National Institute of Business Management

Ist Floor, Swathandrya Samara Smrithi Bhavan, Nandavanam Road

Palayam P.O. Trivandrum – 695 033
E-mail: [email protected]
0471- 4014294, 4014298

Assignments of One Year MBA

Semester - II
1. Students are requested to go through the instructions carefully.
2. The Assignment is a part of the internal assessment.
3. Marks will be awarded for each Assignment, which will be added to the total marks.
Assignments carry equal marks.
4. Assignments should submit in your 'portal' on/before the 'completion date'
mentioned.
5. Case study project is based on the elective subject selected.
Please submit your case study also in the portal on the 'completion date' of
second semester assignments.

Assignments Total Marks :100

1. International Law
What are the principles of International Law. Explain.

Ans) WTO is an international organization that brings together two concepts of

international law.

Leaving aside one or two specificities, it is a permanent negotiating forum between

sovereign states and

is therefore a cooperation organization akin to the international conferences under

traditional international law. But it also comprises a sophisticated dispute settlement
mechanism which makes it an integration organization, rooted in contemporary
international law. In simple terms, the WTO’s sophisticated dispute settlement
mechanism makes it a distinctive organization.

Above all, the WTO comprises a true legal order. If we go by professor Jean
Salmon’s definition, “a body of rules of law constituting a system and governing a
particular society or grouping”, we

see that there exists, within the international legal order, a specific WTO legal order.
The WTO system

has two essential attributes: valid rules, and enforcement mechanisms. But the fact
that it is specific does

not mean that it is insularized or isolated. These are firstly how this legal system fits
into the international

legal order, and secondly, how it links in with the other legal systems.
ORIGIN OF INTERNATIONAL LAW

Trade is at the origin of entire segments of public international law, and accounts for
one of its

main sources: the treaty. Indeed, one of the first international legal instruments to
leave its trace in

history was the commercial treaty between Amenophis IV and the king of Alasia
(Cyprus) during the

XIV century BC. This treaty exempts Cypriot traders from customs duty in exchange
for the importation of a certain quantity of copper and wood. Nothing has
fundamentally changed since: at the beginning of the XXI century AD we still have
bilateral trade agreements. But they now have to be notified to

the WTO where they are checked for consistency with international trade rules.

The international legal order, on the other hand, has evolved dramatically. The great
empires

have disappeared into history. Philippe le Bel and Jean Bodin’s jurists progressively
conceptualized the

notion of sovereignty, the treaties of Westphalia ushered in the pre-eminence of a

society of sovereign

States, the Congress of Vienna of 1815 laid the foundations of multilateralism, and
the XIX century

invented the first international organizations. With the creation of the League of
Nations followed by the

United Nations system, and finally, with the disintegration of the Eastern Bloc, the XX
century saw the

evolution of traditional international law between States towards a contemporary and

universal international law open to new players such as the international
organizations and the non-governmental organizations.

Thus, the international legal order has gone through a number of upheavals. But its
evolution

has been neither linear nor homogenous - which is why international society still
bears the marks of

several historical stages of the process.

A UNIQUE LEGAL SYSTEM WITHIN THE INTERNATIONAL LEGAL ORDER

The WTO is an international organization. This may seem obvious, and yet it took over 50
years to achieve that result. This protracted effort to acquire a legal existence has left its
marks.

The GATT, which was replaced by the WTO in 1994, was a provisional agreement that
entered into force in January 1948 and was to disappear with the treaty creating the
International Trade

Organization. Since that treaty never entered into force, the GATT remained, for a half a
century, an

agreement in simplified form which, in principle, did not provide for any institutional
continuity. Thus, the

GATT did not have “Members” but “contracting parties”, a term which highlighted the purely
contractual nature of the arrangement. Without any international organization in the strict
sense of the term, and

therefore without a separate international legal personality, the GATT could only operate
through its

CONTRACTING PARTIES and, for its every day work, with the support of the Interim
Commission

for the International Trade Organization (ICITO), a provisional commission responsible for
setting up

the ITO.

Thus, it was almost 50 years later, with the Marrakesh Agreement, that a true international

organization was finally created, i.e., according to the definition supplied by the International
Law

Commission in its draft articles on the responsibility of international organizations, “an

organization

established by a treaty or other instrument governed by international law and possessing its
own international legal personality”. In order to avoid any ambiguity, the Agreement
Establishing the WTO states

in Article VIII that the Organization shall have legal personality.

The implications of this status are numerous. The Marrakesh Agreement states that Members

shall accord the WTO such privileges and immunities as are necessary for the exercise of its
functions.

Thus, its legal personality consists of an international facet, which enables it to act at the
international

level, and an internal personality, which enables it to conclude contracts for the purposes of its
day-today operations and among other things to employ its six hundred permanent staff
members. As with all
international organizations, the competencies of the WTO are limited by the principle of
speciality. But

alongside its subject-matter competence, which is explicitly provided for in its constituent
instrument,

the WTO also has implicit competencies. Thus, the main consequence of this status of
international

organization is that it enables the WTO to have its own will which is expressed in a legislative
output

within the limits fixed by its constituent instrument, and to interact with other international
players.

As a true international organization, the WTO now comprises an integrated and distinctive
legal

order: (1)it produces a body of legal rules (2) making up a system and (3)governing a
community .

