Market Research Techniques and Operations Research

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Questions and Answers

What are the primary types of panels used in market research?

The primary types of panels are Consumer Purchase Panels, Advertising Audience Panels, and Dealer Panels.

How do consumer panels contribute to market analysis?

Consumer panels track purchase data over time, allowing for deeper analysis of market trends and consumer behavior.

What challenges do panels face regarding participation?

Panels often face attrition, as members may drop out over time, affecting data consistency.

In what way do advertising audience panels assist marketers?

Advertising audience panels provide data on viewership, listenership, and readership, which helps marketers assess the effectiveness of their campaigns. Signup and view all the answers

What role do dealer panels play in the retail sector?

Dealer panels provide retail audit data that tracks inventory levels, sales, and pricing across outlets. Signup and view all the answers

How can data collected from public sources be useful in Operations Research?

Data from public sources can provide essential information for developing algorithms and statistical models used in Operations Research. Signup and view all the answers

What role does optimization play in Operations Research?

Optimization aims to find the best possible solution among various alternatives by minimizing costs or maximizing profits. Signup and view all the answers

What distinguishes PERT from CPM in network analysis?

PERT focuses on the time required to complete each task, while CPM emphasizes the cost of completing those tasks. Signup and view all the answers

How does ratio analysis provide insights into a company's operational efficiency?

Ratio analysis evaluates financial statements to identify trends in liquidity, profitability, and operational efficiency. Signup and view all the answers

What are some risks that could lead to a product becoming obsolete?

Factors include rapid technological advancements, shifts in consumer preferences, and increased competition in the market. Signup and view all the answers

What is the primary purpose of benchmarking in internal analysis?

To compare a firm's business processes and performance metrics with industry best practices from competitors. Signup and view all the answers

In the Opportunity Matrix, what should a firm do with opportunities classified in Cell #1?

The firm should aggressively pursue these opportunities. Signup and view all the answers

Describe the recommended strategy for opportunities in Cell #IV of the Opportunity Matrix.

The opportunities should be ignored as they are too minor to consider. Signup and view all the answers

What does Cell #II represent in the Opportunity Matrix?

Opportunities that are low in attractiveness but have a high probability of success. Signup and view all the answers

How should a firm approach opportunities in Cell #III of the Opportunity Matrix?

The firm should closely monitor these opportunities. Signup and view all the answers

What are the two dimensions used in the Opportunity Matrix?

Attractiveness of Opportunity and Probability of Success. Signup and view all the answers

What is the importance of distribution effectiveness in a firm's strategy?

It ensures that products reach consumers efficiently and effectively. Signup and view all the answers

What role does innovativeness play in a firm's competitive strategy?

Innovativeness helps a firm differentiate itself and maintain a competitive edge. Signup and view all the answers

Study Notes

Entrepreneurship Management

Entrepreneurship is a process for value creation through recognition of business opportunities.
It involves managing risk-taking appropriate to the opportunity, and mobilizing human, financial, and material resources to complete a project successfully.
An entrepreneur discovers innovative ideas, develops them into products or services, markets them successfully, and nurtures the business with a consistent, tireless spirit.
Entrepreneurship involves the fusion of capital, technology, and human talent.
It is a dynamic and risky process that creates something from nothing.
Crucial elements include a flair for sensing opportunities, and the ability to recognize, seize, and exploit economic opportunities.

Dimensions of an Entrepreneur

Innovation: Improvisation and improvement, distinct from invention. Innovation brings a human aspect to invention and focuses on problem-solving and commercialization.
Need for Achievement: A higher-level human need that's most relevant to entrepreneurial behavior. Successful entrepreneurs are calculated risk-takers.
Planning Capability: Essential for mitigating risk and handling uncertainties in projects. Sophisticated planning is needed beyond mere forecasting.
Organization Building Ability: Includes mobilizing human, financial, and material resources. Building a meaningful hierarchy and defining roles and relationships within the organization is crucial.
Leadership Quality: The entrepreneur plays a critical leadership role in motivating and directing team members.

Modern Entrepreneur Traits

Visionary Leader: Guiding the company's direction.
Organization Builder: Creating a strong and structured organizational framework.
Excellent Manager: Effectively guiding all functions and resources.
Capable Administrator: Guiding operations to meet organizational goals.

Difference Between Manager and Business Leader

Manager:
- Revenue Earner
- Works with existing resources.
- Enjoys formal authority.
- Cannot make sweeping changes.
- Roles are well-defined with boundaries.
Business Leader:
- Earns profits.
- Creator of wealth and assets.
- Leader of people.
- High achiever.
- Great motivator.
- Role model.

Exploring Marketing Opportunities

Scanning the external environment to identify opportunities due to changes in the environment.
Identifying macro-environmental factors that affect business.
Analyzing the dynamic nature of macro-environmental factors to spot marketing opportunities.

