B3.1-R3: Management Fundamentals And Information Systems 1. Introduction to Management 1. a) Define any four Fayol's Principles.

Ans :-- Management Principles developed by Henri Fayol: 1. DIVISION OF WORK: Work should be divided among individuals and groups to ensure that effort and attention are focused on special portions of the task. Fayol presented work specialization as the best way to use the human resources o f the organization. 2. AUTHORITY: The concepts of Authority and responsibility are closely rela ted. Authority was defined by Fayol as the right to give orders and the power to exact obedience. Responsibility involves being accountable, and is therefore na turally associated with authority. Whoever assumes authority also assumes respon sibility. 3. DISCIPLINE: A successful organization requires the common effort of work ers. Penalties should be applied judiciously to encourage this common effort. 4. UNITY OF COMMAND: Workers should receive orders from only one manager.

5. UNITY OF DIRECTION: The entire organization should be moving towards a c ommon objective in a common direction. 6. SUBORDINATION OF INDIVIDUAL INTERESTS TO THE GENERAL INTERESTS: The inte rests of one person should not take priority over the interests of the organizat ion as a whole. 7. REMUNERATION: Many variables, such as cost of living, supply of qualifie d personnel, general business conditions, and success of the business, should be considered in determining a workers rate of pay. 8. CENTRALIZATION: Fayol defined centralization as lowering the importance of the subordinate role. Decentralization is increasing the importance. The degr ee to which centralization or decentralization should be adopted depends on the specific organization in which the manager is working. 9. SCALAR CHAIN: Managers in hierarchies are part of a chain like authority scale. Each manager, from the first line supervisor to the president, possess c ertain amounts of authority. The President possesses the most authority; the fir st line supervisor the least. Lower level managers should always keep upper leve l managers informed of their work activities. The existence of a scalar chain an d adherence to it are necessary if the organization is to be successful. 10. ORDER: For the sake of efficiency and coordination, all materials and pe ople related to a specific kind of work should be treated as equally as possible . 11. EQUITY: All employees should be treated as equally as possible. 12. STABILITY OF TENURE OF PERSONNEL: Retaining productive employees should always be a high priority of management. Recruitment and Selection Costs, as wel l as increased product-reject rates are usually associated with hiring new worke rs.

13. INITIATIVE: Management should take steps to encourage worker initiative, which is defined as new or additional work activity undertaken through self dir ection. 14. ESPIRIT DE CORPS: Management should encourage harmony and general good f eelings among employees. 1. a) Explain any four Principal activities of Management Process. [4] ans :-- The main four activities of the management process are: Design (including modelling the management process) Execution (running the process) Monitoring (checking for problems) Optimisation (making the process better) BPM (business process management) is an integrated collection of critical softwa re technologies that enables the control and management of business processes. B PM emphasizes business user involvement in the entire business process improveme nt life cycle, from design through implementation, deployment, monitoring and on going optimization. Instead of reducing relience on employees, BPM - Business Pr ocess Management software emphasizes the added value of employee activity coordi dantion and making their business activities tranparent and auditable Business P rocess Management enables business stakeholders to monitor all interactions betw een human, system and information resources and optimise behavior to get the mos t out of dynamic market events and improve business performance outcomes. 4. c) A common misconception is that organizations with to have managers with technical skills and not with human relations skills. Why this statement is not correct? [6] January-2006 [0] July-2006[4] 1. a) Explain the skills, which a manager should possess. [4] ans :-- There are three fundamental skills of a manager: 1. TECHNICAL The manager should be proficient at specific tasks. This in turn helps to provid e the credibility or knowledge to persuade people to do certain things. 2. HUMAN The manager has to know how to work with people. 3. CONCEPTUAL The manager can see the organisation as a whole. In other words, there has to be some knowledge of the organisation and what it does and how it interacts with o ther organisations. The most important skill of a manager For more specific skills, here is a list compiled by management experts in decre asing order of importance: 1. People skills 2. Strategic thinking (planning ahead and predicting what was going to happ en) 3. Visionary 4. Flexible/adaptable to change 5. Self-management 6. Team player 7. Solve-complex problems and make decisions 8. Ethical/high personal standards Hence the most important skill of a manager is to understand people and what mak es them motivated to do the work in the acheivement of certain goal(s).

Are managers leaders? Firstly we need to know the difference between a leader and a manager. A leader is someone described as a creative genius who has the vision of leading his/her people within an entire organisation or nation to something that we can all believe in and realistically achieve as something worthwhile to strive for in our lives. A manager is someone described as a practical genius who is aware of the vision for an entire organisation or nation and can achieve various goal(s) to help rea ch for this vision in a practical way. Now a good manager is one that has both managerial and leadership skills. Thus a manager can be a leader. It all depends on the person's upbringing, nature of t he managerial job, and the kind of knowledge and experience they acquire to beco me a good manager. January-2007 [0] July-2007 [4] 1. a) Explain in brief, four main propositions of classical approach to manage ment. [4] ans :-January-2008 [0] 2. Planning January-2004 [18] 2. a) 'Managerial planning seeks to achieve a coordinated structure of operati ons.' Comment. [6] b) 'Policies are guideposts for managerial action.' Do you agree with the s tatement? Support your answer with reasons. [6] c) Explain role of procedures and budget for effective planning. [6] July-2004 [11] 1. Give very brief (2-3 lines) answers to the following questions: b) Differentiate between Strategy and Policy. [2] 4. a) Bring out the essentials of planning process. [4] b) Discuss role of budget as a tool of planning. [5] ans :-January-2005 [5] 1. a) Give very brief answers to the following questions: iii) Name any two forecasting tools widely used in business forecasting. [2] b) Define the following: v) SWOT [1] c) Distinguish between iv) Strategy and Strategic Policy

[2] July-2005 [0] January-2006 [8] 1. a) Explain the role of SWOT Analysis in planning. [4] c) Discuss various steps of planning process [4] ans :-- Planning Selection of short- and long-term objectives and the drawing up of tactical and strategic plans to achieve those objectives. In planning, managers outline the s teps to be taken in moving the organization toward its objectives. After decidin g on a set of strategies to be followed, the organization needs more specific pl ans, such as locations, methods of financing, hours of operations, and so on. As these plans are made, they will he communicated throughout the organization. Wh en implemented, the plans will serve to coordinate, or meld together, the effort s of all parts of the organization toward the company's objectives. Step 1: Step 2: Step 3: Step 4: Step 5: ategy Step 6: Step 7: Step 8: How How How How How to to to to to prepare to plan - analyse stakeholder involvement analyse situations and needs prioritise and select a goal and purpose develop clear objectives identify alternative strategies and select the most effective str

How to plan implementation How to plan for evaluation How to summarise your plan

July-2006[10] 1. d) What do you understand by SWOT Analysis? [4] ans :-- SWOT Analysis means S- Strength of organization W- Weakness of organization O- Opportunity available in market for organization T- Threat in the market to the organization. In which S & W is internal factors and O & T is from outside environmental facto rs. SWOT analysis is important to organization for taking all decision regarding bus iness. SWOT analysis give the idea of what is our weak point, what is our core compete ncy, where ther gap is in the market. etc. In short, it helps you to take any decisions related to business. What Does SWOT Analysis Mean? A tool that identifies the strengths, weaknesses, opportunities and threats of a n organization. Specifically, SWOT is a basic, straightforward model that assess es what an organization can and cannot do as well as its potential opportunities and threats. The method of SWOT analysis is to take the information from an env ironmental analysis and separate it into internal (strengths and weaknesses) and external issues (opportunities and threats). Once this is completed, SWOT analy sis determines what may assist the firm in accomplishing its objectives, and wha t obstacles must be overcome or minimized to achieve desired results. Investopedia explains SWOT Analysis When using SWOT analysis, be realistic about the strengths and weaknesses of you

r organization. Distinguish between where your organization is today, and where it could be in the future. Also remember to be specific by avoiding gray areas a nd always analyze in relation to the competition (i.e. are you better or worse t han competition?). Finally, keep your SWOT analysis short and simple, and avoid complexity and over-analysis since much of the information is subjective. Thus, use it as a guide and not a prescription. 2. a) Managerial planning is a mere ritual in a fast changing environment. Comme nt. [6] January-2007 [3] 5. b) Discuss the following: iii) SWOT Analysis [3] July-2007 [6] 2. a) Distinguish between Mission and Vision. How are goals set in Management by o bjectives? [6] January-2008 [12] 2. b) What is the relevance of forecasting in business? Name any two forecasti ng tools widely used in business forecasting. [6] 7. b) Distinguish between Mission and Vision. How are goals set in Management by o bjectives? [6] ans :-- Organizations, from small to large, create vision and/or mission stateme nts to convey what the organization aspires to be, why it exists, who it serves, and what it hopes to achieve in the future. Some organizations distinguish between their vision and mission, while others bl end the two into one statement. Vision and mission statements vary in length, an ywhere from a slogan to an executive summary. Characteristics of both a vision and mission statement include: Focusing on the big picture Realistic to be both practical and workable Motivating to inspire commitment from employees, stakeholders, and customers Short and concise- short enough to be easily remember and concise enough to conv ey a clear message The Difference between Vision & Mission The first step to developing an organizations vision and mission is to understan d the difference: Vision - The Future Definition: The way in which one sees or conceives something; a mental image; An overall statement of the goal of the organization. Mission - The Present Definition: An assignment one is sent to carry out; a self-imposed duty. A missi on statement identifies the reason for the existence of the organization. The st atement should be linked to the overall operations and business of the organizat ion. Creating a Vision & Mission Statement is Like Planning a Trip If you dont know where you are going, youll end up somewhere else. The next step for developing a vision and mission is to look at the process from a different perspective: Vision = the Destination Mission = the Vehicle

Strategy = the Road Map Knowing the destination of your organization tells you the type of vehicle you n eed to reach that destination. If your goal is to lie in a hammock on a small tr opical island in the middle of the Pacific, then you know a car wont get you ther e. So if your organization is a car, will that vehicle get you to your destination ? If not, you need to re-engineer your vehicle (mission) to reach your destinati on (vision). Vision (Destination) Whats the destination of the organization? Visualize what the organization would look like in 5 and 10 years. Describe the detail: who are your customers, what d o your products or services look like, who is your market, what is your revenue, how many employees do you have, etc. Remember this is the future. Mission (Vehicle) What is the focus of your organization? How are you structured to achieve your o rganizations goal or objectives? What are your organizations values and core compe tencies? Remember this is your present operation, you may identify changes neede d to your vehicle in order to reach your destination. 3. Organizing January-2004 [18] 3. a) 'Organisation is an important tool to achieve enterprise objective.' Exp lain this statement with help of steps in organization. [6] b) Define span of control. Explain the factors, which determine span of con trol. [7] c) Explain basic principles of organization. [5] July-2004 [2] 1. Give very brief (2-3 lines) answers to the following questions: c) Define span of management. [2] January-2005 [19] 1. a) Give very brief answers to the following questions: i) Explain the concept of matrix organization. [2] c) Distinguish between v) Delegation and Decentralization [2] 2. a) "Sound organisational structure is an essential prerequisite of effectiv e management" Comment. [5] 5. a) What are the similarities and differences between delegation and empower ment? [10] July-2005 [12] 1. c) Sound organizational structure is an essential prerequisite of effective management Do you agree with the above? Justify your answer. [4] b) Describe the logical relationships between division of work, departmenta lization, hierarchy and co-ordination. [8]

January-2006 [8] 1. g) Distinguish between: ii) Authority and Responsibility [2] 7. b) Write short notes on any three of the following: i) Information organisations [3] ii) Knowledge Level systems in an organization [3] July-2006[19] 1. c) Organising consists of two sub-processesdifferentiation and integration. [4] Ans: Differentiation is the process of deciding how to divide the work in an org anization. Differentiation ensures that all essential organization tasks are ass igned to none or more jobs and that the tasks receive the attention they need. T hree different forms of differentiation are horizontal, vertical and spatial. Integration is the process of coordinating the different parts of an organizatio n to achieve unity among individuals and groups in various jobs, departments, an d divisions in the accomplishedment of organization goals and tasks. Integratio n helps keep the organization in the state of dynamic equilibrium, condition in which all the parts of organization are interrelated and balanced, both vertical ly and horizontally.

