Epitome jan. 2012

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-THE STUDENT’S JOURNAL
ISSUE- Jan. 2012

VYAKTITVA BIZ NEWS PERSPECTIVES FUN MANIA

JAGAN INSTITUTE OF MANAGEMENT STUDIES, JAIPUR

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Dear all,
Hope our 2011 is great memories for us…
Let’s put our hand together to welcome our 2012,

May this 2012 bring you prosperity and luck in your journey of
life…
Happy a safe travel everyone…!!!

From
Jims, Jaipur

The Student’s Journal
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“Letters to the Editor”
 Dear all,
I want to convey here my best wishes to those who are involved in Epitome.
All their efforts are appreciable and remarkable. Designing and content writing is the focus of this
edition.

Thanks & Regards,
Bharat Sharma (2008-10)

 Dear juniors,
I am so glad to see that you have taken forward our trend of releasing Dossier/Journal. This
will definitely enhance your knowledge and will help you in future also.
My best wishes are with you.

With Regards,
Rahul Mishra (2009-11)

 Hi dear juniors and super juniors,
Nice to see that you once again started the tradition of releasing JIMS Connect to Jims Rocks at:
journal. Went back to our past memories when we used to rush to meet our deadlines in order to release http://www.facebook.com/grou
the journal on time. Nice effort by all of you! Keep it up. ps/108082739272097/
Thanks,
Vikas Kumar Shaw (2009-11) Connect to Jims, Jaipur at:
http://www.facebook.com/page
 Dear all,
First of all congratulations to the PGP-II team for their efforts & launching s/Jagan-Institute-of-
The Student's Journal “Epitome". Management-Studies-
The Designing, content and presentation was excellent and it was just like revision of my PGDM Class! Jaipur/192583660779485
As I am working for SME I learned some good points from the Article "21 hot Branding strategies for
SMEs"
==========================
Regards, Please send your feedback to:
Vikas Verma (2009-11) jimsepitome@gmail.com
Marketing Coordinator ==========================
Ensol Multiclean Equipments Pvt. Ltd.

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Content

Editor's Note
Faculty Speaks- Ms. Pooja Kudesia,
Asst. professor, Jims Jaipur
Faculty Speaks
Vyaktitva- Kavya Jain, Priya Varshney,
Supriya Singh, Swati Purohit
Vyaktitva Best Practice- Priya Varshney
Biz News- (Supriya Singh & Gunjan Mishra)
Supriya
(Kavya Khenwar & Tushar Sharma)
Best Practice (Supriya Singh)
Prospectives- (Pranshu Omer, Kavya Jain,
Ashish Upadhyay) (Kavya Jain, Vaibhav
Biz News Shukla, Ritu Sharma) (Supriya Singh, Swati
Purohit)
Glossary- (Kavya Jain) (Supriya Singh)
Perspectives (Supriya Singh)
Fun Mania- (Rahul Mishra)

Glossary Design- Pranshu Omer
Dispatch- Pranshu Omer

Fun Mania

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Dear all!!!

We bring to you the second issue of Epitome - The Student’s Journal of JIMS. Our readers have been
responding enthusiastically to Epitome. As we put this issue together, we thank all the students for their
contribution in making its release successful, also the guidance and support from our faculties has been
overwhelmingly frequent.
The current issue touches upon interesting topics related to Marketing, Finance & Human Resource.
We provide you a view on each:
We have tried to capture Steve Jobs’ journey since his birth and bring out his impeccable contribution
From the Editor’s Desk

for the IT industry, especially Apple. As a visionary, he saw that computers could be much more than drab
productivity tools. Instead, they could help unleash human creativity and sheer enjoyment. Whereas the Best
Practice, Engagement Champions is a content driven facet representing the Human Resource Management on
the whole. The role of champions can be as narrow or as broad as you like, the article here takes you through
its journey.
The news, plays a vital role in human affairs, Epitome also covers all the business and non-business
developments happening around the World. The other interesting thing is that it is very inspirational as many
articles on critical issues like 10 Marketing Trends, upcoming trends like Brand Butlers and Blogging, Euro
Debt crisis, SBI’s Downgrading, Executive Compensation etc. are discussed.
We hope this edition will make your reading more fruitful and will be liked by you. We are looking
forward for your valuable feedback and response.

“It’s good to perform. But sometimes it’s just so valuable to make use of a specialist.”

- Kavya Jain, Pranshu Omer, Priya Varshney,
Supriya Singh, Swati Purohit & Vaibhav Shukla.

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FACULTY SPEAKS: Differentiate to sustain:
We are living in age of lightening trends. The space around us changes in split seconds and lo behold! We have a new set of
dynamics in our hand. The need of the hour is to be agile, creative and to differentiate oneself. Differentiation is the
essence of the strategy, the prime source of competitive advantage. The sharper your differentiation, the greater your
advantage. A systematic approach helps in understanding your sources of differentiation. It enables one to have a
meaningful discussion of what distinguishes you from other and what you can build on. One way is to look at your growth
and milestones till date and determine what they have in common. This is a starting point for mapping your differentiators.
As you deliberate about the key differentiators, you might consult these criteria:-

Are they:
1) Truly distinctive?
2) Relevant to what you deliver. Though each of these points seem obvious, reaching agreement on your differentiation and
testing it against these criteria is not as easy as it sounds.

The ability to recognize and test the sources of your differentiation is important for focusing innovation. Harsha Bhogle,
renowned commentator and IIM-A alumnus realized that his key differentiator laid in lucid and sharp cricketing
observations laced with humor. The sense of balance in his presentation made him at ease and an expert in both print and
electronic media. Aamir Khan, bollywood Indian film actor, capitalized on his keen knack for observation and details, to
leverage himself as a successful film producer.

The best way to grow is usually by replicating your strategic advantage in new contexts .As individuals one can expand in
one or more ways: Create an added skill to existing set, Explore new industry verticals, Explore new geographic locations
or Enter related specialized lines. Chetan Bhagat, Indian author, columnist, and speaker moved on from a career in
investment banking to writing. Captain G. R. Gopinath, a former Indian Army officer capitalized on his skills to launch low
cost air travel. Kiran Mazumdar-Shaw a technical manager at Standard Malting Corporation capitalized on her knowledge
of industrial enzymes to launch Biocon Limited.

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As individuals, we should also learn to sustain the differentiation .The concept of lifelong learning takes a special relevance
here. Lifelong learning demands that the individuals upgrade skills and knowledge in current / future area of specialization.
This source of differentiation can be turned into sustainable advantage for the individual if the acquired knowledge and
skills are enhanced with in depth study of the field. Deep understanding of the sources of differentiation help individuals
turn in remarkable performance year after year.

-Ms. Pooja Kudesia,
Asst. professor, Jims Jaipur

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VYAKTITVA
STEVE JOBS

Full name: Steven Paul Jobs

Birth date: 24 February 1955

Birth location: San Francisco, California

Social background: Lower middle-class. Father used to fix cars for a living.
class.

Education: High-school certificate. Dropped out of Reed College after one semester.
school

Occupations: Chairman & CEO at Apple Inc. & Director at the Walt Disney Company.

Net worth: $5.5 billion according to Forbes' 2010 ranking 136th richest man on Earth.
ranking-

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Family-

Biological parents: Joanne Simpson and possibly Abdulfattah Jandali.

