Case-1- Farm Equipment Limited

Farm Equipment Limited (FEL) is engaged in manufacturing farm equipment of

different types. It markets its equipment through a network of distributors located
nation-wide. Besides, it also exports its equipment to different countries. The
Chairman of the company is quite satisfied with performance of the company. One
day, a meeting of distributors held at the company's headquarters. In the meeting,
the Chairman also participated. After some discussion about the distribution
strategy, almost all distributors urged the Chairman to introduce some new models
to satisfy the changing demands of customers. The Chairman who had engineering
background recognised the implications of distributors' suggestions but suggested
that introduction of the new models would require heavy investment in research
and development. Further, changes in the highly automated models production line
would be very costly, His argument was,
"The company has been quite successful even with a limited number of models.
Therefore instead of introducing new models, it would be more appropriate to cut
the cost of production of the existing models and reduce their price. After all what
customers want is value for their money. with this argument, the Chairman decided
not to introduce new models but insisted to cut the cost and price of the existing
models. However, he agreed to seek the opinion of a consultant to test the validity
of his decision.

Questions: -
1. It is often said that to be successful, an organisation must be an open system.
What management implications, does this statement have and how can this
statement be applied in this case
2. Suppose that you are required to work as a consultant to FEL, what suggestions
will you give to the company and why? What additional information will you
require from the company to make your suggestions?
Case:2 Action Technology Limited

Action Technology Limited (ATL), a software developement company, was

promoted by its present managing director G.R. Vikas. Vikas almost hates
bureaucracy and believes in the autonomy of people at the workplace. There are
about 450 employees with the company. All the employees are free to come to
office at their own convenient time. Similarly, they can leave the office at any time
and can work up to any time including past mid-night. The idea is that an
employee should work only at that time when he feels that he is the most
productive. Workplace remains open for twently-four hours. There are no set
policies regarding various types of leave like sick leave, paid holidays, or any other
leave. Vikas believes that fixing a fixed number of days for sick leave is arbitrary
because an employee may require more number of days or not a single day as
sickleave. While hours of work and leave policies are quite flexible, employees
frequently put in at least 50 hours a week.
In addition, regardless of number of hours worked, every employee is required to
be accessible via e-mail, cell phone, instant messaging, or laptop. Every employee
sets his weekly and monthly production target in consultation with management.
Every employee is given plenty of autonomy to achieve the target and his
performance is measured in terms of this target. Those who are on target achievers
are counselled to improve themselves. On non-improvement, services of non-
achievers are terminated. In one year, about 6 per cent of non-achievers were fired.
ATL is doing quite well with about 33 per cent annual growth rate with
commensurate profitability. In the process of selecting employees, care is taken
that only those candidates are selected who believe in autonomy and have
sufficient internal motivation to get the things done. They are trained to imbibe
company's work culture. At the interview level, applicants are encouraged to ask
any question about the company and its work pattern.

QUESTIONS:-
1, What kind of approach has been adopted by ATL in designing its structure?
2. Do you think whether this pattern will remain effective if the company grows
larger?
CASE 3: CONSUMER PROTECTION ACT, 1986

The purpose of the National Consumer Disputes Redressal Commission (NCDRC)

is to provide cost-effective, quick redressal of consumer disputes. This case study
describes a case filed/disposed of relating to the protection of consumer rights.

In 2012, Jagannath Hirav and Baby Hirav booked a flat on the 60th floor of a
luxury
project named Lodha Dioro at New Cuffe Parade in Wadala, Mumbai. However,
their Mumbai-based builder Lodha Crown Buildmart Private Limited did not
deliver the flat as promised. Therefore, the couple filed a complaint against the
builder under the Consumer Protection Act, 1986.

They alleged that they had booked a 3 BHK flat on the 60th floor of the proposed
building for a price of INR 4,45,68,432 and paid a sum of INR 14 lakhs separately
for two parking spaces.

In 2013, the Mumbai Metropolitan Region Development Authority (MMRDA)

granted commencement certificate to the proposed building project for only
ground-
plus-53 floors and not 60 floors. According to the complaint, the builder demanded
additional payment for the 60th floor despite MMRDA’s non-permission to
construct beyond 55 floors.

In 2015, the builder cancelled the allotted flat of the couple due to non-payment
of extra charges. Consequently, the couple went to the Consumer Protection court
and filed a complaint to seek refund of the deposited amount and compensation for
the damages. In their complaint, they alleged that Lodha did not inform them on
reduction in the number of floors and kept demanding a balance amount as per the
agreement for a flat on the 60th floor. In this way, the builder misrepresented and
suppressed the true and material facts in the registered agreement.
In defence, the builder alleged that the couple were traders who had booked the flat
only for reselling purposes, and therefore cannot be regarded as ‘consumer’ as per
the Consumer Protection Act, 1986. The builder also offered to refund the
deposited
amount or offer a new flat in the same building (on the 50th floor). However, the
couple refused the offer.

