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CHAPTER:-1
INTRODUCTION OF COMPANY
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OVERVIEW
Corporate head: - ITI DOORVANINAGAR, BANGALORE
Manufacturing units: - Bangalore (Karnataka)
Naini (near Allahabad UP)
Rae Bareli (UP)
Mankapur (UP)
Palakkad (Kerala)
Srinagar (Jammu & Kashmir)
Network system unit: - Bangalore
Regional officers: - New Delhi
Bangalore
Kolkata
Lucknow
Mumbai
Chennai
Hyderabad
Bhubaneswar
Bhopal
Ahemdabad
Kochi
Supported by 36 area offices all over the country
Manpower : - 1294
R&D : - Bangalore, Naini, & Mankapur
Quality system: - ISO 9000:2000, ISO 14001:2004
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ITI A GLIMPSE
ITI Ltd is Indias largest and first public sector unit developed to manufacture
telecommunication products with the latest technology. This is bedrock upon which
India is launching its contribution to the worlds telecommunication revolution. ITI
Ltd is the premier public sector undertaking of the country. It was the first public
sector unit to be opened by government of India after independence in the year
1948-49. It was located at Bangalore. The activities of this public sector were
manufacturing mechanical telephone instrument & exchanges Due to advancements
in technology in the field of electronics, ITI started its expansion program in the field
of electronic in 60s.
Communication is our business was the motto adopted by ITI. With this
motto in mind, ITI started its business in communication field. From a small
beginning, it has grown in to a month multiunit enterprise with manufacturing units at
Doorvani Nagar & electronics city in Bangalore, Mankapur, Naini, & Rae Bareli in
UP, Pallakad in Kerala & Srinagar in J & K, in addition to these manufacturing unit
located at Bangalore for undertaking installation & maintenance of
telecommunication equipments through the country which is now renamed as
Network communication Business group. The company has a strong in house R & D
infrastructure attached to the independent business group. The main R & D divisions
are located at Bangalore & Naini. Looking forward at the technology, the R & D is
engaged in continuous development & absorption technology.
A large number of companys products are covered under the Self
Certification Scheme by the major consumer i.e. Department of Telecommunication.
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ITI IS KNOWN FOR
Manufacturing of telecommunication equipments
Value added services
Turnkey projects.
Network management
Research and Development
Mobile Radio Trunked service
Software Application.
MISSION
To be the leader in the domestic market and an important global player in
voice, Data and Image communication by providing total solution to customer. To
build on core competencies to enter business areas.
Organisation chart
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Chairman & Managing Director
K.L. Dhingra.
Director (Marketing)
R.K. Agrawal
Director (Finance)
Ravi Khandelwal
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Director (Production)
K.K. Gupta
Director
N.K. Joshi
Director
S.P. Kochar
Company Secretary
Mrs. Rachana Chaudhary.
Independent Director
Prof. M. Balakrishan
Mr. T.S. Narayanasami
Dr. S.K. Chaudhuri.
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MANAGEMENT OF CHAIN
Ministry of Telecommunication
Chairman Managing Directors
Board of Directors
Executive Directors (EDR)
General Manager (Head of unit)
Assistant General Manager
Deputy General Manager
Chief Manager
Manager
Deputy Manager
Assistant Manager
Engineer
Assistant Engineer
Staff (Employees)
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CHAIN OF NEW UNITS
In addition to the present unit at Bangalore, manufacturing the telephone &transmission equipment, it has grown in to a multiunit enterprise with other
manufacturing enterprise with other manufacturing units established at Doorvani
Nagar & electronic of Bangalore, Mankapur, Naini, Rae Bareli, Pallakad in Kerala &
Srinagar in Jammu & Kashmir.
The company now manufactures the entire range of telecommunication equipment
right from telephone instruments to equipment for Satellite Earth Stations catering tothe DOT, MTNL, Defense services, Railways & state electricity boards. It also tries
to meet the requirements of the private customers for automatic exchanges.
Besides this ITI also produces the road-traffic signals of high reliability & variety of
tonometry & tele-control equipment. The latest production of ITI today is SDH &
WILL. In future ITI is planning to switch over to ATM from SDH.
Apart from supplying to the domestic market ITI has also taken up Turnkey projects
abroad & has been exporting its products as many as 20 other countries. The
company has received fewer tenders as compared to global competition. On the basis
of its quality & price, it is striding towards attaining organizational excellence.
ITI is today n market-oriented company, growing in to total solution provider. It is
striving towards achieving excellence.
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SPECIAL ACHIEVEMENT
During the year under review, the company has produced 3.06 million lines ofswitching equipments that included 200kl of new C-DOT MAX XL Exchange.
Bulk production of SMPS to tune of Rs 28.70 crore & bulk production of Digital
Microwave (SDH) equipments were its major achievements. Optical fiber systems
(SDH), being newly inducted in the Indian network were supplied for the first time.
The company is placed first for supply of 1.69 million line of new technology
exchange & for supply of 770 numbers of 2/140 Mbs Optimux along with
regenerator.
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PLANTS
1. BANGALORE PLANT (Established in 1950)
2. SRINAGAR PLANT (Established in 1970)3. NAINI, ALLD PLANT (Established in 1971)
4. RAE BARELI PLANT (Established in 1973)
5. PALAKKAD PLANT (Established in 1975)
6. MANAKAPUR PLANT (Established in 1980)
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AWARDS
Excellent performance PSE awards in the year 1997-98 given by INDIAN
INSTITUTE OF INDUSTRIAL ENGINEERING.
Best CHIEF EXECUTIVE GOLD AWARD by INTERNATIONAL GREEN L &
SOCIETY on September 17, 1998.
FACT MKK NAIR PRODUCTIVITY AWARD by KERALA STAT
PRODUCTIVITY COUNCIL.
INSPECTION SCHEME (AIS) of PALAKKAD plant has been certified underAPPROVER SUPPLEMENT OCB 283 crore equipment to DOT, MTNL.
INDUSTRIAL SAFETY AWARD by NATIONAL SAFETY COUNCIL.
JOINT VENTURES
Widening its area of operation, ITI teamed up with PACIFIC INTERNATIONAL
COMPANY to manufacture micro earth stations. The result is ITI equatorial Satam
Ltd. (IESL); beside this earth station IESL also undertakes turnkey projects in various
parts of the world. ITI Communication Pvt. Ltd. (ITIC) is a joint venture company set
up in Singapore with the main objective of promoting exports of ITI products to other
countries.
Fibcom India Limited, New Delhi, has also made joint venture with NKT Denmark
for SDH/ PDH fiber optical product
The ITI has collaborated with a number of foreign-based companies having the latest
technology. They are as follows.
Name of the Company Country Technology
M/s Siemens/Nee Japan For Marr/ PCM.
M/s Ericson Sweden For level measuring unit.
M/s AWA Australia For SCATS road traffic system.
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M/s Nee Japan For PCM (26 version)
M/s Alcatel France For large digital Switch
M/s Comedge Singapore For cordless phones
ISO 9000 SERIES STANDARDS
The International Organization for Standardization (ISO) is the specialized
international agency for Standardization, at present comprising the national standard
bodies of 91 countries including India. ISO is made up of approximately 180
Technical Committees. Each technical committee is responsible for one many areas
of specialization.
The object of ISO is to promote the development of standardization & related world
activities with a view to facilitating international exchange of goods & services & to
develop cooperation in the sphere of intellectual, scientific, technological & economic
activity. The results of ISO technical work are published as international standards.
WHY THEY SHOULD BE USED?
The ISO 9000 is an opportunity & a challenge to developing nation. They can now
know with a good degree of certainty the level of quality that purchasers expect. They
can also learn the prerequisites & characteristics of good quality assurance & quality
management. The challenge to the developing nation is to motivate processors &
manufacturers to adopt & implement these standards & to establish a credible
national quality registration scheme, which will be recognized by the trading partners.
With the increasing number of markets & industries, third party quality assessment &
registration is becoming a pre-requisite for doing the business, ISO 9000 is
considered the minimum acceptable level for a supplier, & those who cannot
demonstrate this level may not have difficulty in selling in certain markets; they may
be barred from those markets.
