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Skills of an Effective Executive


Robert L Katz
3 skills to kill for an exec..          characteristics
                                                                                 Development




                                                               Technical
                                        Interaction              Skills
                                       Inter groups
• Implication                         Understanding
                                        Motivation

                                       Communication                             Creativity
   – Judge on Action not trait          Attitude to self                         Whole view
                                         experiences
                                      Recognize feelings                           Coaching
   – Select on skills not traits or                                              Multi skilling
                                                                                 Enlargement
                                                     Human          Conceptual
      behavior                                                               Involvement in tasks
                                                      Skills          Skills
• Leads to 3 roles
   – Remedial                                                               Conceptual




                                         Intensity
        • Conceptual + technical

   – Maintenance                                                                 Human

        • Human
                                                                                 Technical
   – Innovate
        • Concept + Intergroup
                                                      Low           Level                  Hi
Managing ones boss


• Know the boss                       • Some errors
   –   As a person                         – Info at face value
   –   Goals & principles                  – Assumptions & extrapolations
   –   SWOT                                – No clarification
   –   Work style                     • To build a relationship
• Know yourself                            – compatible work styles
   – Style                                     • Accommodate diffs
   – Dependence                            – Mutual expectations
        • Counter dependence                   • Maintain realism
        • Over Dependence                      • Subordinates problems?
                                           – Flow of information
                                           – Honesty / transparency
                                           – Outcomes
                                               • Good use of time / resources

  Peter Drucker on leadership >> good readers and listeners.
Effects of Fear – Carl R Rogers



• Experiences are…[defense mechanisms]
  – Symbolized [in relation to self]
  – Ignored – no relation to self
  – Denied / distorted – inconsistency




  Gestalt theory >> helps in understanding oneself better ?!
Giving Feedback – Philip G hanson


• Builds impression of              • Issues in feedback
    – Trust care & acceptance           – Indirect VS Direct
• Purpose of feedback                   – Interpretation VS description
    – Individual correction                  • puts person on defensive
    – Group goals                       – Evaluation VS Non Evaluation
                                        – General VS Specific
• Feedback can be                       – Pressure VS Freedom to change
    – Bipolar [2 directional]                • Send feelings and recipient should
    – Uni polar [1 directional]                own resistance to change
                                        – Delayed VS Immediate
                                        – External VS Group Shared
                                             • Then & there, group observes
                                               consistency
                                        – Imposed vs Solicited
                                        – Unmodifiable vs modifiable behavior
                                             • Only on when it can change
                                        – Motivation > Hurt VS Help
Creating a good relationship


1.   Be what you are [congruent]     1.   Let other person be what she is
2.   Be transparent                  2.   Be individual / independent
3.   Feeling for the other person    3.   Do not be threatening
4.   Do not be influenced by your    4.   Abstain from external evaluation
     condition when applying to      5.   Understanding / empathy
     others
5.   Don’t be bound by the past
     while judging
Transaction Analysis 1957 – Eric Berne [1910 – 1970]



• Types of Transaction analysis
   – Structural Analysis
   – Game Analysis
   – Script Analysis
   – TA proper




  Kurt Lewin Father of Organization behavior
Structural Analysis [TA]
3 ego states
• Parent
    – Limits / discipline / traditions / advice / guidance / rules / law
    – TYPES >> Nurturing Parent / Critical Parent
• Adult
    – Logic / Rational / Analysis
• Child
    – Creativity / adaptations / compliance / withdrawal / procrastination / rebellion
    – TYPES >> natural / adapted / Little professor
• Some issues in structures
    – Contamination of ego states leading to
          • Prejudices [parent]
          • Hallucinations Delusions [child]
    – Exclusions
          • Reliance only on 1 ego state
TA Proper
Types
•   Simple
    –   Complementary, Crossed

•   Complex
    –   Angular, Duplex

•   Rules to communication
    1. Complementary transaction leads to open communication
    2. Crossed transaction leads to closure of communication
    3. Transactions can only be predicted in psychological level not social
    4. Value of communication depends on receiver [ summerton – 1988]


                                     Script Analysis is about games people play
TA proper ..continued


                                                                        • Life positions
                       • Strokes [ social recognition
                                                                             – I’m OK you’re OK
                             unit]
                                                                                 • Only conscious position [best]
                             – External / Internal [self]
                                                                             – I’m OK you’re not OK
                             – Positive / Negative
                                                                                 • Misplaced power / superior
                             – Conditional / Un conditional                  – I’m Not OK you’re OK
                             – No strokes [ worst case]                          • Inferiority
                                                     Summerton
                                                                    – I’m Not OK you’re Not OK
UnConditional Stroke




                                                     4 stroke combo
                       +ve                                                       • Worst case / psycho



                       -ve

                              -ve              +ve          Conditional Stroke
Attitudes >                 evaluative statements or judgments concerning people
                                                                         events or objects


                                                             Some principles
•   3 parts to an attitude                          •   Consistency
     –   Cognitive [beliefs]                             –   Seek bw attitude & behavior
     –   Affective [attitudes]                      •   Cognitive dissonance
     –   Behavioral [behavior]                           –   Inconsistency bw A & B
•   Common Attitudes in management                       –   Elements of dissonance
     –   Job satisfaction                                –   Degree of influence– elements
     –   Job involvement                                 –   Reward with dissonance
     –   Organization commitment                    •   Self perception Theory
•   Acquiring Attitude                                   –   Attitudes can be used to make sense out
     –   Modeling                                            of action
     –   Reward and punishment                           –   B-> A is stronger than A -> B
     –   Early exposure                             •   Attitude surveys
     –   Personality                                     –   Help understand stance of people towards
                                                             objects.

                            Lyndon Johnson – Vietnam War [Escalation of commitment]
Perception >       interpretation of situations


     Sub steps of perception                        Perceptual Organization
Stimulus
Registration                  Overt Behavior    Figure Ground >> perceived
                 Leads to
Interpretation                Covert Behavior   objects stand out from background
Feedback
                                                Perceptual Group
                                                •Closure [gestalt] > perceiving as a
     Perceptual Selectivity
                                                whole
 Subliminal perception – below the threshold    •Continuity – things in continuum
 Factors that effect selectivity are            •Proximity – imparting closeness
   External      Size
                                                Perceptual constancy >> stability
   Internal      Contrast
                                                results from a pattern of cues
   Intensity     Repetition
   Novelty       Motion
                                                Perceptual context >> The
   Familiarity                                  situation
   Perceptual set
   Motivation
   Learning > expectancy to perceive
   Personality > Age & time frame
Perception >       interpretation of situations


  What leads to perception
Needs             Trained Incapacity              Perceptual Defense
Interests         Beliefs
Tendencies        Mental set [expectations]   Happens againt threats,
[self concepts]                               unacceptable explanation ,
                                              inconsistencies

                                              Emotionally disturbing information
                                              >> Has high threshold of
  Biases in perception
                                              recognition
HALO >> one characteristic
Doppel Ganger >> similar characteristics      Disturbing information / stimuli >>
Stereotypes > grouping                        substitute perception
Projections >> Ourselves onto others
Defense >> when there is Inconsistency &      Emotionally arousing information
threat                                        >> Leads to directed behavior
Motivational Theories