2. b) Delegation of authority is the key to organization. Discuss the statement and state the guidelines for effective delegation of authority. [8] 3. a) Formal and informal organizations are not two different forms, but are tw o dimensions of the same organization. Discuss and bring out clearly the differen ces between the two. [7] January-2007 [9] 6. a) What is the theory of organizational behaviour? Explain the nature of Or ganisational Behaviour. [9] Ans: Organizational Behavior (OB) is the study and application of knowledge abou t how people, individuals, and groups act in organizations. It does this by taki ng a system approach. That is, it interprets people-organization relationships i n terms of the whole person, whole group, whole organization, and whole social s ystem. Its purpose is to build better relationships by achieving human objective s, organizational objectives, and social objectives. Organizational behavior enc ompasses a wide range of topics, such as human behavior, change, leadership, tea ms, etc. There are four major models or frameworks that organizations operate out of: Autocratic - The basis of this model is power with a managerial orientation of a uthority. The employees in turn are oriented towards obedience and dependence on

the boss. The employee need that is met is subsistence. The performance result is minimal. Custodial ntation of money. ts and dependence . The performance - The basis of this model is economic resources with a managerial orie The employees in turn are oriented towards security and benefi on the organization. The employee need that is met is security result is passive cooperation.

Supportive - The basis of this model is leadership with a managerial orientation of support. The employees in turn are oriented towards job performance and part icipation. The employee need that is met is status and recognition. The performa nce result is awakened drives. Collegial - The basis of this model is partnership with a managerial orientati on of teamwork. The employees in turn are oriented towards responsible behavior and self-discipline. The employee need that is met is self-actualization. The pe rformance result is moderate enthusiasm. Nature of OB The field of OB attempts to understand human behavior in Organizational settings , the organization itself, and the individual organization interface. All these areas are highly interrelated. Thus, although it is possble to focus on only one of these areas at a time, a complete understanding of Ob requires knowledge of all three areas. Thus the field of OB is exciting and complex. Environment -->Human behavior in organization settings<-->individual organizatio n interface. OB has three levels of performance analyses viz., The Individual, The group and the Formal ORganization. OB is a contingency orientation approach that is directed towards developing man agerial actions that are most appropriate for a specific situation and the peopl e involved. OB is a source of knowledge and repository of information by theorists, research ers and practitioners. OB is science and art as it contains the skill and knowledge of applying it July-2007 [13] 1. c) What are the main principles of delegation of authority? [4] 5. b) Distinguish between Formal and Informal Organization. [9] January-2008 [26] 1. d) Explain the concept of matrix organization. [4] e) Given a choice between delegations and empowerment, suggest which one sh ould be adopted by a HR-Manager to enhance organizations efficiency and effective ness. [4] 2. a) Sound organizational structure is an essential prerequisite of effective management. Comment.

[6] 4. a) Formal and informal organizations are not two different forms, but are tw o dimensions of the same organizations. Discuss and bring out clearly the differe nces between the two. [6] 6. a) Why is innovation a very important expect of sustainence in modern busin esses? How is innovation typically managed in an organization? [6] 4. Staffing January-2004 [4] 1. Give brief (one or two sentence) answers to the following questions: c) Define any one method of Job analysis. [2] Ans: Job analysis methods can be categorized into four basic types: (1) Observation methods; Observation of work activities and worker behaviors is a method of job a nalysis which can be used independently or in combination with other methods of job analysis. Three methods of job analysis based on observation are: (1) direct observation; (2) work methods analysis, including time and motion study and mic ro-motion analysis; and (3) the critical incident technique. (2) Interview techniques; Manager or a group of people hold personal interview for the selecting o f candidate. On the basis of performance in the interview the candidate are sele cted. (3) Questionnaires, including job inventories or Some selected questions are written in a paper and the candidates are al lowed to answer the question. On the basis of their performance in the exam they are selected. (4) Checklists.

d)

Differentiate between Job enlargement and Job enrichment. [2]

July-2004 [2] 1. Give very brief (2-3 lines) answers to the following questions: d) Define job enrichment. [2] January-2005 [0] July-2005 [4] 1. e) Distinguish between Job Enrichment and Job Enlargement. Illustrate with examples. [4] January-2006 [2] 1. g) Distinguish between: i) Job Rotation and Job Enrichment [2]

Ans: Job rotation is process of moving employees from one job to another in orde r to reduce boredom, increase job satisfaction and allow employees to gain more insight into the process of the business/ company. Job enlargement seeks to reduce boredom and increase employee's satisfaction by increasing the number of tasks the worker does. Both job enlargement and job rotation are alternatives to job specialization. July-2006[0] January-2007 [6] b) Discuss the following: i) Job Design and Appraisal [3] Ans: Job Design:-Through job design, organizations try to raise productivity levels b y offering non-monetary rewards such as greater satisfaction from a sense of per sonal achievement in meeting the increased challenge and responsibility of one's work. Job enlargement, job enrichment, job rotation, and job simplification are the various techniques used in a job design exercise. Job Appraisal:- Appraisal is the third and last stage in using formal decision m ethods. The objective of the appraisal stage is for the decision maker to develo p insight into the decision and determine a clear course of action. Much of the insight developed in this stage results from exploring the implications of the f ormal decision model developed during the formulation stage. ii) Job Description [3]

Ans: A job description is a list of the general tasks, or functions, and respons ibilities of a position. Typically, it also includes to whom the position report s, specifications such as the qualifications needed by the person in the job, sa lary range for the position, etc. A job description is usually developed by cond ucting a job analysis, which includes examining the tasks and sequences of tasks necessary to perform the job. The analysis looks at the areas of knowledge and skills needed by the job. July-2007 [4] 1. b) What do you mean by job rotation, job enlargement and job enrichment? [4] January-2008 [4] 1. g) Job rotation is one of the ways to make a job enriched. Is the statement t rue or false? Justify. [4] Ans: Job rotation is just like job enlargement by training and teaching the wo rkers to do several different jobs. By training workers to do everyone's job ar e enriching the workers job knowledge and benefitting the company. Because job r otations see the immediate results of their learning, they are more likely to de velop a passion for learning about the job. Job rotation may be especially valua ble for organizations that require firm-specific skills because it provides an i

ncentive to organizations to promote from within because that is when they are m ost likely to find the needed skill sets. An example of this, is the business my mom works at it believes in cross training its employees by teaching them to be ... 5. Directing (incl. Decision Making) January-2004 [0] July-2004 [20] 1. Give very brief (2-3 lines) answers to the following questions: e) Define motivation process. [2] 5. a) Explaing Herzberg's two factors theory of motivation. [6] b) Explaing any one model of leadership. [6] c) Explain role of motivation in leadership. [6] January-2005 [18] 1. a) Give very brief answers to the following questions: ii) What is the "great-man" approach to leadership? [2] 2. b) "Leadership style should be sustainable and it can not be unless it come s from within." In the light of the statement, discuss various leadership styles . [10] 7. a) In what ways does using an electronic spreadsheet package provide today' s manager with the necessary capabilities for effective decision-making? [6] July-2005 [32] 1. f) Compare and contrast between programmed decisions and non-programmed dec isions. Give two examples of each. [4] 2. a) Explain the rational decision making process? Explain the importance of Decision Support System in the decision making process. [10] 3. a) How is Maslows hierarchy of needs related to motivation in organizations? [8] b) Explain the major contingency approaches to leadership. [10] January-2006 [5] 6. b) What is decision making? Discuss various types of decision-making enviro nments. [5] July-2006[11] 1. b) Leadership is an interpersonal influence process. Explain. [4] 3.

b) tem?

Define Communication. What are the essentials for good communication sys [7]

January-2007 [9] 3. a) Discuss Decision Making System. What are the types and nature of decisio ns? Explain. [9] July-2007 [10] 1. d) Explain the five needs in the Needs Hierarchy given by Maslow. [4] 4. a) Explain the different systems of leadership. What are the merits and lim itations of democratic leadership style? [6] January-2008 [5] 3. a) What are the four stages of decision making as described by Simon? [5] Ans: Simon described 4 different stages in decision making: intelligence, design , choice and implementation. Stages in Decision making, Information requirement and supporting information systems Stage of Decision making Information requirement Example system Intelligence Design Choice Implementation Exception reporting Simulation prototype What if simulation Graphics, charts MIS DSS, KWS DSS; large models PC and mainframe decision aids. Intelligence consists of identifying the problems occurring in the organisation. Intelligence indicates why, where and with what effects a situation occurs. During design the individual designs possible solutions to the problems. This ac tivity may require more intelligence so that a manager can decide if a particular solut ion is appropriate. The third stage, choice consists of choosing among alternatives. Here a manager can use information tools that can calculate and keep track of the consequences, cos ts and opportunities provided by each alternative designed in the second stage The last stage in decision making is implementation. Here managers can use a reporting system that delivers routine reports on the progress of a specific sol ution. The system will also report some of the difficulties that will arise, will indic

ate resource constraints and will suggest possible improvement actions

6. Controlling January-2004 [2] 1. Give brief (one or two sentence) answers to the following questions: b) Why Planning and Control are interdependent? [2] Ans: Effective system control requires good planning. If the controls are to work, they must be planned. All control technique and system reflect the plan th ey are designed to follow. Thus Planning and control are interdependent. July-2004 [2] 1. Give very brief (2-3 lines) answers to the following questions: f) Explain Mechanism of Control. [2] Ans: A basics control process involves three steps: 1. Essential standards 2. Measuring performance against these standards. 3. Correcting Variations from standards and plans 4. Evaluating the result. There are three types of control Input Feed forward Control Conversion Process Concurrent Control Outputs

Feedback Control

January-2005 [15] 4. a) "The controlling function of management is similar to the function of a thermostat in a refrigerator." Elucidate the statement and bring out the main st eps in the control process. [10] Ans: The main steps of control process are:1. Establish standards of performance, goals or targets against which perfo rmance is evaluated: - Goals or targets against which performance are to be eval uated. Standards must be consistent with strategy, for a low cost strategy, stan dards should focus closely on cost. Managers at each level need to set their own standards. 2. Measure actual performance: Managers can measure outputs resulting from worker behaviour or they can measure the behaviour themselves. The more non-routine the task, the harder to measure Managers then measure the behaviour nor output. 3. Compare actual performance against chosen standards: Managers must decid e if performance actually deviates. Often, several problems combine creating low performance.

4. Evaluate results and take corrective action when the standard is not bei ng achieved.: Perhaps the standards have been set too high. Workers may need add itional training, or equipment. This steps is often hard since the environment is constantly changing. b) State the role of a good management information system in achieving an e fficient and effective control system in an organisation. [5] July-2005 [4] 1. b) What are the involved in a basic control process. [4] January-2006 [4] 1. f) What is an effective control system? Discuss. [4] July-2006[0] January-2007 [0] July-2007 [4] 1. e) What are the essentials of a good system of control? Enumerate them. [4] Ans: A good control system should: 1. Be flexible so managers can respond as needed. 2. Provide accurate information about the organization. 3. Provide information in a timely manner. 4. Evaluate good result. January-2008 [6] 6. c) State the role of a good management information system in achieving an e fficient and effective control system in an organization. [6] Ans: 7. Production and Operations Management January-2004 [24] 1. Give brief (one or two sentence) answers to the following questions: e) What is production planning? [2] Ans: A decision of the future quantity to produce. This is based on orders from customers, production capacities, often a demand forecast, and the diverse inven tory levels in the supply chain. a) Distinguish between efficiency and effectiveness. [2] Ans: 1. Efficiency is a productivity metrics meaning how fast one can do someth

ing. Effectiveness is a quality metrics meaning how good a person is at tes ting. 2. Effectiveness means being able to achieve a set goal while Efficiency is achieving the goals with minimum resources 3. Effectiveness= System Size/No of defects found by testing Efficiency= No of test cases executed/Total number test cases. 4.Efficiency concerns about the 'means'. Effectiveness concerns about the 'ends'

m)

Explain any one technique of inventory control. [2]

