Mandatory Marriage Counseling

America is continuously plagued by divorce at an alarming rate destroying the basic structure of our society, which is the family. The trend is ever increasing and a growing problem in American culture. Divorce rate kept rising since 1920s with 13.4 per 100 marriages to 32.8 per 100 marriages in 1988. Today, studies have shown that 50% of first marriages in the United States fail. In 1940, the National Center for Health Statistics recorded 264,000 divorces and annulments and reached 1,182,000 in 1990.On the other hand, the National Survey of Families and Household cited that 84 percent of separated women would seek divorce after three years of marriage and 91 percent after five years of marriage. Some studies find the divorce rate for second marriages is as much as 10 percent higher than for first-timers. The chance of getting divorced remains so high that it makes sense for all married couples – including those who are currently satisfied with their relationship – to p ut extra effort into their marriages to keep them strong. (Gottman & Silver 4).The effects of divorce are most severe among women and especially to children who may develop psychological problems leading to juvenile delinquency. Economically dependent to their husbands and fathers, these women and children are forced to live on welfare and practically left homeless.Realizing this serious problem, state governments are now initiating measures to save marriages from deteriorating and protect families from breaking apart by enacting laws of mandatory marriage counseling prior to getting a marriage license in hope of preventing more divorces. I favor such law that would educate couples about the seriousness of marriage and the necessity to lifelong commitment. Critics oppose this early intervention because it is just a waste of time and money or that counseling does not work.More often in marriage expectations are in contrast with realities resulting to various conflicts. It is extremel y important therefore that would be married couples completely comprehend what they are up against, know the challenges that they may encounter, and learn how to deal with uncertainties. When Louisiana passed the law in 1997, Steven L. Nock conducted a five-year empirical study about the consequences of premarital counseling. In the report entitled Can Louisiana’s Covenant Marriage Law Solve America’s Divorce Problem?, 81% of the 521 married couples believed that mandatory counseling was very important.Their overall marital quality was better compared to those who did not take premarital counseling. In addition, their levels of commitment and agreement were higher. They experienced fewer worries and have greater sharing of household chores.The Evil of Divorce. To clearly discuss the merits of mandatory marriage counseling, I feel the urge to talk about the evils of divorce so that one can truly appreciate the benefits of counseling in the preservation of marriage. Each year, some 1.2 million children become products of divorced parents. Their normal childhood experiences are disrupted and filled with all sorts of stress. Many of them carry physical and emotional pain throughout their adulthood and may commit the same mistakes as their parents did. It is a chain reaction that affects family and our society.Children raised in single-parent families are more likely to drop out of high school, have lower grades and attendance while in school, and are less likely to attend and graduate from college than children raised in two-parent families. They are more likely to be out of school and unemployed and are also more likely to become single parents themselves, than children raised in two-parent families. Studies have found that, compared to children in two-parent families, children of divorce score lower on measures of self-concept, social competence, conduct, psychological adjustment and long-term health. (Bramlett & Mosher 4).Furthermore, they commit crimes, exhibit suicidal tendency, hook in illegal drugs, and become victims of abuse. They have turned into unproductive members of American society. The government spends almost $150 billion annually trying to subsidize single-parent families. However, only $150 million a year is devoted to programs that strengthen marriages. Most marriages end in divorce because of poor communications, financial problems, lack of commitment, infidelity, failed expectations, and physical, emotional or sexual abuse.As an institution, the government has the obligation to protect and restore the integrity of marriage. Thus mandatory marriage counseling is one of the best ways to teach couples the importance and true meaning of lifelong commitment. To rebuild the traditions of family life, the government in all levels must have the will to act to safeguard the sanctity of marriage.The Benefits of Marriage Counseling. The principal aim of marital counseling is to help couples stay together. Marital edu cation â€Å"immunizes couples against disappointment and despair†¦it also prevents the development of problems that are costly to children and all of society. Mismanaged conflict†¦ predicts both marital distress and negative effects on children's physical and mental health†. (Leslie par. 21). Preparation before marriage is critical to the success of family life. Mandatory counseling will help couples strengthen their relationship, love, intimacy, and commitment. It will enhance their communication skills and manage conflicts with the right attitude.This process will also evaluate the views and determination of the couples whether they are ready and compatible for marriage at the same time identify possible setbacks and weaknesses to better equip themselves in overcoming future challenges. Having a better view of marriage with its legal and natural obligations, couples will have a better chance to live a healthier marriage.Through counseling, couples will have infor med decisions to enrich their married life. A well-planned marriage is the key to combat divorce. More often people get married only to discover the true character of their partner and it is already too late to retreat. With mandatory counseling, couples will have the opportunity to know each other sincerely and have the chance to confront and resolve their problems and apprehensions before living together for a very long time. I suggest that couples seek premarital counseling so that they would fully understand and value the meaning of marriage and family.Conclusion. In our modern culture many Americans no longer see the importance of marriage. They look at marriage as a private contract rather than a lifelong commitment. One can easily obtain divorce by simply writing â€Å"irreconcilable differences†. They forget that marriage has special obligations: 1) to love and respect each other; (2) to live together; (3) to make decisions relating to family life in the best interest of the family; (4) to maintain and teach their children â€Å"in accordance with their capacities, natural inclinations, and aspirations†; and (5) the right and duty of each spouse to manage the household. (Spaht 469).Marriage is a social institution and the foundation of every family. As a moral fiber of American society, families must be protected by all means. It is the duty of all citizens. However, the government must take steps to enact laws in preserving family values as well as formulate and invest in social programs that strengthen marriages.Counseling is a helpful tool in rescuing marriages. That is why I advocate for the passage of bills that would require couples to attend mandatory marriage counseling before they can obtain their license so that they be educated on the responsibilities and commitment they have to render to society and their families. Should it be necessary, the rules on divorce must be strict and that â€Å"no-fault† divorce must end.The government must set goals to reduce divorce and campaign on its risks. Community-based marriage programs are advantageous to assist couples in getting married and monitor those marriages that are endangered. In this way, any problem would be resolved immediately. By saving marriages, we save our families.ReferencesGottman, John and Silver, Nan. â€Å"The Seven Principles for Making Marriage Work: A Practical Guide from the Country's Foremost Relationship Expert†. Three Rivers Press, New York. 16 May 2000.Bramlett, Matthew D. Ph.D. and Mosher, William D. Ph.D. Cohabitation, Marriage, Divorce, and Remarriage in the United States. Vital and Health Statistics, Series 23, No. 22. Department of Health and Human Services. July 2002. 10 April 2007 http://www.cdc.gov/nchs/data/series/sr_23/sr23_022.pdfLeslie, Mark A. Legislative Efforts to Strengthen Marriage. Public Law Research Institute. University of California Hastings College of Law. 2004. 10 April 2007 http://sierra.uchastings. edu/plri/spring98/marriage.htmlSpaht, Katherine Shaw. Covenant Marriage: An Achievable Legal Response to the Inherent Nature of Marriage and its Various Goods. Ave Maria Law Review. Vol. 4:2. 2006. 10 April 2007 http://www.avemarialaw.edu/publications/lawReview/articles/AMLR.v4i2.spaht.final2.pdf