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Without ISO 9000: registration can face higher insurance rates or be denied insurance
in some markets. In addition 9000: series standards also
Motivates exporters
Sets a baseline
Establishes reasonable standard for government procurement
Focuses training & professional development
Sets general markets procedure for regulating health & safely
Reduces time consuming audits by customer & regulators
Give marketing advantages & EC 92 positioning
Raises levels of motivation, co-operation, workmanship & quality
awareness
Improves efficiency, reduces scrap & rework
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MAJOR LANDMARKS
YEAR ACHIEVEMENTS1971.72 Start of production.
1973.74 Production of Telephone developed in house.
1980-81 Assoc ham awards for promotion of ancillary
industries
1981-82 Establishment of computer centre
1986-87 Collaborations.
1986-88 Face to update Telephone manufacturing.
Technology & establishment of P.C.B.
1989-90 Single & Double sized P.C.B. & production of
140 mibt optical line equipment & regenerator
in collaboration with M/s Denmark.
1991-92 Introduction of 565-mibt optical line
equipment & manufacturing of in-house
design Telephone model ME-91 & TPS -90
1994 Advanced of optical line equipment.
1995 Implement Q.D.C. & ISO 9000.
1996 Collaboration with M/s Fibcom India Ltd. &
Solar photovoltaic were manufactured.
1997 Developed MARR & manufactured it along
with 8 mbit & 140 mbit opticmux equipment.
1998 Production of DDF focus version.
1999 Started in the worlds latest equipment i.e.
Digital loop Carrier (PDH) & production of
2/15 single channel equipment.
2000 Developed & production of D.L.C. (SDH) &
Access terminal along with the production of
the central office terminal racks.
2001 COT (central office terminal) reckers system.
2002 Development of fiber Distribution frame.
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2003 Development of FORDAR for defence.
2005 Calibnation with AC CATFC for manufacture
of ADSC.
2006 STM-1, STM-4, STM-16
2008 STM-1. STM-4, STM-16, Transmission
equipment DWDM.
CUSTOMERS
About 90% of the ITI products are supplied to BHARAT SANCHAR NIGAM
LIMITED (Formally known as DEPARTMENT OF TELECOMMUNICATION /
DOT). The other significant customers of the company are as follows.
Bharat Sanchar Nigam Limited (BSNL)
Videsh Sanchar Nigam Limited (VSNL)
Maha Nagar Telephone Nigam Limited (MTNL)
Railways
Defence Banks
Corporate
Factories / Offices
Steel/ Power/ Oil Sector
General
Public
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IMPLEMENTATION OF GOVERNMENT POLICY OF ECONOMIC
LIBERALIZATION AND ITS CONSEQUENCES
The monopoly of ITI was broken by Govt. of India in 1991 as by opening the door to
the private sector & thus competition emerged.
ITI has been selling its instrument since 1968 to the Govt. sector, previously the
Telecom sector was under total control of Govt. with change and open door policy of
Govt. selling pattern has been changed therefore ITI has also entered the market and
is facing competition with others. Some major problems faced by ITI are as follows
Missing good professionals in marketing area
Lack of availability of raw material on time
Lack of autonomy to take decision
Need more innovation and technology upgradation
Need more employee support
Large quantity of waste products
Lack of awareness in workers
Fund crisis
Low market potential
REASONS FOR PROBLEM
Faulty Government policy
Non availability of orders
Fund crisis
Excessive overhead expenditure
Lack of publicity and advertisement
Lack of sales promotion schemes
Lack of upto date features as per customers demand
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COMETITIVE BACKGROUND
Till 1991, ITI enjoyed monopoly, but very soon after 1992 the position was
completely changed. It was also one of the sectors that had been liberalized. This
sector was thrown open to the private sector and thus competition stepped in ITI has
been selling basic telephone instruments and transmission equipments since 1968 to
the Govt. sector. Till now, the telecom sector was entirely in the control of the Indian
Govt. but with the liberalization and open door policy the selling pattern changed and
ITI had to face competition with the major players like the following :-Competitors of Telephone instruments:-
BPL
BEETEL
TATA
PANAPHONES
ORPAT
PUNWIRE
BEL
WETSON
Competitors for Radio Equipments:-
ARM
NATALCO
PCL
MCS
PUNWIRE
SHYAMWIRE
Competitors for Transmission Equipments:-
HFCL
DSC (at present TELLABS)
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NATALCO
UTL
BEL HTL
FUJITSU
ALCATEL
Competitors for EPABX System
BPL TELCOM
L & T LIMITED
L G ELECTRONICS
NORTHERN TELECOM
TATA TELECOM
SIEMENS INFORMATICS SYSTEM LIMITED
SAMSUNG ELECTRONIC CORPORATION
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BIO-DATA (ITI-NAINI)
Name - ITI Ltd NainiBusiness address - ITI Ltd Naini
Mirzapur Road, Allahabad 211010
Phone no. - 0532-2687401-07
Fax no. - 0532-2687345, 2686008
Website - itiltd-india.com
Email - [email protected]
Year of registration - 1971
Registered office - New Delhi, Bangalore, Kolkata, Lucknow,
Mumbai, Chennai Hyderabad, Bhubaneswar,
Bhopal, Ahmedabad, Kochi.
Government council - Ministry of Telecommunication. (Govt of
India).
Head of the Unit - Mr. P.K. Gupta.
Employee strength - 1294
Product line - Various models of Telephones & different types
Of Transmission Equipment.
Market - BSNL, VSNL, MTNL, NTPC, ONGC, Railway,
Defence, Corporate & General public
Competitors - HFCL, FIBCOM, BEL, TEJAS, SIEMMEMS,
PUNCOM, HUAWEI, ZTE, ETC.
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MANAGEMENT OF ITI LTD :- NAINI UNIT
UNIT HEAD
Mr. P.K. GUPTA
DEPUTY GENERAL MANAGER (W&C)
Mr. A.K. AGRAWAL
CHIEF MANAGER FINANCE
Mr. R.K. CHAWLA
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ITI Ltd. NAINI
COMPANY PROFILE
ITI Ltd., Naini was established in the year 1971 as the second senior most of the ITI
group. It is one of the giants of the Telecom Industry, which is situated 16 kilometers
from the holy city of Allahabad. It employs a large of staff members including
officers. Since it is situated 16 kms from the main city, it has provided the employees
with buses as the mode of transport. It also provides other facilities like I.T.I. colony
for lodging of the workers, medical facility and schooling facility for the employees
ward etc.
In Naini there are four departments, namely, Telephone Equipment Division (TED),
Telephone Instrument Division (TID), Central Division. Research and Development
(R&D). Beginning with a moderate production of 1.66 crore in 1971 it reached to 306
crore in 1992-93. But in 295-96 it received a major setback just after the
implementation of liberalization policy. During the year the performance of I.T.I.
Naini division dropped drastically. The total sales were estimated at 73 crore in the
year 1995-96 in the 1998-99 the sales boomed to 10 crore.
MANPOWER
Manpower profile as on 1st June 2011:-
OFFICER 791
NON-OFFICER 503
TOTAL STRENGTH 1294
The value, ethics, interpersonal chemistry and congenial working environment make
this organization a cohesive, articulate and goal directed unit. The collective wealth
of experience of the management personnel in the field of production, quality,
control, formulation, marketing, sales, finance and accounts well for the organization
future.
The work culture aims to mobilize, direct and sustain individual efforts and
encourage active participation of every member of the organization. Continuous
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efforts are being made to enrich human resource with the aid of orientation
programmes,
RESEARCH AND DEVELOPMENT
ITI has the most modern, well-equipped & technologically advanced R & D division.
The R & D is backed by a modern & systematic computer laboratory, automatic test
system laboratory, micro electronic & quality assurance laboratory. It is also using
SMD machine printed card assembly that has a capacity of 5000 components/hour.
The raw materials are accepted for production.