6. a) Distinguish between routing and scheduling in production planning and co ntrol. [7] Ans: Routing: Under this, the operations, their path and sequence are establis hed. To perform these operations the proper class of machines and personnel required are also worked out. The main aim of routing is to determine the best and cheapest sequence of operations and to ensure that this sequence is strictly followed. In small enterprises, this job is usually done by entrepreneur himself in a rather adhoc manner. Routing procedure involves following different activities. 1) An analysis of the article to determine what to make and what to buy. (2) To determine the quality and type of material (3) Determining the manufacturing operations and their sequence. (4) A determination of lot sizes (5) Determination of scrap factors (6) An analysis of cost of the article (7) Organization of production control forms. Scheduling: It means working out of time that should be required to perform each operation and also the time necessary to perform the entire series as routed, making allowances for all factors concerned. It mainly concerns with time element and priorities of a job. The pattern of scheduling differs from one job to another which is explained as below Production schedule: The main aim is to schedule that amount of work which can easily be handled by plant and equipment without interference. Its not

independent decision as it takes into account following factors. (1) Physical plant facilities of the type required to process the material being scheduled. (2) Personnel who possess the desired skills and experience to operate the equipment and perform the type of work involved. (3) Necessary materials and purchased parts. Master Schedule: Scheduling usually starts with preparation of master schedule which is weekly or monthly break-down of the production requirement for each product for a definite time period, by having this as a running record of total production requirements the entrepreneur is in better position to shift the production from one product to another as per the changed production requirements. This forms a base for all subsequent scheduling acclivities. A master schedule is followed by operator schedule which fixes total time required to do a piece of work with a given machine or which shows the time required to do each detailed operation of a given job with a given machine or process Manufacturing schedule: It is prepared on the basis of type of manufacturing process involved. It is very useful where single or few products are manufacture d repeatedly at regular intervals. Thus it would show the required quality of each product and sequence in which the same to be operated Scheduling of Job order manufacturing: Scheduling acquires greater importance in job order manufacturing. This will enable the speedy execution of job at each center point As far as small scale industry is concerned scheduling is of utmost importance as it brings out efficiency in the operations and s reduces cost price. The small entrepreneur should maintain four types of schedules to have a close scrutiny of all stages namely an enquiry schedule, a production schedule, a shop schedule an d an arrears schedule out of above four, a shop schedule is the most important mos t suited to the needs of small scale industry as it enables a foreman to see at a glance.

Routing 1.Their path and sequence are established

Scheduling

2. To perform these operations the proper class of machines and personnel requir ed are also worked out. 3. main aim of routing is to determine the best and cheapest sequence of operati ons 4.It doesnt brings out efficiency in the operations 5. It determine quality and type of material 6. It does not cost 7.Determining the manufacturing operations and their sequence 1. Working

out of required time 2. Working out of time required to perform each operation

3.main aim is to schedule that amount of work which can easily be handled by pla nt and equipment without interference 4.brings out efficiency in the operations 5. It doesnt determine quality and type of material 6.It reduce cost 7. It determine the job order in manufacturing.

b) Discuss the role of statistical quality control in ensuring better produ ct quality. [5] Ans: Statistical process control (SPC) is an effective method of monitoring a p rocess through the use of control charts. Control charts enable the use of objec tive criteria for distinguishing background variation from events of significanc e based on statistical techniques. Much of its power lies in the ability to moni tor both process center and its variation about that center. By collecting data from samples at various points within the process, variations in the process tha t may affect the quality of the end product or service can be detected and corre cted, thus reducing waste as well as the likelihood that problems will be passed on to the customer. With its emphasis on early detection and prevention of prob lems, SPC has a distinct advantage over quality methods, such as inspection, tha t apply resources to detecting and correcting problems in the end product or ser vice. In addition to reducing waste, SPC can lead to a reduction in the time required to produce the product or service from end to end. This is partially due to a di minished likelihood that the final product will have to be reworked, but it may also result from using SPC data to identify bottlenecks, wait times, and other s ources of delays within the process. Process cycle time reductions coupled with improvements in yield have made SPC a valuable tool from both a cost reduction a nd a customer satisfaction standpoint. c) What important factors should be taken into account in deciding the loca tion of i) a sugar mill? ii) a textile mill? [6] July-2004 [2] 1. Give very brief (2-3 lines) answers to the following questions: g) Explain any one inventory control method. [2]

January-2005 [10] 1. b) Define the following: iv) EOQ [1] Ans: Economic order quantity is the level of inventory that minimizes the total inventory holding costs and ordering costs. It is one of the oldest classical pr oduction scheduling models. The framework used to determine this order quantity c) i) Distinguish between Production and Productivity [2]

Ans: Production Productivity 1.Production refers to the physical output in the production process. For exampl e, 10 cars...but it does not say the 10 cars are made by 10 workers or 100 worke rs. 2. Production being the amount of product (be it physical product or labor) that is output. 3. Production is the actual amount produced (output), or the act of producing it , without measuring the input.

1. Productivity is production with respect to another factor such as tim e, people, money, etc. For example, 10 cars/day or 10 cars/100workers or 10 cars /$10,000 labor cost, etc. 2.Productivity being the amount of work we get for the cost our are spending 3. Productivity is the measure of how much we produce.

ii)

Efficiency and Effectiveness [2]

5. b) Explain the role of statistical quality control is ensuring better produ ct quality. [5] July-2005 [6] 4. a) Why aggregate planning is necessary in operations management? [6] Ans: Aggregate planning is an operational activity which does an aggregate plan for the production process, in advance of 2 to 18 months, to give an idea to man agement as to what quantity of materials and other resources are to be procured

and when, so that the total cost of operations of the organization is kept to th e minimum over that period. The quantity of outsourcing, subcontracting of items, overtime of labor, numbers to be hired and fired in each period and the amount of inventory to be held in stock and to be backlogged for each period are decided. All of these activities are done within the framework of the company ethics, policies, and long term com mitment to the society, community and the country of operation. Aggregate planning has certain prerequired inputs which are inevitable. They inc lude: Information about the resources and the facilities available. Demand forecast for the period for which the planning has to be done. Cost of various alternatives and resources. This includes cost of holding invent ory, ordering cost, cost of production through various production alternatives l ike subcontracting, backordering and overtime. Organizational policies regarding the usage of above alternatives. January-2006 [19] 1. b) State the objectives of production planning and control. [4] Ans: 1. Have an overview of the production operation management system. 2. Obtain knowledge of management tools in production operations management. 3. Improve production operations and monitoring systems and reduce the cost of o perations. 4. Make better decisions and resolve operations problems in a faster and lo gical manner using appropriate techniques. 2. c)

Discuss any two types of control charts. [4] Ans: Control charts, also known as Shewhart charts or process-behaviour charts, in statistical process control are tools used to determine whether a manufacturi ng or business process is in a state of statistical control or not. Control charts fall into two categories: Variable and Attribute Control Charts. Variable data are data that can be measured on a continuous scale such as a ther mometer, a weighing scale, or a tape rule. One type of Variables Control Chart i s the X - R Chart, which is the chart described in this technique. Attribute data are data that are counted, for example, as good or defective, as possessing or not possessing a particular characteristic. The attribute type cha rt are np Chart - for measurements which are counted, such as number of parts defective . p Chart - for percentage measurements, such as percentage of parts defective. c Chart - for measuring defects in units of constant size, for example, numbe r of imperfections in panes of glass.

4. c)

Defineii) SQC [1] Ans: Statistical Quality Control (also look at Statistical Process Control) is s tatistical approach to the study of manufacturing process variation for the purp

ose of improving the effectiveness of the process. The idea, is that by collecting relevant data for a statistically significant sa mple size of something that was manufactured, you can use statistics to predict what the yield of the process will be iv) [1] CAM

Ans: Computer-aided manufacturing (CAM) is the use of computer-based software to ols that assist engineers and machinists in manufacturing or prototyping product components. Its primary purpose is to create a faster production process and co mponents with more precise dimensions and material consistency, which in some ca ses, uses only the required amount of raw material (thus minimizing waste), whil e simultaneously reducing energy consumption. CAM is a programming tool that mak es it possible to manufacture physical models using computer-aided design (CAD) programs. CAM creates real life versions of components designed within a softwar e package

5. a)

What are the factors determining production control procedures? Explain. [9]

July-2006[18] 1. e) Explain the main objectives of Statistical Quality Control. [4] Ans: 1. 2. product or 3. 4. 5. 4. a) dentify quality problems during the production process. Identify a change or variation in some quality characteristic of the process. continuous improvement of quality customer-driven quality standards focus on managerial leadership.

Explain the meaning and objectives of Quality Control. [7]

Ans: Quality control is a process employed to ensure a certain level of quality in a product or service. It may include whatever actions a business deems neces sary to provide for the control and verification of certain characteristics of a product or service. The basic goal of quality control is to ensure that the pro ducts, services, or processes provided meet specific requirements and are depend able, satisfactory, and fiscally sound. Objectives of Quality Control are: 1) quality control involves the examination of a product, service, or proce ss for certain minimum levels of quality 2) The goal of a quality control team is to identify products or services t hat do not meet a companys specified standards of quality 3) If a problem is identified, the job of a quality control team or profess ional may involve stopping production temporarily 4) quality control is considered in terms of human beings, it concerns corr ectable issues

5) 6) 7)

Increase productivity Improved quality of product Lower the cost of production.

b) What is product life cycle? Discuss the different stages in the lifecycl e of a product. [7] Ans : A new product progresses through a sequence of stages from introduction to growth, maturity, and decline. This sequence is known as the product life cycle and is associated with changes in the marketing situation, thus impacting the m arketing strategy and the marketing mix. Different stages of product lifecycle are: 1.Market introduction stage I:* costs are high II:* slow sales volumes to start III:* little or no competition - competitive manufacturers watch for acceptance/ segment growth losses IV:* demand has to be created V:* customers have to be prompted to try the product VI: makes no money at this stage 2.Growth stage I:* costs reduced due to economies of scale II:* sales volume increases significantly III:* profitability begins to rise IV:* public awareness increases V:* competition begins to increase with a few new players in establishing market VI:* increased competition leads to price decreases 3. Mature stage I:* Costs are lowered as a result of production volumes increasing and experienc e curve effects II:* sales volume peaks and market saturation is reached III:* increase in competitors entering the market IV:* prices tend to drop due to the proliferation of competing products V:* brand differentiation and feature diversification is emphasized to maintain or increase market share VI:* Industrial profits go down 4.Saturation and decline stage I:* costs become counter-optimal II:* sales volume decline or stabilize III:* prices, profitability diminish IV:* profit becomes more a challenge of production/distribution efficiency than increased sales

January-2007 [26] 1. b) What are the Jobs of Production and Operations Management? Explain. [4] Ans: Job production involves producing a one-off product for a specific customer . Job production is most often associated with small firms (making railings for

a specific house, building/repairing a computer for a specific customer, making flower arrangements for a specific wedding etc.) but large firms use job product ion too. Examples include: Designing and implementing an advertising campaign Auditing the accounts of a large public limited company Building a new factory Installing machinery in a factory Operations management is an area of business concerned with the production of go ods and services, and involves the responsibility of ensuring that business oper ations are efficient in terms of using as little resource as needed, and effecti ve in terms of meeting customer requirements. It is concerned with managing the process that converts inputs (in the forms of materials, labour and energy) into outputs (in the form of goods and services). d) What are the elements of Production Control? [4]

3. b) What is Statistical Quality Control? What are the areas of usages of sta tistical quality control? Discuss. [9] 4. a) Define Material Requirements Planning (MRP). What are the objectives of MRP? Discuss. [9] Ans: Material Requirements Planning (MRP) is a software based production planni ng and inventory control system used to manage manufacturing processes. Although it is not common now-a-days, it is possible to conduct MRP by hand as well. MRP is a simple system of calculating arithmetically the requireme nts of the input materials at different points of time based on actual productio n plan. MRP can also be defined as a planning and scheduling system to meet time -phased materials requirements for production operations. MRP always tries to me et the delivery schedule of end products as specified in the master production s chedule. An MRP system is intended to simultaneously meet three objectives: Ensure materials and products are available for production and delivery to custo mers. Maintain the lowest possible level of inventory. Plan manufacturing activities, delivery schedules and purchasing activities. Meeting Delivery Schedule: By minimizing the delays in materials procurement, production decision making, MRP helps avoid delays in production thereby meeting delivery schedules more consistently. Improved Performance: By stream lining the production operations and minimizing the unplanned interruptions, MRP focuses on having all components available at right place in right quantity at right time. Improve customer service. Minimize inventory investment. Maximize production operating effiencies.