Learning Organizations Essay

1. 1 Executive summary/ L. O! In times of uncertainty and change, organizations need new and effective managerial tools in order to cope with the rising competitiveness of markets. In this context, the concept of organizational learning is receiving growing attention among both managerial and academic surroundings in the last two decades. Among many possible definitions of a Learning Organization, David A. Garvin, a leading scholar in this field, suggests the following: â€Å"an organization made up of employees skilled at creating, acquiring, and transferring knowledge. These people could help their firms cultivate tolerance, foster open discussion, and think holistically and systemically. Such learning organizations would be able to adapt to the unpredictable more quickly than their competitors could. †. A learning organization is aimed at increasing the flexibility and effectiveness of a company, making it react faster to changes in a competitive environment. This is achieved in cultures who constantly foster knowledge inside their organizations. Although this general idea of organizational learning may appear rather simplistic at first glance, it’s practical integration into day-to-day operations proves to require a more refined, systematic approach: â€Å"Generative learning cannot be sustained in an organization where event thinking predominates. It requires a conceptual framework of â€Å"structural† or systematical thinking, the ability to discover structural causes of behaviorâ€Å". This paper provides a deeper insight into the implementation and performance assessment of learning organizations (L. O. ’s), mainly using the Three Building Blocks Model outlined by Garvin, Edmondson & Gino. To better understand this concept, the work will rely on Xerox as an example to highlight how L. O. ’s can provide competitive advantages to corporations. In the last section, the paper will also breakdown the effect that learning organizations have on major stakeholders (leaders, employees and organization itself). 1. 2. Introduction: Background to Xerox Xerox is a US-based multinational, founded in 1906, which produces and sales printers and photocopiers and provides related services. Throughout it’s history, Xerox has faced several crisis periods which ended up pushing the company to become a Learning Organization. Around 1980, the company was hit hard by the emergence of new japanese players on the market and lost its almost 100% market share. As a response Xerox introduced the â€Å"leadership through quality initiative† with the objective of training every employee in tools for generating ideas and collecting information, solving problems in a systematical way, reaching consensus etc. â€Å"Xerox became a case study — the first American group to win back market share from the Japanese†. More recently, in the year of 2000, with the announcement of Anne M. Mulcahy as CEO of the company, XEROX’s was able to overcome another serious crisis. Mulcahy’s leadership style, which mirrors many of the strategies suggested by the LO literature, managed to turn around this †sinking ship†, which had 19 billion in debt, a falling stock and double-digit negative growth. In 5 years time, Xerox would be profitable again. Ursula Burns has continued Mulcahy’s work, since becoming the new CEO in 2009, even acquiring new companies such as the 2010 $6. 4 bln. takeover of ACS. Xerox continues to stay on the list of companies frequently cited as learning organizations. The 3 Building Blocks of a Learning Organization The concept of the three building blocks of a learning organizations is introduced by David A. Garvin, Amy C. Edmondson, and Francesca Gino as an assessment tool to determine areas where organizations need to improve their learning methodologies. Below we provide a deeper explanation of each of the three building blocks and how Xerox fits each one of them. Building Block 1: XEROX, a supportive learning organization? There are four distinct characteristics of an organization that determine whether it is or not a Supportive Learning Organization. Firstly, how psychologically safe its employees feel. This is common in organizations where employees don’t feel pressured or marginalized when presenting their own ideas even if these go against what the majority of the organization thinks. Similarly, subordinates at this organization are encouraged to disagree with their coworkers and superiors and present new and bold opinions, meaning that this organization is opened to new ideas. In a supportive learning organization, employees also become aware of the different inputs and opinions each member of a team brings to the table and learns how to accommodate and value those differences. Lastly, a supportive learning organization needs to provide its employees with some time for reflexion, when they will to go over the company’s procedures and analyse past performances in order to assess what can be changed and/or improved. Tolerance and diversity at Xerox Xerox’s openness to new ideas can be partly linked to its high diversity of employee backgrounds, which ultimately reinforces the acceptance and inclusion of different solutions, making employees feel more comfortable in taking risks. This diversity has also enabled Ursula Burns, the current CEO, to climb up the ranks of Xerox and become the first female black CEO of a Fortune 500 company. Besides being â€Å"a proof† to other employees that effort at Xerox pays back, Burns herself stresses this idea of a supportive learning organization when she mentions that she â€Å"wants [XEROX’s] 130,000 employees to get over the past, take more initiative, become more fearless and be more frank and impatient with one another to ratchet up performance†. Burns refers to the all Xerox community as the â€Å"XEROX family†- â€Å"When we’re in the family, you don’t have to be as nice as when you’re outside of the family,(†¦ ) I want us to stay civil and kind, but we have to be frank — and the reason we can be frank is because we are all in the same family. † Building Block 2: Does Xerox implement concrete learning processes and practices? Because â€Å"a learning organization is not cultivated effortlessly†, organizational entities must put explicit processes in place to ensure that knowledge is constantly generated and collected inside the organization. The information must then be interpreted and infused into the organization to be always accessible in a way that will support problem-solving tasks and benefit its constant transformational processes. Moreover, this will also help to develop new products or services, as well as closely monitor competitors, clients and technological developments, using benchmarking techniques. Lastly, the company has to invest in training measures for its employees. MAIN Education and problem-solving at Xerox: The Six Sigma Method In the case of Xerox, measures to implement LO practices started as early as 1983 when executive management inaugurated Xerox’s â€Å" leadership through quality initiative†. The initiatives goal was â€Å"improving business processes to create higher levels of customer satisfaction, quality and productivity† by providing workshops to Xerox employees. These workshops were refined in the late 90’s, reorienting around the Six Sigma method, which had previously been successfully applied in other companies. Although these efforts proved successful in improving productivity, they were only limited to a local supply chain level and were not conducted regularly. In 2002 the management of Xerox then decided to implement the Six Sigma strategy across the whole organization, an effort which Xerox is continuing today. This is shown by the fact that the method has become part of the everyday communication process inside the company. The Six Sigma strategy is a tool, which empowers employees to become more efficient and proactive in daily problem-solving situations, for example by using the DMAIC (Define, Measure, Analyze, Improve, Control) approach. Six Sigma also requires the employees to closely monitor market trends and to apply benchmarking appropriately. Xerox particularly emphasizes the fact that they see the efforts to implement the Six Sigma method (see attachment 1) as a long-term project. This idea is aligned with the academic literature on LO’s stating that â€Å"becoming a LO is a long process and small setbacks should be expected†. This is because employees and the management have to â€Å"unlearn† old modes of thinking. Information distribution at Xerox Xerox provides employees with access to a large intranet consisting of e. g. reference knowledge, material on best practices, and answers to frequently asked questions. This helps the stakeholders inside the company to share information. It also supports the efforts to keep employees informed on what the priorities are for the overall company. Building Block 3: Are Xerox leaders reinforcing learning? Leaders in a L. O. promote constant learning by raising difficult questions and listening to the answers and concerns of their employees. While doing so, leaders also communicate openness to these new ideas and take them into consideration in their actions. Additionally, leaders have to encourage employees to invest their time in reflecting on both how to solve current problems and what can be learned from past performance. The ultimate goal is for leaders to motivate employees to question the underlying assumptions of current modes of thinking, and therefore initiate efficiency and innovation inside company processes. Promoting Initiative at Xerox For the past two decades, Xerox has engaged their employees to participate in the Earth Awards Program. The goal of this yearly event is to come up with solutions for saving company resources by increasing its efficiency, therefore making it a â€Å"greener† company. With this challenging program, Xerox motivates their employees to generate new ideas that, for instance, in 2010, resulted in company savings of $10. 2 Million. In that year, thirteen winners were announced, corporate wide and among different teams. This is an example of how leaders take their employees’ input seriously and how the generation of new initiatives at Xerox arises from both top and bottom levels of hierarchies. Encouraging employees to invest their time in reflecting by example Senior management at Xerox demonstrates the behaviors, which they in turn expect from employees. A clear example of this â€Å"policy† was when, in 1993, the executive management put together the Presidential Review process. The objective of this process was to review the overall progress of the company collectively through Presidential Review process in 1993. Interviews were organized with more than 30 senior managers answering questions like â€Å"What has changed? Where are the largest gaps between what was intended and what is currently true? If you were to outline barriers that need to be dealt with, what comes to mind? What would you have done differently? †. After the interviews, 45 seniors got together for one day meeting to identify trouble spots and develop recommendations. Action plan was the result . 3. The Effect on Leaders, â€Å"Followers† and Organizations Becoming a successful learning organization can provide a company with significant competitive advantages in the long-run, as it also can largely benefit its major stakeholders (employees and leaders). However, it also requires some behavioral changes from them. In order to achieve the goal of a L. O. (foster knowledge creation and sharing to gain competitive advantage), it is important that leaders infuse a common goal inside the organization. This implies, that leaders should have an effective communication in delivering the company ethos to their subordinates. Once employees identify with the company and its goal, people on all levels of the company would naturally start thinking and discussing promising new ways to achieve these goals. On the other hand, learning processes require time among other resources, and eventually leaders will have to find efficient ways to maximize the time of their employees. It is crucial to determine a balance between time spent going over problem-solvings tasks and past performance analysis (required for learning processes) with regular work. Additionally, leaders will have to define the line between â€Å"acceptable mistakes†- those that arrive from risk taking attitudes, and â€Å"unacceptable mistakes† – those originated by irresponsibility and lack of accountability. This is not always clear and, therefore, leaders might face some obstacles in implementing a learning culture as their workers’ â€Å"fear of punishment† can result in the limitation of creativity. Probably the most effective tool to boost innovation is to empower workers. But if the empowerment process provides employees the feeling that they are contributing and helping to define the company processes, then a new attitude is also required from them. Employees will have to remember that they are expected to show initiative, propose new ideas and act. And they should not always expect directions to do so. This can be particularly hard for workers who are risk-averse and who need clear instructions about their work role. Learning organizations can bring significant benefits to employees. Being part of the company processes transformation and being aligned with its goals are expected to make employees more motivated and dynamic. In this way, many of the aspects of the L. O. raise the levels of enjoying the work process. The job satisfaction in turn is expected to raise productivity levels. Also, because employees are more exposed to those in higher positions in the company, new career opportunities might arise together with monetary rewards. RISKS FOR COMPANY â€Å"No learning organization is built overnight. Success comes from carefully cultivated attitudes, commitments, and management processes that accrue slowly and steadily. The first step is to foster an environment conducive to learning. Analog Devices, Chaparral Steel, Xerox, GE, and other companies provide enlightened examples. † (http://w3. ualg. pt/~mzacaria/gic/HBR-Building-a-Leaning-Organization. pdf) 2. Organizations should be careful in applying new principles ensuring buy-in from most influential employees and checking progress not to fall into the trap of unfeasable change which could seriously hurt current business (see http://knowledge. wharton. upenn. edu/article. cfm? articleid=268) 4. Final considerations: As illustrated by the above analysis, as well by its overall economic performance in the last 11 years, it has become clear that XEROX has largely succeeded in becoming a LO. Arguably, Xerox has become so successful in it’s LO efforts that this has resulted in providing learning services to other companies through subsidiary spin offs, such as Xerox Learning Services. Concerning the evaluation of the theory proposed by Garvin, Gino and Edmondson, it has to be noted that the building blocks have to be seen as interdependent. Without effective leadership and learning environment, the learning process implementation will likely fail. Therefore, each of the above building blocks needs to be tackled by taylormade strategies, not least because companies do not perform consistently in each department. Similarly, organizations have to pay especial attention to comparing the extent of the learning process with other organizations, since only then you will have a solid benchmarking (in contrast to looking only at individual company performance over time). Attachment 1 ——————————————– [ 1 ]. O’Keeffe, T. 2002. Organizational Learning: a new perspective. Journal of European Industrial Training, 26 (2), pp. 130-141. [ 2 ]. Peter Senge (1990), â€Å"The Fifth Discipline† [ 3 ]. â€Å"Is yours a learning organization? † [ 4 ]. One good source on Xerox crisis times http://knowledge. wharton. upenn. edu/article. cfm? articleid=268 [ 5 ]. Building a L. O. [ 6 ]. http://www. economist. com/node/387740 [ 7 ]. http://www. economist. com/node/387740 [ 8 ]. http://mitleadership. mit. edu/r-mulcahy. php [ 9 ]. The following work will assume that the stance of the management towards encouraging the LO inside Xerox has remained constant. Since Mulcahy had been working with Burns for more than 9 years, Burns is expected to â€Å"put her own stamp on the company in a way that was deferential to the work of Ms. Mulcahy, who remains chairwoman. † See: http://www. nytimes. com/2010/02/21/business/21xerox. html? pagewanted=all&_r=1& [ 10 ]. http://www. freepatentsonline. com/article/SAM-Advanced-Management-Journal/20982068. html [ 11 ]. http://www. businesswire. com/news/home/20041027005036/en/Diversity-Practices-Organization-Recognizes-Xerox-Diversity-Leadership [ 12 ]. Farmer, Paula (August). â€Å"The First African American To Head A Fortune 500 Company, Franklin D. Raines Takes Over Fannie Mae†. The Black Collegian. Retrieved November 7, 2008. [ 13 ]. Bryant, A. (February 20, 2010) Xerox’s New Chief Tries to Redefine Its Culture, The New York Times [ 14 ]. Bryant, A. (February 20, 2010) Xerox’s New Chief Tries to Redefine Its Culture, The New York Times [ 15 ]. Garvin, Edmondson & Gino (2008), p. 4 [ 16 ]. Page 11: http://www. xerox. com/downloads/usa/en/n/nr_SixSigmaForumMag_2004_Aug. pdf It could be argued that these efforts were a spillover-effect from Xerox ground-breaking benchmarking efforts in its production process areas in billing, warehousing, and automated manufacturing. [ 17 ]. Page 13: http://www. xerox. com/downloads/usa/en/n/nr_SixSigmaForumMag_2004_Aug. pdf [ 18 ]. Slide 68:http://www. moyak. com/papers/learning-organization-presentation. pdf [ 19 ]. Easterby-Smith, M. , Crossan, M. , and Nicolini, D. 2000. Organizational learning: debates past, present and future. Journal of Management Studies. 37 (6) pp 783-796. See also Senge’s definition of â€Å"mental models†, which refer to how workers need to time to overcome old modes of thinking: Senge, P. M. 1990. The Fifth Discipline. London: Century Business. [ 20 ]. http://www. xerox. com/downloads/usa/en/n/nr_SixSigmaForumMag_2004_Aug. pdf [ 21 ]. Kaye, L. (November 15, 2010) Xerox’s Green Ideas Save Company $10. 2 Million, http://www. triplepundit. com/ [ 22 ]. Garvin, D. A. (2000), Learning in Action: a guide to putting the learning organization to work, Library of Congress Cataloging-in-Publication Data – p. 105 [ 23 ]. Garvin, D. A. (2000), Learning in Action: a guide to putting the learning organization to work, Library of Congress Cataloging-in-Publication Data – p. 105 [ 24 ]. Emerald Group Publishing Limited. : ImageXerox lean six sigma framework. Figure 3Xerox lean six sigma framework. emeraldinsight. com http://www. emeraldinsight. com/journals. htm? articleid=1628232&show=html.

