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Examination Paper of Human Resource Management
IIBM Institute of Business Management
Examination Paper MM.100
Human Resource Development & Training
Section A: Objective Type & Short Questions (30 marks)
This section consists of Multiple Choi ces and Short Notes Type Questions.
Answer all the questions.
Part one carries 1 mark each & Part Two carries 5 marks each.
Part One:
Multiple choices:
1. HRD is the process of helping people to acquire________
a. Competition
b. Completeness
c. Competencies
d. None of the above
2. Techniques of human resource development are also called_______
a. HRD Methods
b. HRD Instruments
c. HRD Mechanism
d. All of above
3. In India HRD began only in______
a. 1970s
b. 1980s
c. 1910s
d. 1990s
4. BARS Stand for______
a. Behaviorally Anchored Rating Scale
b. Behaviorally Anchoring Rating Scale
c. Behaviorally Appraisal Rating Scale
d. None of the above
5. Levels of evaluations of Training programme are:
a. 7
b. 6
c. 5
d. 10
6. Performance appraisal in a _________process of identifying, planning, developing
employee Performance.
a. Multi-Stages
b. Single-Stages
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IIBM Institute of Business Management
Examination Paper of Human Resource Management
c. Dual-Stages
d. All of the above
7. Halo effect is the tendency to the judge all aspects of a________
a. Person’s behaviour
b. Perspective behaviour
c. Performance appraisal
d. All of the above
8. QWL Stand for_______
a. Quality of work life
b. Quality of worker life
c. Quantity of work life
d. None of the above
9. 360- degree feedback can be used s a tool for performance_______
a. Appraisal
b. Analyze
c. Assessment
d. None of the above
10. Career planning is a _______that constitute what a person does for a living.
a. Sequence of career
b. Sequence of jobs
c. Sequence of sum
d. None of the above
Part Two:
1. Discuss the various methods of Appraisal?
2. Briefly explain ‘On the job and Off the job’ methods of Training and Development.
3. Explain the objectives of ‘Performance Appraisal’.
4. Differentiate between HRM and HRD concept.
END OF SECTION A
Section B: Case lets (40 marks)
This section consists of caselets.
Answer all the questions.
Each Caselets carries 20 marks.
Detailed information should from the part of your answer ( Word limit 150 to 200 words.)
Case let 1
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Examination Paper of Human Resource Management
Introduction to the Organization:
XYZ Company was established 20 years ago, to manufacture gearbox components for diesel engines.
It employs around 250 people, having a head office, which employs a wide range of personnel who
are generally well educated and enthusiastic about their work, and a factory, which employs semiskilled
local people who are generally disinterested in the products of the company and who have an
instrumental attitude to work, seeing salary as the only reward.
Brief Description of the Problem:
The performance of the company has not been good and the records revealed the following facts:
Wastage within the factory was costing the company approximately Rs.100,000 a month.
There was wide spread differences in individual work standards.
Processes were non-standardized resulting in repeated problems.
Management made all decisions and cascaded the results down to employees.
The top management become concerned about the performance of the factory and they hired.
Mr. Tanmoy Deb, an OD consultant to study the problem and suggest specific changes to
relationship and tasks with the following objectives:
To review and improve communication systems.
To restructure the organization and to review teamwork and quality practices.
To review leadership issues across all levels.
Mr. Tanmoy Deb carried out discussions, interviews and surveys and made the following
observation:
There’ and ‘us’ attitude was widely prevalent between head office and factory personnel.
Production personnel lacked technical skills.
Factory employees felt alienated from sharing the Company’s success.
Production systems were adhoc and defective because of frequent variation in standards set.
Many times raw material was found to be of inferior quality.
Rigidly defined job descriptions.
Questions:
1. What in your view are the central human resource issues involved in this case?
2. What Strategy should Mr. Tanmoy Deb develop and implement for improving the present system?
Case let 2
Introduction to the Organization:
XYZ Company is an existing profit making FMCG Company. The company has 600 personnel and
has branches all other the country. It has a separate training department with a Training Manager, Mr.
A.P. Mohan as its head who is supported by two qualified training officers. Mr. Mohan has been in
the company for the last 8 years and is very efficient.