Management wants to charge prices that will least cover the total production costs at a
given level of production. Factors like overhead, material cost, laboratory costs,
excise duties etc. determine the price of a product. Manufacturing only after it is
found to he of the best grade by the in-house and independent laboratories. Finished
products are sent to the market only on approval of the a department.
HRD AND WELFARE ACTIVITIES
There is a well equipped training centre or the HRD centre where various kinds of
training takes place for the upliftment of trainees of professional courses by
experienced officials in the respective field. The apprentices of ITI are students from
Management, Engineering and also for Diploma courses. The training classes are
conducted throughout the year. Hence there is a special training centre to conduct and
coordinate this kind of training. ITI has implemented many welfare schemes for the
upliftment of the employees like medical facilities, canteen facility, transport facility,
safety and bonus etc.
PERSONNEL AND INDUSTRIAL RELATIONS
The companys faith in harmonious industrial
relations was characterized by readiness of the Union Officers Association
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Management to work in union for growth of the company. Employee morale and high
level of commitment was the key factor in achieving the highest level of performance.
A satisfied workforce is the greatest asset for any organization. The degree of
satisfaction could be judged by analyzing the industrial relations climate of the
company. Now for the last ten years there is only one trade union in the unit and the
election of office bearers is held every year by a secret ballot. This practice has lead
to a peaceful atmosphere in the organization.
WORKERS PARTICAPATION IN MANAGEMENT
The ITI unit has given full participation to the workers representatives to have equal
rights to raise their issues and grievances in the following areas :-
Sports Council
Welfare Committee
Provident fund Committee
Canteen Management Committee
Community for the award of the best work to the workman for outstanding
performance each year.
Death Relief Fund Committee
House allotment committee for workers.
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SWOT ANALYSIS OF ITI LTD. NAINI
STRENGTH WEAKNESS Company name Low non-DOT market share
Product quality High pricing.
Full government support Lack of proper marketing strategy, ineffective
& inefficient promotional strategy.
Oldest & well established
public sector company
Unable to maintain product quality
Huge capacity of
manufacturing
Overstaffing of employees
Efficient after sales
service
OPPORTUNITY THREATS
BSNL communication to
provide telephone
Poor service quality
Connection on demand Not able to meet deadlines
Skilled employees are
there
Not able to meet the demand.
New opportunities to enter
into cellular phone
services are there
Does not have good coordination with the
dealers and retailers
They can also enter into
electronic parts
manufacturing
Lack of teamwork spirit
Lack of proper customer surveys.
Entry of new competitors.
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CHAPTER:-2CONCEPTUAL DISCUSSION
MARKETING
Marketing boasts a rich array of concepts and tools
WHAT IS MARKETING?
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Marketing, more than any other business function, deals with customers
Understanding creating, communicating and delivering customer value and
satisfaction are at the heart of many modern marketing thinking and practice. We may
define MARKETING as. Marketing is the delivery of customer satisfaction at a
profit
Two fold goal of marketing is to attract new customers by promising superior value
and to keep current customers by delivering satisfaction.
What does the term Marketing mean? Many people think of marketing only as selling
and advertising. It is no wonder, every day we are bombarded with television
commercials, newspaper ads, direct mail campaigns, Internet pitches and sales calls. I
however selling and advertising is only the tip of the marketing iceberg. Although
they are important, they are only two of many marketing functions and are often not
the most important ones.
Today, marketing must be understood not in the old sense of making a sale telling
& selling but in the new sense satisfying customer needs selling occurs only after
the product is produced By contrast, marketing starts long before a company has a
product.
Social definition of Marketing:-
We define Marketing as a social and managerial process where by individuals and
groups obtain what they need and want through creating and exchanging products and
value with others.
Managerial Definition:-
Pater Drucker, an eminent management theorist puts it this way Marketing is the
process of planning and executing the conception, pricing, promotion and distribution
of ideas goods, services to create exchanges that satisfy individual and organizational
goals
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ITI NEED FOR THE MARKETING DEPARTMENT
Till 1993-94 ITI enjoyed being the only producer in this field of Telecommunication
in India. It had the power of monopoly, which was snatched away as the
Governments policy was introduced. Previously ITI was producing and the market
was buying it at the price at which it was being offered and desired by ITI. With the
entry of competitors. ITI felt the need for a Marketing department. Hence in 1994, in
the month of April the Marketing department was established. Its main challenge is to
bring back the lost glory of ITI.
For this they are supposed to keep up to date the changing answers of the following
five questions:-
What business we are in?
Who are our main customers?
What does your customer want and desires?
How can we best distribute our products to then?
How can we make communications with them more efficiently?
MISSIONS AND OBJECTIVES
The company entered the New Year with an objective of achieving new horizons in
the year 2000. It entered the order book position of Rs. 1000 and had set an internal
production target of Rs. 2000 crores for the millennium year 2000. The Company
rollouts business plans, which will have greater focus on the emerging technologies
as a result of convergence of communication and computing. The thrust of the
company will be on providing turnkey solutions for it and data communications. The
company has launched a new millennium with the following aim :-
To increase Productivity
To achieve Profitability
To accept Parivartan
A new operation called Operation Chetna has been introduced which aims at
increasing the following:-
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Profitability
Rejuvenation
RepositioningThus the missions and objectives may be stated as under :-
Creation of demand
Creation of product image and personality
Mass awareness about the product
Provision of efficient after sales service
Periodic arrangement of marketing research
Product modification and diversification as per customers specification
Increase in sales
Profits through customer satisfaction
Generate demand for telecom products through innovation
To become a strong service provider with major business thrust in telecom
network operations and value added services.
Strengthen the technology scanning capabilities to benchmark their products
/ services against global standards, identify new products, enable better maker
buyer decisions and identify potential partners.
Achieve global quality standards in all the products in the shortest time.
Introduce effective planning and control system for achieving delivery
schedules, streamlining production over the whole year and better inventory
control.
Create an environment that cares for the individuality and dignity of
employees.
Create a sense of achievement and involvement in the company.
Marketing Plan
The marketing plan operates at two levels. The strategic marketing plan lays out the
broad marketing objectives and strategy based on an analysis of the current market
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situation and opportunities. The tactical marketing plan outlines specific marketing
tactics including advertising, merchandising, pricing channels and service.
Market Oriented Marketing Strategy
Market oriented marketing strategy is the managerial process of developing and
maintaining a viable fit between the organization objectives, skills and resources and
its changing market opportunity. The aim of strategic planning is to shape the
companys business and product so that they yield target profits and growth.
It is the marketing strategy that decides the success at the business unit level which in
turn decides the total corporations success. The linkage between marketing strategy
and overall corporate success is indeed direct and vital. And in this linkage lies the
significance of marketing strategy.
To understand strategic planning, we need to reorganize that most large companies
consists of four organizational levels:-
Corporate level
Division level
Business unit level
Product level
Corporate headquarter is responsible for designing a corporate strategic plan to guide
the whole enterprise it makes decisions on which businesses to start or eliminate.
Each division establishes a plan covering allocation of funds to each business unit
within the division. Each business unit develops a business unit strategic plan to carry
that business unit into a profitable future. Finally, each product level (product level
line, brand) within a business unit develops a marketing plan for achieving its
objectives in its product market.
Motto of Mktg. Department
Making waves in communication
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Establishment of ITIs Marketing Department
The marketing system of ITI is in its infancy days. The requirement of this very
section was realized when many rival companies entered in the same business area
due to adopting liberalized economy by Govt. of India. There fore this department
came into existence in April 1994. The another reason to establish marketing division
is to get series of ISO certificates so that the product can be sold in global market.
MARKETING Inter relationship with other departments
PRODUCTION CONTROL (X)
To get delivery schedule of Standard / Existing products.
SYSTEM / CUSTOM ENGINEERING
For technical compliance, equipment configuration, technical
literatures, equipments, charts and related matters.
TECHNICAL COSTINGCost break up of existing products as well as newly developed products. In
addition it will also provide competent level costing for the purpose of spare
selling.
SALES (X)
For the feedback of dispatches and payments.
