Case Study Methodology

What is a Case Study?

• • ‘A case study presents an account of what

happened to a business or industry over a
number of years.
• It chronicles the events that managers had to
deal with :
changes in the competitive environment,
charts the managers’ response,
which usually involved changing the business-
or corporate-level strategy’
 What is Case Study Method?

• Robert K. Yin defines the case study research

method as:

• ‘… an empirical inquiry that investigates a

contemporary phenomenon within its real-
life context; when the boundaries between
phenomenon and context are not clearly
evident; and in which multiple sources of
evidence are used’
 Features of Case Study Method

• Uses multiple sources of evidence

• “Real life” context
• Empirical
• Progress of a company or industry
• Focus on competitive environment and
strategic/operational changes
 ADVANTAGES

• Use small data sets (such as one or two

companies)
• Generalizes about trends in relevant
industries
• “Real life” in the sense that a company or
companies have been chosen as the source
of the data
• Only method possible in some areas of
inquiry
• It involves detailed, holistic investigation (for
example, all aspects of a particular company)

• Data is contextual (relative to a certain industry)

• A range of different measurement techniques can

be applied

• The histories and stories that can be told about the

company can be illuminating
 DISADVANTAGES

• Does not ensure reliability or generality of

findings.
• Intense exposure to study of the case biases
the findings.
• Useful only as an exploratory (not
explanatory) tool.
• Contextual nature of evidence is limiting
 How to Solve Case Study

• Study

• Contemplate

• Decide

• Implement
 Case Study Analysis

• Analyse the problem with the company

or industry

• Write a report based on findings

• No “right way”
Structure of Case Analysis
Problem Statement

Issue Analysis

Presentation & Discussion Of Alternatives

Plan Of Action

Summary
 Problem Identification and Analysis

• In this section you should identify all the major

problems in the case in behavioral terms

• Most of the cases contain a strategic problem

• Some cases – Tactical perspective

• Apparent tactical problem disguises

fundamental strategic problem
• Try to get to underlying causes of problems, not
just symptoms

• • You should link each problem identified to

relevant theory and also to actual evidence from the
case

• • Remember you must integrate theory and

reference
Statement of Major Problems / Issue Analysis
• You will identify a number of problems—too many
students attempt to actually ‘solve’ the problems

• It is crucial to make it very clear which are the major two

or three problems or key issues, that must be solved first

• This section should consist of a short concise statement of

the problems you are going to solve in the remainder of the
case

• Check back to ensure that you are actually attempting to

solve them, rather than focusing on other minor problems
that you may have identified

• This section is crucial to a good case report

 An Issue Analysis might contain

• Facts : Especially numerical information

• Opinions : of the current management,

key personnel & of yours

• Assumptions : should be clearly stated

since solutions depend on them
 Generation of Solutions

• Identify and evaluate a number of the more

appropriate solutions (at least two to three for each
major problem identified)

• Each alternative solution should be briefly outlined

and then evaluated in terms of its advantages and
disadvantages

• It is not necessary to make a statement in this section as

to which alternative is considered best— this is stated
in the next section.

• Do not integrate or recommend theory in this section.

Practical solutions to the problems are required.
• Advantages Disadvantages
• Alternative 1

• Alternative 2

• Alternative 3
 Recommendations

• State which of the alternative solutions (either

singly or in combination) identified in previous
section are recommended

• Justify your choice, explaining how it will solve

the major problems identified.

• Integration of relevant theory

• Recommend precise courses of action that the

company needs to take.
Findings Conclusions Recommendations

• Findings are factual and verifiable

statements of what happened or what
was found

• Conclusions are your own ideas that you

deduce from your findings

• Recommendations are what you want

done
 Implementation – POA

• Write your recommendations in the form of an action plan.

• Explain how you will implement the recommended

solutions.
• – What should be done,
• – by Whom
• – When
• – in What sequence,
• – What will it cost (rough estimates) and other such issues

• Remember, if a recommended solution cannot be

realistically implemented, then it is no solution at all.
• Recognise that there is rarely one single case solution.

