SERVICE MARKETING

ARTICLE BY: DRISHYA SUBASH

Services marketing is marketing based on relationship and value. It may be used to market a service or a product.

Marketing a service-base business is different from marketing a goods-base business.

There are several major differences, including:

1. The buyer purchases are intangible
2. The service may be based on the reputation of a single person
3. It's more difficult to compare the quality of similar services
4. The buyer cannot return the service

The major difference in the education of services marketing versus regular marketing is that apart from the traditional "4 P's," Product, Price, Place, Promotion, there are three additional "P's" consisting of People, Physical evidence, and Process.Service marketing also includes the servicewomen referring to but not limited to the aesthetic appearance of the business from the outside, the inside, and the general appearance of the employees themselves. Service Marketing has been relatively gaining ground in the overall spectrum of educational marketing as developed economies move farther away from industrial importance to service oriented economies. What is marketing? Marketing is the flow of goods and services from the producer to consumer. It is based on relationship and value. In common parlance it is the distribution and sale of goods and services. Marketing can be differentiated as:

• Marketing of products
• Marketing of services.

Marketing includes the services of all those indulged may it be then the wholesaler retailer, Warehouse keeper, transport etc. In this modern age of competition marketing of a product or service plays a key role. It is estimated that almost 50% of the price paid for a commodity goes to the marketing of the product in US. Marketing is now said to be a term which has no particular definition as the definitions change everyday.

"Managing the evidence" refers to the act of informing customers that the service encounter has been performed successfully. It is best done in subtle ways like providing examples or descriptions of good and poor service that can be used as a basis of comparison. The underlying rationale is that a customer might not appreciate the full worth of the service if they do not have a good benchmark for comparisons.

However, it is worth remembering that many of the concepts, as well as many of the specific techniques, will work equally well whether they are directed at products or services. In particular, developing a marketing strategy is much the same for products and services, in that it involves selecting target markets and formulating a marketing mix. Thus, Theodore Levitt suggested that "instead of talking of 'goods' and of 'services', it is better to talk of 'tangibles' and 'intangibles'" Levitt also went on to suggest that marketing a physical product is often more concerned with intangible aspects (frequently the `product service' elements of the total package) than with its physical . sales after service is very imporatant in service sector. properties. Charles Revson made a famous comment regarding the business of Revlon Inc.: `In the factory we make cosmetics. In the store we sell hope.' Arguably, service industry marketing merely approaches the problems from the opposite end of the same spectrum

GREEN MARKETING

ARTICLE BY: DIPU CHANDRAN


Green marketing refers to the process of selling products and/or services based on their environmental benefits. Such a product or service may be environmentally friendly in itself or produced and/or packaged in an environmentally friendly way.

The obvious assumption of green marketing is that potential consumers will view a product or service's "greenness" as a benefit and base their buying decision accordingly. The not-so-obvious assumption of green marketing is that consumers will be willing to pay more for green products than they would for a less-green comparable alternative product - an assumption that, in my opinion, has not been proven conclusively.

While green marketing is growing greatly as increasing numbers of consumers are willing to back their environmental consciousnesses with their dollars, it can be dangerous. The public tends to be skeptical of green claims to begin with and companies can seriously damage their brands and their sales if a green claim is discovered to be false or contradicted by a company's other products or practices. Presenting a product or service as green when it's not is called greenwashing.

Green marketing can be a very powerful marketing strategy though when it's done right.

Also Known As: Environmental Marketing, Ecological Marketing, Eco-Marketing.

KEY TO SUCCESSFUL GREEN MARKETING

Show potential customers that you follow green business practices and you could reap more green on your bottom line. Green marketing isn't just a catchphrase; it's a marketing strategy that can help you get more customers and make more money. But only if you do it right.

For green marketing to be effective, you have to do three things; be genuine, educate your customers, and give them the opportunity to participate.

1) Being genuine means that
a) that you are actually doing what you claim to be doing in your green marketing campaign and
b) that the rest of your business policies are consistent with whatever you are doing that's environmentally friendly. Both these conditions have to be met for your business to establish the kind of environmental credentials that will allow a green marketing campaign to succeed.

2) Educating your customers isn't just a matter of letting people know you're doing whatever you're doing to protect the environment, but also a matter of letting them know why it matters. Otherwise, for a significant portion of your target market, it's a case of "So what?" and your green marketing campaign goes nowhere.

3) Giving your customers an opportunity to participate means personalizing the benefits of your environmentally friendly actions, normally through letting the customer take part in positive environmental action.

Let's put the three essential elements of a successful green marketing campaign together by looking at an example.

Suppose that you have decided that your business will no longer use plastic bags to wrap customer purchases. You know that the traditional plastic bag takes about one thousand years to decompose (cbc.ca) and want to do your part to stop the proliferation of plastic bags in landfills. You feel that this is the kind of environmental action that will be popular with potential customers and a good opportunity to do some green marketing.

To be genuine, you have to ensure that none of your business practices contradict your decision not to use plastic bags. What if customers who happen to walk behind your store see an overflowing trash bin filled with paper, cardboard and plastic bottles? Obviously, he or she will decide that you don't care as much about recycling as you say you do in your green marketing.

Not using plastic bags appears to be environmental no-brainer, but you will still need to educate your target market. Did you know that a single use plastic bag takes about one thousand years to decompose? I didn’t until I researched this article and probably a fair number of otherwise environmentally conscious people don't either. This one little factoid about plastic bags could be used as part of your green marketing campaign - all by itself it lets the public know why single use plastic bags are environmentally disastrous and that you and your business care about the environment.

And the third element? By shopping at your store, the customer is taking action to protect the environment by preventing at least one single use plastic bag from going into a landfill. It doesn't sound like much, but he or she gets the satisfaction of physically doing something that fulfills their beliefs. You can also reinforce your customers’ green decisions and increase their participation by offering them additional related actions, such as buying cloth bags to use for future purchases.

Sometimes the best thing to do with a bandwagon is jump on it. You have to walk the talk and actually implement green policies and act in environmentally friendly ways for green marketing to work, but if you do, you've got a powerful selling point with those who are environmentally conscious and want to act to make the world a greener place - a market that's growing exponentially right now.

Why are firms using green marketing?

