A STUDY ON PROBLEMS FACED BY IT INDUSTRY IN MADURAI.

Submitted in partial fulfillment of requirement for the award of the degree of Master of the Business Administration of Madurai Kamaraj University

By R.INFANT MYCHILINE PRIYA (Reg No.: 2K10MBA14)

Under the guidance of Mrs. M. Nagarenitha, MBA, M.Phil, (PhD)

DEPARTMENT OF MANAGEMENT STUDIES FATIMA COLLEGE (AUTONOMOUS) (WITH POTENTIAL FOR EXCELLENCE) RE-CREDITTED WITH A GRADE BY NAAC MARY LAND MADURAI-625018 JAN- 2012

CERTIFICATE

This is to certify that the work entitled A STUDY ON PROBLEMS FACED BY IT

INDUSTRY IN MADURAI. is a bonafide record of work done by R.Infant Mychiline Priya

(2K10MBA14)

Submitted in partial fulfillment of the requirement for the degree of Master of Business Administration of Madurai Kamaraj University.

Faculty Guide

Director Department of Management Studies

(Mrs. M. Nagarenitha, MBA, M.Phil, (PhD))

(Dr. Mrs. P. Uma, BE, MBA, PhD)

FATIMA COLLEGE (AUTONOMOUS) DEPARTMENT OF MANAGEMENT STUDIES MADURAI-625018.

DECLARATION

I hereby declare that the work done under the title A STUDY ON PROBLEMS FACED BY IT INDUSTRY IN MADURAI submitted for the award of the Degree of Master of Business Administration is my original work and that no part of this project has been submitted fully or partly for any other recognition earlier.

Place: Madurai

Signature of Student

Date:

(INFANT MYCHILINE PRIYA.R)

ACKNOWLEDGEMENT

First and foremost I would like to thank God almighty whose blessings made me to complete the project successfully. It is a great pleasure to acknowledge my sincere thanks to DR.REV. Sr. Josphine Nirmala Mary, Principal, Fatima College, Madurai for giving this great opportunity. It is a great pleasure to acknowledge my sincere thanks to Sr. Celine Sahaya Mary, Dean, Professional Courses, Fatima College, Madurai for giving the opportunity to get practical knowledge about our theoretical studies. I also thank Mrs.P.Uma, Director, Department of Management Studies for the successful completion of this project work. I indeed greatly thankful to my faculty guide Mrs. M. Nagarenitha I thank her for guiding me to successfully complete my project work. I express my sincere gratitude towards Mr. Sivarajah Ramanathan for giving me permission and also I extend my thanks to guide me to do this project in Winways Systems Pvt Ltd, Madurai.

I wish to express my gratitude to all the staff members in the Department of Management Studies for their encouragement for completing this project. Finally I thank my teachers, owner-managers, friends and parents who helped me in completing my project successfully.

CONTENTS

Chapter No

Particulars

Page

INTRODUCTION 1.1 Introduction About the Topic 1.2 Industry Profile 1.3 Company Profile 1.4 Need of the Study 1.5 Scope of the Study 1.6 Objectives 1.7 Limitations of the Study 13 14 16 22 23 24 25

II

REVIEW OF LITERATURE

26

III

RESEARCH METHODOLOGY 3.1 Research Meaning 3.2 Research Design 3.3 Method of data collection 3.4 Research Instrument or Tools 30 30 31 32

IV

ANALYSIS AND INTERPRETATION

35

FINDINGS SUGGESTIONS CONCLUSION

110 112 113

BIBLIOGRAPHY

114

APPENDIX

115

List of tables S.NO Title of the table PG.NO

1 2 3 4 5 6 7 8 9 10 11

Gender Wise Classification of the Respondents Reason for Choosing IT Field Reason for Choosing Madurai for Setting IT Business Level of Importance for Innovation Proficiency of Project Planning and Fund Requirement Analysis Difficulties Faced by the Concerns When Starting the Business Type of Finance the Concerns Received from the Initial Stage Requirement of Funds in Next 3 to 5 Years Accessibility of Funds from External Sources Procedure for Accessibility of Funds from External Sources Proficiency of the Professional Marketing Concepts and Right Application of Them to Products and Services

36 38 40 42 44 46 48 50 52 54 56

12 13 14 15 16 17

Positioning of Brand Name of Product or Service Reasons for Loyalty of Customers to the Products or Services Pre-launching Survey Marketing Problem Opinion Towards Exposure Initiative to Travel
7

58 60 62 64 66 68

18 19 20 21 22 23 24 25 26 27 28 29 30 31 32
33

Preferences of Seminars that the Concerns Need to be Availed Preference to Travel to Other Cities Brand of Computer Systems Used by the Concerns Speed of the Broadband Service Provision of Same Speed Variation of Speed Provided by the Broadband Service Frequency of Changes in the Software used Level of Open Source Adoption Frequency of Servicing the Computer Systems Concerns Point of View about the CSR Activities Concerns Engaging in the CSR Activities Concerns that Face Problems in Engaging CSR Activities Chi Square Test- Type of Ownership of the Concern and the Type of Financial Arrangements Made Availed Chi Square Test- Current Phase of Marketing and Mode of Marketing Percentage Analysis- Preference of Broadband Service Provider for its Features Two Way ANOVA- Preference and Level of Satisfaction of Services on Broadband Service Weighted Average Level - Importance Towards the CSR Activities

70 72 74 76 78 80 82 84 86 88 90 92 95 99 102 103 106

34

35
36

Weighted Average Level - Proficiency Towards the Management Strategies Weighted Average Level - Satisfaction Towards the Management Skills

107 108

List of charts

S.NO

Title of the chart

PG.NO

1 2 3 4 5 6 7 8 9 10

Gender Wise Classification of the Respondents Reason for Choosing IT Field Reason for Choosing Madurai for Setting IT Business Level of Importance for Innovation Proficiency of Project Planning and Fund Requirement Analysis Difficulties Faced by the Concerns When Starting the Business Type of Finance the Concerns Received from the Initial Stage Requirement of Funds in Next 3 to 5 Years Accessibility of Funds from External Sources Procedure for Accessibility of Funds from External Sources Proficiency of the Professional Marketing Concepts and Right Application of Them to Products and Services Positioning of Brand Name of Product or Service Reasons for Loyalty of Customers to the Products or Services Pre-launching Survey Marketing Problem

37 39 41 43 45 47 49 51 53 55

11

57

12 13 14 15

59 61 63 65

16 17 18 19 20 21 22 23 24 25 26 27 28 29

Opinion Towards Exposure Initiative to Travel Preferences of Seminars that the Concerns Need to be Availed Preference to Travel to Other Cities Brand of Computer Systems Used by the Concerns Speed of the Broadband Service Provision of Same Speed Variation of Speed Provided by the Broadband Service Frequency of Changes in the Software used Level of Open Source Adoption Frequency of Servicing the Computer Systems Concerns Point of View about the CSR Activities Concerns Engaging in the CSR Activities Concerns that Face Problems in Engaging CSR Activities

67 69 71 73 75 77 79 81 83 85 87 89 91 93

10

ABSTRACT

Global IT products and services market is at an estimated size of $ 1.5 trillion today. It is estimated that the share of IT in the GDP of nations will exceed that of any other industry in the next ten years. There is a great deal of inter-dependency even as fiercer competition emerges in a rapidly growing market. It is increasingly a border less world, due to the interactivity provided by the Internet and telecom infrastructure.

But there is only limited number of entrepreneurs who start their IT businesses in Madurai due to many problems that hinders their growth in Madurai. So there are less number of IT Companies in Madurai as compared to Chennai and Bangalore.

So to remove the obstacles for the entrepreneurs the root cause of the problem should be identified. Hence this study was conducted which would help entrepreneurs to start more IT businesses in Madurai which will contribute to the economic condition of Madurai.

11

INTRODUCTION
12

CHAPTER-1

INTRODUCTION ABOUT THE TOPIC

The IT sector has become one of the most significant growth catalysts for the Indian economy. The sector is estimated to have grown by 19 per cent in the FY2011, clocking revenue of almost US$ 76 billion. But as compared to Chennai, Bangalore the growth of IT industry in Madurai is relatively low. This is due to various reasons. One of the reasons is low investment capital. Whether the company is brand new or setting up an additional operation, business owners need to have a sufficient amount of capital on hand. Using business financing, such as debt or equity, may not be possible if the business is overextended on its external financing possibilities. Business financing may also not be possible if the company does not have a strong financial history. The next reason is limited economic resources or business inputs may create a difficult environment when setting up a business or additional operation. Traditional economic resources are land, labor and capital. In economic markets already saturated with software products or services, setting up an additional business may create even scarcer availability of resources. Even if resources are available in large quantities, new businesses may not have access to them depending on the agreements in place for existing companies currently using these resources. Another reason is a business usually requires individuals to conduct significant market analysis to determine the potential demand for the companys software products or services. Attempting to reach a small target market may not allow the company to earn the most profits on the sales of its products. Smaller markets also may subject to substitute or inferior products, decreasing the companys market share through competition. So to identify problems and other challenges in the IT industry the study has to be conducted.

