Organizational Forms Essay

There are several types of organizational forms that a business can choose from. Each form presents pros and cons that may or may not be suitable for a particular business. This report will review characteristics such as: liability, income taxes, longevity or continuity, control, profit retention, location, convenience and burden for each business form and how they differentiate from the different types of organization forms. Sole proprietorship A sole proprietorship is the most common business form. A business is a sole proprietorship if it is not incorporated, meaning that a separate legal entity is not created for it. An advantage of forming a sole proprietorship is that it is the easiest and least expensive business form. a.Liability: A sole proprietorship does not excuse the owner from personal liability. If the business fails, the owner is responsible to the creditors and may lose personal assets. b.Income Taxes: The profits and losses of the business go through the owners’ personal tax return. This can positively or negatively affect the owner depending on what the profit and losses of the business are and what other sources of income the owner may have. c.Longevity or continuity: If the owner dies the company cannot continue on. If the owner decides to leave the company, then the company will also cease to exist. d.Control: In a sole proprietorship the owner has full control of the business. e.Profit retention: The owner receives all profits in a sole proprietorship. f.Location: When a business is a sole proprietorship the owner can move the business to any location. The only fee may be if changing states or county and the business is operating under a trade name, then the owner will have to pay the relatively small fee to operate as a DBA (â€Å"Doing Business As†). g.Convenience or burden: There are not any extra burdens when operating as a sole proprietorship. The owner does not have to meet any special reporting or regulatory requirements. There are not any special tax requirements or restrictions. The business profit and losses are filed with the owner’s regular tax return. General partnership A general partnership is between two or more owners of a business that is not incorporated. a.Liability: Each partner is held personally liable for the debts of the business regard less of fault. b.Income Taxes: Taxes are reported on each partner’s personal income tax return, so any profits made by the company are treated separately from the individuals’ income, but included. c.Longevity or continuity of the organization: A general partnership lacks continuity. If a partner leaves and his or her shares cannot be bought by the remaining partner, then the business must close. If a partner dies, their heir can be paid for the value of their share of partnership, but cannot continue with business. d.Control: In a partnership control is equal between all the partners. This can be difficult when a company has many partners or partners that don’t know each other. If a change is made without consulting with the other partners that can cause friction between the partners, so it may be best to include all partners in all decisions. e.Profit Retention: Profit is distributed equally between all partners and so is any loss. f.Location: A general partnership is fairly easy to setup and move. There are not any special forms that need to be filed with the state or county to form a general partnership. There only has to be at least two people to make up the partnership. g.Convenience or burden: Since there are not any special filings that need to be done for a general partnership, it is very convenient. Limited Partnership A limited partnership is partnership that does not hold the partners personally liable for the business debts. a.Liability: Limited partners are not held personally liable for the business debts. b.Income Taxes: All profits and losses are passed through each partners’ individual income tax return. The company does not pay taxes. c.Longevity or Continuity: Limited partners can freely enter and leave the company. The company can continue if a limited partner leaves. d.Control: In a limited partnership there are limited partners and general partners. The general partners manage the partnership. e.Profit Retention: Profits are distributed to the partners based on their contribution and pass through to the partners, who in turn report the profits on their individual tax return and pay taxes at their individual rate. f.Location: When a LLP is formed or if it moves, then it must comply with state filing requirements. A LLP must file a Certificate of Limited Partnership with the appropriate state agency. g.Convenience or burden: A LLP can be convenient because it attract capital easily, it offers limited liability to partners, easy transferability of partnership, and pass-through taxation. C-corporation A C- corporation or a â€Å"privately held corporation† is a company whose stock is not publicly traded. a.Liability: A business owner is not personally liable for the company debts and is protected from lawsuits and judgments against the business. b.Income Taxes: C-corporations are double taxed. The IRS taxes the company profits and tax any dividends paid to shareholders. c.Longevity or Continuity: Even if the owner leaves or dies, the C-corporation being a separate entity can continue to go on. d.Control: Management is shared between the shareholders. e.Profit Retention: Profits are usually kept within the company and not distributed to shareholders. f.Location: A C-corporation must follow state filing requirements in each state that it wishes to setup in. This can be very costly. g.Convenience or burden: An advantage of a C-Corporation is that it provides the best protection for the owner against the company debts. A disadvantage is that it can be costly to establish. S-corporation S-corporations are a separate entity from the owner. It offers the owner limited liability, but the tax structure benefit of a partnership. a.Liability: The owner an S-corporation is not held personally liable for any debts or judgments incurred by the company. b.Income Taxes: In an S-corporation, the profits and losses of the company are passed through to the owners and shareholders and reported on their personal income tax returns and taxed at their individual rates. The company itself is not taxed. c.Longevity or continuity: Like a C-corporation an S-corporation can continue on, if the owner leaves or dies. d.Control: A board of directors manages the company through officers. e.Profit Retention: Generally in an S-corporation the profits are passed on to the shareholders. f.Location: An S-corporation must follow state filing requirements in any state that it wishes to setup in. g.Convenience or burden: An S-corporation can be convenient, because it provides the owner and shareholders protection from company debt and they save on paying taxes on profit, but it can be costly in setting up. Limited Liability Company A Limited Liability Company is similar to an S-corporation in that it offers the limited liability of a corporation, but the tax structure benefit of a partnership. a.Liability: Owners and shareholders are protected from personal liability for the business debts and judgments. b.Income Taxes: Profits and losses are passed through to the shareholders and filed on their individual income tax returns. c.Longevity and continuity: An LLC can continue if a member leaves, but the LLC must pay the member the value of their interest. d.Control: An LLC is managed by its’ members. e.Profit Retention: Profits are passed on to the members. f.Location: A LLC must follow state filing requirements for any state it wishes to setup in. g.Convenience or burden: LLC offer a very flexible structure. It also has no limitations on the number and kind of owners. It can be very expensive to form and because it is so new, it can be more complex. Bibliography Book: Beatty, J. & Samuelson, S. (2007). Business Law and the Legal Environment: Standard Edition, 4e. Mason, OH: Rob Dewey Web site: Perez, W. (2009). Protect Your Business Profits by Incorporating. About.com. Retrieved March 20, 2009, from http://taxes.about.com/od/taxplanning/a/incorporating.htm Corey Pierce, J. (2002-2004). Business Startup: Where to Begin & How to Grow. Businessfinance.com. Retrieved March 22, 2009, from http://www.businessfinance.com/books/StartABusiness/StartABusinessWorkbookTOC.htm PART B interoffice memorandum to:Owner subject: Business organization date:8/10/2013 There are many different types of business forms. After reviewing them all, I have come to the conclusion that an S corporation will be the most beneficial to you company. An S-corporation is a separate legal entity and protects the owner and shareholders from personal liability and offers benefits with its tax structure. This memo will address issues that are important to you and the advantages provided to you by forming an S-corporation. You expressed concern regarding your personal liability and whether or not if the company was to be sued- you did not want to possibly lose all of your personal assets. With an S-corporation you are protected from losing your personal assets if a company is sued for negligence by an employee or subcontractor. If the company were to default on debts, your personal assets are protected from creditors. Funding will also be fairly easy to obtain with an S-corporation. With an S-corporation, you will be able to sell stock in the company to increase capital assets to help with you expanding. You will be able to sell as much or as little of your companies’ stock as you wish, once a stock value is determined. An advantage to selling you company’s stock beside the increase in capital is that you are also able to retain control of the company when issuing stock. The profit that your company earns will be distributed to the shareholders, but with an S-corporation, shareholders are only allocated the profit and losses equal to the amount of their investment. The profits and losses are passed through to each shareholder and filed on their individual income tax returns. The company itself is not taxed. Also, with an S-corporation, if you were to pass away, the company would have continuity. The company would not have to dissolve and you. The stock that you own in the company can be transferred to an heir or transferred by the sale of all or a portion of the stock. Based on these findings, I recommend you to form an S-corporation for your company.

