Tag: Concept

  • Meaning, Process, Definition, Concept of Financial Statement Analysis

    Meaning, Process, Definition, Concept of Financial Statement Analysis

    What is Financial Statement Analysis? Financial statement analysis is the use of analytical or financial tools to examine and compare financial statements to make business decisions. Financial statement analysis helps to highlight the financial performance of the company. It is the process of identifying the financial strength and weakness of a firm by properly establishing the relationship between the items on the Balance Sheet and those on the Profit and Loss Account. So, what we discussing is – Meaning, Process, Definition, Concept of Financial Statement Analysis.

    Cost Accounting is explains Meaning, Process, Definition, Concept of Financial Statement Analysis.

    In this article, we will discuss the Meaning and Process of Financial Statement Analysis, Definition of Financial Statement Analysis, and Concept of Financial Statement Analysis.

    So be it discuss:

    It is a general term referring to the process of extracting and studying information in financial statements for use in management decision making, for example, financial statement analysis typically involves the use of ratios, comparison with prior periods and budget, and other such procedures.

    The financial appraisal is a scientific evaluation of the profitability and strength of any business concerns. It seeks to spotlight the significant impacts and relationships concerning managerial performance, corporate efficiency, financial strength and weakness and creditworthiness of the company.

    Meaning and Process of Financial Statement Analysis and their Interpretation:

    The nature and importance of financial statements are explained in the preceding pages. It has been explaining that facts disclosed by financial statements are of outstanding significance to the various parties interested in the financial position of a business concern. The financial statements are helpful to the executives to assess the implications of their decisions, evaluate and review their performance and implement corrective action.

    Financial statements render invaluable service to owners, employees, customers, suppliers and the government in their respective fields of interest. The financial statements are useful and meaningful only when they are analyzed and interpreted.

    The scientific method has to adapt to analyze and interpret these statements as done in the case of preparation of these statements. The effort is taken to understand the implications of the statements is called interpretation. Some people call it ‘examination’, ‘criticism’ or ‘analysis’. Therefore, it is meaningful to call it ‘analysis and interpretation’.

    Purpose:

    The purpose of the financial analysis is to diagnose the information contained in financial statements to judge the profitability and financial soundness of the firm. Just like a doctor examines his patient by recording his body temperature, blood pressure, etc. before making his conclusion regarding the illness and before giving his treatment, a financial analyst analysis the financial statements with various tools of analysis before commenting upon the financial health or weaknesses of an enterprise.

    Definition of Financial Statement Analysis:

    Wood in his work “Business Accounting” has defined the term interpretation as follows:

    “To interpret means to put the meaning of a statement in simple terms for the benefit of a person”.

    In the words of Myers,

    “Financial statement analysis is largely a study of the relationship among the various financial factors in a business as disclosed by a single set of the statement and a study of the trend of these factors as shown in a series of statements.”

    Kennedy and Muller said,

    “Analysis and interpretation of financial statements are an attempt to determine the significance and meaning of the financial statement data so that forecast may be made of the prospects for future earnings, ability to pay interest and debt maturities (both current and long-term) and the probability of a sound dividend policy.”

    The balance sheet and profit and loss account are to interpret to convey a meaningful message to the layman who is still the typical shareholder in our country.

    Interpretation considers being the most important function of a management accountant because the management of today needs relevant data and information to conduct its function efficiently. The information is more valuable if it is presenting in an analytical form than in absolute form.

    Management Accountant is expecting to analyze and interpret the financial statements to perform his basic duty of “Communication to the management”. Interpretation in its widest sense includes many processes like the arrangement, analysis, establishing a relationship between available facts and finally making conclusions.

    The Concept of Financial Statement Analysis:

    Financial performance, as a part of financial management, is the main indicator of the success or failure of the companies. Financial performance analysis can consider as the heart of the financial decisions. Rational evaluation of the performance of the companies is essential to prepare sound financial policies and to attract potential investors. Shareholders are like in EPS, dividend, net worth and market value per share.

    Management interests in all aspects of financial performance to adopt a good financial management system and for the internal control of the company. The creditors are primarily interested in the liquidity of the company. Government interests from the regulatory point of view. Besides, other stakeholders such as economists, trade associations, competitors, etc are also interested in the financial performance of the company.

    Therefore, all the stakeholders are like in the performance of the companies but their perspective may be different. The objective of financial statement analysis is a detailed cause and effect study of the profitability and financial position.

    Process:

    Financial Analysis is the process of determining the significant operating and financial characteristics of a firm from accounting data and financial statements. The goal of such analysis is to determine the efficiency and performance of the firm’s management, as reflected in the financial records and reports.

    Financial statements are such records and reports, which contain the data required for performance management. It is therefore important to analyze the financial statements to identify the strengths and weaknesses of the company.

    The financial statements of a business enterprise are intending to provide much of the basic data used for decision making, and in general, evaluation of performance by various groups such as current owners, potential investors, creditors, government agencies, and in some instances, competitors.

    Financial statements are the reports in which the accountant summarizes and communicates the basic financial data. The financial statements provide the summary of an account of the company- the Balance Sheet reflecting the assets, liabilities, and capital as of a certain date. And, the Profit and Loss Account showing the results of operation during a period.

    The financial statements are a collection of data organized according to logical and consistent accounting procedures. The function of the financial statement is to convey an understanding of some financial aspects of the company.

    Financial statement analysis:

    Financial statement analysis involves appraising the financial statement and related footnotes of an entity. This may finish by accountants, investment analysts, credit analysts, management and other interested parties. Financial statements indicate an appraisal of a company’s previous financial performance and its future potential. The analysis of a financial statement finishes obtaining better insight into a firm’s position and performance.

    Analyzing a financial statement is a process of evaluating the relationship between parts of the financial statement to obtain. A better understanding of the firm’s position and performance. The financial analysis is thus the analysis of the financial statements. Which is finish to evaluate the performance of the company?

    Types of analysis:

    Ratio Analysis, Trend Analysis, Comparative Financial Statement Analysis, and Common Size Statement Analysis are the major tools of the financial analysis. Financial statement analysis involves the computation of ratios to evaluate a company’s financial position and results of operation. A ratio is an important tool for financial statement analysis.

    The relationship between two accounting figures expressed mathematically knows as the financial ratio. The ratio used as an index of yardstick for evaluating the financial position and performance of the firm. It helps analysts to make a quantitative judgment about the financial position and performance of the firm. It uses financial reports and data and summarizes the key relationship to appraise financial performance.

    Ratio analysis:

    Ratio analysis is such a powerful tool for financial analysis. That through it, the economic and financial position of a business unit can be fully x-ray. Ratios are just a convenient way to summarize largely. Quantities of financial data and to compare the performance of the firms. Ratios are exceptionally useful tools with which one can judge. The financial performance of the firm over some time. Performance ratio can provide insight into a bank’s profitability, return on investment, capital adequacy and liquidity.

    The above theories suggest that financial analysis helps to measure the performance of the companies. Different analysts desire different types of ratios, depending largely on whom the analysts are and why the firm is evaluating. Short-term creditors are concerning with the firm’s ability to pay its bills promptly. In the short run, the amount of liquid assets determines the ability to pay off current liabilities.

    They are like liquidity. Long-term creditors hold bonds or debentures; mortgages against the firm are like in the current payment of interest and the eventual repayment of the principal. The company must be sufficiently liquid in the short-term and have adequate profits for the long-term. They examine liquidity and profitability.

    Stockholders, in addition to liquidity and profitability, are concerned about the policies of the firm’s stock. Without liquidity, the firm could not pay the cash dividends. Without profits, the firm could not be able to declare dividends. With poor policies, the common stock would trade at a lower price in the market. Analysis of the financial statement of a company for one year or a shorter period would not truly reflect the nature of its operations. For this, it is essential that the analysis reasonably cover a longer period.

    Trend Analysis:

    The analysis made over a longer period is termed as Trend Analysis. Trend Analysis of the ratio indicates the direction of change. This method involves the calculation of the percentage relationship that each item bears to the same item in the base year. The trend percentage discloses the changes in the financial and operating data between specific periods and makes. It is possible to form an opinion as to whether favorable and unfavorable tendencies are reflecting by the data.

    Comparative Statement Analysis is another method of measuring the performance of the company. It uses to compare the performance and position of the firm with the average performance of the industry or with other firms. Such a comparison will identify areas of weakness that can then address to rectify the situation.

    Meaning Process Definition Concept of Financial Statement Analysis
    Meaning, Process, Definition, Concept of Financial Statement Analysis. Image credit from #Pixabay.
  • Meaning, Definition, and Types of Revenue Expenditure

    Meaning, Definition, and Types of Revenue Expenditure

    What is Revenue Expenditure? A revenue expenditure (REVEX) is a cost that is charged to expense as soon as the cost is incurred. By doing so, business is using the matching principle to link the expense incurred to revenues generated in the same reporting period. The amount incurred on maintaining the earning capacity of the business, The benefit of which is direct and would be in the same accounting year itself in which such expenditure has been incurred is termed as revenue expenditure. So, what is the discussion? Meaning, Definition, and Types of Revenue Expenditure.

    The Concept of Revenue Expenditure of explanation in Meaning, Definition, and Types.

