(dbus 31) - anucde · (dbus 31) m.b.a. degree examination, ... critically examine the capital...

(DBUS 31)

M.B.A. DEGREE EXAMINATION, DECEMBER 2011.

Final Year

A-Financial Management

Paper I — SECURITY ANALYSIS AND PORTFOLIO MANAGEMENT

Time : Three hours Maximum : 75 marks

SECTION A — (3 5 = 15 marks)

Answer any THREE of the following.

1. (a) Investment risk

(b) YTM

(c) Rolling settlement

(d) Optimum portfolio

(e) Economic analysis

(f) EMH.

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SECTION B — (3 15 = 45 marks)


2. Explain the growth of mutual trends in India.

3. State the factors that may be considered while selecting a portfolio.

4. How do you value bonds?

5. Enumerate the regulations relating to stock exchanges.

6. Critically examine the capital market theory.

7. Distinguish between technical analysis and fundamental analysis.

SECTION C — (15 marks) (Compulsory)

8. The following are the returns on same stock and the BSE Index for the last five years.

Year Return on security

Return on BSE National Index

(%) (%) 1 5 15 2 8 20 3 8 25 4 9 20 5 10 30

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Required :

(a) Calculate the security's Alpha (A) and Beta (B).

(b) Show the proportions of security's variance explained and not explained by the Index.

(c) Suppose the level of index for the coming period is estimated at 38%, what will be the expected return on the security?

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Final Year

(A-Financial Management)

Paper II — MANAGEMENT OF FINANCIAL SERVICES




1. (a) Seed capital.

(b) Financial service.

(c) Money market.

(d) Rolling settlement.

(e) Portfolio manager.

(f) Hire purchase agreement.

SECTION B — (3 × 15 = 45 marks)


2. Describe the structure of India Financial system.

3. How do you manage risk in financial services?

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4. Describe the growth of mutual funds in India.

5. Explain the role of merchant banking in issue management.

6. Describe the nature and objects of credit rating.

7. What are the advantages of factoring?

SECTION C — (15 marks)

8. XYZ is in the business of manufacturing steel utensils. The firm is planning to diversity and add a new product line: The firm either can buy the required machinery or get it on lease.

The machine can be purchase for Ra. 15,00,000. It is expected to have a useful life of 5 years with salvage value of Rs. 1,00,000 after the expiry if 5 years. The purchase can be financed by 20 percent loan repayable in 5 equal annual installments (Inclusive of interest) becoming due at the end of each year. Alternatively, the machine can be taken on year end lease rentals of Rs. 4,50,000 for 5 years. Advise the company, which option it should choose. For your exercise, you may assume the following :

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(a) The machine will constitute a separate block for depreciation Purposes. The company follows written down value method of depreciation, the rate of depreciation being 25 percent.

(b) Tax rate is 35 percent and cost of capital is 18 percent.

(c) Lease rents are to be paid at the end of the year.

(d) Maintenance expenses estimated at Rs. 30,000 per year are to be borne by the lessee.

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Final Year

A-Financial Management

Paper III — PROJECT MANAGEMENT




1. (a) Time budget

(b) Cost overruns

(c) Delphi technique

(d) Project idea

(e) NPV

(f) Project costing

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2. How is technical analysis organised?

3. Explain the steps in the formulation of project report.

4. What are the uses of PERT in project management?

5. Discuss the quality of human resources required for project planning.

6. Describe the techniques employed in the financial appraisal of projects.

7. Elucidate the management of transition from project to operations.


8. Given the following : Activity Immediate predecessor Duration in days

A — 9 B — 20 C — 10 D A 11 E C 10

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Activity Immediate predecessor Duration in days F B, C 4 G F 2 H D, F 5 I E, F, K 18 J G, H 14 K — 24 L K 6

(a) Draw the CPM diagram.

(b) Find out the critical activities.

(c) Compute the total, free and independent flats for activities E, D, G, H and L.

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Final Year

(B-Marketing Management)

Paper I — SALES AND ADVERTISING MANAGEMENT




1. (a) Selling skills.

