Tag: Process

  • What is the behavioral implication of Control? Perfect Explanation

    What is the behavioral implication of Control? Perfect Explanation

    The behavioral implication of Control; The control system should make as fair and as meaningful as possible and must be clearly communicating to all employees. It will be easier for the employees to accept control if they have to participate in the formulation of the control system and process of implementation. Though control should aim at satisfying the needs of the members of the organization, they often take it otherwise. This may be either because of the adverse real impact of control on them or because of Misperception of the impact of control.

    What is the behavioral implication of Control? Perfect Explanation.

    Managers must recognize several behavioral implications in the process of control and its implementation. Although an effective control system should aid in employee motivation, it can also have negative effects on employee morale and performance. Thus, while designing the control system, it must keep in mind that almost everybody in the organization not only resents the idea of being controlling but also objects to being evaluated. It means the results of the control may not same as anticipated by those who are exercising control.

    Behavioral implication of Control - List
    The behavioral implication of Control – List

    What are the Essentials of Effective Control System? The major behavioral problems of control can analyze by taking the nature of control, perception of those who are controlling, and action taken by them.

    Nature or Control:

    Control often puts pressure for engaging in desirable behavior by those who are subject to control. The basic question is: will they not behave in a desirable way if there is no control? Though opinions may differ on this question, often it is recognized that people engage in that behavior, which provides them satisfaction whether control or no control.

    It means if the organizational processes are in tune with the needs of the organizational participants, they can perform well in the absence of control and not in the presence of control. Behavioral scientists have concluded that people try to self-actualize but the basic problem, which comes in the way, is providing by the organization itself. They are inherently self-motivating.

    For example, McGregor believes that more people behave according to the assumptions of Theory Y as compared to Theory X. In such a case, if their behavior is controlled, it may be counter-productive for the organization. The results may be against organizational interests. Thus, the basic nature of control itself against the very basic nature of the people.

    However, this is not true in all cases. Many people may still behave according to the assumptions of Theory X and they need rigid control, In fact, the best control system may be one which focuses attention on the individual needs also, as discussed earlier, otherwise, it will provide more behavioral problems and may be detrimental to the organization itself.

    People or Perception:

    Another behavioral implication of control is the perception of people who are controlling. Though perception may be that control is against the nature of people, it is further aggravated by the fact that people perceive it to be for benefit of the organization but against them. Thus perception may be right or otherwise, that control if brings a better result, is sharing by the organization alone whereas it may, be brought by the organizational members.

    The control in most of the cases is using as a pressure tactic for increasing performance. This is true also because people may produce more if they are aware that their performance is being evaluated. However, increase performance is also determining by several other factors, most important or them being how it is sharing between the organization and its members.

    Thus, if they have a positive perception of this aspect also, they will engage in higher performance. In an alternative case, they will take certain actions to thwart the control action. There is another implication of people’s perception of control. The manager may develop some plan for control, but there are many un-planning controls also necessitated by the organizational requirements. Thus un-plan control is also the part of the organizational control.

    It is this un-plan control that has more serious repercussion and is more counter-productive. The participants may feel that it is due to improper planning on the part of management. Thus they are controlled not because of their own shortcomings but for the shortcomings of others. Naturally, this may be more serious for those who are controlling.

    Actions by Participants:

    Participants in most of the cases resist control attempt. In the first case, people may try to overcome the pressure from control through fanning group. People can stand only to a certain amount of pressure. After this point is pass, it becomes intolerable to them and they will try to find out the alternatives.

    One of the alternatives is the formation of the group if people cannot reduce the pressure individually. The group helps them to absorb much of the pressure and thus relieves the individual personality. It gets rid of the tension generated by the control and people feel more secure by belonging to a group, which can counteract the pressure.

    They will try to escape from the purview of control and may take several actions:

    • Control may try to bring behavior which is satisfying to them but not necessarily satisfying to the organization.
    • They may engage in a behavior which may appear to be in conformity with organizational requirements but actually, it is not, and.
    • If these are not possible they may try to engage in behavior as required by the organization.

    Now the question is:

    Does the group disappear if the control pressure is off?

    The answer is generally in negative because, by the time, control pressure is oft, people have socialized and identify with a particular group and the group has become attractive to them in more than one respect. Thus, they are likely to continue to be the members of the group even after the control pressure is off. Another alternative of overcoming the pressure of control is that an individual solves it at his own level.

    This happens more so if control pressure affects only a few individuals. In such cases, the individuals may engage in a behavior, which on the surface seems to satisfy organizational needs but actually, it is not so. In such cases, they will try to camouflage the information meant for control like providing wrong information or coming in time at the work-place but not quite engaging in meaningful behavior or looking busy but without doing anything. This situation is also quite counterproductive.

    If the individuals are not able to go for any of these alternatives. They will fall in line with organizational control attempt. This situation may, however, not take as an ideal because it may be counter-productive in the logs run; People may develop alienation to the work and to the organization which may have an adverse effect on their efficiency. Organization in such cases may lose, not only the efficiency of their members but them also.

    What is the behavioral implication of Control Perfect Explanation
    What is the behavioral implication of Control? Perfect Explanation #Pixabay.

    Behavioral Implications in the Process of Control:

    Some of the behavioral implications of control are as follows:

    • Controls may influence the generation of invalid and inaccurate information. For example, if the top management habitually reduces budget requests when reviewing them (a control activity), then the lower management, when proposing a new budget or a new project may overstate the cost of resources needed. Similarly, managers may set objectives lower than what is attainable so that higher output will look better at performance appraisal time.
    • Controls can resent by employees if they have no control over the situation. For example, if a professor’s performance is appraising over the number of publication of books and research articles. But he is not affording the freedom of time to do so because of heavy teaching loads and excessive committee work. Then it can result in frustration which may be detrimental to the entire control system. Similarly, the manager will become highly frustrated. If his performance evaluation is based upon profits achieved by his department. But he does not have the authority and control to make operational changes such as hiring and firing of workers.
    • The control system must synchronize to create a balance among all affecting and inter-connected variables. The standards should complement each other and not contradict each other. For example, a control system which emphasizes increased sales as well as a reduction in advertising expenditure at the same time. May seem contradictory to the marketing manager and thus may be frustrating for him.
  • Capital Formation: Significances, Process, Stages, and also Meaning

    Capital Formation: Significances, Process, Stages, and also Meaning

    What does Capital Formation Mean? Capital formation means increasing the stock of real capital in a country. The following points highlight the Capital Formation: Significances, Process, Stages, and also Meaning; Significances of Capital Formation, Process of Capital Formation, Stages of Capital Formation, and Meaning of Capital Formation! Capital-formation refers to all the produced means of further production, such as roads, railways, bridges, canals, dams, factories, seeds, fertilizers, etc. Read and share the given article in English. Understand the Indian Capital Market!

    Explain and Introduction to Capital Formation.

    In other words, capital formation involves making more capital goods such as machines, tools, factories, transport equipment, materials, electricity, etc., which are all used for the future production of goods. For making additions to the stock of Capital, saving and investment are essential.

    #Meaning of Capital Formation:

    Capital-formation or accumulation plays a predominant role in all types of economics whether they are of the American or the British type, or the Chinese type. Development is not possible without capital-formation.

    According to Professor Nurkse,

    “The meaning of (Capital Formation) is that society does not apply the whole of its current productive activity to the needs and desires of immediate consumption, but directs a part of it to the tools and making of capital goods: tools and instruments, machines and transport facilities, plant and equipment— all the various forms of real capital that can so greatly increase the efficacy of productive effort. The essence of the process, then, is the diversion of a part of society’s currently available resources to the purpose of increasing the stock of capital goods so as to make possible an expansion of consumable output in the future.”

