National Conference On Current Issues And OppOrtunities In Global Emerging

Bussiness Scenario (ISBN 978-93-5258-981-4)

HR121
Recruitment and Selection Hiring Process: A Comparative
Study of Indian Companies and MNCs
*Ms. Nancy Arora, **Ms. Harwinderkaur
*Doctoral Research Scholar, Department of Business Administration, CDLU, Sirsa
**Research Scholar (M.Phil), Department of Business Administration, CDLU, Sirsa
*[email protected],**[email protected]
Abstract

Today the biggest challenge for any organization is to attract right kind of people and to
retain them for a longer period of time. The cost of wrong hiring is too high and has
multiple implications on the organization. Recruitment and selection hiring process is
designed to enable the managers to select creative, innovative people who have passion
and potential.The objectives of the recruitment and selection hiring process are to set
norms, measures and guidelines that will allow the organisation to select the number and
quality of employees with the necessary competencies, to satisfy the current and future
needs of the organisation. This Research Paper makes a modest attempt to examine the
variation in the recruitment and selection hiring process that is followed by managers of
Indian and MNCs.This article is divided in three parts. First part includes the introduction
and literature review. The second part discusses the data analysis which done by applying
t-test on data which is collected by survey. Third part concludes that the Indian
companies and MNCs would adopt same kind of selection procedure for their
organisation except few variables such as interviews, skill ability test and prefers fresh
graduates at entry level.

Key words: Indian Companies, MNCs, Recruitment and Selection Hiring Process.

INTRODUCTION

In order to increase efficiency in hiring and retention and to ensure consistency and
compliance in the recruitment and selection process, it is recommended the following

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Bussiness Scenario (ISBN 978-93-5258-981-4)

steps be followed (also refer to Staff Recruitment and Selection Checklist). Details for
each step include the minimum recommended best practice to attract a talented and
diverse applicant pool:
 Error! Bookmark not defined.
 Step 2: Develop Position Description
 Step 3: Develop Recritment Plan
 Step 4: Select Search Committee
 Step 5: Post Position and Implement Recruitment Plan
 Step 6: Review Applicants and Develop Short List
 Step 7: Conduct Interviews
 Step 8: Select Hire
 Step 9: Finalize Recruitment

Step 1: Identify Vacancy and Evaluate Need

Recruitments provide opportunities to departments such as aligning staff skill sets to

initiatives and goals and planning for departmental and individual growth. Although there
is work involved in the hiring process, proper planning and evaluation of the need will
lead to hiring the right person for the role and team.

Newly Created Position: When it is determined a new position is needed, it is important

to understand and take into consideration strategic goals for the University and/or
department. Conduct a Job Analysis if this position will be new to your department. This
will also help to identify gaps.

Replacement: As with a newly created position, it may be helpful to conduct a Job

Analysis in order to tailor the position to what is currently required and to ensure proper
classification. Your HR Classification Analyst can assist in reviewing and completing.
Step 2: Develop Position DescriptionA position description also referred to as a job
description is the core of a successful recruitment process. From the job description,
interview questions, interview evaluations and reference checks questions are developed.

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Bussiness Scenario (ISBN 978-93-5258-981-4)

Step 3: Develop Recruitment Plan

Each position requires a documented Recruitment Plan which is approved by the

organizational unit. A carefully structured recruitment plan maps out the strategy for
attracting and hiring the best qualified candidate and helps to ensure an applicant pool
which includes women and underrepresented groups including veterans and individuals
with disabilities.In addition to the position’s placement goals the plan contains
advertising channels to be used to achieve those goals. The recruitment plan is typically
developed by the hiring manager in conjunction with the Departmental HR Coordinator.
Placement goals identified are entered into the position requisition in the ATS.To ensure
the most current placement goals are identified for the department and unit, you may
contact the office of Faculty and Staff Affirmative Action. Recruitment Plan Elements:
A. Posting Period
B. Placement Goals
C. Additional Advertising Resources
D. Diversity Agencies
E. Resume Banks
Step 4: Select Search Committee: To ensure applicants selected for interview and final
consideration are evaluated by more than one individual to minimize the potential for
personal bias, a selection committee is formed. The hiring manager will identify members
who will have direct and indirect interaction with the applicant in the course of their job.
Each hiring manager should make an effort to appoint a search committee that represents
a diverse cross section of the staff. A member of the committee will be appointed as the
Affirmative Action and Compliance Liaison who will monitor the affirmative action
aspects of the search committee. Under-represented groups and women are to have equal
opportunity to serve on search committees and special efforts should be made to
encourage participation. Departments that lack diversity in their own staff should
consider appointing staff outside the department to search committees or develop other
alternatives to broaden the perspective of the committee.

Step 5: Post Position and Implement Recruitment Plan: Once the position description
has been completed then the requisition is created by the Service Center Human

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Bussiness Scenario (ISBN 978-93-5258-981-4)

Resources Coordinator or Departmental Human Resources Coordinator and approved by

the Service Center HR Organizational Coordinator or Organizational HR Coordinator.
Once approved, the Departmental HR Coordinator or Service Center will review the
requisition and route online to the HR Classification Analyst who will assign the
classification. The requisition is then routed to the HR Recruitment Analyst who will post
the position. Applications can be reviewed once the minimum number of posting days
has been reached. Internal candidates will apply through the regular application process
and will be included in the candidate pool along with external candidates.

Step 6: Review Applicants and Develop Short List: All applicants must be reviewed
and considered. Candidates who apply after the initial application period will be
considered qualified applicants prior to reviewing applicants who are expressions of
interest status. If it is determined the expressions of interests are to be reviewed, the
Search Committee Chair or Chair’s Associate may move those in the expression of
interest status to the applicant pool, in one or more batches on certain date(s) and time(s),
as needed to achieve a sufficiently diverse and qualified pool. All expressions of interest
candidates moved to the applicant pool are to be reviewed by the search committee.

Step 7: Conduct Interview:The interview is the single most important step in the
selection process. It is the opportunity for the employer and prospective employee to
learn more about each other and validate information provided by both. The Committee
Chair should determine the following:

 Format of the interview and order of questions

 Questions to be asked of all applicants
 Specific questions to be asked of individual applicants
 Who is going to ask which questions
 Determine if a work sample should be submitted
 The optimum start date for the position
 Any other details applicants may need about the role that were not noted in the
position description

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Bussiness Scenario (ISBN 978-93-5258-981-4)

Prior to the interviews being conducted, the Search Committee Chair will notify members
to download the application packets form iRecruit. The Search Committee Chair will
provide the committee with interviewee comparison tools to assist in the evaluation
process.

Step 8: Select Hire:Once the interviews have been completed, the committee will meet
to discuss the interviewees. Committee members will need to assess the extent to which
each one met their selection criteria.The search committee rating sheet will be helpful in
justifying decisions and making them as objective as possible.The most important thing
to remember is that you will need to be able to justify your decision. Documentation is
keyrequired to be in compliance. As one of the most critical steps in the process, it is
important to keep the following in mind:

 The best candidate for the position was chosen based on qualifications
 The candidate will help to carry out the University and Department’s
missions.

Step 9: Finalize Recruitment:Upon completion of the recruitment process the offer to

the selected finalist is made. The salary to be offered is to be equitable and lead to the
retention and motivation of employees.Prior to initiating the offer, it is recommended that
one more check of the selection process be completed as follows:

 Review the duties and responsibilities of the position and ensure they were
accurately described and reflected in the job description and interview process
 Review selection criteria used to ensure they were based on the qualifications
listed for the position
 Confirm interview questions clearly matched the selection criteria
 Confirm all applicants were treated uniformly in the recruitment, screening,
interviewing and final selection process.

REVIEW OF LITERATURE

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Bussiness Scenario (ISBN 978-93-5258-981-4)

Pissarides (2000)had examined thatthe hiring decision of a firm is made difficult and
costly for several reasons. Greater frictions in the labour market make it more difficult to
hire, so that the number of vacancies opened by firms is reduced. Moreover, in presence
of ex ante uncertainty about workers' ability and match quality, hiring firms are exposed
to the risk of a mismatch, which is more costly when the employment protection
legislation if stricter, as shown by a number of studies.

Kugler and Saint-Paul (2004) suggested that for the analysis of firing costs on hiring
and separating decisions. To circumvent this problem, firms can rely on a number of
solutions. They can use the curriculum of applicants, that is the current and previous
employment status, to get information about the applicants' ability.

Balter and Duncombe (2005) have provided a rich picture of the hiring process in New
York school districts. They have documented the use of a wide range of practices and
how they vary with school district characteristics. They have also developed a model to
explain the adoption of district recruitment practices. While some factors, such as
enrollment, appear to be consistently related to hiring practices, hiring practices are
complex and not easily explained by socio-economic variables. In this section, we will
pull together some of the conclusions that we have drawn from reviewing the results.
These should be viewed as preliminary conclusions, which will undoubtedly be modified
as we analyze the data further. Local newspapers remain the major form of advertising,
especially in small districts. The degree of institutionalization of advertising practices has
a significant impact on their use, especially when it comes to advertising beyond local
newspapers. The most common college recruitment strategies used by districts are
supervision of student teachers, posting of job notices at the colleges, and contacting
college faculty in local colleges. The employment of these strategies increases with
district enrollment and, unlike most practices we examined, is influenced by some district
stress effects.
Hofstede (2007) noted that to deal with the liability and competitive disadvantage that
stems from being latecomers lacking the resources and capabilities of established MNCs
from the most advanced countries. Furthermore, the degree and level of integration

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Bussiness Scenario (ISBN 978-93-5258-981-4)

between headquarters and subsidiaries will also influence the multinationals. Similarly,
with regard to internal influencing factors, the strategic framework of the MNC,
organizational culture, leadership, decision making and delegation of authority can be
considerably different in MNCs from emerging economies than their counterparts in
developed markets due to national cultural, economic and political differences.
Gautier (2012) illustrated that job search assistance helps the unemployed at finding job
offers, and monitoring helps at maintaining a certain level of search activity. As a result,
unemployed workers would send more applications, so firms would open more vacancies
and would be more likely to meet and hire unemployed workers. He indeed show that
increased counseling and job search assistance slightly increases the stock of vacancies.
Second, job search assistance may also help the beneficiaries at directing their
applications to offers which suit best their qualifications.

METHODOLOGICAL FRAMEWORK
Objective of the Study
To examine the variation in the recruitment and selection hiring process that is followed
by managers of Indian and MNCs.

Hypothesis of the Study

Based upon the objective of the study the following hypothesis is formulated for testing
and validation of results:
H00: There is no significant difference between the recruitment and selection hiring
process that are followed by managers of Indian and multinational companies.

Sample Size
There are 118 managers from different (HR & other) department of Indian and 100 HR &
other managers from MNC are selected. Total sample size 218 questionnaire.

Sampling Techniques
In present study non-probability sampling was collected. Only those respondents were
selected who seemed most likely to provide elicit information’s. Further, in non-

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Bussiness Scenario (ISBN 978-93-5258-981-4)

probability sampling, personal judgment of the researcher was main criterion of choosing
sample.
Data Collection
Data was collected from both the sources i.e. primary and secondary. For collecting
primary data the research has conducted consumer survey with the help of the pre-
determined questionnaire. Keeping in view the nature of this study, questionnaire method
was found to be the most effective. The questionnaire was structured i.e. it was preset
having form questions in sequence, and non disguised.

Data AnalysisTechniques
The collected data will be analyzed by using various statistical measures likemean,
standard deviation and t-test.

ANALYSIS OF RESULTS

Table 1: Independent Samples Test

In Table 1, we just choose out the variance which has the high level significance
difference. A significance difference show that both the companies are uses different
strategy for their company. This table shows that there is no significant difference
between the recruitment and selection hiring process of Indian companies and MNCs
except “fresh graduate at entry level” and “skill tests and interviews”.The both the
company used different approach. The Indian and MNC companies have a different
thought of action toward the selection of fresh graduate So there is significant difference
between Indian companies and MNCs in recruitment and selection hiring process of
employees in “fresh graduate at entry level” (p 0.009), “Written test” (p 0.000), “Test on
specific skills” (p 0.005), “Psychological test” (p 0.039), “Technical interview” (p
0.046), “General interview” (p 0.006). The Indian companies and MNCs would adopt
different kind of selection procedure for their organisation. The high level significance
difference shows the real factor about both the companies. As the p value of these
variables is less than 0.05 level of significance so null hypothesis H00 is rejected and in
case of other variables null hypothesis H00 is accepted.

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Bussiness Scenario (ISBN 978-93-5258-981-4)

Table 2: Group Statistics

Table 2 explains the recruitment and selection hiring process of Indian companies and
MNCs. The mean score of the hiring practicing of “fresh graduate at entry level” in
Indian companies(X= 0.0924) and MNCs (X=0.1098)is differ. Written test has more
impact in hiring process in MNCs than Indian companies. Their means score as follow
Indian companies (X=0.1014) and MNCs (X=0.1100).Similarly in “Test on specific
skills”, “Psychological test”, “Technical interview”, “General interview” have more
influenced the recruitment and selection hiring process of MNCs than Indian companies.
The average score of “Test on specific skills” in Indian Companies and MNCs are 0.1039
and 0.1139 respectively. The mean score of “Psychological test” in Indian companies
(X=0.1124) and in MNCs (X= 0.1141) differ with each others. In Technical interview
and general interview, the mean score of MNCs and Indian companies is significantly
different. The Null hypothesis (H00) is rejected for these variables (13 & 14).

CONCLUSION

In this article, the most relevant findings in the recruitment and selection hiring process is
the fact that management perception of procurement appears consistently to have a major
role in defining human resource management. Overall findings show that most of the
organization conducts the hiring practices at a significant level such as job analysis, job
description, job specification and selection. Organizations take the long term view at the
time of planning of human resources.Every organization conducts job analysis. The
adaptability of job analysis is more in MNC as compare to Indian companies.Job
specifications are designed according to the requirement of job. Human resources must
be planned regularly. Without human resources no organization cannot go ahead. The
adaptability of this factor is more in Indian companies than MNCs.Human resources are
planned for long term or for short term depends on company’s policies. MNCs are more
concerned about this factor.Best and competent people for jobs are asset for the
organization. Indian companies take this factor important. The adaptability of this
variable in MNCs is less than Indian companies.

REFERENCES

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Bussiness Scenario (ISBN 978-93-5258-981-4)

 Balter, D., & Duncombe, W. (2005). STAFFING CLASSROOMS: HOW DO

NEW YORK SCHOOL. American Education Finance Association 2005 Annual
Conference , 22- 37.

 Gautier P., M. M. (2012). Estimating equilibrium effects of job search assistance.

IZA Discussion Papers 6748, Institute for the Study of Labor, Bonn. , 34-49.

 Hofstede, G. (2007). Asian management in the 21st century. Asia Pacific Journal
of Management. 24(4): 411-420.

 Kugler A. & Saint-Paul G., 2004. How do Firing costs affect worker owes in a
world with adverse selection? Journal of Labor Economics 22 (3), 553-584.

 Pissarides C., 2000. Equilibrium unemployment theory. 2nd ed. MIT Press,
Cambridge

 BIBLIOGRAPHY \l 1033 (n.d.). Retrieved from

http://www.uleth.ca/diversityadvantage/documents/FacultyEquityHiringGuideOct
07final_web.pdf.

 (n.d.). Retrieved from http://www.usfa.fema.gov/pdf/efop/efo42481.pdf.

 (n.d.). Retrieved from http://www.writemypapers.org/examples-and-

samples/literature-review-graduate-recruitment-and-selection.html.

 (n.d.). Retrieved from

http://www.ccl.org/leadership/pdf/research/ExecutiveSelection.pdf.

 (n.d.). Retrieved from

http://www.learningpt.org/pdfs/HiringQualitySchoolLeaders_IssueBrief052009.p
df.

 (n.d.). Retrieved from

http://www.businessdictionary.com/definition/recruitment.html.

 (http://hr.ucr.edu/recruitment/guidelines/process.html).

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Bussiness Scenario (ISBN 978-93-5258-981-4)

HR122
Emerging Trends In HR Practices: Challenges And
Opportunities
Ms. Chitra
*Assistant Professor, Chandigarh University, Mohali
*[email protected]

Abstract

Challenge is always offset by opportunity. There are an incredible number of pressures

on today's organizations. Some of them are environmental pressures such as increasing
globalization, rapid technological change, and tougher competition; organizational
changes such as new organizational alliances, new structures and hierarchies, new ways
of assigning work, and a very high rate of change; changes in the workforce, including
employees' priorities, capabilities, and demographic characteristics. Within these
pressured organizations, there is a need as well as opportunity for the human resource
function to play a critical role in helping organizations navigate through these
transitions.The objective of the paper is to study the challenges faced by human resource
departments in the 21st century and strategies to meet such challenges. It also suggests
steps to improve the working of human resource departments.

Key Words: Human Resource Management, Challenges, Globalization, Retention,

creativity, HR strategy

Introduction

There is an enormous number of pressure on today's business like environmental

pressures such as increasing globalization, rapid engineering change, and hard-hitting
competition; organizational transform such as new organizational association, new
composition and chain of command, new ways of handing over work, and a very high
rate of transformation; changes in the labor force, including employees' main concern,

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Bussiness Scenario (ISBN 978-93-5258-981-4)

potential, and demographic characteristics. Due to these changes human resource

management is not it was before. Within these pressured organizations, now there is a
need as well as opportunity for the human resource function to play a critical role in
helping organizations to navigate through these transitions. In order to play this role,
however, HR will have to amplify its actual and apparent value.

The role of human resources has been evolving for some time. The shift from "personnel"
to "human resources," for example, was part of the movement to acknowledge the value
of employees as an organizational resource, and was an attempt to remove some of the
stigma that was coming to be associated with slow, bureaucratic personnel departments.
This shift in label was accompanied by a call for HR to become a strategic partner with
the leaders of the business-to contribute to significant business decisions, advice on
critical transitions, and develop the value of the employees-in short, to have a seat at the
table.

Literature Review

Dave Ulrich is the HR guru’s guru, credited with developing the “HR business partner”
model and other influential ideas in books including “HR Champions”. Dave Ulrich has
provided a clear path to the next generation of HR with Human Resource Champions:
The Next agenda for Adding Value and Delivering Results (1997). He described a multi-
faceted approach to delivering HR services that meets the needs of both employees and
employers, and positions of HR as a significant contributor to organizational success.
Ulrich presented his approach in terms of deliverables, or outcomes, for which HR should
be responsible: strategy execution, administrative efficiency, employee contribution, and
capacity for change. In the course of delivering in these four areas, he describes four
corresponding roles for HR to play within a business as strategic partner , administrative
expert, employee champion and change agent. a) as a strategic partner working to align
HR and business strategy. Assist line managers in solving organization, people and
change-related issues, b) as an administrative expert working to improve organizational
processes and deliver basic HR services, ensures internal and external customer focus,
applies information technology to rapidly deliver quality HR products and services. c) as

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Bussiness Scenario (ISBN 978-93-5258-981-4)

an employee champion, listening and responding to employees needs, develops

strategies and helps implement actions that enhance human capital contribution, ensures
fair, ethical, and equitable people processes and practices and d) as a change agent
managing change processes to increase the effectiveness of the organization, understands
the organization’s culture and what is effective and ineffective. Institutionalizes change
capability within the organization, assists line managers to lead and facilitate change,
enhances management development. He had all of the ways that HR can deliver value to
an organization, rather than shifting focus from one area to another.

Similarly, Johnson (1997) described his experiences in executive search in which CEOs
describe the HR leaders they want to hire. They want people who will be successful
business partners, strategic thinkers, and people who will understand the pressures of
running an effective business in today's market. He reports that, when hiring a leader for
the HR function, most CEOs ask for someone who is, "not a typical HR person," and that
most of the successful candidates describe themselves that way. This trend reflects the
common perception that HR "business-as-usual" is not prepared to meet the challenges
that today's businesses present.

Objective and Purpose of the Study

The objective of the paper is to study the challenges faced by human resource
departments in the 21st century and strategies to meet such challenges. It also suggests
steps to improve the working of human resource departments.

Research Methodology

The study is based on extensive review of high quality related literature based on work.
The paper is conceptual in nature describing the significant role of HR manager

Challenges faced by human resource departments in the 21st century

With the 21st century in progress, nonprofit, government, and private organizations seek
to adapt to an ever-changing professional environment. The cross-cultural, cross-border
intermingle has upshot in the formation of new class of people-global citizens with global
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Bussiness Scenario (ISBN 978-93-5258-981-4)

outlook, taste and network resulting in intricacy in the environment. Within these
organizations, human resource department face many challenges. Their role includes the
hiring of new employees, the administration of benefits, and the monitoring of regulation
observance. To best prepare themselves for the changing face of human resources
management, HR departments must rise to the challenges of retaining and building a
talented workforce. Multi-Generational Workforce One major challenge human resources
department’s face is serving multiple generations within a single workforce. For the
incoming workforce, the "hired for life" mentality of the past will be outdated as workers
increasingly change employers after 3 to 5 years of work. Placing more emphasis on
proper work-life balance, they will be motivated by learning opportunities and positive
feedback. To hold these employees, human resources departments must be ready to
respond to these needs. They must adapt to their changing role within an organization.
Moving from a traditional to a strategic approach, human resources management in the
21st century will be much more dynamic than in the past.

The basic personal functions that characterized traditional human resource management,
such as maintenance of personal files and records and the processing of documents will
be replaced by a focus on promoting the abilities, skills, and knowledge of employees.
HR departments can best prepare for their changing role by adopting a "human
investment perspective" that is more active than reactive and that no longer relies on the
hierarchical organizational structures of the past. Instead, the focus will be on catering to
the needs of consumers and employees and using business strategies in human resources
policies and practices. Recruitment Challenges Recruiting a workforce that reflects
today's reality is another challenge for human resources departments. To address the
challenge of attracting a new generation of employees,HR Recruitment agencies} can tap
into the popularity of the Internet. With online job postings and company websites,
human resources departments are now able to conduct around-the-clock recruiting. To
develop a workforce that reflects the diversity of consumers and clients, recruitment
consultants should reach out to minority groups that were discriminated against and
excluded in the past. For HR consultants, the new century will take up where the old one
left off - with the struggle to recruit and retain a trained, satisfied workforce. Human

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resource managers: their role in a changing environment Issues facing HR are expected to
change radically in the next decades.

Thus, HR professionals must play special roles in dealing with these changes and must
develop specific competencies to support these roles. Workplace flexibility is expected to
be on the rise as the future workplace, the ‘virtual office’ is characterized by creative and
flexible work arrangements. Specified work will become much more shared and
management will spend nearly all its time managing cross-functional work teams who
enjoy a lot of self-sufficiency. In a nutshell, there will be a movement, a trend towards a
decentralized model of HR. HR managers will have to accommodate employees in their
virtual work locations and find ways to manage corporate culture, socialization and
employee orientation. In order to obtain and maintain a competent workforce, they must
act as organizational performance experts and shape employees behavior without face to
face meetings. Another expected change in HR is the ‘Global Business’ concept world
trade knew a major growth during the last years and there is forecasted as well the growth
of international businesses, especially among small firms.
Organization relies more and more on HR specialists as the facilitators of work across
borders and among different cultures. Therefore, they must be knowledgeable of other
cultures, languages and business practices. They will be required to develop and manage
an international workforce, maintain written and unwritten corporate polices for
transportability to other cultures, keep top management informed of the costs of not
paying attention to the transnational issues and provide their services to a variety of
locations worldwide. Concerning the recruitment in the above mentioned ‘global
business’ it will be important which strategy will be adopted by the management for
recruitment solutions.

Strategies to meet challenges of human resource departments

Here are few strategies which can be put into practice as HR groups work to take action
towards various ecological and managerial changes, as they are becoming more precious,
and delivering good results.

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 Mission: Some companies are assigning HR employees to specific business units

as a way of enabling them to develop a focused relationship with a small part of the
business. This relationship can be enforced when the HR person has a direct reporting
relationship with the leader of the business unit. In these situations, the central HR group
usually provides information and services to the "distributed" HR representatives, who
then deliver the service personally to the business unit. One advantage of this structure is
that it fosters the flexibility and creativity mentioned above, as the local HR people can
modify and tailor processes and services to meet the needs of their assigned business
units.

 Distinct quality: As organizations grow by merger and acquisition, they often

find themselves with multiple HR groups. These can be duplicative or complementary.
When they are duplicative, they can be subject to (painful) downsizing and consolidation,
leaving behind a department that is unable to serve all areas of the business as well as
they had been accustomed, which can, in turn, undermine the credibility of HR. An
effective response to this issue is to utilize the multiple HR groups differently. One
approach that seems to work well is to develop "centers of excellence," where the HR
groups in different parts of the company develop their expertise in a particular area and
serve the needs of the larger company in that area-HR groups operating within this model
can see each other as resources rather than competitors, and the company benefits from
high levels of expertise in a number of areas.

 Consulting Employees: A number of HR departments with whom I've worked

have adopted a consulting model of providing service. They view their internal customers
as clients, learn consulting skills, and take their client satisfaction as a measure of their
success. In one large high-technology firm, internal clients whose needs cannot be met by
the internal HR group can go to external service providers directly-even for basic HR
needs.

 Rotating Jobs: One way to bring the perspective of the business into HR-and
vice versa-is to rotate line managers into the HR function for periods of time. These
individuals often serve as reality checks for the HR group, and then bring an increased

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understanding of the value of HR back to their line function when the rotation is over.
This approach seems to work best when the duration of the assignment is sufficient to
allow the rotated individual enough time to become proficient in some area(s) of HR and
when he or she is working closely with experienced HR people who can help them learn.
Sending HR people into other areas of the business can serve a similar purpose.
 Capabilities of line managers': Part of the future HR model is that responsibility
for HR activities is shared between line management and HR people. This approach
allows the manager to be more fully involved in the development and direction of
employees, with HR as a resource; it requires, however, that those managers have the
capabilities needed to work through issues with employees successfully. Many
companies are therefore increasing line managers' access to information. Many of today's
HR information systems and integrated HR systems put tools and data on each manager's
desktop.

Steps to improve the success of human resource departments

In this global environment the new HR role will raise unique issues for every HR group
that attempts it, but there are some common steps and activities that will enhance the
panorama of achievement. Some of these steps and activities are:

 Leadership: As with any major change effort, a strong leader can develop a clear
vision, motivate others to share that vision, and help them work toward achieving it. In
order to change the role of HR in an organization, the HR leader will need to work both
within the HR group and with the organizational leaders to reshape everyone's
expectations of what HR can and will deliver. The success of the change will depend
upon HR's ability to meet the real needs of the organization and the credibility it
develops.

 Future direction: One of the ways that HR can provide value is to understand how
changing environmental, organizational, and workforce factors will likely influence the
business, anticipate the associated HR needs, and be prepared to deliver appropriate
solutions to meet those needs. By maintaining a focus on workplace trends, for instance,

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HR can prepare to evaluate the impact that particular changes are likely to have on an
organization's people and processes, and be prepared to work with the business leaders to
decide how to respond-being ahead of the curve, not behind it. For example, one
movement that is likely to have significant impact on the way people are hired, managed,
and valued is that of intellectual capital. A "new role" HR department is one that has
learned about intellectual capital and its implications, evaluated the impact on current
practice, and developed ideas and recommendations for changing HR practice and other
business processes.

 Creativeness with flexibility: An HR group that is successful in the future will likely
be one that is responsive to the changing needs of its client organization. Responsiveness
in the changing world of work will require being flexible-as the organizations change, so
will their needs and priorities. In addition, traditional activities and processes may not be
sufficient to meet the unique needs of the future-HR leaders will likely rely on creativity
of their groups to achieve effective results. Increasing globalization of the market will
create a need for both flexibility and creativity as businesses try to succeed in new
locations, with a new workforce, and with new customers.

 Maintaining Values: Although this is not a new challenge for HR, it remains a
critical one. HR is still perceived by many within today's organizations as simply a non-
revenue generating function. It is important to make apparent the value provided by
working with the management team to hire the right people, manage them well, pay them
appropriately, and build a working environment that encourages success of business.

Conclusion

It can be concluded that it is the time for a quantum leap in the HR field, and
psychologists working with and for HR professionals can support this transition by taking
seriously the organizational pressures to change, helping to identify ways to provide
value to business organizations and conduct meaningful research related to all areas of
human performance in tomorrow's business. For meeting the various challenges faced by
the human resource departments there should be proper strategies to respond to

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environmental and organizational changes. There should be strong HR leadership,

flexibility and creativity and well planned acute future orientation.

References

Johnson, H. E. (1997). "Don't send me one of those typical human resource people": A
true life adventure story. In D. Ulrich, M. R. Losey, and G. Lake (eds.), Tomorrow's HR
management: 48 thought leaders call for change. Boston: Harvard Business School Press.

Ulrich, D. (1997). Human resource champions: the next agenda for adding value and
delivering results. Boston: Harvard Business School Press.

Beatty, R. W., & Schneier, C. E. (1997). New human resource roles to impact
organizational performance: From "partners" to "players." In D. Ulrich, M. R. Losey, and
G. Lake (Eds.), Tomorrow's HR management: 48 thought leaders call for change. Boston:
Harvard Business School Press.

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HR123

Role of trust in preserving social capital

*Dr. Manu Gupta, **Dr. Suman Kathuria

*Assistant Professor, Deptt of Hum & Mgt, GZSCCET, Bathinda
** Incharge, Deptt of Hum & Mgt, GZSCCET, Bathinda

Abstract

Generally speaking, income is important to everyone – in particular, a capacity to provide

the basics. But even more important than income is how we relate to others- the amount
and the quality of time we spend interacting with family, friends, colleagues and
neighbors and the level of positive feedback received from those interactions. People
generally underestimate the satisfaction and benefits they get from interacting with others
and these benefits and satisfaction achieved from interacting with others is called social
capital. Now social capital has been widely recognized in the recent literature to have
positive consequences on economic development. Regardless of this, organizations in
India are not much aware about the social capital and its benefit. In India a large number
of social relations exist, but there is lack of trust in those relations. Social relations
without trust do not provide any benefit and satisfaction thus do not constitute social
capital. So, to have benefits of social capital there must be trust among the members of
social relations. This paper is an initiative to demonstrate the importance of social capital
and trust to the organizations for their future development. For this author has also
developed a framework which shows the relationship between social capital and trust.

Keywords: social capital, trust, social relations.

Introduction

The concepts of ‘trust’ and ‘social capital’ have enjoyed increasing vogue now for more
than a decade. History has been mobilized to support them in various ways. Past societies
are often portrayed as having enjoyed more trust than modern ones. History is mined for

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examples of the closely-knit and multi-stranded social networks thought to generate

particularly rich stocks of social capital. Trust looms large in the debate about social
capital. Some consider trust as an outcome of social capital (Woolcock, 2001).
As Putnam concludes that ceteris paribus, one would expect communities blessed
with high stock of social capital to be safer, cleaner, wealthier, more literate, better
governed and generally happier than those with low stock, because these members are
able to find and keep good jobs, initiate projects serving public interest, costless monitor
one another’s behavior, enforce contractual agreement, use existing resources more
efficiently, resolve dispute more amicably and respond to citizens concerns more
promptly. But all these benefits are possible only when there is trust among the members
of social network. A large number of social relations do not constitute large stock of
social capital. Any social relation will become social capital only when that relation is
having trust, but if we look at our surrounding we will find that now a day’s trust is
reducing at work and in personal relationship also. This paper demonstrates the
importance of social capital and trust to the organizations for their future development by
developing a framework which shows the relationship between social capital and trust.

Theoretical Background

Social Capital

Social capital has a long intellectual history, but has gained celebrity only in the nineties,
due to Bourdieu’s (1980, 1986), Coleman’s (1988, 1990) and Putnam’s (1993, 1995)
seminal studies.
Social capital consists of the resources that are embedded within people's social
networks. Bourdieu (1980) identifies Social capital as the aggregate of the actual or
potential resources which are linked to possession of a durable network of more or less
institutionalized relationships of mutual acquaintance and recognition. Coleman (1988)
defines Social capital not by what it is, but by what it does, or by its function. It is not a
single entity, but a variety of different entities, having two characteristics in common:
they all consist of some aspect of a social structure, and they facilitate certain actions of
individuals who are within the structure. Putnam (1993) viewed social capital as the

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connections among individuals – social networks and the norms of reciprocity and
trustworthiness that arise from them. In that sense social capital is closely related to what
some have called “civic virtue.” The difference is that “social capital” calls attention to
the fact that civic virtue is most powerful when embedded in a sense network of
reciprocal social relations. A society of many virtuous but isolated individuals is not
necessarily rich in social capital. In the views of World Bank: 'Social capital refers to
the institutions, relationships, and norms that shape the quality and quantity of a society's
social interactions… Social capital is not just the sum of the institutions which underpin a
society – it is the glue that holds them together' (The World Bank 1999).

TRUST
Trust has been approached from multiple disciplines, perspectives, and levels of analysis,
producing a multiplicity of meanings for the term. Despite this, nearly all scholars agree
that there are two essential elements to the concept of trust: positive expectations and a
willingness to be vulnerable (Rousseau et al., 1998). Positive expectations are confident
beliefs held by Party A that Party B will act in a fashion that is consistent with Party A’s
welfare Zucker (1986). Vulnerability can be conceived as risk of potential loss and
suggests that the trustier is willing to take a risk by placing his or her welfare in the hands
of another (Mayer, Davis & Schoorman, 1995).
Recognizing the problem of defining trust, and of distinguishing it from a large
family of similar and closely related terms, the working definition of trust is a belief that
others, at worst, will not knowingly or willingly do you harm, and at best, will act in your
interests. This is a fairly close approximation to Hardin’s succinct definition that trust is
'encapsulated interest Hardin (1998), which means I trust you because your interest
encapsulates mine, so you have an interest in fulfilling my trust.
Trust is a key ingredient in networking because it determines whether an
individual enters an exchange relationship. Trust facilitates communication, information
sharing, and collaboration. Trustworthy members can provide social and emotional
support, resulting in stronger emotional attachment and satisfaction. Trust is associated
with job satisfaction, innovative behavior, and organizational citizenship behavior
Konovasky and Pugh (1995). High-trust people are reported to feel more satisfied in life

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and work. Trust is so integral to our relationships that we often take it for granted, yet in
an era marked by business scandals it becomes more important to nurture trust in our
professional and personal lives. Trust has a bottom-line impact on results and that when
trust goes up, speed goes up while costs come down. This principle applies not only in
our professional relationships with customers, business partners, and team members but
also in our personal relationships.We generally care about the patterns of our
relationships. We humans want to know where we “stand in love, hate, respect,
dependency, trust” in relation to somebody else, a group, a company, or a nation state. “If
we trust and find that which we have trusted was untrustworthy; or if we distrust, and
find that which we distrusted was in fact trustworthy, we feel bad. The pain that human
beings can suffer from this type of error is extreme.”

Trust and Social Capital

Fukuyama (1995) is most well known for his integration of social capital and trust and
he defines trust and social capital in the following quotation.
“Trust is the expectation that arises within a community of regular, honest, and
cooperative behavior, based on commonly shared norms; on the part of other members of
that community … Social capital is a capability that arises from the prevalence of trust in
a society or in certain parts of it. It can be embodied in the smallest and most basic social
group, the family, as well as the largest of all groups, the nation, and in all the other
groups in between. Social capital differs from other forms of human capital insofar as it is
usually created and transmitted through cultural mechanisms like religion, tradition, or
historical habit.”

The returns to social capital are many, in this view, but all fall into one of four
categories. First, social networks promote shared norms, creating expectations of
trustworthiness which reduce the transactions costs associated with violation of
agreements. Second, social networks improve information flow, creating the trust
necessary to solve market failures caused by incomplete or asymmetric information.
Third, social networks create the trust that facilitates group sanctions against deviations
from the network’s norms .Fourth; social networks create the trust that overcomes

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obstacles to collective political action to monitor government. Social capital is held to be

created when social networks create the trust necessary for correcting failures of markets
and states, and this investment pays off in terms of better contract enforcement,
information, sanctions, and collective action. The total cost of the investment in social
capital, it is claimed, is exceeded by the total benefit flowing from these four sources.
Trust is the central component of social capital. In one way, trust is a critical
factor affecting inter-firm knowledge transfer and creation (Dodgson, 1993; Doz, 1996).
In other way, trust plays a key role in the willingness of network actors to cooperate,
which in the long term, results in a higher chance of a company to innovate and grow. In
the long term, high level of trust results in building stronger ties and leads to improved
cooperation.The central point here is that many social and political theorists from
Thomas Hobbes to Robert Putnam agree that trust is an essential ingredient of civilized
social and political life, and that low levels of political trust, as an indicator of political
disaffection, create problems for democratic politics. As it is true in case of India. India is
called a democratic country, but is it really a democratic country? People vote a particular
person because they trust that the government will work for their welfare. But see what is
happening, after wining they are busy in filling their own pockets who care for the poor
people. very well said by one of the director of Swiss bank that” Indians are poor but
India is not a poor country”. He says that “280 lacs crore” of Indian money is deposited
in Swiss banks which can be used for ‘tax less’ budget for 30 years, Can give 60 crore
jobs to all Indians, From any village to Delhi four lane road, Forever free power supply to
more than 500 social projects, Every citizen can get monthly 2000/- for 60 years, No
need of world bank and IMF loans. Think how our money is blocked by rich politicians.
There is no such thing as general trust, but rather different kinds of trust which
expressed by different types of people for different reasons. Social disaffection, in the
form of low or declining social trust, is one thing; political disaffection, in the form of
low or declining political trust is another. Fukuyama (2000) takes up a concept called
"radius of trust". By this he means a circle of people among whom co-operative norms
operate. On the basis of above literature a framework is framed which shows the
relationship between social capital and trust (Figure 1)

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High

Strong ties High stock of

Closure (Coleman, social capital
Trust
1988)

Low stock of Weak ties

social capital Structural holes
(Burt, 1992)
Low
Low High
Number of social relations
Figure 1: Framework of trust and social capital
This framework has two dimensions: number of relations and trust. A person having less
social relation and in those relations he is not having trust that means that person has very
low stock of social capital. In the same way a person having a large amount of social
relations and he has a very high trust in those relationships means that person enjoys high
stock of social capital. On the other side a person having less number of social relations
and he has very high trust in those few relationships then it is called strong ties or close
relationships as given by Coleman (1988) he argues that closure of the network
structure—the extent to which actors' contacts are themselves connected—facilitates the
emergence of effective norms and maintains the trustworthiness of others, thereby
strengthening Social capital. In a more open structure, violations of norms are more likely
to go undetected and unpunished. People, thus, will be less trusting of one another,
weakening social capital. In the same way a person having a large number of social
relations but he do not have trust in that relationship, then it is called weak ties and there
exist structural holes as given by Burt (1992) he argues that the opportunity to broker the
flow of information between groups constitutes a central benefit of social capital, and if,
in general, information circulates more within than between groups, then a key source of
social capital is a network of ties characterized by many structure holes—linkages to
groups not otherwise connected. The long lineage of organizational research on brokers,

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gatekeepers, and boundary spanners shows some of the power of this form of social
capital
Conclusion
In this paper we attempted to demonstrate the importance of trust in building social
capital at workplace. For this purpose a framework of trust and social relations has been
framed. This paper also presents the role of social capital in the development of
organizations. Organizations can utilize this valuable information and build an
environment of trust which further leads to a good stock of social capital in the
workplace.

References:-

1. Burt, R. S. (1992). Structural holes: The social structure of competition,

Cambridge, MA: Harvard University Press.
2. Bourdieu, P. 1986. ‘The Forms of Capital.’ Pp. 241-58 in Handbook of theory and
research for the sociology of education, edited by John G Richardson. New York:
Greenwood Press.
3. Coleman, James S. 1988. ‘Social Capital in the Creation of Human Capital.’ The
American Journal of Sociology 94: S95.
4. Coleman, James S. 1990. Foundations of social theory. Cambridge: Harvard
University Press.
5. Dodgson, Mark 1993 ‘Learning, trust and technological collaboration’. Human
Relations 46/1: 77–95.
6. Doz, Y.L (1996), The evolution of co-operation in strategic alliances: Initial
conditions or learning process? Strategic management journal, 17, Summer, P. 55-
85.
7. Fukuyama, Francis. 1995. Trust: the social virtues and the creation of prosperity.
London: Hamish Hamilton.
8. Fukuyama, Francis. 2002. ‘Social capital and development: The coming
agenda.’ SAIS Review22: 23-37.

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9. Hardin, G. (1998). "Essays on Science and Society: Extensions of "The Tragedy

of the Commons"". Science 280 (5364): 682–
683. doi:10.1126/science.280.5364.682
10. Mayer, Roger C., James J. Davis, and F.David Schoorman 1995 ‘An integrative
model of organizational trust’. Academy of ManagementReview 20/3: 709–734.
11. Konovsky, M.A. and Pugh, S.D. (1994) Citizenship Behavior and Social
Exchange. Academy of Management Journal, 37, 656-669.
12. Putnam, Robert D. 1993. “The prosperous community: Social capital and public
life.” The American Prospect 4.
13. Putnam, Robert D. 1995. “Bowling alone: America’s declining social
capital.” Journal of Democracy 6: 65-78.
14. Woolcock, Michael. 2001a. “Microenterprise and social capital: a framework for
theory, research, and policy.” The Journal of Socio-Economics 30: 193-198.
15. Zucker, Lynne G.1986, ‘Production of trust: institutional sources of economic
structure. 1840–1920’ in Research in organizational behaviour. B. M. Staw and L.
L. Cummings (eds.), 53–111. Greenwich: JAI.

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HR-124

ORGANISATIONAL NEEDS ASSESSMENT FOR WELLNESS AND HEALTH

PROMOTION PROGRAMS

*Ms. Amaniander kaur Dheendsa

*Assistant Professor, GZSCCET, Bathinda

Abstract
Before the start of an actual training program the first important step is to conduct a
training needs analysis so as to determine the actual area where training is essential.
Although a lot of importance has been attached to the conducting of a needs assessment
but no one has gone into the details of how to conduct a successful needs assessment. A
needs assessment map has been suggested that an HRM can adopt in order to conduct an
organizational needs assessment before launching a wellness and health promotion
program.

INTRODUCTION
A health and wellness program can be defined as “an organized, employer-sponsored
program that is designed to support employees (and, sometimes, their families) as they
adopt and sustain behaviours that reduce health risks, improve quality of life, enhance
personal effectiveness, and benefit the organization’s bottom line” (Berry,
Mirabito&Baun, 2010, p. 106).

The needs assessment for wellness and health promotion is the first step in the
instructional system design model. (Clark). The ISD model of training incorporates a
three-part process:

 Needs Analysis,
 Training Design and Delivery, and
 Training Evaluation (Kelloway& Francis, 2008)
“The ISD model provides a means for sound decision making in order to determine the
who, what, when, where, why, and how of a learning program. The concept of a system
approach is based on obtaining an overall view of the learning process. It is characterized
by an orderly process for gathering and analyzing collective and individual performance
requirements, and by the ability to respond to identified training needs. The application of

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a systems approach insures that learning programs and the required support materials are
continually developed in an effective and efficient manner to match the variety of needs
in a rapidly changing environment.” (Clark)

“Needs analysis is the initial stage of the training development process, intended to
identify employee and organizational deficiencies that can be addressed with training and
to recognize potential obstacles to the success of a training program” (Kelloway&
Francis, 2008)

So we can say that before we start the actual training program the first important step is
to conduct a training needs analysis so as to determine the actual area where training is
essential and is thus required.

Needs assessment typically involves:

 Organizational Analysis
 Person Analysis, and
 Task Analysis (Noe&Peocock, 2008)
“Organizational analysis is the analysis of the entire organization designed to examine its
resources, strategy, and environment in order to assess the organization’s support for
training” (Kelloway& Francis, 2008)

“Approaching appropriate stakeholders and securing their participation is an important

aspect of the planning stage of the training initiative.” (Baun& Scott, 2010)

The important areas that need to be focussed when conducting a needs assessment for
wellness and health promotion programs:

 Resources that the organization can dedicate

 The industry and environmental factors
 Degree of organizational support
 Support for health and safety initiatives (Kelloway& Francis, 2008)
 Safety climate, shared perceptions regarding importance of safety-related policies,
procedures and practices

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REVIEW OF LITERATURE & IMPLICATIONS

ORGANIZATIONAL PERFORMANCE AND ORGANIZATIONAL LEVEL

TRAINING AND SUPPORT

Russell, J. S., Terborg, J. R., & Powers, M. L. (1985).

This study uses both objective and survey data to examine relations among retail sales
training, organizational support, and store performance and to examine whether training
interacts with organizational support to predict store performance. Archival data in a co
relational design were analyzed for 62 stores belonging to the same international
merchandising firm. Two measures of training and two measures of support were used to
predict two measures of store performance. Results indicated that training and
organizational support were significantly correlated with both measures of store
performance, which further indicates the importance of assessing organizational support
before actually implementing a wellness and health program. The relationship between
training and organizational performance was also strong.

MANAGERS' PERSONAL VALUES AS PREDICTORS OF IMPORTANCE

ATTACHED TO TRAINING AND DEVELOPMENT: A CROSS-COUNTRY
EXPLORATORY STUDY

McGuire, D., Garavan, T., O'Donnell, D., Saha, S., &Cseh, M. (2008).

This study argues that personal values play an important role in decision-making
processes (i.e. commitment to training and development) and those values are the product
of socialization processes operating at an organizational and societal level. Questionnaire
data were collected from 340 Irish and Canadian line managers to test the hypothesis that
personal values affect the importance attached by respondents to training and
development. Capability values were found to be a significant positive predictor of the
perceived importance of training and development. The findings emphasize the need for

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simultaneously examining both personal values and organizational factors as predictors

of training and development activity.

THE MEDIATING ROLE OF TRAINING UTILITY IN THE RELATIONSHIP

BETWEEN TRAINING NEEDS ASSESSMENT AND ORGANIZATIONAL
EFFECTIVENESS

Van Eerde, W. W., Tang, K., & Talbot, G. (2008).

This study focussed on the results of a survey among respondents from 96 organizations,
and it was found that the utility of training partially mediated the relationship between
training needs assessment comprehensiveness and the effectiveness of the organization. It
was also seen from the empirical data’s results that training quantity had no effect on
training utility and organization effectiveness. Both training needs assessment
comprehensiveness and training quantity were also found to be unrelated to
organizational size. Thus the results of the survey supported the importanceof conducting
a training needs assessment and focussing on quality of need based training rather than
quantity.

WHAT'S THE HARD RETURN ON EMPLOYEE WELLNESS PROGRAMS?

Berry, L. L., Mirabito, A. M., &Baun, W. B. (2010).

Strategically integrated wellness programs have six strong pillars that simultaneously
support their success, regardless of the size of the organization. Construct them well, and
your institution could see the big returns, this is what this paper suggests:

 Multilevel Leadership: Creating a culture of health takes passionate, persistent,

and persuasive leadership at all levels.
 Alignment: A wellness program should be a natural extension of a firm’s identity
and aspirations as a cultural shift might take a long time.
 Scope, Relevance, and Quality: Wellness programs must be comprehensive,
engaging, and just plain excellent. Otherwise, employees won’t participate.

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 Accessibility: Aim to make low or no-cost services a priority. True on-site

integration is essential because convenience matters.
 Partnerships: Active, ongoing collaboration with internal and external partners,
including vendors can provide a program with some essential components and
many of its desirable enhancements.
 Communications: Wellness is not just a mission-it’s a message. How you deliver
it can make all the difference. Sensitivity, creativity, and media diversity are the
cornerstones.
Looking at the various aspects involved in the success of a wellness program, the
importance of organizational needs assessment becomes even more evident. The human
resource manager has to make sure if the organization’s culture supports the wellness
programs and thus would in turn support wellness initiatives or not.

Although the studies so far have studied the importance of conducting a needs
assessment but none of them has actually gone into the details of how to conduct a
successful needs assessment. So the further studies would be focusing on the process
part of needs assessment and a needs assessment step by step guide would be
created.

COLLECTING DATA TO DRIVE HEALTH EFFORTS: WELLNESS COUNCIL

OF AMERICA

The council suggests focusing the organizational assessment for wellness programs on
these two major areas:

 What does the business need out of their health promotion efforts, and
 What do the employees want
If the first one is ignored, sooner or later the health promotion efforts will get downsized
out of existence. The HRM needs to provide a business benefit to justify the need — and
the best way to begin is by meeting business needs.

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And if the program is set up without knowing what the employees are interested in, it
would result in a waste of money and effort. The HRM must know what’s going to attract
participation and enthusiasm from the onset.

1. Where to find business needs data

Medical claims: How much is your business paying for employee medical care? Are
there trends in the claims data? Are injuries increasing? If you’re self-insured, your
benefits manager can analyze claims and tell you where the dollars are going.

Disability: What causes employees to become disabled? Are your claims related to
injuries from heavy lifting, repetitive motion, or perhaps stress due to travel? Disabled
employees can be very expensive; the more you can learn about this area, the better.
Facility Assessment:This is an objective look at the health and safety of your building. It
includes looking at work stations, ergonomics, eating facilities, temperature, lighting,
security, hygiene, crowding, isolation, fire safety, slippery floors — any factors which
affect the potential health of your workers.

Health Risk Appraisals: HRAs are health questionnaires contain questions which your
employees answer about their health habits and histories. These can provide confidential
health risk reports to employees and an aggregate report to the company.
Screening Data:This data, often collected at health fairs, is a great supplement to HRAs.
Blood pressure, height/weight ratios, cholesterol levels, hearing, and other variables can
be directly measured. The employee population should determine which tests are
appropriate, since age and gender are factors in many health conditions.

Culture Audit: A culture audit, often a questionnaire, assesses the organizational culture
and whether it promotes health. It looks at the unwritten rules and assumptions which
pervade the company — the stuff that may not be in the policy and procedures manual,
but which everyone goes by. It’s great that the CEO says that “Our number one concern
is the health and well-being of our employees.” With a culture audit, you can find out
whether the message has gotten across, by asking the employees if they feel the
company’s concern.

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Absenteeism: The absenteeism rates are a good indicator of the health and morale of
your employees.
The business needs data provide a good picture of corporate health issues. Without this
information, the HRM runs into the risk of making poor decisions. Knowing what’s
happening at the business level isn’t enough, the HRM needs to know what

the employees care about.

2. How to get employee interest data

After collecting the information that helps identify the status and needs of the
organization, it’s time to find out what the employees want. This is a matter of getting in
touch, of asking questions and really listening to the responses. It can be done through
focus groups, individual interviews, simple surveys, open-ended E-mail questions, or in
meetings.

Insightful HRM’s will have to balance corporate needs and individual interests which is
not an easy task. But unless you keep employees interested, you won’t get the
participation you need to make a difference. The HRM’s goal is a marriage of the best
interests of the business and the employees.

WELLNESS PROGRAM: ASSESS EMPLOYEE NEEDS AND

INTERESTS

This article on the website related to wellness proposals highlighted the various types of
wellness assessments and sources.

Different wellness program assessment tools can provide different types of important
information. Therefore, a worksite wellness program may benefit most from using each
of the following types of assessments a suggested by the website.

Worksite Wellness Program: Employee Interest Survey

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Since worksite wellness programs are for employees, it's a good idea to find out from the
employees about the approaches that would have the greatest chance of success. A simple
survey made up of 10 or 12 questions can provide valuable information. Some of the
questions can be:

* Discover how employees want to receive program information (e.g. electronically,

strategically-placed bulletin boards, memos, etc.).

* What health components (nutrition, physical activity, tobacco) are they most
interested in addressing and how?

* What types of groups might employees be most inclined to join (e.g. walking, yoga,
cooking, biking, weight-loss, dance, martial arts, nutrition, etc.)?

* Which employees have expertise that may be useful to the program?

Organizational Health Survey

The organizational surveys are geared to obtain information on the organization's

environmental indicators from both managers and the general workforce. The surveys are
comprised of questions that reveal the extent to which opportunities exist in the
workplace to pursue and maintain a healthy lifestyle.

Health Risk Assessment (HRA)

The health risk assessment is central to health promotion programs. It helps companies of
all sizes identify their workforce's problems and establish targets for improvement. Using
the HRA, the HRM can discover risk levels, determine appropriate interventions and
measure results.

Thus we can see that the HRM can use a variety of tools to conduct the organizational
needs assessment for wellness and health promotion programs and this assessment is
widened by conducting an assessment of the employee needs and interests as well.

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The organization’s needs for a wellness and health program cannot exist in vacuum and
has to have a link with the employee needs. So the employee needs assessment must be
complementarily conducted with the organizational assessment in order to determine the
appropriate needs.

CONCLUSION

Occupational health and safety training can be described under the general training model
and so can be wellness and health promotion programs. The instructional systems design
model, applied to the issue of health and safety, emphasizes the importance of a complete
needs analysis before training is designed and offered.

Needs analysis includes a consideration of the organization, the job, and the person. One
very important issue in health and safety is ensuring that the organization is supportive of
the initiative. If a company is not supportive of health and safety issues in general, the
training effort is likely to encounter roadblocks.

Several factors must be considered in the design and delivery of occupational health and
safety training, including the content of the training, who will receive training, and who
will act as the trainer. Organizations must be careful that the training programs they offer
comply with standards set out in their jurisdictional occupational health and safety act.

A needs assessment can gauge the extent of costs that may arise from accidents, injuries,
and high turnover rates. A needs assessment can also address workplace legal mandates,
executive mandates, mission, goals, culture, internal and external constraints, facilities,
resources, and the knowledge base. And it can use a variety of techniques to measure the
extent of the needs and to identify program components that are likely to be the most
useful in addressing those needs. (Kelloway& Francis, 2008)

From the last few researches, it can be seen that the employee assessment can help a lot
in the organizational assessment and this can be done with the help of a lot of tools that
have been discussed in the research papers. The following is a Needs Assessment Map
that an HRM can adopt in order to conduct an organizational needs assessment before
launching a wellness and health promotion program (workplace.samhsa.gov). The needs

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assessment is an on-going process which does not end once the program has started, it
extend even beyond it.

Decide Who Conducts the Needs Assessment

Some employers hire consultants to conduct needs assessments and evaluations.However,

hiring outside help may not be an option for organizations with limited resources. Just as
a policy and program doesn’t have to be complex and costly to be effective, a needs
assessment doesn't have to be complicated. Anyone—from a business owner or
organization head to an HR representative to an outside consultant—can conduct a basic
needs assessment within an organization, appropriate to the organization size. The needs
assessment can be tailored to the amount of resources a company has in order to address
this issue.

Involve Others

One key to the success of any employee wellness and health program is to involve
employees from the very beginning of the needs assessment process. They certainly will
want to enlist their cooperation and support in the early stages of assessing needs.
Employers will probably also want to include both supervisory and nonsupervisory
employees in this process.

Articulate the Mission and Goals

Success can mean different things to different people. Some employers, for example, may
want primarily to meet the legislative requirements. Other employers may want to
improve productivity and the return on their investment. Still others may want to change
the lives of their workers and their workers’ families.

When starting to assess workplace needs, it is helpful to ask some key questions which
can include:

• What legislative or regulatory requirements must the organization meet with

respect to substance use and abuse?

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• Are there employees in safety-sensitive roles like employees who drive vehicles,
operate machinery, handle chemicals, or work with the public—particularly with
children?
• Are there employees in jobs that are security sensitive? For example, are there
employees who are responsible for confidential ideas, products, plans, or documents;
employees who are responsible for accounting, cash, inventory, or stock; or employees
who work offsite, such as traveling salespersons, home workers, or home health care
workers?
• Do certain employees perform functions that are of extreme importance to the
organization? For example, are there accountants who handle large sums of money, sales
persons who represent the company to key buyers, employees who monitor nuclear
power dials, or supervisors who manage many employees?
Link Each Goal to Something Measurable

If one of the goals is to “have an employee who is healthy,” determine exactly what this
means and how this will be measured. Such broad goals are often measured by defining
more concrete, strategic objectives.

Get a Baseline

Document what the workplace is like before the wellness and health program are
implemented. This pre-test, or baseline, information gives something to compare with
after the policy and program have been developed and implemented. To develop a useful
baseline for a wellness and health program, a workplace can do the following:

 Collect and Analyze Data on the Current Situation

 Qualitative Data and Quantitative Data
 Understand Legal and Other Requirements
Review national, state, and local industry requirements for health and wellness.

 Identify Future Needs and Goals

What is the business development plan? How will the policy and program affect this?

 Identify Resources

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Look at internal and external resources for implementing a policy and program.

Estimate the Costs and Benefits

Rising health care costs have increased pressure on employers to monitor costs, cost
effectiveness, and cost-benefit ratios for all health care services. Even though the exact
economic costs and benefits of a health and wellness workplace policy and program can
be difficult to measure, reasonable estimates can be calculated. Returns on investment
(ROIs) have varied across industries and geographical locations, but a company estimates
that moving 10% of its employees from high- and medium-risk to low-risk status yield an
ROI of 6 to 1. (Berry, Mirabito&Baun, 2010, p. 112)

Other goals of the health and wellness programs may include promoting healthy
behaviours at work, encouraging workers to develop a team focus, and creating a
supportive work environment.

Although it may take a while before some cost savings become visible, improvements in
employee morale may be evident right away.

Describe the Process

Document the steps taken to develop and implement the policy and program. Recording
this information can help an employer improve the process later on. Some steps that
might be taken and that should be documented include developing consensus by building
a team, revising the policy to incorporate feedback from others, addressing legal
requirements, and assessing employees’ strengths and their areas in need of
improvement.

Find a Way to Compare

It can be helpful to compare what the workplace looked like both before and after
implementing the policy and program, as a way to show savings and costs.

Another powerful way to show change is to compare the organization’s efforts with the
efforts of another organization. Some professional groups encourage this kind of
comparison. Another way is to compare one of the organization’s worksites (for example,
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one that has an extensive program) with another of the worksites (for example, one that
has only very basic health and wellness program).

Evaluation should be ongoing. Don’t be discouraged if results aren’t apparent right away.
The cycle of evaluation encourages ongoing reassessment of the goals, objectives, means
for achieving those objectives, and ways of measuring processes and outcomes. The
evaluation results will contribute to informed decisions about whether, and in what ways,
the policy and program can be improved.

REFERENCES

Baun, J. T., & Scott, M. (2010). Business Education under the Microscope: Applying Six
Sigma to Workplace Training. T+D, 64(8), 62-67. Retrieved from EBSCOhost.

Berry, L. L., Mirabito, A. M., &Baun, W. B. (2010). What's the Hard Return On
Employee Wellness Programs? Harvard Business Review, 88(12), 104-112.
EBSCOhost.

Clark, D. Why Instructional System Design. Retrieved from

http://www.nwlink.com/~donclark/hrd/sat1.html

Collecting Data to Drive Health Efforts: Wellness Council of America. Retrieved from
http://www.welcoa.org/wellworkplace/index.php?cat=2&page=9

Conducting a needs assessment. Retrieved from

http://workplace.samhsa.gov/WPWorkit/pdf/conducting_a_needs_assessment_br.pdf

Kelloway, E.K. & Francis, L. (Ed.). (2008). Management of Occupational Health &
Safety, (4th Ed.). Toronto, ON: Nelson Education

McGuire, D., Garavan, T., O'Donnell, D., Saha, S., &Cseh, M. (2008). Managers'
personal values as predictors of importance attached to training and development:

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a cross-country exploratory study. Human Resource Development International,

11(4), 335-350. Retrieved from EBSCOhost.

Noe, R. A., & Peacock, M. (2008). Employee Training & Development. Toronto:
McGraw-Hill Ryerson.

Quinn, R. E., &Rohrbaugh, J. (1983). A Spatial Model of Effectiveness Criteria: Towards

a Competing Values Approach to Organizational Analysis. Management Science,
29(3), 363-377. Retrieved from EBSCOhost.

Russell, J. S., Terborg, J. R., & Powers, M. L. (1985). Organizational Performance and
Organizational Level Training and Support. Personnel Psychology, 38(4), 849-
863. Retrieved from EBSCOhost.

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HR125

IMPACT OF GLOBALIZATION ON SOCIETY AND HUMAN

DEVELOPMENT
*Rajesh Singla **Shikha Aggarwal
*Associate Professor - Microbiology and Head, Agriculture Department, S.S.D.
College of Professional Studies, Bhokhra - 151201, Bathinda, Punjab, INDIA.
[email protected], 9356460660.
**Assistant Professor, Commerce Department, S.S.D. College of Professional
Studies, Bhokhra - 151201, Bathinda, Punjab, INDIA.
[email protected], 9478162459.
ABSTRACT
Globalization indicates that the world today is more interconnected than before. Though,
globalization is a process by which capital, goods, services and labour crosses the
national borders and acquire a transnational character, it is often accompanied by the flow
of related lifestyles, tastes, ideas, and even values across boundaries which reshapes the
local cultural patterns, social relations and finally political institutions. It also creates new
opportunities for many peoples to increase their wealth and enhance their prosperities and
as such has huge impact on society and human development. Globalization is associated
with rapid and significant human changes and these changes also affect the identities of
the people and their cultural values, which sometimes become altered significantly. The
movement of people from urban to rural areas has also accelerated which has lead to
increased family disruptions, social and domestic violence’s. The purpose of this paper is
to examine the positive and negative aspects of globalization and to realize how one
could successfully deal with the challenges it poses.
Keywords: globalization, transnational, social relations, prosperities.

INTRODUCTION
“Globalization” is currently a popular and controversial issue, though often remaining a
loose and poorly-defined concept. Sometimes, too comprehensively, the term is used to
encompass increases in trade and liberalization policies as well as reductions in

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transportation costs and technology transfer. Globalization involves economic

integration; the transfer of policies across borders; the transmission of knowledge;
cultural stability; the reproduction, relations, and discourses of power; it is a global
process, a concept, a revolution, and “an establishment of the global market free from
sociopolitical control. As far as its impact is concerned, discussion of globalization tends
to consider simultaneously its effects on economic growth, employment and income
distribution. It is often without distinguishing between countries and within-country
inequalities and other social impacts such as opportunities for poverty alleviation, human
and labour rights and environmental consequences and so on (Lee and Marco, 2006).
In 1995, Martin Khor, President of the Third World Network in Malaysia, referred to
globalization as colonization. Concurrently, Swedish journalist Thomas Larsson in 2001
in his book, The Race to the Top: The Real Story of Globalization stated that
globalization “is the process of world shrinkage, of distances getting shorter, things
moving closer. It pertains to the increasing ease with which somebody on one side of the
world can interact for mutual benefit with somebody on the other side of the world.”
For thousands of years, different countries have been doing trade with one another. But
the process has been got a tremendous boost in about last two decades due to high handed
policies of International Monetary Fund, World Bank and World Trade Organization who
have been working on the agenda of developed countries like USA. They practically
forced underdeveloped countries to adopt full throttle globalization by opening up their
local markets to world by reducing artificial barriers to such side. Development of
advanced means of communication and transport, internationalization of financial
markets and unprecedented mobility of goods, capital, data and manpower have further
given boost to the recent process of globalization (Jindal, 2013).
Globalization was planned to be only a trade relationship. But, the process as a by-
product has integrated national and regional economies, societies and cultures through
global network of trade, communications and migrations. As per one estimate there are
about 200 million migrants around the world today and they are largely from
underdeveloped countries to developed countries. These immigrations and other human
links have changed socio-cultural face of various countries all over the world. This paper
as such would examine the impact of globalization on society and human development.

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REVIEW
Most researches generally support the hypothesis that there is a positive relationship
between the degree of openness and higher Gross National Product (GNP) growth rates.
They have shown that there is positive association between the degree of openness and
GNP growth rates. Multinational corporations are the main instruments of globalization.
They possess huge capitals and assets. As profit maximizers, they establish their factories
in many developing countries where cheap workers/labour and raw materials are found.
Because of their size and their contributions to national economies in terms of taxes and
employments, they influence decision-making processes in those countries. Once they get
established, none has the ability to stop them from withdrawing their investments or
moving their capitals from one country to another whenever it is in their advantage to do
so. In spite of their contributions, the given privileges are not without price. Their
activities usually leave serious effects on many host economies; they even sometime
create civil unrests. This is because these companies control not only markets, but also
peoples (Micklethwait and Wooldridge, 2001).
Singh (2012) in his research paper highlighted the reforms in the economy Indian history
right from the pre-British era to present stage of liberalization, privatization and
globalization. Indian economy has a very diverse experience from prosperity to poverty.
The reforms had gained momentum during 90’s when a drastic change took place in
industrial policy, financial policy, public sector, capital market and trade policy. A
comparison has been done by comparing the reforms taken from British to present state.
India must launch a ‘second generation’ of economic reforms, with a more human face, if
it is to reap their full potential. Politicians and administrators need to display greater
pragmatism while designing and implementing future economic reforms based on the
long-term vision of transforming India into a global economic power in the next twenty
to twenty-five years.
Jindal (2013) in his work highlighted the impact of globalization on Indian economy.
Indian Government adopted globalization during 1990-91 when the economy of our
country India was in a very bad shape. It was adopted to enable the deteriorating Indian
economy to get foreign exchange loans from World Bank as its foreign exchange
reserves were reduced to mere 3 weeks outflow and not as a solution. Indian government

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simultaneously decided to amend its economic policies and go for privatization and
liberalization of its economy in order to rectify its ailing financial health. These decisions
though had immediate positive effects but globalization proved to be a double edged
weapon. It did helped government temporarily to meet its emergent need of foreign
exchange but it has, as a by-product, caused some permanent damage to Indian Economic
system and Indian social structure.
Meenu (2013) in her research paper based on primary as well as on secondary data
examined the impact on Indian administration made by globalization and liberalization
and provided a framework for administration to circumvent the overbearing effect of
globalization in their effort towards industrialization, economic growth and development.
The attempt has been made in her paper to analyse the impact of globalization and
liberalization on different aspects of Indian administration and changes introduced at
different levels in Indian administration due to globalization and liberalization. The
primary objective of liberalization is to free from the restrictions on production,
expansion and following of rigid rules and regulations. Competition among firms to get a
good a share of the large world market leads to specialization and efficiency, better
quality products at reduced prices, economies of scale in production as well as
technological and managerial improvements.
Agarwal and Goel (2014)analysed the impact of globalisation on the growth of small
scale industries (SSI). The comparative analysis of growth pattern between pre and post
globalisation periods in Indian economy revealed that globalisation had a negative impact
on the average growth rate of production and employment in SSI, though, it depicted that
globalisation had a positive impact on growth of SSI. Indian market started opening up
for foreign giants in 1991 and exposed the SSI to competition. The major challenges
faced are industrial sickness, non-availability of concessional loans, technological
upgradation, delayed payments which are revealed in the reduction of their overall
performance. The process of LPG opened up new avenues and challenges for the SSIs.
One fact cannot be denied that if government advertises its domestic products like khadi,
wool, gems, ornaments, silk etc world over the foreign countries would also rope in for
the ethnic items produced here. This step would help to enhance the foreign exchange
reserve of Indian economy. The government should channelize the latent skills and

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talents of people into business ideas and provide financial support to interested
individuals. Proper and adequate degree of globalisation can prove boost to Small Scale
Industrial growth of Indian economy.
METHODOLOGY
This paper is based on secondary study taken from the published research papers and
various resources like articles, books, economic surveys and also through various search
engines and throws light on various issues related to globalization.
DISCUSSION
Dr. V.V. Ghanekar stated that "the talk of globalization of economies and free trade will
remain insignificant as long as the developed countries do not enable the developing
countries easy access to marketing opportunities. Globalization means economic
globalization of economy of a country and it exert pressure on the government to become
more publicly accountable, competitive and responsive to citizens. The UN document
defines globalization as increased and intensified flows between countries. These flows
are of goods, services, capital, ideas, information and people, which produce national
cross-border integration of a number
Positive Effects of Globalizationof economic, social and cultural activities. The primary
objective of liberalization is to free from the restrictions on production, expansion and
following of rigid rules and regulations (Meenu, 2013).
There are some positive effects related with the process of globalization. In the education
field, some of the new communication and information technologies, which are of course
linked to the globalization process, have enabled students, researchers and young people
in distant and to access ideas and information from the best libraries in the world. They
are able to peruse through libraries in different countries without having to travel.
Globalization from this point of view assists people in the dissemination of values related
to knowledge, and in the promotion of values related to health care etc. Globalization has
made communication much easier and cheaper than before. The number of subscribers
and users of the Internet are now increasing remarkably.
The potential for people of different communities, countries, cultures and religions to
know and understand one another is greater than ever before. Knowing and
understanding each others are very important to promote and establish common values
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among people of different communities. Globalization also makes it possible for people
to demonstrate their sympathy and compassion for the victims of natural calamities and
man-made tragedies all over the world regardless of religions, lands, languages, colors,
cultures etc. (Muzaffar, 1998.)
Negative Effects of Globalization
Apart from some positive aspects of globalization, it has some important negative effects.
It affects almost all the aspects of human life. Globalization affects human cultures from
various perspectives. Globalization represents a challenge to cultural and local languages.
A United Nations study shows that half of local languages in the world are expected to
disappear. This could lead unenthusiastically to marginalizing many local cultures.
Scientific and economic superiority of the US and the flow of information technology
assist in imposing certain languages in particular English as a second language in some
developing and developed countries, and as a first language in some others. There is no
doubt that language has significant impact on cultures and, therefore, the dominance of
English could contribute to the emergence of a global and intercontinental culture which
may wipe out traditions, customs, and values of many societies and marginalizes their
cultures. Globalization has significant impact on local entities. Its complexity takes
decisive dimensions in particular with regard to its effects on labor immigration from the
South to the North. In many cases this problem not only has political reflections, but also
social dimensions. For example, when the Algerian football player Zinedine Zidane has
appeared as a star in the French team in World Cup 1998, French Right Wing started to
criticize the presence of non-aboriginal French in the national team (Mittelman, 2000). At
the same time, Algerians in both France and Algeria were so pleased and looked at
Zinedine Zidane as an Algerian hero, despite the fact that he was born in France and still
resides there. So, globalization in this sense is reshaping the identity of many people
particularly migrants.
All these negative aspects of globalization pose real challenges not only to many
developing countries as usually emphasizes, but also to all human beings who should, if
they have to manage these problems, inject religious, ethical and moral considerations,
activities and objectives associated with the globalization process. Indeed, people should

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globalize themselves within the religious sphere and the common values to build a more
just world to live in.
CONCLUSION
The process of globalization is not new. The globalization of the political, economical
and social structures happened in all ages. However, today with the advent of information
technology, newer means of communication have made the world a very small place. Not
only the pace of the globalization process, but the penetration and integration of the
changes that are induced in our day to day life has made the impact of globalization many
fold higher. With this process, the world has become one huge market place. We must
not, nevertheless, miss the opportunities that the global system can offer. An eminent
critic put up a point that, the world cannot marginalize India, but India, if it chooses, can
marginalize itself. We must guard ourselves against this danger. More than many other
developing countries, India is in a position to wrest significant gains from globalization.
However, we must voice our concerns and in cooperation with other developing countries
modify the international trading arrangements to take care of the special needs of such
countries. At the same time, we must identify and strengthen our comparative
advantages. It is this two-fold approach which will enable us to meet the challenges of
globalization which may be the defining characteristic of the new millennium
Looking at such positive and negative impacts of globalization, it can be said that, very
soon India will overcome these hurdles too and will march strongly on the path of
development.

REFRENCES
1. Agarwal, S. and Goel, R. (2014). Impact of Globalisation on Small Scale Industries in
India. Global Journal For Research Analysis. 3(5): 19-20.
2. Jindal, J. (2013). Globalization - It’s Socio-Economic Impact in India. International
Journal of Emerging Research in Management &Technology. 2(12): 41-43.
3. Lee, E. and Marco, V. (2006). The social impact of globalization in the developing
countries. IZA Discussion Papers, No. 1925.

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4. Meenu (2013). Impact of Globalisation and Liberalization on Indian Administration.

International Journal of Marketing, Financial Services & Management Research. 2(9):
120-125.
5. Micklethwait, J. and Wooldridge, A. (2001). The Globalization Backlash, Foreign
Policy. JSTOR. 126: 16-26.
6. Singh, S. (2012). Globalization and it’s Impact on Indian Economy. Arth Prabhand: A
Journal of Economics and Management. 1(1): 37-47.
7. Mittelman, J.H. (2000). The Globalization Syndrome: Transformation and Resistance.
Princeton University Press, 41, William Street, Princeton, New Jersey – 08540
(Publisher).
8. Muzaffar, C. (1998). Globalization and Religion: Some Reflections in Globalization:
The Perspectives and Experiences of the Religious Traditions of Asia Pacific.
(Camilleri and Muzaffar (Eds.).

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HR126
Impact Of Leadership On E-Governance In India

Poonam Salwan*, Dr. Veerpaul Kaur Maan**

*Research Scholar, PunjabTechnicalUniversity, Jalandhar, Punjab, [email protected]

** A.P in GianiZailSinghPunjabTechnicalUniversity,Bathinda, Punjab. [email protected]

Abstract: Electronic (e)- Governance has been implemented all around the world to
make the government more responsible and accountable towards the citizen’s welfare.
The advancement of ICT has tried to transform the relationship between citizens and
government to implement e-Governance projects efficiently. However, these projects
have failed to achieve the success due to many soft issues like e-readiness, lack of funds
or the socio-economic-political reasons. This paper studies one such core factor-
Leadership. It highlights how Leadership affects the socio-economic-political conditions
of the country as well as international trades and treaties that further results in an
acceleration of e-governance projects.

1. Introduction: The keyword e-Governance means a process of delivering govt.

services and exchange of information between govt. and citizens electronically. The letter
‘e’ throws various shades of responsibilities like an effective, efficient govt, empowering
citizens along with the economic-social conditions of the country and the letter ‘Gov’
offers fast and timely services for the citizens. ICT helps the govt. to support their
responsibilities like G2G, G2B, G2C to achieve socio-economic-political goals.
However, ICT development is also highly affected by the leadership, nature and behavior
of govt-citizens and their acceptability that results in the poor progress of e-governance
projects. Thus leadership has been considered as one of the major factor for e-
governance. The main objective of this paper is to highlight the importance of strong
leadership and its role in the success & growth of e-governance.

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2. Review of Literature: The review of literature reveals that the e-governance is not all
about computerization of government records. Rather, it is a mean to serve the citizens by
controlling the government and making them accountable.

E-governance needs domain experts who are skilled in governance, IT experts,

constitution experts, state and center governments who are in need to work together for
good governance.

Even center & state governments have provided various e-governance plans and agencies
like NeGA(National e-Governance Agency), SDC(State Data Centers), CSC(Common
Service Center),SWAN (State Wide Area Network), PMU(Program Management Unit),
SeMT(State e-governance Mission Team). There are some states like (A.P, M.P,
Karnataka, Maharashtra) who have implemented e-governance projects successfully and
that has also effected the growth rate of income, literacy and education. Other states like
Jammu & Kashmir are lagging behind due to various socio-ecomonic-political reasons.

One such important issue is politics. There are some political parties who are denying the
e-governance projects to ensure their vote banks as they have pretended that these
projects will lead to unemployment, low per capita income etc. Thus results as
undeveloped states. While other states that have a stable govt with strong leadership have
implemented e-governance projects, are showing significant increase in the ratio of per
capita income, infrastructural growth and rest are still socially-economically and
politically backward states. Under the light of this, present paper studies the impact of
leadership on the growth of India.

3. Objectives: The main objectives of this paper are as follows:

1. To study the growth of e-Governance in India

2. To study the impact of leadership on the growth

4. Research Methodology: To study these objectives, Analytical method has been used
where data about the growth of e-Governance in India and role of leadership in the
progress of e-Governance has been collected and compared.

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5. Source of Data: To study the above objectives, secondary data has been collected from
various journals, govt websites and newspapers to check the overall development of e-governance
projects.

6. Case Study:

6.1 E-Governance in India: History of e-governance: In India, e-governance was introduced

during 1970s with more emphasis on ‘e’ i.e computerization of all the govt, departments. Various
organizations have been made like National Informatics Center(NIC), CSC, NeGA, NeGP, CIS,
DIS etc. But more or less all the public departments were confined to their own branch’s
connectivity. Later on, Indian govt. enacted ICT act to develop and promote e-governance
projects nationwide.

6.2 Tools for Reformation: Like other developing countries, Indian govt. has been trying hard to
reform their processes to encourage e-governance like:

 Establishing dedicated center level organizations for the research projects and development
of e-governance like NIC, NeGA, CSC, CDAC
 Establishing various state level organizations to co-ordinate and develop e-governance in
respective states
 Enactment of ICT Act (during 1990s), to develop communication nationwide
 Making IT Act(during yr. 2000) to protect transactions (data) from intentional / unintentional
loss or theft
 Passing of RTI Act(during yr. 2005) to encourage the citizens and to make public agencies
more accountable and responsible
 Funds and subsidies to various e-governance projects
 Encouraging private sector to participate and invest money in e-governance projects through
PPP.
 Incorporating the services from Technical Experts
 Encouraging International trades and treaties with various countries and World bank to help
and support e-governance.

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The international studies on the ‘Maturity

Model of e-Government’ done by various researchers like Layne and Lee, Andersen and
Henriksen, Gartner, World Bank etc stated the below mentioned stages of e-government
development:

 Web Presence/ Informative

 Transaction / Information / Interaction between citizens and govt
 Vertical Integration (services and financial transactions on the web)
 Horizontal Integration(integration of services / interoperability)

With respect to the above maturity model, India has completed its two phases i.e automation and
real-time interaction through search engines, downloading e-mails and documents. Now India is
passing through 3rd stage of maturity model i.e complete transactions (vertical integration) where
a user can buy and sell things through cards.

The next fourth stage refers to interoperability among organizations. It is also known as
Horizontal integration where the govt and all the organizations could use and exchange the
meaningful data among themselves through ICT.

6.3 Implementation and Status of E-Governance Projects: Special e-governance organizations

like CSC, CDAC, NIC, NeGA etc are taking the help of IT experts. They are trying to collaborate
the needs and requirements of various center and state level ministries like PM office, Ministry of
Home Affairs, Ministry of Finance, Ministry of Cultural Youth and Sports, Ministry of Defense,
Ministry of Communication, Ministry of Human Resource Development and Ministry of Foreign
Affairs etc.

All the depts. were asked to specify their basic requirements, expectations and prepare a proposal
for the respective IT projects. Then e-governance agencies and IT experts followed the tender
procedures to complete the projects with due considerations of their needs and specifications. The
website details of these portfolios are as follows:

S.No Portfolios Website

1. PM office http://pmindia.gov.in/en/
2. Ministry of http://www.mha.nic.in/

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Home Affairs
3. Ministry of http://finmin.nic.in/
Finance
4. Ministry of http://www.indiaculture.nic.i
Cultural Youth n/
and Sports
5. Ministry of http://www.mod.nic.in/
Defense
6. Ministry of http://www.dot.gov.in/
Communication
7. Ministry of http://mhrd.gov.in/
Human
Resource
Development
8. Ministry of http://www.mea.gov.in/
Foreign Affairs

6.4 Impact of New Leadership on the E-Governance:

Since the new govt. has come into power, there have been a few changes in the functionality of
the administration. It emphasis on “less government and more governance”. Various efforts like
making the ministers more punctual, responsible and accountable which results in speedy
decisions and clearance of stalled projects, on-line clearance of individual projects on
environment & forest clearance, amendment in labor law and allocation of funds for the
manufactures are generating a lots of hope and enthusiasm among corporate sector and investors.

Let us understand the progress made by India under Mr. Modi’s leadership during year 2014-
2015:

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a) Investments on Social Sector: The percentage spending of GDP on social sector was falling
since 2010 in India. But Narendra Modi has tried to increase the percentage spending of
GDP(chart-I) to help and support the social sector like health, education etc.

4
3.5
3
2.5
2
1.5
1
0.5
0
2010-2011 2011-2012 2012-2013 2013-2014 2014-2015 2015-2016

Social sector spending(excluding food subsidy)

Social sector spending(Including food subsidy)

chart-I

The analysis of chart-I reveals investments on social sector has been increasing under Modi’s
leadership. Moreover, the recent launch of three social security schemes—the Pradhan Mantri
Suraksha Bima Yojana, Pradhan Mantri Jeevan Jyoti Yojana and Atal Pension Yojana—that seek
to provide accidental death and disability risk cover, life insurance and contributory pension are
the major steps towards increasing social security by private sectors in India, data has studied
from year 2004-2016.

b) Encouragement to Private Sector: In order to study the investments made

3500

3000

2500

2000

1500

1000

500

0
2004-05 2005-06 2006-07 2007-08 2009-10 2010-11 2011-12 2012-13 2013-14 2014-15 2015-16

chart-II

The study (chart-II) reveals that the private sector has shown his faith in Mr. Modi’s leadership
and shows significant growth by initiating new projects in India and by investing more money in
old projects. Moreover, encouragement to PPP, custom duty relief to energy sector, building
smart cities, digitizing rural India, implementing metro infrastructure in some cities are a few
positive factors responsible for the growth of India shows the basic traits of Mr. Modi’s
leadership.

c) More Fiscal Autonomy to States: The chart-III reveals that after continuous declines for a
decade, central government has managed to transfer upto 74% of untied shares of Union taxes to
state governments under Modi’s leadership.

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80
70
60
50
40
30
20
10
0
2005-06 2006-07 2007-08 2008-09 2009-10 2010-11 2011-12 2012-13 2013-14 2014-15 2015-16

chart-III

Although the 14th Finance Commission has recommended that 42% of Union taxes be shifted to
the states, the degree of fiscal autonomy enjoyed by the states currently is still lower than what it
was a decade ago.

d) Foreign Visits: In order to develop healthy relationships with other countries, Mr. Modi has
travelled 28 times around the world to invite the investors to invest money in India. According to
the data, Mr. Modi has travelled 28 times outside India on state visits or on International summits.
Mr. Modi is also emphasizing on Indigenize the products by appealing “Come, Make In India” to
investors.

30

25

20

15

10

Narendra Modi Manmohan Singh Manmohan Singh

chart-IV

As indicated in chart-IV, Mr. Modi has tried to attract international investors far more than
former prime minister Manmohan Singh, who travelled an average of 6.8 times a year in his first
term and an average of five times in his second term.

e) Digital India - One-Stop Shop: The Digital India project is a very ambitious project. It aims to
provide all the government services under one umbrella i.e. to integrate all the govt. departments
and make all the government services available to citizens electronically thus reducing the paper
work and providing quick services to all the citizens. This project requires rich infrastructure
along with high speed internet networks to connect rural areas. It is based on public private
partnership (PPP) and is expected to generate lots of employment in India. A lot of MNCs are
also joining hands with the government to complete this project.

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The govt. of India under the leadership of Mr. Modi has dreamt to complete this project to fasten
the pace of e-governance in India. This project is expected to be completed by 2019.

Some other projects that stand in a row to fasten the pace of e-governance in India are Digital
Locker, e-education and e-health.

7. Findings: Although, judging a government on the basis of only 18 months tenure is not
justiciable. But govt. has shown positive results towards the socio-economic-political growth of
India under Mr. Modi’s leadership.

Investing more share of GDP on social sector will definitely show significant growth of increased
rate of literacy, good health etc. By increasing the share of states in Union taxes, Mr. Modi has
shown his approach by helping the states to improves their standard of living, per capita income,
infrastructure etc through encouraging more opportunities of employments. His continuous visits
to neighboring and foreign countries, encouraging Indians to invest money in India, providing
various tax relaxations to private investors of India are the few steps that will accelerate the socio-
economic-political growth of India. Thus, India is showing significant growth in the socio-
economic-political factors under Mr. Modi’s leadership.

Moreover, initiation of Digital India-One Stop Shop project, Digital Locker, e-education and e-
health are such ambitious projects that will give new wings to e-Governance to fly in coming
years. All administrative services will come under one umbrella with more transparency,
accountability and directly accessible by the citizens of

India. Thus, India is showing continuous growth of e-Governance under Mr. Modi’s leadership.

8. Conclusion: The performance of new govt. under Mr. Modi’s leadership has no doubt
encouraged the investors and has shown new hopes among citizens. The govt. is taking small
steps towards the fundamental changes. Once those changes will come into action, they may
have far more reaching effects on economy and will encourage good governance.

9. References:

1. http://www.ijcaonline.org › Archives › Volume 44 › Number 14

2. http://www.jatit.org/volumes/research-papers/Vol17No1/5Vol17No1.pdf

3.www.ras.sagepub.com/content/68/2/231.refs

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4. www.indiaegov.org/knowledgeexchg / egov_strategy.pdf,E-Governance Strategy in India ,

Sachdeva Sameer

5. http://www.hss.iitm.ac.in/rt-ppp/PPPs/ Presentations/ PPP%20for% 20accelera

ted%20Infrastructure%20dvlpt%20in%20India.pdf

6.http://rbidocs.rbi.org.in/rdocs /Content/ PDFs/ppp1.pdf

7.http://en.wikipedia.org/wiki/Public%E2 %80%93private_partnership

8.www.rbi.org.in/scripts/BS_VIEWCon tent.aspx?ID=1912

9.http://www.pppindiadatabase.com/ Uploads/Status%20of%20 PPP %20 Projects%20 as%20

on%20July %2031 ,%202011 .pdf

10.http://www.pppindiadatabase.com/ Uploads/Master%20List%20PPP%20
Projects%20in%20India%20as%20 on%20 Janu ary %2031,2011.pdf

11.http://www.economist.com/news/finance-and-economics/21568397-indias-love-affair-public-
private-partnerships-faces-stern-test-rippp

12.http://en.wikipedia.org/wiki/List_of_Indian_states_by_GDP,

13.http://en.wikipedia.org/wiki/Indian_states_ranking_by_literacy_rate,Indian states
ranking by literacy rate, by National Family Health Survey

14. http://en.wikipedia.org/wiki/Poverty_ in_India#Reserve_Bank_of_India_.282012.29.

15. Heeks Richard, Understanding e-Government for Development,
http://www.iimahd.ernet.in/egov/ifip/, dec2001/article3.htm

16. Plan of Action E-Government for Development,

www.itu.int/wsis/docs/background/themes/egov/action_plan_it_un.doc, May 2002

17. e-Government Implementation and Leadership – the Brunei Case Study,

www.ejeg.com/issue/download.html?idArticle=198, 2009

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18. Case Study: Impact of Leadership on Governance in Public Administration

www.ejeg.com/issue/download.html?idArticle=198 www.ejeg.com 2009

e-Government
Implementation
and Leadership
– the Brunei
Case Study
https://www.academia.edu/4987708/Case_Study_Impact_of ----- ------
Case Study: Impact

_Leadership_on_Governance_in_Public_Administration of Leadership on
Governance in
Public
Administration

http://www.quora.com/What-exactly-is-the-Narendra-Modi- National level Analysis of

Development-Model-of-Gujarat surveys of GSDP Modiz project n
work in Gujrat
http://www.quora.com/What-are-the-good-things-that- Implementing E- Modiz model of
Narendra-Modi-has-done-for-Gujarat Governance, e- Gujrat
services
http://www.cgg.gov.in/workingpapers/eGovPaperARC.pdf Using e-Tools
for Good
Governance &
Administrative
Reforms

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MRKT145
Consumers’ Attitude towards Pricing of Green Products: An
Empirical Study in Himachal Pradesh

Dr. Sachin Kumar#1 & Dr. Rajesh Kumar#2

#1
Assistant Professor
University Business School,
Himachal Pradesh University,
Regional Centre, Dharamshala, Khaniara,
Himachal Pradesh, India
E-mail ID: [email protected]
Contact: +91-8988156444

#2
Associate Professor
Chitkara Business School
Chitkara University, Punjab Campus
Rajpura, Punjab, India
E-mail ID: [email protected]
Contact: +91-9459333478

Abstract

Green marketing is a marketing philosophy that promotes production and selling of pure (eco-
friendly) products with protection of ecological balance. Modern age customers are showing concern
towards the global warming and degrading quality of the environment. The awareness regarding the
green products has increased among the consumers and they are ready to spend money to purchase
green products. This research empirically examines the attitude of customers towards the pricing of
green products in Himachal Pradesh.Himachal Pradesh stands at top among all the North Indian
states according to literacy rate, so it was assumed that people are more aware regarding the green
products in the state. Therefore, an attempt is made in this study to analyze the intentions of the
consumers to purchase the green products in accordance to price. The research findings revealed that
there is a significant difference among different income groups for buying green products, even if the
price is higher than non-green counterparts. The male and females and people with different income
groups were found insignificantly different in their opinion about that a price hike of green products
is due to environmental benefits added.

Keywords:Green marketing, pricing, green products, environmental benefits

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Consumers’ Attitude towards Pricing of Green Products: An

Empirical Study in Himachal Pradesh
1. Introduction

With change in people’s taste, preferences and fashion, the attitude is changing from
traditional life style to green. The term green is itself concerned about environmental
protection. Protection of the earth and environment is one of the main challenge and focus of
the decade. Indians are incorporating environmental concern in their lifestyle. Even the
companies are not behind and integrating this untouched aspect of marketing in their
business planning. Green marketing has become inevitable part of the business strategy in
this modern era.
The banking, retail, automobile, electronics, cement, paint, FMCG, energy, transportation,
telecom sector and others are practicing Green Marketing. These industries and sectors
believe in reducing, reusing and recycling the waste materials and the old products. The Surf
Excel detergent advertising “do bucket paani roz bachana", CFL bulbs from Philips, Nerolac
leadless paints, and the energy-saving LG consumer durables are examples of Green
Marketing.
The products under Green Marketing are supposed to be of higher prices. But it is believed
that irrespective of higher prices people prefer buying these green products. Price is the most
important attributes in determining the customer value of different products (Kaenzig et al
2013). Consumers can pay up to 5% extra for a product that is environmentally friendly
(Miller, 1990).
Himachal Pradesh is also working ahead for environment protection. The plastic bags are
banned in the state and government too is taking the necessary and timely initiatives in this
regard. People from all over the world including Himachal Pradesh are willing to buy the
environmentally friendly and health caring products. The marketers must think beyond the
traditional value added products because consumers are becoming sensitive to the need of
switching to green products.
Green marketing

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The growth of the green marketing research dates back to 80s when green marketing concept
had emerged. With time the consumers have become aware of the rising problem of
environment and are adopting a green lifestyle and health constraint measures, so that the
harmful impact on the environment can be reduced (Jacob, 2012). It evolved in three phases,
namely: ecological marketing, environmental marketing and sustainability.
It’s not only the environmental aspect that must be considered, but the optimum utilization
of resources, charging a fair price, and transparency to the customers can never be neglected.
The customers develop their attitude and orientations towards the companies on the basis of
price charged. This price hike in the name of environmental benefits adds a value to the
product or not is a new area of study.

2. Review of Literature

Calif (2010) took into consideration the press release by monthly green confidence index
(www.greenconfidenceindex.com) said that consumers from U.S. cite price as the main factor
for not buying the green products. The price issue was considered while purchasing, and
people expect that the price should be lower.
Dale (2008) revealed that high energy prices are driving some entrepreneurs to devise ways
to use more renewable sources or come up with energy-saving manufacturing practices.
Consumers can even pay a premium for environmentally friendly products.
Eco awareness spurs green choices among consumers. (n.d.) the report argued that
Consumers are increasingly choosing to buy green. There are 64 percent of Indian consumers
who, during their next purchase are planning to spend more on green products. 48 percent of
Indian consumers are willing to pay 10% more on the green products. The cost consideration
of the consumers is always associated with their purchase. People think that the less
accessibility and higher price of green products make them to see green as a luxury purchase.
Kauffman (2011) said that people can purchase green products made from considerably less
elements, but it will cost ten times more than purchasing a traditional non-green counterpart.
The higher price of green products controls customers’ ability to buy them
(Moosnews, 2011) Moosnews is an official blog of Fatcow web hosting. All the websites
hosted at FatCow are powered by 100% wind energy. According to a report on Moosnews,
Green marketing targeted a niche audience in its initial stage. Then in the 80s and 90s, it

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slowly gained momentum. The website strongly implies that the marketers can employ green
marketing techniques by learning, from the success stories of the successful companies.
The pricing of the products (green or conventional) matters a lot for sale of products. On one
side most of the companies are claiming for delivery of the green products and at the same
time charging huge funds from the customers in the name of Eco-friendly is a matter of
concern. It might affect the budget of the families, on the name of Green and eco-friendly
products. So this study will find out is there any extra burden caused by premium pricing of
green products on the budget of the customers?