13

INDUSTRY PROFILE

Information Technology (IT) industry in India is one of the fastest growing industries. Indian IT industry has built up valuable brand equity for itself in the global markets. IT industry in India comprises of software industry and information technology enabled services (ITES), which also includes business process outsourcing (BPO) industry. India is considered as a pioneer in software development and a favorite destination for IT-enabled services. The origin of IT industry in India can be traced to 1974, when the mainframe manufacturer, Burroughs, asked its India sales agent, Tata Consultancy Services (TCS), to export programmers for installing system software for a U.S. client. The IT industry is originated under unfavorable conditions. Local markets were absent and government policy toward private enterprise was hostile. The industry was begun by Bombay-based conglomerates which entered the business by supplying programmers to global IT firms located overseas. During that time Indian economy was state-controlled and the state remained hostile to the software industry through the 1970s. Import tariffs were high (135% on hardware and 100% on software) and software was not considered an "industry", so that exporters were ineligible for bank finance. Government policy towards IT sector changed when Rajiv Gandhi became Prime Minister in 1984. His New Computer Policy (NCP-1984) consisted of a package of reduced import tariffs on hardware and software (reduced to 60%), recognition of software exports as a "delicensed industry", i.e., henceforth eligible for bank finance and freed from license-permit raj, permission for foreign firms to set up wholly-owned, export-dedicated units and a project to set up a chain of software parks that would offer infrastructure at below-market costs. These policies laid the foundation for the development of the world-class IT industry in India. Today, Indian IT companies such as Tata Consultancy Services (TCS), Wipro, Infosys, and HCL et al are renowned in the global market for their IT prowess. Some of the major factors which played a key role in Indias emergence as key global IT player are:

14

Indian Education System The Indian education system places strong emphasis on mathematics and science, resulting in a large number of science and engineering graduates. Mastery over quantitative concepts coupled with English proficiency has resulted in a skill set that has enabled India to reap the benefits of the current international demand for IT. High Quality Human Resource Indian programmers are known for their strong technical and analytical skills and their willingness to accommodate clients. India also has one of the largest pools of English-speaking professionals.

Competitive Costs The cost of software development and other services in India is very competitive as compared to the West.

Infrastructure Scenario

Indian IT industry has also gained immensely from the availability of a robust infrastructure (telecom, power and roads) in the country. In the last few years Indian IT industry has seen tremendous growth. Destinations such as Bangalore, Hyderabad and Gurgaon have evolved into global IT hubs. Several IT parks have come up at Bangalore, Hyderabad, Chennai, Pune, Gurgaon etc. These parks offer Silicon Valley type infrastructure. In the light of all the factors that have added to the strength of Indian IT industry, it seems that Indian success story is all set to continue.

15

COMPANY PROFILE

Winways Systems Pvt Ltd is a socio-commercial organization, working based on the ideology of knowledge freedom. Winways Group is engaged in well-defined knowledge based business concepts having adherence to open knowledge principles. They strongly believe in freedom of knowledge. They support sharing of intellectual resources. They are actively involved in research, execution, sharing and collective enhancement of knowledge systems such as software development, education, publishing and other knowledge based services. They work for justified commercial opportunities. Like any world-class service organization, they do have all systems and structures to extend dependable solutions and services to their clients. Winways is operating in the areas of Open Source/Linux Solutions, Web Solutions, Training, Human Resource and Publishing. Their divisions are strategically positioned as independent, domain focused business units with clearly defined brand identity.

Vision Statement To become a highly valued and ethically dependable, Intellectual Resources Management company, recognizable by the highly placed global organizations. Explanation for the Vision Statement Highly valued represents higher brand reputation. Ethically dependable represents quality, integrity, honesty and customer centric. Recognizable represents penetration through marketing excellence. Highly placed represents top ranking. IT enabled Intellectual Resources Management represents Winways will always focus on business concepts based on the brainpower enriched by Information Technology.

16

Mission Statement

Offering solutions by converging the thoughtfully derived Intellectual Resources with the available technological resources in order to produce synergic results for the clients, at ethically justified investments and working with them continuously as intellectual partners, in progress.

Explanation for the Mission Statement Converging represents the right blend of ideas and technology. Synergic Results represents, producing outputs that are excellent in nature with high productivity orientation. Ethically Justified represents, maintaining ethical standards in pricing, quality, support any other relationship terms. Continuously in progress represents, l continuously working with clients to make sure that the investment made by them is justified and ensuring productivity.

Their Commitment Every member of Winways will constantly work for emotional and rational satisfaction of their clients, team members, share holders, business associates, facilitators and any other form of relationship with the true thought of sincerity. Management Philosophy The greatest asset for the organization is people. Empathy is the key thought process in personal relationships. Enrichment of human relations with positive attitudes would take care of all other aspects of the organization.

17

Quality Policy They are committed to deliver quality products and services, on time and within justified investments of the clients. They shall always give topmost priority to the expectations and rights of the client in every business transaction. They shall put committed efforts to offer not just service but overwhelming service in terms of quality, performance, delivery schedule and value for money. Their satisfaction is to make the client feel proud in ownership of Winways products and services and Winways becomes their undisputed Choice for repeat business. They shall continuously concentrate on improving their quality standards and productivity. They shall achieve the reputation for quality by means of integrity, honesty, self-respect, courtesy, transparency and empathy towards customers, suppliers, employees, investors competitors and any others concerned.

Message of Logo

The name Winways suggests that the entire organizational system is thinking, acting and living with Positive Attitude in all aspects. Positive Attitude is nothing but Winning Ways. The Sun Flower represents the Flexibility Nature of the management system to adopt to the changing trends and conditions. The Blossoming Position of the Sun Flower represents the Ever fresh Visionary Thoughts for an upwards growth. The two Upper Petals represent the Quality and Innovation, the core ingredients in all their solutions. The two Lower Petals represent Customer Confidence and Investor confidence, which are the lifelines of the organization.
18

The Red Head on the alphabet I represents the Positively Synergic and Ethically Principled mindset of every individual who builds the organization.

Software Industries Development Association [SIDA] Profile It is obvious that in the IT success story of Tamilnadu, Madurai and the southern districts have missed the opportunities in the past while other cities like Chennai and Coimbatore enjoyed the maximum benefits. Now, the current trend indicates a slow recovery from a global recession, which is a natural phenomenon as far as any economy, is concerned. But, IT still remains a highly potential industry, which can fuel the economy and we feel that Madurai should have its share of benefits at least now. SIDA with a vision of making this a reality would strive to create an appropriate ecosystem and convivial climate to enhance the growth of the IT sector in Madurai and the southern parts of Tamil Nadu. Vital information and growth oriented support is required for the development of IT companies in this part. A paradigm shift in the overall thought process is a must for the overall development of the industries operating in this part. SIDA would function as the resource center for the benefit of IT companies and other businesses interested to venture in IT. Presence of mega corporate establishments and major government projects are very vital for the overall development in this region. SIDA will also strive to attract big investments and also rope in IT related government initiatives to this region. As far as the student outputs are concerned, it is well known that a majority of the outstanding employees in leading IT firms in Chennai and Bangalore are products of higher educational institutions in southern Tamil Nadu. The so called, `creamy layer of students aim at finding jobs in bigger cities, where the opportunities are more. Another category of students have sound technical knowledge but lacking in their attitudinal skills to fit into a dynamic environment. SIDA will aim at bridging the gap between these categories of students. Efforts will be taken for creating suitable career opportunities for the brilliant students and at the same time we also work towards creating career development opportunities for the other category.

19

In recent times, the concepts of information Technology are often misused by criminals. Criminals are cheating entrepreneurs through many schemes and plans mainly in the small BPO segment. Investors are losing their hard earned money and also peace of mind. SIDA will provide right kind of expert advice on the technological ventures, investment opportunities and legal aspects to safeguard the interest of entrepreneurs and general public. SIDA will build bridge between Industry, Academy and Users to enhance the utility of IT and develop new opportunities for the benefit of all concerned. SIDA will organize conferences and exhibitions for upgrading the IT resource base of this region. SIDA will coordinate with government departments to promote the e-governance practices, which would help the general public to enable speedy and corruption free transparent transactions with government organizations.

