Consumerism in Management Education

By Prof. R.N.Venkateswaran MBA Dept., G.M.Institute of Technology, Davangere, Karnataka, India

Introduction: Consumerism is a term used to describe the effects of equating personal happiness with purchasing material possessions and consumption. It is often associated with criticisms of consumption starting with Karl Marx and Thorstein Veblen, but can actually be traced back to the first human civilizations (Wikipedia). In economics, consumerism can also refer to economic policies that place an emphasis on consumption, and, in an abstract sense, the belief that the free choice of consumers should dictate the economic structure of a society (cf. Producerism, especially in the British sense of the term). Management Education Scenario in India:

With the increasing demand for higher education, and the proliferation of institutions offering the same, Education also needs to be considered as a consumable commodity. One of the popular courses of education is the masters course in Business Administration, being offered by universitydepartments, and private institutions. Each institute vies with the other institute in terms of the offerings of wide range of courses, purportedly the specialization courses. The students in these management courses study a variety subjects. Firstly there are the common subjects Core or Basic subjects, which are studied by all students, irrespective of the functional area in which they want to specialize in. Secondly there are the Optional or the Elective courses. These are offered in streams such as: marketing, finance, HR etc., Each stream offers a set of subjects, which the students choose based on their area of interest, and other considerations such as placement, personal job happiness, progression in job etc.,.

Consumerism in education: the knowledge of becoming The July-August 06 number of Le Monde de L'Education (very interesting monthly but in French) is completely devoted to schools, education and learning in the 21st century (and of course oriented to France). One "new" contribution is (in the editors opinion) very interesting. According to him, Consumerism imposes its law. For him, our school system is still a (modern) version of the antique Greek-Roman idea of the school. The individual is a never finished psyche that continues life-long learning, based on its acquisitions during the first years of his life. However, Internet, radio, television, etc have changed the world. Science became part of the economic system and is no longer embedded in politics or religion. Hence, education (and/or science) becomes consumable goods. The first devastating element is that consumerism is a process of non- (or anti-)individualization. But on top of that the school is not adapted to the new pedagogical tools that are audiovisual, Internet based, etc. Schools completely ignore the consequences of these movements: science is no longer concerned with "les savoirs de l'etre" (the knowledge of being), but rather with "les savoirs du devenir" (the knowledge of becoming). Management Dilemma: When education becomes a consumable good, it is necessary to ensure enhanced consumer satisfaction. Thus the b-school managements dilemma is to understand what streams are popular, and offer the courses in those streams. They also have to plan for faculty resources, from within the institute, or from out-source. For this they need to understand before-hand, what streams of courses will run, or likely to run. The decision can be based on hunch, based on historic (past) data. Alternatively, we can use some objective methods, to understand the preferences. This paper attempts to analyze the consumer (students) preferences, based on a data collected through questionnaire. Multivariate analysis is done to give objective insight, to help managements understand and offer the courses according to students preferences. Discriminant Analysis: Discriminant Analysis is a technique for analyzing market research data, when the criterion or dependent variable is categorical and the predictor or independent variables are interval or ordinal in nature.

According to Andy Kennelly, Senior Marketing Research Analyst, Burke, Inc, often you have measured different groups of respondents on many metric variables. Discriminant Analysis is a useful way to answer the questions. are the groups different? On what variables are they most different? Can I predict to which group a person belongs to using these variables? The Discriminant analysis model involves linear combinations of the following form: D = b0 + b1X1 + b2X2 + b3X3 + . + bkXk, where: D = Discriminant score b = Discriminant coefficient or weight X = predictor or independent variable(s). Discriminant Analysis can be two-group or multiple discriminant analysis. In a two group, the criterion variable is dichotomous in nature, i.e. it takes only any one of two values. For e.g. it can be a yes or no to buy an item, or join a company, or selecting a candidate etc., In a multiple discriminant analysis the criterion variable can take more than two values. For e.g. in this study, the student can choose any one of the three streams, viz., Marketing, HR or Finance stream. Formulation of the Problem: The objective criterion was the stream which a student would like to choose. Finance, Marketing, HR are the streams which a student would wish to choose, and choose the various elective courses that are offered under that stream. Hence it becomes a categorical variable: Finance, or Marketing, or HR. This list is also exhaustive and mutually exclusive. i.e. a student who has chosen any one stream, cannot opt for any other stream. A questionnaire was designed to collect data from students, what makes them choose any elective stream. 16 questions were asked of each respondent, which reflect the different aspects of choosing a stream. These are used as the predictor or independent variable. The stream to which a student belongs to, called the choice, is known and recorded. This is the dependent variable.

