Year: 2020

These leader behaviors are definitely a sign that in the near future, your employees are going to walk out the door. Yet, there is one aspect that is missing. The article says what leaders shouldn’t do by providing behavioral examples one sought to avoid.

How to keep your employees from leaving?

1. Give more praise and recognition

It’s not always about money or tangible extrinsic rewards. Why? Many people quit because of lack of appreciation. Extroverts or introverts, your employees still get a kick out of public or private praise. People like to be recognized for their wins.

2. Set clear objectives and goals

It’s difficult for employees to give their best if the task’s goal changes more often than they change their socks. Communicate your expectations clearly and set precise goals. Results are only as strong as the objectives you set. Try the management Google and LinkedIn practice—OKR—Objectives and Key Results.

3. Be future-driven

Analyzing the past is important to projecting the future. But focusing solely on employees’ progress isn’t enough in a fast-paced workplace. You also need to study the future, as impossible as it might sound. Using a management technique like PPP Progress, Plans, Problems helps you be aware of your teams’ plans.

4. Seek input and ideas

More often than we think, decisions are made without seeking input. This strategy might save you few minutes or hours, but it doesn’t guarantee success. Sometimes it’s okay not to be the smartest person in the room. Ask input from people around you. Your team has brilliant ideas; just learn to ask.

5. Give continual feedback

As tasks grow more complex and interdependent, people need more feedback. Employees need to feel that they are heard by their managers and they need it more often than twice a year. There is a correlation between employee engagement and periodic feedback.

6. Measure satisfaction

All of these tips mean nothing, if you fail to measure their success. Although it would be wonderful if it were true that one could assert that 2 pieces of feedback a week increased employee satisfaction by X percent, it is just not the case. Guidelines are only guiding lines. You are responsible for figuring out the exact actions. You can manage only what you measure.

7. Save time in meetings

One of the biggest employee motivation killers is wasting their time. Holding a poorly prepared status update meeting that lasts for hours wastes everyone’s time, including your own. Prepare for meetings; replace unnecessary meetings with online real-time tools. Try the free online Team Meeting Toolbox. Providing you with necessary tools before, during and after the meeting, so you’re next meeting would be awesome.

8. Ask about emotions and attitudes

Don’t mix giving praise and providing feedback with asking about attitudes and emotions. The two are not the same. The first two relate to the result, the other two relate to the journey. You’ll be surprised what you learn about your team when you ask emotional questions.

9. Don’t be too negative

Constructive feedback is necessary, even if it’s negative, but regular criticism will take down even the strongest. People have much greater recall of unpleasant memories than positive ones. To keep your people happy and motivated, be positive and lead by example.

10. Communicate openly

Open internal communication plays a big role in successful teamwork. Share your weekly plans and thoughts; it will encourage an open atmosphere. Only after mastering the skill of sharing openly can you expect the same from everyone else.

An exit interview is a survey conducted with an individual who is separating from an organization or relationship. Most commonly, this occurs between an employee and an organization, a student and an educational institution, or a member and an association. An organization can use the information gained from an exit interview to assess what should be improved, changed, or remain intact. More so, an organization can use the results from exit interviews to reduce employee, student, or member turnover and increase productivity and engagement, thus reducing the high costs associated with turnover. Some examples of the value of conducting exit interviews include shortening the recruiting and hiring process, reducing absenteeism, improving innovation, sustaining performance, and reducing possible litigation if issues mentioned in the exit interview are addressed. It is important for each organization to customize its own exit interview in order to maintain the highest levels of survey validity and reliability.

The exit interview fits into the separation stage of the employee life cycle (ELC). This stage, the last one of the ELC, spans from the moment an employee becomes disengaged until his or her departure from the organization. This is the key time that an exit interview should be administered because the employee’s feelings regarding his or her departure are fresh in mind. An off-boarding process allows both the employer and employee to properly close the existing relationship so that company materials are collected, administrative forms are completed, knowledge base and projects are transferred or documented, feedback and insights are gathered through exit interviews, and any loose ends are resolved.

In business

Exit interviews in business are focused on employees that are leaving a company or when employees have completed a significant project. The purpose of this exit interview is to gain feedback from employees in order to improve aspects of the organization, better retain employees, and reduce turnover. During this interview employees will be asked why they are leaving, what specifically influenced their decision to leave, whether or not they are going to another company and what that company they are going to offers that their current company does not. Businesses can use this information to better align their HR strategy with what employees look for in an organization and enact programs and practices that will influence top talent to stay at the organization.

In the past, exit interview data was being collected by the organization but not much was being done in terms of interpreting the data and making it actionable. Today there are metrics, analytics, benchmarks, and best practices that help organizations make sense of and use the data towards proactive organizational retention programs. Recently an array of exit interview software has been developed and popularized. However this method of conducting Exit Interviews has some significant flaws, most notably, that it identifies the wrong drivers of staff turnover.

In education

Exit interviews in education are conducted with students who have graduated from an educational institution. These interviews are meant to gather information about students’ experience while attending that institution, what they benefited from, what was missing, and what could be improved to enhance the experience of the next generation of students who attend that institution. This type of interview can also point to areas in which the institution should invest more or less resources to enhance a student’s learning and development experience.

Methods for conducting exit interviews

There are various methods of conducting exit interviews, each with their benefits and disadvantages.

1. Face to Face interviews

Historically, this has been the primary method for conducting Exit Interviews (79% of organizations), although this is changing rapidly. These face to face meetings are usually conducted internally by a human resources professional or manager, or in rare cases, by an external consultant.

Benefits of Face to Face Interview

The main benefit of this method is that completion rates tend to be high, as long as the interview is conducted by a relevant and suitably skilled professional (external consultant, HR professional or indirect manager). In addition, departing employees have a personal experience which may cause them to speak more positively about the company (affecting their ’employer brand’) after they leave. Also, if Interviewers are well trained, the content can be well structured and checked in real time to ensure accuracy of data, especially concerning reasons for leaving. This method also allows high quality data to be collected from people whose literacy skills are not good.

