Management is a process of getting things done with and through people in organization.

Management is an attempt to improve efficiency and effectiveness in the use of resources

by getting work to flow multi-directionally through an organization.

Management Functions:
1.Planning, 2.Organizing, 3.Staffing, 4.Directing, & 5.Controlling

1. Planning: Planning is conscious determination of future course of action. It includes

determination of projects and programmes, setting of policies and strategies. DOCOMO
efficient planning for changing in future technology helped it become the Japanese
Wireless Leader. Earlier in May 2002, phone company, announced a net loss of ¥ 116.19
billion1 and a goodwill write-off of ¥ 624.6 billion for the fiscal ending March 2002.

a. To sustain its position in the market against Motorola, DoCoMo decided to

stop taking rental security deposits on handsets and started manufacturing its
own handsets with 2g technology in 1997.
b. Managers heavily emphasized on R&D department and launched optional I-
mode service and thus provided access to more than 15000 websites through
mobiles, which were specially adapted to be viewed on their handset screens.
This enabled subscribers to perform many Internet functions such as
exchanging e-mails, checking stock quotes, getting maps, viewing train
schedules, buying movie tickets, making online purchases, downloading new
ring tones or playing games. Kiddi and J-phone suffered a serious set back in
their sales through this strategy of DoCoMo. According to reports, on an
average, I-Mode generated 30% higher revenues per subscriber as compared to
DoCoMo’s phones that provided only voice services. In 2000, the company
reported a net income of $ 2.4 billion, a 39% increase from the previous year.
c. In mid 2002, it was reported that DoCoMo was facing problems in convincing
its partner wireless companies in other countries to adopt its technology.
Reportedly, its partners were reluctant to spend huge amounts in upgrading
their wireless networks as they feared that DoCoMo’s products and services
 might not attract as many customers in their countries as expected. According
to reports, these companies had spent billions of dollars in acquiring licenses to
operate 3G services and landed in huge debts. To attract subscribers, DoCoMo
had to offer heavy discounts on FOMA handsets and services. During this
period, the company also began offering free global roaming to its FOMA
customers to retain its existing customers and to lure new customers.
According to the company sources, such discounts and free offerings took a
heavy toll on the company’s revenues DoCoMo brought of the concept of GPS
in their mobile phones Meanwhile, DoCoMo’s 3G initiative also began
showing signs of revival. This was on account of the company’s efforts to
reduce the weight of its handsets and increase their battery life, combined with
aggressive advertising which positioned 3G services as an ‘affordable’ service.
The company also increased the coverage of the service during 2002, and by
April 2003, covered 90% of Japan’s population. On account of these
initiatives, by April 2003, FOMA subscribers increased to 330,000, with
140,000 subscribers signing up in March 2003 alone (though DoCoMo sources
was reported to have expected FOMA subscribers to reach 1.5 million by
March 2004).
d. In April 2003, DoCoMo launched a ‘wrist-watch with phone’ and also
announced plans to launch six new 2G camera phones in collaboration with
Sony, Sharp, Fujitsu and Mitsubishi. These camera phones were to offer the
fingerprint-authentication feature and a special feature that allowed users to
download images on to a small memory chip and print them at their
convenience.

Thus through this case study we see that market environment is quiet dynamic and
flooded with risk. In order to move swiftly managers must have a precise futuristic
view so that leaders of today may not become lagers of tomorrow.

2. Organizing: Organizing is the process of dividing work into convenient tasks or

duties. Organizing means grouping of duties by position or by departments. We know
that there are various department in an company to keep work organized or systematic
such as Production, R&D, Marketing and Sale etc. Even if a single department of
works inefficiently if affect adversely on complete organization. In this case we will
see that Cisco failure of Production department in judging market demand severy set
back the company progress. Cisco designed an operating software called IOS (Internet
Operating System) that could route streams of data from one computer to another. The
software was loaded into a box containing microprocessors specially designed for
routing. This was the router, a machine that made Cisco a hugely successful venture
over the next two decades. In August 2001, the San Jose, California based, computer-
networking company Cisco Systems Inc (Cisco) surprised industry observers by
announcing its first ever negative earnings in more than a decade. In the third quarter
of fiscal 2001, the company’s sales had decreased by 30%. Cisco had to write off
inventory worth $ 2.2 billion and lay off 8,500 people.

