 28 29 23 25 111 26 22 27 24 360
Drive and 30 20 23 109 25 30 26 23 23 23 28 360
delineation
Relation with other 28 24 28 23 20 106 23 25 25 29 29 360
entrepreneurs
Ability to deal 21 115 25 26 23 22 28 29 28 21 22 360
with situations
Human resource 19 26 28 25 125 23 25 24 21 10 34 360
management
Technical 28 25 29 23 26 25 29 29 27 109 10 360
knowledge
Communication 102 28 5 25 23 26 23 23 23 45 37 360
ability
Vision about future 25 22 29 23 20 23 26 29 28 23 112 360
Creativity 30 28 30 27 26 25 22 25 108 20 19 360
Emotional stability 29 27 110 23 23 29 24 26 26 23 20 360
Clarity of
28 20 25 27 26 26 23 101 29 30 25 360
objectives
Total 360 360 360 360 360 360 360 360 360 360 360
Garrett's Table 83 72 65 59 55 50 45 41 35 28 17
Value
Source: Survey
8
Table 2B: Perception of Women Entrepreneurs on their entrepreneurial ability: Garrett’s Ranking Approach
Perception on Garrett's Mean

entrepreneurial 1 2 3 4 5 6 7 8 9 10 11 Rank
Score Score
ability
Risk taking 1660 1800 1820 1711 1265 1250 4995 1066 770 756 408 17501 48.61 7
Drive and
2490 1440 1495 6431 1375 1500 1170 943 805 644 476 18769 52.14 4
delineation
Relation with other 2324 1728 1820 1357 1100 5300 1035 1025 875 812 493 17869 49.64 6
entrepreneurs
Ability to deal with 1743 8280 1625 1534 1265 1100 1260 1189 980 588 374 19938 55.38 1
situations
9
Human resource 1577 1872 1820 1475 6875 1150 1125 984 735 280 578 18471 51.31 5
management
Technical 2324 1800 1885 1357 1430 1250 1305 1189 945 3052 170 16707 46.41 10
knowledge
Communication 8466 2016 325 1475 1265 1300 1035 943 805 1260 629 19519 54.22 3
ability

Vision about future 2075 1584 1885 1357 1100 1150 1170 1189 980 644 1904 15038 41.77 11
Creativity 2490 2016 1950 1593 1430 1250 990 1025 3780 560 323 17407 48.35 8
Emotional stability 2407 1944 7150 1357 1265 1450 1080 1066 910 644 340 19613 54.48 2
Clarity of 2324 1440 1625 1593 1430 1300 1035 4141 1015 840 425 17168 47.69 9
objectives
Table 3A: Perception of Women Entrepreneurs on business risks.
Perception on business risks 1 2 3 4 5 6 7 Total

Entry of large players 124 40 60 55 33 23 25 360
Technological obsolence 40 55 99 31 43 42 50 360
Non-cooperation of financial
24 50 60 30 35 46 115 360
institutions
Poor quality perception of
40 30 61 111 35 45 38 360
consumers
Availability of low cost substitutes 41 32 25 40 57 103 62 360
Lack of export opportunities 45 117 30 43 48 48 29 360
Problem of price variation 46 36 25 50 109 53 41 360
Total 360 360 360 360 360 360 360
Garrett’s Table Value 79 66 57 50 43 34 22
Source: Survey
10
Table 3A: Perception of Women Entrepreneurs on business risks: Garrett’s Ranking Approach
Perception of business Garrett's Mean

1 2 3 4 5 6 7 Rank
risks Score Score
Entry of large players 9796 2640 3420 2750 1419 782 550 21357 59.33 1
Technological obsolence 3160 3630 5643 1550 1849 1428 1100 18360 51.00 3
Non-cooperation of
1896 3300 3420 1500 1505 1564 2530 15715 43.65 7
financial institutions
Poor quality perception
3160 1980 3477 5550 1505 1530 836 18038 50.11 4
of consumers
11
Availability of low cost

3239 2112 1425 2000 2451 3502 1364 16093 44.70 6
substitutes
Lack of export
3555 7722 1710 2150 2064 1632 638 19471 54.09 2
opportunities
Problem of price

3634 2376 1425 2500 4687 1802 902 17326 48.13 5
variation
References
1. H.S.Anitha & A.S.Laxmisha, “Women Entrepreneurship in India”. Southern Economist,
Vol. 38, No. 4, June 15, 1999.
2. C. Beena & B. Sushma, “Women Entrepreneurs Managing Petty Business: A Study from
Motivational Perspective”, Southern Economist, Vol. 42, No. 2, May 15, 2003.
3. W. Kalyani &K. Chandralekha, “Association between Socio-economic Demographic Profile
and Involvement of Women Entrepreneurs in their Enterprise Management”, The Journal of
Entrepreneruship, Vol. 11, No. 2, July-December, 2002.
4. Dr. Y.V.S. Subrahmanya Sarma,(2007) Women Entrepreneurs in Semi-urban Areas of
A.P .- A Study of Socio, Economic and Motivational Factors. SRM Management Digest,
SRM university, Chennai.
5. Bhatia, B.S., New Industrial Entrepreneurs, Their Origins and Problems, Journal of General
Management, Vol.2, January 1975.
12
Impact of the Direct Tax Code on

Different Income Group of Assesses
– Dr. Vikas Kumar*
– Dr. Sohan Lal Yadav**
Abstract
The year 2009 was a landmark year for Indian taxation system. The Government of
India introduced the Direct Taxes Code (DTC) Bill along with a Discussion Paper on 12th
August 2009 for public comments. A lot suggestions and recommendations received from
different stakeholders. Thereafter, the revised DTC Bill has been issued on 15th June 2010.
The Union Cabinet approved the DTC on 26th August 2010. A paradigm change is going to
take place very shortly in the Indian tax system after 50th (golden zubli year) year of income
tax act 1961 which was applicable from 1-4-1962 to 1-4-2012 with the adoption of the
DTC.This paper is an attempt to present history of Indian tax system, objective of direct tax
code and imputed effect of the DTC on the different Income group of assesses.
1. Introduction
The present income tax law in India was enacted in the year 1961with Income Tax Act,
1961& applicable Since 1962 then the economy has undergone a complete transformation with
new kinds of business and activities coming up. The year 2009 was a landmark year for Indian tax
system. The government introduced Direct Taxes Code Bill. Dr. Manmohan Singh, Hon’ble Prime
Minister of India, released the draft Direct Taxes Code (DTC) along with a Discussion Paper on
12th August 2009 for public comments with a view to making taxation system more easy, simple,
logical and acceptable to all. The revised Direct Tax Code (DTC) bills have been issued on 15th
June 2010. The Union Cabinet approved Direct Tax Code on 26th August 2010. It was assumed
that, the bill extends to the whole of India and shall come into force from the 1st day of April 2013
after 50 year of previous act.
2. Objective of the Study

The objective of the paper is to examine the impact of implementation of the Direct Tax
Code on affected Individuals.
* Guest Faculty, Department of Commerce, Harishchandra P.G. College, Varanasi.

** Head, Department of Commerce, Harishchandra P.G. College, Varanasi.
13
3. History of Indian Tax System

In India, the first Income Tax Act was enacted in the year 1860 by Sir James Wilson during
the British rule. Due to financial crunch at the time of “Sepoy Munity” in 1857 the British Government
compelled the Government to introduce Income tax act. It was in force for the period of five years.
In this Act the tax rate for each source were prescribed separately. However this Act was abolished
in 1865.
In 1886 a new Income Tax Act was introduced after many amendments done after 1860,
i.e., 1863, 1867, 1873 and 1880; which clearly defined the different tax rate for different sources of
income. Under this Act there were four heads of income, namely a. Income from salary and
pension; b. Income from interest on securities; c. Income from company profits and d. Other
incomes. With the different amendments this act continued till 1918.
In 1918 a fresh legislation was passed for the purpose of removing financial difficulties
caused due to First World War. This Act first time introduced the concept of aggregate income to
compute the tax liability. Under this system, six heads of income was identified for taxation purpose,
namely a. Income from salary; b. Income from interest on securities; c. Income from house property;
d. Income from business; e. Income from profession and f. Income from other sources.
The Income Tax Act of 1918, which remained in force only four years and was replaced by
a new Act of 1922. First time this act introduced the concept of Assessment year and previous
year. According to this act the taxation rate was to be determined by Finance Act in every year.
During the period of 1922 to1939 this act was amended twenty times.
In 1939 the existing act of 1922 was exhaustively amended. This amendment brought the
concept of foreign income, resident, resident but not ordinary resident and non-resident. During the
period of 1939 to 1956 this Act was amended twenty nine times.
After independence the Government set up various committees and commissions to reduce
complications of Income Tax Act,viz, Taxation Enquiry Commission in 1953 and Direct Taxes
Administration Enquiry Commission chaired by Mr. Mahavir Tyagi in 1958. On the basis of
recommendations of these two Commissions, the Income Tax Act 1961 was passed. But this act is
very complex, inconvenient and incomprehensive. It contains a large number of provisions, viz,
different rates, different forms, cascading effects etc. Simplification of the Act is highly desirable
as per recommendation of different experts, academicians, and professionals. The Income Tax Act
1961 continues till date with the various amendments in almost every year. In the year 2010 a new
taxation system, Direct Tax Code (DTC) was introduced and approved by the Union Cabinet on 26
August 2010 to be effective from 1st April 2013.
14
4. Objective of Direct Tax Code

After the Income Tax Act 1961 the economy has undergone a sea change with new kinds of
business and activities. To make the tax laws incorporate these changes the government has now
come up with the DTC. It proposes to simplify the tax laws including a new way to calculate taxes
on incomes and it also lays out comprehensive guidelines at par with international taxation standard.
The code is scheduled to replace the existing Act from 1st April 2013. Direct Tax Code is reforms
in direct taxation. The main purpose of this Act is to enhance simplicity, efficiency, equality,
modernization and expansion of tax base.
The objectives of Direct Tax Code (DTC) are the following:
• Raising tax revenue in Gross Domestic Product (GDP) ratio,
• Improving equality,
• Reducing compliance cost.
• Reducing ambiguity in tax law,
• Reducing tax avoidance.
• Minimizing tax dispute.
• Preventing the erosion of tax base through tax evasion.
• Minimize litigation.
• Reducing the complexity in tax structure
• For clear understanding to tax payers..
• Rationalizing Tax system
• Single code for wealth tax
5. Analysis of Tax Liability of Individuals
• Maximum Investment Rebate under Income Tax `. 1,00,000 /1, 20,000 (u/s 80C).
• Maximum Investment Rebate under DTC `. 1, 50,000 (u/s 69, 70, 71, 72, 73).
15
Table 1.1: Comparative Analysis of Tax Structure
Particulars Tax rates Under Income tax DTC

Individual Income exempt from tax Up to 1,60,000 Up to 2,00,000
10% 1,60,001 to 5,00,000 2,00,001 to 5,00,000
20% 5,00,001 to 8,00,000 5,00,001 to 10,00,000
30% 8,00,001& above 10,00,001 & above
Education cess 3% 3%
Women Income exempt from tax Up to 1,90,000 Up to 2,00,000
10% 1,90,001 to 5,00,000 2,00,001 to 5,00,000
20% 5,00,001 to 8,00,000 5,00,001 to 10,00,000
30% 8,00,001 and above 10,00,001 and above
Senior citizen Income exempt from tax Up to 2,40,000 Up to 2,50,000
10% 2,40,001 to 5,00,000 2,50,000 to 5,00,000
20% 5,00,001 to 8,00,000 5,00,001to 10,00,000
30% 8,00,001 and above 10,00,001 and above
Table 1.2: Impact of Tax of Different Income Group of Assesses
Particulars Income Tax DTC Saving

Structure
If annual Income is Rs. 5 Lakh
Max investment rebate 1,20,000 1,50,000
Income chargeable to tax 3,80,000 3,50,000
Tax payable :
Individual 22,660 15,450 7,210
Women (below 65 years) 19,570 15,450 4,180
Senior citizen 14,420 10,300 4,120
16
Particulars Income Tax DTC Saving

Structure
Tax payable :
Individual 1,21,540 1,03,000 18,540
Women (below 65 years) 1,18,450 1,03,000 15,450
Senior citizen 1,13,300 97,850 15,450
Tax payable :
Individual 2,76,040 2,42,050 33,990
Senior citizen 2,67,800 2,36,900 30,900
Tax payable
Individual 4,30,540 3,96,550 33,990
Senior citizen 4,22,300 3,91,400 30,900
If annual Income is Rs. 1 Crore
Tax payable
Individual 29,02,540 28,68,550 33,990
Senior citizen 28,94,300 28,63,400 30,900
17
Note: (1) The calculation assumes that education cess of 3 % shall continue.
(2) The calculation assumes every Individual avails maximum Investment Rebate.
From the above Chart we can conclude the followings:
• This is clear from the above computation that proposed Taxes code is very beneficial,
as it reduces the Tax Liability of an individual substantially.
• Lower income class will not affect at all by DTC from the point of view of tax liability.
(Say income Level up to ` 2,50,000).
• Tax liability of middle class obviously will be reduced. They are highly benefitted by
introduction of DTC by the way of saving of tax.
• Higher middle class will also be benefited by DTC by way of savings of tax.
• Tax liability of Higher-class will also be reduced by same amount as of Higher middle
class.
• Saving of tax of these groups will encourage savings and investment which shall boost
the economy.
• Relief in taxes to these groups will motivate a large number of tax payers to deposit
their taxes honestly and attract new tax payers.
6. Conclusion
The objective of increasing the exemption level and providing little more relief at the low end
has been targetted to get benefits across to the largest number of taxpayers. People earning more
than ` 10 lakh a year may save up to ` 41,040 in income tax, if slabs proposed by the Direct Taxes
Code (DTC) bill come into effect, experts said.Similarly, tax burden would reduce by ` 21,540 for
those earning annual income between ` 5 lakh and ` 10 lakh, while those making ` 2 lakh to 5 lakh
could be richer by ` 7,660. The government has estimated a revenue loss of over
` 15,000 crore just on widening the slabs.
Around 96% of India’s taxpayers are in the earning bracket of ` 1 lakh to ` 5 lakh. 95.75 %,
to be precise, of India’s 3.25 crore tax payers are in the slab of ` 1 lakh to ` 5 lakh of income. They
pay around 30 % of our total taxes.The slab of ` 8 lakh and above accounts for 2.2 % of our
taxpayers, but they pay 60 % of the taxes, that leaves 10 % which is in the ` 5 lakh to ` 8 lakh.
As such The Direct Tax Code is simpler than the existing taxation system and tax savings in
the hands of taxpayers will encourage investors to deploy part of their savings in equities and other
consumptions leading to all round growth of our economy keeping in view the benefits of DTC the
potential revenue loss of govt. is negligible and avoidable.
18
References
1. Direct Tax Code, 2010, Bharat Law House (P) Ltd., New Delhi.
2. Shetly, S.L., 2010, More Tax Concession for More Inequality, Economic and Political Weekly,
Vol XLV (ii), March 13, 2010.
3. Singhania Vinod Kr. & Singhania Kapil, (2010), Direct Taxes Law and Practice, Taxmann.
4. The Economic Times, 27 August 2010.
5. The Management Accountant, The Institute of Cost & Works Accountants of India, June
2010.
6. V.S Datey, (2010), Indirect Taxes --- Law and Practice, Taxmann.
7. www. Caclubindia.com
19
An Empirical Study on Occupational Stress among the

Employees of Telecom Industry
– Dr. P. Paramanandam*
Abstract
Stress is a state of mind that reflects certain biochemical reactions in the human
body and is projected by a sense of anxiety, tension and depression and is caused by such
demands by the environmental forces or internal forces that cannot be met by the resources
available to the person. The objective of this study was to identify the factors which cause
stress among the employees of telecom industry and also differences in the level of stress
among the respondents of different age, gender, education, experience, and income groups.
A convenience sample consisting of 70 employees working in Telecom industry participated
in the study. A structured, self-administered questionnaire with a 5 point Likert scale was
used for data collection. The collected data was analysed with Mean, Standard Deviation,
ANOVA and Factor Analysis. A high level of stress was seen among the female respondents
and a low level of stress among the male respondents. A high level of stress was seen among
the diploma holders and a low level of stress among the post graduates. A high level of stress
was seen among the freshers and a low level of stress in the above 10 years experience
group. A high level of stress was seen among the respondents of below 10000 income group
and a low level of stress in the above 20000 income group. Results of ANOVA test indicated
that there were significant differences in the level of stress among the respondents belonging
to different age, education, work experience and income groups. Sixteen variables in the
data have been reduced to three factors and each factor has been given a name.
Key Words: Anxiety, Conflicts, Stress.
1. Introduction
Stress arises when individuals perceive that they cannot adequately cope with the demands
being made on them or with threats to their well being (Lazarus, 1966). Job stress is a condition
arising from the interaction of people and their jobs and characterized by changes within people that
force them to deviate from their normal functioning (Beehr and Newman, 1997). Selye (1974), who
has done considerable research on stress, has viewed stress as the “non-specifically induced changes
within a biological system.” It is non-specific because any adaptation to a problem faced by the
* Associate Professor, GRG School of Management Studies, Psgr Krishnammal College For Women, Peelamedu,
Coimbatore-641 004 Tamil Nadu. Phone: Office: 0422 257 2222 Mobile: 94432 05018 Fax: 91 422 259 1255 Email:
paramanandam@grgsms.com
20
body, irrespective of the nature of the problem, is included in stress. Ivancevich and Matteson
(1983) have defined stress as an adaptive response, mediated by individual characteristics and/or
psychological processes, that is, a consequence of any external action, situation, or event that
places special physical and / or psychological demands upon a person.
There are three categories of potential stressors: environmental, organizational, and individual.
Environmental factors include economic uncertainty, political uncertainty, and technological
uncertainty. Organizational factors include task demands, role demands, interpersonal demands,
organizational structure, organizational leadership, and organization’s life stage. Individual factors
include family problems, economic problems and personality.
High level of stress (distress) causes physiological, psychological, and behavioural problems.
Physiological consequences include heart disease, ulcers, high blood pressure, headaches, sleep
disturbances etc. Psychological consequences include job dissatisfaction, depression, exhaustion,
moodiness, burnout, etc. Behavioural consequences include lower job performance, more accidents,
faulty decisions, higher absenteeism, work place aggression, etc.
2. Review of Literature
P.K. Srivastava and M.M. Sinha (1983) investigated the effect of employee’s ego strength
and job involvement on their experience of role stress arising from role overload, role ambiguity and
role conflict. They opined that these two variables are of central importance in influencing employees’
behavior and adjustment on the job. For the purpose of the study, the Ego Strength Scale (Hasan,
1974), the Job Involvement Scale (Lodahl and Kejner, 1965) and the Occupational Stress Index
(A.K. Srivastava and A.P.Singh, 1981) were administered to a sample of 120 respondents. The
sample comprised 30 managers, 30 engineers, 30 superintendents and 60-section in-charge. Critical
ratio tests, product moment coefficients and two-way analysis of variance were used to analyze
the data. The analysis of the data established that the perceived role stress of the managerial
personnel might be viewed as a function of their ego strength and job involvement. Employees, for
example, with high ego strength were reported to experience mild stress pertaining to role overload,
role ambiguity and role conflict than moderate or low ego strength groups. Similarly, employees
manifesting higher job involvement were less stressed by overload and role ambiguity as compared
to the other two groups. Analysis of variance showed that ego strength and job involvement are not
independent of each other in their effect but interact to facilitate each other in moderating the
severity of stress-inducing aspects of the work situation and experience of role stresses. The
authors concluded that high ego strength enables employees to cope effectively with excessive
demands and conflicting expectations. On the other hand, job involvement leads to job satisfaction
and enhances the level of intrinsic motivation.
21
Srivastava and Sehgal (1984) examined the effect of employee’s n-achievement on their
perception of occupational stress using a sample of 200 white-collar employees of a large industrial
organization. The Occupational Stress Index and the Employees’ Motivational Schedule
(A.K.Srivastava, 1985) were administered to the respondents. On the basis of the median of the
distribution of scores on the measure of n-achievement, the respondents were divided into low and
high motivation groups to test the differences in stress scores. The analysis revealed that employees
who maintained high work motivation experienced significantly lower occupational stress, such as
role overload, role ambiguity, role conflict, unreasonable group and political pressures, responsibility
for persons, poor peer relations, strenuous working conditions and unpredictability as compared to
the low n-achievement group. Further, employees with high need for production, goal achievement
and competition also experienced lower occupational stress. It is inferred from these findings that
high need for achievement acts as a resource in influencing the cognitive appraisal of stress-
inducing characteristics of job components and situations in such a way as to moderate their
effectiveness.
Helode and Palnitkar (1987) investigated the ‘variance’ of occupational stress in the light of
field dependence-independence (FD-FI), and job level in the case of bank employees. The sample
included 100 officers and 100 clerks. Two psychometric instruments - Indian adaptation of Witkin
et al.’s Embedded Figures Test (EFT) and the Occupational Stress Index (A.K. Srivastava and
A.P.Singh, 1981) – were administered to the respondents. The analysis revealed that
a. FI-FD and occupational stress were normally distributed among middle and lower
level managers.
b. FI-FD had a positive and significant association with occupational stress.
c. Occupational stress was significantly higher among officers than clerks and
d. Field independent officers were found to experience more occupational stress than
field dependent clerks, whereas field independent clerks experienced more occupational
stress as compared to field dependent officers.
Jasmine (1987) compared the job stress of public and private blue collar workers and found
that the former experienced significantly more stress than the latter. Frequent changes in policies,
centralized control and decision-making, and sub-optimization of performance could be the contributing
factors.
Sharma (1987) did a comparative study of managers and supervisors in both public and
private sector organizations. His findings are:
22
a. Those in the private sector scored significantly higher on role conflict, role erosion,
resource inadequacy and role isolation.
b. Supervisors in public sector organizations scored significantly higher on role stagnation,
role ambiguity and resources inadequacy than those in the private sector.
c. Managers in the public sector had significantly higher scores than supervisors on role
erosion and role overload.
Kumar (1989) conducted a study among public sector executives. His findings are:
a. Unmarried executives experienced higher levels of role stress than married executives
b. Executives with a post graduate degree found them to be adequately able to do the job
in comparison with those with a graduate degree.
c. Executives, who were spouses of workingwomen, experienced significantly more stress
than those married to housewives.
d. Marketing executives experienced more stress than those in charge of accounts, finance,
production, personnel and the rest.
3. Objectives of the Study

