vol02no01_rjcbs.pdf - The International Journal

Table of Contents

Articles

IDENTIFICATION OF EDIBILITY OF LEFTOVER FOOD AND ITS IMPACT ON FOOD SAFETY

Ramesh Kumar S

INNOVATION: ADOPTION AND IMPLEMENTATION IN MALAYSIAN HEAVY CONSTRUCTION SECTOR

Dileep Kumar Mohanachandran

“ENVIRONMENTALLY CONSCIOUS CONSUMER BEHAVIOR: AN EMPIRICAL STUDY”

Namita Rajput, Preeti Bajaj, Geetanjali Batra

MANAGEMENT OF OCCUPATIONAL STRESS IN INDIAN CONTEXT

Dr. K. Sundar, Dr. G. Ezhilan

ALIGNING CSR WITH HUMAN RESOURCE MANAGEMENT – THE KEY ROLE OF AN ORGANISATION

Dr. A. Savari muthu, M. Irudhaya Raj

A STUDY ON EXPORT OF WHEAT AND DOCUMENTS REQUIRED

Kalpana Agrawal

A STUDY ON IMPORT SCENARIO OF COLORED GEMSTONE AND DIAMONDS IN INDIA

Kalpana Agrawal

Case Studies

QUALITATIVE CASE STUDY: SHOULD ENTREPRENEUR’s BELIEVE, “LEADERSHIP IS INNATE”?

Dileep Kumar Mohanachandran

www.theinternationaljournal.org > RJCBS: Volume: 02, Number: 01, November-2012 Page 1

Identification of Edibility of leftover Food and its impact on Food Safety

Ramesh Kumar S, Associate Professor and Head, Department of Commerce, V.O.C.College, India

Abstract

In India, food borne diseases are an important reason for diarrhoeal deaths among children (<5 years)

are attributed to edibility of food. The main object of this research work is to identify the edible food.

The identification of edible food is based on different methods. This study identifies the right method.

Majority of the mothers identified the edibility of the food by a smell. Mothers in the age group of 31-

36 years identify the edibility of leftover food by sight. Housewives are expert in identifying the

edibility of food by sight. Quantitative data collected from mothers (n=2685) using Knowledge,

Beliefs and Practices (KBP). Percentage, Crosstabs and chi-Square statistical tools are used to identify

the exact result. The food handlers should be trained is identifying the edible food. Investment should

be made in modern facilities and utilities and the development should be in food safety education

programs.

INTRODUCTION

Contaminated food contributes to 1.5 billion cases of diarrhea in children each year, resulting in more

than three million premature deaths, according to the World Health Organization (WHO). Most

consumers still do not follow recommended safe food handling practices, such as safely defrosting

meat and poultry, properly using a food thermometer, safely handling leftovers, and immediately

discarding food that may be unsafe (Kurtzweil, P. 1999). In their study revealed that, food borne

diseases are an important reason for diarrhoeal among Indian children (< 5 years). Since many food

borne illnesses arise from home kitchens, mothers are the final line of defense against food become

diseases. The result of their analysis shows that, over (90%) wash hands before feeding children,

sending or cooking food. (60%) Store leftover cooked foods at room temperature. High incidence of

food borne illnesses was reported in the families (21%) and community (12%), 48% buy packed foods

and majority (78%) do not recognize symbols on the food labels (Subha 2001).

2. MATERIALS AND METHODS

2.1 RESEARCH DESIGN

The survey examines the consumption of half cooked food among the mothers in different

demographic characters during the period of 5th

February 2010 to 30th

September 2011 as a part of

Ph.D research work. The study covers Tuticorin, Tirunelveli, Virudhunagar, Kanyakumari and

Ramanathapuram districts in Tamil Nadu, India. The balanced structure of sample of 2685 mothers has

been taken through convenience sampling method. The questionnaire has two sections: (1) a

demographic profile, (2) identification of edibility of leftover food. The research scholar and research

assistants were well trained in collecting data. Each respondent took 25 to 30 minutes to complete a

questionnaire. The questionnaires were prepared in both English and Tamil. In rural areas, Tamil

questionnaires were given to collect data. In addition, the research assistants explained the questions in

detail. They collected data in the afternoon in rural areas due to the respondents engaged with farm

activities in the morning session.

2.2 PILOT STUDY

The questionnaire was pre-tested by collecting data from 105 mothers both in urban and rural

areas in the months of November and December 2010. This helped to confirm practical applicability,

clarity and to avoid unnecessary questions. The questionnaire was revised and restructured based on


the results of the pilot study. Some additional questions were added after evaluating the questionnaire

in the pilot study.

2.3 DATA ANALYSIS

The responses from mothers were analyzed by using a statistical package. Scores for each test

category were calculated by assigning correct responses. Cross tabulations were used to compare

indicators across demographic characteristics. Chi-Square analysis and percentage analysis of each

category were calculated and presented in the tabular form.

3. RESULTS AND DISCUSSION

Table: 1 Identification of the Edibility of Leftover Food through Different Methods

Respondents Percentage

Viewing 876 32.6

Tasting 829 30.9

smelling 980 36.5

Total 2685 100.0

Table1 indicates the identification the edibility of leftover food. Majority (36.5%) of the

mothers identify the edibility of leftover food by a smell, 32.6% of the mothers identify it by tasting

and the remaining 30.9% of the mothers identify the edibility of leftover by observation. It is

concluded that majority of the mothers identify the edibility of leftover food by smell, and it is

followed by taste and observation.

Table: 2 Age Factor in identifying the edibility of the Leftover Food

Age Methods in identifying edible food Total

Viewing Tasting Smelling

Below 25 Respondents 99 49 89 237

Age 41.8% 20.7% 37.6% 100.0%

Identification of the

Edibility of Leftover Food

11.3% 5.9% 9.1% 8.8%

25-30 Respondents 262 243 266 771

Age 34.0% 31.5% 34.5% 100.0%



29.9% 29.3% 27.1% 28.7%

31-36 Respondents 268 372 399 1039

Age 25.8% 35.8% 38.4% 100.0%



30.6% 44.9% 40.7% 38.7%

37-42 Respondents 137 110 115 362

Age 37.8% 30.4% 31.8% 100.0%



15.6% 13.3% 11.7% 13.5%

Above 43 Respondents 110 55 111 276

Age 39.9% 19.9% 40.2% 100.0%



12.6% 6.6% 11.3% 10.3%

Total Respondents 876 829 980 2685

Age 32.6% 30.9% 36.5% 100.0%



100.0% 100.0% 100.0% 100.0%


Table 2 analyses the different age groups of mothers and their identification methods of

edibility of left over food. Out of 2685 respondents, majority (38.7%) of the mothers are in the age

group of 31-36 years. In this age group, 38.4% of mothers identify the edibility of left over food by a

smell, 35.8% by taste and 25.8% by sight. It is followed by 28.7% of mothers in the age group of 25-

30 years. In this age group 34.5% of the mothers identify the edibility of the leftover food by a smell,

34% by sight and 31.5% by taste. Further, 13.5% of the mothers are in the age group of 37-42 years.

Among them, 37.8% of the mothers identify the edibility of left over food by sight, 31.8% by smell

and 30.4% by taste. It is followed by 10.3% of the mothers where in above 43 years of age. In this

category, 40.2% of the mothers identify the edibility of left over food by a smell, 39.9% by sight and

19.9% by taste. Further, 8.8% of the mothers are below 25 years of age. In this age group 41.8% of

mothers identify the edibility of the leftover food by sight, 37.6% by smell and 20.7% by taste. It is

concluded that mothers in the age group of 31- 36 years identify the edibility of leftover food by sight,

taste and smell.

Table: 3 Association between Mothers’ Age and their Identifying the Edibility of the Left over

Food

Value df Asymp. Sig.

(2-sided)

Pearson Chi-Square 61.036a 8 .000

*

Likelihood Ratio 63.527 8 .000

Linear-by-Linear Association .036 1 .850

N of Valid Cases 2685

*Significant at 5% level

Since, the P value is less than 0.05, in this study. Null Hypothesis is rejected at 5% level of

significance. It is concluded that there is a significant association between the identification of edibility

of leftover food and age. Hence, the mother’s age influences the identification of the edibility of

leftover food. As the age increases, the capacity to identify the edibility of leftover food also increases.

Table: 4 Mothers’ Educational level and its impact on Identification of Edibility of Left over

Food

Educational

level

Methods in identifying edible food Total


Illiterate Respondents 275 234 261 770

Educational level 35.7% 30.4% 33.9% 100.0%

Identification of the edibility

of Leftover Food

31.4% 28.2% 26.6% 28.7%

School level Respondents 437 472 544 1453



of Leftover Food

49.9% 56.9% 55.5% 54.1%

College Level

Respondents 164 123 175 462



of Leftover Food

18.7% 14.8% 17.9% 17.2%

Total

Respondents 876 829 980 2685



of Leftover Food

100.0% 100.0% 100.0% 100.0%

Table 4 analyses the educational qualification of mothers and their methods to identify the

edibility of leftover food. Out of 2685 respondents, 54.1% of mothers have completed school level

education. Among them, 56.9% of mothers identify the edibility of leftover food by taste, 55.5% by


smell and 49.9% by sight. It is followed by 28.7% of illiterate mothers. In it, 35.7% identify the

edibility of leftover food by sight, 33.9% by smell and 30.4% by taste. Further, between 17.2% of

mothers who have completed college level education, 37.9% identify the edibility of leftover food by a

smell, 35.5% by observing and 26.6% by taste. It is concluded that majority of the mothers who have

completed school level education identify the edibility of leftover food by sight, taste and smell.

Table: 5 Associations between Mothers’ Education and their Identification of Edibility of

Leftover Food

Value df Asymp. Sig. (2-sided)


*


Linear-by-Linear Association 1.652 1 .199



In this table, since the P value is less than 0.05, the null hypothesis is rejected at 5%

significance level. It is concluded that there is a significant association between educational

qualification of mothers and their methods of identifying the edibility of left over food. Hence,

mother’s educational qualification is related to the methods of identifying the edibility of leftover food.

Table: 6 Impact of Occupation in Identify the edibility of the Leftover Food

Occupation Methods in identifying edible

food

Total

Viewing Tasting smelling

Housewife Respondents 578 461 538 1577

Occupation 36.7% 29.2% 34.1% 100.0%

Identification of the Edibility of Leftover

Food

65.9% 55.6% 54.9% 58.7%

Employed Respondents 139 237 248 624

Occupation 22.3% 38.0% 39.7% 100.0%


Food

15.9% 28.6% 25.3% 23.2%

Daily

wages

Respondents 159 131 194 484

Occupation 32.9% 27.1% 40.1% 100.0%


Food

18.2% 15.8% 19.8% 18.0%


Occupation 32.6% 30.9% 36.5% 100.0%


Food

100.0% 100.0% 100.0% 100.0%

Table 6 analyses the occupation of mothers, and their methods used to identify the edibility of leftover

food. Out of 2685 respondents, 58.7% of the mothers are housewives. Among them, 36.7% of mothers

identify the edibility of leftover food by sight, 34.1% by smell and 29.2% by taste. It is followed by

23.2% of employed mothers. Among the employed mothers, 39.7% identify the edibility of leftover

food by a smell, 38% by taste and 22.3% by sight. Further, 18% of the mothers obtain daily wages. In

it, 40.1% of mothers identify the edibility of the leftover food by a smell, 32.9% by sight and 27.1% by

taste. It is concluded that majority of the mothers who are housewives identify the edibility of leftover

food by sight, taste and smell.


Table: 7Association between Occupation of Mothers and their Awareness of Safety of Leftover

Food



*





Since the P value in this table is less than 0.05, the null hypothesis is rejected at 5%

significance level. It is concluded that there is a significant association between occupation and

methods to identify the edibility of leftover food. Hence mothers’ occupation is related to methods to

identify the edibility of leftover food. Therefore, mothers at home identify the edibility of leftover food

better than employed mothers.

Table: 8 Influence of Monthly Income in Identifying the Edibility of the Leftover Food

Monthly Income Methods in identifying edible food Total


Below Rs.5000 Respondents 504 534 646 1684

Monthly Income 29.9% 31.7% 38.4% 100.0%


Edibility of Leftover

Food

57.5% 64.4% 65.9% 62.7%

Rs.5000-Rs.15000 Respondents 284 193 258 735

Monthly Income 38.6% 26.3% 35.1% 100.0%



Food

32.4% 23.3% 26.3% 27.4%

Above Rs.15000 Respondents 88 102 76 266

Monthly Income 33.1% 38.3% 28.6% 100.0%



Food

10.0% 12.3% 7.8% 9.9%


Monthly Income 32.6% 30.9% 36.5% 100.0%



Food

100.0% 100.0% 100.0% 100.0%

Table 8 indicates the monthly income of mothers and their identification methods of edibility

of leftover food. Majority (62.7%) of the mothers’ income is below Rs.5000. In it, 38.4% of mothers

identify the edibility of leftover food by a smell, 31.7% by taste and 29.9% by sight. It is followed by

27.4% of mothers in the income group of Rs.5000-15000. Here 38.6% of the mothers identify the

edibility of leftover food by sight, 26.3% by taste and 35.1% by a smell. Further 9.9% of the mothers’

income is above Rs.15000. In it, 33.1% identify the edibility of leftover food by sight, 38.3% by taste

and 28.6% by a smell. It is concluded that majority of the mothers’ monthly income is below Rs. 5000

and they identify the edibility of leftover food by sight, smell and taste.


Table: 9 Influence of Monthly Income in Identifying the Edibility of the Leftover Food



*





Since the P value of the study is less than 0.05, null hypothesis is rejected at 5% significance

level. It is concluded that there is a significant association between monthly income and methods to

identify the edibility of leftover food. Hence, mothers’ monthly income is related to the methods used

to identify the edibility of leftover food. Mothers in the low income group identify the edibility of

leftover food more than mothers.

Conclusion

Food-borne diseases are a serious threat to people in third world countries. In this study

majority of the mothers identify the edibility of the food by its smell, and it is followed by test and

observation. The housewives and the mothers in the age group of 31-36 years identify the edibility of

left over food by sight, taste and smell. As the level of age increases, the identity power of the

edibility capacity also increases. Mothers’ educational level also took important part in identifying the

edibility of the leftover food. The mothers at home identify the edibility of food better than employed

mothers. Income of the family also plays an important role in identify the edibility of food. The

mothers in the low-income group have been high lower than another income group of mothers.

Identifying edible food is unavoidable to avoid food borne diseases. The awareness about the measure

and precautions to be taken to avoid contamination is not up to the desired level. Even the public

hygiene remains a major area of concern for food safety authorities. Lack of infrastructure facilities,

especially in the unorganized sector is the major hurdle in the way of achieving desired standards of

food safety in the country. Investment should be made in modern facilities and utilities and the

development should be in food safety education programs.

References

1. Kurtzweil, P. (1999). Keeping food safety surveys honest: Video checks up on consumer meal

preps. FDA Consumer Magazine, 33(5), 18-21.

2. Subba Rao,, Gavaravarapu M., Sudeeshan Vemula, R., Pratima Rao, vishorce vardhana Rao

mendu (2001). “Focus Group Studies on Food Safety knowledge, Practices and Practices of

school going Adolescent Girls in South India”. Journal of Nutrition Education and Behavior;

Vol: 41(5); pp: 340-346.

3. World Health Organization, Food Safety Programme “ Food Safety – An Essential Public

Health Issue for the New Millenium”, 1999, (WHO/SDE/PHE/FOS/99.4), [hereafter “Food

Safety An Essential Public Health Issue for the New Millenium], at p. 7.


Innovation: Adoption and Implementation in Malaysian Heavy construction sector

Dr. Dileep Kumar M, Professor – HRM/OB/ Strategic Management, Othman Yeop Abdullah

Graduate School of Business, Universiti Utara, Malaysia.

Abstract

The distinctive characteristics of construction sector significantly differentiate itself from

manufacturing. Past researches seem have been given less attention to the innovation in the

construction sector. The purpose of this study reviews the relationship of firm’s innovativeness in

regard to the degree of innovation implementation and adoption. A total of fourteen hypotheses is

developed and tested in this study. These hypotheses are established within the context of heavy

construction sector characteristics that are consistently considered to be significant determinants of

firm innovativeness. These characteristics include (1) market structure characteristics, (2) organization

and task characteristics, (3) adopter industry competitive environment, and (4) external cooperation

linkage. Hypotheses were tested utilizing survey data collect from Malaysia Construction Industry

Development Board, which registered as CIDB Grade 7 construction firms throughout the Malaysia.

This study has reviewed the problem of determinants of firms’ innovativeness in technological

innovation the Malaysian heavy construction sector to meet the outlined objectives. The results

indicate that adopter industry competitive environment and external cooperation linkage are among the

variables that significantly affect the degree of innovation implementation. Results also indicate that

13 out of 14 hypotheses are supported and positively affecting the degree of innovation

implementation and adoption. Therefore, the results suggest that increasing the rate of innovation

implementation and adoption may be enhanced to a greater degree by increasing adopter industry

competitive environment and external linkage rather than implementing market structure environment

characteristics or organization and task characteristics. This study has pertinent value and has

advanced knowledge in the construction industry, especially, and hence the aim of this study has

successfully attained.

Keywords: innovation, determinants of firms, innovativeness, heavy construction sectors

1.0 Overview of Study

The aim of this research was to investigate and evaluate issues related to the nature of technological

innovation implementation and adoption within the Malaysian construction industry, with particular

reference to the heavy construction sector.

Based on an exhaustive review of the literature and discussions with Malaysian construction industry

experts, a total of fourteen hypotheses was developed. These hypotheses were established within the

context of Malaysian construction industry characteristics that are consistently suggested to be

significant determinants of firms’ innovativeness. These characteristics included: 1) Industry

fragmentation; 2) Metropolitan location; 3) Firm size; 4) Presence of trade unions; 5) Professional and

trade association affiliations; 6) Complexity; 7) Management intensity; 8) Firm experience; 9)

Construction industry; 10) Perceived environmenttal uncertainty; 11) Competitive rivalry; 12) Firm-

university cooperation; 13) Firm-research center cooperation; 14) Firm-government cooperation.

A survey was developed, pretested, and administered to 703 CIDB G7 contractors throughout the

Malaysia. Returned surveys provided information concerning firm demographics, structure, operation,

and perceptions of the innovation. Two forms of data analysis were utilized to test the fourteen

hypotheses, to determine how the individual characteristic affects the dichotomous choice of firms’

innovation implementation and adoption or rejection in the heavy construction sector. MRA was

adopted to test all the hypotheses. Similarly, a new model was established using the combination of


PCA and MRA as determinants of firms’ innovativeness to predict the degree of innovation

implementation and adoption.

The results of the regression analyses indicate that external cooperation linkage which consists of firm-

university cooperation, firm-research center cooperation and firm-government cooperation was the

variable found to be statistically significant in affecting technological implementation and adoption of

innovation across the Malaysian heavy construction sector.

Although the literature continually cites organization and task characteristics as being the major

inhibitor of construction firms on implementation and adoption of innovations, the results of this study,

conducted within the context of the heavy construction sector, clearly indicated that firm size, type of

construction and experience in construction have little or no influence on firm innovation

implementation and adoption behavior. In fact, the results indicate that external cooperation linkage

and adopter industry competitive environment were more likely to affect firm adoption behavior than

factors related to organization and task characteristic. Therefore, the results suggest that increasing the

rate of implementation and adoption may be enhanced to a greater degree by increasing external

cooperation, perceived environmental uncertainties and competitive rivalry attributes rather than

implementing and adopting such measures as increasing organizational and task characteristic.

2.0 Research Objective

This research focuses on determinants of firms’ innovativeness on construction technologies in

affecting the degree of innovation implementation and adoption, which has been received little or no

attention from those researchers in the construction industry. Thus, it is the objective of this study to

extensively review the determinants of firms’ innovativeness in the Malaysian construction industry

context, or specifically to test and analyze all hypotheses established from the extensive literature

review, in relation to the degree of technological innovation implementation and adoption in the heavy

construction sector.

3.0 Research Questions

Through the investigation of the determinants of innovativeness in the Malaysian construction

industry, this research addresses the research questions of to what extends the hypotheses influence

and affect the implementation and adoption of innovation? Further, are all the hypotheses established

from the literature review supported in the local construction industry context? The research questions

assist to test the hypotheses established from the extensive literature review. Although the focus of this

research is on firms’ innovativeness on technological innovation implementation and adoption,

construction materials suppliers can also be benefited from the results of this research.

4.0 Significance of the Research

The project price instability has provided an opportunity for contractors to determine the

implementation and adoption of better construction technologies to increase their market share in the

construction industry. Despite their ability to produce cost-competitive, resource-efficient outputs,

most contractors have had only limited success in gaining wide-scale acceptance of their outputs by

project owners. This lack of market success has been attributed to inefficient market planning,

implementation and adoption. An even more fundamental factor causal to this problem is the basic

lack of information related to identifying those factors that affect the rate of innovation implementation

and adoption, as well as determination of the relative importance of the different factors that influence

construction firms’ innovativeness.


Much of the concern for innovation in the construction industry has focused on innovation in design

than construction processes (Seng, 2012). An emphasis on individual construction projects as the basis

for analysis has supported increasingly misleading views of the rate of innovation and by the way

many new technologies are introduced in the industries. Contractors that involved in the construction

processes are an important and neglected source in implementation and adoption of new technologies,

a source that is often ignored by studies of innovation in the construction industry. From the standpoint

of applied research, the significance of this study is that it provides contractors guide to general

determinant factors in the implementation and adoption of innovative construction technologies that

can be used to devise strategic marketing plans and finally for enjoyment of competitive advantages.

5.0 Research Framework

Figure 1 illustrates the conceptual model of factors that are hypothesized to influence construction

firms’ innovativeness with regard to the implementation and adoption of construction technologies.

This model integrates several components of competitive effects that were investigated in Gatignon &

Robertson (1989), Abdullah (1991), Seng (2011&2012) and Ghassan (2011). Additionally, some

factors corresponding to the extant theory of innovation implementation and adoption by organizations

are included in the model since they can contribute to the prediction of innovation implementation and

adoption choice behavior. These factors are fully developed based on existing theories. Hypotheses are

then formulated to explain construction firms’ innovativeness with regard to the implementation and

adoption of construction technologies, in the next section of this research.

Figure 1 Conceptual model of construction firms’ innovativeness

6.0 Hypotheses

A total of fourteen hypotheses has been developed in this study as determinants of firms’

innovativeness in the heavy construction sector, Malaysia. The hypotheses are mainly classified into

one of four domains; 1) market structure characteristics, 2) organization and task characteristics, 3)

adopter industry competitive environment, and 4) external cooperation linkage. The domain of market

structure characteristics consists of the following hypothesizes determinants of firms’ innovativeness:

industrial fragmentation, metropolitan location, and firm size. The domain of an organization and task

characteristics consists of the type of construction, presence of trade unions, professional and trade


association affiliations, complexity, management intensity, and experience in the construction industry.

The domain of the adopter industry competitive environment consists of perceived environmental

uncertainty and competitive rivalry as determinants of firms’ innovativeness. The domain of external

cooperation linkage consists of firm-university cooperation, firm-research center cooperation, and

firms-government cooperation. Table 1 provides a summary of the determinants of firms’

innovativeness in the construction industry with regard to the implementation and adoption of

construction technologies.

Table 1 Summary of the hypothesized determinants of firms’ innovativeness in the construction

industry

Determinants of Firms Innovativeness

Market Structure Characteristics

H1 Industry fragmentation is negatively associated with construction firms’ innovativeness with

respect to construction technologies implementation and adoption.

H2 The degree of urbanization of the firm's primary operating location is positively associated

with construction firms’ innovativeness with respect to construction technologies.