Disadvantage of Face to Face Interview

The disadvantages of this method are that the feedback is rarely captured in a way that allows reporting on trends with more than a third of organizations using this method having no reporting tool attached to their exit data. If conducted by an external consultant, this method can be expensive. It’s also sometimes the case that the human resources professional who might conduct the interview, could be part of the employee’s reason for leaving (e.g. I was overlooked in the pay review while on parental leave and my HR person wouldn’t return my calls). This would mean that the employee is unlikely to be honest if that HR professional was conducting the exit interview. Unfortunately very few organizations (20%) provide any training on exit interviewing so the quality is often highly variable. In addition, this method is the most expensive if outsourced.

2. Telephone interviews

Exit Interviews conducted by telephone are becoming more common (41% of organizations) and are the most effective method of Exit Interviews.

Benefits of Telephone Interview

Feedback is easy to capture and code in a form that allows easy reporting and analysis. Because the Interviewer’s visual attention does not need to be dedicated to the person in front of them, as it does in a face to face interview, they are able to capture and code feedback in real time. Completion rates are the highest of all methods, possibly due to there being no need for the Interviewer and Interviewee to be in the same physical place, but also because the interview can be conducted even after the person has left (see Timing of Exit Interviews). If Interviewers are well trained, the content can be well structured and checked in real time to ensure accuracy of data, especially concerning reasons for leaving. And as with face to face interviews, the experience for the Interviewee can be very personal. This method is easy to outsource, and is less expensive than face to face interviews. It also allows for high quality data to be collected from people whose literacy skills are not good.

Disadvantages of Telephone interview

This method is that it is more expensive than online and paper surveys. Some Human Resources professionals enjoy conducting the interviews, so outsourcing the interviews removes this task.

Percent of exit interviews completed according to who conducted the interview.

3. Paper surveys

Exit interviews taken in paper form allows interviews to be conducted with those who do not have Internet access, and allows for the option of anonymity. However, it takes longer to receive feedback, and respondents who are not literate would find it difficult to use this medium. Information must also be entered into a tracking system manually for this medium. As at 2010, 46% of organizations still conducted Exit Interviews using this method.

4. Online surveys

As at 2010, 38% of organizations used this method for Exit Interviews.

Benefits of Online Survey

This is the least costly method of conducting Exit Interviews, with several free survey software tools available on the market. It also collects data in a way that is easy to report and analyse.

Disadvantages of Online Survey

There are two significant problems with using online surveys for Exit Interviews. The most critical problem is that they identify the wrong drivers of staff turnover Because online surveys do not allow for testing of root cause, the reasons for leaving are not differentiated from issues that caused dissatisfaction but not resignation. In addition there is no ability to ensure that the commentary for each reason for leaving, is consistent with the reason for leaving option they have chosen from a list. The second problem with using online surveys for Exit Interviews is the relatively low completion rate at 34%. This is around half the average completion rate of interviews that are outsourced to external consultants (66%) and around a third of best practice for outsourcing phone interviews (95%).

5. Interactive voice response surveys

IVRs are reliable methods of taking exit interviews because they are accessible by phone, a very widespread and reliable technology. However, IVRs have fallen out of favor due to the cost effectiveness of web based options that yield data at similar or higher quality. In comparison to other options, it is difficult to get rich data from an IVR, or to adjust and change it, since any changes require new voice recordings to be made.

Importance of Exit Interview

1. Departing employees are generally more forthcoming than those still in their jobs
2. You will learn the reason for an employee’s departure (it may be different than you think!)
3. The exit interview allows the employee to provide constructive feedback and leave on a positive note.
4. That last touchpoint provides you with an opportunity to review continuing obligations with the employee (e.g., non-competes, intellectual property agreements, etc.)
5. It provides the opportunity to ask if there are any open issues of which you need to be aware. This can help reduce risk and identify matters that may require immediate attention.
6. You will get a candid assessment of your organization’s environment and culture.
7. Insight into recruiting, on-boarding, and training needs may be revealed.
8. The feedback will help you to identify areas that can help improve staff retention.
9. Improvement opportunities in management development and succession planning can be detected.
10. It’s cost-effective and easy to facilitate with HR Acuity Exit Interviews.

No matter the size of your company, exit interviews provide an opportunity for an employee to discuss the workplace environment, concerns about misconduct, or issues within management.

Groups exist in every formal and informal type of organisations. Such groups are created by the members for its satisfaction. Very often groups get formed automatically because of the operation of various socio psychological factors. Such groups affect the behaviour of its members.

Group dynamics is related to determining the interactions and forces between group members in a social situation. The term dynamics originated from the Greek word meaning force. Thus if this term can be extended to group dynamics, it refers to the study of forces operating within a group. Here it would be proper to mention the difference between aggregates and groups. Aggregation of individuals refers to where individuals are not aware of each other, or if aware, do not interact with each other in a meaningful way. A group will comprise of:

1. Two or more people who are interdependent on each other, with group members and
2. The group share a set of beliefs, valves and norms, which regulates their mutual conduct.

Meaning of Group:

Marvin E. Shaw has defined groups as “two or more persons who are interacting with one another in a such a manner that each person influences and influenced by each other”

People generally tend to define a group differently, mainly because it is difficult to define a group independent of some specific reference or purpose. As per the above definition when two or more people interact together such that each member is influence as well as be influenced by other group members, it is referred to as a group

Clouis R. Shepherd defines groups as “A group may be defined as the aggregation of small number of persons who work for common goals, develop a shared attitudes and are aware that they are part of a group and perceive themselves as such”.