Adoptive parents: Paul and Clara Jobs, both deceased.

Siblings: Adoptive sister: Patti Jobs (born 1958), biological sister: Mona Simpson (born 1957).

Spouse: Laurene Powell (born 1964), married in 1991.

Children: Lisa Brennan-Jobs (born 1978), Reed (born 1991), Erin Siena (born 1995) and Eve (born 1998) with wife
Jobs
Laurene.

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Steve Jobs the Legend-
Apple is what it is today because it marries cutting edge hardware and software to provide the user an experience he has not
had been before. This all because of Steve Jobs. Steve, who just stepped down as CEO of Apple, doesn't frequent the World
Economic Forum in Davos, Switzerland. Yet, at this ultimate gathering of the global economy, Apple products are
omnipresent.

In 1976, when Jobs was just 21, he and Wozniak started Apple Computers. The duo started in the Jobs family garage. Jobs
and Wozniak are credited with revolutionizing the computer industry by democratizing the technology and making the
machines smaller, cheaper, intuitive, and accessible to everyday consumers.

In 1985, Jobs resigned as Apple's CEO to begin a new hardware and software company called Next Inc. The following year
Jobs purchased an animation company from George Lucas, which later became Pixar Animation Studios. Believing in
Pixar's potential, Jobs initially invested $50 million of his own money into the company.

Reinventing Apple-
Despite Pixar's success, NeXT, Inc. floundered in its attempts to sell its specialized operating system to mainstream
America. Apple eventually bought the company in 1997 for $429 million. That same year, Jobs returned to his post as
Apple's CEO.
With a new management team, altered stock options, and a self-imposed annual salary of $1 a year, Jobs put Apple
back on track. His ingenious products such as the iMac, effective branding campaigns, and stylish designs caught the
attention of consumers once again.
Jobs' revival and leadership of Apple will go down as one of the great examples of individual corporate leadership of
the 20th (and likely the 21st) century. The heroic tale of a single creative mind rescuing a brand, creating thousands of jobs,
and bestowing wealth on employees in the midst of a turbulent era is an irresistible one.

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Steve’s Influence on Apple-
“He didn’t create anything really, but he created everything.”- Former Apple CEO John Scullery on Steve Jobs’
contribution to Macintosh

"His DNA was built into this company. And when he came back, everything fell into place — a return to excellence in
design, to listening to the consumer, to developing cool products."- Heidi Roizen, one of Steve’s long-time business
partners

“The Mac is the expression of his creativity, and Apple as a whole is an expression of Steve.”- Larry Ellison, one of Steve’s
best friends.

- KAVYA JAIN, PRIYA VARSHNEY, SUPRIYA SINGH, SWATI PUROHIT

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BEST PRACTICE
ENGAGEMENT CHAMPIONS

Convergys employees drive their own engagement activities!
In 2009 Convergys started Employee Engagement Champions initiatives, which were based on the model ‘employee
engagement for the employees by the employees’. Convergys employees lead, organize and participate in employee
engagement initiatives be it CSR, rewards ceremonies or family day etc. under this initiatives they have a set of employees
wards
who are Employee Engagement Champions (EECs) at each site, which are headed by a site site-level Chief Employee
Engagement Officer (CEEO). The CEEO may not have leadership responsibilities in his or her specific job function, but the
responsibilities
CEEO’s role is a professional development tool in itself, exposing them to many leadership functions such as team building,
job delegation and effective interpersonal and site
site-wide communication along with their respective sites in a cost
cost-effective
managers. They look at special initiatives in which the employees have been involved apart from their work. They also look

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at their ability to work as a part of a team, what innovative approach they would take towards the role and their willingness
to take on the additional responsibility along with their designate work. EEC’s conduct site- and process-level activities
based on the wants and needs of the employee body in that location. This high energy team not only represents the voice of
our employees while planning our employee engagement initiatives, but also plays a key role in organizing and executing
these initiatives to the maximum benefit of the employees. Convergys HR partners work very closely with the EECs at
every stage to ensure the success of each initiative.

The employee engagement programs operate in different dimensions like career development which is done through
career fairs, workshop of internal postings and Convergys University that highlight career opportunities within the company
that employee may wish to consider and help them succeed and grow in the many different roles available at Convergys.
Employee recognition done monthly, quarterly and annually highlights achievements across a variety of measures. In
addition, health camps like free diabetes camp, eye and dental check-ups and fun activities like Convergys singing idol Do
Re Me Fa competitions, celebration of independence day and other important holidays/festivals builds and fosters strong
relationships between Convergys employees and contributes towards a fun and energizing workshop environment. CSR
activities like visit to Sankalp School for underprivileged children and RMRC visit where Convergys employees educate
slum children provides them a sense of giving back something to the society and demonstrate the fact that the company
cares for both employees and society. All the employee engagement initiatives are well planned and expertly implemented
as these activities are direct reflection of the company values, which include team work, developing people and corporate
citizenship. Also, this initiative reaches out to every single one of Convergys employees on a regular basis. This type of
regular contacts foster a good working environment, strong employee bonds and helps to meet Convergys retention and
recruitment goals and maintain high output and fill rates with new hire training and hiring.

Since employee engagement at Convergys is not just about fun, but, is focused around team building, connecting
employees with the organization and each other, corporate social responsibility and so on employees share their options on
the type of the activities in which they would like to be involved, and as a result, the EECs organize inter-process sports and
cultural competition, dance and self-defense classes, inter-team quizzes, theme dressing days, and a wide variety of other
activities. “The objective of the exercises was to help employees conquer their fears. The day’s activities helped employees

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understand how a strong self-belief and teamwork can help individuals and groups surmount challenges and succeed,
boosting confidence and morale”.

Recently in Gurgaon, employee members of the Convergys Community Action Network (CAN) initiated a monsoon
hygiene drive for Sankalp School’s 350 unprivileged students. The employees travelled from Convergys Atria contact
centre facility in Gurgaon to visit the school and teach the students how to maintain their health and their personal hygiene
during monsoon season through storytelling via posters, quizzes, and by singing song about benefits brought but rainy
season. Convergys Foundation allocates funds for all the CSR causes that employees put their efforts in. All those
participating in such activities have an additional avenue to reflect and build their management skills in addition to any
opportunities they may have to do the same within their primary roles. Such exposure value-adds to their career
development and inspires other employees to be a part of the EEC initiative.

Even through Convergys does not track individual participation in aggregate. “Decreased absenteeism and attrition
and positive energies in the workplace are playing big roles in driving the profitability of Convergys business. The
challenge comes when an EEC team member is unable to devote enough time towards these initiatives due to duties
required by that person’s primary role. Convergys publish all employee engagement initiatives in Linked, which provides
all employees across sites with a pan-India view of activities. They have launched Convergys activities in India Facebook
page that regularly contributes to the Convergys Action Network CSR- related Facebook page. They also publish their
initiatives and activities on the Convergys employee portal and in the corporate ‘Week in Review’, an electronic employee
newsletter.
Convergys believes that one doesn’t always need to spend money to develop talent. All one needs is innovative thinking and
a will to involve employees.
- PRIYA VARSHNEY

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MARKETING
M&M and Yamaha India to tie up in two two-wheeler business-
The partnership is believed to be a technical tie up from M&M's end as the company lacks technology for the two wheeler
tie-up
business. Yamaha on the other hand is looking to gain from M&M's distribution and dealership network.
distribution

“Staples” revamps B2B e-commerce site- -
The new site is designed to feature faster and easier search navigation, alternative product recommendations and enhanced
site customization, among other changes.

