monika project

7/30/2019 Monika Project

1/86

CHAPTER:-1

INTRODUCTION OF COMPANY

1


2/86

OVERVIEW

Corporate head: - ITI DOORVANINAGAR, BANGALORE

Manufacturing units: - Bangalore (Karnataka)

Naini (near Allahabad UP)

Rae Bareli (UP)

Mankapur (UP)

Palakkad (Kerala)

Srinagar (Jammu & Kashmir)

Network system unit: - Bangalore

Regional officers: - New Delhi

Bangalore

Kolkata

Lucknow

Mumbai

Chennai

Hyderabad

Bhubaneswar

Bhopal

Ahemdabad

Kochi

Supported by 36 area offices all over the country

Manpower : - 1294

R&D : - Bangalore, Naini, & Mankapur

Quality system: - ISO 9000:2000, ISO 14001:2004

2


3/86

ITI A GLIMPSE

ITI Ltd is Indias largest and first public sector unit developed to manufacture

telecommunication products with the latest technology. This is bedrock upon which

India is launching its contribution to the worlds telecommunication revolution. ITI

Ltd is the premier public sector undertaking of the country. It was the first public

sector unit to be opened by government of India after independence in the year

1948-49. It was located at Bangalore. The activities of this public sector were

manufacturing mechanical telephone instrument & exchanges Due to advancements

in technology in the field of electronics, ITI started its expansion program in the field

of electronic in 60s.

Communication is our business was the motto adopted by ITI. With this

motto in mind, ITI started its business in communication field. From a small

beginning, it has grown in to a month multiunit enterprise with manufacturing units at

Doorvani Nagar & electronics city in Bangalore, Mankapur, Naini, & Rae Bareli in

UP, Pallakad in Kerala & Srinagar in J & K, in addition to these manufacturing unit

located at Bangalore for undertaking installation & maintenance of

telecommunication equipments through the country which is now renamed as

Network communication Business group. The company has a strong in house R & D

infrastructure attached to the independent business group. The main R & D divisions

are located at Bangalore & Naini. Looking forward at the technology, the R & D is

engaged in continuous development & absorption technology.

A large number of companys products are covered under the Self

Certification Scheme by the major consumer i.e. Department of Telecommunication.

3


4/86

ITI IS KNOWN FOR

Manufacturing of telecommunication equipments

Value added services

Turnkey projects.

Network management

Research and Development

Mobile Radio Trunked service

Software Application.

MISSION

To be the leader in the domestic market and an important global player in

voice, Data and Image communication by providing total solution to customer. To

build on core competencies to enter business areas.

Organisation chart

4


5/86

Chairman & Managing Director

K.L. Dhingra.

Director (Marketing)

R.K. Agrawal

Director (Finance)

Ravi Khandelwal

5


6/86

Director (Production)

K.K. Gupta

Director

N.K. Joshi

Director

S.P. Kochar

Company Secretary

Mrs. Rachana Chaudhary.

Independent Director

Prof. M. Balakrishan

Mr. T.S. Narayanasami

Dr. S.K. Chaudhuri.

6


7/86

MANAGEMENT OF CHAIN

Ministry of Telecommunication

Chairman Managing Directors

Board of Directors

Executive Directors (EDR)

General Manager (Head of unit)

Assistant General Manager

Deputy General Manager

Chief Manager

Manager

Deputy Manager

Assistant Manager

Engineer

Assistant Engineer

Staff (Employees)

7


8/86

CHAIN OF NEW UNITS

In addition to the present unit at Bangalore, manufacturing the telephone &transmission equipment, it has grown in to a multiunit enterprise with other

manufacturing enterprise with other manufacturing units established at Doorvani

Nagar & electronic of Bangalore, Mankapur, Naini, Rae Bareli, Pallakad in Kerala &

Srinagar in Jammu & Kashmir.

The company now manufactures the entire range of telecommunication equipment

right from telephone instruments to equipment for Satellite Earth Stations catering tothe DOT, MTNL, Defense services, Railways & state electricity boards. It also tries

to meet the requirements of the private customers for automatic exchanges.

Besides this ITI also produces the road-traffic signals of high reliability & variety of

tonometry & tele-control equipment. The latest production of ITI today is SDH &

WILL. In future ITI is planning to switch over to ATM from SDH.

Apart from supplying to the domestic market ITI has also taken up Turnkey projects

abroad & has been exporting its products as many as 20 other countries. The

company has received fewer tenders as compared to global competition. On the basis

of its quality & price, it is striding towards attaining organizational excellence.

ITI is today n market-oriented company, growing in to total solution provider. It is

striving towards achieving excellence.

8


9/86

SPECIAL ACHIEVEMENT

During the year under review, the company has produced 3.06 million lines ofswitching equipments that included 200kl of new C-DOT MAX XL Exchange.

Bulk production of SMPS to tune of Rs 28.70 crore & bulk production of Digital

Microwave (SDH) equipments were its major achievements. Optical fiber systems

(SDH), being newly inducted in the Indian network were supplied for the first time.

The company is placed first for supply of 1.69 million line of new technology

exchange & for supply of 770 numbers of 2/140 Mbs Optimux along with

regenerator.

9


10/86

PLANTS

1. BANGALORE PLANT (Established in 1950)

2. SRINAGAR PLANT (Established in 1970)3. NAINI, ALLD PLANT (Established in 1971)

4. RAE BARELI PLANT (Established in 1973)

5. PALAKKAD PLANT (Established in 1975)

6. MANAKAPUR PLANT (Established in 1980)

10


11/86

AWARDS

Excellent performance PSE awards in the year 1997-98 given by INDIAN

INSTITUTE OF INDUSTRIAL ENGINEERING.

Best CHIEF EXECUTIVE GOLD AWARD by INTERNATIONAL GREEN L &

SOCIETY on September 17, 1998.

FACT MKK NAIR PRODUCTIVITY AWARD by KERALA STAT

PRODUCTIVITY COUNCIL.

INSPECTION SCHEME (AIS) of PALAKKAD plant has been certified underAPPROVER SUPPLEMENT OCB 283 crore equipment to DOT, MTNL.

INDUSTRIAL SAFETY AWARD by NATIONAL SAFETY COUNCIL.

JOINT VENTURES

Widening its area of operation, ITI teamed up with PACIFIC INTERNATIONAL

COMPANY to manufacture micro earth stations. The result is ITI equatorial Satam

Ltd. (IESL); beside this earth station IESL also undertakes turnkey projects in various

parts of the world. ITI Communication Pvt. Ltd. (ITIC) is a joint venture company set

up in Singapore with the main objective of promoting exports of ITI products to other

countries.

Fibcom India Limited, New Delhi, has also made joint venture with NKT Denmark

for SDH/ PDH fiber optical product

The ITI has collaborated with a number of foreign-based companies having the latest

technology. They are as follows.

Name of the Company Country Technology

M/s Siemens/Nee Japan For Marr/ PCM.

M/s Ericson Sweden For level measuring unit.

M/s AWA Australia For SCATS road traffic system.

11


12/86

M/s Nee Japan For PCM (26 version)

M/s Alcatel France For large digital Switch

M/s Comedge Singapore For cordless phones

ISO 9000 SERIES STANDARDS

The International Organization for Standardization (ISO) is the specialized

international agency for Standardization, at present comprising the national standard

bodies of 91 countries including India. ISO is made up of approximately 180

Technical Committees. Each technical committee is responsible for one many areas

of specialization.

The object of ISO is to promote the development of standardization & related world

activities with a view to facilitating international exchange of goods & services & to

develop cooperation in the sphere of intellectual, scientific, technological & economic

activity. The results of ISO technical work are published as international standards.

WHY THEY SHOULD BE USED?

The ISO 9000 is an opportunity & a challenge to developing nation. They can now

know with a good degree of certainty the level of quality that purchasers expect. They

can also learn the prerequisites & characteristics of good quality assurance & quality

management. The challenge to the developing nation is to motivate processors &

manufacturers to adopt & implement these standards & to establish a credible

national quality registration scheme, which will be recognized by the trading partners.

