Integrated Case Study

• Presented By: M.Dimuthu Suranjana

(BSc. Business. Administration (Sp) hons-USJ, FCA, MBA (PIM-USJ),
FMAAT, ACMA, ACPM, CIMA (U.K)-Passed Finalist, Post.gra.dip. in
Business & Finance Administration-CA Sri Lanka, Post.gra.dip.in
Corporate & Strategic Finance-CA Sri Lanka, Cer.in Cyber Security
(ISACA), Cer.in Digital Marketing (SLIM),)

M.D.Suranjana 1
 Business and Functional Strategy-20%
4.1 Business Strategies and Competitive Advantages- Porters Generic
Strategies, Strategic Clock, Game Theory, Blue Ocean vs. Red Ocean, etc.
4.2 Functional Strategies- Strategies for Marketing Management (STP and
marketing mix), Strategies for Managing Human Capital and Emotional
Intelligence, Strategies for Information Management Strategies for
Technology and Innovation Management (Research and development
strategies)
4.3 Technology in Business- Applications of Big data & Data Analytics,
Machine Learning & Artificial Intelligence, Applications of Social Media and
online Business, Applications of Fin Tech
4.4 Strategy and Risk- Assessing the appropriateness of strategy in terms
of risk inherent in strategy Aligning risk with strategy and performance
4.5 Risk Analytics and Big data- Understanding the importance KRIs
beyond historic KPIs and ability to propose KRIs for a given business
scenario, Understanding the importance bigdata (structured and
unstructured) and business intelligence software with predictive
capabilities
M.D.Suranjana 2
 1.Strategic choices
• Competitive strategies- Competitive strategies
are the strategies an organization will pursue for
competitive advantage. They determine how you
compete.
• Product-market strategies- Product-market
strategies determine where you compete and
the direction of growth
• Institutional strategies- Institutional strategies
determine the method of growth – for example,
by organic growth or through mergers and
acquisitions. These strategies are decided at the
corporate level
M.D.Suranjana 3
 2.Strategy formulation
1.Strategy formulation at the level of the SBU (the business
level) is concerned mainly with decisions about products and
markets.
2.Porter has suggested there are three generic business
strategies:
i) Cost leadership- lowest cost producer in the industry as a
whole.
ii) Differentiation- creation of factors that make a product
different
iii) Focus- Doing business in small portion (Niche) of the
market
•Providing goods and/or services at lower cost to that
segment (cost-focus)
•Providing a differentiated product or service to that
segment (differentiation-focus)
M.D.Suranjana 4
 Ways of reducing costs to achieve cost
leadership
• Economies of scale -This is a critical factor in achieving cost
leadership within the industry.
• Use the latest technology to improve productivity -Technology
such as computer aided design and computer aided manufacture
(CAD/CAM) can help to reduce unit costs of production.
• Minimize overhead costs- Eliminate unnecessary spending. Large
volumes of output will reduce the average fixed overhead cost
per unit.
• Favorable access to sources of supply -Get favorable access to
sources of supply, and buy in bulk, in order to obtain discounts for
bulk purchases.
• Relocate operations to a cheaper area- Possibly relocate
operations to a country where costs, including labor costs, are
cheaper.
• Use of IT - Using IT systems can reduce operating costs and
improve management information.
M.D.Suranjana 5
 Ways of differentiating a product or
service
Product Give the product special features to make it clearly different
design (and more attractive) than rival products. Quality and style can
be important distinguishing features for a product.
Brand Build a brand image, perhaps through marketing, so that
image customers see the brand as something desirable.
It has been suggested, however, that the value of a brand in
creating differentiation is not as effective now as in the past.

Advertising Advertising may be used to enhance customer perceptions of a

product or service.
Distribution It may be possible to differentiate a product in the way that it is
made available and delivered to the customer. The great
success of Amazon, for example, began with its unique strategy
of online selling and rapid delivery to the customer's address.
M.D.Suranjana 6
 Internal factors Required to apply
differentiation strategy
Access to leading Research allows new ideas, concepts and
scientific techniques to be discovered and created
research
A highly skilled and A highly skilled and creative product
creative development team can take the concepts
product development and ideas developed by the research team
team and use them to develop products and
services that satisfy customers needs.

A strong sales team with A strong sales team can encourage

the ability to successfully customers to appreciate and desire the
communicate the features of the new products and services,
perceived and ultimately be willing to purchase them.
strengths of the product M.D.Suranjana 7
 3.Strategy Clock
• Strategy clock: a model for analyzing competitive
strategies, according to different combinations of
price and value for the customer.

M.D.Suranjana 8
 Strategy Clock
No frills strategy
• A no frills strategy combines a low price with low
perceived product/service benefits.
• A no frills strategy is appropriate for commodity-like
products or for markets where customers are very price
conscious. It is also suitable in markets where there is little
opportunity for competition on product features. Car fuel
may be an example.
• A no frills strategy may be used for market entry, to gain
experience and build volume. If the market leaders are
competing on other bases, a no frills strategy may give new
entrants a way of establishing themselves in the market
before moving on to other strategies.

M.D.Suranjana 9
 Low price strategy
• A firm pursuing a low price strategy aims to
offer better value than its competitors. It
seeks to do this by offering the same
perceived product or service benefits as its
competitors, but at a lower price.
• Porter's generic strategy of cost leadership is
comparable with this strategy on the strategic
clock
• This is more appropriate in Mass Market

M.D.Suranjana 10
 Hybrid strategy
• A firm pursuing a hybrid strategy seeks both
differentiation and a lower price than its
competitors. The firm's cost base must be low
enough to permit reduced prices and yet still
retain high enough margins to be able to
reinvest.
• Reinvestment is necessary to maintain
differentiation

M.D.Suranjana 11
 Broad differentiation strategy
• seeks to provide products or services that offer
benefits that customers value and that are
different from competitors' offerings.
• The basic differentiation strategy can be achieved
in two ways:
(a) Offering better products or services than
competitors at a higher price (price premium), to
enhance profit margins.
(b) Offering better products or services at the same
price as competitors (competitive price), in order to
build market share
M.D.Suranjana 12
 Focused differentiation strategy
• A firm pursuing a strategy of focused
differentiation seeks a high price premium in
return for a high degree of differentiation in a
well-defined and probably quite restricted
market segment (niche). Focused
differentiation strategies are often used for
premium products that are heavily branded.
• Focus is a common start-up strategy

M.D.Suranjana 13
 4. Blue ocean and red ocean strategies
• Blue ocean strategy is a strategy that involves
finding innovative ways of creating value for
the organization and its customers by finding
undiscovered industries or markets.
• Red ocean strategy is a strategy of competing
in known and existing markets.
Red Ocean Blue Ocean
Focus on Existing Customers Focus on Non-Customers
Compete in Existing Market Create uncontested market to serve
Beat the Competition Make the competition irrelevant
Exploit Exiting Demand Create and Capture New Demand

M.D.Suranjana 14
 Value Innovation in Blue Ocean
• Blue ocean strategies are a source of value
innovation. This is simply a term for providing
cost benefits to the organisation and also
adding value for customers.