• Recognise that there may be two or more alternatives

which if properly implemented will solve the problem

• Have a contingency plan

• Your POA should support / defend the chosen alternatives

• Most good POA’s will have business / market / product

focus
 What to do …
• Read the case thoroughly.

• First time to get an overview of the industry, the company, the people, and
the situation. Helps form an Idea about the basic problem.

• Read the case again more slowly, making notes as you go.

• Define the central issue. Many cases will involve several issues or
problems.

• Identify the statements which help define the problem and

separate them from the more trivial issues

• After identifying what appears to be a major underlying issue,

examine related problems
Reinforce…..

Will not have adequate information.

Identify information gap & make realistic

assumptions
 Define the firm's goals (only if applicable).
• – Inconsistencies between a firm's goals and its performance may further
highlight the problems discovered

• – Identifying the firm's goals will provide a guide for the remaining
analysis.

• Identify the constraints to the problem (only if applicable).

• – The constraints may limit the solutions available to the firm.

• – Typical constraints include limited finances, lack of additional production

capacity, personnel limitations, strong competitors, relationships with
suppliers and customers, and so on.

• – Constraints have to be considered when suggesting a solution.

 Identify all the relevant alternatives

• – The list should include all the relevant alternatives that could
solve the problem(s) that were identified.

• – Use your creativity in coming up with alternative solutions.

• – Even when solutions are suggested in the case, you may be able
to suggest better solutions.

• - Select the best alternative.

– Evaluate each alternative in light of the
available information. – Resist the
temptation to jump to this step early in the case analysis
•
• – You will also need to explain the logic you used to choose one
alternative and reject the others.
 Develop an implementation plan

• • Plan for effective implementation of your

decision.

• • Don't overlook this step. It is important as

a future manager to be able to explain how
to implement the decision.
 Analysis of Case

• Identification of “problem(s)”

• Use of theory to evaluate and recommend

actions
 Things you can cover (1)

• Human resources/people management issues

• - E.g : New manager finds people unresponsive to
his/her new changes.

• Why? Background to problem? How can they

overcome resistance?

• Cultural or ethical problems

• Leadership issue

• Change scenario
 Things you can cover … (2)

• Analyse the company's history, development, and growth.

• What circumstances led to the company being established?
• What products did it make initially and what does it make
now?
• How does the company make new product decisions?
• How has the company evolved over time?
• How has it chosen its marketing strategies, etc?
• How did the company take steps to enter new markets?
• How and why did the company choose to merge or
takeover another company?
• What were the main changes to the company during its
history? (e.g., types of employees, strategic direction, etc.)
 Things you can cover … (3)

• Identify internal strengths and weaknesses

• You will need to:

• – Look at the value creation functions of the
company

• – Outline the functions in which the company is

currently strong and currently weak.

• – Make lists of these strengths and weaknesses

 Analyse the external environment

• The environmental factors relevant to the

industry
• The environmental factors that effect
companies
• The particular stage of the lifecycle that
the company is in
• • Other factors (for instance, demographic
factors, global financial changes,
• etc).
 Things you can cover … (5)

• Evaluate the SWOT analysis

• Is the competitive position of the company strong or
not?
• Can the strategic direction of the company continue?
• How can the company consolidate its strengths,
enhance its opportunities, overcome its threats and
minimise its weaknesses?
• Can it change its corporate strategies to achieve the
above or is something else needed?
• SWOT — not simply give a “shopping list” of the key
factors.
• Elaborate and discuss each factor in detail and
provide evidence for your claims.
 Things you can cover … (6)

• Analyse corporate-level strategy

• • Using information available, try to assess the strategic

corporate directions of the company.
• The following are very important:
• - line(s) of business of the company
• - its subsidiaries and acquisitions
• - the relationship among the company's core and non-core
businesses

• Questions such as the following will need to be answered:

• - Are resources exchanged freely between different parts of
the company?
• - Is synergy between the subsidiaries warranted or needed?
• - What is role of the company’s portfolio of investments?
• How diversified is the company?
• Does the company operate as a core business
• Is the company functioning as it should given the
current environment?
• Could changes in strategic direction and corporate
culture make a difference to its operations?
• Could weaknesses become strengths given certain
changes/environmental factors?
• Should the company consider merging or
diversifying?
• Has the strategy changed during its development as
a company?
• Were these changes good or bad overall? Why?
• What improvements can be made to the company’s
product lines? etc.
• Analyse Business-level strategy

• The aim of the company’s global competitive strategy—i.e., is it

differentiation, low cost, or targeted markets?, etc.

