THE STRATEGIC ASPIRATIONS OF THE RESERVEBANK OF INDIA

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THE STRATEGIC ASPIRATIONS OF THE RESERVEBANK OF INDIA
The Reserve Bank of India (RBI) is India’s central bank or ‘the bank of the bankers’. It was
established on April 1, 1935 in accordance with the provisions of the Reserve Bank of India
Act, 1935. The Central Office of the RBI, initially set up at Kolkata, is at Mumbai. The RBI is
fully owned by the Government of India.
The history of RBI is closely aligned with the economic and financial history of India. Most
central banks around the world were established around the beginning of the twentieth
century. The Bank was established on the basis of the Hilton Young Commission. It began its
operations by taking over from the Government the functions so far being performed by the
Controller of Currency and from the Imperial Bank of India, the management of Government
accounts and public debt. After independence, RBI gradually strengthened its institutionbuilding capabilities and evolved in terms of functions from central banking to that of
development. There have been several attempts at reorganisation, restructuring and creation
of specialised institutions to cater to emerging needs.
The Preamble of the RBI describes its basic functions like this: ‘….to regulate the issue of
Bank Notes and keeping of reserves with a view to securing monetary stability in India and
generally to operate the currency and credit system of the country to its advantage.’ The
vision states that the RBI ‘….aims to be a leading central bank with credible, transparent,
proactive and contemporaneous policies and seeks to be a catalyst for the emergence of a
globally competitive financial system that helps deliver a high quality of life to the people in
the country.’ The mission states that ‘RBI seeks to develop a sound and efficient financial
system with monetary stability conductive to balanced and sustained growth of the Indian
economy’. The corporate values of underlining the mission statement include public interest,
integrity, excellence, independence of views and responsiveness and dynamism.
The three areas in which objectives of the RBI can be stated are as below.
1. Monetary policy objectives such as containing inflation and promoting economic
growth, management of foreign exchange reserves andmaking currency available.
2. Objectives set for managing financial sector developments such as supervision of
systems and information access and assisting banking and financial institutions to
become competitive globally.
3. Organisational development objectives such as development of economic research
facilities, creating information system for supporting economic decision-making,
financial management and human resource management.
Strategic actions taken to realise the objectives fall under four categories:
1. The thrust area of monetary policy formulation and managing financial sector;
2. Evolving the legal framework to support the thrust area;
3. Customer service for providing support and creationof positive relationship; and
4. Organisational support such as structure, systems, human resource development
and adoption of modern technology.
The major functions performed by the RBI are:
• Acting as the monetary authority
• Acting as the regulator and supervisor of the financial system
• Discharging responsibilities as the manager of foreign exchange
• Issue currency
• Play as developmental role
• Related functions such as acting as the banker to the government and scheduled
banks
The management of the RBI is the responsibility of the central board of directors headed
by the governor and consisting of deputy governors and other directors, all of whom are
appointed by the government. There are four local boards based at Chennai, Kolkata, Mumbai
and New Delhi. The day-to-day management of RBI is in the hands of the executive directors,
managers at various levels and the support staff. There are about 22000 employees at RBI,
working in 25 departments and training colleges.
The RBI identified its strengths and weaknesses as under.
• Strengths A large body of competent officers andstaff; access to key data on the
economy; wide organisational network with 22 regional offices; established
infrastructure; ability to attract talent; and financial self sufficiency.
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• Weaknesses Structural rigidity, lack of accountability and slow decision-making;
eroded specialist know-how; strong employee unions with rigid industrial relations
stance; surplus staff; and weak market intelligence.
Over the years, the RBI has evolved in terms of structure and functions, in response to
the role assigned to it. There have been sweeping changes in the economic, social and political
environment. The RBI has had to respond to it even in the absence of a systematic strategic
plan. In 1992, the RBI, with the assistance of a private consultancy firm, embarked on a
massive strategic planning exercise. The objective was to establish a roadmap to redefine
RBI’s role and to review internal organisational and managerial efficacy, address the changing
expectations from external stakeholders and reposition the bank in the global context. The
strategic planning exercise was buttressed by departmental position papers and documents on
various subjects such as technology, human resources and environmental trends. The
strategic plan of the RBI emerged with four sections dealing with the statement of mission,
objectives and policy, a review of RBI’s strengths and weaknesses and strategic actions
required with an implementation plan. The strategic plan reiterates anticipation of evolving
external environment in the medium-term; revisitingstrengths and weaknesses (evaluation of
capabilities); and doing away with the outdated mandates for enhancing efficiency in
operations in furtherance of best public interests. The results of these efforts are likely to
manifest in attaining a visible focus, reinforced proficiency, realisation of shared sense of
purpose, optimising resource use and build-up of momentum to achieve goals.