• Need >> Zimbardo 1979                        • Maslows hierarchy of needs
    – Biological psychological motive          • Re inforcement Theory [
      condition serves to direct individual
                                                 thorndike - How effect]
      towards a goal
• Definition >>                                • Ahievement / affiliation Power –
    – Social or psychological condition that
                                                 Mc Lelland
    – Willingness to exert effort towards      • ERG Theory
      some goals objectives                    • Mc Gregors - Theory X & Theory
• Unsatisfied needs arte motivators              Y
  and vice versa                               • Victor Vrooms Theory >
• Increase thresholds of needs to                expectancy
  retain motivation                            • Adams equity theory
                                               • Goal Setting theory
Maslows hierarchy of needs


• Maslows hierarchy of needs                            Variation in
   – Akin to 7 chakra model of hinduism                 Maslows theory
• There are 6 levels of needs                           Self actualization
   – Physiological / safety / social / esteem / self    may not arise
     actualization
                                                        Higher needs
• Some rules                                            activated without
   – Lowers need satisfaction leads to higher level     lower level needs
     needs
   – Fixity of hierarchy of needs
   – Relative satisfaction
   – Importance of gratification > seed need is not a
     motivator
Achievement Power Affiliation

• Proposed by Mc Lelland
    – Related to managerial effectives [n]
• Achievement [task oriented]                               Need for knowledge
                                                               •Search for meaning
    – Excel; succeed; challenges; evaluation; personal
                                                               •Cognitive >> desire to
      credit
                                                               know
• Power                                                        •Conative >> desire to
    – Dominate; influence command ones way; in-                understand
      charge status prestige influence delegation
                                                            3 levels of learning
• Affiliation                                                    •Sharavana [effort /
    – Grouping inter-relatedness cooperation                     memorising]
      acceptance                                                 •Manana [mind /
• High N-ach                                                     reflective ]
                                                                 •Dhyana [meditative /
         • Set high but carefully planned goals
                                                                 concepts]
         • Think of alternatives
         • Knowledge of Self
ERG Theory



• Propounded by ALDERFER
• There are levels of needs
   – There is no hierarchy of needs
   – More than 1 level of need at a given time

• Frustration Regression
   – Unfulfilling of certain needs leads to regression into lower levels
Herzberg’s 2 Factor Theory


• Motivators [extrinsic]    • Hygiene factors [intrinsic]
   – Neutral to absence        – Neutral to presence
   – Positive to presence      – Negative to absence

• Responsibility            • Work conditions
• Achievement               • Inter personal relations
• Advancement / Growth      • Super vision
• Challenges                • Salary
• Work                      • Job security
• Recognition               • Admin & policies
McGregors – Theory X & Theory Y



• Theory X – People are     • Theory Y - People are
   – Intrinsically lazy        – Energetic
   – Dislike Work              – Positive to work
   – No creativity             – Love doing new things
   – Little Ambition           – Self motivated

• Need                      • Need
   – Coaxing                   – Facilitation
   – Control                   – Accountability
   – Little Authority          – Delegation
   – Direction                 – Freedom
JS Adams – Equity Theory


• Equity of output to input is
  critical
• Inequity rises when this is in
  imbalance
• Reactions                        Here

   – Change input
   – Change output                 There
   – Change references
   – Quit?                                 Me     Other
Iima notes viramdas qqqq
Wage determination Process

Wage Survey

Equivalence matrix >> Differentials in
hierarchies in companies                          Market
Accuracy of Data [ bias ]                        Conditions
Valuation of Perquisites
                                                Local Wages
                Job Analysis
                                                                  Wage Survey



               Job Description           Job Evaluation          Job Wage level

              Job Specification          Gradation of jobs



        Performance               Performance                 Payment to           Pay
         Standards                 Appraisal                   Employee           System
Kurt Lewin Father of
Organization behavior                                    Change Management


• Conflict Management                             • Force field analysis
         – Monitoring / Facilitating /               – Kurt Lewin
             Autonomy                                – Systems are in eqilibrium of
         – Expert Approach                              opposing forces
         – Facilitator Approach                      – Increase “FOR” forces

• GE Change acceleration                             – Decrease “ANTI” forces

         – Unfreezing – Moving – Re-              • Mutual Identification
             freezing                                – Open Trusting Communication
      Hi                                             – Commonality of objectives
  Learning




                                                     – Indifferent / Common / Oppose
                                    Hi
                Level of differences / conflict
Decision Making Framework
Hi


                            STRUCTURED
Understanding / Knowledge


                            UNSTRUCTURED




                                           RATIONAL                    POLITICAL


                                                      Goal Consensus               Hi
Jo Hari Window
Joseph Luft & Harry Ingham 4 zones



                       Others know me
                                        Yes     BLINDS               PUBLIC ARENA




                                        No    UNKNOWN DARK          PRIVATE FACADE



Big Façade >> Interviewer
Big Blinds >> Over confidence /
                                                No       I know Myself     Yes
Un responsive
Big Public >> Open
Big Dark >> Closed
Feedback >>                  my feelings about your behavior

    Giving Feedback                                  Receiving Feedback
•   Persons behavior VS himself                      • Elicit and wait
     –   Focus on behavior
     –   Don’t evaluate or judge                     • Listen carefully
•   Controllable vs uncontrollable
                                                     • Self analyze
•   Specific vs general
•   Based on Data vs Impressionistic                    – Don’t be defensive

•   Timely vs Late                                      – Don’t rationalize
     –   Receptiveness / respond rather than react
         /
                                                     • Clarify
•   Suggestive vs Prescriptive                          – Don’t make assumptions
•   Positive Intent vs Negative Intent
     –   People can get defensive
Market Signals >>               action by competition that gives indication of intent or
                                                                               internal situation




• Prior Announcements                           • Divergence from goals
    – Pre-empting | threats |                   • Announcing results
       communication | internal support |
       test competitors sentiments
                                                • Cross Parry
                                                     – Competitor responds to firm in a
• Public discussion on industry
                                                        different area
    – Make competition work on same
                                                     – Caterpillar entering farm equipment
       assumptions & prevent warfare |
                                                        vs John Deere
       explaining action
                                                     – Fighting Brand | Mr Pibb from Coke
• Divergence from industry                              for Dr peppers
   precedent                                         – Private anti trust suits
Mergers & Acquisitions



• Elbonian investment? [RJR Nabisco]
   – The investor company becomes a fully owned subsidiary

• MBO
   – Ethical issue of why management did not run the outfit as well?
   – MBO opportunities arise when there is a spin off thereby leading to
     chance for increased control by management

• What are the value drivers?
• Need to understand regulations
Mergers & Acquisitions


• Disclosure norms of SEBI
• Substantial Acquisition
• ICI demerger into ICI and Zeneca
• HCL –HP demerger
   – Avoidance of capital gains

• Poison Pill
   – In case of hostile take over, large amount of shares are given at low prices to
     share holders

• Crown Jewels lockup
   – In case of hostile bid / take over, core business are sold to a white knight
M & A Definitions


• Reverse Acquisition
    – Poor perform company becomes the transferee in a merger e.g. HT & BT with CW

• Divestiture
    – Selling and opting out of a business e.g. TOMCO

• De Merger Spin Off
    – Recognize internal value by split & free shares for holders ICI >> ICI Zeneca ….

