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TRANSCRIPT
ISSN - 0975-4032
Volume II
Issue II
July - December, 2010
Bhagyalakshmi Venkatesh Overall Service Evaluation by Customers: A Comparative Study of
Suresh Ghai Private, Public, Foreign and Co-operative Banks in India
Prateek Sharma Impact of Knowledge Management on
Babita Agarwal Organizational Performance
Monika Maheshwari
R.K. Uppal Second Banking Sector Reforms and Comparative Efficiency of
Banks in India:Emerging Issues and Challenges
Shyam Sunder Library Service Quality in Select University Libraries of Hyderabad:
A libqual+tm approach
Meena Dorathi Psychosomatic Correlates of Stress: An Empirical Analysis
Sitansu Kumar Panda Emerging Scenario of Industrial Relations in Orissa
Shamira Malekar Determinants of Workmen Engagement:
Kanchi Patel A Study in Some Medium Scale Pharmaceuticals
U. Deviprasad Case Study: Treatwell Hospital: Annoying events
Book Reviews
R.M. Naidu Our Iceberg is Melting
Shahaida P Business Stripped Bare
Chief Patron : Mrs. Aarathy SampathyPresident and CEOSiva Sivani Group of Institutions, Secunderabad.
Patron : Mr. Sailesh SampathyVice President and Deputy CEOSiva Sivani Group of Institutions, Secunderabad.
Editor : Dr. V. G. ChariDirector - Academic, 1st Shift SSIMSiva Sivani Institute of Management.
Assistant Editor : Dr. Shahaida PAssoc. Professor, Marketing AreaSiva Sivani Institute of Management.
Editorial Advisory and Review Panel
Dr. Ashish Sadh, Professor, Marketing area, IIM Indore
Dr. B. Brahmaiah, Vice President, Industrial Relations, Sujana Group of Industries. Hyderabad
Dr. Cullen Habel, Lecturer in Marketing, The University of Adelaide Business School, South Australia
Dr. D. Dhanapal, CEO, KPR Educational Institutions, Coimbatore
Dr. C. Gopalkrishnan, Director In charge and Professor of Strategic Management, Institute ofManagement, Nirma University of Science and Technology, AhmedabadDr. H.K. Jayavelu, Professor- HR, IIM K
Dr. S. Hanuman Kennedy, Professor - HR, PESIT, Bangalore
Dr. Prashanth N Bharadwaj, Dean’s Associate and Professor, Indiana University of Pennsylvania,USADr. B. S. R. Rao, International Institute of Insurance and Finance, Hyderabad
Dr. B. Rajashekar, Reader, School of Management Studies, University of Hyderabad,
Dr. Rajendra Nargundkar, Director, IMT Nagpur, Nagpur
Dr. Srinivas Murthy, Professor - Finance, IPE, Hyderabad
Dr. G.B. Reddy, Associate Professor, Department of law, Osmania University, Hyderabad
Dr. Nilanjan Sen Gupta, Professor, SDM-IMD, Mysore
Dr. S.M. Vijaykumar, Professor - OB and HRM, Chairperson - Research and Ph.D. IMT Nagpur
Dr. Yerram Raju. B, Regional Director, PRMIA, Hyderabad
Prof. V. Venkaiah, Professor and Head, Department of Business Management, Dr. B. R. Ambedkar
Open University
Prof. M. Kamalakar, Operations and IT Area, SSIM
Dr. V. G. Chari, Director- Academics (1st Shift), SSIM
Dr. P.V. S. Sai, Director, Training and Consultancy, SSIM
Dr. S. F. Chandrashekar, Head-HR, SSIM
Dr. Anil Ramesh, Director - Academics (2nd Shift) SSIM
Contents
Overall Service Evaluation by Customers: A Comparative Study of 5Private, Public, Foreign and Co-operative Banks in India
Bhagyalakshmi Venkatesh and Suresh Ghai
Impact of Knowledge Management on Organizational Performance 18Prateek Sharma, Babita Agarwal and Monika Maheshwari
Second Banking Sector Reforms and Comparative Efficiency of Banks in India: 27Emerging Issues and Challenges
R.K. Uppal
Library Service Quality in Select University Libraries of Hyderabad: 39A libqual+tm approach
Shyam Sunder
Psychosomatic Correlates of Stress: An Empirical Analysis 50Meena Dorathi
Emerging Scenario of Industrial Relations in Orissa 58Sitansu Kumar Panda
Determinants of Workmen Engagement: 73A Study in Some Medium Scale Pharmaceuticals
Shamira Malekar and Kanchi Patel
Case Study:
Treatwell Hospital: Annoying events 88U. Deviprasad
Book Reviews:
Our Iceberg is Melting 93R.M. Naidu
Business Stripped Bare 95Shahaida P
Copyright: Siva Sivani Institute of Management, Secunderabad, India.SuGyaan is a bi-annual publication of the Siva Sivani Institute of Management,NH-7, Kompally, Secunderabad- 500 014.All efforts are made to ensure correctness of the published information. However, Siva SivaniInstitute of management is not responsible for any errors caused due to oversight or otherwise.The views expressed in this publication are purely personal judgments of the authors and donot reflect the views of Siva Sivani Institute of Management. All efforts are made to ensurethat published information is free from copyright violations. However, authors are personallyresponsible for any copyright violation.
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Editorial...
It is with great satisfaction that we present to you the second issue of SuGyaan in
2010. In its second year of existence SuGyaan has received a tremendous response.
Our sincere gratitude to the authors and reviewers for their support.
The first paper titled “Overall Service Evaluation by Customers: A Comparative Study
of Private, Public, Foreign and Co-operative Banks in India” by Bhagyalakshmi
Venkatesh and Suresh Ghai measures the factors that customers look for in evaluating
the services of banks in India.
The second paper, “Impact of Knowledge Management on Organizational
Performance” by Prateek Sharma and Babita Agarwal and Monika Maheshwari,
have measured ceratin factors which affect knowledge management in organizations.
The third paper, “Second Banking Sector Reforms and Comparative Efficiency of
Banks in India-Emerging Issues and Challenges” by R.K. Uppal is an extensive research
on the reforms and their impact on Indian Banks.
The fourth research paper, “Library Service Quality in Select University Libraries of
Hyderabad: A Libqual+tm Approach” by Shyam Sunder measures the quality of
libraries.
The fifth paper “Psychosomatic Correlates of Stress: An Empirical Analysis” by Meena
Dorathi explores the issue of stress faced by school teachers.
The sixth paper focuses on “Emerging Scenario of Industrial Relations in Orissa” by
Sitansu Kumar Panda deals with the problems of industrial relations.
Next we have a Case Study in Services Marketing titled “Treatwell Hospital: Annoying
Events” by U. Devi Prasad, Lastly, we have two book reviews of the books, Our
Iceberg is Melting by R.M. Naidu and Business Stripped Bare by Shahaida P.
We hope you find this issue interesting and look forward to your feedback.
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Overall Service Evaluation by Customers: A ComparativeStudy of Private, Public, Foreign and Co-operative Banks in
India
Bhagyalakshmi Venkatesh and Suresh Ghai
Abstract
Banking industry in India consists of public sector, private sector, co-operative and foreign banks.Post liberalization of the Indian economy in 1991, foreign banks have brought modern technologyand customer orientation to the Indian banking industry. Private banks such as ICICI bank, HDFCbank, Axis bank etc also grew at a faster pace after liberalization. The private banks and foreignbanks focused on service quality in delivering banking services. The traditional bankers such aspublic sector banks and co-operative banks woke up to service quality elements such as physicalfeatures of the branches, employee service, technology based banking services and brand buildingactivities through integrated marketing communications etc., after these services were launched bythe foreign and private players.
This study aimed to understand how Indian customers perceive these four types of banks. The studymeasured these four different types of banks on various parameters to assess overall evaluation ofbanking services. The different dimensions for overall evaluation of services were pooled fromliterature. Respondents of the study were the residents of Mumbai, a cosmopolitan city in India. Oneway Anova was used to test the hypothesis that the four different samples were considered dissimilarby customers. The test proved that the banks were perceived dissimilar on sixteen different variablesacross the four groups, leading to the rejection of null hypothesis. The variables were identified andlabeled as performance features and emotional connectors. The study also identified major driversfor customers in the choice of their banks. The major drivers were convenient location, reputation ofthe bank and modern banking facilities.
Introduction
India has four different types of banksoperating in the country. Public sectorbanks, private banks, foreign banks andco-operative banks. Before the bankingsector got de-regulated, public sectorbanks and co-operative banks were theonly players in the banking sector.Liberalization brought private andforeign players to the country. Foreignbanks have brought modern bankingpractices to the Indian banking scene postliberalization in 1991. Private Banks suchas ICICI and HDFC bank have witnessedsteep growth in a very short span. Thesenew age banks were quick in introducing
ATM’s and net banking for theconvenience of customers. Public sectorbanks were focused on branch bankingthough they slowly introduced ATM’sand net banking as they were becomingpopular among customers. Banks alsostarted brand building activities andstarted huge advertising campaignswhich were new to the Indian bankingindustry which almost operated likecommodity business before. Aftercompleting almost two decades afterliberalization, Indian banking industryhas reached an interesting phase at thispoint in time. The banks offer a series ofservices from savings accounts, to credit/
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debit cards, investment advices, netbanking, mobile banking, ATMs(Automated Teller Machine) etc., Bankshave also started focusing on improvingthe service quality by offering betteremployee service, creating appealingphysical features inside the banks andspeedy services. Banks are investing inadvertizing and other integratedmarketing communications to create apositive brand image in the minds of thecustomer.
This study has generated a pool of itemsfrom literature on different servicequality dimensions. Different banksfrom the four banking sectors such asprivate, public, foreign and co-operativebanks were measured on these items bycustomers of the respective banks toidentify whether they rate all the serviceparameters similarly or not. The studyalso throws light on how customers ratethe banks of their choice on these servicequality dimensions allowing acomparison among them.
Literature Review
Churchil et al (1982) defined customersatisfaction as an attitude which isassessed by the sum of the satisfactionstowards the various attributes of theproduct or service. Parasuraman et aldeveloped a conceptual model of servicequality. This conceptual model was thebasis for developing SERVQUAL in 1988which is a multi item scale for measuringconsumer perception of service quality.Cronin and Taylor (1994) reexamined thescale developed by Parasuraman et al anddeveloped another scale calledSERVPERF. This scale is also a very goodmeasure of service quality. The
servicescape has been found to affect bothsatisfaction and service quality in variousservice settings (Chang, 2000). The coreservice, employee service and feelingsaroused during service consumption arealso argued to have a direct effect onsatisfaction (Babin and Babin, 1999). Inaddition, brand dimensions such as priceand core service (components of brandevidence) affect consumer’s perception ofservice quality (Berry, 2000; Danaher andMattson, 1998), which is closely relatedto satisfaction. For example, many havenoted the importance of brand names inconsumer evaluations of brands as theyassist the consumer in recalling brandbenefits (Janiszewski and Van Osselaer,2000; Keller, 1998) and making productinferences and evaluations (Zinkhan andMartin Jr., 1987). In addition, Keller(1998) argues that the personality andbehavioural traits of both the product/service brand and the consumer arereflected through the user’s image, theusage situation and the brand’spersonality.
Grace and O’Cass (2005) developed andtested their model named as SBV modelon consumer verdict on services brandson dimensions such as core service,employee service, brand name,servicescape, and price/value for money,self-image congruence and feelings. Thisstudy primarily featured retail settingsand banking services. The study provedthat brand evidence which is comprisedof brand name, price, servicescape, coreservice, employee service, self imagecongruence and feeling influencecustomer satisfaction and brand attitude.Brand attitude was defined by Grace andO’Cass (2005) as the consumer’s overall
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positive or negative disposition towardthe service brand, the brand attituderesults from the consumer’s perceptionsof and satisfaction with their experiencewith the service brand dimensions. Themodel also proved the relationshipbetween brand hearsay (controlled(advertising, PR etc) and uncontrolledcommunications (word of mouthpublicity) and brand attitude andcustomer satisfaction. In Grace andO’Cass’s (2005) study the perceptualmeasures were based on employee serviceand servicescape (Cronin Jr. and Taylor,1992), price/value for money (Sweeneyand Soutar, 2001), self-image congruence(Sirgy et al., 1997), feelings (Jayanti,1995), controlled communications(Holbrook and Batra, 1987), uncontrolledcommunications (Bansal and Voyer,2000), brand attitude (Yoo and Donthu,2001), and satisfaction (Caruana et al.,2000). Ndubisi (2006) studied therelationship between overall satisfactionand relationship quality in the Malaysianbanking sector. In his study, theindicators of customer satisfaction weretrust, commitment, communication,service quality, service satisfaction andconflict handling.
Research Objectives
1. To understand whether there isany significant difference amongthe overall evaluations of private,public, co-operative and foreignbanks.
2. To identify the major drivers forcustomers in selecting a bank
Hypothesis
Ho: The four samples of private, public,
co-operative and foreign bank customers’overall evaluation of banking services aresimilar.
H1: The four samples of private, public,co-operative and foreign bank customers’overall evaluation of banking services aredifferent.
Research Methodology
Sample
The respondents comprised of customersof public, private, foreign and co-operativebanks. The targeted sample was 250.However some incomplete question-naires had to be rejected because ofincomplete data leaving the final samplesize to 192. 59 respondents werecustomers of private banks, 87 werecustomers of public sector banks, 29 werecustomers of foreign bank and 17 werecustomers of co-operative banks.Convenient sampling was done. Thequestionnaires were distributed torespondents only after ensuring that theymaintain an account with at least onebank and use the banking servicesregularly.
Questionnaire Development
While comparing the scales developed byParasuraman etal (1988), Grace andO’Cass (2005) and Nbudisi (2006) whichmeasures service quality, service brandverdict and overall satisfaction in servicesthe authors found that many dimensionsare overlapping because of the mere factthat all the constructs whether servicequality, customer satisfaction or overallsatisfaction were all part of the servicesdomain. Hence authors created a pool ofitems from these different scales based onface validity to measure the perceptions
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of customers on service quality, customersatisfaction and brand image of the banks.
The customers were asked to respond tostatements on a Likert scale of 1 to 7 were1 meant strongly disagree and 7 meantstrongly agree. 55 statements were listedon dimensions such as brand salience,price/value for money, employee service,feelings, facilities, customer satisfaction,reliability, trustworthiness, convenience,modern banking practices, customersatisfaction and brand resonance.
The questionnaire had another sectionwhere customers had to select the mostimportant three reasons to select thebank. These questions were attempted inunderstanding the major drivers for acustomer in selecting a particular bankfor his/her banking services needs.Respondents were asked to choose amongconvenient location, My salary a/c is withthis bank, I chose this bank as I had heardthis bank offers very good qualityservices, the interest rates offered by thisbank are good, D-mat account, this bankis highly reputed, this bank offers modernbanking facilities, mobile banking,internet banking, tele-banking etc., thisbank offers good returns to seniorcitizens, this bank offers good returns toNRI customers, service charges arereasonable, I require to maintain lowquarterly account balance, this bankoffers good investment advice. Thesequestions could reveal what are the keydrivers for customers in deciding thechoice of their banks.
Data Analysis
Descriptive statistics: Demographicprofile of respondents
The data consisted of 192 customers of40 different banks. The following tablesummarizes that there were 59 privatebank customers, 87 public sector bankcustomers, 29 foreign bank customersand 17 co-operative bank customers. Thesample consisted of 132 males and 55females. 109 of the respondents were ofthe age group of 20-29, 21 were of theage group of 40-49 and the rest werealmost evenly distributed across the restof the age groups. 102 of the respondentswere post graduates, 29 of them holdprofessional qualifications, and 51 ofthem were graduates. 122 of them wereemployed and the rest were unemployed.67 of the respondents had an annualincome between 1-4 lakhs, 46 of them hadannual income between 4-8 lakhs, 16 ofthem had annual income upto 1 lakhs, 9of the had annual income of 9-15 lakhs,10 of the respondents had an annualincome of 16-50 lakhs and 9 of them hadan annual income of 51 lakhs and above.
Type of Banks vs. Number ofcustomers
Table 1
Frequency Percent
Private 59 30.7
Public sector 87 45.3
Foreign bank 29 15.1
Co-operative bank 17 8.9
Total 192 100.0
The table 2 indicates the details of thename of banks and number of customerswho participated in the survey
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Bank Names Vs FrequencyTable 2
Name of banks FrequencyICICI Bank 22HDFC 19Axis Bank 9HSBC 2Canara Bank 4State Bank of India 40Vijaya Bank 1Bank of Baroda 2Punjab National Bank 4Oriental Bank 1UCO Bank 1Andhra Bank 1Syndicate Bank 1Citi Bank 3Kotak Bank 1New India Co. bank 1Dena Bank 2Bank Of India 4Indian Bank 3Sarswat bank 2Deccan Mercantile 1State Bank of Indore 9State Bank of Bekaner and Jaipur 1State Bank of Patiala 1Allahabad Bank 2Union Bank 2Bank of Maharastra 1State Bank of Hyderabad 1UTI Bank 1Punjab & Maha. Bank 1Punjab & Sind Bank 2Central Bank of India 2Patan Co-op Bank 1IDBI 1standard chartered bank 28abhyudaya co p bank 13Total 190
Reasons for Customer Preference forthe Bank
Customers were given a list of 12 itemsso that they could select three top reasonsfor selecting the bank. This data providesus with details on what drives a customerin deciding the choice of their bank.(Table 3)
Most of the private bank customers chosethe services of their bank as their salaryaccount was with the bank, the bank hadconvenient location, and it enjoyed goodreputation and provided modern bankingfacilities. For most of the public sectorbank customers the three factors whichdecided the choice of their bank were theconvenient location, reputation andmodern banking facilities. Foreign bankcustomers came with top four reasonswhich were convenience, reputation,modern banking facilities and investmentadvice. Co-operative bank customerspreferred their service because of theconvenient location, good interest ratesoffered by the banks and reasonableservice charges.
Hypothesis Testing
The statistical test- One way Anova wasused to test the hypothesis. As thehypothesis testing required thecomparison of means of more than twosamples Anova was used. The Anovatable is given below. (Table 4)
Hypothesis
Ho: The four samples of private, public,co-operative and foreign bank customers‘overall evaluation of banking services aresimilar.
H1: The four samples of private, public,co-operative and foreign bank customers’
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Reasons for Customer Preference
Table 3
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ANOVA
Table 4
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overall evaluation of banking services aredifferent.
Null hypothesis is rejected because theF ratio of sixteen variables was found tobe significant at 95% confidence interval(significance value below .05). It can beinterpreted that these sixteen variablesaccount for the differentiation in theoverall service evaluation by customeracross these four different groups. Hencethe four groups are not similar across allthe variables and different across thesesixteen variables making the samplesdissimilar from each other.
Findings and recommendations
Convenient location seems to be a majorattraction for customers in deciding theirbank. Branch banking is still the favoriteof the customers. The western model ofencouraging internet and other form ofmodern banking such as mobile bankingand phone banking has not yetinfluenced Indian customers to stay awayfrom branch banking thought modernbanking facilities are very popular.Private Banks have attracted a lot ofcustomers through their corporate salaryaccounts. It is a good strategy which canbe emulated by public sector banks andothers too. The major drivers forcustomers in choosing the banks havebeen good service quality, good interestrates, reputation of the bank, modernbanking facilities, reasonable servicecharges and good investment advice forthe customers. These variables can beused to define the expectation of thecustomers from the bank which shouldnot be overlooked by banks as customersdeem these services to be very important.
The following variables were found to
be significantly different from eachother across the four samples.
1. This bank provides good servicesfor the prices they charge,
2. This bank’s physical facilities areattractive,
3. Opinion of my friends and familyis significant in affecting myview,
4. Made the right decision the usethis bank,
5. Have a good relationship with thebank,
6. Overall the bank has beenextremely likable,
7. Has up to date facilities,
8. Professionalism in its services,
9. Provides state of the art utilities,
10. Offers loan at competitive rates,
11. The bank is competitively priced,
12. The bank offers speedy service,
13. The bank achieves high return ontheir client’s investmentscompared to other banks in India,
14. This bank’s mobile banking isconvenient to me,
15. This bank’s phone banking isconvenient to me,
16. The ATM (Automated tellermachine) of this bank isconveniently located.
These variables can be labeled asperformance features and emotionalconnectors towards the bank which canbe looked upon as the differentiatingfactors for banks. Attractive physical
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facilities, up to date facilities, state of theart utilities, loan at competitive rates,competitive pricing/tariffs, mobilebanking, internet banking, andavailability of ATMs can be labeled asperformance features. Customers feelthat banks are different in the physicalambience they provide, their tariffs andmodern banking tools such as mobilebanking, internet banking and ATMavailability.
Customers’ feeling that the bank providesgood services for the prices they charge,their choice of bank is influenced by theopinion of their friends and family andtheir feeling that overall the bank hasbeen extremely likable can be labeled asthe emotional connectors. Thesevariables are in fact the response orinvolvement evoked by the banks throughtheir good brand image and satisfactoryservices which has acted as adifferentiating factor.
Hence banks need to concentrate on bothperformance features and creation ofemotional connect by invoking positivefeelings in the minds of customers.
Limitations of the study
The sample sizes of the four differentsamples are not comparable with theforeign banks and co-operative banksample sizes being smaller than the othertwo groups. This study was conducted inMumbai, one of the metros in India.Though the city is cosmopolitan innature, a pan India study may have to beconducted to conclude the findings of thestudy can be applied to the Indianpopulation as a whole.
Conclusion
This study has brought out the perceptiondissimilarity among bank customers inIndia towards private, public sector,foreign and co-operative banks in India.The study concluded that these banks areperceived differently by customers. Thestudy also brought out the major driversfor bank customers in the choice of theirbank. The variables which broughtdifferentiation among banks wereidentified and were labeled asperformance features and emotionalconnectors. The banks which score lowon these variables will have to focus onthese features to improve their points ofparity when considering competitivescenario.
References
1. Babin, B.J., Babin, L.A., (1999).Seeking Something Different? AModel of Schema Typicality,Consumer Affect, PurchaseIntentions and Perceived ShoppingValue. Journal of Business Research54, pp 89–96.
2. Bansal, H.S., Voyer, P.A., (2000).Word-of-mouth Processes within aServices Purchase DecisionContext. Journal of ServiceResearch 3(2),pp 166-177
3. Berry, L.L., 2000. CultivatingService Brand Equity. Journal ofthe Academy of Marketing Science28 (1), pp 128–137.
4. Caruana, A., Money, A.H.,Berthon, P.R., (2000). ServiceQuality and Satisfaction—theModerating Role of Value.
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European Journal of Marketing 34,pp 1338–1352.
5. Danaher, P.J., Mattsson, J., (1998).A Comparison of Service DeliveryProcesses of Different Complexity.International Journal of ServiceIndustry Management 9 (1), pp 48–63.
6. Chang, K., (2000). The Impact ofPerceived Physical Environmentson Customers’ Satisfaction andReturn Intentions. Journal ofProfessional Services Marketing 21(2), pp 75–85.
7. Churchill, JR., and Surprenant,(1982). ‘An Investigation into theDeterminants of CustomerSatisfaction’, Journal of MarketingResearch, 19 (4), pp: 7-19.
8. Cronin and Taylor, (1992),‘Measuring Service Quality: A re-examination and Extension’.Journal of Marketing, 56 (2), pp 55-68.
