MANAGEMENT AND ADMINISTRATION
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- MANAGEMENT AND ADMINISTRATION
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RF_M_2_SUDHA
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PREWATAL INFLUENCES-II
PW
1• Drugs, Gases, Prisons, Snorri nr< Alcohol
2* Maternal Factprg
i) Age
ii) Parity
iii) Fatigue
coMWiuNir/ HcM^Har^oad
47/1,(FirstFl°co--■
iv) Emotions
▼)
Sensitization
▼i) Dysfunction
3« Paternal factprg i)
4* Prenatal environmental influences on behaviour
Ipipli cations in ante-natal care
i) Drugs and the fetus
The thalidomide (sedative) disaster of 1961 focussed attention
not only of the medical eorld but also of the general public on the
possibility of a drug regarded as being safe, actually being of
irrepairable haim to the fetus ♦
Problem of study of drugs and their effects on the fetus is that
experimental methods have to be indirect
i) animal experiments - not necessarily applicable to man.
ii) Cytogenetic studies - yield significant infoxmation.
iii) Legalised abortion has made human material available for study,
iv) Therapeutic accidents, sporadic reports and retrospetive
studies.• These methods useful in building up as comprehensive
a picture as possible Important however not to build up an alaxmist
attitude and all to easily condemn many most useful and effective
drugs in the present therapeutic
Important facta of fetal physiology which must be hprae in grind
when considering effects of drug;
i) Therapeutic substances seldom administered directly to fetus
except blood and radioopaque substances. Main routes of
access to the fetus via the placenta or aminidic fluid.
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-2ii)Transfer across placenta and transfer back to maternal
circulation of both the substance and its break down products. Depen
-dent on pexmeability of placenta, protein binding in mothes and
fetus renal function in the fetus, differential rates of metabolism
in mothes and fetus and placental function among other factors.
Bii)Substances gaining access to liquor
may reach, fetus
directly through its poxmeable skin in early pregnancy or via its
git in lates pregnancy. When there is an appreciable amount
of fetal urine into the liquor the drug and its breakdown products
may reach the liquor and be available for reingostion by the fetus.
iv)Many enzymes systems are inactive in the fetus affecting drug
metabolism.
v)Routes of excretion. Placenta and urine into liquor
vi) All above factors change with progress of pregnancy
The therapeuUc situations which
se th® fetus to the action of
drugs and therapeutic regimens
1. Drugs given directly to fetus - advancing field.
2. Drugs given to mothes to secure a desired effect on the fetus
i) Abortifacients
ii)Antibiotics as prophylactic against congenital pneumonic in
premature rupture of membrane
iiil Phenobarbitone for hyperbilirubinemia prophylactic vitamin K.
3* Drugs given to the mothes for diagnostic and or therapeutic reasons
which may cross the placenta and affect the fetus.
4. Drugs given to women who may be pregnant .-important especially since
embryonic period is maximal risk vic for malformation.
Types of damage to fetus
1 • Abortion-
Substances which produce abortions usually differentially
poison the mothes and the fetus or interfere with the development
of fetus e.g. i) Quinine , ii) Lead compounds
iii) Nitrogen mustards
iv) Prostagladins (action on uterus)
£• Tenatogonecity - Tenatogenio effect of a drug depends on :
1} Voratogen reaching conceptus
ii) the concentration which it achieves
iii) the stage of development at which exposure occurs
i) Thalidoad do;
linb deficiencies, ear hypoplasia eye anamolies
and intestinal atrisias.
ii) Tetraaj^nlingfl;
enamel hypoplasia and yellow pigmentation of teeth
iii)AntinetabQaites : fydreoephalus, craniosynostosis, shortened limbs.
absent digits and mental deficiency.
iv) Anticonvulsants DjphenyJhvd^itd^s: Mental deficiency microcephaly.
craniofacial anomalies, nail hypoplasia.
Tzidione/Paradione: Minor anomalies of face, ear and heart defects
v) Warfarin: nose hypoplasia short digits, stippled epiphyses and mental
deficiency.
v^) Iodides; goiter and fetal hypothyroidism
vii) Honnones
*• Mdxweng and synthetic progeaiggwa
Mascmlinzation of female fetus
b* Stilboostenol - carcinoma dnd adenosis of the vagina in exposed
female foetuses; genito urinary anomalies is exposed male fetuses
c. flomone pregnsnet: tests: increased malfoxmations
d» OrAl contraceptives: limb reduction deformities, heart defects.
oesophageal anomalies
viii) g£
Syndactyly and absence of pectoralis major
muscle (Flonad Anomaly)
Adverse effects on function
i) Sedatives: Barbituateg- also depression of coagulatin respiratory
depression.
ii) Anaesthetics: respiratory depression
iil)Sulphonamides* may compete with plasta albumin for bilirubin
binding sites and thus increase dosages, of kosniotenus if given
to premature or new born.
iv) Saawd-derivativea: bleeing manifestation in neonale g e
▼) / tx^pineg fetal tachycardia
vi) Stpjptonycin: may produce deafness
▼ii) ^hlprfinpbenGpX- grey syndrome -peripheral vascular collapse
viii) &ilrhonylureas - Chlorpropamide and mibut^de
- hypoglycemia, Vesalagenity
ix) Eethicine - Respiratory depression snd addiction
x)
Chlo ithi agjde - throrabory vopenic
xi) fralcylateg- congenital intoxication, teratogenic
4- fiSgeg i) Goal gas - fetal poisoning serious defonnities
* retrelestal flbroplasa (blindness)
11)
iii) Agylnitrate * increase in fetal heart
iv) Bther - Narcotic effect
5« Zllorga.rn.c i'piboxis: e«g« Lead, Mercury, Arsenic copper,
phosphorous, bromide, iodide, chlorate of potassium,
strontium and x yttrium all have been found in human fetus and all
are capable of damaging the fetus•
Radiation?;
X-Rays and atomic radiation are hazardous to fetus
Deleterious effect range from gross danago with cell necrosis to
production of abnormalities which nay not manifest until well into
poat-natal life.
Increased incidence of abortion, neonatal and infant deaths and
abnexnal children especially CNS abnormalities have been reported.
?• Vaccines
1) live vaccines * Smallpox should be avoided
Yellow fever: stongly contraindicated
Maaales/RabeU.&: No incidinatioa
Poligu should be avoided
Precaution of enquiring about possibility of pregnancy in all woiaen
of reproductive e.ge should be taken •
SiJied Vaccines - JAB, Cholcia, tetanus typhus
8« Smoking
1) Retards growth of urban child
ii) Birth weight on an average 5-8 ozs less
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iii) Higher mortality rate among children of alcoholics
(2) MATERNAL FACTORS
1 • Maternal Age;
- Stages in the development pf a women
Men&rche; adolescent sterility periodf nubility and maturity
Having babies at a very early age is almost as undesirable as
having them at a very late age
- The period from 2.3 to 28 years of age are the best age for
conception. During this period there is least difficulty,
in pregnancy, highest survival rates for mother and baby,
the highest
rates^ffaxm Lowest abortions, miscarriages,
otillbiirth, prematurity and malfonation rates.
a) Effect on birth weight; Mukherjee & Biswas (J. Ind. Med.A*
32: 389-398, 1959) observed a consistent increase in birth
weight with the mother’s age primiparas upto age 30 years.
Among those with 2-3 the increase was seen till 25 years - other
controversial studies (no effect etc.)
b) Wi oh increasing agp
— increasing incidence of Mongniison (older female
-dysplastic ovum) and
- choiionepethslioma
- vesicular mole
- achondroplasia
- central placenta praeria
- central nervous system malformations
- anencephaly
- twinsof unlike sex
c) Ratio of boys to girls tends to decline with advancing age of
mother
d) Oder age of mothers is as unfavourable factor in all levels of
retaidation but it is of greatest importance is imbeciles. It
offers a pleas for early marriage and completion of child
bearing before the mother is 35 fcears of age.
•) Prematurity, miscarriages and stillbirth are all associated with
maternal ago.
The yongest and older mothers tending to contribute
to the rates (Yerushalmy studies)*
f)
Toxaemias of pregnancy are more frequent in older mothers.
g) Ectopic pregn&nciGS arc more common in older mothers
h) In all the conditions discussed above the maternal age effect
is rather more considerable in the priripara than in the wultipara.
In the primipara of advancing age there is something akin to an
atrophy disuse effect in the reproductive organs.
2) PABITY:
The nffaberg pf pravjQUfl pyegnand^e of the irothsr birth pyder,
ond birth interval.
- Plrst bom children, as well as those bora at the end of a long
series of pregzumoi&s tend to be less viable than those born in between
irraspeotive of maternal a^e.
mai^sd with maternal age.
This tnedsncy becomes increasingly
Fetal malforelations are slightly
more coalman in children of Bothers ta having their first
pregnancies than in 2nd ani 3rd bora.
Anencaph&ly, spinabifida and
There is a complete
hydrocephaly are more oomnon in 1st burns.
reversal after bi: th of the association between parity portion in
the family and nortality.
lowest death rates*
First bora is characterised by the
Tho factors ccntributing to higher
mortality rate of firstborn is that primigrand as opposed to
multiparous women exhibit a marked tendency to slowing of
the utenDB utero-placental circulation*
This in. effect
means that the fetus receives as inadequate supply of oxygen
with consequences which nay bo fatal to it.
- Excess of mongoloids in the first birth rnak at all maternal ages
- PDA more coxason in firstborn * greater liabili y of first bora
to anoxia
* Marked correlation between primiparity and hydrothnics
- Birth weight increases by parity
X
- Congenital dislocation >of hip twice as common in first boras
than 2nd or 3rd boras.
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Rule: Prenatal cnvi rament f&ron the later bora while postnatal
farpn the ilrfft bpra
- Mental illness more among fourth bora and later jdaacadataxl^x
Kldorly multigraidda more problematic than elderly pnonigrardi
?• GATIGDE
■h
Should a mother work during pregnany?
?bt if is fatiguing. What is fatiguing? Difficult to define
studies in Great Britain, Scotland, Vienna, New Yoifc.
- Prematurity rates higher
- women who go to work during the later months of pregnancy
(Douglas)
- women who lack home help (Douglas)
- women who woik vs home makers (Ferguson, Hl
)
- women who have not wo iked at all vs women who woiked
during first four months of pregnancy (Report maternity in
Great Britain)
* I4o difference between working mothers and housewics if work
terminated 2^3 months before confinement (Balfour)
Conclusion: No reason to believe that woxk during the first 5 months
of pregnancy increases the risk of premature!ty or still birth, work
during the last 19 weeks however seem to invoke an additional risk.
Prenatal influences - P220 Dr. Sstewarts stud.
i) StAdy of fetal movements in relation to mothers activity *
no significant association
ii) Morris and cowoskers (Lancet 2: 4B1 (1956) found that muscular
exercise produces a reduction in effective utoiine contraction
and in a healthy woman rest results in an increase in utextee
circulation.
The reduction in the fatigued .mother would undoubtedly
be to the disadvantage of the fetus.
Among women who had infants with major defects greater prevalence of women
who did heavy work (McDonald 1958)
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Thei longer time a mother spent in a rest home (PeHer, Vienna 1930) the
greater was the average length and weight of the child.
In athletic exercise during prgnancy (Dr.Erdely ttaigary I960)
complications of pregnancy were less frequent, labor time was shorten,
frequency of CS half that of non athletes.
Conclusion:
Work and exercise far better for the mpthes and fetus
th^ inrxdeaiiate work and exercisef
How much work and exercise is
adequate Mind Iioj nuch work and exercise is top much?
(4) EWTIONS
Can the oregnant mothers emotional states in any way influence the
conception in her wokb?
Tradition indicates that they can.
Scientific enquiry - begins only n the last f w decades has
etTidcnce wnich is speculative.fciOTteraMES
Evidence supports the hypothesis
i) Stressful emotions in the pre—pregnant and pregant women are
capable of affecting the conptus in various ways - This will
depend on stage of development, genotype, maternal health
nutrition etc.
ii) During the orgasr-forming period of development in the second
four weeks there is evidence that maternal emotions affect
physical development
iii) At later stages of development it may play a role in such
functional physical changes in the fetus as pylonic stenosis
or peptic ulcer (not certain)
iv) Capable of producing hyperactive fetus and nyper irritable baby,
v) Maternal attitudes of acceptance, rejection or indifference may
well spell, the differ nee in some cases between adequate and
in adequate development of the fetus.
ti) Finally not all mothers who are emotionally disturbed during
pregnancy give birth to offspring woo have in any way been
seriously affected. Fregimt women should receive this
assurance
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prematurity, Cong. Malform, abnormal
(5) DISJUNCTION -
pulmonary vent, lateral
i) Diabetes • hypoglycemia, lane bab>, anoxia, lethargy
a) a
irthyroidism- hyperth|ri?oidigm, exophalmoe, hypothyrolism
iii) 3
th
idiim - goitre is fetus, cretinsm
iv) Parathyroidtffm- hypoparathyroidism in fetus
Increased Ca needs of fetus- osteomalace and tooth decay of
mother during pregnancy.
▼)
a
a
LViOl
corticoidigm - no significant abnormality of labour or
rticoidiam jnaaqs
- congential adrenal
vii) Anemia pf mother^ anemia in newborn is fourth fifth month when
stores are depleted
- congenital malformation and prematurity more on anemic mothers
viii) Thrombocy to penic purpura - transmitted to fetus
ix) Sickle cell anqgnia - abortion stillbirths and abnormalities
being quite frequent
x) hypertensive djpease- high rate of fetal loss due to
reduction in uterine end placental circulation
xL) Toxaemias of pre,
serious impairment in utero placental
circulation - Sodium and amino acid transport in fetus
impaired.
xjl.) Obe sty - is good neither for mother nor the fetus
xili) Hydramnios - assoc with malformations
xiv) Epilepsy • Some epileptics improve during pregnancy, some get
worse what effect maternal epileptic episodes dui'ing pregnancy
may have upon the fetus remains obscure at present.
xv) SLB- Transmission LE cells and newborn infants may develop
sercotiemjrlytio anemia, leucopenia and throxaborylopenia.
4
xvi)
Cho rio carcinoqa - transmitted to fetus
•
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xvii) Malicmant mataaomfl - transmitted by metastasis from the mothers
to the fetus
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(6) SENSITIZATION
i) RH factor
ii) Maternal fetal - ABO incompatibility
Hi) Transplacental sensitization of fetus possible for allergy Asthma Hay fever.
III. P-ATil'iNAL FACTORS
i) AGE - What is the father* s age
Yerushalmy has shown that there is infact a marked relationship
between the stillbirth rate and the fathers age.
The xr
rates are nigh for very young fathers and for old fathers
regardless of the age of the mother.
IV) PRENATAL WIIiONMENI'AL INFLUENCES ON BEHAVIOUR:
i) At birth Chinese children are a year older than their European
peers - because Europeans age- implicity ignores the prenatal
period.
-assumption between conception and birth there can occur kt
litrle or nothing of psychological importance.
ii) difficulties in research
a) Individual differ noes in behaviour thought to be
genetically determined.
b) Prenatal influences swamped by influences on morphology
c) Monitoring of fetal responses has been unreliable and
difficult to use.
d) Healthy reluctance to disturb mother or fetus for purpose
of research.
e) Scarcity of information on the neurophysiological and
endocrinological mechanisms mediating influences on
behaviour
iii) Current regearch shows evidence
a)Prenatal non-genetic transmission of information
>•
-11b) Protection from external stimuli which the fetus is
accorded by the womb largely offset by its extreme sensitivity
c) Assumption wrong - that feJ al nervous system is unlikely to
register experience
- unmyelinated fibres can also conduct
- EEG activity has been recorded in fetus from 7 weeks
onwards (before development of primitive grey matter and
hence sub-cortical ? in organs)
d) Visual and somatosensory responses at 24 weeks
- reflecting actual cortical events.
The uterine environment may give rise to
e) Conclusion:
subtler changes which thought causing no macroscopic abnormality
may somehow affect those developing neural tissues of the fetus
which
govern behaviour in later life (BMJ - 19&4)
f) Maternal experoicne is maturity as well as infancy, can
influence offspring behaviour both prenatally via the uterine
environment and post-natally via rearing behrviour*
g) Summary of finding of animal behaviour
- prenatal pediatrics - PI71
Influences
1 * Nutrition
a) Effect of vitamin supplements to mother in pregnancy
lactation- children at 4 year studied - IQ higner by 52
points than in contra
b) Light for date babies show significant intellectual deficits
in later life.
e) Monozygotic turns 27 par - lower- mean verbal and performance
IQ score by lower birth weight turns (unequal sh- ring of
inadequate nutrient supp
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d) Rats: lipid free diet affects maze learning performance
2, Oxygen - hypoxic in complicated pregnancies related to
cerebral palsy f epilepsy, mental retardation, reading
difficulties and behaviour»
x'roblems - poor motor coordination, reduced attention spas, poor k
concentration, hyperactivity, impatience, irritability and
temper tantzimi
By 8 yrs difference less
3* &rrioncc/Sleep/Fmotipn
- Effect of thyroid defficiency
- Effect of androgen
- imctional distress- unplanned pregnancy absent or disinterested
husband, distress at interruption of career, fears regarding
criild birth and compttence in child
hyperactive fetus
- colicky or necrotic exercise crying.
funness. child irritability after 3 yrs - marked snyness lack of confidence, poor initiative, apprehensions in social
contacts reluctance to join in play.
.......... W*
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e=M<£:c^r
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’l
M 2--2DCHM 1988-89 VI Batch
MAD: Module D: Personnel Manaaement
Objectives;
1. Determine and recruit £he personnel required for a programme.
2. Organise personnel to achieve programme goals.,,.,
3. Train personnel to prepare them for their tasks and provide
continuing education for staff development.
T opics
Introduction to personnel management, Manpower Planning, Selection,
Job analysis. Wage administration, Training, Staff movement,
fenageSe6trC<>dUIeS’ Frln9e ben‘,fits>
Resource Persons
Lr.Rajaratnam Abel, Dr.Thomas P. Benjamin, Mr.Mathew Asirvatham,
Mr.Immanuel and Mr.Mathuranayagam.
Reading
S.No.
''a.
Ref erence
rea
1 .
Agarwal, R.D., I.(Eel) Dynamics of Personnel
Management in India, ?.
~ A. of Readings,
A Bock
Tata Megraw Hill Publishing Company
New Delhi, 1 973.
General Reading
2.
CBCI, Personnel in Church Related
Institutions, Diocesan Press, 1980.
Selection
Wage administra’iion
Personnel
Policies
and procedures
Legal policies
in Personnel
Management
3.
CMAI, Employees Service Rules, Hospital
Administration Section, CMAI
'
i
Legal policies
in Personnel
Management
Personnel
policies and
procedures
4.
Cuming, Maurice, VW.
’ , The Theory and Practice
of Personnel Management Heinmam, London, 1977.
Selection, staff
movement,
Wage admini
stration
5.
Drucker, Peter, fPeople & Performance: The
best of Peter Drucker on Management,
Allied Pvt. Ltd.
Ltd., Delhi, 1981.
General Reading
6.
Eimeran, Van, W., Engelbrecht, R., Flagle,
Ch.D., Third international conference on
system science in Health Core - Health
Systems Research, Springer - Verlag,
Berlin Heidelberg, New york, 1984.
Manpower
Planning
i
; 2 :
S.No.
Reference
■..■Area
7.
Ghai, O.P. , I'
Management of Primary Health
Care, Interprint
*
1985.
8.
Gish, Oscar, Guidelines- for Health Planner
The planning and management of health services in Developing Countries , Tri Med
Books Ltd., London, 1977.
Manpower Planning
9.
Goel, S.L., Health Care Administration
Policy Making and Planning, Sterling
Publishers Pvt.Ltd., New Delhi 1980.
Manpower Planning
10.
Gosh, Subratish, Personnel Management,
Text and Cases, Oxford, 1980
T raining
Exercises
11.
Hall, T.L., & Mija, A.,
A.5 (Ed)., Health
Manpower Planning, Primary, Methods,
Issues, General'■ reach.
Manpower Planning
12.
Kataria, M., Ramaiah, T.J., Kumar Shared,
Supply and Demand for Specialists Medical
manpower in India, 1983-84
General Reading.
13. Katz. , F.M., & Fulop, T., Personnel for
Health Care , Case Studies of Education
programmes, PHP70, WHO, Geneva, 1978.
General Reading
14.
^ar_9no?
Shlutor, P., Joerdsun, ACJ.,
Vogel, L.C., Savega King, F., Guidelines
for the Management of Hospital Outpatient
Services, Administration Support Unit,
Ministry of Health, Kenya, 1982.
Job analysis
15.
Parkinson, North Cote C., Rustbniji, M.K.,
General Reading
Business is people, IBH Pub.Co., Bombay,1983
16.
Pettman, B.O., Tavernier, G., Manpower
planning workbook , Gower Dress, 1979.
Manpower Planning,
Selection.
17:.
Ray, D.K., Shipp, P.J., Hall, T.L., Gui
Guide. lines for Health Manpower Planning, V/HO'9
Geneva, 1980.
Revision on Module
D? Personnel
Management’
18.
Rao, N.P., Human Resource Development in
Management and Administration, B.R.
Publishing Co., Delhi, 1986.
Training
19.
Rustomji, M,K., Getting Along better with
General Reading
people, IBH Pub.Co., Bombay, 1982.
20.
Rabey, Garden P. , Staff Selection,
Dialogue, 1988
Selection
21 .
Srinivasan, S., Management. Process in
Health Care, VHAI, New Delhi, 1982.
Manpower Planning,
Job analysis,
Staffing
1
:■ 3
:
Lesscn Plan
1
2&3
4
5
68.7
8
9
10
Pretest & Introductory Lecture
Dr. Thgmas P. Benjamin
f
Manpower Planning ~ Exercise
Dr. fhomas P. Benjamin
Job analysis - Exercise
Dr.Rajaratnam Abel
VJage /administration — Exercises
Dr. Thomas P. Benjamin
Training Assignments - Submission
Dr. Thomas P. Benjamin
Personnel Policies — Lecture
Mr. Immanuel
Legal Matters - Lecture
Mr. Mathuranayagam
Selection — Promotion
11-13
Reading
14-16
Presentation of Debate topics
Topics for Debate
1. High salaries aare the ; best motivators in
Community Health and
Development organisations.
2. Trade Unions are a hel p t o M a na g e men t
3. The need for staffing should be determined
by the line staff.
4. Performance appraisal is a boon to management.
5. Internal seleccion is bettor for promotion.
6* comninf-v1^1?^
®oci91 security are a boon to workers in
community health and development organisations.
WUiKers in
7. Community volunteers should be paid salary by the organisation/
government •
8. Selection from a panel of applicants is
superior to selecting
known candidates.
9. community volunteers should be selected for the community
Twojoorsons^for each topic, one speaking for and one speaking
against. Th:
The write up should be submitted'to th^
-coordinator at
the end. Each person will be ‘
given only 10 minutes for speaking.
E valuat ion
Evaluation will be continu >us iand marks will be allotted
for attendance
to contact sessions, group discussions
J,
tests?
exercises?
debate and
assignments.
' •" the Administrator
a
1
Role
1. Analyst
2. Planner
3. Change
agent
Knowledge
Ability/skills
Attitude
Value
A good analysis is
a useful aid for
making decisions.
Survey method and
statis sics
Collecting and analysing
data
Willing to search
for information
Prineipres and
knowledge of economics,
logic y psychology,
sociology, health care
delivery system
Planning principles
Trends in the health
care, economic,
political and
social sciences
Assessing trends from
relevant data
Feeling comfortable
with figures and
opinions
Relating objectives to
planned programmes
Assessing strengths and
weaknesses realistically
Foreseeing possible
unintended outcomes
Developing programmes
within constraints and
available resources
Involving a large number
of staff and community
in the planning process
Plans are necessary
Desire to project
guidelines for
the past and the
action. They trans
present into the
late philosophy and
future
objectives into
Desire to work
realistic and work
towards accomplish able services
ment of objectives
Desire to put philo
sophy into practice
Initiating change
How change occurs in
societies , organisations ’Involving people in
systems, groups etc>
change
Relationships,
Desire for a pro
active, rarher than systems, organisatsocieties
reactive, response to, areions,
not
permanent
pressures.
and rigid. They
are liable to
change
'7
: 2 :
/.ole
Knowledge
Ability/skills.
At citude
How to introduce and
sustain change in
organ!cations
Analys ing change needs
from all points of view:
the system, the staff,
the patients, relatives,
and the community
Openness to change
in oneself and in
others
Mo desire to mani
pulate ethers
towards the changes
one wants
4. Resource
linker
Locating and relating, in
Information of all
a collaborative fashion
agencies and groups
with health, welfare and
related to the
health care institution other agencies and
groups of people of rele
vance to the institution
5.6,Interpreter
and Commu
nicator
Principles and pro
cesses of communicat
ion
Factors that influence
people’s undersbanding
Channels of communi
cation
7. Educator
c
Principles of learning
and education
Learning methods
On-the-jcb learning
techniques
Value
Desire for sharing
Collaboration rather
and collaborating
competition for
with others
people’s health care
The view that dupli is a major contri
bution to health
cation is expensive
services for the poor
and, in the long
run, not helpful
Listening
Speaking clearly
Expertise in the local
language
Ability to put oneself
in the other’s shoes
Willingness to eli
cit and share views
and perceptions of
oneself and others
Guding the worker in his
job
Identifying people’s
learning needs
Secting an example of
what is asked for
Devising the most
appropriate means of
learning for the
individual or the group
Willingness to teach Work presents a
and presevere with
number of opportteaching efforts
inities for learning
'hey can be us’d
ior inquiry and
analysis
There is a need for
a wide understand
ing of and partici
pation in, hospital
affairs in ths
hospital and in the
community
: 3 s
Role
Knowledge
Ability/Skills
8. Problem
solver
Steps in problem
sol vi ng
How individuals and
groups look at
problems
Techniques of analy
sis for evaluation
of alternatives
Collecting and analy
sing data
Making decisions for
solving the problem
Attitude
Value
Problems are meant to
be solved or overcome
Fault-finding or blame
laying approaches to
problems are not help
ful in their solution.
An unprejudiced
problem-solving appro
ach^, the only desire
of which is improve
ment, is helpful
Involving all affected
parties in the process
9. Facili
tator
Psychology and behavi Creating a climace of
oural sciences
openness and trust
between individuals and
groups
Desire for open,
trustful relation
ships between
people
It is necessary to
create a healthy
climate qf openness
and trust if conflicts
are to be aired openly
and resolved, rather
than repressed and
buried
10. Coordi
nator
Systems and procedu
res that relate
positions and depart
ments to one another
The systems view of
management
’Parts1 mist be har
monised to produce an
excellent ’whole1
Principles of commu
nication
Writing reports and
assigning priorities
Designing and imple
menting new systems
and procedures
Speaking and writing
effectively
Directing individuals,
groups and depart
ments to see the
common goal
: 4
Role
•Ability/SkiIls
Knowledge
____ I__ m
WW1LI IB !»_■ 1
T---- - ■-*'
Attitlde
Va lue
—
11. T eambuilder
Techniques of team
development
Creating a team out of
a group of individuals
Desire io build
strong individuals
and evolve teams
of such Mutually
support!re indi
vidual
Respect for human
potential and
individual unique
ness
12. Chief
execut
ive
As planner, executive
and review: theory and
practice of management
sciences
How available resources
can be used more effect
ively through better
planning, organising,
staffing and reviewing
Desire for systematic
work
Desire for experi
menting with new
ways and methods
Resources must be
conserved and better
used for fulfilling
objectives
Principles of planning
organ!sng, staffing
and reviewing
4'
y
ert e
,c
Introduction to Management Theory
I
has been associated with industry.and
Traditionallyj management
:
It
would
be pertinent at this poirt to review^
cc.r.cmic enterprise,
*
and
relevance
of the Manager and management ano
the definition, role
its contribution to economic development, The manager is the dynamic 9
life giving element in every business, Without his leadership the
resource of production remain resources and never become production,
In a- competitive economy, the
L._ quality -and performance of the managers
determire its survival* Management is the organ Ox society specifi
, Management is the
cally charged with making resources productive.^
A
manager
is
some
one
who
directs
the_yvork_Q.f
people at the top.
the_^ork _Q,fi—
others and who, as a slogan puts it,
it. does his work by getting other
peop 1 e to do theix^s. But these do not tell us what management is
and what it does. These questions can.be answered by analysing
management functions; For management is an organ and organs can be
described and defined only through their function. The enterprises
can decide, act and behave only as its managers do •- by itself the
enterprise has no effective existence. Management is defined as .ne
art of "guiding.. tae_ activities of a group of people^JiQ^^d^_.tlie
achievement of a common goal, the art and science of decision max-ng
and ’"leadership1’.
The essence of business enterprise, the vital principle that
determines its nature, is economic performance. The first function
of a manager is therefore that it is an economic organ. (The ultimate
test of management is business performance. Achievement rather than
knowledge remains of necessity, both proof and aim of management.
Management, in other words, is a practice, rather than a science or
a profession, though containing elements.of both. No greater damage
could be done than to attempt to professionalise management by
licencing managers, for instance, or by limiting access to management
to people with a special academic degree).
The second function of management is to_make_a_productive enter
prise out of human and material resouxces. Concretely this is the
function of managing managersc
and work. This implies
Jhe third function Jjl to. managej workers
make
it
most
suitable for human
organisation of the work so as co
as
to
make
them work most
beings, and organisation of ped le so
productively and effectively.
Traditionally even in the business enterprise, we were given to
thinking that resources including fixed capital like machinery and
variable capital like materials and men, who represent human resources
and who represent the non specific know-how input, together with
specific inputs such as promotional effort, coordination^and control
by governmental organisations and agencies would automatically leao
to rapid economic development^ but, unfortunately, that has not
happened. The missing link, is management.
II
Historical analysis has shown that it is not just material
resources alone that contribute to rapid development. According to
Solow Abremovitz, between 80-90% of the growth of output^gjr
achieved in the American eco nomy oyer the last cento-- the men mannirg
accounted for by increases in capital
Keys to rising productivity
and
was also the result of
dec-^ntrn 1 i c j
Perhaps, the mystery of development
mabbe
by the rediscovery of the tremendous potential of
- 2 human resources in general and the application of the principle^
of management in particular to a variety of production, regula
tion and control service and public administration ta
Jean Servan-Schreiber, a noted French writer, in his book,
Am e rican Ch a11eng e, has a rgued that the United States rose to
technologically, economically and
reSU1±gcon
importantly in turn from investment m human reSl^^es. U
centrated on the training of human resources, particularly in
management and introduced and enforced appropriate and-vigDurou i
functional organizations and systems in business, industry, t
public utilities and public administration.
Ill
extent of as much as 50%. This has nothing uo do with lack 01 fp£'-cial and physical resources. It is a simple but remediable de^rt..
of managerial resources -■ leadership, organization and systcms.
Application of modern management concepts and techniques which,
ifPapplied with care, could magically improve capacity utilizer
.
and reduce losses. But the resistance to such concepts m public
and associated government departments, which have a strong tradi
tion of public administration designed for earlier and obsolete
objectives, is so strong that it may take years to reorganise these
bodies along the right lines.
At this stage I would like you to reflect on the.status of
many mission hospitals in the voluntary sector in India today.
Some of them, I have had the opportunity to know and ai^lyse. n
Most of you would by now have a greater knowledge and understand
ing than I have had. My own-experience indicates that the average
bed occupancy in hospitals is about W- . We have about 3°
|
per• 100000 population on the one hand while die national indicator
of health in our country ,is IMRJL20 per
.Lj 35/13;
life expectancy at birth 52 years;
birth rate to death rate
.
born
below
percentage of infants
------- birth weight 30, in the year 1981.
This, in my analysis is duetto> the lack of managerial appliof social relevance of professions. . Thouga
cation and the lack c..
individual professionals are neither selfish nor petty in the
innate sense, the way their educational skills and values are deve
loped, compels them to look after their own career interests and
career survival at the expense of the masses. Each Profession w:^_k
under a given system. The system derives certain skills and values
from the education and training base. Thereafter, it assumes cer
tain postures in relation to the society in tune with the organi
zation and norms through which the profession operates. Thus, the
values of the educational and organizational systems. Do theofc
values promote a code of ethics and service to the society as the
main motivation or do they stand in the way of individuals iu obser
ving these norms, or does the system induce values to bh^P^det^
sion? Since the motto of the profession is service to^.^ be guch
the structure, content and values of a prof^ly ft can qualify
that it serves the largest mass of pe^ie*
itself to social relevence.
J
I
- 3 -
S;
in ’tliis issue of s.cial relevance into this Vlk today
Friends, X b ught
f..rroos.CSI
.K uhiquo to hihiont. s tut'ylhg In this institute. T..0
hosrit-ls in th. nolunt.ry so.tct
rrofosni nols » rtir.g in then have tno
g^tost opportunity to
to. serve —...
si0„ S. Ms' for «W. TM
nission
fo
spitnl
Th e ni s s i o n h spi t n 1 syston
sy s ton is poamd to sorz. th
h-ssgs
You will be the nonagers
managers ’of
of those
these hospitals. Xr yr'u can use is .
^ten’and-nractice
functions of these msand'practice the
the principles
principles of
of management
raanagenent in
m the
t
■
SJS "
vcst0rf vdth the potential and the unique opportitutions, I believe ..you are ’.------- -■
I am introducing
tunity of trorisf wing the health status of this country.
this belief and I hope the series will
t0 you the theories of nonagenent with
T-he task of management in the voluntary
benefit you as practicing managers,
t0 ask the right questions and define the
health sector institute ns will be
of services, define performance standards fclevmt
relevant structure and systems c_ be achieved in the country, and
t0 the organization and health standards to
and managers of the different functionaries of the
organise the wcrlc, workers
said organization.
it will be necessary to understand, the
T o understand raanaggment theory,
History is divided into three successive periods,
hi story of soci al organi zati n s.
of industrial resolution, and the modem period
the mediaeval period, the period
outstanding feature of the three periods is its.state
of macs precution. J- he j - it is also important from the point of
of technology. For management science,
of the social org-nizatlon in each period was also
organizati ns. The state
7- ’ay most of us live; work and play as members of well
signiflcantly differ.nt.
These signs of org^ised activity are chiefly a
organised groups of people,
society has made to adapt itself to the race of science
reflection of the attempts
and Enology. Progress takes pl^o through■i science and technology on the one
T he full potential of various s’-eciohand and social organizati n at the otner.
=o,-once and tochn logy, cannot be attained without a s-czol
lisotioBs, including
consciously adoptee, to the purpose of fostering skills, eb.ci
organi zati on
each suited to the specific objectives. S ccial ro-naznaptitude and talent kinds, each with its own goals and objectives. J.**e offecth ns are of numerous kwus,
the quali ty of the grginization, systerns tiveness of such groups depends upon
management, leadership etc.
Eovmcr
Fra th. o.rly coherth,
heiohct
6 ’f
T ho
c-poroti 5
or
r^t. ttat «. Kf.r t. as
«.d .for
Ksoarrt, ..nthoMtlwl eoonooxos, th- X*."j
rwAol <7,
. .......... .. uh^ny f^ PhyslM1
sociology, anthropophysiology and s< on.
above sciences in its area of — —-
.to
>
i
>
I'
I.
- 4 -
L et me illustrate a few instances of hew the di ffewntj. disciplines have
contributed to nanagenent theory.
In the late 1880*s two eminent mechanical
\,^rS Henry fl. T :vr.o& Fredrick 31. T ayl r, started what is gener Uy
Kferred I as the scientific nanegonont movement. T-aylor is better known
!
the father of the movement. T nylor improved management methods by
Lasising the concept of work measuranent. He d vol oped the techniouos
’ r/ut
onti . StuCy. ho pi^oa
« the to.U 0
„uontltios, dosignod <000 ir.oo.Uvo schonos, and tooKloc Ho t.«Vr —■
■t offlonizlno eo»rlox nonufocturioo ooUvltlos. later Prmk «. U1 W»
Gilbert and Henry L. Gantt contributed to production management methods.
Henry Fayol extended T aylors concepts beyond the field of product! n.
Fay 1 worked as a mining E nginoer and contributed to management with his
findings for isprovonent of his industry.
He class ified the activities o
the company into technical, commercial, financial, security, acccutmg ano
Managerial activities. Each activity was to perform certain functions.
Tjie managerial functions were classified into planniiig, orga.nising, ^tefiU..,
i
diseefing, controlling and cggrdinaling functions. He further advocated
certain principles for the management of the company. Division of^orR,
I
delegation of authority and re_s-cnsibility, discipline in the organiza.ion,
TOity of command, unity of direction, subordinatipiLgfindividual interest
tc .organizational Urterest, fair ru.!unaraticr._£f_gprsonnel, job securi ty,
Qc?iity, and c-crtuni ties to use initiative .wore,jsokg of the principles Faye 1
advocated for the industry. His ccntributicn has new become universally eppli-
c.ablc, to all social org nizaticns.
Mary Parker Follett applied from F schycho 1 cgy p rin ci p 1 es the t havc r, ff cc*
the nsturtf of iiinnt'.cj-incnt in industxi cs. In ividual and orgpjiizaticnal dcvo-
lopment according to her d^ends on five basic varirbles,
variables, confimjres-luti^
author! ty^structurc, deci sipn making processes, leadership styles and coor
dination of activities in the .
’
Frank Si lb re th itir roved on the, concepts of time and motion s tody and
for individuals in the organization. T he best -erson
arjvc,cated career plans
given position, the organization must be.oblc to
ghoul d be attracted for a
master plan for promotion; as part of mon-'Wc?
hold the person and develop a
planning.
Chester Bernard’s contributions were primarily relrted: to the
~
t
. of the Grief Executive particularly in the communications funct.
functions o
nf thu executive* The
T„ „et «.-» W ho
r»“ss of “o
- 5 -
cranunicote; communication de-cnds on h -Wfar the executive cm
persons needs, goals, resources had limitations; tte executivejnust develop ?
good feed back system; and the executive must belieye that ■em-'lcyeos will oventu lly internalise thejnessages.
Edward K. Strong, Abreham Kaslow, Niel Killer, Fredrick Herzberg and
John Dollard were Psychologists who have contributed to management theory.
The more vjell known theory is that of Usslow, the thecry_pf hierarchy.:£nbds,
Blaslow .classified human needs into physiologUal, ^ofcty4 2cye_^d_b«12ESr..
ingness, self esteem, and seKjctuuli^i^ • E10SU noads of thc ^dividu ol
strongly affect their performance in the prg nizati.r and th ci r inter rela
tionship with each other. These concepts have directly influenced moth-ves
of job sped fication, Job .content, job rotation and job enrichment. Dctigl-s
Kcgregor in his book. The Professional Manager contributed to the theoryjr
loadorshijii Mcgrcgdr classified icadershi- styles into the ’X’ and T. types.
The tX’ type leader considers that human beings are n t hard worldngj c n't
nake decisions, are n n cooper tive, and thus the manager tries to be very
strict, punishes workers, takes docirfons himself and have close supervisi-n
over subordinates. I he ’Y' type of leader assumes that men are busierlly
hard w rking, like to accept resac nsi bili.ty, want to t-ke decisions and arc
creative. The manager accordingly provides challenging wr rk si tu-tiens, ’ rovides orr rtunities for ros'-onsibi lity and participation, has an c-en system
and leaves the control functions to the employees. This theory has been
refined over time into two basic len'ership s tyles, task oriented and rela
tions oriented styles uirich have been classified into five mmag.ment stylos.
The situational theory advocates the use of the appropriate management style
for the situation prevailing in thc organization at any point of time.
Prof. P*l'-S. Bolachett in 1940 introduced the basic concepts of creroticns
research f r, de ci si on m-Jri nc;. It was first a plied in defcnc,.. ./.1th: ug.. it
was: concerned at first tri th technical prcblems it quickly became embe’de with
what was essentially management prcblons.
Mrnaganent tiiecry continues to grow and with thc advent of computers, s-av
of the. concepts that were only thecritical have now been out into practice..
Tools for deci si n making has become pre cticol tri th better in format!or. systems.
y
In t»w commercial end manufacturing sectors of ur c-untry, m-nsgement
has made a fair headway'. Suring the last two decades, formol training has.
equipped personnel in this sector with ccntcnpoyary management skills. This
h-s resulted in improved -uromance of some f the commercial and m.-nufneturing undertakings. However, even in industry, the progress has been confined
only to the modem sector of business and inrirtry.
S mall scale industry ns
! .•
-6--
-
well as traditional industries have yet. to Leno fit fr r» nccicrn naneg orient s.
also in health, energy , transport, education and other.vital sectors.
Hovj cnn we intr c’uce m'inegaaait an d m-n ag xien t ski 11 s in th o ho al th s ec to r
In the health sector, vcluntnry erg-ni so tic n s, government - both st'tc
n d contr 1, rri vote nursing homes onrt. hospitals md inclivi du hl'nrncti tinners
Xe involved in the rrcmoti-n of b- Itii in the society. Every individual w-tf:-
■ jng in these instituti ns has a specific job and role to perform in fulfilling
their organisational bjectives. Every j b accordingly contains specialisation
• c^ rent and a group component.
'
The rroorti-n between the specialisation and
the grour component in a given mix will vary from job to Job, level to level
pnd;industry to industry,. -Also the- specialisoti/n component decreases as the
level in the hierarchy increases* and the greu. component increases corres
pondingly. The specialisation ccmponpnt on the job calls for socialised skill
The efficiency of the group do-ends on the group skills aild management skills
of individuals.
Specialisation are of various kinds and categories :
a) Exrsirles of science specie.lisations
Physical and natural sciences, atomic sciences, space sciences.
b) Typical technological and engineering specialisations:
Civil, tele-communicati.n, meteletgical engineering.
.•J-
■
c) Technical sp<ci^lis pt ion J
Law, med cine, education, research.
(\) Sectoral s^cdtili sotion t
Purchasing, selling, accounting, recruitment.
In most cases specialisation will be a mix of the above kinds.
In the initial st,ges of o^s career, often individual performance is os
irapc tant as group ctivity. In this, case, most jobs contain a great deal of
specialisation. Which obviously, n^d specialised knowledge and skills, .or
improved group effectiveness, it is necessary that members of the grou- should
understand each other, learn to adjust and adopt themselves to each others
repuiroments: functional, professional and personal integrate one r.ncth.rs
activity into the total crg-nisaV.mnl functions and cenmunicate with one
.X-Xls gXtor. M >n inter stagos, group sldlls -U ^uoH, to- to
ZXX. ™os tuo S«n» «ob f<« tho eountorpurt of tboro =■. ro^r..-
Xts eon be torfod uooossory for group, offcotitmoss. 3 ha" d>ffcru«t spo^oHs^U-ns uro lor, Ivod In tbo
of.n group UMrouslug Itself to r. spun..!
‘tos/ tl.0 « rk has to bo nssH»«l
poroolloa out to affcrtut speoi.-l.sts ut
Xuu. -els.
«> •
ef org^s.Uouol
- 7 hove a be ring on the effectiveness of these groups.
Whenever a greup is given a tasLtc perform, one person has of necessity ,
to be ait rusted with the responsibility ' f di roc ti ng and centr lling the
rf?
of others both as individuals and as a. group.
-termed a manager.
This -ersen/^o directs and controls othe s, has a management component in
his job, besides the s• udnlisation component.
To fit the raanag merit component in job requirements, one needs managerial
skills.
Kanagcrirl skills can bo dividec; into throe ports.
a) Systems and technique skills
b) Human relations skills and
c) Concc tu rl skills.
Systems end technique skills help,
a) in th c cv luati on of opc * ati on al and cccnor.dc consequences of ypri ;us . •
courses of action in particular situati ns, any two c urses of possible
action being rtlovant to oo.ch other as alternatives.
b) in the ossc-ss^nt of the technical and aperati nal feasibility cf diff
erent proposals.
c) in the reduction of w^stc through Eiothcds imorovenent and r 1 annieg.
d) in the reducti n of cost th re ugh increased utilization of crpocit,. one.
productivity.
c) improve allocation of rosr ucos for optimum cifficiency.
f) control factors that have a bearing on costs and time schedules etc.
q) c -ordinotin of numerous activities and functions etc.
Human relati ns skills protide m underst rding o£humon beings and their
behaviour, and help, the functfcmry to get the best out of people in given sltuo-.
ti.„s
Specific skills associated with human relotinns skills are : crmnun?cati,
motiv'ti'^, leadership, counselling etc.
