MARKETING

Introduction:
As human history speeds towards the year 2002, with its awe-inspiring problems and opportunities, the subject of marketing is attracting
increasing attention from companies, institutions, and nations. Marketing has evolved from its early origins in distributions and selling into a
comprehensive philosophy for relating any organizations dynamically to its market. Marketing is a cornerstone of pol8icy and practice in such giant
concerns as General Electric, Procter & Gamble, Sears, and IBM. Large and small business firms everywhere are beginning to appreciate the
difference between selling and marketing and are organizing to do latter. Developing nations are examining marketing principles to see how their
domestic distribution system can be improved and how they can compete more effectively in world markets.
The intensifying interest in marketing is paradoxical because while marketing is one of mans newest action disciplines, it is also one of the
worlds oldest professions. From the time of simple barter through the stage of money economy to today’s modern complex marketing system,
exchanges have been taking place. But marketing - the study of exchange process and relationships - made its formal appearance only in the early part
of 20th century, it was given birth due to the questions and issues neglected by its mother science, Economics.
In the short time, Marketing has achieved the image of societies savior in the minds of many. Marketing’s good deeds have been described in
various ways:
Aggressive marketing policies and practices have been largely responsible for the high material standard of living in America. Today through
mass low cost marketing we enjoy products which were once considered luxuries and which are still so classified in man foreign countries.
Advertising nourishes the consuming power of men. It creates wants for a better standard of living. It sets up before man the goal of better
home, better clothing, better food for himself and his family. Its spurs individual exertion and greater production.

DEFINITION:
Various definitions of marketing have appeared through time:
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 It has been described by one person or another as a business activity; as a group of related business activities; as a trade phenomenon; as
a frame of mind; as a coordinative, integrative function in policy making; as the process of exchanging or transferring ownership of products; as
a process of concentration, equalization, and dispersion; as the creation of time, place, and possession utilities, as a process of demand and supply
adjustment; and as many other things.
Marketing is human activity directed at satisfying needs and wants through exchange processes.

CONCEPT:
The marketing concept is a management orientation that holds the key task of the organization is to determine the needs and wants of
target markets and to adapt the organization to delivering the desired satisfactions more effectively than its competitors.
In short, the marketing concept says, “ Find lacunae’s and fill them” rather than “ Creating products and sell them. The underlying premises of
the marketing concept are;
1. Customer is the king of the market, he is the central theme.
2. Consumers can be grouped into different market segments depending on their needs and wants.
3. The consumers in any market segment will favor the offer of that organization which comes closest to satisfying their particular needs and
wants.
4. The organizations task is to research and choose target markets and develop effective offers and marketing programs as the key to attracting and
holding customers.
5. The concept creates and delivers the standard of living to the society.

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Online Marketing:
The Internet was originally intended to use as a medium for defense and academic communications. Today it continues to serve that purpose
but is increasingly used for recreation. In the future, it will be an important commercial channel. It has been suggested that last year there was $ 2.8
billion of commerce conducted on the Internet, by 2001 that is expected to swell to $ 240 billion. If a company is to benefit from this trend it must
develop marketing techniques specifically suited to the Internet. At present, all that is known about marketing on the Internet been learned from
experience over the past few years. One of the lessons learned is that the marketing concept applies to Internet marketing. The marketing concept
stresses the importance of satisfying the consumer.
This year has seen a surge in online advertising that moved out of its experimental stage. Diverse online demographics, precise targeting, an
increase in awareness levels and Internet usage are some of the factors that contributed to its growth. Ad banners still reign, and there is an increased

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use of content sponsorships - micro sites, interstitials, which has led to more creative advertising.
The advertising and marketing fraternity has recognized the rightful place of the online medium in the communication mix. The Internet has
the power to build brands, establish consumer relationships, sell products and provide customer service. These strengths are in addition to the power
online advertising has for relationship marketing and direct sales.

Some facts:
· Consumers are increasingly being educated to expect and thus demand 24 hour a day, 7 day a week sales and service.
· Consumers today are more educated and want more information prior to making a purchasing decision. ·
Because the Internet meets these 2 basic criteria of consumer needs, the worldwide market of Internet users is growing exponentially, faster
than any other media. Television has traditionally been the biggest spending medium for advertisers seeking to sell products and services. With an
estimated market penetration in the Western world of around 95%, TV has been accepted as a "traditional" advertising medium for many years. But
look at the history of TV! At the end of World War 2, there were an estimated 10,000 television sets in use only, with about half of these in New York
City. The end of 1949 had sold 1 million sets. By 1956, the gross income of the television industry - predominantly advertising - was around $590
million. The Internet and Internet Marketing is less than 10 years old - really only achieving increasing prominence as a marketing tool over the past 5
years. And yet already, after such a short time span, revenue from commerce conducted over the Internet in 1997 is estimated at $9 billion! Clearly,
"There’s gold in them thar bytes!" The rules of successful Internet marketing have not yet been clearly spelt out. Television was seemingly much
easier - it was something tangible, which you could see, and required very little effort or understanding on behalf of the viewer. It was something both
marketers and consumers could relate to, and relied predominantly on visual impact for its marketing success. Conducting commerce over the Internet
is different. There are guidelines to follow.

The Target Market

The first task in developing a marketing mix is to define the target market. In the case of marketing to consumers via the Internet, one of the

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essential characteristics of the target market is that it consists of people who are connected to the Internet. Because most employers prohibit or
significantly limit personal use of company machines, especially concerning shopping and recreation, a primary concern is with those connected at
home. Internet consumer demographics are probably similar to those of the Innovator and/or Early Adopter in Product Diffusion Theory. They tend to
be younger, with above average education and income. They receive product information from each other or from narrowly focused publications.
Internet users may be classified as Surfers or Shoppers. Surfers use the Internet for recreation. They visit web sites as explorers, moving from site to
site and not returning unless there is entertainment motivation. Shoppers use the Internet for a directed purpose, to gather information about a topic of
interest, to make purchase decisions, or to conduct a purchase transaction.

The Marketing Mix -- Product

The marketing literature makes much of the four P's, product, price, promotion and place, as elements of the marketing mix. This framework
can be applied to developing an Internet marketing strategy. The first logical consideration is of the product being offered. Consumer products may be
classified as specialty goods, shopping goods, or convenience goods. Specialty goods are ones for which the consumer has a specific preference and
will go to considerable effort to obtain. Specialty goods currently offer the greatest opportunity for sale on the Internet. The customer knows the
specifications of the product sought, even to the point of brand loyalty. In many cases the product has known quality and characteristics. An example
would be using Amazon (an on-line book store) to buy a book or CDNow (an on-line music store) to purchase recorded music. The customer knows
what to expect when the article is delivered. The Internet is also a good place to seek hard-to-find products, like out-of-print books or recordings by
obscure artists. Shopping goods are things for which buyers are willing to put considerable time and effort in the purchase process. The inherent lack
of opportunity to examine or sample goods is a detriment to marketing some shopping goods on the Internet. On the other hand, the ability to easily
custom tailor specifications, as in the case of buying a computer on-line, is a particular Internet advantage. Also, if the consumer is shopping for the
best price, it is possible to rapidly survey a wide range of options. In some cases, brokers will facilitate shopping by presenting the offerings in order
of some important characteristic, as in the case of travel services arrayed in order of price, or departure time, or airline carrier. Convenience goods are
frequently purchased items which buyers are willing to exert only minimal effort to obtain. These presently offer the least opportunity for marketing on

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the Internet. In the case of impulse purchases of convenience goods, the delay between purchase decision and availability for consumption or service is
a serious shortcoming. There is little likelihood that consumers will observe something while surfing the Internet that would remind them that they
need to replenish some category of product. Finally, the added cost of order picking and delivery cannot be borne by most classes of low-priced
convenience goods. An additional class of products that falls outside the traditional classification is goods that are of a sensitive or personal nature.
The lack of personal contact offered by on-line purchasing allows consumers to maintain their privacy while receiving a high degree of customer
service.

The Marketing Mix -- Price

Price is one of the most important elements in the marketing mix. It certainly provides the most obvious basis for comparison. Consumers
shopping on the Internet can easily access prices from a great many possible suppliers. Also, prices for goods on the Internet may be relatively low
because the overhead cost of maintaining a web site is much less than a regular retail outlet. It must be remembered, however, that many Internet
suppliers have dual operations, one regular retail store and one on-line. These operators would not enjoy the benefit of low overhead. Another price
advantage enjoyed by Internet shoppers, at present, is the absence of state sales tax for purchases delivered out-of-state. That situation is currently
being studied as state legislatures see growing on-line markets as an additional source of tax revenue. A final consideration, the delivered price of
goods purchased on the Internet may be increased due to handling and shipping charges. One of the weaknesses of Internet shopping from the
perspective of the consumer is security. There is the risk that the supplier may not satisfactorily deliver the goods ordered. The merchandise may be
inferior, incorrectly selected, may never arrive. Two possible actions that can reduce consumer concern are to have a clearly articulated and fair return
policy and the point out consumer protection assurances made by credit card companies. If the goods are mis-represented the card company can issue a
credit to relieve the consumer of the debt. A final consumer concern is with transaction security. Sometimes credit card information is improperly
accessed and the consumer is charged for a large number of improper purchases. These risks are reduced by improved electronic transmission security
and a broader protection policy from the credit card issuer.

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The Marketing Mix -- Promotion
Originally intended as a means of communication, the Internet offers an additional advertising medium to deliver promotional messages to
consumers. The problem from the consumers' perspective is in finding the appropriate sellers' web sites. The situation is similar to trying to find a
Chinese restaurant in a strange city. One approach would be to travel around the city, looking for a Chinese restaurant, hoping to find a good place to
eat. That undirected strategy is similar to that of the Internet Surfer who goes from web page to web page, searching for something interesting. A more
productive strategy is that of the Shopper, who checks some sort of index or directory to make a selection of the desired destination, then navigates to
the desired location by use of a map. Internet Shoppers refer to a search engine or classified directory to identify possible vendors. It is important for
Internet marketing success that web sites are listed in as many search engines as possible. Also, hyper links in related material and banner ads on
popular web sites can provide easy access to the vendor's location and build traffic of potential customers. Finally, ads in traditional media can be used
to direct people to Internet sites. One of the issues of web site design is the conflict between creativity and profit. The creative people want to produce
expressive ads and web sites with artistic merit, the sales manager wants ads that sell. Sometimes these two objectives conflict. The purpose of
advertising and web sites is to make the consumers' tasks easy; easy to find, easy to download the information, easy to understand, and easy to use.
The Internet is more than a communications medium. It also serves to facilitate the transaction. Consumers can make their selection of alternative
vendors and alternative products, place an order, and arrange payment without moving from the computer. Ease of use is probably the strongest
argument in favor of consumers' use of the Internet for shopping. As the level of technology advances in the short-term future, that ease of use will
increase.

The Marketing Mix -- Place

The primary advantage enjoyed by Internet shoppers is the convenience of the place they shop -- it is from home. The Internet has a world-
wide reach and any location is accessible from the shoppers' computers. There is the added convenience of 24-hour a day shopping and the avoidance
of crowds, traffic and parking. And, as previously noted, a number of sites may be comparison shopped in rapid succession. About the only
disadvantage is the shipping delay that exists between making a selection and receipt of the goods. Most of the items of conventional wisdom

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concerning retailing apply to achieving customer satisfaction on the Internet. The physical design of the site; routing, layout, atmospherics,
appearance, or image, whether it is physical or virtual, must be keyed to customer convenience. The customer forms an impression about the "store"
from first exposure. If the impression is not favorable, the customer will not shop and will not return. Many retailers run dual operations, a physical
store and a virtual store. It is desirable that these two operations are mutually reinforcing and present a congruent market offering. If customers are
familiar with your physical operation, and like it, they will be comfortable buying through the web site. For other shoppers whose only contact is
through the Internet, the purchase poses a greater degree of risk. Satisfactory Internet purchases, on the other hand, may increase patronage of
corresponding retail stores.

Conclusions
Consumers' use of the Internet for shopping is partly a function of benefits received. These benefits are
1) Convenience in terms of being quick and easy to shop and make comparisons without traffic, crowds, or parking;
2) Access to a broader and deeper product selection and to a greater variety of stores;
3) Possibly lower prices as a result of lower overhead and wider competition;
4) It’s fun to shop on the Internet. Shopping on the Internet is also a function of the detriments.
Benefits must outweigh the detriments, which are:
1) The time lag between purchase decision / selection and delivery of the goods;
2) The inability to examine or sample the product;
3) The risk of dealing with an unknown, possibly unreliable merchant.
More consumers are going to be using the Internet in the future for shopping. Although the Internet is a new marketing channel, most of the
traditional principles will apply, including the marketing concept. Application of the marketing concept means that merchants must look at things from
the perspective of the consumer to be successful. Consumers will patronize suppliers who provide more benefits in the shopping experience than
detriments. This article has suggested ideas about how that can be put into practice.

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Penetration of Web in India:
(Research done by Nasscom January 2001 shows in India there are 5.5 million internet users with 1.5 connections), it has begun to attract the
attention of advertisers. Various researches indicate that Indians with access to the Internet spend a considerable percentage of their total media
consumption time on the Internet (According to IRS 2000, on weekdays the time spent on the Net is 1:30 hrs as against press, which is at 1:13 hrs and
TV, which is at 2:21hrs).

Scenario:
A research study from Internet.In.India, IMRB Sep 2000, reveals that early adopters to the Net spend more time on the medium. People, who
have been using the Internet for the last one-year, spend on an average about 4.5 hrs a week whereas those who had been using the Net for more than 2
yrs spend as much as 6 - 7 hrs a week. This has been illustrated in the diagram below wherein the time spent on the medium varies with how old/ new
he is with the medium. Thus, a person who is highly evolved with the medium spends at least 7-8 hrs a week on the medium for various reasons.

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Comparison With Other Media’s:
How do Web ad banners presently compare to traditional advertisements?
Why do the Web and Print advertising make a more dramatic impact on users upon first exposure to the advertisement? While television has
the advantage of being more intrusive (moving visuals, sound, etc.), it is nonetheless a passive medium where the viewer is not required to be actively
engaged. Conversely, Web and print-based media both have the advantage of active reader involvement and attention. The term “active” refers to the
fact that consuming the medium requires the user to be actively engaged and attentive. This “engaged” state, which the nature of
The Web encourages, seems to result in higher initial attention to advertising. The ability of an ad to be noticed is a necessary precursor to any more
fundamental effect. The performance of Web advertising is impressive when one considers the magnitude of investment in research to make superior
Television advertising versus the lack of investment to date in pre-testing research for Web advertising. For instance, Millward Brown International
alone conducts over 1,000 television-advertising pretests per year.
1. Its inherent interactivity allows it to be more robust than traditional media.
2. It is the only medium where users can view ads, request and receive specialized product information, make an instant purchase, save
time and expenses.
3. Webvertising promotes unique user involvement, personalization, and also accommodates traditional advertising models of reach and
frequency.
4. Most marketers think the Internet is just an information carrier and, because of its technological strengths, communication can be
tailored along two key dimensions:
 The first dimension is a continuum that ranges from proactive to reactive communication.
 The second dimension ranges from broadcast communication to personal dialogue. It means that advertisers can reach and
communicate with their target audience in myriad ways - from broadcast advertising that proactively reaches the TA on a mass reach website, to
personalized e-mails delivered in a jiffy.