3. Objective and Hypothesis of the Study:

 To examine the attitude of the consumers towards the pricing of green products
in Himachal Pradesh

Hypothesis of study
 H01: There is no significant difference among different income groups for
buying green products, even if the price is higher than non-green counterparts
 H02: There is no significant difference among different gender for buying green
products, even if the price is higher than non-green counterparts
 H03: There is no significant difference among different income groups that price
hike of green products is due to environmental benefits added
 H04: There is no significant difference among different gender that price hike of
green products is due to environmental benefits added

4. Research Methodology:

The present study is based on both the primary as well as secondary data. Respondents
have been collected purposively from Himachal Pradesh. A self-structured
questionnaire was framed in order to collect the data from respondents. The
questionnaire consists of 10 statements on 5 point Likert scale from strongly disagree to
strongly agree. The questionnaire was mailed to the respondents with the help of
Google drive. In the first phase 70 people were contacted, out of which 47 respondents
reverted back. In the second phase 70 more respondents were mailed the questionnaire
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and 59 among them reverted. Among these 106 respondents 100 responses were
selected for the analysis.
Data Analysis tools
SPSS 20 version has been used to analyze the data. Statistical tools like T-test and
Anova have been used to justify the hypothesis of the study.

5. Results and Analysis

Table 5.1
Respondents Personal Information
Age in years Frequency Percentage
Less than 25 66 66%
25-50 31 31%
Above 50 3 3%
Total 100 100%
Gender
Male 70 70%
Female 30 30%
Total 100 100%
Income
Less Than 5 Lac 72 72%
5 to 10 Lac 28 28%
More Than 10 Lac 0 0%
Total 100 100
Source: Primary data

Table 5.2
Reliability Statistics
Cronbach's Alpha N of Items
0.671 10
Source: Primary data

The table 5.2 shows the value of Chronbach’s Alpha which is 0.671. This value is nearer to
the minimum value accepted for the reliability. Thus the scale is reliable and can be
considered for research.

Table 5.3
ANOVA
It is worthy to buy green products even if the price is higher
Sum of Squares df Mean Square F Sig.
Between Groups 10.879 2 5.439 5.282 0.010
Within Groups 35.013 97 1.030
Total 45.892 99

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Source: Primary data

The tables 5.3 indicate the Univariate Anova Analysis for comparing the mean difference
between Income Levels and buying green products as the price of green products is higher.
The results show that there is a significant difference in the attitude of people with different
income groups to buy green products if the price is higher, F (2, 97) = 5.282, p<0.010.
Hence, alternate Hypothesis is accepted that there is a significant difference among different
income groups for buying greener products as the price is higher than non-green counterparts.

Table 5.4

Group Statistics
Gender N Mean Std. Deviation Std. Error Mean Sig. Value
It is worthy to buy male 70 3.53 1.046 0.125 0.032
green products even if
the price is higher female 30 3.80 1.064 0.194

The tables 5.4 shows the results of t- test for comparing the mean between genders and
worthy to buy green products even if the price is higher. There are 70 males and 30 females
in the sample. The degree of freedom for t test is 8.652, significant 0.032. The alternate
hypothesis is accepted. Thus, it has been verified that there is a significant difference among
male and female that it is worthy to buy green products even if the price is higher.

Table 5.5

ANOVA
Price hike of green products is due to environmental benefits added
Sum of Squares df Mean Square F Sig.
Between Groups 3.708 2 1.854 1.211 0.302
Within Groups 148.482 97 1.531
Total 152.190 99

The tables 5.5 indicate the Univariate Anova Analysis for comparing the mean difference
between Income Levels and the price hike of green products is due to environmental benefits
added. The results show that there is no significant difference in the attitude of people with
different income groups to buy green products if the price is higher, F (2, 97) = 1.211, p=
0.302.

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Hence, null hypothesis is accepted that there is no significant difference among different
income groups for buying greener products as the price hike of green products is due to
environmental benefits added.

Table 5.6

Group Statistics
Gender of N Mean Std. Std. Error Sig. Value
respondents Deviation Mean
The price hike of green products Male 70 3.13 1.196 0.218
is due to environmental benefits 0.394
Female 30 3.57 1.272 0.481
added
Source: Primary data

The table 5.6 shows the results of t-test for comparing the mean between genders and price
hike of green products is due to environmental benefits added. There are 70 males and 30
females in the sample. The Levene's Test for Equality of Variances is not significant 0.394.
The alternate hypothesis is rejected. Thus, it has been verified that there is no significant
difference among male and female that price hike of green products is due to environmental
benefits added.

Table 5.7: Results

S.
Hypothesis Accepted/Rejected
No.
H01 There is no significant difference among different income groups
for buying green products, as the price is higher than non-green Rejected
counterparts
H02 There is no significant difference among different genders for
buying green products as the price is higher than non-green Rejected
counterparts
H03 There is no significant difference among different income groups
that price hike of green products is due to environmental benefits Accepted
added
H04 There is no significant difference among different genders that
price hike of green products is due to environmental benefits Accepted
added

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6. Conclusion
The research findings revealed that there is a significant difference among different income
groups for buying green products, even if the price is higher than non-green counterparts. The
male and females and people with different income groups were found insignificantly
different in their opinion about that a price hike of green products is due to environmental
benefits added. In general it could be concluded from the study that people have positive
attitude towards the green products and they want to purchase green products, but if people
don’t know the reality behind why green products are priced at a premium, it will hinder their
response to buying. The rise in awareness can increase the sales. So, it’s suggested to
marketers to use more and more campaigns about reasons to hike in price of eco-friendly
products. These campaigns should strictly claim that hike in price is due to environmental
and health benefits added.
References:

1. Anderson, R. C., & Hansen, E. N. (2004). The impact of environmental certification

on preferences for wood furniture: A conjoint analysis approach. Forest Products
Journal, 54(3), 42-50.
2. Calif, O. (2010). Price, Performance Are Biggest Barriers To Increase Purchases Of
Green Products, Says Monthly Indicator. Green Buz Group. Accessed through
http://www.greenbizgroup.com/press/2010/5/%2024/price-performance-are-biggest-
barriers-increase-purchases-green-products-says
3. Dale, A. (2008). Enterprise: green products gain from new price equation; they find
new buyers as high energy costs hurt regular brands. Wall Street Journal.
online.wsj.com. Accessed through
http://online.wsj.com/article/SB121425785415998071.html
4. Dutta, K., Umashankar, V., Choi, G., & Parsa, H. G. (2008). A comparative study of
consumers' green practice orientation in India and the United States: A study from the
restaurant industry. Journal of Foodservice Business Research,11(3), 269-285.
5. Eco awareness spurs green choices among consumers.: mxmindia.com media
marketing more. Accessed through http://www.mxmindia.com/2011/09/eco-
awareness-spurs-green-choices-among-consumers-2/
6. Cherian, J., & Jacob, J. (2012). Green marketing: A study of consumers’ attitude
towards environment friendly products. Asian Social Science, 8(12), 117-126.
7. Kaenzig, J., Heinzle, S. L., & Wüstenhagen, R. (2013). Whatever the customer wants,
the customer gets? Exploring the gap between consumer preferences and default
electricity products in Germany. Energy Policy, 53, 311-322.
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MRKT146
SUPPLY CHAIN MANAGEMENT: An Overview
*Dr. Suman Kathuria, **Puneet Bansal, ***Rupani

*Assistant Professor, GZSCCET, Bathinda,[email protected]

** Assistant Professor, GZSCCET, Bathinda, [email protected]
*** Research Scholor, SLIET, Longowal, [email protected]

ABSTRACT:
Supply (chain) management is ultimately about influencing behaviour in particular directions
and in particular ways. The underlying logics, drivers, enablers and barriers merit and require
close attention [1]. Supply (chain) management is ultimately about influencing behavior in
particular directions and in particular ways. SCM is the management of upstream and
downstream relationships in order to deliver superior customer value at less cost to the supply
chain as a whole.[2] In order to achieve this coordination/integration of all the links in the
supply chain, information is critical. Recent technological developments in information
systems and information technologies have the potential to facilitate this coordination, and
this, in turn, allows the virtual integration of the entire supply chain. The purpose of this
paper is to insight the overview of SCM and its integration with technology

KEYWORDS: Supply chain management, Suppliers, Strategic management

INTRODUCTION
“Supply management” can be viewed as both an emergent field of practice and an emerging
academic domain. This paper examines the relationship between supply chain management
process maturity and performance, and provides a supply chain management process maturity
model for enhanced supply chain performance [3]. SCM has been widely researched in
numerous application domains during the last decade. Despite the popularity of SCM
research and applications, considerable confusion remains as to its meaning. There are
several attempts made by researchers and practitioners to appropriately define SCM [4]

SCM assists the business organization to compete in the dynamic international market. The
objective of SCM is to incorporate activities across and within organizations for providing
the customer value. This should also be applicable to the academia, which represents a type
of non-profit organizations. The goal is to provide the society value by producing high
quality graduates and research outcomes. An integrated educational supply chain involves
coordination and information sharing up and down the process among all stakeholders. With
technology facilitating information flow, a coordinated supply chain can be designed to meet

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the strategic, planning, and operating objectives of the educational institutions. It also means
establishing effective and feasible relationships both inside and outside the organization [4]

SCM AND INTERNET

The Internet can have three main impacts on the supply chain. One of the most covered topics
in the literature is the impact of e-commerce, which refers mainly to how companies can
respond to the challenges posed by the Internet on the fulfilment of goods sold through the
net. Another impact refers to information sharing, how the Internet can be used as a medium
to access and transmit information among supply chain partners. However, the Internet not
only enables supply chain partners to access and share information, but also to access data
analysis and modelling to jointly make a better planning and decision making. This jointly
planning and decision making is the third type of impact of the Internet on SCM and we refer
to it as knowledge sharing. e-SCM is defined as the impact that the Internet has on the
integration of key business processes from end user through original suppliers that provides
products, services, and information that add value for customers and other stakeholders [2]

SCOPE OF SCM
SCM is needed for various reasons: improving operations, better outsourcing, increasing
profits, enhancing customer satisfaction, generating quality outcomes, tackling competitive
pressures, increasing globalization, increasing importance of E-commerce, and growing
complexity of supply chains. Supply chains are relatively easy to define for manufacturing
industries, where each participant in the chain receives inputs from a set of suppliers,
processes those inputs, and delivers them to a different set of customers. With educational
institutions, one of the primary suppliers of process inputs is customers themselves, who
provide their bodies, minds, belongings, or knowledge as inputs to the service processes. This
examining study reveals the following objectives- Analysis the overview of SCM through
different citations and the evolution of SCM and Presentation of ITESCM as SCM practices
on tertiary educational institutions

ERP IN SCM
The integration of Supply chain management and ERP allows manufacturing and distribution
businesses the ability to gain greater visibility into all operations while increasing speed,
efficiency and overall customer satisfaction.[6]The feature-rich working environment of ERP
combined with the more streamlined and efficient workflow of an effective SCM can provide
a range of important advantages, including:

 Improved efficiency across multiple departments and organizations working within

the supply chain

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 Improved customer service for increased customer retention and greater chance of
repeat business opportunities
 Automation of workflow for reduced overhead and operational costs
 IT issues and problems that are less likely to create bottlenecks to impede efficiency
 More flexible supply chain solutions that may be readily adapted to meet the needs of
changing circumstances or future business growth and expansion

CONCLUSION
Supply chain management in the modern era is totally dependent on technology without
which the customer satisfaction can not be achieved. We live in the perfect competitive
market, as per economic terms, so we can not be so lenient with this great part of the business
that is supply chain management. To survive in the competitive market one should have the
technology up to date to tackle the rival substitution. Enterprise resource planning is the
great support to supply chain management, as it makes the world small by the way of
integration with various domestic as well as foreign locations.

REFERENCES
1. Supply chain management: theory, practice and future challenges John Storey and
Caroline EmbersonIJOPM 26,7-754.
2. e-Supply Chain Management: review, implications and directions for future research,
Cristina Giménez.
3. https://www.researchgate.net/publication/239636903_The_development_of_a_supply
_chain_management_process_maturity_model_using_the_concepts_of_business_proc
ess_orientation .
4. Habib, M. (2014) Supply Chain Management (SCM): Its Future Implications. Open
Journal of Social Sciences, 2, 238-246
5. Habib, M.M. (2011) Supply Chain Management (SCM): Theory and Evolution.
Supply Chain Management, Applications and Simulations. InTech Open Access,
Croatia, September 2011. AND Sampson, S.E. (2000) Customer-supplier duality and
bidirectional supply chains in service organization. International Journal of Service
Industry Management, 11, 348-364
6. http://www.compudata.com/the-role-of-erp-in-supply-chain-management/

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MRKT137
VIRAL MARKETING THROUGH INTERNET: THE UNIQUE
WAY OF MARKETING
*Gurpreet Singh
*Assistant Professor, Punjab Institute of Technology, Nandgarh (Bathinda)
*Email:[email protected], *Mobile No- 8288825192

ABSTRACT
From time to time, marketers have concentrated on adopting various marketing techniques to
attract consumers. Viral Marketing through internet is one such approach which breaks the
traditional brick-and-mortar model of marketing. While the popular seeding approach is
known to spread the marketing word, this paper will focus on to identify scenario of viral
marketing. To substantiate this study, a strategic model will be created so that the prospective
customers can be targeted the right way on an online forum. There is clearly more to explore
from the perspective of viral marketing to enhance the experience of customers about the
online media. This paper focuses on the concept of viral marketing as a tool to influence
consumer’s purchasing decisions which positively, may impact on sales by approaching new
consumers through a strategic approach.
Keywords: Viral Marketing, Online Media, BuyingBehavior, Marketing Strategy.

1. INTRODUCTION
Viral Marketing is the word today, that is used to describe the revolutionary way by which
any information ,proliferates across a million people rapidly within a short period of time
.Marketers are now increasingly looking forward to tap this opportunity to deliver any kind
of a marketing message because of its ability to make it contagious. If Viral Marketing is so
easy and uncomplicated, then why is it that not every product or service is marketed the same
way? It has further been seen in the past that all such marketing campaigns have not been
always successful, barring some exceptions. The latest among them was the success of
„Kolaveri track video‟ which caught the attention of millions of people around the globe.
Hence, we will look at some of the factors that directly impact the implementation of Viral
Marketing campaigns and how they, in turn, play a role in creating perhaps, positive sales for
any product or service. Nevertheless, internet is the most preferred mode for thisand hence
this entire paper will confine its analysis to online Viral Marketing.The complexity of Viral

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Marketing campaigns arises from understanding how consumers react or respond to online
marketing messages. Hence, it is extremely important to tap the right kind of consumer
behavior and attitude to leverage the opportunities available with the marketers. This begins
with delivering the right kind of messages, capturing the positive response from the
consumers and most importantly, retaining them while expanding the current customer base.
Communicating the right message at the right time to the right person is the key to a
successful marketing campaign; hence it is important to ensure that the message is effective
enough to trigger a positive consumer response. This is the most crucial aspect of such online
campaigns because any kind of a negative response spreads faster than a positive response. It
is therefore very necessary for marketers to make a prudent choice of words before engaging
in conversations with the prospective consumers.

In view of this, there would be an analysis of how the perception and attitude of consumers
play an important role in determining the success of any online advertising that is viral. This
is turn , we believe will bring out not only marketing insights but also relevant ideas on how
to deliver the right kind of online messages to target prospective customers .To take this
forward into a research study, the focus would mainly be on the survey results that would be
used to examine the factors responsible for this. Using this as the base, a strategic model
would be developed to propose a suitable method of effectively utilizing the online tools to
build up a campaign suitable to trigger positive buying behavior in the minds of the
customers. While a positive word of mouth is always the key to a successful marketing
strategy, the recent online media marketing has opened gateways to much more than that and
hence it is important to understand the mechanism of factors that play an important role in
influencing consumer behavior.

2. LITERATURE REVIEW
The advent of social networks, online communities and chat provide the ability to distribute
information faster than ever before. Viral Marketing can reach hundreds of thousands or
millions in a matter of days or hours to thespread any news in an effective way. The
technique whichhas been used to exploit preexisting social networks toproduce exponential
increases in brand awareness is similar to the spread of an epidemic. Research
studiesshow that the Internet "word of mouth" communication, i.e. Viral Marketing is far

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more effective than traditional word of mouth communication. Consumers can communicate
easily and share their own views with their acquaintances in a more critical way. This kind of
communication can reach to every locality and this is a much wider concept. The existing
literature on viral marketing indicates four emerging research which includes Consumer to
Consumer (C2C) Viral Marketing, studies of Communications, Media and Viral Marketing
positioning. Sharing online content is an integral part of modern life. There is a seamless
exchange of information through newspapers, books, You Tube videos between people in the
society. Indeed 59% of people report that they frequently share online content with others
(Allsop, et. al, 2007), and someone tweets a link to a New York Times story once every four
seconds (Harris, 2010).One may reason pot that people may like to share the information
with each other because sometimes coupon and articles about good restaurants can help them
have a good meal. Nevertheless, the previous research studies have substantial evidence to
prove that people share their emotions with closed ones apart from the regular chat messages
that are exchanged. (Berger and Milkman, 2012). Throwing some light on the predictability
of online viral marketing campaigns through the use of online marketing tools, (Van der
Lans, 2012) in his research paper “A Viral Branching Model for Predicting the Spread of
Electronic Word of Mouth” explains a branching model for successful Viral Marketing
campaigns .This also re-emphasizes the use of social media by marketers to attract customers
, not just as mere communication tool but also as an effective forecast tool to predict the time
and number of prospects to target for any such campaign.

3. INFLUENCE OF VARIOUS ONLINE TOOLS ON VIRAL

MARKETING
3.1 Use of E-Mail
From time to time, marketers have been using e-mail as a communication medium to provide
a good service network to their customers after selling the product. With the advent of social
media now, there has been a tremendous change in the way products and services are
marketed even before it is launched into the market. All kinds of e-mail marketing campaigns
would have details about the product's features, price, benefits which are aimed at inducing
positive purchasing behavior in the minds of the customer.
3.2 Chat as a Viral Forum

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Chat messages indicate the use of online chat rooms to market a product or a service. Chat
messages are used more in conjunction with creating communities for online customers, both
for existing and for creation of new ones. Marketers use this as an effective medium to create
sales pitches to prospective customers and also try to increase the frequency of such
engagements through various other activities like seminars, introductory offers etc. Chat
rooms could be made profitable through various means , not only through gaining of new
customers by also through other methods such as hosting of chat room services of other
products, charging the customers based on the number of hits and so on.
3.3 Social Media Marketing
Social media communication which uses Facebook, Twitter and other forums are used
extensively for brand creation, recognition and recall. Social media acts as a valuable source
of information, available free of cost and at the same time creates new customers in the
market even without the need of physical means of marketing the product. In regards to
company perception, brand awareness and communication, the balance of power has shifted
from the company to the consumer through the rebirth of word of mouth marketing (Datta,
Chowdhury and Chakraborty, 2005) through new media formats (Ferguson, 2008).
Understanding the relationship between word of mouth marketing and viral marketing
provides the framework for understanding of why viral marketing through social media
formats has been effective.

4. IMPORTANCE OF VIRAL MARKETING

Viral marketing is an essential facet of any successful business. Otherwise referred to as
word-of-mouth marketing, this practice is one of the least expensive options that any business
enterprise has for advertising purposes. In simple terms, it refers to the transmission of a
marketing message from one individual to another or what someone says about a particular
company to anyone else. While this message can be relayed orally, today it is more likely that
the message will appear on someone's Facebook as a part of their daily life. Viral marketing
can either break a company or make it one of the most successful and happening enterprises
in its field. Viral marketing is an innocuous form of advertising because it does not come
directly from the company's handlers, but rather, it comes as a direct result of the company's
practices. This is exactly why this type of advertising can either be the saving race or the

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downfall of a company. In the past, people used to read company reviews and rely on what
they heard on television and radio commercials. Today, however, consumers want to hear
what it is that real people have to say about products and services that they are interested in
themselves.
After all, the greater the number of people who are exposed to this type of advertising, the
greater the potential for success. Word-of-mouth marketing is more important than some
companies realize. It is not just enough to provide a great product or service and post an
advertisement about it on your website or in the newspaper. Take advantage of the gift that
viral marketing has to offer you. Open up your website to your customers and your potential
customers and watch your business grow as the interaction heats up. Promote the message
and you promote your success. Viral marketing is the key to presenting a widespread
influence on the market as you create a buzz and leverage your business enterprise to the
pinnacle of success.

5.EVOLUTION OF VIRAL MARKETING

The beginning of social media dates back to the use of e-mail as early as 1996 when the Hot
mail launched its first web-based e-mail service .they began with targeting the family, friends
and other close acquaintances of the users of Hotmail .this was the way the first chain of viral
marketing began and slowly spread to millions of users worldwide. Starting from Hotmail,
Viral Marketing has taken several forms today through various social media websites like
Facebook, Twitter, YouTube and LinkedIn. But is social media the only getaway for
marketers today to campaign their products? In large way, the answer to this question is yes.
Yet, looking at the history, we see that there have been other online tools as well which have
contributed to viral marketing in a large way. The earliest of all being the use of e-mails, the
other recent forms that have evolved are blogs, podcasts, chat forums, social media and SEO.
5.1 Use of E-Mail
The inception of Hotmail to attract more number of subscriptions through existing customer
base was one of the beginnings of such an e-mail campaign. Following Hotmail‟ s free e-
mail model, several other websites used the same technique. From time to time, marketers
have been using e-mail as a communication medium to provide a good service network to
their customers after selling the product. The other method that marketers use to lure

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customers to buy their products is by using „free service‟ as one of the tools. Although the
same strategy has been used in case of offline
5.2 Chat as a Viral Forum
Chat messages indicate the use of online chat rooms to market a product or a service. Chat
messages are used more in conjunction with creating communities for online customers, both
for existing and for creation of new ones. Marketers use this as an effective medium to create
sales pitches to prospective customers and also try to increase the frequency of such
engagements through various other activities like seminars, introductory offers etc. Chat
rooms could be made profitable through various means , not only through gaining of new
customers by also through other methods such as hosting of chat room services of other
products, charging the customers based on the number of hits and so on.
5.3 Use of Blogs and Podcasts
Blogs are journals, diaries and newsletters that have evolved in the recent times to share
information informally with a large number of people. The advantage of blogs is that they
allow the user to not only view the post but also comment on the posts and due to its ability
to spread faster among users, this has gained popularity. RSS (Really Simple Syndication)
allows users to receive regular updates based on subscription which makes users
continuously visit the website and spread messages. Podcasts services are generally very
popular forums that allow audio and video streaming of internet files to encourage users to
spread the message. Marketers use the idea of subscription similar to blogs to ensure that
more number of users spread files which contain marketing messages and product
information. The most popular among the recent podcast services are those that offered by
Apple iTunes.

5.4 The Recent Advancement in Viral Marketing

Search Engine Optimization is a new way of targeting online users in which the marketers
make use of the internet search engines to gain popularity among the users. In this, the
placement of the respective websites and products are done in such a way that the first click
on these search engines are directed towards these websites. This is emerging as a lucrative
tool to attract customers and expand the current customer base based on the number of
hits/click basis. The uses of algorithms to optimize such searches are the key to spreading

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such messages and also to market the websites by mere use of appropriate keywords. The
success of such methods largely depends on the customer base, popularity and the reliability
of search engines that offer these services.

6. PROBLEMS AND PROSPECTS OF VIRAL MARKETING IN INDIA

Viral marketing appears to be an open invitation for marketers to make some quick money by
using friendship to sell their goods and services to customers. Another perspective of viral
marketing is that it is an e-mail pyramid or e-mail pyramid selling scheme. What is
interesting is if you check out a recent viral marketing message that you have received, the
numbers identifying the person who is supposed to get the referral credit is supposed to get
the credit were rarely repeated, which indicated that somebody was keeping the record under
control. Sometimes you will note that there is a list of cancelled accounts, which include
some of the identification numbers.

 Consumers‟ lack of trust is illustrated by a recent privacy survey conducted stated

they did not complete on-line purchases because they were concerned about their
personal data might be used by the site or identity theft. Most of customers worry
about companies selling their personal information to others. So it is difficult for
marketer to change the customer perceptions. Marketers face unique challenges
created by e-commerce.
 To overcome this negative perception, marketers must gain the trust of consumers‟
and identify their privacy policies explicitly on their sites. Their customers should
know what the seller plans on doing with any personal information or indirect data
such as IP addresses and cookies they divulge as a result of visiting interacting
Websites. Consumers are being getting a significant number of viral marketing
messages, campaigns and promotions.

 Consumers are becoming annoyed and frustrated at the number of e-mails addressed
to them from viral marketers. Incorrect or false information can spread like wildfire.
This can be very damaging to many innocent marketers as well. Deliberate

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misinformation can be disseminated by competitors damaging firm‟ s reputation and

goodwill.

 Viral marketing requires a tremendous amount of computer literate programming

support and viral marketers assume that the consumer has the technological skills and
know how to react positively to their viral marketing program. What hurts so much is
not the marketer pretend to sell the product and trying that they are not selling any
product

6.1 Prospects of Viral Marketing

 Viral Marketing is a strategy that encourages individuals to pass on a marketing
message to others. This helps create exponential growth and like viruses, this strategy
takes advantage to explode the message to thousands and millions. It has also been
referred to as “buzz marketing” or “word of mouth communication”.
 Viral marketing uses existing social networks and helps in achieving brand awareness
and other marketing objectives such as product sales. Viral promotions may take the
form of video clips, interactive flash games, e-books, text messages, images and brand
able soft wares.
 Viral began as an e-commerce and marketing strategy the Internet to promote a
product or service. It now describes any strategy that encourages individuals to pass
along a marketing message to others. Word-of-mouth publicity is a centuries-old
marketing technique. Once consumers had a good experience with a product, they
would tell their friends, who would often buy and use that product and then tell their
friends, who would often buy and use the product and then tell other friends via this
social network.
 Encouragement to users spreads the information and creates the potential for
exponential growth for exposure, influence and demand number of viral marketing
messages, campaigns and promotions.
 It is a very cost-effective way to reach large target audiences. It adds a personal touch
with the consumer, because in many cases the e-mail or information was forwarded to

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them from someone they know and trust. This third party endorsement is convincing
and powerful because we all rely on the opinions of trusted friends and family.

7. SWOT ANALYSIS OF VIRAL MARKETING

Strengths Weaknesses

 Penetration or market research  Trouble scaling or maintaining a

 Active community members who are social media campaign
willing to become brand evangelists  Lack of tools or resources to track &
 Resource in term of times and monitor social media campaign
manpower, your team is able to results
response quickly and effectively  Not effective social media presence &
 Management or the C-level campaign, meaning goal are not being
executives support the social media met
medium and give you the go ahead  Tough to train or convince
management team on social media
principles

Opportunities Threats

 Creating online presence on sites  Macro factors such as economy, will

where the company currently does not affect our campaign
exist  Competitor is going after the same
 New target or niche market that are pace with similar campaign
untapped  Current campaign sustainable, can it
 Promotions, discounts, offers that can be continue
be utilized through social media  Obstacles stand in the way of success
platform and failure
 Partnerships with a publisher or
advertiser
 Penetration into a new geographical
market

8. SUCCESS OF VIRAL MARKETING CAMPAIGNS

Several researchers and industry specialists have tried to define parameters for measuring and
evaluating success of viral marketing campaigns, however their findings are somewhat
incoherent. According to Helm (2000), the primary purpose of viral marketing is maximizing
reach. Contrary opinion would be that of Jim Nail (BoD, WoM Marketing Agency), who

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states: “To succeed in WOM marketing, you need to find that segment of real ardent fans and
create special programs and tools that will empower them to share that enthusiasm”. I think
viral is an extension of the loyalty discipline (Ferguson, 2008). Viral marketing is an ideal
viral message will convert and retain a large number of recipients as new users, penetration,
loyalty and frequency are appropriate evaluative criteria. Cruz and Fill (2008) who conducted
a research on viral marketing evaluation state that the approaches used to measure and
evaluate the relative success of viral marketing communications are many and varied.
Furthermore, they claim that these approaches range from changes in attitude and behavior,
including the number of new users or levels of loyalty, to measures of reach, frequency,
penetration, speed of transmission and the content of conversations, to mention a few (Cruz
and Fill, 2008). Essentially, they assert that there is no single criterion that could be used as a
measure of success of a VM campaign – instead they propose distinct goal setting at the
beginning of the planning process which then serves as a success evaluation tool for the
campaign. They propose a framework which starts with defining a viral marketing
campaign‟ s goal as being either cognitive (reach, awareness, knowledge), behavioral (hits,
downloads, dissemination rate) or financial (ROI, brand equity developments as a result of
the campaign). Subsequent steps involve defining the target audience, deciding whether the
message is covert commercial or non-commercial and finally choosing the media to launch it
from (e-mail, mobile phone, seeding website, blog) and the message format.
9. CONCLUSION
The time has come for all companies who desire to influence company perception and sales
strategies to employ social media techniques. This includes the incorporation of viral
marketing strategies as well as avenues for consumers to interact and develop a relationship
with the company. Releasing control of the message development and translation into the
hands of the consumers does entail some level of risk. However, embracing social media
communications and marking strategies is in line with the changing and developing consumer
behavior expectations of the desired customer base. Consumers are and will continue to share
their opinions on corporate brands and products with or without company interaction.
Therefore, it is in the best interest of the company to be engaged in this communication
sharing, positively influencing the message, and facilitating action and brand awareness
through integrated viral marketing strategies. Viral marketing is a credible marketing tactic

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that can deliver positive ROI when properly executed as a component of an overarching
strategic plan. Marketers should utilize viral marketing when the messaging can coincide and
support a measurable business goal. Viral will best contribute to raising awareness of a
particular object, stimulating immediate actions on behalf of consumers such as purchasing,
sign-ups etc. however, if devised properly, it could reinforce the positive image of the brand,
leaving longer lasting impressions, as well as induce users to spend longer periods of time
interacting with the brand. It is important to note that achieving the viral effect is rather a
means to an end, and not the actual goal itself. When it is integrated with other marketing
communications approaches, viral marketing could prove to be a rather powerful tool, as
none other has the capacity to spread a message as far or as fast.

REFERENCE
[1] Allsop, D. T., Bassett, R. B and Hoskins, J. A. (2007), “Word-of-Mouth Research:
Principles and Applications,” Journal of Advertising Research, 47 (4), 388–411.
[2] Anandakrishnan, B and Dasari, S. (2010) ,A study on the Influence of Attributes of Web
portals and Incentives Offered on User Registrations, IUP Journal of Marketing Management,
Vol IX, Nos 1 & 2, 2010
[3] Berger, J and Milkman, K.L. (2012), what makes online content viral? Journal of
Marketing Research, Vol. XLIX, pg. 192 –205
[4] Cruz, D. and Fill C. (2008), “Evaluating viral marketing: isolating the key criteria”,
Emerald Insight, Marketing intelligence and planning, Vol. 26, No. 7, 2008, pp. 743-758
[5] Datta, P., Chowdhury, D., & Chakraborty, B. (2005). Viral marketing: New form of word
of mouth through internet [Electronic version]. The Business Review, Cambridge, 3(2), 69-
75.
[6] Ferguson, R. (2008), „„Word of mouth and viral marketing: taking the temperature of the
hottest trends in marketing‟ ‟ , Journal of Consumer Marketing, Vol. 25 No. 3, pp. 179-82,
ISSN 0736-3761.
[7] Helm, S. (2000), “Viral marketing: establishing customer relationship by „word-of-
mouse‟ ”, Electronic Markets, Vol. 10, No.3, pp.158-61

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MRKT 136

GREEN INITIATIVES IN THE FIELD OF MARKETING: AN

OVERVIEW IN INDIAN PROSPECTIVE

*Harmandeep Kaur, **Harpreet Singh

*
Assistant Professor, Department of Management and Commerce, Guru Nanak College,
Budhlada, Mansa, Punjab-151502, [email protected], +917087059613

**
Assistant Professor, Department of Mechanical Engineering, Guru Kashi University,
Talwandi Sabo, Bathinda, Punjab-151302, [email protected], +919915158070

ABSTRACT

Protection of the environment is an issue of key concern which has permeated into all spheres
of life. Green marketing incorporates a broad range of activities, including product
modification, changes to production process, packaging changes and modifying advertising
and ties closely industrial ecology and environmental sustainability. It is a tool used by
various companies to follow this trend of going green.Our effort explains the impact of green
marketing strategies on customer satisfaction and environmental safety using comprehensive
literature review. We will discuss in this paper: the concept of green marketing, various
challenges, opportunities, green marketing mix and green initiatives taken by the different
organisations as well as government bodies in Indian context. Ultimately it looks at how
marketers utilise their limited resources while satisfying customers demands, as well as
achieving the sales objectives of the organisation. This study describes the reasons why
companies are adopting it and concludes that green marketing is gaining importance in India
for various issues.

Keywords: Green Marketing, Green Product, Challenges, Marketing Mix.

1. INTRODUCTION

The growing concern about preserving the natural environment has induced the organization
to develop a new marketing concept called Green marketing. It is a broader concept that can

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be applied to customer and industrial goods and services. The American marketing
association defined this concept that green marketing is the marketing of products that are
presumed to be environmentally safe. Earlier, it was believed that green marketing is a
concept of marketing eco-friendly products. Nowadays, green marketing incorporates various
processes such as production, packaging and advertising. Thus green marketing incorporates
a broad range of activities, including product modification, changes to the production
process, packaging changes, as well as modifying advertising. Green marketing refers to
holistic marketing concept and also called environmental marketing/ecological marketing.
However it involves high start-up cost but helps organizations to earn more profit and gain
competitive advantage in the long run.

2. EVOLUTION OF GREEN MARKETING

According to Peattie (2001), the evolution of green marketing has three phases. First phase
was termed as Ecological" green marketing, and during this period all marketing activities
were concerned to help environment problems and provide remedies for environmental
problems.
Second phase was "Environmental" green marketing and the focus shifted on clean
technology that involved designing of innovative new products, which take care of pollution
and waste issues.
Third phase was "Sustainable" green marketing. It came into prominence in the late 1990s
and early 2000.

3. OBJECTIVES OF THE STUDY

1. Aneffort to familiarize with the term of green marketing.
2. To discuss the present scenario of Green marketing in India.
3. To study the role of Green marketing in sustainable development prospective.

4. RESEARCH METHODOLOGY
The research is exploratory in nature; it focuses on Literature review, News Papers, Journals,
websites and the other reliable sources.
5. LITRATURE REVIEW

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Philip Kotler (2011) recognized that the Companies need to make extreme changes in their
research-and-development, production, financial, and marketing practices if sustainability has
to be achieved. The several environmental challenges to be considered in the sustainability
are change in the composition of the atmosphere, depletion of the ozone layer, soil
degradation & increased desertification, increased air and water pollution.
According to Yvon Chouinard et. al (2012), Sustainability is survival. The essential services,
such as clean water, clean air, arable land, and a stable climate, are what all businesses
depend on to survive. Sustainability is not a tomorrow problem, but it is a movement.
Smitha Khare (2011): Amid ecological debates and the alarm bells over global warming, a
resolute Indian is firm on making the country greener. Environmental consciousness is
gradually becoming part of today‘s lifestyle with everyone chipping in to make the country
greener, needs met from renewable.
Martin Wright (2011): In a world of dwindling natural resources, sustainability is no longer a
fashionable word. It makes business sense. Leading companies are adapting fast. Unilever
has committed to halving its environmental impact by 2020- while doubling sales Wal-Mart.
plans to have 100% of its energy.
In their study by Philip Kotler et al (2010), Environmental Sustainability refers to generating
profits while helping to save the planet. Companies can use to gauge their progress towards
progress environmental sustainability through internal and external “greening”‖ and internal
and external “beyond greening”.

• Internal and external “greening” includes pollution prevention (eliminating or reducing

waste before it is created and product stewardship (minimizing environmental impact
throughout the entire product life cycle).

• Internal and external “beyond greening” includes new clean technology (developing new
sets of environmental skills and capabilities) and Sustainability vision (creating a strategic
framework for future sustainability).

According to Ramanigopal (2010), Global warming is affecting the world economy. Acting
now will cost less than 1% of Indian GDP. A study about the environment and societal ethics
can help the future managers and equips them with essential knowledge to convert the
challenges faced today into opportunities.

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Karpagam & Geetha Jai Kumar (2010) observed that the Ministry of Environment and
Forests launched the scheme of labelling of environment-friendly products in 1991. The label
is awarded to consumer goods which met the specified environmental criteria and the quality
requirements of Indian standards.

Pingali Venugopal(2010): Positioning a brand as a green brand entails an active

communication and differentiation of the brand from its competitors on environmentally
sound attributes. The most effective brand strategy green positioning would be centered in the
creation of emotional benefits sustained by information on environmentally sound functional
attributes

David L. Loudon & Albert J. Della Bitta (2010) signified that the green movement is
growing extensively and marketers are seeking to cash in on an environmental awakening.
Green may be to the 90’s what light was to the 80’s, with products clamoring to show how
they are environmentally sensitive.

Gregory Unruh and Richard Ettenson (2010) found that Green growth is at the top of many
leaders ‘agendas, but the way forward is rarely clear. The three broad product strategies like
Accentuate, Acquire and Architect should align green goals with your capabilities.

Dutta, B. (2009, January) in his article on Green Marketing titled “Sustainable Green
Marketing The New Imperative” published in Marketing Mastermind states that Green
Marketing involves developing good quality products which can meet consumer needs and
wants by focusing on the quality, performance, pricing and convenience in an environment-
friendly way.

Michael R. Solomon(2009) identified that firms that adopt the philosophy to protect or
enhance the natural environment as they go about their business activities is an instance of
green marketing. Marketers point to a segment of consumers who practice LOHAS – an
acronym for ―Lifestyles of Health and Sustainability.

BPP Learning Media, Marketing (2009) found that the responsibility of Green marketing is
based on two main ideas: one is for the community and the other is sustainability. Social
responsibility is based on two ideas like the moral and ethical responsibilities of businesses

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and Sustainability involves pursuing equity in the distribution of resources, to maintain the
integrity of world ecosystems and to increase the capacity of human populations for self-
reliance.

Philip Kotler et al (2009) revealed that Environmental concerns are manifested in much
behaviour. Many top companies such as McDonald‘s Nike, GE, and Dupont are embracing
sustainability and green marketing. UPS and FedEx have introduced alternative-fuel and
hybrid electric diesel vehicles to their fleets.

The study by Henry Assael (2006) observed that In U.S., Companies have taken actions to
promote environmental controls towards green marketing; For example : Reynolds Wrap
promotes recycling , while Crane Papers advertises the natural content of its products,
McDonald‘s switched from plastic to paper wrapping and uses recyclable products to build
its restaurants.

Douglas J. Darymple & Leonard J. Parsons (2002) believe that the green movement is a
answer for business to produce more environmentally safe products. This approach is known
as green marketing. Environmentalism is only one aspect of responsible conduct. The
products should be designed for recyclability where possible.

6. GREEN MARKETING MIX

The combination of 4 Green P‟ s or Green factors (Eco-friendly) is known as Green

Marketing Mix namely; Green Product, Green Promotion, Green Place and Green Price.

Green Product: While manufacturing green products the firms should incorporate
environmentally friendly resources or materials in the product. The characteristics of the
resources or materials used in the product and its packaging should influence environmental
elements.
Green Promotion: The firms should focus more on “Green Advertising” in order to
communicate to its green customers (who uses eco-friendly products) and as well as
traditional customers (who are not green users) about the concept of environmental

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protection. Apart from this, the firms should also launch promotional tools such as schemes,
coupons, offers and premium etc; in order to attract consumers to buy eco-friendly products.

Green Place: Green products and services which are to be delivered from the point of
producers to the point of ultimate green consumers. In this context, the firm should choose a
proper channel considering product characteristics, consumer characteristics and market
characteristics.

Green Price: It is often perceived by the consumers that the prices of green products are
relatively higher compared to the traditional products. If production and operating costs are
lowered, it would give green products more competent force on the market.

7. WHY COMPANIES FEEL THE URGENCY TO

GO GREEN

There are several reasons why these companies feel the urgency to act:
First, they simply may be trying to stay relevant by aligning more closely with the evolving
expectations that consumers have for the companies they purchase from and the brands they
associate with.

Second, they may be trying to secure a competitive advantage in the market as an early
mover on green and perhaps enable them to reach new customer segments that have a strong
affinity for the environment.

Third, various regulations recently framed by the government to protect consumers and the
society at large led to the adoption of Green marketing as a compulsion rather than a choice.
For example, the ban of plastic bags in many parts of the country, and prohibition of smoking
in public areas, etc.

8. CHALLENGES WHILE IMPLEMENTING

GREEN MARKETING STRATEGY

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Following are the challenges faced by an organisation while implementing green marketing
strategy:
1. Require costly renewable and recyclable materials
2. Need huge investment on research and development.
3. Need to educate customers about green products and their benefits.
4. Requirement to persuade customers to pay extra money for green products.
5. To attain full cooperation of all stake holders.

9. GREEN MARKETING INITIATIVES IN INDIA

Green Vehicles:Green, hybrid, electric are buzzwords as nearly all auto makers are
showcasing their environment-friendly vehicles at the auto show on January, 2016.Imagine
tyres that generate electricity for your electric vehicle. They could be a reality soon on the
streets of India, with tyre maker Good Year Tire & Rubber Co. developing a concept tyre.
The company expects it to become a reality soon for customers.

The product is being showcased at the 2016 Auto Expo where green, hybrid and electric
vehicles are the buzzwords as nearly all automakers are showcasing their environment-
friendly vehicles.

“This tyre generates electricity and has built-in heat and motion sensors. It captures heat from
the tyres as well as motion from the road and converts that into electricity. So,if you have an
electric car, it can help recharge that on the go as well as when car is parked. In sun, when car
is parked, it will absorb heat from sun and convert it into electricity,” said Mike Rytokoski,
vice-president of consumer tyres for Good Year’s Asia Pacific Region.

Amid an ongoing debate on vehicular pollution, resulting in poor air quality and sparking
health scares, these green vehicles are evoking massive interest among visitors.

India plans to have six million electric vehicles on the road by 2020 in a bid to reduce
vehicular pollution and combat global warming.

The government expects the electric vehicles to help India save 2.2 million tonnes to 2.5
million tonnes of liquid fuel, valued around Rs.14,000-15,000 crore, and reduce carbon
dioxide emissions by up to 1.5%. In the next two years, the government hopes the push will

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help facilitate sales of at least 800,000 electric vehicles, led by two- and three-
wheelers, Mint reported in January 2015.

India is the third most polluting country in the world after the US and China, who have
signed a major bilateral climate deal, wherein the US will reduce its carbon emissions by 26-
28% below its 2005 level by 2025 and China will reach the peak of its harmful carbon
dioxide emissions around 2030.

Diesel and heavy vehicles, considered among most polluting vehicles, have drawn the Indian
judiciary’s attention in the past few months. But the question that looms over the future of all
such vehicles is whether the price-conscious Indian consumer will pay the higher price for
such vehicles.

Alongside, industry heavyweights like Tata Motors Ltd, Ashok Leyland Ltd and
Mahindra and Mahindra Ltd are showcasing their hybrid and electric buses.

Tata Motors has showcased an “Ultra Electric” bus and a new hybrid CNG bus.

Ashok Leyland is also launching “Hybus”, a CNG hybrid bus and showcasing a BS-VI
compliant truck.

The central government recently announced plans to leapfrog from Bharat Stage-IV to
Bharat Stage-VI emission norms and advanced the deadline to 2020.

Mahindra and Mahindra Ltd showcased its hydrogen bus “Cosmo” and Eicher unveiled
its hybrid “Skyline Pro”, a school bus.

Besides heavy vehicles, four-and two-wheeler manufacturers also presented hybrid and
electrical vehicles.

Wipro's Green Machines (In India Only): Wipro InfoTech was India's first company to
launch environment friendly computer peripherals. For the Indian market, Wipro has
launched a new range of desktops and laptops called Wipro Green ware. These products are
RoHS (Restriction of Hazardous Substances) compliant thus reducing e-waste in the
environment.

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HCL Technologies: This IT major may be considered as the icon of Indian green initiatives,
thanks to the “go green” steps taken in solving the problem of toxics and e-waste in the
electronics industry. HCL is committed to phasing out the hazardous vinyl plastic and
Brominated Flame Retardants from its products and has called for a Restriction on Hazardous
Substances (RoHS) legislation in India

Samsung: Itwas the first to launch eco friendly mobile handsets (made of renewable
materials) – W510 and F268- in India.

Oil and Natural Gas Corporation Ltd. (ONGC): India‘s largest oil company, has
introduced energy-efficient Mokshada Green Crematorium, which saves 60% to 70% of
wood and a fourth of the burning time per cremation. ONGC, is all set to lead the list of top
10 green Indian companies with energy-efficient, green crematoriums that will soon replace
the traditional wooden pyre across the country Reva, India‘s very-own Bangalore based
company was the first in the world to commercially release an electric car.

ITC Limited: ITC has introduced Paper Kraft, a premium range of eco-friendly business
paper. It strengthened their commitment to green technologies by introducing ‘ozone-treated
elemental chlorine free’ bleaching technology for the first time in India. The result is an
entire new range of top green products and solutions: the environmentally friendly multi-
purpose paper that is less polluting than its traditional counterpart.

State Bank of India: SBI entered into green service known as “Green Channel Counter”.
SBI is providing many services like paper less banking, no deposit slip, no withdrawal form,
no checks, no money transactions form all these transaction are done through SBI shopping
& ATM cards. State Bank of India turns to wind energy to reduce emissions

Hero Moto Corp: Hero Honda is one of the largest two-wheeler manufacturers in India and
an equally responsible top green firm in India. The company’s philosophy of continuous
innovation in green products and solutions has played a key role in striking the right balance
between business, mankind and nature.

Tata group of companies: Tata Motors ltd. has developed their showroom by using green
items and elements in its design. It shows eco-friendly atmosphere that attracts people

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towards itself. They are also going to launch a low cost water purifier which is made of pure
and natural ingredients.

Kirloskar Brothers:It is marketing a line of highly-energy efficient pumps, significant

because pumping water is one of the major drivers of energy demand.

Godrej:makes energy-efficient air-conditioners, and is one of the first makers in the world to
market products with extremely-low-GHG refrigerants.

IDEA Cellular:One of the best Indian companies, IDEA, paints India green with its national
‘Use Mobile, Save Paper’ campaign. The company had organized Green Pledge campaigns at
Indian cities where thousands came forward and pledged to save paper and trees. IDEA has
also set up bus shelters with potted plants and tendril climbers to convey the green message.

Digital tickets by Indian Railways: IRCTC has allowed its customers to carry PNR no. of
their E-Tickets on their laptop and mobiles. Customers do not need to carry the printed
version of their ticket anymore.

Lead Free Paints from Kansai Nerolac: Kansai Nerolac has worked on removing
hazardous heavy metals from their paints. The hazardous heavy metals like lead, mercury,
chromium, arsenic and antimony can have adverse effects on humans. Lead in paints
especially poses danger to human health where it can cause damage to Central Nervous
System, kidney and reproductive system.

10. SUGGESTIONS TO MAKE GREEN MARKETING SUCCESSFUL

Green marketing is a strategy to attract customers however, it involves high start-up cost but
helps marketers to earn more profit and gain competitive advantage in the long run. The
organization should keep its potential customers aware about its green products and eco-
friendly activities. There are the keys to make green marketing successful:

1. Being Genuine: An organization should do what it claims to

do.

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2. Educating Customers: Organization refers to making

customers aware about the environment friendly activities of the company.
3. Participation of Customers: Organization should have
efforts to give customers an opportunity to participate in green marketing and making
customers realize the benefits of eco-friendly activities by encouraging them to
participate in these activities.

11. CONCLUSION

Green marketing is a phenomenon which has developed particular important in the modern
market and has emerged as an important concept in India as in other parts of the developing
and developed world, and is seen as an important strategy of facilitating sustainable
development. Adoption of Green marketing may not be easy in the short run, but in the long
run it will definitely have a positive impact on the firm. Green Marketing is still in the stage
of childhood in the Indian companies. The lots of opportunities are available in Indian
market.

REFERENCES

[1]. Kotler Philip (2000), Marketing Management, The

Millennium Edition Prentice Hall of India Private Limited, New Delhi.
[2]. Sharma D.D. (2008), Marketing Research: Principle
Application & Cases,N. Delhi, Sultan Chand & Sons.
[3]. Ottman A. Jacquelyn (2011), The New Rules of Green
Marketing: Strategies, Tools, and Inspiration for Sustainable Branding, Berrett-Koehler
publishers.
[4]. Mathur, L.K., Mathur, I. (2000).”An Analysis of the wealth
effect of green marketing strategies, Journal of Business Research”, 50(2), 193-200.
[5]. Dutta, B. (2009), Sustainable Green Marketing the New
Imperative, Marketing Mastermind. Pg 23-26. Hyderabad: The ICFA University Press.

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[6]. H.Ramakrishna (2012),”Green Marketing in India: Some Eco-

Issues”, Journal of Marketing, Vol-42, No-11, 11-14.
[7]. www.google.com.
[8]. www.managementparadise.com.
[9]. www.businessworld.in.
[10]. www.outlookindia.com.

Mrkt138
A descriptive study of green marketing practices by cosmetics
brands in India
*Shikha Sota
*Assistant Professor; Department of Management studies, Continental Group of Institutes,
FGS, Punjab, India
*Email ID: [email protected], Contact Number: +91-9888020221

ABSTRACT

Green is the most favourite colour of marketers these days. They are going green; some in all
the aspects of their marketing mix and some in few aspects of it. They are doing it as it seems
to make sense in terms of sustainability. To be most successful, a commitment to
sustainability is usually a part of the company’s overall vision and an integral part of the
company’s values and fundamental beliefs. Nations have become more concerned with the
natural environment; therefore businesses are addressing this issue by modifying their
product/service mix. The cosmetics industry & beauty business in India is growing
phenomenally. This paper attempts to look into ways in which cosmetics brands present in
India are engaging into green marketing. It examines the green initiatives taken by some
cosmetics companies in India.

Key words: Green Marketing, Sustainable Marketing, Green Brands, Eco friendly cosmetics

INTRODUCTION
According to the American Marketing Association, green marketing is the marketing of
products that are presumed to be environmentally safe. Thus green marketing incorporates a
broad range of activities, including product modification, changes to the production process,
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packaging changes, as well as modifying advertising. An eco-friendly/green product is

supposed to reduce the impact of its consumption on the environment due to the use of
making-processes, components and recycling techniques which are less harm for the natural
environment than those of conventional products. The green marketing plan focuses on the
ideal marketing mix to achieve maximum profit potential while adhering to sustainability
principles.

Use of cosmetics manufactured from herbs and plant extracts has been popular from
traditional times. However, green marketing of these products is rather recent. Encouraged by
the growing environmental consciousness on the part of citizens and a growing market for
cosmetics, several global and local companies have employed green marketing strategies.
According to the India beauty report by Indo Canadian Chamber of Commerce and Industry,
consumers are increasingly shifting towards ‘natural’ and ‘herbal’ cosmetic products as they
are associated with bio-active ingredients and safe for human skin. A market research report,
"Indian Cosmetic Market Outlook 2018", reveals that cosmetics market, once female
dominated, has started earning high revenues from male counterparts as well, by catering to
male-specific needs especially in creams and lotions. According to the same report, herbal
cosmetic products are increasing foothold in the Indian cosmetics industry with the growing
demand for natural products and awareness about their benefits among the population.

REVIEW OF LITERATURE

According to Peattie (2001), the evolution of green marketing has three phases. First phase
was termed as "Ecological" green marketing, and during this period all marketing activities
were concerned to help environment problems and provide remedies for environmental
problems. Second phase was "Environmental" green marketing and the focus shifted on clean
technology that involved designing of innovative new products, which take care of pollution
and waste issues. Third phase was "Sustainable" green marketing. It came into prominence in
the late 1990s and early 2000. Green marketing is a vital constituent of the holistic marketing
concept. It is particularly applicable to businesses that are directly dependent on the physical
environment; for example, industries like fishing, processed foods, and tourism and adventure
sports.

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According to the Joel makeover, green marketing faces a lot of challenges because of lack of
standards and public consensus to what constitutes "Green". The growth of green marketing
and green consumer is “perhaps the biggest opportunity for enterprise and invention the
industrial world has ever seen" (Cairncross 1992: 177). A green consumer can be identified to
be one who avoids any product which may harm damage to any living organism, cause
deterioration of the environment during process of manufacturing or during process of usage,
consume a large amount of non-renewable energy , involves unethical testing on animals or
human subjects (Elkington, 1994).

According to Charter (1992), green marketing is defined as ‘greener marketing is a holistic

and responsible strategic management process that identified, anticipates, satisfies and fulfil
stakeholder needs, for reasonable reward, that does not adversely affect human or natural
environmental wellbeing’. This definition adds a strategic dimension stressed the importance
of a long term perspective and the role played by stakeholders.

According to a report by Euromonitor International, since 2006, products based on natural

ingredients have become part of mainstream offerings. This is a global phenomenon that is
being driven by increased focus on health and well-being, and a rising awareness regarding
allergies and the perception of health risks from chemical exposure. While natural beauty
products never really went out in the Indian market, there is a new glamour in using nature-
based or organic beauty products. Consumers who purchase natural or organic beauty
products in India seem to do so in order to make a statement about their lifestyle.

According to a report (2013) by Michelle Yeomans titled,” Ayurveda tipped as new growth
frontier for beauty business in India”, the Indian skin market is expected to grow at more than
10 per cent in the next five years and today boasts a plethora of herbal cosmetic brands like
Forest Essentials, Biotique, Himalaya, Blosson Kochhar, VLCC, Dabur and Lotus and has
years before it gets too crowded. Companies are engaging in advanced research of plant
derived peptides, encapsulated actives, active plant stem cells, complex extraction processes
and clinical testing to deliver products that are acceptable to the well informed customers.

GREEN MARKETING INITIATIVES BY COSMETICS COMPANIES

IN INDIA

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The Body Shop

The Body Shop International is a global manufacturer and retailer of naturally inspired,
ethically produced beauty and cosmetics products. Dame Anita Roddick opened the very
first. The Body Shop Foundation owns a charity, launched in 1990. The Foundation's focus is
to assist those working to achieve progress in the areas of human and civil rights,
environmental and animal protection. Body Shop was regarded as one among the first firms
in the world to publish a proper report on its social responsibility initiatives. The Body Shop
is a leader in promoting greater corporate transparency and it has been a force for positive
social and environmental change through its campaigns around five core Values:

 Support Community Trade

 Defend Human Rights
 Against Animal Testing
 Activate Self-Esteem
 Protect Our Planet

They do not test on animals and has made a commitment with the suppliers in the community
trade to ensure that the resource is natural and fair for any workers. The Body Shop supports
local community as it follows the practice of trading with communities in need and giving
them a fair price for natural ingredients or handcrafts they purchase from these often
marginalized countries. The first Community Trade activity in 1987 was a footsie roller
which was supplied by a small community in Southern India (today known as Teddy Exports)
and still a key CT supplier. The Body Shop does not export its products to China, because
cosmetics sold there have to be tested on animals

The Body Shop carries a wide range of green products for the body, face, hair and home. The
Body Shop claims its products are "inspired by nature" and they feature ingredients such
as marula oil and sesame seed oil sourced through the Community Fair Trade program.

In 2010, The Body Shop produced its first ECOCERT certified organic skincare line,
Nutriganics. The certification aims to check the ingredients, processes, production, and
storage of raw materials, packaging, labelling, use of energy resources and waste
management and the certification of producers to ensure the quality of the final product,

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which means, the certification agencies impose standards that should be fulfilled by the
production industry to be able to ensure the final product quality.

Lush Fresh Handmade Cosmetics

Lush is a cosmetics retailer headquartered in Poole, Dorset, United Kingdom. The company
was founded by Mark Constantine, atrichologist and Liz Weir, a beauty therapist. Their
products are made of natural ingredients, using carefully blended plants, flower absolutes and
fine essential oils, and they do not do any animal testing either.
It has many ‘naked products’ means that they are not packed or wrapped, nor do they come
in a box. They save on paper, plastic and other wrapping material. The products are packed in
recycled newspaper wrapping and handed over to customers on purchase.
The company adopts Japanese style of gift wrapping called Furoshiki, where in it uses a scarf
to wrap gifts. These scarves are made of recycled plastic products and look exactly like
fabric. The company makes shampoo bars in solid form, rather than bottled, and saves over
450,000 liters (118,800 gallons) a year. All the pots and bottles of product are all recycled.
The company never uses any virgin material for packing anything. The methods of
preparation are eco-friendly too. The company employs all possible methods of energy
optimization and efficiency retrofits within its manufacturing facilities, distribution centres
and stores. 100% of the electricity consumed, is replenished into the grid with renewable
energy from wind and low-impact hydro, through Bullfrog Power.

Himalaya

Himalaya opposes animal testing. Cosmetic products are never tested on animals. It believes
that there is no way to justify pain for profit. The notion that a cream or lotion which makes
us look and feel good, has been developed by testing on animals is sad and in this day of
scientific progress, absolutely unacceptable.

All the Himalaya's herbs are organically grown. It follows international Good Agriculture
Practices in the cultivation of herbs. In fact, it goes beyond GAP rules, which permit use of
synthetic fertilizers in very small quantities. Himalaya stays away from using any form of

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chemical fertilizers or pesticides in its farming. The herbs are grown in an eco-sensitive way
so that we protect the earth and harvest herbs with all its natural goodness.

To protect herbs from insect and pest attack, it makes use of prophylactic sprays like Neem
Oil. This acts like a natural insect repellant. It is sprayed on the plants at least 45 days before
harvest, so that when the herb is harvested there is no residue of Neem oil.

At Himalaya, it is made sure that collection of herbs is done on a sustainable basis. The
'pedigree' of the herb, which shows its availability, region where it is present, quantity and
other details of its history, is tracked and recorded, to ensure that there is no excessive
collection. Farmers are trained in sustainable harvesting and local conservation, thus making
them active participants in securing their environmental and economic future. Efforts are
made to preserve environmental biodiversity by investing in research to cultivate endangered
herbs.

To give the soil its share of nutrients it makes use of Farm Yard manures and vermicompost -
both are earth friendly and nutrient rich. Vermicompost enhances bio-activity of the soil,
increasing soil fertility and its water holding capacity. During non-harvest season, to restore
the earth's natural nutrients and protect it from weeds, fungi, nematodes and other harmful
insects, the soil is exposed to the sun, a process known as Soil Solarization. Soil that has been
solarized allows plants to draw on nutrients, especially nitrogen, calcium, and magnesium.
Seeds germinate more quickly. Plants grow faster, mature earlier and give higher yields. This
chemical-free and pollution-free environment gives us herbs which are nature's best in quality
and contribute to making products both safe and efficacious.

Blossom Kochhar Aroma Magic

Blossom Kochhar Aroma Magic had a humble beginning in 1992. The company claims that it
works with nature, and not against it. It uses sustainable sources and ethical harvesting
practices for the ingredients. The company values its passion for all things natural also
inspired a love for an alternative way of living and healing. It uses only natural, safe
and sustain-ably grown and harvested fragrances, colours, plant extracts and organic
ingredients. All Aroma Magic formulations are produced using the highest grade natural
ingredients and applying the ancient sciences and modern scientific rigour to every product to

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guarantee the customer’s safety, while not compromising on the products' performance. Their
products are completely free from parabens, alcohol, petrochemicals, mineral oils, phthalate,
synthetic colours and artificial fragrances. All the franchises of Blossom Kochhar Aroma
Magic Salons adhere to the Green concept. All the salons are designed as per environment
friendly building guidelines and use only pre-specified construction materials. The salons
only use products which are eco-friendly as specified in their approved List of brands and
products. It is mandatory to participate in community related and corporate social
responsibility programmes.

L’oreal

The company follows three principles in terms of sustainability:

 Innovating sustainably
 Producing sustainably
 Living sustainably

Every time, L’oreal invents or updates a formula, it makes aure that it reduces the
environment footprint. The new formula always uses raw materials that are sustainably
sourced or raw materials derived from Green chemistry. The new packaging has an improved
environmental profile. It has reduced CO2 emissions at our plants and distribution centres by
60% in absolute terms, from a 2005 baseline. We will reduce our water consumption by 60%
per finished product unit, from a 2005 baseline. We will send zero waste to landfill.

This includes making sure that renewable raw materials used in our products are sustainably
sourced. For example we source argan oil in Morocco directly from six women-led
production cooperatives, ensuring a stable income for around 300 women, and protecting the
biodiversity of the ecosystem. And, as of 2011, our shampoos and our shower gels are on
average 88% and 85% biodegradable. L'Oreal has collaborated with self-adhesive label firm
Avery Dennison to identify and reduce the environmental impacts of packaging labels
throughout the entire label lifecycle. This approach is able to identify where the biggest
environmental impacts lie and to devise strategies on how best to mitigate these impacts.

Fresh Line

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The first shop was set up in the area of Chalandri in Athens in 1993. In 2004, after many
years of preparation and only after upgrading all the company's systems, processes and
procedures, the company makes its first step abroad. Fresh Line has gained a strong
international presence with its distinctive range of organic cosmetic products. The vision
behind it was to use ancient Greek recipes to make fresh homemade cosmetics. The USP of
Fresh Line is that it uses fresh ingredients and that is the reason for naming it Fresh Line. In
the entire range of products, there are no harmful ingredients like sodium lauryl sulphate,
silicon, and propylene glycol. Also, the company is against animal testing.

Forest Essentials

The three most prized values of Forest Essentials are:

 A beautiful environment
 Economic empowerment
 Social Contribution

The green practices of the company are:

 Deriving herbs from sustainable agriculture

 Following environmentally friendly manufacturing and transportation
 With focus on conservation & renewal energy
 Renewing our community through local employment, suppliers
 Following environment friendly waste management practices

The company has a world-class manufacturing facility with pharmaceutical grade production
standards. A Green factory by design, our controlled manufacturing ensures that it delivers a
sophisticated product that is conscientious about the environment. The company is constantly
looking at ways to reduce our carbon footprint and focus on using renewable plant sources in
our products.

CONCLUSION

Green has always been “in” in India. Natural ingredients have always been a part of the
beauty regime of Indian women. Because of the country’s Ayurvedic heritage, there has
always been an emphasis on using natural products and herbs for beauty care. Traditional

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home beauty recipes have been passed down through generations, defining key beauty
regimens for most men and women in India. Globally, too the trend for natural cosmetics is
on the rise. So many brands both Indian and International are basing their skin & hair care
products on natural/organic ingredients. The cosmetics brands are trying to sell the
philosophy and not just the product. The companies which were not originally into green and
sustainable products are now launching a special range of such products. The consumer also
doesn’t mind paying premium as she thinks that she is also supporting the green planet. The
future of cosmetics looks quite bright and green in India.

REFERENCES
1. Hemantha Y; Green marketing-an exploratory research on consumers in Bangalore
city. Abhinav national monthly refereed journal of research in commerce &
management; volume no.1, issue no.9
2. Surya Rawat, Pawan Garga. Understanding Consumer Behaviour towards Green
Cosmetics. http://ssrn.com/abstract=2111545
3. Jacob C, Jolly J (2012). Green Marketing: A Study of Consumers’ Attitude towards
environment Friendly Products. Asian Social Science; Vol. 8, No. 12
4. Morel M, Kwakye F. Green marketing: Consumers’ Attitudes towards Eco-friendly
Products and Purchase Intention in the Fast Moving Consumer Goods (FMCG)
sector.Master thesis, Umeå School of Business
5. Sameer A. Virani (2014). Herbal (Organic) Cosmetics the way ahead in Modern
India. Int. J. of Trade and Commerce-IIARTC, Vol. 3, No. 1, pp. 182-194
6. Bruno Fonseca-Santos, Marcos Antonio Corrêa, Marlus Chorilli(2015).
Sustainability, natural and organic cosmetics: consumer, products, efficacy,
toxicological and regulatory considerations. Brazilian Journal of Pharmaceutical
Sciences, vol. 51
7. The L’oreal sustainability commitment report. www.loreal.com/sharingbeautywithall
8. Abdullah Bin Junaid*, Reshma Nasreen, Faheem Ahmed. (2013). A Study on the
Purchase Behaviour and Cosmetic Consumption Pattern among Young Females in
Delhi and NCR. Journal of Social and Development Sciences Vol. 4, No. 5, pp. 205-
211

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9. Priti Aggarwal (2013). Green marketing in India: emerging opportunities and

challenges. Global Journal of commerce & Management; Perspective.Volume
2(4):85-88
10. Shanshan Li, Zifei Tang (2010). Understanding Green Marketing with Marketing
11. Mix—a case study on The Body Shop. Bachelor thesis in Business; Department of
business, University of Gavle
12. Harish Bhat (2014). Fifty shades of green. The Hindu Business Line
13. Indian Cosmetic Market Outlook (2015). https://www.reportbuyer.com/
14. Green Marketing Strategy and the Four P's of Marketing. Sustainable Business Cases
(v. 1.0)
15. Asha chowdary (2010). Is that lipstick eco-friendly. www.dna.com
16. https://www.lushusa.com/Our-Green-Policy/about-green-policy-intro,en_US,pg.html
17. http://www.edie.net/news/5/LOreal-aims-to-improve-environmental-profile-of-
packaging-labels/
18. http://www.himalayaglobalholdings.com/abouthimalaya/what-we-stand-for.htm
19. http://www.forestessentialsindia.com/the-brand

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MRKT 139
Electronic Retailing / E-tailing with Special Reference toFlipkart,
Amazon and Snapdeal
*Mr. PARMANAND BARODIYA
*Research scholar of Commerce Dept. Madhav Mahavidyalaya, Gwalior (MP)
E-mail: [email protected]

Abstract:
Electronic retailing (E-tailing) is a buzzword for any business-to-consumer (B2C)
transactions that take place over the Internet. Simply put, e-tailing is the sale of goods online.
Companies like Amazon and Dell created the online retail industry by putting the entire
customer experience from browsing products to placing orders to paying for purchases - on
the Internet. The success of these and other companies encouraged more traditional retailers
to create an online presence to augment their brick-and-mortar outlets.Electronic retailing
may also be referred to as Internet retailing. In this paper we focus to study of E-tailing, to
know the Steps involved in E-tailing, andAnalysis of Revenues & Losses Comparison of
Flipkart Vs Amazon Vs Snapdeal.
Keyword: E-Tailing, Retail, Shopping, Flipkart, Amazon and Snapdeal.

Introduction:-

If few years back technology brought the shopping information on to the laptops, today it
brings the products right to the doorstep. With the use of internet as a medium a person can
buy products from a virtual store (shopping website).Though detractors to this technological
advancement thought that this would take the joy off shopping, it has only added a whole
new perspective to shopping. The word E-tail has its roots in the word ‘retail’. Here the letter
E stands for ‘electronic’ since the shopping process happens through the electronic media
(internet). With the use of a web-space a virtual shop is created and the products are
displayed through images in this space with the features and price tags. By accessing this
shopping site a customer can choose his/her products into a cart. The payment to this product
can be done in various modes as mentioned by the shopping site. The product would be
delivered to the address specified by the customer.
E-tailing: Electronic retailing, also known as e-tailing, deals with selling products and
services online via the Worldwide Web. Internet retailing or ‘e-tailing’, as it is usually

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referred to, covers retailing using a variety of different technologies or media. It may be
broadly a combination of two elements. One is combining new technologies with elements of
traditional stores and direct mail models and the second is using new technologies to replace
elements of store or direct mail retail.

Review of Literature:-
According to Turban (2006), e-tailing is defined as retailing conducted online, over the
internet. Wang (2002) has provided a broad definition of e-tailing by defining it as the
selling of goods and services to the consumer market via the internet. Zeithaml (2002) has
defined that the success of e-tailing depends on the efficient web site design, effective
shopping and prompt delivery. The other e-store services are delivery on real time, return
and replacement process, period of filling out online orders form, speed of response time
to e-customers queries. Ratchford (2001) have told that through Internet, consumers can
gather information about merchandise and they compare a product across suppliers at a
low cost.

Objective:-
 To study of E-tailing.
 To know the Steps involved in E-tailing.
 ToAnalysis of Revenues & Losses Comparison of Flipkart Vs Amazon Vs Snapdeal.

Research Methodology:-
The researchers have adopted descriptive methodology for this study Research has been
placed on secondary data sources such as books, journals, newspapers and online database.

Steps involved in E-tailing: - The shopping process through internet media happens in 5
steps generally
 Customer visit: The customer accesses the website of the e-tailer through his/her mobile
or PC or laptop. This visit is very critical to the e-tailer because it is this visit that would
create an opportunity for a business. The simplicity of the site, the arrangements of the
products in the site and various other factors decide the first impression of the customer.
Choice of product: Once the customer visits the site he/she would choose a product based
on the image and valid information available on the web page. This information can
include the price tag, details about the product, availability/deliverable time span and
even customer reviews on the product.
 Payment online: Once the customer chooses the product the next step would be to go
through a secure process of data exchange. The e-tailer may provide a unique user
account to the customer to keep the transaction safe. Payments to the product can be made
online through credit or debit card or even cash on delivery basis where the customer
pays the e-tailer when the product is delivered to him/her.

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 Product delivery: Once the order is placed with the e-tailer the next process would test
the efficiency of supply chain network of the e-tailer. The delivery of the product would
be based on the availability of the product in the inventory closest to the customer’s
delivery address. This process may also involve shipment of the product. There are
different methods used in this process. Some e-tailers just create a platform through a
website where the business actually takes place between the customer and a company (or
business) who is a client to the e-tailer. Here the e-tailer would just take the commission
on each product sold. Typically an e-tailer may also choose to buy products that have
potential demand and then display it on the site. In this case the e-tailer would have to
take care of inventory expenses and also the entire procurement and disbursement cycle.
 Customer feedback: Once the product is delivered to the customer the feedback from the
customer is very much important. This is primarily because of the absence of a real
shopping store environment. The entire experience of the customer during the process
would be an indicator of the efficiency of e-tailing. This experience of the customer can
be accessed through proper customer service for feed backs and the problems faced by the
customer should be corrected by the e-tailer. Late delivery, wrong product, damaged
product etc can be some of the customer complaints which the e-tailer would have to sort
out.

E-tailers in India:-

Source: http://thestart.in/view/flipkart-vs-amazon-vs-snapdeal-an-in-depth-review-as-
customer

Flipkart.com:- Flipkart is an e-commerce company founded in 2007 by Sachin

Bansal and Binny Bansal. Where it is headquartered in Bangalore, Karnataka.Flipkart has
launched its own product range under the name "DigiFlip" with products including tablets,
USBs, and laptop bags. In May 2014, Flipkart received $210 million from DST Global, in
July 2014 it raised $1 billion led by existing investors Tiger Global and South Africa's media
group Naspers and in May 2015 it raised $550 million from some of its existing investors.
Flipkart's last fundraising round in May 2015 had pegged its valuation at $15 billion.

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Amazon: - Amazon arrived late to the Indian E-commerce domain, it started operation in
India on 5th June 2013, offering books movies and television shows as only products. The
founder of the company is Jeff Bezos, a cracker of a person and insanely passionate about the
business, customer service and innovation. Amazon is an American electronic
commerce and cloud computing company with headquarters in Seattle, Washington. It is the
largest Internet-based retailer in the United States. Amazon.com started as an online
bookstore later diversifying to
sell DVDs, Blurays,CDs, video downloads/streaming, MP3 downloads/streaming, audiobook
downloads/streaming, software, video games, electronics, apparel, furniture, food, toys and
jewelry. The company also produces consumer electronics notably, Amazon Kindle e-book
readers, Fire tablets, Fire TV and Fire Phone and is the world's largest provider of cloud
infrastructure services).

Snapdeal: - Snapdeal is an online marketplace, New Delhi, India. The company was started
by Kunal Bahl, a Wharton graduate as part of the dual degree M&T Engineering and
Business program at Penn, and Rohit Bansal, an alumnus of IIT Delhi in February 2010.
Investors in the company include Soft Bank Corp, Ru-Net Holdings, Tybourne Capital,
PremjiInvest,Temasek Holdings, Bessemer Venture Partners, Indo US Ventures, Kalaari
Capital, Saama Capital, Nexus Ventures, Intel Capital, and Ratan Tata. When Snapdeal
acquired Free Charge in an equity deal, investors Sequoia Capital India, Valiant Capital,
Sofina, Ru-Net Holdings, and Tybourne Capital became shareholders in Snapdeal.

Flipkart Vs Amazon Vs Snapdeal: Revenues & Losses Comparison:-

Amazon Vs Flipkart VS Snapdeal Better Service Wins: Amazon, Flipkart and Snapdeal are
the three largest retailers in the Indian e-commerce Industry. We all know online shopping in
India is growing at a very fast clip. At the same time, there is an intense competition in
ecommerce space, especially among the top 3 players. Another aspect that everyone is
probably aware about is, all this aggressive pricing and discounts are being paid by Venture
Capitalists’ pockets.

All
figures are in INR Crore

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Source: http://trak.in/tags/business/2014/11/06/flipkart-amazon-snapdeal-revenues-losses-
comparison

Flipkart leads the race with net revenue of 179 crore followed by Amazon at 168.9 crore and
Snapdeal at 154.11 crore. However, when it comes to losses, Flipkart leads by a much bigger
margin and their loss for 2013-14 stands at Rs. 400 Crore. Comparatively, Amazon losses are
pegged at Rs. 321.3 crore and Snapdeal had least losses of 3 with 264.6 crore.

Source:http://trak.in/tags/business/2014/11/06/flipkart-amazon-snapdeal-revenues-losses-
comparison
Flipkart leads the race here to losing 2.23 rupees for every 1 rupee of revenue. Amazon loses
1.90 and Snapdeal has least amount of losses at Rs. 1.72.

Conclusion: -
E-tailing offers unique advantages to the consumer that no other form of retailing can match.
The hypertext nature of the medium allows for more flexible forms of transactions (growth of
C2B and C2C) to flourish. It allows for easier comparisons across broad product categories
with the evolution of shopping bots and similar mechanisms. The medium also offers
flexible/dynamic pricing mechanisms to the consumer. These evolutions reduce any friction
in the online market place and stimulate the use of the web as a retail environment. In the
long-run, this will benefit the marketers as well as the consumers. Further, this will penalize
the marketers who thrived in market places that had entry barriers in the form of a lack of
freely available information. Earlier, such a situation restricted the customers in making
informed choices and led to inefficient pricing and localized monopolies.
E-tailing is a market practice that is still in its infancy. Viewing the Web as a
marketing tool, marketers incorporate the Web into their traditional strategies. Viewing the
Web as a new marketplace, businesses emerge with new product/ service designs, targeted
customers, and strategies. Traditional methods to evaluate the success of a business seem
insufficient in the new economy. Despite increasing sales, many e-businesses are not
profiting. In this developing market, many businesses aim to build a brand name and
customer base, while leaving profitability a long-term consideration. Research needs to be

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conducted to categorize e-market assumptions and assess their validity. With further research
and understanding, the Web retail market can prove to be a significant and profitable
marketplace.

References:-

 Jayakrishnan.S, E-retailing in India: Opportunities and Challenges, International Journal

of Research in Finance and Marketing, Volume 5, Issue 3 (March, 2015)
 Dr.Deepti Singh Verma Dr. Sonali Dube, E-Tailing - The Key to Modern Retailer's
Success, Altius Shodh Journal of Management & Commerce
 Prof. Jasbir Sodi, E-Tailing Boom – Impact on Retailing, Indian journal of applied
research, Volume: 4 , Issue : 9 ,September 2014
 Jyoti Arora, Prospect of E-Retailing In India, IOSR Journal of Computer Engineering
(IOSR-JCE) Volume 10, Issue 3 (Mar. - Apr. 2013), PP 11-15
 Mr. P. Sathish Chandra & Dr. G. Sunitha, E-Tailing – The Mantra Of Modern Retailer’s
Success, researchers world -Journal of Arts, Science & Commerce, Vol.– III, Issue 2(3),
April 2012
 http://tips.thinkrupee.com/articles/what-is-e-tailing.php
 http://www.freepatentsonline.com/article/Journal-Business-
Strategies/87206221.html
 http://smumanagementguru.blogspot.in/2015/06/e-tailing-advantages-and-
disadvantages.html
 http://blog.alrayeswebsolutions.com/2012/03/the-benefits-of-e-tailing-that-
you.html
 http://www.answers.com/Q/Advantages_and_disadvantages_e-tailing
 https://en.wikipedia.org/wiki/Snapdeal
 https://en.wikipedia.org/wiki/Flipkart
 https://en.wikipedia.org/wiki/Amazon.com

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MRKT140
GREEN MARKETING: CONCEPT AND ITS SCOPE IN
INDIA.
*Nikhil jay Ashwani,
*Assistant Professor, Department of Commerce& Management.

Dev Samaj College for Women Ferozepur.

ABSTRACT
Green marketing is a tool used by many companies in various industries to follow this trend.
There have been a lot of literature reviews on green marketing over the years, this paper
analysis the concept of green marketing and environmental safety using comprehensive
literature review. As a result, this paper can be used by researchers who need to understand
the concept of green marketing and environmental safety.

Keywords: Green Marketing, Consumer Satisfaction, Environmental Safety.

INTRODUCTION
These days, consumers are becoming more enlightened on environment and environmental
issues. Consumers are also aware of the environmental issues like; global warming and the
impact of environmental pollution. Green marketing has emerged as an important concept in
India, as in other parts of the developing and developed world. According to the American
Marketing Association, green marketing is the marketing of products that are presumed to be
environmentally safe. Thus green marketing incorporates a broad range of activities,
including product modification, changes to the production process, packaging changes, as
well as modifying advertising "Green Marketing" refers to holistic marketing concept
wherein the production, marketing, consumption and disposal of products and services

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happen in a manner that is less detrimental to the environment. With the growing awareness
about the implications of global warming, non-biodegradable solid waste, harmful impact of
pollutants consumers are becoming increasingly sensitive towards the need for shifting to
green products and services, this shifting to "green" may appear to be expensive in the short
run,but it will definitely prove to be indispensable and profitable in the long run.

WHAT IS GREEN MARKETING

The holistic management process responsible for identifying, anticipating and satisfying the
requirements of customers and society, in a profitable and sustainable way (Peattie, 1995)‖ .

The marketing or promotion of a product based on its environmental performance or an

improvement thereof (Charter & Polonsky 1999)‖ .

As resources are scars and human wants are unlimited, it is dire need of the marketers to
utilize the resources efficiently to achieve the organization's objective without wastage. So
green marketing is indispensable. There interest among the consumers is growing all over the
world and people are getting serious regarding the protection of the environment. As a result
of this, green marketing has emerged, which gives the idea of creating a market with
sustainable and socially responsible products and services. Now we see that most of the
consumers are becoming more aware and concerned about environment-friendly products.

Green marketing consists of all activities designed to generate and facilitate any exchanges
intended to satisfy human needs or wants, such that the satisfaction of these needs and wants
occurs, with minimal detrimental impact on the natural environment. It is sorry to say, a
greater part of people believe that green marketing refers solely to the promotion or
advertising of products with environmental characteristics. Terms like Phosphate Free,
Recyclable, Refillable, Ozone Friendly, and Environmentally Friendly are some of the things
consumers most often associate with green marketing. While these terms are green marketing
claims, in general green marketing is a much broader concept, one that can be applied to
consumer goods, industrial goods and even services. For example, around the world there are

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resorts that are beginning to promote themselves as "ecotourist" facilities, i.e., facilities that
"specialize" in experiencing nature or operating in a fashion that minimizes their
environmental impact (May 1991, Ingram and Durst 1989, Troumbis 1991). Thus green
marketing incorporates a broad range of activities, including product modification, changes to
the production process, packaging changes, as well as modifying advertising. Yet defining
green marketing is not a simple task. Indeed the terminology used in this area has varied, it
includes: Green Marketing, Environmental Marketing and Ecological Marketing. This early
definition has three key components, such as it is a subset of the overall marketing activity; it
examines both the positive and negative activities; and narrow ranges of environmental issues
are examined.

OBJECTIVES

 To understand the concept of going green and green marketing.

 To know and understand the need of green marketing.

 To explore the future and challenges faced by companies nowadays while pursuing
green marketing activities.

 Whether the consumer purchasing decisions in india are influenced by the green
marketing practices undertaken by the companies

WHY IS GREEN MARKETING IMPORTANT

The question of why green marketing has increased in importance is quite simple and relies
on the basic definition of Economics:

Economics is the study of how people use their limited resources to try to satisfy unlimited
wants.

Thus mankind has limited resources on the earth, with which she/he must attempt to provide
for the worlds' unlimited wants. In market societies where there is "freedom of choice", it has
generally been accepted that individuals and organizations have the right to attempt to have
their wants satisfied. As firms face limited natural resources, they must develop new or
alternative ways of satisfying these unlimited wants. Ultimately green marketing looks at
how marketing activities utilize these limited resources, while satisfying consumers wants,
both of individuals and industry, as well as achieving the selling organization's objectives.

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THE FOUR Ps OF GREEN MARKETING

When new innovations are developed by companies such as eco friendly products, the
companies gain entry into new markets, they enhance their total market shares, and they also
increase their profits. Just as we have the conventional 4Ps of the marketing mix i.e., product,
price, place and promotion, we have the 4Ps of green marketing as well. However, they are
slightly different. The 4Ps of the green marketing mix are as follows:

PRODUCT

 Products made from recycled goods, and housing materials made from recycled
goods.

 Products that can be recycled or reused.

 Efficient products, which save water, energy or gasoline, save money and reduce
environmental impact.

 Products with environmentally responsible packaging. McDonalds, for example,

changed their packaging from polystyrene clamshells to paper.

 Products with green labels, as long as they offer substantiation.

 Organic products — many consumers are prepared to pay a premium for organic
products, which offer promise of quality. Organic butchers, for example, promote the
added qualities such as taste and tenderness.
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 Certified products, which meet or exceed environmentally responsible criteria.

PLACE

The choice of where and when to make a product available has a significant impact on the
customers being attracted. Very few customers go out of their traditional way to buy green
products merely for the sake of environment. Marketers which are desperate to introduce new
green products should position themselves broadly in the market place so that they are not
just appealing to a small green niche market, the location must also be consistent with the
image which the company wants to project in the market and to the customers. The location
must differentiate a company from its competitors. This can be achieved by in-store
promotions and visually appealing displays or using recycled materials to emphasize the
environmental and other benefits.

PRICE

Pricing is a critical element of the marketing mix. Most customers are prepared to pay a
premium price if there is a perception of additional product value. This value may be:
improved performance or taste. Environmental benefits are usually an added bonus but will
often be the deciding factor between products of equal value and quality.

PROMOTION

Promoting products and services to target markets includes paid advertising, public relations,
sales promotions, direct marketing and on-site promotions. Smart green marketers will be
able to reinforce environmental credibility by using sustainable marketing and
communications tools and practices. For example, many companies in the financial industry
are providing electronic statements by email, e-marketing is rapidly replacing more
traditional marketing methods, and printed materials can be produced using recycled
materials and efficient processes, such as waterless printing. Retailers, for example, are
recognizing the value of alliances with other companies, environmental groups and research
organizations when promoting their environmental commitment. To reduce the use of plastic
bags and promote their green commitment, some retailers sell shopping bags, under the
banner of the Go Green Environment Fund. The key to successful green marketing is
credibility. Never overstate environmental claims or establish unrealistic expectations, and
communicate simply and through sources that people trust.

INITIATIVES TAKEN UP BY INDIAN COMPANIES TOWARDS

GREEN MARKETING
Lead Free Paints From Kansai Nerolac.

Kansai Nerolac Paints Ltd., has always been committed to the welfare of society and the
environment. Kansai Nerolac has worked on removing hazardous heavy metals from their
paints. Lead in paints especially poses danger to human health where it can cause damage to

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Central Nervous System, kidney and reproductive system. Children are more prone to lead
poisoning leading to lower intelligence levels and memory loss.

Tata's “Going green” Mantra.

Tata Motors is setting up an eco-friendly showroom using natural building material for its
flooring and energy efficient lights. The Indian Hotels Company, which runs the Taj chain, is
in the process of creating Eco rooms which will have energy efficient mini bars, organic bed
linen and napkins made from recycled paper. And when it comes to illumination, the rooms
will have CFLs or LEDs.

Oil and Natural Gas Company (ONGC) .

India’s largest oil producer, ONGC, is all set to lead the list of top 10 green Indian companies
with energy-efficient, green crematoriums that will soon replace the traditional wooden pyre
across the country. ONGC’s Mokshada Green Cremation initiative will save 60 to 70% of
wood and a fourth of the burning time per cremation.

IndusInd Bank.

Green banking has been catching up as among the top Indian green initiatives ever since
IndusInd opened the country’s first solar-powered ATM and pioneered an eco-savvy change
in the Indian banking sector.

CONCLUSION

Green marketing is still in its initial stage in India and more research needs to be undertaken
on different aspects of green marketing to explore its potential to the maximum possible
extent. When companies adopt green marketing activities, they should not neglect the
economic aspects of marketing. With the help of understanding of the implications of green
marketing, activities must be undertaken by the companies to ensure the competitive
advantage in the markets.

The companies must keep in mind that the consumers are very keen about the environmental
issues emerging in the country and are very much willing to pay a premium price for the
„green‟ products, if these eco-friendly products provide an extra value to the consumers.

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Companies can command a higher price if they can enhance the products performance and
offer extra product value, by providing better visual appeal, improved performance, better
design, or better taste. Thus, companies must try to locate these opportunities and must take
advantage of them.

REFERENCES

 Environmental Claims". Federal Trade Commission. 2008-11-17. Retrieved 2008-11-

17.
 The Age of Persuasion (January 8, 2010). "Season 5: It's Not Easy Being Green:
Green Marketing". CBC Radio. Retrieved 8 January 2011.
 Brahma, M. & Dande, R. (2008), The Economic Times, Mumbai.
 Donaldson, R. H. (2005), ―Green brands, NZ Marketing Magazine, 24(8), 14–17.
 Kotler, Philip. Marketing Management – The Millennium Edition Prentice Hall of
India Private Limited, New Delhi.
 McIntosh, A. (1990), "The impact of environmental issues on marketing and politics
in the 1990s", Journal of the Marketing Research Society, Vol. 33 No.3, pp.205-17.
 Hawkins, D.I., Best, R.J., Coney, K.A. (1998). Consumer Behaviour: Building Market
Strategy. McGraw-Hill, Boston, MA, pp 24-42
 Polonsky, Michael Jay. 1994b. "A Stakeholder Theory Approach to Designing
Environmental Marketing Strategy." Unpublished Working Paper.
 www.google.com
 www.greenpeace.org/international.
 www.greenmarketing.net/stratergic.html
 www.emeraldinsight.com/0263-4503.html
 www. Businesswireindia.com.

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MRKT141
VISUAL MERCHANDISING: A TOOL TO SALE
MAXIMIZATION
*Kanwal Jagjit Singh Sidhu
*Assistant Professor, Punjabi University Campus, Maur, Bathinda

*E-mail: [email protected], Contact No.: 8283808913

Abstract

The aim of this study is to find out the importance of visual merchandising in increasing the
appealing value of a retail outlet thus leading to rise in sales. Visual merchandising is an activity
of promoting the sale of goods, especially by their presentation and display. This study was
conducted during my tenure as operations manager with Bharti Retail Ltd., as the store faced
problem due to non movement of few products. Due to fewer sales the products got expired and
the store suffered as the expired products are to be destroyed. The questionnaire was used to
study 5 main products which had zero sales, even though these products had large benefits. The
respondents were selected on their frequency of visit and quantity of purchase bucket. The store
made changes as per the outcome of customer questioning and this resulted in boosting of sales.

Keywords: Merchandising, Sales Maximization, Rise in profits, Visual impact on sales

INTRODUCTION

Visual merchandising is a retail strategy that maximizes the display and look of a product with the
intent to increase sales. It can be defined as an activity of promoting the sale of goods, especially
by their presentation in retail outlets. Visual merchandising can also play a role in the look, feel
and culture of a brand. Done well, it can create awareness while simultaneously increasing brand
loyalty. Most importantly, it can draw customers in and close the sale – all based on the aesthetic
quality of your retail display.

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Visual Merchandising in a store

______________________________________________________________________________
___

Components of Visual Merchandising

The major components of merchandising which are essential for improvement of sales within any
retail outlet are:-

Product

Location
Packaging

Signage
Product

Display Components of

Visual
Merchandising

Product Knowledge
Inventory
To Sales Persons

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1. Product Location
It refers to the location of product within the store i.e. the area where the product is displayed.
Sometimes the product display is not visible to the potential customer. Hence the sale of the
product remains zero.

2. Packaging
Attractive and convenient packaging also helps increase the sales of the product. We have often
seen that various companies introduce different types of packaging suiting all types of customers.
Example packaging based on quantity (Pepsi comes in 600ml, 1.5Litres and 2Litres) or on type
of packaging material (Verka ghee comes in tin and tetra pack)

3. Signage
Signage is the sign or the marking that is displayed at various store locations to convey customers
about pricing and other discounts.

4. Product knowledge to salesperson

The outlet staff should have complete product knowledge, so that any kind of customer queries
regarding any product can be solved. A well trained staff can boost the sales and customer
confidence in the store by answering customer queries.

5. Product Display
The product display should be attractive to the customers. It should always give customers a
sense of newness. The retail stores choose different themes based on festivals like diwali, holi,
new year etc in displaying of products.

6. Inventory
Inventory refers to the goods stocked for future use. Every retail chain has its own warehouse to
stock the merchandise to be used when the existing stock is sold out. The store should maintain
the stock level so that customers demand is fulfilled. Sometimes there is proper advertising and
signage but sales suffer due to non availability of stock.

Apart from above other factors of visual merchandising include the store’s appearance, lighting,
uniforms, menus, point of sale material, color, shapes, textures, presentation and the “wow”
factor each of these elements bring together in a retail setting When these elements come

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together to showcase a brand, it enriches the customer experience, leading to a positive shopping
experience and increased sales.

Benefits of Visual Merchandising:

The visual merchandising helps in fulfilling following objectives that result in sale and profit
improvement.

1. Reducing product searching time

Due to complex store structure or display, the customers easily miss some displayed products.
With products clearly visible the customers can save their time and can also help in product
selection.

2. Increases customer visits

Due to proper merchandising there is increase in customer loyalty. This loyalty also helps in
worth of mouth promotion of the store.

3. Store looks clean

A well merchandised store also promotes store cleaning standards. Due to proper management of
stock the inventory levels also increase. The damage and expiry of products is also minimized.

4. Brand promotion

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Proper signage of prices, discounts, products benefits helps in spreading awareness about the
product among customers. Due to this increase in product awareness among the customers, the
sales go up.

5. New product promotion

The new products are promoted by visual merchandising; these products are mostly displayed at
the front of the store. The new products are given main location in the store and the displays are
properly themed.

Company Profile

Easyday is an Indian retail brand that runs chains of consumer retail department stores. The brand
is wholly owned by Bharti Enterprises Limited and is operated by its subsidiary, Bharti Retail
Limited, which is headquartered in New Delhi. The technical and management support was
provided by Walmart.

Future Group, that owns and operate Big Bazaar, combined retail operations with Easyday in
May 2015. The merger has created one of India's biggest retail chains with more than 570 stores
in 243 cities in India. Easyday has more than 200 Easyday Supermarkets and 15 Hypermarket
Stores spread across India.

In supermarkets the company offers attractive prices on a wide range of everyday grocery,
personal care, household need products including fresh fruits, vegetables, dairy products, meat
and poultry. In Hypermarkets, in addition to everyday food & grocery products the company has
an exciting range of apparel, electronics, kitchen ware, toys & stationary, etc. making it a
complete one stop shop for all your monthly needs. At a retail in-store
level, merchandising refers to the variety of products available for sale and the display of those
products in such a way that it stimulates interest and entices customers to make a purchase. This
research was done by me when I was operations manager with Bharti Retail Ltd. to check the low
movement of few products in the store. As a pilot project I chose five items with low sales.