Historically, the RBI adopted the time-tested technique of responding to external
environment in a pragmatic manner and making piecemeal changes. The dilemma in adoption
of a comprehensive strategic plan was the risk of trading off the flexibility of the pragmatic
approach to creating rigidity imposed by a set model of planning.
Questions:
1. Consider the vision and mission statements of the Reserve Bank of India. Comment on
the quality of both these statements.
2. Should the RBI go for a systematic and comprehensive strategic plan in place of its
earlier pragmatic approach of responding to environmental events as and when they
occur? Why?

 
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case study of Northern Rock

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case study of Northern Rock
This paper is a case study of Northern Rock, based on this case, there are 4 questions should be answer. First, you need read the case and questions carefully. And
then, following theory requirements of each question combine with case context to answer these 4 questions, this point is very important. Theory request has been shows
in red words under the questions. Relevant reference articles in CSR REF materials file.
Questions:
Guidance, instructions, and questions
Confine your answers to the moral and CSR aspects of this case. You should NOT use the case to express any personal opinions about the nature and operation of modern
capitalism.
YOU MUST USE relevant theory to answer all the following questions.
1    Is the regulation of executive pay possible or desirable? Should the shareholders of Northern Rock take action against the directors? If so, for what reasons?
2    Considering the various stakeholders in Northern Rock, do you agree that savers with Northern Rock should have their savings guaranteed by the government?
Also, does the guarantee savings scheme show that the government does apply some aspects of corporate social responsibility?
3     Who, if any one, carries any moral responsibility for this banking failure?
4     Using this case study, and from the content and discussions within the module, make reasoned predictions on the future use of CSR and ethical perspectives,
within organisational policy making.
Relevant theories:
YOU MUST USE relevant theory to answer all the following questions.
Question 1: Teleological and deontological, a lot of evidence the CEO where been mislead
Question 2: use Milton Fredman theory: he would agree governments should act as a government and business should act as business. However governments have social
response and therefore should look out for both business and people.
2.2) say what CSR is and have different opinions and it’s not a simple answer. Have different points of views
2.3) does the government apply CSR and if so which part of CSR has been carried out
Question3: three categories: personal, organisational and systemic (Schein e, 1985)
Question 4: read Buckholtz and Carol p33. chapter 2
Evolving meaning of CSR
4 dimensions: legal economic ethical and philanthropic
In conclusion: Conclude what you think should have been done better at northern rock i.e: change regulations, more disclosers of pay and bonus, shareholder agreement.
The Case OF Northern Rock:
You may refer to later developments in difficulties of international finance, but only in relation to the questions at the end of the case. You will not receive any
extra marks for extra factual research about the subsequent, so called, banking crisis.
Northern Rock: introduction and context
Northern Rock is a British savings bank that ran into trouble in 2007. Savers queued to take out their money, with loss of interest, so as to protect their capital
invested in the bank. The last ‘run’ on a bank had been 141 years before, with Overend Gurney. Not since that time had there been such a total lack of confidence that
individual customers thought they would be unable to withdraw their money when they wished to do so.
The situation in 2007 was much more severe even than the situation in 1974-75 when the Bank of England had to provide financial support to the Nat West bank. That
intervention happened when all of the following factors came together: (1) inflation peaked at 28% , (2) Gross Domestic Product (GDP), a key measure of national
economic activity fell by what was calculated then as 3%, (3) the government borrowing deficit reached 10% and (4) the government had to go to the International
Monetary Fund for a loan to see it through the crisis.
A run on a bank
Banks usually operate on a ratio of 8:1. That ratio means that the bank takes in £800 million from savers but expects to pay, say £100 million for day to day cash
withdrawals. The bank invests the other £700 million. When confidence in the bank disappears, all the savers try to withdraw their money at the same time. As the bank
cannot pay them all, it freezes customers’ accounts, and literally locks its doors to stop savers withdrawing their money.
One of the roots of the crisis in Northern Rock lay in the difficulties of the American sub prime market.  Loans were provided to people who, because of their income,
or lack of assets, or the type of property being purchased, could not obtain a loan or mortgage. Because of a booming property market from the mid 1990s to 2006, banks
and other lenders allowed much riskier lending to happen. The multiple debt problems of these people led to those debts being brought together into a single source for
the individual. However the basic problem of individuals not being able to pay back their loans remained.
A significant change in lending practices.