    Saving and investment are essential for capital formation. According to Marshall, saving is the result of waiting or abstinence. When a person postpones his consumption to the future, he saves his wealth which he utilizes for further production, If all people save like this, the aggregate savings increase which is utilized for investment purposes in real capital assets like machines, tools, plants, roads, canals, fertilizers, seeds, etc.

    But savings are different from hoardings. For savings to be utilized for investment purposes, they must be mobilized in banks and financial institutions. And the businessmen, the entrepreneurs, and the farmers invest these community savings on capital goods by taking loans from these banks and financial institutions.

    #The Top significance of Capital the Formation:

    Capital formation or accumulation is regarded as the key factor in the economic development of an economy. The vicious circle of poverty, according to Prof. Nurkse, can easily be broken in underdeveloped countries through capital formation.

    It is the capital formation that accelerates the pace of development with fuller utilization of available resources. As a matter of fact, it leads to an increase in the size of national employment, income, and output thereby the acute problems of inflation and balance of payment.

    The following top Significance below is:

    Use of Human Capital Formation:

    Capital formation plays an extraordinary role in the qualitative development of human resources. Human capital formation depends on people’s education, training, health, social and economic security, freedom and welfare facilities for which sufficient capital in needed.

    Labor force needs up-to-date implements and instruments is sufficient quantity so that with the increase in population there will be an optimum increase in production and increased labor is easily absorbed.

    Improvement in Technology:

    In underdeveloped countries, capital formation creates overhead capital and necessary environment for economic development.

    This helps to instigate technical progress which makes impossible the use of more capital in the field of production and with an increase of capital in production, the abstract form of capital changes.

    It is seen that present changes in the capital structure lead to changes in the structure and size of technique and public is thereby more influenced.

    High Rate of Economic Growth:

    The higher rate of capital formation in a country means the higher rate of economic growth. Generally, the rate of capital formation or accumulation is very low in comparison to advanced countries.

    In the case of poor and underdeveloped countries, the rate of capital formation varies between one percent to five percent while in the latter’s case, it even exceeds 20 percent.

    Agricultural and Industrial Development:

    Modern agricultural and industrial development needs adequate funds for the adoption of the latest mechanized techniques, input, and setting of different heavy or light industries.

    Without sufficient capital at their disposal, leads to a lower rate of development thus, capital formation. In fact, the development of these both sectors is not possible without capital accumulation.

    Increase in National Income:

    Capital formation improves the conditions and methods for the production of a country. Hence, there is much increase in national income and per capita income. This leads to an increase in the quantity of production which leads to again rise in national income.

    The rate of growth and the quantity of national income necessarily depends on the rate of capital formation.

    So, the increase in national income is possible only by the proper adoption of different means of production and productive use of the same.

    Expansion of Economic Activities:

    As there is an increase in the rate of capital formation, productivity increases quickly and available capital is utilized in a more profitable and extensive way. In this way, complicated techniques and methods are utilized for the economy.

    This results in the expansion of economic activities. Capital formation increases investment which effects economic development in two ways.

    Firstly, it increases the per capita income and enhances the purchasing power which, in turn, creates a more effective demand.

    Secondly, investment leads to an increase in production. In this way, by capital formation, economic activities can be expanded in underdeveloped countries, which in fact, helps to get rid of poverty and attain economic development in the economy.

    Less Dependence on Foreign Capital:

    In underdeveloped countries, the process of Capital formation increases dependence on internal resources and domestic savings by which dependence on foreign capital is declined.

    Economic development leaves the burden of foreign capital, hence to give interest to foreign capital and bear expenses of foreign scientists, the country has to be burdened by improper taxation to the public.

    This gives a setback to internal savings. Thus, by the way of capital formation, a country can attain self-sufficiency and can get rid of foreign capital’s dependence.

    Increase in Economic Welfare:

    By the increase in the rate of capital formation, the public is getting more facilities. As a result, the common man is more benefited economically. Capital formation leads to an unexpected increase in their productivity and income and this improves their standard of living.

    This leads to improvement and enhancement in the chances of work. This helps to raise the welfare of the people in general. Therefore, capital formations the principal solution to the complex problems of poor countries.

    Capital Formation Significances Process Stages and also Meaning
    Capital Formation: Significances, Process, Stages, and also Meaning! Image credit from #Pixabay.

    #The Top 3 Process of Capital Formation:

    The process of capital formation involves three steps:

    1. Increase in the volume of real savings.
    2. Mobilization of savings through financial and credit institutions, and.
    3. Investment of savings.

    Thus the problem of capital formation becomes two-fold: one, how to save more; and two, how to utilize the current savings of the community for capital formation. We discuss the factors on which capital accumulation depends.

    1. How to Increasing Savings?

    The following savings below are:

    Power and Will to Save: 

    Savings depend upon two factors: the power to save and the will to save. The power to save the community depends upon the size of the average income, the size of the average family, and the standard of living of the people.

    Highly progressive income and property taxes reduce the incentive to save. But low rates of taxation with due concessions for savings in provident fund, life insurance, health insurance, etc. encourage savings.

    The perpetuation of Income Inequalities: 

    A perpetuation of income inequalities had been one of the major sources of capital formation in 18th century England and early 20th century Japan. In most communities, it is the higher income groups with a high marginal propensity to save that do the majority of savings.

    Increasing Profits: 

    Professor Lewis is of the view that the ratio of profits to national income should be increased by expanding the capitalist sector of the economy, by providing various incentives and protecting enterprises from foreign competition. The essential point is that the profits of business enterprises should increase because they know how to use them in productive investment.

    Government Measures: 

    Like private households and enterprises, the government also saves by adopting a number of fiscal and monetary measures. These measures may be in the form of a budgetary surplus through an increase in taxation (mostly indirect), reduction in government expenditure, expansion of the export sector, raising money by public loans, etc.

    2. How to Mobilization can Savings?

    The next step for capital formations the mobilization of savings through banks, investment trusts, deposit societies, insurance companies, and capital markets. “The Kernal of Keynes’s theory is that decisions to save and decisions to invest are made largely by different people and for different reasons.”

    To bring the savers and investors together there must be well-developed capital and money markets in the country. In order to mobilize savings, attention should be paid to the starting of investment trusts, life insurance, provident fund, banks, and cooperative societies.

    Such agencies will not only permit small amounts of savings to be handled and invested conveniently but will allow the owners of savings to retain liquidity individually but finance long-term investment collectively.

    3. How to Investment can Savings?

    The third step in the process of capital formations the investment of savings in creating real assets. The profit-making classes are an important source of capital formation in the agricultural and industrial sectors of a country.

    They have an ambition for power and save in the form of distributed and undistributed profits and thus invest in productive enterprises, besides, there must be a regular supply of entrepreneurs which are capable, honest and dependable. To these may be added, the existence of such infrastructure as well-developed means of transport, communications, power, water, educated and trained personnel, etc.

    #The Top 3 Stages of Capital Formation:

    The following stages below are:

    Creation of savings:

    Capital formation depends on savings. Saving is that part of national income which is not spent on consumption goods. Thus, if national income remains unchanged more saving implies less consump­tion. In other words, in order to save more and more people have to curtail their consumption voluntarily.

    If people reduce their consumption savings will increase. If consumption falls some resources used in the production of consumption goods will be released. The creation of money-savings in a country depends mainly on the people’s ability to save and partly on their willingness to save.

    Conversion of savings into investment:

    However, generation of sav­ings is not enough. Often people save money but this saving largely goes waste because saving is held in the form of idle balance (as in rural areas), or to purchase unproductive assets like gold and jewelry. This is why society’s actual savings falls below its potential savings. Thus, the genera­tion of savings is just a necessary and not a sufficient condition of capital formation.