LITERATURE REVIEW

Mehta and Chugan, (2012) has studied the contact of visual merchandising on shopper impulse
buying behavior. He took sample size of 84 customers visiting the retail stores of India and find

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that window display has direct relation with impulse buying. However no significant relation is
found between form display and impulse buying but floor merchandising shows direct relation.

Sujata, (2012) has shown impulse buying as an antecedent to impulse buying. He has taken
window display, form display, floor merchandising as independent variables. He has taken
sample comprising of both male and females of age 18-45 and applied Pearson correlation. His
conclusion is the strong correlation among window display, impulse buying and forum display.
Low correlation is found between impulse buying and floor merchandising.

Vinamra, (2012) has studied impact of visual merchandising on consumer behavior towards
toward women's Apparel. His dependent variable is visual merchandising and independent
variables are neutral role in influencing the purchase and significant role in influencing the
purchase. He took sample size of 150 Indian women’s who were visiting shopping malls. His
findings are that visual merchandising has a very strong impact on customer purchasing behavior.
To some extant visual merchandising also leads to impulse buying.

Maria, (2010) has studied the impact of visual merchandising in shopping center’s fashion stores.
His dependent variable was visual merchandising and independent variables were shopping store
window according to gender, Factors valued by consumer on going into a store attributes that
influence on purchase options according to gender. He took sample of 334 respondents and
applied mean standard deviation as a statistical tool. His findings are that significant differences
in the shopping center window display influences over consumer buying behavior according
gender, little significant differences in the factors valued by consumers on going into a shopping
center according to gender.

Ridmi, (2011) has studied the impact on patronage intentions in supermarkets of selected visual
merchandising techniques. His dependent variable is visual merchandising an independent is
store layout, color, product display, music, lighting, cleanliness. He took sample of 384
customers who are visiting shopping malls of Siri Lanka and applied regression as a statistical
tool. His findings are that no relationship between patronage intentions and store layout. There is
bond among color and patronage intentions. There is relationship between patronage intentions
and product display. There is relationship between patronage intentions and music. There is
connection among cleanliness and patronage intentions.

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Kanika Anand (2012) Deputy Manager- Visual merchandising, Boggi Milano

DLF Brands Ltd, India. In the article “Inspired by the world of Art” states that “Indian retail is
moving into ‘Second Gear’ with extensive attempts to constantly meet customer expectations.
Given the shift of gear from merely creating awareness, it has its own advantage to harness and
challenges to overcome” She further states that “ Creating strong foundations for consumerism
based societies, we are moving towards a first world fantasy where one does not buy a product,
but an experience. Shopping malls, Hypermarkets, Branded outlets and even small time retailers
understand and acknowledge the need and importance of VM to generate great business”. Her
opinion for consumer trends and behavior is that Indian consumers are turning increasingly
global in their outlook having become much more aware of design trends in the business of
fashion, hence demanding the same levels of design and innovations from store spaces. Customer
recognition and loyalty is essential to make consistent business but lack of innovation is
hindering the creation of distinct retailer’s identities thus challenging their strong up-ward
force/push towards Visual merchandising.

Sonali and Sunetra, (2012) has studied the unplanned purchasing triggering the senses in retail
stores. His dependent variable was frequency of shopping and independent was gender of
customers. He has taken sample of 100 customers visiting Indian shopping malls and used chi-
square as a statistical too. His findings were that no significantly associated with gender of
customers and frequency of shopping.

RESEARCH METHODOLOGY:

The research is for exploring the reasons for low sale or non moment of few products in a retail
store. The questionnaire used for survey was kept precise as the customers felt annoyed in filling
long questionnaire while shopping. The customers were selected on random basis. The sampling
size was kept to 30.

Research Objectives

1. To explore reasons for non movement of items.

2. To study the impact of visual merchandising on these products.

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3. To study the change in consumer buying pattern.

DATA ANALYSIS

1. Customer Response about the presence of products.

Customer Response
30

25
Customer Count

20

15

10

0
yes no
Response

As per questionnaire out of 30 customers, 25 were not aware of the presence of products
available in the store. Hence it resulted in low movement of products. This also increased the
expiry level of various products. So the products that can boost the store sales results in
occurrence of losses.

2. Reasons for customer response

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Customer Survey

14
12
Customers

10
8
6
4
2
0
No Product Knowledge Location of Product In Benefits of Product
store
Customer Response

Maximum customers didn’t have product knowledge so the sales were low. Other reasons were
lack of knowledge about various benefits that the product offers. The location of product i.e. the
area in the store where product is displayed in the store also reduces the sales.

3. Improvement in sales
With customer response and implementation of changes the sales of products gradually went up
within one month. So with success of this pilot project, the store implemented this on some other
low selling products.

Monthly Sales

30

25

20
Sales

15

10

0
Gripe Water Peanut Butter Carrenberry Juice Ice Tea Cow Desi Ghee
Items

FINDINGS AND LIMITATIONS OF THE STUDY

Findings

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1. It was found that majority of respondents were not aware of the product/item present
in the store. And many of them didn’t know the benefits offered by the product.
2. After studying the consumer response the store management changed the location of
these products to more visible areas. Then the products were highlighted with their
price and use of product. We also mentioned commonly used recipe of few products.
3. Due to these efforts the sales started increasing within month. This was implemented
in many stores across the country.
4. The customer’s queries increased regarding these products. And same changes were
made in some other items in the store.

Limitations

1. The questionnaire was kept precise so that customers didn’t get annoyed; due to this some
other facts may have been missed.

2. The customers were selected on random and judgment basis.

REFERENCES

Comyns, B. Impact of Visual Merchandising on University of New Hampshire Students.

Retrieved from [email protected]

Shoop, & Bastow, H., Visual merchandising – a guide for small retailers, Retrieved from
North Dakota State University; The Ohio State University.

Kinsey, M., 2011, Report on Indian Retail Sector: The Impact of Visual Merchandising on
Impulse Buying.Retrieved from EBSCOhost

Neha, P., & Chugan, P. Behavior of Consumer: A Case from Central Mall of Ahmedabad
India. Retrieved from EBSCOhost

Bhatti, K.L., & Latif, S.The Impact of Visual Merchandising on Consumer Impulse Buying
Behaviour. Retrieved from EBSCOhost

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MRKT142

Empowerment of the Bottom of the Pyramid Market:

Entrepreneurship Education

*Pooja Sharma
*Assistant Professor, Department of Humanities &Managemnt Studies, GZSCCET Bathinda.

ABSTRACT

Entrepreneurship is not only about creating the plans for business but also to commence new
ventures. Creativity, Innovation and economic growth work as catalysts for entrepreneurs.
We can develop future opinion leaders by developing high- potential students by imparting
entrepreneurial education at universities. The research paper will highlight the importance of
economic and social benefits of young growing enterprises and need of entrepreneurship
education at the “ Bottom of the Pyramid”. Social Inclusion is a matter of serious concern in
the future.

The most essential reason for the concept of entrepreneurship at the grass-roots is to find
sustainable solutions to overcome the injustices of poverty. It will recognize the role of social
entrepreneurs and to develop strategies to increase the number of people attracted to
entrepreneurship education at the Bottom -of -the - Pyramid.

Key words: Entrepreneurship Education, Bottom of the Pyramid, Social Inclusion, Social
Entrepreneurs.

INTRODUCTION

Entrepreneurship has been identified as a mechanism to remove poverty(Hart,2007; Matten

and Crane,2005; Peredo and Chrisman, 2006).Poverty is more prominent in ‘Base of the
Pyramid’(BOP) regions. Indeed, a lot of the socio - economic groups are suffering from
Social Exclusion. Social Exclusion implies when a person is denied to access the equal
opportunities (Behrman et al.,2003) There is another broader term “Social
Entrepreneurship”where entrepreneurs play change agents role by developing a goal to create
and sustain social value(Peredo and McLean,2006).It has been even suggested by
Prahalad(2007) that there are many creative entrepreneurs from the BOP .In spite of this
fact,some researchers have still been mulling over the fact that how entrepreneurship emerges

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within these communities(Hall et al.,2010;Webb et al.,2009).The importance of

entrepreneurship may be peculiarly envisaged in under- developed regions.

The prime cause is the gravity of economic and social problems. There can be negative
repercussions of Entrepreneurship as well, (Baumol,1990);Bowenand De
Clercq,2008,Smallbone and Welter,2001),particularly in some industries like
tourism(Agarwal and Brunt,2006;Ap,1992;Ryan,1993;Stonich,1998).Baumol(1990) assumes
the possibility of productive entrepreneurship and destructive outcomes which lead to
negative activities like criminal behaviour. According to Baumol and Schumpter (1934)
,entrepreneurs are innovative and creative. Kirzner’s (1973) alert entrepreneurs’ prove his
divergent approach and justifies that alert entrepreneurs are productive, unproductive and are
more apt in BOP settings due to unstable institutional settings and lack of access to proper
education.

BOP – Bottom of the pyramid

The term BOP was first coined by C.K. Prahalad , Harvey C Frueharf , Professor of Business
Administration ,University of Michigan Business School, in his book, ‘The Fortune at the
Bottom of the Pyramid: Eradicating Poverty through profits’. He explained the distribution of
wealth and the spending capacity of the world population (Prahalad and Hart,2002).

Major potential BOP markets in the world like China ,India, Mexico, Russia, Brazil, South
Africa ,Thailand, Turkey and Indonesia with a combined population of about 300 crores
,represents 70% of the world’s BOP population .Prahalad viewed with a business orientation
while Hart had a perspective of sustainable development.

Entrepreneurship And Education

C.K. Prahalad, together with Stuart Hart, launched the BOP idea in 1997 via the world wide
web, in a working paper: ‘Strategies for the Bottom of the Pyramid’. They chose the web
because the article was in their view, too radical to be published in a traditional journal. The
basis of Prahalad’s (2006: xvi) idea is a question: “What if we mobilized the resources, scale
and scope of large firms to co-create solutions to the problems at the bottom of the pyramid

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(BOP), those 4 billion people who live on less than $2 a day?”. Prahalad had a business
orientation to the problem, whereas Hart approached it in a perspective of sustainable
development. Prahalad believes his idea to be a radically different view of the world’s poor
and of business processes. Gradually, BOP has become known in Europe and European
companies are exploring the opportunities. Think about Phillips and the development of a
woodstove in 2005. BOP in Europe could perhaps introduce the beginning of the end for
Europe’s model of social market economy.

The theoretical origins of Europe’s market economy differ from America. Milton Friedman
argued that the only goal for a business company is to make profits. To Adam Smith, the very
early proponent of the invisible hand and the free market, strong, just and well functioning
government, at all levels, was central to and necessary condition for a sustainable successful
economy. Smith added that no society could develop properly economically, if any
significant group of members of society was significantly less well off than others; that there
should not exist unacceptable differences in incomes; that no society could be successful with
a large group of poor people; that the best way to advance the economy is to pay workers
decent wages. Remarkably enough, Anthony Giddens (2007) and Richard Sennett (2007)
seem to think along very similar lines, specifically for the U.K. anno 2007, and the future.

Selling to the poorest of the poor would become a mere business case. But there are
meaningful differences. Not much BOP-effect has been seen in Sub-Saharan Africa. In 1990
44.6% of the people were living on less than US$1 a day; in 2002 this was 44.0%. In 2006
Asia led the decline in global poverty (cf. The Millennium Development Goals Report 2007).
Surprisingly, or just not, most of the BOP-cases are located in India. It is highly unlikely that
Jeffrey Sachs and his associates will reach the elusive goal of halving world poverty by 2015
with the methods they envisage.The World Bank figure for poverty differs from the one
Prahalad uses. In 2001 it was estimated that 1.1 billion people had consumption levels below
US$1 a day and 2.7 billion people lived on less than US$2 a day (web.worlbank.org). The
World Bank set its reference lines at US$1 and US$2 per day in 1993 Purchasing Power
Parity terms. These two groups fit into two categories: extreme poverty and moderate
poverty. Prahalad focuses on the best of the worse, but he overestimates both scale and
viability of this intended market (Karnani, 2007).

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Hindustan Lever Limited (HLL), Indian subsidiary of Unilever, is one of the earliest
BOPexperiments (Prahalad, 2006). The company involved women in distributing their
products to remote villages. Other cases are Casas Bahia, selling top-quality brands in Brazil;
Coca-Cola offering carbonated soft drinks in smaller packs in India. According to its
supporters, BOP is more than selling Western products to the poor in developing countries.
BOP would create a: “portfolio of opportunities: new products, new services, new business
models, new technologies and partnerships (Buyle, 2007). In Mexico, Proctor & Gamble
(P&G) is offering a product to wash clothes with less water. Together with Unicef and
several other partners, P&G developed PUR, a water ‘purifying’ product, to provide safe
drinking water. AneelKarnani (2007) remains sceptical of BOP, as it is putting far too much
emphasis on the poor as consumers, instead of also being producers and users of the means of
production - preferably leading, at least in part, to self-supporting systems. When
consumption usurps ‘using’, reductionism of humans to mere clients, not even customers, is a
danger just around the corner (Lefebvre, 1997: 159, 196-198).

There are many conditions that can help to create entrepreneurship but a plain theoretical
study program or a creative idea is not enough. Entrepreneurship appears when the
opportunity meets and addresses someone with the right interest. Therefore, in order to bridge
the gap between a great design, idea or theory and a marketable product, there is a need for
inspiration and knowledge.

UNDERSTANDING THE SOCIAL ROLE OF ENTREPRENEURSHIP

Some researchers view the value of entrepreneurship as sustaining and creating national
wealth. The innovative entrepreneurs have pioneered some of the latest technologies
providing employment and improve the social and economic conditions of nations
(Audretsch,Keilbach and Lehmann, 2006; Baumol, 1986, 2010; Birch, 1979; McMullen and
Warnick, 2015). Social Entrepreneurship creates a impetus for growth for growth in
emerging,developed and less developed countries. Some researchers share the perspective
(Beaver and Jennings, 2005; Kets de Vries, 1985; Khan, Munir and Willmott, 2007;
Steinmetz and Wright, 1989; Wright and Zahra, 2011), that the social role of
entrepreneurship needs to be redefined and reconsidered.

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Entrepreneurship is considered vas a development tool by the business sector and the
government sector. There is a lack of understanding among people as to how to increase the
entrepreneurial successs because the lack of adequate facilities affects the small – scale
entrepreneurs.

The second generation BoPapproach outlines the business model of entrepreneurship, where
entrepreneurship is used as a mechanism to enhance the well being of the poor people. Being
a new concept, it is not yet clear on what types of supportive factors could generate
successful transformation to this initiative.

It is only recently that the business sector and the government sector have started to realize
the benefit of development through entrepreneurship apart from traditional development tools
such as grants, donations, or aid. Nevertheless, there is a lack of understanding and
investigation on “how”, “what” and “from whom” supports could be obtained to enhance the
BoP entrepreneur’s competencies that could eventually lead to entrepreneurship business
success. It is important to investigate the necessary supportive factors which will enable them
to be successful in their entrepreneurship business.

It is however expected that business success of the BoP entrepreneurs would facilitate the
enhancement of their well-being and thus contribute to the development of the society as a
whole. Based on this premise, the main objective of the research is to find through literature
review what level of impact has been created by the successful BoP entrepreneurship
business to the well-being among theBoP entrepreneurs. The review will examine the
influence of supportive factors and mediating role of entrepreneurial competencies which
make the entrepreneurship a successful venture in BoP context.

Entrepreneurship and education are two such extraordinary opportunities that need to be
leveraged and interconnected if we are to develop the human capital required for building the
societies of the future. Entrepreneurship is the engine fuelling innovation, employment
generation and economic growth. Only by creating an environment where entrepreneurship
can prosper and where entrepreneurs can try new ideas and empower others can we ensure
that many of the world’s issues private sector and be seen as the fundamental mechanism for
attaining sustainable economic development and societal progress.

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Entrepreneurship Education as one of the key drivers of sustained social development and
economic recovery. The research consolidates existing knowledge and good practices in
entrepreneurship education around three focus areas that cover the lifelong learning process
of an individual: youth, higher education and social inclusion. It also outlines specific
approaches that are needed for each one of these areas, as well as opportunities, challenges
and practical recommendations for key stakeholders.

Given the various forms of entrepreneurship both across and within regions and countries
around the world, this paper looks at three specific types of entrepreneurship: youth (with a
focus on disadvantaged youth), higher education (with a focus on growth/opportunity
entrepreneurship) and social inclusion, outlining the differing types of education approaches
needed for each. The paper identifies opportunities and challenges, highlights existing
entrepreneurship education tools and good practices and develops recommendations for
multistakeholder support of the development and delivery of effective educational
programmes for entrepreneurship.

While the first two forms of entrepreneurship education are self-explanatory, the third is more
complex. Entrepreneurship for social inclusion seeks growth by allowing more people –
especially marginalized ones such as the very poor, women in many contexts, minorities,
disabled and disadvantaged – to engage actively in productive economic activities. Social
Inclusion refers to an individual’s ability to turn ideas into action and is therefore a key
competence for all, helping young people to be more creative and self-confident in whatever
they undertake (EC, 2008).

Entrepreneurship Education and Social Inclusion

The most fundamental reason for thinking about entrepreneurship at the grass roots is to find
sustainable solutions to overcome the injustices of poverty. The social injustice of poverty is
evidenced by malnutrition, low life expectancy, indifferent educational attainment, poor
access to water, inadequate healthcare and exclusion from the benefits of economic and
technological progress.

Main Drivers for Social Inclusion through Entrepreneurship Social inclusion is a matter of
urgent need across much of the world. Poverty indicators, the distancing of the rich from the

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poor, access to income generating resources, water, the impact of climate change the need for
better health, civil rights and provision of basic needs identified in the UN Millennium Goals
all create a sense of imperative.

Since the major changes of the early 1990s – such as the fall of the Berlin Wall and the
economic policy reforms in China and India – we now have, in effect, one world economic
system. This has led to a doubling of the workforce, from 1.5 billion to 3 billion. The
pressures on creating jobs, incomes and sustainability have also led to large-scale economic
migrations and further pressures on political and social system

Social entrepreneurs have gone into business sectors and helped solve problems for people in
their communities. They have taken the agenda beyond free trade to fair trade, created
opportunities at the base of the pyramid resulting in more people with income, health,
education and improved welfare.

Entrepreneurship is seen as a potential solution to many of the barriers to social inclusion and
the provision of education is seen as a method for empowering these improvements.

Conclusion and Suggestions

In the end, we conclude that social inclusion is not just about training the “poor’’. It is also
about training those on the supply side of policy, including educational institutions, civic
organizations, business development agencies and NGOs.

This target group needs to discuss the role of entrepreneurship education, entrepreneurial
finance, fair play, regulations, managing civic administration, banking rules and so forth.
They need to understand and feel the emotional content of entrepreneurs, the mindset of
individuals who put their families and livelihoods at risk. They also need role models of
entrepreneurs as change agents in society, demystifying entrepreneurship for policy, civic
administration and education. They need to feel and understand the overall cultural barriers to
enterprise and work towards creating higher levels of aspiration.

References:

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Audretsch, D. B., Keilbach, M. C., and Lehmann, E. E. (2006). Entrepreneurship and

Economic Growth. New York: Oxford University Press
Bandura, A., Freeman, W. H., Lightsey, R. Self-Efficacy : The Exercise of Control. In
Journal of Cognitive Psychotherapy,1999, 13, 2 :158-166(9).
Baumol, W.J. (1986). ‘Entrepreneurship: Productive, unproductive, and destructive’. Journal
of Business Venturing, 11(1), 3-22.

Baumol, W. J. (2010). The Microtheory of Innovative Entrepreneurship. Princeton: Princeton

University Press.
Baumol, W.J., Litan, R.E., and Schramm, C.J. (2007). Good Capitalism, Bad Capitalism, and
the Economics of Growth and Prosperity. New Haven: Yale University Press.

Beaver, G., and Jennings, P. (2005). ‘Competitive advantage and entrepreneurial power: The
dark side of entrepreneurship’. Journal of Small Business and Enterprise Development, 12(1),
9-23

Beck, U., Ritter, M. Risk Society: Towards a New Modernity. London: Sage Publications,
1992.
Bottomley, T. Farmer-Centred Enterprise for Agricultural Development. Cooperative action
in credit, supply and marketing. Plunkett Development Series No 9, 1989. Oxfordshire:
Plunkett Foundation for Cooperative Studies, 1989.
Hansemark, Ove C. Need for Achievement, Locus of Control and the Prediction of Business
Start-ups. A longitudinal study. In Journal of Economic Psychology, 2003, 24,3 :301-319.
Harper M. Their own idea. Lessons from workers’ co-operatives. Warwickshire: Intermediate
Technology Publications, 1992.
Hossain, M. Credit for the Rural Poor. Research Monograph:4. Bangladesh Institute of
Development Studies 1984.
Hurley, D. Income generation scheme for the urban poor. Oxford: Oxfam Publishing, 1990.
Kets De Vries, M. F. R. (1985). ‘The dark side of entrepreneurship’. Harvard Business
Review, 63(6), 169-167.

Khan, F. R., Munir, K. A., and Willmott, H. (2007). ‘A dark side of institutional
entrepreneurship: Soccer balls, child labor and postcolonial impoverishment’. Organization
Studies, 28(7), 1055-1077

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Kolb, D. A. Experiential Learning Theory and the Learning Style Inventory : A reply to
Freedman and Stumpf. In The Academy of Management review, 1981, 6,2 : 289 (0363-
7425).

London, T. and Hart, S. L. (2011). Next Generation Business Strategies for the Base of the
Pyramid: New Approaches for Building Mutual Value. Upper Saddle River: Pearson
Education

Myint, Y. M., Vyakarnam, S., New, M. The Effect of Social Capital in New Venture
Creation. The Cambridge High-tech Cluster. In Journal of Strategic Change, 2005.

Nahapiet, J., Ghoshal S. Social and intellectual capital and organisation advantage. In
Academy of Management Review, 1998, 23,2 : 242-266.
Prahalad, C.K. (2005). The Fortune at the Bottom of the Pyramid: Eradicating Poverty
through Profits. Upper Saddle River: Wharton School Publishing.

Prusak, L. Knowledge in Organizations. Butterworth-Heinemann, 1997.Rae, D., Carswell, M.

Towards a conceptual understanding of entrepreneurial learning. In Journal of Small Business
and Enterprise Development, 2001, Vol. 8, No.2 :150-8.

Steinmetz, G. and Wright, E. O. (1989). ‘The fall and rise of the petty bourgeoisie: changing
patterns of self-employment in the postwar United States’. American Journal of
Sociology,94(5), 973-1018.

Swartland, J. R. A Study of Entrepreneurship Education in Botswana. Presented at the

Biennale on Education in Africa in 2008. Association for the Development of Education in
Africa.
Vyakarnam, S., Adams, R. Institutional Barriers to Enterprise Support : An empirical study.
In Environment and Planning C:Government and Policy, 2001, 19 : 335-353.

Vyakarnam, S. When the harvest is in. Developing rural entrepreneurship. Intermediate

Technology Publications, 1990.

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MRKT143
Green And Sustainable Marketing
*Dr. Seema Sharma **Dr. Archana Pathak
* **Department of Chemistry , GZSCCET, Bathinda

*[email protected] **[email protected]

Abstract:

Green marketing is the current issue of marketing of products that are presumed to be
environmentally preferable to others. Thus green marketing incorporates a broad range of
activities, including product modification, changes to the production process, sustainable
packaging, as well as modifying advertising. This will be the existence of varying social,
environmental and retail definitions attached to this term. Other similar terms used
are environmental marketing and ecological marketing. Green, environmental and eco-
marketing are part of the new marketing approaches which do not just refocus, adjust or
enhance existing marketing thinking and practice, but seek to challenge those approaches and
provide a substantially different perspective. In more detail green, environmental and eco-
marketing belong to the group of approaches which seek to address the lack of fit between
marketing as it is currently practiced and the ecological and social realities of the wider
marketing environment.

Keywords: Green marketing, Product modification, ecological marketing, sustainable

packaging

Introduction:

The term Green Marketing came into prominence in the late 1980s and early 1990s.[1][2] The
Corporate Social Responsibility (CSR) Reports started with the ice cream seller Ben & Jerry's
where the financial report was supplemented by a greater view on the company's
environmental impact. In 1987 a document prepared by the World Commission on
Environment and Development defined sustainable development as meeting “the needs of the
present without compromising the ability of future generations to meet their own need”, this

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became known as the Brundtland Report and was another step towards widespread thinking
on sustainability in everyday activity. Two tangible milestones for green marketing came in
the form of published books. They were by Ken Peattie (1992) in the United Kingdom and
by Jacquelyn ottman (1993) in the United States of America.[3-7]

According to Jacquelyn Ottman(author of "The New Rules of Green Marketing: Strategies,

Tools, and Inspiration for Sustainable Branding"[8] 2011)) from an organizational standpoint,
environmental considerations should be integrated into all aspects of marketing — new
product development and communications and all points in between.[9] The holistic nature of
green also suggests that besides suppliers and retailers new stakeholders be enlisted,
including educators, members of the community, regulators, and NGOs.

The past decade has shown that harnessing consumer power to effect positive environmental
change is far easier said than done. The so-called "green consumer movement " movements
in the U.S. and other countries have struggled to reach critical mass and to remain in the
forefront of shoppers' minds.[10] Green marketing has continued to gain adherents,
particularly in light of growing global concern about climate change. This concern has led
more companies to advertise their commitment to reduce their climate impacts, and the effect
this is having on their products and services.[11]

Greenhouse gas reduction market

The emerging greenhouse gas reduction market can potentially catalyze projects with
important local environmental, economic, and quality-of-life benefits. The Kyoto Protocol’s
Clean Development Mechanism (CDM), for example, enables trading between industrial and
developing nations, providing a framework that can result in capital flows to environmentally
beneficial development activities.Greenhouse gas Ttrading can play an important role
supporting activities that benefit people’s lives and the environment.[12]

EXAMPLES OF GREEN MARKETING IN INDIA:-

1.Digital Tickets by Indian Railways. :- Recently IRCTC has allowed its customers to carry
PNR no. of their E-Tickets on their laptop and mobiles. Customers do not need to carry the
printed version of their ticket anymore.

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2.No Polythene carry bags for free :-Forest & Environmental Ministry of India has ordered to
retail outlets like Big Bazar,More,Central,D-Mart etc that they could provide polythene carry
bags to customers only if customers are ready for pay for it.

3. Green IT Project: State Bank of India:-By using eco and power friendly equipment in its
10,000 new ATMs, the banking giant has not only saved power costs and earned carbon
credits, but also set the right example for others to follow. SBI is also entered into green
service known as “Green Channel Counter”. SBI is providing many services like; paper less
banking, no deposit slip, no withdrawal form, no checks,no money transactions form all these
transaction are done through SBI shopping & ATM cards. State Bank of India turns to wind
energy to reduce emissions. The wind project is the first step in the State Bank of India's
green banking program dedicated to the reduction of its carbon footprint and promotion of
energy efficient processes, especially among the bank's clients.

4: Lead Free Paints from Kansai Nerolac:- Kansai Nerolac has worked on removing
hazardous heavy metals from their paints. The hazardous heavy metals like lead, mercury,
chromium, arsenic and antimony can have adverse effects on humans. Lead in paints
especially poses danger to human health where it can cause damage to Central Nervous
System, kidney and reproductive system. Children are more prone to lead poisoning leading
to lower intelligence levels and memory loss.

5.Wipro's Green Machines:-Wipro Infotech was India's first company to launch environment
friendly computer peripherals. For the Indian market, Wipro has launched a new range of
desktops and laptops called Wipro Greenware. These products are RoHS (Restriction of
Hazardous Substances) compliant thus reducing e-waste in the environment.

Greenwashing

The primary objective of greenwashing is to provide consumers with the feeling that the
organization is taking the necessary steps to responsibly manage its ecological footprint. In
reality, the company may be doing very little that is environmentally beneficial[16] The term
greenwashing was first used by environmentalist Jay Westerveld when objecting to hotelier's
practice of placing notices in hotel rooms which asked their guests to reuse towels to “save
the environment”. Westerveld noted that there was little else to suggest that the hoteliers were

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interested in reducing their environmental impacts. For greenwashing established and

numerous campaigns, law and advices developed in an attempt to reduce or curb it.[13-17]

Adoptability

In 1989, 67 percent of Americans stated that they were willing to pay 5-10 percent more for
ecologically compatible products. By 1991, environmentally conscious individuals were
willing to pay between 15-20 percent more for green products. Today, more than one-third of
Americans say they would pay a little extra for green products[18]

An important challenge facing marketers is to identify which consumers are willing to pay
more for environmentally friendly products. It is apparent that an enhanced knowledge of the
profile of this segment of consumers would be extremely useful.

Everett Rogers, communication scholar and author of “Diffusion of Innovations”, claims that
the following five factors can help determine whether a new idea will be adopted or not,
including the idealism of the shift towards “green”:

1. Relative advantage: is the degree to which the new behavior is believed to accrue
more beneficial outcomes than current practice.
2. Observability: is how easy it is to witness the outcomes of the new behavior.
3. Trialability: is the ease with which the new behavior can be tested by an individual
without making a full commitment.
4. Compatibility: is the degree to which the new behavior is consistent with current
practice.
5. Complexity: is how difficult the new behavior is to implement.[19]

LOHAS stands for Lifestyles of Health and Sustainability, and describes an integrated,
rapidly growing market for goods and services that appeal to consumers whose sense of
environmental and social responsibility influences their purchase decisions. The Natural
Marketing Institute’s (short: NMI) estimates the US LOHAS consumer market of products
and services to be USD 209 billion – sold across all consumer segments.[20]

The five LOHAS segments as defined by NMI include:

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 LOHAS: Active environmental stewards dedicated to personal and planetary health.

These are the heaviest purchasers of green and socially responsible products and the early
adopters who influence others heavily.
 Naturalites: Motivated primarily by personal health considerations. They tend to
purchase more LOHAS consumable products vs. durable items.
 Drifters: While their intentions may be good, DRIFTERS follow trends when it is
easy and affordable. They are currently quite engaged in green purchasing behaviours.
 Conventionals: Pragmatists who embrace LOHAS behaviour when they believe they
can make a difference, but are primarily focused on being very careful with their
resources and doing the ‘right’ thing because it will save them money.
 Unconcerned: Either unaware or unconcerned about the environment and societal
issues mainly because they do not have the time or the means – these consumers are
largely focused on getting by.

A model green marketing contains four "P's":

i.Product: A producer should offer ecological products which not only must not contaminate
the environment but should protect it and even liquidate existing environmental damages.

ii.Price: Prices for such products may be a little higher than conventional alternatives. But
target groups like for example LOHAS are willing to pay extra for green products.

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iii.Place: A distribution logistics is of crucial importance; main focus is on ecological

packaging. Marketing local and seasonal products e.g. vegetables from regional farms is
more easy to be marketed “green” than products imported.

iv.Promotion: A communication with the market should put stress on environmental aspects,
for example that the company possesses a CP certificate or is ISO 14000 certified. This may
be publicized to improve a firm’s image. Furthermore, the fact that a company spends
expenditures on environmental protection should be advertised. Third, sponsoring the natural
environment is also very important. And last but not least, ecological products will probably
require special sales promotions.[21]

Ecolabel
Independent organizations may choose to guarantee messages on the environmental benefits
of brands with environmental labeling systems. This practice tries to diminish perceived
biases in environmental information by promoting standardization of the information with the
aim of improving confidence in the evaluation of environmental benefits of products—all of
which should positively affect the purchase intention.[22]

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Overview of the different types of ecolabels used to indicate credibility to consumer.[23]

Life-cycle assessment

During the late 1980s, new instruments such as life-cycle assessment (LCA) were invented
which allowed ecological considerations to be introduced into marketing decisions. The life
cycle assessment model seeks to identify the main types of environmental impact throughout
the life cycle of a product. LCA was developed according to ISO 14040. The main goal of the
LCA is to define the energy and environmental profile of the finished products. The reasons
to use LCA arose from the need to have a precise process accounting and to highlight
potential improvements that could be used in order to increase the environmental, energy and
economic efficiency and overall effectiveness of the processes. In addition, the purpose was
to quantify the environmental advantages deriving from the use of recycled raw material.[24]

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Introduction of CNG in Delhi New Delhi the capital of India, was being polluted at a very
fast pace until Supreme court of India forced a change to alternative fuels. In 2002, a
directive was issued to completely adopt CNG in all public transport.[25]

CONCLUSION
Green marketing covers more than a firm's marketing claims. While firms must bear much of
the responsibility for environmental degradation, ultimately it is consumers who demand
goods, and thus create environmental problems. It appears that consumers are not overly
committed to improving their environment and may be looking to lay too much responsibility
on industry and government. Ultimately green marketing requires that consumers want a
cleaner environment and are willing to "pay" for it, possibly through higher priced goods,
modified individual lifestyles, or even governmental intervention. Until this occurs it will be
difficult for firms alone to lead the green marketing revolution.Final consumers and industrial
buyers also have the ability to pressure organizations to integrate the environment into their
corporate culture and thus ensure all organizations minimize the detrimental environmental
impact of their activities.

REFERENCES
1.Belz F., Peattie K.(2009): Sustainability Marketing: A Global Perspective. John Wiley &

Sons

2. "Environmental Claims". Federal Trade Commission. 2008-11-17. Retrieved2008-11-17.

3. Karl E., Henion; Thomas C. Kinnear (January 1976). "Ecological Marketing". Ecological

Marketing. American Marketing Association. p. 168. ISBN 0-87757-076-0, ISBN 978-0-

87757-076-9.

4. Dodds, John (August 11, 2006). "Geek Marketing 101". Retrieved January 2008.

5.Mendleson, Nicola; Michael Jay Polonsky (1995). "Using strategic alliances to develop
credible green

marketing". Journal of Consumer Marketing (MCB UP Ltd) 12 (2): 4–

18.doi:10.1108/07363769510084867.

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6.McDaniel, Stephen W.; David H. Rylander (1993). "Strategic green marketing". Journal of

Consumer Marketing (MCB UP Ltd) 10 (3): 4–10. doi:10.1108/07363769310041929.

7. Thomas L. Friedman (April 15, 2007). "The Power of Green". The New York Times.

8. Ottman, Jacquelyn (May 2002). "THE REAL NEWS ABOUT GREEN CONSUMING".
Retrieved January 2008.

9. Levinson, Jay Conrad; Horowitz, Shel (2010). Guerrilla Marketing Goes Green. John
Wiley &

Sons. ISBN 978-0-470-56458-5.

10.Shel Horowitz (June 14, 2013). "Marcal Rebrand Lets the World Know That It's Always
Been

Green". Sustainable Brands.

11."'Green' Sales Pitch Isn't Moving Many Products". Wall Street Journal. March 6, 2007.

12. Hanas, Jim (June 8, 2007). "Environmental Awareness Has Not Only Tipped in the
Media --

It's Hit Corporate Boardrooms as Well" (PDF). Advertising Age.

13.Orange, E. (2010): From eco-friendly to eco-intelligent. THE FUTURIST, September–

October 2010, 28-32.

14. King, Bart. "Patagonia Is First to Register for ‘Benefit Corporation’ Status in California".

Retrieved 2012-03-2

15. Coddington, W. (1990): It's no fad: environmentalism is now a fact of corporate life.

Marketing News, 15 October, 7.

16. Suchard, H.T. and Polonski, M.J. (1991): A theory of environmental buyer behavior and
its

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validity: the environmental action-behaviour model. in Gilly, M.C. et al. (Eds), AMA
Summer

Educators´ Conference Proceedings, American Marketing Association, Chicago, IL, 2, 187-

201.

17. Rogers, Everett (1995). New York: Free Press. ISBN 0029266718.

18. Todd, kaiser: Eco-marketing: a blooming corporate strategy, 2008.

19. Weinreich, Nedra. "What is Social Marketing?". Retrieved 2012-03-26.

20.Grundey, D. and Zaharia, R.M. (2008): Sustainable incentives in marketing and strategic

greening: the cases of Lithuania and Romania. Baltic Journal on Sustainability, 14(2), 130 –

143.

21. Montoro-Rios, F.J., Luque-Martinez, T. and Rodriguez-Molina, M.-A. (2008): How

Green

Should You Be: Can Environmental Associations Enhance Brand Performance?. Journal
of

advertising research, December 2008, 547-563.

22. Horne, R.E. (2009): Limits to labels: The role of eco-labels in the assessment of product

sustainability and routes to sustainable consumption. International Journal of Consumer

Studies, 33, 175–182.

23. Intini, F. and Kühtz, S. (2010): Recycling in buildings: an LCA case study of a thermal

insulation panel made of polyester fiber, recycled from post-consumer PET bottles.

International Journal of Life Cycle Assessment, 16, 306–315.

24.G. Fowler (2002-03-06). "Green Sales Pitch Isn't Moving Many Products". Wall Street

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Journal.

25."Successful Adoption of CNG and Emerging CNG-H2 Program in India" (PDF).

MRKT114
GREEN MARKETING IN Make IN INDIA
*Gagandeep Singh

Abstract
Green marketing is a phenomenon which has developed particular important in the modern
market. This concept has enabled for the re-marketing and packaging of existing products
which already adhere to such guidelines. Additionally, the development of green marketing
has opened the door of opportunity for companies to co-brand their products into separate
line, lauding the green-friendliness of some while ignoring that of others. Such marketing
techniques will be explained as a direct result of movement in the minds of the consumer
market. As a result of this businesses have increased their rate of targeting consumers who
are concerned about the environment. These same consumers through their concern are
interested in integrating environmental issues into their purchasing decisions through their
incorporation into the process and content of the marketing strategy for whatever product
may be required.This paper discusses how businesses have increased their rate of targeting
green consumers, those who are concerned about the environment and allow it to affect their
purchasing decisions. The paper identifies the three particular segments of green consumers
and explores the challenges and opportunities businesses have with green marketing. The
paper also examines the present trends of green marketing in India and describes the reason
why companies are adopting it and future of green marketing and concludes that green
marketing is something that will continuously grow in both practice and demand.

KEYWORDS ; Green marketing ,environment

INTRODUCTION
Although environmental issues influence all human activities, few academic disciplines have
integrated green issues into their literature. This is especially true of marketing. As society
becomes more concerned with the natural environment, businesses have begun to modify
their behavior in an attempt to address society's"new" concerns. Some businesses have been
quick to accept concepts like environmental management systems and waste minimization,
and have integrated environmental issues into all organizational activities. Some evidence of
this is the development of journals such as "Business Strategy and the Environment" and
"Greener Management International," which are specifically designed to disseminate research
relating to business' environmental behavior. One business area where environmental issues

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have received a great deal of discussion in the popular and professional press is marketing.
Terms like "Green Marketing" and "Environmental Marketing" appear frequently in the
popular press. Many governments around the world have become so concerned about green
marketing activities that they have attempted to regulate them (Polonsky 1994a). For
example, in the United States (US) the Federal Trade Commission and the National
Association of Attorneys-General have developed extensive documents examining green
marketing issues [FTC 1991, NAAG 1990]. One of the biggest problems with the green
marketing area is that there has been little attempt to academically examine environmental or
green marketing. While some literature does exist [Carlson, Grove and Kangun 1993, Davis
1992, Davis 1993], it comes from divergent perspectives. Elkington (1994: 93) defines green
consumer as one who avoids products that are likely to endanger the health of the consumer
or others; cause significant damage to the environment during manufacture, use or disposal;
consume a disproportionate amount of energy; cause unnecessary waste; use materials
derived from threatened species or environments; involve unnecessary use of, or cruelty to
animals; adversely affect other countries.

This paper will attempt 1) to introduce the terms and concepts of green marketing; 2) briefly
discuss why going green is important; 3) examine some of the reason that organizations are
adopting a green marketing philosophy; and 4) mention some of the problems with green
marketing.

LITERATURE REVIEW
Green marketing has been an important academic research topic since it
came.(Coddinton.1993;Fuller;1999;Ottman,1994).Attention was drawn to the subject in the
late 1970‘s when the American Marketing Association organized the first ever workshop on
―Ecological marketing‖ in 1975 which resulted in the first book on the subject entitled
―Ecological Marketing‖ by Henion and Kinnear in 1976. Peattie and Crane (2005) claims
that despite the early development, it was only in the late 1980‘s that the idea of Green
Marketing actually made an appearance because of the consumers growing interest in green
products. Green marketing was given prominence in the late 1980s and 1990s after the
proceedings of the first workshop on Ecological marketing held in Austin, Texas (US), in
1975. Several books on green marketing began to be published thereafter. The green
marketing has evolved over a period of time. According to Peattie (2001), the evolution of
green marketing has three phases. First phase was termed as Ecological" green marketing,
and during this period all marketing activities were concerned to help environment problems
and provide remedies for environmental problems. Second phase was "Environmental" green
marketing and the focus shifted on clean technology that involved designing of innovative
new products, which take care of pollution and waste issues. Third phase was "Sustainable"
green marketing. It came into prominence in the late 1990s and early 2000. During 1990s, the
concern for environment increased and resulted in to increasing challenges for the companies
(Johri and Sahasakmontri, 1998). Dutta, B. (2009, January) in his article on Green Marketing

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titled Sustainable Green Marketing The New Imperative published in Marketing Mastermind
states that Green Marketing involves developing good quality products which can meet
consumer needs and wants by focusing on the quality, performance, pricing and convenience
in an environment-friendly way. Barkar is of the view that, Companies need to believe first
that Green Marketing „can work‟ and make diligent efforts to make necessary product
improvements, which deliver performance, and are marketable and profitable. Unruh, G. And
Ettenson, R. (2010) in their research article titled, Growing Green: Three smart paths to
developing sustainable products. Published in Harvard Business Review, is for executives
who believe that developing green products make sense for their organization and need to
determine the best path forward. The authors have introduced and described three broad
strategies that companies can use to align their green goals with their capabilitie

WHAT IS GREEN MARKETING

Unfortunately, a majority of people believe that green marketing refers solely to the
promotion or advertising of products with environmental characteristics. Terms like
Phosphate Free, Recyclable, Refillable, Ozone Friendly, and Environmentally Friendly are
some of the things consumers most often associate with green marketing. While these terms
are green marketing claims, in general green marketing is a much broader concept, one that
can be applied to consumer goods, industrial goods and even services. For example, around
the world there are resorts that are beginning to promote themselves as "ecotourist" facilities,
i.e., facilities that "specialize" in experiencing nature or operating in a fashion that minimizes
their environmental impact [May 1991, Ingram and Durst 1989, Troumbis 1991]. Thus green
marketing incorporates a broad range of activities, including product modifcation, changes to
the production process, packaging changes, as well as modifying advertising. Yet defining
green marketing is not a simple task. Indeed the terminology used in this area has varied, it
includes: Green Marketing, Environmental Marketing and Ecological Marketing. While
green marketing came into prominence in the late 1980s and early 1990s, it was first
discussed much earlier. The American Marketing Association (AMA) held Polonsky: An
Introduction To Green Marketing 1 the first workshop on "Ecological Marketing" in 1975.
The proceedings of this workshop resulted in one of the first books on green marketing
entitled "Ecological Marketing" [Henion and Kinnear 1976a]. Since that time a number of
other books on the topic have been published [Charter 1992, Coddington 1993, Ottman
1993]. The AMA workshop attempted to bring together academics, practitioners, and public
policy makers to examine marketing's impact on the natural environment.

Meaning

Here, term ‘green’ is indicative of purity. Green means pure in quality and fair or just in
dealing. For example, green advertising means advertising without adverse impact on society.
Green message means matured and neutral facts, free from exaggeration or ambiguity. Green
marketing is highly debated topic for lay people to highly professional groups.

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Concept of green marketing concerns with protection of ecological environment. Modern

marketing has created a lot of problems. Growth in marketing activities resulted into rapid
economic growth, mass production with the use of advanced technology, comfortable and
luxurious life, style, severe competition, use of unhealthy marketing tactics and techniques to
attract customers, exaggeration in advertising, liberalization and globalization, creation of
multinational companies, retailing and distribution by giant MNCs, etc., created many
problems.

Departmental stores, specialty stores, and shopping malls are flooded with useful as well as
useless products. These all factors have threatened welfare of people and ecological balance
as well. Particularly, giant factories have become the source of different pollutions.
Production, consumption and disposal of many products affect environment adversely.

Excessive pollution has provoked the Nature and the Nature starts behaving in unnatural
ways (in form of global warming v/s global cooling, heavy rains v/s draught, and other
natural calamities like frequent earthquakes and tsunami, cyclones, epidemics, and so forth).
Economic growth via production and consumption threatens peaceful life of human being on
the earth. Green marketing is an attempt to protect consumer welfare and environment (the
nature) through production, consumption, and disposal of eco-friendly products.

Basically, green marketing concerns with three aspects:

1. Promotion of production and consummation of pure/quality products,

2. Fair and just dealing with customers and society, and

3. Protection of ecological environment.

Global ecological imbalance and global warming (also global cooling) have called upon
environmentalists, scientists, social organisations, and alert common men to initiate the
concrete efforts to stop further deterioration of ecological environment. The World Bank, the
SAARC, the UNO, the WHO, and other globally influential organisations have started their
efforts to promote and practice green marketing. The world environment summit at
Copenhagen (2009) is the mega event that shows the seriousness of ecological imbalance.

To increase awareness, 5th June is declared as the World Environment Day. Green marketing
emphases on protection of long-term welfare of consumers and society by production and use
of pure, useful, and high quality products without any adverse effect on the environment.
Mass media have started their campaign for protecting the earth from further deterioration.
Worldwide efforts are made to conserve natural water resources.

Thus, green marketing is a marketing philosophy that promotes production and selling of
pure (eco-friendly) products with protection of ecological balance. Green marketing involves
multiple activities. Green Marketing encourages production of pure products by pure

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technology, conservation of energy, preservation of environment, minimum use of natural

resources, and more use of natural foods instead of processed foods. Efforts of people, social
organisations, firms, and governments in this regard can be said as green marketing efforts.

Green marketing raises the voice against production, consumption, and/or disposal of such
products that anyway harm consumers, the society, and the environment. It is necessary that
businessmen and users should refrain from harmful products.

WHY GREEN MARKETING ?

It is really scary to read these pieces of information as reported in the Times recently: “Air
pollution damage to people, crops and wildlife in US. Total tens of billions of dollars each
year”. “More than 12 other studies in the US, Brazil Europe, Mexico, South Korea and
Taiwan have established links between air pollutants and low birth weight premature birth
still birth and infant death”. As resources are limited and human wants are unlimited, it is
important for the marketers to utilize the resources efficiently without waste as well as to
achieve the organization’s objective. So green marketing is inevitable. There is growing
interest among the consumers all over the world regarding protection of environment.
Worldwide evidence indicates people are concerned about the environment and are changing
their 149ehaviour. As a result of this, green marketing has emerged which speaks for growing
market for sustainable and socially responsible products and services. Thus the growing
awareness among the consumers all over the world regarding protection of the environment
in which they live, People do want to bequeath a clean earth to their offsprings Various
studies by environmentalists indicate that people are concerned about the environment and
are changing their 149ehaviour pattern so as to bee less hostile towards it. Now we see that
most of the consumers, both individual and industrial, are becoming more concerned about
environmental friendly products

Green marketing was given prominence in the late 1980s and 1990s after the proceedings of
the first workshop on Ecological marketing held in Austin, Texas (US), in 1975. Several
books on green marketing began to be published thereafter. According to the Joel makeover
(a writer, speaker and strategist on clean technology and green marketing), green marketing
faces a lot of challenges because of lack of standards and public consensus to what
constitutes “Green”. The green marketing has evolved over a period of time. According to
Peattie (2001), the evolution of green marketing has three phases. First phase was termed as
“Ecological” green marketing, and during this period all marketing activities were concerned
to help environment problems and provide remedies for environmental problems. Second
phase was “Environmental” green marketing and the focus shifted on clean technology that
involved designing of innovative new products, which take care of pollution and waste
issues. Third phase was “Sustainable” green marketing. It came into prominence in the late
1990s and early 2000.

NEED OF GREEN MARKETING : AN ANTHROPOLOGICAL VIEW

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Issues like Global warming and depletion of ozone umbrella are the main for the healthy
survival. Every person rich or poor would be interested in quality life with full of health and
vigor and so would the corporate class. Financial gain and economic profit is the main aim of
any corporate business. But harm to environment cost by sustain business across the globe is
realized now though off late. This sense is building corporate citizenship in the business
class. So greenmarketing by the business class is still in the selfish anthological perspective
of long term sustainable business and to please the consumer and obtain the license by the
governing body. Industries in Asian countries are catching the need of green marketing from
the developed countries but still there is a wide gap between their understanding and
implementation

CHALLENGES IN GREEN MARKETING

A, New Concept

Indian literate and urban consumer is getting more aware about the merits of Green products.
But it is still a new concept for the masses. The consumer needs to be educated and made
aware of the environmental threats. The new green movements need to reach the masses and
that will take a lot of time and effort. By India's ayurvedic heritage, Indian consumers do
appreciate the importance of using natural and herbal beauty products. Indian consumer is
exposed to healthy living lifestyles such as yoga and natural food consumption. In those
aspects the consumer is already aware and will be inclined to accept the green products.

B, Need for Patience

The investors and corporate need to view the environment as a major long-term investment
opportunity, the marketers need to look at the long-term benefits from this new green
movement. It will require a lot of patience and no immediate results. Since it is a new concept
and idea, it will have its own acceptance period.

Rules of green marketing

1. Know you're Customer : Make sure that the consumer is aware of and concerned
about the issues that your product attempts to address, (Whirlpool learned the hard
way that consumers wouldn't pay a premium for a CFC-free refrigerator because
consumers dint know what CFCs were.).
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. Being Genuine & Transparent: means that a) you are actually doing what you claim to
be doing in your green marketing campaign and b) the rest of your business policies

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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
4. Reassure the Buyer: Consumers must be made to believe that the product performs
the job it's supposed to do-they won't forego product quality in the name of the
environment.

5. Consider Your Pricing: If you're charging a premium for your product-and many
environmentally preferable products cost more due to economies of scale and use of
higher-quality ingredients-make sure those consumers can afford the premium and feel
it's worth it.

GREEN MARKETING – ADOPTS BY THE FARMS

Green marketing has been widely adopted by the firms worldwide and the following are the
possible reasons cited for this wide adoption

1. Opportunities - As demand changes, many firms see these changes as an opportunity

to exploit and have a competitive advantage over marketing non-environmentally
responsible alternatives. Some examples of firms who have strived to become more
environmentally responsible, in an attempt to better satisfy their consumer
• McDonald's replaced its clam shell packaging with waxed paper because of
increased consumer concern relating to polystyrene production and Ozone depletion.
• Tuna manufacturers modified their fishing techniques because of the increased
concern over driftnet fishing, and the resulting death of dolphins.
2. Government Pressure - As with all marketing related activities, governments want to
"protect" consumer and society; this protection has significant green marketing
implications. Government regulations relating to environmental marketing are
designed to protect
Consumers in several ways,
1. Reduce production of harmful goods or by-products Modify consumer and
industry's use and/or consumption of harmful goods
2. Ensure that all types of consumers have the ability to evaluate the environmental
composition of goods. Government establish regulations designed to control the
amount of hazardous wastes produced by firms.

3. Competitive Pressure - Another major force in the environmental marketing area has
been firms' desire to maintain their competitive position. In many cases firms observe
competitors promoting their environmental behaviours and attempt to emulate this behaviour.
In some instances this competitive pressure has caused an entire industry to modify and thus
reduce its detrimental environmental behavior. For example when one tuna manufacture
stopped using driftnets the others followed suit.

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4. Social Responsibility - Many firms are beginning to realize that they are members of the
wider community and therefore must behave in an environmentally responsible fashion. This
translates into firms that believe they must achieve environmental objectives as well as profit
related objectives. This results in environmental issues being integrated into the firm's
corporate culture. There are examples of firms adopting both strategies.

An example of a firm that does not promote its environmental initiative is Coca-Cola. They
have invested large sums of money in various recycling activities, as well as having modified
their packaging to minimize its environmental impact. While being concerned about the
environment, Coke has not used this concern as a marketing tool. Thus many consumers may
not realize that Coke is a very environmentally committed organization. Another firm who is
very environmentally responsible but does not promote this

fact, at least outside the organization, is Walt Disney World (WDW). WDW has an extensive
waste management program and infrastructure in place, yet these facilities are not highlighted
in their general tourist promotional activities

5. Cost of Profit Issues - Firms may also use green marketing in an attempt to address
cost or profit related issues. Disposing of environmentally harmful by products , such
as polychlorinated biphenyl (PCB) contaminated oil are becoming increasingly costly
and in some cases difficult. Therefore firms that can reduce harmful wastes may incur
substantial cost savings. When attempting to minimize waste, firms are often forced to
re-examine their production processes. In these cases they often develop more
effective production processes that not only reduce waste, but reduce the need for
some raw materials. This serves as a double cost savings, since both waste and raw
material are reduced. In other cases firms attempt to find end - of - pipe solutions,
instead of minimizing waste. In these situations firms try to find markets or uses for
they waste materials, where one firm's waste becomes another firm's input of
production. One Australian example of this is a firm who produces acidic waste water
as a by-product of production and sells it to a firm involved in neutralizing base
materials.

Few Examples who are playing a vital role in marketing

EXAMPLE 1 : Lead Free Paints from Kansai Nerolac Kansai Nerolac Paints Ltd. has
always been committed to the welfare of society and environment and as a responsible
corporate has always taken initiatives in the areas of health, education, community
development and environment preservation.Kansai Nerolac has worked on removing
hazardous heavy metals from their paints. The hazardous heavy metals like lead, mercury,
chromium, arsenic and antimony can have adverse effects on humans. Lead in paints
especially poses danger to human health where it can cause damage to Central Nervous

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System, kidney and reproductive system. Children are more prone to lead poisoning leading
to lower intelligence Nervous System, kidney and reproductive system. Children are more
prone to lead poisoning leading to lower intelligence levels and memory loss

EXAMPLE 2 :Indian Oil's Green Agenda Green Initiatives

• Indian Oil is fully geared to meet the target of reaching EURO-III compliant fuels to all
parts of the country by the year 2010; major cities will upgrade to Euro-IV compliant fuels by
that time.

• Indian Oil has invested about Rs. 7,000 crore so far in green fuel projects at its refineries;
ongoing projects account for a further Rs. 5,000 crore.

• Motor Spirit Quality Improvement Unit commissioned at Mathura Refinery; similar units
are coming up at three more refineries.

• Diesel quality improvement facilities in place at all seven Indian Oil refineries, several more
green fuel projects are under implementation or on the anvil.

• The R&D Centre of Indian Oils engaged in the formulations of eco-friendly biodegradable
lube formulation The Centre has been certified under ISO-14000:1996 for environment
management system

EXAMPLE 3:Eco-friendly Rickshaws before CWG Chief minister Shiela Dikshit launched
on Tuesday a battery operated rickshaw, “E-rick”, sponsored by a cellular services provider,
to promote eco-friendly transportation in the city ahead of the Commonwealth Games.

EXAMPLE 4: Wipro Green It.

Wipro can do for you in your quest for a sustainable tomorrow reduce costs, reduce your
carbon footprints and become more efficient - all while saving the environment.

Wipro's Green Machines (In India Only)

Wipro InfoTech was India's first company to launch environment friendly computer
peripherals. For the Indian market, Wipro has launched a new range of desktops and laptops
called Wipro Green ware. These products are RoHS (Restriction of Hazardous Substances)
compliant thus reducing e-waste in the environment

EXAMPLE 5 : Agartala to be India's first Green City Tripura Sunday announced plans to
make all public and private vehicles in Agartala run on compressed natural gas (CNG) by
2013, thus making the capital “India's first green city”.Tripura Natural Gas Co Ltd (TNGCL),
a joint venture of the Gas Authority of India Ltd (GAIL) and the Tripura and Assam
governments, has undertaken a project to supply CNG to all private and government
vehicles.CNG will also be available to those now using electricity, petrol and diesel to run
various machineries.
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EXAMPLE 6 : Going Green: Tata's new mantra The ideal global benchmark though is 1.5.
Tata Motors is setting up an eco-friendly showroom using natural building material for its
flooring and energy efficient lights. Tata Motors said the project is at a preliminary stage. The
Indian Hotels Company,which runs the Taj chain is in the process of creating eco rooms
which will have energyefficient mini bars, organic bed linen and napkins made from recycled
paper. But there won't be any carpets since chemicals are used to clean those. And when it
comes to illumination, the rooms will have CFLs or LEDs. About 5% of the total rooms at a
Taj hotel would sport a chic eco-room design. One of the most interesting innovations has
come in the form of a biogas-based power plant at Taj Green Cove in Kovalam, which uses
the waste generated at the hotel to meet its cooking requirements. Another eco-friendly
consumer product that is in the works is Indica EV, an electric car that will run on polymer
lithium ion batteries. Tata Motors plans to introduce the Indica EV in select European
markets this year.

PRESENT TRENDS IN GREEN MARKETING IN INDIA

Organizations are Perceive Environmental marketing as an Opportunity to achieve its
objectives. Firms have realized that consumers prefer products that do not harm the natural
environment as also the human health. Firms marketing such green products are preferred
over the others not doing so and thus develop a competitive advantage, simultaneously
meeting their business objectives

.Organizations believes they have a moral obligation to be more socially responsible. This is
in keeping with the philosophy of CSR which has been successfully adopted by many
business houses to improve their corporate image.

Governmental Bodies are forcing Firms to Become More Responsible. In most cases the
government forces the firm to adopt policy which protects the interests of the consumers. It
does so in following ways:

• Reduce production of harmful goods or by products

• Modify consumer and industry's use and /or consumption of harmful goods; or

• Ensure that all types of consumers have the ability to evaluate the environmental
composition of goods

THE FUTURE OF GREEN MARKETING

There are many lessons to be learned to be learned to avoid green marketing myopia, the
short version of all this is that effective green marketing requires applying good marketing
principles to make green products desirable for consumers. The question that remains,
however, is, what is green marketing's future? Business scholars have viewed it as a “fringe”
topic, given that environmentalism's acceptance of limits and conservation does not mesh

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well with marketing's traditional axioms of “give customer what they want” and “sell as
much as you can”. Evidence indicates that successful green products have avoided green
marketing myopia by Following three important principles:

CONSUMER VALUE POSITIONING

• Design environmental products to perform as well as (or better than) alternatives.

• Promote and deliver the consumer desired value of environmental products and target
relevant consumer market segments.

• Broaden mainstream appeal by bundling consumer desired value into environmental

products.

CONCLUSION
Now this is the right time to select “Green Marketing” globally. It will come with drastic
change in the world of business if all nations will make strict roles because green marketing
is essential to save world from pollution. From the business point of view because a clever
marketer is one who not only convinces the consumer, but also involves the consumer in
marketing his product. Green marketing should not be considered as just one more approach
to marketing, but has to be pursued with much greater vigor, as it has an environmental and
social dimension to it. With the threat of global warming looming large, it is extremely
important that green marketing becomes the norm rather than an exception or just a fad.
Recycling of paper, metals, plastics, etc., in a safe and environmentally harmless manner
should become much more systematized and universal. It has to become the general norm to
use energy-efficient lamps and other electrical goods. Marketers also have the responsibility
to make the consumers understand the need for and benefits of green products as compared to
non-green ones. In green marketing, consumers are willing to pay more to maintain a cleaner
and greener environment. Finally, consumers, industrial buyers and suppliers need to
pressurize effects on minimize the negative effects on the environment-friendly. Green
marketing assumes even more importance and relevance in developing

REFERENCES
J.A Ottman,.et al, "Avoiding Green Marketing Myopia",
Environment, Vol-48, June-2006
2. www.greenmarketing.net/stratergic.html
3. www.epa.qld.gov.au/sustainable_ industries ES
4. www.google.com
5. https://www.researchgate.net/profile/Deepti_Surya/publication

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EVS-176
Solid Waste Management and Its Treatment
*Rajpal Singh,* Rishi Kumar, *Gagan Gupta, *Mandeep Singh, **Gagandeep Singh
*
Department of Applied Physics, Maharaja Ranjit Singh State Technical University,
Bathinda-151001, Punjab.
**
Department of Applied Physics, Maharaja Ranjit Singh State Technical University,
Bathinda-151001, Punjab.

Abstract

The government and environmental associations have developed numerous methods of

dealing with the problem. Waste management is that solution, a rather complex issue that
encompasses different industries. Waste management is collection, transportation, and
disposal of garbage, sewage and other waste products. Waste management is the process of
treating solid wastes and offers variety of solutions for recycling items that don’t belong to
trash. It is about how garbage can be used as a valuable resource. Waste management is
something that each and every household and business owner in the world needs. Waste
management disposes of the products and substances that you have use in a safe and efficient
manner.

Key Words: Solid Waste Management, treatment, disposal, waste collection.

Introduction

Solid waste is the unwanted or useless solid materials generated from combined residential,
industrial and commercial activities in a given area. It may be categorised according to its
origin (domestic, industrial, commercial, construction or institutional); according to its
contents (organic material, glass, metal, plastic paper etc); or according to hazard potential
(toxic, non-toxin, flammable, radioactive, infectious etc).

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Management of solid waste reduces or eliminates adverse impacts on the environment and
human health and supports economic development and improved quality of life. A number of
processes are involved in effectively managing waste for a municipality. These include
monitoring, collection, transport, processing, recycling and disposal.

Reduce, Reuse, Recycle

Methods of waste reduction, waste reuse and recycling are the preferred options when
managing waste. There are many environmental benefits that can be derived from the use of
these methods. They reduce or prevent green house gas emissions, reduce the release of
pollutants, conserve resources, save energy and reduce the demand for waste treatment
technology and landfill space. Therefore it is advisable that these methods be adopted and
incorporated as part of the waste management plan.

Waste reduction and reuse

Waste reduction and reuse of products are both methods of waste prevention. They eliminate
the production of waste at the source of usual generation and reduce the demands for large
scale treatment and disposal facilities. Methods of waste reduction include manufacturing
products with less packaging, encouraging customers to bring their own reusable bags for
packaging, encouraging the public to choose reusable products such as cloth napkins and
reusable plastic and glass containers, backyard composting and sharing and donating any
unwanted items rather than discarding them.

All of the methods of waste prevention mentioned require public participation. In order to get
the public onboard, training and educational programmes need to be undertaken to educate
the public about their role in the process. Also the government may need to regulate the types
and amount of packaging used by manufacturers and make the reuse of shopping bags
mandatory.

Recycling
Recycling refers to the removal of items from the waste stream to be used as raw materials in
the manufacture of new products. Thus from this definition recycling occurs in three phases:

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first the waste is sorted and recyclables collected, the recyclables are used to create raw
materials. These raw materials are then used in the production of new products.
The sorting of recyclables may be done at the source (i.e. within the household or office) for
selective collection by the municipality or to be dropped off by the waste producer at a
recycling centres. The pre-sorting at the source requires public participation which may not
be forthcoming if there are no benefits to be derived. Also a system of selective collection by
the government can be costly. It would require more frequent circulation of trucks within a
neighbourhood or the importation of more vehicles to facilitate the collection.
Another option is to mix the recyclables with the general waste stream for collection and then
sorting and recovery of the recyclable materials can be performed by the municipality at a
suitable site. The sorting by the municipality has the advantage of eliminating the dependence
on the public and ensuring that the recycling does occur. The disadvantage however, is that
the value of the recyclable materials is reduced since being mixed in and compacted with
other garbage can have adverse effects on the quality of the recyclable material.

Figure 1. Colour coded recycling bins for waste separation at the source of production

Waste Collection
Waste from our homes is generally collected by our local authorities through regular waste
collection, or by special collections for recycling. Within hot climates such as that of the
Caribbean the waste should be collected at least twice a week to control fly breeding, and the

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harbouring of other pests in the community. Other factors to consider when deciding on
frequency of collection are the odours caused by decomposition and the accumulated
quantities. Descriptions of the main types of collection systems are given in the table below.

System Description Advantages Disadvantages

SHARED: Residents can bring out waste at any time
Dumping at Residents and other Low capital Loading the waste into trucks is
designated generators are costs slow and unhygienic. Waste is
location required to dump scattered around the collection
their waste at a point. Adjacent residents and
specified location or shopkeepers protest about the
in a masonry smell and appearance.
enclosure.
Shared Residents and other Low operating If containers are not maintained
container generators put their costs they quickly corrode or are
waste inside a damaged.
container which is Adjacent residents complain about
emptied or removed. the smell and appearance.
INDIVIDUAL: The generators need a suitable container and must store the waste on
their property until it is collected.
Block Collector sounds Economical. If all family members are out when
collection horn Less waste collector comes, waste must be left
or rings bell and on streets. No outside for collection. It may be
waits permanent scattered by wind, animals and
at specified locations container or waste pickers.
for residents to bring storage to
waste to the cause
collection complaints.
vehicle.
Curbside Waste is left outside Convenient. Waste that is left out may be
collection property in a No scattered
container permanent by wind, animals, children or
and picked up by public waste pickers.
passing vehicle, or storage If collection service is delayed,
swept up and waste
collected may not be collected or some time,
by sweeper. causing considerable nuisance.
Door to door Waste collector Convenient for Residents must be available to
collection knocks on each door resident. hand waste over. Not suitable for
or rings Little waste apartment
doorbell and waits on street. buildings because of the amount of
for walking required.
waste to be brought
out by resident.
Yard Collection laborer Very convenient The most expensive system,

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collection enters property to for residents. No because of the walking involved.

remove waste. waste in street. Cultural beliefs, security
considerations or architectural
styles may prevent laborers from
entering properties.

Table 1: Descriptions of the main collection systems.

Treatment & Disposal

Waste treatment techniques seek to transform the waste into a form that is more manageable,
reduce the volume or reduce the toxicity of the waste thus making the waste easier to dispose
of. Treatment methods are selected based on the composition, quantity, and form of the waste
material. Some waste treatment methods being used today include subjecting the waste to
extremely high temperatures, dumping on land or land filling and use of biological processes
to treat the waste. It should be noted that treatment and disposal options are chosen as a last
resort to the previously mentioned management strategies reducing, reusing and recycling of
waste (figure 1).

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Figure 2 Solid Waste Management Hierarchy.

Thermal treatment
This refers to processes that involve the use of heat to treat waste. Listed below are
descriptions of some commonly utilized thermal treatment processes.

Incineration
Incineration is the most common thermal treatment process. This is the combustion of waste
in the presence of oxygen. After incineration, the wastes are converted to carbon dioxide,
water vapour and ash. This method may be used as a means of recovering energy to be used
in heating or the supply of electricity. In addition to supplying energy incineration
technologies have the advantage of reducing the volume of the waste, rendering it harmless,
reducing transportation costs and reducing the production of the green house gas methane.

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Pyrolysis and Gasification

Pyrolysis and gasification are similar processes they both decompose organic waste by
exposing it to high temperatures and low amounts of oxygen. Gasification uses a low oxygen
environment while pyrolysis allows no oxygen. These techniques use heat and an oxygen
starved environment to convert biomass into other forms. A mixture of combustible and non-
combustible gases as well as pyroligenous liquid is produced by these processes. All of these
products have a high heat value and can be utilised. Gasification is advantageous since it
allows for the incineration of waste with energy recovery and without the air pollution that is
characteristic of other incineration methods.

Open burning
Open burning is the burning of unwanted materials in a manner that causes smoke and other
emissions to be released directly into the air without passing through a chimney or stack. This
includes the burning of outdoor piles, burning in a burn barrel and the use of incinerators
which have no pollution control devices and as such release the gaseous by products directly
into the atmosphere (Department of environmental quality 2006). Open burning has been
practiced by a number of urban centres because it reduces the volume of refuse received at
the dump and therefore extends the life of their dumpsite. Garbage may be burnt because of
the ease and convenience of the method or because of the cheapness of the method. In
countries where house holders are required to pay for garbage disposal, burning of waste in
the backyard allows the householder to avoid paying the costs associated with collecting,
hauling and dumping the waste.

Open burning has many negative effects on both human health and the environment. This
uncontrolled burning of garbage releases many pollutants into the atmosphere. These include
dioxins, particulate matter, polycyclic aromatic compounds, volatile organic compounds,
carbon monoxide, hexachloro benzene and ash. All of these chemicals pose serious risks to
human health. The Dioxins are capable of producing a multitude of health problems; they can
have adverse effects on reproduction, development, disrupt the hormonal systems or even
cause cancer. The polycyclic aromatic compounds and the hexachloro benzene are considered

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to be carcinogenic. The particulate matter can be harmful to persons with respiratory

problems such as asthma or bronchitis and carbon monoxide can cause neurological
symptoms.
The harmful effects of open burning are also felt by the environment. This process releases
acidic gases such as the halo-hydrides; it also may release the oxides of nitrogen and carbon.
Nitrogen oxides contribute to acid rain, ozone depletion, smog and global warming. In
addition to being a green house gas carbon monoxide reacts with sunlight to produce ozone
which can be harmful. The particulate matter creates smoke and haze which contribute to air
pollution.

Dumps and Landfills

Sanitary landfills
Sanitary Landfills are designed to greatly reduce or eliminate the risks that waste disposal
may pose to the public health and environmental quality. They are usually placed in areas
where land features act as natural buffers between the landfill and the environment. For
example the area may be comprised of clay soil which is fairly impermeable due to its tightly
packed particles, or the area may be characterised by a low water table and an absence of
surface water bodies thus preventing the threat of water contamination.
In addition to the strategic placement of the landfill other protective measures are
incorporated into its design. The bottom and sides of landfills are lined with layers of clay or
plastic to keep the liquid waste, known as leach ate, from escaping into the soil. The leach
ate is collected and pumped to the surface for treatment. Boreholes or monitoring wells are
dug in the vicinity of the landfill to monitor groundwater quality.
A landfill is divided into a series of individual cells and only a few cells of the site are filled
with trash at any one time. This minimizes exposure to wind and rain. The daily waste is
spread and compacted to reduce the volume, a cover is then applied to reduce odours and
keep out pests. When the landfill has reached its capacity it is capped with an impermeable
seal which is typically composed of clay soil.
Some sanitary landfills are used to recover energy. The natural anaerobic decomposition of
the waste in the landfill produces landfill gases which include Carbon Dioxide, methane and
traces of other gases. Methane can be used as an energy source to produce heat or electricity.

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Thus some landfills are fitted with landfill gas collection (LFG) systems to capitalise on the
methane being produced. The process of generating gas is very slow, for the energy recovery
system to be successful there needs to be large volumes of wastes.

These landfills present the least environmental and health risk and the records kept can be a
good source of information for future use in waste management, however, the cost of
establishing these sanitary landfills are high when compared to the other land disposal
methods.

Figure 3 Main features of a modern landfill

Controlled dumps
Controlled dumps are disposal sites which comply with most of the requirements for sanitary
landfill but usually have one deficiency. They may have a planned capacity but no cell
planning, there may be partial leach ate management, partial or no gas management, regular
cover, compaction in some cases, basic record keeping and they are fenced or enclosed.
These dumps have a reduced risk of environmental contamination, the initial costs are low

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and the operational costs are moderate. While there is controlled access and use, they are still
accessible by scavengers and so there is some recovery of materials through this practice.

Bioreactor Landfills
Recent technological advances have lead to the introduction of the Bioreactor Landfill. The
Bioreactor landfills use enhanced microbiological processes to accelerate the decomposition
of waste. The main controlling factor is the constant addition of liquid to maintain optimum
moisture for microbial digestion. This liquid is usually added by re-circulating the landfill
leach ate. In cases where leach ate in not enough, water or other liquid waste such as sewage
sludge can be used. The landfill may use either anaerobic or aerobic microbial digestion or it
may be designed to combine the two. These enhanced microbial processes have the
advantage of rapidly reducing the volume of the waste creating more space for additional
waste, they also maximise the production and capture of methane for energy recovery
systems and they reduce the costs associated with leach ate management. For Bioreactor
landfills to be successful the waste should be comprised predominantly of organic matter and
should be produced in large volumes.

Biological waste treatment

Composting
Composting is the controlled aerobic decomposition of organic matter by the action of micro
organisms and small invertebrates. There are a number of composting techniques being used
today. These include: in vessel composting, windrow composting, Vermi composts and static
pile composting. The process is controlled by making the environmental conditions optimum
for the waste decomposers to thrive. The rate of compost formation is controlled by the
composition and constituents of the materials i.e. their Carbon/Nitrogen (C/N) ratio, the
temperature, the moisture content and the amount of air.The C/N ratio, the temperature, the
moisture content and the amount of air. The C/N ratio is very important for the process to be
efficient. The micro organisms require carbon as an energy source and nitrogen for the
synthesis of some proteins. If the correct C/N ration is not achieved, then application of the
compost with either a high or low C/N ratio can have adverse effects on both the soil and the

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plants. A high C/N ratio can be corrected by dehydrated mud and a low ratio corrected by
adding cellulose.
Moisture content greatly influences the composting process. The microbes need the moisture
to perform their metabolic functions. If the waste becomes too dry the composting is not
favoured. If however there is too much moisture then it is possible that it may displace the air
in the compost heap depriving the organisms of oxygen and drowning them.
A high temperature is desirable for the elimination of pathogenic organisms. However, if
temperatures are too high, above 75oC then the organisms necessary to complete the
composting process are destroyed. Optimum temperatures for the process are in the range
of 50-600C with the ideal being 600C. Aeration is a very important and the quantity of air
needs to be properly controlled whencomposting. If there is insufficient oxygen the aerobes
will begin to die and will bereplaced by anaerobes. The anaerobes are undesirable since they
will slow the process,produce odours and also produce the highly flammable methane gas.
Air can beincorporated by churning the compost.

Anaerobic Digestion
Anaerobic digestion like composting uses biological processes to decompose organic waste.
However, where composting can use a variety of microbes and must have air, anaerobic
digestion uses bacteria and an oxygen free environment to decompose the waste. Aerobic
respiration, typical of composting, results in the formation of Carbon dioxide and water.
While the anaerobic respiration results in the formation of Carbon Dioxide and methane. In
addition to generating the humus which is used as a soil enhancer, Anaerobic Digestion is
also used as a method of producing biogas which can be used to generate electricity.
Optimal conditions for the process require nutrients such as nitrogen, phosphorous and
potassium, it requires that the pH be maintained around 7 and the alkalinity be appropriate to
buffer pH changes, temperature should also be controlled.

Integrated Solid Waste Management

Integrated Solid Waste Management (ISWM) takes an overall approach to creating
sustainable systems that are economically affordable, socially acceptable and
environmentally effective. An integrated solid waste management system involves the use of

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a range of different treatment methods, and key to the functioning of such a system is the
collection and sorting of the waste. It is important to note that no one single treatment method
can manage all the waste materials in an environmentally effective way. Thus all of the
available treatment and disposal options must be evaluated equally and the best combination
of the available options suited to the particular community chosen. Effective management
schemes therefore need to operate in ways which best meet current social, economic, and
environmental conditions of the municipality.

Figure 4 Elements of Integrated Solid Waste Management

Useful Websites
United Nations Environment Programme International Source Book on
Environmentally Sound Technologies (ESTs) for Municipal Solid Waste
Management (MSWM)<http://www.unep.or.jp/ietc/ESTdir/Pub/MSW/index.asp

Sewerage and Solid Waste Project Unit. 2000. The solid waste management programme.
Sewerage and Solid Waste Project Unit, Barbados.
<http://www.solid.gov.bb/Resources/Brochures/Programme/program02.asp >
http://www.wasteonline.org.uk/resources/InformationSheets/WasteDisposal.htm
http://www.eia.doe.gov/kids/energyfacts/saving/recycling/solidwaste/landfiller.html
http://web.mit.edu/urbanupgrading/upgrading/issues-tools/issues/waste

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collection.html#Anchor-Collection-45656
http://www.sustainability-ed.org/pages/example2-2.htm
http://www.massbalance.org/downloads/projectfiles/1826-00237.pdf
http://msw.cecs.ucf.edu/Lesson8-Incineration.html
http://www.csiro.au/org/ps16w.html
http://viso.ei.jrc.it/iwmlca/

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EVS-177
Biodegradation of a Polycyclic Aromatic Hydrocarbon by a Novel
Isolate

*Rajesh Singla
**Associate Professor - Microbiology and Head, Agriculture Department,
S.S.D. College of Professional Studies, Bhokhra - 151201, Bathinda, Punjab, INDIA.
[email protected], 9356460660

Abstract:
From the oil contaminated soil of 4 different filling stations of Bathinda, Punjab, India,
bacterial strains were isolated and screened for their ability to degrade anthracene. For
isolation of the anthracene degrading bacteria, enriched media was used with 0.5% peptone
and 0.1% w/v anthracene in basal salt mineral medium and the concentration of peptone was
decreased to 0.25 g, 0.1 g and to 0.0 g during successive enrichment. After one month of
enrichment, only 5 strains (out of total 70 strains screened) were found to be potent
anthracene degrader. These 5 strains were further subcultured for 10 days and on the basis of
percentage of anthracene degradation strain E was found to degrade 74.8% anthracene
supplemented in BSM medium at 0.1% as sole source of carbon and energy and identified as
Pseudomonas sp. As evident by antibiotic sensitivity test, Pseudomonas sp. showed resistance
against Cefadroxil and Ampicillin among tested 7 antibiotics.

Key words: anthracene, Pseudomomas sp., strain, antibiotics

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1. Introduction
Polycyclic aromatic hydrocarbons (PAHs) represent a class of nonionic, lipophilic in nature, poorly water
soluble and toxic organic compounds which originate from natural and anthropogenic pyrolysis of organic
matter such as forest fires, automobile exhaust, coal and oil refining processes, the generation of wastes
from coal gasification plants (Conte et al., 2001;Ni Chadhain et al., 2006 and Hafez et al., 2008). These are
a group of compounds containing carbon and hydrogen, composed of two or more fused aromatic rings in
linear, angular and cluster arrangements. PAHs have been identified as hazardous chemicals by different
State and Central Pollution Control Boards because of their toxic, carcinogenic and tetragenic effects on
living body (Ruma et al., 2007). Anthracene, together with other PAHs, is a persistent and toxic soil
contaminant (Hyotylainen and Oikari,1999; Lotufo,1997). Pollution by PAHs is usually found on the sites
of gas factories and wood preservation plants. Environmental anthracene contamination originates from a
number of anthropogenic sources/practices such as manufacturing of dyes, production of synthetic fibers,
plastics and pesticides, petroleum spills as a result of pipeline rupture and tanker failure. Its natural sources
are coal and tar, and can be released by incomplete combustion of fuels (such as coal, oil, gas). Therefore, it
is a constituent of exhaust from automobile and charcoal grills.
Microbial degradation plays major role in the removal of PAHs from contaminated sites. The ability to
degrade PAHs is shown by various groups of organisms including bacteria, fungi and algae (Van Hamme et
al., 2000). The bacteria can be isolated from soil polluted by effluent of paper, pesticides, petrochemical,
polymer, rubber and printing, shoe, drug, industry, as effluent containing carbon source plays significant
role in bioagumentation (Hassan et al., 2009 and Neelofur et al., 2014). These microorganisms also have
role in biodegradation of lignin, resin, organophosphrous pesticides, phenols, azo dyes, and phorate (Kadam
and Gangawane, 2005).
The biodegradation rate and fate varies in aerobic and anaerobic condition. In aerobic biodegradation the
genera like Pseudomonas, Bacillus, Alkaligens, Acenetobacter, Streptococcus, Aeromonas, Bacillus and
Mycobacterium might have potential role in biodegradation of anthracene. These contaminated sites may act
as source for isolation of potential anthracene degraders. Degradation of anthracene, that is its conversion to
both carbon dioxide and water (mineralization) or other organic substances (degradation products) which is
not toxic is one of the inexpensive way of removing large concentrations of anthracene from soil and water.
Bioremediation is an economically and environmentally attractive solution for cleaning those sites and
microbial degradation plays a primary role in PAH reduction in contaminated sites (Kastner and Maho,1996
and Zhang et al., 2011). Due to its cost effectiveness and the benefit of pollutant mineralization to carbon
dioxide and water, bioremediation is an attractive process (Trindade et al., 2005). Transfer of genes
responsible for biodegradation of hydrocarbons plays an important role in bioremediation of pollutants
(Wilson and Jones, 1993).
By observing these problems, an approach was undertaken to isolate microbes, which can degrade
anthracene and it’s by products which may be harmful to human and animal health. With the aim of
remediation and removal of anthracene from the environment, the present study is focused on the isolation,
characterization and optimization of growth conditions of a novel bacterial isolate capable of efficiently
degrading the anthracene.

2. Review

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Neeraja et al. (2013) in their research work isolated and identified anthracene degrading bacterial species
from soil contaminated with wastes of petroleum industry. The efficiency of biodegradation capacity of
isolated microorganism was checked by U.V. spectroscopy. The contaminated soil samples were grown on
MM9 medium and the cultures were transferred onto the GSP agar medium for the presence of
Pseudomonas species (indicated by the presence of yellow to red colouration). Further, the isolates were
identified on the basis of morphological, trophic and biochemical traits according to Bergey’s Manual of
Systemetic Bacteriology (1994). Chromosomal DNA was isolated and compared with that of Pseudomonas
aeruginosa ATCC 27853. Purity of DNA was estimated from A280, A260, A230and based on the percentage of
cytosine to guanine content, the isolated organism was considered as Pseudomonas stutzery. Around 76% of
anthracene was degraded by the isolated Pseudomonas organism.
Meshram and Wate (2014) isolated Bacillus cereus strain from contaminated soil of IOCL depot Khapri,
Nagpur, MS, India. The isolated Bacillus cereus strain was able to decompose upto 1000 ppm of anthracene
tried so far. Effects of environmental factors like pH, temperature and substrate concentration over
mineralization was also studied. pH of 7.5, temperature of 350C and substrate concentration of 500 ppm
were optimum environmental conditions studied in laboratory. 2,3 dihydroxynapthalene, catechol, phthalate
were reported as intermediates from HPLC analysis and possible mineralization pathway for anthracene
degradation through these intermediates was suggested.
Neelofur et al. (2014) in their study isolated bacteria capable of utilizing anthracene as the sole source of
carbon and energy. Nine organisms were isolated out of the 40 soil samples collected from industrial area of
Bangalore. Based on the screening test the organism was selected and identified by 16s RNA sequencing.
The organism was subjected for optimization study at different concentrations of anthracene, pH,
temperatures, effect of carbon source and nitrogen source. After optimization, more degradation was
observed at 10mg concentration, at pH 5 and temperature of 35oC but the effect of nitrogen source (sodium
nitrate) showed 60 times more degradation and along with that effect of carbon source increased nearly 15
times. After U.V. mutation, the degradation capability increased nearly 20 times. The cytochrome oxidase
activity which is involved in the degradation of anthracene was determined and the degradation was
analysed by high performance liquid chromatography (HPLC).
Karale et al. (2015) in their research work, isolated thirty six anthracene degrading bacteria from the soil
polluted by drug industry effluent using Bushnell Haas medium supplemented with anthracene as a sole
source of carbon and energy. The anthracene degradation ability of these isolates was qualitatively
confirmed by 2,6-dichlorophenol indophenol (2,6-DCPIP). Three bacterial isolates were selected which had
highest anthracene degradation potential and were identified as Aeromonas hydrophila, Bacillus polymyxa
and Streptococcus mutans on the basis of morphological and biochemical characteristics. The growth and
pH change in the medium were assessed periodically at 1mg/ml concentration of anthracene for individual
isolates as well as with consortium. The pH decreased in all flasks; however highest decrease was observed
in the medium inoculated with bacterial consortium. Similarly 94% degradation of anthracene was observed
with consortium whereas B. polymyxa, A. hydrophila, and S. mutans degraded 80%, 52% and 44% of
anthracene respectively. This study indicated that consortium mediated biodegradation of anthracene is
more effective in bioremediation of anthracene.
Esedafe et al. (2015) in theirwork aimed at bacterial degradation of polycyclic aromatic hydrocarbons in
untreated refinery effluent. Contaminated soil samples were collected from Warri refinery jetty while water
sample was collected from Ekpan River and untreated effluent was collected from Warri refinery and
Petrochemical Company. The total heterotrophic bacterial count ranged from 0.6×106 to 2.7×106 cfu/ml for

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soil samples and

3.2×106 cfu/ml for water sample. The hydrocarbon utilizing bacteria count ranged from
1.4×103 to 2.0×103 cfu/ml for soil samples and 1.0×103cfu/ml for water sample. Among the 41 bacterial
isolates capable of utilizing crude oil vapour, 26 gave a positive emulsification activity on crude oil while
only 3 were capable of degrading anthracene and phenanthrene. The three (3) PAH-degraders were
characterized and identified as Pseudomonas sp. (SB), Achromobacter xylosoxidans (SB1) and
Pseudomonas sp. (SB3). The percentage degradation of the polycyclic aromatic hydrocarbons in the refinery
effluent after 360 hours was highest in the mixed bacterial culture with 97.90% and this was followed
closely by Pseudomonas sp. (SB) with 96% and Achromobacter xylosoxidans (SB1) having the lowest with
93.40%.

3. Materials and Methods

3.1 Collection of soil samples

For the isolation of anthracene degrading bacteria, soil samples were collected from 4 different filling
stations of Bathinda, Punjab, India. Samples were stored in sterilized polyethylene bags at 4C for further
use.

3.2 Enrichment and isolation of anthracene degrading microorganism

One gram of each soil sample was suspended in 100 ml Basal Salt Mineral (BSM) medium (g/l: K 2HPO4 -
0.38; MgSO4.7H2O - 0.2; NH4Cl - 1.0; FeCl3 - 0.05; distilled water -1000 ml and pH - 7.0) broth containing
1.0 g peptone and 0.1% w/v anthracene. Flasks were incubated at 30C on a incubator cum shaker at 150
rpm. After 1 week of incubation, 5 ml of inoculum was transferred from each flask to the fresh 100 ml BSM
broth containing 0.5 g peptone and 0.1% w/v anthracene. Further, subculturing was done with 0.25 g, 0.1 g
and 0.0 g peptone with constant concentration of anthracene. The anthracene degrading microorganisms
from the flask containing 0.1% w/v anthracene and no peptone were isolated by spread and streak plate
method and analyzed for their anthracene degradation potential.

3.3 Calculation of λmax and Standard curve of anthracene

For the determination of λmax of anthracene, a 10 ppm solution of anthracene in ethyl acetate was prepared
and scanned on UV-VIS spectrophotometer from 190-600 nm. The λmax was used for determining the
concentration of anthracene in ethyl acetate extracts. For preparing the standard curve of anthracene, a stock
solution of 10 ppm in ethyl acetate was prepared and aliquots in the range of 0.2 to 1 ppm were read
separately at λmax of anthracene. Anthracene was added to the aqueous media by dissolution in ethyl acetate
as a carrier solvent (Moody et al, 2001 and Nadalig et al, 2002).

3.4 Screening of anthracene degrading microorganisms

For screening of anthracene degrading microorganism, 30 ml BSM broth containing 0.1% w/v anthracene
was taken in different flasks as sole carbon source and inoculated with 5% inoculums (A600, 0.70) of
different enriched soil isolates. All the flasks were incubated at 30C for 10 days on incubator cum shaker at
150 rpm. During incubation, the residual concentration of anthracene was monitored using
spectrophotometer by liquid-liquid extraction method for 10 days (Manohar et al., 1999).

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Further, the anthracene degrading capability of most efficient anthracene degrading organism was
monitored in 30 ml BSM broth containing 1.5% w/v anthracene/ethyl acetate and 5% inoculum (A 600, 0.70).
It was monitored by sampling 2 ml from each reaction set at an interval of 24 h for 240 h. Identification of
isolate with best degrading ability was done on the basis of microscopic, morphological and biochemical
characteristics.

3.5 Antibiotic Sensitivity of best isolate

The antibiotic sensitivity of most efficient anthracene degrading microorganism was checked against seven
different antibiotics by agar cup method. The culture was spread plate on BSM agar medium and incubated
for 30 min. 70 µl of each antibiotic was poured in the wells of 4mm diameter made with the help of a cork
borer.

4. Results

4.1 Screening for most efficient anthracene degrading microorganism

The λmax of anthracene in ethyl acetate was found to be 254 nm (Figure 1). It was used to determine the
concentration of anthracene in ethyl acetate extracts. Different soil samples from 4 filling station sites were
analyzed for their anthracene degradation capability. After enrichment, 5 strains were found to be efficient
anthracene degrader out of total 70 bacterial strains. Further, the anthracene degrading capability was
monitored in BSM medium supplemented with anthracene as sole source of carbon for 10 days. Strain E
was found to be the most efficient anthracene degrader with maximum degradation rate of 74.8% on the
basis of percentage of anthracene degradation ability whereas strain B showed the least anthracene
degradation ability of 15.5% (Figure 2). On the basis of cultural, microscopic, morphological and
biochemical characteristics (Table 1) strain E was tentatively identified as Pseudomonas sp. using Bergey’s
manual of systematic bacteriology.

Figure 1. UV-Spectrum of anthracene with single peak at 254 nm showing the maximum absorbance

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Figure 2. Degradation of Anthracene by 5 different soil isolates (10 days of incubation period)
Table 1.Morphological and Biochemical characterization of Pseudomonas sp.

S.No. TESTS RESULTS

Morphological Characteristics
Convex, Round, Creamish, Opaque,
1 Colony Character
Greenish on white media
2 Simple Staining +
3 Gram Staining - , bacilli
4 Endospore +,Green spores
5 Negative Staining +
6 Motility Motile
Biochemical Characteristics
7 Casein Hydrolysis +
8 Urease -
9 H2S Production -
10 Carbohydrate catabolism -
11 Indole Test -
12 Methyl-Red Test -
13 Voges-Proskauer Test -
14 Citrate Utilization +
15 Catalase Test +
16 Oxidase reaction +
17 Nitrate reduction +
18 Gelatin Liquefaction +

4.2 Anthracene degradation

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The results of growth of bacterium on anthracene and its consumption at different periods of incubation is
given in Figure 3. Results indicate that there is an increase in cell growth of bacterium with an increase in
incubation period. The maximum growth of bacterium was observed at 9th day of incubation (A600, 1.02). At
10th day of incubation, the bacterium showed 74.8% utilization of anthracene that is it was able to degrade
anthracene to a good extent.

Figure 3.Growth of bacterium (A600) and percentage of anthracene degradation by Pseudomonas sp.
4.3 Antibiotic sensitivity
Pseudomonas sp. was tested against 7 different antibiotics for its sensitivity and resistance. Zone of
inhibition (in mm) was observed against five antibiotics viz. oxytetracycline, azithromycin, erythromycin,
cefixine and amoxyciline antibiotics while ampicillin and cefadroxil showed no zone of inhibition (Figure 4,
Table 2).

Figure 4. Sensitivity and resistance of Pseudomonas sp. against different antibiotics (OT- Oxytetracycline,
CP- Cefadroxil, AZ- Azithromycin, ET- Erythromycin, CX- Cefixine, AP- Ampicillin, AM- Amoxicilline).

Table 2.Zone of inhibition of 7 different antibiotics against Pseudomonas sp.

S.N. Antibiotics Abbreviation Zoneof Inhibition (mm)
1 Oxytetracycline OT 21
2 Cefixine CX 17

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3 Azithromycin AZ 16
4 Erythomycin ET 8
5 Amoxicilline AM 6
6 Ampicillin AP 0
7 Cefadroxil CP 0

5. Discussion
Strain E of Pseudomonas sp. was isolated from filling station sites of Bathinda, Punjab, India and cultured in
BSM broth supplemented with 0.1% w/v anthracene as substrate. In contrast to other strains isolated in this
study, Pseudomonas sp. strain E degraded 74.8% of anthracene in 10 days of incubation and maximum
bacterial growth was measured on 9th day. Manohar et al., (1999) had reported the complete anthracene
degradation (2.8 mM) after 6 days of incubation. Similar studies have been reported for anthracene
degradation and mineralization by Pseudomonas, Sphingomonas, Nocardia, Beijerinckia, Rhodococcus and
Mycobacterium (Dean-Ross et al., 2000). Our results are in accordance with the results of Matthew et al.
(2000), who in their study isolated Pseudomonas aeruginosa, Alcaligenes eutrophus, Bacillus subtilis and
Micrococcus luteus from soils polluted with crude oil using 0.1% w/v anthracene as the sole source of
carbon and energy and resulted in a residual oil concentration of 22.2%, 33.3%, 39.3%, 44.0% and 91.7%
respectively. Rodrigo et al. (2005) had also reported anthracene degradation by Pseudomonas sp. isolated
from a 14-year-old petrochemical sludge land farming site. It degraded 71% of the anthracene added to the
medium (250 mg L-1). Eder et al. (2008) showed that after 48 days Pseudomonas citronellolis isolate 222A
degraded 72% of anthracene. Another study has reported the complete degradation of added anthracene to
autoclaved soil by Burkholderia sp. in 20 days (Somtrakoon et al., 2008).
We have tested several antibiotics for their resistance against Pseudomonas sp. strain E and observed that
strain E was resistant against cefadroxil and ampicillin antibiotics. This suggested that strain E may possess
the genes for resistance against these two antibiotics.