• Cost benefits are achieved through the

increase in sales, and customers receive value
benefits in the form of innovative and superior
products.

M.D.Suranjana 15
Value Innovation in Blue Ocean..

M.D.Suranjana 16
 How are blue ocean strategies
developed?
Reduce Which factors should be reduced below the industry
standard?
Which factors yield little or no competitive advantage?
Reduce activity in this red ocean strategy area.
Create Which factors should be created that the industry has not
offered before?
Look for value innovation.
Raise Which factors should be raised above the industry standard?
Put greater value on factors that will provide more
competitive advantage.
Eliminate Which factors that are taken for granted should be
eliminated because they have little or no value?

M.D.Suranjana 17
 5. Competitive strategies based on
market position
• An alternative method of selecting a business
strategy is to decide how to position the
organization’s product in the market, in terms
of how customers think of the product and
compare it with rival products.
• A positioning strategy is based on
understanding the market and customers, and
influencing customer perceptions of the
company's product.

M.D.Suranjana 18
 6. Strategic behavior and competitive
markets: game theory
• Game theory is a term for an approach to the study
of optimal decisions, taking into account the
decisions of competitors, who are other 'players in
the game.
• There are two strategic options
1. A dominant strategy- is a strategy that is better for
an organization than any other alternative strategy,
no matter how competitors respond.
2. A dominated strategy- is an alternative strategy that
should not be selected, because there is a better,
dominant strategy that can be chosen.
M.D.Suranjana 19
 Nash equilibrium
• Nash equilibrium: a situation identified in game theory
where no player in the game has an incentive to deviate
from their chosen strategy, after considering the
opponent's choice.
• The basic idea is that the outcome from a strategic choice
cannot be predicted if it is considered in isolation. It is
necessary to ask what each competitor would do, taking
into account the strategic choices of all the other
competitors.
• An equilibrium strategy is one where none of the
competitors can benefit by changing their strategy as long
as the other competitors keep their strategies unchanged. It
therefore represents the strategy that will be selected by
each competitor
M.D.Suranjana 20
 7.Marketing
• 'the activity, set of institutions, and processes for
creating, communicating, delivering, and
exchanging offerings that have value for
customers, clients, partners, and society at large'
(2017)-American Marketing Association
• 'the science and art of exploring, creating, and
delivering value to satisfy the needs of a target
market at a profit- Philip Kotler

M.D.Suranjana 21
 7.1: Segmentation
• Marketing strategies for a company's product are
based on the concepts of segmentation, selecting a
target market and positioning the product within the
target market.
• A market segment is simply a group of potential
customers that have been identified for a product,
who appear to have similar needs and interests.
• Market segmentation is 'the subdividing of a market
into distinct and increasingly homogeneous
subgroups of customers, where any subgroup can
conceivably be selected as a target market to be met
with a distinct marketing mix‘-Kotler
M.D.Suranjana 22
 7.2:Identifying market segments for
consumer goods
Geographical Geographic segmentation is when a business divides its market on the
Segmentation basis of geography. This includes a market by area, such as cities,
counties, regions, countries, and international regions.
Lifestyle This is based on how people see themselves and their attitudes towards
Segmentation a particular product or service, or towards their life in general.
E.g.: interests, activities, personality & opinions of individuals.
Socio- A market may be segmented according to the age of potential
demographic customers, their position in society and their social or religious
segmentation background.
E.g.: Age, Religion, Gender, Ethnicity/national origin, Income, Social
class, Occupation, Family size, Education

Behavioral A market may be segmented according to the way that different

segmentation customers respond to, know about or use a product
E.g.: Occasion, Volume of Usage, Loyalty, Benefits the customers are
seeking M.D.Suranjana 23
 7.3: Reasons for segmenting markets
Reason Comment
Better satisfaction The same product will not satisfy all customers. A company
of should identify the segment of customers who may buy its
customer needs products, or it must develop products that appeal to a
specific segment of the market.

Growth in revenue Some customers will pay more for certain features of a
and profits product. By targeting a product at a specific segment of the
market, a company can hope to sell more successfully than
competitors and make more profit.

Targeted Segmentation means that communications with targeted

communications customers (advertising and sales promotions) can seek to
appeal to their particular needs and values

Innovation By identifying unmet needs of an identified market segment,

companies can innovate and develop variations of a product
to satisfy them.
M.D.Suranjana 24
 7.4: Segmentation, targeting and
positioning (STP)
• The purpose of market segmentation by
companies is to identify the segment or
segments that will be targeted with marketing
activities
• Segment validity- A market segment should
be targeted only if a company thinks that it is
sufficiently large that it is worth designing and
developing a unique marketing mix for that
specific segment

M.D.Suranjana 25
 7.5:Qualities of a good segment
MASDA Factor Comment
Measurable It should be possible to measure the total number of
potential customers in the segment.
Accessible It must be possible to market a product (with a
unique marketing mix) to the market segment.
Substantial The segment needs to be large enough to offer the
possibility of making a profit from selling to it
Differentiable It should be possible to differentiate the market
segment clearly from the rest of the (broader) market
that it is part of.
Actionable The producer needs to be in a position where it can
take action to market its products to the target
market
M.D.Suranjana 26
 7.6: Target markets
• Target markets are the market segments that
are chosen by a company for marketing their
products.
• A target market can be approached with a
marketing mix that is specifically designed for
potential customers in the target segment.

M.D.Suranjana 27
 7.7:Marketing strategy and target
Markets
Undifferentiat This policy is to produce a single product and
ed hope to get as many customers as possible to
marketing buy it; that is, ignore segmentation entirely. This
is usually based on offering the cheapest prices.
Concentrated Company attempts to produce the ideal product
marketing or for a single segment (or 'niche') of the market.
niche
marketing
Differentiated The company attempts to introduce several
marketing product versions, each aimed at a different
market segment.

M.D.Suranjana 28
 7.8: Positioning
• The market position of a product defines how the
company wants customers to perceive it, and
how the product differs from other competing
products in the market.
• There are two ways of obtaining competitive
advantage
1. Cost leadership-Selling good at lowest price
2. product Differentiation-making the product
different from rival products in the mind of
potential customers.
M.D.Suranjana 29
 7.9: Map of product positioning
• A map of product positioning can be used to
identify gaps in the market.
• This will help a company to identify a
potentially profitable and distinctive way of
positioning its own product in the target
market.

M.D.Suranjana 30
 7.10. The Marketing mix
• The marketing mix is basically the combination of
factors that marketing managers put together, to
make products that meet the needs of different
customers, price them, inform potential
customers about them and deliver them to
customers who want to buy.
• These are the controllable variables of a Marketer.