Characteristics of Groups:

1. Two or more persons: To form a group there should be atleast two persons, because a single individual cannot interact. Though no maximum limits have been set, the size of the group should be such so as to allow meaningful interaction among the members of group.
2. Collective identity: Each member of the group must believe that he is member of the group and also be aware of his participation in the group activity. For instance a group of boys are room-mates staying together in the hostel. Though they may not be studying in the same class but because of their identity of room-mates they would prefer to go out together for shopping.
3. Interaction: Members of the group will interact with each other. Though it is not necessary for all members of the group to interact simultaneously but each member must atleast occasionally interact with the members of the group.
4. Shared goal interest: Members of the group should concur to the attainment of objectives each one must atleast share one of the groups concerns

Reasons for formation of groups:

The reasons for the formation of groups are as follows

1. Solution for mindedness: Though the group members bring with them expertise in the form of knowledge and experience sometimes due to want of time the group members may pressurise all concerned with the group to arrive at solution to the problem quickly. In such cases the decisions arrived at may be improper/ hasty/ premature one and need not be the correct one.
2. Compromised results: In case of problems the group members though interactions and discussions will understand the problem hold discussions and try to arrive at a consensus. However sometimes when consensus is arrived at, the group may perceive group harmony as more important than any given task decision. This results in a compromise on the solution arrived at. Under the circumstances this may not be the best solution but rather a compromised one.
3. Untimely decisions: One of the characteristic features of a group is that decisions can be taken very fast. But at a times leader of the group will as a rule of the thumb take a decision and then communicate it group. In such cases the very purpose for formation of a group is defeated. By following the thumb rule the group leader will be taking a unilateral decisions and not the united one. Moreover since the decision taken is single handedly and also arrived at quickly it may be an untimely decision.
4. Conflicts: Since the informal group exist to meet and satisfy the social needs of its members, there are chances of occurrences of role conflict. This problem arises when the individual group member becomes more committed to his/her own goal and seem to undermine their group members problems. In case of imbalance between the two and if the group as such is not constituted properly conflict may arise.
5. Dominance: Groups are useful for transmitting and sharing information. In case of a problem all members can discuss it together and decisions can be arrived at with opportunities for clarification. However there is is always a fear of a single person a dominant personality assuming unofficial authority.

Types of Groups:

1. Family life cycle:

Even though it is the family unit which purchases home appliances, toys, furniture etc, it is cannot be implied that all the families are in the market at the same time or for that matter at any time. This means that along with family decision making the family life cycle also plays a role in influencing consumer behaviour and also helps in gaining insight into consumption related behaviour.

People’s consumptions patterns of goods and services they buy and consume changes over their lifetime. As babies they consume baby food in the earlier years, most food items in their growing and mature years and specific diets in the later years. Individuals taste and preference related to cloths, automobiles, idea of re-creation etc. is also related to stage of the family life cycle and age.

Some writers like Gail Sheehy in his papers ‘predictable crisis in adult life’ and Roger Gould in ‘transformation’ has identified certain psychological life cycle stages that adults experience certain passage or transformation as they go through life. This means that changing consumption interest can also associated with these adult passages.

Thus marketers very often try to identify their target markets in terms of family life cycle and develop appropriate product and marketing plans. Further they also have to pay attention to the changing consumption interests that might be associated with these adult passages and develop marketing programmes accordingly.

2. Friendship groups:

An individuals for his/her protection self awareness and enhancement needs others around him/her Leon Festinger in his ‘ A theory of social comparison processes’ has claimed that there exists in the human organisms a drive to evaluate his opinions and abilities. If objective non social means are not available of others. In other words human beings prefer the company of other and these people’s opinion also matters to them. Consumers also enjoy the company of their friends when purchasing certain types of goods. Such friendship group influence the consumer especially products like clothing, fine jewellery, cosmetics and personal care items, food items etc.

The influence of the friends is also seen in buyers choice of food habits and drinks. Marketers have realised the important role played by the friends in influencing the consumption pattern of individuals in certain category of products and also involved in designing suitable marketing communication programmes. To mention a few advertisements- coca-cola,(all soft drinks) close up, colgate etc (tooth paste) rin bar , life bouy, life bouy plus,(soaps and detergents) Hero tribe ranger (cycle) Four square, Gold Flake etc. (cigarettes) and so on are based on themes of evolved around friendship.

3. Formal social clubs:

Human beings are generally considered to be sociable in nature, spend much of his/her time in group situations. They like to be associated with formal social clubs like the Rotary Club, Lions Club etc. The reason for their getting associated with such social groups may be to achieve a specific goal like making new friends, career advancement or pursuing a special interest or promoting a specific cause. Such formal social systems generally comprises of three elements

Activities are the tasks that people perform. Interactions are the behaviour that occurs between people in performing the tasks. And the sentiments are the attitudes that develop between individuals within the group. George C. Homans argues that these concepts through separate and closely related. A change in any of these three elements will produce some change in the other two.

In a formal organisation setup, job (activities) has to be done that require people to work together (interactions). These jobs must be sufficiently satisfying (sentiments) for people to continue doing them. With more and more positive interaction with each other, more and more positive sentiments will be developed by the people towards each other. As, this process continues there is tendency for the group members to become more alike in their activities and their sentiments.                                   

Markets releasing the role played by the formal groups on their individual members can work out a suitable sales promotion and communication programme and deliver the same to its target segment.

4. Shopping friends/groups:

According to psychology ‘group’ refers to the number of people who interact with one another are psychologically aware of one another and perceive themselves to be a group. In the same way, shopping groups can be assumed to exists because the friends or the group members need to relate to each other mainly because of the physical location of the people same perception of things matching personality, styles ,outlooks etc. These factors are responsible for the increase in the frequency of the interactions between the members of a shopping group.

So depending on the product category and target market segment the marketer should develop a marketing programme keeping in mind the shopping group who are likely to be involved in the decision making process and who will are also likely to influence the individual buyer.

