Gross Working Capital Concept
According to this concept, working capital means gross working capital which is the total of all the current assets of a business.
Gross Working Capital= Total Current Assets
Definitions favoring this concept are-
“Working Capital means total of Current Assets.”- Mead, Mallott and Field
Persons acknowledge the total of current ass5ets as working capital gives the following arguments in their favors:
(1) Just as fixed assets are considered as the symbol of fixed capital, current assets must also be considered as symbol of working capital.
(2) Any acquisition of fund increases the working capital. This statement proves true according to this concept whereas it does not hold true according to the second concept.
(3) Most of the managers plan their business operations according to the current assets concept because these are the assets used in day-to-day business operations.
(4) Utility of current assets remains the same whether financed from long term loans or short term loans. Hence, the total amount of current assets must be treated as working capital.

Hereditary:- Hereditary refers to those factors that were determined by conception. Physical stature, facial alteration, gender temperament, energy level and biological rhythms are characteristics that are either completely or substantially influenced by parents. Evidence demonstrates that traits such as shyness, fear and distress are most likely caused by inherited genetic characteristics.

If personality characteristics were completely dictated by heredity, they would be fixed at birth and no amount of experience would alter them. If one is relaxed and easygoing as a child, for ex. that would be the result of one’s genes, and it would not be possible to change those characteristics. But personality characteristics are not completely dictated by heredity.

Environment:- Among the factors that exact pressures on our personality formation are the cultures in which we are area raised; our earlier conditioning the norms among our family, friends and social groups and other influences that we experience. These environmental factors play a substantial role in shaping our personalities. Cultural establishes the norms attributes and values that are passed along from generations to the and create consistencies of time ideology that is only moderate intensely fostered in one culture may only have emphasis in another. It can be concluded that both heredity and environment are the primary determinations of personality.

Situations:- The third factor, the situation influences the effects of heredity and environment on personality. An individual’s personality, although generally stable and consistent does change in different situations. The different demands of different situations call forth different aspects of one’s personality. So we shouldn’t look at personality patterns in isolation.

Determinations of personality that are more input than in others in shaping the personality of a manager include:-
1. Locus of control:- The degree to which people believe they masters of their own fate. Individuals who believe that they control what happens to them make more successful manager than those who believe that what happens to them is controlled by outside forces such as luck or chance.
2. Introvert and Extrovert:- Extrovert i.e. individuals who are gregarious and social are more successful as managers than Introverts i.e. individuals who are shy, quite and retiring.

Importance of marketing intermediaries:-
many producers lack the financial resources to carry out direct marketing. Ex. Maruti udyog sells its cars through more than 600 dealer outlets; even maruti udyog would be hard pressed to raise the cash to buy out its dealers.
a) Direct marketing would require many producers to become middlemen for the complimentary products of other Producers in order to achieve mass distribution economies. Ex.maruti udyog will have to become middlemen for auto ancillary companies if it establish its own distribution network.
b) producers who can afford to establish there own channels can offer earbn a grater return by increasing their investment in their main business. If a company earns a 20 percent rate of return on manufacturing and foresees only a 10 percent return on retailing. It will not want to undertake its own retailing.
c) Marketing intermediaries through their own contacts, experience, specialization and scale of operations, offer the firm more than it can usually achieve on its own.

Marketing channel functions

a) information:- the collection and dissemination of persuasive
communications about potential and current .
customers, competitors and other actors and forces in
the marketing environment.
b) promotion:- the development and dissemination of persuasive
communication about the offer designed to attract
customers.
c) negotiation:- the attempt to reach find agreement on price and other
terms so that transfer of ownership or possession can be
affected
Ordering:- the backward communication of intentions to buy the marketing
channel members to the manufacturers.
financing:- the acquisition and allocation of funds required to finance
Inventories at different levels of the marketing channel.
Risk taking:- the assumptions if risks connected with carrying out the
channel work..
physical possession:- the successive storage and movement of the physical
products from raw materials to final customers.
Payment:- buyers paying their bills through banks and other financial
Institutions to the sellers.
Title:- the actual transfer of ownership from one organization or person to
Another.