Concertual skills is the ability to understand the system as a whole - in
" j, the impact
terns of Hs component parts, the interrelatedness of component parts
of action directed on cne part
of one part on the rest of the ’'arts, the impact
----op present action for the future, etc.
on the whole system, the consequences
which calls for a great deal of maturity
It also includes perspective skills,
skill is also prcblom saving, diagnostic cnd^olyand judgement. Perspective t----of the conceptual skill.
tic 1 Skills. □Cdsi n making is the ultimate state
- 8 -
Schepatjc djogrpia of the relatjrn between gid 11 and...levoIs
in the orqonisati _n
Top
Concep
tual
Soni or
*.
\
\
\
J
\
Middle
Sped plization
■
■
.
\
Techniejie \
• \
\
Rela
tional
Junior
J cb con t on t / s Id 11
VII
Today, I have tried to talk to you on three broad areas •
a) The role and relevance of nonagaaent in general and the health
sector in particular.
’ b) The contribution to nodom management from different disciplines of
science, arts and technology.
c) The -otentiol for developing the necessary managoHal skills for
greater efficiency and effectiveness in y ur functions as managers
of hospit-ls and health institutiTns. Managerial skills can be
accuirod thr ugh
n the job-or -riporatory project training and
through formal class room instruction.
My aim for todey was to stimulate ycur interest in the persuit of manageri. 1
skills.
This I believe.will be an investment to the institutions you wish
to serve and the in rovan ent of health in the country.
<lanageiiient is practice*
A
ti pr-CLXj-' UL
JOB: MEANING, STRUCTURE. AND ANALYSIS
There is a confusion in the minds of many as to what constitutes a
job. This is due to lack of clear understanding of the meaning of
the term 1 ’’ob' . For some, job means a 'position' and for others it
means 'work' or 'occupation'. To accomplish its goals, an enterprise
or institution must organise its work into a number of jobs, each
with specific duties and responsibilities. These jobs, to be performed,
must be assigned to the members of the organisation. Thus, the two
essential tools of an organisation used to achieve its goals are the
jobs and the positions. With this background, we will be able to dis-^
tinguish and identify ''job ''' from other related terms. A successful
personnel manager will have a clear understanding of the terminology
involved in job analysis. .A task is a distinct work activity carried
out for a distinct purpose1. A person has to performs number of tasks
while occupying a position. For example, a salesman in a shoe store has
to dust the merchandise (a task) display the merchandise (a cask), and
deal with the customer (a task).
Jc.b Meaning
A position is made up of a number of tasks and occupied by an
individual at a given time. A position is an aggregation of duties,2
tasks and responsibilities that require the services of an employees .
For example, Personnel Manager is a position occupied by one individual
in an organisation. In an organisation:
No.of positions = No.of employees.
A job consists of a number of positions similar in nature. The
Bureau of Employment Security defines
a job as a group of
positions which are identical with respect to their major tasks,
Davies 4, the content of a
duties and responsibilities^. According to Davies
job comprises the following:
1 . Work Content: The assigned series of tasks which arise from the
requir ments of the technical process or the equipment used or
traditionally established needs.
2. Methods content: The specification of the ways in which the work
activities are to be performed, including tools, equipment and
location. It is ofcen referred to as methods design.
3. Organisation Content: The organisational setting in which the
assigned tasks are to be carried out, for example, the location
of the job in a group hierarchical relations, and so oh.
4. Personal Content: The factors in the job that affect personal
behaviour, growth, motivations etc.
While only one person is assigned to a position, more than oneemployee may be required to perform a job if the work load of that
job is heavy. For example, in a sales house, we may see more than
a salesman performing similar duties and responsibilities, though
each of whom will occupy a separate position. The role^an individual
plays in an organisation is determined by the job to which he is
assigned.
1. John B. Miner, Personnel and Industrial Relations, The MacMillan
Company, New York, 1969, p.158.
rity, (U.S.A.)
(U.S.A.), Training and Reference
2. Bureau
Employment Security,
Government
Printing Office, Washington,
Manual for Joo /analysis, C_.-_
1965, p.7.
3. Ibid.
4. Louis E. Davies, "Job Design and Productivity: A New Approach,"
Personnel, Vo1.33, March, 1957, p.430.
: 2 :
An occupation consists of a number of jobs, The term involves
the very nature of the activities bjeing performed 9 their level in an
organisation, the importance of the results, <and’ the skills, aptitudes 9
abilities, knowledge, education and training necessary for their
performance^.
The term 'job' and ’work1 are viewed as synonymous and used interchange ably. V
When they talk about a person who holds a job in a company,
some people have the habit of saying' 'he goes to work', A job involves
work. Work is the activity in which a person exerts his physical and
mental strength in order to do something useful for some form of gain 9
usually pay6.
On the other hand, a job is made up of duties and res
ponsibilities . In carrying out these duties and responsibilities an
individual exerts his physical and mental work. Certain jobs involve
more of a physical work (Ex.laborer) than mental work, jobs
Jobs such as
clerical and administrative type involve more of a mental work than
physical work. The degree of physical work varies according to the
job. For instance, most of the unskilled jobs (common laboring work)
involve heavy physical work such as carrying heavy loads and supplies,
digging holes, and so on . Often the amount of physical effort involved
in a job is used as a measure to distinguish between white-collar j'’-s
(administrative, professional, executive, clerical and staff) and b. _ecollar jobs (unskilled, semi-skilled and skilled).
In whatever line or field the work is performed individuals assign
various values to 'work1. For some, work has a great monetary value
because it is used as a powerful tool in fulfilling most of their basic
needs. The people whose physical needs (Maslow's need hierarchy) hav:
not been completely fulfilled, attach greater importance to the mone
tary value of work. There are some who consider work as a source of
psychological satisfaction. Such people, if they don't work, feel
lazy and experience boredom and mental fatigue. Most of the Western
countries, founded on Weber's 'Protescant Ethic of Work' find spiritual
value in work. According co this value, a man who. works hard will
never be in want, whereas one who is lazy in everything, even if he
is rich, becomes poor. Perseverance and resourcefulness are necessary
for success in life. As Weber' saw it, before the Protestant Refor
mation, the ideal of tne ousinessman was to conduct his business in a
traditional way, do the traditional amount of work, and make the tradi
tional rate of profits- fne idea that he should increase his rate o^
profit by adopting radically new methods or by clever competition
would have appeared immoral to him.
In some societies work is regarded as simply a means to an end.
This is true in^many
in many under-developed and developing countries. The
Hindu soci
Places high■ value on luck and fate as elements of
S UCCQ-oo •
An average Hindu does not stress individual progress or
success•
unquestionably whatever hi$ position in life may
be. If he is7 poor
*
be^.believes that poverty is God-given and he accepts
poverty as his lot’in life.” LSimilarly all other positions in life
enjoyed or suffered by- an individual are accepted as they are, and ha
feels that anyeffort
;
made to change this position in life is futile.
Thus , this
’
attitude puts restrictions on hard work. The attitude of
Mexicans towards work is thatnis a means one utilises simply to provide
the funds 1necessary
---for achieving a desired level of living. Megginson classified the'various- views
—..o of work into two ways:
5. Leon C. Megginson, Personnel - A Behavioural Approach to Administration, Richard D. Irwin 9 Inc. 9 Homewood, III., 1972, p.565.
6. Ibid.
7. Max Weber, The Protestant Ethic and the 3.,;
Spirit of Capitalism,
translated by Tolcott Parsons, George
Allen
“
1
"7
'
& Unwin, Ltd.,
London, 193.0.
: 3 ;
First, it is considered to have intrinsic value; thus, through its
performance men receive pleasure and asense of self-fulfilment.
Second, according to the extrinsic concept, work is not satisfactionyielding within itself, but it is a means o£‘ obtaining satisfaction
eisewnsro. Thus work is considered painful •
Of course no one can deny that the concept of work is changing.
The under-developed and developing countries have began ^o place
more-and more value on hard work. They realise that it is the on y
wav to achieve economic growth and progress. On the other hand, in
well-developed countries, people seek leisure to get away from th
pressure of work by advocating throe-day or four-cay work weeks. 10
make people to get involved in their jobs, many authorities m the .
field of organisation behaviour advocate for restructuring or re esig ing jobs.
Job design
Tnh Hp^inn means specification of the contents, methods and relation-• ■ ; in "order 'to satisfy technological and organisation requireships ■of- jobs
well
ments as v.-ll as the social and personal requirements of the job
holder .
The Bureau of Employment Security defines job design as the process
of specifying the concent of a job (work, methods, organisational and
personal content) in terms of a job defini ion or a job description^.
\ poorly designed job may cause number of problems, such as, low pro
IKiSly, high turnover, poor
neeldenuond .0 «. It « tn.
■rpqoonsibilitv of a personnel manager to see that tlv job^ m ms
oro-nisation'contain the necessary contents for achieving employee
productivity and employee satisfaction. He must up-date or rec.esign
the jobs according to the environmental Ranges, whether technologicai,
sociological, psychological or economical. While some theorists
advocate he job simplification, concept, others recommend the job
enlargement concept in designing j^bs.
Job Simplification. Adam Smith11 recommended two.concepts to
achieve economic growth and increase the.wealth of Nations. These two
concepts are the division of labour ano job specialisation. According
to Smith, by dividing the work of the entire labour into smaller seg
ments, the job of each employee would involve the performance of fewer
and fewer operations. Since the worker would be repeating the.same
simple operations day by day, eventually he would become a specialist
in his job. In other words, Adam Smith was advocating for job sim,.
fication, a job with fewer duties and responsibilities. The same
concept was emphasised by Taylor and Gilbreths in tte-ir Time and Motion
stales. The purpose of these studios was to eliminate the unnecessary
motions involved in performing a j-.b and thus , to s im Aify 11, incr a ing efficiency. Most of the mass-production mdusuxies find t-io
concept very useful
8. Leon C. Megginson, Op.Cit., p.566.
11
Vol.5,
9. Louis E. Davies, "The Design of Jobs 9 Industrial Relations,
October, 1966, p*21.
tQ. Bureau of Employment Security, (U.S.A.), Training and Reference
Manual for Job Analysis, p.7.
London, 1901.
1 1 . Adeem Smith, The Wealth of Nacions, G. Bell & Sons,
TT
: 4 :
Job Enlargement is another concept considered in designing jobs.
It is the process of allowing individual workers to determine their own
working pace (within limits), to serve as their own inspectors by giving
them responsibility for quality control, to repair their own mistakes,
to be responsible for their own machine set up and repair, and to
attain choice_ of method^,j The purpose of job enlargement is to offer
challenge, interest and meaning to the worker who performs a job. This
purpose is achieved by expanding the dimensions of a job horizontally
vertifically.
When duties and responsibilities of a similar nature are added to
a job, it is known as horizontal enlargement. For example, if the
assembly of a part or a product, or a process involved three or four
operations, the employee can be trained in these operations so that he
can be rotated on each of these processes or operations. Another
method by which job enlargement achieved is by vertical enlargement.
Under this method, additional duties and responsibilities are added
to the jobs. For instance, besides assigning an employee with the
duties and responsibilities of making a product, also giving him the
responsibility to check the quality^^and inspect his own work. The 1
advantage of job enlargement is tha t?lJoreaks the monotony result/from .
repetitive task. It makes the job more challenging and interesting.
When an employee gains knowledge in making a complete product rather
than a part of it, he finds more moaning in the job and realises his
contribution. Under the traditional repetitive task method he is unable
to perceive his role. In their well-known study, ’The Man on the
Asembly Line1^, Walker and Guest found that most of the workers they
interviewed regarded the assembly line job as undesirable because of its
repetitive character. From their study, the authors concluded that the
more variety a job has, the more interesting it is to the worker.
Krech and Crutchfield‘S contend that repetition required by assembly
line production imposes too much discipline on the worker, thus giving
rise to tensions. Some studies have shown chat job satisfaction
is higher in enlarged jobs while repetitive tasks cause boredom and
dissatisfaction. Job satisfaction is another concept which is closely
related to job design^
Job Satisfaction. In many developed countries most of the people
have surpassed their physiological needs and are moving toward hiefc ei
level needs of Maslow’s need hierarchy. The importance they attribute
to money is not the same as they oncu did. Their goal has been shifted
from money to the job. A man’s relationship to his job has changed.
He is motivated to perform his job better by the satisfaction he
derives from job. Job satisfaction doos not result merely from the job.
There are certain factors which influence the view an employee takes
of his job. These factors include the individual vocational choice;
selection and placement on the job; the physical environment of the
job; the extent of the knowledge of the purpose of the job; the size
and layout of the work area; the typo of work performed; the length
of uninterrupted toil required to perform the job; the extent of the
knowledge of what is going on around the worker, including the
"grapevine", formal communications systems, and informal groups; the
12. Charles L. Hulin and Milton R.Blood, "Job Enlargement, Individual
Differences, and Worker Responses,” Psychological Bulletin,
Vol.69, January 1968, pp.41-42.
13. C. R.Walker and R.H.Guest, The Man on the Asembly Line, Harvard
University Press, Cambridge, Mass., 1952, pp.38-65.
14. D. Krech and R.S.Crutchfield, Theory and Problems of Social
Psychology, McGraw-Hil Book Co., Inc., New York, 1948, pp.539-450.
s 5 s
personal and social relationships of employees; and the employees1
fears and anxieties . The two-factor theory formulated by Herzberg 6
states achievement, recognition of task work itself, responsibility
and advancement as the factors of job satisfaction. Study of indivi
dual needs through attitude survey may be a method of determining the
conditions that provide satisfaction to workers. Many business organi
sations utilise standardised questionnaires for assessing employee
satisfaction. The findings of some studies (Vroom’') reveal a negative
correlation between job satisfaction and turnover or absenteeism. In
other woros an employee with high job satisfaction is less likely to quit
the job or to be absent frequently. While Vroom'° held the view that ■
there is no positive correlation between job performance and job satis
faction, Porter and Lawler 7 concluded that job performance leads to job
satisfaction. This view of Porter and Lawler is also supported by
Slocum*
Slocum^ who has reviewed several studies in this field, besides conducting his own study.
Certain conclusions can be drawn from these and other studies conducted on job satisfaction. A job must be meaninoful in order that the
performer of that job may experience satisfaction^ In designing or
redesigning jobs, a personnel manager must take this factor into consi
deration. He must be careful and analytical in using techniques and
r hods to induce or to increase satisfaction in his workers. In other
words, he cannotfsimply transplant the methods used in other companies
or commercially available ones. Ho has to study the needs and wants
of his w? ik force scientii ically m order to apply any method. A
careful analysis of jobs, the next topic of consideration, would be
of great help in redesigning jobs.
Job Analysis
In the early 1900*s job study was job analysis. The Taylor group
used i.he Time s^udy approach and the Gilbreths, the Motion study
approach to study the jobs. Around L'Jorld War I, job analysis was
viewed as the process of establishing the component elements of a job
ano ascertaining.the.human qualifications necessary for its successful
performance. This view appears to be the combination of time and
motion study approach. Later in 1927, Charles R. Mann of the American
Council of education.said, "To me job analysis is a process, an
approach to a situation; the job description or specification is the
result of that process”.
^4
mc^ern bays job analysis is viewed as a systematic and scientiixc procedure for securing and reporting information about a specific
Joo. The U.S.Department of Labour offers a good definition of job
analysis:
15. H.G.Maule 9 ’’Work: Pleasure or Penace?” COccupational Psychology,
Vol.30), No.4, October,
October 1956, pp.232-241 .
16. Frederick Herzberg, FBernard Mausnor and Barbara B. Synderman
The Motivation to Work
_k? John Wiley. & Sons, Inc., New York, 1959.
17. V.H. Vroom , Work & Motivation, John Wiley & Sons,9 New York, 1964.
18. Ibid., Chapter 6.
19. Edward E. Lawler.9 ard Lyman W. Porter, ’’The Effect of Performance
on Job Satisfaction.i", Industrial Relations , Vol.7, No.4, Oct., 1970,
pp.431-436.
20. John W. Slocum , "Performance and Satisfaction: An Analysis,"
Industrial Relations, Vol.9 , No.4, Oct.1970, pp.433-436.
21 . Charles Vi/. Lytle, Job Evaluation methods. The Ronald Press
Company, New York, 1946.
4
: 6 :
^OnatS“?naasictfS'
job from all others^P
1 performance and which different! ace the
j°b.a°f.P«tlnont Inforis
forms. One is called aa This information ^.recorded
in two different
job description and the other is j;bb specific
cation.' There
is some
r---- -.
canfusion between the ,ftwo~ terns
‘
in ■’ some circles.
As a result of this confusion
confusion,” some
some use these two terms
--; interchangeably.
To avoid this type of-confusion, let us define these two'
termsV 9 lex
Job Description
Dealing'With job
Job Title
Duties and Responsibilities
Tools, Equipment used
Work Conditi ons
Hazards Involved
Job Analysis
Job Specification
Education
Experience
Specific Knowledge Requirement
Personality Requirement
Skill Requirement
Dealing with Applicant
Fig: Two Parts of Job Analysis
Job Description
It is a written statement of the tasks
working conditions and behaviours
elements of job description are:
sSS’^soSsalor^t?130"'181- DelJt’
dutioc
responsibilities,
Job. The various
Defert^rtt,
In large organisations, these locations must be specific:
Example: Supervisor - Dealer sales, Domestic Marketing Department.
p*"’" °f
-P-vUor
Example: For Secretary-Personnel Manager.
Manager.
For Supervisor-District
Summary Statement of Job.
use to give the reader a qulekricaeps5i:‘5p?^:tfi^eojOthr^ntont°of9reat
the job.
Example. Secretary: Job involves taking dictation, typing, maintaining
ano preparing records and correspondence.
22. Department of Labor, United States Employment Service, IOccupational
'
Analysis and Industrial Services Division, Training and Reference
Manual for Job Analysis, Juno 1944, p.1. .
dJ-niny anG iterance
: 7 :
Jufies of ‘the Job. A detailed description of a job is on impori—
ant asoect of job description. This will give a picture of what
the joj holder does and how he performs the tasks.
Equipment, Instruments, Machines and Tools Used. Materials, tools and
instruments used in carrying out the tasks must be listed. Also
machinery operated.
Example; Secretarv: Typing copy machine, calculator
calculator, etc.
Working Conditions. Complete description of the physical working condi
tions must be snown m the job description. Some of the factors in
the work environment areheat, light, noise arc! ventilation. Some des
criptions induce working hours and hazards involved in performing the job.
Job Specification
It is a written.statement of personal qualifications that an indi
vidual must possess m order to perform the duties and responsibilities
a particular gob. The various elements of job specification arc;
ducational Requirement. Minimum formal education necessary to perform
u particular job must be noted in the job specification.
Example: Supervisor; High school completion
Experience. Minimum experience required to perform the job.
Specific Knowledge Requirements. This includes specific knowledge tha;cannoc be covered adequately by the education and experience requirement.
Example: Dealer sales supervisor; Knwolodge of dealer sales marketing
and supervisory experience.
' y
okill Requirements. Manual skill required to perform a 1 b.
types of job demand manual dexterity.
Certain
Personality Requirements, fFor certain Jobs personality factors such
as personal appearance, emotional stability m-turity ? initiative ? drive
and sociability are required.
nesppnsibility. The ability to assume responsibility is an essential
salification required of an applicant for certain higher level jobs.
xhis responsibility may be supervision of others, safety of others,
operation and maintenance of equipment, tools and so on.
Job Analysis
hno rxo?
£U2ial ?reas
state of Punjab, India, the government
has established primary health centres (PHCs) to provide both curative
and preventive services to the population. Each PHC is theoretically
serving 30,000 people. The facilities include the main PHC head
quarters and six subcentres. The staffing pattern (simplified in this
example) consists of the following;
Male Medical Officer (MO)
. 1
Lady Medical Officer (LMO)
. 1
Lady Health Visitor (LHV)
(Supervisor of ANMs)
. 2
Auxiliary Nurse Midwife (ANM)
. 8
Health Inspector/Educator (HI)
(Supervisor of MFWs)
. 3
Male Field Workers (MFW)
.15
30
: 8 s
The major areas of Tr^P°n^bility (functions) of the PHCs are
care of ill persons. (ILLNESS CARE)), Maternal and Child Health (MCH),
Family Planning (FP), Ma
Malaria,
lari
Smallpox, IB Control and Environmental
Sanitation (CDC + ENV).
the.activities of the PHC
PHC staff
staff are
--- 1 categories of staff the
the major
wttrday pei
Table 1
Minutes oar day nor worker
(Estimated & Rounded)
Type of staff
;4mr*=nrka
Function
Illness
MCH
FP
CDC+ENV
T ot al
n,t m
i»..-
in.... «
ANM
LHV
100
90
120
20
90
90
150
40
330.
370
MFW
HI
MO/LMO
10
20
10
130
200
250
40
60
30
70
260
340
360
380
1* calcSlaJe
^he above table and the PHC staffing pattern
all Staff in earhaJ
Spent per day *-ierforming each functi-n bv
a 1 staff m each category and the tobal for all PHC QtS-p-p
enter these values in the following cable:
1Staff and
Table 2
Minimum per'day per PHC
(Total of all staff)
Type of Staff:
Function
ANM
LHV
K4FVV
HI
MO|LMp
Illness
-MCH
FP
CDC+ENV
T otal
2. Determine the column percentages in Table 2 for each staff oa + n-ta-rv
the totafof tho!"fi"ctl^s.the
p3rcanta9e for «=h function and
3. inbthp°^^n^ ?^fc?edPefun<?G between the five categories of staff
a-xx
untuxb
j-ouqe tneir
ut4.
m the,,,and
distribute
their time. Which
of the staff categories
would you classify as having jobs with a limited number of areas
of responsibility? Which category appears most multipurpose?
4. For each function identify the staff category contribute no the
least amount of time to that function.
7
mutiny the
.L
*0
: 9 s
5. Currently ANMs are trained primarily in midwifery in a hospital
setting. Whac changes would you recommend for the ANMs curriculum
and training program? Where should the training occur and who
should be the trainers?
Optional
6. If the ANMs were taught to provide curative services, they would
be able to handle upto 90 per cent of all patient care currently
provided by the doctors. However, AfWs<generally spend about twice
the amount of time per patient as doctors spend. If the doctors
delegated 80 per cent of their illness care time to ANMs, what
per cent of the ANMs time would be left for preventive functions (MCH,
FP, CDC and ENV?) (Assume ANMs would not increase their working
hours). If it was important to keep the present balance of ANM’s
time between the different functions, how many additional ANMs
would be required in order to take over CO per cent of the doctors’
illness care time? How much additional time would these ANI'As then
provide for the other functions? If only 20 per cent of the popu
lation is now covered by ANM services for these functions and
increases in time spent is directly reflected in increases in cover
age, what would the ANM coverage be for MCH, FP and CDC+ENV after
adding the additional ANMs?
7. Select a specific health problem, develop a measurable service
objective related to that problem, and then list the major primary
health care functions that would be required to meet the objective.
Next list several important tasks that are part of each of the
functions you have identified. Finally for each task specify who
would be required to perform it (the individual, their family or
community; trained community health workers; health system workers
with 1-2 years training; workers with over two years training;
public health nurses, physicians, traditional practitioners, etc .)
V
I
f
f
Dynamic Personnel
- R.D.Agarwal
In an all-India Seminar on Personnel Management and Industrial
Relations, held a few years ago and attended by a number of business
executives and. academicians, it emerged thpx ..personnel management is
"objective administration of man in his work with the ultimate goal
of economic advancement.of.the organisation". This obviously is a
misconception. First, it is based on the assumptions of Theory X
which emphasises a managerial strategy based on close supervision,
external control, direction and financial incentive. It also smacks
of the old master-servant relati nships. Second, it assumes that the
employees are a means to an end—t&e end being the economic advancement
of the organisation. It thus denies that employees also have a variety
of needs such as physiological, social and psychological needs which
they seek to fulfil through the organisations. Such an approach is
wholly inadequate to secure the loyalty and commitment of employees.
Instead of integrating the individual with the organisation, it is
likely to lead to his alienation. And lasc, though not the least in
importance., it assumes that organisation have no other goal except
the economic goal. It thus excludes the application of this concept
of personnel management to non-businoss organisations. Moreover, it
also seems to imply that business organisations have only one goal
that is "economic advancement". This is obviously a misconception.
Modern organisations have multiple goals like excellence in research
and development, employee development, increase in market share,
social responsibility., survival, growth, profitability, etc. The
conclusion of the Seminar on the c ■nceiot of personnel management is
thus wholly inadequate and static.
Dynamic personnel management aims at obtaining and maintaining a
capable and effective workforce, motivating the employees individually
and.in groups to contribute their optimum to the fulfilment of organi
sational goals while advancing toward their own individual and group
goals, and integrating them with the organisation in such a manner
that.the employees and their groups feel a sense of involvement and
commitment with.the organisation. As defined.by Thomas G. Spates,
personnel administration is a code of ways of organising and treating
individuals at work so that, they will got' the' greatest possible.,
realisa.cion of their intrinsic abilities, thus att'arning' maximum
efficiency for themselves and their group, and thereby giving to the
ohterprise of which they are a part its competitive advantage and
its optimum results. In yet another definition. Spates says that
sound personnel administration means so organising and treating
people at work that they will effectively utilise their maximum indi
vidual capacities, thereby attaining maximum personnel and group
satisfaction and rendering their maximum service to the enterprise
of which they are part. In terms of these definitions, personnel
management is development and administration of programmes, policies
and procedures which aim at motivating the employees to work
cooperatively and willingly in highly cohesive, harmonious and inter
acting teams, and contribute their optimum to the accomnlishment of
organisational goals while fulfilling their own physiological and
psychological needs. It thus results into an integration of the
indivicli als and groups (informal) with the organisation in such a
manner that they feel themselves a part of the organisation and
give their.loyalty and commitment to the organisation in return for
the recognition and satisfaction of their personal and group goals.
I
¥
: 2 :
if
Objectives of Personnel Management
The objectives of personnel management are:
1. Effective utilisation of human resources in the achievement of
organisational goals.
2. Establishment and maintenance of an adequate organisational
structure and desirable working relati unships among all members
of the organisation.
3. Securing integration of the individual and informal groups with
the organisation, and thereby, their commitment, involvement
and loyalty.
,
i
4. Recognition and satisfaction of individual needs and group goals.
5. Provision of maximum opportunities for individual development
and advancement•
6. Maintenance of high morale of human Otganisation.
7. Continuous strengthening and appreciation of human assets.
Functions of Personnel Management
Personnel management performs a number of functions for the achieve
ment of the above objectives. Broadly speaking, the functions of
personnel management fall in the following areas: (i) organisationaJ
planning end development, (ii) staffing, (iii) training and develop
ment, (iv) wage and salary administration,, (v) motivation, (vi)
(v
employee services (vii) employee record, (viii) labour relations,
relati
and (ix) personnel research. These functions and their sub-functions
have been shown in Figure I.
This is by no means an exhaustive list of personnel functions
and sub—functions or a model thereof. Those are the functions which
are commonly regarded as personnel functi ns in advanced countries.
It also tdces note of the emerging personnel functions in the areas
of organisational planning and development, and motivation. All
these functions, their sub-functions and elements have been spelt
out here in brief.
I. Organisational Planning and Development
Precess of planning and developing an appropriate organisaticnal
structure which will ensure effective work performance 9 fruitful
.interpersonal relati ns and fermati-n of homogeneous, cohesive and
‘ interacting informal groups.
1. Determining Qrganisacicnal Needs. Process
F
‘
of“ determining
organ!—
sational needs in terms of company’s short and long-ternrobjectives, technology of production
production, nature of product, external environmert , public policy, etc.
2. Designing Organisational Structure. Process of planning, developing and designing an organisational structure which will permit
. the achievement of organisational goals.
3. Designing Interpersonal Relationships. Process of designing
interpersonal relationships which will result into healthy and
fruitful interpersonal relati.-ns, and. formation of homogeneous,
cohesive, and effectively interacting informal groups.
■
4
.Figure I
Major Functions And Sub-functions of Personnel Management
Chief Personnel Executive
Organisati onal
Planning and
Development
Staffing
Training .
and
Develop
ment
V/age
and
salary
Admn.
Moti
vation
Employee
services
Employee
Records
Labour
Relat
ions
Personal
Research
Determining
Organisational
Needs
Manpower
planning
Operat
ive
training
.Job eva
luation
Nonf inancial
incent
ives
Safety
Collect
ion of
data
Griev
ance
handl
ing
Surveys
Disci
pline
Evaluation
of person
nel pro
grammes
Planning and
designing
organisational
structure
Designing
interpers?nal
relationships
Recruit
merit
Selection
P lac ema nt
Induction
and
orient
ation
Transfer
Prom j lien
Separation
Executive
develop
ment
Vi/age &
salary
admn..
Incent
ive compens cation
Perfor
mance
appraisal
Counse
lling
Medical
Satisf acticn
of
soc ial
and
psycho
logical
needs
Recreation
Leave,
pension ?
provi
dent
fund &
gratuity
Analysis
of data
Develop
ing inf ormation for
decisions
Imple
menting
labour
laws
Colle
ctive
barga
ining
Data
Collection
Identifi
cation of
need and
areas of
change
Develop
ment of
more app
ropriate
programmes
and
policies
1
: 4 :
2. Staffing. Process of obtaining and maintaining capable and competent
personnel to fill all positions fr’om top management to operative
level.
*
I. Manpower.Planning. Process of analysing company reeds of personnel
now and in future in view of its short and long-term objectives.
a. analyse company manpower requirements in terms of short and
long term goals.
b. prepare an inventory of management and other personnel.
c. calculate and forecast turnover.
d. prepare a schedule of manpower neecjs over a reasonable period
of time.
e. develop job descriptions and job specifications.
2. Recruitment. Process and attracting qualified and competent
personnel.
a. identify existing sources of applicants.
b. develop new sources of applicants
c. attract potential applicants in sufficient numbers to permit
good selection.
3. Select!?n. Process of developing selection policies and procedures,
and evaluating potential employees in terms of j b specifications.
a. develop application blanks.
b<. develop valid and reliable testing techniques
c. develop interviewing.techniques
d. develop employee referral system.
e. develop medical examination policy and procedure.
f. evaluate and select personnel in terms ofjob specifications.
g. make final re'commenda ci .-ns to lino management.
h. send rejection and appointment letters.
4. Placement. Process of placing the employee on the job for which
he is most suitable in terms of job requirements, his qualifi
cations and personality needs.
a. advise line management on placement.
b. conduct follow-up study to determine employee adjustment with
the job.
5. Induction and Orientation. Process of initiating the employee in
the organisation and on the j .b.
a. acquaint the employee with the company personality, philosophy,
objectives,1 policies, career development opportunities, product,
market standing and social' and community standing.
b. familiarise the employee with the peopleywith whom he is to
interact as peers, superiors., and subordinates.
6. Transfer. Process of placing employees where they can be utilised
more effectively consistent’wi th their social and psychological
needs.
■'
a. develop transfer policies and procedures.
b. counselling employees atid lihe management on transfers.
c. evaluate'transfer policies and procedures.
: 5 :
7. Promotion. Process of advancing employees, to. higher positions
keeping in view their capabilities, job requirements and
personality needs.
.
a. develop equitable, fair and consistent promotion policies and
procedures.
b. advise line managers and employees on matters relating to.
promoti on.
c. oversee the implementation of promotion policies and proced
ures.
8. Separation. Process of severing relations with employees in a
congenial manner.
a. conduct exit interviews
b. analyse employee turnover
c. advise line management on causes of turnover.
3. Training and Executive Development. Process of training and developing employees so as to develop their full potential for optimum
efficiency in effective j?b performance.
1. Operative Training. Process of imparting requisite job skills
to operatives.
. a. identify training needs of the company.
.b. develop suitable training programmes.
c. identify operatives who need training and who have the aptitude
and motivation to go through the training programme.
d- help and advise line management in the conduct of training
programmes.
e. evaluate the effectiveness of training programmes.
2. Executive Development . Process of designing suitable executive
development programmes.
a. identify the areas in which executive development is needed.
b. develop programmes of executive development.
c. motivate the executives to develop.
d. design special development programmes for promotables.
e. conduct executive development programmes, enlist the services
of specialists, or/and utilise the institutional executive
development programmes
f. evaluate the effectiveness of executive development programmes.
4. Wage and Salary Administration. Process of compensating employees
adequately, equitably and fairly.
1 . Job Evaluation. Process of determining relative worth of jobs.
a. select suitable job evaluation techniques.
b. Glassify jobs in various categories
c. determine relative value of jobs in various categories.
’ :
6
:
2. Wage^and Salary Programme. Process of developing and operating
a suitable wage and salary programrre .
a. conduct wage and. salary.surveys
b. determine wage and salary rates
c. operate wage- and salary programme
d. evaluate its effectiveness.
3. Incentive Compensation. Process of developing, administering and
reviewing a system of financial incentives in addition to
regular wage pa/ment so as to encourage a higher level of
efficiency.
a. develop an incentive payment system
b. advise line management on its operation
c. review it periodically to evaluate its effectiveness
4. Performance Appraisal. Process of evaluating employee perfor
mance in terms of pre-determined criceria so as to enable
objective administration of the system of rewards and pun: .hment,
and identification of promotables.
a. develop performance appraisal policies, techniques and
procedures.
b. overview consistent use of performance appraisal programme.
c. assist line management in conducting performance appraisal.
d. review performance appraisal reports, consolidate and reporc
on them.
e. evaluate the effectiveness of performance appraisal programme.
5. Motivation. Process of friotivating employees so as to secure their
integration with the organisation and attain the optimum level of
efficiency and effectiveness toward tie achievement of organisational
goals.
1. Non-financial Incentives. Process of motivating employees by
creating conditions so as to permit the satisfaction of their
social and psychological needs.
a. developpolicies and programmes which will permit the employee
to attain the satisfaction of their social and psychological
needs while at work. This may include reorganising the1 sociotechnical system, restructuring organisational relationships,
reorganisation of work, restructuring communication system,
pushing down decision levels, etc.
b. advise and guide the line management in the execution of
these policies and programmes.
c. conduct morale and attitude-surveys.
d. diagnose the health of human organisation.
e. advise line management on the need, areas and ways and means
of improving the morale of human organisation.
6. Employee Services. Process of maintaining a healthy and effective
human organisation.
1 e Safety. Process of ensuring physical safety of employees at work.
a. develop techniques, policies and procedures for safety.
b. advise and guide line management in implementation and
operation of safety programme.
?
$ ?
8. Labour Relations. Process of maintaining healthy and peaceful
union-management relations?
1 . Grievance Handling. Process of redressing grievances
a. design grievance procedure and machinery.
b. evaluate the effectiveness of grievance procedure and machinery.
c. analyse the nature of grievances.
d. identify areas of dissatisfaction and use them as guide in
policy making.
e. advise management on the areas of dissatisfaction.
2. Discipline. Process of developing policies, :rules and procedures
relating to employees1 conduct and behaviour and ensure* their
observance•
a. develop policies, rules and procedures for maintaining
discipline.
b. develop a system of reward and punishment to reward the obser
vance and'punish the violation of discipline.
c. analyse the nature and causes of indiscipline.
d. advise line managemei t.
3. Compliance with Labour Laws. Process of observance and compliance
with labour laws.
a. acquire knowledge of labour laws applicable to the company.
b. acquaint line management with relevant labour laws and help
them in' their compliance.
c. overview compliance.
4. Collective Bargaining. Process of negotiating and entering into
agreement with labour uni^n on wages, working conditions,
employment relationships etc.
a. identify areas of disagreement between management and labour.
b. identify areas of collective bargaining.
c. collect data and information inside and outside the company.
d. negotiate or help'line management in negotiations.
x
e. interpret and administer the agreement.
9. Personal Research. Process of evaluating the effectiveness of
persomel programmespolicies and procedures and developing more
appropriate ones.
1. conduct morale and attitude surveys.
2. Collect data relating to productivity, quality, wages, grievances,
absenteeism, turnover, strikes, accidents and other indices of
operational effectiveness of personnel programmes, policies and
procedures.
3. Report to line management on findings.
4. Advise line management on the need,9 areas and directions of
change.
5. Develop more appr priate personnel programmes, policies and
procedures.
: 7 !
c.
d.
e.
f.
train first line supervisors and workers in safe practices.
overview the observance of safety programme.
investigate accidents and collect statistics.
evaluate the effectiveness of safety programme.
2. Employee Counselling. Process of counselling and helping the
employees in solving their work and non-work problems.
a. motivate employees to seek counsel in the solution of their
work and non-work problems.
b. provide counsel and help.
c. advise line management on the general nature of problems
facing the employees.
3. Medical Services. •Process of providing medical and health
services to employees.
a. conduct periodical medical dheck-ups.
b. advise employees on hygienic and preventive measures.
c. render curative and preventive medical assistance and
facilities•
d. advise line management on employees1 health.
4. Recreation, Canteen and other Welfare Programmes. Process of
providing recreational, canteen, educational and other facilities
so as to make company employment attractive.
a. develop suitable policies, programmes, and facilities.
b. administer the programmes and f acilities..
c. evaluate its effectiveness and diagnose employee needs in
this area.
5. Leave, Provident Fund , Pension and Gratuity Programmes. Process
of providing these facilities so as to reduce turnover'and make
company employment more attractive.
a. develop leave, provident fund, gratuity and pension policies,
programmes, rules and procedures.
b. administer these programmes.
c. evaluate, the effectiveness of these programmes.
7. Employee Record. Process of maintaining up-to-date and complete
employee records.
1. Process of collecting information relating to personnel qualifi
cations, special aptitude, results of employment testing, job
performance, leave, promotions, rewards, punishments etc..
2. Process of analysing employee records for preparing employee
and talent inventory.
3. Process of developing information,needed for decision relating
to employee transfer, promotion, leave, merit, increases etc.
i
r
■i
9 :
As indicated, earlier, these personnel functions are not univer
sal or found in all organisations in all countries. Which of these
functions are performed by staff personnel man’a go men t in a particu
lar organisation, very much depends on its size and location, its
philosophy, its long and short term objectives, nature of industry
and product, market conditions, state of competition, and, above all,
its social, economic, cultural, political and legal environments.
For example, in a small company, most of these personnel functions
may be performed by line management without needing the assistance
of a specialised personnel department. In a non-union company, many
of the labour relations functions like collective bargaining, admi
nistration of labour contract, etc. become superfluous. The nature
"of staffing and training functions in a research or service organi
sation will be different from those in a manufacturing organisation.
In many organisations including a large part of our sugar, jute and
cotton textilesindustries, staff personnel function is not c nsidered vital for the accomplishment- of organisational goals and is con
fined mainly to labour welfare- activities. In many other organic ations like Union Carbide, I.B.M., D.C.M., Fertiliser .Corporation of
India, Tata Iron and Steel Company, etc., it is an integral part of
the organisation and most of the above functions are assigned to
personnel management.
Nature of Personnel Function
Personnel function is integral to the whole organisation. Since
all decisions in an organis’dTiorrowe made by human beings and are
put into operation by human beings, they are affected by all these
decisions one way or the other. Thus all_decisions, whether they
relate to marketing,, financing, production, research and development
or quality control aspect -or organ tsaTio ha 1 ac tivit y, have a human
aspect, ard , therefore, a personnel aspect. Personnel function
is thus all pervasive, transcends all other managerial functions
and is ubiquitous^ In this seh'Se','“every manager-is-unavoidabry~a
personnel manager. ’ The staff personnel executive is there to assist 9
advise, counsel and guide the line executive in the performance of
this delicate and complex personnel function. He is responsible for
aiding and assisting the line management in the ’’preparation, acl pting
and continuing evaluation of a programme of personnel adminisera-ion
expressed in terms of definite company written policies. The personnelui^ a specialised department at the executive level whose function
is to encourage, advise and assist line management.executives to
adopt point of view, develop policies and methods, and apply skills
which will release the productive energies of all supervisors and
employees. The staff-line responsibilities in personnel admini
stration have been delineated as below?
Line management has the responsibility and is held responsible for
good personnel administration... The superviso r is the one who
actually administers the most essential and important phases of com
pany’s personnel relations program... By supervisor we mean every
member of management who assigns work to others, who achieves results
through the support, cooperation and effort of others...
Staff management advises and assists line management in fulfilment
of the latter’s obligation. Staff managementth erefore, is only
responsible for the reliability of the service, advice and assistance
it gives to line management.
: 10 :
Role of Top Managomsnl
Since the personnel, exocutis a^staff officii^and^act^
othgr
advisory capacity, he has n. authority
g
procedures in work
executives who xmpl^nent pvxsvnne^polici.^^ p2‘sonnel
Uci3S,
a—clay situations, t/-.
4n r ^nsultation with line exe—
be only develops P^^nnel P^cicS in c ns X
approved by
cutives. These policies hecome enforc able
y therefore, depends
the top executive
his delegates
His^succe ,^^^
not only on his expertise, ^ompc.
SUppOrt that he gets from
but also, to a sigmiica o
executive should recognise himthe top executive, r ns i, - n -b
-function is an integral
self and emphasise on others
Lj '8V,ry executive is unavoidably
part of all other functions, and wh le ^ry^x.c^
expertise
his own personnel executive, he ®h->u
a
b emphasised here that
of personnel specialists It may, hoover,
of personnel
given ^he support or th.1
t
Qxpertise but
executive will significantly
on
lin2 executives in
^Soi?
us?
»ueh ok
o^Sl”tehnabi/?h?srafHxOoUtiv=‘to isohargo ^.^dvl.ory furct-
i02 ^rdtlS'TAiXarcwt'1 AS ’^oSmSdeS by Hannon, the chief
personnel executive should report di.r^‘^JC,c“paJj58°”lnnt',°
of the organisation. In case ot multi k a
manaqer with functional
nersonnel manager should report to the pl.nt manager
Responsibility to the chief personnel executive.
Conclusion
Personnel management is a dynamic funett on which aims at optimising
the effoctivenoss off humanas on er?
rantUSyi’fa?.-^seehs to w.Xd t^^^/^r^y^ntegratitg^^
the individual V^h the organisati^.^^^^ planning and deveiOpmanagement lie in the ar a-^
,%oiary administration, motivatio,
a«ne»^
sidtrxss:\s HE F ? :?Id-'
of line management in himself as well as m his .xper^i
• ; of Personnel Management in India Agarwal, R.D. (Ed), Dynamics
Tata
A book of readings ., '--- Megraw Hill, Pub.Co.Ltd., Bombay, 1V/3.
.
tment—Approacjj^co jhanpower Planning
(S.K. Warriar)*
amount of time^ effor^ln^monev^to^'f'1’5’35-’ W? dev°te considerable .<
Studies,, location, layout^ JS?
faCti°n like Project
machinery and equipment but very li c Ji ~ t^en tiog6? s ’ hdesign,of Plant»
manpower to operate qunprvica di
ac-ention is bestowed on the
realise that 'of all ecSnomfc rX.r^V^ plants* We seldom.
the longest to develop- vet mosi-Srr> "Ls? hl9h-talented manpower takes
about this’. We do not ge^al y1Utle °r nothi^
power planning (and careef develonmoX! SV
?^ention to manpoint) which is the rJal sourc! of
“ from the individual viewOf all the, input factors goiSg" in -"d - ?nC an~ Po^ential productivity.
Power, is the most important Casi Xi h prOGGSS 0£ Production, man
machinery. material and mnnox,
resource, as other inputs like
While considering problems of i£v4t~XXfeS°UrCeS ?roduced b’/ man.
is given the last or no plac* in mo"' X™
raost valuable resource
that the huge investments in big industri-1
t'atGr when we find
. lri? forth the expected rls^ts In'term^o^efPr^fnX! XX
utilisation of plant and machinery etc
efficiencies of operation,
corrective action. This has proved
n-f scome® to° late for any
sector projects. It is high
ma^y of our bi9 Public
of an industrial enterprises
WQ reallse that in the planning
co„sidara£ion tha! ^n^:rpu’nin”a2srn
“"2t"r
dS :he •»“ CarofS
X ?
important part of
resources planning and act accordinn 1
spend on thls will
„ore than
Manpower Planning Process;
Manpower Planning is the process of <'
requirements and developing action plan todetermining future manpower
j meet them so that the
organisations have the right inumbers
’
kinds
of people in the right
places at the right time doing the
xignu
things.
It includes three
key elements:-
.pre-s®"t- wpxk_f.pTce i-n- ofvanti-
tative^and qualitative'l'terffls*ibin9
specijjl times in^thFfutuie^ec^ibG^in °u: J?npower required at
specifications ^out education'ieveis, sklu^WeriSceslto/'1
fensower Plans: Specific action plans for bridoinn
the forecast and the inventory. The process si 1 the gap between
represented as follows.
' ■ roc'-'jS Can 09 schematically
Existing business
Anticipated business
Manpower requirements
Future work requirements
Manpower requirements
| Existing work forceji Changes to
Work Force
• Transfers i
. Promotions I
. Separations
Future
Profile of
Existing
i Work Force
Future
Manpower
requirements
Specif ic Plans
•» Transfers
. .Training
. Recruit meats
*
111
■ '
•mu*,
Senior professor ? Indian Inst, of Management,
Bangalore-560027.