Methodology: Primary data was collected from students, who are in the second year of the PGDM (Post Graduate Diploma in Management) course, at the KIAMS

(Kirloskar Institute of Advanced Management Studies), Harihar, Karnataka. This formed the sampling frame. A questionnaire was designed, which would cover the various aspects/ considerations which made the students choose the stream they had chosen. The streams identified were: Marketing, HR and Finance, designated as 1,2 and 3 respectively. In all 16 questions were designed, and the students evaluated them on a 1 7 scale, 1 being the lowest, and 7 being the highest. (Ref. Annexure A) The method of sampling was one of convenience sampling. i.e. those second year PGDM students who responded formed the sampling unit. The data was analyzed using SPSS ver. 11.5, using Discriminant analysis methods.

Analysis & Findings:

In all 37 cases were processed. All were valid, and with no missing values.
Analysis Case Processing Summary Unweighted Cases Valid Excluded N 37 Missing or out-ofrange group codes At least one missing discriminating variable Both missing or out-of-range group codes and at least one missing discriminating variable Total Total 0 Percent 100.0 .0

.0

.0

0 37

.0 100.0

Boxs Test:
Box's Test of Equality of Covariance Matrices of Canonical Discriminant Functions
Log Determinants Log Determinant .108 -.467 .043

CHOICE 1 2 3 (identity matrix)

Rank 2 2 2

2 .000 The ranks and natural logarithms of determinants printed are those of the group covariance matrices of the canonical discriminant functions. Test Results Box's M F 2.526 .379 6 5995.131

Approx. df1 df2 Sig.

.893 Tests null hypothesis of equal population covariance matrices of canonical discriminant functions.

Discriminant Analysis should not be performed, if the within groups are significantly different. It implies that we should accept the null hypothesis of equal population covariance matrices of canonical discriminant functions. The significance value of p above is 0.893, which means there is no significance. Hence we accept the null hypothesis that there is no significant difference between the within group variances, and hence shall proceed with the Discriminant model building and analysis. Classification Accuracy: The next important thing is the accuracy of the model in predicting the choices.
Classification Results (a) Predicted Group Membership Original Count CHOICE 1 2 3 % 1 2 1 18 1 0 100.0 9.1 2 0 10 0 .0 90.9 3 0 0 8 .0 .0 Total 18 11 8 100.0 100.0

3 .0 .0 100.0 100.0 a 97.3% of original grouped cases correctly classified. The prior probabilities were taken from the cases taken for analysis. There was no assumption of equal probability, since we found that there is a marked preference for marketing stream, followed by HR, and Finance in that order, as seen from the cases used in the analysis.

Prior Probabilitie s for Groups Cases Used in Analysis Unweighted Weighted 18 18.000 11 11.000 8 8.000 37 37.000

CHOICE 1 2 3 Total

Prior .486 .297 .216 1.000

Statistical Significance of the Discriminant Function: This is answered by the Wilks lambda value, and p value of the F-Test, calculated from a one way ANOVA, with the grouping variable serving as a categorical independent variable,
Wilks' Lambda Wilks' Lambda .135 .395

Test of Function(s) 1 through 2 2

Chi-square 53.141 24.615

df 32 15

Sig. .011 .055

The value of Wilks lambda varies between 0 to 1. A lower value, (< 0.5) and closer to 0, indicates better discriminating power of the model. In this case, the Wilks lambda values are 0.135, and 0.395, as seen in the above table. The p values are 0.011 and 0.055, which shows a high degree of significance at 1% and 5% level (ignoring the third digit). Analysis of Eigen Values: For each discriminant function, the eigenvalue is the ratio of between-group to within-group sum of squares. Larger eigenvalues imply superior functions. It is indicative of the % variance explained by each of the function.
Eigenvalues Canonical Eigenvalue % of Variance Cumulative % Correlation 1.934(a) 55.8 55.8 .812 1.532(a) 44.2 100.0 .778 a First 2 canonical discriminant functions were used in the analysis. Function 1 2