    Any expenditure incurred in connection with the operation and administration of daily activities of the business is called revenue expenditure. REVEX is incurred for maintaining earning capacity and working efficiency of the fixed assets. Revenue expenditure is incurred for acquiring merchandise for resale either in its original or improved form. Its benefit expires within a year. The most important point to remember here is that the benefit of revenue expenditure would exhaust in one year.

    Revenue expenditures are recurring in nature. REVEX should be matched with the revenue receipts of the business enterprise. The basic aim and object of incurring revenue expenditure are to run and maintain the earning capacity of the business enterprise. Note: REVEX is shown on the debit side of the trading and profit and loss accounts.

    Meaning and Definition of Revenue Expenditure:

    Revenue Expenditure is that expenditure which is not a capital expenditure.

    According to Kohler,

    “It is an expenditure charged against operation; a term used to contrast with capital expenditure”.

    Revenue expenditure is incurred in the current period or in one period of account. The benefit of the revenue expenditure is utilized in that period itself.

    All the expenditures which are incurred in the day to day conduct and administration of a business and the effect of which is completely exhausted within the current accounting year are known as “revenue expenditures”.

    These expenditures are recurring by nature i.e. which are incurred for meeting day to day requirements of a business and the effect of these expenditures is always short-lived i.e. the benefit thereof is enjoyed by the business within the current accounting year. These expenditures are also known as “expenses or expired costs.” e.g.

    Purchase of goods, salaries paid, postages, rent, travel expenses, stationery purchased, wages paid on goods purchased etc. This expenditure is incurred on items or services which are useful to the business but are used up in less than one year and, therefore, only temporarily increase the profit-making capacity of the business.

    Revenue expenditure also includes the expenditure incurred for the purchase of raw material and stores required for manufacturing saleable goods and the expenditure incurred to maintain the- fixed assets in proper working conditions i.e. repair of machinery, building, furniture etc.

    The Purpose of Revenue expenditure:

    Revenue expenditure is incurred for the following Purposes:

    • All establishment and other expenses incurred in the normal course of business. For instance, Administrative expenses of the business, expenses incurred in manufacturing and selling products.
    • Expenses incidental to the carrying of a business, the benefit of which is consumed within the accounting period. For instance, Rent, Wages, Salaries, Advertising, Taxes, Insurance etc.
    • Expenditure on goods purchased for resale. Example, the cost of goods purchased or the cost of raw materials etc.
    • For maintaining fixed assets in working order. For instance, repairs, renewals, and replace­ment of existing assets, depreciation etc.

    These revenue expenditure items appear in Trading and Profit and Loss Account.

    Items of Revenue Expenditure:

    • Expenditure on Rent, Wages, Carriage, Salaries, Postage, Insurance, Advertising etc.
    • Interest on loan borrowed for running the business.
    • Cost of goods bought for resale.
    • Cost of raw materials consumed in the course of manufacturing.
    • Expenses incurred for maintenance of various assets by way of repairs, renewals and re­placement on building, plant, machinery, tools, fixtures, van, car etc. to keep them in good condition.
    • Depreciation of fixed assets.
    • Taxes and legal expenses.
    • Loss arising from the sale of fixed assets.
    • Maintenance of lights and fans.
    • All expenses incurred in the manufacturing and distribution of the products handled.
    • Wages paid for the sale of goods.
    • Loss of goods by fire or other reasons.
    • Discounts and allowances.

    The Types of Revenue expenditure:

    There are two types of revenue expenditure:

    • Maintaining a revenue-generating asset: This includes repair and maintenance expenses, because they are incurred to support current operations, and do not extend the life of an asset or improve it.
    • Generating revenue: This is all day-to-day expenses needed to operate a business, such as sales salaries, rent, office supplies, and utilities.

    Other types of costs are not considered to be revenue expenditures, because they relate to the generation of future revenues. For example, the purchase of a fixed asset is categorized as an asset and charged to expense over multiple periods, to match the cost of the asset against multiple future periods of revenue generation.

    Revenue expenditure includes the following types of expenditures:
    • Items of expense incurred for producing finished goods such as the purchase of raw material and other direct expenses etc.
    • Establishment cost such as rent, light, repairs etc.
    • Administrative costs such as salaries of the staff, telephone expenses etc.
    • Selling and distribution expenses such as advertisement expenses, commission etc.
    • Financial expenses such as discount allowed, interest on loans etc.
    • Other miscellaneous expenses for maintaining the business enterprise such as repairs and renewals, insurance etc.
    Meaning Definition and Types of Revenue Expenditure
    Meaning, Definition, and Types of Revenue Expenditure. Image credit from #Pixabay.
  • Explanation of the Major Elements of Operations Management

    Explanation of the Major Elements of Operations Management

    Operations management is the business function that responds to planning, organizing, coordinating and controlling the resources needed to produce a company’s products and services. The operations function can be connected to other functional operations within the organization such as marketing, finance, human resource and etc. The process of changing inputs into outputs thereby adding value to some entity. Right quality, right quantity, right time and right price are the four basic requirements of the customers and as such, they determine the extent of customer satisfaction. Do you study to learn: If Yes? Then read the lot. Let’s Study: Explanation of the Major Elements of Operations Management.

    The concept of Elements Discussing the topic: Explanation of the Major Elements of Operations Management.

    The operations manager is the person who supervised the production, makes the decision on operations processes and regarding connecting into other functional areas. Thus, today every company realized that operations management is important and also agreed that is the main core function to organize their organization. So it can be described that all functional areas undertake operations activities because they all produce the services and goods.

    The Major elements of Operations Management:

    The following elements are below.

    Selection and Design:

    The right kind of products and good designs of the products are crucial for the success of an organizing. A wrong selection of the product and/or poor design of the products can render the company’s operation ineffective and non-competitive. Products/services, therefore, must be chosen after a detailed evaluation of the product/services alternatives in conformity with the organization’s objectives. Techniques like value engineering may be employed in creating alternate designs, which are free from unnecessary features and meet the intended functions at the lowest cost.

    The Process, Selection, and Planning:

    Selection of the optimal “conversion system” is as important as the choice of products/services and their design. Process selection decisions include decisions concerning the choice of technology, equipment, machines, material handling systems, mechanization, and automation. Process planning involves detailing of processes if resource conversion required and their sequence.

    Plant location:

    Plant location decisions are strategic decisions and once the plant is set up at a location, it is comparatively immobile and can be shifted later only at a considerable cost and interruption of production. Although the problem of location choice does not fall within preview the production function and it occurs infrequently, yet it is of crucial importance because of its major effect on the performance of every department including production. Therefore, it is important to choose the right location, which will minimize the total “delivered customer” cost (Production and distribution cost). Locational decisions involve evaluation of locational alternatives against the multiplicity of relevant factors considering their relative importance to the organization and selecting those, which are operationally advantageous to the organization.

    Facilities layout and materials handling:

    Plant layout is concerned with the relative location of one department (Work center) with another in order to facilitate material flow and processing of a product in the most efficient manner through the shortest possible time. A good layout reduces material handling cost, eliminates delays and congestion, improves coordination, provide good housekeeping etc. while a poor layout results in congestion, waste, frustration, inefficiency, and loss of profit.

    The Planning of capacity:

    Capacity planning concerns determination and acquisition of productive resource to ensure that their availability matches the demand. Capacity decisions have a direct influence on the performance of the production system in respect of both resource productivity and customer service (i.e. delivery performance). Excess capacity results in low resource productivity while inadequate capacity leads to poor customer service. Capacity planning decisions can be short-term decisions. Long-term capacity planning decisions concern expansion/contraction of major facilities required in the conversion process, the economics of multiple shift operation, development of vendors for major components etc. Short-term capacity planning decisions concern issues like overtime working, sub-contracting, shift adjustments etc. Break-even analysis is a valuable tool for capacity planning.

    Production, Planning, and Control (PPC):

    Production planning is the system for specifying the production procedure to obtain the desired output in a given time at optimum cost in conformance with the specified standard of quality, and control is essential to ensure that manufacturing takes place in the manner stated in the plan. Also learn, What is Planning?

    Control of Inventory:

    Inventory control deals with the determination of optimal inventory levels of raw materials, components, parts, tools; finished goods, spares, and supplies to ensure their availability with minimum capital lock up. Material requirement planning (MRP) and just in time (JIT) are the latest techniques that can help the firm to reduce inventory.

    Assurance and Control of Quality:

    Quality is an important aspect of the production system and it must ensure that services and products produced by the company conform to the declared quality standards at the minimum cost. A total quality assurance system includes such aspects as setting standards of quality, inspection of purchased and sub-contracted parts, control of quality during manufacture and inspection of finished product including performance testing etc.

    Work-study and Job design:

    Work-study, also called time and motion study, is concerned with the improvement of productivity in the existing jobs and the maximization of productivity in the design of new jobs. Two principal component of work-study is Method study and Work Measurement.

    Maintenance and replacement:

    Maintenance and replacement involve selection of optimal maintenance (preventive and/or breakdown) policy to ensure higher equipment availability at minimum maintenance and repair cost. Preventive maintenance, which includes preventive inspection, planned lubrication, periodic cleaning and upkeep, planned replacement of parts, condition monitoring of the equipment and machines, etc. is most appropriate for critical machines.