Benefits of Data Mining

Data mining is defined as â€Å"a process that uses statistical, mathematical, artificial intelligence, and machine-learning techniques to extract and identify useful information and subsequent knowledge from large databases, including data warehouses† (Turban & Volonino, 2011). The information identified using data mining includes patterns indicating trends, correlations, rules, similarities, and used as predictive analytics. By employing predictive analytics, companies are actually able to understand the behavior of customers. Predictive analytics examines and sorts data to find patterns that highlight customer behavior. The important behavioral patterns are those that indicate what customers have responded to and will respond to in the future. Also, patterns can indicate a customer base that is in jeopardy with the company, customers that are not company-loyal and are easily lost. Predictive analytics of customer behavior can be of great benefit to the business (Turban & Volonino, 2011). Companies are able to build specific marking campaigns and models such as direct mail, online marking, or media marking based on customer preference and are better able to sell their products to a more targeted customer base. Knowing what the customer wants, what they will respond to, and which customer base to focus on takes the guesswork out of marking and product development. Taking the information retrieved and using it correctly will only increase profits (Advantages, 2012). Association discovery using data mining provides a huge benefit to companies. Association discovery is finding correlations or relationships between variables in a large database. For example, in terms of a supermarket, it is finding out that customers who buy onions and potatoes together are also highly likely to buy hamburger meat. These correlations where one set of products predict the buying of another is referred to as associations. Data mining can employ association discovery allowing business to predict buying patterns and allow for more effective operations management and can better pinpoint marketing strategy of coupons and incentives (Association Rule 2012). Web mining is another aspect of data mining. Web mining uses the data collected on the Internet to analyze customer data and gather information beneficial to the company. Any time someone visits a website, uses a search engine, clicks on a link, or makes an electronic transaction data is generated subject to analytics. Companies use web mining to gain customer preference and insight. The information gathered is used to improve websites and create a better user experience for the customers. Web mining can also be used alongside of predictive analytics. For example, on e-commerce sites every transaction is analyzed. When a customer clicks on a product, web mining tools can present a list of products he/she may also be interested in because of other customers with the similar buying interests/habits. This tool can be extremely effective in gaining business intelligence of the buying habits and preferences of customers (Turban & Volonino, 2011). Data mining also employs clustering to find related customer information and to provide valuable information to the company. Clustering gathers information and designates clusters of similar products and objects. In data mining, clustering is usually the first step. It identifies similar information and groups them to be further examined. Customer information and demographics are an example of these clusters. The group characteristics are analyzed against desired outcomes to understand the buying habits of customers and what marketing campaigns will enhance customer response (Ali, Ghani, & Saeed). Reliability of Data Mining The benefits of data have been examined, but it is important to look possible implications as well. Data mining uses algorithms to predict patterns and customer behaviors. Constant measures are needed to make sure the algorithms are working correctly, but the issue of reliability stems a little deeper. Algorithms and data analysis can only be as reliable as the actual data analyzed. Data gathered from different sources can potentially be t or even conflicting. This greatly affects the validity and result of algorithm, especially predictive analysis. It could alter the customer’s historical purchases or demographic information rendering the information useless and even costly. Data mining is a useful tool and should be trusted up to a point. It should not be the only solution. Companies should not only use data mining for marking and operations decisions. The costs of mistaking customer preference and predicting behavior could be catastrophic (Data Mining). Privacy Concerns of Data Mining. One of the major disadvantages of data mining is the privacy concerns associated with the technique. Three major privacy concerns raised by consumers are identity theft, misuse of personal information, and the â€Å"big brother is watching you† feeling (Orwell, 1954). The first concern is identity theft. With the increasing trend of e-commerce and electronic funds, identity theft has been a huge issue. The sheer amount and speed of information processing through data mining has led to a rise in identity theft making this valid concern. The information could easily fall into the hands of anyone (Exforsys Inc, 2006). The second concern is the misuse of personal information. Companies gather information as specific to customer purchases, names, phone numbers, addresses, and other information then store it in a database. Once obtained, copies can be made with little effort. Companies can easily sell this information to other companies. This is the exact concern of consumers. Consumer information can certainly be misused, exploited, or for discrimination making this a valid concern (Advantages, 2012). The last concern addressed in this paper is the total loss of privacy, feeling controlled or watched. The government uses data mining to track patterns of criminal activity have considered using the technique to track the movement of people. Some people feel this goes too far, and not giving the consumer the choice of having his/her information in the database takes away personal freedom. This concern is tied into the misuse of information because what stops companies to selling information to governmental or private agencies with the sole purpose being to control or watch an individual. With the volatile nature of crime, and the increasing use of technology by government agencies, this concern is also valid (Advantages 2012). Measures have been taken to alleviate these concerns. Companies that utilize data mining are required to take certain actions that protect their customer’s privacy. One of these actions is to remove and identity related attributes from each customer record before the data is transferred to analysts. Also banks allow for identity theft protection services to alleviate the concern of financial security. All of these concerns are still important and steps will have to be continuously made and adjusted to protect the security and privacy of personal and financial information (Li & Sarkar, 2006). Real World Examples of Predictive Analytics Predictive analysis and how it is beneficial to companies has been discussed above in theory. To completely understand how predictive analysis is used is to look at real world examples. The first example is how a fast food restaurant used HyperActive Technologies to predict what customers might order. HyperActive Technologies developed a system that allowed cameras to track vehicles pulling into the parking lot and track customers through the entire ordering process. Using predictive analysis of the data gathers from the cameras, the restaurant was able to conclude that at lunchtime; approximately twenty percent of cars entering the parking lot would order at least one cheeseburger. With this information, the cooks were able to get a head start in food production cutting down on wait time for customers and increasing overall productivity (Turban & Volonino, 2011). Another example of a company that uses predictive analysis is that of INRX, the leading provider of traffic information. INRX uses data mining by evaluating real time traffic measuring traffic problems and congestion. This data is collected from road censors, toll tags, traffic incident data, and commercial vehicles equipped with a GPS that continuously report their speed and location. Using predictive analytics, the data is studied to determine traffic patterns at certain locations and times. Drivers now have access to real time traffic information. This information has proven to be extremely effective and useful to drivers allowing them to make better decisions and avoid unnecessary delays (Turban & Volonino, 2011). The flower company, 1-800-FLOWERS. om, has also used data mining techniques, specifically predictive analytics. The company collects and analyses data at all contact points. Data collected includes historical purchases to discover trends, anticipate customer behavior, and meet customer needs and preferences. This technique has proven to be an effective way of increasing the response rate to customers, identifying profitable customers, and establishing customer loyalty. Customer reten tion increased by over fifteen percent after the implementation of predictive analytics solidifying its effectiveness (Turban & Volonino, 2011). As shown through academic research and real world examples, data mining is a real and effective way of predicting customer behavior and buying patterns. Measures need to be taken not only to overcome the stigma that data mining is unsecure and takes away personal freedom, but to make sure individual information is, in fact protected. If these measures are taken, data mining is a win-win for both businesses and consumers. Consumers will feel heard, understood, and taken care of. Businesses can actually focus resources on building that business-to-customer relationship and will be able to give the people what they need. References Advantages and disadvantages of data mining (2012). Retrieved December 9, 2012 from http://www.dataminingtechniques.net/data-mining-tutorial/advantages-and-disadvantages-ofdatamining/ Ali, R., Ghani, U., & Saeed, A. (n.d.) Data clustering and its applications. Retrieved December 5, 2012 from http://members.tripod.com/asim_saeed/paper.htm Data mining: issues. (n.d.) Retrieved December 7, 2012, from http://www.anderson.ucla.edu/faculty/jason.frand/teacher/technologies/palace/ issues.htm Exforsys Inc. (2006). Data mining privacy concerns. Retrieved December 5, 2012 from http://www.exforsys.com/tutorials/data-mining/data-mining-privacy-concerns.html Li, X. & Sarkar, S. (2006) Privacy protection in data mining. Retrieved December 6, 2012 from http://dl.acm.org/citation.cfm?id=1245621 Turban, E., & Volonino, L. (2011). Information technology for management improving strategic and operational performance (8th ed.). New Jersey: John Wiley & Sons, Inc.

Comparison between the characteristics of citizens of Germany and Essay

Comparison between the characteristics of citizens of Germany and Qatar - Essay Example As it is explained in the book â€Å"Culture Smart: Germany†, Germans make their best effort to complete a task within the time assigned, and make sure that they do the work rightly the very first time it is done. In short, we can say that they are too committed to their jobs and respect the deadlines. When I compare that to the trend in my country, Qatar, I find a huge difference because most of the people in Qatar are too careless about the work deadlines, and more often than not, work is completed after the deadlines. Regardless of the religion or cultural differences with Germans, I respect them as a Muslim for their hard work, because in Islam, we are taught to do everything with extreme enthusiasm and professionalism. In one saying, our Prophet Mohammed has conveyed that God loves it when someone does something and he/she does it well. Another characteristic that I particularly like about Germans is their straightforwardness. Germans have a habit of saying straight whate ver they have in their mind, and they do not feel any hesitation or embarrassment in being truthful in their speech. There is no hypocrisy in them. Thus, whatever they say, they mean it and they do what they think is right. Straightforwardness to such a high extent may sound rude occasionally, but for me it should not be taken like that. I feel that one should welcome criticism as long as it is just. I would not mind someone telling me to correct myself in a particular way if I am really wrong in that. In my country, people frequently make use of flattery for personal gains. This is a sign of hypocrisy and is strictly forbidden in Islam. In addition to their straightforwardness, I like German’s truth.