: 2 :
Manpower Inventory: Assessment of Available Resources
t0 systematic manpower planning is an upto date system
n-f
(i) education, age, experience (including orevious employment
history), position title, salary;
(ii) appraisals of past performance, evaluation of potential for
promotion, career goals, significant achievements.
This information regarding each employee is usually keot in a
personal folder and updated by requiring each employee to ®S^i?
'■r'4
■x''*"*■ s trculars which are entered
basic records * Some companies also have manpower replacement
charts as .a oasis for developing manpower plans, such as. the following:
Key:
,z
--- -------- - --- ------------------------fears to Retirement
Age
1-2 years
Salary
Da te
Appt»/Prom.
2-5 years
i
First Replacement
6-10 years
Second Replacement
More than 10 yrs.
Replacement Re a dines
Ready or less
than 1 year
1-3 years
More than 3 years
I\Lan£p_wer Forecast: ^termination of Future Requirement s
Future requirements are projected on’the basis of:
i^ past manpower growth
sales forecast
iii, expected
7_4 ____ . organisational
___
changes
iv) planned.new products or services
y) productivity changes
v)
f
yi) technological developments
vii research.and. development expenditure
viii. '
investment forecasts and
ix) GNP growth,, after adjusting for requirements, other separations9
transfers and promotions out of che group.
i
*
on gross long term basis or specific short
term basis .at the Corporate, Divisional and unit levels categorywise.
Mathematical models have been developed to relate the variables
indicated above and manpower requirements.
i
1
* i
'
.
.
.
M.anpower plans: Action Steps to Meet Manpower Needs
When the manpower.forecast is matched with the inventory, manpower
needs over a given period will be known. Then an attempt to improve
the utilisation of existing work force will be made first through:
i) organisational changes
inter firm comparisons
changes in job design
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I
NETWORK TECHNIQUES
II. PROBLEM
You are required co prepare Ghana Batura for a visitor who will
be visiting in the following evening. You decide to entertain him
with Ghana Batura and water. The receipe is as follows:
Ingredients: for Batura
1 cup flour, 1 e99, 3 pinch of baking powder, sale to taste,
curd or yoghurt, ghee for frying.
Ingredients for Ghana:
1 lb boiled gram, 2 table spoons curd or Yoghurt, 3 table spoons
ghee, 2 large onions, chilli powder to taste, a large piece of ginger,
garam masala.
Method
Knead all the batura ingredients into a dough the day before.
Set aside in a warm place to rise. The next day, shape into thick
puris and deep-fry in hot ghee. Grind the onions to a fine paste.
Heat ghee in a vessel and brown the onions and chopped ginger in it.
Take off the heat and sprinckle with garam masala, Garnish with
slices of tomato, chopped coriander and green chillies. Serve with
bottles•
f?v^
/? /7/X
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;<
STAFF DEVELOPMENT PROGRAMME : TRAINIE TN NETWORK TECHNIQUES
III. List activities
Assume all the ingredients are .available in your kitchen, and you
are familiar with cooking.
1.
Knead all the batura ingredients into a dough.
2.
Set aside in a warm place.
3.
Shape into thick puris.
4.
Deep fry in hot ghee.
5.
Grind the onions into find paste.
6.
Heat ghee in a vessel.
7.
Brown the onions.
8.
Chopp ginger.
9.
Add chill powder, curd and chana.
10. Cook the chana ingredients.
11. Take off the heat.
12. Slice tomatoes.
13. Sprinkle with garam masala and tomatoes 9 chillies, coriander.
14. Chopp coriander.
1o. Chopp chillies.
16. Serve with batura.
STAFF DEVELOPMENT PROGiWiME : TRAINING IN NETWORK TECHNIQUES
IV. DETERMINE IMMEDIATE PREDECESSOR
Condition A
: You have only yourself and
stove wit a as much
vessels and utensils required.
Condition B
: You have unlimited persons and stoves to complete
your task will all utensils required.^
Activity
Code
Activity Name
Immediate
Under
Condition A
Predecessor
Under
Condition B
1.
Knead into datura
2*
Set aside
1
1
3*
Shape into Puris
2
2
4.
Deep fry
3
3
5.
Grind onions
6.
Heat ghee
5
7.
Brown onions
6
8.
Chop ginger
7
9.
Add chilli, Curd, Ginger,
Chana
8
7,8
10.
Cook chana
9
9
11 .
Take off heat
10
10
12.
Slice tomato
13.
Sprinkle garam masala and
tomato, coriander
11,12,14
11,12,14
14.
Chopp Coriander
12
15.
Chopp chillies
8
16.
Serve
4,13
5,6
4,13
STAFF
DEVELOPMENT PROGRAMME : TRAINING
NETWORK
.TECHNIQUES
---- ------------------------------------------ IN
- ------------------. ..
V. TIME ESTIWYTES.'
.....
Every activity has a time during which it can be completed.
To
arrive at an appropr-iate time, throe time estimates are made,
1. Optimistic time (a) : is the shortest possible time to complete
the activity if all goes well.
It is based on the assumption
that there is only 1% chance of completing the activity in less
than optimistic time.
2. Pessimistic time (b): is the largest time for an activity
under adverse conditions but acts of nature, politics, calamiIt is based on the assumption that there is only 1%
ties.
chance of completing the activity in a time greater than
pessimistic time.
3. Most likely time (m): is the model value of the activity time
distribution.
The time■estimates for an activity can bo calculated by the following
•
f-o-rmuia.
X
l/6(a+4rn+b) & S2 = (l/6(b-a))2
oOo
STAFF DEVELOPMENT PROGRAMME t TRAINING IN N?£T7JORK TECHNIQUES
VI. PREPARE TIME ESTIMATES FOR YOUR PROBLEM
Activity
Code
Activit y
Name
a
b
Minutes
m
tc
(b-a)
1.
Knead into batura
3
15
5
6.3+2.0
2.
Set aside
60
1000
300
376.7+156.7
3.
Shape into Paris
10
15
12
12.2+ .83
4.
Deep fry
10
20
15
15+ 1.7
5.
Grind onions
1
5
3
3+ 0.7
6.
Heat ghee
1/3
2
1/2
0.72+ 0.28
7.
Brown onions
2
6
10
8+ 0.67
8.
Chop ginger
72
5
1
1 .06+0.5
9.
Add chillies etc.
yio
2
1/3
0.57+0.32
10.
Cook chan a
2
8
5
5+1
11 .
Take off heat
/60
1/3
Y20
0.06+0.05
12.
Slice tomatoes
1/2
5
1
1.58+0.75
13.
Sprinkle
1
5
2
2.33+0.67
14.
Chop coriander
1/2
5
1
1.58+0.75
15.
Chop chillies
i/2
5
1
1.58+0.75
2
10
5
5.33+1.33
\
16.
Serve
In practice, deterministic time estimates are made.
may be taken for convenience.
Modal val ues
I
STAFF DEVELOPMENT PROG&WIE
TR/VINING IN NETWORK TECHNIQUES
VIL. PREPARE A BAR CHART
- Net work p-1 arming methods were developed by two different.. -• •
groups independently. The Du pone Co.> developed the critical path
method to plan and control the maintenance of chemical plants, /it
the same' time ‘Us Navy developed the Performance evaluation and Review
techniques for planning and controlling the Polaris missile .project.
The success of the two methods were due to reduction of time for
maintenance from 125 to 78 hours for Du pones and reducing the
development of Polaris missile by 2 years against the original
estimates.
Using the .two conditions mentioned earlier, try to develop a simple
bar chart.
Condition A
1
2
3
4 .
5
6
7
8
9
10
I
I
1
!
I
I
I
I
I
I
I
I
I
I
I
11
12
13
14
I
I
I
I
I
I
I
I
I
I
I
I
I
I
15
16
I
I
I
I
I
I
J
VIII. BAR CHART VS NETWQ5&
Problem
.. Activi ty
Code
Duration
months
Immediate
Predecesser
Name
2
1,2
Prepare plan
1,3
Acquire rights
1 ,2
6
2,3
Finalise application
Arrange seeds
1 ,2
5
2,4
Arrange for credit
1 ,3
9
3,5
4,6
Supply seed
5,6
Supply feed
7
!
(2,4) (1,3) (2,3)
3,5
Bar chart
"1
-
Network.
0.
)4_
>■
11
6
Condition B
i
Activity Time’
—
1
2
3
4
5
6
7
8
i
i
i
i
i
I
i
i
i
i
i
i
i
i
i
i
i
i
i
i
i
i
i
i
I
i
i
/
9
10
11
12
13
14
15
16
Questions for Discussion
1) What are the differences you expect under condition
condition B
a) time
b) resources
c) team activity
d) need for coordination
e) expense
f) predecesser activities
A
and
2) You were asked to entertain the visitor the following evening.
If however at 6 a.m., you get a call asking you to expect the
visitor for breakfast using optimistic resources and time when
can you serve the breakfast with the same menu.
IX
DRAWING THE NETWORK
A, Terminologies in network techniques
(1) Activities
: has a starting point sand an ending point,
takes a measurable unit of time, they start
from or end in events, usually denoted by
arrows, it is the work component required to
accomplish an event, it connects two events,
it can be started only if the event from
which it emanates has been accomplished, is
referred by identification numbers of events
I
it connects.
It is necessary to number events to have unique
number of activities and starting number be
less than ending number of events.
(2) Events
: represents a point in time, like a snap snot,
they do not consume time, denoted by a circle,
is accomplished only when all activities
leading into it are completed, has a number.
(3) Dummy activity: is denoted by a broken.line, It is used to
and to maintain the
maintain unique 1numbering
—
logic.
: is an unbroken chain of activities from the
(4) Path
initiating event to another event.
(5) The legend in a network diagram
: starting event
i
; ending event
j
: early occurance of event i.
E(i)
: late occurance of event i*
L(i)
: early occurance of event j.
E(j)
: late occurance of event j.
L(j)
Ls(i , j ): late start of activity (1,3)
early finish of activity (i,j)
d
: duration
B. Determining the duration
Forward Pass
Backward Pass
Critical path
i
I
4
Time based network
What is the difference in information you have in the three methods
of depicting the activities?
(a) Sequencing
:
(b) ‘Slack time
-(c) Interrelationship between activities
K
C. Updating the network
Question: 1. When can you use a network technique?
2. What is the essential lesson from this technique?
3. If the problem given to you is designed as follow^.
Activity Activity
__Nanie___________ ____
Code
1 ,2
1 ,3
2,3
2,4
3,5
4,6
5,6
Duration
Months
Person Responsible
_
2
7
6
5
9
11
6
Mr.A (Coordinator)
Prepare Plan
Acquire rights
Finalise application
Arrange seeds
Arrange for credit
Supply seed
Supply feed
Mr .B
Mr .A
Mr.C
Mr .D
Mr.C
Mr .E
Using the time based network discuss,
and to what extent*
i) Who has slack time to delay completion,
ii) Who will monitor the progress what information he has to enable
completion of the project.
iii) Who would be responsible if activity 5,6 is delayed by two
months•
iv) What would be the implications of this delay to the project
and personnel concerned.
‘ i if the delay is in activity
v) What would be the implication
project and personnel, How can
1 ,2 by two months to the
■_
you rectify the same?
0O0
C‘
P-
Module F: Financial Management - DCHMiMAD; VII Batch 1988-89
Module Objectives
1< Appraise the financial position of an agency by scrutinising its books
and financial statements.
2. Prepare an appropriate budget fo r a pr ogr amme.
3. Use. technique of management to
sation of funds. ” -- -------- ” enSUXe efficient ^nd effective utili-
4. Follow legal aspects in finance.
Content
Book keeping, Budget, Cost
Cost ben
benefit analysis, 1Fund flow statement,
Financial analysis and control
----- , Legal aspects in finance.
Lesson Plan
1 . Introduction & Pretest
2. Budget
: DrtThomas P,Benjamin : 1 period
: Mr1Immanuel
: Followed aby
application in
workshop
3i Book keeping
: Mr.Mathew
: 3 periods
4. Cost Benefit Analysis
i Mr.Rajamanickam
: 2 periods
5. Fund flow statement
: Mr.Rajamanickam
: 1 period
6. Financia-1 Analysis & Control : Mr.Rajamanickam
: 1 period
7. Legal aspects in finance
J Mr.Immanuel
: 2 pe ri od s
8. Buffer period
:
: 1 period
9. Evaluation
: Dr.Thomas P,Benjamin : 1 period
Evaluation
Post test, exercises, attendance, assignments
References
R.Shankaran & Ivo Rodrigues: A Handbook to the Management cf Volunt
ary organisations, Alpha Publishers, Madras, 1983.
2. King Edwards Hospital Fund for Health, Accounting for Health, 1973.
3‘
K’dZk^0Cu’ Health Care Finaa cing in developing countries
American Public Health Association International Health Programs,
4. Rosemary McMohan Elizabeth Bartoon & Maurice Plot,
FLuu, vn oernq
On Care^
being incharge,
Geneva6
LeVel Mana9ement in Primary Health
~
, WHO,
I you.
5. VHAI, An Accounting Guide for Hospitals & Nursing Homes, 1978.
i
RUHS A DEPARTMENT OF C.M.C & H: VELLORE.
BOHM 1988-’8 9
: -MAD - MODULE - E
MATERIALS MANAGEMENT
Qbj ectives:
1 .
Determine and procure the material
from a
programme.
resources required
2.
Administer'' ‘
procedures fOr efficient management of
expendable and non—expendable equipment.
5.
Use techniques of management to ensure efficient
and
effective utilisation of material resources.
Lesson Plan;
1 .
Introduction and Pretest
2.
Reading and Discussion
(Purchase)
4.
5.
1 period
2 periods
Reading and Discussion (Stores)
2 periods
Observation of stores and
purchase functions at RUHSA
Trip to CMC
3 periods
2 periods
( i) Durairaj
(11)Venkatesan
6.
Library time to complete
Exercises
3 periods
7.
QuaA^rtative technique in
management s
2 periods
8.
Buffer period
1 period
9.
Review and evaluation
1 period.
Reference:
Gupta, D.R., 7
Purchasing and store keeping,
Hindustan Publicati
ion, New Delhi, 1982.
Tata Megrow,
Pooler, Victor M., The purchasing Man. and his
1 ara perevala Publication, Bombay, 1977.
job ,
First r
course
for Health Administration <on Management of
Health Institutions,, Indian Society of Health
, Adm ini st rat i on,
McMohan, Rosemary, Sartin,
1980.
Elizabeth and Piol, Maurice,
on I
mcharge - A guide for Middle level
Management in Bombay
Health‘ Care,
> WHO, Geneva, 1980.
A/ X
/
MATERIALS ?WAG-EMENT
Introduction to Materials Management:
The function of materials management includes controlling and
the flow of material in an Organisation, in relation to
re gulating
i
- - ■'like
prices,
availability, quality,
changes in variables
demand,
Materials Management’ essentially deals with
delivery schedule etc.
determining how much, when, from whom and how to order material.
Material Management encompasses all functions having to do
with materials, including production scheduling, -materials control,
purchasing, traffic and material'-’
handling on the s^ame level as
a line manager.
Several allied functions such as traffic,
receiving -and inspections may or.may not be included within the
materials management jurisdiction. In shot , the purchase and
inventories are under one Manager and is concerned with all
activities necessary to provide an uninterrupted. flow of material,
parts and services used in line.
The. advantages of an expanded mat ...rials organization is:
1. Reduced lead time
2 . Greater consistency in quality
3.
4.
5.
6•
r.-
7.
8.
9.
10.
11.
12.
Improved continuity of supply
Improved vendor relations
Unbiased make or(buy decisions
Improved inventory turnover
Better availability of materials
Reduced obsolesence
Reduced materials handling, Packaging and storage uses
Reduced transportation costs
Reduced’duplication of efforts
Increased opportunity for integrated data processing.
The advantages of the’materials management organization
encompassing the three main functions — material planning, Inventory
and purchase are questioned on the grounds of the purchase function
tending to be subordinate; in the overall function.
Material Selection:
Determining correct specification pf materials and components.
Operating cost:
It should endeavour to keep the operating costs low without
making any concession in quality.
Consistent quality:
The materials department is responsible for the quality of
materials (aS per specifications laid) procured and supplied.
Continuity in supply:
Materials should be available when required to maintain the
continuity of activities; emergency purchases and frequent stock
outs should be kept to a minimum as this increases the cost of
production.
Low cost of Possession:
Correct handling, proper st ring, receiving in optimum
batch sizes, deciding an proper mode of transport etc., are some
of the factors that keeps the cost of possession low.
z
2
2
High Inventory turnover:
t is defined as Utilization decided, by average Inventory
Holdings•
7Lower inventary holdings in relation to utilization ties
down lower capital,
- . - • •’’t improve^ the efficiency of capital used
and makes an available higher working capital.
Vender - Vendee jlela
Ions;
Organisations generally depend on outside sources for
heir material supplies.
If the materials are cordial it may
bring extra service, cost recu ution, rushing deliveries,
supplies on credit etc., from the suppliers/Vendors.
If
properly developed, good Vendor-Vendee relations can be a gain
to either side.
St andardisation;
Use.- of. standard components generally keep its cost down.
The materials management personnel'can 1
make significant contribut
by receiving^stocks to single unit non-standard item
—variety
medication, imports substitution, promoting use
of
standard
components etc.
Scientific systems .gjicj. ivec ords ;
Good records help in planning,
-z analysis, forecasts
V-PdoZlC + ntr01,' pric
? negotiations, make qt buy decisions,
price
co-ordinating
S
co
"ordlnatlng complaints and a lot of otner
purposes.
These contribute significantly to an Organisations
survival, growth and outside image.
Judging from the point of c apital investments in
developing
econo; y, an investment of about 25 percent of the totala is
roughly incurred on inventories.
It is
generally the second most
important asset (the first being plant
■
equipment
and buildings)
in most organ-isations.
Therefore,
Therefore, its
its ’control
control is
is a vital phase
ma erials management. Proper
Proper management
management can do a lot tn
improve the effecieney with
which
this
with which this I apital is used
THE PURCHASE FUNCTION.
Purchasing:
Purchasing has been defined by Westing and Fine
as a
business activity directed
to securing the materials ? supplies
. and equipment required in the operation of an Organisation1.
Im£ortance of Purchasing:
lor efficient management of finance
i+ 5« n
r
good quality material
bought at the least possible^prices.
2. .. Material must' he supplied to the Institution
on a'continuous
asis.
Activities should not be heldup due to non
- avail abill ty ■
lock? uU±u £ ths samrtime’
must be
■ g
j 1s t■ o- ^oixi
regular
suppiVSA^X
cLt^Tt^SthT1 fUnCti°n Of Purchasing, the institution comes in
their activities.
equipments usZ^rthem^e " ’^InT
tiVitieS ’ thei- Policies ,
Ibis
information
invaluable in framing plans’and "hSS^rac
0^!:::^^']8
•to thV^nstSufib^-^h0116^®37
be able
materials in use.
i'^utTon
act^^ly Prove to be costlier
I he. purchasing departmeA
department mus^
on new substitutes for the
. .3..
.
Duties and responsibilities of Purchasing Officer;
1.
Issuing Purchasing orders
2.
Interviewing Salesmen
;■
,
Negotiation with Vendors
Selecting Vendors
4.
5.
6.
. Making adjustments with Vendors
7<
Maintaining records of vendors
8.
Developing new sources of supply
9,
Follow-up orders.
1 0.
Maint alhing a C at alogue library
11 .
Disposing of scrap and surplus materials
12.
Checking and approving invoices
1 3.
Scheduling purchases and deliveries
14.
Determining buying time
15.
Checking requisitions
16.
Determining how much to buy
17.
Keeping in full touch with the markets and being acquaited
closely with current
quotations and sources of supply.
18.
Making forcasts of the probable future requirements of the
several commodities sufficiently in advance, in order to
take the fullest advantage of the low markets due to seasonal
f luctuat ions i
19.
Insisting on due fullfilment^^of deliveries by suppliers as
indicated in the orders, and thus ensure a steady supply
20a
Maintaining a complete and classified record of the minimum
and maximum stocks required; quotations from suppliers,
supplies ordered,
price charged etc.
Analysing bids and prices
•
Qualities of an efficient purchase officer;
1 .
He must have considerable experience in buying and must be
fully conversant with the purchasing technique.
2.
He must possess high technical ability to discriminate judici
ously between the commodities offered by different suppliers
so as to decide upon the most suitable firm.
5.
He should have organising ability
4.
He must know how to negotiate.
5.
He must possess sound judgement, and all his activities
should have the impress of method and precision.
6.
He must be reliable and dependable
7.
He must possess sound knowledge of finance and efficient
business methods.
8a
He should have good practical knowledge of industry.
9.
He should be honest.
.. 4 . .
4
Essentials of successful purchasing:
1 •
To determine what to purchase.; . In order to procure correct
material and reduce correspondence and replacement of mateerial,
the material which has been indented only by a right and .
competent authority, giving full spec ifications: and details of it,
should be purchased.
2.
To determine from where to purchase:
The order should be placed
only to that supplier who has been adjuged ‘ • go.od .in dealings and
supplies, and with whom all conditions have been settled.
3•
To determine when to purchase: The purchase.of material
should be made sufficiently before hand so-that work does not
suffer due to shortage of material.. -Mate rials should be Purchased
when market rates are low.
7
4.
To determine how much to purchase: The quantity.of material
purchased should be according to the amount required by the
indentor.
J L.
5.
To determine at what rate, to purchase:
If should be *
considered . while purchasing^ that orders has to be..placed with
the lowest but favourable bidder, and also where the conditions
of payment and discount or commission are bestv
G
. ,
6.
To maintain complete purchase rec ords effecientlyG■
«•
How to carryout effective purchasing':
The. following steps are useful for ' carrying out ••■ef-fect ive
purchasing:
1 •
Initiation of request in the form of a purchase., requisition
from the department requiring the goods.
2.
Ascertainment of an accurate statement' of character and
amount of material needed, preferably based upon specifications.
3.
>5election and development of desirable and dependable sources
of supply.
.
4
Negotiations with the sources.
5.
6.
Analysis of the proposals.
Selection of the vendors
7.
Placing of the order
8.
Follow-up of the order
9.
Routing the•order
10.
Receiving the goods
11 .
Chocking invoices and goods
. ..
12.
Keep materials in a place whore they will^be safe a^d readily
ac cess ible.
Sources of supply;
After determining the quality and quantity of goods, to be
bought, the sources of supply are to be tapped.
For this the
following are very helpful:
’
1 .
•'Trade directives
2.
Telephone directaries
3.
Purchasing periodicals
4.
-Newspaper and commerce magazines
Catalogues, blueprints and other literal uro of advertising
nature.
.. 5
5
6.
Suppliers index files
7.
display of film data
8.
Exhibition and trade shows
9.
Interviews with salesmen
10.
Market surveys
11 .
Professional organisation
12.
Quotations
13.
Experteno e
While considering a suitable source of supply, the
following factors should be given due c onsideration;
1 .
Whether to purchase from a single supplier or a multiple
of them at the same time.
2.
Whether to purchase from the local sources or from some
distant place.
3.
Whether to purchase directly from the manufacturer or
through a w lolesaler.
The selection <of~ right
' _* ’ supplier is of paramenant importance
because if the supplier turns outJ to be bad, the competence,
organising ability of the buyer and all other qualities will go
waste 4
Advantages of a single source;
By purchasing all requirements of a particular item from a
single source, buyers can
c an. gain the following advantages.
1.
..he buyers make maximum use of their buying po.,er.
They conce
po .(er.
ntrate
all requirement for a certain item on a single supplier
and thereby get the largest possible quantity discount.
2.
There is less administrative work for the buyers
entire
organisation, since it is necessary to issue purchase orders,
receiving reports, inspection reports, checks and
on to onlv
one supplier per item.
3.
r
' ■5erS o:ftGn
?~£pl:
special price concessions if they can
make 10% of the requirements of a given item, since they can set
up
their production in the most economic manner and invest in more
efficient tooling.
4.
Less investment in special, tooling is usually needed.
One
supplier generally needs only one set of tools, while two suppliers
will need a set each.
5.
Suppliers have more incentive to aid in methods improvement.
item.,, he is more likely
company's product,
item under a long-term
likely to devote part ox
If a supplier is the sole source for an
to rega.
himself as
as a partner in the
particularly if he is manufacturing; the
contract.
As a result, he will be •]more
his
R & B efforts to improvements.
Advantages of multip1e sources;
Despite the above adv ant ages,- many companies do. their
utmost to avoid relying on a single source for all but' the most
unimportant items.
They try to have at cost two- suppliers for
each item .and sometimes they
„ have
’
j three or four.
of multiple sources are:
The advantages
1 •
Jith several sources, there is less risk of interruption
of supply due to quality problems, strikes, fines, and so on.
If one supplier fails, the other supplier(s) can take up the slack.
.. 6 ..
-
“
2.
With two or more
suppliers for one item, a healthy
competitive spirit ccan develop in which each vies to improve
methoc’s and reduce costs
m order to get greater share of the
business.
with a single ,
source,
the supplier may. become so well
versed in making the item
that he gets a virtual monopoly of its
manufacture and sometimes
date can meet hisprices. , no competition brought in at a later
Many items require nn
or little ■tooling
’
on one used in
such large quant -it -i
’
that
duplicate tooling is necessary
In these cases f there is
any way.
—5 no cost premium for tooling a second
s ourco.
4.
The unit price of the item is no higher with
- more than one
source that it would be if
all requirements we^e <concentrated
on a single source,
5.
The buyer has found
^a new
new supplier with low prices whom he
would like to introduce i^o the item but with whom
its is not yet
familiar enough to trust with 100% of
"the business.
l23Zi±ia^_Tendggs . and Quot at ions ;
nnv^3^y;fenders.are
ited when -time
involved is large.
permits and the money
The following are the different methods of obtaining tenders:
1 . Open tender (i.e. by advertisement)
2’ Jirms^ tender
direct Citation to limited number
of
'
i.-
’
'
Single tender (by invitation to one
firm .only)
4.. Oral tender
Open g ?nder:
adverti s e d t e nde r.
many and the' value is large.
of tenders
of orders.
When lr
- quantities are required it majr ..even be
desirable to place
order for a part quarttity on
a proven supplier
to ensure continuity of supply till supplies through
l advertised
t ende rs are avail ab 1 e .
-?» — ?ve.f„
vu,,,, jjllowest. ’fc<7na®*‘ is sener^ly accepted but
not in all cases.,
tendon f erS axe lnvit.e^
public advertisement the
issue of
t^nd^r. forms need not bo ros“'_r,i
-p-;
the liqf nf
i
"
tcd- to firms tfhose names may b.-- on
shLlI
.approved contractors.- Firms not on the list
-hrthor the firn, Is oapnble of .LoujS, the -oik ,e e
J portlSSSa
V
=»tiSfaetoky, the ortleir ol
te^eetie^tot-ny, the h^e o" i
list Of approved contractors.
included, m the
Limitqd Tender:
Rs
nthaJaiuo of th- tender is moderate,
n.. .20,000 limited tender system should be used say, not exceeding
invited only from those firms which arc on the‘ .Here tenders are
approved list of
suppliers.
'
'
•. 7
.
- 7 This system entails the following advantages:
1. Being regular suppliers they submit realistic quotations
2,.
They are normally fully conversant with the material etc.
3- The prospects of supplies materialising axe better
4. Chances of progressive reduction in price.
Single Tender:
..
——
Such a tender is issued only in those cases where an item is
of a properietary nature or where a repetitive order is to be
issued within a short period.
Oral Tender;
In case the supplies are of minor nature and are urgently
ne e d.e d, a man is deputed to purchase the required items from the
open market•
He finds out the prices from two or three vendors
and makes the purchases from the vendor which quotes the minimum
price, and whose supplies conform to the necessary specifications.
Receipts and opening of Tenders;
The following procedure should be adopted for receipt and
opening of tenders.
1. A register of tenders received shall be maintained in
which all tenders received by mail or otherwise shall be entered
immediately.
2. At the time of opening the tenders the Purchase Officer
and' representative of the Chief Accounts Officer will initial this
register.
25. Only sealed tenders will be accepted (except in emergency)
aiid should not be received by handy but in a box' provided for tho
purpose.
4. The Purchase Officer shall on each day collect the tenders
due on that day and ?n the presence of a representative of accounts
department open the tenders.
Every page of the tender form must be
initialled by the officer and numbered and the last marked ’last’ .
5. The tenders or their representatives who wish to be
present at the time of opening i,he tenders will be permitted to do
so.
If desired by the tenders or their representatives, the prices
quoted may be read out.
6. Once a tender or quotation has been received, no
alteration or. modification is 'allowed.
7. Delayed/late tender received after opening of- tenders
shall not normally be admitted.
The cases where there is conclusive
evidence to show that tenders were actually sent/posted in time,
may or may not be accepted.
Scrutiny of Tenders/Quot at ions and placing of .Purchase Order:
Normally the following procedure is adopted for- scrutiny of
tenders and placing of purchase order:
A comparative statement of tender received will be prepared,
1 ,
under instruction to point out relevant data. Normally the lowest
quotation should be accepted, provided it conforms strictly to
the specifications.
2.
When a quotation other than the lowest is acceptable, the
purchase department in consultation with Chief Purchase. Officer or
identc
will prepare r. detailed Hote giving reasons for choice.
. . 8
-8J.
V
/.haS bGen Finalised, concurrence of the
Chief Accounts Officer/Managing
- . J Director is taken.
Tne Chief Accounts Officer will indicate his
c one urrence
and pass on the file to_ the Assistant Purchase
Officer,
who will
be competent to issue the purchase order if the
order
is
for the
lowest quotation and amount involved is n~L
not
more
than
Rs.
1,000
per order,
orders,above Rs.1,000 but —
not- more than Rs.25,000
the purchase officer
-• will be competent to
the basis of other than lowest tenders. >: sanction purchases on
For orders above Rs.25,000
but not more than Rs.75,000 the Chief Purchase
Officer will
be
competent to issue the purchase order if the order is.for
the
lowest quotation <or otherwise.
’__
Por purchases involving over .
Rs.75,000 Manager/pirector’s
concurrence, is necessary.
5•
In cases the orders
are not for lowest quotations and the
value of quotation is up~to Rs.25,000 the Purchase Officer will
issue orders subject to financial c<
cncurrence o£ the Chief
Accounts Officer.
In case where the order is
and it is proposed to place the order with a ■ ‘ above Rs.25,000
party other than
the lowest tenders, the Chief Purchase Officer
for
good and sufficient reason, to sanction purchaseis upcompetent,
to the value
of Rs.75,000 subject to financial co
of Chief Accounts
Officer.
The reason provided must concurrence
be
be recorded.
6.
aSoopt°,,“i°itaij0”o,O b' undertaken
time is more than 5^
1 ooo/
T
receivt?d in
5^ or Rs 71,000/tenderer vil1 than
kZ
In such cases the lowest
-e given
given a chance to reconsider his tender and
accept the rates of the tender received late.
not acceptable fresh tenders should be called. If these rates are
In exceptional
c as e s ■ .?.aere delay in calling fresh tenders
—
- —will cause loss or
inconvenience and the saving is substantial the
late tender
may be considered with
- the
He sanction of the Chief
Purchase Officer.
Purchase Order;
A purchase order is an ’ offer5
by the purchaser to enter
into a contract iwith
* *' the
•~
vendor for the supply of goods.
A
contract is established
----------- L when the vendor ac c ep t s t he offer.
The
purchase order serves as the vendor*s
authority
to
change
for
the goods supplied and the buye rs commitment
to pay for them*
The purchase order should cover
definitely and precisely the
essential elements of purchase to be
made,
in a manner which will
render future misunderstanding impossible
--■:
and
minimise the
necessity of correspondence,
Before placing ;an- order, the purchaser
must have complete details of
the items required
— and the terms and
conditions of supply.
desoription/deliveb
> ordered
9
terms, prich
m^c^l^L^^
® lnst^ct
>• billing and
• contrU and in:^cet^^Uons ,
of
Follow-up of the purchase order is of
beanie.
the materials are received in time.
j/b.
-fm
g
a_Lisea only if
l-Ji
STORES PROCEDURE
as ournhnX7?aniSatiOn7r institution which is mulcipartite such
as our hospital, consumable materials and equipment commonly used by
foh + hPr>d-n9hbmenfc? ai’f frequently required and hence therehs a n?«d
stored Ari ri? ?eAraAy Purchased on the basis of future demand,
lent
ArAUted Pe^odxcaily. Articles thus purchased and
kept for distribution make up the Stores Inventory.
Inventory is defined as idle resource provided that such a ••
resource has economic value, Thus inventory is made Up of materials
of value for which finance is needed for purchase. Effective control
has to be exercised in purchase?? storage and distribution.
The chief objective of materials management
management is
is to'make
to 'make materials
materials
available at minimum cost.
... In otherwords to maximise availability^
and to minimise cost. As these two are opposing factors,.-, che work
of bringing them together involves
--- > appropriate methods and procedures.
With these constraints the materials manager has to procure the
•
right material in
ln the right quantity
^oantity at the right time,
time. The systems
followed in
inventory
control
;are direcced towards achieving this
m
threefold object.
For effective control , materials are analysed into various categories or groups.
1. Value Analysis
Materials are classified as A, B and C on che basis of their
annual consumption value (ACV). These with high ACV are classified
as A and C concists of materials with the lowest ACV. An inexpensive
material such as a roll of bandage could be classified as A as a
hospital consumes several thousand rolls of bandage in a year for
which the cost amounts to much. VWhereas
”
‘
in
a home or in a factory it
will be an icem of low consumptioni as
-- it
•* will be used only in
emergencies such as first aid in cases of injury due to accidents.
This value analysis or ABC analysis (as i_
it is popularly known) is
the basis on which quantity purchased at a time JLs determined^
----- ----TA!
class items from the imajor^perccncage
J
of the inventory valuewise, but
-i
xi
•
They
are numerically much less
than the rest. of- the inventory.
mne+T+uJ-O
nr
1
w
-1
r\
^RO/
4.
U
~
.
n
•..
.
,
i'/i
Jconstitute only 10-j5% of the total inventory numerically but account
for about 70—80% of the value. We
’r Can diagramatically
’*
.
represent ABC
analysis as given below with tvvo• triangles
i
one with the apex pointing
upwards of the other downwards or as
-- two sides of
a coin with concent
ric circles.
Numerical
Value
10 7^
A
> F5/<
------ ~7^yc
B 7~~.
>- \^7.
Tr~~\/
c
—-> 7^7.
A
L
P
7^7.
/
z
/
I
\
t
( < A_ I
7
1
'o/.
)
: 2 s
As a small number of items iaccounp for a high
‘
value rigid control
can be more easily exercised on A- class items. These dx
aretf dalso mostly
fast moving items and therefore orders are placed for these
-- ? on a
monthly delxyery basis so that wo do not hold a high inventory which
wi.tl resulc in blocking of a huge capital.
Less control needs to be exercised on B class and the least
control on C class items.
Economic Ordering Quantity .(EOq) and Re-order Level (ROL)
A common formula for EPq is givenbelow:
‘
EOQ
=
AC
UI
Whef’e -A
Annual consumption .quantity
C
Cost of ordering
U = Unitcost
I
Inventory carrying- cost
Examples;
Annual consumption of 25 watt bulbs
Cost of ordering (Average cost)
Unit cost
Inventory carrying cost
300
Rs.25/Rs.5/20%
i:
/2 x 800 x 25
EOQ
5x2
= 740000
=
200’
This would mean tha.>; we order 200- 25 watt- bulbs ac a tirhe\ oronce in three months.
; ,;.p. J. ; r ; -L
This formula is- not however strictly followed. Some would like
of
0006 in S1X mon’ch:s. in which case-the EOQ will be 400 instead
For items which have limited shelf life and are consumed in small
quantities (slow moving) the EOQ will be naturally less.
When to Order
The Bin Card of Kardex system as replaced the stock ledger in
SCh°er::Llpt"uLre SrPalCaneeaMriy=aU?)!aCUt,nS
'Tt9rlal
Re-order Lpvel (ROL)
This is the level at which a fresh order is placed for the
material.
purchase request
request
•
,
., The time taken from the
-- date on which aa purchase
'
is made upto the time the material arrives is called ’Lead' Time
(LT).
1 is is what determines the ROL. Lead Time is an average figure
calculated on six occurances and is expressed in weeks.
Example: Date of demand
2-1-88
Dace of arrival of material 27-2-88
Lead Time
g weeks
4
? 3 :
The quantity of material
. . which
, wil1 be required for consumption
during the Lead Time is calculated
and this is called Lead Time Demand
or LTD.
Roughly
ROL = LTD + SS
SS
stands for Safety Stock
SS
LTD (Approx.)
2
Calculation of RQL
Average quantity of Bed pans consumed per week
Average Lead Time = 7 weeks
ROL = LTD + SS
= 14 + 7 = 21
When the level of stock comes clown to 21
2
a purchase request is made.
What to Purchase
:. ...
, purchasing the right material we need to have a complete
description of the macerial with detailed specification.
For instance if a Foley’s catheter is co be ordered we have to say
Foleys Catheter
FR = 10 or any othersize required
size
Bulb size
3 cc or whatever the capacity
•
- Two wa.y/Three way
Material Rubber/Latex siliconised brand preferred
Bolt & Nut
Material ' '
Length of bolt
Diameter
Length of thread
Shape of Head
Mild Steel/GI/Brass
50. mm ' ' .
6 mm
8 mm/16 mm Half Thread/Full Thread
Round/Square/Hexagonal
•
Level of Inventory
All possible efforts' are made to,keep^the lowest possible inventory without the risk of non-availabilitpof"stock?
* The cost of stockout (or -.....
- - is \
non-availability
of. stock)
an
unquantifiable
factor especially in a hospital particularly in a life saving item.
In order to facilitate selective control two other analyses of
material are made.
One is the analysis based on criticality viz. the VED analysis:
Vital
Essential
and Desirable
The second is based on availability and is called SDE.
Scarce
Difficult to obtain
Easily available
s 4 ;
We cap..-.therefore analyse materials in .three ways i.e. based on
value■9 criticality and.availability.
Criticality
Vai xe
Availability
V -----------A..^
• . E . .
D.
S
C
D r—---- -^-E
Combining the three we can determine in which of the categorieswe should hold a high inventory and in which a low inventory.
High
CVS
Low
ADE
Explanation
C Class items are of low Annual Consumption Value (ACV) and there
fore can be stocked up. Vital items have to be available in plenty
as they: are highly sensitive and critical. I sems which are scarealso
need to be stocked in good quantity for obvious reasons.
•
'
We need to hold a; low inventory in A class as their ACV is high.
We do not need to hold much s.ock in Desirable and Easily available
items.
It has to be noted tha> the three groups are not mutually exclus
ive. An item which belongs to C Class could be vital as these belongirg
to A or B class. An item which is scarce may be- in the A class in
which we will need to hold a big stock.
Where the inventory consists of a number of items these methods
help to exercise a selective control as otherwise too many items will
have to be watched which is time consuming. Therefore ABC, VED and SDE
analyses are very useful tools in the hand of a materials manager.
Distribution of Stores
From various consumer departments indents for materials are
received in stores periodically i.e. once a week/fortnight month. This
gives the storekeeper time to spend on other activities such as check
ing the stock, raising indents on purchase, receiving materials ordert
making entries in bin cards, filing, cleaning the premises arranging
macerials in bins and so on.
9
Materials can be broadly classified as consumable and’ non-consumable. A candle or a match box is considered as consumable whereas
materials like brass caps, blades, buckets, pahs, torch cells, electric
motors or any kind of equipment-, furniture etc. are classified as non
consumable. Issue of consumable stores is on an average consumption,
basis, whereas issue of rion-consumable material is on the basis of
replacement or on a certificate of condemnation. The unserviceable
material or in certain cases the containers (eg. sutures) are to be
returned for obtaining replacement. In this manner' control is exercised
on undue or excessive consumption.
An indent from a department to. stores, has to be duly signed by
the indentor and authorised by the head of the department. It is also
essential to give full and proper description in order to get the
right material.
i 5 :
Arranging and Issue of.materials
First in First Out (FIFO) is usually the principle followed by a
st°rekeeper. This is absolutely necessary in the case of materials
which have ximiced sh&lf life and specific dace of expiry marked on
the package*
- .
Disposal
This leads to disposal ofunusable spoint or unserviceable material.
Disposal is done.periodically. Certain items are saleable as- they are
.made ot plastic or more valuable material like brass (eg. brass taps,
taps
valves, stop-cocks). These are kept separately and sold.
Inventory Control Techniques
The main objective of scores is to make the reguired material
■ available at the ..right time in right quantity. Techniques ofinventorv
. control .are used in order to achieve this objective. Records need to '
be., kept upco date .for this purpose of which the Bin card is vital.
..;.This card is - kept., either in the bin where the material is scored or
neatly arranged groupwise/categorywise in the Kardex cabinet. The bin
card should clearly show the detailed and exacc description of the
material, the material code No., che economic ordering quantity (EOq)
and re-order level (ROL). The EPQ and ROL are quahtilies/levels pre
determined, by calculation with formulae and the purchase/issue unit.
It should also have columns to show the dates of transactions viz.
receipts and issues, and the balance of stock at any.time. As soon as
the re—order level is reached this Storekeeper has to send a purchase
request for the material. The quantity to be ordered is the economic
order quantity. If the annual consumption quantity is also indicated
in the bin card it will help in determining the EOQ.
The EOQ and ROL have to be reviewed periodically and revised if
f .'necessary. If the rate of consumption increases or decreases, the
EOQ has to be revised up-ward or downward as applicable. If ..the lead
time increases the ROL may have to be increased. A low inventory is
achieved by regulat ng the EOQ and ROL. A high ROL will involve high
inventory and therefore should be avoided in A & B class items, unless
they are vital or scarce and seasonal items, in which case material
availability has to be ensured even at a higher cost.
The scorekeeper should , also c-atoh tlhe movement of' material to see
if -the rate of consumption shows a steadyr or steep, fall,, leading to
obsolescence. If a certain material is being gradually substituted by
a better alternative , raising demand or purchase request for the former
should be stopped or regulated. If this is not done, he will eventually
hold stocks which will become obsolete. Obsolete stock is dead stock
and adds to liability.
Receipt
Heceipu and issue of the stock have
nave to be recorded promptly.
promptly.-■ All
s cocks received should be checked for quantity and quality and arranged
in the hins/shelves with minimal loss of time, Risk of pilferage is
higher in a disarranged stores.
Arrangement
profit, motiveFirst
moti.ve
Where there is no .profif.
in First Out\ (FIFO) princi
ple is. followed. Firs: in Last Out (FILO) and Last In First Out (LIFO)
are principles employed for consideracion of profit, Arrangement or
stocks depends on which of the above principles is followed.. When the
shelf life of an item is limited (whether it is marked on the package
or not) FIFO is to be followed. When it is no c marked on the packing
: 6 :
it is advisable to.keep the batches separasely and clear the old ssock
first. Deterioration is inevitable in certain items especially those
made of rubber, which have to be ordered in limited quantifies. A
lo’w stock of volatile items is necessary in order t avoid loss due
to.rapid evaporation. Drugs which have expiry dates will have to be
utilised before the expiry date and therefore should be ordered care
fully, inspected when received and issued promptly for use.
Certain controls are to be exercised while issuing materials'.
Materials can be broadly classified .as consumable and non-consumable.
1 he user departments are responsible for effective control of consumpt_
ion.of materials, especially consumables. The Storekeeper receives
periodic indents and therefore has to watch out for any abnormal demand
for a consumable item. It is easier for the storekeeper When materials
are issued on replacement'basis by which the old broken or unservice
able material or the empty container- is produced has pibof of consumpt
ion. and need for replacemenx. It is.necessary to control consumption
in items such as brass,-water taps, valves, motors and minor equipment.
Suture materials, noodles, syringes are also issued only on replacement
basis for regulating consumption.
Disposal-of Scrap
Disposal of scrap has to be done periodically. Non-saleable
scrap which can be burned should be cleared then and there and sent
tb the incinerator. The saleable scrap has to, be kept separately
and’disposed of periodically. It ,is better to keep an account of the
items, which can be sold in order to eliminate pilferage of saleable'
.scrap,.
x
Principles of Storing
The-following principles of storing go a long way in exercising effici
ent control of stores^
1. All the materials must be identified and labelled, This helps
in establishing their nature or identity.
2. Name, .class and reference number should be borne by each item of
material to be stored.
3. To indicate .the materials store'd in bins, racks, shelves
• must: have signs.or tags attached on them.
e tc.
4. Tbe' storeroom shoul'ci be divided inbo sections ,ahd the materials/
i go-ddsi^elpng^^ t;o,, o(ne/. particular/class should b-et stored in- each-'
‘ . ..
