Category: Commerce Notes PPT

LIC stands for Life Insurance Corporation of India. It started its operations as a corporate firm in September 1956 after the Life Insurance of India Act was passed by India’s Parliament in June 1956. The LIC Act came into effect from July 1956. It helped in the nationalization of the private insurance industry in India. LIC of India was formed by merging 154 life insurance companies, 16 foreign companies and 75 provident companies. It is one of the largest financial institutions in India. It has an asset value of over 2,529,390 crores. The headquarters of LIC is in Mumbai, Maharashtra.

 

The main slogan of LIC is- “Yogakshemam Vahamyaham” meaning “Your welfare is our responsibility”. It is in Sanskrit and is obtained from the 22nd verse of the Bhagavad Gita’s 9th chapter. The chairman of Life Insurance of India is Mr M.R Kumar.

Role of LIC in Indian Economy

LIC is known as India’s largest government-owned life insurance and investment corporation. The main role of LIC is to invest in global financial markets and different government securities after gathering funds from people through their various life insurance policies. At least 75% of these gathered funds are to be invested in Central and State Government securities, as stated by one of the LIC rules.

Functions of LIC

The major functions of LIC are as follows:-

• Collect people’s savings in exchange for an insurance policy and promote savings in the country.

• Protect the capital of the people by investing funds into government securities.

• Issue insurance policies at affordable rates

• Provide various loans like direct loans to industries, housing loans, loans to various national projects at reasonable interest rates.

Objectives of LIC

• LIC aims to spread awareness about the importance of life insurance among people living in rural areas and people who are a part of socially and economically backward classes.

• It aims to meet several life insurance needs of the community people who are subjected to change with the changing social and economic environment.

• It aims to conduct business economically while taking into consideration that the money belongs to the policyholders. 

• It aims to maximize the mobility of people’s savings through attractive insurance-linked savings. 

• It aims in providing utmost job satisfaction to all the agents and employees of the corporation and promotes building a co-operative work environment to deliver efficient service with courtesy to its insured public.

• It aims to deploy the funds to the best advantage of the investors and the community as well.

Types of LIC Life Insurance Plans

LIC provides numerous schemes to its policyholders. It offers different schemes for different categories and segments of the Indian economy. It is the largest insurance policy company in terms of the number of policies it has issued to date. Some of the policies are as follows:-

What are the Basic Policies of the Life Insurance Corporation of India?

The basic policies in Life Insurance Corporation of India (LIC) are term insurance, cash value insurance, straight life insurance, and limited payment life insurance. The details of each of these policies are given below:

• Term insurance: This insurance is like an insurance protection contract, similar to auto insurance, home insurance, or health insurance. Therefore, it ensures the individual against any risk of financial loss in case of death and does not include any savings plan. In this insurance policy, the owner buys a fixed amount of coverage and pays an annual premium based on their age. The policy is for a fixed period of time and thus the coverage stops if it is not renewed. These policies are available for five years, ten years or fifteen years where the amount of premium to be paid remains constant. The life insurance can also be purchased with a condition of 65 years of age, that is, the insured does not become 65 years of age and in this case, the amount of premium to be paid increases annually. There is decreasing term life insurance also available wherein the coverage of the insurance decreases with time so that the annual premium to be paid remains constant. Term insurances provide maximum coverage to the premium spent.

• Cash value insurance: In this kind of policy, the amount of actual insurance decreases over time and the savings component of the policy increases over time. This type of insurance is funded by the premium payments done by the insured along with the earnings of the saving element in the policy. These insurance policies are of two types: straight life policy and a limited payment policy that provides coverage to the insured throughout life.

1. Straight life insurance: the insurance is throughout life. In this type of insurance, the amount of protection decreases as the savings amount increases, though the total coverage of the policy that includes the protection and savings elements remains the same. The premium in these policies is higher than the term insurance which is based on the age of the individual when he or she buys insurance. The premium for this policy remains constant. The face value of insurance refers to the amount which is paid when the insured person dies. 