5. Work Group:

This group can comprises of formal work group and informal work group. The formal work groups are those which are deliberately created by companies in order to fulfil specific tasks or functions clearly related to the total organisational goals and objectives. Based on their duration, the formal work groups can be of two types.

a) Permanent formal work group: Are part of the top management team, work units in various departments of the organisation staff groups proving specialised services to the line people in the organisation, permanent committees and so on.

b) Temporary formal work groups: Are committees or tasks forces created for a particular purpose/mission. They may be created to study and review the salary policies to suggest measures to improve the relationship between the union and management or to think of new products and services and so on. These temporary formal groups may exist till the tasks assigned to them have been completed. Very often the committee /temporary work group will comprise of members, who are already on the permanent payroll of the company. However till the completion of work assigned to the committee there will be close interactions between the members.

Markets must realise that the work group also plays a very important role in promoting their products and work out marketing programmes to communicate information about their product and its usage to the work groups.

The influence of culture is inevitable in our societal living. However, within a larger society, there are sub systems of values exhibiting variations in behavioral pattern. Marketers have begun to segment larger societies into smaller subgroups that are homogeneous in relation to cultural values.

The individuals of a specific subculture vary in their consumption patterns. They show variation in lifestyle, financial viability, food preferences, reading habits, purchase of specific brands in a particular product category, purchase time, store patronage, etc.

Multi Culture in India

India is said to be a country of multi cultures. It is so because of its long history of civilization. Different rulers have ruled the country. These rulers had different systems of governance and social practices. However, now there is unity in diversity which is important to any marketer in framing strategy for marketing.

The diversity has given birth to ever increasing number of States. India is a country with 29 states and six union territories. Each state has its own own culture. There are more than one subculture is found in some states. There are major religions such as Hindus, Muslims, Sikhs, Christians, Jains and Bhuddhas.

Each state and religion has its own traditional style of dressing, wearing ornaments, food preferences etc. Wheat and wheat products are consumed more in north India. People in south India consume rice. Certain communities do not eat non-vegetarian food, while among the other communities non-vegetarian food is popular.

Differences in Consumption pattern

Differences are found in the consumption pattern related to rural – urban sub-cultural division. Variations are found in preferences for food items, housing, clothing, home, furnishing, transport vehicles used, recreation and leisure activities, saving pattern, etc.

Economic Status – Classes of people in India

Economic status is another important sub-cultural variation. According to economic status, people can be divided into three classes:

1. The upper or affluent class,
2. The middle class, and;
3. The lower class.

The affluent class accounts for only a negligible portion of the society. Luxury items are consumed more by the affluent class.

On the other hand, the lower class spends more on necessary items. People in the lower class have very little purchasing power.

What is more important to the marketers is the middle class which forms a big chunk. Marketers have evinced a keen interest in the consumption pattern of the middle class. In spite of the regional, linguistic and cultural activities in India, middle class consumers follow a common pattern of the lifestyle and buying behavior. They are basically a security seeking class.

They need social security along with economic and emotional security. They respond favorably towards innovations, only if they are convinced about their security needs. They always strive to rise higher in social strata. They purchase products which add to the joy and comforts of their family members.

Thus, a study of sub-cultural variations will help, the marketer in designing marketing programmes suitably to target consumers of each subculture category.

Consumer behaviour deals with the study of buying behaviour of consumers. Consumer behaviour helps us understand why and why not an individual purchases goods and services from the market.

There are several factors which influence the buying decision of consumers, cultural factors being one of the most important factors.

Cultural Factors

Cultural factors comprise of set of values and ideologies of a particular community or group of individuals. It is the culture of an individual which decides the way he/she behaves. In simpler words, culture is nothing but values of an individual. What an individual learns from his parents and relatives as a child becomes his culture.

Example: In India, people still value joint family system and family ties. Children in India are conditioned to stay with their parents till they get married as compared to foreign countries where children are more independent and leave their parents once they start earning a living for themselves.

Cultural factors have a significant effect on an individual’s buying decision. Every individual has different sets of habits, beliefs and principles which he/she develops from his family status and background. What they see from their childhood becomes their culture.

Females staying in West Bengal or Assam would prefer buying sarees as compared to Westerns. Similarly a male consumer would prefer a Dhoti Kurta during auspicious ceremonies in Eastern India as this is what their culture is. Girls in South India wear skirts and blouses as compared to girls in north India who are more into Salwar Kameez.

Our culture says that we need to wear traditional attire on marriages and this is what we have been following since years.

People in North India prefer breads over rice which is a favorite with people in South India and East India.

Subcultures

Each culture further comprises of various subcultures such as religion, age, geographical location, gender (male/female), status etc.

Religion (Christianity, Hindu, Muslim, Sikhism, Jainism etc)

A Hindu bride wears red, maroon or a bright colour lehanga or saree whereas a Christian bride wears a white gown on her wedding day. It is against Hindu culture to wear white on auspicious occasions. Muslims on the other hand prefer to wear green on important occasions.

For Hindus eating beef is considered to be a sin whereas Muslims and Christians absolutely relish the same. Eating pork is against Muslim religion while Hindus do not mind eating it.

A sixty year old individual would not like something which is too bright and colorful. He would prefer something which is more sophisticated and simple. On the other hand a teenager would prefer funky dresses and loud colours.

In India widows are expected to wear whites. Widows wearing bright colours are treated with suspicion.

Status (Upper Class, Middle class and Lower Class)

People from upper class generally have a tendency to spend on luxurious items such as expensive gadgets, cars, dresses etc.You would hardly find an individual from a lower class spending money on high-end products. A person who finds it difficult to make ends meet would rather prefer spending on items necessary for survival. Individuals from middle class segment generally are more interested in buying products which would make their future secure.

Gender (Male/Female)

People generally make fun of males buying fairness creams as in our culture only females are expected to buy and use beauty products. Males are perceived to be strong and tough who look good just the way they are.

Even though it is the family unit which purchases home appliances, toys, furniture etc, it is cannot be implied that all the families are in the market at the same time or for that matter at any time. This means that along with family decision making the family life cycle also plays a role in influencing consumer behaviour and also helps in gaining insight into consumption related behaviour.