(b) Sources of recruiting salesmen.

(c) Sales territory.

(d) Message design.

(e) Marketing communication.

(f) Personal selling



2. Discuss the interdependence between sales and distribution management.

3. How are salesmen selected?

4. Explain the steps involved in the preparation of sales budget.

5. How do you measure the effectiveness of advertising?

6. What are the functions rendered by advertising agency?

7. State the factors that may be considered while designing compensation plan for salesmen.


(Compulsory)

8. Land Escape Vacation Club sells fractional interests in time-share vacation properties at various beach locations. For example, an owner will purchase an interest of four weeks a year at a Land Escape property in a place like Hilton Head, South Carolina. Prospective buyers, are offered a free weekend stay at a land Escape resort if they listen to a sales presentation while they are there.

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Sales at the La Jolla, California, location have been inconsistent over past two years and the

past two years and the sales manager. Denise London has been asked by Land Escape’s vice

president of sales to review the profiles of her three sales people in order to come up with a

plan to improve sales.

Catalina is a woman in her 30s with a husband and two small children at home. She was

once a television weather forecaster (she would say “meteorologist”) but got fired and was forced to do something else. She thought that working in sales would be for the short term

until another television opportunity came about, but she has now been in Land Escape sales

for about three years. Trying to make the best of a bad situation, she was very enthusias

when she first began selling but her enthusiasm and energy level have been waning as she

has realized that she will probably continue doing sales for the long term. She and her

husband feel some financial pressure because of their decision to put their children in private school, which is very costly. The economy has been difficult and Catalina is beginning to

believe she cannot succeed no matter what she does.

She is somewhat insecure and sensitive but conscientious and a team player. She likes

people and seeks personal relationships with customers and takes a long-term approach. Her philosophy is “if potential customers don’t want to buy right away, I don’t pressure them. I

will keep in contact with them and eventually they will come back and buy” Denise does not

care for Catalina’s style and tends to let her operate without Supervision, because, frankly,

she doesn’t know what to tell her to do better.

Zach is 25 years old, just two years out of college. He has been with Land Escape for

approximately eight months now. He is a perfectionist and highly competitive. Before be came to Land Escape, he had no previous sales experience, but he does have a natural

selling skill. He is a little bit of a loose cannon and is not afraid to bend or even break the

rules. Needless to say, he is not the least hit self-conscious. Some find him friendly and like

his engaging style; however, some are turned off by it and see him as a stereotypical ‘‘slick’’

sales person.

His goal is make as much money as possible in a short amount of time. He will decide later

whether he wants to stay in sales for the long term; right now he just wants to be young and

have fun. He is favored by the sales manager, Denise, who Sees him as a potential star

because of his early success. As a result, she gives him closer supervision and guidance.

John is the dean of the group at age 53. He has been in Land Escape sales since its inception

12 years ago and was in sales for 10 years before that time. He is good at what he does. He says, “I’ve pretty much mastered the art of time-share selling, and I’m cruising along. I know

exactly how much effort to make to get the sale, so why should I do any more than that?”

His art-collecting hobby now interests him more than selling, and he has no desire to be

promoted to sales manager or move to a different location. John is some what resentful that

he has a female manager who has a female manager who has less experience than he does

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and has made it known that he needs no supervision from her. He does well enough that

Denise complies and just lets him sell without a close watch.

Denise knows she needs to make some changes but is not sure what to do. She feels the

current compensation plan of 70 percent commission and 30 percent salary is fairly generous

and she even runs the occasional sales contest to boost numbers during the slowest months.

She had better think of something quickly before the VP gives her a “permanent vocation”.

Questions :

(a) In what career stage would you place each of the three salespeople?

(b) If you were the sales manager, how would you motivate each salesperson? Explain your

recommendations.

(c) What measures might you to motivate them as a group?

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(DBUS 35)


Final Year

B-Marketing Management

Paper II — MARKETING OF SERVICES




1. (a) Service triangle.

(b) Marketing of professional services.

(c) Consumer banking.

(d) Features of services.

(e) Service blue printing.