With the increasing number of markets & industries, third party quality assessment &

registration is becoming a pre-requisite for doing the business, ISO 9000 is

considered the minimum acceptable level for a supplier, & those who cannot

demonstrate this level may not have difficulty in selling in certain markets; they may

be barred from those markets.

12


13/86

Without ISO 9000: registration can face higher insurance rates or be denied insurance

in some markets. In addition 9000: series standards also

Motivates exporters

Sets a baseline

Establishes reasonable standard for government procurement

Focuses training & professional development

Sets general markets procedure for regulating health & safely

Reduces time consuming audits by customer & regulators

Give marketing advantages & EC 92 positioning

Raises levels of motivation, co-operation, workmanship & quality

awareness

Improves efficiency, reduces scrap & rework

13


14/86

MAJOR LANDMARKS

YEAR ACHIEVEMENTS1971.72 Start of production.

1973.74 Production of Telephone developed in house.

1980-81 Assoc ham awards for promotion of ancillary

industries

1981-82 Establishment of computer centre

1986-87 Collaborations.

1986-88 Face to update Telephone manufacturing.

Technology & establishment of P.C.B.

1989-90 Single & Double sized P.C.B. & production of

140 mibt optical line equipment & regenerator

in collaboration with M/s Denmark.

1991-92 Introduction of 565-mibt optical line

equipment & manufacturing of in-house

design Telephone model ME-91 & TPS -90

1994 Advanced of optical line equipment.

1995 Implement Q.D.C. & ISO 9000.

1996 Collaboration with M/s Fibcom India Ltd. &

Solar photovoltaic were manufactured.

1997 Developed MARR & manufactured it along

with 8 mbit & 140 mbit opticmux equipment.

1998 Production of DDF focus version.

1999 Started in the worlds latest equipment i.e.

Digital loop Carrier (PDH) & production of

2/15 single channel equipment.

2000 Developed & production of D.L.C. (SDH) &

Access terminal along with the production of

the central office terminal racks.

2001 COT (central office terminal) reckers system.

2002 Development of fiber Distribution frame.

14


15/86

2003 Development of FORDAR for defence.

2005 Calibnation with AC CATFC for manufacture

of ADSC.

2006 STM-1, STM-4, STM-16

2008 STM-1. STM-4, STM-16, Transmission

equipment DWDM.

CUSTOMERS

About 90% of the ITI products are supplied to BHARAT SANCHAR NIGAM

LIMITED (Formally known as DEPARTMENT OF TELECOMMUNICATION /

DOT). The other significant customers of the company are as follows.

Bharat Sanchar Nigam Limited (BSNL)

Videsh Sanchar Nigam Limited (VSNL)

Maha Nagar Telephone Nigam Limited (MTNL)

Railways

Defence Banks

Corporate

Factories / Offices

Steel/ Power/ Oil Sector

General

Public

15


16/86

IMPLEMENTATION OF GOVERNMENT POLICY OF ECONOMIC

LIBERALIZATION AND ITS CONSEQUENCES

The monopoly of ITI was broken by Govt. of India in 1991 as by opening the door to

the private sector & thus competition emerged.

ITI has been selling its instrument since 1968 to the Govt. sector, previously the

Telecom sector was under total control of Govt. with change and open door policy of

Govt. selling pattern has been changed therefore ITI has also entered the market and

is facing competition with others. Some major problems faced by ITI are as follows

Missing good professionals in marketing area

Lack of availability of raw material on time

Lack of autonomy to take decision

Need more innovation and technology upgradation

Need more employee support

Large quantity of waste products

Lack of awareness in workers

Fund crisis

Low market potential

REASONS FOR PROBLEM

Faulty Government policy

Non availability of orders

Fund crisis

Excessive overhead expenditure

Lack of publicity and advertisement

Lack of sales promotion schemes

Lack of upto date features as per customers demand

16


17/86

COMETITIVE BACKGROUND

Till 1991, ITI enjoyed monopoly, but very soon after 1992 the position was

completely changed. It was also one of the sectors that had been liberalized. This

sector was thrown open to the private sector and thus competition stepped in ITI has

been selling basic telephone instruments and transmission equipments since 1968 to

the Govt. sector. Till now, the telecom sector was entirely in the control of the Indian

Govt. but with the liberalization and open door policy the selling pattern changed and

ITI had to face competition with the major players like the following :-Competitors of Telephone instruments:-

BPL

BEETEL

TATA

PANAPHONES

ORPAT

PUNWIRE

BEL

WETSON

Competitors for Radio Equipments:-

ARM

NATALCO

PCL

MCS

PUNWIRE

SHYAMWIRE

Competitors for Transmission Equipments:-

HFCL

DSC (at present TELLABS)

17


18/86

NATALCO

UTL

BEL HTL

FUJITSU

ALCATEL

Competitors for EPABX System

BPL TELCOM

L & T LIMITED

L G ELECTRONICS

NORTHERN TELECOM

TATA TELECOM

SIEMENS INFORMATICS SYSTEM LIMITED

SAMSUNG ELECTRONIC CORPORATION

18


19/86

BIO-DATA (ITI-NAINI)

Name - ITI Ltd NainiBusiness address - ITI Ltd Naini

Mirzapur Road, Allahabad 211010

Phone no. - 0532-2687401-07

Fax no. - 0532-2687345, 2686008

Website - itiltd-india.com

Email - [email protected]

Year of registration - 1971

Registered office - New Delhi, Bangalore, Kolkata, Lucknow,

Mumbai, Chennai Hyderabad, Bhubaneswar,

Bhopal, Ahmedabad, Kochi.

Government council - Ministry of Telecommunication. (Govt of

India).

Head of the Unit - Mr. P.K. Gupta.

Employee strength - 1294

Product line - Various models of Telephones & different types

Of Transmission Equipment.

Market - BSNL, VSNL, MTNL, NTPC, ONGC, Railway,

Defence, Corporate & General public

Competitors - HFCL, FIBCOM, BEL, TEJAS, SIEMMEMS,

PUNCOM, HUAWEI, ZTE, ETC.

19
mailto:[email protected]:[email protected]


20/86

MANAGEMENT OF ITI LTD :- NAINI UNIT

UNIT HEAD

Mr. P.K. GUPTA

DEPUTY GENERAL MANAGER (W&C)

Mr. A.K. AGRAWAL

CHIEF MANAGER FINANCE

Mr. R.K. CHAWLA

20


21/86

ITI Ltd. NAINI

COMPANY PROFILE

ITI Ltd., Naini was established in the year 1971 as the second senior most of the ITI

group. It is one of the giants of the Telecom Industry, which is situated 16 kilometers

from the holy city of Allahabad. It employs a large of staff members including

officers. Since it is situated 16 kms from the main city, it has provided the employees

with buses as the mode of transport. It also provides other facilities like I.T.I. colony

for lodging of the workers, medical facility and schooling facility for the employees

ward etc.

In Naini there are four departments, namely, Telephone Equipment Division (TED),

Telephone Instrument Division (TID), Central Division. Research and Development

(R&D). Beginning with a moderate production of 1.66 crore in 1971 it reached to 306

crore in 1992-93. But in 295-96 it received a major setback just after the

implementation of liberalization policy. During the year the performance of I.T.I.

Naini division dropped drastically. The total sales were estimated at 73 crore in the

year 1995-96 in the 1998-99 the sales boomed to 10 crore.

MANPOWER

Manpower profile as on 1st June 2011:-

OFFICER 791

NON-OFFICER 503

TOTAL STRENGTH 1294

The value, ethics, interpersonal chemistry and congenial working environment make

this organization a cohesive, articulate and goal directed unit. The collective wealth

of experience of the management personnel in the field of production, quality,

control, formulation, marketing, sales, finance and accounts well for the organization

future.

The work culture aims to mobilize, direct and sustain individual efforts and

encourage active participation of every member of the organization. Continuous

21


22/86

efforts are being made to enrich human resource with the aid of orientation

programmes,

RESEARCH AND DEVELOPMENT

ITI has the most modern, well-equipped & technologically advanced R & D division.

The R & D is backed by a modern & systematic computer laboratory, automatic test

system laboratory, micro electronic & quality assurance laboratory. It is also using

SMD machine printed card assembly that has a capacity of 5000 components/hour.

The raw materials are accepted for production.