July-2007 [10] 1. f) What are the main stages in the development of a new product? List them in brief. [4] 2. b) Explain the importance of production planning. List the steps in the proce

ss of production planning. [6] Ans: January-2008 [6] 4. c) What is a product life cycle? Discuss different stages in the life cycle of a product. [6] 8. Marketing Management January-2004 [20] 1. Give brief (one or two sentence) answers to the following questions: f) What are different 'P's of marketing? [2] 5. a) Explain the term marketing. Also distinguish between marketing and selli ng. [5] b) 'Marketing research is the milestone of marketing strategy.' Discuss. [6] c) Distinguish between advertising and sales promotion. On what basis you s uggest the build up of advertising budget. [7] July-2004 [20] 1. Give very brief (2-3 lines) answers to the following questions: h) Explain "Ps" of Marketing. [2] 2. a) Define marketing and differentiate it from selling. [4] b) What is marketing mix? [4] c) Define the term price. Explain various methods of pricing. [10] January-2005 [0] July-2005 [6] 4. b) What are the pricing strategies a firm can adopt to respond to a price c ut initiated by a competitor? [6] January-2006 2. a) What involved in [9] 4. a) What [7] [16] is meaning and scope of marketing research? What are the main steps marketing research? Discuss. are the functions performed by distribution channels.

July-2006[4] 2. c) What are the benefits and limitations of interactive marketing for a bus iness? [4] January-2007 [4] 1.

f)

What are the applications of Marketing Management? [4]

July-2007 [6] 2. c) What is Marketing Management? List the main tasks of marketing managemen t in 21st Century. [6] January-2008 [0] 9. Financial Management January-2004 [22] 1. Give brief (one or two sentence) answers to the following questions: g) Define Break-even analysis. [2] Ans: Break-even analysis is a technique widely used by production management and management accountants. It is based on categorising production costs between th ose which are "variable" (costs that change when the production output changes) and those that are "fixed" (costs not directly related to the volume of producti on). Total variable and fixed costs are compared with sales revenue in order to deter mine the level of sales volume, sales value or production at which the business makes neither a profit nor a loss (the "break-even point").

h) pany? Ans: 1. 2. 3. 4.

What are the main decisions that are taken by a finance manager in a com [2] The main decision that are taken by a finance manager in a company are: Investment Decision. Financial Decision. Dividend Decision. Capital Budgeting Decision.

4. a) What factors should be taken into account for determining the capital st ructure of a company? [6] Ans: Capital budgeting (or investment appraisal) is the planning process used to determine whether a firm's long term investments such as new machinery, repl acement machinery, new plants, new products, and research development projects a re worth pursuing. It is budget for major capital, or investment, expenditures. Factors: One is the firm's business riskthe risk pertaining to the line of business in whi ch the company is involved. Firms in risky industries, such as high technology, have lower optimal debt levels than other firms Another factor in determining capital structure involves a firm's tax position. Since the interest paid on debt is tax deductible, using debt tends to be more a dvantageous for companies that are subject to a high tax rate and are not able t o shelter much of their income from taxation. A third important factor is a firm's financial flexibility, or its ability to ra ise capital under less than ideal conditions. Companies that are able to maintai n a strong balance sheet will generally be able to obtain funds under more reaso nable terms than other companies during an economic downturn. Managerial attitude (conservatism or aggressiveness)some financial managers are m

ore conservative than others when it comes to using debt, thus they are inclined to use less debt, all else equal.

b) [6]

Discuss the following as a tool for investment decisions:

i) Payback Period Ans: Payback period in business and economics refers to the period of time re quired for the return on an investment to "repay" the sum of the original invest ment. For example, a $1000 investment which returned $500 per year would have a two year payback period. It intuitively measures how long something takes to "pa y for itself." Shorter payback periods are obviously preferable to longer paybac k periods (all else being equal). ii) NPV. Ans: Net present value (NPV) or net present worth (NPW)[1] is defined as the tot al present value (PV) of a time series of cash flows. It is a standard method fo r using the time value of money to appraise long-term projects. Used for capital budgeting, and widely throughout economics, it measures the excess or shortfall of cash flows, in present value terms, once financing charges are met. iii) IRR. Ans: The internal rate of return on an investment or potential investme nt is the annualized effective compounded return rate that can be earned on the invested capital. In more familiar terms, the IRR of an investment is the interest rate at which t he costs of the investment lead to the benefits of the investment. This means th at all gains from the investment are inherent to the time value of money and tha t the investment has a zero net present value at this interest rate.

c) What is the difference between Gross Working Capital and Net Working Cap ital? State the sources of financing working capital requirement of a company. [6] Ans: Gross Working Capital Net Working Capital 1. Cash and short-term assets expected to be converted to cash within a year 2. Businesses use the calculation of gross working capital to measure cash flow 3. Include Current Assets and current liabilities 4. Gross working capital is sum of current assets of a company 1. , is a financ ial metric which represents operating liquidity available to a business 2. It Does Not. 3. Along with fixed assets such as plant and equipment, working capital is consi dered a part of operating capital. 4. Net working capital is difference of Current assets and current liabilities. There are to type of finance for business------1.) Seed Capital: This is the money required to turn the business idea or concep t into an operating business. The capital may be used to produce a sample run of our product, for initial marketing or premises or even to actively lunch the co mpany. 2.) Operational Capital: Once we have set up our business, we may need t have an investment of operating capital to cover expenditure until such point as revenu

e can generate a profit and subsequent cash surplus. The term of this cash requi rement will depend on our business and its success in the market. Source of financing working capital requirement of a company area) Banks:- Many banks will offer start-up business loans to companies that perceive as relatively low risk and that have assets against which a loan can be secured. b) Friends and family: Money can be borrow from friends and family can be c heap source of capital, there are personal relationships risks if the business v enture doesnt go according to plan. c) Business angels: while usually a high net worth individual, business ang els can sometimes from a consortium for lending to, or investing in small compan ies. This can be a beneficial option as business angels often expect to invest t heir time and experience as well as their money. d) Government grant: The government promotes small business. They encourage small business with financial and information based support. e) Reduce operating cost: a merger of companies will often be motivated by the potential of economies of scale which enable the company to buy for less, a s it will generally be buying more units. f) Growth through acquisition: An acquisition could also be made of a compa ny which offers a complementary product or a supplier , thus growing the company while providing cost-saving benefits.

July-2004 [20] 1. Give very brief (2-3 lines) answers to the following questions: i) Define Break Even Analysis. [2] 3. a) Discuss the broad areas and objectives of Financial Management. [4] Ans: Objective of financial management are: meet day-to-day cash flow needs; pay wages and salaries when they fall due; pay creditors to ensure continued supplies of goods and services; pay government taxation and providers of capital dividends; and ensure the long term survival of the business entity.

b) Discuss the factors, which determine fixed capital and working capital o f a company. [6] Ans: The factors that determine the fixed capital are: a. ess. Nature of business: it determines the amount of fixed capital in a busin in public enterprises such as railways concerns also need sizeable amount of need less fixed capital. They require assets.

b. Huge fixed investment is required , electricity; sewerage etc manufacturing fixed capital trading and financial firms more working capital to invest in current

c. Size of business: capital required by a business depends upon its size. Generally the large size of business, the greater is the need of fixed capital a nd vice versa. d. Type of business: if an industry requires automatic machines and uses mo dern techniques of production, it calls for the larger investment in fixed asset s.

e. Non current assets: investment in non current assets, like goodwill, patent, copy right, long term investment etc are a part of fixed capital and influence the fixed capital of a business. Factors determining working capital are: a. Nature and Volume of Business: The nature and volume of business is an i mportant factor in deciding the amount of working capital. b. Length of Manufacturing Cycle: The time that elapses from the purchase a nd use of raw materials to the production of finished goods is called manufactur ing cycle. The longer the period a manufacturing cycle takes, the larger is the amount of working capital required, because the funds get locked up in productio n process for a longer period of time. c. Business Fluctuations: Business fluctuations are of two types: seasonal fluctuations which arise out of seasonal changes in demand for the product and c yclical fluctuations which occur due to ups and downs of economic activities in the country as a whole. d. Production Policy: The production policy of business is also an importan t determinant of working capital requirement. e. Credit Policy: In the present-day circumstances, almost all units have t o sell goods on credit. The nature of credit policy is an important consideratio n in deciding the amount of working capital requirement.

c)

Describe the methods for investment decision by an enterprise. [8] Ans: The methods of investment decision are:-Pay Back Method Net Present Value Internal Rate of Return January-2005 [16] 1. b) Define the following: i) IRR [1] 3. a) Every manager in an organisation is supposed to take some decisions and so is the finance manager. Discuss what the main decisions taken by a finance ma nager in an organisation and also; the objective followed by him while taking th ese decisions. [10] Ans : The main decision taken by finance manager are:a)Investment decision:- Investment decisions are made by investors and i nvestment managers. Investors commonly perform investment analysis by making use of fundamental analysis, technical analysis and gut feel. Investment decisions are often supported by decision tools. The portfolio theory is often applied to help the investor achieve a satisfactory return compared to the risk taken. Objectives are : a) Non-financial benefits b) Financial Returns c) Ability to Attract Funds in future b.Financial Decision:- It is the decision that is taken by manager which include when and how to invest the fund in a project effectively.

Objectives are:(1) determining the proper amount of funds to employ in a firm; (2) selecting projects and capital expenditure analysis; (3) raising funds on the most favorable terms possible; (4) managing working capital such as inventory and accounts receivable. c. Dividend Decision: The Dividend Decision, in Corporate finance, is a decision made by the directors of a company. It relates to the amount and timing of any cash payments made to the company's stockholders. The decision is an important o ne for the firm as it may influence its capital structure and stock price. In ad dition, the decision may determine the amount of taxation that stockholders pay. There are three main factors that may influence a firm's dividend decision: Free-cash flow Dividend clienteles Information signalling

b) Why should a firm carry Working Capital though such a capital do not ear n a high rate of return? Also, state, the difference between Net Working Capital and Gross Working Capital. [5] July-2005 [10] 5. a) List and explain the factors, which influence the working capital needs of a firm. [10] Ans: Factors are --------(1) Nature and Volume of Business: The nature and volume of business is an important factor in deciding the amount of working capital. For example, the amount of working capital is generally more in trading concerns and in service u nits as compared to the manufacturing units. The retail trading units have also to invest large funds in working capital. In some manufacturing units also, the working capital holds a significant place. On the other hand, public utilities r equire less working capital. Other manufacturing units need more working capital as compared to public utilities. The relation between the volume of business and the requirement of working capit al is more direct and clear. The bigger the size of the units, the more will be the requirement of working capital. (2) Length of Manufacturing Cycle: The time that elapses from the purchase and u se of raw materials to the production of finished goods is called manufacturing cycle. The longer the period a manufacturing cycle takes, the larger is the amou nt of working capital required, because the funds get locked up in production pr ocess for a longer period of time. It is in view of this that, when alternative methods of production are available , the method with the shortest manufacturing cycle should be chosen (assuming ot her factors to be equal). Once a choice is made, care is taken to see that the m anufacturing cycle is completed within a specified period. Any delay in producti on is bound to increase the requirement of working capital. (3) Business Fluctuations: Business fluctuations are of two types: seasonal fluc tuations which arise out of seasonal changes in demand for the product and cycli

cal fluctuations which occur due to ups and downs of economic activities in the country as a whole. If demand for the product is seasonal, production will have to be increased duri ng the season, and it will have to be reduced during the off-season. Correspondi ngly, there will be fluctuations in the requirement of working capital. The busi ness unit will have to face some other problems in addition to this one. It has to bear extra expenses to increase production when product demand increases. It has to bear, costs even to maintain work force and physical facilities during sl ack season. For this reason, many units prefer to continue production even durin g slack season and increase the level of their inventories. The cyclical fluctuations are made up of periods of prosperity and depression. T he sales and prices increase during prosperity necessitating more working capita l in the form of inventories and book-debts. If new investment is made in fixed capital to meet additional demand for the product, then also there will be an in crease in working capital requirement. Generally, business units adopt the polic y to borrow funds on a large scale to increase investment in working capital. As against this, the requirement of working capital gets reduced during depression and therefore they adopt the policy of reducing their short term debts. (4) Production Policy: The production policy of business is also an important de terminant of working capital requirement. If the policy of Constant Production i s adopted, there are two possible effects. If demand for the product is regular and constant, this policy helps in reducing working capital requirement to the l owest possible level. But if demand for the product is seasonal, this policy rai ses the level of inventory during off season and thereby increases the working c apital requirement. If the cost of maintaining inventory is considerably high, t he policy of varying production according to demand is preferred. If the unit pr oduces varied products, it can reduce the requirement of working capital by adju sting the structure of production to the changes in demand. (5) Credit Policy: In the present-day circumstances, almost all units have to se ll goods on credit. The nature of credit policy is an important consideration in deciding the amount of working capital requirement. The larger the volume of cr edit sales, the greater will be the requirement of working capital. Also, the lo nger the period the collection of payment takes, the greater will be the require ment of working capital. Generally, the credit policy of an individual firm depends on the norms of the i ndustry to which the firm belongs. Yet it is possible to pursue different credit policies for different customers in accordance with their creditworthiness. To ignore creditworthiness of the individual customers can be dangerous to the firm . In addition, it is necessary that the firm should be prompt in collection of p ayments. Any slackness in this respect will increase the requirement of working capital and will increase the chance of bad debts. January-2006 [14] 1. d) Investment decisions are irreversible in nature and hence, more risky. Dis cuss. [4] 2. b)