9. Cronin and Taylor (1994).“SERVPERF vs. SERVQUAL:Reconciling Performance basedPerceptions Minus Expectations,Measurement of Service Quality’,Journal of Marketing, 58 (1), pp125-131.
10. Grace, Debra and Aron O’Cass(2005). Service Branding:Consumer Verdicts on ServiceBrands, Journal of Retailing andConsumer Services, pp 125–139.
11. Holbrook, M.B., Batra, R., (1987).Assessing the Role of Emotions asMediators of Consumer Responses
to Advertising. Journal ofConsumer Research 14, pp 404–420.
12. Janiszewski, C., Van Osselaer,S.M.J., (2000). A ConnectionistModel of Brand-QualityAssociations. Journal of MarketingResearch XXXVII, pp 331–350.
13. Jayanti, R., (1995). The Impact ofAffective Responses on PhysicianEvaluations: an Exploratory Study.Health Marketing Quarterly 12 (3),pp 49–62.
14. Keller, K.L., (1998). Strategic BrandManagement. Prentice Hall, NewJersey.
15. Ndubisi, Nelson Oly ((2006). AStructural Equation Modeling ofthe Antecedents of RelationshipQuality in the Malaysian BankingSector’ Journal of FinancialServices Marketing 11, pp 131 –141.
16. Parasuraman et al (1988).SERVQUAL: A Multi Role ItemScale for Measuring CustomerPerceptions of Service Quality’,Journal of Retailing, 64(1) pp 12-37.
17. Sirgy, M.J., Grewal, D.,Mangleburg, T.F., Park, J., Chon,K., Claiborne, C.B., Johar, J.S.,Berkman, H., (1997). Assessing thePredictive Validity of two Methodsof Measuring Self-imageCongruence. Journal of theAcademy of Marketing Science 25(3), pp 229–241.
18. Sweeney, J.C., Soutar, G.N., (2001).
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Consumer Perceived Value: TheDevelopment of a Multiple ItemScale. Journal of Retailing 77, pp203–220.
19. Yoo, B., Donthu, N., (2001).Developing and Validating Multi-Dimensional Consumer-BasedBrand Equity Scale. Journal ofBusiness Research 52 (1), pp 1–14.
20. Zinkhan, G.M., Martin Jr., C.R.,(1987). New Brand Names andInferential Beliefs: Some Insightson Naming New Products. Journal
of Business Research 15 (2), pp157–172.
Authors:
Bhagyalakshmi Venkatesh, Asst.Professor, K. J. Somaiya Institute ofManagement Studies & Research,Mumbai, [email protected]
Dr. Suresh Ghai, Director, K J SomaiyaInstitute of Management Studies &Research, Mumbai, [email protected].
#MJSSIM 2 (II) 01, 2010
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Introduction
According to the resource – based view(RBV), firms gain and sustaincompetitive advantage by deployingvaluable resources (Barney, 1991; Grant,1996). Undoubtedly, resourcesaccumulation is crucial in influencingbusiness success. However, thestraightforward application of RBV inpredicting firm success is too simplistic.In Knowledge economy, KM is animportant element along with the land,labor, and entrepreneurship. Knowledgemanagement capabilities (i.e., knowledgeacquisition, knowledge conversion, andknowledge application) are rooted in theoperation of a firm and are derived fromconfigurations of organizational structureand culture (Grant 1996; Moorman1995). Knowledge management (KM)and organizational performance are
essential for the success in business. Thedifferent results in literature declare thepositive effects of KM on organizationalperformance. In Darroch (2005) research,the results support some KM processpositively affects performance. AsTippins and Ravipreet (2003) havementioned the relationship between ITcompetency and firm performance ismediated by organizational learning.
The Knowledge – intensive sectors areselected because of having large amountof knowledge input, short product lifecycles, high demand for customizedproducts, and great quantity ofproduction value (Liao et al., 2007).Thus, the results of surveys involvingKnowledge – Intensive Firms of Indoreprovide rich data set of informationregarding KM behaviors in unstablebusiness environments. The resource and
Impact of Knowledge Management on OrganizationalPerformance
Prateek Sharma, Babita Agarwal and Monika Maheshwari
Abstract
Knowledge management (KM) and organizational performance are believed to be essential of thesuccess in business. The different results in literature declare Knowledge Management (KM) as thepositively affecting factor organizational performance. Information a major part of KM is becomingeven more important in our economy now, and most businesses that take knowledge can confercompetitive advantage. But most business has been flooded with information, and most of us havemore of it than we can handle. Knowledge management (KM) tries to resolve the troublesome paradoxfor us (Anthes, 1998). In Darroch (2005) research, the results support some KM process positivelyaffects performance. The knowledge – intensive sectors are selected because of having large amountof knowledge input, short product life cycles, high demand for customized products, and great quantityof production value (Liao et al. 2007). The survey involves Indore’s knowledge intensive firms whichprovide a rich data set of information regarding Knowledge Management behaviors in unstablebusiness environment. Most Companies claim, with effective and efficient KM process enhancesorganizational performance. Accordingly, KM is taken for granted as an important antecedent oforganization performance or innovation. The present study is based on a sample of Indore knowledgeintensive firms engaged in manufacturing sectors, data collected using a structured questionnaire.
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the knowledge based views of the firmhave prompted strategy researches tofocus on value creation, as opposed tovalue appropriation (Conner andPrahalad, 1996; Kogut and Zander, 1996;Nahapiet and Ghosal, 1998). Byhighlighting the important links ofknowledge management, trust andorganizational performance inmanufacturing firms, this research willcontribute a further convergencebetween the domains of knowledgemanagement and entrepreneurshipresearch. Knowledge lies in human mindsand exists only if there is a human mindto the knowing (Widen-Wulff andSuomi,2007). Knowledge can be createdby intentional and resource-consumingefforts (Du et al, 2007). The neglect oftacit Knowledge, based on people andideas, has undoubtedly reduced thecorporate market place’s capability fortrue innovation and sustainablecompetitiveness (Gamble and Blackwell,2001). According to Alavi and Leidner(2001), knowledge management is largelyregarded as a process involving variousactivities and a minimum of four basicprocesses must exist –creating, storing/retrieving, transferring and applyingknowledge. Knowledge management isabout managing the knowledge that anindividual possesses.
Review of Literature
Dimensions of Knowledge Manage-ment
In a commercial environment, knowledgemust be put to work in three primaryareas; customer needs, concernedprocesses and body of knowledge(Gamble and Blackwell, 2000). Every
member of an organization mustunderstand how his or her workcontributes to fulfilling customer needsand how the products and services of theenterprise provide the customer value.The members of the organization mustunderstand how his or her work relatesto the work of others. The last part ofthe process is the flow of the knowledgethat, to varying degrees, every personmust understand something about thesubject matter with which members ofthe organization deal. This requires adeeper knowledge of relationships andmeanings, both within the enterprise andthe outside world. Therefore a businessidea is considered successful when itdelivers value and profit. Knowledgemust be continuously flowing in theorganization. As long as there is stock ofknowledge, during any period of time, aflow of knowledge should take place(Stewart,2000). Making knowledgeavailable to others and capturing newknowledge has been described by Nonaka(1991) as the spiral of knowledge.Nonaka and Takeuchi (1995) examinethe concept in terms of a knowledge spiralencompassing four basic patterns ofinteraction between tacit and explicitknowledge: socialization, externalization,combination and internalization. Theflow of knowledge from an individual toanother resulted in collective effort incompleting their projects, enhancesorganizational performance. Thisknowledge spiral consists of knowledgeacquisition, conversion, application,storage, dissemination and protection.The manufacturing firms have twochallenges in managing their knowledge:the changing nature of knowledge and
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information services required by theirclients and information required tosatisfy their knowledge employees(Taylor et al, 2001). Knowledge intensivefirms that depend on knowledge capitalconsider knowledge management to beone of the core capability for achievingcompetitive advantage (Chard, 1997).
Gold, Malhotra, and Segars (2001)examine that the issue of effectiveknowledge management from theperspective of organizational capabilities.This perspective suggests that aknowledge infrastructure consisting oftechnology, structure, and culture alongwith a knowledge process architectureof acquisition, conversion, application,and protection are essential organiza-tional capabilities or ‘ precondi-tions’ foreffective knowledge manage-ment. Theresults provide a basis for understandingthe competitive predisposition of a firmas it enters a program of knowledgemanagement.
Trust and Organizational Perfor-mance
From a traditional perspective, organiza-tional performance is commonly referredto as financial performance whereconsiderations of budgets, assets,operations, products, services, marketsand human resources are crucial ininfluencing the over -all bottom-line ofan organization (Dixon, 1999; Thurbin,1994 ; Smith, 1999). As such, thefinancial benefits of organizationalperformance are often associated withorganizational success (Thurbin,1994).However, the notion of performanceembraces a far wider dimension ofinterpretations. With the focus on
organizational learning, the performanceoutcomes associated with it need to bemore carefully dealt with. Theimportance of performance measurementsystem is manifold, not only does itdemonstrate how an organization does,how well it does and how much progressit makes over time in archiving its goals,most importantly, it helps to manageorganizational change (Yeo, 2003).Hence, qualitative measures are moreappropriate in investigating these keyobjectives that dominate and directdecision – making and action – takinglevels (Thurbin 1994).
In Darroch (2005) research, she usescomparative and internally reflectiveperformance measures, for example“Compared with the industry average,our company is more profitable” andinternally reflective performancemeasures, for example, “We are moreprofitable than we were five years ago”.These performance measures captureboth financial and non- financialmeasures (e.g. market share and salesgrowth).
However, similar to any organizationalresource, effective knowledgemanagement through the development ofcapabilities should contribute to keyaspects of organizational performance(Andrew 2001). Also, when firmsdevelop greater knowledge managementcapabilities, they can more effectivelydevelop marketing offerings to meetcustomer needs (Hunt 1997). Withgreater knowledge managementcapabilities, firms can obtain and useknowledge more effectively andefficiently, which results in above-normalperformance.
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Levin and Cross (2004) discovered thattrust has a strong moderating effect in therelationship of tie strength andknowledge usage. Without trust, the tiestrength would be weak ties to knowledgeusage. Developing trust among employeesis crucial in ensuring organizationalknowledge development, which is crucialfor continuous innovation (Chowdhury,2005).
1. Trust must be visible. Themembers of the organization mustsee people get credit for knowledgesharing. There is a direct evidenceof trust.
2. Trust must be ubiquitous. Theinternal knowledge market must betrustworthy or else the market willbe less efficient.
3. Trustworthiness must start at thetop. Trust tends to flow downwardthrough organizations. Trust valuein the organization is identifiedthrough signals, signs and symbols.(Davenport and Prusak 1998).
Objectives of the Study
• To evaluate the effects ofKnowledge Management onorganizational performance.
• To determine the role of Trust infacilitating the KnowledgeManagement.
• To find out if KnowledgeManagement positively affectsorganizational performance.
• To explore the ability oforganization to acquire, converseand apply their knowledge.
• To create a competitive advantagethrough Knowledge Management.
Research Methodology
Hypothesis
H1: Knowledge management positivelyaffects organizational performance.
H2: Trust affects Knowledge ManagementPositively.
Method
The aim of this study is to evaluate theeffects of knowledge management onorganizational performance. Knowledgemanagement was measured using itemsfrom Gold et al (2003), Chang et al(2005), Darroch (2004) and Egbu et al(2005). Trust was measured using itemsfrom Yli- Renko et al (2001),Nahapietand Ghosal (1998) and Lee and Choi(2003). Organizational performance wasmeasured using items from Gold et al(2003) and Cameron and Quinn (1999).All items were measured on a seven pointLikert-type scale where 1 = stronglydisagree and 7 = strongly agree. Thesample was drawn from manufacturingfirms in Indore. A total of 200questionnaires were distributed. Only132 questionnaires were useableindicating a 66% response rate, which isconsidered an effective response rate.
Measures
We define knowledge management as theprocess of knowledge acquisition,knowledge conversion, and knowledgeapplication. Knowledge acquisition isdefined as the process to seek and acquirenew knowledge, or create new knowledgeout of existing knowledge throughcollaboration between individuals and
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business partners. Knowledge conversionis defined as the ability to makeknowledge useful. Knowledge applicationis defined as the process oriented towardthe use of knowledge. We adapted thescale for knowledge management fromGold, Malhotra, and Segars (2001)
Result and Discussion
Table 1
Correlation of Knowledge Managementdimensions and Organizationalperformance.
OrganizationalPerformance
Pearson KnowledgeCorrelation Conversion 0.574
KnowledgeAcquisition 0.675
KnowledgeStrong 0.697
KnowledgeApplication 0.650
KnowledgeProtection 0.681
KnowledgeDissemination 0.742
Table 2
Relationship between Trust &Organizational Performance and KM andOrganizational Performance
H1: KM andOrganizationalPerformance F = 71.469 P<0.00
H2: KM and Trust F = 70.643 P<0.00
The result reveals strong correlations inall knowledge management factors andorganizational performance. The
correlation data is shown in Table 1.It hasbeen found that the Knowledgemanagement process capability ofknowledge acquisition, conversion,application, protection has a strongmagnitude towards each other.Hypothesis H1 examines the effects ofknowledge management onorganizational performance. There is apositive relationship between knowledgemanagement and organizationalperformance. The proposed model issignificant (F = 71.469; p<0.00); itexplains 64% of variance inorganizational performance. Theknowledge acquisition, disseminationand protection are found to be essentialfor organizational performance, especiallyknowledge dissemination, which has asignificant positive influence onorganizational performance (â= 0.428, tvalue = 4.801, p<0.00). The strongrelationship between knowledgemanagement and organizationalperformance is supported by Gold et al(2001), Lee and Sukoco (2007) and Leeand Choi (2003). This finding is alsosupported by Darroch (2005) who foundthat knowledge acquisition, knowledgeapplication and responsiveness toknowledge positively affect firmperformance and innovation. ThereforeH1 is supported.Hypothesis H2 investigates the role oftrust as our moderating variable;regression analysis showed that withtrust, the model is significant as a whole(F =70.643; p<0.00); it explains 68%of variance in organizationalperformance, which is better than the firstmodel. Therefore, trust improves therelationship of knowledge management
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and organizational performance. Hence,the H2 hypothesis, that trust improves therelationship of organizationalperformance is supported.Relationship between knowledgemanagement and organizationalperformance: Knowledge management ispositively related to organizationalperformance, meaning that business withmore knowledge management showhigher capability in enhancingorganizational performance.When knowledge is considered an assetfor individuals, trust plays a major rolein knowledge management activities.“The greater the level of trust within acompany, the greater the likelihood ofcooperation. And cooperation itselfbreeds trusts”(Putnam, 1993,p.171).According to De Tienne et al(2004), transformation of knowledgeoccurs when individuals communicateand interact in order to synthesize theirindividual knowledge, then distributionoccurs when agreed-upon knowledge andcompetencies are used repeatedly andsubsequently embodied in theorganization’s norms and values orculture. Finally integration occurs whenthe organization successfully capturesexternal knowledge and successfullyintegrates it with internal knowledge (DeTienne, 2004). According to Snowden(2000) trust is the most criticalprerequisite for knowledge exchange.This is supported by Davenport andPrusak (1998) who posit that withouttrust, Knowledge initiates will fail,regardless of how thoroughly they aresupported by technology or rhetoric. Fora knowledge market to operate in anorganization, trust must be established in
the following three ways:Conclusion
The Positive relationship betweenknowledge application, knowledgedissemination and knowledge protectionis supported by the findings of Gold et al(2003), on large manufacturing firmswith sales profits. This result is alsosupported by Darroch (2005) who founda positive relationship betweenknowledge management andorganizational performance, particularlyknowledge dissemination. Knowledgemanagement requires a major shift andcommitment of every one in theorganization in adopting each factor ofknowledge management to make it work(Gupta et al, 2000). Working together asa team on various projects develops a goodculture and commitment among,manufacturers which encouragesknowledge application anddissemination. Knowledge is a stock ofexpertise (Baumard, 2002), therefore, itneeds to be disseminated in theorganization to make it valuable for theorganization. Trust is important innetwork relationships for firms to createand disseminate knowledge (Gold et al,2001). In this study, trust moderates theeffect of knowledge management flowwith-in an organization (Yli- Renko et al,2007). This is definitely true inmanufacturing firms where all knowledgeand information is consideredconfidential and classified. Trust makesthe knowledge management process moreefficient (Hoffman et al, 2005). Thisstudy has given some insights intoknowledge management practice inmanufacturing firms, especially in Indore.The positive outcome of this study shows
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that owners realize the importance ofknowledge management and this willdefinitely create a new opportunity formanufacturing firms to develop their ownknowledge management system in orderto be competitive in the long run.For managers, firstly, since KM is animportant antecedent, organizationsshould implement KM thoroughly. Inpractices, KM implementation almostmeans the construction KM system. Thisstudy suggests that knowledgemanagement implementation is theability of organization to acquire,converse, and apply their knowledge.After all, system implementation won’tequal to the ability to implement. So,managers should consider does one firmset up systems only? Or does one firmhave the capability to set up and exerciseit well?Limitations of the studyUtilizing a cross sectional design withquestionnaires is also one of thelimitations of this study. A future researchstrategy that may overcome this limitationis one that involves longitudinal studiesin which flow of knowledge andperformance can be followed over time.In addition, using objective measures,archival data for some variables, such asorganizational performance, may giveresults that are more objective.In addition to the nature of data, thegeneralizability of sampling is anotherlimitation of this study. The studyconducts in a specific national context. Itis important to note that readers shouldbe cautious when generalizing the resultsto different cultural contexts. Further, thesample size is relatively small, requiringthe increased sample size.
ReferencesAnthes,G.H. ( 1998). Learning How toShare. Computerworld, Vol.32,No. 8, pp.75-77.Andrew Hede, Bovey, and Wayne H. 2001.“Resistance to organizational change: therole of defense mechanisms”. Journal ofManagerial Psychology, 16(7): pp.553-548.Alavi M. and D.E. Leinder (2001).“Knowledge Management and KnowledgeSystems: Conceptual Foundations andResearch Issues.” MIS Quarterly(25;1),pp.107-136.Barney, J.B.(1991). Firm Resources andSustained Competitive Advantage. Journalof Management, Vol.17,No.1, pp.99-120Baumard, P. (2002). “Tacit Knowledge inProfessional Firms.” Journal of KnowledgeManagement, 6(2), pp.135–151Cameron, K. S., & Quinn, R. E.(1999). Diagnosing and ChangingOrganizational Culture: Based on theCompeting Values Framework. Reading,MA: Addison-Wesley.Chang K.L. et al (2005).KMPI: MeasuringKnowledge Management Performance.Information and Management.(42),pp.469-482Chowdhury, S. (2005). The Role of Affectand Cognition-based Trust in ComplexKnowledge Sharing. Journal of ManagerialIssues, 7 (3), pp.310-326Conner, K.R. and C.K. Prahalad, (1996).”A Resource – Based Theory of the Firm:Knowledge Versus Opportunism.Organization Science, (7.5), pp. 477-501.Cui, A.S., Griffith, D.A., Cavusgil, S.T.(2005). The Influence of CompetitiveIntensity and Market Dynamism onKnowledge Management Capabilities ofMNC Subsidiaries. Journal of International
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Marketing, Vol.13, No.3,pp.32-53.Darroch, J. (2005). KnowledgeManagement, Innovation, and FirmPerformance, Journal of KnowledgeManagement, Vol.9,No.3,pp.101-115.Dixon, N.M.(1999).The OrganisationalLearning cycle: How We can LearnCollectively, 2nd ed.,Newyork: McGraw –Hill,pp. 70-75.Davenport, T.H and Prusak,L. (1998).Working Knowledge: How OrganizationsManage what they Know. Cambridge, MA:Harvard Business School Press.De Tienne, K.B. et al (2004). TowardsModel of Effective KnowledgeManagement and Direction for FutureResearch: Culture, Leaderships, CKOs.Journal of Leadership and OrganizationalStudies.(10;4).pp.32-43.Du, Rong et al, (2007). Relationshipbetween Knowledge Sharing andPerformance: A Survey in Xian, China.Expert Systems with Applications.(32).pp.38-46.Dunford, Richard (2000). Key Challengesin the Search for the Effective Managementof Knowledge in Management inConsulting Firms. Journal of KnowledgeManagement. (4;4). pp 295-302.Egbu C.O. et al (2005). KnowledgeManagement for SustainableCompetitiveness in Small SurveyingPractices, Structural Survey. (23,1),pp 7-21.Gamble, P.R. and and Blackwell,J. (2001).Knowledge Management: A State of the ArtGuide. Kogen Page. London, UK.Garratt,B.(1990).Creating a LearningOrganization: A Guide to Leadership,Learning, and Development. NewYork:Simon and Schuster.