2. Limited payment life insurance: in this type of policy the insured person pays the total amount of policy in a limited number of years, that is, usually 20 to 30 years or by the age of 65. After the completion of the term, the policy remains active for the whole life of the insured if he or she has not withdrawn the amount at any point in time. The amount of premium to be paid every year in this policy is obviously higher than the straight life policy. 

Did You Know?

The first company in India that provided insurance coverage was The Oriental Life Insurance Company, established in 1818, in Kolkata. Surendranath Tagore founded the Hindustan Insurance Society which later became Life Insurance Company.

Solved Examples

1. LIC was Established in Which Year?

1. June 1956

2. September 1956

3. July 1956

4. October 1956

Ans: (b) September 1956  

2. Where is LIC Headquartered in?

1. Kolkata 

2. Pune

3. Mumbai

4. Chennai 

Ans: (c) Mumbai

 

There are primarily two major branches of economics – microeconomics and macroeconomics. The former deals with the performance and behaviour of individuals or organisations. The latter one, on the other hand, accesses the economy as a whole and includes a country’s vital economics factors such as inflation, growth rate, GDP, etc. 

Basic Concepts of Macroeconomics

Macroeconomics in itself studies decision-making, structure, performance, etc. of a nation. Further, it accesses other quintessential aspects of microeconomics and aggregate indicators that influence a country’s economy. It works through macroeconomic models which Government and corporations use to formulate economic strategies and policies. 

1. Inflation and Deflation – A significant factor of macroeconomics is the assessment of inflation and deflation. Inflation denotes the rise in prices of goods and services, and deflation means a decrease in the price of those.

Economists evaluate inflation and deflation with the help of price indexes. Studying these two aspects, the Government can take measures to curb them; as high inflation rate leads to several consequences while deflation causes low economic output.

2. Unemployment – Another crucial economic indicator is the unemployment rate. It refers to the percentage of people without a job. Higher rate of unemployment of a country means a lesser economic output. Economists have divided it into four classic segments- classical, structural, frictional and cyclical employment.

Classical unemployment occurs when real wages are kept too high to hire workforce by employers. Frictional unemployment means when people change jobs voluntarily, it takes time to find another job after an individual leaves, that period is termed as unemployed. Structural unemployment comes from the mismatch between an employee’s working skills and skill necessary for a particular job.

Finally, cyclical unemployment is variable numbers of unemployed workers over a specific period; like it rises during recession and declines during economic growth. The overall performance of a country depends on how it uses its resources, and skilful employees have to be one of them.

3. Income and Outputs – One of the most important macroeconomics concepts includes income and output. The national output is calculated by a total number of goods and services produced in a country over a specific period.

When organisations or production units sale off all products, they gain an equal income from those. Economists usually measure these two factors with the help of Gross Domestic Product or GDP.

With capital increase, technological advances and other aspects, Government or organisations can increase income and national output. However, these two components often get affected by several market factors such as recession. 

Also Read: Difference Between Micro and Macro Economics

Macroeconomics Policies

Now and then the Government introduces several new policies to bring equilibrium in an economy. Two of these policies are monetary policies and fiscal policies.

Monetary Policies – It is an essential factor which is implemented by a central monetary authority like the Reserve Bank of India. The main objective of this change is to stabilise GDP and narrow down the rate of unemployment.

Along with that, it regulates money supply in an economy. For instance, RBI can infuse money in the market by issuing funds to purchase bonds and several other assets. Similarly, RBI can sell those assets to stop the circulation of money.

A few instruments of monetary policies are CRR, SLR, Open Market Operations, Repo and Reverse Repo Rate, Bank rate policy and various others. However, the primary goal of this is to stabilise the economic condition of the country.