Kingfisher Airlines' stake-buy talks report denied by Reliance Industries-
buy
A spokesman for Reliance Industries denied on 15-11-2011 a media report that the energy major was in talks to buy a stake
2011
in cash-strapped Kingfisher Airlines.

Cabinet Clears 51% FDI in Multi-Brand Ret
Brand Retail, 100% in Single-Brand Chains-
Union Cabinet decided to allow foreign retailers to hold 51% stake in the multi brand retail sector and also raised the cap on
multi-brand
single brand segment to 100%. The investment needed for entering the sector has been put at $100 million, 50% of which
should be set aside for building backend infrastructure such as cold chains and warehousing. To make the move politically
palatable, the government has made it mandatory for foreign retailers to source 30% of their requirement fr from small and
medium enterprises.
- SUPRIYA SINGH & GUNJAN MISHRA

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FINANCE

India pitches for Moody’s rating upgrade-
A team of executives from Moody met senior officials of the Finance ministry as a part of review process for sovereign
ratings.

Wall Street off an Euro instability, recession fears-
Wall Street edged lower on as Italy and Greece rushed to form technocrat led governments in bid to stave of Euro zone’s
debt crisis.

European banks Hamstrung by new rules, says bosses-
Banks are being forced to raise their capital levels in response to European efforts to contain the sovereign debt crisis that
has engulfed Greece.

GDP growing at 8%-
The revision of 8% from a previous forecast of 8.2% can be attributed to a lower than expected industrial output growth and
a stubbornly high rate of inflation.

IBSA Trade (India, Brazil, South Africa Trade)-
Trade between the three nations, i.e. India, Brazil and South Africa, which currently amounts to $20 billion, is expected to
grow to $25 billion by 2015. These economies have decided to remove non-trade barriers and improve maritime and air
connectivity. A summit is also being organized to hold formal annual trilateral talks to boost intra-IBSA trade.

Value of rupee goes down.
Due to recession in Europe the value of Rupee goes down in international market. Now 1 $ costs more than Rs 52.

- KAVYA KHENWAR & TUSHAR SHARMA

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HUMAN RESOURCE

Need 44 million civil engineers by 2020-
A research report 'Real Estate and Construction Professionals in India by 2020' by RICS ( Royal Institution of Chartered
Surveyors) indicates a probable demand-supply gap of 44 million core professionals comprising civil engineers, architects
and planners, BY 2020.

67%Indians happy with current job: LinkedIn survey-
LinkedIn survey showed that professionals working in India are not only happy with their current jobs but are also
optimistic about getting better opportunities with the current employer putting the country in the seventh place on the global
scale.

Looking for a job? Facebook, Twitter can help!-
According to the Kelly Global Workforce Index 2011, which covered 97,000 people across 30 countries and 2,000 people
in India, about 35% of the respondents in the country scoured social networking sites to seek job openings.

Indian IT firms give poor payments-
India Inc among the lowest paying employers in the IT space, with their mid-to-senior level staff getting an average salary
of $36,120 per annum-less than one fourth of the IT pay package at globally top-paying Swiss companies.

Colors ropes in Prashaant Bhatt as head of fiction-
Colors have appointed Prashaant Bhatt as head of fiction. Bhatt joins Colors from Balaji Telefilms, where he was the
creative head for several shows.

Cyrus Mistry named as Ratan Tata’s successor-
Shapoorji Pallonji Group’s MD Cyrus P. Mistry has been named as the successor of Tata Group’s chief Ratan Tata. He will
take over as Tata Sons Chairman in 2012.

- SUPRIYA SINGH

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PROSPECTIVES
MARKETING
TOP 10 MARKETING TRENDS

As the global economy struggles to correct itself, and social-media marketing becomes a strategic imperative, small
media
businesses will have exciting opportunities to expand in new directions this year.

The need for trust, value and brand transparency, among other trends from last year, are just as important toda But the
today.
current shift to retargeting, mobile marketing and online reputation management require that small businesses modify their
plans to surpass competitors.

Here are 10 marketing trends that small businesses should incorporate now to be positioned for success from the start:

1. Building reliable brand advocates: The idea that you need tens of thousands of Twitter followers, blog
advocates:-
subscribers, LinkedIn connections and Facebook friends to build your business via social media is dead. Quality

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connections with those who are loyal to the business and the brand are far more helpful to spread your message than
large groups of connections who disappear after the first interaction.

2. Excelling in one area rather than being all things to all people:- This will be a year for small businesses to focus
on their unique niches and position themselves as the definitive source for information, products and services related
to the specific places in the markets where they operate.

3. Creating quality content as a viable marketing tool:- Social media marketing and content marketing go hand-in-
hand and this is the year businesses will create useful content that adds value to the online conversation and to
people's lives. The Web is a cluttered place. Amazing content is essential to break through the noise.

4. Moving more marketing dollars to social media:- Statistics show that large and small companies are shifting
budget dollars to social media and other digital marketing initiatives and away from print and radio advertising.
Consumers spend more time online than ever and to reach them and stay competitive, small businesses need to have
a presence on the social Web.

5. Tracking brand reputations on the social Web in greater detail:- Social media has given consumers a large
platform to voice their opinions, and small-business owners are realizing the importance of actively monitoring their
reputation on the Web. With dashboards and social media aggregators like Hootsuite and Spredfast, it's easier than
ever for small businesses to develop, nurture and track their stature online.

6. Increase in branded online experiences to meet diverse consumer needs:- Simply having a Twitter account or
Facebook page isn't enough this year. Small businesses must surround consumers with branded online destinations
such as a blog, LinkedIn profile, YouTube channel, Flickr profile and so on. Consumers can then pick and choose
how they want to interact with your brand. Of course, quality trumps quantity, so extending a brand across the social
Web must be done strategically to maximize opportunities without compromising content and communications.

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7. Pursuing mobile marketing:- There is absolutely no doubt this is the year of mobile marketing. While still in its
infancy, it is the marketing imperative of the future. With mobile advertising, branded mobile apps and mobile
marketing apps like Foursquare, consumers will expect businesses to have a mobile presence in 2011.

8. Geotargeting and localized marketing will become a top priority:- Local discount websites like Group on and
local review sites like Yelp make it easy for consumers to find deals and reviews about businesses in their
neighborhoods and beyond. Creating targeted, local marketing campaigns using these popular tools will become the
norm this year.
9. Accepting that silo marketing is ineffective:- Offline, online and mobile marketing initiatives create an opportunity
to lead consumers from one message to another by integrating those strategies. You can drive a significantly higher
return on investment by cross-promoting branded online destinations, discounts, contests and events.

10. Co-marketing to boost returns and lower marketing costs:- The economy is still struggling, which means small
businesses can benefit from economies of scale by partnering with complementary businesses to develop co-
marketing programs in 2011. Promotional partnerships not only lead to reduced costs but also can lead to increased
exposure to new audiences.

This year, all businesses will be experimenting with a variety of online, localized and mobile marketing initiatives.
Remember, even if you're not leveraging marketing trends and opportunities, your competitors are.