Brief Description of the problem:
Mr. Mohan wants to have the organization. He is fed up with organization politics. He is dissatisfied and
in fact frustrated. There are several reasons attachment to it. First and foremost is that he is not paid
adequately despite the fact that he has brought 12% growth in revenue to the company. Second reason is
that he is not consulted and constantly neglected while making decision on training aspects. Lastly, he
considers himself to be a victim of politics played in the organization. Production Manager
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Examination Paper of Human Resource Management
is constantly hurting him and interferes with the work. Dr. Ashok Sarao, boss of Mr. A.P. Mohan does
not want him to leave the organization, as he known that the effectively will come down if he leaves
Dr. Ashok tries to convince Mohan that he should adjust himself with the environment and also talk of
how Mohan is constantly neglected. He talks of how politics is played in the organization and
strengths and weaknesses of Mohan but does nothing to convince Mohan. Rather he says that they
have to adjust, as they are part of family run business. In this setting, personal equation rather than
merit works. Mohan is not convinced and says he is leaving.
Questions:
1. Why a high performer like Mr. Mohan decided to leave the organization he has been long part of?
2. Do you think Mr. A.P. Mohan took the right decision to leave the organization? What would you
have done if you were in his shoes?
END OF SECTION B
Section C: Applied Theory (30 marks)
This section consists of Applied Theory Questions.
Answer all the questions.
Each questions carry 15 marks.
Detailed information should from the part of your answer (Word limit 200 to 250 words).
1. What do you mean by Quality of Work Life? Discuss the various techniques for improving
the Quality of work life with the principles of QWL?
2. Discuss the basic concepts of management development. What is the important of
management development in the changing business?
END OF SECTION C
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IIBM Institute of Business Management
Examination Paper of Human Resource Management
IIBM Institute of Business Management
Examination Paper MM.100
Industrial Relations & Labour Laws
Section A: Objective Type & Short Questions (30 marks)
This section consists of Multiple choices a nd Short Notes type questions.
Answer all the questions.
Part one carries 1 mark each & Part Two carries 5 marks each.
Part One:
Multiple choices:
1. Workers participation in management decision-making is a highly________ concept.
a. Duplex
b. Complex
c. Simplex
d. None of the above
2. The origin of industrial relations in India can be traced in to the:
a. Second world war
b. First world war
c. Third world war
d. British rule
3. Under the payment of wages act, 1936, no wages period shall exceed for one.
a. Four month
b. Two month
c. One month
d. None of the above
4. Collective bargaining is the process of bargaining between________
a. employees & employer
b. workers & workers
c. employees & employees
d. None of the above
5. Layoff can also cause a ________
a. Retirement
b. Grievance
c. Conflict
d. None of the above
6. As per payment of bonus act, accounting year for a company is ________
a. One year
b. Period for which balance sheet is prepared
c. Period for which cash flow is prepared
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Examination Paper of Human Resource Management
d. Period for which profit and loss account is prepared
7. WPM stands for_________
a. Workers’ Participation in Management
b. Workers’ Payment of Management
c. Well fare Payment of Management
d. None of the above
8. Causes of Industrial disputes are_________
a. Economic causes
b. Political causes
c. Technological causes
d. All of the above
9. Trade unions of workers in an organization formed by workers to protect their________
a. Working condition
b. Interest
c. Both a & b
d. None of the above
10. A grievance causes in any organization are_________
a. Work environment
b. Supervision
c. Work group
d. All of the above
Part two:
1. What are the steps of Grievances handling Process? Explain it.
2. What are the objectives of ‘Industrial Relations’?
3. Briefly explain the term ‘evolution of Trade unions in India’.
4. Explain the ‘workers’ participation in management’.
END OF SECTION A
Section B: Case lets (40 marks)
This section consists of Caselets.
Answer all the questions.
Each Caselet carries 20 marks.
Detailed information should form the part of your answer (Word limit 150 to 200 words).