(f) Ind mark



2. ‘HRM is the key for the success of hospitality services’. Comment.

3. Discuss the application of marketing concept in public utilities.

4. Bring out the experiences of City Bank in the marketing of its services.

5. Describe the factors that govern the demand and supply of tourism.

6. Enumerate the strategy followed while marketing family planning.

7. Give an account of marketing of health services by Appollo Hospitals.

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(Compulsory)

8. Case Study :

Analyse the following case and answer the questions given at the end.

The Medical Department of Railways is headed by Director General Railway Health Services

(DGRHS). He is assisted at the Railway Board by Directors, Jt. Directors and Dy. Directors

and other staff. The Chief Medical Officers (CMO) of all zonal Railways and production units

report to him. The CMO is overall incharge of the Medical Department of the zonal railway.

CMO is assisted by Dr. CMO, Sr. Medical Officers and other staff at the zonal headquarters

level. The Chief Hospital Superintendent of Central Hospital of the railways and other

divisional hospitals report to him. The MS/Sr. DMO is overall in-charge at the level of

division.

There are 572 health units and 105 hospitals (9 zonal, 55 divisional and 41 sub-divisional) on

Indian Railways. There are a total of about 11,500, beds in the different hospitals. The

hospitals have about 2,300 medical doctors, and there are about 56,550 para medical staff to

assist them. About 1.56 lakh patients attend the OPD every day. The set up of medical

department is given below (from the smallest unit onwards) :

1. Health Centre: This is the smallest unit and it covers the jurisdiction of about 100 km. It

caters to about 200 employees (say 1000 beneficiaries) and has one doctor.

2. Health Unit: It caters to about 600 employees (3,000 beneficiaries) and has two or three

doctors.

3. Poly Clinic: Health Unit which has a daily OPD attendance of 300 or more is converted

to Poly Clinic and has five doctors.

4. Sub-divisional hospitals: These provide specialist services and have a number of

departments. These also have a separate casualty service, which is manned round the

clock.

5. Divisional hospitals: These are the main hospitals of the railway division and are quite

big hospitals. Some of these hospitals are in fact as big as the zonal railway hospitals.

6. Zonal railway hospital: These are the apex hospitals of the zonal railway, and are the

main referral hospitals. They have facilities for super specialisations-Byculla Hospital

has specialised facility for plastic surgery; Varanasi Hospital for cancer, Perambur

Hospital for Heart.

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All the zonal railway hospitals have a similar structure, system, controls and procedures, and all of them work under identical set of rules. Central Hospital of Northern Railway is discussed in detail to give a general idea of these hospitals.

Questions :

(a) What are the positive and negative aspects of the above structure? Do you endorse the above structure of the medical organisation of Indian Railways?

(b) Do you suggest any changes in it? Substantiate your answer.

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(DBUS 36)


Final Year

(B-Marketing Management)

Paper III — RURAL MARKETING




1. (a) Concept of rural marketing.

(b) Rural consumer.

(c) Melas.

(d) E-choupal.

(e) Rural media.

(f) Rural distribution process.



2. What are the methods of pricing followed in rural marketing?

3. Discuss the steps in rural marketing research.

4. How do you design promotional misc for a rural marketing?

5. Give an account of the behavioural dimensions in the process of rural distribution.

6. Describe the services rendered by intermediaries in the rural marketing.

7. Describe the steps involved in the development of product for rural markets.


(Compulsory)

8. When Sri Krishna approached me for advice, I was unable to say anything with conviction and good evidence. He got an interview call letter for the position of sales manager from a reputed agrochemicals company in South India. The job involved working in rural areas to promote pesticides and related products Sri Krishna was in a dilemma for a good reason. He had neither science background nor rural exposure.

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Ureka!, while surfing the internet lazily, almost aimlessly, I had a surprise finding. It was the interview with Aruna Bhinge. In this interview, she talked to Sujatha Agrawal about the twists and turns on the road to success.