- PRANSHU OMER

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WHO STOLE MY RETAIL DREAM…?
In the euphoria of the great retail boom, organized retail players have forgotten that India’s 12 million shopkeepers, 40
million hawkers and 200 million farmers can spoil their party. Modern retail boom is the biggest story to hit India this side
of Afghanistan. Almost every day, more encouraging figures are thrown up about this boom, which is going to change the
face of India. As per the latest estimates, organized retail is USD 12 billion at present, which is expected to touch USD 75 b
by 2012 and USD 175 b by 2016. India is the 9th largest retail market in the world.

And this is not enough. Organized retail is only 3% of the total retail market in India. The comparative figures for US
are 85%, UK 70%, Malaysia 55% and China 17%. The organized retail segment in India is expected to contribute 10% by
2012. The retail dream cannot go wrong. The future looks so full of hope and promise.

But are we all missing the point?

When the opposition to big retail started in West Bengal, it was dismissed as the Left parties had always been opposed to
MNCs and big business. Then it happened in Kerala, where political parties along with local shop owners and merchants
opposed the opening of Reliance Fresh stores in Kochi. In August 08, a one-day statewide strike was organized in
Maharashtra by retailers and wholesalers to oppose the entry of big retailers, which was adversely affecting their business.
Now Mayawati has stopped the operations of retail in UP citing law and order as the problem.

What’s going on? There is a problem nobody wants to see or even acknowledge. Retail giants are so busy working
out their grand plans that they are completely oblivious of the volcano, which can erupt anytime.

By asking this question to three CEOs of organized retail. All of them were convinced that the entry of big retail is
not going to affect small shop owners, as there is enough market for everybody. Their business model talks about speed,
scale of operations, expansion plans and a golden rainbow at the end of all this. They seriously suspect that they are going to
change the face of India. Big research agencies like Tecnopack-KSA keep doing research and confirming this misplaced
optimism.

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Unfortunately, nobody has done any empirical study to understand the impact on small retail shops due to organized
retail. India is a nation of shopkeepers, where 12 million shopkeepers and 40 million hawkers conduct 97% of the retail
business. And every time, a new mall opens, these guys get affected.

Let’s understand what happened in the US. A study by Pennsylvania State University in the United States measured
the impact of the Wal Mart retail boom on the poverty prevailing in 2004.

It established that American states with a greater number of Wal Mart stores in 1987 had a higher rate of poverty in
1999, than states where fewer stores were set up. Interestingly, increased poverty from Wal Mart operations came when
poverty rates nationally were on the decline.

Three reasons were given for this state:

1. Worker displaced had no alternative livelihood. They were forced to work in Wal Mart stores at relatively lower
wages. In India, displaced shopkeepers have no such option (working in modern outlets requires knowledge of
English). So they will have to quit or continue with a lower sales volume. I spoke to such shopkeepers where large
malls had opened in nearby areas. All such shopkeepers were losing sales.

2. It destroyed local entrepreneurship and uneducated people could not earn their livelihood, which was bound to create
social unrest. This would be more pronounced in the Indian environment where generations after generations are
dependent on small business, generally retail. A no hope retail environment for young people can generate
tremendous backlash.

3. Thirdly, Wal Mart transferred income from taxpayers to its stockholders and consumers. In the Indian context,
organized retail players are not likely to bear the economic and social cost of their nationwide operations.

I believe that this is just the beginning. Unwittingly, Mayawati has put her foot on a simmering issue. This is a social and
economic issue, which can blow up any time. Organized retail players have to re-evaluate their business model and find a
way to include the affected parties in their growth story. Their business model will remain incomplete without taking into

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account affected small business owners. Can these big players form a co-operative with the help of affected parties before
they even enter an area? The government needs to step in; big players need to understand the social and economic
consequences of not taking any action.

The retail boom is good for consumers and good for the country. Can we afford to spoil this party?

- PRANSHU OMER

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BRAND BUTLERS

While brand butlers were introduced a few years ago as a promising, emerging trend now is the time to go all out on
'serving is the new selling'. BRAND BUTLERS With pragmatic, convenience-loving consumers enjoying instant access to
loving
an ever-growing number of supporting services and tools (both offline and online), brands urgently need to hone their
growing
'buttering skills', focusing on assisting consumers to make the most of their daily lives, versus the old model of selling them
a lifestyle if not identity.

Here's why consumers are embracing these brand butler
hese butler-style services:
For consumers, time, convenience, control and independence are the new currencies: this need requires b2c brands to turn
currencies:
many of their 'campaigns' if not all interactions with their customers into broader services. In shor a shift from
. short:
'broadcasting' to assisting.

Relationships with brands are now more down to earth and less reverential. From individualism to eco
eco-concerns to
decreased spending power in developed economies: for consumers, the practical and pragmatic rule.

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Yet, in uncertain times, there's also a consumer longing for institutions that truly 'care', which is more about showing
empathy and providing customers with a status fix than being purely practical. This too requires brands to master more
service-oriented personae.
On top of all of the above, the current mobile online revolution is shifting these consumer expectations even further into the
always-on, instant gratification online arena. For brands, this means that there are now endless creative and cost-effective
ways to deliver on this need for assistance, for 'butlers'.

Build A Brand Butler omnipresence-
While many brands now offer at least a few stand-alone brand butler services, very few brands have an integrated brand
butler strategy in place yet.
That means a major opportunity to be amongst the first to roll out a cohesive suite of services, embodying the essence of
your brand. And with brand essence we mean: What are you about as a brand? What themes? What benefits? Is it
'connectivity'? Inside information? Convenience? Hope? Health? Speed? Reliability? So, fine-tune your theme(s), and let
them be at the center of any brand butler brainstorming.
The resulting, ideal ‘brand butler omnipresence' would be a mix of being there when customers want you to be there, and
pleasantly surprising them with your presence when they least expect it. For simplicity's sake, this omnipresence can be
divided in online and offline activities:

Online-
It should come as no surprise that apps, whether for iPhone, Blackberries, or Android devices, offer a quick route to deliver
brand butler services: offering useful, (semi-) branded content, residing on consumers' online devices is a marriage made in
heaven

Offline-
In the 'real' world, brands obviously can’t be everywhere all the time. By default, they will be more expensive to execute as
well. So 'offline' brand butler services need to be prioritized by utter relevance and/or surprise. One popular offline brand

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butler tactic is to establish permanent or pop-up branded spaces and lounges, often tied to a specific event (music festivals!)
or a location (airports!) which offer ample opportunity to assist consumers / customers with relevant, on-brand services.
And here too, like with apps, partnering is key: no need (or even possibility) to go it all alone in what is now a cooperation-
economy, anyway.
In the end, finding the right mix of online and offline brand butler services is something you will have to do yourself.

Brand Butler Examples-
 MasterCard’s ATM Hunter iPhone app allows users to find their nearest ATMs by entering their location or using
built-in GPS functionality.
 Google labs have developed City Tours, which uses Google Maps to offer a variety of walking tours in cities
around the world. The tours also offer practical information such as opening hours.
 Olay for You is a branded micro-site offering a two-way dialogue with consumers to help improve their skin. The
user is asked a series of questions centered on their lifestyle, appearance, and skincare regime, before offering some
advice and a product recommendation.
- KAVYA JAIN

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BLOGGING- A WAY TO DEVELOP A UNIQUE BRAND

With the blogosphere churning out nearly 1 million posts every 24 hours, an unstoppable river of content flows over the
web daily. It’s daunting, especially if you’re new to online publishing. The good news is it’s still very possible to succeed,
even if you’re just starting out today.