Management wants to charge prices that will least cover the total production costs at a

given level of production. Factors like overhead, material cost, laboratory costs,

excise duties etc. determine the price of a product. Manufacturing only after it is

found to he of the best grade by the in-house and independent laboratories. Finished

products are sent to the market only on approval of the a department.

HRD AND WELFARE ACTIVITIES

There is a well equipped training centre or the HRD centre where various kinds of

training takes place for the upliftment of trainees of professional courses by

experienced officials in the respective field. The apprentices of ITI are students from

Management, Engineering and also for Diploma courses. The training classes are

conducted throughout the year. Hence there is a special training centre to conduct and

coordinate this kind of training. ITI has implemented many welfare schemes for the

upliftment of the employees like medical facilities, canteen facility, transport facility,

safety and bonus etc.

PERSONNEL AND INDUSTRIAL RELATIONS

The companys faith in harmonious industrial

relations was characterized by readiness of the Union Officers Association

22


23/86

Management to work in union for growth of the company. Employee morale and high

level of commitment was the key factor in achieving the highest level of performance.

A satisfied workforce is the greatest asset for any organization. The degree of

satisfaction could be judged by analyzing the industrial relations climate of the

company. Now for the last ten years there is only one trade union in the unit and the

election of office bearers is held every year by a secret ballot. This practice has lead

to a peaceful atmosphere in the organization.

WORKERS PARTICAPATION IN MANAGEMENT

The ITI unit has given full participation to the workers representatives to have equal

rights to raise their issues and grievances in the following areas :-

Sports Council

Welfare Committee

Provident fund Committee

Canteen Management Committee

Community for the award of the best work to the workman for outstanding

performance each year.

Death Relief Fund Committee

House allotment committee for workers.

23


24/86

SWOT ANALYSIS OF ITI LTD. NAINI

STRENGTH WEAKNESS Company name Low non-DOT market share

Product quality High pricing.

Full government support Lack of proper marketing strategy, ineffective

& inefficient promotional strategy.

Oldest & well established

public sector company

Unable to maintain product quality

Huge capacity of

manufacturing

Overstaffing of employees

Efficient after sales

service

OPPORTUNITY THREATS

BSNL communication to

provide telephone

Poor service quality

Connection on demand Not able to meet deadlines

Skilled employees are

there

Not able to meet the demand.

New opportunities to enter

into cellular phone

services are there

Does not have good coordination with the

dealers and retailers

They can also enter into

electronic parts

manufacturing

Lack of teamwork spirit

Lack of proper customer surveys.

Entry of new competitors.

24


25/86

CHAPTER:-2CONCEPTUAL DISCUSSION

MARKETING

Marketing boasts a rich array of concepts and tools

WHAT IS MARKETING?

25


26/86

Marketing, more than any other business function, deals with customers

Understanding creating, communicating and delivering customer value and

satisfaction are at the heart of many modern marketing thinking and practice. We may

define MARKETING as. Marketing is the delivery of customer satisfaction at a

profit

Two fold goal of marketing is to attract new customers by promising superior value

and to keep current customers by delivering satisfaction.

What does the term Marketing mean? Many people think of marketing only as selling

and advertising. It is no wonder, every day we are bombarded with television

commercials, newspaper ads, direct mail campaigns, Internet pitches and sales calls. I

however selling and advertising is only the tip of the marketing iceberg. Although

they are important, they are only two of many marketing functions and are often not

the most important ones.

Today, marketing must be understood not in the old sense of making a sale telling

& selling but in the new sense satisfying customer needs selling occurs only after

the product is produced By contrast, marketing starts long before a company has a

product.

Social definition of Marketing:-

We define Marketing as a social and managerial process where by individuals and

groups obtain what they need and want through creating and exchanging products and

value with others.

Managerial Definition:-

Pater Drucker, an eminent management theorist puts it this way Marketing is the

process of planning and executing the conception, pricing, promotion and distribution

of ideas goods, services to create exchanges that satisfy individual and organizational

goals

26


27/86

ITI NEED FOR THE MARKETING DEPARTMENT

Till 1993-94 ITI enjoyed being the only producer in this field of Telecommunication

in India. It had the power of monopoly, which was snatched away as the

Governments policy was introduced. Previously ITI was producing and the market

was buying it at the price at which it was being offered and desired by ITI. With the

entry of competitors. ITI felt the need for a Marketing department. Hence in 1994, in

the month of April the Marketing department was established. Its main challenge is to

bring back the lost glory of ITI.

For this they are supposed to keep up to date the changing answers of the following

five questions:-

What business we are in?

Who are our main customers?

What does your customer want and desires?

How can we best distribute our products to then?

How can we make communications with them more efficiently?

MISSIONS AND OBJECTIVES

The company entered the New Year with an objective of achieving new horizons in

the year 2000. It entered the order book position of Rs. 1000 and had set an internal

production target of Rs. 2000 crores for the millennium year 2000. The Company

rollouts business plans, which will have greater focus on the emerging technologies

as a result of convergence of communication and computing. The thrust of the

company will be on providing turnkey solutions for it and data communications. The

company has launched a new millennium with the following aim :-

To increase Productivity

To achieve Profitability

To accept Parivartan

A new operation called Operation Chetna has been introduced which aims at

increasing the following:-

27


28/86

Profitability

Rejuvenation

RepositioningThus the missions and objectives may be stated as under :-

Creation of demand

Creation of product image and personality

Mass awareness about the product

Provision of efficient after sales service

Periodic arrangement of marketing research

Product modification and diversification as per customers specification

Increase in sales

Profits through customer satisfaction

Generate demand for telecom products through innovation

To become a strong service provider with major business thrust in telecom

network operations and value added services.

Strengthen the technology scanning capabilities to benchmark their products

/ services against global standards, identify new products, enable better maker

buyer decisions and identify potential partners.

Achieve global quality standards in all the products in the shortest time.

Introduce effective planning and control system for achieving delivery

schedules, streamlining production over the whole year and better inventory

control.

Create an environment that cares for the individuality and dignity of

employees.

Create a sense of achievement and involvement in the company.

Marketing Plan

The marketing plan operates at two levels. The strategic marketing plan lays out the

broad marketing objectives and strategy based on an analysis of the current market

28


29/86

situation and opportunities. The tactical marketing plan outlines specific marketing

tactics including advertising, merchandising, pricing channels and service.

Market Oriented Marketing Strategy

Market oriented marketing strategy is the managerial process of developing and

maintaining a viable fit between the organization objectives, skills and resources and

its changing market opportunity. The aim of strategic planning is to shape the

companys business and product so that they yield target profits and growth.

It is the marketing strategy that decides the success at the business unit level which in

turn decides the total corporations success. The linkage between marketing strategy

and overall corporate success is indeed direct and vital. And in this linkage lies the

significance of marketing strategy.

To understand strategic planning, we need to reorganize that most large companies

consists of four organizational levels:-

Corporate level

Division level

Business unit level

Product level

Corporate headquarter is responsible for designing a corporate strategic plan to guide

the whole enterprise it makes decisions on which businesses to start or eliminate.

Each division establishes a plan covering allocation of funds to each business unit

within the division. Each business unit develops a business unit strategic plan to carry

that business unit into a profitable future. Finally, each product level (product level

line, brand) within a business unit develops a marketing plan for achieving its

objectives in its product market.

Motto of Mktg. Department

Making waves in communication

29


30/86

Establishment of ITIs Marketing Department

The marketing system of ITI is in its infancy days. The requirement of this very

section was realized when many rival companies entered in the same business area

due to adopting liberalized economy by Govt. of India. There fore this department

came into existence in April 1994. The another reason to establish marketing division

is to get series of ISO certificates so that the product can be sold in global market.

MARKETING Inter relationship with other departments

PRODUCTION CONTROL (X)

To get delivery schedule of Standard / Existing products.

SYSTEM / CUSTOM ENGINEERING

For technical compliance, equipment configuration, technical

literatures, equipments, charts and related matters.

TECHNICAL COSTINGCost break up of existing products as well as newly developed products. In

addition it will also provide competent level costing for the purpose of spare

selling.

SALES (X)

For the feedback of dispatches and payments.