• Asset Swap
    – Exchange of non core for core and delta is dealt in cash. E.g. HLL & Stepan chemicals

• Joint Ventures
    – Make subsidiary with another competent organization HCL – HP etc..
Modes of Evaluation


• Fee Cash Flows [DCF ] – Standard
   – EBIT [1-T]
   – WACC [ computed for each year ]

• Equity Cash Flows KeL
   – ECF = EAT – Principle repayment == EBIT[1-T] – I[1-T] – Principle payment ==
     EBT[1-T] – principle payment
   – Discounted at leveraged KeL using net CF of interest & principal payments –
     from a pure equity perspective

• Capital cash flows KeU
   – CCF == EBIT [1-T] – I
   – FCF + IT and discounted at Ke un-levered using assets.
   – Interest added back to FCF , cost of un-levered equity
Derivatives

Why Derivatives

  Asymmetric legal conditions
  Avoid transfer of value by internally
  generating funds
  Value of delta Debt capacity


Forward Contract

  Cost of fund should equal the value of stock
  So, F = S e^(rT) if dividends are there then
  F = S e^(rT) –D e^r(T-t)
Strategic Intent


• An objective goal for the firms future strategy
  formulation and implementation
• Chandler > strategy through structure
• Scott >> looked at stages [OB]
• Utter back >> Process innovations
• Hammer >> BPR
• Lawrence and lorsch >> differentiate and you will
  integrate.
S Tilles Strategy Model

              Resource
              Consistency




Internal                                  External
              Goals / Means
Consistency                               Consistency




                  Risk
Strategy Execution

Peter Drucker             H Ansoff   Wait


 Assumptions                                          Forward
                                                      Integration
                    Expand

 Trade offs


                Develop                                    Develop
  Feedback      Markets              Business              Products


   Review



                    Backward                           Diversify
                    Integration             BPR
Venture Capital Funds


• Ideal VC                          •   Ideal Investee
   – 2-3 rounds of funds – belief       1. Industry space and position
   – Network capability                 2. Management Team
   – Active Board participation             1. Experience of the team
       • Corporate governance           3. Family wealth of products
   – Knowledge of the industry          4. Organization structure
                                            1. Clean simple transparent
• Tag along rights
                                        5. Valuation methods
   – Founder cant exit until VC
                                            1. Not more than 1 year
• Mexico syndrome                       6. Co investees? – Angels?
   – VC has rights to change            7. Exit Opportunity
     management if
Knowledge Processing Strategy.

                  Hi
                  Organization




                                 Dispersed - Clusters          Specialist
Knowledge Level


                  Individual




                                 Dispersed - Points                  Guided




                                      Decentralized            Centralized      Hi
                                         Implementation Responsibility
7 Cs of Communication



• Completeness > 5 Ws and H
• Correctness > right languages, facts, figures
• Concise > non repetition, wordy
• Consideration >positive, pleasant, focus on U
• Concreteness > vivid, right facts
• Clarity > quirks , visual, illustration
• Courtesy > sincere, thoughtful appreciative
Business Communication
     78% of time and 67% of effort of a manager are in communication

• SMCR Model by Berlo 1966                    • Shannon Weaver Model
    – Source                                  • Elements
    – Message > Content Encoding                 – Source
      Decoding
                                                 – Transmitter
    – Channel
                                                 – Signal
    – Receiver
                                                 – Receiver
    – Effect > in attitude knowledge
                                                 – Destination
      behavior
    – Feedback
                                              • Communication Misconceptions
• 2 types of situations
                                                 – Is a fringe benefit
    – Homophily > source and receiver are
      similar                                    – Is message sending

    – Heterophily > source and receiver are      – Managers control communication!
      dissimilar
Human Brain


           Left Side - linear   Right Side - simultaneous

Speech                                Emotions
Logic                                 Relations
Language
Communication – assessing the receiver



• How will receiver benefit
• What is the receivers status and standing
• What is the receivers level of knowledge – language /
  context / facts
• Receivers interests and concerns
• Receivers context and environment
• Secondary receivers ?
Communication - Perspectives


• What channel?                              • Oral Communication
   – Write                                      – Intra personal > Listening
      • For records, user is busy, facts /         observing
        info, complicated info with             – Interpersonal > Interviewing
        details / costs
                                                – Small group > Meeting
   – Speak
                                                – Multi group > Presentation
      • Interactive, groups, personal,
        relationship building, sensitive
                                                – Public > oration
        matter
Communication – Listening
      45% Listening | 30% Speaking | 16% Reading | 9 % writing

•   5 Activities in Listening                       •   When is listening poor?
     –   Sensing Interpreting Evaluating                 –   Faking attention
         Remembering Responding                          –   Avoiding difficult situation
•   Listening Key concepts                               –   Tolerating distraction
     –   Hearing Perception Discrimination               –   Majoring in minors
         Attention sound isolation language              –   Criticizing speaking style
         Meaning Evaluation Retention Response           –   Wasting time differential
•   4 Types of listening                            •   How to improve listening?
     –   Content | Critical | Empathetic | Active        –   Having Focus
•   4 types of listeners                                 –   Digging > asking more questions
     –   Content | Action Oriented | People              –   Tracking > following & relating
         Oriented | Time oriented                        –   Reflecting | Dampening
                                                         –   Redirecting if there are distractions
                                                         –   Jotting down ideas
                                                         –   Not interrupting
                                                         –   Summarize and evaluate
Non Verbal Communication

                               Proxemics
Types

Body movements – kinesics
Space – Proxemics
Time – Chronemics
Paralanguage                                        < 1.5’
Touch color objects graphics                       intimate
                                                              <4’
Kinesics                                           Personal
                                                                    <12’
                                                   Business /
Facial Eye Contact Gestures                          Social           <12’
Postures                                             Public


                               Para Language

                                Expressions / Quirks like ohs ahs
                                Speed intensity rate pitch
Kinesics in detail [NVC]


• Arms Folded                           • Eyes
    – High tight leans forward >            – Straight look > interest consideration
      resentment / rejection                – Shifty drops eyes > don’t rely
    – Loose low easy + smile ? Jovial       – Looking upwards / rapid blink >
      receptive                               serious but working details
• Shoulders                                 – Raising 1 eye brow > disbelief
    – Slouched / bent down > weak           – Raising 2 eye brow > surprise
                                            – Winking one eye > flirtation
• Hands over eyes > ashamed
                                            – Winking with nod and smile >
• Slapping forehead > forgotten               agreement
• Fingers together in front >           • Drumming fingers >
  confidence
                                        • Foot signals
• Position changes
Interview process

                                        Guidelines

• Phases                                  • Interviewer
   – Warming | Main | Wrap up                 – Plan for | Put interviewee at
                                                 ease | Make purpose clear |
• Types several
                                                 Guide | Let talk | Listen | Record
   – Exchange [info, feelings, exit ]
                                                 | End
   – Evaluation [job, performance]
                                          • Interviewee
   – Persuasion [counsel, persuade]
                                              – Prepare | Proper appearance |
   – Control [discipline, conflict
                                                 show interest | Answer
      resolution]
                                                 completely correctly | Courtesy
20 ways to interview success


1.   Prepare Qs with purpose    1.   Listen ad observe
2.   Scout motto – prepared     2.   Keep eye contact
3.   Jot down main Qs           3.   Don’t fear silences
4.   Ensure no distraction      4.   Have easy right pace
5.   Ease the interviewee       5.   Ask searching questions > be
6.   Take control                    calm and fact driven
7.   Give meeting plan          6.   Don’t psychiatrize
8.   Ask easy simple Qs         7.   Avoid irrelevant references
9.   Speak Clearly              8.   Take notes
10. Achieve goof rapport        9.   Don’t be open ended – TIME
                                10. End interview with esteem and
                                    dignity intact
Meetings & Discussions