Developing affinity with a group of readers who will actually take the time to link, comment and share your material
requires a commitment of both resources and creativity – this is common knowledge.

But all other things being equal, you can and should give yourself an extra advantage by developing a unique brand
for your blog. This is beyond being organized and having a plan, this is about standing out in a world of infinite choice.
organized

With that in mind, here are 7 ways to help develop a unique brand for that shiny new blog you’ve just built, or give fresh li
life
to your current site. Ideally, you could incorp
incorporate all of these:

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1. Develop a post archetype-
Develop a compelling post archetype that people respond favorably to and continue to feed your content into it. It can be
something as simple as using a certain type of image, post heading, graphic, etc. – just something which makes your posts
stand out on their own in an RSS reader as content a-la-carte.

2. Create a simple or unique design-
Most bloggers tend to over-complicate their blog designs. Complexity in web design is standard and expected. Simplicity is
a thing of beauty. Develop a unique design that takes a chance and pushes the limits, it’s a good way to get noticed.

3. Refine your writing quality and style-
The single best way to create a blog with a unique brand is to have writing quality and style which is distinctive, emotive or
in some way compelling. Writing is the heart of your blog’s brand, and has the power to transcend all other factors – the
importance of this can’t be overstated.

4. Find a way to view your topic from a fresh angle or different lens-
As long as there is interest in a niche, it can never be too crowded for fresh thinking. Even within the most popular topics,
the ways established sites cover ideas is relatively predictable. New sites can use this to their advantage simply by not
covering ideas in the same way. Remember, while there are many fans of popular sites, there are also plenty of dissenters
just waiting to give voice to something different

5. Focus on a unique topic or intersection of topics-
There’s really no topic that’s too specific or unique, in fact, the more offbeat, the better. There’s an audience for it, and if
not you can make one. Another approach is to find a intersection of complementary topics. Music and inspiration,
marketing and sociology, personal development and fitness, search and social media – you get the idea.

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6. Create a better signal to noise ratio-
It’s common to publish frequently for the sake of publishing – but the real opportunity is to make your site known for signal
and kill the noise. Becoming known as a site with a high degree of signal is how you will build up a silent army of users
active in the social web who share your content every time. If you deliver on this long enough, the world will become
conditioned to anticipate quality from you, and your content will be shared each time you hit publish.

7. Focus on achieving consistency-
Quite possibly one of the most difficult hurtles to get over for developing a successful, unique blog is being consistent.
Blogs that deliver high quality material on a consistent basis get noticed. Out of more than 133 million blogs created since
2002, only 76,000 of them have a Technocratic ranking of 50 or higher – something that is a result of consistency.
- ASHISH UPADHYAY

29


FINANCE
TIGHTENING MONETARY POLICY
Given that inflation continues to be the main worry for policymakers, it is not surprising that the Reserve Bank of India, in
its second quarter review of monetary policy, has extended its policy of monetary tightening, the RBI raised key interest
rates by 25 basis points, its 13th such hike since March, 2010, raising the repo rate by another 0.25 percentage point to 8.50
per cent. The RBI, while announcing its mid-term review of the monetary policy, kept all other rates and ratios unchanged.
Although manufacturing and core inflation have moderated sequentially, year-on-year inflation continues to rule well above
the RBI's medium-term targets.

We cannot 'fix' inflation by such short-term mechanisms that only end up making life more expensive for the poor.
Actually, the criticism being made by corporate India - that inflation cannot be fought by simply driving up interest rates
indefinitely - looks at the same issue from another prism.

Arguing that any premature withdrawal from what has been a consistent policy stance since February 2010 will entail
the risk of leaving inflation expectations unhinged, the RBI has, for now, ignored the growing clamor for a “pause” in
hiking interest rates. It has, however, conceded that some important growth indicators are slowing down at a rate faster rate
than anticipated, partly due to the delayed impact of previous interest rate hikes.

Slower growth in the United States and the spiraling sovereign debt problems in Europe pose significant challenges
for the management of external economy. Petroleum prices remain sticky and the sharp depreciation in the rupee can offset
the gains from the fall in other commodity prices. A weak Rupee is also adding to the inflationary pressure as it pushes up
the landed cost of imported commodities. India depends on imports to meet 80 per cent of its crude oil requirement. It also
imports a large quantity of vegetable oils and pulses. The fuel hike comes against the backdrop of the Rupee's value falling
below 48 to a dollar for the first time in almost two years, while global crude prices -- especially the Indian basket --
hovered around $111 a barrel in the first fortnight of September. We are entering a spiral situation.

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However, the good news is that, in RBI's assessment, inflation is likely to moderate from December onwards. In its
clearest message yet of a softer monetary policy ahead, the RBI says that the possibility of a rate hike in the December
policy review “is relatively low”. While retaining its inflation target for March 31, 2012 at 7 per cent, the RBI says that
monetary policy will have more room for addressing short-term growth concerns.

The RBI's growth estimates have generally been more conservative than those of the government. In May, the annual
policy statement had projected an 8 per cent growth for 2011-12, at least 0.50 percentage points higher than what most
official estimates indicated. In the light of growth trends during the first half of the year, the RBI has revised it to 7.6 per
cent.

Among the development and regulatory policies announced along with the review, the deregulation of savings bank
interest rate stands out .With this; administered interest rates will be confined to a very narrow spectrum of small savings
schemes. The argument is that the RBI’s efforts to use increases in interest rates to moderate inflation has not worked
because the transmission of increases in the Bank and or repo rates to the loan rates charged by banks is muted. Since banks
have access to funds in the form of savings deposits on which the interest rate is fixed, the cost at which they obtain capital
does not raise in proportion to the increase in the RBI’s intervention rates. So banks do raise interest rates on their loans, but
not adequately, muting the effect of the policy on demand and inflation. Unwilling (and also unable) to restrict credit flow
because of the fear that it will affect growth too adversely, the central bank has decided to maximize the impact on demand
of the thirteen interest rate hikes it has announced in recent months. The RBI holds that the policy has been on the anvil and
had been seriously considered a couple of times in the recent past Ironically it was only recently the government decided to
borrow Rs.50,000 crore more than was budgeted to offset a huge fall in small savings collections, which were drifting
towards bank deposits. In a deregulated environment there will be stiffer competition and that should be good for savings
bank account-holders. But the biggest impact will be on the banks themselves. The way the leading ones manage their
balance sheets will be keenly watched.