 People’s consumptions patterns of goods and services they buy and consume changes over their lifetime. As babies they consume baby food in the earlier years, most food items in their growing and mature years and specific diets in the later years. Individuals taste and preference related to cloths, automobiles, idea of re-creation etc. is also related to stage of the family life cycle and age.

Some writers like Gail Sheehy in his papers ‘predictable crisis in adult life’ and Roger Gould in ‘transformation’ has identified certain psychological life cycle stages that adults experience certain passage or transformation as they go through life. This means that changing consumption interest can also associated with these adult passages.

Thus marketers very often try to identify their target markets in terms of family life cycle and develop appropriate product and marketing plans. Further they also have to pay attention to the changing consumption interests that might be associated with these adult passages and develop marketing programmes accordingly.

The concept of household or family life cycle is important for marketers in segmenting the market. In 1966, William wells and George Gubar proposed eight stages to describe the family life cycle.

The following life cycle stages are typical of families:

1. The bachelor stage: young, single person under age of 35 years. Incomes are generally low since they have started careers, but they may have few financial burdens and sufficient discretionary income.
2. Newly married: Young couples, no children. If both spores are employed, they will have high level of discretionary income.
3. Full nest 1: young married couples with youngest child under 6 years of age. There would be greater squeezes on income because of increased on childcare. However, if they are members of a joint family, the level of discretionary income is likely to be high.
4. Full nest 2: young married couples with children from 6 years to 12 years of age. Better financial position because income of both parents rising. Children spend more hours outside their parents influence.
5. Full nest 3: older married couples with dependent teenage children living at home. Financial position of family continues to improve. There are increasing costs of college education for children.
6. Empty nest 1: older married couples with no children living with them, parents still employed. Reduced expenses result in greater savings and highest discretionary income.
7. Empty nest 2: older married couples with no children living with them and parents retired. Drop in income and couple relies on savings and fixed income from retirement benefits.
8. Solitary survivor 1: older single persons with low income and increasing medical needs.

Family decision making and consumption-related roles

When two or more family members are directly or indirectly involved in the decision making process, it is called family decision making. Such family decisions differs from individuals decisions in many ways. For example, if we consider the purchase of a bicycle for a child, some of the relevant aspects to think about can be: who recognizes the need for bicycle? How a brand is selected? What role the concerned child plays?

Joint decisions are more likely to operate in the early stages of family life cycle when both spouses are relatively less experienced. After gaining experience, they usually delegate responsibilities concerning buying decisions to each other.

Key family consumption roles

For a family to function as a cohesive unit, tasks such as doing the laundry, preparing meals, setting the dinner table, taking out the garbage, and walking the dog must be carried out by one or more family members. In a dynamic society, family related duties are constantly changing however, we can identify either distinct roles in the family decision making process.

For example, a family member may be walking down the cookie aisle at a local supermarket when she picks out an interesting new fat-free cookie. Her selection does not directly involve the influence of other family members. She is the decider, the buyer and, in a sense, the gatekeeper, however, she may not be the sole consumer. Products may be consumed by a single family member, consumed or used directly by two or more family members, or consumed indirectly by the entire family.

Dynamics of husband-wife decision making

Marketers are interested in the relative amount of influence that a husband and a wife have when it comes to family consumption choices. The relative influence of husbands and wives can be classified as: husband dominated, wife dominated, joint, and autonomic.

The relative influence of a husband and wife on a particular consumer decisions depends in part on the product and service category. For instance, during 1950s, the purchase of a new automobile was strongly husband dominated, whereas food and financial banking decisions more often were wife dominated. Fifty years later, the purchase of the family’s principal automobile is still often husbands dominated in many households. However, in other contexts or situations, female car buyers are a segment to which many car manufacturers are currently receiving a great deal of marketing attention. Also, in the case of financial decision making, there has been a general trend over the past decade to have the female head of household make financial decisions.

Husband wife decision making also appears to be related to cultural influence. Research comparing husband wife decision making patterns in the people’s republic of china and in the United States revels that among Chinese there were substantially fewer “joint” decisions and more “husband dominated” decisions for many household purchases. However, when limiting the comparison to urban and rural Chinese households, the research showed that in a large city such as Beijing, married couples were more likely than rural couples to share equally in purchase decisions. Still further, because of china’s “one child” policy and the ensuring custom of treating a single child as a “little emperor”, many of the parents purchase decisions are influenced by the input of their child.

In another recent cross-culture study, husband-wife decision making was studied among three groups: Asian Indians living in India, Asian Indians living in the United States, and American nationals. Results show a decrease in husband decisions and an increase in wife dominated decisions, going from Asian Indians in India, to Asian Indians in the United States, to American nationals. This pattern seems to indicate the impact of assimilation on decision making.   

No two individuals have same buying preferences. The buying tendencies of individuals vary as per their age, need, income, lifestyle, geographical location, willingness to spend, family status and so on. An individual’s immediate family members play an essential role in influencing his/her buying behaviour.

An individual tends to discuss with his immediate family members before purchasing a particular product or service. Family members might support an individual’s decision to buy a particular product, stop him for purchasing it or suggest few other options.

Family comprises of:

• Parents
• Siblings
• Spouse
• Grandparents
• Relatives (Cousins/Aunts, Uncles etc)

What an individual imbibes from his parents becomes his/her culture. In countries like India, where children are supposed to stay with their parents till the time they get married, the influence of parents on an individual’s buying decisions can not be ignored. What he sees from his childhood becomes his habit or in other words lifestyle. A female from an orthodox background would prefer salwar suits, saris instead of westerns or short outfits. In India, parents expect their children to dress up in nice, colourful outfits during marriages, festivals or other auspicious occasions. Even if children want to buy something else, their parents would always prompt them to buy traditional attire, thus influencing their buying decision.

The moment an individual enters into wedlock, his/her partner influences his buying decisions to a great extent. In most families, wife accompanies her husband for shopping be it grocery, home appliances, furnishings, car etc.An individual would always discuss with his/her partner before any major purchase. After marriage, individuals generally do not like spending on himself/herself; rather they do it for their partner or family.