Marketing Is Called Delivery of Standard of Living Essay

Standard Marketing Marketing is one of the terms in academia that does not have one commonly agreed upon definition. Even after a better part of a century the debate continues. In a nutshell it consists of the social and managerial processes by which products (goods or services) and value are exchanged in order to fulfill the needs and wants of individuals or groups. Although many people seem to think that â€Å"marketing† and â€Å"advertising† are synonymous, they are not. Advertising is simply one of the many processes that together constitute marketing Marketing, as suggested by the American Marketing Association, is â€Å"an organizational function and a set of processes for creating, communicating and delivering value to customers and for managing customer relationships in ways that benefit the organization and its stakeholders†. [1] Another definition, perhaps simpler and more universal, is this: â€Å"Marketing is the ongoing process of moving people closer to making a decision to purchase, use, follow†¦ or conform to someone else’s products, services or values. Simply, if it doesn’t facilitate a â€Å"sale† then it’s not marketing. â€Å"[2] Philip Kotler in his earlier books defines as: â€Å"Marketing is human activity directed at satisfying needs and wants through exchange processes†. Add to Kotler’s and Norris’ definitions, a response from the Chartered Institute of Marketing (CIM) [3]. The association’s definition claims marketing to be the â€Å"management process of anticipating, identifying and satisfying customer requirements profitably†. Thus, operative marketing involves the processes of market research, new product development, product life cycle management, pricing, channel management as well as promotion. Marketing-â€Å"taking actions to define, create, grow, develop, maintain, defend and own markets†. An approach to business that seeks to identify, anticipate and satisfy customers needs. Al Ries and Jack Trout defined marketing as simply â€Å"war† between competitors, however this is clearly absurd – ‘Ali v Frazier’ is not marketing†¦ however the publicity and hyping of the event for commercial purposes is. It was the era of the clean-cut figure in a smart suit, the glad hander salesman who could sell refrigerators to an Eskimo, capable of selling everything from used cars to Bibles. It was sometime in the late Forties that attention came to rest upon a number of inter related elements of the marketing task that seemed to act together to influence the offtake of a product or service. Neil Borden of Harvard coined the phrase â€Å"the elements of the Marketing Mix,† depicting the manager of the function as not a specialist in selling, distribution, or advertising but rather a blender of ingredients in the right proportions to suit the market, its time and place. Later Marketing got separated from the notion of selling, including three distinct elements: customer orientation, i. . beginning with the customer; integrating the whole organization taking a long-term point of view; and linking with the primary goals of the business i. e. a combination of growth, market share and profitability. Indeed some writers (Peter Ducker, Regis McKenna) hold that Marketing and Business are synonymous. A later and less comprehensive formulation came to be known as the 4Ps â €“ product, price, promotion and place. This has now become the universal standard as a teaching tool for any introductory course in the subject. This was a vast improvement over the confusion between selling and marketing. It firmly put the former as a part, but only one among many that together explain the success or failure of a product in appealing to customers. Marketing thus became the overarching strategic theme, higher in level of abstraction than the mere act of obtaining the order. The significance of advertising in the establishment of an assured customer base really took off only after the widespread availability of mass media, especially after the 1950s. This not only made competition more difficult but more expensive and affordable only by the large sector. Enter the era of brands and branding. The Brand Image and Personality school came next, mostly identified with the legendary David Ogilvy, who said the brand’s personality gave it â€Å"a first class ticket through life. † The purpose of advertising was to convey the essence of this personality, beyond merely conveying the consumer benefits to the user – and do it in a charming and cultured way (â€Å"People don’t buy from clowns . . . † â€Å"The consumer is not a moron. She is your wife . . . â€Å"). Stephen King – Director, J. Walter Thompson, London – acknowledged as the practitioner’s guru of Branding, stressed the need for all the elements of a brand’s make up – from name, packaging, design elements to the creative expression of the advertising – to hang together. They must be not only mutually consistent, but also reinforcing the strengths of one another, to create a totality greater than the sum of its parts. Though brands have been around a long time the attention to building them happened only after the Sixties. Some enlightened organizations were exceptions and the brand leadership of their famous names still stands, such as Marlboro, Lux, IBM, Gillette, Kodak, Johnson & Johnson and so on. Soon, however, the only distinguishing feature of brands became their distinctive flavour of advertising, particularly so in consumer products. After all what can you say about a car (mileage, power, styling, looks), detergent (washes whiter, brighter clothes, removes stains) soap (refreshes, fragrant) or toothpaste (sparkling teeth, healthy gums, fresh breath) that hasn’t been said before