1. Organizations perceive environmental marketing to be an opportunity that can be used to achieve its objectives.
2. Organizations believe they have a moral obligation to be more socially responsible.
3. Governmental bodies are forcing firms to become more responsible
4. Increasing consumer awareness and role of NGOs
5. Competitors' environmental activities pressure firms to change their environmental marketing activities.
6. Cost factors associated with waste disposal, or reductions in material usage forces firms to modify their behavior.

Eco Mark Scheme: BIS is operating Eco Mark Scheme for labeling of household and other consumer products which meet certain environmental criteria along with quality requirements prescribed in relevant Indian standards.

Organizations perceive environmental marketing to be an opportunity that can be used to achieve its objectives

It appears that all types of consumers, both individual and industrial are becoming more concerned and aware about the natural environment. About 25% of the Indian consumers in India consider environment friendly products to be safe for nature. Another 28% are concerned with safety to human health and happiness and protective to nature. As demands change, many firms see these changes as an opportunity to be exploited.
Given these figures, it can be assumed that firms marketing goods with environmental characteristics will have a competitive advantage over firms marketing non-environmentally responsible alternatives. There are numerous example of firms who have strived to become more environmentally responsible, in an attempt to better satisfy their consumer needs. Moreover, their activities also help them to improve their revenues and profits in various ways.

• New Surf Exel (Do Bucket Paani… Ab Rozana Hai Bachana) that produces lesser froth but is as effective as before, thus reducing water consumption. Similarly, Lifeboy (a brand of soap from Unilever in India) had an advertising campaign encuraging children to keep their streets clean and not worry about germs as Lifeboy protects them.
• McDonalds changed its plastic packaging with waxed paper owing to increasing consumers’ concern about plastics and their ill effects.
• Tata Steel, HLL, Jindal Vijaynagar Steel, Essar Power and Gujarat Flurochemicals Ltd. etc have got clearance from the CDM (clean development mechanism) body to undertake specifically designed projects in order to gain benefits from carbon trading (Kyoto Protocol).

Role of CTO in Organisations

posted by: MITHUN MOHAN

Introduction
The significant role of technology in strategic business decisions has created the need for executives who understand technology and recognize profitable applications to products, services, and applications to products, services, and processes. Many companies have addressed this need through the appointment of a Chief Technology Officer (CTO) whose responsibilities include monitoring new technologies and assessing their potential to become new products or services, overseeing the selection of research projects to insure that they have the potential to add value to the company, providing reliable technical assessments of potential mergers and acquisitions, explaining company products and future plans to the trade media, and participating in government, academic, and industry groups where there are opportunities to promote the company’s reputation and to capture valuable data.
Integrating these technology-based activities into the corporate strategy requires that the CTO nurture effective relationships with key people throughout the company. These include the CEO, members of the Executive Committee, chief scientists, research laboratory directors, and marketing leaders.
The role of the CTO within each organization can be simply stated as that of the primary interpreter of operational technology issues and decisions. As the role of the CIO faces outward and is concerned with policy and strategy, the complementary role of the CTO faces toward the organization’s needs, use, and replenishment of technology within strategic and policy guidelines. Historically, many CIOs performed both roles; the increasing complexity and expanding role of technology, along with expanded security concerns, have enlarged these roles to be too large a burden for one individual. The CTO role involves a detailed understanding of where technology is going, a vision of where the business should go, and the ability to mesh those together and explain on both sides how that vision is going to be accomplished. Ultimately, the CTO serves as the bridge between the technologists and program areas to help them understand these details in order to make disciplined, proactive IT investment decisions.

Origins of the Chief Technology Officer
In the 1950s and 1960s, many large corporations established beautiful research laboratories at locations remote from their headquarters and manufacturing facilities. The goal was to collect brilliant scientists and allow them to study relevant topics in an environment unhindered by day-to-day business concerns. The director of the laboratory was often a corporate vice president who did not participate in decisions regarding corporate strategy and direction. Instead, his responsibilities were to attract the best scientists, explore new ideas, and publish respected research papers. By the late 1980s, companies began to anoint R&D laboratory directors as Chief Technology Officers. Technology was becoming such a prevalent part of company products and services that senior management needed an operational executive who could understand it and provide reliable advice on its application. However, executive search agencies, under direction from their corporate customers, continued to fill the CTO position with the same people they had recommended leading R&D laboratories.2 Several experiences with these candidates soon made it clear that the responsibilities of the CTO were significantly different from those of the research scientist. The CTO position called for a technologist or scientist who could translate technological capabilities into strategic business decisions. Lewis expresses this very clearly. “The CTO’s key tasks are not those of lab director writ large but, rather, of a technical businessperson deeply involved in shaping and implementing overall corporate strategy.”
Though large companies such as General Electric, Allied-Signal, and ALCOA created the position of CTO in the late 1980s, the position has also played an important role in computer and Internet companies in the late 1990s. Many of these provide products and services that are pure technology. Therefore, the CTO can play a prominent role in directing and shaping their entire business.

Skills and Competencies of an Effective CTO
Technology
The CTO should have been a leader in a technology that is an important part of the corporate business base.
Strategy
The CTO is a corporate executive dealing with strategic decisions about the future direction of the company. The CTO must make the transition from technical expert to business strategists.
Business Growth
CTOs must make decisions about which technologies are most likely to generate the highest rate of return. The CTO thinks about technology as a moneymaking asset, not as a field of exploration for its own sake.
Interpersonal Skills
All executives, including the CTO, must be able to communicate clearly and effectively with people from all types of backgrounds.
Executive Relationships
The CTO position is relatively new in most organizations; therefore, the individual filling the position must insure that he or she is included in the executive decision-making cycle.
The chief technology officer: Strategic responsibilities and relationships
Today's CTO is expected to contribute technology expertise to business strategies-not to create independent research labs and strategies that are only loosely coupled to the company's profit engine.
The significant role of technology in strategic business decisions has created the need for executives who understand technology and recognize profitable applications to products, services and processes. Many companies have addressed this need through the appointment of a chief technology officer (CTO) whose responsibilities include: monitoring new technologies and assessing their potential to become new products or services; overseeing the selection of research projects to ensure that they have the potential to add value to the company; providing reliable technical assessments of potential mergers and acquisitions; explaining company products and future plans to the trade media; and participating in government, academic and industry groups where there are opportunities to promote the company's reputation and to capture valuable data. Integrating these technology-based activities into the corporate strategy requires that the CTO nurture effective relationships with key people throughout the company..
The CTO's key tusks are not those of lab director writ large but, rather, of a technical businessperson deeply involved in shaping and implementing overall corporate strategy.