M.D.Suranjana 31
 7.11: Marketing Mix…..
The 4 ps Aspects of marketing
Product What is the basic or core product/Features
How might the product line be extended, to include more products
that customers will buy?
Price What should be the price for the product? Need to balance price
and expected sales demand in order to optimize profit.

Place This is the communication of the marketing proposition to

potential customers, through direct selling, advertising, sales
promotions, e-communications, public relations and direct
marketing.
Promotion Place is where customers are able to buy the product.
Channels of distribution include retail outlets, online purchases
with delivery to the customer's home, vending machines and so on

M.D.Suranjana 32
 7.12: Managing products and brands
• A product is a 'package' of benefits that satisfies a set of
'wants' that customers have. The package of benefits
includes:
• (a) A physical aspect, which relates to the components,
materials and specifications (such as color and size) of the
product.
• (b) A functional aspect, which is a statement of how a
product performs and for what purpose it is likely to be
bought.
• (c) A symbolic or status aspect, which represents the
qualities the product suggests to, or confers on, the buyer
• The concept of 'product' embraces:
• Product quality and durability • Product design • Brand
name • Logo • Packaging • The product range • After-sales
service • Optional extras • Guarantees and warranties
M.D.Suranjana 33
7.13: Product line and product mix
• A product line is a range of related products
that a manufacturer may produce.
• A product mix refers to the number of
different products or product lines that a
producer makes.
• product width is the many different lines the
producer makes .
• Length of a product refers to Total Number of
items in the product line.
• Depth of a product refers to number of
version offered of each product in the line
M.D.Suranjana 34
 7.14: Brand Management
• A brand is a product or product line (mostly for
consumer products) that is marketed by a
company under a particular name.
• A brand may in fact be any of the following:
➢ A name (displayed in a particular lettering
style)
➢ The producer's company name (such as Coca-
Cola)
➢ A pictorial design
➢ A symbol
M.D.Suranjana 35
 7.15: Advantages of a brand
• brand name of product helps to establish the
expectations of customers about the branded
items.
• Brands can create customer loyalty and
motivate the buyer to purchase the branded
product instead of rival.
• Brand has the ability to extend the branded
product range to new products.

M.D.Suranjana 36
 7.16:Brand Meaning
• Elements of a brand-These are the name,
logo, color, shape, letters and images that
make up the visual brand.
• Attributes of a brand-attributes that are
associated with a brand may relate to design,
performance, quality, value or taste.
• Benefits from a branded product-Attributes of
a brand are translated into a combination of
perceived functional or emotional benefits
from a product in the brand product line.
M.D.Suranjana 37
 7.16:Brand Meaning……
• Values-A brand may be associated with
particular values, such as value for money, high
performance, safety or prestige.
• Culture-A brand may suggest the culture of the
producer's organization.
• Personality-A brand may suggest a personality
of the buyers of the branded product.
• User-A brand name may indicate the type of
consumer who is likely to buy and use the
product
M.D.Suranjana 38
 7.18:How to protect the brand
• Making sure that all new products added to
the branded product line meet the same
quality standards as the existing branded
products.
• Promoting the brand to maintain its image in
the mind of potential customers.
• Taking legal action against any other company
that tries to imitate the company's brand, but
selling lower-quality products.

M.D.Suranjana 39
 7.19: Requirements for successful
brand positioning
• Relevance-The branded products should be
positioned in a way that has meaning for
consumers and meets consumers' needs
• Clarity-The 'meaning' of the brand should be
distinct, and should be easy to communicate to
consumers and easy for consumers to
understand.
• Coherence- The same 'image' of the brand should
be promoted consistently through all aspects of
the marketing mix.
• Patience- It can take a long time to establish a
successful brand.
M.D.Suranjana 40
 7.20: Brand equity
• Brand equity is the value of a brand name.
• The owner of a well-known brand is able to sell
products in the basis of the strength of the brand
name.
• Using the brand for product line extension can
also be a successful way of creating more sales
and profits.
• Although a successful brand definitely has value,
it is difficult to measure the financial value
(market value) of a brand.
M.D.Suranjana 41
 7.21: Pricing strategies
• Pricing strategy is concerned with deciding the
price level at which a company should try to
sell its products.
• pricing is the only element of the marketing
mix that generates income, revenue and
profits, rather than creating costs.
• Price can go by many names, including fares,
fees, rent and assessments.

M.D.Suranjana 42
 7.22: The role of price in the
marketing mix
• price is the only element of the mix that
generates revenue rather than creating costs.
• Price can be important for differentiating a
product or brand from competitive products; this
enables a company to exploit market
opportunities.
• Pricing must be consistent with the other
elements of the marketing mix, since it
contributes to the overall image created for the
product.
M.D.Suranjana 43
 7.23: Pricing strategies
1. Demand-based strategies-This recognize the relationship
between price and demand, and the Selected price is one
that seeks to achieve an optimum balance between them
– possibly a profit-maximizing price.
For innovative products that are introduced to a new market,
a company may select one of the following demand-based
strategies:
• A market penetration pricing strategy- This is to set the
price of the new product low to sell many units.
• price skimming strategy-This strategy is to charge a very
high price for a new product. Customers have to pay the
high price. Although sales volumes will be low, unit profit
margins should be high.
M.D.Suranjana 44
 7.24: Pricing strategies…….
2.Price discrimination- A company may sell the
same product to customers in different markets at
different prices, in order to maximize revenue. Price
discrimination is successful only if customers in one
segment are unable to buy the product in the
cheaper segment.
3.Product mix pricing-A company that sells a
branded product line should price all the products
in the range consistently, in order to promote the
image and position of the brand.
M.D.Suranjana 45
 7.25: Place: distribution Channel
management
• Place is concerned with the selection of distribution
channels used to deliver goods to the consumer.
• 'Place' in marketing therefore refers to:
➢ Distribution channels, and the choice of distribution
channels.
➢ Distribution coverage, and the number or spread of
distribution channels.
➢ Locations of sales outlets, the arrangements of sales
areas or sales offices.
➢ Outward logistics. M.D.Suranjana 46
 7.26:Territorial rights
1. Extensive distribution-The manufacturer seeks to
sell its goods through as many retailers as possible.
e.g.: commodity goods such as Chocolates, soft drinks
2. Selective distribution-The manufacturer uses a
limited number of intermediaries to distributing its
goods and selling them to the end customer. e.g.:
Fashion clothing
3. Exclusive distribution-The manufacturer gives
exclusive distribution and selling rights to one
organization. e.g.: Ferrari cars
4. Direct distribution-A manufacturer may sell direct to
consumers through online sales and the internet
M.D.Suranjana 47
 7.27: Promotion Strategies
• Promotion covers all marketing activities that are focused
on letting customers know about a product or service and
persuading them to buy it.
• Promotion can take many forms and generally operates at
one of three levels:
(a) Non-personal and mass promotions: these are aimed at a
large segment of a target market.