Characteristics of myself

Characteristics of Myself Kerri Larson Organizational Behavior Southern Institute of Technology Personality can be defined by the characteristic patterns of thoughts, feelings and behaviors that â€Å"determine how an individual reacts to and interacts with others† (Nancy, Robbins, & Judge, 2014, p. 42). It is very important as it helps define what type of person you are. An individual's characteristics play a large role when it comes to understanding one another. These patterns make every individual unique and distinct from each other.When I think of personality, I think of it as someone's entire being including perception, learning and titivation. Inner awareness of self and person-situation interaction make up an individual's personality. When I think of my personality, I like to assume I can describe myself as sociable, motivated and ambitious. These characteristics I believe really were ingrained as core values in my life after working hard from such a young age. Having u nderstood the importance of personality, attitudes, values relating to motivation in the workplace, I reflected on my own personality and how it has affected me and the individuals work with.Growing up, my family wasn't wealthy. My parents aired extremely young and my sister and were born not too long after. I don't remember things in a negative way as a child, but after my parents divorced, things were different. We never had money to buy the toys wanted or go on the trips like my friends. I remember growing up thinking that my friends had what they wanted so why couldn't we. My parents both remarried a few years later and my step-parents were now permanently in the picture. Since my father moved away, my step-father ensured that we had discipline in our life.There were never enough chores to do and work to be done round the house. My step-father was teaching me work ethic at that age and had no idea how chores would shape the way I work today. It was my fourteenth birthday and as would have said at the time, I was â€Å"made† to look for a job before I could play with my friends. I did as I was told, and got a part time job working at a fast food restaurant. This was obviously not my dream job and after a couple of job changes, I worked full time throughout high school earning money to pay for things wanted.Of course I did not always make the best decisions, but I learned that nothing comes for free and that o have to work hard to get a head in life. When I look back at this, I don't see punishment but a form of discipline which has made me who I am today. Worked endless hours, two jobs at a time and even though wasn't making exponential amounts of money, I was supporting myself and doing the things that wanted. I remember thinking to myself that never wanted to live on the bare minimum. I didn't need the finest things in life, but comfortable living was something I couldn't live without.Although gained the value of a hard work ethic and discipline, I was yet to receive another life challenge that loud shape my attitudes and values. I was born in Slave Lake, Alberta on May 11, 1984. I was raised and continued to live in Slave Lake throughout my life. Remember the phone call clear as day from my mother. I was coming home from a beach holiday with my boyfriend at the time and I had heard the news that my aunt and uncle had lost their home to a wildfire near town. We had a long drive from Calgary the next day, so we decided to come home early.We arrived, unpacked and headed to the store to get food. There was threat that town could be under alert, but nothing had happened. We decided o go for lunch at Subway and then go home to pack a bag, just in case. I remember the truck radio on before we went inside stating â€Å"I repeat, we are not under evacuation notice†. We ordered our lunch and got back in the truck. There was no radio when we started the drive home. As we drove closer to our home, which was only a five minute dri ve away, the smoke got thicker and we noticed more and more cars evacuating the area.The wind had pickup for so much that the shingles were ripping off our roof like Evolve. The police arrived to our door at the same time as we arrived and stated we had eve minutes to evacuate and leave. The fire was going to hit town. On May 14th, 2011, evacuated my home and sat across the highway in a nearby parking lot watching my home being engulfed in flames. I arrived home at 1 :pm and was evacuated by 4:pm. I was 27 years old and my life at that moment changed forever. Three hundred and seventy eight homes burnt down including my parents. There was nothing left to salvage.I lost my job and broke up with my boyfriend of three years. Although my life was tested, I picked up my life, moved to Calgary and took a job with TACO Structures & Logistics. Darted in as a temporary entry-level position with a chance to stay on permanent. I worked hard for long hours, stayed motivated and showed the organ ization that I deserved to be there permanently. Within six months, I was asked to stay on and have been with them ever since. I learned not only that hard work pays off, but staying motivated and ambitious were also key factors to my new success.After almost four years and three promotions, am managing a small team in our Calgary office. I can honestly say, that even though the fire destroyed many lives, my life has done nothing but grow in a costive way. I see life differently and try not to take the little things for granted. I am more motivated to live a more positive life and ensure that I help others and my community as much as can. When I think how this has shaped my life, I am more motivated to succeed not only at work, but in life as well.Since I started working in Calgary, can admit that it hasn't been perfect. I have had much change in managers and team members and when you look for stability in your work environment, these constant changes make a huge impact. I was recen tly in a situation where I faced a situation where I isn't sure could work for my organization anymore. There are certain things need and look for when working and as time went on, these values Were being tested more and more. When I think Of what I need as an employee or even an individual, trust is probably the more important characteristic.My manager is the person should be able to trust with my work, comments, feedback and criticism. Was assigned to a large task by my manager which would be completed in a few weeks. At the end of the task, I was required to summarize any issues and work with departments on corrective actions. When it came down to summarizing with my manager, he hose to consult another employee who was not involved. I felt betrayed that my manager did not trust my judgment and decisions. Wasn't aware of how much trust and support meant to me and what the value of that meant as an individual. Also felt since I am a young professional, there was distrust based on t he fact that there was a generational difference between my manager and I. Research suggests that generational differences exist in the workplace among the Baby Boomers (born between the mid-sass and the mid-sass), the Generation Seers (born between the mid-sass and the late sass), and he Generation Yes (born between 1979 and 1994). (Nancy, Robbins, & Judge, 2014, p. 80) My manager was a baby boomer while am a Generation Y and was one of the only Gene. Y on our team. Let that since I was younger, was not trusted due to the lack of knowledge and understanding which made me feel weak and not respected. My negative emotions ultimately sabotaged how felt about myself and my work ethic. Negative emotions can led to a number of deviant workplace behaviors. Anyone who has spent much time in an organization realizes that people often engage in voluntary actions that elate established norms and threaten the organization, its members, or both. (Nancy, Robbins, & Judge, 2014, p. 58) Trust is i mportant.If you don't have trust, then how can anything else follow? The foundations of demodulating and leadership are built on trust. A few weeks went by and the disappointment turned to anger. I could no longer have displayed emotions, â€Å"those that the organization requires employees to show and considers appropriate in a given job† (Nancy, Robbins, & Judge, 2014, p. 55). My felt emotions, â€Å"an individual's actual emotions† (Nancy, Robbins, & Judge, 2014, p. 5), were surfacing and the office was becoming an unbearable place to be.I was so disappointed I had to talk to someone, which led me to a small room with human resources. The disappointment built from such a small Issue, that felt I could almost leave the organization which wasn't the most rational decision. We must have the ability to experience emotions to be rational. (Nancy, Robbins, & Judge, 2014, p. 56). The value of trust was so important to me, that felt could no longer work there or it would le ad from negative emotions to something worse. The key to good decision making is to employ tooth thinking and feeling in our decisions. Nancy, Robbins, & Judge, 2014, p. 56). After discussing my options and realizing that the choice of resigning was not the option for me, I decided to think positive and overcome the negative aspects of the scenario. What I also realized that this made me more motivated as an individual to prove that I was capable at completing and excelling in my career. I knew that was competent and hardworking and that one small issue was not going to deter me from proving to my manager and myself that was qualified to be there. I was taking a more proactive approach to my personality.People with a proactive personality identify opportunities, show initiatives, take action and persevere until meaningful change occurs. (Nancy, Robbins, & Judge, 2014, p. 52). In the end I was given the different opportunity to work for another leader. I used this opportunity and too k that motivation and was honest with my new manager. I spoke up about the values and motivation I was looking for in a leader and that if this was provided to me, I would provide the same. I took my negative emotions and transformed them into something positive.Because of this, I was also remoter to manage the team I worked in. Even though he was also another Baby Boomer, we both held the same opinion on trust and taking pride in your work. I used the opportunity to motivate my team when they felt discouraged and ensured that instead of mistrusting them, that they had the opportunity to show me as a leader, what they were capable of. I am not the perfect manager, but ensure that my team sees the importance of bringing themselves and values into their work and that each person brings something different to the table.Motivating them to see that everyone's opinion is important and how this makes a bigger impact in the workplace. It not only betters them, but betters our organization. When I think of the meaning of the values I've gained over the years, they have ultimately defined what person I am today. I maintain my integrity because I apply these values to my life in whatever situation I am in. Since an individual's effectiveness in the workplace often depends on his/her personality, attitudes and values, along with his/her motivation to succeed, it is important to understanding these characteristics of individuals.Considering these characteristics can be crucial or an organization to operate successfully. At the same time, it is essential that individuals understand the values associated with the organization in order to avoid any conflicting feelings toward the work they are employed to do. By recognizing and appreciating each others characteristics, values and behaviors, employees and the organizations they are part of, form a highly- beneficial symbolic relationship. Thus, it becomes imperative for employees to remain motivated and for organizations to ke ep them motivated.Recognizing the importance of personality, attitudes, values and motivations s something that everyone needs to do in life. I personally believe that people are tested and that this importance isn't realized at the same time in life. People face different external forces and life is never the same for everyone. Personalities are important to recognize as it strongly influences one's expectations, self-perceptions, values and attitudes. (Wisped). Understanding your own personality as well as others gives you the ability to communicate effectively and understand others better.When you have the ability to understand others personality as well as your own, you gain the ability to recognize what motivates them, what is and is not important to them and where attitudes exist. It is also important to understand the difference between personality and attitudes. Attitudes can change more frequently where personality is more deeply ingrained. In organizations, attitudes are i mportant because they affect job behavior. Employees may believe, for example, that supervisors, auditors, managers, and time-and- motion engineers are all conspiring to make them work harder for the same or less money.This may then lead to a negative attitude toward management hen an employee is asked to stay late and help on a special project. (Nancy, Robbins, & Judge, 2014, p. 88). Attitudes are our feelings towards certain ideas or issues. They become almost contagious and can be greatly influential among peers and co-workers. Our attitudes are the manifestation of our values and they are expressed through what we say or do and reflect a person's sense of right and wrong or what â€Å"ought† to be. Values tend to influence attitudes and behavior and are an integral part of every culture.With worldview and personality, they generate behavior. Being part of a ultra that shares a common core set of values creates expectations and predictability without which a culture would disintegrate and its members would lose their personal identity and sense of worth. Values tell people what is good, beneficial, important, useful, beautiful, desirable and constructive. They answer the question of why people do what they do. Integrity alongside values is equally important to the workplace.It gives individuals the ability to bring themselves and their personalities to the organization but stay to true the organizations values as well. Integrity, strong ethics and values are crucial o an organization's success not only because the individuals understand what is right and wrong is, but they practice this in all they do. Work ethics can be described as not only how someone feel about their job or career, but also how someone does his/her job or responsibilities. This involves attitude, behavior, respect and communication.When you reflect on the importance of personality, values and attitudes and how they contribute to motivation in the workplace, it is equally importan t to remember that they all have different influences on different motivational processes. Motivation is different for very individual as each person's preferences are different. Moreover, there are also external drivers of motivation. Those external drivers contribute to the level of the motivation of employees in terms of better performance within organizations. The core thing of motivation is to give people what they really want most from the work.The more the managers provide what they want, the more they can expect what they are looking for like productivity, quality, and services. A positive motivation philosophy and practice should improve productivity, quality, and service. Motivation helps people to achieve locals, to gain a positive perspective, to create the power to change, to build self-esteem and capability, to explore potentiality with creativity, to manage their own developments and their own abilities. When I consider my workplace and co-workers, I attempt to ensure that I bring my values and my personality to work every day.Of course I was not always like this and there were days when I am not so motivated and ambitious. As well when I consider all the external forces one experiences on a day to day basis, personality is always changing. Ironically my workplace offers a similar course o this course and I learned a little about organizational behavior prior to registering. One of the most interesting parts of the course was that I participated in a personality report and the results were not necessarily new or surprising, but realized how much my personality affects others.We took part in the DiSC Workplace model and had flying colors in dominance. I'm highly motivated, direct, result-orientated and focus on success and growth. Upon returning to work, I was adamant that one of my key co-workers take the same profile report. We used this opportunity to understand what each there's personality type was and what influenced and motivated each othe r. Even though we work so well together and have a great working relationship, it was still beneficial to understand what her priorities and influences were.I could better understand her as a person and become a more effective leader. The other interesting factor I learned was that I am very task/job driven. I am extremely motivated by personal success and job-related functions. I learned that need to ensure that I consider others and contribute more to how they are feeling and what personally motivates them. When focused on completely ark or a project, need to also consider that factors such as personality, work ethic, values, skillet and knowledge all contribute to the quality of work rather than deadlines, budget and resources.I feel now that even though this was such a small opportunity to participate and understand how complex personalities are, learned so much about howl really affect and influence others. Understand why it is important to recognize what my values are and how my personality is affects others. In conclusion, the key point is that personalities, attitudes and values all contribute to motivation in individuals n different ways. It is what is unique about us that define how these characteristics contribute and shape who we are as individuals.