20

NEED SCOPE OBJECTIVES & LIMITATIONS

21

NEED FOR THE STUDY

The IT sector has become one of the most significant growth catalysts for the Indian economy. But as compared to Chennai, Bangalore the growth of IT industry in Madurai is relatively low. So the study has to be conducted to identify the problems that hinder the growth of IT industry in Madurai and suggest solution to the problems.

22

SCOPE OF THE STUDY

This study helps to identify the problems in the Finance, marketing, infrastructure & connectivity, exposure, corporate social activities and management strategies faced by IT industry in Madurai This study helps in enhancing the growth of IT industry in Madurai by giving suitable suggestions to solve the existing problems in IT Industry of Madurai.

23

OBJECTIVES OF THE STUDY

1. To study the problems that hinders the growth of the IT industry in Madurai. 2. To analyze the reasons behind the problems 3. To offer suggestions to the policy makers

24

LIMITATIONS OF THE STUDY

1. The study has not considered all the functional areas 2. The study is limited to Madurai city. 3. Getting response from the respondents was time consuming.

25

REVIEW OF LITERATURE
26

CHAPTER-2 REVIEW OF LITERATURE

Prof. A.K. Sengupta, Director, Institute of development studies university of Lucknow

has stated that Small and Medium Enterprises face problems relating to project implementation, production, marketing, finance, administration etc.

Ashish Arora opines that obtaining finance is, however, a major concern for firms

developing software products. In contrast to services, a substantial investment is required to develop the product, and even more to market the product. Firms that are trying to develop software products have faced problems in getting finance, in part because the inexperience and conservatism of Indian venture capital funds. And good communication infrastructure is considered vital for the continued growth of the industry. This is most obviously the case in software service exports, and especially for offshore software development. Overall, the data communication infrastructure in India is expensive and in limited supply.

Jon Birger Skjrseth states that large revenues from extractive industries may

undermine economic, political and social development in developing countries; a problem coined as the `paradox of plenty. The problem calls for innovative rather than proactive corporate responses.

Awino Zachary Bolo states that differentiation is a business strategy where firms attempt

to gain competitive advantage by increasing the perceived value of their products or services relative to the perceived value of other firms products or services (Genessa M. Fratto et al, 2006).
27

REFERENCES:
1. Prof. A.K. Sengupta, Director, Institute of development studies university of Lucknow on June 2009, the study of the problems of sick small scale industries in Uttar Pradesh and suggested strategies for their revival, institute of development studies university of Lucknow. Website: http://planningcommission.nic.in/reports/sereport/ser/ser_ssi.pdf 2. Ashish Arora, V.S.Arunachalam, Jai Asundi, Ronald Fernandes on Feb 2000, the Indian Software Industry, Carnegie Mellon University.

Website: http://www.heinz.cmu.edu/project/india/pubs/rndmgmt.pdf

3. Jon Birger Skjrseth, Kristian Tangen, Philip Swanson, Atle Christer Christiansen, Arild Moe, and Leiv Lunde on July 2004, Limits to Corporate Social Responsibility, Fridtjof Nansen Institute, Lysaker Norway.

Website: http://www.fni.no/doc&pdf/FNI-R0704.pdf

4. Awino Zachary Bolo, PhD., on August 2010, Challenges facing the implementation of differentiation strategy at the mumias sugar company Limited, University of Nairobi, Kenya.

Website: http://www.aibuma.org/proceedings/downloads/Awino1,%20Kenya.pdf

28

RESEARCH METHODOLOGY
29

CHAPTER-3 RESEARCH METHODOLOGY

Introduction Research refers to the search for knowledge. It can also be defined according to Clifford woody research companies of defining and redefining problems formulating hypothesis or suggesting data making deduction and reaching conclusions and at last carefully testing the conclusions to determine whether they fit the formulating hypothesis. Research methodology is a way to systematically solve the research problem. It may too systematically as a science of studying how a research is done scientifically. In it we study the various steps that are generally adopted by researcher in studying his research problem along with the logic behind them Research Design The formidable problem that follows the task of defining the research problem is the preparation of design of the research project, popularly known as Research Design. Decisions regarding what, where, how much, by what means concerning an inquiry or a research study constitute a research design. A research design is the arrangement of conditions for collection and analysis of data in a manner that aims to combine relevance to the research purpose with economy in procedure. Type of Research Type of research used in the study is Descriptive research. All items in any field of inquiry constitute a universe or population. A complete enumeration of all items in the population is known as census inquiry. It can be presumed that in such an

30

inquiry, when all items are covered, no element of chance is left and highest accuracy is obtained. The Universe From a statistical point of view, the term Universe refers to the total of the items or units in any field of inquiry. The Universe can be finite or infinite. This study covers the finite Universe of IT Companies in Madurai as 42 in number. Sampling design A sample design is a definite plan for obtaining a sample from a sampling frame. It refers to the technique or the procedure the researcher would adopt in selecting some sampling units from which inferences about the population is drawn. Type of sampling technique used Sampling technique used here is census survey. Data collection Sources of Data Primary Data Secondary Data

Primary Data The Data observed or collected directly from first-hand experience. The primary data was collected by interviewing a cross section of 42 IT companies in Madurai with the help of standard and detailed questionnaire.

31

Secondary Data Data for the study was collected through Company websites, previous projects and other websites.

STATISTICAL TOOLS Statistics is the science of the collection, organization, and interpretation of data. It deals with all aspects of this, including the planning of data collection in terms of the design of surveys and experiments. The study involves the following statistical tools for analyzing the research data: PERCENTAGE ANALYSIS It is the method to representative raw streams of data as a % for better understanding of collected data. Percentage of respondents = No of respondents Total no of respondents WEIGHTED AVERAGE The term weight stands for relative importance of different items. Weights have been assigned to various ranks. Formula X= XW/ W Where X is weighted arithmetic mean X and W is weight attached to the variable value. 100

32

CHI-SQUARE It is a quantitative measure used to determine whether a relationship exists between two categorical variables. Formula 2 = (O-E) 2/ E Where 2
is

the Chi-square statistics, O is the observed frequency and E is the expected

frequency. Where E = Row total * Column total / No of observations TWO WAY ANOVA This technique is used when the data are classified on the basis ofwo factors. Formula Correction Factor = (T) 2 n Total SS= Xij2 - (T) 2 n SS Between Columns treatment = (Square of total of each column/ no. of items in that column)(T) 2

n SS Between Rows treatment = (Square of total of each row/ no. of items in that row)- (T) 2 n

33

SS residual (or) error = Total SS (SS between columns + SS between rows) Degrees of freedom for total variance = (c.r-1) Degrees of freedom for variance between columns = (c-1) Degrees of freedom for variance between rows = (r-1) Degrees of freedom for residual variance = (c-1) (r-1) Where c = no. of columns r = no. of rows

34

ANALYSIS AND INTERPRETATION

35

CHAPTER-4 DATA ANALYSIS AND INTERPRETATION INTRODUCTION:

A study on problems faced by IT Industry in Madurai. The main focus of the study is to identify problems prevailing in IT industry that hinders its growth and solve them by using relevant tools.

PERCENTAGE ANALYSIS
It is the method to representative raw streams of data as a % for better understanding of collected data. Percentage of respondents = No of respondents
Total no of respondents

100

TABLE 1 Gender Wise Classification of the Respondents

GENDER MALE FEMALE Total FREQUENCY 41 1 42 PERCENTAGE 97.6 2.4 100

Inference:
From the above table it is inferred that out of 42 respondents, 97.6 % of the respondents are Male and 2.4% of the respondents are Female. It indicates that most of the owner-managers of the IT companies in Madurai are Male.
36

CHART 1

Gender Wise Classification of the Respondents

37

TABLE 2

Reason for Choosing IT Field

REASON FOR CHOOSING IT FIELD CHALLENGING BASED ON QUALIFICATION PASSION MORE PROSPECTS OTHERS Total FREQUENCY PERCENTAGE

10 11

23.8 26.2

12 6 3 42

28.6 14.3 7.1 100

Inference:
From the above table it is inferred that out of 42 concerns, 23.8% of the concerns chose the IT field due to challenges, 26.2% of the concerns chose the IT field based on qualification, 28.6% of the concerns chose the IT field based on passion, 14.3% of the concerns chose the IT field based on more prospects and 7.1% of the concerns chose the IT field based on other reasons.

It shows that most of the owner-managers of the IT companies chose the IT field for passion.

