Assignment 2nd_523_Business Mathematics and Statistics

Department of Business AdministrationBlock No. 13, Sector H-8,Allama Iqbal Open University, Islamabad.

Business Mathematics and Statistics (523)Assignment No. 02

Submitted to:Mr. Tanvir AhmedDepartment of Business Administration, Block 13, Allama Iqbal Open University (AIOU)Sector H-8, ISLAMABAD(0333-533 6631)

Submitted by:Muhammad Hammad Manzoor

MBA (HRM) – 2nd Semester Roll No. 508195394

508, 5th Floor, Continental Trade Centre (CTC) Block – 08, Clifton, KARACHI

(0321-584 2326, 0322-555 5901)

Business Mathematics and Statistics (523)

ACKNOWLEDGEMENT

All praises to Almighty Allah, the creator of the Universe who blessed me with the

knowledge and enabled me to complete this research. I feel great pleasure and

honor to express my sincere gratitude and heartfelt thanks to my worthy subject

faculty member Mr. Tanvir Ahmed Sab, for his guidance, encouragement and

friendly attitude during the present study and throughout the period of M.B.A

(Semester II).

I pay my thanks to all the Faculty of the Department & AIOU Karachi Campus Staff

for their kind support, constructive criticisms and real encouragement. I wish to

thank Ms. Madiha Ahmed Khan for valuable discussions and knowledge sharing

during the completion of this project. I further wish to record my thanks to all my

students, class fellows, well wishers and especially Unilever Pakistan Management,

Akhtar Naseem, Usman Javed (Manager – Marketing), Mr. Khizar Iftikhar, Khurram

Shahzad, Rehan Hassan, Sohail, Waleem, Javed for their help, valuable suggestions,

whole hearted cooperation and prayers.

Finally, I owe all my academic success and progress in life to my loving parents and

sisters, whose affection, endless prayers, good wishes and inspiration remained

with me for higher ideals of life.

M. Hammad Manzoor

2By: M. Hammad Manzoor, MBA HRM-II, 508, 5th Floor, Continental Trade Centre (CTC), Clifton – 08, Karachi. (Roll No. 508195394)


ABSTRACT

The study had been carried out by keeping in mind about the selection

criteria for and use of Measures of Variables in Unilever Pakistan Limited.

Unilever & Dalda (Pakistan) has been selected for the sake of the data

analysis and working on its merits and demerits, the methodology includes

the evaluation of the different variable relations, that how they work and

variable correlation analysis could be make. A case study has been selected

from Unilever Pakistan. After analyzing the case study using different

technique, results and conclusions were worked out from Unilever & Dalda or

which lead the study for further SWOT analysis.

SWOT analysis had been carried out and conclusion followed by

recommendations had been made in this regards.



Sr. No.

Contents Description Page No.

1 Introduction What is Statistics? Descriptive Statistics Measures of Relationship

5-8

2 Review of Literature Scatter Plot Pearson Product Moment Correlation Spearman’s Rank Correlation Coefficient Phi Coefficient Linear Regression Regression Analysis

8-21

3 Unilever Pakistan & Dalda Company Profile Data Collection Methodology & Analysis Conclusions

22-40

4 Data Analysis Demerits and Deficiencies Merits & Strengths

41-43

5 Recommendations 44

6 References 45



Introduction

What is Statistics?

The mathematics of the collection, organization, and interpretation of numerical data, especially the analysis of population characteristics by inference from sampling.

In applying statistics to a scientific, industrial, or societal problem, it is

necessary to begin with a Population or process to be studied. Populations

can be diverse topics such as "all persons living in a country" or "every atom

composing a crystal".

A population can also be composed of observations of a process at various

times, with the data from each observation serving as a different member of

the overall group. Data collected about this kind of "population" constitutes

what is called a time series.

For practical reasons, a chosen subset of the population called a Sample is

studied — as opposed to compiling data about the entire group (an operation

called Census). Once a sample that is representative of the population is

determined, data are collected for the sample members in an observational



or Experimental setting. This data can then be subjected to statistical

analysis, serving two related purposes: description and inference.



Descriptive statistics summarize the population data by describing what was observed in the sample numerically or graphically. Numerical descriptors include mean and standard deviation for continuous d35302976ata types (like heights or weights), while frequency and percentage are more useful in terms of describing categorical data (like race).

Inferential statistics uses patterns in the sample data to draw inferences about the population represented, accounting for randomness. These inferences may take the form of:

Answering yes/no questions about the data (hypothesis testing) Estimating numerical characteristics of the data (estimation) Describing associations within the data (correlation) and modeling

relationships within the data (for example, using regression analysis).

Inference can extend to forecasting, prediction and estimation of unobserved values either in or associated with the population being studied; it can include extrapolation and interpolation of time series

or spatial data, and can also include data mining.



What is Measure of Relationship?

“Indices enabling the researcher to indicate the degree to which two sets of scores are related”

What is Correlation?

“Determines whether and to what degree a relationship exists between two or more quantifiable variables, the degree of the relationship is expressed as a coefficient of correlation”

OR“Correlation is a statistical technique that can show whether and how strongly pairs of variables are related.”

Pearson product-moment correlationo Used with interval or ratio data

Spearman rank-order correlation

o Used when one variable is ordinal and the second is at least ordinal

Scatter plots

o Visual representation of a correlationo Helps to identify nonlinear relationships

What are Correlation Coefficient?

Correlation coefficients are measures of the degree of relationship between two or more variables. When we talk about a relationship, we are talking about the manner in which the variables tend to vary together. For example, if one variable tends to increase at the same time that another variable increases, we would say there is a positive relationship between the two variables. If one variable tends to decrease as another variable increases, we would say that there is a negative relationship between the two variables. It is also possible that the variables might be unrelated to one another, so that you cannot predict one variable by knowing the level of the other variable.