As we have 3 choices, there are two discriminant function, can be extracted. The superiority of the function is decided by the eigen value. However, the eigen values in the above are not very different, and hence either of the function is as good as the other for discriminant separation. Which are better predictors (variables)? This is inferred from the table of standardized coefficients for Canonical Variables. This table is reproduced below. The absolute value of the coefficient, ignoring the algebraic sign, is important in deciding the relative importance of the predictors.
Standardized Canonical Discriminant Function Coefficients Function 1 Q1 Q2 Q3 Q4 Q5 Q6 Q7 Q8 Q9 Q10 Q11 Q12 Q13 Q14 Q15 Q16 .435 -.647 -.982 -.842 .597 -.063 .351 1.348 .388 -.159 .440 -.076 .462 -.116 -.688 -.278 2 -.308 -.227 -.075 .251 .766 -.134 .161 .467 .351 .347 -.756 .988 .985 -.931 .190 -.472

For function 1, going by the absolute value (ignoring algebraic signs), the variables are, in the descending order of the values of standardized function coefficients: Q8, Q3, Q4, Q15, Q2, where the values are above 0.5. Variables Q1, Q9, and Q7 have values less than 0.5, but predict this function better than function 2. For function 2, the variables are: Q12, Q13, Q14, Q5, Q11, which have coefficients above 0.5. In addition, variables Q16, Q10 and Q6 have values less than 0.5, but predict this function better than function 1.

Classifying (discriminating) new cases: This is the ultimate objective of this analysis. i.e. the identification of the preferred choice of 1,2 or 3 (i.e. Marketing, HR or Finance) which will be chosen by the new entrants. SPSS provides the Classification Function Coefficients table which can be used for this. This table is reproduced below:
Classification Function Coefficients CHOICE 1 Q1 Q2 Q3 Q4 Q5 Q6 Q7 Q8 Q9 Q10 Q11 Q12 Q13 Q14 Q15 Q16 (Constant) .921 -1.858 3.738 2.363 7.882 -.989 1.318 10.138 2.862 2.787 -.254 .953 9.961 -6.691 .177 .732 2 2.256 -2.616 1.370 -.151 8.505 -.991 1.675 13.666 3.292 2.174 1.216 .097 9.960 -5.875 -1.176 .597 3 1.534 -1.351 4.367 2.014 5.386 -.578 1.009 7.802 1.982 2.108 1.154 -.760 7.074 -4.022 .017 2.090 -75.232

-92.264 -96.280 Fisher's linear discriminant functions

Fresh cases are classified on the basis of discriminant scores, calculated using the coefficients in the above table. I.e. for each new case, the discriminant score has to be calculated from equation-1 for each choice given in the earlier section, by multiplying the response value of each variable (question) by the corresponding classification function coefficient, given in the above table. The choice (of stream) is determined by that discriminant score, which is the maximum of the 3 values.

Examples: Three new cases are taken, one sample for each stream of choice, viz., Marketing, HR and Finance. Every case is to be evaluated for each of the three choices, using the coefficients of the classification function.

The choice is that stream which yields the maximum of the discriminant function value. Coefficients of Classification function.
Q1 Q2 Q3
3.74

Q4
2.36

Q5

Q6

Q7
1.32 1.68 1.01

Q8
10.1 13.7 7.8

Q9
2.86 3.29 1.98

Q10 Q11 Q12 Q13 Q14 Q15 Q16 Constant

2.79 -0.25 2.17 2.11 1.22 0.95 0.1 9.96 -6.69 0.18 0.73 -92.3 choice-1

0.92 -1.86 2.26 -2.62 1.53 -1.35

7.88 -0.99 8.51 -0.99 5.39 -0.58

coefficients
1.37 -0.15 4.37 2.01 9.96 -5.88 -1.18 7.07 -4.02 0.02 0.6 -96.3 choice 2

coefficients
1.15 -0.76 2.09 -75.2 choice-3

coefficients

Examples of new cases, for evaluation of Discriminant Score, and classification of stream of choice. Q1 7 5 Q2 5 3 Q3 3 7 Q4 7 6 Q5 6 5 Q6 3 6 Q7 1 3 Q8 4 6 Q9 6 2 Q10 Q11 Q12 Q13 Q14 7 7 6 5 4 2 6 6 4 6 Q15 Q16 5 6 2 7