R & D
For technical clarifications related to customer made billed productsrequired by the customers.
FINANCE
For arranging bid security against BSNL / NON BSNL tenders.
MARKETING PROCEDURE OF ITI, NAINI
REVIEW OF TENDER STAGE
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The function of the marketing begins with the seeking for the tender & then receiving
the tender from the customers, which may be any of the following.
Bharat Sanchar Nigam Limited
Direct from Institutional Customers
Corporate marketing section
Regional offices
These above mentioned sources of enquires may be of two types.
Enquiry inviting tender bids
Urgent requirements of the customer.
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TENDER ENQUIRY
After the receipt of the tender enquiry the marketing department studies & if the
requirements is different, a preliminary meeting. For taking decisions & a final
decision is taken. Tender document is taken. Tender document is then sent to the
system engineering department.
Technical compliance statement, equipment configuration & technical questionnaire
are prepared by the system engineering department after getting the tender document
by the marketing department & is again sent back to the marketing department for
further action. The marketing department finalizes the point to point complianceof commercial terms. If any clarification is required, the same is obtained from the
customer. Delivery schedule is taken from divisional head / concerned shop in
charge / production control.
After receiving the configuration from the system engineering the bid rate is finalized
in consultation with the technical costing & management.
On receipt of all the above information the tender form is filled up & all the
relevant information is attached to it as cited in the bid form.
Finally the tender is submitted to the purchaser.
At the time of tender opening, generally one representative from marketing / regional
offices is present. Comparative bids statement is also prepared.
REVIEW ON RECIEPT OF ORDER
On receipt of Letter of Intent (LOI) or Advance Purchase Order (APO) copies are
sent to sales (X) and ink signed copy to DM (BR).
The marketing departments sends APO / LOI acceptance to customer after getting the
feed back information, delivery schedule, and price schedule & price schedule &
equipment details as acceptable to us.
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On receipt of the firm order, PO copies are sent to Sales (X) for dispatch advice &
also to the concerned sections & ink signed copies to DM (BR) Marketing department
also participates in the monthly review meeting for delivery schedule & customer
related problems coordinated by production control.
Present marketing strategy of ITI:-
The function of marketing department begins with seeking for the tender, then
receiving the tender from the customers come from:-
Bharat Sanchar Nigam Limited
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Direct from institutional customer
Corporate marketing section
Regional offices
After receiving the tender they rotate a circular to plan and produce their product
according to norms. If there is any doubt regarding the order, they contact marketing
department, otherwise get the technical compliance statement requirement and
technical leaflet.
After checking all the technical aspect by system engineering department delivery
schedule is made by production department so that the order can be completed withintimeframe. After this the material list is sent to technical department. Then it is
transferred to purchase department to purchase material.
After getting the order marketing department issue an order copy to the sales
department for the execution, get details of material supplied against respective order
from the sales department. By supply of furnished product to the related concern and
received by that firm within time work of marketing department use to complete.
Theoretical backdrop and literature review about the project is required
Product under study - Various transmission equipments
Product market - BSNL & NON BSNL (ONGC, VSNL, MTNL,
Railway, Defence, Electricity board, Private
offices, General public)
Earlier status of the organization - :
DOT (now BSNL) was the only to establish infrastructural facility of telecom in
the country
The telecom field was reserved only for the public sector
Being public sector ITI enjoyed full support of Govt.
It produces product as per demand of DOT.
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There was a positive co-ordination between DOT & ITI as a result it was the
Profitable public sector enterprise.
Present status of the organization -:
ITI is one the largest sufferers of the liberalization policy.
Apart from ITI, BSNL is purchasing products from other companies.
ITIs market share is decreasing due to reduction of orders.
ITI is suffering due to high labour / overhead cost.
OBSERVATION
By analyzing annual reports and other documents wee can observe that in this cut
throat competition ITI is continuously incurring loss due to its competitors. So to
move up ITI should redefine its marketing strategies against the present scenario of
liberalized economy to capture its old market share.
The major buyer of the telecommunication products is the Bharat Sanchar Nigam
Limited (BSNL)/ Department of Telecommunication (DOT). The BSNL has changed
purchase system with the changed policy of globalization. Earlier BSNL used to
purchase the products from ITI only, but now it is providing equal opportunities to all
the manufactures of telecommunication products. The BSNL has now adopted the
various marketing strategies like Tender Purchase System to have better quality
product at a lesser price. ITI has adopted various marketing practices like -:
Through open tenders
Through distribution channel
By direct enquiries from customers
Through BSNL circles.
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Strategies which ITI marketing department should adopt
Targeting Strategy
Decision about targeting centre on two major strategies-the concentration strategy and
the multisegment strategy. Whether a company chooses one or other, the decision
should be based on a clear understanding of company capabilities and resources the
nature of the competition and the characteristics of the product market.
Concentration Strategy
When an organization directs its marketing efforts towards a single market segment
by creating and maintaining are marketing mix it is employing a concentration
strategy. The main advantage of the concentration strategy is that the firm can analyze
the characteristics and needs of a distinct customer group and then focus all its energy
on satisfying that groups needs. A firm can generate a large sales volume by reaching
a single segment.
Concentrating on one segment also means that a company puts all its eggs in one
basket clearly a disadvantage. If a companys sales depend on a single segment and
the segments demand for the product declines, the companys financial strength
declines as well.
Multisegment Strategy
An organization directs its marketing efforts at two or more segments by developing amarketing mix for each selected segment. After a firm uses a concentration strategy
successfully in one market segment, it sometimes expands its efforts to additional
segment.
A business can usually increase its sales in the aggregate market through a multistage
segment strategy because the firms mixes are being aimed at more people the
company with excess production capacity may find a multisegment capacity
advantageous because the role of products to additional segments may absorb this
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excess capacity. On the other hand, a multisegment strategy often demands a greater
number of production processes, materials and people thus production costs may be
higher than with a concentration strategy. A multisegment strategy using firm
ordinarily experiences higher marketing costs. Because this strategy usually requires
more research and several different promotion plans and distribution methods, the
costs of planning, organizing, implementing and controlling marketing activities
increase.
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CHAPTER:-3
PRICING POLICIES
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INTRODUCTION TO PRICING
Pricing is perhaps the most important component in the marketing mix. while all
other elements in the marketing mix are cost factors, price is a revenue or income.
Pricing determines the viability of any business project because the demand and sales
revenue depend on the price. It is equally important for profit making and non-profit
making organizations. Fixing price is a problem for both.
WHAT IS A PRICE?
Price is commonly known as the exchange value of a product or service expressed in
terms of money. Price is paid for whatever services of products we receive, such as
rent for a house, fee of the Doctor, interest for the money etc. Whatever compensation
we pay for a particular product or service, we call the same as price in the strict sense
of the term. Price can be considered as the level between the buyer and the seller
regarding what catch item must get. Price is a device for translating into quantitative
terms the perceived value of a product / service to the customer.
Throughout most of history, prices were set by negotiation between buyers and
sellers. Fixed price policies - setting one price for all buyers is a relatively modern
idea that arose with the development of large scale retailing at the end of the
nineteenth century. Now some one hundred years later, the Internet promises to
reverse the fixed pricing trend and take us back to an era of dynamic pricing
charging different prices depending on individual customer and situations.
Price is the only element in the marketing mix that produces revenue. Price is also
one of the most flexible elements of the marketing mix. Price can be put in other
words as-:
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Total market offerings = Bundle of Expectations / satisfactions
= Price
IMPORTANT OF PRICING
Pricing constitutes one of the four factors of marketing mix is an indicator of its
importance in the marketing programme. Price is equally important to both the seller
and buyer. Price denotes the value of the product / service expressed in terms of
money. The exchange of goods and services for transfer of ownership is possible only
when the buyer and seller settle the price and buyer agrees to pay or pays for it.
The demand and supply theory in economics is purely based on price mechanism.
The supply and demand conditions in the market is influenced by price, or in other
words price will changed according to demand and supply position in the market.
Price is the regulator of profit, production and distribution. Price also regulates the
consumption of a product to a very great extent, because price is the main factor in
making buying decisions by buyers.