Strategic Responsibilities of the CTO
The CTO position is far from being standardized. Each company has unique requirements for its CTO and provides a unique organizational structure into which the person will fit. This section describes some of the more prominently cited responsibilities of the CTO.

Monitoring and Assessing New Technologies
The rate of change of technology guarantees that knowledge and expertise gained several years ago will no longer be completely valid. This creates the need for a technologically current person to serve as an advisor to senior executives during strategic decision-making. Paul O’Neill stated that a CTO should be expected to, “identify, access, and investigate high-risk, high return technologies possessing potential application within existing businesses or for creating new businesses”.
Strategy Formulation:

• Senior advisor to Bureau management and the CIO on technology investments and initiatives
• Participating with CIO and other Senior IT leaders including Architecture team in planning the short and long-range technology strategies;
• Providing leadership in ensuring appropriate technology usage
• Developing IT technology standards and protocols in line with federal requirements and industry “best practice;”
• Assesses new and emerging technologies to determine application to Bureau programs and services
• Identify and oversee business process driven technology improvements
• Manages and chairs the IT configuration control board
• Strategic Innovation
  Michael Porter explains that, “companies have to find ways of growing and building advantages rather than just eliminating disadvantages.” A significant part of this is strategic innovation. In some industries, new products based on new technology are the lifeblood of the company. In other industries, core products remain unchanged for decades, but the processes used to create them are continually evolving and becoming more efficient. O’Neill emphasizes that established companies need a CTO to “assure development of fundamental technologies offering clear competitive advantage for current and future businesses.”
  Opportunity Evaluation
• Identifies and evaluates new technology developments and gauges applicability to business processes by providing the Solution Architecture that satisfies business goals and objectives;
• Maintains a current working knowledge of IT best practices and innovative solutions within both government and industry;
• Develops, recommends, influences, and evaluates technology support, infrastructure operation, COTS/GOTS, custom applications, and governing policies;
  Cultivates and maintains knowledge regarding IT best practices and innovative solutions.
  

Tactical Planning and Prioritization

• Recommends, develops, integrates, administers, and evaluates policies, procedures, and standards needed to provide flexible and cost-effective IT services (specifically related to Web Services, Software Development Life Cycle, Technology Refreshment, Solution Architecture, and Technology Research and Collaboration);
  
• Provides Subject Matter Expertise to the Chief Information Officer;
  
• Solves IT business issues while managing IT costs and risks;
  
• Defines essential education and training required for the implementation, operations, and maintenance of Department information technology.
  

The distinguishing feature of all of these roles and responsibilities is their focus on operations. Long-range system architecture, blueprint development, and business process alignment with Departmental policies and strategies are the responsibility of the Chief Architect. The CTO assists in the association and realization of these areas through technology and its application to the operational environment.
Mergers and Acquisitions
Mergers and acquisitions (M&A) are an important part of the growth strategy of many companies. These involve important strategies in financing, governmental oversight, taxation, corporate culture, and technological synergy. The CTO’s role in due diligence includes evaluating patents, reviewing technical publications, and studying trade data to determine the value of the target company and to rank it against its competitors.
Marketing and Media Relations
Media attention to company products and capabilities plays an important role in the success of those products. Constructing the information and images released to the public is primarily the responsibility of the marketing and sales departments. However, technical expertise is required to accurately translate some product details into terms that can be marketed.

Government, Academia, Professional Organizations
Prominent technologists are often called upon to provide services to government, academic, and professional organizations. It is the duty of CTO to provide necessary helps for these activities.
Company Culture
Earlier sections described how the CTO could contribute to strategy, acquisitions, media relations, government committees, and academic research. But, the CTO can also serve an important role in creating the internal culture. The CTO should initiate activities and policies that create a technology-friendly culture aligned with the company’s business strategy. Other technology leaders throughout a company may create policies and practices that attempt to attract and retain the highest quality people available. However, if these are not aligned with the corporate business strategy, they may attract excellent people who are not able to contribute to business objectives.
The CTO should insure that policies and practices are constructed to attract the right kind, right number, and right placement of technologists. This will require the establishment of formal and informal networks to implement the policies and to insure that they are aligned throughout the company. These networks will also serve as the conduits through which corporate vision and direction can be communicated.

Conclusion

It is important that the CTO not become the senior technologist of the company. Instead, he or she is the senior business executive with a focus on technology. In the CTO position, senior management is not looking for enthusiastic advice from a research scientist. Instead, they need sound advice on business decisions involving technology.

Gita for Managers

ARTICLE BY: SREERANJ SREENIVASAN

Introduction

Management has become a part and parcel of everyday life, be it at home, in the office or factory and in Government. In all organizations, where a group of human beings assemble for a common purpose, management principles come into play through the management of resources, finance and planning, priorities, policies and practice. Management is a systematic way of carrying out activities in any field of human effort.
Its task is to make people capable of joint performance, to make their weaknesses irrelevant, says the Management Guru Peter Drucker. It creates harmony in working together - equilibrium in thoughts and actions, goals and achievements, plans and performance, products and markets. It resolves situations of scarcity, be they in the physical, technical or human fields, through maximum utilization with the minimum available processes to achieve the goal. Lack of management causes disorder, confusion, wastage, delay, destruction and even depression. Managing men, money and materials in the best possible way, according to circumstances and environment, is the most important and essential factor for a successful management.

Management guidelines from the Bhagavad Gita

There is an important distinction between effectiveness and efficiency in managing.
Effectiveness is doing the right things.
Efficiency is doing things right.
The general principles of effective management can be applied in every field, the differences being more in application than in principle. The Manager's functions can be summed up as:
Forming a vision
Planning the strategy to realize the vision.
Cultivating the art of leadership.
Establishing institutional excellence.
Building an innovative organization.
Developing human resources.
Building teams and teamwork.
Delegation, motivation, and communication.
Reviewing performance and taking corrective steps when called for.
Thus, management is a process of aligning people and getting them committed to work for a common goal to the maximum social benefit - in search of excellence.
The critical question in all managers' minds is how to be effective in their job. The answer to this fundamental question is found in the Bhagavad Gita, which repeatedly proclaims that “you must try to manage yourself.” The reason is that unless a manager reaches a level of excellence and effectiveness, he or she will be merely a face in the crowd.