(1) A body of legal rules, first of all. The WTO is a treaty comprising some 500 pages of text
accompanied by more than 2,000 pages of schedules of commitments. Moreover, 50 years
worth of

GATT practice and decisions — what we call the “GATT acquis” — have been incorporated
in

what constitutes the new WTO treaty. WTO rules are regularly renegotiated. While it is true
that

the WTO Secretariat and the WTO bodies do not have any general power to adopt formally
binding rules, the WTO bodies are able to adopt effective decisions that provide pragmatic
responses to specific needs, and in that sense, they do produce a kind of secondary legislation.
The

system is no longer based solely on the principles of a certain diplomacy which often led,
under

the GATT, to the adoption of negotiated solutions that reflected the relative power of the
States

involved. The WTO does not produce equity, in the meaning given to the term by public
international law — rather, it produces legality.

(2) Secondly, these legal rules form an integrated system. Indeed, the WTO agreements are
integrated in a “single undertaking” which forms an entity that is meant to be coherent. A
number of

provisions recall this fact, and in particular Article II:2, which states that the multilateral trade
agreements “are integral parts” of the Agreement Establishing the WTO and are “binding on
all

Members”. This is why they appear in annex to the Agreement Establishing the WTO. In the

Indonesia — Autos dispute, the panel which ruled in the first instance recalled that there was
a

presumption against conflict between the different provisions of the WTO treaty since they
formed

part of agreements having different scopes of application or whose application took place in

different circumstances. On several occasions, the Dispute Settlement Body (DSB) reaffirmed

that Members must comply with all of the WTO provisions, which must be interpreted
harmoniously and applied cumulatively and simultaneously. Thus, the WTO treaty is in fact a
“single

agreement” which has established an “organized legal order”.

(3)Thirdly, WTO law governs a community, namely its Members. In United States — Section
301,

the Panel confirmed the existence of a GATT/WTO legal order and even seemed to suggest
that

this order was characterized by its “indirect impact on individuals”. For, by contrast, “when
an

actual violation takes place ... in a treaty the benefits of which depend in part on the activity
of

individual operators the legislation itself may be construed as a breach, since the mere
existence

of legislation could have an appreciable ‘chilling effect’ on the economic activities of

individuals.”

The qualification of nations no longer only as objects of WTO law, but also as subjects, is still

disputed. Leaving that debate aside, I would say that the WTO rules above all effectively
govern

the community of its Members, since failure to comply is punishable in the framework of the
DSB.

In other words, they do form a new legal order as defined above.

However, this integrated legal system is not “clinically isolated”: there is a presumption of
validity in international law and the rules of its treaties must therefore be read in harmony
with the principles
of international law. Thus, the WTO legal order respects, inter alia, the sovereign equality of
States,

good faith, international cooperation, and the obligation to settle disputes peacefully, not to
mention the

rules of interpretation of conventions which the Appellate Body, for example, applies without
hesitation.

The WTO respects general international law, while at the same time adapting it to the realities
of

international trade. In joining the international legal order, the WTO has ended up producing
its own

unique system of law.

Leaving aside the doctrinal debate on the autonomy of international economic law, it is clear

that WTO law is largely a circumstantial application of international law in general.

PRINCIPLES OF GENERAL INTERNATIONAL LAW

WTO law is a body of legal rules making up a system and governing a community. As

such, the WTO incorporates an integrated and distinctive legal order. Bringing together
traditional

international law, which it respects, and contemporary international law, which it is helping to
promote,

the WTO has become a part of the international legal order as a sui generis legal system. But
how does

WTO law link up to the legal systems of other international organizations within the
international legal

order?

“ THE LINK BETWEEN THE LEGAL SYSTEM OF THE WTO AND THE

LEGAL SYSTEMS OF OTHER INTERNATIONAL ORGANIZATIONS. ”

The effectiveness and legitimacy of the WTO depends on how it relates to norms of other
legal

systems and on the nature and quality of its relationships with other international
organizations. In order

to address more specifically the place and the role of the WTO’s legal system in the
international legal
order, I will briefly discuss how the WTO’s provisions operate and treat other legal norms,
including

norms developed by other international organizations. My focus will first address this issue
from a

normative point of view, and then from an institutional perspective. I will show that the WTO,
far from

being hegemonic as it is sometimes portrayed to be, recognizes its limited competence and the
specialization of other international organizations. In this sense the WTO participates in the
construction of

international coherence and reinforces the international legal order.

The WTO, its treaty provisions and their interpretation, confirms the absence of any hierarchy

between the WTO norms and those norms developed in other fora: WTO norms do not
supersede or

trump other international norms.

In fact the GATT, and now the WTO, recognizes explicitly that trade is not the only policy

consideration that Members can favour. The WTO contains various exception provisions
referring to

policy objectives other than trade, often under the responsibility of other international
organizations.

Our Appellate Body has managed to operationalize these exception provisions so as to

provide Members with the necessary policy space to ensure if they do wish that their actions
in various fora are

coherent.

The WTO is of course a “trade” organization; it comprises provisions that favour trade
opening

and discipline trade restrictions. The basic philosophy of the WTO is that trade opening
obligations are

good, and even necessary, to increase people’s standards of living and well-being. But at the
same time

the GATT, and now the WTO, contains provisions of “exceptions” to these market access
obligations.

The old — but still in force — Article XX of GATT provides that nothing prevents a Member
from
setting aside market access obligations when a Member decides, unilaterally, that
considerations other

than those of trade must prevail. This can happen when, for instance, a Member has made
commitments in other fora, say on an environmental issue, when such an environmental
commitment may lead

to market access restrictions.