In 1970 the maximum mortgage to income ratio was 3:1 – that is 3 times the annual salary of the borrower. Over the next 40 years the ratio gradually rose to 5:1 or
even higher. In addition the borrower was usually expected to provide some of the purchase price of the property. This requirement was to show borrower commitment, the
ability to save, and possibly creditworthiness.  Also, building societies, which provided most of the finance, might include between a quarter and a third of the
partner’s income in calculating the loan.
The reasoning was based on a set of assumptions which, over the last 40 years, no longer apply. These assumptions were that the property would be for owner occupation
by a heterosexual couple of child bearing age, and that the couple would have children within 5 years of the mortgage, hence the restriction on ‘calculable income’ for
the woman, to avoid overstretching regular loan repayments. The recent development of buy to let loans has meant that the assumption of owner occupation is much less
appropriate.
Buy to let
Those people with above average wealth have often owned more than one property. Property companies have grown by buying and letting property. Now the scale of the
activity and the type of people involved in buy to let schemes have both altered. More people have more disposable income, but the main stimulus in buy to let activity
has been increased borrowing opportunities. That has meant rising property prices which has itself attracted more people into the market. Such borrowers have seen an
apparent no risk opportunities.
It could be argued that attitudes to debt have changed over the years, even with the risk of losses in property values. When emotion enters into calculations then
price rises and falls may be more severe than expected from a strictly economic perspective.
Negative equity could develop. This describes the situation when the borrower owes more than the property is worth. If a borrower buys a property for £300,000 with a
100% loan and the property falls in value by 10% then at sale the borrower has a gap of £30,000. (So perhaps the borrower continues to pay the mortgage,  hoping that
prices will rise to eliminate the paper debt). The emotion, before the subsequent anxiety, has been at least greed. Rates of bankruptcy rose sharply in 2007-2008.
Northern Rock collapsed because it had loaned too much money to too many people who could not repay their loans regularly.
Attitudes to debt, and the impact of changing mortgage to income ratios.
In 2008, a financial comparison website estimated that 1 in 10 adults in the UK spend more on a monthly basis than they earn. . Between 1997 and 2007 the number of
credit cards rose from 36 million to 71 million.   According to Standard Life Bank, credit is seen as a way of financing lifestyles rather than reflecting need.
Larry Elliott, Economics editor of the Guardian (26 February 2008:28) used the L’Oreal catchphrase by saying ‘Truly, this is the “because I’m worth it” generation. Our
culture is steeped in a value system that celebrates instant gratification hedonism and selfishness’. But the problem is not that simple. It is possibly not even a
matter of morality. If the deposit plus mortgage ratios of the 1970s are applied to 2007, the total loans available will not be enough to buy even a terraced house in
most parts of the UK, with 2007 salary levels. In September 2007 40% of first time buyers were borrowing above 90% of the cost of the house they were buying. Bank rate
was 5.75%
In 2008 less than 1 in 5 were borrowing more than 90% with a bank rate on the way down. Large mortgages were not available. The situation is made more complicated by
the uneven effects of taxation and benefits, which tend to favour lower income households. The problem of income rising more slowly relative to house prices meant that
people tried to service a loan beyond their ability to make regular repayments.     Northern Rock and other companies made loans that were more than the property was
worth, thus fuelling the consumer boom of the early 21st century.
In 1970 a household income of £30,000 would only have justified a mortgage of £90,000 but in 2008 Northern Rock would have lent £180,000, a mortgage to income ratio of
6:1   A gross personal annual income of £30,000 would only produce about £2200 per month. With the rise in interest rates the mortgage repayments take up more of the
total income, leading to people unable to pay their interest rates.
‘Northern Rock’s “business model” reflected a far higher willingness to make the type of loans outlined above than most other mortgage lenders.’ The company had made
loans that became worth very little. Repossessions nationally rose.
Some specific issues of regulation raised by the collapse of Northern Rock.
A House of Lords enquiry heavily criticised the Financial Services Authority (FSA). The Labour Government between 1997 and 2007 liberalised the City of London. The
style of government regulation became more remote, less detailed. The activities of supervising and regulating the financial institutions were divided between the FSA
and the Bank of England, with both answerable to the Treasury, the government department ultimately accountable to Parliament. But it was unclear to the lenders, the
banks, about who might take regulatory action.
Politically, there were those who wished the bank to fail. Huge salaries paid to business executives led to the view that they should sort things out. However, the
television pictures of angry depositors of Northern Rock caused political problems for the government.