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Further analysis based on evolution of various mediums in India reveals:
 Radio's adoption was primarily driven by delivery of messages using audio elements. It was successfully exploited to
counter the high illiteracy levels in rural India.
 Print was targeted more towards the literate mass, as they would like to be informed about the happenings around the world
with some facts substantiating it. Additionally there was freedom of press (unlike Radio that was still Government controlled). This helped the
Print media to grow, as it was credible.
 TV's adoption is more towards its content appeal by delivering information using audio and video elements. The added
advantage was the mediums appeal to demonstrate and showcase a product, which in addition added to its emotive appeal.
 The Internet delivers the benefit of a 2-way personalized communication at a low cost ensuring a higher satisfaction. This
was a key driver for people adapting to this medium.
However, technology is not the sole factor for fulfilling the communication objectives. For online advertising to work efficiently, this multi-
faceted medium requires an online communication mix appropriate to the brands marketing strategy. Technology shouldn't drive strategy. Marketers
should first define their business objectives and then assess how the technology can be used to achieve these objectives.

Marketing Communication
Marketing communications is one of the major elements of the company's marketing mix. The instruments of marketing communication -
Advertising, Personal Selling, and Sales Promotions And Publicity - have separate and overlapping capabilities, and their effective co ordinations
requires careful definition of communications goal.

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 ADVERTISING

DEFINITION:
Advertising is one of the major tools companies used to direct persuasive communications to target buyers and public. It consists of non-
personal forms of communication conducted through paid media under clear sponsorship.

Online Advertising:
Online advertising has tremendous communications power; a single exposure
can generate increases in:
 Advertisement awareness
 Brand awareness
 Product attribute communication
 Purchase intent

Comparison With Other Media

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 Some facts prevailing, which gives a clear comparison of Web Advertising With Other Media.

Fact: Consumer acceptance of online advertising is comparable to that of traditional media.

MBinteractive asked comparable questions for the Web, Print, and Television in a separate survey of its recently established, nationally
representative panel of US Web users. On a five point scale ranging from “Strongly in favor of ” to “Strongly against,” between 60% and 70% of Web
users report top-two box scores in favor of Web, Television, and Print advertising. Web users are less supportive of Radio advertising and are
somewhat opposed to outdoor signage/billboards (only one third report a top-two box score in favor of such marketing vehicles).

Fact: Television Audiences are Migrating to the Net

The erosion of the network television audience during the 1980s and 1990s changed media plans forever. In the early '80s, television was simple to
plan and buy with just three networks to consider. Then came cable, then a fourth network called FOX, followed by a dizzying array of syndicated
offerings and yet more new network entries: Paramount and the WB. New choices continued to fragment traditional television viewing and advertising
budgets soon followed this trend.

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 Television's recent history has demonstrated that media budgets ultimately are pragmatic. As audiences migrate, media plans follow,
acknowledging that the ultimate goal of any brand is to reach its target audience effectively and efficiently. The exploding media landscape of the 90s-
driven by increased TV audience fragmentation and the Web's popularity-have put this process into overdrive. Like the 80s and early 90s, media
planners are, again, adapting their plans to account for the ever-growing numbers of people spending increasing amounts of time online at the expense
of other media.

This migration of the television viewing audience to the Internet is particularly striking. This data is made even more impressive by the fact
that Internet users are remarkably upscale. So, not only are we witnessing a fundamental shift in media habits, the Internet audience represents that
hard-to-reach, well-educated, high-income population most coveted by marketers.

Fact: The Net is the Fastest Growing Medium in History

Internet advertising began in 1994, when the first banner ads were sold (Hotwired, October 1994) and the first commercially available Web
browser, Netscape Navigator 1.0, was released (November 1994). In a recent study, Mary Meeker, Managing Director, Morgan Stanley, and her team
of researchers closely examined the adoption rate of the Internet, contrasted to the three other major "new media" invented this century: radio, network
television and cable TV. As a common metric, they examined the number of years it took or will take for each media to reach 50 million U.S. users.
With television, cable and radio included for historical context, the growth of the Net is nothing short of remarkable. Meeker estimates the Internet will
capture 50 million users in just five years. It took TV 13 years and radio 38 years to reach this milestone.

Fact: Web ad banners build brand awareness and may be better at generating awareness than television or print advertising.

Since their first appearance on commercial Web pages, the value of banner ads has been debated. Many felt they were physically too small to
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offer much branding and some advertisers convinced themselves that click-through was the only metric by which to measure ad effectiveness.

A FORCE score indicates the effects of time, exposure weight, diminishing returns and base level. As such, FORCE scores can be directly
compared across media types. As the median FORCE score for television advertisements is 10, the scores reported in the chart below (with an average
score of 20 for the Web banners tested) suggest that Web banners tested very favorably to most TV ads, in terms of creating brand-linked awareness.

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Online advertising is more likely to be noticed than television advertising.

Millward Brown International’s FORCE score (First Opportunity to see Reaction Created by the Execution) measures the percentage of people
who will recall seeing an advertisement after the first exposure. The results show that Web advertising compares favorably to television in its ability to
create a brand-linked impression and be remembered. The results are impressive since little research has been conducted on how to optimize online
advertising — much in contrast to the significant expenditures allocated to television and print creative pre-testing. And while television has the
advantage of being more intrusive (through the combination of sight, sound, and motion), television (in its current incarnation) is still a passive
medium where the viewer is not required to be actively engaged and attentive to the medium to consume it. Conversely, Web and print based media
have the advantage of active reader involvement and attention, requiring physical contact and action to consume the medium. The engaged state that
the web encourages seems to help provide higher attention to online advertising.

Why is Brand-Linked Impression An Important Measure Of Advertising Effectiveness?

While an immediate purchase response to advertising would be ideal, it is the rare exception. Rather than inducing consumers to “buy right
now,” most advertising works by locking appropriate brand-linked memories into long-term memory. By doing so, the advertising creates expectations
for brands such that the consumer is more willing to try the product when in an experimentation mood (packaged goods) or is more likely to
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investigate the product further (in the case of considered purchase products). Consumers test the expectations established by advertising through
product trial or by soliciting confirmation among experienced product users via word-of-mouth. Because this is not an objective evaluation process,
creating the Brand-Linked Impression is a critically important function of advertising. Nearly 90% of the Web ads tested to date by MBinteractive
have demonstrated a positive improvement on Brand-Linked Impression. By this critical metric, Web advertising clearly works.

Can Web Advertising Positively Impact Brand Perceptions?

The IAB study tested a wide array of brands ranging from consumer-packaged goods to automobiles, high-technology products, financial
services, and online content services. Each brand message had a unique set of objectives. While it is unlikely that a single advertisement in any
medium could accomplish all of these objectives, we suggest, in general, that each brand attempts to:
  Develop presence in the minds of consumers.
  Enhance perceived relevance
  Demonstrate performance on key attributes
  Emphasize advantage and differentiate itself from competitors
  Create a bond with the consumer
Each Web ad banner that had a statistically significant shift in brand perceptions at the 90% confidence level as a result of the additional ad
exposure. Below, are some brand perception data that is statistically significant at the 90% confidence level In general; we conclude that Web
advertising can positively impact brand perceptions. In general, we conclude that Web ad banners can positively impact brand perceptions.
KENWOOD STEREO SYSTEMS

(Not actual size)

The exposure to the Kenwood ad banner increased “appeals to you more than other brands of home stereo systems” by 23%. An exposure to
the Kenwood ad banner appears to have a positive effect on consumer perceptions by enhancing the appeal of the brand.

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TOSHIBA VIDEO BOARD

(Not actual size)

Out of the six Web ad banners that had statistically significant change, the Toshiba ad shows the most complex adjustment in viewer
perceptions. The Toshiba ad appears to polarize consumers’ attitudes making some feel more positive and others less. “Is a good laptop computer
accessory” declined 27% (30% vs. 41%).
More than half the of drop is accounted for by those exposed to the banner having a better impression of Toshiba; those reporting that Toshiba
“is better than other laptop computer accessories” increased 120% (11% vs. 5%) while “appeals to you more than other brands of laptop computer
accessories” increased by 71% (12% vs. 7%). However, some of those exposed felt less positively toward Toshiba. The perception that Toshiba “is
growing more popular” declined 39% (11% vs. 18%) and “offers something different than other brands of laptop computer accessories” dropped from
5% indicating agreement with this statement to 1% among those exposed. Clearly the ad had an impact on attitudes. For some consumers, this Web ad
banner enhanced their perception of Toshiba’s products, but for others it degraded their positive perceptions. We conclude that the net impact of the
exposure to the Web ad banner is positive for Toshiba, based on an 11% increase (from 13.4 to 14.8) in Consumer Loyalty, a measure of future
purchase behavior.

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VOLVO LUXURY AUTOMOBILE

(Not actual size)

The Volvo ad banner seems to increase users’ belief that Volvo makes “a good auto-mobile” (an increase of 55%) and that Volvo “offers
something different than other brands of automobiles” (an increase of 57%). Because of the ad banner, those exposed are more likely to “have a higher
opinion [of Volvo] than other automobiles” (an increase of 44%). The additional exposure to the Volvo ad banner has consistent positive effects —
enhancing the perception of performance and competitive differentiation.

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 Web advertising has the potential to make an immediate positive impact on brand perceptions after a single additional ad banner exposure.

Some Of The Tools Used In Online Advertising

• Banners
• Clickthroughs
Banners Explained
Its understandable why banner ads are thought to have poor communication. The first rush to the web was based on the notion that
corporations and brands built websites based on the abilities to communicate with every positive aspect of a company or brand all in one place. “If you
built it, they will come”, it was thought, and certainly all of those thousands of hits sounded like something big was happening.
Agencies initially made money the only way they knew how, by creating sites. Not much creative juice went into development of online
creative, and it continues to be a problem. Just try to get the best creative minds at traditional agencies to hammer out banners. More likely, its a group
that has never worked if the bands communications assets before. Traditional agencies are now responding to the industry’s call for more attention
with special digital subsidiaries, joining the ranks of online agencies that call the medium thereon.

Clickthroughs:
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 Importantly, the new attention to online media needs to go beyond the direct marketing valuation and recognize advertising as one of its other
primary strengths. Clickthroughs are seen to be unrelated to brand communications.
The industry needs to understand that clickthroughs are merely observable behavior related to visiting a site, based on the category, the offer
and the creative. To measure the most significant impact on a brand overall, the same type of communications research that accompanies any type of
significant marketing activity must be used. The great news is that the Internet makes this type of communications research relatively simple, fast and
cheap, allowing for real time learning.

What is the role of clickthrough in Online marketing?

Ever since Web banners were introduced, marketers were captivated by the banner’s powerful ability to allow direct and instantaneous
response to its offer. Clickthrough a direct marketing manifestation — quickly became the standard for evaluating the effectiveness of Web ad banners.
In light of the finding that clickthrough rate is a poor predictor of the overall brand-enhancing abilities of an ad banner, we present MBinteractive’s
perspective on the role of clickthrough in online marketing.

What Is The Value Of Clickthrough?

While additional powerful messaging may wait for the consumer on the other side of an ad banner, the ad banner itself does a significant
amount of brand enhancement communication. In fact, among the twelve ad banners we tested, on average, the brand enhancement value of the ad
exposure is significantly greater than the value of the clickthrough.
To be sure, the clickthrough metric (the percentage of those exposed to the ad banner who click on the banner to connect to the advertiser’s
Web site) is important. However, when it is used to measure the effectiveness of advertising communication, clickthrough fails grotesquely. Why is
this so? After all, many have argued that if someone is truly affected by an advertisement, he or she will click through the banner and go directly to the
advertiser’s Web site for more advertising information.
The point of view that Web ad banners are really little “ads” for a bigger ad that is only delivered when users click through is not completely

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unreasonable. It is generally true that a user who takes the time to transfer over to the advertiser’s Web site will take away a heightened level of
information regarding the advertiser. However, there is a flaw in this logic that stems from a handful of incorrect assumptions, namely:
 Brand enhancement can only happen on the advertiser’s Web site
 Brands have far more to say than could ever be conveyed in a Web ad banner
 Clickthrough should be sought by all advertisers
 The level of clickthrough determines the level of brand enhancement It is MBinteractive’s perspective that these assumptions, as we will demonstrate,
are incorrect and counterproductive.
Brand enhancement can happen as a result of exposure to an ad banner alone while additional powerful messaging may await the consumer on
the other side of an ad banner, the ad banner itself does a significant amount of brand enhancement communication. In fact, among the twelve ad
banners we tested, on average, the value of the ad exposure is significantly greater than the value of the clickthrough. To put the clickthrough metric in
proper context, consider that recall of the advertisement was boosted by four-tenths of one percent (from 43.7% to 44.1%) as a result of those who
clicked on the ad banner. That’s an increase of less than one percent!
Said another way, 96% of the boost in Ad Awareness was caused by the ad exposure alone. The remaining four percent was caused by the
clickthrough.

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 The model that assumes the user is passively exposed to Web pages and then, upon exposure to the right Web advertisement, miraculously
shifts to an engaged mode upon clicking through is not supported by the data. Rather, the effectiveness of Web advertising seems to be driven by the
fact that Web usage is an actively engaging exercise, similar to reading magazines. Users are fairly attentive to the media environment — including the
advertisements. Clearly the belief that the ad banner is really a small ad for the “real” ad that waits on the other side of a click through can be rejected
based on the data.
An advertiser who sacrifices the brand message on the exposure level in hope of achieving better brand enhancement by bringing people to a
dedicated Web site would need to achieve stratospheric click through rates to do better than a branded ad banner with no click through to the dedicated
Web site. But what about using click through as a surrogate measure (or predictor) of brand enhancement from the exposure? As discussed previously,
the FORCE score is a metric that can be used across media to measure an advertisement’s ability to generate a brand-linked impression: a fundamental
metric of Brand Enhancement. We examined click through and FORCE scores across the twelve brands tested and found a pathetic -.02 correlation,
suggesting that click through does a very poor job of predicting the level of brand enhancement. Click through should not be sought by all advertisers.
May be the ad copy should read, “Don’t Click Here! Devouring a Web page won’t satisfy your hunger, this will…now where is that vending
machine?”

Fictitious Example
Undoubtedly, some people will click on the banner (digerati like to do what they are told not to). However, the ad’s goal is to reinforce top-of-
mind consideration of the product and, perhaps, generate a behavioral response other than click through (namely purchase). Measuring the success of
the campaign by the number of clicks would be inappropriate.