• The value of the investment goals of the company given its strategic
focus and the stage in the lifecycle of the company

• The product range of the company, its differentiation, and

competitiveness.

• How is the company using strategies to build competitive

advantage? (quality, efficiency, innovation, responsiveness to
customer needs, etc)
 Things you can cover …(7)
• What is the marketing strategy of each of the business
levels in the company?
• What production techniques are being used and how can
they be improved?

• Is the company doing research and development? Is it

effective and adequately tied to corporate aims?
• Does the corporate strategy accurately reflect the aims of
the company in terms of producing low-cost or
differentiated products?

• Has the company developed the right competencies in

terms of staffing, production techniques, marketing, etc?
• Can the company simultaneously pursue both a low-cost
and a differentiation strategy?
 Things you can cover … (8)

• Analyse structure and control systems

• • Different corporate strategies require different

structures. Issues you might like to consider:

• • Is the hierarchy or decentralized control of the company

adequate given the levels in the company?
• • Does it use a functional structure when it should be using
a product structure ?
• • Are the appropriate control systems being used?
• • Are appropriate rewards being given to managers?
• • Is cooperation among divisions being encouraged by a
suitable reward system?
 Things you can cover … (9)

• Make Recommendations
• • You will need to recommend precise courses of action that
the company needs to take.

• • Recommendations might include:

• – an increase in spending on specific research and

development projects

• – the divesting of certain businesses, a change from a

strategy of unrelated to related diversification

• – an increase in the level of integration among divisions by

using task forces and teams
 Headings for Writing the Solution
• Statement of the Problem : Describe what needs to be achieved
through proposed solution.

• The Case : Very brief narration of the situation / provide a context

for the various issues to be looked at.

• Scope of Analysis : What aspects of the case are being analysed.

• Possible Solutions & Evaluations

• Best Solution

• Conclusion
 Requirements
• Knowledge of the subject

• Analytical

• Critical thinking – go beyond obvious & question

• Ability to evaluate – use judgement

• Ability to infer
 Techniques
• Stratifications
Benchmarking
Force field analysis (driving & restraining forces)
Flowcharting

• SWOT
• 5 Force Model
• 7 S Frame work
• Nature of high performance business
• Vertical Integration
• Ansoff Product Grid
• BGC Matrix
Root cause analysis (5 why’s & 5 how’s)

1.why are customers dissatisfied?

becoz they are not receiving purchases on time

2.why are they not receiving on time?

Because we are backordered on stock.

3.why are we backordered?

Becoz we changed suppliers.

4. Why we changed suppliers?

Becoz the original supplier was late in shipments

5. Why haven’t we found another supplier?

Becoz we have not yet looked for one.
 How to Think

• Teaching Thinking -- A Guide for the Perplexed

He who learns but does not think is lost

(Chinese Proverb)
 DeBono’s Characterization of a Good Thinker

• Confident in his / her thinking

• In control of his/her thinking

– Does not drift from idea to idea or emotion to
emotion

• Has a clear idea of what he/she wants to do

– Defines the thinking task and then sets out to carry it
out
Has a clear focus and a broad view of the
situation

Values wisdom over cleverness

Likes thinking even when it isn’t

particularly successful

Confident and decisive but humble

• Robust in thought but practical were this is demanded

• Doesn’t wallow in over-intellectualization, nit-picking

or a dither of indecision

• Able to discern his/her progress after thinking

• Practices and observes thinking

 Levels of Thinking
• Knowledge: recalling information; repeating
information with no changes
– (ex: recalling dates; memorizing definitions for a history exam)