(b) Personal and direct promotions: these are typically one-

way communications with potential customers (for example, a
letter to the individual, delivered by mail).

(c) Personal and interactive, involving some dialogue between

the sales person and the potential customer. This may involve
face-to-face selling or sellingM.D.Suranjana
by telephone 48
 7.28: The promotional mix
• The promotional mix is the combination of
activities used by marketing managers to promote
a product or service.
• The basic promotional mix consists of advertising,
sales promotion, personal selling and public
relations (PR), but new promotional methods are
emerging, especially by means of information and
communication technologies.

M.D.Suranjana 49
 7.29:The marketing communications
mix
(a) Personal selling- is selling by sales
representatives ('salesmen'), either through
face-to-face meetings with potential customers
or by telephone.
(b) Direct marketing -involves sending sales
promotion material, such as brochures, direct to
potential customers. The marketing material
may be sent by post or by email.
(c) The design of packaging- may help to promote
sales of some consumer products.
M.D.Suranjana 50
 The marketing communications
mix…..
(d) Sponsorship- involves providing financial
support for sports events.
(e) Public relations (PR) -involve trying to get
favorable news reports about a firm in the media.
(f) Point-of-sale displays -are displays of a firm's
products at a place, usually within a retail store,
where customers are likely to see them.
(g) Advertising- is a well-established method of
marketing products.
M.D.Suranjana 51
 7.30: Advertising
• Advertising is 'any paid form of non-personal
presentation and promotion of ideas, goods or services
by an identifiable sponsor' (American Marketing
Association).

• Advertising can have any of the following purposes:

➢ To help the sales representatives to make sales
➢ To stimulate demand for the product
➢ To promote a specific brand
➢ To counteract the promotional activities of a
competitor
➢ To remind consumers about the product

M.D.Suranjana 52
 7.31: Sales promotion
• Sales promotion means 'a range of tactical
marketing techniques, designed within a
strategic marketing framework, to add value to
a product or service, in order to achieve a
specific sales and marketing objective'
• These may include Reduced price, coupons, gift
with purchase, competitions & prizes,
Premiums, Money refunds, Frequent user
incentives, Point of sale display.

M.D.Suranjana 53
 7.32: Public relations (PR)
• Public relations (PR) is 'the function or activity
that aims to establish and protect the
reputation of a company or brand, and to
create mutual understanding between the
organization and the segments of the public
with whom it needs to communicate' .
• Typical PR activities involve maintaining strong
relations with the media, managing news
events and ensuring that a company presents
a consistent corporate communications
message.
M.D.Suranjana 54
 7.33: Direct marketing
• Direct marketing consists of 'all activities which make it possible
to offer goods or services or to transmit other messages to a
segment of the population by post, telephone, e-mail or other
direct means'

(a) Direct mail (DM): a personally addressed 'written offering'

(letter and/or sales literature) with some form of response
mechanism, sent to existing customers from an in-house database
or mailing list.

(b) Email: messages sent via the internet from an email database
of customers. Emails can offer routine information, updates and
information about new product

(c) Mobile phone text messaging (SMS): messages can be sent via
mobile phone to a captive audience, catching them wherever they
are. M.D.Suranjana 55
 Direct marketing…….
(d) Mail order: brochures typically contain a selection
of items also available in a shop or trade outlet, which
can be ordered via an order form included with the
brochure and delivered to the customer.

(e) Catalogue marketing is similar to mail order, but

involves a complete catalogue of the products of the
firm, which typically would not have retail outlets at all.
Electronic catalogues can also be downloaded on the
internet.

(f) Call centers and telemarketing: a call centre is a

telephone service responding to or making telephone
calls.
M.D.Suranjana 56
 7.34: Personal selling
• Personal selling is the presentation of products
and persuasive communication to potential
clients by sales staff employed by the supplying
organization.
(a) Personal selling, or sales force activity, must be
undertaken within the context of the
organization’s overall marketing strategy.
(b) Conversely, with a 'push' strategy, the
organization will rely primarily on the sales force
to persuade marketing intermediaries to buy the
product.
M.D.Suranjana 57
 7.35: Elements and tasks of personal
selling
• The opening
• Need & problem identification
• Presentation and demonstration
• Dealing with objections
• Negotiation
• Closing the sale.

M.D.Suranjana 58
 8.Human Resource Management
• Human Resource Planning
• Recruitment, Selection & Socialization
• Employee Motivation
• Training and Development
• Performance Management

M.D.Suranjana 59
 Human resources planning
“HR planning is the process of estimating future requirements for
employees, analyzed according to the work or jobs they will do and
their level or position in the organization structure: these estimates
should specify the expected numbers of each type of employee”
(a) The forecast should cover a planning period of several years,
although the plan for the short term, possibly the next 12 months,
will be more detailed that the forecasts for the longer term due to
greater uncertainty about the long-term future.
(b) The HR plan should also estimate the available numbers of
employees of each type, allowing for losses through resignations
and retirement.
(c) There will be a gap between forecast requirements and forecast
staff available, and the HR plan should include provisions for closing
the gap.

M.D.Suranjana 60
The process is illustrated in the following diagram.

Forecast availability of
Forecast requirements
employees, allowing
for employees
for losses.

Difference = gap
For most jobs there will
be a shortfall of available
employees.
Occasionally there may
be a surplus of some
types of employee.

Plan to fill gaps with

promotions and transfers.
Estimate numbers of
promotions and transfers.

These will create gaps in

other areas. Some gaps
will remain.

Plan recruitment numbers

to fill the gaps.

M.D.Suranjana 61
The recruitment and selection process
• Recruitment starts when a job vacancy is
identified. It is the process of obtaining a
supply of suitable possible candidates to fill
the vacancy.

• Selection is the process of appointing the

most suitable candidate to a job vacancy, by
choosing the best individual from the
candidates available.

M.D.Suranjana 62
Recruitment

Vacancy or vacancies identified

Identify skills and personal qualities

needed for the job

Obtain applicants for the job

Selection

Select candidates for interview

Selection interviews

Prepare a short-list; offer the job

to the person at the top of the list

M.D.Suranjana 63
 Internal promotion advantages
• Internal promotion can improve the morale and motivation of
the workforce.
• Internal recruitment provides a career development
opportunity to existing employees. Career development helps
with talent retention
• Making internal appointments may be less risky than external
appointments since employer already know about them
• The employees may already know the people they will be
working with, if they are successful in getting the job.
• Inexpensive & quick - there is not requirement to advertise

M.D.Suranjana 64
External recruitments advantages

• The organization may not have employees with the

skills required for the job.
• External recruitment may introduce 'fresh thinking'
and new ideas into the organization
• There may not be an existing employee who is the
right person for the job. There may be more
vacancies than there are candidates to fill them by
internal promotion
• The vacancies may be for junior jobs that existing
employees do not want to apply for.