• 4 Phases                           • Management todos
   – Forming – orientation info         – Track purpose
   – Storming – conflict argue          – Time Resources
   – Norming – rules emergence          – Motivation cohesion participation
   – Performing –decision majority   • Types
• Advantages                            – Training > orate case simulate
   – Personal Involvement Share         – Panel > expertise listen
   – Cohesion Coordinate                – Sales > experience sharing
   – Use resources experience           – Committee > temp varied
   – Exposure to PIE                    – Task > problems issues
                                        – Command > communication up down
Negotiations


• Prepare                                 • Discussion
   – Goals – priorities | Limitations        – AVOID > interrupting arguing
   – Gather info > Issues personalities        point scoring attacks Blames
      power facts interests inhibitions        being clever Talking Sarcasms

   – Concessions list – trade offs             threats Shouting

   – Strategy > simple flexible              – PRACTICE > Listen | Question |
                                               Ask justification | Non Commital
   – List down tasks
                                               | Test commitment | Seek & give
                                               info
Negotiations


•   Signals                                              •   Bargain
     –   Avoid concessions of hope | Ask to                   –   DO’s > Firm conditional [state] | decide
         elaborate | Respond positive | Test cause                exchange and list them up front | bring
         and evaluate stone walling                               back settled issues | keep unsettled issues
                                                                  linked
•   Propose
                                                              –   DONTS > separate offer from conditions |
     –   Dos > Strong language like we need to … |
                                                                  No “If I …Will u “ | separate issues
         be specific | try and gain response | be
         firm in generals | be flexible in specifics |   •   Close and Agree
         Remedy |                                             –   Formal | Write | List agreement | list
     –   Don’ts > grievance | inconsistence | weak                explanations and interpretations
         language | complain | interrupting                   –   DON’T’s > not summarizing | not recording
•   Package                                                       | Giving concessions in closing moments |
                                                                  Not ending
     –   List down draggers – concessions
         inhibition objections | is there room for
         negotiating concessions | list down
         conditions
Reporting


• Preparation                                  • Introduction [11 elements ]
   – Define problem purpose                        – Authorization Problem Purpose
   – List audience                                   Methodology Sourecs Background
        • Experience knowledge prejudice             Limitation Brief Results Plan of
          Responsibility Type                        presentation Scope Definitions
   – List ideas to include                     • Text
        • Hypothesis conditions top headings
                                                   – WAC
   – Collect material information
                                               • Terminal section
        • Secondary > magazines news
          libraries government docs                – Summary Conclusions
        • Primary > files minutes interviews         Recommendations
          surveys                                  – Appendices References
   – Sort Analyze interpret Results
   – Organize data
   – Prepare Outline
Research Paper


• Working plan                             • Documentation Types
   – Outline                                  – Source Footnotes | Cross
                                                 reference footnotes |
• Prefatory parts
                                                 Explanatory footnotes
   – Title | Cover Design | Title page |
      Letter of authority | Letter of      • Supplements
      transmittal | TOC | Table of            – Bibliographies.
      tables | Abstract Synopsis Exec         – Appendices > support info
      Summary                                 – Glossary > list of special terms
                                              – Index > list key words
Management Accounting


Purpose                                                                     Cost Scraper

Decisions > Make or Buy Accept or                                             Profit
Reject | Resource allocation |
Product Mix                                                                   Other OH




                                                                                             Non Mfturing
                                                                                             Over heads
                                                                              Sales OH
Planning & Control > Costs |
Budgets | Performance evaluation                                              Admin OH
                                                                              Mfting OH




                                                                                                             Full Cost
                                                                                             Manufacturing
Whether Direct /Indirect >>




                                                                                             Over heads
                                                                              InD Labour


                                                          Conversion Cost
significance | Effort of tracing |
ideally more direct costs !          Manufacturing Cost
                                                                              Ind Material
                                                                              D Labour




                                                                                             Prime
                                                                                             Cost
                                                                              D Material
Manacc Thoughts


• ABC – Thorndyke > > multiple                 • Costing Methods
   cost centers                                   – Cost + Models
    – When to aggregate costing [when                 • Fixed fee | Fixed + bonus | Ficed +
                                                         incentive …..
       products spend relatively same times
                                                      • Job Shops | Govt Orders |
       in each center]
                                                      • Full costing > Var + Allocation of fixed
    – Cost center level determines decision
                                                         assets
       making model
                                                  – Market / Value Based
    – Cost centers should be homogenous
                                                      • Price -
       within
                                                      • Assembly –batch shops |
• Joint products & By Products                           Competition – Open
                                                      • Marginal Costing > Sales price | Vars
    – Even materials and labour are
                                                         | Volumes [imp to cover fixed costs ]
       indirect costs [do you see chicken in
       the bone?]
Variance Analysis

                                      Total Variance


           Output Variance                                Input Variance
             Sales Side                                    Budget Side




Price                  Volume                     Price                    Qtty


              Qtty              Mix
                                              Purchase          Qtty              mix

  Mkt Gr              Mkt
                     Share
Variance Analysis .. Contd..



• Inefficiency of control should not be taken on the
  department
• Earlier the variance recognition the better
• Process of control ends with remedials
• Variance bw origin and trace of variance can be used
  as learnings for future
POM II - Diagrams
                                                                                                                              Capacity
                                                       A1


                               Generate Alternatives
             Desired
                                                       A2                       IS it Good       Yes




                                                            Build Model Test
             Design
                                                       A3
                                                       A4
              Gap                                       .                                                                     Factors in
                                                        .                                        No                            capacity
             Current                                    .                                                                     planning
             Design                                    An                       PHASES
                                                                                 IN NPD                         Variability                Inventory




                                                                                                       tp           tu
    Value`




                                                                                                                         tc
                           HP Return Map , Performance
                                Measures for NPD                                                       Q




                                                                                                                         tc
                                                                               Break Even
                                                                                  Time                 Q
                 Time to
                 Market                                                        BE post release
                                                                                                               tu
Investigation
                       Mkt Release                                                    Time
POM II - Diagrams


                                                         6


   Q/P




                                              LTL              UTL




                                            UCL



 ACT     PLAN      Strategic planning



                    Tactical Planning

CHECK    DO
                Operations Plan & Control
                                            LCL
POM II Diagrams


Q*




SS

                                                              Stores                             Production
           Normal Inventory Cycle



S

                  q2         q3                                        P&G Case study
     q1
     r1           r2         r3                          Cross Docking
                                                        enabled through
          Inventory Cycle with period                        CRP
                                                                                 Eliminate NVA
                    Review                                                       Activities in the
                                                                               material flow to retail



                  Factory         Load   Warehouse   Unload        Store         Load       Transport     Retail
POM II
                60
     2                          3              2                            3
          100        100
60                                  60                     100   100
                                         I+1                                    I+2

                70
     4                          5              4                            5
                                                                                                              Where merger
                                                                                                              Takes Place
     60                    60                  60                      60

             1                                               1
                                          Retail




                 DC / WH                                                                                                  Services
                                                                                                  Raw Mttl
     Plant

                                                                                                   Pune                      Spares
                                                                                             Jamshedpur      Telco
                                                                                                Lucknow
                                               End Users




                                                                                      Oils        H.Q.               Warehouse




                                                                                                          Offices
POM II
       Structure                   Operations
                                                   Product Proliferation

Infrastructure                        Activities
     Relations                        Tasks
  Game Plan                                           Short – Product
                                                         lifecycle
                   Service &
                   Delivery
                     Csutomer                      Uncertainty in demand
                     Feedback
                    Distribution
                     Channels
                                                   Inventory & Stockouts
Cost
                                                                                                                               Quality
                                                       Failure




                                   Prevention &
                                   Achievement
                                                                                                 Profits