Old truths in a new context

The Bhagavad Gita, written thousands of years ago, enlightens us on all managerial techniques leading us towards a harmonious and blissful state of affairs in place of the conflict, tensions, poor productivity, absence of motivation and so on, common in most of Indian enterprises today – and probably in enterprises in many other countries.
The modern (Western) management concepts of vision, leadership, motivation, excellence in work, achieving goals, giving work meaning, decision making and planning, are all discussed in the Bhagavad Gita. There is one major difference. While Western management thought too often deals with problems at material, external and peripheral levels, the Bhagavad Gita tackles the issues from the grass roots level of human thinking. Once the basic thinking of man is improved, it will automatically enhance the quality of his actions and their results.
The management philosophy emanating from the West, is based on the lure of materialism and on a perennial thirst for profit, irrespective of the quality of the means adopted to achieve that goal. This phenomenon has its source in the abundant wealth of the West and so 'management by materialism' has caught the fancy of all the countries the world over, India being no exception to this trend. My country, India, has been in the forefront in importing these ideas mainly because of its centuries old indoctrination by colonial rulers, which has inculcated in us a feeling that anything Western is good and anything Indian is inferior.
The result is that, while huge funds have been invested in building temples of modem management education, no perceptible changes are visible in the improvement of the general quality of life - although the standards of living of a few has gone up. The same old struggles in almost all sectors of the economy, criminalisation of institutions, social violence, exploitation and other vices are seen deep in the body politic.

The source of the problem

The reasons for this sorry state of affairs are not far to seek. The Western idea of management centres on making the worker (and the manager) more efficient and more productive. Companies offer workers more to work more, produce more, sell more and to stick to the organisation without looking for alternatives. The sole aim of extracting better and more work from the worker is to improve the bottom-line of the enterprise. The worker has become a hireable commodity, which can be used, replaced and discarded at will.
Thus, workers have been reduced to the state of a mercantile product. In such a state, it should come as no surprise to us that workers start using strikes (gheraos) sit-ins, (dharnas) go-slows, work-to-rule etc. to get maximum benefit for themselves from the organisations. Society-at-large is damaged. Thus we reach a situation in which management and workers become separate and contradictory entities with conflicting interests. There is no common goal or understanding. This, predictably, leads to suspicion, friction, disillusion and mistrust, with managers and workers at cross purposes. The absence of human values and erosion of human touch in the organisational structure has resulted in a crisis of confidence.
Western management philosophy may have created prosperity – for some people some of the time at least - but it has failed in the aim of ensuring betterment of individual life and social welfare. It has remained by and large a soulless edifice and an oasis of plenty for a few in the midst of poor quality of life for many.
Hence, there is an urgent need to re-examine prevailing management disciplines - their objectives, scope and content. Management should be redefined to underline the development of the worker as a person, as a human being, and not as a mere wage-earner. With this changed perspective, management can become an instrument in the process of social, and indeed national, development.
Now let us re-examine some of the modern management concepts in the light of the Bhagavad Gita which is a primer of management-by-values.

Utilisation of available resources

The first lesson of management science is to choose wisely and utilise scarce resources optimally. During the curtain raiser before the Mahabharata War, Duryodhana chose Sri Krishna's large army for his help while Arjuna selected Sri Krishna's wisdom for his support. This episode gives us a clue as to the nature of the effective manager - the former chose numbers, the latter, wisdom.

Work commitment

A popular verse of the Gita advises “detachment” from the fruits or results of actions performed in the course of one's duty. Being dedicated work has to mean “working for the sake of work, generating excellence for its own sake.” If we are always calculating the date of promotion or the rate of commission before putting in our efforts, then such work is not detached. It is not “generating excellence for its own sake” but working only for the extrinsic reward that may (or may not) result.
Working only with an eye to the anticipated benefits, means that the quality of performance of the current job or duty suffers - through mental agitation of anxiety for the future. In fact, the way the world works means that events do not always respond positively to our calculations and hence expected fruits may not always be forthcoming. So, the Gita tells us not to mortgage present commitment to an uncertain future.
Some people might argue that not seeking the business result of work and actions, makes one unaccountable. In fact, the Bhagavad Gita is full of advice on the theory of cause and effect, making the doer responsible for the consequences of his deeds. While advising detachment from the avarice of selfish gains in discharging one's accepted duty, the Gita does not absolve anybody of the consequences arising from discharge of his or her responsibilities.
Thus the best means of effective performance management is the work itself. Attaining this state of mind (called “nishkama karma”) is the right attitude to work because it prevents the ego, the mind, from dissipation of attention through speculation on future gains or losses.

Motivation – self and self-transcendence

It has been presumed for many years that satisfying lower order needs of workers - adequate food, clothing and shelter, etc. are key factors in motivation. However, it is a common experience that the dissatisfaction of the clerk and of the Director is identical - only their scales and composition vary. It should be true that once the lower-order needs are more than satisfied, the Director should have little problem in optimising his contribution to the organisation and society. But more often than not, it does not happen like that. (“The eagle soars high but keeps its eyes firmly fixed on the dead animal below.”) On the contrary, a lowly paid schoolteacher, or a self-employed artisan, may well demonstrate higher levels of self-actualisation despite poorer satisfaction of their lower-order needs.
This situation is explained by the theory of self-transcendence propounded in the Gita. Self-transcendence involves renouncing egoism, putting others before oneself, emphasising team work, dignity, co-operation, harmony and trust – and, indeed potentially sacrificing lower needs for higher goals, the opposite of Maslow.
“Work must be done with detachment.” It is the ego that spoils work and the ego is the centrepiece of most theories of motivation. We need not merely a theory of motivation but a theory of inspiration.
The Great Indian poet, Rabindranath Tagore (1861-1941, known as “Gurudev”) says working for love is freedom in action. A concept which is described as “disinterested work” in the Gita where Sri Krishna says,
“He who shares the wealth generated only after serving the people, through work done as a sacrifice for them, is freed from all sins. On the contrary those who earn wealth only for themselves, eat sins that lead to frustration and failure.”
Disinterested work finds expression in devotion, surrender and equipoise. The former two are psychological while the third is determination to keep the mind free of the dualistic (usually taken to mean “materialistic”) pulls of daily experiences. Detached involvement in work is the key to mental equanimity or the state of “nirdwanda.” This attitude leads to a stage where the worker begins to feel the presence of the Supreme Intelligence guiding the embodied individual intelligence. Such de-personified intelligence is best suited for those who sincerely believe in the supremacy of organizational goals as compared to narrow personal success and achievement.