Macro-Environmental Factors

Demographic factors (age, age groups, generations, gender, income, family composition)
Economic factors (purchasing power, demand, disposable income, economic indicators, overall state of the economy)
Technological factors (technological growth, rate of adoption, obsolescence)
Political factors (political stability, government's approach, infrastructure)
Legal factors (government laws and regulations for business)
Social factors (social classes, purchasing power levels)
Cultural factors (culture, values, customs, traditions)

Micro-Environmental Factors

Demand-related factors (nature of demand, current demand levels)
Factors relating to Customers (purchasing power, buying motives, attitudes, brand awareness, loyalty)
Factors relating to Suppliers (continuity of supply, dependability)
Factors relating to Employees
Industry & Competition
Firm's internal environment (Strengths, Weaknesses)

SWOT Analysis

Strengths: Internal analysis
Weaknesses: Internal analysis
Opportunities: Environment scanning
Threats: Environment scanning

Internal Analysis Parameters

Market Share
Customer satisfaction levels
Product Quality
Service Quality
Price effectiveness
Distribution effectiveness
Promotion effectiveness
Selling effectiveness
Intensity of distribution coverage
Innovativeness
Benchmarking

Opportunity Matrix

A 2x2 matrix for evaluating opportunities.
- Based on attractiveness of the opportunity and probability of success.
- Four cells representing four possible scenarios:
- (1) High Attractiveness/High Probability (Pursue aggressively)
- (2) Low Attractiveness/High Probability (Monitor closely)
- (3) High Attractiveness/Low Probability (Monitor closely)
- (4) Low Attractiveness/Low Probability (Too minor to consider)

Threats Matrix

A 2x2 matrix to assess threats.
- Based on likelihood and severity of threats.
- Four cells representing four possible scenarios.
- (1) High Severity/High Likelihood (Prepare Contingency Plans)
- (2) Low Severity/High Likelihood (Monitor Closely)
- (3) High Severity/Low Likelihood (Monitor Closely) -(4) Low Severity/Low Likelihood (Ignore)

Project Formulation Stages

Feasibility Analysis
Techno-Economic Analysis
Project Design and Network Analysis
Input Analysis
Financial Analysis
Social Cost Benefit Analysis
Pre-Investment Analysis

Project Appraisal Methods

Payback Period
Average Rate of Return Method
Net Present Value Method
Benefit-Cost Ratio
Internal Rate of Return

Project Finance

Capitalization and Fixed Assets: Determining the required funds for acquiring fixed assets.
Capital Structure: Balancing equity and debt financing to minimize capital cost and maximize returns.
Sources of Fixed Capital: Public borrowing, lease financing, retained earnings, equity issues, preference shares, debentures, term loans, deferred credit, development loans, and unsecured loans.

Working Capital

The capital needed for day-to-day operational needs.
Components: Cash, Bank Balance, Accounts Receivable, Inventory, Advances Paid
Net Working Capital - Current Assets minus Current Liabilities
Factors influencing Working Capital Requirements: Operating Cycle, Sales Volume, Seasonality, Cyclical Factors, Nature of Business, Terms of Credit, Inventory Turnover, Technology, Contingency Plans

Human Resource Management

Human resources form the core of any entrepreneurial endeavor.
Leadership is paramount for efficiently managing human resources and all other resources.
The entrepreneur is the primary leader, responsible for understanding and motivating employees.
Key aspects of human resource management:
- Leadership principles
- Traits related to leadership
- Theories of leadership
Behavioral Theories (Ohio State, Michigan State, Managerial Grid)

Leadership:

Leader vs. Manager: Leaders inspire, evolve, have a vision, and exercise informal power while managers are appointed, work with targets, have formal authority, and operate within structure.
Fiedler's Contingency Model: Assesses leadership effectiveness based on leader traits and situational factors (leader-follower relationships, task structure, and position power).
Situational Leadership (Hersey-Blanchard): Adjusts leadership style based on follower maturity levels (directing, coaching, supporting, delegating).
Path-Goal Theory: Motivating followers by clearly defining goals, clarifying the path, removing obstacles, and providing support.
Personality & Leadership: A leader's sum characteristics (traits) influences their interactions with others. Various personality traits such as ambition, integrity, and self-confidence contribute to effective leadership.
Big 5 Model: Five facets of personality—extraversion, agreeableness, conscientiousness, emotional stability, openness to experience—influencing leadership effectiveness.
Impact of Age and Gender on HR
- Age: Positive impact- experience, commitment, judgment, capability, training avoidance but more risk aversion
- Gender: Women exhibit higher absenteeism in organizations.

Factories Act, 1948

Objectives: Consolidating and amending laws regulating workers, and ensuring health, safety, and welfare in factories.
Important Definitions: Defines terms like factory, worker, adult, adolescent, child, and the calendar year.
Factory Definition (Sections 2(m) and 2(ii)): Specifies premises and criteria involving a prescribed worker count and presence of manufacturing processes or activities employing a minimum worker count.
Definitions of Age Categories: Discriminates between adult, adolescent, and child ages.
Provisions on Health & Hygiene: Details for cleanliness, disposal of wastes, ventilation, temperature control, dust & fume control, artificial humidification, overcrowding, lighting, water supply, and latrine/urinal provision.
Safety Provisions: Outlines provisions for machinery, self-acting machines, protective gear, dangerous equipment, and the specific responsibilities of a safety officer.
Welfare Provisions: Covers details for canteen facilities, crèches, and welfare officers, stipulating specific responsibilities and required aspects.

Financial Analysis of a Project (Steps)

Projected Capital Costs (plant, machinery, spares, freight, taxes, installations, land, building)
Projected Operating Costs (raw materials, labor, supervision, energy, maintenance, depreciation, interest)
Projected Operating Revenues (gross, net, gross margin, EBIT, PBT, PAT, retained earnings)

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Description

Test your knowledge on various panels used in market research and their contributions to analysis, as well as the critical concepts in Operations Research. This quiz covers challenges in participation, roles of advertising and dealer panels, and the importance of optimization and benchmarking in business decisions.