The revolution brought about by WTO jurisprudence was to offer a new teleological
interpretation of the WTO that recognizes the place of trade in the overall scheme of
States’ actions and the

necessary balance that ought to be maintained between all such policies.

How is this done within the WTO legal order?

First, and very simply, the WTO treaty was considered and interpreted as a “treaty”.
In the

very first WTO dispute, an environment— related dispute (US — Gasoline) the
Appellate Body concluded that the Panel had overlooked a fundamental rule of treaty
interpretation, expressed in the

Vienna Convention on the Law of Treaties (the “Vienna Convention”). I am sure this
sounds very

obvious to you international legal experts! The Appellate Body first recalled that these
general rules on

treaty interpretation had attained the status of a rule of customary or general

international law. It was

important to do so because, as you may know, neither the USA nor the EC have
ratified the Vienna

Convention on Treaties. Then the Appellate Body made its first statement, now
famous, on the nature

of the relationship between the WTO and the international legal order: “the GATT is
not to be read in

clinical isolation from public international law.”

Recalling that pursuant to Article 31 of the Vienna Convention, terms of treaties are
to be given

“their ordinary meaning, in their context and in the light of the Treaty’s object and
purpose”, the Appellate Body noted that the Panel Report had failed to take adequate
account of the different words

actually used for each of the Article XX exceptions. This led to a reading that offered
much more
flexibility in the so-called environment exception and a categorical turn about in 50
years of GATT

jurisprudence.

In relying on the steps and principles of the Vienna Convention, panels as well as the
Appellate

Body has since often referred to the “context” of the WTO treaty and to non-WTO
norms when

relevant. I’ve been told that no other international dispute system is so attached to
the Vienna Convention! In my view, this insistence on the use of the Vienna
Convention on Treaties is a clear confirmation

that the WTO wants to see itself being as fully integrated into the international legal
order as possible.

The linkage between the WTO and other sets of international norms was also
reinforced when

the Appellate Body stated that in WTO, exception provisions — referring to such non-
trade concerns

(environment, morality, religion etc...) — are not to be interpreted narrowly:

exceptions should be

interpreted according to the ordinary meaning of the terms of such exceptions. In this
context, our

Appellate Body has insisted that exceptions cannot be interpreted and applied so
narrowly that they

have no relevant or effective application.

The Appellate Body further expanded the availability of WTO exceptions in the
following

manner. In WTO exceptions are subject to what we call a “necessity test”, a test
having features of a “proportionality” requirement. When assessing whether a
measure is “necessary” for any non-WTO

concern, a new and additional balancing test is to be used.

Such an assessment will have to balance first (1) the “value” protected by such
measure — and

the more important this “value”, the easier it will be to prove the necessity (and the
importance of the
value will affect the entire balancing process); second (2) the choice of the measure
chosen to implement such a non-trade concern — is it a complete or partial ban on
trade? is it a labeling requirement?

is it a discriminatory tax?; and finally a third element (3) the trade impact of the
restriction.

Once a measure prioritizing a non-trade value or standard is considered “necessary”,

there is

always an assessment as to whether the measure is indeed applied in a non-

protectionist manner,

pursuant to the chapeau of Article XX. Here again the Appellate Body has said that
when assessing

whether a measure complies with Article XX, a “balance” between WTO market
access obligations

and a government’s right to favour policies other than trade must always be kept.

Our jurisprudence has determined that the “control” exercised by the chapeau of
Article XX of

GATT, against disguised protectionist measures, is in fact an expression of the “good

faith” general

principle or an expression of the principle against the “abuse de droit”. I quote “the
task of interpreting

and applying the chapeau is, hence, essentially the delicate one of locating and
marking out a line of

equilibrium between the right of a Member to invoke an exception ... and the rights of
the other Members under varying substantive provisions .The location of the line of
equilibrium, is not fixed and unchanging; the line moves as the kind and the shape of
the measures at stake vary and as the facts making

up specific cases differ.”

WTO provisions themselves recognize the existence of non-WTO norms and other
legal orders and attempts to limit the scope of application of its own provisions,
thereby nourishing sustainable

coherence within the international legal order.

Another fundamental principle of the WTO is that Members can set national
standards at the

level they wish, so long as such Members are consistent and coherent. For example,
in the dispute
between Canada and the European Communities over the importation of asbestos-
related material, the

Appellate Body stated clearly that France was entitled to maintain its ban since it was
based on authentic health risks and standards recognized in other fora and no
alternative measures could guarantee zero

risk as required by the EC regulation.

An additional feature of the WTO that confirms its integration into the international
legal order,

is the legal value and status it provides to international standards and norms
developed in other fora.

For instance, the Sanitary and Phytosanitary (SPS) Agreement states that Members’
measures based

on standards developed in Codex Alimentarius, the International Office of Epizootics

and the International Plant Protection Convention are presumed to be compatible
with the WTO. So, while Codex,

and others do not by any means legislate in the normal or full sense, the norms that
they produce have

a certain authority in creating a presumption of WTO compatibility when such

international standards are respected. The SPS Agreement provisions thus provide
important incentives for States to base

their national standards on, or conform their national standards to, international
standards. Therefore

the WTO encourages Members to negotiate norms in other international fora which
they will then

implement coherently in the context of the WTO.