    Reduction and Control of Cost:

    Effective production management must ensure the minimum cost of production and in this context cost reduction and cost control acquire significant importance. If you know what is the cost of capital also help for control. There is a large number of tools and techniques available that can help to make a heavy dent on the production cost.

    Explanation of the Major Elements of Operations Management
    Image credit from ilearnlot.com.
  • Meaning, Definition, and Objectives of Career Management

    Meaning, Definition, and Objectives of Career Management

    Career Management; A common way of career action is by choosing a person to proceed through the life of his employment. It can represent as a person whom a person has organized for so many years. Career management is the engagement plan of someone’s activities and attachments in the work done during his life for better fulfillment, development and financial stability. This is a sequential process that starts with understanding itself and involves business awareness. Do you study to learn: If Yes? Then read the lot. Let’s Study Meaning, Definition, and Objectives of Career Management. Read this in the Hindi language: करियर प्रबंधन का अर्थ, परिभाषा, और उद्देश्य। 

    The concept of Career Management Discussing the topic: Meaning, Definition, Benefits, Objectives, and Elements of Career Development.

    Many people feel satisfied by achieving their career goals. Also, others have a strong sense that their career, their life, and their abilities have become incomplete. Employers’ employees also have a profound impact on their careers. Some organizations have formal career management procedures, while others worry very little about it. Career management is defined as the ongoing process of preparation, implementation, and monitoring of career plans. It can do either by a person alone or there may a consolidate activity with the organization’s career system.

    Meaning and Critical Concept of Career Management:

    Career management is a process that enables employees to better understand, develop and give direction to their career skills and to effectively utilize those skills and interests both within and outside the organization. Specialized career management activities provide realistic career-oriented assessment, post open jobs and offer formal career development activities.

    Career development involves the lifespan series of activities that contribute to a person’s career exploration, establishment, development, success, and fulfillment. Career planning is a deliberate process by which a person becomes aware of his skills, interests, motivation, knowledge and other such characteristics. He also receives and receives information about opportunities and options, identifies career goals and establishes action plans to achieve specific goals.

    Career management and career planning activities are complementary and can strengthen each other. Career management can also consider a lifelong, self-monitoring process of a career plan. It involves choosing and setting individual goals and preparing strategies for achieving them.

    The Concept of Career Management:

    However, in an organizational context, the focus is on taking action to meet the estimated human resources requirements.

    • A person’s career is the only source of natural expression of self. A school of thought describes the purpose of life and the work of someone’s manifestation and the purpose of existence or existence. Still, others believe that there is a big difference between a person’s career and his life. In any case, careers are an integral part of one’s life and hence its management is needed.
    • Career management is more or less like organizational management; There is no classification of individuals after all organizations! The process of career management starts with the construction of goals and objectives, which are short-lived or for short-term achievement.
    • This is a difficult task compared to a long-term career goal, which is more or far-sighted. Since the objective is short-term or immediate, it is verb-oriented. Second, it demands every moment, every moment of achievement. Then this step can be very difficult for those who are not aware of available opportunities or are not fully aware of their talents. However, more specific, measurable and achievable goals are likely to have more and more fruit plan management plans.
    • A well-prepared strategy is needed to achieve the goal, which means the action plan to achieve the goal. After this, it will have to draft or establish rules that govern procedures/policies/norms or rules or procedures.
    • The final step in the career management process is to evaluate the career management plan to ensure that progress is being made or if there is a need for some changes later.

    Benefits of Career Management:

    The following benefits below are;

    1] Staffing List:

    Effective Career Management ensures the continuous supply of professional, technical and managerial talent to meet an organizational goal.

    2] Staffing from within:

    Most organizations prefer to promote employees from within the available positions due to many potential benefits. To recruit from within, it requires a strong career management program, which ensures effective performance in the effective new job of employees.

    3] Resolving employees problems:

    Effective career management can act as a measure of some employees’ problems. Employee business rates can reduce due to the sense of the existence of opportunity within the organization. It may be easy to go for recruits because the company develops its employees and provides better career opportunities.

    4] The satisfactory employee needs:

    The present generation of employees is very different from those of the previous generation who are in the set of their needs. Then higher levels of education have raised expectations of their career and many employees are directly responsible for providing better opportunities to achieve their career expectations.

    5] Advanced Motivation:

    As progress with career path is directly related to job performance, one employee can motivate and can perform at the top level to meet career goals.

    6] Employment Equity:

    Effective Career Management Demands Try to eliminate fair and equitable recruitment, selection and appointment and discrimination against publicity and career mobility. Such positive programs have formal provisions which help in increasing the career mobility of women and other minority groups, which emphasize job equity.

    Objectives of Career Management:

    Career management programs include a large number of these human resource management practices with the following objectives:

    1] Assisting employees to improve their performance:

    Career management programs try to involve employees in setting their goals and identifying their strengths and weaknesses. It helps with the identification and convenience of the training needs and opportunities of the employees. This is achieving primarily by building the process of reaction and discussion in the performance management system of the institutions.

    2] Explain the available career options:

    Through career management programs, employees are informing about career options available within the institute. It helps the employees with the recognition of the skills and other qualities required for current and future jobs.

    Most Career Management programs want to focus on the employees’ career plans at the institute, thereby increasing their commitment to the organization. In doing so, career paths are developing which indicates the mobility in the various directions in the Institute for the employees.

    3] Align the aspirations of employees with organizational objectives:

    Many organizations strive to help employees in their career plans through career management programs. Career management programs now want to improve the job matching with the right staff. Evaluating the skills and competencies of the employees can help them adjust to those positions which make them better suited.

    Through the application of practices such as transfer and rotation, the operational effectiveness of an institution can improve. As a result of career management programs, the need for external recruitment can also reduce as the employees with the necessary abilities have come to know through their career planning activities.

    From the perspective of the employer, the objective of your Career Management program should be to ensure the availability of capable and skilled employees within your organization.

    Elements of Career Management:

    The following three elements are common to most career management programs:

    1] Career Planning:

    Career planning is a deliberate process to be aware of the opportunities, obstacles, options, and goals related to careers and the identification of programming work, education and related development experiences, to achieve specificity, direction, time and Sequence can provide.

    The goal of becoming something in life. Career planning is also a process done by employees and their supervisors. The employee is responsible for self-assessment, identifies career interests and needs for development. As part of the self-assessment process, the employee analyzes his skills and weaknesses, along with his strengths and weaknesses.

    Career planning is also more effective when done by an individual and organization jointly. There is a stake in the organization’s successful career plan. Because of the continuous supply of adequate training people are required to do jobs at every level of the organization.

    2] Career Path:

    Based on the career expectations identified in the career planning process, potential career paths are mapping to employees. Career path sets a sequence of posts for which employees can promote, moved and rotated. However, it should note that each employee may have a crowd of career pathing options.

    The career path should establish an organization’s career development system. The existence of such career paths communicates employees with specific step-by-step objectives and identifies the potential role model in the organization. In establishing a career path, employees and their supervisors should be realistic in terms of their ability and time limits. In which career goals can achieve in career paths.

    3] Career Development:

    Career Development refers to a planned effort to connect the person’s career needs with the workforce requirements of the organization. It can see as a process to help in organizing a career in musicians with business needs and strategic direction of the organization. It is also important to note that, with the concept of alignment between the person and the organization, career development is a continuous process. One of the roles of the organization is to provide training and development opportunities to meet the needs of the movement with the career path.

    While these three elements are identifying as different practices, they complement each other during the career management process and inform. Also, to choose any career path, you can use the services of different career evaluation tests at different stages. Which are in line with the likes and dislikes, strengths and weaknesses. These tests are from those people who are small and short, providing complete details of minutes. Some tests have multiple intelligence between MBTY (Myers and Briggs Type Indicator), SDI (Strength Deployment List) and others.

    The job of career management is more on the personal self than the employer. Ensuring personal development in terms of skills, competencies, changes in attitude over time, things may need to take care of someone. There is a need to complete and evaluate short-term goals. There is a need to revise long-term career goals with changes in employment scenario and self; Organizations cannot or may not worry on a large scale or combine your priorities with careers and lives. Often counseling is helpful to evaluate the job and prospects and to establish the clarity of values because they make changes with time. Read this in the Hindi language: करियर प्रबंधन का अर्थ, परिभाषा, और उद्देश्य। 

    Meaning Definition and Objectives of Career Management

  • Bullwhip Effect in Supply Chain Management

    Bullwhip Effect in Supply Chain Management

    What is the Bullwhip Effect? Understanding the meaning, definition, concept, Eliminating, and Causes in Supply Chain Management!

    Meaning: The bullwhip effect is a distribution channel phenomenon in which forecasts yield supply chain inefficiencies. It refers to increasing swings in inventory in response to shifts in customer demand as one moves further up the supply chain. The meaning, definition, concept, Eliminating, and Causes, Explains Bullwhip Effect in Supply Chain Management. The concept first appeared in Jay Forrester’s Industrial Dynamics (1961) and thus it is also known as the Forrester effect. The bullwhip effect can be explained as an occurrence detected by the supply chain where orders sent to the manufacturer and supplier create larger variance than the sales to the end customer.

