mba _ finance

Business Environment

Business Environment - Chapter 10

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Chapter - 10: Business Resources

Types of Resources

Content

Resource Management

Consumer Protection Act 1986

Eleventh Five Year Plan (2007 - 2012)

To know the different type of resources that are utilized by an organization

Learning Objective

To understand how the organizations rationalize the use of the available

resources to attain competitive advantage


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Business Resources are the means available with an organization to achieve their

desired goals and objectives.

Selective hiring practices to make sure that right people become part of the organization;

Types of Resources

Physical Resources

Physical resources are the typical assets that appear on the companys balance

sheet. Reporting on the care and use of these assets is the primary focus of the

financial accounting system. Planning and organizing a companys physical

resources requires understanding how to use these resources to provide services

and products that customers value. Physical resources are the organizations

tangible resources such as cash, property and equipment.

Intellectual Resources

Intellectual Resources either does not show up on the company balance sheet and

appear only in a restricted manner. Intellectual resources are often further split into

human resources and structural resources. Human Resources of the organization include knowledge and skill of its employees which are the results of good hiring,

training and education. These also are the resources that easily can leave the

organization at any time. The organization would suffer if it could not attract and

retain talented and motivated employees. Structural resources result from applying and sharing knowledge and skills. These include organizations customer

relationships, database, organizational procedures and patented products and

services. These intellectual resources would stay with the organizations even if the

employees who created them walk away. Planning and organizing an organizations

intellectual resources require three critical things:

Management practices that motivate people to share their knowledge and stay in the organization; and

Legal and security measures to protect the structural resources that people create.


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India. Engineering and Technical

Resource Management

Resource management is the efficient and effective deployment of an organization's

resources when they are needed. Such resources may include financial resources,

inventory, human skills, production resources, or information technology (IT).

In any economy and every industry, companies compete for customers and

resources. Competition means there will be winners and losers. Winners of

economic competition create products and services that customers value and in

doing so they create job and opportunities for employees and investors. Cost

management information help the winners to increase customer value by helping to

manage quality and reduce cost by identifying opportunities to eliminate wasteful

processes and practices. For example, cost management information may indicate

that an organization could reduce cost by using services by other who specializes in

providing them. This is the main reason why in present scenario Business Process

Outsourcing provides a rich new source of competitive advantage.

Business process outsourcing (BPO) is defined simply as the movement of business processes from inside the organization to external service providers. With

the global telecommunications infrastructure now well-established and consistently

reliable, BPO initiatives often include shifting work to international providers, five

BPO international hot spots have emerged around the globe, although firms from

many other countries are specializing in various business processes and exporting

services;

China. Manufacturing and Technical

Mexico. Manufacturing

United States. Analysis and Creative

Philippines, Administrative

Each of these countries has complex economies that span the range of business

activity, but from a BPO perspective they have comparative advantages in the

specific functions cited. BPO is considered as a means of eliminating business

processes that are not part of the core competence of the organizations. Back-office


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functions such as payroll and benefits administration, customer service, call center,

and technical support are just a few of the processes that organizations of all sizes

have been able to outsource to others who specialize in those areas. Removing

back-office functions from their internal operations enables organizations to reduce

payroll and other overhead costs. In the next 15 years, Forrester Research predicts

that 3.3million service jobs will move to countries such as India, Russia, China, and

the Philippines. Earlier BPO adapters among fortune 100 companies include IBM,

American Express and General Electric.

HR (Human Resource) Management - The science of allocating human resources among various projects or business units, maximizing the utilization of available

personnel resources to achieve business goals; and performing the activities that are

necessary in the maintenance of that workforce through identification of staffing

requirements, planning and oversight of payroll and benefits, education and

professional development, and administering their work-life needs. The efficient and

effective deployment of an organization's personnel resources where and when they

are needed, and in possession of the tools, training and skills required by the work.

Knowledge Management (KM) - Knowledge is full utilization of information and data, coupled with the potential of peoples skills, competencies, ideas, intuitions,

commitments and motivations. In todays economy, knowledge is people, money,

learning, flexibility, power and competitive advantage. Knowledge is more relevant to

sustain Business than Capital, labor or land. Nevertheless, it remains the most

neglected asset. For Knowledge to be of value it must be focused, current, tested

and shared.