Who in your life has been your biggest influence and why Scholarship Essay

Who in your life has been your biggest influence and why - Scholarship Essay Example He motivated me by reminding the real value of education by reminding me thus, â€Å"Dream of going to college is attainable if you put hard work to achieve.† Not only the words but also his deeds proved me what he said is true and genuine. As I am the eldest of 6 brothers, and having the responsibility of looking after them, naturally I thought I may not have the proper chances of pursuing my education. Fortunately, I was the first grandchild who had the chance to go to college and I have never been in trouble at school out of 12 years. I could also obtain A/B Honor roll during my education career with the unique support from my father. My father’s hardworking mentality after divorce to provide us the stable living situations is another factor that influenced me greatly. He goes to work 6 days a week to support all of us. The way he helped the neighbors and even the strangers in need has put a drive in me to help my fellowman whenever I can. Now I have realized that in fluence is the power to have an important effect on someone or something. And I feel the power in me through the magnificent influence of my father who has provided me a lot and made me what I am

How can colleges increase their minority students population Essay

How can colleges increase their minority students population - Essay Example Colleges such as University of Southern California, University of San Francisco and even Stanford University have gained many benefits from having a diverse population both in terms of students and faculty. However, it must be noted that, obtaining a high level of diversity is not an easy objective and a lot has to be done by many colleges before they can claim to have diversity as an advantage that the offer to their students. Diversity can be clearly understood as a competitive advantage since it allows students to experience the world as it would be in their real life work environment. As per the suggestions given by Sherman (1996), the experience of diversity can help in breaking any stereotypes that a person may have and this would help in improving not only the overall outlook of the student but also improve their chances of having better future encounters with individuals coming from diverse backgrounds. There are several strategies that can be recommended to colleges for increasing their level of diversity. The most practical advice in this case is given by Dr. Campbell (2006) who works with the NAMCE (National Action Council for Minorities in Engineering). She suggests that colleges should try and reach out to diverse populations rather than sit back and hope that diverse populations will seek them out. She also applauds the GE Foundation that funded the Math Excellence program which helped colleges get more diverse engineering students through financial education support and by creating connections between colleges and students. As suggested by Trumble and Overstreet (2006), such connections work in the corporate world quite affectively when it comes to retention and recruitment and there is no reason why they can not work in the education sector. These connections were formed when colleges brought students from a diverse background to the campus in order to help them understand why

Proposal for change Essay Example | Topics and Well Written Essays - 2000 words

Proposal for change - Essay Example The communication could be verbal or nonverbal like by the use of expressions or jesters etc. The discussion among the nurses and the patients is conducted usually in a very hectic atmosphere; both the patients and nurses are in an urgency as a result of which unwanted issues may arise. The directions are often delivered to the patients on the phones rather than face to face. In the cases of emergency the communication skills gain very high importance as the decision about the procedure has to be made immediately but sometimes the patient nurse interaction is delayed too much as a result of which serious consequences could be faced. In order to avoid the problems in communication some strategies have been discussed in this paper. One technique to attain this objective is by the use of strategies which are being used by other industries and have been very effective like team resource management. It is a training course which has been designed by the aviation business. It emphasizes on combined decision making and team oriented approaches. The most excellent patient care can be provided when the nurses are accessible at all times. By the use of equipments like background-assessment-recommendation (SBAR), it is guaranteed that the delivered messages are very clear and not ambiguous in any kind of stressful situation (Leonard, Graham & Bonacum, 2004).  U-nursing is also very effective in improving the patient nurse communication. The SWOT analysis is also given in the proposal. The above mentioned plans could be implemented easily. Some are not time consuming like changing the behavior and attitude of the nurses however some of them needs time like installation of wireless equipments. If the nurses lack the skills for good communication the above mentioned tasks becomes really difficult to handle. In order to deal with patients who have diverse cultural and ethnic backgrounds and having different levels of knowledge, communication becomes a big challenge to the h ealth care providers. Health care providers especially the nurses have always been very keen to advance the communication skills so that they can progress to better patients care services. In nursing, a heavy amount of information has to be provided and received in a narrow time period. In order to do this perfectly and smoothly the communication settings, history experiences and individual opinion of the people must be considered very deeply. So the communication enhancements mentioned above will prove to be very successful. From this study we have come to know that when you move toward alteration with a patient-centered attitude, the finest decisions are obvious. Table of Contents Executive summary 2 Introduction 4 Analysis of change needed 5 SWOT Analysis: 7 Strengths: 7 Weaknesses: 7 Opportunities: 8 Threats: 8 Plan of Action 8 Evaluation strategy 9 Conclusion 10 Bibliography 10 Connelly, L. M., Yoder, L. H. & Miner-Williams, D. (2003). A Qualitative Study of Charge Nurse Compet encies. MEDSURG Nursing, 12 (5), pp.298-306. 10 Introduction Communication means relocation of the information amongst the people. The nursing job involves continuous communication between the patients, their relatives and the nurses. The chances of miscommunication in this profession are very high which can lead to serious consequences.  For nurses it is really important that they should be aware of key communicating process and the height to

Does globalization threaten cultural diversity Essay

Does globalization threaten cultural diversity - Essay Example By the help of all the advancement and progress in the technology now anyone can travel a thousand miles in matter of hours and days. However Globalization is a very controversial topic, many economist don’t support the idea of globalization as it has many diverse affects on the economy. As many economist believe that Advances in communication and transportation technology, combined with free-market ideology, have given goods, services, and capital unprecedented mobility. And this can affect the local market of the country. It is also argued that globalization threatens cultural diversity by its promotion of an internationalized or corporate culture. Many cultures seem to be overly influenced by the most dominant cultures like American and Britain. The loss of cultural identities leads to the diminishing of such concepts as cultural diversity and multicultural environment. ... diversity by diminishing distinct cultural identities American Cultural Imperialism is the concept that strongly goes against the promotion of cultural diversity through globalization. The dominance of America on world economy and business market leads them to a place where their power of negotiation and economic stability influences the people as well as their beliefs and cultural priorities. The diverse population living in America, for instance, is under the influence of American culture, the freedom it brings, the dresses it allows and the social status it offers. Hence, smaller or less famous cultures are slowly and steadily transforming into an Americanized culture and the concept of cultural diversity diminishes. The swiftly increasing development pace of the globalization concept leads to several uncontrollable outcomes for the diverse cultural identities (Puledda 2000). The technological advancements, mass media and easy transportation give rise to a world where distances ca nnot place a boundary for people from reaching the foreign cultures, business markets and traditions. The people working abroad are even given chances to learn the language that is native to the country they moved to. Although it is a good move, it rejects the cultural diversity concept and rather snatches and transforms the distinct cultural identities of people. Globalization is bringing people together but it is also responsible for diminishing the uniqueness of other cultures. The marketing campaigns and rules of the companies trading in more than one country may not fulfill the cultural rules effectively due to unawareness or difficulty in managing different policies for each country. The unitary code of conduct for employees working under the name of a single brand may not be

British Empire Essay Example | Topics and Well Written Essays - 2000 words

British Empire - Essay Example The utilization of academic journals, timely books, academic web sites, and periodical articles, gives supporting evidence into this research to prove the validity of the statement that the British Empires construction was done to improve upon the British people's homeland, and living conditions, more so than any other socioeconomic factor emphasized. This statement does not hold the validity that the main idea of the construction of the British Empire does, which was to provide guaranteed sustenance, a secure home-land, safety for the citizens, and the promotion of socioeconomic growth. As Porter (2002) points out in his writing, "British expansion was a matter of prudent negotiation rather than thoughtless aggression," or even greed for that matter. This defines the building of the British Empire as a construction that was not done by means of war, but rather discussion amongst other public figures of countries to gain treaties that would allow for Britain to be able to develop and expand in a humane and civil manner. Furthermore, the idea that it was greed that compelled the Britons to expand seems highly unlikely and benign as Porter defines, through his writing, that there were notably times when Britain had no real interest in imperial expansion, even though it normally occurred at a later date through negotiated treaties ( 219). The main cause of this Nation building its empire was more centered on necessary strategies of protection, and the social, economic, and religious factors that were involved at the time, as is being emphasized. As has been stated, there existed multi-faceted reasons for the development of this Empire. The Briton's steadfast belief in imperialism, and the idea they had to civilize and bring the idea of Christianity to the whole world held its own place in the construction of the empire. The Briton's believed that by expanding and acquiring more land they would have better safety nets for refuge in case of attack. They also wanted to secure a safe area of land so that colonializations could develop and the people could feel safe. By doing this they believed it allowed them to have the freedom to follow their own religious following. In other words, expansion brought them a religious form of refuge from persecution by Puritans like Charles I. Not only did the Briton's feel expansion was extremely necessary to provide for religious sanctity at times, but they also realized that the growing population needed a good demographic area to settle for an extended period. These were all unselfish reas ons for the continuing construction of the British Empire's development and security. Furthermore, Britons were aware of the signs of animosity from neighboring countries that could pose a threat to the country's well being, and in this regard they had many defensive reasons as to why the construction of the Empire was indeed, a necessity. Their fear of Spain led them to expand into North American