The excerpts from the interview are:

“I was always interested in science and wanted to do an MS-PhD programme in the United States. Instead, I got married, moved from Pune and decided to do an MSc and then a PhD in Mumbai. It took me nearly five years to get my masters in science (by research). Luckily, I was working with the Maharashtra Government’s Department of Science and Technology at the time. But the research experience was quite de-motivating.

I also discovered that I did not like staying in one place, a laboratory in this instance. I believe I am analytical, an independent thinker and good at getting things done. I also like to travel and talk to people. So I decided against a career in research. My husband suggested that I do a management course if I wanted a good corporate job. I was not confident about getting through the entrance test (it was almost 10 years since I had studied formally, though I was always a topper at school). He encouraged me by saying that if I did not pass only he and I would know about it. I did get into the Narsee Monjee Institute of Management Studies. I guess I was lucky, but it also shows what determination can do. I ended up topping my class in marketing. You don’t really have to study marketing; it is logic and common sense, though my analytical ability and household experience helped enormously.

ANZ Grindlays offered me a job in corporate banking after a campus interview, It was a good break, with a fantastic salary. But I was keen on marketing products and felt a bit sad that my years of scientific experience were being wasted. To me Grindlays was a golden cage. When I got an offer from Merind I was quite happy to move on though the money was not that good. Merind was a fantastic experience and for that I must give credit to Mr. Nawshir Khurody, the company’s then Managing Director. I was involved in setting up the diagnostics division and there was a tremendous amount of learning involved. I understood how to handle different business issues; dealing with suppliers, pricing, setting up a sales force, establishing a distribution network. In five years, we launched 25 products. I left the company only because its future seemed uncertain, since the Tata Group was not looking at pharma as a core business area

I also worked briefly with Lifescan, an American company that was launching diabetes monitors in India. But I wasn’t happy with their marketing strategy (they wanted to talk to doctors, not patients). And the scope of work was very small when compared with what I had done in Merind.

Fortunately, at that time Rallis was looking for a marketing person for agrochemicals. Though I did not know anything about the pesticides business, Mr. Vijay Rai convinced me about the job by saying that it was essentially a marketing function, of which I did have knowledge. Rallis has been an enriching experience. The marketing of pesticides involved visiting remote places, holding meetings with farmers, understanding their problems and psychology, creating marketing strategies to improve their knowledge level—it was an exciting period in my career.

I think farmers are wonderful people. They are receptive and they believe and trust you very easily. And they value and respect you. I had been dealing with doctors previously; it was so much more refreshing to talk to farmers. I believe that farmer contact is the key to success for Rails. The farmer wants you to, for instance, guide on the correct pesticide usage. Some of them cannot even recognize the diseases or pests harming their crops. They simply take the affected part of the plant to the dealer and he probably sells them a product that gives him, the dealer, the best returns.

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Earlier our people were very dealer-oriented, but we helped change their focus towards greater interaction with farmers. You need to go to their fields to really influence them. Our farms are not like -those in. America, where you will see fields that stretch beyond the horizon, but not a single farmer. In India you will see a farmer every acre or two. And they don’t mind spending half an hour talking to you. We would plan farmer-contact strategies in advance, and visit the fields before and during the crop season. I think the sales force appreciated this, and the farmers found it very useful.

It is important to design literature and material that educates farmers as well as promotes products. We designed flip charts which explained, simply and clearly, the diseases and pests, how to recognize and eliminate them. We also designed material which the sales person could carry as rolled-up charts on his back along with a stand. As he travelled through the villages he would stop wherever he saw farmers working in their fields and. hold meetings. It worked very well”.

Now based on this, can I advice Sri Krishna to attend the interview?

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(DBUS 37)


Final Year

C-Human Resource Management

Paper I — HUMAN RESOURCE PLANNING AND DEVELOPMENT




1. (a) Assumptions of HRD

(b) HRD in service industry

(c) Demand forecasting in HRD

(d) HRD and personnel management

(e) HRD Vs HRP

(f) Impact of LPG on HRD.

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2. State the strategic capabilities required for developing HR knowledge in driven organisations.