The objective of the study was to find out the factors which cause stress among the employees
of telecom industry and also differences in the level of stress among the respondents of different
age, gender, education, experience, and income groups.
4. Methodology
A convenience sample consisting of 70 employees working in Telecom industry participated
in the study. A structured, self-administered questionnaire with a 5 point Likert scale was used for
data collection. The questionnaire contained sixteen statements relating to occupational stress.
Responses were collected on these statements and were scored as follows:
Never = 1, Infrequently = 2, Sometimes = 3, Often = 4 and Always = 5. The collected data
was analysed with Mean, Standard Deviation, ANOVA and Factor Analysis.
5. Results and Discussion

This section presents the analysis of the data collected from the respondents. Table 1 provides
the demographic characteristics of the sample.
23
Table 1 : Demographic characteristics of the Sample
Demographic Number of
Classification Percent
factors Respondents
Age ( in years) Below 30 26 37.1
30-40 21 30.0
40-50 13 18.6
Above 50 10 14.3
Gender Male 51 72.9
Female 19 27.1
Education Diploma 19 27.1
Graduate 28 40.0
Post graduate 23 32.9
Work Experience Freshers 13 18.6
(in years) 1-5 35 50.0
5 - 10 10 14.3
Above 10 12 17.1
Income Below 10000 18 25.7
(in rupees) 10000-15000 30 42.9
15000-20000 13 18.6
Above 20000 9 12.9
Among the 70 respondents, 26 (37.1%) belong to below 30 years age group and 21 (30.0%)
belong to 30-40 age group; 51 (72.9%) are male; 28 (40.0%) are graduates and 23 (32.9%) are
post graduates; 35 (50.0%) belong to 1-5 years experience group; and 30 (42.9%) belong to 10000-
15000 income group.
24
Table 2 : Mean, Standard Deviation and ANOVA

Demographic Number of Standard
Classification Mean F-Value P-Value
factors Respondents Deviation
Age ( in Below 30 26 53.38 9.100
years) 30-40 21 49.38 9.510
40-50 13 43.31 7.598 7.240 .000
Above 50 10 38.10 13.683
Gender Male 51 46.86 11.236
2.554 .115
Female 19 51.53 9.726
Education Diploma 19 52.68 9.232
Graduate 28 50.14 11.065
6.761 .002
Post graduate 23 41.91 9.723
Work Freshers 13 58.15 6.793
Experience 1-5 35 49.51 9.874
(in years) 5 - 10 10 40.30 8.042 11.343 .000
Above 10 12 39.75 9.706
Income Below 10000 18 56.33 9.023
(in rupees) 10000-15000 30 50.07 8.354
15000-20000 13 43.77 5.918 20.821 .000
Above 20000 9 31.56 7.452
A high level of stress (Mean=53.38) was seen among the respondents of below 30 years age
group and a low level of stress (Mean=38.10) in the above 50 age group. A high level of stress
(Mean=51.53) was seen among the female respondents and a low level of stress (Mean=46.86)
among the male respondents. A high level of stress (Mean=52.68) was seen among the diploma
holders and a low level of stress (Mean=41.91) among the post graduates. A high level of stress
(Mean=58.15) was seen among the freshers and a low level of stress (Mean=39.75) in the above
10 experience group. A high level of stress (Mean=56.33) was seen among the respondents of
below 10000 income group and a low level of stress (Mean=31.56) in the above 20000 income
group. Results of ANOVA test indicated that there were significant differences in the level of
stress among the respondents belonging to different age, education, work experience and income
groups.
25
Factor Analysis
Sixteen statements pertaining to stress were subjected to Factor Analysis. Correlation matrix was
computed to test the suitability of the data for Factor Analysis and the results were found to be satisfactory.
Table 3 : KMO and Bartlett’s Test
Kaiser-Meyer-Olkin Measure of Sampling

.880
Adequacy.
Bartlett’s Test of Approx. Chi-Square 950.093
Sphericity df 120
Sig. .000
Bartlett’s Test of Sphericity was calculated to find whether the number of correlations among
variables is statistically significant or not. Kaiser-Meyer-Olkin was found to be 0.880 and Bartlett’s
test of Sphericity was also significant (Chi-Square value = 950.093, df =120, significance = 0.000)
indicating the suitability of the data for factor analysis.
Factor Extraction
Using the Principal Component Analysis three factors have been extracted based on the
variance (Eigen value greater than 1). The variance explained by the initial solution, extracted
components, and rotated components are displayed in table 4.
Table 4 : Total Variance Explained
Extraction Sums of Squared Rotation Sums of Squared
Initial Eigen Values
Loadings Loadings
Component
% of Cumulative % of Cumulative % of Cumulative
Total Total Total
Variance % Variance % Variance %
1 8.605 53.780 53.780 8.605 53.780 53.780 6.756 42.227 42.227
2 2.031 12.691 66.471 2.031 12.691 66.471 2.891 18.070 60.298
3 1.980 6.124 72.595 1.980 6.124 72.595 1.968 12.297 72.595
4 .886 5.539 78.134
5 .716 4.475 82.608
6 .446 2.790 85.398
7 .410 2.565 87.963
8 .339 2.121 90.084
9 .294 1.837 91.920
10 .283 1.770 93.691
11 .254 1.586 95.276
12 .221 1.381 96.657
13 .182 1.136 97.793
14 .153 .958 98.751
15 .124 .773 99.524
16 .076 .476 100.000
26
Extraction Method: Principal Component Analysis

The three factors extracted together account for 72.595 % of the total variance (information
contained in the original sixteen variables). On the extraction initially, factor one is able to explain
53.780 % of variance, factor two explains 12.691 % and factor three explains 6.124 %. The initial
and extracted communalities were computed along with the rotated components using varimax
rotation and are displayed in table 5.
Table 5 : Rotated Component Matrix
Component
Variables 1 2 3
V 1 Unclear about what is expected .559
V 2 Co-workers seem unclear about what my job is .648
V 3 Differences of opinion with superiors .712
V 4 Demands of others for my time .783
V 5 Lack of confidence in management .755
V 6 Conflict exists between my unit and others .810
V 7 I have unsettled conflicts with my co-workers .858
V 8 I spend my time “fighting fires” .814
V 9 Under qualified for the work I do .769
V 10 I get feedback only when my performance is unsatisfactory .846
V11 Decisions are made without my knowledge .815
V12 I am expected to accept the decisions of others .721
V 13 No support from co-workers .860
V 14 Do not receive right amount of supervision -.631
V 15 Over qualified for the work I do .817
V 16 Too much to do in too little time .647
Extraction Method: Principal Component Analysis.
Rotation Method: Varimax with Kaiser Normalization.
a. Rotation converged in 6 iterations.
Factor analysis technique helps to reduce the number of variables and to detect structure in
the relationships between variables. Variables V1, V2, V3, V4, V5, V6, V7, V8, V10 and V16 have
high loadings on Factor 1. This suggests that Factor 1 is a combination of these variables. Analysis
of these variables led the researcher to name this Factor 1 as Role Expectations and Conflicts.
Variables V11, V12, and V13 have high loadings on Factor 2. So Factor 2 is a combination of these
27
three variables. This factor can be called Decision making and Support. Variables V9, V14, and
V15 have high loadings on Factor 3. This Factor can be called Qualification and Supervision. Thus
sixteen variables in the data have been reduced to three factors and each factor has been given a
name. The three factors are Role Expectations and Conflicts, Decision making and Support, and
Qualification and Supervision.
6. Conclusion
The objective of this study was to identify the factors which cause stress among the employees
of telecom industry and also differences in the level of stress among the respondents of different
age, gender, education, experience, and income groups. A convenience sample consisting of 70
employees working in Telecom industry participated in the study. A structured, self-administered
questionnaire with a 5 point Likert scale was used for data collection. The collected data was
analysed with Mean, Standard Deviation, ANOVA and Factor Analysis. A high level of stress was
seen among the respondents of below 30 years age group and a low level of stress in the above 50
years age group. A high level of stress was seen among the female respondents and a low level of
stress among the male respondents. A high level of stress was seen among the diploma holders and
a low level of stress among the post graduates. A high level of stress was seen among the freshers
and a low level of stress in the above 10 years experience group. A high level of stress was seen
among the respondents of below 10000 income group and a low level of stress in the above 20000
income group. Results of ANOVA test indicated that there were significant differences in the level
of stress among the respondents belonging to different age, education, work experience and income
groups. Sixteen variables in the data have been reduced to three factors and each factor has been
given a name. The three factors are Role Expectations and Conflicts, Decision making and Support,
and Qualification and Supervision.
References
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Job Satisfaction: Meta-Analysis and Assessment of Causal Effects”, Journal of Marketing
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28
5. Coverman S (1989), “Role Overload, Role Conflict, and Stress: Addressing the Consequences
of Multiple Role Demands”, Social Forces, Vol. 4, pp. 965-982.
6. Dailey R (1980), “Relationship Between Locus of Control, Task Characteristics, and Work
Attitudes”, Psychological Reports, Vol. 47, pp. 855-861.
7. Glazer S and Beehr T A (2005), “Consistency of the Implications of Three Role Stressors
Across Four Countries”, Journal of Organizational Behavior, Vol. 26, pp. 467-487.
8. Goleman, D. (1996), “Meditation Helps Break the Stress Spiral” Health Administrator, 7, 77-
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9. Greenberg J and Baron R A (1995), Behavior in Organizations, 5th Edition, Prentice Hall,
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10. Hollon C J and Chesser R J (1976), “The Relationship of Personal Influence Dissonance to
Job Tension, Satisfaction and Involvement”, Academy of Management Journal, Vol. 19, No.
2, pp. 308-314.
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Dilemma? Role Theory Offers an Explanation”, British Journal of Occupational Therapy,
Vol. 64, No. 1, pp. 34-40.
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Regulation, 69.
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on Role Ambiguity and Role Conflict in Work Settings”, Organizational Behavior & Human
Decision Processes, Vol. 36, pp. 16-78.
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Urbanowski, Ferris, Harrington, Anne, Bonus, Katherine, Sheridan, John F. (1987), “Alterations
in Brain and Immune Function produced by Mindfulness Meditation” Psychosomatic Medicine,
65, 564-570.
15. Lazarus, R.S. & Folkman, S. (1984). Stress, appraisal, and coping. New York: Springer.
16. Lovell-Smith, H.D. (1985), “Transcendental meditation and three cases of migraine” The
New Zealand Medical Journal, 98, 443-445.
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experimental pain” Psychosomatic Medicine, 43 (2), 157-164.
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Studies, 26-29.
29
19. Pelletier, K.R., Peper, E. (1977), “Alpha EEG Feedback as a Means for Pain Control”
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30
Performance Management System in a Manufacturing Company

- A Study from Employee Perspective
– Sitansu Panda*
Abstract
The importance and issues involved in Performance Management System is
highlighted. In this article, the four aspects as performance planning, performance appraisal,
performance managing and performance monitoring and their relationship with the PMS
of the company has been explored. Different components of Organizational Effectiveness
(OE) have been studied and its relationship with PMS has been studied. Finally, some
tentative measures have been suggested for strengthening the PMS to have a better result in
future. This anonymous study has been conducted in a manufacturing company.
Key Words: Performance Management System (PMS), Organizational Effectiveness
(OE) “The man who does not take pride in his own performance performs nothing in
which to take pride.”- Thomas Watson.
1. Introduction
In the changing scenario of business, organizations are expected to deliver the best products/
services to the customers. Companies need to ensure the quality and quantity of the products to be
delivered to the customers within the prescribed time frame to retain in the competitive market. In
this context, all depends upon the performance of a company for which Performance Management
System has a vital role to play. This article discusses different components of Performance
Management System (PMS), and its relationship with the Organizational Effectiveness (OE) has
been explored.
Frederick Winslow Taylor is the first person who has put the performance measurement
concept into reality by advocating scientific management principles which led to the birth of industrial
engineering discipline in the era of modern management. The then focus was in managing production
lines and stores operations which gradually percolated down to HR development and more humane
practices developed over a period of time and the focus started building around measurement.
(Prasad, 2008).
The Oxford Dictionary defines the term Performance as the action or process of performing
a task or function. It is an act of presenting a play, concert or other form of entertainment.
* Associate Professor (HRM), Siva Sivani Institute of Management, Kompally, Secunderabad – 500014. He can be
reached at sitansupanda.ssim@gmail.com. M: 95-9912039510.
31
In Chambers Dictionary, Performance is defined as the act, process or art of performing. It

is the manner or quality of functioning, mode of conduct or behaviour.
In Collins Dictionary, the term Performance is defined as accomplishment, achievement, act,
carrying out, completion, conduction consummation, discharge, execution, exploit, feat or fulfillment
of work.
Performance means outcomes achieved or accomplishments at work (Prem Chandha, 2008).
It is about optimally realizing ones potential.
Camphell believe performance as behaviour which should be distinguished from its outcomes.
Brumback views performance more comprehensively by encompassing both behaviours
and results. He also focused that the role of any managee/ratee can be seen in three parts as:
Being, Doing and Relating where the first on is concern for the competencies, second one focus
reflects the activities and relating emphasizes the nature of relationships with members in
organizations. Being. The
Brumbrach (1988) defines performance both as behaviour and results. Behaviour emanates
from the performer and transforms performance from abstraction to action.
Performance is what is expected to be delivered in terms of results or effort, tasks and
quality, in relation to a given role during a particular period of time under the set of circumstances
operating at that point of time by an individual or a set of individuals within a time frame. And input,
output, time, focus, quality, cost are the different dimensions of performance. (T.V. Rao, 2007) It is
of paramount importance on the part of the organizations to excel in its performance in many
spheres through effective management. In this context, performance management has its relevance.
Different authors have defined performance management differently. Some of the definitions are
cited below.
T.V.Rao (2007) defined performance management is a process which involves thinking through
various facets of performance, identifying critical dimensions of performance, planning, reviewing,
developing and enhancing performance and related competencies. It attempts to ensure using
various interventions so that the individual delivers maximum output under the circumstances given
to him.
Ronnie Malcom (2007) defined performance management as a planned and systematic
approach to managing the performance of individuals ensuring their personal development and
contribution towards organizational goals.
According to John Storey (2005) performance management includes the whole cycle of
agreeing goals and objectives, providing feedback, offering coaching and advice and motivating
staff to perform at a high level.
32
Michael Armstrong & Angela Baron (2004) stated performance management is a process
which contributes to the effective management of individuals and teams in order to achieve high
levels of organizational performance.
Alex Aspromourgos (2004) mentioned performance management as an interlocking set of
policies and practices which focus to enhance achievement of organizational objectives through a
concentration of individual performance.
Rogers Davis (2004) stated performance management as a joint process which involves
both supervisor and employee in identifying common goals resulting in the establishment of written
performance expectations later used as measures for feedback and performance evaluation.
According to Bourne et al. (2003) performance management means performance
measurement which is the process of assessing progress toward achieving predetermined goals,
while performance management is building on that process adding the relevant communication and
action on the progress achieved against these predetermined goals.
Michael Armstrong (2000) defined performance management as a strategic and integrated
process that delivers sustained success to organizations by improving the performance of the people
who work in then and by developing the capabilities of individual contributors and team.
Louis R. Gomez & David B. Mejia (1999) defined performance management as a process
through which managers ensure that employee's activities and outputs contribute to organizational
goals.
Fletcher (1992) mentioned performance management as an approach to creating a shared
vision of the purpose and aims of the organization, helping each individual employee understand and
recognize their part in contributing to them, and in doing so manage and enhance the performance
of both individuals and the organization.
R. Lansbury (1988) stated performance management as a process of identifying, evaluating,
and developing the work performance of employees in organization, so that organizational goals
and objectives are more effectively achieved, while at back, catering for work needs and offering
career guidance.
Daniels and Rosen (1984) viewed performance as a data guided approach to managing
work behaviour.
In the Institute of Manpower Studies Report (1992) defined performance management as a
management system whereby the organizations, objectives are set and met by means of process of
objective setting for individual employee.
Performance management system is not same as performance appraisal system. The later
33
is often confused with the former and mostly misunderstood as synonymous which is not true.
Performance appraisal is a singular activity that is employed to assess performance of employees
for a predetermined period of time on a set of parameters. In contrast, the performance management
is an integrated activity which aims to nurture and institutionalize performance management system
of the entire organization and aligns performance of the employees with the organizational goals.
Wendell French (1997) defined performance appraisal and review is the formal systematic
assessment of how well employees are performing their jobs in relation to established standards
and the communication of that assessment to employees.
G.R. Terry et al. (1996) defined Performance appraisal is the periodic evaluation of an
employee’s job performance measured against the job stated or presumed requirements.
It is quite clear about performance management system from the definitions cited above. In
this research, organizational effectiveness is studied for which the definition given by Paul E. Mott
(1972) is considered and defined below.
Mott defines organizational effectiveness as the ability of an organization to mobilize its
centres of power for action-production and adaptation. He identified three ways in which
organizations mobilize its centres of power as: productivity, adaptability and flexibility. It assumes
that the arrangement of roles, responsibilities, power, authority and other devices of routinized
formal organization structure are related to productivity: quality, quantity and efficiency. These are
instrumental functions. He defined adaptability as involving changes organizational routine in response
to environmental changes. Flexibility involves changes in routinized organizational processes. These
are temporary responses to unpredictable changes in the environment. These are coping strategies
rather than lasting changes in organizational processes.