Gold A. H., Malhotra A., & Segars A. H.(2001). Knowledge Management: AnOrganizational Capabilities Perspective.Journal of Management InformationSystems, 18(1), pp.185-214.Grant, R.M.(1996). Toward a Knowledge– Based Theory of the firm. StrategicManagement Journal, Vol.17, winterspecial issue,pp.109-122.Gupta, B. et al, (2000). KnowledgeManagement: Practices and Challenges.Industrial Management and DataSystems.(100,1).pp 17-21.Hoffman J.J.et al, (2005). Social Capital,Knowledge Management and SustainedSuperior Performance. Journal ofKnowledge Management. 9(3). pp 93-100.Hunt, Shelby D. (1997), CompetingThrough Relationships: GroundingRelationship Marketing in Resource-Advantage Theory, Journal of MarketingManagement, 13 (5),pp. 431-445.Joreskog, K.G., Sorbom,D.(1993). LISREL8 User’s Reference Guide. Chicago:SSI.Kogut, B. and Zander, U. (1996), “WhatFirms Do? Coordination, Identity andLearning”, Organisation Science, 7(5),pp.502-518.Liao, S.H., Fei, W.C.,Chen, C.C.( 2007).Knowledge Sharing, Absorptive Capacityand Innovation Capability: An impericalstudy on Taiwan’s Knowledge IntensiveIndustries.Journal of Information Science,Vol.33,No.3,pp. 340-359.Lee, H. and Choi,B. (2003). KnowledgeManagement Enables, Peocesses, andOrganizational Performance: AnIntegrative View and EmpiricalExamination. Journal of ManagementInformation Systems. (20,1). pp.179-228Lee, L.Y., and Sukoco, B.M. (2007). The
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Effects of Expatriate Personality andCultural Intelligence on the ExpatriateAdjustment: The Moderating Role ofExpatriate. Proceedings of the 13th AsiaPacific Management Conference:Melbourne, Australia.Levin D.Z. and Cross,R. (2004). TheStrength of Weak Ties you can Trust: TheMediating Role of Trust in Effectiveknowledge Transfer. Management Science.(50,11) pp. 1477-1490Nahapiet,J.and Ghosal,S.( 1998). SocialCapital, Intellectual Capital and theOrganizational Advantage. Academy ofManagement Review.(23,2).pp 242-266.Nonaka, I. and Takeuchi, H. (1995). TheKnowledge –Creating Company: HowJapanese Companies Create the Dynamicsof Innovation. Oxford University Press.New York,NY.Nonaka, I. (1991) The KnowledgeCreating Company. Harvard BusinessReview, 69, (Nov-Dec), pp. 96-104Nunnally, J.C.(1978). PsychometricTheory, 2nd ed., NewYork: McGraw-Hall.Putnam, R.D. (1993) Making DemocracyWork: Civic Traditions in Modern Italy,Princeton University Press, Princeton, NJ.Snowden, D. (2000), The ASHEN Model:an Enabler of Action, KnowledgeManagement, April 2000 Vol 3 Issue 7Taylor, W.D. et al (2001). ManagingKnowledge-Workers in Accounting Firms:The Role of Nutrient Information andOrganizational Information Consciousness.Journal of Knowledge ManagementPractice, July 2001
Thurbin, P.J. (1994). Implementing theLearning Organization: The 17th DaysProgramme. London: Pitman Publishing,UKTippins,M.J.S., Ravipreet,S. (2003).ITCompetency and firm Performance: IsOrganisational Learning a Missing Link?Strategic Management Journal, Vol.24,No.8,pp.745-761.Widen-Wulff, G. and Suomi, R. (2007).Utilization of Information Resources forBusiness Success: The Knowledge SharingModel. Information ResourcesManagement Journal, Vol.20(1), pp 46-67Yeo, R.(2003), Linking OrganisationalLearning to Organizational Performanceand Success: Singapore Case Study.Leadership and OrganizationalDevelopment Journal, Vol.24,No.1/2,pp.70-84Yli-renko, H., Autio, E., & Sapienza, H.(2001). Social Capital, KnowledgeAcquisition And Knowledge ExploitationIn Young Technology-based Firms.Strategic Management Journal, 22, 587-614Author:Dr. Prateek Sharma, Director, New TechInstitute of Management and Technology,Dewas (MP)[email protected]. Babita Agarwal, Reader, ShriVaishnav Institute of Management, [email protected] Maheshwari, Lecturer, ShriVaishnav Institute of Management, Indore.monika_maheshwari07@ rediffmail.com#MJSSIM 2 (II) 02, 2010
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Introduction
In a highly competitive and uncertainglobalized environment, the banks arefacing number of challenges to endureand achieve sustainable competitive edgeover their rivals. They need to beefficient, resilient and evolve strategiesto face the emerging global challenges.They must work together to achievecompetitive efficiency by utilizingresources, introducing innovativeproducts and delivering high qualityservices to the bank customers at anaffordable price. In India, at present,potential customers of traditional banksare shifting towards e-banks (foreignbanks and new private sector banks)which have thrown many new challengesfor public sector banks to retain theirshare in the market. Globalization andWTO also added fuel to the fire and atthe same time, all these emerging changeshave created new opportunities forIndian public sector banks, the only need
Second Banking Sector Reforms and Comparative Effi-ciency of Banks in India-Emerging Issues and Challenges
R.K. Uppal
Abstract
Indian banking has undergone meticulous changes due to banking sector reforms where all knownparameters have changed. Entry of new private and foreign banks in Indian banking industry hasthrown bundle of new challenges for public sector banks as they are fighting to survive in this highlycompetitive environment. Due to emerging new competition, all Indian banks especially public sectorbanks are trying their best to improve their performance and preparing to compete in the globalmarket. In this context, there is a need to examine efficiency of banks operating in India. The presentpaper is an attempt to study the efficiency of Indian commercial banks during 1997-98 and 2005-06. The paper concludes that the profitability and productivity was much higher in case of newprivate sector banks and foreign banks as compared to Indian public sector banks. Even the liquidityposition of new private sector and foreign banks was also sound more as compared to theircounterparts. This paper suggests some possible measures to improve the efficiency of public sectorbanks and old private sector banks.
is to explore these opportunities in aproper and dynamic way. In the comingyears, only those banks will survivewhich are innovative, vigilant anddynamic.
Literature Review
In the extensive international literaturesurvey, Berger and Humphrey (1997)pointed out that, out of 130 efficiencyanalyses of depository financialinstitutions, covering 21 countries; onlyabout 5 per cent examined the bankingsectors of developing countries. They alsonoted that a vast majority (about 75 percent) of the efficiency literature focusedon the banking markets of well-developedcountries with particular emphasis on theUS market. The relatively scant literatureon the bank efficiency in emergingmarkets like India focused mainly on theefficiency differentials among banks withdifferent ownership status and asset size.In India, research on performance and
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efficiency of Indian banking industry israre in existing literature. Notable amongthese are Swami and Subrahmanyam(1994), Noulas and Ketkar (1996),Bhattacharyya (1997), Das (1997a,1997b), Saha and Ravisankar (2000),Shanmugam and Lakshmanassamy(2001) and Mukherjee, et al (2002),Leighter and Lovell (1998) and Zaim(1995).
Bhattacharya (1997) examined theimpact of partial liberalization duringmid-eighties on the productive efficiencyof 70 commercial banks using dataenvelopment method in the period 1986-91. They found that public sector bankshad the highest efficiency followed byforeign banks. The private banks werefound to be the least efficient. They alsofound a temporal improvement in theperformance of foreign banks, virtuallyno trend in the performance of privatesector banks and a temporal decline inthe performance of public sector banks.
Das (1997a) examined the efficiency ofpublic sector banks since nationalizationusing longitudinal data. The findingsindicated that banks of SBI group weremore efficient than the nationalizedbanks. The main source of inefficiencywas found to be technical in nature,rather than allocative. It has beenconcluded that inefficiency in publicsector banks is mainly due tounderutilization or wasting of resourcesrather than incorrect input combination.
Das (1997b) utilized non-parametricmethodology to derive efficiencymeasures for 65 major banks using cross-section data for the year 1995. It was herefound that, generally banks in India were
technically more efficient than allocativeefficiency. It also found that there is nosignificant difference in any of theefficiency measures between public andprivate sector banks, except scaleefficiency, foreign banks differedsignificantly from public and privatesector banks.
Leighter and Lovell (1998) investigatedthe Thai banking industry from both thebank and Government perspective from1989 to 1994. They found that theaverage Thai Bank had a rapidproductivity gain based on its ownobjectives, but during this periodproductivity gained from theliberalization program could not helpadvancing the Government objectives.
Mukherjee, et al (2002) made an attemptto explore technical efficiency andbenchmark the performance of 68commercial banks using dataenvelopment analysis. For this, theyutilized the data for the period 1996-99.It has been detected that in India, PSBswere more efficient than both private andforeign banks. Also, the performance ofPSBs improved over study period. Besidesthis, publicly owned banks were rateduniformly in terms of self-appraisal aswell as peer-group appraisal.
Noulas and Ketkar (1996) analyzed thetechnical and scale efficiency of publicsector/banks using data envelopmentanalysis by utilizing cross-section data of18 banks for the year 1993. It has beenobserved that overall technicalinefficiency was approximately 3.75 pcof which only 1.5 pc was on account ofpure technical inefficiency and 2.25 pcwas due to scale inefficiency and majority
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of the public sector banks were found tobe operating under increasing returns toscale.
Saha and Ravisankar (2000) rated 25public sector banks using dataenvelopment analysis for the period of1991-92 to 1994-95. It was found thatbarring few exceptions, public sectorbanks have in general improved theirefficiency over the study period. UBI,UCO Bank, Syndicate Banks and CentralBanks of India were found to be at lowerend of the relative efficiency scale. Also,Corporation Bank, OBC, SBI, CanaraBank, SBH, Bank of Baroda and DenaBank were found to be consistentlyefficient banks.
Shanmugam and Lakshmanasamy (2001)applied three approaches namely; non-parametric approach, stochastic frontierfunction and random coefficientapproach to measure efficiency andassessed robustness of the efficiencymeasures using data on domestic banksin India for the year 1999. It was foundthat overall mean technical efficiencyranges between 52 and 80 pc in differentapproaches. The high rank correlationamong efficiency values computed indifferent approaches has also beenobserved and the results indicated thatdeposit was the dominant factor indetermining the output of the banks inall the models.
Swami and Subrahmanyam (1994)applied ‘Taxonomic Method’ to study theinter-bank differences in the performanceof public sector banks in India. It has beenfound that many banks showed widedisparities in their measures of
performance especially with differentialweighting of individual indicators ofbusiness activity. No bank has shown ameasure of performance close to the idealof respective groups of banks. Almostevery bank in the study has neverattained even 50 pc efficiency measuresin both periods (1971-73 and 1987-89).
Zaim (1995) reported efficiency gains inTurkish banks after the 1980’sliberalization programme.
The review of literature on bankingefficiency in India reflects that none ofthe above mentioned studies examinedthe efficiency from different aspects. Thepresent study is an endeavor in thisdirection and aims to enrich the existingliterature concerning the efficiency of allbank groups in the post-second era ofbanking sector reforms in India.
Objective of the Study
To examine the comparative efficiency invarious bank groups in post-secondbanking sector reforms era.
Methodology
The present paper is concerned withcomparative efficiency of Indian bankingin the post-second banking sector reformsperiod. The whole banking industry isdivided into four major bank groups andthis paper excludes RRBs.
G-I: comprises Public Sector Banks - 28(Including IDBI Bank in 2004-05)
G-II: comprises Old Private Sector Banks- 21
G-III: comprises New Private SectorBanks - 7
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G-IV: comprises Foreign Banks - 31
Selected Efficiency Parameters
A. Productivity Ratios
• Business per Employee
• Profits per Employee
B. Profitability Ratios
• Interest Income as percentage ofTotal Assets
• Interest Expended as percentage ofTotal Assets
• Net Interest as percentage of TotalAssets
• Operating Expenses as percentageof Total Assets
• Provisions and Contingencies aspercentage of Total Assets
• Net Profits as percentage of TotalAssets
C. Financial Soundness
• Capital Adequacy Ratio
D. Quality of Assets
• Net NPAs as percentage of TotalAssets
• Net NPAs as percentage of NetAdvances
The present study analyzes these selectedratios to compare the competitiveefficiency of various bank groups.
DATABASE
• Report on Trends and Progress ofBanking in India, Reserve Bank ofIndia, Mumbai, Various Issues,From 1997-98 to 2005-06
• Performance Highlights, Indian
Banking Association, Mumbai,Various Issues, From 1997-98 to2005-06
Major Findings
Efficiency
The present paper examines theefficiency of banks in terms ofproductivity, profitability, financialsoundness and quality of assets.
Productivity
Productivity of banks can be gauged interms of business per employee, profitsper employee. Productivity is directlyrelated to profitability. It is interesting tonote from Table 1 that new private sectorbanks have always been more productiveespecially in terms of business peremployee as compared to that of publicand private sector banks.
Business per employee in case of foreignbanks was Rs.785.94 lakh in 1997-98 ascompared to Rs.529.40 lakh in newprivate sector banks. Business peremployee in case of public sector bankswas only Rs.88.51 lakh which was verylow as compared to other bank groups.No doubt in 2005-06 productivity ofpublic sector banks and old private sectorbanks increased in 2005-06 but still it isvery low in comparison to foreign banksand new private sector banks.
The productivity of new private sectorbanks was Rs.1012.70 lakh in 2005-06but it was only Rs.728.89 lakh in foreignbanks. Similarly, per employee profit wasthe highest in foreign banks and newprivate sector banks. It was Rs.11.35 lakhand Rs.4.49 lakh respectively in foreignbanks and new private sector banks
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in1997-98 whereas it was only Rs.0.70lakh and Rs.1.14 lakh in public sectorbanks and old private sector banksrespectively. At the end of the studyperiod, new private sector banks groupwas at the top among the various bankgroups. The main reason for the
increasing gap in productivity of newprivate sector banks and foreign banks ismainly because of new private sectorbanks use more IT, they are morecustomer-centric, have liberal policies ofRBI and mind set and commitment of
employees towards their organization.
Source:
1. Report on Trends and Progress ofBanking in India, Reserve Bank ofIndia, Mumbai, Various Issues,From 1997-98 to 2005-06
2. Performance Highlights, IndianBanking Association, Mumbai,Various Issues, From 1997-98 to2005-06
No doubt, now-a-days public sector bankshave also joined this race but still it willtake a lot of time to cover the distanceand move ahead of all. Structuralchanges, change in mind set is needed in
public sector banks. Among the publicsector banks, some banks like OBC,Corporation Bank, PNB are competingwith new private sector banks andforeign banks.
From the ongoing analysis, we mayconclude that overall foreign banks andnew private sector banks are much betterin productivity as compare to theircounterparts and these bank groups havethrown a challenge for the public sectorbanks as well as a new path to improvetheir productivity.
Profitability
Interest Income as a Percentage of
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Total Assets: Interest deregulation wasresponsible for the decline in the shareof interest income of the commercialbanks. The severe competition in interand intra-bank groups further accelerateddown trend in this ratio. The reason forhigher spread of new private sector banksas compared to public sector banks, old
private sector banks and foreign bankswas relatively lower interest cost ondeposits. Persistently declining trend ininterest spread of commercial banks inIndia during the last decade could beattributed to a slew of factors, such ascompetitive pricing, growing macroeconomic ability and healthy policy
environment.
Inter-country comparison of net-interestmargin revealed that net interest marginof Indian commercial banks at 2.88 percent in 2003 was much higher than thatof developed countries that rangedbetween 0.8 per cent and 2.4 per cent andintra-bank groups further accelerateddown trend in this ratio. This ratio wasadversely affecting the profitability of thebank groups. Table 2 exhibited that oldprivate sector banks and foreign bankswere comparatively more efficient evenduring the period of deregulation ofinterest rates.
Interest Expended as Percentage ofTotal Assets: Normally, private sectorbanks pay higher interest to attract the
new customers and retain the old bankcustomers. (Table 3)
As interest income declined in all bankgroups, similarly, interest paid was alsodeclined in all bank groups and due tothis; net margin has also been declined.Table 3 indicates that the maximuminterest was paid by G-II and G-I i.e. 4.16per cent and 3.98 per cent respectivelywhile it was the least (2.55 per cent) incase of G-IV in 2005-06.
Spread
The spread constitutes an importantindicator of efficiency of banks since it isthe most important driver of profitabilityof banks. The net interest as percentageof total assets of different bank groups inIndia is depicted in table 4. From this
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table, it was observed that new privatesector banks have the highest interestmargin in relation to their total assets i.e.3.52 per cent in 2005-06, whereas it wasonly 2.14 per cent in foreign banks and2.75 per cent in old private sector banks.
The reason for higher spread of newprivate sector banks group as compare toother bank groups was relatively lowerinterest cost on deposits of new privatesector banks. Persistently declining trendin interest spread of commercial banks in
India during the last decade can beattributed to a slew of factors, such ascompetitive pricing, growing macroeconomic ability and healthy policyenvironment. Inter-country comparisonof net interest margin revealed that netinterest margin of Indian commercialbanks at 2.88 per cent in 2003 was muchhigher than the developed countries thatranged between 0.8 per cent and 2.4 percent. Only US banks had moderatelyhigher net interest margin at 3.0 per cent.Thus score of interest spread of banks in
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India has fared better than those of othercountries.
Operating Expenses as Percentage ofTotal Assets: This ratio affects theefficiency of the commercial banks i.e.
how they manage the expenditure. Fromtable 5, it is clear that this ratio was thehighest in foreign banks i.e. 2.79 pc in2005-06 whereas it was only 2.06 pc inpublic sector banks. New private sectorbanks recorded the least operating cost
level i.e. 2.00 per cent in 2005-06.
Provisions and Contingencies asPercentage of Total Assets: Every bankshould have to maintain some provisionsand contingencies to secure their futureuncertainties. In this case foreign banks
were much efficient as compare to publicsector banks. Table 6 indicates that thisratio was 1.78 pc in foreign banks in2005-06 whereas it was only 1.12 pc incase of public sector banks. Hence,foreign banks and new private sector
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banks were much efficient as compare totheir counterparts.
Net Profits as Percentage of TotalAssets
Foreign banks operating in India and newprivate sector banks have been foundemploying their resources more
efficiently and possessed greater capacityto generate income as compare to publicsector banks. Thus, it may be noted fromTable 7 that new private sector banks hadthe highest ratio of net profits to totalassets (1.52 per cent) in 2005-06 followedby foreign banks at 0.97 per cent, but itwas only 0.59 per cent in old private
sector banks and 0.82 per cent in case ofpublic sector banks.
Financial Soundness
From the perspective of regulatory andsupervisory process, the CAR constitutesthe most important indicator for
evaluating soundness and solvency of thebanks.
It is observed from table 8 that among allthe bank groups under study, the CAR ofnew private sector banks was the highest
i.e.13 per cent in 2005-06. Similarly,foreign banks were also sound in thiscase.
Quality of Assets
Net NPAs as Percentage of Total
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Assets: Non-performing assets adverselyaffected the profitability of commercialbanks. From table 9 it is observed that in2005-06, the ratio was the highest (0.91per cent) in case of old private sector
banks but it was only 0.40 per cent incase of foreign banks. No doubt, netNPAs were declining in all bank groups,but private sector banks, particularly new
private sector banks and foreign bankswere much efficient to manage the NPAsas compare to other bank groups.
Net NPAs as Percent of Net Advances:The better quality of the assets is theindicator of better efficiency. The ratioof net NPAs to net advances was declined
in all the bank groups in 2005-06. Againit shows the efficiency of Indian bankingindustry but foreign banks and newprivate sector banks were efficientlymanaging their NPAs. Table 10 indicatesthat this ratio was only 0.80 per cent inforeign banks and new private sector
banks, whereas it was almost double incase of old private sector banks (1.60 percent).
We may conclude that public sector banksand old private sector banks should
improve their assets’ quality to competewith other bank groups. This ratio showsinefficiency of old private sector banksand public sector banks to manage theirNPAs level.
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ImplicationsThe main implication of the paper is thatin the post-banking sector reforms period,the performance of all bank groups haveimproved but public sector banks laggedbehind the new private sector banks, stillneed to make some effective strategies tocompete with their counterparts. Indianbanks, to expand their market base bypenetrating into untapped but highlypotential rural markets, lend greatersupport to boost production and providebetter customer satisfaction. They needto enhance their systems and proceduresto international standards andsimultaneously fortify their financialposition also.Enhancing Comparative CompetitiveEfficiencyIndian public sector banks have lowcompetitive efficiency as compare to newprivate sector banks and foreign banks.To increase the comparative competitiveefficiency of banks, the followingsignificant steps can be recommended.• Opening up the banking sector for
private sector participation.• Scaling down the shareholding of
the government of India innationalized banks and the RBI instate bank of India.
• Steps should be taken to reducepresent level of NPAs.
• On the basis of perceptions andexpectations of the customers,banks should try to increase the C-D ratio.
• More liberalization is required forbanks particularly for public sectorbanks.
Issues for Future Research• Mergers and acquisition of public
sector banks• New strategies of banks in the
global market• Feasibility and Viability of e-
banking services in rural and semi-urban markets
• IT and changing behavior of bankemployees
• Customer relationshipmanagement
• Business process re-engineering• Empowering of Banks through
Technology.• Study of external factors of
efficiency.ConclusionThe study reveals that comparativeefficiency of new private sector banks andforeign banks was much better ascompare to public sector banks. In someaspects, the new private sector banksperform better than the foreign banks.Productivity of foreign banks was thehighest, although have the highest costswhereas new private sector banksfollowed these banks with excellentgrowth and records the highestprofitability with lower operating costsand the maximum provisions forcontingencies. Although public sectorbanks have the lowest level of costs butthere was greater decrease in theirinterest income and expenditure mainlydue to deregulation that createdcompetition in the market and thesebanks have to change the interest ratesto retain in the market. The decline ininterest income and expenditure furtherresulted in decrease in their spread andbring down their profitability lower ascompare to new private sector banks andforeign banks. From liquidity point of
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view, new private sector banks andforeign banks were much stronger thanpublic sector banks and old private sectorbanks. Hence, the poor performance ofpublic sector banks laggard them behindthe other banks and they are facingnumber of challenges to survive andretain in the market. To gain soundposition and compete in the globalmarket, these banks have to change theirways of working and dealing withcustomers and hence need to adoptcompetitive strategies along with thelatest technology and change in mind -set. Indian public sector banks shouldexplore new opportunities created by thisnew changing environment.End notesTechnical Efficiency: Producing high output per unit of given inputAllocative Efficiency: Getting the mix ofoutput right, given their relative pricesOperational Efficiency: It is a functionof technical efficiency and allocativeefficiencyReferencesBerger, A. N. and Humphrey, David B.(1997), Measurement and EfficiencyIssues in Commercial Banking, in ZGriliches (ed), Output Measurement inServices Sector, University of ChicagoPress, Chicago, IL, pp 245-79.Bhattacharya, A. (1997), The Impact ofLiberalization on the ProductiveEfficiency of Indian Commercial Banks,European Journal of OperationalResearch, 98(2), pp 332-45.Das, A. (1997 a), Technical, Allocativeand Scale Efficiency of Public SectorBanks in India, Reserve Bank of IndiaOccasional Papers, 18(2 & 3), pp 279-301.Das, A. (1997 b), Measurement of
Productivity Efficiency and ItsDecomposition in Indian BankingFirms”, Asian Economic Review, 39(2),pp 422-39.Leighter, E.J. and Lovell, C.A.K. (1998),The Impact of Financial Liberalization onthe Performance of Thai Banks, Journalof Economics and Business, 50(4), pp115-31.Mukherjee, A; P. Nath and M. N. Pal(2002), Performance Benchmarking andStrategic Homogeneity of Indian Banks”,International Journal of Bank Marketing,20(3), pp 122-139.Noulas, A. G. and K. W. Katkar (1996),Technical and Scale Efficiency in theIndian Banking Sector”, InternationalJournal of Development Banking, 14(2),pp 19-27.Saha, Asish and T. S. Ravisankar (2000),A DEA Approach, European Journal ofOperational Papers, 124(3), pp 187-203.Shanmugam, K. R. & T. Lakshmansamy(2001), Production Frontier andEfficiencyMeasures: An Analysis of the BankingSector in India, Asian-African Journal ofEconomics and Econometrics, 1(2), pp211-228.Swami, S. B. and G. Subrahmanyam(1994), Comparative Performance ofPublic Sector Banks in India, Prajnan,XXII (2), pp 185-94.Zaim, O. (1995), The Effort of FinancialLiberalization on the Efficiency ofTurkish Commercial Banks, AppliedFinancial Economics, 5(3), 275-84.Author:Dr. R.K. Uppal, Director, UGC,Sponsored, Major Research Project,D.A.V. College, Malout (Punjab),[email protected]#MJSSIM 2 (II) 03, 2010
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Introduction
Customers have proved that servicequality has quantifiable impact oncustomer retention, market share andprofitability in the commercial world.However, even in the non-commercialworld, quality plays an important role.Quality management is vital in academicand special libraries even though librariesseem to have a group of captivecustomers. Academic libraries have toprovide quality service to the academiccommunity as the same communityevaluates their worth and hence the sizeof funding. To provide and upgradeservice quality, it is important to firstassess the quality of services presentlyoffered. This provides an importantfeedback for libraries to improve theservices to their users.