Member of Parliament Vince Cable, a respected commentator on financial management, said ‘The run on Northern Rock was not only a failure of the bank, but also a
failure of regulation. Northern Rock’s managers behaved like a bunch of cowboys and the FSA did nothing to rein them in, or even appear to see there was a problem.’
(Brown C, The Independent, 26th January 2008)
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Research by consulting various sources of information and data

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Please research by consulting various sources of information and data (textbook, company websites, company annual reports, business journals, etc.) and write critical answers on the four questions.
the coursework is :
>>>>> Answer the following five questions, each of which has 20 marks, for a total of 100. The answer to each question should be no longer than 200 words. Your answers need to be consistent across the five questions, so once you have identified a strategy in question 1, please do not change this in subsequent answers, or you will be penalised. If possible, draw (and explain) a suitable figure or diagram for questions 1, 2 and 3.
Q1. Assuming you are a senior manager of the parent firm, below, in which cell of the integration/ responsiveness (I/R) framework would you place the corporate strategy of each of the following five MNEs (200 words):
a) IBM
b) Toyota
c) Huawei
d) Samsung Electronics
e) Google
Q2. What is the appropriate organisational structure consistent with the strategy of each of the five firms in Question 1? (200 words)
Q3. For each of the five firms, discuss any flagship relationships which may exist with its network partners (here make plausible arguments, even if you have no specific data).( 200 words)
Q4. What is the appropriate corporate culture to achieve satisfactory corporate social responsibility and ethical behaviour consistent with the strategy you discuss in Question 1, for each of the five firms? Again, make plausible arguments, whenever possible bolstered by publicly available corporate data.(200 words)
Q5. Now assume that you are a subsidiary manager. Explain how you are implementing the strategies for each of these five firms, consistent with your answer to Question 1.( 200 words)
Moreover , an introduction ( 200 words) and conclusion ( 200 words)<<<<<<<<<
>>>IMPORTANT: * The essential book for this module is ( International Business , Alan M.Rugman & Simon Collinson . It’s good to have a look at the frameworks and theories and understand them as the professor want. Moreover, Annual Reports are important too as the professor mentioned.
>>Format:
We recommend that Notes or Endnotes should be used only if absolutely necessary and must be identified in the text by consecutive numbers, enclosed in square brackets and listed at the end of the essay.
The general format of this submission should include the following parts:
Introduction: a brief explanation of the main objective of this assignment.
Main body: You need to show that you are capable of applying frameworks to the firms you are studying. A good piece of work for this module should focus on a persuasive analysis and argument, critical thinking , logical reasoning and clear presentation. The format is to provide the answer to each question.
Conclusion: a brief summary of the essential arguments/findings for the assignment.
Tables and figures: It is your decision to put the figures/tables separately or in the text. Each figure/table needs to be fully referenced and explained. Please do not insert any of them without explanation.
References: All sources (e.g. books, articles, internet sites) used in the essay must be listed in a reference.
Appendices (if any) <<
> You need to show that you are capable of applying frameworks to the firm you are studying. A good piece of work for this module should focus on a persuasive analysis and argument. The format is to provide the answer to each question. Marks will be awarded for the quality of analytical reasoning and critical thinking.


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Organisations and Behaviour: Organisations and Behaviour Case Study

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In this assignment you are going to use case studies on City College and Enterprise to explore organisational structure and culture and also examine different approaches to management and leadership and theories of both organisations. There are five questions to be answered and must aim for word count of 2500. tip use Definitions about culture from HANDY please. do not use dictionary.
Task 1. Define the word organisation culture and the varies types of culture that are available to an organisation stating advantages and disadvantages of each of them. Identify and describe the different types of organisational structures and cultures and compare and contrast including an argument for and against the structures of city college and Enterprise (LO1.1) Understand relationship between organisational structure and culture. (LO1.2) explain the relationship between an organisations structure and culture can impact on the performance of the business. (LO1.3) discuss the factors which influence individual behaviour at work.
Task 2
Explain the relationship between an organisations structure and culture and the effects that both culture and structure has on an organisations performance. Citing examples from the case study identify and examine in detail the effects that both culture and structure has on the performance of city college. (LO1.2).
Task 3
Define the word behaviour and identify the varies factors that might influence the way individuals behave at work. Using different examples from the case studies, discuss what you would identify as the influencing factors in the way city college behave (LO1.3).
Task 4
Taking the case studies to support your discussion, compare the effectiveness of different leadership styles in the two different organisations. explain the varies approaches to management and leadership theories and their relationships to the way organisations are manages and their importance. (LO 2.1). compare the effectiveness of different leadership styles in different organisations. ie blake and mortiman. (LO2.2) explain how organisational theory underpins the practice of management. LO2.3 evaluate the different approaches to management used by different organisations.