Management high performance ip5 Essay Example | Topics and Well Written Essays - 250 words

Management high performance ip5 - Essay Example This is the second point that will be discussed in the meeting, which will take the form of explaining to the employees the demoralizing and demeaning effects of workplace hostilities on the employees (Simlin, 2006). The supervisor will explain the impact of the employee hostilities as a contributing factor to poor departmental performance, since the employees are demoralized by the hostility and made to feel unappreciated. This in turn lowers their enthusiasm and energy, making them less productive (Harold & Kumar, 2012). This is the third point that will be discussed by the supervisor, aimed at helping the employee understand the desired organizational values of the factory in relation to workplace ethics and cultural diversity. Such values make the factory employ workers from different religious and cultural background without discriminating (Rodriguez, 2006). The supervisor will explain the value of diversity within a workplace in enhancing productivity and performance. The supervisor will also explain the duty and responsibility of the employees to embrace the organizational values, and as such cease the hostilities (Simlin, 2006). Federal Communications Commission (FCC). (2009). Understanding Workplace Harassment: Workplace Harassment is a Form of Discrimination. Retrieved March 15, 2014 from

Managerial Decisions in Economic Terms Essay Example | Topics and Well Written Essays - 2000 words

Managerial Decisions in Economic Terms - Essay Example The project makes suitable assumptions, like, the present value of discounting, the number of miles that car intends to run and the charge involved in travelling the extra miles over and above the stipulated miles allowed in the lease contract. Finally, a comparison is made between the present values of the two alternatives. It discusses three situations. It finds the present value of the car purchase, present value of the car purchase using a loan and the present value of the lease along with purchasing option. The project seeks to find the best and the most cost effective alternative from the above three cases. This project tries to find out the basis of applying managerial decisions under different circumstances. In this case, decision has to be taken between the two alternatives of buying a car or leasing it. The best possible way is to compare the costs involved in both cases. The aim of the project is to find out the most cost effective method of transaction by calculating the present value of the discounted cash flow. Firstly, it discusses the advantages and disadvantages of leasing and owning a car and the costs involved in both cases. This project aims to help managers in making decisions between a lease and a purchase. An analysis is conducted under three given situations before a conclusion is drawn. It is not a simple method and involves a host of other factors like the number of miles that the buyer intends to travel, and the rates of interest prevailing at that time. The managerial decision of whether to lease or buy a car is of primary concern in this project. The project will act as the mouthpiece for a public school system which is to decide whether it would economical to lease a car or to buy it. Both have got their respective benefits and costs. The motive of the project is to detect which would be the most cost effective method. In order to come to a final decision, a comparison of costs needs to be done which will take into

Further Principles of Trusts Project Essay Example | Topics and Well Written Essays - 1250 words

Further Principles of Trusts Project - Essay Example The management of the amount has been left entirely to the discretion of the trustees, who by default, now have the power to invest the funds for the benefit of the entire trust of the deceased. Hence at the outset, the immediate dispersal of funds to the nephews and nieces is not a mandatory requirement on the part of the trustees, who have the power to invest it as they see fit. IT must be clarified straight away, that the trust fund for the nephews and nieces does not entitle them to immediately be entitled to all of the proceeds, hence dispersal of the total amount of 500,000 pounds is out of the question. It must also be noted that among the nephews and nieces of Alan Benson, the deceased, only two are above the age of 18. The Trustees now have the power to invest trust funds by default and they have the option to invest the entire capital of 500,000 pounds for the benefit of all the beneficiaries, i.e, the four children, until all of them reach the age of eighteen. Since the Trustees will be expected to invest the funds or manage them to the best of their ability for the benefit of those named as beneficiaries of the trust, there is a pre-existing factor working against the breaking up of the total trust amount into its four constituent parts of 125,000 pounds, which each child will be entitled to. By immediately disbursing the funds of the trust as requested in Tahir Hussain’s letter, the trustees run the risk of being accused of mismanaging the funds, especially if the proposed ventures, i.e, expansion of existing business and vacations trips, etc are not successful and res ult in a loss of monies, thereby contravening the goal of allocation of these funds for the benefit of those children. It is significant to note that no restriction has been imposed in the will on the trustees’ power of investment of the funds, which suggests that the original intent of the deceased may have been to ensure that the allocation of 500,000

Romanticism Movement Essay Example for Free

Romanticism Movement Essay Romanticism branched out of the age of humanism, and was an intellectual, literary, and mostly artistic movement that originated in Europe towards the end of the 18th century and at the beginning of the 19th century and was a revolt against the Neoclassicism which was popular in the previous centuries due to the Age of Enlightenment. The artistic movement rebelled against theoretical tradition. Many artists that participated in this movement drew inspiration from deep, emotional matters which they used as a foundation or starting point for many of their subjects and distinguished artistic styles. In shorter terms, the points that were emphasized in Romanticism were freedom, imagination, and of course emotion. Romanticism is therefore very much related to Realism in certain aspects. A German poet by the name of Friedrich Schlegel was credited for coining the term â€Å"romantic† which was used to describe literature in an â€Å"emotional matter in an imaginative form.† At the beginning of the 19th century, countries were experiencing, and going through many difficulties. Napoleon had ravaged many nations and had soaked their fields with much bloodshed. Europe however, was getting it the worst. The people living in Europe were dealing with crisis after crisis. Many were feeling lost, helpless, and generally miserable. There was absolutely no peace, and no order. It was most definitely a time for mourning and anguish. So at this point the Romanticism movement undoubtedly grew, as more people and artists focused on individualism, as opposed to life in society. Because many were individualists, they would obviously spend much time in the wilderness admiring nature then living in urban areas, thus nature was loved and worshipped by many romanticists. One can only imagine the various types of artwork that was produced because of this particular movement. There were more prominent figures or individuals that particularly stood out in the romantically artistic movement. One of these figures was a German Romantic landscape painter by the name of Caspar David Friedrich. He was born on September 5th 1774, and was known for his symbolic landscapes, and an overwhelming sense of loneliness in his paintings. His landscapes barely or rarely depicted sunlight, and rather they portrayed dense fog, mist or dawn. As he lost more friends and family to death, he would suffer depressive episodes. These episodes noticeably shifted the themes in his artwork, as he began to use graveyards, ruins, vultures and owls in many of his paintings, which symbolized and hinted at a looming, impending death. Friedrich is considered by many to be the â€Å"Edgar-Allen Poe† of art. Another pioneer of the Romantic movement was a influential French artist, painter, and lithographer know as Jean-Louis Andre Theodore Gericault. Initially, Gericault studied Neoclassicism at the Musee du Louvre but eventually found that his capacity to learn, or grow on this subject was lacking, so he left. Many of his paintings feature horses in them because he spent much time in the stables in Versailles studying the action and anatomy of horses. In is paintings he displayed graceful defeat, savagery, heroism, and of course animal magnificence. One of his most notable paintings is titled, â€Å"The Raft of the Medusa.† The painting reflected a French shipwreck which was called â€Å"Meduse,† of which its passengers were left to die by the ship’s captain. These however are just some of the distinguished artists that held a prominent role in the Romanticism movement. Though the American Revolution had taken place, and had their own Romanticism movement, France had been the hot zone when it came to this movement. France had been going through a revolution through out the time the movement was being advertised. As a matter of fact, the revolution seemed to be fueling the movement. This is evident in many pieces of Romantic literature, in which there are signs of effects caused by revolution. It is actually hinted that Romanticism in France was in fact the product of the effects of the revolution. The revolution inspired many Romantic writers, many of which were British, such as Percy Shelley, Lord Byron,William Wordsworth, Samuel Taylor Coleridge and many others, as they approved of the revolution and shared the same views regarding it. And though they all praised the revolution, they each had their own unique ideas regarding it, which can be studied or examined through their work. Furthermore, the movement had its own ideas in general about the overall revolution. When the revolt turned the entire nation in a new direction, many people used the freedom they had acquired to implement just laws to live and abide by, and they also had the freedom to think for themselves without having to be influenced by the society. Before the revolution, the work of artists, poets and writers chiefly dwelled on those who were high in social classes and religious leaderships. However that would soon change. Strengthened and encouraged by the revolution many writers and artists that had been holding in the will to express themselves were finally given the chance to under the new laws implemented by the population. Romanticism was a crucial movement during the French Revolution, as it helped many cope with the harsh lives they were living, and strike inspiration into the hearts of fellow Romantic pioneers. This movement also paved the way for Realism and as both discussed the depressive realities of life. â€Å"Some people call me sick and twisted. I feel that I’m neither; I am instead a Romantic.† -Kenzie Western Citations: http://www.goodreads.com/quotes/tag/romanticism http://www.uh.edu/engines/romanticism/introduction.html http://www.artchive.com/artchive/G/gericault.html http://www2.roguecc.edu/art/wpeterson/art206/romantic.html