Describe various capital budgeting techniques. [5] Ans: Many formal methods are used in capital budgeting, including the techniqu es such as Net present value: Each potential project's value should be estimated using a di scounted cash flow (DCF) valuation, to find its net present value (NPV). This va luation requires estimating the size and timing of all of the incremental cash f lows from the project. Profitability index: The internal rate of return (IRR) is defined as the discoun

t rate that gives a net present value (NPV) of zero. It is a commonly used measu re of investment efficiency Internal rate of return: The equivalent annuity method expresses the NPV as an a nnualized cash flow by dividing it by the present value of the annuity factor. I t is often used when assessing only the costs of specific projects that have the same cash inflows Modified Internal Rate of Return: Real options analysis try to value the choices - the option value - that the managers will have in the future and adds these v alues to the NPV Equivalent annuity: The real value of capital budgeting is to rank projects. Mos t organizations have many projects that could potentially be financially rewardi ng

3. c) Balance Sheet records stock of assets and liabilities while Profit and Lo ss Account records flows of income and expenses. In the light of this statement, distinguish balance sheet from Profit and Loss account. [5] July-2006[18] 5. a) Compare NPV (Net Present Value) and IRR (Internal Rate of Return) method s of Investment decisions. Which one of the two, you find to be more rational an d why? [9] Ans: IRR is directly linked with the NPV rate and their relation may be summa rized as: 1) When the IRR = the firms hurdle rate, NPV = 0 2) When the IRR < the firms hurdle rate, NPV < 0 3) When the IRR > the firms hurdle rate, NPV > 0 d When using the IRR and NVP rates: mutually exclusive projects are always ranked the same direct estimates of the increase or decrease in shareholder value can be obtaine the time value of money is taken into account accounting measures of profit are considered Possible decision conflicts among NPV and IRR A ranking conflict occurs when one project has a higher NPV than another while the lower NPV project has a higher IRR. Ranking conflicts are unusual but can occur. These conflicts are relevant only when there are multiple acceptable mutually exclusive projects. Compare and contrast The internal rate of return (IRR) and the net present value (NPV) techni ques are 2 investment decision tools that satisfy the 2 major criteria for the c orrect evaluation of capital projects. This criterion is that the techniques sho uld incorporate the use of cash flows and the use of the time value of money. Th is makes them viable techniques for evaluating investment proposals. The Net Present Value is one of the techniques that are used by firms when evalu ating which investment proposals to take on board and which ones to reject. The

net present value is calculated by discounting all flows to the present and subt racting the present value of all inflows. IRR is usually more effective in determining whether a single project is worth i nvesting in rather than comparing 2 mutually exclusive projects to determine whi ch is better for investment. In conclusion, both the NPV and IRR techniques are important tools in the decisi on making process in determining which projects a firm should invest in and whic h ones they should reject. They give the analyst an idea of the future earning p otential of projects and as such make investment decisions easier. Whether the t echniques are used together or separately will depend on the nature of the

b) Why do firms need working capital? What are the main components of worki ng capital management? [9] Ans: Needs of working capital: The working capital need can be separated into t wo parts: A fixed part: The fixed part is probably defined in amount as the minimum workin g capital requirement for the year. A fluctuating : the fluctuating element should be financed from a short-term sou rce (e.g. a bank overdraft), which can be drawn on and repaid easily and at shor t notice. Working capital is used to pay short-term obligations such as our accounts payab le and buying inventory. If our working capital dips too low, ou risk running ou t of cash. Even very profitable businesses can run into trouble if they lose the ability to meet their short-term obligations.

Component of working capital are: a) Cash: The three motives for holding cash balances are Transactions motive to conduct day-to-day business of paying for purchases, labo r, etc. Precautionary motive to cover unexpected expenditures. If the delivery truck br eaks down, it must be repaired or replaced if you want to stay in business. Speculative motive unusually good opportunities occasionally arise. If you have the money available, you can take advantage of these opportunities b) Marketable Securities: Marketable securities are a way of holding cash but with the attribute of earnin g interest. Market securities have three characteristics: 1. 2. 3. Short-term maturity (less than one year, or money market instruments High marketability Virtually no risk of default

c) Accounts Receivable: Accounts receivable are generated when a firm offers credit to its customers. T he first thing that needs to be addressed when establishing a credit policy is t o set the standards by which a firm is judged in determining whether or not cred it will be extended. There is whats known as the 5 Cs of credit: 1. Character the willingness of the borrower to repay the obligation

2. Capacity the capability of the borrower to earn the money to repay the o bligation 3. Capital sufficient assets available to support operations (as opposed to a firm that is undercapitalized). Sometimes capital is interpreted to mean equ ity capital; i.e., to make sure the owners of the firm have sufficient money at stake to give them proper incentive to repay the loan and not let the company g o bankrupt. 4. Collateral assets to support the loan which can be liquidated if default occurs 5. Conditions current and future anticipated conditions of the firm and the industry. d) Inventories: Inventories (raw materials, work-in-process, finished goods) make up a large por tion of most firms current assets, and for many, total assets. As such, the exte nt to which a firm efficiently manages its inventories can have a large influenc e on its profitability. Thus, keeping abreast of inventory policy is critical t o the profitability (and value) of the firm. Inventory costs can be broken down into three major categories: A. 1. 2. 3. B. 1. 2. 3. 4. 5. C. 1. 2. 3. Ordering Costs Fixed costs stocking, clerical Shipping costs often fixed Missed quantity discounts an opportunity cost Carrying Costs Time value of money tied-up in inventories Warehousing costs Insurance Handling Obsolescence, breakage, shrinkage Stock-out Costs Lost sales Loss of goodwill Special shipping costs

January-2007 [9] 2. b) Explain the functions of Financial Management and its applications. [9] Ans: Functions of financial management is to study and implement (1) Investment decision (2) Financing decision and (3) Dividend decision. Application of Financial Management: 1. Planning

2. 3. 4. 5. 6. 7. 8. 9.

Budgeting financial reporting internal controls evaluation monitoring Decision taking Controlling investment Calculating net income Maintain salary among employees

July-2007 [9] 3. a) Explain the main components of Working Capital. What is importance of work ing capital management? [9] Ans: Working capital, also known as net working capital, is a financial metric which represents operating liquidity available to a business. Along with fixed a ssets such as plant and equipment, working capital is considered a part of opera ting capital. It is calculated as current assets minus current liabilities. If c urrent assets are less than current liabilities, an entity has a working capital deficiency, also called a working capital deficit. Importance of working capital management are: 1. They convert the Current Assets into cash 2. They help in case settlement 3. They report the companys balance sheet. 4. Working capital management is to maintain the optimum balance of each of the working capital components. 5. They look after the deposit in banks. 6. They look after the investment.

January-2008 [12] 5. b) Describe various capital budgeting techniques. [6] 7. c) What is the importance of working capital management in an organization? [6]

10. Human Resources Management January-2004 [0] July-2004 [2] 1. Give very brief (2-3 lines) answers to the following questions: j) What is HRIS? [2] Ans: The Human Resource Information System (HRIS) is a software or online solut ion for the data entry, data tracking, and data information needs of the Human R esources, payroll, management, and accounting functions within a business. Norma lly packaged as a data base, hundreds of companies sell some form of HRIS and ev ery HRIS has different capabilities. January-2005 [0] July-2005 [12] 1. d) What are the objectives of Employees Performance Appraisal? [4] Ans: Performance appraisal, also known as employee appraisal, is a method by whi ch the performance of an employee is evaluated. Performance appraisal is a part of career development. Performance appraisals are a regular review of employee performance within organizations. Generally, the aims of a scheme are: Give feedback on performance to employees. Identify employee training needs. Document criteria used to allocate organizational rewards. Form a basis for personnel decisions: salary increases, promotions, disciplinary actions, etc. Provide the opportunity for organizational diagnosis and development. Facilitate communication between employee and administrator.

 Validate selection techniques and human resource policies to meet federal Equal Employment Opportunity requirements.

5. b)

What is Human Resource Planning? [4] Ans: Human resource planning is the pattern of planned human resource deploymen ts and activities intended to enable the organization to achieve its goals. HRP therefore falls into the wider area of employee resourcing (planning for, acquir ing and allocating the desired human resources for the organisation). Employee r esourcing is an arm of the HR function. HRP entails knowing in advance what the staffing needs of the organisation will be, assessing the supply of the relevant workers in the organisation and labour market, and finding ways to fulfil the s taffing needs of the organisation. Organisations are greatly affected by their d emand for labour, and therefore by the supply of labour.

c)

What are the important steps in Human Resource Planning? [4]

Ans: The important steps of HRP are: 1. 2. needs 3. ), and affing 4. Deciding on strategic plans and resultant design of the organization. Out of these strategic plans, determining the organizations labour demand for both the short & longer terms. Assessing the labour supply situation (both internal and external supply in light of it to draw up plans for effectively & continuously filling st needs. Implementing the staffing plans.

January-2006 [7] 3. a) Discuss concepts and perspective of human resource management. [7] Ans: Human resource management (HRM) is the strategic and coherent approach to the management of an organization's most valued assets - the people working ther e who individually and collectively contribute to the achievement of the objecti ves of the business. In simple sense, HRM means employing people, developing the ir resources, utilizing, maintaining and compensating their services in tune wit h the job and organizational requirement. Its features include: Organizational management Personnel administration Manpower management Industrial management

Perspective of HRM: In many ways, critically or not, many writers contend that HRM itself is an atte

mpt to move away from the modernist traditions of personnel (man as machine) tow ards a postmodernist view of HRM (man as individuals). Critiques include the not ion that because 'Human' is the subject we should recognize that people are comp lex and that it is only through various discourses that we understand the world. Man is not Machine, no matter what attempts are made to change it. Many critics note the move away from Man as Machine is often in many ways, more a Linguistic (discursive) move away than a real attempt to recognise the Human i n Human Resource Management. Critical Theory, in particular postmodernism (poststructualism), recognises that because the subject is people in the workplace, the subject is a complex one, a nd therefore simplistic notions of 'the best way' or a unitary perspectives on t he subject are too simplistic. It also considers the complex subject of power, p ower games, and office politics. Power in the workplace is a vast and complex su bject that cannot be easily defined. This leaves many critics to suggest that Ma nagement 'Gurus', consultants, 'best practice' and HR models are often overly si mplistic, but in order to sell an idea, they are simplified, and often lead Mana gement as a whole to fall into the trap of oversimplifying the relationship. July-2006[4] 1. f) Discuss Employees Stock Option Plan as an incentive scheme for employees . [4] Ans: Many companies use employee stock options plans to compensate, retain, and attract employees. These plans are contracts between a company and its employees that give employees the right to buy a specific number of the companys shares at a fixed price within a certain period of time. Employees who are granted stock options hope to profit by exercising their options at a higher price than when t hey were granted. Various steps taken are: Step 1: Get the 'big picture' Step 2: Develop a Mission Statement or Statement of Intent Step 3: Conduct a SWOT analysis of the organization Step 4: Conduct a detailed human resources analysis Step 5: Determine critical people issues Step 6: Develop consequences and solutions Step 7: Implementation and evaluation of the action plans