R & D

For technical clarifications related to customer made billed productsrequired by the customers.

FINANCE

For arranging bid security against BSNL / NON BSNL tenders.

MARKETING PROCEDURE OF ITI, NAINI

REVIEW OF TENDER STAGE

30


31/86

The function of the marketing begins with the seeking for the tender & then receiving

the tender from the customers, which may be any of the following.

Bharat Sanchar Nigam Limited

Direct from Institutional Customers

Corporate marketing section

Regional offices

These above mentioned sources of enquires may be of two types.

Enquiry inviting tender bids

Urgent requirements of the customer.

31


32/86

32


33/86

TENDER ENQUIRY

After the receipt of the tender enquiry the marketing department studies & if the

requirements is different, a preliminary meeting. For taking decisions & a final

decision is taken. Tender document is taken. Tender document is then sent to the

system engineering department.

Technical compliance statement, equipment configuration & technical questionnaire

are prepared by the system engineering department after getting the tender document

by the marketing department & is again sent back to the marketing department for

further action. The marketing department finalizes the point to point complianceof commercial terms. If any clarification is required, the same is obtained from the

customer. Delivery schedule is taken from divisional head / concerned shop in

charge / production control.

After receiving the configuration from the system engineering the bid rate is finalized

in consultation with the technical costing & management.

On receipt of all the above information the tender form is filled up & all the

relevant information is attached to it as cited in the bid form.

Finally the tender is submitted to the purchaser.

At the time of tender opening, generally one representative from marketing / regional

offices is present. Comparative bids statement is also prepared.

REVIEW ON RECIEPT OF ORDER

On receipt of Letter of Intent (LOI) or Advance Purchase Order (APO) copies are

sent to sales (X) and ink signed copy to DM (BR).

The marketing departments sends APO / LOI acceptance to customer after getting the

feed back information, delivery schedule, and price schedule & price schedule &

equipment details as acceptable to us.

33


34/86

On receipt of the firm order, PO copies are sent to Sales (X) for dispatch advice &

also to the concerned sections & ink signed copies to DM (BR) Marketing department

also participates in the monthly review meeting for delivery schedule & customer

related problems coordinated by production control.

Present marketing strategy of ITI:-

The function of marketing department begins with seeking for the tender, then

receiving the tender from the customers come from:-

Bharat Sanchar Nigam Limited

34


35/86

Direct from institutional customer

Corporate marketing section

Regional offices

After receiving the tender they rotate a circular to plan and produce their product

according to norms. If there is any doubt regarding the order, they contact marketing

department, otherwise get the technical compliance statement requirement and

technical leaflet.

After checking all the technical aspect by system engineering department delivery

schedule is made by production department so that the order can be completed withintimeframe. After this the material list is sent to technical department. Then it is

transferred to purchase department to purchase material.

After getting the order marketing department issue an order copy to the sales

department for the execution, get details of material supplied against respective order

from the sales department. By supply of furnished product to the related concern and

received by that firm within time work of marketing department use to complete.

Theoretical backdrop and literature review about the project is required

Product under study - Various transmission equipments

Product market - BSNL & NON BSNL (ONGC, VSNL, MTNL,

Railway, Defence, Electricity board, Private

offices, General public)

Earlier status of the organization - :

DOT (now BSNL) was the only to establish infrastructural facility of telecom in

the country

The telecom field was reserved only for the public sector

Being public sector ITI enjoyed full support of Govt.

It produces product as per demand of DOT.

35


36/86

There was a positive co-ordination between DOT & ITI as a result it was the

Profitable public sector enterprise.

Present status of the organization -:

ITI is one the largest sufferers of the liberalization policy.

Apart from ITI, BSNL is purchasing products from other companies.

ITIs market share is decreasing due to reduction of orders.

ITI is suffering due to high labour / overhead cost.

OBSERVATION

By analyzing annual reports and other documents wee can observe that in this cut

throat competition ITI is continuously incurring loss due to its competitors. So to

move up ITI should redefine its marketing strategies against the present scenario of

liberalized economy to capture its old market share.

The major buyer of the telecommunication products is the Bharat Sanchar Nigam

Limited (BSNL)/ Department of Telecommunication (DOT). The BSNL has changed

purchase system with the changed policy of globalization. Earlier BSNL used to

purchase the products from ITI only, but now it is providing equal opportunities to all

the manufactures of telecommunication products. The BSNL has now adopted the

various marketing strategies like Tender Purchase System to have better quality

product at a lesser price. ITI has adopted various marketing practices like -:

Through open tenders

Through distribution channel

By direct enquiries from customers

Through BSNL circles.

36


37/86

Strategies which ITI marketing department should adopt

Targeting Strategy

Decision about targeting centre on two major strategies-the concentration strategy and

the multisegment strategy. Whether a company chooses one or other, the decision

should be based on a clear understanding of company capabilities and resources the

nature of the competition and the characteristics of the product market.

Concentration Strategy

When an organization directs its marketing efforts towards a single market segment

by creating and maintaining are marketing mix it is employing a concentration

strategy. The main advantage of the concentration strategy is that the firm can analyze

the characteristics and needs of a distinct customer group and then focus all its energy

on satisfying that groups needs. A firm can generate a large sales volume by reaching

a single segment.

Concentrating on one segment also means that a company puts all its eggs in one

basket clearly a disadvantage. If a companys sales depend on a single segment and

the segments demand for the product declines, the companys financial strength

declines as well.

Multisegment Strategy

An organization directs its marketing efforts at two or more segments by developing amarketing mix for each selected segment. After a firm uses a concentration strategy

successfully in one market segment, it sometimes expands its efforts to additional

segment.

A business can usually increase its sales in the aggregate market through a multistage

segment strategy because the firms mixes are being aimed at more people the

company with excess production capacity may find a multisegment capacity

advantageous because the role of products to additional segments may absorb this

37


38/86

excess capacity. On the other hand, a multisegment strategy often demands a greater

number of production processes, materials and people thus production costs may be

higher than with a concentration strategy. A multisegment strategy using firm

ordinarily experiences higher marketing costs. Because this strategy usually requires

more research and several different promotion plans and distribution methods, the

costs of planning, organizing, implementing and controlling marketing activities

increase.

38


39/86

CHAPTER:-3

PRICING POLICIES

39


40/86

INTRODUCTION TO PRICING

Pricing is perhaps the most important component in the marketing mix. while all

other elements in the marketing mix are cost factors, price is a revenue or income.

Pricing determines the viability of any business project because the demand and sales

revenue depend on the price. It is equally important for profit making and non-profit

making organizations. Fixing price is a problem for both.

WHAT IS A PRICE?

Price is commonly known as the exchange value of a product or service expressed in

terms of money. Price is paid for whatever services of products we receive, such as

rent for a house, fee of the Doctor, interest for the money etc. Whatever compensation

we pay for a particular product or service, we call the same as price in the strict sense

of the term. Price can be considered as the level between the buyer and the seller

regarding what catch item must get. Price is a device for translating into quantitative

terms the perceived value of a product / service to the customer.

Throughout most of history, prices were set by negotiation between buyers and

sellers. Fixed price policies - setting one price for all buyers is a relatively modern

idea that arose with the development of large scale retailing at the end of the

nineteenth century. Now some one hundred years later, the Internet promises to

reverse the fixed pricing trend and take us back to an era of dynamic pricing

charging different prices depending on individual customer and situations.

Price is the only element in the marketing mix that produces revenue. Price is also

one of the most flexible elements of the marketing mix. Price can be put in other

words as-:

40


41/86

Total market offerings = Bundle of Expectations / satisfactions

= Price

IMPORTANT OF PRICING

Pricing constitutes one of the four factors of marketing mix is an indicator of its

importance in the marketing programme. Price is equally important to both the seller

and buyer. Price denotes the value of the product / service expressed in terms of

money. The exchange of goods and services for transfer of ownership is possible only

when the buyer and seller settle the price and buyer agrees to pay or pays for it.

The demand and supply theory in economics is purely based on price mechanism.

The supply and demand conditions in the market is influenced by price, or in other

words price will changed according to demand and supply position in the market.

Price is the regulator of profit, production and distribution. Price also regulates the

consumption of a product to a very great extent, because price is the main factor in

making buying decisions by buyers.