Work culture

An effective work culture is about vigorous and arduous efforts in pursuit of given or chosen tasks. Sri Krishna elaborates on two types of work culture – “daivi sampat” or divine work culture and “asuri sampat” or demonic work culture.
Daivi work culture - involves fearlessness, purity, self-control, sacrifice, straightforwardness, self-denial, calmness, absence of fault-finding, absence of greed, gentleness, modesty, absence of envy and pride.
Asuri work culture - involves egoism, delusion, personal desires, improper performance, work not oriented towards service.
Mere work ethic is not enough. The hardened criminal exhibits an excellent work ethic. What is needed is a work ethic conditioned by ethics in work.
It is in this light that the counsel, “yogah karmasu kausalam” should be understood. “Kausalam” means skill or technique of work which is an indispensable component of a work ethic. “Yogah” is defined in the Gita itself as “samatvam yogah uchyate” meaning an unchanging equipoise of mind (detachment.) Tilak tells us that acting with an equable mind is Yoga.
(Bal Gangadhar Tilak, 1856-1920, the precursor of Gandhiji, hailed by the people of India as “Lokmanya,” probably the most learned among the country's political leaders. For a description of the meanings of the word “Yoga”, see foot of this page.)
By making the equable mind the bed-rock of all actions, the Gita evolved the goal of unification of work ethic with ethics in work, for without ethical process no mind can attain an equipoise. The guru, Adi Sankara (born circa 800 AD), says that the skill necessary in the performance of one's duty is that of maintaining an evenness of mind in face of success and failure. The calm mind in the face of failure will lead to deeper introspection and see clearly where the process went wrong so that corrective steps could be taken to avoid shortcomings in future.
The principle of reducing our attachment to personal gains from the work done is the Gita's prescription for attaining equanimity. It has been held that this principle leads to lack of incentive for effort, striking at the very root of work ethic. To the contrary, concentration on the task for its own sake leads to the achievement of excellence – and indeed to the true mental happiness of the worker. Thus, while commonplace theories of motivation may be said to lead us to the bondage or extrinsic rewards, the Gita's principle leads us to the intrinsic rewards of mental, and indeed moral, satisfaction.

Work results

The Gita further explains the theory of “detachment” from the extrinsic rewards of work in saying:
If the result of sincere effort is a success, the entire credit should not be appropriated by the doer alone.
If the result of sincere effort is a failure, then too the entire blame does not accrue to the doer.
The former attitude mollifies arrogance and conceit while the latter prevents excessive despondency, de-motivation and self-pity. Thus both these dispositions safeguard the doer against psychological vulnerability, the cause of the modem managers' companions of diabetes, high blood pressure and ulcers.
Assimilation of the ideas of the Gita leads us to the wider spectrum of “lokasamgraha” (general welfare) but there is also another dimension to the work ethic - if the “karmayoga” (service) is blended with “bhaktiyoga” (devotion), then the work itself becomes worship, a “sevayoga” (service for its own sake.)
Along with bhakti yoga as a means of liberation, the Gita espouses the doctrine of nishkamya karma or pure action untainted by hankering after the fruits resulting from that action. Modern scientists have now understood the intuitive wisdom of that action in a new light.
Scientists at the US National Institute of Mental Health in Bethesda, found that laboratory monkeys that started out as procrastinators, became efficient workers after they received brain injections that suppressed a gene linked to their ability to anticipate a reward.The scientists reported that the work ethic of rhesus macaques wasn't all that different from that of many people: “If the reward is not immediate, you procrastinate”, Dr Richmond told LA Times.
(This may sound a peculiarly religious idea but it has a wider application. It could be taken to mean doing something because it is worthwhile, to serve others, to make the world a better place – ed.)

Manager's mental health

Sound mental health is the very goal of any human activity - more so management. Sound mental health is that state of mind which can maintain a calm, positive poise, or regain it when unsettled, in the midst of all the external vagaries of work life and social existence. Internal constancy and peace are the pre-requisites for a healthy stress-free mind.
Some of the impediments to sound mental health are:
Greed - for power, position, prestige and money.
Envy - regarding others' achievements, success, rewards.
Egotism - about one's own accomplishments.
Suspicion, anger and frustration.
Anguish through comparisons.
The driving forces in today's businesses are speed and competition. There is a distinct danger that these forces cause erosion of the moral fibre, that in seeking the end, one permits oneself immoral means - tax evasion, illegitimate financial holdings, being “economical with the truth”, deliberate oversight in the audit, too-clever financial reporting and so on. This phenomenon may be called as “yayati syndrome”.
In the book, the Mahabharata, we come across a king by the name of Yayati who, in order to revel in the endless enjoyment of flesh exchanged his old age with the youth of his obliging youngest son for a thousand years. However, he found the pursuit of sensual enjoyments ultimately unsatisfying and came back to his son pleading him to take back his youth. This “yayati syndrome” shows the conflict between externally directed acquisitions (extrinsic motivation) and inner value and conscience (intrinsic motivation.)

Management needs those who practice what they preach

“Whatever the excellent and best ones do, the commoners follow,” says Sri Krishna in the Gita. The visionary leader must be a missionary, extremely practical, intensively dynamic and capable of translating dreams into reality. This dynamism and strength of a true leader flows from an inspired and spontaneous motivation to help others. “I am the strength of those who are devoid of personal desire and attachment. O Arjuna, I am the legitimate desire in those, who are not opposed to righteousness,” says Sri Krishna in the 10th Chapter of the Gita.