Film analysis with historical references - Cidade de Deus (City of Research Paper

Film analysis with historical references - Cidade de Deus (City of God) (2002) - Research Paper Example The book was written by Paulo Lins, who was born in 1958 in Estacio, a black district of Rio, close to the docks; and later was rehoused in the City of God after the disastrous floods of 1966 (Lamnews, 2004). Living in the broken city with almost no infrastructure, Paulo experienced the dark side of the favela – the local gangsters, drug dealers, murders and thefts. The book was later turned into a feature film in 2003 that was critically acclaimed around the world, was nominated for four Academy Awards and gave a deep insight on the burning issue in Latin America – youth violence, crime and drugs (Oliveira, 2009). This write-up attempts to analyze the movie Cidade de Deus (City of God) in the historical and present context of youth violence and crime in Latin America. The Story of Cidade de Deus (2003) The movie "City of God" opens with a frantic chicken escaping slaughter hounded by a gang of pistol-packing prepubescents. The chase leads the protagonist, photojournali st Rocket (Alexandre Rodrigues) in the middle of a proxy gunfight between the gangsters and the police. In a way, the first scene depicts the essence of the movie where Rocket is finding his ground between his two worlds. The movie unearths the decline of â€Å"City of God† over the span of 15 years, from a sunbaked ghetto of earth-colored houses having children playing soccer games and petty thievery in front yards into a sinister slum swarming with armed adolescent gangsters dealing in cocaine and murders. In the middle of this change, Rocket narrates his life in the slum, a child of the 60s; he witnesses barbarity, greed, rape and revenge that fuel a catastrophic gang war. The movie is split into three chapters, each drearier and more horrendous than the one before; narrating through parallels, the interweaving destinies of Rocket and his childhood playmates, Li'l Dice (Douglas Silva) who changes his name upon growing up to Li'l Ze (Leandro Firmino da Hora) – an ult ra-violent, psychotic, drug-dealing socio-path. In the 70s, Li’l Ze’s only link to humanity is his lieutenant Benny (Phillipe Haagensen) whose murder leads him to be even more ferocious. Apart from dealing in hard drugs and combating with other gangs and police, Li'l Ze also â€Å"grooms† pre-teenagers (â€Å"Runts†) by supplying weapons and making them snoopers. A decade later, Li'l Ze's finds his empire threatened by the very Runts who rebel against his authority. It all builds up to a shootout between Li'l Ze and a rival gang leader Knockout Ned (Seu Jorge), a peaceable bus-fare collector turned avenger after Li'l Ze rapes his girlfriend and shoots his brother. Rocket, on the other hand, despite living in the middle of violence, escapes from the criminal life through his passion for photography. His sensational photo of Li'l Ze and his posse ends up on the front page of a newspaper. Surprisingly, Rocket is encouraged by the publicity-hungry thug to be his court photographer. Most of the movie's final bloodbath is witnessed through his camera's lens. The narration of City of God uses many close-up shots, extreme close-up shots and flash backs making the movie very gripping. Gangs and Crime in Latin America Youth gangs are among the core features of the landscape of violence in Latin America and the Caribbean. Known by many names, pandillas, maras, bandas, galeras, quadrilhas, barras, chapulines, they are permeating throughout the territory, and are

Would You Be Willing To Swear A Hippocratic Oath Essay

Would You Be Willing To Swear A Hippocratic Oath - Essay Example With this concern the associate justice opined that lawyers should also be encouraged to swear a Hippocratic Oath, similar as the doctors. It is since then that the aspect have attracted various comments and headed to as a major controversial issue in the history of legal profession (Rocca, 2008). After a long controversy it was again suggested that the law graduates should be spelling an oath which was presented as an option to the final year law students. It was in this context, that certain people felt it to be unnecessary for the legal profession while few were in the favour of the oath (Laycock, 2010). However, the question still comes into view regarding the appropriateness and its efficacy in the realistic practices of the legal profession.... nt, it can be stated that the oath in actual terms can be highly beneficial for the society by reducing the occurrences regarding the misconducts of legal profession. It is worth mentioning that the professional and the ethical responsibilities of a lawyer play a major role in signifying the requirement of a Hippocratic Oath, which is in turn strictly driven by the legal system of a society. The legal systems practiced in the society are enforced with the ultimate objective to ensure the behaviour of the people is against any kind of crime or harm. Whereas, in technical terms these enforced legal systems are the accumulated versions of certain well-defined and specified statements to regulate and control the living of the society. Therefore, the statements need to be re-enforced in the real life practices and accordingly require to be monitored with the aim that the actions of peoples are not against the legal boundaries (Webb & Et. Al., 2007). Moreover, the actions needs to be judge d in-depth as in the practical consequences, it is not always that a person performing actions which are against the legal statements can be termed to be a criminal. For instance, a person who has committed a murder to protect himself in self-defence cannot be termed as criminal. Hereby, it is the duty of the lawyer or the legal professional to prove the real fact. Therefore, the core responsibilities of a legal professional are to increase the efficiency of legal statements and enhance the societies’ well-being. To be summarised, it is the professional responsibility of a lawyer to signify the efficiency and the integrity of the legal systems enforced to regulate and control various actions of a society. Therefore, the professional responsibility of a lawyer is of crucial value to the

Case#6 Case Study Example | Topics and Well Written Essays - 500 words

#6 - Case Study Example With regard to its definition, a visionary leader is a leader who is able to articulate their dream for an organization and inspire followers, allowing them to move together towards a shared dream of the future. The basis of my definition is that the ultimate role of visionary leadership is facilitative and an ideal principal is often to merely facilitate the vision rather than single handedly transforming an organization (school) within a given period of time (Mendels, 2012, P.55, Column 2, L. 2). As seen in the case study, Susan is seen alluding to a community culture means she is indirectly calling to attention the important of the beliefs, values as well as the collective thoughts of those who belonged to the broader community of the school. This is likely to be based on her strong personal belief that developing a school vision is a collective responsibility that should be carried out by all members and stakeholders of the broader school community. Generally, the potential conflict between professionalism and democracy often take a number of forms. Democracies often require taking into account the opinions of other members of an organization before making decisions. However, this may result in a time consuming bureaucratic process that may negatively affect efficiency and professionalism in the school or organization as more time may be required and compromise may have to be reached. For Example, during administrative decision making, responsiveness may require adherence to professionalism while the principle of democratic accountability demands adherence to the popular will or democracy (West-Burnham, 2003, P. 10, L.7). Based on my knowledge of school administration, the role that the principal plays in the building of the school vision is simply be participate and facilitate reaching a consensus on a vision that reflect the collective thoughts of the broader school community as opposed to single handedly

The competitive advantage strategy for Diageo, Castel of brewery in Essay

The competitive advantage strategy for Diageo, Castel of brewery in Africa - Essay Example Africa is such an important region for Diageo due to the rich prospects that are found in Africa such as presence of mineral resources and its improvements in governance. Secondly, Africa provides diversity that matches Diageo’s needs. The global, financial, and economic situation, which has greatly affected Europe, has made the company to invest in the developing countries due to the increased prospects of driving growth. The company plans to invest in additional capacities to fuel growth in the continent such as adding more plants and equipments for brewing and differentiating their brands. Innovation is also considered by the company as a very good avenue for growth as well as having the right people who are motivated and interested in improving and fuelling growth in Diageo. Additionally, the company is committed to acquisitions and entrance into new markets as part of the strategies of facilitating its growth in the continent (Wehring 2012, np). The company enjoys a disti nct brand in its employment practices which promotes its ability to attract high caliber talents that are vital to its growth. The company further grows and develops talents as well as creating value chain in production and distribution process which highly contributes to their growth. Diageo are further involved in social economic development such as engaging in water projects and other agricultural projects which is integral in their business growth. Diageo has put unique strategy of growing the African talents in the continent to run its business by developing the current talents locally and bringing other Africans outside the continent. The company has embarked on a full year program to identify prospective African leaders who can take on senior positions in the company. The company is committed in its growth plan to develop a strategy that is capable of filling the gap between the talent required for growth and the current existing talents as well as attracting both the externa l talent and developing the internal talent. The company also ensures that they have dedicated talents that would add value to its operations as well as maintaining an effective and efficient operation (Wehring 2012, np). SWOT and PESTLE Analysis Diageo is the world leader in alcohol that comprises of beer, spirits and wine and enjoys a worldwide presence. The company, with its sound financial base, is capable of ruling the market by investing in R&D and acquiring other firms thus enjoying wider market share. The company usually manufactures the best brands and normally ensures best brands in its African market such as Scotch whisky. The company enjoys a wider market in Africa especially the rapid growth of 300m-consumers who due to the increase in the middle income earners in Africa. Diageo largely depend on the raw materials especially in Ethiopia and Kenya which is very vital for their growth in east Africa as well as wider market in that region of Africa. The company however, is faced with a number of challenges in some regions in Africa such as the unstable governments and lack of highly qualified expertise that they can depend on. There are also competitions from the local companies within the African region especially in Kenya and Tanzania that offer very low priced alcohol hence imposing a little threat to the

Nursing theory Assignment Example | Topics and Well Written Essays - 1000 words

Nursing theory - Assignment Example I see evidence-based practice as presenting an important for nurses to break away from past practice of nursing where nurses applied minimal professional knowledge with most of their interventions based on their subjective judgment on what they liked or disliked. Consequently, evidence-based practice trends in the delivery of quality nursing care has led to improved practice as decisions are now based on application of body of knowledge that focus on understanding and knowing patients and their health experiences, knowledge of research process essential in providing best interventions in particular cases. Among the theories that have contributed to the development of evidence-based, practice in nursing care is theory of interpersonal relations postulated by Peplau. Peplau’s theory focuses on the interaction of the nurse and the patient with the objective of ensuring nursing practice is therapeutic since it is a healing art. Through the theory of interpersonal relations in nursing, nurses and patients are perceived as individuals whose collaboration would lead to achievement of a common objective. Peplau prominence of the theory in nursing practice is influence by research findings suggesting that communication is important in establishing professional relationship between the nurse and patient and contributes to the nurse and patient learning and identifying the best approach in improving patient’s condition (Lubkin and Larsen, 2006). Introducing concepts in theory of interpersonal relations in nursing practice will therefore constitute evidence-based practice, as the n urse will relay on research to make an educated decision. The development of nursing theory has contributed to the improvement of nursing education, nursing research and nursing practice as practitioners seek effective and efficient interventions for conditions presented by different patients. Since the