As a child grows from an infant into a toddler into a young child, both the child's height and weight tend to change. Those changes are not always tightly locked to one another, but they do tend to occur together. So if we took a sample of children from a few weeks old to 3 years old and measured the height and weight of each child, we would likely see a positive relationship between the two.

A relationship between two variables does not necessarily mean that one variable causes the other. When we see a relationship, there are three possible causal interpretations. If we label the variables A and B, A could cause B, B could cause A, or some third variable (we will call it C) could cause both A and B.

With the relationship between height and weight in children, it is likely that the general growth of children, which increases both height and weight, accounts for the observed correlation. It is very foolish to assume that the presence of a correlation implies a causal relationship between the two variables.

Scatter Plots & Linear Relationship:

A helpful way to visualize a relationship between two variables is to construct a scatter plot, which you were briefly introduced to in our discussion of graphical techniques. A scatter plot represents each set of paired scores on a two dimensional graph, in which the dimensions are defined by the variables.

For example, if we wanted to create a scatter plot of our sample of 100 children for the variables of height and weight, we would start by drawing the X and Y axes, labeling one height and the other weight, and marking off the scales so that the range on these axes is sufficient to handle the range of scores in our sample.

Let's suppose that our first child is 27 inches tall and 21 pounds. We would find the point on the weight axis that represents 21 pounds and the point on the height axis that represents 27 inches. Where these two points cross, we would put a dot that represents the combination of height and weight for that child, as shown in the figure below.



We then continue the process for all of the other children in our sample, which might produce the scatter plot illustrated below.



It is always a good idea to produce scatter plots for the correlations that you compute as part of your research. Most will look like the scatter plot above, suggesting a linear relationship. Others will show a distribution that is less organized and more scattered, suggesting a weak relationship between the variables. But on rare occasions, a scatter plot will indicate a relationship that is not a simple linear relationship, but rather shows a complex relationship that changes at different points in the scatter plot.

The scatter plot below illustrates a nonlinear relationship, in which Y increases as X increases, but only up to a point; after that point, the relationship reverses direction. Using a simple correlation coefficient for such a situation would be a mistake, because the correlation cannot capture accurately the nature of a nonlinear relationship.



Pearson Product-Moment Correlation

The Pearson product-moment correlation was devised by Karl Pearson in 1895, and it is still the most widely used correlation coefficient. This history behind the mathematical development of this index is fascinating. Those interested in that history can click on the link. But you need not know that history to understand how the Pearson correlation works.

The Pearson product-moment correlation is an index of the degree of linear relationship between two variables that are both measured on at least an ordinal scale of measurement. The index is structured so the a correlation of 0.00 means that there is no linear relationship, a correlation of +1.00 means that there is a perfect positive relationship, and a correlation of -1.00 means that there is a perfect negative relationship.

As you move from zero to either end of this scale, the strength of the relationship increases. You can think of the strength of a linear relationship as how tightly the data points in a scatter plot cluster around a straight line. In a perfect relationship, either negative or positive, the points all fall on a single straight line. We will see examples of that later.

The symbol for the Pearson correlation is a lowercase r, which is often subscripted with the two variables. For example, rxy would stand for the correlation between the variables X and Y.

The Pearson product-moment correlation was originally defined in terms of Z-scores. In fact, you can compute the product-moment correlation as the average cross-product Z, as show in the first equation below. But that is an equation that is difficult to use to do computations. The more commonly used equation now is the second equation below.

Although this equation looks much more complicated and looks like it would be much more difficult to compute, in fact, this second equation is by far the easier of the two to use if you are doing the computations with nothing but a calculator.


http://www.mikeraulin.org/graziano7e/statistics/concepts/pearsondev.htm


Spearman's rank correlation coefficient or Spearman's rho:

Named after Charles Spearman and often denoted by the Greek letter (rho) or as , is a non-parametric measure of statistical dependence between two variables. It assesses how well the relationship between two variables can be described using a monotonic function. If there are no repeated data values, a perfect Spearman correlation of +1 or −1 occurs when each of the variables is a perfect monotone function of the other.

The Spearman correlation coefficient is defined as the Pearson correlation

coefficient between the ranked variables. For a sample of size n, the n raw

scores are converted to ranks , and ρ is computed from these:


http://en.wikipedia.org/wiki/Rho_(letter)


Tied values are assigned a rank equal to the average of their positions in

the ascending order of the values. In the table below, notice how the rank

of values that are the same is the mean of what their ranks would

otherwise be:

Variable Position in the descending order

Rank

0.8 5 5

1.2 4

1.2 3

2.3 2 2

18 1 1

In applications where ties are known to be absent, a simpler procedure

can be used to calculate ρ. Differences between the ranks of

each observation on the two variables are calculated, and ρ is given by:



The Phi Coefficient

The Phi coefficient is an index of the degree of relationship between two variables that are measured on a nominal scale. Because variables measured on a nominal scale are simply classified by type, rather than measured in the more general sense, there is no such thing as a linear relationship. Nevertheless, it is possible to see if there is a relationship.

For example, suppose you want to study the relationship between religious background and occupations. You have a classification systems for religion that includes Catholic, Protestant, Muslim, Other, and Agnostic/Atheist. You have also developed a classification for occupations that include Unskilled Laborer, Skilled Laborer, Clerical, Middle Manager, Small Business Owner, and Professional/Upper Management. You want to see if the distribution of religious preferences differ by occupation, which is just another way of saying that there is a relationship between these two variables.

The Phi Coefficient is not used nearly as often as the Pearson and Spearman correlations. Therefore, we will not be devoting space here to the computational procedures. However, interested students can consult advances statistics textbooks for the details. you can compute Phi easily as one of the options in the crosstabs procedure in SPSS for Windows.