Knowledge management often encompasses identifying and mapping intellectual

assets within the organization, generating new knowledge for competitive advantage

within the organization, making vast amounts of corporate information accessible,

sharing of best practices and technology that enables all of the above including

groupware and intranets.


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Knowledge management is concerned with organizing knowledge repositories (data

bases etc.) so as to allow for easy retrieval and exchange of the information stored

therein.

CONSUMER PROTECTION ACT 1986

WHY CONSUMER PROTECTION ACT COME INFORCE?

Right to Safety

Means right to be protected against the marketing of goods and services, which are

hazardous to life and property. The purchased goods and services availed of should

not only meet their immediate needs, but also fulfil long term interests. Before

purchasing, consumers should insist on the quality of the products as well as on the

guarantee of the products and services. They should preferably purchase quality

marked products such as ISI, AGMARK, etc.

Right to be informed

Means right to be informed about the quality, quantity, potency, purity, standard and

price of goods so as to protect the consumer against unfair trade practices.

Consumer should insist on getting all the information about the product or service

before making a choice or a decision. This will enable him to act wisely and

responsibly and also enable him to desist from falling prey to high pressure selling

techniques.

Right to Choose

Means right to be assured, wherever possible of access to variety of goods and

services at competitive price. In case of monopolies, it means right to be assured of

satisfactory quality and service at a fair price. It also includes right to basic goods

and services. This is because unrestricted right of the minority to choose can mean a

denial for the majority of its fair share.


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Right to be heard

Means that consumers interests will receive due consideration at appropriate

forums. It also includes right to be represented in various forums formed to consider

the consumers welfare. The Consumers should form non-political and non-

commercial consumer organizations which can be given representation in various

committees formed by the Government and other bodies in matters relating to

consumers.

Right to seek redressal

Means right to seek redressal against unfair trade practices or unscrupulous

exploitation of consumers. It also includes right to fair settlement of the genuine

grievances of the consumer. Consumers must make complaint for their genuine

grievances. Many a times their complaint may be of small value but its impact on the

society as a whole may be very large. They can also take the help of consumer

organizations in seeking redressal of their grievances.

Right to Consumer Education

This means the right to acquire the knowledge and skill to be an informed to a

consumer throughout life. Ignorance of consumers, particularly of rural consumers, is

mainly responsible for their exploitation. They should know their rights and must

exercise them. Only then real consumer protection can be achieved with success.

WHAT ARE REQUIRMENTS FOR FILLING CONSUMER COMPLAINT BEFORE CONSUMER REDREESAL FORUM UNDER CONSUMER PROTECTION ACT 1986?

Every Complaint Should Complaints Covers Following Points:

Consumer Complaint

Affidavit of Complainant

Amount of DD be drawn only on a nationalized bank as per Consumer protection

Rules.


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Notice to Opposite Party.

Name & Address of the complainant in full.

Name & Address of the Opponent.

When and where cause of the complaint arose?

Particulars of the complaint in detail.

Relief prayed (such as Refund of Interest, Principal Amount. etc. physical mental

torture etc.). While asking for claims, the amount should be within reasonable

limits.

Copies of the relevant documents to be enclosed as Exhibits.

Total value of relief claimed.

WHAT IS JURISDICTION OF THE DISTRICT FORUM/STATE COMISSION/NATIONAL COMISSION UNDER CONSUMER PROTECTION ACT 1986?

Where the value of the goods or services and compensation (if any, claimed

uptoRs. 20 Lakhs) then complaint will come under Jurisdiction of District Forum.

If youre Claim is Up to RS. 20 Lakhs

The President,

The Consumer District Redressal Forum

Where the value of the goods or services and compensation, if any, claimed is

above Rs 20 Lakhs but uptoRs. 1 Cores. Then complaint will come under

Jurisdiction of State Commission.

If Your Claim is above Rs. 20 Lakhs but upto Rs.1 Cores:

Appeals against the orders of District Forum.

The President,

STATE CONSUMER COMMISSION


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If Your Claim is above Rs.1 Cores:

Where the value of the goods or services and compensation, if any, claimed

exceeds Rs. 1 Cores. Then complaint will come under Jurisdiction of National

Commission.