The WTO does, take into account other norms of international law. Absent
protectionism, a

WTO restriction based on non-WTO norms, will trump WTO norms on market
access. In so doing, it

expands coherence between systems of norms or legal order. Moreover, I believe

that in leaving Members with the necessary policy space to favour non-WTO
concerns, the WTO also recognizes the

specialization, expertise and importance of other international organizations. In sum,

the WTO is well

aware of the existence of other systems of norms and that it is not acting alone in the
international
sphere.

Existing relations between the WTO and other international organizations again
reflect efforts

of coherence within the international legal order. Now that the WTO is an authentic
international organization will full legal personality, it has set up an important network
of formal and de facto arrangements with other actors on the international scene. The
greater the coherence within the international

legal order, the stronger the international “community”.

The actual interactions between the WTO and other international organizations.
There are, for

example, explicit WTO provisions on IMF/World Bank/WTO coherence with an

explicit mandate to

the Director General. There exists a series of inter-agency cooperation on technical

assistance and

capacity building with several international organizations. Indeed the current Round
of negotiation is to

some extent premised on coherence, as we are suggesting a new “Aid-for-Trade

programme” which

brings together several multilateral organizations and regional development banks to

assist developing

countries in reaping the benefits of trade opening!

The formal cooperation agreements with other international organizations. For

example, in the

area of standards setting, now have a mechanism — The Standards and Trade
Development Facility

— involving the WTO, World Bank, Food and Agriculture Organization (FAO), World
Health Organization and the World Organization for Animal Health. Some 75
international organizations have obtained regular or ad hoc observer status in WTO
bodies. The WTO also participates as an observer in

many international organizations. Although the extent of such cooperation varies,

coordination and

coherence between the work of the WTO and that of other international organizations
continue to

evolve in a pragmatic manner. The WTO Secretariat maintains working relations with
almost 200
international organizations in activities ranging from statistics, research, standard-
setting, and technical

assistance and training.

The WTO’s mantra in favour of trade openness plays a vital role in Members’ growth
and development, but it’s not a panacea for all the challenges of development,
neither is it necessarily easy

to accomplish, nor in many circumstances can it be effective unless it is embedded in

a supportive

economic, social and political context and a coherent multi-faceted policy framework.
Trade opening

can only be politically and economically sustainable if it is complemented by policies

which address, at

the same time, capacity problems (whether human, bureaucratic or structural); the
challenges of distribution of the benefits created by freer trade; the need for
sustainable environment; the respect of public

morals, etc. This is also about international legal coherence.

All these policies are intertwined with the other treaty obligations of WTO Members.
So further international coherence will only assist in getting the best out of the WTO!
Since WTO norms are

not hierarchically superior or inferior to any other norms (except jus cogens) States
must find ways to

coordinate all these policies in a coherent manner. I believe that the WTO favours
and encourages such

coherence.

If the WTO, through its dispute settlement system, can show that it does take into
account the

norms of other legal orders, many still challenge the fact that it will be for the WTO
judge to determine

the balance, the “line of equilibrium” between trade norms and norms of other legal
orders. Indeed, at

present, if a measure has an impact on trade, the matter can always be taken to the
WTO dispute

settlement system fairly simply and quickly. The WTO adjudicating body will then
have to determine

whether the trade restriction can find justification in the exception provisions of the
WTO. In assessing
the invocation of such WTO exception justification, the WTO judge may in fact be
deciding on the

relative hierarchical value between two sets of norms.

Indeed, if a WTO Member invokes the environment exception to justify a trade

restriction

adopted pursuant to a multilateral environment agreement (MEA), in practice, it is the

WTO judge who

will determine whether, and the extent to which, compliance with such an MEA can
provide a WTO

justification for trade restriction. If, in support of its invocation of the WTO exception
for public morals,

a Member points to an International Labor Organization (ILO) resolution condemning

a specific State

for violation of core labour standards, it is the WTO judge who will end up deciding on
the legal value

and impact of such an ILO resolution on international trade and its opposability to
trade rules.

COUNTRY OF ORIGIN

Country of origin is the country of manufacture, production, or growth where an

article or

product comes from. From a marketing perspective, country of origin gives a way to
differentiate the

product from the competitors. It is believed that the country of origin has an impact on
the willingness to

buy a product, and studies have shown that consumers may tend to have a relative
preference to

products from their own country) or may tend to have a relative preference for or
aversion to certain

products that originate from certain countries.

Home Country Control (also Country of Origin rule) is the rule of EU law, specifically
of Single

Market law, that determines which laws will apply to goods or services that cross the
border of Member States. EU law requires that the goods or services produced
legally in one Member States should
be allowed unhindered access to markets of other Member States. The latter are not
allowed applying

their laws except in specific circumstances. When they are allowed to do so, this will
be under a

specifically developed test called General Good Test.

The provision underlying the four feedoms (and therefore also the Home Country
Control) is

the prohibition of discrimination based on nationality: Article 12(ex 6) of the EC

Treaty. Over the

course of years, however, non-discriminatory behaviour also became prohibited, in

as much as it created obstacles to trade between Member States. In the sphere of
goods, what these “non-discriminatory” obstacles were and how they were to be
removed was clarified in Cassis (C-120/78, [1979]

ECR 649) and Keck (Joined Cases C-267 and 268/91, 1993 [ECR] I-6097) cases of
the Court of

Justice. In services, this was done in Säger (C-76/90, [1991] ECR I-4221), and in
establishment in

Gebhard (C-55/94, [1995] ECR I-4165). The power of these cases lies in making the
products and

services legally made in one state (Home State) available in other state (Host State),
where the latter is

only exceptionally able to apply its law to the said good or service. In other words,
once a good or a

service gains a “passport” in its Home State, it can be freely exported into any other
Member State.