Fast food restaurant Essay Example for Free

Fast food restaurant Essay The fast food industry has been growing dramatically during the last few years. For this reason, we should try to find out what are the several factors why fast food consumption keeps growing among young people. Therefore, as we have seen, the popularity of fast food is spreading rapidly among many people due to the following three main reasons: good taste, convenient time, and price. â€Å"Over the last three decades, fast food has infiltrated every nook and cranny of American society,† writes Eric Schlosser in Fast Food Nation. In the beginning, the fast food restaurant started with a cafeteria-style restaurant known as the â€Å"Automat† in New York on July 7, 1912. Then, in 1921, White Castle restaurants were started in Wichita, Kansas, selling hamburgers for five cents. By 1948, McDonalds was opened by two brothers from Nashua, New Hampshire, who developed the concept of selling hamburgers, French fries, shakes, coffee, and coca cola in disposable wrappings. So from its humble beginnings, the fast food industry has become an undeniable factor in our society. Certainly, with our ever increasing and busy society, eating at fast food restaurants has become the norm. Families that have busy schedules, such as taking their kids to various activities, attending church functions, and late meetings rely heavily on fast food as a meal choice. For example, about one-quarter of adults and a third of children eat at fast food restaurants on any given day. According to the American Journal of Public Health, consumers have spent $16. 1 billion in 1975 to $153. 1 billion in 2004 on fast food. People are generally drawn to good tasting food. With fast food, it couldn’t of ever tasted any better. No matter how unhealthy it is, we cannot deny that we have a love affair with the value meals, the fast service, home delivery and of course the drive-through. We no longer feel the need to slave away in the kitchen; we can just save so much time by satisfying ourselves with a relatively cheap McDonalds meal. It is ironic that in order to achieve the ever-increasing financial goals that we set for ourselves needed to feed our individual families, we must restrict ourselves from high quality food, the very diet that defines success, in favor of food that can be seen as more cost effective, and fast food fits the part perfectly. Moreover, the fast food industry has created many job opportunities for people who in normal circumstances would find work difficult to come by. Many young college students take on the challenge of working in a Burger King or Taco Bell kitchen in interest of supporting themselves financially. There are a countless number of students who decide to apply for jobs in the fast food industry to help them pay off their tuition. Working in the fast food industry can also be viewed as a potential transitional job for certain individuals. For in the present economy, many people have now found themselves jobless, while working in a fast food chain might not be desirable to them in comparison to their former jobs, it could be seen as a perfect temporary replacement while one searches for a new equally lucrative long term job. Some individuals go for fast food as they consider it to be a treat for themselves. There are many people who like fun and one of the best places that they can always get that is at the fast food restaurants. A part from just eating, they also find the places as socializing venues where they can make many friends. The fast food restaurants also offer a lot of entertainment zones that make their clients comfortable as they enjoy their meals; this is one factor that will make many people to prefer going there as opposed to cooking food for themselves at their homes. People also love fast food because there are so many of them next to their work place, their homes, on the side of the road or in any petrol station. That’s an important point to many people, because when they feel like having a fast food meal, they don’t waste a lot of time searching for a restaurant to eat from. They just find the restaurant near the place they are in. We cannot deny the world has undergone a fast food revolution over the past few years, and I believe there is good reason for the immense popularity of this fast food culture we are presently living in. It maybe greasy and unhealthy, but it is ultimately cheaper than home cooking and its convenience to the incredibly busy urban lifestyle is too significant to ignore. Fast food should be viewed as a positive aspect of our society as a result of the advantages it presents to us in our hectic lives, but we should not abuse it. In the words of actress Mae West: Too much of a good thing can be wonderful, however in this case it is quite the contrary.