H3 The innovativeness of firms with respect to construction technologies implementation and

adoption in the construction industry is positively affected by the firm size.

Organization and Task Characteristics

H4 Type of construction will significantly affect the firms’ innovativeness with respect to

construction technologies implementation and adoption.

H5 Increasing presence of trade union within construction firms is positively associated with

firms’ innovativeness with respect to construction technologies implementation and adoption.

H6 There is a positive association between affiliation with professional and trade associations and

construction firms’ innovativeness with respect to construction technologies implementation

and adoption.

H7 Construction firms’ innovativeness with respect to particular construction technologies

implementation and adoption is positively affected by the complexity nature of the


H8 A positive relationship exists in the construction industry between firm management intensity

and innovativeness with respect to construction technologies implementation and adoption.

H9 Construction firm experience interacts to influence firms’ innovativeness with respect to


Adopter Industry Competitive Environment

H10 Construction firms’ innovativeness with respect to construction technologies implementation

and adoption will be greater for firms that exhibit low levels of state uncertainty relative to

those firms that exhibit high levels of state uncertainty.

H11 Firm perception of the competitive rivalry in the construction industry will positively affect

the decision on implementation and adoption of particular construction technologies.

External cooperation linkage

H12 Firm-university cooperation is positively influencing the degree of firms’ innovativeness in


H13 Firm-research center cooperation has provided some exposure to the high capabilities and

expertise in innovation of construction technologies.

H14 Firm-government cooperation will help the firms’ intensity to extensively try new


7.0 Results and Discussion

A total of 703 questionnaire surveys was mailed to randomly selected construction firms that operating

in Malaysia and registered as G7 contractor with CIDB. The number of returning usable surveys


totaled 383, yielding an effective response rate of 45.52%. In order to answer the research question,

which addressed the relationship between the various determinants of firms’ innovativeness in

technological innovation implementation and adoption, linear regression analyses were conducted. In

light of the results of the regression analysis, some improvements have to be made, if it is not

supported by the statement of hypotheses stated earlier. The hypotheses tested in this study are as

follows:

H1: Industry fragmentation is negatively associated with construction firms’ innovativeness with

respect to construction technologies implementation and adoption.

Based on the 383 firms, the following results were recorded. Table 2 shows the result which indicates

the two variables are positively associated; R2 = 0.058, Adj. R

2 = 0.055 and F = 23.080, p<0.01. This

means 5.8% of the variance increase in the degree of technological innovation implementation and

adoption was explained by the industrial fragmentation. Approximately 5.8% of the variance of the

construction technology innovation implementation and adoption is accounted for by its linear

relationship with the industrial fragmentation in the regression equation for predicting the construction

technology implementation and adoption.

Table 2 Results of regression analysis for industrial fragmentation

Therefore, hypothesis are not supported and then regressing is written as follows;

CFI = 15.505 + 0.229X + e……..Formula 1 …..Formulae 1

H2: The degree of urbanization of the firm's primary operating location is positively associated with

construction firms’ innovativeness with respect to construction technologies.



2 = 0.072 and F = 30.338, p<0.01. This

means 7.5% of the variance increase in the firms’ innovativeness was explained by the degree of

urbanization of the firm’s primary operating location. Approximately 7.5% of the variance of the

construction technologies innovation implementation and adoption is accounted for by its linear

relationship with the urbanization of the firm’s primary operating location in the regression equation

for predicting the firms’ innovativeness.

Model Summaryb

Model R R

Square

Adjusted R

Square

Std. Error of the Estimate

1 . 240a .058 .055 4.47690

a. Predictors: (Constant), IF

b. Dependent Variable: CFI

Coefficientsa

Model Unstandardized

Coefficients

Standardized

Coefficients

t

Sig.

B Std. Error Beta

1 Constant) 15.505 .898 17.258 .000

IF .229 .048 .240 4.804 .000

a. Dependent Variable: CFI


Table 3 Results of regression analysis for operation location

Model Summaryb

Model R R Square Adjusted R Square Std. Error of the Estimate

1 .273a .075 .072 4.43922

a. Predictors: (Constant), OL


Coefficientsa

Model

Unstandardized Coefficients

Standardized

Coefficients

t Sig. B Std. Error Beta

1

(Constant)

OL

14.905 .902

.273

16.522 .000

.480 .087 5.508 .000


Therefore, hypothesis are supported and then regressing is written as follows;

CFI = 14.905 + 0.480X + e …..Formulae

H3: The innovativeness of firms with respect to construction technology implementation and adoption

in the construction industry is positively affected by the firm size.


the two variables are positively associated; R2

= 0.073, Adj. R2

= 0.071 and F = 29.957, p<0.01. This

means 7.3% of the variance increase in the innovativeness of firms was explained by the firm size.

Approximately 7.3% of the variance of the construction technologies innovation implementation and

adoption is accounted for by its linear relationship with the firm size in the regression equation for

predicting the firms’ innovativeness.


CFI = 15.755 + 0.287X + e …..Formulae 3

Table 4 Results of regression analysis for firm size

Model Summaryb

Model R R Square Adjusted R Square Std. Error of

the Estimate

1 .271a 0.073 0.071 4.43699

a. Predictors: (Constant), FS


Coefficientsa

Model Unstandardized

Coefficients

Standardized

Coefficients

t Sig.

B Std. Error Beta

1 (Constant) 15.755 0.756 20.833 0

FS 0.287 0.052 0.271 5.473 0


H4: Type of construction will significantly affect the firms’ innovativeness with respect to construction

technologies implementation and adoption.



= 0.024, Adj. R2 = 0.021 and F = 9.264, p<0.01. This

means 2.4% of the variance increase in the innovativeness of firms was explained by the type of

construction. Approximately 2.4% of the variance of the construction technologies innovation


implementation and adoption is accounted for by its linear relationship with the type of construction in

the regression equation for predicting the firms’ innovativeness.

Table 5 Results of regression analysis for type of construction

Model Summaryb

Model R R Square Adjusted R

Square

Std. Error of the Estimate

1 .154a .024 .021 4.54638

a. Predictors: (Constant), TOC


Coefficientsa

Model Unstandardized Coefficients Standardized

Coefficients

t Sig.

B Std. Error Beta

1 (Constant) 17.352 .802 21.635 .000

TOC .170 .056 .154 3.044 .002



CFI = 17.352 + 0.170X + e …..Formulae 4

H5: Increasing presence of trade union within construction firms is positively associated with Firms’

innovativeness with respect to construction technologies implementation and adoption.



= 0.031, Adj. R2

= 0.028 and F = 12.150, p<0.01. This

means 3.1% of the variance increase in the innovativeness of firms was explained by the presence of

trade unions. Approximately 3.1% of the variance of the construction technologies innovation

implementation and adoption is accounted for by its linear relationship with the presence of trade

unions in the regression equation for predicting the firms’ innovativeness.

Table 6 Results of regression analysis for presence of trade unions

Model summary


1 .176a .031 .028 4.52962

a. Predictors: (Constant), PTU


Coefficientsa

Model


Standardized

Coefficients


1 (Constant) 16.684 .893 18.692 .000

PTU .215 .062 .176 3.486 .001



CFI = 16.684 + 0.215X + e …..Formulae 5

H6: There is a positive association between affiliation with professional and trade associations and

construction firms’ innovativeness with respect to construction technologies implementation and

adoption.



2 = 0.019 and F = 8.342, p<0.01. This

means 2.2% of the variance increase in the innovativeness of firms was explained by the professional

trade association affiliate. Approximately 2.2% of the variance of the construction technologies


innovation implementation and adoption is accounted for by its linear relationship with the

professional trade association affiliate in the regression equation for predicting the firms’

innovativeness.

Table 7 Results of regression analysis for professional trade association affiliate

Model Summaryb


1 .147a .022 .019 4.55237

a. Predictors: (Constant), PTAA


Coefficientsa

Model


Standardized

Coefficients


1 (Constant) 17.562 .768 22.854 .000

PTAA .150 .052 .147 2.888 .004



CFI = 17.562+0.150X + e……..Formulae 6

H7: Construction firms’ innovativeness with respect to particular construction technologies

implementation and adoption is positively affected by the complexity nature of the construction

technologies.



2 = 0.040 and F = 16.891, p<0.01. This

means 4.3% of the variance increase in the innovativeness of firms was explained by the complexity in

purchase and use. Approximately 4.3% of the variance of the construction technology innovation

implementation and adoption is accounted for by its linear relationship with the complexity in the

purchase and use in the regression equation for predicting the firms’ innovativeness.

Table 8 Results of regression analysis for complexity (purchase and use)

Model summary

Model R R Square

Adjusted R

Square

Std. Error of the

Estimate

1 .207a .043 .040 4.50614

a. Predictors: (Constant), Comp


Coefficientsa

Model


Standardized

Coefficients


1 (Constant) 15.630 1.016 15.388 .000

Comp .200 .049 .207 4.110 .000


Therefore, hypothesis is supported and the regressing is written as follow;

CFI = 15.630 + 0.200X + e…..Formulae 7

H8: A positive relationship exists in the construction industry between firm management intensity and

innovativeness with respect to construction technologies implementation and adoption.



2 = 0.047 and F = 19.569, p<0.01. This

means 4.9% of the variance increase in the innovativeness of firms was explained by the management

intensity. Approximately 4.9% of the variance of the construction technologies innovation


implementation and adoption is accounted for by its linear relationship with the management intensity

in the regression equation for predicting the firms’ innovativeness.

Table 9 Results of regression analysis for management intensity

Model Summaryb

Model R R Square

Adjusted R

Square

Std. Error of the

Estimate

1 .222a .049 .047 4.49325

a. Predictors: (Constant), MI


Coefficientsa

Model


Standardized

Coefficients


1 (Constant) 15.980 .864 18.486 .000

MI .247 .056 .222 4.424 .000



CFI = 15.980+0.247X + e… Formula 8 …..Formulae 8

H9: Construction firm experience interacts to influence firms’ innovativeness with respect to




2 = 0.063 and F = 26.429, p<0.01. This

means 6.5% of the variance increase in the innovativeness of firms was explained by the experience in

construction. Approximately 6.5% of the variance of the construction technologies innovation

implementation and adoption is accounted for by its linear relationship with the experience in

construction in the regression equation for predicting the firms’ innovativeness.

Table 10 Results of regression analysis for experience in construction

Model Summaryb


1 .255a .065 .063 4.44934

a. Predictors: (Constant), EIC


Coefficientsa

Model


Standardized

Coefficients


1 (Constant) 15.251 .893 17.083 .000

EIC .306 .060 .255

5.141

.000


Therefore, hypothesis is supported and then regressing is written as follows;

CFI = 15.251 + 0.306X + e…. Formulae 9 …..Formulae 9


H10: Construction firms’ innovativeness with respect to construction technologies implementation and

adoption will be greater for firms that exhibit low levels of state uncertainty relative to those firms that

exhibit high levels of state uncertainty.



2 = 0.084 and F = 35.687, p<0.01. This

means 8.6% of the variance increase in the innovativeness of firms was explained by the perceived

environmental uncertainty. Approximately 8.6% of the variance of the construction technologies

innovation implementation and adoption is accounted for by its linear relationship with the perceived

environmental uncertainty in the regression equation for predicting the firms’ innovativeness.

Table 11 Results of regression analysis for perceived environmental uncertainty

Model Summaryb

Model R R Square

Adjusted R

Square Std. Error of the Estimate

1 .294a .086 .084 4.40500

a. Predictors: (Constant), PEU


Coefficientsa

Model


Standardized

Coefficients


1 (Constant) 14.307 .927 15.438 .000

PEU .270 .045 .294 5.974 .000



CFI = 14.307 + 0.270X + e….. Formula 10 …..Formulae 10

H11: Firm perception of the competitive rivalry in the construction industry will positively affect the

decision on implementation and adoption of particular construction technologies.



= 0.074, Adj. R2 = 0.071 and F = 30.149, p<0.01. This

means 7.4% of the variance increase in the innovativeness of firms was explained by the competitive

rivalry. Approximately 7.4% of the variance of the construction technologies innovation

implementation and adoption is accounted for by its linear relationship with the competitive rivalry in

the regression equation for predicting the firms’ innovativeness.

Table 12 Results of regression analysis for competitive rivalry

Model Summaryb

Model R R Square

Adjusted R

Square

Std. Error of the

Estimate

1 .272a .074 .071 4.41929

a. Predictors: (Constant), CR


Coefficientsa

Model


Standardized

Coefficients


1 (Constant) 14.475 .971 14.905 .000

CR .261 .048 .272 5.491 .000




CFI = 14.475 + 0.261X + e ..Formulae 11

H12: Firm-university cooperation is positively influencing the degree of firms’ innovativeness in




2 = 0.113 and F = 49.474, p<0.01. This

means 11.6% of the variance increase in the innovativeness of firms was explained by the firm-

university cooperation. Approximately 11.6% of the variance of the construction technologies

innovation implementation and adoption is accounted for by its linear relationship with the firm-

university cooperation in the regression equation for predicting the firms’ innovativeness.

Table 13 Results of regression analysis for firm-university cooperation

Model Summaryb


1 .340a .116 .113 4.31670

a. Predictors: (Constant), FUC


Coefficientsa

Model


Standardized

Coefficients


1 (Constant) 13.499 .903 14.945 .000

FUC .418 .059 .340 7.034 .000



CFI = 13.499+0.418X + e…. Formula 12 …..Formulae 12

H13: Firm-research center cooperation has provided some exposure to the high capabilities and

expertise in innovation of construction technologies.



2 = 0.118 and F = 52.073, p<0.01. This


research center cooperation. Approximately 12.1% of the variance of the construction technology

innovation implementation and adoption is accounted for by its linear relationship with the firm-

research center cooperating in the regression equation for predicting the firms’ innovativeness.

Table 14 Results of regression analysis for firm-research center cooperation

Model Summaryb

Model R R Square

Adjusted R

Square Std. Error of the Estimate

1 .348a .121 .118 4.31952

a. Predictors: (Constant), FRCC


Coefficientsa

Model


Standardized

Coefficients


1 (Constant) 13.639 .868 15.720 .000

FRCC .412 .057 .348 7.216 .000



CFI = 13.639 + 0.412X + e… Formula 13 …..Formulae 13


H14: Firm-government cooperation will help the firms’ intensity to extensively try new construction

technologies.



2 = 0.346 and F = 201.388, p<0.01. This


government cooperation. Approximately 34.8% of the variance of the construction technology

implementation and adoption is accounted for by its linear relationship with the firm-government

cooperation in the regression equation for predicting the firms’ innovativeness.

Table 15 Results of regression analysis for firm-government cooperation

Model Summaryb

Model R R Square Adjusted R Square

Std. Error of the

Estimate

1 .590a .348 .346 3.71561

a. Predictors: (Constant), FGC


Coefficientsa

Model


Standardized

Coefficients


1 (Constant) 8.260 .826 10.002 .000

FGC .761 .054 .590 14.191 .000



CFI = 8.260 + 0.761X + e…. Formulae 14 …..Formulae 14

As a conclusion to the hypothesis testing, all the hypotheses were found satisfactory, supported and

accepted except Hypothesis 1, where Hypothesis 1 was rejected in Malaysia context. Although all the

recorded R2 and adjusted R

2 are found relatively low to strengthen the purposes of prediction, it is still

valid and useful for an explanation of the relationship between the variables that under investigate.

8.0 Recommendations for further researches

The research analysed and explained the determinants of firms’ innovativeness that influence the

degree in the implementation and adoption of innovation. Nonetheless, there are areas which

necessitate further research. Further developments of this work in possible in seven main areas.

1. The findings of the research are applicable only to heavy construction sector with particular

reference to the contractor G7 that registered with CIDB. Therefore, future research should

consider replicating the research in other registration groups or extending it to include other

types of sectors i.e. residential, commercial, industrial, and etc.

2. One area of future investigation that should be explored is the relationship between use of

different of construction technologies and engineering design. Observers of the construction

industry continuously cite industry structure variables and uncertainties as being the primary

factors inhibiting the implementation and adoption of new building materials.

3. Another natural extension of the research would be investigating the innovation implementation

and adoption processes in selected construction firms, in order to better understand the dynamics

of the innovation implementation and adoption processes to understand the actual predictive

power of the proposed model in this research. In order to supplement the variance approach used

in this research, future research should include a process approach including detailed interview

data and archival sources.


4. Additional area of research that should be seriously explored is the implementation and adoption

of interrelated innovations. It is highly likely that a construction firms’ implementation and

adoption of one product innovation directly affects their implementation and adoption of a

complementary product innovation. Therefore, an approach to investigating innovation

implementation and adoption in construction may yield some important information.

5. Future research should also concentrate on evaluating the relationship between product

implementation, adoption and marketing strategies. No research to date has been conducted in

the construction industry examining the impact of marketing strategy on technological product

implementation and adoption. Consequently, measures of marketing strategy effectiveness and

efficiency with innovation implementation and adoption are lacking in the construction industry.

9.0 Conclusion

Regression analysis is a statistical technique that attempts to explore and model the relationship

between two or more variables. Therefore, hypotheses were tested by the aid of regression analysis to

accomplish the objective of this research. The used of linear regression analysis was also aimed to

validate the hypotheses established through the exhaustive and intensive literature review. Based on

the analysis, all hypotheses except hypothesis 1 are supported. The models were formulated in

Formulae 1 to Formulae 14. As competitive pressures increase, there is a need to continuously adapt,

develop and innovate for organizational excellence. It again emphasizes the need of innovativeness as

structures, processes and a good blend of which will lead to organizational excellence. Innovation has

always been at the centerpiece of competitiveness. Experimentation, exploration and a drive to

maximize resources is as essential for the organization. True innovation often occurs in sudden

dynamic shifts.

References

[1] Abdullah, A.A. Technology adoption and innovation patterns in construction industry in Saudi

Arabia: An exploratory study. Ph.D. Dissertation, Austin: University of Texas, 1991.

[2] Gatignon, Hubert and Thomas R. Robertson. “Technology diffusion: An empirical test of

competitive effects”. Journal of Marketing, vol. 53, ,no. pp. 35-49, 1989.

[3] Ghassan A. “Facilitating innovation in construction”. Construction innovation, vol. 10, no. 4,

2010.

[4] Seng, N.W. Creativity and innovation in Design and Build Consortium – China Habour

Engineering Co. for Penang 2nd

Bridge. Consultation project, University Utara Malaysia, 2011.

[5] Seng, N.W. The model for determinants of firms’ innovativeness in Malaysian construction

industry. Proceeding in 3rd

ICTOM. Bandung, Indonesia, 4-6 July, 2012.


Environmentally Conscious Consumer Behavior: An Empirical Study

Namita Rajput, Associate Prof., Sri Aurobindo College, Delhi University, India

Preeti Bajaj , Assistant Prof, Amity University, Noida

Geetanjali Batra, Assistant Prof.,ARSD College, Delhi University

Abstract

Environmental problems are mainly attributable to the impact of humans on natural systems. Rapid

urbanization and rising consumer oriented lifestyle has intensified the environmental problems

management. There is an urgent need to increase public environmental awareness to counter and

conquer the problem. Studies of green behavior have awakened a growing interest, since the

accelerated environmental degradation is partly attributed to a lack of such behavior which is very

difficult to change. The objective of this study is to study those variables which influence “green-

buying”, investigate whether environmental attitudes are translated into actual consumer behavior in

relevant situations and to determine variables that predict environmentally conscious consumerism.

This paper summarizes variables extracted from four models of green behavior: Environmental beliefs,

Ecological knowledge, Environmental concern and Environmental Attitudes, with a special focus on

the sample taken from Delhi and NCR individuals as an example of application of environmental

marketing strategies. Analysis shows that there is a strong relationship between the five variables

discussed above and environmentally favorable behavioral intentions. Factor analysis was conducted

using CFA (Confirmatory Factor analysis) to find out relationship of variables within the construct.

Five hypothesis asserting relationships between major variables were established. Factors influencing

green purchase intention were correlated to form a linear relationship. These hypotheses were tested

using Chi Square. To analyse the data from a different perspective, a one-way multivariate analysis of

variance (MANOVA) was performed to investigate gender differences in green purchase behaviour.

Three dependent variables were used: environmental knowledge, environmental concern and

environmental attitudes towards green purchase. The fixed variable was gender. There was a

statistically significant difference between men and women on the combined dependent variables. Men

have greater environmental knowledge, concern and attitude towards Green Purchase as compared to

women. It is recommended to relate environmental issues to survival process, in order to apply

efficient environmental marketing strategies. The results of the study indicate that environmental

knowledge, habits and concern are strongly related to environmental beliefs and influence

Environmental attitude. However this is not reflected in intention to purchase or actual purchase

behaviour.

Key words: Green buying, environmental attitude, Factor analysis, linear relationship.

Introduction

The issue of environment has grown important over the past few decades, however the critical part of

this issue remains that the rate at which the problems related to environment are increasing is quite

higher than the rate at which the actions are taken to solve these problems. Whether it is government,

population or other organizations all are responding to the furies caused by the nature or human actions

rather than behaving proactively & taking a check at their current actions. The most important part in

this environmentally friendly behavior is to be played by the consumer. Follows & Jobber (1999) in

their study to develop a model to predict environmentally purchase behavior found that there will be a

positive relationship from attitude towards environmental consequences & a negative relationship from

attitude towards individual consequences to environmentally responsible purchase intention. Their

study also indicated that motivation to promote & enhance the welfare of others underlies positive

environmental attitudes. This behavioral intention is further formed by the combination of a positive or

negative attitude towards the behavior, a subjective norm to perform the behavior, and perceived


control over the behavior. Moreover, the attitude is determined by strengths of beliefs about

consequences of the behavior & evaluations of these consequences (Minton & Rose, 1997). By

imposing informal social sanctions the personal norm is tied to the self concept & is experienced as a

feeling of moral obligation (Schwartz, 1977). It refers to what “I feel morally obligated to do” &

motivates behavior by the desire to act in ways that are consistent with one’s values (Minton & Rose,

1997). Behavioral intention is an indication of an individual's readiness to perform a given behavior. It

is assumed to be an immediate antecedent of behavior (Ajzen, 1991). The strength of behavioral

intention further determines the likelihood of the behavior. Increasing economic activities in

developing countries result in more energy and consumption demand, which generally lead to

environmental degradation. There is a conventional belief that such environmental degradation would

resolve as soon as these countries grow economically since that would enable them to afford

environmental friendly technology as well as pro-environmental regulations and policies. However,

several studies indicated that many developing countries already equipped with environmental

policies, legal frameworks and economic instruments, which are regarded as highly sophisticated by

international standards (Hueber et al, 1998, Fujisaki et al, 1997) and yet face the worsening of

environmental conditions. Major difficulties these countries confront are not only the lack of legal and

economic framework for environmental protection, but also lack of participation among general public

in pro-environmental behavior. From the last three decades there has been gradual increase in public

concern for environmental issues.

The purpose of the study presented in this paper is to develop and test a model that explains the

potential influences of consumer‘s green buying behavior and general pro environmental concerns.

Moreover, there are increasing needs for such public participation due to the recent change in sources

of environmental problems. Today, the sources of pollution have shifted from production to

consumption processes. The Human Development Report of 1998 (UNDP) affirms this trend and states

that growth in consumption and unbalanced consumption patterns are placing unprecedented pressure

on the environment. In this light, the acceptance of pro-environmental behavior by general public, that

is, to adopt sustainable life style, is an urgent issue in protecting environment. Customer-centric

approaches put the customers into the central point of the marketing management processes of

companies. Therefore, the influence of environmental issues on marketing is an area of increasing

significance to industry and commerce.