Fiscal Policies – It is a tool which makes use of Government’s expenditure and revenue generation to control economic stability during a financial year. For example, if production in an economy cannot match up to required output, Government may spend on a few resources to reach up to estimated output. However, monetary policies are preferred over fiscal policies by economists as the former ones are controlled by RBI, which is an independent body. In contrast, fiscal policies are regulated by the Government which can be altered by political intentions.

These are some basic concepts of macroeconomics which commerce students need to master to comprehend how a country’s economy works at a large scale. 

Circulation in Macroeconomics

The flowchart mentioned below elucidates the process in which the economy of a country runs under macroeconomics. (image to be uploaded soon)

You can also make a table to find the difference between inflation and deflation for further reference. 

MCQs on Macroeconomics

1. Macroeconomics is a Discipline of Economics Which Deals with 4 Major Components.

1. Household, government, firm, demand-supply.

2. Household, firms, Government, and external sector.

3. Firms, free-market, Government, regulations.

4. None of the above.

Ans: (b)

2. Intermediate Goods are Not Included in Calculating the Final Output Because

1. They do not have value

2. They have an unknown value

3. Their value is included in final value to avoid double counting

4. None of the above.

Ans: c

3. In a Nation’s Economy, What Does Gross Investment Mean?

1. Net investment + Depreciation

2. Net investment- Depreciation

3. Depreciation- Net investment

4. None of the above

Ans: (a)

Macroeconomics is essential to understand the economic situation of a country. Hence, students should read more on this topic and economics basic concepts notes, in general, to get a firm grasp on economics as a subject. For more such useful lessons on other commerce subjects’ stay tuned to ’s website. You can also install ’s app in your smartphone to access the study materials anytime.

Marketing is the process of acquiring the right goods or services or even the ideas to the right people at the right place, right time, and price, also using the right promotion techniques to provide the customer services that are associated with the goods, services, or the ideas. 

The concept which is referred to as the “right” principle is the main basis of all the marketing strategies that are used by a business. Marketing is about creating exchanges that would bring a positive change in the livelihood of the people. This exchange takes place between two parties that give something of value to each other to satisfy their own needs or wants. 

Societal Marketing Concept 

Societal marketing is the concept that holds the notion that a company should make good marketing decisions prior to considering the consumers’ wants, the company’s requirements, and society’s long-term interests at large.

Philip Kotler, the father of marketing defines Societal Marketing as “the societal marketing concept holds that the organization’s task is to determine the needs, wants, and interests of target markets and to deliver the desired satisfactions more effectively and efficiently than competitors in a way that preserves or enhances the consumer’s and the society’s well-being.”

Societal Marketing builds a favorable image for the company which increases sales. This is a term that is closely related to CSR and sustainable development in that regard.

Societal Marketing emphasizes social responsibilities and suggests a business to sustain with this principle.

Selling Concept 

The selling concept refers to a process in which a business justifies that the consumers will not be willing to purchase enough of a business’s product or services without a persuading promotional campaign. This concept is used mostly in the industries which create goods that the consumers usually don’t consider buying. These companies generally have large sales forces and focus their energies and strategies on selling their products.

Holistic Marketing Concept 

Holistic Marketing Concept is the part of a series on the concepts of marketing which defines the marketing strategy that is considered the business as a whole and not as an entity with various different parts. 

According to this holistic marketing concept, if a business is made of various departments, then the departments are required to come together to represent a united business image in the minds of the customers. The holistic marketing concept is interconnected with marketing activities that ensure the customer is likely to purchase their product rather than falling into the competition.

Marketing Philosophies 

1. Production Concept

This concept is ruled on the efficient production process of a company. As in the days of the industrial revolution, this is believed that goods that are available in excessive quantities and at cheap prices will always sell no matter what.

2. Product Concept

In the product concept, the company will make sure that their goods are of the standard quality. This means the cost of production and the price of the product will be higher. In this case, the company will look to maximize its profit with promising quality products.