Pricing also influences the marketing objectives of the company. Many areas of

marketing are directly influenced by pricing, such as Sales volume, Profits, Trade

margin, Return on investment, Product image, Sales promotion strategies etc. pricing

is also used as a sharp weapon in the marketing strategy in the competitive market.

FACTORS AFFECTING PRICING

There are many factors, which would affect the pricing decisions. These can be

grouped into as internal or external factors. Most of the internal factors have a direct

relationship with the objective of pricing. For instance, the image of the company has

a direct effect on the pricing. The internal factors are the factors, which are from

within the organization & are controllable by the management. The external factors

are those concerned with customers, competitors in the market in particular. These

41


42/86

factors especially competition, government policy and control etc. have to be taken

care of while formulating pricing strategies of the company.

INTERNAL FACTORS AFFECTING PRICING DECISIONS

MARKETING OBJECTIVES

Before setting price, the company must decide on its strategy for the product. If the

company has selected its target market and positioning carefully, then its marketing

mix strategy, including price will be fairly straight forward. Thus, pricing strategy is

largely determined by decisions on market positioning. At the same time, the

company may seek additional objectives. The clearer the firm is about its objectives,

the easier it is to set price. Examples of common objectives are survival, current profit

maximization, market share leadership and product quality leadership.

MARKETING MIX STRATEGY

Price is only one of marketing mix tools that a company uses to achieve its marketing

objectives. Price decisions must be coordinated with product design, distribution and

promotion decisions to form a consistent effective marketing program.

Companies often position their products

on price and then base other marketing mix decisions on the prices they want tocharge. Here price is a crucial product-positioning factor that defines the products

market, competition and design. Many firms support such price positioning strategies

with a technique called target costing, a potent strategic weapon. Target costing

reverses the usual process of first designing a new product, determining its cost, and

then asking. Can we sell it for that ? instead it starts with an ideal selling price

based on customer consideration, and target cost that will ensure that the price is met.

42


43/86

Other companies de-emphasize price and use other marketing mix tools to create

nonprice positions. Often, the best strategy is not to charge the lowest price, but rather

to differentiate the marketing offer to make it worth a higher price.Thus the marketer

must consider the total marketing mix when setting prices.

COSTS

Costs set the floor for the price that the company can charge for its

products. The company wants to charge a price that both covers all its costs for

producing, distributing and selling the product and delivers a fair rate of return for its

effort and risk. A companys costs may be an important element in its pricing

strategy. Companies with lower costs can set lower prices that result in greater sales

and profits.

A companys costs take two forms, fixed and variable. Fixed costs (also known as

overheads) are costs that do not vary with production or sales level. Variable costs

vary directly with the level of production. Total costs are the sum of fixed and

variable costs for any given level of

EXTERNAL FACTORS AFFECTING PRICING DECISIONS

THE MARKET AND DEMAND

Whereas costs set the lower limit of prices, the market and demand set the upper

limit. Both customer and industrial buyers balance the price of a product or serviceagainst the benefits of owing it. Thus before setting prices, the marketer must

understand the relationship between price and demand for its product.

COMPETITORS COSTS, PRICES AND OFFERS

Another external factor affecting the companys pricing decisions is competitors costs

and prices and possible competitor reactions to the companies own pricing moves.

43


44/86

OTHER EXTERNAL FACTORS

When setting prices, the company must also consider other factors in its external

environment. Economic conditions can have a strong impact on the firms pricingstrategies. Economic factors such as boom or recession, inflation and interest rates

affect pricing decisions because they affect both the costs of producing a product and

consumer perceptions of the products price and value. The company must also

consider what impact its prices will have on other parties in its environment. How

will resellers react to various prices? The company should set prices that give

resellers a fair profit, encourage their support and help them to sell the product

effectively.

PRICING POLICIES

The management may decide on the policies to be formulated for pricing its products.

Pricing can be based on the need of the consumers, or on the cost of production and

marketing or on the market conditions.

Need-based pricing is adopted by the government for public services like health,

education etc. cost based pricing or mark up pricing is followed by many companies,

such as supply of items on a periodic/ contract basis and products which less

competitors etc. the market based pricing is necessary for consumer goods.

Depending upon the products and their position in the market, the management has to

decide the policies to be followed in pricing. The management has to decide the

policies to be followed in pricing. The management has several pricing options in

deciding the prices. Some companies may decide to follow one price policy or

variable price policy or to act as leader in the market as regard as price is concerned.

The one price policy is found to be quite sound and reasonable. The company follows

a fair and fixed policy in line with the normal price market price, which ensures

reasonable profit. Under the variable price policy the buyers/ customers are

44


45/86

discriminated and bulk buyers and valuable customers are offered favorable terms

while others are not given the same

PRICING APPROACHES

COST BASED PRICING

The simplest pricing method is cost-plus pricing: adding a standard markup to the

cost of the product. To illustrate markup pricing we may consider the following

example -:

Variable cost = $10Fixed cost = $ 3, 00,000

Expected unit sales = 50,000

Now, cost/ unit is given by -:

Unit cost = Variable cost + Fixed cost/ Unit sales

= $ 10 + $ 3, 00, 000/ 50,000

=$ 16

Now, suppose the estimated markup is 20% on sales, then the markup price is given

by -:

Markup price = Unit cost / (1- Desired Return on Sales)

= $ 16/ (1=0.2)

= $ 20

Thus the charged price would be $20 and the profit would be $4 per unit.

VALUE BASED PRICING

An increasing number of companies are basing their prices on the products perceived

value. Value- Based pricing uses buyers perceptions of value. Value Based pricing

means that the marketer cannot design a product and marketing program and then set

45


46/86

the price. Price is considered along with the other marketing mix variables before the

marketing program is set.

COMPETITION BASED PRICING

Consumers will base their judgments of a products value on the prices that

competitors charge for similar products. One form of competition- based pricing is

going rate pricing, in which a firm bases its price largely on competitors prices,

with less attention paid to its own costs or to demand. The firm might charge the

same, more or less then its major competitors. Competition-based pricing is also used

when firm bid for jobs. Using seated bid pricing, a firm bases its price on how it

thinks competitors will price rather than on its own costs or on the demand. The firm

wants to win a contract, and winning a contract requires pricing less than other firms.

Yet a firm cannot set its price below a certain level. It cannot price below cost without

harming its position. In contrast, the higher the company sets its price above its costs,

the lower its chance of getting the contract.

PRICING STRATEGIES

Pricing policies are general guidelines for recurrent and routine issues in marketing.

Strategy is a plan of action to adjust with changing conditions of the market place.

New and unanticipated developments may occur. These situations demand special

attention and relevant adjustments in the pricing policies change from time to time.

The types of strategies that a company may adopt may of the following types.

MARKET SKIMMING PRICING

Many companies that invent new products initially

set high prices to skim revenues layer by layer from the market. Market skimming

makes sense only under certain conditions. First the products quality and image must

support its higher price and enough buyers must want the product at that price.

Second, the costs of producing a smaller volume cannot be so high that they cancel

46


47/86

the advantage of charging more. Finally, competitors should not be able to enter the

market easily and undercut the high price.

MARKET PENETRATION PRICING

Rather than setting a high initial price to skim off

small but profitable market segments, some companies use market penetration

pricing. They set a low initial price in order to penetrate the market quickly and

deeply, to attract a large numbers of buyers quickly and win a large market share.

PRODUCT LINE PRICING

This means setting the price steps between various products in a product line based

upon cost differences between the products, customer evaluations of different features

and competitors prices.

PRICE ADJUSTMENT STRATEGIES

The two popular types of price discounts are -: Cash discount

A cash discount is a quantity reduction to buyers who pay their bills promptly. Such

discounts are customary in many industries and help to improve the sellers cash

situation and reduce bad debts and credit-collection costs.

Quantity discounts

A quantity discount is a price reduction to the buyers who buy large volumes. By law,

quantity discounts must be offered equally to all customers and must not exceed the

sellers cost savings associated with selling large quantities. These savings include

lower selling, inventory and transportation expenses.