Case let 1
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Examination Paper of Human Resource Management
Star Automobiles Ltd. Pimpary is in the field of manufacturing of two wheelers. They manufacture and
market mopeds. These are available in the brand names ‘arrow’ and ‘double arrow’ where ‘arrow’ is
their traditional product and ‘double arrow’ is the improved version. The company was started about 20
yrs ago. Their product ‘arrow’ enjoys a reasonably good reputation and they were comfortable in the
market. However, with the entry of the new generation of fuel-efficient mopeds the company started
loosing its market. They immediately started developing the improved ‘double arrow’ but by the time
they came out with this new model the competitors had already strengthened their position in the
market. The arrow model was still acceptable by a segment of the market as it was cheapest vehicle.
‘Double arrow’ is new generation vehicle. It was costlier than Jet but its performance was much
superior. It is compared favorably with the competitors’ products; however it was yet to gain a foot hold
in the market.
The company had to refurbish the marketing activities in order to get back their market share. They
employed young sales engineer to launch a strong sales drive. Mr. Ramesh Tiwari, Btech and a diploma
holder in marketing got selected and was put on the job. Mr. Ramesh Tiwari started well in his new job.
He was given a territory to contact the prospective customers’ and to book the orders. The company had
introduced a new financial assistance scheme. Under this scheme, buyers were given easy loans. It was
particularly advantageous for group booking by employees working in an organization. Mr. Ramesh
Tiwari was able to contact people in different organization, arrange for group bookings and facilitate
the loans. His performance was good in the first year and in the second year of his service. The
company had its own system of rewarding those whose performance happened to be good. They usually
arranged a paid holiday trip for the good performer along with his wife. Mr. Ramesh Tiwari was
accordingly informed by the marketing manager to go to Chennai with his wife on company expenses.
Mr. Ramesh Tiwari asked him as to how much it would cost to the company. The marketing manager
calculated and told him that it would cost about 8000/-. He quickly asked him whether he could get that
8000/- in cash instead of the trip as he had better plans. The marketing manager countered this saying
that it might not be possible to doso. It was not the trading of the company, however he would check
with the personnel manager. After a couple of days, Mr. Tiwari was informed that it would not be
possible to give him a cash reward. Mr. Tiwari grudgingly went for the trip and returned. On his return,
he was heard complaining to one of his colleagues his little daughter was also along with him. The
marketing manager and the personnel manager thought he was a bit too fusy about the money and some
of his colleagues also thought so. During the subsequent days Mr. Ramesh Tiwari’s performance was
not all that satisfactory this showed his lukewarm attitude towards his job and the subordinates.
Questions:
1. Did the personnel manager handle the issue properly?
2. What is your recommendation to avoid such situations in future?
Case let 2
In 1950, with the enactment of the Insurance Act, Government of India decided to bring all the
insurance companies under one umbrella of the Life Insurance Corporation of India (LIC). Despite the
monopoly of LIC, the insurance sector was not doing well. Till 1995, only 12% of the country’s people
had insurance cover. The need for exploring the insurance market was felt and consequently the
Government of India set up the Malhotra Committee. On the basis of their recommendation, Insurance
Development and Regulatory Authority (IRDA) Act was passed in parliament in 2000. This moved
allowed the private insurers in the market with the strong foreign partners with 74:26% stakes. XYZMoon
life was one of the first three private players getting the license to operate in India in the year
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Examination Paper of Human Resource Management
2000. XYZ Moon life Insurance was a joint venture between the XYZ Group and Moon Inc. of US.
XYZ started off its operations in 1965, providing finance for industrial development and since then it
had diversified in to housing finance, consumer finance, mutual funds and now its latest venture was
Life Insurance. Its foreign partner Moon Inc. had its presence in Asia since the past 75 years catering to
over 1 million customers across 11Asian countries. Within a span of two years, twelve private players
obtained the license from IRDA.IRDA had provided certain base policies like, Endowment Policies,
Money back Policies, Retirement Policies, Team Policies, Whole Life Policies, and Health Policies.