    The actual production of capital goods:

    This stage involves the con­version of money-savings into the making of capital goods, or what is known as investment. The latter, in turn, hinges on the existing technical facilities available in the country, existing capital equipment, entrepreneurial skill, and venture, the rate of return on investment, the rate of interest, govern­ment policy, etc. 

    Thus the third stage of capital formations concerned with the actual production of capital goods. The process of capital formation is not complete unless business firms acquire capital goods so as to be able to expand their production capacity.

  • Integrated Marketing Communications (IMC): Definition, Components, and its Process

    Integrated Marketing Communications (IMC): Definition, Components, and its Process

    What is IMC? Integrated Marketing Communications (IMC) is a marketing concept of the 1990s. It will be necessary for survival in the 21st century. It ensures that all forms of communication and messages are carefully linked together. The topic of this article: IMC Meaning, Definition, Components, and its Process. At its most basic level, Integrated Marketing Communications, or IMC, as we’ll call it, means integrating all the promotional tools, so that they work together in harmony. Read and share it in English!

    Introduction of Integrated Marketing Communications (IMC) Explanations!

    The advent of integration is causing marketers to take a fresh look at all the components of marketing, specifically the unique dimension that public relations bring to the marketing mix. Public relations people, in turn, are seizing the opportunity that integration offers them to make a difference where it counts most to their companies and clients – on the bottom line.

    IMC is the culmination of the shift that began in the post – World War II period, from selling what the companies make to making what the consumers want. IMC focused on what to know about products and services, not what the marketers want to tell them in order to sell them.

    Meaning and Definition of Integrated Marketing Communications (IMC):

    It is essential for organizations to promote their brands well among the end-users not only to outshine competitors but also to survive in the long run. Brand promotion increases awareness of products and services and eventually increases their sales, yielding high profits, and revenue for the organization.

    Integrated Marketing Communication defined as the coordination and integration of all marketing communication tools, avenues, and sources within a company into a seamless program that maximizes the impact on customers and other end-users at a minimal cost.

    This integration affects all firm business-to-business, marketing channels, customer-focused, and internally directed communications. It is a management concept that is designed so that all the marketing communication which consists of advertising, sales promotion, public relation, and direct marketing work together as a unified force rather than each of those marketing communication work in isolation.

    Besides, it acts as an aggressive marketing plan because it sets and tracks marketing strategy that captures and uses the extensive amount of customer information. It also ensures that all forms of communication and messages carefully linked together to achieve a specific objective.

    Definitions of Integrated Marketing Communications (IMC):

    The American Association of Advertising Agencies (AAAA), defines it as:

    “A concept of marketing communication planning that recognizes the added value of a comprehensive plan that evaluates the strategic roles of a variety of communication disciplines, e.g. general advertising, direct response, sales promotion and public relations – and combines these disciplines to provide clarity, consistency and maximum communication impact.”

    The Northwestern University’s Medill School of Journalism defines IMC as,

    “The process of managing all sources of information about a product/service to which a customer or prospect is exposed which behaviorally moves the customer toward the sale and maintains customer loyalty.”

    According to Kotler and Armstrong, Integrated Marketing Communications (IMC) is a concept in which a:

    “Company carefully integrates and coordinates its many communication channels—mass media advertising, personal selling, sales promotion, public relations, direct marketing, packaging, and others—to deliver a clear, consistent, and compelling message about the organization and its products.”

    Integrated Marketing Communication according to Schultz and Kitchen,

    “Is a strategic business process used to plan, develop, execute, and evaluate co-ordinated measurable, persuasive brand communication programs over time with consumers, customers, prospects and other targeted, relevant external and internal audience.”

    Tom Duncan defined IMC as,

    “A process for managing the customer relationships that drive brand value. More specifically, it is a cross-functional process for creating and nourishing profitable relationships with customers and other stakeholders by strategically controlling or influencing all messages sent to these groups and encouraging data-driven, purposeful dialogue with them.”

    In short, Integrated Marketing Communications (IMC) is:

    “Joint planning, execution, and coordination of all areas of marketing communication and also understanding the consumer and what the consumer actually responds to.”

    The Components of Integrated Marketing Communication:

    Let us go through various components of Integrated Marketing Communication:

    The Foundation:

    As the name suggests, the foundation stage involves a detailed analysis of both the product as well as the target market. It is essential for marketers to understand the brand, its offerings, and end-users. You need to know the needs, attitudes, and expectations of the target customers. Keep a close watch on competitor’s activities.

    Corporate Culture:

    The features of products and services ought to be in line with the work culture of the organization. Every organization has a vision and it’s important for the marketers to keep in mind the same before designing products and services. Let us understand it with the help of an example. Organization A’s vision is to promote a green and clean world. Naturally, its products need to be eco-friendly and biodegradable, in line with the vision of the organization.

    Brand Focus:

    Brand Focus represents the corporate identity of the brand.

    Consumer Experience:

    Marketers need to focus on consumer experience which refers to what the customers feel about the product. Also, a consumer is likely to pick up a product that has good packaging and looks attractive. Products need to meet and exceed customer expectations.

    Communication Tools:

    Communication tools include various modes of promoting a particular brand such as advertising, direct selling, promoting through social media such as Facebook, Twitter, Orkut, and so on (Note: Orkut is no longer use it).

    Promotional Tools:

    Brands are promoted through various promotional tools such as trade promotions, personal selling, and so on. Organizations need to strengthen their relationship with customers and external clients.

    Integration Tools:

    Organizations need to keep a regular track of customer feedback and reviews. You need to have specific software like customer relationship management (CRM) which helps in measuring the effectiveness of various integrated marketing communications tools.

    Integrated marketing communication enables all aspects of the marketing mix to work together in harmony to promote a particular product or service effectively among end-users.

    Integrated Marketing Communications (IMC) Definition Components and its Process
    Integrated Marketing Communications (IMC): Definition, Components, and its Process!

    IMC (Integrated Marketing Communications) Process:

    The following process below are;

    Identify target audience:

    The promotional process must start by identifying the target audience by using segmentation; which is defining buying preferences and characteristics of buyers and dividing them into segments. Also, the goal of identifying target audiences is to design promotional strategies that can meet customer expectations more accurately.

    Thus, IMC which integrating and coordinating all types of marketing promotional tools; that maximize the satisfaction of buyers will be very useful to the firm’s promotional strategies. This is because IMC can help the company by providing customer databases to sellers; and, marketers to identify information about the buyers precisely and accurately.

    Determine the communication objectives:

    In the second stage, the company needs to develop a clear objective and the goals of promotional strategies. As well as, the objectives of promotional strategies include creating products and services awareness in the buyers’ minds; developing competitive advantages against competitors; creating brand equity of buyers, retaining current buyers, and changing buyers’ behaviors.

    Meanwhile, Integrated Marketing Communication (IMC) develops different types of promotional tools; which have contained different functions to achieve the communication objectives of the promotional strategies effectively and efficiently.

    Design messages:

    An effective message will get the attention of buyers and maintain their interest in the messages about their brand of products. Therefore, the promotional team of a firm should implement IMC when designing the messages delivered to each segment in order for the messages to deliver effectively.

    Although a tailored message for each target segment designed by using several promotional tools in the IMC process; but, the messages of promotions must have the same meaning and theme. This is because each of the promotional tools must use to achieve the same communication objectives and goals within the firm.

    Implementation of a promotional strategy:

    Promotional channels can divide into two categories, which consist of personal communication and non-personal communication channels. So when incorporated IMC into the promotional strategy, it needs to select and implement the right marketing channels and methods.

    No single channel can dominate in all aspects; which means that the channels need to adjust based on the market’s needs and changes from time to time. This has proven that IMC which integrating and coordinating all types of marketing promotional channels can be very useful; when it comes to the implementation of the promotional strategy process.