PRICING STRUCTURE OF ITI

47


48/86

During 1996-97, ministry of communication decided that ITI would get 30% as a

reserved quota of any tender with L.I. price of the tender For the rest 70%, if ITI

companies then ITI will also get orders from BSNL. As per the planning of

communication ministry, ITI gets at least 1800 crores (as reserved quota) plus share

received through tender (i.e. 70%), But the problem with I.T.I. is that it will supply all

the orders in L1 rate of tender of each item. That is why I.T.Is profit margin is very

low and at the same time it is on the no profit, no loss basis. As I.T.I. is getting an

advance of 75% against reserve quota of 30% so I.T.I. is not facing any financial

problem for the procurement of material at least. Factors like overhead, material cost,

laboratory costs, excise duties etc. determine the price of the product.

TECHNICAL COSTING OF THE TRANSMISSION

EQUIPMENTS

Product costing is done with the help of the database computer system. Whenever a

new product is introduced Technical Costing Section demands Bill of Material from

the computer center for all assemblies and sub-assemblies in order to list out variousassembly and mechanical components involved in that particular product. The EDP

department generates Bill of Material after receiving input data form System

Engineering, which consists of parent codes and route codes.

After ascertaining that the complete Bill of Material is available with EDP, Technical

costing asks the EDP to link the inventory rates with latest Inventory Rate Master,

which is being updated with the latest, weighted average Rates (WAR). Whenever no

purchases are made during the year, last years rates are taken. Even there are items for

which rates may not be available, under such situation EDP gives a Master list of Not

in to mechanical costing. This situation occurs due to the reason of either a substitute

material being used or the purchase order rate is not appearing for new items from

purchase department. After applying the normal levies, as the case may be in the

purchase order, we calculate the price of the material & feed in the Not in Master.

48


49/86

After feeding the rates from penned figure in the Not in the Master EDP complete

Bill of Material & linking with the inventory, rates are given to Technical Costing for

checking any discrepancies in the rates. Unit measures particularly the copper wires

& others are given in Kg & the unit measure with the Bill of Material in given in GM.

Extra care is being taken by technical costing in this regard.

49


50/86

For mechanical components, the methods department is supplying the process sheets/

layouts. The raw materials used, size, specification, & weight of raw material to make

1000 components as given in the process sheet/ layout. We calculate the cost of

mechanical components in following format.

The material cost of the material component is fed in the not in the master

along with the P.O. rates. After feeding all the inventory rates, P.O. rates for new

items & material cost of mechanical component, EDP supplies us with the three

statements of cost:

Assembly & sub-assembly wise cost sheet.

Value added cost sheet.

Final cost sheet.

Assembly and sub-assembly wise cost statement for individual assembly item is

given which includes cost of all inventory items and mechanical component in that

particular assembly or sub-assembly Value added statement consists of various

subsequent assemblies are added in the main assembly cost. Final cost statement

consists of the cost of complete assembly and sub-assembly cost and added value is

given.

50

Component code

R.M. & specification

Size of R.M.

Quantity WT. /1000

WAR Rate

Material cost


51/86

For labor cost calculation the time standards of various assembly, sub-assembly,

mechanical components and main assembly of the product is sought. Normally the

standards hours are for 1000 numbers. The standard hours are fed in the Bill of

Material along with the time standard. The shop Average Rates are calculated once in

year taking into account the pay details of all operative against whom DPRs are

booked which is supplied by the EDP department.

Since EDP only calculates one-year material cost and the labor and overhead costs are

calculated by feeling the information in the PC, overhead percent is applied based on

the 1986 approved by DOT and BICP.

51


52/86

CHAPTER:-4

RESEARCH METHODOLOGY

52


53/86

INTRODUCTION OF RESEARCH METHODOLY

In addition to information about competitors and environment happenings, marketers

often need formal studies of specific situations. In such situations, the marketing

intelligence system will not provide the detailed information needed Managers will

need marketing research.

We can define research methodoly as the systematic design, collection, analysis and

reporting of data relevant to a specific marketing situation facing an organization.

Every marketer needs research. A company can conduct marketing research in itsown research department or have some or all of it done outside, depending on its own

research skills and resources.

The marketing process research has four steps:-

53

Defining the problem and

research objectives

Developing the research plan or

review the literature

Collection of data

Analysis of data

Research Design (including

sample design)

Interpreting and adapting the

findings


54/86

STEP:1

DEFINING THE PROBLEM AND RESEARCH OBJECTIVE

54


55/86

DEFINING THE PROBLEM AND RESEARCH OBJECTIVE

The marketing manage and the researcher must work together to define the problemcarefully, and they must agree on the research objectives. Defining the problem and

research objectives is often hardest step in the research process. After the problem has

been defined carefully, one of the following objectives must be set :-

Exploratory research

Descriptive research

Casual research

PROBLEM

ITI being in this business for so long understands the ups and downs of this business

very well. Hence when the problem aroused due to liberalization and also due to

entrance of competition and ITI started loosing its market share and incurring losses,

it changed its pricing strategy and new policies were introduced. But still it continuedto be in losses even though its profits were increasing. Hence, it was necessary to find

out what the actual reason was for losses that were being incurred. For this reason we

carried on with this research to find:-

Whether the people were satisfied with the product or not and with the after

sales service?

Whether the price was competitive or not? Whether there was a demand in the market?

Why there was a lost being incurred every year even when the company sales

were increasing?

55


56/86

APPARENT PROBLEM

The apparent problem for losses being incurred was that prices were not competitiveenough hence the company was going into losses. Even when the pricing strategy has

been changed it was not right for quoting tenders. It was also necessary to find

whether there was acceptance for the product in the market. It was also necessary to

find whether repeat purchase was there or not Customer might be buying it due to

companys goodwill but after one purchase was there a repeat purchase or not ? It

was also necessary to find out the competitors strength and how it was affecting the

sales of I.T.I.

OBJECTIVE

The research objective was to find a solution for the above problem. I.T.I. being a

pioneer in the telecom business and being the boss would like to hold the same

position. It therefore wanted to get an in depth view of the above stated problem.

Hence the objectives were:-

To get knowledge about the present marketing & pricing structure of ITI.

To bring about the marketing positioning of the ITI products with regards to

the marketing & pricing factors.

To bring forth the degree of brand awareness amongst the customers.

To get acquired with the relatively preferred brand & the reason behind their

success of being preferred.

56


57/86

STEP:2

REVIEW THE LETRATURE

57


58/86

DEVELOPING THE RESEARCH PLAN

The second step of marketing step of the marketing research process calls for

determining the information needed, developing the plan for gathering it efficiency,

and presenting the plan to marketing management. The plan outlines sources of

existing data and spells out the specific research approaches, sampling plans and

instruments that researchers will use to gather new data. The information required in

detail regarding the project was collected and and analyzed, but the step taken before

collecting this information was to decide actually what information was required. Ilance am proper analysis was made to decide what information was needed. The

information required was as follows:-

Pricing Strategy

What is the current pricing strategy?

Was there any other pricing strategy earlier?

When was it changed?

Is there any problem with the current pricing strategy?

Was this pricing strategy adopted?

Has this pricing strategy been effective?

58


59/86

STEP: 3

RESEARCH DESIGN (INCLUDING SAMPLE DESIGN)

59


60/86

RESEARCH DESIGN

Research design is a preplanning of research in which

manner the research should be conducted it is a type of blue-print as in the case of

building construction or we say it is a frame according of which we for research.

Research plan or Design is formulated keeping in view the problem which is

to be analyzed.

A Research Design may be explanatory, descriptive or an experiential in

nature. As per convenience i have adopted descriptive method of Research

Design.

Problem Definition

Downfall in demand of ITIs telephones in the market

Deterioration in market share of ITI

Expansion of competitors network

Project under study

Telephone instruments

Exchange equipments

Market segment under study

BSNL

NON-BSNL

SAMPLING PLANA sample is a segment of population selected to population as a whole. Ideally the

sample should be representative so that the researcher can make accurate estimates of

the thoughts and behaviors of the larger population. Designing the sample requires

three decisions. First, who is to be surveyed? Second, how many people should be

surveyed? Third, how should people in the sample should be chosen?

Regarding my research process the sample selected includes the telephone exchanges,

BSNL and railways of Allahabad.