'"■sertioh-v an
‘ " bb. qv.« ■ r-nv-.:.,;J 55
.•
v.
'■
..
.
-
5. ;. In order to protect 'the materials from'damagebin: storage, pro-vi s ion
of proper storage space must be provided. « \ At,1
;• f .
. .6. Floor plan. showing the various sections of s torero-Om should be
posted in different parts of the scoreroom. This helps- ■eliminacing
wastage of time in the location of a particular••material.
Qualifications and ^Quali.tigs of a Storekeeper
. 1. The minimum qualification is Matriculation or equival^ht'
2. He should- have, undergone apprenticeship and training in.storekeeping
in some appropriate training insti-tute or organisation.
3. Adequate common sense to meet with different situations arising
during the discharge- of his duty.
: 7 :
4. Sound knowledge of the principles and practice followed
in his job
of storekeeping.
5-, Sound health
6. A sharp memory.
>Jo,b Description of a Storekeeper
2^2-^owie^ge: Must be familiar with perishable qualities of various
materials, their shelf life with methods of storage. Should have
knowledge of typ>es of materials and equipment used in various depart
ments. Should be familiar with the locationzof all materials in
stores and physical layout of hospital. Should be able to plan Stores
layout and establish procedures to insure rotation of stock.
Wo rk co, be per formed
1. To supervise storage 9 control and issue of macerial and equipment.
2. Io ascertain that supplies are received at proper time and in good
condition.
3. To inspect storage conditions.
4. To advise on storage capacity cf supplies not to be used immediacely.
5. To maintain perpetual inventory and posting of all goods received
into and issued from Stores,
6. To examine materials for damage and defects and accept or reject
goods.
i
H □-A 3
ABC Analysis
1 • Introduction
An organisation needs I
9°°dS f?r carryirt9 out its activities.
In order to control the
expenses. To optimise
selective control ever
over certain goods. This method is'called ABC Always Better Control?
Certain goods <are to.be
'
considered baspd on their
L'
importance to the
process in the organisation.
CV"
This is called VED.
2. Concept
ABC analysis is a new L..J^l.
tochnic'ue of classifying
duction and store inventories‘, both purchased and controlling pro—
of item.
for^material management
control of lnventoTies''and a technique
group!ng'thousandF
stock items handled
in an organisation.
- --- -.i
3. Example
......
I tern
1
2
3
Im hmm
,, <
Price
Annual Need
Value in Rs.
ABC
0.05
100
2000
10,000
500
S^OOO .
12,000
C
B
A
Oo
6
'~"**--~- 1*** "■
■■■" —---- ---
—I I
In graphical r?
representation, the curve can be drawn with the
following table
Class
% of items
Value of items
A
10C
70
B
20
20
C
70
10
4. Exercise
Item
_It.ams_ needed annuall
Value/kq.inRs..
1.
4000 kg
5.00
2.
150 kg
5.50
3.
1750 kg
4.00
4.
700 kg
8.00
5.
350 kg
8.00
6.
700 kg
20.00
7.
10800 kg
0.50
8.
4800 kg
1 .20
9.
5250 kg
2.75
10.
120 kg
21 .00
11 .
144 ki
7.00
12.
2 kg
80.00
: 2 ;
Item
13.
14.
needed annually
.4 kg
■
960 kg
1200 kg
600' kg
650 kg
30 kg
15.
16.
17.
18.
19.
20.
■ Value in Rs.
40.00
2.20
4.80
3.60
0.60
60.00
Calculate, the total -value
‘
and classify them into A, B & C items.
Describe how you would control inventor
,
'
"
’
-------------------------------
5. VED
Certain enterprises would like 1
classify
their items into vital
essential and desirable items. to
For
practi'cal
r-or
practical
corresponds to ABC items, <
'"
Cai purposes, their conthe
treatmsnt
of each item.
Each item of vital category is"treated
---- ’ according to its merit.
6~ Examples
Vital
Salt in cooking
Value in-cycle tube
Vaccines in Community MCH
Essential
Starter in a Car
Cough Syrup in Community MCH
Desirab±e
Sugar in Coffee
Upholstered seats
Antibiotics in Community MCH
1
si s
1 • Introduction
An organisation needs to stock goods for
carrying out its activities,
In order to control the stock as
inventory
'exposes. To optimise on managerial t-’me ,organisation incurs
, it is necessary to have
selective control over certain goods.
ih?.s
method is called ABC Always Better Control.
*
Certain goods are to be considered
c.
based on tl.l_ importance to the
process in the organisation?■ This is called their
VED.
2•
C?nc£2t .
dufjjVrVlVV now
and controlling pro_
both Purchased and
----i°?‘? purchased and manufactured in
accordance
with value (pri
It is the starting point
a
I
a
’
.It
for. material management. Aou analysis
is the principle of selective
control of inventories and
« technique of grouping thousands of
stock items handled in an organisalion.
3. Example
r—i .
11 e m
Price
i—
T!-.TLf“-<
—
—-
-
Annual Need
Value in Rs.
‘
1
2
3
0.05
100
2000
1• -
10,000
00
6
wt.: uufcj.«au*.
L-
ABC
1L
500
8,000
12,000
C
B
A
In graphical r:
representation, the curve- can be drawn with the
following table
Class
% of i coms
Value of i terns
A
1 0/
70
B
20
20
C
70
---------- ■■■
10
• Exorcise
Item
1.
2.
3.
. 4.
5.
6.
7.
8.
9.
10.
11 .
12.
Iteras-nggde■ d ..annually
4000 kg
■150 kg
1750 kg
700 kg
350 kg
700 kg
10800 kg
4800 kg
5250 kg
120 kg
144 kg
2 kg
Value/kg .inRs.
5.00 —
5.50 “
4.00 - Q
8.00 - w
8.00 - B
20.00 0.50 •*C
1.20 -C
2.75 - C
21 .00 -«■
7.00
80.00 « A
,ii
.
:
Item
13.
14.
15.
1 6.
17.
18.
19.
20.
Items needed
2 ?
aJJjf
Value in Rs.
Mnun.
4 kg
960 kg
1200 kg
600 kg
650 kg
30 kg
■ .-■rw—n„ i i.
•
40.00
_
2.20
4.80 —
C.
3.60 0.60 -
c
60.00 — A
Calculate the total value anc^
; ' classif
’
y them into A, B & C items.
Describe how you would control inventory’.’”
5. VED
Certain enterprises would lire
classify cheir items into vital,
essential and desirable items, to
ror
cal purposes, their cont
corresponds to.ABC items , except in practi
the
treatment
each item,
Eacli item of vital category is treated according toof its
merit’. *
■6. Examples
Vital
Salt in cooking
Value in cycle tube
Vaccines in Community MCH
Starter in a Car
Cough S. :?un in Community MCH
Sugar in Coffee
Upholstered seats
An11bijLies in Community MCH
Essential
Desirable
7
'4
T_
A-8C_Analvsis
wwr an im.v/r•.hht n
_n —i —ih wjj
1• Introduction
An organisation needs to stock goods for carrvi net cm+ i + e
order to control the sc0ck as invent!Z 9GS aCtlvlties,
^rganisa
tion
incurs
expenses. To optimise on managerial f'
it
is
necessary
to have
selective control over certain Goods
inimethod
is
called
ABC Always Better Control.
Certain good's are to be <considered tased
on their importance to the
process in the organisation
- -u This is called VED.
2. Concept
ABC, analysis is a new technique of classify: na and control line- m-V
a“"pS"„ir„uri.“r(Ii?^)’o2?n4'Jri:hse:;'=ed ^nufaotured ?n “
for material managemen
“naviv is tte wlncln^V? P0?hcontrol of Inventories and a technl^l 7 ^77?
7
stock Items Handled in an organisation.
P.
: anous an ds o.
3. Examp'l e
■iiwmm ,.x.u,
——— r-rr t i
I tem
Price
Annual Need
Value in Rs.
ABC
1
2
3
0.05
100
2000
10,000
Co
590
8,00Q
i2?000
c
B
A
6
Tx
rw
V,
In graphical r*
representation, cho curve can be drawn with the
foilowing table
Class
% of items
Value of items
A
10..
70
B
20
20
C
70
10
4. Exercise
Item
Ite^_jaeede.d ..annually
Value/kq.inRs,
1.
4000 kg
5.00
2.
150 kg
5.50
3.
1750 kg
4.00
/
700 kg
0.00
5.
350 kg .
8.00
6.
700 kg
20.00
7.
10800 kg
0.50
8.
4800 kg
1 .20
9•
5250 kg
2.75
10.
120 kg
21 .00
11 .
144 kg
7.00
12.
2 kg
80.00
s 2
Item
13.
14.
15.
16.
17.
18.
19.
20.
Describe how
4 kg
960 kg
1200 kg
600 kg
650 kg
30 kg
40.00
: 2.20
4.80
3.60
0.60
60.00
, B & C items.
5. VED
Certain enterprises would like to
classify ci ’heir items intn vit.i
to classify
oo:Xsp6nd’nt0dMctaHe it0“- For
F?r praCei
P«'-< cal
calVurptel,
purposes ShrASi
X13" lsems? except 1.1 the treatment of each item
Each i-cem o.f viral category is treated according to itf merit/
6. Examples
Vital
Essential
Desirable
Salt in cooking
Value in cycle tube
Vaccines in Community MCH
Starter in a Car
Cough S ?-j > in Community MCH
Sugar in Coffee
Upholstf- red seats
Antihior.j.cn tn Community MCH
Ao^^A.O.al.y s i s
1 • Introduction
An organisation needs ;u
scocn goods for
tor ccarrying out its activities
an
to . stock
n
order
to
control
the
scock
as
inventory
-To optimise
the —s..ock
as inventory,
----expenses.
•
7 organisation incurs '
t managerial . time, it is necessary to have
seiective control over'certain'goods
This method is called ABC Always Better Control.
Certain goods ;are to.be
'
~
considered
based on their importance
to the
process in the organisation.
-- ’
This.is called VED?
2. Concept.
Z^Snd'siorf Jnven?orSrCn^C?S!ifyi^ and c^trolling pro
accordance with value (pr’c^)’of i'-mn'Jr“T+Sed
manufactured in
for material management^ 'ABC analysis
ths Rafting point
control of inventories in.! n horhniGne Principle of selective
stock items handled In an organ^SJo”.Of 9r'>UPln9 th»“^nds of
■ 3. Example
-------! |t <
l1BI| im
,,
M
i
Item
Price
Annual Need
Value in Rs.
ABC
1
0*05
10,000
2
100
00
3
2000
6
500
8,000
12,000
c
.3
A
-ruiiiLj
In graphical representation, the curve
can be drawn with the
following table
Class
% of items
Value of items
A
1 O:.70
B
20
20
C
70
10
4. Exercise
Item
1.
2e
3.
4.
5.
6.
7.
8.
9.
10.
11 .
12.
Ijeros needed ...annually
4000 kg
150 kg
1750 kg
700 kg
350 kg
700 kg
10800 kg
4800 kg
5250 kg
120 kg
144 kg
2 kg
Value/kq.inRs.
5.00
5.50
4.00
8.00
8.00
20.00
0.50
1 .20
2.75
21 .00
7.00
80.00
: 2 :
Item
13.
14.
15.
16.
17.
18.
19.
20.
rt^^^A.._annujniy,
4 kg
960 kg
1200 kg
600 kg'
650 kg
30 kg
Value in Rs.
40,00
2.20
4.80
3.60
0.60
60.00
Caicuiate the.total value and classify them into A,
B & C items.
Describe h.o.w you would control inventory-.
5. VED
■CSMWCWMBLSMuM
Certain enterprises would like to classify cheir items into vital.
5
essential and desirable items, ror practical purposes
purposes, their control
corresponds to ABC items, <except m the treatment
of each item.
Each item of ..vital .category . is’ treated according "to* itrmeriE
6• Examples
Vital
Essential
Desirable
Salt in cooking
Value in cycle tube
Vaccines in Community MCH
Starter in a Car
Cough 3•"rup in Community MCH
Sugar in Coffee
Upholstered seats
Antibiotics in Community MCH
M Q-JS-
Vendor Analysis & Selection.
1.
To relate "the principles of vendor rating'-
2. To develop a rating sc.ale -for analysing vendors
3. To select
a suitable supplier for a given item of purchase
1 • INTRODUCTION :
A.
The ability to select reliable vendors is a mark of
successful purchasing action,
It is not always easy to
identify good vendors.
There is a saying, ’’tell me who
your suppliers are,& he willtell you what kind of a
purchasing department you have”,
Therefore, an objective
means of vendors appraisal is the best
----j method to ensure
identification of good vendors.
B* A food vendor rating system should produce results in
better vendor performance.
The people involved must be
aware and understand its uses, the system should be
specific to the organization. •
*2 • KINDS OP RATING SYSTEMS
A. Using graphs and statistical ratings
B
Numerical rating systems
C. Based on basic purchasing responsibilities.
3.
PURCHASING RESPONSIBILITIES
,A. There are four basic purchasing responsibilities,
Price
time
quality
r
quant ity
The four qualities measure overall purchasing and vendor
performance.
B• Price
Price has four measurements
1. The price of items paid Vs the target price of items
ordered.
The actual performance is compared as a ratio
of actual prices paid against a subjective target.
2. Actual buying expenses versus budgeted buying expenses.
3. Price savings achievements versus total purchasing
4. Number of items purchased
expenses .
versus number of buying items.
C* Purchase Performance Index
A rating scale assigns points on 100 points for quality,
price and service.
A typical rating scale would be
Quality
40
Pric e
55
S e rv ice
25
100
The points may vary depending
on the importance of eacn variable.
2
I
2
4 • Ex am.-ole
If all
1 . Company A supplies Rs.io/- taps for wash basins.
basins,
lots were not accepted, then the points would be’ reduced
proportionately.
Lets say that during one quarter, the
company supplied 2000 acceptable taps against.2520 then
the value is 31•£ out of 40 points.
2. For price, a list of all unit prices for taps is obtained.
To this list transportation cost and cost of non recoverable
defective materials are added.
Then the.lowest cost is
given full points and to each of other higher costs the ratio
of lowest cost Vs cost of .higher cost is multiplied by 35 to
arrive at.the point for the supplier.
5. For service,, the percentage of delivery promises actually
met. . If supplier has never missed delivery, they got 25
points.
4• in the composite rating, a total of 100 points is,‘perfect.
90-100 is excellent, 80-89 is good, 70-79 is fair and
below 70 is acceptable.
5 • Exercise
... 7
RUHSA has been purchasing chicks from two suppliers.
One of
them for the last 2' years.
Recently a competitior has
approached RUHSA.
In the past six. months the records, of the
two suppliers are as follows.-
The chicks of supplier A arrives on Thursday night by train
and. every week RUHSA vehicle redeives the chicks.
In other
words, in six months, 26 tirhes expected, the suppliers did
not send two times.
Each week 1200 chicks are obtained
plus 2% allowance for transmit mortality,
The transport
cost from station to RUHSA is about Rs.90/- per week,
The
price per chick is Rs.6.10/-.
5
Supplier B has supplied 1000 chicks every week.
Their mode
of supply is delivery at RUHSA on Thursday afternoon.
Price
per chick is Rs.6.05• They also provide 2^ allowance for
transit mortality.
About 6 to 7 times the supply was 200 to
300 less than requested and two times more than requested
and agreed.
Once they intimated shortfall by telegram.
At the end of six months who would you.rate as better supplier.
For purchase decision, what other factors need to be
considered to decide on the supplier.
** *
***
*
d/b.
•n
quantitative An.^s^for^ecision Making - An Overview-'
• .
By Dr. Tnornas P. Benjamin
choOsI^thaFcou^s^of^tiifwhiJh1!^^^11 22nc°?ns woul^like to
goals of the organisation
Theffective m attaining the
variety of aituaUons th"i cSj
d»"^o„t?d yath’a
a decision among several possible course! of SctlSn.1’
D'ake
Decision M.-,kinq
■
There <are
—
' ‘ ■
several.types
of decisions that
a manager is confronted with.
iney may be classified
------ 3 as followss
1 . Decision under cortainity. (All the fpcts are known for sure)
2. Decision under uncertainity.
event that will occur is not known
for sure but probabilities canThe
be assigned to the possible occurances.
3. Decisions made for one time period.
4. Decisions ;mad-e for
or a sequence of interrelated decisions over several
time periods..5. Decisions on issues where the opponent is nature.
'
6. Decisions to be taken when the opponent is a thinking group.
IoughtdeC1SinnS', thGr
there® is
processby which solutions are
Example:
WSrS the, charitable hospical produce several drugs for
33 ■
A
use
zhe
generate income
wancod Sno lakf/units
of a certain
The pharmacy
Should the order be
decision makings
1• Establish the criterion,
The department exists to generate income,
criterion.
Profit is the major
2. Select a set of alternatives for consideration
(a) Accept the offer
(b) Seject the offer
3. Determine the model wiiica will be used
E = a+bx
where
E - total expense to produce the additional requirement of drug
a
’ thsedrSS(KM00/:)"anUfaC';Ure °f th'-’
quantity of
b
” pe^unlt)0084 f°r the ™nufaofure of the drug (Ss.0.33 ps
x = Number of units to be produced (one lakh units)
xOtal expense therefore is Rs.38,000/-
ft s* J .
4
s 2 :
4. Determm’e which alternative optimises the criterion sec.
Expected income23.50,000
Expected expenses
Rs.38,000
Expected Profit
23.12,000
The results satisfies the profit criterion.
offer.
Therefore accept the
In order to help the decision maker, several models have been idenxified for use in management. Some of ;hese .models may be used in health
adminis tra cion.
The Mathematical Models:
• Linear P_roqrammingg
Linear programming is a imathemacical technique designed to assist
an organisation in allocating its scarce resources.
Example:
The community development department of the Christian Hospital
s
team of fiold workers employed to reach the communicy it has
adopted.,. ihe department has two options for consideration.
Option Number of contacts
Benefit co the
Total benefit
possible
community
to the community
A
100 Persons per month
Ss.100/- PgJn¥nlJ
.Rs; 10,000
B
600 persons per month
Rs. 15 per unit
Rs. 9,000
Contact
Since option A is more beneficial, the de p ar dm e nt choose
in
preference to ’B’ if benefit .to the community is the criterion?
When the options are many and large in number,-with several
constraints, the solution becomes more complex. In such situat
ions.a leasable solution may be obtained using the linear
programming technique.
z~. —I rn -Ct
1 Z-)
om-nl-
___
1
11.
I
. 1
.
Inventory Control
For purchase, storage
and-transport of raw materials models ha w
been developed to economic: on coses, effort and make transaction^
more efficient.
Example:
Expected annual demand (D), 3000 units
Carrying cost of inventory (C) ? [is.3/- per uni t per year
Cost of placing orders, Rs.5/Rs. 5/ per order
Optimum order size, (EOQ)
Q - 2.KP = 100 units
C
several such models have been developed to suit the different
conditions that arise in storage and inventory control.
3. Utility as a .basis for .Dec is ip ns
Decisions are sometimes mace to satisfy tne expected utility
rather than the expected monetary value. Under such conditions
utility'index have been developed to identify the utility value
of the commodity.
4
s 3 s
Bx ample*
J A' situation entails a certain gift of tax free exemption worth
» ORu 1 aKh ,
B situation is che alternative- choice with a probabili
v of 500/
chances of getting
««y probabilicy of 50%
cg„coS
95'G-lng thl- 9Xft ac 9x1 depending on the person at the customs
X X X.
The chance are, most people would choose ?A’ to 'B' mathematically.
B' is more a;tractive.
A = 1,00,000 x 1.0
B
4*
0.5x0
0.5 x 2,50,000
1,00,00
0
I,25,000
——B is greater than A
1,25,000
Theory
Game, chepry is a mathematical model built to arrive at a solution
wean two independent comps cing entities are at opposite ends and wann
to arrive at a fbasaibe solution.
Example
The union and the management of Christian Hospital have fixed
increase in
iv'^S
maximum increase in. wages asked by the union. The union would like
e maximise tne minimum increase in wages the management would oropcse.
Let u^ assume that the union and the management, with past history
nFl
strategies each. fhe union h-£s strategies Ui , U2. U3 &
U4 out of a -able with trie expected increase in costs, to the hospital
rf the/t'y0 parties adopt the different combination of strategies.
The matrix that emerges is as follows:
Union
Strategies
Ml
U1
U2
U3
U4
20
25
40
-5
Management Strategies
M4
M2
M3
15
35
12
8
10
11
14
2
4
Column Maximums
5
0
40
txnaAfc.Mtex 4U. ——r_—fc ■ TL
■iikiuhibi
u
.ir
12
8
2
-5
10
. f-.
<®
Row
Minimums
. »r-r-wt l-rwT'-n--
15
35
— -r- -n-!
-
jt-
12
Tinni--*: -»
The figure 20 in U1? Ml
I': indicates
‘ “
an increase of 20 lakh rupees anntv •
ally
to.
the
hospital
if
the
two
parties
,
,*----- - decide
—play the U1 , M1
strategies on tne day of the negotiations.
In this example, U1, M3 strategies will bo the most feasable
solution tnat may be agreeable to both parties, where the company
has to bear an increase of twelve lakh rupees annually due to the
wage increase, out is satisfactory to the union.
4 s
5. Queuing Theory
Queuing theory is primarily fconcerned
----with p
--processes
which have the
cu-tn^2iStiC? °f having rmdom arrivals" and
the
servicing
of the
cu^t-nurs is axso a random process.- If w? assume there
are costs
associated with waiting in line and if th-^re
-j are rposts
- ■
of
more channels we want to minimis.- the sum
. ‘ of- the costs of adding
-waiting
and the costs of providing service'facilitie
Assume patients for the lut-dicai
ottir-. of
af
medical office
at random, following a poisson
oroc^s
Th tie-argG'fac ;cir'z arriiw
-i process.
process
'h^^vife p?ocessain
f
P^Unfstan1 hour can
(one^Tlimo
).
.oh® ac
at an
2I hSXTdar
p
average number? of
Q = average number of cus.oi.wrs arriving in o.no unit of tima.
cusiomurs the facility, sorvlces
ore uni
of time, assuming no
shortage of customers.
n = number of patients eithior being
sc-r'/icGs or waiting in the sys cerr
o 1 number in the queue excluding the one bei
ng serviced
w = the time the arrival has
to Wai t in' the queue,
!
p = 4
q = 5
p/q = L 1
n
4
o
q-P
qic-'P)
w
o = O.S hr.
o
In 24 hours, 96 patients (24 hrs. x p) arrive per day.,
an average
The time lost byi patients
waitin'- ir‘ 'i;hG queue theroforeonwill
-7Z.
r
u.
’bn
(px24 hours x w'
~ '
for 48 minutes
to OohtteS tl
?2 SSK.’ PaUg V"'; :-
If the cost of operating one medical office for me year i
th°US^d’ the
- opml’nUfwg.
PR/JA/CACH^VLR
»
ABC HOSPITAL
Income & Expenditure A/c, for the year ended 31,12.1988
Expenditure
Cv Salaries and Provident Fund
C
Supplies
7,22,000
Add: Outstanding
35.000
Office expenses
r
Repairs & Maintenance
<5'' Nursing School Expenses
Miscellaneous expenses-C
Depreciation
93,000
on Building (5%)
26,000
on Equipment (10%)
6,000
on Furniture (10%)
on Electrical Fittings(10%) 2,000
15,20,000
7,57,000
41,000
2,78,000
84,000
4,000
Fees collected
In-patients
Adds Outstanding
19,84,000
86.000
Outpatient
Doctors Office
Interest on Fixed Deposit
Nursing School Income
Donation
Miscellaneous Receipts
20,70,000
3,76,000
2,13,000
75,000
78,000
20,000
12,000
33,000
N>><
Rs*
Rs.
1,27,000
Excess of Income over Expenditure
Total
Income
ft.
*«**«■*
Total
28,44,000
C^l
e>
1
Rs.
28,44,900
C-G M G
No n
I
2
d
ABC HOSPITAL
BALANCE SHEET AS AT 31.12,1988
31.12.87
ft.
33,00,000
31.12.88
ft.
Liabilities
Capital Fund
St
Balance as on 1.1.1988
Adds Excess of Incone over
Expenditure •
33,00,000
___ 33jt000_
33,33,000
3,10,000
2,000
36,12,000
Adds Additional Building
Construction
Building Fund
Balance as on 1.1.1983
Less: Building construction
Expenses
P.F. Liability
Accounts Payable
Sundry creditors
2.39.000
35,72,000
3,10,000
2,39,000
71,000
2,000
34,000
35,000
37,14,000
ABC HOSPITAL
BALANCE SHEET AS AT 31*12,1988
31.12.87
fe.
25,27,000
44,000
23,000
8,42,000
6,000
1,70,000
36,12,000
Assets
Fixed Assets(as per Schedule)
Security Deposits
Festival Advance
Accounts Receivable
Fixed Deposit
Cash in hand
Cash at Bank
31.12.88
fe.
26,84,000
44,000
23,000
86,000
8*42,000
5,000
30,000
37,14,000
ABS HOSPITAL
Details pf Fixed Assets as pn 31.12.1988
”
(Es. in thousands)
Si.
No.
1*
2.
Particulars
Land
Building
3. Equipments
4. Furniture
5. Electrical!
Fittings I
Total Rs.
As on Addi
1^.88 tions
Rs,
fe.
615
2745
239
550
45
223
82
Depreciation
’ iritten Down Value
Bate of
on For the As on
31.12.88 Depre
ciation As
year JI .12 .88 31.12.87 31.12.88
1.1.88
fe,
fc.
As on
J2s___
615
2984
595
223
82
1132
334
164
58
5%
10%
10%
10%
M* «■«•*«» M.
4215
w——
284
4499
1688
*****,***T^h*
93
26
1225
6
2
170
360
60
*
«■ •» W a****!* «N»
127
•••*«»■»«»<•
615
1613
216
59
24
1815
615
1759
235
53
22
•• OSW * 4» —*|w> «»«•*•■«»*«» ••
2527
■>
•» *• ••
•*s»4Beo»
I
I
2684
■»•»*••• •»
I
I
21
5 in
i on
r tions
a given
nancial
ousting
ih.nces
e and
>r od of
s ; de red
2: c Acr' sition
ranciai
C’r' SUD-
h zspitai
?are Inmis re
gion,
atement
irce and
:es procnowing
a by the
and that
jeriy un■. aluable
2 maiion
■ :ng and
cn
(New
Comparative income statements and balance sheets for Hopeful
Hospital are presented in figures 111 and 112. (The changes in the
unrestricted fund balance are assumed to consist only of the net
income figures as shown within the fund balance section of the bal
ance sheets. Consequently, a separate statement of changes in
fund balances is not presented here.) Clearly, these statements
provide a considerable amount of essential information concerning
the operating results and financial position of Hopeful Hospital. Intel
ligent decision making, either by the hospital’s management or by
interested external parties, requires such information. Is the infor
mation provided in these statements alone sufficient to the needs of
management and external users? Is the information complete: does
it clearly reflect all significant investing and financing activities of the
hospital during 1977 and 1978? Do income statements and balance
sheets alone adequately deo:ct the flow of resources into and out
from the hospital enterprise? In each instance, the answer is no.
Nature of the
Statement
Figure 111
Hopeful Hospital
Comparative Income Statements
Years Ended December 31. 1978 and 1977
Gross patient service revenues
Less deductions from revenues
Net patient service revenues
Other operating revenues
Total operating revenues
1978
$9,490
890
8,600
633
9.233
1977
$8,870
780
8.090
519
8.609
Less operating expenses:
Nursing services
Other professional services
General services
Fiscal and administrative services
Depreciation
Other
Total operating expenses
3,188
2,030
1,610
1,460
540
315
9.143
2.995
1.920
1.540
1.370
465
292
8.582
90
195
27
154
$ 285
$ 181
Operating income
Nonoperating income
Net income for the year
Certain important changes in financial position and certain vital
aspects of the financing anc nvesting (capital) activities of Hopeful
Hospital are not disciosea by or made clearly apparent from an
examination of its income statements and balance sheets. Con
sider, for example, the following items drawn from the balance
sheets in figure 112:
3 :olic AcLong-term investments
1978
si.010
1977
S
600
379
I
ffi/JA/CMCH/VLR
ABC HOSPITAL
anil Payments A/Qt for the year ended
Opening Balancas:
Cash in hand
Cash at Bank
Fees collected
In-patients
Out patients
Doctors Office
Interest on Fixed Deposit
Nursing School Income
Loan
Donation
Miscellaneous Receipts
Total
6,000
1,70,000
19,84,000
3,76,000
2,13,000
75,000
78,000
34,000
20,000
15,20,000
7,22,000
41,000
2,78,000
2,39,000
45,000
84,000
4,000
Salaries and Provident
Supplies
Office expenses
Repairs and Maintenance
Construetion/Extension
Purchase of Equipments
Nursing School Expenses
Miscellaneous expenses
Closing Balances:
Cash in hand
Cash at Bank
5,000
30,000
____ 12^229.
Rs.
fc.
Payments
fe.
Receipts
Total
29,68,000
Rs.
29,68,000
J)
‘=’7^—
O'
if rv^ I ,
• e*'
ffi/JA/CiEH^VLR
»
ABC HOSPITAL
Income & Expenditure A/c, for the year ended 31,12.1988
Expenditure
Salaries and Provident Fund
7,22,000
Supplies
Add: Outstanding
35.000
Office expenses CL.
Repairs & Maintenance
LL Nursing School Expenses
Miscellaneous expenses^
/ v. Depreciation
93,000
on Building (5%)
26,000
on Equipment (10%)
6,000
on Furniture (10%)
on Electrical Fittinqs(10%) 2,000
15,20,000
Excess of Income over Expenditure
33,000
'* : mC,- .-J-,)
4‘
'
e> P-e-
7,57,000
41,000
2,78,000
84,000
4,000
-TR/K-'C
Rs.
Fees collected
In-patients
Adds Outstanding
19,84,000
86,000
Outpatient
Doctors Office
Interest on Fixed Deposit
Nursing School Income
Donation
Miscellaneous Receipts
20,70,000
3,76,000
2,13,000
75,000
78,000
20,000
12,000
1,27,000
«»«*
Total
28,44,000
Total
i!
Income
ft.
fc.
«■
28,44,900
■d ? e <
'V^C
f
No N
I
3
d
ffiZ, Canteen
Income & Expenditure Account for ths year ended 31.12.88
Expenditure
Ss.
Catering materials
Fuel Expenses
Salaries & P.F.
Newspaper & Periodicals
Postage & Telephone
Printing & Stationery
Travel & Conveyance
Light & Power
Audit Fees & Expenses
Repairs & Renewals
Contribution to Head Office
Staff Welfare
Sundry Expenses
Provision for Gratuity
Cooly and Cartage
Sundry Articles
Depreciation
Excess of Income over Expenditure
9,77,377
Total
45,502
2,69,403
822
Income
Rs.
Boarding Charges
Membership Fees
Interest on Fixed Deposit
Jniscellaneous Receipts
14,09,200
825
4,302
7,341
4,235
5,058
720
20,198
1,500
12,009
25,000
11,372
6,566
8,963
1,450
1,363
23,547
6,583
fee
14,21,668
Total
Rs.
14,21,668
3
XYZ CANTEEN
BALANCE SHEET AS AT 31,12.88
fc.
Liabilities
Outstanding creditors for expenses
and supplies
Security Deposit
Board Deposit
Activities Club
Gratuity“Fund
Equipment Replacement Fund
Provision for Major Repairs
Capital Fund
Balance on 1,1.88
Ps.
1*24,104
1,500
21,035
707
58,716
30 ,000
7,500
89,426
Add: Excess of Income overl
Expenditure I
Total
6.583
fc.
96,009
3,39,571
< teeeaMtvoOam «•***«»
Assets
Current Assets?
Cash in hand
Cash at Central Bank of India
Petty Cash in hand
Stamps in hand
Cash in Savings Account
Sundry Debtors
Accrued Interest
Advance to staff
Sundry Advance
Deposit with Traders
Investments:
Fixed Deposit with Central Bank
of India
Shares in Co-operative Society
Fixed Assets:
Food stock
Fuel stock
Linen stock
Crockery & cutlery
Furniture
Equipments
Electrical Fittings
Bs.
Total
Rs.
Ps.
4,828
9,048
425
15
5,500
55,374
9,449
21,050
500
9,000
60,500
200
35,830
1,022
4,785
4,185
4,430
85,680
____ 27^750
* ’3,39,571”
ALfW CANTEEN
Com pelt a*! ve S‘ta±emen't of Income &. Expenditure
1937-86
Increase
1 OCoO 15,73,545 100e0
17,48,673
11 .1
Co6
15,844
100.8 15,85,695 100o6
17,64,517
69,6
12,19,744
13.4
1986-87
%
Decrease
IKCOKE:
Board Charges
Total
12,150
0.8
Other income
EXPELBITURE:
Materials:
Catering
Expenses
(including
fuel etc)
65.4 10,76,009
LABOUR:
Salaries &
wages-P.F etc*20.9
3,28,321
19.7
3,4^,999
5.1
Gift to staff
0.5
8,672
0.6
10,484
20. 9
Staff welfare
0.4
6,044
0.4
7,316
21 .0
Provirion for
Gratuity
2.6
41,709
2.4
42,463
1.8
Maintenance and
other expenses: 5*6
87,570
6.0
1,05,242
20.2
30,000
1.7
30,000
EK?
7,370
0.2
4,269
EXPENSES:
Contribution to
1.9
<
Excess of Income
over Expenditure 0.5
Total
100.8 15,85,695 100.6 17,64,517
42.0
CaNTEEN
STATEMENT of FINANCIAL POSITION AS ON 31st i.TAKCH’SB
A.
RS
CURRENT ASSETS:
RS
Cel er. in Hand
11,013
15
Stcrr-pE in Hand
Cash in Current Account
13,809
Cash in Saving Account
4,876
Cash in Fixed Deposits
77,199
6, 6S3
Accrued Interest
Debtors
48,163
Advance to Staff
13,273
Stock
45,950
0
Lc
FUZED ASSETS:
2,290
Deposits with Traders
100
Inve stments
3,435
Linen
Crockery
8,714
Cutlery Stock
Furniture
4, 992
Equipments
51,291
Electrical Fittinge
2,901
o
Co
2,20,981
2,94,704
CURRENT LIABLITIRS: .
Sundry Creditors
73,723
1,17,319
707
Activities
Provision for Gratuity
49,753
Provision for Repairs
7,500
o
Net total of (A+b/ - C)
1,75,279
1,19,425
REPRESENTED BY FUND BALANCES:
Equipment Replacement Fund 30,000
Plant Capital
;
General Reserve
71 ^33
66,540^
IQ' o
1 ,1 9,425
t
c
r
c
Figure 114
Hopeful Hospital
Statement of Changes in Financial Position
Year Ended December 31, 1978
i
i
I
<1
i
■ I
c
c
c
Sources of Working Capital:
Funds generated by operations (schedule 1)
Issue of 6% bonds
Sale of long-term investments
Sale of plant assets
Total sources
$ 832
3,000
49
54
Applications of Working Capital:
Retirement of 7% bonds
Purchase of long-term investments
Purchase of plant assets
Total applications
2,400
450
940
i
c
f(
tl
u
n
tt
n
a
145
$285
$540
16
556
841
ir
9
Z
fc
h
d
$832
Working capital provided by operations
Schedule 2:
I
December 31
1977
1978
Increase
' (Decrease)
Accrued interest receivable
Accounts receivable (net)
Inventories
Prepaid expenses
Total current assets
$ 124
45
1,536
175 .
___ 32
1,912
___ 40
1,830
$(156)
15
196
35
____(8)
82
Accounts payable >
Accrued expenses payable
Deferred revenues
Total current liabilities
302
208
___ 77 ,
587
370
220 ;
____ 60 .
650
(68)
(12)
____ 17
(63)
$1,180
$ 145
Cash
Working capital
J
II
C
$
Less items included in income statement
but not providing working capital
Gain on sale of long-term investments
i
C
3.790
Total
j, i
6
6
$3,935
Increase in working capital (schedule 2)
Schedule 1:
Net income for the year
Add items deducted in income statement
but not requiring the use of working
capital
Depreciation expense
Loss on sale of plant assets
r
$1,325
$ 280
30
1,340
140 .
■
i
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I
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V(
J7
Administration of Fringe Benefits . Welfare Amenities and Terminal
Be nef.it
VK CALLA
I. Ad OVERVIEW
In the villages ip India, workmen were generally paid in kind.
Somehow this" system- persisted in- industry, albeit as. an_ adjunct.
Th^;J"T5aterAaiisti-b,’!'industrialis.t<'tried to. improve his image by
-^ibviQincT many supplementary bon efits, hoping thereby to attract
or retain "better" workmen. In times of scarcity, war? etc
such
benefits as "Grainshops" certainly, eased the P^^r®0°"0^e
distribution system. They also provided tax. relief, to both. tf>e
employers and the employees. To achieve their objectives these
benefits have to be administered in abusiness like manner and there
has to be a strict fi nancial audit 'and control over the same. They
have also to be judiciously selected in response to a felt need . .
Then only will they Lead to meaningful adjunct to the pay packet.
II. Whac are fringe benefits
Us, in addition to wages, generally in kind,
All supplementary benefits
which
to the employee, from the employbut sometimes in cash, u’..l*■ ' flow
‘ "cost" - cons ti.tu te .what .a re. generally
er and to whom they constitute
JSrmed as fringe benefits Jn Industry.^TM^encompas^the^perlod
from the time one is recruited,
when one has retired. They, may constitute many "allowances” like
allowance
.
or.city allowance or
the "bad climate"
-—
comprise
of
such
facilities
as sports
transport allowance or may
clGb/free
-library or hobby clubs - organised by the employer for
club- ■
the employees benefit. They als
also fulfil a social nee .
III. Their History
KTo doub'o they grew out of the npacernalistic approach of the
empWer; Awards the empLoyeos. History also played xts part and n
uued. Che employers diet chink chat certain allowances,
in some instances
would not be included in the def ini cion of wages, and hence were
introda
ced. Many a time tax relief was given for such welfare
amenicies and hence they were introduced. Some were introduced,
ft,
,,
arninshio, etc., to supplement the public distribution
system.' But they all tended to improve hopefully to garnish the
public’image of the cooperatives which hoped to attract or retai
betcer employees.
IV.
Various types of fringe benefits
A. Cash Allowances: If an employee performed any auxiliary duties,
in addition to his substantive duties, or if his major duui^s
involved considerable risk, hazard or unpleasant working conditions, these were compensated by allowances, which were unrelat
to the basic wages. Examples can be cited as:
a. Tiffin allowance - wh? re one ;had to travel distances away
nd where canteen subsidised meals were not_available. ,
b. Bad climate allowance for working in areas/locations w^®re
working conditions were not conducive to good health and
c . Cash allowance for handling large amounts of cash.
work" allowance for working, and thereby being
d. "Sunday
deprived of the social conveniences, on a holiday/Sunday.
"Good conduct" pay - where wacchman/workmen show excellent
results due to their deligience, vigelence.
f. No accident bonus for motor vehicle drivers.
e
«-
: 2 s
»•
B. Benefits in Kind
a. Uniforms to all workmen , even though no law enjoins such uniforms.
b. Washing arrangements for che above.uniforms (or washing allowance
in lieu).
c. Medical benefits - supplementing the ESI benefits.
d. Housing
e. Transport arrangements to and from work.
f. Schools for children.
g. Sports clubs, dramatic clubs, free library, cinema shows.
h. Celebration of founders’ day, impactant festivals, independence
and republic days and distribution of gifts.
i. Long service awared to all employees, after specified number of
years being put in.
j. Welfare fund/death relief fund , where benefits are bestowed upon
employees, on specific events, e.g. Industrial tours, deaths, etc.
k. Retirement gifts, pension, etc.
C. Supplementary income for wives and children of employees
a. work centres for wives, where they can learn useful skills like
stitching, flow decorations, etc., and thereby earn money in their
spare time.
b. scholarships for outstanding children to help them go through
their education.
D. Educational and cultural activid.es
a. Filmshows on public health and hygiene and family planning.
b. Dramatics
c. Hobby clubs
d. Talks, lectures. seminars ecc.
V. Statutory Fringe Bern fits
Provision of fringe benefits by the employers notwithstanding, the
government has passed various laws wherein provision has been made
for facilities to workmen.
For example under the Factories Act, 1948, cool water, canteens,
to be provided.
creches, washing facilities, etc., have
1 .
Under the Employees, Provident Fund Act 1952, and the Payment of
araiuiuwb
iv/i, when an employee retires he has to be paid Gratuity
GratuiUes mul
Act 1971.
at specified rates and he has to be paid his provident fund accumul? •
ions on superannuation-r
Since these are statutory obligations, these may not fall within che
definition of Fringe Benefits. 1But. if an employer gave gifts or
beyond the limits set in by these acts, those differential benefits
could be included in the definitions.
Similarly, various states have passed Labour Welfare Fund Acts,
wherein provision is made to constitute a contributory fund, by the
employers and employee? out of which welfare programmes for the
employees are financed, These are a supplementary benefit to the
employees.
? 3 s
VI. Their administration
a. It has been the experience that these ventures must be jointly
administered.
b. These are non-controversial areas, for' the commop good, and hence
union rivalries should not be allowed to creep in.
c. Such an approach will help them to learn and get trained in the
act of participative administration.
d. Vision is needed in blending all the various kinds in a manner
that will answer the felt needs of the employees.
e. A strict financial control is needed in all the transactions.
f. Audited accounts and the annual report should be presented regularly.
g. These activities should be carried out in the ’’open” and no hushhush atmosphere should prevail. One way is to ensure that monthly
reports are published for the benefit of all or that observers
are invited to ’’sin in” on the meetings.
h. These
are....
not’’favours” to be manipulated by either
--- - 'benefits ---party to patronise selected few.
i. The progress of all these schemes should be reviews periodically.
If they have outlived their utility, they should be discarded.
j. As the felt need arises, new projects must be devised.
k. Whether there should be free or be on contributory (nominal for
employees) would depend on each factory.
VII. Conclusion
In this manner only the objectives for which the fringe benefits,9
retirement benefits and welfare schemes are deviced can be achieved.
* * *
r
n
/"
Financial Budgetting
.. >
■ f;
Definition
?
i * Period"f3r“ the
— J purpose of attaining
expenditure and the
-i the
of budgets.
dually prepared annually, butmay
W creation
updated dS^
; the
a givL ob^chUve
yeaf!
Tf
ing-
Purpose
Budgets are needed :for three reasons:
1 • To show the financial
■ implications of plans.
2. To define the resources required to achieve
the plans,
3* To provide a means of
measuring, monitoring and controlling results
against the plans.
Benefits
organSion
P°liOy iDto
lai
terms, which in an
ultimately, policies Ican be
upon
eanS%9^ito-af^y0-:-Pnl!y-epOnly-Ca^
la- which control• can be
upon which performance
and ayo^watL^rb^eTa^o^efi:” “T1’ anticipate
' '
problems,
your plans because it shows
ells you how you are
a
progressing against
compares with the expenditure
® exPenditure j actually incurred
budget for every iten of
was planned . Unless you have a
hand.
expense, expenditure is likely to go out of
•^^tMe^^lDiaadyantage^of^aidgetinfi
The^advantages of budgeting are as follow,
as follows:
1) Budgets help
? coordinate all functions ,
of the organisation,
2) Budgets pprovide
overall
guidelines
for
achieving organisational
• bjectives.
3) udgets are
valuable in
are valuable
in analysing planned operations.
.PerformancWrStion
formalize t^Sase^bj^c^vls
be USed to judSe
« Beo.se ^,
ta serve
CTents
budgets
management predict
eorreetivraS;Vn‘hey hel<>
The disadvantages of 1
budgeting are as follows :
1) Budgets may restrict the
organisation to following only one plan
ofaction.
2) Unrealistic
employee reaction
may results negative
negative
5) Specific
supervisors and "SJloyee^°believeithatti''l t0 ?Mtlro1 003 *= If
are s pent in a -n?en? per^Xa^ ^tV^ —ed
for the next period.
*
.<»•
'<•
’ :
2
°.
Insii-tutions whifc'h- receive foreign contributions are reually •
required to present .’a. feudget to the fund ing agency, on the economics
of the projects proposed^ The budgeting also acts as-a sarft ion to
• the chief executive. ,f dr the 'Expenditure: and commitments and any
expenditure* beyond', the bydget K.mit may need the approval cf the
management ‘committee.
The purpose of any budget is to plan the course cf acti vt d es
and budgetary control necessarily involves Constant watch on the ;r
actuals as against the budgeted figures. Actual performan ces'are
... . o Tcompared with the budgeted figures at the e nd of each-budget period1 arid
the variances are studied. Variances may . be< favourable or, unfavourab le .