3. Explain the HR scenario at the macro level.

4. What are the techniques employed in forecasting the supply of HR?

5. State the strategies involved while designing HRD.

6. Compare HRD experiences between defence and Panchayat Raj Institutions.

7. Bring out the emerging trends in HRD.


8. Case Study :

The fast Growing Fastonal Company may be in a

league of its own when it comes to benefits. The

company’s business is about as low tech as you can

get : It sells nuts and bolts — almost 50,000

different kinds — through 620 company — owned

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stores. But while its products may mundane, its

financial performance is anything but: profits have

been rising at over 38% per year for five years,

and the total return to shareholders of over 40%

annually was higher then Coco-Cola’s or GE’s.

Whatever accounts for that kind of performance,

it’s certainly not the company’s fringe benefits.

When Bob Kierlan, the company’s founder and

president travels (or, often, his firm’s, other

employees travel), doesn’t fly business class; in

fact, he doesn’t fly at all. On one recent trip, for

instance, he drove 5,000 miles round trip in one of

the company’s vans. He and the company’s chief

financial officer denied on that trip at Burger King

and Subway. And following company policy, they

didn’t get reimbursed for their road meals since

‘‘you’ve got to eat anyway”. When they travel,

employees stay at Days Inn-type establishments.

Furthermore, the company provides on stock

option, 401 (k), or other pension plans. At

Fastonal, the “benefits” are more often in terms of

the wide range of decisions employees get to make

and the opportunity to quickly move up and

manage a company store, often after only six

months at the company.

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Questions :

(a) It would be an exaggeration, of course, to

imply that the company offers no benefits at

all. What sort of benefits must a company like

this absolutely provide in order to successfully

recruit and retain high-quality employees?

Why?

(b) What are the advantages and disadvantages to Fastonal of offering a pension plan? Do you think it should implement one? ‘Why or why not?

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(DBUS 38)


Final Year


Paper II — MANAGING CHANGE IN ORGANISATIONS




1. (a) Concept of change management.

(b) Resistance to change.

(c) Simulation.

(d) Organisational interventions.

(e) OD in NGO.

(f) Change programme.



2. Discuss the relationship between organisational change and culture.

3. What are the essentials of effective method of implementing change?

4. Bring out the salient features of diagnostic methodology.

5. What are the causes for the failure of change?

6. Describe manager has an agent of change.

7. Give an account of the features of planned change.


(Compulsory)

8. Emily who has the reputation of being an excellent worker, is a machine operator in a furniture manufacturing plant that has been growing at a rate of between 15 per cent and 20 per cent each year for the past decade. New additions have been built onto the plant, new plants opened in the region, workers hired, new product lines developed, lots of expansion, but no significant changes have occurred in overall approach to operations, plant layout, ways of managing workers, or the design processes. Plant operations as well as

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organizational culture are rooted in traditional Western management practices and logic, based largely on the notion of mass production and economies of scale. Over the past four years, the company has been growing in number and variety of products produced and in market penetration; however, profitability has been flattening and showing signs of decline. Therefore, in developing their strategic plans, management is beginning to focus on production operations (internal focus) rather than mainly focusing on new market strategies, new products, and new market segments (external focus). They hope to get manufacturing costs down and improve consistency of quality and ability to meet delivery times while decreasing inventory and increasing flexibility.

One of several new programs initiated by management in this effort to improve flexibility and lower costs was to cross-train workers. However, when a representative from Human Resources explained this program to Emily’s supervisor, Jim, he reluctantly agreed to cross-train most of his workers, but not Emily.

Jim explained to the Human Resources person that Emily works on a machine that is very complex and not easy to effectively operate. She has to “babysit” it much of the time. He has tried many workers on it, tried to train them, but Emily is the only one who can consistently get product through the machine within specification and still meet production schedules. When anyone else tries to operate the machine, which performs a key function in the manufacturing process, it ends up either being a big bottleneck or producing excessive waste, which creates a lot of trouble for Jim.

Jim goes on to explain that Emily knows this sophisticated and complicated machine inside and out after running it for five years. She likes the challenge, she says it makes the day go by faster, too. She is meticulous in her work, a very skilled employee who really cares about the quality of her work. Jim told the HR person that he wished all of his workers were like Emily. In spite of the difficulty of running this machine, Emily can run it so well that product piles up at the next workstation downstream in the production process - no one can keep up with her!