60


61/86

Sample technique

Area sampling

Area sampling is one in which research involves populations that can be grouped byidentifiable geographic areas like blocks, housing tracts, communities. Then it is

possible to use a version of cluster sampling known as area sampling.

Since the sample in my research was limited and small, I divided the samples into

areas of Allahabad.

Sample size and population size : The sample size selected by me was 55.

REASONS FOR SELECTING THIS SAMPLING TECHNIQUE

AND SAMPLE SIZE

The reasons for selecting the sample size are -:

The customers profile of ITI is small, as there are bulk purchasers of ITI

transmission equipment. They place big orders through tenders.

The sample was large enough to represent the whole population.

The sample was large enough to derive the information needed to reach to a

particular conclusion.

The reasons for selecting the following sample techniques are

The area has sufficient samples to obtain information.

The area contains the most important customers of ITI.

The area was easy to cover.

The area contained customers who could give the right information, as they

had been associated with ITI for a long time.

The area has samples that could give unbiased view.

61


62/86

STEP:4

COLLECTION OF DATA OR SOURCES OF INFORMATION

62


63/86

COLLECTION OF DATA OR SOURCES OF INFORMATION

After deciding what information is required the

next step is to decide which the various sources of obtaining are. There are various

sources from where this information could be collected or gathered. Choosing the

right source for collecting data is of prime importance.

PLANNING PRIMARY DATA COLLECTION

In case of collecting the primary data use of questionnaire was thought to be effective

and hence the first step was to design a questionnaire. The questionnaire contains all

the relevant questions covering the information needed. The questionnaires were

given to the respondents to get filled. Personal interviews were conducted and

personal observation was made to see the buying habits of the customers. Designing a

plan for primary data for primary collection calls for a number of decisions on

research approaches, contact methods, sampling plan and research instruments.

RESEARCH APPROACHES

Observational Research is gathering of primary data by observing people, actions and

situations. Consumer packaged-goods marketers might visit supermarkets and

observe shoppers as they browse the store, pick up products and examine packages

and make actual buying decisions. Some marketing research firms now offer single-

source data systems that electronically monitor both consumers purchases and

consumers exposure to various marketing activities in an effort to better evaluate the

link between the two.

Survey research is the approach best suited for gathering the

descriptive information. To get knowledge about the peoples attitudes, preferences or

buying behavior can be found out easily by asking individually directly. Survey

research is most widely used method for primary data collection and is often the only

method used in a research study. The main advantage of the survey research is its

63


64/86

flexibility. It can be used to obtain different kinds of information in many different

situations. Depending on the survey design, it may also provide information more

quickly at lower costs than observational or experimental research

CONTACT METHODS

Information can be collected by mail, telephone,

personal interview or online. Mail questionnaires can be used to collect large amounts

of information at a low cost per respondent. Respondents may give honest answers to

more personal questions on a mail questionnaire than to an unknown interviewer, in

person or over the phone. However, mail questionnaires are not flexible. They usually

take longer to complete and the response rate is often low.

Telephone interviewing is one of the

best methods for gathering information quickly and it provides greater flexibility than

mail questionnaires. However, with telephone interviewing the cost per respondent is

very high. Also, people may not want to discuss personal questions with an

interviewer.

Personal interviewing takes two forms: individual and group

interviewing. Individual interviewing involves talking with people in their homes or

offices, on the street or in shopping malls. Group interviewing involves talking with

people for a few hours with a trained moderator to talk about a product, service or

organization.

RESEARCH INSTRUMENTS

In collecting primary data, marketing researchers have a choice of two research

instruments the questionnaires and the mechanical devices. The questionnaire is by

far the most common instrument, whether administered in person by phone or online.

Questionnaires are very flexible. The form of each question can influence the

response.

In my research process I made use of the questionnaires. The questions

chosen were simple and to the point covering the relevant points and also keeping in

mind the purpose of the project. It covers all the aspects of the project and contains

questions about customer expectations, the product features, competitors knowledge

64


65/86

and the views of the customers regarding what they are looking for in the equipment

in the long run.

REASONS FOR CHOOSING THE QUESTIONNARES AS THE

RESEARCH INSTRUMENT

It gives respondent a clear comprehension of the questions.

It includes the respondent to want to cooperate and trust that the answers will

be kept confidential.

Stimulates responses through greater introspection, plumbing of memory orreference to records.

It gives instructions on what is wanted and the manner of responding.

GATHERING SECONDARY INFORMATION

Secondary data consists of information that already exists somewhere, having been

collected for another purpose. Researches usually start by gathering secondary data.

the Companys internal database provides a good starting point. The significance of

the secondary data can hardly be understood.

In my research process the secondary data played a major role as the customer are

less but place orders through tenders which are in bulk. I used sources like Company

Profile and Annual Report of ITI.

65


66/86

OVERVIEW OF RESEARCH PROCESS:-

Research type :- Descriptive research

Research Design :- Descriptive research design

Sample size :- 55

Population size :- 2000Primary data :- Questionnaire and Unstructured

Interview with Employees and

staff

Secondary Data :- Annual report and company profile

Analysis style :- Graphs

Reporting style :- Interpretation, finings, suggestion,limitation of project , conclusion.

66


67/86

STEP: 5

DATA ANALYSIS

67


68/86

Ques:1:-What was the Awareness of the transmission

equipment manufacturers in their customermind

CHART:1

Awareness of Equipments

0

5

10

15

20

25

30

35

ITI BEL MAC FIBCOM HFCL OTHERS

No .of responses

% of responses

COMPANY NAMES

68

COMPANY NUMBER OF RESPONSES % OF RESPONSES

ITI 17 30.9%

BEL 11 20%

MAC 10 18.1%FIBCOM 8 14.5%

HFCL 5 9.09%

OTHERS 4 7.2%

No

of

resp-

onses

& its%


69/86

Ques:2 Which equipments required most by the customers ?

EQUIPMENTS NUMBER OF RESPONSES % OF RESPONSES

RADIO EQUIPMENT 15 27.2%

OPTICAL FIBERS 12 21.8%

DIGITAL MUX EQUIPMENT 8 14.5%

OPEN WIRE SYSTEM 10 18.1%

MULTIPLEXING

EQUIPMENT FDM

6 10.9%

NO RESPONSE 4 7.2%

CHART :2

Demand of Equipments

69

Company names

No

Ofrespo-

nses

&

Its %


70/86

COMPANY EQUIPMENTS

Ques:-3 What was the reasons for not buying ITIs

equipment?

ATTRIBUTES NUMBER OF RESPONSES %OF RESPONSES

DELAY IN FULFILLING ORDERS 35 63.6

COMPARATIVELY MORE DEFECTS 14 25.4

LACK OF PROMOTIONAL

DISCOUNTS

6 10.9

CHART:3

REASON FOR NOT BUYING EQUIPMENT

0

10

20

30

40

50

60

70

Delay in fullfillinf orders Comparatively more

defects

Lack of Promotional

discounts

No of responses

% of its responses

ATTRIBUTES OF PRODUCT

70

No of

respo-

nses

& its

%


71/86

Ques :4 Which features/ attributes desired in the

transmission equipment?

CHART:-4

FEATURES DESIRED IN TRANSMISSION EQUIPMENTS

ATTRIBUTES OF PRODUCT

71

ATTRIBUTES NUMBER OF RESPONSES % OF RESPONSES

LOWER PRICES 13 23.6%

AFTER SALES SERVICE 11 20%

MAINTENANCE COST 10 18.1%

QUALITY 7 12.7%

COMPANYS REPUTATION 6 10.9%

OVERALL PRODUCT 4 7.2%

OTHER (GUARANTEE PERIOD) 4 7.2%

No

of

resp

onses

& its%


72/86

Ques: 5. Rating the companies with the equipment being

manufactured by them according to satisfaction of the

attributes / features found in them ?