January-2007 [18] 4. b) Discuss concepts and perspective of human resource management. [9] 6. b) What is Primary Compensation? Explain the requisites of a sound primary compensation structure? Discuss. [9] July-2007 [18] 3. b) What is performance appraisal? Discuss the essential of a sound performa nce appraisal system. [9] Ans: The essential of a sound performance appraisal system are: a. Performance appraisal is a key to higher productivity, overall effective ness and employee development. b. Performance appraisals work best when the top executive.

c. Identify employee training needs d. Form a basis for personnel decisions: salary increases, promotions, disc iplinary actions, etc e. Provide the opportunity for organizational diagnosis and development f. Facilitate communication between employee and administrator g. Validate selection techniques and human resource policies to meet federa l Equal Employment Opportunity requirements. h. Give feedback on performance to employees

5. a) What is Human Resource Planning? What is its importance in Human Resourc e Management? [9] Ans: Importance of human resource management: a. HRM is the legal liason between the organization and the employees,they are to uphold the employment and safety laws (osha, and civil rights act) as wel l as follow the practices, which may differ within federal guidelines, that the employer authorizes. b. Helps the Corporations to searching for better ways to produce goods and services. c. Helps in improving and implementing new technology. d. HRM is required to maintain a strong partnership between management and labor unions. e. To achieve these goals of company, the company needs a talented HR depar tment. f. To be successful in the automotive market, these companies needs a highl y skilled, flexible and committed work force, a flexible and innovative manageme nt for which HRM required. g. For the growth of Human Resources department, companies require talented people with the knowledge. For hiring this people a good HRM is required. h. To bring up new technology and increase the efficiency of company a good HRM is required. i. For the safeguard of employee HRM is required.

January-2008 [6] 5. a) Discuss the concepts and perspective of human resource management. [6]

11. Information Systems, Organization, Management & Strategy 1. Show by diagram only flow of information in an organization. [2] Ans:

2. Differentiate between software and hardware requirement for an efficient information system. [2] Ans: Software requirement includes the required program, instructions, procedur e and documentations of computer system that is use to achieve the goal of an ef ficient information system. Hardware requirement includes the physical component like CD, printer etc which are required by an efficient information system to carry out their work. 3. What is knowledge management system? [2] Ans: Knowledge Management System (KM System) refers to a (generally IT based ) system for managing knowledge in organizations for supporting creation, captur e, storage and dissemination of information. It can comprise a part (neither nec essary or sufficient) of a Knowledge Management initiative. A KM system could be any of the following: 1. Document based. 2. Ontology/Taxonomy based 3. Based on AI technologies 4. Provide network maps 5. Increasingly social computing tools KMS systems deal with information so they are a class of information system and may build on, or utilize other information sources. 4. Define decision support system and how it is different from expert system? [7]

Ans: A Decision Support Systems (DSS) is a class of information systems (includi ng but not limited to computerized systems) that support business and organizati onal decision-making activities. A properly designed DSS is an interactive softw are-based system intended to help decision makers compile useful information fro m a combination of raw data, documents, personal knowledge, or business models t o identify and solve problems and make decisions. Typical information that a decision support application might gather and present are: an inventory of all of your current information assets (including legacy and rel ational data sources, cubes, data warehouses, and data marts), comparative sales figures between one week and the next, projected revenue figures based on new product sales assumptions; DSS VS EXPERT SYSTEM DSS aid in problem solving by allowing for manipulation of data & models whereas ES allow experts to 'teach' computers about their field so that the system may s upport more of the decision making process for less expert decision makers. DSS most often contain equations that the system uses to solve problems or updat e reports immediately, and the users makes the final decisions on the basis of t he information whereas an expert system works from a much larger set of modeling rules,uses concepts from AI to process and store the knowledge base & scans bas e to suggest a final decision decision through inference. DSS only supports the decision making process & a human user is required to weigh all the factors in making a decision whereas ES must acquire knowledge from an expert and apply a large but standard set of probability based rules to make a d ecision in a specific problem setting.

5. What is spreadsheet? How is it useful for a manager in decision making? Support your answer with suitable examples. [6] Ans: A spreadsheet is a computer application that simulates a paper worksheet. It displays multiple cells that together make up a grid consisting of rows and c olumns, each cell containing either alphanumeric text or numeric values. A sprea dsheet cell may alternatively contain a formula that defines how the contents of that cell is to be calculated from the contents of any other cell (or combinati on of cells) each time any cell is updated. Spreadsheets are frequently used for financial information because of their ability to re-calculate the entire sheet automatically after a change to a single cell is made. The uses of spreadsheet to manager to make decision are as follows: a. Accountants need to keep track of all of the money coming into the busin ess and all of the payments going out. b. They need to be able to calculate profits and forecast how well they thi nk the business will do during the next year. c. They also need to calculate the wages of all the staff each month. d. Sales people use spreadsheets to keep track of the items they sell, the value of the items, the profit made on each item and more importantly, the commi ssion they have earned! e. They use spreadsheets to help them to analyze what happened with the exp eriment and also to predict what might happen if they were to change one variabl e. f. Supermarkets use spreadsheets to keep track of finances i.e. sales, loss es and money spent. g. Market researchers collect data from shoppers about their spending habit s and their awareness of different brands. All of this data has to be collated a nd analyzed in order to provide the company with a detailed report of what custo mers think about their products.

6. Ans:

Differentiate between data, information and knowledge.

[5]

Data Information Knowledge a. Data are groups of information that represent the qualitative or quantitative attributes of a variable or set of variables. b. Data are often viewed as the lowest level of abstraction from which informati on and knowledge are derived. c. Data is/are the facts of the World.

d. Data... data is raw

e. Data: symbols a. Information is closely related to notions of data, kn owledge, instruction etc.

b. It is not.

c. Information allows us to expand our knowledge beyond the range of our senses d. Information is data that has been given meaning by way of relational connecti on. e. Information: data that are processed to be useful; provides answers to "who", "what", "where", and "when" questions a. Knowledge is defined as expertise, an d skills acquired by a person through experience or education; the theoretical o r practical understanding of a subject b. It is not.

c. Knowledge is the outcome of information.

d. knowledge is the appropriate collection of information e. Knowledge: application of data and information; answers "how" questions 7. What is Transaction Processing System? [2] Ans: A Transaction Processing System or Transaction Processing Monitor is a s et of information which process the data transaction in database system that mon itors transaction programs (a special kind of program). The essence of a transac tion program is that it manages data that must be left in a consistent state. E. g. if an electronic payment is made, the amount must be either both withdrawn fr om one account and added to the other, or none at all. In case of a failure prev enting transaction completion, the partially executed transaction must be 'rolle d back' by the TPS. 8 Differentiate between MIS and DSS. [6] ans :-- MIS and DSS are two abbreviations that are often heard in the field of Business Management. They differ in a few aspects. It is important to know that MIS stands for Management Information Systems whereas DSS stands for Decision Su pport Systems. It is interesting to note that MIS is a type of link that assists in the communi cation between managers of various disciplines in a business firm or an organiza tion. On the whole it plays a very important role in building up communication a mong the corporate people. DSS on the other hand is an improvement of the concept of MIS. It is true that b oth of them differ in terms of their focus. DSS focuses more on leadership. It i s all about senior management in a firm providing innovative vision. On the other hand MIS focuses more on the information gathered and the informati on that has poured from different quarters. Experts on managerial behavior say t hat DSS focuses more on decision making. MIS on the other hand focuses more on p lanning the report of various topics concerned with the organization that would assist the managers to take vital decisions pertaining to the functioning of the organization. One of the finest differences between MIS and DSS is that MIS focuses on operati onal efficiency whereas DSS focuses more on making effective decision or in othe r words helping the company to do the right thing. Flow of information is from b oth sides, up and down in the case of MIS. On the other flow of information is o nly upward in the case of DSS. In the case of DSS the report can be flexible whereas in the case of MIS the rep ort is usually not flexible. MIS is characterized by an input of large volume of data, an output of summary reports and process characterized by a simple model. On the other hand DSS is featured by an input of low volume of data, an output of decision analysis and a process characterized by interactive model. Experts would also say that MIS is a primary level of decision making whereas DS S is the ultimate and the main part of the decision. This is one of the most tal ked about different between the two. As a matter of fact MIS is all about theory whereas DSS is all about practice an d analysis. An organization should employ both the systems effectively. 9. State the role of an expert system in business decision-making. [2] Ans: An expert system is software that attempts to provide an answer to a proble m, or clarify uncertainties where normally one or more human experts would need to be consulted. Expert systems are most common in a specific problem domain, an d is a traditional application and/or subfield of artificial intelligence. A wid e variety of methods can be used to simulate the performance of the expert howev er common to most or all are 1) the creation of a so-called "knowledgebase" whic h uses some knowledge representation formalism to capture the Subject Matter Exp

ert's (SME) knowledge and 2) a process of gathering that knowledge from the SME and codifying it according to the formalism, which is called knowledge engineeri ng.

10. List and explain the six major types of information systems in organization. Who are the users of each of these six systems? [10] Ans : Six major types of information system are: Executive Support Systems (ESS) : An Executive Support System ("ESS") is designe d to help senior management make strategic decisions. It gathers, analyses and s ummarises the key internal and external information used in the business. A good way to think about an ESS is to imagine the senior management team in an aircra ft cockpit - with the instrument panel showing them the status of all the key bu siness activities. ESS typically involve lots of data analysis and modelling too ls such as "what-if" analysis to help strategic decision-making. Decision Support Systems (DSS) : Decision-support systems ("DSS") are specifical ly designed to help management make decisions in situations where there is uncer tainty about the possible outcomes of those decisions. DSS comprise tools and te chniques to help gather relevant information and analyse the options and alterna tives. DSS often involves use of complex spreadsheet and databases to create "wh at-if" models. Management Information Systems (MIS) : A management information system ("MIS") i s mainly concerned with internal sources of information. MIS usually take data f rom the transaction processing systems (see below) and summarise it into a serie s of management reports.MIS reports tend to be used by middle management and ope rational supervisors. Transaction Processing Systems (TPS) : As the name implies, Transaction Processi ng Systems ("TPS") are designed to process routine transactions efficiently and accurately. A business will have several (sometimes many) TPS; for example: - Billing systems to send invoices to customers - Systems to calculate the weekly and monthly payroll and tax payments - Production and purchasing systems to calculate raw material requirements - Stock control systems to process all movements into, within and out of the bus iness Knowledge Management Systems : Knowledge Management Systems ("KMS") exist to hel p businesses create and share information. These are typically used in a busines s where employees create new knowledge and expertise - which can then be shared by other people in the organisation to create further commercial opportunities. Good examples include firms of lawyers, accountants and management consultants.K MS are built around systems which allow efficient categorisation and distributio n of knowledge. For example, the knowledge itself might be contained in word pro cessing documents, spreadsheets, PowerPoint presentations. internet pages or wha tever. To share the knowledge, a KMS would use group collaboration systems such as an intranet. Office Automation Systems: Office Automation Systems are systems that try to imp rove the productivity of employees who need to process data and information. Per haps the best example is the wide range of software systems that exist to improv e the productivity of employees working in an office (e.g. Microsoft Office XP) or systems that allow employees to work from home or whilst on the move. January-2006 [30] 4. b) How can information system support strategies at the firm level? [5]

d) Specify any two informational needs of a finance manager that can be sat isfied through a suitable information system. [2] Ans: 1) ACCESSING RELIABLE, ACCURATE DATA 2) REDUCING HR DEPARTMENT AND WORKFORCE COSTS

What is information? What is the need of information? What is informatio n technology? Discuss properties and scope of information. [10] Ans: Data that (1) has been verified to be accurate and timely, (2) is speci fic and organized for a purpose, (3) is presented within a context that gives it meaning and relevance, and (4) that can lead to an increase in understanding an d decrease in uncertainty. The value of information lies solely in its ability to affect a behavior, decisi on, or outcome. A piece of information is considered valueless if, after receivi ng it, things remain unchanged. For a technical definition of information see in formation theory. Information is the lifeblood of any organization. Damaged or lost data can cause disruptions in normal business activities leading to financial losses, law suit s, etc. Information systems, which comprise hardware, software, data, applicatio ns, communication and people, help an organization to better manage and secure i ts critical corporate, customer and employee data. Information systems also impr ove integration and work processes...the benefits go on and on. Answer An information system is also a system but differs from other kinds of systems b ecause its objective is to monitor and document the operations of other systems, which we can call target systems. An information system owes its existence to t he target system. For example, production activities would be the target system for a production scheduling information system, human resources would be the tar get system of a human resource information system, and so on. We could say that every reactive system may have a subsystem that can be considered as an informat ion system whose objective is to monitor and control such a system. The main fun ctions of an information system may be input, processing, output, storage and co ntrol at work place Properties of information technology are: a. Reliable b. Faster c. Accurate d. Secure e. Store lager amount of data f. Data management g. Computation Scope of information technology includes: a. Make the information available everywhere. b. Provide faster transformation of information. c. Reduce the cost of transformation. d. Reduce the time consuming. e. Provide accurate information for decision making. a) Discus briefly Technical Approach, Behavioural Approach and Socio-Techni cal Approach to information systems. [9] a) Define Management Information System (MIS). What are the pre-requisites of an effective MIS? [10]

Ans: Management Information System (M.I.S.) is basically concerned with processing da ta into information which is then communicated to the various Departments in an organization for appropriate decision-making. Data Information Communication Decisions An MIS should be designed to achieve the following goals: Enhance communication among employees. Deliver complex material throughout the institution. Provide an objective system for recording and aggregating information. Reduce expenses related to labor-intensive manual activities. Support the organization's strategic goals and direction.