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Online Advertising Dramatically Increases Advertisement Aware-ness After Only One Exposure.
Advertisement Awareness is measured by a question asking respondents if they recall seeing an ad on a particular Web site in the past seven
days. Those who respond “no” are prompted with the tested ad and then re-asked the question. By the criterion of getting noticed by consumers, the
twelve ad banners tested by the IAB demonstrate unequivocal success after a single additional ad exposure. Eleven out of the twelve show marked
improvement in advertisement awareness. An additional exposure to the advertisement boosted advertisement awareness by 30% on average (from
34.0% to 44.1%), statistically significant at the 95% confidence level.

Web Advertising Boosts Awareness Of Advertised Brands

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 Web ad banners not only have the ability to remind consumers about brands of which they are already aware, Web ad banners can and do
inform users about products that were not previously on the consumer’s radar. Across the 12 brands tested, we observed an increase of 5%, on average,
in awareness of the brands (from 61% to 64% — statistically significant at the 95% confidence level). Online advertising provides significant brand
communications power.
CONCLUSION
Online advertising, using banners, has tremendous communications power. In fact, banners can impact the traditional marketing measures of…
 Advertisement awareness
 Brand awareness
 Brand perceptions
 Purchase intent
…all from one exposure.
The Web’s advertising power is just beginning to be understood. Our findings suggest that many advertisers looking to build their brand and
increase their sales should utilize online advertising.

Overview Of Methodology:
The IAB Online Advertising Effectiveness Study was fielded from June 1 to June 13, 1997, simultaneously across twelve leading Web sites:
CNN, CompuServe, ESPN Sports Zone, Excite, Geocities, HotWired, Looksmart, Lycos, MacWorld, National Geographic Online, Pathfinder
(People), and Ziff-Davis. Over one million members of the Web audience had an equal opportunity to be randomly sampled over the course of the first
wave, which collected basic demographics and an email address. The second wave was conducted over a time period ranging from one day to one
week after ad exposure. Forty-seven percent of wave one respondent’s com-pleted the second wave, yielding 16,758 respondents — a substantial test
sample.
While the study told potential respondents that the research was designed to “learn more about them,” control was sought for a multitude of

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factors that could influence a test of advertising effectiveness. The classic experimental research design, the most rigorous study methodology
available, was applied by randomly assigning users to be part of either the test or exposed cells. Because Web ad banners are served individually to
Web users, this assignment was invisible to the respondents. Importantly, both the exposed and test cells were treated identically in all respects, except
for the exposure to a test Web ad banner.

Objective Of Methodology:
Whether Web advertising banners have the ability to positively impact advertised brands.

Normal course of Web media consumption

As a user, imagine you access www.people.com (fig. 1). You click on the hypertext link to access “celebrity news.” A proprietary sampling
algorithm developed by MBinteractive runs in a matter of milliseconds. All users have an equal chance of being randomly sampled. If you are not
selected, you receive the Web page you requested. If you are sampled, a short demographic survey Web page appears soliciting your participation in a
short demographic and webographic study “to help the Web site better understand those who use its service” (fig. 2). We also asked for an email
address so that we could enter the respondent into a contest as a way of thanking them for their participation. Forty-five percent of sampled users
completed the demographic wave of the survey, generating a base size of 36,065 respondents. After completing the survey, respondents clicked on
“submit survey” and were then served “celebrity news” (the page they had initially requested). We then served a “test” Web ad banner to half of the
respondents based on random assignment and served a “control” ad to the other half (fig. 3). This individualized delivery of advertisements was
invisible to the user. The page position and dimensions of the test and control ads are identical.
At a predetermined point in time after exposure to the test or control Web ad banner, ranging from one day to one week, MBinteractive
emailed respondents requesting that they access a Web page “to help answer a few more questions.” We asked both control and exposed respondents

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identical questions related to the “test ” brand specifically and advertising in general.

A methodology of this type sets a high standard for advertising effectiveness because it is a precise measure of the effects of one additional
exposure to a Web ad banner. The chart below provides an illustration of the difference in exposure to the test ad among “control” and “exposed”
respondents.

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 In order to measure the effect of the additional advertising banner exposure, MBinteractive emailed respondents requesting that they access a
Web page “to help answer a few more questions.” This solicitation occurred at a predetermined point in time after exposure to the test or control Web
ad banner (ranging from one day to one week). They asked both control and exposed respondents identical questions related to the “test” brand
specifically and to advertising in general. Forty-seven percent of wave-one respondents completed the second wave, generating a base size of 16,758
respondents. Those who completed the second wave showed no statistically significant differences from those who completed the first wave in terms
of the variables measured in the first wave (specifically: age, sex, time spent online in a typical week, year first accessed the Web).

Ad Awareness
Some would argue that it is the primary responsibility of ad-supported Web sites to provide a supportive context in which the appropriate
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target audience receives an advertiser ’s message. To this extent, the first level of advertising effect we examine is the ability of the ad banner to be
noticed. We call this measure advertisement awareness, and it is based on a question asking respondents if they recall seeing an ad on a particular Web
site in the past seven days. Those who respond “no” are prompted with the tested ad and then asked the question, “Have you seen this advertisement
[on the particular Web site] in the past seven days?”
Brand-linked Impression
Perhaps more important than ad awareness is a measure of the ability of a Web ad banner to create a Brand-linked Impression. This top-of-
mind impression is unprompted and therefore measures whether an exposure to the ad links the brand to the communicated message. It is a strong
predictor of sales in traditional media. We measure Brand-linked Impression by asking respondents if they recall seeing an advertisement for a
particular brand in the past 7 days.
Brand Awareness
A goal of some advertising (especially that of new brands) is to increase the awareness of the advertised brand. Before a consumer can have an
opinion or perception of a brand, they must first be aware of it. We measure brand aware-ness with the question, “Before taking this survey, had you
ever heard of [brand]?”
Brand Perceptions
An important goal of many advertisements is to positively impact a brand’s perception in the minds of consumers. Though individual advertisements
and brands have varying objectives, we suggest, in general, that brands seek to use their advertisements to:
 Develop presence in the minds of consumers
 Enhance perceived relevance
 Demonstrate performance on key attributes
 Emphasize advantage and differentiate themselves from competitors
 Create a bond with the consumer
We measure the ability of Web advertisements to meet these objectives through a battery of brand attribute/perception questions.

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Brand Dynamics Pyramid

Millward Brown International’s BrandDynamics ™ Pyramid allows us to under-stand how the advertisement has changed the relationship the
audience has with the brand by describing the pathway to a deepening attitudinal predisposition toward the brand. It is based on a consistent set of
brand equity measures that can be applied across different brands, categories, and countries. The BrandDynamics ™ system uses some of the brand
perception questions mentioned above. In addition, BrandDynamics ™ anchors its measurements in the economic value consumers have to the brand.
The objective in developing the BrandDynamics ™ Pyramid was to find a way of systematically diagnosing the factors underpinning the
brand’s Consumer Loyalty. In other words we wanted to identify why one person might have a high loyalty for a brand while another might have a
low loyalty. Each level of the pyramid represents an increased level of familiarity and involvement with a brand. The percentages refer to the
proportion of people from our panel (based on the pre-survey) that fell into each level of the pyramid for the average brand. The rationale for each level
is described below.
The brand must demonstrate that it is more relevant than others by creating some advantage over its competition. If a brand is to thrive, it must
offer a unique proposition to consumers. In the crowded markets of the 1990's many brands have little functional product differentiation, but successful
brands manage to develop a distinctive product positioning or personality through advertising. Work by Farr and Brown xv has shown that advertising
can be used to enhance the product experience by raising expectations and focusing selective perception on the rewards of the brand. Branthwaite
and Swindells xvi have described the psychological mechanisms by which advertising can also raise the status and interest of a brand by creating a
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halo of excitement, uniqueness and supremacy. People reach this level if they mention the brand on one of the following attributes:
 Better performance
 Different from other brands
 Appeals to me more
 Growing more popular
 Most popular brand
 Have a higher opinion of than others
 Acceptable price
 Meets my needs
 First mention at unaided brand awareness
Should your brand include online in your marketing mix?
The answer for most brands depends on whether there is economic value. Before we can determine the prospect for positive return on investment, we
must quantify the size of the opportunity that online implies for your brand. The size of the opportunity can be measured by:
 Sizing the percentage of the target market you could potentially reach via the Web.
(We refer to this metric as your “Web-enabled target market.”)
 Measuring the economic value to your category that online users represent. (We refer to this metric as Web users’ “economic value.”)
The economic value profile of those who are Web-enabled allows the marketer to determine the dollar value of the Web to your brand. If those who
are Web-enabled are heavier users of your category and if they are difficult to reach through other media, the Web is a strategic imperative. Take the
following illustrative example: 23% of an automobile manufacturer ’s target market is online (Web-enabled metric). Because of the Web’s somewhat
affluent demographics, Web users are more likely to purchase higher-margin luxury automobiles — and therefore account for 40% of the company’s
profits (economic value metric).

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Do you know the value of the Web to your category? Do you know the implications?
Does your competition? Understanding the implications of the size and economic value of the Web-enabled target is the first element of a pragmatic
and strategic approach to evaluating the value of marketing your brand via the Web. Millward Brown International currently tracks brand
communication across media categories for over one third of the top one hundred advertisers. We recently encouraged every brand to add the questions
that will allow them to measure the Web enabled and economic value metrics. While the size and economic value metrics suggest whether or not
online holds immediate marketing opportunity for the brand, we need to delve deeper to address how the marketer can use online for marketing to
enhance the bottom line. After All, an online brand presence is much more than simply building a Web site.
How should your brand use online for marketing?
The Internet is often referred to as a medium, but the term is rather misleading because it implies a singular communication format. It may be more
constructive for marketers to think of the Internet as a technology that enables communication; this communication can be fashioned along two key
dimensions: The first dimension is a continuum that ranges from proactive to reactive communication. The second dimension ranges from broadcast
communication to a personal dialogue.

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What does this way of thinking imply for the marketer? It means that you can reach and communicate with your online target in a multitude of ways
— from a broadcast advertisement that proactively reaches your target audience on a mass-reach Web site to a personalized email delivered in reaction
to an individual customer’s query. It means that online is not monolithic. It is multifaceted and requires an online communication mix appropriate to
your brand’s marketing strategy. But with many options and an evolving technology that expands the list of options on a daily basis (it seems), how is
a marketer to develop a coherent strategy and effective tactics?
Development of a coherent strategy and effective tactics requires the marketer to first define business objectives and then to assess how the
technology can be used to achieve the objectives. Some objectives are best achieved with a broadcast message, while others are best achieved with a
personal touch. Some objectives require waiting for consumers to initiate the dialogue so that the brand can react to their perceived needs, while other
objectives are best achieved with the brand proactively communicating with the consumer.
They suggest that development of realistic objectives begins with an evaluation of:
 The nature of your product and service
 The current level of Web site category use by your target population
 Perceived legitimacy of personalized communication related to your product in the minds of consumers Exploring these areas will help the marketer
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to develop the appropriate objectives and optimize the online marketing mix of communication options. Nature of the product Certainly the nature of
the product should have a dramatic impact on the types of online communication you employ. Brands requiring:
 higher levels of support and customer service, or
 higher consideration prior to purchase, or
 online acquisition
are among the categories that will benefit from a comprehensive Web site that reacts to consumer and prospect queries. But even brands that enjoy a
high degree of active consumer investigation should communicate proactively — not just to inform the consumer that a corporate Web site can be
accessed with a “Click Here” but also to carry the brand message directly to the consumer, communicating the unique brand proposition. Brands that
can only be purchased offline, that have lower levels of formal information gathering prior to purchase or do not require significant customer support
do not require a mega Web site to satisfy a consumer’s need. While brands finding themselves in this category may attempt to create content appealing
enough to entice users to their Web site, they not only run the risk of confusing the consumer regarding the focus of the brand, these brands will often
obtain a greater impact on their bottom line with advertising and exclusive content sponsorships on ad-sup-ported content Web sites than with a
colossal corporate Web site. Consumers’ level of Web site category use Up until this point, we’ve discussed the relevance of a reactive Web site and
proactive advertising from a product point of view. What can we learn from consumers?
The consumers’ level of Web site category use demonstrates the percentage of online users that are currently seeking out brands in your category
through the Web. This metric sizes the percentage of your Web-enabled target market who have gone to your (or your competitor’s) Web site of their
own volition. Question: “Have you ever used the Web to get information related to [product or service]?”

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Web site is certainly more likely to attract users than one devoted to soft drinks. Before brands finding themselves in the lower Web site category use
attempt to duplicate Pepsi’s strategy, they should consider the following:
 How will you market your new media product?
 Will your target audience perceive a branded destination content Web site pro-diced by your brand as credible?
 Can adequate resources be devoted over a long enough term for the strategy to pay off?
 Will the publishing quality match the desired perception of brand quality?
 Is direct development more economical than sponsored content?
 Will you get a better return on investment from dollars spent on Web site development and maintenance than from Web advertising?
What if your brand category has lower Web site use, but a profitable segment of your market is online? Lower Web site usage categories, such as
packaged goods, can reap significant value from online communication marketing without a signify-cant Web site investment. They can create value
by focusing their online communication mix almost exclusively in Web advertising, exclusive long-term sponsorships, and similar brand
communication strategies that leverage the power of the medium to proactively reach consumers and enhance the brand through advertising messages.
A tightly focused Web site with extensive brand advertising may be the most effective communication mix.
Developing strategy and tactics
MBinteractive’s experience working with clients to develop strategy and evaluate each communication element has emphasized the vast array of
brand-specific issues that must be considered in this process. To avoid being overly general about how brands should address strategy development
and tactical execution, we will highlight some of the most common issues and the corresponding tools used in the strategy development and tactical
execution process. We will conclude by discussing the importance of a structured approach which draws input from a variety of sources.