Channel design decisions
Designing a channel systems calls for analyzing customers needs, establishing channel ob\ejectives, identifying the major channel alternatives and evaluating them.
a) analyzing service output levels desired by customers
understanding what, where, why, and how target customers buy the first step in designing the marketing channel produce five service outputs:-
a)lot size:- the lot size is the number of units that the marketing channel permits a typical customers to buy on a buying occasion. The smaller is the lot size, the greater the service output level that the channel must provide.
b)Waiting time:- waiting time is the average time that customer of That channel wait for receipt of the goods. Customers normally prefer fast delivery Channels. Faster service requires a great service output level.
c)special convenience:- special convenience expresses the degree to which the marketing channel makes it easy for customers to purchase the product.
d)product variety:- product variety represents the assortment breath provided by the marketing channel. Normally customers prefer greater Assortment breadth because it increases the chance of exactly meeting their need.
e)service backup:- service backup represents the add-on service (credit,delievery, installation, repairsI) provided by the channel. The greater the service. backup, the greater the work provided by the channel.

The marketing manager must know the service output desired by the target customers provided increased levels of service output means increased costs for the channel and higher prices for customers.

VI) Product Development: at this stage the company will determine whether the product can be translated into a technically and commercially feasible product. The job is to translate customer requirement into a working prototype. When the prototypes are ready, they must be put through rig rows functional tests and customer tests. The product is tested to see how it performs in different applications. Consumer testing can take several forms, from bringing consumers into a laboratory to giving them samples to use in their homes.

VII) Market Testing: After management is satisfied with functional and psychological performance, the product is ready to be dressed up with a brand name and packing, and put into a market test. The new product B introduced into an authentic setting to learn how large the market is and how consumers and dealers react to handling, using and repurchasing the product.
The amount of market testing to influenced by the investment cost and risk on one hand, at the time pressure and research cost on the other. High investment-high risk products, where the changes of failure to high, must be market tested; the cost of market tests will be insignificant percentage of the total project cost, high-risk products-those that create new product categories, or have novel features- warrant more market testing than modified products.
The amount of market testing may be severely reduced if the company is under great time pressure because competitors are about to launch their brands. The company may therefore prefer to face the risk of a product failure to the risk of losing distribution or market penetration on a highly successful product.
VIII) Commercialisation: If the company goes ahead with commercialization, it will face its largest cost to date. The company will have to contract for manufacture or build or rent a full scale manufacturing facility. Plant size will be critical promotion.
The company must decide whether to launch the new product in a single locality, a region, several region, the national market or the international market. The company size is an important factor here. Small companies will select an attractive city to put on a blitz campaign. They will enter other cities one at a time. Large companies will introduce their product into a whole region and then move to a next region. Companies with national market, such as auto companies will launch their new models in the national market. Most companies design new products to sell primarily in the domestic market. If the product does well, the company considers exporting to foreign countries, redesigning if necessary.

“A marketing intelligence system is a set of procedures and sources used by managers to obtain their everyday information about pertinent developments in the marketing environment”.

Managers scan the environment in four ways:

- Undirected viewing : General exposure to information where the manager has no specific purpose in mind.
- Conditional viewing : Directed exposure, not involving active search, to a more or less cleanly identified area or type of information.
- Informed Search : A relatively limited and unstructured effort to obtain specific information or information for a specific purpose.
- Formal Search : A deliberate effort usually following a pre-established plan, procedure or methodology – to secure specific information or information relatively to a specific issue.

Marketing Managers carry on marketing intelligence mostly on their own by reading books, newspapers and trade publications, talking to customers, suppliers, distributors and other outsiders and talking with other managers within the company. Well-run companies take additional steps to improve the quality and quantity of marketing intelligence. First, they train and motivate the sales force to spot and report new developments. Sales representatives are the company’s ‘eye and ears’. They are in an excellent position to pick up information missed by other means. Secondly, the company motivates distributors, retailers and other middlemen to pass along important intelligence. Some companies appoint specialists to gather marketing intelligence. They send out “Ghost Shoppers” to monitor the presentations of retail personnel. Much can be learned about competitors through purchasing their products, attending open houses and trade shows, reading competitor’s published reports and attending stock holders meeting; talking to their former employees and present employees, dealers, distributors, suppliers and freight agents collecting competitors’ ads.

Thirdly, the company purchases information from outside suppliers such as NRS (National Readership Survey Report) etc. These research firms can gather store and consumer-panel data at much less cost than it each company carried out its own panel operations.

Means shifting an employee to a higher position carrying greater pay, status & responsibilities Various positions in an organisation are usually filled up by promotion of existing employee on basis of merit or seniority or combination of both.

2) Transfer:-

Refers to change in job assignment which may involve promotion, demotion or no change in terms of responsibility & status. Transfer may be either temporary or permanent depending upon necessities of filling jobs. Transfer generally involves no significant change in pay, status & responsibility of employees.