    Collecting feedback:

    Finally, the firms will carry out some surveys in order to get some feedback from; the target audience as the final step in the IMC process. For example, the firm will ask how effectively the message was delivered to the target audience; such as how many times the audience saw the advertisement, or can the audience remember; what the message marketers are going to inform and etc.

    Based on that, the firm will conduct a report about the behavior resulting from the message, such as how many of the target audiences buy the product or visit the store after they saw the advertisement. This information could be very important to the firm promotional strategies as; it could directly affect the volume of sales, profits, and indirectly reflect; the success of the promotional strategies that had been implemented. Hence, all this information can get from the customer database to create more accurate and reliable feedback.

    References:

    • mbaknol.com/marketing-management/introduction-to-integrated-marketing-communications-imc/
    • managementstudyguide.com/integrated-marketing-communications.htm
  • How to Analysis of Capitalism in India?

    How to Analysis of Capitalism in India?

    What is Capitalism? In the capitalist economic system, all farms, factories and other means of production are the property of private individuals and firms. In the words of Loucks, “Capitalism is a system of economic organization featured by private ownership and use for private profit of man-made and nature-made capital”. So, what is the question we are going to discuss; How to Analysis of Capitalism in India?

    Here are explained; Capitalism in India: first Features, Growth, Process, and finally Social.

    Definition; According to Wright, “Capitalism is a system in which, on average, much of the greater portion of economic life and particularly of net new investment is carried on by private (i.e. non-government) units under conditions of active and substantially free competition and avowedly at the least, under the incentive of hope for profit”.

    The Features of Capitalism:

    In the broadest sense, capitalism may be defined as the economic system making the widest use of capital in the process of production. In the technical sense, capitalism may be defined as the economic system of production in which capital goods are owned privately by individuals or corporations.

    The principal features of capitalism are discussed below; key points.

    • Private Property.
    • Profit Motive.
    • Price Mechanism.
    • Role of the State.
    • Market Economy.
    • Consumer Sovereignty.
    • Freedom of Enterprise.
    • Large Scale Production, and.
    • Competition.

    The following are the economic bases of capitalism, now explain each below:

    Private Property:

    Capitalism thrives on the institution of private property. It means that the owner of a firm or factory or mine may use it in any manner he likes. He may hire it to anybody, sell it, or lease it at will in accordance with the prevalent laws of the country. The state’s role is confined to the protection of the institution of private property through laws.” The institution of private property induces its owner to work hard, to organize his business efficiently and to produce more, thereby benefiting not only himself but also the community at large. All this is actuated by the profit motive.

    Profit Motive:

    The main motive behind the working of the capitalist system is the profit motive. The decisions of businessmen, farmers, producers, including that of wage-earners are based on the profit motive. The profit motive is synonymous with the desire for personal gain. It is this attitude of acquisitiveness which lies behind individual initiative and enterprise in a capitalist economy.

    Price Mechanism:

    Under capitalism, the price mechanism operates automatically without any direction and control by the central authorities. It is the profit motive which determines production. Profit being the difference between outlay and receipt, the size of profit depends upon prices. The larger the difference between prices and costs, the higher is the profit. Again, the higher the prices, the greater are the efforts of the producers to produce the varied quantities and types of products. It is the consumers’ choices which determine what to produce, how much to produce, and how to produce. Thus capitalism is a system of mutual exchanges where the price-profit mechanism plays a crucial role.

    Role of the State:

    During the 19th century, the role of the state was confined to the maintenance of law and order, protection from external aggression, and provision for educational and public health facilities. This policy of laissez-faire—of non-intervention in economic affairs by the state—has been abandoned in capitalist economies of the West after the Second World War. Now the state has important tasks to fulfill. They are monetary and fiscal measures to maintain aggregate demand; anti-monopoly measures and nationalized monopoly corporations; and measures for the satisfaction of communal wants such as public health, public parks, roads, bridges, museums, zoos, education, flood control, etc.

    Market Economy:

    Under capitalism, there is no governmental control over the forces of production, distribution, and exchange. It is controlled by the forces operating in the market. There is no price control or regulated distribution by the government. The economy operates freely under the law of demand and supply. The capitalist economy is a liberalized or market economy.

    Consumer’s Sovereignty:

    Under capitalism, ‘the consumer is the king.’ It means freedom of choice by consumers. The consumers are free to buy any number of goods they want. Producers try to produce a variety of goods to meet the tastes and preferences of consumers. This also implies freedom of production whereby producers are at liberty to produce a vast variety of commodities in order to satisfy the consumer who acts like a ‘king’ in making a choice out of them with his given money income. These twin freedoms of consumption and production are essential for the smooth functioning of the capitalist system.

    Freedom of Enterprise:

    Freedom of enterprise means that there is the free choice of occupation for an entrepreneur, a capitalist, and a laborer. But this freedom is subject to their ability and training, legal restrictions, and existing market conditions. Subject to these limitations, an entrepreneur is free to set up any industry, a capitalist can invest his capital in any industry or trade he likes, and a person is free to choose any occupation he prefers. It is on account of the presence of this important feature of freedom of enterprise that a capitalist economy is also called a free enterprise economy.

    Large Scale Production:

    It is another important feature of capitalism. Capitalism arose as a result of the industrial revolution which made large-scale production possible. The installation of gigantic plants and division of labor increased production. More production means wider use of capital and led to more profits.

    Competition:

    Competition is one of the most important features of a capitalist economy. It implies the existence of a large number of buyers and sellers in the market who are motivated by self-interest but cannot influence market decisions by their individual actions. It is competition among buyers and sellers that determine the production, consumption, and distribution of goods and services. There being sufficient price flexibility under capitalism, prices adjust themselves to changes in demand, in production techniques, and in the supply of factors of production. Changes in prices, in turn, bring adjustments in production, factor demand, and individual incomes.

    How to the Growth of Capitalism in India?

    In primitive societies the usual system of exchanging goods vas barter system. At that time the idea of profit did not exist, ‘people accumulated goods not for making a profit during the days of scarcity but to gain prestige. The system of trading often consisted if giving and mutual rendering of services. Economic factors such as wages, investment; interest and profit were practically unknown preliterate societies. During the early Middle Ages, trade and commerce were little more advanced than they had been among the primitive peoples.

    While at first conducted largely on a barter basis, trading came gradually more and more to involve money as a medium of exchange. This gave a fillip to the development of trade and commerce which gave importance to money, gold, silver, and tokens thereof. Money is not property, it is a symbol of property; it has a profound influence on the uses to which productive properties are put. According to Simmel, the establishment of the institution of money in the economic system of modern western society has had far-reaching effects upon almost every phase of life.

    It resulted in greater freedom for both the employer and employee and for both the seller and buyer of goods and services since it makes for the depersonalized relationship between the two parties in a transaction. Simmel maintains that the institution of money has radically changed our whole philosophy of life. It has made us pecuniary in our attitudes so that everything is evaluated in terms of money, and as social contacts have become depersonalized, human relations have become superficial and cold.

    In the early part of the modern period, the economic activities were generally regulated by the governing powers. It was an economic reflection of the growing unification of European peoples under strong monarchical Governments. The interest of the secular rulers lay in internal unification and this necessarily meant economic as well as political integration. The mercantilist ideology dominated the period. The economic activities of the people were politically regulated to increase the profits of the king and to fill his treasury with wealth.

    The nation was looked upon by the mercantilist as an economic organization engaged in the making of profit. The ownership and use of productive properties were minutely regulated by mercantilist’s law. Then came the Industrial Revolution which changed the techniques of production. The policy of mercantilism also had failed to bring about the welfare of the people. To secure maximum production of usual goods the new do “trine of ‘Laissez-faire’ was propounded.

    The doctrine preached non- interference in economic matters. According to this doctrine, if individuals pursue their own interest, unhampered by restriction; they will achieve the greatest happiness of the greatest number. Its advocates, Adam Smith, J.S. Mill, Spencer, and Sumner contended that Government should remove all legal restrictions on trade, on production, on the exchange of wealth and on the accumulation of property.