a. In spite of an efficient supply chain network, Cisco ran into some problems.
Transactions between suppliers and contract manufacturers were not always
smooth. There were time lags in delivery and payment, and thus greater
opportunity for error. As a result, suppliers were plagued by long order-to-
payment cycles. In June 2000, Cisco discovered, to its alarm, that it was running
short of some key components for some of its equipment. Due to the shortage of
components, shipments to customers were delayed by 3–4 weeks. Though
demand for Cisco’s products remained healthy, the revenues of customers who
were used to delivery within two weeks were affected badly. Cisco revamped its
supply chain management to reduce the long ordering cycles. The company
launched Cisco Connection Online (CCO), which connected Cisco with all its
suppliers and contract manufacturers online. As a result, when a customer placed
an order, it was instantly communicated to all its suppliers and manufacturers. In
most cases, a third party logistics company shipped the product to the customer.
CCO ensured increased co-ordination and connectivity between supply partners,
thus reducing the operating costs of all constituents. Automated processes within
the supply chain removed redundant steps and added efficiencies. For instance,
changes in market demand were communicated automatically throughout the
supply chain. CCO reduced payment cycles for suppliers and eliminated paper
based purchasing. As a result, suppliers agreed to charge lower product markups.
Consequently, Cisco saved more than $ 24 million in material costs and $ 51
million in labor costs annually. CCO enabled Cisco’s contract manufacturers to
find out the exact position of demand and inventory at any given point of time. As
a result, they could manage replenishment of inventory with ease. This resulted in
a 45% reduction in inventory and a doubling of the inventory turnover. Cisco
slashed the inventory holding of its suppliers and manufacturers and brought it
down from 13,000 units (approx) to 6,000 units within 3 months.

b. However, some of Cisco’s large customers were not able to access CCO
because it did not connect seamlessly to their back-end or electronic data
interchange systems. These firms, typically telecom equipment distributors or
network operators, lacked the time to visit the supplier websites to order the
equipment they needed Supply chain of Cisco introduced the Integrated
 Commerce Solution (ICS) for these customers. ICS provided a dedicated server
fully integrated into the customers’ or resellers’ Intranet and back end ERP
systems. It facilitated information exchange between Cisco and them, besides
speeding up transactions. It had all the e-commerce applications of CCO, with
the additional capability of pulling order related data directly from Cisco’s back
end ERP systems online

c. In early 2001, the global IT business slowdown and the dotcom bust altered the
situation. Reportedly, Cisco failed to foresee the changing trends in the industry
and by mid 2001 had to cope with the problems of excess inventory. As a result,
the company had to write off inventory worth $ 2.2 billion in May 2001. In
order to lock-in supplies of scarce components during the boom period, Cisco
ordered large quantities in advance on the basis of demand projections made by
the company’s sales force. To make sure that it got components when it needed
them, Cisco entered into long-term commitments with its manufacturing
partners and certain key component makers. These arrangements led to an
inventory pile-up since Cisco’s forecasters had failed to notice that their
projections were artificially inflated. Many of Cisco’s customers had ordered
similar equipment from Cisco’s competitors, planning to eventually close the
deal with the party that delivered the goods first. This resulted in double and
triple ordering, which artificially inflated Cisco’s demand forecasts. Cisco’s
supply chain management system failed to show the increase in demand, which
represented overlapping orders. For instance, if three manufacturers competed
to build 100 routers, to chipmakers it looked like a sudden demand for 300
machines.
In reply to this Cisco introduced E-hub. It was intended to help eliminate
bidding wars for scarce components and overlapping of orders. EHub was
expected to eliminate the need for human intervention and automate the flow of
information between Cisco, its contract manufacturers and its component
suppliers. eHub used a technology called Partner Interface Process (PIP) that
indicated whether a document required a response or not. For instance, a PIP
 purchase order could stipulate that the recipient’s system must send a
confirmation two hours after receipt and a confirmed acceptance within 24
hours. If the recipient’s system failed to meet those deadlines, the purchase
order would be considered null. This would help Cisco to find out the exact
number of manufacturers who would be bidding for the order. The forecast
went not only to contract manufacturers but also to chipmakers like Philips
semiconductors and Altera Corp.