2. Strategic Management
Describe the key issues which a management address to achieve successful,
substantial and lasting changes in an organisation.
Ans)
The bases for success or failure in implementation are subtle and numerous. These
include

the ten flaws in the planning process discussed earlier along with the extent to which
the plan itself is

soundly conceived. Additional contributing factors to implementation success stem

from the fact that

almost every strategic plan calls for major changes in how organizations work. The
successful

achievement of these changes requires durable and far-reaching changes both in

how the organization

works as a total system and how individual departments and people behave in that
system.

REQUIRED CHANGES IN THE EXISTING OPERATING SYSTEM

Consider first the demands made on an organization by a typical strategic plan. Most
strategies

are aimed to improve business performance: faster growth, more share of market,
better returns, higher

profits, etc. Typically such strategies call for the organization to operate differently,
which mean the

organization as a whole, each of its component departments and the people in each
department. For

example, one strategy may require new products and services that better meet
customers’ needs.

Brought to market in half the customary time. Another strategy aimed at improving
customer

satisfaction requires substantial improvements in the quality of market offerings. A

third strategy may

press for more aggressive pricing, enabled by greatly reduced costs.

Successful implementation of such strategies often requires fundamental changes in

the

behaviour of the existing organization or its Operating system. This includes all the
functions, people,

technology, workflows, policies and procedures and institutional systems (eg.

planning, information
(including performance measures), control, rewards, communications) and the way
these interact to

carry on an existing business. Each operating system has its own culture and
performance capabilities

(strong and weak), including an inherent ability to resist change.

One element in any operating system is exceptionally powerful in perpetuating

established

behavioral norms. This element is the set of performance measures institutionalized

at function or

departmental level. These measures provide the day-to-day indices by which each
department’s

managers and employees both determine the objectives and priorities for allocating
personal time and

effort, and assess the adequacy of both individual and departmental performance.

As with any living organism the elements of any operating system interrelate in
extraordinarily

complex and subtle ways. It is difficult to anticipate accurately how any changes required by a
business

strategy will impact the operating system (e.g. changed functional roles, orientations,
responsibilities

and actions, changes in how functions must interact, changed priorities, new technology, etc.).
Only

extraordinary managerial effort informed by an understanding of what drives successful

implementation

will achieve the desired changes.

ACTION STEPS

In a well-conceived strategic or operating plan the changes required of an operating system

to implement a particular strategy are outlined in the form of a sequence of action steps. Each
action

step specifies the scope of work to be done, the nature of the ‘deliverable’ when the work has
been

completed, the resources required including the key individuals who will be working on the
task, the
person accountable for meeting the commitment, and the date of completion. Implementation
of an

action programme (and by implication, the strategy) is monitored and measured by relating
actual

progress against the completion of the tasks in the action programme.

But completing an action programme does not necessarily mean that the strategy has been

successfully implemented. Achieving an action usually marks only the start of a change in the
operating

system. Fully realizing the intent of that change by making it operational over a sustained
period of

time is another matter.

CHANGES IN PERSONAL BEHAVIOUR

At the level of individual manager, supervisor and employee, successful strategy

implementation often requires durable changes in personal behaviour. These changes typically
require

each individual to replace familiar, well-established activities with modified or new ones.
Often, new

skills must be learned. The impetuses for such changes in behaviour are altered priorities and
the

need to develop and sustain focus on a few key issues and tasks.

DEPARTMENTAL MEASURES

Typically, departmental measures tend to reflect the manager’s view of what constitutes

excellent performance. Unfortunately, this may or may not be relevant to what constitutes
excellent

performance in the entire system because a department is only a Mimic component of that
system.

For example, cutting costs in one department may create more costs in another department.

In most organizations any department may have to respond to a variety of measures instituted

by such functions as Finance, Materials, Quality and Human Resources. These measures are
typically
developed and administered in isolation of one another. Thus, a department manager might
have to deal with a quality report one day a report on costs for Finance the next day and
an output report

every day. Because such measures are often applied individually in isolation of the others,
there is no

integration or balance among them to reflect strategic and operational priorities at

departmental level.

A collection of such functionally driven measures is more likely to undermine rather than help
successful

strategy implementation by the operating system.

KEY ISSUES OF MANAGEMENT

The more effectively a management addresses five key issues, the more successful it will be

in achieving substantial and lasting changes in how the whole organization and its operating
systems

work.

1. How thoroughly does everyone affected by or involved in carrying out the strategy

understand:

• The needs of their customers?

• What is to be achieved, and why?

• How is the strategy to he accomplished, and to what timetable?

• What resources will be applied? And

• What specific changes in behaviour are required of each person involved?

2. How strong is the commitment (initial and ongoing, of relevant managers and employees

to implementing the strategy successfully?

• How credible do they find the objectives and strategy?

• To what extent do they ‘own’ the objectives and strategy?

• To what extent have they participated directly in analyzing options and formulating the
strategy?

• How can commitment be sustained throughout the implementation period?

3. How completely have the resources required to implement the strategy been identified

and provided (including funds, tools, skills and time)?

4. How systematic a process has been instituted for tracking implementation progress and

for making mid-course corrections?