A young bachelor would not mind spending on alcohol, attending night parties, casinos but the moment he has a wife at home, he would instead spend on household and necessary items. No bachelor likes to invest money on mutual funds, insurance policies, mediclaims etc but for someone who is married buying an investment plan becomes his first priority. Women generally are inclined towards buying toiletries, perfumes, dresses, household items, furnishings, food products while men would rather love to spend on gadgets, cars, bikes, alcohol etc.Both have different tastes but when they come together, they mutually decide on what to buy and what not to buy.

A Bachelor would never purchase Women’s Horlicks or Kellogg’s K special or a female perfume but when he has a wife at home; he would love to purchase them for his wife. A young girl who has never purchased shaving creams or men’s perfume all through her life for herself would not mind purchasing for her husband, father or father in law. A working woman would have different needs as compared to a housewife. A woman who goes to office would prompt her husband to buy formal trouser and shirt, office bag, make up products etc for her while a house wife would not like spending on all these as she does not require an office bag and so on.

Children also influence the buying decisions of individuals. An individual spends happily on toys, candies, ice creams, chocolates. sweets when he has children at home. Children in the family prompt their parents to subscribe to Disney Channel, Cartoon network and so on.

Individuals do not mind spending on medicines, health supplements, vitamin tablets, protein drinks if they have ailing parents at home.

The family is the main reference group that may influence the consumer behaviour. Nowadays, children are well informed about goods and services through media or friends circle, and other sources. Therefore, they influence considerably in the decisions of buying both fast moving consumer goods and durable items.

A person performs certain roles in a particular group such as family, club, organization, and so on. For example, a person may perform the role of a vice president in a firm and another person may perform the role of a marketing manager.

The vice president may enjoy higher status in the organization as compared to the marketing manager. People may purchase the products that conform to their roles and status, especially in the case of branded clothes, luxury watches, luxury cars, and so on.

The changing structure of family

 Three other basic functions provided by the family are particularly relevant to a discussion of consumer behavior.

These include:

• Economic well being
• Emotional support
• Suitable family lifestyles

Emotional well-being

Although families in the affluent nations of North America, Europe and Asia are no longer formed primarily for economic security, providing financial means to its dependents unquestionably a basic family function. How the family divides its responsibilities for providing economic well-being has changed considerably during past 30 years. No longer are traditional husband as economic provider and wife as home maker and child-rearer still valid. For instance, it is very common for married women with children in the United States and other industrial countries to be employed outside the home for their husbands to share household responsibilities.

The economic role of children also has changed. Today, despite the fact that many teenage children work, they rarely assist the family financially. Instead, many teenagers are expected to pay for their own amusements.

Emotional support

The provision of emotional nourishment (including love, affection, and intimacy) to its members is an important core function of the contemporary family. In fulfilling this function, the family provides support and encouragement and assists its members in coping with decision making and with personal or social problems. To make it easier for working parents to show their love, affection, and support to their children, greeting card companies have been increasingly creating cards for parents to give to their children (vice versa)

Suitable family lifestyle

Another important family function in terms of consumer behavior is the establishment of a suitable lifestyle for the family. Upbringing, experience, and the personal and jointly held goals of the spouses determine the importance placed on education or career, on reading, on television viewing, on the learning of computer skills, on the frequency quality of dining out, and on the selection of other entertainment and recreational activities.

Family lifestyle commitments, including the allocation of time, are generally influencing consumption patterns.

The word dynamics means ‘force’. Group dynamics means the study of forces within a group. Since human beings have an innate desire for belonging to a group, group dynamism is bound to occur. In an organization or in a society, we can see groups, small or large, working for the well-being.

The social process by which people interact with each other in small groups can be called group dynamism. A group has certain common objectives and goals and members are bound together with certain values and culture.

In organizational development, group dynamics refers to the understanding of behaviour of people in groups that are trying to solve a problem or making a decision. A good manager can act as a facilitator and assist the group in accompanying its objectives and arrive at correct decisions.

Because people gather in groups for reasons other than task accomplishment, group process occurs in other types of groups such as personal growth groups (e.g., encounter groups, study groups, prayer groups). In such cases, an individual with expertise in group process can be helpful in the role of facilitator.

Importance of Group Dynamism:

1. The group can influence the thinking of its members. The members are always influenced by the interactions of other members in the group.
2. A group with a good leader performs better as compared to a group with weak leader.
3. The group can give the effect of synergy, that is, if the group consists of positive thinkers then its output is more than the double every time.
4. Group dynamism can give job satisfaction to the members.
5. The group can also bring team spirit among the members.
6. Even the attitude, perceptions, and ideas of members depend on group dynamism. For example, the negative thinkers can be converted to positive thinkers with the help of the facilitator.
7. If the group works as a cohesive group, the cooperation and convergence can result in maximiza­tion of productivity.
8. Lastly, group dynamism can reduce the labour unrest and labour turnover due to emotional attach­ment among the group members.

Types of Groups:

Groups can be classified in a number of ways like by structure, by regularity of contact, by size, by membership. Sometimes groups are differentiated in terms of size or complexity but it is very difficult to state which group to be considered as large or small.

It is seen that in some groups a single member knows only a few of the group’s members personally or is fully aware of roles or activities each member has to play where as in small groups every member knows each other personally and are also aware of the specific roles or activities in the group. For example, each member of the college science club is likely to know others in the club and is also aware of their duties and interests within the group.

1. Primary Group and Secondary Group:

If a person interacts on regular basis with other individuals, then these individuals can be considered a primary group. Interaction can be with members of the family, with the colleagues, with neighbours etc., this means whose opinions are valued by that person, on the other hand, if a person interacts only occasionally with others, or whose opinions are not important, then this type of group is called secondary.

Difference:

Primary and secondary groups can be distinguished on the basis of perceived importance of the group to the individual and the frequency with which the individual interacts with them.