6. Conclusion

This study has also shown that not all hydrocarbon utilizers obtained from an environment are capable of
utilizing polycyclic aromatic hydrocarbons even though they may have been isolated from a hydrocarbon
polluted environment. This may be due to the fact that most bacteria isolates select only hydrocarbons they
can easily metabolize which in most cases constitute the non-recalcitrant fraction and as such are unable to
thrive in a medium comprising of recalcitrant hydrocarbons such as polycyclic aromatic hydrocarbons as
sole carbon and energy source. Polycyclic aromatic hydrocarbons have been reported to be toxic to

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microorganisms. Mobilization of these compounds into cells of organisms would only give rise to cytotoxic
effects and would cause harm to the organism instead of fostering degradation. This study has revealed that
not all hydrocarbon utilizers are capable of metabolizing polycyclic aromatic hydrocarbons and this may be
due in part to the absence of the necessary physiology for the metabolism of this group of hydrocarbons.
The ability of the bacterial isolate Pseudomonas sp. (Strain E) employed in this study to degrade the
polycyclic aromatic hydrocarbon indicates that microorganisms capable of degrading certain hydrocarbon
pollutants in the pure form are also capable of degrading such pollutants when found in a mixture with other
pollutants. As such, Pseudomonas sp. is an efficient anthracene degrading strain and could be use to develop
an environmental friendly technology to overcome the problem of oil spills.

7. References

Conte, P., Zena, A. and Pilidis, G. (2001). Increased retention of polycyclic aromatic hydrocarbons in soils
induced by soil treatment with humic substances. J. Environ. Pollut.112: 27-31.
Dean-Ross D., Moody, J.D., Freeman, J.P., Doerge, D.R. and Cerniglia, C.E. (2001).Metabolism of
anthracene by a Rhodococcus sp. FEMS Microbiol.Lett.204: 205-211.
Eder, C.S., Jacques, R.J.S., Bento, F.M., Peralba, M.C.R., Selbach, P.A., Sá, E.L.S. and Camargo, F.A.O.
(2008).Anthracene biodegradation and surface activity by an iron-stimulated Pseudomonas sp.
Bioresource Technology.99(7): 2644-2649.
Esedafe, W.K., Fagade, O.E., Umaru, F.F. and Akinwotu, O. (2015).Bacterial Degradation of the Polycyclic
Aromatic Hydrocarbon (PAH) - Fraction of Refinery Effluent.International Journal of Environmental
Bioremediation & Biodegradation.3(1): 23-27.
Hafez, E.E., Rashad, M., Abd-Elsalam, H.E. and EL-Hanafy, A.A. (2008).The Polyaromatic hydrocarbons
as a serious environmental pollutants and the role of bioremediation to overcome this problem.Accepted
for publication in Environment, Health and Nutrition -Global Issues. S.K. Basu and S. Datta Banik
(Eds.), APH Publishing Corporation, New Delhi, India.
Hassan, E.A., Elsayed, E.H., Azhar, A.H. and Amany, G.A. (2009).Isolation and Identification of Three-
RingsPolyaromatic Hydrocarbons (Anthracene and Phenanthrene) Degrading Bacteria. Ameri-Eurasi. J.
Agri. and Environ. Sci. 5(1): 31-38.
Hyotylainen, T. and Oikari, A. (1999). The toxicity and concentrations of PAHs in creosote contaminated
lake sediment. Chemosphere.38: 1135–1144.
Kadam, T.A. and Gangawane, L.V. (2005). Degradation of phorate by Azotobacter isolates. Indian Journal
of Biotechnology.4: 153-155.
Karale, M., Kadam, T., Bhosale, H. and Maske, K. (2015).Characterization of Anthracene Degrading
bacteria from Drug Industry Effluent Polluted Soil.Archives of Applied Science Research.7 (11): 16-22.
Kastner, M. and Maho, B. (1996).Microbial degradation of polycyclic aromatic hydrocarbons in soil
affected by the organic matrix of compost. Appl. Microbiol. Biotechnol.44: 668–675.
Lotufo, G.R. (1997). Toxicity of sediment-associated PAHs to an estuarine copepod: effects on survival,
feeding, reproduction and behaviour. Mar. Environ. Res. 44: 149–166.
Manohar, S., Kim, C.K. and Karegoudar, T.B. (1999).Degradation of Anthracene by a Pseudomonas strain,
NGK1.Journal of Microbiology.37(2): 73-79.
Matthew, O.N.I. and Amund, D.I. (2000). Degradation of Anthracene by Bacteria Isolated from Oil Polluted
Tropical Soils. Z. Naturforsch. 55: 890-897.

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Meshram, R.L. and Wate, S.R. (2014).Isolation, Characterization and Anthracene Mineralization by
Bacillus cereus from Petroleum Oil Depot Soil.Indian Journal of Applied Research.4(5): 16-18.
Moody, J.D., Freeman, J.P., Doerge, D.R. and Cerniglia, C.E. (2001). Degradation of Phenanthrene and
anthracene by cell suspensions of Mycobacterium sp. strain PYR-1. Appl. Environ. Microbiol.67: 1476-
1483.
Nadalig, T., Raymond, N., Ni’matuzahroh, Gilewicz, M., Budzinski, H. and Bertrand, J.C. (2000).
Degradation of phenanthrene, methylphenathrenes and dibenzothiophene by a Sphingomonas strain
2mpII. Appl. Microbiol. Biotechnol.59: 79- 85.
Neelofur, M., Shyam, P.V. and Mahesh, M. (2014).Enhance the Biodegradation of Anthracene by Mutation
from Bacillus species.BMR Biotechnology Journal.1: 1-19.
Neeraja, P., Madhusudhan, N., Soma shanker, Ravikumar, M. (2013). Isolation and characterization of
anthracene degrading bacteria from soil contaminated with petroleum wastes. Int. J. Res. Pharm. Sci.
4(3): 380-385.
Ni Chadhain, S.M., Norman, R.S., Pesce, K.V., Kukor, J.J. and Zylstra, G.J. (2006). Microbial dioxygenase
gene population shifts during polycyclic aromatic hydrocarbon biodegradation. Appl. Environ.
Microbiol.72: 4078-4087.
Rodrigo, J.S.J., Santos, E.C., Bento, F.M., Peralba, M.C.R., Selbach, P.A., Sa, E.L.S. and Camargo, F.A.O.
(2005). Anthracene biodegradation by Pseudomonas sp. isolated from a petrochemical sludge
landfarming site. International Biodeterioration & Biodegradation.56(3): 143-150.
Ruma, R., Ray, R., Chowdhury, R. and Bhattacharya, P. (2007). Degradation of polyaromatic hydrocarbons
by mixed culture isolated from oil contaminated soil - A bioprocess engineering study. Indian Journal
of Biotechnology.6: 107-113.
Somtrakoon, K., Suanjit, S., Pokethitiyook, P., Kruatrachue, M., Lee, H. and Upatham, S. (2008). Enhanced
biodegradation of anthracene in acidic soil by inoculated Burkholderia sp.
VUN10013.Curr.Microbiol.57: 102-106.
Trindade, P.V.O., Sobral, L.G., Rizzo, A.C.L., Leite, S.G.F. and Soriano, A.U. (2005). Bioremediation of
weathered and recently oil-contaminated soils from Brazil: a comparison study. Chemosphere.58: 545-
522.
Van Hamme, J.D., Odumeru, J.A. and Ward, O.P. (2000).Community dynamics of a mixed-bacterial culture
growing on petroleum hydrocarbons in batch culture.Canadian Journal of Microbiology.46: 441-450.
Wilson, S.C. and Jones, K.C. (1993). Bioremediation of soil contaminated with polycyclic aromatic
hydrocarbons. Environ. Pollut.81: 229-249.
Zhang, S.Y., Wang, Q.F., Wan, R. and Xie, S.G. (2011). Changes in bacterial community of anthracene
bioremediation in municipal solid waste composting soil. J. Zhejiang Univ. Sci. B. 12: 760–768.

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EVS-178
ECO - LABELLING IN INDIA: ISSUES AND CHALLENGES

*Harleen Kaur ** Chhavi Kiran

* Research Scholar, Punjabi University, Patiala, India
[email protected]
+91 9888891315
** Research Scholar, Punjabi University, Patiala, India
[email protected]
+91 9996557347

ABSTRACT
In today’s era, consumers have a wider choice of products with majority of them claiming to be
environment friendly. But the matter of concern is that, are these Products actually not harming the
environment or is this only eyewash? Although India initiated with the concept of Eco-labels in 1991, it is
still struggling to get the products certified. A vast number of reasons are responsible for this. The question
arises that since certification under Eco-labels is voluntarily in India, would it be better if they are mandated
by government at some point of time? What are the reasons why even after all these years Eco-labels like
Ecomark in India has few takers? Other eco-labels like India Organic and the Green Signal that exist in
India have not been able to make a deep mark in Indian Industry. Through this paper, an attempt has been
made to identify the challenges being faced by such certifications in India.
Keywords: Environment, Ecomark, Green washing.

1. INTRODUCTION

Globalization has provided consumers with wide choice in almost each and every product and service
category. It had been complimented by rise in purchasing power of individuals and increased environmental
awareness. Due to this a few manufacturers added some labels stating their products to be ozone free or
biodegradable. Such labels were often used as an excuse for offering products at extravagant prices. This led

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to a need for introduction of some standardized Eco-labels in order to prevent exploitation of consumers and
to ensure environmentally sustainable production processes. Currently, according to Ecolabel Index ,an
online index of Eco-labels, there are 463 Eco-labels in 199 countries across 25 industry sectors . A product
with an Eco-label is a claim that the product is environment friendly. Environmental programs work in
compliance with ISO 14024 standards. The founding member of European Union, Germany was the first
nation to introduce Ecolabel named Blue Angel in 1978 [1]. Being oldest among Eco-labels it is also widely
recognized. According to a survey conducted in 2014, it was found that Blue Angel had 92% brand
awareness and 37% impact on the purchase intentions of the consumers [2].

2. DEFINING ECO-LABELS

"Ecolabelling" is either voluntary or mandatory in which case they are backed by government. In case of
countries with mandatory Eco-labels any imported consignment not confirming to such labels are rejected.
It is a method of environmental performance certification and labeling which has been used across the globe
[1]. A package carrying is a kind of identification that the product is proved to be sound environmentally
[3]. Eco-labeling can be either product oriented or production oriented where product oriented eco-label
implies that the product is environmentally safe and production oriented eco-label highlights that the
production processes are compatible with

environment.

Source: Global Ecolabel Monitor,2010

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A group of standards have been laid down by International Standards Organization (ISO) known as ISO
14000 series of environmental standards. The ISO 14020 family covers three types of labeling schemes:

 Type I is a voluntary, multi-attribute label developed by a third party and awarded for the
products which meet a certain set of criteria, indicating overall environmental prefer ability of a
product within a particular product category based on life cycle considerations.
 Type II is a single-attribute label developed by the producer; hence these are self-declaration
labels [4].
 Type III is an eco-label whose awarding is based on a full life-cycle assessment of a product.
These are voluntary programs that provide quantified environmental data of a product, under pre-
set categories of parameters set by a qualified third party and based on life cycle assessment, and
verified by that or another qualified third party [5].

3. OBJECTIVES: The aim of this paper is to

 Present an overview of existing Eco-labels in India along with the Issues impacting them
 Identify the potential benefits and Challenges of Eco-labels and make recommendations for
increasing their effectiveness

4. ECO-LABELS IN INDIA

Ecomark:

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Ecomark India is an environment friendly Ecolabel introduced by Government of India in 1991. It is

managed by Bureau of Indian Standards (BIS) that is member of International organization for
Standardization (ISO) It covers sixteen product categories namely soaps and detergents, paper, food items,
lubricating oils, packing materials, architectural paints and electronic goods, food additives, wood
substitutes, cosmetics, aerosol propellants, plastic products, textiles, fire extinguisher and leather [6].So far
only 12 manufacturers had applied for this license and 11 were awarded the same.
Reasons for failure of Ecomark in India:

1. Effort was largely directed at developing the criteria across categories rather than implementing it.
2. Lack of consumer awareness and demand regarding this label, hence cannot be effectively used as a
marketing tool. The manufacturers are not deriving any real benefit from the label.
3. Manufactures who are also exporting they prefer applying for labels in the countries of export and
are avoiding bearing dual cost.
4. It is a self-financing label where the manufacturer has to bear the application,
licensing, testing and the renewal costs.
5. Label is complex to obtain as it requires meeting both environment criteria and the
quality criteria set by BIS and carries dual label of ISI by BIS and earthen pot by
Ecomark.
6. Specialized officers in Charge of Ecolabelling frequently got transferred thus lack of continuity in
application side of this Ecolabel
7. Voluntary nature of this scheme also helps manufacturers elude accountability and responsibility.
8. It was set up during Ms Menaka Gandhi ‘s regime as an environment Minster and later it failed to
get required support from the government The CUTS committee cited several bureaucratic and
management reasons for failure of the label [7,8].

Good Weave International –Founded in1994by Kailash Satyarthi, it was previously known as
Rugmark it has a distinction of being internationally recognized Ecolabel associated with social cause. It
is association of non-profit organizations devoted to ending illegal child labor in Rug making industry. It
started work in 2009 to develop a new, expanded certification standard that directly addresses the issue
of forced and bonded labor. It is associate member of ISEAL, International Social and Environmental

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Accreditation and Labeling Alliance. Besides India, Nepal and Afghanistan, Good Weave International
is responsible for licensing throughout Europe and North America. It has offices in six countries, a staff
of 42, and more than 120 licensed importers sell carpets through over 1,000 stores and interior designers
throughout the world. Its success is attributed to stringent standards and credibility. Good weave License
adds to the brand value by assuring the customer that child labor wasn’t used in manufacturing. It
undertakes massive consumer awareness campaigns through ads in prestigious online and print
publications. More than 10,800 children have benefited from the organization’s education and
rehabilitation programs [9] [10].

India Organic:

India Organic certifies the products which are organically produced in India. This certification was
introduced in 2002 and is managed by APEDA or Agricultural and Processed Food Products Export
Development Authority under Government of India. National Standards for Organic Products (2000) are
the underlying standards to which this label confirms. These standards ensure that India Organic
Certified products and raw materials are produced without chemical fertilizers and pesticides or induced
hormones.

The Green Signal:

The Green Signal (TGS) is a comprehensive ecolabel introduced by IIM Ahmadabad on 8th June,
2011.TGS certifies the products for two years [11] However the response to this ecolabel is slow to
catch up due to low visibility among the consumers.

5. BENEFITS:
Eco-labeling has a number of major benefits:
5.1 Creating consumer awareness: Eco-labeling is a very effective tool to make consumers aware
about the necessity of considering environment friendly products and to sensitize them about the
probable impacts of using such products on the environment. Like refrigerators and deodorants
release CFC which are responsible for Ozone depletion [12]. It also promotes energy efficiency,
waste minimization and product stewardship.

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5.2 Stimulating efficiency in an economic manner: Regulatory controls of a nation are often very
expensive to abide by but eco-labeling is usually cheaper. There will be hardly any need to have a
regulation if manufacturers and consumers are empowered enough to take decisions that are
environmentally sound.
5.3 Boosting continuous improvement: Being environment friendly is not something to be followed
just once in order to get the certification but rather must be a continuous process. For every
ecolabel there is a certain time period after which manufacturers need to make efforts from scratch
to get the ecolabel. This ensures continuous improvement [13].
5.4 Encouraging certification: An environmental certification program is a hallmark of approval
which claims that the product meets some standards of eco-label. Consumers get a physical
evidence of concern that the manufacturer holds towards the environment. Also, certification
promotes healthy competition amongst producers which ultimately is beneficial for the
environment and for the consumers. Every eco-label has a logo which helps consumers to
distinguish between the products and is often eye catchy which are an indirect reason for increase
in sales.

6. CHALLENGES OF ECO-LABELS

6.1 Green Washing: Companies with self-proclaimed herbal, recyclable, and biodegradable, natural
terms used for products can be confusing and misleading for the consumers. An ecolabel must be
credible and accurately represent the claims made. In case of green washing in advertisements the
misleading claims can misguide, demotivate the consumer. ISO 14021:1999 is the standard that
deals with the Type –II environmental labels also prohibits the use of vague terms.
6.2 Paucity of Financial and other Resources: Eco-labels rely on the registration fee and renewal
fee as a primary means of financing and sometimes grants from government. In majority of cases
the financial, human or expertise resource crunch poses a challenge.
6.3 Lack of consumer Awareness: Eco-labels in India face apathy as the companies view it as
unfruitful expenditure because of the lack of consumer awareness. Thus, obtaining the ecolabel
adds no real value to the brand value. Also, the voluntary nature of these schemes makes them to
be viewed as dispensable.

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6.4 Petty claims: Some of companies make inappropriate or petty claims that sound impressive to the
consumer but add little to sustainability of the environment.
6.5 Unjust Advantage: Companies have to commit effort and funds to acquire the license of Eco-
labels. These labels can increase the sales and profitability of the companies. While some
companies may be genuinely operating other companies may be making claims but not meeting
the specific environment criteria. This misrepresentation hurts the genuine ones.
6.6 Green consumerism: Green or ethical consumerism is supposed to bring out the necessary social
and environmental change that can help the planet. However, in practical situations the consumers
would not but a product merely if it is green it must be optimal solution to problem they are
looking to solve [14].
6.7 Scope: A large number of products are yet to be included in the environmental labeling programs
as they are voluntary and not mandatory. If they are made mandatory, then they can become more
effective.
6.8 Policy Framework and execution: Policy framed for the formation of Eco-labels must be
followed by execution with equal vigor so that redundancy may not creep in. There are many
Eco-labels licenses of which are not being applied.
6.9 Fragmentation and Lack of Uniformity in Testing Techniques: There are a large number of
Eco-labels that exist each one has own criteria for testing. There is no uniformity across the
different certification methods and there is also absence of information as to which factors must
be considered as most important for reduction in environmental impact. This leads to confusion
and frustration for customer and companies alike.

7. RECOMMENDATIONS

 Formulation of environmental labels that take into all stakeholders account the Industry,
Environmental groups, government, policy makers as well as consumer.

 Efforts committed to raise awareness regarding ethical consumption offsetting carbon credits and
environmental sustainability among the consumers.

 Streamlining of the management and control of Ecolables under single organization.

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 Coordinated action from various policy enforcement bodies and shift from voluntary to mandatory
schemes wherever possible.

 Time taken to certification must be shortened.

 Duration for which the manufacturer can display the label before the reassessment has to be done
should be uniform and clearly stated.

 The Eco-labels must be identified, consolidated and globally accepted. This would avoid the
duplicity and dual payment of fee.

 The methods used for giving ecolabel certification must be transparent as well as stringent.

8. CONCLUSION:
Just as a coin has two sides, Eco-labels also have some benefits and is facing some challenges as
well. Though such labels assist in monitoring, encourages certification and helps in continuous
improvement still it has not proved to be successful in India as it has been in other nations. Green
washing is a major issue due to which the essence of introducing Eco-label has failed, rather
producers are using catchy environmental phrases just to lure the customer without actually being
environment friendly. Financing is also an issue which has cropped up in getting a product certified
with an Eco-label. Ecomark which was introduced in India in 1991 with great hopes of Indian
products meeting international standards of environmental protection failed. Still if manufacturers,
service providers and Government of India join hands together, such certifications can prove to be of
great success and can be highly advantageous in safeguarding the environment.

REFERENCES

1. Panda, L. K., & Goswami, S. (2009). Ecolabel and Its Environmental Countenance. Orissa Rev, 64-
71.
2. https://www.blauer-engel.de/en/blue-angel/what-is-behind-it/an-environmental-label-with-a-long-history
accessed on March21, 2016.
3. Chavan, R.B. (2001) Indian Textile Industry-Environmental Issues. Indian Journal of Fibre and
Textile Research. Vol 26, 11-21.

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4. http://www.ecolabelindex.com/Eco-labels/?search=india&as_values_00=
5. http://www.globalecolabelling.net/what-is-eco-labelling accessed on March23, 2016.
6. http://www.environmentallawsofindia.com/eco-mark.html accessed on March23, 2016.
7. https://ecosafesibm.wordpress.com/2009/07/10/why-eco-mark-failed-in-india/ accessed on March23, 2016.
8. http://lex-warrier.in/2013/11/indian-eco-labelling-scheme-ecomark/ accessed on March27, 2016.
9. http://www.goodweave.in/index.php/licensee-exporters/licensing accessed on March27, 2016.
10. http://www.takepart.com/article/2014/01/06/one-loom-time accessed on March27, 2016.
11. http://cbalance.in/downloads/attachment-5.pdf accessed on March25, 2016.
12. https://www.iisd.org/business/markets/eco_label_iso14020.aspx accessed on March23, 2016.
13. Yau, Yung (2012). Eco-labels and willingness-to-pay: a Hong Kong study. Smart and
SustainableBuilt Environment, 1 (3), 277-290.
14. https://center.sustainability.duke.edu/sites/default/files/documents/Eco-labelsreport.pdf accessed on
March22, 2016.

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EVS-179
Role of Community Awareness in preserving the Environment

*M. B. Saddi

**Physics Department, Mata Ganga Khalsa College for Girls,

KOTTAN (District Ludhiana) Punjab - 141412

E-mail: [email protected], Tel: +91 0 9872235057

Abstract:

Our community can play a vital role in preserving the environment. Community can be made aware
about environment in many ways. In Punjab, Punjab Pollution Control Board is constructed for safeguard of
environment. It works under the administrative control of the Department of Science, Technology &
Environment, Government of Punjab headed by Hon'ble Chief Minister of Punjab. All the people should be
aware about the Laws/ acts constituted for preserving the environment. Many local organisations, NGO’s,
clubs, NCC, and NSS etc. are working for the community awareness. Many events are organised, special
days are celebrated for community awareness in preserving environment. World environment day is
celebrated on 5th June every year in the entire world. Baba Balbir Singh Seechewal in Punjab and Sh.
Sunderlal Bahuguna in Uttrakhand are the famous environmentalists who are making efforts for the
awareness in community for preserving the environment.

Environment and community:

Environment term seems to have been derived from French word “environir”, which means ‘to
surround’. Park defined it as a sum total of conditions which surround a human at a given point in space and
time. The environment can also be defined as circumstances or conditions that surround an organism.

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Our community tended plants with affection and reverence. People worshipped the plants. Watering
of plants and trees was considered a religious duty by them. The same was true of wild life. Many animals,
birds and insects were given the status of God. People consider ‘Tulsi’ as Devi, snakes were offered milk,
birds were given grains, even ants were provided with flour at ant hills. Even people could sacrifice their
lives for plant protection. There is a village in Jodhpur region of Rajasthan where the people hugged tree
and said that they would have to be killed before trees.

Celebration of Special Days:

Many days are celebrated for community awareness in preserving environment. The government at
the centre and in various states have a number of schemes for environment awareness and education.
Ministry of environment in central government And departments of environment in different states
contributes towards this. They prepare posters, produce films, hold seminars and workshops, spend on
advertisements in newspapers and sponsored programmes on the electronic media, organize exhibitions and
observe Wild life week ( 1 to 7 October), National Environment Awareness month (19 Nov to 18 Dec.).
Special days like World Environment day (5 June), Vana Mahotsava, World Nature day (3 Oct.), Earth day
(22 Feb.), World Forest day (21 March) etc. are celebrated.

Conservation of Environment:

Different environmentalists have different views about conservations of environment. According to

Anthropogemi view:

 Man is highest class organism made by nature. Man has been send on the earth to rule the other
species and use them.
 Human development depends mainly on exploitation and development of natural resources.
According to Environmentalist ethic, man should use natural resources in a judicious way, keeping
in mind the needs of future generations. Conservation of nature and natural resources is the basic point of
environmental ethics.

Environment education has been made a compulsory subject in schools/ colleges by the orders of
Supreme Court. Environment awareness and sensitivity about environment will create two main issues

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related to ethics. One is ethical values of nature and to give importance to nature. Our ancestors gave
importance to the nature. They considered the forest the place of Moksha. Every religion is related to its
conservation and moral values because they directly or indirectly give us something.

Many events are organised for the conservation of environment. Every individual has the
fundamental right to seek a healthy environment to live in. Many international scientific programmes
concerning ecological issues have been initiated. Some are the UNESCO Arid Zone Programme (1951-64).
The ICSU international biological programme (1964-74), collaborative work with United Nations groups
(WHO, FAO, ILO and IAEO etc.)

Environmental Laws in India:

India having enacted over 200 laws for the protection and improvement of environment. The main
among these are:

 The Wild Life (Protection) Act of 1972.

 The Water (Preservation and Control of Pollution) Act 1974.
 The Forest (Conservation) Act of 1980.
 The Air (Prevention and Control of Pollution) Act 1981.
 The Environment (Protection) Act of 1986.
 The National Environment Tribunal Act of 1995.

Balbir Singh Seechewal:

Balbir Singh Seechewal is a Nirmala Sikh who is Punjab’s most famous eco-activist, spearheading
an anti-river pollution campaign. By combining his assiduously cultivated self-help philosophy with the
environmental essence of Gurbani, Babaji has resurrected the 110 miles long Kali Bein rivulet.

In his latest project in early 2009, taking up the cudgels to save Buddha Nullah. Seechewal says that
when he started the water cleaning project of Kali Bein in 2007, it was a challenging task. But as people

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become aware of its importance, they joined in cleaning the rivulet. Seechewal lays steps on understanding
the importance of river water. Water is water; we need water just like we need air to breathe. A wave has
started from Punjab’s Kali Bein rivulet and we want to spread not only across India but also across the
whole world.

Sunderlal Bahuguna:

Sunderlal Bahuguna was born on 9 January 1927. He is a noted Garhwali environmentalist, Chipko
Movement vander and a follower of Mahatma Gandhi’s philosophy of non-violence and Satayagraha. The
idea of Chipko Movement was of his wife Vimla Bahuguna and the action was taken by him and first as a
member of the Chipko movement in 1970 and later spearheaded the Anti-Tehri Dam movement starting
1980 to early 2004.

Sunderlal started social activities at the age of 13, under the guidance of Shri Dev Suman who was a
nationalist spreading a message of non-violence. Inspired by Gandhi ji he walked through Himalayan forests
and hills covering more than 4700 Kms by foot and observed the damage done by mega developmental
projects on fragile eco-system of Himalayan.

Chipko Movement was started by him in 1973 in UP in an effort to save trees and forest. In Hindi
Chipko means ‘To Stick’ and it later inspired ‘Appiko movement’ in Karnataka. Sunderlal’s notable
contribution was his creation of Chipko’s slogan “Ecology is Permanent Economy”

References:

Chandna, R.C (1998) Environmental Awareness, Kalyani Publishers, New Delhi.

Yadav, J.S. et.al. (1998) An Elementary Book On Environmental Education.Publication Bureau, Panjab
University, Chandigarh.

Dani, H.M. (1996), Environment Education (Scientific, Social & Legal Aspects), Publication Bureau, Panjab
University, Chandigarh.

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EVS-180

An Assessment of Potential Biomass Waste in the States of Goa,

Chhattisgarh, Madhya Pradesh and Maharashtra.

*Sonam Poptani

Affiliation: MU College of Commerce

Email: [email protected]

Abstract

Biomass waste is a renewable source of energy whose potential has largely been untapped or has remained
unassessed in India . It can help beridge the demand supply gap for cheap, easily accessible renewable
energy in India. The paper attempts to analyse the Biomass waste potential in four states of Maharashtra,
Goa, Madhya Pradesh, and Chhattisgarh in India. Biomass waste has become a need of the hour given
India’s rising emissions and waste management problem. Managing biomass waste in India, especially in
these four states, can help solve several problems as well as help economic development of these states.

The paper takes a look at what consists of biomass as well as biomass wastes and which types of biomass
wastes are significantly available with the help of statistics and studies previously available in the above
mentioned four states and attempts to draw some conclusions based on those data and analyses.

Key Words: Biomass Waste Management, Agriculture waste Management, Municipal Waste, Renewable
energy

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Introduction
Biomass waste consists of all those organic wastes that occur naturally from plant or animal sources. These
include everything from woody biomasses such as pine needles to animal waste generated among
slaughterhouses. Biomass waste can be a significant source of energy (Zafar, 2015)
In developing countries like India, biomass energy can help bridge the gap between demand and supply of
cheap, renewable, easy to access energy for household and industrial use. Biomass energy is already being
used in rural households in India in the form of biogas plants, firewood , cow dung and plant stalks for
cooking. Biomass briquettes are also used comprehensively in industrial sector where as rice husk is used
significantly for power generation. However, it is important to assess if there is further potential for the use
of biomass in India, especially in states like Maharashtra, Goa, Madhya Pradesh, and Chhattisgarh which
have dense forests, significant farmlands as well as plenty of livestock and yet, are perennially short of their
power generation targets.
This paper is an attempt to, at the very least, begin to assess the biomass waste energy potential in these four
states.

Literature Review
Biomass waste is being studied by a number of entities, right from the United Nations Environment
Programme to the European Union to private business involved in the field of energy.
“Biomass is biological material derived from living, or recently living organisms. In the context of biomass
for energy this is often used to mean plant based material, but biomass can equally apply to both animal and
vegetable derived material.”(BIOMASS Energy Centre, 2011)
Significant among these sources is agricultural waste. “Agricultural waste is waste produced as a result of
various agricultural operations. It includes manure and other wastes from farms, poultry houses and
slaughterhouses; harvest waste; fertilizer run- off from fields; pesticides that enter into water, air or soils;
and salt and silt drained from fields.”(United Nations, 1997).
Among agricultural waste, crop residues have been significantly studied in India by reports such as
(Technology Information, Forecasting and Assessment Council (TIFAC) , 2009; (Dubey, Chandra, Padhee,
& Gangil, etc.
Municipal solid waste too has been studied comprehensively by State Pollution Control Boards as well as
likes of Annepu (2012)
However, an important source of biomass which is also a majore waste management problem in large farms,
animal dung , is yet to be officially studied.
Similarly, there is very little known about other important sorces such as slaughterhouse waste.

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Methodology

a) Data for Agricultural Waste

The Data for Agricultural waste has been collected using two method:
1) Reported data from a study conducted earlier: The TIFAC ( Technology Information Forecasting and
Assessment Council, India) report that was published in 2009 gives estimates of crop residues from different
states in India for various crops. The methodology that was used to conduct this study was by collecting
primary data directly from the field. Various study teams from the institutions visited agricultural fields in
every district that were treated as samples. They weighed the crop residues first hand for various crops and
estimated the total weight of the crop residues for the entire district. An aggregate of the crop residue
estimates for the entire district gives the data for the crop residues for the entire state. This formed the
Biomass potential from agricultural waste in the study.
The same methodology was also used to calculate data for the use of agricultural residues by the farmer.
The agricultural waste that was not used by the farmer as a part of the total biomass potential was classified
as total biomass waste available.

2) Extrapolations using Crop Residue Ratios

The Second method used for collecting data for the Biomass inventory is by using data for available crop
residue ratios as given by IISc, CGPL 2007.

Crop Residue Ratios

The Combustion, Gasification, Propulsion Laboratory (CGPL), Indian Institute of Science, Bangalore:, in
their study for potential energy from agricultural waste used Remote Sensing data and statistical crop data
made available by MNRE for the years 2002-2004(Sheshagiri, Rajan, Dasappa, & Paul, 2007).
The Crop Residue Ratios estimates for the study were calculated using following formula:
CRR ( Crop Residue Ratio)= Residue Yield (Tonnes per Hectare) / Crop Yield (Tonnes per Hectare)In this
document, CRR method refers to this method used.

We used some of the calculated Crop Residue Ratios and multiplied them with the latest crop
statistics to obtain the residue yield for the year 2010-2011. The year 2010-2011 were used , because at
this stage , this was the year where the data for crop production in all the four states was available.
Agricultural Statistics
Latest Crop statistics were taken from published data by the Directorate of Economics and Statistics, India.
 According to the methodology given by the Directorate , data for oilseeds refers to the cluster of nine
oil seeds prominently cultivated in India.
 Agricultural statistics are given in Million Metric Tonnes (MMT).

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b) Data for Municipal Waste

Data for Municipal Solid waste was taken from a research study jointly conducted by Columbia University
(location of the study was India) and National Environment Engineering Research Institute, Nagpur, India.
The figures listed by this study are used by respective State Pollution Control Board statistics for pollution
in the respective state for the year 2010-11.

 According to study, on an average, around 52 % of the total Municipal Solid Waste generated
in India is biodegradable. This is the calculation that is used for calculating biodegradable
MSW generation for this report.
 Data was recorded as tonnes per day,

c) Other Sources
 Data for Woody Biomass excludes woody biomass from agricultural sources and forestry biomass. It
primarily includes woody biomass from waste lands .It includes species like ProsopisJulifora,
Casuarina, Ipomoea and Eucalyptus.
 Data from sewage sludge is taken as it is from reports by central Pollution Control Board. Data was
given as million litres per day (MLD).
 There us a lot of waste available at private or community level. This included Cow dung and other
animal litter including poultry litter, waste from vegetable markets, waste from fish markets , waste
from slaughter houses, waste from industries etc. However, very little updated reliable data is
available. The data available is from informal sources or too outdated.

Data Summary
Goa
Agricultural Waste
Goa is one of the smallest states in India and does not have much agricultural activity. Hence, very little
agricultural and horticultural residue is generated. There is more biomass available from horticultural crops
and from orchards than from agricultural crops.
 While TIFAC, 2009 has given no information about agri-waste in Goa. The other important agri-
waste generating crop is Rice. Rice generated a total residue of 0.367 MMT in 2010-2011 according
to CRR extrapolation method used by us.
 The other crops that generate small amounts of residue are maize, sugarcane and ragi.
 The horticultural crops that generate a significant amount of biomass waste are coconut and cashew
nut, although it is difficult to pin point the total quantity.
Municipal Solid Waste
 A large contribution to the Municipal solid waste comes from the flourishing tourism industry in
Goa. The state generatedapproximately 41 tonnes of biodegradable Municipal solid waste per day in
the year 2010-11 .(Annepu, 2012)

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Other Waste
 Sewage generation stood at 23.62 MLD in 2005-06. (Central Pollution Control Board, 2007).
 There is a negligible amount of woody biomass available.
 Other waste from Goa comes from the fishing industry. Although no quantitative data is available in
this regard, a considerable amount of fish waste such as fish scales aregenerated every year.
Although it is assumed, that much of this waste goes in Municipal solid waste, some of this waste
could be dumping in the sea.
 There is waste from orchards such as cashew plantations and mango plantations which is available.
In an informal conversation with a cashew plantation owner, it was revealed that the dry leaves that
fell on the ground were gathered and burned at his plantation in order to minimise fire hazard.

Chhatisgarh
Chhatisgarh is a newly formed state in India. Due to land re-allocation to Madhya Pradesh and Chhatisgarh,
reliable crop statistics were not found from many sources in Chhatisgarh. However, the majority of the
agriwaste production in the state comes from its oil seeds.
Agricultural Waste
 Out of the various crops, rice was the crop that generated the largest quantity of agri-waste for
Chhatisgarh. According to TIFAC, 2009, residues from rice fields stood at 7.2 MMT in 2007 out of
which 0.6 MMT was available as surplus.
 According to CRR method, the other significant contributors to biomass waste generation in the state
are oilseeds and pulses.
Municipal Solid Waste:
 The state generated approximately 894 tonnes of biodegradable Municipal solid waste per day in the
year 2010-11 .(Annepu, 2012)

Other Waste
 According to Indian Institute of Science, 2007, the Woody Biomass availability stood at 87.0
Tonnes/ yearwith a power potential 87.0 MWe per year
 Sewage Sludge Generation stood at 350.47 in 2005-06. Out of this total capacity 69 MLD was
treated leaving a potential of 281 MLD (Central Pollution Control Board, 2007).

Madhya Pradesh
Agricultural Waste
 Majority of the biomass waste of the state came from agricultural crops.
 Most notable among these are wheat which generated approximately 13.72 MMT in the year 2010-
11 according to estimates using CRR method. According to TIFAC, 2009, the total agricultural
residue for the year 2007 was 10.6 MMT. However, it reported that only 0.9 MMT of this was
available and the rest was used.

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 The other significant waste producing crops were the nine oil seeds. TIFAC, 2009, estimated them to
be 13.8 MMT for 2007. Out of this , only 4.1 MMT was available.
 Madhya Pradesh also has a considerable quantity of agricultural waste from Sugarcane, onions,
grapes, cotton, maize and pulses. However, according to TIFAC, 2009, very little of this biomass is
available in surplus.
 Approximately, 0.9 MMT of Water Hyacinth was available as biomass for 2007 (TIFAC, 2009).
Municipal Solid Waste
 The state generated approximately 2295 tonnes of biodegradable Municipal solid waste per day in
the year 2010-11 .(Annepu, 2012)

Other waste
 According to Indian Institute of Science, 2007, the Woody Biomass availability stood at 41.3
Tonnes/ yearwith a power potential of 5789.8 MWe per year.
 Sewage Sludge Generation stood at 1248.72 in 2005-06. Out of this total capacity 186.1 MLD was
treated leaving a potential of 1062.62 MLD(Central Pollution Control Board, 2007).

Maharashtra
Agricultural Waste
 Approximately 9.98 MMT of Agricultural biomass waste was generated from fields in Maharashtra
for the year 2010-11 according to CRR method.
 Sugarcane is another significant crop that generated biomass waste.TIFAC, 2009 reported residues
from sugarcane tops at 21.6 MMT out of which 17.3 MMT were surplus. According to CRR method,
sugarcane tops agri-waste stood at 49.3 MMT for 2010-2011.
 However, according to TIFAC, 2009, sugarcane from Maharashtra generated 22.4 MMT of Bagasse
, out of which only 1.1 MMT remained surplus.
 Other significant crops with surplus residues were Jowar with 0.8 MMT of surplus biomass residue
out of the 8.2 MMT residue generated and cotton with 2.6 MMT of surplus waste out of the 8.8
MMT waste generated in 2007.
 Other crops with significant residues but surplus agri waste residues were Maize, wheat bajra and
chilli.
 Water hyacinth production stood at 0.7 MMT out of which 0.7 MMT were available.
Municipal solid waste
 The state generated approximately 11377 tonnes of biodegradable Municipal solid waste per day in
the year 2010-11 .(Annepu, 2012)

Other waste:
 According to Indian Institute of Science, 2007, the Woody Biomass availability stood at 27.8
Tonnes/ year with a power potential of 3886.4MWe per year.

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 Sewage Sludge Generation stood at 9986.29 MLD in 2005-06. Out of this total capacity 4225.25
MLD was treated leaving a potential of 5671.04(Central Pollution Control Board, 2007).
 In a few informal discussions with farmer, animal litter came out to be a significant source of
biomass waste as one farmer reported an estimated 300 kgs. daily of animal litter on a hundred
acres farm in Maharashtra. This included goats, sheep, cows, buffaloes etc.
 According to an interview conducted, the Agricultural Produce Marketing Committee vegetable
market at Mumbai generated about five tonnes of vegetable and animal waste every day. Similarly,
in Pune, the Mahatma Phule vegetable market at Market Yard generated three tonnes of vegetable
waste everyday. This shows that there is a lot of biodegradable waste available at a community level
in vegetable markets everyday and it is assumed that this vegetable waste is dumped at Muncipal
garbage dumps and is counted in Municipal Solid Waste.

Conclusion
It is important to study biomass residue, especially in a developing, energy short country such as India.
However, there is a significant lack of data to make comprehensive conclusion. In all the four states,
agricultural crops are a significant source of biomass waste but one cannot conclude the availability of the
waste of these, until it is established that these sources are not being put to any other use.

Bibliography
Annepu, R. K. (2012). Sustainable Solid Waste Management in India. New York: Waste-to-Energy
Research and Technology Council (WTERT).
BIOMASS Energy Centre. (2011). What is biomass. Retrieved March 29, 2016, from Biomass Energy
Centre: http://www.biomassenergycentre.org.uk/portal/page?_pageid=76,15049&_dad=portal
Central Pollution Control Board. (2007). Status of Sewage Treatment in India. (CUPS/61/2005-06).
Dubey, A. K., Chandra, P., Padhee, D., & Gangil, S. (2016, March 29). Energy from Cotton Stalks and other
Crop Residues. https://www.icac.org/projects/CommonFund/20_ucbvp/papers/15_chandra.pdf: ICAC,
Bhopal.
Indian Institute of Science. (2007). Assessment of Biomass Resource and its Power Potential using Remote.
(G. Sheshagiri, N. Rajan, & H. Mukunda, Eds.) Bangalore: Central Cobustion and Propulsion Lab., .
Sheshagiri, G. S., Rajan, N., Dasappa, S., & Paul, P. J. (2007). AGRO RESIDUE MAPPING FOR INDIA.
Retrieved 1 19, 2013, from
http://cgpl.iisc.ernet.in/site/Portals/0/Publications/InternationalConf/AGRO%20RESIDUE.pdf
Technology Information, Forecasting and Assessment Council (TIFAC) . (2009). Study on Avaialbility of
Indian Biomass Resources for Expolitation. (N. I.-D. Technology, Ed.) Trivandrum: The Business and
Industrial Research Division of IMRB international.
United Nations. (1997). Glossary of Environment Statistics,Studies in Methods, Series F, No. 67,. New York
City, USA: United Nations.

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Zafar, S. (2015, September 22). Waste As a Renewable Energy Source. Retrieved March 29, 2016, from
Alternative Energy: http://www.alternative-energy-news.info/waste-renewable-energy-source/

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MATH181

AN APPLICATION OF MATLAB TO SOLVE HIGHER ORDER ORDINARY

DIFFERENTIAL EQUATIONS
Mukesh Grover(Assistant Professor)
Department of Applied Mathematics,[email protected]
Giani Zail Singh Campus college of Engraining and Technology ,
Maharaja Ranjit Singh State Technical University,
Bathinda – 151001, Punjab (India)
Abstract
The MATLAB platform is optimized for solving engineering and scientific problems. The matrix-based
MATLAB language is the world’s most natural way to express computational mathematics. Built-in
graphics make it easy to visualize and gain insights from data. A vast library of prebuilt toolboxes lets you
get started right away with algorithms essential to your domain. In this paper, I have written a MATLAB
routine that applies this method to any system of differential equation, in any dimensions, and finds
solutions satisfying a given error bound. An explicit MATLAB algorithm for the implementation of Runge-
Kutta method of orders 4 and 5 is given. The running time and maximum errors for the two methods are
compared on Lorenz Equation.
Keywords:
MATLAB, Runge-Kutta of order 4 and 5, Lorenz Equation, Numerical Solution, System of Ordinary
differential equations.
1. Introduction

Millions of engineers and scientists worldwide use MATLAB to analyze and design the systems and
products transforming our world. MATLAB is in automobile active safety systems, interplanetary
spacecraft, health monitoring devices, smart power grids, and LTE cellular networks. It is used for machine
learning, signal processing, image processing, computer vision, communications, computational finance,
control design, robotics, and much more. Numerical analysis is considered as a new approach to scientific
discovery. Experiments give insight into possible theories, theories inspire experiments and experiments
reinforce or invalidate theories. Data obtained from the experiment has created the importance of numerical
analysis and collaboration between the mathematicians and scientists. Numerical analysis is concerned with
all aspects of the numerical solution of a problem, from the theoretical development and understanding of
numerical methods to their practical implementation as reliable and efficient computer programs. The most
popular programming languages for implementing numerical analysis methods such as C, C++, Java and
FORTRAN are used for numerical analysis. Best known of these programming Software is MATLAB, a
commercial package that is arguably the most popular way to do numerical computing. MATLAB has a
number of tools for numerically solving ordinary differential equations. We will focus on the main, the
built-in function ode45, which implement versions of Runge-Kutta 4th and 5th-order, respectively. Systems
of ordinary differential equations are very common in many applied sciences and engineering problems as
well as within mathematics itself. Unfortunately, most of these equations are nonlinear whereas most of the
methods of solution are linear. The method of Runge-Kutta is one of the well-known numerical methods for

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differential equations. The common versions are order 4 and order 5.The advantage of using such an explicit
M-file rather than MATLAB's built-in solvers like ode45 [3] is that we have greater control in the inner
workings of the program. We can specify the step size, maximum error level, time limit etc. We can start
with more than one initial point and plot the result. Also, the algorithm is more pedagogical and is used to
illustrate the method of Runge-Kutta in numerical analysis.

2. Lorenz Equation
The Lorenz equation is commonly defined as three coupled ordinary differential equation like
(1)

Where the three parameter , , are positive and are called the Prenatal number, the Rayleigh number, and a physical
proportion, respectively. It is important to note that the x, y, z are not special coordinate.

3. Runge-Kutta Methods of 4th and 5th Order

Consider the system of ordinary differential equations
= f1(x1, x2… x n, t)

= f2(x1, x2… x n, t)

= fn(x1, x2… x n, t) (2)

which can be expressed more simply by

where x is an n-dimensional vector. This is a non-autonomous equation. If we replace the right hand side by
f(x), that is, if we eliminate the explicit time-dependence, we will obtain an Autonomous equation. If the
function f on the right hand side is nonlinear, we will need a numerical technique. We can use Taylor
expansions, but they require the calculation of derivatives of the functions fn, which is impractical. The
Runge-Kutta methods have the same accuracy as Taylor at any order, yet there's no need for derivatives.
Suppose we know the x at the time tn. Let's call it xn. Then we calculate x at tn+1 = tn+ has follows:

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Runge -Kutta Method of Order 4 Runge -Kutta Method of Order 5

k1 = h f(tn, xn) k1 = h f(tn, xn)
k2 = h f(tn+ , xn+ ) k2 = h f(tn+ , xn+ )
k3 = h f(tn+ , xn + ) k3 = h f(tn+ , )
k4 = h f(tn+ h, xn+k3)
k4 = h f(tn+ ,xn+ )
xn+1 = xn+ (k1 + 2k2 + 2k3 + k4)
….……(4) k5 = hf (tn+ , )
k6= hf (tn+ h, )

xn+1 = xn+ (7k1 + 32k3 + 12k4 + 32k5+ 7k6)......(5)

4. Application of Lorenz Equation in MATLAB
As already the Lorenz equation has been discussed in equation (1), now let us see, MATLAB containing the
Lorenz equation appearing as an M-file.

Let us take = 10, = 8/3, and = 28, as well asx (0) = −8, y (0) = 8, and z (0) = 27. The MATLAB M-file
containing the Lorenz equations appears below
Function x prime = Lorenz (t,x);
%Lorenz: Computes the derivatives involved in solving the%Lorenz equations
meu =10;
beta=8/3;
gamma=28;
x prime=[-meu*x(1) + meu*x(2); gamma*x(1) - x(2) - x(1)*x(3); -beta*x(3) + x(1)*x(2)];

Observe that x is stored as x (1), y is stored as x (2), and z as stored as x (3). Addition all y prime is a
column vector, as is evident from the semicolon following the first appearance of x (2). If in the Command
Window, we type
>>x0=[-8 8 27];
>>tspan=[0,20];
>> [t,x] =ode45 (@Lorenz, tspan, x0)

Though not given here, the output for this last command consists of a column of times followed by a matrix
with three columns, the first of which corresponds with values of x at the associated times, and similarly for
the second and third columns for y and z. The matrix has been denoted x in the statement calling ode45, and
in general any coordinate of the matrix can be specified as x (m, n), where m denotes the row and n denotes
the column. What we will be most interested in is referring to the columns of x, which correspond with
values of the components of the system. Along these lines, we can devote all rows or all columns by a
colon: In following example, it refers to all rows in the first column of the matrix x; that is, it refers to all

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values of our original x component. Using this information, we can easily plot the Lorenz strange attractor,
which is a plot of z versus x:
>>plot(x (:,1),x(:,3)) See Figure 1.1

Of course, we can also plot each component of the solution as a function of t, and one useful way to do this
is to stack the results. We can create Figure 1.2 with the following
MATLAB codes
>>subplot(3,1,1)
>>plot(t,x(:,1))
>>subplot(3,1,2)
>>plot(t,x(:,2))
>>subplot(3,1,3)
>>plot(t,x(:,3))

Figure 1.1the Lorenz Strange Attractor

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Figure 1.2 Plot of coordinates for the Lorenz equations as a function of t.

Example: the given Lorenz Equations are

Is a special case of Lorenz equation that exhibits chaotic orbits? The highly sensitive nature of the solution
of the initial conditions was discovered by Lorenz in 1963.[2] Theoretical properties of Lorenz system,
which was originally used to model fluid circulation in atmosphere, is the subject of dynamical systems and
chaos theory. [7]In this paper, what is interesting about Lorenz equation is the difficulty of using numerical
methods to reach a given error bound. We have solved this equation with the initial condition

X (0) = for 0 t 20.s (6)

This orbit is an example that shows sensitive dependence on initial conditions.MATLAB file solves the
Lorenz equation using Runge- Kutta Method of order 4 or 5.By changing the first few lines, we can give the
equation, initial point(s), step size, maximum running time, maximum error and the order of the method.
The program will halt if the error limit is satisfied or time limit exceeded, whichever comes first. The
program above has been run separately for orders 4 and 5. There resulting errors and program runtime is
given below:
Runge-Kutta of 4th order Runge-Kutta of 5th order
Step Size No.of Time Error Step Size No.of Time Error
Steps Steps
0.0025 8000 35.5 10.72 0.005 4000 27.0 26.5
0.00125 16000 70.9 1.40 0.0025 8000 53.8 2.97
0.000625 32000 141.8 0.11 0.00125 16000 107.4 0.087
0.0003125 64000 282.9 0.0077 0.000625 32000 214.6 0.0027
0.00015625 128000 564.1 0.00050 0.0003125 64000 428.0 0.000083
Table 1.1Comparison of Data using the two Methods

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At first, order 4 seems to have an advantage, it gives more accurate results for smaller running time, but as
step sizes decrease, order 5gives better results. On the other hand, the error decreases by 1/16 for order 4
and 1/32for order 5. This gives the method of order 5 superiority in the long run. The graph of the resulting
solution is given below. The graphs for the two methods are identical:Fig. 1.3 Solution of Lorenz Equation
for t = 0 - 20 in 3-D Fig.1.4 Solution on xy -plan

1.3 1.4

Figure 1.5 Projection of the Solution on xz-

plan

Figure 1.6 Projection of the Solution on yz-plan

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Conclusion
Computer algebra systems are basic requirements for the nonlinear systems of differential equations. Many
packages programs exist to solve such system, but an explicit routine has certain benefits: Different
methods can be contrasted and compared
The Inner workings of the numerical methods will be understood for students.
Parameters like maximum running times; step size etc. cans be controlled.
In this paper I implemented Runge-Kutta methods of order 4 and 5 by a MATLAB m-file, and compared
them on the Lorenz equation. For smaller step sizes, Runge-Kutta method of order 5 clearly gives smaller
errors for a given running time.
References
[1] C. Sparrow, the Lorenz Equations: Bifurcations, Chaos, and Strange Attractors, Springer-
Verlag, New York, 1982
[2] Lorenz E., 1963, Deterministic nonperiodic ow, J. Atmospheric Science 20:130-141
[3] Shampine, L. F. and M. W. Reichelt, 1997, the MATLAB ODE Suite SIAM Journal on
Scientific Computing, 18; 1-22
[4] U. M. Ascher and L. R. Petzold, Computer Methods for Ordinary Differential Equations and
Differential-Algebraic Equations, SIAM, Philadelphia,1998.
[5] K. E. Brenan, S. L. Campbell, and L. R. Petzold, Numerical Solution of Initial Value
Problems in Differential-Algebraic Equations, SIAM, Philadelphia,1996.
[6] L. F. Shampine, Numerical Solution of Ordinary Differential Equations, Chapman and Hall,
New York, 1994.
[7] K.T.Alligood, T.D.Sauer,J.A.Yorke, 1996, Chaos: An Introduction to Dynami-cal Systems,
Springer-Verlag
[8] L. F. Shampine and M. W. Reichelt, The MATLAB ODE suite, SIAMJournal on Scientific
Computing, 18 (1997), pp. 1-22.
[9] P. Bogacki and L. F. Shampine, A 3(2) pair of Runge-Kutta formulas, Applied Mathematics
Letters, 2 (1989), pp. 1-9.
[10] R. M. Corless, G. H. Gonnet, D. E. G. Hare, D. J. Jeffrey, and D. E.Knuth, On the Lambert
W function, Advances in Computational Mathematics, 5 (1996), pp. 329-359.
[11] Grover Mukesh , Tomer Arun ,New variational iteration decomposition method for solving twelfth
order boundary value problems International Journal of the Physical Sciences Vol. 7(1), pp. 81 - 88, 2
January, 2012.

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FM-101

A Study of Synchronized functioning of Indian Primary and Secondary

Market
*Sheena Chhabra ** Dr (Ms) Ravi Kiran
*Research Scholar, School of Humanities and Social Sciences, Thapar University, Patiala-147004
Email: [email protected]
**Professor, School of Humanities and Social Sciences, Thapar University, Patiala-147004
Email: [email protected]

Abstract
The present study tries to analyse the simultaneous functioning of secondary market fluctuations and the listing day
returns of IPOs during 2005-12. The listing day returns have been measured through market adjusted excess return
(MAER). The results indicate that during boom in the secondary market and mandatory IPO grading in 2007, the
number of offerings increased from 54 to 72 in number in 2006. During boom in secondary market (2005-08), the
average under-pricing varied from 8.21% to 38.55%, thus the first day returns for the investors are around 40%. But
the scenario is quite different during depressed phase (2009-12) where the returns are in the range of 0.44% to
11.13%.

Keywords: Primary market, Secondary market, Recession

1. INTRODUCTION

The Indian capital market has a long history, but it remained on the periphery of the financial system.
Various reforms have been undertaken since the early 1990s by the Securities and Exchange Board of India
(SEBI), regulatory body to keep a check on the functioning of Indian Capital market. The Government have
also brought about a significant structural transformation in the capital market which made the equity
market more advance and transparent.Long-term resources are important for financing majority of the
projects which lead to the development of an economy. The long term funds required to successfully run an
organization can be arranged internally as well as externally. Internally, funds can be raised through

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Retained profits and Provision for depreciation whereas externally, the modes of raising funds are Equity
Capital and long term loans. Out of the two external sources, corporations prefer equity capital or IPOs
(Initial Public Offerings) because the low cost of capital for equity capital and in case of poor performance;
the liabilities are distributed among all the shareholders.

Companies prefer to go public as it improves their profile and increases public awareness and its prestige.
Ritter & Welch (2002) discuss that companies offer new issues as during IPOs, owners can get higher prices
for their shares than through outright sale. IPOs also allow dispersion in the ownership. The functioning of
primary market (IPOs) is influenced by the activities going on in secondary market. The same has been
proved by Lee (2003) who indicates that the fluctuations in the stock market affect the new issues as market
movements are a contributing factor towards the total returns. These fluctuations can be incorporated while
measuring the performance by considering the market indices. The performance can be measured by market
adjusted excess returns (MAER) as it takes into account the fluctuations in the daily returns (Ritter, 1991;
Eyssell & Kummer, 1993).

In order to sustain India’s high growth path, the capital market needs to play a major role. The significance
of a well-functioning domestic capital market has also increased with integration of various economies.
With the increasing importance of capital market in the economy, an attempt is being made to study the
relationship between the secondary market fluctuations and the primary market activities.

2. BACKGROUND AND HYPOTHESIS DEVELOPMENT

The Price Performance of new issues is affected by the secondary market fluctuations. The secondary market
movements provide an overview of the economy and bring a change in IPO activities either directly or indirectly. If
the secondary market does not perform well, the performance of new issues also decelerates and vice versa.
Goetzmann & Jorion (1999) opine that the emerging markets pass through several phases during their emergence and
integration with other markets, thereby leading to a change in the number of IPOs. Ghosh (2005) finds an interesting
result that in Indian market, time lag (duration between offer closing day and the listing day) has a significant
influence on underpricing as the information spread during time lag is not available at the time of offering. Thus, an
attempt is being made to study the effect of Indian secondary market fluctuations on IPO performance.

When the market conditions are favourable, the extent of underpricing is greater providing the average initial return of
26.71% for 143 global shipping firms, whereas if listed during cold period, the average initial return is only 7.75%

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(Merikas, Gounopoulos & Nounis, 2009). Su & Brookfield (2013) highlight that the reforms in China stock market
during 2000 affected the first day returns of IPOs significantly. The China Securities Regulation Commission (CSRC)
prepared to set up a Small and Medium Enterprise (SMEs) Board on the Shenzhen Stock Exchange (SZSE) in 2000
which resulted in the suspension of IPOs on SZSE from 2001 to 2003. The market adjusted excess returns for IPOs in
the pre-reform (January 1995 to March 2001) declined from 129.86% to 117.77% in the post-reform period, (April
2001 to December 2007). Mahmood, et al. (2011) observed that the short run performance of new issues during Asian
financial crisis (1997-98) as well as global economic crisis (2007-09) in China and find a 10% increase in the average
underpricing during global economic crisis.

Chiraphadhanakul & Gunawardana (2005) find that after the new regulations and procedures implemented by SET
(Stock Exchange of Thailand) to control all listed and to be listed companies, the average initial returns are 14.91%
and the volume of IPO increases leading to almost one IPO a week. The after effects of integration of global capital
market are seen in Malaysian primary market. The amount raised by the listed firms is more than US$5,941.01
million during the period of globalisation (1993 to 1996) indicating more than US$26 million of capital is raised per
IPO. Ameer (2012) analysed the effect of macroeconomic variables on IPOs in Malaysia during January 1990 to
December 2008. The study asserts that no IPO had obtained negative returns prior to the Asian financial crisis in
1997, but after the crisis, there has been a noteworthy slowdown in the performance of IPOs. Some of the IPOs during
1997–1998, 2001–2002, 2004–2005 and the middle half of 2008 experienced negative returns on the listing day. The
study also reveals that the new issues had to wait for more than a month for listing during 1991-1996, but this duration
increased to 60 days after the Asian financial crisis. The average duration decreased to 25 days afterwards during
2003-2008. This study is indicative of the fact that crisis had affected performance adversely in terms of returns as
well as volume.

In India, when the returns during Controller of Capital Issues (CCI) period and SEBI period are compared and
findings suggest that the offer during CCI period give highest return of 202% on the listing day, whereas the first day
return during SEBI period is only 80.53% indicating that the IPOs are less underpriced during SEBI period (Madan,
2003). Saha (2012) observes that the IPO market was quite depressed during 1995-96 to 2002-03 due to various
scams in the secondary market. During 1994-95, the capital raised was Rs. 27,633 crores with 1692 issues and it fell
to only 26 issues worth Rs. 4,070 crores in 2002-03. However, the market revived back 2003 onwards. This revived
economy increased the demand of energy sector and private equity IPOs during 2006-07 and 2007-08. During 2007-
08, total 85 IPOs worth Rs. 42,595 crores were floated in the market.

The fluctuations in the market indices also affect the listing day returns of an issue. The performance of market index
assists the company to decide about the timing of the offer (Lee, 2011). It has been found that during hot and cold

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period, the returns differ. Sadaqat, Akhtar & Ali (2011) also support that IPOs provide high market adjusted return of
95.6% during boom in the economy. During the internet bubble period (1999-2000), the extent of underpricing was
highest (Wang & Wilkins, 2007). If stock market indices are in bullish trend then the IPO market will follow the same
trend. Thus, the proposed hypothesis is:

H1: The stock market fluctuations and new issue performance go hand in hand.

3. DATA AND METHODOLOGY

Thus, as examined above, it can be inferred through a vast majority of literature is available regarding the
performance of Indian IPOs, but a few researchers have considered the relationship of primary and secondary market.
The study is conducted on the new issues during 2005-12. The year 2008 is considered as the Recession period as the
statistics regarding the GDP growth provided by World Bank support our assumption.

It has also been found that during 2007 (pre recession), total 91 IPOs were issued whereas in 2009 (post recession),
only 17 IPOs were offered. The research sample includes the book built IPOs listed on NSE during 2005-2012, NSE
being the largest Indian stock exchange in terms of market capitalization & trading volumes; and book building being
the preferred method to decide the price of stock.

Table I: Summary of GDP Growth during 2005-12

S. No Year GDP Growth (%)

1 2005 9.3

2 2006 9.3

3 2007 9.8

4 2008 3.9

5 2009 8.5

6 2010 10.3

7 2011 6.6

8 2012 4.7

(Source: World Bank)

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In total, there are 402 new offerings during 2005-12. Some of them are follow-on-offerings (FPO); few are not listed
on NSE now and for some the data is not available, thus the final sample size is 300 IPOs. The details regarding offer
price, listing price, listing date, market indices etc. have been collected from website viz. http://www.chittorgarh.com,
http://www.nseindia.com, http://www.moneycontrol.com.

The study utilizes market adjusted excess return (MAER) to measure first day returns/underpricing and MAER is
calculated using the following equation (Ritter, 1991; Eyssell & Kummer, 1993; Merikas, Gounopoulos & Nounis, 2009)
MAER= [(P1-P0)/P0 – (M1-M0)/M0]*100

P0: Offer Price

P1: Closing Price on the first day of trading
M0: Closing Value of Market Index on the Offer Closing date
M1: Closing Value of Market Index on the first day of trading
MAER: Market adjusted excess return

4. DATA ANALYSIS

The results as shown through table II indicate that the substantial fluctuation in the secondary market is robust to
primary market activities. When the Nifty index was just 1927.8 points (min. value) during 2005 then only 35 new
issues were offered, it increased to 72 during 2007 when the nifty index reached 6159.3 points (max. value). The
massive increase in the volume of IPO can be attributed to the fact that SEBI made IPO grading mandatory from May
1, 2007 to overcome the problem of information asymmetry. Thus, it can be concluded that change in norms affect the
primary market activities.

Recession hit Indian economy at the end of 2008 as the NSE indicator fell from 6287.85 to 2892.65 and the average
returns of IPOs reduced to 8.21%.

Table II: Year-wise under-pricing of Indian IPOs

Year No. of IPOs Average UP Max. Value of Nifty Min. Value of Nifty
2005 35 38.55% 2835.25 1927.8
2006 54 17.77% 3988.8 2804.55
2007 72 29.52% 6159.3 3843.05
2008 27 8.21% 6287.85 2892.65
2009 19 9.59% 5117.3 2919.9

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2010 55 11.14% 6281.8 4760.4

2011 30 0.44% 6048.25 4747.8
2012 8 3.28% 5908.35 4891.45

Further, during 2009-10 considered as recovery period, Nifty index increased from 2919.9 points to only 6281.8
points and number of issues increased to total of 55. During 2011-12, Inflation affected the Indian market thereby
reducing the NSE indicator to 4747.8 points and the number of issues reduced to only 8.

The results are indicative of the fact that during boom in secondary market (2005-08), the average underpricing varied
from 8.21% to 38.55%, thus the first day returns for the investors are around 40%. But the scenario is quite different
during depressed phase (2009-12) where the returns are as low 0.44% and as high as 11.13%. Thus, H1 is accepted
indicating stock market and new issue activities go hand in hand. The results are consistent with Guner, Onder &
Rhoades (2000) revealing that if the market increases between the offering day and listing day, the first day returns
are positive.

5. CONCLUSION
The study tries to assess the performance of primary market against the fluctuations in the secondary market. The
research tries to analyse the impact of secondary market volatility on listing day returns of IPOs during 2005-12. The
results indicate that during boom in the secondary market and mandatory IPO grading in 2007, the number of offers
increased to 72 in number from 54 in the preceding year. The recession affected the Indian economy in the later 2008
which resulted in the low performance of IPOs as the average listing day returns was 8.21%. During boom in
secondary market (2005-08), the average under-pricing varied from 8.21% to 38.55%, thus the first day returns for the
investors are around 40%. But the scenario is quite different during depressed phase (2009-12) where the returns are
as low as 0.44% and as high as 11.13%.

References

 Ameer, R. (2012). Macroeconomic factors and Initial Public Offerings (IPOs) in Malaysia. Asian Academy of
Management Journal of Accounting and Finance, 8(1), 41-67.
 Chiraphadhanakul, V., & Gunawardana, K. D. (2005). The factors affecting on IPO return in Thai Stock
Market. Proceedings of the International Conference on Computer and Industrial Management. Available at:
http://ijcim.th.org/SpecialEditions/v13nSP2/pdf/p19.1-
6%20The%20Factors%20Affecting%20on%20IPO%20v.2.pdf

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 Eyssell, T. H., & Kummer, D. R. (1993). Signalling, Insider Trading, and Post-Offering Performance: The
Case of Initial Public Offerings. Journal of Applied Business Research, 9(3), 80-92.
 Ghosh, S. (2005). Underpricing of IPOs: The Indian Experience over the Last Decade. Emerging Markets
Finance & Trade, 41(6), 45-57.
 Goetzmann, W. N., & Jorion, P. (1999). Re-emerging markets. Journal of Financial and Quantitative
Analysis, 34, 1–32.
 Guner, N., Onder, Z. and Rhoades, S. D. (2000). Underwriter Reputation and Short-Run IPO Returns: A Re-
evaluation for an Emerging Market. Topics in Middle Eastern and North African Economies, electronic
journal, September (2), Middle East Economic Association and Loyola University Chicago. Available at:
http://www.luc.edu/orgs/meea/.
 Lee, C. (2011). Underwriter Reputation and the decision to go public. Journal of Finance and Accountancy, 6,
108-128.
 Lee, P. J. (2003). Initial Public Offers in a Multiple Issue Framework: The Impact of Subsequent Equity
Issues on Signalling by Underpricing and Retained Ownership. A dissertation submitted in partial fulfilment
of the requirements for the degree of Doctor of Philosophy. Sydney, Australia: The University of Sydney.
 Madan, A. A. (2003). Investments in IPOs in the Indian Capital Market. Bimaquest, 3(1), 24-34.
 Mahmood, F., Xia, X., Ali, M., Usman, M., & Shahid, H. (2011). How Asian and Global Economic crisis
prevail in Chinese IPO and Stock Market Efficiency. International Business Research, 4(2), 226-238.
 Merikas, A., Gounopoulos, D., & Nounis, C. (2009). Global Shipping IPOs Performance. Maritime Policy &
Management: The flagship journal of international shipping and port research, 36(6), 481-505.
 Ritter, J. R. (1991). The long run performance of Initial Public Offerings. Journal of Finance, 46(1), 3-27.
 Ritter, J. R., & Welch, I. (2002). A Review of IPO Activity, Pricing and Allocations. The Journal of Finance,
57(4), 1795-1828.
 Sadaqat, S., Akhtar, M., & Ali, K. (2011). An analysis on the performance of IPO – A Study on the Karachi
Stock Exchange of Pakistan. International Journal of Business and Social Science, 2(6), 277-284.
 Saha, M. (2012). Indian Economy and Growth of Financial Market in the Contemporary Phase of
Globalization Era. International Journal of Developing Societies, 1(1), 1-10.
 Su, C. & Brookfield, D. (2013). An evaluation of the impact of stock market reforms on IPO under-pricing in
China: The certification role of underwriters. International Review of Financial Analysis, 28, 20-33.
 Wang, K., & Wilkins, M. S. (2007). The impact of audit firm industry differentiation on IPO underpricing.
Pacific Accounting Review, 19(2), 153-164.

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FM-103
Financial Issues on Make in India
*Pooja Manchanda
**Hemant Kumar Watts
*Assistant Professor , S.S.D.Girls College , Bathinda
* *Assistant Professor, D.A.V.College, Bathinda
Abstract

The make in India campaign is focussed at that how India can be made manufacturing hub and so
that every investor can work smoothly. Here a dedicated cell is set up so that all the queries of business
entities are answered within 72 hours so that all regulatory processes are monitored and process should be
simplified so that burden of compliance can be reduced. In this way business-friendly environment is set up
so that in India easy approval of projects can be there and there will be hassle free clearance mechanism can
be there. For this purpose unfavourable factors must be removed. India should be ready to give tax
concessions to those companies who come and set up unit in the country. Main focus of India should be to
create novely and innovation for small and medium-sized industries. Govt should give special privileges to
these sectors. Actually India’s make in India campaign will be constantly compared with China’s ‘Made in
China’ campaign. For this India must also encourage high-tech imports, must encourage research and
development (R&D) to give tough competition to the Chinese similar campaigns. For this purpose India
should be prepared and motivated to do world class R&D. Govt should take all the initiative to make this
campaign successful. In this paper all the financial issues related to ‘Make in India’ has been discussed and
how Government is taking all the essential steps to make it successful is also explained.

Key words: tax Concessions, Make in India, financial issues, manufacturing

Introduction

The 15th and current Prime Minister of INDIA “Mr.NarendraModi” unveiled the “MAKE IN INDIA” program on
September 25th 2014 in New Delhi. He along extending an invitation to foreign firms to invest in INDIA also
solicited the CEOs of domestic firms to invest in INDIA by saying that, "There is no need to leave the nation. We
want our companies to shine as MNCs”. The MAKE IN INDIA program laid the foundation of India's new national

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manufacturing policy and rolled out the red carpet to both domestic and international industrialists with an aim to
make India a manufacturing hub that will in turn boost the employment and overall growth of India.

The program lays emphasis on 25 sectors such as automobiles, chemicals, IT, pharmaceuticals, textiles, ports,
aviation, leather, tourism and hospitality, wellness, railways, auto components, design manufacturing, renewable
energy, mining, bio-technology, pharmaceuticals, electronics, etc. with focus on job creation, skill enhancement,
economic, technical as well as overall infrastructure development. It also focuses on giving Indian industry a global
recognition.

Manufacturing industry requires heavy finance to facilitate the buying of latest modern technology, setting up and
development of required infrastructure, developing skill set of its human resource to produce best quality products and
survive in ever increasing global competition. And if INDIA wants to lure the investors and turn itself into a
manufacturing hub, its human resource and financial services will play a vital part in making it’s this dream come
true.

Finance and Human Resource are the most abundant, flexible and readily leveraged resources which demand precise
attention and articulation. According to World Bank Data, in 2013 the contribution of Indian Manufacturing sector to
Indian Economy was merely 13%.

Overall contribution of the manufacturing sector to its GDP is just 28%. India contributed very low in world
manufacturing that is just1.8%. These statistics show that India has not done well in manufacturing sector. Domestic
manufacturers are also looking for markets to setup their manufacturing units outside the Indian borders. Reasons are
many for such an attitude of domestic industrial houses. Fewer subsidies, over interference of government, less
availability of financial services etc. are a few to mention among the reason why the attention of industrial houses is
towards other countries when it comes to setting up an industry. Developing India as a manufacturing hub is not only
required to earn a golden place in the eyes of foreign countries but it is also important because the development of
manufacturing sector in India and Financial issues in Making ‘ Make in India’ successful.

Its transformation into a hub of World Manufacturing Industry will create more jobs and employment opportunities
for its people. Indian brain is immensely intelligent and talented but due to lack of ample and relevant job
opportunities, excellent Indian talent is going abroad and working for companies outside Indian borders. And if India
is converted to a Manufacturing hub and most preferred investment destination for domestic as well as foreign
investors and manufacturers, it will create job opportunities for the immensely talented Indian youth. Transformation
of India into a Manufacturing hub will help develop, strengthen and modernize the Indian infrastructure.

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Such advancement will revive the health of other sectors such as service, agriculture, hospitality, medical, tourism,
etc. In order to achieve this dream, India needs to analyze the importance of its human resource and financial services.
Out of all the other resources, resource from where the finance is generated and the human resource of an organization
are the two most important. Industry cannot be setup if the industrialist does not have the money or finance available
with him as, when and in how much quantity needed.

The country which does not understand the value and importance of its work force and financial services can never
survive. Hence, the effective utilization of the financial services and the human capital of an organization is the secret
of the success of a firm. Both human capital and financial capital move in accordance with each other. Both have the
impact no matter whether positive or negative, but both are directly proportional to each other. Finance has to be
available as and when needed in order to train human resource, procure raw material, setting up infrastructure, making
an organization operative. In order to develop India as a manufacturing hub, match expectations with the
opportunities; the role of financial services and the human resource cannot be overlooked. And if these two major key
factors are ignored, the MAKE IN INDIA will just become a slogan and nothing more.

Rationale of the study

With increasing globalization and rapidly changing dynamic trends, India too needs to develop its infrastructure in
order to militate its presence in the global picture and to match the rising demands and the living standard of its
citizens. The most easy and important way to keep pace with the environment for a country is to develop its
manufacturing sector.

When more global and local players will invest in a country, it will boost the trade and economic growth, develop its
infrastructure, and generate more employment opportunities for its citizens. Mere launch of Prime Minister
Mr.NarinderModi’s “MAKE IN INDIA” campaign is not enough. The success of this campaign would depend upon
potential, availability and skill set of its work force along with the availability of financial services required to propel
the operations and growth of a manufacturing unit. The study focuses attention on various modes of financial services
along with basic target on how country’s work force can be capitalized and enhanced tobring the desired change and
accelerate the desired growth of manufacturing sector in India.

Objectives of the study

 To identify the impact of Financial Services on the development of Manufacturing sector in India and overall
Indian economy.

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 To suggest different techniques and systems through which financial assistance can be provided which is
required to impel the manufacturing industry.
 To emphasize the promotion of assistance of financial services required for boosting the Indian
Manufacturing Sector; which is the main objective of “MAKE IN INDIA” campaign.

Research Methodology

The present research is descriptive and for this research secondary data is taken from various books, journals, Articles
from News papers, Magazines, from various websites which are directly or indirectly related to the present topic of
study.

Limitations of the study

1. The study is based on published data and information.

2. No primary data is being collected.
3. Every care has been taken to use qualitative and correct data; still secondary data have collected for the
purposes other than problem at hand.
4. The objectives, nature and methods used to collect secondary data may not be appropriate to the present
situation.
5. Time constraint remained the major limitation in the study

Need of Financial services

India’s current ranking in the world in factory output is 10. Its overall contribution to Indian GDP is 28% and it
engages nearly 17% of the total work force. The basis of any manufacturing organization is governed by the quantity
of money it is willing to invest and the kind of people who are going to work in it.

For transforming the health of the manufacturing sector and in order to make it a most preferred destination for
domestic as well as foreign investors and industrialists, it is very much important to promote both fund based and non-
fund based financial services. Manufacturing firms to withstand the global competition, and to ensure their long term
sustainability, have to invest in huge quantity in setting up and developing its infrastructure, raw material, skill
development of its human resource, and R&D. Hence, the manufacturing houses need such sources which should
make the finance available as and when needed.

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Such a continuous need of inflow of heavy finance can only be satisfied by the financial services. The attention of the
domestic as well as foreign manufacturers can only be sought if the investment climate is made favourable. As the
investment climate is directly proportional to manufacturers’ way of thinking, hence, this climate needs to be
favourable in every aspect. The current technological status, available mode of finance and human resource skill set
and its availability needs to be identified along highlighting the development initiatives and future imperatives that are
required to make India a manufacturing hub and most preferred investment destination for both local and international
players.

Understanding the Financial Services and its types:

It means services with respect to money management provided by various organizations that is operating in finance
industry of a country.

These organizations include banks, consumer finance and insurance companies, investment funds, stock broker firms
and government sponsored firms.

1. Asset/Fund Based Financial Services the asset or fund based financial services help raising the finance against
the assets including both movable and immovable, bank deposits, etc. It also includes underwriting shares, debentures,
binds, venture capital, factoring, housing finance, leasing, mutual funds etc.

2. Fee Based Financial Services It involves higher expertise and less financial risk. It includes merchant banking,
credit rating, capital restricting, bank guarantee, corporate advisory services, etc.

Different ways to promote financial services:

1. The initiative of government is must in order to reform the investment climate in India which is essential to make
India a manufacturing hub. It should encourage promotion of more and more technological, research and development
parks on the pattern of special economic zones.

2. Foreign manufacturers as well as domestic manufacturers will only be encouraged to invest in India if they will be
provided with an enabling environment. Ensuring timely availability of money, relaxing the norms and regulations
governing the banks in order to make the easier and cheaper credit available to the manufacturing houses

3. Government should Facilitate and encourage merchant banking, factoring, invoice discounting facilities in order to
make the finance readily available.

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4. Promoting and help flourishing the financial service advisors who provide end to end advise as from where will
they finance come from, how much finance is required covering the whole life cycle and production scenario of the
plant in manufacturing industry. These financial advisors also keep track of the inflow and outflow of the money and
the manufacturer does not have to worry about his time management worrying about tracking the movement of
money. They have wide range of funding solutions available in hand which a potential taker can choose from.

5. Encouraging commercial banks to make finance readily available for manufacturing enterprises. Government
should frame such policies which are a bit lenient and relaxed, and thus have an insight to performance and financial
constraints of the manufacturing units.

6. Regulatory environment should be improved in order to pave a way for the development and growth of the
manufacturing industry in India.

7. Government of India should facilitate the promotion of more and more credit card companies and angel investors
which will benefit both the manufacturer and the consumer.

Why Companies were not manufacturing in India ?

When we talk about outsourcing, manufacturing, and service business, China is a major rival to India. India's ailing
infrastructure scenario and defunct logistics facilities make it difficult for the country to achieve an elite status as a
manufacturing hub

The Modi government has decided to remove these obstacles and make the nation an ideal destination for investors to
set up their industries.

The Vision of Make in India The manufacturing industry currently contributes just over 15% to the national GDP.
The aim of this campaign is to grow this to a 25% contribution as seen with other developing nations of Asia. In the
process, the government expects to generate jobs, attract much foreign direct investment, and transform India into a
manufacturing hub preferred around the globe.

The initiative was taken to increase GDP growth and tax revenue and job creation and skill enhancement. The
initiative hopes to attract capital and technological investment in India.

Launched
particulars

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Campaign Name Make In India

Launch Date 09/25/14
Launched By PM Mr. Narendra Modi
Number of Sectors 25 Investment Proposals Received INR 2000 crore
(till 9Oct-2014)

Key sectors allowed making in India

Automobiles, Food processing, Renewable energy, Automobile component, IT and BPM, Roads and Highways,
Aviation, Leather Space, Biotechnology, Media and Entertainment, Textiles and garments, Chemicals, Mining,
Thermal Power, Construction, Oil and Gas, Tourism and Hospitality, electrical, Machinery, Ports, Electronic systems,
railways.

Recommendations and suggestions on the basis of Prime Minister’s speech

1. Any of company or enterprise should not leave India due to business constraints.
2. FDI is a responsibility for the people and an opportunity for the global investors; FDI for Indians should be
“First Develop India” and Foreign Direct Investment for the investors only when India moves away from
poverty will purchasing power in the country increase and when this happens the country will start to bloom
as a grand huge market for industries.
3. The movement away from poverty will come from increase in employment; employment will come only
when we start developing the manufacturing sector in India.
4. Investors are not attracted by incentives. ; investment will be attracted only by friendly policies and a secure
environment Ease of business is important for development
5. India has slipped low in the list of countries in terms of ease of doing business Scrutiny and red tape should
not create barriers for development;
6. The world should invest in Asia
7. The government needs to reassure investors of its effectiveness in promoting business and industry Skilled
manpower mapped to the natural potential and creation of sustainable growth will be the focus of ‘Make in
India’ Private-public partnership must be the basis of skills development in the country.
8. It is the government’s responsibility to facilitate the creation of an environment conducive to development
65% population of the country is less than 35 years of age – there is immense manpower.
9. There are numerous opportunities in manufacturing and to develop this sector we will require a whole new
world of infrastructure i.e. gas, water pipelines, ports, and a lot many more

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10. The ‘Make in India’ campaign is dedicated to Pandit Deendayal Upadhyaya, the patriotic thinker and
philosopher

Conclusion:

Favourable industrial framework need to be established that should attract more and more domestic as well as foreign
industrialists towards Indian Territory. There is a need for financial service providers and advisors who could work
for these industrialists right from the beginning i.e. right from clearance of the project.

Improved quality and better performance management system needs to be in place to guide, monitor and enhance the
skill set of its work force. Mind set of Industrialists both foreign and domestic towards India needs to be changed. On
the basis of the study it can rightfully concluded that People and money, both are the organization’s greatest
competitive edge. It is essential to unlock the human talent for the success and sustainability of any organization.

The development, prosperity and sustainability of India as a Manufacturing hub clearly depend upon the immense
potential of its human resources and the financial services that are available for the domestic and foreign players.
Employees possessing high value and unique intellectual skills significantly contribute to generate intellectual
products. If India successfully provides the industrial houses all this then it will certainly become a world
manufacturing hub. This study both empirically and rationally explained the patterns through which India can become
a manufacturing hub. Favourable investment climate, assistance of financial services, relax and industry favourable
government policies are the essential ingredients of “MAKE IN INDIA”

References

Dr. M. Kabir Hassan, the impact of globalization on the developing countries, Journal of Economic
Cooperation among Islamic Countries, 19, 1-2 (1998) 71-135 [18]

Indian Entrepreneurs in Import Substitution – Need of the Hour for Indian Economy, Mrs.KamnaDhawan,
AISECT University Journal Vol. II/Issue IV Sep. 2013. ISSN: 2278-4187. [19]

R. Bhattacharyya, (2012). The Opportunities and Challenges of FDI in Retail in India, IOSR Journal of
Humanities and Social Science, 5(5), pp. 99 – 109 [20]

Skill development for the youth-A Global Quest, SiddharthChatturvedhi, AISECT University Journal Vol.
II/Issue IV Sep. 2013. ISSN: 2278-4187

http://www.business-standard.com/article/economy-policy/there-are-some-questions-on-execution-of-make-
in-india-on-the-ground-doug-gates-115101400015

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FM-104
IMPACT OF MERGERS AND ACQUISITIONS ON INDIAN BUSINESS
*RAMANJOT KAUR **Dr. KUSUM GUPTA
*[email protected], Research Scholar, School of management studies ,Punjabi University, Patiala.

** [email protected], D.A.V. College, Bathinda.

Abstract:-
Mergers and Acquisitions are transitions in which the ownership of companies, other business organizations or their
operating units are transferred or combined. As an aspect of Strategic Management, M&A can allow enterprises to
grow, shrink, change the nature of their business or improve their competitive position. From a legal point of view a
merger is a legal consolidation of two entities into one entity, where as an acquisition occurs when one entity takes
ownership of another entity’s stock, equity interests or assets. From a commercial and economic point of view, both
types of transitions generally result in the consolidation of assets and liabilities under one entity, and the distinction
between a merger and an acquisition is less clear. A transaction legally structured as a merger may have the effect of
placing one part’s business under the indirect ownership of the other party’s shareholders, while a transition legally
structured as an acquisition may give each party’s shareholders partial ownership and control of the combined
enterprise. A deal may be called a mergers of equals if both CEO’s agree that joining together is in the best interest of
both of their companies. While when the deal is unfriendly that is when the management of the target company
opposes the deal it may be regarded as an acquisition.

Keywords: - mergers & acquisition, assets & liabilities, shareholder, strategies, competition.

Introduction:-
The practice of Mergers and acquisitions has attained considerable significance in the contemporary corporate
scenario which is broadly used for reorganizing the business entities. Indian industries were exposed to plethora of
challenges both nationally and internationally, since the introduction of Indian economic reform in 1991. The cut-
throat competition in international market compelled the Indian firms to opt for mergers and acquisitions strategies,
making it a vital premeditated option.

To end up the word merger may be taken as an abbreviation which means:-

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M means mixing means Entities, R means resources for, G means growth, E means enrichment and R means
renovation.

Why Mergers and Acquisitions in India?

The factors responsible for making the merger and acquisition deals favorable in India are:

 Dynamic government policies

 Corporate investments in industry
 Economic stability
 “ready to experiment” attitude of Indian industrialists

Sectors like pharmaceuticals, IT, ITES, telecommunications, steel, construction, etc, have proved their worth in the
international scenario and the rising participation of Indian firms in signing M&A deals has further triggered the
acquisition activities in India. In spite of the massive downturn in 2009, the future of M&A deals in India looks
promising. Indian telecom major Bharti Airtel is all set to merge with its South African counterpart MTN, with a deal
worth USD 23 billion. According to the agreement Bharti Airtel would obtain 49% of stake in MTN and the South
African telecom major would acquire 36% of stake in Bharti Airtel.

Ten biggest Mergers and Acquisitions deals in India

 Tata Steel acquired 100% stake in Corus Group on January 30, 2007. It was an all cash deal which
cumulatively amounted to $12.2 billion.

 Vodafone purchased administering interest of 67% owned by Hutch-Essar for a total worth of $11.1 billion on
February 11, 2007.

 India Aluminium and copper giant Hindalco Industries purchased Canada-based firm Novelis Inc in February
2007. The total worth of the deal was $6-billion.

 Indian pharma industry registered its first biggest in 2008 M&A deal through the acquisition of Japanese
pharmaceutical company Daiichi Sankyo by Indian major Ranbaxy for $4.5 billion.

 The Oil and Natural Gas Corp purchased Imperial Energy Plc in January 2009. The deal amounted to $2.8
billion and was considered as one of the biggest takeovers after 96.8% of London based companies'
shareholders acknowledged the buyout proposal.

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 In November 2008 NTT DoCoMo, the Japan based telecom firm acquired 26% stake in Tata Teleservices for
USD 2.7 billion.

 India's financial industry saw the merging of two prominent banks - HDFC Bank and Centurion Bank of
Punjab. The deal took place in February 2008 for $2.4 billion.

 Tata Motors acquired Jaguar and Land Rover brands from Ford Motor in March 2008. The deal amounted to
$2.3 billion.

 2009 saw the acquisition Asarco LLC by Sterlite Industries Ltd's for $1.8 billion making it ninth biggest-ever
M&A agreement involving an Indian company.

 In May 2007, Suzlon Energy obtained the Germany-based wind turbine producer Repower. The 10th largest
in India, the M&A deal amounted to $1.7 billion.

Mergers and acquisitions in the corporate world refer to the process of buying, selling or combining of different
corporations to achieve rapid growth. In case of merger, two companies, often of same size, decide to go ahead as a
single unit (new company) instead of operating separately. While, on the other hand, in case of acquisition, one
organization takes over another to establish itself as the new owner of the business. Corporate mergers and
acquisitions play pivotal role in the business and economy of any country. These result in significant restructuring of
the industry and contribute substantially to the growth of the industry and economy of the country as well.

Importance of Corporate Mergers and Acquisitions

Corporate mergers and acquisitions have a great impact on the industry and economy of any country. These events
restructure the industry and influence the country's economy as a whole. Corporate mergers and acquisitions also
increase the market competition and also work as ‘engines of growth’. Corporate mergers and acquisitions involve
skill transfer and other sharing activities. Besides, these also result in increase in production, which again lead to rapid
growth of the corporation.

Types of Corporate Mergers

Corporate mergers can be of the following types:-

 Horizontal Merger: - In horizontal merger, the two companies are direct competitors who represent the same
market and also sell the same products/services.

 Conglomeration Merger: - In this type of merger, the participating companies do not represent the same
industry.

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 Product-Extension Merger: - In product-extension merger, the participating companies sell different

products of related category.

 Market-Extension Merger: - Here participating companies sell same products in different markets.

Why Corporate Mergers and Acquisitions?

There are several reasons why corporates go for mergers and acquisitions. The main goal is to increase the business
and market share as well as to improve the financial performance of the corporation. Following are some of the
reasons why corporates go for mergers and acquisitions.

 Through corporate mergers and acquisitions, duplicate departments can be eliminated in the combined
company, which would help to reduce its fixed costs. As a result, the profit margins would go up.

 It helps the organization to increase revenue and market share.

 Cross-selling of products/services is possible.

 A profitable corporation also buys a loss-making company in order to use the ‘losses’ of the target company
to lessen its tax liability.

 Mergers and acquisitions also let the companies to transfer resources. By this way, one company may use the
specialized skills of the others.

 Companies also go for mergers/acquisitions for vertical integration, where the vertically integrated company
can gather one deadweight loss by setting the output of the upstream company to the competitive level.

Steps of Mergers and Acquisition Process

The process of merger and acquisition has the following steps:-

Market Valuation: - Before you go for any merger and acquisition, it is of utmost important that you must know the
present market value of the organization as well as its estimated future financial performance. The information about
organization, its history, products/services, facilities and ownerships are reviewed. Sales organization and marketing
approaches are also taken into consideration.

Exit Planning: - The decision to sell business largely depends upon the future plan of the organization – what does it
target to achieve and how is it going to handle the wealth etc. Various issues like estate planning, continuing business
involvement, debt resolution etc. as well as tax issues and business issues are considered before making exit planning.
The structure of the deal largely depends upon the available options. The form of compensation (such as cash, secured
notes, stock, convertible bonds, royalties, future earnings share, consulting agreements, or buy back opportunities etc.)
also plays a major role here in determining the exit planning.

Structured Marketing Process:-

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This is merger and acquisition process involves marketing of the business entity. While doing the marketing, selling
price is never divulged to the potential buyers. Serious buyers are also identified and then encouraged during the
process. Following are the features of this phase.

 Seller agrees on the disseminated materials in advance. Buyer also needs to sign a Non-Disclosure agreement.
 Seller also presents Memorandum and Profiles, which factually showcases the business.
 Database of prospective buyers are searched.
 Assessment and screening of buyers are done.
 Special focuses are given on he personal needs of the seller during structuring of deals.
 Final letter of intent is developed after a phase of negotiation.

Buyer Due Diligence:- This is the phase in the merger and acquisition process where seller makes its business
process open for the buyer, so that it can make an in-depth investigation on the business as well as its attorneys,
bankers, accountants, tad advisors etc.

Definitive Purchase Agreement: - Finally Definitive Purchase Agreement are made, which states the transaction
details including regulatory approvals, financing sources and other conditions of sale.

Possible Impact of Mergers and Acquisitions

Have a look at the impact of Mergers and Acquisitions on different segments of business.

 Impacts on Employees: -Mergers and acquisitions may have great economic impact on the employees of the
organization. In fact, mergers and acquisitions could be pretty difficult for the employees as there could
always be the possibility of layoffs after any merger or acquisition. If the merged company is pretty sufficient
in terms of business capabilities, it doesn't need the same amount of employees that it previously had to do the
same amount of business. As a result, layoffs are quite inevitable. Besides, those who are working would also
see some changes in the corporate culture. Due to the changes in the operating environment and business
procedures, employees may also suffer from emotional and physical problems.

 Impact on Management: -The percentage of job loss may be higher in the management level than the
general employees. The reason behind this is the corporate culture clash. Due to change in corporate
culture of the organization, many managerial level professionals, on behalf of their superiors, need to
implement the corporate policies that they might not agree with. It involves high level of stress.

 Impact on Shareholders: -Impact of mergers and acquisitions also include some economic impact on the
shareholders. If it is a purchase, the shareholders of the acquired company get highly benefited from the
acquisition as the acquiring company pays a hefty amount for the acquisition. On the other hand, the
shareholders of the acquiring company suffer some losses after the acquisition due to the acquisition premium
and augmented debt load.

 Impact on Competition: -Mergers and acquisitions have different impact as far as market competitions are
concerned. Different industry has different level of competitions after the mergers and acquisitions. For
example, the competition in the financial services industry is relatively constant. On the other hand, change of
powers can also be observed among the market players.

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REVIEW OF LITERATURE:-
Ehsan et al. (2005)29, in their study “Performance Measurement in Corporate Governance: Do Mergers Improve
Managerial Performance in the Post-Merger Period?” assessed the effect of M&Asactivity on the performanceof USA
firms. The study sample of 45 pairs of merged firms, over a period offive years pre-and post-merger, were tested. The
study used data envelopmentanalysis (DEA) to determine the managerial efficiency impact of the merger
bycomparing the combined efficiency of the acquired and the acquiring firm priorto the merger with the efficiency of
the merged firm during the post-mergerperiod. The study findings indicated that the managerial efficiency of a
majority(82%) of sample firms had improved in the post-merger period.