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When one considers the choices marketers are confronted with, the task of convert-in all that is possible into a highly effective marketing plan can be
daunting indeed. Most businesses have a structured approach that begins with focused inter-nil ideation sessions to define business objectives and
models as part of the business planning process. Integrating online strategy and planning into the formal business planning discussion is a worthwhile
exercise.
Take your objective and working hypothesis to a broader forum in the organization. Ghettoizing online marketing to a savvy group that “gets
it” may be more time-efficient and yields better results in the short term, but it may ensure that the broader organization never “gets it. The output

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from the business planning discussion should be relative consensus regarding the answer to the question, “Where do we want to go with our brand?”
Enumerating the questions that must be addressed to successfully achieve objectives will also prove valuable.
If the business objectives are well-defined, developing a regime of applied research to identify opportunities, refine strategy, and develop an
effective tactical plan is relatively straightforward. No research program is complete or adequate if it fails to capture the dynamics of the real-world
marketplace. A robust marketing approach builds in a market feedback loop that allows the marketer to measure, evaluate, and enhance in-market
activities.
How do you measure, evaluate, and enhance your online market-in performance?
Marketers have always been concerned about the return on investment they get from advertising. The decades-old Leo Burnett quote, “I know
half my advertising dollars are wasted. I’m just not sure which half!” underscores marketers’ legitimate concern that their investment pay off.
Increasingly, advertisers want to know how their Web ad buys have benefited their brands. Impression and clickthrough, while part of the story, are
insufficient metrics. Ever since the first Web advertising effectiveness study, the online marketer has been asked, “Why can’t we include brand
enhancement in standard online marketing communication measurement?” Fundamentally, marketers want to measure and evaluate their online
marketing so that learning can be captured and applied to enhancing the effectiveness and efficiency of marketing communication. At a minimum, the
tools that marketers have available to them should be on par with the tools used to measure and enhance the effectiveness of traditional advertising
communication. More than two decades ago, Millward Brown International pioneered brand tracking to provide advertisers continuous feedback to
evaluate and enhance traditional marketing communication. The Advanced Tracking Program (ATP) quickly became the model for measuring the
effectiveness and efficiency of marketing investment. Marketers use the powerful brand tracking tool in a variety of ways. For example, marketers can
readily measure the following:
 Relationship between advertising exposure and effect on dimensions, including:
 Ad awareness
 Brand imagery
 Purchase intent

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 Efficiency of the communication
 Impact of flighting and media weight on the brand (see following chart)

The IAB Online Advertising Effectiveness Study demonstrates that Web ad ban-nears can work both as a direct marketing vehicle and as an
advertising communication vehicle. Marketers have powerful research tools to apply to the complex questions of what is and is not working for the
brand. Applying these tools will make marketers more effective and efficient — thus ensuring an accurate measurement of which half of your
advertising dollars is working.
Summary
The IAB Online Ad Effectiveness Study owes much of its ability to rigorously test the effectiveness of Web ad banners to the power of online
itself. Though there were a number of challenges related to the coordination and administration of a simultaneous test across 12 high-traffic sites, we
found that Online is a natural environment for rigorous research. We would encourage other researchers and mar-keters to exploit this ability in order
to develop online into an even more powerful means of commercial communication.

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 SALES
DEFINITON:
it is the process of distributing goods from the producer to the ultimate user through various channels of distribution. it consist of
advertising and selling, storing, transporting and handling and financing or risk taking.

SALES CONCEPT: =
The selling concept (also called the sales concept) is another hallowed way in which producers have sought to guide their exchange activity.
The selling concept is a management orientation that assumes that consumers will either not buy or not buy enough of the organizations products
unless the organizations makes a substantial effort to stimulate their interest in its products.

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The implicit premises of the selling concept are:
1. Consumers have a normal tendency to resist buying most things that are not essential,
2. Consumers can be induced to buy more through various sales stimulating devices.
3. The organizations task is to organize a strong sales oriented department as the key to attracting and holding customers.

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ONLINE SELLING ( e-tailing) :
E-tailing (less frequently: etailing) is the selling of retail goods on the Internet. Short for "electronic retailing," and used in Internet discussions as early
as 1995, the term seems an almost inevitable addition to e-mail, e-business, and e-commerce. E-tailing is synonymous with business-to-consumer
(B2C) transaction. E-tailing began to work for some major corporations and smaller entrepreneurs as early as 1997 when Dell Computer reported
multimillion-dollar orders taken at its Web site. The success of Amazon.com hastened the arrival of Barnes and Noble's e-tail site. Concerns about
secure order taking receded. 1997 was also the year in which Auto-by-Tel reported that they had sold their millionth car over the Web, and Commerce
Net/Nielsen Media reported that 10 million people had made purchases on the Web. Jupiter research predicted that e-tailing would grow to $37 billion
by 2002.

Definition Of E-Tailing:
E-tailing is the process of developing and managing online storefronts whereby individual consumers can shop for goods and services. The focus of e-
tailing is on consumer shopping, not business-to-business commerce. The intent of e-tailing is to provide a customer value proposition that is different
from real space stores. That value proposition often includes cheaper prices, increased flexibility, convenience and consumer empowerment of the
shopping process.

The scenario:
To say that online retailing underwent a transformation in 2000 would be a major understatement. It was a year of devastating defeat for many
pure-play e-tailers, and a year of caution -some would say retreat -for the investment community. At the same time, it was a year in which companies
recognized that online retailing is no longer an option: it is a business requirement. Numerous department store, broad-line, and consumer products
companies brought their brand online, and many more click-and-bricks companies expanded their merchandise assortments online, cater-in to
customers who are spending more on a wider range of product categories.
Here are some of the more significant findings:

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 • More people are buying online. Almost two-thirds of our survey participants worldwide have purchased items online in the past 12 months,
including 75% of German and U.K. respondents and 74% of U.S. consumers.
• Consumers are making more online purchases and increasing their spending. Books, CDs, and computer equipment are still the best-
sellers, but consumers are beginning to move into such "high-touch" products as apparel, health and beauty products, sporting goods, flowers,
and toys.
• Amazon.com is still the consumers' favorite site world-wide. But several traditional brick-and-mortar retail brands are now Top 10 multi-
channel brands.
• Store traffic is being affected by e-tailing. More than half of all shoppers said they visit stores less often because of online shopping.
• The demographic profile of the online shopper has begun to resemble a "typical" on-land consumer. Males dominate outside the U.S., but
women now represent almost 60% of online shoppers in the U.S. and almost 50% in Canada and Australia.
• The majority of customers expect to find lower prices online, but don't always. More than a third of companies interviewed worldwide have
different pricing structures for their online and off-line operations.
• Shipping costs rank as the number-one factor discouraging online buying. But 89% of companies interviewed still charge for delivery, and
11% reported using delivery as a profit center.

Eight Steps to Boosting Online Sales :

1. List all charges up front.
Sticker shock is a fast way to lose potential customers. Present product prices, shipping and handling, and taxes before you ask for billing and personal
information. Drugstore.com does a great job on all those counts.
2. Let shoppers see what's in their carts.
Just as in a retail store, cybershoppers like to keep tabs on what they're buying. Give them a way to see a running tally of items and how much they've
spent. Landsend.com "Shopping Bag" is one solid example.

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3. Allow customers to change orders.
Users like to be able to remove items and modify quantities, especially after seeing the bill. In addition to "buy lists," add "wish lists" that let
customers put items on hold while they decide what they want to purchase. Make it simple for customers to transfer items from the wish list to the
buying list and vice versa. Gap.com makes it easy to defer purchases.
4. Save cart contents for return visits.
Research shows that e-tail shoppers often put items in a cart and come back to the site later to make the purchase. Be sure to automatically save
whatever was in the cart, even if there was no purchase. This is especially valuable at sites where the purchase is an expensive, considered one; travel
site Expedia.com ,for example, allows users to create and store priced-out itineraries.
5. Make special promotions easy to use.
It can be difficult for a shopper to figure out how to apply a special promotion to a purchase. Make this an obvious and simple step, and do it early in
the checkout process. Webvan.com has a consistent link to specials at the top of each page; the information is clear and easy to act on.
6. Hold your customer's hand.
Let customers know when a purchase is on the way or held up. If it's the latter, explain why and keep the customer up-to-date via e-mail. Provide a
way for the customer to return to the site and check order status. Nordstrom.com not only has online status information but also provides e-mail access
to customer support and a toll-free number for live support.
7. Encourage shipping to multiple destinations.
If a shopper is buying gifts, make it easy to send those gifts to a variety of different addresses. Amazon.com does this well, in addition to offering
personalized messages and wrapping-paper choices.
8. Keep forms as short as possible.
Ask only for the information you need to process an order. Also, if shoppers need to go back a screen to correct an error, do not clear all the fields on
the page and force them to fill out the form again. Jcrew.com has a nearly painless registration process that asks only for the bare minimum of
information.

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HOW TO SELL A PRODUCT OVER THE INTERNET .......
PROBLEM : Launching an online store is easy, but setting up a successful shop is another story entirely. Offering appealing products on an attractive
site in no way guarantees that your e-business will succeed. There are a large number of factors to consider when setting up shop on the Internet,
factors that go far beyond the act of adding a shopping cart to an online catalog. All of the services that customers have come to take for granted in
brick-and-mortar shops-from processing credit cards to extended warranty service to accepting returns-need to be duplicated in your online shop. But
do you have the time or means to build in all this functionality yourself?

SOLUTION :
Obviously the first step in e-tailing is building your online store. Storefront services abound on the Internet for companies wishing to be the next
Amazon.com-or just the Web version of the corner hardware store. With some investigative work you can find a service that's right for you. Smaller
stores can choose from among a variety of services. If you'd prefer to get your store exposure through an online shopping mall, consider Yahoo! Stores
or Amazon.com's zShops. eCongo.com's FreeCommerce Builder (www.econgo.com) is a solution targeted at ISPs, small-business associations, and
other organizations interested in hosting a variety of storefronts under a common umbrella. As the name implies, this is a free service for all parties. If
you already have a site, Digital StoreFronts' Retail Pro (www.digitalstorefronts.com) is one of many services that allow you to commerce-enable your
site without learning an array of programming skills. If all you need is a shopping cart added to your site, Digital StoreFront's InterCart provides that
very service for $19.95 per month. The Retail Pro service ($49.95 per month) goes beyond the shopping cart: Such features as inventory control,
search tools, sales support, and reporting validate the additional cost. Either solution provides SSL encryption for transactions and the ability to handle
online credit card processing. Larger stores require a more powerful solution that provides their customers with a richer experience and integrates with
their existing systems. E-Business Suite, from Open Market (www.openmarket.com), enables your storefront to work in tandem with your ERP
system, finance software, existing databases, and other applications currently in use in your enterprise. The solution provides a rich set of modules,
including personalization and content management. Blue Martini Software's Customer Interaction System 3.1 (www.bluemartini.com) aims to let

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vendors provide highly dynamic experiences for their customers. Solutions like these routinely cost over a million dollars to implement.

Ship it
Getting the customer to place the order is only half the battle. Next you need to fulfill it. How you handle shipping is an important part of your
commerce solution. Your good reputation as a merchant can hinge on this very process. The product must arrive on time. Stamps.com is a popular
tool for fulfilling online orders. Stamps.com lets you determine the best shipping option without consulting multiple shipping tables. Just answer some
questions regarding the weight and size of the package, then enter insurance and handling information, and the Stamps .com engine does the work,
returning the shipping costs for a variety of options and providers. You can print the shipping ticket, affix it to the package, and send the product to
your customer.

Billing
Handling billing is a complicated matter. Any kind of credit card processing requires a merchant bank account. Your e-commerce host should provide
you with assistance on setting up this account. But your business might have billing needs that go beyond one-time transactions. ibill
(www.ibill.com), one of the leaders in the billing industry, has a turnkey solution designed to integrate with your site seamlessly. Most of ibill's
solutions also require a merchant account, with ibill providing the interface between your site and the merchant account. In case your customers
require billing options other than credit cards, ibill also supports online checking and payment through its Web900 telephone billing service, which
lets customers pay by calling a 900 number.

Warranty Service
Many items come with the option of extending their warranties. That procedure was easy enough to handle in your brick-and-mortar operation, but
how do you do this online? Enter WarrantyNow (www.warrantynow.com). When you sign up for WarrantyNow, you gain the ability to provide
warranty service and support directly through your shopping cart. Your customers have the ability to sign up for extended warranty service, and

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WarrantyNow provides and supports the warranty services with live 24-hour telephone support.

Returned Merchandise
As much as you might wish otherwise, you'll need a strategy for handling returns. As online sales continue to grow, returns of merchandise sold online
will grow as well. Less than half of the returned merchandise can be resold as new, and the rest is liquidated. And be aware that as returns grow, so
will the number of customers seeking to abuse your returns policy. Are you ready? If you can't take care of returns adequately, check out The Return
Exchange (www.thereturnexchange.com). Customers click the return button and are presented with a form to fill out. The Return Exchange checks its
databases: If the customer has a history of abusing return policies, The Return Exchange flags the return for your consideration. Otherwise, the
customer receives a return authorization number. The easy returns are solved automatically, leaving your team to handle only special problems. The
customer can ship products to The Return Exchange's regional center, which will restore as many of the products as possible to resalable condition and
add them back to stock. If a product can't be salvaged as new, the company will auction it for you. Most of the familiar retail services are migrating to
the Internet. Ultimately, service is what separates the stellar companies from the mediocre ones. By ensuring that your Web customers receive the
same high level of service your walk-in customers expect, you go a long way toward succeeding at e-tail.
The Real E-Tailing Advantage
With e-commerce, it is possible for a consumer to go through the entire purchase cycle without ever having to visit a physical store or deal
with a real-person representative of the company. However, the question is whether more consumers would prefer the online buying experience to the
physical store experience. There are three essential elements in making a purchase for the consumers: item (goods or services), price, and buying
experience. It's easy to see that both the online and the physical stores can carry the same item. On price, many have automatically assumed that the
online stores have a cost (and therefore a price) advantage simply because the online stores don't have the overhead associated with the physical stores
and its staff. However, the reality is more complicated. The difference in costs is really rooted in the different methods of distribution and advertising.
Online stores, by not having the end distribution points in consumer's neighborhood, pass the 'last miles' shipping costs and delivery time to the
consumers. There is value in not having to wait for your product and being able to get your money back without delay for defective products (notice

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the items that were first sold online in significant quantities: books, CDs, videos, tickets, reservations, and stocks, all relatively light and
indestructible). Physical stores, located near popular places, serve as permanent advertisements themselves for attracting customer visits. So, the real
difference between the online stores and the physical stores lies mainly in the buying experience for the consumers. Presumably, physical stores should
be the ones that offer the best buying experience for the customers. For most people, a knowledgeable, friendly, and attentive real person store
representative is still far easier and more pleasant to do business with than a HTML page, however informative and responsive that HTML page is. In
practice, however, many big traditional retailers fail to recognize the critical roles their store representatives have in providing the best buying
experience for the visiting customers. They often fall short in providing the best training and reward programs for their in-store staff. As a result, these
physical stores appear to be disinterested in building long term relationships with their customers. Building this type of one-to-one relationships is
even more difficult for these traditional retailers if staff turnover is high. On the other hand, an online store can continuously learn from the buying
behaviors of their visitors, and then leverage such knowledge in the products and services they offer to each customer. Ironically, in the future, online
stores controlled by software programs may be more capable in improving customer relations than traditional stores run by real people.
The online store, more adept at both aggregating overall customer demands and identifying individual customer preferences, is likely to satisfy its
customers more quickly and more consistently. This capacity to continually improve the buying experience for its customers is the real competitive
advantage the online retailer has over its physical store counterpart.

Trends for the future:

• In the next few years, "branded" companies have an excellent chance to outdistance the competition. Consumers will log on in increasing
numbers this year, and many will go to sites they know and trust-the big brand names, and not necessarily large companies.
• Online retailing will be substantial. Such categories as apparel, accessories, and toys will represent 10-12% of sales; books, music, software,
videos, and consumer electronics could represent as much as 20-25% of sales.
• Experienced online shoppers have already proven that the convenience of online shopping outweighs its shortcomings. They will purchase
virtually any product through this channel, undeterred by "touch and feel" or size.