• To identify the components and procedure involved in Performance Management
System of the company.
• To explore the relationship between different components of Performance Management
System and PMS.
• To explore the relationship between Performance Management System and
organizational effectiveness.
4. Methodology
The study is conducted on the performance management system of Rajput Cements Company
Limited, Dharampur, Madhya Pradesh. The researcher has taken the views of the employees only
34
which include the technical and clerical staff of the organization. A specified questionnaire covering
different dimensions of performance management system was administered to forty employees.
From the total man power of 178 which includes managers, supervisors and worker, the workers
performing technical and supportive job constituted the main base of the study. And more particularly,
thirty per cent of such workers provided their viewpoints for this study. Their view points were
collected; collated and the formulated hypothesis had been tested by using SPSS. Both questionnaire
and focussed The contract workers are excluded from this study. Different journals, magazines,
books were reviewed. Both primary and secondary data were collected.
Brief About the Company

Rajput Cements Limited was granted license for manufacturing 3,96,000 MT of Portland
Cement per annum in 1972. The wet process plant was placed with BCP limited, in the same year.
The preliminary plant construction work was started in early 1974. The factory came up over
1,176.10 acres of land, out of which 994.70 acres is taken on lease from the State Government
while the remaining acres on freehold. The commercial production commenced from April 1978. It
is both ISO 9000 and ISO 14001 certified company. It manufactures three types of cement i.e.
Ordinary Portland Cement (OPC), Portland Slag Cement (PSC), Portland Pozzolana Cement (PPC).
5. Hypothesis
The hypotheses taken for this study are as follows:
• H0-1: There is no correlation between performance planning and performance
management system.
• H0-2: There is no significant relationship between performance appraisal and
performance management system.
• H0-3: There is no significant relationship between performance managing and
performance management system.
• H0-4: There is no association between performance monitoring and performance
management system.
• H0-5: There is no significant relationship between performance management system
and organizational effectiveness.
6. Data Analysis and Interpretation

Based on the responses taken from the employees, the relevant data have been collated and
their correlationship is explored which are given in the following tables.
35
Table 1 : Correlations
Performance Performance Performance Performance Performance
planning appraisal managing Monitoring Management
index index index System yields
results in all
dimensions
performance Pearson 1 .662** .548** .357* .089
planning Correlation
Sig. (2- .000 .000 .024 .583
tailed)
N 40 40 40 40 40
performance Pearson .662 ** 1 .566** .371* .143
appraisal index Correlation
Sig. (2- .000 .000 .018 .379
tailed)
N 40 40 40 40 40
Performance Pearson .548 ** .566** 1 .554** -.015
managing index Correlation
Sig. (2- .000 .000 .000 928
tailed)
N 40 40 40 40 40
Performance Pearson .357 * .371 * .554** 1 -.259
Monitoring Correlation
index Sig. (2- .024 .018 .000 .106
tailed)
N 40 40 40 40 40
Performance Pearson .089 .143 -.015 -.259 1
Management Correlation
System yields Sig. (2- .583 .379 .928 .106
results in all tailed)
dimensions N 40 40 40 40 40
**. Correlation is significant at the 0.01 level (2-tailed).

*. Correlation is significant at the 0.05 level (2-tailed).
The above table shows that there is no correlationship among the different components of
Performance Management System (PMS). The correlationship value (Pearson) for performance
planning with PMS is , correlationship value for performance appraisal with PMS is , the correlationship
value for performance managing with PMS is and performance monitoring with PMS is. All these
values are <0.5. And the null hypotheses (first four sets) are accepted.
36
Organization
Production Flexibility Adaptation Achievin g its
Effectiveness
Production Pearson
1 -.025 .018 .127
Correlation
Sig. (2-tailed) .877 .914 .433
N 40 40 40 40
Flexibility Pearson
-.025 1 .527** .170
Correlation
Sig. (2-tailed) .877 .000 .295
N 40 40 40 40
Adaptation Pearson
.018 .527 ** 1 .635 **
Correlation
Sig. (2-tailed) .914 .000 .000
N 40 40 40 40
Organization Pearson
.127 .170 .635** 1
Achieving its Correlation
Effectiveness Sig. (2-tailed) .433 .295 .000
N 40 40 40 40

The table-2 shows the correlationship among different components of Organizational
Effectiveness (OE) with OE. It is clear in the figures in the above table that the Pearson Correlation
value for adaptation with OE is 0.637 which is interpretated a having relationship with each other.
Except this, there is no correlationship among different components of Organizational Effectiveness
and OE as the respective values are < 0.5.
Performance
Organization Management
Achieving its System yields
Effectiveness results in all
dimensions
Organization Achieving its Pearson Correlation 1 -.814 **
Effectiveness Sig. (2-tailed) .000
N 40 40
Performance Management Pearson Correlation -.814** 1
System yields results in all Sig. (2-tailed) .000
dimensions N 40 40
37
The table-s shows that there is no correlationship between PMS and Organizational
Effectiveness. Rather, both have negative correlationship. In this way, the null hypothesis is accepted.
7. Findings and Suggestions

• In focused discussion with the employees they stated their views on the existing performance
management system. About ninety per cent of the respondents opined favourably on the
performance policy of the company. However, many of them were dissatisfied with the
execution of the policy.
• Majority of the respondents commented that there was no proper implementation of the
policy guidelines set for the individual as well as for the organizational growth.
• Top Level especially the reviewing officer and their comments on employees performance
ratings are biased.
• Around three-fourth of the respondents opined that they were least concern with the
Performance Management System of the company as they found no linkage of the
performance appraisal with their promotion.
• Around eighty per cent of the respondents commented about the PMS of the company as it
was devoid of linkage with the incentive and other components o compensation package.
More or less, reward system had no linkage with the evaluation of their performance.
• Most of the employees criticized that the whimsical way of appraising their performance by
their respective boos did not give any sense for the development of the company.
• There is lack of open communication with regard to the employee’s performance. The open
discussion with the subordinates, the team members, departmental members with trust and
better culture is the essence of a PMS. However, almost all the respondents (90%) opined
that the company lacks these aspects.
• More than three quarters of the (77%) respondents opined that they did not get proper
feedback from their respective bosses. And least opportunity for reviving their performance,
adjustment to their work related problems were evident.
• Around 60% of the respondents viewed about the improper work load distribution among the
employees.
• In connection with the appraisal, almost all the employees had commented the system as the
existing system provided least scope for rating the self appraisal. Although self appraisal is a
component of the appraisal system, it seems such component is kept as ritual with least area
to be evaluated.
38
• Some respondents were very critical about the ratings awarded by their boss and while doing
so, they least concern with the real performance of the subordinate and without considering
any of the employees difficulties, they gave equal ratings to all the employees which not only
effected their motivation but also lost the confidence on the entire system.
• In the discussion with the employees they stated that the performance management system
has least linkage with the training programmes to be imparted to them. The ritual practice of
filling the appraisal forms was strongly criticized by most of the respondents.
8. Conclusion
The Performance Management System is designed and implemented to excel the performance
of the individual as well as the organization as a whole. This study reveals that there is no correlation
between the components of the performance management system which needs to be revived and
such revival are expected to yield better results. It should be done with participation of the line
management and performance to be appraised at regular intervals followed by effective counseling.
The existing system can be further studied to explore the problematic issues and accordingly some
HRD measures can be taken to change and develop the system.
References
1. Adams, Stacy (1965), Injustice in Social Exchange, In L. Berkowitz (Ed.), Advances in
Experimental Social Psychology, New York: Academic Press.
2. Alderfer, Clayton P. (1969), An Empirical Test of a New Theory of Human Needs,
Organizational Behaviour and Human Performance, MI Publications.
3. Herzberg, Frederic, B. Mausner and B. Snyderman (1959), The Motivation to Work, New
York: John Wiley.
4. Hull, Clark Leonard (1943), Principles of Behaviour, Chicago: The University of Chicago
Press.
5. Kohli, A.S. & T. Deb (2008), Performance Management, Oxford University Press,
New Delhi.
6. Litwin, G.H. and R.A. Stinger (1968), Motivation and Organizational Climate, Boston: Harvard
Business School Press.
7. Maskell H. Brion (1991), “Performance Measurement of World Class Manufacturing”,
Productivity Press, New Delhi.
8. Maslow, Abraham H. (1943), A Theory of Human Motivation, Psychological Review, July,
HB Press.
39
9. McClelland, David (1961), The Achieving Society, Princeton, NJ: Van Nostrand.
10. Mott, Paul E. (1972), The characteristics of effective organizations, New York: Harper
& Row.
11. Nigam, Ashutosh (2007), “Impact of Quality Circles on firms performance- A study of selected
software units under software technology park, Noida”, Abhigyan, New Delhi.
12. Pantulu, N.Kamraju et. al.(2008), Performance Appraisal and Counselling, Himalaya Publishing
House, Mumbai.
13. Patton, Arch (1961), Men, Money and Motivation: New York: McGraw-Hill.
14. Porter, L.W. and E.E. Lawler (1968), Managerial Attitudes and Peformance, Homewood:
Irwin.
15. Prasad, GBRK (2008), Corporate Performance Improvement-A Practitioners Perspective,
IU Press, Hyderabad.
16. Rao, T.V. (2007), performance management and appraisal systems-HR Tools for Global
Competitiveness, Response Books, New Delhi.
17. Srinivas, R. Kandula (2007), Performance Management-Strategies, Interventions, Drivers,
Prentice Hall of India, New Delhi.
18. Thorndike, Edward Lee (1932), The Fundamentals of Learning, New York: Columbia
University Press.
19. Vroom, V.H. (1964), Work and Motivation, New York: John Wiley.
20. Waal, 2001 in Tapamoy Deb (2009), Performance Management System, Global Vision
Publishing House, New Delhi.
40
Service Sector’s contribution to the State Economy

A Study of Nagaland
– Dr N.Martina Solo*
– Peteneinuo Angami**
Abstract
This article focuses on the status of Service Sector and its contribution to the economy
of the State of Nagaland, the objective and methodology used for the study, addresses the
limitations/problems and offers suggestions and conclusions.
Keywords: Services, Gross State Domestic Product, Employment.
1. Introduction
Nagaland, the 16th State of the Indian Union was created on the 1st of December, 1963 out
of the Naga Hills district of Assam and North Eastern Frontier Agency (NEFA) province. The
State of Nagaland has been constitutionally provided with a unique and special protection under
Article 371 (A) of the Indian Constitution to safeguard the culture, traditions and way of life of the
Nagas. The State is bounded by Assam in the North, West by Myanmar, Arunachal Pradesh in the
East and Manipur in the South and runs parallel to the bank of Brahmaputra. There are 11 districts
namely- Dimapur, kohima, Zunheboto, Mokokchung, Tuensang, Wokha, Mon, Kiphere, Longleng,
Peren and Phek.
The population of the state is 19, 80,602 lakh as per 2011 census. The density of population
in the state is 119 persons per sq. km with a sex ratio of 931:1000. The high literacy rate of the state
provides significant scope and a positive indication for Service Sector growth which inturn will
result not only in expanding the Service Sector but also will offer opportunities for socio-economic
development.
The Service Sector comprises of several segments/services either formal or informal. In
Nagaland, Service sector is composed of Transport, Storage and communication, railways, transport
by other means, trade, hotels and restaurants, banking and insurance, real estate, ownership of
* Associate Professor Department of Commerce Nagaland University Kohima Campus, Meriema.

** Research Scholar Department of Commerc e Nagaland University Kohima Campus , Meriema.
Email: petepienyupa@gmail.com
41
dwellings and business service, public administration and other services. Through this paper a
modest attempt has been made to study the scenario of Service Sector and its contribution to the
State’s Economy.
2. Objective of the Study

The primary objectives of this study are;-
1. To study the contribution of Service Sector to the State’s GSDP & NSDP
2. To assess the impact of Service Sector growth on employment.
3. To identify the problems of Service Sector growth and suggest remedial measures.
3. Methodology
The present study is descriptive one and entirely based on Secondary data collected mainly
from Statistical Handbook of Nagaland, Statistical outline of India, Tata Services Ltd, Economic
Survey of India, and report of census of State Government Employees in Nagaland. A period of ten
years has been considered for the purpose of the study.
Statistical methods used for this study includes graphs, bar diagram, percentages, trend analysis,
and Average Compound Growth rate. The Data so collected have been classified and tabulated as
per the requirement of the study inorder to draw useful inferences and conclusions.
Status of Service Sector in Nagaland

Nagaland joined the National Planning process only from the Third Five Year Plan. During
the last decade or so the State has done reasonably well in Services Sector. A look at the 11th Plan
reveals that the economy has sustained a growth rate of 10.16% of the GSDP at constant prices
from 2007-08 to 2011-12. The Service Sector or the Tertiary Sector recorded a growth of 9.37%
within which the trade, hotels and restaurants grew at 18.71% indicating substantial growth of
hospitality sector. Banking and Insurance grew at 9.30% and the real estate and dwelling have
grown at 6.83%. The sectoral contribution to the state’s GSDP & NSDP is shown in table 1.
42
Table 1: Sectoral contributions to the State’s GSDP & NSDP

Primary Secondary Tertiary Total
Year
GSDP GSDP GSDP GSDP
1999-00 28.13 13.33 58.53 100
2000-01 30.36 12.77 56.87 100
2001-02 31.35 13.14 55.51 100
2002-03 32.10 14.25 53.65 100
2003-04 31.54 14.01 54.45 100
2004-05 32.78 13.49 53.73 100
2005-06 32.64 14.29 53.07 100
2006-07 29.85 14.21 55.52 100
2007-08 27.24 14.69 58.05 100
2008-09 27.36 16.98 55.64 100
2009-10 26.37 18.16 55.46 100
2010-11 25.13 19.13 55.74 100
2011-12 23.90 20.13 55.96 100
Source: Statistical Handbook of Nagaland

*2009-2010- provisional estimate
*2010-2011- quick estimate
*2011-2012- advance estimate
From the above table, it is evident that both in terms of GSDP and NSDP, the industry sector
has contributed the least to the economy followed by agriculture while the contribution of services
sector is comparatively more the other sector. Agricultural sector contributed 28.13% to the GSDP
in 1999-00 increased to 32.64% in 2005-06 and declined to 27.36% in 2008-09. In the industrial
sector the trend showed slight variation in its contribution over the years to the GSDP. Its contribution
was 13.33% in 1999-2000 and reached 15.41% in 2005-06, it was 16.43% in 2008-09. Services
sector reveals that in 1999-2000 its contribution was 58.53%, declined to 53.07 in 2005-06 and in
2008-09 it was 55.64%.
The average compound growth rate during the study period (i.e.,) 1999-2000 to 2008-09
43
shows that the agricultural or primary sector was -0.28%, industry showed the growth rate of 2.4%
and the Services Sector showed a negative growth trend of -4.98%. Thus the growth trend for
primary and tertiary sector shows a negative growth whereas for industry it shows a positive
growth trend.
The detail Sectoral contribution to the State’s Economy during the period from 1999-2000 to
2008-2009 has been given in table 2, table 3 and table 4 respectively.
Primary or Agricultural Sector
Agriculture is the main occupation of the people in India as well in the state of Nagaland and
as such majority of the people are engaged in this sector. The contribution of various sub sectors of
primary or agricultural sector is given in table 2, Sub-sector’s like agriculture’s contribution to
GSDP is the maximum, it was 84.5% in 1999-00 and reached 90.09% in 2004-05, and remained at
76.61% in 2008-09 and 75.80% in 2011-12. Sub sectors like forestry and logging showed that it was
12.4% in 1999-00 and 7.5% in 2004-05 and 21.13% in 2008-09 and 21.78% in 2011-12. Fishing too,
was 2.8% in 1999-00, 1.3% in 2004-05 but started to rise in 2004-05 and 2005-06 and reached
1.78% in 2008-09 and 1.80 in 2011-12. Mining and quarrying showed a very minor variation, which
may be due to very negligible proportion of the workforce and economy being invested in this
sector. Even among the Primary sector, agriculture contributes the maximum and allied activities
shows only a minimal amount.
Table 2: Agriculture or primary sector contribution to GSDP & NSDP (in percentage)
Year Agriculture Forestry & Fishing Mining&

Logging Quarrying
GSDP GSDP GSDP GSDP GSDP
1999-00 84.5 12.4 2.8 0.06 100
2000-01 87.8 9.8 2.1 0.08 100
2001-02 89.3 8.5 1.8 0.1 100
2002-03 90.4 7.5 1.7 0.2 100
2003-04 90.7 7.8 1.1 0.2 100
2004-05 90.9 7.5 1.3 0.2 100
2005-06 89.5 8.8 1.4 0.2 100
2006-07 77.40 20.8 1.32 0.42 100
2007-08 76.38 21.77 1.36 0.47 100
2008-09 76.61 21.13 1.78 0.45 100
2009-10 76.04 21.66 1.77 0.52 100
2010-11 75.92 21.72 1.79 0.56 100
2011-12 75.80 21.78 1.80 0.61 100
44
Table 3: Industry or Secondary Sector contributions to GSDP & GSDP (in percentage)
Industry 1999-00 2000-01 2001-02 2002-03 2003-04 2004-05 2005-06 2006-07 2007-08 2008-09 2009-10 2010-11 2011-12
GSDP GSDP GSDP GSDP GSDP GSDP GSDP GSDP GSDP GSDP GSDP GSDP GSDP
Manufacturing 14.1 12.5 11.7 10.9 11.4 11.4 11.1 13.47 13.97 10.38 9.88 8.94 8.08
a) Registered 2.4 2.2 2.5 2.4 2.6 2.4 2.4 3.64 3.30 2.21 1.98 1.80 1.64
b) Unregistered 11.7 10.3 9.2 8.5 8.8 9.0 8.7 9.83 10.66 8.17 7.90 7.14 6.44
Construction 74.8 77.1 78.4 79.8 78.0 77.9 78.3 77.21 75.73 80.25 81.62 82.92 83.61
Electricity,
45
Water supply & 11.01 10.3 9.7 9.1 10.4 10.5 10.4 9.30 10.29 10.37 0.98 9.42 0.08
Gas
Total 100 100 100 100 100 100 100 100 100 100 100 100 100