• What gains are projected and how will these be measured, monitored and communicated?

• How will actual experience be matched against forecasted results and how will timely
revisions

be made in the implementation plan to reflect developing experience?

5. How consistent and credible a climate of accountability is maintained throughout the

implementation period?

• How clearly do those who have made commitments believe they must make good on their

promises?

• What are the consequences when groups and individuals succeed or tail; how congruent are

rewards with success and failure?

• How visible and consistent is leadership behaviour?

If management is to address these five key issues effectively, it must begin doing so at the

very outset of the planning process both in developing the business strategy, and immediately
following

in formulating more detailed operating plans.

3. Business English
Explain the factors responsible for a speech situation for the existence of
communication.
Ans)
English is perhaps the most widely used language in business communication.
Before we

move on to the use of English in business let us understand what communication is.
It is a process by

which meaning or thoughts are exchanged between individuals through a mutually

understood language

or symbol. It is a bridge of understanding among people.

THE DEFINITIONS OF COMMUNICATION

The scholars who define communication give stress on the transmission and
reception of

information. The concept of communication is broad enough to mean almost anything

to almost

anybody. As it is the binding agent of all social systems and sub-systems, it is

understood and used in different ways by the people in different walks of life. Therefore, it
was essential to study how this

concept is understood by them and later to arrive at a comprehensive definition in precise

terms. Let

us consider some definitions of communication.

i. “Communication is the process of transmitting feelings, attitudes, facts, beliefs and ideas

between living beings”. — Birvenu (1987)

ii. “Communication is any means by which thought is transferred from one person to
another”.—

Chappcll and Read (1979)

iii. “Communication is an exchange of facts, ideas, opinions or emotions by two or more

persons”.— Newman and Summer (1977)

iv. “Communication is process for conducting the attention of another person for the purpose
of

replicating memories.” — Cartier and Harwood (1977)

v. “Communication is a process which involves the transmission and accurate replication of
ideas

ensured by feedback for the purpose of eliciting actions which will accomplish organizational

goals- William Scott (1977)

vi. “Communication is the process by which information is transmitted between individuals

and/

or organizations so that an understanding response results - — Peter Little (1977)

vii. “Communication is a continuing and thinking process dealing with the transmission and

interchange with understanding of ideas, facts and courses of action”. — Terry and Franklin

1984)

We are now in a position to define the concept of communication in the following words:

“Communication can be defined as an exchange and exact replication of thoughts, feelings,

facts, beliefs and ideas between and among the individuals through a common system of
symbols to

cause some actions or changes in behaviour.” (Rodriques, 1992)

Communication Situation

All communication is possible only in a speech situation. A speech situation is

communication

situation. This speech situation requires certain factors for its existence. The factors are (1)
Participants,

(2) Contact, (3) Context, (4) Common Code. (5) Form of Message, (6) Goal of
Communication.

1. Participants

There are always two parties in a communication situation: the sender and the receiver. The

sender sends the message to the receiver and the receiver interprets the message and acts
accordingly.

The communication is a goal-oriented activity. The sender has some goal or intention towards
the receiver: persuading the receiver, making him to do something or believe something etc.
The receiver

must respond to make it clear that he has received the message. There are different ways of
doing
this. What the receiver does to indicate that he has received the message is called ‘feedback’.
This

feedback may be verbal or non- verbal. Unless the sender receives the feedback in some form,
the

communication process remains incomplete.

The sender is both the sender of the message and the receiver of the feedback. And the

receiver is both the receiver of the message and the sender of the feedback.

The sender and the receiver are not necessarily present at the same time and place. If the

communication is through written media, generally the sender and the receiver are distanced,
that is,

they are not present at the same time and place.

2. Contact

For successful communication contact must be established between the participants. The

sender must make the receiver to give attention to his message. In order to attract attention he
uses

short calls (Vocatives etc.) like ‘dear’, ‘hey’, ‘John-, ‘Sir’ etc. The contact is later maintained
by

physical testing of the channel. The sender asks the receiver ‘Can you hear me?’ ‘Do you
follow

me?- etc. The sender must also establish rapport with the receiver. The sender sometimes does
it by

talking about the weather, health praise, encouragement etc. These are the small talks, but
they matter

in communication. The contact is established not only physically but also psychologically by
asking

questions like -Do you get me?’ The sender also uses many linguistic techniques to maintain
the contact

and for helping the receiver by using the linguistic expressions like ‘My next point is......
‘First of all

...’, ‘Secondly ....’, Thirdly …’. These are explanatory techniques, establishing and
maintaining contact
between the sender and the receiver is very crucial as it accelerates the process of
communication.

3. Context

Communication cannot take place in a vacuum. It requires a physical and temporal setting.

In other words, it takes place at a particular place and time. However, the topic of
communication is

more important in communication situation. It is the background knowledge which is shared

between

the sender and the receiver. It helps the receiver to interpret the message. It helps the receiver
to

predict what the sender is going to say. This prediction is very important in understanding the
message.

Besides, it is also important in planning the message that the sender sends to the receiver.
Thus the

setting and the topic form the context of communication

4. Common Code

A code is a set of conventions used for communication. Both the sender and the
receiver

must be in possession of some common code. The code must be shared by both the
participants.

This common code may be linguistic, paralinguistic or non-verbal.

5. Form of Message

The message which is transmitted from the sender to the receiver must have the
same form.