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 • As technology develops, online shopping will become even more convenient. Tools will make it easier to sell every category of merchandise-
especially the so-called "high-touch" categories like apparel, health and beauty, and luxury goods.
• The customer profile will change. As a younger, "digital" generation, raised with computers, takes center stage, technology and consumer
acceptance will enable a true blended model. There will be no online or off-line retailing, but simply "retailing."
Even five years from now, this industry will be nothing like it is now. Its promise, however, seems assured.

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 HUMAN RESOURCE DEVELOPMENT

Introduction
Technological Trends
Technological change will continue to shift employment from some occupations to others while contributing to a rise in productivity. For
example, Telecommunications already makes it relatively easy for many to work at home. Computer-Aided-Design/Computer-Aided-Manufacturing
systems plus robotics will also increase. Thus, general motors has over 14000 robots building automobiles. Manufacturing advances like these
eliminate many blue collar jobs, replacing them with fewer but more highly skilled jobs. Similar changes are taking place in office automations, where
personal computers, word processing, and management information systems continue to change the nature of office work.
Information Technology has also hastened what experts call the “fall of hierarchy”; in other words, manages depend less and less on
yesterdays stick-to-the-change-of-command approach to organizing. For example, with distributed computing, every employee with a personal
computer on his or her desk can tap into the firms computer network and get needed information.

DEFINITION
Human resource management:
Human resource management refers to the practices and the policies you need to carry out the people or personnel aspects of your management
job.
These include:
Conducting job analysis (determining the nature of each employees job)
Planning labor needs and recruiting job candidates
Selecting job candidates
Orienting and training new employees
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Managing wages and salaries (How to compensate employees)
Providing incentives and benefits
Appraising performance
Communicating (Interviewing, counseling, disciplining)
Training and developing
Building employee commitment

Applications of IT

Utilization Analysis :
Companies and universities that have grants or contracts with the federal government are required periodically to complete utilization analysis,
which are then submitted to the department of Labor’s Office of contract Compliance Programs (OFCCP).The basis of comparison may be the most
recently completed census on a valid industry survey. The comparison is made between (1) company employees in various EEO categories or
subgroups (women blacks and so on) and (2) the number of people in the recruitment area who state that they have comparable skills in response to
census or employment service requests for information.
A report format called the Availability Analysis, accepted by OFCCP, allows the employer to assign appropriate weights to the following
eight factors which are incorporated into the report: (1) general population, but including only those subgroups who are seeking employment; (2)
percent age of unemployment; (3) percentage of work force; (4) requisite skills available in the immediate area; (5) requisite skills available in the
recruitment area; (6) feeder jobs from which internal employees may be promoted or transferred (7) training institutions in recruitment area; and (8)
Internal training available. In other words, this is the employer's opportunity to show the effect on hiring of certain ingredients in the internal and
external environments for that specific company. Thus, if there is no adequate training facility for crafts In the area, that factor may have no value
(zero) in addressing recruitment needs for Category 5; Skilled Crafts.

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 On the-other hand, the company might hire plumbers' helpers and, over a period of three years, train those helpers both on the job and in the
classroom so that the employees can sit for the licensing exam. In this case, internal training would account for a significant portion of individuals
placed into the position of plumber. The company could examine the percentage hired versus the percentage promoted over the last few years to
appropriately balance the weights.
The usual goal for any given category is for the labor force of the company to approximate the general population’s availability of that skill
level. Spreadsheets can easily accommodate these comparisons through user-friendly formulas which calculate weights, percentages, sums, and
complicated "if-then" statements, Employees are roughly divided into approximately seven categories which differentiate between sales, clerical,
crafts, technical, supervisors, professionals, and executives. These main groups are then subdivided by salary ranges. Within each group, the
employees are counted, according to race and sex. When a spreadsheet has been established, the count in
each category (black male, black female, and so on) may be manually entered along with the number of vacancies that were filled the previous year.
All the other data are then completed by the spreadsheet as your formulas pull from the few entries tiles you have made.
The population of the labor area usually changes only with the census. The percentage of unemployment, which is calculated by the state
employment service, changes monthly. The weight that you assign each factor should 'Change infrequently unless there has been a significant change
in one of the factors, such as the unemployment rate. After the formulas have been established and the raw data entered, the spreadsheet will compare
availability with actual current utilization underutilization exists, the spreadsheet is able to calculate the percentage of underutilization, how many hires
or transfers are needed to overcome the underutilization, and how many need to be hired in the current year. The OFCCP report must be calculated for
the major minorities (such as black and Hispanic, or whatever protected groups represent more than 10% to 12% of the labor force in your immediate
geographical area) and females.
The reason that this information should be built into a spreadsheet is so that goals for the given year may be available to recruiters and hiring
supervisors at the beginning of the measured year. Although affirmative action docs not require the company to favor protected groups (assuming there
is no court order to require partiality), significant underutilization in a particular group strongly suggests that the recruitment techniques need to be
examined.

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Computerized Skills Inventories
When filling positions, knowing the job’s requirements isn’t enough: You should also know the skills of possible candidates now employed by
your firm. Simply posting the opening on a company bulletin board does not guarantee that every employee will see the posting or will interpret the
information appropriately. One way to improve
the likelihood that qualified internal candidates will be introduced into selection process is to have a computerized skills inventory completed and
updated regularly by employees. Then the HR department can help to match good internal applicants with job openings.
Both the development of the Inventory content and the updating of Inventories require significant Input from employees. They must believe in
the validity of the content of the inventory, and this will happen only if they participate in the development process. If employees have ready access to
computers, the inventory can be developed and updated from their workstations. Otherwise, hardcopy memos should invite all employees to describe
themselves in terms of the range of skills to be listed, the standards that differentiate various skill levels, and how skills should be categorized.
Inventories should be regularly updated when an employee has completed a course, Seminar, workshop, or assignment that is applicable. If
computers are not generally available, employees should be allowed time (20 to 30 minutes) each quarter to update the inventory. Time spent on the
updating may be minimized by periodically providing each employee with a hard copy of his or her inventory to mark up before the actual data entry.
Skills should be reassessed at least annually at the time of performance appraisals. If an employee has questions about interpretations of skill levels or
categories, supervisors or HRM personnel should offer assistance. Periodic review of the Inventory and the process should occur, and all employees
should receive regular training to maintain the validity of the system.
When a vacancy occurs, interviewers would specify the parameters of the job based on the job analysis in terms of the skill categories and
levels. A computer program would then produce a list of employees who qualify according to these parameters. This list would be modified based on
other factors such as attendance, quality of performance, time in position, or interest of the candidate. Employees otherwise qualified could receive a
letter informing them of the opening and inviting them to apply if interested, with a copy to the employee's supervisor.
Expressing interest in a position that offers greater responsibility should be encouraged by a company that is interested in retention. Employees

52
who sec the company encouraging growth and development are more likely to stay with the company. Developing a skills inventory system with
significant employee input, active encouragement. to update, and results that keep employees informed of promotional possibilities will enhance
retention.
Straightforward communication with employees is another byproduct of developing a skills inventory process. If an employee is otherwise
qualified, is invited to apply, does so, and is then found to have either performance or attendance problems, those hindrances to promotion will be
addressed because the process encourages informational supervision. Most employees accept constructive criticism if it is offered in a manner designed
to help them progress. Furthermore, with employee participation in establishing the content and standards of the inventory, employees should have a
better understanding of what is expected of them In order to qualify at specified levels and should he able to provide valuable job analysis data based
on what they actually know about their jobs.
Recruiting On The Internet
Computers are playing a bigger and bigger role in helping employers recruit employees today. Computer applications range from recruiting on
the Internet to automatically scanning and storing applicants’ resumes.
A growing number of firms as well as many universities and the federal government are already recruiting using the Internet, the World Wide
Web, and commercial on-line services like CompuServe. For example, Winter, Wyman & Co., a Boston-based recruiting firm posts job descriptions
on its World Wide Web page. Similarly, Honeywell uses America On-Line's E-Span service to recruit for applicants for jobs such as UNIX
Client/Server Applications Programmers, and the firm is considering creating a World Wide Web home page that would include employment listings,
Another firm-American Contract Services-spends about $3,500 a year to run ads on the Internet, ads that "give us unlimited access, full descriptions of
jobs, and no limit to how long the ad can appear." That compares to a typical two-column Sunday ad in a major city's newspaper which could cost
between $1,500 and $2,000. Job hunters might use an Internet search aid like Career Mosaic to find jobs. For example, one such position-open ad was
placed by a recruiting firm seeking a senior programmer for a position in California.
For firms recruiting for employees who are not already on a service like Prodigy, America On Line, or CompuServe, the Internet's On-Line
Career Center is an alternative. As illustrated in Figure 4.15, corporate recruiters can use the career center to review resumes that have been deposited

53
at the center and to place Job openings by job title key work, company name, and geographical region.
Employers are using information technology as an aid in recruiting in various other ways, too. For example, NEC Electronics, Inc., Unisys
Corp., and LSI Logic Corp. have all hosted Internet-based "Cyber-Fairs" to recruit for applicants. The date and time of the fair, along with detailed job
descriptions, are advertised in advance by the employers and by the firm organizing the Cyber Fairs, Hart Advertising network, an advertising and
recruiting firm in Los Altos, California. This advertising is done via newspaper ads as well as via Hart's World Wide Web page. On the day of the
fair,” applicants log on and complete a prequalifying questionnaire before participating In a private on-line interview, during which candidates,
recruiters and managers exchange typed messages on-line.
Other firms like Cray Research, Inc., use their computers to process applicant resumes. Cray, for instance, receives about 200 resumes each
week for positions in their four locations. Using special software these resumes are scanned into Cray's HR databases where its managers can have
instant access to the 14,000 or so r6sum6s in Cray's HR database system.
Computer-Interactive Performance Test
Microprocessors and minicomputers have opened up new possibilities for measuring various types of performance and we should briefly
review some of these. One expert classifies the uses of computers in selection into four kinds of applications. first simply uses the computer as a way
to administer a currently available printed test. Using the computer in this 'way facilitates scoring and the compilation of cumulative norms.
A second way in which computers are used today in selection testing may be called the adaptive test. Adaptive tests automatically tailor a
sequence of test items to each examinee, contingent on his or her responses to earlier items in the sequence. In tests like these, correct responses
generally trigger more difficult items. The effect is to reduce .substantially the number of test items needed, since those that are either too easy or hard
for the examinee are not administered.
Third, computers are being used to enhance the administration of tests when dynamics are involved, as in tests of perceptual speed. Here the
computer can be used to prevent signals rapid and sequentially to test the person's perceptual speed. Similarly, a test of short-term memory, where the
stimulus can be removed from the display and recall required later, is another example of an application here. Fourth, computers are being; used to
measure human capabilities not easily measurable by printed tests. For example, measuring capabilities like the ability to function under different time

54
pressures, or under different work load conditions, or the ability to concentrate under stress are not human capabilities easily measured by printed of
tests. Computers are being used in this area, for in stance, by measuring the person's ability to concentrate as various stimuli are projected on the
screen.
For example, a computerized testing procedure was developed for the selection of clerical personnel in a large manufacturing company. The
eight test components were selected and constructed to represent actual work performed by secretarial personnel and to cover typical secretarial tasks
such as maintaining and developing data bases and spreadsheets, general clerical activities including answering the telephone and filing, and handling
travel arrangements. For example, for the word processing test, applicants were given three minutes (monitored by the computer) to type as much of
this paper as possible; the computer recorded and corrected the manuscript. For the travel expense form completion task, the applicant needed to access
the data base file, use some of the information in it to compute quarterly expenses, and transfer this information to the travel expense form.

Computer Applications In Interviewing: The Computer Aided Interview

When Bonnie Dunn, 20 years old, tried out for a teller's job at Great Western Bank in Chatsworth, California, she faced a lineup of tough
customers.
One young woman sputtered contradictory instructions about depositing a check and then blew her top when the transaction wasn't handled
fast enough. Another customer had an even shorter fuse. "You people are unbelievably slow," he said.
Both tough customers appeared on a computer screen, as part of a 20-minute automated job interview. Ms: Dunn was seated In front of a PC,
responding via a color touch-screen and a microphone. She was tested on making change and sales skills, as well as keeping cool in tense situations.
When applicants sit down facing the computer at Great Western's bank branches, they hear it say, "Welcome to the interactive assessment
aid." The computer doesn't understand what applicants say at that point, although it records their comments to be evaluated later. To begin the
interview, applicants touch a label on the screen, eliciting an ominous foreword: "We'll be keeping track of how long it takes you and how many
mistakes you make. Accuracy is more important than speed."
First, the computer tests the applicant on money skills, asking him or her to cash a check for $192.18, including at least three five-dollar bills

55
and two dollars in quarters. Then, when an angry customer appears on the screen, candidates are expected to grab the microphone and mollify him.
Later a bank official who listens to the recorded interviews gives applicants five points for maintaining a friendly tone of voice, plus up to 15 points
for apologizing, promising to solve the customer's problem, and, taking a cue from the screen, suggesting that in the future he -use the bank's deposit-
only line.
The touchy young woman on the screen is tougher. Speaking rapidly, she says she wants to; cash a $150 check, get $40 In cash, and put $65 in
savings and the rest in checking. As an applicant struggles to sort that out, she quickly adds, "No, it has to be $50 in checking because I just wrote a
check this morning." If the applicant then touches a label on the screen that says "?", the woman fumes, “How many times do I have to tell you?"
Great Western reports that its computer aided interviewing system has been successful. Not only has it dramatically reduced the amount of
useless interviewing managers have to do of unacceptable candidate's, but candidates hired by the program were reportedly 26% less likely to quit or
be fired within 90 days of hiring. (This is partly because the computer tells applicants what the job really involves, something a candidate might be
reluctant to ask a person for fear of appearing negative.)
Training Via The Internet
While it’s still in its infancy, training on the internet is already a reality and there seems no doubt that firms will soon be relying on the
Internet to offer at least some of their training programs.
At the present time, most Internet training programs are (not surprisingly) aimed at teaching Internet users how to use the Internet. Roadmap is
one example, and is the brainchild of Patrick Crispen, an undergraduate student at the University of Alabama. In many ways the course is like a
correspondence course that lands in users' E-mail boxes one new lesson a day for about four weeks. Crispen uses what's known as Listserv software to
simultaneously distribute the lessons to around 20,000 "trainees" per month. Trainees get to work through each new lesson, and some lessons include
assignments that send trainees off Into the outer reaches of the Internet to practice what they've learned about using the Internet and to retrieve
information pertinent to the course. In one varient on this theme the creator of another Internet training program not only delivers courses to the E-mail
recipient trainees but also assigns students to discussion groups, so participants ". . . not only learn something, they'll probably meet some new
people."

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 Of course companies can use the same approach for delivering training programs inexpensively nationally and internationally, but that's not
all. As proprietary networking software like Lotus becomes complimentary to the Internet, firms will be able to provide training programs on a more
secure basis. Furthermore inexpensive devices are already on sale which permit voice transmissions via the Internet and this will probably further
facilitate using the Internet for delivering training programs.