Definition of Service Quality
Donobedian, A. (1982) coined theconcept of quality of services earlier.Quality means different things todifferent people. Gavin (1986) identifiedeight dimensions of quality that could
Library Service Quality in Select University Libraries ofHyderabad: A libqual+tm Approach
S. Shyam Sunder Rao
Abstract
This article intends to examine and measure the quality of services provided by the Libraries usingLibQUAL+TM approach. The survey was conducted to determine expectations and perceptions ofthe quality of services offered by select University Libraries of Hyderabad. The Scope of the presentstudy is limited to the city of Hyderabad. Using LibQUAL+TM instrument, the perceptions aboutquality of services offered in these libraries has been examined in select university libraries ofHyderabad. The study brings, if any, variations between the perceived and the expected delivery ofquality of service by select University Libraries as perceived by the users. Implications are drawn forfuture research.
serve as a useful framework to addressquality issues in an organization. Theseare performance, features, reliability,conformance, durability, serviceability,aesthetics and perceived quality. As fewproducts can claim to rank high on alleight dimensions at all times, it is clearthat some dimensions can be achievedonly at the expense of the otherdimensions. Gavin (1986), therefore,suggested that companies shoulddifferentiate themselves by pursuingquality niches.
In contrast, Hermon and Altman (1996)focused their studies on service qualityand proposed four perspectives of servicequality as excellence, value, conformanceto specifications, and meeting and/orexceeding expectations. Their researchemphasized “meeting and/or exceedingexpectations” and led them to develop aframework for service quality inacademic libraries.
The various attributes of service make itdifficult to apply knowledge of productquality management to service quality
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management. Firstly, due to theintangibility of service, it cannot bedisplayed, physically demonstrated orillustrated. Secondly, service cannot bestandardized. As services cannot beinventoried, performance is dependent,to some extent, on the level of demand.Thirdly, there is a high degree of customerinvolvement in the delivery of service.While goods are produced, sold and thenconsumed, services are sold, thenproduced and consumed simultaneously.Thus, the buyer of service usuallyparticipates in producing the servicethereby affecting the performance andquality of the service. Thesecharacteristics make it difficult for aservice organization to control andprovide a consistent level of service, thusmaking evaluation of service quality morechallenging than evaluating quality goodsor services.
Encouraged by such approaches,professionals in other sectors of businesshave been exploring various customizedand most suitable approaches which areunique to their sectors and their clients.
One such mechanism for assessing user’sfeedback in the libraries is theLibQUAL+TM approach. (Association ofResearch Libraries, 1999). LibQUAL+TM
approach is similar to ServQUAL(Parasuraman, Zeithaml, V.A. and Berry,L.L., 1985) but is more focused andpertinent to libraries, designed on thebasis of the “Gap Theory of ServiceQuality”. (Richard Peterson, 2003).
LibQUAL+TM currently tests a tool formeasuring library users’ perceptions ofservice quality and identifies gapsbetween desired, perceived, and
minimum expectations of service. Thereis increasing pressure for libraries tomove towards outcome-based assessment,instead of relying merely on input,output, or resource metrics. This pressurecomes from funding authorities as wellas users. Outcome measures may showhow well an organization serves its users:they demonstrate universities’ efficiencyand effectiveness. LibQUAL+TM assumethe existing gaps with the help of thefollowing aspects of the quality required.
Minimum: It is the state of quality, whichrepresents the minimum level of servicethat users would find acceptable to them.
Desired: It is the state of quality, whichrepresents the level of service that ispersonally wanted by the user.
Perceived: It is the state of quality thatrepresents the level of service that users’believe that the library currently providesto them.
The LibQUAL+TM survey evolved froma conceptual model based on theSERVQUAL instrument, a popular toolfor assessing service quality in theeducational sector. Texas A&MUniversity Libraries and other librariesused modified ServQUAL instrumentsfor several years; those applicationsrevealed the need for a newly adapted toolthat would serve the particularrequirements of libraries. Association ofResearch Libraries (ARL) representingthe largest research libraries in NorthAmerica, partnered with Texas A&MUniversity Libraries to develop, test, andrefine LibQUAL+TM.
LibQUAL+TM gives library users achance to tell where the services need to
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improvement so that the libraries canrespond to and better manage theirexpectations. Libraries can developservices that better meet users’expectations by comparing library’s datawith that of peer institutions andexamining the practices of those librariesthat are evaluated highly by their users.It is a starting point to identify bestpractices improving library services withthe help of LibQUAL+TM and also allowsto seeing the relationship with otheracademic libraries.
Review of Literature
Most studies assessing service quality arebased on the Disconfirmation theory thatcompares customers’ expectations andperceptions of the service. The SystemsTheory is also used to develop servicequality models. This theory viewscomponent of the system – inputs,processors, and outputs as playing animportant role in the successful deliveryof service.
Studies reveal that service quality is amulti-attribute construct. Gronroos(1984) defined service as being composedof the technical quality and functionalquality dimensions. Bolton and Drew(1991) acknowledged that there arevarious attributes and dimensions ofservice and reported that customers gothrough services of processes to assessservice, Parasuraman, Zeithaml, V.A. andBerry, L.L. (1985) reported five servicedimensions for service assessment,namely Tangibles, Reliability,Responsiveness, Assurance andEmpathy.
The original dimension of ServQUALpropounded by Parasuraman, Zeithaml,
V.A. and Berry, L.L. (1985). They are:
Tangibles: The appearance of thephysical facilities and materials related toservice.
Reliability: The ability to perform theservice accurately and dependably.
Responsiveness: The willingness to helpusers and provide prompt service.
Assurance: The competence of thesystem and its security, credibility andcourtesy.
Empathy: The ease of access,approachability and effort taken tounderstand users’ requirements.
Studies on Service Quality inLibraries
Pritchard (1996) addressed the issues ofquality management in academic librariesand emphasized the importance ofmonitoring and meeting the needs ofcustomers. Quinn (1997), however,cautioned against the outright applicationof service quality models from thebusiness world in academic libraries, as“the goals and the methods of academicand the relation of staff to customers, aremore complex than the business andmanufacturing settings from whichservice quality concepts is developed”. Tosummarise, the library research literatureshows that quality assessment efforts inlibraries are moving from performance,measures that focus on traditional inputand output measures, to measures thatfocus on feedback from customers.
LibQUAL+TM
LibQUAL+TM is a joint research anddevelopment project of Texas A&M andAssociation of Research Libraries. They
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took initiated in the year 1999 andimplemented in 2000. Service marketinghas identified the consumer or user as themost critical voice in assessing servicequality. Before assessments can be madeof service quality in Association ofResearch Libraries (ARL, 1999), it isessential to investigate what connotesservice quality in the minds of libraryusers. Today, the dimensions of libraryservice quality among the Association ofResearch Libraries Cohort are not fullyunderstood from the user perspective.The LibQUAL+ project attempts toidentify those dimensions and measurethe gaps between expected service andperceived service in each dimension. Thefive service dimensions of ServQUAL hasbeen converted into LibQUAL+ clusterinto five first-order factors, ordimensions, such as (1) Affect of Service;(2) Reliability; (3) Library as Place; (4)Provision of Physical Collections; and (5)Access to information.
The first two dimensions namely, Affectof Service and Reliability is deriving fromthe original ServQUAL instrument.Whereas the other three dimensionsnamely: Library as Place, Provision ofPhysical Collection and Access toinformation were developed from theinterviews of large number of libraryusers by the Association of ResearchLibraries (ARL) team (2001). Presently,they are reduced to three dimensionsfrom 2003 to till date, i.e., Affect ofService dimension, Information Controldimension and Library as Place.
Studies on LibQUAL+TM
The present study addresses the gap byapplying the LibQUAL+TM among 358
students of a state-owned university inNorthern Cyprus. A conceptual modelLIBZOT is presented in this study, andthe results demonstrate that evaluationof services can be scaled according todifferent types of expectations- ‘desired’and ‘adequate’ – and that students usethese two types of expectations as acomparison standard in evaluating libraryservices. The findings reveal thatstudents have a narrow zone of tolerancewith regards to the services provided bylibraries. (Halil Nadiri, 2010).
Assessment in academic libraries is moreimportant than ever as we strive to satisfyusers, administrators and accreditationagencies, and present data to informongoing and future strategic directions.LibQUAL+™ yields a substantive set ofquantitative and qualitative data that isrelatively fast and easy to analyze, and isespecially useful when significant skillsand time to conduct meaningfulassessment may not be present, such asin smaller academic libraries.Communicating the results and responsesof assessment to stakeholders is a vitalaspect of assessment and may in itself beindicative of the likelihood to enactpositive change based on the data. Thisarticle surveys the landscape ofLibQUAL+™ users’ results reporting anddescribes a specific strategy to quicklysummarize data and articulate results andresponses to stakeholders. (Forte, Eric,2009).
Edinburgh University Libraryparticipated in the LibQUAL+ Survey,2005 and compared with the 2003 survey.The overall results were similar to 2003.Some of the desired scores are higher thanin 2003, while the average scores for the
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general satisfaction questions are allslightly down from 2003. The surveyhighlights particular areas where thereare “negative scores”. That is where usersscores the service they receive below theminimum they would expect. Withregard to services, they received negativescores and in the area of accommodationtaking all users together, they receivednegative scores. The library is addressingsome of the concerns, both throughongoing, incremental changes in libraries,as well as through more major changesgoing to take place. They are alsoconducted survey in other dimensions,such as collections, user categories,college results, and benchmarking. Theresults from Edinburgh showedmarginally higher expectations of service,and correspondingly marginally moredissatisfaction. The management teamcontinues to monitor the results againstother institution’s results as they becomeavailable for further analysis. (RichardBattersby, 2005).
The Clemson University Libraries areparticipated in the LibQUAL+TM surveyadministered by Association of ResearchLibraries. The total respondents wereparticipated in this survey are 595. Theyconducted survey in three-dimensionalareas of Information control, Affect ofservice and Library as place. Overall, theyseem to be found that meeting the needsof undergraduates, as they gave highscore. With regard to the service, theygave top priority by undergraduates.They are also improving electronic andprint journals collections, but need tocontinue to work on this especially forfaculty and graduate students. (JanComfort, 2004).
Queen’s University, Kingston, Canada,conducted the LibQUAL+ survey amongthe 1,13,000 respondents covering nineCanadian Institutions using theLibQUAL+ instrument to measure theService quality in the areas of Affect ofService; Library as Place and InformationControl during spring 2004. The resultsare measure of perceived service qualityin relation to user expectations for thatservice or library facility. Further tellsthat where we need to focus our attentionto improve services, users priorities andservice expectations are strikinglyconsistent among the institutionsparticipating in the survey. (Sam Kalb,(2004).
The Statement of the Problem
This article proposes the use of anadapted LibQUAL+TM instrument tomeasure the service quality of selectedUniversity Libraries of Hyderabad. TheLibQUAL+TM instrument is based on theGap Model, states that the serviceshortfalls experienced by customers arethe results of service gaps that existwithin the selected University librariesof Hyderabad. Where as theLibQUAL+TM, designed exclusively forlibrary services is more focused and in-depth in its applicability to the users oflibraries. Thus in this study, onlyLibQUAL+TM approach will be adoptedsince this approach to services quality inlibraries has received greater support inthe Western countries.
Thus, while keeping these issues in mind,this study intends to explore the qualityof services provided by the selectUniversity libraries in Hyderabadnamely; Osmania University, Hyderabad
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Central University, Acharya N.G. RangaAgricultural University and JawaharlalNehru Technological University.
It intends to examine the relativeimportance of each of the dimensions ofservices quality provided by the selectlibraries using LibQUAL+ approach.The dimensions are:
I) Affect of Service dimension (it isthe extent to which the usersperceive that the library staff iswilling to help users, by beingcourteous, dependable in handlingproblems, giving attentionindividually, caring the users, readyto answer, and instilling confidencein the users;
II) Information Control dimension(extent to which journals andbooks are made available for all thestudents of possible streams ofdisciplines, timely services delivery,convenient service hours andcomprehensive collections aremade provisions for the users bythe management of the libraries);and
III) Library as place Dimension (extentto which the library provides spacefor quite study, creating anatmosphere of quite and solitude,for reflection and creativity,comfortable and inviting locationand contemplative environment).
This way, the dimensions pertinent to theservices in the library will be studied andsuitable implications can be drawn for thefurther improvement of the libraryservices.
The user’s expectations and perceptionsabout the services quality usingLibQUAL+ approach will be assessedfollowed by an examination of the gapsexisting in their expectations andperceptions. This way, implications formanaging the gaps can be explored moreeffectively.
This way, customized solutions for theimprovement of quality of services inthese libraries will be explored sincemany libraries are unique in providingdifferential services to their users. Thus,it will initiate a major movement towardsquality of services in select Universitylibraries of Hyderabad.
Objectives of the Study
This study applies LibQUAL+TM
instrument to assess the level of serviceprovided by the select University librariesof Hyderabad. The objectives of the studyare:
1. To determine the relativeimportance of each of theLibQUAL+ TM dimensions whenusers assess the services ofLibraries.
2. To determine intra-library analysisof users’ expectations andperceptions of the current level ofservice of the University librarieson LibQUAL+ TM dimensions.
Status of Hypothesis Testing – H1
In view of these objectives, it washypothesized that H1, “There are nosignificant gaps in the Quality of Servicesoffered by the Libraries within theUniversity”, the summary of gap analysiscalculated for testing of hypothesis in theresults and discussions.
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Methodology
Survey and comparative methods areused for conduct of the study. The presentstudy will be carried out in selectUniversity Libraries of Hyderabad. Theseare from Osmania University, HyderabadCentral University, Acharya N.G. RangaAgricultural University and JawaharlalNehru Technological University. Theselibraries have been chosen, because of
their unique Academic Library systemand also owing to their high-tech servicesoffered to the users.
Sampling
A systematic random sampling techniquewas adopted in the selection of therespondents from the selected Universitylibraries of Hyderabad. The samplingframe is presented in Table-1.
From each University library, a sampleof 25 Faculty members and 125 Studentswere chosen on systematic randomly andto whom a standard questionnaire wereadministered. Total sample size is fromeach University is 150. For fouruniversities the aggregate sample size of100 faculty members and 500 studentsin all the sampling from include 600users.
The scale adopted for the measurementof quality of services in the libraries is
the 44-items LIBQUAL+ scale developedby Texas A&M and ARL Libraries(2001). From 2003 onwards, they revisedscale on 22-items scale on 3-dimensionsfrom 2003 onwards till date on thesedimensions, such as Affect of Servicedimension consists of 9-items,Information Control dimension consistsof 8-items and Library as Place dimensionconsists of 5-items. The scaling patternsuggested by the developers is seven-pointscale (where 1=strongly disagree and7=strongly agree). Each of these items
Table 1Sampling Frame
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is measured taking three perspectives ofthe services as reported by the users.These perspectives are minimum serviceexpected, desired service expected andthe actual service existing. All these threeperspectives of quality of servicesperceived by the users of these librarieswill be assessed.
Results and Discussions
The following table explains about theGap Analysis of Service Quality providedby the Select University Libraries ofHyderabad. On all the three dimensionsof LibQUAL+TM has been computed onoverall items of the Universities arepresented in Table - 2.
Table 2Gap Analysis of Quality of Service in Universities
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With regard to Affect of Servicedimension, Service Adequacy gaps aresignificant in Osmania University (t =4.703, d.f. = 149, P = .00) andJawaharlal Nehru TechnologicalUniversity (t = -2.67, d.f. = 149, P =.00). However, the gaps are notsignificant in Hyderabad CentralUniversity (t = -0.51, d.f. = 149, P =.61) and Acharya N.G. RangaAgricultural University (t = -0.62, d.f.= 149, P = .53).
On the other hand, with regard to ServiceSuperiority on Affect of Servicedimension, the gaps were foundsignificant in all the Universities such asOsmania University (t = -1.96, d.f. =149, P = .05), followed by HyderabadCentral University (t = -7.9, d.f. = 149,P = .00), Acharya N.G. RangaAgricultural University (t = -7.8, d.f. =149, P = .00) and Jawaharlal NehruTechnological University (t = -8.78, d.f.= 149, P = .00). Since, the gaps weresignificant in large no., hence, the nullhypothesis stands rejected.
As regard to Information Controldimension, Service Adequacy gaps aresignificant in Osmania University (t = -2.54, d.f. = 149, P = .01) and JawaharlalNehru Technological University (t = -3.43, d.f. = 149, P = .00). However, thegaps are not significant in HyderabadCentral University (t = 0.11, d.f. = 149,P = .91) and Acharya N.G. RangaAgricultural University (t = -0.57, d.f.= 149, P = .56).
On the other hand, with regard to ServiceSuperiority on Information Controldimension, the gaps were foundsignificant in all the Universities such as
Osmania University (t = -6.88, d.f. =149, P = .00), followed by HyderabadCentral University (t = -7.23, d.f. = 149,P = .00), Acharya N.G. RangaAgricultural University (t = -7.75, d.f.= 149, P = .00) and Jawaharlal NehruTechnological University (t = -9.21, d.f.= 149, P = .00). Since, the gaps weresignificant in large no., hence, the nullhypothesis stands rejected.
As regard to Library as Place dimension,Service Adequacy gaps are significant inOsmania University (t = 5.35, d.f. =149, P = .00) followed by HyderabadCentral University (t = 2.46, d.f. = 149,P = .01) and Jawaharlal NehruTechnological University (t = -5.57, d.f.= 149, P = .00). However, the gaps arenot significant in Acharya N.G. RangaAgricultural University (t = 0.27, d.f. =149, P = .78).
On the other hand, with regard to ServiceSuperiority on Library as Placedimension, the gaps were foundsignificant in all the Universities such asHyderabad Central University (t = -3.98,d.f. = 149, P = .00) followed by AcharyaN.G. Ranga Agricultural University (t =-5.52, d.f. = 149, P = .00) and JawaharlalNehru Technological University (t = -5.57, d.f. = 149, P = .00) exceptOsmania University (t = -1.24, d.f. =149, P = .00). Since, the gaps weresignificant in large no., hence, the nullhypothesis stands rejected. In otherwords the Quality of Service differs inuniversities accordingly.
Implications for Future Research
Future research might also consider anexamination of the LibQUAL+TM scoresfor each demographic sub-group within
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the pool of respondents. Is there adifference between faculty responses,students’ responses and the researchscholars’ responses. Are thosedifferences the same at different types ofinstitutions or university libraries? Arethere differences among the academicdisciplines? For example, facultymembers, who have used libraries andconducted research successfully, are verylikely to have a different view thanstudents about whether collections meettheir needs and whether informationresources are easily located. Similarly,faculty in the sciences, may use thelibrary differently than faculty inmathematics, it would be interesting tosee whether that influences the way inwhich individual faculty membersrespond to the LibQUAL+TM survey.
Conclusion
The current study is an addition to thecontinuous qualitative and quantitative,iterative process that is necessary tomaintain a useful and higher impactinglibrary services. LibQUAL+® “showsconsiderable promise of serving as a toolof some utility in listening to user voices”(Cook, 2000) much like the full versionof LibQUAL+® has in the recent past.This study employed the gaps in servicesoffered by select university libraries ofHyderabad. Osmania University wasfound offering better quality servicesfollowed by Hyderabad CentralUniversity. The least quality services areoffers as perceived by users are inAcharya N.G. Ranga AgriculturalUniversity and Jawaharlal NehruTechnological University.
This kind of research study gives policy
direction to the management of suchlibraries. Besides, LibQUAL studies haveto continue on a regular basis for trackingthe services provided by the UniversityLibrary.
References
Association of Research Libraries (1999).Battersby, Richard (2005). (http://lib.ed.ac.uk/about/libcom/papersjun05/a10jun05.pdf)
Association of Research Libraries (2001).
Battersby, Richard (2005). (http://lib.ed.ac.uk/about/libcom/papersjun05/a10jun05.pdf)
Bolton, R.N. and Drew, J.W. (1991). AMultistage Model of Customers’Assessment of Service Quality and Value.Journal of Consumer Research, 17, 375-384.
Comfort, Jan (2004). http://. l i b . c l e m s o n . e d u / G o v D o c s /LibQUAL_2004.html
Cook, Colleen and Fred M. Heath, et al(2000). “LibQUAL+: One Instrument inthe New Measures Toolbox Adaptationof the SERVQUAL Survey Instrument forResearch Libraries”. ARL (212) pp 4-7.
Forte, Eric (2009). Assess, Improve, andShare: Using LibQUAL+ to Provide aQuick and Easy Assessment forAccreditors, Administrators and Users.59 (2), Special Section, pp 1-11.
Donobedian, A. (1982). Exploration inQuality Assessment and Monitoring: TheCriteria and Standards of Quality, Vol.2,Ann Arbor, MI: Health AdministrationPress.
Gavin, D.A. (1986). Managing quality:
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The Strategic and Competitive Edge.New York: The Free Press.
Gronroos, (1984). A Service QualityModel and its Marketing Implications.European Journal of Marketing, 18 (4),pp 36-44.
Hermon, Steve Peter and Altman, E.(1996). Service quality in AcademicLibraries. Norwood, New Jersey: Ablex.
Kalb, Sam (2004).http://library.queensu.ca/webir/libqual/libqual_working_group.htm
Nadiri, Halil and Mayboudi, SeyedMuhammad Ali (2010). DiagnosingUniversity Students’
Zone of tolerance from UniversityLibrary Services. Malaysian Journal ofLibrary and Information Science, 15 (1).
Parasuraman, Zeithaml, V.A. and Berry,L.L. (1985). SERVQUAL: A Multiple-Item Scale for Measuring CustomerPerceptions of Service Quality. Journal ofRetailing, V.64, pp 12-40.
Pritchard, S.M. (1996). DeterminingQuality in Academic Library. LibraryTrends, 44, pp 572-594.
Quinn (1997). Adapting Service QualityConcepts to Academic Libraries. Journalof Academic Librarianship”, 23, pp 359-369.
Richard Peterson et.al. (2003). Collegeand Research Libraries, 64, pp 124-132.
Author:
Dr. Shyam Sundar Rao, Librarian, SivaSivani Institute of Management,[email protected]
#MJSSIM 2 (II) 04, 2010
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Psychosomatic Correlates of Stress: An Empirical Analysis
Meena Dorathi
Abstract
Since the era of industrial revolution, the problems of stress and stress reactions among employeeshave incessantly been the focus of all the concerned in modern organizations – may they be profit ornon-profit oriented. One such organization is the modern school and the attention is on stress amongthe teachers. Evidences point to the fact that teachers are the most victims of stressful work experiencesand are the early drop-outs of the profession. This study addresses the challenges of stressfulexperiences and the psychosomatic complaints reported by 120 school teachers from three types ofschools (Private, Government and the NGO-run) in the twin cities of Hyderabad and Secunderabad.Besides, it examined the nature and extent of relationship between self-report job stress experiencesand psychosomatic problems. Results reveal that job stress among teachers is at variance acrosstypes of schools. Simple regression analyses results revealed that of twelve psychosomatic problems,pain in back/spine has emerged as the most pronounced outcomes of job stress followed by spellsdizziness and sweating hands. Unlike other studies, this study suggested organizational strategiesas most effective coping mechanisms of job stress
Introduction
Perhaps there is no other concept inphysical and social sciences that hasgained unrivalled attention from theprofessionals is the concept of stress. Theconcept of Stress has been the focus ofattention for various professionals inmedical, para-medical and managementprofessionals. It is viewed seriously bydoctors, psychologists, medical socialworkers, managers and educationaladministrators. Though stress as aconcept is considered a necessary evil inall work domains due to its nature as adrive towards the goal (without stresspeople do not work), it releasesdeleterious effects on the health of theindividual and that of the organizationwhen it reaches above tolerance levels inmodern organizations.
A plethora of theoretical, analytical andresearch studies abound in the area ofwork related stress. Consequently,
interest in such phenomenon hasincreased markedly during the last fewyears for certain distinct reasons.