Jim was adamant about keeping Emily on this machine and not cross-training her. The HR person was frustrated. He could see Jim’s point but he had to follow executive orders. “Get these people cross-trained”.

Around the same period, a university student was doing a field study in the section of the plant where Emily worked. In her interview, Emily told the student that, in spite of the fact that the plant had some problems with employee morale and excessive employee turnover, she really liked working there. She liked the piece rate pay system very much and hoped that she did not have to participate in the recent “Program of the Month”, which was having operators learn each other’s jobs. She told the student that it would just create more waste if they tried to have other employees run her machine. She told him that other employees had tried to learn how to operate her machine but couldn’t do it as well as she could.

Emily seemed to take a special liking for the student and began to open up to him. She told him that her machine really didn’t need to be so difficult and touchy to operate with a couple

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of rather minor design changes in the machine and better maintenance, virtually anyone could run it. She had tried to explain this to her supervisor a couple of years ago, but he just told her to “do her work and leave operations to the manufacturing engineers. “She also said that if workers upstream in the process would spend a little more time and care to keep the raw material in slightly tighter specifications, it would go through her machine much more easily and trouble-free, but they were too focused on going fast and making more piecerate pay. Emily expressed a lack of respect for the managers, who couldn’t see this, and even joked about how “managers didn’t know anything”.

Questions:

(a) Identify the sources of resistance to change in this case.

(b) Discuss whether this resistance is justified or could be overcome.

(c) Recommend ways to minimize resistance to change in this incident or in future incidents.

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(DBUS 39)


Final Year


Paper III — ORGANISATIONAL DYNAMICS




1. (a) Group alienation

(b) Burnout

(c) Delphi technique

(d) Strategic alliances

(e) Empowerment

(f) Quality circle.



2. What are the elements of group behaviour?

3. Describe the phases in group development.

4. Distinguish between role conflict and role ambiguity.

5. What are the sources of authority?

6. State the features of learning organisation.

7. Give an account of the issues in Cross Cultural dynamics.

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(Compulsory)

8. Case Study :

George A. Hormel & Company has many meat packing plants around the country and one of

these plants is located at Austin, Minnesota. During the mid 1980s, the company was faced

with a decreasing demand for its products. It became necessary to cut the costs of operation

in order to remain in business and competitive. To keep its costs down, the management of

the company cut the base wages of its union employees. This was done arbitrarily and

without consulting or negotiating with the union representatives. Even though the dispute

between the union and the management had been simmering for a long time at the plant in Austin, it culminated in a strike led by the union in August of 1985.

An arbitrator was appointed to act as a mediator and due to his recommendation, some of the

cuts in wages were restored. The management offered to restore the balance of the cuts at

the time when the previous labor contract would expire and a new contract would be signed. The new contract was signed by all the unions at all other Hormel plants, except the one in

Austin, and hence the strike. Because of the worker’s strike, the plant was shut down.

The strike lasted for nearly five months. The strike had not yet been settled when the

management at the Austin plant decided to reopen the plant, and accordingly, some union

packers returned to work. Many other workers refused to return to work and formed a picket

line and the local union urged its members not to cross the picket line. The management

started to hire new workers to replace those who were on strike. There was a conflict between the employees and the workers on strike, so much so, that at one time there was a

danger of physical violence and local police had to be called into restrain the workers who

were on strike.

The local union sent some of its members to picket other Hormel plants and asked the union

members at these other plants to honor the picket lines and not report for work. About a

week after the Austin plant was reopened, the central management fired hundreds of their

workers at plants in Texas, Iowa and Nebraska for refusing to cross the picket lines and

refusing to report to work. This step was significant because picket lines at these other

plants were not set up by the local employees but by the striking employees at the plant in

Austin.

The strike at the plant in Austin went into ninth month. Tempers flared and violence

erupted and in May 1986 hundreds of strikers fought with police outside the Austin plant.