1 3

case 1 case 2

5 2 5 4 5 4 4 6 2 2 4 6 6 6 5 5 2 case 3 Evaluation of Case 1, and choosing the choice with highest discriminant score, i.e. 1 6.45 -9.29 11.2 16.5 47.3 -2.97 1.32 40.6 17.2 19.5 -1.78 5.72 49.8 -26.8 0.89 4.39 87.8 Choice is 1 15.8 -13.1 4.11 -1.06 51 -2.97 1.68 54.7 19.8 15.2 8.51 0.58 49.8 -23.5 -5.88 3.58 81.9 10.7 -6.76 13.1 14.1 32.3 -1.73 1.01 31.2 11.9 14.8 8.08 -4.56 35.4 -16.1 0.09 12.5 80.8 Evaluation of Case 2, and choosing the choice with highest discriminant score, i.e. 3 4.61 -5.57 26.2 14.2 39.4 -5.93 3.95 60.8 5.72 5.57 -1.52 5.72 39.8 -40.1 0.35 5.12 66 11.3 -7.85 9.59 -0.91 42.5 -5.95 5.03 82 6.58 4.35 7.3 0.58 39.8 -35.3 -2.35 4.18 64.7 7.67 -4.05 30.6 12.1 26.9 -3.47 3.03 46.8 3.96 4.22 6.92 -4.56 28.3 -24.1 0.03 14.6 73.7 Choice is 3 Evaluation of Case 3, and choosing the choice with highest discriminant score, i.e. 2 4.61 -3.72 18.7 9.45 39.4 -3.96 5.27 60.8 5.72 5.57 -1.02 5.72 59.8 -40.1 0.89 3.66 78.5 11.3 -5.23 6.85 -0.6 42.5 -3.96 6.7 82 6.58 4.35 4.86 0.58 59.8 -35.3 -5.88 2.99 81.3 Choice is 2 7.67 -2.7 21.8 8.06 26.9 -2.31 4.04 46.8 3.96 4.22 4.62 -4.56 42.4 -24.1 0.09 10.5 72.2

Conclusion: We have successfully tested, based on the Discriminant analysis, the three cases, which are used for validation of the model. One student from each stream was chosen and asked to fill-up the questionnaire. Using their responses the discriminant coefficient was calculated for each of the student. In all the three cases the predictions have yielded correct results. Now this gives the management of a b-school a fair idea to pre-determine the possible streams that will run. At the end of first year (of a two year PGDM course) or at the beginning of the second year, the students can be asked to

fill up the questionnaire. They may also indicate their preference of stream. Putting the data through Discriminant analysis can give a fair estimate of the possible streams that would run. The managements will then be able to plan in advance for the faculty, resources etc., for the successful delivery of the courses. Acknowledgement: The author wishes to place on record the help and assistance rendered by Mr. Sumit Rustagi, a second year PGDM Student, KIAMS, Harihar, who assisted in the primary research: Design of questionnaire, data collection, entry and some preliminary analysis. References: 1. Marketing Research An Applied Orientation (3e), Naresh K. Malhotra, Prentice Hall International Inc., 2. Marketing Research Text & Cases (2e), Rajendra Nargundkar, Tata McGraw Hill Publishing Company Ltd., New Delhi. 3. SPSS Base 10 Applications Guide, SPSS Inc., Chicago IL, USA. 4. http://en.wikipedia.org/wiki/Consumerism, accessed 30th Oct 2006. 5. http://euromed.blogs.com/baets/2006/08/consumerism_in_.html, accessed 30th Oct 2006. 6. Issues in Teaching Management in B-Schools, S. Sudarshan, University News, Oct. 20 -26, 2003, pp 23-24

Annexure A Questions posed to the students. Each question to be rated on a 1 7 scale. 1, being the lowest and seven the highest.
1. Current Trend(s) in the industry. 2. Graduation Degree / Educational Background e.g. B.Tech, BA, B.Com. 3. Personal Interest. 4. Pay and Incentives offered in the Industry. 5. Probability of Promotions. 6. Working Conditions in the industry. 7. Gender Background 8. Ability to project my individual excellence and skills 9. Influenced by others - friends, industry persons, etc., 10. Influenced by seniors / peer students. 11. Autonomy i.e. gives you greater authoriy at the work place. 12. My future plans to be an entrepreneur. 13. Responsibilities that can be assigned during Job. 14. Work offered would be Challenging. 15. Will give you Travel Opportunities. 16. Gives you opportunity to Learn New skills. 17. Any other factor which has influenced you ,pls write __________________________