M.D.Suranjana 65
Method of advertising vacancies

External recruitment
I. Recruitment agencies- External recruitment agencies may
specialize in finding applicants for particular types of job.
Some recruitment agencies ('head hunters') specialize in finding
suitable external applicants for senior management positions.
2. Media advertising- An organization (or a recruitment agency)
may advertise job vacancies in the media, particularly newspapers
or journals
3. The internet- Many organizations advertise job vacancies – both
internally and externally – on their own website.

M.D.Suranjana 66
 Internal recruitment

Performance Performance appraisal systems may be used to identify candidates for

appraisal promotion, and they may be invited to apply for a job vacancy.

In-house If an organization publishes an in-house journal, it may use this to

magazine advertise job vacancies.

Internet/intranet An organization may advertise vacancies on its website or on an in-

house bulletin board.

M.D.Suranjana 67
 Selection methods
• Application forms or online tests. These are used as a first
screening process, to reduce the number of applicants for interview to a
manageable number

• Interviews- A selection interview is a face-to-face interview at which the

applicant is asked a number of questions, and is assessed by the quality of their
answers.

• Tests- Intelligence, Aptitude, Competence & Personality tests

• Group selection methods- a number of people from the
organization observe a number of applicants for a job as they go through a series of
specially-designed activities. Observing candidates in a role play situation provides
insights into various skills of the different individuals, such as:
-Verbal skills -Leadership behavior -Ability to mediate successfully in disputes

M.D.Suranjana 68
 Induction
Induction is a process of getting a new employee to become more
familiar with the organization, and to 'feel at home’
Stages in a induction process
I)Before joining the organization- Employers use the selection
process, to inform the individual about the organization and what
will be expected from them & organization employs the 'right type'
of person, who seems likely to fit in well.
2) On first joining- When the employee's expectations differ from
reality, a socialization process is needed to make the individual
familiar with the organization’s standards, methods and culture
3) Familiarization- After the employee has joined the organization,
the socialization process should begin.

M.D.Suranjana 69
 Employee motivation
• Motivation is 'a decision-making process
through which the individual chooses desired
outcomes and sets in motion the behavior
appropriate to acquiring them’
Theories of motivation
i)Content theories- These theories ask the question: 'What are the things
that motivate people? Content theories suggest that the best way to motivate an
employee is to find out what their needs are and offer them rewards that will satisfy
those needs. E.g: Maslow’s Hierarchy of needs theory, Herzberg’s two-factor theory
ii) Process theories- These theories ask the question: 'How can people
be motivated?. They explore the process through which outcomes become desirable
and are individuals are motivated to pursue them. E.g: Expectancy theory equity theory

M.D.Suranjana 70
Maslow's hierarchy of needs

M.D.Suranjana 71
 Herzberg's two-factor theory

Need Motivating Comment

factors
To avoid Hygiene These relate to conditions at work, such as working conditions, job
unpleasantness factors security, inter-personal relations at work, supervision, company
policies and pay.
Hygiene factors cause dissatisfaction in the individual if the
individual's needs are not met. They do not motivate the individual to
perform better.
For personal Motivator These satisfy the need for fulfillment at work, and include factors
growth and factors such as challenging work, career advancement (or the prospects of it),
fulfillment a sense of
Achievement, recognition from bosses and colleagues, responsibility,
and pay.

M.D.Suranjana 72
 Vroom's expectancy theory

• Expectancy theory states that the strength of an individual's

motivation to do something will depend on the extent to which
they expect the results of their efforts to contribute to their
personal needs or goals.
• F=V×E
F = the force or strength of the individual's motivation to behave in
a particular way
V = valence: the strength of the individual preference for a given
outcome or reward and
E = expectancy: the individual's perception that the behavior will
result in the outcome/reward.

M.D.Suranjana 73
 Equity theory

➢ Adams argued that employees seek to maintain equity

(fairness) in the relationship between:
• The inputs they bring to their job and the outputs they receive
from doing the job
• The perceived inputs that work colleagues put into their job and
the outputs that they receive
➢ He argued that people at work value fair treatment, and they
are:
• Motivated to maintain fairness
• De-motivated if they believe that there is a lack of fairness

M.D.Suranjana 74
 Equity theory …..

➢ Adams suggested that equity (fairness) is perceived to exist when an employee

believes that:
Ratio of Individual's outcomes = Ratio of outcome of work colleagues
Individual's inputs Inputs of work colleagues
➢ Inputs typically include:
• Time put into the job • Effort put into the job • Loyalty • Hard work
• Ability and skill • Enthusiasm • Drive and ambition

➢ Outputs typically include:

• Monetary compensation/remuneration • Other non-monetary benefits
• Flexible working arrangements • Recognition • Responsibility
• Praise and thanks

M.D.Suranjana 75
 Job design as a motivator
Job design refers to how tasks are organized to
create 'jobs' for individuals
Job Making the job more challenging and more fulfilling. Herzberg
enrichment suggested that this would provide motivation for individuals.

Job Adding more responsibilities to the job. However, adding more tasks
enlargeme that do not provide a challenge will not be sufficient to motivate
nt individuals to perform better.
Job Moving individuals from one job to another within the organization
rotation or department. Job rotation can reduce the monotony of performing
non-challenging work, but will not provide motivation.

M.D.Suranjana 76
 Pay and reward systems as
motivators
How is pay determined?
Job evaluation This is a systematic process for establishing the relative worth of jobs within an
organization. Its main purpose is to provide a rational basis for the design and
maintenance of a fair pay structure. Rates of pay for the job are decided according to
how the job is evaluated.
The pay structure is based on job content, and not on the personal merit of the
jobholder.
Fairness Pay must be perceived and felt to match the level of work, and the capacity of the
individual to do it.
Negotiated pay Pay scales, differentials and minimum rates may be negotiated at plant, local or
scales national level between employer(s) and representatives of employees.
Pay scales may include annual increments, to reward individuals for their additional
experience.
Market rates For some jobs there may be a 'market rate' that most employers pay.
Individual Individuals may be paid rewards for good performance, in addition to their basic pay.
performance in the
job

M.D.Suranjana 77
 Remuneration structure

Element of remuneration Comment

Basic pay or salary
Overtime payments Paid for working hours in addition to their normal hours of work.

Pension An employer may have a pension scheme for some of its employees. The pension will
become payable when the employee (or former employee) reaches 'retirement age'.
Benefits in kind An example is the use of a company car. Senior managers may expect certain benefits in
kind in recognition of their status in the organization.
Annual bonuses linked to Annual bonuses are usually paid in cash.
the achievement of They are sometimes paid in the form of a grant of new company shares.
Performance targets

Longer term For senior managers and perhaps also key employees, a company may give longer-term
incentives incentives in the form of the grant of new company shares or share options. Share options
give the holder the right on or after a future date to buy new shares in the company at a
fixed exercise price.
Long-term incentives cannot usually be exercised for at least three years after they have
been awarded.