    Adam Smith enunciated four principles:
    • The doctrine of self-interest.
    • Laissez-faire policy.
    • The theory of competition, and.
    • Profit motive.

    Upon these principles and in response to the changing techniques of production brought about by the Industrial Revolution, a new system of property ownership and ‘production’, capitalism developed. The Industrial Revolution replaced factories in place of households. In factories, the work was divided up into little pieces, each worker doing a little piece. Production increased. Large plants in -course of time were set.

    Corporations owning large plants came into being. All these developments of mass production, the division of labor, specialization, and exchange were accompanied by capitalism. In this new system of production and exchange, the ownership of productive properties was both individualized and divested of all social responsibility.

    The Property became private and was freed from all obligations to the state, church, family and other institutions. The owners of the factory were free to do as they pleased. Profit was the main motive for them. They were under no obligation to produce goods if they believed that they could not make the profit. The mode of production was profit-oriented and the Governments in adherence to the doctrine of Laissez-faire supported the owners in this right.

    How to understand Capitalism as a Process?

    With the growth of the capitalist system there was:

    • Extreme polarization of classes.
    • Pauperization.
    • Alienation.
    • Dehumanization of Labor.
    • The dictatorship of the proletariat, and.
    • Shift from Capitalism to Socialism.

    Marx’s sociology of capital in capitalist societies is not applicable to so many capitalist societies. This is the” case particularly with the Asiatic societies which do not show any class conflict in-spite of social stratification.

    In the words of Raymond Aron,

    “For one thing the Marxist conception of capitalist society and of society, in general, is sociological but this sociology is related to philosophy, and a number of interpretative difficulties arise from the relation of philosophy to sociology.”

    Hence Marx’s predictions about the downfall of capitalism have not come true everywhere. His idea of constant pauperization of Labour is wrong so far as Western societies are concerned. Neither is there any proof of Proletaization. The claim of the destruction of capitalism is inevitable is far from being scientific.

    How to Analysis of Capitalism in India
    How to Analysis of Capitalism in India? Old Two Rupees Coin, Image credit from #Pixabay.

    What do the Social Consequences of Capitalism?

    Capitalism or economic development has brought in some good consequences which are as follows:

    • Economic Progress: Capitalism has led men to exploit the natural resources more and more. The people exert themselves utmost for earning money. This had led to many inventions in the field of industry, agriculture, and business which have contributed to economic progress.
    • Exchange of Culture: Capitalism has led to international trade and exchange of know-how. People in different countries have come nearer to each other. The development of the means of transport and communication has facilitated contacts among the peoples of the world thereby leading to exchange of ideas and culture.
    • High Standard of Living: Capitalism is the product of industrialization. Industrialization has increased production. Now men do not have to toil for bread as they used to do in the primitive days. The necessities of life are easily available.
    • The progress of Civilization: Capitalism was instrumental in inventing new machines and increasing the production of material goods. Man is to-day more civilized than his ancestors.
    • Lessening of Racial Differences: Capitalism has also led to the lessening of differences based on race, creed, caste, and nationality. In the factory, the workers and officials belonging to different castes co-operate with one another and work shoulder to shoulder. Inter-mixing of castes is the off-shoot of capitalism.

    But in spite of the above good consequences capitalism has proved a curse instead of a blessing.

    Its bad effects are the following:
    • Imbalance in Social System: Capitalism has led to an imbalance in the social system. It has failed to adjust itself to the welfare of society. It has widened the gap between the haves and have-not’s and created insatiable greed for wealth among the people. It has changed the very outlook of human beings. Wealth has become an important criterion of status.
    • Artificiality: Capitalism has transformed modern culture into mere artificiality. Today there is a false courtesy. One does not find gentility and human touch. One can see false prestige, mere artificiality, and sheer advertisement even in art and literature, nothing to speak of diet, dress, and speech etc. Life today has become artificial.
    • Greed for Wealth: Capitalism is based on greed for wealth It has raised wealth to the pedestal of deity. Wealth has become the be-all and end-all of human life. The modern man is mad after wealth. He wants to earn more and more wealth by any means. The idea for morality does not enter into the means of earning. It has thus led to moral degeneration.
    • Destruction of Human Values: In a capitalist order, everything has come to be measured in terms of wealth. All values of human life such as love, sympathy, benevolence, love, and affection are evaluated in terms of silver coins. Every person wants to get the maximum. The sole criterion is wealth, not value.
    • Materialism: Capitalism manifests materialism in its extreme form. Religion and spirituality lose their force. Religion becomes the opium of people. Religion becomes hypocrisy. The big capitalists save lacs of rupees by way of tax through contribution to fictitious charitable institutions. While people are short of goods, the capitalists hoard them to soar the prices.
    • Emphasis on Sex: Capitalist culture lays emphasis on sex. Marriage has become a mere agreement for the satisfaction of sex hunger. The capitalists advertise their goods through the display of sex instincts. Literature and movies are based on sexual passion. Pre-marital and extra-marital sexual relations are on the increase. Man is lacking in self-control.

    It has led to the moral degeneration of man. Obviously, capitalism has failed to bring about the moral development of man. It is injurious both to society and the individual. In short, it has proved a curse to humanity instead of a blessing. Karl Marx was its bitter critic.

  • 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, Benefits, and Objectives of Career Planning

    Meaning, Definition, Benefits, and Objectives of Career Planning

    Career Planning; Career planning encourages individuals to explore and gather information, which enables them to syn­thesize, gain competencies, make decisions, set goals and take action. Meaning: Career is seen as a collection of bunch or jobs or posts. Generally, it describes an applies career path within the organization’s structure. It shows the development path of key personnel within the organization. The derivation of the word derived from the Latin word carrier, which means running. Do you study to learn: If Yes? Then read the lot. Let’s Study: Meaning, Definition, Benefits, and Objectives of Career Planning. Read this in the Hindi language: करियर योजना का अर्थ, परिभाषा, लाभ, और उद्देश्य। 

    The concept of Career Planning Discussing the topic: Meaning, Definition, Benefits, Process, Features, and Objectives of Career Planning.

    All the jobs, which are organized together during the working life of someone, make careers. It is also seen as a sequence of posts organized by a person during his employment. Edwin B. Flipo defined a career as a sequence of different but related work activities that provides continuity, order, and meaning in a person’s life. As well as, a career can be seen as the amalgamation of change in value, attitude, and motivation because it gets old. This concept constitutes the subjective element of “careers”.

    Definition of Career Planning:

    Career planning is the process of enhancing an employee’s future value. A career plan is an individual’s choice of occupation, organization and career path.

    A career may define as,

    “A sequence of jobs that constitute what a person does for a living.”

    According to Schermerborn, Hunt, and Osborn,

    “Career planning is a process of systematically matching career goals and individual capabilities with opportunities for their fulfillment.”

    Career planning encourages individuals to explore and gather information, which enables them to syn­thesize, gain competencies, make decisions, set goals and take action. It is a crucial phase of human resource development that helps the employees in making a strategy for work-life balance.

    Below described several themes underlying different definition of a career as:

    1] The property of occupation or organization:

    In this way, the career describes the occupation itself or an employee’s tenure within an organization.
    Advancement: It denotes the progression and increase in success an individual receives within an occupation or organization.

    2] Status of a profession:

    In this sense, a career uses to distinguish different professions. Such as engineering, the medical profession is different from other occupations like plumbing carpentry, etc. The former says to have a career where the latter does not have.

    3] Involvement in one’s work:

    Sometimes the career use in a negative sense to describe being extremely involved in the task or job one is doing.

    4] Stability of a person’s work pattern:

    Career describes a sequence of related jobs. While a sequence of unrelated jobs does not describe career.