Pricing also influences the marketing objectives of the company. Many areas of
marketing are directly influenced by pricing, such as Sales volume, Profits, Trade
margin, Return on investment, Product image, Sales promotion strategies etc. pricing
is also used as a sharp weapon in the marketing strategy in the competitive market.
FACTORS AFFECTING PRICING
There are many factors, which would affect the pricing decisions. These can be
grouped into as internal or external factors. Most of the internal factors have a direct
relationship with the objective of pricing. For instance, the image of the company has
a direct effect on the pricing. The internal factors are the factors, which are from
within the organization & are controllable by the management. The external factors
are those concerned with customers, competitors in the market in particular. These
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factors especially competition, government policy and control etc. have to be taken
care of while formulating pricing strategies of the company.
INTERNAL FACTORS AFFECTING PRICING DECISIONS
MARKETING OBJECTIVES
Before setting price, the company must decide on its strategy for the product. If the
company has selected its target market and positioning carefully, then its marketing
mix strategy, including price will be fairly straight forward. Thus, pricing strategy is
largely determined by decisions on market positioning. At the same time, the
company may seek additional objectives. The clearer the firm is about its objectives,
the easier it is to set price. Examples of common objectives are survival, current profit
maximization, market share leadership and product quality leadership.
MARKETING MIX STRATEGY
Price is only one of marketing mix tools that a company uses to achieve its marketing
objectives. Price decisions must be coordinated with product design, distribution and
promotion decisions to form a consistent effective marketing program.
Companies often position their products
on price and then base other marketing mix decisions on the prices they want tocharge. Here price is a crucial product-positioning factor that defines the products
market, competition and design. Many firms support such price positioning strategies
with a technique called target costing, a potent strategic weapon. Target costing
reverses the usual process of first designing a new product, determining its cost, and
then asking. Can we sell it for that ? instead it starts with an ideal selling price
based on customer consideration, and target cost that will ensure that the price is met.
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Other companies de-emphasize price and use other marketing mix tools to create
nonprice positions. Often, the best strategy is not to charge the lowest price, but rather
to differentiate the marketing offer to make it worth a higher price.Thus the marketer
must consider the total marketing mix when setting prices.
COSTS
Costs set the floor for the price that the company can charge for its
products. The company wants to charge a price that both covers all its costs for
producing, distributing and selling the product and delivers a fair rate of return for its
effort and risk. A companys costs may be an important element in its pricing
strategy. Companies with lower costs can set lower prices that result in greater sales
and profits.
A companys costs take two forms, fixed and variable. Fixed costs (also known as
overheads) are costs that do not vary with production or sales level. Variable costs
vary directly with the level of production. Total costs are the sum of fixed and
variable costs for any given level of
EXTERNAL FACTORS AFFECTING PRICING DECISIONS
THE MARKET AND DEMAND
Whereas costs set the lower limit of prices, the market and demand set the upper
limit. Both customer and industrial buyers balance the price of a product or serviceagainst the benefits of owing it. Thus before setting prices, the marketer must
understand the relationship between price and demand for its product.
COMPETITORS COSTS, PRICES AND OFFERS
Another external factor affecting the companys pricing decisions is competitors costs
and prices and possible competitor reactions to the companies own pricing moves.
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OTHER EXTERNAL FACTORS
When setting prices, the company must also consider other factors in its external
environment. Economic conditions can have a strong impact on the firms pricingstrategies. Economic factors such as boom or recession, inflation and interest rates
affect pricing decisions because they affect both the costs of producing a product and
consumer perceptions of the products price and value. The company must also
consider what impact its prices will have on other parties in its environment. How
will resellers react to various prices? The company should set prices that give
resellers a fair profit, encourage their support and help them to sell the product
effectively.
PRICING POLICIES
The management may decide on the policies to be formulated for pricing its products.
Pricing can be based on the need of the consumers, or on the cost of production and
marketing or on the market conditions.
Need-based pricing is adopted by the government for public services like health,
education etc. cost based pricing or mark up pricing is followed by many companies,
such as supply of items on a periodic/ contract basis and products which less
competitors etc. the market based pricing is necessary for consumer goods.
Depending upon the products and their position in the market, the management has to
decide the policies to be followed in pricing. The management has to decide the
policies to be followed in pricing. The management has several pricing options in
deciding the prices. Some companies may decide to follow one price policy or
variable price policy or to act as leader in the market as regard as price is concerned.
The one price policy is found to be quite sound and reasonable. The company follows
a fair and fixed policy in line with the normal price market price, which ensures
reasonable profit. Under the variable price policy the buyers/ customers are
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discriminated and bulk buyers and valuable customers are offered favorable terms
while others are not given the same
PRICING APPROACHES
COST BASED PRICING
The simplest pricing method is cost-plus pricing: adding a standard markup to the
cost of the product. To illustrate markup pricing we may consider the following
example -:
Variable cost = $10Fixed cost = $ 3, 00,000
Expected unit sales = 50,000
Now, cost/ unit is given by -:
Unit cost = Variable cost + Fixed cost/ Unit sales
= $ 10 + $ 3, 00, 000/ 50,000
=$ 16
Now, suppose the estimated markup is 20% on sales, then the markup price is given
by -:
Markup price = Unit cost / (1- Desired Return on Sales)
= $ 16/ (1=0.2)
= $ 20
Thus the charged price would be $20 and the profit would be $4 per unit.
VALUE BASED PRICING
An increasing number of companies are basing their prices on the products perceived
value. Value- Based pricing uses buyers perceptions of value. Value Based pricing
means that the marketer cannot design a product and marketing program and then set
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the price. Price is considered along with the other marketing mix variables before the
marketing program is set.
COMPETITION BASED PRICING
Consumers will base their judgments of a products value on the prices that
competitors charge for similar products. One form of competition- based pricing is
going rate pricing, in which a firm bases its price largely on competitors prices,
with less attention paid to its own costs or to demand. The firm might charge the
same, more or less then its major competitors. Competition-based pricing is also used
when firm bid for jobs. Using seated bid pricing, a firm bases its price on how it
thinks competitors will price rather than on its own costs or on the demand. The firm
wants to win a contract, and winning a contract requires pricing less than other firms.
Yet a firm cannot set its price below a certain level. It cannot price below cost without
harming its position. In contrast, the higher the company sets its price above its costs,
the lower its chance of getting the contract.
PRICING STRATEGIES
Pricing policies are general guidelines for recurrent and routine issues in marketing.
Strategy is a plan of action to adjust with changing conditions of the market place.
New and unanticipated developments may occur. These situations demand special
attention and relevant adjustments in the pricing policies change from time to time.
The types of strategies that a company may adopt may of the following types.
MARKET SKIMMING PRICING
Many companies that invent new products initially
set high prices to skim revenues layer by layer from the market. Market skimming
makes sense only under certain conditions. First the products quality and image must
support its higher price and enough buyers must want the product at that price.
Second, the costs of producing a smaller volume cannot be so high that they cancel
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the advantage of charging more. Finally, competitors should not be able to enter the
market easily and undercut the high price.
MARKET PENETRATION PRICING
Rather than setting a high initial price to skim off
small but profitable market segments, some companies use market penetration
pricing. They set a low initial price in order to penetrate the market quickly and
deeply, to attract a large numbers of buyers quickly and win a large market share.
PRODUCT LINE PRICING
This means setting the price steps between various products in a product line based
upon cost differences between the products, customer evaluations of different features
and competitors prices.
PRICE ADJUSTMENT STRATEGIES
The two popular types of price discounts are -: Cash discount
A cash discount is a quantity reduction to buyers who pay their bills promptly. Such
discounts are customary in many industries and help to improve the sellers cash
situation and reduce bad debts and credit-collection costs.
Quantity discounts
A quantity discount is a price reduction to the buyers who buy large volumes. By law,
quantity discounts must be offered equally to all customers and must not exceed the
sellers cost savings associated with selling large quantities. These savings include
lower selling, inventory and transportation expenses.