M.D.Suranjana 78
 Rewarding the team
• Group bonus schemes
• Group incentive schemes typically offer a bonus for a team that
achieves or exceeds specified targets.
• This is appropriate for tasks where individual contributions
cannot be isolated
• Group bonuses may enhance team-spirit and co-operation as
well as provide performance incentives.
Profit-sharing schemes
• Profit-sharing schemes offer employees (or selected groups)
bonuses that are directly related to profits or value added.
• Each employee entitled to a bonus is then paid a share of the
total bonus, probably a percentage of their basic salary.

M.D.Suranjana 79
 Performance management
“It is a process to establish a shared understanding
about what is to be achieved, and an approach to
managing and developing people in order to
achieve it”
• Performance appraisal is part of the system of
performance management, including goal setting,
performance monitoring, feedback and
improvement planning.
• Performance management aims to get better
results for the organization via the measurement
and evaluation of individual performance.

M.D.Suranjana 80
 Main components of performance
appraisal

• Reward review - Measuring the extent to which an employee is

deserving of performance-related bonuses or pay increases.
• Performance review -for planning and following-up training and
development programmes, identifying training needs, validating
training methods and so on.
• Potential review - as an aid to planning career development and
succession, by attempting to predict the level and type of work the
individual will be capable of in the future.

M.D.Suranjana 81
 Appraisal techniques
• Overall appraisal- The manager writes in narrative form their
judgments about the employee. There is no guaranteed consistency of
the criteria and areas of assessment
• Guided assessment -comment on a number of specified characteristics
and aspects of the employee's performance elements
• Grading- Managers are asked to select one of a number of grades
(levels or degrees of performance) that the individual has achieved in
each of a number of different aspects of performance
• Behavioral incident methods- These assessments concentrate on
employee behavior. Behavior of the individual is compared with typical
behavior in each job, as defined by common critical incidents of
successful and unsuccessful job behavior reported by managers
• Results-oriented schemes - These review performance against specific
targets and standards of performance

M.D.Suranjana 82
 Performance is judged by
achievement of predetermined
objectives (MBO)
• compare an individual's actual achievements with
predetermined performance targets
• This is applicable to individuals in management
positions who can be given targets for achievement.
• it is necessary to have objective performance targets
that can be measured in quantifiable terms, and
where actual performance can be measured in the
same way.
• When targets are qualitative rather than quantitative,
it becomes relatively easy to interpret actual
performance in a judgmental and possibly prejudiced
way.

M.D.Suranjana 83
 Graphical rating scales
• Employees are assessed on the basis of work
factors or work behavior. For each aspect of
work performance or behavior, there is a rating
scale, and individuals are awarded a score up to
the maximum amount.
• The individual's total score is the sum of the
scores for each factor, and performance is
regarded as outstanding, good or sub-standard
on the basis of the individual's total score.

M.D.Suranjana 84
 behaviorally anchored rating scales
(BARS)
• It is a method of appraisal that combines graphical rating scales with critical
work incidents and, in some cases, quantified performance measurements.
• A feature of BARS is that the factors to which rating scales are applied are
unique to the individual job, and are not generic factors applied to all jobs.
• For each job, aspects of the work are analyzed into performance dimensions.
Examples of effective and ineffective work performance for each of these
performance dimensions are collected (provided by individuals with a detailed
knowledge of the job). Individuals are given a rating score according to their
performance in each of the dimensions (taking critical incidents into
consideration too) and are then awarded an overall rating for performance in
the job.
• Constructing a procedure for performance measurement using BARS is time
consuming, and also requires input from individuals with an in-depth
knowledge of individual jobs.

M.D.Suranjana 85
 360 degree appraisal

A 360 degree appraisal is an appraisal of an individual from a variety

of different sources:
(a) The individual's immediate manager
(b) People who report to the individual
(c) Peers and co-workers: most people interact with others within
an organization, either as members of a team or as the receivers or
providers of services – they can offer useful feedback on
performance
(d) Customers: if sales people know what customers thought of
them, they might be able to improve their methods of working
(e) The individual personally: all forms of 360 degree appraisal
require people to rate themselves

M.D.Suranjana 86
 Methods of training and development
• Job-related Training- cover a wide range of work-related topics
• Cross-functional Training- in-house training programmes where individuals
learn more about the work done in other departments
• Leadership Training-There are courses in leadership skills, to help individuals
to develop into future leaders of the organization (e.g.: MBA)
• On-the-Job Training-training an individual to do a job by showing them how to
do it in the real working environment.
• Apprenticeship-employ young individuals as apprentices, and provide them
with training to acquire particular skills.
• Development Planning- Development planning between an individual and their
manager may be a part of the formal performance management and appraisal
process.
• Formal Coaching -Just as top sports people may have a personal coach, selected
managers in a company may be given a senior manager as a personal coach, to
help with their development towards a top position in the company.
• High visibility Assignments-Young talented managers may be assigned to
projects where they will meet with top management
• Job rotation-This involves moving individuals regularly between jobs in the
organization, possibly within the same department

M.D.Suranjana 87
Training and development, and return
on investment
• ROI in HR management can be defined as the
benefits obtained from an HR activity,
converted into a money-equivalent value,
expressed as a percentage of the cost of the
activity.
• When measuring ROI for training Programmes
(or other HR initiatives), the investment is the
cost of the initiative
• ROI=Benefits/Cost

M.D.Suranjana 88
 Knowledge management
• Knowledge management involves the identification,
collection and use of knowledge for the purpose of
creating value for the organization.
• Data are simple facts. Information is processed and
organized data. Knowledge comes from a
combination of: Analyzing information & Experience
and training
• Knowledge are two parts
1.Explicit Knowledge-Knowledge that is recorded in
documents or files, and available to everyone
2.Tacit Knowledge-Information that is not recorded, but
is in people's heads
M.D.Suranjana 89
 Knowledge management (KM)
systems
i) Expert System- An expert system is a
computer program that captures human
expertise in a specific area of knowledge.
ii) Data mining- Data mining software discovers
previously unknown relationships and
provides insights that cannot be obtained
through ordinary summary reports.