    Career is often defined as both an external career and an internal career. External career is defined as objective categories used by a given society and different organizations to describe the progression of steps of the different occupations. Whereas an internal career involves the set of steps and stages that make up an individual’s concept of career progression in a given occupation.

    Due to two different approaches, in the organizational context, career is considered as an integrated pace of both vertical and lateral movements of an individual in occupation during the span of his employment. Such an integrated approach is intended to minimize diversity of hopes and expectations of employees by obtaining a match between individually perceived careers with that of organizational centered careers.

    Benefits of career planning:

    The following benefits are given below:

    • The career plan ensures the continuous supply of promotional employees.
    • It helps in improving employee loyalty.
    • Career planning encourages the development and development of the employee.
    • Discourages the negative attitude of senior officials who interest in suppressing the development of subordinates.
    • This ensures that senior management knows the capacity and capacity of those employees who can move upwards.
    • It can always make a team of employees ready to meet any contingency.
    • Career planning reduces the labor business.
    • Each organization prepares the successor plan on which the career plan is the first step.

    The process of career planning:

    Career plans involve different activities for successful organizations and generally include the following steps.

    1] Identifying personal needs and aspirations:

    Most individuals do not have a clear-cut about their career aspirations, anchors and goals. Therefore, human resources professionals should help an employee in this direction and provide as much information as possible. Keeping in mind their skills, experience, and ability, they are shown such work, which will make them the most suitable. Workshops, seminars can also arrange to enhance such support with psychological testing, simulation exercises. Such a practice is basically to help create a clear view of the career of a chosen business within a company.

    Workshops and seminars promote employee interest in career planning, as it helps employees to determine their career goals, identify career paths and highlight specific career development activities. Printed and other types of information can also provide to complement individual efforts. Also, helping employees better, organizations create data banks or skills and talent lists, which include career history, skill evaluation, and information about their employees’ career priorities.

    2] Analyzing career opportunities:

    Once you know the career requirements and the aspirations of the employees, the organization determines the career path for each situation, which clearly shows career progression prospects. It points to different situations, a good artist can catch in a period. Career paths change over time, according to the needs of the employee and organizational needs.

    3] Aligning needs and opportunities:

    After identifying the needs of the employees and their career opportunities, the next step is to align the former with the former. This process involves identifying the ability of employees and then starting a career development program. The efficiency of the staff can demonstrate a thorough evaluation.

    This will know the employees who need further training, who can take additional responsibilities, etc. Some development techniques are used to consider employee’s information and skills in an employee capacity. It includes special assignments, schematic position rotation, supervisory coaching, job enhancement, weak program, etc.

    4] Action plans and periodic reviews:

    After starting the above steps, it is necessary to review the whole items from time to time to highlight the gap. These intervals have to be a bridge through personal career development efforts and from time to time supported organizations.

    Periodic review will help employees know the direction in which it is moving, whether the change is sought, what kind of skills required to face new and emerging organizational challenges. Organizations also find out how employees are doing, their goals and aspirations, and what career paths are in line with personal needs and serve the whole corporate.

    Features of Career Planning:

    The following features of career planning are below:

    1] Process:

    Career planning is an ongoing process of developing human resources. It is neither an event nor a program.

    2] Upward movement:

    It involves upward movement in the organizational hierarchy. It could also be special assignments, completing a project that requires better skills and abilities to handle recurring problems.

    3] Mutuality of Interest:

    Career plans serve a mutuality of interest. It serves the individual’s interest by taking care of his needs and aspirations to the required extent. Simultaneously it serves the organization’s interest as the human resources of an organization provide the opportunity to develop and contribute to the organization’s goals for the fulfillment of its objectives to the best of their ability and confidence.

    4] Dynamic:

    The dynamic nature of career planning is to cope and adjust to the ever-changing environment.

    Objectives of Career Planning:

    Career planning aims at matching individual potential for promotion and individuals aspirations with organizational needs and opportunities. Career planning is making sure that the organization has the right people with the right skills at the right time. It opens avenues for growth to higher levels of responsibilities for every employee of the organization through the hierarchy of position, and training and development activities to equip the individuals with the requisites for succession.

    Generally, Career Planning aims at fulfilling the following objectives:

    • It provides and maintains appropriate human resources in an organization by offering careers, not jobs.
    • It creates an able environment of effectiveness, efficiency, and growth.
    • Maps out careers of different categories of employees, following their ability and willingness to “train and develop” to take the responsibility of higher positions.
    • It seeks to maintain a stable workforce within an organization by controlling absenteeism and reducing employee turnover.
    • Caters to the immediate and future human resource needs of the organization at the appropriate time.
    • Increases the proper utilization of managerial reserves within the organization.

    The major objectives of career planning are as follows:

    • To identify the positive characteristics of the employees.
    • Develop awareness about each employee’s uniqueness.
    • To respect the feelings of other employees.
    • To attract talented employees to the organization.
    • Train employees towards team-building skills.
    • To create healthy ways of dealing with conflicts, emotions, and stress.

    Understand career planning:

    Since both the person and the organization interest in one’s career, the career plan itself is an intentional process to be aware of the current obstacles with available opportunities, alternative options, and sequences. As well as, it involves identifying targets related to careers to provide the right direction, appropriate time and sequence for achieving a specific career goal and doing work education and related development practice.

    Essentially, career planning helps employees plan for their careers in terms of their capabilities and competencies in terms of organizational needs. It is related to developing the organizational system of career movement and development. This gives opportunities for any person to progressive and continuously from an entry point of his employment at the point of his retirement. It has also been described as the process of synthesizing and reconcile the organization’s needs with the innate aspirations of the employees so that afterward, realize the self-fulfillment and improve the effectiveness of the former.

    Extra Things:

    Career planning is an ongoing process by which a person determines their career goals and identifies the means and methods of achieving them. The way people plan their life’s work, they consider a career plan. It inspires someone to explore, choose and endeavor to achieve satisfaction with the purpose of a person’s career. Therefore a person’s life is important.

    The effective career plan is about finding a suitable job that corresponds to the life of a person. The Career Plan answers the question, where are the possibilities of going forward and growing in the organization for a person to be in the organization after five years or ten years or to build the realm of someone’s career. Career planning is neither an event nor an end. Also, it is a continuous process for human resources development and an essential aspect of managing people to achieve optimal results.

    Why is the need for Career planning for employees?

    The need to plan for employee careers is due to both economic and social power. In an ever-changing environment, the human resources of the organization should be in a constant state of development and should be there. A planned program of internal human resources development pays more than relieving external recruitment for recruitment. At the top, many employees retire at the job when there is no managerial concern for proper career progression.

    Apart from this, employees of Millennium Day insist and hope that their work expects to integrate effectively with human needs for personal development, together with family expectations, meet the ethical requirements of the society. However, it is most ironic that, as far as the work is concerned, what is the most valuable for the person, the career is, the organization gets the least attention. As well as, most organizations do not pay enough attention to this important aspect of actual practice for various reasons. As a result, the demand for employees does not match adequately with systematic arrangements.

    More knowledge:

    Career planning is an indispensable condition for effective human management to achieve optimum productivity, for organizational development and development, keeping in mind the increasing expectations and aspirations of changing scenarios of the social and economic environment and employees. Generally, a person applies for the job in the organization after making necessary inquiries about job prospects and after taking a job, he starts inquiring about job prospects and future potential situation.

    Disadvantaged of satisfactory answers, a person feels motivated and frustrated and starts looking out of the organization in search of any other possible job. Generally, this is a normal situation for individuals with senior supervisory, executive and managerial positions. As well as, employees holding such a position are curious to know that they can grow in their current positions, organization and when. To attract and maintain competent personnel for senior positions in an organization, they must be assured of a progressive career.