Task 5
From your understanding of the different approaches to management and leadership theories, explain which of these theories you think that both City and Enterprise have adopted. Evaluate the different approaches used by city college and enterprise. You may include examples from other organisations to support your evaluation. LO 2.2 and 2.3. Lo3 Understand ways of using motivational theories in organisations. Lo3.1 discuss the impact that different leadership styles may have on motivation in organisations in periods of change LO3.2 compare the application of different motivational theories within the workplace LO3.3 evaluate the usefulness of a motivation theory for managers. LO4 Understand mechanisms for developing effective teamwork in organisations LO4.1 explain the nature of groups and group behaviour within organisations. LO4.2 discuss factors that may promote or inhibit the development of effective teamwork in organisations. Lo4.3 evaluate the impact of technology on team functioning within a given organisation.
Company A CITY COLLEGE
city college was formed in 2002 as a private college in north west London. It is now part of City group plc. In 2012 city group had an estimated 2.5 million in revenue and employed over 200 staff. In 2010 city group was acquired by a new ownership through a private investor, named Mr Wakefield. City group plc owns 19% of the private college market. All organisations have mission and group mission statement is “To provide inclusive learning opportunities for its students and to succeed in providing comprehensive higher education to the local community”.
. City College want to be the first name people think of when returning back to higher education.
. City College wants to create an organisation where its organisational structure and culture can both help to build a sustainable college.
A mission statement can be used as a starting point to achieve a sustainable business.
City College as expanded recently on its objectives within its mission statement to make the college a much more secure teaching establishment.
City College new mission statement now includes the following corporate objectives.
1. Be reliable 2. Be responsive 3. Understand learners needs 4. Be straightforward.
ELEMENTS AT CITY COLLEGE
The table below shows how the company is organised and the various support functions needed. City college operates both in north and south London.
IMPORTANT FUNCTIONS WITHIN CITY COLLEGE
Operations
In general, City colleges operations are
. Providing higher education for a diverse community
. Producing English and Maths adult literacy classes
. Gathering ideas to share across the company thus improving efficiency
. Managing student learning through individual learning plans
. Implementing sustainable courses for higher education
CITY COLLEGE’S ‘OPERATIONS’ CAN BE SPLIT INTO THREE DEPARTMENTS.
. Teaching operation; Staffs are involved with producing higher education courses that are designed to be inclusive to all learners from diverse backgrounds.
. Human Resource Department; This department is concerned with developing and maintaining the college’s workforce. It is its aim to continue to provide personal professional development to its entire staff. City college invested £1.1 million in its north London branch in facilities and new staff recruitment. This site now has 1500 students enrolled on higher education courses. Operating improvements and growth do not happen y accident. City college encourages employees to come up with good ideas, so these can be discussed, adapted and implemented throughout the business.
In 2005 City college won the number 1 college for education to work Awards 2005. City college is aware its importance to increasing the opportunities for education in the local community. Working with organisations such as Westminster council, city college are able to provide more educational courses to the local community. Working with Westminster council has allowed city college to encourage adults back into education and on the road to a prospective career in business.
ADMINISTRATION
Administrative people
. Solve administrative issues raised by students and internal departments
. Liase with the human resource manager and teachers
. Ensure that the registers are kept up to date and students are informed of important messages
. It is not unusual to find that administration staff to multi-skill and help support other team members within City College. Part of City colleges Culture is to have respect for all staff and support each other through daily operations.
SUPPORT FUNCTIONS
HUMAN RESOURCES
City colleges Human Resources (HR) department focuses on the following areas;
Organisational development including managing change, training and development
. HR Operations including recruitment, selection and employee life cycle
. HR administration
It aims to ensure that City College values are shared across the company and employee satisfaction is increased which in turn can drive and achieve a sustainable college. One area in which HR is involved is recruitment. When a company recruits someone selection will be done by HR and the employing department working together. Induction and training are the next steps. These are also managed by HR and the employing department. HR ensures that once recruited, staff remains. Moreover as people need to develop and maintain skills, HR is usually responsible for staff development. Tarmac’s HR strategy ensures that its corporate values are shared and maintained across the company. Employees are expected to follow its four key corporate values. City College sees these values as essential for helping them to carry out their work day in, day out; they guide us in our dealings with each other and with our customers; ultimately, they are the bedrock of the culture of the company.
STRATEGY, MARKETING AND TECHNICAL
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