The parent union, United Food and Commercial Workers also disagreed with the striking

workers prompted by the local union, considering the economic slowdown and conditions in

the industry. The President of the parent union decided to take over the operations of the

local union and started proceedings to appoint a new union leadership at this plant. He

believed that the conflict had gone too far and he hoped that with these changes, the strike would be over and the workers could go back to work.

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Questions :

(a) Given the conditions of economic slump, do you think the workers were wrong in going

on strike. Give reason.

(b) Is the conflict between union and management inevitable? What preventive steps can be

taken to avoid the possibility of worker strike? Explain your view points.

(c) Who were the winners and the losers in this conflict?

(d) If you were hired as a mediator, after the union went on strike, what steps would you

recommend in order to minimize the negative impact of this conflict.

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(DBUS 40)


Final Year

D-International Management

Paper I — INTERNATIONAL BUSINESS




1. (a) Transnational corporation

(b) Control system

(c) Regional trade grouping

(d) Ethno centrism

(e) MFN status

(f) Protectionism.

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2. What are the key drivers for adopting International Business?

3. Critically examine any one theory of International Business.

4. Describe the process of knowledge management in the International organisations.

5. State the cross cultural issues that might affect International Business.

6. Explain the issues that relate to International HR management.

7. Enumerate the techniques employed to measure the performance in International Business.


8. Case Study :

Tata Motors, India ltd, has successfully launched NANO a small car with a price tag of Rs. One Lakh for meeting the dreams of the lower middle

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class and those who reside in class II and III cities in India. The product launch was successful and the company has its order book for the coming 5 five years. NANO not only attracted the clientele of India but also the attention of many countries. It was named as $2500 wonder car. There are enquiries from different car manufacturing and distribution companies for launching the car either on Licensing mode or import of fully finished products or SKD/CKD kits. Amazed at the encouraging response from different parts of world, TATA Motors Ltd. requested ORG and Indian marketing research firm to come out with the estimate of market potential in different parts of the world and how to meet the market potential.

(a) Do you think that the launch of NANO as a global brand will be successful? Give reasons.

(b) If TATA decides to launch NANO in global markets what segmentation it has to adopt?

(c) What are the likely changes that can happen in the global environment for small cars?

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(DBUS 41)


Final Year

D – International Management

Paper II — INTERNATIONAL FINANCIAL MANAGEMENT


SECTION A — (3 × 5 = 15 marks)


1. (a) Concept of international financial management.

(b) Foreign exchange market.

(c) Accounting exposure.

(d) Floating rate.

(e) International inventory management.

(f) IMF.

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2. Explain the finance function in an MNC.

3. Critically examine the working of IBRD.

4. Describe the different techniques of determining exchange rate.

5. Discuss the management of cash in an MNC.

6. What are the factors that may influence international financing decision?

7. State the sources of financing foreign trade.


Compulsory

8. Case Study

The Sports Exports Company converts British Pounds into Dollars every month. The prevailing spot rate is about $ 1.65 per pound, but there is much uncertainity about the future value of the pound. Jim Logaw, owner of the Sports Exports Company, expects that British inflation will rise substantially in the future. In previous years when British inflation was high, the pound depreciated. The prevailing British Interest rate is slightly higher than the prevailing US interest

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rate. The pound has risen slightly over each of the last several months. Jim wants to forecast the value of pound for each of the next 20 months.

(a) Explain how Jim could use technical forecasting to forecast the future value of the pound. Based on the information provided, do you think that a technical forecast of the Pound would reflect future appreciation or depreciation in the Pound?

(b) Explain how Jim could use fundamental forecasting to forecast the future value of the pound. Based on the information provided do you think that a fundamental forecast of the Pound would reflect appreciation or depreciation of the Pound.

(c) Explain how Jim could use a market based forecast to forecast the future value of the Pound. Do you think the market based forecast would reflect appreciation or depreciation or no change in the value of Pound?