A socially conscious consumer takes into account the public consequences of his or her private

consumption or who attempts to use his or her purchasing power to bring about social change. That is,

consumers incorporate social issues into their purchase decisions by evaluating the

consequences of their consumption upon society. Consumers who consider the environment to be

important will therefore evaluate the environmental consequences associated with the purchase of a

product. If the environmental consequences are important enough to the consumer, the result may be

the purchase of an environmentally responsible product. These products not only satisfy a consumer's

immediate needs and wants, but also serve to benefit the environment in the long term. The difficulty

with investigating environmentally responsible purchase behavior has been with its measurement.

First, many of the measures are normative in nature and can lead to socially desirable responses

(Roosen and De Pelsmacker, 1997). A scale composed of several statements all worded to represent

positive environmentally responsible actions can produce a halo- effect that encourages respondents to

over-report environmentally responsible behaviors. The result is an inflated level of environmentally

responsible behavior that does not correspond to actual market share data. Second, it is important for

researchers to clearly delineate between environmentally responsible intention and behavior.

Environmentally responsible products in general tend to be viewed as the socially acceptable choice

which can inflate intention relative to actual behavior. Finally, researchers often combine a wide range

of environmental purchase behaviors into a single measure. The scientists and ecologists worldwide

have come up with various ways to reduce the damage caused to the earth by using gases which emit

no pollution and are eco friendly, technological innovations, such as development of alternative fuels,


to resolve such dilemmas, rather than changing their behavior patterns and lifestyle choices. Though

such remedies and innovations have made remarkable gains in conserving resources and reducing

pollution, many scientists and environmentalists hold that solutions to environmental problems do not

lie in technology alone (Hardin, 1993; Stern, Young, & Druckman, 1992). Consumers must adopt

environmentally sound behaviors, such as reliance on public transportation and recycling of household

wastes and buy products that are environmental friendly in order to sustain the environment. This

paper aims to study variables that predict "green buying" (i.e., buying products that are

environmentally beneficial)-consumers' knowledge and beliefs about environmental products, green

buying habits, general environmental attitudes, and factors that influence environmentally conscious

purchases to find whether people with a pro-environment attitude act in ways consistent with that

attitude. The purpose of this research was to study the effect of environmental beliefs, knowledge,

concern and attitudes on environmental friendly behavioral intentions.

Marketers have reacted to consumers’ growing environmental consciousness by developing

“environmentally friendly” products. However, only a few “green” products have been successful

(Reitman 1991) despite the vast majority of consumers reporting that their purchases were influenced

by environmental concerns (Chase and Smith 1992). Little empirical evidence exists to support that

pro-environmental attitudes and beliefs translate into environmentally conscious behavior such as

green buying and recycling (Hume 1991). It is notable that pro-environmental behaviors differ from

general purchase-related consumer behaviors. Engaging in a general purchase behavior is driven by an

assessment of its benefits and costs that are relevant solely to the individual consumer performing the

behavior. Prior research has identified several key factors motivating environmentally conscious

behavior, including individuals’ concerns about the environment, their beliefs about their ability to

ease the problem (Ellen, Cobb- Walgren 1991), and an overall orientation towards the welfare of

others (Schwartz 1977; Stern, Dietz, and Kalof 1993) or towards their relationship with others

(McCarty and Shrum 2001).

In this backdrop the purpose of this paper is:

To study variables those influence “green- buying”.

To investigate whether environmental attitudes are translated into actual consumer behavior in

relevant situations.

To determine variables those predict environmentally conscious consumerism.

To achieve the objectives the study is divided into following sections: Section I gives the overview

and insights of green buying stating also giving the brief review of existing Literature, Section II gives

description of Data & methodology, Section III gives the analysis and interpretations of the results.

Section IV gives summary and conclusions and references are contained in the last section.

Section II: Data and Methodology

The Data and Data Collection

The study was carried out in the Delhi and NCR Region. The subjects of the study were aged over 18

and were residents of the community in the relevant district. A total of 500 respondents were

approached. However, only 244 questionnaires were received back which contained the complete

necessary information and were thus usable. Respondents were either interviewed or filled in the same

questionnaires online. The questionnaires covered respondents’ socio-demographic and economic

background, their attitudes about, and knowledge of the environment, and self-reported

environmentally responsible consumption practices, confusion about environmental claims, and

intention to purchase green products.

Demographic characteristics of the sample:

In our sample of 244, 63.9% respondents were in the age group of (20 – 30), 26.2% between (30 – 40)

and 9.8% between (40 – 50). 41% respondents were post graduates, 57.4% were graduates and 1.6%

was high school pass outs. 49.2% had annual family income less than 5 lakhs, 41% had annual family


income between 5 to 11 lakhs, 3.3% had annual income between 11 to 17 lakhs and 6.6% had annual

income between 17 to 22 lakhs. 36.1% respondents are male and 63.9% respondents are females.

49.6% respondents are married and 50.4% are single.

Figure 1: Demographic Characteristics of the population

Survey Instrument

Dependent measure: Actual green buying behaviour of the consumer which measures the extent to

which individual respondents purchase goods and services believed to have a more positive (or less

negative) impact on the environment.

Independent measures: Five key psychographic correlations as shown to be significant in the past are

included in the present study. These include environmental beliefs, environmental knowledge,

environmental habit, environmental concern and pro-environmental attitudes were the main

independent variables.

The purpose of this study is to systematically assess the effects of environmental belief, Ecological

Knowledge, Environmental Concern, Environment attitude, Intention to purchase on green purchase

behaviour and to elucidate the interrelationships among the constructs. In light of the aforementioned

discussion, a model is constructed and Figure 2 presents the proposed model with the hypothesized

structural linkages among the variables.

Figure 2: Model Estimation

+

+

+

+

+ +

+

F

ENVIRONMENTAL

BELIEFS

ENVIRONMENTAL

KNOWLEDGE ENVIRONMENTAL

ATTITUDE

GREEN PURCHASE

INTENTION

ACTUAL GREEN

PURCHASE

BEHAVIOR

ENVIRONMENTAL

CONCERN

ENVIRONMENTAL

HABIT


Testable Hypothesis

Five hypothesis asserting relationships between major variables were established.

1) H0: People with strong Environmental belief have less knowledge about ecological

issues.

H1: people with strong environmental belief have more knowledge about ecological issues.

2) H0: Consumers with strong Environmental belief have less concerned response towards

ecological issues.

H1: Consumers with strong environmental belief have more concerned response towards

ecological issues.

3) H0: Consumers concerned about the environment do not tend to have pro environmental attitude.

H1: Consumers concerned about the environment tend to have pro environmental attitude.

4) H0: Consumers who tend to have pro environmental attitudes do not show intention to purchase.

H1: Consumers who tend to have pro environmental attitudes show intention to purchase.

5) H0: Consumers with strong intention to purchase are not likely to actually purchase green

products.

H1: Consumers with strong intention to purchase are not likely to actually purchase green

products.

Section III: Analysis and Interpretations of Results

3.1 The Reliability Test of Scales

Cronbach’s alpha coefficient was used to determine the internal consistency reliability of each scale

used in this study. Cronbach's alpha is a measure of internal consistency, that is, how closely related a

set of items are as a group. A "high" value of alpha signifies that the items measure an underlying (or

latent) construct. The results of Cronbach Alpha are shown in table 1

Table 1: Summary of the Alpha Value for Each Scale.

SCALES NO. OF ITEMS α VALUES

Environmental Habits 14 .768

Environmental Belief 6 .801

Environmental Concern 11 .712

Environmental Knowledge 20 .778

Environmental Attitude 12 .689

Green Purchase Intention 11 .803

The results of Cornbach alpha test show that all the variables are significant as the value of each

variable is close to one. The intention to purchase green products has maximum influence on green

buying decisions followed by environmental beliefs, environmental knowledge, environmental habits,

and environmental concern.

3.2: Environmental Beliefs

Consumer environmental beliefs were judged on basis of 6 items. All items were ranked on 5 point

Likert scale. The items included were aimed to understand level of responsibility of the respondents

towards protecting the environment. The items were designed in such a manner so as to enable us in

drawing inferences about environmental beliefs of the respondents. Items Included questions like if we

have responsibility to avoid products that are damaging to the environment, we have responsibility use

products made from recyclable material, is it beneficial to use products that are produced locally, is it

beneficial to buy products from local store, is it beneficial to look for products using less packaging, is


it beneficial to carry own bag rather than a plastic carrier provided by shop owner. Factor analysis was

done using confirmatory Factor analysis technique on AMOS output results of which are shown below

in Figure 3 and Table 2(A) and 2(B).

Figure 3: Factor analysis using the confirmatory Factor analysis technique. (Environmental

Belief)

Table 2(A): Results of Confirmatory Factor Analysis (Environmental Beliefs)

Name of

the

variable

Enviro

nm

ental B

elief

S.E.

Estimate

Regression

Estimate

Squared

multiple

correlation P

EB5 <--- 1 0.074 0.006

EB1 <--- 6.622 0.648 0.42 0.28

EB2 <--- 9.92 0.923 0.852 0.282

EB3 <--- 2.546 0.243 0.059 0.299

EB4 <--- 1.442 0.09 0.008 0.403

EB6 <--- 5.84 0.476 0.227 0.283

Table 2(B): Results of Confirmatory Factor Analysis (Environmental Beliefs)

Model Fit Statistic

Chi-square 276.88

Comparative Fit Index (CFI) 0.607

Normed Fit Index (NFI) 0.796

RFI 0.745

Root Mean Square Error of

Approximation (RMSEA)

0.025

Interpretation


The standardized regression weights of each measured variable are shown in the Table 2(A). The

standardized regression weights indicate comparative influence of the construct to its variables. The

high value of the standardized weights indicates the higher influence of the construct to the variable.

The results indicate that the most important Environmental belief is responsibility to use products

made of recyclable material explains more than 92.3% of variation in the construct, followed by

responsibility to avoid purchasing the products that are damaging to the environment and carrying own

bag for purchasing rather than using plastic bag provided by the shop keeper as significant factors in

affecting the Environment Beliefs of consumer.

The squared multiple correlations indicate the percentage of variance of the measured variable that

can be explained with the help of the variations in the construct. The squared multiple correlations of

responsibility to use products made of recyclable material is .852. 85.2% of the variance of this

measure can be explained with the help of this construct. The squared multiple correlation of

responsibility to avoid purchasing the products that are damaging to the environment indicates that 42

percent of the variance of can be explained with the help of variations in Environmental belief

followed by carrying own bag for purchasing rather than using plastic bag provided by the shop keeper

which explains 22.7% variation. Rest all sources are insignificant to explain the variation in the

construct.

The statistics for goodness of fit of the model from AMOS output is shown in Table 2 (B) the results

indicate that the goodness of fit indices (CFI, RFI and NFI) is significantly high. Hence, the model is

fit. The Chi-square value is also presented in the table. The lower value of RMSEA also supports that

the model is fit.

3.3: Environmental Habits

To understand the environmental habits of the respondents, they were tested on basis of 14 items. All

items were ranked on Likert’s 5 point scale. The items included if they turned off lights of unused

room, keep heating or cooling low in the room, use solar power for home and water heating, purchase

energy efficient appliances which use logos like “energy Star”, if possible, walk or ride a bike to the

destination, minimize use of fresh water, wash laundry in cold water than warm or hot water to save

energy, prefer to buy fuel efficient vehicle, turn off tap when soaping or cleaning teeth, compost

garden/kitchen waste, recycle paper, reuse paper, use reusable batteries, repair electrical if not good

rather than buying new ones and donate old clothes to charity. Results of Factor analysis using

confirmatory Factor analysis technique on AMOS are shown below:

Figure 4: Factor analysis was conducted using the confirmatory Factor analysis technique.


Table 3(A): Results of Confirmatory Factor Analysis (Environmental Habits)

Name of

the

Variable

S.E

Estimate

Regression

Estimates

Squared

Multiple

Correlation P

EH13

EN

VIR

ON

ME

NT

AL

HA

BIT

S

1 0.425 0.181

EH9 <--- 3.183 0.765 0.586 ***

EH8 <--- 0.527 0.242 0.059 0.002

EH5 <--- 0.841 0.295 0.087 ***

EH1 <--- 0.247 0.271 0.073 ***

EH2 <--- 0.226 0.123 0.015 0.098

EH3 <--- 2.145 0.506 0.256 ***

EH4 <--- 1.128 0.521 0.272 ***

EH6 <--- 0.495 0.169 0.029 0.026

EH7 <--- 0.921 0.3 0.09 ***

EH14 <--- 0.277 0.075 0.006 0.301

EH12 <--- 1.026 0.309 0.096 ***

EH11 <--- 1.596 0.561 0.315 ***

EH10 <--- 2.226 0.598 0.357 ***

Table 3(B): Results of Confirmatory Factor Analysis (Environmental Habits)

Model Fit Statistic

Chi-square 278.88



RFI 0.745



0.045

Interpretation

The standardized regression weights of each measured variable are shown in the Table 3(A). The

results in Table 3(A) indicate that the most important Environmental Habit is turning off tap while

soaping or cleaning teeth which explains more than 70% of variation in the construct, followed by

purchasing appliances with logos like Energy Stars, using solar power, recycling or reuse of paper.

The squared multiple correlations of turning off tap as an environmental habit is .315. This indicates

that 31.5 percent of the variance of this measure can be explained with the help of construct. The

squared multiple correlations of energy efficient electronic appliances indicate that 21.5 percent of the

variance can be explained with the help of variations in environmental habit.

The statistics for goodness of fit of the model from AMOS output is shown in Table 3(B) the results



the model is fit.

3.4: Environmental Concerns

To understand the level of participation of the respondents in pro environmental activities

environmental concern was tested on basis of 11 items. The responses were measured on a 5 Point


Likert Scale. The items were as follows: Participation in waste recycling if provided by respondent’s

community/society, public means of transport for travelling to and fro to office, Participation in rain

water harvesting, Participation in planting trees, reforestation and protecting public parks and the like.

The results were as follows:


Table 4(A): Results of Confirmatory Factor Analysis (Environmental Concern)

Name

of the

Variable

EN

VIR

ON

ME

NT

AL

CO

NC

ER

N

S.E.

Estimate

Standardised

Regression

Weights

Squared

Multiple

Correlation P

EC9 <---

0.626 0.392

EC10 <--- 0.233 0.727 0.528 ***

EC1 <--- 0.156 -0.272 0.074 ***

EC2 <--- 0.143 0.048 0.002

0.49

5

EC3 <--- 0.172 0.231 0.053

0.00

1

EC4 <--- 0.15 0.505 0.255 ***

EC5 <--- 0.162 0.523 0.274 ***

EC6 <--- 0.23 0.764 0.584 ***

EC7 <--- 0.149 0.605 0.366 ***

EC8 <--- 0.132 0.562 0.316 ***

EC11 <--- 0.128 0.08 0.006

0.25

3


Table 4(B): Results of Confirmatory Factor Analysis (Environmental Concern)

Model Fit Statistic

Chi-square 289.77



RFI 0.496



0.029

The standardized regression weights of each measured variable are shown in the table 3.4(A). The

results indicate that the most important way of showing concern towards environment is by converting

waste into energy which explains 76.4% of variation in the construct followed by communicating with

local government about environment issues like pollution of vehicles, noise pollution, waste

management and protecting eco system directly and indirectly which explains 72.7% of variation in

the construct.

The squared multiple correlations indicate the percentage of variance of the measured variable that can

be explained with the help of the variations in the construct. The squared multiple correlation of

converting waste into energy is .584 followed by communicating with local agencies is .528.

The statistics for goodness of fit of the model from AMOS output is shown in Table 4 (B) the results



the model is fit.

3.5: Knowledge about Environment Issues

Consumer’s knowledge about environment issues was judged on the basis of 11 multiple answer

questions and 9 close ended items with Yes / No options. The questions related to causes of water

pollution, soil pollution, smog, Global warming, depletion of natural resources, loss of species, air

pollution, depletion of ozone layer and the like. One way ANOVA was used to analyse if there is

significant difference in Environment Knowledge between males and females.

3.6: Environmental Attitude

Environmental Attitude was measured on bases of New Environmental Paradigm consisting 12 items.

Attitudinal variables included general pro-ecological attitudes, personal motives of frugality and

participation in community programmes, belief in the effectiveness of recycling, support of

government regulations to protect the environment. The items were like: balance of nature is very

delicate and easily upset, Humans have the right to modify the natural environment, Human kind was

created to rule over the rest of nature, when humans interfere with nature it often produces disastrous

consequences, Plants and animals exist primarily to be used by humans. We have responsibility to use

products which are made from recyclable material; we are approaching the limit of the number of

people the earth can support. When I have a choice between 2 equal products I purchase the one less

harmful to other people and the environment. Variables used in this study were measured on a

frequency scale of agree, undecided and disagree. Aspects like consideration for specific product

characteristics which are environmentally friendly before purchase (e.g. energy saving; recyclable) and

respondent’s practices related to recycling and conservation were also included.

3.7 Gender Differences and Green Purchase Behavior

For the statistical analysis of the questionnaires, SPSS 19.0 was selected because of its ability to

extensively analyse quantitative data. A one-way multivariate analysis of variance (MANOVA) was

performed to investigate gender differences in green purchase behaviour. Three dependent variables


were used: environmental knowledge, environmental concern and environmental attitudes towards

green purchase. The fixed variable was gender. There was a statistically significant difference between

men and women on the combined dependent variables: [F (18, 225) = 5.398, P< 0.05; Wilks’ Lambda

= 0.698]. Men reported higher levels of Environment Knowledge, environment concern and attitude to

Green Purchase. The results of MANOVA are shown in Table 5 below:

Table 5: The Multivariate Tests Conducted On The Combined Dependent Variables.

Table 6 Tests of Between-Subjects Effects

Source

Dependent

Variable

Type III Sum

of Squares Df Mean Square F Sig.

Model EC* 3145.277a 2 1572.639 1693.548 0

EA** 3811.012b 2 1905.506 2.71E+04 0

EK*** 198.368c 2 99.184 1109.601 0

GENDER EC 3145.277 2 1572.639 1693.548 0

EA 3811.012 2 1905.506 2.71E+04 0

EK 198.368 2 99.184 1109.601 0

Error EC 224.723 242 0.929

EA 16.988 242 0.07

EK 21.632 242 0.089

Total EC 3370 244

EA 3828 244

EK 220 244

a. R Squared = .933 (Adjusted R Squared = .933)

b. R Squared = .996 (Adjusted R Squared = .996)

c. R Squared = .902 (Adjusted R Squared = .901)

*EC=Environmental Concern

**EA=Environmental attitude

***EK = Environmental Knowledge

Table 7: Mean Scores

Descriptive Statistics

GENDER Mean Std. Deviation N

EC Male 3.64 0.776 88

Female 1.56 1.055 156

Total 2.59 0.962 244

EA Male 4.82 0.388 88

Female 3.03 0.159 156

Total 3.95 0.283 244

EK Male 0.91 0.289 88

Female 0.6 0.304 156

Total 0.85 0.298 244

An inspection of the estimated marginal means shown in Table 7 indicated that men reported higher

levels of environmental knowledge, concern and attitudes towards green purchase than women. Bray

and Maxwell (1982) suggest that if a significant MANOVA effect is detected, the follow-up test is to

Multivariate Tests

Effect Value F Hypothesis df Error df Sig.

GENDER Pillai's Trace .302 5.398a 18.000 225.000 .000

Wilks' Lambda .698 5.398a 18.000 225.000 .000

Hotelling's Trace .432 5.398a 18.000 225.000 .000

Roy's Largest Root .432 5.398a 18.000 225.000 .000


perform Univariate ANOVA for each dependent variable. To test whether the difference between the

mean score of environmental knowledge in men (.91) and women (.60) is statistically significant, one-

way ANOVA was used. The results (D.F. 1, P < 0.05) suggest that there is a significant difference

between men and women in overall environmental knowledge. This result implies that men are

generally more knowledgeable in environmental issues than women. This result provides strong

support for the first hypothesis. The result also corroborates the results of previous research conducted

in the West. For example, Arcury and Johnson (1987) found that the degree of environmental

knowledge was dependent on gender: men gave correct answers to the knowledge questions more

often than women. Table 3.7 shows also that men reported higher levels of environmental concern. To

test whether the difference between the mean score of concern in men (3.64) and women (1.56) is

statistically significant, one-way ANOVA was used. The results (D.F. 1, 225 = 276.229, P < 0.05)

suggest that there is a significant difference between men and women in overall environmental

concern.

This result implies that men are generally more concerned about environmental issues than women.

This result fails to support the second hypothesis. This result also contradicts previous research

conducted in the West (e.g. Davidson and Freudenburg, 1996). However, it should be noted that

whether women are, in reality, more concerned about the environment than men has not been

determined conclusively by empirical studies (Momsen, 2000). It appears that more analyses and

explanations are needed in this area. Finally, Table 7 indicates that men reported more positive

attitudes towards green purchase. To test whether the difference between the mean score of green

purchase attitudes in men (4.82) and women (3.03) is statistically significant, one-way ANOVA was

used. The results (D.F. 1, 225 = 359.388, P < 0.05) suggest that there is a significant difference

between men and women in overall green purchase attitudes. This result implies that men have

generally more positive attitudes towards green purchase than women. This result fails to support the

third hypothesis. It is also at odds with previous research conducted in the West (e.g. Tikka et al.,

2000). However, in a Canadian study Eagles and Muffitt (1990) found no environmental attitude

differences between the genders.

3.8: Intention to Buy Green Products

Consumer’s intention to buy green products was judged on the basis of 11 questions like if they would

like to buy less polluting products or switch to different brands because of ecological reasons or switch

to a green version of the product. Their opinion was taken on a 5 point likert scale.


(Intention to Purchase)


Table 8 (A): Results of Confirmatory Factor Analysis (Intention to Purchase)

Name

of the

Variable Estimate

Regression

Estimate

Squared

Multiple

Correlations P

ITP9 <---

INT

EN

TIO

N T

O P

UR

CH

AS

E

1

ITP8 <--- 0.569 0.265 0.145 0.032

ITP7 <--- 2.379 0.582 0.709 ***

ITP1 <--- 1.158 0.338 0.343 ***

ITP2 <--- 2.26 0.592 0.688 ***

ITP3 <--- 1.644 0.402 0.408 ***

ITP4 <--- 0.314 0.303 0.036 0.3

ITP5 <--- 1.93 0.496 0.395 ***

ITP6 <--- 1.958 0.498 0.334 ***

ITP11 <--- 1.581 0.433 0.353 ***

ITP10 <--- 1.538 0.405 0.38 ***

Table 8 (B): Results of Confirmatory Factor Analysis (Intention to Purchase)

Model Fit Statistic

Chi-square 256.78



RFI 0.745



0.225


Interpretation

The standardized regression weights of variables as shown in the Table 8(A) show that purchase of

goods packed in reusable containers explains more than 55% of variation in the construct, followed by

making special effort to buy environment friendly household chemicals and detergents as significant

factors in consumers intention to purchase Green Products.

The squared multiple correlations indicate the percentage of variance of the measured variable that

can be explained with the help of the variations in the construct. As shown in the Table 8(B), the

squared multiple correlations of intention to purchase products in reusable containers is .688. 68.8% of

the variance of this measure can be explained with the help of sources of information construct. The

squared multiple correlation of making special effort to buy environmental friendly detergents is .709.

Rest all sources are insignificant to explain the variation in the construct.

The statistics for goodness of fit of the model from AMOS output is shown in table 3.8 (B) the results



the model is fit.

Table 9: Testing of Hypothesis Using Chi-Square Analysis

Testable Hypothesis Chi

Square

Value

P Value Accept/Reject

1 H0: People with strong Environmental belief have

less knowledge about ecological issues.

H1: people with strong environmental belief have

more knowledge about ecological issues

292 .03 Accept

Alternate

Hypothesis

2 H0: Consumers with strong Environmental belief

have less concerned response towards ecological

issues.

H1: Consumers with strong environmental belief

have more concerned response towards ecological

issues.