3. Selling Concept

This concept has a shift. A shift from the production of the product to only selling the product. Even after the goods satisfies the price and quality requirements of the consumer, the sale is not guaranteed. Thus, in the selling concept of marketing management philosophies, the strategy is to persuade the consumer to buy the product by whatever means necessary.

4. Marketing Concept

Marketing is added as one of the newer marketing management philosophies. It is a very recent concept which truly believes “the customer is king”. All the decisions are directly or indirectly influenced by the needs of the customer. Right from the production to designing of the goods till its transportation, each process has customer satisfaction in mind.

5. Societal Marketing Process

At times the need of the customer and the requirement of the company are not best suited to society or the environment. Since the business is a part of society, a businessman must ensure society’s well being as well. So, this concept will focus on the satisfaction of consumer needs undoubtedly also without harming the society or the environment in the process of satisfying.

Production Concept in Marketing 

Production is a Concept which is moreover a belief which states that the customers would always acquire the products which are cheaper and more readily or easily. The production concept basically means that the more the products or production more will be the sales. In countries where the labor is cheap and is easily available, like in our nation, the production can be maximized while minimizing the costs, thereby increasing the production efficiency.

Social Entrepreneurs are individuals who are willing to create positive changes in society through their innovative ideas and efforts. They run their business or organization to achieve their goals by helping society. Their motto to start a business venture is primarily to help society and have no great intention of making personal profits. Their success is not always measured in terms of profit alone. A small change in the society out of their efforts is a success too. Social entrepreneurship is also referred to as altruistic entrepreneurship –which translates to selfless concern for the well-being of others.

There are many environmental and social problems out there and social entrepreneurs identify those problems and come up with innovative ways, and establish or adopt a business model around it. By presenting user-friendly and adaptable ideas to the local people, social entrepreneurs are generally looked up to as leaders or role models for driving philanthropic projects and bringing a large group of people to believe in their initiative. In the recent past, there have been many social entrepreneurs or philanthropists who have made immense success and proven to the public that not all needs of society are to be solved by the Government. Any person with a vision and the ability to bring change can do it.

Below are a Few Examples of Leading Social Entrepreneurs

• Vinoba Bhave (India)  was the leader and founder of the Land Gift Movement. He led to the redistribution of around 7,000,000 acres of land that later on helped the landless and untouchables of India.

• Dr. Maria Montessori (Italy) – The Montessori approach to early childhood education was developed by her.

• Elon Musk, Tesla Motors, SolarCity, and SpaceX caused Musk to become an explorer of social entrepreneurship in the modern era, as he pursued to create solutions that are accessible to renewable energy and push the bounds on space exploration for the human race.

Social entrepreneurship has similarities and distinctions when compared to the standard definition of entrepreneurship

Importance of Social Entrepreneurs

Social Impact and Inspiration: the origination of a social enterprise is an existing gap or problem that an individual identifies and has a solution for. Social entrepreneurs’ works tackle the existing problem of society, they do not intend to create legacies and are an inspiration to society.

Make the World a Better Place: Social entrepreneurs are obsessed and extremely passionate about the initiative and work towards the goal against all odds, and can go to any extent to see that society is problem-free. It is the social entrepreneurs who can bring drastic changes to culture, business, and economy while they make a living out of it.

Generation of Social Capital: One of the most important values and powerful influences created by Social entrepreneurs is the equation established by social groups through interpersonal relationships, a shared sense of identity, and a shared understanding in their network that helps people to ‘get by, accept and get ahead’ with changes.

Factors the Strengthen Social Entrepreneurship

How the Project Contributes to the Economy: Having known social entrepreneurship is for the society or environment, it also means there is or has been a demand for the product or service. Most entrepreneurial initiatives contribute to the economy, by creating job opportunities and wealth. The social enterprise thus established must aim at generating enough wealth that can contribute to society. 