Formal Group and Informal Group:

This is the second useful way to classify groups on the basis of their formal nature. If a group has a highly defined structure, specific roles and authority levels and specific goals then this is called a formal group. For example, in an organization a list of all employees (defined structure), Managing Director, Manager, Assistants etc., (specific roles and authority levels), this shows a formal group.

Goals may be different for different organisations like to assist the homeless, working for the benefit of old people or marketing goals-Increasing sales, promoting the product etc. In these kinds of groups members have a vested interest towards a specific -goal, therefore, they are classified as a formal group.

On the other hand, if a group is more loosely defined, then it is an informal group. For example, four five girls who become friends in the school and now meet only once a month. For the marketer, informal social groups are more important because of loosely defined structure a more conducive environment is available for exchange of information to the members.

Membership Group and Symbolic Group:

Membership Group is a group to which a person belongs or would qualify for membership. For example, college alumni association, IMA, association of doctors, tennis club etc. Symbolic group is a group in which an individual is not likely to receive membership even if he/ she acts like a member by adopting that group’s values, behaviour and attitude. For example, for youngsters cricketers like Sachin Tendulkar, Sourav Ganguly etc. may constitute a symbolic group. They try to identify with these players by imitating their behaviour like the style or sometimes by purchasing specific brand of bat, gloves, dress, ball etc.

Even after this, youngsters probably will never qualify for membership as a professional cricketer. Now-a-days marketers are using the celeb­rity for advertising their products, so that people aspire to become like them after owning and using those products. Studying these groups is very important to the marketer as they exert the greatest potential influence on the consumption decisions of an individual.

Consumer Relevant Groups:

To understand in detail the kind of impact specific groups has on individuals, let us study six basic consumer relevant groups:

The Family:

It is seen, that from childhood an individual needs and consumption decisions are influenced by his/her family. Importance of the family in various decisions is based on the frequency of contact that individual has with other family members. Moreover, it is in the family an individual establishes a wide range of values, attitudes and behaviors.

Friendship Groups:

The immediate group which an individual forms after he/she moves out from the house is friendship group. Friendships are also sign of maturity and independence as they represent a breaking away from the family and forming of social ties with the outside world. They are classified as informal groups as they are unstructured and usually lack specific authority levels.

After family an individual’s purchase decisions are most likely influenced by friends. Friends fulfill a wide range of needs like they provide companionship, security and opportunity to discuss the matter which they can’t with the family members.

Friends opinions and preferences are very important for influencing an individual’s behaviour in determining the products or brands he/she actually selects. For example, marketers of products like branded shirts, jewellery and alcoholic beverages depicts friendship situations in the advertisements- ‘Green Label’ -T.V. commercial of alcoholic beverage. Consumers like to seek information from those friends who have values or outlooks similar to their own. The influence of friends will be more in a purchase decision one’s an individual finds greater similarity.

Formal social Groups:

Formal social groups, as the name says, lack intimate relationship and they serve different function for an individual. A person joins this group to fulfill goals like making new friends, pursuing a special interest, meeting important’ people specially for career advancement or also sometimes promoting a specific cause (working for the welfare of orphans).

This type of group interests marketers because members often consume products together, can discuss products or services or stores informally with other members and sometimes can even copy the consumption behaviour of other members whom they admire.

Shopping Groups:

Two or more people who shop together this can be either for food, for clothing or simply to pass the time-can be called a shopping group; people like to shop with others who are pleasant company or who they feel have more experience or knowledge about a desired product or service. Shopping with others reduces the risk that a purchase decision will be socially unacceptable, collective decision is the best in which none of the members knows about the product to be purchased.

Now-a-days, in-home shopping is more common, it consists of a group who gathers together in the home of a friend to attend a “party” which is arranged to demonstrate and evaluate a specific line of products. This kind of approach helps marketers to demonstrate the features of their products simultaneously to a group of potential customers in their surroundings.

Consumer-Action Groups:

Consumer-action groups can be divided into two broad categories: those that organize to correct a specific consumer abuse and then disband, and those that organize to address broader, more pervasive problem areas and operate over an extended or indefinite period of time.

Work Groups:

This type of group also serves as a major influence on the consumption behaviour of members as they spend a sheer amount of time at their jobs (around 48 hours per week). Formal work group consists of those individuals who work together as a team.

Their direct and sustained work relationship offers substantial opportunity for one or more members to influence the consumption related attitudes and activities of other team members. Informal friendship/work groups consists of people who have become friends as a result of working for the same firm, they may/ may not work together as a team. Marketers have recognized that work groups influences consumers brand choices and some­times even the store choice, so now they are redirecting their sales efforts to offices and plants during lunch-hour visits.

In sociology and social psychology, an in-group is a social group to which a person psychologically identifies as being a member. By contrast, an out-group is a social group with which an individual does not identify. People may for example identify with their peer group, family, community, sports team, political party, gender, religion, or nation. It has been found that the psychological membership of social groups and categories is associated with a wide variety of phenomena.

The terminology was made popular by Henri Tajfel and colleagues during his work in formulating social identity theory. The significance of in-group and out-group categorization was identified using a method called the minimal group paradigm. Tajfel and colleagues found that people can form self-preferencing in-groups within a matter of minutes and that such groups can form even on the basis of completely arbitrary and invented discriminatory characteristics, such as preferences for certain paintings.

Associated phenomena

The psychological categorization of people into in-group and out-group members is associated with a variety of phenomena. The following examples have all received a great deal of academic attention.

In-group favoritism

This refers to the fact that under certain conditions, people will prefer and have affinity for one’s in-group over the out-group, or anyone viewed as outside the in-group. This can be expressed in one’s evaluation of others, linking, allocation of resources, and many other ways.

Out-group derogation

Discrimination between in-groups and out-groups is a matter of favoritism towards an in-group and the absence of equivalent favoritism towards an out-group. Out-group derogation is the phenomenon in which an out-group is perceived as being threatening to the members of an in-group. This phenomenon often accompanies in-group favoritism, as it requires one to have an affinity towards their in-group. Some research suggests that out-group derogation occurs when an out-group is perceived as blocking or hindering the goals of an in-group. It has also been argued that out-group derogation is a natural consequence of the categorization process.