Conclusion

The despondency of Arjuna in the first chapter of the Gita is typically human. Sri Krishna, by sheer power of his inspiring words, changes Arjuna's mind from a state of inertia to one of righteous action, from the state of what the French philosophers call “anomie” or even alienation, to a state of self-confidence in the ultimate victory of “dharma” (ethical action.)
When Arjuna got over his despondency and stood ready to fight, Sri Krishna reminded him of the purpose of his new-found spirit of intense action - not for his own benefit, not for satisfying his own greed and desire, but for the good of many, with faith in the ultimate victory of ethics over unethical actions and of truth over untruth.
Sri Krishna's advice with regard to temporary failures is, “No doer of good ever ends in misery.” Every action should produce results. Good action produces good results and evil begets nothing but evil. Therefore, always act well and be rewarded.
My purport is not to suggest discarding of the Western model of efficiency, dynamism and striving for excellence but to tune these ideals to India's holistic attitude of “lokasangraha” - for the welfare of many, for the good of many. There is indeed a moral dimension to business life. What we do in business is no different, in this regard, to what we do in our personal lives. The means do not justify the ends. Pursuit of results for their own sake, is ultimately self-defeating. (“Profit,” said Matsushita-san in another tradition, “is the reward of correct behaviour.” – ed.)

How Cognitive Dissonance Skews Marketing Surveys

posted by: suji krishnan. s

How Cognitive Dissonance Skews Marketing Surveys


Cognitive dissonance: It's the discomfort caused by two conflicting thoughts. It's the pain of learning something new that contradicts what's already accepted as true. And it's often strongest when a person believes something about himself, but acts in a contradictory fashion. Dr. Leon Festinger, then of the University of Minnesota, first proposed the theory of cognitive dissonance after studying a doomsday cult lead by a suburban Minneapolis housewife. Marion Keech was convinced that aliens would rescue her and her followers before a massive flood occured at midnight, December 20, 1954. Many of the cult members waiting for the end of the world quit their jobs, sold their homes, and gave away their belongings and savings. What does a cult follower do when faced with incontrovertible evidence that his beliefs are wrong? He rationalizes. And interestingly, his belief becomes even stronger. Rather than admit they had changed their lives on an invalid premise (and rather than risk being laughed at), Keech's followers chose to believe their faith had persuaded the aliens to save the world. Dr. Festinger explained that the more important conflicting ideas are to a person the greater the cognitive dissonance they cause. The discomfort also increases when accepting the validity of one idea requires the complete denunciation of the other. If a person can't rationalize, or explain away the discrepancy, he suffers. And according to Festinger, when teaching the new information forces people to compromise their self-image, they will not learn from their mistakes. Instead of admitting their own fallibility, they'll continue making the same bad choices. (This denial of the evidence also contributes to confirmation bias, in which an individual picks and chooses among the “facts” he'll accept as true.)
How does cognitive dissonance affect marketing surveys?
One of the least reliable methods of predicting consumer behaviour is to ask consumers what they intend to do. And yet, companies keep using “intent to purchase” surveys to determine the course of their business.
“Do you intend to purchase a hard drive? A dishwasher? A case of Cabernet Sauvignon? A new home?”
Do people really know what they're going to buy?
“In the next year will you buy a digital camera? Shares of stock? An iPhone? A timeshare? A second vehicle?”
Does anyone know?
Some do. Most don't.
Why is that?
When the ideal of “what I want” collides with the reality of “what I can afford,” cognitive dissonance is the likely outcome. We're a nation of optimists. We all want to believe that next year will be better than this one. It's painful to admit that we don't have the power to create the lives we want, even when we only have to admit it to ourselves.
So we deny. We rationalize. We hope. And we don't tell the researchers what we suspect to be true. We don't even tell them what we think they want to hear. We tell them how we see ourselves.
What can you expect when you ask what people want?
You can expect them not to care that you want to know. You can expect them not to want to do any mental work to help you get to your answers. You can expect the vast majority to refuse to answer. They don't have time. And expect that most don't truly know what they want. By definition, any of these folks who take your survey are giving an inaccurate description of their preferences. Those who know what they want, and complete your survey, often provide incomplete answers. And in those very few cases where your survey does compile a complete and accurate description of your customer's preferences, what you have is a static picture of a constantly moving target. Over time, those preferences will become stale and less accurate. And there's still the question of what you're measuring. When you ask about intent to purchase, are you measuring stated preferences? Behavioral preferences? Predictive behavior? Are they the same? If not, how do they differ?
The lesson: Be very careful with intentions.
Frankly, the only reliable data tracks behaviors. Actual purchases. Not what people want, but what they've actually paid for. A recent study of automobile shoppers indicates that 58 percent of those who bought, drove off in a car other than the one they came looking for. And when questioned, a full 42 percent arrived at the lot without having made a clear choice between a new vehicle and a used one. Maybe what they were “just looking” for was a good salesperson. Regardless, you can easily see that surveying intention to purchase provides pretty much useless data. Information is moving faster than ever. The rate of change keeps accelerating. And it's unfortunate that in some industries, by the time changes in customer behavior have become obvious, its too late to adjust and stay competitive.
How can you predict what people will buy?
Even people who don't know what they want can usually rank their preferences. Ask them to choose between options. Ask them for trade offs. Help them to the decision point. Help them to choose which products, or even features and benefits are worth more to them. Would they like a cell phone that can give them directions to the nearest Italian restaurant? Sure. Who wouldn't? Would they pay an extra $100 for it? Ehhhhhh, maybe not. If there was only one extra feature beyond basic telephone service, would they give up the ability to play MP3s in order to have those restaurant directions? Absolutely not. Would they give up the four function calculator? OK, perhaps they would, but they still won't pay extra for the directions. Ah, now you have a way to uncover some truly meaningful information about market demand. In the absence of actual sales data, identifying the trade offs important to your customers will give you a much better understanding of what they'll pay for.

ENTREPRENEURSHIP - BRIEF HISTORY

POSTED BY: NAJEEM BABU U.K

Entrepreneurship is the act of being an entrepreneur which is a French word meaning one who undertakes an endeavor. Entrepreneurs assemble resources including innovations, finance and business acumen in an effort to transform innovations into economic goods. This may result in new organizations or may be part of revitalizing mature organizations in response to a perceived opportunity. The most obvious form of entrepreneurship is that of starting new businesses; however, in recent years, the term has been extended to include social and political forms of entrepreneurial activity. When entrepreneurship is describing activities within a firm or large organization it is referred to as intra-preneurship and may include corporate venturing, when large entities start spin-off organizations.