Forming a regional trade agreement advantages and disadvantages

Forming a regional trade agreement advantages and disadvantages Since World Trade Organization (WTO) was established in 1995, the number of its membership has increased to 153 countries by 2010. Recently, a phenomenon is observed. As countries pursue trade liberalization under the multilateral standard of WTO, more and more regional economic integration are conducted. Many members in WTO sign new regional trading Arrangements (RTAs) to deepen each regional trade reaction. Because positions and demand for different trade issue are often diverse to the regional member countries, the negotiations become more and more difficult. Consequently, the trend of bilateral and multilateral free trade agreement rises gradually. Besides, due to the bitter competition in the global market, countries also exert to obtain trade partners. Countries found thorough forming regional trade agreements could be an easy way to enhance trade reaction with their close trade partners. According to RTA database offered by WTO (2010), 371 RTAs related to WTO have been announc ed and 193 of them were in force by 31 July 2010Figure 1 shows the evolution of the average number of RTA partners for the current members of the World Trade Organization (WTO): the average WTO member now has agreements with more than 15 countries. Therefore, regional economic integration has become one of the main trends in the present global economic development. In recent years, the global economic system expands gradually by the reaction between the forces of regionalization and globalization. The following offer a general historical data of regional integrations. First, the trend of Regional Integration can be traced back to the 1950s. The 1950s saw European Communities (EC), the most important and representative regional integration case, was established. Then in the 1960s, numerous regional integrations were conducted by Africa, Latin America and other developing countries. Continually, United State is considered to be the main thrust of regional economic cooperation during the mid 1980s and the1990s. During this period, except for lasting the free trade agreement with Canada and Israel, also United State promoted to arrange North American Free Trade Agreement (NAFTA) and Free Trade Area of the Americas (FTAA). Meanwhile, In Europe, the target of expansion and cross-regional cooperation are approached by European Union (EU). On the side of the expansion, Greece, Spain and Portugal were subsumed in the 1980s and the steps were followed by Sweden, Finland and Austria during the 1990s. Then, in the 2000s, Czech Republic and other eleven countr ies also attended European Union and four more countries, for instance, Turkey, are candidate to join. A growth in membership in European Union is expected. On the other hand, the aspect of cross-regional economic integration is also approached. To ensure the market share and position in America area, European Union urged to conduct free trade agreements with Mexico and MERCOSUR. As a result, the free trade agreement was announced with Mexico in 2000 and became the first free trade agreement conducted with Latin American Countries. Compared with Europe and America area, it is entirely reasonable to make the analogy in East Asia. One of the representative regional integrations in East Asia is ASEAN. ASEAN, namely Association of South East Asian Nations, was established in 1967, including Indonesia, Malaysia, Philippines, Singapore and Thailand five countries. The original motivation of ASEAN is to prevent the spread of communism and to improve the regional trade reaction and cooperation. Since its establishment, there has been 40 year of its history. On 8 Jan 1984, the membership increased to six with the join of Brunei, and these six countries are called the founding members of ASEAN. Then they were followed by Vietnam, Laos, Myanmar and Cambodia in the 1990s so that current membership expands to 10 countries. The communism prevailed when the time ASEAN was formed. As a consequence, the political purpose was more than economic one in that period so there was no free trade agreement until 1992 the founding membe rs signed ASEAN Free Trade Agreement (AFTA). A gradually tariff reduction in member countries, which is called Common Effective Preferential Tariff (CEPT), was planed to be achieved before 2008. As in 1999 the thirteenth meeting of the ASEAN Free Trade Area decided CEPT should be achieved earlier and decided non-tariff among members instead of the initial target. Then AFTA was in force with the founding countries of ASEAN in 2003 and non-tariff in all members was planed to be reached by 2015. Above is the development of ASEAN free trade agreement. Next, a difficult position of Taiwan will be introduced. Asian financial Crisis happened in 1997 and conduced the willingness of East Asia countries to cooperate. Since 1999, those important trade partners of Taiwan in Asia have committed to access the forming of free trade agreement. For example, Japan and Singapore signed Japan-Singapore in 2002 and in force in the same year. Also after AFTA was conducted, China, South Korea and Japan, three large economy countries in East Asia, had pursued to sign FTAs with ASEAN. In December 1999, ASEAN announced to impose cooperation in their economic with China, Japan, and South Korea, which is called ASEAN+3. According to Picture I, it reveals the ASEAN+3 member countries on the world map: the dark ink represents the members and, comparatively, Taiwan is circled to be pointed out. An interesting discovery is found: although being a country located in East Asia, Taiwan is excluded from ASE AN+3. Due to some political problem, Taiwan has just signed 5 free trade agreements with other countries and none of them are Asia countries. Table 1 see the export trade amount of Taiwan with ASEAN+3 countries. The export amount occupied 66% of total Taiwan export so that if ASEAN+3 non-tariff target is achieved (in fact ASEAN and China free trade agreement has progressed on 1 Jan 2010), Taiwan would face a difficult trade position. Therefore, to avoid being isolated away by other trade partners and to deepen the cooperation with them, accessing advantages and disadvantages of forming a regional trade agreement become necessary. To analyze those advantages and disadvantages of forming a RTA, an understanding in regional trade agreements is important. Also, to know whether any limit exist to forming a RTA, a good way is to review the international trade criteria given by GATT and WTO. Hence, in the discussion, a two-phase study was designed to explore the advantages and disadvantages of forming regional trade agreements. First of all, there are three branches in the former phase. In the first branch, to realize what regional trade agreement is, the paper examines the theories of regionalism and all types of regional economics integrations. It is worthy to understand regional trade agreement from its original intention and distinguish those differences. Second branch provides an overview of the organizations, which aim for improving international trade. For example, a comparison between World Trade Organization, Asia-Pacific Economic Cooperation (APEC), Europe Union and Association of Southeast Asian Nations ( ASEAN) will be made to clarify their objectives of the establishment. We will see a conflict between the globalization and the regionalization. Last branch reveals two forces which against each others, namely trade creation and trade diversion. These two forces determine the gain or loss of a regional economic integration. In the second part of the study, an analysis of the advantages and disadvantages will be offered, based on the knowledge provided in the first part of the studies. The remainder of this paper is divided into four sections. The next section of the article is a review of the literature; addressing both empirical and theoretical aspects of regionalism, worldwide trade organizations, trade creation and trade diversion. Section III describes the development of regionalism and provides empirical economic integration to support that. Using the background provided in the section III, section IV analyses the advantages and disadvantages of forming regional trade agreement. In the end of the paper, section V concludes. Trade Creation and Trade Diversion Trade economists have being going the effort on whether the formation of a regional trade agreement will lead member countries to be better off. A common concept to analyze gain or loss of a RTA was given by Viner. In his crucial work, The Customs Union Issue, two forces, which decide whether a RTA better off the member countries, were well indicated, namely trade creation and trade diversion. Viner noted that preferential agreement member countries would have lower tariff barrier than non-members due to the preferential tariff and therefore trade creation effect and trade diversion effect are produced. Trade creation effect is generated because the bloc members increased each others intra-bloc import and export when a preferential tariff reduction or removal is induced, and consequently bilateral trade amount increases. In addition, the low-efficiency production in domestic provider would be replaced by high-efficiency providers in other bloc countries so that home countries can con sume this product with lower social cost. In contract, Trade diversion might be happened when a preferential treat is offered in member countries. Originally home country imports products form those high-production efficiency countries; however, due to the preferential tariff home town might import products from those low-production efficiency countries so that the social cost to consume this product rise and decrease domestic social welfare. Trade creation is a positive effect to domestic social welfare and trade diversion is negative. If trade creation effect is greater than trade diversion effect, home social welfare increase. Conversely, it would be harmful if trade diversion is greater. In The Customs Union Issue, Viner made a crucial conclusion that the formation of customs union has no certain welfare effect to members welfare due to these two trade forces. Accordingly, economists doubt whether we can prevent trade diversion as forming an RTA. Ohyama , Kemp and Wan proved customs union improve the welfare of members as given a fixed trade amount between members and non-members. On the contrast, if a change in nonmember trade amount would lead an uncertain welfare effect. Even Kemp and Wan theoretically showed that members improve their welfare completely in the fixed trade amount with outsider, that sounds once given an unchanging treat to outsider, the world must be better off. It implies through a negotiated optimal tariff we can create economic benefit and prevent being hurt from trade diversion; however, many empirical observations reveal that countries usually choose the trade policies which results trade diversion when they forming a RTA, namely RTAs benefit members and worse off nonmembers. The implication is Kemp-Wan result might not be the trade equilibrium. In fact, there exist other factors influencing the trade outcome of RTAs. The formation of an RTA related to political, economic and regional factors, the external tariff might be influenced not only economically but also politically. For example, lobbying might cause a distortion in government optimal external tariff adjustment. Thus, as we analyze the trade effect we better