290 .02 Accept

Alternate

Hypothesis

3 H0: Consumers concerned about the environment

do not tend to have pro environmental attitude.

H1: Consumers concerned about the environment

tend to have pro environmental attitude.

288 .003 Accept

Alternate

Hypothesis

4 H0: Consumers who tend to have pro

environmental attitudes do not show intention to

purchase.

H1: Consumers who tend to have pro

environmental attitudes show intention to

purchase.

280 .002 Accept

Alternate

Hypothesis

5 H0: Consumers with strong intention to purchase

are not likely to actually purchase green products.

H1: Consumers with strong intention to purchase

are likely to actually purchase green products

27.22 1.8 Accept Null

Hypothesis

The results of Chi Square analysis indicate that consumers with strong environmental beliefs have

Knowledge on Environmental issues, have concern for environment have environment friendly Habits

and have pro environment attitude but this is not reflected in their buying behaviour. On the basis of

the above analysis, some suggestions have been recommended in the subsequent section.

Section IV: Suggestions and Conclusion

4.1 Suggestions

4.1.1 Reduce the Attitude –Behavior Gap

There is a gap between articulated positive attitudes toward sustainability and people’s actual (mostly

unsustainable) consumption behavior. Although consumers say they are willing to buy “green”


products, only a few do so (Ehrich and Irwin, 2005). If left unaddressed, this gap will continue to

frustrate producers of sustainable product alternatives who rely on traditional, attitudinal market

research methods, only to find that actual demand often falls far short of their initial projections. This

limits the availability of sustainable product alternatives and thus limits movement toward more

sustainable consumption.

4.1.2 A Focus on Reducing Consumption

While prior research has attempted to identify and characterize the “green consumer,” less attention

has been paid to understanding the behaviors of people who focus on reducing their overall

consumption. While some choose reduced consumption because of a desire to “buy time” and to

improve their quality of life, others do so because of values such as concerns about the environmental

and social consequences of consumption (Shaw and Newholm 2002). At the extreme, some consumers

actively reject consumption, a phenomenon referred to as “anti -consumption” (Zavestoski 2002).

4.1.3 Consideration of the Full Consumption Cycle

More research is needed to better understand consumer’s full consumption cycle—not just initial

choice. Consumers’ post choice behaviors, including product usage, product life extension, and

disposal, all have a significant impact on the sustainability of consumption (Pieters 1991). For

example, how and how often consumers use products can determine the consumption of related goods

(e.g., fuel, accessories). How consumers maintain products has an impact on product life and,

therefore, product replacement. Decisions about when and how to dispose of a product, when disposal

can lead to alternate usage or another person’s use, also directly influence the sustainability of

consumption (Mannetti, Pierro, and Livi 2004; Ölander and Thøgersen 2006).

4.1.4 Expanding the Scope of Consumption Research

Researchers must also strive to expand the scope of their research. The majority of consumer behavior

researchers have focused on the consumption of packaged goods and other relatively low-involvement

products. A concerted push is needed for additional research on the consumption of major purchases,

such as automobiles, appliances, and housing—all of which have significant implications for

sustainability (Marell, Gärling, and Laitila 2009). For example, the purchase of a home has significant

implications both directly (e.g., energy use) and indirectly (e.g., commuting distance).

4.1.5 The Marketization of Politics and the Citizen–Consumer

Marketers and consumer researchers are not alone in framing people as consumers. Increasingly,

governments, media, and even environmental nongovernmental organizations address people as

consumers rather than citizens (Slocum 2004; Trentmann 2007). This “marketization” of politics has

led to the construction of the citizen–consumer in sociology and political science (e.g., Martens and

Spaargaren 2005; Soper 2007). The increasing marketization of politics influences people’s inclination

to assume responsibility for detrimental environmental impacts of their consumer behavior.

4.2 Conclusion

From environmental perspective, there is a need for public policies and establishing marketing and

business systems that encourage organizations and people to produce and consume within ecological

limits. This paper addressed opportunities for moving toward an era of green consumption. The focus

was on the value, belief, concern, attitudes and intention as main components of actual green buying

behavior and on how these components interrelate. To test this, we framed 5 hypotheses. These

hypotheses were tested using Confirmatory Factor Analysis. The results suggest that environmental

beliefs have direct effects on Environmental Concern, Environmental Habits and Environmental

Knowledge, the latter in turn influence Pro Environmental Attitudes and help in predicting green

buying behavior. To find the impact of gender differences on Environmental Knowledge, Concern and

attitude, Manova and Univariate ANOVA were performed for each dependent variable. The results

suggested that there are significant differences between men and women in overall Environmental

Knowledge, Concern and Attitude. Men reported higher levels of Knowledge on Environment issues

are more concerned about environment and have more positive attitude towards Green Purchase.


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Management of Occupational Stress in Indian Context

Dr. K. Sundar, Associate Professor, Commerce Wing, DDE,

Annamalai University, Annamalai Nagar-608 002, Tamil Nadu. India.

&

Dr. G. Ezhilan, Associate Professor, Department of Commerce,

Muthurangam Govt. Arts College, Vellore – 632 002. Tamil Nadu, India.

ABSTRACT

The stress on individuals ranges from personal day to day life to their organizational activities”.

Growing urbanization, industrialization and trigger stress. In this changing environment, participation,

interaction, transaction planning and regulation become stressors. People feel stress when they can no

longer have complete control over what happens in life. There is no escape from stress in modern life.

In today’s context, stress is a costly expense that affects both the employer and the employee. In this

back group, this paper examines the sources of stress in one’s occupation, the effects of stress and

techniques of managing stress. It concludes that the complete wiping out of stress is out of question.

The various strategies recommended for employees and the management are expected to help the

employees combat stress effectively. This write up appeals to the organization to be proactive in

addressing the stressful situation and any effort put in by any organization in managing the issue of

work place stress can have a dramatic impact on bottom line.

Key words: Burnout, Eustress, Relaxation, Stress.

Introduction

In the words of Susan L. Find Fred (1994) “Modern life is full of stress. The stress on

individuals ranges from personal day to day life to their organizational activities”. Growing

urbanization, industrialization and trigger stress. In this changing environment, participation,

interaction, transaction planning and regulation become stressors. People feel stress when they can no

longer have complete control over what happens in life. There is no escape from stress in modern life.

In today’s context, stress is a costly expense that affects both the employer and the employee.

In India, over half of the call centre employees have been experiencing stress at their work spot

and keep on quitting their work. The Canadian Institute of Health Information reports that over one

quarter of employees in the suffer from stress of different types. The Japanese Govt. which keeps track

of job related stress every five years has reported that a percentage of Japanase employees who

experience stress, anxiety, burnout in their work life has increased from 51 in 1982 to almost 70 during

2007. Most recently, more than 6000 UK firms paid an average of over 80,000 on stress related

damages to employees. Bill Challashan, Chairman of UK Health Commission has expressed that half a

million people a year report that they experience depression, anxiety or burn-out due to work – related

stress. Stress is an adaptive response to a situation that is perceived as challenging or threatening to a

person’s well being. The stress is a negative consequence of modern living. People are stressed

because of ‘certain causes like over work’ ‘job-insecurity’ ‘information overload’ and the ‘increasing

pace of life’. These events produce distress. Which strikes a persons psychological and physiological

well being and is associated with several work-related behaviour. There is also positive dimension to

stress called ‘eustress’ which connotes a healthy and positive outcome of stressful events.

Intense or prolonged stress can produce physiological symptoms like high blood pressure.

Ulcers, sexual dysfunction, headaches, coronary heart discase and so on. Behavioural symptoms of

stress include poor job performance, poor decision making, workplace accidents, higher absenteeism

and increased work place aggression. The stress reduces psychologically job satisfaction; increases,


moodiness, depression and job burn out. The Job-burn out means complete emotional exhaustion,

cynicism and reduced efficiency resulting from prolonged exposure to stress.

Thus stress is negative outcome causing enormous strain on physical and mental well being of

employees on one hand and financial resources of the organization on the other hand. Only a few elite

organizations address the issue seriously. Many do not have any formal process for tackling concerns

stemming from stress. Perhaps these companies do not fully understand its implications on various

performance dimensions of employees. Some employers do not understand the source of stress and its

manifestation in work spot. Some do not promote an environment where employees can express the

stress experienced by them at work spot without any fear of repercussions.

In this back drop, this write up deliberates on the issues and prescribes the remedies for

addressing the stress both at the organizational as well as at individual levels. Before taking up deep

deliberation a brief review of literature is made to find out the gap to be filled up by the current

researches.

Review of Literature

Beech (1984) in his research has concluded that job stress is a condition arising from the people

and their jobs and characterized by changes within people that force them to deviate from their normal

functioning. According to Arthur et.al (2001), personality characteristics such as authoritarianism,

rigidity, masculinity, femininity, extraversion supportiveness, spontaneity, emotionality and tolerance

for work ambiguity, locus of control, anxiety and need for achievement are particularly relevant to

individual stress. Thomas et.al (1979) proved in his research that the employees who served in the

credit card company experienced a high level of stress and cholesterol and became ulcer and arthritics

patients”. Cynthia E. Corder (1993) work addicts or work alcoholics are susceptible to burnout.

According to her, such of those employees in the helping professions like counsellors, heath care

professionals and social workers those controlling vehicular traffic, customer services representatives

and stock brokers are more likely get burnt out.

Joseph Seltzer (1979) views that when people are burned out, they are more likely to complain;

to attribute their errors to other and tend to be highly irritable. They feel alienated and the stress

experienced by them drives many to think about leaving their jobs and to seek out a opportunities else

where. Warriars (2004) in his research study on bank employees in South Tamil Nadu, India, has

unearthed the fact that higher dosage of technical infusion in banking industry has contributed to great

stress among the employees, Veeramani (2006) has established in his study on one hundred credit card

managers in a private sector bank that inability to achieve the target drives the employees crazy.

Pastonjee (1999) has identified certain organizational stressors namely work overload, ill-

defined authority-responsibility relationship, poor physical environment, non-transparent employee

evaluation, and poor performance reward in his study on one of the automobile units in Chennai city.

Robbins (2006) had recommended a slew of strategies to combat stress experienced by individuals at

work spot. They include meditation, breathing, walking are and relaxing. Pareek (1983) has traced the

sources of occupational stress in police department. Harrison (1976) has deliberated about the different

types of stress experienced by misfit employees Gupta (2008) has singled out the stress factors

responsible for employee attrition in BPO industry in India.

It is clear from the review that most of the literatures are addressing stress experienced in

western contexts. In view of a limited work done in Indian context, the present study addresses the

need for addition of fresh literature in the area.

Globalization has ushered in competition among the various players across the industries. The

various corporate entities in their bid to maintain or increase their market share in their respective

industries pressure the employees to realize their goals of different hues. Thus different types of

organizational problems lead them to different kind of stress. In this context, identification of


prominent stressors and application of right solution are important both in the interest of organization

and employees.

Discussion of Issues and Strategies

Stress stems from many different sources and can involve virtually all aspects of our daily

lives. This part of analysis, however, deals primarily with only two sets of factors that produce or

influence stress: those relating to aspects of organization and those involving personal characteristics

of individuals. Basically the discussion revolves around three sub-themes:

Sources of stress (occupational stress, in particular).

Effects of stress (including the impact on health and other work related behaviour).

Techniques for managing stress. McGrath (1976) observes that “There is potential for

occupational stress when an environmental situation is perceived as presenting the demands

which threaten to exceed the persons’ capabilities and resources for meeting it. The adverse

effects of stress, in general, are frustration, decreasing productivity, disease and early morality.

“American of Institute of stress estimates the work related stress costs American business about

300 billion every year”. Lydia Nathan (2008). This includes man-days lost; medical treatment and

deaths. It is more difficult to assess an indirect costs, which includes employees turn-over, alcoholism

and drug abuse. Given this, it become apparent that the estimate of 300 billion dollars will be a very

insignificant part of the total costs and that the magnitude of the problem phenomenal.”

Work we all do fulfils a number of basic human needs. It

provides income for survival;

provides purposeful physical and mental activity;

increases self-esteem and feeling of competence,

meets social needs;

actualizes talents and capabilities;

leaves behind some enduring creation;

earns reputation and wins recognition.

When there is a failure to satisfy these needs or when there is a perceived threat to their

fulfilment, a situation of stress arises. The extent or the nature of stress, of course, differs from person

to person and how he looks at it.

The diagrammatic representation of sources stress is given below.


Sources of Occupational Stress

Occupational stress falls into five broad categories which are discussed below:

1. Workload

Two sets of situations can exist i.e., ‘overload’ and ‘underload’. The overload can be

quantitative or qualitative or both. The situation of quantitative overload exists when the targets

assigned or deadlines fixed are unrealistic. Despite the workers being professionally competent to do

their jobs, the time restrictions generate stress. Qualitative overload takes place when the work

demands more than what the workers possess by way of technical and intellectual competence. The

effects of this stress are reported to be mental fatigue, headache and gastrointestinal disorders.

Aruthor Blanna Richard (2002) says that a combination of quantitative and qualitative overload

takes place mostly in higher administrative and managerial positions. Decision making at this level

relates to complex situations affecting the well-being of the organization, the people who work in it

and the society at large.

In the Indian context the major problem mostly is that of qualitative overload. It is only

recently that this has been given serious attention by way of training of personnel at various levels to

improve their competence and sharpen their professional skills. In Afghanistan for instance, the

commercial accounting system was introduced in Government departments on the recommendations of

a consultant from USAID when the country did not have even a single chartered accountant of its own.

The result was a total chaos of Government accounts and the resultant frustration among those who

were required to work on the system.

Under the underload situation, the job does not provide adequate reinforcement and the indices

of underload are monotony, lack of opportunities to use skills and expertise, repetitive performance

and high degree of specialization.

People sometimes even go to extent of committing suicide due to the stress of underload

syndrome involving absence of intellectual involvement and opportunities to use their specialized

knowledge.

Hans Seyle (1974) terms these problems “asdeprivational stress”. The most common

consequence of derivational stress is that the employees work at a minimally acceptable level showing

no real interest in work. It has been observed that wherever norms have been fixed (e.g. by the staff

inspection unit in departments like posts and telecommunications) the employees work just upto that

level and thereafter their involvement and commitment ceases.

2. Occupational Frustrations

Hindrances in the attainment of goals by job holder lead to stressful reactions. The important

components of occupational frustration and their effects are the following:

a. Job ambiguity: Saranya (1998) observes that job ambiguity arises when there is no clarity

of the nature of job reporting relationship is ill-defined and the precise lines of authority and

accountability are blurred.”

The cutting edge level of administration in India is district and sub-district level administration.

Unfortunately, it is at these levels that confusion abounds over the roles of various functionaries and

their accountability. There is multiplicity of development schemes with overlapping jurisdictions,

multiplicity of agencies responsible for their implementation with none to coordinate specifically and


everybody almost treading on the toes of others. There is also ambiguity about the role of the Collector

of the district. This not only jeopardizes the achievement of goals, but also results in frustration among

those responsible for implementation of schemes.

b. Role conflict: This situation exists when roles and responsibilities of workers directly

conflict with each other. This conflict is more at middle management level, which is sandwiched

between the senior and lower management levels. In such a scenario, there are conflicting job

demands, particularly when subordinates have to report to more than one supervisor and is entrusted

with unrelated group of activities. Smith Carilla (2001) “Conflicts also arise because of the problem of

conflicting policies, the personal aspirations, group needs and societal requirements.” The classic

example of role-conflict is the conflict between the line and staff officers. The line officers feel

hamstrung by the clearances required from the staff officers before any substantive decision can be

taken. The staff officers often do not feel themselves as an integral part of the organizational group.

c. High degree of specialization: “Specialization is necessary and good because it helps in

innovation, increasing efficiency and quality. But over-specialization is frustrating because the

individual concerned feels distanced from the end product, having too few opportunities to identify

with the organization, its policies and the services it renders or the goods its produces”, (Seward Brain,

2000).

d. Poor Career Development: Maran (2005) Stagnation in a particular grade and absence of

opportunities to upgrade the existing skills or pressure to acquire newer ones is the important stressors.

Reinforcement can be provided by formal training and counseling.

3. Occupational Changes

Whenever technological advancement is absorbed in any enterprise, workers used to the

existing technology undergo stress on adapting to newer technology. Similarly employees promoted to

higher cadres experience stress in the initial phase. Employees on the verge of retirements and after

retirement perceive a higher sense of stress when they are pulled out from their daily routines.

Many retirees don not live long in their post retirement life due to perception of loss of self

esteem, depression, loss of motivation general apathy, sleep disturbance and lack of appetite.

Therefore enterprises need to put in place the right measures to address the stress resulting from

aforesaid situations. As regards stress emanating from ever changing technical advancement,

employees may be given financial and non-financial incentives in acquiring new skills. As for retirees,

post retirement benefits sufficient to have comfortable living may be ensured.

Resick Patrician (2004) when a person is suddenly-pulled away from a reinforcing factor like a

steady employment, stress is quite natural. Therefore, a proper planning and psychological preparation

for retirement are strongly recommended by developing alternative sources of reinforcement e.g.,

hobbies, social contacts, financial security.

4. Stress of Accountability

In the opinion of Mason L. John, (2005), persons those as the higher level who are accountable

for others performance experience higher levels of stress. Feelings of tension and anxiety are often

reported by them. They are also more likely to suffer from diseases like ulcers and hyper-tension them

the actual performances. It may be pertinent to recall the experience that Baron Robbert (1983) has

undergone. In his own words. dollars, share holders, dividends, market changes all these are just

numbers. They bother me sure but the decisions that eat away at me are the ones that involve people. If

I have to lay off the father of a family or call someone on the carpet, i am a wreck for days”. The

aforesaid statement clearly reinforces the stress resulting from accountability for others performance.


5. Other sources of Occupational Stress

Other sources of occupational stress include physical environments (e.g. noise, lighting, etc.)

and interpersonal relationships.

Effects of Stressors

Walter B Cannon, an eminent Harvard physiologist recognized in 1920 the importance of

hormones and chemical mediators in body’s response to stressors. As the body prepares itself for

defence against stress or to avoid threat, three systems are most directly involved and the effects of

stressors thereon are summarized as under:

Cardiovascular system Heart rate elevated

Increased blood pressure

Increased heart rate variability

Coronory heart disease

Digestive system Increased stomach acidity

Loss of appetite

Reduction in the flow of saliva

Nausea

Ulcers

Muscular system Tense muscles

Tension headache

Tightness of chest cavity

Tension at the back of neck

Tension around the stomach

Back-ache

Hans Seyle (1974) introduced his concept of “Generalized Adaptation Syndrome”, meaning

physiological reactions brought about by a broad range of environmental stimuli. He regarded stress as

a non-specific response of body to any new demand on his energy, efforts, skill or existing knowledge.

It has three phases. In the first phase, i.e., Alarm phase, stress is generalized and is manifested

by increased activity in most of the body systems. In the second phase or, Resistance phase, adaptation

to stressor is localized to one or two bodily systems with little or no evidence of development of

symptoms. In the final phase i.e., Exhaustion Phase, the system or systems appear to be overloaded

with consequent development of symptoms and this phase can result in illness or even mortality.

It should be remembered that many of these problems are the product of many factors such as

genetic pre-disposition, excessive smoking over-use of drugs and high consumption of alcohol. Hence,

while these may be pre-disposing factors, stress may become a precipitating factor.

Personality factor contributes significantly to stressful reactions. Friedman and Roseman

(1974), categorized people into two days : type A and type B. We find that there are certain people

who always seem to work under pressure, and stay competitive and are both impatient and aggressive.

In contrast, there are others who are more positive in their approach, who are relaxed and easy going.

These two types respectively have been called type A and type B. Research shows that most of the

people in the united states actually seem to fall into one category or the other. Specifically, about 40

per cent of the general population is type A and 60 percent is type B (Byrne, 1981).


The peculiar traits of type A personality are the following:

An eagerness to complete.

A desire for recognition.

Quickness of physical and mental functioning.

Fierce driving towards poorly defined objectives.

Self-imposed deadlines.

Anguish at repetitive chores.

Multiple thinking and action.

Impatient at the rate of progress.

A sense of unease and guilt at relaxation.

The difference between type A and B persons have important implications for organizational

behaviour. Under hard-driving, competitive environment, individual would behave very differently

from those relaxed and easy going in any job-related activities. Further, type A and type B persons also

differ in other key areas like personal health, social relations and performance of many tasks.

Those showing type B traits experience less serious heart disease while type A category is

more likely to suffer heart ailments.

Type an individuals pay a very high price for their hard driving and for their high pressure life

style. The findings are that type A individuals have higher resting pulse rate than type B in a wide

range of situations. They react to several types of stresses (e.g. of threat of failure) with a larger

increment in blood pressure.

In the sphere of interpersonal relationship, these two types demonstrate a highly contrasting

pattern of social behaviour. Types A is more impatient with others and prefer to work alone rather than

as a part of the team. They are more irritable than type B.

Viewed in the context of organizational behaviour, type A persons appear to work faster on

many tasks simultaneously even if there is no pressure or deadline. Similarly, they generally complain

less about hard work than type B. They also appear to be better able to handle tasks involving multiple

demands than type B (Fazio et al, 1981).

On the other hand, additional findings suggest that Glass, et.al (1974) type A may not always

have the advantage. For example, they do more poorly than type B on tasks requiring delayed

responses. They are simply too impatient to wait (Friedman et.al 1974). More importantly, most

members of top management are type A and not type B. Several factors contribute to this finding. It is

possible that many do not live long due to health risks as they rise to the top levels. It is also possible

that disposition of impatience is incompatible with the skills (e.g., considered judgment) required for

effective functioning at top levels.

Strategies for Stress Management

Many different procedures for combating stress have been developed and these fall into two

major categories: personal strategies (approaches that can be adopted by individuals to their own

behaviour) and organizational strategies (i.e., strategies organizations can follow to minimize stress

among its employees).

The following are personal strategies for combating stress at work place.

A. PERSONAL STRATEGIES

1. Self-improvement and self-help are simple but effective techniques. These focus on physical

strategies as well as on psychological strategies.


2. Factors which increase physical fitness (e.g., exercise and good / balanced diet) help in

withstanding the adverse effects of stress. Physically fit people generally have better immunity

to disease than those who are less fit (Mataji, 2000).

3. Strategies based on psychological or behavioural factors are more in vogue now than in the

past. The one which has received the maximum amount of firm support from careful research is

“development of network of social support”. Persons who enjoy close friendly ties with others

are often able to cope with job-related stress in contrast to individuals who lack such support.

This is so because the former are confident of receiving help in times of need (Rose Julin,

(2003).

4. Another simple but effective technique is “plan ahead”. Generally people expose themselves to

unnecessary stress simply because they allow the stressful events to overtake them rather than

anticipate them in advance and devise measures to out beat them or to formulate protective

strategies to lesson their impact.

5. “Take a vacation”, “adopt a hobby” or “participate in enjoyable activities” are another set of

simple devices. Growing evidence suggests that such measures negate stressors greatly.

Persons most likely to benefit in this manner are those most in need of assistance i.e.,

individuals who recently experienced negative and upsetting life events (Resick Patrician JW,

(2004).

6. The next strategy is relaxation training. The attempt is to deal with stress through mastering

techniques that induce deep muscle and mental relaxation. The muscular over-tension disrupts

the adaptive functioning of various bodily systems. From the scientific point of view,

relaxation refers to the lengthening of skeletal muscle fibres, while tension refers to the

contraction or shortening of muscle fibres. There are some 620 skeletal muscles in the human

body (Beech et.al, 1984).

There are two distinct stages in the history of relaxation training.

The first phase began with the work of Burns, (2004) the recognized pioneer in the field of

relaxation therapy. He established the principle that relaxation is the direct physiological opposite of

tension or excitement; it is the absence of nerve muscle impulses.