Computerized Managerial Assessment And Development Program

There are a number of Computerized Management 'Assessment 'and Development programs that can facilitate an employer's development
process. One particularly useful example of such a management development tool is called ACUMEN.
ACUMEN is a sophisticated managerial assessment and development program. The Education Version of ACUMEN consists of three
elements; instructions, a self-assessment, and an assessment report. After spending approximately 20 minutes interacting with, ACUMEN's IBM-
compatible program, you will receive a visual display or hard-output "management profile" that focuses on 12 basic management traits:
1. Humanistic-helpful. Measures your inclination to see the best in others, to encourage their growth and development, to be supportive.
2. Affiliation. Measures the degree of friendliness, sociability, and outgoing tendencies you are likely to exhibit.
3. Approval. Measures your need to seek others' approval and support In order to feel secure and worthwhile as a person.
4. Conventional. Measures your need to conform, follow the rules, and meet the expectations of those in authority.
5. Dependence. Measures your tendency to be compliant, passive, and dependent on others.
6. Apprehension. Measures your tendency to experience anxiety and self-blame.
7. Oppositional. Measures your tendency to take a critical, questioning, and somewhat cynical attitude.
8. Power. Measures your tendency to be authoritarian and controlling.
9. Competition. Measures your need to be seen as the best and, to some extent, to maintain a self-centered attitude.
10. Perfectionism. Measures your need to seek perfection, and your tendency to base your self-worth on your own performance.
11. Achievement. Measures your need to achieve and have an impact on things.

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12. Self-actualization. Measures your level of self-esteem, interest in self-development, and general drive to learn about and experience life to the
fullest extent.
When you complete the self-assessment, ACU-MEN analyzes your responses and generates scores on the 12 scales. Each scale represents a
particular attitude of thinking style. The way you think your thinking style) affects:
 What you strive to achieve (your goals).
 Your effectiveness as a leader.
 How you relate to and communicate with other people.
 Whether you view change as positive or negative.
 How you respond to crises and stress.
The major aim of ACUMEN is to help you develop a fuller understanding and appreciation of how your own thinking styles and personal
dispositions play a role In your productivity and management effectiveness. ACUMEN'S analysis of your assessment responses, presented In
graphic or textual form, provides this Information.
When you view the graphic profile display, you will find that each scale's extension is of varying length. On the circular graph, some scales
extend a long away from the center of the circle while other segments are relatively short. Similarly, scales on the bar graph will vary in length. The
longer extensions indicate styles that are more prominent in your profile. By comparing the extensions, you will be able to find the thinking styles that
have the most impact on your own behavior.
The text printout on each scale provides you with detailed assessment and development information for each scale. For example, you might
find you have a high score on the humanistic helpful scale. You're told here that you are likely to enjoy developing, helping, and teaching others,
like to motivate others, and attempt to see the best in others. So far so good. However, on the oppositional scale your low score indicates a fairly
accepting agreeable type of persons. upto a point, these may be laudable traits for managers. but in terms of development, you should (the printout
says), “Beware of being too reticent about making critical comments” (which you will have to do as a manager). In summary, a computerized
management tool like ACUMEN can be very valuable, both for assessing management aptitudes (say, for future promotability) and for providing

58
detailed development advice for the trainee.

Computerized Performance Appraisal

More employers are turning to computerized performance appraisal systems today, generally with good results. Several relatively inexpensive
performance appraisal software programs are on the market, including Employer Appraiser (Austin-Hayne, $129), Review Writer (Avontos, $129).
and Performance. Now (Knowledgepoint, $169). All three enable managers to log notes on their subordinates during the year, and to rate employees
on a series of performance traits. The program generates written text to support each part of the appraisal.
Employee Appraiser, a software package for Windows, provides an illustration of how computerized appraisals are used. It presents the user
with a menu of more than a dozen evaluation dimensions, including dependability, initiative communication, decision-making, leadership, judgment,
and planning and productivity. Within each dimension are various performance factor, again presented in menu form. For example, under
"communication" are separate factors for writing, verbal communication, receptivity to feedback and criticism, listening skills, ability to focus on the
desired results, keeping others informed, and openness.
Once the user clicks on a factor, he or she is presented with a relatively sophisticated version of a graphic rating scale. However, instead of
numbers. Employee Appraiser uses behaviorally an chored examples. For example, for verbal communication, there are six choices, ranging from
“presents ideas clearly” to “lacks structure.” Once the manager picks the phrase that most accurately describes the worker. Employee Appraiser,
generates sample text. For example, if Juan's boss chooses “is sometimes unclear,” the program might generate the following text: “Juan usually
presents his ideas clearly and concisely. However, he sometimes uses terminology that is unclear to others. He would be more effective in his
communications if he used less jargon and fewer technical terms.
By the time the manager has moved through all the performance categories and sub factors. Employee. Appraiser has generated a solid,
detailed written report. The program's built-in text editor or another word processing program can then be
used to modify the report and add or delete comments and details.
One of the many useful features of Employee Appraiser is that it includes a log that can be used to collect critical incident events throughout

59
the year so that they're nut forgotten. These can then be stored In the Employee Appraiser program and used to provide specific back-up once the final
performance appraisal report is printed out.

Career Counseling
One of the thorniest problems a job hunter faces is the relative dearth of job search. As explained elsewhere, some employers have a policy of
retaining outplacement specialists for the purpose of providing career counseling and job search help to the employees they lay off. However, such
qualified outplacement specialist generally (though not always) deal exclusively with employer-paid assignments: You can't just walk into one and
have them help you. Beyond this, the field of job search help runs the gamut from the generally qualified college career counseling centers, which can
help you with your career choice, to the sometimes less-than-reputable "job search experts" who may charge an up-front fee of $2,000 or more and
give you very little in return.
Some human resource managers, realizing the shortage of qualified help but not able to commit to the substantial fees that outplacement
specialists often charge, provide computer-assisted programs to help discharged employees with their career and job search decisions. These
computerized programs are generally also available to any one who asks. They cost from $100 to $300.
One good example of such a computerized program is Career Navigator, for sale by outplacement specialist Drake bean Morin, Inc., 100 Park
Avenue, New York, New York 10017. The program contains both a comprehensive manual and a set of computer disks. It covers all the steps a job
searcher would normally go through, from identifying career interests through sending thank-you letters after a job is obtained.
For example, section 2 ("Know Yourself") takes you step by step through a program in which you identify your interests, define your values,
Identify your accomplishments, and identify your skills. Here you'll not only be able to zero in on several ideal job preferences; you will also generate
a list of accomplishment statements that will be useful for building your resume and conducting interviews later in your job search.
Succeeding sections of the program take you step by step through the job search itself. By interacting with the computer you will learn how to
use the telephone effectively, how to write effective letters (the program will actually print these out for you in the proper format), and how to
interview effectively. The computerized program will help you create your resume and will print it out for you (again in the proper format). And it will

60
help you organize a job research campaign plan and give you a computerized printout of weekly action plans. It will even assess your weekly progress.
It then gives you help in negotiating your offers, evaluating them, and even assessing the first three months on the new job.

Computerized Job Evaluations

As explained more fully in the appendix to this chapter, using a quantitative job evaluation plan such as the point plan can be a fairly time-
consuming matter. This is so because accumulating the information about “how much” of each compensable factor through an often tedious process in
which evaluation committees debate the level of each compensable factor in a job. They then write down their consensus judgments and manually
compute each job's point values.
According to one expert, CAJE-computer-aided job evaluation-can dramatically streamline this whole process. Computer-aided job
evaluation, she says, can simplify job analysis, help keep job descriptions up to date, increase evaluation objectivity, reduce the time spent in
committee meetings, and ease the burden of system maintenance. CAJE "features electronic data entry, computerized checking of questionnaire
responses and automated output—nut only of job evaluation, but also of a variety of compensation reports. Most CAIE systems have two main
components. There is a structured questionnaire. This contains items such as “enter total number of employees who report functionally to this
position. second, all CAJE systems are built around statistical models, which allow the computer program to price jobs more or less automatically
based upon inputted information on such things as prices of benchmark jobs, current pay, and current pay grade midpoints.
Another expert points out that CAJE does not replace but enhances traditional evaluation systems. He says that you still need a traditional job
evaluation system to provide "the initial solid analysis of benchmark jobs”-in other words, to identify the relative worth of these benchmark jobs. Then
CAJE “streamlines and speed the job evaluation process for ‘non-benchmark’ jobs.”

Estimating Offers Costs With Computers

Management students, whether they ultimately work for management or labor, are usually introduced to gaming-computer simulations that
answer what if questions. Sometimes they are as basic as looking at cash flow projections. These concepts may be applied to labor management

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negotiations. When labor suggests a 5% wage increase the first year, followed by 3% in each of the next two years, management counters with 3, 3, 5,
understanding that their proposal will cost less over the course of the three years. However, costing out other benefits may not be as easily understood.
Therefore, programs that rapidly calculate the direct and indirect cost of benefits offer the opportunity for more knowledge bargaining.
To quickly calculate the costs of offers or counteroffers, a simple table based on the percent of (1) each step in salary ranges, or (2) each
employee's annual pay, or (3) a particular benefit can be created. For example, if each wage step is 4% higher than the one below, and the first step of
each grade equals the middle step of the previous grade, simply changing the first grade's first step in the table of the wage plan will update it. Then by
linking this table to the rate each employee is paid (keyed to that table), the new total cost is available. If an employee is paid at the rate of step 4,
grade 3, a cell address next to that employee’s name tells the company what is budgeted for that employee, if that employee has worked an average of
100 hours overtime each of the three year a formula would be placed next to the employee name that includes the cell address plus the hourly rate (if
the wage plan is not in hourly figures) times 100 (to represent the 100 hours).
If one side suggests that the benefits package should be raised by 7% to include so many dollar for child care, the negotiator should have
available the number of employees who have expressed an interest in this benefit and how many children are involved as well as a range of possible
costs of child care in the area. By combining this information with current percentage of payroll is signed to benefit costs, it will be clear whether or
not the 7% is a realistic figure of probable costs. The negotiator might be willing to give 5% and with data of probable use and costs figured in unable
to negotiate a wording of the benefit that will better control costs, keeping them within the intended range.
Computers, then, help to prepare the negotiator for the bargaining sessions and could possibly shorten the time spent bargaining. If bargaining
is done off-site, portable or laptop computers with 30 or 40 megabyte memories provide support.

Appraisal Statistics
Remember that effective merit pay plans are always built on a foundation of fair and accurate appraisals. Some supervisors “grade” more
stringently than others. Some truly have mostly stars, and others are subject to the traditional rating errors. Comparing the results of various
departments or divisions may flag certain problems for closer examination.

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 After accumulating appraisal data from various departments and/or supervisors, extract the particular area(s) you would like to review. You
may extract more than one area at a time by sorting the data first by department (In ascending alphabetical order) and then by supervisor's last name
(again in ascending alphabetical order).
Then examine statistical averages and variances. Too little variance indicates a central tendency a supervisor who does not want to
distinguish between employees, so all are rated average. Looking at the minimum and maximum scores actually awarded will tell whether or not there
is a restricted range—in other words, another indication of little differentiation between employees. Of course, the range may be restricted on the high
side (an "easy grader") or the low side. If there is very little difference in ratings, then superior performances are not getting reinforcement and poor
performances are not being given clear expectations of what they must do to improve. Penley and Penley point out that small variance indicates”...
undifferentiated feedback to the employees.”
You may also wish to examine the timelines of appraisals. If your company policy is to appraise the employee on or before the anniversary of
hiring date, then that month and day are entered. In another column, enter the date the appraisal was actually done. By subtracting the appraisal date
from the hire date, you are able to quickly view the timeliness of appraisals. This is possible because packages such as Lotus 1-2-3 store Gregorian
dates based on the number of days since December 31,1899.
By analyzing the results of the appraisal process, it is possible to see problem areas that demand further training. Cleaning up these problems
may well be a prerequisite to installing an effective incentive plan.

Benefits Spreadsheets
Companies want to control benefits costs. One prerequisite is to be fully aware of how much the benefits offered are actually costing the
company on an ongoing basis. A benefits spreadsheet will provide this information.
The spreadsheet should list the following, all in separate columns: each employee (by name or number), the job code (so you can compare
benefits by job category in response to ERISA requirements); pay rate (annual, monthly, or hourly, since subsequent spreadsheet formulas will then
calculate the appropriate rate for the benefit being considered); department (if you wish to compare departments or divisions); and each benefit. In

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order to accurately track your current liabilities for benefits accrued but not used, list separate columns for liability and use of these benefits.
For example, suppose you want a report on accrued vacations. In the liability column, calculate the accumulation minus use, times current
hourly rate of pay. It is this column that will highlight how costly it is to allow employees to accumulate vacation or sick leave from year to year. If an
employee accrues at a rate of $10 an hour now but does not use the vacation time until retirement, the cost of those hours could easily double or treble,
as his or her pay rises.

Computers Assists Both Labor And Management

Both sides of labor-management relations may benefit from the use of computers. Management may track grievances to see where and on what
subjects training is needed. Labor may find that computers provide, new ways to assist members.
Management is able to track trends in grievances within any given time period for the whole company, a division or department, or a particular
supervisor or group of supervisors. For example, the researcher might hypothesize that supervisors with less than one year of experience in their
positions might generate more grievances than experienced supervisors. If this proves to be true, then either new supervisors should be trained before
starting in the position or should be offered frequent training sessions during their first year. However, research might prove that in some departments,
this hypothesis is not true. Thus, if there are a number of grievances from a large department, an investigation might reveal the need for (1) managerial
training, probably defined the subject of the grievances, (2) better communication on a topic (such as the importance of following safety rules), or (3)
the development of a process that allows more input from employees before instituting new policies. Grievance topics may be coded for easy
computer-tracking and may incorporate more than one code.
Labor, too, can benefit from computerization. With the demographic changes in the work-place, labor is searching for new ways to meet the
needs of its members and potential members. For example, computer-based networks nationwide would help to adjust the unemployment caused by
having skills in one location and jobs in another. As Hallett suggests, unions could become "the single best source of information, training, standards,
and individuals [with] specific skills and talents." With the support of international unions, locals could be linked effectively and relatively
inexpensively using telephone lines to provide this source of information, thus assuring their members a degree of job security.

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 For both management and labor, it is in the area of computerized costing that technology currently offers the best potential. As one expert put
it.
“Access to computer data banks has significantly shortened our research time prior to negotiations. And the application of software
spreadsheets has made contract cost analysis a much easier and more accurate process. In the future of collective bargaining, more development of
computer skills is a necessity.”
Computers are increasingly a necessity once negotiations start. For instance, as negotiators quickly review their demands, computerized
spreadsheets let both sides estimate how the changes may impact their costs. Thus, the cost of, say, an additional holiday can be quickly estimated.