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Final Year

(D – International Management)

Paper – III : INTERNATIONAL MARKETING


SECTION A – (3 × 5 = 15 marks)


1. (a) Concept of international marketing

(b) Social environment

(c) F T2s

(d) International sales policy

(e) International marketing mix

(f) Bill of lading

SECTION B – (3 × 15 = 45 marks)


2. Discuss the magnitude of international marketing.

3. Describe the institutions involved in the international marketing.

4. Explain the impact of cultural environment on international business.

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5. Elucidate the documents required for exports.

6. Enumerate the development of products for international marketing.

7. Critically examine the steps involved in the international marketing research.

SECTION C – (15 marks)

8. Case study (Compulsory)

It’s “You can’t Beat the feeling” in America; “I Feel Coca-Cola” in Japan ; “A Unique Sensation” in Italy ; and in Chile, “The Feeling of Life.” The subtle differences in these slogans reflect Coca-Cola’s philosophy regarding global marketing; Plan globally and act locally. In other words. Coca-Cola has developed a fairly standardized marketing strategy and views the entire world as a single market, but it is also sensitive to local cultures. The formula has succeeded. International sales account for about 80 percent of Coca-Cola’s profits.

But Coca-Cola, like many firms, is finding growth difficult. Coca-Cola’s-share of the grocery store soft drink market fell from 61.8 to 60.4 percent in 1991. One point of market share is worth about $460 million in sales. Some cola drinkers are changing to cheaper store brands like. Wal-Mart’s Sam’s American Choice. Noncolas like Dr Pepper and Barq’s root beer have also grown in popularity, along with flavored seltzers, juice drinks, and “natural” sodas.

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Changing tastes and falling market share have Coca-Cola looking to Eastern Europe for new market opportunities. Since 1989, Coca-Cola has invested $450 million in Eastern Germany. Former East Germans, who watched Coca-Cola commercials on West German television for years, are crazy about Coca-Cola. Germany is Coca-Cola’s largest market among European Community nations. Which contributed $767 million in 1991 profits, more than the United States did. And in Moscow. Coca-Cola is building a $15 million production plant and training facility. At 177 rubles a can (27 cents), not many Russians can afford it yet, but Coca-Cola has plans to stay in Russia for the long haul. They are planning to build a $50 million production plant in St. Pertersburg.

Horst’Muller, the hed of Coca-Cola’s operations in eastern Germany, encountered one major difficulty — finding sales representative. Muller needed sales representatives to handle orders, deliveries, and sales promotions, but the people of eastern Germany come from a culture where selling is a foreign idea. So he turned to his 2,100 employees, many of whom came from former. East German plants that Coca-Cola bought from the state. The friendliest technicians, factory workers, and clerks were sent to the West for sales training. The result was an enthusiastic team of sales representatives hustling for new business. Coca-Cola sold 74 million cases of soda in eastern Germany in 1991, up from zero cases the previous year.

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With this level of success. Coca-Cola expects to take on Pepsico, Inc., which has had a stronghold in most of Eastern Europe and the former Soviet Union for years, Pepsi has always been weaker than Coca-Cola in Germany, and Coca-Cola’s dominance in Western Europe (where it outsells Pepsi 6 to 1) has helped bring Coca-Cola closer to lucrative markers in Eastern Europe dominated by Pepsi. Industry analysts expert Coca-Cola to start shipping to Poland from its eastern German plants. Coca-Cola also has facilities planned for Bulgaria, Romania, Czechoslovakia and Russia.

Success with not come easy for Coca-Cola in eastern Europe. PepsiCo, already has sixty-five bottling plants in Eastern Europe and the former Soviet Union. Awareness of the Pepsi brand is higher than of any other brand. Pepsi sold 45 million cases in the former Soviet Union alone in 1991, and has allocated $1 billion for global expansion. But as the cola wars are staged on new ground in the future, many expect Coca-Cola’s superior global resources to neutralize PepsiCo’s advantage in Eastern Europe.

Questions for Discussion:

(a) Does Coca-Cola have a global marketing strategy’s? Explain.

(b) What cultural barriers did Coca-Cola encounter in eastern Germany?

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(dbus 31) - anucde · (dbus 31) m.b.a. degree examination, ... critically examine the capital...

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