Pazarskis Collins et al. (2006)30, in a study entitled “Exploring the Improvement of Corporate Performance after
Mergers – The Case of Greece” examined, empirically, the impact of M&As on the OP of M&As–involved firmsin
Greece. The study used financial and non-financial characteristics, and thepost-merger performance of 50 Greek
firms, listed at the Athens Stock Exchangethat executed at least one merger or acquisition from 1998 to 2002.
Selectedaccounting variables (financial characteristics) were used to measure OP andcompare pre-and post-merger
firm performance for three years before M&As andthree years after M&As. The results were then evaluated on the
basis of certainnon-financial characteristics (type of merger, method of evaluation and payment),and financial
characteristics (a set of seven selected financial ratios). The mainfinding of the study was that there was strong
evidence that the profitability of afirm that performed an M&Asdecreased due to the M&As event.

Gantumur and Stephan (2007)32, in a study “Merger, Acquisitions and Innovation Performance in the
Telecommunications Equipment Industry” analyzed the innovation determinants of M&As activity, and the
consequencesof M&As transactions on the technological potential and the innovationperformance. The study
examined the telecommunications equipment industryover the period 1988 – 2002 using 638 newly created data sets
with firm-leveldata describing M&As and innovation activity, as well as financial characteristics.Based on a matching
propensity score procedure, the study provided evidences
That M&Asrealize significantly positive changes to the firm’s post-merger innovation performance. The study
delivered insights into the desirability of M&Asfor the innovation performance of firms by analyzing the M&As that
took place in the international telecommunications equipment industry from the late 1980s until the early 2000s. The
study concluded that, on an average, M&Asrealize significantly positive changes to the innovation performance of
firms following M&As. The post-merger changes are driven by both the
Success in R&D activity and the weakness in internal technological capabilities
At acquiring firms prior to a merger.

Lau et al. (2008)35, in a work entitled “Accounting Measures of Operating Performance Outcomes for Australian
Mergers” examined the OP of mergedfirms, compared to the performance of the pre-merger targets and
acquirers,with a sample of 72 Australian mergers during 1999 – 2004. Performancemeasures used in the study were
profitability, cash flow, efficiency, leverage, and growth. Such measures were used to proxy for the success of the
M&As, which is defined in terms of an improvement in each merged firm’s industry
Adjusted OP between the pre-and post-merger period. The study provided some
Evidence that M&Asimproved post-merger OP.

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OBJECTIVE OF THE STUDY:-

 To examine the impact of M&As on performance of corporate enterprise.

METHODOLOGY:-
Valuation Models in Mergers and Acquisitions.

There are a number of methods used in mergers and acquisition valuations. Some of those can be listed as:
 Replacement Cost Method: - In Replacement Cost Method, cost of replacing the target company is
calculated and acquisitions are based on that. Here the value of all the equipments and staffing costs are
taken into consideration. The acquiring company offers to buy all these from the target company at the
given cost. Replacement cost method isn't applicable to service industry, where key assets (people and
ideas) are hard to value.

 Discounted Cash Flow (DCF):- Method Discounted Cash Flow (DCF) method is one of the major
valuation tools in mergers and acquisitions. It calculates the current value of the organization according to
the estimated future cash flows. Estimated Cash Flow = Net Income + Depreciation/Amortization - Capital
Expenditures - Change in Working Capital These estimated cash flows are discounted to a present value.

 Weighted Average Costs of Capital (WACC):- This is used for the calculation. DCF
Method is one of the strongest methods of valuation.

 Economic Profit Model:- In this model, the value of the organization is calculated by summing up the
amount of capital invested and a premium equal to the current value of the value created every year moving
forward.
Economic Profit = Invested Capital x (Return on Invested Capital - Weighted Average Cost of Capital)
Economic Profit = Net Operating Profit Less Adjusted Taxes - (Invested Capital x Weighted Average
Cost of Capital)
Value = Invested Capital + Current Value of Estimated Economic Profit

 Price-Earnings Ratios (P/E Ratio):- This is one of the comparative methods adopted by the acquiring
companies, based on which they put forward their offers. Here, acquiring company offers multiple of the
target company's earnings.

 Enterprise-Value-to-Sales Ratio (EV/Sales):- Here, acquiring company offers multiple of the revenues.
It also keeps a tab on the price-to-sales ration of other companies.

RESULTS:-
There is a positive impact of mergers and acquisitions on Indian business by the way of higher growth in economy of
scale, economy of scope. There is positive impact to increase the wealth of shareholders of the two merged
companies. By doing the mergers and acquisitions there is positive source of synergy by doing the business for better

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performance and growth. By doing the mergers and acquisitions in Indian companies leads to more globalization in
Indian industry.

CONCLUSION:-
Mergers and acquisitions strategies are extremely important on Indian business. In order to drive the maximum benefit
out of a merger or acquisition deal. It is quite difficult to decide on the strategies of mergers and acquisitions
especially for those companies who are going to make a merger or acquisition deal for first time. The Impact of
mergers and acquisitions is in the right way to do the business in the Indian economy. This provides the business
opportunities to expand the business in globalization scenario.

References:-

1. Agrawal, A., Jaffe, J. F. & Mandelker, G. N.: “The Post-Merger Performance of Acquiring Firms: a Re-
examination of an Anomaly.” The Journal of Finance, 47(4), 1992, pp-1605-1621.
2. Andrade, Gregor, Mark, Mitchell and Erick Stafford :“New Evidence and Perspectives on Mergers”
Journal of Economic Perspective, 15[2], spring, 2001, pp103-120.
3. Annonymous: “The Raider‟ s Road Map” Business India, May 7-21,1995, pp-66.
4. Annonymous: “Mega Money Mergers”, Business Today, Dec-7-21, 1996, p-84.
5. Augustine , Babudas :“ A Growing Case for Takeovers.”, Business World, I Nov. 1995, pp 64-66.
6. Barney J.B.: “Returns to Bidding Firms in Mergers and Acquisitions: Reconsidering The Relatedness
Hypothesis”. Strategic Management Journal, 9 (Special Issue): 1988.pp 71-78.
7. Baldwin, J.R. acnd P.K. Gorecki.: “Mergers and Merger Policy in the Canadian Manufacturing Sector:
1971-1979” Working Paper No. 297, Economic Council of Canada, Ottawa, 1986
8. Basant Rakesh.:“Corporate Response to Economic Reforms” Economic and Political Weekly, Mar4,
2000.
9. Beena, P. L. :“Mergers and Amalgamations: an Analysis in the Changing Structure of the Indian
Oligopoly”. Unpublished Ph.d. Thesis submitted to JNU, New Delhi, 1998.
10. Bharadwaj Neera. : “Mid Merger Blues”, Business India, 18 Nov, 1996.pp-74.
11. Buono, A.F. :"Seam-less Post-merger Integration Strategies: A Cause for Concern", Journal of
Organizational Change Management, Vol. 16 No.1, 2003, pp.90-8.
12. Cannella, A. A. Jr. & Hambrick, D. C. :“Effects of Executive Departures on the Performance of
Acquired Firms”. Strategic Management Journal, 14, 1993, pp 137-152.
13. Caves, R.E.: “Mergers, Takeovers and Economic Efficiency: Foresight vs. Hindsight,” International
Journal of Industrial Organization 7, 1989, pp. 151-174.
14. CMIE: Economic Intelligence Service, Monthly Review of the Indian Economy, various Issues, CMIE,
Mumbai.
FM-105

CORPORATE DEBT RESTRUCTURING – A TOOL FOR DEBT MANAGEMENT

(A Case of Wockhardt and Arvind Mills)

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*Pritpal Singh Bhullar

* Assistant Professor, Giani Zail Singh Campus College of Engineering & Technology Bathinda
* E-mail – [email protected]
*Contact – 8968890006
*Mr Ajay Deep Singh Brar
*Research Scholar, Punjabi University Patiala
*Email- [email protected]
*Contact - 9888162003

ABSTRACT

Sustainable cash flow for firm is essential to distinctively synergize the business in the VUCA (Volatile, Uncertain,

Complex and Ambiguous) world. Corporate need funds for impactful alignment of various business operations to

cultivate benefits efficiently. Funds raised through debt have been considered as cheaper option by the business

houses as it does not dilute the ownership in firms. Sometime firms indulge so deeply into debt that it becomes a

challenge for them to come out from debt. Corporate Debt Restructuring (CDR) has been emerged as an important

tool for debt management in current scenario. Wockhardt, an Indian pharmaceutical and bio technology firm, faced

financial crisis during 2008 to 2010 as the company defaulted on the FCCBs that matured in October 2009 and also

took some wrong acquisition decisions. To revive its business company adopted Corporate Debt Restructuring (CDR)

route. Arvind Mills also implemented CDR successfully to rejuvenate its business. Arvind Mills and Wockhardt set an

example of implementing CDR successfully to defend their businesses during financial distress times and transform

into top profitable ventures of country.

Key Words – Debt Management, Corporate Debt Restructuring (CDR), Wockhardt financial crisis, CDR strategy

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INTRODUCTION

“Debt is like any other trap, easy enough to get into, but hard enough to get out of.”

Henry Wheeler Shaw

In the current era of economic liberalization, firms operate in a very sensitive business environment amidst the ever

increasing competition. Cash flow of firm does not remain the same in this fragile business environment. Sustainable

cash flow of firm has become very sensitive issue in current scenario. Influential global events also affect the

profitability of business. Firms take huge debt for expanding their existing business, start up new ventures, developing

new products and for many business strategies like mergers and acquisition. Funds raised through debt have been

considered as cheaper option as it does not dilute the ownership in firms. Sometime firms involve so deeply into debt

that it become tough for them to take a breath in debt free environment. It becomes a challenge for them to come out

from debt. At this point, debt management takes a serious thought. Huge debt also shackles the belief of investors. It

also hit adversely to the goodwill and market value of firm. In such an environment, Corporate Debt Restructuring

(CDR) has been emerged as a tool for debt management. CDR has been used when companies are not able to repay its

future liabilities. The importance of CDR has been realized the most after the 2008 global melt down.

CORPORATE DEBT RESTRUCTURING

Slow economic growth, negative influence of global events, rupee depreciation hit the cash generated capabilities of

companies that further affect adversely to the potential of repayment of debt by companies. In order to prevent

bankruptcy of companies or turning their loan amount into non performing assets (NPAs), banks and other lenders

restructure the debt amount. Firms adopt CDR route under following conditions –

a) When fixed asset finance by debt increase beyond desired limits in company balance sheet

b) When Return on Capital Employed (ROCE) of firms decrease

c) When financial fragility of business increase

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Under CDR mechanism, debt has been restructured by the banks and financial institutions for providing timely

financial support to those companies which are facing financial crisis because of the systematic risk factors internally

and externally. Some of the following facilities have been provided to companies for the repayment of their debt.

a) Firms may get concession in interest rates

b) Time period for loan repayment may be rescheduled

c) Debt may be converted into equities or preference shares

Debt restructuring is based on mainly two pillars – Revenue and Cost. It has become a big challenge for the firms to

increase their revenue and reduce their input cost. Firms try to launch their new products at low cost and price to gain

market share. Some of the main strategies that firms adopt to rejuvenate their business while adopting CDR route are

a) Diversification of business portfolio

b) Closure of non - profit and high overhead business unit of firm

c) Refocus on core business of firm

d) Exploring new markets for business

e) Focus on cost reduction by upgrading new technology

CDR SCENARIO IN INDIA

Reserve Bank of India (RBI) set up CDR system in 2001 to aid financial distress corporate. It has been represented by

banks and financial institutions. CDR not only acts as tool for managing the debt of companies but it also acts as

safeguards of interest of lenders (Banks and Financial institutes) through restructuring of debt of borrowers. In India

CDR structure is based upon three tier structure

a) CDR Cell – The CDR cell scrutinize the proposal received for restructuring. Once the proposal gets approval

then it sketch out the detailed plan with the help of lenders.

b) Empowered group – On the basis of the report prepared by CDR cell, the Empowered group takes the

decision about restructuring of debt or not. If Empowered group give it node, initial guidelines have been

provided.

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c) Standing form – Standing form is the top tier in CDR mechanism. It comprises of representatives of all the

financial institutions & banks. This body lays down the policies & guidelines to be followed by the EG &

CDR cell for debt restructuring.

The popularity of CDR has been increasing among Indian companies since 2008 after the collapse of Lehman

Brothers Holding Inc. The following table shows the statistics of increasing the trend of CDR in Indian corporate

houses.

Table 1 - Growing popularity of CDR in India

Total Aggregate Percentage Increase in
No. of Approved
Year Debt Approved Cases
Cases
(In Crores) (%)
Mar-09 184 86,536

Mar-10 215 1,04,299 16.85

Mar-11 242 1,10,914 12.56

Mar-12 292 1,50,515 20.66

Mar-13 401 2,29,013 37.33

Source - http://www.cdrindia.org/statistical.html

As per CDR performance report in India, most of the corporate debt restructuring belongs to 5 major sectors. More

than 60% of cases of CDR come from these 5 sectors.

Table2 – Top 5 Indian industries of CDR live cases till 30th September 2013

S. No. Industry No. of Live Cases Aggregate Debt Debt (%)

1 Iron & Steel 46 41812 21.3

2 Infrastructure 20 35543 18.11
3 Textiles 47 19545 9.96
4 Power 13 17225 8.78
5 Telecom 5 9808 5.00
Source – http://www.cdrindia.org/downloads/CDR%20Performance%20upto%20September%20%202013.pdf

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INTRODUCTION TO WOCKHARDT

Wockhardt is research based Global Pharmaceutical and Bio technology Indian firm, founded by Mr. Habil

Khokriwala in 1967. Wockhardt deals in products like injectables, Bio-Pharmaceuticals, Orals (Tablets and Liquids)

and Topicals (Creams and Tablets). It has widespread its business in emerging economies of world like Sri Lanka,

Brazil, Russia, Vietnam, Myanmar and in African Countries like Ghana, Kenya etc through marketing of its high

quality products. Cardiac drug Enalapril maleate had been launched in US with Sidmak Laboratories in Year 2000. In

year 2003, field organization has been restructured for up gradation of productivity and level of competition. For

manufacturing and marketing of neurology drug Methylcobal, Wockhardt entered in strategic alliance with Japanese

firm Eisai Company Ltd. CP Pharmaceuticals (Holdings) ltd. has been acquired. An acquisition of German based

pharmaceutical company Espharma GmbH had been completed for Rs 49 Crores in year 2004. An in – license pact

had been signed with UK based health care company Crawford in 2007. Wockhardt launched Cetrizine in US.

ANDA had been received for marketing of 5mg and 10 mg Cetrizine tablets. In January 2012, USFDA gave its final

approval nod for selling of nasal spray of Fluticasone used for treatment of allergic rhinitis.

REASONS OF FINANCIL CRISIS IN COMPANY

The company had debt of around Rs 3,000 crore on its books. Company raised money through a sale of FCCBs worth

$110 million (around Rs 605 crore today) in 2004. The money was raised mainly from Indian banks and foreign

investors for funding three foreign acquisitions starting in 2005.

Default on FCCB – 2008 financial crisis hit investments of company. Wockhardt defaulted on the FCCBs that

matured in October 2009. Lenders panicked and even demanded liquidation of Wockhardt’s business to recover their

dues. The promoters had pledged some of their key assets, including the company’s corporate headquarters in

Mumbai’s premier Bandra-Kurla business complex and a key portion of their stake in Wockhardt to raise money for

the group’s privately held hospital business, which was in an expansion phase.

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Wrong Acquisition in France – Wockhardt acquired French company Negma for Rs 1,083 crore. Soon after

acquisition, Negma’s patents on some key products were expired. The contribution of these products was around 70%

of its revenue and its revenue decreased from euro 106 million to euro 34 million. Company has brought down its

headcount in France from 497 to 63.

IMPLEMENTATION OF CDR

Wockhardt is the best example of successful implementation of CDR in India. Company was successful in settle down

all its liabilities before the expected time.

Corporate Debt Restructuring (CDR)- CDR is a financial restructuring process for troubled companies,

which eases conditions on debt repayments but also limits the powers of the management to take operational and

strategic decisions. Wockhardt approached CDR cell through lead banker ICICI Bank Ltd. The Empowered Group

allowed for most of its `3,800 crore debt to be recast, and was to last until March 2018. Under the CDR plan, the

interest rate was capped at around 10%. Creditors also agreed to convert a portion of derivative liabilities into

preference shares which will be redeemed in 2018. The repayment of a $250 million loan to the company’s European

business was extended and can be paid between 2013 and 2015.

Some main features of CDR plan were following -

1. The existing loan will continue at a concessional rate of interest of 10% per annum. It had 2 parts- 8% and

2%. 8% per annum will be paid on monthly basis where as 2% per annum shall be converted in to preferences

share capital redeemable in 2018.

2. Management has committed to sale/divestment of its non core business over a period of 2009 to 2015.

Foreign Currency Convertible Bondholders (FCCB) and Wockhardt EU European (Swiss) AG (EU) loan will

also be restructured.

3. The existing rupee term loan will be paid in to 24 quarterly installments commencing from July 15, 2010.

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After entering into CDR process, company adopted following debt restructure plan to give new blood to their business

1.Demerger

Wockhardt adopt Demerger policy under which it sold its non core business to other players of respective business

and used the revenue earned through demerger in repay its loan amounts. Company sold its following businesses

under demerger phase

Table 3 – Demergers of Wockhardt business

Name of Company Acquirer Year Amount

Esparma Mova GmbH (Germany) June 2009 Rs 120 Crore

Animal Health Care Business Vétoquinol SA (France) August 2010 Rs 170 Crore

Nutrition Business Danone ( France) July 2012 Rs 1280 Crore

10 Wockhardt Hospitals Fortis Healthcare (India) August 2009 Rs 909 Crore

Source – Annual reports of Wockhardt

1. Manufacturing Efficiencies

Company gave emphasize on cost optimization rather than Cost control. The key factor of improving financial

performance of company is to create manufacturing efficiencies. Manufacturing volume in India increased by 22%.

Manufacturing cost has been reduced through improved automation and better inventory control. Energy consumption

decreased by 10% as compared to last year. Manufacturing processes like Quality by design, Design of experiment

and other statistical tools used to evaluate and mitigate risks.

2. Sales and Distribution Strategies

Company increased sales of its products through partnering with established players in Russia, Brazil and Mexico

who have existing sales and marketing capabilities sell products in these countries. Company also entered in Strategic

alliance with Sheffield bio science for distribution of recombinant Insulin in cell culture

Current Scenario

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Company has 11 manufacturing plants in world. Out of which 9 plants are in India, 1 is in UK and 1 plant is in

Ireland. Today company is third largest player in UK’s generic market and second rank in hospital market. In Ireland,

Wockhardt is the largest generic company. 70% of Europe revenue comes from UK. In future, UK business is

expected to grow at 10-15 %. Company has 919 products in market.

Graph 1 – Geographical revenue contribution in Wockhardt

INTRODCUTION TO ARVIND MILLS

Arvind Mills started its operations in 1931. It is the largest cotton textile manufacturer and exporter in India and a

leading player of branded garments in domestic market. The principal business of company consists of manufacturing

and marketing of Denim fabric, Shirting fabric, Shirts, Knitted fabric and garments.

FINANCIAL CRISIS IN ARVIND MILLS

In early 2000, company started to lose around Rs 1 crore every day. Denim business of company continued to crash.

In 2000, Arvind Mills owed around Rs 2700 crore loan out of which Rs 900 crore owed to foreign lenders and Rs

1800 crore was owed to Indian lenders.. Company defaulted to repay the interest payments on its loan. In 2000,

company touched its life time low share price of Rs 9. In 2000, company reported a loss of Rs 300 crore against a

profit of

Rs 0.1400 crore. In October 2000, CRISIL downgraded stocks of Arvind Mills to “default”

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REASONS OF FINANCIAL CRISIS

Following are some of the main reasons behind the financial crisis in Arvind Mills

a) Firm adopted expansion plan based on debt in 1997

b) Shift in fashion

c) Domestic and Global overcapacity of Denim

d) Depreciation of Rupee

e) Sharp drop in global denim price

CDR IMPLEMENTATION IN ARVIND MILLS

Arvind mills restructured their debt of around Rs 27,000 billion. 43 out of 54 lenders including overseas

lenders approved its debt restructuring plan. As per corporate debt restructure plan, 40% of the debt was

written off whereas repayment of remaining 60% debt was staggered with lesser interest rate. Some of

banks (lenders) gave their approval to the buyback at a 55% discount on the principal amount whereas some

lenders agreed to a five year rollover for which they would be entitled to interest plus the principal. Some

banks also agreed to a ten year rollover for which they would be paid a higher rate of interest plus principal.

The debt revamp reduced Arvind Mills’ interest burden by 50%. Under debt buyback Arvind mills bought

550 crore in debt and all overdue interest waived off.

STRATEGIES UNDER CDR PLAN

Debt restructuring plan of Arvind Mills was based upon the following strategies –

a) Company adopted new age fabrics

b) Adopted new dying and processing method

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c) Outsource non – core business processes

d) Optimizing the operations in Shirting fabric business

e) Focus on high value added garment business like Knitting and Shirts

OUTCOMES OF CDR

Arvind Mills earn EBIDTA of Rs 418 crore in FY 2002-03. Operating margin improved from 20% to 28%. In year

2002-03 company posted a net profit of Rs 129 crore s compared to 20.26 crore in FY 2001-02.

LESSONS TO BE LEARNT

Wockhardt and Arvind Mills set an example for the corporate world of implementing successfully various strategies

to defend the company during financial distress times and transform it into top 10 profitable ventures of country.

Even under such financial distress, Wockhardt and Arvind Mills did not reduce its R&D expenditure and continue to

focus on innovation which paid the company successfully later on. Innovative use of latest technologies in

manufacturing, Successful implementation of financial engineering techniques (CDR), better strategic alliances across

the globe for sales and distribution injected the new blood in the company. Some other companies like India Cement,

Essar Oil also implemented CDR as a successful strategy and turns into profitable business. If implemented

strategically, CDR is also a very effective debt management tool for banks and financial institutions as it avoid their

lending money to turn into NPAs.

REFERENCES

D’silva Bernadette and Joseph Annie Beena(2013), A study on the implications f corporate restructuring, Prestige

International Journal of Management & IT- Sanchayan, Vol. 2(1)

Nauman Zahid; Asif Mujtaba Shah (2011), Mergers and Acquisitions in International Business, European Scientific

Journal, Vol.: 22, August 2011, pp. 43

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Annual Reports of Wockhardt

Annual Reports of Arvind Mills

http://business.mapsofindia.com/india-company/pharmaceutical.html

http://www.moneycontrol.com/company-facts/wockhardt/background/W05#W05

http://www.icra.in/Files/ticker/Indian%20Pharmaceutical%20Sector.pdf

http://www.cci.in/pdf/surveys_reports/Pharmaceutical-Industry-in-India.pdf

http://www.cdrindia.org/downloads/CDR%20Performance%20upto%20September%20%202013.pdf

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FM-106
SHORT RUN PERFORMANCE OF INITIAL PUBLIC OFFERINGS
(IPOs): EVIDENCE FROM CONSTRUCTION INDUSTRY IN INDIAN
CAPITAL MARKET
*Dr. Shashi Kala ** Dr. Vikas Deep

*Assistant Professor, University School of Business Studies,Punjabi University, Talwandi Sabo (151302), Punjab
(INDIA).

Mobile – 98760-06000

E-mail – [email protected]

**Assistant Professor, University School of Business Studies,

Punjabi University, Talwandi Sabo (151302), Punjab (INDIA)

Mobile – 98760-76000

E-mail – [email protected]

Abstract
The study tries to measure the extent of underpricing in IPOs of construction industry limited on National Stock
Exchange during 2006 to 2011. The total IPOs 276 were listed on National Stock Exchange during 2006 to 2011.
Nine industries were classified on the basis of 2 digit SIC industry classification. IPOs of 22 companies were found to
be in the construction industry category. For the present study secondary data has been used. Multivariate regression
model is applied to test the association between industry return on zero day and determinants. Return of construction
industry is taken as dependent variable and determinants were taken as independent variables. The underpricing
phenomenon was found to be present in the IPOs pertaining to Construction Industry which were listed during the
period 2006-2011. Normal Return on Zero Day was to the tune of 28.75percent and Market Adjusted Return was
found to be 21.82percent. Number of risk factors, issue size, offer to public are found to be negatively related with the
Normal Return. However, none of the negatively correlated variables were able to influence the return in significant
manner. Remaining variables were found to be having positive relation with the Normal Return on the zero day. But

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Oversubscription and Age of the Company were found to be influencing the Normal Return significantly at 5per cent
level of significance.

Keywords: Underpricing, Short run performance, IPOs.

Introduction

A lot of research has been done on the topic of underpricing. Underpricing of IPO has been considered as a prevalent
phenomenon across the world. This study is an attempt to empirically explore the determinants of underpricing of
Initial Public Offerings (IPOs) in the Indian Capital Market with special reference to Construction Industry. IPOs are
one of the largest sources of capital for the firm to invest in the growth opportunities. It encourages investment
activities in the economy by mobilizing funds from low growth opportunities to high growth opportunities. It has been
observed that IPOs are underpriced in most of the countries (Loughhran, Ritter and Rydqvst 1994). Underpricing is
the pricing of issue at lesser price than the true value of the issue. The degree of underpricing varies from country to
country and issue to issue in the same country. The underpriced IPO leaves money on the table which is a cost (loss of
capital) for the company and the same becomes a gain for the investor in the form of positive initial return on the
underpriced shares. Though underpricing is a cost for the issuing company still they underprice the issue.

Most of the publicly traded firms in the world today are organized, a relatively small privately owned start-up firms or
ventures, which are masterminded by a single individual or a group of individuals (Ogden Jen & O’Connor 2003).
These entrepreneurs simultaneously serve as the firm’s major shareholder, governance bodies and management teams.
They obtain financing for expansion of business from various sources and eventually sell equity shares to the general
public via an Initial Public Offering (IPO) of equity. An IPO is the first sale of corporation’s equity shares to investors
on a public stock exchange, and it is known as unseasoned equity. In addition to raising equity capital for the
business, IPO creates a public market in which founders and other shareholders can convert some of their wealth into
cash at future date (Ritter & Welch 2002). In addition, Ritter and Welch suggested that a non-financial reason for
going public is to increase publicity, but this plays only a minor role for the most firms. The IPO converts the
ownership from a private to public, which can create agency problems, such a conflict between owners and managers,
which normally arise due to separation of ownership and control in IPOs. Even IPOs are used to obtain funds; Ritter
and Welch (2002) have noted that this still leaves the question of why IPOs are the best way for entrepreneurs to raise
capital. Currently, there are stiff regulatory and financial reporting requirement relating to IPOs. Welch (2000) has
summarized the advantages and disadvantages of going public by making IPOs. The advantages of going public

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outweigh the disadvantages. Therefore, currently, many of the world’s privately owned companies have transformed
into publically owned companies via IPOs.

The Construction industry of India is an important indicator of the development as it creates investment
opportunities across various related sectors. The construction industry has contributed an estimated ₹ 6708 billion to
the national GDP in 2011-12 (a share of around 9%). The industry is fragmented, with a handful of major companies
involved in the construction activities across all segments; medium-sized companies specializing in niche activities;
and small and medium contractors who work on the subcontractor basis and carry out the work in the field. In 2011,
there were slightly over 500 construction equipment manufacturing companies in all of India. The sector is labor-
intensive and, including indirect jobs, provides employment to more than 35 million people.

The period from 1950 to mid 60’s witnessed the government playing an active role in the development of these
services and most of construction activities during this period were carried out by state owned enterprises and
supported by government departments. In the first five-year plan, construction of civil works was allotted nearly 50
per cent of the total capital outlay.

The first professional consultancy company, National Industrial Development Corporation (NIDC), was set up in the
public sector in 1954. Subsequently, many architectural, design engineering and construction companies were set up
in the public sector (Indian Railways Construction Limited (IRCON), National Buildings Construction Corporation
(NBCC), Rail India Transportation and Engineering Services (RITES), Engineers India Limited (EIL), etc.) and
private sector (M N Dastur and Co., Hindustan Construction Company (HCC), Ansals, etc.).

In India Construction has accounted for around 40 per cent of the development investment during the past 50 years.
Around 16 per cent of the nation's working population depends on construction for its livelihood. The Indian
construction industry employs over 30 million people and creates assets worth over ₹ 200 billion. It contributes more
than 5 per cent to the nation's GDP and 78 per cent to the gross capital formation. The share of the Indian construction
sector in total gross capital formation (GCF) came down from 60 per cent in 1970-71 to 34 per cent in 1990-91.
Thereafter, it increased to 48 per cent in 1993-94 and stood at 44 per cent in 1999-2000. In the 21st century, there has
been an increase in the share of the construction sector in GDP and capital formation. The Indian construction
industry comprises 200 firms in the corporate sector. In addition to these firms, there are about 120,000 Class A
contractors registered with various government construction bodies. There are thousands of small contractors, which
compete for small jobs or work as sub-contractors of prime or other contractors. This study is an attempt to measure
the degree of underpricing in IPOs of Construction Industry companies listed on National Stock Exchange Limited
during the period 2006 to 2011.

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Literature Review
Ibbotson (1975) analyzed both initial and after market performance (measured by risk-adjusted returns) on newly
issued common stocks which were offered to the public during 1960. Also showed that new issues were underpriced
and average initial performance was found to the tune of 11.4per cent while the distribution of return was skewed so
that subscriber of a single random new issue might have equal chance of getting profit or loss. Positive initial market
performance along with aftermarket efficiency indicated the new issues were underpriced.

Baron (1983) developed a theory for the demand for the advising and distribution services of investment bankers
when there was information asymmetry between an issuer of new securities and investment bankers. This analysis
assumed the delegation contract between the issuers and bankers in a negotiated fixed price offering. The delegation
contract exist when the issuer enlist the bankers to both advise on the offering price and distribute securities decisions.
Model examined the situations in which the issuer only utilizes the distribution services and the situation in which the
investment banker was not engaged at all. Results showed that when the banker was better informed than issuer the
new issues are underpriced. The issuers of unseasoned securities who are less informed about the capital market than
the issuers of seasoned securities were more likely to seek the advice of investment bankers.

Beatty and Ritter (1986) showed positive relationship between ex-ante uncertainty about an initial public offerings
value and its expected return. The implication of this finding was that if the level of ex-ante uncertainty is
endogenous, an issuing firm has an incentive to reduce this uncertainty by voluntarily disclosing information. They
also showed that resulting underpricing equilibrium was enforced by investment bankers who have reputation capital
at stake.

Rock (1986) presented a model which was directed toward an explanation of an anomaly in the new issue market.
New issue appears to be issued at discount. In market, there were two kinds of investors i.e. one category is of
informed investors who have access to superior information and other category is of uninformed investor not having
access to information. If the new shares are priced at expected value, the informed investor grabs the offer and
withdraws from the market when bad issues are offered. The analysis showed that new issues should be underpriced
to attract uninformed investors.

Objective of the Study

1. To measure the degree of extent of underpricing in construction industries.
2. To measure the short run performance of IPOs belonging to construction industry.

Research Methodology

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The study tries to measure the extent of underpricing in IPOs of construction industry limited on National Stock
Exchange during 2006 to 2011. The total IPOs 276 were listed on National Stock Exchange during 2006 to 2011.
Nine industries were classified on the basis of 2 digit SIC industry classification. IPOs of 22 companies were found to
be in the construction industry category. For the present study secondary data has been used. Data about the date of
incorporation, offer day, closing date, issue size, number of lead managers, nature of the industry and details about
risk factors have been taken from Red Herring prospectus of the companies, collected from SEBI’s official website.
Basis of allotment has been used to attain the details about oversubscription and proportionate share of public in total
issue and for cross verification of information about offer size. The data pertaining to movement of share prices and
Nifty index for the study period (2006-2011) has been compiled from the official website of National Stock Exchange
of India. Besides this, data has also been collected from the weblinks of Chittorgarh, CMlinks and daily newspaper
Economic Times.

For measuring short run performance of IPOs, return has been computed on the listing day only. Two types of returns;
Normal Return (NR) and Market Adjusted Return (MAR) have been calculated to measure the degree of underpricing.

Findings of the Study

Multivariate regression model is applied to test the association between industry return on zero day and determinants.
Return of construction industry is taken as dependent variable and determinants were taken as independent variables.
The empirical OLS regression model stands as follows

Normal Return (Type of industry) =α +β 1(Number of Lead Managers +β 2(Number of Risk Factors) +β 3(Issue Size)
+β4 (Offer to Public) +β5 (Oversubscription) +β6(Market Condition) + β7(Inverse of offer price) + β 8(Age) +β
9(Listing delay)+β 10(EAU)+ε In every equation ε stands for error term and α
denotes intercept.

Table 1
Effect of All Predictors on the Degree of Underpricing
(Normal Return Zero Day) for Construction Industry
Variables B SE B Beta P value VIF
(Constant) -22.358 42.100 .606
No. of Lead Managers 3.676 7.413 .136 .630 3.971
No. of Risk factors -.145 .484 -.053 .770 1.653

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Issue Size in Rs. Lacs -9.586E-5 .000 -.418 .218 5.369

Offer to Public in Percentage -.487 .829 -.096 .568 1.415
Oversubscription (No. of Times) .866 .332 .575 .024** 2.558
Market Condition (Hot/ Cold) 11.551 20.049 .124 .576 2.450
Inverse of Offer Price 94.471 1088.55 .019 .932 2.451
Age of the Company in Years 2.148 .963 .524 .048** 2.905
Listing Delay (No. of Days) .010 .019 .093 .598 1.534
Ex Ante Uncertainty (SD of 20 .063 .305 .035 .839 1.466
days Closing Price)
R Squared .791
Adjusted R Square .601
F 4.166
Sig F .014
*, **, *** denote significance at 10per cent, 5per cent and 1per cent level, respectively.
Source: SPSS Output
It can be observed from Table 1 that R2 value is .791 which means that all the variables together are capable of
explaining 79.1per cent variations in the dependent variable i.e. Normal Return in case of Construction industry on
listed day. For the F value and its significance value (.014, which is less than .05) indicate that model is fit to run the
regression and group of independent variables having enough explanatory power. The table also shows the causal
relationship among dependent variable and independent variables. Number of risk factors, issue size, offer to public
are found to be negatively related with the Normal Return. However, none of the negatively correlated variables were
able to influence the return in significant manner. Remaining variables were found to be having positive relation with
the Normal Return on the zero day. But Oversubscription and Age of the Company were found to be influencing the
Normal Return significantly at 5per cent level of significance.

The Variance Inflation Factor (VIF) indicates whether a predictor has a strong relationship with the other predictor(s).
Since the largest VIF is not greater than 10 and the average VIF is not substantially greater than 1, hence there is no
cause of concern and the regression is not biased.

Graph 1.1

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Source: SPSS Output

To test the normality of residuals, we look at the histogram and normal probability plot in Graph 1.1 and 1.2, we see
that distribution is very normal. The histogram is symmetrical and approximately bell shaped. For our model the dots
lie almost exactly along the diagonal, which indicates a normal distribution. Hence this plot also suggests that
residuals are normally distributed.

Graph 1.2

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Source: SPSS Output

Graph 1.3 is not showing funnel shape which means that shows the non existence of hetroscedasticity.

Graph 1.3

Source: SPSS Output

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Conclusion

The underpricing phenomenon was found to be present in the IPOs pertaining to Construction Industry which were
listed during the period 2006-2011. Normal Return on Zero Day was to the tune of 28.75percent and Market Adjusted
Return was found to be 21.82percent. Number of risk factors, issue size, offer to public are found to be negatively
related with the Normal Return. However, none of the negatively correlated variables were able to influence the return
in significant manner. Remaining variables were found to be having positive relation with the Normal Return on the
zero day. But Oversubscription and Age of the Company were found to be influencing the Normal Return
significantly at 5per cent level of significance.

References
1. Ibbotson. (1975). Price Performance of Common Stock New Issues. In Journal of Financial Economics
(Vol.2(3), pp. 235-272)
2. Ben Slama Zouari, S., Boudriga, A. and Boulila Taktak, N. (2011). Determinants of IPO Underpricing:
Evidence from Tunisia. In International Journal of Business and Finance Research (Vol. 5,(1), pp.13-32)
3. Fernando, C., Krishnamurthy, S. & Spindt, P. (1999). Offer Price, Target Ownership Structure and IPO
Performance. In Centre for Financial Institutions Working Paper, University of Pennsylvania, Philadelphia,
PA.
4. Bansal, R., Khanna, (2012). Determinants of IPOs Initial Return: Extreme Analysis of Indian Market. In
Journal of Financial Risk Management. (Vol.1, (5), pp. 68-74).
5. Megginson, W. L. and Weiss, K.A. (1991). Venture Capitalist Certifications in Initial Public Offerings. In
Journal of Finance. (Vol. 46, pp. 879-903)
6. Bansal, ibid 4.
7. Islam Md Aminul, Ali Ruhani and Ahmed Zamri. (2010). An Empirical Investigation of the Underpricing of
Initial Public Offerings In the Chittagong Stock Exchange. In International Journal of Economics and
Finance. (Vol.2 (4), pp. 36-46)
8. Pande, A., Vaidyanathan, R. (2009). Determinants of IPO Underpricing in National Stock Exchange in India.
In The ICFAI Journal of Applied Finance, (Vol. 15 (1), pp. 14-30)
9. Kooli, M. and Suret, J.M. (2002). The Underpricing of Initial Public Offerings: further Canadian Evidence. In
Scientific Series. (Vol. 2, pp. 1-44)

249
 National Conference on Current Issues and Opportunities in Global
Emerging Business Scenario
(ISBN No. 978-93-5258-981-4)

10. Kenourgious, D. F., Papathansiou, S. & Melas. (2007). Initial Performance of Greek IPOs, Underwriter’s
Reputation and Oversubscription. In Managerial Finance, (Vol.33 (5), pp. 332-343)
11. Schertler, A. (2002). The Determinants of Underpricing: Initial Public Offerings on the Neuer Market and the
Nouveau Marché. Working paper available at EIFC at http://www.intech.unu.edu/publications/eifc-tf-
papers/eifc02-12.pdf.
12. Websites
13. http://www.sebi.govt.in

14. http://www.nseindia.com

250
 National Conference on Current Issues and Opportunities in Global
Emerging Business Scenario
(ISBN No. 978-93-5258-981-4)

FM-107
MAKE IN INDIA – AN INITIATIVE FOR MANUFACTURING
DESTINATION
* Manpreet Kaur ** Harvinder Singh Mand

Abstract
India has been witness for major reforms that poised to become the fastest growing economy of the world. Make in
India is an initiative, conceptualized by the Prime Minister of India, Narandra Modi on 25 September 2014 with an
aim to make India the manufacturing destination. The major focus is to encouraging the efficient production of goods,
attract investment, job creation and create the international market for the products. The Indian manufacturing sector
is a cause of concern with respect to the productivity and growth. The contribution of manufacturing sector to India's
GDP has largely been stagnant at 15.5% over the last 35 years and the contribution to the export of goods remains
meager. The 'Make in India' initiative assumes good start to enlighten the manufacturing sector and to boost economic
growth in India. This research paper aims to access the government initiatives, opportunities and challenges in the
path of make in India scheme.
*Research scholar at Punjabi University Patiala

**Assistant Professor at University College Ghudda (Bathinda)

INTRODUCTION

India has transformed from an agrarian economy into the services sector driven economy, while the contribution of
manufacturing sector has remained elusive. The share of service sector in India’s GDP has risen from 40% to 57%
over the last two decades however theshare of manufacturing has largely remained stagnant averaging around 15.5%
of GDP over the last 35 years. Further over, as of 2013, the share of manufacturing export in India’s export basket
comprise of 62% manufacturing exports which is the lowest among most Asian economies like China 94%, Japan
88%, Philippines 77%, Singapore 70% and Thailand 74%. The concept of “Make in India” is a big push from the
government focusing to drive manufacturing sector. The objective of the scheme is to facilitate investments, foster
innovation, build world class manufacturing infrastructure and to ensure the contribution of manufacturing sector
increased from around 16% of country’s GDP to 25% in next 5 years. Under the initiative, 25 sectors have been
focused, the sectors are Automobiles, Automobile Components, Aviation, Biotechnology, Chemicals, Construction,
Defense manufacturing, Electrical Machinery, Electronic systems, Food Processing, Information Technology and

251
 National Conference on Current Issues and Opportunities in Global
Emerging Business Scenario
(ISBN No. 978-93-5258-981-4)

Business process management, Leather, Media and Entertainment, Mining, Oil and Gas, Pharmaceuticals, Ports and
Shipping, Railways, Renewable Energy, Roads and Highways, Space, Textiles and Garments, Thermal Power,
Tourism and Hospitality, Wellness.

OBJECTIVES OF THE STUDY

Followings are the main objectives of the study:-
 To study the purpose of “Make in India”.
 Major challenges in the path of scheme and government initiatives.
 Give suggestions on the basis of findings.

RESEARCH METHODOLOGY
Research Type: Descriptive Research
Data type and Source used: The present study is based on secondary data. The required information has
been derived from the article from newspapers, Magazines and Journals and various related web-sites which
directly or indirectly related with the research topic.

FINDINGS OF THE STUDY

Purpose of make in India
Situation of Indian manufacturing sector is causes of concern when compared by other Asian countries.
According to ‘2013 Global Manufacturing Competitiveness Index (GMCI)’, India’s ranking slipped to 4th
from 2nd rank in the 2009-10. However, according to World Bank's 'Doing Business 2015' report, India
ranks 142nd out of 189 economies, lagging substantially behind China (90th) and Vietnam (78th), but also
behind neighbors like Nepal (108th), Bhutan (125th) and Pakistan (128th). So the main reason behind the
campaign is to reboot the Indian manufacturing sectors and economic condition as well.
Second, India has the edge of best talented and young workforce in the world, yet the major part of the
workforce remains untapped due to fragmented marketplace. With the Make in India initiative, the
government aims to create 100 million new jobs by 2022.The firms estimate that 7.2 lakh temporary jobs
are likely to be created in the next one year. It would add 8-13 per cent to the current jobs pool as
investment into manufacturing, engineering and related sectors rise. So the Make in India initiative has led

252
 National Conference on Current Issues and Opportunities in Global
Emerging Business Scenario
(ISBN No. 978-93-5258-981-4)

to an increase in hiring in these segments as well as e-commerce and Internet related sectors. According to
the director general of CII Mr. Chandrajit Banerjee, “Make in India has the potential to emerge as a force
multiplier to provide the emerging workforce with new livelihood opportunities."
Third, the model attracts investment in the country with an aim to increased industrial production and grater
transformation of technology. India has been ranked among the top 3 attractive destinations for inbound
investments. The regulatory environment in terms of foreign direct investment has been consistently eased
in 15 major sectors to make it investor-friendly. The first seven months of the landmark ‘Make in India’
initiative saw Foreign Direct Investment (FDI) soaring by 48%, said a media update from India’s Ministry
of Commerce and Industry. Foreign Institutional Investors (FIIs) channeled a record $40.92 billion into
India from October 2014 to April 2015, an unprecedented 717% FDI upsurge in the year-on-year period.
MAJOR CONCERNS AND RELATED GOVERNMENT INITIATIVES FOR THE
SCHEME
In order to achieve sustainable 10% growth in the manufacturing sector, the government has to overcome
the reported challenges and turn the vision into reality. Following are the major challenges and reforms:-
Ease of doing business: India has been very stringent in ease of doing business indicators like starting a
business, dealing with construction permits, getting electricity, registering property, getting credit,
protecting minority investors, paying taxes, trading across borders. Lot of time and cost has involved for
completing the various legal formalities for each parameter. Government has undertaken a number of steps
to improve Ease of Doing Business in the country.
 The multiple prior permissions will be replaced by a pre-existing regulatory mechanism.
 The process of applying for Industrial License (IL), Industrial Entrepreneur Memorandum (IEM)
and obtaining environment and forest clearances has been made online 24X7online.
 A large number of components of Defense Products’ list have been excluded from the purview of
Industrial Licensing.
 Initial validity period of Industrial License has been increased to three years from two years, also,
two extensions of two years each in the initial validity of three years of the Industrial License shall
now be allowed up to seven years. This will give enough time to licensees to procure land and
obtain the necessary clearances/approvals from authorities. Process of obtaining environment and
forest clearances has been made online.

253
 National Conference on Current Issues and Opportunities in Global
Emerging Business Scenario
(ISBN No. 978-93-5258-981-4)

 The Department of Industrial Policy and Promotion has advised Ministries and State Governments
to simplify and rationalize the regulatory environment through business process reengineering and
use of information technology.
 14 Government of India services have been integrated with the e-BIZ portal: Through e-Biz portal, a
business user can fill the e-Forms online/offline, upload the attachments, make payment online and
submit the forms for processing of the department.
Upgrade Infrastructure
The major objective behind “Make in India” initiative is to focus on heavy engineering and strengthens
secondary and tertiary sectors. The upgraded infrastructure with Industrial Corridors, Information
Technology and rural up gradation is required for effective functioning. Following initiative taken by the
government to upgrade the infrastructure
 Industrial Parks: Every state in India has developed industrial parks for setting up of industries.
National Investment & Manufacturing Zones: NIMZ is a combination of production units, public
utilities, logistics, residential areas and administrative services. It would have a processing area,
where manufacturing facilities, along with associated logistics and other services and required
infrastructure will be located, and a non-processing area, to include residential, commercial and
other social and institutional infrastructure.
 Special Economic Zones: India has also developed SEZs that are specifically delineated enclaves
treated as foreign territory for the purpose of industrial, service and trade operations, with relaxation
in customs duties and a more liberal regime in respect of other levies, foreign investment.
 Sector specific clusters: like electronic manufacturing clusters, mega food parks etc: The
government of India has been promoting the development of sector specific parks.
 Country specific zones: The country also has few dedicated zones for industrial units from countries
for example Neemrana Japanese Zone etc.
 Industrial corridors: The Government of India is developing the Delhi-Mumbai Industrial Corridor
(DMIC) as a global manufacturing and investment destination utilizing the 1,483 km-long, high-
capacity western Dedicated Railway Freight Corridor (DFC) as the backbone. Other four corridors
include Bengaluru Mumbai Economic Corridor (BMEC); Amritsar - Kolkata Industrial
Development Corridor (AKIC); Chennai Bengaluru Industrial Corridor (CBIC), East Coast

254
 National Conference on Current Issues and Opportunities in Global
Emerging Business Scenario
(ISBN No. 978-93-5258-981-4)

Economic Corridor (ECEC) with Chennai Vizag Industrial Corridor as the first phase of the project
(CVIC). The objective is to increase the share of manufacturing in the GDP of the country and to
create smart sustainable cities where manufacturing will be the key economic driver.
Labour laws and skill development
China as a Marxists Country attracted outside business by meeting all the requirements of industries with
liberal laws and incentives but in India it is difficult as it is a democratic country. India has some of the most
restrictive labour laws. Both the central and state governments will have to implement labour reforms which
will help labor rights, human resource management, and worker and management relationship with proper
safety.
 A dedicated Shram Suvidha Portal: The portal would allot Labour Identification Number (LIN) to
nearly 6 lakhs units and allow them to file online compliance for 16 out of 44 labour laws.
 An all-new Random Inspection Scheme: Utilizing technology to eliminate human discretion in
selection of units for Inspection, and uploading of Inspection Reports within 72 hours of inspection
mandatory.
 Universal Account Number: Enables 4.17 crore employees to have their Provident Fund account
portable, hassle-free and universally accessible.
 Apprentice Protsahan Yojana: Will support manufacturing units mainly and other establishments by
reimbursing 50% of the stipend paid to apprentices during first two years of their training.
 Multi-skill development programme has been initiated with a mission for job creation and
entrepreneurship.

Foreign Investment and Trade

The best way to ensure foreign investment is of providing qualitative framework that is required to be
operated in a competitive environment. Government initiatives with respect to FDI are:
 Townships, shopping complexes & business centers – all allow up to
100% FDI under the auto route. Conditions on minimum capitalization & floor area restrictions have
now been removed for the construction development sector.
 India's defense sector now allows consolidated FDI up to 49% under the
automatic route. FDI beyond 49% will now be considered by the Foreign Investment Promotion

255
 National Conference on Current Issues and Opportunities in Global
Emerging Business Scenario
(ISBN No. 978-93-5258-981-4)

Board. Government approval route will be required only when FDI results in a change of ownership
pattern.
 Private sector banks now allow consolidated FDI up to 74%.
 Up to 100% FDI is now allowed in coffee/rubber/cardamom/palm oil &
olive oil plantations via the automatic route and to in duty free shops located and operated in the
customs bonded areas.
 Foreign Equity caps have now been increased for establishment &
operation of satellites, credit information companies, non-scheduled air transport & ground handling
services from 74% to 100%.
 100% FDI allowed in medical devices.
 FDI cap increased in insurance & sub-activities from 26% to 49%.
 FDI up to 49% has been permitted in the Pension Sector.
 Construction, operation and maintenance of specified activities of
Railway sector opened to 100% foreign direct investment under automatic route.
 100% FDI allowed in medical devices and White Label ATM Operations.
Addressing the tax concerns
To make the country a manufacturing hub, the unfavorable factors must be removed. India should also be
ready to give tax concessions to companies which come and set up units in the country.
 The corporate tax rate for companies registered in India to go down from 30% to 25% of net profits
in a phased manner over the next four years starting from FY 16-17.Export Incentives: Under the
foreign trade policy exports have been provided with several incentives like duty drawback, duty
remission schemes etc.
 State Incentives: Apart from above each state in India offers additional incentives for industrial
projects. Some of the states also have separate policies for textile sector. Incentives are in areas like
rebated land cost; relaxation in stamp duty exemption on sale/lease of land; power tariff incentives;
concessional rate of interest on loans; investment subsidies / tax incentives; backward areas
subsidies; special incentive packages for mega projects.

Research and development up gradation

256
 National Conference on Current Issues and Opportunities in Global
Emerging Business Scenario
(ISBN No. 978-93-5258-981-4)

India should be ready to tackle elements that adversely affect competitiveness of manufacturing.
India must also give boost to high-tech imports of specialized equipment and research and development. To
achieve this, India has to be better prepared and motivated to accelerate world class R & D programs.
 R&D Incentives: Higher weighted deductions of 200% provided for expenditure related to R&D
subject to fulfillment of conditions.
CONCLUSION AND SUGGESTIONS
The various measures undertaken by the NDA Government to address issues related to economic growth,
delay in Government decisions and reforms in the Labour law, Land law and taxation have kick started the
manufacturing sector. The issues and challenges involved in the concept of “Make in India‟ are being
resolved through big thrust in policy initiatives and further commitment by the government to ease rules of
doing business, boost manufacturing and provide a stable non-adversarial tax regime to ultimately revive the
otherwise sluggish economy which is critical to generate jobs. If governance continues in the current
manner, we can definitely hope to see significant and sustainable growth in the manufacturing sector and
progress towards India becoming a global manufacturing hub.

REFERENCES
Updates from News Channels
Article: PM Narendra Modi's US visit: Eight highlights
http://articles.economictimes.indiatimes.com/2014-10-01/news/54516929_1_prime-minister-narendra-
modi-modi-and-obama-saath
www.phdcci.in
Goods and services tax: http://gstindia.com/Nathani et al(2015) “ Make in India: Issues and Challenges - A
Paradigm Shift”IJSRD - International Journal for Scientific Research & Development| Vol. 2, Issue 12,
2015 | ISSN (online): 2321-0613
http: // www.Make
in India.com/policy/new initiatives/

257
 National Conference on Current Issues and Opportunities in Global
Emerging Business Scenario
(ISBN No. 978-93-5258-981-4)

FM-107

MAKE IN INDIA – AN INITIATIVE FOR MANUFACTURING

DESTINATION

* Manpreet Kaur ** Harvinder Singh Mand

Abstract
India has been witness for major reforms that poised to become the fastest growing economy of the world. Make in
India is an initiative, conceptualized by the Prime Minister of India, Narandra Modi on 25 September 2014 with an
aim to make India the manufacturing destination. The major focus is to encouraging the efficient production of goods,
attract investment, job creation and create the international market for the products. The Indian manufacturing sector
is a cause of concern with respect to the productivity and growth. The contribution of manufacturing sector to India's
GDP has largely been stagnant at 15.5% over the last 35 years and the contribution to the export of goods remains
meager. The 'Make in India' initiative assumes good start to enlighten the manufacturing sector and to boost economic
growth in India. This research paper aims to access the government initiatives, opportunities and challenges in the
path of make in India scheme.
*Research scholar at Punjabi University Patiala

**Assistant Professor at University College Ghudda (Bathinda)

INTRODUCTION

India has transformed from an agrarian economy into the services sector driven economy, while the contribution of
manufacturing sector has remained elusive. The share of service sector in India’s GDP has risen from 40% to 57%
over the last two decades however theshare of manufacturing has largely remained stagnant averaging around 15.5%
of GDP over the last 35 years. Further over, as of 2013, the share of manufacturing export in India’s export basket
comprise of 62% manufacturing exports which is the lowest among most Asian economies like China 94%, Japan
88%, Philippines 77%, Singapore 70% and Thailand 74%. The concept of “Make in India” is a big push from the
government focusing to drive manufacturing sector. The objective of the scheme is to facilitate investments, foster
innovation, build world class manufacturing infrastructure and to ensure the contribution of manufacturing sector
increased from around 16% of country’s GDP to 25% in next 5 years. Under the initiative, 25 sectors have been
focused, the sectors are Automobiles, Automobile Components, Aviation, Biotechnology, Chemicals, Construction,

258
 National Conference on Current Issues and Opportunities in Global
Emerging Business Scenario
(ISBN No. 978-93-5258-981-4)

Defense manufacturing, Electrical Machinery, Electronic systems, Food Processing, Information Technology and
Business process management, Leather, Media and Entertainment, Mining, Oil and Gas, Pharmaceuticals, Ports and
Shipping, Railways, Renewable Energy, Roads and Highways, Space, Textiles and Garments, Thermal Power,
Tourism and Hospitality, Wellness.

OBJECTIVES OF THE STUDY

Followings are the main objectives of the study:-
 To study the purpose of “Make in India”.
 Major challenges in the path of scheme and government initiatives.
 Give suggestions on the basis of findings.

RESEARCH METHODOLOGY
Research Type: Descriptive Research
Data type and Source used: The present study is based on secondary data. The required information has
been derived from the article from newspapers, Magazines and Journals and various related web-sites which
directly or indirectly related with the research topic.

FINDINGS OF THE STUDY

Purpose of make in India
Situation of Indian manufacturing sector is causes of concern when compared by other Asian countries.
According to ‘2013 Global Manufacturing Competitiveness Index (GMCI)’, India’s ranking slipped to 4th
from 2nd rank in the 2009-10. However, according to World Bank's 'Doing Business 2015' report, India
ranks 142nd out of 189 economies, lagging substantially behind China (90th) and Vietnam (78th), but also
behind neighbors like Nepal (108th), Bhutan (125th) and Pakistan (128th). So the main reason behind the
campaign is to reboot the Indian manufacturing sectors and economic condition as well.
Second, India has the edge of best talented and young workforce in the world, yet the major part of the
workforce remains untapped due to fragmented marketplace. With the Make in India initiative, the
government aims to create 100 million new jobs by 2022.The firms estimate that 7.2 lakh temporary jobs
are likely to be created in the next one year. It would add 8-13 per cent to the current jobs pool as

259
 National Conference on Current Issues and Opportunities in Global
Emerging Business Scenario
(ISBN No. 978-93-5258-981-4)

investment into manufacturing, engineering and related sectors rise. So the Make in India initiative has led
to an increase in hiring in these segments as well as e-commerce and Internet related sectors. According to
the director general of CII Mr. Chandrajit Banerjee, “Make in India has the potential to emerge as a force
multiplier to provide the emerging workforce with new livelihood opportunities."
Third, the model attracts investment in the country with an aim to increased industrial production and grater
transformation of technology. India has been ranked among the top 3 attractive destinations for inbound
investments. The regulatory environment in terms of foreign direct investment has been consistently eased
in 15 major sectors to make it investor-friendly. The first seven months of the landmark ‘Make in India’
initiative saw Foreign Direct Investment (FDI) soaring by 48%, said a media update from India’s Ministry
of Commerce and Industry. Foreign Institutional Investors (FIIs) channeled a record $40.92 billion into
India from October 2014 to April 2015, an unprecedented 717% FDI upsurge in the year-on-year period.
MAJOR CONCERNS AND RELATED GOVERNMENT INITIATIVES FOR THE
SCHEME
In order to achieve sustainable 10% growth in the manufacturing sector, the government has to overcome
the reported challenges and turn the vision into reality. Following are the major challenges and reforms:-
Ease of doing business: India has been very stringent in ease of doing business indicators like starting a
business, dealing with construction permits, getting electricity, registering property, getting credit,
protecting minority investors, paying taxes, trading across borders. Lot of time and cost has involved for
completing the various legal formalities for each parameter. Government has undertaken a number of steps
to improve Ease of Doing Business in the country.
 The multiple prior permissions will be replaced by a pre-existing regulatory mechanism.
 The process of applying for Industrial License (IL), Industrial Entrepreneur Memorandum (IEM)
and obtaining environment and forest clearances has been made online 24X7online.
 A large number of components of Defense Products’ list have been excluded from the purview of
Industrial Licensing.
 Initial validity period of Industrial License has been increased to three years from two years, also,
two extensions of two years each in the initial validity of three years of the Industrial License shall
now be allowed up to seven years. This will give enough time to licensees to procure land and

260
 National Conference on Current Issues and Opportunities in Global
Emerging Business Scenario
(ISBN No. 978-93-5258-981-4)

obtain the necessary clearances/approvals from authorities. Process of obtaining environment and
forest clearances has been made online.
 The Department of Industrial Policy and Promotion has advised Ministries and State Governments
to simplify and rationalize the regulatory environment through business process reengineering and
use of information technology.
 14 Government of India services have been integrated with the e-BIZ portal: Through e-Biz portal, a
business user can fill the e-Forms online/offline, upload the attachments, make payment online and
submit the forms for processing of the department.
Upgrade Infrastructure
The major objective behind “Make in India” initiative is to focus on heavy engineering and strengthens
secondary and tertiary sectors. The upgraded infrastructure with Industrial Corridors, Information
Technology and rural up gradation is required for effective functioning. Following initiative taken by the
government to upgrade the infrastructure
 Industrial Parks: Every state in India has developed industrial parks for setting up of industries.
National Investment & Manufacturing Zones: NIMZ is a combination of production units, public
utilities, logistics, residential areas and administrative services. It would have a processing area,
where manufacturing facilities, along with associated logistics and other services and required
infrastructure will be located, and a non-processing area, to include residential, commercial and
other social and institutional infrastructure.
 Special Economic Zones: India has also developed SEZs that are specifically delineated enclaves
treated as foreign territory for the purpose of industrial, service and trade operations, with relaxation
in customs duties and a more liberal regime in respect of other levies, foreign investment.
 Sector specific clusters: like electronic manufacturing clusters, mega food parks etc: The
government of India has been promoting the development of sector specific parks.
 Country specific zones: The country also has few dedicated zones for industrial units from countries
for example Neemrana Japanese Zone etc.
 Industrial corridors: The Government of India is developing the Delhi-Mumbai Industrial Corridor
(DMIC) as a global manufacturing and investment destination utilizing the 1,483 km-long, high-
capacity western Dedicated Railway Freight Corridor (DFC) as the backbone. Other four corridors

261
 National Conference on Current Issues and Opportunities in Global
Emerging Business Scenario
(ISBN No. 978-93-5258-981-4)

include Bengaluru Mumbai Economic Corridor (BMEC); Amritsar - Kolkata Industrial

Development Corridor (AKIC); Chennai Bengaluru Industrial Corridor (CBIC), East Coast
Economic Corridor (ECEC) with Chennai Vizag Industrial Corridor as the first phase of the project
(CVIC). The objective is to increase the share of manufacturing in the GDP of the country and to
create smart sustainable cities where manufacturing will be the key economic driver.
Labour laws and skill development
China as a Marxists Country attracted outside business by meeting all the requirements of industries with
liberal laws and incentives but in India it is difficult as it is a democratic country. India has some of the most
restrictive labour laws. Both the central and state governments will have to implement labour reforms which
will help labor rights, human resource management, and worker and management relationship with proper
safety.
 A dedicated Shram Suvidha Portal: The portal would allot Labour Identification Number (LIN) to
nearly 6 lakhs units and allow them to file online compliance for 16 out of 44 labour laws.
 An all-new Random Inspection Scheme: Utilizing technology to eliminate human discretion in
selection of units for Inspection, and uploading of Inspection Reports within 72 hours of inspection
mandatory.
 Universal Account Number: Enables 4.17 crore employees to have their Provident Fund account
portable, hassle-free and universally accessible.
 Apprentice Protsahan Yojana: Will support manufacturing units mainly and other establishments by
reimbursing 50% of the stipend paid to apprentices during first two years of their training.
 Multi-skill development programme has been initiated with a mission for job creation and
entrepreneurship.

Foreign Investment and Trade

The best way to ensure foreign investment is of providing qualitative framework that is required to be
operated in a competitive environment. Government initiatives with respect to FDI are:

262
 National Conference on Current Issues and Opportunities in Global
Emerging Business Scenario
(ISBN No. 978-93-5258-981-4)

1. Townships, shopping complexes & business centers – all allow up to 100% FDI under the auto route.
Conditions on minimum capitalization & floor area restrictions have now been removed for the construction
development sector.
2.India's defense sector now allows consolidated FDI up to 49% under the automatic route. FDI beyond
49% will now be considered by the Foreign Investment Promotion Board. Government approval route will
be required only when FDI results in a change of ownership pattern.
3.Private sector banks now allow consolidated FDI up to 74%.
4.Up to 100% FDI is now allowed in coffee/rubber/cardamom/palm oil & olive oil plantations via the
automatic route and to in duty free shops located and operated in the customs bonded areas.
5.Foreign Equity caps have now been increased for establishment & operation of satellites, credit
information companies, non-scheduled air transport & ground handling services from 74% to 100%.
6.100% FDI allowed in medical devices.
7.FDI cap increased in insurance & sub-activities from 26% to 49%.
8.FDI up to 49% has been permitted in the Pension Sector.
9.Construction, operation and maintenance of specified activities of Railway sector opened to 10.100%
foreign direct investment under automatic route.
11.100% FDI allowed in medical devices and White Label ATM Operations.
Addressing the tax concerns
To make the country a manufacturing hub, the unfavorable factors must be removed. India should also be
ready to give tax concessions to companies which come and set up units in the country.
 The corporate tax rate for companies registered in India to go down from 30% to 25% of net profits
in a phased manner over the next four years starting from FY 16-17.Export Incentives: Under the
foreign trade policy exports have been provided with several incentives like duty drawback, duty
remission schemes etc.
 State Incentives: Apart from above each state in India offers additional incentives for industrial
projects. Some of the states also have separate policies for textile sector. Incentives are in areas like
rebated land cost; relaxation in stamp duty exemption on sale/lease of land; power tariff incentives;
concessional rate of interest on loans; investment subsidies / tax incentives; backward areas
subsidies; special incentive packages for mega projects.

263
 National Conference on Current Issues and Opportunities in Global
Emerging Business Scenario
(ISBN No. 978-93-5258-981-4)

Research and development up gradation

India should be ready to tackle elements that adversely affect competitiveness of manufacturing.
India must also give boost to high-tech imports of specialized equipment and research and development. To
achieve this, India has to be better prepared and motivated to accelerate world class R & D programs.
 R&D Incentives: Higher weighted deductions of 200% provided for expenditure related to R&D
subject to fulfillment of conditions.

CONCLUSION AND SUGGESTIONS

The various measures undertaken by the NDA Government to address issues related to economic growth,
delay in Government decisions and reforms in the Labour law, Land law and taxation have kick started the
manufacturing sector. The issues and challenges involved in the concept of “Make in India‟ are being
resolved through big thrust in policy initiatives and further commitment by the government to ease rules of
doing business, boost manufacturing and provide a stable non-adversarial tax regime to ultimately revive the
otherwise sluggish economy which is critical to generate jobs. If governance continues in the current
manner, we can definitely hope to see significant and sustainable growth in the manufacturing sector and
progress towards India becoming a global manufacturing hub.
REFERENCES
Updates from News Channels
Article: PM Narendra Modi's US visit: Eight highlights
http://articles.economictimes.indiatimes.com/2014-10-01/news/54516929_1_prime-minister-narendra-
modi-modi-and-obama-saath
www.phdcci.in
Goods and services tax: http://gstindia.com/Nathani et al(2015) “ Make in India: Issues and Challenges - A
Paradigm Shift”IJSRD - International Journal for Scientific Research & Development| Vol. 2, Issue 12,
2015 | ISSN (online): 2321-0613
http: // www.make in India.com/policy/new initiatives/

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FM-108
Role of Insurance Sector in Emergence of India as a Global Economic
Superpower.
*Nipun Aggarwal **Dr. Dyal Bhatnagar

*Research Scholar, School of Management Studies, Punjabi University, Patiala, Punjab

E-mail: [email protected], Tel: 9466852202

**Assistant Professor, University School of Business Studies, Punjabi University, Guru Kashi Campus, Talwandi
Sabo, Bhatindha, Punjab

Email: [email protected], Tel: 8146833444

INTRODUCTION
History of India’s Insurance Sector

Insurance has a long history in India. Life Insurance in its current form was introduced in 1818 when Oriental Life
Insurance Company began its operations in India. General Insurance was however a comparatively late entrant in
1850 when Triton Insurance company set up its base in Kolkata. History of Insurance in India can be broadly
bifurcated into three eras:

a) Pre Nationalisation

b) Nationalisation and

c) Post Nationalisation.

Life Insurance was the first to be nationalized in 1956. Life Insurance Corporation of India was formed by
consolidating the operations of various insurance companies. General Insurance followed suit and was nationalized in
1973. General Insurance Corporation of India was set up as the controlling body with New India, United India,
National and Oriental as its subsidiaries. The process of opening up the insurance sector was initiated against the
background of Economic Reform process which commenced from 1991. For this purpose Malhotra Committee was
formed during this year who submitted their report in 1994 and Insurance Regulatory Development Act (IRDA) was

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passed in 1999. Resultantly Indian Insurance was opened for private companies and Private Insurance Company
effectively started operations from 2001.

In Life Insurance business, India ranked 9th among the 156 countries for which data are published by Swiss Re. The
insurance market in most developed countries has been well covered and is likely to saturate soon. India is one of the
emerging economies in the world and is expected to maintain this stature in future as well. Therefore many global
players are looking towards India. Insurance penetration in India and insurance density in India is still low, hence
insurance players both Indian and global have ample opportunities to expand their business in untapped semi urban
and rural areas.

OBJECTIVES OF THE STUDY

 To review history of Indian insurance sector.

 To analyze status of India’s insurance sector after privatization.
 To examine the roll of Insurance sector in emergence of India as global super power.

METHODOLOGY

The study is based on secondary data by IRDA Annual Reports, Journals and Internet websites. Data is processed and
conclusions are derived.

CURRENT SCENARIO OF INSURANCE SECTOR

Insurance business has been traditionally classified into life insurance and non-life insurance (also known as general
insurance). Non-life insurance broadly covers fire insurance, marine insurance and miscellaneous Insurance
(including health insurance, motor insurance, burglary insurance, engineering insurance, and cattle insurance. Life
insurance has been viewed as a tax saving option for a long time in India; but this mindset is slowly changing and
insurance is being taken irrespective of tax benefits. The insurance market now offers insurance products that suit
people’s specific requirements and various demographic characteristics.
Among the various products offered by life insurers, the most common are endowment assurance, money back;
whole life, term assurance and unit linked insurance plans (ULIPs). Out of these, endowment assurance and ULIPs
are the most widely used; ULIP is one of the biggest innovations of the market, popularized by private players give
various options to investors. In a ULIP, a part of the premium paid goes towards life cover and the remaining is
invested in units like mutual funds. Lately, these products have been gaining popularity owing to sustained bullish

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trend in the Indian capital market; hence, the IRDA has issued guidelines for ULIP products that specify the
minimum level of sum assured, minimum period of premium payment and several other requirements, including
NAV computation methodology.
Furthermore, life insurance companies have identified the need for structured retirement’s plans; for instance, long-
term fund management and pension are some opportunities that life insurers are waiting to capitalize on.
The Indian general insurers, in the meanwhile, are looking at new avenues, besides traditional offerings. The Indian
market terrorism risk insurance pool, which was introduced to provide cover against terror risk, and weather
insurance, are two such initiatives.

Registered Insurers
At end-September 2015, there were forty-eight insurance companies operating in India; of which twenty three were in
the life insurance business and the remaining twenty-four were in general insurance business. In addition, General
Insurance Corporation (GIC) is the national reinsurer of the forty-eight companies presently in operations, 8 are in the
public sector: two specialized insurers, namely Export Credit Guarantee Corporation (ECGC) and Agriculture
Insurance Company of India Ltd (AIC), one in life insurance, four in general insurance and one in re-insurance. The
remaining forty companies are in the private sector.
During the financial year 2009-10, IRDA had granted Certificate of Registration to three new companies, viz.,
IndiaFirst Life Insurance Company Ltd.; SBI General Insurance Company Ltd., and Max Bupa Health Insurance
Company Ltd. L & T General Insurance Company Ltd., was granted registration in 2010-11.
Source: Annual Report IRDA 2014-15

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INSURANCE PENETRATION & DENSITY IN INDIA

The measure of insurance penetration and density reflects the level of development of insurance sector in a country.
While insurance penetration is measured as the percentage of insurance premium to GDP, insurance density is
calculated as the ratio of premium to population (per capita premium). Since opening up of Indian insurance sector for
private participation, India has reported increase in both insurance penetration and density as insurance premium is
increasing over a period of time as shown in the graph. But the increase has been almost entirely contributed by the
life insurance sector.
The insurance density of life insurance sector had gone up from USD 9.1 in 2001 to USD 44 in 2014. Similarly,
insurance penetration of life sector had gone up from 2.15 per cent in 2001 to 2.60 percent in 2014.The penetration of
non-life insurance sector in the country increases from 0.56% to 0.70 % for the last 14 years. However, there is a
increase in density, which has increased from USD 2.4 in 2001 to USD 11 in 2014.

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INVESTMENT PATTERN OF INSURANCE SECTOR

Investments of Life Insurers
IRDA provides guidelines for investment pattern of insurance sector. The various sources of funds available for
investment by life insurers can be broadly classified as funds from (i) traditional products and (ii) ULIP products. The
total funds invested by life insurers as on 31st March, 2014 was 19,57,466crore, of these 3,31,661 crore (16.94 per
cent of total funds) represents ULIP funds and the remaining 16,25,804 crore (83.06 per cent) is the contribution by
traditional products. The share of ULIP funds in total investments has continued to grow in recent years reflecting the
public preference for these products.
The pattern of investments of the life insurers remained unchanged as on 31st March, 2015 when compared to 31st
March, 2014 and was in line with the prescriptions laid down by the IRDA as to the pattern of investment, under the
Investment Regulations. Central Government Securities and Approved Investments are two major avenues for parking
of funds by the life insurers.

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Investments of life insurers

INSTRUMENT-WISE (As on 31st March) (crore)
Investments from 2014 2015
Amount Percentage Amount Percentage
Traditional Products
1. Central Govt. Securities 604651 37.19 722955 38.38
2. State Govt. and other approved 333951 20.54 430554 22.84
securities
3. Housing & Infrastructure 155026 9.54 174512 9.26

4. Approved Investments 503059 30.94 530588 28.15

5. Other Investments 29118 1.79 26193 1.39

A. Total (1+2+3+4+5) 1625804 100.00 1884782 100.00

ULIP Funds

6. Approved Investments 322456 97.22 352371 97.14

7.Other Investments 9205 2.78 10369 2.86

B. Total (6+7) 331661 100.00 362740 100.00

Grand Total (A+B) 1957466 2247522

Strong state owned insurance companies contributed substantial amount of finance to government through taxes,
dividend, investments and funds to various development activities in the economy. In the privatized insurance sector
the efficiency of the insurance firms will increase and their ability to sell the products at competitive price will
improve. The profitability of insurance company is improved and hence the return to the policy holders also.

Investments of Non-Life Insurers

Non-Life insurers contributed 5 per cent of total investments made by the insurance industry. The total amount of
investments made by the sector, as on 31st March, 2015, was 1,60,714 crore (1,38,809 crore as on 31st March, 2014).

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During 2014-15, the net increase in investments by the industry stood at 20,905 crore (14.95 per cent growth over
previous year).
Investments of non-life insurers

INSTRUMENT-WISE (As on 31st March) (crore)

Pattern of Investments 2014 2015

Total % to Fund Total % to Fund
Central Govt. Securities 35877 25.66 42904 28.70
State Govt. and other approved 14328 10.25 17120 10.65
securities
Housing and Loans to State 12742 9.11 14834 9.23
Govt. for Housing & FFE
Infrastructure Investments 24544 17.56 27277 16.97
Approved Investments 49284 35.24 53734 33.43
Other Investments 3056 2.19 4845 3.01
Total 139809 100.00 160714 100.00

Note: Investments of CHNHB Association, ECGC and AIC of India have not been included.
Thus state owned insurance companies contributed substantial amount of finance to government through taxes,
dividend, investments and funds to various development activities in the economy. In the privatized insurance sector
the efficiency of the insurance firms will increase and their ability to sell the products at competitive price will
improve. The profitability of insurance company is improved and hence the return to the policy holders also.

PROFITABILITY OF LIFE AND NON-LIFE INSURERS

The nature of Insurance business is long-term and its profitability is a key issue, which depends upon many factors
(such as interest rate fluctuations, observed mortality rates, lapse rates etc.) and is measured differently. With a lot of
initial expenses, apart from the very nature of the business, insurance companies take at least a few years’ time to
reach the break-even point. Subsequent to the opening up of the insurance sector to private participation, the number
of companies continues to grow. The number of companies, which have started making profits, is also increasing,
although there is a delay in moving to positive territory, as against what was envisaged at the time of registration of

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the insurance companies with IRDA. A summary of the profitability status of the insurance companies as at the end of
2014-15 is given below separately for life and non-life companies.

Life Insurance Sector

During 2014-15, out of the 22 private life companies, seven revealed profit after tax as compared to four in the
previous two years. Out of the seven companies which reported profit in 2013-14 three companies showed profits
continuously for the last two years. It is important to note that the life insurance sector is witnessing an increasing
number of companies which are entering the positive zone. Except for the newcomers whose expense levels in the
initial years are bound to result in sizeable losses, existing insurance companies which reported losses during the year,
have been able to reduce the quantum of losses when compared to that incurred in the previous year. The sector has
been able to recover from the impact of global meltdown of the previous year (which resulted in a mere growth rate of
10.15 per cent) and has recorded a growth of 19.69 per cent during the year. Additional capital that has been injected
into the industry in 20014-15 was 2,766 crore. But, for most of the companies the expected break-even point has
shifted forward as compared to what was envisaged at the time of their application for license to underwrite insurance
business in India. Many companies achieved their targets (as set out at the licensing stage) in terms of premium
income. Although this is a welcome sign, this has its own attendant problems. Along with the premium growth,
companies had to invest in expanding their branch network and to augment their policy administration department,
underwriting department etc. Although some increase in capital expenses was seen, increase in expenses of
management, especially procurement cost of business had increased significantly. This resulted in an increase in
operating costs. Also, the companies exceeded their expected levels of management expenses per unit premium.
Expense growth rate far outweighed the premium growth rate. In addition to this, the increased lapse rates
significantly affected the premium sustainability (hence the profitability) and rendered the loadings (in the premiums)
towards the fixed per policy costs insufficient. Mortality experience has not affected the profitability of life companies
significantly as the experience has not been adverse.
Non-Life Insurance Sector
During 2014-15, out of the 13 private non-life companies, seven reported profit after tax as compared to six in 2013-
14. Out of the seven companies which were able to generate profits in 2014-15, six companies have reported profits
continuously for the last four years. The trends are similar even in case of the four Public Sector Undertakings
(PSUs). While three of the PSUs made sizeable profit after tax over the previous year, the fourth PSU recovered
considerably from the downfall experienced (losses reported) in the year 2013-14. Overall, non-life insurers have been
able to recover considerably from the immediate turbulence faced in the first full year of complete detariff regime.

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This is also reflected in the performance of the sector as a whole which recorded a growth of 13.96 per cent in the
premium income as against the growth of 9.11
per cent in the previous year. In case of non-life sector also, there is deferment of expected break-even point as
compared with the projections made in the R1 applications filed with the Authority at the time of registration.
However, the deferment was less pronounced compared to the life insurance sector. The major factors for deferment
of break-even point were increased levels of expenses and huge underwriting losses.

Role of Insurance Sector

Life Insurers transact life insurance business; the rest is transacted by General Insurers.
The business of Insurance essentially means defraying risks attached to any activity over time (including life) and
sharing the risks between various entities, both persons and organisations. Insurance companies are important players
in financial markets as they collect and invest large amounts of premium. Insurance products are multi purpose and
offer the following benefits :
1. Protection to the investors
2. Accumulate savings
3. Channelize savings into sectors needing huge long term investments.
Insurance and re-insurance play a crucial role in the development of the nation. Among others, insurance is an
important form of saving for productive use in the economy. Since an increasing proportion of life insurance business
involves pension and annuities, buying in life insurance has an element of investment decision. The saving component
and typically long-term nature of life insurance makes insurance an important instrument of mobilization of saving
specially for the projects with longer gestation and pay back period. In India, the share of life insurance as percentage
of total saving has been low but growing over a period of time. The growth of it is strategic for the country because
the country needs a huge fund for long-term investment in infrastructure.

Rise in income and savings boost insurance penetration

Over the past few years robust GDP growth in India has helped to raise the income levels as well as the savings rate.
The gross domestic savings as a percentage of GDP at current market prices increased from 34.3% in 2013-14 to
34.8% in 2014-15 mainly due to increase in savings of the private corporate sector and the public sector. In fact,
there was an increase in the share of insurance funds in the total household savings. The shift in investment

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preference was brought about by the run-up in equity markets and the flood of various ULIP products. The
contribution of banking and insurance sectors (as a component of GDP) has also seen a rise on similar lines.
When the insurance sector was opened up for private insurance companies in 1999 many players opted for JVs with
foreign players who were recognised across the globe. Over the last 8 years, consumer awareness about insurance
improved considerably. Moreover, increased competition pushed up product innovation and stepped up customer
servicing options in the sector. All these positive developments made a good impact on the economy and generated
income and employment within the sector.
Insurance is the only sector which garners long term savings
Insurers are increasingly introducing innovative products to meet the specific needs of the prospective policyholders.
An evolving insurance sector is of vital importance for economic growth. While encouraging savings habit it also
provides a safety net to both enterprises and
Individuals.
Insurance Companies receive, without much default, a steady cash stream of premium or contributions to pension
plans. Various actuary studies and models enable them to predict, relatively accurately, their expected cash outflows.
Liabilities of Insurance companies being long-term or contingent in nature, liquidity is excellent and their investments
are also long-term in nature. Since they offer more than the return on savings in the shape of life-cover to the
investors, the rate of return guaranteed in their insurance policies is relatively low. Consequently, the need to seek
high rates of returns on their investments is also low. The risk-return trade off is heavily tilted in favour of risk.
As a combined result of all this, investments of insurance companies have been largely in bonds floated by GOI,
PSUs, state governments, local bodies, corporate bodies and mortgages of long term nature.

Generates Long term funds for infrastructure and strong positive correlation between
development of capital markets and insurance/pension sector
For GDP to grow at 8 to 10%, qualitative improvement in infrastructure is essential. Estimates of funds required for
development of infrastructure vary widely. An investment of 6,19,600 crore is anticipated in the next 5 years. Tenure
of funding required for infrastructure normally ranges from 10 to 20 years. The insurance industry also provides
crucial financial intermediary services, transferring funds from the insured to capital investment, critical for continued
economic expansion and growth, simultaneously generating long-term funds for infrastructure development.
The insurance sector in India, which was opened up to private participation in the year 1999, has completed over
eleven years in a liberalized environment. With an average annual growth of 37 per cent in the first year premium in
the life segment and 15.72 per cent growth in the nonlife segment, together with the largest number of life insurance
policies in force, the potential of the Indian insurance industry is still large.
Life insurance penetration in India was less than 1 per cent till 1990-91. During the 1990s, it was between 1 and 2 per
cent and from 2001 it was over 2 per cent. In 2005 it had increased to 2.53 per cent and increased to 4.60 percent in
2009.

Spread of financial services in rural areas and amongst socially less privileged
IRDA Regulations provide certain minimum business to be done
in rural areas in the socially weaker sections
Life Insurance offices in 2015 of private insurers are 8768 and that of LIC are 3250. 72.13% of these offices are
located either in semi-urban areas or small towns. Thus the penetration of insurance sector in rural areas is increasing.

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Increase in employment opportunity

There is a probability of a spurt in employment opportunities. A number of web-sites are coming up on insurance, a
few financial magazines exclusively devoted to insurance and also a few training institutes being set up hurriedly.
Many of the universities and management institutes have already started or are contemplating new courses in
insurance. Life insurance has today become a mainstay of any market economy since it offers plenty of scope for
garnering large sums of money for long periods of time. A well-regulated life insurance industry which moves with
the times by offering its customers tailor-made products to satisfy their financial needs is, therefore, essential if we
desire to progress towards a worry-free future.

Many agents depend on insurance for their livelihood. Brokers, corporate agents, training establishments provide extra
employment opportunities. Many of these openings are in rural sectors.
Thus insurance sector play very important role in the development of India as global super power.

REFERENCES

1. Annual Report IRDA 2012-2013

2. Annual Report IRDA 2013-2014

3. Annual Report IRDA 2014-2015

4. IRDA Journal 2012-13

5. IRDA Journal 2013-14

6. IRDA Journal 2014-15

7. Kannan, N. & Thangavel, N. ‘Overview of Indian Insurance Sector’, Academic Open Internet Journal, Vol.

22, 2008.

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FM-109
ROLE OF WOMEN ENTERPRENEURS IN ECONOMIC
DEVELOPMENT AND ASSOCIATED PROBLEMS
*Rajesh Singla **Kajal Bajaj
*Associate Professor - Microbiology and Head, Agriculture Department, S.S.D. College of Professional Studies,
Bhokhra - 151201, Bathinda, Punjab, INDIA. [email protected], 9356460660.
**Assistant Professor, Commerce Department, S.S.D. College of Professional Studies, Bhokhra - 151201, Bathinda,
Punjab, INDIA.
[email protected], 8283937626.

ABSTRACT
In today’s world, women entrepreneurs are playing very vital role in economic development and they have become
important part of the global business environment and it’s really important for the sustained economic development
and social progress. In India, though women are playing key role in the society, but still their entrepreneurial ability
has not been properly tapped due to the lower status of women in the society. The main purpose of this paper is to find
out the status of women entrepreneurs in India and includes rationale ground behind the women entrepreneurship.
Another main purpose of this paper is to describe the role of women entrepreneurs in economic development, discuss
the various problems, and analyze various Indian policies for them. This paper endeavors to create awareness about
the contribution of women enterprises to the economic development and also the need for creation of a vibrant
entrepreneurial ecosystem for women entrepreneurs.
Keywords: women entrepreneurs, sustained development, enterprise, ecosystem.INTRODUCTION

Women Entrepreneurs may be defined as the women or a group of women who commence and operate a
business venture. Government of India has described women entrepreneur as an enterprise/venture owned
and controlled by women having at least financial interest of 51% of the capital and giving at least 51% of
employment generated in the organization to women. Like male entrepreneurs, they should explore the
prospects of starting new enterprise, undertake risks, introduce new innovations, coordinate, have good
administration and control of business and provide effective leadership in all aspects of business. Women
entrepreneurs are playing increased role in the economies of almost all countries.

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The entrepreneurial development process for women in India is increasingly being recognized as an important
untapped source of economic growth since women entrepreneurs create new jobs for themselves and others and by
being different also provide society with different solutions to management, organization and business problems.
Women entrepreneurs see the world through a different lens and, in turn, do things differently.
Daniel Pink’s book “A Whole New Mind” makes a case that in the twenty-first century, the most important growth
industries will be in the realms of beauty, empathy, harmony, and other aesthetic and quality of life values. He makes
the case that Asia, Automation, and Abundance will dictate this transformation. The author refers to a future in which
both the left brain (analytical) and the right brain (intuitive and holistic) will be more valued than they have been in
the past, especially when used together. It seems likely that the future will favor women entrepreneurs to a greater and
greater extent.
Even though we recognize that the journey of a woman entrepreneur is laid with huge challenges, the major one of
them is the availability of finance at different stages of the life cycle of the enterprise. We would like to study this
problem from both the demand and the supply side. This paper endeavors to create awareness about the contribution
of women enterprises to the economic development and also the need for creation of a vibrant entrepreneurial
ecosystem for women entrepreneurs. This study is primarily based on extensive secondary research and insights
drawn from own experience.
REVIEW
Entrepreneurship offers tremendous opportunities for women across the world by opening doors to greater
self-sufficiency, self-esteem, education, and growth - not only for the women themselves, but also for their
families and their employees. Worldwide, many women are entrepreneurs; between one-quarter and one-
third of the world's businesses are owned by women and they are changing the face of business ownership
internationally and as their number grow and as their businesses prosper, they will change the way the world
does business. Entrepreneurship emerges from an individual's creative spirit into long-term business
ownership, job creation, and economic security. Women bring commitment and integrity because they care
about economic empowerment, entrepreneurial development and innovation. Female entrepreneurs seek the
professional and personal support that is found in business associations. Economic globalization has
encouraged the expansion of female business ownership. The growing economic power and influence of
women-owned businesses are changing the shape of the global economy (Jalbert 2000).
Women are the Third World's powerhouse. They produce a staggering 60 percent of all food, run 70 percent
of small-scale businesses and make up a third of the official labor force - in addition to caring for families

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and homes. Yet, their status rarely reflects this enormous and vital contribution. By any measure - income,
education, health, land ownership, legal rights or political power - women get a raw deal. The poorest of the
poor are usually women because discrimination cuts off their escape routes from poverty - education, health
services, equal pay employment, access to land and finance. It is becoming increasingly clear, however, that
there will only be sustainable development in the Third World when women play an equal part in decision
making. No developing country can afford to ignore women's existing and potential economic contribution,
or their pivotal role in determining the health and welfare of a nation's children. All the evidence points to
one conclusion: economic growth and improvement in the quality of life for everyone is faster in areas
where women's status is higher (Motik, 2000).
Augmenting rates of enterprise births in local areas and the facilitation of the development of new women-
owned firms can have positive impacts on job creations, productivity growth, tax revenues, the availability
of goods and services and the provision of positive role models. Entrepreneurship among women is
important for local development and for economic development more broadly (OECD, 2003)
Setti (2004)discussed the importance of developing women entrepreneurship especially among the poor and
highlighted the potential women who need to be encouraged so that they could adopt entrepreneurial
activity. It presents the model for developing agricultural enterprise for farm women. It analysed the rural
advancement committee in providing finance to rural women and also stressed the need to focus on
marketing skills of the products produced by the entrepreneurship development programmes candidates and
self- help groups.
Jakinow (2007)stated that self-help has often perceived as a valuable element to the development
programmes. Two types of claims were made about the benefits of self-help programmes. First, it was
suggested that self-help empowered its participants more so than other externally directed or implemented
programmes. The second less local claim has the compatibility of self-help with cost-reduction strategies:
both in terms of material costs and costs to the prevailing social and economic structure. This article has
explored these two claims through a case study of a self-help group (SHG) programme in Tamil Nadu,
India. It has argued that although empowering outcomes were stated as the rationale for self-help, these
were often neglected in favour of achieving cost-reduction ones. This has an outcome of the concept of self-
help being absorbed into the practices and discourses of the dominant development paradigm. Self-help had
thus been divorced from its role in enabling self-direction, and had become the rationale for pressurizing the

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marginalised to take responsibility for improving their condition within a non-negotiable economic and
social structure.
Jaglan and Singla (2014) discussed various aspects related to women entrepreneurship which included various
enterprises, reasons for women opting entrepreneurship and problems and challenges faced by them in their paper.
They also discussed various policies of the Indian government for the development of women entrepreneurs in
MSME’s. They concluded that educational institutions play important role in inculcating managerial skills important
for business. In order to create opportunities for women traditional attitudes and mindsets of people in society needs
to be changed. Successful women entrepreneurs can act as advisors and can make new women aware and boost their
moral and confidence.
Deborah et al. (2015) in their paper said that Nigerian society expects women to be home maker and not to be
involved in entrepreneurial activities. Political, economic and social obstacles in the society have hindered many
Nigerian females to start, run and grow as successful business entrepreneurs. In their study, after interviewing two
successful female Nigerian entrepreneurs, they established that ICT does have a positive influence in tackling the
challenges faced by female entrepreneurs.
METHODOLOGY
This study is based on secondary study, taken from reputed publicated resources like various books, economic survey
and website on internet.
DISCUSSION
Women dominate the micro enterprise sector both in rural and urban areas. According to the central statistical
authority women account for close to 70 per cent of the micro enterprises in India are run by women. However, their
participation in small, medium and large enterprises diminishes. Beyond the participating in productive activities such
as agriculture, trade and industry, women have multiple roles in society. They participate in productive activities such
as agriculture; they are responsible for caring for the family including the preparation of food, health care and
education. Women need to balance this different role and therefore they are multi-tasked, managing their businesses
alongside all other roles they are expected to perform. Women account for a larger share of the informal economy
operators, as well as those running micro and small enterprises in India.
MSME‘s make a significant contribution to the socio-economic development of the country by way of supporting the
people to earn money and make a contribution to family income, and by supplying basic goods and services for local
consumption. However, this contribution is not fully recognised or understood, and there is little research or statistics
provide about understanding of women’s experience as business owners, their contribution to economic development
or the challenges they face in setting up, managing and growing their enterprise. Women entrepreneurs are often

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described as’ survivalist’ and dominate the low skill, low capital intensive and often informal and micro business.
Women tend to focus on business that is a continuation of their domestic roles, such as the service sector. The
potential for the growth of women’s enterprises is said to below and is driven less by entrepreneurial drive than the
need for survival. Women comprise 74 per cent of those employed in the micro enterprises sector. More than 65 per
cent of all women in cottage\handicraft industries (micro enterprise) were engaged in processing food products and
beverages.
ROLE OF WOMEN ENTERPRENEURS IN DEVELOPMENT
ECONOMIC CONTRIBUTION
Women’s economic activities contribute directly to growth and efficiency in dealing with informal business problems
and poverty reduction is one of the main issues for policy makers
i) Capital formation: Entrepreneurs mobilise the idle savings of the public through the issue of industrial
securities. Investment of public savings in industry results in productive utilisation of national resources. The rate
of capital formation increases, which is essential for rapid economic growth.
ii) Improvement in Per capita Income: women entrepreneurs in India have also been exploiting the opportunities
the opportunities. They convert the latent and idle resources like land, labour and capital in to national income
and wealth in the form of goods and services. They help increase the country’s net national product and per
capita which are important yardsticks for measuring the economic growth.
iii) Generation of employment: Women entrepreneur in India are playing an important role in generating
employment both directly and indirectly. By setting up small scale industries, they offer jobs to people.

SOCIAL CONTRIBUTION
Women entrepreneurs are also contributing towards improving the balanced regional development and improvement
of living standard of the country.
i) Balanced Regional Development: Women entrepreneurs in India to remove regional disparities in economic
development. They set up industries in backward areas to avail of the resources concessions and subsidies offered
by government.
ii) Improvement in living standards: With the setting up of small scale industries, reduction of scarcity of
essential commodities and introducing new products can be achieved. Women entrepreneurs in this country are
producing variety of goods on a large scale and offering them at low rates, as a result, achieving improvement in
the standard of life.