PRICING STRUCTURE OF ITI
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During 1996-97, ministry of communication decided that ITI would get 30% as a
reserved quota of any tender with L.I. price of the tender For the rest 70%, if ITI
companies then ITI will also get orders from BSNL. As per the planning of
communication ministry, ITI gets at least 1800 crores (as reserved quota) plus share
received through tender (i.e. 70%), But the problem with I.T.I. is that it will supply all
the orders in L1 rate of tender of each item. That is why I.T.Is profit margin is very
low and at the same time it is on the no profit, no loss basis. As I.T.I. is getting an
advance of 75% against reserve quota of 30% so I.T.I. is not facing any financial
problem for the procurement of material at least. Factors like overhead, material cost,
laboratory costs, excise duties etc. determine the price of the product.
TECHNICAL COSTING OF THE TRANSMISSION
EQUIPMENTS
Product costing is done with the help of the database computer system. Whenever a
new product is introduced Technical Costing Section demands Bill of Material from
the computer center for all assemblies and sub-assemblies in order to list out variousassembly and mechanical components involved in that particular product. The EDP
department generates Bill of Material after receiving input data form System
Engineering, which consists of parent codes and route codes.
After ascertaining that the complete Bill of Material is available with EDP, Technical
costing asks the EDP to link the inventory rates with latest Inventory Rate Master,
which is being updated with the latest, weighted average Rates (WAR). Whenever no
purchases are made during the year, last years rates are taken. Even there are items for
which rates may not be available, under such situation EDP gives a Master list of Not
in to mechanical costing. This situation occurs due to the reason of either a substitute
material being used or the purchase order rate is not appearing for new items from
purchase department. After applying the normal levies, as the case may be in the
purchase order, we calculate the price of the material & feed in the Not in Master.
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After feeding the rates from penned figure in the Not in the Master EDP complete
Bill of Material & linking with the inventory, rates are given to Technical Costing for
checking any discrepancies in the rates. Unit measures particularly the copper wires
& others are given in Kg & the unit measure with the Bill of Material in given in GM.
Extra care is being taken by technical costing in this regard.
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For mechanical components, the methods department is supplying the process sheets/
layouts. The raw materials used, size, specification, & weight of raw material to make
1000 components as given in the process sheet/ layout. We calculate the cost of
mechanical components in following format.
The material cost of the material component is fed in the not in the master
along with the P.O. rates. After feeding all the inventory rates, P.O. rates for new
items & material cost of mechanical component, EDP supplies us with the three
statements of cost:
Assembly & sub-assembly wise cost sheet.
Value added cost sheet.
Final cost sheet.
Assembly and sub-assembly wise cost statement for individual assembly item is
given which includes cost of all inventory items and mechanical component in that
particular assembly or sub-assembly Value added statement consists of various
subsequent assemblies are added in the main assembly cost. Final cost statement
consists of the cost of complete assembly and sub-assembly cost and added value is
given.
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Component code
R.M. & specification
Size of R.M.
Quantity WT. /1000
WAR Rate
Material cost
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For labor cost calculation the time standards of various assembly, sub-assembly,
mechanical components and main assembly of the product is sought. Normally the
standards hours are for 1000 numbers. The standard hours are fed in the Bill of
Material along with the time standard. The shop Average Rates are calculated once in
year taking into account the pay details of all operative against whom DPRs are
booked which is supplied by the EDP department.
Since EDP only calculates one-year material cost and the labor and overhead costs are
calculated by feeling the information in the PC, overhead percent is applied based on
the 1986 approved by DOT and BICP.
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CHAPTER:-4
RESEARCH METHODOLOGY
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INTRODUCTION OF RESEARCH METHODOLY
In addition to information about competitors and environment happenings, marketers
often need formal studies of specific situations. In such situations, the marketing
intelligence system will not provide the detailed information needed Managers will
need marketing research.
We can define research methodoly as the systematic design, collection, analysis and
reporting of data relevant to a specific marketing situation facing an organization.
Every marketer needs research. A company can conduct marketing research in itsown research department or have some or all of it done outside, depending on its own
research skills and resources.
The marketing process research has four steps:-
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Defining the problem and
research objectives
Developing the research plan or
review the literature
Collection of data
Analysis of data
Research Design (including
sample design)
Interpreting and adapting the
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STEP:1
DEFINING THE PROBLEM AND RESEARCH OBJECTIVE
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DEFINING THE PROBLEM AND RESEARCH OBJECTIVE
The marketing manage and the researcher must work together to define the problemcarefully, and they must agree on the research objectives. Defining the problem and
research objectives is often hardest step in the research process. After the problem has
been defined carefully, one of the following objectives must be set :-
Exploratory research
Descriptive research
Casual research
PROBLEM
ITI being in this business for so long understands the ups and downs of this business
very well. Hence when the problem aroused due to liberalization and also due to
entrance of competition and ITI started loosing its market share and incurring losses,
it changed its pricing strategy and new policies were introduced. But still it continuedto be in losses even though its profits were increasing. Hence, it was necessary to find
out what the actual reason was for losses that were being incurred. For this reason we
carried on with this research to find:-
Whether the people were satisfied with the product or not and with the after
sales service?
Whether the price was competitive or not? Whether there was a demand in the market?
Why there was a lost being incurred every year even when the company sales
were increasing?
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APPARENT PROBLEM
The apparent problem for losses being incurred was that prices were not competitiveenough hence the company was going into losses. Even when the pricing strategy has
been changed it was not right for quoting tenders. It was also necessary to find
whether there was acceptance for the product in the market. It was also necessary to
find whether repeat purchase was there or not Customer might be buying it due to
companys goodwill but after one purchase was there a repeat purchase or not ? It
was also necessary to find out the competitors strength and how it was affecting the
sales of I.T.I.
OBJECTIVE
The research objective was to find a solution for the above problem. I.T.I. being a
pioneer in the telecom business and being the boss would like to hold the same
position. It therefore wanted to get an in depth view of the above stated problem.
Hence the objectives were:-
To get knowledge about the present marketing & pricing structure of ITI.
To bring about the marketing positioning of the ITI products with regards to
the marketing & pricing factors.
To bring forth the degree of brand awareness amongst the customers.
To get acquired with the relatively preferred brand & the reason behind their
success of being preferred.
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STEP:2
REVIEW THE LETRATURE
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DEVELOPING THE RESEARCH PLAN
The second step of marketing step of the marketing research process calls for
determining the information needed, developing the plan for gathering it efficiency,
and presenting the plan to marketing management. The plan outlines sources of
existing data and spells out the specific research approaches, sampling plans and
instruments that researchers will use to gather new data. The information required in
detail regarding the project was collected and and analyzed, but the step taken before
collecting this information was to decide actually what information was required. Ilance am proper analysis was made to decide what information was needed. The
information required was as follows:-
Pricing Strategy
What is the current pricing strategy?
Was there any other pricing strategy earlier?
When was it changed?
Is there any problem with the current pricing strategy?
Was this pricing strategy adopted?
Has this pricing strategy been effective?
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STEP: 3
RESEARCH DESIGN (INCLUDING SAMPLE DESIGN)
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RESEARCH DESIGN
Research design is a preplanning of research in which
manner the research should be conducted it is a type of blue-print as in the case of
building construction or we say it is a frame according of which we for research.
Research plan or Design is formulated keeping in view the problem which is
to be analyzed.
A Research Design may be explanatory, descriptive or an experiential in
nature. As per convenience i have adopted descriptive method of Research
Design.
Problem Definition
Downfall in demand of ITIs telephones in the market
Deterioration in market share of ITI
Expansion of competitors network
Project under study
Telephone instruments
Exchange equipments
Market segment under study
BSNL
NON-BSNL
SAMPLING PLANA sample is a segment of population selected to population as a whole. Ideally the
sample should be representative so that the researcher can make accurate estimates of
the thoughts and behaviors of the larger population. Designing the sample requires
three decisions. First, who is to be surveyed? Second, how many people should be
surveyed? Third, how should people in the sample should be chosen?