Entrepreneurship is often a difficult undertaking, as a vast majority of new businesses fail. Entrepreneurial activities are substantially different depending on the type of organization that is being started. Entrepreneurship ranges in scale from solo projects (even involving the entrepreneur only part-time) to major undertakings creating many job opportunities. Many "high value" entrepreneurial ventures seek venture capital or angel funding in order to raise capital to build the business. Angel investors generally seek returns of 20-30% and more extensive involvement in the business. Many kinds of organizations now exist to support would-be entrepreneurs, including specialized government agencies, business incubators, science parks, and some NGOs. Lately more holisitc conceptualizations of entrepreneurship as a specific mindset (see also entrepreneurial mindset) resulting in entrepreneurial initiatives e.g. in the form of social entrepreneurship, political entrepreneurship, or knowledge entrepreneurship emerged.
HISTORY

The entrepreneur is a actor in microeconomics, and the study of entrepreneurship reaches back to the work of Richard Cantillon and Adam Smith in the mid-16th century, but was largely ignored theoretically until the late 19th and early 20th centuries and empirically until a profound resurgence in business and economics in the last 40 years.

In the 20th century, the understanding of entrepreneurship owes much to the work of economist Joseph Schumpeter in the 1940s and other Austrian economists such as Carl Menger, Ludwig von Mises and Friedrich von Hayek. In Schumpeter, an entrepreneur is a person who is willing and able to convert a new idea or invention into a successful innovation.^[3] Entrepreneurship employes what Schumpeter called "the gale of creative destruction" to replace in whole or in part inferior innovations across markets and industries, simultaneously creating new products including new business models. In this way, creative destruction is largely responsible for the dynamism of industries and long-run economic growth. The supposition that entrepreneurship leads to economic growth is an interpretation of the residual in endogenous growth theory and as such is hotly debated in academic economics. An alternate, description posited by Israel Kirzner suggests that the majority of innovations may be much more incremental improvements such as the replacement of paper with plastic in the construction of a drinking straw.

For Schumpeter, entrepreneurship resulted in new industries but also in new combinations of currently existing inputs. Schumpeter's initial example of this was the combination of a steam engine and then current wagon making technologies to produce the horseless carriage. In this case the innovation, the car, was transformational but did not require the development of a new technology, merely the application of existing technologies in a novel manner. It did not immediately replace the horsedrawn carriage, but in time, incremental improvements which reduced the cost and improved the technology led to the complete practical replacement of beast drawn vehicles in modern transportation. Despite Schumpeter's early 20th-century contributions, traditional microeconomic theory did not formally consider the entrepreneur in its theoretical frameworks (instead assuming that resources would find each other through a price system). In this treatment the entrepreneur was an implied but unspecified actor, but it is consistent with the concept of the entrepreneur being the agent of x-efficiency.

Different scholars have described entrepreneurs as, among other things, baring risk. For Schumpeter, the entrepreneur did not bare risk: the capitalist did.

Some notable persons and their works in entrepreneurship history.

For Frank H. Knight (1921) and Peter Drucker (1970) entrepreneurship is about taking risk. The behavior of the entrepreneur reflects a kind of person willing to put his or her career and financial security on the line and take risks in the name of an idea, spending much time as well as capital on an uncertain venture. Knight classified three types of uncertainty.

• Risk, which is measurable statistically (such as the probability of drawing a red colour ball from a jar containing 5 red balls and 5 white balls).
• Ambiguity, which is hard to measure statistically (such as the probability of drawing a red ball from a jar containing 5 red balls but with an unknown number of white balls).
• True Uncertainty or Knightian Uncertainty, which is impossible to estimate or predict statistically (such as the probability of drawing a red ball from a jar whose number of red balls is unknown as well as the number of other coloured balls).

The acts of entrepreneurship is often associated with true uncertainty, particularly when it involves bringing something really novel to the world, whose market never exists. However, even if a market already exists, there is no guarantee that a market exists for a particular new player in the cola category.

The place of the disharmony-creating and idiosyncratic entrepreneur in traditional economic theory (which describes many efficiency-based ratios assuming uniform outputs) presents theoretic quandaries. William Baumol has added greatly to this area of economic theory and was recently honored for it at the 2006 annual meeting of the American Economic Association.

The entrepreneur is widely regarded as an integral player in the business culture of American life, and particularly as an engine for job creation and economic growth. Robert Sobel published The Entrepreneurs: Explorations Within the American Business Tradition in 1974. Zoltan Acs and David Audretsch have produced an edited volume surveying Entrepreneurship as an academic field of research, and more than a hundred scholars around the world track entrepreneurial activity, policy and social influences as part of the Global Entrepreneurship Monitor (GEM) and its associated reports.

VALUE CREATION. By Sreeranj Sreenivasan

VALUE CREATION

Value creation is a term that crops up so often and in so many contexts that it is tempting to dismiss it as just another business buzzword. It is anything but. Value creation is the animating principle of modern management and its chief responsibility. It reflects a view of what perfomance is and how organizations perform.

What Is Value?

In industrial markets calculating the economic value of a good or service (that is, determining how much it’s worth) is often fairly straightforward. The value created for the customer usually resides in time or labor or materials saved, and those savings can be quickly translated into a cash equivalent.
But the service may also create value in another way. In consumer business, which account for two-thirds of the U.S. economy, there is usually a difficult –to-quantify leap to be made between the product or service delivered and the value created. Charles Revson, the cosmetic executive, once quipped that his industry sells “hope in a jar”. For consumers, value often resides in such intagibles: in a product’s look and feel; in emotions such as nostalgia; in status and prestige. When people are asked what single item they’d in the event of fire, they seldome talk aboutthe most expensive thing in the hose. They talk about the family photographs. Even here , where value seems to defy definition, it is possible.

Customers Define Value.