M.D.Suranjana 90
 Change and change management
• Business organizations operate in a rapidly-changing
environment and marketplace. To remain successful, they
must adapt by responding to the changes and taking
advantages of any strategic opportunities that may arise.
• when major changes are required, there will often by strong
resistance from employees and the existing culture of the
organization.
• Lewis identify 3 steps model for change
1. Unfreeze-process of finding a way to get people to end their
resistance to change. This is achieved by finding ways to
strengthen the driving forces for change or to weaken the
restraining forces that resist change (or a combination of the
two).
2. Movement-making the change. It includes not just making
the changes to operations and activities, but making changes
to the thoughts, feelings and behavior of the people affected
3. Refreeze- establishing theM.D.Suranjana
change as a new mind set. 91
 Leadership
• Leadership is 'the activity of influencing people to
strive willingly for group objectives.
• There are 4 key leadership skills
1. Entrepreneurship-ability to spot business
opportunities and mobilize resources to exploit
them. Interpersonal
2. Interpersonal skills-E.g: Networking
3. Decision-making and problem-solving skills- But
with an ability to 'see the big picture' strategically.
4. Self-development skills-ability to learn continuously
from experience, to grow in self-awareness and to
exploit learning opportunities.
M.D.Suranjana 92
 Trait theories of leadership
• This states that the best leaders have certain
characteristics or qualities – traits.
• Trait theories are therefore based on analyzing the
personality characteristics or preferences of
successful leaders
• According to this-leaders are born, not made‘
• Traits examples-Judgment • Initiative • Integrity •
Foresight • Drive • Human relations skill •
Decisiveness Dependability • Fairness • Ambition
• Dedication • Objectivity • Energy • Emotional
stability • Co-operation
M.D.Suranjana 93
 Style theories (behavioral theories) of
leadership
• These state that the most effective leaders are those
who have the right leadership style for the situation.
• models of leadership style usually describe a range of
continuum of behaviors between:
➢ Exclusive focus on the task in hand (at one extreme)
➢ Exclusive focus on the people working for the leader
(at the other extreme)
• Examples of leadership style models are:
E.g: Transformational leadership-Transformational
leaders are the leaders who are capable of seeing a
need for strategic change, and leading the organization
through the change M.D.Suranjana 94
 Transformational leadership
4 is of transformational leaders
• Idealized influence (II) -The leader acts as an 'ideal'
role model for others to follow.
• Inspirational motivation (IM)-The leader can inspire
and motivate followers
• Individualized consideration (IC)- The leader shows
real concern for the needs and feelings of followers.
This personal attention to each follower is a key
element in the leader's ability to bring out their very
best efforts.
• Intellectual stimulation (IS) -The leader challenges
followers to be creative and innovative, and to achieve
higher levels of performance.
M.D.Suranjana 95
 Situational approaches to leadership
• This propose that the most effective approach to
leadership depends on the work situation.
- Tasks requirements
- Superiors
- Subordinates
- Peers
-Organisational Culture

M.D.Suranjana 96
 Drucker’s MBO
• Drucker's model focuses on the achievement of output
objectives where the performance of individuals is
assessed by looking at the degree to which they meet
their targets
• Drucker argues that the nature of the business
organisation requires multiple objectives to cover
every area where performance and results affect the
business, and that it is essential for the organisation to
ensure a balance between the short and long term.
E.g.: Profitability, Innovation, Market standing,
Productivity, Financial & physical resources, Managerial
performance & development, Worker performance &
attitude, public responsibility
M.D.Suranjana 97
9.Technology and Innovation
Management

M.D.Suranjana 98
 Impact of technology on the value
chain
Value chain activity Examples of technology adding value
Inbound logistics Material requirements planning (MRP), Enterprise
resource planning (ERP) and just-in-time purchasing.
Operations Technology can be used to automate and improve tasks;
e.g.: Robots, process control, and machine tool control,
CAM(Computer-Aided Manufacturing),CIM,ERP
Outbound logistics Warehouse management systems (WMS), RFID
Marketing and Sales EPOS systems ,The use of technology for customer
relationship management, use of the internet for online
marketing and selling.
Service Customer databases allow organizations to sell aftersales
services and to deal with customer complaints & queries.
Procurement IT can automate purchasing decisions and can be used as a
link to a supplier with EDI
Human Resource IT applications include the maintenance of a skills
Management database and staff planning.
M.D.Suranjana 99
 Innovation diffusion model
• The theory of diffusion of innovations is concerned with the way
in which new ideas and innovations are spread and adopted by
users.
• Diffusion can be defined as 'the process by which an innovation
is communicated through certain channels over time among
members of a social system‘
• Rogers argued that there are four factors that influence the
diffusion of an innovation:
➢ The nature of the innovation itself
➢ The channels of communication that are used to spread
information about (and knowledge of the innovation within the
social system
➢ The time for the innovation to spread through the social system
➢ The social system: the group of individuals who share a
common 'culture' and are potential adopters of the innovation
M.D.Suranjana 100
 Five stages in the acceptance of an
innovation.
Stage of Comment
adoption
1 Awareness Individuals are exposed to the innovation, but do
not have complete information about it.
2 Interest Individuals become interested in the innovation and
seek more information about it.
3 Evaluation Individuals think about the innovation and apply it
to their own personal circumstances. Evaluation
leads on to a decision to try the innovation.
4 Trial Individuals make full use of the innovation, to test
it.
5 Adoption Individuals are satisfied with the innovation and
decide to continue to use it.
M.D.Suranjana 101
 Research and Development
There are three
1. Pure 2.Applied 3. Development
• It can be product or process research
- Product research is based on creating new
products and developing existing ones.
- Process research is based on improving the
way, or efficiency with which, those products or
services are made or delivered.
M.D.Suranjana 102
Stages in the process of new product
development
1) Idea Generation- e.g.: Customers, Managers,
employees, Internet are examples for sources of
new ideas.
2) Idea screening- New product ideas are given an
initial 'screening', to decide whether the idea
may be a good one.
3) Concept Development and testing- The product
concept is developed in more detail, and this
concept is tested on a small group of prospective
customers, to see how they react to it
M.D.Suranjana 103
4) Business analysis- Carry out a financial analysis
of the potential returns from the product.
e.g.: Estimate sales volume, revenue, Profitability,
break-even point
5) Beta testing and market testing- Produce a
physical prototype (early model) of the product.
Arrange private testing with a test group of
customers ('beta testing'). Make adjustments to
the product design based on customer feedback.
Produce a small quantity of the amended product
to test by selling in a small market area ('test
marketing').
M.D.Suranjana 104
6) Technical implementation -Plan and establish
the arrangements for production and logistical
arrangements for distribution of the product.
7) Launch the product on the market- The
market launch is likely to be supported by an
intense selling and marketing campaign.
8) Post-launch review- Carry out a review of the
product after the market launch.
Review the selling price and adjust this if an
increase or reduction in price seems
appropriate.
M.D.Suranjana 105
 Cloud and mobile technology
• Cloud computing is a general term for anything
that involves delivering hosted services over the
Internet. It involves both storing data and
processing data.
• A cloud service has three distinct characteristics
that differentiate it from traditional web hosting:
1. It is sold on demand, typically by the minute or
the hour;
2. It is elastic — a user can have as much or as little
of a service as they want at any given time; and
3. The service is fully managed by the provider (the
consumer needs nothing but a personal computer
and Internet access).
M.D.Suranjana 106
 Cloud computing deployment models
• Private cloud services are delivered from a business's
data Centre to internal users.
• public cloud model- a third-party cloud service provider
delivers the cloud service over the internet. Public cloud
services are sold on demand, typically by the minute or
hour, though long-term commitments are available for
many services
• A hybrid cloud- is a combination of public cloud services
and an on-premises private cloud, with orchestration and
automation between the two. Companies can run mission-
critical workloads or sensitive applications on the private
cloud and use the public cloud to handle workload bursts
or spikes in demand.
M.D.Suranjana 107
Cloud computing deployment
models…..