As regards the understanding of thereasons behind such problem, one of themain reasons, the study of work stresshas generated so much interest, is that itis involved in the etiology of bothphysiological and psychological illness(Brief 1981; Ivancevich and Matteson,1980). Secondly, it contributes to theorganizational problems such asemployee dissatisfaction, alienation,lowered productivity, absenteeism, andturnover (Jick and Payne, 1980; Parkerand Decotiis, 1983).
Further, in the recent past, a very largenumber of studies on job stress haveeither extensively related to identificationof several significant work relatedantecedents/stressors (Parker andDecotiis, 1983); organizational stressors(Brief, 1981); role related stressors
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(Khan, 1983); Career related stressors(Parker and Decotiis, 1983);interpersonal relations related stressors(Ivancevich and Matteson, 1980); extra-organizational stressors (Parker andDecotiis, 1983); or identifying thedimensionality of scales to measure theconcept of stress for, it was labeled as themost imprecise term in the scientificdictionary (Ivancevich and Matteson,1980). Thirdly, the consequences ofstress like defensive behaviors (Parkerand Decotiis, 1983; Ashforth, 1989),burnout (Maslach, 1976), psychosomaticproblem (Quick and Quick, 1984),lowered self-esteem (McGrath, 196), andorganizations consequences like loweredjob performance (Motowidlo, 1986),decreased organizational commitment(Parker and Decotiis, 1983), increasedoffensive behaviors like strikes andsabotage (Sekaran, 1984) were alsoreported.
From among all the stated outcomes ofjob stress, psychosomatic illnesses havereceived very less research attentioneither in western societies (Piko andNoemi, 2006; Tanaka, et.al, 2005;Okulicz-Kozaryn and Borucka, 2004;Quick, Horn and Quick, 1986; Quick andQuick, 1984; Cooper and Marshel, 1984)or in India (Prasad, 1991; Sharma andShukla, 1993).
When there are variations on the wayconceptualsation has taken place,psychosomatic symptoms are defined assubjective physical complaints such asheadache, stomachache, backache, anddizziness as well as psychologicalcomplaints such as feeling low, irritable,or nervous or having difficulty, sleeping(Natvig and Albrektsen, 1999). In
United States of America, Quick, Hornand Quick (1986) and Quick and Quick(1984) have reported that thepsychological consequences of job stresswere psychiatric problems, includingfamily problems, sleep disturbances,sexual dysfunctioning, depression,psychogenic disability, headache,heartburn, backache, generalized fatigueand burnout. Whereas, Greenhaus andParasuraman (1984) emphasize tension,anxiety, boredom, self-esteem is thepsychosomatic consequences. In UnitedKingdom, Davidson and Cooper (1984),reported nervousness, tension, headache,tiresomeness, difficulty to get up inmorning, cry easily, spells of dizziness,nightmares, not eating, want to be leftalone, mental exhaustion as thepsychosomatic illnesses predominantamong female managers. They have alsoreported that female managersexperienced more often a far greaternumber of psychosomatic symptomscompared to male managers.
While keeping the consistency andconformity with the earlier studies, inthis study, job stress is defined as thepsychological stage experienced by anindividual when faced with demands,constraints, and/or opportunities thathave important but uncertain outcomes(Greenhaus and Parasuraman, 1984).Whereas, psychosomatic problems areidentified as those that pertain to theinterrelationships of mind and body,usually referring to the individualsymptoms that appear to be physical butare partly or fully the result ofpsychological factors (Davidson andCooper, 1984).
As many studies on psychosomatic
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problems as individual consequences ofwork stress have been grossly under-represented in the research literature onstress, this study intends to assess thedegree of job stress experienced by schoolteachers across three types of schoolsnamely, private, government and NGOschools. Secondly, it intends to identifythe relationship between job stress andpsychosomatic problems experienced bynursing personnel chosen from threedifferent hospitals. Thus it washypothesized that that,
Ho1 - Teachers do not vary in their jobstress according to the type of schools towhich they belong and,
Ho2 - There is no positive and significantcorrelation between job stress andpsychosomatic problems.
Material and methods
Research design is the backbone of theresearch study as it provides the scientificframework for the study. In this study,descriptive research design is adopted dueits suitability. Thus, 120 teachers- 40each from Private, NGO Support Schools,Government Schools chosen employinga stratified disproportionate randomsampling technique, were administereda structured questionnaire. Thisquestionnaire contained three parts. PartA elicited responses regardingdemographic data whereas Part Bincluded a 16-item scale devised by Parkerand Decotiis (1981) for measuring timestress and anxiety stress (alphacoefficient is 0.86). Wherever necessary,in the scale items the word ‘client’ isreplaced with the word ‘student’. All theitems were measured with the help offive-point scale (where 1=never and
5=every day). Learned helplessness asanother stress dimension is measuredwith seven items Helplessness scale(HLPLS) (Kanango and Menon,2004)(alpha coefficient is 0.79). Lastly, Part Cincluded Naughton’s (1988) scale tomeasure self-report psychosomaticproblems (Where 1= strongly disagreeand 5 = strongly agree). The reliabilitycoefficient of the scale is 0.88, indicatingthat the scale is highly internallyconsistent.
Results and Discussion
As regards the testing of the firsthypothesis, it was hypothesized that“Teachers do not vary in their job stressaccording to the type of schools to whichthey belong”. Means, standard deviationswere computed separately for teachersaccording to their schools. Further fortesting the variations in their meanscores, fvalues were computed. Resultspertaining to the testing of this nullhypothesis have been presented in table1.
It is seen from the table that, privateschool and NGO run school teachers areexperiencing more time stress than theircounterparts in government schools.Further the f value also suggests that suchvariation in their mean score is staticallysignificant. Surprisingly, work relatedanxiety has been found to be invariantacross all the types of schools. However,NGO school teachers were found veryhelpless than their counterparts inprivate schools and government schools.Such variation is also found statisticallysignificant as evident from the fvaluepresented in the table. Lastly, privateschool teachers are found suffering with
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more stress in their work place than theircounterparts. Such variation is also foundstatistically significant. All these resultsindicate that the schools teachers areindeed suffer from job stress in their workplaces. Thus, the null hypothesis isrejected, indicating that that type ofschool does have a major influence incausing varying degrees of stress in schoolteachers. Teaches workplace is verydemanding since they need to beequipped to be ready for the teachingassignment in general and regularlyprepare for the classes, deliver thecontent, evaluate the student assignmentsin time. All these generate time pressureand work related anxiety, eventually,helplessness.
The reasons for time stress are soglaringly known for their observance oftime tables, class schedules, examinationtimings, deadlines in preparing lessonplans, evaluation of exam and test papers,the progress reports. Besides, preparingstudents for extracurricular activities ona regular basis also creates time pressure.Every time the bell rings for the nextclass, the time stress starts for everyteacher and thus, it continues all throughthe day, until the last bell which relievesthem for that day. Similarly, their workseems unfinished and never ending as
one phase of completion leads to anotherphase of work to be commenced. As aresult their anxiety is always on thehighest. Every time, the principal callsand the parent-teacher meetings arescheduled, their anxiety increases.Therefore, such experience is very globalirrespective of the type of school theywork for.
Learned helplessness is a psychologicalstate resulting from expectations of futureuncontrollability of outcomes, theexpectations themselves being the resultof repeated exposure to non-contingentor uncontrollable outcomes. It ischaracterized by retarded initiation ofvoluntary responses (motivationaldeficit), retarded perception of therelationship between responses andoutcomes when they do exist (cognitivedeficit) and depression (emotionaldeficit). Thus, the school teachers arevery helpless as reported here. On onehand they give emotional supportthrough counseling for heightened self-esteem among the students, whereas intheir own case self-esteem is bruised dueto the lack of support from all corners’including family sometimes. Thus,helplessness is a very serious stressdisorder among teachers.
Table 1
Stress Experiences by Type of School
Sno Stress Experiences Private Government NGO F (2,112)
1 Time Stress 23.35 20.95 23.85 7.966*
2 Anxiety 18.7 19 18.5 0.300
3 Helplessness 17.05 16.8 19 6.665*
4 Total Stress 44.05 39.95 42.35 3.326*
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Psychosomatic Complaints
As regards the testing of the secondhypothesis, the psychosomatic problemsreported by the participants were treatedas dependent variables and job stress asindependent variable. Results in thisregard are presented in table-2. A
regression analysis approach was utilizedto examine the nature and type ofrelationships among job stress andpsychosomatic problems and to find outthe explanatory power of stress inpredicting variances in psychosomaticproblems.
Table 2
Simple Regression Analysis
Sno Psychosomatic Complaints beta R2 F P=
1 Trouble in breathing 0.125 0.013 1.65 0.20
2 Pain in backorspine 0.396 0.173 24.49 0.00
3 Tiresomeness 0.314 0.092 12.01 0.00
4 Trouble getting asleep 0.299 0.081 10.42 0.00
5 Trouble staying asleep 0.167 0.034 3.00 0.08
6 Difficulty in getting up 0.001 0.010 0.00 0.92
7 Spells of dizziness 0.397 0.175 23.46 0.00
8 Sweating hands 0.416 0.156 23.52 0.00
9 Nervousness 0.163 0.035 3.04 0.84
10 poor appetite 0.268 0.079 7.82 0.00
11 Heart pounding 0.252 0.076 8.15 0.00
12 Total score 0.474 0.244 36.13 0.00
It is clearly observed from the table that,of all the psychosomatic complaints of jobstress, ‘pain in back/spine’ has emergedas the strongest, positive and significantcorrelate (0.39) of job stress, which haspredicted 17 per cent of variance in ‘back/spine pain’. Second strongest correlatesin the series were ‘spells of dizziness’(0.39) ‘sweating hands’ (0.41). Thirdstrongest correlate was ‘tiresome’ (0.31),in which job stress has predicted ninepercent of variance. Finally, ‘trouble
getting asleep’ (0.29), ‘poor appetite’(0.26), and ‘heart pounding/racing’(0.25), have also emerged as the positiveand significant correlates of job stress.The overall psychosomatic problems werealso strongly and positively correlatedwith job stress (0.47 ). Further, job stresshas predicted 17 percent of variance in‘spells of dizziness’, 15 percent in‘sweating hands’. Finally, stress hasexplained 24 percent of variance overallpsychosomatic problems of the teachers.
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Thus, stress yielded positive andsignificant correlations with all thepsychosomatic complaints except in caseof trouble staying asleep, difficulty ingetting up and nervousness. In otherothers, stress is the serious determinantof psychosomatic ailments suffered by theteachers in the school.
Thus, the null hypothesis stands rejected,confirming positively that indeedpsychosomatic illnesses are the profoundconsequences of job stress experienced byteachers across different types of schools.This could be because of the fact thatduring most of the working hours, thenature of work demands teachers to workin standing position and lean towards thelearners while attending to theirinstructional needs and learning needs ofthe students. Secondly, they may haveto run from class to class, staff room tothe administrative section including theprincipal’s office inside the school, veryoften, due to the interdependent natureof their work. In addition to this, theymay have to tolerate administrativepressures, work overload, too muchdemanding boss, besides teacher-parentmeetings which are very demanding inthese days.
Findings reported here subscribe to theview that indeed, psychosomaticproblems are the most costlyconsequences of job stress. This view isfounded on the idea that the intense orpersistent stimulation of the stressresponse without sufficient rest orrecovery can result in a host of mentaland physical health problems (Quick andQuick, 1986).
In view of such finding, it is imperativefor educational administrators of these
schools to develop certain pertinentpolicies that will minimize the stress andpsychosomatic problems. Thus, thefollowing aspects like, flexible workingarrangements, retraining schemes,changes in promotion policy, changes inemployee development schemes, aresuggested as organizational strategies toeffectively reduce the deleterious effectsof job stress. More so, there could becollaborative teaching that to a largeextent reduce the stress levels among theteachers since both teachers share theload and also learn from each other.Besides students also will feel joyous tohave two teachers share the instructionalinputs that gives them alternative viewsand styles of instruction. Further,teachers also feel friendly and learn fromeach other to be interdependent and helpeach other in times of difficulties.
In the present days, there are no schoolswith medical facilities that canconcentrate on preventive medicine sinceit does not fall in the primary obligationsof the school. In view of the phrase,“health organizations are run by healthypeople”, schools in these days shouldrelook into the development of a healthpolicy that includes both teaching, non-teaching staff and the students. In thewake of implementation of such policy,the unnecessary hassles of addressingsick leaves, absenteeism, and teacherturnover could be avoided verysignificantly, besides, healthy teacherswill provide uncompromising quality oflearning opportunities to their studentsand that consequently improve theperformance of the school by and largecontributing to the overall effectivenessof the schools.
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Conclusion
Despite the harmful effects of stressresulting in lowered productivity, poorhealth and organizational effectiveness,the problems of stress in modern learningorganizations have been eitherunaddressed or lip-serviced, though thecost of stress runs into crores of rupeesfor Indian organizations directly orindirectly. More specifically, the schoolsin these days, have grossly ignored themental and physical health of the teachersspecifically because of being myopic intheir administrative routines. Whileaddressing the need for research on therelationships between job stress andpsychosomatic problems, this studybrought to light certain glaring resultsthat pain in back/spine, spells ofdizziness, sweating hands andtiresomeness as the strongest outcomesof job stress on one hand and troublegetting to sleep, poor appetite and heartpounding/racing as significant outcomesof job stress on the other. Thus, all thenull hypotheses have been rejected,indicating that job stress experiences ofthe teachers are not uniform acrossvarious types of schools and on the otherhand, job stress does cause psychosomaticproblems in school teachers.Implications for education administratorsin schools for effectively design policiesthat will defend the teachers against theharmful consequences of job stress aresuggested.
References
Ashforth, B.E., and Lee, T.R. (1990).Defensive Behaviors in Organizations: APreliminary Model. Human Relations,43, 621-48.
Brief, (1981). Organizational Stressors:Managing Job Stress: Boston: LittleBrown.
Bowers, H.C.III, Eicher, K., and Sacks,A.L. (1983). Reducing stress in studentteachers. Teacher Educator, 19(2), 19-24.
David, M.J., and Cooper, C.L. (1984).Occupational Stress in Female Managers:A Comparative Study. Journal ofManagement Studies, 21, 2, 185-205.
Greenhaus, H.J., and Parasuraman, S.(1984). A Work-Noun work InteractionPerspective of Stress and itsConsequences. Journal of OrganizationalBehavior Management, 37-60.
Greer, J.G., and Greer, B.B. (1992).Stopping burnout before it starts:Prevention measures at the pre-servicelevel. Teacher Education and SpecialEducation, 15(3), 168-174.
Ivancevich, J.M., and Matteson, M.T.(1980). Stress and Work: Glenview, III:Scott, Foresman.
Jamal, M. (1985). Relationships of JobStress to Job Performance: A Study ofManagers and Blue Collar Workers,Human Relations. 38, 5, 409-24.
Jick, T.D., and Payne, R. (1980). Stressat Work Exchange, 3, 50-56.
Kanungo, R.N and Menon, S.T ,( 2004).Measurement ManagerialResourcefulness: The Construct and Its,Journal of Entrepreneurship, 13: 129
Khan, R.L., (1983). Work and Health.New York: John Wiley.
Maslach, C. (1976). Burnout: A SocialPsychological Analysis, Human Behavior.5, 16-22.
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McGrath, J.E. (1976). Stress andBehavior in Organizations, in M.D.Dunnette (ed.) Handbook of Industrialand Organizational Psychology. Chicago:Rand McNally.
Morris, G.W., and Morris, J.E. (1980).Stress in student teaching. Action inTeacher Education, 2(4), 57-62.
Motowidlo. ((1986). Occupational Stress:Its Causes and Consequences for JobPerformances. Journal of AppliedPsychology and Soci8al Research, 72, 2,129-35.
Naughton, J.T (1988). Jobs whichaugment or deplete human energy, socialscience research, 72, 2.
Natvig, G.K., Albrektsen, G., Anderssen,N. and Qvarnstrøm, U. (1999). School-related stress and psychosomaticsymptoms among school adolescents.Journal of School Health 69(9), 362-368.4.
Okulicz-Kozaryn K. and Borucka, A.(2004). Diagnosing mental health ofadolescents on the basis of theirsubjective assessments. Medycyna WiekuRozwojowego, 8, 499-512.
Piko, B. and Noemi, K. (2006).Psychosomatic symptom formation as ahealth status indicator in earlyadolescence: Behavioral epidemiologicanalysis. Orvosi Hetilap, 7, 819-825.
Parker, D.F., and DeCotiis, T.A. (1983).Organizational Determinants of Job
Stress, Organizational Behavior andHuman Performance. 32, 160-77.
Prasad, (1991). Immediate JobEnvironment of Nurses, ManagementLabour Studies, 16, 3, 147-58.
Quick, J.C., and Quick J.D. (1984).Organizational Stress and PreventiveManagement. New York: McGraw HillInc.
Quick, J.D., Horn, S.R. and Quick, J.C.(1986). Health Consequences of Stress.Journal of Organizational BehaviorManagement. 8, 2, 19-33.
Sekaran, U., (1994). OrganizationalBehavior. Text and Cases. New Delhi:Tata McGraw Hill
Sharma and Shukla. (1993).Differentiation Model of Stress AffectingIndian Mental Health. Indian Journal ofPsychology, 68, 53-60.
Tanaka, H., Mollborg, P., Terashima, S.and Borres, M. P. (2005). Comparisonbetween Japanese and Swedishschoolchildren in regards to physicalsymptoms and psychiatric complaints.Acta Paediatrica, 94, 1661-1666.
Author:
Meena Dorathi, Faculty Member,Centre for Research and DevelopmentConcerns, Old Alwal, Secunderabad, 500010. [email protected]
#MJSSIM 2 (II) 05, 2010
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Introduction
The Industrial Relations Scenario (IRS)of an economy is largely dependant onthe State policy, employer’s strategy andtrade union’s roles. All these three actorsconstitute IR tripod. Any change in theactivities of the actor/s alters thedynamics of industrial relations.
It also gets influenced by the changes inthe international policy. All these changesgive rise to a new picture of industrialrelations.
This study portrays the emergingscenario of industrial relations in Orissa.Many studies have been conducted ondifferent dimensions of trade unionism,management strategy, impact ofglobalization on IR and in allied areas.But overall studies on the emergingpattern of industrial relations at a Statelevel are few and far between. Somestudies undertaken by D.V.Giri (2003),
Venkat Ratnam (2000, 2001) areexception to it. Therefore, it is essentialto undertake such studies from a broaderperspective. Such studies shall giveguidelines to employers, unions andworkers. It shall also influence the policy-makers. It gives the justification forundertaking this study.
The data for the study have been collectedfrom a cross section of managers of HR/Personnel Department of Public, Privateand Co-operative sector establishments,Conciliation Officers of the LabourDirectorate of Orissa, trade unionmembers, key leaders of federationsfunctioning in the State. Differentjournals, magazines, union records andfiles, relevant publications of industries,Office of the Labour Commissioner,Labour Statistics Report, The EconomicSurvey of Orissa have been referred. Thedata is taken from 1990 to 2004.
Emerging Scenario of Industrial Relations in Orissa
Sitansu Panda
Abstract
The State of Orissa is endowed with vast natural resources. It has been the centre of attraction forforeign investment. However, the growth of the State is not encouraging. In this context, this papergives an outline to the emerging scenario of industrial relations which is a vital aspect of an economy.It is observed that many Public Sector Undertakings are in a moribund state. Some of them havebeen referred to BIFR. Many small scale units have been closed down prematurely due to industrialsickness. Though the region is rich with natural resources, yet; it has not industrially developed tothe fuller extent. Secondly, it reflects that most industries have downsized their manpower as asequel to globalization. Deployment of contract labour in the non-core activities of industries hasgiven rise to a new pattern of employment relationship. Contract labour constitutes a sizeable amountof the labour force which gets equally reflected in trade unions. Thirdly, it notices the quantitativegrowth of unions in the post LPG period which is contrast to the declining trend of unions in differentcountries. Unions are expanding their tentacles to the unorganized sector. Unions have been afflictedby rivalries, politicization, leadership conflicts and weak finances. These institutions are concernedmore for the macro-level issues than for plant level issues. Majority of the unions in the State areaffiliated to BMS. Many regional and State level federations have emerged in the post-liberalizedperiod. Fourthly, the number of disputes in the state is exhibiting a declining trend
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Before discussing different aspects ofindustrial relations the demographic andeconomic profile of the State is focusedin order to give a backdrop to this study.
Demographic and Economic Profile ofOrissa
Orissa occupies 4.74 % of India’s landmass and 3.58% of the country’spopulation. The population of Orissa is368.05 lakhs as per the 2001 Census. TheState had registered a decennialpopulation growth rate of 16.25% during1991-2001. Nearly 85% of its populationlive in rural areas and mostly depend onagriculture and allied activities for theirlivelihood. The State is endowed withvast mineral resources like coal, iron ore,manganese ore, bauxite, chromites etc.The total labour force in 1991 was 118lakhs. In 2001 this increased to 142.73lakhs, which accounted for about 39%of the total population of the State. Asper the Census report there were 46.87lakhs marginal workers in the Stateconstituting 32.8% of the total workers.Out of 46.87 lakhs marginal workers,8.12 lakhs were cultivators, 29.01 lakhsagricultural workers, and 6.6 lakhs wereother workers. With the increase inpopulation and consequent addition tothe labour force, supply of labourcontinues to outstrip demand resultingunemployment and underemployment.The total backlog of unemployment at theend of 2004-05 was 9.90 lakhs.
The per capita income in the State atconstant prices was estimated at Rs.6555in 2004-05. The Gross State DomesticProduct at constant prices (1993-94) was29,487.94 crores for the same period.
The State Government has set up a
number of undertaking enterprises invarious sectors as power, transport,construction, forestry, fisheries, mineralsand metals, engineering goods. There are67 PSEs out of which only 32 are workingas on 31st March 2004. 14 PSEs haveincurred losses. Many Public SectorEnterprises have been closed downprematurely due to industrial sickness.Some are in a moribund state. Due to poorperformance, these industries have runinto such problems. The poorperformance of these public sectorenterprises have run into financialproblems and require infusion of equitycapital and loans to survive.
Large industries like Rourkela Steel Plant,National Aluminium Company, ParadeepPhosphates Limited, Talcher ThermalPower Plant, National Thermal PowerPlant, Hindalco, Bargarh CementLimited, Ultratech Cement Limited;mainly portray the industrial picture ofthe State. By the end of 2004-05; 83,075small-scale units were set up out of which1688 units were identified as sick byOrissa State Financial -Corporation.
Industrial Policy of the State
The State’s industrial policy (2004-05)has emphasized the development ofindustries with best utilization of thenatural resources and to improve itsfinancial position. Its objectives are: tocreate a business climate conducive forbetter investment in industry; toaccelerate the economic growth andemployment scope in the State.
The Government encourages privateinitiative for the development ofindustries. It promotes its image as anattractive destination for investment and
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tourism. It assumes a proactive role inselected sectors such as mineral-basedindustries, craft-based products, agro- andmarine- based industries, industriesbased on medicinal herbs and minorforest produce, tourism, electronics,information technology andbiotechnology; explore the possibilities ofsetting up Special Economic Zones.