Advantages:-

1) Employees are motivated to improve their performance.
2) Industrial peace prevails in enterprise because of promotional avenues.
3) It is cheaper source as compared to external source.
4) Transfer of job is a tool of training employees to prepare them for higher job.
5) It promotes loyalty among employees as they feel secured on account of chances of advancement.

Limitations:-

1) The scope of fresh talent is reduced, when vacancies are filled through internal promotions.

2) The spirit of competition among employees may be hampered.

3) Frequent transfer of employees may reduce overall productivity of organisation.

4) There may be chances of conflict in fighting among employees who aspire for promotion to available vacancies as those not promoted may become unhappy & there efficiency may decline.

EXTERNAL SOURCES

1) Advertisement:-

Enterprise advertises vacancies through newspaper, trade journals & magazines. The content of advertisement & media through which advertisement is to be given is decided by Human Resource department. It is convienient & economical method.

2) Casual Callers:-

On occassions people drop in without any announcement of vacancy to find out if jobs are available. A waiting list of such visitors may be prepared & they may be screened to fill the vacancies whenever they arise.

3) Gate hiring or Recruitment at factory gate:

It is usually followed by factories to fill up vacancies at lower level. Large enterprises usually plays a notice on notice board specifying details of job available. A large number of unemployed persons assemble at gate where personnel manage scrutinise them & pick the persons as per requirement Small workshops recruit fitters, welders etc, through this source.

4) Educational Institutions:-

School, colleges & professional institutions offer opportunities for recruiting their students. Prospective employeers varify credentials of students & conduct interview directly, placement cells have been set up in well known educational institutions to help students in securing suitable jobs.

5) Management Consultants:-

Help to recruit technical, professional & managerial personnel for example accountants, engineers. They specialise in middle level & top level executive placements. They maintain data bank of persons with different qualifications & skills & even advertise jobs on behalf their clients to recruit right type of personnel.

6) Recommendations:-

Friends & relative of present employees are also good source of recruitment. Many concern prefer such candidates as they generally stand surety for new recruits and their background is partly known & type of preliminary screening take place.

7) Labour Contractor:-

Workers are recruited through labour contractors who are themselves employees of organisation. The dis advantage of this system is that if contractor leaves the organisation, all the workers employed through him will also leave. Recruitment through this source has been banned for public sector units. However, this practice is still common in case of construction industry.
Telecasting:-

The practice of telecasting of vacant posts over T.V. (Doordarshan & other channels) is gaining importance these days. Special programmes like ‘Job Watch’, ‘Youth Pulse’, ‘Employment News’ etc, over T.V. have become quite popular in recruitment for various types of jobs.

The use of T.V. as a source of recruitment is less as compared to other sources because it is an expensive medium.

9) Union list:-

‘Sometimes trade Unions list maintain list of candidates seeking employment in the concern. Such candidates could be recruited in consultation with union.

10) Central application file:-

A file is maintained of past applicants who were not selected earlier, in case of immediate requirements such candidates can also be contacted.

Merits:-

1) Wide Options:-

It brings large number of applicants as it permits enterprise to have free hands in making selection.

2) Fresh talent:-

Enterprise can expect to get fresh talented candidates from outside which leads to infusion of New Blood & new ideas in to enterprises.

3) Element of competition:-

This is a healthy feature from point of view of enterprise as internal candidates have to compete with outside candidate.

Limitations:-

1) Lengthy process:-

It takes long time. The business has to notify vacancies & wait for applicantions to initiate selection process.

2) Costly process:-

A lot of money has to be spent on advertisement & processing of applications.

3) Uncertain Response:-

The candidates from outside may not be suitable for enterprise. There is no guarantee that enterprise will be able to attract right kinds of people from external sources.

4) Dissatisfaction among Existing staff:-

They may feel that their chances of promotion may be reduced.

The aim of recruitment is to attract a large number of applications from job seekers. It makes the requirements of job known to the likely candidate in the job market. It provides sufficiently large group of qualified candidates so that most eligible employees can be selected. Thus recruitment is a positive activity which seeks to persuade people to apply for jobs.

The process of recruitment:-

(i) Identifies different source of labour supply.
(ii) Assesses their validity.
(iii) Chooses the most suitable source or sources.
(iv) Invites applications from prospective candidates for vacant jobs.

SOURCES OF RECRUITMENT:-

1) Internal Source (recruitment from within enterprise)
2) External Source (recruitment from outside)