Nagaland being a terrain and hilly area, its industrial sector is not well-developed and only
few of the people are engaged or employed in this sector. The table reveals that in 1999-00, the
manufacturing sector both registered and unregistered contributed 14.1% to the GSDP decreased
to 11.4% in 2003-04 and remained the same in 2004-05 but declined to 11.1% in 2005-06 and
10.38% in 2008-09 and 8.08% in 2011-12. Construction was the main contributor of the industrial
sector to the GSDP of the state's economy. In 1999-00 it contributed 74.8% but increased to 79.8%
in 2003-04 and showed a decline in 2003-04 to 2004-05 but rose to 78.3% in 2005-06 and 79.13%
in 2008-09 and 83.61% in 2011-12. Electricity, Water Supply and Gas showed only a small proportion
of the total percentage contribution of the secondary sector. In 1999-00, it was 11.01%, 9.1% in
2002-03, increased to 10.4% & 10.5% in 2003-04 and 2000-05 respectively, it remained at 10.4%
in 2005-06 and 10.47% in 2008-09 and 0.08% in 2011-12. The Industry or Secondary Sector is
contributing the least to the GSDP & NSDP of the state.
Tertiary Sector or Service Sector

Table 4 clearly indicates that the Service Sector or the Tertiary Sector is the highest contributor
to the GSDP & NSDP of the economy. The various sub-sectors like the transport, storage and
communication contributed 27.4% in 1999-00 to 29.7% in 2000-01, decreased to 28.6% to 25.7% in
2005-06 and it was 14.63% in 2008-09 and 12.96% in 2011-12. Trade, hotels and restaurants was
8.8% in 1999-00 and slowly increased to 9.7% in 2002-03 but was 8.8% in 2005-06 and 7.03% in
2008-09 and 8.82% in 2011 -12.Banking and insurance’s contribution was minimal among the
Services Sector or the Tertiary Sector. But this was the only sub-sector under tertiary sector to
have registered a continuous increase in its contribution to the GSDP & NSDP of the state. Its
contribution which was 1.8% in 1999-00 increased to 2.4% in 2002-03 to 2.7% in 2005-06 and
2.88% in 2008-09 and 3.04% in 2011-12.Real Estate, Ownership of Dwellings and Business Services
was 18.7% in 1999-00, 17.9% in 2001-02, to 22.7% in 2004-05, 22.4% in 2005-06 and 36.36% in
2008-09 and 34.64% in 2011-12. Public administration which was 26.6% in 1999-00 declined to
24.0% in 2004-05, increased to 25.7% in 2005-06 and 23.72% in 2008-09 and 2.69% in 2011-12.
Other services were 16.4% in 1999-00, 15.8% in 2003-04, 14.4% in 2005-06 and 15.35% in 2008-
09 and o.13% in 2011-12 .Thus showing a fluctuating trend of growth over the study period.
46
Table 4: Services or Tertiary Sector contribution in % to GSDP & NSDP
1999-00 2000-01 2001-02 2002-03 2003-04 2004-05 2005-06 2006-07 2007-08 2008-09 2009-10 2010-11 2011-12
Industry
GSDP GSDP GSDP GSDP GSDP GSDP GSDP GSDP GSDP GSDP GSDP GSDP GSDP
1. Transport,
Storage & 27.4 29.7 28.6 28.4 28.0 26.8 25.7 18.05 18.27 14.63 1.41 13.59 12.96
Communication
a) Railways 0.1 0.09 0.09 0.1 0.1 0.1 0.1 0.11 0.13 0.10 0.01 0.12 0.001
b) Transport
by Others 26.6 29.06 27.7 27.5 27.1 25.8 24.5 13.82 12.95 11.70 1.09 10.33 9.69
Mean
c) Storage
0.02 0.01 0.01 0.01 0.04 0.03 0.04 0.02 0.02 0.02 0.002 0.03 0.0002
d) Communication 0.6 0.5 0.7 0.7 0.8 0.9 1.01 4.09 5.15 2.79 0.29 3.10 3.26
2. Trade, Hotels &
8.8 9.1 9.6 9.7 9.2 9.02 8.8 5.86 6.36 7.03 0.77 8.28 8.82
Restaurants
47
3. Banking &
1.8 2.3 2.4 2.4 2.6 2.5 2.7 3.08 3.13 2.88 0.30 3.03 3.04
Insurance
4. Real Estate,
Ownership of
18.7 18.7 17.9 18.2 20.9 22.7 22.4 37.02 38.36 36.36 35.86 35.26 34.64
Dwellings &
Business Services
5.Public
26.6 25.4 25.1 25.3 24.0 24.0 25.7 20.72 19.02 23.72 24.51 25.73 2.69

Administration
6. Other Services 16.4 14.4 16.1 15.8 15.1 14.7 14.4 15.24 14.83 15.35 1.47 14.07 0.13
7. Total 100 100 100 100 100 100 100 100 100 100 100 100 100

Table 5: Service Sector growth and GSDP GSDP and Service Sector in percentage over the previous year
(Based on 1999-00 series) in lakhs
GSDP % over Service Sector %

Year GSDP Service Sector the previous over the previous
year(increase) year (increase)
1999-00 279956 163874 - -
2000-01 355181 201992 78.82 81.12
2001-02 416597 231242 85.25 87.35
2002-03 468400 251285 88.94 92.02
2003-04 503976 274399 92.94 91.57
2004-05 534642 287259 94.26 95.52
2005-06 566689 300742 94.34 95.51
2006-07 725665 402951 78.09 74.63
2007-08 807495 468793 89.86 85.95
2008-09 943607 525065 85.57 89.28
2009-10 1027288 569812 91.85 92.14
2010-11 1112100 619866 92.37 91.92
2011-12 1206453 675178 92.17 91.81
Exhibit 1:
48
Bar diagram of growth of Service Sector and GSDP over the previous year
The bar diagram and table 5 shows the percentage increase in the overall GSDP and Service
Sector increase over the previous years. The increase in the Service sector in percentage has been
more than the increase in the overall GSDP whole through out the period of study except in 2003-
04. The increase in Service Sector is indicative of the growing importance of the sector and how
this sector can have an impressive influence on the growth of the economy.
Service Sector growth and employment

In the Tertiary Sector, the main concern remains the exploding numbers of educated youths.
It is estimated that out of 19.80 lakh population, 8-10 lakhs are in the employable age. But on the
onehand, employment in the Government sector for all is not possible. On the otherhand, there are
not many industries. The job seekers on the Live Registry of the Employment Exchange shows that
out of 63,924 persons registered, only one third are below Matric and two third or over 40,000 are
educated above Matric and having a Post-Graduate and Degree in Technical and Diploma Holders
(As per the Draft Annual Plan 2012-13).
Though, agriculture continues to be the main occupation of the people. However, of late
there has been a notable decline in the proportion of working population dependant on cultivation as
a source of livelihood. Further, with the advancement of education the number of job seekers is
consistently increasing. During the past 10 years or so, there has been considerable shift; particularly
among the educated unemployed recorded in the Live Register of employment exchange as shown
in table 6.
Table 6: Number of applicants on the live register of employment exchanges as on 31st Dec’99-11
Year Male Female Total Female: Male

2001 29035 8511 37546 23:77
2002 26177 8864 35041 25:75
2003 31090 11674 42764 27:73
2004 NA NA NA NA
2005 31321 12848 44169 29:71
2006 32978 12249 45227 27:73
2007 33337 12926 46263 28:72
2008 36743 13311 50054 27:73
2009 33826 20219 54045 37:63
2010 39173 22584 61757 37:63
49
From the above table 6 it can be seen that the increase is more incase of male than the
female in the Live Register of Employment Exchange. As discussed in the preceding pages the
percentage contribution of the Services Sector to the GSDP and NSDP is the highest in the economy
with respect to primary and secondary sector. But the increased number of unemployment is
indicative of its inability to absorb the growing labour force in this Sector. The female: male ratio
indicates that in 2001 it was 23:77, female ratio increased from 27:73 in 2003 to 29:71 in 2005, the
gap between female and male ratio in 2009 & 2010 stood at 37:63 indicating the rise of female job
seekers. Adding to the numbers of job seekers in the live Registry, the numbers who are in schools
and colleges viz, 4, 11,392 in schools and 29,622 in colleges, the total comes to about 5lakhs young
people who will soon be seeking jobs. This is almost 25% of the present population of Nagaland.
Table 7: Nagaland literacy rate & India’s literacy rate from 1951-2011 censuses
Literacy rates Literacy rates

Year
(in percent) Nagaland (in percent) India
1951 10.52 18.33
1961 21.95 28.30
1971 33.78 34.45
1981 50.28 43.57
1991 61.64 52.21
2001 66.59 64.84
2011 80.11 74.04
Source: Economic Survey 2010-11

As evident from table 7 and the line graph in exhibit 2, the literacy rate in Nagaland has
shown a tremendous increase over the years. A comparative analysis between the all India level
and state of Nagaland reveals that according to census 1951 the percentage of literacy in Nagaland
was only 10.52% whereas at the Centre i.e. India it was 18.33, till 1971 census the State remained
below the Centre's percentage but from 1981 census it was 50.28% and at the National Level it
was 43.57% and it maintained its trend and remained higher than at the all India Level. In 2011
census, the percentage was 80.11% and 74.04 % respectively .The State literacy level at present is
80.11% which is higher than the National level indicating a positive contribution to Service Sector in
the State of Nagaland.
50
Exhibit 2
90
80 80.11
74.04
70
66.59
64.84
60 61.64
percentege
50 50.28 52.21 Nagaland

43.57
40 India
34.45
33.78
30 28.3
20 21.95
18.33
10 10.52
0
1951 1961 1971 1981 1991 2001 2011
Census
census
Source: Economic Survey 2010-11
Percentage of Govt. Employees of the total population of the state

The percentage of total population of the state as shown in table 8 indicates that the number
of employment provided by the Government Service sector is only about 4.19 % in 2007 which
indicates a very small percentage of the population being employed in this sector while the contribution
made by it to the GSDP is 53.07% during 2005-06.
Table 8: Percentage of Govt. Employees of the total population of the state
Total Government Percentage of the total population of the

Year
Employees State
2000 73373 6.04
2001 73291 3.68
2002 73097 3.67
2003 73483 3.69
2004 74340 3.73
2005 77652 3.90
2006 82334 4.14
2007 83398 4.19
2008 86535 4.36
2009 87541 4.41
Source: A Report on Census of State Government Employees in Nagaland: Government of Nagaland
51
The total number of Government employees as on 31.03.2000 reported by the various

departments was 73373. The total strength of the employees decreased from 73373 in 2000 to
73291 in 2001 which further declined to 73097 in 2002. The year 2005 experienced a significant
increase to 77652 and reached 87541 in 2009. In 2009 the percentage of government employees
was 4.41% of the total population of the State. It is observed that the Service Sector is not able to
absorb the growing increase of job seekers. The main employment sector in Nagaland is the
Government Service Sector except some few private institutes and entrepreneurs.
Table 9: Growth of Employees during 2000-2009
Total Govt No of Employees(Increase Percentage over
Year
employees or Decrease) the preceding year
2000 73373 - -
2001 73291 -82 -0.1
2002 73097 -194 -0.26
2003 73483 386 +0.52
2004 74340 857 +1.16
2005 77652 3312 +4.45
2006 82334 4682 +5.7
2007 83398 1064 +1.3
2008 86535 3137 +3.76
2009 87541 1006 +1.16
Source: A Report on census of State Employees in Nagaland (Directorate of Economics & Statistics)
Table 9 shows the number of total employees of the government during 2000 to 2009.
Percentage increase over the previous year in 2001 showed a decrease, in 2006 there was an
increase to +5.7 and it was + 1.16 in 2009. The growth of employees over the study period shows
that Services Sector growth has minimal impact in absorbing the growing labour force of the State.
Problems
Service sector growth has been impressive during the recent past. Its contribution to the
State GSDP is very significant. However, this sector suffers from certain limitations or problems.
1. It is observed that Service Sector is the major contributor to the State’s economy but a
minimal absorber of the employment/labour force. The growth of Service Sector is not
commensurate with employment generation. Considering the size of Service sector, it provided
comparatively lower employment opportunities.
52
2. Service related industries in the State is not well developed thus adding to an increase in the
number of educated unemployment. On the contrary, agriculture with half of the Service
Sector’s contribution to the State GSDP accounts for larger share of employment. Poor
industrial infrastructure in the State can be attributed to the increased dominance of Service
Sector as against agriculture and industries.
3. Another problem emanating from the growth of Services sector is the increased dependence
on the initiation of the Government sector and lack of initiatives of private individuals and
entrepreneurs in the areas of Service Sector. One of the striking features of Service Sector
growth in Nagaland has been the Public services controlled and managed by the Government.
Private services failed to make any significant headway in the State.
4. The lob-sided growth in the various sub sectors within the Service sector is yet another
limitation. Real estate, ownership of Dwellings and Business Services has maximum growth.
While and minimal incase of Storage, railways, communication etc recorded lower growth.
This lopsided growth is turned into balanced growth; it could a crucial contributor to the
economy of the State which so far could not be achieved.
5. The impact of Globalization on any economy is directly related to Service Sector growth. In
Nagaland, the increase dominance of service sector is independent of Globalization. The
Service sector enjoys added advantage because of the underdeveloped nature of Agriculture
and absence of large and medium size industries in the State. Therefore development due to
globalization is yet to make firm root in Nagaland.
4. Suggestions and conclusions

Service related industries can play an active role in absorbing a large number of labour
forces of the State. In a state like Nagaland with lesser scope for big industrial development
emphasis can be laid on Service Oriented development. Private individuals and entrepreneurs can
play a crucial role. Service sector can contribute significantly to the economy by serving as a base
for other sectors. Since development in Service Sector would significantly increase agriculture and
industry related activities like IT, trade, roads, transport and communication etc Most developed
economies have over two third of their contribution to the GSDP coming from Services. Thus in
Nagaland where around half of its contribution to GSDP comes Services has further scope for
developing this sector furthermore. Globalization can have a tremendous impact on the Service
sector and further employment growth in the service sector.
There is clearly a positive relationship between the level of Service sector development and
GSDP of the State hence efforts should be made by both public and private sectors as well as the
policy makers of the State for developing this sector.. Foreign direct investment can be encouraged
so as to increase the growth in Service Sector and service related activities.
53
The findings suggests that is considerable scope for rapid growth in Services Sector and the
relatively jobless nature of growth in Nagaland’s Services sector emphasizes the need for development
of agriculture and industry as well. Development in the Service Sector serves this purpose as it has
both forward and backward linkages. Therefore a balanced growth in all the sectors can be
encouraged.
Thus, it is evident that the growth of Service sector will help in the growth of Agriculture and
Industries and thereby can contribute to the overall improvement of the economy. It is only a matter
of proper policy and approach that would guide the development pattern based on Service Sector
growth. The comparative advantage of Service Sector in the State of Nagaland is a blessing in
disguise because all round development strategy can evolve out of this sector.
References
1. Bhattachargee, C: Service Sector Management; An Indian perspective, Jaico Publishing
House
2. Banga, Rashmi : Critical issues in India’s Service Led- growth; Working Paper No.171 (Oct
2005) Source: Internet
3. Annual Administrative Report: Department of Tourism; Government of Nagaland
4. Nagaland Basic Facts: Published by Directorate of Information and Public Relations;
Government of Nagaland
5. Statistical Handbook of Nagaland: Government of Nagaland
6. Economic Survey of India: Government of India
7. Eichengren Barry, Gupta Poonam : The two waves of Service Sector Growth; NBER Working
paper series 14968(May 2009)
8. Barry Eichengreen, University of California at Berkeley; Poonam Gupta, ICRIER, New
Delhi The Service Sector as India’s Road to Economic Growth.
9. State Focus Paper (2010-2011) NABARD, Nagaland Regional Office, Dimapur
10. Draft Annual Plan 2012-13, Government of Nagaland
54
Key Dimensions of Employee Engagement

A Study on Hyderabad Organized Retailing
– Urmila Jagadeeswari Itam*
– Dr Sapna Singh**
Abstract
Purpose – The paper is an attempt to measure the level of employee engagement in
organized retail sector in Hyderabad. Also, to study the variation of employee engagement
with the change in key dimensions such as work and personal life, stress and training.
Design/Methodology/Approach – The study is adopted structured questionnaire to
collect the primary data. Gallup questionnaire is used to measure the level of employee
engagement in organized retail sector in Hyderabad. Non-probability sampling is used for
selecting the retail employees for the data collection. Correlation, Multiple Regression and
Analysis of Variance are applied through SPSS and Excel.
Findings – Organized retail employees are able to balance work and personal life at
75.2% level and able to manage stress at 79.4% level. Retail stores are able to impart 78.4%
in terms of skills-set which are required to do the job. Male employees are more engaged
than female employees in the sector. The present level of employee engagement is 79.30%
in Hyderabad organized retail sector. Work and personal life, stress and training are positively
correlated with the employee engagement and statistically significant at one tail test.
Practical Implications – The study can help to understand how employee engagement
varies with the change of key dimensions and present level of engagement. So that retail
companies can focus on the key dimensions to improve the engagement level in enhancing
customer satisfaction.
Originality/Value – This research paper tries to measure the level of employee
engagement in Hyderabad organized retail sector. It explains the variation of employee
engagement with work-life balance, stress and training and its impact on employee
engagement.
Keywords – Organized retailing, employee engagement, Training, Work-life Balance,
Stress.
* Research Scholar, School of Management Studies, University of Hyderabad, Central University PO, Gachibowli,
Hyderabad – 500046. Mobile: 9966422365. E-mail: urmilaitam@gmail.com
** Reader, School of Management Studies, School of Management Studies, University of Hyderabad, Central University
PO, Gachibowli, Hyderabad – 500046. Mobile: 9849153941. E-mail: ssingh9191@gmail.com
55
1. Introduction
India is undergoing sea changes in the organized retail scenario. The Indian retail has
experienced high growth over the last decade with a noticeable shift towards organized retailing
formats. Here, it is noteworthy that the retail sector of India contributes about 15% to the national
GDP, and it is a second largest employer, next only to agriculture sector. AT Kearney (a globally
famous international management consultancy) recognized India as the second most alluring and
thriving retail destination of the world, among other thirty growing and emerging markets. The
ongoing changes i.e., Foreign Direct Investment (FDI) in retail, especially allowing 100% FDI in
single brand and multi-brand is making it the most happening sector in the Indian economy.
2. Literature Review and Significance of the study

History records that about 2300 years ago, Alexander (356BC-323BC) was able to march
ahead and conquer unknown lands by battling for years across continents, miles away from home,
because he had an engaged army that was willing to abide by its commander. He is known to have
the engaged workforce that he spent face time with his men, listening and addressing grievance,
ensuring on time payment of salary, dressing like the rest of his army and most importantly by
leading from front. More recently, in World War II, American funded a lot of money for researching
the behavior of its soldiers to be able to predict their battle readiness. History is dotted with examples
of leaders who have led their men by building a psychological commitment between their men and
their ideology to achieve greatness. In this psychological contract lies the root of today’s employee
engagement theories propounded by organizations.
According to Schmidt (1993), employee engagement is a modernized version of job satisfaction
and it is a part of employee retention. Various consultancy companies and writers gave their opinion
on engagement in many ways and few among which gives meaning to the today's retail environment
engagement process. According to Harter (2002), engagement is an element of broader category
of ideas known as well-being at work, which embraces emotional and cognitive elements. He
views engagement as a driver of intermediate outcomes such as job satisfaction, commitment,
fulfillment, caring and positive behaviors. Tower Perrin(2003) points out that engagement is an
invoking emotion and rational factors relating to work and the overall experience of work: emotional
factors are linked with ‘staff satisfaction , a sense of inspiration and the affirmation they get from
their work and from being part of the organization’. Rational factors relate to people’s understanding
of their job, the unit for which they work and how their performance relates to business performance.
Training employees, especially those in the retail sector, can be a challenging task for companies.
Due to the busy nature of retail, it is difficult to find time to train new employees, whether it is in the
classroom or on the sales floor. As Obarski (2006) points out, “the average retail company spends
less than $100 per year per employee on training.” This is a daunting fact that many retailers must
realize and address. According to previous studies, work-life balance remains a priority for employees
56
despite the current economic climate. Working long hours is quite common for employees in retailing.
So, balancing work and personal life is quite challenging task for retail employees and it leads to
stress. Hence, it is inevitable to address these problems in the growing organized retail sector.
3. Objectives of the study