Social influence

People have been shown to be differentially influenced by in-group members. That is, under conditions where group categorization is psychologically salient, people will shift their beliefs in line with in-group social norms.

Group polarization

This generally refers to the tendency of groups to make decisions that are more extreme than the initial inclination of its members, although polarization toward the most central beliefs has also been observed. It has been shown that this effect is related to a psychologically salient in-group and outgroup categorization.

Group homogeneity

Categorization of people into social groups increases the perception that group members are similar to one another. An outcome of this is the out-group homogeneity effect. This refers to the perception of members of an out-group as being homogenous, while members of one’s in-group are perceived as being diverse, e.g. “they are alike; we are diverse”. This is especially likely to occur in regard to negative characteristics. Under certain conditions, in-group members can be perceived as being similar to one another in regard to positive characteristics. This effect is called in-group homogeneity.

Postulated role in human evolution

In evolutionary psychology, in-group favoritism is seen as an evolved mechanism selected for the advantages of coalition affiliation. It has been argued that characteristics such as gender and ethnicity are inflexible or even essential features of such systems. However, there is evidence that elements of favoritism are flexible in that they can be erased by changes in social categorization. One study in the field of behavioural genetics suggests that biological mechanisms may exist which favor a coexistence of both flexible and essentialist systems.

Some of the differences between in-group and out-group are as follows:

(1) The groups with which individual identifies himself are his in group. one’s family, one’s college are example of his in group. But out groups refers to those groups with which individual do not identify himself. These are outside groups. Pakistan is an out group for Indians.

(2) In group members use the term ‘we’ to express themselves but they use the term ‘they’ for the members of out-group.

(3) Individual is the member of his in group whereas he is not at all a member of his out group.

(4) In group based on ethnocentrism. Ethnocentrism is one of the important characteristic of in group. But out group is not based on ethnocentrism.

(5) Similarity in behavior, attitude and opinion is observed among the members of in group. But they show dissimilar behavior; attitude and opinion towards the members of out group.

(6) In group members have positive attitude towards their own in group but they have negative attitudes towards their out group.

(7) Members of in group display co-operation, good-will, mutual help and possess a sense of solidarity, a feeling of brotherhood and readiness to sacrifice themselves for the group. But individual shows a sense of avoidance, dislike, indifference and antagonism towards the members of out group.

(8) In group is a group to which individual belongs to but all other group to which he does not belongs to are his out group.

(9) Members of in group feel that their personal welfare is bound up with other members of group but out group members do not feel so.

The most important thing for the marketer is to understand about the role of ‘opinion leadership’ in marketing of goods and services. Opinion leadership which is otherwise known as word of mouth communication is an important personal influence on consumers. With the proliferation of cell phone usage and e-mail, many people are always available to friends, family and business associates. Message spreads like virus among people. Opinion leaders offer advice or information about a product, service and how a particular product may be used. Words of mouth takes place through personal or face to face communication.

Opinion Leadership

Opinion leadership is defined as the process in which one person influences the attitudes or actions of other person informally, who may be identified as opinion leader. They offer informal advice about the product or service. Opinion leaders are part of the social groups. They have social communication network. The communication is informal and interpersonal in nature which happens between those who are not associated with the commercial selling source directly.

Examples of Opinion Leadership

The role of opinion leadership could be seen in the following examples.

1. During casual talk, a friend talks about the car he recently bought. He recommends buying it.
2. A person shows a friend photographs of his recent tour abroad. He suggests that by using a particular make of camera, better pictures could be shot.
3. A family wants to have a swimming pool in their spacious house. The family head asks neighbors which pool construction company they should call.
4. A parent wants admission for his child in a particular school. He contacts other parents sending their children to the same school.

Characteristics of Opinion Leaders

Opinion leadership is a dynamic process. It is the most powerful consumer force. As informal communication sources, it effectively influences consumers in their product related decisions. The dynamics of the opinion leadership may be discussed under the following headings:

1. Credible source of information,
2. Provision of both positive and negative product information,
3. Source of information and advice,
4. Two-way street,
5. Specific characteristics.

(A) Credible Source

Opinion leaders are knowledgeable. Their advice about a product or service is considered reliable. As opinion leaders are informal sources of information, it is perceived that they give advice in the best interest of opinion seekers. The first hand information received from opinion leaders helps in reducing perceived risks. It properly tackles the anxiety in buying new products as the opinion is based on the first hand experience.

(B) Provision of Both Positive and Negative Product Information

Marketers provide information which is invariably favorable to the products they are marketing. But opinion leaders are not directly associated with marketers. They provide both favorable and unfavorable information about the product. So, opinion seekers have faith in opinion leaders. They are confident that they are receiving both positive and negative information in an accurate way.

(C) Sources of Information and Advice

Opinion leaders are the source of both information and advice. They simply share their experience about a product or service. Their talk is related to what they know about a product. In their more aggressive talks, they advise others to buy or avoid a specific product. They base their advice on proper reasons.

(D) Two-way Street

Opinion leaders in one product related situation become opinion receivers in another situation even for the same product. For example, a new homeowner thinking of buying a lawn mover seeks information and advice from other people about which brand to select. After purchasing the lawn mover, he may be satisfied with the product (in the post purchase experience). Now he has a compelling need to talk favorably about the purchase to other people to confirm the correctness of his choice. In the first instance, he is an opinion receiver and in the second he is an opinion leader.

Sometimes, an opinion leader is influenced by an opinion receiver. For example, a person may recommend a favorite hotel to his friend. In response the opinion receiver gives his own comments on that hotel. Finally, the opinion leader may come to realize that the hotel is too small, too isolated and offers fewer amenities than other hotels.

(E) Specific Characteristics

Opinion leaders possess distinct personality traits. These include self-confidence and gregariousness. They are socially inclined, outspoken and are knowledgeable.