Using Computers To Monitor Safety

Companies that must comply with state and federal laws (OSHA, RCRA, OSHA Hazard Communication Law, and SARA) are obligated to
file federal reports, monitor employee exposure to various hazards to note trends, and provide employees with information on hazards In their
workplaces. Computers can assist in all three areas.

Reporting Most federal forms can be formatted and formulated on a company's computer so that only the raw data need to be entered. The computer
will perform the instructed calculations and print out the results in an acceptable format. If a piece of Information has been input in error, only the
figure needs to be changed. Recalculations are automatic. With some forms, the typing of results takes several hours. This task is completed in minutes
with a computer. One of several programs available for providing the correct information in proper sequence is PRO-AM, by Safety, Inc.
Monitoring. Computers can track personal exposure level (PEL) for noise, particulates, vapors, or other contaminants for a given location, giving
timely warnings of trigger points. A dosimeter sensor can be plugged into a personal computer to translate readings on an hourly basis. Not only does
this protect, say, the hearing of workers; it can also spot equipment that needs servicing if, for example, a given decibel level indicates increased
friction. Trends of various hazards can also be plotted for work redesign to make the workplace safer.
Communicating The effectiveness of training in any area depends in part on the Hawthorne Effect: the degree to which the student feels that the

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training is important and accurate. When you communicate the hazards of a workplace, employees might not listen because they feel that they will not
be exposed to those particular hazards, or that they are already careful, or that their work situation does not support those safeguards. If the supervisors
push for results to the point of ignoring torn gloves, holes in respirators, inadequate ventilation, or workers who are not wearing safety glasses, then
employees will ignore the training. Also employees may not understand key parts of the training.
Interactive computers can help with some of these problems. If employees are assigned to work with a hazardous substance that was discussed
with them a few weeks before, their knowledge may have become hazy. Access to a personal computer can allow the employees to refresh their
memory on how to handle the substance and what to avoid doing. If there are words within the explanation that are not clear, an interactive program
will allow the employees to question that word (and any words In the subsequent definition) until they are ready to return to the original explanation.
How recently employees have reviewed the information correlates with the degree of retention, and computer-assisted instruction provides training any
time the employees need help.

E-LEARNING

Ready for E – Learning

-learning holds a lot of promise for training and development. But many companies aren’t using the technology to its full potential. “The
[typical] approach to e-learning is ‘here are a whole bunch of courses, good, bad, right, wrong. Pick and choose what you want from this
menu,’” says Mr. J. Rosenberg, author of e-Learning: Strategies for Delivering Knowledge in the Digital Age (McGraw-Hill, 2001).
What employees want and need, Rosenberg adds, are recommendations and an outline of a learning plan they can customize with their managers.

E-learning can do all that and more. Imagine a system that analyzes employees’ performances based on a system designed specifically for their jobs.

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Imagine that the system automatically spits out a series of recommendations—online courses, classroom training, books, mentoring—to address an
employee’s weaknesses. And imagine a system that increases manager accountability by tracking when he evaluates his employees, whether he has
produced a development plan and how the employee acts on that plan throughout the year.

That is exactly what the training department at Anheuser-Busch implemented. In 1997, the St. Louis, Mo.-based beer brewer introduced the
Wholesaler Integrated Learning (WIL) program to its 700 independently owned distributors and their employees, as well as to the 13 company-owned
branch operations and 12 breweries.

Prior to 1997, all training was live instructor-led classroom [training] at headquarters, in hotels or [at] wholesalerships nationwide.

An employee can access the WIL web site from anywhere and take a test that measures his proficiency
E-Learning vs. The Classroom in areas deemed important for his job description. The test is scored instantly, and the employee sees the
gaps between his abilities and those required for his position. The system then offers suggestions—
classroom training, online courses, books and on-the-job activities—on how to close those gaps. The plan report is linked to a list of available
resources and then to the enrollment system.

E-Learning vs. The Classroom

What are the primary benefits of e-learning over traditional classroom learning?
79% Availability of e-learning anytime, anywhere
59% Cost savings
59% Allows for self-paced learning
Source: e-Learning Magazine 2001 User Surve
Anheuser-Busch has expanded training and development opportunities to include several methods of delivery, such as interactive satellite—almost all
of it available at each employee’s workplace. WIL has grown from reaching 3,500 students to more than 32,000 distributor employees. Currently,
more than 20,000 users have completed competency assessments and are working on their assignments.
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The Logistics

To create WIL, Anheuser-Busch spent more than a year collecting information about job skills, knowledge and attributes to create a job competency
database.

“Core competencies are the same for everyone in the organization. And although every employee has specific competencies unique to their position,”
most competencies can be used for more than one job description, explains Scott Matthews, vice president of marketing and communication at Maritz
Learning, the e-learning division of Maritz Inc. in Fenton, Mo., which helped Anheuser-Busch create its program.

“Creating competency assessments is like a bunch of Lego blocks,” Matthews continues. “Once you have a database of all the skills, qualities and
knowledge that employees need, you assemble them to create unique job descriptions. If you create a new role or [if] an existing role changes, you
don’t have to re-create the system from scratch.” Instead, you can assign a value to a competency from the pool and build a new job description. For
example, although a marketing employee and a sales employee each require Microsoft PowerPoint skills, the sales rep may need a lower level of
proficiency than the marketing person.
“Once the organization takes the time and effort to build a competency model, it will have 70 [percent] to 90 percent of all the skills and competencies
Major Challenges to E – Learning needed within the organization. It may only need to tweak or customize this database for the last 10
[percent] to 30 percent,” says Matthews. Anheuser-Busch has about 200 different roles and almost 400
different competencies.

Rosenberg warns HR professionals not to get mired in creating competency models.

“The problem is that you could have thousands of roles in a company. We get hung up trying to prescribe learning plans for every possible
occurrence,” he says. To avoid getting bogged down, Rosenberg suggests consolidating job titles into general roles and letting employees and their
managers do the fine-tuning.

“Focus on the most critical elements. Look at top performers, and determine the skills and knowledge that [sets them apart],” recommends Brian
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Carlin, president of Maritz.

While it may appear that this type of system is out of reach for smaller companies, experts disagree. Theoretically, a smaller company would have
fewer job descriptions, so the time and costs associated with collecting core and unique competencies would decrease.

How long does it take to establish this system? “It depends on the number of job roles you have and how granular you want to get,” explains Carlin.
“If you start with off-the-shelf competency models, you can be off and running in a couple of weeks. If you want to do a completely customized job, it
can be three to six months [or more] to go through that process.”

Major Challenges to E-Learning

What are the major challenges to e-learning?

53% Lack of bandwidth
51% Cultural resistance
39% Lack of interaction
Source: e-Learning Magazine 2001 User Survey
That was true at TYCO/Mallinckrodt, a division of TYCO Healthcare in St. Louis, Mo. Each of the company’s
Develop E-Learning Content
job titles has a set of specialized competencies against which employees are evaluated, says Ed Grelle, senior
sales training manager. It took about six months to start Mallinckrodt University (MU), the company’s internal e-learning program, which was
developed three years ago to support the field sales organization. “But MU is an ongoing project with content modifications and new programs being
added all the time.” Currently, all the more than 1,000 field-based employees use the program.
Moreover, MU can offer personalized content to each employee. “Our LMS [learning management system] provides the capability of creating custom
libraries. We can provide only necessary content by job description to an individual. This makes the whole experience more personal,” says Grelle. For
example, the pharmaceutical sales force and imaging sales reps see different product modules in their libraries.

The e-learning program at AMD, a global semiconductor supplier in Austin, Texas, began in 1996 with a couple of internally developed computer-
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based training courses. “Our current offerings are now close to 160 web-based courses,” says e-learning team leader Bjian Masumian, Ph.D. “Our
LMS gives us the ability to allow registration and tracking of training. We use extracts from this system to show employee transcripts, learning plans
and courses currently registered for via our web site.”

Costs of developing and maintaining these systems vary, but Carlin says e-learning costs are decreasing. “You can either license all the [software] or
you can do it on a monthly basis.” Most customers prefer the monthly option. “Large companies can expect to pay between $5,000 and $20,000 per
month. Small companies can get a full-blown system for around $5,000 per month.”

Grelle says, “The original development and implementation of our system cost $250,000. That included an unlimited internal license, all
customizations to the site and an initial cost of some third-party content to enhance our library.”

Instruction vs. Knowledge Management

One of the most significant shifts occurring in e-learning is from programs that emphasize instruction—online and in the classroom—to those that
incorporate knowledge management and other forms of learning, such as on-the-job activities, apprenticeships and coaching, as well as reading of
online and offline resources.

“A learning plan could include work experience, research projects, mentorships [and] coaching,” says Rosenberg. He notes that people learn from a
variety of sources—newspapers, books, networking, the Internet, etc. So workplace training needs to be broadened and customized, he says.

Matthews adds, “A busy executive doesn’t have time for a two-hour course just to take away a learning nugget on a certain capability of a product she
is about to pitch to a client. To quickly identify and give people the information they need in small, highly digestible pieces is key.” He concedes that,
“this approach is not appropriate for everything, such as compliance issues,” but a factoid is often all the employee wants and needs.

Develop E-Learning Content

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How does your organization develop e-learning content?
58% Content is developed internally
49% Migrate existing materials
48% Combine existing materials with new content that is developed internally and externally with content
developers
Source: e-Learning Magazine 2001 User Survey
For example, Pamela Odino, a TYCO/Mallinckrodt imaging account manager, says the company’s e-
Measure the sucess of E-larning learning system allows her to view specific product information and refer back to it when she needs it,
such as right before she calls on a customer.
One reason Anheuser-Busch’s e-learning program has been so successful is that it has incorporated alternative learning activities, such as mentoring,
into its system. “One of the biggest things is the company identified and incorporated on-the-job activities which are appropriate [to the employee’s]
area of improvement into the system,” Matthews explains.

Evaluating Effectiveness

In addition to providing options for training, employees appreciate that they can do it on their own schedule. “I don’t mind going to the university, but
online is quicker,” says Odino, who has taken mainly computer and sales classes online. Her manager recently recommended two new online courses,
and she plans to work on them a little at a time. “I have children. I would rather dial up at 10:30 at night than try to go on a Saturday morning,” she
says.

Many companies are using such anecdotal evidence to evaluate the effectiveness of their programs in addition to analyzing cost-savings, increased
employee participation and employee performance improvement. “From three-day seminars, training has now evolved into a competency-based,
customer-focused learning experience,” says Anheuser-Busch’s Nolan. The result? “A nine-fold increase in attendee reach has been attained at an
overall savings.” Nolan cites cost reductions mainly on travel. “But perhaps the primary benefit is pertinent training in small chunks with no need to

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pull workers off the job for days at a time. Now employees participate in training that is specific to their needs rather than sit through an entire course
with multiple topics. Technology has provided the vehicle for true ‘just in time, just enough’ training exactly where it’s needed.”

At TYCO/Mallinckrodt, there have been multiple benefits. “In addition to reducing out-of-territory time dramatically, we are now able to monitor
individual development,” says Grelle. “One of the things we wanted to have in our system was customized content, especially as it relates to product
training. What used to take hundreds of three-ring binders is now easily managed and updated in one place. Consistency of training, reporting and
evaluating play a major role in employee development.”

For example: “Periodically, our training department will send out surveys. What used to get lackluster responses now get 90-plus percent responses,”
says Grelle. “The reason for this is the accountability factor. Because our field group knows that the system tracks this information, they are more
[motivated]. In the past, goals for development were often set for someone but may not always [have been] carried out. With this accountability, more
attention is paid to the rep’s development.”

Measure the Success of E-Learning

How does your organization measure the success of e-learning?

72% Employee feedback

46% Improved job performance
44% Tracking number of employees using online offerings
37% Bottom line results
Source: e-Learning Magazine 2001 User Survey

The Future of E-Learning

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One promising future e-learning model is based on the consumer archetype used by Amazon.com. If you buy a Dick Francis novel from Amazon, the
next time you log on, the system asks whether you would like to buy Dick Francis’ latest book or another mystery. Every time you buy from or even
browse Amazon, the system’s portrait of you grows, and the recommendations become more complex.

Thus, the ideal e-learning system would create a user profile that includes information you had recently accessed, courses you had completed and
projects on which you were working. Then it would suggest potential learning venues. The system might say, “Many individuals who work in your
part of the globe have found the following course, information or web site helpful.”

Jonathon Levy, vice-president of Harvard Business Online, a learning service provider in Waltham, Mass., explains. “The system would ‘push’ stuff to
you. If you’re going to have a difficult employee appraisal in two weeks, [information on appraisals] will get pushed to your desktop. The important
thing is how much you want to allow the database to look over your shoulder. You trade some level of functionality for privacy.”

Additionally, Matthews believes the future of e-learning lies in the assessment of not only what an employee knows but also his appropriate learning
style. “It will help me know whether I am a kinesthetic or visual learner, and then help me learn the material in the appropriate format.”

Ironically, the next step for e-learning is offline learning. “Training’s most important challenge is not just to personalize a training plan but to get
involved in all [educational] information used by the business,” says Rosenberg. “To treat documents, web sites, [mentoring] and courseware equally
and to bring together a robust list of materials from which employees can learn. That’s the next generation of e-learning.”

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 GLOSSARY OF TERMS
A
ANSI (American National Standards Institute) - The principal standards development body in the U.S.A. ANSI is a nonprofit, non-governmental
body supported by over 1000 trade organizations, professional societies and companies. It is the U.S.A's member body to ISO (International Standards
Organisation).
Application Link Software - Program developed to act as a link between an application program and a pre-defined data format. The data format may
be a fixed field format or a public or industry data format.
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Application-to-Application - Transfer of data generated by a computer program directly to another computer program. In EDI, these programs would
be housed in systems at trading partner sites.
Application Software - Programs that perform useful functions in the processing or manipulation of data; includes database managers, word
processors, text editors, spreadsheets, and other programs that enable the useful production of data.
ASCII (American Standard Code for Information Interchange) - Pronounced "asky". A system used to represent alphanumeric data; a 7-bit-plus-parity
character set established by ANSI X3.4 and used for data communications and data processing; ASCII allows compatibility among data services; one
of two such codes (see EBCDIC) used in data interchange, ASCII is normally used for asynchronous transmission.
Authentication - The verification of the source, uniqueness, and integrity of a message. Procedure to insure that data cannot be tampered with without
being detectable by the receiver.
Authentication Key - A group of characters which is used to initiate the authentication process. Each partner of a trading partner pair must have
possession of the same key.