The second phase began with Joseph Arnold, (1988). He produced experimental neurosis in

cats by evoking anxiety brought about by placing them in a restricted environment and administering

harmless but unpleasant shocks. The result obtained by Arnold was that there could be inhibition of

adaptative functions (e.g., failure to eat, impaired social activities, sexual inadequacies, etc.) if the

anxiety persists. Using similar reasoning Stephen, (1994) concluded that deep relaxation could be used

to inhibit anxiety evoked by fear arousing stimuli in humans.

The major benefits claimed for relaxation include:

1. More competent management of stress.

2. Elimination or amelioration of stress related problems.

3. Reducing the need to depend on stress inhibitors.

4. Significant reduction in anxiety level

5. Improvement in performance.

6. Removal of fatigue.

7. Increased level of self-esteem and self-assuredness.

It needs to be remembered that relaxation training is not a routine ritualistic and simple process

as it might seem to be. In fact, it requires a high degree of self-control, disciplined and regular practice

and it is only one of the many methods of controlling stress. L.E. Burns (2004) has developed a three-

stage technique of relaxation which aims at progressive muscle relaxation.


Meditation

Meditation is another technique for obtaining similar results. It has received a great deal of

popular attention in the recent past in the West as well. Many yogic techniques are also available and

have been practiced in our country from ancient times. The benefits claimed by this technique have

been well established and it has been adopted by millions throughout the world. In a sense, the basic

procedures are fairly simple. After assuming a comfortable posture, persons meditating close their eyes

and attempt to clear all disturbing thoughts from their minds. They silently chant the single syllable (or

mantra e.g., OM) over and over again.

The studies designed to investigate the effect of meditation have yielded the following

interesting results: Schultz, (1972)

1. Persons engaged in this practice report such positive changes as increased feeling of well-

being, higher reserve of energy and clarity of thought.

2. Meditation appears to produce important changes in bodily functions.

Wallace et.al (1972) obtained careful records of physiological reactions of 36 individuals

before, during and after meditation. Results indicated that 30 minutes of quiet meditation reduced the

subjects oxygen intake, lowered their respiration, increased the electrical resistance of their skin (a

change linked to reduced emotional arousal), and shifted their brain waves towards a pattern reflecting

calm relaxation.

Chakravorty (1987) of the Indian Institute of Management, Calcutta has developed a method of

“mind-stilling” and management of stress through what he calls the Sadhana way.

Any kind of stress-mental or physical – destabilizes vital energy or Prana. And the most

immediate and gross manifestation of this dis-equilibrium always takes place through our breathing

process. In Patanjali’s Rajyoga, the art and science of Pranayama was evolved. The Indian psychology

tells that not much can be achieved in this direction by confining oneself only to intellectual

knowledge. It calls for transintellectual approach. The approach suggested for daily life by Prof.

Chakravorty is that of Compose – Decompose – Recompose.

At the beginning of each day one should try to consciously compose oneself. During the day

we are involved in numerous activities, thoughts and reactions. This is decomposition of our beings.

We become thoroughly exteriorized. Therefore, at the close of the day, a planned and regular process

of recomposition becomes imperative.

The process of composing and recomposing can be attempted through breathing

exercises e.g., breathing from one nostril while keeping the other closed and breathing out from the

nostril other than the one from which the breathing took place.

B. ORGANISATIONAL STRATEGIES FOR COMBATING OCCUPATIONAL STRESS

Personal strategies for coping with stress differ greatly but they converge on one common point

i.e., enabling the individuals, through various techniques, to deal with stress when it occurs.

Organizational strategies minimize such reactions by removing causes that produce them from the

work environment. They range from changes in the organizational structure to changes in the nature of

specific jobs.

The origin of stress in relation to the jobs and the factors leading thereto have already been

analysed and therefore, the first requirement is to remove or minimize their occurrence. For example,

role ambiguities, unrealistic targets, lack of participation in decision making process, etc., are some of

the stress inducing factors and these need to be judiciously managed. Additionally, reinforcement

through positive factors should be provided and these in brief can be:


Both organizations and employees have to share a joint responsibility for effective management

of stress Healthy organizations invest time energy and resources in putting in place a system to spot

out the sources of stressors in the organization and take proactive measures to stop the feeling of

discomfort and inconvenience by employees from developing into organizational stress. The following

strategies are recommended in general for both proactive and reactive organizations for taking on

organizational stress.

1. Assess the Level of Stress

There is variety of ways to diagnose the level of stress affecting the employees. Surveying the

employees using a questionnaire can unearth a lot of facts relating to the level of stress experienced by

employees. Another way is conducting an interview with employees. Such interview may bring to light

a lot of emotional output of employees. But all employees may not be comfortable with such

interview. Alternately, organization can entrust job of diagnosis to consultants or stress management

experts who can simply observe the working style of employees over a period of time either at

individual level or at organization level and make valid recommendations. Besides, there are other

stress measurement scales developed by Human Resource Consultants namely French and Khan

(1962), Cooper, Sloan and Williams, (1988). These scales command a high reliability and validity.

These scales provide organizations point in times score card that can be used as bench mark indicator

for future measurement and growth.

2. Employee Assistant Programmes (EAPs) Many reputed companies offer counseling services to stress affected employees. Most EAPs

are broad – brush programmes that counsel employees on job – related as well as personal problems.

This mechanism helps the employees understand, acquire stress management skills and practise them.

3. Work Balance Initiatives

Companies have introduced a variety of strategies to help employees achieve work – life

balance in India. They include Flexi time options. job – sharing, telecommuting, child care support.

Flexi working hours: Some firms are flexible on the hours, days and amount of time

employees spend on working. Employees under this arrangement rearrange the work schedule to

accommodate family events, ranging from attending children’s school activities to caring for elderly

parents.

Job-Sharing: This arrangement splits career position between two people so that they

experience less time – based stress between work and family.

Telecommuting: This strategy reduces the time and stress of commuting to work and provides

employees with time to fulfill familial obligations.

Childcare Support: Nearly one quarter of US employees utilize onsite or subsidized child care

facilities. Companies in India have been providing these facilities. This reduces stress resulting from

taking care of their children during the working hours of employees.

4. Temporary Withdrawal Strategies

Keeping the employees off the stressful work climate for a temporary period by giving them

sabbaticals or paid vacation helps the stressed out employees to recuperate their lost energies and

return to work invigorated.

5. Wellness Programmes

Research indicates that physical exercise has potentials to reduce physiological consequences

of stress by relaxing their muscle tension lowering heart beat and arresting stomach acidity. Many

companies in India have put in place fitness centres to enable the employees keep in shape. Similarly

firms provide facility for meditation and provide advisory services in the matter of diet, nutrition,

regular sleep, sitting posture and other good habits. Park Place Entertainment Corporation in Los

Vegas recently introduced a wellness programmes in which its’ 19000 employees have a free access to

a wide array of wellness classes, individualized health appraisals with health and disease prevention

information. Even in India, all blue chip companies have been offering these facilities as a matter of


routine employee welfare measure. Generally all these activities normalise an individual’s heart rate,

blood pressure, muscle tension and breathing rate.

6. Social Support

Social support in an organization can be in the form of emotional support among the colleagues

through exchange of information or knowledge or in the form of actual help on the job, in addition to

one’s own work responsibilities. In this connection, firms can institute mentorship programmes either

formally by the organization or informally by like – minded individuals to facilitate their personal and

professional development. The mentors provide coaching and counselling to develop self awareness

among the stressed out employees.

7. Participative Management

Participative management allows employees to take part in decision – making so that there is a

sense of control over this jobs. Kaisen management, suggestions scheme. Quality circles, employee

empowerment, formation of autonomous work groups, brainstorming, joint consultative committees,

and so on are different forums that promote employee participation. It is one of the stress fighting

interventions increasing the value of employees and paving for higher employee productivity.

8. Physical and Well Being Facilities

Organizations are realizing the impact of work ambience that appeals to the restless

professionals of new millennium. Physical environment can be a strong overt expressions of an

organizations unique persona, influencing employee behaviour. A well lit office subsidized canteen,

gymnasium and sports facilities, ergonomic chairs and desks, sound proof walls, cubical provision of

state of the art office gadgets, devises and personal computers staff quarters, recreating facilities

supportive superiors, invited talks on matters of current importance, accident insurance, arranging get

together on important occasion, medicare facilities, tours, picnics, and so on are contributing overtly or

covertly in great measure to counteract the impact of occupational stress.

9. Delegation and Decentralisation

Job stress can be greatly reduced by decentralization i.e., dispersal of authority and

responsibility throughout the organization. This is particularly relevant in the Indian context where the

responsibility has been assigned to field functionaries but powers have been held back. The

constitution of autonomous teams would help in this direction.

10. Performance Management System

Through proper adjustment in the reward system, job-related stress can be avoided

considerably. Performance management system should be perceived as reasonable and the distribution

of rewards be seen as fair by the employees. There should be no arbitrariness in dispensing rewards

arising from predilections and subjective judgments of the superiors. The large number of cases

before the Central Administrative Tribunal and the high percentage of judgments going against the

Government show that a fairly large number of Government employees are not satisfied with the way

the HR policies in relation to areas like pay and promotion are being implemented. The performance

criteria, method of appraisal and results of review of performance should be transparent so that

employees concerned can know exactly where he/she stands in relation to others and what they should

do to climb the career path. This would counteract the stress experienced due to biased reviews.

A feeling of justice and fair play is supposed to debilitate the stress.

11. Sound Training

Improved techniques of training and placement of employees should be introduced to help

individuals perform their jobs with the minimum strain and to avoid mis-match between the persons

and the jobs.

12. Free Flow of Communication

The lines of communication within organization should be improved, so that information flows

in an uninterrupted fashion in all directions.

13. Change in the nature of job


A change in the nature of specific jobs can also aid in controlled stress arising out of mal-

adjustment e.g., boredom, monotony, etc. three-prolonged strategy is suggested i.e., job enrichment,

job enlargement and the skill improvement.

Conclusion

The write up has brought to the fore the fact that stress is taking a heavy toll on work force.

The different types of occupational stress and their impact on workers have been addressed. The

employee by pursuing various strategies suggested in the article can beat the stress to the maximum

possible extent. The strategies recommended for organization have the potential to stem the occurrence

of the stress. Last but not least, the modern day work practices are stress laden. The complete wiping

out of stress is out of question. The strategies suggested can certainly help the employees combat stress

effectively.

Many avenues are open to manage work – related stress. Some directly remove unwarranted

stress or remove employees from stressful environments others help employees alter their perception

of environment as stressful. Wellness programmes encourage employees to build belter physical

defences against stressful experience. Social support provides emotional, informational and material

resource to support and buffer stressful experiences. The cost of ignoring the impact of stress can be

very damaging to the growth of an organization. As the adage goes prevention is belter cure, the

organizations have to be proactive in addressing stressful situations. Eventually an organization’s

ability to effectively manage the issue of workplace stress can have a dramatic impact on bottom line.

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Aligning CSR With Human Resource Management – The Key Role of an

Organisation

Dr. A. Savarimuthu,

Dean, St. Joseph’s Institute of Management, St.Joseph’s College(Autonomous), Tiruchirappalli – 2.

Mr. M. Irudhayaraj*

Ph. D Research Scholar, Dept. of HRM, St. Joseph’s College, Trichy

Abstract— Human resource managers are well positioned to play an instrumental role in helping

their organization achieve its goals of becoming a socially and environmentally responsible firm – one

which reduces it’s negative and enhances its positive impacts on society and the environment. As

human resources influence many of the key systems and business processes underpinning effective

delivery, it is well positioned to foster a CSR ethic and achieve a high performance CSR culture.

The involvement of employee is a critical success factor for CSR performance. Human

resource managers have the tools and the opportunity to leverage employee commitment to, and

engagement in, the firm’s CSR strategy. High performing CSR organizations foster a culture of CSR

and fully integrate CSR throughout their operations, rewarding and incentivizing CSR decisions and

initiatives. Employees prefer to work for organizations aligned with their values; thus, incorporating

CSR into the employee brand can enhance recruitment and retention, particularly in tight labour

markets.

CSR can be applied to the HR toolkit, resulting in a roadmap or pathway for human resource

practitioners to follow the ethical code in the achievement of their organization’s sustainability and

business aspirations, thereby improving social and environmental conditions locally and globally.

Hence, this paper makes a conceptual analysis of the role played by organizations in aligning their

sustainability principles in to their core business functions with the help of a strong band of human

resources.

Keywords— Corporate Social Responsibility, Human Resource Management. Role of HR

Manager, Engaging CSR with HR.

I. INTRODUCTION

Perhaps a greater part of man’s early business history revolves around the monolithic object of

profit maximization and improving shareholders’ values. Because the benefits accrued to

shareholders/investors ultimately cascade to the society, some economic theorists assume businesses

do not owe the society more than economic responsibility. Milton Friedman argues that CSR distracts

business leaders from economic goals, and the only social responsibility of business is to increase its

profits. However, as the human society progresses and the nature of interrelationship and

interdependence between business and society become obvious, different interest groups began to

mount pressure on the business organization to assume more responsibilities for the society, beyond

the economic function.

CSR rests its assumptions on the fact that the organization is a creation of society; therefore it

has a responsibility to aid in the accomplishment of society’s goals. A company’s corporate

responsibility must be inseparable from its economic function and must be focused towards its

stakeholders. Professor Cohen considers the stakeholders as “All those who have an effect on a

business, and all those who are affected by a business”.1 The stakeholders in terms of CSR issues are:

managers, employees, customers, investors, shareholders, suppliers, government, the local community

and the society at large and even the natural environment. In fact, CSR commitment has been extended

to include both ecological sustainability and social development with focus on a ‘triple bottom line’


(economic, social and environmental) performance. The employees are the most strategic of these

stakeholders, and their involvement in CSR initiative impacts significantly on the organization’s

bottom line. “It is through employee actions and decision-making that many CSR strategies come to

life.

HR can be the key organizational partner to ensure that what the organization is saying

publicly aligns with how people are treated within the organization. HR is in the enviable position of

being able to provide the tools and framework for the executive team and CEO to embed CSR ethic

and culture into the brand and the strategic framework of the organization. It is the only function that

influences across the entire enterprise for the entire ‘lifecycle’ of the employees who work there – thus

it has considerable influence if handled correctly. HR is poised for this lead role as it is adept at

working horizontally and vertically across and within the organization, so important for successful

CSR delivery.

II. HR’s Role In Promoting Corporate Social Responsibility

With the growing importance of CSR in companies, HR professionals play a key role in

initiating, developing and sustaining CSR activities in the organization. While some companies have

separate CSR executives who are responsible for coordinating and managing events, most companies

expect HR personnel and other employees to invest their time and participate in such activities. In

today’s corporate scenario employees typically work for more than 8-10 hours a day and are expected

to multitask in their sphere of work. Given this hectic pace of work it‘s a challenge for any

organization to sustain CSR initiatives. Therefore, HR professionals have an indispensable role to play

in the areas of creating strong organizational culture aligning with core company values, fostering

relationship that is sensitive to the community culture, engaging every employee in active community

activities, and assessing the environment in order to identify threats to the community.

HR professionals need to co-ordinate the CSR activities and demonstrate company‘s

commitment to CSR. Effective CSR depends on being seen as important throughout an organization.

HR professional needs to include CSR in an organizational culture to make a change to actions and

attitudes and ensure the support of the top team which is critical factor to success. HR should

communicate; implement ideas, policies, cultural and behavioral change across organization. HR is

also responsible for the key systems and processes underpinning effective delivery.

The way a company treats its employees contributes directly to the company being seen as

willing to accept organizations wider responsibilities. Building credibility and trusting their employer

are being increasingly seen as important by employees when they choose who they want to work for.

HR manager should instill individual social responsibility in every employee in the organization. He

should make employees aware that every single person in the society has responsibility to the society

they belong irrespective of the job, class, caste or gender. HR should make employees think that only

when one fulfills or at least do the sincere attempts to do so, one can lead a complacent life in the

society. HR team can motivate the employees to contribute a certain amount or few hours in a period

of time to any organization worth. Even one can start with helping the needy in their neighborhood.

Human Resource Departments play a critical role in ensuring that the company adopts

Corporate Social Responsibility programs. Furthermore, HR can manage the CSR plan implementation

and monitor its adoption proactively, while documenting and celebrating its success throughout the

company. Human Resources technology can help with a Corporate Social Responsibility program,

including reducing the company‘s carbon footprint to benefit the planet. Start with these areas:

Implement and encourage green practices.

Foster a culture of social responsibility.

Celebrate successes.

Share and communicate the value of corporate social responsibility to employees and the

community.


III. The Basics Of Integrating CSR In to HR Management2

This guide has been developed recognizing the constrained economic environment of our

times; the tools and tactics proposed in this roadmap are those which can readily be integrated into the

HR practitioner’s daily regimen.

Step 1: Vision, mission, values and CSR strategy development Successful CSR requires a clearly articulated vision, mission and values. The HR practitioner

could initiate or support the development or upgrade, of a vision, mission and values of the

organization. The mission of a socially responsible HR Manager should specify that it will engage in

ethical and responsible business practices and seek to make decisions in particular HR practices that

balance the needs of key stakeholders, employees and society at large.

Step 2: Employee codes of conduct The HR Manager’s function is typically responsible for drafting and implementing employee

codes of conduct. As such, HR managers hold the pen on the principles contained in the employee

codes. Since a number of recent high profile corporate frauds, boards of directors have become very

concerned about the ethical culture within their organizations, looking for 100% sign-off on and

compliance with codes of conduct which articulate their ethical values.

Step 3: Workforce planning and recruitment Workforce planning consists of analyzing present workforce competencies; identification of

competencies needed in the future; comparison of the present workforce to future needs to identify

competency gaps and surpluses; the preparation of plans for building the workforce needed in the

future; and an evaluation process to assure that the workforce competency model remains valid and

that objectives are being met.

Step 4: Orientation, training and competency development Orientation is designed to set the employees in a direction that is compatible with the firm’s

mission, goals, and culture. Before training or development takes place employees proceed through an

orientation to learn what the organization stands for and the type of work they are expected to perform.

During the orientation process employees should be given a thorough overview of the clear line of

sight between the company’s vision, mission and core CSR values and goals.

Step 5: Compensation and performance management The most critical HR tool of all is the compensation and incentive program. The total reward

and recognition program, including base salary, incentive pay, long term incentives and other non-

monetary recognition benefits (such as award programs, employee of the month, promotions, career

path, etc.), needs to be aligned with the company’s CSR values and strategy. To do less is to guarantee

under-achievement of a company’s CSR objectives.

Step 6: Change management and corporate culture Companies have come to realize that innovation and independent thinking are the foundation of

a modern business. The advocates of HR practices must close the gap between what the companies say

and the reality of their actual performance. Goals and ambitions should be encouraged and companies

must mean what they say.

Step 7: Employee involvement and participation Employees are among the key stakeholders for the development of any CSR strategy or

program. A critical first step in mission, vision, values and strategy development is to understand the

key concerns, priorities and perspectives of all key stakeholders, particularly employees. In addition to


ensuring employees are included in key decisions, an employee CSR involvement and participation

program can help develop the employee value proposition that can foster retention and enhance

recruitment.

Step 8: CSR Policy and Program Development HR Manager is also in a position to drive policy development and program implementation in

HR areas that directly support CSR values. Wellness, diversity, work-life balance and flex-time

policies are CSR programs directly within the HR manager’s purview. Wellness programs can become

a platform for engaging employees in discussions about “personal sustainability” and provide support

for employees in the areas of stress management, spirituality at work, health and fitness, healthy

lifestyles, etc.

Step 9: Employee Communications Every CSR strategy requires the development and implementation of an employee

communication program to convey the corporate direction, objectives, innovation and performance on

its CSR efforts. Intranets, websites, blogs, wikis, social networking sites, podcasting, videos, forums,

town hall meetings, regular team briefings, webcasts, voicemails, print and electronic newsletters and

other forms of social media need to be deployed to bring the CSR message to the workforce – in ways

that are attuned to the communication channels of the employee, which are changing rapidly in this

age of web 2.0.

Step 10: Measurement, Reporting – and celebrating successes along the way! As what gets measured gets managed, it is vital that both CSR performance and employee CSR

engagement be actively measured and reported to executive, the board of directors and public.

Typically this is done in the form of an annual CSR report which demonstrates CEO and senior

leadership support. It provides verified performance data against HR practices along with social,

environmental and economic performance indicators. Objectively, both good and bad news are shared

and outlines goals for improvement. Often this report is verified by external auditors.

IV. Challenges In HR Involvement With CSR3

HR has to understand how CSR strategy is aligned to business and HR practices.HR has to get

endorsement for the CSR strategy from inside and outside the organization and communicate

consistently.

HR needs to ensure that their organization CSR can stand up to the inevitable scrutiny by stake

holders and that training and communication mean its embedded throughout the culture of an

organization

HR needs to be an active business partner working with other functions like finance, public

relations, marketing etc.

HR has to implement CSR as a strategic opportunity which should be market-led and It should be

restrained by bureaucracy. Because trust build through successful CSR is hard to regain if lost.

HR has to get the Top team on board and know how to sell benefits of CSR to different

stakeholders.

HR has to develop CSR code based laws and regulations of the country and also ensure that

reporting systems are accountable and transparent.

HR has to look for ways to leverage social responsibility initiatives internally. Communicate the

contributions company is making in the community and get employees involved.

The separation of employees during mergers, acquisitions, downsizing etc. should be strategically

aligned with the business strategy as well as Corporate Social responsibility. Retraining, retention,

redeployment of people can be worked out with aggressive communication, information campaigns

and outplacement services in place to assist the transition of people from the organization.


The Human Resource department should effectively measure and evaluate CSR activities. The

value added by CSR in the form of direct results, such as, economic savings and indirect results like

increase in employee satisfaction, less employee turnover, measured by staff attitude surveys, shall

indicate contribution to improved business performance. There is also a need to conduct periodic

review of the CSR activities.

V Benefits In HR Involvement With CSR

Generally, there is a growing desire among employees to derive a sense of greater purpose

from their work; happier employees with increased job satisfaction can unleash innovation in a

firm. The following list provides an overview of the key business benefits and economic value from

employee CSR engagement.

Increased retention and reduced recruitment and training costs A survey conducted for the Conference Board of Canada in 2000 found that 71% of employees

want to work for companies that commit to social and community concerns. In a similar Corporate

Citizenship study by Cone Inc. in the U.S., 77% of respondents indicated that “a company’s

commitment to social issues is important when I decide where to work”. A Scotiabank 2007 study

of employed Canadians concluded that 70% would consider changing jobs if their employers did

not operate in a socially responsible manner. With the replacement costs for the average worker

about $50,000 including lost output, recruitment, training and other elements, it pays for companies

to manage their CSR as well as their financial performance. Further evidence of the importance of

social and environmental performance management comes from a World Business Council for

Sustainable Development (WBCSD) publication, in which it was reported that “three-fifths of the

graduates and potential employees surveyed by Accenture in 2004 rated ethical management as an

important factor in their job search. And in the UK, 75% of professionals take social or ethical

considerations into account when changing employment, while over half of graduates will not work

for companies they believe to be unethical.4

Better able to attract the best and the brightest, especially amongst graduates The Aspen Institute’s 2007 study of MBA students found them to be expressing more interest in

finding work that offers the potential of making a contribution to society. Further, in a 2006 study

of 14 – 18 year-olds, 78% said money “was less important to them than personal fulfillment”. They

went on to work for “companies that promote equality, a green environment, and social

responsibility.” Even more remarkable, a 2003 Stanford University study Corporate Social

Responsibility Reputation Effects on MBA Job Choice found that MBA graduates would sacrifice an

average of $13,700 in salary to work for a socially responsible company. Some predict that the war

for talent will not be won through money, but through these intangibles.