They were free to customize their products by adding on the riders. In the year 2003, the company
becomes one of the market leaders amongst the private players. Till 2003, total market share of private
insurers was about 4%, but Moon Life was performing well and had the market share of about 30% of
the private insurance business. In June 2002, XYZ Moon Life started its operations at Nagpur with one
Sales Manager(SM) and ten Development Officers (DO). The role of a DO was to recruit the agents and
sell a career to those who have an inclination towards insurance and could work either on part time or
full time basis. They were very specific in recruiting the agents, because their contribution directly
reflected their performance. All DOs faced three challenges such as Case Rate (number of policies),
case size (amount of premium), and recruitment of advisors by natural market, personal observations,
nominators, and centre of influence. Incentive of offered by the company to development officers and
agents were based on their performance, which resulted in to internal competition and finally converted
into rivalry. In August 2002, a branch manager joined along with one more sales manager and ten
development officers. Initially, the branch was performing well and was able to build their image in the
local market. As the industry was dynamic in nature, there were frequent opportunities bubbling in the
market. In order to capitalize the outside opportunities, one sales manager left the organization in
January 2003. As the sales manager was a real performer, he was able to convince all the good
performers at XYZ Moon Life Insurance to join the new company. In april 2004, the company faceda
grave problem, when the Branch Manager left the organization for greener pastures. To fill the position,
in May 2004, the company appointed a new branch manager, Shashank Malik, and a sales manager,
Rohit pandey. The branch manager in his early mthirties had an experience of sales and training of
about 12 years and was looking after two branches i.e., Nagpur and Nasik. Malik was given one
Assistant Manager and 25 Development Officers. Out of that, ten were reporting to him. He was given
the responsibility of handling all the operations and the authority to make all the decisions, while
informing the Branch Manager. Malik opined that the insurance industry is a sunrise industry where
manpower plays an important role as the business is based on relationship. He wanted to encourage
one-to-one interaction, transparency and discipline in his organization. While managing his team, he
wanted his co-workers to analyze themselves i.e., to understand their own strengths and weaknesses. He
wanted them to be result-oriented and was willing to extend his full support. Finally, he wanted to
introduce weekly analysis in his game plan along with inflow of new blood in his organization. Using
his vast experience, he began informal interactions among the employees, by organizing outings and
parties, to inculcate the feelings of friendliness and belonging. He wanted to increase the commitment
level and integrity of his young dynamic team by facilitating proper channelization of their energy. He
believed that proper training could give his team a proper understanding of the business and the
dynamics of insurance industry.
Questions:
1. If you were Malik, what strategies would you adopt to solve the problem?
2. With high employee turnover in insurance industry, how can the company retain a person like Malik?
END F SECTION B
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Examination Paper of Human Resource Management
Section C: Applied Theory (30 marks)
This section consists o f Applied Theory Questions.
Answer all the questions.
Each question carries 15 marks.
Detailed information should form the part of your answer (Word limit 200 to 250 words).
1. What is the Collective Bargaining? Explain the Characteristics and types of Collective
Bargaining and write down the different levels of Collective Bargaining?
2. Discuss the wage policy in India with reference to detailed evaluation of the act.
END F SECTION C
S-2-300813
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Examination Paper of Supply Chain Management
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IIBM Institute of Business Management
IIBM Institute of Business Management
Examination Paper MM.100
Supply Chain Management
Section A: Objective Type & Short Questions (30 Marks)
This section consists of Multiple Choi ce & Short Notes type questions.
Answer all the questions.
Part One carries 1 mark each & Part Two carries 2 marks each.
Part One:
Multiple Choices:
1. When demand is steady, the cycle inventory for a given lot size (Q) is given by_____
a. Q/4
b. Q/8
c. Q/6
d. Q/2
2. There are two firms „x‟ and „y‟ located on a line of distance demand(0-1) at „a‟ and „b‟
respectively, the customers are uniformly located on the line, on keeping the fact of splitting of
market, the demand of firm „x‟ will be given by,
a. (a+b)/2
b. a+(1-b-a)/2
c. (1+b-a)/2
d. a+(a-b)/2
3. Push process in supply chain analysis is also called_______
a. Speculative process
b. Manufacturing process
c. Supplying process
d. Demand process
4. If the Throughput be „d‟ and the flow time be „t‟ then the Inventory „I‟ is given by______
a. I *d=t
b. I=t+d
c. d=I*t
d. I =d*t
5. Forecasting method is_______
a. Time series
b. causal
c. Qualitative
d. All the above
6. Component of order cost include:
a. Handling cost
Examination Paper of Supply Chain Management
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IIBM Institute of Business Management
b. Occupancy cost
c. Receiving costs
d. Miscellaneous costs
7. How many distinct types of MRO inventory are there:
a. One
b. Four
c. Three
d. Two
8. Supply chain driver is________
a. Inventory
b. Return ability
c. Fulfillment
d. All of above
9. SRM stands for________
a. Strategic Relationship Management
b. Supply Return ability Management
c. Supplier Relationship Management
d. None of the above
10. Discount factor equals to, where k is the rate of return.
a. 1/1+k
b. 2/1+k
c. 1/1-k
d. 1/2+k
Part Two:
1. Explain “zone of strategic fit”.
2. Explain “scope of strategic fit”.
3. What do you understand by “stimulation forecasting method”?
4. Write a note on “obsolescence (or spoilage) cost”.
5. Define “square law” in safety inventory of supply chain management.
6. What does the word “postponement” signifies in supply chain?
7. What do you understand by the term “tailored sourcing”?
8. Explain the term “outsourcing”.
9. Write a note on “threshold contracts” for increasing agent efforts.
10. What is “dynamic pricing”?
END OF SECTION A
Examination Paper of Supply Chain Management
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IIBM Institute of Business Management
Section B: Caselets (40 marks)
This section consists of Caselets.
Answer all the questions.
Each caselet carries 20 marks.
Detailed information should form the part of your answer (Word limit 200 to 250 words).
Caselet 1
Orion is a global co. That sells copiers. Orion currently sells 10 variants of a copier, with all inventory
kept in finished-goods form. The primary component that differentiates the copiers is the printing
subassembly. An idea being discussed is to introduce commonality in the printing subassembly so
that final assembly can be postponed and inventories kept in component form. Currently, each copier
costs $1,000 in terms of components. Introducing commonality in the print subassembly will increase
component cost to$1.025.One of the 10 variants represents 80 percent of the total demand. Weekly
demand for this variant is normally distributed ,with a mean of 1,000 and a standard deviation of
200.Each of the remaining nine variants has a weekly demand of 28 with a standard deviation of
20.Orion aims to provide a 95per level of services .Replacement lead time for components is four
weeks. Copier assembly can be implemented in a matter of hours. Orion manages all inventories
using a continuous review policy and uses a holding cost of 20 percent.
1. How much safety inventory of each variant must Orion keep without component commonality?
What are the annual holding costs?
2. How much safety inventory must be kept in component form if Orion uses common components
for all variants? What is the annual holding cost? What is the increase in component cost using
commonality? Is commonality justified across all variants?
3. At what cost of commonality will complete commonality be justified?
4. At what cost of commonality will commonality across the low-volume variants be justified?
Caselet 2
An electronic manufacturer has outsourced production of its latest MP3 player to a contract
manufacturer in Asia. Demand for the players has exceeded all expectations whereas the contract
manufacturers sell three types of players- a 40-GB player, a 20-GB player, 6-GB player. For the
upcoming holiday season, the demand forecast for the 40-GB player is normally distributed, with a
mean of 20,000and a standard deviation Dard deviation of 11,000, and the demand forecast for the 6-
sGB player has a mean of 80,000 and a standard deviation of 16,000. The 40-GB player has a sale
price of $200, a production cost of $100, and a salvage value of $80 .The 20-GB player has a price of
$150, a production cost of $70, and a salvage value of $50.
1. How many units of each type of player should the electronics manufacturer order if there are no
capacity constraints?
2. How many times of each type of player should the electronics manufacturer order if the available
is 140,000? What is the expected profit?
END OF SECTION B
Examination Paper of Supply Chain Management
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IIBM Institute of Business Management
Section C: Applied Theory (30 marks)
This section consists of Long Questions.
Answer all the questions.
Each question carries 15 marks.
Detailed information should form the part of your answer (Word limit 150 to 200 words).
1. Consider two products with the same margin carried by a retail store. Any leftover units of one
product are worthless. Leftover units of the other product can be sold to outlet stores. Which
product should have a higher level of availability? Why?
2. McMaster-Carr sells maintenance, repair, and operations equipment from five warehouses in the
United States. W.W. Grainger sells products from more than 350 retail locations, supported by
several warehouses. In both cases, customers place orders using the Web or on the phone. Discuss
the pros and cons of the two strategies.
