Case-Based Questions: Emerging Modes of Business

Carefully read the following case studies, which present real-world business scenarios, and answer the question(s) that follow each case to test your understanding and application of business studies concepts.
Case 1: Mr. Mehra's Online Transactions
Mr. Mehra, General Manager at AU Small Finance in Rajasthan, was transferred to Hyderabad. He sold his old sofa and bed through OLX. In Hyderabad, he ordered a new sofa and bed from Godrej Furniture online, tailored to his room's space. Upon delivery, he noticed a color defect in the sofa and filed an online complaint with Godrej's customer care. The head of the customer grievances cell forwarded the complaint to the Marketing and Production managers for action. An inquiry revealed that M/s Touchwood Furniture Dealers, a distributor of Godrej Furniture in Hyderabad, caused the 'default on delivery' while processing the online order for delivery to customers.

Q1: 'So he sold his old sofa, and bed through OLX.' Identify the type of e-business model involved in the transaction mentioned here.
(a) Business to Customer
(b) Business to Business
(c) Customer to Customer
(d) Customer to Business

Ans: (c)
Explanation: This transaction is a Customer to Customer (C2C) e-business model because an individual (Mr. Mehra) sold used household items directly to another individual using an online marketplace (OLX). C2C platforms act as facilitators by providing the online space, listing tools and often payment or messaging features, but the actual buyer and seller are both customers rather than companies. It is not B2C (a business selling to a customer), B2B (business to business) or C2B (customer selling to a business).

Q2: 'M/s Touchwood Furniture Dealers, distributor of Godrej Furniture in Hyderabad made the 'default on delivery' while taking online order from Godrej Furniture for making delivery to its online customers." Identify the limitation of e-business stated here.
(a) Lack of personal touch
(b) Time-consuming
(c) Risk arising due to anonymity and no traceability of parties
(d) Fraudulent trading

Ans: (c)
Explanation: The problem described points to a risk from anonymity and lack of traceability. In e-business, intermediaries or third-party distributors may handle orders and deliveries, which can create gaps in accountability. When a distributor makes an error, it may be harder to trace responsibility quickly compared with face-to-face transactions, and this increases the risk of faults or disputes. This is different from lack of personal touch or being time-consuming; the emphasised issue here is accountability and traceability.

Q3: '...he found colour defect in the sofa so he filed an online complaint with customer care cell of Godrej Furniture.' Identify the type of e-business model involved in the transaction mentioned here.
(a) Business to Customer
(b) Business to Business
(c) Customer to Customer
(d) Customer to Business

Ans: (d)
Explanation: Filing a complaint to Godrej Furniture is an example of Customer to Business (C2B), because here an individual customer is communicating with and providing feedback to a business organisation. The customer initiates action (the complaint) directed at the company for resolution. This differs from B2C, where a business approaches a customer; in C2B the customer is the active party contacting the business.

Q4: 'The head of customer grievances cell forwarded this complaint mail to the Marketing manager and Production manager for further action.' Identify the scope of e-business mentioned in this case.
(a) Customer to Customer
(b) Business to Business
(c) Intra B
(d) Customer to Business

Ans: (c)
Explanation: This example illustrates Intra B, meaning internal business communication or transactions within the same organisation. The complaint moved between departments (customer grievances → marketing → production) as part of Godrej's internal processes to resolve the issue. It is not an external B2B interaction or a customer-to-customer exchange.

Case 2: Utsav Sharma's Laptop Bag Business
Utsav Sharma, an entrepreneur, plans to start a business manufacturing laptop bags with an inbuilt lock and solar charger. Due to the complex and tedious manufacturing process, he decides to produce the bags entirely at his factory but outsources the advertisement campaign to Vigyapan Agency to focus on core functions.

Q5: Identify the mode of business followed by Utsav to focus on key functions of business.
(a) Outsourcing
(b) e-business
(c) Agency
(d) Joint venture

Ans: (a)
Explanation: Utsav is practising outsourcing by hiring Vigyapan Agency to handle advertising. Outsourcing lets a firm delegate non-core activities (like promotion) to specialised external providers so the firm can concentrate on its core competency (manufacturing the complex laptop bags). This helps improve efficiency and may reduce cost and managerial burden.

Q6: Outsourcing of advertising services will come under the scope of _______________.
(a) BPO
(b) KPO
(c) Both BPO and KPO
(d) Horizontal service provider

Ans: (a)
Explanation: Outsourcing advertising is classified as Business Process Outsourcing (BPO) because it involves contracting out a routine business process-promotion and advertising-rather than handing over specialised knowledge work. The agency performs the process on behalf of Utsav so he can focus on production. (In some cases, marketing work may include specialised tasks, but at this level it is treated as a BPO activity.)

Q7: Vigyapan Agency is a:
(a) Captive service provider
(b) Vertical service provider
(c) Horizontal service provider
(d) All of the above

Ans: (c)
Explanation: Vigyapan Agency is a horizontal service provider because it offers advertising services to many different firms across industries, rather than serving only one parent company (which would be a captive provider) or specialising exclusively in one industry (vertical provider). Horizontal providers supply common services that many businesses require.

Q8: Which one of the following is not the need of outsourcing?
(a) Focusing of attention
(b) Quest for excellence
(c) Cost reduction
(d) Sharing of trade secrets

Ans: (d)
Explanation: Sharing of trade secrets is not a reason to outsource. Outsourcing is done to let firms focus on core activities, achieve better quality through specialists (quest for excellence) and reduce costs. In fact, firms aim to protect their trade secrets when outsourcing by using contracts and confidentiality agreements rather than sharing them indiscriminately.