Cost savings and income produced through improved employee morale and productivity It has long been known that a more motivated, engaged and inspired workforce produces higher

long-term productivity. A 2002 GlobeScan International survey showed that eight in ten people

who worked for a large company felt greater motivation and loyalty towards their jobs and

companies the more socially responsible their employers became. Another study, reported on in the

WBCSD publication revealed that 70% of staff who were committed to the values of the company

said that their productivity had increased in the past year while of those staff not committed to the

company only 1% had productivity improvements. Bob Willard, retired Canadian

telecommunications executive and well known CSR author and thought leader, has predicted that

companies can expect a 2% increase in employee productivity from improved company-wide

teaming around common sustainability issues that transcend departmental boundaries, and a 2%

increase in employee productivity from an improved work environment as a result of CSR. Further,

it is well understood that boosted employee satisfaction and performance leads to increased


customer satisfaction, generating a further win-win for CSR oriented companies. Brand research

reveals that in a study of customer behaviour, “8% of customers switching brands are lured away by

competition; in contrast, 68% are turned away by an employee’s indifferent attitude.” Engaged

employees are the company’s best defense against this Word – of – Mouth Virus. Employees

working for organizations aligned with their values are more likely to foster customer satisfaction

and loyalty. 5

VI Conclusion

It is a foregone conclusion that business enterprises have social obligations. Instead of single

objective enterprises are required to pay attention to multiple objectives like social, environmental,

information and ethical objectives all of which are integrated. Indian enterprises must graduate from

thinking in terms of just charity to the concept of respectability. More particularly, HR activities must

realize that neither office nor position gives immunity form responsibility. It is important to link HR

with external environment to chart out a better future for the society. “C” no longer stands for

Corporate and Cash, now it also includes Care and Community development as socially

responsible enterprises help in building a better tomorrow for the underprivileged. Companies

must earn respect and affection of the community through good deeds and enlightened HR policies.

Successful programmes on social responsibility rely heavily on enlightened people

management practices. In this context HR department is assumed to be the coordinator of CSR

activities in getting the employment relationship right which is a precondition for establishing effective

relationships with external stakeholders and thus can orient the employees and the organization

towards a socially responsible character. There is also an increasing trend in the corporate sector which

has started leveraging upon employees and their management for exhibiting their commitment towards

CSR. Armed with a strong and committed organizational culture reinforced by responsible Human

Resource Management practices, the organizations can achieve heights of success by improved

profitability, employee morale, customer satisfaction, legal compliance and societal approval for its

existence. It is high time for all other organizations which have been paying only lip service to CSR

that they must capitalize upon the existing Human Resource Department in framing such practices,

procedures and policies that ensure the internalization of quality, ethics and excellence in the whole

system. By doing this they can sensitize the employees and the whole organization towards CSR

without adding any additional cost.

To recapitulate it can be said that companies have increasingly felt the need to co-ordinate their

CSR activities and demonstrate their commitment to social responsibility. But delivery, not rhetoric, is

the key in developing the trust of external stakeholders for any organisation and it cannot be done

without beginning charity at home. To do that social responsibility needs to be embedded in an

organisation’s culture to bring change in actions and attitudes in which Human Resource can play a

significant role. Otherwise, CSR may run the risk of being categorised as shallow ‘window-dressing’.

X. REFERENCES

[1]Available:http://www.csrforhr.com/

[2]Available:http://corostrandberg.com/wp-content/uploads/.../CSR_and_HR_Management1.pdf)

[3]Available:http://www.mmbgims.com/docs/full_paper/14_MOHAMMAD%20KHALIL%20AHME

D_2_pp.pdf

[4]Available:http://CSR -an-Introduction.asp (accessed on February 8, 2009).

[5]Available:http://www.ic.gc.ca/eic/site/csr-rse.nsf/eng/rs00555.html


Qualitative Case Study:

Should entrepreneur’s believe, “LEADERSHIP IS INNATE”?

Dr. Dileep Kumar.M. , Professor- HRM/OB and Strategic Management, Othman Yeop Abdullah

Graduate School of Business (OYA-GSB), Universiti Utara Malaysia, Malaysia.

ABSTRACT

The issue of entrepreneurship and leadership is well discussed in the past and present. How far these

two terms related to each other is still a core debatable topic. Some says all entrepreneurs are born

leaders, while some other says; all entrepreneurs have to build up leadership qualities. While this

debate is going on a case study is conducted on a self moulded entrepreneur from Sultanate of Oman.

This case describe the journey of Mr. Hussain, as an entrepreneurial leader, gives many answer to the

above discussed aspects: leader-entrepreneur. The researcher followed sensitive case analysis method

to collect data and observe its validity and reliability. The debate of leader-entrepreneur needs to be

answered through the incidents Mr. Hussain has experienced across throughout his life. This is a real

case from the Sultanate of Oman. This is the journey of an entrepreneur who faced extreme challenges

and overcame struggles in business through common sense – “the sixth sense.”

HUSSAIN: THE ENTREPRENEUR

Family and early adulthood

Hussain was born in a poor family. His family consisted of four members. Those days, the sole income

to maintain his family came from Hussain’s father. He had a steel workshop, which was closed due to

his terminal illness. When his father got the terminal illness, Hussain didn’t have any option. To

support his family and his father he sold chocolates to the village community and in schools.

Chocolate sales as a small individual business was his first effort to enter into business. But whatever

money he got from his chocolate sales, he spent it for his father’s medicine and treatment. His

responsible attitude as a son to his family was moulded by the realities of life and the practical

situations from his childhood though it was a very much challenging task for a four-year old child who

had just started his journey of life. He went every day to the market to sell chocolates, sitting on the

ground. His shop was a piece of wood. He put his chocolates in front of him. He had no idea that this

would be his first step to his business career. However, due to these miserable circumstances, Hussain

did not enjoy his childhood as his peers did. He spent all his childhood time selling chocolates in the

market. During those years, not all students went to school. But, Hussain’s family sent him to school

and to the market at the same time. Studying and selling chocolates became one to Hussain. While he

was selling chocolates he continued studying and doing his homework.

When he reached the age of ten years, his father died. Despite his father’s death, he did not stop selling

chocolates. However, his father’s death was like a shock to him. The circumstances of life forced

Hussain to become the bread earner of the family as neither his mother nor anybody in his family had

any job. So, he worked seven days a week. The steel workshop was rented during his father’s illness

but the amount coming from the rented workshop did not meet the basic needs of the family.

THE CHANGE

During those days, the growth of Oman’s economy was at a low level as the government was involved

in developing basic infrastructures and had a long plan and way for proper development. The country

faced many barriers like lack of good roads, good drinking water, electricity supply,

telecommunication and poor technology and centralised decision-making. These turned to be barriers


to many business opportunities and starting new business ventures, whether on a small scale, medium

scale or big scale. On the other hand, Hussain’s small business was growing much faster than his

expectations. He faced a lot of challenges and witnessed many changes in his personal and

professional life. Hussain continued to sell chocolates with more vigour to provide more income for

his family. From a small market in the 1980s, he grew up to widen his knowledge about the market

sellers, the buyers, the good people as well as the bad ones. He got full respect from the old people in

the market as they knew his father’s circumstances. Circumstances further led him to many situations

in life. Due to the rising price index and low income he found it difficult to make ends meet. The

family situation became worse. Hussain turned to be impatient in his life, as the profit he was receiving

every day became too low and it was insufficient to meet the day-to-day needs. Sometimes he came

back home without selling a single bar of chocolate. Life looked at him very harshly. He became more

worried about his small business and family.

FINDING MORE AVENUES IN BUSINESS

Reading books was one of the unique habits Hussain had during those days. Even in the impatient days

of his life he used to read lot of books. This reading habit led his uncle to offer a book to him to read.

The book was much classical and provided entertainment to him. Although the book which was given

to him by his uncle was not for sale, he got an offer to sell it to an old man. Hussain sold the book at

double the price. Understanding the better prospects of getting more money from selling a book, he re-

bought two more copies of the same book. The surprising factor was within three hours, the two copies

were sold. He realised one thing from this selling of books: people were in need of good books. He

made a comparative analysis between these two products. He realized further that the total profit he

gained from selling three books was equal to two months’ profit he gained from the chocolate sale.

Considering the wide opportunity to earn more money, Hussain started selling books along with

chocolates. It was a good opportunity; he kept on buying books from the small hawkers or vendors

while maintaining the sale of chocolates. It seemed that people were attracted by the boy’s love to read

and sell chocolates. There was a stable growth in selling chocolates, but this could not gain that much

of his attention. Hussain stopped selling chocolates when he realized that the book profit was worth

more than the chocolate profit. Hussain distributed chocolates to the people in the market, but

everyone was surprised why he distributed chocolates freely. “I have a new business, I am a bookseller

now”. This was his answer to the people. With his creative way in the form of a celebration, he made a

marketing campaign for his new business. Hussain’s uncle was proud of the decision he made, the

profit he gained from the books, and because he was a good reader and trader at the same time. His

uncle noted his behaviour and the way he used to buy books from the vendors then sit on the market

corners and sell them quickly with double profit. Hussain had many books to sell, but he did not have a

shop to keep all those books. It became very difficult to carry home all those books everyday and

return with them the next day.

STARTING A BOOKSHOP

Hussain’s uncle was a moral supporter of all his best efforts in business and personal life. One day he

asked his uncle, “Why do only the old people have shops, why don’t we small kids have shops?” His

uncle replied, “Why not my son? But you already have a steel workshop.” Hussain was impatient to

tell his ideas to him. He further asked his uncle, “Can I convert the steel workshop to a bookshop?”

After being silent for a while and making a rough calculation, Hussain’s uncle replied, “With your

existing income, you cannot cover the steel workshop rent that you are going to lose if you utilise it as

a bookshop”. But, Hussain insisted that he could gain more profit in the future, therefore, he convinced

his uncle to support him and arranged to convert the steel workshop into a bookshop. Hussain’s uncle

was very much proud of his ambitious way, achieving nature and his sophisticated way of looking at

things differently.


FIRST BOOKSHOP IN THE VILLAGE

Hussain’s bookshop was the fi rst in the area. Hussain became the sole book seller in that market. He

had a good knowledge of all the available books in his bookshop. However, in those days, there was

no technology such as computers, where you could easily search for the data on books you would need

and get that information in seconds. Therefore, people depended mostly on their memories regarding

the titles of many books that could be easily sold in the market. As he was a good reader, customers

got surprised with his ability to reply many questions regarding any book in his bookshop. This ability

built better customer maintenance and relationship with the customers. He was not a good achiever in

school, but he was not so bad. He had a kind personality. He behaved like a sophisticated person with

his teachers. However, he knew his teachers as many of them used to visit him in his bookshop. Most

of his teachers became valuable customers, as they bought books as incentive prizes for the students.

THE SOCIETY SCHOOLS

Although the market was far away from the school, Hussain’s teacher knew that Hussain had a

bookshop in the market. Therefore, he gave him a mission to buy some gifts that were available in a

shop at the same market. Hussain bought the required gifts at a cheaper price than expected. Another

teacher heard about the cheaper price gifts. He asked him to provide him with the same ones. Hussain

started thinking, “Why don’t I provide such products in my bookshop?” As a result, Hussain provided

such products that were used as gifts such as notebooks, pens, pencils, etc. Since then, Hussain started

to satisfy all the school’s needs. In a few months, he became popular, not only in his school, but in

many other schools. Doing business properly required adequate storing space and a building. Hussain

faced a problem of space in doing business. Hussain’s uncle, however, had a plot of land on which a

store could be built. To build a store he needed at least OMR.15000. Finding an alternative for money,

Hussain signed a contract with his uncle to invest on the plot for 10 years in return for receiving the

plot with the ‘built store’ after ten years. Through this deal, Hussain was exempted from paying rent

for ten years. Certainly, there could be some risks in investing money for ten years while you are in

need of that money to develop your business. However, with his new stores, Hussain was able to buy

in bulk. He became the main supplier of books to many schools. Moreover, providing the schools’

needs led him to think of the students’ needs such as bags, rulers, erasers, and sharpeners. At this

point, Hussain succeeded in converting the bookshop concept to a wider concept where all the

schools’, teachers’, and students’ needs were met. Hussain was able to explore much more business

opportunities from the school by convincing his teachers to buy from his bookshop.

HOW DREAMS DIE FIRST: THE SUDDEN FIRE

Hussain was joyful with the incorporation of various school products like pens, notebooks, staplers,

and box fi les in his bookshop, which catered to the needs of the school children as well as the

teachers. Moreover, he got good profits as his bookshop became popular among the schools as well as

the parents. Unfortunately this success formula did not last for long. Due to an electrical short circuit, a

big fi re spread in the market, so more than 14 shops were totally damaged and Hussain’s bookshop

was damaged, too. Hussain was shocked when he heard the news. During those days, there was no

insurance company where people were secured against such disasters. He couldn’t fulfil his vision of a

better business and maximization of profi ts. All his keen efforts in the materialization of his dreams

faced a setback. However, Hussain, was well experienced in facing the challenges and coping with

those difficult situations with a more pragmatic outlook. All along, Hussain was continuing his

education with a business option. He was maintaining these the two activities equally well. Actually,

those were the days he wanted to complete his secondary education. He decided to concentrate more in

education for the time being, to complete his fi rst activity, where he had invested his energy and time.

Therefore, he stopped any action on the restructuring of the business till he finished his final exams.

The school management also felt sorry for the disaster that Hussain suffered. After he had finished his


final exams, Hussain reinvested his savings to restart the same business. Hussain found a good place

close to various schools and re-started his business of supplying educational goods. During the

following academic year, he got a huge demand from many schools as he became close to most of the

schools. Husain had two assistants to run the bookshop. The business started picking up once again.

He had come up with flying colors even in the midst of all turbulences in his life.

KNOCK ON THE DOOR FOR MORE OPPORTUNITIES THAN SIT IDLE

Meanwhile he applied to work in the government. The post of a store keeper has helped him a lot. He

could convince his sponsor to supply him with the needed Office stationery at a low price. His boss

was convinced with the idea. Furthermore, he convinced his friends in other ministries to get supplies

from the same bookshop at low prices. During that period, the market was slowly picking up. Such

products were sold in many places. There was no specific buyer for the stationery with a good system

in servicing orders and delivering products. Therefore, the bookshop became the only Office supplier

for the government offices. By that time, many government departments, offices, and companies

became valuable customers for the bookshop. The high growth in demand led to an expansion of four

times its first size, and it moved to a better location in the market. Obviously, with the old paperwork,

where the technology had not yet taken place, the work was overloaded for a sole proprietor of the

bookshop to handle a huge number of transactions.

THREE PROBLEMS LED TO AN OPPORTUNITY

The first problem was the overload capacity, the huge demand, and less staff that led to a decrease in

the customer-service quality. Many orders were fulfilled wrongly. Because they were involved in

serving customers, the staff could not focus properly on the orders received by phone and fax.

The second problem was price management. Hussain’s strategy was to purchase stationery in bulk

from Dubai. Although he could depend on others, he drove for five hours to Dubai on a weekly basis.

The third problem was that due to the increasing demand, he was unable to meet all the requests on

time. This was due to the lack of financial ability to lease appropriate storage to keep larger quantities.

The change of the bookshop concept from selling books only to cover all the educational purposes was

his main concern. The big demand created pressure in achieving this goal. However, he realized his

three problems, which could be summarized in three needs: managing customers’ orders in proper

ways, avoiding travelling to Dubai and finding another outsource to import the product, and making

use of the space in his big store. China was his new destination. This would reduce the cost of the

products and gain a good profit besides avoiding travelling to Dubai.But the big stores would ensure

extra cost, therefore, he started to look for a financing resource. Because of the lack of a guarantee

pledge, all his attempts failed. No bank accepted his application as he did not have any clear financial

position to borrow from any of them. He had 50 percent of the amount required to cover the purchase

in bulk from China as he planned. Therefore, he decided to somehow get hold of the money required.

When he failed to find financial support, he decided to sell the bookshop and the pickup truck. Due to

the bookshop’s good reputation in the market, Hussain sold it at a high price. Therefore, he did not

need to borrow from the bank. Hussain was able to know what the strength of his business was, who

his valuable customers were, and who his good employees were. Therefore, before selling the

bookshop, he convinced the dedicated and honest staff that he would soon reopen the same bookshop,

but with a new innovative look. Moreover, he looked at his customers’ records such as government

departments and companies. These records included all the addresses, phones and fax numbers,

people’s names, and types of products they would order. These aspects are considered as an asset to

any organization. He realized that without building a good relationship one would not gain profits.

Further he believed that building a good relationship would be possible only with valuable customers

and effective employees. Therefore, he repeated what he had done when he was a boy, when he


distributed chocolates and announced his new business. Therefore, he did pre-marketing to his

valuable customers.

He contacted his valuable customers and informed them of his new option of setting up a company

which specialized in stationery which would meet the needs of the entire market. It would be the first

company in this area.

THE RENAISSANCE

Husain established his new company for office supplies near the bookshop. He decided to leave his

job, as the new project would take all his time. He rented a small offi ce equipped with fax and

telephone, and he had two employees only. He found a appropriate store in a cheap location, not far

from the office, with two workers. This change reduced the cost to the lowest. Hussain started buying

stationery from abroad. His revenues and profits dramatically increased. The customer service was

well managed accurately by applying JIT techniques as the company focused only on wholesale

orders.

NEW CHALLENGE

His ex-bookshop did not last for long. It only lasted three months until it was closed due to a shortfall

in its income. The bookshop buyer did not realize the failure causes. Therefore, he sold it immediately

to cover part of his losses. The same loss scenario was repeated with the new buyer. The bookshop was

permanently closed. As he liked serving the education field he leased the ex-bookshop location but this

time at a lower rent because of the struggle faced by the previous buyers of the bookshop. He reopened

the bookshop but in an innovative way where he provided all the educational products required by the

individuals. He closed the new office and relocated it inside the bookshop for serving wholesale orders

only, and the bookshop served individual customers as well. This action served both types of

customers. Furthermore, all the products displayed in the bookshop shelves, facilitated the wholesale

buyers to see the products and test them before placing orders. This action provided another advantage

to the wholesale buyers, and reduced costs.

ADOPTION OF TECHNOLOGY FOR POTENTIAL BUSINESS GROWTH

Hussain improved the bookshop capacity by making use of the new technology that had just entered

the country. Computer with Windows95 was a solution to feed all customers’ data, accelerate the

delivery of customer’s orders, and get typed invoices. During those days, most of the offices were not

equipped with computers. Hussain was one of the first persons who brought this technology to his

bookshop. This reduced the time of every transaction they fulfilled. All the above innovative ideas

were the reasons behind his success. Hussain felt that he had achieved his dream as he was able to

convert the bookshop into a big company for office supplies. Hussain felt that he could provide new

office equipment such as photocopiers, printers, and other related devices. At this time, there was an

indication of growth in many industries. The business in high-tech products started to be promising.

Being one of the founders and contributors of the technological infrastructure base in Oman, it was a

good opportunity to develop his business.

SOLVING PROBLEM THROUGH A FOOLISH SOLUTION! “WEAKNESS MAKES

STRENGTH”

Hussain was also involved in other businesses ventures. He was busy and he could not run his

business. Therefore, he preferred to delegate and hand over all his responsibilities to his son who had

just graduated. His son had a degree in Business Administration, but he did not have any experience.

Hussain’s son was ambitious, so he immediately started an expansion strategy without having a proper


study of the financial recourses, human resources, operational knowledge and market intelligence. He

signed post-dated cheques to many companies. He was unable to provide sufficient funds as the sales

dramatically were decreasing to the lowest level. The company went from bad to worse. Hussain was

informed about the matter, and he reacted positively to the matter. He immediately reflected on his

success. He learnt from his accumulated experiences that his weakness was the resource of his

strength. Therefore, he did not panic as he was sure that there should be some solution to the problem.

RISK MANAGEMENT

Hussain’s bank balance was enough to solve his son’s problems, but he refused to help him. Instead,

he joined him in Dubai to attend a businessmen’s conference. This was another business opportunity

that Hussain was looking forward to. There were a few traders who attended that conference. They met

representatives from the Xerox Global Solutions (XGS) Group and many other companies. Hussain

and his son looked for business opportunities but due to his son’s financial problem, they could not

attract any partnership opportunity. Therefore, they signed agency agreements with many companies.

However, most of the companies agreed to deliver their products to Hussain in return for post dated

cheques. “How do you sign other postdated cheques?” We have 24 cheques returned due to

“insufficient funds” for a total of OMR.175000,” Hussain’s son asked. “That is true but this is another

opportunity son, and there is a good demand for such products and our expansion will have reasonable

justification” Hussain confidently replied. Hussain did not wait to solve the existing problem. Instead

he came with a foolish idea as his son and many people might have seen. Hussain made use of all the

expansion and his son prepared to enhance the new opportunity. Due to Hussain’s good knowledge, he

took a high risk as he had struggled in the company due to lower growth in sales, liquidity problems

taking place, and many postdated cheques returned due to insufficient funds. Hussain successfully

investigated the matter and realized that recruitment was not fixed properly, especially in the

marketing department. Therefore, he made many changes in his company aiming to improve its

marketing efficiency.

THE SUCCESSFUL STEPS OF A LEARNED ENTREPRENEUR

Hussain evolved a performance-basis structured programme for the salesmen in the company. This

programme showed remarkable growth. In a few years, he achieved extraordinary growth. As a result

he gained respect from many companies and manufacturers. Hussain became a major supplier of

stationery and office supplies, photocopy paper for every brand of copier, printer, and multi-function

devices. A few years later, another expansion took place and the company was awarded the Quality

Certificate ISO 9001:2000. Today, the office is an agent of many international IT, and office

technology giants such as, Xerox Brother International, Lexmark, Kodak, Benq and Optoma. Today,

the company provides the following services: office supplies, production printing, copying, graphic

arts, and document management technology, fax machines and the P-Touch labelling systems used in

offices and homes. The company provides both types of printers for Network and Wi-Fi. The company

has different products whose prices range from the cheap home printer to the sophisticated home/office

devices. The company offers digital LCD projectors, audio and video conferencing by Konftel. It

provides a range of screens, PA systems, and Smart. These are just examples of the companies which

Hussain’s company deals with. Today, customers expect ease of use, less consumption cost, reliability,

excellent services and professional maintenance support. Hussain always provides solutions that

exceed all expectations. Hussain was able to attract the Xerox Global Solutions (XGS) group. This

group outsourced solutions for Archiving, Enterprise and Digitizing Document Management Solutions

(EDMS), providing innovative Enterprise-wide total solutions for all needs. Hussain was able to bring

the Access, Security, Control and CCTV with products and support from Bosch, Gallagher, Zicom,

Miditec, RCS, and a host of other international specialists in Security and Time & Attendance systems.

Hussain became a well-known person worldwide, American Science and Engineering, AS & E

manufactures, patented the Z-Backscatter Technology. It has a range of surveillance vehicles with


baggage scanners that are capable of detecting metals. Hussain was able to bring specialty to the

company though the Point-of-Sale field (POS) solutions. His partner was VeriFone, the world’s largest

manufacturer and supplier of POS solutions. All major banks and the petroleum retailers are the

customers receiving Verifone Terminals and solutions in Oman. Hussain Service and Customer Care

network is expanding and is available in many states. Oman’s such as the capital area, Sur, Nizwa,

Sohar, and Salalah each have a branch. The company has developed an extraordinary customer base in

the government and private sectors and has earned client loyalty.

Today, Hussain has become an icon in the business for both entrepreneurial and leadership fields. He

is the CEO of the Oman Cable Company. In addition, he has an ownership in many companies and has

board memberships in many companies.