Responsibility Towards Society and Environment: The primary intention of social enterprise is to identify gaps in the environment and society that are not working efficiently and create a social value out of those. Aimed at bringing in a change and something new to solve a certain problem, these objectives can vary from industries, health services, education, energy-saving, etc. A lot of corporate entities form a small trust to implement these objects in the form of Customer Social Responsibility (CSR)  projects. 

Effective Profit Utilization: As discussed, earlier social entrepreneurs are not aimed at making personal profits, their profits are often re-invested in the business to achieve the goal, personal profits are hence supervised and are limited. However, depending upon the status of the project, the entrepreneur can decide how much is to be reinvested to achieve the goal.

Efficiently Managed: Unlike the standard entrepreneurship framework, social entrepreneurship can involve a group of people working together with the same intention of bringing a change to society. Hence, the decision-making, execution of tasks, etc. are all shared and are done with the active participation of all experts at different levels. Here, making use of participation efficiently is the key.

Conclusion

Entrepreneurship has been the booming and most pursued carrier option in recent times. Many top college graduates have set up their own companies and thrived excellently in their respective domains. Entrepreneurs lookup for a gap in the demand and supply chain in the market and using their agencies of creativity, innovation, and resourcefulness they find a solution in the form of a product or service that will fill in the gap. 

Thus, they bring in the market something that is in great demand already. This way they are able to generate a good amount of sales and hence earn a good profit as well. Entrepreneurship is mostly pursued as a career option because it gives the liberty of being your own boss and also to exercise your creativity and innovativeness with no restrictions. Once launched well and settled up, it brings up a lot of opportunities for expansion and collaboration. The profit one generates is also better than what one may have got while doing a job. 

More about Social Entrepreneurship

Social entrepreneurship is the one branch of this tree that is not much concerned with the money or royalties that they may avail after being an entrepreneur. Social entrepreneurs are more concerned with the betterment of society and work in the direction accordingly, though they also look for profit margins, it is very marginal and their main aim is the enhancement of socio-economic conditions. They may or may not already have a good amount of wealth. If they don’t, they mainly try to launch that company or industry which will lead to the development of jobs, create a money flow in the local economy and utilize the skills of the local artisans. This way they ensure that the local skill potential is utilized and also that profit is generated. On the other hand, if they have a good amount of wealth they will try to manage the resources properly and develop employment opportunities for the local population without caring much about their own profit. 

Social entrepreneurship has become a very critical driving force in the national and local economies of the country. This type of entrepreneurship has been incorporated into the policies of govt as well and govt has subsidized many such establishments which pursue the development of the local economy. 

Social entrepreneurship has been also admired by the local populations as well because these ventures create a great positive impact regarding enhancing the lives of local people in terms of monetary security and job creation.

Mercantile Law is a repository of all the Laws included in a company to handle or look after its commercial activities. It is a generalized term for the entire legal body. All the other acts like the company act, limitations act, Indian contract act, etc. are subsidiaries of the Mercantile Law. And the acts are known as Mercantile Law acts.

It deals with all the commercial transactions of the trader, whether it is an individual or an organization or maybe a joint venture. The commercial transactions include the agreements between both parties, operational activities, the delegation of work, financial transactions, memorandum of associations, etc. So let us understand the meaning of Mercantile Law and its sources, scope.

Mercantile law is a combination of various laws and principles of individuals having legal knowledge to resolve various issues in the company. But in 1872, all these laws are joined and termed as mercantile law and from then to regulate various issues of your company several acts are formed respectively such as the Indian contract act, the company act, the limitations act, etc. from the definition of mercantile law it is clear that it has a very wide scope.

Mercantile Law, also known as Commercial Law, governs the commercial activities of the economy. It is a broad term that encompasses all of the Laws in India that govern commercial transactions. Such a transaction necessitates a valid agreement between the contract’s parties. It can be explicitly stated or implicitly stated.