    The bullwhip effect was named for the way the amplitude of a whip increases down its length. The further from the originating signal, the greater the distortion of the wave pattern. In a similar manner, forecast accuracy decreases as one moves upstream along the supply chain. These irregular orders in the lower part of the supply chain develop to be more distinct higher up in the supply chain. This variance can interrupt the smoothness of the supply chain process as each link in the supply chain will over or underestimate the product demand resulting in exaggerated fluctuations. Who are the Users of Accounting Information inside the Organization?

    The Concept of Bullwhip Effect in Supply Chain Management

    The problem of the Bullwhip effect in supply chain management has always been a concern for many years. Due to its non-industry specific nature, it has grabbed the attention of many professionals from diverse industries and business schools. Bullwhip effect as its name suggests is an oscillation in the chain or pipeline. In the supply chain, this effect occurs when there is a constant fluctuation in the demand. In-congruence in the information leads to its distortion thereby creating a bullwhip. The expression “Bullwhip Effect” was termed by executives of P&G, the company that manufactures Pamper brand of diapers.

    These executives observed that while the consumer demand for Pamper’s Diapers was fairly constant over time, the orders for diapers placed by retailers to their wholesalers or distributors were quite variable i.e., exhibited significant fluctuations over time. In addition, even larger variations in order quantities were observed in the orders that P&G received from its wholesalers. Also, read it The Motivated Personality born in India They inspire Always.

    This increase in the variability of the orders seen by each stage in a supply chain was called the bullwhip effect. This situation of misalignment in the supply chain can be termed as ‘Asymmetric Information’ where different parties having different states of private information about demand conditions, products, and the chain operations. The problem of this asymmetry arises because participating firms generally lack the knowledge required about each other’s plans and intentions to adequately harmonize their services and activities.

    Supply chain members often do not wish to share their private information completely and faithfully with all others due to the profitability of that actual or perceived information. Thereby the whole supply chain suffers from sub-optimal and opportunistic behavior. These decisions occur when the members don’t have sufficient visibility to resolve various trade-offs in decision making because lack of information causes decisions to be made in a narrow scope that cannot ensure that products flow properly to end customers. Moreover, with limited information sharing, members don’t have consistent perceptions of market needs and visibility over performance at the other levels of the supply chain.

    As a consequence, decisions are made based on either the best estimation of the available data or an educated guess. Such decisions can be biased and prevent the individual member from attaining the optimal solution of the supply chain. For example, the manufacturer often uses incoming orders with larger variance and not sales data from the retailer as a signal about the future product demand. Asymmetric information also produces problems of the vulnerability of opportunistic behavior. Specifically, adverse selection and moral hazard manifest themselves in the relationship between the supply chain members.

    The negative selection of adverse selection, for example, is that the member firms cannot optimize supply chain performance because they don’t possess the required capability to meet the predetermined customer service level. To explain this effect a very simple example of the two-tier supply chain, a retailer and a manufacturer, can be taken into account. The retailer observes customer demand and places orders to the manufacturer. For determination of the order quantity to place with the manufacturer, the retailer will use the observed demand data of customer and a demand forecasting technique. In the 2nd stage, the manufacturer plays his role of forecasting by observing the retailers demand to place the order with his suppliers.

    In many supply chains, the manufacturer doesn’t have access to customer’s demand data thereby making him rely on the retailer’s data to forecast. As the bullwhip effect implies (the orders placed by the retailer are significantly more variable than the customer demand observed by the retailer), the manufacturer’s forecasting and inventory control problem will be much more difficult than the retailer’s forecasting and inventory control problem. In addition, the increased variability will force the manufacturer to carry more safety stock or to maintain higher capacity than the retailer in order to meet the same service level as the retailer.

    What Contributes to the Bullwhip Effect?

    There are many factors said to cause or contribute to the bullwhip effect in supply chains; the following list names a few:

    • Free return policies: Customers may intentionally overstate demands due to shortages and then cancel when the supply becomes adequate again, without return forfeit retailers will continue to exaggerate their needs and cancel orders; resulting in excess material.
    • Demand information: Relying on past demand information to estimate current demand information of a product does not take into account any fluctuations that may occur in demand over a period of time.
    • Price variations: Special discounts and other cost changes can upset regular buying patterns; buyers want to take advantage of discounts offered during a short time period, this can cause uneven production and distorted demand information.
    • Order batching: Companies may not immediately place an order with their supplier; often accumulating the demand first. Companies may order weekly or even monthly. This creates variability in the demand as there may, for instance, be a surge in demand at some stage followed by no demand after.
    • Lack of communication between each link: in the supply chain makes it difficult for processes to run smoothly. Managers can perceive a product demand quite differently within different links of the supply chain and therefore order different quantities.
    • Disorganization between each supply chain link: with ordering larger or smaller amounts of a product that is needed due to an over or under reaction to the supply chain beforehand.

    Eliminating Bullwhip Effect in Supply Chain Management

    Following are a set of efficient countermeasures that were designed to minimize the negative effects of the Bullwhip effect;

    1. Avoid multiple demand forecast updates.
    2. Eliminate gaming in shortage.
    3. Stabilize prices, and.
    4. Break order batches.

    However, we have to admit that the above-mentioned measures of reduction of the Bullwhip effect are not exhaustive and cannot fully eliminate the existence of this effect.

    Countermeasures of Bullwhip Effect in Supply Chain Management

    Actual demand for a product is influenced by several factors such as competition, prices, weather conditions, technological developments, and consumers’ general confidence. These would be considered external and unmanageable factors. There are other uncertainties involved as well that can have an effect on the supply chain such as problems in delivery time due to production machine failures. Techniques to lessen or curtail the bullwhip effect would be to understand and recognize who or what is suggesting the variations in demand. Is it the retailer, manufacturer, the customer, or the distributor? The key element to eliminating this setback is being aware of where the demand changes are beginning. Techniques that can be used or put into place to reduce the bullwhip effect is sharing information along the supply chain, Vendor Managed Inventory (VMI), and managing e-business.

    The most obvious way to reduce the bullwhip effect is to improve communication and forecasting along the supply chain. Master Data Management (MDM) is can be looked at to integrate all data in an organization at the highest level, both internally and externally. One of the most notable examples of information sharing is between large manufacturers and retailers. Inventory if properly managed, it can increase profits and efficiency. The implementation of a Vendor-Managed Inventory (VMI) initiative would be a key factor in improving and controlling the bullwhip effect. VMI indicates that the vendor, usually a distributor, maintains the inventories for manufacturer or buyer and in turn will reduce warehouse costs for suppliers. VMI alleviates uncertainty of demand and replenishment decisions can be made according to operating needs, and also has heightened awareness of trends in demand. E-commerce brings about new opportunities to improve the performance of the supply chain. The primary advantages of internet utilization are speed, decreased costs, the potential to shorten the supply chain, and flexibility.

    Electronic marketplaces provide for more efficient resource allocation, better information flow, and dissemination on products and services in the supply chain. Electronic data interchange (EDI) can be implemented to help supply chain managers in reducing misleading signals sent from sales and marketing (distribution). Enterprise resource planning (ERP) is one of the most successful tools for managing supply chains. ERP is software that integrates the planning, management, and use of all sources in the entire enterprise. The major objective is to integrate all departments and functional information flow across a company onto a single computer system that can serve all of the enterprise’s needs.

    A plan created from an SCM system that allows companies to quickly assess the impact of their actions on the entire supply chain, including customer demand, can only be done with the integration of ERP software. ERP and SCM can help alleviate the bullwhip effect across the supply chain by having a shared understanding of what needs to get done, managing the variations in the organization, communication among all that are involved especially top management, and having single control of replenishment or VMI can overcome inflated demand forecasts. Long lead times should also be reduced where it is reasonably beneficial.

    Causes of Bullwhip Effect in Supply Chain Management

    There are four main causes behind building up of bullwhip effect in the supply chain.

    These causes are:

    1. Demand Forecasting.
    2. Order Batching.
    3. Rationing and Shortage Gaming, and.
    4. Price Fluctuation.

    From the above information, it is clear enough that all the factors or elements resulting in bullwhip effect originate from a common ground i.e. information sharing. Case Study of International Marketing Strategy in PepsiCo. It is evident enough that the lack of information and interaction between different stages evolve bullwhip in the system thereby plaguing the whole Supply Chain.

    Bullwhip Effect in Supply Chain Management
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  • Learn What? Study of Accounting Concept and Conventions!

    Learn What? Study of Accounting Concept and Conventions!

    Understanding and Learn What? Study of Accounting Concept and Conventions!

    Accounting in the past was mainly used to (1) keep control over property and assets of the business concerned and (2) ascertain and report about the profit or loss and the financial position relating to the various periods. But now a day’s accounting is used not only for the above-mentioned purposes but also for collecting, analyzing and reporting of information to the management and others at the required points of time to facilities rational decision making. Learn What? Study of Accounting Concept and Conventions!

    Moreover, the accounts in the past were prepared mainly for the use of proprietor. Today financial statements are required by the proprietors, creditors, potential investors, Government and many others. The proprietors study the financial statements to know about the profitability of their business. Creditors study them to ascertain the solvency of the business. Prospective investors are interested in them for the ascertainment of the correct earning potential of the business. The government makes use of these statements for finding out the net contribution that a business can make the economic well-being of the country.