Linear Regression

The value of correlations is that they can be used to predict one variable from another variable. This process is called linear regression or simply regression. It involves fitting mathematically a straight line to the data from a scatter plot.

Below is a scatter plot from our discussion of correlations. We have added a regression line to that scatter plot to illustrate how regression works. We compute the regression line with formulas that we will present to you shortly. The regression line is based on our data. Once we have the regression line, we can then use it to predict Y from knowing X.

The scatter plot below shows the relationship of height and weight in young children (birth to three years old). The line that runs through the data points is called the regression line. It is determined by an equation, which we will discuss shortly. If we know the value of X (in this case, weight) and we want to predict Y from X, we draw a line straight up from our value of X until it



intersects the regression line, and then we draw a line that is parallel to the X-axis over to the Y-axis. We then read from the Y-axis our predicted value for Y (in this case, height).

In order to fit a line mathematically, there must be some stated mathematical criteria for what constitutes a good fit. In the case of linear regression, that mathematical criteria is called least squares criteria, which is shorthand for the line being positioned so that the sum of the squared distances from the score to the predicted score is as small as it can be.

If you are predicting Y, you will compute a regression line that minimized the sum of the (Y-Y')2. Traditionally, a predicted score is referred to by using the letter of the score and adding a single quotation after it (Y' is read Y prime or Y predicted).

To illustrate this concept, we removed most of the clutter of data points from the above scatter plot and showed the distances that are involved in the least squares criteria. Note that it is the vertical distance from the point to the prediction line--that is, the difference from the predicted Y (along the regression line) and the actual Y (represented by the data point). A common misconception is that you measure the shortest distance to the line, which will be a line to the point that is at right angles to the regression line.



It may not be immediately obvious, but if you were trying to predict X from Y, you would be minimizing the sum of the squared distances (X-X'). That means that the regression line for predicting Y from X may not be the same as the regression line for predicting X from Y. In fact, it is rare that they are exactly the same.

The first equation below is the basic form of the regression line. It is simply the equation for a straight line, which you probably learned in high school math. The two new notational items are byx and ayx which are the slope and the intercept of the regression line for predicting Y from X. The slope is how much the Y scores increase per unit of X score increase. The slope in the figure above is approximately .80. For every 10 units movement along the line on the X axis, the Y axis moves about 8 units. The intercept is the point at which the line crosses the Y axis (i.e., the point at which X is equal to zero.

The equations for computing the slope and intercept of the line are listed as the second and third equations, respectively. If you want to predict X from Y, simply replace all the Xs with Ys and the Ys with Xs in the equations below.



A careful inspection of these equations will reveal a couple of important ideas. First, if you look at the first version of the equation for the slope (the one using the correlation and the population variances), you will see that the slope is equal to the correlation if the population variances are equal. That would be true either for predicting X from Y or Y from X. What is less clear, but is also true, is that the regression lines for predicting X or predicting Y will be identical if the population variances are equal. That is the ONLY situation in which the regression lines are the same.

Second, if the correlation is zero (i.e., no relationship between X and Y), then the slope will be zero (look at the first part of the second equation). If you are predicting Y from X, your regression line will be horizontal, and if you are predicting X from Y, your regression line will be vertical. Furthermore, if you look at the third equation, you will see that the horizontal line for predicting Y will be at the mean of Y and the vertical line for predicting X will be at the mean of X.

Think about that for a minute. If X and Y are uncorrelated and you are trying to predict Y, the best prediction that you can make is the mean of Y. If you have no useful information about a variable and are asked to predict the score of a given individual, your best bet is to predict the mean. To the extent that the variables are correlated, you can make a better prediction by using the information from the correlated variable and the regression equation.

Scatter Diagrams

• Two related variables, called bivariate data, plotted as points on a graph.



• Each point on the diagram represents a pair of values, one based on the X scale (independent variable) and the other based on the Y scale (dependent variable).

• Making a scatter diagram usually is the initial step in investigating the relationship between two variables, because the diagram shows visually the shape and degree of closeness of the relationship.

• A scatter diagram also indicates whether the relationship between the two variables is positive or negative.



Simple Regression Analysis

Refers to statistical techniques for measuring the relationship between a dependent variable and one or more independent variables. The relationship between two variables is characterized by how they vary together. Given pairs of X and Y variables, regression analysis measures the direction (positive or negative) and rate of change (slope) in Y as X changes, or vice versa. Using the values of the independent variable, it attempts to predict the values of an interval-or ratio-scaled dependent variable.

Regression Analysis Requires Two Operations

• Derive an equation, called the regression equation, and a line representing the equation to describe the shape of the relationship between the variables. The regression line is the line drawn through a scatter diagram that “best fits” the data points and accurately describes the relationship between the two variables. The equation and its line may be linear or curvilinear.

• Estimate the dependent variable (Y) from the independent variable (X), based on the relationship described by the regression equation.

Correlation Analysis Statistical techniques for measuring the closeness of the

relationship between variables.

It measures the degree to which changes in one variable are associated with changes in another.

It can only indicate the degree of association or covariance between variables. Covariance is a measure of the extent to which two variables are related.

Regression and correlation analysis may be either simple or multiple. Simple analysis uses only two variables, one dependent and one independent. Multiple analysis deals with three or more variables, one dependent and two or more independent.

Regression Equation and LineResearchers estimate the regression line using the following equation:

Y = b0+ b1Xi + eI



b0 = the Y intercept when X equals zero b1 = the slope of the regression line, which is the increase or decrease in Y for each change of one unit of X

Xi = a given value of the independent variable

i = the observation number

ei = the error term associated with the ith observation

The model involves parameters that are unknown (b 0 and b1) but can be estimated from sample data. The error term, ei, referred to as “eta,” is also unobservable, but can be estimated from sample data.