Subsequently, it was revealed that the builder did not have the permission to build
even beyond 45 floors due to height restriction by the Airports Authority of India
(AAI).

Result

The National Commission heard the complaint and keeping all the points in mind
passed an order in favour of the homebuyer couple. It directed the builder to refund
INR 2.52 crore along with 9% interest per annum. It also held the directors of
Lodha
Crown Buildmart Private Limited, Ramandas Pandey and Pranav Goel, liable to
pay
the amount.

QUESTIONS; -

1. Why did the National Commission pass the order in favour of the home buyer?

Explain in your own words the points in favour of the judgement.

2. Why did the National Commission dismiss the plea by the builder that the
couple

was not a ‘consumer’?

CASE 4: ROLE OF GOVERNMENT IN BUSINESS
ENVIRONMENT

Provisions by which politically associated firms get economic favours are very
common nowadays, but little is known of the effects or form of influence in
business government affairs. Not much is known about the firm-level political
influence or its significance. What characterises the bargain between governments
and influential firms? How do influential firms pay governments, in exchange for
any benefits they receive? Recent firm-level analyses have examined various
determinants of political influence, and how these connections influence market
valuation while some have detailed the networks through which the benefits
accrue. Still others, finally, have explained how ‘‘systems’’ of influence come into
being, and why they endure. Much less is identified, however, of how these
political connections influence decisions within firms or of the strings that may
come along with political influence.

A general model in which influence entails firms to offer goods of political value
in return for economic privileges. An investigation on both the characteristics
that define political influence among firms in developing countries and the effects
of that influence on company performance and behaviour. An argument that
political influence develops the business environment for selected firms through
industrial or quasi-industrial policies, but restricts their ability to fire workers.
Under such conditions, if political influence primarily sinks fixed costs over
variable
costs, then favoured firms will be less favoured to invest and their output will ache,
even if they earn more profits than non-influential firms. Depending on the World
Bank’s Enterprise reviews of approximately 8000 firms in 40 developing countries,
and control for a number of prejudices present in the data. Our viewpoint is that
influential firms benefit from lower managerial and monitoring barriers (including
bribe taxes), superior pricing power, and easier entree to credit. But these firms
also deliver politically valuable benefits to occupants through bloated payrolls and
greater tax payments. At last, these firms are worse-performing than their non-
influential foils. The results highlight a potential channel by which cronyism leads
to obstinate underdevelopment.

QUESTIONS:-

1. Discuss the role of politics in the above case.

2. Discuss the role of government in a business environment.

CASE 5 : COCA-COLA’S MICRO ENVIRONMENT

The marketing department of Coca-Cola develops core strategies for company

brands to make sure that all communication is consistent in all the markets. With a
combined effort, the Coca-Cola system attempts to maximise its resources for
profitable growth and market leadership. The marketing departments are
responsible for product’s advertisement, marketing and promotion. If all these
departments
perform their duty effectively, then the objectives of the Coca-Cola Company will
be met.

Coca-Cola agreed to swap some brands and buy a 17% stake in Monster Beverage
Corp. for about $2.15 billion, increasing its bet on the rapid growth of the energy-
drink market. Under the agreement, the two companies will share their production,
marketing and distribution. Marketing intermediaries aid the company in
promoting, selling and distributing its goods to the end customers. Intermediaries
encompass marketing agencies, distribution firms and resellers. For example, in a
deal, Coke joined hands with a US-based company Wendy that it will provide coke
to all the fast food chains located in the US.

In this case, Wendy is an important example of intermediary for coke.

Suppliers offer raw materials and resources that are required by the firms to
produce
goods and services. For example, bottling partners is a company-owned entity,
namely Hindustan Coca Cola Beverages Ltd. Suppliers always play a crucial role
in the operations of every firm. Customers of coke differ massively in terms of age.
From kids to youngsters, youngsters to elders and elders to older people, coke has
always captured high customer attention for decades. For example, with the help of
market survey,

Coke finds that one million US population drinks coke with breakfast every single
day. This is how coke has been favourite drink of customers for centuries. Recent
survey shows that coke is the only product in the world of which more than 85%
of the population is well aware. All companies have to keep updated study of their
customers. In case of coke, the company has always maintained excellent customer
retention. Coca Cola’s annual Stakeholder Panel is particularly insightful with
members of the Panel drawn from NGOs, academia, investors, trade associations,
suppliers and other
technical experts. The Panel’s scope is to identify emerging risks and
opportunities, and to encourage company demonstrate ever-greater leadership and
innovation.

QUESTIONS:-
1. What are the micro business environment components of Cola-Cola as in the
case
mentioned above?

2. How has Coca-Cola maintained its customer base?