to account those factors in. In these few decades, economists focus on these two trade effects in RTAs and question whether RTAs generate more trade diversion or trade creation. Is RTA more trade diverting? Freund and Ornelas noted in principle RTAs can generate either net trade creation or net trade diversion, we must remember that participation in any RTA is a political decision. Thus only some types of agreements will be formed, depending on the objectives of governments. Except for the intension to maximize the social welfare, the decision whether to take RTAs might be influenced by specific-interest groups. Some literatures indicate domestic political factor might be a better way to explain FTA phenomenon. Grossman and Helpman reckoned domestic powerful specific-interest group usually lobby their government with huge money and resources to conduct RTAs which advantage them. Milner offered a similar viewpoint as well. He considered those export-oriented companies usually push government to enter a preferential trade agreement (PTA) to enlarge the bloc market which disadvantage outside companies. The powerful domestic companies have influences to the government election outcome so th at the relationship between lobbying and election outcome is another factor to be taken to examine the influence on RTAs. Above sounds RTA generates more trade diversion due to non-trade effects, but it still needs evidences Empirics of trade creation and trade diversion Unfortunately, the estimation of trade diversion is not an easy work. As above mentioned, the estimation has to account into both trade and non-trade factors which influence RTA outcome, therefore, a gravity equation is used to help this issue. The equation provides a theoretical way to examine whether a RTA generates more trade creation or trade diversion. The concept of natural trading partners were first proposed by Wonnacott and Lutz . They pointed that the agreements, which are conducted with those geographically close countries and similar culture countries, are likely to attain more trade creation. Tinbergen and Poyhonen successively used gravity model in international trade analysis and used it to research world trade flow and size. Tinbergen hence pointed bilateral trade flow and bilateral economic size have a positive relationship and have a oppose relationship with their geographical distance. Frankel applied gravity model to examine the natural trade partner hypothesis. He analyses the trade flow effect in different regional integrations by using different dummy variables like culture, whether they have common border or same languages etc. He reckoned gravity model is the best instrument to judge trade creation effect and trade diversion effect. Frankel used the data between 1965 and 1992 to examine the regional effect. When two countries belong to the same regional integration, then regional dummy effect is 1; therefore 0. The estimated correlation coefficient represents how many trade flows can be attributed to specific regional trade effect. The empirical result revealed the correlation coefficient in each variable was all significant. He found two-country GNP coefficient is less than 1. That means trade amount will not rise proportionally when the economic size of both countries increase 1. Also the distance coefficient is negative, that represents the trade decrease with an increase in distance. The distance result is similar to the result of Tinbergen. Frankel also found the same language and the same border has a positive influence to trade flow. For each regional variable, the outcome shows the regional trade effect is significant in Europe Union, MERCOSUR, Australia-New Zealand Closer Economic Relationship, and Andean Group, yet not significant in NAFTA. Frankel provided evidence for natural trade partners hypothesis by using gravity equation. Clausing used HS-10 digit import data of United State to access CUSFTA. She found due to the agreement signed in 1994 the import of the US from Canada had increased 26 percentage. the import from Canada increased half amount since 1989 to 1994 and Clausing attributed it to tariff reduction decision in CUSFTA. She found that trade creation are more general than trade diversion in most of cases. Furthermore, RTAs increase bilateral trade between members . Their research points there is no significant trade reduction between members and non-members be found. Other studies also examined the impact of regional integration to trade effect. For Europe Union, Kreinin pointed the establishment and east-expansion of EU would cause little trade diversion and huge trade creation. A distinct evidence was provided by Chang and Winer . They found the formation of MERCOSUR do hurt non-members but as Calvo-Pardo et al. pointed, MERCOSUR is a customs union (CU), which is different from CUSTA, NAFTA those FTAs. According to the literatures above, we found in most cases RTAs except MERCOSUR are likely to trade creating more than trade diverting. As well, if countries, which are natural partners, sign an RTA, it would benefit them. That is because the similar culture, for example, language, may reduce transaction cost. Consequently, the trade creation effect has more opportunity to be greater than trade diversion. That gives the incentive of government to negotiate an RTA with their close countries. Adjustment in External Tariffs Another issue trade economist cared is optimal external tariffs after forming a RTA. The original Vinerian assessments of trade creation and trade diversion are normally constraint to the policies fixed. However, there is at least a trade policy those RTA members would use: external tariff policy. Kennan and Riezman (1990) were the first to examine the optimal external tariffs after RTA was formed and they found the formations of RTAs are usually with external tariff reduction. Also, the same result was in several literatures. To avoid the welfare costs of trade diversion, optimal external tariffs seem to be lower in RTAs. Kennan and Riezman pointed there is coordination of common external tariff under CU. Unlike CU, FTA members have authority to set their external tariff unilaterally. Kennan and Riezman use this key different chrematistic between CU and FTA to see the external tariff adjustment outcome after the formation of RTAs. Another issue we will discuss in this section is the influence of lobbying to the formation of a RTA. In section II we reviewed those structural characteristics, which lead to more trade creation or trade diversion, of RTA members. Intuitively, bloc countries are willing to attain more trade creation and to reduce more trade diversion so that they can achieve the objective of social welfare maximizing, yet as mentioned in Section II the formation of RTAs are not only economically, more important, also politically. There are some incentives bloc countries hold to adjust their specific product external tariff rate so that they can achieve their objectives (no matter what that is). Thus, this section will introduce those incentives that members are likely to alter their external tariff and the reaction to members external tariff under the formation of RTAs, which is what we concerned. That will help us to figure out whether the political force would lead distortion among the RTA formati on. Incentives to alter external tariffs in RTAs with empirics The incentives to alter external tariffs in RTAs can be clarified generally in three main parts: the incentive due to CU, due to FTA and due to domestic producer influence. We will discuss them in the following content. The external tariff policy adjustment might be influenced by different types of RTAs. In CU their external tariff are coordinated by all members, on contrast, FTA members have more authorities on their own external tariff. Thus, the motivation in different types of RTAs might be different. Firstly, we examine the incentive to alter external tariff rate of CU members. According to Kenan and Riezman , the equilibrium external tariffs are also observed being higher than FTAs. They concluded two points. One is a custom union allows its members to internalize their tariff externality when bloc members import the same product. Another, a customs union makes several countries into one larger one and enlarges their market power. Similarly, the analysis of Bond, et al. also clarified the external tariff in an FTA would be lower in a CU due to the lack of external tariff coordination. Preferential margin is the differences between external tariff and preferential tariff rate. Higher external tariff leads to higher preferential margin. Also, the higher the preferential margin is, the larger the discrimination and trade diversion effect are. Therefore, inter-bloc countries benefit more from the CU agreement due to the discrimination effect. As what Kennan and Riezman found, Richardson indicated there is an intention of external tariffs to be reduced under FTA. The phenomenon is called the tariff complementary effect. Relative to customs union, there is neither large market power nor external tariff coordination effect under FTAs. Even so, motivations to alter external policies still exist. A simple way to think is that: trade creation is created due to the preferential tariff among the FTA members and trade diversion is generated simultaneously. An effective trade policy against trade diversion that government holds is external tariff policies. Hence, if a preferential trade agreement comes with a reduction of external tariff, it would enhance both the total welfare in the world and reduce a hurting on non-members. However, an issue is whether the external tariff should be removed under a FTA. Bond, et al. reckoned the implication of the lack of external policy coordination is that the optimal external tariff for an FTA should be positive. Logically, a principle is that external tariff for outsider should no less than preferential tariff for insider so that the agreement would not be meaningless. As what have mentioned in Chapter 2, there are some non-trade factors also affect the trade effects. The one which is broadly discussed is the effect of lobbying to external tariff in a RTA. When political motivations are concluded in, the net trade effect will become ambiguous. Empirics of external tariff adjustment in RTAs With protection, are RTAs more trade diverting? The impact of regionalism on multilateralism Kyle and Robert examined whether exceptions from MFN for the purpose of forming preferential agreements can lead to lower external tariffs, and thereby to a more efficient tariff structure unter the multilateral agreement. imply that the formation of the FTA benefits ROW. These findings differ from those that arise under a CU where typically there is a smaller external tariff reduction (or even an increase). This occurs because CU members jointly choose the external tariff to maximize union welfare, thus internalizing the positive tariff externality that exists whenever two countries import the same good from ROW. With the objective function that we consider, a CU will always be preferred to an FTA for symmetric member countries because of its more favorable market power effects25. Thus, while this model does not provide a positive theory of FTA formation, it does point out how international distributional effects differ between FTAs and CUs. It also suggests that, in the short run, FTAs are more appealing from a world welfare perspective because they imply relatively less aggressive tariff setting for their members.