The Lack Of Precision Can Be Due To

Complexity of most marketing and other business problems

The functional form of the relationship between the dependent and independent variables may differ from the one selected

Measurement of the variables may be imperfect

Data are typically available only at an aggregate level

Data are based on human behavior, so the error term in the model may account for a “random” component in behavior

Least-Squares MethodA statistical technique that fits a straight line to a scatter diagram by using the shortest vertical distances of all the points from the straight line.

The equation derived by this method will yield a regression line that best fits the data.

Regression coefficients are the values that represent the effect of the individual independent variables on the dependent variable.

Standard Deviation of RegressionThe standard deviation of the Y values from the regression line (Yc). This is also called the standard error of estimate, since it can be used to measure the error of the estimates of individual Y values based on the regression line.

Total DeviationTotal deviation = Unexplained deviation + Explained deviation



The terms “explained” and “unexplained” are used here to indicate whether or not a portion of the total deviation is reduced by the introduction of the X values in computing Yc values. When these values are summed and squared individually, they estimate the explained and unexplained variation of Y.

Coefficient of Determination (r2) The strength of association or degree of closeness of the

relationship between two variables measured by a relative value. It demonstrates how well the regression line fits the scattered points.

It indicates the amount of variation in the dependent variable that is explained by the variation in the independent variable and vice versa.

It is defined as the ratio of the explained variation to the total variation.

When r2 is close to 1, the Y values are very close to the regression line. When r2 is close to 0, the Y values are not close to the regression line.

r2 is always a positive number. It cannot tell whether the relationship between the two variables is positive or negative.

Correlation Coefficient The square root of r2, is frequently computed to indicate the

direction of the relationship in addition to indicating the degree of the relationship.

It is the correlation between the observed and predicted values of the dependent variable.

Since the range of r2 is from 0 to 1, the coefficient of correlation r will vary within the range of from 0 to ± 1.

The + sign of r will mean a negative correlation. The sign of r is the same as the sign of b (the slope) in the regression equation.



Practical Study of

Unilever Pakistan & Dalald

Level Brothers Pakistan Limited

Lever Brothers Pakistan Limited is a multinational organization. Unilever PLC London is its parent company. Unilever is a European based company with headquarters in London, and their shares are quoted at the stock exchange of several European countries. They deal in all kinds of products from animal foodstuff to foods and detergents plus other personal and consumer products. Unilever has its subsidiaries in over 80 countries of the world, to which it spreads its vast knowledge and resources.

William Lever (its originator) commences business in England as a grocer. He established Lever Brothers in 1827 in England Sunlight was the first product of Lever Brothers, which makes the beginning of the marketing of branded products at the same time Margarine Uni was established in Nether Land by Simon Van Berg and Anton Jurgens. These two companies in term of:

Buying raw material

Selling finished goods



Consequently both the companies loosing out money in term of profit. These problems led to think of the mergers in 1930. These two companies merged together and renamed the business as Unilever PLC / the word UNI is taken from margarine Uni and Lever is taken from Lever Brothers. Its head quarter was established in England and Rotter Dam.

Unilever has 500 operating companies in 80 countries. It has 0.3 million employees and turnover of sales in 23000 million pounds. The global business proportion is 60% in Europe 20% in North America and 20% in rest of the world. An identified board of directors control the activities of subsidiary companies throughout the world. Lever Brothers Pakistan Limited started its operations in 1948. A merger of Sadiq Vegetable Oils and Allied Industries existed in Rahim Yar Khan was taken place with Lever Brothers and HVM company based at Karachi. As a result of merger Lever Brothers Pakistan Limited was incorporated as an independent Unilever operating company in 1955. The company is quoted on the Karachi, Lahore and Islamabad Stock Exchanges. Lever Brothers Pakistan Limited has around 1900 employees in Pakistan.

Lever Brothers Pakistan Limited played a dynamic role in boosting consumer products market. It stand at a unique position due to its honesty and integrity. Lever Brothers Pakistan Limited’s main divisions of business are:

Merger With Brooke Bond



Brooke Bond Pakistan Limited was incorporated in 1948. Company’s 40% shares are held by Unilever, 21% by financial institutions, 24% by individuals, and 10% by insurance companies. The company is quoted on Karachi and Lahore Stock Exchange market. The company is manually engaged in the blending, packaging and marketing of tea. It also has a small business in the sale of packing apices. The company employ around 850 persons. And has three manufacturing locations situated in Karachi and Khanewal. It also have three regional sales offices. The head office of the company is located in Karachi.

After the amalgamation of Lever and Brooke Bond, Unilever will have a majority shareholding in the combined company and it will provide a comparable level of technical, management and financial resources. The proposed merger will benefit the consumer in term of price and quality.

Acquisition

Lever Brothers Pakistan Limited acquire the shares of Pakistan Industrial Promoters Limited, Mehran International Limited and Ambrosia International Limited, which is known as Polka Group of Ice Cream Companies.