• Comprehension: Understanding ideas; using rules and

following directions
– (ex: explaining a mathematical law; knowing how the human
ear functions; explaining a definition in psychology)

• Application: Applying knowledge to a new situation

– (ex: using knowledge to solve a new physics problem)
• Analysis: Seeing relationships; breaking information into
parts; analyzing how things work
– (ex: comparing two poems by the same author)

• Synthesis: Putting ideas and information together in a unique

way; creating something new
– (ex: designing a new computer program)

• Evaluation: Making judgments; assessing value or worth of

information
– (ex: evaluating the effectiveness of an argument opposing the death
penalty)
EXERCISE : A CAPITAL OFFENSE
• At a meeting called for this purpose, Art Thompson, the CEO of
Paramount Metal Products, informed his top management team
of his growing concern that their aggressive expansion plans
might not be funded by United Industries, Paramount’s
corporate parent. During the ensuing discussion, Andrea Nagle,
director of corporate planning, argued that Paramount’s plants
needed to be running at or near capacity if the company was to
have any hope of receiving expansion capital from its parent.
This assertion was quickly challenged by Brad Haugen, VP of
Manufacturing, who retorted, “If Andrea thinks that all we have
to do to get capital is to have our factories running full-bore, she’s
terribly naïve.”

• To wipe away the smirks and chuckles that followed Haugen’s

comment, how should Andrea have responded?
 Exercise 2
• RIL is going through a crisis of sorts. The
brothers are fighting over controls & the
investor public are watching with keen interest.
The government is an onlooker too & this belies
the hopes thousands of small investors who
need some assurance that they would not loose.
In the stock market not many believe that this
will have a negative impact.

• What do you feel ?

Grow zone

Know
zone
 WHY THINKING SHOULDN’T BE TAUGHT

• People don’t need to be taught how to think.

– Thinking skills are acquired naturally, in the course of everyday
life.

• Thinking is domain or task-specific.

– There’s nothing useful to be learned about thinking in general.

• Thinking can’t be taught.

– It’s mostly a matter of mental habits, dispositions, and capacities

(e.g., intuition) that can’t be acquired through formal education.

• Thinking skills don’t transfer.

– Students aren’t able to apply their knowledge of thinking in new
situations.
 APPROACHES TO THINKING

• The “Domains” approach.

– “In marketing courses, you learn how to solve marketing
problems.”
• Deductive logic.
– Held to be the universal core and model of effective
thought.
• Formal decision theoretic methods.
– Prescriptions for making “rational” choices.
• “Soft” critical thinking.
– Asking questions; encouraging students to “think.”
• Functional models of problem solving/decision
making.
– The simple step-by-step way to solve any problem.
• Discussions regarding the culpability of CEOs at Enron
and other scandal-ridden corporations might take the
following set of statements into account:
– The CEO either knew what was going on or he didn’t know.
– If he knew, then he’s guilty of any crime committed with his
knowledge.
– If he didn’t know, then he’s guilty of ignorance, not
performing the CEO’s oversight role effectively.
• What can be concluded from this set of statements?
• What kind of argument is this?
• A SIMPLE CASE OF LOGIC
WHAT DOES ONE LEARN WHEN LEARNING
HOW TO THINK?

• General knowledge of how the world works.

– Much of this knowledge is embedded in, and acquired with, one’s
natural language.

• Meta cognitive skills.

– The ability to monitor and control one’s thinking.

• The cognitive virtues.

– Dispositions or habits of mind that support effective thinking.

• Abstraction skills

– Necessary for bringing past experience to bear on current

situations.
• Engineers at Florida Power and Light were responsible for
filling out forms to retire obsolete pieces of equipment.
Even though FPL accountants gave engineers an eight-
hour course on completing the paperwork, 80% of the
documents had mistakes.

• A Toyota worker had to date-and-time stamp over 2000

suggestions submitted by employees each month. This
protected against the possibility that an idea had been
submitted simultaneously by more than one employee. But
this had never happened. Toyota saved eight hours a
month by discontinuing stamping.