                                      # of defects                                     Cost Reduction

                                                           Revenue
                                                                               Inventory                               Optimal
   CAPACITY PLANNING                                                                                                  Resource
                                                                                                                     Deployment




                                                                                           Scheduling
                                                                                           Operations
                                                                            JIT




                                                                                                             Strategy &
                                                                 Quality




                                                                                                              Design
                                                                                                               Policy
                                                       Quality                                                              Flexible
                                           Resources




   AGGR PRODN PLAN
                                                       Circles             KANBAN                                           Workers
                                Respect
       MASTER PRODN             for Man
                                                                           Lead Time                                      Standard Ops
         SCHEDULE                                                                             Single piece                 Procedures
                                                       JIDOKA                                    Flow
                   BOM
        MRP      Parts Master                                                                                 Multi-
                                                       Visual Control        Small
                                                                                         Layout              function
                                                                             Lots
                  Inventory       Morale                                                                     workers
                                                                 Improvement in small quantums Gemba Kaizen
Finance
        Corporate
                                                Low incomes where
                      Dividend      High rate
Taxes                                           dividend is not taxed
        Personal
                    Capital Gains   Low Rate     high income class
C        TA        TA
                        Macro Economics
G                  S
     Y
I        YD
                   C
NX

              TR
Sales
                                 Competition                     Consumer                           Environment
                                                  Channel
                 Supply                                     Market
                                  Company                                                   Opportunity
                                                            Segment
                                                                                            Analysis
                                                            Position



              Salesmanship           Presales      Preparation              Introduction
                                                                                                           Canned
                                                                              Handling                   Presentation
              Prospecting              DATA          Approach
                                                                             Objections
                                      Potential       Place                                                 routine
                                     Customer                                Presentation
                                                      Time
                                    Information                                Queries
                                                  Mode of Meeting



                                                                                                                   Market
               Descr      Explore      Causal
                                                                                                            New             Existing
                                                      Management

   In-depth   a              a                                                                          Division – new




                                                                                             New
                                                       Marketing                                                         Product Entry
                                                                                                              BU




                                                                                  Product
                                                       Research
   Surveys                   a           a             Problems



                                                                                             Existing
                                                                                                                           Market
                                                                                                        Market Entry
                                                       Info Needs                                                        Penetration
Experiments                              a
                                                        Sources
Buyer
                      characteristics
                                                                                                                                        Buyer behavior
                                                                                                                                           Mkt share – presence w.r.t largest
                                                                                                                                                      competitor
                                                                                                                                  10X                   1X               1/10X
                      Buyer decision
arket Stimuli                                                Other Stimuli




                                                                                                                           20%
                         process

                                                                                                                                   Shooting stars                  ??
                                                                             Market




                                                                                                         Mkt GRowth
                          Decision
                                                                    New               Existing




                                                                                                                           10%
                                                  New
                                                                Diversification        Prod dev                                         Cash cows                Dogs
                                        Product




                                                                                                                           0%
                                                  Existing




                                                                                        Market
                                                                   Mkt Dev
                                                                                      Penetration                                               Involvement
                                                                                                                                           High                   Low

                                                                                                                                         Complex               Variety




                                                                                                                           High
                                                                                                                                           Car,                seeking




                                                                                                         Differentiation
                                                             Repeat          Client                                                     Electronics             Soap

                                First Time                                                Advocate
                Suspect                                                                                                                 Dissonance
                                                                                                                                          reducing             Habitual

                                                                                                                           Low
                    Prospect                                                                                                               Carpet,             Salt, rice
                                                                Inactive or                    Partner                                  lampshade
                                                               Ex-customer
                      Disqualified
Business strategy
                       OT ANALYSIS
                        Opportunity
                       Hi           Lo