Factors Influencing While Purchasing Tyres

Factors Influencing While Purchasing Tyres Abstract   In this project I have study of â€Å"factors influencing while purchasing tyres† JK tyres manufactured by Jk Tyre Industries. In this competitive era of marketing where the satisfaction of the customer towards the product is become first priority, it is therefore very important to analyze customer behaviour. Consumer behaviour can be looked upon as study of how individuals make decisions on how to spend their available resources like time, effort, money in various consumption related items. The understanding of customer needs and wants is one of the major underpinning construct of marketing. Without putting customer on the top company cannot get success, forgetting success every company should target customer, because market is totally customer oriented. This project evaluated which factors influence the customer most when he/she goes for purchasing tyres. Finally I have given some views and suggestions to the company with which they can satisfy the customer the most. Preface Inspite of theoretical knowledge gained through class room study, a person is incomplete if not  subjected  to practical exposure  of real corporate world. He may have to face hurdules, which will be difficult  to overcome  without any first hand experience of business. In this context, research program has been designed  to make aware of  happening of real business. The project entitled â€Å"Factors influencing  while purchasing tyres† with special refrece to JK tyres, has been done at New Delhi and Jalandhar as completion part of Msc International Business. In my work-based dissertation, we worked upon the analysis of the JK tyre industries in New Delhi and Jalandhar by customer attitude through  the personal contact and  questionnaires. During my work-based dissertation, I got opportunity to apply my theoretical skills and knowledge and meaningful concept to actual business condition and Familiarize  with the marketing activities of the products. All the work done on this  project is confined to my  broad objective. In today’s world of intense competition and rapid dynamism, all companies worldwide are tuning their focus on the customer. Suddenly, customer had succeeded in capturing all attention of the companies towards him, so much so, that maxim, â€Å"customer is god† has become so true and relevant today. There has been a paradigm shift in the thinking of these companies and none other than customer has brought this about. Earlier there was seller market, since the goods and services were in short supply and sellers use to call the shots. But ever since the advent of era of globalization there has been total transformation in the way of customers being perceived. Today, marketers are marketers are directing their effort in retaining customers and customer base. The customer importance has assumed imponderable proportion in today’s world because of inherent value that customers command. A customer can â€Å"make or break† the company. It is the responsibility of every company that to see all its customers are equally satisfied with them , for one single dissatisfied customer will tell at least nine other customer about the dissatisfaction and will spark off the chain reaction and spell doom for that company In the past customer were taken as ride, as there were not many players in the fields, not much importance was attached to product safety, quality, service and product appeal. The attitude of manufacturer was that of â€Å"Caveat-emptor†. Thanks to the government policies on liberalization, globalization and privatization, the market has changed today. Today customer has host of defence mechanism like customer protection laws, regulation of government, the powerful hands of organization, switching to or competitors. The maxim â€Å"Caveat-emptor† has been replaced by â€Å"Caveat-venditor†. In the past after sales service was consider as cost centre, companies were lethargic in attending the customer complaints. Availability of trainee service personal and quality genuine spare parts was serious problems. However, with rising competition, there could not be much product differentiation as product, quality was comparable and latest technology was with each and every company in the field.  Since there could not be much differential a tangible assets, the companies concentrated on the intangible assets normally service factor which served as major differentiator. Today after sales is considered as major aspect for every company and it is no more considered as cost centre but now it considered as profit centre Company profile JK tyre is only manufacturer of truck and bus tyres and second largest manufacturers of 4- wheelers. JK tyre and Industries in counted among the huge corporate entity which is the symbol of excellence, diversification and pioneering new technologies. Since its commencement it has been supreme in the value of technology which made it grow .JK tyre manufacturers and sells the tyres and tubes fot passenger car, truck, jeep, buses, multi utility vehicle,tractors and light commercial vehicle under its brand â€Å"JK tyre†. The company is the only manufacturer of ‘T’ ‘H’ high performance tyres in India. JK ranked â€Å"Highest in customer satisfaction with original tyres by J.D power Asia Pacific Study†. Its customers are mostly Replacement for four wheelers, entire Original Equipment Manufacturers (OEMs) in India along with state and defence transport units. Moreover JK have customer base across 45 countries and 6 continents.   Administrative Office: Link House, 3, Bahadurshah Zafar Marg,   New Delhi 110 002 http://www.jktyre.com/j-k-industries-limited.html Vision mission Vision â€Å"To be amongst  most admired companies in India committed to excellence† Mission  ·Ã‚  Be customer obsessed company  ·Ã‚  No. 1 Tyre Brand in India  ·Ã‚  Deliver enhance value to all stakeholders  ·Ã‚  Most profitable tyre company in India  ·Ã‚  Enhance global presence through acquisition  ·Ã‚  Motivated and committed  team development  for high performance  organization http://www.jktyre.com/j-k-industries-limited.html Key developments JK tyre industries Earning results for first quarter declared 30.06.09 For the first quarter company has reported  net profit of INR 40.75 crores or earnings of Rs 9.92per share on the Net Sales of INR 897.67 Crores In gross sales has been INR 964.58 Crores .The board [emailprotected] 27% dividend on equity shares for the financial year ended 31 march 2009 . Companies profit before tax had been INR 62.16 crores and operating  profit was INR 107.14 Crores. Performance  during the quarter has significantly improved on account of all round cost reduction measures, better operating  effeciencies, productivity, and richer product mix. First tyre company to receive ISO 14001. First and only tyre company to export passenger  car radial to Europe. World’s first tyre manufacturer to get QS9000 for its operation. India’s first to get ISO 9001. JK tyre is pioneer in promoting Rallying, karting, motor sports, JK tyre  pioneer of steel radial technology. Customer satisfaction JK tyre is the preferred choice of the all leading vehicle manufacturers in India like Maruti (http://www.jktyre.com/directors-report06.pdf) BEML (http://www.overdrive.in/story-news-general_news/jk_tyre_to_produce_otr_tyres-12662-0.html) Ashok Leyland (http://www.financialexpress.com/news/truck-tyre-mkt-on-road-to-radialisation/88811/) TATA Motors Mahindra Force motors Volvo (http://www.thehindubusinessline.com/iw/2008/03/09/stories/2008030950701100.htm) JK Tyre meets ISO 9001, QS9000, ISO14001,E-MARK, DOT,IN METRO standards where ever applicable. JK Tyres efficient RD department is deeply involved in making improvements in the product performance, quality, and bring out new products. Company aims to give satisfaction to its customer by offering high quality and cost effective tyres and tubes. (http://www.jktyre.com/quality-policy.html) History of the company On 14 February 1951 JK organization was incorporated as a private limited company. Till 31 March 1970, the company was involved only in the business managing agency. After that, company took manufacturing activities and in February 1972 company obtained the letter of intent for production of automobile tyres and tubes. In 1974 company manufactured 4 lakh automobiles tyres and tubes per annum then on 1st April 1974 company was converted into public limited company. After this company promoted manufacturing project, it was done by J.K. Synthetics Ltd and straw Products Ltd. The company took international step by collaboration with General Tire Co.,U.S.A.,which was subsidiary of General Tire Rubber Co.,U.S.A. ,this collaboration was for the technical services which was for about 5 years and sales agreement for the supply of technical know-how, engineer and documentation for operation facilities for eight years. According to the agreement, J.K. tyre had right to use on its products the wording made in the collaboration with General Tire Co. Company renewed its technical collaboration agreement for further 5 years. In 1987 apart from 51 days strike as well as go slow from 14 October  the overall working resulted in substantial profits. Since the strike was resolved efforts were made to launch a new pattern in steel belted Radial tyres and it was introduced for Maruti Gypsy and Tata Mobile by the company in 1988. The company proposed install latest and sophisticated RD equipement by incurring expenditure of Rs 300 lakh.   Due to RD in 1989 company introduced several new pattern and sizes of tyres including a semi-lug Nylon Truck tyre, and got good response from the market. In 1991 Hidrive Finance Ltd., Radial Finance Ltd., Handeep Investment, J.K International Ltd., J.K Asia Pacific, Shivdham Properties, Pancham Investment ltd., became the subsidiaries of the companies. By 1992 company international division expanded its activities by opening its office in Moscow( Russia) apart from company’s subsidiaries already in U.K and Hongkong. Market well accepted the radial tyres for tractors launched previous year. In 1993 company introduced new brands of radial tyres ‘Brute’ and ‘Ultima’. After this compony started manufacturing steel belted radial tyres for the prestigious cars like Mercedes Benz, Peugeot,Daewoo race and Opel Astra. Market well received the new patterns developed for bus and trucks ‘PE-T8’. Despite of rise in inputs cost and cost of raw material and the competion company maintained its progress. Company attained higher capacity and all around cost reduction on both plants at Jaykaygra and Banmore. Many new generation cars accepted the J.K steel radial as T- rated ultima launched and was accepted by Daewoo’s ‘Cielo’ and then Mercedes benz india also choosed J.K steel radial  after this it G.M’s ‘Astra’. Then next were `Peugekot FIATs, `UNO and M Ms `Ford. After this company launched premium tyre to meet heavy load market which was ‘Jet Trak’-39 with this company launched new tractor rear tyre ‘SONA’ which was also greatly accepted by the market. During 1996 company launched car tyre JET Drive XS,and nylon car tyre for maruti along with semi-lug and heavy duty lug tyre for trucks. In radial category, Ultima XR Radial, a terrain tyre was introduced. All these tyres got good response from the consumers. Companies both the plants were operated at full capacity. In radial tyres units also launched dual contact high traction and high performance Aquasonic steel radial car tyre. As company had loan repayment of Rs 635 crores it proposed to reduced its debt by 125 crore in 2000. J.K tyre and the Indian oil corporation came  collaboration to install digital air pressure gauges and setting up sales out at IOC petrol station across the country. In 2001 managing director of J.K Industries Raghupati singhania was selected 19th chairman of ATMA (Automotive Tyre Manufacturers Association). J.K Industries in 2003 got new Marketing Director as Mr. Ajay Kapila who was earlier  Senior-Vice President in Kinetic Engineering Ltd. J.K. tyres merged with Vikrant tyres along with the non tyre business, sugar and agriculture into separate companies which were J.K Sugar Ltd and J.K Agri-Gentics Ltd. On 2nd April 2007 J.K Industries Ltd changed their name to J.K tyre and Industries Ltd. (http://www.moneycontrol.com/stocks/company_info/company_history.php?sc_did=JKT01) History of JK Organisation JK Organisation owes its name to late Lala Juggilal Singhania, dynamic personality with broad vision. Inspired by the cause of Swadeshi movement of Mahatma Gandhi and driven the zeal to set up an Indian enterprise .Lala Kamlapat Singhania founded JK organization in 19 century ushering in new industrial era in India. The process of industrialization and diversification was worthily and successfully carried on by Lala Kamlapat’s illustrious sons –Sir Padampat, Lala kailashpat, Lala Lakshmipat, aided in no small measures by the Late Gopal Krishna son of Sir Padampat. (http://www.jktyre.com/founders.html) 1933- Juggilal Kamlapat cotton Spinning and Weaving Mills Co. Ltd was the first to manufacture calco prints in the country. In 1940 J.K iron and steel Co Ltd manufactured first time steel bailing hoops for jute and cotton with which country became self sufficient in meeting the entire demand. Then in 1944 they produced first time  aluminium virgin Metal from the Indian  Bauxite at  Aluminium  corporation of India Ltd, Jaykaynagar. There after J.K engineer files manufactures first time in India Engineering files in 1949. In 1959 they were the first one to set up a continuous process plant of Rayon.  In 1960 J.K Iron steel Co Ltd at Kanpur manufactured for the first time in the country a hydraulically operated cane crushing Mill for their sugar plant in Khandsari and then they completed their 100 ton plant. During 1961 J.K chemical set up world’s first plant for production Hydrosulphite of soda by the amalgamation process of sodium. Similarly in 1962 they their company J.K synthetics Ltd at kota produced first time nylon-6 with its own polymerised raw material in India. J.K Chemicals Ltd was the first one to produce sodium formaldehyde in India. In  1968 they produce T.V sets in India along with Metallic Cops for Synthetic Filament yarn  industries.  In 1969 J.K synthetics manufactured acrylics fibres in the country for the first time in the country and J.K synthetics Ltd developed Dyeable Nylon. In 1973 they were the first to the licence Synthetic fibre technology to third party and produce Synthetic Fibre Machinery. In 1976 they produce steel belted radial for the first time in india  for the trucks, buses and passenger cars in their tyre plant at kankroli and then they make steel belted radial tyres for three wheelers which was manufactured for the first time in the world. In 1984 they produced white cement in India for the first time in India  through dry process. Then J.K Synthetics produced Cathonic Dyeable fibre first time in India and nylon tyre cord based on Spin Draw Technology. In India J.K magnetic produced first magnetic tapes with cobalt technology.  In 1991 company set up a tyre palnt at Banmore with annual capacity 5.7 lakh tyres. Then in 1992 HASTERI RD centre was established bu the company after two years in 1994 they launched India’s first T-rated tyre and Banmore tyre plant crossed 100 TPD. Next year mecedez benz was launched on J.K tyres and they got the ISO 9001 which was given to first time in history to tyre manufacturer. In 1996  they introduced steel wheels and launched first time in India dual contact high traction  steel radial- aquasonic. Next was the big year for the compay they acquired Vikrant tyres ,awarded national export award for 96-97, first and the only tyre manyfacturer to get ‘E’ mark certification, they launched first H rated tyre and their research institute got ISO 9002.  