PREPARATORY REFERENCES:

[1] Brockhaus, R, H. “Risk Taking Propensity of Entrepreneur”. Academy of Management Journal,

vol. 3 no. 3, pp. 509-520, 1980.

[2] Drucker, P. F. Tasks, responsibilities, practices. New York, NY: Harper & Row, 45, 1974.

[3] Hisrich, R.D., Michael P. P. & Shepherd, D. A. Entrepreneurship. 6 eds. New York: McGraw-Hill

Irwin, 2005.

[4] Knight, G. “Entrepreneurship and marketing strategy: The SME under globalization”. Journal of

International Marketing, vol. 8, no. 2, pp. 12-32, 2000.

[5] Koh. Testing Hypothesis of Entrepreneurial Characteristics, A Study of Hongkong MBA Students.

Journal of Managerial Psychology, vol. 11, no. 3, pp. 12- 26, 1996.

[6] Lee, S.M. & Peterson, S.J. “Culture, entrepreneurial orientation, and global competitiveness”.

Journal of World Business, vol. 35, no. 4, pp. 401-16, 2000.

[7] Naman J.L. & Slevin D.P. “Entrepreneurship and the concept of fit: A model and empirical tests”.

Strategic Management Journal, vol. 14, no. 2, pp. 137-153, 1993.

[8] Okpara, F. O. (2000) Entrepreneurship (Text and Cases). Enugu: Precision Publishers Ltd.

9] Peters, T. W. & Waterman, R. H., In Search of Excellence, New York: Harper & Row, 1982.

[10] Richard L. O. “The essence of entrepreneurial success. Management Decision”, vol. 33, no. 7,

pp. 4 – 9, 1995.

[2] Say J.B. (1803). In Nagarajan (2009). “Nagarajan A History of Entrepreneurship”. International

Journal of Business and Social Science, vol. 2, no. 9. [Special Issue - May 2011]

[2] Soyibo, A. “The Concept of Entrepreneurship.” In: Mike D. (2011). “Entrepreneurship

opportunities and challenges in Nigeria”. Business and Management Review,vol.1 , no. 1,pp. 41-48,

March, 2011.

BOOKS FOR ADDITIONAL READING

[1] Charles, E. B & Garry, D. B. Entrepreneurship: A Small Business Approach. Mc Graw Hill

International Edition.New Yor, 2011.

[2] Cynthia, L. G. (2007). Entrepreneurship: Ideas in Action. South Western Cengage Learning.

Mason, USA, (2007).

[3] John, B. & Joe, T. Innovation and Entrepreneurship (2nd

Edn). John Wiley and Sons Ltd, 2011.

[4] Thomas, W. Z. & Norman M. S. Essentials of Entrepreneurship and Small Business Management.

International Edition 3rd (Edn). Pearson Education, New jersey, 2002.

[5] Silke S. (2009). The Entrepreneur as Business Leader. Edward Elagar (EE) publication.

Northampton, MA. UK, 2002.


A Study on Import Scenario of Colored Gemstone and Diamonds in India

Dr.Kalpana Agrawal, Assistant Professor, Prestige Institute of Management and Research

Mitisha Agrawal, Prestige Institute of Management and Research

Abstract

Gems and Jewellery is being consumed by Indians for ages for its aesthetic as well as investment value

and also form an essential part of the tradition .We import rough diamonds, cuts and polishes them,

and then exports them. Gem and jewellery sector which is a powerful engine, driving India's export-led

growth. As per the latest import-export statistics released by the Gems and Jewellery Export

Promotion Council (GJEPC), imports of polished diamonds declined by huge 59% to $944.93 million

by value, and by 52% to 1.966 million carats by volume in January 2012 compared to same month

previous year. Last year, the import of polished diamond in January 2011 was $.2.2 billion in value

and 4.7 million carats in volume. While, polished diamond export in January-2012 fell 19% year-on-

year to $1.7 billion and declined by 37% by volume at 3.32 million carats compared to the same month

in previous year. On the same time, rough diamond import increased by 7% to $1 billion in January,

while the rough exports surged 45% to 153.27 million compared to the same month in previous year.

The present study is an attempt to comprehend the import scenario of colored gems and diamonds in

India and to observe their future import trend in India.

Introduction

A gemstone or gem (also called a precious or semi-precious stone, a fine gem, or jewel) is a piece

of mineral, which, in cut and polished form, is used to make jewellery or other adornments. However

certain rocks, (such as lapis lazuli) and organic materials (such as amber or jet) are not minerals, but

are still used for jewelry, and are therefore often considered being gemstones as well. Most gemstones

are hard, but some soft minerals are used in jewelry because of their luster or other physical properties

that have aesthetic value. Rarity is another characteristic that lends value to a gemstone.Jewellery is

made from variety of material. Jewellery can be carved out of stones or made from various other

minerals and metals. Jewellery are also rare pieces of belongings and their value is derived from the

material used like gold, silver , platinum etc and also the stones like diamond , ruby , sapphire , quartz

etc. Jewellery has been in use since ages. India being a very old and rich country was also known as

‘the golden bird’. Since India was ruled by many rulers if different cultures and also India was invaded

by many countries, their impact can be seen on the Indian jewellery.

India is a leading player in the global gems and jewellery market. The gems and jewellery industry

occupies an important position in the Indian economy. It is a leading foreign exchange earner, as well

as one of the fastest growing industries in the country. The two major segments of the sector in India

are gold jewellery and diamonds. Gold jewellery forms around 80 per cent of the Indian jewellery

market, with the balance comprising fabricated studded jewellery that includes diamond studded as

well as gemstone studded jewellery. Major portions of the rough, uncut diamonds processed in India

are exported, either in the form of polished diamonds or finished diamond jewellery. The Indian gems

and jewellery industry is competitive in the world market due to its low cost of production and the

availability of skilled labor. In addition, the industry has set up a worldwide distribution network, of

more than 3,000 offices for the promotion and marketing of Indian diamonds. The Indian diamond

industry has the world's largest cutting and polishing industry, employing around 800,000 people

(constituting 94 per cent of global workers) with more than 500 hi-tech laser machines. The industry is

well supported by government policies and the banking sector with around 50 banks providing nearly

$3 billion of credit to the Indian diamond industry


Review of literature

India has always excelled in the field of diamond cutting, gem cutting, polishing and processing.

India’s diamond tradition goes back thousands of years and is one of the oldest in the world. In fact, it

was reported that diamonds were discovered by India and were the only source of diamonds until

1730s. At present, India is one of the world’s leading diamond cutting and polishing centers in the

world. According to USGS data , diamond production ( gem and industrial) in India in the year

2007 Was 55 thousand carats and has remained more or less stagnant over the years. As per United

Nations Framework Classification (UNFC) system, as on 1.4.2005, India had total resources of around

4.5 million carats, of which 1.2 million carats was reserves. By grades, about 17%of resources are of

gem variety, 18% are of industrial variety, while bulk of the resources (65%) is placed under

unclassified category. Andhra Pradesh accounts for 40% of diamond resources, followed by

Madhya Pradesh and Chhattisgarh (28%) .Gujarat is one of the major states in India promoting gems

and jewellery sector as one of the thrust areas for development . Gujarat having the largest human

resource pool in the country in diamond cutting and polishing, accounts for 80% of the total diamonds

processed in India. India imports rough diamonds and process them for value addition and exports. As

a result, India is a net exporter under this category in value terms .India exported diamonds valued

US$ 14.2 billion during 2007-08, an increase of 34%over the previous year. India imported diamonds

valued US $ 7.7 billion in 2007-08; during t h e year 2008-09 , the imports increased by 110% from

US $ 7.7 billion to US $ 16.3 billion. In the case of diamond exports, major destinations include: Hong

Kong (30.1%), UAE (22.5%), USA(17.6%), Belgium(11.4%) and Israel (5.0%). As regards diamond

imports, Hong Kong (27.6%), UAE (25.6%), UK (6.4%), and USA (4.8%) were the major source

countries for India.

Precious Stones

Gems or precious stones have fascinated mankind since ancient times. Precious stones are not only

adorned as the items associated with royalty, they are considered as valuable gifts along with gold. The

role played by precious and semiprecious stones in Indian mythology and society is well-known. In

India, people, for astrological reasons, have used gems as they are considered to be influencing various

planetary positions, which in turn are believed to be influencing human life cycle and human destiny.

Gems are also used in preparation of some ayurvedic medicines .

Indian gemologists have identified around 84 precious and semi -precious stones, amongst them 9

stones namely: Ruby, Emerald, Pearl, Diamond, Red coral, Zircon, Blue sapphire, Yellow sapphire,

and Cat’s Eye, form the ‘Navratnas’ or nine gems. India was more an exporter of precious stones than

an importer of the same, and the difference between these two being minimal. During 2007- 08, the

exports of precious stones were US $ 280.8million, an increase of 6.5% over the previous year, and in

the year 2008-09 , exports of precious stones witnessed a marginal decline of (-)0.1%, over the

previous year. Import of precious stones has grown marginally; during the year 2008-09 imports grew

by 4.6% over the previous year. The source countries for colored gemstones include Thailand (23.3%),

Hong Kong (19.1%), and Zambia (13.9%). In the case of articles of precious stones other than

diamonds (natural/ synthetic), the major export destinations include: USA (38.8%), Germany (23.9%),

and Switzerland (9%), and the source countries for the same include: Hong Kong (27.8%), Sri Lanka

(22.2%), and Germany (16.7%).

Rationale of the study

The gems and jewellery sector has been one of the fastest-growing sectors in India in the past few

years. The sector has gained global popularity because of its talented craftsmen, its superior practices

in cutting and polishing fine diamonds and precious stones, and its cost-efficiencies.


The gems and jewellery sector in India is engaged in sourcing, manufacturing, and processing, which

involves cutting, polishing and selling precious gemstones and metals such as diamonds, other

precious stones, gold, silver and platinum. The past and present statistical data will a provide a

platform for colored gems and jewellery from India. This study will explore the trends being

undertaken in import of colored gemstones in India.

Objectives of the study:

To analyze the present import scenario of colored gemstone in India.

To forecast the future trend of import of colored gemstones in India.

To analyze the present import scenario of diamonds in India.

To forecast the future trend of import of diamonds in India.

To do the SWOT of the Industry.

Research Methodology

The universe of research was IMPORT POTENTIAL OF COLORED GEMSTONES IN INDIA. The

period of study was from 2002 to 2011 spanning 10 years and future predictions for next 5 years. The

study was descriptive in nature and was based on secondary data. The data was collected from various

secondary sources like books, journals, trade journals, internet sources, official websites like

commerce.nic.in, etc. Descriptive statistics along with trend analysis was used for forecasting.

The Study

The study is analytical in nature and it aims to know the import potential of colored gemstones and

diamonds in India.

The Sample

The sample includes the import data collected through the secondary sources for the period of last ten

years (2002-2011).

The Tools

Tools for data collection:

Secondary data was used as a source of data collection. It includes internet, trade journals, official

government websites and whichever applicable and usable in the study.

Tools for data analysis:

The data for the period 2002-2011 depicting the import of colored gemstones and diamonds in India

were analyzed using Trend analysis method.


Results :

Table 1.1 Shows The Trend Values of Import Potential of Diamonds.

Source: Ministry of commerce, government of India (www.commere.nic.in ), import of diamonds

Graph 1.1: Shows total import value and trend value of import of diamonds.

0

5000000

10000000

15000000

20000000

25000000

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15

Year

Total import

Trend Value

Year Total Import Trend Value

2002 2163607.0 2099770.764

2003 2893489.0 2481916.738

2004 3227394.0 2933611.041

2005 4179216.0 3467511.059

2006 3964639.0 4098577.752

2007 3309165.0 4844494.884

2008 3124589.0 5726164.564

2009 7845161.0 6768292.959

2010 7440230.0 8000082.614

2011 15274190.0 9456050.769

2012 11176996.595

2013 13211144.477

2014 15615495.353

2015 18457423.998

2016 21816567.004

http://www.commere.nic.in/


Table 2: Trend Analysis of Import of Colored Gemstones

Source: ministry of commerce, government of India (www.commere.nic.in ), import of colored

gemstones.

Graph 2: Shows total import value and trend value of import of coloured gemstones.

Discussion

Comparing the increase and decrease in value of imports of diamonds, we find that in case of

diamonds there was decrease in import’s value in 2006 followed by further decrease in 2007, 2008

.This decrease was seen due to decrease in disposable income of people which affected the internal as

well as the external demand, also the increase in gold prices and the global credit crunch added to the

same. An increase of more than 50% was marked in the year 2009due to initiatives taken by

government like policies to reduce import barriers and projects to increase exports and employment

generation programmes, but again a declining trend was observed in 2010 as the result of hike in gold

prices. Again an increasing trend was observed in import by approx 50% in 2011. It is expected the

import of diamond then to increase gradually in coming years.

0

20000

40000

60000

80000

100000

120000

140000

160000

180000

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15

Year

Total Import Value

Trend value

Year Total Import Value Trend value

2002 37426.2 29151.485

2003 37133.47 38204.127

2004 42386.93 47256.770

2005 49181.05 56309.412

2006 73897.08 65362.054

2007 73338.46 74414.697

2008 76526.76 83467.339

2009 91335.53 92519.981

2010 97344.98 101572.624

2011 120313.3 110625.266

2012 37426.2 119677.908

2013 128730.550

2014 137783.193

2015 146835.835

2016 155888.4778

http://www.commere.nic.in/


In case of gemstones, an increase in import of gemstones is seen upto 2011due relaxation in import

policy by government, increase in price of gold and diamond jewellery made jewellery of

semiprecious stones more attractive to common people. The import value of colored gemstones is

expected to increase in coming years.

From 2009, a change was observed in Indian culture , the people became more fashion conscious, and

became more aware of astrological importance of gemstones,also the consciousness of the status and

the willingness to spend larger amounts became the major factor that affected the import potential of

precious and semi precious gems and jewelleries.

As a result, the prospects for an increase in imports of gold jewellery studded with gems and diamonds

studded gold jewellery got increased considerably. So the significant changes were observed in import

values of gems as the branded jewellery studded with gems gave ample beat to the family jewellers.

The Indian gems and jewellery industry has provided its mettle in international competitiveness.

Simultaneously, it has also made significant socio economic contributions:

1. Employment generation with low investment: The investment required for creating employment

in the diamond processing and jewellery making units is quite low. Employment generation in

other industries call for heavy investments.

2. Hard currency foreign exchange earnings: The countries to which India exports gems and

jewellery are among the hard currency areas. The industry contributes continuously to the

country’s foreign exchange reserves.

3. Pollution-free industry: diamond processing and jewellery manufacture do not pollute the

environment, neither air nor water.

4. Environmental friendly industry: being an import-based industry it does not deplete natural

resources and also leaves the flora and fauna intact.

5. Assists in urban decongestion: through decentralized location, the gems and jewellery industry

helps in the removal of unemployment in the rural sector, prevention of migration to cities and

the avoidance of slums in the urban areas.

6. Low power consumption: the gems and jewellery manufacturing processes do not aggravate the

country’s energy problems.

7. No burden on the country’s transport infrastructure: the raw materials as also the finished

products are of high-value but of low weight. They do not put any burden on the country’s road,

rail, sea or air transport.

SWOT ANALYSIS

Strength

Gems and jewelleries is one of the identified developmental category of products in which

government is willing to invest lots of capital and energy to upgrade this industry.

A wide pool of skilled labour are engaged in adding values in the raw gems and stones.

The total cost of finished gems and jewelleries is less because of cheap labour cost.

Another advantage to India is nearness to Afghanistan from where low cost import of precious

stones is possible.

Import free machinery, raw materials and input are allowed.


India can import duty free diamonds.

State’s liberal policy.

Continuous emphasis is given on training and skill development of young craftsmen.

Various incentives are offered to importers of jewellery manufacturers so that they expand their

business in faster manner.

Indians are specialized in traditional jewelleries and also is handicraft items, thus they import

raw gems and precious stones and add value in it and export them.

When we talk about craftsmanship, Indian labours are producing jewelleries of much smaller

sizes and the quality of cutting is incomparable in the world.

Raw gems, precious and semi precious are procured from DTC (Diamond Trading

Corporation), whereby it becomes very easy for India to buy diamonds, as India have bilateral

treaty with UK and for this we don’t have to pay any import duty on rough diamonds.

One of the greatest strength of India is gem and jewellery sector is the presence of 2000

marketing offices in various parts of the world.

Weakness

Unavailability of finance.

Financial assistance is provided but at very high rate of interest.

Illegal flow of mechanized international jewellery.

Due to illiteracy among the skilled cbv.`raftsman they are not able to add value to raw gems in

more efficient and effective way.

India does not have modern cutting and polishing machinery and expertise that leads to

increase in overall cost of production

Unnecessary extra documentation by Government agencies.

Inefficient and ineffective role of staff of customs and income tax who are creating lots of

hurdles.

Lack of distinctive and innovative designs.

Indian importers are facing big problem due to exchange rate fluctuations and inflation.

Opportunities

High growth of global demand of gems, jewelleries and diamonds.

Rising demand of oriental jewellery ( ethnic jewellery of 21-22 carats ).

Government’s liberal policies about gems and jewellery promising industrial policy.

India’s Gems and Jewellery Export Promotion Council ( GJEPC ) is aiming at turning India

into an International Diamond Trading Centre.

Threats

Loss of opportunity because of delaying tactics.

International standards on quality products.

Brand loyalty of customers may hinder a lot because India lacks in branding of gems and

jewelleries.

Conclusion

Recent changes in market structure

The Indian gem and jewellery industry is experiencing rapid changes in the last few years. A

lot of emphasis is being laid on the jewellery designing and many Indian importers and


exporters are engaging foreign designers for designing their collections. Indian designers are

also making a mark on the world jewellery scene and have won recognition for design

development as well.

Indian designers are learning quickly and winning awards at international competitions

reinstating the ability of the Indian industry to cater to varied markets.

More significant changes are being witnessed in the domestic jewellery market where branded

jewellery is providing ample of competition to the family jewellers.

The domestic market for branded diamond jewellery is the fastest growing segment of the gem

and jewellery market. But standardization of jewellery across the country may still not work so

well in India, as every region of India demands not just different designs but different raw

materials as well.

Indian jewellery industry is seen changing its trend due to strong western influence. Traditional

and ethnic jewellery is becoming lighter, being object of adornment rather than an investment.

In last few years, gold has lost some of its sheen as an investment option particularly in urban

India, where people are exposed to alternate forms of savings and investment like equities and

bonds. The proliferation of modern gadgetry like laptops, cell phones and white goods has

grabbed away a part of the urban Indian’s disposable income and this also affected their

investments in plain gold jewellery.

More and more consumer are experimenting with the diamond and colour stone jewellery and

it is this category, which is driving the domestic market to new high of consumption. The last

few years have also seen the entry of prominent international brands in the jewellery and watch

segment. The advent of various foreign players in the Indian retail scene has greatly affected

the design and display of the entire industry, which has become all the more creative.

On the manufacturing scene, India is being seen as the ideal market for outsourcing jewellery.

With rising costs becoming a problem in the traditional strongholds for jewellery

manufacturing in the world, India will see more and more global giants coming to India for

their jewellery requirements. Already there are talks about US companies like Wal-Mart and K

mart coming to India for their jewellery supplies.

With Indian government committed to reduce custom duties for the jewellery raw materials and

semi-finished jewellery (mountings and findings), it is becoming all the more relevant for the

foreign companies to join hands with the Indian jewellery manufacturers and thereby control

the rising jewellery manufacturing costs.

The current report on jewellery clearly brings out that while U.S. is a world leader in jewellery

imports, there is no match for India in the diamond processing. While U.S. leads the world in

jewellery design and manufacturing technology, the vast pool of skilled craftsmen are the

biggest assets for Indian the gem and jewellery sector. Thus, India with some improvement can

have cost advantage over U.S..

It is also observed that while increased competition from emerging centres of jewellery

manufacturing like Turkey ,China, Thailand, and Italy are putting pressure on the U.S.

jewellery industry, India’s formidable position as a diamond processing centre is being

challenged by emerging cutting centres like China. To overcome future challenges and further

erosion of markets to emerging markets, the two world leaders of the gem and jewellery

industry should see each other more as collaborators rather than competitors.

Suggestions

To move up in the imports of colored gemstones and diamonds , various importers and

exporters should move for forward and backward integration so that the need for strategic

alliances with the producers of rough gemstones and diamonds and retailers of jewellery can

lead to economies of scale and higher market share. It would also be advantageous for

importers of rough gemstones, diamond and jewellery


Efforts to be taken towards development of skills and infrastructure for India to become a

known importer of raw gems, jewelleries and diamonds to trade them by adding values in it.

The industry should adopt modern technology in cutting and polishing segments that will

increase its overall export value. Increase in exports directly affects the value of imports. It is

so because increase in exports leads to increase in imports.

Low entry barriers have resulted in ‘Not so good players’ in industry adversely affecting the

image of overall Indian importers. So, need for ‘certification’ is required.

Need to encourage corporatization in this sector as proprietary concerns/ partnership model of

governance limits the expansion this field.

Need to expand the gemstone sector by increasing its import value, it is because of the reason

that labor is cheaply and abundantly available.

The sector of jewellery is still being ignored presently. Thus, there is a need to move towards

exports by increasing imports of raw colored gemstones, diamonds and jewelleries.

India needs to integrate throughout the jewellery supply chain from mining of raw material to

the retailing of end products.

India can go for joint ventures for importing raw gemstones and diamonds to manufacture with

leading suppliers of the world such as U.S., Italy etc.

Government should change policies according to convenience of importers.

Procedural hazels should be minimized to enable importers to apply entire men, time and

energy on business.

Implications of the study

The study of import potential of colored gemstones and diamonds of India is advantageous to many

parties:

Importer

This project is helpful to importers who mainly deals in imports of raw gemstones and

diamonds in order to take advantage of potential markets available in international business.

Students of International Business

This project is helpful to study different potential markets in present global market. It is helpful

to students in getting deep knowledge about international market.

Researchers

The study of import potential of colored gemstones and diamonds of india helps researchers

who are interested in this field and provides various information related to future aspects by

considering various trend analysis.

Government

This research study has generated useful suggestions for government. If suggestions generated

on basis of study are implemented by government it will help to promote import and export of

gems and jewellery sector.

References

Webliography :

‘import potential of colored gemstones in India’ retrieved on 17/2/12 at 1:45pm.

www.eximbankofindia.com

‘ data on import of colored gemstones and diamonds in India’ retreived on 22/3/12 at 12:45pm.

www.commerce.nic.in

www.eximkey.com

www.gjepc.com

http://www.eximbankofindia.com/

http://www.commerce.nic.in/

http://www.eximkey.com/

http://www.gjepc.com/


A Study on Export of Wheat and Documents Required

Dr. Kalpana Agrawal, Assistant Professor, Prestige Institute of Management and Research,Indore.

Ritesh Sharma, Rinita Verma, Student of Prestige Institute of Management and Research,Indore.

Abstract:

India is the second largest producer of wheat in the world, with production hovering around 68–

75 million tons for past few years. The latest estimated demand for wheat production for the year 2020

is approximately 87.5 million tons, or about 13 million tons more than the record production of

75 million tons harvested in crop season 1999–2000. Since 2000, India has struggled to match that

record production figure and thus faces a critical challenge in maintaining food security in the face of

its growing population. The current major challenges facing future wheat production in India are

increasing heat stress; dwindling water supplies for irrigation; a growing threat of new virulence of

diseases such as wheat rusts (yellow, brown, and black) and leaf blight; continuous adoption of rice-

wheat systems on around 11 million hectares; changes in urbanization patterns, and demand for better

quality wheat. In addition, the threat posed by the new stem rust race Ug99 cannot be underestimated.