It is concerned with traders’ rights and obligations arising from commercial transactions. The trader can be an individual, a partnership, or a corporation. The Mercantile Law of India encompasses all Indian Acts that govern trade or commerce. For example, the Indian Contract Act of 1872, the Sale of Goods Act of 1930, the Companies Act of 2013, and so on.

 

Principal Sources of Mercantile Law

1. Law Merchant: The main source of Mercantile Law is the Law merchant. It refers to the customs and rules that govern traders’ and businessmen’s dealings and transactions with one another.

2. Statute Law: Legislation creates Law, which is referred to as statute Law. A statute is a written formal act of the legislature. It has also evolved into a significant source of Mercantile Law.

3. The Principle of Equity: The principle of equity refers to a set of rules that are not based on customs or statutory Law. As a result, equity rules were formed based on the basis of conscience dictates decided in chancery courts.

4. Common Law: Common Law is a set of rules defined by customs, judicial decisions, and old scholarly works on the subject. It is an unwritten English Law that applies to everyone in the country. In this context, common law refers to legal principles developed by judges through case decisions.

 

Principal Sources of Mercantile Law

The Indian Mercantile Law has various sources similar to that of English Mercantile Law. Some of the principal sources of Mercantile Law are-

1. English Mercantile Law

English Mercantile Law is an unwritten, generalized Law of England to deal with customs and judicial activities which has equity Law, merchant Law, common law, and statute Law as its sources.

As India was under the control of the British for a longer time, the Indian Mercantile Law is derived from the English Mercantile Law meaning. All the concepts, formats can be taken from it English Law. Even in recent times also if any issues are unsolved, our judicial heads will take help from the English Mercantile Law. 

2. Enacted Acts by Indian Legislature

Some of the acts involved in the Mercantile Law are enacted by the Indian legislature. These acts are listed below-

• The Carriers Act(1865)

• Indian Contract Act(1872), 

• Negotiable Instruments Act(1881)

• The Presidency Town Insolvency Acts(1909) and 

• Provincial Insolvency Act (1920)

• Sale of Goods Act(1930),

•  Indian Partnership Act(1932)

•  The Insurance Act(1938)

• The Arbitration and Conciliation Act(1996)

3. Judicial Decisions 

Judicial decision refers to the decisions made by individuals having judicial powers. It means that judges available in the courts will form certain rules and ask their subordinates to follow. And it is fixed and constant for all the cases. The Indian government has given authority in such a way that if the high court makes a judgment, it should be obeyed to all its subsidiary courts whether they are favorable or against.

Similarly, if the judgment has been given by the Supreme Court, it should be followed by all the courts of India except itself because it is the highest state of the Indian judicial body. The judgment will be common and will be in a written format which sets as a prerequisite for various cases in the future. The limitation is as the case may vary from one to another, the organization may vary from one to another; the judgment will be constant.

4. Customs and Trade Usage

It is a significant source of Mercantile Law. The Indian legal bodies give high priority to customs and trade. The codified Law also supports it. It provided all the powers required for the customs department, and section 1 of the Indian contract act is the best example to understand the importance of customs and trade usage as a major source of Mercantile Law.

“Nothing herein contained shall affect any usage or ……….inconsistent with the Act.” it is completely bound by the customs, and it is not against the public policy. So the legal body considered it and registered it as a legal obligation.

Similarly, we can understand all the principal sources of Mercantile Law only with the Mercantile Law examples.

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Hence, by observing the meaning of Mercantile, we came to know easily that the scope of Mercantile is very wide, and each source of Mercantile Law plays a predominant role. As it deals with all commercial activities of your company or an individual, it is good to have sound knowledge of all other acts which are included in the Mercantile Law.

Modern management and decision-making are integral to each other in nature. Managers in today’s age and time are always pressed for time hence it is imperative for them to use their time wisely in deciding whether a decision making process can be structured with a routine applied to it (programmed decision) or decisions that require thought and focus as they are novel (nonprogrammed decisions). Every manager is constantly taking such decisions all through their working hours, either consciously or subconsciously. 