In 1998 they were awarded capexil’s highest export award for 1997-98, got QS 9000. In 1999 Jk tyre was ranked world’s 16 largest tyre company, synergy with VTL in procurement, marketing and production flexibility, they got ISA-14000 certificate for environment and safety. In 2000 National Go-Karting  championships were introduced by the company. In 2001 company received CAPEXIL award and FOCUS LAC export award. In this year 2nd Go-karting championship was held by the company. (http://www.jktyre.com/milestones.html) Jk tyre acquisition of Mexican tyre company tornel JK tyre acquired Mexican based –company with the annual capacity of 6.6 million tyres ,this deal cost Rs 270 crores. This deal made the JK tyre No.1 tyre maker in the country as their annual capacity increased to 15 million units because they have surpassed Apollo tyres which was earlier No.1 with the capacity of 8-10 million. This acquisition not only gives JK tyres an additional tyres but access to the  lucrative market of Latin and North America. (http://web.ebscohost.com/ehost/pdf?vid=5hid=3[emailprotected]) The company is planning to sell both the brands JK and Tornel in U.S and Canada. They have planned to spend million more on the Tornel plants to add new shape to JK  brand and launch the JK radial and Tornel passenger and light truck brands  for U.S customers. (http://web.ebscohost.com/ehost/detail?vid=10hid=101[emailprotected]bdata=JnNpdGU9ZWhvc3QtbGl2ZQ%3d%3d#db=bthAN=35120934)   JK tyre and motor sports It’s been two decades that the JK tyre is closely related to adventurous world of motor sports. JK tyre has been constantly  promoting motorsports not just only to discover several winners, but also using their awareness and knowledge of RD department  to develop tyres on which world can race upon. JK tyre realised the absence of the infrastructure, which is necessary for the accomplishment of the motorsports in India. Over the last five years, JK tyre has embarked over Rs 15 crore to support the motorsport in India. (http://www.jktyre.com/motorsports/jk-in-motorsports-history.html) Global presence Jk tyre along with its associates Vikrant Tyres Ltd is the leading exporter of tyres from the country which counts roughly 26% of exports. JK tyre is the world’s first manufacturer of tyre to receive ISO 9000 along with QS 9000 for its operations. Across the world only JK tyre has received has certificate of QS 9000 for its multilocation operations. In the country it is only JK tyre was the first company to receive ISO 14001 in recognition of its environmental management systems. Nowadays, products manufactured by JK tyres compete with international players in the international market across the world. The products are exported to to more than 55 countries and in 6 continents. The company has robust and well developed distribution network for exports and the distributors get the full support from technical team for the product development so that they can meet the market requirements. JK tyre products are internationally certified in Europe, US, Middle East and South America. For commitment of offer in superior quality , standards and path-breaking breaking innovation the company has received numerous awards for exports for  last years.in 1999-00 JK being the largest tyre exporter to Latin America it was acknowledged  by the Indian trade promotion organization (ITPO).  In 200-01 company was honoured with ‘The Special Export Award’ from Capexil, with this company made its fourth consecutive award from India’s premier industrial association. JK tyre is constantly making any eefort to deliver value to customerswith along with sound marketing strategy forms which are establishment consistent performance in international market.   To develop new products of excellent and distinguished products so that they can compete in the international market, JK tyre had had maintained its marketing and distribution strategies for export market. This credit goes to India’s biggest in-house RD centre, HASTERI (Hari Shankar Singhania Elastomer And Tyre Research Institute). This centre is well equipped with latest testing facilities which helps in getting excellence by evolving technologies for superior product performance and it also reduces waste and thinks about the consumer needs. All over JK tyre has obtained many milestones. Despite of , bencjmarking customer sevice and plans to bring in several pioneering technologies there, a lot which will roll out in future in JK tyre’s winning path. (http://www.jktyre.com/global-business.html) JK tyres in North America In Mexican based company Tornel, JK tyre bought 100% stake. By this move JK tyre got access in the markets Of US along with this company can entered into the markets of South America. Tornel has total three manufacturing units with total capacity of 6.6.Million tyres per annum (http://www.business-standard.com/india/storypage.php?autono=319837) Technology at JK tyres Error proof Computer Aided Design Analysis JK tyres use updated tools and techniques which help them to figure out  and annihilate failure at the drawing board only. World class manufacturing on Automatic Machines Manufacturing of radials is done at air-conditioned plant fitted with the finest machinery to provide customer consistent good quality. Rigorous Testing Before the JK tyres reach the market it has to go through tough validation tests, both indoor and outdoor. Jk is one of the few companies that test their tyre so rigorously. Network of JK tyre Marketing Steel Wheels With the objective of meeting customer demand s and bringing best products and services form the customers, JK tyre established franchised chain nationwide retiled outlets as JK tyre steel wheels. It is considered to be one stop solution for the problems of and requirements of tyres and their services. In these they provide facilities like computerized wheel alignment, automated tyre changing, wheel balancing, air care, tyre rotation with the high technology and trained personnel guidance. Dial-a-tyre JK tyre has started delivering the tyre at the customer’s door. With this JK trained technician will deliver and fit the tyres at a pre-appointed time. In this wheel changing, balancing, and alignment is including. This step is user friendly to make the customer comfortable and for his convenience. AD-Campaigns JK tyre launched different types of ad campaigns to promote the product and the brand. The company publicized its product by placing its information in the media. Following are some of the ad-campaigns of JK tyres. Products JK tyre is leading manufacturer of tyres in India. It manufactures tyres  for entire segment of Truck/Bus, LCV, Passenger and Farms. Truck/ Bus-: JK Tyre is the leader in the segment of Truck/ Bus tyres. It has 70% market share in the truck and bus tyre segment. However this is very small sector Indian market but it is expected to grow in near future. They make Bias and radial types of tyres for this segment.   LCV-: In LCV segment they manufacturer such type of tyres and this they provide Bias and Radial. JK is the second largest  market share . Corporate social responsibility initiative by JK tyres J.K tyre believes that they get numerous inputs from the society, it adds value to these and offers the needed products and services to public at large. The profit which company makes is the enhancement by the public for value added. The purpose of CSR is enhance the government efforts by helping the citizen of the country, with which they can lead life which is prosperous, healthy, happy and more meaningful. It is believed that it is not only the job of the government to do the needful to the extent needed. That’s where the role of corporate citizen comes. In fact, it is helping ourselves because inputs and outputs comes from society and go back to society. So it is long run. J.K tyre and Industries undertook three major initiatives, 2004 onwards, as per deliberation in the central HRD Committee, presided over by Shri Hari Shankar Singhania, where all presidents and all time directors are members. Adult Literacy In 1950 the condition of china and india  was same i.e 18% of literacy. If the so huge population is illetrate then it is very difficult to imagine society making scientific progress and citizen leading purposeful and meaningful lives. From1950 there has been progress in this issue. China has got illiteracy 95% but our country got stuck at  65%. Looking at this J.K group took initiative, started  in may 2004  has made 6900 citizens of the country literate. Today, another 700 are participating in learning session in 30 groups at 10 different locations  in different six local languages viz. Tamil, Telugu, Kannada, Oriya, Gujarati Hindi, under the guidance of our plants local management. The company has target for the year 2009 which 3000 plus.  The various place where classes are taken are J Central Pulp Mills at Songadh in Gujarat], Lakshmi Cement in Sirohi Rajasthan, J K sugar nr. Barielly, Fenner [ Hyderabad Madurai], J K agri in Hyderabad. For this company use the software developed by M/s TCS at the locations. The photograph shows a class in progress in a village near Hyderabad, organized by J K agri.K Tyre [ Banmore nr. Gwalior, Vikrant in Mysore, Kankroli in Rajasthan], J K paper [Rayagada in Orissa Prevention Of Hiv / Aids : Focus on Outside Community Mainly truckers and their helpers who are highly attacked by the disease HIV/AIDS. Looking at this scenario J.K tyre started in November 2005, and is supporting three clinics in situated at National Highway at Indore, Dhanbad, and Vishwa karma Nagar. J K Tyre supports the work being done by Melinda Bill Gates Foundation in collaboration with TCI Foundation. Awareness is the main objective of the project so that people should use preventive measures. In ‘Infotainment Melas  which are held near the clinics company also participate , in these mela’s entertainment is combined with spreading message. Despite of 3 clinics run by TCI foundation and supported by JK tyre , one clinic named â€Å"JEEVAN KIRAN† which is fully financed by JK tyre has been opened in Nov 2007 at Transport Nagar, Jaipur and 2nd clinic at shahpura on NH-8, which 70 Km short of Jaipur on way from Delhi on 25th May 2008. It’s day-to-day operations are controlled and managed by NGO called, â€Å"Vatsalya†. Till now , in all five clinics more than 39000 persons have been attended to for ailments, of which 9590 were treated  for STI’s [sexually transmitted infection] and rest for general ailments. Suspected cases were  referred to government centres. Prevention Of Hiv / Aids : Inhouse , Focus on Our Employees JAN 2008 = MOU signed ; between ILO [Internationaal Labour Organization] for helping us in this endeavour ; also a 2 hr presentation was made to group of Sr executives by ILO. March 2008 = J K TYre HIV /AIDS POLICY was announced has been widely disseminated. Four pillars of this policy are : AWARENESS, NON-DISCRIMINATION, CONFIDENTIALTY CPOLLABORATION. APRIL 2008 = among employees a survey was carried out at all the location to assess the level of knowledge on the subject by an outside agency. MAY 2008 = among the employees training of 31 master trainers  by ILD took place who will address the other employees for 2 hour awareness session at all location. By the starting of July 2008, approximately 7000 employees took part in the  2 hour awareness program addressed by the Master trainers/Peer Trainersand this was highly appreciated by the workers and unions. HIV / AIDS, As additional initiative in 2008 for Observing WORLD AIDS DAY ON 1st  December 2008 Company joined  TCI foundation in observing the WORLD AIDS DAY at 13 locations across India [Delhi, Kanpur, Ghaziabad, Agra, Varanasi, Jaipur, Indore, Nagpur, Pune, Dhandbad, Jamshedpur, Hyderabad, Bangalore] The function called Truckers ‘Utsav was attended by 22000 truckers which combined awareness generation  with entertainment. Many invitations went out in transport community with J.K tyre logo. JK tyre also facilitates their products and banners and speaks few minutes about the company on the mike. (http://www.jktyre.com/corporate-social-responsibility.html) What is tyre? Review of literature What is Tyre? â€Å"A tyre is just black and round with hole in the middle. Actually, it’s a complex piece of high technology that is essential for the passenger safety and the efficient running of the vehicle. It’s a composite product. A tyre is a composite product that is, an inseparable assembly of materials with very different properties, whose manufacture demands great precision.†Ã‚   (http://www.michelin.co.uk/michelinuk/en/car-van-44/what-tyre/20070301111326.html) Structure of Tyre  ·Ã‚  Tread is that part of which comes into contact with road. It provides high grip, longer life durability  and protects carcass.  ·Ã‚  Steel belt also protects carcass and provides stiffness to tread.  ·Ã‚  The work Spiral layer contributes to high durability and manoeuvrability.  ·Ã‚  Shoulder being thickest part of the tyre it saves the carcass from outer shocks and damages.  ·Ã‚  Side wall being most flexible protect the carcass and provides comfortable ride to the driver.  ·Ã‚  Main body of the tyre is ply cord, it’s that which manages inflation pressures and endures load and road shocks.  ·Ã‚  Bead filler contributes in the high durability as well as manoeuvrability.  ·Ã‚  A bead wire is that part which hold tyre on rim.  ·Ã‚  Heat generated due abrasion of bead and rim flange id protected by chafer. NOTE: Construction of tyre may vary with size and pattern. (http://www.bridgestone.co.in/tyre/tyreknowledge/radialtyre.asp) Maintenance of tyre Maintenance of tyres is very essential to obtain the best performance. Following steps should be followed for proper maintenance of tyres-: Proper tyre mounting and de-mounting  ·Ã‚  New tube should be used with new tyre.  ·Ã‚  It should be kept in mind that tyre and tube are of same brand.  ·Ã‚  Combination of tyre and rim should always be correct.  ·Ã‚  Rim should be dirt and rust free and no bend should be there on the rim.  ·Ã‚  It should check that rim valve is smooth and round.  ·Ã‚  Before the tube is placed in the tyre, it should be cleaned the properly.  ·Ã‚  Mounting machines should used as much as possible and use of hammers and chisel should be avoided.  ·Ã‚  Ensure that before mounting and de-mounting tyre beads are lubricated.  ·Ã‚  Before inflating the tyre, ensure that tyre beads are seating correctly on rim or not. Tyre balancing An un-balanced tyre may cause vibration. So it is very important. Balancing  of tyre should be done under following circumstances-:  ·Ã‚  When vehicle covers 5000 Km  ·Ã‚  If vehicle is coming across any vibration  ·Ã‚  Mounting/de-mounting Tyre rotation Tyres must be rotated if any defect is found or vehicle have covered the distance of 5000 Km. First tyre  rotation is very important as it sets stage for long and even for tyre wear. Wheel alignment  ·Ã‚  Proper wheel alignment should be maintained of the vehicle.  ·Ã‚  It should done when ever required or after every 5000 Km. Daily tyre check Every morning before starting the vehicle, tyres should be properly checked. If the damages are exposed in the tyre, it should be cha