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iii)Innovation: Innovation is the key to entrepreneurship. It implies the commercial application of an invention. As an
innovator, the entrepreneur assumes the role of a pioneer and an industrial leader. Entrepreneurs have contributed
many innovations in the developing new products and in the existing products and services. All these have
resulted in economic development by way of generating employment, more income etc.
Other contributions
Women entrepreneurs are the main actresses in charging the culture of the society. In our country, women are
workaholics and participate outside the house and develop the sense of independence and the like. Thus women
entrepreneurs in our country are directly or indirectly playing an important role in environmental protection, back
ward and forward integration and are acting as charge agents, thus contributing to the economic growth of the
country.
Supportive Measures for Women's Economic Activities and Entrepreneurship
•Direct and Indirect Financial Support.
•Yojna Schemes and Programmes.
•Technological Training and Awards.
•Federations and Associations.

Direct & Indirect Financial Support

• Nationalized Banks.
• State Finance Corporation.
• State Industrial Development Corporation.
• District Industries Centers.
• Differential Rate Schemes.
• Mahila Udyug Needhi Scheme.
• Small Industries Development Bank of India (SIDBI).
• State Small Industrial Development Corporations (SSIDCs).

Yojna Schemes and Programme

• Nehru Rojgar Yojna
• Jacamar Rojgar Yojna

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• TRYSEM
• DWACRA
Technological Training and Awards
• Stree Shakti Package by SBI
• Entrepreneurship Development Institute of India
• Trade Related Entrepreneurship Assistance and Development (TREAD)
• National Institute of Small Business Extension Training (NSIBET)
• Women's University of Mumbai
Federations and Associations
• National Alliance of Young Entrepreneurs (NAYE)
• India Council of Women Entrepreneurs, New Delhi
• Self Employed Women's Association (SEWA)
• Association of Women Entrepreneurs of Karnataka (AWEK)
• World Association of Women Entrepreneurs (WAWE)
• Associated Country Women of the World (ACWW)
Others Schemes Introduced By Government
1. Micro & Small Enterprises Cluster Development Programme (MSE-CDP)
2. Credit guarantee fund scheme
3. Support for entrepreneurial and managerial development
4. Exhibitions for women under promotional package for micro & small enterprises approved by CCEA
under marketing support

Problems of Women Entrepreneurs:

There are umpteen problems faced by women at various stages beginning from their initial commencement
of enterprise, in running their enterprise. Their various problems are as follows:
1. Patriarchal Society: Entrepreneurship has been traditionally seen a male preserve and idea of women
taking up entrepreneurial activities considered as a distant dream. Any deviation from the norm is frowned

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and if possible, immediately curbed. Women also have to face role conflict as soon as they initiate any
entrepreneurial activity. It is an uphill task for women to face such conflicts and cope with the twin role.
2. Absence of Entrepreneurial Aptitude: Many women take the training by attending the
Entrepreneurship Development Programmes without entrepreneurial bent of mind. As per a study,
involvement of women in small scale sector as owners stands at mere 7 percent. Women who are imparted
training by various institutes must be verified on account of aptitude through the tests, interviews etc.
3. Quality of EDPs: All women entrepreneurs are given the same training through EDPs. Second-
generation women entrepreneurs don’t need such training as they already have the previous exposure to
business.
4. Marketing Problems: Women entrepreneurs continuously face the problems in marketing their products.
It is one of the core problems as this area is mainly dominated by males and even women with adequate
experience fail to make a dent.For marketing the products women entrepreneurs have to be at the mercy of
middlemen who pocket the chunk of profit. Although the middlemen exploit the women entrepreneurs, the
elimination of middlemen is difficult, because it involves a lot of running about. Women entrepreneurs also
find it difficult to capture the market and make their products popular.
5. Financial Problems: Obtaining the support of bankers, managing the working capital, lack of credit
resources are the problems which still remain in the males domain. Women are yet to make significant mark
in quantitative terms. Marketing and financial problems are such obstacles where even training doesn’t
significantly help the women. Some problems are structural in nature and beyond the control of
entrepreneurs.
6. Family Conflicts: Women also face the conflict of performing of home role as they are not available to
spend enough time with their families. They spend long hours in business and as a result, they find it
difficult to meet the demands of their family members and society as well. Their inability to attend to
domestic work, time for education of children, personal hobbies, and entertainment adds to their conflicts.
7. Credit Facilities: Though women constitute about 50 per cent of population, the percentage of small
scale enterprise where women own 51 percent of share capital is less than 5 percent. Women are often
denied credit by bankers on the ground of lack of collateral security. Therefore, women’s access to risk
capital is limited.

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8. Shortage of raw-materials: Women entrepreneurs encounter the problems of shortage of raw-materials.

The failure of many women co-operations in 1971 such as these engaged in basket making were mainly
because of the inadequate availability of forest-based raw materials.
9. Heavy Competition: Many of the women enterprises have imperfect organizational set up. But they have
to face severe competition from organized industries.
10. High cost of production: High cost of production undermines the efficiency and stands in the way of
development and expansion of women’s enterprises, government assistance in the form of grant and
subsidies to some extent enables them to tide over the difficult situations. However, in the long run, it would
be necessary to increase efficiency and expand productive capacity and thereby reduce cost to make their
ultimate survival possible, other than these, women entrepreneurs so face the problems of labour, human
resources, infrastructure, legal formalities, overload of work, lack of family support, mistrust etc.
Based on the factors discussed above, and coupled with the discussion on women’s contribution in business, it is
obvious that women play a tremendously important role in this matter. We could say that their contributions in
economic development are in:
 Job openings provision.
 The growth of savings, which is related to working capital.
 Increase of purchasing power that triggers the growth of consumption.
 Increase of business volume.
Although, women roles are not measurable yet in term of GDP or GNP due to the absence of gender-segregated data,
those roles are real enough and, like it or not, it certainly will continuously grow in the future. To expand the
tremendous role of women, inhibiting factors should be eliminated.

CONCLUSION
In the majority, most of the women operate their small and medium enterprises under very adverse conditions. Not
only is it difficult for them to find premises, find markets for their products, access information and credit, but they
also have limited access to training especially in the rural areas. Their educational levels are low, they are responsible
for all the domestic chores and they have to seek permission from their family members to travel to trade fairs or for
training, even if they do want to grow their enterprises. Women entrepreneurs need to be better organised into
entrepreneurship which help them identify higher potential business, opportunities, develop markets for their
products, improve product quality and marketing skills.

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REFERENCES
Deborah, M.B., Adebisi, O.O. and Oluremi, O.A. (2015).ICT and Gender Specific Challenges Faced by
Female Entrepreneurs in Nigeria.International Journal of Business and Social Science.6(3): 97-105.
Jaglan, R. and Singla, R. (2014). Challenges Faced by Women Entrepreneurs in MSME’s. In: MSME’s in
Punjab- Opportunities & Challenges, 156-161. Tanghi, P.K. and Garg, N. (Editors), First edition
published by Twenty First Century Publications, Patiala, # 79, Sheikhpura, P.O. Punjabi University,
Patiala (PB) – 147002.
Jalbert, S.E. (2000). Women Entrepreneurs in the Global Economy (Ph.D. Thesis).
Motik, S. (2000).Significant Roles of Women Entrepreneurs in Economic Development.Women Leaders
Network (WLN) Meeting.
Setti, T.D. (2004).Clinical Approach to Promotion of Entrepreneurship among Women(New Delhi: Anmol).
T. Jakinow (2007).“The Rationale of Self help in Development Intervention A case study of a Self Help Group
Programme in Tamil Nadu”. Journal of South Asian Development.2(1): 107 – 204.
http://www.dcmsme.gov.in/schemes/
www.google.co.in
www.india.gov.in
www.msme.gov.in/
www.oecd.org
www.publishyourarticles.org

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FM-110
ENTERPRENEURSHIP AND ECONOMIC DEVELOPMENT - TWO
SIDES OF THE SAME COIN
*Rajesh Singla ** Laghima Sharma
*Associate Professor - Microbiology and Head, Agriculture Department, S.S.D. College of Professional Studies,
Bhokhra - 151201, Bathinda, Punjab, INDIA. [email protected], 9356460660.
**Assistant Professor, Commerce Department, S.S.D. College of Professional Studies, Bhokhra - 151201,
Bathinda, Punjab, INDIA. [email protected], 8699219690.
ABSTRACT
Entrepreneurship and economic development are intimately related. Schumpeter opines that entrepreneurial process is
a major factor in economic development and the entrepreneur is the key to economic growth. Whatever be the form of
economic and political set-up of the country, entrepreneurship is indispensable for the economic development. Small
entrepreneurship has a fabulous potential in a developing country like India. It is very important for the sustained
economic development and social progress for the developing countries like India. The entrepreneur who is a business
leader looks for ideas and puts them into effect in fostering economic growth and development. Entrepreneurship is
one of the most important inputs in the economic development of a country. An entrepreneur acts as a trigger head to
give spark to economic activities by his entrepreneurial decisions. He plays a pivotal role not only in the development
of industrial sector of a country but also in the development of farm and service sector.This paper focuses upon
connection between entrepreneurship and economic growth is that these previously unnoticed profit opportunities
must come from somewhere, and the most common source of profit opportunities is the insights of other
entrepreneurs.
KEYWORDS: Entrepreneurship, economic growth, development, social progress.

INTRODUCTION
One of the most important goals of contemporary economics is determining the factors that cause economic
growth. Traditional neoclassical theory holds that the economic growth of a country is determined not only
by the supplies of both labour and capital that the country possesses but also by the level of technology
present in that country. The role of entrepreneurship in economic development varies from economy to
economy depending upon its material resources, industrial climate and the responsiveness of the political

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system to the entrepreneurial function. The entrepreneurs contribute more in favourable opportunity
conditions than in the economies with relatively less favourable opportunity conditions. The
underdeveloped regions, due to the paucity of funds, lack of skilled labour and non-existence of minimum
social and economic overheads, are less conducive to the emergence particularly of innovative entrepreneurs
(Todaro and Smith, 2008).
The important role that entrepreneurship plays in the economic development of an economy promotes
capital formation by mobilizing the idle saving of the public. It provides immediate large-scale employment.
Thus, it helps reduce the unemployment problem in the country, i.e., the root of all socio-economic
problems. It promotes balanced regional development. It helps reduce the concentration of economic power.
It stimulates the equitable redistribution of wealth, income and even political power in the interest of the
country. It encourages effective resource mobilization of capital and skill which might otherwise remain
unutilized and idle. It also induces backward and forward linkages which stimulate the process of economic
development in the country. Last but not the least, it also promotes country’s export trade which is an
important ingredient to economic development.
Global development is entering a phase where entrepreneurship will increasingly play a more important
role. There are at least three reasons for this, each particular to certain types of countries. Firstly, in the
West, the managed economy of the 1970s-2000s, characterized by reliance on big business and mass
production, has given way to a so-called entrepreneurial economy. Here knowledge-driven goods and
services are now more flexibly provided by smaller firms, and the emergence of a creative class requires a
less interfering but more facilitating state. Secondly, in the emerging countries, most notably the BRICs –
Brazil, Russia, India, China, impressive growth has been driven by a veritable entrepreneurial revolution.
The need in these economies to sustain growth is through sustainable access to resources, knowledge,
markets, and low-carbon industrialization puts a premium on innovative entrepreneurship. Finally, in the
least developed countries, where aid dependency is high, donors have been shifting the emphasis in
development cooperation towards private sector development. In many of these countries, including
resource-poor North African countries, populations consist of many young people who see little prospects of
gaining employment with decent wages. Promoting youth entrepreneurship here has become a vital policy
objective of many development organizations and donors. Thus, it is clear that entrepreneurship serves as a
catalyst of economic development. On the whole, the role of entrepreneurship in economic development of

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a country can best be put as “An economy is the effect for which entrepreneurship is the cause” (Caree and
Thurik, 2010).
This paper will provide evidence that entrepreneurship should be included as an important cause of
economic growth independent of the other factors. We present the analysis of the relevant empirical results
and possible directions for future research.
REVIEW
Kirzner (1973) views the entrepreneur as someone who facilitates adjustment to change by spotting opportunities for
profitable arbitrage (and ‘disequilibrium’ situations in the market). This view has resonated among scholars who
emphasize the opportunity-grabbing for profit nature of entrepreneurship particularly in developing countries where
market disequilibria may be common. Behavioural definitions also stress the risk-taking dimension of
entrepreneurship.
Kanbur (1979) described the entrepreneur as one who ‘manages the production function’ by paying workers wages
(which are more certain than profits) and shouldering the risks and uncertainties of production. Such definitions are
seen as very relevant for developing country contexts characterized by high risk and uncertainty. The predominance of
small firms in developing countries - the bulk of entrepreneurship studies in developing countries are concerned with
small and medium enterprises (SMEs) - has been postulated to be a symptom of economy-wide uncertainty, where the
probability of success is small.
Policy implications follow from these views, for instance that government policy for promoting entrepreneurship
should reduce uncertainty and transaction costs. Policy though, is only a proximate cause for risk and uncertainty and
in recent years development scholars have recognized ‘institutions’ (the “rules of the game”) as the ultimate
determinant of development. Institutions affect not only the supply but, perhaps even more importantly, the allocation
of entrepreneurship. According to Baumol (1990) entrepreneurial ability can be allocated towards productive,
unproductive, or even destructive activities. He defines entrepreneurs as ‘persons who are ingenious and creative in
finding ways that add to their own wealth, power, and prestige’. Underdevelopment is not due to an insufficient
supply of entrepreneurs, but due to institutional weaknesses that result in a “lack of profit opportunities tied to
activities that yield economic growth” (Coyne and Leeson, 2004).
Smith (2010) in his study confirmed that the level of entrepreneurship in a given country has a significant positive
effect on the level of economic growth in that country. Contrary to some established theories, his study has found
evidence that the level of entrepreneurship in a given country is not explained by the levels of the traditional causes of
economic growth in that country (specifically the amounts of labour, capital, and knowledge that a country possesses

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as well as the presence or absence of market friendly government policies). Instead, entrepreneurship acts as an
independent factor.
Schumpeter famously defined the entrepreneur as the coordinator of production and agent of change (‘creative
destruction’). As such, entrepreneur is above else an innovator. Scholars who share this view of entrepreneurship do
not consider entrepreneurship to be very important in earlier stages of economic development – they see the
contribution of entrepreneurship to be much more important at later stages of development, where economic growth is
driven by knowledge and competition. At earlier stages of development, entrepreneurship may play a less pronounced
role because growth is largely driven by factor accumulation. Other behavioural definitions allow for a more
substantial role for entrepreneurship in developing countries (Acs and Naude, 2013).
Entrepreneurs are people who create new businesses and help in creating new jobs for people. They help in
intensifying competition, with the help of technology they master in increasing productivity and thus contribute in the
development of the country, followed by economic growth. So, it can be said that entrepreneurship is good for
economic growth. Their paper justifies how far this stands true in reality. Now, if the entrepreneurship allows
informal self employment which means without formally creating new business then it could be assumed that high
levels of entrepreneurship would correlate with sluggish economic growth and sheathing development. Their study
further mentions findings of a survey known as “Global Entrepreneurship Monitor (GEM) project” which is related to
understand how different types of entrepreneurship affect development of the country. They collected secondary data
available and literature previously studied. The data analyzed revealed that effects of necessity and opportunity
entrepreneurship on economic growth and development vary greatly. The study concluded that necessity
entrepreneurship bears no effect on economic development and opportunity entrepreneurship has a positive and
significant effect (Shrivastava and Shrivastava, 2013).
Toma et al. (2014) in their paper highlighted several dynamic forces, such as technological disruption, fluctuating
economies or demographical changes, have brought new opportunities and threats for organizations, and transformed
societies from all over the world. In order to cope with these shifting forces, governments, public and private
organizations, and the public are more and more aware of the importance of entrepreneurship. Entrepreneurship is a
multifaceted phenomenon, being analysed as a process, a resource or a state-of-being. Entrepreneurial process
constitutes one of the key factors in the economic development of a country/region. However, researchers have
expressed different views about the relationship between the stages of economic development and entrepreneurship
during the time. The aim of their paper is to examine in brief the concepts of economic development and
entrepreneurship, and to emphasize the role of entrepreneurship in economic development. The methodological
approach is literature review. Their paper provides a theoretical model that highlights some of the main factors

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involved in the relationship between entrepreneurship and economic development. More than ever in the history,
economic development and entrepreneurship have become strongly interconnected.
METHODOLOGY
This study is based on secondary data taken from the reputed resources like various books and economic survey
reports as well as articles. Also, some research papers has been included along with various search engines through
the websites on internet.
DISCUSSION
Entrepreneurs are frequently thought of as national assets to be cultivated, motivated and remunerated to the greatest
possible extent. Entrepreneurs can change the way we live and work. If successful, their innovations may improve our
standard of living. In short, in addition to creating wealth from their entrepreneurial ventures, they also create jobs and
the conditions for a prosperous society. The following are six reasons why entrepreneurs are important to the
economy.
Entrepreneurs Create New Businesses
Path breaking offerings by entrepreneurs, in the form of new goods and services, result in new employment, which
can produce a cascading effect or virtuous circle in the economy. The stimulation of related businesses or sectors that
support the new venture adds further to the economic development. For example, a few IT companies founded the
Indian IT industry in the 1990s as a backend programmer’s hub. Soon, the industry gathered pace in its own
programmer’s domain. But more importantly, millions from other sectors benefited from it. Businesses in the
associated industries like call center operations, network maintenance companies and hardware providers, flourished.
Education and training institutes nurtured a new class of IT workers offering better, high-paying jobs. Infrastructure
development organizations and even real estate companies capitalized on this growth as workers migrated to
employment hubs seeking new improved lives. Similarly, future development efforts in underdeveloped countries will
require robust logistics support, capital investment from buildings to paper clips and a qualified workforce. From the
highly qualified programmer to the construction worker, the entrepreneur enables benefits across a broad spectrum of
the economy.
Entrepreneurs Add to National Income
Entrepreneurial ventures literally generate new wealth. Existing businesses may remain confined to the scope of
existing markets and may hit the glass ceiling in terms of income. New and improved offerings, products or
technologies from entrepreneurs enable new markets to be developed and new wealth created. Additionally, the
cascading effect of increased employment and higher earnings contribute to better national income in form of higher
tax revenue and higher government spending. This revenue can be used by the government to invest in other,

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struggling sectors and human capital. Although, it may make a few existing players redundant, the government can
soften the blow by redirecting surplus wealth to retrain workers.
Entrepreneurs Create Social Change
Through their unique offerings of new goods and services, entrepreneurs break away from tradition and indirectly
support freedom by reducing dependence on obsolete systems and technologies. Overall, this results in an improved
quality of life, greater morale and economic freedom. For example, the water supply in a water-scarce region will, at
times, force people to stop working to collect water. This will impact their business, productivity and income. Imagine
an innovative, automatic, low-cost, flow-based pump that can fill in people's home water containers automatically.
Such an installation will ensure that people are able to focus on their core jobs without worrying about a basic
necessity like carrying water. More time to devote to work means economic growth.
Community Development
Entrepreneurs regularly nurture entrepreneurial ventures by other like-minded individuals. They also invest
in community projects and provide financial support to local charities and this enables further development
beyond their own ventures. Some famous entrepreneurs, like Bill Gates, have used their money to finance
good causes, from education to public health. The qualities that make one an entrepreneur are the same
qualities that motivates entrepreneurs to pay it forward.
The Role of States
Regulations play a crucial role in nurturing entrepreneurship, but regulation requires a fine balancing act on
the part of the regulating authority. Unregulated entrepreneurship may lead to unwanted social outcomes
including unfair market practices, pervasive corruption, financial crisis and even criminal activity.

CONCLUSION
Reconsidering entrepreneurship’s role in development leads to three novel realizations. First, it provides fresh
perspectives in development economics. Second, Impact evaluation (or attribution analysis): what happened with the
programme compared to what would have happened in the absence of the programme. Entrepreneurship influences
development outcomes positively as well as negatively. Third, entrepreneurship is in turn significantly determined by
the dynamics of development. Entrepreneurship is therefore a valid and important subject of study for development
scholars, and development is a worthwhile subject of study for entrepreneurship and management scholars. The
growing availability of more and better data from emerging and developing economies, the increasing adoption of

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rigorous evaluation methods in policy assessments, and likelihood and desirability of closer collaboration across
disciplines, are all boding well for the intersection of development and entrepreneurship.

REFRENCES
Acs, Z.J. and Naude, W.A. (2013). ‘Entrepreneurship, Stages of Development, and Industrialization’ In: Pathways to
Industrialization in the 21st Century, Chapter 14. Szirmai, A., Naude, W.A. and Alcorta, L. (Eds.). Oxford:
Oxford University Press).
Baumol, W.J. (1990). ‘Entrepreneurship: Productive, Unproductive and Destructive’.The Journal of Political
Economy.98(5): 893-921.
Carree, M. A. and Thurik, A. R. (2010).The Impact of Entrepreneurship on Economic Growth. In: “Handbook of
Entrepreneurship Research”, Acs, Z. J., Audretsch, D. B. (Eds.). Springer Science+Media, New York.557-594.
Coyne, C.J. and Leeson, D.T. (2004).‘The Plight of Underdeveloped Countries’.Cato Journal.24(3): 235-49.
Kanbur, S.M. (1979). ‘Of Risk-Taking and the Personal Distribution of Income’.Journal of Political Economy.87(4):
769-97.
Kirzner, I.M. (1973). Competition and Entrepreneurship. Chicago: University of Chicago Press. 246.
Shrivastava, S. and Shrivastava, R. (2013).Role of Entrepreneurship in Economic Development With
special focus on necessity entrepreneurship and opportunity entrepreneurship.International Journal of
Management and Social Sciences Research.2(2): 1-5.
Smith, D. (2010). The Role of Entrepreneurship in Economic Growth.Undergraduate Economic Review.6(1): Article
7.
Todaro, M.P. and Smith, S.C. (2008).Economic Development. 10th ed. Boston, MA: Addison Wesley (Eds.).
Toma, S.G., Grigore, A.M. and Marinescu, P. (2014).Economic development and entrepreneurship (1st International
Conference 'Economic Scientific Research - Theoretical, Empirical and Practical Approaches', ESPERA
2013).Procedia Economics and Finance.8: 436-443.

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FM-111
IPO Performance and Sensex – A Comparative Analysis of Five Sectors
* Dr. Pritpal Singh Bhullar ** Ms Anantdeep Kaur *** Ms Samandeep Kaur
*Assistant Professor, Deptt of Humanities & Mgmt Studies, GZSCET Bathinda
**Assistant Professor, Deptt of Humanities & Mgmt Studies, GZSCET Bathinda
***Assistant Professor, Deptt of Humanities & Mgmt Studies, GZSCET Bathinda

ABSTRACT
Initial Public Offer (IPO) plays a role of new blood in the nerves of firms as the firms try to raise funds for their
forthcoming ventures through IPOs. This paper examines the one year performance of IPOs launched by various
companies during year 2008 to year 2011. The study comprises a comparative analysis of the performance of the IPOs
in terms of average return, volatility to that of Sensex pertaining to the five sectors (Infrastructure, IT, Financial
Services, Pharmaceuticals and Energy Sector) of Indian economy. Statistical technique like standard deviation has
been used to calculate volatility of Sensex as well as stocks. The study has been done to analyse the factors affecting
the performance of IPOs. Attempt has been made to weigh the macro as well as micro economic factors and also
market trend during the specified period. Grading of IPO done by various credit rating agencies as well as market
volatility during the specified time has also been taken into consideration for the purpose of the study. The
quantitative and graphical analysis on the basis of IPO grading and volatility of one year post issue stock performance
with Sensex for same period i.e. year 2008-year 2011 of five sectors has been done. The analysis also highlights the
relationship between IPO grading of stock and stock volatility.

Keywords – IPO performance, Stock Average return, Stock Volatility, Sensex Average return, Sensex Volatility,
Standard deviation, Trend Analysis

Introduction
An IPO acts the same way for company as blood acts for a human body. Through IPO companies can estimate their
brand value in investors mind. Undervalue and overvalue of IPO depends upon the investors perception about a
company’s performance and its future. Credit rating agencies also plays a vital role, as they assign ratings to the IPO
of company on the basis of various criteria including fundamental factors, past performance, future prospects.
However, once the company is listed, its performance is affected by various factors. The volatility of company’s share
varies with volatility of various macro and micro economic factors. Factors like globalization, liberalization and
privatization, have made the economies dependent on each other. Political instability and fragile economic, crisis in
any part of world have direct or indirect effect on the performance of economic sectors of home country. Martani et al
(2004) investigates the factors affecting the performance of IPOs in manufacturing companies of Indonesia from 1994

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to 2006. The result shows a positive association between company size and initial return. Positive association was
found between underpricing and earning persistence only in one period after IPO. Hani and Gregor (2008) analyze the
performance of IPOs of 237 firms. They find that excess demand of stock leads to underpricing of IPOs. Sahoo and
Rajib (2010) empirical investigates 172 companies issued during 2002-2007. The results find that P/E ratio, reputation
of investment bank, offer price affects the post listing performance of stock. Titan (2012) investigates 120 companies
for a time period of 2002-2012 listed at LSE. The result gives the hint that Age of firm, Return on Assets and
Reputation of investment banks does not have significant relation with performance of IPO. In this research paper,
IPO’s of companies, between 2008 and 2012, associated to five crucial sectors of the Indian economy have been
considered. Their one year performance as well as volatility has been compared to performance and volatility of
Sensex for the same period. Various micro and macro economic factors have also been pointed out which were
supposedly the cause of major fluctuation in the stock market on particular day.

Research Methodology
Following types of statistical techniques are used :

Volatility - To calculate volatility of stocks first we find ln (P2/P1) for entire closing stock price. Then we calculate
Standard deviation for all the resulted values of step I
Where P2 – Today’s closing price P1 – Yesterday’s closing price Ln – natural log

Return – One year return of companies as well as Sensex has been calculated by following formula:
((Today’s closing price – Yesterday’s closing price) / Yesterday’s closing price)*100
Trend Analysis - To compare the trend analysis of performance of five sectors and Sensex we get a graphical
representation of average return from all sectors and Sensex. It
shows the trend in performance of these sectors and in Sensex.

Infrastructure Sector
Company return vs Sensex return

Name Time period Company return Sensex

(1st day closing & 1 Return
year closing)

J Kumar Infra projects Ltd. 12/2/2008 - 12/2/2009 -39.39 -43

KNR Infra projects 12/2/2008 - 12/2/2009 -76.42 -50.04
IRB Infra projects 25/2/2008 - 25/2/2009 -47.18 -45.22
Gammon Infrastructure 3/4/2008 - 2/4/2009 -65.17 -34.63
MBL Infrastructure Ltd. 11/1/2010 - 11/1/2011 -4.47 9.52

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DB Realty Ltd. 24/2/2010 - 24/2/2011 -74.29 8.46

ARSS Infrastructure 3/3/2010 - 3/3/2011 -18.01 8.76
Man Infra construction 11/3/2010 - 11/3/2011 -58.89 5.86
Nitesh Estate 13/5/2010 - 13/5/2011 -45.63 7.32
Jaypee Infratech 21/5/2010 - 20/5/2011 -42.22 11.43
Ramky Infrastructure (8/10/2010 - 7/10/2011 -47.01 -19.84
Commercial Engineers and 18/10/2010 - 18/10/2011 -64.63 -16.95
Bodybuilders Co Ltd.
Oberoi Realty Ltd. 20/10/2010 20/10/2011 -17.14 -14.77
Prestige Estates Projects 27/10/2010 28/20/2011 -48.48 -10.99
RPP Infra projects 6/12/2010 - 7/12/2011 -10.15 -15.53
Table 1

Graph - 1

Graph - 2

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The infrastructure companies launching their IPOs between 2008-2012 gave a gloomy picture for their first year
performance. DB realty’s first year performance was the worst (-74.29%). During the same time sensex gave +8.46%
return. Companies like Gammon Infrastructure which was assigned IPO grade 4 by credit rating agency CARE
showed the highest volatility of 4.23% among all infrasrructure companies. Companies which were assigned IPO
grade 2, 3 and 4 gave average volatility of 3.42%, 3.32% and 3.21%. The difference is minor. So as higher IPO
grade represents strong fundamentals of company but here in infrastructure companies with strong
fundamentals gave a high volatility as compared to sensex also.The main reason of such performance was increase
in key policy retaes by RBI, increase in the price of raw materials resulting in increase in the price of residentials flats
and a resultant decrease in demand.

Energy Sector
Company return vs Sensex return

Name Time Period Company Return (1st Sensex

day closing & 1 year Return
closing) (%) (%)
Reliance Power 11/2/2008 - 11/2/2009 -72.42 -42.16
Adani Power 20/8/2009 - 20/8/2010 39.73 22.57
NHPC 1/9/2009 - 1/9/2010 -17.03 17.07
Oil India 30/9/2009 - 30/9/2010 11.93 17.17
JSW Energy 4/1/2010 - 4/1/2011 -1.23 16.74
SJVN 20/5/2010 - 20/5/2011 -15.17 10.93
Orient Green Power Company 8/10/2010 - 7/10/2011 -66.48 -19.84
Coal India Ltd. 4/11/2010 - 4/11/2011 -4.67 -15.94

Table - 2

Graph – 3

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Graph – 4

Among energy companies, Adani power (39.73%) and Oil India(11.93%) gave higher return to investors within first
year of launching their IPOs where as Reliance power gave th worst return (-72.42%) among all energy companies
within same period. Except for Reliance Power (IPO grade 4 and Volatility 5.21%) all other energy companies
experienced less volatility with higher IPO grade. All the companies represented nearly same volatility as per Sensex
except Reliance Power and Orient Green Power Company. The major reasons of fall in share price of Reliance Power
was that on 29h May 2008. Company issued Bonus share of 3:5. On 30th may 2008, the share price of Reliance Power
came at Rs 235.85 from a closing price of Rs 409.55 on 29th May 2008. On 24th Octobe 2008, as Sensex also fell
down to 10%, Reliance Power share price fell from Rs 106.85 to Rs 96.85 same day.

Pharmaceutical Sector
Company return vs Sensex return

Name Time Period 1st day closing & 1 year Sensex (%)
closing (%)
Bafna Pharmaceutical 26/6/2008 - 26/6/2009 -34.32 2.377
Syncom Healthcare 15/2/2010 - 15/2/2011 -61.3 13.938
Parabolic Drugs 1/7/2010 - 1/7/2011 -36.81 7.158
Claris Lifesciences 20/12/2010 - 20/12/2011 -48.94 -23.7
Aanjaneya LifecareSystems 27/5/2011 - 28/5/2012 75.99 -10.124
Brooks Laboratories Ltd. 5/9/2011 - 5/8/2012 -69.35 6.072
Table - 3

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Graph – 5

Graph – 6

Most of the Pharmaceutical Companies gave less than expected results. Their share price fell down within the first
week of their IPO. The main reason was that all the companies have IPO grade 2 which is a symbol of weak
fundamentals. That’s why all companies showed high volaility as compared to Sensex volatility.

IT Sector
Company return vs Sensex return

Name Time Period Company return (1st day Sensex Return

closing & 1 year closing) (%) (%)
GSS America Info Tech 7/3/2008 - 6/3/2009 -78.6 -41.78
Edserv Soft system 2/3/2009 - 2/3/2010 92.29 84.99
Excel Info ways 3/8/2009 - 3/8/2010 -48.2 13.75
Think soft Global Services 26/10/2009 - 26/10/2010 -30.31 8.87
Infinite Computer Solutions 3/2/2010 - 3/2/2011 -7.57 11.84
Persistent System 6/4/2010 - 6/4/2011 -0.38 9.31
Intra soft Technologies 12/4/2010 - 11/4/2011 -56.95 7.89

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Career Point Info system 6/10/2010 - 7/10/2011 -60.71 -20.98

Acropetal Technologies 10/3/2011 - 9/3/2012 -85.27 -4.49
Bharatiya Global Info media 28/7/2011 - 27/7/2012 -80.68 -7.52
Table – 4

Graph – 7

Graph – 8
Edserve softsystems offered best return within first year of launching of its IPO . It was even higher than Sensex
return for the same period. Infinite computer solutions wasexceptional as even it was assigned IPO grade 2 but it
offered volatility in first year less than companies that were assigned IPO grade 3. IT sector companies show high
volatility than Sensex for the same period . The main reason of high volatility in IT sector companies was weak US
economy, Euro debt crisis, Rupee depreciation etc.

Financial Services
Company return vs Sensex return

Name Time Period Company Return (1st Sensex

day closing & 1 year Return (%)
closing) (%)

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Future Capital Holdings 1/2/2008 - 2/2/2009 -13.01 -84.76

SKS Microfinance 16/8/2010 - 16/8/2011 5.08 -70.88
Microsec Financial Services 5/10/2010 - 5/10/2011 -17.91 -73.76
PTC India Financial Services 30/3/2011 - 30/3/2012 -11.07 -35.94
Muthoot Financial Services 6/5/2011 - 7/5/2012 -2.08 -33.39
Future Venture India 10/5/2011 - 10/5/2012 -12.63 5.3
L&T Financial Holdings 12/8/2011 - 13/8/2012 -2.06 -11.31
Table – 5

Graph – 9

Graph - 10

Due to US recession, the performance of financial sector was below par. Most of the companies gave negative return
of below 10%. Only SKS Microfinance gave positive return of around 5.08% irrespective of return of Sensex. Some
companies showed high volatility even they have high IPO grade.

Trend Analysis

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Graph - 11

If we analyze trend analysis of all sectors and Sensex then we can see that IT sector performance was worst. The
average return of IT sector was -35.63% whereas for the same period average return of Sensex was +6.18 %. The
above trend can be seen in Energy sector, but was better than IT sector as the difference between average return of
energy sector companies and Sensex is least than other sectors The above trend analysis shows that during that period
investment would have been much safer than investment in any other sector.

Macro-economic factors
On June 30th, 2010 Indian stock market gained as European banks obtained loan from their central bank and gradually
the financial health of euro zone sector became better. RBI had to tighten its monetary policy, as on 25th June, 2010,
Indian Government hiked the petrol price, diesel price, kerosene oil price and LPG price. Indian IT Sector stock price
fell as US economy doomed further.
October 2010 was month of positive rally in the stock market as the purchase made by FII’s was of Rs 11,215 crore.
Energy companies gave better results in that quarter.
On November 24th, 2010, share price of Indian construction and real estate companies fell because loan scam was
disclosed. IT stocks crashed due to fragile US economy
On February 9th, 2011, FIIs sold stocks worth Rs 609 crore whereas they invested only Rs 115 crore in Indian stocks.
The total outflow of foreign funds touched a significant figure of Rs 10,740 crore within starting months of yea 2011.
Due to increase in key policy rates by RBI in starting months of year 2011, Interest rate increased.
On 9th February 2011, 2G scam was unearthed in India which affected the sentiments of Indian investors. Due to high
interest cost, property cost and decrease in demand of residential units, the share price of real estate stocks crashed.
On February14th, 2011 US stock market and other major economies of world gained as Egyptian President resigned
that reduced the political unrest around the region.

Conclusion
In nutshell we can say that Euro debt crisis, Political unrest in Egypt, US’s fragile economy, increase in commodity
prices were the major global factors that dent the performance of different Indian sectors during the study period.
Indian factors which affected the performance were food inflation, hike in oil prices, increase in policy rates by RBI,
FII flow in stock market, Rupee depreciation, financial scams and sentiments of Indian investors etc.

References

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1) Sahoo, Seshadev; and Rajib, Prabina (2010), “After Market Pricing Performance of Initial Public Offerings
(IPOs): Indian IPO Market 2002-2006”, Vikalpa, 35(4), pp 27-43.

2) Vichakorn Chiraphadhanakul, Kennedy D Gunawardana (2005) The factors affecting on IPO return in Thai
Stock Market, Special Issue of the International Journal of the Computer, the Internet and Management, Vol.
13 No.SP2 October, 2005

3) www.chittorgarh.com/ipo/ipo_detail.asp?a=274

4) http://capitalmarket.webtutorials4u.com/home/2010/06/market-review-30th-june-2010/

5) http://www.bseindia.com/markets/equity/EQReports/StockPrcHistori.aspx?flag=0&expandable=6

6) http://www.ijcim.th.org/SpecialEditions/v13nSP2/pdf/p19.16%20The%20Factors%20Affecting%20on%20IP
O%20v.2.pdf

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FM-112
Women Entrepreneurs in MSMEs and Obstacles in Their Way

*VIJAY LAXMI (Research Scholar)

*Assistant Professor in Management S.S.D. Women’s Institute of Technology, Bathinda

E-mail: [email protected]

Mobile No. 9855012021

Abstract:
Entrepreneurship is seen as one of the most important solutions to unemployment, poverty and low economic growth.
For a nation where the only identity of a woman some time back used to be that of a homemaker, hogging the
corporate limelight has been a journey to empowerment and strength. There can be many reasons for women to
become entrepreneurs such as need of self fulfillment and self identity, additional income and a better social status.

The glass ceilings are shattered and women are found indulged in every line of business from papad to power
cables.Contribution of women in economic development of the country is unquestionable but despite their positive
influence on global prosperity, they remain a misunderstood segment of the business world. Women have to face
numerous problems in business. Male chauvinism is still dominant in society although constitution provides equal
rights to women.

Key Words: women entrepreneurs, MSME’s, growth factors and obstacles.

Introduction:
Entrepreneurship requires an application of energy and passion towards the creation and implementations of new and
creative ideas. With the advent of media, women are aware of their own traits, rights and also the work situations.
Active and enthusiastic women entrepreneurs can explore the potentials of the available resources such as labor,
capital and technology. Women tend to be great networkers, have inherent skills for negotiating, and the ability to
multi-task..

MICRO, SMALL &MEDIUM ENTREPRISES:-

In accordance with the provision of Micro, Small & Medium Enterprises Development (MSMED) Act, 2006 the
Micro, Small and Medium Enterprises (MSME) are classified in twoClasses:

(a) Manufacturing Enterprises- The enterprises engaged in the manufacture or production of goods pertaining to
any industry specified in the first schedule to the industries (Development and regulation) Act, 1951). The
Manufacturing Enterprise is defined in terms of investment in Plant&Machinery.

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(b) Service Enterprises: The enterprises engaged in providing or rendering of services and are defined in terms of
investment in equipment.

The limit for investment in plant and machinery / equipment for manufacturing / service enterprises, as
notified, vide S.O. 1642(E) dtd.29-09-2006 are as under:

Manufacturing Sector

Enterprises Investment in plant & machinery

Micro Enterprises Does not exceed twenty five lakh rupees

Small Enterprises More than twenty five lakh rupees but does not exceed
five crore rupees

Medium Enterprises More than five crore rupees but does not exceed ten crore
rupees

Service Sector

Enterprises Investment in equipments

Micro Enterprises Does not exceed ten lakh rupees:

Small Enterprises More than ten lakh rupees but does not exceed two crore
rupees

Medium Enterprises More than two crore rupees but does not exceed five core
rupees

The office of Development Commissioner (MSME), Ministry of Micro, Small & Medium Enterprises, Government of
India.

Female participation in the workforce was less than 40 percent in 1960 but is predicted to reach 62 percent by the year
2015 as per U.S. Department of Labor statistics. Priority for implementation of programmes under agricultural and its
allied activities of diary farming, poultry, animal husbandry, handlooms, handicrafts and small scale industries,
etc.were given to women entrepreneurs.

Business schools are also spreading awareness about entrepreneurship development programmes. As a result of this
professional education, industrialisation, urbanisation and democratic values awareness, the tradition bound Indian
society has undergone a change and women entrepreneurs have shifted their entrepreneurial activities to engineering,
electronics, eco-friendly technology IT enabled enterprises. Event management, tourism industry, fashion industry,
food , fruits &vegetables processing, herbal &health care are also a part of it.

Review of Literature:

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Government of India has given a broader definition of the term women entrepreneur. It defined women entrepreneur
as "an enterprise owned and controlled by women having a minimum financial interest of 51% of the capital and
giving at least 51% of the employment generated in the enterprise to women".

C.K.Kalbagh 1992 “Inspite of the fact that women in developing countries are massively involved in areas such as
agriculture, food, production, trades etc. Their work is not fully recognized and valued.”The contribution of women in
informal sectors is almost ignored. Women working in organized sector don’t have access to credit, appropriate
technical information, training and policy supports.

Kamal Naser, Wojoud Rashid Mohammed, RanaNuseibeh (2000), in their research study entitled “Factors that
affect women entrepreneurs: evidence from an emerging economy” had found that Financial support from the
government especially in the start-up capital is an important factor that motivates women to establish their own
businesses. Self-fulfillment, knowledge, skills and experience, including relationship to spouse/father business, are all
important factors in the development of women entrepreneurs. Unlike previous research factors such social norms,
market network, and competition do not seem to be barriers for women in becoming entrepreneurs.

Karim (2001) on women entrepreneurs in Bangladesh, financial problems were the most common problems faced by
their women entrepreneurs. Inadequate financing was ranked first, particularly so in rural areas and among small
economic units (fewer than 5 workers), all the more so with those located in the household and unregistered sectors.
Competition, obtaining quality raw materials, and balancing time between the enterprise and the family were ranked
as major start-up problems.

Kimathi (2009) emphasized that small businesses were held back by tough local conditions some of them were
unable to raise huge collaterals demanded by banks as a condition to access loans.

Siwadi and Mhangami (2011) added that it is undeniable that women entrepreneurs are the major actors in that
sector and contributors to economic development and are becoming increasingly visible in the local economies of the
developing counties. Promoting women’s economic and political empowerment has gained greater attention over the
last three decades.

Goyal , Meenu and Prakash Jai (2011) studied the concept of women entrepreneurs – reasons for becoming
entrepreneurs and reasons for slow progress of women entrepreneurship in India . According to them , more women
opt to leave corporate world to chart their destinies .Major barriers encountered by them are stiff competition with
male entrepreneurs, their personal and family obligations , absence of family support and from outside agencies , high
production cost , lack of awareness about financial assistance in the form of loans ,incentives etc.

Devi, Anjali and Goswami,Gayatri (2014) Traced the development of women entrepreneurs in Assam and also found
the problems faced by them. The problems were categorized as Socio –personal, Financial, Skill & Training,
Marketing and Infrastructural. In spite of various schemes offered by the government entrepreneurship development
among the women was not much encouraging.

RESEARCH METHODOLOGY: -

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The following research methodology has been used:

1. Formulation of the research problem: Research problem is the study of reasons for becoming women
entrepreneurs and problems faced by them in MSMEs.

2. Research Design: Descriptive research design is used.

3. Sources of data: Secondary data sources such as books, magazines, journals and websites were referred for in
depth understanding of various reasons for and obstacles in the way of women entrepreneurs.

FACTORS RESPONSIBLE FOR THE GROWTH OF WOMEN

ENTREPRENEURSHIP
Many women start a business due to some traumatic event such as divorce, discrimination due to pregnancy or the
corporate glass ceiling, the health of a family member, or economic reasons such as a layoff. A sense towards
independent decision-making on their life and career is the motivational factor behind this urge. Under the influence
of these factors the women entrepreneurs choose a profession as a challenge and as an urge to do something new.
Today innumerable women are filling colors of success in their life and moving a step closer to their dreams of being
self dependent. Many of them are entering the corporate field as financial advisors, investment bankers, chartered
accountants etc. and doing their job with unmatched excellence.

The factors can be categorized as push and pull factors.

Escape from previous job, opportunity, support from family, recognition from others, unemployment,
underemployment and unsatisfactory work conditions are some push factors which are compelling reasons for women
to be self-employed.

Desire to be independent, achievement, financial benefits and the desire to be one’s own boss are few factors which
have pulled women into their own business.

Obstacles in the way of women entrepreneurs in MSMES:

Various factors creating obstacles in the growth of women entrepreneurs are as under:-

Lack of education and confidence: Most of the women in India are illiterate. Those who are educated are provided
either less or inadequate education than males. Due to lack of proper education, women entrepreneurs remain in dark
about the development of new technology, new methods of production, marketing and other governmental support .

Inefficient use of new technology: They are ignorant of new technologies or unskilled in their use, and often unable
to do research..Although great advances are being made in technology; but lack of access to technical training prevent
the technology from being beneficial or even available to females.

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Low risk-bearing capacity:Lack of education, training and financial support from outsides also reduce their ability
to bear the risk involved in an enterprises. Investing money, maintaining the operations and ploughing back money for
surplus generation requires high risk taking attitude, courage and confidence. Though the risk tolerance ability of the
women folk in day-to-day life is high compared to male members, while in business it is found opposite to that.

Limited managerial ability: Women have to depend on office staffs and intermediaries, to get things done,
especially, the marketing and sales side of business. Here there is more probability for business fallacies like the
intermediaries take major part of the surplus or profit.

Shortage of raw materials:The scarcity of raw materials, sometimes non, availability of proper and adequate raw
materials sounds the death-knell of the enterprises run by women entrepreneurs. Women entrepreneurs really face a
tough task in getting the required raw material and other necessary inputs for the enterprises when the prices are very
high.

Shortage of finance: The women entrepreneurs are suffering from inadequate financial resources and working
capital. The women entrepreneurs lack access to external funds due to their inability to provide tangible security. Even
financial institutions discourage women entrepreneurs on the belief that they can at any time leave their business and
become housewives again. The result is that they are forced to rely on their own savings, and loan from relatives and
family friends.

Stiff competition: women entrepreneurs face severe competition from industry . They employ low technology in the
process of production. In a market where the competition is too high, they have to fight hard to survive in the market
against their male counterpart who have vast experience and capacity to adopt advanced technology in managing
enterprises

Too much legal formalities: Legal formalities required for running an enterprise becomes difficult task on the part
of a women entrepreneur becauseof the prevalence of corrupt practices in government offices and procedural delays
for various licenses, electricity, and water and shed allotments.

Family responsibilities: Women are over burden with family responsibilities like extra attention to husband,
children and in laws which take away a lots of their time and energy. In such situation, it will be difficult to
concentrate and run the enterprise successfully.

Male dominated society:

Even though our constitution speaks of equality between sexes, male chauvinism is still the order of the day.
Women are not treated equal to men. Their entry to business requires the approval of the head of the family.

Recommendations:
To reduce the bottlenecks following suggestions are recommended

Capacity building and training workshops must be increased to support women in functional areas such as finance,
literacy skills, marketing, production and managerial skills.

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Full support and encouragement of their spouse in respect of finances, advice and actual involvement in the running of
business.

Easy access to credit by women entrepreneurs should be facilitated through innovative programs and financing
arrangements.

Micro finance institutions should portray a non gender based environment in order to stimulate women entrepreneurs.

Women entrepreneurs should be taught on the value of being independent. This will stimulate them to do things on
their own like acquiring property.

To provide young women a chance for creativity and innovation technical knowledge must be provided.

CONCLUSION:
To empower the entrepreneurs in particular women, to grow their enterprises the Government and the private sector
are doing various efforts. Formal financial support is provided by commercial Banks, Non Governmental
Organizations, Microfinance Institutions by forming Self help groups.

REFERENCES :
Bhanu Shali S. G. ( 1987) Entrepreneurship Development Himalya Publishers New Delhi.

Candid Brush and Others ( 2004) Clearing the Hurdles: Women Building High Growth Business, Financial Times:
Upper Saddle River, New Jersey: Prentice Hall.

Chatterjee ,R. & Heuer ,M(Eds.)., Management in India. New Delhi: Response Books

Devi, Anjali and Goswami, Gayatri.Women Entrepreneurship Development in Assam with special reference to
Kamurp District, India , The Clarion : International Multidisciplinary Journal , Vol 3,No. 1(2014),pp149-156

Dhameja, S.K. (2001).Women entrepreneurs, New Delhi: Deep and Deep Publications (P) Ltd.

Goyal,Meenu and Prakash Jai.Women Entrepreneurship in India – Problems and Prospects, Zenith International
Journal of Multidisciplinary Research, Vol 1, No. 5( Sep 2011), pp195-207

Gupta M.C. ( 1987) Entrepreneurship in Small Scale Industries, Anmol Publications New Delhi

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Green, E. & Cohen, L. (1995). Women’s business: Are women Entrepreneurs Breaking New Ground or simply
Balancing the Demands of women’s work in a new way? Journal of Gender studies, Vol.4 no. 3

Gupta, A., Koshal, M. & Koshal R. (2006). Women managers in India: Challenges and opportunities.

Hisrich & Brush (1986).Women and minority Enterpreneurs.A comparative analysis. Frontiers of Entrepreneurship

Jose P., Ajith Kumar. & Paul T.M., (1994) Entrepreneurship Development, Himalaya PublishingNapasari .K.S. (
1977) Women Executives Rawat Publications, Jaipur.

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IT-151
Exercising Big Data in Indian Election Scenario via competent Technologies
*
Dr.Gagandeep Jagdev **Amandeep Kaur
Dept. of Computer Science, Research Scholar (Ph.D Comp. App.)
Punjabi University Guru Kashi College Guru Kashi University
Damdama Sahib (PB). Talwandi Sabo (PB).
[email protected]@gmail.com
Contact No. – 0950104190

Abstract
Data is not a new term in the field of computer science, but Big Data is essentially a new word. When data
grows beyond the capacity of currently existing database tools, it begins to be referred as Big Data. Big
Data posses a grand challenge for both data analytics and database. It has been only in 2013 to 2015 that
we humans have created 90 percent of data existing on the planet earth since existence of humans on this
planet. The huge technological up gradation in social network, in retail industry, in health sector, in
engineering disciplines, in the field of wireless sensors, in stock market, in public and private sector, all has
collectively amassed enormous data. This data is very huge in volume, it gets created at very high speed, it
may be structured, unstructured, semi-structured or may be in text, audio or video format and most
important that it is not totally precise and can be messy or misleading. The central theme of my research
work is concerned with handling huge amount of data that is concerned with different formats of elections
that are been contested in India. I have initially limited my database only to Punjab state. It is no more a
hidden fact that in future elections will be fought on the basis of statistics and figures and not on the basis of
caste and religion. To support this fact we can consider the examples of 2014 Lok Sabha elections in which
BJP gained total majority and Mr. Narendra Modi became Prime Minister of India and then later in Bihar
in 2015 where Nitish Kumar registered a huge victory against the same BJP. All these results are inspired
by making the best use of data related to past elections and targeting the voters. I have created a structured
database in the form of MS-Excel file which includes thirteen different attributes providing information
related to different candidates who have contested MP elections in different districts of Punjab state. These
attributes are candidates name, political party to which they belong, there assets, there liabilities, criminal
cases registered on them, number of votes obtained, percentage of votes obtained, chances of winning next
elections etc. In this research work of mine I have opted for Apache Hadoop framework for mining and

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extracting relations from my database. Apache Hadoop framework makes use of Map-Reduce technology
which operates in three steps: mapping, shuffling and reduction. Map reduce is the same technique which
Facebook use for handling its section of “People you may know”. The objective behind this research work
of mine is to assist common electorates of Punjab state to take best decision on the basis of previous track
record of politician or political party and decide who to vote for to get better governance.
Keywords- Big Data, Elections, Hadoopframework, Map Reduce.

I. INTRODUCTION
Internet is the major source which has resulted in the tsunami of data in the past few years. Big data is
too big, it moves too fast, and doesn’t fit the structures of our existing database architectures. It is like an
ocean of data in which we people swim in every day with an effort to come on the surface, but every day the
level of data increases tremendously. Gone are the days when memory was used to be measured in
Gigabytes or Terabytes or Petabytes, today it is measured in exabytes, zettabytes or yottabytes. With Big
Data solutions, organizations can dive into all data and gain valuable insights that were previously
unimaginable. The term “big data” can be pretty nebulous, in the same way that the term “cloud” covers
diverse technologies. Utilizing big data requires transforming information infrastructure into a more
flexible, distributed, and open environment.
Big data promises deeper insights that data scientists are highly involved in exploring this data in such a
manner that organizations are benefited to its best with total customer satisfaction. Big data analytics is one
of the great new frontiers of IT. Emerging technologies such as the Hadoop framework and MapReduce
offer new and exciting ways to process and transform big data—defined as complex, unstructured, or large
amounts of data—into meaningful insights, but also require IT to deploy infrastructure differently to support
the distributed processing requirements and real-time demands of big data analytics [3, 4].
II. ISSUES RELATED WITH BIG DATA CHARACTERISTICS

Data Volume – It refers to the enormous amount of data that is been created each second, each minute
and each hour of the day. 571 websites are created in a single minute. Total of 625000 GB of data is
transferred from one end to another in single internet minute, may be terms of mails, pictures, posts etc. If
we burn the amount of data present on planet earth today on DVDs and pile them in the form of a stack one

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upon another, the pile will be such huge that one can climb it and touch the moon, come back to earth and
again repeat this process once.
Data Velocity – Data is being created at such high velocity that companies are finding it difficult to cope
up with such high speed. They have to establish their infrastructure in such a manner that it is capable of
handling such generated data Social media, E-Commerce has rapidly increased the speed and richness of
data used for different business transactions.
Data Variety - All the data being generated is totally diverse consisting of raw, structured, semi
structured and even unstructured data which is difficult to be handled by the existing traditional analytic
systems. Mismatched data formats and data structures represent significant challenges that can lead to
analytic collapse.
Data Value –There is a huge gap in between the business leaders and the IT professionals. The main
concern of business leaders is to just add value to their business and to maximize their profit. On the other
hand, IT leaders deal with technicalities of the storage and processing.
Data Complexity – The biggest complexity faced while running big data using relational databases is
that they require parallel software running on hundreds of servers and data scientists have to match and
transform data across systems coming from various sources.
Data Veracity -Veracity refers to the preciseness of data or how much faith one can have on data. The
data on internet is not always accurate or precise. For example, if some male pretends himself as a female
on his facebook profile, there is no authenticity check in such cases. Similarly twitter makes use of
abbreviations and hash tags, but big data enables us to work with even this type of imprecise data [1, 6].
III. FIVE PHASES OF BIG DATA

Big data processing involves five different phases [2, 6, 7].

Data Acquisition and Recording – Big data definitely have some source of origin. It is not created from
a vacuum. Different scientific experiments being carried out in the world today produces petabytes of data
per day. Much of this data is of no use and has to be filtered out. The first challenge faced is to set filtering
parameters as such that useful data doesn’t gets discarded. For example, suppose one sensor reading differs
substantially from the rest: it is likely to be due to the sensor being faulty, but how can we be sure that it is
not an artifact that deserves attention? We need research in the science of data reduction that can
intelligently process this raw data to a size that its users can handle while not missing the needle in the

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haystack. The second challenge encountered is related to automatically generating right metadata to
illustrate what data is recorded, how it is recorded and measured.
Information Extraction and Cleaning– It is mention able here that information collected is not in an
analysis ready format. For example, consider the collection of electronic health records in a hospital,
comprising transcribed dictations from several physicians, structured data from sensors and measurements,
and image data such as x-rays. The data in this format cannot be effectively analyzed. An information
extraction process should be applied to such data to pull out the required information from the sources under
consideration and present it in a structured format suitable for analysis. This is really a big challenge. This
data may include images and videos and such extraction is highly application dependent.
Data Integration, Aggregation, and Representation – It is not enough to merely collect record and
throw the data into a repository. If we have large data sets in repository, then it will be almost impossible for
the user to find the desired data when required. But with sufficient amount of metadata there is some hope
but still challenges persists due to differences in experimental details and in data record structure. Data
challenging is much more than simply locating, identifying, understanding and citing data. All this process
needs to occur in a complete automated manner for an effective large scale analysis. Suitable database
design is most important. There are many different ways in which data can be stored. Certain designs will be
better than others for certain purposes and possibly may carry drawbacks for other purposes. Therefore it
can be concluded that database design is an art and needs to be carefully executed by trained professionals.
Query Processing, Data Modeling, and Analysis Methods for querying and mining – There is no
doubt in the fact that big data is diverse, imprecise and unstructured. Even then big data is of much value as
compared to small individual observations as general statistics obtained from large sample are more precise.
When it comes to mining, it requires clean and efficiently accessible data. Provision should be there for
declarative query and mining interfaces. Efficient mining algorithms and computing environments is
another important requirement.
Interpretation – The analysis of big data remains of no value if users are not able to understand the
analysis concept. Decision maker is provided with the result of analysis and is expected to interpret these
results. This interpretation requires efforts. It involves deeply examining all the assumptions made and
retracing the analysis. There are several sources of errors like system may carry bugs and conclusions may
be based on error prone data. No responsible user will yield authority to computer system for all this.

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Instead one will try to understand and verify the results produced by computer system. All this should be
made easy by computer system and this is a big challenge with big data due to its complexity.

IV. ELECTIONEERING - USING BIG DATA IN ELECTIONS IN INDIA

One method for predicting the results of upcoming elections is via exit poll. The most valuable
information regarding campaigns and their affect on general public is provided by citizens themselves. Data
analysts develop models based on this information and perform predictions regarding winning and losing
chances of any political party and any political leader. If such results are properly harnessed, they could
gain sizeable gains. Elections in India have always comprised issues based on caste, religion, sentiments,
traditional wisdom, opinion polls and rallies. But 2014 Lok Sabha elections witnessed the use of technology
to its very best by political parties. All this idea was actually borrowed by the way Barack Obama contested
his elections in America and raise to power in 2008 and 2012.
In an extraordinary attempt to engage digitally literate electorates of India, Google and some other
social platforms started a forceful digital information campaign.Google India launched one such hub
related to elections where electorates can search for political candidates, political parties, and election
platforms and voting related information in their regions. They even launched one site on the counting date
which updated about live status of results on the day of counting. It was revealed that Narendra Modi
consistently topped the search trends when compared to other candidates [14].
For conducting 2014 Lok Sabha elections, 543 Parliamentary constituencies and 4120 assembly
constituencies were set up. All over India total of 9 lakh 30 thousand polling booths were set up for
conducting fair elections. Voter rolls were prepared in 12 different languages and total of 9 lakh pdf files
which amounted to 2.5 crore pages were deciphered. The real challenge was extraction of voter info from
these 2.5 crore PDF pages and transliteration of the same into English to fuse with other sources.
Technology was a big hurdle.
Behavior scores use past behavior and demographic information to calculate explicit probabilities that
citizens will engage in particular forms of political activity. The primary outcomes campaigns are
concerned with include voter turnout and donations, but other outcomes such as volunteering and rally
attendance are also of interest.

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Support scores predict the political preferences of citizens. In the ideal world of campaign advisers,
campaigns would contact all citizens and ask them about their candidate and issue preferences. However, in
the real world of budget constraints, campaigns contact a subset of citizens and use their responses as data
to develop models that predict the preferences of the rest of the citizens who are registered to vote. These
support scores typically range from 0 – 100 and generally are interpreted to mean “if you sample 100
citizens with a score of X, X percent would prefer the candidate/issue”. A support score of “0” means that
no one in a sample of 100 citizens would support the candidate/issue, “100” means that everyone in the
sample would support the candidate/issue, and “50” means that half of the sample would support the
candidate/issue. Support scores only predict the preferences at the aggregate-level, not the individual-level.
That is, people with support scores of 50 are not necessarily undecided or ambivalent about the
candidate/issue and, in fact, may have strong preferences. But when citizens have support scores of 50, it
means that it is difficult to predict their political preferences [15, 16].
Responsiveness scores predict how citizens will respond to campaign outreach. While there are
theoretical rationales as to who might be most responsive to blandishments to vote and attempts at
persuasion, in general, predicting which individuals will be most and least responsive to particular direct
communications in a given electoral context is difficult. Campaigns can use fully randomized field
experiments to measure the response to a campaign tactic. The results of these experiments can then be
analyzed to detect and model heterogeneous treatment effects (i.e., predictive scores) that guide targeting
decisions. Some of the results of these experiments can only be used to inform decisions in future elections
(e.g., the results of most voter turnout experiments necessarily come after Election Day), but others can be
conducted during the election cycle to improve efficiency in real time [15, 16].

V. TECHNOLOGIES HANDLING BIG DATA

A. MPP – Massively Parallel Processing

Massive Parallel Processing (MPP) is the “shared nothing” approach of parallel computing. It is a type of
computing wherein the process is being done by many CPUs working in parallel to execute a single
program. One of the most significant differences between a Symmetric Multi-Processing or SMP and
Massive Parallel Processing is that with MPP, each of the many CPUs has its own memory to assist it in

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preventing a possible hold up that the user may experience with using SMP when all of the CPUs attempt to
access the memory simultaneously (Fig. 1).

MPP databases use multi-core processors, multiple processors and servers, and storage appliances equipped
for parallel processing. That combination enables reading many pieces of data across many processing units
at the same time for enhanced speed. This method is necessary because the frequencies of processors are
hitting the limits of the technologies used and are slow to increase [14].

Massively parallel processing (MPP) is a form of collaborative processing of the same program by two
or more processors. Each processor handles different threads of the program, and each processor itself has
its own operating system and dedicated memory. A messaging interface is required to allow the different
processors involved in the MPP to arrange thread handling. Sometimes, an application may be handled by
thousands of processors working collaboratively on the application.

The Massively Parallel Processing relational database architecture spreads data over a number of
independent servers, or nodes, in a manner transparent to those using the database. Big Data environments
often use analytic MPP systems usually called “shared-nothing” databases. In this the nodes that make up
the cluster operate independently and communicate via a network but do not share disk or memory
resources. With modern multi-core CPUs, MPP databases can be
configured to treat each core as a node and run tasks in parallel on a single server [15, 16].

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Fig. 1 Working of SMP AND MPP

B. Hadoop and Map Reduce

Hadoop [11, 12] is a java based framework that is efficient for processing large data sets in a distributed
computing environment. Hadoop is sponsored by Apache Software Foundation. The creator of Hadoop was
Doug Cutting and he named the framework after his child’s stuffed toy elephant. Applications are made run
on systems with thousands of nodes making use of thousands of terabytes via Hadoop. Distributed file
system in Hadoop facilitates fast data transfer among nodes and allows continuous operations of the system
even if node failure occurs. This concept lowers the risk of disastrous system failure even if multiple nodes
become inoperative. The inspiration behind working of Hadoop is Google’s Map reduce which is a software
framework in which application under consideration is broken down into number of small parts [5, 6].
Hadoop is a framework which comprised of six components shown in Fig. 2[4].

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Fig. 2 Hadoop Zoo

 HDFS – HDFS are distributed cages where all animals live i.e. where data resides in a distributed
format.

 Apache HBase – It is a smart and large database.

 Zookeeper- Zookeeper is the person responsible for managing animals play.

 Pig – Pig allows playing with data from HDFS cages.

 Hive- Hive allows data analysts play with HDFS and makes use of SQL.

 HCatalog helps to upload the database file and automatically create table for the user.

MapReduce [8] is a framework originally developed at Google that allows for easy large scale
distributed computing across a number of domains. The Apache Hadoop software library is a framework
that allows for the distributed processing of large data sets across clusters of computers using simple
programming models. It is designed to scale up from single servers to thousands of machines, each offering
local computation and storage. Hadoop MapReduce includes several stages, each with an important set of
operations helping to get to your goal of getting the answers you need from big data. The process starts with
a user request to run a MapReduce program and continues until the results are written back to the HDFS.
The working of Map Reduce technology is shown in Fig. 3.

Fig. 3 Working of Map Reduce Technology

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MapReduce is an architectural model for parallel processing of tasks on a distributed computing system.
This algorithm allows splitting of a single computation task to multiple nodes or computers for distributed
processing. As a single task can be broken down into multiple subparts, each handled by a separate node, the
number of nodes determines the processing power of the system. There are various commercial and open-
source technologies that implement the MapReduce algorithm as a part of their internal architecture. A
popular implementation of MapReduce is the Apache Hadoop, which is used for data processing in a
distributed computing environment. As MapReduce is an algorithm, it can be written in any programming
language [15, 16].

The initial part of the algorithm is used to split and 'map' the sub tasks to computing nodes. The 'reduce' part
takes the results of individual computations and combines them to get the final result. In the MapReduce
algorithm, the mapping function reads the input data and generates a set of intermediate records for the
computation. These intermediate records generated by the map function take the form of a (key, data) pair.
As a part of mapping function, these records are distributed to different computing nodes using a hashing
function. Individual nodes then perform the computing operation and return the results to the reduce
function. The reduce function collects the individual results of the computation to generate a final output [14,
16].

VI. CONCLUSION
The next elections may be path breaker in the way it’s fought. It could turn into a massive data gathering
work out where unique databases (for e.g. voter registration, social media, subscription data, transaction
profile, mobile records, television viewership and channel bouquet, work profile, location, etc.) will be
integrated together and analyzed with eagerness to find correlations and patterns. It has been analyzed that
about 160 million of those who are not sure about who to vote could be targeted through mobile phones and
about a 100 million through television. These people are waiting to hear the right message to make that
choice of which party to vote for and may be the right message is hidden somewhere waiting to be
uncovered. So, it can be concluded that big data analytics could act as a key to reveal the winning mantra
which could get a political party their major win [8].
It can be concluded that big data is all set to play a major role in any national elections to be conducted
in future. Political parties have to concentrate on the use of technology much more than other matters.

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Appropriate use of big data guarantees the big win of the political parties [16].
REFERENCES
[1] Laney, Doug. 2012. “3D Data Management: Controlling Data Volume, Velocity and Variety.”
[2] Information Week. 2012. “Big Data Widens Analytic Talent Gap.” Information Week April.
[3] Heudecker, Nick. 2013. “Hype Cycle for Big Data.” Gartner G00252431
[4] Edala, Seshu. 2012. “Big Data Analytics: Not Just for Big Business Anymore.” Forbes.
[5] Dean, Jeffery, and Ghemawat Sanjay. 2004. “MapReduce: Simplified Data Processing on Large
Clusters.” Google.
[6] Kaisler, S., Armour, F., Espinosa, J. A., & Money, W. (2013). Big Data: Issues and Challenges
Moving Forward. International Conference on System Sciences (pp. 995-1004). Hawaii:IEEE
Computer Soceity.
[7] Katal, A., Wazid, M., & Goudar, R. H. (2013). Big Data: Issues, Challenges, Tools and Good
Practices. IEEE, 404-409.
[8] Gagandeep Jagdev et. al.,” Scrutinizing Elections Strategies by Political Parties via Mining Big
Data for Ensuring Big Win in Indian Subcontinent”, 4th Edition of International Conference on
Wireless Networks and Embedded Systems.
[9] http://hadoopilluminated.com/hadoop_illuminated/Intro_To_Hadoop.html#d1575e686
[10] http://hadoop.apache.org/docs/r1.2.1/ hdfs_design.html
[11] http://searchdatamanagement.techtarget.com/definition/MPP-database-massively-parallel-processing-
database
[12] http://www.slideshare.net/rupenmomaya/big-data-insights-challenges
[13] http://www.salient.com/docs/books/SALIENT_MPP.pdf
[14] Dr. Gagandeep Jagdev et. al., “Big Data commence a new Trend for Political Parties to
Contest Elections in Indian Subcontinent” at National Conference FPIIT-2015 at D.A.V.
College, Abohar, Punjab.
[15] Dr. Gagandeep Jagdev et. al., “Big Data proposes an innovative concept for contesting
elections in Indian subcontinent”, IJSTA Volume 1, Issue 3,pp. 23-28, 2015, ISSN No. 2454-
1532.

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[16] Gagandeep Jagdev et. al., “Big Data sets novel drift for contesting elections in India” at
National Conference RTEST-2016, Rayat-Bahra University, Mohali, ISBN – 978-93-8493582-5.

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IT-152

A Study of Changes in Information Technology Sector in India

Ms Inderjit Kaur
Assistant ProfessorAkal Group of Technical and Management InstitutionsMastuana Sahib
Phone no: 9888821909Email id: [email protected]

Ms Jashandeep Kaur
Assistant ProfessorAkal Degree CollegeMastuana Sahib
Phone No: 9888488400Email id: [email protected]

Ms Veerpal Kaur
Assistant ProfessorAkal Degree CollegeMastuana Sahib
Phone No: 9779815100Email id:veerpal [email protected]

Abstract
Information Technology has become a backbone of the economic development of any country. Since last
one decade, a significant transformation has been witnessed in Informational sector. The growth in Service
industry, Banking Industry and other economic sectors has been catalysed the new developments in
Information Technology. Substantial incremental value has been created in terms of not only job creation
but it has also raised the living standard of future generation. This research paper is an attempt to highlight
the major developments in IT Sector. This paper will provide conceptual foundation for the researchers to
dive little deeper and explore the future research areas.
Introduction
Change can be defined as the process of being different. Change management is an approach to
shifting/transitioning individuals, teams, and organizations from a current state to a desired future state. It is
an organizational process aimed at helping change stakeholders to accept and embrace changes in their
business environment. Kotter defines change management as the utilization of basic structures and tools to
control any organizational change effort. Change management's goal is to maximize an organization's
benefits and minimize the change impacts on workers and avoid distractions.

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The Information technology industry in India has gained a brand identity as a knowledge economy due to its
IT and ITES sector. The IT–ITES industry has two major components: IT Services and business process
outsourcing (BPO). The growth in the service sector in India has been led by the IT–ITES sector,
contributing substantially to increase in GDP, employment, and exports. The sector has increased its
contribution to India's GDP from 1.2% in FY1998 to 7.5% in FY2012.[1] According to NASSCOM, the IT–
BPO sector in India aggregated revenues of US$100 billion in FY2012, where export and domestic revenue
stood at US$69.1 billion and US$31.7 billion respectively, growing by over 9%.[1] The major cities that
account for about nearly 90% of this sectors exports are Bangalore,
Chennai, Delhi, Mumbai, Hyderabad, Pune, Kolkata and Coimbatore. Export dominate the IT–ITES
industry, and constitute about 77% of the total industry revenue. Though the IT–ITES sector is export
driven, the domestic market is also significant with a robust revenue growth.[1] The industry’s share of total
Indian exports (merchandise plus services) increased from less than 4% in FY1998 to about 25% in
FY2012. According to Gartner, the "Top Five Indian IT Services Providers" are Tata Consultancy
Services, Infosys, Cognizant, Wiproand HCL Technologies.[2]
This sector has also led to massive employment generation. The industry continues to be a net employment
generator, expected to add 230,000 jobs in FY2012, thus providing direct employment to about 2.8 million,
and indirectly employing 8.9 million people. Generally, a dominant player in the global outsourcing sector,
however, the sector continues to face challenges of competitiveness in the globalize world, particularly from
countries like China and Philippines. India's growing stature in the Information Age enabled it to form close
ties with both the United States of America and the European Union. However, the recent global financial
crisis has deeply impacted the Indian IT companies as well as global companies. As a result hiring has
dropped sharply, and employees are looking at different sectors like the financial service,
telecommunications, and manufacturing industries, which have been growing phenomenally over the last
few years.
IT-enabled services such as back office operations, remote maintenance, accounting, public call centres,
medical transcription, insurance claims, and other bulk processing are rapidly expanding. Today, Bangalore
is known as the Silicon Valley of India and contributes 33% of Indian IT Exports. Such is the growth in
investment and outsourcing; it was revealed that Cap Gemini will soon have more staff in India than it does
in its home market of France with 21,000 personnel+ in India.

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Review of Literature
In 2001 when the world economic forum first published its The Global Information and Technology Reports
(GITR), the .dot com bubble had just burst and the there were fewer than 20 million mobile phones but
today there are more than 500 million mobile phones subscribers in Africa only . Despite the strides the
sector has made since 2001-the dot com burst, it is only the beginning of impact of digitization, creating
substantial incremental value in terms of not only job creation and economic growth but also of societal well
being and government transparency (Mainardi, 2012). ICT will significantly reduce geographic or other
limitations allowing people around the globe to communicate and share information and ideas freely. Smart
devices, cloud computing, super broadband will impact the daily life of individuals. Subscribers will not
have to wait to download videos, pictures or other data files from the network. The benefits will also make
people’s lives much more convenient as ICT technologies are applied to building e-governance models and
building e-commerce, e-learning, and online medical services as well as other web based intelligent
services. The operational efficiency will significantly improve in organisations applying ICT(Dutta Bilbao-
Osorio, 2012).
Objectives of the study
1. To identify the types of changes in the information technology sector.
2. To study the impact of the changes on the IT companies.

Methodology
The paper focuses on the changes that Information and technology sector will face in the coming years. The
study of these changes is important as it will help us to understand the impact of these changes on the
various aspects of human life starting from the impact on organisations to society at large. Therefore, the
paper which is descriptive in nature is largely based on the review of reports, research papers, white papers
and articles published by experts on websites and job portals to help us identify the changes in IT sector and
their impact.
Changes in the Global Information Technology
The most significant change that increasing digitisation has brought is that it has lead to convergence of (IT)
and (CT) into ICT. ICT will significantly reduce geographic or other limitations allowing people around the
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globe to communicate and share information and ideas freely. In this integrated and interwoven world, ICT
will contribute greatly to a variety of fields such as medical care and environmental protection. ICT and
relevant technological innovations will propel global economic growth further than ever before. (Yafang,
2012) All countries from Europe, Africa, and Asia to the United States have come to realise that an
integrated ICT will enhance the competitiveness and creativity.
All the countries have been unveiling their innovative strategies around ICT industry to make it “enabler”
for future economic growth. Improving ICT can help solve the issues through cloud computing to reduce
costs when the world is becoming flat, and the organisations are operating in broad customer base and
complex environments. The challenges for ICT globally will be with respect to lack of unified technical
standards, lack of connections among cloud computing, telecommunications network (the pipe) and smart
devices. Overcoming these obstacles will be a top priority and change factor. Moreover, security, cyber
crime, privacy, the flow of personal data, individual rights and access to information will also be some
challenges which need to be catered.(Biggs, Johnson, Lozanova Sundberg, 2012)Traditional organisations
and industry infrastructures are also facing challenges as industries converge. Theconvergence of
information and technology sector will gain momentum due to the following reasons:
THE CLOUD: A CATALYST FOR ICT CONVERGENCE
Cloud computing is internet based computing, whereby shared resources, software and information are
provided to computers and other devices on demand, like electricity grid.
The IT and telecommunications industries will converge for cloud services. In addition to providing
bandwidths for cloud services, telecommunications carriers will gradually move their IT systems, value-
added services, and Internet data centres into the cloud to provide services to a variety of industries. To
integrate their services successfully, telecommunications and IT industries will seek a common
understanding on standards, interfaces, and security specifications. Most important will be the unification of
industry standards. Uniform standards will significantly drive down the cost of the cloud, making
interconnection a reality and facilitating its rapid development. Cloud services, such as e-government, e-
education, and e-healthcare, will be able to better cater to the needs of governments, industries, and
enterprises(Huang, Gug, Xie, Wu, 2012).
Impact of Changes in Information Technology on Business

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1. The cloud computing will help in Creation of new generation products and services. Many business
ideas that required prohibitive amounts of computing power, scale, or radically new business models but
couldn't be implemented due to existing technical limitations or cost-effectiveness, can now be realized.
Every improvement in storage, processing power, or technology enables innovations that weren't
possible before (high speed Internet, for instance, made products like You-Tube possible) and cloud
computing makes these opportunities unusually accessible. Smart companies will take notice.
2. New forms of partnership and outsourcing with IT suppliers which will enable companies the choice of
changing or cancelling at the end of the month if services are not to their satisfaction.
3. It will usher in the Web 2.0 era and bring in challenges in scale, performance, and satisfying fickle
audiences of millions has created technologies, solutions, and architectures that can address them in
powerful yet economic ways that many enterprise systems are finding hard to match. When cloud
computing is adopted by an organization, they will find themselves thrown into the pool with the rest of
the online world in many ways, whether this is the employment of social tools, SaaS, non-relational
databases or a host of other technologies in their new cloud. And in the end, this will serve them very
well and allow many companies to acquire the skills and perspectives required to compete effectively in
the 21st century.
4. The traditional SOA will give way to new model where it will meet new business and technical
requirements, faster rates of changes, and new business conditions.
5. New generations of companies and vendors which will lack the baggage of existing leaders and bring in
new sensibility(radical openness and transparency, new technologies, and Web-focus)
6. Cloud computing will bring in increasing independence of users as Many cloud solutions, particularly as
they relate to SaaS, will require increasingly less and less involvement from the IT department. Business
users will be able to adopt many future cloud computing solutions entirely using self-service.
7. Prototyping and market validation of new products and services will be faster and cheaper as there will
be fewer technical and economic barriers. Cloud computing is so accessible that many new internal
entrepreneurs (see previous point) will use the tools to create new solutions anyway.
8. The heavier dinosaur organisations will find it difficult to compete in modern business environment and
will have trouble keeping up more nimble adopters and fast-followers.

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9. Social media will be the new big data source.Consumers can now talk to each other, criticize or
recommend products, share feedback with their own chosen providers.
10. Our hyper connected world driven by data has rewritten the rules for patient centric healthcare.
Technology will provide remote doctors, remote sensors; video, virtual access to patient records will
change the medical field(Hag storm, Gill, 2012)
11. Creating intelligent intersections between businesses and customers. With a social media analytics
solution, this company can now understand its customers’ shopping experiences, using data that extend
far beyond its basic website metrics (e.g., page views and transactions). Analysts now have real-time
analysis of what current and potential customers are expressing about the company’s brand, products,
and services through various social media outlets (Face book, Twitter, etc.). The result is a
comprehensive understanding of what customers are saying, the sentiment behind their messages, and
emerging trends and preferences.
For many organizations in the short term the apparent potential of the individual changes above will often
not be sufficient to them to make the transition to cloud computing, particularly as the cloud market is so
new and major players such as IBM and HP have yet to arrive in full force. But gaining competency in
cloud computing today by conducting pilots and building skills will server companies well and begin to
position them for the future IT landscape.(Dion Hinchcliffe, 2012) Longer term, cloud computing is
increasingly appearing to be a transformative change in the business landscape.
Impact on the Changes on the Learning and Development Needs in the IT Companies
The bulk of IT skills remain relevant in a cloud environment. Cloud computing promises new career
opportunities for IT professionals. In many cases existing core skills transfer directly to cloud technologies.
In other instances IT pros need to develop new skill sets that meet the demands of emerging cloud job roles.
Companies that consider moving to cloud computing will want to educate their IT professionals about the
potential opportunities ahead so that they can build their staff skills and capabilities ahead of these changes.
Let’s look at those skills which need to be cultivated as per the new jobs. System configuration tasks such as
creating routing roles, configuration archiving and managing policies are still necessary. Chief Information
Officers (CIO) who want to generate more business value from IT by necessity have to be in the front line of
cloud skills education—both for themselves and to build training capacity for their IT staff. One way IT
professionals become more essential in the cloud era has to do with their ability to implement public cloud

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services , moving existing customer applications or building new applications in the public cloud. While
managing and configuring these various services remains in the IT professional’s hands, the majority of the
infrastructure tasks are eliminated.
Tasks that remain include monitoring, configuration, and integration with existing on-premise services such
as Active Directory, while activities such as purchasing hardware, installing operating systems and
managing patches are no longer needed since they are handled by the cloud provider. Once IT professionals
learn more about the cloud and they see there’s a big change that will help them in the future, it will become
clear to them that they will have a job that is more challenging than just being an administrator.
Considerations for Developers
Developers will have to focus on innovation, integration, and rapid delivery on business requirements. They
also will find more design opportunities beyond what they currently manage. Developers will need to work
effectively with a much broader group of IT professionals for solutions they are developing. IT will also
need to work more closely with business units to find out what they can do to help improve the productivity
in departments such as marketing, human resources, and finance. Since enterprises can adopt more varied
solutions in the cloud, it becomes vital to ensure that the selected solutions address any required service
agreements between the business and IT.
Security Implications
Cloud solutions have new security implications for consideration. Organizations in different industries have
divergent requirements regarding privacy and data retention. This means that the solution selected by an
organization or an enterprise must be carefully evaluated to ensure that the selected services allow the
organization to remain in compliance. International companies may need to comply with regulations that
vary by country or economic region. These must also be taken into consideration by the IT professional
when selecting a cloud-based service. Managing security and compliance involves translating enterprise
compliance requirements into a technology implementation. This requires practical skills and an
understanding of implementing compliance within the deployed solutions. IT professionals will benefit from
sharpening their security skills, including knowledge around data protection, privacy standards, and secure
message integrity. Secure messaging may include topics such as encryption, digital signing, and malware
protection. Additional skill sets of value include identity management, authentication methods, and auditing.
The next few years will see a mix of private and public cloud solutions. That makes the challenge even

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better because they have to deal with connecting the two. Identity management will be the key in the next
few years.
Critical Skills by IT Job Role
The following are job roles and skills the IT professional can invest in:
 Business liaison: Move skills up the stack in the decision process. Hone expertise to the business from
within IT. Move into design and architecture roles. Determine whether to focus in-house or off-premise,
define options whether the organization decides to stay on-premise or moves to the cloud.
 Data centre manager: Reposition data centre skills toward the hosted data centre. Enhance automation
skills. Work in standardized environments and with standardized applications as an option. Become
good at management applications, scripting, and performance optimization. Acquire best practices skills,
such as information services technology management.
 Security specialist: Help businesses move core business processes and data securely to private, public,
or hybrid cloud solutions. Security specialists need to stay abreast of new security models and
technologies, such as data protection skills, privacy standards, securing message integrity (encryption,
digital signing and malware protection), federated identity management, authentication methods, and
auditing.
 Software architect: Serve as a link between the organization’s technical and business staff. Architects
are asked to design and build complex distributed systems that exist both outside and inside an enterprise
and the cloud. They need to acquire the new skills required to build infrastructure, platform, and
software clouds. They need to understand how to design and construct multi-tenant and virtualized
systems that can manage thousands of simultaneous users and isolate higher levels of the stack from
physical component failures.
Another consideration would be “change management.” IT professionals need skills to manage the common
practices. Organizations need to have security- and compliance-certified employees.
Software as a Service (SaaS): Productivity Skills Needed for Productivity Solutions
SaaS is “software deployed as a hosted service and accessed over the Internet.” It will play a major role in
the coming years. IT professionals need to define the best solution for creating a single identity for users, an
identity to share across all cloud solutions. “The next few years will see a mix of private and public cloud

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solutions,” Sellen rode said. “That makes the challenge even better because they have to deal with
connecting the two. Identity management will be the key in the next few years.” What IT professionals need
to know about is Internet connectivity, including the Domain Name System (DNS) registration and
everything that comes with it
The specific areas where training is given in IT/Software Development sector are:
Computer Manufacturing, EDP/ E- Commerce, Designing, Maintenance Service Operating jobs, Computer
operators, Data Entry, System Developing /Programming /Software Engineering, Networking

Application Programming
 Research and Development in Peripheral Integration
 Product Quality Control and Reliability Testing
 Enterprise Resource Planning (ERP)
 Database Warehousing and Management
Conclusion
The major factor that is responsible for growth in IT sector is the e-governance initiatives introduced by
central government and various other state governments.
Now there is a notable shift from long-term course to short-term training certifications. Due to this, the
focus is now on hiring professionals with expertise in particular domains. The demand has largely for JAVA
and .NET professionals. And on the networking end, network storage and Linux demand is taking a toll

References
1. Mainardi Cesare, 2012. The Global Information Technology Report 2012. Living in a Hyper Connected
World.
2. Huang, Gug, Xie, Wu, 2012. The Convergence of Information and Communication Technologies Gains
Momentum. World Economic Forum. The Global Information Technology Report 2012. Living in a
Hyper Connected World.
3. Yafang Sun, 2012. The Global Information Technology Report 2012. Living in a Hyper Connected
World.

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4. Dutta Bilbao-Osorio, 2012. The Network Readiness Index 2012: Benchmarking ICT Progress and
Impacts for the next decade. The Global Information Technology Report 2012. Living in a Hyper
Connected World.
5. Biggs, Johnson, Lozanova Sundberg, 2012. Emerging Issues for hyper connected world.The Global
Information Technology Report 2012. Living in a Hyper Connected World.
6. Hagstorm, Gill, 2012.The wisdom of the Cloud: Hyper Connectivity, Big Data and Real Time
Analytics.The Global Information Technology Report 2012. Living in a Hyper Connected World.
7. http://traininganddevelopment.naukrihub.com/training-scenario/it/emerging-scenario.html
8. http://www.microsoft.com/learning/en/us/certification/cert-cloud.aspx.Cloud computing what IT
professionals need to know.
9. "Vision and Mission". NASSCOM. Retrieved 2012-01-13.
10. http://www.zdnet.com/blog/hinchcliffe/eight-ways-that-cloud-computing-will-change-business/488
11. http://en.wikipedia.org/wiki/Information_technology_in_India#cite_note-nasscom-0,Indian IT-BPO
Industry
12. http://www.gartner.com/it/page.jsp?id=2007116

IT-153
Ms Gurjot Kaur
Assistant Professor
Akal Group of Technical and Management Institutions
Mastuana Sahib
Phone no: 9878453985
Email id: [email protected]

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IT in Management Decision Making – A theoretical Approach

Keywords:information systems, decision making, management functions, managerial roles.

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1. Introduction

Moving from industrial society to information and knowledge society has its impact on social, economic
and cultural aspect of life. There are only few aspects of life nowadays which are unaffected by information
technology . In recent years, information systems technology have become crucial and is playing a critical
role in contemporary society and dramatically is changing economy and business. Business is conducted in a
global environment and simply could not serve without computer based Information Management systems.
Furthermore, we are entering the information age because of information technology and information
systems usage. The use of information systems especially is often understood to be changing the way
business and organisations work as well as help managers reduce uncertainty in decision making. It is
interesting to note that most authors (Lucey, 2005; Hicks, 1997; Gordon and Olson, 1985; Ward and
Peppard, 2002) would agree that information systems are playing an increasingly important role in
organisationsof all types, regardless of their size. It is often stated that information systems is a tool to help
improve management by using available information for decision making . Several studies have found and
reported diverse findings regarding information systems usage in decision making (Davis and Olson, 1985;
Hicks, 1997; Kumar and Mittal, Jawadekar etc.). We should emphasize that although decision making it is
one of the areas that information systems have sought most of all to affect, there have been only a few
existing studies that have dealt and examine the role of information systems in management decision
making. To place this study in context, we turn to the papers by Lucey et al. (2005) and Haag and
Cummings (2006). They noted that information systems support decison making in organisations and vary
among managerial levells . Information systems usage to support managers in decision making falls into one
of two general categories of systems that help users to analyze a situation and leave the decision up to him/

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her and systems that actually make some sort of recommendation concerning what action to take (Lucey,
2005; Haag and Cummings, 2006).
In this paper the focus is to give an understanding of the role that information systems have in
managers decision making and
to discuss the possibilities how managers of organisations can make best use of information systems. This
study provide researchers
with a framework of information systems usage in decison making and offers the ways how information
systems can help managers
reduce uncertainty in decision making.Furthermore, we consider that our study is important since it helps
not only to understand the role that information systems have in decision making, but also help to
understand how this technology support major components of management and decision making functions.
Information systems is especially important to managers at the lower or operational level since it appears
that they receive the most aid, since computers and information systems are best able to deal with well-
structured problems for which these managers are responsible( Hanic 1998;Davis and Olson, 1985).

The paper also intends to provide a better understanding of management functions and roles and offers an
alternative approach to investigate the role that information systems have in management decision making in
organisations. The rest of article is organized as follows. In the following section we provide the functions
of management and managerial roles and we than describe information systems and three levels of decision
making. Lastly, we conclude our study with a suggestions that althought information systems intend to
support management decision making and have made great contributions to organisations , until recently
these contributions
of information systems have been confined to narrow, transaction processing area. Much work needs to be
done in broadening the impact of information systems on profetional and managerial life and further
research are needed.

2. Functions of Management and their Managerial Roles

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Information systems claim to support managers, but they cannot be built in business and organisations
unless we understand what managers are, what thay do and how they do it. An individual who gets the
things done is a manager . It is necessary to distinguish between this tasks of managers and the functions of
management. While managing, a manager may perform the activities such as accounting, selling,
manufacturing, purchasing etc. These activities are called as tasks and not as functions. The activities that
are
performed through the managerial function are presented with the classical model of what managers do,
espoused by writers in the 1920’s such as Henry Fayol who identifies the following functions as the
parameters of what managers do: planning, organising, directing (motivating) and controlling (Fig.1).

Fig 1. Functions Of Management

Planning Organizing Directing Controlling

The management process has four functions and is executed through a variety of decisions taken at
each function of management (Jawadekar, 13-14). According to Kumar and Mittal planing function of
management it is the formulation of what is to
be done. Organising function is a means by which human resources, physical assets, money and time are co-
ordinated into efficient production of goods and services. The most vital function of management is
directing or motivating function, which calls for the practice of high degree of skills based on sufficient
knowledge. While, controlling function as the last stage in management tends to complete the full cycle of
the process of management through which managers accomplish results (Kumar and Mittal, 20-22).

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Fig. 2 - Functions and tasks of management

Planning Organizing
Establish goals and Assign responsibilities
develop strategies and to individuals and
tactics groups.

Controlling Directing

Evaluate and adjust Lead by motivating

organizational and communicating
As shown in Figure 2, which summarises functions and tasks of management in his planning function
performance
management establish goals and develope strategies and tactics. Individuals and groups differ in their
approaches to thinking and decision making. Knowing these differencies in their organizing function
managers assign respossibility to individuals and groups. Lead by motivating and communicating in the
function of directing (motivating) they evaluate and adjust organisational performance (directing and
controlling functions). Information systems as a tool for information processing can support these functions.
The activities of managers is characterized by decision making, which is a critical managerial function
(Shajahan and Priyadharshini, 34). Managers need information to take decisions, but also in order to act in a
variety of management functions. Therefore, it is usually that information systems are required when
organisations grows and management function is performed by people who are specialized and may be
removed from day-to-day activities. The attention of managers increase rapidly from one issue to another,
with very litlle pattern. When problem accures all other matters must be dropped until it is solved.

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Therefore, usually there is simply not enough time for managers to get deeply involved in a wide range of
issues. Research suggests that a manager’s day is characterised by a large number of tasks with only small
period of time devoted to each individual task. Furthermore, Crawford (1997), observed that given the
nature of the work, managers tend to rely upon information that is timely and verbal even if this is likely to
be less accurate then more formal and complex information systems.
According to Henry Mitzberg cited by Hicks (1997) managers play at least three separate managerial roles:
interpersonal, informationaland decisional. Information systems can support these roles in varying
degrees.Managers need information from different sources in order to facilitate their ability to act in a
variety of roles. A manager’s interpersonal role flow directly from his authority and status and involves
directing and coordinating the tasks to subordinates. Manager should be the best informed individual in the
organisation. In informational roles manager gather and process large amounts of information as well as
distributes information to others in the organisation. Decisional role include the enterpreneur role, in which
manager initiates new projects and makes changes (Hicks, 1997). Information systems has less to
countribute in the case of a managers’s informational role than for the other two.