38

CHART 2 Reason for Choosing IT Field

39

TABLE 3 Reason for Choosing Madurai for Setting IT Business

REASON FOR CHOOSING Madurai AVAILABILITY OF LABOR GORVERNMENT ECONOMIC INCENTIVES TAXES REGULATIONS NATIVITY Total FREQUENCY PERCENTAGE

14.2

2.4

1 34 42

2.4 81 100

Inference:
From the above table it is inferred that out of 42 concerns, 14.2% of the concerns chose Madurai city due to availability of labor, 2.4% of the concerns chose Madurai city due to government economic incentives, 2.4% of the concerns chose Madurai city due to regulations, 81% of the concerns chose Madurai city due to nativity. It exhibits that most of the owner-managers chose Madurai for setting their IT business due to nativity.

40

CHART 3 Reason for Choosing Madurai for Setting IT Business

41

TABLE 4

Level of Importance for Innovation

IMPORTANCE FOR INNOVATION NOT AT ALL IMPORTANT NOT VERY MUCH IMPORTANT NEUTRAL SOMEWAHAT IMPORTANT VERY MUCH IMPORTANT Total FREQUENCY PERCENTAGE

7.143

5 15

11.905 35.714

19

45.238

42

100

Inference:
From the above table it is inferred that out of 42 concerns, 7.143% of the concerns not at all give importance for innovation, 11.905% of the concerns neutrally give importance for innovation, 35.714% of the concerns somewhat give importance for innovation, 45.238% of the concerns very much give importance for innovation.

It specifies that most of the concerns give very much importance for innovation.

42

CHART 4 Level of Importance for Innovation

43

TABLE 5 Proficiency of Project Planning and Fund Requirement Analysis

PROJECT PLANNING AND FUND REQUIREMENT ANALYSIS VERY DIFFICULT DIFFICULT MODERATE EASY VERY EASY Total FREQUENCY PERCENTAGE

3 22 16 1 42

7.1 52.4 38.1 2.4 100

Inference:

From the above table it is inferred that out of 42 concerns, 7.1% of the concerns feel very difficult for project planning and fund requirement analysis, 52.4% of the concerns feel difficult for project planning and fund requirement analysis, 38.1% of the concerns feel moderate for project planning and fund requirement analysis and 2.4% of the concerns feel easy for project planning and fund requirement analysis.

It renders that most of the concerns feel difficult for project planning and fund requirement analysis.

44

CHART 5

Proficiency of Project Planning and Fund Requirement Analysis

45

TABLE 6 Difficulties Faced by the Concerns When Starting the Business

DIFFICULTIES FACED FOR STARTING BUSINESS LACK OF FINANCING INEFFECTIVE CASH MANAGEMENT INEFFECTIVE BUDGET PREPARATION INEFFECTIVE STRATEGY LACK OF GUIDANCE FOR FINANCIAL AID Total FREQUENCY PERCENTAGE

20

47.62

7.14

4.76

21.43

19.05

42

100

Inference:
From the above table it is inferred that out of 42 concerns, 47.62% of the concerns Faced difficulties due to lack of financing while starting the concern, 7.14% of the concerns Faced difficulties due to ineffective cash management while starting the concern, 4.76% of the concerns Faced difficulties due to ineffective budget preparation while starting the concern, 21.43% of the concerns Faced difficulties due to ineffective strategy while starting the concern and 19.05% of the concerns Faced difficulties due to lack of guidance for financial aid while starting the concern. It expresses that most of the concerns feel difficult due to lack of financing while starting the concern.

46

CHART 6

Difficulties Faced by the Concerns When Starting the Business

47

TABLE 7

Type of Finance the Concerns Received from the Initial Stage

TYPE OF FINANCE RECEIVED PROPRIETORS OWN FUND FUNDS FROM PARTNERS FUNDS FROM GOVERNMENT VENTURE CAPITALIST ANGEL INVESTORS Total FREQUENCY PERCENTAGE

33

78.57

16.67

4.76

42

100

Inference:
From the above table it is inferred that out of 42 concerns, 78.57% of the concerns made avail of proprietors own fund, 16.67% of the concerns received funds from partners and 4.76% of the concerns received funds from venture capitalists.

It points that most of the concerns made avail of proprietors own fund.

48

CHART 7 Type of Finance the Concerns Received from the Initial Stage

49

TABLE 8 Requirement of Funds in Next 3 to 5 Years

REQUIREMENT NOT NEED ANY FINANCE NEED FINANCE FROM BANKS NEED FINANCE FROM PRIVATE INSTITUTIONS NEED FINANCE FROM PARTNERS OTHERS Total FREQUENCY 2 PERCENTAGE 4.76

19

45.24

16

38.1

5 42

11.9 100

Inference:
From the above table it is inferred that out of 42 concerns, 4.76% of the concerns not need any finance, 45.24% of the concerns need finance from banks, 38.1% of the concerns need finance from other financial institutions and 11.9% of the concerns need finance from others. This indicates that most of the concerns need finance from banks.

50

CHART 8 Requirement of Funds in Next 3 to 5 Years

51

TABLE 9 Accessibility of Funds from External Sources

ACCESSIBILITY OF FUNDS FROM EXTERNAL SOURCES VERY DIFFICULT DIFFICULT MODERATE EASY VERY EASY Total FREQUENCY PERCENTAGE

12 21 8 1 42

28.6 50 19 2.4 100

Inference:
From the above table it is inferred that out of 42 concerns, 28.6% of the concerns feel accessing funds from external sources is very difficult, 50% of the concerns feel accessing funds from external sources is difficult, 19% of the concerns feel accessing funds from external sources is moderate and 2.4% of the concerns feel accessing funds from external sources is very easy. It shows that most of the concerns feel accessing funds from external sources is difficult.

52

CHART 9

Accessibility of Funds from External Sources

53

TABLE 10 Procedure for Accessibility of Funds from External Sources

PROCEDURE ACCESSIBILITY OF FUNDS FROM EXTERNAL SOURCES VERY DIFFICULT DIFFICULT MODERATE EASY VERY EASY Total

FREQUENCY

PERCENTAGE

12 26 4 42

28.6 62 9.5 100

Inference:
From the above table it is inferred that out of 42 concerns, 28.6% of the concerns feel the procedure for accessing funds from external sources is very difficult, 62% of the concerns feel the procedure for accessing funds from external sources is difficult and 9.5% of the concerns feel the procedure for accessing funds from external sources is moderate. It exhibits that most of the concerns feel that the procedure for accessing funds from external sources is difficult.

54

CHART 10 Procedure for Accessibility of Funds from External Sources

55

TABLE 11 Proficiency of the Professional Marketing Concepts and Right Application of Them to Products and Services
PARTICULARS VERY DIFFICULT TO HANDLE HAVE AN IDEA BUT OFTEN STRUGGLE CAN MANAGE BUT NOT COMFORTABLE COMFORTABLE VERY MUCH COMFORTABLE Total FREQUENCY 2 PERCENTAGE 4.8

9.5

13

31

20 3

47.6 7.1

42

100

Inference:
From the above table it is inferred that out of 42 concerns, 4.8% of the concerns feel the professional marketing concepts and right application of them for the concerns products and services are very difficult to handle, 9.5% of the concerns feel the professional marketing concepts and right application of them for the concerns products and services are having an idea but often struggle, 31% of the concerns feel the professional marketing concepts and right application of them for the concerns products and services can manage but not comfortable, 47.6% of the concerns feel the professional marketing concepts and right application of them for the concerns products and services are comfortable and 7.1% of the concerns feel the professional marketing concepts and right application of them for the concerns products and services are very much comfortable. It specifies that most of the concerns feel the professional marketing concepts and right application of them for the concerns products and services are comfortable

56

CHART 11

Proficiency of the Professional Marketing Concepts and Right Application of Them to Products and Services

57

TABLE 12 Positioning of Brand Name of Product or Service

PARTICULARS VALUE FOR MONEY SUPERIOR QUALITY CONSISTENCY TIMELINESS OTHERS Total FREQUENCY 11 20 5 5 1 42 PERCENTAGE 26 47.6 12 12 2.4 100

Inference:
From the above table it is inferred that out of 42 concerns, 26% of the concerns position their brand name of the product or service by value of money, 47.6% of the concerns position their brand name of the product or service by superior quality, 12% of the concerns position their brand name of the product or service by consistency, 12% of the concerns position their brand name of the product or service by timeliness and 2.4% of the concerns position their brand name of the product or service by other reasons.

It renders that most of the concerns position their brand name of the product or service by superior quality.