• To measure the level of employee engagement in organized retail sector
• To study the variation of employee engagement with the change of work and personal life,
stress and training
4. Hypotheses
• H1: There is a significant correlation between Employee Engagement and Work Life in
Organized Retail Sector in Hyderabad
• H2: There is a significant correlation between Employee Engagement and Training in
Organized Retail Sector in Hyderabad
• H3: There is a significant correlation between Employee Engagement and Stress in Organized
Retail Sector in Hyderabad
• H4: There is a significant impact of Work and Personal Life, Stress and Training on Employee
Engagement in Hyderabad Organized Retail Sector.
5. Methodology
To fulfill the objectives of the study, primary data is collected form 86 employees of organized
retail stores in Hyderabad by administering the structured questionnaire. The employees are selected
by adopting the non-probability sampling technique. Majority of the respondents constitutes working
employees of various retail stores in Inorbit mall, Hyderabad. Engagement, Work and personal life,
training and stress related questions are included in the questionnaire by adopting Linkert 5 point
scale (1-Strongly Disagree to 5-Strongly Agree). The secondary data is collected from various
refereed journals. Gallup Questionnaire model is adopted to measure the level of employee
engagement. Maximum score 60 (12x5) is assigned for calculating the level of employee engagement.
Correlation, Multiple Regression and Analysis of Variance are using SPSS.
6. Results and Discussions

Table 1 represents respondents’ age and gender classification. It also represents the mean
values of employee engagement, work and personal life, stress and training based on the age group
and gender classification. As per the finding, 31.4% and 52.33% of the respondents are in the age
groups of less than 20 and 21 to 30 years respectively. It means 83.73% of the employees are less
than 30 years. It implies that the industry employees are dominated by youth. Also, it can be
57
observed that 54.7% and 45.3% of respondents are female and male respondents. So, female
employees are more in the industry according to the study.
Table 1: Cross Tabulation
Age Group Employee

Gender Work Life Work Stress Training
(Years) Engagement
Less than 20 Male 2 37.5 2 4 3.5
Female 25 44.04 3.64 4.04 3.68
21 to 30 Male 29 49.59 4 3.9 4
Female 16 45.25 3.81 4.13 3.93
31 to 40 Male 5 39.2 2.8 3 3.2
Female 4 41.75 4 3.5 3.5
40 to 50 Male 3 45.67 4.33 4 4
Female 2 50 4 3 4.5
A. Correlation Analysis
Table 2 shows the mean, standard deviation and inter-correlation of the variables. The standard
deviation clearly shows employees do not differ in their engagement levels, work and personal life,
training and stress significantly. The findings from the study reflect that variables are positively
correlated with each other. Firstly, work and personal life is correlated with employee engagement
(r = 0.317, p < 0.01) providing the support for H1. Thus, it implies that balancing of work and
personal life will result in improving their engagement levels. Secondly, it can be observed that
stress is correlated with employee engagement (r = 0.309, p < 0.01). Therefore, it supports H3 and
makes clear that stress influences for employee engagement. Thirdly, it can also observed that
training is also correlated with employee engagement (r = 0.369, p < 0.01). Thus it supports H2 and
makes it clear that training programs are very important and necessary for the improvement of
employee engagement.
Table 2: Correlationsa
Employee Engagement Work Life Work Stress Training
Mean 47.5814 3.7558 3.9651 3.9186
Std. Deviation 5.8741 0.96937 0.87377 0.96058
Employee Pearson Correlation 1 .317** .309 ** .369**
Engagement Sig. (1-tailed) 0.001 0.002 0
Sum of Squares and
2932.93 153.209 134.744 177.07
Cross-products
Covariance 34.505 1.802 1.585 2.083

58
B. Regression Analysis
The Regression Analysis is performed to explain the amount of variation between employee
engagement and the variables under the study. Using the step-wise regression analysis the following
five models are obtained. In order to test the study hypothesis employee engagement is regressed
simultaneously on work life, stress and training. As the results from table 3 indicate that work life,
stress and training gives significant amount of variation in employee engagement and it supports
H4. The variation is explained with the help of the regression equations given below and it is shown
in the figure 1, 2, 3 and 4.
Model 1
Employee Engagement = 47.57581 + 0.001486 (Work and Personal Life)
Model 2
Employee Engagement = 47.57521 + 0.001577 (Training)
Model 3
Employee Engagement = 39.3485 + 2.07633 (Stress)
Model 4
Employee Engagement = 38.73038 + 0.001261 (Work and Personal life) + 2.257507 (Training)
Model 5
Employee Engagement = 47.30262 - 0.00015 (Work and Personal Life) + 0.030574 (Training)
+ 0.040231 (Stress)
Table 3: Impact of key dimensions on Employee Engagement - ANOVAb
Model Sum of Squares df Mean Square F Sig.
1 Regression 692.476 3 230.825 8.448 .000a
Residual 2240.454 82 27.323
Total 2932.930 85
a. Predictors: (Constant), Work Stress, Training, Work and Personal life; Dependent Variable:
Employee Engagment.
7. Findings of the Study

• Organized retail employees are able to balance work and personal life at 75.2% level and
able to manage stress at 79.4% level.
59
• Organized Retail employees are imparted training (Skill-set) at the level of 78.4%.
• Male employees are more engaged than female employees in the sector.
• The present level of employee engagement is 79.30% in Hyderabad organized retail sector.
• Work and personal life, stress and training are positively correlated with the employee
engagement and statistically significant at one tail test.
• There is no significant difference of work-life balance and stress between gender and age
group.
• There is a significant difference of skills-set by training between age groups.
• The variation of employee engagement with work life, stress and training is highly significant.
Conclusions
The study reveals that the organized retail employees are moderately engaged i.e., at 79.30%
in Hyderabad. The analysis of variance and regression proved that there is a highly significant
variation of employee engagement with work-life balance, stress and training. Hence, there is a
significant impact of key dimensions on employee engagement.
Appendix
Figure 1
Figure 2
60
Figure 3
Figure 4
References
1. Abrahamson, M., & Anderson, W. P. (1984). People’s commitments to institutions. Social
Psychology Quarterly, 47, 371-381.
2. Borman, W. C., & Motowidlo, S. J. (1997). Task performance and contextual performance:
The meaning for personnel selection research. Human Performance, 10, 99-110.
3. Hackman, J. R., & Lawler, E. E. (1971). Employee reactions to job characteristics. Journal
of Applied Psychology Monograph, 55, 259-286.
4. Harter, J. K., Schmidt, F. L., & Hayes, T. L. (2002). Business-unit-level relationship between
employee satisfaction, employee engagement, and business outcomes: A meta-analysis. Journal
of Applied Psychology, 87, 268-279.
5. Kahn, W. A. (1990). Psychological conditions of personal engagement and disengagement
at work. Academy of Management Journal, 33, 692-724.
6. Meyer, J. P., Becker, T. E., & Vandenberghe, C. (2004). Employee commitment and motivation:
A conceptual analysis and integrative model. Journal of Applied Psychology, 89, 991-1007.
7. Ramsay, C. S. (2006, May). Engagement at Intuit: It’s the people. In J. D. Kaufman (Chair),
Defining and measuring employee engagement: Old wine in new bottles? Symposium
conducted at the Society for Industrial and Organizational Psychology 21st Annual Conference,
Dallas, Texas.
8. Robinson, D., Perryman, S., & Hayday, S. (2004). The drivers of employee engagement.
IES Report No. 408. Brighton, UK: Institute for Employment Studies.
61
Impact of FDI on Retailing

A Multi Dimensional Approach
- Mrs. Sudha Vemaraju *
Abstract
The waves of changes in Indian Retail Sector over the past has resulted in many
issues and challenges for the retail industry, the very recent being the FDI policy in India.
The retail industry is expected to grow at a rate of 14% by 2013. According to the McKinsey
report (2010) titled ‘The Bird of Gold’, the rise of India's consumer market shows that by
2025, India would be the world's fifth largest consumer market, with the middle class
comprising 41% of India’s population at a staggering 583 million people, controlling 59%
of India’s consumption power. According to AT Kearney 2011 India has been rated as the
favourite retail destination for global players. A customer centric revolution has been
transforming the ways retailers (organized & unorganized) are thinking and re-designing
strategies and added to this the debate on cards is allowing FDI in multi-brand retailing in
India became important viewpoint from customers, retailers and economy as a whole. In
this context the present paper throws light on analyzing the impact of FDI policy in three
critical areas like:
• Customers perceptions on Impact of FDI in retailing.
• Impact of FDI on retailers(organized & unorganized).
• Impact of FDI on economy.
Keywords: Foreign direct investment, Multi-brand retailing, customers, Organized &
Unorganized retailers.
1. Introduction
The phenomenal growth and change in the India Retail Sector over the years has resulted in
many issues and challenges for the retail industry, the very recent being the Foreign Direct Investment
policy in India. The first step towards allowing Foreign Direct Investment in Retail was taken in the
year 2006. Foreign direct investments have become the major economic driver of globalization,
accounting for over half of all cross-border investments. Since then 54 FDI approvals have been
granted by the government and the country has received a cash inflow to the tune of about ` 901.64
crore.
The Indian retail sector is mainly divided into: - 1. Organized and 2. Unorganized Retailing.
Organized retailing refers to business activities undertaken by licensed retailers, who pay sales tax,
* (M.B.A, M.Phil,(Ph.D)), Research scholar J.N.T.U.H, Mail id: diwan.sudha@gmail.com, Ph No : 9000462678.
62
income tax etc. These include the corporate-backed hypermarkets and retail chains, and also the
privately owned large retail businesses.
Unorganized retailing, on the other hand, refers to the traditional formats of low-cost retailing,
for example, the local kirana shops, owner manned general stores, paan/beedi shops, convenience
stores, hand cart and pavement vendors, etc. The Indian retail sector is highly fragmented with
97% of its business being run by the unorganized retailers. The organized retail however is at a very
nascent stage. The sector is the largest source of employment after agriculture, and has deep
penetration into rural India generating more than 10% of India’s GDP. (India’s Retail Sector, Dec
21, 2010).
Modern formats of retailing have evolved as a new cutting edge in services sector in last few
years and offering high value proposition to shoppers including price discounts and better service.
With increasing share of organized retailing in India, the retailers have been experimenting in designing
profitable business models, sustaining service quality & delivery levels. India’s consumer market is
going to be the world’s 5th largest by 2025 (McKinsey report 2010), this will happen because of the
increasing middle class population which is expected to grow to 41% of India’s population at a
staggering 583 million people, controlling 59% of India’s consumption power. This massive consumer
base has attracted many established foreign retailers to consider India as a retail destination. Moreover,
after allowing FDI in multi-brand retail in India, the competition from foreign retailers is going to
increase multifold and the servicescape in retail will go through a sea change.
This would change the face of the retail sector. In this context, the present paper attempts to
analyze the various factors concerning the influx of foreign direct investment its repercussions on
customers, retailers, economy as a whole and highlights the challenges and opportunities of FDI
policy in Indian retail industry.
2. Need for the Study

In developing countries like India, the unorganized retailers play a dominant role by offering
products or services to the consumers at the convenient locations with effective selling and buyer’s
retention strategies. The phenomenal growth and change in the Indian retail sector over the years
has resulted in many issues and challenges for the retail industry, the very recent being the Foreign
Direct Investment policy in India. This would change the face of the retail sector. But due to the
recent changes in the field of retailing and with the entry of big domestic players, MNC’s and giant
foreign players into the field of retailing, the existing unorganized retailers have also been forced to
change their existing business structure. The perception of consumers, retailers, academicians and
policy makers in respect of the organized and unorganized retailers are changing. The organized
and unorganized retailers are also in a dilemma about the perception of the different segments as
mentioned above. There is a huge debate going on the current FDI policy where some argue, FDI
would be a boon to Indian retail sector and others contradict that it would be a curse.
63
In this context, the present paper attempts to analyze the various factors concerning the
influx of foreign direct investment its repercussions as well as the opportunities for FDI in the
Indian retail industry. Because of these kinds of issues emerging in today’s retail markets, this topic
has become very important, which needs an exhaustive study to understand the impact of FDI in
three critical areas like:
• Customers perception of FDI on retailing
• Impact of FDI on traditional retailers
• Impact of FDI on economy

Having immense potential and current status of the entry of the global giants to Indian retail
industry, this paper focuses on the Indian retail story with the objective of highlighting some of the
major areas which would have impact on FDI in retailing.
The objectives of the paper are:
1. To evaluate customers viewpoint on FDI in Indian retailing.
2. To understand the overview of three dimensions of FDI in retail sector – Challenges,
opportunities and key success factors.
3. To review the impact of FDI policy on Organized and Unorganized retail Sector.
4. To emphasize on the various issues, changes and influence of current FDI policy on economy
as a whole.
RESEARCH GAPS
Earlier studies have focused on various issues of the current FDI policy on retailing but no or
very few studies have focused this from view point of customers. As we know customers are the
key driving factors for success or failure of any business this study throws light on such unexplored
area and hence becomes a multi dimensional approach on impact of FDI on retailing in Indian
context.
FDI as defined in Dictionary of Economics (Graham Bannock et al) is investment in a
foreign country through the acquisition of a local company or the establishment there of an operation
on a new (Greenfield) site.
FDI refers to capital inflows from abroad that is invested in or to enhance the production
capacity of the economy. (Hemant Batra, 2010).
64
5. Regulatory Bodies of FDI in India

Foreign Investment in India is governed by the FDI policy announced by the Government of
India and the provision of the Foreign Exchange Management Act (FEMA) 1999. The Reserve
Bank of India (‘RBI’) in this regard had issued a notification. (FEMA, 2000) which contains the
Foreign Exchange Management (Transfer or issue of security by a person resident outside India)
Regulations, 2000. This notification has been amended from time to time. The Ministry of Commerce
and Industry, Government of India is the nodal agency for motoring and reviewing the FDI policy
on continued basis and changes in sectoral policy/sectoral equity cap. The FDI policy is notified
through Press Notes by the Secretariat for Industrial Assistance (SIA), Department of Industrial
Policy and Promotion (DIPP). The foreign investors are free to invest in India, except few sectors/
activities, where prior approval from the RBI or Foreign Investment Promotion Board (‘FIPB’)
would be required. The Government of India identifies the significant role played by foreign direct
investment in accelerating the economic growth of the country and thus started a swing of economic
and financial reforms in 1991. India is now initiating the second generation reforms intended for a
faster integration of the Indian economy with the world economy. As a consequence of the
introduction of various policies, India has been quickly shifting from a restrictive regime to a liberal
one. Now FDI is also encouraged in most of the economic activities under the automatic routes.
FDI POLICY IN RETAILING
According to DIPP, 2012 the sector specific guidelines for FDI with regard to the conduct of
trading activities are:
1. FDI up to 100% for cash and carry wholesale trading and export trading allowed under the
automatic route.
2. FDI up to 51% with prior Government approval (i.e.,) ‘Foreign investment promotion board’
for retail trade of ‘Single Brand’ products.
3. FDI is not permitted in Multi Brand Retailing in India.
FDI inflows in India are allowed under five broad categories

i. Foreign Investment Promotion Board’s (FIPB) discretionary approval route for larger
projects.
ii. Reserve Bank of India’s (RBI) automatic approval route.
iii. Acquisition of shares route (since 1996).
iv. RBI’s non - resident Indian (NRI’s) scheme.
v. External commercial borrowings (ADR/GDR) route.
65
EVOLUTION OF FDI
a. The first phase, between 1969-1991, was marked by Monopolies and Restrictive Trade
Practices Commission (MRTP) in 1969, which imposed restrictions on the size of operations,
pricing of products and services of foreign companies.
b. The second phase, between 1991-2000, witnessed the liberalization of the FDI policy, as part
of the Government’s economic reforms program. In 1991 as per the ‘Statement on Industrial
Policy’, FDI was allowed on the automatic route, up to 51%, in 35 high priority industries.
c. The third phase, between 2000 till date, has reflected the increasing globalization of the
Indian economy. In the year 2000, a paradigm shift occurred, wherein, except for a negative
list, all the remaining activities were placed under the automatic route.
IMPACT OF FDI IN RETAILING

Studies on FDI: Pessimistic approach (Half Empty Glass)
They have mostly focused more on opening stores in a drive to capture market share than on
making supply chain improvements and operational efficiencies (Singh and Singla 2011; Dutta
2011). This may not change even with FDI in MBRT though 50% investments in back-end
infrastructure is a reasonable condition.
Some recent studies have recognized technology, labour skills and infrastructure as
determinants of foreign investment. If these determinants are not recognized, it will be difficult to
explain some of the patterns in 56 the geographical structure of FDI at the world capita income, in
relation to outbound as well as inbound FDI (Hummels and Stern, 1994).
Honourable Department Related Parliamentary Standing Committee on Commerce, in its
90th Report, on ‘Foreign and Domestic Investment in Retail Sector’, laid in the Lok Sabha and the
Rajya Sabha on 8 June, 2009, had made an in-depth study on the subject and identified a number of
issues related to FDI in the retail sector. These included:
• Unfair competition and ultimately result in large-scale exit of domestic retailers, especially
the small family managed outlets, leading to large scale displacement of persons employed in
the retail sector.
• Further, as the manufacturing sector has not been growing fast enough, the persons displaced
from the retail sector would not be absorbed there.
• Organized retail, is still under-developed and in a nascent stage and that, therefore, it is
important that the domestic retail sector is allowed to grow and consolidate first, before
opening this sector to foreign investors.
66
• The entry of large global retailers such as Wal-Mart would kill local shops and millions of
jobs.
• Global retailers would conspire and exercise monopolistic power to raise prices and
monopolistic (big buying) power to reduce the prices received by the suppliers and it would
lead to asymmetrical growth in cities, causing discontent and social tension elsewhere. Hence,
both the consumers and the suppliers would lose, while the profit margins of such retail
chains would go up.
Studies on FDI: Optimistic approach (Half Full Glass)

• Supporters of FDI in retail trade argue that liberalization will benefit multiple economic agents
along the supply chain.
• Farmers may benefit from having the option of selling directly to organized retailers. The
prevalence of intermediaries that make the link between farmers and (unorganised) retailers
inflates prices and reduces transparency along the supply chain. Allowing farmers to sell
directly to organised retailers reduces the role of intermediaries and increases profit margins
for both farmers and retailers. Indirectly, farmers will also gain from the much needed
investments aimed to improve the efficiency of the marketing system such as investment in
post-harvest cold-chain and storage infrastructure in a context in which at the present time
post-harvest waste and loss are significant due to the lack of adequate facilities.
• Finally, consumers are expected to be the main beneficiaries of the liberalisation of foreign
entry in the retail sector through improvements in price and quality and access to a wider
range of varieties. Existing research found that with entry of foreign firms in organised retail
overall consumer spending increases and while all income groups improve their purchasing
power, lower income consumers benefit the most (Joseph et al., 2008).
6. Methodology of the Study