END OF SECTION C
Examination Paper of Supply Chain Management
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IIBM Institute of Business Management
IIBM Institute of Business Management
Examination Paper MM.100
Statistical Quality Control
Section A: Objective Type & Short Questions (30 Marks)
This section consists of Multiple c hoice & Short Note type questions.
Answer all the questions.
Part One carries 1 mark each & Part Two carries 4 marks each.
Part One:
Multiple choices:
1. If in a hall there are 18 persons then how many handshakes are possible.
a. 18*18
b. 18*17/2
c. 18*17
d. None
2. If the number of trials be „n‟ and the probability of occurrence be „p‟ then the standard
deviation with respect to np, is given by?
a. (np)
1/2
b. (np(1-p))
1/2
c. (np)
1/4
d. (np(1-p))
1/4
3. For a biased coin the probability of occurrence of head is 0.4 ,if the coin is tossed twice then
the probability of occurrence of at least one head will be:
a. 0.76
b. 0.48
c. 0.64
d. 0.16
4. Factorial of 5 equals__________
a. 60
b. 120
c. 24
d. 5
5. Combinatory of (4,2) equals_______
a. 12
b. 8
c. 6
d. None
6. “Economic Control of Quality of Manufactured Product‟, a book by Walter A Shewhart in
a. 1931
Examination Paper of Supply Chain Management
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IIBM Institute of Business Management
b. 1941
c. 1930
d. 1956
7. Quality is judged by___________
a. Retailer
b. Government
c. Customer
d. Hole seller
8. A run chart is a special chart of______
a. Pie chart
b. Line chart
c. R chart
d. C chart
9. Universes may differ_____
a. In average
b. In above average
c. At higher level
d. All of the above
10. ASQC and ANSI began in
a. 1956
b. 1976
c. 1978
d. 1960
Part Two:
1. Differentiate between „defect‟ and „defective‟.
2. Explain the need of „short method‟.
3. What does „Tchebycheff‟s inequality theorem‟ say?
4. Explain the usability of „stochastic limit‟.
5. Write a note on „Cause and Effect‟ diagram.
END OF SECTION A
Section B: Caselets (40 marks)
This section consists of Caselets.
Answer all the questions.
Each caselet carries 20 marks.
Detailed information should form the part of your answer (Word limit 200 to 250 words).
Examination Paper of Supply Chain Management
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IIBM Institute of Business Management
Caselet 1
ADAPTABILITY IN ACTION: A CASE OF RSL
Rajasthan Synthetics Ltd. (RSL) was established in the year 1994 at Bhilwara, Rajasthan to
manufacture synthetic yarn with a licensed capacity of 29,000 spindles. Manish Kumar, a Harvard
Business School graduate, established RSL with 8% equity participation from Itochu Corporation
Japan to manufacture synthetic yarn for shirting, a promising business at that time. The demise of the
NTC textile mills was fresh in the minds of the promoters and therefore, state of the art technology
imported from U.K., Germany, Japan and France was used in the manufacturing facility. By the time
the company started manufacturing yarn the competition in shirting yarn had become fierce and the
returns had diminished. The company incurred losses in the first four years of its operations and the
management was looking for opportunities to turn things around. The manufacturing plant started
functioning with an installed capacity of 26,000 spindles, a small unit considering yarnmanufacturing
industry, in the year 1996 to manufacture synthetic yarn for shirting only. Initially, the
major fabric manufactures of India such as Raymonds, Donear, Grasim, Amartex, Siyaram, Pantaloon
and Arviva were the main customers of the company and the total produce of the company was sold
within the domestic market. These fabric manufactures used to import the premium quality yarn
before RSL started supplying the yarn to them. The company in the first year of its operations
realized that shirting yarn was one of the fiercely competitive products and the company with its high
interest liability was unlikely to earn the desired profits. Also, the company had a narrow product mix
limited to only two more blow room lines were installed in the first quarter of 1997. The addition of
two blow room lines helped RSL to manufacture four different types of yarns at the same time.