B
Baud - Unit of signaling speed. The speed in baud is the number of discrete conditions or events per second. If each event represents only one bit
condition, baud rate equals bps. When each event represents more than one bit (e.g. digit), baud rate does not equal bps.
Bisynchronous Protocol - Set of conventions controlling synchronous transmission which defines the controlling start and end characters and the
error checking performed.
Bisynchronous Transmission - a byte- or character-oriented IBM communications protocol that has become an industry standard. It uses a defined
set of control characters for synchronised transmission of binary-coded data between stations in a data-communication system.
Bit (Binary Digit) - Contraction of "binary digit," the smallest unit of information in a binary system; a one or zero condition.
Bits/Second (bps) - the number of bits that pass a given point in a communication line per second. The basic unit of measure for serial data-

75
transmission capacity; Kbps for kilo (thousands of) bits per second; Mbps for mega (millions of) bits per second; Gbps for giga (billions of) bits per
second; Tbps for Tera (trillions of) bits per second.
Byte - A unit of information, used mainly in referring to parallel data transfer, semiconductor capacity, and data storage; also referred to as a
"character", usually shorter than a computer 'word'; a group of eight (sometimes seven) bits used to represent a character.
C
Communications - The means of electronically linking two computers to exchange information in EDI.
Communication Software - Programs that allow computers to communicate through MODEMS. Some are capable of automatic communications,
such as auto-dial and auto-answer.
Computer Application - Computer program or programs which solves a problem or performs a function. Example, the order/entry application
handles incoming purchase orders.
Cross-industry Standard - A data standard that has cross-industry application. EDIFACT is such a standard, with broad participation from many
industries and a requirement of public review prior to becoming a standard.
Cryptographic Equipment - Hardware or software that performs cryptographic functions (e.g., encryption, authentication, key generation)
Cryptographic Key - A parameter that determines the transformation from plain text to cipher text or vice versa. For example a DEA key is a 64-bit
parameter consisting of 56 independent bits and eight bits which may be used as odd parity bits.
D
Data - A general term to denote the basic elements of information which can be processed or produced by a computer. Information represented in
digital form, including voice, text, facsimile, and video.
Data Element - The basic units of information in the EDI standards and conventions containing a set of values that represent a singular fact. Data
elements may be single character codes, literal descriptions, or numeric values.
Data Link - Any serial data-communications transmission path, generally between two adjacent nodes or devices and without intermediate switching
nodes. A data link includes the physical transmission medium, the protocol, associated devices and programs, so it is both a physical and a logical

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link.
Data Message - An arrangement of data characters with appropriate communication's overhead, e.g., check characters, data identifiers, function
indicators.
Data Requirements - Describes those data elements needed by a computer application in order to process a specified business transaction.
Data Type - The characteristic of a data element that describes whether it is numeric, alphabetic, or alphanumeric.
Decryption - The process of transforming cipher text into plain
Dial-up Link - Dialed-up link over the switched telephone network.
DOS (Disk Operating System) - A set of programs that instruct a disk-based computing system to manage resources and operate related equipment.
Download - The transfer of data from a large computer to a front- end processor (smaller computer).
Downtime - The period during which computer or network resources are unavailable to users because of a failure.

E
E-Commerce Electronic Commerce has come to mean many different things to many different people. Originally, the term meant selling things
online. The term has evolved to mean conducting business online ( includes customer service functions, sales, marketing, PR, advertising, and more).
EDI Electronic Data Interchange - Inter company, computer-to-computer communication of data which permits the receiver to perform the function of
a standard business transaction and is in a standard data format.
EDIFACT - Acronym for Electronic Data Interchange for Administration, Commerce and Transport, the international EDI Standard as developed
through the United Nations.
EDI "Gateway" - The logical location of entry or exit of EDI data into/out of your company. A device having output and input channels through
which EDI communication of EDI data is affected.
EDI Readiness - An indicator to determine a firm's ability to physically accomplish and attain benefits from EDI based on the presence of computer
and communication hardware and application software.

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Encryption Key - A group of characters which is used to initiate the encryption process. Each partner of a trading partner pair must have possession of
the same key.
Error Detecting Protocol - A communications protocol having a procedure in place to detect when data received is not identical to that sent.
F
Flat File - A computer file where all the information is run together in a signal character string.
H
Header - The specific segment that, in simplest terms tells the receiving computer where an individual EDI message starts.
Hexadecimal - A Base-16 notation commonly used to represent binary values in computers and coding structures, such as ASCII, EBCDIC, and ISO
646.
I
Industry Specific - Useful to only one particular group of companies grouped together by a common area of endeavor. In EDI it refers to the ability of
an EDI standard to be used by only one industry.
Integrated Applications - A series of applications designed so that output of one application can be automatically fed into the next application with
no modifications or human intervention.
Interconnection - Transferring data from one third party service to another via communication link.
Interface - A shared boundary; a physical point of demarcation between two devices, where the electrical signals, connectors, timing and handshaking
are defined; the procedures, codes, and protocols that enable two entities to interact for a meaningful exchange of information.
ISO Acronym for the International Standards Organisation - An international organisation, working through the United Nations, that maintains the
standards for all applications of technology and mechanics for global industry.
International Standard - An ISO standards document that has been approved through the final balloting process.
ISO 646 - A seven-bit international coding structure for 128 different data characters. International equivalent to ASCII.
L

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Leased Line - A dedicated circuit, typically supplied by the telephone company, that permanently interconnects two or more user locations; generally
voice-grade in capacity and in range of frequencies supported; typically analog, though sometimes it refers to DDS sub-rate digital channels (2.4 to 9.6
Kbps); used for voice (2000 Series leased line) or data (3002 type); could be point-to-point or multi-point; may be enhanced with line conditioning;
also, private line.
Levels of Security - The various degrees of access to data in order to assure protection of computer-stored data.
Line Speed - See "Bits/Second".
Logon - A procedure for user access to a system involving identification, access control, and exchange of information between user and system.
Logon ID - The personally generated identification code used when logging on to a system, which permits the system to recognize the user. May be
associated with varying levels of security.
Loop - A group of semantically related segments. The NAD loop, which includes segments NAD to CTA for name and address information, is an
example of a loop. Loops may be nested within other loops. If the requirement designator of the first segment in a loop is mandatory (M), then at least
one iteration of the loop is required. If a loop is used, the first segment shall be used for each iteration of the loop. Mandatory segments within a loop
are mandatory only if the loop is used.
Looping - The repetition of a group of segments in a standard data format message set.
M
Mailbox - A logical partition of disk data storage in which all data sent to a particular recipient is stored until retrieved by that recipient. Mailboxes are
provided as a service by third party EDI service providers.
Mapping - The act of determining what pieces of information in the company's data base should be placed into each data element of an EDI message
or message set, or in reverse, what data elements of an EDI message or message set should be placed into the company's database.
Logical Mapping - The act of comparing a company data base to a set of standards
Physical Mapping - The act of programming a translation software package to relate a logical map to the mapping capabilities of the translation
software.

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Market Factors - Those situations outside of a company that influence its decision to implement EDI. For example, pressure from a major customer.
Mass Merchandiser - A large retailer, carrying a large variety of merchandise and competing for consumers mainly on the basis of price.
Material Release - A message set used by the automotive industry which acts as a release for product against an annually negotiated purchase order.
Message - A block of information in EDI making up a business transaction or part of a business transaction within an international standard
Modem (MOdulator-DEModulator) - A device used to convert serial digital data from a transmitting terminal to a signal suitable for transmission
over a telephone channel, or to re-convert the transmitted signal to serial digital data for acceptance by a receiving terminal.
N
Network - An interconnected group of nodes; a series of points, nodes, or stations connected by communications channels; the assembly of equipment
through which connections are made between data stations.
Network Architecture - A set of design principles, including the organisation of functions and the description of data formats and procedures, used as
the basis for the design and implementation of a network (ISO). A reference used for the definition and development of protocols and products for
inter-networking between data processing systems, often used to define a hierarchy of communication function layers.
Node - A computer or switching device situated at the point where two or more communications lines meet with both input and output circuits.
O
Operating System - The software of a computer that controls the execution of programs, typically handling the functions of input/output control,
resource scheduling, and data management (e.g., CP/M, MS-DOS, VM/370).
Operational "Window" - A pre-defined number of hours per day and days per week in which normal business can be transacted. In EDI, those hours
when data can be transmitted to a company directly.
Order - A request or commission to make or provide an item or service, e.g., purchase order, shop order, customer order, work order.
Order Entry Application - A computer program or group of programs, accepting data from an incoming order as input, validating its information,
and usually passing it to an order processing application.
Order Processing Application - A computer program or group of programs accepting a validated order from an order entry application, evaluating it

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in terms of available inventory, and generating an internal staging order for stock items with inventory availability and an internal order to a
manufacturing or assembly location for stock items with no inventory availability.
P
Paper-based Business Document - A business document whose information is printed on a paper form, For example, a purchase order or invoice.
Platform - The type of computer system being used.
Port - A point of access into a computer, a network, or other electronic device; the physical or electrical interface through which one gains access; the
interface between a process and a communications or transmission facility.
Proprietary Ordering System - A group of programs developed and owned by a supplier, which is offered to its customers to handle ordering.
Usually, such a system is interactive.
Protocol - Formal set of rules governing the format, timing, sequencing, and error control of exchanged messages of a data network; may be oriented
toward data transfer over an interface, between two logical units directly connected, or on an end-to-end basis between two users over a large and
complex network. Simple protocols define only hardware configuration. More complex protocols define timing, data formats, error detection, and
correction techniques.
Protocol Conversion - For computers with different protocols to understand each other meaningful conversation needs to take place. Many VANS are
equipped to allow conversations between different 'tongues'.
Public Switched Network - Any switching communications system such as Telex, TWX or public telephone networks - that provide circuit switching
to many customers.
Purchase-Pay Cycle - Period of time from generation of a purchase order, through receipt of ordered product, to payment for that product.
Purchasing Transaction - One of many transactions containing information relating to the purchase of a product or service. For example, purchase
order, purchase order change, purchase order acknowledgment.
Q
Queue - Any group of items, such as computer jobs or messages, waiting for service.

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Queuing - Sequencing of batch data sessions.
Quick Response (QR) - A retail philosophy developed by VICS, permitting the receipt of goods from suppliers at the retail site based upon the sales
of the supplier's goods that are transmitted to the supplier on a periodic basis. Sales are generally recorded using bar codes and transmission between
retailer and supplier occurs through the use of EDI standards - X.12 in the US and EDIFACT in Europe.
R
Remote Job Entry (RJE) - Executing a program or group of programs by entering a series of commands to a computer from a remote source.
Response Time - The elapsed time between the generation of the last character of a message at a terminal and the receipt of the first character of the
reply. It includes terminal delay and network delay.
S
Sales Reporting - (CompTIA) - The process by which a seller of product advises the supplier of the product what product was sold in a given time
frame. May also include the identity of the customer to assist in issues such as warranty registration.
Segment - (see data Segment) In a standard data format, a unit of a message set made up of related data elements.
Mandatory (M) - This segment shall appear in the message set at least once.
Optional (O) - The appearance of this segment in the message set is either at the option of the sending party or is based on the mutual agreement of
the interchange parties.
Segment Sequence - Each segment is assigned a specific position in the segment sequence of a message set as denoted in the tables to the left of the
segment identifier.
Segment Terminator - As related to a standard data format, the character that defines the end of a data segment.
Sell-In (CompTIA) The sale of product from a manufacturer of a product into the CompTIA channel of distribution, except for direct sales to end-users.
Sell-Through - (CompTIA) The sale of product between inventory holders, e.g., distributor to reseller.
Sell-To - (CompTIA) The sale of product from manufacturer or inventory holder to an end-user, e.g., reseller to end-user, distributor to end-user,
manufacturer to end-user.

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Serial Transmission - The most common transmission mode; in serial, information bits are sent sequentially on a single data channel.
Session - A connection between two stations that allows them to communicate; the time period that a user engages in a dialogue with an interactive
computer; in the IBM SNA, the logical connection between two network-addressable units.
Standard Business Transaction - A business procedure between trading partners which accomplishes a specific purpose. For example, relaying the
intent to purchase goods. Many transactions are characterized by the paper document which was developed to communicate the data requirements to
the trading partner, i.e. the purchase order. EDI message sets are designed to accomplish this same goal using a standard machine-readable data format.
Store and Forward - Pertaining to communication systems in which messages are received at intermediate routing points and recorded (stored). They
are then transmitted to a further routing point or to the ultimate recipient.
Synchronous Transmission - Transmission in which data bits are sent at a fixed rate, with the transmitter and receiver synchronised. Synchronised
transmission eliminates the need for start and stop bits.
Syntax - The grammar or rules which define the structure of the EDI standards (i.e., the use of loops, qualifiers, etc.) Syntax rules are published in
EDIFACT documentation.
System - Term applied to the range of component parts which allow information processing.
Systems Architecture - The defined arrangement of the various components to provide a working computer system.
T
Telco - Telephone central office, in most usages; but also, a generic abbreviation for "telephone company."
Telecommunications - A term encompassing transmission or reception of coded signals, writing, sounds or intelligence of any nature by wire, radio,
light beam or any other electromagnetic means.
Telecommunication Port - Entry channel through which data is communicated. A port is part of a central computer system.
Third Party Service Provider - A company which acts as a communications intermediary between EDI trading partners, providing communications
services such as line speed conversion, and protocol matching as well as electronic mailbox, translation, and other services.
Trading Partners - The entities among which EDI is carried on. This may be either the sender or receiver of information in EDI or all the members

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within the channel of distribution within an industry. Example, customers, suppliers, carriers, banks.
Transaction - An exchange conducted, performed or carried out between two (or more) parties that accomplishes a particular action or result. In
communications, a message destined for an application program; a computer-processed task that accomplishes a particular action or result; in
interactive communications, an exchange between two devices, one of which is usually a computer; in batch or remote job entry, a job or job step.
Translation Software - A program or group of programs that decode, format, provide for protocol conversion, and may map data between an
application data format or a pre-defined fixed-field data format to a standard data format.
Transmission - The dispatching of a signal, message, or other form of intelligence by wire, radio, telegraphy, telephony, facsimile, or other means; a
series of characters, messages, or blocks, including control information and user data; the signaling of data over communications channels.
U
UCC - Abbreviation for Uniform Code Council overseeing the implementation of UPC and related bar code standards within the retail, commercial,
and industrial markets. The UCC is also the source and coordinating body for VICS.

Utility Software - Programs that make operation of a PC or LAN more convenient, including programs to move disk files more easily, diagnostic

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programs, etc. Compare with application software.
W
WWW - Abbreviation for "world wide web". What most users think of when you say "the internet".
X
X12 - The ANSI committee responsible for the development and maintenance of standards for Electronic Data Interchange in the US.
X12.5 - Interchange Control Structure - This standard provides the interchange envelope of the header and trailer for the electronic interchange through
a data transmission, and it provides a structure to acknowledge the receipt and processing of this envelope.
X12.6 - Application Control Structure - This standard describes the control segments used to envelope loops of data segments, transaction sets, and
groups of related transaction sets.

BIBLIOGRAPHY

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1. www.hbinteractive.com
2. www.shrm.org
3. www.tab.com
4. www.webdevelopersjournal.com
5. www.zdnet.com
6. Marketing Management by Philip Holster.
7. Human Resource Development by Garry Dessler.
8. Strategic Marketing Magazine (May –July-2001).

4
human resource
development

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