Industrial Relations Scenario
To reflect the emerging scenario ofindustrial relations in Orissa, thefollowing four aspects have been selectedand analyzed as: (1) developments in thetrade union front; (2) role of bureaucracyand Government; (3) managementperspective, and (4) trends in industrialdispute.
Developments in the Trade UnionFront
(i) The post-liberalization periodwitnessed a rising trend in the numberof registered trade unions in Orissa. It isdue to the emergence of a large numberof small size unions in the SSIs, whosenumber has been increasing over theyears. The service sector got moreunionized. Some unions in themanufacturing industries have beenderegistered in the year 2001 due to non-submission of annual returns. Taking1990 as the base year, it is starkly evidentthat in all the years except 2001, anincreasing trend in terms of number ofunions, membership strength andmembership per union is exhibited(Table-1). Except the years; 195, 1997 &2000, rest years have increasingmembership trend. It is interesting tomention that when the post-liberalizationbrought a declining trend in the number
and membership strength of the unionsin different parts of the world (VenkatRatnam, 2003), it shows a growth trendin Orissa. There is a considerable increasein the membership strength andmembership per union in theunorganized sector (Table-2). It is due tothe emergence of service sector unions.The unions namely, Orissa KendupatraKarmachari Sangha and Nikhil UtkalKendupatra Sangha have (7.1 lakhsmembers), Nikhil Orissa Chasi MuliaSangha, Orissa Jungle Shramik Sangha aresome of the leading unorganized sectorunions. The membership strength andnumber of unions shows an inconsistenttrend for the manufacturing sector(Table-3).
It is to be noted that due toimplementation of new managementstrategies in post-LPG period, number ofpermanent labour in different industrieshas reduced. It has given rise to morenumber of contract labours. Oneimportant trend is observed thatconsiderable number of contract labourunions have emerged in the post-liberalization phase. More pertinentlycontract labour unions constitute a majorchunk among the unions in the state. Theindustries namely; Ferrochrme Plant atJajpur Road, Paradeep PhosphatesLimited, Nayagarh Sugar ComplexLimited, Balasore Alloys Limited,Rourkela Steel Plant, Indian Farmers andFertilizer Cooperative Limited atParadeep, Nalco at Angul, Orissa CementLimited at Rajgangpur, Larsen & ToubroLimited at Kansbahal, Tata Sponge IronLimited at Bileipada, Aska Co-operativeLimited in Ganjam, Mangalam TimberProducts Limited at Nawrangpur have
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more number of contract labour unions.
It has been reported that some of theworkers have been disenchanted with theold and established unions, as they couldnot protect the members’ interest in asituation of income and employmentinsecurity caused by large-scale VRS.Therefore, many new unions cropped upduring the period of globalization. It isalso due to the conflict of interestsbetween contract and permanent labourthat brought new unions exclusivelycomprising of contract labour.
The number of unions functioning underthe banner of different federations hasincreased. But it is not encouraging asonly 30% of the total unions are affiliatedunions. Many State and regional levelfederations have emerged during the post-liberalization period. It is due toemergence of different regional politicalparties in Orissa. Among the majorcentral federations, BMS has the highestnumber of unions for the year 2004followed by INTUC. These two are theleading central federations in the State(Table-4). Many independent unionsdeveloped in the post-liberalized period.
A peculiar development in the tradeunion front is that, in the urbanunorganized sector a majority ofworkers engaged in the constructionworks, shops and commercialestablishments, private motor transportoperations have formed their own unionswithout seeking support of centralfederations.
Table 1
No. of Trade Unions Functioning inOrissa and their Membership
(1990-2004)
Year No. of Total MembershipRegd. Claimed PerUnions Membership Union
1990 1121 663857 582
1991 1237 675576 546
1992 1405 800470 570
1993 1447 827821 572
1994 1481 835679 564
1995 1531 835322 546
1996 1626 858866 528
1997 1712 856357 500
1998 1804 952641 544
1999 1884 1243160 689
2000 1884 1535347 815
2001 1771 1565037 884
2002 1796 1607135 894
2003 1819 2192223 1204
2004 1893m 2725959 1434
Source: Compiled from data availablefrom Office of the Labor Commissioner,Government of Orissa.
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(ii) The secret ballot method fordetermining recognition of unions hasbeen widely accepted. The new provisionincorporated in the Trade Unions Act,1926 by the Government of India onJanuary 9, 2002 prohibiting Ministersform becoming office bearers of any tradeunion is being followed in the State. Ithas given scope for the development ofinternal leaders. The industry UltratechCements Limited, Jharsuguda has onlyinternal leaders.
(iii) Trade Union Problems:
Trade unions in the State are beingafflicted by age-long problems likemultiplicity, politicization, rivalries, andweak finances. Some of the cases outlinedin the following paragraphs substantiatethese observations.
Table 2Sector-wise Distribution of Unions in Orissa (1990-2004)
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a) The National AluminiumCompany Case
The NALCO is a public sector unitlocated at Angul which started in1981. Its total workforce strengthis 7414. It is one of the leading fiveexporters of alumina in the worldmarket. It has incurred a profit ofRs. 5909.2 million for the year2004-05. There are thirteen unionsfunctioning in this industry out ofwhich two are affiliated to INTUC.One of these two unions, NationalAluminium Company KarmacharSangha was registered on12.10.1983. Some of members weredissatisfied with the activities of theleaders. The discontented membersleft the union and formed a newone. They did success in gettingaffiliation from INTUC. The
existence of two unionsfunctioning under the samefederation banner clearly shows theunion rivalries.
b) Rourkela Steel Plant
The Rourkela Steel Plant belongsto Steel Authority of India Limited.It is located at Rourkela which isthe industrial hub of Orissa. Itstarted in the year 1953. It hasproduced 88.04 MT of steel andearned a profit of Rs. 108.83 croresfor the year 2003-04. Its manpowerstrength is 27,991. The IR climateis mostly free from major disputes.However, there was dispute duringthe period of secret ballot electionin 2003. Some violent incidentsalso occurred. Sixteen unions arefunctioning in this plant whosetotal claimed membership strength
Table 3Distribution of Unions in Manufacturing Sector of Orissa (1990-2004)
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is 53, 657. The excess number inmembership than the totalworkforce shows the existence ofdouble/multiple membership inunions. It is due to unhealthycompetition among the unions. Itis also reported that the rifts amongthe leaders provide the base for newunions to emerge.
The frivolous membership recordis there in many of the unions inthe state.The competition amongthe unions to increase themembership strengthcompromising the qualitative
development of the members notonly paves the way for creatingrivalries but also makes the unionnon-impressive for the generalpublic.
c) Aska Sugar Co-operativeLimited
This industry is located atNuagaon, Aska in Ganjam district.It started in 1956. It earned a profitof Rs. 2.7 crores for the year 2004-05. Its workforce is 384 whichinclude 172 contract labours. Twounions are functioning in this
Table 4Affiliation Status of Unions to Different Federations (1990-2004)
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industry. Both have affiliationstatus. Aska Co-operative SugarIndustries Employees Union is thefirst union in the plant which wasregistered on 31.8.1964. It washaving both permanent as well ascontract labour as its members. Butdue to the conflict of interests, thecontract labour (members) left thisunion and formed a new union oftheir own in 1997. The contractlabour members did not get supportfor improving status by thepermanent labour. It paved the wayfor the emergence of a secondunion in the plant. It has beenopined by some members that thelack of interest of the front leadersof the permanent labour unioncould not ameliorate the economicstatus of the contract labour. Thiscase reflects the union rivalriesexisting in industries. Suchscenario is exhibited in manyestablishments.
The members contribute Rs. 3/ astheir monthly union subscription.It results weak financial status ofthe unions. The low membershipfees, untimely payment by themembers are the main reasons forthe weak financial status of unions.It is a common feature of almostall unions.
d) Gulf Oil Corporation Limited
This detonator manufacturingindustry is located in Sonaparvat,Rourkela. It was established in theyear 1969. Its annual turnover was110 crores for the year 2004-05. Itsproduction for the same year was
15,315. 51 MT. Its manpowerstrength is around 850. The I.D.LChemical Workers Union wasformed in the 1977. First it gotINTUC affiliation in 1980. But dueto the intra-union rivalries andideological differences among themembers, it withdrew its affiliationstatus from INTUC and now itfunctions as an affiliated unionfunctioning under CITU. Such casefocuses the members beingdisenchanted with the functioningwith some federations.
2. Role of Bureaucracy andGovernment
The official policy of the StateGovernment is to restrict retrenchmentsand to continue the industries. Thebureaucracy has been unable to strictlyadhere to the Government’s policy. In theyear 1991, there were one closure, 11 lay-offs, and 23 retrenchments in the Stateinvolving 4137 workers whose serviceswere terminated. The details of year-wiseterminations from 1991-2004 are givenin Table-5. Different figures show thatthe workers involved in lay-offs, closures& retrenchments are on the decline.
The Government has taken steps toimprove the precarious condition ofPublic Sector- Enterprises afterconsidering the factors such asprofitability and promotional activity.Different strategies were implemented forbetterment of existing 36 PSEs and 20co-operative enterprises. Some PSEs likePPL, Nayagarh Sugar Mill have beenprivatised and some private industrieslike Konark Jute Mills Ltd., OswalFertilizers Ltd., have been changed in its
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ownership. Now these two arefunctioning under State and Co-operativeownership respectively. Restructuringprocess was initiated and terminalbenefits under the voluntary retirementscheme have been implemented. Forimplementation of the reformsprogramme, the State had soughtfinancial support from the Department
for International Development,Government of UK. The StateGovernment has been providing training,counselling to the employees opted forretirement. It has been reported that someof such retired employees have showndiscontentions with the trainingprogramme of Government.
Table 5Lay-offs, Closures and Retrenchments of Workers in Orissa (1991-2004)
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3. Management Perspective
Industries have resorted to differentinnovative management strategies forimproving their economic status. Manycompanies have gone for outsourcing thenon-core activities. Many havedownsized their manpower. This hasserious implications on trade unionism.The workers showed their dissatisfactionthrough unions against downsizingstrategies as these invited unprecedentedchallenges in terms of unemployment anduncertainties.
Contractualization of workforce,restructuring and modernization oftechnology have been emphasized in thepost-liberalization period. It is mainly dueto meet the competitive challenges in themarket.
‘one union in one industry’ situation isprevailing in the industries owned byTatas. Some industries in the State devoidrecognized unions. It is due to ignoranceand intentional delay by management ingiving recognition status. The industriesnamely; ‘Eastern Valve & RegulatorPrivate Limited’, ‘Nayagarh SugarComplex Limited’, IFFCO; do not haverecognized unions.
In some establishments the managementtakes unilateral action in payment of duesto the workers after becoming sick. TheORIND Refractories, a Jhujhunwala unitlocated at Lathikata was shut downtemporarily due to industrial sickness inthe year 2000. Since then themanagement has not paid any heed to thedemands of the unions, workers forpaying their wage dues. It gives a general
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impression that in some industries ofOrissa, various activities of participativemanagement forums are not beingfollowed based on industrial democracy.
Some of the old industries have resortedto operate their activities mostly bycontract labour. The ‘Gulf OilCorporation Limited’ at Rourkela hasreduced its regular workforce. It has ledto dissatisfaction among the regularworkforce.
In some organizations the parties aresigning long-term agreements. TheNALCO falls under this category whichsigned a 10 year agreement w.e.f. 1st
January, 1997.
4. Disposal of Industrial Disputes
At present, there are 105 conciliationofficers working under the LabourDirectorate of Orissa headed by theLabour Commissioner, 4 Deputy LabourCommissioners, 13 Asst. LabourCommissioners, 20 District LabourOfficers and 46 Asst. Labour Officers-spread over 7 Zones and 4 Divisions.There are 3 Labour Courts functioningat Bhubaneswar, Jeypore and Sambalpuralong with two Industrial Tribunals,established at Bhubaneswar andRourkela.
The number of industrial disputes in theState for different periods shows adeclining trend. It is clear from the figuresin Table-6. Employee’s preference formutual agreement on the dispute issuesthan to refer them to labour machineriesis one of the reasons towards this trend.Employees have been realizing that theirfuture is contingent upon the survival ofthe industry. Therefore they co-operate
the employer. The number of strikes hasdecreased (Table-7). The unions havestarted functioning as business partnerswith the employer. The same decliningtrend is equally reflected in terms of lossof man-days. The lock-outs haveincreased on account of the precariouscondition of industries belonging to Co-operative sector and PSEs.
The extent of disposals of disputes byconciliation, adjudication is notencouraging. The delays in conciliationwere more due to pressure tactics playedby the parties. The low percentage (Table-8 & 9) of disposals at the adjudicationlevel was on account of inadequate staffand more time consuming whichnecessarily requires specific attention bythe State Government. The figures in theconcerned table indicate the trend whichis self explanatory. (Table 6,7,8 & 9)
Conclusion
The State is endowed with rich naturalresources. But its economy has notdeveloped at par with its resources. Manyindustrial establishments have becomesick. The Government has taken steps forimproving the condition of thoseindustries. Some industries have beenreferred to BIFR and some have beenperforming better by getting cooperationof the workers and trade unions.
The post-globalized period witnesses aproliferation of unions both in organizedas well as unorganized sector. Theemergence of new political parties in theState, discontentions among the memberswith the existing unions, leadersmonopoly, failure of the unions to protectemployees from ruthless exit policy; allhave given rise to new unions. In the post
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Table 6Industrial Disputes in 1991-2004
Table 7Strikes and Lock-outs in Orissa,1991-2004
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LPG period many independent unionshave emerged. New unions havesplintered out, however, with leastsuccess. Contract labors have become amajor chunk among the unionized laborforce. The unions are afflicted by age-long problems like multiplicity,politicization, rivalries and weakfinances. And their tone & tenacity areon the decline. Unions have beenchanging their activities from micro-levelplant issues to macro-level issues. They
have been more concerned for the macro-level issues like protest againstdisinvestment, proposed labour lawreforms. The Central Government’simposed Disinvestment policy has beenstrongly protested by the workers,unions, federations in the State.
Many industries have resorted torestructuring. Different schemes likeVRS, Friendly Departure Scheme;contractualization of non-core activitieshave been adopted.
Table 8Disposal of Disputes through Conciliation
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The number of disputes in the Stateshows a declining trend. It is due toparties’ realization about the uncertaintysurrounding the outcome of theconciliation/adjudication proceedingsand the delaying tactics adopted by themachinery. The workers apparently haverealized that their survival depends onthe sustenance of the organization.Therefore, the unions ate not findingissues to cross swords with the employers.
References
Das, P. C. (2002), Odissara Shramik
Andolan ‘O’ Silpa Shramik, SunshinePress, Bhunaneswar, Orissa.
Giri, D.V. and P. C. (2003), IndustrialRelations in Orissa: Emerging Scenario,Indian Journal of Labour Economics,Vol.46, No.4.
Labour Statistics in Orissa, 1991, 1993,2003 & 2005.
Murty, B.S. (1986), Profiles of IndianTrade Unions- A Study in Orissa, B.R.Publishing Corporation, Delhi.
Table 9Reference of Disputes for Adjudication, 1991-2004
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Panda, S. (2006), Trade Unions in theAge of Globalization- A Study,Pratibimba, Journal of IMIS, Vol.6, No.2, Bhubaneswar.
Ratnam, C.S. Venkata, (1994), Labourand Unions in a Period of Transition,Friedrich Elbert Stiftung, New Delhi.
Venkata Ratnam, C.S.(2000), Globalization and LabourRelations in South Asia, SagePublications, New Delhi.
Venkata Ratnam, C.S. (2001),Globalization and Labour- ManagementRelations: Dynamics of Change, SagePublications, New Delhi.
_____________________________,
(2003), Negotiated Change:Liberalization, Restructuring andCollective Bargaining, SAGE ResponseBooks, New Delhi.
Sahoo, Chandan Kumar and DebabrataPani (2007), Management of IndustrialDisputes in Orissa: Emerging Scenario,Vol.32, No. 2.
Government of Orissa. Economic Surveyof Orissa, 2005-06.
Author:
Dr. Sitansu Panda, Assoc. Prof, SivaSivani Institute of Management,Secunderabad [email protected]
#MJSSIM 2 (II) 06, 2010
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Introduction
Earlier called as small scale industries thedistinction is made by the new legislationand hence termed micro medium andsmall enterprises (MSME). As per theMicro, Small and Medium EnterprisesDevelopment Act, 2006 which again tooksome cues from the Small and MediumEnterprises Development Bill, 2005, thedefinition of micro, small and mediumenterprises has been done formanufacturing and services sector. Asper the ministry of MSME, given belowis the classification depending oninvestment for manufacturing sector:
a. Micro – Below 25 Lacs
b. Small – Between 25 Lacs and 5Crore
c. Medium – Between 5 Crore and 10
Determinants of Workmen Engagement: A Study in SomeMedium Scale Pharmaceuticals
Shamira Malekar and Kanchi Patel
Abstract
Challenging work, inspiring leadership and flexibility in working and good pay packs are not enoughto retain talent and have a competitive advantage in contemporary business environment. The workenvironment needs to be enthusiastic and lively. Employee engagement (EE) helps the organizationto attain new heights of profits and productivity and reduce attrition. EE facilitates synergy thatcomes from working together and gathering creative ideas that lead to long term organization wealthcreation and is an evidence of EE. The main goal of these studies is to provide a coherent and practicalapproach to EE that is necessary to stay healthy both physically and mentally, think of progression,and enhance individual and collective productivity with identification of the determinants as well.In this case workmen are interviewed and questionnaires are administered. For this study mediumsize pharmaceuticals are considered which involves yearly turnover of five to ten Crores Indian Rupees.The degree of association of EE with the determinants is calculated along with constructing aregression equation to measure EE. This paper aims at constructing clusters based on the scores ofEE, its determinants and other variables for a data of 552 workers and support staff in somepharmaceuticals (age group 20- 29 years). Workmen engagement is critical as it directly affects theturnover of the firm and the results obtained with this study are useful
Crore
The above mentioned data is theinvestment ceiling for Plant andMachinery or Equipment and does notinclude cost of land and building. Khaire(2010) mentioned that there are around12-34 million MSMEs including 1.9million registered ones which are spreadout in India. They may be touching livesof 123.4 millions directly or indirectly,which is roughly 10% of the India’s
population. There is a major share in thegross domestic product (GDP) as MSMEscombined output is roughly 7% of thecountry’s GDP. MSME help in theproviding employment, dispersal ofindustries regionally, significantindustrial growth, enhance traditionalskills and aid diversification. Apart fromeconomic growth, socio economic
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development needs to be facilitated andemployee engagement is one of tools toachieve this aim.
The Indian Pharmaceutical Industry(IPI) today is in the front rank of India’sscience-based industries with wideranging capabilities in the complex fieldof drug manufacture and technology. Ahighly organized sector, the PI isestimated to be worth Rs. 160 billion,growing at about 8 to 9 percent annually.It ranks high in the third world, in termsof technology, quality and range ofmedicines manufactured. From simpleheadache pills to sophisticated antibioticsand complex cardiac compounds, everytype of medicine is now madeindigenously.
Gerster (2010) stated that the IPI is asuccess story providing employment formillions and ensuring that essential drugsat affordable prices are available to thevast population of this sub-continentCore competencies play an important rolein determining the future of many Indianpharmaceutical companies in the postproduct-patent regime after 2005.Employee engagement has emerged as acritical driver of business success intoday’s competitive marketplace. Further,employee engagement can be a decidingfactor in organizational success. Not onlydoes engagement have the potential tosignificantly affect employee retention,productivity and loyalty, it is also a keylink to customer satisfaction, companyreputation and overall stakeholder value.Thus, to gain a competitive edge,organizations are turning to HR to set theagenda for employee engagement andcommitment.
It’s the synergy that comes from peopleworking together and gathering creativeideas that leads to long-term organizationwealth creation. That synergy and aboveand beyond behavior is evidence ofemployee engagement. Lockwood (2001)defined EE as the extent to whichemployees commit to something orsomeone in their organization, how hardthey work and how long they stay as aresult of that commitment. Robinson,Perryman and Hayday (2004) describedEE as a positive attitude held by theemployee towards the organization andits values. An engaged employee is awareof business context, and works withcolleagues to improve performancewithin the job for the benefit of theorganization. The organization mustwork to develop and nurture engagement,which requires a two-way relationshipbetween employer and employee.
In this study, we have considered workersand support staff of medium sizedpharmaceutical companies and studiedthe determinants of Employeeengagement. So the objectives of thestudy are to:
a. To understand the determinants ofemployee engagement
b. To design and develop a tool tomeasure workmen engagement
c. To understand the relationshipbetween workmen engagementand its determinants.
Literature Review
According to Kahn (1990), engagementreflects the extent to which a person ispsychologically present in theperformance of their work roles. It
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involves “the harnessing of organizationmembers’ selves to their work roles; inengagement, people employ and expressthemselves physically, cognitively, andemotionally during role performance”.
Maslach, Schaufelli, and Leiter (2001)assumed that engagement and burnoutare two opposite poles of continuum asmeasured by Maslach Burnout Inventory(MBI). Job demand-resources (JD-R)model given by (Demerouti et al, 2001)divided work environment into demandand resources. Schauffeli, et al, (2002)define engagement as a positive, fulfilling,work-related state of mind that ischaracterized by vigor, dedication, andabsorption. They designed a scale knownas the Utrecht Work Engagement Scale(UWES) that measures vigor, dedicationand absorption.
Treacy (2003) found that high-growthcompanies scores more in employeeengagement score by 20% than low-growth companies. Studies suggest clearconnection between engagement andbusiness performance (Harter et al, 2002;Saks, 2006; Treacy, 2003). May, Gilson,and Harter (2004) investigated Kahn’sthree psychological conditions ofengagement and designed a scale withitem reflecting each of three component.They found meaningfulness; safety andavailability were related to engagement.They further predicted:
• Job enrichment and role fit waspositive predictor ofmeaningfulness.
• Rewarding coworker andsupportive supervisor relationswere positive predictors of safety.
• Adherence to coworker norms andself-consciousness were negativepredictors; and resources availablewere a positive predictor ofpsychological availability, whereasparticipation in outside activitieswas a negative predictor.
Konard (2006) states employeeengagement has three related componenta cognitive, an emotional and behavioralaspect .Cognitive aspect encompassesemployees’ belief about organization, itsleader and working condition. Emotionalaspect concerns how employees feelabout these three factors and havepositive or negative attitude towardsorganization. Finally behavior aspectconsist of effort employee bring to theirwork in the form of extra time, brainpower and energy devoted to the task andthe firm.
Oakley and Alge (2006) view engagementas the degree to which employees bringin or leave out their personal selvesduring work role performance. Despitethe acknowledged importance of havingan engaged workforce (Harter et al, 2002;Oakley, 2005, 2006), several organizationsurvey suggest that number of workforceengaged is quite low (Coffman andGonzalez- Molina, 2002; Towers PerrinGlobal Workforce Study, 2007).
Tower Perrin Global Workforce Study(December 2008) of nearly 90,000employees worldwide revealed that only22% of the US workforce is engaged,66% not engaged and 11% disengaged.According to him engagement is thewillingness and ability to contribute tocompany success, the extent to whichemployees put discretionary effort into
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their work, in the form of extra time,brainpower and energy (Perrin, 2007)
According to Vazirani (2007) employeeengagement is the level of commitmentand involvement an employee hastowards their organization and its values.Often used as synonyms for motivationand retention; engagement is anemployee’s decision to apply hisdiscretionary effort to the goal of theenterprise, to accept those goals as hisown and whole heartedly commit himselfto achieving them. (Fineman and Carter2007) According to 2008 study of Gallup,about 54 % of employees in US are notengaged, 17% are disengaged and only29% are engaged.