Product Mix

At present Lever Brothers Pakistan Limited is engaged in marketing of diversified varieties and classes of products and playing a dynamic role in boosting consumer product market. It stand at a unique position due to its honesty and integrity. Lever Brothers Pakistan Limited has both product length and depth i.e. it has by length a largest of product lines available and under each product line there are lots of variants like different weights, 100mg, 500mg, 1000mg, sache pack, family pack or in case of ice creams different brands have lots of flavor available which determines its product depth. So different no of product lines are called product length and no of products in each product line are called depth of product line. Lever Brothers Pakistan Limited’s main product groups are listed below:

Home And Personal Care

Personal Wash (PW)Toilet Soaps

Lifebuoy (Carbolic Soap)Lifebuoy PlusLifebuoy GoldLux (in 4 varieties)Rexona (in 2 varieties)LirilHammanFair & Lovely Soap

Fabrics And Home CareFabric Wash

Surf ExcelPower SurfSunlight Washing PowderSoap Wheel

Home CareVim Dish Washer / ScourersPersonal ProductHair Care

Sunsilk Shampoo (in 7 varieties)Harmony SoapLifebuoy Shampoo



Skin Care

Fair & Lovely Skin Cream and LotionDental Care

Close-up Tooth PastePepsodent

Oil And Dairy Based FoodsBanaspati

DaldaCooking Oil

Dalda Cooking Oil(Soya Bean)Dalda Sunflower OilPlanta

Margarine

Blue BandIndustrial FatsA whole range of product for bakery and oils for the industry.BeveragesLeaf Teas

Yellow LabelYellow Label – DanedarRichbruTop StarTaaza LeafSupremeBrooke Bond

Dust TeasPearl DustRuby DustLaojee

Mixture TeaTaaza

Ice CreamCornetto (in 3 varieties)Feast (in2 varieties)Feast SticklessTop TenStar Cup (in 4 varieties)



Sundae ( 2 variant)Chocu Bar

MinimillSolaJet SpotIce LollyWall’s KulfiPandaPop CornBig Three

Vision Of Lever Brothers Pakistan Limited

The vision of Lever Brothers Pakistan Limited is driven by is the commitment to excel and we are here to sell aspiration not brand. So, the core vision is integrating and that is to excel in every field whatever Lever Brothers do to provide customer delight and value. The Lever Brothers have been able to follow the track set by their vision and to achieve the standards set by their customers.

Mission Statement of Lever Brothers Pakistan Limited

Lever Brothers Pakistan Limited will be the foremost consumer company in Pakistan with the dominant position in laundry, personal wash, skin, ice creams and spreads: a leading position in tea, hair, dental and household care and a sustainably profitable position in cooking oil and fats.

1. We will aim at delivering a 15% UVG rate, hence doubling the size of our business over 5 years and thereby delivering superior value creation.

2. We will achieve this by adopting a broad view of our market by seeking the new opportunities in the core categories of Unilever and by staying closer to all consumers than competitors, understanding their evolving needs and focusing on constant delivery of superior value for our brands through innovation.

3. Competitive advantage will also be developed by driving down relentlessly on relative cost positions and outpacing competition in operational efficiency improvement.



4. We shall build on our strong network of distributors to maximize penetrations and visibility in existing channels and to develop all new channels relevant to our consumers.

5. We shall establish Unilever’s core brands in Afghanistan, building brand loyalty and strong distribution in the market.

6. To achieve these standards of performance, Lever Brothers Pakistan Limited will develop a strategically focussed organization and will motivate its personnel to use its full potential of creativity and commitment. It will also leverage Unilever’s best practices and maintain the highest standards of operational control.

7. Through its commitment to high levels of care and safety for its employees, its consumers and the environment, Lever Brothers Pakistan Limited will be exemplary and will participate in the dissemination of such practices in Pakistan.

Profit

It is considered to be the ultimate measure of Lever Brothers Pakistan Limited’s performance and it is required to maintain and grow their business.

Product Market Domain

This factor indicates where they are going to compete. Lever Brothers Pakistan Limited’s field of operations is the consumer products and business and this is very clearly stated in their mission statement.

Organization Key Value

It defines that what they want. They people of organization to be good at or how do they want them to behave and this very clearly stated in mission statement as always stay responsive to change, go for innovation, employee commitment to organizational objectives and mission and creating value for customers. So, if we check the mission statement through this aspect then we can easily state that they have clearly stated what should be the organizational key values and how to reinforce them.

Critical Success Factor



The central issue of this factor is that what do they have to be good at to succeed in this market or industry. The mission statement outlines this as “adopting a broad view of our market, by seeking the new opportunities in the core categories and by staying closer to all consumers than competitors and understanding their evolving needs and focusing on constant delivery of superior value for our brands through innovation”.

So far them critical success factor is consumer connectivity and commitment to excel and to provide superior value to customers and products of superior quality and value.

Concern For Different Stakeholders

Mission statement describes that what are the obligations to different stakeholders i.e. stockholders, employees, suppliers, customers and community at large. Lever Brothers Pakistan Limited’s mission statement contains concerns about all stakeholders. First be foremost consumers and then other stakeholders and describes it as: “Through its commitment to high level of core and safety for its employees, its consumers and environment. Lever Brothers Pakistan Limited will be exemplary and will participate in the dissemination of such practices in Pakistan”.

Form And Sources Of Competitive Advantages

Mission statement of Lever Brothers Pakistan Limited completely describes the form and sources of competitive advantage as:

“Competitive advantage will be developed by driving down relentlessly on relative cost positions and outpacing competitor’s in operational efficiency improvements and through building strong network of distributors and by developing a strategically focused organization and by motivating its personnel to use its full potential of creativity and commitment and by maintaining the higher standards of operational control”.

They are going for unique combination of cost reduction and superior value to customers so they entirely provide the form and source of competitive advantage that what they wanted to achieve and how they will achieve it.



Objectives Of Lever Brothers Pakistan Limited And Attainment Of Objectives

Objectives of Lever Brothers Pakistan Limited

1. Their main objective is to have a double-digit growth and resultant cash flows will be utilized in improving the product quality and contents to enhance the value to customer and final users.

2. Lever Brothers Pakistan Limited has an objective to have a responsive supply chain and technological based processes.

3. They want to have consumer connectivity, i.e. they want to know what they eat, drink, how they spend their lives, what are their preferences. So in this way they wan to be very close to customer, to know their real insight and desires so they can develop new strategy for product design and can implement their strategy in better manner i.e. avoidance of hit and trial approach and hitting the right target with right strategy at right time in right and accurate manner.