M.D.Suranjana 108
 Cloud service categories
• Infrastructure as a Service (IaaS)-IaaS providers supply a
virtual server instance and storage, as well as
application program interfaces that enable users to
migrate workloads to a virtual machine. (A virtual
machine is a self-contained operating environment that
behaves as if it is a separate computer.)
• Platform as a service (PaaS)- )- cloud providers host
development tools on their infrastructures and users
access these tools over the internet. PaaS is used for
general software development, and many PaaS
providers host the software after it's developed.
• Software as a service (SaaS)- SaaS is a distribution
model that delivers software applications over the
internet; these applications are often called web
services.
M.D.Suranjana 109
Cloud service categories…

M.D.Suranjana 110
 Big Data
• 'Big data' is a popular term used to describe the
exponential growth and availability of data, both
structured and unstructured.
• Organisations today have more transactional data
than they have ever had before – about their
customers, suppliers and about their operations.
• Consumers using social media, smartphones,
laptops and tablets to browse the internet, to
search for items, to make purchases and to share
information with other users also all create trails of
data. Similarly, internet search indexes (such as
Google Trends) can be sources of data for Big Data
analytics.
M.D.Suranjana 111
 Big Data…..
• Big data is a term for a collection of data
which is so large that it becomes difficult to
store and process using traditional databases
and data processing applications
• Big data often also include more than simply
financial information and can involve other
organisational data (both internal & external)
which is often unstructured

M.D.Suranjana 112
 Big data-examples
• Social network traffic
• Web server logs
• Traffic flow information
• Satellite imagery
• Streamed audio content
• Banking transactions
• Web page histories & content
• Government documentation
• GPS tracking
• Telemetry from vehicles
• Financial market data

M.D.Suranjana 113
 Three Vs of big data
• Volume – The vast volume of data generated is a
key feature of big data. The main benefit of big
data analytics comes from the ability to process
very large amounts of information.
• Velocity – This refers to the speed at which 'real
time' data is being streamed into the
organisation, and with which it is processed
within the organisation.
• Variety (or variability) – A common theme in
relation to big data is the diversity of source data,
with a lot of the data being unstructured (i.e. not
in a database).
M.D.Suranjana 114
 the fourth V of big data
• Veracity (truthfulness) -data to be beneficial
for decision making it needs to be reliable and
truthful.
• hidden biases in the data could present
significant risks to an organisation.
• Poor data quality can often be the main
barrier to executives integrating more data
and analytics into their decision making.

M.D.Suranjana 115
 Big data analytics
• Big data analytics refers to the ability to
analyze and reveal insights in data which had
previously been too difficult or costly to
analyze, due to the volume and variability of
the data involved.
• In the past it has sometimes been referred to
as 'data mining’.

M.D.Suranjana 116
 Value of big data
• 1. Transparency- Making data more easily
accessible to relevant stakeholders, in a timely
manner, can create value in its own right – for
example, by revealing insights from data which
had previously been too costly or complex to
process. This transparency could relate to data
within an organisation as well as external data
• 2. Performance improvement- The increasing
amount of transactional data they store in digital
form provides organisations with an increasing
amount of accurate and detailed performance
data – in real or almost real time
M.D.Suranjana 117
 Value of big data..
• 3. Market segmentation & Customization-The
volume and variety within big data enables
organisations to create highly specific segments
within its markets and to tailor its products and
services precisely to meet the needs of customers
in those segments.
• 4. Decision making- The sophisticated analytics
tools which are used to uncover previously
hidden patterns and trends in data could also be
used to improve decision making. E.g.: Determine
inventory & pricing strategies.
M.D.Suranjana 118
 Value of big data..
• 5. New products & services- Companies can
use data about social trends and consumer
behaviors to create new products and
services to meet customer's needs, or to
enhance existing products and services so that
they meet customers' needs more exactly.

M.D.Suranjana 119
 Artificial Intelligence
• AI is an area of computer science that emphasizes
the creation of intelligent machines that work &
react like human beings. Some of the activities
that computers with artificial intelligence are
designed for include:
* Voice recognition
* Planning
* Learning
* Problem solving
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 Machine Learning
• Machine Learning is a sub-area of artificial
intelligence, whereby the term refers to the
ability of IT systems to independently find
solutions to problems by recognizing
patterns in databases. In other words:
Machine Learning enables IT systems to
recognize patterns on the basis of existing
algorithms and data sets and to develop
adequate solution concepts. Therefore, in
Machine Learning, artificial knowledge is
generated on the basis of experience.

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 Social media marketing

• Social media marketing involves

interacting and communicating with
the userbase to develop and retain
relationships which can be used to gain
'buy in' from the potential consumer.

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 Viral marketing

• Viral marketing is delivering a message or idea that

acts like a virus via social media platforms such as
YouTube, Twitter and Instagram, spreading through
the online community as users forward messages
within own networks, who then forward again, and so
on, driven by content that has an immediate emotional
impact, ie the message contains humour, is sad or
romantic or has shock value.
• Viral marketing is difficult to plan or predict as it is
unclear whether a new message, image or video will
create the urge to forward online.

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 Data mining

• Data mining is the process of extracting

usable data from a larger set of any raw data
by harvesting, collecting or 'mining' data
from across all digital platforms,
representative of 'big data', in order to
perform complex data analytics techniques.

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 Data Analytics

• Data analytics involves utilising raw data

gained through data mining to create a
knowledge bank of new and useful
information. This information can then be
analysed to gain insights into a customer or
potential customer's behaviour, including likes,
dislikes and other emotional triggers or make
links between customer profiles and buying
habits, which will help companies to identify
trends or target particular social groups with
products and services which are likely to have
appeal.
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 What is social media marketing?

• Social media marketing refers to the process of acquiring

customers and attracting the attention of potential customers
through social media sites.
• Social media marketing is about reaching the right audience,
with the right message at the right time, so that is causes
resonance. i.e. it creates awareness, or new product demand,
or creates an urge to share the message due to the contents
emotional impact.

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 Key Risk Indicators (KRIs)
Key Risk Indicators (KRIs) are critical
predictors of unfavorable events that can
adversely impact organizations. They
monitor changes in the levels of risk
exposure and contribute to the early
warning signs that enable organizations to
report risks, prevent crises and mitigate
them in time.

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 KRIs examples
• Number of customer complaints
• Staff turnover
• Staff absenteeism
• External frauds
• Internal frauds
• Financial ratios

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