Regarding my research process the sample selected includes the telephone exchanges,
BSNL and railways of Allahabad.
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Sample technique
Area sampling
Area sampling is one in which research involves populations that can be grouped byidentifiable geographic areas like blocks, housing tracts, communities. Then it is
possible to use a version of cluster sampling known as area sampling.
Since the sample in my research was limited and small, I divided the samples into
areas of Allahabad.
Sample size and population size : The sample size selected by me was 55.
REASONS FOR SELECTING THIS SAMPLING TECHNIQUE
AND SAMPLE SIZE
The reasons for selecting the sample size are -:
The customers profile of ITI is small, as there are bulk purchasers of ITI
transmission equipment. They place big orders through tenders.
The sample was large enough to represent the whole population.
The sample was large enough to derive the information needed to reach to a
particular conclusion.
The reasons for selecting the following sample techniques are
The area has sufficient samples to obtain information.
The area contains the most important customers of ITI.
The area was easy to cover.
The area contained customers who could give the right information, as they
had been associated with ITI for a long time.
The area has samples that could give unbiased view.
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STEP:4
COLLECTION OF DATA OR SOURCES OF INFORMATION
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COLLECTION OF DATA OR SOURCES OF INFORMATION
After deciding what information is required the
next step is to decide which the various sources of obtaining are. There are various
sources from where this information could be collected or gathered. Choosing the
right source for collecting data is of prime importance.
PLANNING PRIMARY DATA COLLECTION
In case of collecting the primary data use of questionnaire was thought to be effective
and hence the first step was to design a questionnaire. The questionnaire contains all
the relevant questions covering the information needed. The questionnaires were
given to the respondents to get filled. Personal interviews were conducted and
personal observation was made to see the buying habits of the customers. Designing a
plan for primary data for primary collection calls for a number of decisions on
research approaches, contact methods, sampling plan and research instruments.
RESEARCH APPROACHES
Observational Research is gathering of primary data by observing people, actions and
situations. Consumer packaged-goods marketers might visit supermarkets and
observe shoppers as they browse the store, pick up products and examine packages
and make actual buying decisions. Some marketing research firms now offer single-
source data systems that electronically monitor both consumers purchases and
consumers exposure to various marketing activities in an effort to better evaluate the
link between the two.
Survey research is the approach best suited for gathering the
descriptive information. To get knowledge about the peoples attitudes, preferences or
buying behavior can be found out easily by asking individually directly. Survey
research is most widely used method for primary data collection and is often the only
method used in a research study. The main advantage of the survey research is its
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flexibility. It can be used to obtain different kinds of information in many different
situations. Depending on the survey design, it may also provide information more
quickly at lower costs than observational or experimental research
CONTACT METHODS
Information can be collected by mail, telephone,
personal interview or online. Mail questionnaires can be used to collect large amounts
of information at a low cost per respondent. Respondents may give honest answers to
more personal questions on a mail questionnaire than to an unknown interviewer, in
person or over the phone. However, mail questionnaires are not flexible. They usually
take longer to complete and the response rate is often low.
Telephone interviewing is one of the
best methods for gathering information quickly and it provides greater flexibility than
mail questionnaires. However, with telephone interviewing the cost per respondent is
very high. Also, people may not want to discuss personal questions with an
interviewer.
Personal interviewing takes two forms: individual and group
interviewing. Individual interviewing involves talking with people in their homes or
offices, on the street or in shopping malls. Group interviewing involves talking with
people for a few hours with a trained moderator to talk about a product, service or
organization.
RESEARCH INSTRUMENTS
In collecting primary data, marketing researchers have a choice of two research
instruments the questionnaires and the mechanical devices. The questionnaire is by
far the most common instrument, whether administered in person by phone or online.
Questionnaires are very flexible. The form of each question can influence the
response.
In my research process I made use of the questionnaires. The questions
chosen were simple and to the point covering the relevant points and also keeping in
mind the purpose of the project. It covers all the aspects of the project and contains
questions about customer expectations, the product features, competitors knowledge
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and the views of the customers regarding what they are looking for in the equipment
in the long run.
REASONS FOR CHOOSING THE QUESTIONNARES AS THE
RESEARCH INSTRUMENT
It gives respondent a clear comprehension of the questions.
It includes the respondent to want to cooperate and trust that the answers will
be kept confidential.
Stimulates responses through greater introspection, plumbing of memory orreference to records.
It gives instructions on what is wanted and the manner of responding.
GATHERING SECONDARY INFORMATION
Secondary data consists of information that already exists somewhere, having been
collected for another purpose. Researches usually start by gathering secondary data.
the Companys internal database provides a good starting point. The significance of
the secondary data can hardly be understood.
In my research process the secondary data played a major role as the customer are
less but place orders through tenders which are in bulk. I used sources like Company
Profile and Annual Report of ITI.
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OVERVIEW OF RESEARCH PROCESS:-
Research type :- Descriptive research
Research Design :- Descriptive research design
Sample size :- 55
Population size :- 2000Primary data :- Questionnaire and Unstructured
Interview with Employees and
staff
Secondary Data :- Annual report and company profile
Analysis style :- Graphs
Reporting style :- Interpretation, finings, suggestion,limitation of project , conclusion.
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STEP: 5
DATA ANALYSIS
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Ques:1:-What was the Awareness of the transmission
equipment manufacturers in their customermind
CHART:1
Awareness of Equipments
0
5
10
15
20
25
30
35
ITI BEL MAC FIBCOM HFCL OTHERS
No .of responses
% of responses
COMPANY NAMES
68
COMPANY NUMBER OF RESPONSES % OF RESPONSES
ITI 17 30.9%
BEL 11 20%
MAC 10 18.1%FIBCOM 8 14.5%
HFCL 5 9.09%
OTHERS 4 7.2%
No
of
resp-
onses
& its%
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Ques:2 Which equipments required most by the customers ?
EQUIPMENTS NUMBER OF RESPONSES % OF RESPONSES
RADIO EQUIPMENT 15 27.2%
OPTICAL FIBERS 12 21.8%
DIGITAL MUX EQUIPMENT 8 14.5%
OPEN WIRE SYSTEM 10 18.1%
MULTIPLEXING
EQUIPMENT FDM
6 10.9%
NO RESPONSE 4 7.2%
CHART :2
Demand of Equipments
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Company names
No
Ofrespo-
nses
&
Its %
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COMPANY EQUIPMENTS
Ques:-3 What was the reasons for not buying ITIs
equipment?
ATTRIBUTES NUMBER OF RESPONSES %OF RESPONSES
DELAY IN FULFILLING ORDERS 35 63.6
COMPARATIVELY MORE DEFECTS 14 25.4
LACK OF PROMOTIONAL
DISCOUNTS
6 10.9
CHART:3
REASON FOR NOT BUYING EQUIPMENT
0
10
20
30
40
50
60
70
Delay in fullfillinf orders Comparatively more
defects
Lack of Promotional
discounts
No of responses
% of its responses
ATTRIBUTES OF PRODUCT
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No of
respo-
nses
& its
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Ques :4 Which features/ attributes desired in the
transmission equipment?
CHART:-4
FEATURES DESIRED IN TRANSMISSION EQUIPMENTS
ATTRIBUTES OF PRODUCT
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ATTRIBUTES NUMBER OF RESPONSES % OF RESPONSES
LOWER PRICES 13 23.6%
AFTER SALES SERVICE 11 20%
MAINTENANCE COST 10 18.1%
QUALITY 7 12.7%
COMPANYS REPUTATION 6 10.9%
OVERALL PRODUCT 4 7.2%
OTHER (GUARANTEE PERIOD) 4 7.2%
No
of
resp
onses
& its%
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Ques: 5. Rating the companies with the equipment being
manufactured by them according to satisfaction of the
attributes / features found in them ?