58

CHART 12 Positioning of Brand Name of Product or Service

59

TABLE 13 Reasons for Loyalty of Customers to the Products or Services

PARTICULARS QUALITY TIMELINESS SUPPORT & SERVICE PRICE OTHERS Total FREQUENCY 25 13 4 42 PERCENTAGE 59.5 31 9.5 100

Inference:
From the above table it is inferred that out of 42 concerns, 59.5% of the concerns have loyal customers because of quality, 31% of the concerns have loyal customers because of support and service and 9.5% of the concerns have loyal customers because of price. It expresses that most of the concerns have loyal customers due to quality in their products or services.

60

CHART 13 Reasons for Loyalty of Customers to the Products or Services

61

TABLE 14 Pre-launching Survey

PARTICULARS YES NO Total FREQUENCY 11 31 42 PERCENTAGE 26.19 73.81 100

Inference:
From the above table it is inferred that out of 42 concerns, 26.19 % of the concerns have conducted pre-launching surveys and 73.81% of the concerns havent conducted pre-launching surveys. It points out that most of the concerns havent conducted pre-launching surveys for their products.

62

CHART 14 Pre-launching Survey

63

TABLE 15 Marketing Problem

PARTICULARS YES NO Total FREQUENCY 7 35 42 PERCENTAGE 16.67 83.33 100

Inference:
From the above table it is inferred that out of 42 concerns, 16.67 % of the concerns have marketing problems and 83.33% of the concerns doesnt have marketing problems.

It indicates that most of the concerns have marketing problems.

64

CHART 15

Marketing Problem

65

TABLE 16 Opinion towards Exposure

PARTICULARS YES NO Total FREQUENCY 39 3 42 PERCENTAGE 92.9 7.1 100

Inference:
From the above table it is inferred that out of 42 concerns, 92.9 % of the concerns that feel being in Madurai is less exposure and 7.1% of the concerns that doesnt feel being in Madurai is less exposure. It shows that most of the concerns feel that being in Madurai is less exposure.

66

CHART 16 Opinion towards Exposure

67

TABLE 17 Initiative to Travel

PARTICULARS YES NO Total FREQUENCY 42 42 PERCENTAGE 100 100

Inference:
From the above table it is inferred that out of 42 concerns, 100 % of the concerns that take initiative to travel for updating their knowledge. It exhibits that almost all of the concerns owner-managers take initiative to update their knowledge.

68

CHART 17 Initiative to Travel

69

TABLE 18 Preferences of Seminars that the Concerns Need to be Availed

PARTICULARS TECHNOLOGIACAL SEMINARS FINANCE & OPERATIONS SEMINAR BUSINESS DEVELOPMENT SEMINARS MARKETING RELATED SEMINARS OTHERS Total FREQUENCY 17 PERCENTAGE 40.4

21.4

12

11

26.2

42

100

Inference:
From the above table it is inferred that out of 42 concerns, 40.4% of the concerns prefer to attend technological seminars, 21.4% of the concerns prefer to attend finance and operations seminars, 12% of the concerns prefer to attend business development related seminars and 26.2% of the concerns prefer to attend marketing related seminars. It specifies that most of the concerns prefer to attend technological seminars.

70

CHART 18 Preferences of Seminars that the Concerns Need to be Availed

71

TABLE 19 Frequency of Travel to Other Cities

PARTICULARS ONCE IN A YEAR TWICE IN A YEAR ONCE IN SIX MONTHS ONCE IN A MONTH WHENEVER NEEDED Total FREQUENCY 9 13 7 PERCENTAGE 21.4 31 16.7

10 3 42

23.8 7.1 100

Inference:
From the above table it is inferred that out of 42 concerns, 21.4% of the owner-managers travel once in a year for updating their knowledge, 31% of the owner-managers travel twice in a year for updating their knowledge, 16.7% of the owner-managers travel once in a month for updating their knowledge, 23.8% of the owner-managers travel twice in 6 months for updating their knowledge and 7.1% of the owner-managers travel whenever needed for updating their knowledge. It renders that most of the owner-managers travel twice in 6 months for updating their knowledge.

72

CHART 19 Frequency of Travel to Other Cities

73

TABLE 20 Brand of Computer Systems Used by the Concerns

PARTICULARS HCL LENOVO HP DELL OTHERS Total FREQUENCY 9 3 9 6 15 42 PERCENTAGE 21.43 7.14 21.43 14.3 35.7 100

Inference:
From the above table it is inferred that out of 42 concerns, 21.43% of the concerns use HCL brand of computer systems, 7.14% of the concerns use Lenovo brand of computer systems, 21.43% of the concerns use HP brand of computer systems, 14.3% of the concerns use Dell brand of computer systems and35.7% of the concerns use other brand of computer systems.

It expresses that most of the concerns use other brand of computer systems.

74

CHART 20 Brand of Computer Systems Used by the Concerns

75

TABLE 21 Speed of the Broadband Service

PARTICULARS 1 Mbps 2 Mbps 3 Mbps 4 Mbps OTHERS Total FREQUENCY 4 35 1 1 1 42 PERCENTAGE 9.5 83.3 2.4 2.4 2.4 100

Inference:
From the above table it is inferred that out of 42 concerns, 9.5% of the concerns use 1 Mbps speed of broadband service, 83.3% of the concerns use 2 Mbps speed of broadband service, 2.4% of the concerns use 3 Mbps speed of broadband service, 2.4% of the concerns use 4 Mbps speed of broadband service and 2.4% of the concerns use other frequency of the speeds of broadband service.

It points that most of the concerns use 2 Mbps speed of broadband service.

76

CHART 21 Speed of the Broadband Service

77

TABLE 22 Provision of Same Speed

PARTICULARS YES NO Total FREQUENCY 4 38 42 PERCENTAGE 9.5 90.5 100

Inference:
From the above table it is inferred that out of 42 concerns, 9.5 % of the concerns that feel broadband service providers provide same speed all the time and 90.5% of the concerns that feel broadband service providers doesnt provide same speed all the time. It indicates that most of the concerns broadband service providers dont provide same speed all the time.

78

CHART 22 Provision of Same Speed

79

TABLE 23 Variation of Speed Provided by the Broadband Service

PARTICULARS ALWAYS FREQUENTLY SOMETIMES MODERATE NEVER Total FREQUENCY 1 18 16 3 1 39 PERCENTAGE 2.6 46.1 41 7.7 2.6 100

Inference:

From the above table it is inferred that out of 42 concerns, 2.6% of the concerns feel that always the speed of the broadband service varies, 46.1% of the concerns feel that frequently the speed of the broadband service varies, 41% of the concerns feel that sometimes the speed of the broadband service varies, 7.7% of the concerns feel that moderately the speed of the broadband service varies and 2.6% of the concerns feel that the speed of the broadband service never varies. It shows that most of the concerns feel that frequently the speed of the broadband service varies.

80

CHART 23 Variation of Speed Provided by the Broadband Service

81

TABLE 24 Frequency of Changes in the Software used

PARTICULARS EVERY MONTH ONCE IN 6 MONTHS ONCE IN AYEAR AFTER 5 YEARS ACCORDING TO THE TYPE OF REQUIREMENT Total FREQUENCY 1 1 2 2 36 PERCENTAGE 2.4 2.4 4.8 4.7 85.7

42

100

Inference:
From the above table it is inferred that out of 42 concerns, 2.4% of the concerns change their software every month, 2.4% of the concerns change their software once in 6 months, 4.8% of the concerns change their software once in a year, 4.7% of the concerns change their software after 5 years and 85.7% of the concerns change their software according to the type of requirement.

It exhibits that most of the concerns change their software according to the type of requirement.

82

CHART 24 Frequency of Changes in the Software used

83

TABLE 25 Level of Open Source Adoption

PARTICULARS VERY HIGH HIGH MODERATE LOW VERY LOW Total FREQUENCY 7 8 9 11 7 42 PERCENTAGE 16.7 19 21.4 26.2 16.7 100

Inference:
From the above table it is inferred that out of 42 concerns, 16.7% of the concerns level of open source adoption is very high, 19% of the concerns level of open source adoption is high, 21.4% of the concerns level of open source adoption is moderate, 26.7% of the concerns level of open source adoption is low and 16.7% of the concerns level of open source adoption is very low.

It specifies that most of the concerns level of open source adoption is low.

84

CHART 25 Level of Open Source Adoption

85

TABLE 26 Frequency of Servicing the Computer Systems

PARTICULARS EVERY MONTH ONCE IN 6 MONTHS ONCE IN A YEAR EVRY 5 YEARS ONCE NEVER Total FREQUENCY 7 25 9 1 42 PERCENTAGE 16.7 59.5 21.4 2.4 100

Inference:
From the above table it is inferred that out of 42 concerns, 16.7% of the concerns service their systems every month, 59.5% of the concerns service their systems once in 6 months, 21.4% of the concerns service their systems once in a year and 2.4% of the concerns never service their systems.