    To satisfy the diverse and complex needs of those who use accounting, one needs something more than the clerical procedures, journalizing, posting, taking out trial balance and closing the books etc. The accountant should have ‘guides to action’ or ‘principles’ for completing his work of a wide dimension. The usefulness of accounting will be maximized only if there exist some generally accepted concepts regarding the nature and measurement of liabilities, assets, revenues, and expenses.

    There must also be some widely supported standards of disclosure and reporting. There will be widespread understanding of and reliance on accounting statements only if they are prepared in conformity with generally accepted accounting principles. If there is no common agreement on accounting matters then complete chaotic conditions prevail as in that case, every businessman and/or every accountant could follow his own definition of revenue and expense.

    Definition: The rules conventions of accounting are commonly referred to as ‘principles’. A universal definition of the ‘accounting principles’ is difficult to give. However, ‘accounting principles’ can be defined in the following two ways :

    1. Accounting Principle is a “General Truth” or ‘fundamental belief. This definition implies a scientific bias and therefore, its application in the face of ever-changing socioeconomic factors which affect the very basis of a business is doubtful.
    2. Accounting principle may be defined as a ‘rule of action or conduct’. This definition finds favor with the American Institute of Certified Public Accountants as it refers to the changing character of rules of action or conduct due to the changes in business practices etc. According to AICPA, accounting principle is a general law or rule adopted or processed as a guide to action. The accounting principles do not prescribe one way of doing things. They recognize that there are a number of ways in which one thing can be done. The accountant has considerable latitude and choice within the generally accepted accounting principles in which to express his own idea as to the best way of recording and reporting is specified account. The practice of recording and reporting may thus differ from company to company.
    3. It should be noted that it would be incorrect to suggest that accounting principles are a body of basic laws like those found in natural sciences like Physics and Chemistry. Accounting principles are manmade and hence are more properly associated with such items as concepts, conventions, and standards. Accounting principles were not deducted from basic atoms, not is their validity verifiable by observation and experiment in a laboratory. Accounting principles are constantly evolving, being influenced by business practices, the needs of statement users, legislation and governmental regulations the opinions and actions of shareholders, labor unions, creditors and management; and the logical reasoning of accountants. The sum total of all such influences finds its expression first in accounting theory. Some theories are accepted while some others are rejected. Theory becomes an accounting principle only when it is generally accepted.

    A distinction between Fundamental Accounting Assumptions and Accounting policies has been made by the International Accounting Standards Committee (1ASC). Fundamental Accounting assumptions or postulates according to the ISC underlie the preparation of financial statement. They need not be specifically stated on the face of such statements. Their acceptance and use is assumed in the preparation of financial statements.

    Disclosure with full reasons, however, must be made in case they are not followed- Accounting policies, on the other hand, encompass the principles, basis, conventions, rules, and procedures adopted by management in preparing and presenting financial statements. There are, as stated above, much different accounting and applying those which in the circumstances of the enterprise, are best suited to present properly its financial position and the results of its operations.

    Accounting Concepts:

    Following concept are:

    • Business Unit Concept: A business and its owner should be treated differently, as far as their financial transactions are concerned.
    • Money Measurement Concept: Only business transactions that can be expressed in terms of wealth are recorded in accounting, although records of other types of transactions can be kept separately.
    • Dual aspect concept: For each credit, a related debt is made. The recording of the transaction is completed only with a double aspect.
    • Concerns are going on the concept: In accounting, a business is expected to continue for a long time and fulfills its commitments and obligations. It assumes that the business will not be forced to stop working on “fire sale” prices and to eliminate their assets.
    • Cost concept: Fixed assets of a business are recorded based on their original cost in the first year of accounting. After this, these properties are recorded less depreciation. There is no increase or fall in market value. The concept applies only to certain assets.
    • Accounting year concept: Each business chooses a specific time period to complete the cycle of accounting process – for example, monthly, quarterly or yearly – according to a financial or calendar year.
    • Matching Concept: This theory states that for every entry of revenue recorded in a given accounting period, a uniform expense entry should be recorded to accurately calculate profit or loss in any period.
    • Acquisition concept: According to this concept, only after the profit is accrued. Payment of an advance or fee is not considered to be profitable unless the goods or services are distributed to the buyer.
    Accounting Conventions:

    The most commonly held convention is “historical cost convention”. For this, the cost of the transaction should be recorded on pricing at that time, and properties should be valued at their original cost. Following conventions are:

    There are four main conventions in practice in accounting: conservatism, consistency, full disclosure, and materiality.

    Conservatism is the convention by which, when two values of a transaction are available, the lower-value transaction is recorded. By this convention, profit should never be overestimated, and there should always be a provision for losses.

    Consistency prescribes the use of the same accounting principles from one period of an accounting cycle to the next so that the same standards are applied to calculate profit and loss.

    Materiality means that all material facts should be recorded in accounting. Accountants should record important data and leave out insignificant information. An important convention. As we can see from the application of accounting standards and accounting policies, the preparation of accounts involves a high degree of judgment. Where decisions are required about the appropriateness of a particular accounting judgment, the “materiality” convention suggests that this should only be an issue if the judgment is “significant” or “material” to a user of the accounts. The concept of “materiality” is an important issue for auditors of financial accounts.

    Full disclosure entails the revelation of all information, both favorable and detrimental to a business enterprise, and which are of material value to creditors and debtors.

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  • What is the Source of Recruitment in the Organization?

    What is the Source of Recruitment in the Organization?

    Source of Recruitment in the Organization; The sources of employees can classify into two types, internal and external. The concept of the study Explains – the Source of Recruitment in the Organization: Internal Sources and their benefits and limitations, External Sources and their benefits and limitations. Also, Filling a job opening from within the firm has the advantages of stimulating preparation for possible transfer of promotion, increasing the general level of morale, and providing more information about job candidates through analysis of work histories within the organization.

    Understanding and Learn, What is the Source of Recruitment in the Organization?

    A job posting has several advantages. Also, From the viewpoint of the employee, it provides flexibility and greater control over career progress. For the employer, it should result in better matches of employee and job.

    Meaning and Sources of Recruitment:

    Whenever there is a vacancy in the organization, generally it is to fill. To make the candidate avail­able for filling those vacancies, their selection procedure and placement on a proper job comes under the purview of recruitment. As soon as the available vacancies know, they advertise through different media, and accordingly the applications collect for the vacant posts. Also, A group of candidates interested in doing the job and are eligible to do, it creates through recruitment.

    It is an operative function of human resource management coming under the managerial function called organizing. In the words of Edwin Flippo, ‘recruitment is the process of searching for prospective employees and stimulating them to apply for jobs in the organisation’.

    In most instances, the jobs post on notice boards, though some carry listings in the company newspapers. Also, The posting period is commonly one week, with the final decision for hiring being completed within four weeks.

    Internal applications often restrict certain employees.

    The guidelines for one company including (1) “good” or “better” on the most recent performance review; (2) dependable attendance record; (3) not under probationary sanction; and (4) having been in the present position for 1 year. Also, The present supervisor must at some time inform of his or her subordinate’s interest in another job. Some require immediate notification, while others inform only if the employee becomes a prime candidate for the listed opening. The personnel unit acts as a clearinghouse in unrealistic screening applications, preventing an excessive number of bids by a single employee, and counseling employees who are constantly unsuccessful in their attempt to change jobs.

    Inevitably, the firm must go to external sources for lower entry jobs, for expansion, and for positions whose specifications cannot be met by present personnel. Thus the firm has a number of outside sources available, among which are the following:

    Advertising:

    There is a trend toward more selective recruitment in advertising. Also, This can affect at least two ways. First, advertisements can place in media read-only by particular groups. Secondly, more information about the company, the job, and the job specification can include in the ad to permit some self-screening.

    Employment Agencies:

    Additional screening can affect the utilization of employment agencies, both public and private. Today, in contrast to their former unsavory reputation, the public employment agencies in several States well-regard, particularly in the fields of unskilled semi-skilled, and skilled operative jobs. In the technical and professional areas, however, the private agencies appear to be doing most of the work. Many private agencies tend to specialize in a particular type of worker and job, such as sales, office, executive, or engineer.

    Employee Referrals:

    Friends and relatives of present employees are also a good source from which employees may be drawn. When the labor market is very tight, large employers frequently offer their employees bonuses or prizes for any referrals that hire and stay with the company for a specific length of time. Some companies maintain a register of former employees whose record was good to contact them when there are new job openings for which they are qualified. Also, This method of recruitment, however, suffers from a serious defect that it encourages nepotism, i.e. persons of one’s community or caste employe, who may or may not be fit for the job.

    Schools, Colleges and Professional Institutions:

    Offer opportunities for recruiting their students. Also, They operate placement services where complete bio-data and other particulars of the students are available. The companies that need employees maintain contact with Guidance Counsellors of Employment Bureaus and teachers of business and vocational subjects. The prospective employers can review Credentials and interview candidates for management trainees or probationers. Whether the education sought involves a higher secondary certificate, specific vocational training, or a college background with a bachelor’s, master’s, or doctoral degree, educational institutions provide an excellent source of potential employees for entry-level positions in organizations. These general and technical/ professional institutions provide blue-collar applicants, white-collar and managerial personnel.

    Labor unions:

    Firms with closed or union shops must look to the union in their recruitment efforts. Disadvantages of a monopolistically control labor source are offset, at least particularly, by savings in recruitment costs. With one-fifth of the labor force organized into unions, organized labor constitutes an important source of personnel.