• A hospital performed two additional operations a week as a

result of better procedures for preparing instrument tables.
Previously, 70% of tables were improperly prepared,
causing delays while nurses searched for equipment.
• LEARNING BY ABSTRACTION
 THE COGNITIVE VIRTUES
• The cognitive virtues are mental habits or
dispositions that make thought more likely to
achieve its goals.

• They include:
– Thoughtfulness: Good thinkers are reflective or
mindful.
– Strategic: Thinking should be disciplined and planful.
– Unbiased: Thinking should be objective, unaffected by
irrelevant considerations.
– Validity: Good thinkers have a passion for truth.
– Clarity: Thinking should be as clear and precise as the
topic allows.
– Soundness: Arguments are cogent and rigorous.
– Flexibility: Beliefs are revised in light of new
evidence.
– Depth: Good thinkers try to understand deep causes
and meanings.
– Breadth: Good thinking is complete and
comprehensive.
– Open-mindedness: Good thinkers consider the
viewpoints of others.
EXERCISE : COMMON MENTAL MISTAKES

• I have a friend who is a professor. My friend likes to write poetry, is

rather shy, and is small in stature. Is my friend more likely to be a
professor of psychology or of Chinese studies?

• A group of students was given two equivalent versions of an aptitude

test. The ten students who scored highest on each test were identified
and given the other test, the one he or she hadn’t taken the first time.
How do you think their scores on the second test compared with their
scores on the first one? Were they better, worse, or about the same?

• A banker has been approached by a corporate borrower that is having

trouble repaying its loan. The borrower has asked for an additional
loan, arguing that this new capital will enable the company to “turn
the corner.” What thinking mistake might the banker be making in
recommending that the loan be approved?
 THE CONTENT OF THINKING SKILLS
• Learning how to think involves learning the following
kinds of content:

– Concepts: Basic units of meaning, relatively abstract, that enable

one to conceive problematic realities in productive ways. Thus,
sunk cost, ambiguity, presenting problem, and dependent variable.
– Principles: General guidelines that shape and direct thought. For
instance, claims should be supported by evidence and/or
arguments.
– Heuristics: Informal, quick-and-dirty, pieces of advice that can
usefully guide thought and action. Thus, to identify larger systemic
problems, ask, “How did we get into this mess?”
– Pitfalls: Common mental mistakes that are made in general or in
certain kinds of situations.
– Methods: Relatively formal techniques or procedures for
achieving certain goals. For instance, stratification, cause-and-
effect diagrams, the nominal group technique.
 EXERCISE : CONCEPTUAL CONFUSIONS
• During a meeting convened to address a serious sales
shortfall, a marketing executive protested that defining the
problem as “sales below budget” was a mistake, since “sales
below budget” isn’t a problem, but is instead a symptom.
– Is “sales below budget” a problem, a symptom, or what?

• We all know that a cause is whatever is responsible for or

produces an effect. Less widely recognized is the notion of
“condition,” passive enabling factors that may be necessary
for the effect to occur, but which do not actively bring it
about. Most of us are also familiar with the following
bumper-sticker argument against gun control: “Guns don’t
kill people; people do.”
– Analyzed in terms of causes and conditions, is this a true statement?
– Does the statement make a sound argument against gun control?
 GENERIC THINKING TASKS
• Much of the knowledge required for effective
thinking pertains to various generic thinking tasks
we encounter in our personal lives and
professional pursuits. These include:
– Research: Finding out certain knowable facts about a
situation.
– Diagnosis: Identifying the causes of a problem.
– Alternative Generation: Coming up with possibilities,
options, or good ideas.
– Design: Developing complex artifacts that satisfy
certain criteria and constraints.
– Prediction: Forecasting the likely future under
specified conditions.
– Evaluation: Assessing the goodness of entities or
alternatives according to certain criteria.
– Negotiation: Attempting to reach an agreement among
two or more parties over an issue.
 EXERCISE : DIAGNOSING CAUSES
• Difficulties were being experienced in a printed circuit
board production process due to eyelets that were too
small for boards. Necessary engineering change forms
and waivers were approved, allowing a slightly larger
eyelet to be used. Unfortunately, when the next lot of
PC boards reached the line, the new eyelets fit much
too loosely. What went wrong?