Value then not only takes many forms, but also it comes from many sources – from a produc’s usefulness, its quality, the image associated with it ( by advertising and promotion), its availability, the service that accompanies it. The more intangible the value appears, the more important it is to recognize that value is defined by customers, one person at a time. Many people love fast food, but many hate it. Some people swear by their cell phones, others swear at people who use them in public places. A two week vacation in a primitive nature sanctry is one person’s heaven, and anothers hell.
When management defines its objective as ceating value for customers, it means the organization exist s to serve the needs of people who are outside it. This is what diffrentiate an organization from a tribe, a social club, a family, or another group that focuses only on the well being of its members. One of management’s chief responsibilities is to remember this external orientation and to remind others about it constantly.
Constant reminders are necessary, because it’s natural for people to who live inside an organization to get wrapped up in what they do, to focus on what they make. The may forget to look outside, how the customers valueing their products. One of the most powerful insights of modern management is that there is really only one test of a job well done – a customer who is willing to pay for it.
Customers don’t care how much hard work or ingenuity goes into designing a product. In the 1990s, for example, Silicon Graphics had some of the best engineers in the Valley. The company pored million of dollars into the development of interactive television, which its engineers rightly thought was a ground – breaking technology. But ITV turned out to be a product in search of a customer. Kittu Kolliri, one of the lead engineers , explained company’s fiasco this way: “ We got all wrapped up in the technology. We all thought, ‘Dammit this technology is so cool. It must bring value to someone.’” It didn’t. Bringing vale to some vaguely defined someone isn’t good enough. Only by meeting the needs of customers as customers themselves define those needs, can an organization perform.

Value as Efficiency: The Manufacturing Mindset

Recently we talk about customers and their insight about value. Historically business were defined by producers, what they made. A company was in the steel business, say, or the coffee business or the car business. The way to succeed was to figure out how to make more steel or more coffee or cars using the same or fewer resources.
The challenge in other words, was to increase productivity, and the way to that was to make the production process as efficient as possible. This focus on efficiency made great sense in an industrial economy in which demand far out stripped supply. Management’s mission was making more things, more cheaply. Making the product affordable created a vast new market.
They assumed that value meant making whatever you were making more efficiently. They were not wrong, they were just narrow in how they thought about management’s mission. It didn’t occur to them to question whether they were making the right things to begin with, or whether you could create more value by undertaking broader missions. It was a reasonable assumption to make at the beginning of the twentieth century, when the number of goods produced was relatively small, and the major challenge was simply to produce more of them at lower cost. But now the scenario has been changed. So, the question – what is value? – needed a new answer.

The Marketing Mindset: What Does the Customer Value?

Peter Drucker in his landmark book, The Practice of Management, offered a critical redefinition of value. Efficiency was necessary, but not sufficient. Customers don’t buy products, drucker observed, they buy the satisfaction of particular needs. This means that what the customer values and buys is often different from what the producer thinks he sells.
Defining value as efficiency, led to an intense focus inward, on what company makes and how it makes it. This has become known as the manufacturing mindset. It suggests that you start with what you make, you price it based on what it cost you and then you sell it to the customer. It is a make – and – sell model of how a business works.
Drucker urged a completely new way of thinking. If you want to understand value, don’t focus inward on what you make, the way the engineers developing ITV did it. Look through customer’s eyes, from outside in. The new perspective became known as marketing mindset. It is a sense – and – respond model that starts with that what the customers wants, and with how much she or he is willing to pay for it. This determines both what you make and how much you can spend making it.
Entrepreneurs who succeed always create value for customers. But over time, organizations, especially large ones, tend to make on lives of their own, and can lose touch with the market surprisingly quickly. This is why drucker’s discipline remains such an important antidote to the natural tendency to focus inward, on what you make and you do.

Maximizing Shareholder Value: A Parenthetical Perspective.

Till this point, we didn’t consider another important group for discussion – they are shareholders. Managers are more responsive to the interest of owners, and more aware of the direct link between delivering value to customers and creating value for shareholders. In some industries, satisfactory underperformance had been a kind of gentlemen’s agreement. Those days were gone. Now shareholders would set the bar, and the capital markets would define performance.
Economists like Milton Friedman argue that the shareholder must always come first, that the goal of management, purely and simply, is to maximize shareholder value. Although individual managers may differ in their social philosophies, no contemporary CEO can afford to take the capital markets for granted or ignore their discipline. Thus, it has become more critical than ever for executives to understand the process of value creation and the drivers of superior performance.

How Is Value Created?

Over the past two decades, management has been transformed by the insights about how value is created and the need, therefore, to manage across the organization’s boundaries. For example, a decade ago, purchasing was a low profile function, the goal of which was to get the best terms for a predetermined set of items. Today purchasing has evolved into supply-chain-management, and this is a real shift, not just an instance of title inflation. Supply-chain management reflects a far more systematic way of thinking about how a company creates value for its customers: through what it buys and not just the price it pays, through access to suppliers know – how and innovative capability as well as its goods.
The value creation we’ve been describing has worked its way into every aspect of a company’s business. When organizations look from outside in, they often see a brave new world of innovative offerings in the form of solutions and value – added services aimed at customers’ needs, not simply selling them products. To get a sense of how dramatically this can transform a company, consider how GE has changed under Jack Welch’s leadership. Once one of the world’s premier industrial companies, GE now gets 80 percent of its from services.
GE has not been alone in discovering that often more money can be made from the services related to a product than from the product itself. Consider the service contract that you are offered when you buy a new television or computer, or the financing available from the dealer who sells you a new car. Much of IBM’s success in the 1990s reflected its shift in strategy from hardware to solutions. In the new economy, value lies increasingly in such intangibles.

Value Is a System

This article with the assertion that management’s chief responsibility is to create value. But whether it has delivered on its responsibility isn’t management’s call to make. That is the province of outsiders who are free to decide, day by day and year after year, whether they will continue to support that organisation.
Determining who the relevant outsiders are may be management’s single most critical decision. In the business world, customers aren’t the only constituency modern management has to satisfy. In reality, every successful organisation depends on multiple players, each of whom defines value in a particular way.
Shareholders and others who provide investment capital define value in financial terms that are easy to measure. For employees, the equation is more complex. They value today’s wages and health benefits, but they are also likely to price such things as training or stock options whose value lies in the future. Value or employees may also reside in such noneconomic factors as job satisfaction, status or pride. Suppliers may value long term relationships and the chance to develop cutting-edge technology as much as they care about price alone.
Modern management’s challenge is to ensure that each of these necessary players will choose to participate in the system that creates value for all of them. The term value creation captures this larger, more systematic understanding of performance in a way that earlier definitions of performance did not. Value creation includes the industrial era’s focus on efficiency, as well as the consumer era’s focus on the customer, o quality, and on choice, but it is capacious enough to include all of modern management’s other constituents as well.