- KAVYA JAIN

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SBI DOWNGRADING & IT’S IMPACT

Moody's decision to downgrade State Bank of India, which accounts for nearly a quarter of the country's banking system,
has not gone down well with government officials accusing international ratings agencies of following a policy of
"apartheid" against the emerging and the developing economies .Moody's cited a likely rise in the bank's non-performing
assets in the near future as one of the reasons for the downgrade. "The rating action considers SBI's capital situation and
deteriorating asset quality. Our expectations that NPAs are likely to continue rising in the near term - due to higher interest
rates and a slower economy -- have caused us to adopt a negative view on SBI's creditworthiness," Moody's vice-president
and senior credit officer Beatrice Woo said. "Notwithstanding our expectations that SBI's capital ratios will soon be restored
through a capital infusion by the government, SBI's efforts to secure this capital for the better part of the year demonstrates
the bank's limited ability to manage its capital," Woo said. SBI had reported a Tier-I capital ratio of 7.60 per cent as of June
30, 2011, as against the suggested level of 8 per cent termed as desirable by the government for public sector banks. "The
level pushes the bank into a lower rating band. In addition, it was below the 8 per cent Tier-I ratio that the government of
India has committed to maintaining in public sector banks and substantially lower than those of other C- rated Indian
banks," the ratings agency said. It said such a low Tier-I capital ratio provides an insufficient cushion to support growth and
to absorb potentially higher credit costs arising from deteriorating asset quality. In case of SBI, whose rating was cut to D+,
Also, banks are not allowed to collapse and the government and the Reserve Bank of India step in to ensure that there is no
risk to depositors or the system in general. Officials pointed out that at the end of June 2011, SBI's gross non-performing
assets were to the tune of 3.5% of its assets. Net NPAs, which factors in provisions, were 1.6% of assets. "At these levels,
Indian banks are much better off than European and American banks. Look at the kind of securities they hold and the
quality of those papers," a top official said. Even on the issue of Tier-I capital, the bank is above the regulatory norms. At
the end of June, SBI's capital adequacy ratio was 11.6%, against RBI stipulation of 9%, although lower than the
government's comfort level of 12%.

Because of this rating done by international rating agency Moody's The Bombay Stock Exchange Sensex fell 286 points to
15,864 and left with a warning that its bad loans would rise. "The downgrade of SBI had a contagion effect on the banking

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sector with most stocks ending sharply lower. Also, stocks in sectors like metals and auto were sharply down. The
downgrade pushed SBI's share price down 4.08% to a two-year low of Rs 1786.

- VAIBHAV SHUKLA

33


EUROPE’S DEBT CRISIS AND THE DANGER WE CAN’T SEE
There are plenty of reasons to be freaked out by the banking and sovereign debt crisis now reaching a crescendo in Europe.
But one factor that's gotten little attention could turn this Very Bad Situation into a True Calamity.

It's this: Regulators here and in Europe have no idea of the full extent of the derivatives exposure that could be
triggered by an "official" Greek default or by the failure of major French bank. And if the people in charge have no clue as
to the fallout from what may be trillions of dollars in side bets waiting to be triggered in a catastrophic cascade, they're
basically flying blind.

If it strikes you as insane that officials don't know the exposure of these derivatives, given the havoc these "financial
weapons of mass destruction" wreaked last time, you're thinking clearly. The idea that we could be back on the edge of a
Lehman/AIG-style implosion, just three years after the near-death experience of 2008, defies all presumptions about the
human species' capacity for learning. But then, Darwinian optimism leaves little room for the greed and myopia driving the
global banking lobby today — or for the industry's destructive power to kill or defer common-sense reform.

Remember, it was always odd that problems in the relatively small market for subprime mortgages could have
brought the global economy low. The reason they did was because these subprime woes were massively amplified by
trillions in side bets placed on these mortgages via exotic derivatives. "Naked credit default swaps" allowed parties with no
interest in the underlying mortgages to place huge bets on whether borrowers would or would not perform. Fear of the
explosive power of this casino — and its hidden concentration in a reckless, "too-interconnected-to-fail" giant like AIG —
led U.S. officials to cough up no less than $180 billion in taxpayer money to pay off these bets in full. These officials,
fearing a meltdown, treated sophisticated derivatives traders exactly as they would treat innocent consumer depositors in a
failing bank, as people to be protected at 100 cents on the dollar.

Today, Greece's economy is roughly the size of the economy of Massachusetts. The notion that its debt problems
could bring down the global financial system seems absurd. Except for two things; First, many European banks holding

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Greek debt are so thinly capitalized (another way of saying "so imprudently managed") that even tiny Greece's default could
wipe them out. Yet Europe's emerging plan to cover this capital shortfall is tragically inadequate.
As Douglas Elliott, a former investment banker now at the Brookings Institution, points out, the plan to add 100
billion Euros in capital represents a 10 percent capital boost for the top 90 banks, which have about a trillion Euros in
capital today. But since they also have around 27 trillion Euros in assets, this new capital would protect them against a
further decline of less than half a percentage point in the value of their assets.

Yet the derivatives black hole makes matters worse. Exactly how much worse? We don't know, because the big
banks don't have to disclose this information. The derivatives markets' opacity is precisely what lets banks make a
killing. If such trading becomes transparent and standardized, bank profits from derivatives will plummet. So they resist.

Even more outrageous, the chief negotiator for the banks being asked to take a deeper loss on their reckless loans to
Greece uses this unknown derivatives exposure as a negotiating ploy. "Nice little global economy you've got here," he's
basically saying. "Be a shame if something bad were to happen to it, if you make us say there's been a 'default.' "

To be sure, in the United States, once the Dodd-Frank implementing rules are written, traders will have to disclose a
good chunk of their derivatives activity sometime in. . . 2013. a bit late for today's crisis, but there's always the next one.

In the meantime, U.S. officials obviously talk to the banks they supervise. I'm told they have a better sense of U.S.
banks' derivatives exposure than was the case in 2008, and that they're not frightened by what they see. But taking comfort
here requires one to believe that banks are telling regulators the truth today, and that they actually know their own risk
positions (which even their CEOs didn't understand in 2008).

Even then, you can take comfort only if you think U.S. banks are the major holders of the relevant derivatives, when
it's almost certain that European firms are. And analysts tell me the Euro-banks' books are monuments of deceit that make
our own banks' faulty financial statements look like models of truth in accounting.

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Where does that leave us? There is more than $22 of derivatives for every dollar of goods and services produced in
the U.S. economy. Some of these are harmless hedges; others, bombs waiting to detonate. Nobody knows. As one hedge
fund manager told me: "All the bad lending is like a keg of dynamite, and all of the derivatives are like little fuses running
from one house to another to another, and in each house is another keg of dynamite."

One thing is certain. If it all goes on boom, the banking elites who've sniffed dismissively at Occupy Wall Street isn’t
seen nothing yet.
- RITU SHARMA

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HUMAN RESOURCE

GLASS CEILING

When we consider the issue of women empowerment we realize that it commences from the basic unit of human life -- the
family itself. The role of women in the family, their decision-making capabilities, the level of their education, respect for
their rights and their dignity, care of their health are all building blocks or enablers for the larger role that they can play in a
nation's development. It was Gandhi who said that women are mentally, spiritually and intellectually, equals of men. That
fundamental premise should guide our endeavor to permit the role and the encouragement for women as equal partners in
the progress India is making today. Empowered and self-confident women serve as role models to many others who look up
to them for inspiration and motivation. In the world of corporate there are various issues of gender discrimination, biases in
work allocation, insensitivity to women issues such as maternity, harassment, discrimination in salary hikes .These all are
the types of Glass Ceiling, "glass ceiling" refers to that invisible barrier beyond which minorities, in particular women in
middle level management, never rise. Silent, yet unbreakable, this barrier is one of the root causes why the percentage of
women occupying top-level management is much lesser than men. There are a handful of women who have breached this
barrier like Indra Nooyi, Simone Tata and Kiran Mazumdar-Shaw.