The present study is an analytical one. It uses both primary and secondary sources of data.
• The primary data has been obtained using questionnaire method administered at Hyderabad
for evaluating the viewpoint of customers on impact of FDI policy in Indian retailing.
• For analyzing the impact of FDI on retailers and economy as a whole secondary data sources
from various published electronic sources like books, bulletins, sectoral reports, journals,
browsers, websites and online databases were used.
• Sample size: The sample consisted of 100 customers basically who have little awareness
about FDI.
• Sample design: For the purpose of selecting the sample, convenience random sampling was
used in this study.
67
• Statistical tools: Various attributes which are influenced by FDI policy are chosen and analyzed
using Likert’s five point scale from strongly agree to strongly disagree. The final scores has
been calculated using weighted ranking method.
7. LIMITATIONS OF THE STUDY

• The study was exploratory in nature and used only a small sample of 100 respondents.
• The study used primary data only to analyze the viewpoint of customers on FDI in retailing
and all the others were analyzed using secondary data sources
• The study is limited only to Hyderabad and hence cannot be a representative of entire
population.
Part 1: Analysis & Findings

Half empty & Half Full Approach
ON FOREIGN DIRECT INVESTMENT

So the current FDI policy is viewed by various academicians, customers and retailers in two
different ways.
68
1. Optimistic approach (Half full glass): Positive vibrations of FDI in various areas.
2. Pessimistic approach (Half empty glass): Negative vibrations of FDI in retailing.
From the above literature the positive sides of FDI in retailing are
• Increase in employment opportunities
• Improves supply chain management
• Technology up gradation
• Tourist development
• Upgradation of agriculture
• Increase efficiency in small and medium scale industries
• Growth in market size and greater productivity
• Benefits to economy through greater GDP
• Tax income and employment generation
• Farmers get better prices
Negative sides of FDI in retailing are

• Unfair competition and ultimately result in large-scale exit of domestic retailers, especially
the small family managed.
• Organized retail is still under-developed and in a nascent stage and that, therefore, it is
important that the domestic retail sector is allowed to grow and consolidate first, before
opening this sector to foreign investors.
• The entry of large global retailers such as Wal-Mart would kill local shops and millions of
jobs.
• Global retailers would conspire and exercise monopolistic power to raise prices and
monopolistic (big buying) power to reduce the prices received by the suppliers and it would
lead to asymmetrical growth in cities, causing discontent and social tension elsewhere. Hence,
both the consumers and the suppliers would lose, while the profit margins of such retail
chains would go up.
• It will mainly cater to high-end consumer placed in cities and metros but ignores customers
in villages and small towns.
69
Part- 2: Analsysis and Findings
Table 1 : Demographic Profile
Demographic
Characteristics Frequency %
Factors
Age Below 25 4 3.92%
25-35 33 32.35%
35-50 37 36.27%
51 and above 28 27.45%
Gender Male 64 62.75%
Female 38 37.25%
Education Under Graduate 3 2.94%
Graduate 46 45.10%
Post Graduate 53 51.96%
Martial status Unmarried 25 24.51%
Married 77 75.49%
Family Size Below 4 members 62 60.78%
4 to 6 36 35.29%
More than 6 4 3.92%
Occupation Student 3 2.94%
Business 30 29.41%
Professional 40 39.22%
Service 27 26.47%
Others 2 1.96%
Annual Income Rs.10,000 and below 6 5.88%
Rs.10,000 to Rs.25,000 22 21.57%
Rs.25,000 to Rs.50,000 46 45.10%
Rs.50,000 and above 28 27.33%
Source: Questionnaire
• From the above table it is clear that majority of the respondents are young people (36.27%)
educated (53%) and males (64%).
70
• Majority of the respondents are professionals (40%), married (77%) with family size (62%)
below four members and earn annual income(46%) between 25000-50000 rupees.
Do you think the new FDI Policy will have an impact on the following?
Kindly rate your preferences.
Table 2 : Customers Perceptions on Impact of FDI
Neither Position
Strongly Strongly Weights
S.No Description Disagree Agree nor Agree Rank
Disagree Agree
Disagree
1 Increase the
8 20 24 40 10 282 1
prices
2 Improves
5 11 15 45 26 230 4
quality
3 Brings
innovation in 0 3 15 22 62 163 7
products
4 Increase
1 4 11 32 54 172 5
competition
5 Improve
0 3 7 40 52 165 6
service scape
6 Technology
0 0 3 42 55 148 10
upgradation
7 Improves
supply chain 0 0 2 55 45 161 9
management
8 Increase
variety and 0 0 2 56 44 162 8
assortment
9 Increase
Growth in 5 12 24 36 25 242 2
economy
10 Effects
unorganized 2 18 22 26 34 234 3
sector
Source: Questionnaire
• From the above table we can analyze that customers perceive that the current FDI
policy would increase the prices of products and result growth in the economy.
• Customers also perceive that the current FDI policy would affect the unorganized
retailers and improves the quality of products. These were the important factors
customers perceive to have profound impact due to the current FDI policy.
71
• Supply chain management and technology up gradation were having less significance
in customers point of view.
8. Suggestions & Conclusions

A rational approach would be not to throw the baby in water and examine the specific issues
and attach conditions that neutralize the negative impact as apprehended by many.
Hence the presence of global retailers in Indian retailing must not be completely viewed in
optimistic or pessimistic way but to handle through idealistic approach in various steps:
• Firstly the global retailer's should not hinder the aspirations of Indian farmers and consumers.
FDI - Retail should be a process of integrating Indian economy to the global economy as well
as farmers can be integrated into the world class retail market not on the mercy or control of
global retail giants.
• The Government should make sure that the farmers will receive the reasonable prices.
• Global retailers should be mandated to work with farmers to improve yields by enabling them
provide quality inputs, best farm technologies, timely credit and remunerative prices for their
produces.
• Government needs to support farmers to meet the needs of modern supply chains and
marketing systems to enable with the supermarket sector.
• Government should ensure that the agro produces should be procured from the local producers
and local people must be given priority in employment opportunities in processing and supply
chain.
• Lastly to put into a nutshell, the idealistic way to see is not whether local or foreign retail
players leads this next wave of retail revolution in India but to see Indian consumer benefits
in terms of way in to innovative retails formats, best practices and gains from new servicescape
from all over the world along with great shopping experience.
References
1. Central Statistics office estimates for 2008-2009
2. Joseph, M., N. Soundararajan, M. Gupta, and S. Sahu (2008). Impact of Organized Retailing
on the Unorganized Sector. Technical report, Indian Council for Research on International
Economic Relations.
3. Chari, A. and T. C. A. M. Raghavan (2012). Foreign Direct Investment in India’s Retail
Bazaar: Opportunities and Challenges. The World Economy 35 (1), 79-90.
72
4. DIPP (2010). Foreign Direct Investment (FDI) in Multi-Brand Retail Trading. Discussion
paper, Ministry of Commerce and Industry Government of India.
5. A.T. Kearney, (2006) “Retail in India - Getting organized to drive growth”.
6. DIPP. (2010), Discussion paper on foreign direct investment (FDI) in multi-brand retail trading,
Department of Industrial Policy and Investment Promotion, New Delhi.
7. http://www.thehindu.com/business/Economy/fdi-in-retail-not-a-threat-to-kirana-shops-
montek/article3929250.ece accessed on October 29th ,2012
8. http://www.cci.gov.in, accessed on November 1st, 2012
9. Reardon, T. and J.A. Berdegué. (2007), “The Retail-Led Transformation of Agrifood Systems
and its Implications for Development Policies”, Background Paper prepared for the World
Bank’s World Development Report 2008: Agriculture for Development, Rimisp and MSU:
January.
10. Reardon, T. and R. Hopkins (2006), “The Supermarket Revolution in Developing Countries:
Policies to Address Emerging Tensions among Supermarkets, Suppliers and Traditional
Retailers”, The European Journal of Development Research, vol. 18, No. 4, pp. 522-545.
11. India’s Retail Sector (Dec 21, 2010) http://www.cci.in /pdf/surveys _reports/ India’s _
retail_sector.pdf.
12. National Accounts Statistics, 2009.
13. Notification No. FEMA 20/2000-RB dated May 3, 2000.
14. Mookerji, N (2011): “A Whole New Opportunity”, Business Standard, the Strategist, 28
November, pp 1-3.
15. Pulamte, L (2008): “Key Issues in Post Harvest Management of Fruits and Vegetablesin
India”, downloaded from, on 13/09/11.
16. Singh, S (2011): “Controlling Food Inflation: Do Supermarkets Have a Role?”, Economic &
Political Weekly, 46(18), 19-22.Singh, S and N Singla (2011): Fresh Food Retail Chains in
India: Organisation andImpacts(New Delhi: Allied).
73
Strategy Preceeds Structure Vs Structure Preceeds

Strategy For Purchase Decision of Consumers
A Study on Food Retail Stores in Semiurban Areas of Andhra Pradesh
– Srivalli Jandhyala*
Abstract
The Global India is seventh largest country, second in population and one of the
leaders in terms of trading, retailing, exporting and importing in the world. Retail
management involves understanding consumer behavior in a way that drives them to
purchase supplier products. Indian consumers have raised great interest to health, hygienic
nutritional compounds in consumption of food. Different retailers have identified,
implemented their different strategies and structures in attracting and making urban
consumers to be their family. This made retailers to extend their stores from urban areas to
semi urban areas in India. The present paper derives whether strategy precedes structure or
structure precedes strategy in attracting semi urban consumers, In strategy and structure
which are the factors that influenced consumer behavior in visiting retail stores in semi
urban areas in India.
Keywords: Consumer Behavior, Semi urban areas, Strategy, Structure, Shopping,
Food and Grocery.
1. Introduction
The fact that about 72% of the Indian population resides in hinterlands brings home the point
that the Indian consumer base is highly supported by the rural population; which is eventually
driving revenues for many major conglomerates operating in diverse markets in India. Companies
across sectors such as fast moving consumer goods (FMCG), telecom, pharmaceuticals, banking,
retail and even cosmetics are devising strategies to attract the rural chain.
Literacy
India 2011 Male Female
Male Female
Semi urban 10.34 11.02 9.64 86.39 67.36
urban 23.67 21.99 25.58 93.79 85.44
Source: Census 2011
Food retail industry is one of the fastest growing businesses in Indian Economy. In terms of
retail development Index India ranks fifth and in Asia it occupies second position .The retail market
* Jawaharlal Technological University, Hyderabad.
74
contributes about 14% to the Indian GDP.There are different strategies followed by organized
retailers to attract consumers from any part of the world .The major assets of retailers are strategy
and structure they built. Retailers have made their best and succeeded in attracting urban consumers
making their business stable.
Image:1 showing relation of food retail store, strategy, structure and urban and semi urban
areas
STRATEGY precedes STRUCTURE
FOOD RETAIL STORES
URBAN AREAS SEMIURBAN AREAS
2. Literature Review
Webster (1994) calls this the building block of strategic management and notes that a secure
foundation (strategy) is needed if the process (strategic management) is to function properly. Most
organizations began their strategic planning cycle by updating and revising their business objectives
in relation to performance reviews in key areas (such as people, standards and business development),
achieved results and development priorities (Storey and Teare, 1991; Teare et al., 1992). Strategic
analysis is primarily concerned with deriving an understanding of the strategic situation which any
given organization faces (Johnson and Scholes, 1993) and the tasks involved can be viewed in
relation to three sub-areas: external analysis, internal analysis and culture and stakeholder expectations
analysis.
As the economy and society have changed, so retailers have responded and shopping as an
activity has altered enormously (Dawson and Broadbridge, 1988). Though most of the previous
retail research studies have focused on store image and importance of store attributes in understanding
the concept of store choice and patronage behavior (Woodside and Trappey, 1992; Medina and
Ward, 1999; Outi, 2001; Ganguli, Shirshendu and Kumar, V (2008) have found out the important
parameters of customer loyalty and satisfaction for the Indian retail supermarket customer. Attempts
have been made to understand the impact of those parameters on loyalty and satisfaction of the
consumer.Aaker (1984) suggests four sub-areas: customer analysis, competitive analysis, industry
analysis and environmental analysis. Even though the main divisions are different the same elements
of analysis are contained in both frameworks: customer; competition; industry; and environment.
75

• To analyze whether strategy precedes structure or structure precedes strategy in purchase
decision of semi urban consumers to visit the food retail stores in Andhra Pradesh.
• To examine which factors of strategy and structure majorly influence purchase decision of
semi urban areas consumers in Andhra Pradesh.
4. Hypothesis
• H1: Neither strategy nor structure is important for consumer in making purchase decision at
food retail stores in Andhra Pradesh
• H2: There are no factors of strategy or structure which majorly influence purchase decision
of semi urban areas consumers in Andhra Pradesh.
5. Methodology
This study is exploratory in nature the questionnaire mall intercept interviews were conducted
to gather data. The survey was undertaken in Andhra Pradesh of India in semi urban areas. All
constructs were measured using 5 point Likert-type scales anchored from ‘1’= strongly disagree to
‘5’= strongly agree
Population: A population of all semi urban areas in Andhra Pradesh have been taken where
retail store are organized. Retail outlets considered for study are reliance oulet, more , spencer’s.
Sample - 400 respondents have been taken out of which 383 have been responded.
Technique: Factor analysis is implemented to investigate consumer shopping behaviour

dimensions whereas to measure the significance of demographic variables on shopping behaviour
dimensions, one-way ANOVA was adopted.
6. Limitations
• The study is limited to some of semi urban areas in Andhra Pradesh
• The study is limited to only 3 retail outlets as most of semi urban areas in Andhra Pradesh
have More, Reliance, Spencer.
• Only some of the strategy and structure factors are been considered as study demanded.
76
7. Demographic variables
Variables Divisions Frequency
Total no of respondents Local 238
From villages 113
Occasional visitors 32
Gender Male 246
Female 137
Age(in yrs) Below 25 76
25-35 98
36-50 173
above 36
Education Upto 12th 43
Graduation 210
Post graduation 130
Occupation/schooling Business 98
Govt Employee 143
Housewife 86
Professional(private) 24
School student 32
Monthly income Less than10000 86
excluding children 10000-30000 159
30000-60000 43
For identifying the impact of change different types of respondents have taken. About 62%
of respondents belonged to local category.
About 30% respondents from surrounding villages and .08% respondents are occasional
visitors who will be visiting the semi urban areas in Andhra Pradesh.
All the 19 parameters were taken into consideration to analyse the purchase decision of
consumers residing in semi urban areas. Factor analysis technique was implemented. Basing on
strategy and structure the total parameters are finally drafted into six factors. The factors are as
follows:
Strategy Structure
> Offers % Discounts > Value of purchasing
> Marketing mix > Store appearance
> Food Safety > Utility & Variety
77
8. Findings of the study

• Consumers in semi urban area are visiting the retails stores with perception of store
appearance, quality, offers, ambience, more than anything they are satisfied with the interest
of retailers to show the value of money for the consumers. In this context strategy and
structure both plays vital role in attracting consumers interdependently.
• The food consumption habits of consumers have been changed and increased with the existing
of variety of foods available in and out of the retail stores where all the age groups are being
attracted towards it.
• With the effective strategy and structure implementation and analysis of retailers from the
analysis it also understood that the monthly visiting of the consumers( all the age groups) to
retail stores is also increased when compared to before the existing of retail stores in semi
urban areas as availability of variety of food items can be purchased.
Analysis
Objective: 1 Factors of strategy and structure influencing consumers purchase decision.
Table 1 :
Factors Analysis
Value of purchasing
I feel that store brands are reasonably priced. 0.669
I look for the benefit of the product for the price I pay. 0.784
Marketing Mix -
I have choice of selection of products 0.536
Price is reasonable I feel 0.519
I like the promotion of retail stores 0.821
Is near to me and convenient to me 0.737
Discounts & Offers
In retail stores I get good discounts where I cant get in local kirana stores 0.740
Seasonal offers will be present 0.733
1+1 offers occasionally 0.821
Store appearance
The store’s advertisement encourages me to visit the store. 0.766
I enjoy shopping at a store. 0.765
I like self-selection while shopping. 0.571
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Barlett’s test of sphericity = 0.00; Kaiser-Meyer-Olkin KMO (0.804)

According to Bartlett the values should range from 0 to 1 . From the above analysis all the
values are Positive.
Kaiser-Mayer- olkin the values which are near to 1 are the best positive responses. From the
analysis factors like utility & variety, Discounts and offers, marketing mix, value of purchasing are
near to value 1.
Table 2 : One-way Anova Table
Factor Gender Age Education Occupation Income

Value of purchasing 47.32 .000 .768 .506 .662 .517 5.075 .004 .454 .713
Marketing Mix .059 .808 2.679 .103 1.847 .159 1.171 .321 2.35 .072
Discounts & Offers 9.738 .002* 1.607 .188 2.356 .072 1.613 .186 1.202 .274
Utility & Variety 83.557 .000 2.198 .088 .117 .889 4.958 .002* 4.365 .005*
Food Safety .047 .829 1.904 .129 .781 .459 2.272 .080 .304 .582
Store appearance .069 .808 .303 .823 3.158 .044 4.294 .005 25.309 .000
Factor one: value of purchasing behavioural dimension consumers tend to purchase as they
are very much attracted to retail store where the value of money is being identified and they can
also go for Other brand if their prefer which they can’t get in general kirana stores. From Table 3
value of money has high mean of 4.98. Table 2 explains that value of purchasing behaviour differs
significantly across gender (p = 0.000), occupation (p = 0.004) and monthly income (p = 0.713) of
the respondents.
Factor two: marketing mix describes the behavioural dimension of consumers related price,
product, promotion ,place as they does shopping to attain all the four at one stop .color,flavour,taste
etc., store brands and varieties available for Comparison of different brands (Table 3). The one-
way ANOVA table indicates that respondents of different income (p = 0.072), age (p = 0.103)
differ significantly on utility and variety seeking aspect from (Table 2).
Factor three: Discounts & offers explain that customers are willing to visit their preferred
store rather than nearby store, and buy all food and grocery items from such stores. They visit store
for their preferred store brands discounts & offers at different seasons, occasions, plus offers and
also due to the facility of making payment other than cash (Table 3). Table 2 concludes Discounts
& offers varies significantly on gender (P = 0.002), Education (p = 0.072) of the respondents but
not on remaining demographic variables.
Fourth factor: Utility & Variety considers that consumers enjoy variety of products, self
selection, and variety of brands while shopping and also induce them to visit stores (Table 3). Male
79
and female respondents vary significantly (p = 0.000) , occupations (p = 0.002),monthly income (p