The pre-requisites of an effective MIS are: a.) Timeliness : To simplify prompt decision making, an institution's MIS should be capable of providing and distributing current information to appropriate use rs. b.)Accuracy: A sound system of automated and manual internal controls must exist throughout all information systems processing activities. Information should receive appropriate editing, balancing, and internal control checks. A comprehensive internal and external audit program should be employed to ensure the adequacy of internal controls c.) Consistency: To be reliable, data should be processed and compiled consisten tly and uniformly. Variations in how data is collected and reported can distort information and trend analysis. d) Completeness: Decision makers need complete and pertinent information in a su mmarized form. Reports should be designed to eliminate clutter and voluminous de tail, thereby avoiding "information overload." e) Relevance: Information provided to management must be relevant. Information that is inappropriate, unnecessary, or too detailed for effective decision makin g has no value. MIS must be appropriate to support the management level using it . 7. b) Describe the phases of System Development Life cycle. [8]

Ans: Systems Development Life Cycle (SDLC) is any logical process used by a syst ems analyst to develop an information system, including requirements, validation , training, and user ownership. Any SDLC should result in a high quality system that meets or exceeds customer expectations, reaches completion within time and cost estimates, works effectively and efficiently in the current and planned Inf ormation Technology infrastructure, and is inexpensive to maintain and cost-effe ctive to enhance.[2] The steps can be characterized and divided in several steps. These are a)Initiation/planning: To generate a high-level view of the intended project and

determine the goals of the project. The feasibility study is sometimes used to present the project to upper management in an attempt to gain funding. b) Requirements gathering and analysis: The goal of systems analysis is to deter mine where the problem is in an attempt to fix the system. This step involves br eaking down the system in different pieces and drawing diagrams to analyze the s ituation. c) Design : In systems design functions and operations are described in detail, including screen layouts, business rules, process diagrams and other documentati on. The output of this stage will describe the new system as a collection of mod ules or subsystems. d) Build or coding: Modular and subsystem programming code will be accomplished during this stage. Unit testing and module testing are done in this stage by th e developers. This stage is intermingled with the next in that individual module s will need testing before integration to the main project. e) Testing: The code is tested at various levels in software testing. Unit, syst em and user acceptance testing are often performed. f) Operations and maintenance: The deployment of the system includes changes and enhancements before the decommissioning or sunset of the system. Maintaining th e system is an important aspect of SDLC Define expert system. Discuss knowledge-based expert system. Ans : Expert System Component Facts : Rule Based Reasoning Databases Inference Engine Knowledge Base (rule base) Knowledge Engineering Facts Case-Based Reasoning (Method in which to create a Knowledge Base) [9]

Advantages are: Permanence Reproducibility - Many copies of an expert system can be made, Efficiency - can increase throughput and decrease personnel costs Consistency - With expert systems similar transactions handled in the same way. The system will make comparable recommendations for like situations. Documentation - An expert system can provide permanent documentation of the deci sion process Completeness - An expert system can review all the transactions, a human expert can only review a sample. Timeliness - Fraud and/or errors can be prevented. Information is available soon er for decision making. Entry barriers - Expert systems can help a firm create entry barriers for potent ial competitors Differentiation - In some cases, an expert system can differentiate a product or can be related to the focus of the firm Knowledge-Based Systems focuses on systems that use knowledge-based techniques t o support human decision-making, learning and action. Such systems are capable o f cooperating with human users and so the quality of support given and the manne r of its presentation are important issues. The emphasis of the journal is on th e practical significance of such systems in modern computer development and usag

e. An Expert (Knowledge Based) System is a problem solving and decision making syst em based on knowledge of its task and logical rules or procedures for using knowl edge. Both the knowledge and the logic is obtained from the experience of a spec ialist in the area (Business Expert) What is case-based reasoning? How does it differ from an expert system? 6] [

Ans: Case-based reasoning (CBR), broadly construed, is the process of solvin g new problems based on the solutions of similar past problems. An auto mechanic who fixes an engine by recalling another car that exhibited similar symptoms is using case-based reasoning. Case-based reasoning is a prominent kind of analogy making. Case-based reasoning has been formalized for purposes of computer reasoning as a four step process Retrieve: Given a target problem, retrieve cases from memory that are relevant t o solving it. A case consists of a problem, its solution, and, typically, annota tions about how the solution was derived. Reuse: Map the solution from the previous case to the target problem. This may i nvolve adapting the solution as needed to fit the new situation. Revise: Having mapped the previous solution to the target situation, test the ne w solution in the real world (or a simulation) and, if necessary, revise. Retain: After the solution has been successfully adapted to the target problem, store the resulting experience as a new case in memory. 7. a) What is OLTP?

Ans: Online transaction processing, or OLTP, refers to a class of systems that facilitate and manage transaction-oriented applications, typically for data ent ry and retrieval transaction processing. OLTP has also been used to refer to pro cessing in which the system responds immediately to user requests. An automatic teller machine (ATM) for a bank is an example of a commercial transaction proces sing application.

12. Information Systems and Managerial Functional Areas

Identify the four basic data needs of - Personnel Manager, Finance Manag er, Production Manager and Marketing Manager for their respective decision makin g problems. [8] Ans :-- personal manager:-- In large organisations, to maintain contact with the huge number of employees by the management is an impossible task. The task of i dentifying the needs of the employees and making them known to the management to take the necessary action is allotted to the personnel manager. He is responsib le for relaying the information that concerns the general administration related to employee welfare within the entity. A personnel manager might be allotted with the task of identifying the areas whe re there is a need for additional work force. The vacancy might be on account of retirement, promotion, attrition, job rotation, etc. He should keep track of th e retirements and take steps to fill them before the specified dates to avoid br eakage of work. It is also the task of the personnel manager to inform the organ isation about the retirement of an employee in the senior cadre. He might be giv en the job of screening the potential candidates to verify their suitability to the role. The personnel manager is left with the charge of identifying the elements that a re to be incorporated in the company handbook. The employee handbook contains th e company policies and procedures that are to be followed for ensuring the smoot h flow of operations. It has information on the general code of conduct expected from the employees. The personnel manager has to ensure that the employee handb ook contains information on the various causes that can lead to the termination of the work contract. The handbook is also expected to have guidelines for promo tions and demotions to give an insight on the general expectations from an emplo yee. The personnel manager has to make sure that the modifications in the genera l guidelines are informed to the employees as and when they are introduced into the system. For instance, a change in the dress code has to be informed to the e mployees along with the tentative date of initialising the modification. The personnel manager is to oversee into factors related to compensation and wel fare of the employees. For instance, the compensation paid to an employee who me t with an accident varies with the impact it has on the employee fitness. Many c ompanies in India have group welfare schemes wherein a part of the salary is set aside which is utilised to meet the employee emergencies and to help him overco me the inconvenience caused on account of the accident. Modifications must be in corporated after taking into consideration the changes in the general cost of li ving, economic conditions, etc. The personnel manager must be innovative to come up with new welfare schemes which are capable of retaining the employees within the organisation. Besides the welfare schemes, the personnel manager will have to provide emotional support to improve the employee well being. Counselling cen tres are to be introduced to aid the employees overcome their emotional weakness es which might otherwise have a negative impact on their performance. Finance manager:-Production manager :-- A few production managers we surveyed added traffic contro ller to their title parenthetically. The clarification is apt, since their job is not to produce but to make sure that production runs smoothly. Production manag ers are primarily administrators or supervisors; they determine the allocation o f labor resources, track production scheduling and costs, make any on-the-fly ad justments to the process, and coordinate any receiving of raw materials or shipp ing of final goods. A production manager is very busy most days. The job is a lot of coordination. You should be able to juggle a lot of different jobs at the sa me time and deal with any emergencies that come up, explained one. The variety of the work on a day-to-day basis recommends this job to people with strong work e thics, curious minds, and organizational abilities. Many production managers are asked to implement systems of production tracking and quality control, so the f

irst step for product managers is to become intimate with existing systems of pr oduction, past cost estimates, and company policies. Youve got to be careful not t o make recommendations until youve gathered enough information to make intelligen t ones, offered a five-year production manager. Also, production managers need to gain the trust of the people who work for them. If youre not credible, youre not e ffective, said one production manager. A good production manager will also react to situations as they occur. Flexibility is the key to success, as one respondent noted. Priorities, backlogs, breakdowns, strikes-all of these can alter intricat ely planned scheduling, and the production manager has to be flexible enough to adjust to these situations without reducing overall efficiency. Its not unusual f or the production manager to be located on the production floor, in order to see first-hand the running of the production process. But while production managers are involved in each stage of production, few micromanage the day-to-day detail s of each departments work. A production manager spends some time working alone o n reports, but most of his/her time (over 60 percent) is spent meeting with repr esentatives from different levels of the production process. In situations where production facilities are spread over large areas, a production manager spends a significant amount of time on the telephone. Production managers who decide to leave the profession search out challenges tha t excite both the creative and the detailed sides of their personalities. Many b ecome entrepreneurs, efficiency experts, and strategic marketers. Their intimacy with the production process makes a transition to general administrative manage ment easy, but relatively few take this option. It seems that the profession pro vides a challenge that few are in a hurry to forsake. Explain the role played by financial information system in making financ ial decisions. [8] ss. What are the type of decisions and the areas of their involvement? Discu [4]

Explain information requirements of a Personal manager for better decisi on and integration with overall information system with in the organization. [9] January-2008 [0]

13. Current Issues in Information Systems January-2004 [4] 1. Define ERP and CRM.

Ans: Enterprise resource planning (ERP) is a company-wide computer software sys tem used to manage and coordinate all the resources, information, and functions of a business from shared data stores. An ERP system typically has modular hardware and software units and "services" t hat communicate on a local area network. The modular design allows a business to add or reconfigure modules (perhaps from different vendors) while preserving da ta integrity in one shared database that may be centralized or distributed. Customer relationship management (CRM) consists of the processes a company uses to track and organize its contacts with its current and prospective customers. C RM software is used to support these processes; information about customers and customer interactions can be entered, stored and accessed by employees in differ ent company departments. Typical CRM goals are to improve services provided to c ustomers, and to use customer contact information for targeted marketing. 2. Name current challenges for IT management. Ans: The challenges for IT management are: a. Training Demands b. Errors c. New Integration d. Cascading Needs e. Vendor Neglect f. Vendor Oversell g. Acquisition Dilemma h. Support Burden i. data governance j. data quality k. retention management l. complex software

3.

Define E-commerce.