         Lo
                    Ideal BIz   Mature Biz




Threat
              Speculative Biz   Troubled Biz




         Hi

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Iima notes viramdas qqqq

  • 1. Skills of an Effective Executive Robert L Katz
  • 2. 3 skills to kill for an exec.. characteristics Development Technical Interaction Skills Inter groups • Implication Understanding Motivation Communication Creativity – Judge on Action not trait Attitude to self Whole view experiences Recognize feelings Coaching – Select on skills not traits or Multi skilling Enlargement Human Conceptual behavior Involvement in tasks Skills Skills • Leads to 3 roles – Remedial Conceptual Intensity • Conceptual + technical – Maintenance Human • Human Technical – Innovate • Concept + Intergroup Low Level Hi
  • 3. Managing ones boss • Know the boss • Some errors – As a person – Info at face value – Goals & principles – Assumptions & extrapolations – SWOT – No clarification – Work style • To build a relationship • Know yourself – compatible work styles – Style • Accommodate diffs – Dependence – Mutual expectations • Counter dependence • Maintain realism • Over Dependence • Subordinates problems? – Flow of information – Honesty / transparency – Outcomes • Good use of time / resources Peter Drucker on leadership >> good readers and listeners.
  • 4. Effects of Fear – Carl R Rogers • Experiences are…[defense mechanisms] – Symbolized [in relation to self] – Ignored – no relation to self – Denied / distorted – inconsistency Gestalt theory >> helps in understanding oneself better ?!
  • 5. Giving Feedback – Philip G hanson • Builds impression of • Issues in feedback – Trust care & acceptance – Indirect VS Direct • Purpose of feedback – Interpretation VS description – Individual correction • puts person on defensive – Group goals – Evaluation VS Non Evaluation – General VS Specific • Feedback can be – Pressure VS Freedom to change – Bipolar [2 directional] • Send feelings and recipient should – Uni polar [1 directional] own resistance to change – Delayed VS Immediate – External VS Group Shared • Then & there, group observes consistency – Imposed vs Solicited – Unmodifiable vs modifiable behavior • Only on when it can change – Motivation > Hurt VS Help
  • 6. Creating a good relationship 1. Be what you are [congruent] 1. Let other person be what she is 2. Be transparent 2. Be individual / independent 3. Feeling for the other person 3. Do not be threatening 4. Do not be influenced by your 4. Abstain from external evaluation condition when applying to 5. Understanding / empathy others 5. Don’t be bound by the past while judging
  • 7. Transaction Analysis 1957 – Eric Berne [1910 – 1970] • Types of Transaction analysis – Structural Analysis – Game Analysis – Script Analysis – TA proper Kurt Lewin Father of Organization behavior
  • 8. Structural Analysis [TA] 3 ego states • Parent – Limits / discipline / traditions / advice / guidance / rules / law – TYPES >> Nurturing Parent / Critical Parent • Adult – Logic / Rational / Analysis • Child – Creativity / adaptations / compliance / withdrawal / procrastination / rebellion – TYPES >> natural / adapted / Little professor • Some issues in structures – Contamination of ego states leading to • Prejudices [parent] • Hallucinations Delusions [child] – Exclusions • Reliance only on 1 ego state
  • 9. TA Proper Types • Simple – Complementary, Crossed • Complex – Angular, Duplex • Rules to communication 1. Complementary transaction leads to open communication 2. Crossed transaction leads to closure of communication 3. Transactions can only be predicted in psychological level not social 4. Value of communication depends on receiver [ summerton – 1988] Script Analysis is about games people play
  • 10. TA proper ..continued • Life positions • Strokes [ social recognition – I’m OK you’re OK unit] • Only conscious position [best] – External / Internal [self] – I’m OK you’re not OK – Positive / Negative • Misplaced power / superior – Conditional / Un conditional – I’m Not OK you’re OK – No strokes [ worst case] • Inferiority Summerton – I’m Not OK you’re Not OK UnConditional Stroke 4 stroke combo +ve • Worst case / psycho -ve -ve +ve Conditional Stroke
  • 11. Attitudes > evaluative statements or judgments concerning people events or objects Some principles • 3 parts to an attitude • Consistency – Cognitive [beliefs] – Seek bw attitude & behavior – Affective [attitudes] • Cognitive dissonance – Behavioral [behavior] – Inconsistency bw A & B • Common Attitudes in management – Elements of dissonance – Job satisfaction – Degree of influence– elements – Job involvement – Reward with dissonance – Organization commitment • Self perception Theory • Acquiring Attitude – Attitudes can be used to make sense out – Modeling of action – Reward and punishment – B-> A is stronger than A -> B – Early exposure • Attitude surveys – Personality – Help understand stance of people towards objects. Lyndon Johnson – Vietnam War [Escalation of commitment]
  • 12. Perception > interpretation of situations Sub steps of perception Perceptual Organization Stimulus Registration Overt Behavior Figure Ground >> perceived Leads to Interpretation Covert Behavior objects stand out from background Feedback Perceptual Group •Closure [gestalt] > perceiving as a Perceptual Selectivity whole Subliminal perception – below the threshold •Continuity – things in continuum Factors that effect selectivity are •Proximity – imparting closeness External Size Perceptual constancy >> stability Internal Contrast results from a pattern of cues Intensity Repetition Novelty Motion Perceptual context >> The Familiarity situation Perceptual set Motivation Learning > expectancy to perceive Personality > Age & time frame
  • 13. Perception > interpretation of situations What leads to perception Needs Trained Incapacity Perceptual Defense Interests Beliefs Tendencies Mental set [expectations] Happens againt threats, [self concepts] unacceptable explanation , inconsistencies Emotionally disturbing information >> Has high threshold of Biases in perception recognition HALO >> one characteristic Doppel Ganger >> similar characteristics Disturbing information / stimuli >> Stereotypes > grouping substitute perception Projections >> Ourselves onto others Defense >> when there is Inconsistency & Emotionally arousing information threat >> Leads to directed behavior
  • 14. Motivational Theories • Need >> Zimbardo 1979 • Maslows hierarchy of needs – Biological psychological motive • Re inforcement Theory [ condition serves to direct individual thorndike - How effect] towards a goal • Definition >> • Ahievement / affiliation Power – – Social or psychological condition that Mc Lelland – Willingness to exert effort towards • ERG Theory some goals objectives • Mc Gregors - Theory X & Theory • Unsatisfied needs arte motivators Y and vice versa • Victor Vrooms Theory > • Increase thresholds of needs to expectancy retain motivation • Adams equity theory • Goal Setting theory
  • 15. Maslows hierarchy of needs • Maslows hierarchy of needs Variation in – Akin to 7 chakra model of hinduism Maslows theory • There are 6 levels of needs Self actualization – Physiological / safety / social / esteem / self may not arise actualization Higher needs • Some rules activated without – Lowers need satisfaction leads to higher level lower level needs needs – Fixity of hierarchy of needs – Relative satisfaction – Importance of gratification > seed need is not a motivator
  • 16. Achievement Power Affiliation • Proposed by Mc Lelland – Related to managerial effectives [n] • Achievement [task oriented] Need for knowledge •Search for meaning – Excel; succeed; challenges; evaluation; personal •Cognitive >> desire to credit know • Power •Conative >> desire to – Dominate; influence command ones way; in- understand charge status prestige influence delegation 3 levels of learning • Affiliation •Sharavana [effort / – Grouping inter-relatedness cooperation memorising] acceptance •Manana [mind / • High N-ach reflective ] •Dhyana [meditative / • Set high but carefully planned goals concepts] • Think of alternatives • Knowledge of Self
  • 17. ERG Theory • Propounded by ALDERFER • There are levels of needs – There is no hierarchy of needs – More than 1 level of need at a given time • Frustration Regression – Unfulfilling of certain needs leads to regression into lower levels
  • 18. Herzberg’s 2 Factor Theory • Motivators [extrinsic] • Hygiene factors [intrinsic] – Neutral to absence – Neutral to presence – Positive to presence – Negative to absence • Responsibility • Work conditions • Achievement • Inter personal relations • Advancement / Growth • Super vision • Challenges • Salary • Work • Job security • Recognition • Admin & policies
  • 19. McGregors – Theory X & Theory Y • Theory X – People are • Theory Y - People are – Intrinsically lazy – Energetic – Dislike Work – Positive to work – No creativity – Love doing new things – Little Ambition – Self motivated • Need • Need – Coaxing – Facilitation – Control – Accountability – Little Authority – Delegation – Direction – Freedom