    Casual applicants:

    Unsolicited applications, both at the gate and through the mail, constitute a much-used source of personnel. These can develop through the provision of attractive employment office facilities and prompt and courteous replies to unsolicited letters.

    Professional organizations or recruiting firms or executive recruiters:

    Maintain complete information records about employed executives. These firms look upon as ‘head hunters’, ‘raiders’, and ‘pirates’ by organizations that lose personnel through their efforts. However, these same organizations may employ “executive search firms” to help them find talent. These consulting firms recommend persons of high caliber for managerial, marketing, and production engineers’ posts.

    Indoctrination seminars for colleges professors:

    Are arrange to discuss the problem of companies and employees. Professors invite to take part in these seminars. Visits to plants and banquets arrange so that the participant professors may favorably impress. Also, They may later speak well of a company and help it in getting the required personnel.

    Unconsolidated applications:

    For positions in which large numbers of candidates are not available from other sources, the companies may gain keeping files of applications received from candidates who make direct inquiries about possible vacancies on their own or may send unconsolidated applications. Also, The information may index and file for future use when there are openings in these jobs.

    Nepotism:

    The hiring of relatives will be an inevitable component of recruitment programs in family-owned firms, such a policy does not necessarily coincide with hiring based on merit, but interest and loyalty to the enterprise are offsetting advantages.

    Leasing:

    To adjust to short-term fluctuations in personnel needs, the possibility of leasing personnel by the hour or day should consider. This practice has been particularly well-developed in the office administration field. Also, The firm not only obtains well-trained and selected personnel but avoids any obligation in pensions, insurance, and other fringe benefits.

    Voluntary organizations:

    Such as private clubs, social organizations might also provide employees – handicaps, widowed or married women, old persons, retired hands, etc., in response to advertisements.

    Computer data banks:

    When a company desires a particular type of employee, job specifications and requirements are fed into a computer, where they match against the resume data stored therein. The output is a set of resumes for individuals who meet the requirements. Also, This method is very useful for identifying candidates for hard-to-fill positions which call for an unusual combination of skills.

    Sources of Recruitment:

    The eligible and suitable candidates required for a particular job are available through various sources.

    Internal Sources of Recruitment:

    1. Promotions:

    The promotion policy follows as a motivational technique for the employees who work hard and show good performance. Also, Promotion results in enhancements in pay, position, responsibility, and authority. The important requirement for the implementation of the promotion policy is that the terms, condi­tions, rules, and regulations should be well-defined.

    1. Retirements:

    The retired employees may give the extension in their service in case of the non­-availability of suitable candidates for the post.

    1. Former employees:

    Former employees who had performed well during their tenure may call back; and, higher wages and incentives can pay to them.

    1. Transfer:

    Employees may transfer from one department to another wherever the post becomes vacant.

    1. Internal advertisement:

    The existing employees may interest in taking up the vacant jobs. As they are working in the company for a long time, they know about the specification and description of the vacant job. For their benefit, the advertisement within the company circulates so that the employees will be intimated.

    Benefits of Internal Sources of Recruitment:
    • The existing employees get motivated.
    • Also, Cost saves as there is no need to give advertisements about the vacancy.
    • It builds loyalty among employees towards the organization.
    • The training cost is saved as the employees already know about the nature of the job to be performed.
    • It is a reliable and easy process.
    Limitations of Internal Sources of Recruitment:
    • Young people with the knowledge of modem technology and innovative ideas do not get the chance.
    • The performance of the existing employees may not be as efficient as before.
    • Also, The brings the morale down of employees who do not get the promotion or selected.
    • It may lead to encouragement to favoritism.
    • It may not be always in the good interest of the organization.

    External Sources of Recruitment:

    1. Press advertisement:

    A wide choice for selecting the appropriate candidate for the post is avail­able through this source. It gives publicity to the vacant posts and the details about the job in the form of the job description and job specification are made available to the public in general.

    1. Campus interviews:

    It is the best possible method for companies to select students from various educational institutions. Also, It is easy and economical. The company officials personally visit various institutes and select students eligible for a particular post through interviews. Also, Students get a good opportunity to prove themselves and get selected for a good job.

    1. Placement agencies:

    A databank of candidates is sent to organizations for their selection purpose and agencies get the commission in return.

    1. Employment exchange:

    People register themselves with government employment exchanges with their personal details. According to the needs and request of the organization, the candidates are sent for interviews.

    1. Walk in interviews:

    These interviews are declared by companies on the specific day and time and conducted for selection.

    1. E-recruitment:

    Various sites such as jobs.com, naukri.com, and monster.com are the available electronic sites on which candidates upload their resume and seek the jobs.

    1. Competitors:

    By offering better terms and conditions of service; Also, the human resource managers try to get the employees working in the competitor’s organization.

    Benefits of External Sources of Recruitment:
    • New talents get the opportunity.
    • Also, The best selection is possible as a large number of candidates apply for the job.
    • In case of unavailability of suitable candidates within the organization, it is better to select them from outside sources.
    Limitations of External Sources of Recruitment:
    • Skilled and ambitious employees may switch the job more frequently.
    • Also, It gives a sense of insecurity among the existing candidates.
    • It increases the cost as the advertisement is to be given through press and training facilities to be provided for new candidates.
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  • What is the Purpose and Importance of Recruitment?

    What is the Purpose and Importance of Recruitment?

    Importance of Recruitment; Recruitment means to estimate the available vacancies and to make suitable arrangements for their selection and appointment. The Concept of the study Explains – the Purpose and Importance of Recruitment: Need, Purpose, Importance, and Strategy. Recruitment is understanding as to the process of searching for and obtaining applicants for the jobs, from among whom the right people can select. Also learn, What is the Purpose and Importance of Recruitment?

    Understanding and Learn, What is the Purpose and Importance of Recruitment? with Need!

    Importance of a strong recruitment process: Successful recruitment is a direct reflection of the legitimacy and professionalism of your business. Employing the right people for your business is the most important part of your organization. It is necessary to have a good recruitment process to attract the right kind of staff for the needs of your business. Your recruitment process must be cost-effective as well as time-consuming. Recruitment and training can be expensive and time-consuming, so when you are recruiting, make sure that you are making the right choice.

    A good recruitment process can reduce the time involved in searching, interviewing, recruiting, and training. It can streamline these procedures and make your search more efficient for viable candidates. Also, Creating a positive image for your customers, peers, and competitors is very important. New employees must list the skills needed to fulfill their duties. To get better and successful results in your recruitment process, promote specific criteria relevant to the job.

    Always evaluate the skill of your candidate for the position of recruitment for knowledge, skill, and ability “KSA”, this is a great assessment tool for recruiting the right candidate for your business. There is no guarantee that your selection will be correct, but you can reduce your risks and maximize your ability to rent the right candidate. If you have a successful recruitment process then you can find a good, qualified, reliable staff for your company. Be sure to follow an organized recruitment path and you will find candidates who prove to be a great asset to your business.

    Need for Recruitment:

    Every Company in the world knows the importance of the recruitment step in increasing. Also, The performance of the company and increasing the productivity of the products. In this part of the project we will mention some important point about the importance of the recruitment step in any organization:

    • It helps the organization by finding the need for requirements by job analysis activities and personnel planning.
    • To collect many job candidates with less cost.
    • It helps to organize applications by dividing them by underqualified or overqualified, to increase the possibility of increasing and choosing the successful person to the right place.
    • Employing new and better-qualified staff often the only effective long-term strategy for improving operational performance.
    • Also, the Capabilities and commitment of employees ensure an organization’s success.
    • Raise organizational and individual value in the short term and long term.

    Purpose of Recruitment:

    • Determine current and future needs: To determine the present and future needs of the organization, with the combination of their plan and job analysis activities. Also, This is one of the most important objectives of recruitment.
    • Increase in the job pool: To increase the pool of job candidates at the minimum post cost.
    • Assistance in increasing success rate: To help increase the success rate of the selection process by reducing the visible number of under-qualified or exaggerated job applicants.
    • Help reduce the probability: To help reduce the likelihood of job applicants, once recruited and selected, only after a short period they can cure the organization.
    • Meet the organization’s social and legal obligation: it should fulfill the organization’s social and legal liability towards the combination of its employees
    • Start identifying job applicants: Identifying job applicants and preparing for potential job applicants will be suitable candidates.
    • Increase effectiveness: To increase organizational and personal effectiveness in the short-term and long-term.
    • Evaluate effectiveness: To evaluate the effectiveness of various recruitment techniques, all types of jobs are the source for the applicants. Also, This is the ultimate purpose of recruitment.

    The Purpose and Importance of Recruitment:

    Following a few points is explaining:

    • Determine the present and future requirements of the organization in conjunction with its personnel planning and job analysis activities.
    • Also, Increase the pool of job candidates at minimum cost.
    • Help increase the success rate of the selection process by reducing the number of visibly underqualified or overqualified job applicants.
    • Help reduce the probability that job applicants, once recruited and selected, will leave the organization only after a short period.
    • Meet the organization’s legal and social obligations regarding the composition of its workforce.
    • Begin identifying and preparing potential job applicants who will be appropriate candidates.
    • Also, Increase organizational and individual effectiveness in the short term and long term.
    • Evaluate the effectiveness of various recruiting techniques and sources for all types of job applicants.