Where the actuals are-Idss than the bid geced figures, it is Cralled
’’Favourable Variance (fF^V:, and; the actuals in excess of budgeted
figure ic Called ’’Adverse Variance (A)”. Variances may also be
'
expressed in percentages of the budgeted figures, so that the' relative
seriousness is indicated. Any deviation, whether Adverse. (A) or
Favourable (F) has to be carefully studied since favourable variance
;
(F) may also indicate, non-implement ation of certain programmes or igina-lly . . .
envisaged. SimiXarl-.y/-an Adverse Vari an.ee (,A)- ' may be ..c^sed due to
inef f iciency^on ..’cosLt-escalation br due to certain commitments originally
not envisa.g^A*
-V'
•
Where the circumstances change on wh? re there is achange in v
thinking, thus requiring budgeted estimates to be altered or modi fied,
the• management-'Committee may revise the bud get accor ding ly.
■
.
-v- =
■■
•
A simple-budget analysis -to study the deviatiore may be as follows:
Budget
Actual
Variance
A*
F*
■
Receipts
. • 1 J■
Subscription, grants, donations
etc.
Less: Workshop/programme expenses
Less: Capital commitment s
Less: Administrative overheads
Surplus/Deficit
A*
Adverse
i
•7
;
- 17
F* - Favourable-
Budget may again be classified as capital budget; and revenue
budget. Capital budget will only reflect the grants, dona tt ors'etc.
With specific purposes and the capital commitments proposed. Whereas
the revenue budget would reflect receipts of general nature and routine
and recurring expenses:like programme expenses, allowamces, admini
strative overheads, office maintenance etc.
While preparing a budget, one should distinguish he iw ea n capital
and revenue, and between fixed and variable expenses. Fixed expenses
occur irrespective of the volume of the activities, w hez^es v aria ble
expenses ma vary on the basis of activities. Fixed expenses (Rent,
salary etc.
Variable expenses (travelling, prog rammes, meets etc, )
-
4
:
3 : ’
A properly executed budgetary plan is one cf the most useful tools
of management , resulting from the accounting plan an d-s heu ld. lead-to im
proved financial results. This plan includes three major budgets:
1. The Operating Budget - which consists of the accumulated estimates
of operating revenues and expenses for the next fire rc ial year (s).
2. The Capital Budget - consists of investment in assets to be acquired
during the year.
■
3. The Cash Budget - consists of accumulated estimates of monetary flow
requirements and the source of funds for the budget period.A
cash budget can be dfeined as a schedule of future cash receipts and
payments.
Operating Budget
Proforma for Budget Preparation
Income/Expense
Heads
Actual
Last year
Current Year
Budget
Actual
•Budget Next ye ar
Propos ed
Apple veci
Budget Preparation
.The preparation of an operating budget and cep itai budget is
initiated by the accountant/business manager by preparing a financial'' via
ble framework and requesting department leads to forecast their iix omc«
expen sos and capital needs for the comirg fiscal p? riod • Budget state—
ments and supporting schedules are then reviewed and consolidated by the
budget committee and finally approved by the governing board. The cash
budget is prepared by the accountant after finalisation of the other
budgets.
Dartmental Budgets
Set out what needs to be spent in each department for achieving
the targets, for research and development programmes and for providira
the. administrative and service facilities required to run the organi
sation. They will be based on forecast and budgeted activity lev? Js
Each departmental budget will set out staff on labour costs and the
costs of any activities controlled by the department. In addition:
The administration budget will rover the ccsts of all central services
provided by finance, personnel, management services, legal, property
public relations, pensions and the organis atiom f fi ce. Any other
'
expenses such as insurance, depreciations and outside profession 1
services which cannot be changed directly to otter departments will
be included m this budget, which will be divided int os ection for eroh
service department or area.
The research and development budget will cover all the research and
development expenses of the comp,any, including the operation of rese a ch
establishments, the costs of buying external research and the costs
of any material used.
•: •
r 4 ■: .
•
■
The Capital* Budget
;.Fo5ecasts Will cover all capital investments on equipment reeded
m the budget year. Each department will be required to submit its
own. capital expenditure, proposals which will be incorporated into tfe
capital budget as long as they are accepted as forming a valid part
of the long-term capital investment programme..
. ...
The Cash Budget: translates the operating budgets foi.f
r each function
and department which have been -prepared
as revenues
and1 expenses-ylo
expenses'
. .
----- ---cash inflows and .outflows. The object of the
tte .cash bud ge
ge't
‘c is'
i to
ensure that the right amount of cash is on-hand to ope ra be - the- •business, yet_ at the-sane time to ensure that no cash is lying idi>
It is necessary co plan a'nd budget for the inflw and ouTfTov of f7ah”'''
from all other sources so that a funds flew budget can be prepared
and cash flows contro-lTod agarnst- that budget®
X£e Master budget will -co-rollate • all -tire- inf om at ion pceDared during
budgeting process. Besides setting out theoperating capit
cash budgets, the master budget will include„.__a te-la re erhe et’, aa Incom
Incomand Expenditure account ,_ahd... a--aeurce" "and application
----------- cf
_• fundq
funds ......£1...
In
statement•..-.-^epartin^tal budgets 1will
■“ be prepared whie h will be the
basis for controllingj expenses.
:
.
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^7-
Pinancial. Budget
Definition
•j
^nploySent^of^oapital^ ’Kd^ti^dS0”^?'
Budget, are usually
jfiX*
Purpose
Budgets are needed for three
re as ons :
1. To show the financial
implications of plans
2. To define the resources
required to achieve •the
”
plans,
• 3. To provide a means of
measuring,
.monitoring
and
against the plans.
I controlling results
Benefits
Budgets translate
organisation is thp nnivpolicy into financial terms, which in an
1:;
\ ^pressed, it is certainin which,
wl?ich’ ui
ultimately,
>
policies
<
can
be
xercised. Budgetary ^ntrol^ °nly ba3iS upon which control
. can be
•
be monitored and^X.tly
lep^d!
is the
only J^asis
upon which performance
and avoidSraste.f°ASbufgftO^h t“ {'?•“■ ubead, , ■■
anticipate problems.
Progressing against
actually
incurred
^dget for eVery
Sfi”“L’ iS;^
—you have a
> go out of
■-^^g^^Oisadvantage^of
fidgeting
I^e_aAYant..ages of budgeting
are as follows:
h-P 000riin^? ail functions
.b?£ttLePf7ide 0Vera11 Jeunes for of the organisation.
achieving organisational
3) Budgets are valuable in
analysing planned operations.
Since budgets
1
formalize
expectations, they can be used to
performance in relation to
these
Judge
5) Because budgets serve as f ' ----- ) objectives.
indicators of fnture cents, they holo
management predict; problems
and take
■J corrective action.
P
The . disadvantages of
budgeting are as follows :
1) Budgets may
r"
restrict the
orsanisatl on to following only one 'plan
ofac tion.
2) Cnrealisti
noaotion^lfStfade by ’■Mage.wnt
employee :reaction
*ay result in
if those objectives
5) Specific department
cannot be met. negative
auparvlaors-and'MolXs 10^,?1’1' “oentive t0
control costs if
ano
re spent in a current o,..^-ihf GVe that unless budgeted amounts
for
notr-f- period.
period, smaller amounts
or the next
will be allocated
I
1. v
A •
■ «S
: 2 s
*•-
Institutions which receive foreign contributions are usually
i. required., to pxe$(ent a budget to the funding agency, on the economics
r. ■ of the projects, proposed. The budgeting also acts as a Sarpt ion to
the •criief executive for th^' expend!ture and commitments and any
expenditure beyond the'budget*limit may need the approval cf the
management committee.
-;■>
f uo
s.
■
•
'•
The purpose of. any budget, is to plan the course of activiti.es
and budgetary control neces’s'billy involves constant watch on the
actuals as against the' budgeted figures. Actual performances are
compared with the budgeted figures at the e nd of each budget period and
the-Variances are studied. Variances m.ay be favourable or unfavourable.
Where-the- actuals are less than the bud geted'figures., it is called
r .r; "Favourable Variance (F)”, and the actuals in excess, of bud ge ted ..
figure is. .oalled ’’Adverse Variahce (A)”. Variances may also be
expressed in.-.percentages of the budgeted figures, so that the relative
serio..us.ness is indicated.'- Any deviation, whether Adverse (A) or
r_- Favourable (F) has^tb be carefully studied since favourable variance
(F) may . alsg < idd’icate non-implement at ion of certain programmes Originally
envisaged.: Similarly, an Adverse Variance (A) may be ca» sed due to
•i-ribfficiericy on cost-escalation or due to certain commitments original?
not envisaged.
W^ere the circumstances change on wte x.e there is ach ange rin
Wirikihg, thus, requiring budgeted estimates to be altered or modi fied,
the management-committee may revise the budget accordingly.
* •.
> .Vc?-: . <•' '
A'
A simple budget analysis to study trie‘deviatiors may be as follows:
..I
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• •••.• r-'"
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Budget
■
Actual
Variance‘
A*
Receipts
Subscription, grants, donations
etc.
Less: Workshop/programme expenses
Less s Capital commitment s
Less: Administrative overhe ads
F*
t-
6
Surplus/Deficit
F* - Favourable
?
Budget may agaia-be classified as capital budget and revenue
budget. Capital budget will only reflect the grants, donations etc.
With specific purposes and the capital commitments proposed. Whereas
the revenue budget would reflect receipts of general nature and routine
and reg^urring expenses like programme expenses, allowances , administrative overheads, office maintenance etc.
A*
Adverse
WhLLe preparing a budget, one should dt stingujlsh be iw ea n capital
and revenue, and between fixed and variable expenses. Fixed expenses
occur irrespective of the volume of the activities, w he Jens variable
expenses ma,.y. vary on the basis of activities. Fixed experi ses (Rent,
salary
a'
Variable expenses (travelling, programmes, meets etc.)
: 3 : •
• A properly executed budgetary plan is one of th? most useful tools
of management resulting from the accounting plan and should lead to im
proved financial results. This plan includes three major budgets:
1. The Operating Budget - which consists of the accumulated estimates
of operating revenues and expenses for the next financial year (s).
2. The Capital Budget - consists of investment in assets to be acquired
during the year.
3. The Cash Budget - consists of accumulated estimates of monetary flow
requirements and the source of funds fOr the budget period. A
cash budget can be dfeined as a schedule of future cash receipts and
payments.
Operating Budget
Proforma for Budget Preparation
------ -----------
Income/Expense
Heads
Actual
Last year
Current Year
Budget
Actual
Budget Next ye ar
Propos ed
Approved
Budget Preparation
The preparation of an operating budget gad cep ital budget is
initiated by the accountant/business manager by preparing a financial'/ via
ble framework and requesting department te ads to forecast their ire omc,
expenses and capital needs for the coming fiscal pericd. Budget state
ments and supporting schedules are then reviewed and consolidated by the
budget committee and finally approved by the governing board. The cash
budget is prepared by the accountant after finalisation of the other
budgets.
partmental Budgets
Set out what needs to be spent in each department for achieving
the targets, for research and development programmes and for providing
the administrative and service facilities required to run the organi
sation. They will be based on forecast and budgeted activity levels .
Each departmental budget will set out staff on labour costs and the
costs of any activities controlled by the department. In addition:
The administration budget will oo ver the costs of all central services
provided by finance, personnel, management services, legal, property,
public relations, pensions and the organis ationoffi ce. Any other
expenses such as insurance, depreciations and outside professiornl
services which cannot be changed directly t o otter departmeats will
be included in this budget, which w ill be divided intosections fbrerh
service department on area.
The research and development budget will cover all the research and
development expenses of the company, including the operation of research
establishments, the costs of buying external research aid the costs
of any. material used.
V•
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The-Capital Budget
■■ -.t
Forecasts will cotfer all capital investments on equipment needed
in the budget year. Each department will be required to submit its
own capital expenditure proposals which will be incoi^porated into the
capital budget as long as they are accepted as forming a valid part ’
of the long-term capital investment programme.
The Cash Budgets translates the operating budgets for each function
and department which have been prepared as revenues and expensesylo
cash inflows and outflows. The object of tte cash budget is to
ensure that the right amount of cash is on hand to operate the
business, yet at the same time to ensure that no cash is lying idle.
It is necessary co plan and budget for the inf low and outflo/v of cadi
from all other sources so that a funds flow budget can be prepared
and cash flows controlled against that budget.
The Mas t er budget will corollate all the information prepared during
the budgeting process. Besides setting out theoperating capital and
cash budgets, the master budget will include a balancesheet, a Inconi
and Expenditure account, and a source and application of funds
statement. Departmental budgets will be. prepared whie h will be the
basis for controlling expenses.
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fWdambntais of 'book-keeping
•
JlLQ^c i al Ac c oun t i ng is the.pro cess of
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recording, classifying,
summarising and interpreting financial t i*ans ae t i ons. So okkeeping is the art of keeping accounts in
a regular and
systematic manner,
. •
The purposes for maintaining accounts are:
?
- To keep track of day-to-day financial transactions
- To determine the- net result of operations of
an institution
over a period of time.
- To know at■ any given time.vthe level of stock, cash/bank
balances, ■value of assets, what.Is due and what is owed
for effective control over .-different assets and liabilities.
- To provide required information^and submit repprts/returhs
to do no rs, statutory authorities,,
goverhment agencies' and
othets as
required.
’
— To htelp the management in planning, controlling and decision’’
9
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making in all financial mat.-ters.
TLyinc ip les of Accountancy
Accounting statements are not only re quired by the management
for it\s own use, hut by many others like
potential donors,
funding agencies and Government departments,
-It is therefore
important that .the information cconveyed through the financial
statements .is understood by all persons using thenl, in the
same sense that was orignianny intended., To ensure this,'a
universal accounting language has been .scientificii ally developed
with clear guidelines known as’Prineiples of Accountancy’.
1. The^Entity Concept; In this- principle, the owner /managem ent
and other institutions like.-hospitals are treated as
separate and distinct entities.
The financial transactions
are recorded -in-.thb bonks of accounts from the point of.
view.of the institution -as an entity.
—Aqcrual Basis of Accountancy; The accrual basis of?! account —
ing is founded on the principle that, to- properly measure the
net income of a business for a given period of time
f it is
essential that all the revenue earned during that period and all
the related expenses assignable to-: the period be considered.
This process of matching the. revenue of a period, with .t4ie
expenses of that period, regardless of when, whether or how
much cash haS been received or paid, is the central g^al of
the accrual basis of accounting.
.
2 ;
.
- 2 Z^?-e—±iar-sactions Concept; Given that a Community Health
project is an accounting entity, the results of the
transactions affecting that entity must be included in the
accounting records and reports.
-^L4g lost Valuation Concept: The cost or the price paid to
acquire an item is generally the most useful basis of
valuation for purposes of the permanent accounting record.
••
•
f.
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5- ghe_?ouble Entry Concept; The accounting records should
only reflect,
on a cost basis,
not
all transactions of the
but also be constructed in such a manner as to reflect
the two aspects of each transaction, ie. the- change in
entity,
asset forms or the change in assets,
and the change in the
source of financing - liabilities.
atching Concept: If the results
of a particular operation
are to be described objectively,. i_
not only must income and
expenses of the same accounting period be brought together
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but also associated revenues and expense .items must be
matched in order to properly determine net;income.
.Accounting Period Concept: The management‘of an agency
periodically needs to know 'how things are going'.
This can
be done by preparing a statement of account which will give
a consolidated picture of all transactions during a particular
At what intervals are such, statements prepared?
A
twelve month period is normally adopted for this purpose.
'
period.
This time interval is called accounting period,.
8- 2he_M.oney Measurement Concept.; Under this principle
all
transactions are recorded in terms of money.'1 ■ Any event that
..cannot be expressed in terms.of money is', not recorded in
■ f <E
the account books.
..P • Z^Q^V^lAgiable Objective Ividenee. Concept;
This concept means
that all accounting transaction.s should, be evidenced and
supported by documents.
These supporting, documents eg.
invoices, correspondence, vouchers etc. provide the basis
for making accounting entries and for later verification
by auditors.
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3
BASIC TERMS IN ACCOUNTANCY;
1 •
Assets:
Assets are things of value owned,
Anything that will
enable the institution to get cash or a benefit in future
is an asset.
goods,
cash,
Money owing by clients/patients,
stock of ’
are all
equipments, buildings etc.
furniture,
assets.
2. Liabilities:
Amounts which the institution owes to persons such as
suppliers, banks,
3.
staff and contractors.
Capital Fund;
The. total investment in the business/institution through
contributions from owners/donors.
4. C apit al Bxpenditure and Revenue Expenditure:.
Capital expenditure is either that incurred in the purchase
of fixed assets or that
which adds to the value of fixed
Examples
Examples of this form of expenditure are improvements
assets.
to buildings, the purchase of additiomal machinery,
c o st s incurred in the purchase of building and of
legal
course the
purchase price of the building.
Revenue expenditure is that which does (not add to the
of fixed assets, but merely the costs incurred in
.Examples
running the business during a particular period,
value
of revenue expenditure are repairs to building, maintenance
travel expenses etc.
charges,
5• Debtor:
A person who owes money to the institution.
6.
Creditor:
A person to whom money is owing by the institution
7 • Transact ion;
Any exchange of goods
money’s
or services for cash.
worth from one party to another,
of furniture
Transfer of
for eg. purchase
sale of goods etc.
8. Ent ry:
The record made in the books of accounts in respect ‘ of a
transaction.
.. 4 ..
4
9• Books of Accounts:
The collection of registers in which -ocording of
accounts
is done.
«
Debit and Credit:
When used as a noun, a debit is an entry on the left side
and a credit is an entry on the right side of
an ac c ount.
As an adjuctive, the debit side of
an account is the left
side and the credit side is the right side,
As a verb-, to
debit is to make an entry on the left side
and to credit
is to make an entry on the right side of
an ac c ount.
Debit indie ates
C redit indicates
Asset increase
Liability decrease
Capital decrease
Income decrease
Expense increase
Asset decrease
Liability increase
C ap it al inc re as e
Income increase
Expense' decrease
1 1 . Debit/Credit balance:
When the present status of an account
desired, it is
account is
is desired,
ascertained by adding all the debit items
items and writing their
total in small pencil figures below the last line used and
by doing the same for the credit items.
The difference
between the total debits and total credits,
which is called
the balance, is written below the tot- . of the larger side.
The balance is a debit balance when the debit side, is the
larger and a credit balance when the credit side is the
larger.
12.
Deprec iation:
A decrease in the value of a fixed asset due to passage of
time, wear and tear, obsolescence or inadequacy,,
5• Receipts and Payments:
Receipts are amounts actually received and payments are.
amounts actually paid, Receipt and payment accounts are a
summary of the cash book for the pericd.
4• Income and Expenditure:
Income is the revenue earned during a given period and
expenditure consists of those costs c <:r.s umed during the
period.
.. 5 ..
4*
5
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Accounts Receivable:
15.
Amounts collectible from clients for services rendered
on credit,
It could include amounts clearly committed
to the institution but are yet to be received from the
donors.
16. Acc ounts Payable :
Amounts payable to suppliers or contractors for the
acquisition of goods or
services on credit basis.
The concept of double entry book-keeping:
1.
Ac counting transaction;
A business/accounting transaction involves an exchange
of values.
It is the occurrence of an event or a condition
that is financial in nature and should be recorded in terms
of money -eg.purchases and sales of goods or services.
2. Every transaction affects
a minimum of two accounts ;
Every transaction has two aspects.
If an institution
has acquired an asset, it must have resulted in one of the
foilowing:
i) Some other asset has been given up
ii) The obligation to pay has arisen
iii) There has been a profit, leading to an increase in
the capital fund.
iv)
A donor has contributed money for the acquisition
of the asset 4
The reverse is also true,
If for instance, there is an
increase in the money owed to others,
there must have been
an increase in assets or a loss.
At any t ime:
Assets
= Liabilities 4- Capital or
Capital = Assets - Liabilities
A transaction must effect one of the three items
>C apital,
Assets or Liabilities.
•
-Du
Elements in every transaction;
In any transaction, the presence of the dual element is
evident; in the fact that on one hand a commodity, right
an-d on the other hand a commodity
right or service is given up.
An exchange takes place.
or service is received,
Thus one account receives benefit and another account parts
with benefit.
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6
Classific ation of Ac c ount s
Account means a statement setting out for
a period all
the transactions relating to a person,
,
a thing on any other
subjects,
the benefits received being on one side and the
benefits given being on the other.
Thus if a statement is
showing on one side the various
prepared for a customer,
credit
sales made to him and, on the other/ the various payments
received from him, thus showing the'amount still due from him,
the statement will be known as an. account.
Book'
is a good example of an account
clients account in the bank books.
Jhe 'Bank Pass-
it is a copy of the
Accounts are of various
types:
Accounts
Personal
impersonal
r
Real
Personal Accounts:
patients,
re 1 at e top e.rs ons - customers,
contractors or banks.
N omintil
supplie rs y
Beal Accounts relate to assets
Nominal Ac c o unts
relate to expenses, losses and income
Rules of double—entry
1• Personal Accounts
— Debit the receiver
Credit the giver
a-i Ac c o unt s
3• Nominal Accounts
Debit what comes in
Credit what goes out
Debit expenses and losses
Credit incomes end gains
The process of determining Debit and Credit
Step 1
Determine the two or more accounts affected
Step 2
Determine the type of accounts - Personal, Real
or Nominal
Step 3
Pind out which rules
are applicable to the &cco unt s
Step 4
Identify which account
is to be debited and which account
is to be^credited.
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The form of an Account
Debit
C redit
%
We
are debiting an account when we record a transaction
on the left side of an account.
We are crediting an account when we* record a transaction
on the right side of an account.
Aic c ount s may ,
1 .
also , be classified as fo11ows :
As set Ac c ount s
2. Liability Accounts
3. Expense Accounts
4-
Income Ac counts
5.
Capital Fund/other Eund Accounts
Rules of Debit & Credit(Alternate Method)
1 .
Increase in assets are debits; decreases are credits.
2. Increases in liabilities are credits;
3 • I nc r e as e s in capital fund are credits;
4. Increases in expenses are debits;
5 a■Incre ases
decreases are debits.
decreases are debits.
decreases are credits;
in revenues on incomes are credits; decreases
and
are
debits *
Asset.
Debit
Increase
(+)
Liability
C redit
De c re as e
(-)
Debit
De c re as e
(-)
C redit
Inc rease
(+)
Capital Fund/other Funds
Debit
De c re as e
(-)
Expense (Loss)
Debit
Inc x*e as e
(+)
Credit
Decrease
(-)
C redit
Incre ase
(+)
Revenue (P rofit)
Debit
Deere ase
(-)
Credit
Incre ase
(+)
. . 8
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Book-keeping cycles
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Examples of posting media
Types of journal
Charges of patients
. G-eiieral j ournal
Patients concessions and
adjustments
Special journal
bills
Payment vouchors
General
Led ge r
Casip. book
Suppliers invoices
Cash memos,
:
Patients fee jo.urnal
Cash receipts
I
Financial
Statements
_■
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Salary register.
Stores requisition
: Cheques
Petty cash slips
Stores^, re quest ions
i
Subsidiary Ledgers
Patients Accounts Receivable
Accounts payable
Building and Equipment
Inventory on stores
9
Books of Accounts
1 . Receipts cash book
2* Payments cash book
5* Purchase journal
4. Patients fees journal
5. Stores issue journal
6. Journal proper.
Ledgers
1• Main ledger
2. Patients accounts ledger
3- Stores ledger
4. Sundry advances ledger
5. Suppliers account ledger
6. Accounts receivable (other Inst itutions)
7* Project accounts/fund accounts ledger.
j/b.
•
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Cost Benefit Analysis for appraisa^^
The eppli'tation of Cost Benefit Analysis for the appraisal of
health programmes and projects can provide resales that help in
planning and resource allocation decisions.
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gvaluatinq Projects for Costs and Benefit.s
There are 3 steps in a detailed evaluation of projects
1* Measurement of costs
Costs include the cost of capital and operating coses. There may
be certain costs to the society
The costs are expressed m
market prices which need certain adjustments-to refl££t real costs.
Taxes, fees, duties etc., need to be excluded from costs.
2. Measurement of Benefits
There are direct as well as indirect benefits and many of them
cannot easily be put in monetary terms as ' they.rare non-marketable
public goods and have no price equivalence. The benefits are to
be calculated in terms of increase in income due to tte change
in th'e "situation.
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3. Comparing costs and benefits
There are three methods for comparing the costs and benefits.
(a) Net present value (b) Internal rate of return (c) Pay back peri
In net present value, projects with higher net present value are
preferred. In payback period projects with lower .periods are
preferred. In internal rate of return, projects with higher
internal rate of return are preferred.
Jj a cost benefit analysis of a
For practice, let us try to do
The
Malaria eradication project. T’ following methodology can be adopted
for this purpose:
i) identification of consequences/outcomes.
ii) quantification of the same; and
iii) conversion of the quantified outcomes into monetary terms.
The sum of the above would give the gross c&sts of the disease
’with' and 'without' the project. The difference between the two woul
provide an estimate of monetary benefi^s/losses as a result of efrort• to control/eradicate Malaria. The principle involved in sue .a2
approach is that the total cost of the disease (or part of
as a measure of benefits derived from its eradication or the reducti-.
in costs through partial control.
Outcomes of frh?
The large scale prevalence of Malaria has, a number of social,
economic end demographic consequences arising out of the disease
specific morbidity and mortality. While.some of these consequences
lead to direct monetary costs to the society, some others cost the
society in an indirect way.
The important components of such direct costs are:
i) treatment costs of malaria in outpatient and inpatient facilivie.
of health institutions.
ii) treatment costs incurred by families as personal medical care
expenses.
iii) monetary costs to the sick for transportati n to the place of
treatment and back.
Ii
iv) monetary costs to the families for providing much needed supple
mentary or special foods to reduce/preveht debilitating effects
of malaria.
, ;■;, . t.Vj.V/V-. 'V —. _ _ . ..... •— —
Cartain important indirect Consequences of malaria to the society are:
i) the productivity losses due to temporary absence from work. •
ii) the present -monetary value of. future earnings lost due to premature mortality directly ascribable to malaria.
iii) the benefits foregone on the increased monetary expenditures
that the society would have to incur to feed the additions to the
population (increased fertility) caused by reduced mortality
as a consequence of control and eradication measures.
Estimating monetary benefits/losses
>.r'; V
if : ■
V-
= cost to society if programme was not launched
y = investment in programme
wz = cost to society ’with' the programme'
Saving in ao.sps to society = (x-z)
X
An investment of. 'y'has resulted in a benefit of (x-z)
(x-z),9 ■ giving a
benefit cost ratio of Rs.(.x-z) ‘per one rupee of investment .
y ■
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Benefit Cost Analysi.a
Objective
* To
estimate the cost benefits resulting from a development
input viz.
minor irrigation tank project
Problem
In a backward area, a model development project of constructing an
!
irrigation project is considered. Estimate if the project is
worthwhile.
1 • Expenditure Estimates
'1. Minor irrigation scheme
Khariff - 1000
Rabi
2
-
Rs. 59 • 7 lakhs ,
Ha
500 Ha
Lift irrigation schemes (2 Nos.) Rs.22.5 lakhs
2 crops - 100 Ha = 200"Ha
Rs.2t<;ff.mtoiDbs
3. Land^development
4. Agacut Roads
~ •■'
5.
Central Marketing complex
Silk
■
Rs. 052001 Akfchs
(Mulbery)
:,ft
Rs. 0.25 lakhs
& demonstrate
Rs. Qji30 lakhs
farm for sericulture
Q
c !Jhl
■H'X
'Rs.Rsl15.52 lakhs
A
2. Benefits
(a)
'i i •
Before taking up project
1.
Area proposed to be irrigated
2.
Area
3. .Crops
4.
1276 rHa
expected to be submerged
d: 276
Ha
Jowar (Local)
grown in 1000 acres now
Yield per Ha nowr
652 Kg.
5. Price per 100 Kg Jowar
Rs.lgp
6. Cost of cultivation per Ha
Rs.280.3 5 '
?•
Value of fodder per Ha
Rs.107.82
8#
Value of Jowar per Ha
5. Value of fodder
1O«
Gross value of output in 1276
HA
11• Net value of output
Note:
2.5 acres = 1
Ha
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(b) After Irrigation
1. Area
2. Area
3. Area
expectedto be brought under minor irrigation
1.0 00 H a
expectedto be brought under lift irrigation
expectedto be irrigated in Khariff
■200 Ha
4. Area
expectedto be irrigated in Rabi/
5. Crops expected to be grown are
•*
1200 Ha
:,0i
700 -Wa
'^'70
.... - V.'S-/
/y .
./
’ • -
Jowar (HYU)
J 1000 Ha;'
Groundnut
Mulbery .
• 000 Ha
100 Ha
6. Yield of Jowar (HYU) per Ha
Groundnut per Ha
Mulbery per Ha
7. Price of Jowar (HYU)/1OO K^^zj
3® F
■14B2 Kg •/
'■ '* " d<.:
Rs.100
Groundnut/lDQKa
Groundnut/IOQ.
; ,7,.
Silk wo rms/10 0 K g'
8< Fodder value: Jo war per Ha
•0
<
g-
. . .
'
c
, Rs. 200' ’
Rs .'2 500.
Rs.107.00
Groundout per Ha
Mulbery per
■'
Rs* 20.'.00
Rs. 10.00
" *.605.15
Cost of cultivation-. Jowa£- per .H^x
.
Grouhdnu-t. per “Ha
Silk worms pef“Ha
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fe.74C.00
Rs. 7000. 00'
10. Value of Jowar. ? ..
Groundnut
• -
'
'VV
Silk ..worm
3* Net Benefits ' - ? . .....
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1. Total gross value before project
^Cj
2« Total costs •af'Ler project
<7- ,
3. Net value after project
4. Net value after project - Net val/ue befdie ;prpject = Net benefit
* 2.bJ1. Net Value Jowar
Groundnut
T;.
Silk Wo'rti
’ K:. ■
•A’.
- •
4?
: 3 :
Cost Benefit
(1)
How many years does it take
(2)
Calculate the rate of return when life of project is
40 years (Rate of
(a)
to pay back the cost of project
interest for life of the project)
Cash flow
0
1
2
30 30
3
4
5
6
30 30
(Rs.115^52 lakhs)
40
30
Fund Flow gnd Cash Flow Statements
Fund Flow Statement
There are two major types of information that the accounts or
a
organisation are intended to provide. They are, one a oerioHic
Of the Pro™>t°rs Stake in the company and two, a measure of
o ca nings and what has been done with these. Apart from these
«certain subsidi^y statements arf to be considered
Thev
the’fudri
s'tatement» the Directors report, the Auditors report
the fund flow statement, and various supplementary statistical tables ’
In this section, the fund flow statement
and its analysis is
dis cussed.
ent
loans, grants and
Using this information! UJ to noia a as
both managemen: and
external parties can make decisions and plan for the
—1 future a nd a n a j. y s e
the trend of the use of funds.
..
cash or its substitute.
Eg: Balance. .Sheet
Liabilities
as .of 3.1st Match.. 1978
’000
1986
Assets
1287
Lon(L.term liabilities
Debentures
1000
Curren t li a bi1i ti e s
Creditor s
550
Provisior for tax
350
Bank overdraft
50
Sha.reholders funds
Shares
500
Reserves
1050
Profits for distbp.
50
500
1100
60
3580
4110
1000
850
250
350
Fixed Assets
Land
Vehicle s
Current Assets
Stock
Debt ors
Cash
’ 000 '
1986
1987
800
1700
800
1900
340
650
60
400
1000
10
3580
4110
Cash Flow Statements
Cash flows are the inflows and outflows of cash of an oraam s-- i-i n-.'
Cash flows a.~?
are prepared on a historical and/or projected basis. Wh^n
it is projected
it is nothing but a cash budaet
It
inflows, and cash outflows for an ensuing, period’usuall^ cut un A-.
sub
periods
sdur!P¥®
P^j^tioJs^a SSi^s^Jould^lan^SdiU^-^313*
as ai«
f111 projectd short
xuA taSu £low statement on historical basis is simolv summary
heads6 CIthth2sksho 3 business> ,al1
ems being classifieda into
ru ad
neaas. it thus.shows sources arti uses of cash durina a oeriod
For
management, projected cash flow statement is an instrument of'ii-- '4 ■'
Mnagema.i, while a historical cash flow stat“ert p^oriSes the i; I-,
f°$ SS future^
p0rf0I“"c!! 1" *M. area and for drawing less-.-n's'"
Model of a ..C a s h F1 o w S t a tern ent
Item
..7 • •
Jan
Feb. Mar. Apr. May. .
1 • Cash in hand
Receip.Qs
2. Cash sales
3. Debtors
4. Capital Receipts
5. Others
Payments
6. Cash purchases
7. Creditors
U • -Fixed assets
9. Expenses
10. Others
11. Surplus/Deficit
12. Bank borrowing/Deposits
t
13. Cash in hand (closing)
------------ITIIMII ■--------
.
.
-
_
_____
!-'■
■
■?
l • ;
o
.. u Dec.
Financial Analysis and Control
Information produced by the accounting system is useful only if it
is used. The persons who may need information are:
1• Managements
2. Donors
3. Creditors
4. Financiers
5. Customers
6. Workers
With the financial statements two types of analysis are available:
1. Trend analysis - comparison of previous period
2. Interfirm comparison - Comparison with similar organisation.
For analysis there are 3 main types of ratios:
1• Investment ratios
2. Liquidity ratios
3. Efficiency ratios
Investment ratios deal with long term objectives of survival growth
and providing <an acceptable
‘
‘ ratio of return to its investment
a. Return on equity ratio:
Net profit after tax
Shareholder funds
Gearing ratio
Long term borrowing
Net assets employed
Liquidity ratios show the way the company is meeting the s hort term
objective of being able to generate sufficient cash to pay its bills
on time.
Current ratio
Current assets
Current liabilities
Acid test ratio
Liquid assets
Current liabilities
Efficiency ratios provide information on the use of assets,
how effectively managers us:limlted resources
Primary Efficiency
ratio
It says
Profit before tax and interest
Net assets employed
Makeup ratio
Asset turn over ratio
Profit before tax and interest
Sales
Sales
Net assets employed
RUHS A DEPARTMENT OF CMC&Ht VELLORE
Legal Regulations in India
Notes Issued by Thomas P.Benjamin
Legal regulations with respect to finance pertains to the
duties and responsibilities of the organization to the government,
its promoters and donors.
The donors are to be kept informed
with audited statement of accounts.
The promoters need to be
informed with statements and progress passing their accountability
with respect to resources made available to the managers of the
project.
In this section, we will be dealing mainly with
legal matters related to the responsibilities of the organization
to the government.
THE ORGANIZATION
The organization has to be registered under the Trust,
Association, Society or Company.
More details may be obtained
from, R.Shankaran and Ivo Rodrigues , A hand book to the
Management of Voluntary Organizat ions, Alpha Publishers, Madras,
1983.
THE INCOME TAX ACT
It is necessary for the organizations to comply with
provisions of the Income Tax Act. as applicable to charitable
institutions, otherwise the funds received may be liable to
heavy tax.
A charitable institution can claim income tax exemption
from property held in India under the following conditions.
(1)
The property from which income is derived should be held
under a trust or other legal obligations.
(2)
The property should be held for charitable or religions
purpose®
(3)
The trust should not be created for any particular religious
community or caste.
(4)
No part of the income should ensure directly or indirectly
the benefit to the sittier or other specified persons.
The exemption is confined to only such portion of the trusts
income.
(1)
Which is applied to charitable or religious purposes in India
or for international purposes outside India.
(2)
Or is accumulated within the permissable limits for
application to such purposes.
However, such organizations should not carry on any business
except for
(1)'
Wholly for public religious purposes
z•
2 ::
(2) Or the business is carried on by an institution wholly
for charitable purposes and the ._wQrk_. in, connect ion with
the business is mainly carried on- by. the.. benefic iaries
of the institution.
Seperate books are to be maintained by the trust or institution
iri. respect of such business,
It is not enough that the organization is registered under its
respective acts.
It is necessary that the organization should
also be registered for income tax exemption anj this registration
should be done within a year (or specified period)
of the
creation of the organization.
WHO IS ELIGIBLE FOR TAX EXEMPTION
1.
In order to be eligible for tax exemption,’ a charitable trust
or institution is required to apply at least 75^ of its
income for charitable or religious purposes.
2.
The organization may have the option to spend the income
in subsequent year under special conditions if it has not
been able to spend the 75%.
However, the application during:
the extended period has to be as per the rules for application
of funds for tax exemption.
ACCUMULATION OF INCOME:
As a corolary the income may be accumulated for future application
as per rules of application of funds.
The money set apart in
such manner will not be calculated as the years income.
It is
necessary to keep the income tax officer, informed in the
prescribed form.
Investment of unspent funds of charitable organization,
The
guide lines for investment of unspent money is
1 .
Government savings certificate
2.
Post office savings bank account
3.
4.
5.
Scheduled bank or co-operative bank including land mortgage.
Unit trust of India
Investment in any security for money created or issued by the
central Government, or a State Government,
6.
Investments in debentures of any corparte
7.
Deposit in Government company
8.
Bonds issued by financial corporate
9.
Bonds issued by public company for financing housing
10. Investment in immovable property
11. Deposits in Industrial Development.
.. 3 ..
t
3
AUDIT
When total income exceeds Rs.25,000/- in any accounting year,
its accounts are required to be audited.
FILING RBTURN OF INCOME
Every charitable organization is required to file a return of
.income in the prescribed form;
Income not eligiblefor exemption.
1 .
Income from property which does not ensure the benefit of
the public
2.
Income of charitable institution created for the benefit of
any particular religious community or caste.
3.
Income of institution that may benefit any one individual.
4.
Income of institution which may benefit the owner of the
instituti on.
SECTION 80 GDeduction is allowed to donors under section 80 G- of income tax
act.
When donations above Rs.250^- are made to charitable insti
tutions registered with the officer for deduction.
SECTION 35 CC
A company or coperative society is entitled to deduction in
respect of any expenditure incured by them during the previous
year on Rural Development Programmes,
Income which do not form part
of Total Income
1 .
Income of Educational institutions
2.
Income of a hospital or medical institution which is for
philanthropic purposes.
3.
Income of public charitable trust or society for Development
of Khadi and village industries.
Foreign Exchange Regulation Act
1 . This rul-
is applicable to all citizens of India within or
outside India.
2.
The act restricts the payment or receipt of foreign funds
other than through an authorised foreign exchange dealer.
3.
Other restrictions exist on similar grounds for gold or
jewellery.
Also no property can be transferal.
Foreign Contribution Act, 1978
1 .
The purpose is to regulate, acceptance and utilization of
specified foreign contribution, foreign hospitality or
scholarship so as to ensure that amongst others voluntary
organizations and individuals working in this important
areas of national life may function in a manner consistent
with the values of a sovereign democratic republic.
. . 4
4
2,
It is applicable to all Indians inside or outside India
and all associations. —
5.
4.
- ;
The amount of contribution is Rs.1000/~ or .above.
Persons not eligible for foreign contribution are judges,
candidates for election, journalists., MLA1 s political parties.
5,
Restrictions and regulations exist for scholarship and
stipends *
6.
Foreign hospitality for judges, MLAs political party
officers and government servants have to get prior permission.
■ ?
/
?•
>■
j/b.
V
INCOME AND EXPENDITURE ACCOUNT
The above statement is the income and expenditure account
of RUHSA for the year ended 50th June 1980.
This account is
prepared for comparing the incomes' and expenditure of the period
1/7/79 to 30/6/so.
The following points have to be kept in
mind while preparing this account:
1 .
No capital item should be entered in this account.
In other
words, only,revenue items must be entered in this account.
2.
No item, either revenue or expenditure, relating to the past
period of future period will be entered in this account.
ome and expenditure account, no
In the above income
no item for the
year ended 50#6^79 or 50.6*81 will be entered.
?. L
..Vi . ■
3.
If any expense incurred during the year 1.7.79 to 50.6.80
remains unp aid > it must be brought into the account like
an outstanding expense.
4.
In the same manner,
if some income that has been earned
has not yet been actually received, it should be brought
into the account*
On the right hand side of the above statement, the income
for the year ended 50.6,80 received from various
sources has
been recorded.
This includes amounts actually received and
receivable pertaining to the period.
The stock on hand as on
20.6,80 is also included on the income side.
On the left hand size are listed the various expenses
incurred during the year,
The stock as on 1.7.79 is also
included in the expenditure side.
The expenditure for the year exceeds the^ income received
and this is indicated on the right side of the statement as
’Excess of income over expenditure’.
A comparison of similar incomes and expenditures for the
year ended 50.6.79- will help us to analyse the causes for
variation if any.
Balance Sheet
The above statement is the balance sheet of RUHSA as at
50th June 1980.
The balance sheet portrays the finaneial
position as on the last day of the year to which the final accounts
relate.
The righthand side shows the various assets that the
•. 2 ••
•• 1.
■
• .H
ri
■ 2- -
institution possesses, s ep ar at e ly f or fixed assets.-, investments
and current assets along with the necessary details.
hand side is ^called the liabilities side.
The left
It shows the amounts
due to outsiders, amounts that are due for payment
.created and amounts invested in*the institution.
reserves
Looked at
from the point of view of assets, the balance sheet shows the
amount of assets possessed by the institution and the manner
••ixi which the necessary funds were raised.
The liabilities side
shows . the tot al of the funds placed at the disposal of the manage
mentthe asset side shows how these funds were utilised.
■
< JC
■ -r?
-
■*...
t
■
■.!
1
. . j
$
j/b.
CBRIMUl MHHDAI. CCUS6B, BBOOHI AaSOCUTIOL
■
4
Busal.Unit for Health aaft Social Affairs, I.t.Puraa, Kmnur P.O.
XpcogB
50-6-79
Zx^eadlturc
I
^°r t*W TW «n4jd y>Ml
gypgqdJlfruy
50-6-79
fcapS
InooM
7,97,480-79
Hy Qrap'. s fteqelyed
Bxtsmal agencies
Internal agenoiea
*.?•
I
i
I
I
Ad uiniujtr at Ion
75,567-95
38,505-92
1I
Molctonanoe
28,822-2)
«
Staff and cocunmlty welfare
94,414-50
I»
13,834-31
1,78,839-50
’
3,25,373-20
43,162-98
to opening stock
1
1
1
i
Fam and Agrinolturc-
1I
89,246-30
1
1
Social Dcvclopaent
27,872-63
9,385-09
36,919-40 J
51,590-28 i •
Consultancy, Training and Svainar
Socio Beonesic Survey
CEHT Unit
f
13,233-29
aI
1
32,387-00
87,687-62
I
i
11
1 <",66,232,92
Public Pelationi
Depreciation
2xcuS->
t^cci»3 over
expenditure - b^in^ balance of
unspent grants transferred
to Point an su*ce Fund.
I
!
6,745-00
Socio Be anode Unit
24,233-91
1,96,773-06./
10,987-99
JHaodlaneoua Xboom
26,174-54
8,029-30
Consultation, traiala< and
Soinar
Para and Agriculture
10/96-15
34,639-31
1,38,252—89
I
II
!
1
M
43,162-98
26,OO7-O1^X
1,61,705-00^
I
66,^2-92
117,07,687-34
I
1
%
■/
Bxoeae of. Expenditure
over Isoom
I
i
T
-
-
- -
-
•
-^4
-7 '
.i
39,161-34
12,345-50
53,572-14
15,512-28
1-’^
•?Cr-
11,370-72
17,07,687-34
>
•
- >.
2,304-55
1,01,591-26
1
I 1.
I
I
40,586-27 ‘i
ClogihB Stocfr
Drugs - Stores
Drugs - Dispensing
area
General Stores
Socio EcoDoai'*' Unit
»
I
I
I
I
t
12,20,173-84^
2,36,026-79 »
4,211-35
72,307-29
1
1
11,02,356-84
1,18,115-00
1,67,204-40/
1,82,687-©T^
4,68,259-74
Medical Servicea
*• >•
Medical Servioes
Interest on fndowesat
Fund
Donation fxua indiTiduals
t
Socio Bconoaic Uu54.
1,73,513-08
22,102-43
19,028-95
Transport
1
1
1
1
1
1
1,23.051-85
IfrQOf
SHiHKAfi * TEBWMK •
Chartered JOcooBtcuts
Jengalore
16th Septsaber 7980.
• ' CTBUWI1W ’TDICAl CTlHWi mWKB iS80CWt«.
feA titoil for Hw'.1
Social tffalr,.
twwr 7^
• j !"