  • 20. JS Adams – Equity Theory • Equity of output to input is critical • Inequity rises when this is in imbalance • Reactions Here – Change input – Change output There – Change references – Quit? Me Other
  • 22. Wage determination Process Wage Survey Equivalence matrix >> Differentials in hierarchies in companies Market Accuracy of Data [ bias ] Conditions Valuation of Perquisites Local Wages Job Analysis Wage Survey Job Description Job Evaluation Job Wage level Job Specification Gradation of jobs Performance Performance Payment to Pay Standards Appraisal Employee System
  • 23. Kurt Lewin Father of Organization behavior Change Management • Conflict Management • Force field analysis – Monitoring / Facilitating / – Kurt Lewin Autonomy – Systems are in eqilibrium of – Expert Approach opposing forces – Facilitator Approach – Increase “FOR” forces • GE Change acceleration – Decrease “ANTI” forces – Unfreezing – Moving – Re- • Mutual Identification freezing – Open Trusting Communication Hi – Commonality of objectives Learning – Indifferent / Common / Oppose Hi Level of differences / conflict
  • 24. Decision Making Framework Hi STRUCTURED Understanding / Knowledge UNSTRUCTURED RATIONAL POLITICAL Goal Consensus Hi
  • 25. Jo Hari Window Joseph Luft & Harry Ingham 4 zones Others know me Yes BLINDS PUBLIC ARENA No UNKNOWN DARK PRIVATE FACADE Big Façade >> Interviewer Big Blinds >> Over confidence / No I know Myself Yes Un responsive Big Public >> Open Big Dark >> Closed
  • 26. Feedback >> my feelings about your behavior Giving Feedback Receiving Feedback • Persons behavior VS himself • Elicit and wait – Focus on behavior – Don’t evaluate or judge • Listen carefully • Controllable vs uncontrollable • Self analyze • Specific vs general • Based on Data vs Impressionistic – Don’t be defensive • Timely vs Late – Don’t rationalize – Receptiveness / respond rather than react / • Clarify • Suggestive vs Prescriptive – Don’t make assumptions • Positive Intent vs Negative Intent – People can get defensive
  • 27. Market Signals >> action by competition that gives indication of intent or internal situation • Prior Announcements • Divergence from goals – Pre-empting | threats | • Announcing results communication | internal support | test competitors sentiments • Cross Parry – Competitor responds to firm in a • Public discussion on industry different area – Make competition work on same – Caterpillar entering farm equipment assumptions & prevent warfare | vs John Deere explaining action – Fighting Brand | Mr Pibb from Coke • Divergence from industry for Dr peppers precedent – Private anti trust suits
  • 28. Mergers & Acquisitions • Elbonian investment? [RJR Nabisco] – The investor company becomes a fully owned subsidiary • MBO – Ethical issue of why management did not run the outfit as well? – MBO opportunities arise when there is a spin off thereby leading to chance for increased control by management • What are the value drivers? • Need to understand regulations
  • 29. Mergers & Acquisitions • Disclosure norms of SEBI • Substantial Acquisition • ICI demerger into ICI and Zeneca • HCL –HP demerger – Avoidance of capital gains • Poison Pill – In case of hostile take over, large amount of shares are given at low prices to share holders • Crown Jewels lockup – In case of hostile bid / take over, core business are sold to a white knight
  • 30. M & A Definitions • Reverse Acquisition – Poor perform company becomes the transferee in a merger e.g. HT & BT with CW • Divestiture – Selling and opting out of a business e.g. TOMCO • De Merger Spin Off – Recognize internal value by split & free shares for holders ICI >> ICI Zeneca …. • Asset Swap – Exchange of non core for core and delta is dealt in cash. E.g. HLL & Stepan chemicals • Joint Ventures – Make subsidiary with another competent organization HCL – HP etc..
  • 31. Modes of Evaluation • Fee Cash Flows [DCF ] – Standard – EBIT [1-T] – WACC [ computed for each year ] • Equity Cash Flows KeL – ECF = EAT – Principle repayment == EBIT[1-T] – I[1-T] – Principle payment == EBT[1-T] – principle payment – Discounted at leveraged KeL using net CF of interest & principal payments – from a pure equity perspective • Capital cash flows KeU – CCF == EBIT [1-T] – I – FCF + IT and discounted at Ke un-levered using assets. – Interest added back to FCF , cost of un-levered equity
  • 32. Derivatives Why Derivatives Asymmetric legal conditions Avoid transfer of value by internally generating funds Value of delta Debt capacity Forward Contract Cost of fund should equal the value of stock So, F = S e^(rT) if dividends are there then F = S e^(rT) –D e^r(T-t)
  • 33. Strategic Intent • An objective goal for the firms future strategy formulation and implementation • Chandler > strategy through structure • Scott >> looked at stages [OB] • Utter back >> Process innovations • Hammer >> BPR • Lawrence and lorsch >> differentiate and you will integrate.
  • 34. S Tilles Strategy Model Resource Consistency Internal External Goals / Means Consistency Consistency Risk
  • 35. Strategy Execution Peter Drucker H Ansoff Wait Assumptions Forward Integration Expand Trade offs Develop Develop Feedback Markets Business Products Review Backward Diversify Integration BPR
  • 36. Venture Capital Funds • Ideal VC • Ideal Investee – 2-3 rounds of funds – belief 1. Industry space and position – Network capability 2. Management Team – Active Board participation 1. Experience of the team • Corporate governance 3. Family wealth of products – Knowledge of the industry 4. Organization structure 1. Clean simple transparent • Tag along rights 5. Valuation methods – Founder cant exit until VC 1. Not more than 1 year • Mexico syndrome 6. Co investees? – Angels? – VC has rights to change 7. Exit Opportunity management if
  • 37. Knowledge Processing Strategy. Hi Organization Dispersed - Clusters Specialist Knowledge Level Individual Dispersed - Points Guided Decentralized Centralized Hi Implementation Responsibility
  • 38. 7 Cs of Communication • Completeness > 5 Ws and H • Correctness > right languages, facts, figures • Concise > non repetition, wordy • Consideration >positive, pleasant, focus on U • Concreteness > vivid, right facts • Clarity > quirks , visual, illustration • Courtesy > sincere, thoughtful appreciative
  • 39. Business Communication 78% of time and 67% of effort of a manager are in communication • SMCR Model by Berlo 1966 • Shannon Weaver Model – Source • Elements – Message > Content Encoding – Source Decoding – Transmitter – Channel – Signal – Receiver – Receiver – Effect > in attitude knowledge – Destination behavior – Feedback • Communication Misconceptions • 2 types of situations – Is a fringe benefit – Homophily > source and receiver are similar – Is message sending – Heterophily > source and receiver are – Managers control communication! dissimilar
  • 40. Human Brain Left Side - linear Right Side - simultaneous Speech Emotions Logic Relations Language
  • 41. Communication – assessing the receiver • How will receiver benefit • What is the receivers status and standing • What is the receivers level of knowledge – language / context / facts • Receivers interests and concerns • Receivers context and environment • Secondary receivers ?
  • 42. Communication - Perspectives • What channel? • Oral Communication – Write – Intra personal > Listening • For records, user is busy, facts / observing info, complicated info with – Interpersonal > Interviewing details / costs – Small group > Meeting – Speak – Multi group > Presentation • Interactive, groups, personal, relationship building, sensitive – Public > oration matter
  • 43. Communication – Listening 45% Listening | 30% Speaking | 16% Reading | 9 % writing • 5 Activities in Listening • When is listening poor? – Sensing Interpreting Evaluating – Faking attention Remembering Responding – Avoiding difficult situation • Listening Key concepts – Tolerating distraction – Hearing Perception Discrimination – Majoring in minors Attention sound isolation language – Criticizing speaking style Meaning Evaluation Retention Response – Wasting time differential • 4 Types of listening • How to improve listening? – Content | Critical | Empathetic | Active – Having Focus • 4 types of listeners – Digging > asking more questions – Content | Action Oriented | People – Tracking > following & relating Oriented | Time oriented – Reflecting | Dampening – Redirecting if there are distractions – Jotting down ideas – Not interrupting – Summarize and evaluate
  • 44. Non Verbal Communication Proxemics Types Body movements – kinesics Space – Proxemics Time – Chronemics Paralanguage < 1.5’ Touch color objects graphics intimate <4’ Kinesics Personal <12’ Business / Facial Eye Contact Gestures Social <12’ Postures Public Para Language Expressions / Quirks like ohs ahs Speed intensity rate pitch