It renders that most of the concerns service their systems once in 6 months.

86

CHART 26 Frequency of Servicing the Computer Systems

87

TABLE 27 Concerns Point of View about the CSR Activities

PARTICULARS SOLIDARITY MARKETING STRATEGY HIRING AND RETAINING EMPLOYEES CREATING BRAND IMAGE OTHERS Total FREQUENCY 25 7 PERCENTAGE 59.52 16.7

7.14

9.5

3 42

7.14 100

Inference:
From the above table it is inferred that out of 42 concerns, 59.52% of the concerns point of view about CSR activity is solidarity, 16.7% of the concerns point of view about CSR activity is marketing strategy, 7.14% of the concerns point of view about CSR activity is hiring and retaining the employees, 9.5% of the concerns point of view about CSR activity is creating brand image and 7.14% of the concerns point of view about CSR activity is others.

It expresses that most of the concerns point of view about CSR activity is solidarity.

88

CHART 27 Concerns Point of View about the CSR Activities

89

TABLE 28 Concerns Engaging in the CSR Activities

PARTICULARS EDUCATION HEALTH COMMUNITY DEVELOPMENT ENVIRONMRNTAL PRESERVATION OTHERS Total FREQUENCY 11 4 24 PERCENTAGE 26.2 9.52 57.14

7.14

42

100

Inference:
From the above table it is inferred that out of 42 concerns, 26.2% of the concerns engage in education, 9.52% of the concerns engage in health, 57.14% of the concerns engage in community development and 7.14% of the concerns engage in environmental preservation.

It points that most of the concerns engage in community development.

90

CHART 28 Concerns Engaging in the CSR Activities

91

TABLE 29 Concerns that Face Problems in Engaging CSR Activities

PARTICULARS YES NO Total FREQUENCY 3 39 42 PERCENTAGE 7.1 92.9 100

Inference:
From the above table it is inferred that out of 42 concerns, 7.1 % of the concerns have any problems in engaging CSR activities and 92.90 % of the concerns dont have any problems in engaging CSR activities. It indicates that most of the concerns dont have any problems in engaging CSR activities.

92

CHART 29 Concerns that Face Problems in Engaging CSR Activities

93

Chi Square Analysis:

It is a quantitative measure used to determine whether a relationship exists between two categorical variables.

Formula: 2 = (O-E) 2/ E Where 2

is

the Chi-square statistics, O is the observed frequency and E is the expected

frequency. Where E = Row total * Column total / No of observations

HYPOTHESIS:

NULL HYPOTHESIS (H0):

There is no significant relationship between the type of ownership of the concern and the type of financial arrangements made avail by the concern.

ALTERNATIVE HYPOTHESIS (H1):

There is significant relationship between the type of ownership of the concern and the type of financial arrangements made avail by the concern.

94

TABLE 30 2 Test- Type of Ownership of the Concern and the Type of Financial Arrangements Made Availed
FINANCIA L ARRANGE MENTS MADE AVAIL TYPE OF OWNERSHIP OF THE CONCERN LOANS FROM COMMERCIAL BANKS LOANS FROM GOVERNMENT AGENCIES LOANS FROM PRIVATE FINANCIAL INSTITUTION S CREDIT CARDS OTHER S TOTAL

SOLE PROPRIETORY PARTNERSHIP PRIVATE LTD PUBLIC LTD OTHERS

TOTAL

1 4 0 0

0 2 0 0

0 23 0 0

0 2 0 0

2 4 0 0

3 35 0 0

25

42

95

OBSERVED

EXPECTED (OE) ( O E )2 ( O E )2 / E

FREQUENCY FREQUENCY (O) (E)

2 1 1 1 2 4 2 23 2 4

2.38 0.29 0.67 0.36 0.50 4.17 1.67 20.83 2.5 5.83

-0.38 0.71 0.33 0.64 1.5 -0.17 0.33 2.17 -0.5 -1.83

0.1444 0.5041 0.1089 0.4096 2.25 0.03 0.11 4.71 0.25 3.35

0.061 1.738 0.163 1.138 4.500 0.001 0.100 0.230 0.100 0.600

TOTAL

8.631

Calculated Value: 2 = (O-E) 2/ E

2= (O E) 2 / E = 8.631

96

Degree of freedom: (r-1) (c-1) = (5-1) (5-1) =4*4 = 16

Table value at 5% significance = 26.296

Inference:

Since the calculated value is less than the table value. That is 8.631is less than 26.296. So, Null hypothesis is accepted. So, there is no significant relationship between the type of ownership of the concern and the type of financial arrangements made avail by the concern.

97

Chi Square Analysis:

HYPOTHESIS:

NULL HYPOTHESIS (H0):

There is no significant relationship between the current phase of the concern and the mode of marketing of the concern.

ALTERNATIVE HYPOTHESIS (H1):

There is significant relationship between the current phase of the concern and the mode of marketing of the concern

98

TABLE 31 2 Test- Current Phase of Marketing and Mode of Marketing

CURREN T MARKET ING PHASE

INTRODUCT ION STAGE

GROWTH

MATURITY

SATURA TION

DECLI NE

TOTA L

MODE OF MARKETING ADVERTISING PUBLIC RELATIONS SALES PROMOTIONS DIRECT MARKETING ONLINE MARKETING TOTAL
0 1 0 10 7 5 0 0 0 0 0 0 0 0 0 10 8 5

13

14

38

42

99

OBSERVED

EXPECTED (OE) ( O E )2 ( O E )2 / E

FREQUENCY FREQUENCY

(O)

(E)

10 1 7 5 1 3 1 1 13

9.05 0.60 7.24 4.524 0.36 4.524 0.12 1.00 12.67

0.95 0.4 -0.24 0.476 0.64 -1.524 0.88 0.33

0.9025 0.16 0.06 0.227 0.41 2.323 0.8 0.1089

0.1 1.27 0.01 0.05 1.14 0.513 6.5 0.01

TOTAL

8.6

100

Calculated Value:
2 = (O-E) 2/ E

2= (O E) 2 / E = 8.6

Degree of freedom:

(r-1) (c-1) = (5-1) (5-1)

=4*4 = 16

Table value at 5% significance = 26.296

Inference:

Since the calculated value is less than the table value. That is 8.6 is less than 26.296. So, Null hypothesis is accepted. So, there is no significant relationship between the current phase of the concern and the mode of marketing of the concern.

101

TABLE 32 Percentage Analysis- Preference of Broadband Service Provider for its Features
PARTICULARS CONNECTIVITY BRAND NAME PRICE SECURITY OTHERS Total FREQUENCY 33 5 2 2 42 PERCENTAGE 78.5 11.9 4.8 4.8 100

Inference:
From the above table it is inferred that out of 42 concerns, 78.5% of the concerns prefer their broadband service provider due to connectivity, 11.9% of the concerns prefer their broadband service provider due to brand name, 4.8% of the concerns prefer their broadband service provider due to security and 4.8% of the concerns prefer their broadband service provider due to other reasons. It exhibits that most of the owner-managers prefer their broadband service provider due to connectivity.

102

TWO WAY ANOVA: HYPOTHESIS: NULL HYPOTHESIS (H0):

There is no significant relationship between the preference of broadband service and the level of satisfaction of services provided by the broadband service provider.

ALTERNATIVE HYPOTHESIS (H1):

There is significant relationship between the preference of broadband service and the level of satisfaction of services provided by the broadband service provider.

TABLE 33 TWO WAY ANOVA- Preference and Level of Satisfaction of Services on Broadband Service
Broadband Service Provider Satisfaction Level Airtel BSNL Reliance Tata Indicom Other Service Providers Total

Highly Dissatisfied Dissatisfied Neutral Satisfied Highly Satisfied Total

17

29

0 0 0 0 0

9 0 0 0 26

1 2 0 0 10

1 0 0 0 6

0 0 0 0 0

11 2 0 0 42

103

Step 1: T=42, n= 25, Correction Factor = ((T^2)/n) = (42^2)/25=70.56 Step 2: Total SS= 0+289+49+25+0+841+0+81+1+1+0+121+0+0+4+0+0+4+676+100+36(70.56) = 2157.44 Step3: SS between Columns treatment = [02/5 + 262/5 + 102/5 + 62/5+ 02/5] - 70.56 = [676/5 +100/5 + 36/5] - 70.56 = 91.84 Step 4: SS between rows treatment = [292/5 +112/5+ 22/5] - 70.56 = 122.64 Step 5: SS Residual (or) error = Total SS (SS between Columns treatment + SS between Rows treatment) = 2157.44 (91.84 + 122.64) =1942.96

104

ANOVA TABLE

SOURCES OF VARIATIO N BETWEEN COLUMNS

SUM OF SQUARE S SS 91.84

DEGREE OF FREEDOM d.f (c-1)=(5-1) =4

MEAN SQUARE MS

F-Ratio

5% F limit (or the table values)

91.84/4= 22.96

22.96/121.435 = 0.189

(4,16)=3.01

BETWEEN ROWS

122.64

(r-1)=(5-1) =4

122.64/4= 30.66

30.66/121.435 = 0.2525

(4,6)=3.01

RESIDUAL (or) ERROR TOTAL

1942.96

(c-1)(r-1) =(4)(4)=16

1942.96/16= 121.435

2157.44

(5*5)-1=24

Inference:
The calculated value between columns (0.189) and between rows (0.2525) is lesser than the Flimit table value at 5 % significant level (3.01). So, the null hypothesis is accepted (i.e.) there is no significant relationship between the preference of broadband service and the level of satisfaction of services provided by the broadband service provider.