    What is the purpose of the Recruitment Strategy?

    What is the issue of any strategy? A strategy defines big and important questions. Who, what, when, and why Who is doing when? And why are they doing this? Your recruitment strategy is hoped that the skilled use of company resources will be prepared to give your business the best talent to get a job. Also, Your strategy can generate productive benefits in your market!

    So, what’s the purpose? A recruitment strategy creates activation and clarity of purpose in the process of attracting and selecting talent for your business and aligns business goals with talent acquisition goals. Also, An employee strategy starts with understanding and understanding the value of your company to best understand and understand the behavior of those employees that you want to attract.

    A recruitment strategy clarifies the purpose or vision of the company for the future. A well-executed recruitment strategy will align employees with specific behaviors that are encouraged in the company.

    More to know…!

    A different purpose of deciding a recruitment strategy is how talent will be identified and business will be attracted, how the employer brand will be marketed for talent, and ultimately how it will be evaluated for employment for candidates. Attracting talent depends on your recruitment brand. How will you present your company and its brand authentically and describe it? Where do you propagate your company? Also, This is where good job descriptions, scorecards, job postings, recruitment techniques, and recruitment partners come into play.

    Today, no one can be the best in their entire strategy. Evaluating talent is also a big part of your recruitment strategy. Do you want your manager to talk with recruitment about how they get into the business and sell more about why your company is great? Or will you define the questions and role of your managers because you make the recruitment team? Always define team roles in evaluating talent. Also, Determine evaluation procedures and standards in continuous ways to attract and evaluate talent!

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  • Why are Training and Development required in HRM?

    Why are Training and Development required in HRM?

    The Concept of the study Explains – Training and Development required in HRM – Importance, advantages, disadvantages, and process. There is continuous pressure for efficiency and if the organization does not respond to this pressure, it may find itself rapidly losing its market.

    Understanding and Learn, Why are Training and Development required in HRM?

    Also, Training imparts skills and knowledge to employees so that they contribute to the organization’s efficiency and can cope with the pressures of a changing environment. Corporate Training at crazymonkeycafe.com.

    As well as, The viability of an organization depends to a considerable extent on the skills of different employees, especially that of the managerial cadre, to relate the organization to its environment. Therefore, in any organization, there is no question of whether to train its employees or not, the only choice is that of following a particular training and development method. Three factors that necessitate continuous training in an organization are technological advances, organizational complexity, and human relations. All these factors are related to each other.

    Training and development can play the following role in an organization.

    Increases Efficiency!

    Training and development increase skills for doing a job in a better way. This is more important in the context of changing technology because the old method of working may not be relevant. As such, training requires even to maintain a minimum level of output.

    Increases Morale!

    Training and development increase the morale of employees. High morale is evidenced by employee enthusiasm. Training increases employee morale by relating their skills with their job requirements. The Possession of skills necessary to perform a job well often tends to meet human needs such as security and ego satisfaction. Trained employees can see the jobs in a more meaningful way.

    Better Human Relations!

    Training increases the quality of human relations in an organization. The growing complexity of organizations has led to various human problems like inter-personal and inter-group problems. These problems can be overcome by suitable human relations training.

    Reduced Supervision!

    Trained employees require less supervision. Autonomy and freedom can be given if the employees are trained properly to handle their jobs without the help of supervision. With reduced supervision, a manager can increase his span of control in the organization which saves cost to the organization.

    Increased Organizational Viability and Flexibility!

    There is no greater organizational asset than trained personnel because these people can turn the other assets into a productive whole. Also, Viability relates to the survival of the organization during bad days and flexibility relates to sustaining its effectiveness despite the loss of its key personnel and making short-term adjustments with the existing personnel. Such adjustment is possible if the organization has trained people who can occupy the positions vacated by key personnel. The organization, which does not prepare a second line of personnel who can ultimately take charge of key personnel, may not be successful in the absence of such key personnel for whatever reason.

    Importance of Training and Development:

    For companies to keep improving, organizations need to have continuous training and development programs for their employees. Competition and the business environment keep changing, and hence it is critical to keep learning and picking up new skills. The importance of training and development is as follows:

    • Optimum utilization of Human resources
    • Development of skills
    • To increase the productivity
    • To provide the zeal of team spirit
    • For improvement of organizational culture
    • To improve quality, safety
    • To increase profitability
    • Improve the morale and corporate image
    Need for Training and Development:

    Training and development of employees is a costly activity as it requires a lot of quality input from trainers as well as employees. However, the company must revise its goals and efficiencies with the changing environment. Here are a few critical reasons why the company endorses training and development sessions.

    • When management thinks that there is a need to improve the performance of employees
    • To set up the benchmark of improvement so far in the performance improvement effort
    • To train about the specific job responsibility
    • To test the new methodology for increasing productivity
    Advantages of training and development:

    Training and development have a cost attached to it. However, since it is beneficial for companies, in the long run, they ensure employees stand trained regularly. Some advantages are:

    1. Helps employees develop new skills and increases their knowledge.
    2. Improves efficiency and productivity of the individuals as well as the teams.
    3. Proper training and development can remove bottlenecks in operations.
    4. New & improved job positions can be created to make the organization leaner.
    5. Keeps employees motivated and refreshes their goals, ambitions, and contribution levels.
    Disadvantages of training and development:

    Even though there are several advantages, some drawbacks of training and development are mentioned below:

    1. It is an expensive process that includes arranging the correct trainers and engaging employees for non-revenue activities.
    2. There is a risk that after the training and development session, the employee can quit the job.
    Training and Development Process:

    Training and development is a continuous process as the skills, knowledge, and quality of work need constant improvement. Since businesses are changing rapidly, companies must focus on training their employees after constantly monitoring them & developing their overall personality.

    The steps for training and development processes are:

    • Determine the need for training and development for individuals or teams
    • Establish specific objectives & goals that need to be achieved
    • Select the methods of training
    • Conduct and implement the programs for employees
    • Evaluate the output and performance post the training and development sessions.
    • Keep monitoring and evaluating the performances and again see if more training is required.

    Human resource management regards training and development as a function concerned with organizational activity aimed at bettering the job performance of individuals and groups in organizational settings. Training and development can be described as “an educational process which involves the sharpening of skills, concepts, changing of attitude and gaining more knowledge to enhance the performance of employees”. The field has gone by several names, including “Human Resource Development”, “Human Capital Development” and “Learning and Development”.

    Some explanations of training and development are some of the major HRM tasks:

    Most organizations see training and development as an integral part of human resource development activity. Centenary Turn has focused the same focus on organizations globally. Many organizations have made training hours mandatory for employees per year, keeping in mind the fact that technology is keeping employees at a very fast rate.

    So what is training and development? Is it really important for organizational existence or can they survive without prejudice? Training and development is one more thing or are they different? Training can be described as an effort to improve or improve additional qualifications or skills in an employee employed at present to increase performance or productivity.

    In technical training, there is a change in attitude, skill, or knowledge of a person with resultant improvement in practice. To be effective for the training, it should plan activities conducted entirely after analysis and goal after some qualifications, most importantly it is to organize in a learning environment.

    When designing a training program, it should keep in mind that both individual goals and organizational goals are kept in mind. Although it may not be possible to ensure sync, competencies are chosen in such a way that victory and win for the employee and organization are created.

    Generally, the organization prepares its training calendar at the beginning of financial training, where training needs stand identified for employees. This requirement of identification called ‘training requirement analysis’ is a part of the performance evaluation process. After the analysis, the number of training hours with training intervention was fixed, and it spread strategically in the following year.

    A better understanding of Development:

    Very time training with development is confusing, both components of the same system are different in some cases. The opportunities created to help growth workers grow. It is in the long run or the future in the future against the training, which focuses on the current job. It is not limited to the path of a job in the current organization but can also focus on other developmental aspects.

    In Gaudier, for example, employees are expected to participate in the training program on presentation skills essentially, though they are also free to choose a course on ‘Leadership approach through literature’. While the presentation skill program helps them on the job, literature-based programs can directly help them or not.

    Similarly, many organizations prefer some employees for the programs to develop them for future posts. This is done based on the current attitude, skills and abilities, knowledge, and performance of the employee. Most leadership programs are of this nature, with the view to making and nurturing leaders for tomorrow.

    Therefore, the major difference between training and development is that training stands often focused on current employee requirements or eligibility intervals, while development concerns itself with the preparation of people for assignments and responsibilities in the future.

    With technology, with more desk workers and industrial workers standing replaced by knowledge workers, training and development are at the forefront of HRD. In response to training and business needs, it is now in the Human Development Department to play an active leadership role.

    Why are Training and Development required in HRM - ilearnlot
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  • A Good Advertisement Copy: Features, Types, and Benefits

    A Good Advertisement Copy: Features, Types, and Benefits

    The advertisement copy refers to the written contents of the advertisement including its text and headline. This article explains about A Good Advertisement Copy with discussion by Features, Types, and Benefits. It can refer to as the heart of advertising and should draft with utmost care; otherwise, all the money invested in carrying out the advertisement campaign will go to waste.

    Explanation and Learn, A Good Advertisement Copy: Features, Types, and Benefits.