    Thus, career planning has become necessary to prevent such personnel from managing the organization with skilled supervisors, high technical and managerial personnel to manage an organization and the lack of promotional routes. Productive employees want to seek careers instead of short-term jobs. Also, a career scheme, if properly designed and implemented, benefits management and employees and its absence makes a big difference for both the employees and the organization. Read this in the Hindi language: करियर योजना का अर्थ, परिभाषा, लाभ, और उद्देश्य। 

    Meaning Definition Benefits and Objectives of Career Planning
    Meaning, Definition, Benefits, and Objectives of Career Planning.
  • Factors Affecting of Price Determination with Steps and Process

    Factors Affecting of Price Determination with Steps and Process

    What is Price Determination? In Economics Price Determination is the interaction between the demand and supply in the free market that is used to determine the costs for a good or service. Basically Meaning is Interaction of the free market forces of demand and supply to establish the general level of price for a good or service in Market. Also learn, Factors Affecting of Price Determination with Steps and Process.

    In the production of Marketing is also important of Factors Affecting of Price Determination with Steps and Process.

    The Factors Affecting Price Determination of Product

    Main factors affecting the price determination of product are:

    Product Cost:

    The most important factor affecting the price of a product is its cost. Product cost refers to the total of fixed costs, variable costs and semi-variable costs incurred during the production, distribution, and selling of the product. Fixed costs are those costs which remain fixed at all the levels of production or sales.

    For example, rent of the building, salary, etc. Variable costs refer to the costs which are directly related to the levels of production or sales. For example, costs of raw material, labor costs etc. Semi-variable costs are those which change with the level of activity but not in direct proportion. For example, a fixed salary of Rs 12,000 + up to 6% graded commission on an increase in the volume of sales.

    The price of a commodity is determined on the basis of the total cost. So sometimes, while entering a new market or launching a new product, the business firm has to keep its price below the cost level but in the long rim, it is necessary for a firm to cover more than its total cost if it wants to survive amidst cut-throat competition.

    The Utility and Demand:

    Usually, consumers demand more units of a product when its price is low and vice versa. However, when the demand for a product is elastic, little variation in the price may result in large changes in quantity demanded. In the case of inelastic demand, a change in the prices does not affect the demand significantly. Thus, a firm can charge higher profits in the case of inelastic demand. Moreover, the buyer is ready to pay up to that point where he perceives utility from the product to be at least equal to the price paid. Thus, both utility and demand for a product affect its price.

    The extent of Competition in the Market:

    The next important factor affecting the price of a product is the nature and degree of competition in the market. A firm can fix any price for its product if the degree of competition is low. However, when the level of competition is very high, the price of a product is determined on the basis of the price of competitors’ products, their features, and quality etc. For example, the MRF Tyre company cannot fix the prices of its Tyres without considering the prices of Bridgestone Tyre Company, the Goodyear Tyre company etc.

    Government and Legal Regulations:

    The firms which have the monopoly in the market, usually charge the high price for their products. In order to protect the interest of the public, the government intervenes and regulates the prices of the commodities for this purpose; it declares some products as essential products for example. Life-saving drugs etc.

    Pricing Objectives:

    Another important factor, affecting the price of a product or service is the pricing objectives.

    Following are the pricing objectives of any business:

    • Profit Maximisation: Usually, the objective of any business is to maximize the profit. During the short run, a firm can earn the maximum profit by charging the high price. However, during the long run, a firm reduces the price per unit to capture the bigger share of the market and hence earn high profits through increased sales.
    • Obtaining Market Share Leadership: If the firm’s objective is to obtain a big market share, it keeps the price per unit low so that there is an increase in sales.
    • Surviving in a Competitive Market: If a firm is not able to face the competition and is finding difficulties in surviving, it may resort to free offer, discount or may try to liquidate its stock even at BOP (Best Obtainable Price).
    • Attaining Product Quality Leadership: Generally, the firm charges higher prices to cover high quality and high cost if it’s backed by the above objective.
    Marketing Methods Used:

    The various marketing methods such as distribution system, quality of salesmen, advertising, type of packaging, customer services, etc. also affect the price of a product. For example, a firm will charge high profit if it is using an expensive material for packing its product.

    The Steps Involved in Price Determination Process.

    The Price decision must take into account all factors affecting both demand price and supply price. The Process of Price Determination. The market price is the price determined by the free play of demand and supply. The market price of a product affects the price paid to the factors of production – rent for land, wages for labor, interest for capital and profit for the enterprise. In fact, price becomes a basic regulator of the entire economic system because it influences the allocation of these resources.

    The pricing decisions must take into account all factors affecting both demand price and supply price. The price determination process involves the following steps:

    • Market Segmentation: On the basis of market opportunity analysis and assessment of firms strengths and weaknesses marketers will find out specific marketing targets in the form of appropriate market segments. Marketers will have the firm decision on  – (a) the type of products to be produced or sold, (b) the kind of service to be rendered, (c) the costs of operations to be estimated, and (d) the types of customers or market segments sought.
    • Estimate of Demand: Marketers will estimate the total demand for the products. It will be based on sales forecast, channel opinions and degree of competition in the market.
    • The Market Share: Marketers will choose a brand image and the desired market share on the basis of competitive reaction. Market planners must know exactly what his rivals are charging. Level of competitive pricing enables the firm to price above, below, or at par and such a decision is easier in many cases. The higher initial price may be preferred if you expect a smaller market share, whereas if you expect of much larger market share, you prefer the lower price.
    • The Marketing Mix: The overall marketing strategy is based on an integrated approach to all the elements of the marketing mix. It covers – (1) product-market strategy, (2) promotion strategy, (3) pricing strategy, and (4) distribution strategy. All elements of the marketing mix are essential to the overall success of the firm. Price is the strategic element of the marketing mix as it influences the quality perception and enables product positioning.
    • Estimate of Costs: Straight cost-plus pricing is not desirable always as it is not sensitive to demand. Marketing must take into account all relevant costs as well as price elasticity of demand, if necessary, through market tests.
    • Pricing Policies: Price policies provide the general framework within which managerial decisions are made on pricing. Pricing policies are guidelines to carry out pricing strategy. Pricing policy may desire to meet competition or we may have pricing above or below the competition. We may have fixed or flexible pricing policies. Pricing policies must change and adapt themselves to the changing objectives and changing environment.
    • Pricing Strategies: Pricing policies are general guidelines for recurrent and routine issues in marketing. The strategy is a plan of action (a movement or counter movement) to adjust with changing conditions of the marketplace. New and unanticipated developments may occur, e.g., price cut by rivals, government regulations economic recession, fluctuations in the purchasing power of consumers, changes in consumer demand, and so on. Situations like these demand special attention and relevant adjustments in our pricing policies and procedures.
    • The Price Structure: Developing the price structure on the basis of pricing policies strategies is the final step in the price determination process.
    The Factors Affecting of Price Determination with Steps and Process - ilearnlot
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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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  • What is the Recruitment Process?

    What is the Recruitment Process?

    Understanding and Learn, What is the Recruitment Process?

    It is very important for an employer to design a recruitment process for hiring the best professionals within a given time frame. The Recruitment Process is explained in the few steps involved as follows: Recruitment Planning, Strategy Development, Searching, Screening, and Evaluation & Control. Though the process of recruitment may differ from organization to organization, it has more or less similar steps. Also learn, What is the Recruitment Process?

    What is recruitment? In Human Resource Management, “recruitment” is the process of finding and renting the best and most qualified candidate for opening a job at a time and cost-effectively. It can also be defined as “the process of looking for potential employees and encouraging and encouraging them to apply for jobs in an organization”. This is a complete process, with a full life cycle, that starts with the identification of the company’s needs in relation to the job, and the organization ends with the introduction of the employee.

    Recruitment refers to the process of identifying and attracting job seekers so as to build a pool of qualified job applicants.