105

TABLE 34 Weighted Average Level of Importance towards the CSR Activities

PARTICULAR VERY IMPORTANT IMPORTAN T MODERATE NOT VERY IMPORTANT NOT AT ALL IMPORTANT MEA N SCO RE RA NK

WX

W X 8

WX

WX

WX

DEVELOPMENT OF SOCIETY GAINING CUSTOMER ATTENTION

11

55

4.9

II

15

75

14

5.9

TO GAIN GOVERNMENT ATTENTION

0.13

III

DEVELOPMENT OF BUSINESS

OTHERS

Inference:
The concerns give importance to CSR activities firstly for gaining customer attention, the concerns give importance to CSR activities secondly for the development of the society and the concerns give importance to CSR activities thirdly for gaining government attention.

106

TABLE 35 Weighted Average Level of Proficiency towards the Management Strategies

PARTICULARS DIFFICULT TO HANDLE X VISION,MISSION, POSITIONING , CORE PRINCIPLES GOAL SETTING SWOT ANALYSIS 1 0 5 5 5 0 1 2 4 4 4 8 4 2 3 3 12 6 27 0 2 2 54 0 9 29 1 1 9 29 5.6 2.9 V VI 0 W 5 WX 0 SOMEWHAT DIFFICULT X 2 W 4 WX 8 OFTEN STRUGGLE X 7 W 3 WX 21 NOT COMFORTABLE X 24 W 2 WX 48 COMFORTABLE MEAN SCORE RANK

X 9

W 1

WX 9 5.7 IV

IMPLEMENTATI ON, MONITORING AND CORRECTION OF STRATEGIC PLAN TRENDS/CLIMAT E ANALYSIS MATCHING RESOURCES FOR STRATEGIC/ BUSINESS PLAN

27

23

46

III

12

12

36

21

42

6.4

18

27

54

6.1

II

Inference:
The concerns level of proficiency towards trends/ climate analysis stands first, the concerns level of proficiency towards matching resources for strategic/ business plan stands second and the concerns level of proficiency towards implementation, monitoring and correction of strategic plan stands third.

107

TABLE 36 Weighted Average Level of Satisfaction towards the Management Skills

PARTICULAR S HIGHLY SATISFIED X HANDLING MEETING PLANNING ORGANIZING SCHEDULING DELEGATING REPORTING PROJECT HANDLING NETWORKING 9 W 5 WX 45 SATISFIED NEUTRAL DISSATISFIED HIGHLY DISSATISFIED X 0 W 1 WX 0 11.4 IV MEAN SCORE RAN K

X 29

W 4

WX 116

X 2

W 3

WX 6

X 2

W 2

WX 4

18 18 15 11 5 8

5 5 5 5 5 5

90 90 75 55 25 40

21 22 21 15 15 26

4 4 4 4 4 4

84 88 84 60 60 104

2 2 4 15 20 8

3 3 3 3 3 3

6 6 12 45 60 24

1 0 2 0 2 0

2 2 2 2 2 2

1 0 4 0 4 0

0 0 0 1 0 0

1 1 1 1 1 1

0 0 0 1 0 0

12.13 12.3 11.7 10.7 9.9 11.2

II I III VIII X V

35

25

100

27

10.9

VI

TEAM BUILDING TIME MANAGEMEN T CRISIS MANAGEMEN T

25

14

56

23

69

10

IX

35

25

100

24

10.8

VII

30

25

100

27

10.7

VIII

Inference:
The concerns level of satisfaction towards organizing skills stands first, the concerns level of satisfaction towards planning skills stands second and the concerns level of satisfaction towards scheduling skills stands third.

108

FINDINGS SUGGESTIONS AND CONCLUSION

109

CHAPTER-5
FINDINGS The research project was undertaken to study and evaluate the various problems faced by the IT industry in Madurai. The following are the findings of the study.

97.6 % of the respondents are Male 28.6% of the concerns chose the IT field based on passion 81% of the concerns chose Madurai city due to nativity 45.238% of the concerns very much give importance for innovation 38.1% of the concerns feel moderate for project planning and fund requirement
analysis

47.62% of the concerns Faced difficulties due to lack of financing while starting
the concern

78.57% of the concerns made avail of proprietors own fund 45.24% of the concerns need finance from banks 50% of the concerns feel accessing funds from external sources is difficult 62% of the concerns feel the procedure for accessing funds from external sources
is difficult 47.6% of the concerns feel the professional marketing concepts and right application of them for the concerns products and services are comfortable. 47.6% of the concerns position their brand name of the product or service by superior quality. 59.5% of the concerns have loyal customers because of quality.

73.81% of the concerns havent conducted pre-launching surveys 83.33% of the concerns doesnt have marketing problems 92.9 % of the concerns that feel being in Madurai is less exposure 100 % of the concerns that take initiative to travel for updating their knowledge 40.4% of the concerns prefer to attend technological seminars 31% of the owner-managers travel twice in a year for updating their knowledge
110

 35.7% of the concerns use other brand of computer systems. 83.3% of the concerns use 2 Mbps speed of broadband service 90.5% of the concerns that feel broadband service providers doesnt provide same speed all the time 46.1% of the concerns feel that frequently the speed of the broadband service varies 85.7% of the concerns change their software according to the type of requirement 26.7% of the concerns level of open source adoption is low. 59.5% of the concerns service their systems once in 6 months 59.52% of the concerns point of view about CSR activity is solidarity 57.14% of the concerns engage in community development. 92.90 % of the concerns dont have any problems in engaging CSR activities Null hypothesis is accepted. So, there is no significant relationship between the type of ownership of the concern and the type of financial arrangements made avail by the concern. Null hypothesis is accepted. So, there is no significant relationship between the current phase of the concern and the mode of marketing of the concern. 78.5% of the concerns prefer their broadband service provider due to connectivity Null hypothesis is accepted (i.e.) there is no significant relationship between the preference of broadband service and the level of satisfaction of services provided by the broadband service provider The concerns give importance to CSR activities firstly for gaining customer attention The concerns level of proficiency towards trends/ climate analysis stands first The concerns level of satisfaction towards organizing skills stands first

111

SUGGESTIONS

The policy makers and government should encourage women entrepreneurs to start IT companies in Madurai. The policy makers should encourage the owner-managers of the members of Software Industry Development Association for innovative products or services. Access to finance is a problem. The policy makers should approach the government agencies to address this problem together with the financial institutions. Growth of the industry generally requires resources and owner-managers need to have access to these resources in order to growth. The procedures for accessing funds from government and non-governmental financial institutions should be made easy by the government agencies so, that the software companies in Madurai can be well established as in the cities of Bangalore and Chennai. The policy makers should suggest the guidelines for accessing finance from government and non-governmental financial institutions The policy makers should arrange for marketing, finance, business development seminars to develop the knowledge of the owner-managers of the members of Software Industry Development Association. The policy makers should prompt broadband service providers for improved broadband services. The policy makers should arrange seminars related to management strategies so, that the owner-managers of the member companies of Software Industry Development Association can run their business in a better manner so, that the economic condition of Madurai will be improved. The policy makers should give awareness more about statutory issues to the ownermanagers of the members of Software Industry Development Association because many of the members of Software Industry Development Association refused to answer the questionnaire related to statutory issues.

112

CONCLUSION

The study was intended to get the responses from various IT companies and how far the problems hinder the growth of the IT industry. The study is conducted to identify the various factors that hinders the growth of IT industry in Madurai.