Ans : Electronic Commerce, commonly known as (electronic marketing) e-commerce o r eCommerce, consists of the buying and selling of products or services over ele ctronic systems such as the Internet and other computer networks. The amount of trade conducted electronically has grown extraordinarily with widespread Interne t usage. The use of commerce is conducted in this way, spurring and drawing on i nnovations in electronic funds transfer, supply chain management, Internet marke ting, online transaction processing, electronic data interchange (EDI), inventor y management systems, and automated data collection systems. 4. c) Explain SCM

[9] Ans: Supply chain management (SCM) is the management of a network of interconne cted businesses involved in the ultimate provision of (business)|product and [[S ervice (economics)] packages required by end customers.Supply chain management e ncompasses the planning and management of all activities involved in sourcing, p rocurement, conversion, and logistics management. It also includes the crucial c omponents of coordination and collaboration with channel partners, which can be suppliers, intermediaries, third-party service providers, and customers. In esse nce, supply chain management integrates supply and demand management within and across companies. 6. a) The internetworked enterprise is the best model for the business use of information technology in the present century.' Do you agree or disagree? Give r eason(s) for your answer. [5] c) One, of the concerns of the consumers making online purchases is about t he confidentiality about their credit/debit card information that is vulnerable to interception by network sniffers. You are required to suggest any two-securit y measures, which can take care of this concern of the consumers. [2] Role of E-Commerce in Marketing [3]

Ans: Some common applications related to electronic commerce are the following: Email Enterprise content management Instant messaging Newsgroups Online shopping and order tracking Online banking Online office suites Domestic and international payment systems Shopping cart software Teleconferencing Electronic tickets iv) Application of Artificial Intelligence in Modern Business Organisation [3]

Ans: Artificial Intelligence has been used in a wide range of fields including medical diagnosis, stock trading, robot control, law, scientific discovery and t oys. Role of Artificial Intelligence in different fields are: a) AI researchers have created many tools to solve the most difficult probl ems in computer science. b) Banks use artificial intelligence systems to organize operations, invest in stocks, and manage properties c) Financial institutions have long used artificial neural network systems to detect charges or claims outside of the norm, flagging these for human invest igation. d) A medical clinic can use artificial intelligence systems to organize bed schedules, make a staff rotation, and provide medical information. e) Artificial neural networks are used for medical diagnosis f) Composition, performance, music theory, sound processing are some of the major areas on which research in Music and Artificial Intelligence are focusing on. g) AI are use in building of robots.

h)

In telecommunication field AI plays a great role.

July-2005 [30] 1. g) Briefly explain role of E-Commerce in marketing? Ans :

[4]

E-commerce marketing, internet marketing Now-a-days Internet marketing is the best way to succeed in the online business. E-Commerce marketing along with the advertising systems makes the business to re ach at optimum level.E-commerce makes the marketing easy, faster, efficient and maximum accurate. E-commerce, Web designing and development: Trading on the Internet, credit card payment, and virtual shopping carts are bei ng used by todays generation points to a new direction in commerce (ecommerce). T he ever-increasing ecommerce solutions are serving businesses worldwide at an ex treme extent. Businesses, to compete in today's market, need a dynamic web des igning and development. E-commerce advertising: Ecommerce advertising allows you to place advert for other companies and service s in the site by way of banners or, perhaps text adverts which makes your site m ost popular, increase the business and maximize the profits. E-commerce play vital role in faster economic growth by using the modern technol ogy. It provides larger employment. It improves the technological stands of the people lives by using the contemporary methods of technology in the fast growing world 6. b) What are the five common steps in CRM? [5]

Ans: Five common steps of CRM are: Get executive buy-in first. Perform an in-depth needs analysis Clearly define business objectives Set measurable project goals. Determine what needs to be automated and take an incremental approach. Build and train the right teams. Manage organizational change Choose a business partner to help with implementation Define and set measurable metrics Let business processes drive the implementation

7. a) What is B2B transaction? [9] Ans: Business-to-business (B2B) describes commerce transactions between business es, such as between a manufacturer and a wholesaler, or between a wholesaler and a retailer. Contrasting terms are business-to-consumer (B2C) and business-to-go vernment (B2G).

b)

Explain the impact of e-business on supply chain management.

[9]

Ans : There are four key dimensions in which the impacts can be found: DIMENSION ELEMENTS BENEFITS/ IMPACTS Information Integration Information sharing & transparency Direct & real-time accessibility Reduced bullwhip effect Early problem detection Faster response Trust building Synchronized Planning Collaborative planning, forecasting & replenishment Joint design Reduced bullwhip effect Lower cost Optimized capacity utilization Improved service Workflow Coordination Coordinated production planning & operations, procurement, order processing, engineering change & design Integrated, automated business processes Efficiency & accuracy gains Fast response Improved service Earlier time to market Expanded network New Business Models Virtual resources Logistics restructuring Mass customization New services Click-and-mortar models Better asset utilization Higher efficiency Penetrate new markets Create new products

January-2006 [26]

1. e)Explain how the Internet is changing business model in present day firms. [ 4] Ans : The Internet radically reduces the cost of creating, sending, and storing information while making that information more widely available. The Internet re duces search costs, allowing customers to locate products, suppliers, prices, an d delivery terms. The Internet enables companies to collect and analyze more det ailed and accurate information about their customers, allowing these companies t o better target market their products and services. The Internet shrinks informa tion asymmetry and has transformed the richness and reach of information. It can help companies create and capture profits in new ways by adding extra value to existing products and services. It also provides the foundation for new products and services. 3. b) What is e-commerce? How is e-commerce business model is different from t hat of traditional commerce? [6] Ans: E-commerce Tradition Commerce 1. Reliable 2. Faster 3. Time Saving 4. Cost effective 5. Less energy consuming 6. Reduce cost 7. Easily information transferable 1. Less Reliable 2. Slow 3. Time consuming 4. Not Cost effective 5. More energy consuming 6. Doesnt reduce cost. 7. Information transferable is not easy What is the goal of installing supply chain management software? Do we n eed to have ERP software before we install supply chain software? [9] Ans: Functions of supply chain management software are: 1. Customer requirement processing 2. Purchase order processing 3. Inventory management 4. Goods receipt and Warehouse management 5. Supplier Management/Sourcing

Goals of installing supply chain management software are: a. Increase the supply chain. b. Reach directly to customer. c. To bring more customer under it scheme. d. To provide information to suppliers e. To know information about sales and stock from retailers. f. The payoff of timely and accurate supply chain information is the abilit y to make or ship only as much of a product as there is a market for. g. allows companies to reduce the amount of inventory that they keep h. Make supply chain management flexible.

i.

To make the communication between supplier and customer good.

No, we need not to have ERP software before we install supply chain software. 7. b)

Write short notes on any three of the following: iii) Role of information in supply chain management

[3]

Ans: IT infrastructure capabilities provides a competitive positioning of busin ess initiatives like cycle time reduction, implementation, implementing redesign ed cross-functional processes. Several well know firms involved in supply chain relationship through information technology. First, satisfying in fact pleasing customer has become something of a corporate obsession. Serving the customer in the best, most efficient and effective manner has become critical. Second inform ation is a crucial factor in the managers' abilities to reduce inventory and hum an resource requirement to a competitive level. Information flows plays a crucia l role in strategic planning. iv) Intranet and Internet [3]

Ans: An intranet is a private network that uses Internet protocols to securely share any part of an organization's information or operational systems within th at organization. The term is used in contrast to internet - a network between or ganizations - and instead refers to a network within an organization. Sometimes the term refers only to the organization's internal website, but may be a more e xtensive part of the organization's information technology infrastructure. The Internet is a global system of interconnected computer networks that use the standardized Internet Protocol Suite (TCP/IP) to serve billions of user s worldwide. It is a network of networks that consists of millions of private an d public, academic, business, and government networks of local to global scope t hat are linked by copper wires, fiber-optic cables, wireless connections, and ot her technologies. siness? How can Internet technologies improve relationships and service for a bu [4] Providing faster information. Reducing communication cost. Reducing time consumption. Reducing complexity.

Ans: By: a. b. c. d.

7. a) What is ERP (Enterprise Resource Planning)? Explain the different types of ERP systems. [10] Ans: Different types of ERP are: 1) SAP: The SAP ERP application is an integrated enterprise resource planni ng (ERP) software manufactured by SAP AG that targets business software requirem ents of midsize and large organizations in all industries and sectors. It allows for open communication within and between all company functions. SAP stands for Systems, Applications and Products (Systeme, Anwendungen und Produkte in the or iginal German) in Data Processing. 2) BAAN: Baan was a vendor of enterprise resource planning (ERP) software t hat is now owned by Inform Global Solutions. Baan or Baan ERP was also the name of the ERP product created by this company. It provide financial and administrat ive consulting services.

Oracle Financials: Oracle Financials products provide organizations with solutio ns to a wide range of long- and short-term accounting system issues. Regardless of the size of the business, Oracle Financials can meet accounting management de mands with: Oracle Assets: Ensures that an organization's property and equipment investment is accurate and that the correct asset tax accounting strategies are chosen. Oracle General Ledger: Offers a complete solution to journal entry, budgeting, a llocations, consolidation, and financial reporting needs. Oracle Inventory: Helps an organization make better inventory decisions by minim izing stock and maximizing cash flow. Oracle Order Entry: Provides organizations with a sophisticated order entry syst em for managing customer commitments. Oracle Payables: Lets an organization process more invoices with fewer staff mem bers and tighter controls. Helps save money through maximum discounts, bank floa t, and prevention of duplicate payments. Oracle Cash Management: Lets you perform bank reconciliation and cash forecastin g. Oracle Personnel: Improves the management of employee- related issues by retaini ng and making available every form of personnel data. Oracle Purchasing: Improves buying power, helps negotiate bigger discounts, elim inates paper flow, increases financial controls, and increases productivity. Oracle Receivables:. Improves cash flow by letting an organization process more payments faster, without off-line research. Helps correctly account for cash, re duce outstanding receivables, and improve collection effectiveness. Siebel: Siebel CRM Systems, Inc. was a software company principally engaged in the design, development, marketing, and support of customer relationship manage ment (CRM) applications. The company was founded by Thomas Siebel in 1993. At fi rst known mainly for its sales force automation products, the company expanded i nto the broader CRM market. By the late 1990s, Siebel Systems was the dominant C RM vendor, peaking at 45% market share in 2002. On September 12, 2005, Oracle Corporation announced it had agreed to buy Siebel Systems for $5.8 billion.[2][3] Siebel is now a brand name owned by Oracle Corpo ration. Siebel Systems, Inc. began in sales force automation software, then expanded int o marketing and customer service applications, including CRM. From the time it w as founded in 1993, the company grew quickly. Benefiting from the explosive grow th of the CRM market in the late 1990s, Siebel Systems was named the fastest gro wing company in the United States in 1999 by Fortune magazine. With the growth o f electronic commerce, Siebel formed strategic alliances and made several acquis itions to provide e-business solutions for CRM and related areas. One secret to Siebel's success was its ability to form alliances; as of late 2000 the company had more than 700 alliance partners. Siebel Systems uses a Customer Experience (CX) Blueprint, which is a user-center ed approach to product strategy that ensures the needs of customers are met rega rdless of channel or delivery model. As a physical artifact, the CX Blueprint co nsists of a set of user experience, technical, and product blueprints that toget her are used to set product direction. 3) 4) PeopleSoft: PeopleSoft, Inc. was a company that provided human resource management systems (HRMS) and customer relationship management (CRM) software, a s well as software solutions for manufacturing, financials, enterprise performan ce management, and student administration to large corporations, governments, an

d organizations c) What is channel conflict? Why is it becoming a growing problem in electr onic commerce? [5] Ans: Channel conflict occurs when manufacturers (brands) disintermediate their c hannel partners, such as distributors, retailers, dealers, and sales representat ives, by selling their products direct to consumers through general marketing me thods and/or over the internet through eCommerce. It is growing problem in e-commerce because: a). Some manufacturers want their brands to capture the power of the int ernet but do not want to create conflict with their other distribution channels, as these partners are necessary and viable for any manufacturer to maintain and gain success. b) Nowadays, E-commerce wins in popularity as second distribution channe l, because of the low overhead expenses and communication costs. Their advantage is at the same time their disadvantage, since consumers can communicate less ex pensive and more easily with each other too. Therefore, price and product differ entiation is getting tougher than ever. c) Newer versions of products, changes in trends, insolvency of wholesalers and retailers and the distribution of damages goods also affect channel conflict.