• A manufacturer produced motor shafts that didn’t fit

properly. Believing its equipment couldn’t hold the
required tolerances, management decided to buy a new
machine. But a consultant found that shaft variation
was minimal after machine downtime for lunch,
breaks, etc. What caused the variation?
 TOPICS FOR THINKING SKILLS
INSTRUCTION

• Fundamentals:
– Conceptual foundations.
– The psychology of thinking.
– Language and thought.

• Critical Thinking:
– Inquiry.
– Reasoning.
– Inferential errors.
– Argumentation.
 TOPICS FOR THINKING SKILLS INSTRUCTION

• Managerial Thinking:
– Thinking in group and organizational contexts.
– Problem solving.

• Problem-Solving Tasks:
– Problem identification.
– Problem definition.
– Problem analysis.
– Diagnosis.
– Alternative generation.
– Design.
– Decision making.
– Negotiation.
 EXERCISE : INFERENTIAL ERRORS
• Everyone has a right to his own property. Therefore, even
though Jones has been declared insane, you had no right
to take away his machine gun.
• Asked why his company was in three major lines of
business, a corporate executive replied, “A company is like
a stool. It needs at least three legs to be stable.”

• This proposal has been kicked around for more than

twenty years now. If there were any merit in the idea, it
would have been implemented a long time ago.
• There is intelligent life in outer space, for no one has been
able to prove that there isn’t.
• I fail to see why hunting should be considered cruel when
it gives tremendous pleasure to many people and
employment to even more.
 WRITTEN ASSIGNMENTS
– Analysis of thinking: A two page paper that requires students to
describe and analyze an episode from their past where their thinking
was less effective than it should have been.

– Critique of argument: A two page paper in which students analyze a

short ineffective argument—say, from a letter to the editor of a
newspaper—and identify its major inadequacies.

– Argument analysis: Students are asked to analyze an extended

argument, reporting their findings in a five-to-six page paper.
– Problem formulation: Students identify and define problems based
on their reading of a lengthy Harvard-type case. Five-to-six pages.
– Problem analysis: A five-to-six page paper in which students analyze and offer
recommendations regarding problems identified in a more focused case.
 Approaches The Skills Approach The Dispositions The Understanding Approach
Characteristics Approach

Theories, programs, De Bono – CoRT  Perkins - Dispositions Perkins - Understanding

ideas - examples Ennis - Taxonomy of theory of thinking  performances  Gardner -
critical chinking  Beyer Tishman - Thinking Understanding in the disciplines
- Direct teaching of dispositions  Costa -  Wiske - Teaching for
thinking  Perkins - Habits of mind  Baron understanding  Wiggins &
Thinking frames  -Theory of rationality  McTighe - Understanding by
Perkins & Swartz - Langer – Mindfulness  design  Paul - Critical thinking
Graphic organizers  Barrel – Thoughtfulness in the strong sense  McPeck -
Swartz & Parks –  Facione - Critical The reflective critical thinker 
Infusion  Sternberg - thinking dispositions  Brown - Community of learners 
Intelligence implied  Passmore - Critical Smith - Understanding as good
Treffinger, Isaksen & thinking as a character thinking 
Dorval - Creative problemtrait  Siegel - The spiritBrooks & Brooks - Constructivist
polving  Johnson & of the critical thinker  instruction  Lipman -
Blair - Informal logic  Sternberg - Successful Philosophy for children  Harpaz
Chaffee - thinking intelligence  & Lefstein - Community of
critically  Golman - Emotional thinking
Whimbey & Lochhead - Intelligence  Lipman -
Problem solving  Philosophy for children
Feuerstein. - Instrumental
Enrichment  Lipman -
Philosophy for children
Headings for Writing the Solution

Statement of the Problem : Describe what needs to be

achieved through proposed solution.