Macey and Schneider (2008) frame theconstruct of employee engagement at theindividual level of analysis, whereasmuch of the studies (Hater, Schmidt, andHayes, 2002; Salanova, Agut, and Peiro,2005) are framed and conducted atorganizational level. Macey andSchneider conceptualize engagement asstate, trait and behavioral at theindividual level of analysis.
A state typically conveys the idea ofwithin person variation over periods ofone week of hours or even minutes. Traitconveys the idea of within personstability over period of at least severalweeks or months (Waston and Clark,1984; Weiss and Cropanzano, 1996).
Watson Wyatt Survey research (2009)found that highly engaged employee workin companies with 26% higher revenueper employee ,13 % higher total returnto shareholders over five years and 50 %higher market premium. As perWilkinson (1998) EE is the means or
strategy, by which an organization seeksto build a partnership between theorganization and its employees such that:
• Employees fully understands andis committed to achieve theorganization’s objectives, and
• The organization respects thepersonal aspirations and ambitionsof its employees.
It is seen largely the organization’sresponsibility to create an environmentand culture conducive to this partnership.Hence in this study we have consideredworkmen and support staff as theycontribute to a majority of workforce inan organization. Also their perspectivesdiffer from that of executives andmanagers. As per Vergne (2005) EE is aprocess by which an organizationincreases the intellectual and emotionalcommitment and contribution of itsemployees to achieve superiorperformance. It is all about therelationship between people, their workand their organization. EE has beendescribed as having three components byVergne (2005):
• Cognitive commitment:understanding how to contribute togoals and values, employees’ beliefsabout the company, its leaders andthe workplace culture
• Emotional attachment: to work,organization, and job, howemployees feel about the company,the leaders and their colleagues
• Behavioral outcomes: where peopleinvest discretionary effort or ‘go theextra mile’, the value-addedcomponent reflected in the amount
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of effort employees put into theirwork (for example - brainpower,extra time and energy)
There are a number of committees thatwere formed, namely - Kohli, Kapoor,Gupta, Nayak and Hussain Committee.The focus of the reports submitted bythese Committees was more on financeparadigm of MSEM. But there is hardlyany attempt that has been to understandthe human factor and employeeengagement in MSEM. The study aimsto identify the determinants of EE byadministering a questionnaire to workersand support staff of medium sizedpharmaceutical companies
Definitions of EE
Harter, Schmidt and Hayes (2002)defines employee engagement as ‘theindividual‘s involvement and satisfactionwith as well enthusiasm for work.Schauffeli et. al., (2002) describeengagement as a positive, fulfilling, work-related state of mind that is characterizedby vigor, dedication, and absorption. May,Gilson and Harter (2004) investigatedKahn’s three psychological conditions ofengagement and found meaningfulness;safety and availability were related toengagement. As per Vergne (2005)Employee engagement is a process bywhich an organization increases theintellectual and emotional commitmentand contribution of its employees toachieve superior performance.
Konard (2006) states employeeengagement has three related componenta cognitive, an emotional and behavioralaspect. According to Vazirani (2007)employee engagement is the level ofcommitment and involvement an
employee has towards their organizationand its values.
Macey and Schneider (2008)conceptualize engagement as state, traitand behavioral at the individual level ofanalysis in contrast to organizationallevel concept.
Categories of employee engagement
According to Harter et al (2003) there arethere are different types of workers:
Engaged— “Engaged” employees arebuilders. They want to know the desiredexpectations for their role so they canmeet and exceed them. They’re naturallycurious about their company and theirplace in it. They perform at consistentlyhigh levels. They want to use their talentsand strengths at work every day. Theywork with passion and they driveinnovation and move their organizationforward
Not Engaged—Not-engaged employeestend to concentrate on tasks rather thanthe goals and outcomes they are expectedto accomplish. They want to be told whatto do just so they can do it and say theyhave finished. They focus onaccomplishing tasks vs. achieving anoutcome. Employees who are not-engagedtend to feel their contributions are beingoverlooked, and their potential is notbeing tapped. They often feel this waybecause they don’t have productiverelationships with their managers or withtheir co-workers.
Actively Disengaged—The “activelydisengaged” employees are the “cavedwellers.” They’re “Consistently againstVirtually Everything.” They’re not justunhappy at work; they’re busy acting out
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their unhappiness. They sow seeds ofnegativity at every opportunity. Everyday, actively disengaged workersundermine what their engaged coworkersaccomplish. As workers increasingly relyon each other to generate products andservices, the problems and tensions thatare fostered by actively disengagedworkers can cause great damage to anorganization’s functioning.
Importance of engagement
Engagement is important for managersto cultivate given that disengagement oralienation is central to the problem ofworkers’ lack of commitment andmotivation. Meaningless work is oftenassociated with apathy and detachmentfrom ones works. In such conditions,individuals are thought to be estrangedfrom their selves (Seeman, 1972). OtherResearch using a different resource ofengagement (involvement andenthusiasm) has linked it to suchvariables as employee turnover, customersatisfaction – loyalty, safety and to a lesserdegree, productivity and profitabilitycriteria (Harter, Schnidt and Hayes,2002)
An organization’s capacity to manageemployee engagement is closely relatedto its ability to achieve high performancelevels and superior business results. Someof the advantages of engaged employeesare:
• Engaged employees will stay withthe company, be an advocate of thecompany and its products andservices, and contribute to bottomline business success.
• They will normally perform betterand are more motivated.
• There is a significant link betweenemployee engagement andprofitability.
• They form an emotionalconnection with the company. Thisimpacts their attitude towards thecompany’s clients, and therebyimproves customer satisfaction andservice levels
• It builds passion, commitment andalignment with the organization’sstrategies and goals
• Increases employees’ trust in theorganization
• Creates a sense of loyalty in acompetitive environment
• Provides a high-energy workingenvironment
• Boosts business growth
• Makes the employees effectivebrand ambassadors for thecompany
Employee engagement is driven bya combination of factors. Howevergetting two things right is of centralimportance:
• Defining what the organizationstands for (including its mission,goals and aspirations)
• Aligning and enabling people todeliver their part of this mission(e.g. Communications,performance management, trainingand development, recognition andreward).
Some organizations (such as charitiesworking for an important cause) mighthave a natural head start when it comes
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to engaging their people. But we also findremarkable levels of engagement in othersectors, Especially where leaders haveworked hard to craft a compelling visionand create a culture, systems andinfrastructure that release the talents oftheir people to achieve that vision(Virginia, 2006).
Engagement Determinants
* Task satisfaction - Only a satisfiedemployee can become an engagedemployee. Therefore it is veryessential for an organization to seeto it that the job given to theemployee matches his career goalswhich will make him enjoy hiswork and he would ultimately besatisfied with his job.
* Recognition and reward - Look atemployee benefits andacknowledge the role of incentives.An incentive to reward good workis a tried and test way of boostingstaff morale and enhancingengagement (Derrick Hardman1985). There are a range of tacticsone can employ to ensure yourincentive scheme hits the markwith your workforce such as:Setting realistic targets, selectingthe right rewards for incentiveprogram, communicating thescheme effectively and frequently,have lots of winners and reward allachievers, encouraging sustainedeffort, present awards publicly andevaluate the incentive schemeregularly.
* Resources and support - TheCompany should have a proper pay
system so that the employees aremotivated to work in theorganization. In order to boost hisengagement levels the employeesshould also be provided withcertain benefits andcompensations.
* Job Clarity and Job Security (Goalclarity) –
a. Job Clarity - if expectations are notclear and basic materials andequipment not provided, negativeemotions such as boredom orresentment may result and theemployee may then becomefocused on surviving more thanthinking about how he can help theorganization succeed. Employeesneed to feel that the core values forwhich their companies stand areunambiguous and clear.
• Job Security - The importance ofjob security has become moresignificant during the economicdownturn, with layoffs, pink slipsand hiring freezes becomingeveryday news. Job security is anabstract as well as tangible variablethat everyone seeks duringemployment with a company. Jobstability and medium to long-termjob security ensures you aremotivated enough to be committedto organization. Job security reapsfollowing benefits:
• Stability in Career - Job security isall about seeking a sense of stabilityin personal development, careerprogression and overall careerdevelopment during the course ofemployment at a particular
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organization.
• Performing Best - When striving forjob security, an individual offers hisdedication and commitment to histasks in an organization andfocuses his skills and capabilities onbeing a consistent performer.
• Peace of Mind - A secure and stablejob with the right challenges givespeace of mind to an individual andenables her to devote non officehours to community service,hobbies and other activities.
• Family Commitments – One of themost important reasons everyworker aims for job security is tobe able to provide for his family, beit a growing one or elderly parents.
• Financial Security - A stable jobwith an adequate compensationpackage, financial incentives andother benefits should ideallyprovide medium- to long-termfinancial security.
• Pride and Passion - Passionateemployees work harder, are moreloyal and are more likely to go the‘extra mile’ for the corporation.Such employees are builders. Theywant to know the desiredexpectations for their role so theycan meet and exceed them. They’renaturally curious about theircompany and their place in it. Theyperform at consistently high levels.They want to use their talents andstrengths at work every day. Theywork with passion and they driveinnovation and move theirorganization forward. The
employee engagement levels wouldbe high if their bosses (superiors)provide equal opportunities forgrowth and advancement to all theemployees
• Helping and Caring Team spirit -If the entire organization workstogether by helping each other i.e.all the employees as well as thesupervisors co-ordinate well thanthe employees will be engaged.
• Alliance with Work T and D - Theextent to which employees, bothnew and existing are provided withthe type of orientation and trainingthat promotes their personaldevelopment as well as theircontributions to the organization.This is not just training for the sakeof training, but rather thedevelopment of skills that improvethe contribution of each individualemployee.
• Health and Safety - Researchindicates that the engagementlevels are low if the employee doesnot feel secure while working.Therefore every organizationshould adopt appropriate methodsand systems for the health andsafety of their employees.
Research Design
The design is the structure of anyscientific work. It gives direction andsystematizes the research. The researchdesign that we have used is the causalresearch
Causal Research
If the objective is to determine which
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variable might be causing a certainbehavior, i.e. whether there is a cause andeffect relationship between variables,causal research must be undertaken. Inorder to determine causality, it isimportant to hold the variable that isassumed to cause the change in the othervariable(s) constant and then measurethe changes in the other variable(s). Thistype of research is very complex and theresearcher can never be completelycertain that there are not other factorsinfluencing the causal relationship,especially when dealing with people’sattitudes and motivations. CausalResearch explores the effect of one thingon another and more specifically, theeffect of one variable on another. Theresearch is used to measure what impacta specific change will have on existingnorms and allows market researchers topredict hypothetical scenarios uponwhich a company can base its businessplan.
Sampling design
Sampling is that part of statistical practiceconcerned with the selection of anunbiased or random subset of individualobservations within a population ofindividuals intended to yield someknowledge about the population ofconcern, especially for the purposes ofmaking predictions based on statisticalinference. Sampling is an importantaspect of data collection.
Researchers rarely survey the entirepopulation for two reasons (Ader,Mellenbergh, and Hand, 2008): the costis too high, and the population is dynamicin that the individuals making up thepopulation may change over time. The
three main advantages of sampling arethat the cost is lower, data collection isfaster, and since the data set is smaller itis possible to ensure homogeneity and toimprove the accuracy and quality of thedata. The questionnaire wasadministered to 600 workmen.Considering the inconsistencies incompletion of questionnaires the finalsample size comprised of 552 workmenfrom seven different pharmaceuticals.Purposive quota sampling method wasthe technique utilized for this method.
Analysis
The analysis is done the help of softwareSPSS 11.5
Reliability Assessment Scale
The concept of reliability has been usedto cover several aspects of scoreconsistency. Test reliability indicates theextent to which individual differences intest scores are attributable to “true”differences in the characteristics underconsideration and the extent to whichthey are attributable to chance errors.These errors cannot be avoided orcorrected through improvedmethodology. Cronbach Alpha was foundto be 0.8365
Assessment of the Degree ofAssociation of factors
In order to test the association ofEngagement and its factors a detailed setof statistical analysis was conducted firstbeing a confirmatory Pearson’sCorrelation as seen in Table 4.1.
** Correlation is significant at the 0.01level (2-tailed).
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* Correlation is significant at the 0.05level (2-tailed).
Job Clarity and Job Satisfaction (JC andJS) – Training and Development (T andD)
Health and Safety (H and S)– Rewardsand recognition (R and R)
Helping and Caring Team (H and C)– Pride and Passion (P and P)
There is a range of correlationcoefficients between the factors asdescribed below:
• The degree of relation between jobclarity, job security andengagement is 0.444 which ismoderate.
• The degree of relation betweentraining and development andengagement is 0.809 which is quitehigh.
• The degree of relation betweenhealth and safety and engagementis 0.363which comparatively lower.
• The degree of relation betweenrewards and recognition and
Table 1Correlation of EE and its determinants
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engagement is 0.786which is high.
• The degree of relation between co-operation and teamwork andengagement is 0.812 which is high.
• The degree of relation betweenpride and passion and engagementis 0.573which is at moderate levels.
Tests of Regression
Testing the overall significance ofregression
Regression is the determination of astatistical relationship between two ormore variables. In simple regression,there are only two variables; one variable(defined as independent) is the cause ofthe behavior of another one (defined asdependent variable). Regression
interprets what exists physically i.e. theremust be a physical way in whichindependent variable can affectdependent variable.
As the objective of this study is to identifyand assess the effect of components onengagement, the method of multipleregression analysis has been chosen, asit helps in assessing the individual andthe combined effect of independentvariables (Job Clarity and JobSatisfaction, Training and Development,Health and Safety, Rewards andrecognition, Helping and Caring Team,Pride and Passion) on the dependentvariable (engagement levels.)
a. Predictors: (Constant), JC and JS,
H and S, P and P, H and C Team, Rand R, T and D.
In forward stepwise regression thealgorithm adds one independent variableat a time – which explains most of thevariation in the dependent variable ‘Y’.The next step is of one more variable X2,then rechecking the model to see thatboth variables form a good model. Theprocess continues with addition of a thirdand more variables if it still adds up tothe explanation of ‘Y’ (Nargundkar,2002). The steps used in conducting the
regression analysis on the above sampleare as follows:
Y = A + B1X1 + B2 X2 + B3 X3+ B4 X4
+ B5 X5+ B6 X6 .......... (1)
Y = dependent variable representing theemotional intelligence
B1, B2, B3, B4, B5, B6 and B7 are thecoefficients of the regression equation
Total EE = 1.421+ 0.226 JC and JS +0.226 T and D + 0.338 H and S + 0.240R and R + 0.227H and C + 0.343 P andP ……………………………… (2)
Table 2Regression Test
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X1 = Job Clarity and Job Satisfaction (JCand JS) X2 = Training andDevelopment (T and D)
X3 = Health and Safety (H and S)X4 = Rewards and recognition (R andR)
X5 = Helping and Caring Team (H andC) X6 = Pride and Passion (P andP)
A = Constant term
From the above table 4.2 we can analyzethat the regression co-efficient (r) =0.919, which shows that the components(independent factors) do have asignificant impact on the engagementlevels of the workmen.
Cluster Analysis
Cluster Analysis is a multi-variateprocedure (Nargundkar, 2002) is a groupof similar objects. Cluster analysis is anexploratory data analysis tool for solvingclassification problems. Its object is tosort cases (people, things, events) intogroups, or clusters, so that the degree ofassociation is strong between membersof the same cluster and weak betweenmembers of different clusters. Eachcluster thus describes, in terms of the datacollected, the class to which its membersbelong; and this description may beabstracted through use from theparticular to the general class or type.
Cooper and Schindler (2007) haveidentified five basic steps:
a. Selection of sample to be clustered.
b. Definition of the variables onwhich to measure the objects.
c. Computation of the similarities
through correlation.
d. Selection of mutually exclusiveclusters. e. Cluster comparison
Table 3Final Cluster Centers
Cluster
1 2R and R 15 10Final EE 99 81H and S 13 12T and D 16 12H and C Team 20 15P and P 15 12JC and JS 21 19Experience 3 2Marital Status 1 1Gender 1 1Age Range 3 3Qualification 1 1Position 2 2
Cluster 1.
Table 3 explains that there existshomogeneity in considering the impactof the components mentioned above andthe engagement levels between sampleswith experience of 5-10 years and genderof male employees and in the age rangeof 31-50 years whose qualification is upto SSC.
Cluster 2.
The above table explains that there existshomogeneity in considering the impactof the components mentioned above andthe engagement levels between sampleswith experience of 1-5 years and genderof male employees and in the age range
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of 31-50 years whose qualification is upto SSC.
Conclusion
The level of engagement determineswhether people are productive and staywith the organization— or move to thecompetition. Research highlights that theemployee connection to theorganizational strategy and goals,acknowledgment for work well done, anda culture of learning and developmentfoster high levels of engagement. Withouta workplace environment for employeeengagement, turnover will increase andefficiency will decline, leading to lowcustomer loyalty and decreasedstakeholder value. Ultimately, because thecost of poor employee engagement willbe detrimental to organizational success,it is vital for HR to foster positive,effective people managers along withworkplace policies and practices thatfocus on employee well-being, health andwork / life balance.
Once employee satisfaction is achieved,managers will find comfort knowingemployee engagement is close at hand.Both satisfaction and engagement havedirect effects on customer behavior and,hence, both indirectly influence anorganization’s financial performance.The road to an Engaged Workforceidentified the key drivers of employeesatisfaction: intention to stay, inter-unitcoordination, skill variety and customer-service orientation. The key drivers ofemployee engagement are reduced roleconflict, training, autonomy, andpersonal power. Armed with thisknowledge, each organization mustidentify the most relevant and task-
oriented tools to specifically address roleconflict, training, and more. Managerscan now move one step closer to closingthe gap between employee engagementand financial success.
Scope for further research: There areample opportunities to execute a similarstudy in various geographical locationsof India. This may also validate theresearch findings of the current study.Answers to the following questions aresolicited:
• What is the relationship betweenfirm effectiveness and employeeengagement in different MSMEs?
• What differences exist, if any,between rural MSMEs and urbanMSMEs in the determinants ofemployee engagement?
The results of such research questionsregardless of outcomes may clarifyrelationships for the benefit of bothacademicians and practitioners.
ReferencesAdèr, H. J., Mellenbergh, G. J., and Hand,D. J. (2008), Advising on ResearchMethods: A Consultant’s Companion.Huizen, The Netherlands: Johannes vanKessel.Coffman, C. and G. Gonzalez-Molina(2002), Follow this Path: How theWorld’s Greatest Organizations DriveGrowth by Unleashing Human Potential.New York, NY: Warner Books, Inc.Cooper, D. and Schindler, (2007),Business Research Methods, TataMcgraw Hill, New Delhi, 138 - 170.Demerouti, E., Bakker, A.B., Nachreiner,F., and Schaufeli, W.B. (2001), The JobDemands-Resources Model of Burnout.
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Journal of Applied Psychology, 86, 499-512.Douglas, R. M, Richard, L. G., (2004),The Psychological Conditions ofMeaningfulness Safety and Availabilityand the Engagement of the Human Spiritat Work, Journal of Occupational andOrganizational Psychology, 7, 11-37.Fineman, M., and Carter, S., (2007), SowTalent Management, Reap EmployeeEngagement, International HR journal,22- 25Fox, S, and Spector, P. E., (2004),Emotions in the Work Place – theNeglected Side of Organizational LifeIntroduction, Human ResourceManagement Review, 12, 167 –171.Gerster, R., (2010), Partners inDevelopment - India and Switzerland,Social Science Press, Delhi, 154Harter, J. K., Schmidt, F.L., and Hayes,T. L. (2002), Business-Unit-LevelRelationship between EmployeeSatisfaction, Employee Engagement, andBusiness Outcomes: A Meta-analysis.Journal of Applied Psychology, 87(2),268-279.Harter, K., Frank, L. S. and Corey, L. M.K., (2003), Well-Being in the Workplaceand its Relationships to BusinessOutcomes, Flourishing: the PositivePerson and the Good Life, 205–244.Hulme, V. A., (2006), What Distinguishesthe Best from the Rest, China BusinessReview.Jerry, K. and Emily, K., (2005), At work,Feeling Good Matters, GallupManagement Journal.Junejaj, S., (1998), Small and MediumEnterprises: Challenges andOpportunities, Excel Books, Delhi, 350.
Kahn, W.A. (1990), PsychologicalConditions of Personal Engagement andDisengagement at Work, Academy ofManagement Journal, Vol. 33 (4), pp.692.Khaire, R.B., (2010), Understanding theAwareness of Human Resource Practicesin Nagpur SSIs: An Empirical Study, TheIUP Journal of Management Research,Vol. 7(2), No. 4.Konrad, A.M. (2006), EngagingEmployees through High-InvolvementWork Practices, Ivey Business Journal.Lockwood, Nancy R. (2001), LeveragingEmployee Engagement for CompetitiveAdvantage: HR’s Strategic Role; HRMagazine.Macey, William H. and Schneider, B.(2008), The Meaning of EmployeeEngagement, Industrial andOrganizational Psychology, Volume 1,Issue 1, Pages 3-30.Maslach, C., Schaufeli, W. B., and Leiter,M. P. (2001), Job Burnout. In S. T. Fiske,D. L. Schacter, and C. Zahn-Waxler(Eds.), Annual Review of Psychology,Vol. 52, 397-422.May, D. R., Gilson, R. L., and Harter, L.M. (2004), The Psychological Conditionsof Meaningfulness, Safety, andAvailability and the Engagement of theHuman Spirit at Work. Journal ofOccupational and OrganizationalPsychology, 77, 11-37Nargundkar, R., (2002), MarketingResearch: Text and Cases, Tata Mcgraw-Hill, New Delhi, 31 – 215.Oakley, J. L. (2005), Linking Organiza-tional Characteristics to EmployeeAttitudes and Behavior - A Look at theDownstream Effects on Market Response
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and Financial Performance, Forum farPeople Performance Management andMeasurement, Northwestern University.Oakley, J. L., and Alge, B. J. (2006),Detailing the Drivers of EmployeeEngagement: A Hierarchical Approach.Unpublished Manuscript. PurdueUniversity, West Lafayette, IN.Remus, I., (2004), An ExperiencedSampling Measure of Job Satisfaction andits Relationships with Affectivity, Moodat Work, Job Beliefs and General JobSatisfaction, European Journal of Workand Organizational Psychology, 13(3),367 – 389.Robinson, D. and Sue, H., (2003),Employee Engagement- In BriefLeveraging Employee Engagement forCompetitive Advantage: HR’s StrategicRole, HR Magazine, 1-11.Robinson, D., Perryman, S., and Hayday,S., (2004), The Drivers of EmployeeEngagement, Institute for EmploymentStudies.Saks, A.M., (2006), Multiple Predictorsand Criteria of Job SearchSuccess, Journal of Vocational Behavior,68, 400-415.Salanova, M., Agut, S. and Peiró, J.M.(2005), Linking OrganizationalResources and Work Engagement toEmployee Performance and CustomerLoyalty: The Mediation of ServiceClimate. Psychology, 90, 1217-1227.Seeman, P., (1966), ErythrocyteMembrane Stabilization by LocalAnaesthetics and Tranquilizers.Biochem. Pharmac., 15, 1753-66.Schaufeli, W. B., Bakker, A.B., Schaap, C.,Kladler, A., and Hoogduin, C. A. L.(2002), On the clinical validity of the
Maslach Burnout Inventory and theBurnout Measure. Psychology andHealth, 16, 565-582.Treacy, Michael (2006), Double DigitGrowth.Thurstone, L.L. (1920), The Problem ofMelody, Musical Quarterly, 426 - 429.Vazirani, N., (2007), EmployeeEngagement, SIES College ofManagement Studies, Working PaperSeries.Vergne, S., (2005), Living withAmbiguity, Auxilium Training, 22 -35Virginia A. (2006), What Distinguishesthe Best from the Rest. China BusinessReview.Watson, D., and Clark, L. A. (1984),Negative Affectivity: The disposition toexperience aversive emotional states.Psychological Bulletin, 96, 465-490.Wilkinson, A., (1998), Empowerment:Theory and Practice. Personnel Review27(1), 40–56.Zikmund, W. (2005), Business researchmethods, Thomson Asia, 29 - 75.Authors:Dr. Shamira Malekar, Asst professor,Aruna Manharlal Shah’s Institute ofManagement and Research (AMSIMR),Mumbai. [email protected]/[email protected] Patel, student, 2nd year ofMasters of Management Studies (HRspecialization) Aruna Manharlal ShahInstitute of Management and Research,Ghatkopar, Mumbai.