3. Staffing: Staffing involves manning the various positions created by the organizing
process. It includes preparing inventory and identifuing the gap between man power
required and available. Identifuing sources from where people will be selected,
selecting people, training and developing them, fixing financial compensation,
appraising, motivating and coordinating them efficiently periodically.
Managers of Taj effectively performed this staffing function through their STAR and
BSS system.

a. The STAR system (Special Thanks and Recognition System) was developed in
accordance with Taj’s core philosophy ‘Taj People Philosophy’ TPP that
‘happy employees lead to happy customers.’ STARS, operative throughout the
year (from April to March), was open to all employees across the organization,
at all hierarchical levels. It aimed to identify, recognize and reward those
employees who excelled in their work. STARS was actively promoted across
the group’s 62 chain of hotels and among its 18,000 employees globally, out of
which 15,000 were from India. STARS had five different levels. Though
employees did not receive any cash awards, they gained recognition by the
levels they attained through the points they accumulated for their acts of
kindness or hospitality. ‘Level 1’ was known as the ‘Silver Grade’. To reach
this level, employees had to accumulate 120 points in three months. To attain
‘Level 2’, known as the ‘Gold Grade, employees had to accumulate 130 points
within three months of attaining the silver grade. To reach ‘Level 3’, called the
 ‘Platinum Grade’, employees had to accumulate 250 points within six months
of attaining the gold grade. To attain ‘Level 4’, employees had to accumulate
510 or more points, but below 760 points, to be a part of the Chief Operating
Officer’s club. ‘Level 5’ which was the highest level in STARS, enabled
employees to be a part of the MD’s club, if they accumulated 760 or more
points. Points were granted to employees on the basis of parameters like
integrity, honesty, kindness, and respect for customers, environmental
awareness, teamwork, coordination, and cooperation, excellence in work, new
initiatives, trustworthiness, courage and conviction, among others. Employees
could also earn points through appreciation by customers, ‘compliment-a-
colleague’ forums8 and various suggestion schemes. Employees could also get
‘default points’ if the review committee did not give feedback to the employee
within two days of his/her offering a suggestion for the betterment of the
organization. STARS helped employees work together as a team and appreciate
fellow employees for their acts of kindness and excellence. It enhanced their
motivation levels and led to increased customer satisfaction When a certain
number of points were collected, employees received gift hampers, cash
vouchers or a vacation in a Taj Hotel of their choice in India and they received
awards given by the MD of the Taj Group. This awards ceremony significantly
boosted their morale. The STAR system also led to global recognition of the Taj
Group of hotels in 2002 when the group bagged the ‘Hermes Award’

b.The group always hired ‘fresh’ graduates from leading hotel management
institutes all over India so that it could shape their attitudes and develop their
skills in a way that fitted its needs and culture. The management wanted the new
recruits to pursue a long-term career with the group. All new employees were
placed in an intensive two-year training program, which familiarized them with
the business ethos of the group, the management practices of the organization,
and the working of cross-functional departments. As part of the TPP, the Taj
Group introduced a strong performance management6 system, called the
Balanced Scorecard System (BSS) that linked individual performance with the
group’s overall strategy. BSS was based on a model developed by Kaplan and
 Nortan7, and focused on enhancing both individual as well as enterprise
performance. The BSS included an Employee Satisfaction Tracking System
(ESTS), which solved employees’ problems on a quarterly basis. As a part of
ESTS, Taj carried out an organization wide employee satisfaction survey in mid
2000 of about 9000 employees. According to this survey, the reported
satisfaction level was about 75 percent. The group aimed to increase this level
to 90-95 percent, and eventually to 100 percent. The group also took strong
measures to weed out under-performers. The group adopted the 360 degree
feedback system to evaluate the performance of all top officials, from the MD to
departmental managers, in which they were evaluated by their immediate
subordinates. The 360-degree feedback was followed by personal interviews of
individuals to counsel them to overcome their deficiencies. Departmental heads
in each functional area were trained. These departmental heads later trained
their own staff. The training included foundation modules and accreditation
programs that familiarized the employees with Taj standards.

4. Directing: When people are available in the organization, they must know what they
are expected to do in the organization. Superior managers fulfill this requirement by
communicating to the subordinates about their expected behavior. Once subordinates
are oriented, the superiors have continuous responsibility of guiding and leading them
for better work performance. A manager must have plenty leadership qualities for
directing employees effectively.

5. Controlling: Controlling involves identification of actual results, comparison of

actual results with expected results as set by planning process, identification of
deviation between the two. If any, and taking of corrective action so that the actual
results match with expected results.
As we can see through this process controlling and time controlling strategies adopted my
directors and producers of Lagaan the film was completed in time. This is to be noted
that in Jan 2001, a catastrophic earthquake hit the village of Bhuj, six months after the
shooting completed, and claiming 13,000 lives. Thus we see that if the project was not
controlled effectively and have delayed by 6 months than it might be possible that it
would have been interrupted severly.