  • 45. Kinesics in detail [NVC] • Arms Folded • Eyes – High tight leans forward > – Straight look > interest consideration resentment / rejection – Shifty drops eyes > don’t rely – Loose low easy + smile ? Jovial – Looking upwards / rapid blink > receptive serious but working details • Shoulders – Raising 1 eye brow > disbelief – Slouched / bent down > weak – Raising 2 eye brow > surprise – Winking one eye > flirtation • Hands over eyes > ashamed – Winking with nod and smile > • Slapping forehead > forgotten agreement • Fingers together in front > • Drumming fingers > confidence • Foot signals • Position changes
  • 46. Interview process Guidelines • Phases • Interviewer – Warming | Main | Wrap up – Plan for | Put interviewee at ease | Make purpose clear | • Types several Guide | Let talk | Listen | Record – Exchange [info, feelings, exit ] | End – Evaluation [job, performance] • Interviewee – Persuasion [counsel, persuade] – Prepare | Proper appearance | – Control [discipline, conflict show interest | Answer resolution] completely correctly | Courtesy
  • 47. 20 ways to interview success 1. Prepare Qs with purpose 1. Listen ad observe 2. Scout motto – prepared 2. Keep eye contact 3. Jot down main Qs 3. Don’t fear silences 4. Ensure no distraction 4. Have easy right pace 5. Ease the interviewee 5. Ask searching questions > be 6. Take control calm and fact driven 7. Give meeting plan 6. Don’t psychiatrize 8. Ask easy simple Qs 7. Avoid irrelevant references 9. Speak Clearly 8. Take notes 10. Achieve goof rapport 9. Don’t be open ended – TIME 10. End interview with esteem and dignity intact
  • 48. Meetings & Discussions • 4 Phases • Management todos – Forming – orientation info – Track purpose – Storming – conflict argue – Time Resources – Norming – rules emergence – Motivation cohesion participation – Performing –decision majority • Types • Advantages – Training > orate case simulate – Personal Involvement Share – Panel > expertise listen – Cohesion Coordinate – Sales > experience sharing – Use resources experience – Committee > temp varied – Exposure to PIE – Task > problems issues – Command > communication up down
  • 49. Negotiations • Prepare • Discussion – Goals – priorities | Limitations – AVOID > interrupting arguing – Gather info > Issues personalities point scoring attacks Blames power facts interests inhibitions being clever Talking Sarcasms – Concessions list – trade offs threats Shouting – Strategy > simple flexible – PRACTICE > Listen | Question | Ask justification | Non Commital – List down tasks | Test commitment | Seek & give info
  • 50. Negotiations • Signals • Bargain – Avoid concessions of hope | Ask to – DO’s > Firm conditional [state] | decide elaborate | Respond positive | Test cause exchange and list them up front | bring and evaluate stone walling back settled issues | keep unsettled issues linked • Propose – DONTS > separate offer from conditions | – Dos > Strong language like we need to … | No “If I …Will u “ | separate issues be specific | try and gain response | be firm in generals | be flexible in specifics | • Close and Agree Remedy | – Formal | Write | List agreement | list – Don’ts > grievance | inconsistence | weak explanations and interpretations language | complain | interrupting – DON’T’s > not summarizing | not recording • Package | Giving concessions in closing moments | Not ending – List down draggers – concessions inhibition objections | is there room for negotiating concessions | list down conditions
  • 51. Reporting • Preparation • Introduction [11 elements ] – Define problem purpose – Authorization Problem Purpose – List audience Methodology Sourecs Background • Experience knowledge prejudice Limitation Brief Results Plan of Responsibility Type presentation Scope Definitions – List ideas to include • Text • Hypothesis conditions top headings – WAC – Collect material information • Terminal section • Secondary > magazines news libraries government docs – Summary Conclusions • Primary > files minutes interviews Recommendations surveys – Appendices References – Sort Analyze interpret Results – Organize data – Prepare Outline
  • 52. Research Paper • Working plan • Documentation Types – Outline – Source Footnotes | Cross reference footnotes | • Prefatory parts Explanatory footnotes – Title | Cover Design | Title page | Letter of authority | Letter of • Supplements transmittal | TOC | Table of – Bibliographies. tables | Abstract Synopsis Exec – Appendices > support info Summary – Glossary > list of special terms – Index > list key words
  • 53. Management Accounting Purpose Cost Scraper Decisions > Make or Buy Accept or Profit Reject | Resource allocation | Product Mix Other OH Non Mfturing Over heads Sales OH Planning & Control > Costs | Budgets | Performance evaluation Admin OH Mfting OH Full Cost Manufacturing Whether Direct /Indirect >> Over heads InD Labour Conversion Cost significance | Effort of tracing | ideally more direct costs ! Manufacturing Cost Ind Material D Labour Prime Cost D Material
  • 54. Manacc Thoughts • ABC – Thorndyke > > multiple • Costing Methods cost centers – Cost + Models – When to aggregate costing [when • Fixed fee | Fixed + bonus | Ficed + incentive ….. products spend relatively same times • Job Shops | Govt Orders | in each center] • Full costing > Var + Allocation of fixed – Cost center level determines decision assets making model – Market / Value Based – Cost centers should be homogenous • Price - within • Assembly –batch shops | • Joint products & By Products Competition – Open • Marginal Costing > Sales price | Vars – Even materials and labour are | Volumes [imp to cover fixed costs ] indirect costs [do you see chicken in the bone?]
  • 55. Variance Analysis Total Variance Output Variance Input Variance Sales Side Budget Side Price Volume Price Qtty Qtty Mix Purchase Qtty mix Mkt Gr Mkt Share
  • 56. Variance Analysis .. Contd.. • Inefficiency of control should not be taken on the department • Earlier the variance recognition the better • Process of control ends with remedials • Variance bw origin and trace of variance can be used as learnings for future
  • 57. POM II - Diagrams Capacity A1 Generate Alternatives Desired A2 IS it Good Yes Build Model Test Design A3 A4 Gap . Factors in . No capacity Current . planning Design An PHASES IN NPD Variability Inventory tp tu Value` tc HP Return Map , Performance Measures for NPD Q tc Break Even Time Q Time to Market BE post release tu Investigation Mkt Release Time
  • 58. POM II - Diagrams 6 Q/P LTL UTL UCL ACT PLAN Strategic planning Tactical Planning CHECK DO Operations Plan & Control LCL
  • 59. POM II Diagrams Q* SS Stores Production Normal Inventory Cycle S q2 q3 P&G Case study q1 r1 r2 r3 Cross Docking enabled through Inventory Cycle with period CRP Eliminate NVA Review Activities in the material flow to retail Factory Load Warehouse Unload Store Load Transport Retail
  • 60. POM II 60 2 3 2 3 100 100 60 60 100 100 I+1 I+2 70 4 5 4 5 Where merger Takes Place 60 60 60 60 1 1 Retail DC / WH Services Raw Mttl Plant Pune Spares Jamshedpur Telco Lucknow End Users Oils H.Q. Warehouse Offices
  • 61. POM II Structure Operations Product Proliferation Infrastructure Activities Relations Tasks Game Plan Short – Product lifecycle Service & Delivery Csutomer Uncertainty in demand Feedback Distribution Channels Inventory & Stockouts
  • 62. Cost Quality Failure Prevention & Achievement Profits # of defects Cost Reduction Revenue Inventory Optimal CAPACITY PLANNING Resource Deployment Scheduling Operations JIT Strategy & Quality Design Policy Quality Flexible Resources AGGR PRODN PLAN Circles KANBAN Workers Respect MASTER PRODN for Man Lead Time Standard Ops SCHEDULE Single piece Procedures JIDOKA Flow BOM MRP Parts Master Multi- Visual Control Small Layout function Lots Inventory Morale workers Improvement in small quantums Gemba Kaizen
  • 63. Finance Corporate Low incomes where Dividend High rate Taxes dividend is not taxed Personal Capital Gains Low Rate high income class
  • 64. C TA TA Macro Economics G S Y I YD C NX TR
  • 65. Sales Competition Consumer Environment Channel Supply Market Company Opportunity Segment Analysis Position Salesmanship Presales Preparation Introduction Canned Handling Presentation Prospecting DATA Approach Objections Potential Place routine Customer Presentation Time Information Queries Mode of Meeting Market Descr Explore Causal New Existing Management In-depth a a Division – new New Marketing Product Entry BU Product Research Surveys a a Problems Existing Market Market Entry Info Needs Penetration Experiments a Sources
  • 66. Buyer characteristics Buyer behavior Mkt share – presence w.r.t largest competitor 10X 1X 1/10X Buyer decision arket Stimuli Other Stimuli 20% process Shooting stars ?? Market Mkt GRowth Decision New Existing 10% New Diversification Prod dev Cash cows Dogs Product 0% Existing Market Mkt Dev Penetration Involvement High Low Complex Variety High Car, seeking Differentiation Repeat Client Electronics Soap First Time Advocate Suspect Dissonance reducing Habitual Low Prospect Carpet, Salt, rice Inactive or Partner lampshade Ex-customer Disqualified
  • 67. Business strategy OT ANALYSIS Opportunity Hi Lo Lo Ideal BIz Mature Biz Threat Speculative Biz Troubled Biz Hi