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Introduction
Healthcare has been transformed inrecent times into a pivotal service sectorindustry and is expanding all over theworld. The growth in the worldwidemarket for health care services wouldmake health care the largest service sectorindustry of the developing worldincluding India. The hospital business isnoted for being a difficult service industryto thrive in. Research reveals the personalnature of the business. The developmentsand innovations in the field of healthcarehave considerably affected the perceptionof quality expected by a large number ofpatients and attendants. Today thesurvivors, in healthcare sector will bethose who provide the best qualityservices to the customers through timelymanagerial decisions and application ofstrategic marketing policies. Big middleclass with paying capacity with demandfor better healthcare emerged very fast.This led to emergence of a new categoryof hospitals in the private and corporate
Case Study
Treatwell Hospital: Annoying Events
U. Devi Prasad
Abstract
The case is about lack of customer focus in healthcare industry. The case narrates a few eventswhich demonstrate absence of internal marketing and patient orientation. Lack of focus on Medicareservices and inadequate attention on customer needs dampen the prospects and opportunities ofhealthcare industry. Human touch and personalized care are the important tenets of success. Patientneeds are drivers for efficient hospital service. Personal contacts of relationships are very importantin healthcare environment. High degree of transparency and accountability are high influencingforces. Patient fears need to be allayed by the doctors. At the core of the business, nursing staff anddoctors represent the establishment. The sympathetic and courteous behavior of hospital staff wouldhave a soothing and lasting effect on the patients and their relatives. An empathetic and proactiveapproach of hospital staff towards patients ensures hospital success.
sector. The corporate hospitals, to a largeextent filled the existing gaps ingovernment and private hospitals. Therise of the patient as a consumer, theintroduction of innovative technologiesand a new breed of entrepreneurialmanagers are all factors behind the scenesof this industrial metamorphosis. Patientsaway from home, often uncertain ofhospital surroundings look for a certainlevel of reassurance and comfort. For themanagement, it is very much a “Peoplebusiness” At the core of the business,hospital employees represents theestablishment. Their proficiency,attention to detail, thoughtfulness andunderstanding go a long way to winrepeat clientele and convert them intoloyal customers, who become their bestadvertisements through word-of-mouthpublicity. Hospitals are the mostimportant element in any health caredelivery system. A hospital plays a majorrole in maintaining and restoring thehealth of the people, in caring for the sickand injured. Preventive health care,
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health related research, and training ofmedical and paramedical staff are thegeneral broad functions of hospital.
Hospital Treat well, known to be one ofthe well equipped hospital in Hyderabadkeeps three broad groups - outpatients,inpatient and emergency services, and allother services such as diagnostic services,nursing services, dietary service,pharmaceutical service, sterilizationsupply management services, linenservices, laundry services etc, aresuggested to be viewed as part of thesebroad groups. Large chunk of inpatientsare of accident and suicidal cases andthese cases are brought to the hospital by108 EMRI (Emergency MedicareResearch Institute) service. 108 EMRIservice has been operated by GVKFoundation- a voluntary organizationwhich possesses vans equipped withmedical facilities. Accident cases andother medical emergency cases can utilizethis service.
The Case
Dr. Kishore a middle-aged dynamicindividual, whose personality inspiredtrust and confidence in people, is theManaging Director of the Hospital whoseposition is first in command followed byExecutive Director Dr. Ravi.
Hospital Treatwell founded in 2001 is acorporate hospital in Hyderabad, A.P.,India. It is located in the suburbs ofHyderabad, a place accessible to thenearby villages with a serene and calmgreen ecosystem healing the health andpoising the mental health of people withits non-polluting environment. It wasestablished as a private limited firm withits own building and infrastructure
spread in a five acre land. The conceiverof the hospital is Dr. Kishore a renowneddoctor of General Medicine, widelyacclaimed as a good doctor with humantouch. The hospital has 100 beds, 20doctors, 50 nurses and 200 othersupporting staff. Right from inception thehospital has not achieved full occupancyrate with which it could not have higherprofits. The hospital could build up goodreputation for cardiovascular, orthopedicand general medicine services inoutpatient category. The hospital has agood track record of outpatients in thesethree divisions. The present performancecan be attributed for the yeoman servicesof three doctors in these three divisions.
The hospital caters to the middle incomeand high income class and has more than70% of occupancy rate even though thehospital is not advertised in any media.The hospital earns a total average of 25%on the entire sales. The inflow ofcustomers is an indication of theirappreciation of the facilities provided.Because of good service and favorablelocation, the hospital is so well-patronized. Regarding patient’sawareness of this hospital friend,relatives, private practitioners and localdoctors are the main sources ofinformation to the patients. It is a policyof the hospital not to turn away patientsin serious condition of any magnitudeand after having initial treatment thehospital shifts such patients to corporatehospital of cities.
Problems that cannot be handled at thelower levels, are non-frequent to largeextents, because Dr. Kishore reliesimplicitly on his able staff to tackle onesituation with tact, understanding and
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efficiency. Five Heads of Departments(HODS)- the Executive Director, thePurchase Manager, the Front OfficeManager, the Intensive Care unit, and theAssistant Executive Manager arerequired to report to him. They, in turn,head a body of 150 staff members, ofwhich 115 are confirmed, most havingover fifteen years of experience. Only 35are of the casual staff category. Dr.Kishore strongly believes the strength ofhospital is proper hiring, training andmotivating all the employees in order toeffectively serve clients (InternalMarketing).
Dr. Kishore is proud of the fact thattogether they form a family unit andfoster a sense of belonging in the hospital.Knowing that the healthcare industry isbasically a “people business”, he believesthat their primary task is to endeavor tomake the hospital a “home away fromhome”. It is usual for hospital personnelto replace bed sheets and pillow coverseveryday, cleaning the room, where theseservices constitute a part of serviceproviders and also undertake little jobsand services not related strictly to theirduty as service-providers-e.g. putting ina word to trace patients, getting patientsand visitors from bus and railway stationto hospital and dropping them at bus andrailway station, trying to make thingeasier for their patients. He recalled aninstance of a patient who had severeundiagnosed disease despite numerousvisits to several other hospitals in thetown. The Chief and Managing DirectorDr. Kishore could diagnose the problemthrough careful observation. The diseaseis cured with the treatment of Dr.Kishore, the parting patient remark was
“Dr. Kishore gave me rebirth andimmensely I am grateful to Dr. Kishore”.
On one other hand Dr. Ravi personallynever mingles with the patients and theirguests though many of whom are familiarfaces at the hospital when he routinelychecks the health of the patients. Henever pays attention on the quality ofMedicare served to the patients and doesnot enquire about the health of thepatients. There was an instance of apatient, whose test was delayed by eighthours though they know the patient wason fasting. Actually the test was supposedto be done in the morning as per theinstruction of duty doctor. But this wasignored by the test performing doctorthus; the treatment could not be initiatedwhich was to be done based on thefindings of the test. This incident irritatedthe patient’s attendant and resorted to aheated argument with the doctors.Subsequently Dr. Kishore took him to thelounge, ordered him a drink and got himtalking. It was then he learnt that theperson (attendant) had a quarrel with hiswife (Attendant’s wife is the daughter ofpatient). The quarrel was that theattendant was not taking proper careabout the patient’s health. He was soupset that his wife called him as aninefficient man. Added to this, the qualityof services also made him feel so irritatedDr. Kishore counseled the patient’sattendant regarding the need to bepsychologically strong for which heoffered certain tips. “One has to play onthe psychology of the patients and haveyour wits about you” was the generalopinion of Dr. Kishore, who admitted thatsometimes they did get patients who
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really tried the patience of the hospitalpersonnel. It required a lot ofcommitment and service orientation,besides a good knowledge of humanpsychology. “Every person likes to feelcomfortable and is happiest when treatedwith personalized care” was one of DrDr. Kishore’s favorite saying to his juniorstaff members during their trainingperiod. Dr. Kishore feels that nursesshould take care to explain what eachmedication meant, and hospital shouldoffer a refreshing departure for patientsthat what patients normally expect.“Having confidence in the healthcareprovider is half the battle won”. Thecomforts and level of attention shouldmatch with those in a five star hotel.
As Dr. Kishore hurried down thecorridor, he could hear a clamor of voicein the general ward and above that, abooming voice that seemed belong tosome imposing personality. The nextmoment he was met by the Dr. Ravi whoapprised him of the situation that seemedto be turning into a crisis. “It’s the oldasthma patient”’ said duty doctor. “thepatient needed Deryphillin for thepresent illness but no response found onadministering. The doctor told him howhis nursing staff had tried with differentmedicines. Again when a new drug wasalso tried, but when there was no quickrelief and the patient exploded in angersaying “Do you call this asthma drug”.The nursing staff trembled as they clearedthe table and went inside to bring anothermedicine, but his brow remained knottedstill, and as third, fourth and fifth drugvarieties were put before him theatmosphere grew tense, with the other
patients realizing that there seemed to bea problem on hand of no meanmagnitude. The nurses scurried back andforth, trying to satisfy the patient, but ofno use. When they found the situationgetting out of hand, a distress call wasmade to summon Dr. Kishore. As Dr.Kishore entered the ward, a sudden hushfell across the room. A glance at thepatient made him recall that this veteranof the agriculture had come to theirhospital the previous year. Heremembered him regaling the patientswho cared to listen, with stories of hissuccess in the agriculture. He alsoconsidered himself a chronic asthmapatient, as Dr. Kishore had heard himboasting of it to the others. He greetedthe patient as he neared the table, “Goodevening Sir, I’m quite sorry for theinconvenience caused to you. Let’s seewhat we can do about it”. A bit mollifiedto have the Managing Director attendingon him, the asthma patient lowered hisvoice, but seemed still unsatisfied.
Key Issues:
1. Healthcare industry relies onpersonalized customer care andunderstanding psychology ofpatients. In the changing businessscenario, patient comfort is seennot as a static but as a dynamicphenomenon. Service quality inhealthcare assumes greatersignificance as it does not solelyrest on efficiency of hospitaloperations rather on human touchwith best personalized attention.
2. Management personnel areextremely careful about word-of-
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mouth publicity and are alert to theslightest hint of dissatisfaction onthe part of the customer. They takeutmost care to diffuse potentialvolatile situations before theyresults in a full blown complaint.Their aim is to satisfy the customerand convert him into a loyal friendof their concerns.
3. Employees are frequently told thatthe “customer is king – he is alwaysright”, but are not given theappropriate training and tools todeal with problem customers.Employees need appropriate copingand problem-solving skills tohandle difficult customers as wellas to cope with their own feelingsin such demanding situations.
Questions
1. What else do you think Dr. Kishorecould have done in this situation?
2. Was it right for the Dr. Ravi to callDr. Kishore in this case at thisjuncture?
3. Analyze the relative strengths andweaknesses of Treat well Hospitaland draw up a suitable marketingprogramme.
4. How can Dr. Kishore transfer hisconcern for quality-consciousnessto the Employees?
Author:
U. Devi Prasad, Assoc. Prof, HyderabadBusiness School, Gitam University,Hyderabad. [email protected]
#MJSSIM 2 (II) 08, 2010
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In today’s world, changes are happeningfaster than ever and this book teaches youeight steps to produce needed change inany group. By using a fable, the authormake is very easy to read andunderstand.
Our Iceberg Is Melting presents aframework for an effective corporatechange initiative through the tale of acolony of Antarctic penguins facing thedanger of global warming. This colonyof penguins will remind you of yourtypical business organization as they takeon the personality traits and demonstratethe leadership skills of many of thecharacters we work with on a regularbasis.
The central character is a particularlyastute middle management EmperorPenguin named Fred who has identifieda major challenge in the reality that theiceberg they call home is melting. His firstobstacle is to convince everyone thatthere is a problem which must be dealtwith.
Fred experiences frustration in having todeal with No-No, the penguin who resistschange, actively and passively. No-No, ofcourse, represents those many people inany organization who are basic blockersto change. Other recognizable
Book Review
Our Iceberg is MeltingReviewer: R. M. Naidu
Authors: John Kotter and Holger Rathgeber
Publisher: Macmillan
personalities include: the naysayers andnitpickers, the innovators and agitators,the leaders and followers. The idea is thateveryone in a group must play a role innavigating change. Fred must convincehis colony’s Leadership Council that hisresearch has discovered that if they don’tmove to another iceberg soon they willsuffer disaster beyond theircomprehension.
They must implement a thoughtful planfor leading their fellow penguins in thecolony through a time of necessary butgut-wrenching change. They quicklydiscover that the central issue is neverstrategy, structure, culture, or systems.Although each of these elements areimportant. The core of the matter isalways about changing behaviors of thoseinvolved.
This is where we are introduced to the“The Eight Step Process of SuccessfulChange.” The following chapters explainthe critical flow of a successful changeeffort as we witness the colony discoverthat change is a never-ending processrather than an ultimate destination.
We, too, must realize that we continue toface many changes such as sales,technology, global competition, profits,ROI, retention, customer service, market
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share, etc. Desirable change is an on-going, never-ending process whichdemands one requirement above allothers: adapt or perish.
This book is a must read for everyonewho manages people at any level andrecognizes the challenges involved withthat responsibility. The eight-step changeprocess is profound and can be appliedto any organizational change effort.
One of the things very good about thisbook is that it showed why it is importantto get all team members buy in beforemaking a change. If everyone is for thechange, it will be so much easier to makebecause you won’t have anyone draggingtheir feet. If there is one person on yourteam who doesn’t agree with the change,they will make it very hard for everyoneelse to move forward. One person reallycan drag the whole team down and canhave such a huge effect on theteam. Always let everyone have their say
and offer suggestions to come up with asolution that everyone is behind. One ofthe thing about this book is that it showedwhy it is important to get all teammembers buy in before making achange. One person really can drag thewhole team down and can have such ahuge effect on the team. Always leteveryone have their say and offersuggestions to come up with a solutionthat everyone is behind.
This particular fable comes to us fromtwo gentlemen who know of what theyspeak. John Kotter is a leadership andchange guru at Harvard Business Schoolwho has authored 11 business bestsellers,and Holger Rathgeber is a highlyrespected modern global manager.
Reviewer: Dr. R. M. Naidu, Assoc.Prof, Siva Sivani Institute ofManagement, [email protected]
#MJSSIM 2 (II) 09, 2010
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Business Stripped Bare! Adventures of aGlobal Entrepreneur, it’s a title which onewould never expect from a business bookbut as everything is very exciting andflamboyant about Richard Branson’spersonality, you see a reflection of thesame even in the title.
Business Stripped Bare is Sir RichardBranson’s personal experiences with thegrowth of the hugely successfulorganization: Virgin Group. It details thechallenges faced by the different groupcompanies, the audacious and brilliantdeals made by the group under thecharismatic leadership of Sir RichardBranson. The building of Virgin MobileUSA, Virgin Blue’s success in Australiaand the stories of how Sir. RichardBranson built eight billion-dollarcompanies from scratch and the setbacksare also discussed without anycamouflaging. Sir Richard Branson’srecruitment strategies, reasons forchoosing certain businesses, how does hemanage crisis’s are among the variousquestions for which you can find answersto in this delightfully entertaining bookpacked with business wisdom in everypage.
According to Richard, hiring the rightkind of people and setting them free togo about their work is the right way ofbuilding an organization. There is aunique analogy of comparing a business
Book Review
Business Stripped BareReviewer: Shahaida P
Author: Richard Branson
Publisher: Virgin Books
to a painting which is so different andrefreshing from all other business booksin the recent past.
Richard Branson breaks the book intochapters: People, Brand, Delivery,Learning from Mistakes and Setback,Innovation, Entrepreneurs andLeadership and Social Responsibility.
People: Find Good People - Set ThemFree: According to Branson, finding greatpeople is much more about looking forattitude, enthusiasm and talent than it isabout looking for skills. He believes inthe ”Small is Beautiful” concept. Thechapter has great insights on hiring forentrepreneurs, Branson advocates smallerbusinesses as they foster greaterinnovation and idea generation, fastercommunication and a friendlier workingenvironment.
Brand: Flying the Flag: Branson is greatbeliever in branding and living the brandand the success of the Virgin brand speaksfor itself. Virgin is one of the mostrecognized and respected brands of theworld and soon it will operate in Spacetoo. It is known more for the experiencesit offers customers than for its variedproducts or services. Fun, humor,publicity and treating their people well –customers and employees alike –characterizes the Virgin Brand. Aftermany great stories and adventures in this
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chapter, Richard Branson talks aboutorganizational structures, corporategovernance and how the bonding powerof the Virgin Brand ties all their diversebusinesses together within a venturecapital (VC) model.
Delivery: Special Delivery. ”We thriveon ideas but our day-to-day business isabout delivery”, ”It’s the attention to detailthat really defines great businessdelivery”, ”Delivery is not just hard work.It’s endless” and ”Protect theDownside” are some of the timeless quotesfrom this chapter.
Learning from Mistakes and Setbacks:Damage Report. Richard dispels thatimage here. He candidly admits how hehas screwed-up in the past and sharessome of the lessons he has learned so we,as readers, might avoid similar errors ormisjudgments.”Never do anything thatmeans you can’t sleep at night”, “It’s alwaysworth getting the contract right in the firstplace” and the seemingly contradictorybut effective: ”Protect your reputation,Don’t be afraid to make mistakes”. There isa detailed description of how Virgin Colaflopped in the US Market. Branson has thehumility to joke about his own brands andsays that Virgin Cola is the Number 1brand in Bangladesh!!!!
Innovation: A Driver forBusiness: Starting with April Fools’jokes he’s pulled, Richard talks aboutcompanies that he finds innovative.Encouraging employees to generate anddevelop new ideas, making changes andcontinual improvements, beingresponsive and flexible are techniques andstrategies he discusses. Asking some ofthe most elementary questions has ledVirgin to effective innovation and
increased customer satisfaction. There isa insight on Vinod Khosla and his beliefin ethanol being the fuel for the nextcentury.
Entrepreneurs and Leadership:Holding on and Letting go: ”You needto honestly gauge your strengths andweaknesses as a leader … and how youinspire and motivate others to cooperatewillingly to get the job done” and ”Goodmanagers are worth their weight in gold”. Inaddition to leadership experiences andlessons learned within Virgin, Richardtalks about leaders who have meant themost to him - notably Nelson Mandelaand Freddie Laker.
Social Responsibility: JustBusiness: describes Virgin’s ”adventuresin the territory where business and makingthe world a bit of a better place, meet”. TheVirgin group’s efforts to combat AIDS inAfrica. “If the oceans of the earth shoulddie- that is, if life in the oceans weresuddenly, somehow to come to an end- itwould be the final as well as the greatestcatastrophe in the troublous of men andthe other animals and plants with whomshares this planet” Branson sharesextensive information about the tragicsituation of global warming and itsimplications.
The book is humorous, insightful,irreverent and honest, in other wordsquintessentially Richard Branson!
Reviewer:
Dr. Shahaida P, Assoc. Prof, Siva SivaniInstitute of Management, Secunderabad,[email protected].
#MJSSIM 2 (II) 10, 2010
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Siva Sivani Institute of Management
S.P Sampathy’s Siva Sivani Institute of Management is promoted by the Siva Sivani Group ofEducational Institutions, which has been running the prestigious and internationallyrenowned Siva Sivani Public Schools for more than four decades. Approved by the All IndiaCouncil for Technical Education, Ministry of Human Resource Development, Governmentof India, New Delhi, Siva Sivani Institute of Management started functioning as an autonomousinstitute in 1992.
Located in Secunderabad, far from the maddening crowd, about 6 Km. from Bowenpally alongthe National Highway No.7, Siva Sivani Institute of Management has an enviable environment- serene, spacious and stupendous. It offers an ideal environment for imparting value- basedmanagement education. The Institute designs and updates courses at any given point of time,even if it is in the middle of an academic year or a term for that matter.
Stalwarts from both the industry and the academia constantly provide inputs for fine tuningthe course curriculum to meet the needs of the industry. SSIM is consistently ranked amongstthe top Business Schools in the country. Currently, SSIM is ranked 35th in the country amongstthe B-Schools of Excellence as per Business Barons Survey March 2009. The other GroupInstitutions are: Siva Sivani Global Centre for HR Excellence, Siva Sivani Institute of GlobalStudies, Siva Sivani Man Management Private Limited and Siva Sivani Degree College.
Siva Sivani Institute of Management offers four PGDM Programmes:
The PGDM (Triple Specialization)
This program prepares a student towards building multifaceted functionality. PGDM (TPS)is designed in such a way that has evolved from the needs of the industry, which is continuallylooking for managers with cross functional skills embedded and supported by IT savvy acumen.
A student of PGDM (TPS) has a major specialization one of Finance/Marketing/HR/Systemalong with one of the specialization art of Finance, Marketing, HR, System, Operations asminor specialization and also elective courses like Finance, Human Resources and Marketing,ERP, electives such as Retail Management, Banking, Event Management, BPO Management,Insurance Management etc.
PGDM (Marketing)
This is a highly specialized two year management programme in Marketing. This programmeis completely tailor made to the requirements of industry with respect to marketing.
PGDM (HR) with IT
This is highly specialized programme in HR along with IT focus. The latest and global conceptsin the area of HR that includes compensation management, Psychometrics HR audit,Negotiating skills, Managing diversity etc.
PGDM (Banking, Insurance, Finance and Allied Services)
This programme encompasses all the finance related areas and we have included Bankingand Insurance sectors as specializations in addition to core Finance. All the latest topics inBankingand insurance have been included and to name the few are Risk management inBanks,Technology management in Banks, Claims management in insurance, Actuarial scienceetc.
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Correspondence:Manuscript and all correspondence has to be addressed toDr. Shahaida, Asst. EditorSiva Sivani Institute of ManagementNH-7, Kompally, Via-Hakimpet,Secunderabad-500014Phones: 040-65457236, 65457237, 040-27165450-54Fax No.040-27165452www.ssim.ac.inManuscript can also be submitted by electronic format via e mail [email protected] & [email protected]
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