(i) 2/34 OPTIMUX
ATTRIBUTES MAC
RESPONSES
% HFCL
RESPONSES
% ITI
RESPONSES
%
EASE OF USE 10 18.1
%
15 27.2
%
16 29.09%
EASY
DETACHABILITY
8 14.5
%
10 18.1
%
11 20%
LONG PHYSICAL
LIFE
7 12.7
%
8 14.5
%
5 9.09%
COMPARATIVELY
MORE DEFECTS
6 10.9
%
6 10.9
%
10 18.1%
AFTER SALES
SERVICE
5 9.09
%
0 0% 5 9.09%
MAINTENANCE COST 7 12.7
%
6 10.9
%
0 0%
COMPANYs
REPUTATION
6 10.9
%
7 12.7
%
11 20%
PRICE ECONOMY 4 7.2% 3 5.4% 6 10.90%
CHART: 5(A)
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RATING THE COMPANIES
WITH EQUIPMENT FEATURES
ATTRIBUTES OF PRODUCT(A)
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No
of
res
po
nse
s &
its%
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(ii) STM 1
ATTRIBUTES FIBCOM RESPONSE % ITI RESPONSE %
EASE OF USE 15 27.2% 13 23.63%
EASY DETACHABILITY 9 16.3% 11 20%
LONG PHYSICAL LIFE 5 9.09% 4 7.27%
COMPARATIVELY MORE
DEFECTS
4 7.27% 8 14.5%
AFTER SALES SERVICE 5 9.09% 6 10.9%
MAINTENENCE COST 4 7.27% 4 7.27%
COMPANYs REPUTATION 6 10.9% 5 9.09%
PRICE ECONOMY 7 12.7% 4 7.27%
CHART:5(B)
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RATING THE COMPANIES
WITH EQUIPMENT FEATURES
ATTRIBUTES OF EQUIPMENTS
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No of
resp
onses
& its
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STEP : 6
INTERPRETATION AND FINDING
INTERPRETATION AND FINDING
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The next step after arranging the data is to interpret the findings and arrange them
according to priority. The market survey has been done, and now it is necessary to
interpret the findings so to impart a much better understanding
Interpretation is an
important phase of the marketing process. Form the interpretation of the findings of
my research it can be easily said the pricing policy is not a problem for ITI.
THE FINDINGS ARE AS FOLLOWS -:
ITI products are preferred due to lower prices.
After sales service is excellent.
Maintenance cost is also very low as compared to its competitors.
Latest technology proves to be a boon for the company.
Sales are lost due to its inability to supply the products on time.
Competition has also come up with latest technology.
Products of ITI are easy to handle and are easily detachable.
The research was to find out why loss was being incurred, when the sales were rising.
In my research I found that the equipment being manufactured by I.T.I. satisfied
people and its quality is good. So why there was a loss?
The interpretation is as follows:-
The awareness of the I.T.I. equipments was 30.9% as compared to BEL (20%), HFCL
(9.09%), MAC (18.1%), FIBCOM (14.5%) and others (7.2%). The equipment of
I.T.I. in demand required mostly by the customers are 27.2% radio equipments,
21.8% optical fibers, 14.5% digital MUX equipments, 18.1% open wire equipments
and 10.9% Multiplexing equipment FDM.
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Those who did not choose I.T.I. equipments were 63.6% due to delay in supplying
orders on time, 25.4% due to having comparatively more defects and 10.9 due to lack
of promotional benefit
The features/ attributes that the customers are looking for in the equipment are :-
20% said low price
9.09% good sales service
18.1% low maintenance cost.
29.02% good quality of product.
11.8% for technical collaborations
20% for company reputation.
5.9% said overall product should be good.
The price economy is 7.2% for MAC, 5.4% for HFCL and 10.9% for I.T.I.
In case of STM-1 it gets tough competition from FIBCOM. For item 2/140 Mb .
LIMITATIONS
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Though utmost care was taken so that aspects of the problem remained untouched but
still there were certain constraints that could not be overlooked.
The following were the main constraints in my project.
1:-The paucity of time restricted the field of survey.
2:-The topic of the project was very delicate hence people were afraid to give their
views openly.
3:-The secondary data was not very auto date.
4:-The sample unit was not very sufficient.
5:-Some of the respondents were not available.
6:-Personals biases and perceptions of the respondent may have stopped him from
giving the right information.
7:- The respondent may not have understood the actual implication of the question.
RECOMMENDATIONS
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Strategy of marketing mix modification
1. PRODUCT -:
New products those are in demands in the market should be identified.
Durability of the product should be enhanced. Some of the existing products
should be innovated.
2. PRICE -:
ITI should try to reduce the prices of its products for attracting new
customers and to win over competitors customer. This can be done by reducing
the manufacturing costs and the overhead expenses. Also, the company can
encourage discount and credit facility.
3. PROMOTION -:
Perhaps, it may be the key of ITIs survival in the present market. ITI
should encourage and adopt new sales promotion schemes. These schemes can be
fruitful in enhancing the sales volume, trade rebate, discounts guarantee etc. are
tools of promotion.
4. PUBLICITY -:
It holds the key factor for the success of any business in the present
scenario of competition. ITI can review its old glory by adopting appropriate
advertisement and publicity channel.
ITI should adopt consumer oriented marketing schemes. ITI should try to establish
direct contacts with the people to generate awareness of products to know their
requirement.
Strategies for other modification -:
1. Research and development should be encouraged.
2. Warrant should be replaced by replacement guarantee.
3. Marketing professionals should be recruited so that high-tech marketing
environment is generated due to widening of marketing concepts and technical
ideas.
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4. More professional approach need to be adopted in dealing with the
competitors.
Others -:
1. There should be proper motivation to employees for better performance.
2. The induction of proper training to employees for effective operation.
3. The company should establish a well-organized marketing information system
to have a view of customers opinion.
4. Establishment of marketing research team.
5. Essential measures should be taken up to cut down the expenditure.
6. Management should pay more attention for the upgradation of technology to
meet the global standard.
CONCLUSION
1. ITI has a clear monopoly in terms of telephone equipment supply to BSNL
and has majority in case of equipments supplied to BSNL.
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2. For instruments supplied to BSNL, ITIs share is 30%.
3. ITI highly depends on BSNL for orders they do not pay attention towards
advertising and publicity.
4. Approximately 70% of its ultimate consumers are satisfied from ITIs
equipment.
5. High overhead expenses have resulted in high price of ITIs products.
6. ITIs competitors have switched to replacement guarantee.
During my research, I came to know that the management of ITI has changed its
strategy recently and has set some new objectives which are as -:
1. Generation of demand through innovation.
2. Supply of finished product within stipulated time.
3. Go through mini tie-up with MNCs or technically advanced companies for
new range of products.
4. Strengthening technology scanning capability to benchmark the product
against global standards.
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CHAPTER: 5APPENDIX
QUESTIONNAIRE
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I say thanks for agreeing to spare 5 minutes of your time for filling up this
questionnaire.
NAME:-
NAME OF THE ORGANIZATION: - ......................................................
ADDRESS: - ......................................................
PHONE NO. :- ......................................................
1. What is the main business activity that takes place in this establishment?
2. Could you please tell which company comes first to your mind when we ask
about Transmission Equipment Manufacturers?
3. Could you please name two or more companies?
4. Have you ever used products being manufactured by ITI? (YES/NO)
5. If YES then what are the products what are the products of ITI which are
being used by you?
6. What are the reasons for choosing this equipment?
7. If NO, what are the probable reasons for not buying ITIs equipment?
8. While buying the Transmission equipment did you consider any other
equipment of any other company?
9. Do you really think that there is a difference between quality and technology
provided by ITI and that of other companies?
10. Do the ITI products need frequent after sales service?
11. Do you get the delivery of products on time?
12. What features / attributes are you looking for in the transmission equipment
when you purchased it? (Rate 1 to 8)
Price
Overall product
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Quality
Company reputation
Guarantee period
After sales service
Maintenance cost
Tie up
BIBLIOGRAPHY
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Kotler Philip, Marketing Management, Analysis, Planning, Implementation
and Control, tenth edition, 2000 Prentice Hall India.
Dilele, Simken, Pride, Ferrel Concepts and strategies, second European
edition.
ITI unaudited annual report.
Institution reference books.
ITI website.
www.itiltd.org