3. Information systems and levels of management decision making

The development of information systems technologies has accelerated changes to economy, organisations
and in all areas of businesses. Traditionally, information systems were used to support operational functions,
whith the emphasis on achieving information systems efficiency and effectiveness. Furthermore, the
emergence of information systems goes back to the 1950’s and 1970’s when information systems were
mainly transaction applications, named simpl because they invovled processing accounting
transactions. Advances in technology made it possible to access data more quikly and new programming
systems helped to develop and refine operating systems, which provided the organisational data necessary to
run an organisation more efficiently on a day-to-day basis. Information systems started to provide reports
and information that enabled managers to make more effective decisions and have become tools to support
management. Today, information systems is more complex than in 1970’s or even in 1980’s, when the
emphasis was on operational needs. One reason for this is the recognation that information systems plays

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different roles in organisations and businesses and help managers reduce uncertainty in decision making
(Thompson and Beer, 2000). With the rapid
development of information systems technology prior to the 1980’s, the role of information systems in
businesses and organisations has changed, went out of style and was repliced with the term management
information systems which was used to refer to the complete computer based information systems of a
organisation (Hicks, 1997). Thus, in the past two decades from it’s conventional function of supporting
business operations, information systems role emerged as a strategic tool for decision making. This new role
is highlighted in several studies (Davenport and Short, 2004; Porter and Millar,1985). Lucey (2005)
emphasises the decision focus of his definiton of information systems. He observed that “information
systems is a system to convert data from internal and external sources into information and to communicate
that information in an appropriate form to managers at all levels in all functions to enable them to make
timely and effective decisions for planning and controlling the activities for which they are responsible.”
(Lucey, 2005). Wconsider that his definition express the essence of information systems usage to assist
managers in decision making in three levels of management. Hicks (1997) observed that today, in many
businesses the information systems have become a crucial asset and information systems are used
extensively not only to support management in decision making, but it may also be designed to provide
decisions for repetitive classes of problems (Hicks, 1997).
Nowdays, information systems are the means by which organisations and people, using
information technologies, gather, process, store, use and disseminate information (Bocij, Chaffey, Greasley
& Hickie, 2003). Whereas, firms are using information systems as a strategic weapon to gain competitive
advantages and many business processes are redesigned to take advantages through the use of information
tachnology and information systems (Hicks, 1997). As noted earlier, decision making is often seen as the
centre of what managers do, something that engages most of managers time. In order to take decisions,
managers need the right information to serve a wider range of needs. In fact, information has long regarded
as a very important aspect of decision making in the business environment because information gives power
to decision makers. Combs (1995) poitned out that accurate, rapid and relevant information are considered
to be vital to improving performance and competitive advantages of business and organisations (Combs,
1995). On the other hand Lucey (2005) suggests that relevant information is essential to any business

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decision (Lucey, 2005), and information systems have become an important factor in decision making. A
systems approach to managing this demand can be met through information systems.
In fact, it is often stated that an information systems is a tool to help improve management by
using available information for decision making. Underlying this is a number of assumption. Firstly, the aim
of an information systems is to produce information for action and secondly that if available, it will be used
to facilitate decision making. This implies a relationship between information systems usage and
management and decision making. The main job of managers is to makedecisons and information produced
by information systems is linked to decision making. Furthermore, information systems are designed to
support management activities,
in particular better decision making. To understand the relationship betweeen information systems and
management decision making, we must look at several studies of well known and leading authors on
information systems, such as Lucey (2005),Hicks (1997), Davis and Olson (1985) etc. who found that
decision making is a complex proces and managers are involved in a complex and diverse contacts with
customers, competitors, colleagues, government officials, and so forth. They should be able to define the
type
of information they need and require in each level of decision making. Managers should understand too
what information systems is,
what information systems can and cannot do in order to help their organisation succedd (Haag, Baltzan and
Philips, 2006).

Decision making is a complex process involving many variables that we do not yet fully understand.
However, many aspects of business decision making are clear and business decisions take place at each
level of management in an organization although there are different characteristics at each level within
organization. Gory and Morton (1989) provide a useful framework for exploring the nature of managerial
work that includes an understanding of both the purpose of management activity (involving planning and
control at strategic, tactical and operational levels) and the way in which managers solve problems and make
decisions (Gory and Morton, 1989). Decision making can be divided or distinguished from one another
three types: strategic, tactical (or control) and operational. Information are required at three different levels
of management decision making and information systems has to support each level of decision making.

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Decision making is an integral part of management and occurs in every function and at all levels of decision
making. Decision making is based in information. Information is needed to define and structure the problem,
to explore and choose between the alternative solutions and to review the effects of the implemented choice.
Figure 3, summarises the main characteristics and information requirements of the three levels of
management decision making .
The strategic level of management decision making occupies long term horizons of decisions. Strategic
management (executives and directors) is responsible to develop organizational goals, strategies, and
policies as part of a strategic planning process. Decision making is much more dependent on human factors
and judgment. At the tactical level of management decision making managers and business professionals in
self-directed teams develop short and medium range plans, schedules and budgets and specify the policies,
procedures and business objectives for their subunits. At the operational level of management decision
making decisions are
short term and managers or members of self directed teams have clear objectives and decision rules and
develop short-range plans such as weekly production schedules.
Individuals make two general types of decisions: structured or programmed decisions and unstructured or
nonprogrammer decisions . According to Lucey, (2005), Hicks (1997) and Davis and Olson (1985), in a
programmed decisions the rules for making the decisions are explicit and decision can be specified in
advance. The term does not necessarily mean that the decision is automated, althought many programmed
decisions are automated. Nonprogrammer decisions deal with no repetitive and no defined problems, and
require human decision making. Nonprogrammer decision has no decision procedure, either because the
decision is too infrequent to justify the organizational cost of preparing a decision procedure or because the
decision procedure is not understood well enough (Lucey, 2005; Hicks, 1997; Davis and Olson, 1985).

Fig:- Levels Of Management Decision Making

Information
Characteristics

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Decision Structure

Structured

Semi-Structured

Unstructured

4. Conclusions

Information systems form an integral part of modern organisations and businesses and are designed to
support management activities, in particular, better decision making. Management has four distinct
functions and each requires support from an information systems, as well as information are required at
three different levels of decision making and information systems has to support each level. Although,
effective use of information systems in management decision making gives power to managers and help
organisation succeed, it is necessary to claim that there is not enough empirical studies and results that
examine the role of information systems technology in decision making and much work needs to be done in
broadening the role of information systems on profetional and managerial life.
Finally, it is possible to state while information systems have made great contributions to organisations,
managers should rise their understanding what information systems is, and what information systems can
and cannot do. Today, understanding the role of information systems as information processor has on an

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organisation, is crucial to running a successful business. In the future information systems can be absolutely
crucial to business survival.
5.References

1.Crawford ,I.M.(1997): Marketing Research And Information Systems(Marketing and

AgriBusiness,Text-4) Available at URL :[http://www.fao.org/docrep/W3241E/w3241e0a.htm].
2Combs,R.M.(1995):Information Systems for Business Management ,Pitman Publishing, Great Britain.
3. Goring. & Scott Matron.(1998): AFramework for Management Information Systems,Management
Review, Vol. 49.
4. Hicks, O. J. (1997):Management Information Systems,3rd Edition, USA.
5. Gordon,B.D. & Olson,M.H: (1985):Mangement Information Systems,Conceptual Foundations,Structure
and Development, 2nd Edition, McGraw Hill Book Co, USA.
6. Lucey,T:(2005):Management Information Systems, 9th Edition, Thomson Learning, London.
7. Ward,J.and Peppard(2002)-Strategic Planning for Information Systems, Wiley Series in Information
Systems, 3rdEdition, UK.
8. Porter, M.E., and Millar, V.E. (1985):How Informatiion gives You Competitive Advantage,,Harvard
Business Review, 63, 4, pp.149-161.
9. O’Brien, J. and Marakas, G. (2007):Management Information Systems with MISource, 8th Edition,
Boston.
10. Shahjahan,S. & Priyadharshini,R.-Management Information Systems,New Age International
PublishersNew Delhi, ISBN-81-224-1549-0. Available at URL: [http://www.booksgoogle.com].
Accessed: 12.06.2008.
11. Kumar,N.,Mittal,R.-Management Information Systems,New Delhi, ISBN-81-261-1675-7. Available at
URL: [http://www.booksgoogle.com/books/]. Accessed: 25.10.2006.
12. Haag,S,Baltzan,P.and Philips,A.(2006):-Business Driven Technology, McGraw-Hill, New York.
13.Davenport,T.H,Short and ,J.E(2004):The New Industrial Engineering,Information Technology and
Business ProcessDesign,Management Review, 31, 4, pp.11-27.
14. Haag,S& Cummings,M.: (2006):Essentials of Information Systems, McGraw-Hill, New York.
15.Bocij,P.,Chaffey,D.,Greasley,A. and Hickie,S.(2003):Business Information
Systems,Technology,Development andManagement for the E-Business, 2nd Edition, England.

IT-154

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A Survey of Energy Optimization Techniques in Wireless Sensor Networ

*Meenu Chawla

*Assistant Professor, CSE Deptt GZSCCET, BTI

*[email protected]

Abstract
Wireless Sensor Network (WSNs) have become predominant in both industrial applications as well as
personal use. With the advent of Internet of Things (IoT) there has been a re-emphasis on research,
development and application of WSNs. WSN nodes are characterized by low processing power, limited
lifetime, and lack of mobility. So the major challenge is to design a high quality WSN irrespective of these
constraints. In this paper we have presented an in depth analysis of one of these constraints i.e., limited
power availability in WSNs. We have presented a review of major techniques to conserve power in WSNs.
Especial focus is given on AI based power optimization techniques including clustering, fuzzy logic, nueral
network based techniques etc.

Keywords—WSN, sensors, wireless sensor networks, energy efficiency, power optimization

Introduction
A WSN is a network consisting of sensor nodes that communicate wirelessly and are deployed over a large
geographical area. Each node in WSN consists of atleast 3 subcomponents- a sensor to sense the
environment in which it is deployed, a processor for processing and/or analysing sensed data, storage- for
storing data temporarily untill it is sent to a base station and a wireless transiever for transmitting and
recieving data from peer nodes or from base station. In order to power the above mentioned components
WSN nodes usually also have an embedded battery inside them. The capacity of this battery is very limited
and it is also very incovinient or sometimes even impossible to frequently replace the battery because of the
harsh environment in which the WSNs are usually deployed. So it is of paramount importance to conserve
as much energy as possible.
The general architecture of WSN is shown in figure 1. The WSN consists of a sink node which is sometimes
also referred to as base station. WSNs also consists of a large number of sensors that are distributed above a
large geographical area. The are over which the sensor nodes are spread is also called sensor field. The
sensors as well as the sink can be stationary or moving. The sink is usually also connected with internet or
some other form of WAN. Users operate and monitor the entire WSN remotely using the sink node.
All the operations of WSN consume energy. However the highest percentage of energy is consumed in
transmitting messages from sensor node to sink node (long distance communication). Other operations like
sensing of environment or processing of data etc. normally consumes way too less energy than transmitting
of data. Energy conservation techniques in WSNs usually follow two techniques- either reduce the

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frequency of data communication from sensor nodes to sink nodes or reduce the frequency or amount of
data sensed by sensor nodes.
This paper performs a survey or more appropriately a comparative study of various WSN power
optimization techniques. Major emphasis is to reduce energy consumed during communication in WSN.
Most of the modern research apply artificial intelligence techniques like clustering, neural networks, fuzzy
logic, extreme learning machines to achieve this goal. Thus these technique takes a centerstage in our study
as well. We will be exploring the major design principles, features and working of the current state of the art
as well as under research energy conservation techniques of WSNs.
Fig. 1. Architecture of Wireless Sensor Network

The rest of the paper is organized as follows- section two provides an overview of some related work done
in this field, section three discusses taxanomy of power optimization techniques in WSNs. Section four
compares these techniques based on various parameters along with their applicability as well as
shortcomings. Section five concludes the paper and give future direction to our work.

Related work
In [1], researches have provided us with a broad survey of various energy conservation techniques present
in WSNs. They have given taxonomy of traditional energy efficiency techniques as well as the under-
development energy efficiency techniques of WSNs. At the most fundamental level, there are three energy
conservation techniques- duty cycling, data driven approaches and mobility based approaches. In duty
cycling technique, a node goes into off-state or sleep state whenever a communication is not required. Since
communication is required very rarely so putting a node in sleep state saves lots of energy. In data driven
approaches, the major focus is how the data is sensed which also considerably impacts the energy
consumption of WSN. There are lots of samples sensed which are not at all required. Also unnecessary
computation in the power constrained WSN node also impacts its battery life. Mobility based approaches

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focus on the mobility of WSN nodes. If a sensor node is mobile then it focus on how to collect its data, how
it will relay the message, how it will impact the overall network etc.
I.F. Akyildiz et al. in [2] provides a study on modern day WSNs.They first discuss some basic terminologies
used in WSNs and then explore various sensing tasks. Next they discuss various applications of WSNs.
They also enumerate various factors that impact the overall design of a sensor node. They also discuss the
communication architecture of WSNs along with various alogorithms and protocols that facilitate te
working of WSNs. Finally they discuss come research challenges in realization of WSNs.
In [3] Ameer Ahmed Abbasi et al. gave a survey of various clustering algorithms that are specifically
designed for WSNs. They discussed about various convergence time algorithms where convergence time is
the time required before all the routers/cluster heads reach an agreement about the topology of the WSN.
They classified clustering algorithms in two categories- variable convergence time algorithms, constant
convergence time algorithms. Variable convergence time algorithms are useful when number of nodes in
WSN is low while constant convergence time algorithms are useful when number of nodes in WSNs is high.
A detailed performance evaluation of data aggregation in clustering based WSNs is provided by Adwitiya
Sinha et al. in [4]. They have clustered sensor nodes based on their entropy. Firstly, nodes sensing similar
kind of data are placed in distinct clusters. In the worst case if no more cluster can be formed, then
divergence of a node is calculated with respect to each cluster then nodes are placed in least divergent
clusters. Lastly they evaluated performance of their scheme based on various parameters like convergence
rates, average packet drop, transmission cost etc. using NS2 simulator. Their result demonstrate that their
proposed scheme outperform various current energy conservation schemes of WSNs.
Dervis Karaboga et al. [5], proposed one more scheme for clustering in WSNs using bee colony algorithm.
In bee colony algorithm, we try to simulate the behaviour of honey bee swarms. The researchers have
proposed new algorithms called ICWAQ to create cluster and select cluster heads. Their proposed ICWAQ
algorithm not only prolongs WSN lifetime but also improves QoS of the WSN. Their experimental results
show that ICWAQ works respectably with respect to other algorithms.
A fuuzy logic based clustering technique is proposed by Jin-Shyan Lee et al. in [6]. They have augmented
fuzzy logic in LEACH algorithm for WSNs. In their technique called LEACH-ERE, the cluster head is
selected using a fuzzy approach which focuses on expected residual energy which is the residual energy left
in a sensor node if it will be selected as cluster head and complete its round. Thus the overhead of becoming
the cluster head is more appropriately distributed among the various nodes in a cluster. Their simulation
results show that the proposed scheme is more efficient than most of other distributed algorithms for WSNs
including LEACH and CHEF.
In [7], the researchers have proposed yet another fuzzy based scheme for cluster head selection. However,
unlike other schemes, the selection of cluster heads will be carried out in the base station. The fuzzy inputs
chosen by them are energy level of sensor nodes and physical distance to base station. Their experimental

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result prove that their proposed scheme is able to reduce energy consumption in First Node Dies (FND)
round as well as it has also increased the throughput of the base station before FND.

Taxonomy of Power Optimization Techniques in WSNs

Power optimization techniques can be broadly classified into five distinct categories as shown in figure 2-
radio transmission optimization, reducing data inside WSN, power optimized routing techniques, sensor
nodes sleep/wake mechanisms and energy repletion techniques etc.

Fig. 2. Architecture of Wireless Sensor Network

Radio Transmission Optimization:

This is the first category of power optimization technique which involves reducing the power consumed by
radio component of a WSN. The radio sub component is responsible for transcieving (transmitting as well
as recieving) the data to and from sink node. Radio optimzation can be further sub categorized as :
improving modulation, collaborative communication, optimizing transmission power, designing intelligent
radios that can select the most appropriate radio channel etc.
Power Optimized Routing Technique
Routing in WSN is required in multihop WSN when the distance between sensor node and sink is so large
that data can not be transmitted directly between them. Routing also consumes a considerable amount of a
resources of a resource constrained sensor node. The nodes closer to sink are often burdened with additional
task of routing data on behalf of the whole WSN to sink. This results in fast depletion of battery of nodes
closer to sink. Power optmized routing can be achieved through clustering, multipath routing, routing using
relay nodes or repeaters etc. In cluster based routing the WSN is divided into clusters or groups and each
cluster is managed by a cluster head which is selected from one of the nodes inside the cluster. All the nodes
belonging to a cluster first transmit their cluster head which in turn transmit it to sink node. Thus energy is
conserved since majority of nodes only have to transmit data over a very short range. In multipath routing

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techniques, there is more than one path from sensor nodes to sink node on which data is transmitted. This
not only reduces network congestion but also distributes workload of routing. The drainage of battery on
the paths from sensor node to sink is also reduced as compared to single path routing. In relay based
routing, enhanced capability nodes can be placed in crucial positions of WSN. They can help in data
transimission, analyis and interpretation. Also the sink node can also be made mobile so that keeps on
moving within the WSN and collects data from various parts. Thus no partiular set of nodes will be
overloaded with additional data transmission tasks and will result in longetivity of the WSN.
Reducing data inside WSN
Another popular technique of power optimization is reducing the amount of data generated, processed or
transmitted in WSN. Data reduction inside WSN can be primarily achieved by two techniques- reducing the
frequency of sample collection and limiting unncessary sample collection. Apart from this, other computer
techniques such as data compression and network coding can also be utilized to diminish the sensed data.
Also there certain parameters that are highly coorelated and one can be implied from the other. Thus, this
coorelation can also be exploited to lessen the quantity of data.
Sensor nodes sleep wake mechanisms
A sensor node always consume energy whether it is working or it is idle. A node in idle state will not do
anything yet consume the similar amount of energy as a working node. Thus the best solution to put the
idle nodes in sleep mode and wake them up when there is a task for them. The sleep wake mechanisms
utilize an important technique known as duty cycling. Various nodes in a WSN are not kept awake all the
time. Rather they are alternarively put to sleep wake mode based on some predecided criteria. The nodes
might be sleeping and can be awaken if the need arises or they can set their schedule suchthat they sleep for
some time and then stay awake for sometime or a they can sleep for random duration of time before waking
up.

Comparison of some existing power optimization techniques in wsn

Now we provide a comparative study of some of the popular technquies and researches in WSNs.
The comparison is done based on the following criteria- broad area, underlying concepts and merits. The
first criteria i.e., broad area defines in which area a particular technique belongs based on the
aforementioned taxonomy (radio transmission optimizatiom, power optimized routing, reducing data inside
WSN, sensor node sleep wake mechanisms, or other methods). The second criteria provides the underlying
or main concept which acts as a cornerstone of a given technique. The last criteria is merit that given
technique provides over others. There numerous power optimzation techniques that are either in use or
under development. We have shortlisted those techniques which we think are of significant importance.

TABLE I. COMPARISON OF POWER OPTIMIZATION TECHNIQUES IN WSN

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Techn Broad Underlying Merits

ique Area Concept
[8] Routing Clustering, Specially
Reactive suited for time
Networks critical
applications
[9] Routing Clustering- Achieves
randomized energy
rotation of conservation
cluster heads of 8x than
direct
transmission
[10] Reducing Context aware, More energy
data rule based reduction
framework based on the
context of
sensor data
[11] Others Energy Sensor battery
harvesting can be repleted
schemes in the field
[12] Routing Clustering, Useful when
reducing size of cluster
energy can not be
consumption at determined in
hotspots advance
[13] Sleep/Wa Coverage- The entire
ke guarantee, network is
clustering guaranteed to
be covered,
energy balance

Conclusion
This paper gives an overview of the various power conservation schemes in WSNs. We first discussed the
taxonomy of power conservation schemes and then discussed, analysed and compared few important ones
in detail. One conclusion that we can draw from this study is that most of the modern day researches focus
on only one specific technique rather than focusing on a a combination of two or more techniques to
conserve power. Also with the advent of ubiquitous computing and Internet of Things(IoT), we also have to
consider the fact that soon there won't be simple standalone WSNs rather there will be large convoluted

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heterogeneous sensor networks so we will have to re-analyse how they will impact the current power
conservation schemes for WSNs which is left as a future work to our current study.

References

[1] Anastasi, G., Conti, M., Di Francesco, M., & Passarella, A. (2009). Energy conservation in wireless
sensor networks: A survey. Ad hoc networks, 7(3), 537-568. Akyildiz, Ian F., et al. "Wireless sensor
networks: a survey." Computer networks 38.4 (2002): 393-422.
[2] Abbasi, Ameer Ahmed, and Mohamed Younis. "A survey on clustering algorithms for wireless sensor
networks." Computer communications 30.14 (2007): 2826-2841.
[3] Sinha, Adwitiya, and Daya Krishan Lobiyal. "Performance evaluation of data aggregation for cluster-
based wireless sensor network." Human-Centric Computing and Information Sciences 3.1 (2013): 1-17.
[4] Karaboga, Dervis, Selcuk Okdem, and Celal Ozturk. "Cluster based wireless sensor network routing
using artificial bee colony algorithm." Wireless Networks 18.7 (2012): 847-860.
[5] Lee, Jin-Shyan, and Wei-Liang Cheng. "Fuzzy-logic-based clustering approach for wireless sensor
networks using energy predication." Sensors Journal, IEEE 12.9 (2012): 2891-2897.
[6] Siew, Zhan Wei, et al. "Fuzzy logic based energy efficient protocol in wireless sensor networks."
ICTACT J. Commun. Technol.(IJCT) 3.4 (2012): 639-645.
[7] Younis, Ossama, Marwan Krunz, and Srinivasan Ramasubramanian. "Node clustering in wireless sensor
networks: recent developments and deployment challenges." Network, IEEE 20.3 (2006): 20-25.
[8] Manjeshwar, Arati, and Dharma P. Agrawal. "TEEN: a routing protocol for enhanced efficiency in
wireless sensor networks." Parallel and Distributed Processing Symposium, International. Vol. 3. IEEE
Computer Society, 2001.
[9] Heinzelman, Wendi Rabiner, Anantha Chandrakasan, and Hari Balakrishnan. "Energy-efficient
communication protocol for wireless microsensor networks." System sciences, 2000. Proceedings of the
33rd annual Hawaii international conference on. IEEE, 2000.
[10] Chong, Suan Khai, et al. "Energy conservation in wireless sensor networks: a rule-based approach."
Knowledge and information systems 28.3 (2011): 579-614.
[11] Tuna, Gurkan, Vehbi Cagri Gungor, and Kayhan Gulez. "Energy harvesting techniques for industrial
wireless sensor networks." inIndustrial Wireless Sensor Networks: Applications, Protocols, Standards,
and Products, GP Hancke and VC Gungor, Eds (2013): 119-136.
[12] Wei, Dali, et al. "An energy-efficient clustering solution for wireless sensor networks." Wireless
Communications, IEEE Transactions on 10.11 (2011): 3973-3983.
[13] Nan, Guofang, et al. "CDSWS: coverage-guaranteed distributed sleep/wake scheduling for wireless
sensor networks." EURASIP Journal on Wireless Communications and Networking 2012.1 (2012): 1-
14.

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IT-156
Constructive aspects of Big Data in retail sector for financial growth
* Dr. Gagandeep Jagdev **Ramandeep Kaur
Dept. of Computer Science Research Scholar (Ph.D Comp. App.)
Punjabi University Guru Kashi CollegeDamdama Sahib (PB)[email protected]
[email protected]
Contact - 09501041900

Abstract
Big Data is no longer an unpopular word anymore. Any data which poses a challenge for currently existing
database technologies is termed as Big Data. Today only big giants in the different fields like retail, medical,
stock exchange etc. can think of handling it because of expensive and huge infrastructure involved in
handling it. This research paper is based on highlighting how retail and cellular industry makes its use in
targeting customers. In today’s busy life no one loves to receive unnecessary junk mails or messages. It is
because of this that companies want to be crystal clear about each of its customer interest and his or her
pattern of shopping and expenditure. To be precise in knowing the interest of customers, companies needs to
regularly mine the data related to each individual customer and gain insight of his or her shopping pattern
like which goods he or she buys, customers budget, customers likes and dislikes etc. For handling such a
huge database of millions of customers, companies make use of powerful framework like Apache Hadoop.
Apache Hadoop is one such framework which is capable of handling huge databases via its several
components. It makes use of Map Reduce technology. Map Reduce technology is the same technology
which is used by Facebook in handling its popular section “People you may know”. The central theme of
this research paper is elaborating the working of Map Reduce technology and Apache Hadoop framework in
handling the enormous databases involved in retail industry.
Keywords - Apache Hadoop, Big Data, retail
industry, Map Reduce.

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I. INTRODUCTION
“Big data”– which admittedly means many things to many people – is no longer confined to the realm of
technology. Some examples to guess how big this Big Data is are mentioned as under.
 Every 2 days we create as much information as we did from the beginning of time until 2003.

 Over 90% of all the data in the world was created in the past 2 years.

 It is expected that by 2020 the amount of digital information in existence will have grown from 3.2
zettabytes today to 40 zettabytes.

 The total amount of data being captured and stored by industry doubles every 1.2 years.

 Every minute we send 204 million emails, generate 1,8 million Facebook likes, send 278 thousand
Tweets, and up-load 200,000 photos to Facebook.

 Google alone processes on average over 40 thousand search queries per second, making it over 3.5
billion in a single day.

 Around 100 hours of video are uploaded to YouTube every minute and it would take you around 15
years to watch every video uploaded by users in one day.

 Around 100 hours of video are uploaded to YouTube every minute and it would take you around 15
years to watch every video uploaded by users in one day.

 If you burned all of the data created in just one day onto DVDs, you could stack them on top of each
other and reach the moon – twice.

 AT&T is thought to hold the world’s largest volume of data in one unique database – its phone
records database is 312 terabytes in size, and contains almost 2 trillion rows.

 570 new websites spring into existence every minute of every day.

While big data is the convergence of more data from more sources than we have ever seen, it also
represents a cultural shift in the way retailers connect with consumers in a meaningful way. This bottom-
line impact of big data is what makes it a business imperative and why retailers around the world are
leveraging it to transform their processes, their organizations and, soon, the entire industry. Much more data

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can be derived as businesses and consumers move into the realm of pervasive connectivity that defines the
Internet of Everything (IoE) world. IoE combines people, processes, data, and things to enable the transfer
of information and create new potential for business innovation. Sensors and devices offer up data from
previously unconnected processes and their components, expanding the role of data in decision making
across the entire retail enterprise.

Fig. 1 Image depicts enormous amount of data been generated

Analytics are driving the move from merchant-driven business models—where the product is the
differentiator—to digital models, where every decision is informed by data. Brand engagements are
becoming more closely aligned with individual shopper preferences, creating a brand relationship that is
shifting from a “nice to have,” time-sensitive offer-based relationship to a “must have” digital
companionship based on deep insights and understanding of the consumer. To achieve this critical
differentiation, retailers are depending less on increasingly shorter product cycles and more on the enduring
differentiators of relationship and customer experience created through strategic use of data and analytics.
Companies increasingly understand that their ability to compete is tied to their ability to create and harness
value from data, and are seeking new ways to look at big data and beyond.
I. COMPLEXITIES RELATED WITH BIG DATA

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Fig. 2. V’s of Big Data

Data Volume – With the increase in volume, the worth of different data records will decrease in proportion
to age, type, richness, and quantity among other factors. Each day terabytes of data is produced by different
social networking sites and it is a fact that our existing systems fails to handle such huge amount of data.

Data Velocity – Data is being generated at tremendous speed with each minute passing. The velocity at
which this data is being generated is beyond the handling power of traditional systems. By using traditional
systems, it is not possible to perform the analytics on the data which is constantly in motion. Social media,
E-Commerce has rapidly increased the speed and richness of data used for different business transactions.

Data Variety - All the data being generated is totally diverse consisting of raw, structured, semi structured
and even unstructured data which is difficult to be handled by the existing traditional analytic systems. From
an analytic perspective, it is probably the biggest obstacle to effectively using large volumes of data.
Mismatched data formats, non-aligned data structures, and inconsistent data semantics represents significant
challenges that can lead to analytic collapse.

Data Value – The data that is being generated in huge amount is analyzed and used by different
organizations for data analytics. Often it is witnessed that there is a huge gap in between the business leaders
and the IT professionals. The main concern of business leaders is to just add value to their business and to
maximize their profit. On the other hand, IT leaders deal with technicalities of the storage and processing.

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Data Complexity - One current difficulty of big data is working with it using relational databases requiring
massively parallel software running on tens, hundreds, or even thousands of servers. Data scientists have to
link, match, cleanse and transform data across systems coming from various sources. It is also necessary to
connect and correlate relationships, hierarchies and multiple data linkages or data can quickly spiral out of
control [1, 6].

I. BIG DATA REQUIRES STRONG ANALYTICS CAPABILITIES

Big data itself does not create value until it is put to use to solve important business challenges. This
requires access to more and different kinds of data, as well as strong analytics capabilities that include both
software tools and the requisite skills to use them. Examining those retailers engaged in big data activities
reveals that they start with a strong core of analytics capabilities designed to address structured data, such as
basic queries, data visualization, predictive modeling and data mining (Fig. 2). Retailers were on par with
other industries in their use of simulation, natural language text analytics, geospatial analytics, streaming
analytics, and video and voice analytics.

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Fig. 3 Figure showing strong analytics with retail companies

Today supermarket chain uses data analysis and optimization to gain deeper customer insights and
generate sales. With INR 1325.90 million in inventory and more than six terabytes of product and customer
data spread across multiple systems and databases, the companies were unable to easily assess operations at
individual stores using manual processes. They needed a comprehensive and timely view of operations that
would support and improve decisions about business operations. With a new solution, the company has seen
dramatic improvements across its operations. Managers now quickly review daily inventory levels, store
sales and cost of goods to see which products are selling and most profitable and which promotions are most
successful. The solution enables chain limit losses by scheduling price reductions to move perishable items
prior to spoilage, effectively lowering losses on perishable goods, which are approximately 35 percent of the
chain’s products. Stores can adjust quickly as the government’s price settings on staple foods fluctuate, and

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the company can compile sales tax data 98 percent faster than before. These improvements resulted in a 30
percent increase in revenue and a INR 464.06 million boost in profitability for the companies. In fact, the
newfound visibility into operations and consumer behavior provided the insight to choose optimal locations
for four new stores [8, 9].

II. NEED TO UNDERSTAND CONVERSION RATE

In specialty retail, it is generally accepted that conversion is the standard for comparative performance
measurement. Conversion is a foundational metric—the first of the predictive analytics building blocks and
a requirement for creating high-performance retailing in the IoE (Internet of Everything) era. It normalizes
sales performance against the variable opportunity associated with each store, aisle, and category. There are
different definitions of conversion, but the true basic calculation is quite simple: Conversion is the measure
of transactions generated by a population of shoppers (Fig. 3). For example, if 1,000 shoppers generate 800
transactions, the result is an 80% conversion rate.

Fig. 3 Formula for conversion rate

Some retailers, particularly in fast-moving consumer products segments, use the number of transactions
as a proxy for conversion, assuming that all shoppers generate at least one transaction. This is fundamentally
incorrect and can cause businesses to overlook key problem areas. Of course, in grocery and other areas
where conversion is usually very high, some of the most valuable conversion comparisons actually come
from aisle-, category- and display-level analysis.

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Let’s examine a typical store-to-store comparison using sales revenue and transaction count. If Store A
reports POS revenue of $10,000 and 60 transactions, and Store B reports $20,000 and 100 transactions, the
conclusion might be that Store B is the better performer. However, once shopper traffic is taken into
consideration, we may find that Store A had 100 shoppers that week and Store B had 200. We now must
consider the performance results in the context of one very important variable: opportunity. What
opportunity did each store have that week to generate sales? Let’s look at the population of shoppers. Using
this definition of the opportunity variable, we see that Store A actually converted 60% of its opportunity,
while Store B only converted 50%. The sales numbers and ATV are of course better in Store B, but over
time they can create a false sense that the business is healthy, when in fact more shoppers may be leaving
without purchasing. If Store B could actually convert at the rate of Store A (60%) and keep its average
transaction value ($200/transaction) the same, it would contribute $4,000 more each week, even without any
improvement in traffic. That would be an additional $208,000 per year from a single store! [8, 9].

III. PROMOTING BIG DATA ADOPTION

A. Commit initial efforts to customer-centric outcomes
It is imperative that organizations focus big data initiatives on areas that can provide the most value to
the business. For most retailers, this will mean beginning with customer analytics that enable them to offer
better, more finely tailored products based on a better understanding of customer needs and predicted
behavior patterns. Retail organizations can use customer insights to generate enhanced products, improve
brand performance, drive customer loyalty, adjust pricing and improve customer satisfaction.

To effectively cultivate meaningful relationships with their customers across all retail channels (e.g.,
store, online, e-mail, mobile, etc.), retailers must connect with them in ways their customers perceive as
valuable. The value may come through preferred features and pricing and more timely, informed or relevant
interactions; it may also come as organizations improve their underlying operations in ways that enhance the
overall consumer experience. Retailers should identify the processes that most directly affect customers,
pick one and start; even small improvements matter as they often provide the proof points that demonstrate
the value of big data and the incentive to do more. Analytics solutions fuel the insights from big data that
are becoming essential in creating the level of depth in relationships that customers expect [8, 9].

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B. Define big data strategy with a business-centric blueprint

A blueprint encompasses the vision, strategy and requirements for big data within an organization and is
critical to establishing alignment between the needs of business users and the implementation roadmap of
IT. A blueprint defines what organizations want to achieve with big data to ensure pragmatic acquisition and
use of resources. An effective blueprint defines the scope of big data within the organization by identifying
the key business challenges involved, the sequence in which those challenges will be addressed, and the
business process requirements that define how big data will be used. It serves as the basis for understanding
the needed data, tools and hardware, as well as relevant dependencies. The blueprint will guide the
organization to develop and implement its big data solutions in realistic ways that create sustainable
business value. For retailers, one key step in the development of the blueprint is to engage business
executives early in the process, ideally while the company is still in the Explore stage. For many retailers,
engagement by a single C-suite executive is sufficient. But a more diversified company may want to tap a
small group of executives to cross organizational silos to develop a blueprint that reflects a holistic view of
the company’s challenges and synergies.

C. Start with existing data to achieve near- term results

To achieve near-term results while building the momentum and expertise to sustain a big data program, it
is critical that retailers take a pragmatic approach. The most logical and cost-effective place to start looking
for new insights is within the organization’s existing data store, leveraging the skills and tools most often
already available. Looking internally first allows organizations to leverage their existing data, software and
skills and to deliver near-term business value. In addition, companies gain important experience as they then
consider extending existing capabilities to address more complex sources and types of data. While most
organizations will need to make investments that allow them to handle larger volumes of data or a greater
variety of sources, this approach can reduce investments and shorten the timeframes needed to extract the
value trapped inside the untapped sources. It can accelerate the speed to value and help organizations take
advantage of the information stored in existing repositories while infrastructure implementations are
underway. Then, as new technologies become available, big data initiatives can be expanded to include
greater volumes and variety of data [8].

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D. Build analytics capabilities based on business priorities

The unique priorities of each company should drive the organization’s development of big data
capabilities, especially given the margins and specific production and distribution challenges that most retail
firms face today. The upside is that many big data efforts can concurrently help reduce costs and increase
revenues, a duality that can bolster the business case and offset necessary investments. For example, many
retailers strive for improved Omni- or multi-channel models in which the customer experience leverages the
strengths of different channels and enables alternate options such as buy online and then pick at store, all
while promising and delivering the right inventory in the right place. From a planning perspective,
merchandisers and inventory planners must be able to project how the right assortments and inventories
must be planned and procured, often with months of lead time and a complex mix of vendors and suppliers.
In operations, master data management and inventory visibility become crucial, as retailers must optimize
inventory across stock. Retailers should focus on acquiring the specific skills needed within their
organization, especially those that will increase the organization’s ability to analyze unstructured data and
visualize its analysis to make it more consumable to business executives [8, 9].

E. Create an investment case based on measurable outcomes

Developing a comprehensive and viable big data strategy and roadmap requires a solid, quantifiable
business case. Therefore, it is important to have active involvement and sponsorship from one or more
business executives throughout this process. Equally important to achieving long-term success is strong,
ongoing business and IT collaboration.

F. Getting on track with the big data evolution

An important principle underlies each of these recommendations: business and IT professionals must
work together throughout the big data journey. The most effective big data solutions identify the business
requirements first, and then tailor the infrastructure, data sources, processes and skills to support that
business opportunity. To compete in a consumer-empowered economy, it is increasingly clear that retailers
must leverage their information assets to gain a comprehensive understanding of markets, customers,
products, distribution locations, competitors, employees and more. Retailers will realize value by effectively

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managing and analyzing the rapidly increasing volume, velocity and variety of new and existing data, and
putting the right skills and tools in place to better understand their operations, customers, channels and the
marketplace as a whole [9].

IV. POINTS TO BE CONSIDERED BY RETAILERS

The shopping trends have undergone a total change in the past few years as the control has now shifted in
the hands of consumers. Before buying any product consumer can compare the price of that particular
product at different on line shopping websites and choose for the economical one. Further consumers today
have a privilege to read and give their views related to the product and provider. It provides a lot of help to
the buyer to learn from the experiences and reviews of the people who have already tried that particular
product. It is now the time for retailers to think and employ new strategies to attract customers with
themselves because of hard competition prevailing in the retail market. For this retailers make use of Big
data and Hadoop for harnessing massive volumes of new data available [8, 9].

A. Providing up-sell and cross-sell recommendations

The most widely adopted use case in retail sector is up-sell and cross-sell recommendations. Retailers
can promote thir product based on what products have been bought by similar customers. Big Data provides
real-time capabilities that enable recommendations to be delivered at the right time and place to the right
device

B. Social Media Analysis

Today there is need for retailers to monitor online sentiment of customers and respond in real time via
offers or messages. This helps retailers to gain insights of customers purchasing behavior by analyzing their
prior transactions and social network activity.

C. Dynamic Pricing Across Multiple Channels

It is obvious that when customers can shop across multiple channels in real time, even minor difference
in price can make difference in their purchasing decision. Big data provides more refined set of indicators as

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compared to conventional influencers like time and availability. Some other pointers to consider are
weather, location, social media presence etc.

D. Fraud Detection
Retailers need to detect fraudulent activities in order to safe guard their margins and reputations. Big
Data can provide assistance to the retailers to recognize anomalies and patterns by continuously monitoring
the tactics and practices that looks unusual. This can help indicate incidents of fraud such as shrink and store
associate theft and look for exceptions.

V. CONCLUSION
In this paper, we have introduced a vision of analytics as a new guiding principle for operating in today’s
tumultuous retail environment. We’ve discussed the power of becoming a data driven decision-making
culture, and shown how access to accurate, scalable, and actionable data can help retailers set a roadmap to
success through a better understanding of their customers and of their store operations. We’ve also covered
how data can reveal exposures as well as opportunities for the retailer. Knowing who is not purchasing and
why can be as important as understanding those who do purchase. The right insights enable a closer,
stronger relationship with consumers.

REFERENCES
[1] Katal, A., Wazid, M., & Goudar,
R. H. (2013). Big Data: Issues, Challenges, Tools and Good Practices. IEEE, 404-409.
[2] Kaisler, S., Armour, F., Espinosa, J. A., & Money, W. (2013). Big Data: Issues and Challenges
Moving Forward. International Conference on System Sciences (pp. 995-1004). Hawaii:IEEE
Computer Soceity.
[3] R. Smolan and J. Erwitt. The Human Face of Big Data. Sterling Publishing Company Incorporated,
2012.
[4] Undefined by Data: A Survey of Big Data Definitions, by Jonathan Stuart Ward and Adam Barker,
School of Computer Science, University of St. Andrews, UK, 2013. Available at:
http://arxiv.org/pdf/1309.5821v1.pdf

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[5] http://mike2.openmethodology.org/
[6] R. Smolan and J. Erwitt. The Human Face of Big Data.Sterling Publishing Company Incorporated,
2012.
[7] Sagiroglu, S.; Sinanc, D. ,(20-24 May 2013),”Big Data: A Review”
[8] Dr. Gagandeep Jagdev, “Analysis and Application of Big Data in Retail sector intended for revenue
growth” at National Conference FPIIT-2015 at D.A.V. College, Abohar.

[9] Gagandeep Jagdev et. al., “Affirmative aspects of Big Data assures new revolution in retail
sector” at National Conference RTEST-2016, Rayat-Bahra University, Mohali, ISBN – 978-93-
8493582-5.

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IT-157

A REVIEW ON DATA MINING

SHAFFY GOYAL NAMISHA MODI

M.Tech. Scholar Assistant Professor

GZSCCET Bathinda GZSCCET Bathinda

Abstract - Data mining is the process of identifying and extracting hidden relationships among the data that are useful in
some form. It is a powerful new technology with great potential to help companies to focus on the most important
information in their data warehouses and use it to make proactive and knowledge driven decisions. It presents knowledge in
a form which is easily comprehensible to humans. This paper presents an overview of the data mining , data mining process,
need for data mining, data mining architecture, data mining techniques, data mining applications and issues in data mining.

Keywords – information ; data mining ; architecture ; techniques; applications.

I. INTRODUCTION

Data mining refers to extracting or "mining" knowledge from large amount of data[10]. It is similar to finding
minerals from their ores. Data mining can capture the data from any of the sources like datasets, multimedia,
web etc. The information that is extracted can be used in decision support systems, prediction systems,
forecasting and other related areas. The extracted pattern must be valid, useful and understandable.

II. DATA MINING PROCESS

The data mining process is a vital component of Knowledge Discovery Database (KDD). The following steps
illustrate the process:

1. Identify goals: This step deals with identifying the requirements of the person and hence formulating
goals to achieve the same. Different techniques are applied for different goals.

2. Collect data: After the goals have been identified, the data is collected from various external sources in
the form of datasets.

3. Preprocess data: This step generally deals with applying pre-processing operations on the data i.e.
cleaning and integrating data. Cleaning generally involves removal of noise and irrelevant data whereas
integration puts together all the data at one place.

4. Data transformation: This step converts the data into files that can be easily understood by the data
mining tools. Every tool has its own file format.

5. Applying techniques: In this step, various data mining techniques like classification, clustering,
association etc. are applied on the dataset.

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6. Pattern evaluation: This step usually deals with evaluating the patterns in the dataset after applying
the techniques on them.

7. Knowledge flow: This is the last step in which the knowledge flow is visible to the user.

Figure 1. KNOWLEDGE DISCOVERY PROCESS[1]

III. NEED FOR DATA MINING

Data mining plays a very vital role in determining the future trends, customer behaviours, forecasting and other
related tasks. The results provided by data mining help in taking decisions quickly for large business
organizations. It can extract predictive information that even the experts can fail to provide.

Traditional database systems are used to answer “What” type of queries but data mining is used to answer
“Why” type of queries[1].

IV. DATA MINING ARCHITECTURE

The following figure shows the data mining architecture:

Figure 2. DATA MINING ARCHITECTURE[1]

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 Data Warehouse: It contains the data for organizations and users can fetch the data from here.
 Data Repositories: Can be data warehouse, database or any type of information repositories where
data cleaning and integration may be performed.
 Knowledge Base: It contains the domain knowledge in the form of rules and heuristics from where
mining takes place.
 Data Mining Engine: It consists of various modules that help in data mining essentially classification,
clustering etc.
 Pattern Evaluation: The patterns are evaluated from the knowledge mined in the database.
 User Interface: It serves as an intermediate between the users and the data mining system. The users
can specify queries to the system and also view the datasets and knowledge flow in them.

V. DATA MINING TECHNIQUES

Data mining techniques are broadly classified into three categories:

A. PREDICTIVE TECHNIQUE

It uses the value of some variable to predict the future value of other variables[1]. For example the value of
humidity can be used to predict the temperature of day.

 Classification: This method generally deals with classifying the data into predefined classes or groups.
It involves algorithms such as bayesian network, decision table, nearest neighbour etc. For example we
can apply classification in an application that “given the bad weather conditions for 10 days, predict the
weather in future”. In this case, we can classify the data into 2 classes namely “bad” and “good”.

B. DESCRIPTIVE TECHNIQUES

It characterize the general properties of the data in the database. Example: from shopping data we conclude that
children love to buy chocolate and toys than cloths[1].

 Clustering: It is a data mining technique that helps to put the similar data items in groups called as
“clusters”. The clustering technique defines the classes and puts objects in each class, while in the
classification techniques, objects are assigned into predefined classes[1]. For example we have to
maintain a hospital database and there are large number of patients suffering from different types of
diseases. In this case, we can group the records of patients having similar disease under one cluster and
so on. This will help to manage the records efficiently and also make them easy to find.

 Association: Association is one of the best known data mining technique. In association, a pattern is
discovered based on a relationship between items in the same transaction[1]. For example based on
history of shopping data, shopkeepers might find out that people always buy accessories when they buy
clothes, so they can keep accessories alongside clothes to save time of customers as well as increase
their sales.

C. SEQUENTIAL PATTERN ANALYSIS

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Sequential pattern analysis or visualization is becoming too popular these days as it can identify or discover
trends in business data over a definite period.

This can help in proposing a recommender system to the customers based on their past buying patterns. In this
way, the businesses can get expanded and earn profit.

VI. DATA MINING APPLICATIONS

Data mining is used widely today due to its applications in diverse areas. The following are some of them:

1. MARKET BASKET ANALYSIS

Market basket analysis is a modelling technique based upon a theory that if you buy a certain group of items you
are more likely to buyanother group of items. This technique may allow the retailer to understand the purchase
behaviour of a buyer. This information may help the retailer to know the buyer’s needs and change the store’s
layout accordingly. This will help to attract more customers.

2. HEALTHCARE

Data mining is very useful in predicting the diseases in advance by studying the person’s biological activity.
Healthcare industry has benefitted a lot using data mining as the patients are effectively cured at the right place
and at the right time.

3. FINANCE/BANKING

Data mining can solve problems in banking and finance sectors by finding the patterns among large datasets that
are not immediately apparent to managers due to their limited skills. In this way, the banks can maintain their
profitable customers.

4. FRAUD DETECTION

Data mining can be used to build fraud detection system that works on the classification technique. The system
will be made to contain collection of fraudulent and non-fraudulent records. Upon applying the classifier, it will
identify whether a particular record is fraudulent or not.

5. CUSTOMER RELATIONSHIP MANAGEMENT

CRM has become popular recenty in which the needs of the customers are taken care of so that the
oraganization can maintain the maximum number of their happy customers. Using data mining, the past buying
patterns of customers are recorded and then the most popular products are recommended to them so that
shopping becomes easy for them.

6. INTRUSION DETECTION

Data mining can help improve intrusion detection by adding a level of focus to anomaly detection. It helps an
analyst to distinguish an activity from common everyday network activity.

VII. ISSUES IN DATA MINING[2]

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Data mining has evolved into an important and active area of research because of the theoretical challenges and
practical applications associated with the problem of discovering interesting and previously unknown
knowledge from real-world databases. The main challenges to the data mining and the corresponding
considerations in designing the algorithms are as follows:

1. Massive datasets and high dimensionality.

2. Over fitting and assessing the statistical significance.

3. Understandability of patterns.

4. Non-standard incomplete data and data integration.

5. Mixed changing and redundant data.

VIII. CONCLUSION

Data mining has become an important part of the businesses, organizations, scientists, researchers etc. It is a
random application of the data found in hidden, regularity which are not known by people in advance. Data
mining tools may be used to speed up the process of extracting useful information from large datasets.

REFERENCES

1. Paramjit Kaur, Kanwalpreet Singh Attwal “Data Mining: Review”, International Journal of Computer Science and
Information Technologies, Vol. 5 (5) , 2014, 6225-6228.

2. Anand V. Saurkar, Vaibhav Bhujade, Priti Bhagat Amit Khaparde “A Review Paper on Various Data Mining
Techniques”, International Journal of Advanced Research in Computer Science and Software Engineering,
Volume 4, Issue 4, April 2014, pp.98-101.

3. K.Kameshwaran, K.Malarvizhi, “Survey on Clustering Techniques in Data Mining”, IJCSIT, Vol. 5, 2014, 2272-
2276.

4. Aastha Joshi, Rajneet Kaur, “A Review: Comparative Study of Various Clustering Techniques in Data Mining”,
IJARCSSE, Vol. 3, 2013, 2277 128X.

5. Manish Verma, Mauly Srivastava, Neha Chack, Atul Kumar Diswar, Nidhi Gupta, “A Comparative Study of
Various Clustering Algorithms in Data Mining”, International Journal of Engineering Reserch and Applications
(IJERA), Vol. 2, Issue 3, pp.1379-1384, 2012.

6. Pradeep Rai, Shubha Singh, “A Survey of Clustering Techniques”, International Journal of Computer
Applications, 2010.

7. Oded Maimon, Lior Rokach, “Data Mining AND Knowlwdge Discovery Handbook”, Springer Science + Business
Media.Inc, pp.321-352, 2005.

8. Pavel Berkhin, “A Survey of Clustering Data Mining Techniques”, pp.25-71, 2002.

9. Han, J., Kamber, M., “Data Mining Concepts and Techniques”, Morgan Kaufmann Publisher, 2001.

10. R. Agrawal, T. Imielinski, and A. Swami, “Mining Association Rules Between Sets of Items in Large Databases”,
Proceedings of the ACM SIGMOD Conference on Management of data, pp.207- 216, May 1993.

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IT-158
Review On Open Source Machine Learning Tool : WEKA
Shruti Kapil,
Research Scholar
Computer science & Engineering department
GZSCCET,Bathinda,India
[email protected]

ABSTRACT
Nowadays, each and every organisation keep record of their activities which leads to the huge
amount of data which is being stored in much different kind of databases and data
repositories besides being present on the Internet or in printed form. Previously data analysis
process is human-driven involved large amount of manual work to draw the conclusion from
large sets of data which was slow, costly and extremely intrinsic. With such amount of data
there is need for techniques and tools for better interpretation of the data stored in these
databases so that valid information can be extracted which will help in decision-making. Data
mining is the technique used to visualize and scrutinize the data and derive some useful
information from that data so that information can be used to perform some useful work.
There are variety of tools available for data mining like WEKA ,Orange, Tanagra, Rapid
Miner etc each with its strength and weakness. For applicability issue the WEKA has
achieved application both in academic and business field. This paper provides the
introduction to the WEKA ,history of WEKA and reviews the data mining approaches
performed using WEKA.

Keywords: Data mining, Classification, Clustering, Knowledge discovery in database,

WEKA, Attribute Relation File Format.

I. Introduction
The Waikato Environment for Knowledge Analysis (WEKA) is a machine learning toolkit
introduced by Waikato University, New Zealand [4][19][21]. It is an open source software
written in Java useful for research, education, academics, business and project[19].About two
decades have elapsed since the first public release of WEKA. In that time, the software has
been re-written entirely from scratch, evolved substantially and now accompanies a text on
data mining [9]. But these days WEKA enjoys a huge acceptance in various fields.

It consists of collection of machine learning algorithms for implementing data mining

algorithms.[21]. It is platform compatible i.e. can run on windows, Linux, Mac. Nowadays,
WEKA has been recognized as landmark system in data mining and machine learning and
has been downloaded 20,704 times in a weak from SourceForge.net where it has been placed
since April 2000[4][11].Giving users free access to the source code has enabled a thriving
community to develop and facilitated the creation of many projects that incorporate or extend
WEKA[4].

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1. Developer University of Waikato

2. Written in JAVA

3. Operating Windows, OS X, Linux

System
4. Platform IA-32,x86-64,java SE
5 First April,1993
Release
6. Latest September,2015
Release
7. Latest 3.7.13
Version
8. Stable 3.6.13
Version
9. Type Machine Learning
10. License GNU General Public License

11. Website www.cs.waikato.ac.nz/`ml/weka

Table 1: Introduction to WEKA.

The rest of paper is organised as follows. Section III presents the Introduction to WEKA
Workbench. Section IV explains the history of WEKA. Section V explains the user interface
to WEKA. Section VI explains about the datasets being accepted by WEKA and in Section
VII finally concludes the paper.

II. Related Work

Pooja P Rathod et.al [19]“ Review on Open Source Tool: WEKA” aims about the features of
the data mining and providing about the features of WEKA , reviews the history of the
project and ongoing development and research activities of classification and clustering
techniques for data mining and provides review of machine learning algorithms used in data
mining.
Mark Hall et. al[4] “ The WEKA Data mining Software : An Update”this article aims to
provide introduction to WEKA workbench, reviews the history of the projrct, and in light of
the recent 3.6 stable release and also briefly discussed the new features added to last stable
version (WEKA 3.4).
Trilok Chand Sharma et. al[21] “ WEKA Approach for Comparative Study of
Classification Algorithm”this paper discusses the data mining techniques to process a dataset
and identify the relevance of classification of test data. This article shows the process of
WEKA analysis of file converts and selection of attributes to be mined and comparison with
knowledge extraction of evolutionary learning.
Sunita B Aher et. al[18] “ Data Mining in Educational System using WEKA” this article
shows the use of data mining in various fields like research , projects and also in education
sector to study the performance of each student.

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Romero C. Et. al[15] “ Educational data mining : A survey from 1995 to 2005”this paper
reviewed the application of data mining to traditional educational system particularly web-
based courses, intelligent web-based educational system, learning content management
system.
Satish Kumar David et. al[20] :” Comparative analysis of Data Mining Tools and
Classifiction Techniques using WEKA in Medical Bioinformatics “ this article performs the
comparative analysis of the software tools available for performing data mining on the large
datasets and performs the various classification algorithm using WEKA in medical
Bioinformatics.
D. S. RAJPUT et al[7] : “Analysis of Social Networking Sites Using K-mean Clustering
Algorithm”Clustering is one of the very important technique used for classification of
large dataset and widely applied to many applications including social networking sites,
aircraft accidental, company performance, bank fraud detection etc. In recent days
communication paper attempts to find the large scale measurement study and analysis,
effectiveness of network sites in promoting and advertising their brand in social networking
sites significance of the proposed work is determined with the help of various surveys, and
from people who use these sites.
Carrier, Povel[3] : “ A Metholody for Evaluating and selecting Data mining Software”
described a general schema for the characterization of data mining software tools. Authors
have described a template for the characterization of DM software along a number of
complementary dimensions together with a dynamic database of 41 of the most popular data
mining tools.

III. WEKA Workbench

The WEKA is the popular suite of machine learning software written in java, developed at
the University of Waikato, New Zealand. WEKA is the open source software available under
the GNU General public License and can be easily downloaded from
Sourceforge.net[19][21].The WEKA consists of numerous machine learning algorithms and
visualisation tools which can be used for analysing the data so that data can be converted into
information. This Software is being coded in Java and the algorithms can be easily applied to
dataset. The original non-Java version of WEKA was a TCI/TK front-end to modelling
algorithms implemented in other programming languages, plus data pre-processing utilities in
C, and a Make file-based system for running machine learning experiments and was primarily
designed as a tool for analyzing data from agricultural domains but more recently fully Java-
base version ( WEKA 3) for which development started in 1997, is now widely used in many
different application areas[19]. Advantages of the WEKA are[4][19]

 Free availability under the GNU General Public License.

 Portability, since it is fully implemented in the Java programming language and thus
runs on almost any modern computing platform.
 A comprehensive collection of data pre-processing and modelling techniques.
 Ease of use due to its graphical user interfaces.

Main Features of WEKA :

 49 data pre-processing tools.

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 76 classification algorithms.
 8 clustering algorithms.
 3 algorithms for finding association rules.
 15 attribute/subset evaluators + 10 search algorithms for feature selection.
 3 graphical user interface
- Explorer
- Experimenter
- Knowledge Flow

WEKA supports several data mining tasks: data pre-processing, clustering, classification,
regression, visualization and feature selection. The WEKA accepts the data written in the
form of Attribute Relation File (.ARRF).

IV. History of WEKA

The WEKA project was funded by the New Zealand government from1993 up until
recently[4] The Original funding application was lodged in late 1992 and states the project’s
goals as “The programme aims to build a state-of-the-art facility for developing techniques of
machine learning and investigating their applications in key areas of New Zealand
economy”.[19]
The First release of WEKA focussed on the development of the user interface and
implementation was done in C language and User interface produced using TCL/TK. During
this time WEKA 1 acronym was coined and Attribute Relation Format (ARFF) used by the
system was created.[4][19].
 In 1992, WEKA 1 acronym was coined and Attribute Relation File Format used by
system was created.
 In 1994, the first release of WEKA was internal and was at beta stage.
 In 1996, the first public release of WEKA 2.1 was made.
 In 1997, WEKA 2.2 was released which included 8 learning algorithms and data pre-
processing tools written in C.
 In 1998, the final release of TCL/TK based system WEKA 2.3 was developed.
 In mid 1990s, the 100% java base WEKA 3.0 was released. This non-graphical version
of WEKA accompanied the first edition of data mining book by Witten and Frank.
 In 2003, a stable version of WEKA 3.4 was released in addition of publication of the
second edition of the book. In time between 3.0 to 3.4 the three main graphical user
interfaces was developed.
 In 2005, the WEKA development team received the SIGKDD data mining and
discovery service award.
 In 2006, Pentaho Corporation became a component of their business intelligent suite.
 In 2008, WEKA 3.6 was released which given the odd-even version numbering
scheme and considered to be feature-stable version.
 In 2015WEKA 3.7 was released and is the latest release of the WEKA.

V. WEKA Data Mining Software

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Data mining is basically Knowledge Discovery from database (KDD) [1] that attempts to
analyse and discover the hidden facts and knowledge from large database. Data mining is
computational methodology of finding examples in substantial information sets including
routines at the crossing points of manmade brainpower, machine learning, insights, artificial
intelligence and database frameworks [20]. Data mining tasks can be predictive or descriptive
[16]. Common Data Mining tasks[15] are:

i. Classification- in this the well known structures are generalised and being applied to
new data for which no classification is available.
ii. Clustering -is the task of discovering groups and structures in the data that are in some
way or another “similar” without using known structures in data.
iii. Regression - attempts to find a function which models the data with the least error.
iv. Summarisation- providing more compact representation of data including
visualisation and report generation.

Thus for performing these tasks various data mining tools are available and among them
WEKA has more acceptance. WEKA is the machine learning algorithm consists of number of
inbuilt algorithms useful for performing data mining tasks. The following sections explain
about the WEKA tool.

i. User Interface to WEKA.

Figure 1: User Interface Of WEKA.

The WEKA GUI chooser provides a user a starting point for launching WEKA main
application and supporting tools. The GUI chooser consists of four buttons, shown in figure
2,each for the WEKA applications. These buttons can be used to perform the following: [19].

 Explorer: provides an environment for exploring the data with the WEKA.
 Experimenter: provides an environment for performing experiments and conducting
statistical tests between learning schemes.
 Knowledge Flow: this interface provides the environment similar to that provided by
the explorer but with drag-and-drop interface.
 Simple CLI: this provides the command line interface that allows to directly xecute
the WEKA commands for operating system.

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ii. WEKA Explorer

Figure 2: WEKA Knowledge Explorer

As the figure 2 shows the WEKA Explorer which is being used to explore the data. Through
explorer a user can load the data presented in the format of either .CSV or .ARFF, C4.5. The
explorer window consists of six tabs each performing different functions. It is necessary to
firstly load the data before exploring it. The Figure 3 shows the six tabs present on the
explorer window.

Figure 3: Tabs of WEKA Explorer

 Preprocess : This tab choose and modify the data being acted on. The preprocess
fetch data from a file, SQL database or URL. The pre-process tab shows a histogram
for selected attribute. This tab helps to train the dataset by applying the different
filters as WEKA contains filters for Discretization, Normalisation, Resampling[19].

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Figure 4: Pre-process tab of Explorer

 Classify: This tab train and test learning schemes that classify or perform regression.
Classify tools can be used to perform further analysis on pre-processed data. A
classification model produced on full trained data. WEKA consists of all major
learning techniques for classification and regression. Learning algorithms can be
evaluated using cross-validation or hold-out set. The particular classification
algorithm can be used to classify the data depending upon some specified class.[20]

Figure 5: Classify Tab of Explorer

 Clusters: WEKA contains “Clusters” for finding a group of similar instance from
datasets. Cluster tab give access to different clustering algorithms such as K-means, a
heuristic, hierarchical clustering scheme [20]. This cluster tab leads to the clustering
algorithm available in WEKA which a user can select to perform clustering.[19]

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Figure 6: Cluster Tab of Explorer

 Associate: This tab is used to associate the attributes in the data set and provides
association rules for the data. Figure 7 shows the association between the attributes of
the data set being supplied to WEKA [20].

Figure 7: Associate Tab of Explorer.

 Select Attribute: This tab helps to select the most relevant attributes in the data.
WEKA contains several methods for searching through the space of attributes subsets,
evaluation measures for attributes and attribute subsets. Search Methods such as best-
first search, genetic algorithms, forward selection.[20]

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Figure 8: Select Attribute Tab of Explorer

 Visualize: Visualization tab shows a matrix of scatter plots. Practically visualisation

is very useful which helps to determine the learning problem difficulties. WEKA
visualizes single dimension (1D) for single attributes and double dimension (2D) for
pair of attributes.[19]

Figure 9: Visualize Tab of Explorer.

VI. Projects Based on WEKA

There are number of software projects available that make use of WEKA, allow data in
ARFF format to processed, or enable access to WEKA functionality from other
programming environments[4][21]. At the time of this writing, there are 69 such projects
listed on the Related projects web page of the WEKA site
“http://weka.wikispaces.com/Related+Projects” Some of the projects may be as follows:

 Systems for natural language processing : There are number of techniques available
that used the WEKA for the process of natural language processing. GATE is a NLP
workbench[2][19], Balie is the Baseline Information Extraction performs language
detection, boundary detection [6][19].

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 Knowledge discovery in biology: BioWEKA is an extension to WEKA for the task

which it performs in biology, biometrics, biochemistry[13]. Prompt performs the
statistical comparison and mapping of protein sets.
 Distributed and parallel data mining: There are numerous projects available which
provides the facilities for distributed data mining. WEKA-parallel, WEKA4WS[10].
 Open-source data mining systems: Several well known open-source data mining
systems provide plugins to allow access to WEKA’s algorithms. The RapidMiner [20]
and Konstanz Information Miner (KNIME) are two such systems.
 Scientific workflow environment: The kepler WEKA project integrates all the
functionality of WEKA into the kepler[5]

VII. Attribute Relation File Format

The WEKA performs the data mining tasks on the data being provided in the form of either
CSV, ARFF or CS.4 format. CSV refers to the comma separated values. An ARFF is an
ASCII text file that describes a list of instances sharing a set of attributes. This file has two
distinct section. The first section is the Header information followed the data information.
The header section contains the name of the relation, a list of attributes and their data types
whereas the data section contains the corresponding data of the relation. An example of
ARFF of the standard IRIS dataset downloaded from UCI repository.

@RELATION iris

@ATTRIBUTE sepallength Numeric

@ATTRIBUTE sepalwidth Numeric

@ATTRIBUTE petallength Numeric

@ATTRIBUTE petalwidth Numeric

@ATTRIBUTE class {Iris-setosa, Iris-versicolor, Iris-virginca}

@DATA

5.1,3.5,1.4,0.2,Iris-setosa

4.9,3.0,1.4,0.2, Iris-setosa

4.7,3.2,1.3,0.2, Iris-setosa

4.6,3.1,1.5,0.2, Iris-setosa

4.9,3.1,1.5,0.1, Iris-setosa

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4.4,2.9,1.4,0.2, Iris-setosa

5.0,3.4,1.5,0.2, Iris-setosa

VIII. Conclusion
The WEKA toolkit has come as long 23 years that have elapsed since its inception in 1992. It
has enjoyed the huge amount of acceptance as compared to other data mining tools available.
As in today’s world where an organisation is data rich but poor in information so in that case
it become very crucial need to use the data mining so that data stored in the database can be
analysed and can be converted in useful information useful in decision-making for an
organization. Thus number of open source data mining software are available and among
them WEKA has huge acceptance due its key features.

References
[1].J. Hafner, H. Sawhney, W. Equitz, M. Flickner, and W. Niblack, “ Efficient Color
Histogram Indexing for Quadratic Form Distance Functions”, IEEE Transcations on Pattern
Analysis and Machine Intelligence, vol 17,no.7,pp. 729-736,1995.

[2].R. Gaizauskas, H. Cunningham, Y. Wilks, P. Rodgers, and K. Humphreys. GATE: an

environment to support research and development in natural language engineering. In In
Proceedings of the 8th IEEE International Conference on Tools with Artificial Intelligence,
pages 58–66, 1996.

[3].Carey , B. Marjaniemi, Sautter D., “ A Metholody for Evaluating and Selecting Data
Mining Software” International Conference on System Sciences- vol. 6, 1999.

[4]. Mark Hall, Eibe Frank, Geoffrey Holmes, Bernhard Pfahringer , Peter Reutemann “ The
WEKA Data Mining Software: An update” SIGKDD Explorations, Vol. 11,2004.

[5].I. Altintas, C. Berkley, E. Jaeger, M. Jones, B. Ludscher, and S. Mock. Kepler: An

extensible system for design and execution of scientific workflows. In In SSDBM, pages 21–
23, 2004 [1 kepler].

[6].D. Nadeau. Balie—baseline information extraction : Multilingual information extraction

from text with machine learning and natural language techniques. Technical report,
University of Ottawa, 2005.

[7].D.S Rajput “ Analysis of Social Networking Sites Using K-means Clustering” volume
190 of NATO Science Series, Series III: Computer and System Sciences,pages 227–249. IOS
Press, Amsterdam, The Netherlands,2005.

[8]. I. H. Witten and E. Frank. Data Mining: Practical Machine Learning Tools and
Techniques. Morgan Kaufmann, San Francisco, 2 edition, 2005

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[9]. I. H. Witten and E. Frank. Data Mining: Practical Machine Learning Tools and
Techniques. Morgan Kaufmann, San Francisco, 2 edition, 2005.

[10]. D. Talia, P. Trunfio, and O. Verta. Weka4ws: a wsrfenabled weka toolkit for distributed
data mining on grids. In Proc. of the 9th European Conference on Principles and Practice of
Knowledge Discovery in Databases (PKDD 2005, pages 309–320.Springer-Verlag, 2005.

[11]. G. Piatetsky-Shapiro. KDnuggets news on SIGKDD service award

http://www.kduggets.com/news/2005/nl3/2i/html,2005

[12].R Development Core Team. R: A Language and Environment for Statistical Computing.
R Foundation for Statistical Computing, Vienna, Austria, 2006.ISBN 3- 900051-07-0.

[13].Jiawei Han and Micheline Kamber, Data Mining Concepts and Techniques, 2nd ed.,
Morgan Kaufmann publishers, SanFrancisco, 2006.

[14]. J. E. Gewehr, M. Szugat, and R. Zimmer. BioWeka— extending the weka framework
for bioinformatics. Bioinformatics, 23(5):651–653, 2007.

[15]. Romero C. And Ventura S. “ Educational Data Mining : A Survey from 1995 to 2005”
Expert systems with Applications ,2007.

[16]. A. Ghoting, S. Parthasarathy & M.E. Otey “ Fast mining of distance-based outliers in
high-dimensional datasets”, Data Mining & Knowledge Discovery, 2008,16,pp,349-364.

[17].Nikita Jain, and Vishal Srivastava “ Data Mining Techniques: A Survey Paper”,IJRET
EISSN:2319-1163,2011

[18]. Sunita B Aher, Lobo L.M.R.J “ Data Mining in Educational System using WEKA”
IJCA, 2011.

[19]. Pooja P Rathod, Pooja P Parekar and Suraj G. Gupta “ Review on Open Source Tool:
WEKA” IJRIEST,2012

[20]. Satish Kumar David, T.M. Saeb and Khalid AI Rubeaan “ Comparative Analysis of
Data Mining Tools and Classification Techniques using WEKA in Medical Bioinformatics”
IISTE, Vol. 4,2013.

[21].Trilok Chand Sharma, Manoj Jain “WEKA Approach for Comparative Study of
Classification Algorithm” IJARCCE Vol.2,April 2013.

[22]. Deepak Sinwar and Rahul Kaushik “ Study of Euclidean and Manhattan Distance
Metrics using Simple K-Means Clustering”, IJRASET-9653, May 2014.

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IT-161
“BIOMETRIC IDENTIFICATION USING IRIS
RECOGNITION”
*Rechu Sharma **Vaneet Mohan

*Student, Deptt. of Computer Science and Engineering,

GZSCCET BATHINDA
[email protected]

**Assist. Professor, Deptt.of Computer Science and Engineering ,GZSCCET BATHINDA.

[email protected]

Abstract—
Biometric Recognition is one the most appropriate and up-to-date identification technique
beings used in different fields due to uniqueness of the various physiological and behavioral
traits like finger prints, hand geometry, face recognition, iris recognition, voice recognition,
handwriting etc. Iris recognition system provides genetically unique patterns that give a
strong aspect for identification of a living being.

Keywords—Biometric recognition, Iris recognition, Acquisition, Circular Houghman

Transform, Hamming distance .
Introduction
Biometrics refers to the identification or authentication of an individual based on certain
unique features or characteristics. There are two categories of biometric identifiers namely
“physiological” and “behavioral” characteristics. Iris, fingerprint, DNA, etc. belong to the
former whereas typing, and rhythm, voice, etc. belong to the later.

A biometric system usually functions by first capturing a sample of the feature, such as
capturing a digital colored image of a face to be used in facial recognition or a recording a
digitized sound signal to be used in voice recognition. The sample is then transformed into a
biometric template using some sort of mathematical function which can be used for
comparisons with all the existing templates in the database.

A good biometric is one which uses a feature that is highly unique. This reduces the chances
of any two people having the same characteristics. The feature should also be stable so that it
does not change over the period of time.

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LITERATURE SURVEY
Since biometric authentication is a very up to date technique being used for security and
identification purposes, plenty of work is done on it.Tieniu Tan and Zhenan Sunhas proposed
the iris acknowledgment calculation taking into account PCA (Principal Component
Analysis) is initially presented and after that, iris picture combination technique is displayed.
Kefeng Fan has proposed a productive procedure on iris picture procurement, iris de-nosing,
iris limitation, and quality appraisal. Lye Wi Liam proposed a system consisting of two parts:
Localizing Iris and Iris Pattern Recognition. They used digital camera for capturing image;
from the captured images Iris is extracted. V Saishanmuga Raja, proposed a method for
personal recognition based on iris recognition using Genetic algorithm and Neural Network.
The process of iris recognition consists of localization of the iris region and age group of data
set of iris images followed by iris pattern acknowledgment. A Neural Network is used to
reduce the low recognition rate, low accuracy and augmented time of recovery. Xingguang Li
Z.Wei has proposed the comprehensive assessment of iris image quality to assess the overall
quality score of an iris image. The paper has contributed for three aspects: (i) Three
approaches for estimating quality metrics. (ii) Proposed a fusion method to combine six
quality factors of an iris image into a unified quality score. (iii) Proposed a statistical
quantization method to classify the iris images in a database into a number of quality
factors.Chengqiang Liu Mei Xie proposed Direct Linear Discriminant Analysis (DLDA)
which consolidates with wavelet change to concentrate iris highlight. Dr. Ekta Walia has
worked on comparing the different biometric techniques and has given the clear view of
accuracy received by each one of them. Zhaofeng He, Tieniu Tan has given a detailed study
on segmentation of image of iris which extracts only the required features and discards the
unwanted features
IRIS BIOMETRICS
The iris is a thin circular structure in the eye. Its function is to control the diameter and size of
the pupil and hence it controls the amount of light that progresses to the retina. A front view
of the iris is shown in Figure 1.1 To control the amount of light entering the eye, the muscles
associated with the iris (sphincter and dilator) either expand or contract the center aperture of
the iris known as the pupil. Iris of every person has unique genetical organization which
makes it best for identification and authentication. Iris of person’s left and right eye too have
different pattern and remains the same for a long period of time.

IRIS RECOGNITION

The iris is a well-protected organ that is externally visible and whose genetic patterns are
very unique and remain stable throughout the person’s life. Its high uniqueness and stability
make it a good biometrics. The unique patterns can be extracted using image processing
techniques employed on a digitized image of the eye and then the results can be encoded into
a biometric template which can later be stored in a database for future comparisons. The
biometric template is usually created using some sort of mathematical operations. This
biometric template is compared with all the other pre-existing templates in the database using
certain matching algorithms in order to get the identification of the individual. If the image

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matches correctly with the stored image then it gives you the required accuracy and provides
authenticity.

Fig 1.1 Eye showing iris and pupil

Iris recognition process includes various tasks like acquisition, segmentation, localization,
normalization, encoding and matching.

Fig 1.2 Iris recognition Process

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Image Acquisition:

Acquisition basically means getting the information from the source.Image of iris of the
person can be acquired by image sensors etc which take care of various aspects like
resolution, sensitivity, intensity of image etc.

Image Segmentation:

It is the process of obtaining different segments of the eye like pupil diameter, eyelashes, and
eyelid etc. so that all the relevant and irrelevant information can be sorted out for future
processing. It will increase the efficiency and thus save time. Segmentation includes applying
edge detection method also that finds the pixels denoting the edges etc by fixing a threshold
value. If the gradient is above the threshold value then it is accepted as an edge, if it is below
the gradient then it is rejected and if it is between the two threshold values then it is accepted
if it touches an accepted pixel. Canny edge detection method is used for the pixels.

Canny edge detection method

Edge detection is an image processing technique for finding the boundaries of objects within
images. It works by detecting discontinuities in brightness. Edge detecting an image
significantly reduces the amount of data and filters out useless information, while preserving
the important structural properties in an image.

The working steps of canny edge detector are given as:

Step1- Filter out any noise. The Gaussian filter is used for this purpose.
Step2- Find the intensity gradient of the image.
Step3- Non-maximum suppression is applied. This removes pixels that are not considered to be part
of an edge. Hence, only thin lines (candidate edges) will remain.
Step4- Hysteresis: The final step. Canny use two thresholds (upper and lower):
a) If a pixel gradient is higher than the upper threshold, the pixel is accepted as an edge
b) If a pixel gradient value is below the lower threshold, then it is rejected.

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c) If the pixel gradient is between the two thresholds, then it will be accepted only if it is
connected to a pixel that is above the upper threshold.

Image Localization:

Localization focuses on obtaining biometric template for various coordinates of the image. It
can be obtained by using number of transformation functions like Hough man transform
function etc.

Circular Hough man Transformation

The simplest case of Hough transform is the linear transform for detecting straight lines. In
the image space, the straight line can be described as y = mx + b where the parameter m is the
slope of the line, and b is the intercept (y-intercept). This is called the slope-intercept model
of a straight line. In the Hough transform, a main idea is to consider the characteristics of the
straight line not as discrete image points (x1, y1), (x2, y2), etc., but instead, in terms of its
parameters according to the slope-intercept model, i.e., the slope parameter m and the
intercept parameter b. In general, the straight line y = mx + b can be represented as a point
(b, m) in the parameter space. However, vertical lines pose a problem. They are more
naturally described as x = a and would give rise to unbounded values of the slope parameter
m. Thus, for computational reasons, Duda and Hart proposed the use of a different pair of
parameters, denoted and (theta), for the lines in the Hough transform. These two values,
taken in conjunction are defined as a polar coordinate.

Fig 1.3 Circular Hough man Transformation

The parameter represents the algebraic distance between the line and the origin while is
the angle of the vector orthogonal to the line and pointing toward the half upper plane. If the
line is located above the origin, is simply the angle of the vector from the origin to this

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closest point. Using this parameterization, the equation of the line can be written as

That can be rearranged to .

Image Normalization:
It basically deals with obtaining the basic feature vector after segmentation and localization
of different parts of the iris. It deals with obtaining the gray scale image parameters. All the
parameters like accuracy, efficiency, error etc are observed with respect to normalised image.

Image Encoding and matching:

Encoding deals with encoding of unique iris patterns obtained in form of bits code by various
means like filters wavelets etc.
Matching deals with matching of the iris pattern code encoded with previously stored patterns
in the database in the form of biometric templates.

HAMMING DISTANCE:

For matching, the Hamming distance was chosen as a metric for recognition, since bit-wise
comparisons were necessary. The Hamming distance algorithm employed also incorporates
noise masking, Hamming distance are calculated between two templates by using only
important bits. The Hamming distance will be calculated using only the bits generated from
the accurate iris region, and this modified by each template. Although, in theory, hamming
distance is 0 when the result calculated on same iris templates but when put into practice this
will not occur.

Formula: Given two vectors u, v ∈Fn we define the hamming distance between u and v, d (u,
v), to be the number of places where u and v differ. Thus the Hamming distance between two
vectors is the number of bits we must change to change one into the other.

Conclusion and future scope:

Iris recognition proves to be very efficient and promising technique as it gives accurate and
reliable results. It can be easily used for authentication purposes in different fields like
medical, education, etc. We have defined the basic steps used in biometric recognition using
iris recognition. Iris recognition system gives unique results as it works on genetical structure
of iris and thus gives unique identification capability. In future different ways for the
reduction of noise or unwanted segments can be brought into consideration to increase its
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efficiency and performance. Also various methods can be incorporated for the optimization
of the feature vectors obtained during normalization as different algorithms can give different
efficiencies and different time need. To reduce the execution time and matching the best
possible outcomes optimized techniques can be used.

References

[1] Kefeng FAN, Qingqi Pei, Wei MO, Xinhua Zhao, and Qifeng Sun, “An Efficient
Automatic Iris Image Acquisition and Preprocessing System”, Proceedings of the 2006
IEEE International Conference on Mechatronics and Automation, June 25-28, 2006
Luoyang, China, pp. 1779-1784.
[2] Chengqiang Liu Mei Xie, “Iris Recognition Based on DLDA” Recognition (ICPR 2006),
20-24 Aug. 2006, Hong Kong, pp. 489-492
[3] C.R. Prashanth, D.R. Shashikumar, K.B. Raja, K.R. Venugopal, L.M. Patnaik, "High
Security Human Recognition System using Iris Images," ACEEE International Journal on
Signal and Image Processing Vol 1, No. 1, Jan 2010.
[4] Leila Fallah, Araghi, HamedShahhosseini, and FarbodSetoudeh. "IRIS recognition using
neural network." Proceedings of the International MultiConference of Engineers and
Computer Scientists. Vol. 1. 2010.
[5] P.P. Chitte, J.G. Rana, R.R. Bhambare, V.A. More, R.A. Kadu and M.R. Bendre, "IRIS
recognition system using ICA, PCA, Daugman's Rubber Sheet Model together", Int. J.
Computer Technology and Electronics Engineering (IJCTEE), vol. 2, no. 1, pp. 16-23,
February 2012.
[6] Wang Jian-ming and Ding Run-tao, “Iris Image Denoising Algorithm Based on Phase
Preserving”, Sixth IEEE International Conference on Parallel and Distributed Computing,
Applications and Technologies, PDCAT 2005, 05-08 December, 2005, Dalian, China, pp.
832-835.
[7] Wang Jian-ming and Ding Run-tao, “Iris Image Denoising Algorithm Based on Phase
Preserving”, Sixth IEEE International Conference on Parallel and Distributed Computing,
Applications and Technologies, PDCAT 2005, 05-08 December, 2005, Dalian, China, pp.
832-835.
[8] Zhaofeng He, Tieniu Tan, Fellow, IEEE, Zhenan Sun, Member, IEEE, and Xianchao Qiu,
2008, "Towards Accurate And Fast Iris Segmentation For Iris Biometrics", IEEE
Transactions On Pattern Analysis And Machine Intelligence, PP. 1-14.K. Elissa, “Title of
paper if known,” unpublished.
[9] Sun, Z., Wang, L., Tan, T.: “Ordinal feature selection for iris and palmprint recognition”.
IEEE TIP 23(9), 3922–3934 (2014).
[10] He, Z., Sun, Z., Tan, T., Qiu, X., Zhong, C., Dong, W.: Boosting ordinal features for
accurate and fast iris recognition. In: Proceedings of IEEE Computer Society Workshop
Biometrics at the Computer Vision Pattern Recognition Conference (2008)
[11] Proenca, H. and Alexandre, L.A., “Iris Recognition: An Analysis of the Aliasing Problem
in the Iris Normalization Stage”, 2006 IEEE International Conference on Computational
Intelligence and Security, Volume: 2, 3-6 Nov. 2006, Guangzhou, China, pp. 1771-1774.
[12] Dr. Ekta Walia "Analysis of various biometric techniques" IJCSIT) International Journal
of Computer Science and Information Technologies, Vol. 2 (4) , 2011
[13] Satish R Todmal, "Eyelids, Eyelashes Detection Algorithm and Hough Transform
Method for Noise Removal in Iris Recognition", International Journal of Computer
Applications (0975 – 8887) Volume 112 – No. 3, February 2015.
[14] Himanshu Srivastava, "Personal Identification Using Iris Recognition System"
International Journal of Engineering Research and Applications, Vol. 3, Issue 3, May-Jun
2013
[15] Anil K. Jain, Fellow, IEEE, Arun Ross, Member, IEEE, "An Introduction to Biometric
Recognition", IEEE TRANSACTIONS ON CIRCUITS AND SYSTEMS FOR VIDEO
TECHNOLOGY, VOL. 14, NO. 1, JANUARY 2004
[16] Weiki Yuan, Zhonghua Lin and Lu Xu, “A Rapid Iris Location Method Based on the
Structure of Human Eyes”, 27th Annual Conference of the IEEE Engineering in Medicine
and Biology Society, 1-4 September, 2005, Shanghai, China
[17] Recognition (ICPR 2006), 20-24 Aug. 2006, Hong Kong, pp. 489-492

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[18] Pan Lili, Xie Mei, “The Algorithm of Iris Image Preprocessing,” Fourth IEEE Workshop
on Automatic Identification Advanced Technologies (AutoID'05), 17-18 Oct. 2005,
Buffalo, New York, USA, pp. 134-138

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IT-162

Review paper ondetecting sybil attack in MANET using CBDS

approach.

*Gurpreet Kaur Bhullar ** Prof. Dinesh Kumar

*Department of computer science & Engineering

GZS PTU Campus, Bathinda

[email protected]

**Department of computer science & Engineering

GZS PTU Campus, Bathinda

[email protected]

Abstract:

In mobile ad hoc networks (MANETs), a primary requirement for the establishment of

communication among nodes is that nodes should cooperate with each other. In the presence
of malicious nodes, this requirement may lead to serious security concerns; for instance, such
nodes may disrupt the routing process. In this context, preventing or detecting malicious
nodes launching grayhole or collaborative black hole attacks is a challenge. This paper
attempts to resolve this issue by designing a dynamic source routing (DSR)-based routing
mechanism, which is referred to as the cooperative bait detection scheme (CBDS), that
integrates the advantages of both proactive and reactive defense architectures. Our CBDS
method implements a reverse tracing technique to help in achieving the stated goal.
Simulation results are provided, showing that in the presence of malicious-node attacks, the
CBDS outperforms the DSR, 2ACK, and best-effort fault-tolerant routing (BFTR) protocols
(chosen as benchmarks) in terms of packet delivery ratio and routing overhead (chosen as
performance metrics

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Introduction:

DUE to the widespread availability of mobile devices, mobile ad hoc networks (MANETs)
have been widely used for various important applications such as military crisis operations
and emergency preparedness and response

Operations. This is primarily due to their infrastructure less property. In a MANET, each
node not only works as a host but can also act as a router. While receiving data, nodes also
need cooperation with each other to forward the data packets, thereby forming a wireless
local area network. These great features also come with serious drawbacks from a security
point of view. Indeed, the aforementioned applications impose some stringent constraints on
the security of the network topology, routing, and data traffic. For instance, the presence and
collaboration of malicious nodes in the network may disrupt the routing process, leading to a
malfunctioning of the network operations. Many research works have focused on the security
of MANETs. Most of them deal with prevention and detection approaches to fight individual
misbehaving nodes. In this regard, the effectiveness of these approaches becomes weak when
multiple malicious nodes collude together to initiate a collaborative attack, which may result
to more devastating damages to the network. The lack of any infrastructure added with the
dynamic topology feature of MANETs make these networks highly vulnerable to routing
attacks such as black hole and grayhole (known as messages. In this case, a malicious node
(so-called black hole node) can attract all packets by using forged Route Reply (RREP)
packet to falsely claim that “fake” shortest route to the destination and then discard these
packets without forwarding them to the destination. In grayhole attacks, the malicious node is
not initially recognized as such since it turns malicious only at a later time, preventing a trust-

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based security solution from detecting its presence in the network. It then selectively
discards/forwards the data packets when packets go through it. In this paper, our focus is on
detecting grayhole/collaborative black hole attacks using a dynamic source routing (DSR)-
based routing technique. DSR [4] involves two main processes: route discovery and route
maintenance. To execute the route discovery phase, the source node broadcasts a Route
Request (RREQ) packet through the network. If an intermediate node has routing information
to the destination in its route cache, it will reply with a RREP to the source node. When the
RREQ is forwarded to a node, the node adds its address information into the route record in
the RREQ packet. When destination receives the RREQ, it can know each intermediary
node’s address among the route. The destination node relies on the collected routing
information among the packets in order to send a reply RREP message to the source node
along with the whole routing information of the established route. DSR does not have any
detection mechanism, but the source node can get all route information concerning the nodes
on the route. In our approach, we make use of this feature. In this paper, a mechanism [so-
called cooperative bait detection scheme (CBDS)] is presented that effectively detects the
malicious nodes that attempt to launch grayhole/collaborative black hole attacks. In our
scheme, the address of an adjacent node is used as bait destination address to bait malicious
nodes to send a reply RREP message, and malicious nodes are detected using a reverse
tracing technique. Any detected malicious node is kept in a black hole list so that all other
nodes that participate to the routing of the message are alerted to stop communicating with
any node in that list. Unlike previous works, the merit of CBDS lies in the fact that it
integrates the proactive and reactive defense architectures to achieve the aforementioned
goal. Variants of black hole attacks).

Literature Survey

Many research works have investigated the problem of malicious node detection in
MANETs. Most of these solutions deal with the detection of a single malicious node or
require enormous resource in terms of time and cost for detecting cooperative black hole
attacks. In general, detection mechanisms that have been proposed so far can be grouped into
two broad categories. 1) Proactive detection schemes [6]–[12] are schemes that need to
constantly detect or monitor nearby nodes. In these schemes, regardless of the existence of
malicious nodes, the overhead of detection is constantly created, and the resource used for
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detection is constantly wasted. However, one of the advantages of these types of schemes is
that it can help in preventing or avoiding an attack in its initial stage. 2) Reactive detection
schemes [13]–[15] are those that trigger only when the destination node detects a significant
drop in the packet delivery ratio. Among the above schemes are the ones proposed in [9] and
[13], which we considered as benchmark schemes for performance comparison purposes. In
[9], Liu et al. proposed a 2ACK scheme for the detection of routing misbehavior in
MANETs. In this scheme, two-hop acknowledgement packets are sent in the opposite
direction of the routing path to indicate that the data packets have been successfully received.
A parameter acknowledgment ratio, i.e., Rack, is also used to control the ratio of the received
data packets for which the acknowledgment is required. This scheme belongs to the class of
proactive schemes and, hence, produces additional routing overhead regardless of the
existence of malicious nodes. In [13], Xue and Nahrstedt proposed a prevention mechanism
called best-effort fault-tolerant routing (BFTR). Their BFTR scheme uses end-to-end
acknowledgements to monitor the quality of the routing path (measured in terms of packet
delivery ratio and delay) to be chosen by the destination node. If the behavior of the path
deviates from a predefined behavior set for determining “good” routes, the source node uses a
new route. One of the drawbacks of BFTR is that malicious nodes may still exist in the new
chosen route, and this scheme is prone to repeated route discovery processes, which may lead
to significant routing overhead. Our proposed detection scheme takes advantage of the
characteristics of both the reactive and proactive schemes to design a DSR-based routing
scheme able to detect grayhole/ collaborative black hole attacks in MANETs.

Existing work:

In mobile ad hoc networks (MANETs), a primary requirement for the establishment of

communication among nodes is that nodes should cooperate with each other. In the presence
of malicious nodes, this requirement may lead to serious security concerns; for instance, such
nodes may disrupt the routing process. In this context, preventing or detecting malicious
nodes launching grayhole or collaborative black hole attacks is a challenge. This paper
attempts to resolve this issue by designing a dynamic source routing (DSR)-based routing
mechanism, which is referred to as the cooperative bait detection scheme (CBDS), that
integrates the advantages of both proactive and reactive defense architectures. Our CBDS
method implements a reverse tracing technique to help in achieving the stated goal.
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Simulation results are provided, showing that in the presence of malicious-node attacks, the
CBDS outperforms the DSR, 2ACK, and best-effort fault-tolerant routing (BFTR) protocols
(chosen as benchmarks) in terms of packet delivery ratio and routing overhead (chosen as
performance metrics).

Proposed Work:

In existing work they have applied the CBDS approach to collaborative black hole and gray
hole identification. They have used the DSR as protocol for path discovery. In our research
work we can take this technique for Sybil type of attack. In this type of attack our network
legitimate node has several identity disorders. When legitimate node takes up the identity of
some other node. Other node may be malicious node or even another legitimate node. In such
situation we want to apply CBDS technique to identify such Sybil node. As in current work
we are taking the future work of previous research that CBDS approach can be applied to
another type of attacks as he has applied this technique to collaborative black hole attack.

Objectives:

1. Implement the MANET using DSR protocol.

2. Identify the Sybil attack
3. Using CBDS and RSS technique.
4. Compare the results on different parameters

REFERENCES

[1] P.-C. Tsou, J.-M.Chang, H.-C.Chao and J.-L. Chen, “CBDS: A cooperative bait detection
scheme to prevent malicious node for MANET based on hybrid defense architecture,”
VITAE, Chennai, India, Feb. 28–Mar., 03, 2011, pp. 1–5.

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[2] S. Corson and J. Macker, RFC 2501, Mobile Ad hoc Networking (MANET): Routing
Protocol Performance Issues and Evaluation Considerations, Jan. 1999. (Last retrieved March
18, 2013).

[3] C. Chang, Y.Wang, and H. Chao, “An efficientMesh-based core multicast routing
protocol on MANETs,” J. Internet Technol., vol. 8, no. 2, pp. 229– 239, Apr. 2007.

[4] D. Johnson and D. Maltz, “Dynamic source routing in ad hoc wireless networks,” Mobile
Computer., pp. 153–181, 1996.

[5] I. Rubin, A. Behzad, R. Zhang, H. Luo, and E. Caballero, “TBONE: A mobile-backbone

protocol for ad hoc wireless networks,” in Proc. IEEE Aerosp. Conf., 2002, vol. 6, pp. 2727–
2740.

[6] A. Belmehdi, “Avoiding black hole and cooperative black hole attacks in wireless ad hoc
networks,” Intl. J. Comput. Sci. Inf. Security, vol. 7, no. 1, 2010.

[7] S. Marti, T. J. Giuli, K. Lai, and M. Baker, “Mitigating routing misbehavior in mobile ad
hoc networks,” pp. 255–265.

[8] K. Vishnu and A. J Paul, “Detection and removal of cooperative black/gray hole attack in
mobile ad hoc networks,” Int. J. Comput. Appl., vol. 1, no. 22, pp. 28–32, 2010.

[9] K. Liu, D. Pramod, K. Varshney, and K. Balakrishnan, “An Acknowledgement based

approach for the detection of routing misbehavior in MANETs,” IEEE Trans. Mobile
Comput., vol. 6, no. 5, pp. 536–550, May 2007.

[10] H. Deng, W. Li, and D. Agrawal, “Routing security in wireless ad hoc network,” IEEE
Commun. Mag., vol. 40, no. 10, Oct. 2002.

[11] S. Ramaswamy, H. Fu, M. Sreekantaradhya, J. Dixon, and K. Nygard, “Prevention of

cooperative black hole attacks in wireless ad hoc networks,” in Proc. Int. Conf. Wireless
Netw., Jun. 2003, pp. 570–575.

[12] H. Weerasinghe and H. Fu, “Preventing cooperative black hole attacks in mobile ad hoc
networks: Simulation implementation and evaluation,” in Proc. IEEE ICC, 2007, pp. 362–367

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IT-163

Review Paper on

Comparative Analysis of Flooding, Random walk, Gossip based

Resource Discovery protocols in mp2p networks

*Ramandeep kaur ** prof. Dinesh kumar

*Department of computer science & Engineering

GZS PTU Campus, Bathinda

[email protected]

**Department of computer science & Engineering

GZS PTU Campus, Bathinda

[email protected]

Abstract—

All major mobile communication architectures are mainly centralized. When the mobile
devices are switched on it will search for nearby base station or access point. The content
being searched is mostly stored in a centralized directory manner. Peer-to-Peer platform can
be one of the best possibilities to overcome the restrictions and resolve issues incurred due to
centralization. Mobile environment poses additional challenges on such P2P networks-due to
limited resources, dynamic and wireless network characteristics, heterogeneity of nodes,
limitations on processing power and wireless bandwidth. Hence resource discovery becomes
further challenging. Even today mostly the traditional methods like flooding, random walk or
gossip based forwarding methods have to be considered along with major limitations and
drawbacks. Further in Mobile Peer to Peer (MP2P) system the energy aspect is very crucial
with regards to the participation of nodes in the system. The search failure rate may increase

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if a mobile device uses all its energy and hence not participate in the resource discovery
process. In this paper, we simulate the existing standard flooding, random walk and gossip
based resource discovery algorithms on a P2P Mobile Adhoc Network (MANET) and studied
their performance under such highly dynamic mobile network scenario.