This study also suggest some measures to solve the problems of IT industry in Madurai such as The procedures for accessing funds from government and non-governmental financial institutions should be made easy by the government agencies so, that the software companies in Madurai can be well established as in the cities of Bangalore and Chennai. The policy makers should prompt broadband service providers for improved broadband services. These suggestions are beneficial for the policy makers to prepare better policies for the action plan to reduce the problems that hinders the growth.

113

BIBLIOGRAPHY

1. Prof. A.K. Sengupta, Director, Institute of development studies university of Lucknow on June 2009, the study of the problems of sick small scale industries in Uttar Pradesh and suggested strategies for their revival, institute of development studies university of Lucknow. Website: http://planningcommission.nic.in/reports/sereport/ser/ser_ssi.pdf 2. Ashish Arora, V.S.Arunachalam, Jai Asundi, Ronald Fernandes on Feb 2000, the Indian Software Industry, Carnegie Mellon University.

Website: http://www.heinz.cmu.edu/project/india/pubs/rndmgmt.pdf

3. Jon Birger Skjrseth, Kristian Tangen, Philip Swanson, Atle Christer Christiansen, Arild Moe, and Leiv Lunde on July 2004, Limits to Corporate Social Responsibility, Fridtjof Nansen Institute, Lysaker Norway.

Website: http://www.fni.no/doc&pdf/FNI-R0704.pdf

4. Awino Zachary Bolo, PhD., on August 2010, Challenges facing the implementation of differentiation strategy at the mumias sugar company Limited, University of Nairobi, Kenya.

Website: http://www.aibuma.org/proceedings/downloads/Awino1,%20Kenya.pdf

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APPENDIX A Study on Problems faced by IT Industry in Madurai

Questionnaire:

Name Name of the Organization Organizational Details

: :

1. When did you start your concern? 2. Why did you choose this field? a) Challenging b) based on qualification c) passion d) more prospects e)

others please specify ________________________ 3. Why did you choose this place? a) Availability of labor b) government economic incentives c) taxes d) regulations

e) others please specify _______________________ 4. How far do you give importance for innovation? a) Not at all important important b)not very much important c)neutral d)somewhat

e)very much important

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Finance

1. Project planning and fund requirement analysis is

a)

Very difficult

b) difficult

c) moderate

d) easy

e) very easy

2. What type of difficulty did you face when you started this concern? a) lack of financing b)ineffective cash management c)ineffective budget preparation d)ineffective strategy e)lack of guidance for financial aid 3. What type of ownership is your concern? a) Sole proprietary specify 4. What type of financing has your concern received from the initial stage? a) proprietors own fund b) funds from partners c) government funds d) b)Partnership c) Private Ltd d) Public Ltd e) others please

venture capitalist e)angel investors _______________________

f) others please specify

5. What type of financial arrangements do your concern made avail? a) loans from commercial banks b)loans from government agencies private financial institutions _______________ 6. During the next 3 to 5 years the concern may a) Not need any financing b) need financing from banks other private financial institutions c) need financing from c) loans from

d)credit cards e) others please specify

d) need financing from partners

e)others please specify________________________ 7. Accessing funds from external sources is: a) Very difficult b) difficult c) moderate
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d) easy

e) very easy

8. What do you feel about the procedure for accessing funds from external sources? a) Very difficult b) difficult c) moderate d) easy e) very easy

9. Do you have any other problems in acquiring funds? If yes, Please mention

10. What kind of support you expect from SIDA in this regard?

Marketing

1. What is the current marketing phase for your concern? a) Introduction stage b) growth c) maturity d) saturation e) decline 2. What is your mode of marketing? a) advertising b) public relations c) sales promotion d) direct marketing online 3. What do you feel about the professional marketing concepts and right application of them to your products/services?
a)

e)

Very difficult to handle b) have an idea but often struggle c) can manage but not comfortable d) comfortable e) very much comfortable

4. What do you feel about the analytical skills of marketing strategies, plans, innovations of competition and their impact on your products/services?

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a) Very difficult to handle b) have an idea but often struggle c) can manage but not comfortable d) comfortable e) very much comfortable 5. Have you done any pre- launching survey? a) yes b) no

6. How did you position the brand name of your product or service?
a) Value for money b) Superior quality c) Consistency d) timeliness

e)Others

please specify ________________________ 7. Why do you think these customers are loyal to your product? a) Quality b) timeliness c) support & service d) price e) others please specify________________________ 8. A) Do you have any problems in marketing your products? a) yes B) If yes, please specify the problems: a) Identifying customers b) identifying market c) inadequate funds for marketing d) inadequate marketing strategies e) others please specify____________ b) no

Exposure

1. Do you think being in Madurai have less exposure to seminars which help you in developing your business? a) yes b) no 2. If yes, for the above question specify your preference : a) Technology seminars related seminars d) b) finance & operation seminars marketing related seminars c) business development e) others please

specify________________________

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3. A) Do you take initiative to travel to other cities to update yourself? a) Yes b) no B) If yes, how often.. a) once in a year b) twice in a year c) once in a month d) twice in 6 months e)none

Infrastructure and Connectivity 1. Do you have enough number of systems in your concern? a) yes 2. How many systems do you have? a) 5-10 b) 11-20 c) 21-30 d) 31-50 e) above 50 b) no

3. What brand of systems do you have? a) HCL b) Lenovo c) Hewlett Packard d) Dell e) others please specify________________________ 4. Which of the following broadband service provider do you use?

a) Airtel

b)

BSNL

c) reliance

d) Tata indicom

e)

others please

specify________________ 5. Why do you prefer that particular broadband service provider? a) Connectivity b) brand name c) price d) security e) others please specify________________________ 6. Are you satisfied with the services of that particular service provider? If yes, please specify the degree of satisfaction: a) Highly dissatisfied b) dissatisfied c) neutral d) satisfied e) highly satisfied

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7. Please specify the speed of the broadband service you use. a) 1 Mbps b) 2 Mbps c) 3 Mbps d) 4 Mbps e) Others please

specify________________________

8.A) Does your broadband service provider provide the same speed all the time? a) yes b) no

B) If no, please specify the frequency: a) Always b) frequently it varies c) sometimes it varies d) moderate 9. How often you change your software? a) Every month b)once in six months c)once in a year d) after 5 year e) e) never

according to the type of requirements 10. A) What is the level of your Open Source adoption? a) very high b)high c) moderate d) low e) very low B) If low, give reasons 11. How often do you service your systems? a) every month e)never 12. What are the modes of transport does your resource persons use? a) car b) train c)plane d) bus e)others please specify____________ a) yes b) once in six months c) once in a year d)every 5 years once

13. Do you think these modes of transport are adequate? b) no 14. Do transportation expenses are worthwhile? a) yes b) no

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15. What are all your expectations from SIDA?

Corporate Social Responsibilities (CSR) Activities

1. What does CSR activities mean to you? a) Solidarity b) marketing strategy c) hiring and retaining employees

d) creating brand image

e) others please specify________________

2. What kind of CSR activities you engage in your concern? a) Education preservation b)health c) community development d)environment

e) others please specify_________

3. Do you think CSR activities are important? If yes, please specify the degree of importance: a) Very much important not at all important b)important c) moderate d)not very important e)

4. Why do you think CSR activities are important? a) Development of society attention b) gaining customer attention c) to gain government e) others please

d) development of the business

specify________________________ 5. A) Do you have any problems in engaging CSR activities? a) yes b) no B) If yes, please mention the problems.

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Management Strategies Please rate yourself based on your proficiency/confidence level on each of the check points given below:

a - I always find it very difficult to handle b- I always find it somewhat difficult to handle c Just have an idea but often struggle d I can reasonably manage but not comfortable e I am an expert and comfortably manage

1. What do you feel about managing to maintain the Philosophy of your business (Vision, Mission, Positioning, Core principles etc.) a) [ ] b) [ ] c) [ ] d) [ ] e) [ ]

2. What do you feel about Goal setting for your business? a) [ ] b) [ ] c) [ ] d) [ ] e) [ ] 3. What do you feel about working on a SWOT analysis for your organization? a) [ ] b) [ ] c) [ ] d) [ ] e) [ ]

4. What do you feel about the Practical implementation, monitoring and correction of strategic plan? a) [ ] b) [ ] c) [ ] d) [ ] e) [ ]

5. What is your proficiency level of Trends/Climate analysis skills? a) [ ] b) [ ] c) [ ] d) [ ] e) [ ]

6. What do feel about matching resources for Strategies/business plan? a) [ ] b) [ ] c) [ ] d) [ ] e) [ ]

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7. What do you feel about your business management skills?

Business Management Skills Handling Meeting Planning organizing scheduling delegating Reporting Project handling Networking Team building Time management Crisis management

Highly satisfied Satisfied Neutral dissatisfied

Highly Dissatisfied

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