This article will go through definitions of programmed and nonprogrammed decision making process along with examples of programmed and unprogrammed decisions. You will also be able to find out the difference between programmed and non programmed decisions.

 

Programmed and Non-Programmed Decisions

In management, there are mainly two types of decision making programmed and nonprogrammed.

Programmed decisions can be taken when something is repeated over time, and a set of rules can be devised to guide the process of such decisions. Programmed decisions can be simple or fairly complex, but the main thing about such decisions is that the criteria for making such decisions are either completely known or can be estimated with a fair degree of accuracy. Few examples of programmed decision are listed below:

• The decision to buy raw materials for producing goods is based on the amount to be produced, items in stock, time of delivery, etc. 

• The weekly work schedule of part-time workers in a retail store can be worked out based on how busy the store is in that time period, how many regular employees are available or applied for vacations, etc. Though establishing a schedule is a complex decision, yet it falls under programmed decision since a structure can be applied to the process.

The main technique that managers use for making programmed decisions is developing a mental shortcut or heuristics to help them reach a decision. 

On the contrary, a non programmed decision making process lacks structure and routine. This is the primary difference between programmed decision and non programmed decision. A nonprogrammed decision definition is a decision that does not follow a set procedure, and the criteria for such decisions is not well-defined. The main characteristics of an unprogrammed decision are:

• Information on which decision is based is generally incomplete or ambiguous.

• The decision-maker needs to use his/her creative thinking and judgment while dealing with a non programmed decision making process.

• Non-programmed decision making is also referred to as high-involvement decisions or nonroutine decisions since they need a high level of involvement on the part of the decision-maker.

The table below depicts the key differences between a Programmed and a non-programmed decision:

Difference Between Programmed Decision and Non Programmed Decision

Example of Non Programmed Decision In Business

In business, non programmed decisions are taken mostly by high-level management where crucial decisions are taken that involve a lot of unknowns. Few examples of an unprogrammed decision are:

• Whether a company must acquire another organization or not.

• Whether a new technology must be adopted or not.

• In which global market, the business has the highest potential.

Modern Techniques for Non Programmed Decisions

One needs subjective judgment for badly-defined problems that are non-recurring, novel, and unstructured. Though a standard procedure can not be applied when it comes to non programmed decision making, there are a few techniques that managers take for making non programmed decisions as described below:

• Brainstorming Technique 

Alex Faickney Osborn (also called the “father of brainstorm”) developed this technique of non-programmed decisions. He was an advertising executive in the United States. This method aims to improve problem-solving by devising new and creative solutions. A typical brainstorming session has 5 to 10 people in a group where the leader of the group presents the team with the problem in hand. Members are supposed to come out with all possible ideas, and each idea is then discussed and analyzed. The best idea, as per the consensus, is then selected after the session is over.

In a Delphi technique, a similar process as brainstorming is performed except for the fact that the members of the group do not meet each other face to face. Group members could be spread across the city, state, or even belong to different countries. Group members use modern tools like video conferencing to interact with each other. People can even use a questionnaire, which is a list of questions about the problem, to gather information from the members of the group. Delphi technique is a very effective method for non programmed decision making since in this, members do not see each other hence they are not affected or influenced by views and opinions of each other about the problem. This technique is also quick since the group uses modern tools and technologies to interact with each other.

• Nominal Group Technique 

In this technique, each group member thinks and comes up with ideas and solutions in isolation. There is no interaction between the group members in the initial stages of the decision making process. Group members start interacting once all of them have come up with an idea.

This was started in the 1960s in Japan where a small group of employees from the same department would voluntarily meet regularly to identify, analyze, and solve various types of problems related to their work.

This technique applies various aspects like the rule of thumb, experience, common sense, etc. An example of such an approach is enabling payments in installments for a product as the company feels that people would be more inclined to buy the product if they do not have to pay a lump sum amount but can break it into installments.