(i) 2/34 OPTIMUX

ATTRIBUTES MAC

RESPONSES

% HFCL

RESPONSES

% ITI

RESPONSES

%

EASE OF USE 10 18.1

%

15 27.2

%

16 29.09%

EASY

DETACHABILITY

8 14.5

%

10 18.1

%

11 20%

LONG PHYSICAL

LIFE

7 12.7

%

8 14.5

%

5 9.09%

COMPARATIVELY

MORE DEFECTS

6 10.9

%

6 10.9

%

10 18.1%

AFTER SALES

SERVICE

5 9.09

%

0 0% 5 9.09%

MAINTENANCE COST 7 12.7

%

6 10.9

%

0 0%

COMPANYs

REPUTATION

6 10.9

%

7 12.7

%

11 20%

PRICE ECONOMY 4 7.2% 3 5.4% 6 10.90%

CHART: 5(A)

72


73/86

RATING THE COMPANIES

WITH EQUIPMENT FEATURES

ATTRIBUTES OF PRODUCT(A)

73

No

of

res

po

nse

s &

its%


74/86

(ii) STM 1

ATTRIBUTES FIBCOM RESPONSE % ITI RESPONSE %

EASE OF USE 15 27.2% 13 23.63%

EASY DETACHABILITY 9 16.3% 11 20%

LONG PHYSICAL LIFE 5 9.09% 4 7.27%

COMPARATIVELY MORE

DEFECTS

4 7.27% 8 14.5%

AFTER SALES SERVICE 5 9.09% 6 10.9%

MAINTENENCE COST 4 7.27% 4 7.27%

COMPANYs REPUTATION 6 10.9% 5 9.09%

PRICE ECONOMY 7 12.7% 4 7.27%

CHART:5(B)

74


75/86

RATING THE COMPANIES

WITH EQUIPMENT FEATURES

ATTRIBUTES OF EQUIPMENTS

75

No of

resp

onses

& its

%


76/86

STEP : 6

INTERPRETATION AND FINDING

INTERPRETATION AND FINDING

76


77/86

The next step after arranging the data is to interpret the findings and arrange them

according to priority. The market survey has been done, and now it is necessary to

interpret the findings so to impart a much better understanding

Interpretation is an

important phase of the marketing process. Form the interpretation of the findings of

my research it can be easily said the pricing policy is not a problem for ITI.

THE FINDINGS ARE AS FOLLOWS -:

ITI products are preferred due to lower prices.

After sales service is excellent.

Maintenance cost is also very low as compared to its competitors.

Latest technology proves to be a boon for the company.

Sales are lost due to its inability to supply the products on time.

Competition has also come up with latest technology.

Products of ITI are easy to handle and are easily detachable.

The research was to find out why loss was being incurred, when the sales were rising.

In my research I found that the equipment being manufactured by I.T.I. satisfied

people and its quality is good. So why there was a loss?

The interpretation is as follows:-

The awareness of the I.T.I. equipments was 30.9% as compared to BEL (20%), HFCL

(9.09%), MAC (18.1%), FIBCOM (14.5%) and others (7.2%). The equipment of

I.T.I. in demand required mostly by the customers are 27.2% radio equipments,

21.8% optical fibers, 14.5% digital MUX equipments, 18.1% open wire equipments

and 10.9% Multiplexing equipment FDM.

77


78/86

Those who did not choose I.T.I. equipments were 63.6% due to delay in supplying

orders on time, 25.4% due to having comparatively more defects and 10.9 due to lack

of promotional benefit

The features/ attributes that the customers are looking for in the equipment are :-

20% said low price

9.09% good sales service

18.1% low maintenance cost.

29.02% good quality of product.

11.8% for technical collaborations

20% for company reputation.

5.9% said overall product should be good.

The price economy is 7.2% for MAC, 5.4% for HFCL and 10.9% for I.T.I.

In case of STM-1 it gets tough competition from FIBCOM. For item 2/140 Mb .

LIMITATIONS

78


79/86

Though utmost care was taken so that aspects of the problem remained untouched but

still there were certain constraints that could not be overlooked.

The following were the main constraints in my project.

1:-The paucity of time restricted the field of survey.

2:-The topic of the project was very delicate hence people were afraid to give their

views openly.

3:-The secondary data was not very auto date.

4:-The sample unit was not very sufficient.

5:-Some of the respondents were not available.

6:-Personals biases and perceptions of the respondent may have stopped him from

giving the right information.

7:- The respondent may not have understood the actual implication of the question.

RECOMMENDATIONS

79


80/86

Strategy of marketing mix modification

1. PRODUCT -:

New products those are in demands in the market should be identified.

Durability of the product should be enhanced. Some of the existing products

should be innovated.

2. PRICE -:

ITI should try to reduce the prices of its products for attracting new

customers and to win over competitors customer. This can be done by reducing

the manufacturing costs and the overhead expenses. Also, the company can

encourage discount and credit facility.

3. PROMOTION -:

Perhaps, it may be the key of ITIs survival in the present market. ITI

should encourage and adopt new sales promotion schemes. These schemes can be

fruitful in enhancing the sales volume, trade rebate, discounts guarantee etc. are

tools of promotion.

4. PUBLICITY -:

It holds the key factor for the success of any business in the present

scenario of competition. ITI can review its old glory by adopting appropriate

advertisement and publicity channel.

ITI should adopt consumer oriented marketing schemes. ITI should try to establish

direct contacts with the people to generate awareness of products to know their

requirement.

Strategies for other modification -:

1. Research and development should be encouraged.

2. Warrant should be replaced by replacement guarantee.

3. Marketing professionals should be recruited so that high-tech marketing

environment is generated due to widening of marketing concepts and technical

ideas.

80


81/86

4. More professional approach need to be adopted in dealing with the

competitors.

Others -:

1. There should be proper motivation to employees for better performance.

2. The induction of proper training to employees for effective operation.

3. The company should establish a well-organized marketing information system

to have a view of customers opinion.

4. Establishment of marketing research team.

5. Essential measures should be taken up to cut down the expenditure.

6. Management should pay more attention for the upgradation of technology to

meet the global standard.

CONCLUSION

1. ITI has a clear monopoly in terms of telephone equipment supply to BSNL

and has majority in case of equipments supplied to BSNL.

81


82/86

2. For instruments supplied to BSNL, ITIs share is 30%.

3. ITI highly depends on BSNL for orders they do not pay attention towards

advertising and publicity.

4. Approximately 70% of its ultimate consumers are satisfied from ITIs

equipment.

5. High overhead expenses have resulted in high price of ITIs products.

6. ITIs competitors have switched to replacement guarantee.

During my research, I came to know that the management of ITI has changed its

strategy recently and has set some new objectives which are as -:

1. Generation of demand through innovation.

2. Supply of finished product within stipulated time.

3. Go through mini tie-up with MNCs or technically advanced companies for

new range of products.

4. Strengthening technology scanning capability to benchmark the product

against global standards.

82


83/86

CHAPTER: 5APPENDIX

QUESTIONNAIRE

83


84/86

I say thanks for agreeing to spare 5 minutes of your time for filling up this

questionnaire.

NAME:-

NAME OF THE ORGANIZATION: - ......................................................

ADDRESS: - ......................................................

PHONE NO. :- ......................................................

1. What is the main business activity that takes place in this establishment?

2. Could you please tell which company comes first to your mind when we ask

about Transmission Equipment Manufacturers?

3. Could you please name two or more companies?

4. Have you ever used products being manufactured by ITI? (YES/NO)

5. If YES then what are the products what are the products of ITI which are

being used by you?

6. What are the reasons for choosing this equipment?

7. If NO, what are the probable reasons for not buying ITIs equipment?

8. While buying the Transmission equipment did you consider any other

equipment of any other company?

9. Do you really think that there is a difference between quality and technology

provided by ITI and that of other companies?

10. Do the ITI products need frequent after sales service?

11. Do you get the delivery of products on time?

12. What features / attributes are you looking for in the transmission equipment

when you purchased it? (Rate 1 to 8)

Price

Overall product

84


85/86

Quality

Company reputation

Guarantee period

After sales service

Maintenance cost

Tie up

BIBLIOGRAPHY

85


86/86

Kotler Philip, Marketing Management, Analysis, Planning, Implementation

and Control, tenth edition, 2000 Prentice Hall India.

Dilele, Simken, Pride, Ferrel Concepts and strategies, second European

edition.

ITI unaudited annual report.

Institution reference books.

ITI website.

www.itiltd.org

monika project

Documents