4. They want to be cost efficient i.e. they want to reduce in their cost of production, cost of transportation, distribution and packaging cost and finally reducing all the human cost to offer a competitive price to customer maintain the high standards of quality.

5. To have a partnership with their suppliers to enable them to provide high quality low cost material.

6. Have entered and will be aggressively developing new markets.

7. Be exciting to their customers with stream of innovative products.

8. To be no in all their existing markets.

Attainment Of Objectives

An objective or set of objective to be ideal must be “SMART” i.e.1. Specific2. Measurable



3. Attainable4. Realistic5. Time frame

Specific

The objective of Lever Brothers Pakistan Limited are specific not general e.g. they want to be number one i.e. market leader in terms of market share. They want to be cost efficient it is specific i.e. they have to reduce their costs without compromising on quality. They want to have focused strategic thrust i.e. they are to simply reduce non-valuable slow moving product. So the non-value added products are quite obvious with their sale figure and popularity.

Measurability

Objectives of Lever Brothers Pakistan Limited are measurable as you can easily measure the double-digit growth with their balance sheet footings and cash flow analysis. Reduction in cost easily be measurable from reduced price level and cost of production. Responsive supply chain objective can easily be measured with quantity of real information available on computer terminals of Lever Brothers Pakistan Limited.

Attainable

All of the objectives are attainable. They can be market leader e.g. they are in Lux, Blue Band, Fair & Lovely, Lipton and Supreme. They have portfolio and cash flows to invest in their product categories to achieve their quality standards thereby becoming market leader with their increased share, sales and growth. Thereby getting brand loyalty among their customers.

Reliability

One has to be at the top so to be number one in its realistic objectives. Other objective e.g. reduction in cost is realistic, you an reduce your cost by focusing on value chain. Cost of inbound and outbound logistics.

The objective of launching innovative products is also realistic objective, it comes only from creative ideas and implementation of these innovative ideas comes up from investment.



DALDA

Dalda’s story begins in early 1930s when Hindustan Vanaspati Manufacturing Co (today’s Hindustan Lever Limited) wanted to start manufacturing Vanaspati locally. At that time hydrogenated vegetable oil was imported in India by a Dutch company, Dada & Co. Dada & Co, insisted that the branded product should reflect their name, hence in a bid to establish their ownership of the brand Hindustan Lever introduced the letter ‘L’ for Lever into the name; and thus was born DALDA, one of the longest-living brands in India. Dalda came to be synonymous with the Vanaspati (hydrogenated vegetable fat) genre.

Dalda Banaspati through its promise of superior quality & taste has won the hearts millions of consumers making it not only a household name in the sub-continent by synonymous with the genre vanaspati. Dalda, in its quest to meet the changing needs of its consumers; entered the oils segment through the launch of Dalda Cooking oil.

In July 2004, Unilever Pakistanaccepted the offer of Rs. 1.33 Billion for the sale of its "Dalda" brand to Westbury Group in collaboration with Unilever Employee Welfare Group, who formed a separate company under Dalda Foods (Private) Ltd.. Dalda Foods (pvt) ltd took Dalda’s over 60 years of heritage combined with continuous innovation and in depth consumer understanding and maintenance of high quality standards has made it the leading brand in the Cooking Oil and Fats industry. Within a short span of 6 years Dalda Foods expanded its Brand Portfolio through:

the launch of Manpasand; to meet the needs of the vast middle-income segment. Manpasand Banasapti and Cooking oil was launched at end-2005 and has grown to become one of the most formidable players in the industry.

to seize the opportunity arising from changing consumer lifestyles and increased health awareness; the company entered the pure-oil segment in early 2007.

In a bid to expand capacity and further strengthen position in the premium segment and enter the lower-income segment; Dalda Foods acquired the brand “Tullo” & “Pride” from Wazir Ali Industries in January 2007

Today Dalda Foods has become one of the largest foods FMCG organizations in Pakistan leading the local category of oil and fats. In Pakistan, Dalda has now diversified into Canola and Olive Oil product variants as well.

Hydrogenated oils are main source for Trans fats. Of all the fats, trans fatty acids are considered to have an adverse effect on blood lipids and immune system.] Dalda is the only brand in Pakistan which produces a vanaspati


http://en.wikipedia.org/wiki/Trans_fat

http://en.wikipedia.org/w/index.php?title=Dalda_Foods_(Private)_Ltd.&action=edit&redlink=1

http://en.wikipedia.org/w/index.php?title=Dalda_Foods_(Private)_Ltd.&action=edit&redlink=1

http://en.wikipedia.org/wiki/Unilever_Pakistan

http://en.wikipedia.org/wiki/Vanaspati

http://en.wikipedia.org/wiki/India


(hydrogenated oils) which is the most popular brand in Pakistan, which happens to be VTF (virtually trans fats free). VTF means that content of Trans Fats in Dalda Vanaspati is less than 1% as against other ordinary vanaspati brands which contain around 20-25% trans fats.



Assessing relationship among performance, managerial

practices, Sales-force AutomationA study on Unilever & Dalda Pakistan

Introduction:Because of the increasing cost, competition in the market companies want to have such measurement procedures that increase their per capita income and the market share. Certain procedures were adopted and it is the critical responsibility of the sales manager and the organization to identify the gaps which are lacking behind to lose the profit of the company. Sales force is the backbone of all the companies all over the world. Due to its correct use the profitability of the company is maximized. The procedures adopted must be to the desire and consent of the sales force. If they are poorly designed than it leads to lower motivation level, aptitude and skill level. If they are not properly trained they role conflict, role ambiguity and role accuracy. Now a day the sales manager are focusing on the conversion of the new customers and the retention of existing customers. An efficient sales person is the one which is emotionally intelligent; his interpersonal and intrapersonal communication powers will be strong and sales force automation is entirely dependent on it and its an essential quality of the manager. Problem statement:Why the sales force managers of Pakistan are not acquiring the same profitability mode as it is acquired in the foreign countries which variables are not identified and ignored that caused the decreases in the profitability of the company?