Balance
1 •. \
9
1979-60
-^asxxitieB.
fe.ps
1I---------------
3,04,241-46
39.074-82
3,973-72
..
te.p*
jOrants received in advance
J Central Bank of India A/c
1 overdrawn
1
1
1
| Endowment Funds
3,97,182-75
III
I»
1.00,000-00
J
year.
\.
15,55,335-92 J
P3_ant Capital
1,17,916-^
5,57.572-22
1
1
1
l
Stock on hand
Advances and deposits
•J 4,695-50[
Income Receivable
h
8
I
I
•i
I«
s 3,p7.182-75
1
- ■
o,4l ,182-75
20,098-72
0
I
H
II
I
IR
jl,16,440-00 |
!
I
1
Capital Fund overspent
Capital Stores
1
»
Capital vorfc in •progress
I
r-dovsent Fund Investa
TEA Fund
Farmers >s*»rgency Fund
Easily Care workers Fund
I
2,. 1.906-66
70.557-00
8,27} 04
6,97,182-75
1 .00,000-X)
1.44,000-00
9,41,182-75
I'■I
11,61,705-00 J
96,572-17
20.000-^0
R
a
1,44,000-00
1.01,591-26
•
!
Parsers Emergency Fund
Family Care Workers Fund
J Depreciation Fund
1,16,440-00 i (honing Balance
| Add: Depreciation for the
'.68,630-46
1
6,97,182-75
Capital Fund
l43,162-98i
(43,281-861
I
1n
N
i
i
i
I
1,00.000-00
Remittance in trauit to CTC
95,442-98’
743-01
1f—
1,04,041-71
1
s
10^66,600-^!
2^0.368-24
Depoalt rlth CWSH
{
i
i
i
i
2,750-00
2,06,791-r
Programme Director*s Discretionary
I
Fund.
7,90,1’r'-93 I
Caah at Bank
Fixed Deposit
1
<,43,194-48
TEA Fund
1
Cash on hand (I«pr*e-t)
1,650-00
2 ,10,315-45
I
r
1
>e
te.p«
4
isel
1 Sundry Creditors for expensed
| Accounts payable - LEPRA
1979-60
Ca<h 4 Bank, Balances:
1
I
A ■ • • t a.
^30-6-79
j
b.pa
kaintenance Fund
3,04,241-46
fopening Balance
{Less: Excess of expenditure
11,370-72
i
over income
fceas : PF administration charg' s,
1
death benefit contri
l
bution and Death benefl'
administration charges
J
relating to 1977-78 and|
r
1
2,502-50
1978-79.
I
1
I
3,1 1,282-15
te-
1
1
1
1
,78,145-00
1
2",70,869-23
51,13,236-89
32,97,667-75 |
13,3|,335-92 j Fixed Aseets
"32^,^67-75 I
II
I
27,70,869-23
51,13,236-89
-u
- --------- V
t
*B R
<
:0rdance tharenth, read with the noie thereon.
Checks* with the bo<A.s pressed mid found correct in
■j ■
IB
!!
a noKATFsa
Chartered Accounts
Bangalore - 16th Beptr.1980.
*
’'"7 ■•’•
J
.................... ’•<'
I
. .< i- - ? -■ .
QUALITY CIRCLE
AT A GLANCE
T
HINDUSTAN AERONAUTICS LIMITED
BANGALORE COMPLEX
BANGALORE-560 017
.
'■
-•
■■.•
•
■
r
What is a Quality Circle?
..
:
ii ■
7 • '
E
■
£■
!■
A group of people who meet volunt
arily together on a regular basis to
identify, analyse, and solve quality,
productivity, cost reduction,
tsafety
and other problems in their work; area.
leading to improvement in their work
environment and performance leading
to enrichment to their work life.
2
3
■■
J.
I
Where do l
Ideally, members of a particular Circle
should
be from the
same
work
centre, or who do similar work, so that
the problems they select will
be
familiar to all of them.
?
■
mbers come from ?
Increase employee motivation.
Create problem-solving capability.
■
tews
ft
.
.
■
.
Build an attitude of "Defect Pre
vention.
How many members are in a Circle ?
An Ideal size is eight to ten members.
The size of Circles can vary from a low
of five members to a high of about
fifteen. The size must never be so
great that each and every member can
not have sufficient time to participate
and contribute at each meeting. Too
few members would also tend to make
circles dormant.
Improve
Division.
Communication
Promote personal
development.
and
in
the
leadership
I
Develop a greater Quality aware
ness.
Objective of Quality Circles
Promote cost reduction.
Reduce errors and enhance quality
and productivity.
Inspire more effective team work.
Catalyse attitudinal changes for
greater cohesiveness and team
work.
4
5
■
•*/
■
''
-
. . • £I
kc -
Why the emphasis on Quality ?
■.
’
'
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.
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■
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A
..
1^: ' '.
.7
J
. ’v
V
& AiJ
O//
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a-
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J ■
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r.’
pili
‘
^REPeAT
• -M
W
A
■■■'
What typ* of Organisations can use it ?
Many of the problems In a production
line are related to Quality-doing jobs
right first time and every time is the
requirement of quality in production.
This will lead to reduced levels of nonconformance/scrap which will result
in higher productivity. Majority of the
quality problems can be solved by the
operational management (i. e. Middle
and
Senior level) and
employees
Better Quality will lead to better flow
of work in progress and better relation
ship between departments. It will also
result in increased customer's satis
faction.
.
xTn
r
6
■.
7
.. •.
3:.V/'' . 3j
'4g -
■ . .-'.ig
W'-
'<■
:4;''3z
•
■■
I’
Every organise non offering goods or
services needs Quality Circles to in
volve its people in quality conscious
ness. Every business, every industry
and every organisation, regardless of
its product or purpose can benefit
greatly from the participation of all its
people. Quality Circles are now used
in such diverse industries as Engi
neering
industries.
Merchandising,
Hospitals, Canteen, Banking, Insurance
and many more.
'
■W
g - ■ /
IM
■
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■
-
Organized ?
33
A
h l^
h1
8
■'
:■'
■;
31 ?gI
/storing'
COMMITS
Ml-
CD
» \ ■n
tn \
-
- they were not meeting regularly
every week, as quality circles are
intended to.
- in quality control circles though
the employees participate, the
approach is of quality task force
to solve the problem. Where as,
in quality circles the employees
are given adequate training so
that they will be capable of re
commending and implementing
solutions to problems affecting
their work, by using the tech
niques of quality management.
' • '
■' w
■J
Is this a new idea ?
No. The Quality Circle concept was
developed in the early 198Os in Japan.
In
some of the Divisions of HAL,
Quality Circles have already been in
vogue from 1970. Though in these
divisions they were called Quality
Control Circles, they differ from con
cept of the quality circle in the follo
wing manner.
fe
How is the Quality Circle Programme
■
■ :
A Quality Circle Programme is an inte
grated system made up of several
parts :
The members themselves.
9
■
■...
Deputy Leaders — Group E
and below
Circle Leaders — Group 'E' and
Grade .|/i|
Fa cilita tors
Grade Ill/IV/V
(Co-ondinator)
Steering
General Manc-.qer
Com m i 11 e n
end other
Senior Officers
How does the process work ?
The following are the steps involved :
pa..
/
■
PROBLEM
IDENTIFICATION
How many circles in a given area ?
In a department for example wh^re ^5
individuals do identical fobs, how'arc
the 7 or 8 persons selected for the
Circle? No scdortion is made. Nor is
Circle membership roiatf-d. If all 25
want to be Circle members, then 2 or 3
circles are formed. Experience .shows
that the three Circles in this instance
would
not duplicate each other's
activities.
Each will contribute
jp
its own way and that contribution will
benefit the other circles, too.
PROBLEM
SELECTION
/
hi
r
PROBLEM
ANALYSIS
How long do circle meetings usually last
and how often are they held ?
Experience has shown tha* tor
for purposes of continuity and effectiveness it is
advisable to hold rneetinn atl^ast once
m a week or once in a fortnight. Each
one hourUSUallV lastsfor approximately
10
-
IMPLEMENTATION AND
RECOMMENDATION
TO MANAGEMENT
1 1
r
ji ■
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■
■
.
•
..
Typically, s«
ral problems will be
identified in « work centre and one
problem is selected by the Quality
Circle. After solving the problem next
problem is taken up. Problem identifi
cation and selection is carried out by
any one or more of the following
- Circle Members,
- Facilitators,
- Personnel from technical depart
ments,
- Management.
.'■■■■■I
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■
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How should a circle approach problems?
i i
Problem analysis is performed by the
circle with the assistance, if needed
from the appropriate specialists from
technical departments.
.
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meeting ?
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Done It
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What takes place during a circle
■./
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Circle Members should approach the
problem with a positive attitude In
stead of having a tendency to shrug off
problems. Open discussion and brain
storming with every one participating
and a positive and co-operative manner
will shed new light on any problem.
Due to the knowledge and training
LTPart0d ’n application of Quality
Management
techniques,
circles
should approach the problem with a
confidence that they can find definite
solutions.
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Any of several activities may occur
during meeting such as
- Identifying a problem to work on
- Dissemination of knowledge and
training as required to better en
able Circle members to analyse
problems.
* Analysing problems.
- Preparing recommendations for
implementing solution.
- Participation in presentations to
management.
- Feed back to circle members.
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12
13
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How important
is
it for a
circ.
to
What if a circle project overlaps into
establish objectives and milestones?
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other departments?
■
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ACTION ITEMS
Item
Action
Who
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How does the circle use the services
of specialists?
I
WE WANT '/oo
NOW HOW To
SOLVEIT^ ,
To HELP us
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p
o
Very important I Circles are encouraged
to establish an objective and develop
a plan to achieve it. The plan is further
broken into milestones so that pro
gress can be constantly measured
against the plan.
ii
ifi
14
15
■4
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I
Date
Target | Actual
••
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This should be avoided. Usually, there
are plenty of problems In a Circle's own
area.
However, If an overlap does
occur, an effort should be made to
work with the Circle in the affected area.
Also,
management of
all
depart
ments involved should be kept advised
of Circle activities.
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.
Although a C». -ie is largely a 'do-ityour-selfer', it is frequently necessary
for it to contact the organisation's
experts in given fields, such as quality,
design, production engineering, safety,
maintenance, purchase etc. This co
mmunication is strongly encouraged,
and the invitations to attend Circle mee
tings and offer advice and consultation
should be made through the normal
channels. The specialists thus called
upon serve as consultants, while the
Circle retains responsibility for solving
the problems.
■.
,
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I
. undamentally, the Steering Committee
must set goals and objectives for the
Quality Circle activities which estab
lishes operational guidelines and takes
an overview of the Quality Circle acti
vities. It I*' presided ovp by a Chair,
man who is preferably the General Ma
nager of the Division.
••
What is the steering committee ?
Deputy General Manager and Senior
Managers
from major departments
within the organisation are usually
members of the Steering Committee.
Facilitators are invited to the steering
committee, for giving brief reports on
the functioning of the Circles in their
respective area.
'■i ■
Who is a facilitator ?
!
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The facilitator is a Sr. Manager nomi
nated by the management responsible
for co-ordinating and guiding Quality
Circle activities in his individual areas.
Who is the leader?
Experience demonstrates that Circle
activities v 'll have a greater chance of
1 7
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Who are usually on the steering
committee ?
...
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success when the supervisor
the
initial leader. The Quality Circle con
cept gains quicker acceptance when it
fits into the existing organisational
structure. The supervisor is already
designated to perform a leadership role
In the structure. However, the choice
of Leader and Dy. Leader is left entirely
to the members of the Quality Circles.
-- 'T
TO
■'
■■■.■
.
.
Non-conformance to the requirement,
repetitive snags/defects, work environments/facilities, paperwork, comm.
unlcntions, are few
f
of the general cate
gories of problems taken by Quality
Circles.
Virtually,
anything
which
affects the quality of the work may be
seiected as a project by the Quality
circles.
be the leader ?
,
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Is there a
relationship
between
©IMS
-
Does a circle ever run out of problems ?
Of course! It will probably evolve in the
following manner: The supervisor be
comes the first Circle Leader, another
member a Dy. Leader. Subsequently, if
the members so decide,any othermember with the necessary competence
can also be chosen as the Leader or
Dy. Leader.
I HOPE
WE H/VE CLEARED
ALL TIE PWEM5
AW W WE WILl
UWE ANOTHER WMN SJbRMING
SESSION WE WILL
Discover more s/
o.
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the
circle and the work ?
■■
The members of a Circle are people
who normally work together. The pro
jects they select to work on always
relate to the work they do.
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18
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What are the general problem areas
selected by quality circles ?
Can any one other than the Supervisor
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attitudes about quality circles?
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Opinion surveys taken among Leaders
and members consistently result In
unanimous or near unanimous agree*
ment that:
i
Is “problem prevention” an appropriate
•
•
No! The members may occasionally
think so; but a brainstorming session
usually surfaces many problems that
need immediate attention.
-
•
■
•
:
I
Quality has been improved.
theme?
It is most appropriate and should be
enthusiastically encouraged. When a
Circle has passed the point of "putting
out fires" and starts looking ahead for
ways
of preventing them,
it has
achieved a major milestone. This is a
form of quality consciousness that
insures that quality will be built into
the product and not ''inspected in".
Morale has been enhanced.
Quality Circles are cost effective.
I
Attitudinal changes and better team
work have taken place.
Circles activities should be con
tinued and extended to others.
"•
■
What is the management presentation T
Are safety themes acceptable ?
t
Absolutely! Most safety themes also
have a relationship to quality and pro
ductivity.
...
■
.
■
implement?
Experience has shown that majority
of the Circles recommendations either
cost nothing to implement them or
usually are of low value which can be
financed from normal divisional budget*
Majority of circle recommendations can
normally be implemented by the circle
members themselves.
21
20
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OFCjOUW WC ME
z Solved THAT
PRpBLEM
Don’t circle suggestions get costly to
e •
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A Management Presentation is where
the leader and members describe to
their manager what project they have
been working on and what recommen
dations they wish to make concerning
It. Participants use slides/data that
they have prepared. This event rep
resents a most exciting form of parti
cipation, communication and recog
nition for all.
Why
are management
i
.
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11.
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Is rncpnim
The Leadei j and Dy. Leaders are pre
ferably trained centrally on all aspects
of
QC
operations.
Thereafter the
Leader trains the members during a part
of each meeting. I his member training
takes place 'v''; a period of several
weeks. Thereafter, additional training
is
provided
as
required,
or as a
refresher.
■
presentation
A Presentation is made to :
Show completed projects
Make recommendations
Provide status on long term projects
To highlight improvements effected
22
23
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What training is provided and when ?
made ?
.3 :
(.-i i).! i u •; n r i' * n ■;
weeks and « -‘leriecJ cases presented
to the top mr?na<jpment once in 3-4
months. It has I .qp
shown that such
f»orjrammos apart from other benefits
r esult in great r-r in vol ve me nt of middle/
top lev-'l e 'i>c. uti ves in the activities of
Quality Circles.
presentations
Management Presentations
promote
communication. Managers are perso
nally informed of the Circles' activities
and accomplishments.
The Circles
gain recognition for their contributions.
Morale is bolstered by the periodic
opportunities to deal directly with the
managers and to be reassured of supp
ort for their activities.
When is a management
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important ?
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.
the management presentation ?
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What is the recommended frequency of
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What are the quality circle techniques?
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MECTTNG
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fel
Problem identification
This is carried out based on day-to-day
problem s encountered in the work
centre. This can also be arrived at by
using the technique of brain storming.
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■.
To solve the problems, data must be
collected. Way to do this on a samp
ling basis are explained in one of the
classes.
Sampling permits It to be
done in a way that saves time and
effort. A variety of forms can be used
to ease and speed the collection of
data.
q
■'
■
Data collection
V; •
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The most common techniques are:
'
- Data collection
f
i
- Pareto analysis
h
- Cause and effect analysis
■
■
- Problem prevention
- Presentation techniques.
24
■
I K
I R;-.
J
This technique is not only a lot of fun,
it is an excellent way to totally Involve
everybody.
Brainstorming
helps to
bring out the Imaginative and creative
solutions that every organisation needs
in order to remain healthy and competi
tive.
- Brain storming
25
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Brain storming
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- Problem identification
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Pareto analysis
What’s in it for you ?
Decisions must be made with data
that Is collected. The Pareto chart aids
In doing this In an organised way. This
chart is commonly used in management
presentations because of its ease of
understanding and visual impact.
Cause & Effect analysis
This is the number one favourite te
chnique that is employed. It is fun.
It is very participative. Best of all it
really works. Members do not simply
identify problems for others to solve
but also resolve them and implement
solutions.
Problem prevention
The entire training emphasizes that the
best way to control problems is to
avoid them. Quality is 'built-in' by those
who do the work.
K.C.. ‘
The management presentation
KB..- ••
Members leern how to communicate
their recommendations to management
in a most powerful way.
Some of the
answers to this question
are:
BO--''
0
I
- The r
----opportunity
to identify the
problems you have been living
with and no one seems to care
about.
- Being recognized as the "expert'*
In your area.
- Being allowed to select
the problems to be analyzed.
- Having the chance to actually ana
lyse the selected problems.
opportunity to
present re
commended problem solution's
directly to management.
- The
i a a,. >; ,a
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- The chance to contribute to enhancing the
organization’s quality reputation to make it more com
petitive, and to assure greater job
security.
1
- The satisfaction of
self-esteem/
self-actualisation needs.
IK
'•
- Training in problem analysis.
26
27
i)
■ ■■
4-
WORKSHOP METHODOLOGY
"IJ-B—11—
■-
*
■■■
■
frwi—■■
11 '<ri1
RUHSA has found the workshop methodology to be very useful.
Within a short period of time, with coordinated input from the
faculty, the trainees are able to learn new knowledge and skills
and in certain situations have changes in attitudes. Each
workshop is being planned individually and we are now encouraging
the participants to be more involved in the initial input to the
workshop and also in the continuous monitoring and feed back of
the training process.
For each workshop we have certain objectives listed and would
like to cover them during the workshop. However we would like to
proceed at a pace that trainees can learn through this process.
In this workshop, the participants will be' involved in "Management
Team” approach of facilitating the progress of the workshop
recording the events of the workshop and also evaluating and
giving a feed back to the entire groups.
Allowing trainees participation in this manner, creates an
open learning climate characterised by participation, free
discussion, critique and evaluation. In addition, a number of
approaches will be used throughout the workshop for trainee
participations in the learning process.
This workshop process is modified from the methodology
used by COADY International Institute, Canada.
THE MANAGEMEb^ TEAM
The workshop process itself will be used as an opportunity
for participants’ skill development in aspects of management.
The conduct of the daily proceedings will devolve on the participarts who will in rotation, organise themselves in management
team of three. The members of these capacities during the work
shop, participants will have an opportunity for skill development.
The experience will be all the more fruitful as the teams will
have to produce reports under time pressure for daily presentation
and meet the friendly but critical appraisal of the group.
The management teams will carry out specific roles and
duties and provde their daily reports to their fellow participants
each day following their term of service. Their perfomance will
also be evaluated.
OBJECTIVES
- To provide opportunities for practice in various roles.
- To provide pa rticipants with continuous records of
achievement; and
- To provide participants with practice in evaluative techniques,
and decisions.
FUNCTIONS
- Utilise.the available resources to achieve the agreed
objectives as laid out in the day’s time-table.
- Implement the plan of action prepared by the team.
- Provide the.group by 8.30 hours of the day following their
duty, a written record of the day’s proceedings and an
evaluation thereof.
SPECIFIC DUTIES
MODERATOR
- Will conduct the proceedings in an orderly fashion; ensure
that the day’s proceedings’ operate according to the program;
- Will ensure chan when discussion groups are formed, they
are adequately briefed and that procedures for reporting
are set up.
- Will proceed with the team members a written report on
proceedings and evaluative comments.
RECORDER
- Will keep a racord of the main presentations and of the discussion
arising from them. Obtain and incorporate into- the record the
written reports from discussion groups and workshops.
- Will clear the report with the team ensuring that it is clear
and concise.
- Will present the final report at the first session of the
following day to the total groups.
- Will deposit a copy with the workshop director after presentacicn
and any amendments required.
.-
EVALUATOR^
- Will provide the evaluative comment on the group
process on the conduct of the day, on its orderly
process; on the level of interest and participation;
and on the quality of discussion and team spirit.
- Will make recommendations for improvement in the
quality of interaction and therefore of learning.
Clear the report with the team mates.
Deposit
a copy with the Workshop Director.
NOTE:
The reports will be reports of the team,
All
members of the team share responsibility for it.
Essential qualities for work with the
non-profit
Compassion, commitment, concern
Competence; self-confidence
w- Willingness to sacrifice
w Inspiring and supporting colleagues
w Recognising dignity of each person
w Humility
iw Listening to people; learning from
them
Self development; self-renewal
Flexibility
Partnership
AIDS
• Prevention of spread of HIV infection
• Care of persons with HIV infection
• Care of AIDS patients.
5*
Business
Not-for-profit
Life of accumulation Life of service
Development
people
Economic
development
Financial
Line
of >
Bottom Other parameters
Stake-holders
Community
Focus on customer
Focus
on
disadvantaged
Paid staff
Volunteers + paid
staff
the
Objectives
Create awareness of the principles and
practice of management in the social,
development-oriented,
not-for-profit
organization, by a brief exposure to a
variety of programmes and projects in
the sector.
i.
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Non-profit Organizations
A brief exposure of Management Students to Social Relevance of Management
AN INTRODUCTION
Management is important whatever be the area of human endeavour, individual or
collective: public (governmental), private, for-profit (business) or not-for profit
(voluntary). While many principles are common, there are distinct differences in the
management of the three sectors. Being exposed to the different principles and
practices of management in the different sectors can help the students of management
to grow and develop. I shall not deal with the government sector. I shall deal briefly
with the not-for-profit sector and compare with the for-profit or business sector to
which you will be exposed during your period of training.
Your learning will be
mostly based on the business sector. Exposure to the not-for-profit sector will
hopefully make you a more complete person.
1. Objective of the programme
To create awareness of the principles and practice of management in the social,
development oriented, not-for-profit sector by giving exposure to programmes and
projects dealing with health and development, including
•
•
•
•
•
•
•
•
social work and social welfare
social justice
community health
health care services
education
social problems, such as child labour, street children, rag pickers, AIDS
agriculture, water management, etc
environment and other issues.
It will not be possible for each one of you to be exposed to more than one of them.
You will have to make your choice.
2. Business Vs. not-for-profit organization
Almost all of you will be looking towards joining and working for a business
(industry, firm). A few will opt for the not-for-profit organization, as the
postgraduate from TIM Ahmedabad who is now the Director of the Blind Men's
Association, Ahmedabad. A life in business is a life of accumulation mainly. The
not-for-profit sector involves a life of service. There are elements of service in the
business sector also and increasingly so today. Business looks for persons who
relate to people at all socio-economic levels. They would like to get involved in
development programmes. It is partly altruistic (they want to give back something
to the people, less fortunate than themselves) and partly because governments give
preference to firms who get involved in development (eg., Tata Steel : We
develop people). These firms need people who can help in implementing such
development programmes.
In a not-for-profit organization, most of the people, especially the top executives
or leaders do not work for a living. They have to live and therefore take a salary
but that is not main reason. They work for a moral cause. After many years of
work in business sector, many top executives start or join a not-for-profit
organization. Your short exposure will be a useful experience.
Performance and results are important in both sectors. In a business, there is a
financial bottom line. True, profit and loss are not enough by themselves to judge
performance but they are certainly measures that can be used to take stock of
performance and results. In the not-for-profit organization also the balance sheet
is important but, other parameters are more important. These are more difficult to
measure and quantify.
3. Vision, mission, goals, objectives
Whether it is a business or not-for-profit organization, there is need for Vision and
Mission. The persons involved must work for the realization of the Vision and
long-term and short-term goals. But there is great difference in the Vision and
Mission. The Vision has to be human centred development in the case of the notfor-profit organization and the Mission is to achieve it.
4. Volunteers
A sizeable part of the work of not-for-profit organization is done by volunteers.
They give their time and talent freely or for a very small consideration. They are
colleagues and not paid staffs who have to do a 'job'. The not-for-profit
organization strengthens, encourages and enriches the lives of volunteers. There
are no such volunteers in the governmental or business organizations. You will
have a different experience working with the volunteers.
5. Clients / customers / constituencies
The constituencies vary. Not-for-profit organizations have many more important
relationships. The most important is the relationship with the community. The
not-for-profit organizations serve the community interests and needs, focussed
mostly on the disadvantaged; child labour, street children, rag pickers, slum
dwellers, AIDS patients, terminally ill and similar groups. For each one of these
groups, many aspects have to be tackled. Take AIDS. An organization to tackle
AIDS may be involved in
®
©
®
prevention of spread of HIV infection, or
care of persons with HIV infection and other needs, or
care of AIDS patients.
If the aim is prevention, the organization deals with persons who have not yet
been infected. If the aim is caring for those infected but not yet full-fledged AIDS
patients, the organization has to ensure protection from or management of
2
intercurrent infection. The objectives in the care of AIDS patients will be very
different.
6. Qualities of persons in not-for-profit organizations
The qualities required for Managers or Executives are similar whatever be the
sector. People work in the not-for-profit sector because they believe in the cause,
especially of the disadvantaged and against injustice. Certain qualities are of great
importance. The differences are of degree and emphasis. Among the important
qualities are compassion, commitment and concern, willingness to sacrifice own
requirements, inspiring and supporting colleagues, motivation, recognising the
dignity of each person, humility and willingness to listen to people and learn from
them.
Qualities like competence, self-confidence, flexibility and sense of
partnership are common.
The effective not-for-profit executive has the
responsibility to make it easy
•
©
•
for people in the organization, especially the volunteers, to do their work,
to have the results, and
to enjoy their work.
7. Self-development; self renewal
The people working in the not-for-profit organization has to continuously improve
themselves, as in any other sector. They have to develop their skills, competence
and ability to contribute to the achievement of the goals. Self-development is
more important in the not-for-profit sector.
It is important that you develop yourself continuously and then renew yourself. A
time comes when you jump into something new, something different. You want
to follow or cut out a new path, become aware of a new horizon or you move
towards a new destination.
8. What you would like to be remembered for
At every stage in your development, you have certain aims in life. You would
like to be remembered for something. You may accomplish it or not. But it is
important to keep your sights on what you want.
Decide what are the right things you want to do. Business requires that you do
certain things and do them right. They look for efficiency. In not-for-profit
organizations, the emphasis is on what you consider are the right things and, to the
extent possible, do them right. You carry your activities based on your priorities
and the needs of the society.
PRACTICAL HINTS
Select an organization / programme / project in which you are interested with the help
of the faculty. Study it. Write down what you expect and then plunge into it.
3
Write down each day's experience in detail, especially your interactions with the
community (the people, the participants), the faculty, the staff, the volunteers and the
leaders. Note down carefully your observations. At the end of your assignment
compare your expectations and what happened. From them you will get your learning
points which will be useful to you throughout your life.
Remember that during the short exposure, you will be contributing little but
contribute as much as your can. You would have gained much, depending on your
involvement and be grateful to the people for the experience.
4
Issue 18 April-June 2001
I
A Quarterly Update on Management Issues from the
Administrators Section of the Christian Medical Association of India
Ib
‘De.aT Members,
i
I
i
I
I
i
Early on this year two major
incidents shook the nation out of its
stupor.
The first was the Gujarat earthquake
and the other was the expose of the
deep rooted corruption in our muchtouted democratic system.
Both however, have left a dent on
our psyche and exposed human frailty
like never before. It is during such times
that we realise, that the only insulation
from similar onslaughts is our firm faith
in Christ and his teachings.
The Healing ministry is an inevitable
part of the Christian ethos and it is in
keeping with this, that the CMAI
reaches out to serve. We responded
to a request by the Christian Medical
Association of Bangladesh (CMAB) to
organise a ten day workshop on
Hospital Administration. Twenty-eight
delegates from all over Bangladesh
attended the programme, which was
scheduled from April 15-25, 2001 at
Christian Hospital, Chandraghona.
CMAB president, Dr S M Chowdhury
hailed the workshop "as a historical
milestone between CMAI and other
countries". CMAB has 30 mission
hospitals as its members - a creditable
feat when the Christian population
accounts to be mere 0.3 per cent of
the population.
ften Apostfc ‘Tfiomos who is
cnfteif 'Diifynius is quoted hy
uuuiy people for his disbeliej. 'J(is
name oecurs in other gospels hut in
the fourth gospcf, John paints a
distinetii'e character of'Thomas. 'The
incident oj Jesus appearing to
'Thomas after J his resurrection (John
20:24- 31) reveals the uniqueness of
his character which was not swayed
hy information alone.
Population statistics cannot be
ignored. It is because of galloping
population and a decrease in per
capital health care expenditure by the
government that private health care
providers are mushrooming all over.
Health care is now corporate business
and like all other consumer facilities is
covered by consumer rights and health
insurance. Our lead article on health
insurance is an overview on this topic.
‘J 1 Tien Thomas said f lMy Lord
and iMy (jod" (John 20: 28) he
underlines his personal affirmation
and teaches us the difference hetzveen
hyozinng Christ and ozvning. The
cru\ is: (Do 1 ozim Christ in my life or
do 7 just hno~w Him as (jod?
The CMAI is gearing up for its
platinum celebrations. We look forward
to meeting each of you in November
at New Delhi to make this celebration
blessed and meaningful.
Justin Jebakumar
Assistant Secretary
-
Christian
Medical
''K'V Association of
India
Biblespeak
-
■
-
-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Manaqeinenf by objectives works if you know
the objective. /\)inety per cent of the times we don,i.
Peter Drucker
"h
lb
I
$
IBS
...;J
@ Clipboard Issue 18
is
nmmii INSURANCE
..
◄
*
<
■■■he new economic policy and
I liberalisation process of the
■ government of India has paved
the way for privatisation of the
Insurance sector.To regulate insurance
companies and its activities, the
Government of India has formed the
Insurance Regulatory Development
Authority (IRDA). It envisages to
improve oerformance and efficiency of
insurance companies.
Insurance is prepayment for
services that will be paid for by a
(public or private) third party (i.e. the
insurer) should a particular event
occur. Insurance reduces risks by
pooling risks. Health Insurance
provides financial protection against
the high cost of medical treatment
and unpredictable health events.
Experience from other countries
indicate that if the health insurance
sector is not regulated
properly, it can lead to
adverse consequences.
Existing Health Insurance
i) Mandatory Health Insurance
Government runs two major
health systems viz. (a) Employ- .
ees State Insurance Scheme (ESIS)
for industrial workers (b) Central
Government Health Scheme (CGHS)
for central government employees.
Under the schemes the beneficiaries
(immediate family members) are
provided a wide range of services
through government managed
dispensaries and hospitals.
/x
Health insurance
if not regulated properly,
p'Vx
can *cat* to
j ?
adverse
consequences
■'•x-
ii) Voluntary Health Insurance
Voluntary health insurance schemes
for individuals and corporations are
available through the General
Insurance corporation (GIC) of India.
GIC offers MEDICLAIM policy for
individuals and Groups.
iii) Employer Based Insurance
Health Insurance is offered both by
public and private sector companies
through their own employer managed
facilities by way
of lumpsum
payments, re- ft
/
1
imbursement
of employees health expen- I diture,
the group health insurance
policy
in which accessible care of good quality
can be organised using a maximum of
non government resources in a
transparent and accountable manner.
Different insurance corporations
in India have designed medical re
imbursement schemes for individuals
or groups of urban areas (see box 1).
Under these schemes, the insured
person makes the payment to the
service provider (hospital/clinic) first,
thereafter submits the bills to the
insurance company for the purpose of
reimbursement.
Different schemes have different
premium and benefit coverage, some
%
1‘
.
'*i
0 Group Mediclairn Pobc/lp
iSCSSil
with one of the subsidiaries of GIC.
iv) NGO Health Insurance Schemes
A number of co-operative societies and
NGOs (SEWA) have formulated
different health insurance schemes for
their members, particularly for those
who are in rural areas and non-formal
sector. These are estimated to cover
30 to 50 million people. Most of the
schemes are financed from patient
collections, government grants and
donations. Patient collections generally
comprise premiums or fee-for-service
payments. Many hospital-based
schemes pay hospitals on a case basis
or fee per service basis. A major
challenge is to find ways and means
of which are given (see box 2) for a
quick understanding of the factors
involved.
Health Insurance Issues
Conflicts arising out of adverse
consequences, if not regulated properly
• Moral hazard
• Information gap problem
• Fraud and ethical standards
• Consumer satisfaction
• Impact on cost of care
• Payment mechanism for doctors
and hospitals.
L '''
Clipboard Issue 18
Recent Innovations
(Box 2)
1. Preferred Provider Organi
sations (PPO) consists of a
network of health providers,
which may include doctors and
hospitals. PPO is offered as an
option to employees in lieu of
traditional indemnity plan. The
providers in the PPO network
offer discounted service charges
to the employees of PPO
covered organisations.
2. Health
Maintenance
Organisation (HMO) .
It has four attributes:
1) An organised system for
proving health care in a
geographic area, which entity
accepts the responsibility to
provide or otherwise assure the
delivery of 2) an agreed upon
set of basic and supplemental
health maintenance and treat
ment services to 3) voluntarily
enrolled group of persons,
4) for which services the HMO
is reimbursed through pre
determined, fixed, periodic
prepayment made by or on
behalf of the each person
or family.
Issues for Mission
Hospitols
■
Policy/Scheme
Target
■____________________________________________
Annual
Premium
(in Rupees)
Coverage
(in Rupees)
Jan Arogya Scheme
Adult individual
70
5,000
Jan Arogya Scheme
2 Adults + 2 Children
240 to 380
20,000
SEWA (Self Employed
Women’s Association)
Insured for Sickness
And Maternity
30
1,000
300
Birth Right Policy
Expectant mothers age
200
group 18 to 45 yrs, covers
to 1,500
4I
■' 1 ■
congenital anomalies
1
10,000
to 75,000
1
.....
New India Assurance
Company
For permanent residents
of Goa by Govt, of Goa
1,00,00,000
(for state
of Goa)
30,000 Max
for an episode
of illness
Andhra Pradesh
Government
Couples below poverty
line, who undergo
sterilisation
75 per family
borne by the
Government
4,000 per year
20,000 for 5
years
State Sickness Fund
of the Government
of West Bengal
For poor people
Funds depend
on budgetary
support of
the Govt.
Reimburse
medical
expense
Mediclaim
5-70 Age group
2,825 to 5,700
based on age
Reimbursing upto
3,00,000
Good Health
Mediclaim
Upto age 65
646 to 4,436
based on age
55,000 to
5,00,000
Medicare Service Club
(Empanelled Nursing
homes/ hospitals
Upto age 70
900 to 5,304
Members
1,00,000 to
5,00, 000
j
1
i
• High motivation to serve the
poor
• Modern equipment
• Prompt service
• Service vs resources
• Transparency in providing
information
• Study and awareness of different
health insurance policies, with
particular reference to claim eligibility
• Cost vs affordability of the patient
• Cost vs technology upgradation /
modernisation
• Regulatory matters like:
Consumer Protection Act
*■ Code of ethics of doctors
*■ Improved documentation,
dissemination of information /
data and communication
*■ In some developing countries,
••• f
community groups, rural co
operatives and mission hospitals
have created networks of informal
insurance funds to finance
emergency medical care or simple
health services for members
Periodic training programmes to
different categories of personnel
The clinic/hospital should be ad
equately equipped and staffed
*■ Establish health information
system
Conclusion
The mission hospital is faced with
situations, where patients look for quality
health care as most essential. This is an
opportunity for mission hospitals to
upgrade the hospital systems.
Considering the implication on private
health providers, it will lead in the
direction of developing high cost and
accreditation system for providers.
Also the models emerged else
where (ACCORD, SEWA) need to be
studied and applicability to be
examined for community based
insurance schemes. Many of these
schemes have been implemented
successfully by effective monitoring
mechanisms, pricing of various
services, linking of insurance schemes
with savings etc. To conclude, health
insurance is a cover and protection for
everyone - the insurance company, the
hospital (service provider), the patient
and government. Should we not look
for a win-win situation?
Dr. Sweety Premkumar
Management Consultant
7'
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® Clipboard Issue 18
XiVlli Workshop on Hospital and Health Services Management, 2001
he XIVth workshop on Hospital
and Health Services Manage
ment was successfully organised
at Bangalore from February 4-16,2001.
CMQIST1AN MEDIAL ASSOCIKHOH OF INDIA
Thirty participants, which included
17 administrators, nine doctors and
four nurses had a 14 days intensive
training programme.
Ml
Bi
The day began with Bible study and
prayer and many of the participants
appreciated this quiet hour before the
days hectic study session.
Mr. Stephen Hayes, CEO of the Aga
Khan Health Services in Pakistan along
with Mr Brian Windsor led the first
week’s teaching covering the fields of
general management and, human
resource management. The duo
brought the participants the fruits of their
rich and wide experience in the UK
National Health Service and Mr. Hayes’
challenging experiences in Karachi.
Field visits were made to the
Manipal Heart Hospital and another
to Bangalore Baptist Hospital which
proved to be a good learning
experience for the participants.
The second week covered more
specialised topics such as Finance,
Human Resource Development,
Hospital Laws, Strategic Planning and
Total Quality Management contributed
While the learning was a challeng
ing and broadening experience, the
more difficult task of its application at
the workplace will be the real
measure of the success of this
mainly by eminent visiting faculty.
TT
Finance Act
Amendment, 2001
"3°he following clause (c) shall
9 be inserted after clause (b) of
section 12A by the Finance Act
2001, w.e.f. 1-4-2001.
(C)Where the total income of the
trust or institution as computed
under this act without giving effect
to the provisions of sections 11 and
12 exceeds one crore rupees in any
previous year, the trust or institution.
I
■■
1
(i) Publishes its accounts in a local
newspaper, before the due date for
furnishing the return of income
under sub-section (4-A) of section
139; and
(ii) Furnishes a copy of such
newspaper along with such return.
L
Source: Income Tax Act, 2001
Information sharing
We have been receiving
useful informcifion on
»v\anage»nenf
h
ana it's
related
yields
such as
finance/ legal etc.
you would like Io
receive these injo»‘>nation
by e-mail/ kindly send your*
e-mail to the editor*:
Justin, |ebakurHQ>‘@ crnQi.org
workshop. The organisers have already
begun planning the next year's workshop
and welcome suggestions for improving
and including topics of interest.
'■"J
Clipboard
For Private Circulation Only
!
Published by the Administrators «
Section of the Christian Medical
Association of India
CMAI HQs
Plot No 2, A-3 Local Shopping
Centre, Janakpuri
New Delhi 110 058
Phone (011) 559 9992/3
Fax (011) 559 8150
E-mail: justin.jebakumar@cmai.org
Editorial team
Vijay Aruldas
P. D Mathew, S.J
Jeyakumar Daniel
Mini Varghese
Arwin Sushil
>
►
n
Editor
Justin Jebakumar
►
Design & Production
Indira Mark
Printed by Impulsive Creations
.w
►
7
■
Hi'
j
Christian
Medical
Association of
India
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U-
A/COMF.166/PC/L.13
English
Page 42
Employ^ nt rclicy should be used more..ex tens ivPiy-jLcy^courfKpi
1 ncentives, and to facilitate, .wrth^pp.ortj.nc assxstAGc
number of skill-intensive ?c;ps___in rhe service seeper
E.
Pedef-ninq the nature cf work and emploY^nt.
116. It is necessary to broaden the very conception of work with a view
cheating the possibilities for greater r.uriber of persons to participate
meaningfully in worklife. There is a great deal of socially useru. wcr z r-.zz
could be performed within the framework of a wider conception of prccuc
and employment.
Care for ageing populations, humane responses to tne^neecs c
^.e homeless and instilling social values in children are iust sore o^ t..=
personal and human services that need to be carried out more extensively.^
k
While such work cannot -replace more traditional forms of sei- e...plOj .-e.. wacs er.nloymunt, it is beccmir.g increasingly important and deserves .u_-er
attention as a complement to other policy action.
The instituticna. ano
challence is to create mechanisms which encourage greater performance or
Socially useful work by combining the functioning of the market with the va.uci
Ind\otlvatLcr.s which underlie much present-day volunteer activity.~ A re.ater.
cnaller.ee is co address the fact that too much work performed by , women
- .rrer.t iv toes unrecognized and unremuneraced. Greater financial recogni-ic.. •_
multiple
roles both within and outside the’household could improve t-.c„
.T,- status, ecc
eccr.tr.ic .-dependence and treatment within societyr." s. z: -? 1
Gpvernrer.rs a-f the various actors in civil society sno-.iid
irerenrs
Active dialogue on the Possibilities and institutional reov
ir.rrocuction of a broader conception of w-err.k—ano—g^~-P-L
v. i •: e r
’-7
=
WhUe the central aim of employment-centred policy and development scratc..--.
ren, women and young people who seek alternatives to a full t-me joo.
Co-ventXonal part-time employment and more innovative work-shar-nr on- 3-•-a-ino arrangements may ue welcomed by many single parents, spouses or
4’c need to divide their time or wish to share employment ano ramr.j
resoonsibilxtres more fully, young people who could benefit from^om^inin^
education and training with work, elderly workers desiring a p-■.»«. «• . - - »•
end disabled workers preferring a shorter work week. While e-um^e--a'ternative working arrangements can be found in all societies,
the move in this direction will require broader-based change. 7; “y-y"",,
~-d~accompanying institutional arrangements.
In industrialitea coun — yr:t ;Xdecade: now the traditional life cycle has consisted of syceo.i.^ .
re-'ods of education, employment and retirement, the time is ripe
consider and actively encourage alternative lifestyle patterns, as
=areater alternation among activities.
Governments should examine personal taxation and social security
legislation with a view to ascertaining how provision^, could be ch?.r/;ii2
facilitate much greater flexibility in the division o.-_ a person's
Si
“
‘
-............
I
A/COxN’F. 166/PC/L. 13
English
Page 43
4
between education and training, paid employment, volunteer activity and
other socially useful forms of work, family responsibilities, and leisure
and retirement.
F.
(
Fo c u
1 r. a on specific needs
113. Young people, woman workers, the long-term unemployed and mic.ant workers
are some of the groups of people with special needs who require additional fores
of assistance.
Young people struggling to find a first job, women performing
multiple roles that Leave them overworked and underpaid, migrants facing unequal
job opportunities, disabled workers confronting discrimination,, older workers
compelled to overcome negative stereotypes, and indigenous and tribal peoples,
who are among the poorest, least protected and most vulnerable groups in
society, all share in common their disadvantage in securing and/or retaining
good jobs.
While all such groups can benefit from a major upturn in employment
generating activity, each experiences particular job market and employment
problems of a qualitative nature that call for specific, well targeted,
supplementary forms of assistance.
Prccrammes for disadvantaged or vulnerable crouos, in addition tc.
reflecting a true understanding of the underlying problems of each croup,
-pass the test of being both ecuitable and efficient.
The-, recuira
•"cntinucus monitoring and periodic evaluation to 'ensure that the--.- are
r"£.chirc their intended beneficiaries and producing results which ore
sustainable.
119. Young people in growing numbers across the globe are out cf work and
running out cf hope. They are particularly prone to drug abuse, criminal
activity and violence.
Only through productive work opportunities can they be
helped tc gain a foothold in working life and to assume active and meaningful
roles in their societies in the years to come.
High fertility rates require
that productive jobs be created for a continually growing labour for_e under
conditions of already widespread unemployment and underemployment.
Here general measures aimed at expanding productive employment and reducing
ur.emolovr-ent must be complemented by specifically designed and targeted
•cuth training and employment programmes.
Younc people should be ass;-ted
thrn-uoh a combination of programmes providing basic kncwledce,. :err.r..:a.
ano social skills, work experience and temporary employment:Youth ser.e-ez
ant special youth employment programrr.es should serve the purpose cf
creoarinc voung people for durable employment opportunities or facili* •
".g
their seif-employment.
120. A rising proportion of unemployed youth also form part cf the long-terr,
unemployed, although the latter problem cuts across the full spectrum of the
working-age population.
Mid-career and older workers trapped in Long-term
unemployment can suffer an erosion of their skills and a loss of human dignity.
■.■ istance packages for the long-term unemployed should place special
or.asis cn retraining, counselling and job search components.
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A/CONF.166/PC/L.13
English'
Page 44
4
121. Higrant workers have made ^nt^?°^“^5^C°2nerally"improved their own
countries of immigration and,
P
hl^ina of foreigners is demand
employment and income situation.
® 7J
But growing inecualities between
driven, it tends to be entirely benefic.a .
'7 excess of the entry levels
countries have increased pressures .or em.g^
an increased temptation to
fixed by host countries. As a result,
—
.
thiE ,-nvolves.