The Case : Very brief narration of the situation / provide

a context for the various issues to be looked at.

Scope of Analysis : What aspects of the case are being

analysed.

Possible Solutions & Evaluations

Best Solution

Conclusion
Interview At Mumbai
The Problem :
To determine the best way to reach Mumbai from Pune, in a fit
condition for an interview at 11 a.m. the following morning.

The Case
a. An important interview at Mumbai the following morning at 11
a.m. which cannot be postponed.
b. You are at Pune & its late in the evening.
c. The decision needs to be based on the data given in the narrative
since time is not available for more accurate data collection.

C. The boundary limits

Travel between Pune & Mumbai – late evening & 11 a.m. the
following morning.
Assumptions :
a. Clothes & papers required for the travel & the interview
are available.

b. some preparation will be desirable for the interview since

the notice for the interview has been received only now.

C..Mumbai & Pune are large cities. It is assumed that the

distance between your home & railway station is 2 kms &
between your home & airport is 9 kms.

d. it is appropriate to reach the interview appropriately

dressed & in proper state of mind.

eRoad block between Mumbai & Pune

f. Overnight stay at Mumbai

Possible Solutions & Evaluation

Solution 1 :
Travel by a shared taxi & avoid staying
overnight.

Merits : Time at Pune to prepare.

Less local taxi travel

Demerits :
Delay because all seats to be filled up
Relatively costly
Solution 2
Travel by Air

Demerits

Merits
Solution 3
Travel by deluxe bus

Merits

Demerits
 Solution 4

• Travel by Train

• Merit

• Demerit
 Best Solution

• Travel by first class in train leaving Pune

at 11.30 pm

• Discussion of Relative merits/ demerits

 Management Principle Application

• Decision Making techniques

 Implementation

• Pack your baggage, prepare for

interview

• Purchase tickets

• Reach Worli by 10.40 a.m.

 Conclusion
• Traveling first class in the train departing from
Pune at 11.30 pm will take one to Mumbai
economically, with maximum dependency, in
good time & in a good mental & physical state.
This mode will also give adequate facilities &
time for preparing for the interview & getting
ready. The problem thus has been solved in the
best possible manner by traveling first class in
the train.
Salesmen Costs
 Assumptions

• All territories A,B,C,D & E are similar & there are no

differences between the territories like hilly terrain,
backward areas, bulk buyers etc. There are no
heterogeneities.

• No restrictions for retaining particular sales men in a

particular territory.

• No salesmen has special training / relationship to customers.

• Management has culled data to optimize sales to salesmen

cost.
 Boundary Limits

• These will be the sales in the 5 territories.

 Possible Solutions
• Solution 1
• Number of customers different in 5 regions, salesmen in
smaller territories are making larger number of customer calls.
• Salary cost of each territory is almost the same. It is thus
suggested that some salesmen from territories C,D & E be
withdrawn & moved to A & B regions.

• Merits : Equitable distribution of salesmen with number of

customers.

• Demerits
• Across regions, uniformity of salesmen to customers difficult
• No control on number of calls / order size
• Not control other overhead expenses
 Solution 2
• To lay down maximum & minimum number of calls,
effective calls & maximum expenses that may be allowed.
• Standards say 10 – 12 calls per customer & on expenses etc.

• Merits :
• Standardization process in place
• Control becomes easy
• Easy setting of targets.

• Demerits
• No guarantee of sales
• Higher number of calls to near by customers.
• Stipulated number of calls – loose business – Follow up.
 Solution 3
• Number of customers vary between 50 – 195. Necessary to
redistribute the size of territories. Each territory should have
175 – 200 customers. Each customer should be visited 10-12
times & cost to sales ratio should not exceed 6 %.

• Merits :
• Covers all important factors
• Good customer coverage
• Improved attention to customers
• Lesser number of territories

• Demerits
• Some salesmen may become surplus
• Increase in territory size & distance
Selected Solution