Research methodology:

Subject:Sales force managers working in Unilever & Dalda which are directly related to the distribution channels is the targeted population. Rawalpindi\Islamabad is the universe of study.

Instrument:

Primary data was collected through Questionnaires from Unilever and Dalda companies.

Secondary data is collected through literature review of Topics from related books will be searched Reports will be studied Training Manuals Research papers downloaded from the net.



Sales record Official Records etc.

Procedure and statistical method: 135 questionnaires were distributed among the sales personal of Unilever

&Dalda. 70% responded accurately which made our study precise and scrupulous.

The obtained data is analyzed through Statistical Package for Social Sciences(SPSS) version 12.The statistical methods involved those of descriptive statistics are Mean, Standard Deviation &Pearson Correlation

Technique:Stratified random sampling technique was used for the analysis of data.

Sample characteristics:The sample consists of 65 Unilever (dark green) and 70 (light green) Dalda distributors as indicated in the chart which are independently working in their organization and are doing well in the tracking the order of the sales, inventory level, customer history.

Biographical questionnaire:The biographical questionnaire was a self-developed questionnaire that incorporated the following personal information of the respondents, gender, home language, marital status, age, race, job classification, education, qualifications, job grade and tenure.



Dimensions of the questionnaire:• Motivation shows the relationship between the task and performance and how they are motivated.

• The role perception component attached to the position of salesperson in any firm represents the set of activities or behaviors to be performed by any person occupying that position.

Aptitude Level is the intellectual ability of the person to perform the job.

• Automation the process of obtaining, organizing and analyzing the data which is helpful for sales.

• Satisfaction is put up as an independent variable as proved by walker Churchill and Lawrence Franzi.

Results and findings:Major predictors of sales force automation:

Table. 01 Descriptive Statistics

The major predictors of the study are the satisfaction, automation, role perception, aptitude and motivation having an average mean of 90.38, 82.26, 64, 36, 79.38 and 79.77 respectively as shown in table 1.

Correlation of satisfaction with independent variables:

According to results satisfaction is positively correlated to the independent variables as shown in table 2. The independent variable satisfaction is .679(**) correlated to motivation, .564(**) with aptitude, .834(**) with role perception, .846(**) with automation at significance level of 0.01**.



Table. 02 Correlation

Major predictors of automation regression analysis:



The regression coefficient gave a value of 0.729 which is greater than o.o5 which employees that the regression equation best fits in the model.

The model further elaborated the regression equation showing the major predictors the study at the df 4 the F value is 18.415 which is positively correlated

Table. 3

The table 3 shows that at beta .552 of standardized coefficient the significance level is .095 which shows a positive impact of the automation variable. Similarly the role perception, aptitude and motivation variables are significant at .010, .303 and .697 respectively. A new dimension has been identified which is the automation which improves the profitability of the company by



maintaining the customer history in the records and noting the time that how much time is required to convert to the potential customer to generate a productive call. It works as an independent variable increasing the impact gives positive results.



Description of Data:

Automation Question 1: How much time is required to generate a productive call?

The above chart shows that it took 7- 10 min both by the Unilever and Dalda to convert its customers.

Automation question 2: Which sources are used to maintain customer history?

This chart shows that a sales person must adopt to maintain the customer history that is, via some specified material which could be the sales card, HHT or personal dairy.



Automation question 3: Automation increases the profitability?

The chart shows automation increases the profitability of the organization whether it is Unilever or Dalda

Automation question 4: Automation saves time?

This chart illustrates that Automation is less time consuming and thus provide more good results and ultimately the profitability of the organization.



Conclusion :

Automation which has been proven by the study and is added to the model which has an important impact on the profitability of the company as shown in 3. So a company must focus on this aspect in order to acquire the maximum market share which Dalda and Unilever has done and is going on effectively.

Suggested model with addition of variable:

Fig. 03 New Model : With addition of variable automation

The important functions of automation are as followed:

• The sales force automation systems can improve the productivity of sales personnel. Rather than write-out sales orders, reports, activity reports, and/or call sheets, sales people can fill-in prepared e-forms. This saves time.



• Rather than printing out reports and taking them to the sales manager, sales people can use the company intranet to transmit the information. This saves time.

• Rather than waiting for paper-based product-inventory data, sales prospect lists, and sales-support information, they will have access to the information when they need it. This could be useful in the field when answering prospects’ questions and objections.

• The additional tools could help improve sales staff morale if they reduce the amount of record keeping and/or increase the rate of closing. This could contribute to a virtuous spiral of beneficial and cumulative effects.

• These sales force systems can be used as an effective and efficient training device. They provide sales staff with product information and sales technique training without them having to waste time at seminars.

• Better communication and co-operation between sales personnel facilitates successful team selling.

• More and better qualified sales leads could be automatically generated by the software.

• This technology increases the sales person’s ratio of selling time to nonselling time. Non-selling time includes activities like report writing, travel time, internal meetings, training, and seminars.



Merits, Demerits, Strengths and Deficiencies:

Merits & Strengths:• Unilever PLC England the parent company all over the world gives

assistance to Lever Brothers Pakistan Limited so Lever Brothers Pakistan Limited enjoys a high level of support from Unilever.

• Another major source of strength for Lever Brothers Pakistan Limited is its product targeting all income groups. Lever Brothers Pakistan Limited is providing products total income groups i.e. providing quality with economy as well e.g. Wheel washing powder, Breeze beauty soap, Taza Chai, etc.