This form depends upon the situation. If the setting of the situation is noisy the form
is loud. If the

setting is short-timed, the form is brief. The form may also be formal or informal,
polite or impolite.

The form depends upon the roles of the participants and the goal of communication.
There are a

number of ways to send the same message.

6. Goal of Communication
Communication is a goal-oriented activity. Communication must have some goal. In
fact the

goals are not the same everywhere. The goal changes according to the focus of
communication. It is

in fact the function of the language used in communication. The goal may be
speaker-oriented. It is

the personal function of language. Here, the language is used to express the
speaker’s attitudes,

personality and emotions. It is used to indicate whether the speaker is sad, happy,
angry, upset,

dissatisfied etc. The goal may be receiver-oriented. It is the directive function of the
language. It is

aimed at controlling the behaviour of the hearer by influencing, persuading etc.

Commands, requests,

warnings and other functions like these are hearer-oriented. The goal may be contact
oriented. Here,

the language carries out the function of establishing contact. This is also called
phonic function of

language. The language is used to establish and maintain relations and to promote
the feelings of

goodwill. There are also set formal or ritualistic linguistic expressions to carry out this
function like

‘bye bye’, ‘hello’. In order to establish contact, there are certain formal or ritual
activities like greeting,

leave-taking, talking about weather and health or making inquiries. This phonic
function is also carried

out by using gestures and facial expressions.

The goal may be topic-oriented. This is referential function of language. Here, the
language

is used for expressing thought -content by making statements for putting forth
propositions.

The goal may be code-oriented. This is met linguistic function of language. Hence,
the

reference is to some set of rules and conventions. Its aim is to test mutual under-
standing of the rules
and conventions.

Finally, the goal may be message-oriented. This is the imaginative function of

language. The

sound, rhythm and tune are used in such a way as to give pleasure to the hearer and
help comprehension. Even in written communication this goal may be achieved by
using different graphics.

This is also called aesthetic function of language. The process of communication

takes place in the

communication situation.

4. Management Information System

What are the different approaches used to explain the composition of MIS?
Explain?
Ans)
The subject of management information system has inspired and evoked emotions as
wide

as spectrum of light. It adds in the understanding of MIS concept and is greatly useful
to Organisations in designing or redesigning of their information system.

Information management is the collection and management of information from one

or more

sources and distribution to one or more audiences who have a stake in that
information or a right to that

information. Management here means the organization of and control over the
structure, processing

and delivery of information. Information Management (IM) is characterized by the

phrase ‘Getting the

right information to the right person at the right place at the right time’. It does not,
however, address the

question of what constitutes the ‘right information’. This omission can be addressed
through the philosophy

of Informational management (IaM). IaM is characterized by the phrase, ‘Knowing

what information

to gather, knowing what to do with information when you get it, knowing what
information to pass on,
and knowing how to value the result.’ This identifies the ‘right information’ and the
resulting whole

solution is worth more than the sum of its parts.

Composition of MIS – Different approaches

MIS is a system where Manager could access detailed piece of information

instantaneously.

For example, it also explains annexures and appendages of accounting system and
financial summary statements.

The basic composition of MIS can be explained in terms of different approaches:

1) Physical components

2) Information system functions

3) Decision support

4) Management hierarchy

5) Organisational functions.

MIS can be defined as an integrated man-machine system that provides information to

support

planning and control function of Managers in the Organisation.

MIS reveals clear planning targets to control operations and information of

performances.

The major purpose of MIS could be generalized as to sub-serve managerial functions,

routine

collection of information, support and review planning control decisions.

The five approaches mentioned above are explained in detail below

1. Physical components

Physical components of MIS can be explained to a person interested in understanding

structure

of MIS in the organisation. The physical components are;

Hardware Refers to physical computer equipment and associated devices such

as CPU, monitor, keyboard, printer, discs, tapes and CD’s.

Software It is a broad word assigned to the instructions that direct the

operations of the hardware. This can be further classified as a system

software and application software.

Data Base This consists of all data used by the application software and stored

in files.

Procedure Regular operating procedures like manuals also form a part of physical

structure.

Operating Personnel like computer operator programmer, system analyst, System

Technician Manager are users of information system.

MIS helps to assess internal sources, market research, government rules, publications,

advertisements, external data and special analysis of information needed.

2. Information system functions

The information system could be explained in terms of its processing functions.

i) Transaction: Information system process transactions. Transaction may be defined

as an

activity taking place in the Organisation. It may be internal or external. For example -
purchase

or sale of a product in an Organisation.

ii) To produce reports: Many reports are produced on a regular basis which are termed
as

schedule reports. It may be adhoc or special reports.

iii) To process inquiries: Data base information system is utilized for processing
inquiry. They

may be regular with a pre-defined format or adhoc inquiries.

iv) To process interactive support applications: Various types of models are used for

processing applications designed to support planning, analysis and decision making.

The mode

of operation is interactive with the user responding to questions and requests for data
yielding

immediate results.

v) To maintain master files: Information system is used to create and maintain master
files of

an organisation. For example :

a) processing of pay slips,

b) wages,

c) employee’s rate of pay,

d) deduction etc.

3. Decision support

The basic structure of the MIS can be differentiated on the basis of its support in
decision

making in an Organisation. The decision can be highly structured or unstructured. A

structured decision

is programmable and they are routine in nature. The information system support will
differ for two

types of decision and so also information system. Some decisions will fit easily into
this classification,

but some decisions are more or less structured and have some elements that are
programmable and

some that are not, such decisions are called semi-structured decisions.