The wide gap (around 2.5 t/ha) between the potential and harvested yield in the eastern Genetic Plains

also cries out for solutions. Addressing issues related to different stresses will require harnessing genes

discovered in landraces and wild relatives following conventional as well as non-conventional

approaches. For effective technology delivery in areas that suffer from poor linkages with farmers,

participatory research needs to be strengthened.

Keywords Wheat - Tritium aestivum - Wheat improvement - India - Present status - Challenges -

Future prospects

INTRODUCTION:

In the realm of food crops in the world, wheat (Triticum spp.) occupies the number one

position. India is one of the principal wheat producing and consuming countries in the world. Its

importance in Indian agriculture is second to only rice. Wheat flour based products, such as

the chapati, is part of the staple diet in most parts of India - particularly in northern India. Wheat straw

is also used for feeding cattle. The Green Revolution, which was initiated in the country in the late

1960s, has had a very significant effect in increasing the yield of wheat. The output ratio of wheat to

rice has steadily increased 1:3 to 4:5. Since 1991, the Ministry of Agriculture has been giving massive

thrust to boost its output in the country. At present Uttar Pradesh, Punjab and Haryana are the three

major wheat producing states. They account for nearly 70 per cent of the total wheat produced in the

country. Though Uttar Pradesh has the highest production In India, it lags

behind Punjab and Haryana in terms of yield. Better irrigation facilities in these states are responsible

for higher yield. In Haryana, 98 per cent of the area under wheat is irrigated and in Punjab the ratio is

96 per cent. However, in Uttar Pradesh, only 88 per cent of the area under wheat is irrigated. Wheat

output in non-traditional states is also being popularized by improving irrigation facilities and

developing seeds suitable for cultivation in these regions.

Wheat is cultivated in an area of around 25 million hectares which represents a fifth of the total area

under food grains in India. Around 80 per cent of the area under wheat is irrigated. India accounts for

about 11 per cent of the total area under wheat cultivation in the world. Efforts were initiated in 1976

to popularise the cultivation of wheat in areas, which had traditionally not cultivated it, such as West

Bengal, Kerala, Assam, Orissa and Andhra Pradesh. India is broadly divided into 5 wheat zones based

on agro-climatic conditions.


The wheat crop is harvested when the grains harden and the straw becomes dry and brittle. The

harvesting time varies from zone to zone and also depends whether the wheat is under irrigated

or rained conditions. The rained crop reaches harvesting stage much earlier than the irrigated crop.

However, the yields under the rainfed crops are much lower compared to the irrigated crop.

This hard wheat is cultivated in clayey soil and is highly sought after for its physical characteristics. Its

high gluten strength and uniform golden colour makes it ideal for bread making and pasta preparation

unlike the softer commercially high yielding wheat, which lacks the strength and consistency of

durum. Today, India is exporting sufficient quantities of all types of wheat and extensive research

efforts are underway for improving its cereals and grain output in the years to come. Wheat cultivation

has traditionally been dominated by the northern region of India. The northern states of Punjab and

Haryana Plains in India have been prolific wheat producers. While this cereal grass has been studied

carefully in the past, recent years of painstaking research by India's finest scientific talent has paid off

with the development of distinctly superior varieties of Durum Wheat. With a production reaching ten

times in past five years, India is today the second largest wheat producer in the whole world. Various

studies and researches show that wheat and wheat flour play an increasingly important role in the

management of India’s food economy.

Exports of wheat:

When saturation of domestic demand was observed and further compulsion of sustaining the present

market condition, the only avenue of liquidation of inventories was Exports. But disparity of domestic

and international prices were dealt with subsidized issue price which served prime objective of quick

and faster replacement, reducing carrying cost which ultimately form the major share of subsidy and

ultimately earn the foreign exchange which shall provide India a dependable supplier in the Wheat

world market.

India’s Position in World Wheat Market: (TABLE NO. 1)

Country %Share of Country

China 22

India 13

USA 13

France 7

Romania 6

Russian federation 6

Canada 5

Australia 4

Italy 4

Turkey 4

Pakistan 3

Wheat importing countries from India

Chicago (CBOT)

Canada (Winnipeg commodity exchange)

Kansas (Kansas city board of trade)

Missouri

Japan

Australia

Bulgaria (Sofia commodity exchange)

China


Production of wheat:

Wheat is one of the most important staple food grains of human race. India produces about 70 million

tons of wheat per year or about 12 per cent of world production. It is now the second largest producer

of wheat in the world. Being the second largest in population, it is also the second largest in wheat

consumption after China, with a huge and growing wheat demand. Wheat is one of the most important

staple food grains of human race. India produces about 70 million tons of wheat per year or about 12

per cent of world production. It is now the second largest producer of wheat in the world. Being the

second largest in population, it is also the second largest in wheat consumption after China, with a

huge and growing wheat demand.

YEAR TY PRODUCTION UNIT OF MEASURE GROWTH RATE

2002 72770 (1000 MT) 4.43%

2003 65760 (1000 MT) -9.63%

2004 72150 (1000 MT) 9.72%

2005 68640 (1000 MT) -4.86%

2006 69350 (1000 MT) 1.03%

2007 75810 (1000 MT) 9.32%

2008 78570 (1000 MT) 3.64%

2009 80680 (1000 MT) 2.69%

2010 80800 (1000 MT) 0.15%

2011 85930 (1000 MT) 6.35%

2012 85133.333 (1000 MT) 5.10%

2013 86967.394 (1000 MT) 5.61%

2014 88801.455 (1000 MT) 6.12%

2015 90635.515 (1000 MT) 6.63%

2016 92469.576 (1000 MT) 7.14%

2017 94303.636 (1000 MT) 7.65%

2018 96137.697 (1000 MT) 8.17%

2019 97971.758 (1000 MT) 8.68%

2020 99805.818 (1000 MT) 9.19%

(TABLE NO. 2)

-15.00%

-10.00%

-5.00%

0.00%

5.00%

10.00%

15.00%

0 5 10 15 20 Series1


Government Policy Regarding Wheat:- Since wheat prices at procurement level and at disposal level are placed under controlled mechanism

with defined objectivity, scope of general price trend analysis also becomes govt. policies centric. The

related price in the open market has got a substantial relationship with the prices of wheat traded in the

open market. Therefore this aspect has a notion that the price elasticity of demand has got direct

relationship on prices of wheat of other varieties (whatsoever be the size of share in total production).

However availability of targeted variety (Mexican/Dara) wheat shall increase, if Govt. withdraws

gradually from procurement at MSP; in the open market, which shall concede volatility.

Geographical Area under Wheat Cultivation:

It is cultivated from a sea level up to even 10,000 feet. More than 95 percent of the wheat area in India

is situated north of a line drawn from Bombay to Calcutta and also in Mysore and Madras in small

amounts.

The Major Wheat producing states in India is placed in the Northern hemisphere of the country with

UP, Punjab and Haryana contributing to nearly 80% of the total wheat production.

Achievements of Indian wheat programme:

372 wheat varieties released in the country since 1965

119 genetic stocks for various traits

Advanced production technologies with eco-sustainability through resource conservation

The crop protection strategies acted as barrier to disease havoc since last 4 decades

Germplasm enrichment and sharing across the country

Infrastructure created to produce more around 30,000q of breeder seed

Quality parameters standardized for specific products

Strengthening the wheat research to partner countries for global food security

Sound international linkages

Documentation:

An exporter without any commercial contract is completely exposed of foreign exchange risks that

arises due to the probability of an adverse change in exchange rates. Therefore, it becomes important

for the exporter to gain some knowledge about the foreign exchange rates, quoting of exchange rates

and various factors determining the exchange rates. In this section, we have discussed various topics

related to foreign exchange rates in detail. Export from India required special document depending

upon the type of product and destination to be exported. Export Documents not only gives detail about

the product and its destination port but are also used for the purpose of taxation and quality control

inspection certification.

Shipping Bill / Bill of Export:

Shipping Bill/ Bill of Export is the main document required by the Customs Authority for allowing

shipment. A shipping bill is issued by the shipping agent and represents some kind of certificate for

all parties, included ship's owner, seller, buyer and some other parties. For each one represents a

kind of certificate document. Documents Required for Post Parcel Customs Clearance

In case of Post Parcel, no Shipping Bill is required. The relevant documents are mentioned below:

Customs Declaration Form:

It is prescribed by the Universal Postal Union (UPU) and international apex body coordinating

activities of national postal administration. It is known by the code number CP2/ CP3 and to be

prepared in quadruplicate, signed by the sender.

Dispatch Note-

It is filled by the exporter to specify the action to be taken by the postal department at the

destination in case the address is non-traceable or the parcel is refused to be accepted.

http://www.eximguru.com/exim/indian-customs/customs-regulations/shipping-bill-and-bill-of-export-form-regulations-1991.aspx


Commercial Invoice –

Issued by the exporter for the full realisable amount of goods as per trade term

Consular Invoice –

Mainly needed for the countries like Kenya , Uganda, Tanzania, Mauritius, New Zealand, Burma,

Iraq, Ausatralia, Fiji, Cyprus, Nigeria, Ghana, Zanzibar etc. It is prepared in the prescribed format

and is signed / certified by the counsel of the importing country located in the country of export.

Customs Invoice –

Mainly needed for the countries like USA , Canada, etc. It is prepared on a special form being

presented by the Customs authorities of the importing country. It facilitates entry of goods in the

importing country at preferential tariff rate.

Legalised / Visaed Invoice –

This shows the seller's genuineness before the appropriate consulate or chamber or commerce/

embassy.

Certified Invoice-

It is required when the exporter needs to certify on the invoice that the goods are of a particular

origin or manufactured/ packed at a particular place and in accordance with specific contract. Sight

Draft and Usance Draft are available for this. Sight Draft is required when the exporter expects

immediate payment and Usance Draft is required for credit delivery.

Packing List –

It shows the details of goods contained in each parcel / shipment.

Certificate of Inspection–

It is a type of document describing the condition of goods and confirming that they have been

inspected.

Manufacturer's Certificate-

It is required in addition to the Certificate of Origin for few countries to show that the goods

shipped have actually been manufactured and is available.

Certificate of Chemical Analysis-

It is required to ensure the quality and grade of certain items such as metallic ores, pigments, etc.

Certificate of Shipment-

It signifies that a certain lot of goods have been shipped.

Health/ Veterinary/ Sanitary Certification –

Required for export of foodstuffs, marine products, hides, livestock etc.

Certificate of Conditioning-

It is issued by the competent office to certify compliance of humidity factor, dry weight, etc.

Shipping Order-

Issued by the Shipping (Conference) Line which intimates the exporter about the reservation of

space of shipment of cargo through the specific vessel from a specified port and on a specified

date.

Literature review:-

According to Mishra (2004) slow growth in total wheat production up to 1965 necessitated a large-

scale grain import by India under the PL480 system. The series of agricultural changes following the

utilization and exploitation of Norin 10 dwarfing gene in wheat after 1965 was called “green

revolution”, the impact of green revolution made India self-sufficient in food grain production. The

80’s witnessed quantum jump of wheat production making India worth of stockpiling adequate buffer

stock to thwart the adverse weather and other calamities.

Wheat production is now seeking a turning point towards keeping the wheat price and supply

affordable for more than 240 million people below the poverty line. The Indian council of agriculture

research (ICAR) having taken into cognizance the previous efforts, struggled to increase the

productivity, concern the augment and sustain what has been achieved, issued the directives and

guidance to develop the vision for research mandate to adopt in the forthcoming decades.


According to Kumbhar (2007), agriculture is the main occupation of the Indian people. Performance of

Indian economy is dependent upon the growth of agriculture sector. It contributes nearly 16% of

India’s gross domestic product (GDP) and 13% of total export. It provides employment to 52% of the

countries work force and livelihood security to more than 620 million people. Agriculture plays an

important role in economies development, such as provision of food to the nation, enlarging exports,

transfer of manpower to non-agriculture sector, contribution to capital formation, and securing markets

for industrialization. Agriculture forms the backbone of Indian economy and even though large

industraliasation in last 60 year, agriculture still occupies a place of pleasure.

Ahmed and Rustagi (2004) emphasised that liberalization of Indian economy has opened immense

opportunities for exports of agriculture products. GCC countries are heavily dependent on import of

agriculture commodities to fulfill the needs of rapidly growing population. Due to geographical

proximity to GCC countries and natural comparative advantages to Indian farmers there is a large

scope for exports of agriculture commodities to GCC.

Mitra and Ghosh (2008) found that agricultural exports from developing countries are facing stringent

barriers in the form of sanitary and phytosanitary measures as well as technical barriers in the form of

sanitary and phytosanitary measures as well as technical barriers: the need of the hour, therefore, is to

develop robust agricultural exporting zones (AZEs) to promote organic cultivation of exportable

produce. The analysis of the future growth potential of AEZs in India is based on two planks: a

theoretical cost benefit analysis and a case study approach. The theoretical cost benefit analysis

highlight the tradeoff between factors that enhance profitability on the one hand and other that lead to

a reduction in profitability.

Venkatraman and Prahaladachar (1981) estimated and analyzed the growth rate in area, yielding and

output of major crops in six states including Bihar, for the period 1950-51 to 1974 to 1975 and also the

impact of growth rates on cropping pattern in these states. In Bihar, the review of cropping pattern

changes during 1950 to 1975 indicated that within the cereals rice, maize and wheat gained in area

whereas barley lost in area. In the cropping pattern the relative importance of wheat and maize

improved from 6 to 15 per cent and 6 to 18 per cent, respectively. The output growth rate during the

period 1950 to 1975 was highest for wheat (9.5%), followed by maize (3.7%).

SyeedaKhatoon (2005) in his study found that Indian agricultural has been hit hard during post WTO

period (1995-2005). The share of agro goods in India’s global export has declined during this period.

During post WTO period, agricultural subsidies of developed countries have been rather increased.

Therefore it is very difficult for India to face global agricultural competitiveness. In this scenario, the

global agricultural trade would likely to become oligopolistic. The returns of various crops have

declined due to increase in cost of production, slow growth of agricultural productivity, weak

marketing mechanism, increase in input intensity and fall of water table. As a result farmers have

become highly indebted and resorting to suicides. In the near future also the total quantum of exports

particularly agriculture and light manufacturing goods cannot be raised significantly in the global

market in the near future because of limited and uncertain domestic export surplus and particularly

their inelastic demand at world market. In other words, Indian exports were considered to be supply

constrained and also were not responsive to relative price changes at the global level. Raising the

levels of productivity and quality standards to internationally competitive level is one of the major

challenges following the dismantling of quantitative restriction on imports, as per the WTO agreement

on agriculture.

Mitra (2007) contended that given the slow growth of wheat in the recent past, the increased provision

for agricultural infrastructure is an essential prerequisite not only for inclusive growth but also for

sustained reduction in the propensity to import food will imply that more earned income are ploughed

back into the economy and subjected to the multiplies.


Objectives of the study:-

To study the trend of export of wheat from India.

To study the documents required for the export of wheat.

To study the problems faced by exporters of wheat.

Research Methodology

The Study:

The present study was undertaken to comprehend the export of wheat from India and

documents required for it.

The Sample: The sample of the study comprises of secondary data, which was collected from secondary

sources like internet, government official website and journals. The sample includes the export

data for the period of last ten years (2002-2011).

Tools for data collection:

Data required for the present study was secondary in nature. The yearly export reports of wheat

from India have been used. The data were gathered from various official websites such as,

www.commerce.nic.in, www.exim.com, www.books.google.co.in,

http://nmce.com/default.aspx etc.

Tools for data analysis:

The trend analysis was used to analyze the trend of export of wheat from 2002-2011 from

India.

Trend Equation: S = a + bt

∑S = Na + b∑T

∑ST = a∑T + b∑ [T]2

Where S=results

a,b= constant

T= Time, Total

Results:

YEAR TY EXPORT Trend value GROWTH RATE

2002 5350 3727.36 65.43%

2003 5425 3209.46 1.40%

2004 1605 2691.55 -70.41%

2005 369 2173.65 -77.01%

2006 33 1655.75 -91.06%

2007 43 1137.84 30.30%

2008 21 619.94 -51.16%

2009 62 102.04 195.24%

2010 60 -415.86 -3.23%

2011 1000 -933.76 1566.67%

2012 -1451.67 -1451.66 656.81%

2013 -1969.57 -1969.56 747.76%

2014 -2487.47 -2487.47 838.70%

2015 -3005.38 -3005.37 929.65%

2016 -3523.28 -3523.27 1020.59%

www.indexmundi.com


http://www.exim.com/

http://www.books.google.co.in/

http://nmce.com/default.aspx

http://www.indexmundi.com/


Discussion:

Wheat exports from India reached a hike of above 5000 Million tons during the year 2002-2003 and

then markedly declined at an even pace to 1605 Million tons in 2004.Again in 2005 it further showed a

deep declining trend as the government halted export subsidies because of tightening of domestic

supplies and reduced Indian competitiveness in international markets, although private traders

remained free to export wheat. Further the fate of Indian wheat export bleak as the trend above during

2006-2010 wheat exports were almost nil. Due to unmanageable food grains stocks, the Govt. of India

decided to export its Wheat stocks at a highly subsidized price (declared at port cities) through Govt.

agencies such as STC, MMTC and PEC. As there was generally a flat moment during these periods,the

possibility of increasing our wheat exports was dangled.But it got proved wrong and then suddenly

during 2011 the export of wheat raised to 1000 million tons. Still after having a look of the exports of

the previous years, there may be a possibility of a rise in the exports in the future time period. Looking

ahead to 2017, an inclining trend is expected and also the average level of wheat prices is expected to

go higher than the previous years.

Wheat: India may be out of the world market

After heavy exports over the past several months, Indian wheat exports have started tapering off, with

few vessels now loading at Indian ports. According to trade sources, if no government export subsidy

is forthcoming, exports will cease, as Indian wheat will no longer be competitive vis-a-vis wheat from

other origins like the Ukraine, Romania, Eastern Europe, and Australia will take lead. With wheat

currently priced at $170 FOB, even neighboring importers like Bangladesh and Sri Lanka have started

looking at other origins for their wheat requirements. Although private importers still have wheat

stocks they procured this year from the domestic market in the hope of a government export subsidy,

they will soon start selling it in the domestic market if no government subsidy is offered.

Conclusion:

The study also revealed that India is growing more wheat than it ever has. That may sound like very

good news given the fact that India along with China is the largest consumer of wheat, but the fact is, it

does not quite know what to do with it. India doesn’t have policies that will allow the country to use

the wheat efficiently. It doesn’t even have enough places to store it. There is also no surety that wheat


production will be equally robust in the coming years. The current state of plenty is just two seasons

old. Following the bumper harvest (80.17 million tons) of 2010, the country is now looking at another

81.74 million tons in a harvest season that has just begun.

The last couple of years, India have had a good monsoon and hence the production was good. But if

she has even one bad monsoon, there will be dire shortage. These bumper harvests are the outcome of

a two-pronged government approach of banning exports, and raising the minimum support price

(MSP) as an incentive to bring more land under wheat cultivation. The gains at the height of the Green

Revolution in the 1970s and 80s riding on the back of high-yield seeds and pesticide use have been

slowing down. Between 2000 and 2010, the land under wheat cultivation grew by just 1.21 percent and

there was a drop in yield (compared to the 1980s). Wheat production had fallen to 9.23 million tons in

2006-07 and export was banned in October 2007, however, such an approach doesn’t provide

sustained support for wheat farming.

One part of the problem “lies with the procurement system. Any farmer can sell any amount of wheat

to the government and the government has to buy it. The MSP too has been raised to an unreasonable

level as it is a political issue.”

The other part of the problem is that the government is not equipped to efficiently store and use

bumper crops for future consumption, thanks to the pathetic conditions of the warehouses run by the

Food Corporation of India (FCI). Enormous volumes of grains rot every year.

Implications of the study:

It may be concluded from the present study that the production and productivity of wheat in India is

expected to increase in the present decade, even then the country is likely to remain in deficit, so far

demand supply balance of wheat is concerned. Comparatively higher prices of wheat during lean

period suggest that more warehouse and storage facilities be created so that farmers could store wheat

during post harvest period and release it when prices are higher. So far as price spread in wheat

marketing is concerned an efficient transportation system and reduction in cost on commission charges

and taxes as well as margin of profit taken by the wholesalers and retailers may further improve the

marketing efficiency.

From the above discussion the following policy implications emerges:

There is need to establish adequate storage and warehousing facilities and also to popularize

their advantages among the farmers to encourage them to store the produce to create time

utility.

To improve the technology of wheat production and needs to be extended in a big way to

farmers in order to increase the productivity level of wheat in India and to wipe off the deficit

or gap.

Suggestions:

Govt. Should Encourage Private Players:

Encouraging private players in the procurement and storage process will enable the government to

absorb the production from states where FCI infrastructure is inadequate.

In its attempts at increasing storage capacity, last year the FCI started a scheme to invite private

participation in building more warehouses. The plan invites private players to build granaries and

the FCI guarantees at least 10 years of rent for them. So far, deals to build 10 million tonnes of

storage have been signed but these granaries will be completed only by next years.


Limited Procurement: The government should set a quota for how much wheat it will buy from farmers, and let them

export the rest or sell in the domestic market itself. the total production is at the end of the harvest

season and only if we have enough for our buffer stocks should we take a call on whether to allow

export of wheat or not. Countries such as Russia and China, which are large producers of wheat,

have had a poor harvest and are not exporting their produce. If we starts exporting now, and then

realize we will be falling short later, we will face a problem where availability and price of wheat

in the import market is concerned.

Build Strategic Reserves: For safety from fluctuations in supply, globally as well as domestically, maintain a constant stock

of wheat by creating long-term storage facilities. This will ensure food security. It will also give

clarity on the possibilities of exporting wheat when international demand is high. The global wheat

scenario is already raising concerns in many countries. Russia, the world’s third largest exporter,

stopped wheat exports after it lost a quarter of its crop last year to its worst drought in 50 years.

China, the world’s largest producer, too may lose about two-thirds of its crop after an exceptionally

dry winter in its wheat growing region. The impending shortage in the import market has pushed

global prices close to their all-time high of 2008.

Countries in West Asia and North Africa are stocking up with orders being placed for several

thousand tones. These points to fears of an impending crisis of availability and price.

Russia had announced its intent to build strategic wheat reserves along with China and India and

even give out 20 million hectares in joint ventures for wheat farming in early 2010. This would

protect Russia’s wheat prices and be a counter to the US’ wheat diplomacy (the US is sitting on a

stockpile of 30 million tons). But that, of course, was in the months following Russia’s 100 million

tone production and before drought brought that figure down to 60-65 million tones.

REFERNCES:

Webliography:

Data were retrived on 12/1/12 at 12.30a.m. from www.commerce.nic.in.

Data were retrived on 12/1/12 at 1.am from www.exim.com.

Data were retrived on 12/1/12 at 1.30am from www.books.google.co.in.

Data were retrived on 15/1/12 at 2.00pm from http://nmce.com/default.aspx.

Data were retrived on 20/1/12 at 3.00pm from www.indexmundi.com.

Data were retrived on 1/2/12 at 2.35pm fromhttp://www.financialexpress.com/news/adverse-

weather-to-hit-grain-production-thismarketing-year/61499/0.

Data were retrived on 15/2/12 at 2.45p.m. from http://www.business-

standard.com/india/news/govt-may-lift-banexportwheat/428265/.


http://www.exim.com/

http://www.books.google.co.in/

http://nmce.com/default.aspx

http://www.indexmundi.com/

http://www.financialexpress.com/news/adverse-weather-to-hit-grain-production-thismarketing-year/61499/0

http://www.financialexpress.com/news/adverse-weather-to-hit-grain-production-thismarketing-year/61499/0

http://www.business-standard.com/india/news/govt-may-lift-banexportwheat/428265/

http://www.business-standard.com/india/news/govt-may-lift-banexportwheat/428265/

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