Keywords- MANET; P2P; MP2P; flooding; random walk; gossip.

1. Introduction

P2P networks

In p2p networks consist of nodes refers to peers having equal role. P2p networks are
categorized as centralized p2p & decentralized p2p. Centralized p2p networks have
centralized directory. Hence there is Server bottleneck occurred. Decentralized p2p networks
may be structured decentralized or unstructured decentralized. Structured networks have well
organized structure is maintain by distributed hash functions. No unstructured decentralized
networks neither require centralized or strict rules for maintains of p2p networks. P2p are
fault tolerant .

Figure1. P2P network

There are three classes of P2P systems:

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Pure p2p system:In this two nodes communicate with each other without use of any central
server.

Hybrid p2p system:In this node partially depends on central server,while the communication
between nodes still takes placeautonomously.

Federated p2p system:In this nodes communication get place within pre-defined area such
as within an association [6].

P2P architectures are defined by their capability to adjust to failures and dynamically varying
network topology witha temporary population of nodes.

MANET

o Overall overhead is small because message is unicast to selected node .

o It is scalable and no broadcast storm problem occurs.
o It is appropriate with high mobility.
o It has more control over search termination.
Various disadvantage of random walk are:

o High latency due to message transfer through only single node.

o Probability to reaching resource node is low.
o It is more costly search.
Some applications of random walk are:

There are various properties of random walk which make it more useful for many applications-

o It is used in structure free networks for distributed model checking.

o It is usedto perform well-organized distributed computation of a class of decomposable functions.
o Mobile agents use random walk in ad hoc networks.

Gossiping

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In this method source node select G neighbors from neighbor’s list and send request to first
node of G then message on other nodes with gossip interval. If any neighbor node is owner of
resource it will reply otherwise request is continue. To reduce the negative effect of flooding
gossiping is used. Gossiping is more reliable method. There is low latency and no control
over search termination. Gossip nodes transferring data with some probability, Hence there is
two probability factors such as static probability if requires fixed probability otherwise called
adaptive probability. In Gossip there is consciousness among neighbor’s hence useless nodes
does node take part in transferring message to save energy [11].

Gossip message consist four fields:

o node: this contain node state information. This field consist the IP address.
o Avail: this field value indicate the availability of the resource. Large value of field indicates the
more availability of resource and less value indicate the low availability of resource.
o Create: this field indicates the message creation time.
o Expire: this shows the message expire time.
Flooding

Flooding is method in which each node broadcast the message to neighbor nodes. Each node
rebroadcast the message until message has been propagate the network. Flooding is different
from broadcasting in which transmission of message is within transmission range of
broadcasting node.

Broad storm problem

Blind flooding which causes redundancy and retransmission of messages leads to contention
and collision problem called broad storm problem. Gossip approach is more suitable method
to resolve this problem.

1. Redundant and superiors message

2. Probability of collision

3. Congestion of wireless medium

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Flooding control

Following are the different methods to control:

o Hop limits: this indicate that query will not expend to certain number of hops.
o Expansion ring scheme: there are two variant of this scheme, DSR and AODV protocols. In DSR
message is broadcast to one hop neighbor first if resource is not exist then search entire network.
In AODV node enlarge its penetrating radius linearly until resource not found.
o Geographical area: flooding is controlled by it geographical area. Nodes broadcast message to
other nodes if they are within specified area.

2. Background and Related work:

An Analysis of the Overhead and Energy Consumption in Flooding, Random Walk and
Gossip based Resource Discovery Protocols in MP2P Networks 2015.
This paper describes the p2p network. Wireless p2p networks have certain advantage over
centralized p2p networks. P2p networks now stabbing the wireless and movable domains. Initial
p2p networks was dating client. Mp2p requires different architectures like point to point network,
meshed networks, cooperative networks. But mp2p networks contain various challenges due to
p2p network work on application layer and MANET work on network layer. Ad hoc networks
have drawbacks of limited bandwidth, power consumption, and infrastructure les. MANET is
dynamic in nature so the neighbors of node changes with time hence no one will be in fix
position. Mobile nodes with its limited battery power if mobile nodes use its all energy they
becomes dead and searching will be stopped. Hence routing of mobile p2p network is challenging
factor. This paper describes the p2p network on MANET and resource discovery methods under
MANET. There is three resource discovery methods flooding, random walk, gossip approaches. It
will take gossip interval of one sec. gossip interval is a time a node wait to transmit a message to
other node. This paper measure the performance of these methods over two parameters such as
unicast in random walk and gossip which degrades the performance. It is based on AODV
protocol which is reactive protocol. It will determine path on demand when will be needed. Where
in proactive protocols build and maintain routing tables.
Issues of implementing random walk and gossip based resource discovery protocols in p2p
MANET & suggestions for improvement 2015.
A p2p network is a kind word to the usual client-server system. In a P2P system, the computing
power relies on the ends of a link rather than the complete network itself, and all nodes generally
called as "peers" have identical roles. Resource searching is one of the more difficult works in p2p
in wireless networks. This paper evaluates random walk, gossip, flooding resource discovery
methods with objective to:
 Study their performance under MANET.
 Define related issues in searching methods.

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 Suggest improving these methods for more efficient discovery.

In flooding message is send to all one hop neighbors for resource search. In random walk
message is unicast to randomly selected neighbor node hence probability to reach message at
destination is minimum because message may be lost in routing. There is no broadcasting
message is moved to one node at a time.The random walk and the gossip based methods
attempt to find out route at each and every hop while transferring messages to another
node;In gossip message is send with some probability to lower the overheads in routing
protocols. There involves periodic message transmission between nodes.Replication of
message also raises the resource discovery effort.

Disadvantage of gossip is:

o Low speed
o Unstable
o Message replication
o High delay to transfer message
MANET is challenging topology where routes are discovered on temporary basis. This paper
evaluates these resource discovery methods for various parameters as: success rate, response
time, network overheads, average energy consumption, overall packet dropped, MAC load,
hop to hop packet delay, throughput, hop to hop packet delivery ratio. This paper describes
that flooding performs well than gossip and random walk hence flooding is more energy
efficient method than random walk and gossip based resource discovery methods. This is
based on AODV protocol where it takes the neighbor list and calculates the neighbors for
each present node.

MuktaChandna, BhawnaSingla, “Comparative Analysis of Flooding and Gossiping in

Wireless Sensor Networks Using SIR ,” 2015.

This paper describes that network consist of wireless and sensing connections between the
nodes. It compares two resource discovery methods flooding and gossip algorithms. It
describes that limitations of flooding is resolved by gossip method. Wireless sensor networks
are the networks in which small size devices sense the environment to communicate. There
are two functions of sensors first sense the act according to surrounding. Wireless sensor

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networks are composes of number of sensing devices. Routing in wireless sensor network is
based on different routing algorithms.

Flooding In flooding node send the packet to neighbor of nodes. Each node stores the packet
and transmits it to other nodes. It is easy process. Round is the amount of time nodes take to
get packet and resend to their neighbor nodes.

Gossip In gossip source node send single copy of packet to a node. It avoids sending copies
to all neighbors.

Source initiated dissemination this method broadcast the packet to available path when
resources are found. Source initiated reactive based gossip method. In this process executes
as:

o Source node send the packet to neighbor node contains its time stamp, source id, sender address.
o When a node receives a packet it stores its time stamp, source address.
o When the destination node is reached it send the control message to source node.
o After receiving the control message source node select the same route for communication.
Comparison parameters taken for evaluating flooding and gossip methods are:

o Packet delivery ratio

o Energy consumption
Packet delivery ratio is calculated by number of packet send to nodes over number of packets
successfully received. This paper evaluate that in gossip have 16% high packet delivery ratio
than flooding. Energy consumption is overall energy required to send and receive message.
According to this paper flooding approach achieves 20% more energy than gossip method.
Hence this paper evaluate that gossip based sensing is best than flooding.

3. Platform used:

1. NS2(network simulator)

4. Problem formulation:

In existing paper they have taken the AODV protocol in MANET p2p type of the network.
They have done three techniques like flooding gossiping and random walk. During the
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research they have taken parameters like overhead and battery power consumed. As they
have given the result like flooding is a better technique for these two parameters. During the
research they had build the network and used three techniques for path identification
likeflooding, gossiping and random walk. All these techniques have their own drawbacks and
advantages. But while study they have taken only two factors. Major factor is energy
consumed.

In our research we will be taking DSR as routing protocol. During our research we will take
other factors like MAC Load, Throughput/Bandwidth, and Hop to Hop Delay. We will also
verify the same by varying the mobility and study their impact on such high density network.
By doing this we will be having better results that which technique will be having what
result. Then later we can say that which technique has better results in terms of different
factors. We will also check the techniques performance on different mobility and different
network densities

5. Parameters used:

1. MAC Load
2. Throughput/Bandwidth
3. Hop to Hop Delay

6. Objectives:
1. Implement the network with different mobility.
2. Implement the network of different densities.
3. Implements the techniques like flooding gossiping and random walk.
4. Implements the factors like MAC Load, Throughput/Bandwidth, Hop to Hop Delay.

References

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[1]. Ajay Arunachalam, Ohm Sornil, “An analysis of the overhead and energy
consumption in flooding, random walk, gossip based resource discovery methods,” 2015.

[2]. Ajay Arunachalam, Ohm Sornil, “Issues of implementing random walk and
gossip based resource discovery protocols in p2p MANET & suggestions for
improvement,” 2015.

[3]. MuktaChandna, BhawnaSingla, “Comparative Analysis of Flooding and Gossiping in

Wireless Sensor Networks Using SIR ,” 2015.

[4] ChaitaliBiswasDutta , UtpalBiswas “ A Novel Blackhole Attack for Multipath

AODV and its Mitigation,” 2014.

[5] S. Kaur ,S. K. ,C. S. , “An Overview of Mobile Ad hoc Network: Application,
Challenges and Comparison of Routing Protocols,”s 2013.

[6] AnkurGupt, Lalit K., “ peer to peer networks and computation: current trends and
future perspectives,” 2013.

[7] Rodolfo Oliveira, Luis Bernardo, Paulo Pinto, “flooding techniques for resource
discovery on high mobility MANETS,”
[8]. L. Zhang and J. Liu, “Efficient Search Scheme in Mobile Peer-to Peer Network,”
aug., 2012.

[9]. Tsung-Chuan Huang, Sheng-Chieh Chen, Lung Tang , “Energy aware gossip routing
for mobile ad hoc networks,” 2011.

[10] R. Motta and J. Pasquale, “Wireless P2P : Problem or Opportunity ?,” no. c, pp. 32–
37,2010.

[11] C. E. Perkins, M. Park, and E. M. Royer, “Ad-hoc On-Demand Distance Vector

Routing.” 297

[12]. Prof. Roberto Baldoni (Advisor), Dr. Roberto Beraldi (Co-Advisor), Prof.
GiacomoCio±, “Distributed Search and Service Discovery in Wireless Ad Hoc Networks
using Random Walk,” 2008.

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[13] Krishna Gorantala, “Routing Protocols in Mobile Ad-hoc Networks,” 2006.

[14] AmitShrivastava , Aravinth Raj Shanmogavel , AvinashMistry, NitinChander,

PrashanthPatlolla , VivekYadlapalli , “Overview of Routing Protocols in MANET’s and
Enhancements in Reactive Protocols,” 2005.
[15] M. C. Castro and A. J. K. C. Chiasserini, “Peer-to-Peer Overlay in Mobile Ad-hoc
Networks,” pp. 1–37.
[16] Jagtarsingh, Nitashadhiman, “ A Review Paper on Introduction to Mobile Ad Hoc
Networks,” IJLTET.

IT-164

Impact of Resource sharing and Networking in public library

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* Dr. Kirti Singh (Librarian)

SSD Women’s Institute of Technology, Bathinda

E mail: [email protected]

M. no. 9888470848

Abstract
Library cooperation, resource sharing and networking are used interchangeably as
synonymous terms for collaborative efforts of information exchange among libraries. The
role of a public Library in different phases of development has proved as a crucial intranet of
social change. It is believed that where formal education ends informal education begins and
this lifelong learning process in continued with the support of free public library service.

This is possible when public libraries are computerized and networked could be shared by
anther library for the benefit of the users.

This paper deals with library resources and net working. This paper commences with a
theoretical treatise on the topic like need, objectives, advantage of library networking and
services offered through it. It is immediately followed by and illustration on the technologies
involved. Signification of standardin networking for the interchange of information libraries.

Introduction

Library is a growing organization. Any growing organization will have set a goal to be
achieved, which is attained through appropriate plainly. The case of public library is no
exception.

Public Library system may be defined as an organized structure of related service units which
each unit discharges its predetermined role as an integral part of the system. A Public Library
is an instrument which provides opportunity for perpetual self development and extension of
knowledge of the community.

Today Library is a widespread vital service institution. The new attitude of public library is to
carry its massage out to the people who are stile unaware of it. According to the UNESEO

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without public library Support there can be no democracy, No real freedom of mind of body.
It is a property of people and in a modern society.

Public libraries are not supposed to make any distinction between the caste, creed, race, sex
and nationality. Ina developing country, the need for a good public library system has been
long understood but it’s all vending activities have not yet been defined.

Public Library as the local centre of information is also described as the local gate way to
knowledge providing for lifelong learning independent decision making and culture
development of the individual and the social groups. The public library movement has a long
history is our country.

Role of Resource sharing in public library

Cooperation among library is the foundation for sharing of resources. Library cooperation is
age old. It can be traced back to 200 BC when Alexandria library shared its resources with
peg mum library while resource sharing picked up in 1910. Net working of library using
computer and communication facilities become a reality in 1970.

Information explosion the rise in cost of publication the dwindling financed position of
library limitation of space in library impact of Technological advances in communication and
location of library in distant and remote areas necessitated the need for resource sharing and
networking of public libraries.

Areas of Resource Sharing

 Inter library loan (ILL)

 Acquisition
 Cataloguing
 Personnel
 Information Services
 Translation Service
 Development of special collection
 Cooperative Storage
 Barriers to Resource sharing.

Barriers to Resource Sharing

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There are many barriers to resource sharing both in the normal context and in the electronic
environment. Some of these are:

 Fear or unwillingness among the library staff about the new arrangement. They at times resist
it as they are not willing to take extra burden of inter-library loan or other related activities.
 Restrictions imposed by the authorities: Some authorities insist that library materials should
not be shared with other libraries.
 Lack of facilities to support resource sharing: Libraries many not have copying facilities or
electronic document delivery systems.
 Communication problems: Long distance between participating libraries impedes smooth
functioning of the resource sharing system. In the electronic environment too the poor
communication links stands as a perennial problem in developing countries like India.
 Lack of funds: Lack of fund for automation, networking, inter-library loan operation etc.
stand in the way of resource sharing.

Public Library Networking

Network (consortiums or cooperatives) is one of the organizational arrangements for

achieving the objectives of resource sharing. When two or more libraries and/or other
organizations are engaged in a common pattern of information exchange, through
communications, for some functional purpose, it is called library network. Libraries may be
in different jurisdictions but agree to serve one another on the same basis as each serves its
own constituents.

The formal dictionary meaning of network is a connected system. A library network means a
system under which libraries are connected, obviously for resource sharing. Technical
dictionary definition of network implies computer and communication links that permit
computers to communicate with each other and to share programs, facilities, data and
knowledge bases. A network can be local (one room, one office, one institution), national or
even international.

One often comes across various terms as computer network, library and information network
and communication network. Communication networks (like TELENET, TYMNET,
DIALNET) Are channels of transmission of data which are carried through the telephone
lines/microwave/satellite, to which the computer network switches on to. Send/receive
information/data.

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Computer network, on the other hand, is a category of computer system wherein multiple
computers are interconnected,the purpose of computer among various users that (like
databases, software, computing resources) of all computer among various users that are
connected to the network. For example, in India, we have computer networks like NICNET,
INDONET, ERNET etc). Library/information network is distinct from computer network. It
is computer-based (i.e. computer network-based) network, of library/information centers. In
other words, library network is a network is a network of database of various
library/information centers connected through computer network to facilitate sharing of
resources. Generally when we mention a network it implies the computer network to facilitate
sharing of resources. Generally when we mention a network it implies the computer network-
based library and information network (like DELNET. INFULIBNET, CALIBNET etc.).

In short, a library network can be defined as "two or more libraries engaged in a common
pattern of information exchange, through communications, for some functions or purposes. A
network usually consists of formal arrangement whereby materials, information and services
provided by a variety of libraries are available to all potential users.

Network- Based Services

Following are the network-based services offered by libraries:

 Catalogue services: shared cataloguing union. catalogue online catalogue access of the shared
database retro conversion of bibliographical data,
 Database services: reference and referral services:
 Bibliographical database services: retrospective searches: SDI services; CAS.
 Document supply services Inter-library loan: Document delivery,
 Collection development: Cooperative selection and procurement,
 Communication-based services: Electronic mail/bulleting boards/discussion groups. File
transfer,
 Computer conferencing and interactive video conferencing,
 Wed OPAC

Library Networks in India

The major development in establishment of library network in India took place, though late,
during mid 1980s as a result of Government of India's efforts towards creation of data
networks like NICNET, ERNET, INDONET, SIRNET and VIKRAM.NICNET IB satellite.
ERNET is the computer network for the academic and research community providing e-mail,

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file transfer, remote log in, database access and bulletin board. INDONET, a commercial
computer network connected to various communities, is designed to provide access to
computing and software resources of CMC Ltd. To the public usersVIKRAM is a packet-
switched public data network providing remote access points, all connected by leased or dial-
up lines? SIRNET (Scientific and Industrial Research Network) is expected to interconnect
all CSIR laboratories and other R&D institutions in India. Setting up of the data/computer
network facilitated organization of library and information networks.

Public Library Networks in India

Public libraries by the very fact that they are most underdeveloped are yet to make a mark in
networking in India. Let alone networking, the public libraries in India are not even
computerized. A recent survey of application of IT in public libraries showed that only 8 per
cent of the libraries are computerized 28 per cent planned to introduce automation and the
rest (64%) have had no plans at all. They are all, however, aware of the paramount
importance of computerization. There may be a couple of islands in India in this respect,
which one may say,, have attempted to take a. step into this field.

DELNET

Developing Libraries network (DELNET). Formerly known as Delhi Library network, is one
of the early networks (1988) in India. The National Informatics Centre, ministry of
Information Technology. Government of India and India International Centre, New Delhi are
currently promoting DELNET. It may be noted is not an exclusive network of public
libraries.

Other Library Networks in India

A few of the other than public library networks in India are being treated below. This is not
an exhaustive but an illustrative list of such networks.

CALIBNET

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The first library network to be set up in India was the Calcutta Library network
(CALLIBNET) in 1993. It was meant to introduce a cost effective modernistic means to
provide information support to academic. Research and other scholar, pursuits to help
officials, functionaries and decision makers as well as.

MALIBNET

Madras Libraries Network is a network of libraries in and around Chennai set up under the
initiative of INSDOC in 1993. Membership is awarded to universities, colleges, R & D
institutions. Industrialist and individuals on paying suitable membership fee.

INFLIBNET

INFLIBNET is a project sponsored by the UGC to link the libraries and information centers
in universities, deemed universities, institutions of national importance, UGC information
centers, R&D institutions and college libraries in institutions affiliated to CSIR, ICMR,
ICAR, DRDO and other government departments It endeavors to put together all existing and
anticipated information resources in standard and machine readable form and make it
accessible for search from almost any place in the country..

The major objectives of INFLIBNET are to: Evolve national network

Create online Union Catalogue

 Provide access to databases

 Establish resource centers
 Encourage share cataloguing
 Implement computerization

BONET

Bombay Library Network aims to promote cooperation between libraries in Mumbai. It offers
training related to library computerization and networking. Participating libraries contribute

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to make BONET funding self-sufficient. It provides access to centralized catalogues and e-

mail facility to its members.

RECNET

Regional Engineering Colleges Network intends to provide access to the resources of 17

Regional Engineering Colleges in the country. It was formed in 1996. Under the consortium,
all members of RECNET create their library data in the electronic form, which is merged
with the union catalogue semiannually. Response to queries/requirements from any member
of the network is sent within 10 days. This network is still in the formative stage.

Some other library networks are Pune-Network, Mulibnet, Nagnet, and Hylibnet etc.

All these networks are not strictly public library network. Mostly, these have been established
to cater to the needs of S & T and academic community.

Conclusion

While there is no tangible achievement in the field of resource sharing among public libraries
in India, there are credible performances in other libraries. Which have been detailed for the
purpose of serving as leading lights to public libraries?

The second part deals with library networking. This part commences with a theoretical
treaties on the aid topic. Like the need, objectives, advantages of libraries networking and
services offered through it. It is immediately followed by an illustration on the technologies
involved. Both hardware and software in library networking, and the significance of
standards in networking for the interchange of information between libraries.

As in the case of resource sharing, networking of the public libraries in India does not have
much to show? However, the picture is entirely different in the case of scientific libraries.
Hence networks of scientific libraries have been briefly illustrated, again to offer a lead to
public library networking. The Unit also gives a glimpse to account of the role played L%
internet in sources sharing and networking.

As the case of resource sharing and networking of the public library is India does not have
much to show? However the picture is entirely different in the case of scientific libraries
hence networks.

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References

1. Barua, B.P. (1986). Public Library Service in India. In: Handbook of Library,
Archives, and information Centres in India New Delhi: Information Industry Pub.
2. Community Infromation:what libraries can do. A consultative document. (1980).
Chicago: ALA. Davies, D.W. (1974). Public Libraries as culture and social centers
the origin of the concept. Metuchen, N.J.: Scarecrow.
3. Dowlin, K.E. (1978). The Technological setting of the public library. In the public
library circumstances and prospects. Chicago: univ. of Chicago press.
4. Garrison, Guy. (ed.) (1975). Total Community Library. 4'h ed. New York: Neal-
Schuman. Goswami, Inder Mohan. (1955). Development of library and information
science. New Delhi: Commonwealth pub.
5. Jolliffe, Harold. (1968). Public library extension activities. 2"d ed. London: Library
association. Maitra, satyen. (1974). Intamel Meeting: The public library and education
in India. Int. Lib Rev.6() 1 pp.55-60.
6. A neelaneghan,ed(1 972). Public library system. Bangalore Sarada rang Nathan
endowment for Lib. Sci
7. Venkatappaion, V.(1990.). Indian Library Legist ration Vol:- union Library bills and
acts vol. 11 state library bills and acts. Delhi Daya publishing House.
8. S.M. Mannan and Manik Lal BoseMalaysian: Journal of Library & Information Science,
Vol.3, no.2, December 1998: 67-86.

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APPLICATIONS OF ARTIFICIAL NEURAL NETWORKS IN

MANAGEMENT SCIENCE: A SURVEY

*Nikita Sehgal **Sukhjinder Singh

Assistant Professor, Department of Electronics & Communication Engineering

GZS Campus College of Engineering & Technology-MRS Punjab Technical University,

Bathinda-151001 (Punjab), India

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Email-id: [email protected] and 1Contact No. +91 94177-14257

Abstract: Artificial Neural Networks (ANNs) are referred as systems which can learn. A
neural system can be made to train on a set of input and output data which belongs to a
particular problem. The fields of application of ANNs have increased rapidly in the past few
years. Therefore, with only very modest information of the theory behind these systems, it is
possible to tackle complex problems in a researcher's own area of specialty with the ANN
technique. ANNs also have become an important field for business intelligence. This paper
presents basic behavior of neural networks along with its application in management sciences
as suggested by various researchers from time to time.

Keywords: Artificial Neural Networks; Network Structures; Learning Methods and Business
Applications

1. INTRODUCTION

An Artificial Neural Network (ANN) is either a hardware implementation or a computer

program which strives to replicate the information processing capabilities of its biological
exemplar. ANNs are typically self-possessed of a great number of interconnected artificial
neurons. The artificial neurons are basic models of their biological counterparts. These
networks are dispersed information processing systems composed of many simple
computational elements interacting across weighted connections [6]. ANNs can recognize
and learn correlated patterns between input data sets and equivalent target values [1,5]. After
training, ANNs can be used to forecast the outcome of new independent input data. ANNs
seek to simulate the human brain structure, human thinking and human learning in a machine.

ANNs have emerged as an influential statistical modeling technique [3]. ANNs detect the
fundamental functional relationships within a set of data and perform responsibilities such as
pattern recognition, classification, evaluation, modeling, prediction and control [5]. They take
out the crucial characteristics from the numerical data as contrasting to memorize all of it.
This offers a convenient way to reduce the amount of data as well as to form an embedded
model without having to form a physical model of the underlying phenomenon. Table 1
presents the comparison between human brain and ANN on the basis of various parameters.

Table1: Comparison between Brain and ANN

Parameter Brain ANN

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Speed Few ms Few nano sec

1011 neurons &

Size and 1015 Depends on
Complexity designer
Interconnections

Stores
information in its Contiguous
interconnection memory locations.
Storage
Capacity or in synapse. Even loss of
memory may
No Loss of happen sometimes.
memory

No fault
tolerance. In fact
Has fault
Tolerance gets disrupted when
tolerance
interconnections are
disconnected

Complicated,
Control
involves chemicals Simpler in ANN
Mechanism
in biological neuron

It depicts that neural networks have the unique capability of learning. That is, unlike
conventional computers, sequences do not need to be dictated in order for the algorithm to be
executed and produce meaningful results. This problem solving tools creates a unique
likeness to the human brain, that is, neural networks, use the interconnectedness of the
elements of the model to arrive at logical and robust decisions [5], rather than follow a set of
sequential steps, that may or may not solve the problem like computers do.

Rest of the paper is organized as follows: characteristics of the ANNs are discussed in section
2. Sections 3 and 4 present neural network architectures and learning methods respectively.
Applications of ANNs in business are discussed in section 5 and conclusions along with
future scope are drawn in section 6.

2. CHARACTERISTICS OF ANNs

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Typically, a computer operates through sequential linear processing technologies. They apply
formulas, decision rules, and algorithms instructed by users to produce outputs from the inputs.
Conventional computers are good at numerical computation [6]. But ANNs improve their own
rules; the more decisions they make, the better the decisions may become.

There are six main characteristics of ANN: the network structures, the parallel processing
ability, the distributed memory, the fault tolerance ability, the collective solution, and the
learning ability. These are briefly outlined as below:

(A) Network Structures: The network structure of ANN should not be complicated or
complex. There are mainly two types of structures namely recurrent and non- recurrent. The
Recurrent Structure is also known as Auto Associative or Feedback Network and the Non
Recurrent Structure is also known as Associative or Feed-Forward Network [2]. In Feed
Forward Network, the signal can travel in one way only whereas, in Feedback Network, the
signal can travel in both the directions by introducing loops in the network.

(B) Parallel Processing Ability:ANN is mainly introduced to expand the concept of parallel
processing in the computer field [2]. Each neuron in the ANN is a processing element similar
to a Boolean logical unit in a conventional computer chip, except that a neuron’s function is
programmable. Computations required to simulate ANNs are mainly matrix ones, and the
parallel structure of the interconnection between neurons facilitates such calculations.

(C) Distributed Memory:ANN is very huge system so single place memory or centralized
memory cannot accomplish the need of ANN system [2], so in this condition we need to store
information in weight matrix which is form of long term memory because information is
stored as patterns throughout the network structure.

(D) Fault Tolerance Ability:ANN is a very complex system so it is necessary that it should
be a fault tolerant [6]. Because if any part becomes fail it will not affect the system as much
but if the all parts fails at the same time the system will fails completely [2].

(E) Collective Solution:ANN is an interconnected system; therefore the output of a system is

a collective output of various inputs [3], so the result is summation of all the outputs which
comes after processing various inputs.

(F) Learning Ability: In ANN, most of the learning rules are used to develop models of
processes, while adopting the network to the changing environment and discovering useful
knowledge [2]. These Learning methods are Supervised, Unsupervised and Reinforcement
Learning.

3. NEURAL NETWORKS ARCHITECTURES

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An ANN is defined as a data processing system consisting of a large number of simple highly
interconnected processing elements (artificial neurons) in architecture enthused by the
structure of the cerebral cortex of the brain. There are several types of architecture of NNs.
However, the two most widely used NNs are described below:

(A) Feed Forward Networks: In a feed forward network, information flows in one direction
along connecting pathways, from the input layer through the hidden layers to the final output
layer (refer figure 1)[1]. There is no feedback (Loops) i.e., the output of any layer does not
affect that same or preceding layer.

Fig.1:A Multi - Layer Feed Forward Neural Network

(B)Recurrent Networks: These networks differ from feed forward network architectures in
the sense that there is at least one feedback loop [3]. Thus, in these networks, for example,
there could exist one layer with feedback connections as shown in figure 2 below. There
could also be neurons with self feedback links, i.e. the output of a neuron is fed back into
itself as input [1].

Fig 2: Recurrent Network

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4. LEARNING METHODS

Learning/training methods in neural networks can be broadly classified into three basic types:
supervised, unsupervised and reinforced and these are briefly outlined below (Refer figure 3):

Fig.3: Types of Learning

(A) Supervised Learning: In this, every input pattern that is used to train the network is
associated with an output pattern, which is the target or the desired pattern [3,6]. A teacher is assumed
to be present during the learning process, when a comparison is made between the network’s
computed output and the correct expected output, to determine the error [1]. The error can then be
used to change network parameters, which result in an improvement in performance.

Fig.4: Supervised Learning

(B) Unsupervised Learning:In this learning method, the target output is not presented to the
network [3]. It is as if there is no teacher to present the desired patterns and hence, the system
learns of its own by discovering and adapting to structural features in the input patterns [1].
(Refer figure 5).

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Fig.5: Unsupervised Learning

(C) Reinforced Learning: In this method, a teacher though available, does not present the
expected answer but only indicates if the computed output is correct or incorrect. The information
provided helps the network in its learning process [1]. A reward is given for a exact answer computed
and a penalty for a incorrect answer.

5. APPLICATIONS OF ANNs IN BUSINESS

There are various applications of ANNs in today’s business. For example financial groups are
improving their decision making by enhancing the interpretation of behavioral scoring
systems and developing superior ANN models of credit card risk and bankruptcy. Securities
and trading houses have developed and improved their forecasting techniques and trading
strategies with ANNs. Insurance companies are managing risk better by using ANNs to
develop a model of top underwriters and using this as a training and evaluation tool for other
underwriters [1]. Manufacturers are improving their product quality through predictive
process control systems using ANNs. These are summarized below:

(A) Applications in the Field of Marketing and Finance: There is a marketing application
which has been integrated with a neural network system. The Airline Marketing Tactician (a
trademark abbreviated as AMT) is a computer system made of various intelligent technologies
including expert systems [2].

ANN can be applied to many marketing decision problems, modeling and forecasting
problems [4], mainly due to the chances of use of computer intensive meth such as market
segmentation tasks, market response modeling, consumer spending patterns, new product
analysis, identification of customer characteristics, targeted marketing etc [1,4]. The essential
topics in finance are the forecasts of changes in the value of financial assets under the form of
stocks, currencies, analysis of strength of historical financial statements.

(B) Applications in the Field of Manufacturing and Production: Many factors such
asforecasting i.e. production costs, delivery dates etc., quality control and optimization dominates the
production problems [1]. As quality control problems correspond to classification thus the suitability
of the application of artificial neural networks is considered to be as good as those in the fields of
finance and marketing.

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(C) Applications in the Field Of Strategic Management and Business Policy: The main focus
is on strategic planning on firm performance and the role of strategic planning in strategic decision
making [1]. ANNs have been utilized for determining and clarifying the relationship between the two.
(D) Neural Networks for Enhancing Air Traffic Security: The passenger’s bags in
international airports have to go through an unusually rigorous inspection before being loaded. In
addition to using metal detector and X-ray station to detect metal weapons; these airports use ANNs
to screen for plastic explosives. They use a detection system which bombards the luggage with
neutrons and monitors the gamma rays that are emitted in response. The network then analyzes the
signal to decide whether the response predicts an explosive. The purpose of this operation is to detect
explosives while minimizing the number of false alarms. Detecting explosive using gamma rays is not
simple since different chemical elements release different frequencies [2]. Explosive materials are rich
in nitrogen, but so are some benign substances, including protein-rich materials, such as wool and
leather. Though an abundance of gamma rays at nitrogen’s frequency raises some suspicion [2], it is
difficult to make a distinction. To minimize the classification error, supervised training was
conducted. Using neural network reduces the cost of airport operations, increases the efficiency of the
check-in process, and improves the satisfaction of customers.

6. CONCLUSIONS AND FUTURE SCOPE

This paper presents work carried out in the field of ANNs by various researchers more
specifically applications of ANN in management. The various advantages of using the
artificial neural networks includes highly accurate results, automatically handling of variable
interactions, can easily be updated and hence are suitable for dynamic environment. It has
been observed that ANNs have associative ability i.e. once developed; an ANN is generally
robust to missing or inaccurate data. Moreover, it is a reliable tool for predicting the
determinants of relationship quality.

The computing world has a lot to gain from neural networks. Their ability to learn by
example makes them very flexible and powerful. Furthermore there is no need to devise an
algorithm in order to perform a specific task i.e. it eliminates the need to understand the
internal mechanisms of that task. They are also very well suited for real time systems because
of their fast response and computational times which are due to their parallel architecture.
Future work can be extended for finding others applications of ANNs in various fields of
Science and Engineering.

REFERENCES
[1] Ayushi Sharma and Akshit Chopra, “Artificial Neural Networks: Applications in
Management”, IOSR Journal of Business and Management (IOSR-JBM), Volume 12,
Issue 5, July -August 2013, pp. 32-40.

[2] Eldon Y. Li, “Applications Artificial Neural Networks and their Business Applications”,
Elsevier Information & Management, Volume 27, pp. 303-313, 1994.

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[3] James R. Coakley and Carol E. Brown, “Artificial Neural Networks in Accounting and
Finance: Modeling Issues”, International Journal of Intelligent Systems in Accounting,
Finance & Management, Volume 9, pp. 119–144, 2000.

[4] Kate A. Smith and Jatinder N.D. Gupta, “Neural Networks in Business: Techniques and
Applications for the Operations Researcher”, Computers & Operations Research, Volume
27, pp. 1023-1044, 2000.

[5] Koushal Kumar and Gour Sundar Mitra Thakur, “Advanced Applications of Neural
Networks and Artificial Intelligence: A Review”, International Journal of Information
Technology and Computer Science, Volume 6, pp. 57-68, 2012.

[6] Rajesh Namdev, Mahendra Singh Bhadoria and Deshdeepak Shrivastava, “Application of
Artificial Neural Network in Electrical Based Power Industry”, International Journal of
Advanced Research in Electrical, Electronics and Instrumentation Engineering, Volume
2, Issue 10, pp. 4704-4711, October 2013.

IT-167

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Internet of Things: Models & Applications

*Harpreet Kaur,** Anil Kumar, ***Preeti Verma, ****Suket Arora
*
MCA, Amritsar College of Engineering & Technology, Amritsar, [email protected]
**
MCA Student, Amritsar College of Engineering & Technology, Amritsar, [email protected]
***
Assistant Professor, Amritsar College of Engineering & Technology, Amritsar, [email protected]
****
Assistant Professor, Amritsar College of Engineering & Technology, Amritsar, [email protected]

Abstract—The Internet of Things (IoT) is an important topic in technology industry,

policy, and engineering circles and has become headline news in both the specialty press and
the popular media. It’s a concept that not only has the potential to impact how we live but
also how we work. This is the concept of basically connecting any device with an on and off
switch to the Internet or to each other. This includes everything from cellphones, coffee
makers, washing machines, headphones, lamps, wearable devices and almost anything else
you can think of.In this article, we present a survey of technologies, applications and research
challenges for Internet-of-Things.

Keywords —Internet-of-Things, Web, Smart objects, RFID (Radio Frequency

Identification), Sensors, Actuators, Interoperability, Security

Introduction
The Internet of Things (IoT) is the network of physical objects—devices, vehicles,
buildings and other items—embedded with electronics, software, sensors, and network
connectivity that enables these objects to collect and exchange data. Internet of Things
represents a general concept for the ability of network devices to sense and collect data from
the world around us, and then share that data across the internet where it can be processed
and utilized for various interesting purposes. [1] Some also use the term industrial Internet
Interchangeably with IoT. This refers to commercial applications of IoT technology in the
world of manufacturing. The internet of Things is not limited to industrial applications. [2]

Components of IoT
Most definitions of the Internet of Things include physical objects or devices (also called
“things”) that can sense and/or affect the physical environment. The IoT also includes virtual
objects, such as electronic tickets, agendas, books and wallets. The IoT also includes people-
this is particularly important in areas such as home automation, where humans can control the
environment via mobile applications. In IoT, all devices (sensors and actuators) can be
accessed via the Internet. [3] IoT also needs IoT Platforms- the type of middleware that is

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used to connect the IoT components (objects, people, services, etc.) to the IoT. All the
components in an IoT environment should be tied together by networks through various
wireless and wireline technologies, standards, and protocols to provide connectivity. [7]

Sr.No IoT Description

Components

1 Physical Things
Objects:
2 Sensors Sense the physical
environment
3 Actuators Affect the physical
environment
4 Virtual Objects Electronic tickets,
Agendas, Books,
Wallets
5 People Ex.: Humans can
control the
environment via
mobile apps
6 Services Ex.: Cloud services –
can be used to:
 Process big data
and turn it into
valuable
information
 Build and run
innovative
applications
 Optimize
business
processes by
integrating device
data [6]
7 Platforms Type of middleware
used to connect IoT
components (objects,
people, services, etc.)
to IoT. Provide

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numerous functions:
 Access to devices
 Ensuring proper
installation/behav
ior of device
 Data analytics
 Interoperable
connection to
local network,
cloud or other
devices.
8 Networks IoT components are
tied together by
networks, using
various wireless and
wireline
technologies,
standards, and
protocols to provide
connectivity. [11]

Internet of things communication models

It is useful to think about how IoT devices connect and communicate in terms of
their technical communication models. In March 2015, the Internet Architecture Board (IAB)
released a guiding architectural document for networking of smart objects which outlines a
framework of four common communication models used by IoT devices. [4] These
communication models are explained below:

 Device-to-Device Communications: The device-to-device communication model represents

two or more devices that directly connect and communicate between one another, rather than
through an intermediary application server. These devices Communicate over many types of
networks, including IP networks or the Internet. These devices use protocols like Bluetooth,
Z-Wave, or ZigBee to establish direct device-to-device communications, as shown in Figure-
1.

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Figure-1: Device to device communication

This communication model is commonly used in applications like home

automation systems, which typically use small data packets of information to
communicate between devices with relatively low data rate requirements. [8] Residential
IoT devices like light Bulbs, light switches, thermostats, and door locks normally send
small amounts of information to each other (e.g. a door lock status message or turn on
light command) in a home automation scenario.

 Device-to-Cloud Communications: In a device-to-cloud communication model, the IoT

device connects directly to an Internet cloud service like an application service provider to
exchange data and control message traffic. This approach frequently takes advantage of
existing communications mechanisms like traditional wired Ethernet or Wi-Fi connections to
establish a connection between the device and the IP network, which ultimately connects to
the cloud service. This is show in Figure-2 given below:

Figure-2: Device to cloud communication

This communication model is employed by some popular consumer IoT devices like the Nest
Labs Learning Thermostat and the Samsung SmartTV. In the case of the Nest Learning
Thermostat, the device transmits data to a cloud database where the data can be used to
analyze home energy consumption. This cloud connection enables the user to obtain remote
access to their thermostat via a Smartphone or Web interface and it also supports software
updates to the thermostat.
 Device-to-Gateway Model: In the device-to-gateway model, or the device-to-application-
layer gateway (ALG) model, the IoT device connects through an ALG service as to reach a
cloud service. In simpler terms, this means that there is application software operating on a
local gateway device, which acts as an intermediary between the device and the cloud service

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and provides security and other functionality such as data or protocol translation. Figure-3
represents this model as follows:

Figure-3: Device to gateway model

Several forms of this model are found in consumer devices. In many cases, the local
gateway device is a Smartphone running an app to communicate with a device and relay data
to a cloud service.

 Back-End Data-Sharing Model: The back-end data-sharing model refers to a communication

architecture that enables users to export and analyze smart object data from a cloud service in
combination with data from other sources. A back-end sharing architecture allows the data
collected from single IoT device data streams to be aggregated and analyzed. [10] This model
is shown in below Figure-4:

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Figure-4: Back End Data Sharing Model

applications of internet of things

The Internet of Things (IoT) allows us to use technology to enhance our comfort,
improve our energy efficiency, simplify the tasks that consume our home and work life and
give us greater control over our lives. From building and home automation to wearables, the
IoT touches every facet of our lives. [9] Based on the application domain, IoT products can
be classified broadly into five different categories: smart wearable, smart home, smart city,
smart environment, and smart enterprise. Some of them are explained below:

 Smart Wearables: Wearable technology is a blanket term that covers a vast array of devices that
monitor record and provide feedback on our environment. We can divide wearables along two
lines:
 Fitness and Environment: Fitness bands and watches and even smart clothes are able to
monitor and transmit data on our daily activity levels through step counting, heart rate and
temperature.
 Health:Wearables devices also monitor crucial health factors like oxygen saturation, heart
rate and more.
 Connected Home: A Connected Home can mean different things to different people, but it is
essentially a home with one or more devices connected together in a way that allows the

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homeowner to control, customize and monitor their environment. For example, with the right
devices we can know about when one comes in our home, or when one leaves.
 Industrial Automation and IIoT: The Internet of Things has profound implications for industrial
automation and the industrial internet of things. With wireless connectivity, advanced sensor
networks, machine-to-machine communications, traditional industrial automation will become
more informed and more efficient than ever before.
 Smart Metering: A smart meter is an internet-capable device that measures energy, water or
natural gas consumption of a building or home. With Smart Energy Metering, not only
technicians come and read your meters, you have access personally to your energy usage and
know about what impact your consumption patterns have on your wallet.

Smart Cities: With the consumption of IoT products for lighting, surveillance, centralized and
integrated system control, the cost and consumption of resources is reduced. An intrusion
detection system detects the open windows and doors and prevent from the violation from
intruders.

Except from the above applications there are various other applications such asSmart
Transport and mobility, Smart Tourism, Smart Manufacturing, Smart Energy, Smart
Environment monitoring, Smart Living, Smart Health.

challenges in internet of things

The Internet of Things offers great potential for organizations and societies. There are
still some major challenges for the Internet of Things. Some of them are:

 Variety of wired and wireless connectivity standards are required to enable different
application needs.
 Many IoT applications need to run for years over batteries and reduce the overall energy
consumption.
 Security is vital in case of IoT. Protecting user’s privacy and manufacturers’ IP; detecting and
blocking malicious activity is the big challenge in IoT.
 IoT applications are complex. Application development needs to be easy for all developers,
not just to experts.
 Cloud is important in IoT. IoT applications require end-to-end solutions including cloud
services.
 Innovative ways to sense and deliver information from the physical world to the cloud.
 IoT systems integration and testing will be a challenge with multiple platforms, numerous
protocols and large numbers of APIs.
 It’s important to immediately know when an IoT device drops off the network and goes
offline. And we also need to know when that device comes back online.
 In addition to power and CPU, bandwidth consumption is another challenge for IoT
connectivity

Conclusions
In this paper we present a short review on Internet of Things. In 2020 there is estimation
that will be 50 billion IoT devices in the market. At least all the consumers of “Java enabled”
and Embedded Linux smart objects will be in the main target group for open source solutions.

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The smart objects are processing the data collected from sensors and for instance, from RFID
tags/cards. The authentication process is an important approach taking into account NFC and
RFID domains expansion. It is hoped that a common understanding of the characteristics of
IoT will enable industry stakeholders to collaborate more effectively in order to propel the
market forward for the benefit of consumers and society.

References
[1] Wikipedia, Internet of Things, Available at: http://en.wikipedia.org/wiki/ Internet_of_Things
[2] Open Smart Cities I: Open Source Internet of Things, Available at:
http://observatorio.cenatic.es/index.php?option=com_content&view=article&id=807:open-
smart-cities-i-open-internet-of-things&catid=94:tecnologia&Itemid=137
[3] Michael Koster, Data models for the Internet of Things Available at: http://iot-
datamodels.blogspot.ro/
[4] Ion Ivan, Cristian Ciurea – Security Aspects of Collaborative Banking Systems Applied in
Economy, Journal of Mobile, Embedded and Distributed Systems, Vol. 3, No. 4, 2011, ISSN
2067–4074
[5] C. Aggarwal, N. Ashish, and A. Sheth, The Internet of Things: A Survey from The Data-Centric
Perspective, "Managing and Mining Sensor Data", Springer, 2013, ISBN 978-1-4614-6309-2.
[6] Lu Yan, Yan Zhang, Laurence T. Yang, Huansheng Ning, The Internet of Things: From RFID to
the Next-Generation Pervasive Networked Systems (Wireless Networks and Mobile
Communications), Auerbach Publications, 2008, ISBN 978-1420052817, 336 pg.
[7] W. Bajwa, J. Haupt, A. Sayeed, R. Nowak, Compressive wireless sensing, in: ACM, 2006.
[8] Adrian McEwen, Hakim Cassimally, Designing the Internet of Things, John Wiley & Sons,
2013, ISBN 978-1118430620, 260 pg.
[9] Charalampos Doukas, Building Internet of Things with the Arduino (Volume 1), CreateSpace
Independent Publishing Platform, 2012, ISBN 978-1470023430, 352 pg.
[10] Dieter Uckelmann, Mark Harrison, Florian Michahelles (Eds.), Architecting the Internet of
Things, Springer, 2011, ISBN 978-3-642-19157-2, 351 pg.
[11] Cristian Toma, Cristian Ciurea, Ion Ivan – Authentication Issues for Sensors in IoT Solutions,
Proceedings of the 6th International Conference on Security for Information Technology and
Communications (SECITC'13), June 25-26, 2013, Bucharest, Romania, ASE Printing House,
ISSN 2285-1798, ISSN-L 2285-1798.
[12] Tom Vu, The Internet of Things: Inspiration and Requirements, Available at:
http://blog.makezine.com/2013/04/18/the-internet-of-things-inspiration-and-requirements/
[13] Chad Brooks, The Internet of Things: A Seamless Network of Everyday Objects, Available at:
http://www.livescience.com/ 38562-internet-of-things.html
[14] Commission of the European Communities (18 June 2009). "Internet of Things — An action
plan for Europe" (PDF). COM(2009) 278 final.

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IT-168

Image Processing in Business Applications

*Jyoti Rani
*Assistant Professor in CSE Department
GZCCET,Bathinda
[email protected]

Abstract:Daily life of a human being is fastly changing and is heavily depending on the
changing data. This data may be in any form like tables, raw data or images. Imaging is one
of the most common and versatile way of obtaining information from the objects. The images
may include the Satellite images, camera images, Medical images, building and structure
images etc.Since the manual analysis of the large data is too complicated as compared to
image analysis..In this paper different images and their role in business scenario is discussed.

Key words: Medical imaging, Query image, Satellite images.

1.1Medical imaging
Medical imaging refers to the techniques and processes used to create images of the human
body or parts thereof for clinical purposes such as medical procedures seeking to reveal,
diagnose or examine disease or medical science [1].It is a part of biological imaging and
incorporates radiology. Medical imaging is often perceived to designate the set of techniques
that produce images of the internal aspect of the body. Medical Imaging includes the use of
radiographs, computed tomography (CT), magnetic resonance imaging (MRI), ultrasound,
and other techniques by which physicians evaluate an area of the human body that is not
normally visible. Medical imaging has the invaluable potential to greatly extend the reach of
medical research beyond detecting the anatomical presence of the disease. By employing
applied engineering technologies, more intensive study of diseases at the cellular level is
possible. In turn, this greater understanding of the physiology of an illness will lead to more

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targeted treatments which will aid in medical business analysis.Treatments can be done fastly
and in a comparative manner which helps the medical business in every aspect.

1.2 Sattelite Image

Of all the various data sources used in GIS, one of the most important is undoubtedly that
provided by remote sensing through the use of satellites, we now have a continuing program
of data acquisition for the entire world with time framesranging from a couple of weeks to a
matter of hours. Very importantly, we also now have access to remotely sensed images in
digital form, allowing rapid integration of the results of remote sensing analysis into a GIS.

The development of digital techniques for the restoration, enhancement and computer-
assisted interpretation of remotelysensed images initially proceeded independently and
somewhat ahead of GIS. However, the raster data structure andmany of the procedures
involved in these Image Processing Systems (IPS) were identical to those involved in raster
GIS. As aresult, it has become common to see IPS software packages add general capabilities
for GIS, and GIS software systems.

IDRISI is a combined GIS and image processing system that offers advanced capabilities in
both areas. Because of the extreme importance of remote sensing as a data input to GIS, it has
become necessary for GIS analysts (particularly those involved in natural resource
applications) to gain a strong familiarity with IPS.

The satellite images contain images obtained from satellites. Satellite imagery consists
of images of earth or other planets collected by satellites. Imaging satellites are operated by
governments and businesses around the world. Satellite imaging companies sell images under
license. Images are licensed to governments and businesses.

All satellite images produced by NASA are published by NASA earth Observation and are
freely available to the public. Several other countries have satellite imaging program.

There are also private companies that provide commercial satellite imagery. In the early 21st
century satellite imagery became widely available when affordable, easy to use software with
access to satellite imagery databases was offered by several companies and organizations.

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Satellite images have many applications

in metrology,oceanography,fishing,agriculture,biodiversity,conservation,forestry,landscape,g
eology,cartography,regionalplanning ,education, intelligence and warfare. Images can be in
visible colors and in other spectra.. There are also elevation maps, usually made by radar
images. Interpretation and analysis of satellite imagery is conducted using specialized remote
sensing applications.

Remote sensing can be defined as any process whereby information is gathered about an
object, area or phenomenon without being in contact with it. Our eyes are an excellent
example of a remote sensing device. We are able to gather information about our
surroundings by gauging the amount and nature of the reflectance of visible light energy from
some external source (such as the sun or a light bulb) as it reflects off objects in our field of
view. Contrast this with athermometer, which must be in contact with the phenomenon it
measures, and thus is not a remote sensing device.

1.3 Building and structure images

Images of various buildings by taking into consideration the various perspectives helps in
understanding the organization view of the company as well as business organization
.Pictorial representation of the same will yields a quick response rather having the manual
information.

Corporate image, describes the manner in which a company, its activities, and its products or
services are perceived by outsiders. In a competitive business climate, many businesses
actively work to create and communicate a positive image to their customers, shareholders,
the financial community, and the general public.
Several factors have contributed to the increasing importance of corporate image in recent
years. For example, the business climate in the United States has become one of
environmental complexity and change. This has forced many business enterprises to
significantly alter their strategies to better compete and survive.

A related factor is that as a corporation expands its operations internationally, or even

domestically, through acquisitions, there is a danger that its geographically dispersed

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business units will project dissimilar or contrary images to the detriment of corporate
synergy.

A final factor stimulating the current interest in corporate image is society's growing
expectation that corporations be socially responsible. Many of today's consumers consider the
environmental and social image of firms in making their purchasing decisions.

Aerial imaging is one of the most common and versatile way of obtaining information from
the objects on the Earth surface. The information obtained can be quite various and high-
quality due to the advanced capabilities of aerial imaging such as the availability of ultra high
resolution cameras (film & digital), geometric fidelity involved, broadened spectral
sensitivity, permanent recording etc. These special characteristics turned out the aerial
imaging one of the most important data input techniques to be used for the object extraction
task. Object extraction process from aerial images is generally interested with objects that are
most related with applications such as mapping, site selection and management, military etc

1.4 Conclusion

Importance and necessity of digital image processing stems from two principal application
areas: the first being the Improvement of pictorial information for human interpretation and
the second being the Processing of a scene data for an autonomous machine perception which
will aid in the business scenarios. Digital image processing has a broad range of applications
such as remote sensing, image and data storage for transmission in business applications,
medical imaging, acoustic imaging, Forensic sciences and industrial automation. Images
acquired by satellites are useful in tracking of earth resources, geographical mapping, and
prediction of agricultural crops, urban population, weather forecasting, flood and fire control.
Space imaging applications include recognition and analyzation of objects contained in
images obtained from deep space-probe missions. There are also medical applications such as
processing of X-Rays, Ultrasonic scanning, Electron micrographs, Magnetic Resonance
Imaging, Nuclear Magnetic Resonance Imaging, etc.

In addition to the above mentioned applications, digital image processing is now being used
to solve a wide variety of problems. Though unrelated, these problems commonly require

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methods capable of enhancing information for humanvisual interpretation and analysis. The
Image processing Procedures such as Image enhancement and restoration are used to process
degraded or blurred images. Successful applications of image processing concepts are found
in astronomy, defense, biology, medical and industrial applications. As per Medical Imaging
is concerned most of the images may be used in the detection of tumors or for screening the
patients. The current major area of application of digital image processing (DIP) techniques is
in solving the problem of machine vision so as to

attain good results.

Acknowledgment

The author wishes to thank her family for their contribution and their support

REFERENCES

[1] A.k.Jain “Fundamentals of Digital Image Processing”, Prentice-Hall, pp 384, 1986.

[2] D. Vernon, “Machine Vision”, Prentice-Hall, pp 63 - 66, 76 - 78, 1991.

[3]R. Gonzalez and R. Woods, “Digital image processing”, Addison-Wesley Publishing

Company, 3rd edition pp 549. 1992.

[4] N. R. Pal and S. K. Pal, “A Review on Image Segmentation Techniques,” International

journal pattern recognition. vol 26, pp. 1277–1294, 1993.

[5] Hemant D. Tagare, Carl Jaffe and James Duncan, “A Content Based Retrieval Approach”,
Journal of American medical informatics, pp184-198, 1997

[6] Yong Rui,Thomas S.Huang and shih Fu Chang, “Image Retrieval Current
Techniques,Promising Directions and Open Issues”, vol 10, issue 1, pp 39-62,1999.

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IT-169

Cloud Computing Security& Integrity: A Review

*Niti Syal, ** Rahul Garg, *** Urvashi Syal

*
Senior Content Writer (Smarttech-Technologies) Mohali, India
**
A.Prof (Computer Applications Dept.), GZSCCET, Bathinda India
***
Content Writer (Smarttech-Technologies) Mohali, India

Keywords: Cloud Computing, Security, Service Models, Cloud Storage, energy Efficiency.

Abstract.Cloud computing is today’s hot topic for research. In recent time, it is the
technology that is providing services to its users over internet. As cloud computing allows
sharing and storing large amount of data over internet, so security has become important
topic. There are enormous users, so also security has become very important. This survey
paper discuss the security issues of cloud storage in cloud computing.

1. Introduction
1.1. Cloud Computing

Cloud computing is the types of model that provides the services over the internet using
hardware and software for the provision of services. Cloud computing is very important
model for utilization of applications over internet. Cloud applications use the data centers for
the provision of services.

Cloud computing has been accepted universally over the internet. Lot of work has been done
to give the proper definition of cloud computing. But yet proper definition of cloud
computing has not been achieved.

But there is a definition that has been given by the National Institute of Standards and
Technology (NIST):

“Cloud computing is a model that provide access to various resources over the internet
having minimal effort required for provision of applications.

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1.2 Individualities of Cloud Computing

 On-demand self-service: Without requirement of human service, interaction between

various servers to provide applications has been done automatically.
 Broad network access: Services can be utilized via heterogeneous platforms over
large area using mobile phones, tablets etc.
 Resource pooling: Different physical machines and Virtual machines has been used
for solving the problem of load balancing as well as energy efficiency and resource
allocation.
 Rapid elasticity: At any time services can be provided to the client on demand.

 Measured service: Cloud systems automatically allocates the resources to the

systems that are idle in their nature to distribute the work and to enhance the accuracy
of the system.

1.3 Service Models of Cloud Computing

 Software as a Service (SaaS): It is the software distribution model in which services

are available to large users over internet.In today’s era, Saas is becoming very popular
because of the adoption of SOA model and web services. There are numerous benefits
of Saas i.e. easy administration, automatic updates, easy collaboration and universal
accessibility.
 Platform as a Service (PaaS): The capability provided to the consumer is to deploy
onto the cloud infrastructure consumer-created or acquired applications created using
programming languages, libraries, services, and tools supported by the provider. The
consumer does not manage or control the underlying cloud infrastructure including
network, servers, operating systems, or storage, but has control over the deployed
applications and possibly configuration settings for the application-hosting
environment.
 Infrastructure as a Service (IaaS): The capability offered to the customer is to
provision storage, networks, processing, along with additional fundamental
computing resources where the customer is capable to install and run arbitrary

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software that could comprise operating-systems & applications. The customer does
not cope-up or control the basic cloud-infrastructure but has complete control over
various storage, operating systems, and deployed applications; and probably restricted
control of selective networking components (e.g., host firewalls).
2. Importance of Security In Cloud Computing
Below we have given statistical resulted graph which demonstrates the outcomes of the
survey that was directed by the International Data Corporation (IDC) in August, 2008
between IT professionals as well as senior business executives concerning the
issues/problems that mainly impact the global performance of Cloud computing. And the
results of survey display security at the topmost of the list that proclaims its significance as
compared to additional parameters of Cloud Computing. During a key-note speech to the
Brookings Institution policy forum, “Cloud Computing for Business and Society”, Microsoft
General Counsel Brad Smith also emphasized data from a survey commissioned via
Microsoft for assessing attitudes on Cloud_Computing between several business leaders and
the over-all population in January 2010. T

Fig. 1 Energy Efficiency in Cloud Computing [8]

The survey establish that while fifty eight percentage of the general population along with
eighty six percentage of the senior business leaders are quite excited about the potential of
Cloud Computing and more than ninety percentage of these similar people are very much
concerned regarding the access, security, as well as privacy of their own data in the specific

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Cloud. (Source:http://www.microsoft.com/presspass/press/2010/jan10/1-
20BrookingsPR.mspx). The survey outcomes also presents that the security is one of the
foremost challenge in the midst of all the parameters, which will have great impact on the
growth and performance of cloud computing [8].
2.1 Security Issues in Cloud

Although, the virtualization as well as Cloud Computing provides wide variety of active
resources, the security-concern is commonly observed as the enormous problem in the Cloud
that makes the clients to repel themselves in accepting the technology of Cloud Computing
[9, 10]. Some of these security problems/ challenges in the Cloud are deliberated underneath:

 Integrity: Integrity makes sure that data apprehended in a system is an appropriate illustration
of the data proposed and that it has not been amended by an approved person. When any
specific application is running on a cloud server, backup routine is configured such that in the
occurrence of a data-loss instance the data will be safe. Customarily, the data would probably
be backed up to any specific portable media gadget on a systematic interval basis that will
then be kept in an off-site place [11].
 Availability: Availability certifies that data-processing resources are not made inaccessible as
a result of some malicious action. It is a quite simple notion, in which when a customer
attempts to access something, it is obtainable to be retrieved. This is important for mission
critical frameworks. Availability for these specific frameworks is quite critical that several
enterprises have business stability plans appropriate for their specific systems to have some
redundancy [12, 13].
 Confidentiality: Confidentiality make sure that data is not revealed to any illicit peoples.
Confidentiality loss usually occurs when data could be viewed or read easily by any
individuals by those who are unapproved to access that data. Loss of confidentiality might
take place physically or else electronically. Physical loss of confidential information generally
takes place through social engineering. Electronic confidentiality loss of data takes place
when the customers as well as cloud servers aren’t encoding their communications.
3. Conclusion & Future Scope

Cloud computing is modern technology, which is being extensively utilized all-over the
world. As soon as the organization takes the decision to move to the cloud, it loses control
above the data. Therefore, the amount of protection required to secure information which is
directly proportionate to the actual value of the data. Security of the Cloud depends upon

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trustworthy computing as well as cryptography. Various cloud platforms are existing

nowadays are in educational along with in enterprises circle

In this paper, we have deliberated the problems which are mainly associated to availability,
location of data, security, storage, along with integrity. Establishing trust is an approach to
overcome these security problems as it forms entities relationship quite safely and quickly.
These problems are stated above would possibly be the research hotspot of the cloud
computing. There is no doubt that cloud computing has cheerful future.

References

[1]. Boldreva A., Chenette N., Lee Y, O’neill A., “Order-preserving Symmetric encryption”,
Advances in Cryptology-EUROCRYPT 2009 Springer, Berlin/Heidelberg, (2009) 224-241.

[2]. Boneh D., Di G., Ostrovsky R., Persiano G., “Public key encryption with keyword
search”, Advances in Cryptology-Eurocrypt, Springer, Berlin/Heidelberg, (2004) 506–522.

[3]. B.R kandukuri, R.Paturi V, and A.Rakshit, “cloud security issues”,2009 IEEE
International Conference on Services Computing, Bangalore, India, (2009) 517-520.

[4]. Campbell, Jeronimo, “Applied Virtualization Technology,” Hillsboro, Intel Press (ISBN
09764832-3- 8), (2006) 69-73.

[5]. Chandrahasan, R. Kalaichelvi, S. Shanmuga Priya, and L. Arockiam, “Research

Challenges and Security Issues in Cloud Computing”, International Journal of Computational
Intelligence and Information Security, 3 (2012) 42-48.

[6]. Chun-Ting Huang, Zhongyuan Qin, C.-C. Jay Kuo., “Multimedia Storage Security in
Cloud Computing: an Overview”,IEEE, (2011).

[7]. Cloud Security Alliance, “Top Threats to Cloud Computing v1.0,” Prepared by the Cloud
Security Alliance, (2010) 1-14.

[8] Chang, L, Ti ; Chin L; Chang, A.Y.; Chun J, C, “ Information security issue of enterprises
adopting the application of cloud computing”, IEEE 2010 Sixth International Conference on
Networked Computing and Advanced Information Management (NCM), 645 (2010) 16-18.

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[9]. Dong Xin, et al.”achieving secure and efficient data collaboration in cloud computing.
”Quality of service, 2013 IEEE/ACM 21st International symposium, IEEE, (2013).

[10]. Feng-Tse Lin, Teng-San Shih, “Cloud Computing: The Emerging Computing
Technology,” ICIC Express Letters Part B: Applications, 1 (2010) 33-38.

[11]. Foster, I. T., Zhao, Y., Raicu, I., & Lu, S, “Cloud Computing and Grid Computing 360-
Degree Compared CoRR”, (2009).

[12]. G. Hughes, D. Al-Jumeily & A. Hussain, “Supporting Cloud Computing Management

through an Object Mapping Declarative Language”, Developments in E-systems engineering,
(2010).

[13]. Kant, Dr Chander, and Yogesh Sharma, “Enhanced Security Architecture for Cloud
Data Security”, International Journal of Advanced Research in Computer Science and
Software Engineering, 3 (2013) 571-575.

IT-170
Role of Cloud Computing in Business and IT Sector
*Gagandeep Kaur ** Geetu
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*Assistant Professor Department of Computer Science, Punjabi University Patiala

Guru Nanak College Budhlada, Mansa(Punjab)

Email Id: [email protected]

Contact no:9781493961

**Assistant Professor Department of Computer Science, Punjabi University Patiala

Guru Nanak College Budhlada, Mansa(Punjab)

Email Id:[email protected]

ABSTRACT

cloud computing is a new general purpose internet-based technology through which

information is stored in servers and provided as a service as on-demand to clients. In this
paper we will describe the reasons that why people switch from traditional IT to the cloud
and effect of cloud computing on business. The paper defines clouds, explains the business
benefits of cloud computing, and outlines cloud architecture and its services. For business
purpose cloud is widely used in organizations. Security factor was main issue in cloud, but
with the facility of digital signature it becomes easy to share information between
organizations. Business firms can keep secure their data while exchanging information. In
particular, we argue that with continued research advances in trusted computing and
computation-supporting encryption, life in the cloud can be advantageous from a business.

KEYWORDS: Cloud, Computing, Information, security.

1. INTRODUCTION:

Cloud computing Definition:A large-scale distributed computing paradigm that is driven by

economies of scale, in which a pool of abstracted, virtualized, dynamically-scalable, managed
computing power, storage, platforms, and services are delivered on demand to external
customers over the Internet. Cloud computing to put it simply means Internet Computing.
With Cloud Computing users can access database resources via the Internet from anywhere,
for as long as they need, without worrying about any maintenance or management of actual
resources. Besides, databases in cloud are very dynamic and scalable. Cloud computing
provides the facility to access shared resources and common infrastructure, offering services
on demand over the network to perform operations that meet changing business needs. The
location of physical resources and devices being accessed are typically not known to the end
user. Cloud computing services has huge opportunity in Indian market due to the large

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number of Small and Medium businesses (SMBs) which is at around 35 million and they
want easy to use , reliable and scalable application that helps them to grow and expand their
business. It has the potential to change the way IT hardware is purchased, designed and used.
With its promise of infinite scalability and a pay-as-you-go pricing model, the primary benefit
that cloud services extends to the large enterprise is greater business effectiveness at lower IT
costs. Cloud creates a revolution in the enhancement of business prospective. For the small
and medium business (SMB) segment, cloud services lower barriers to market growth by
lowering technology costs and upfront investments and Cloud computing brings utility
computing closer to reality.
On the other side, improving high-speed connectivity, an emerging segment investing in
ITinfrastructure and increasing enterprise data centre expenditure are drivers that are expected
tocontribute to a growing cloud market. From the supply perspective, a maturing traditional
IT market and an extremely competitive third-party data centre market are likely to be
primary drivers of cloud services.

1.1 CLOUD SERVICES

●Software as a Service (SaaS) cloud model—Enables software to be delivered from a host

source over a network as opposed to installations or implementations

Figure 1 Cloud Services in detail

●Platform as a Service (PaaS) cloud model—Enables operating systems and middleware

services to be delivered from a man-aged source over a network

●Infrastructure as a Service (IaaS) cloud model—Enables the entire infrastructure to be

delivered as a service over a net-work, including storage, routers, virtual systems, hardware
and servers. Detail of cloud services is given in Figure above.

1.2 CLOUD ARCHITECTURE

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There are also multiple versions of definition for Cloud architecture, we define A four-layer
architecture for Cloud Computing in comparison to the Grid architecture, composed of 1)
fabric, 2) unified resource, 3) platform, and 4) application Layers. The fabric layer contains
the raw hardware level resources such as computer resources, storage resources, and network
resources. The unified resource layer contains resources that have been
abstracted/encapsulated (usually by virtualization) so that they can be exposed to upper layer
and end users as integrated resources, for instance, a virtual computer/cluster, a logical file
system, a database system, etc. The platform layer adds on a collection of specialized tools,
middleware and services on top of the unified resources to provide a development and/or
deployment platform. Finally, the application layer contains the applications that would run
in the Clouds.

Figure2. Layers of cloud computing

1.3CLOUD BUSINESS MODEL

Traditional business model for software has been a one-time payment for unlimited use
(usually on 1 computer) of the software. In a cloud-based business model, a customer will
pay the provider on a consumption basis, very much like the utility companies charge for
basic utilities such as electricity, gas, and water, and the model relies on economies of scale
in order to drive prices down for users and profits up for providers. Today, Amazon
essentially provides a centralized Cloud consisting of Compute Cloud EC2 and Data Cloud
S3. The former is charged based on per instance-hour consumed for each instance type and
the later is charged by per GB-Month of storage used. Now it is very easy for users to do that
tasks which are not possible due to lack of resources, storage, software etc. Now they can Use
all services and software from cloud providers but it increase cost. In addition, data transfer is
charged by TB / month data transfer, depending on the source and target of such transfer. The
prospect of needing only a credit card to get on-demand access to 100,000+ processors in tens
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of data centers distributed throughout the world—resources that be applied to problems with
massive, potentially distributed data, is exciting! The business model for Grids (at least that
found in academia or government labs) is project-oriented in which the users or community
represented by that proposal have certain number of service units (i.e. CPU hours) they can
spend. For example, the Tera Grid operates in this fashion, and requires increasingly complex
proposals be written for increasing number of computational power. The TeraGrid has more
than a dozen Grid sites, all hosted at various institutions around the country. What makes an
institution want to join the TeraGrid? When an institution joins the TeraGrid with a set of
resources, it knows that others in the community can now use these resources across the
country. It also acknowledges the fact that it gains access to a dozen other Grid sites[2]. This
same model has worked rather well for many Grids around the globe, giving institutions
incentives to join various Grids for access to additional resources for all the users from the
corresponding institution. There are also endeavors to build a Grid economy for a global Grid
infrastructure that supports the trading, negotiation, provisioning, and allocation of resources
based on the levels of services provided, risk and cost, and users’ preferences; so far, resource
exchange[1] (e.g. trade storage for compute cycles), auctions, game theory based resource
coordination, virtual currencies, resource brokers and intermediaries, and various other
economic models have been proposed and applied in practice.

1.4 TYPES OF CLOUD COMPUTING ENVIRONMENTS

 PUBLIC CLOUDS:-The cloud infrastructure is available to the public on a commercial basis

by a cloud service provider. This enables a consumer to develop and deploy a service in the
cloud with very little financial outlay compared to the capital expenditure requirements
normally associated with other deployment options.[4] This environment can be used by the
general public. This includes individuals, corporations and other types of organizations[5].
Typically, public clouds are administrated by third parties or vendors over the Internet, and
services are offered on pay-per-use basis. These are also called provider clouds.
 PRIVATE CLOUDS:- The cloud infrastructure has been deployed, and is maintained and
operated for a specific organization. The operation may be in-house or with a third party on
the premises. This cloud computing environment resides within the boundaries of an
organization and is used exclusively for the organizations benefits. These are also called
internal clouds. They are built primarily by IT departments within enterprises who seek to
optimize utilization of infrastructure resources within the enterprise by provisioning the
infrastructure with applications using the concepts of grid and virtualization[5].
 HYBRID CLOUDS: This is a combination of both private (internal) and public (external)
cloud computing environments. The cloud infrastructure consists of a number of clouds of
any type, but the clouds have the ability through their interfaces to allow data and/or
applications to be moved from one cloud to another. This can be a combination of private and
public clouds
 COMMUNITY CLOUD: The cloud infrastructure is shared among a number of organizations
with similar interests and requirements. This may help limit the capital expenditure costs for

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its establishment as the costs are shared among the organizations. The operation may be in-
house or with a third party on the premises.
.

1.5 CHALLENGES OF CLOUD COMPUTING IN BUSINESS ENVIRONMENT

Data Security is a crucial element that warrants scrutiny. Enterprises are reluctant to buy an
assurance of business data security from vendors. They fear losing data to competition and
the data confidentiality of consumers. In many instances, the actual storage location is not
disclosed, adding onto the security concerns of enterprises. In the existing models, firewalls
across data centers protect this sensitive information. In the cloud model, Service providers
are responsible for maintaining data security and enterprises would have to rely on
them[6][7].

(a) SECURITY AND PRIVACY:-Perhaps two of the more “hot button” issues surrounding
cloud computing relate to storing and securing data, and monitoring the use of the cloud by
the service providers. These issues are generally attributed to slowing the deployment of
cloud services. These challenges can be addressed, for example, by storing the information
internal to the organization, but allowing it to be used in the cloud. For this to occur, though,
the security mechanisms between organization and the cloud need to be robust and a Hybrid
cloud could support such a deployment [9]. Many organizations are uncomfortable with
storing their data and applications on systems they do not control. Migrating workloads to a
shared infrastructure increases the potential for unauthorized exposure. Consistency around
authentication, identity management, compliance, and access technologies will become
increasingly important [8]. To reassure their customers, cloud providers must offer a high
degree of transparency into their operations.
(b) DATA AND APPLICATION INTEROPERABILITY:-It is important that both data and
applications systems expose standard interfaces. Organizations will want the flexibility to
create new solutions enabled by data and applications that interoperate with each other
regardless of where they reside (public clouds, private clouds that reside within an
organization firewall, traditional IT environments or some combination)[14].
(c) MANAGEMENT CAPABILITIES:-Despite there being multiple cloud providers, the
management of platform and infrastructure is still in its infancy. Features like „ Auto
scaling‟ for example, are a crucial requirement for many enterprises. There is huge potential
to improve on the scalability and load balancing features provided today [10].
(d) DATA AND APPLICATION PORTABILITY:-Without standards, the ability to bring
systems back in-house or choose another cloud provider will be limited by proprietary
interfaces [14]. Once an organization builds or ports a system to use a cloud provider offers,
that system back in-house will be difficult and expensive.
(e) METERING AND MONITORING:-Business leaders will want to use multiple cloud
providers in their IT solutions and will need to monitor system performance across these
solutions. Providers must supply consistent formats to monitor cloud applications and service
performance and make them compatible with existing monitoring systems. It is clear that the
opportunity for those who effectively utilize cloud computing in their organizations is great.
However, these opportunities are not without risks and barriers [12]. It is our belief that the
value of cloud computing can be fully realized only when cloud providers ensures [14].
(f) REGULATORY AND COMPLIANCE RESTRICTIONS:-In some of the European
countries, Government regulations do not allow customer's personal information and other
sensitive information to be physically located outside the state or country. In order to meet
such requirements, cloud providers need to setup a data center or a storage site exclusively

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within the country to comply with regulations. Having such an infrastructure may not always
be feasible and is a big challenge for cloud providers. With cloud computing, the action
moves to the interface that is, to the interface between service suppliers and multiple groups
of service consumers. Cloud services will demand expertise in distributed services,
procurement, risk assessment and service negotiation areas that many enterprises are only
modestly equipped to handle.

2. LITERATURE SURVEY

After becoming IT growth there is enhance increase in business growth. India is growing at
faster pace in information technology sector thereby showing a great potential for the cloud
computing services. According to Springboard Research report (Jan 2009) SAAS India i.e.
software as a service in India will register a compounded annual growth rate of 76%in the
time period of 2007-2011. Cloud computing services has huge opportunity in Indian market
due to the large number of Small and Medium businesses (SMBs) which is at around 35
million and they want easy to use , reliable and scalable application that helps them to grow
and expand their business. Business becomes on the peek, people can share information with
one another and outside the world. Cloud computing provides a secure data algorithms so
there are less chance for getting access of data by intruders. People can use any service, any
resource and space from cloud providers by paying them some cost. Now we can see the
growth of business at peak level using IT Sector.

It has the potential to change the way IT hardware is purchased, designed and used. With its
promise of infinite scalability and a pay-as-you-go pricing model, the primary benefit that
cloud services extends to the large enterprise is greater business effectiveness at lower IT
costs. For the small and medium business (SMB) segment, cloud services lower barriers to
market growth by lowering technology costs and upfront investments and Cloud computing
brings utility computing closer to reality.

On the other side, improving high-speed connectivity, an emerging segment investing in IT

infrastructure and increasing enterprise data centre expenditure are drivers that are expected to
contribute to a growing cloud market . From the supply perspective, a maturing traditional IT
market and an extremely competitive third-party data centre market are likely to be primary
drivers of cloud services.

3. OBJECTIVES
 In this we will study about the reasons for switching traditional IT to cloud computing.
 To study about the cloud computing and their business prospective view.
 To know services and characteristics of the cloud computing.
 Challenges of cloud computing.

4. Methodology

Due to the relatively new nature of Cloud computing in the domain of Business Intelligence, a
qualitative design with an exploratory character was used for this research. The ambition of
this work is to examine the impacts of Cloud computing on Service based BI architectures as

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figure 3 outlines. The study therefore tries to identify and analyze influencing factors and
interdependencies in this context.

Figure3. Business Flow chart using cloud computing

In the beginning, a comprehensive literature review was conducted to get an overview of

relevant topics and current research subjects. This Flow chart shows the business view using
cloud computing. It solves the business problems, provide solutions, give latest ideas and
provide services to the user to do business with security.

The gathered information and an additional analysis of the existing BI infrastructure in the
cooperating company were used to structure challenges and consequences of Cloud based
Business Intelligence. Since it turned out that the interdependencies of systems and services
play an essential role in the Cloud BI context, a further in-depth interview was conducted and
multiple real life scenarios were developed to examine the related issues and it enhance
business prospective more precisely.

CONCLUSION

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The main objective of this paper was to analyze the scope of cloud computing in business
environment. Before hundred years it was a big problem to share of information with
security. But cloud computing override the limitation of 3rd party intruders to hack the
important information.These issues lead to a call to action for the IT industry around a vision
of an open cloud. Cloud computing provide some secure services in business to the users.
We as industry participants must work together to ensure that the cloud remains as open as all
other IT technologies. Anyone can Purchase hundred of resources, Memory Space,
Hardware, Software, Services from cloud providers, Cloud computing today is the beginning
of “network based computing” over Internet in force. For this purpose Cloud provides end-
user access to application, services opens up a wealth of opportunities for users with special
needs. It enhances the growth of business using computers. Now it is easy for the business
intelligent persons to share their smart ideas and information with other users, which is
helpful for enhance the business needs.

REFERENCES

1. B. Michael. “In Clouds Shall We Trust,” IEEE Security & Privacy, vol. 7, no. 5, p. 3,
September/October 2009.
2. C. H. Constantinos Evangelinos, “Cloud Computing for parallel Scientific HPC Applications:
Feasibility of Running Coupled Atmosphere-Ocean Climate Models on Amazon‟ s EC2,”
The First Workshop on Cloud Computing and its Applications (CCA‟ 08), October 2008.
3. G. Sanjay, G. Howard, and L. Shun-Tak. The google file system. In Proceedings of the 17th
ACM Symposium on Operating Systems Principles, pages 29–43, 2003.
4. H. G. Miller and J. Veiga. “Cloud Computing: Will Commodity Services Benefit Users Long
Term? IEEE ITPro, vol. 11, no. 6, p. 67-69, November/December 2009.
5. J. Brodkin. “Gartner: Seven cloud-computing security risks”,
http://www.networkworld.com/news/2008/070208-cloud.html, 2008.
6. L. Tucker, “Introduction to Cloud Computing. for Enterprise Users” Cloud Computing Sun
Microsystems, Inc.
7. Mouline, Imad. “Why Assumptions About Cloud Performance Can Be Dangerous.” Cloud
Computing Journal. May, 2009.
8. Muys, A. (2006). Building an Enterprise-Scale Database for RDF Data.
9. Nolle, Tom. “Meeting performance standards and SLAs in the cloud.”Search Cloud
Computing. April, 2010.
10. Raj Kumar Buyyaa, Chee Shin Yeoa, , Srikumar Venugopala, James Broberga, and Ivona
Brandicc, “Cloud computing and emerging IT platforms: Vision, hype, and reality for
delivering computing as the 5th utility”, Future Generation Computer Systems, Volume 25,
Issue 6, June 2009, Pages 599-616.
11. RaoMikkilineni, Vijay Sarathy "Cloud Computing and Lessons from the Past", Proceedings
of IEEE WETICE 2009, First International.
12. S. Bandyopadhyay, S. R. Marston, Z. Li, A.Ghalsasi, “Cloud Computing: The Business
Perspective”, November 2009.
13. Steve Hanna, A security analysis of Cloud Computing. Cloud Computing Journal.

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14. Mr. Gurmeet Singh, Mr. Vineet Kumar Sachdeva “Impact And Challenges Of Cloud
Computing In Current Scenario” International Journal Of Social Science & Interdisciplinary
Research Vol.1 Issue 10, October

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An Overview of Vehicular Ad-Hoc Networks (VANETs)
Ms. Karamjot Kaur
Department of Computer Applications
GZSCCET
Bathinda, Punjab, India
[email protected]
Ms. Manpreet Kaur Maan

Assitant Professor, GGSCW, Chandigarh

Abstract:

Vehicular specially appointed systems (VANETs) innovation has developed as a vital

exploration range throughout the most recent couple of years. Being specially appointed in
nature, VANET is a kind of systems that is made from the idea of setting up a system of autos
for a particular need or circumstance. VANET has ended up dynamic zone of research,
institutionalization, and advancement since it can possibly enhance vehicle and street wellbeing,
activity effectiveness, and accommodation and also solace to both drivers and travelers. Late
Research endeavors have set a solid accentuation on novel VANET outline designs and
executions. We exhibit a survey of remote access measures for VANETs, and depict a portion of
the late VANET trials and arrangements in the US, Japan, and the European Union. What's more,
we likewise quickly display a percentage of the test systems as of now accessible to VANET
analysts for VANET recreations and we survey their advantages and confinements.

Keywords- VANET, Modeling, Mobility, Routing, Security

Introduction:-

Giani Zail Singh Campus College of Engg. & Technology

(Maharaja Ranjit Singh State Technical University Bathinda)
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Correspondence abilities in vehicles are the premise of an imagined In VANET or astute

transportation frameworks(ITS)[1]. Vehicles are empowered to convey among themselves
(vehicle-to-vehicle, V2V) and by means of roadside access focuses (vehicle-to-roadside,
V2R) likewise called as Road Side Units (RSUs)[2]. Vehicular correspondence is relied upon
to add to more secure and more proficient streets by giving auspicious data to drivers,
furthermore to make travel more advantageous. The combination of V2V and V2R
correspondence is gainful on the grounds that V2R gives better administration inadequate
systems and long separation correspondence, though V2V empowers direct correspondence
for little to medium separations/territories and at areas where roadside access focuses are not
accessible. Giving vehicle–vehicle and vehicle–roadside correspondence can impressively
enhance movement wellbeing and solace of driving and voyaging. For correspondence in
vehicular specially appointed systems, position-based steering has developed as a promising
competitor. For Internet access, Mobile IPv6 is a generally acknowledged answer for give
session progression and reachability to the Internet for versatile hubs. While coordinated
answers for utilization of Mobile IPv6 in (non-vehicular) portable specially appointed
systems exist, an answer has been suggested that, based upon a Mobile IPv6 intermediary
based design, chooses the ideal correspondence mode (direct in-vehicle, vehicle–vehicle, and
vehicle–roadside correspondence) and gives dynamic exchanging in the middle of vehicle–
vehicle and vehicle–roadside correspondence mode amid a correspondence session in the
event that that more than one correspondence mode is at the same time accessible[3][4].

Presently there is continuous exploration in the field of InVANETs for a few situations. The
fundamental hobby is in applications for activity situations, cell telephone frameworks,
sensor systems and future battle frameworks. Late research has concentrated on topology
related issues, for example, range advancement, steering components, or location
frameworks, and in addition security issues like traceability or encryption. Furthermore, there
are certain examination hobbies, for example, the impacts of directional reception
apparatuses for InVANETs and insignificant force utilization for sensor systems. The greater
part of this examination points either at a general way to deal with remote systems in an
expansive setting or concentrate on a to a great degree particular issue’[5].Vehicle
Computing is a champion amongst the most creating asks about and expansive investigation
is going on spotlight on particular issues of their field.

1. Overview of VANET

Intelligent Transportation Systems (ITSs):-

In intelligent transportation frameworks, every vehicle tackles the part of sender, collector,
and switch to show data to the vehicular system or transportation organization, which then
uses the data to guarantee protected, free-stream of activity. Despite the fact that it is
protected to expect that foundation exists to some degree and vehicles have admittance to it
discontinuously, it is farfetched to require that vehicles dependably have remote access to
roadside units. Between vehicle, vehicle-to-roadside, and directing construct interchanges
depend with respect to extremely precise and progressive data about the encompassing
environment, which, thusly, requires the utilization of exact situating frameworks and keen
correspondence conventions for trading data[6].

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Design and segments of VANETs

For correspondence, vehicles might contain a few units which can be utilized to set up the
association with different vehicles or to the base. Ordinarily, taking after are the three
generally essential segments of VANET engineering: Application Units (AUs), On Board
Units (OBUs) and RSUs. RSUs might act simply like a switch, which gives administrations
to the moving customers [6] while OBUs furthermore, AUs are the buyer for those
administrations. The correspondence among OBUs and AUs with RSUs should be possible
utilizing remote models for example, IEEE 802.11p. The vehicles by and large have OBUs
introduced on leading body of the vehicles, which can be utilized for giving correspondence
among different OBUs or with RSUs. Besides, OBUs likewise give correspondence with
AUs. OBUs are utilized for blockage control, IP versatility

administration,information accumulation and preparing [6]. AUs are the modern gadgets,
which give security applications and impart to RSUs by utilizing OBUs. They might be
particular units or might be coordinated with OBUs as a solitary unit. RSUs are conveyed as
settled units close by the street in an upgraded way so as to protect the scope and availability
to every one of the vehicles.They give correspondence among the vehicles utilizing
Dedicated Short Range Communication (DSRC) or with alternate RSUs and OBUs utilizing
IEEE 802.11p. Fig. 1 demonstrates the different segments of the summed up engineering
utilized as a part of VANETs. Steering in VANET is reliant on number of elements, for
example, speed, thickness, heading of movement of the vehicles and so forth. As appeared in
Fig. 1, vehicles can be source or destination amid the procedure of directing and different
benchmarks have been worked to fulfill the assignment of directing.
With the developing needs of the clients to get to different assets
Amidversatility,productive procedures are required to bolster their needs from client
fulfillment points of view. A definitive objectives of directing in VANETs are to give
security and solace to the clients sitting in the vehicles. A portion of the applications where
the need of directing is felt are: Generating alerts if there should be an occurrence of crisis
out and about/group, reconnaissance frameworks and so on.

Inter-Vehicle Communication

The inter vehicle correspondence setup utilizes multi-bounce multicast/telecast to transmit

activity related data over numerous jumps to a gathering of collectors. There are two sorts of
message sending in between vehicle correspondences: innocent television and astute TV[7].
In guileless TV, vehicles send show messages intermittently and at general interims. Endless
supply of the message, the vehicle disregards the message in the event that it has originated
from a vehicle behind it. On the off chance that the message originates from a vehicle in
front, the Getting vehicle sends its own particular telecast message to vehicles behind it.

Vehicle-to-roadsideCommunication
Vehicle-to-roadside Communication Called auto to-auto or vehicle-to-vehicle
correspondence, it gives cars a chance to telecast their position, rate, controlling wheel
position, brake status, and other data to various vehicles within two or three hundred
meters[8].

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Steering based Communication

The steering based correspondence arrangement is a multi-jump uncast where a message is

engendered in a multi-bounce style until the vehicle conveying the wanted information is
come to[9]. At the point when the question is gotten by a vehicle owning the wanted bit of
data, the application at that vehicle promptly sends a unicast message containing the data to
the vehicle it got the solicitation from, which is then accused of the undertaking of sending it
towards the inquiry source.

Models for Wireless Access in VANETs

Just using models can the prerequisites of interconnectivity and interoperability be ensured
and the rise of new items is checked to empower the fast execution of new advancements.
These measures range from conventions that apply to transponder hardware and
correspondence conventions through to security determination, steering, tending to
administrations, and interoperability conventions. Committed Short Range Communication
(DSRC) Committed Short Range Communications (DSRC) is a short to medium extent
correspondences benefit that was produced to bolster vehicle-to-vehicle and vehicle-to-
roadside interchanges[10]. Such correspondences cover an extensive variety of uses,
including vehicle-to-vehicle security messages, movement data, toll accumulation, drive-
through installment, and a few others. In 1999, the United States Federal Communications
Commission (FCC) designated 75 MHz of range at 5.9 MHz to be utilized by DSRC’[11].

Directing based Communication

The directing based correspondence setup is a multi-bounce uncast where a message is

proliferated in a multi-jump style until the vehicle conveying the wanted information is come
to[12]. At the point when the inquiry is gotten by a vehicle owning the craved bit of data, the
application at that vehicle quickly sends a unicast message containing the data to the vehicle
it got the solicitation from, which is then accused of the assignment of sending it towards the
question source.

Gauges for Wireless Access in VANETs

Just using gauges can the prerequisites of interconnectivity and interoperability be ensured
and the rise of new items is confirmed to empower the fast execution of new
innovations’[13]. These guidelines range from conventions that apply to transponder gear and
correspondence conventions through to security particular, directing, tending to
administrations, and interoperability conventions. Committed Short Range Communication
(DSRC) Committed Short Range Communications (DSRC) is a short to medium extent
correspondences benefit that was created to bolster vehicle-to-vehicle and vehicle-to-roadside
interchanges. Such correspondences cover an extensive variety of uses, including vehicle-to-
vehicle wellbeing messages, activity data, toll gathering, drive-through installment, and a few
others. In 1999, the United States Federal Communications Commission (FCC) designated 75
MHz of range at 5.9 MHz to be utilized by DSRC[14].
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Directing, Quos, Broadcasting, and Security in VANET

VANET has been a dynamic field of innovative work for a considerable length of time yet
any reasonable person would agree that, with the late sensational upgrades in correspondence
and registering advances, it is just in the most recent decade this field has truly picked up a
ton of force. Truth be told, VANET research has pulled in a great deal of consideration from
specialists working in different fields including gadgets, organizing, security, programming
designing, car, transportation, et cetera. Late results covering VANET-related issues
incorporate regions, for example, directing, Quality Service (Quos), television, security
assaults and dangers, limit, crash and impedance, the impacts of transmission force on
convention execution and force control calculations, clog control, and administration
revelation [15].

Qualities of VANETs

VANETs are a remote systems where hubs are the settled street units or the exceedingly
versatile vehicles. Hubs speak with each other in specially appointed mode and correspond
with altered hardware on the streets in base mode. Therefore, the attributes of VANETs are
fundamentally a blend of remote medium qualities what's more, the qualities of the diverse
topologies in specially appointed and framework modes. These qualities are:

– High portability: The high versatility of VANET hubs is one of the most essential
components. In ordinary operation of the system, hubs move all the time with various
velocities and headings. As per [5,8] the high portability of hubs decreases the network in the
system (less courses between hubs). Analyzed to MANET, VANET portability is generally
high. In the writing, Very researchessuch as have been uniquely committed to think about the
effect of versatility variable in specially appointed systems and particularly for vehicular
systems.

Dynamic topology: Given the high portability, VANET topology is evolving quickly, it is
accordingly rapid and flighty. The association times are short particularly between hubs
moving in inverse headings. This topology encourages the assault of the whole system, and
makes troublesome the location of glitch.

Frequent disengagements: The dynamic topology and the high versatility of hubs and in
addition different conditions, for example, atmosphere, the thickness of movement cause
regular detachments of vehicles from the system.

Availability of the transmission medium: The air is the transmission medium of VANETs.
In spite of the fact that the all inclusive accessibility of this remote transmission medium
which is one of the immense preferences in IVC, turns into the cause of some security issues,
identified with both the way of transmission in remote environment and to the security of
correspondences utilizing an open support.

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Anonymity of the bolster: Data transmission utilizing a remote medium is for the most part
mysterious. On the off chance that we leave aside the restrictions and regulations of
utilization, anybody furnished with a transmitter working in the same recurrence band can
transmit and hold the band [2].

Limited data transmission: The institutionalized DSRC band (5.850–5.925 GHz) for
VANET can be considered as restricted, the width of the whole band is just 75 MHz.
Limitations of use in some nations recommend that these 75 MHz are not all permitted. The
most extreme hypothetical throughput is 27 Mbps.

Attenuations: DSRC band has additionally transmission issues related to advanced

transmission with such frequencies, for example: reflection, diffraction, scattering, distinctive
sorts of blurring, Doppler impact, misfortunes and engendering delays because of multipath
reflections.

Limited transmission control: The transmission force is restricted in the WAVE design,
which restricts the separation that information can reach. This separation is up to 1000 m. Be
that as it may, in certain particular cases, for example, crisis and open wellbeing, it is
permitted to transmit with a higher force .

Energy stockpiling and processing: Unlike different sorts of versatile net- works, VANETs
don't experience the ill effects of issues of vitality, processing limit or capacity
disappointment. Be that as it may, ongoing processing necessity of expansive measure of data
is a test to remember.

Conclusion:

Vehicular Ad hoc NETworks(VANETs) are getting to be well known in Intelligent

Transportation Systems, they have been intended to give street wellbeing and administrations
to travelers solace. Given their significance identified with the wellbeing of people's lives,
VANETs draw in aggressors and speak to a most loved focus for a few sorts of assaults
which results fluctuate from unimportant to extreme. There- ore, securing VANETs
represents an incredible challenge. Over the most recent couple of decades, Vehicular Ad
Hoc Networks (VANETs) have developed as another effective innovation which can be
utilized in wide territories of uses, for example, Rescue and reconnaissance operations,
excitement and so on. For every one of these applications, there is a prerequisite of effective
directing procedures inside of the imperatives for example, high portability and consistent
topological changes of the vehicles.

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