Researchers have said that even in today's times, gender discrimination at workplace is still very much alive and
kicking. Men and women in jobs that are generally associated with the other sex are judged more harshly when they make
mistakes and are constantly in danger of falling off a "glass cliff" in the workplace, experts said. World largest retailer, Wal-
Mart Stores Inc. also came into picture due to discrimination against female employees in Texas stores in pay and
promotion decisions, according to a lawsuit filed in Federal Court in Dallas. The complaint is the second to be filed since a
nationwide class action against the company was thrown by the Supreme Court in June2011. Software company Microsoft
paid over one million pounds to silence a female executive who was unfairly overlooked for the role of managing director at
the firm in Britain. Natalie Ayres, who worked at Microsoft for 15 years, was seen as an outstanding candidate to become

37


the general manager of its "Small-Medium Enterprises and Partners Group". But the role was handed to Gordon Frazer, a
general manager at Microsoft South Africa.

Reason for this is the tolerance of Harassment; if the employee doesn’t strive for his own rights then others will not
be able to know about what is happening with him. A famous saying in GEETA is “Pap karne wala se jada Papi Pap sahne
wala hota hai”. It’s true because if you are tolerating such things then you are giving more space to them. Generally
employees tolerate sexual harassment because they are afraid of facing the world, fighting the problems and are fearful of
the embarrassment thereafter. The other point is that women themselves are more visible in workplaces and they have some
extent broken away from the stereotyping at work, they are longer confined to being secretaries and stenographers. This
poses some issues of adjustment for men who are accustomed to treating them as arm candy.

The glass ceiling is a reality! This is not only because women are held to higher standards than men but also because
they are neither made aware of, nor given opportunities that would catapult them to the upper echelons. Often, women with
technical competencies in line functions such as manufacturing, R&D and operations end up in staff functions. Experience
in line or operational functions, during one’s mid-career are often an unwritten prerequisite to getting into the C-suite.

Last November2010, a study done by non-profit research organization Catalyst, titled 'Women in the Labor Force in
India', found that of the 1,112 directorships on the BSE 100 Index, just 59 (5.3 per cent) are held by women, and 54 per cent
of companies on the BSE 100 have no women board directors at all. This paucity of female executives does not reflect a
lack of ambition in women. The study also found that, "despite occupying small percentages of leadership positions, 97.2
per cent of women (compared to 95.6 per cent of men) aspire to jobs with increased responsibility. What make to stop
women? This is biggest question mark. According to Naina lal Kidwai who is a group general manager and country head of
the HSBC Group in India, says, "I worked my way up a very traditional corporate India where there were few women. She
said that there is many people around you want to see your failure, but your every failure is a failure of womankind.

While corporate India Inc is increasing looking at having diversity in their workforce by placing women
employees at key decision making position. This shows that now the Indians company wants to break glass ceiling. Som

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Mittal, President, Nasscom, is of the belief that gender inclusivity is a must for the long term success of the IT industry.
“India will play a key role in future transformation,” he claimed. “Women are a key and vital part of our workforce, and the
industry will continue to work towards creating a conducive environment and attract more women employees and leaders,”
he added. With such a rich pool of well educated and talented women currently available with the scope of their
participation in corporate affairs increasing, most companies are keen to have a mixed gender ratio. This is why you have
Neelam Dhawan first heading the country's biggest software company, Microsoft and then moving on to be at the helm of
affairs at Hewlett Packard. Dhawan is just one of the many women who have become synonymous with the companies they
work for.

But sadly the same can't be said of the Indian IT channel companies in the country. Barring a few there are hardly
any women who are in the key decision making positions in most big channel companies. In an industry that has been
largely male dominated, women have been able to make a mark, but not at the same speed as is seen in the rest of corporate
India. But companies like Infosys, Mahindra & Mahindra, Airlines, PepsiCo came front to stop this glass ceiling. Yes the
speed is slow but these companies are tried to stop this. For this they have made several rules to stop discrimination. But
most women aspiring to senior management positions believe the glass ceiling to career progression still exists, according to
a report by a leading UK management organization.

The survey of 3,000 members of the Institute of Leadership and Management (ILM) found 73% of female
respondents felt barriers still existed for women seeking senior management and board-level positions in the UK. In
contrast, just 38% of men believed there is a glass ceiling.

The report, Ambition and Gender at Work, suggests women's managerial career aspirations lag behind men's at every
stage of their working lives, and that they have less clarity over traditional career direction than men.

At the start of their careers, 52% of male managers had a fair or clear idea that they wanted to work in a particular
role, compared with 45% of women managers. Only half of women said they expected to become managers, versus two-

39


thirds of men. Even among the under-30s, gender aspirations remained entrenched, with 45% of men and 30% of women
expecting to become managers or leaders.

The findings, which came from an even sample of men and women with an average age of 43, also revealed that 24%
of women fewer than 30 expected to start their own businesses within 10 years, compared with 20% of men. This data
shows that women are still facing problem in corporate world.
- SUPRIYA SINGH

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EXECUTIVE COMPENSATION: A BRIEF REVIEW

Chief Executive Officer (CEO) compensation is defined as the sum of base pay, bonus, stock options, other forms of
compensation & benefits. Inflation- adjusted, median total CEO compensation in the United States almost tripled between
1992&2000, with grants of stock options evolving to be the largest component of compensation. This article presents the
arguments for and against this level and composition of CEO compensation.

The level of executive pay has long been a flashpoint with the general public, particularly in periods of
macroeconomics or stock market distress. To quantify the relative growth in CEO pay, in 1970 the average S&P 500 CEO
earned approximately 30 times the pay of an average production worker. By 2002, this multiple has risen to almost 90 times
the earnings of an average production worker in terms of CEO cash compensation ( salary & bonus), and exceeded 360
times the earnings of an average production worker in terms of CEO total compensation (Cash Compensation, Stock
Options & Grants, and other Compensation).

The principal argument for the contention that the level of CEO pay is economically justified is that a competitive
market for executive talent exists, and the level of CEO pay is a reflection of the intensive bidding by firms for scarce top
talent.

Moreover, CEOs are overpaid is a managerial power hypothesis. It argues that the pay-setting process is unduly
influenced by the CEO, as the CEO may have substantial influence over the composition of the board of directors & of the
compensation committee determining CEO pay is excessive for firms with relatively weak boards of directors, for firms
with no dominant outside shareholders, and for firms with a manager who has a relatively large ownership stake.

CEO pay is both meaningful & growing in relation to firm financials. The ratio of the aggregate compensation paid
by public companies to their top five executives to the aggregate earnings of their firms increased from 5% in 1993-95 to
9.8% in 2001-03 (Bebchuck & Grinstein, 2005).This trend makes the debate over CEO pay levels and the policies directed

41


towards CEO pay more important than ever. However, in pondering the regulation of CEO pay, there is a large literature
with contrasting viewpoints that demand careful examination.