    In the words of William J. Stanton “The copy in an advertisement is defined as the written or spoken material in it, including the headline, coupons and advertiser’s name, and address as well as the main body of the message”. Simply stated advertisement copy means the total structure relating to the message which the advertiser wants to convey by using any medium of advertisement.

    The advertisement copy should prepare in such a manner as to leave ever­lasting impression on the reader. The job of drafting the copy should entrust to an expert. The reader should not only read but understand and believe the contents given in the advertisement copy.

    It should properly work and cover every detail about the product. Various considerations or essentials of a properly drafted advertisement copy are as under.

    The Concept of the study Explains – A Good Advertisement Copy: Features of a Good Advertisement Copy, Types of a Good Advertisement Copy, and Benefits of a Good Advertisement Copy.

    The Features or Characteristics of a Good Advertisement Copy:

    These also know as salient features or characteristics of a good advertisement copy.

    It Should Be Simple:

    The first important ingredient of an advertisement copy is that it should write in simple language. It should be capable of proper understanding. They should not use ornamental and tough words rather short, simple and properly understandable words.

    It Should Be Capable Of Holding The Reader’s Attention:

    An advertisement copy should be capable of holding the attention of the reader. It should present in such a manner which attracts the consumer immediately.

    The following methods may undertake to hold the attention of the reader:

    • Headlines should properly word and attractive. It should be short and easy for the reader to remember.
    • Use of pictures and sketches should be in direct relation to the product to advertise. A good sketch and drawing will be greatly helpful in explaining the product.
    • An attractive border may insert around the advertisement copy to distinguish it from other advertisements. Underlining the keywords and leaving blank space at the bottom of the copy is also helpful in drawing the reader’s attention.
    • Quoting the price of the product in the advertisement copy is also helpful in holding the attention of a reader. This would be more helpful if the price of the commodity is low.
    • The insertion of reply coupons in the advertisement copy is also helpful in attracting the people.
    It Must Be Suggestive:

    The advertisement copy should be capable of suggesting the reader about the utility and use of the product. Effective slogans can use to give suggestions to people. For example, in case of camp Cola, it is written in the advertisement copy that “life is full of camp cola times”, similarly in case of State Bank of India, it is advertised, “protect your future with State Bank of India”. All these slogans have suggestive value. Suggestions may also give with the help of certain pictures in the advertisement copy.

    It Should Have Conviction Value:

    The advertisement copy shall be able to have an everlasting impression on the reader if the suggestions are backed by convincing arguments. The reader should not have any doubt on the quality of the product. He should fully convince and satisfied. Exaggeration in explaining the qualities’ of a product must check. An appeal about the outstanding features of the product must make. It should state in simple language so that the reader could understand easily.

    In the case of Chelpark fountain pen ink, it is written that it cleans your pen while writing, contains clean x for better pen protection. Similarly in case of Forhan’s toothpaste, “it is ideal for the gums” and “protects your teeth” some organizations assure “money-back guarantee” to convince the people about the quality of the products.

    It Should Educate The People:

    The advertisement copy should tell the people about the use and operation of a product. It should also impart new uses of a product with which the people are not familiar. An advertisement copy containing information about the use, sources from where the product can obtain, price and services available along with the product is greatly helpful in enhancing the demand and enlarging the sales.

    For example, in the case of Hawkin’s pressure cooker, a booklet is also given to the buyer containing methods of preparing various vegetables, soups, and puddings, etc. with the help of the cooker. Similarly, in case of a refrigerator, a booklet containing various directions about proper use and preservation of the refrigerator are giving.

    It Should Have Memorising Value:

    The advertisement copy should prepare in such a manner that a reader gets the everlasting impression about the product. It can successfully create by repeating the advertisement time and again. Repetition projects the permanent image of the product on the reader’s mind. Trademarks and brand names can use successfully for achieving this end. Dalda, Thums-up, Bournvita, and Surf have successfully achieved memorizing value. The names of these products are very common among people.

    It Should Be True:

    An advertisement copy should be truthful. It should not misrepresent and conceal the facts about the product. Rather it should lay down the limitations in the product. For example, a cloth merchant should specify the fading of color and shrinkage of yarn, if it is so. If these limitations are not brought to light, the buyer eventually comes to know about them after using the product. This will shatter the confidence of the buyer in the product and the very aim of the advertisement defeat.

    Types of a Good Advertisement Copy:

    As told earlier, the method or style of presentation is to do with how the message presents. It speaks of the different types of advertising copies to arrest, inform, impress and impel the reader; certain elements are to be present in a copy such as attention, suggestion, meaning, conviction, sentiment, education, and instinct.

    Good Advertisement Copy is classifying in several ways in their types. However, the most practical one is to classify into six types as:

    • Institutional.
    • Reason why?
    • Human interest.
    • Educational.
    • Suggestive and.
    • Expository.

    Now, explain each one;

    Institutional Copy:

    Institutional Copy neither sells nor the products neither the service but the name of the business house. The aim is to build the sound edifice of a reputation for the selling house. It seeks to build goodwill through its philosophy, objectives, and policies towards public so that the prospects remember it.

    Reason Why Copy:

    Reason Why Copy offers reasons as to why the customer expects to buy a product or service of the advertiser. It appeals straight to the intellect or the judgment of an individual than emotion or impulses. It attempts to prove the product superiority using evidence in the forms of performance test, records, testimonials, guarantees and the like.

    Human Interest Copy:

    Human Interest Copy appeals to the emotional and the senses than intellect and the judgment, sympathy, affection, love, fear, humor, curiosity and other emotional appeals are used to the sense of sight, touch, taste, smell, and hearing.

    It tells about the product about the people instead of conforming to the facts about the products. It takes several forms of which four are very significant namely, “fear”, “humorous”, “story” and “predicament” copy.

    Suggestive Copy:

    Suggestive Copy tries to suggest or pinpoint or convey the message of the advertiser directly or indirectly to the readers. Much is left to the reader to infer the ad message. Like a poem, suggestive language is freely used where the hidden meaning is to pick by the readers. Such a copy can be “direct” or “indirect” suggestive copy. The first tells directly about the products or services of the company while the latter does indirectly.

    Expository Copy:

    Expository Copy is the open copy that exposes, unlike suggestive copy. It is so open that the facts are given in a very simple and clear way so that there is no need for interpretation. The information given is so clear and concise that hardly it takes the reader’s brain. It makes possible effortless grasp and acts.

    Advertisement Copy is the soul of an advertisement. An advertisement copy is all the written or spoken matter in an advertisement expressed in words or sentences and figures designed to convey the desired message to the target consumers.

    In print media, an advertisement copy is made-up of head-line, sub-headlines, the body of the copy, illustration logo-type, slogan, and the brand name. Strictly speaking, the written content of an ad copy is the product of the collective efforts of copy-writers, artists and the layout-men.

    As well as, Copywriter and artist must collaborate to provide an advertisement though copywriting precedes or succeeds the artwork and the layout.

    The Benefits of A Good Advertisement Copy:

    Whether a copy is effective or ineffective is a matter of personal judgment. It is very difficult to judge as its evaluation is purely subjective and perceptive. However, a good or effective copy is one that succeeds in reaching the target consumers to create favorable benefits towards the product and the producers, impelling an action on the part of the consumer to buy.

    A good advertisement copy has the following Benefits:

    It is brief:

    Brevity is the soul of wit. Most readers are interested in shorter advertisements. Being brief is not dropping words or chopping sentences. It is the meticulous work of eliminating and substituting the words without jeopardizing the meaning. This cuts to the core, it is to the point to cover all.

    It is clear:

    A clear copy is one which is easily and quickly read and grasped by the readers. It is unambiguous and self- explaining. It is one that clicks fast. Clarity gives clue to interpretation. How a copy is interpreted is dependent on factors like local traditions habits, customs, and nationality. Clarity adjusts to these points.

    It is apt:

    A copy is apt that matches the needs and counts of the prospects. Writing an apt copy is the art of putting in the words that create a strong desire to possess the product where the product features or the qualities satisfy the consumers’ desire to possess. The Copywriter is to place himself in the position of a customer to make it apt. He is to use the most suitable USP.

    It is personal:

    A personal copy is specific where generality dismisses to do away with ambiguity. A personalized copy centers on the prospect. It presents something of interest to the prospect. It’s an individualized appeal copy. It is written from “prospect” to “product” rather than “product” to “prospect”. The copy has “your attitude”.

    It is honest:

    Credibility or believability of an advertisement message is decided by the extent of honesty. An ad to be good must be truthful. Misleading and miss-presented facts made in the copy only damage the reputation of selling the house. One of the surest ways of winning the hearts of the consumers is, to be honest. “Honesty”, here, implies “commercial honesty” and not the “judicial”.

    It is conforming:

    Every ad copy is to conform to standards, rules, and regulations acceptable to the advertising media and the laws of the land. Anywhere in the world, no copy is acceptable to any media that offends the morality, declines decency and ravages religious susceptibilities of people.

    That is why; we have not come across ads on cigarettes and alcohols on radio and television. No advertiser can violate the provisions of the Act of Names and Emblems, Drugs Acts of 1940, 50, and 54.

    A Good Advertisement Copy Features Types and Benefits - ilearnlot
    A Good Advertisement Copy: Features, Types, and Benefits #Pixabay.