    The recruitment process comprises a few interrelated stages, viz,

    • Planning.
    • Strategy development.
    • Searching.
    • Screening.
    • Evaluation and control.

    The ideal recruitment programme is the one that attracts a relatively larger number of qualified applicants who will survive the screening process and accept positions with the organization when offered. Also, Recruitment programmes can miss the ideal in many ways i.e. by failing to attract an adequate applicant pool, by under/overselling the organization or by inadequate screening applicants before they enter the selection process.

    Thus, to approach the ideal, individuals responsible for the recruitment process must know how many and what types of employees are needed, where and how to look for the individuals with the appropriate qualifications and interests, what inducement to use for various types of applicants groups, how to distinguish applicants who are qualifying from those who have a reasonable chance of success and how to evaluate their work.

    1. Recruitment Planning:

    The first step involved in the recruitment process is planning. Here, planning involves to draft a comprehensive job specification for the vacant position, outlining its major and minor responsibili­ties; the skills, experience, and qualifications needed; grade and level of pay; starting date; whether temporary or permanent; and mention of special conditions, if any, attached to the job to be filled ”

    The first stage in the recruitment process is planning. Planning involves the translation of likely job vacancies and information about the nature of these jobs into set the of objectives or targets that specify the (1) Numbers, and (2) Types of applicants to be contacted.

    Numbers of contact: Organization, nearly always, plan to attract more applicants than they will hire. Some of those contacted will uninterest, unqualified or both. Each time a recruitment Programme is contemplated, one task is to estimate the number of applicants necessary to fill all vacancies with the qualified people.

    Types of contacts: It is basically concerned with the types of people to information about job openings. As well as, The type of people depends on the tasks and responsibilities involving and the qualifications and experience expected. These details are available through job the description and job specification.

    2. Strategy Development:

    When it is estimated that what types of recruitment and how many are required then one has concentrated on (1) Make or Buy employees, (2) Technological sophistication of recruitment and selection devices, (3) Geographical distribution of labour markets comprising job seekers, (4) Sources of recruitment, (5) Sequencing the activities in the recruitment process.

    Once it is known how many with what qualifications of candidates are required, the next step involved in this regard is to devise a suitable strategy for recruiting the candidates in the organization. The strategic considerations to be considered may include issues like whether to prepare the required candidates themselves or hire it from outside, what type of recruitment method to be used, what geographical area be considered for searching the candidates, which source of recruitment to be practiced, and what sequence of activities to be followed in recruiting candidates in the organisation.

    ‘Make’ or ‘Buy’: Organisation must decide whether to hire less skilled employees and invest in training and education programmes, or they can hire skilled labor and professional. Essentially, this is the ‘make’ or ‘buy’ decision. Organizations, which hire skilled and professionals shall have to pay more for these employees.

    Technological Sophistication: The second decision in strategy development relates to the methods used in recruitment and selection. This decision is mainly influenced by the available technology. The advent of computers has made it possible for employers to scan national and international applicant qualification. Although impersonal, computers have given employers and job seekers a wider scope of options in the initial screening stage.

    Where to look: In order to reduce the costs, organizations look into labor markets most likely to offer the required job seekers. Generally, companies look into the national market for managerial and professional employees, regional or local markets for technical employees and local markets for the clerical and blue-collar employees.

    When to look: An effective recruiting strategy must determine when to look-decide on the timings of events besides knowing where and how to look for job applicants.

    3. Searching:

    Source Activation: Typically, sources and search methods are activating by the issuance of an employee requisition. This means that no actual recruiting takes place until lone managers have verified that vacancy does exist or will exist. Also, If the organization has planned well and done a good job of developing its sources and search methods, activation soon results in a flood of applications and/or resumes. The application received must screen. Those who pass have to contact and invited for the interview. Unsuccessful applicants must be sent the letter of regret.

    Selling: A second issue to address in the searching process concerns communications. Here, the organization walks the tightrope. On one hand, they want to do whatever they can to attract desirable applicants. On the other hand, they must resist the temptation of overselling their virtues. In selling the organization, both the message and the media deserve attention. As well as, Message refers to the employment advertisement. With regards to media, it may state that the effectiveness of any recruiting message depends on the media. Media are several-some have low credibility, while others enjoy high credibility. Selection of medium or media needs to do with a lot of care.

    4. Screening:

    Screening of applicants can regard as an integral part of the recruiting process, though many view it as the first step in the selection process. Even the definition of recruitment, we quoted at the beginning of this chapter, excludes screening from its scope. However, we have included screening in recruitment for valid reasons. The selection process will begin after the applications have been scrutinizing and short-listing.

    The hiring of professors in a university is a typical situation. Application receiving in response to advertisements is screened and only eligible applicants are called for an interview. Also, A selection committee comprising the Vice-chancellor, Registrar, and subject experts conducts the interview. Here, the recruitment process extends up to screening the applications. The selection process commences only later.

    Though some view screening as the starting point of selection, we have considered it as an integral part of recruitment. The reason being the selection process starts only after the applications have been screened and shortlisted. Let it be exemplified with an example.

    In the Universities, applications are invited for filling the post of Professors. Applications re­ceived in response to the invitation, i.e., advertisement are screened and shortlisted on the basis of eligibility and suitability. Then, only the screened applicants are invited for a seminar presentation and personal interview. The selection process starts from here, i.e., seminar presentation or interview.

    Job specification is invaluable in screening. Applications are screened against the qualification, knowledge, skills, abilities, interest, and experience mentioned in the job specification. Those who do not qualify are straightway eliminated from the selection process.

    The techniques used for screening candidates vary depending on the source of supply and method used for recruiting. Preliminary applications, de-selection tests, and screening interviews are common techniques used for screening the candidates.

    Purpose of screening:

    The purpose of screening is to remove from the recruitment process, at an early stage, those applicants who are visibly unqualified for the job. Effective screening can save a great deal of time and money. Care must exercise, however, to assure that potentially good employees are not rejecting without justification.

    Also, in screening, clear job specifications are invaluable. It is both good practice and a legal necessity that applicant’s qualification is judged on the basis of their knowledge, skills, abilities, and interest required to do the job.

    The techniques used to screen applicants vary depending on the candidate sources and recruiting methods used. Interview and application blanks may use to screen walk-ins. Campus recruiters and agency representatives use interviews and resumes. Reference checks are also useful in screening.

    5. Evaluation and Control:

    Evaluation and control are necessary as considerable costs are incurred in the recruitment process. The costs generally incurred are: –

    • Salaries for recruiters.
    • Management and professional time spent on preparing job description, job specifications, advertisements, agency liaison and so forth.
    • The cost of advertisements or other recruitment methods, that is agency fees.
    • Recruitment overheads and administrative expenses.
    • Costs of overtime and outsourcing while the vacancies remain unfilled.
    • Cost of recruiting unsuitable candidates for the selection process.

    Evaluation of recruitment process:

    The recruitment has the objective of searching for and obtaining applications for job seekers in sufficient number and quality. Keeping this objective in the mind, the evaluation might include:

    • The return rate of application sent out.
    • A number of suitable candidates for selection.
    • Retention and performance of the candidates selected.
    • Cost of the recruitment process.
    • Time lapsed data.
    • Comments on the image projected.

    In view of above, it is necessary for a prudent employer to try to answer certain questions like whether the recruitment methods are appropriate and valid? And whether the recruitment process followed in the organization is effective at all or not? In case the answers to these questions are in negative, the appropriate control measures need to be evolved and exercised to tide over the situa­tion.

    However, such an exercise seems to be only rarely carried out in practice by the organization’s employers. Having discussed the recruitment process, it will be now relevant to have an idea about recruitment practices in India. The following section delineates the same.

    What is the Recruitment Process - ilearnlot
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