Utilizing this added flexibility, RSL began manufacturing yarn for suitings.Since the suiting yarn was
providing better returns, the company was keen to increase manufacturing of suiting yarn but was
hampered by the two for one doubling (TFO) facility, which was limited to only 40% of the total
produce. To remove this bottleneck, 12 more TFO machines were added to the existing 8 TFO
machines. The addition of these machines increased the doubling capacity to 70% of the production
providing additional product mix flexibility to the company. This enabled the company to
manufacture yarn to cater to the requirements of suiting, industrial fabric and carpet manufacturers. In
the initial years of its operations, RSL realized that the promises made by the Government of
Rajasthan to provide uninterrupted power supply of the required quality (stable voltage and
frequency) and ample quantity of water were unlikely to be met through the public distribution
system. The voltage and frequency of electric power provided through the public distribution system
were erratic and frequent announced and unannounced power cuts stopped production on a regular
basis. In these circumstances, meeting quality requirements of the customers and adhering to delivery
schedules was a herculean task. To ensure smooth and uninterrupted operations RSL installed inhouse
power generation facility of 4 megawatts capacity and dug 10 tube-wells.RSL faced stiff
competition in the domestic market from Gujarat Spinning and Weaving Mills, Surat, Rajasthan
Textile Mills, Bhawani Mandi, Charan Spinning Mills, Salem and Indorama Synthetics Ltd.,
Pithampur in all their product categories and the returns were low. In order to combat stiff
competition in the domestic market and improve returns the company started developing export
markets for their products in the year 1998. Initially, RSL started exporting carpet yarn to Belgium
and till 2001; carpet yarn formed the major component of their exports. A trade agreement was signed
with Fibratex Corporation, Switzerland to share profits equally for expanding their overseas
operations. During the same period, RSL continued to scout for new export markets and was
successful in entering top-of-the-line fancy for premium fashion fabric manufactures of international
repute like Mango and Zara. Rajasthan Synthetics Ltd. also exported fancy yarn to a number of fabric
manufacturers located in Italy, France, England, Spain and Portugal. Yarn manufacturers from
Indonesia, Korea and Taiwan gave stiff competition to RSL when it entered the international market.
The companies from South Asian countries had a major cost advantage over RSL because of cheap,
uninterrupted availability of power and high labour productivity. Currencies had been sharply
devalued during the South Asian financial crisis, which rendered the products manufactured by these
Examination Paper of Supply Chain Management
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IIBM Institute of Business Management
companies still cheaper in international markets. Despite all these disadvantages, RSL was able to
gain a foothold through constant adaption of their products according to the customer requirements in
the highly quality conscious international yarn market and was exporting 95% of its total produce by
the beginning of the year 2002.
Rajasthan Synthetics Ltd. had fine-tuned its distribution channels according to the type of markets
and size of orders from the customers. In line with this policy the export to Middle East, Far East and
Turkey was carried out through agents. Similarly, low volume export of fancy yarn requirements was
also catered through agents. While dealing with importers directly, RSL strictly followed the policy
of exports against confirmed Letter of Credits only. The company directly exported to important
clients in Belgium, England and France. The domestic market was also served through an agency
system. Rajasthan Synthetics Ltd. considered inventories as an unnecessary waste and kept minimum
possible inventories while ensuring required level of service. To ensure that the inventories were held
to a minimum, the manufacturing plan consisted of 60 to 70% against customer orders, 30 to 40%
against anticipated sales and 2% capacity was reserved for new product development. A Strategic
Management Committee (SMC) consisting of MD, CEO, GM (marketing) and GM (technical)
reviewed the production plan of the manufacturing plant on quarterly basis. The SMC also developed
the plans for profitability, product mix and cost minimization. Delivering high-quality products and
meeting delivery commitments for every shipment were essential pre-requisites to be successful in the
global market place. The company had understood this very early and to ensure that the products
manufactured by RSL met the stringent quality requirements of its international customers, the
company had developed a full-fledged testing laboratory equipped with ultra modern testing
machines like User Tester-3 and Classifault. The company had stringent quality testing checks at
every stage of tarn production right from mixing of fiber to packing of finished cones. Its in-house
Research and Development and Statistical Quality Control (SQC) divisions ensured consistent
technical specifications with the help of sophisticated state-of-the-art machines. A team of