Advising Boeing And Airbus On Foreign Exchange Risk Finance Essay

Advising Boeing And Airbus On Foreign Exchange Risk Finance Essay BOEING: Boeing is the worlds largest aerospace company. Being a leading manufacturer of commercial jetliners, it is a top US exporter. It provides tailored services that include commercial and military aircraft, satellites, weapons, electronic and defense systems, launch systems, advanced information and communication systems. (Boeing, 2010). The company has it corporate offices in Chicago and also employs more than 159,000 people across the United States and in 70 countries, also has nearly 12000 commercial jetliners, in service worldwide, which is roughly 75 percent of the world fleet. (Boeing, 2010). AIRBUS: Airbus is a leading aircraft manufacturer owned by European Aeronautic Defense and Space Company (EADs), a global leader in aerospace defense and related services. Having its headquarters in Toulouse, France, it has fully owned subsidiaries in the United States, China, Japan and Middle East. It has it spare part centers in Hamburg, Frankfurt, Washington, Beijing and Singapore, training centers in Toulouse, Miami, Hamburg, and Beijing (Airbus, 2011). The company has 150 field service offices around the world and employs a total work force of 119,000 and has presence on every continent (Airbus, 2011). The major competitor of Airbus is Boeing Company. FOREIGN EXCHANGE RISK: Foreign exchange risk is defined as the risk that an investor will have to close out a long or short position, in a foreign currency at a loss due to an adverse movement in exchange rates. It is also known as currency risk or exchange-rate risk. (Investopedia, 2010). Simply put it is the effect that fluctuations in foreign currencies or exchange rates that affect the business entity. It is evident that large corporations like Boeing and Airbus that have operations in many countries are exposed to foreign exchange risks. It mainly arises due to difference in the currencies in which the company bears its operating or production costs and the currency in which the company receives payments from its clients. Boeing being a US company, it reports its financial transactions in US dollars. The input output is priced in US dollar which is a globally accepted currency. So even if it does trading in other countries, it receives payments in US dollars. Hence it is exposed to low forex risk. Airbus being a French company, it reports its transactions in Euros. Input or output is been priced in Euro in the domestic market, while in the world market is been priced in dollar which is globally acceptable currency and this exposes the company to high forex risk because Euro is not a global currency. We summarize it through following table: Company Currency of Costs Currency of Revenue Match/Mismatch Boeing US Dollar US Dollar Match between currencies. Airbus Euros US Dollar (assume 60%) Euros (assume 25%) Others (assume 15%) Mismatch of currencies. TYPES OF EXPOSURES: TRANSACTION EXPOSURE: Transaction exposure measures changes in the value of financial obligations incurred before a change in exchange rates but to be settled after the change.(Hagelin, 2003). It is the risk of changes in exchange rates between the time that a good is sold and the time that payment is received in foreign currency. For Airbus: As explained above the currency costs of Airbus are in Euros while cost of revenues is mostly in US dollars and some in Euros. This mismatch is clear from the annual report of the company according to which the operations of the group are mainly concentrated in different countries such as China, United States, India and Middle East; hence the payments are done in US dollars. This explains that Airbus has a high transaction exposure towards US dollar. Any fluctuations in the rate of US dollar against the Euro would affect the profit margin of the group. The long term contracts that must be honored at future rates are the other causes of transaction risk to the Euro. Though sometime the profits are being locked in by using long term contracts for e.g. for spare parts, there is an opportunity cost involves as the value of Euro or the price of commodities may increase. (Chester Chronicle, 2008) For Boeing: The cost of revenues as well as production, are denoted in US Dollars. Hence there is a perfect match. So even if the company has operations in many parts of the world such as Australia, Canada, China, India, Italy, Japan, Russia, and UK, the transaction exposure is less. Even if there is dissimilarity in the currency when Boeing sells its product to the different countries, the value is adjusted depending upon the countrys currency. The exposure arises due to variation in the currency rate, mainly of US dollar with other currencies. The danger here would be that the currency of the other country may strengthen or weaken to the corresponding US dollar. (Kascey, 2011). Consider the USD depreciates by 30%. The US currency would be under-valued, so this would lessen the profit margin of Boeing from payments received. But it would also reduce its cost of production. Thus this would hugely benefit for Boeing. On the other hand it would be very problematic for Airbus, as it would affect only the revenues and not the production costs. The decreased profits would cause a huge problem for Airbus. However, if USD value appreciates 30%, it would be of tremendous benefit to Airbus as the profits would be enhanced because of overvalued US dollars. Boeing would have to face the problems of increased cost of production but they would be backed off by the fact that payments would also be received in appreciated currency. TRANSLATION EXPOSURE: It is the risk that when the results of foreign subsidiaries are consolidated into the parents currency, translational gains or losses will result between reporting dates. The effects of translation risk are normally seen in the income statement and balance sheet. For Airbus: It deals mainly in aerospace, defense and commercial services. The Airbus commercial contributes 59% to the Companys revenue in 2009. (Airbus Annual report, 2009) The Company has a huge translation exposure, owing to the fact that it reports its earning in Euros. Transactions of its foreign subsidiaries, in foreign currencies other than the Euro are translated into Euro at the prevailing foreign exchange rate as at transaction date. It is mainly to the US Dollar as the trading in the industry and international markets is basically in US Dollar while the company reports its earnings in Euros. The translation risk of the company is evident in 2008 when the company had a decrease of 1% in revenue of à ¢Ã¢â‚¬Å¡Ã‚ ¬43.265 million due to an unfavorable impact of the US Dollars. Furthermore, in 2007, their chairman- Mr. Louis Gallois in his estimation said every Euro appreciation of 10 cents against the USD is a cost of à ¢Ã¢â‚¬Å¡Ã‚ ¬1B to the company based on the fact that Airbus costs are denominated in Euros while the major share of its revenues are in USD. Airbus also holds a substantial US Dollar denominated assets that are subjected to translation risk. (http://hedgecurrencyrisk.com/36/foreign-exchange-risk-can-be-huge-fortunately-it-can-be-managed/). For Boeing: It deals in commercial and military aircraft, satellites, weapons, electronic and defense systems, launch systems, performance based logistics and training. Of this, commercial airplanes contribute 49.8% of the companys revenues (Boeing Annual report, 2009). Boeing does not have any translational exposure. This is only because the companys trading in international markets is mainly in US Dollars and the company reports financial data in US Dollars only. ECONOMIC EXPOSURE: It is the change in the net present value of future cash flows of the firm as a result of unanticipated changes in real exchange rates. It gives an idea of the potential volatility of the company. For Airbus: Economic exposure of the company is substantially important due to the geographical locations of companys operations. The operating costs are mainly in the Euros and in some other currencies in small portions. The earnings are in US dollars in majority. So if the Euro depreciates by 30% against the USD, its operating costs would relatively go down and it would gain cost advantage. Also its reported profits in Euros would increase due to exchange rate. And if the Euro appreciates by 30% against the USD, it will be facing a huge economic exposure as the operating costs would increase substantially and the reported earnings in Euros would also be less. For Boeing: With 82% of the employees of the company based in America and remaining 18% employees in other locations like India, New Zealand etc, majority of operating costs are in US dollars. So Boeing Company would pay employees mainly in USD while a little portion in other currencies also. The Boeing Company receives its revenue in USD only. Because of this match, any increase or decrease in USD would accordingly increase or decrease both the operating costs as well as profits. Hence the exposure is small and easily manageable, as they are already in USD denomination. COMPARISON CHART: From the above explanation, the exposures of the 2 companies can be summarized by the following table: Company Transaction Translation Economic Boeing Small Easy to manage Does not exist. Small but Manageable Airbus Big Very Difficult to manage High Difficult to manage. Huge. Very difficult to manage INTERNAL HEDGING: Internal hedging means using techniques available within the company or group to manage exchange rate risk. These techniques do not operate through the foreign exchange market and therefore they avoid associated costs. However, this does not mean they are costless. INTERNAL HEDGING TECHNIQUES: MATCHING RECEIVABLES AND PAYABLES: There is no problem if the receivables and payables are in the same currency. If the receivables and payables are in different currencies (mismatch) then there is a risk involved in it. (Joseph, 2000). Airbus operations in US would insulate its risks, as the cost of operations in USD is matched by payment in USD; gained from various services and selling various products in US itself. Fluctuations in other currencies will be negligible as the company will not have to pay operating costs in USD with Euro. In order to provide insulation towards risk in various other countries Airbus can obtain revenue in domestic currencies to pay operating costs in different currencies, payables and receivables for example. As a result of this economic risk can be minimized. (Joseph, 2000) However, this matching of receivables and payables will succeed only to a certain extent. As Airbus would have to borrow Euros with the currency received from other countries in order to bear the operating costs in its own parent company- France. In case of Boeing, this is not required as the company already has a perfect match between the currencies of its trade receivables and payables. CENTRALIZED AND DECENTRALIZED TREASURY FUNCTION (MULTILATERAL NETTING): Airbus with its centralized treasury function utilizes multilateral netting, which is one of the forms of internal hedging against foreign exchange exposure, in order to reduce risk. Multilateral netting is found commonly in Enterprise Wide Risk Management (EWRM) where the parent companys subsidiaries would report the forecasted payments and receipts in the foreign currencies and estimated current exposures to them. After taking internal hedging into account the central treasury calculates the net exposure of the company towards each currency. And it makes use of external hedging to hedge residual exposures. In order to have exchange controls as well as clear understanding of taxation in their respective countries; multilateral netting requires subsidiaries of the group to have a standardized budget reporting periods. The savings gained through the implementation of EWRM information system are also important and are enough for the cost to offset. (Aucoin, 1990). The main advantage of EWRM also includes reducing the capital costs by managing the volatility of earnings. This is made possible through internal rate risk and external hedge of dangerous exposures towards foreign exchange. ERM maximizes the portfolio effect and even helps organizations to exploit natural hedges as stated in capital asset pricing model. (Aucoin, 1990). Hence multilateral netting is applicable to Boeing. As multilateral netting is most commonly found in EWRM, by managing the volatility of earnings it reduces the capital costs. Thereby the risk of Boeing is also reduced. CURRENCY OF INVOICING: The choice of currency which international trade is invoiced is of high implication for Airbus and Boeing due to the nature of their products and services. In trying to avoid foreign exchange risks, both companies adopt currency of invoicing by choosing which currency to be used in international trade. The strategy would be helpful to both companies only when properly planned. Assume Boeing just got a contract with British airways to build five 747s and one is to be delivered each year for the next 5 years. We assume the rate to be 10 million per plane. If Boeing can negotiate and adjust the terms of the invoice, it can shift, share or diversify the currency risk involved in this transaction; which would be an added advantage to the company. To transfer the risk, Boeing can invoice the transaction in USD, then it has eliminated currency risk for itself, however, it has shifted it to British Airways. Assume $ =$1.80, then British Airways has an $18 million account payables and Boeing has an $18 million account receivables. To share the currency risk between both companies, British Airways can share the risk by invoicing 50% of the transaction in USD and the other 50% in British Pound (BP), i.e. $7.5m + £5m for each planes. The risk can even also be reduced by diversification through the payment of the transaction in various currencies based on the negotiation between the two companies. By so doing, Boeing has managed the currency risk. Airbus in similar situation can do the same but this time the currency involved will be Euro and British Pounds or several other currencies in case of diversification. (http://spruce.flint.umich.edu/~mjperry/466-13.htm). ASSET AND LIABILITY MANAGEMENT: Asset and liability management (ALM) is basically a technique of risk management designed so as to earn an adequate return while maintaining a comfortable surplus of assets beyond liabilities. Boeing and Airbus do use this risk management technique to address foreign exchange risk and even operational risk and it also includes hedging where they can hedge against movements in fuel prices. Boeing and Airbus can manage their asset and liability in such a way as to: Increase their overall earnings Ensure efficient use of their capital and assets Manage the associated risk in a cost effective way. (http://www.investorwords.com/285/asset_liability_management.html). LEADING AND LAGGING: Leading is an internal hedging technique that is the acceleration of payment of companys obligation (e.g., payment to suppliers) before the due date while lagging, also internal hedging techniques, is the delay of payment of a companys obligation past its due date. (http://www.angelfire.com/ca/finrisk/Leading.html) For example, when Airbus or Boeing expects the currency (Euro) or (USD) respectively to appreciate in value, they may accelerate (leading) this obliged payment and realize the payment before the currency appreciates. In the same manner, when the value of the currency is expected to decrease in value, they may delay (lagging) payments so as not to make a loss in the transaction. (Victor P and Yann S, 2003). CONCLUSION: In conclusion, we say that Foreign Exchange Risks depend upon the currency of costs and currency of revenues. Any difference within them is going to expose the company to Forex risks. The Forex risk that BOEING is exposed to is less mainly owing to the match between its input and output pricing currencies. While AIRBUS is exposed to huge risks as there is variation in the currencies of its costs and revenues. Also BOEING has Maintenance Contracts with companies and contracts with its Government to supply Military Planes due to which its risks have a backup from their Government in case of Financial Crisis. However AIRBUS doesnt have any such backing from its Government. This coupled with the high risks that it is exposed to; pose a grave threat for the company in case of financial crisis. The Internal Hedging mentioned above though useful for the companies are subjected to their effective and timely. And Airbus would be better naturally hedged against the risks by converting to repor t its financial transactions in US dollars than Euros.