A-r.iv
migrate illegally, with all the risk of ^t^Xlor^on!
well as to
cooperation is required to maximize the ^nefits of migration,
facilitate the reintegration process of returning mig.an.s.
intensified international cooper-scion and
There is a need ror
■hich would be i
assistance among countries of. emigration and immigration^—
the interest of both.
122. Women have specific needs requiring employment P°^c^s
neceOri
within the household and within society at large.
•
rw- trifle needs cf women, policy makers and the var.CJS
In focusing on th* soecitic neeco-------- on uc-^r.1 s ru 111r 1 €
actors in civil society should place crea.er e„ph ■ - ■■ y- ■---------and on how these both influence ar.-- pre ..w-en---- ; -■--- ,
e.r.c
institutional support systems -nyrt change acc^-^^-q..^.123. For the
particular, efforts must ~e
and demand ana to hexp worker
ti~ly
employment opportunities can as
continually changing labour market
d
liable information on
”i:X.“=
crlen-. V..W
u
-
f labour force movement acres
the economy.
In adax^xon uO t..e-jr
helo naise job seekers
unemployed workers, public employment se
valuate special employment
of employable skills, develop, °P-ateand
ECb ernes,
programmes, and manage worker redeployment and reioc
levf
a-w the yp 1 e v a nt o r c a n -t z a - l on
. >
pettier, -he capacirv_ei~
The international eontunK^3"^1^
of the United Nations sys^entj—
hn-ntries and econcnies i~
national administrations in
■ -1 labour market information.
-transition to rnllect and effect ,vely
lnnaction cf aoproori^
construction
Greater assistance could be -orovi '
s._ or the reeu-reg
and analvsis_
indicators and the collection, nomE^a^cr
information for peliry purposes-
employment services also mighty----- - —
rance
Tn consultation with
employers
; nate~ Luch
placement .
t-raininq, iob search and
/
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A/CONF.166/PC/L.13
English
Page 45
G.
Enhancing the quality of employment
124. An employment-oriented approach to development dees» not imply creating cr
condoning any type of work.
It jrequires improvement in the quality of both
Technological
improvements have eliminated many jobs
existing and new jobs,
arduous
cr
unplea-ant.
Yet there is considerable scope
which were hazardous,
An
example
of
the
dichotomy
between more jobs and better
for further progress,
jobs can
be
found
in
the
fact
that
while
more
women
are employed worldwide
can be
f-odav, most of them are still clustered in low-paying, low-skilled jobs offering
little or no potential for -advancement. The aim is to create more, and better,
value-adding jobs, to provide people with the qualifications to fbll them, anc
to facilitate the matching of suitable jobs and qualified workers.
125. In broad terms, the quality of employment covers the content ana methods or
( ork; the income received; working conditions, including safety and health
practices; the terms of employment, including job security; equality °opportunity and treatment; and the nature of the employer-employee relationsnip.
Higher quality employment increases motivation and productivity and leads to
higher quality work/ It is the most productive enterprises, in turn.
turn, that
directly or indirectly create the most employment over time, High quality jobs
thus be seen as good for workers and employers alike.
12c. Improvement in the quality of jobs, lust. as in the number of jobs, is a
fertile area for social dialogue between pud.ic authorities and democratic and
“, including employers' and workers’
representative institutions and groups,
ttached
to sound industrial relations
erganizaticns.
Thus, importance is at-,
systems based on freedom of association and the right to collective bargaining.
‘ » safeguarding the basic rights
227. Fundamental to the quality of employment xs
the
abolition
of forced labour, freedom
of workers.
Standards in such areas as 1-- ---of association, the right to organize and tc collective bargaining, equal
-emune-ation, the abolition of child labour and the elimination of
discrimination in employment have been widely ratified by Governments,, but their
1 ^pLication and enforcement can still be strengthened.
strengtneneo. iSpecial attention needs
‘ -- be civen to
tc the total abolition of forced labour and the progressive .
should be promoted.
Employment which does not meet minimum standards must be
ungraded.
Governments should more strictly observe. their obligations under the
standards which they have ratified—in the field of human rights.
E^uvers- and workers’ organizations, ncn-govem^-nfal organizations, gnd
rights and community croups should alTnlav-an active ro e xn^^
cr?a;.e!- protection of working children and the prnn^sS1yg aboli^.on ot
child Lacour.
of migrant workers also should be respected and protectea.
.
128. Th? rights
community has shown that it is aware of the special proolems «-eo
international
members of their families, particularly m respect of
rv migrant workers and
integration in the host countries. The International
employment and social
' <1
A/CONF.166/PC/L.13
v-
r
English
page 4G-
Labour organisation adopted
^^^^''th^Migra^TworkerS convention.
£S 1949 and supplemented it m
ted the International Convent ion on
1990 the United Nations General '
Workers and Kerbers of Tneir
the Protection of the Rights of All Migrant wo
Families, but it has,not yet entered into for. .
.
,.
Ov--ctina in-t-^pnts pertaininc to migrant
the quality of employment should taxe ^cou
129. Efforts to improve
Of the informal sector. Informs 1 -«or e e.
special circumstances Protective regulation. They cannot a..o.d tne
*
operate of
outside
most to large numbers of
conforming
-^"ekstence.
burden
extent, they operate beyond the law reinforces thexr
large
th^efore, 'should be the progressive extension o. basic labou.^
chokir.^.
The aim, the.e.ore,
protection to the informal sector vi.houstandards and forms
off its ability to employ people.
Tn priority area, of protection, such as
and guidance on how to reduce riskand inexpensive measures.
■ration
girde
-----
130. If a major policy goal is to sradually ^proy-^h-^e---jot)S
employment and to enable workers to move from
;e raised for lar=e
better quality jobs, then education and s ilu le.e-s^na^^^ ed^iO3al
segments of the labour force in many countrx - sdi_aticn
systems
priorities and greater investment xn
. Q chances of holding
can enhance the quality of the
of promoting high-quality universal
better jobs. Experience has shown the
exam?le, basic education for
foundaticn
primary education m particular. In .-su ~
,
DrOvided a —
-—
all and wide access to secondary and
education ha_
But. it is
for shared growth and contributed suos^n ta^y children giaballv
globally are not
estimated that at least 13.0
^orow to 162 million by the ye^
and their number may grow to -- enrolled in primary school
2000.
to identify and eliminate the factors
5 131. It is therefore necessary
on the basis of gender, income, re. de..ce,
unequal educational opportunities improving basic employment literacy has to
ethnic or cultural differences.
At the same time, the, ^^^^^llsh^nt of
remain a high priority,
demano
as well as arrangements
skills and the iincreasing
---effective links between education
for continuous learning.
• ■?
ion among
need_tn_deyelo2_mors effegtiY^_XgESS^^g^|^=^-—
There is a
, private iQ. ■ ■
building better
public sector instil-ntions
an^o22e«tiyes_witn_a_^^c and
non—profit mst itutions
and training on the one
-na
-------bridges between education—
working life on the other.
u
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A/CONF.166/PC/L.13
English
Pace 47
t
&
?
132.
A solid general education provides good grounding for the acquisition of
specialized skills and for renewing, adapting and changing them more rapidly.
Training programmes have to be more responsive to the changing job market and
also ensure equitable access to training opportunities. Training cf the long
term unemployed to facilitate their reabsorption in productive jobs is
especially needed.
6
Training policies should offer incentives for enterprises to_ crevice, and
workers to a ecu i re r t r a ini, ng on a continuous has is—as—par_t—p__, a process of
adapting to changing technological and skill—requirements^ We 11-des igr.ed
and adaptable vocational training and apDrenticeghip programmes. are
important and should be encouraged and supported—through technical
assistance programmes, including those of the United. Nations system-
133. .Practical measures are required to improve the efficient and
non-discriminatory operation of labour markets.
Such policy efforts mcluae
stimulating the demand for labour; identifying skill shortages and surpluses;
providing orientation and counselling services and active help in 30b search,
and occupational choice and mobility; offering advisory services and support to
enterprises, particularly small enterprises, for the more effective use and
development cf their workforce; helping young people to develop needed skills
and find a first job; and establishing institutions and processes which reduce
dxsc’rxmination and improve the employment, possibilities of groups that are
disadvantaged in the job market.
Governmer.ts , together with emclcvers' and workers * organ!zaticr.su—snou 1 o
mere widely introduce, help to implement and monitor the results of—act rye
labour market policies.
IV.
A.
SOCIAL INTEGRATION
Revisiting social integration
134. Our societies are each the unique product of distinct local histories, but
they typically embrace different cultures and
they all have this in common:
linguistic, ethnic or religious groups;♦ and citizens differ in their perception
society and their place within that
cf their economic interests, of the good
v
society. We draw strength from this diversity and see it as enriching and
c.i-'ing vigour to our communities.
!■
We recognize that the concept of social integration is both complicated ona
potentially deceptive.
Social integration may take various forms, cepending _n
pa- on the context in which it is pursued.
Individuals are not alone u.
belong to social networks.
They are members of families, communities, etnnic or
v-eligicus grouts, nations and, increasingly, a global society.
Indiviauals
be integrated in varying degrees in one or more of these networks, ana
disintncration at any one particular level may not, in itself, be a cause to
ccncern’tut must be evaluated in the context of the entirety of
networ,^.
Hot a-1 kinds of integration are equally valuable and some are clear_y
The
undesirable, such as hierarchical integration and coercive integration.
/. - -
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objective of social integration cannot be pursued at any cost but only ir. s
as it is consistent with certain basic human values.
fa.r
i fe
P rotect incr the integrity of indigenous and tribal cultures and wavs ~
?.
t
e
leai
c
is an important goal. To achieve this, it is essential—that
in de f inine ecc " ~ - a n c
representatives of these peonies participate full
- ocial policies affectirc their life.
136. We believe that the aim of social integration is not to eliminate
differences but to enable different groups to live together in procu zi v e and
cooperative diversity -■ within our national borders and in wthe wider se111r.n of
An integrated society should be able to accommodate
the ’’global village”.
Xe
differences within a framework of shared basic values and common interests,
thus seek to promote a pattern of development that is consistent witn juszi
for the individual and harmony among groups and countries.
137. We also recognize that such harmony is always precariously maintained.
We
have seen and even experienced, the effects of polarization and fragment at ion,
of violence in its many manifestations and, on occasion, total social breakdown.
Ir. this context, we recognize that rapidly widening disparities - political,
economic, social - whatever their origin, need to be addressed.
B.
•->
Protecting diversity based cn shared values
133. A viable society will need to accommodate diverse interests and cultures
within a framework of shared ba.sic values.
The main elements of such a
framework are to be found in the international human rights instruments act red
since the founding of the United Nations.
Central to their message is the
conviction that unity may best be fostered by tolerating diversity, that
..hss*.
dissenting views should freely coexist with the dominant values of society
society,, and
that "a society for all" should be able to adapt to the needs of its various r
constituent croups.
In such a context, interaction among diverse peoples,
ethnic and religious groups, cultures and sub-cultures is a positive for-e
creativity, innovation and change.
138. When all groups in society feel that the institutions of government are
responsive to their needs, differences in wealth, income, accupat-ionaJ. pre strge
or social status are accepted, especially when seen to uphold a system wr.icn
rewards the special contributions of those who show enterprise, bake risks, work
in various other socially useful ways.
harder or distinguish themselves
1--------- --7 o rotect diversity v/ithin a framework of s h a red—yajj-iejs
measures should be taken:
three types of
(a)
In the public sphere, bv assigning responsibilities to tee differ?n
levels of government to take account of the interests ang_J-ultu res of
citizens in different regions and localities while—serving—t..e_ broader
national interest;
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(b)
In the market sphere, bv recconizinc the social value, of organ i z i r.o
functions around an economic interest, allcwinc autonomy c
t." diverse agents of society m pursuit of tneir gcal_s;
(c)
In the sphere of civil society, bv fostering a climace .that favours
organ i z at ions championing a rance or civic cb-.ectives and than as s i st s
j vjcoals in their inter'~tion with both government and the market.
140. If the institutions of States lose the capacity to safeguard the interests
of all citizens, irrespective of ethnicity, creed or belief, the tendency
towards social disintegration is encouraged, sometimes leading to group violence
and civil strife.
Such conflict has obvious negative consequences for
development, including a rapid increase in the number of internally displaced
persons and refugees.
k
Conflict resolution must include attention to social aspects or
reconstruction, including encouraoinc processes and mstituticns wr.ich
er.anle rehabilitation and reconciliation among previously hostile croues.
EQSt— conf 1 ict recovery not only must include a resumption or caveictrer.t
acti/fties interrupted bv hostilities, bur also represents an cprorzunitv
to address development in a different way, with more articulate emrr.asis c f
serial considerations.
The support of the international ccmrunitv for
cm cl idatinc solutions and for preventing the recurrence cf social
c—'.flirt
essential.
C.
Ending discrimination ir. all its forrr.E-
141. The idea cf Rus'‘ and "them" is age-old. Group loyalty can crten be a.
ze, while peoples’ discomfort with others who are different is
posi ive
ess.
What is socially harmful and disruptive is syoterratic
most
r.ar
by
the majority against minorities, or when a stronger group
discrimins ion
suppresses the rights of weaker groups.
(
142. Social antagonism and accompanying discrimination tend to be strongest when
fundamental economic stakes are involved, when there is sharp competition for
access to land and other resources, and for work, public services and benefits.
Periods of economic distress normally exacerbate such tensions.
Conflicts car.
also be aggravated, in periods of achievement when the fortunes of different
groups diverge markedly.
stcuId be a
Encino institutionalized discrimination in the public sohere
real:z -;c objective and must be a priority of policy.-- Atorqprxate
1 a c i u aticn is needed co counteract discrimination^—, Insisting,on
-crimination in the administrative codes and ordinances cf, put_i_ic
ir.st •■tucions is another measure that Governments can take.^ This can..be
>-; -.53&d by all public 1 nsv 11uu 1 ons sertlnq a—good—ex£r*p lc.
-he long-standing discrimination against women, based or. thgir
■ cr.allv subordinate roles co men, special efforts are neef.ed tc
•■2 policies to end discriminatory practices in emol cure nt ...educate on
?cess to public services, as well as in other domains.
/■
■
■
it
w
a
:<■
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A/CONF.166/PC/L.13
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orovit i r a
The concec-t of civil and political rights has proved powerfgl.._i
for
discrimination
with
the
rear.s
individuals and croups subject to_
co<r^ct-:r.c injustice and enhancing social integration,.-- <Cover r.me no s c~n
P-o^cte th.-.3 process by clearly stating the rights which. all c i t i z e n s can
expect to er.iov and bv ensuring that the legal system is ores. no all as a
remt-dv for Limitations or those rights.
In the aftermath of violent and prolonged conflicts, the interneticn^
community should assist countries and communities m securing
~
reconciliation among groups, reconstructing social institutions t .stbeen destroyed, reintegrating displaced persons and re--est.abl is., ing ..^i
rule of law and resnect for human rights.
D.
c
Promoting ecual opportunity
143 The end cf de dure discrimination, while essential, is typically or.iy the
^rst step to non-discrimination de facto, to the betterment of t.-.e quality c.
the lives’of women, ethnic croups, migrants cr disadvantaged ano margins.nee
groups. The economic, educational and other disadvantages that are^tne~r=a__
cf past discrimination can perpetuate inequality tor a leng time a.- = formal discrinrhnatimn ends. Legal prcnibitron or . siscruru.n=t-....
rigorously enforced, cannot by itself eliminate social discrimir.ati
Efforts cn a wide front are needed to promote ecrual .ccporzu-Ltv-c
especially in education and emolo\mr-ent. There is a neea tc ensure
such efforts do net provoke a sense .of "reverse” discnru_r.c.un•
Arbitration and conciliation procedures should be developed at :oca,.snx
national levels.
Systematic evaluation of procram.mes „.t o crorote
opportunity and of their effectiveness is needed, as weD as a svsterrat.ic
exchar.ce cf national experience, particularly at the_regicnai .evei.
144. Recalling the earlier analysis and proposals relating to povert> an^
employment, it is evident that equality of opportunity can most easny -*
fostered in a context of expanding economic horizons and eeplojren., goals
already identified as important social objectives in themselves.
• x: • _ — - j c y a a
ST"?
needed
r
PO o H
to
encourage
t
O On
C OU . 3 O 6
or even entire communit.es, specific
azures a—_
of displaced workers.
econcmic activities ant the soeedv reabsorption
E>
c
ew
Education as an integrating force
ializing children and
14S . normal education is new the principal means of soc the immediate family.
provides their first opportunity for interaction outside
es
in
Access to education and the quality of education condition oppo-tuni^
them
to
cop
later life. The education and training of young people prepare
The
with their world and their future, including their professional life.
I
/. . .
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Page 51
first-time job seekers will depend on the content c. the
prcssects cf
curriculum and the nature of the training receiver.
ecucaciona1
145. From the perspective of social integrationt therefore,
basic education - and thereby to knowledge and information
effective social functioning of groups and indivicuals m a mcoern
the
increasingly depends on it.
147. Access for
all to
education is
is also vital to the fostering cf share
for all
to basic
basic education
values in a society
and
to
the
provision
society and to the provision of
of a corr.mon starting-point for en.er...
employment, pursuing opportunities in formal secondary or higher education ant
active Participation in civil society.
Universal access to primary educa.ien
It
does, ..oue.e.,
does not guarantee equality of opportunity in later life.
It does,
mitigate many existing social inequalities.
Er.ab-ir.c cirls to complete their education ir cf fundamental iroortar.ee.
The lonc-term pains to society, and not just for the status cf women, fre
the increased enrolment of girls in—schocx, are substarrial.
imarv education, it can
'■'•’h-zr cualitv varies sharolv at the level cf
rarretiate di'~isiveness while appearing to promotea intecrat icr. and eczs'
Attaining greater uniformity of quality while raisir.c
challen.ces
deserve
srar.dirdr
and which
expanding
enrolment
attention.
arrgnticn needs to be given to the? o-ovision of s c h c 1 f a c £ 11 - 1.
fo„ ^;idren in freely populated and remote areas, for cbi^ren cf
nerxtic, oastcral cr migrant parents, and to securing access to scr.oc-^-- - children or children carina for vcuncer srri'r.as er -is^.vv_.
rarents, for disabled children and for children st icmar i ..ea
■' -? reason.
r.i,. 3-.-on should be seen as a powerful tool against discrimmaticn■
=
-olicv must also strike an appropriate balance bef-e-n r. - --1,,..-.
;;"on vaIue5 on vihich a society is built and preserving an create
div-rsitv of -regions, cultures, languages er religions^—==—e z-7;-.zmc content and orientation.
F.
Establishing the principles of access to the
institutions of the State
a societv to bo truly integrated,
it should be based on -h.e principle
148. For
in matters of law,
of equ-.-l c-oatment cf those in the same circumstances
health care,
taxa-l jn a-d the provision of public services - education, services - while
she I”. ’
~
-■=t=d services, social welfare or developmental
the need for differentiated treatment to allo- for differences >r.
recc.-' . _ air.
indi- - dual circumstances.
should be most
will depend
149 .
^fficientlv distributed to meet tne needs c_
' "through” public intervention is best promoted by universal provision
equality
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4
Page 52 ’
when the resources are relatively easily available and by targeting when tr.e
resources are particularly scarce. When scarce resources are thinly spread to
Those with
provide universal or wide coverage, quality tends to suffer,
adequate means will then tend to seek better private provision, undermining the
integrating function of the public services.
From the perspective of social integration,—or the cb^ec-.ve q.-.
social cohesion, it is j-jortant to keep a balance between universal .!.
oualitv, between accessibilitv for the poorer segments of sqcietv.anc
continued interest in participation by those who are better oft
between protection of the weak or vulnerable and the orcnction c: :.ne
interests of broad segments of society. A praqmatic.approach is to^
concentrate on policy measures to meet the needs of wide segments .cf
society, supplementing such measures with programmes aimer, at crours_w^
specific problems.
In this wav, access to the opportunities avaiia^
through general policies is facilitated.
c
G.
P.escondinq with snecial measures to special social r.e^ds
prccr arrrre,
150. In order to mobilize efforts or resources for any policy
cf scc _ al
must
be
either
strong
support
from
vested
interests
or
a
notion
there
solidarity.
By definition, disadvantaged cr marginalizes groups cc r. z have the
cr the
power to advance their own cause, but must appeal to sccrax sc^ndar-t
common interest.
------ - which rnay ceneiir
Public support has tended to be strongest for prograncnes
of
actual
beneficiaries at any cne
copulation groups mu ch larger than the group
others
f
uneniplcyment
and disability
time.
In this category belong, among ctttrz
benefi-ts.
it is important to engender a
152. From the perspective of social integration, certain services. Where
shared
interest
and
universal
access
to
sense of
quality is of major importance • education
-------- being a particularly prominent
the better-off strata but main^ f
example - a public system that does not serve
the less well-off tends to fall short on quality, Such a system will tend to
perpetuate the very divisions it is seeking^ to redress, Voluntary opting out by
privileged access tc
the middle classes may be as serious a problem as their
1
publ ic services.
Policies for the disadvar.taced should be designed so as tc s^vure.and
retain public supvcrt or a scale commensurate with needs.
j stressed in the framing of »pcza . pclic\ is
153. An important prirciple beina
jpecial
needs rather than problems,.A positive
that the emphasis should be on s;
attitude
emphasizing problems
I
attitude emphasizing needs rather thai* a negative
it is also more
is in the spirit of a society able to, accommodate differences;
public support in the long run.
likely to mobilize and sustain
!--
154. Needs change over time and it is important for institutions and public
policies to be able to adapt, to
to change and preferably to anticipate ch.n.e.
/...
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Pace 53
a
However, there are certain groups such as the aged and the disabled whose needs
are widely accepted:
r.<here demccraphic chance is towards an aqeir.c of the copulation, public
resources and policy attention need to be reoriented, and public services
adapted so that older cersc"^ can maximize their contribution to sccietv,
in the spirit of "a. society for all".
Policy concerning disabled persons must focus on the abilities of persons
with disability rather than on their disability: on the contribution thev
can make to society rather than their claims on society; and on their
dicnitv and rights as citizens rather than as objects of charity or
we 1 fare.
(
H.
A shared concern:
of cricin
fair treatment cutside one *s country
155. Discrimination against strangers is age-old.
Strangers were defined only
recently as inhabitants of a nearby village; now, more typically, they are seer.
as citizens of another nation; as foreigners inhabiting, or making claims on,
another State; or as refugees or migrants.
156. Notions concerning the freedom people have to migrate in search of a better
life and their right to cross national boundaries and settle in other countries
have differed over time and from place to place.
Migration today occurs on a
massive scale and is unlikely to diminish in the near future; it is more likely
to increase.
157. The capacity of societies to absorb migrants varies.
The limits of
absorption will depend not just on numbers but also on the objective conditions
in the host society.
Targeted government measures as well as the example they set for the
efforts of the institutions of civil society can help shape ro~itive
attitudes towards migrants.
Policies to protect migrants arc to promote
decent conditions for them will enhance their contribution to the host
scciet-v and help to maintain social tranouill itv.
Migrants, once acr.lttec;
have the rlcht to the full protection of the laws of the host society.
153. Migrant children and second-generation migrants often face a particularly
difficult situation.
Having acquired the expectations of their local peers,
they do not easxiy accept the values of their migrant parents or willingly
tolerate the hardships their parents have faced, and yet they are often
confronted with Lifelong discrimination as outsiders.
While their parents are
typically integrated into the host economy, although often in subservient role_:.
these young and second-generation.migrants are often in danger of being
marginalized or excluded from society; or they may be forced to repeat the
subservient experience of their parents.
Preparing these young people for work and breaking down barriers of
hostility and exclusion are two essentia] dimensions to government efforts
/
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A/CONF.166/PC/L.13
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page 54
to improve re^atlgn^bet«een sxgrant
hroadlv, to.jgrcsote SociaL£eh£^
of government p<; nther
particular concerns.
an01°=t Dpoui^j£IlS-^^
V. e- ^nrreased dramatically in recer^
159. The problem of internatio.-.-x
a ethnic and communal tensions
years as a result of increasing nation
cou„t-ies, with the number or
Lsl.l ai.L«egr«fl=» m
”“^"9,o to IS oillion in 1993. The n.«o no
-K"S”^.-oVo::
-
the protection c_r
/*"
it-.s efforts to cr-rnnre
the countries of or taxt. „c_-—= - - u
,.J voluntarily and asstj7^ --e; ^
reconstruction_and_reconri 1 ' atxcn
allowing them^o^etur^hom^^elv-and
rhe process. Imor-oved g-chanisss M
levels are also urgently.
new waves
waves “—
conflicts before they
The international ^mmunitxjnust,^^
' ___
I.
Brincmo goverr^ closer to
the peonie
This
cringing governmentt.closer to people.
—
rocts
ant
-j
a
!
g
o
means
Zlization; promoting grass
160- Social integration
devolution and decenzr
of
j and new forms ocan take many forms: u.
•
1 arganixatacns
; direct participation;
non-governmental
pxivate corporate sector,
■ - • ; <authorities
and the
public
--partnership between
1
of
privatization.
including new forms <_
in the management of
a desire for change
indications
of
■to
citizens’ needs. Such
161. There are many
government responds
and in the way
institutions
ffectively
in the past,,, corre<'
public
t has done e£'
-those made
would
build
on
what
government
change
be ineffective. and abandon 13
that
have
been
shown
to
1practices
obsolete by time.
provides directuy a wide range of
administrative
considerable and complex
would
include
ocrh
and this group
simultaneously
to
there
is the need
humanize the bureaucracy.
qv-
162.
system to manage its e^ensi
older and newer market-b^srimprove efficiency and account.------- ty =
sgrvices is devolution or
efficler.cy,
~tp reconcile
L
More attention needs
should be orcaniced and
accountability a>.a .51—- y nn which services^
and jurisdictional
tn be
whether the errnas i
entities. The appropriate sc.!
~^77Tnd thj optimal scale varies
is on efficiency^ accoun a^i
suggests.no_easx
solution, but sore
and experience here cgul_d
reforms clearly have worj----- and, esoeciallYx local authorities.
.
one approach to_.? mpyovi ng —
ttyy
---
/-
-
I r
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163- >• common dissatxsza. —ion is that government services are "supply criven".
not be determined primarily by insextut ional rzer.
What .. provided and now 3,r.ould
--inter-uts that have v-c--. _^'jed access to government through
through formal
formal consultative
ccnsu-taz
The
"client"
must
Channels and through
networks.
not be lost tn a
bureaucratic maze and fnrta-d to take what he or she is offered by "those who
know best".
(
reorder the s-.sv~-c-:^ of providing public services in a wav that resocnd_s
v.c client" neee.s srrr at the same time meets the test of efficiency^—the
following measures z: rrnend themselves: the creation of so-called internal
?-,■• rkets " , when be-ec . ^aries are given the opportunity to' select among a
-7.-' d e r s of cooes and services; the involvement of
umber of public
ncn-oovernmental zksmUations in the design and delivery of services.;.... and
wesr-dino choice -.:--jyqh a ■■voucher” system, tried in severe 1.. countr ies at
national and sub-n.--n_.fnal levels, Other means include subcontract.^
s.-rvices to trivizs —
— ovleers
-z.z'O'/
Leers ,( setting performance tarcet.s—_c_—nub...-^,
entities and ir.Yc?.-_-:b citizens’ groups in monitorinc performance.
Sreatine space for civil sccietv
are met through different means and channels:
the
164. In all societies, r.e=
acrionc cf goverrrter.t, -- -J.fferent levels; the commercial activities of private
enterprise; and the inter: — ion of the institutions and networks cf civil
secietv, including
includi.-.g no.-.-cc-r-^rnmental
organizations cf many types, professional
non-ec
associations,
civic groups, self-help and community croups,
ons, trade
trace unions
union,
cooperstives and
informal ciroupings. The latter are distinguished by therr
and informal
often voluntary nature
z.n.ared interest.
165. In industrialized ccuurrcries many of the functions traditionally undertaken
by memters of the family, especially by women, the kin group or ccramur.ity, have
professionalized and are now performed by public or
been grscualiy organizes
—
Profit
and not-for-profit. In recent years attention
private agencies, both
‘
JS
institutions
of civil society, the community and
has shifted to the role
distribution
of
responsibility in performing these
the individual regarding z-.vtraditional
institutions,
including the family,
roles.
In developing
sometimes
eroding
and
therefore
losing their
are undergoing rapid ch~—s / --ability to serve the coc-Ltu_-ty
^cy in the discharge of caring, tsocializing ano
general support functions.
The rapidity of change - as symbolized, for example,
•fhe
by the rate of urbanization-: ixnd
^nd internal migration - in relation to tne growt..
of resources makes it impractical to contemplate widespread resort to the
—r period by the industrialized countries.
soluticns found in an earl—
a
naturally concentrates azc^rtd-on on the need to emphasize institutional
development as part cf the loader effort to maintain social cohesion m rapid.y
changing societies.
1 society can play an increasingly important role
166. Th-. . nstitutions of ci.'
zX-'.^viduaL
or immediate family and the government or
in med x
r.g between the ire
Many needs are met I through reciprocal
1 sector,
private-.organized czmm.erc
especially important where the population is
xgxr-d
are
i
and se'z-.-.elp arrangements .
new roots and has limited financial resources,
mobile, „s trying to estahl
It is important for ccvernEe^'/ especially local authorities, to encourage
1
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mutual assistance and
with community
self-help
a means of
resources.
s nrioritv for oovernmerr action. i s
mob i i i : g
to irorove
! sn
arcrepriat^rOrnate in wh
flourish.-- To this end, it ccn en
administrative P»ctice^that_tc^^^
thxpnnh specific prog^s^s^P
~
grass-roots oro^T-a mns.
-he r
to be highlighted.
Cooperatives, qte.se
rnnnrtun^ies, and reach out
^^tive
democr5^7^
organizations, deserve specie—. o~ '
K3nv different ^orrs
fostering democratic, particioaLinq
---- ^?r,n;rn toaethe7 producers,
cooperation have emerged in
of these grouts.
Activities
consumers, clients, or various co... i ■ - .
f 5OCiai services.
expanded into many^reaT envying a e.orL^-1^-------
V.
A.
KSAXS Or'lMPIXHCTTill-N AND FOLLOW-U?
Gliding orinrriolec for implantation
- - —-snyryg* of Acrxcn,
' i and the draft Progr
in tie draft Declaration
.tion
167. As emphasized
require the participat
— and interp-ay
---- -j cf Action have
social development and social progress : cf this draft Programme
The first four chapters
and other key actors,
of many actors,
* * ’ i and actions which Governments , ■ eliminating poverty.
identified a mix of policies
undertake with a view to
levels, can
These
operating at different
•
and enhancing social integration.
,
ar.d
better
eraployinent
although
creating more
r throuah social policies alone,
objectives
cannot
be
achieved,
however,
chjectives
and efficiently run social programr.es and
Sut/
well-designed, properly targeted
•
- role to play in addressing many socral neeos.
measures have an Important
i—l- oJablems is such that comprehensive ef
. o-r 'so'-ial
- to
resources
the nature and gravity
c- --- - in'economic policies, the allocation of
refleSed
address them must be i-----Central to the overall effort to
and cooperative alliances among actorscommitment by all the ma?cr actors^to
must be a shared
advance social progress
and pursue courses of action u.^at
nespent principles, acc
Also, the manner in which
--X well-being.
promote the common good and greater
relate to each other is of
of decision
in the Programme or
different actors and different centres
the frequent reference
undertaking of
critical importance.
This explitns
The cornerstone of a global
Action to institutional levelopcent.
both within
--g
actors
greater solidarity among
a
social
progress
this magnitude must be a sense m. .
a charter for
take
the
form
cf
f
or
social contract
and between nations.
It might
of the human condition, a social development.
global strategy for the betterment
global
compact
for
human security and human solidarity. or a
j with
members of society,
■> 6S
Equity and solidarity imply chat
benefit
from
their
the most vulnerable, 1
those who kre weakest, poorest or among
must
be
the most basic human rights
fundamental rights.
In all cases,
and different
also have varying interests
safeguarded.
individuals and groups
8 •
i:.—*
K
Ife
A/CONF.166/PC/L.13
English
Page 57
these cannot all be met simultaneously, a democratic pre rc-rs cc---.
herein agreement on a set of shared basic values provides*a
xt.on for establishing the needs and interests whose fulfilment serves the
r. -elfare.
It is only through a continuing dialogue among the key actors,
zz7z the people themselves, at both the national and international levels
~ 7. = ~ tr.e common good can be defined and, as necessary,
amended in the licht of
circumstances.
In addition, the consultation process offers the rest
~e = - =
reaching agreement on implementation requirements.
- r,e zzarting-point for establishing the foundation for solidaritv at. the
Level is good government. Public authorities should set the tone. ir.
pcli
end ethical terms, in a manner which encourages the various other
aczc rs z c assume their roles and discharge their responsibilities in promoting
-•elopment. The State plays a key role in shaping an enabling
er.v. rzr-.^r.z in which rights are respected, interests are reconciled, needs are
ir.ez ar.c responsibilities are shared.
3 7. = 1
170.
arts I-IV of the draft Programme of Action have called upon Governments tc
i r. ter
= provide a stable legal framework, ensure respect for human richts,
prezete er—_-al opportunity fcr all, especially in education and employment, put
■=“- end z.c zz -ure disoriminat_Lca, promote and encourage the crowth of
rt-pre can
<? c.rganlcations of the civil society, provide a framework for
u_alcg_a
negotiaition among interest groups, ensure me sound management cf
the eccr:
construct and maintain needed physical and social infrastructure,
design f
-ties and incentive structures that encourage enterprise creation and
employe=-~ -_r.tcnsive growth, improve the access of the poor to productive assets
and bas.z zarvices and assist them through adequate schemes of social
protect.
3ut while each of these fields of activity is crucial fcr procres ~
in the z
core areas, a Government ’s commitment and enabling role transcends
specif zz areas of policy action and institutional development.
It is reflected
i n the a :e-ruacy of resources made available and the willingness to reorder
budgetary grraorities in an appropriate manner.
It is demonstrated by a
in decision—making that adds up to a set of coherent, mutually
consistan
reinforcerm policy responses.
It is illustrated by a willingness net only to
ratify if
ration al Instruments in the social domain but co strive, to the
fullest e.r
permitted by national circumstances, to implement their
And it is manifested- not just by designing and carrying cut
provisic-.a _
p-r egracret
no projects but by developing a capacity to monitcr and assess
progress ~z:.'-•ards ths achievement of stated objectives and established targets.
171. Wizr_ r zr.e framework of a sound enabling environnjer*, private employers
have a may or role zx- piay in establishing enterprises, generating wealth and
ms.
They perform an economic function and have a critical social
creating
role.
Tn err.arz fully all their responsibilities, private sector entercrises
mu s t re.-; =
competitive by raising their productivity and channelling
-r.vestr. a
_7to the development of new products and improved production
retheds.
.employers also have a social responsibility to the larger
g^ve priority to employment considerations in economic
- - - - 2 1C' - - g and to work alongside local governments and members of civil
^ociery _ -. zaslgning and carrying out programmes aimed at raising the level cf
’^eli-beir. z __r. particular communities.
A/CONF.166/PC/L.13
English
page 58
Parts I-IV have stressed throughout the major role
a-h^ve
f rivil so-iety must play in advancing social progress and working to a---al Li ectIves. Their direct participation is essential in aefining_
Ljectives, setting priorities, developing programmes, designing ce ve-i
IvsIIms, mobilizing people and local resources, providing services,
172
monitoring and evaluating results.
and workers* organizations has been to
‘■■73. The hrrtorical role of trade unions
rful contribution to the definition and realization of sccral
LoqrIsLWein“defending'the rights and interests of . their members, they
In defending the rights i..
Under changing
Protected
the human condition,
ected the
the weakest
weakest and
and enhanced
c...
Trade unions also
c'-cumstances such
such a
a role
role is
is essential and must continue.
for
contribute to social
integration and,
social integration
and like employers, have responsibi-i-.-e
LLLeltlon of an ethic of service and the definition of the common good.
an ethic of i— -
174. Community groups c^n take many forms, ranging from organizations o.
f
smallholders and urban-based community development organizations
croups.
while their specific interests and tasks may vary consxoerabli ,
.
•
links between government and the grass-roots m raising
and pto'erS setting out the true nature of particular social problems
<
and’-'-an he* ping to shape responses that address the felt needs of the
tne cc
u-.-y
Evolved. Among the types of tasks carried out are improving access to
markets, irrigation systems, basic education, primary health
tea--.. —*
cf —
r -f- a"“
bousing, participation in thei planning and carrying out c.
ccnserration efforts,
and
protecting
working
children
and
other
vulnerable
efforts, and protecting working children
—----
croups.
important role in assisting
--- \ local
often can be enlisted to design and
initiatives- Non-governmental organizations
But as many n on-go vemmental
deliver services to local communities.
clienteles, larger community interests may
c-can-5 zations work with very specific
------Lit b^ served through partnerships and coalitions of non-gove™
organizations formed to address complementary sets or - broader
L----- range of
c
community needs.
oS2
17S.
^nd cross-sectoral approaches to compxe~
ess-
wider dissemination of
• ■■
to let.1 xnit.txt. .nd
. • „
•.
.ool.l cotditton..
an levels between government and the major actors of civil
C £4 the latter
and le.tltetloes, eederple. th. e.,y
/--•
J
I
A/CONF.166/PC/L.13
English
Page 59
(
notion of a global
for social development and, in a sense, is tn.alobal strategy
stjratGgy foT
es:.ence of social progress. Examples of areas where such cooperatio.n _s
essential include designing policies for the eradication of extreme poverty;
planning for the employment effects of new technologies; building better bride
bet-GGn educat ion/training and. employment/working
ovraent/workina life; addressing tr.e
institutional requirements of a broader conception of work and employment anc
native life—cycle patterns; protecting children and striving to
rsssively abolish child labour; eliminating discrimination and achieving
ecuality in the relationship between women and men; and protecting diversity
based on shared values. The realization of the Summit’s aspirations and the
sustainable implementation of its goals will depend on the involvement and
efforts of people everywhere, working within their communities.
It is therefc.a
necessary that the various actors support, in particular, the development of
education initiatives at the local, national and international levels to equip
people with the kind of knowledge, skills and attitudes they will need to
participate actively in furthering the Summit’s aspirations and goals.
178. There are instances, however, where a significant divergence in interests
greatly reduces the motivation to cooperate, Where cooperation proves
difficult, it is important to foster the use of mediation, arbitration and other
consensual forms or conflict resolution. A charter for social progress anchored
by the principle of solidarity would require weli-cerined, generally aocepteo
procedures for conflict resolution and problem solving.
179. A Global compact for social development also would carl for much greater
international cooperation and support and a major unxrxed effort by the un.rtea
Nations and the United Nations system. Parts I-IV have pointed to a
non-exhaustive list of areas where the Untted Nations ano rto specie^—ed
agencies can clay a heightened role. These include eliminating all terms of
discrl.t.l.nation, conducting research on the causes and rer.ecies of poverty,
carrycn? cut emergency relief, strengthening techncrogy institutions an^
policies, enhancing education and training programmes, improving job infom.o.tic:.
for workers, and promoting the ratification and fuller implementation or
international instruments that safeguard human rights, Eut going beyond what
individual United Nations programmes and individuals can offer in these and
other areas pertaining to social development, there is a need for a more united
thrust running across the system and greater isibility in the treatment of
social issues.
ISO. There also is a need for greater dialogue and cooperation between those
organizations with responsibilities i: the e-—omic field and those with a
social mandate.
In addressing the three core issues, the report has shewn the
close interrelationship between econcnic anc soctal forces and associated fOxicv
formulation.
Social objectives can only be achieved if supported by economic
policies chat are equitable as well as efficient. A strong "social pillar” m
the international community calls for a careful blend of the economic and the
social, linked by a commitment to achieve the objectives established ler each of
the t..r. e core issues.
F
0
A/CONF.166/PC/L. 13
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Page 60
E.
Implementation and follow-up at the national level
central priority of 'social progress and to achieve the
181. To reflect the
Cover nr e r. n s
the three core issues of the Socia. Surrmi-,
objective s related to
Countries typi ally
national strategies for social progress,
ought to elaborate
education, health care
strategies
for particular sectr-s - housing,
develop
with special needs, such as
examples - or for groups
social protection are
But the policies and actions required to achieve the
unemployed youth,
should be extremely civersi f led.
objectives in the three core issues are and
-sectoral or global in scope.
Certain problems call for actions that are cross which have economic, z inancial.
Policies for social development relate to issuesNational strategies for social
legal, institutional and cultural dimensions, sectoral, issue-oriented and crossprogress should therefore integrate separate
sectoral policies and strategies.
.
£*■
182.
in accordance wi^h the orientations and sidelines of^hehdraft^eclarat-on
conditions. Na^o-.a- Su.-_
elaboration and imolementatron.
include.all -e^main^societal actgrs^therr^labora^on
me envisaged s^-.-^es .
social planning
without sacrificing their focus on
would cdtnprIse the integration of
legal dimensions and measures.
: national strategies, specific programmes would need
1=3. Within the context of
Iccal.
conceived and implemented at varioi13 lev^^ 7 ^e^i^the^rovision
cf a
to te c----is
p
The responsibility of national and regional authorities
of
ccrrmu.
“iby
services and facilities to meet a wide range
variety of options.
help
set
rr.ore
' *
» can
a^'househeld needs, while local and community institutions
Strategies for integrated1 service
specific priorities at the local level,
place at
Such integration can take
1
delivery should be reviewed and explored,
service deliver^
1 managerial levels or at
administrative, planning, policy ano i
weak, it may
are administratively
i----points. However, where political structures
st_resort
to
simpler
delivery
mechanisms
well be necessary, at least initially. to
---- » should also include national
184. National strategies for social progress
appropriate, and a
targets with an indicative time-frame, full costing as
draft Declaration and the draft
m-'thanism for review and revision. Tne
the elimination of the most
Programme of Action suggest precise objectivesj for
3 of discrimination and th
elimination of all forms
extreme forms of poverty, the i----Targets are
and
justice.
Taroets
reduction of inequalities of opportunity, access
mobilize the
precisely,
to
useful instruments to help define a problem more
-lend transparencyr to government
energies and resources needed to address i , to
Transparency and the creation of the
co'icies, and to ensure accountabilityrevisions of targets impl'j
analytical and institutional mechanisms for possible
domains in which nations
an efficient monitoring mechanism. This is.one °
through the use of
Governments may wish to share experiences, inter ai.a,
and the United Nations system.
institutions of the United Nations a.._ —-
■
F
.
I
;■
A/CONF.166/PC/L. 13
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Page 61
185. Another aspect cf government action to implement the recommendations and
commitments cf the Social Summit will be to build, review or revise the
institutional arrangements conducive to an integrated treatment of the corb
issues and their common elements, including the element of macroeconcmic
stability, as well as new and more comprehensive approaches to governance
involving ether less traditional partners, such as the private sector and
non-governmental organizations.
186. There are many possibilities for promoting policy coherence, ranging from
inter-ministerial committees to planning units attached to the office of the
President or Prime Minister. While a functional division of responsibility
within government and within the public institutions at various regional and
local levels is imperative, integration should not mean "deprofessionalization"
and confusion of roles. Equally imperative are arrangements and procedures
through which each decision of a sectoral nature can be taken with a knowledge
/ f other related decisions and of other sectoral and cross-sectoral objectives.
\. ecentralized forms of governance and local government have a crucial role in
facilitating the implementation of inter-sectoral strategies comprising a
holistic approach, and supporting a participatory role for the community and, in
particular, the underserved population.
187. Essential to success here is the administrative cr institutionai culture
which imbues the relationship between persons and departments or off.1 c.es with
different responsibilities-, if there is a snared perception in a Government, cr
in the local administration cf a city, that a problem such as the elimination of
poverty has priority, issues of coordination and conflicts cf competence will
not become dominant enough to jeopardize the achievement cf politically accepted
goals for social progress. At the same time the status cf ministries and
administrations responsible for "social issues", as a general rule, needs to be
upgraded and integrated, into the overall development and structural adjustment
decision-making precess. This a Iso applies to the vocations associated with the
delivery cf social services and with social protection.
In that sense again,
there are strong cultural links between perceptions of roles and what is valued
in a particular society, and society’s capacity to address social problems.
>.
■-
Ik
»■
Tne overall monircrinc of the national strategies for social progress and
more generally of the irnpiementation cf the goals, objectives and
recommendations which connt-itute the outcome of the Social Summit should be
primarily dene at the namicnal levels The results of monitoring would make an
important coittribution to a national debate on social questions and enhance the
capacity of all actors at the national level to participate effectively and
responsibly in the pressss of social, development. Exchanges at the political,
intellectual anc profeaszonal levels should be stimulated by public authorities’
organizing open duscxi&sujCG« on the implementation of the Copenhagen Declaration
and Programme of Action. It would be useful, again for the purpose of learning
from the experience of others, if the results of the various national monitoring
exercises were brought to the attention of international forums.