professionally qualified and experienced personnel to ensure that the yarn manufactured by the
company was in line with international standards backed the company. The company continuously
upgraded its product mix and at the same time, new products developed by in-house research and
development department were added to the product mix form time to time. RSL‟s management was
quick to analyze the potential of these in-house developments and followed a flexible approach in
determining the level of value addition. The company had developed a new yarn recently and was
selling it under the Rajtang brand name. This new yarn was stretchable in three dimensions, absorbed
moisture quickly, was soft and silky and fitted the body. This yarn was extracted from natural
products and being body-friendly, was in great demand in international markets. Looking at the
higher value addition possibilities RSL decided to forward integrate and started manufacturing fabric,
using Rajtang and provided ready-made garments like swimming suit, tracksuit, undergarments, tops,
slacks and kids dresses. The ready-made dresses from the fabric were being manufactured on the
specifications and designs of RSL. The management decided to market these products under the
brand name “Wear-it” through Wearwell Garments Pvt. Ltd., an associate company of RSL, to ensure
that RSL did not lose its focus. The Managing Director of RSL felt that continuous adaptability to
market requirements through a flexible approach, cost cutting in every sphere of operations and team
approach to management had taken them ahead. However, RSL had become highly dependent on the
volatile export market and if it was not able to retain the international market it would have to reestablish
itself in the domestic market, which was not an easy task.
1. What marketing strategy should RSL adopt to remain competitive in the international market?
2. Has the company taken the right decision to forward integrate and enter into the highly volatile
garment market?
Caselet 2
Examination Paper of Supply Chain Management
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IIBM Institute of Business Management
Popular mythology in the United States likes to refer to pre-World War II Japan as a somewhat
backward industrial power that produced and exported mostly trinkets and small items of dubious
quality bought by Americans impoverished by the Great Depression. Few bring up the fact that, prior
to the Pearl Harbor attack, Japan had conquered what are now Korea, Manchuria, Taiwan, and a large
portion of China, Vietnam, and Thailand; and by the end of 1942 Japan had extended its empire to
include Burma, the Philippines, Indonesia, Malaysia, Thailand, Cambodia, New Guinea, plus many
strings of islands in the eastern Pacific Ocean. Its navy had moved a large armada of worships 4,000
miles across the Pacific Ocean, in secret and in silence, to attack Pearl Harbor and then returned
safely home. Manufacturers capable of producing only low-grade goods don‟t accomplish such feats.
High-quality standards for military hardware, however, did not extend to civilian and export goods,
which received very low priority during the war years. Thus the perception in the United States for a
long time before and then immediately after the war had nothing to do with some inherent character
flaw in Japanese culture or industrial capability. It had everything to do with Japan‟s national
priorities and the availability of funds and material. Following Japan‟s surrender in 1945, General
MacArthur was given the task of rebuilding the Japanese economy on a peaceful footing. As part of
that effort an assessment of damage was to be conducted and a national census was planned for 1950.
Deming was asked in 1947 to go to Japan and assist in that effort. As a result of his association with
Shewhart and quality training, he was contacted by representatives from the Union of Japanese
Scientists and Engineers (JUSE), and in 1950, Deming delivered his now famous series of lectures on
quality control. His message to top industry leaders, whom he demanded to attend, and to JUSE was
that Japan had to change its image in the United States and throughout the world. He declared that it
could not succeed as an exporter of poor quality and argued that the tools of statistical quality control
could help solve many quality problems. Having seen their country devastated by the war, industry
and government leaders were eager to learn the new methods and to speed economic recovery.
Experience was to prove to Deming and others that, without the understanding, respect, and support
of management, no group of tools alone could sustain a long-term quality improvement effort.
1. How could have the SQC approach, been useful in solving the immediate problems of Japan?
2. If you were among one of the management members, what would have been your first insight?
END OF SECTION B
Section C: Practical Problems (30 marks)
This section consists of Long Questions.
Answer all the questions.
Each question carries 15 marks.
1. A sample of 30 is to be selected from a lot of 200 articles. How many different samples are
possible?
2. In Dodge‟s CSP-1, it is desired to apply sampling inspection to 1 piece out of every 15 and to
maintain an AOQL of 2%. What should be the value of i?
S-2-300813
END OF SECTION C
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