4. Management Hierarchy

MIS supports management activities in terms of hierarchy and they can be classified

into three levels : (a) strategic planning level

(b) management control level

(c) operation control level

a) Strategic planning deals with long term considerations such as choice of business,
market

strategy, product mix, etc.

b) Management control level has a medium term planning horizon including

acquisition and

organisation of funds, programming work schedule, training personnel etc.

c) Operational control is generally short-term decisions. Immediate operations like

production

level pricing, inventory are as a result of operational control.

Therefore, information system will be different for all the three levels of management
hierarchy

even though the management activities and information processing for the 3 levels are
inter-related.

Eg: Inventory control functions at all levels.

5. Organisational functions

MIS is essentially a federation of information systems that are designed to support the
functions

of sub-system of an organisation.

There is no set classification of functions but a designed group of functions are

necessary in

any manufacturing organisation which include production, sales, finance and

accounting, materials,

personnel, marketing and information systems. Each of the above function has unique
information needs

and requires specific information support.

MIS development approaches

MIS development is construed as a process involving various phases. A clear
understanding

of these approaches would be necessary to make a proper selection for development

of MIS and to

ensure proper implementation and running of systems. The following models are used
for MIS development:

I.System development life cycle (SDLC)

II.Prototyping

I SDLC APPROACH

In this approach, a system is visualized as a living organism with different phases of

life such

as birth, growth, maturity and death. The following are the phases of it.

1.Investigation

2.Analysis

3.Design

4.Construction

5.Implementation and

6.Maintenance

1. System investigation

This consists of two sub-stages :

i) Problem definition

ii) Feasibility study (Organisation, Economic, Operation)

i) Problem definition

It is always essential that problem to be solved should be clearly defined for the
system

development. System analyst should prepare a written statement of the objectives and
scope of the
problem based on interview with the Management and the end users. System analyst
should also

provide rough estimate of the costs involved for the system development.

ii) Feasibility studies

Feasibility report can be considered as high level capsule version of entire process,
trying to

answer number of questions about the problem. The report should be brief and crisp
to the objectives

with sense of scope and should be presented to the user and Management. Feasibility
study report

represents an excellent model of the system analyst’s understanding of the problem to

provide a clear

sense of direction for the future development of the system. The main objectives of
feasibility studies

is to evaluate alternative systems and to propose most desirable method for

development. The four

major categories, to which the feasibility of a proposed system can be evaluated are
given below :

a) Economic feasibility: To identify and understand expected rise in returns, reduction

in costs,

lowering required investment and other benefits over the costs of developing and
operating

proposed system.

b) Technical feasibility: Whether exact and reliable hardware and software capable of
meeting

the needs of the proposed system can be developed in time.

c) Organisational feasibility: This report deals with how good the proposed
information

system will support the organisation to implement strategic plans for information
system.
d) Operational feasibility: The attitudes of the management, employees, customer,
suppliers

and so on towards the proposed system.

2. System analysis

The system analysis involves detailed examination of :

The information needs of the organisation and its end-users.

Existing information system (activities, resources, and products).

Expected information system.

3. System design

System design specifies how the system will meet the objectives, set. The system
design

should stress on the following activities such as user interface, data and process
design.

4. Construction and testing

The system is developed according to the specification to a physical form. The

required

programme are coded, debugged and documented. The system is tested with some old
or new data

to test its ability to cope up with the objective of system change.

5. Implementation

The system implementation stage involves hardware and software acquisition, site
preparation,

user training and installation of the system.

6. Maintenance

System should be maintained and updated to make desirable improvements.

II. PROTOTYPING
Prototyping approach is easy and convenient compared to SDLC since it is
comprehensive

and does not include all the requirements of the user. The process of prototyping
includes:

1. Identifying the user’s basic information requirements

2. Developing the initial prototype system

3. Use of prototype system to refine the users requirement and

4. Revise and enhance the prototype system.

Generally the user is requested to use the system and suggest required modifications
to

improve the system. The feed back, which is the basis for designing the system, is
made use of to

prepare specification documents.343434

The processes involved are described below:

1. Identification of the user’s basic information requirements

In this case user identifies basic requirement in terms of output from the system. The
designer

should establish realistic user expectations and calculate the costs for the development
of prototype.

2. Development of the initial prototype system

In this step functional interactive application system is developed that, is required by

the

user. The prototype is developed using high level language. More emphasis is laid in
the speed rather

than efficiency of operations.

3. Use of prototype system to refine the user’s requirements

This facilitates the user to get the experience with the system and to understand what
it does

and does not perform. The user decides the changes necessary to have a control on
development
time.

4. Revise and enhance the prototype system

In this step designer makes required changes using basic principle. The emphasis is on
speed

to complete the modification and return to the user.

Prototyping approach is highly suitable for the large organizations with multiplicity
and

complexity of the operations involved. Prototyping methodology has significant

advantages in

development of applications having high uncertainty as to requirements:

1. Ability to ‘try out’ ideas without incurring huge costs.

2. Low cost for development where requirements change frequently.

3. The ability to get a functioning systems into the hands of the user quickly.

MIS in today’s world of ever increasing complexities of business and management

become

essential to survive and grow. MIS supplies accurate, relevant and timely information
to the Management

of the Organisation. If the MIS is poorly developed, designed and implemented,

becomes irrelevant

or obsolete to improve an Organisation.