Components of Executive Compensation:
There are six basic tools of compensation or remuneration. They are:
A. Salary
B. Bonuses, which provide short term incentives
C. Long term incentive plans
D. Employee Benefits
E. Paid Expenses(perquisites)
F. Insurance(Golden parachute)

A. Salary: Salary is the first component of executive compensation. Salary is supposed to be determined through job
evaluation serves as the basis for other types of benefits. But, in managerial compensation job evaluation plays only a
part & does not represent the whole truth. A manager is paid for his capabilities & for the job he performs, rather than
only job demands. This is the reason why the norms of wages & salary fixation are generally not observed, while fixing
the salary of the manager. Salary increments, also known as Performance Appraisal depend upon the executive’s
performance & contribution towards the growth of the company.

B. Bonus or profit sharing bonus: There are as many bonus systems as there are companies using this form of managerial
remuneration. In some systems, the annual bonus is tied by the formula to share return on investment. To augment the
base salaries of executives of major corporations, short term bonuses have ranged from 50% of base pay to 10 or more
times base pay.

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C. Long Term Incentives: Long term performance bonuses are cash payment similar to the short term bonus awards
provided to corporate executives. The major difference is that the receipt of the award is 2 yrs or more into the future &
the size of the award is based on multiyear achievement of established performance related goals.

D. Paid Expenses (perquisites): Perks constitutes a main source of income for the executives. In addition to the normal
allowed perks like PF, Gratuity, & the like, managers enjoy special perks like parking, plush office, vacation travel, auto
expenses, membership in clubs & well-furnished house etc. Perks takes care of all possible needs. Mangers are really
required to spend money from their own pocket. Their holidays, servants, telephone bills & even their electricity & gas
bills are taken care of by their companies.
E. Insurance(Golden Parachute): A special perk available to some executives, a golden parachute, provides protection &
security to executives in the event that they lose their jobs or if their firms are acquired by other firms. Executive
employment contracts often include special compensation provided to executives who are negatively affected in an
acquisition or merger. A typical golden parachute gives a departing executive a lump sum amount equal to two or four
times the annual salary & bonus, extra pension credits, immediate vesting of stock options & other sweeteners.
Golden parachutes are more noticeable in some executive compensation packages because they seem to offer a
safety valve no other employee have.

Executive Compensation: The Debate Continue-

The Ratio of CEO pay to factory worker pay rose from 42:1 in 1960 to as high as 531:1 in 2000, At the height of the
stock market bubble, when CEOs were cashing in big stock options:
CEOs pay as a multiple of the average worker’s pay (1960-2007)
Source: Executive Excess 2008, the 15th Annual CEO Compensation Survey from the Institute for policy studies & united
for a Fair Economy.
The crisis brought to the forefront the enormous difference in the growth rate of CEO pay as against that of the
average worker. In 2010, the average annual wage for US worker in production operation was USD 33,770 while the
average CEO pay in S&P 500 companies was USD 11,358,445. This meant that CEO pay was 336 times more than the

43


average employee. While the ratio may be shocking on its own, the growth in the disparity of the average worker’s pay &
that of the CEO truly boggles the mind. The ratio of CEO pay to factory worker pay rose from 42:1 in 1960 to as high as
53:1 in 2000, at the height of the stock market bubble, when CEOs were cashing in big stock options. It was at 411:1 in
2005 & 344:1 in 2007, according to research by United for a Fair Economy. The fact that organizations that put in place
pay-for-performance structures for employees, while seemingly paying their CEOs for non-performance in the form of a
variety of perks & benefits which went from rational to ridiculous, caught the ire of the general public. There is still hope
though; the last couple of years have seen drastic cuts in CEO compensation, mostly in the areas of the use of corporate jet
for personal reasons, and in terms of club membership & personal security.

Many potential causes of overpayment have been identified:
CEOs with too much power, inattentive boards of directors, conflicts of interest by compensation consultants, and the use of
stock options the list goes on.
Some studies show the average CEO was paid $10 million to $ 15 million in 2005. This includes their salary, bonus,
stock option gains, stock grants, and various executive benefits & perquisites
If there is an excessive CEO pay problem, we won’t fix the problem by measuring the wrong things & then
misinterpreting flawed calculations.

- SWATI PUROHIT

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MARKETING
Benefit segmentation
The process of grouping users into market segments on the basis of the desirable consequences sought from the product.

De-marketing
The process of reducing the demand for a product or decreasing its consumption.

Destination merchandise
A type of merchandise that motivates or triggers a trip to a specific store.
andise

Eighty-twenty principle
The situation in which a disproportionately small number of staff, products or users generate a disproportionately large
amount of a firm's use/profits.

Galley proof
A copy of the individual pages of an ad, brochure, poster or other printed material used for final proofreading of the text
before final negatives are made for the printing process.

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Mores
The cultural norms that specify behavior of vital importance to society and embody its basic moral values.

Reilly's law
A model used in trade area analysis to define the relative ability of two cities to attract users from the area between them.

- KAVYA JAIN

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FINANCE
Input Tax-
When a company that is registered for value added tax (VAT) buys goods or services from another supplier, VAT charged
is known as input tax.

Absolute priority-
Rule in bankruptcy proceedings whereby senior creditors are required to be paid in full before junior creditors receive any
payment.

Balloon maturity-
Any large principal payment due at maturity for a bond or loan with or without a sinking fund requirement.

Bank anticipation notes (BAN)-
Notes issued by states and municipalities to obtain interim financing for projects that will eventually be funded long term
through the sale of a bond issue.

Bank collection float-
The time when the bank is collecting payment from the payers’ bank to provide the funds to the depositor on behalf of the
cheque deposited

Level-coupon bond-
Bond with a stream of coupon payments that are the same throughout the life of the bond.

- SUPRIYA SINGH

47


Latest Important Banking Sector Data

6.00% (w.e.f.
Bank Rate
29/04/2003)

Increased from 5.00% to 5.50% wef 13/02/2010; and then
6.00% (w.e.f.
Cash Reserve Ratio (CRR) again to 5.75% wef 27/02/2010; and now to 6.00% wef
24/04/2010)
24/04/2010

Decreased from 25% which was continuing since
Statutory Liquidity Ratio (SLR) 24% (w.e.f. 18/12/2010)
07/11/2009

8.50% (w.e.f. Increased from 7.50% which was continuing since
Repo Rate under LAF
25/10/2011) 03/05/2011

7.50% (w.e.f. Increased from 6.50% which was continuing since
Reverse Repo Rate under LAF *
25/10/2011) 16/06/2011.

4.00% (w.e.f. Increased from 3.50%, which was continuing since 1st
Saving Deposits - Interest Rate
03/05/2011) March, 2003

48


HUMAN RESOURCE

Balanced Scorecard
The goal of the balanced scorecard is to tie business performance to organizational strategy by measuring results in four
areas: financial performance, customer knowledge, internal business processes, and learning and estimating growth.

Broad banding
A pay structure that consolidates a large number of narrower pay grades into fewer broad band’s with wider salary ranges.

Bumping
The practice of allowing more senior level employees whose positions have been slotted for elimination or downsizing the
option of accepting an alternative position within the organization, for which they may be qualified to perform and which is
currently occupied by another employee with less seniority.

KPI’s
Key Performance Indicators, tasks that have been agreed between an employee and line manager/HR with an expectation
that they will be completed satisfactorily in the time agreed or as an ongoing task.

Nepotism
Favoritism showed towards relatives by the individuals at a position of authority such as CEOs, managers and supervisors.
- SUPRIYA SINGH

49


FUN MANIA

- RAHUL MISHRA
(ALUMNUS)

50

Epitome jan. 2012

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