The
arrangements for such international exchanges are discussed below.
I
/...
iA
j
•j.
r
A/CONF.166/PC/L.13
English
page 62
c.
International cooperation
for social progress
to
289. An iinportant objective Of the Summit is to
social progress of rnternatronax coope.“
Accordingly; ;the^expansxon of^coop
ig encouraged and all actors
channel and forms
“rShtiiillnUi.Uy
th. ...ret to.
invitee to xntensixy^
use t
potentxa o:^
cf development cooperation that meet t e i._
as
-x-- official and prxvate, multinatxonal and
*
cooperating partners • ~
people themselves - individuals, families and commun .well as of j
increasingly essential in dealing -with
“»S0. Cooperation among Governments is
promoting reproductive heal^n
social issues that transcend national borders,
oread of diseases, including
and responsible parenthood; conta^ning*1 ( and assisting migrant workers ano
HIV/AIDS; regulating migration
and
g organized crime are among the
,
x^_fprotecti
fickina and
rganized
and
controlling
drug
tr=ffx
some caseSf bilateral
Q
refugees; *-In some cases,
mere prominent
multilateral approaches
arrangements may
voice in decisions that
to be encouraged so that all countries have «
them directly or indirectly.
: into existence in all
subregional groupings
political, cultural or
world in recent decadesf orxarnaning
trade, provide furtner
Members of sueh
croortunities for cooperation m the serial spne •
for deepening cooperation
o'roanizations are invited to explore new
ion in the security and
on'social questions to support and complemen. coope^a.r
economic domains.
-t cooperation on many socia^estio
192- Government-to-gcvemment
, c- --^rLXxS^c^akers and other government
international exchange
valuable
natxo**ax
H^t-wpen d^nor
are recognized as ithln the to
social area, bilateral cooperation between O-..O
services of
experts. Also, w , and developing countries aimea at Pr^^ggources
(
oovemment agencies
benefit to the poorest, is of
^rposes.
To facilitate
therefore, need to be directed
to more effective both developing countrres and
assistance
this shift and to t--- modify
i -r -approaches and proceoures.
donor agencies need to
attention needs to be given to ways of
193. In developing countries ssore
• • —j through the establrshmenu. -a.
achieving greater coherence 1=
cooperation
Messing
overall assistance needs at the country
consultative mechanisms for “earLg-r.ouses specifically for coopera^on
level, which can also serve
activities in the social areawill be facilitated if
community, set up or enhance
I information that can be used to
national databases to provide baselxne
the data
achievement of the goals and ob^ectxves
measure or assess progress towards
international documents,
of this Programme of Action and other re-ated
commitments and agreements.
/...
I
A/CONF.166/PC/L.13
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Page 63
i
cooperation agencies in donor Governments should seek to
195.
-;
oser
links with all relevant developing country ministries,
establij :
-*OSe o^ social welfare, together with their provincial and local
indue ■- ' ^—'s/and draw more on national professional expertise in the design c.
counter
programmes. Government support to national capacity-building,
cooperaz
=->*er
involvement in international exchanges and in the specialized
through
Frograrrmes and
training z- personnel from developing countries, is recommended.
'
- be expert-intensive and
activir i -a- -ene^iting from external aid tend to
“their viability on outside resources. More attention is needed,
dependent
of project design, to ensure that they lend themselves to wide
at all s-.a.ces
z- at much lower "unit cost”. More attention is also needed in both
replicaz ■_
-- ^d donor countries to ensure that projects are designed with a view
develop z..
LLz sustainable forms of financing after donor support ceases. Thus, m
to assur_
Zc-restments in the social area, both parties need to consider mtre
r’-ciding
( refully —maintenance costs involved and the sources of funds for recurrent
expenses, especially for staffing. At the same time, programmes,could be
cere effectively with a more flexible approach to meeting local end
supported
recurrent crests, which tend to be particularly important in the social area.
f__ j are time-consuming and place a heavy burden cn
19 6. Curra-“ doner procedures
cevelcning
countries,
which ministries of social affairs fxnd
personne1
~-*f’
cult
to
shoulder.
There is a need to find mechanisms for
especial
-^rJZbllxty and accountability for action in programmes that cut
across sac "S or that involve more than one partner.
Tion to international cooperation among Governments, cooperation is
197. In nr
oro non-governmental organizations and other institutions of civi.
extensive =:
-Is nrade unions, the cooperative movement, professional and trace
society, rz
Such
7 academic and research institutions and many others.
Such
asscciattm.
i
of
shared
Interests.
_
e
typically
the
spontaneous
expression
cooperate zn
- > such private
efforts in a variety
:
Government~ man help to support and encourage f
erect
barriers^to
mutual assistance
x of ways, :=- —.ing by taking care not to c Governments can often assist the
society,
< f' corts j--- _XiStitutions of civil
'
t
visa
and currency formalities, or by providing,
L z-cess by simplifying travel.
policy guidance, and technical and financial support.
in special
sroltc-;. social experience and social analysis offer an immensely
198.
It is often
ri."- - ~-or~exchange, dialogue and joint thinking and action.
useful
It is,
^.zary nor desirable to attempt to plan such cooperation.
neither neo
"market
for
-- ameiv important to create a climate favourable to a
however, err
l^lrning from experience on matters of social development.
ideac" and
of a "Youth Voluntary Service to the Community" at the world
199. The :
Lcn of a* Il'^ nnder the" auspices of the United Nations all
- oe considered. Under the auspices
level shoul.
_. - rf be invited to legislate the
the creation
creation of
of aa service that young men
countries
be .nvite
CommunitieS would be
—
join fcr a period of six months to a
^f^^r-Z^^r^there was an expression of interest and felt needs, and they
where there was an expression of interest
T '1.
H to narticinate in the design of worthwhile projects and
323^uraged to participate
activ4^“ "countries which have a military conscription would be i^^ed to
‘
th^s service to the community as an alternative. Count.
C™’i=:r
'mtly conscription vonld 0. invited to .st.Ollsh such .
po^ii “oiiia 9.»«.Uy
in tn.lt »n oonntci...
/...
''
r
'
>
■
*
A/CONF.166/PC/L-!3
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Page 64-
■ ; would be established for servioe in
machinery and possibilities
... developed and developing.
^^Jti^espcnse, t= instil
the world, both
unexploited potential of a powu-- t;ffies givino ther. the
fully on the
a sense of service to the community, at tyes g
s.^h
in young people work and live with people of oth^ *^o^o^°cen=e and adulthood
opportunity to
q-eater sense cf
voluntary service would facilitate the passage
and, when ‘
solidarity
for.s
D-
.m -»«
~ “• »«>«—•
the United Nations sv^te^
The role of the United Nations and
. .
.
TY international Economic and Social Ccccer=x
200. 20 MU... »
““o“.he. •
r.LU—.
the Charter of the uniue
Keener" and ’’peaceful and rrie-- _•
between "conditions of _staoiiity ^-JTArticle, the Charter states that the
relations among nations". in - . -y .
„higher standards of living, tun
United Nations shall promote, i.
social progress and development",
employment, and conditions oy. ic
scions of international
The United Nations is also ^equeste
•
international cultural and
economic, social, health
for, and observance of, human
educational cooperation , an., y
* re1 ates to the establishment c-f
rigM. .nd
4 Xwla
v,,-..d m-um:S. —
^recialited agencies and to ahei- rela
..mwradiiists far bhe
shall Tnake recoittendatio..s
Article S3 states that "the Organization
and activities of the specialized acenczes’1.
coordination of the policies i------------' rr the specialized agencies for
,01
The mandate of the United Nations and of In^rnational cooperation on social ^^XXnnents tove made of
4
4
;.:
fc
-
iW
feO
g
>■1
therefore extremely extensive. •'secretariats to
to assist
assist Member
Heater States
States y.
r»rT theduring
oast qs
—cSmandate, and the capacity
domain have _
varied
the—apast
domaxn.
promoting cooperation in
in the
the social
soci
,
aoencies and programmes on
In addition to the activxtz.es oi spe Jtjctpu‘’atxion, refugees and the
employment, education and cul^e'
' ^/t^dency in the United Nations, r
situation of children, there hy been a
and programmes. As a<_
since the 1990s, to "integrate" social and economic^
itE original
consequence, the concept of
=_- in^mational cooperation
moonina
In
a
scnematic
manner,
sc^^.a^
.
—-.^-ed as foklcws:
for social development in the United Nations can oe 3^r__ed
mm
.(s of the General Assembly, the Economic and --Committee
Commission for Social Development,
n specialized bodies, such
,b) Comparable but sectoral discussions in moyStatus of Women, the
the
as the Population Commission, the Commission a..
on Crime Prevention and Criminal
™tssion on Narcotic Drugs, the Commission Poverty Alleviation; °ccasLCr';2__
j“ce and the UNCTAD Standing Committee on
the framework of the progr^— es
debates on social aspects of developmentyithi..
leading to the negotiation cf
of the regional commissions; and-discussions
I
ft-
M
t ;
Bi'
rli' •; •
Pl
i ' ; vi
1
Uli
A/CONF.166/PC/L. 13
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Page 65
relevant paragraphs in intergovernmental texts, such as the International
Development Strategy for the Fourth United Nations Development Decade;
(c) Discussion and adoption in a special ministerial conference
the
Guiding Principles for Developmental Social Welfare Policies and Programmes in
the Near Future (this is the most comprehensive text on social development
endorsed by the United Nations since the Declaration on Social Progress and
Development of 1969);
Snecial events or years, such the International Year of the Family
and
decades, such as the United Nations Decade of Disabled^ Persons, and
(1S94),
the International Decade for Natural Disaster Reduction;
Cd)
(
\
(e) Technical assistance, including expert missions, workshops and
projects:
for social welfare and social integration, including activiti.es
relating to youth, ageing, the disabled and women; for institutional
development, particularly at the local level for decentralized social welfare
services, grass-roots organizations and other elements of civil society; for the
formulation of social development policies, plans, programmes and projects; and
for the development of income-generating projects, particularly in rural areas,
with an emphasis on community participation and the learning process;
(f) Intervention by the United Nations system when’man-made disasters
create conditions of great disruption; the movement of seme 50 million refugees
and internallv displaced persons eventually generates, beyond initial
humanitarian interventions, the need for reintegration efforts.
In these, the
operational arms of the United Nations system, the Ofxice of the United Nations
High Commissioner for Refugees (UNHCR) and the United Nations Children’s Fund
(UNICEF) , and the United Nations Development Programme (UNDP) and the
specialized agencies for the longer-term development dimension, can serve to
assist countries in the process of assimilation and social adjustment.
2C2. In their specific social domains, the activities of the specialized
acencies and of United Nations programmes are more comprehensive than those
enumerated above for the United Nations. In particular, they include
preparation and negotiation of international norms, regulations and legal
instruments, most notably by the International Labour Organization (ILO) and tne
World Health Qrcanizaticn (WHO), and more intensive advisory missions and
tec hr. i rs1.
' stance activities carried cut at the national level by the
relevant agencies in such areas as education and culture, health, population,
children, employment and working conditions, drug control, food security and
human rights.
social cooperation through the United Nations
203. The scope and priorities for
g
j
the
basis of a comprehensive assessment of social
system should be determined on
of the anticipated needs for social cooperation
conditions and an analysis
i
pertaining to the three core issues and their common elements.
A few preliminary remarks can be made:
The United Nations, particularly the General Assembly, should Keep and
(a)
social development.
development
enhance its role as a forum for intergovernmental debates on
-■.............. ,
*
P’-'
A/CONF.166/PC/L.13
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Page 66
full political debate on questions sum
and social progress; the importance of a social integration is a basic point
as the elimination of poverty or greater
-----j cf Action; the terms of
made in the draft Declaration and the draft Programme
should
be reviewed; the possibility
* reference of the Second and Third Committees t---- - ,t in the Second Committee
cf debating questions of economic and social developmen in the Third Committee
of_ human
rights and humanitarian affairs
and questions g
..
might be considered;
(b) A closer relationship could be established between ‘he Seourity^^
Council and the Economic and Social Council; Article - - "
that "the Economic and Social Council may furnish information^ the ----- .
Council and shall assist the Security Council upon its reques. .
■debates and exchanges of experience on very concrete aspects of the e.abo.a.xor
and implementation of Social policies and programmes;
The critical role of institutional development and renewal in the
tatior.
of policies in sectoral or
functioning of societies and the implement
—
and the
overall social domains is also increasingly evioent- The United Nations
cooperation and
United Nations system have scope to increase their
1---- technical
(d)
assistance in this field;
the various
The mandates, agendas and modes of operation, of
indirect
relationship
to social
‘ha direct or
organizations of the system with
core issues - should be part of the
development — particularly the
1-- three
-•
The
'
'
r
a
number of programmes and agenciesinternal review already launched by
- • • \ Economic and Social Council and its funcnxcnal
respective roles of the L------ —
commissions should also be reviewed. The aim would be to enhance the
coordinating and policy-setting role of the Council whxle ensuring that
subsidiary bodies provide appropriate advrce.
*.<e mandate "
Social Development should be reviewed in the light or tne mand= e c.^n.^^^
Icng-standing commissions and committees, such as the Commrssr
of Women and the Population Commission, as well as in
- ;; ^;_ion
of the newly established Commission on Sustainable Development
Consrr^a
needs to b= given to ways of expanding the role of the
-------society in the deliberations of the Commission on Social Deveropnren ,
(e)
(f)
The governing bodies of specialized agencies and programmes could be
unUiVu*"a “■
of giving higher priority and visibility to social de-e..=pmer~;
policies and priorities as agreed upon ir Copenhagen
^gra^mes
coordination of the relevant activities of the Unx-.ed 4.a.i^.-_ i-s - v
and the specialized agencies, such as tne
L^n^er^Us of the
intended to provide tne framework for
..ed <-owards social
United Nations system, could be more spe~ — x
y
objectives.
to
205. Although the precise monitoring of the recommendations to be adopted^n
Copenhagen should be, as noted above, undertaken at the national e *, “Jov'erall monitoring of social development and social progress shou- /...
J
(
5
A/CCNF.166/PC/L.13
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Page 67
to the United Nations and the United Nations system,
considered:
A few points might be
(s) Global monitoring by the General Assembly on the basis of an overall
report of the Secretary-General, which would replace the current surveys and
reports on economic and social trends and issues;
(b) Leaving unchanged the monitoring and reporting roles of the working
groups on the Covenant on Economic, Social and Cultural Rights and the Covenant
on Civil and Political Rights;
(c) Convening by the General Assembly, approximately every five years, a
world conference on social development and social progress; such a conference
would be held at the ministerial or summit level upon decision of the General
Assembly.
2G6. UNDP could provide focal points in its country offices for follow-up to the
World Summit for Social Development, which could assist Governments in their
endeavours while also facilitating communication between the United Nations
system and each country on Summit matters. UNDP also could assist Governments
in organizing, at the country level, annual Summit follow-up meetings of the
major actors, including representatives of governiBBnr and key segments of civ - 1
zcciet-.-.
s
207. The organization and structure cf the Secretariat of the United Nations,
whLch has a central role as a forum for exchange cf views and policy-making on
ment and social progress,
progress. should be modified and
matters of social development
strengthened in the light of the decisions of the Social Summit, Currently,
coherence
and visibility. • The United
there are problems of overall capacity, c
--Nations must provide the “social pillar" for international cooperation. A
rearrangement of existing resources, structures and mandates should make this
possible.
208. A possibility would be to have a number of programmes on issues stemming
from the Social Summit. These programmes
prograirjnes - on social integration, the reduction
and elimination of poverty, and the relationsnip between the globalization of
the etc .ctuy and employment — would aim at morilizmg the relevant activities cz
the Secretariat a-round, precise themes and objectives within a time-frame. They
would ire identified in the programme budget and the medium-term plan of the
United Nations and could become the subject ox specific inter-agency
arrangements for cooperation and coordination. Programme links would have to be
estah_.sr.ed at the national and, increasingly, subnational levels so as to
effecz_'S1- utilize the field presence and ensure the necessary coherence and
follow-up by the relevant United Nations programmes and specialized agencies.
E.
Mobilizing resources for social develccr.ent
209. S ..rial development requires first the mobilization of all available human
and p.vsical resources. The fact that poverty, and excessive inequalities,
represent a waste of energy and unused human capacity has been emphasized m
this draft Programme of Action. The reduction of poverty is an engine for
/---
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A/CONF.166/PC/L.13
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achieving economic coals. Also, education and health, in addit-on, to b
facets of human progress, represent necessary investments for the realizatrcn o:
all the objectives pertaining to the prevention of poverty, access to empxos...ent
and the enhancement cf social integration. A good network of institutions, laws
and regulations, and their functioning according to democratically acceptec anc
enforced "rules of the game", as well as codes of ethical conduct, constitute a
most valuable and necessary resource for social development. Anc, ultimately,
the behaviour of individuals a_ members of a community and citizens cf a nation,
is the decisive resource for social progress.
210. The question of the financial resources needed tor the implementation cthis draft Programme of Action should be approached first fromxthe national
perspective of Governments. Some remarks are in order:
(a) The issues of poverty, unemployment and underemployment, and sms
integration, are not "sectors" of governmental action and do not necessarily
fall^under the responsibility of particular departments and ministries. Rather,
they are issues which are at the core of the development process and require
very diversified policies, as well as the interplay of many actors.
In that
sense, financial resources for the achievement of the objectives of this c_=-t
Programme cf Action cannot be separated from, and must be an integral parfinancial resources for overall development- Currently, in most deveiopxrg
nations, these resources are insufficient;
(b) In allocating public resources among the different domains anc sectors
of activity. Governments always face difficult choices- However, the literature
on public expenditures provides sufficient guidance for making economica-_y
sound expenditure allocations in such areas as educaticn, health, food
production and food security, and the physical infrastructure of a country.
What would seem to matter most in the political process of
of rseeking the general
interest through allocation of public resources is to have as much knowledge as
possible of the effects on the living conditions of people of expenditure in a
particular domain, including both short- and long-term benefits- Information,
statistical data and analyses of the results of public programmes and projects
and of their linkages are therefore important;
(c) There is a close correlation between the functioning of a G.ovex~nment
and its administration, and its capacity to raise financial res-—.ces co
development, both domestically and imrernationally. CredibiLt-y, t—cnsp?-2..-; ,
overall accountability to the people, and the capacity to avoid corruption and
to limit the extent of wasteful expenditure are critical elements fox the
~
efficiency of the taxation system, as well as for .the mobiiiz&r-tn of external
resources.
211. Both UNICEF and UNDP have been advocating the concept of ■'20/20’’, which
calls on developing country Governments to devote a minimum of 20 per cent of
their domestic budgetary expenditure to human development priorities and,
similarly, encourages donor countries to allocate a minimum of 20 per cen~ c f
their development assistance to the same priorities.
212.
In the Human Development Report, 1994, a proposal is made for a ”20/20
Human Development Compact" to implement targets for essential human development
c-' I
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Page 69
neriod (1995-2005). Developing countries are invited
over a 10-year develops
Qf their budget to ’’human priority concerns -.0 devote at least 20 J®*
education, halving adult illiteracy rates,
These wall be “=^°t°o, ^llz elimination of severe malnutrition, family-planning
primary health care
ior couples, safe drinking
water and sanitation for all,
Z^illing
drinking-water
services for all wx.ling
ePtimated in the report that the implementation o.
l
, ‘--and creoxt for allall- t is.^
en ' aa an average pattern - would yield apprcx-r.a^ .
target
seen
this 20 per cunt target
facet of the 2O/2C Compact is the prcposa- tn=c
-ear.
-he
$c58 billion a year.
Ti*
0 other
°
_f .'nei- aid budgets to the same ’human
20 per
donor countries also devote
devote 20
P^^-^^'^g^uocate 16 per cent of aid
. estimate here
priority goals’.
xhe
^vsn
cent to -human priority concerns . A
per
to the social sector, but
but only
.-y_-seven
e3t.^
ated, provide S12 billion a.year, instead
move tc 20 per rent wou. , Therefore,
eforS/ the
the 20/20
20/20 -compact
"Compact for
for Human Development
cf the current S4 oixlion.
cnoneib'litles
”
between
developing
countries
Sharing of responsibilities" between e_
WCuld be ’based on a sharing of ^°t no new money would be required because
The
report notes
that no new moneypossible changes in the
and the doners.
The repot.n
a
u-»
-i ' p'n wouId be restructured•
suggested in the repor*-.
budget’prior it ie's of
of 'developing ^“^riesjre of "loss-making public
Znuerptises-ZS^Xtion^f^^priority
itary
development projects
At the Int
7
vhll.
rhose human development priorities m ccun^i
ub.r.
o
•czken the lead.
"".s” —».f. £o,
account the following orientations:
(,■ Exists mechanisms in place for stock-of-debt operationls snould be
-> reducing the cerr of
- 2 ilTL-,.-ly and flexible manner with a view to
leasx developed m1nrr2.es.
dlvelc^^g cobles, especially in Africa and other--------
co a suszainable xevel;
(M
0.7 per
valr Zs
The
for offieL.1
national product
implemented; the situation
a matter of
„n
r—lo.
o..a -
(c) There Ss
reased
solrda^rc-ty
rr.c
c entries. One ot spiritual, grounds;
-.^idaricy in -j^ical and
--t and future state Of the
’ ms which affect the current
economic or political but have in
(d) All -he cr-iestio
not specifically social, c--------and v/hich are i-_
/...
i
ii-
fl1
-.x;
I
A/CGKF.166/PC/L.13
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Page 70
t-ho rb^Sc-er’ Stic of being universal in their effects xf not xn tne-_
S„=h issues are *«. to t». e„v,ren»e«. th. HIU/MPS
■
on a variety of international transactions. The Human DeveloA^^^
includes a discussion of such possibilities;
rganizations, consideration shout
(e) Within international and regional o
reallocation of resources around some priority objectives relates
be given tc a
be taken in Copenhagen. The notion of
’ l of the decisions to
to the implementation
to the more administrative modes' of organisation
programmes, as an alternative
«
United Nations, would go in that direction.
mentioned above for
1-— the
-
■ j the role of the private sector for the mobilization cr
|
215. With regard to
social development, the following points need to be made:
resources for i---in that the essence o *
(a) The private enterprise sector is a major actor
—tunities and
its function is to mobilize savings, seek out investment tpport
A sound enabling enviromr.enw
■--=ate wealth through value added in "production",
the performance of muiciple
and the right incentives facilitate and encourage
roles by the private sector;
ivate sector
a osjor source of goverr^eot revenue, ac
(b) The
free whirr, public sector prcc-arcr.es, iflCxud-.g so-..
national and local levels,
IntemationaUy, it provides various conduits ,or
nrograrrires. are rananced.
to the places where they can he used er f ic .e-.tiy . It c^n
channelling resources
critical partner with Governments in realizing social objectives;
thus be a
eect=r, in particular major national and transnational
of
corporation:
also be effective in mobilizing resources for the promo,
s-ec^f^c social objectives and in tackling a range ox problems
One
f
Ernstssrsrs.'•
efforts to meet many social needs. .. y
•rlir.n free of charge, their
encouraging employees to volunteer ana y pr
facilities for raising
organizational talents, technical skil s
levels should encourage and
funds and delivering services. Governments at axl revels
make use of these capacities.
I1
.i ' 7
■■■
■
’
A/CONF.166/PC/L.13
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Page 71
for development need to be mobilized also by combining the
216. Resources
-he public sector and of financial or capital marxets, nationally
efforts of
internationally.
the national level, development banks and similar institutions that
their
capital base from the public sector
sector or
or ^re
^re in ether ways
deri’-t
of national authorities.
unde r--;r i 11 e n by government, need the sustained support
217. A
2^3. At the regional level, such institutions as the regional severe ...en. b_.—
have the potential for mobilizing new resources by combining the.funds
subscribed by member Governments with their capacity to raise private cap----“eX;ll and'global financial markets. These banks have also pioneered
‘XessLnary lending to promote social objectives.
They deserve continued a...
enhanced support.
21°. At the global level, the significant role played by the World Bank and its
i-s supoort to national efforts to eradicate poverty and to meet na.ior.ai
objectives in various social sectors by expanding both its lending <xna .ee...- = 1
advice.
The Bank's capacity should be strengthened to allow it to mctni.e
additional resources for lending far development and m support, p=----- —.
of the objectives of the three core issues of the Summit.
most
220. The Interr.aticnal Monetary Fund should continue --o explore
.....
-y
yDrcrariate ways of asaisxing countries tx> ensure macroeconomic sc
ck-a^ using foreign finance, which are born essential xor .eng-.err. e----- c
the
social cevelooment, while giving specific attention m its operations of
social dimensions which should be integrated into macroeconomic proc. =u.-..= adjustment.
Nores
1/
See document A/47/277-5/24111 of 17 June 1992.
I
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i
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A/CONF.166/PC/
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li..:
-: ana zr . :;7 3 C - - •' '■ • -'LL c
_’Oc a £ £ :
at human and environmental resources can ba mu*.~z
from Agenda 2if me _~p£-'••■■To ■ice just one example, drawn
<2 f cooes and serv lc
it—■*/
f forests can increase the production
forestry products, thereby ?-.eLpr:-::
t.'.e vield cf wood and non—wcco
well as additional •■•alue threuer
icional employment and income as
nd trade cf forest products.
h.-,- "-B^it^Llern^Ttr^lvekhcok^iZ^^ile ecoevsterZZZZIHZ_
Tnd .-eaene^ion of ^Z^IlZZhectec^Zful^^
srefA- and natural resources should be enccur^.
31,_ yor an increasing number of developing countri.es, expo
£ generL ooennees
Z dynaxic role in economic growth and
(
. .._.
ahczor-binG 1 arce numoers c*
t“:y:».«=«
s, mH •=
level, rlslag
-
atv.„lly
...
’.»• tre=«n.
r-..... .-^rc and Sievers should
fl^tace in theXXtiti^
rea-.^^ t-.err
^.rkerpla^
; r.CT
while extano-ro .....
•
114. nit-oripartire
potential
szeel and shiccui-crr.g
.--■.-/ant to other declining industrres sucn -s
r.lchcugh
ccr.secuences of mcustria-
defence manufacturing where tne emplcyment
iu is
The pr.asmg out or crccuczrcn
are perhaps most pronounced today.
conversloh
i economic and employment impact
of a plant can have a concentrated
zotal clcsjre
Workers r.a? face the prospect of
particular local community or region.
(
cn a
long-term unemployment.
1---
adequate levels of
Wni 1 e labour mobility, retraining and maxntar'-..r.o
- facilitate receLlcvrejn—
hl-h.-.ion should be used to ease the taraer <--t_
eememi c a 11 v
t
,,... ....--kr-ro , tfers also, should re
'•eu profitable u~es chh —aticnallv feasible, to f ind^ altemat.axe
iew to minimizino labour
available al art- ooutor.ent a-.d «k<~ils, uif.
dir icr -tiicn ano skill wastage. <
115. ovee .me •• ..ml.e-em. — - “J ’
--■
service
consider*
werk-z-d
“r”
m
-X —• and much
offers
jets.
adjusting
u°2‘;.:
«<
- J LlLlm b=u.-.
. .-.re highly skill-intensive, ---- rc— ^ility imtrevements , shew rising pre--^--
■--?•
/...
.--r’
VW
SKILLS for PROGRESS
Concept Paper on
Developing Partnerships between vocational /technical training institutions
and Business & Industry
SKIP is facilitating an exchange of ideas and information about the important role of education
and human resource development in preparing workers and their companies for the challenge of
competing in a technology-driven, global economy. One of the ways this is being achieved is
through discussions on topics of common interest between business, and industry and training
institutions. A workforce development roundtable will bring together private-sector
representatives, educators, and senior government decision makers to learn how institution business/industry partnerships might be the foundation for a comprehensive, integrated program
of workforce development activities in India, including specifically those related to technical /
vocational education.
Institution - business/industry partnerships
Institution - business/industry partnerships have been used with great success in several countries
to engage the private sector in activities that typically had been the exclusive domain of
government. Involving the private sector in all aspects of program planning and management has
enriched public policy setting and decision making processes, assured that limited resources
were used with maximum impact, and created informed private sector advocates for government
initiatives. These lessons appear to have great potential benefit for India.
The workforce development roundtable, therefore, is designed not only to discuss the topic itself
but also to initiate a program planning and implementation mechanism so that institution business/industry partnerships move beyond discussion into action.
Objectives for (lie workshop:
1. Understand and accept "partnerships” as the best way to accomplish a shared goal.
2. Recognize that workforce development is a shared goal of government and the private sector.
Building a Partnership
Partnerships between business and education are essential for economic growth and development
in India and for India. Businesses need educated and skilled workers at all levels to produce
high-quality goods and services at competitive prices. The education establishment needs the
feedback, guidance, and advocacy of concerned businesspersons in order to maintain the
relevance of its curriculum. I his mutual interest in developing students/workers with a strong
foundation of basic knowledge and demand-oriented skills provided the rationale and impetus for
developing a sustainable institution business/industry partnership in India.
Institution - business/industry partnerships to support workforce development, job creation, and
economic growth have been widely used in developed countries. It has many lessons for India.
**
Expected Outcomes of the workshop
f ollowing are the outcomes of the programme -
A. Better awareness and understanding among Heads of Institutions about the employment and
training needs of local business.
B. Government policies on employment would be better understood and utilised.
C. Government, business and industry would become aware of the training opportunities
available in their localities.
I). Effective Industry - Institution partnerships will be developed leading to More resources for training available to the institution.
Better exposure to new technologies for instructors/students.
<*
Better programmes relating to finding employment i.e. facing interviews and group discussions
(recruitment process) offered to students.
Better awareness of workplace requirement available to students.
**♦
Better access to employment in local industries
About the Organization
SKILLS FOR PROGRESS - SKIP, is an all India association of private vocational and technical
institutions and individuals who are committed and concerned about skills development and
workforce training.
SKIP has 200 member institutions that enable it to achieve its aims and
objectives. Skills training for employment
is a major activity and SKIP works for the
development of the economically and socially weaker sections of society. Over 25.000 men and
women attend courses and programmes in SKIP's member institutions every year.
SKIP'S main focus was on supporting formal and non-formal skills training in the traditional
technical/vocational jobs areas. In
1996. SKIP expanded its activities to include training in the
subsistence and appropriate technology sectors. The profile of our beneficiaries has changed.
SKIP reaches out to the illiterate and semi-literate rural and urban populations.
SKIP’s members deal with the many issues of training and employment. They are concerned
about the employability and employment opportunities for their graduates. Collaborations with
local business and industry are being initiated and encouraged to enable training institutes to
understand the nature of industry's workforce requirements.
A round table is being organised for administrators of vocational/technical training institutions
w ith representatives of business and industry, so that SKIP'S members will better understand the
concerns of the industry with regard to workforce development.
skip-biduslrv linkages project
2
M ' 7- -
NHMRC Research Committee Questions and Answers
Commercialisation and Development Grants
Q40. How does the NHMRC support greater commercialisation of health research?
A. Good Intellectual Property (IP) management is a critical step in translating research into national wealth.
The NHMRC, in consultation with other Commonwealth and State Government agencies, research
organisations, universities and the research community has developed a set of guiding principles foi IP
management. The purpose of developing the Interim Guidelines for Intellectucd Property Management for
Health and Medical Research is to assist NHMRC funded researchers and their administering institutions,
in ensuring that they have access to best practices for the identification, protection and management of IP.
and therefore, to maximise the benefits and returns of public investment in health and medical research.
The Interim Guidelines Intellectual Property Management for Health and Medical Research were endorsed
by the Council at its March 2001 meeting.
It is acknowledged that transitional arrangements will be necessary to allow institutions to bring their
policies and procedures into line with the Interim Guidelines.
■Q41. What is a development grant and how do I apply for one?
A. Development Grants are designed to support development work undertaken on products, processes,
techniques or procedures arising from fundamental biomedical research and which have commercial
potential. For example, funding may be provided for such ventures as demonstrating proof of concept of a
new therapeutic or diagnostic product/technique, producing a working prototype of a piece of medical
equipment, or improved formulation of a chemical compound so that its commercial potential can be better
explored.
Development Grants are awarded in two categories:
Category A
Exploratory research at proof-of-concept stage with commercial potential in the health area: and
Category B
Relatively late stage research which will permit the development of special procedures, therapeutics,
diagnostics and/or medical equipment to a stage where they become useful in health care delivery or
become commercially viable.
An Industry partner is required for Category B Development Grants.
Further information regarding the grant, submission of applications, or conditions associated with NHMRC
grants, are available on the Internet on NHMRC’s Project Grants 'Advice, an din str iictn insJ.oil_Apiilicai.it.s'
page.
[Cjfotop]
*
Q42. What is the Industry Fellowship and how do lapply?
A. Fellowships are intended to target current academic researchers, to provide successful applicants with an
opportunity to expand their research horizons and gam experience in important facets of the commercial
development of research findings, including project planning, business planning, and knowledge of
business and industry dynamics.
• The NHMRC will establish up to ten Industry Fellowships each year.
• The package being offered is $80,000 pa, and the package will cover salary and on-costs, travel,
allowances and direct research costs.
• The fellowship will be available for 4 years with the first 2 years (maximum) to be spent full time
at an "industry" placement, and the final 2 years to be spent in a research institution.
Further information regarding the fellowship, submission of applications, or the associated conditions arc
available on the Internet on theNHMRCN 'Fellowships' page.
Q43. What are Support Enhancement Options currently available and who is eligible?
A. Consistent with the objectives of further strengthening the capacity of the Research Fellowships Scheme
to translate outcomes into practice and bridge the research/industry gap. Support Enhancement Options
(SEO) are available in addition to the base Research Fellowship Packages. These will be provided only to
applicants who can demonstrate that they undertake activities that result in:
• Interface of research with health practice, and/or
• Sustained research links with industry development.
An additional $15,000 per annum is available in the case of each of the Support Enhancement Options.
Health Practice. A Health Practice Support Enhancement Options (SEO) is available to all Fellows who
demonstrate an application or link of their research to health practice. This will not merely be dependent on
the applicant holding medial or dental qualifications, as has been the case. Rather researchers in all areas of
health practice who are able to demonstrate a continuing interface between their research and health
practice outcomes will have an opportunity to obtain this SEO. This allowance aims to enable the clinician
and practitioner in research to maintain their professional associations. It is hoped that this will result in a
two-way translation of research into practice and identification from practice of research foci.
Industry. An Industry Support Enhancement Options (SEO) is available to all Fellows who demonstrate
they undertake activities that result in sustained research and development links with industry. The
allowance aims to strengthen the capacity of the research fellow to translate his/her research into
commercial products. Such a SEO may be used, for example, to recruit a part time researchers or other help
to free some time for the Fellow’s activities. An application for a Support Enhancement Option can be
made either with a new Research Fellowship application or during the course of an existing Fellowship
appointment. If made during the course of an existing appointment, the application must be submitted as
part of the annual cycle of research Fellowship applications and form.
Intending Applicants should note the application form for the next round will be posted on the NHMRC
website in the near future.
I he health cost office trade
Global Tree trade’ rules threaten the integrity of basic services such as health and water - and the
General Agreement on Trade in Services should come with its own health warning, says John
Hilary
Remember the good old days when global trade rules just covered bananas, coffee and tuna? Now. as the
World Trade Organisation (WTO) expands into areas previously untouched by its Tree trade' agenda, the
integrity of such basic services as health, water and sanitation is under threat.
With increasing pressure on governments to allow market forces and privatisation into basic senice
sectors, there are serious concerns about the health impact of the WTO’s trade regime.
GATS the General Agreement on Trade in Services - is the framework under which the most powerful
trading blocs, such as the EU and USA. are pushing for increased commercialisation of health and water
services across the world.
Adopted as one of the key pillars of the new global trade structure in 1994, GATS works through
successive rounds of liberalisation to create new markets for foreign service providers, such as private
hospitals, clinics and medical insurance companies.
Although countries are supposed to be allowed to proceed with liberalisation in line with their own needs
and priorities, it is the commercial interests of private sector providers that are forcing the pace.
This pressure for increased private sector involvement in basic services risks exacerbating problems of
equity, quality and capacity in public health systems, many of which are already under severe strain.
Research by Save the Children has revealed how increased commercialisation threatens children's right io
health.
I’he introduction of cost-recovery programmes in the health sector (often under pressure from the
International Monetary Fund and the World Bank) has forced many families into a kmedical poverty trap',
whereby they have to choose between incurring long-term debt in order to pay medical expenses or
simply foregoing even essential health care.
In Vietnam, for example, a country known for its achievements in sustaining low infant and maternal
mortality rates in the pre-liberalisation period, the introduction of fees for health care has led to greatly
increased inequality in access to such care between rich and poor families. Half of poor households w ith a
family member who need medical care are now forced to borrow money or sell livestock to meet the
expenses, with chronic illness leading families into severe debt. As a result many families have kept their
children away from health clinics: the number of public health care consultations halved in the first seven
years following the introduction of liberalisation in 1986.
Private sector ‘cream skimming'’
f or developing countries with failing health systems, private investment can seem an attractive source of
capital and medical technology at a time when other resources are thin on the ground. Yet involving
private companies in health care has the potential to marginalise poorer patients even further.
Companies seek markets in which they can be assured of sufficient returns, and this typically concentrates
investment in more affluent areas. Loans provided by the World Bank’s International Finance
( orporation, for instance, are predominantly directed towards expatriates and the richer communities of
the country in question, not the majority of the population.
This practice of'cream skimming’ is already familiar from the field of private health insurance: insurance
companies and health maintenance organisations (HMOs) typically favour the healthy and wealthy over
high-risk customers, and exclude the latter by means of prohibitive premiums.
Similarly, m terms of direct health care provision, the private sector’s profit-making imperative makes it
of limited relevance to those sections of society that are unable to pay for its services, even though it is
they who need the extra investment most.
Yet private investment in health care is not simply an irrelevance to poor people. An expanding private
sector draws professionals away from public health systems and exacerbate shortages of trained and
qualified staff. This was evident in Thailand, for example, during the 1980s and 1990s.
Often it is the most highly skilled staff who make the move to the private sector, lowering the overall
standard of care in the public health system.
More generally, cream skimming undermines the very ability of public health systems to sustain
themselves financially, as it denies the basic principles of cross-subsidisation and risk-pooling by which
the healthy support the ill, the young the old, and the rich the poor.
Profit before quality
fhere are potential conflicts of interest between commercial pressures and public health goals when
private companies are introduced into public health services. In industrialised countries this has
commonly meant poorer quality services as a result of cost-cutting, often through the substitution of
casual for skilled labour.
It has also led to service planning being led by financial rather than clinical imperatives, with
accompanying reductions in the clinical workforce and service capacity.
In the US, where the health care market has become increasingly competitive. HMOs have responded by
pressurising doctors to withhold treatment from patients. By means of performance-related pay
mechanisms linking their income to the clinical costs they incur, doctors are encouraged to refer the
lowest possible number of patients to specialists or to hospitals. Those who minimise costs gel bonuses,
while doctors who generate above-average costs risk expulsion by the HMO.
In developing countries, commercial pressures lead to similar cost-minimising strategies. One study of
private clinics in Malaysia revealed that many fail to assess new clients properly in their provision of
family planning services, with cervical screening undertaken only if requested. Conversely, private
practitioners in Egypt have been found to be less likely than public sector workers to administer
(inexpensive) oral rehydration solution, and more likely to prescribe antidiarrhoeal drugs - even though
the latter are contraindicated in the country’s national programme.
Involving private companies in the health sector requires very definite structural conditions if it is not to
damage the quality of health care delivery in systems which are already under severe strain. As the WHO
has stressed, national and regional health authorities need highly developed regulatory, analytical and
managerial capacity if they are to see any benefit from working with the private sector.
But in the majority of poorer countries, this regulatory capacity is simply non-existent. As a result, the
introduction of private sector investment threatens to divert care from public health priorities and to
compromise quality of health care further.
Worse still, GATS itself undermines the ability of governments to regulate services in the interests of
public health, as it requires countries to limit regulations so that they do not restrict trade (see box below).
Privatisation of water
As with health care, increased commercialisation has further restricted poor families' access to clean
water and sanitation in many parts of the world. Cost recovery and water privatisation schemes have
typically involved significant price rises, often putting water well beyond the reach of low-income
households.
In Ghana, for example, where the World Bank is making water privatisation one of the conditions which
will trigger hundreds of millions of dollars in additional loans, it is feared that water tariffs could rise by
up to 300 per cent - well beyond the means of most families. And low-income families in the Mauritanian
capital Nouakchott now have to spend up to a fifth of their household budget on water.
Low-income families in Nouakchott now have to spend up to a fifth of their household budget on water
Where households are unable to sustain such a level of expenditure, children are often exposed to health
risks from water collected from rivers or other untreated sources. More than two million children die from
diseases related to water and sanitation every year, while millions more suffer from health problems such
as schistosomiasis and intestinal worms.
Despite the health problems that increased commercialisation of water services brings, the European
I nion is trying to use the current round of GATS liberalisation to open up public water systems in
countries around the world. Documents leaked in April 2002 reveal how the EU is targeting the water
sectors of other countries for penetration by its own private water companies.
At the same time, US health companies are urging their government to push for increased market
opportunities in foreign health sectors. As the powerful Coalition of Service Industries reminded the US
I rade Representative at the start of the current round of GAI'S liberalisation: 'Contestable markets in
every sector and in every WTO member is the ultimate goal.'
1 ogether with groups in many other countries. Save the Children is campaigning for a halt to the GATS
liberalisation process. Increased commercialisation of the health and water sectors is the wrong model to
adopt if we are serious about providing universal access to basic services. There must be an informed
public debate at both national and international level on the alternatives to liberalisation, and an end to
profit-led privatisation schemes. Only then can we hope to provide children throughout the world with
their right to a healthy future.
I he deregulation agenda of GATS
One of the most damaging requirements of GATS is that national regulations governing sen-ices must be
subordinated to the demands of free trade.
I 'nder GATS, domestic regulations must be constructed so that they do not represent ‘unnecessary
barriers to trade'. In practice, this means that countries can be challenged over the type and level of
measures they employ to regulate services, with governments forced to justify their own regulations in the
face of WTO rules.
Regulations and standards are crucial for maintaining public health. Yet the WTO rules found in GATS
have already been invoked by the US government in its attempt to overturn Thai land's ban on tobacco
imports a policy endorsed by the WHO as essential for preventing smoking among Thai women and
children.
Putting trade before public health risks undermining many such public health initiatives. Save the
( hildren is calling for the GATS restrictions on domestic regulation to be removed, so that countries can
maintain regulations at the highest possible level in the interests of public services.
Fight ’commercialisation’ of health sector: VS
By Our Special Correspondent
THIRUVANANTHAPURAM APRIL 13 The Leader of the Opposition, V.S. Achuthanandan. has alleged
that the Government's decision to impose exorbitant fees on the patients seeking treatment in the medical
college hospitals is designed to facilitate the privatisation of these institutions.
In a press release here today, he said the Government had entrusted to the respective hospital
development committees the responsibility of collecting the fees. The doctors working in these hospitals
had no role in the committees. The committees were being virtually controlled by the representatives of
some of the UDF constituents.
Mr. Achuthanandan alleged that the funds being raised through treatment fees by the hospital
development committee at the Kozhikode Medical College were not being utilised for the good of the
hospital. The committee members were spending the funds according to their whims and fancy. A fraud
worth several lakhs of rupees was detected in the utilisation of funds in this hospital recently, he said.
The concern of most of the hospital development committees was to go in for purchases which could
fetch attractive commissions for the members. They were also busy appointing their own people in the
hospitals. The Government, expecting increased revenue through the fees newly imposed on the patients,
was slashing budgetary support to the hospitals. The situation would soon reach a stage when even basic
facilities could not be provided to the patients for want of funds, Mr. Achuthanandan said.
He alleged that the Government was trying to get a big loan from the World Bank in the name of
modernising the medical colleges in the State. Definitely, a big chunk of this loan would be devoted for
constructing buildings and purchasing expensive equipment, Mr. Achuthanandan alleged.
This was what had happened in the other States where the Governments had gone in for World Bank
loans for hospital development.
A stage would soon arrive when it would be impossible for the poor to approach the hospitals to get
medical attention.
The number of patients approaching the Kozhikode Medical College Hospital had already dropped
because of the high cost of treatment.
1 le said the Government could not back out of its responsibility of providing free medical attention to the
poor. In commercialising the health sector, the Antony Government was depriving the poor the right to
medical care and the right to live, the Opposition leader pointed out.
- Media
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