=.005) but not by other demographic variables (Table 2).
Fifth factor: deals with the Food Safety of the customers who perceive high quality, cleaniness,
freshness, store maintenance are the status symbol of purchasing the products (Table 3). Occupation
vary significantly (p = 0.080) for hygienic consideration behaviour but not on the basis of the other
demographic variables (Table 2).
Factor sixth: store appearance behavioural dimension explains that customers are willing
to visit their preferred store rather than nearby store, and buy all food and Grocery items from such
stores. They visit store for their preferred store brands and also due to the facility of making
payment other than cash (Table 3). Table 2concludes that store loyalty dimension varies significantly
on education (P= 0.044), income (p = 0.000) and occupation (p = 0.005).
Interpretation : From the above analysis both strategy and structure of retail store plays a
vital role in purchase decision of the consumer in semi urban areas so the null hypothesis should be
rejected and alternate hypothesis should be accepted.
H1: Reject
H01: Accept
Objective :2
Variables present in factors of strategy and structure influencing semi urban consumer to
visit organised food retail store.
Table 3 :
Fruit & Food grains, Milk& Processed
vegetables oils, pulses Milk products food
Cleanliness 4.56 5 4.48 5 4.48 5 4.55 5
Nearby availability 3.39 4 4.42 5 4.12 5 4.00 5
Colour 3.91 4 3.31 4 2.54 3 4.20 5
Freshness 4.69 5 4.46 5 4.47 5 4.00 5
Free from pesticides 4.34 5 4.47 5 4.32 5 4.29 5
Flavour 3.63 4 3.94 4 3.89 4 3.76 4
Promotional Offers &
4.41 5 4.50 5 3.52 4 4.11 5
Discounts
Quality 4.34 5 4.35 5 3.81 4 4.75 5
Good ambience 4.22 4 3.99 4 3.00 3 3.19 4
80
Fruit & Food grains, Milk& Processed

vegetables oils, pulses Milk products food
Value for Money 4.98 5 4.44 5 4.65 5 4.32 5
Clean place of Sale 4.12 4 4.47 5 3.81 4 3.66 4
Good for health 4.41 4 4.50 5 3.52 4 4.11 5
Taste 3.48 4
Seasonality 4.47 5 2.58 2 3.23 3 3.19 3
Good display of Products 4.22. 5 3.46 4 3.00 3 3.57 4
Advertising 3.73 4 3.94 4 3.84 4 3.76 4
Locally produced 3.02 3 3.31 3 2.75 3 3.00 3
International branded 3.95 3 3.49 4.00 4 4.00 4
Shape 3.69 4 3.96 4 3.76 4 3.76 4
Note: 1 indicates “strongly disagree” and 5 indicates as “strongly agree”

Interpretation: mostly from the above analysis all the variables of strategy and structure
are influencing the semi urban consumer to visit the retail store in semi urban areas and purchase
food and grocery. So all the factors are influencing the consumer to visit retail store so the null
hypothesis should be rejected and alternate hypothesis should be accepted.
H2:Reject
H02:Accept
9. Conclusion
Both Strategy in attracting the consumers with offers ,discounts, giving value to money and
structure in designing the appearance of store, arranging of items, varieties, freshness, too many
brands made semi urban consumer to be their members and family. Consumer visiting retail store
is a status and quality conscious. both the strategy of attracting the consumers and structure In
appearance, maintaining the store plays a vital role in making semi urban consumer to come, purchase,
know different brands, variety, freshness of the products.availability,freshness,quality, color,flavour,
Cleanliness of the product, free from pesticides, freshness, good for health, and clean place of sale
important attributes very highly rated attributes are value of money ,and discounts and offers, taste,
good ambience, availability of variety of products are most important attributes which influenced
the consumers.
81
In this context even the other retail stores are showing interest in launching their stores so as
to attract the consumers in semi urban areas. From the analysis during the last 5 years majorly 3
retail stores have spread their outlets in different semi urban areas and still planning to organise in
other places.
References
1. Sahani, P.B. (2007). “Consumer Buying Behaviour and Food Retailing,” Marketing
Mastermind, (December), 21-5.
2. Hamlett, Jane et. al. (2008). “Ethnicity and Consumption: South Asian Food Shopping Pattern
in Britain, 1947-75”, Journal of Consumer Culture, Vol 8(1), 91-116.
3. Jarratt,D.(1996), “A shopper taxonomy for retail strategy development”, International Review
of Retail, Distribution and Consumer Research , Vol 6,No.2 , pp.196-215.
4. Fahey, L. and Narayanan, V. (1986), Macroenvironmental Analysis for Strategic Management,
West Publishing, St Paul, MN.
5. JOHN F. TOMER” Strategy and Structure in the Human Firm: Beyond Hierarchy, Toward
Flexibility and Integration, the Journal of Socio-Economics, Vol. 24/No. 3/l 995.
6. Ganguli, Shirshendu and Kumar, Vinoth (2008), “Drivers of Customer Satisfaction and Loyalty
in Indian Retail Supermarkets: An Exploratory Study” The Icfaian Journal of Management
research, Vol. 7, No. 12, pp. 60-73, December 2008.
82
Quality of Work Life in State Bank of India, Hyderabad

- Mr. K. Veeraiah*
- Dr. G. Manchala**
Abstract
Purpose of the research paper is to gain an insight into current quality of work life
policies and practices of Employees in SBI Bank Ltd, Hyderabad in Andhra Pradesh. Several
dimensions that influence Quality of work Life are Working Conditions, Use of Capacities
at the work, Opportunity and Growth , Social Integration, Constitutionalism (respect to the
laws) , Work life balance, Social relevance and importance of work, Fair and appropriate
Salary (Compensation) etc. QWL provides for the balanced relationship among work, non-
work and family aspects of life. This paper is based on the information given by the Bank's
Employees and through questionnaire filled by them.
Key words: Quality of Work Life, State bank of India, Dimensions (Parameters).
1. Introduction
Quality of Work Life (QWL) has become one of the most important issues these days in
very organisation. Employees are the force that is behind every successful organisation. No
organisation can become successful with technology only because for the use of technology also,
organisations need to have strong work force.
Quality of Work Life was the term actually introduced in the late 1960’s. From that period till
now the term is gaining more and more importance everywhere, at every work place. Initially
quality of work life was focusing on the effects of employment on the general well being and the
health of the workers. But now its focus has been changed. Every organisation need to give good
environment to their workers including all financial and non financial incentives so that they can
retain their employees for the longer period and for the achievement of the organisation goals.
The factors that influence and decide the Quality of work life are: 1. Working conditions 2.
Use of capacities at the work 3. Opportunities and growth 4. Social integration 5. Constitutionalism
(Respect to the laws) 6. Work life balance 7. Social relevance and importance of work 8. Fair and
appropriate salary (Compensation).
At the end we can say that a happy and healthy employee will give better turnover, make
good decisions and positively contribute to the organizational goal.
* Assoc.Prof, CMRIT, Hyderabad, Research Scholar Dept of HRM, Acharya Nagarjuna University, Guntur.
** Professor, VJIM, Hyderabad, Research Scholar Dept of HRM, Acharya Nagarjuna University, Guntur.
83
2. Literature Review
Hackman and Oldham (1976) [8] drew attention to what they described as psychological
growth needs as relevant to the consideration of Quality of working life. Several such needs were
identified; Skill variety, Task Identity, Task significance, Autonomy and Feedback. They suggested
that such needs have to be addressed if employees are to experience high quality of working life.
Mirvis and Lawler (1984) [13] suggested that Quality of working life was associated with satisfaction
with wages, hours and working conditions, describing the “basic elements of a good quality of work
life” as; safe work environment, equitable wages, equal employment opportunities and opportunities
for advancement. Baba and Jamal (1991) [1] listed what they described as typical indicators of
quality of working life, including: job satisfaction, job involvement, work role ambiguity, work role
conflict, work role overload, job stress, organizational commitment and turn-over intentions. Baba
and Jamal also explored routinisation of job content, suggesting that this facet should be investigated
as part of the concept of quality of working life. Sirgy et al.; (2001) [18] suggested that the key
factors in quality of working life are: Need satisfaction based on job requirements, Need satisfaction
based on Work environment, Need satisfaction based on Supervisory behaviour, Need satisfaction
based on Ancillary programmes, Organizational commitment.
The evolution of QWL began in late 1960s emphasizing the human dimensions of work by
focusing on the quality of the relationship between the worker and the working environment. QWL
as a discipline began in the U.S. in September 1972 when the phrase was coined at a “democratization
of work” conference held at Columbia University’s Arden House to discuss two movements. The
first was a political movement in Western Europe called ‘Industrial Democracy’. Militant, socialist
labor unions were lobbying the parliaments and assemblies of England, France, West Germany,
Sweden and Italy to legislate worker participation in corporate decision-making. The second
movement was the emergence in the U.S. of a number of social science theories about “humanizing
the workplace” [3]. This shows that the model that evolved during the early years called for formalizing
labor-management cooperation at the workplace by establishing joint committees at various levels
to define, diagnose and devise solutions to day-to-day work problems. For instance, participation
programs emerged from contract bargaining between General Motors Corporation and United
Auto Workers Union was called Quality of Work Life in 1973 which was aimed at increasing
workers’ satisfaction with their jobs by giving them more information and a voice in decision-
making [19]. Indeed, it is difficult to best conceptualize the quality of work life elements [17]. Walton
[21]
proposed eight major conceptual categories relating to QWL as 1. adequate and fair compensation,
2. safe and healthy working conditions, 3. immediate opportunity to use and develop human capacities,
4. opportunity for continued growth and security, 5. social integration in the work organization, 6.
constitutionalism in the work organization, 7. work and total life space and 8. social relevance of
work life. Several published works have addressed the constructs that make up the QWL domain
84
and key elements of QWL programs [1-5, 12]. Others such as Pelsma et al. [15] and Hart [9] found that
psychological distress and morale contributed equally to teachers’ QWL. They determined that in
the work climate of an occupation, QWL can be assessed by combining the amount and the degree
of stress and the degree of satisfaction experienced by the individual within his/her occupational
role. Winter et al. [22] viewed QWL for academicians as an attitudinal response to the prevailing
work environment and posited five work environment domains that include role stress, job
characteristics, supervisory, structural and sectoral characteristics to directly and indirectly shape
academicians’ experiences, attitudes and behavior. According to Loscocco and Roschelle [12], the
most common assessment of QWL is the individual attitudes. This is because individual work
attitudes are important indicators of QWL. The ways that people respond to their jobs have
consequences for their personal happiness, the effectiveness of their work organizations and even
the stability of society. Individuals selectively perceive and make attributions about their jobs in
accordance with the expectations they bring to the workplace. While the characteristics of the jobs
have long been considered to be important influences on work attitudes, the past decades of 1970s
and 1980s have witnessed much greater attention to aspects of the organizational context in which
the job is performed. Thus, we must also look at how organizational characteristics exert both
direct and indirect effect on the QWL. Age may be the most commonly studied individual influence
on work attitudes. Studies which use widely differing samples find consistent results: older employees
are more satisfied, more job-involved and more committed to their work. Studies of the relation
between career stage and job satisfaction and job involvement yield inconsistent findings. For
example, there is a positive relation between career stage and work commitment when career
stage is defined in terms of age, but curvilinear relations appear when age is defined in terms of job
or company tenure [12]. Past studies indicate that family roles reflect needs, opportunities and
constraints have influence on individuals' reactions to work. After all, two important focal points of
adult life are family and work. The role expectations of these two domains are not always compatible
thus creating conflicts [14]. These conflicts are related to outcomes such as job dissatisfaction, job
burnout and turnover [2-27], as well as to outcomes related to psychological distress e.g. expression
and life and marital dissatisfaction [11-16]. Work-family conflict studies have contributed to a better
understanding of role conflict and its impact on mental health and the quality of work life [10].
3. Overview of SBI bank

SBI bank is India’s largest bank with total assets of ` 355 billion and 314 million equity
shares. The bank has a network of 9400 branches and associated banks branches are 4500 and
5600 ATMs in India and presence in 32 countries. SBI Bank offers a wide range of banking
products and financial services to corporate and retail customers through a variety of delivery
channels and through its specialised subsidiaries and affiliates in the areas of investment banking,
life and non-life insurance, venture capital and asset management.
85
4. Objective of Study
1. To assess the quality of work of life of State bank of India employees.
2. To know which dimension is more dominant among all dimensions of quality of work life in
State bank of India.
3. To compare which employees designation is leading more Quality of Work Life in the state
bank of India.
5. Research Hypotheses
H01: There is no significance difference of Quality of Work Life in State Bank of India
employees.
H02: There is no significance difference all dimensions are dominated in the quality of work
life in State bank of India bank employees.
H03: There is no significance difference between all employees Designations are leads Quality
of Work Life.
6. Research Design and Methodology

This research paper is findings resulting from the field data collection and analysis as defined.
The research paper was designed to answer the research question: Who will lead more Quality of
Work Life of SBI Bank employees in Hyderabad. This chapter reviews the data collection process
and response rates, and presents analysis.
POPULATION
The bank is agreed to participate in the study, allowing the representation of their company
and participant's total of 325 of questionnaires were prepared and distributed for the study. Out of
325 questionnaires, 65 distributed to each designation viz., Manager, Deputy Manager, Assistant
Manager, Senior Assistant, and Assistant for the bank. 300 questionnaire were fully completed and
returned (92%) by the bank employees. The bank employees in Hyderabad produced high percentage
of completed questionnaires.
The number of completed questionnaires represented high response rate. This response rate
implies that data from the sample of participants can be considered representative of the larger
group. The high response rate is consistent with my expectations when the sample group was
selected.
DATA COLLECTION PROCESS
The questionnaires were distributed to various levels of employees (Designations of employees
were mentioned in population) in SBI Bank in Hyderabad. Each employee has completed
86
questionnaires which were then returned by the researcher. Each respondent's questionnaire was
reviewed and the following criteria were used to exclude a response from the study or to add value
for missing data.
1. If an individual response gave the exact/same response for all questions of questionnaire,
that sample was excluded. The study viewed this as unresponsive and the resulting effect
could skew the overall sample data.
2. A non- response for an individual question was interpreted as a subject who believed that the
statement did not apply to him or her.
3. Three or more non-responses on any individual sample resulted in that sample being excluded
from the study.
MEASURES
a. Quality of Work Life of employees
Quality of work life questionnaire is developed by the researcher based on Richard E. Walton
Dimensions of quality of work life. The QWL questionnaire consists of 31 statements on five point
scale ranking from Strongly Agree to Strongly Disagree. Here 5 being strongly Agree and 1 being
strongly Disagree.
7. Data Analysis and Interpretation

Weighted Average scores were used to determine significance of the averages of the bank
and the testing hypotheses. The study began with descriptive exploration of the data that was
collected.
Hypothesis1-3:
H01: There is no significance difference of Quality of Work Life in State Bank of India
employees.
DIMENSIONS SBI BANK OF INDIA
Working conditions 4.6
Use of Capacities at work 3.6
Opportunities and Growth 4.4
Social Integration at work 4.3
Constitutionalism at work 4.8
Work life Balance 4.8
Social relevance and importance of work 4.4
Fair and Appropriate Compensation 4.7
QWL(Weighted averages mean score) 4.4
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Interpretation
From the above analysis, it is observed that the State banks of India employees are leading
the Quality of Work life is (4.4). Hence H01 is accepted.
H02: There is no significance difference all dimensions are dominated in the quality of work
life in State bank of India bank employees.
DIMENSIONS SBI BANK OF INDIA
Working conditions 4.6
Use of Capacities at work 3.6
Opportunities and Growth 4.4
Social Integration at work 4.3
Constitutionalism at work 4.8
Work life Balance 4.8
Social relevance and importance of work 4.4
Fair and Appropriate Compensation 4.7
Interpretation
From the above analysis, it is observed that the State bank of India employees are leading
dimension of the Constitutionalism and Work life balance are (4.8) comparison of the other dimensions.
Hence H02 is rejected.
H03: There is no significance difference between all employees Designations are leads Quality
of Work Life.
Total
Assistant Deputy
DIMENSIONS Assistant Sr. Assistant Manager Weighted
Manager Manager
averages
1. Working conditions 4.6 4.7 4.6 4.7 4.6 4.6
2. Use of Capacities at
3.0 3.0 3.0 4.3 4.7 3.6
work
3. Opportunities and
3.0 4.8 4.7 4.7 4.9 4.4
Growth
4. Social Integration at
4.4 3.0 4.9 4.3 4.9 4.3
work
5. Constitutionalism at
4.8 4.8 4.9 4.6 4.9 4.8
work
6. Work life Balance 4.8 4.8 4.9 4.6 4.9 4.8
7. Social relevance and
4.5 4.4 4.2 4.3 4.7 4.4
importance of work
8. Fair and Appropriate
4.9 4.8 4.6 4.5 4.7 4.7
salary (Compensation)
Total Weighted
4.2 4.2 4.4 4.5 4.7 4.4
Average
88
Quality of Work Life of SBI Employees
2.5
1.5
0.5
)
th
rk
k
rk
rk
ion
e
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ns
or
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ow
wo
wo
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ns
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ir
7.
Fa
8.
Assistant Sr. Assistant Assistant Manager Deputy Manager Manager Total W eighted averages
Interpretation
From the above analysis the over all Designations of the employees are dominated all
dimensions of the Quality of work life is compare to all designations of Assistants (4.2),
Sr.Assistants(4.2), Assistant Managers (4.4), Deputy Managers (4.5), Managers (4.7) Over all the
dominated designation of all dimension slightly, Managers (4.7) in the SBI bank. Hence H03 is
rejected.
FINDINGS
The researcher has taken during the interaction office employees working in the Branches
of SBI with the employees in Hyderabad Region. Organized throws interviews the researcher
came to know about lot of information the Bank for the employees. On the basis of the regarding
the bank’s policies and employee’s questionnaire the researcher know that 4.4% of the overall
employee’s are satisfied with the quality of work life in the organization and over all designations
89
dominated all 8 dimensions of the bank first place opted by Managers (4.7), second place Deputy
Managers (4.5), Third place Assistants Managers (4.4), Sr.Assistant (4.2) Assistants (4.2).
8. Conclusion
On the basis of the research paper over all Quality of work life of the SBI employees are
good (4.4), the leading dimension among the all dimensions of Quality of work life is Constitutionalism
and Work life balance are (4.8) comparison between the other dimensions. But compare to all
designations of employees of Assistants (4.2), Sr.Assistants (4.2), Assistant Managers (4.4), Deputy
Managers (4.5), Managers (4.7) over all the dominated designation of all dimension slightly, Managers
(4.7) of the employees in the SBI bank. Social responsibilities and hence they are satisfied with
their jobs.
References
1. Baba, VV and Jamal, M (1991) Routinisation of job context and job content as related to
employees quality of working life: a study of psychiatric nurses. Journal of organisational
behaviour. 12. 379-386.
2. Burke, R.J., 1988. Some antecedents and consequences of work-family conflict. J. Social
Behavior and Personality, 3: 287-302.
3. Davenport, J., 1983. Whatever happened to QWL? Office Administration and Automation,
44: 26-28.
4. Feuer, D., 1989. Quality of work life: a cure for all ills? Training: The Magazine of Human
Resources Development, 26: 65-66.
5. Frone, M.R., M. Russell and M.L. Cooper, 1992.Antecedents and outcomes of work-family
conflict: Testing a model of the work-family interface. J.Appl. Psychol., 77: 65-78.
6. Greenhaus, J.H. and N.J. Beutell, 1985. Sources of conflict between work and family roles.
Acad. Manag. Rev., 10: 76-88.
7. Gutek, B.A., S. Searle and L. Klepa, 1991.Rational versus gender role expectations for
workfamily conflict. J. Appl. Psychol., 76: 560-568.
8. Hackman J &Oldham G (1974) The Job Diagnostic Survey. New Haven: Yale University
9. Hart, P.M., 1994. Teacher quality of work life:integrating work experiences, psychological
distress and morale. J. Occupat. Organ. Psychol.,67: 109-132.
10. Higgins, C., L. Duxbury and R.H. Irving, 1992.Work-family conflict in the dual-career family.
Organizational Behavior and Human Decision Processes, 51: 51-75.
90
11. Lewis, S. and C.L. Cooper, 1999. The work-family research agenda in changing contexts.
J. Occupat. Health Psychol., 4: 382-393.
12. Loscocco, K.A. and A.R. Roschelle, 1991.Influences on the quality of work and non-work
life: two decades in review. J. Vocational Behavior, 39: 182-225.
13. Mirvis, P.H. and Lawler, E.E. (1984) Accounting for the Quality of Work Life. Journal of
Occupational Behaviour, 197-212.
14. Netemeyer, R.G., J.S. Boles and R. McMurrian,1996. Development and validation of work-
family conflict and family-work conflict scales. J. Appl.Psychol., 81: 400-410.
15. Pelsma, D.M., G.V. Richard, R.G. Harrington and J.M. Burry, 1989. The quality of teacher
work life survey: a measure of teacher stress and job satisfaction. Measurement and Evaluation
in Counseling and Development, 21: 165-176.
16. Pleck, J.H., L.S. Graham and L. Linda, 1980.Conflicts between work and family life. Monthly
Labor Review, 103: 29-33.
17. Seashore, S.E., 1975. Defining and measuring the quality of working life. In L.E. Davis and
A.B.
18. Sirgy, M. J., Efraty,, D., Siegel, P & Lee, D. (2001). A new measure of quality of work life
(QoWL) based on need satisfaction and Spillover theories. Social Indicators Research, 55,241-
302.
19. Smith, D.C., 1983. QWL, EI needed now more than ever. Ward's Auto World, 19, 12.
20. Voydanoff, P., 1988. Work role characteristics, family structure demands and work/family
conflict. J. Marriage and the Family, 50: 749-761.
21. Walton, R.E., 1975. Criteria for Quality of Working Life. In L.E. Davis, A.B. Cherns and
Associates (Eds.) The Quality of Working. New York: The Free Press, Life, 1: 91-104
22. Winter, R., T. Taylor and J. Sarros, 2000. Trouble at mill: quality of academic work life issues
within a comprehensive Australian university. Studies in Higher Education, 25: 279-294.
Web sites
1. www.rbi.com
2. www.banknetindia.com/banking/boverview.htm
3. www.google.com
4. www.sbi.com
91
Radio Taxi Services in Jaipur:

A Learning Experience from Meri Car
– Dr. Makarand Upadhyaya*
Abstract
Meri Car is the leader, having developed the concept of Meri Car in the city of Jaipur.
Currently, they are enjoying majority market share in the Meri Car business in Jaipur.
Since the time of inception, there has been a steady growth in sales which has been a lot
due to the shift in the consumer preference for the Meri Cars as compared to the unorganized
players which include privately owned cabs as well as the three wheelers. Yet, the steady
increase in gross profits has been much lesser than the growth in sales. In other words,
margins are shrinking due to increase in input cost. The two new entrants in the market
have come earlier than expected; backed by ample resources giving rise to stiff competition.
There is an urgency to review their strategy to ensure long term profitability and sustainability.
1. Introduction
Unorganized economy contributes significantly to the overall Indian economy. With
advancements in technology, presence of multinationals, changing psychographic profiles and many
such drivers of the economy, the share of the organized sector in various industry segments is
slowly but steadily increasing. Learning from developed economies are being translated to feasible
business models in the Indian circumstances. One such idea was brought back home by Manish
Kumawat from his experiences at Dubai. Some of the world’s best Meri Car services are in
Singapore, Dubai and Malaysia. He thought of starting the Meri Car service in his home city of
Jaipur which is the capital of the state of Rajasthan. This was the beginning of the conceptualization
of “Meri Car” with Manish Media Agency agreeing to promote the plan and Neelkanth Cabs Pvt.
Ltd. took birth.
The brand name ‘Meri Car’ was decided as it communicated a personalized feeling amongst
all target segments. Today, Meri Car is one of the main Meri Car cabs in Jaipur with more than
50% share of the Meri Car market. They initiated their operations on 22nd of August 2009 with the
launch at Amar Jawan Jyoti, Jaipur. First car was flagged off by Ms Kiran Bedi – first lady IPS
officer; a well known personality and Mr. P K Tiwari – retired Director General of Police, Rajasthan.
There were print advertisements in the selected newspapers, press release in all Jaipur editions of
national dailies and other regional dailies.
* Associate Professor in Marketing at College of Business Administration, Jazan University, Jazan, Saudi Arabia.
Email.makarandjaipur@rediffmail.com
92
At the time of the launch, there were three branded players with varying fleet sizes but all
were preparing to exit. There were a number of entry barriers which ranged from developing
conduciveness of the prospects and collaborators to legal clearances. These were overcome or
lowered by mediation and promotions. Meri Car sales have steadily increased since the time of
launch till date. Today ‘Meri Car’ is approved by Department of Tourism, Government of Rajasthan.
Meri Car provides 24×7 services. They have a dedicated fleet of 60 Maruti 800 AC cars
with company fitted LPG for city operations only. They have other vehicles which includes Indica,
Indigo, etc making the total fleet size of approximately 120 cars. They have the hunting number 91
– 141 - 4188 888 and can receive upto twenty parallel calls.
Prior to Meri Car, there were 3 semi organized operators namely Pink City Meri Cars, Jyoti
Meri Car and Swiss Cabs. They all had different fleet sizes and target segments. Apparently, Meri
Car business was becoming unviable for all these players. The reasons are not clearly known.
Surprisingly, all of the existing players exited the Meri Car business on the arrival of Meri Car.
Revenue Generation at Meri Car is done not only through the rent charged to customers for
the travel but also through the sale of media space which is the external surface of all Meri Cars.
Almost 50% of the revenue comes from such advertisements. Some of their prominent advertisers
are JK Tyres, Aircel, Bank of Baroda, Unique Builders, Biyani group, Honda, NIIT, Nerolac and
many more. What is credible is that this advertising is done without compromising the prominent
display of Meri Car's own logo and hunting number on all sides of the car which affords them to
have a shoestring budget for their own promotions, though they have occasional print advertisements.
Also, approximately 30% of the travel rent income comes from the institutional sales catering
to the needs of their branches/offices in Jaipur. Some of their clientele is MTS, Tata
Telecommunications and some hotels. They have a share of captive customers as their sister
concerns subscribe only the services of Meri Carand one of the sister concerns is a prominent
player for tourism in Jaipur – Neelkanth Holidays. Captive customers also come through their
government tie up for “Janani Suraksha Yojana” (Protecting the mother of the new born) which
provides a free trip to the mother along with an attendant back home from the hospital. Meri Cars
are employed for this facilitation.
2. Meri Car Vehicles

Meri Cars running within the city have a color coding with a pink roof and white body; pink
denoting the pink city – Jaipur. This color coding is not mandatory for cab attachment contracts
(discussed later).
All their vehicles are equipped with Global Positioning System (GPS). With the help of this
they can track each vehicle with respect to location, and speed of each vehicle. All vehicles are
fitted with Message Display Terminals (MDT) as well. Whenever there is a requirement/booking
the copy of the detailed message is sent from the call center to the respective cab along with the
customer.
93
3. Pricing
At the time of launch, Meri Car started with the tariff of ` 25/- up to 2 kms and ` 10/- per
Km subsequently. They have had one rate revision in July 2012 mainly in response to the rising fuel
prices. Now it is rs. 15 per Km and minimum charges is ` 50 upto 3 kms distance. The meter in the
car starts clocking the distance only after engagement that is when the customer sits in the car but
always car would have already travelled some distance to arrive at the pickup point. The fuel cost
for this uncharged distance needs to be appropriated over the charged distance. In cases where the
fuel cost is to be borne by the driver, this had always been an issue. This problem was overcome
partially by the bidding system whereby the call center, on receiving a requirement intimates all non
engaged Meri Cars within a 5 Km radius. The drivers take their call to take or ignore the bid. The
bidding system is real time, transparent and automated. This has helped resolve many issues with
the Meri Car operators.
Meri Cars wait up to ten minutes after arriving at the waiting time at the pick - up point;
beyond which a charge of ` 1.10 is levied per minute. They give a printed bill at the time of drop.
For current charges refer EXHIBIT 1. There are some areas on the city outskirts for which meter
rates are not applicable and some extra amounts are charged. The details of these charges are
given to the customers at the time of booking and a manual bill is given by the car operator on
demand of the customer.
4. Operations
The operations of Meri Car have a very heavy reliance on drivers and call centre executives.
This is a segment which is largely the face of the company. Most of the clientele is educated males
and females. Normally the education level of customers, in most of the cases, is higher than these
dealing hands. Many females prefer Meri Car in comparison of three wheeler due to safety and
security.
Initial investment in the business was approx 3 crores which was required for owing fleet,
investment in technology, hiring manpower, training transparency and detailing, real time
communication and documentation which are the backbone of their business model. This investment
in information technology also helps minimize the cost of operations in the long run. Meri Car has
their own call center which receives the bookings, dispatch them to the cars through the bidding
system and confirm the bids.
Meri Cars are operates through three types of contracts with individuals having a commercial
driving license.
5. Nature of contracts
They man and source their cars through different contracts.
94
1. “Chalak Se Malik” - CSM (meaning driver to owner): in this form of the business, drivers
pay the company for a period of three years and the component average ranges from ` 450
to 600 per day. The fees applicable are a function of the average engagement level of the
individual. The applicable rate are for all 365 days of the year irrespective of its usage.
In full tenure, the cost of maintenance, repairs is borne by the drivers. Some formalities and
expenses are borne by the company and which includes Insurance of the car, RTO fitness
fees, road tax and permit fees.
After three years, ownership will be transferred to the driver and the driver may choose to
change the nature of the contract. Meri Car has a tie up with the service center where all
their cars are serviced at nominal rates and even the spare parts are sourced through a
known supplier at fair prices.
2. Cab Attachment: In this category, the color coding of the car is not a compulsion. Though,
the RTO requirements and government regulations would be followed. One of The
requirements of this contract with Meri Car is a security deposit (SD) of ` 15,000/-. Refundable
at the end of the expiry of the contract (renewable) which is of duration of eleven months.
All these vehicles are also fitted with GPS, MDT and meter printer as in other cars. The cost
of this equipment is approximately ` 50,000/- and the SD is mainly meant to cover the partial
cost of the same.
In this module, Meri Car commits minimum ` 30,000/- monthly business to the owners of the
car. Meri Car will charge ` 3000/- to ` 15,000/- proportional to the business generated from
the attached vehicle owner.
3. Salary Module: In this module, Meri Car has drivers on a salary ranging from ` 5,500/- to
` 12,000/- per month. They also get incentive on the basis of targeted business generation.
The duty hours are minimum twelve hours a day and availability of the driver over and above
twelve hours is entitled to overtime on an hourly basis. This overtime is directly proportional
to the salary.
Their work timings are maintained through automated process as each driver has its
unique login ID and password and the attendance is marked through the MDT in their respective
cars.
There are three monthly awards
• Neat and cleanliness award
• Best cab average award
• Best services award
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The first award is for the neatness and cleanliness of the car and the present ability and
demeanor of the driver. The second award is for the engagement of the car and the third award is
for the behavior and customer complaints based on the standard feedback procedure of the company.
All the bookings of the cab are done through call centre which runs in three shifts of eight
hours each. Each shift comprises of six to eight people and two to three dispatchers. The salaries
of call centre staff range from ` 7,000/- to 9,000/- per month. At the same time the qualifications of
these people are secondary or senior secondary or in other words, twelve years of formal education.
The skill sets comprising communication in English and Hindi, basic knowledge of computers and
awareness of Jaipur city topography.
Meri Cars have five people in the administrative office, about thirty people in the call center
and all the car operators/drivers in 120 Meri cars under different contracts.
6. Customer complaint redressal systems

Meri Cars has a robust Customer complaint redressal system in place. The company receives
feedback in two ways. One is the voluntary feedback of customers which they give on the customer
complaint number 91 - 41 – 888 66 from 15 AM to 5 PM and email – suggestion@mericar.in. The
company also calls fifty customers every month and takes their feedback on a number of parameters
like the cross verification of pick – up and drop locations, demeanor of the drivers, timeliness,
billing, etc.
Nature of customer complaints

The incidence rate of complaints is 3%. Meri Car receives a battery of complaints from its
customers. Many people also log multiple complaints. Refer EXHIBIT 2.
Complaints are redressed individually wherever applicable. Also through performance based
payment and incentive system drivers are encouraged and motivated so that complaints could be
reduced as a process.
7. Competition
At the time of entry, Meri Cars had the onus of developing awareness and conduciveness in
the market for the Meri Car concept. The unorganized operators continue to be major competitors
as the rates charged are comparatively lesser by players like the three wheeler operators. Also, the
buying behavior is most of the times spontaneous with intracity travel time being unplanned. Meri
Car has been able to make headway because of the perception of safety by women subscribers
and luxury. With this groundwork, Meri Car inadvertently lowered the entry barriers for subsequent
entrants. Though the semi organised players exited the market almost instantly after the entry of
Meri Car, there has been entry of two major competitors operating with similar business models
giving rise to competition.
96
One of the critical elements in the business is the drivers. As such the availability of drivers
is highly seasonal and good reliable people are difficult to find and retain. Post the entry of Metro
Cab and My Car, the turnover has increased substantially. Under normal circumstances the turnover
is 10%. Though they have 50% of their initial staff till date, the threat of poaching by other players
cannot be denied as there are minimal exit barriers for the drivers. There are 3 types of driver
unions namely
Drivers Association of India
Drivers Association of Rajasthan
Drivers Association of Jaipur
And Approximately 30% of the drivers of Meri Car are members of either of these associations.
Meri Car had already received a contagion of a union in 2009 representing drivers and their complaints.
This was effectively resolved with the proof of transparency and objectivity in operations.
Subsequently, the compensation structure was revised.
8. Challenges
Meri Car entered the market with a lot of resistance from the unorganized operators. There
was a strike by auto rickshaws/three wheelers. There were attacks on Meri Cars and damages
were done to it. They were not allowed to enter railway station parking lots. This was overcome by
procuring the annual rate contracts of the parking lots which was very expensive.
The nature of hurdles have transformed over the period of time. The conversion of the
unorganized sector to organized sector continues to be slow as the prospects do not yet completely
agree with the benefits of the additional features of the offerings. While this challenge remains
unconquered, the market share which was initially 100% of the organized sector has now fallen to
50% with the advent of competitors; which to the surprise of the company has been relatively early.
Since it is a service industry, customer satisfaction is the critical area to attain and maintain
business. To provide the services on expected lines, role of the drivers become most important as
they are largely the face of the company. There is a lot of challenge of retaining good drivers and
their attrition rate is too high. Hiring of drivers is an ongoing process and Meri Car resorts to
multiple processes including referrals by existing drivers as the methods for hiring.
Till date Meri Car has benefitted from the cost benefit equation derived by introducing Maruti
800 AC costing approximately 2.70 lac and the vehicles have low maintenance cost. Now, with
official discontinuation of the model by Maruti, the company will need to identify models for further
addition to the fleet. Also, discontinuation of the existing cars will prove to be a Herculean task. At
the same time, the competitors are improvising fast. Meri Car is planning to take new fleet by
97
Dec’2012 which would require additional expenditure. Also the other operators who have
comparatively better brand of fleet would have an added advantage if they reduce the fare once
their cars gets little old. It will weaken the price advantage which Meri Car has right now.
The construction of Metro rail is progressing fast. The citizens of Jaipur city would soon
have the option of traveling by Metro train and the total market for cab operations would shrink.
Meri Car has a challenge in maintaining its success story in future.
Exhibit 1: Rate cards*
Charges per
S. No. Vehicle Minimum Charges
Km (in `)
City Limits
1 Maruti 800 AC ` 50/- upto 3 Km 15
2 Indica ` 50/- upto 3 Km 15
3 Indigo ` 50/- upto 3 Km 18
4 Innova ` 100/- upto 3 Km 18
5 Xylo ` 100/- upto 3 Km 19
City, outskirts and Intercity
1 Indica 250 Km at rate 6
2 Indigo 250 Km at rate 7
3 Innova 250 Km at rate 9
4 Xylo 250 Km at rate 9
Exhibit 2: Composition of customer complaints
Complaints Percentage (%)

Late arrival of the vehicle 45
Unbilled payment 05
Driver’s misbehavior 25
Longer route selection 10
others 15
Total 100
98
Exhibit 3: Profile of existing customers

Criteria Distribution N
Age 17-24 25-35 36-45 46- above
100
% 15 35 20 30
Gender Male Female
100
% 40 60
Geographical Walled city Central Jaipur Outer Jaipur
100
% 23 37 40
Exhibit 4: Competition
Fleet Size Model Date of
Competitor Date of entry
(No. of cars) specification exit
Metro car 50 Spark & Dec 2009 Operating
Indigo
My Cab 50 Indigo June 2012 Operating
Pink City 20 Yellow Prior to Meri Oct 2009
Black Maruti Car
Omni Van
Jyoti Cab 30 Indica AC Prior to Meri Sept 2009
Car
Swiss Cab 10 Indica AC Prior to Meri Jan 2012
Car
99
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Key dimensions of employee engagement: A study on Hyderabad organized

Article · October 2012

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Vol. 1, No. 4 October - December, 2012

1. Introspection of Women Entrepreneurs : A Garrette’s Approach

SUMEDHA JOURNAL OF MANAGEMENT

3. An Empirical Study on Occupational Stress among the Employees of Telecom Industry

4. Performance Management System in a Manufacturing Company

5. Service Sector’s Contribution to The State Economy : A Study of Nagaland

6. Key Dimensions of Employee Engagement : A Study on Hyderabad Organized Retailing

7. Impact of FDI on Retailing : A Multi Dimensional Approach

8. Strategy Preceeds Structure Vs Structure Preceeds Strategy for Purchase Decision of

9. Quality of Work Life in State Bank of India, Hyderabad

Indexed in ProQuest DataBase

Prof. T.L.N Swamy : Head Dept. of Economics, Osmania University.

Introspection of Women Entrepreneurs

2. Need for the Study

3. Conception of the Idea

4. Perception on their Entrepreneurial Ability

5. Perception of Business Risks

Conceive the Idea 1 2 3 4 5 6 7 8

Table 2A: Perception of Women Entrepreneurs on their entrepreneurial ability.

Perception on Garrett's Mean

Vol. 1, No.4 October - December, 2012

Table 3A: Perception of Women Entrepreneurs on business risks.

Perception on business risks 1 2 3 4 5 6 7 Total

Perception of business Garrett's Mean

Availability of low cost

Vol. 1, No.4 October - December, 2012

Impact of the Direct Tax Code on

2. Objective of the Study

* Guest Faculty, Department of Commerce, Harishchandra P.G. College, Varanasi.

3. History of Indian Tax System

4. Objective of Direct Tax Code

• Raising tax revenue in Gross Domestic Product (GDP) ratio,

• Reducing compliance cost.

• Reducing ambiguity in tax law,

• Reducing tax avoidance.

• Minimizing tax dispute.

• Preventing the erosion of tax base through tax evasion.

• Reducing the complexity in tax structure

• For clear understanding to tax payers..

• Rationalizing Tax system

• Single code for wealth tax

5. Analysis of Tax Liability of Individuals

Table 1.1: Comparative Analysis of Tax Structure

Particulars Tax rates Under Income tax DTC

Table 1.2: Impact of Tax of Different Income Group of Assesses

Particulars Income Tax DTC Saving

Particulars Income Tax DTC Saving

An Empirical Study on Occupational Stress among the

b. FI-FD had a positive and significant association with occupational stress.

3. Objectives of the Study

5. Results and Discussion

Table 1 : Demographic characteristics of the Sample

Gender Male 51 72.9

Education Diploma 19 27.1

Post graduate 23 32.9

Work Experience Freshers 13 18.6

(in years) 1-5 35 50.0

Income Below 10000 18 25.7

(in rupees) 10000-15000 30 42.9