Appeals against the orders of any state commission

The President,

NATIONAL CONSUMER REDREESSAL COMMISSION

HOW MUCH FEES REQUIRED TO BE PAID UNDER CONSUMER PROTECTION ACT?

The Maharashtra State Consumer Disputes Redressal Commission has recently

issued a circular intimating that with effect from April1, 2004 fees are payable for

filing complaints under the Consumer Protection Act. According to the circular, these

fees have been prescribed by the Central Government, New Delhi, by amending the

Central Consumer Protection Rules. The fees payable are as under. The fees have

to be paid either by demand draft (DD) on a nationalized bank or through a crossed

Indian postal order drawn in favor of the of the President of the District Forum,

Registrar of the State Commission, or the Registrar of the National Commission as

the case may be and payable at the respective place where the District Forum, State

Commission or National Commission is Situated.

TABLE

SR. NO.

TOTAL VALUE OF GOODS OR SERVICES AND THE COMPENSATION CLAIMED

AMOUNT OF FEE

PAYABLE

DISTRICT FORUM

(1) Up to one lakh rupees For complainants who are under the Below

Poverty Line holding Antyodaya Anna Yojana Cards

Nil

(2) Up to one lakh rupees For complainants other than Antyodaya

Anna Yojana card holders.

Rs.100


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(3) Above one lakh and up to five lakh rupees Rs.200

(4) Above five lakh and up to ten lakh rupees Rs.400

(5) Above ten lakh and up to twenty lakh rupees Rs.500

STATE COMMISSION

(6) Above twenty lakh and up to fifty lakh rupees Rs.2000

(7) Above fifty lakh and up to one crores rupees Rs.4000

NATIONAL COMMISSION

(8) Above one crores rupees Rs.5000

Eleventh Five-Year Plan (20072012)

The eleventh plan has the following objectives:

Income & Poverty

Accelerate GDP growth from 8% to 10% and then maintain at 10% in the 12th

Plan in order to double per capita income by 2016-17

Increase agricultural GDP growth rate to 4% per year to ensure a broader spread

of benefits

Create 70 million new work opportunities.

Reduce educated unemployment to below 5%.

Raise real wage rate of unskilled workers by 20 percent.

Reduce the headcount ratio of consumption poverty by 10 percentage points.

Education

Reduce dropout rates of children from elementary school from 52.2% in 2003-04

to 20% by 2011-12

Develop minimum standards of educational attainment in elementary school, and

by regular testing monitor effectiveness of education to ensure quality

Increase literacy rate for persons of age 7 years or above to 85%


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Lower gender gap in literacy to 10 percentage point

Increase the percentage of each cohort going to higher education from the

present 10% to 15% by the end of the plan

Health

Reduce infant mortality rate to 28 and maternal mortality ratio to 1 per 1000 live

births

Reduce Total Fertility Rate to 2.1

Provide clean drinking water for all by 2009 and ensure that there are no slip-

backs

Reduce malnutrition among children of age group 0-3 to half its present level

Reduce anaemia among women and girls by 50% by the end of the plan

Women and Children

Raise the sex ratio for age group 0-6 to 935 by 2011-12 and to 950 by 2016-17

Ensure that at least 33 percent of the direct and indirect beneficiaries of all

government schemes are women and girl children

Ensure that all children enjoy a safe childhood, without any compulsion to work

Infrastructure

Ensure electricity connection to all villages and BPL households by 2009 and

round-the-clock power.

Ensure all-weather road connection to all habitation with population 1000 and

above (500 in hilly and tribal areas) by 2009, and ensure coverage of all

significant habitation by 2015

Connect every village by telephone by November 2007 and provide broadband

connectivity to all villages by 2012

Provide homestead sites to all by 2012 and step up the pace of house

construction for rural poor to cover all the poor by 2016-17


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Environment

Increase forest and tree cover by 5 percentage points.

Attain WHO standards of air quality in all major cities by 2012.

Treat all urban waste water by 2011-12 to clean river waters.

Increase energy efficiency by 20 percent Eleventh Five-Year Plan (20072012)

Chapter - 10: Business ResourcesDISTRICT FORUMSTATE COMMISSIONNATIONAL COMMISSION

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