• Lever Brothers Pakistan Limited is the oldest company operating in Pakistan which gives him a commanding position is Pakistan to certain extent.

• Lever Brothers Pakistan Limited enjoys the services of highly professional management in the area of sales, marketing, technical and production.

• Lever Brothers Pakistan Limited has such a strong goodwill in the market that some of its brand names has become the generic names for those products such as Surf for detergents and Dalda for ghee.

• Lever Brothers Pakistan Limited is the largest producer of consumer products in Pakistan and has strong brands in every field such as Close Up, Dalda, Surf, Lifebuoy, Lux, etc.

• Lever Brothers Pakistan Limited having the biggest shares in tea market having the biggest brand Lipton and Brooke Bond.

• They are market leader in ice cream business of Polka i.e. horizontal integration with hostile takeover they have captured their competitors thereby reducing competition.

• The company has the assets of more than 5 billion. So, it can invest further product innovation and development.

• It has the largest and efficient distribution network then any its competition.

• Lever Brothers Pakistan Limited is the only company in Pakistan which has its own corner research department.

• The company is very strong financially.



Demerits and Deficiencies:• Lever Brothers Pakistan Limited unable to capture shampoo and

toothpaste market i.e. low market share. • New variants of the company were not able to sustain in the market such

as harmony. • Lever Brothers Pakistan Limited is relatively week in their innovation

department i.e. being first to introduce Surf but after that has no major innovation.

• Emphasizing only few products while ignoring others which could give them potential market shares e.g. beverages section.

• Lever Brothers Pakistan Limited go for long term strategies for all their product categories which prove to be a weakness with change in the circumstances and taste, trends of people

Opportunities:• With the help of further advertising their non competing brands can

increase their market share i.e. market penetration strategy. People will definitely go for these products as Lever Brothers Pakistan Limited has a sound image in people’s mind. Whatever the brand is being sold is mostly on the basis of brand loyalty.

• They have capital to invest they can explore new product categories e.g. in food and beverages they can develop new products like Rafhan has launched custard, jelly, kheer mix, rasmalai mix, etc. through it again will broaden their product categories and will make their operations complex but this could be avoided with “sub contracting” i.e. strategic partnership with their suppliers. These products can prove a “cash cows” as customer in Pakistan always welcome food items especially they will welcome due to brand image of Blue Band and Dalda ghee in food category and due to Lipton and Supreme in beverages category.

• Lever Brothers Pakistan Limited relaunches most of its products with same name or little change in the name e.g. Surf Micro to Surf Extra, ,then to Surf Ultra and then to Surf Excel, with little change of name and little changes in its formula. If Lever Brothers Pakistan Limited launch its products with in prevailing product categories, with entirely new name and new formula then they can capture new market shares as it will gain capture the attention of its target market more as compared to existing one. Though apparently it will increase the advertising cost but it will be compensated with exciting sales as you have to advertise more even in case of relaunch of products with little change in names and formulas. So why not to go for new name and new formula as it will increase your



brand portfolio, it can satisfy the needs of customers which were unsatisfied with the previous brands, its names, its formula, e.g. people used to say Surf fades the clothes, they changed formula and not name only gave it a suffix of Excel i.e. Surf Excel now the people who developed this perception that it fades the color, remain reluctant for long time even after its relaunch and heavy advertisement.

Threats: P&G is giving very serious threats to Lever Brothers Pakistan Limited in

the business of detergents and personal wash and shampoos. No of local companies producing detergents and market them at very low

prices which is a threat to Surf. In the case of ghee and oil business Habib is giving very tough

competition to Lever Brothers Pakistan Limited by introducing its variety of products.

Treat is promoting Bodyguard very much and trying to produce a competition in the carbolic soap market.

Increasing inflation in the country, persistently reducing the purchasing power of the people and dropping people from high price products to low price products e.g. the detergents and providing fuel to the expansion of unorganized sector.

Increased import duties are also adding to the prices of the products and in Pakistan which is a very price for all the firms not only Lever Brothers Pakistan Limited who are using imported raw material.

Threats of new entrants are also present. As ICI is a potential threat in detergents industry, because they are already involved in chemical business and providing raw material for detergent production to different manufacturing companies like Lever Brothers Pakistan Limited and Colgate Palmolive.



Recommendations:

The sales force automation systems should improve the productivity of sales personnel. Rather than write-out sales orders, reports, activity reports, and/or call sheets, sales people can fill-in prepared e-forms. This saves time

Better communication and co-operation between sales personnel facilitates successful team selling.

More and better qualified sales leads could be automatically generated by the software.

Enhance the planning strategy for betterment of the profitability. Rather than printing out reports and taking them to the sales manager,

sales people can use the company intranet to transmit the information. This saves time.

Rather than waiting for paper-based product-inventory data, sales prospect lists, and sales-support information, they will have access to the information when they need it. This could be useful in the field when answering prospects’ questions and objections.

The additional tools could help improve sales staff morale if they reduce the amount of record keeping and/or increase the rate of closing. This could contribute to a virtuous spiral of beneficial and cumulative effects.

Better alarming system should be installed for variable correlation. Enhance the manufacturing plant capacity to get the maximum number Enhance the brand design Enhance HRD to meet the appropriate professional needs for onward

competition Administration department needs to address for of hiring experienced

professionals of the relevant trade.




M. Hammad Manzoor

508195394

# 508, 5th Floor, CTC

Continental Trade Centre, Block-08

Clifton - 08, KARACHI. (0321-584 2326)

Business Math & Stat

52302

Mr. Tanveer Ahmed

Block No. 13,

MBA Department, AIOU, H-8

ISLAMABAD. (0333-533 6631)

Assignment 2nd_523_Business Mathematics and Statistics

Documents

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