Literature on Working Capital Management and Profitability

Literature on Working Capital Management and Profitability Regarding the research of working capital management and profitability. This chapter consists of literature review of different researchers and their studies findings in accordance to the region their studies are based on. I will start with the region of United States of American and followed by the European countries. Studies from other countries not included in the aforementioned regions will be described in the following topic. This chapter ends with a table summarizing the findings of different authors from this literature review. Variables Description Average Collection Period on Profitability In an article wrote by Milling (1991, p. 48), he mentioned that: Average collection period measures the time that a firms average sales dollar remains outstanding as an account receivable. Average collection period is formulated by dividing accounts receivable by sales and multiplying by the number of days in a year (365). It is the average number of days which a firm manages to collect its outstanding debts from customers (Garcia-Teruel Martinez-Solano, 2007). According to Lazaridis and Tryfonidis (2006), acerage collection period is one of the components to measure the cash conversion cycle which is manageable to maximize the profitability and improve firms growth. In Raheman and Nasr (2007) research adaptation, the correlation analysis between average collection period and net operating profitability shows a negative coefficient. This means that if the average collection period increases, it will lower the profits in return. However, the Pearsons correlation proved there is a strong positive relationship between average collection period and cash conversion cycle. Most profitable firms are observed to have a shorter period of collection period (Deloof, 2003). These same firms a re also larger in size, have higher sales growth and lower debt fin ancing. Further research done by Garcia-Teruel and Martinez-Solano (2007) had its result consistent with Deloof (2003) finding. They had agreed that elongate the deadlines for customers to repay their payments may project greater payment facilities, but would negatively affect the profitability of a firm. Sales may also be increased due to the leniency of firms collection policy. To increase corporate value, a high quality accounts receivable portfolio could be created, safeguarded and realized through effective credit management. This is due to heavy investments in accounts receivable by larger corporations. Hence, Pike and Cheng (2001) felt it is important to control the credit management policy and practices choices in order to maximize value. The lower the investments placed on accounts receivable, the more reduction in interest costs, hence, a respectable increase in earnings (Milling, 1991). Besides that, there is a close relationship between sales growth and the level of current assets (Kim, Rowland Kim, 1992). The example given was that the increment in credit sales will lead to higher inventories and accounts receivable. It is unavoidable to invest in current assets in that matter. According to Deloof (2003, p.584): An alternative explanation for the negative relation between accounts receivable and profitability could be that customers want more time to assess the quality of products they buy from firms with declining profitability. Schwartz (1974) debated that firms that are able to obtain funds at lower cost would offer trade credit to firms facing higher financing cost through finance-based models. Emery (1984) was able to conclude that investments in trade credit are a much better option for short-term investment than market securities. The advantage of trade credit can be spontaneous and exist without formalities, but the limitation is that it is available for goods and services only (Hossain Akon, 1997). Inventory Turnover on Profitability Zero inventory and Just-in-time manufacturing had been a popular inventory management practices (Reynolds, 1999). In much simpler terminology, inventory turnover means the cycle of using and replenishing goods. According to Reynolds (1999), inventory turnover analysis has major importance because inventory management directly impact operations profitability. This analysis serves as a measure of firms efficiency and profitability. Inventory turnover analysis can assist financial managers in recognizing problems and can help reduce associated costs. Average Payment Period on Profitability Companies of different sizes (small, medium and large) are now taking longer time period to repay their debts (Anonymous, 2005). The same author also mentioned that was affected due to larger companies imposing longer payment terms on their suppliers, who are usually not in a position to choose. Companies in a lower part of the chain would face cash flow problems as companies on the upper chain wait for payment before they pay their suppliers. Cash Conversion Cycle on Profitability The cash conversion cycle is able to capture the impact of an effective working capital management policy, which are due to the effects from turnover of receivables, inventories and payables. The function of cash conversion cycle is defined by Jose, Lancaster and Stevens (1996, p.34): The CCC measures the time between cash outlays for resources and cash receipts from product sales. The CCC is dynamic in the sense it combines both balance sheet and income statement data to create a measure with a time dimension. Richards and Laughlin (1980) consequently operated this concept by measuring the number of days funds are committed to receivables and inventories and less the number of days payments are deferred to suppliers. Shin and Soenan (1998) are able to prove a strong correlation between cash conversion cycle and profitability. Even so, they used a substitute of cash conversion cycle called the net trading cycle. Using this cash conversion cycle, also known as cash-to-cash (C2C), companies could establish a point of reference for inter-firm comparisons. Besides improving profits earned, companies could obtain overall efficiencies and balance supply chain operations (Hutchison, Farris II Anders, 2007). Regional United States of America According to a research done by Kim, Rowland and Kim (1992), it was about the implications of working capital management practices by Japanese manufacturers in the US. This study is to determine the objectives of working capital management by Japanese manufacturers in US and to identify options for funding. As Japans foreign direct investment in the business expansion of US has increased rapidly, therefore, it is important to manage the firms working capital well. International working capital management has significant importance as total assets and liabilities of multinational corporations consist of current assets and short-term liabilities. There are few differences in financial structure between the US companies and Japanese manufacturers: Japanese firms rely more on banks short-term debt. Japanese firms project a lower level of net working capital. Japanese firms operate with about half as much equity as US firms. Japanese firms hold twice as much in long-term investments as US firms. Japanese firms reported lower inventory level; more accounts receivables and twice as much cash as US firms. Questionnaires were sent out to Japanese manufacturing companies operating in US. Executives from these Japanese-owned firms perform this survey to determine the companys working capital policies and practices. The data reverted back to researchers show that Japanese firms rated the most important objective of working capital management is to be providing current assets and liabilities in support of anticipated sales, while minimizing investments in current assets being the least important. Moreover, most of their short-term financing were sources from Japanese banks. In 1996, Jose, Lancaster and Stevens performed a research on the relationship of corporate returns and cash conversion cycle. This study examined the long-run equilibrium relationship between a measure of ongoing liquidity needs (cash conversion cycle) and measures of profitability. Data collected were from the annual Compustat tapes, which covers the twenty-year period starting from year 1974 to 1993. There are altogether 2,718 firms which have complete data required. The variables were tested using nonparametric and multiple regression analysis, with the industry and size variable controlled. Richards and Laughlin (1980) and Emery (1984) had noted the constraints of using traditional financial ratios and believed in the liquidity management measures to reflect the ability of firms meeting their short-term financial obligations. Return on assets (ROA) and return on equity (ROE) measures are also included in this study to separate asset management and financing influence. Jose, Lancaster and Stevens concluded that there are key findings for ROA and ROE. These ass et management returns and levered returns revealed an increase in performance and benefits. Shin and Soenan (1998) did a study to test the efficiency of working capital management to create profitability. They used a Compustat sample of 58,985 firms covering the period 1975 1994. The relationship between the length of net trading cycle, corporate profitability and risk-adjusted stock return was examined. Net trading cycle could be computed as below: Net Trading Cycle = (Inventory Turnover + Average Collection Period Average Payment Period) x (365 / Sales) The outcome of the study shows strong negative relation between the length of firms net trade cycle and profitability. They also considered that working capital efficiency increases profitability; there will be a negative relationship between net trading cycle and stock return. The examination of this relationship is done using the correlation and regression analysis, by industry and working capital intensity. In their study, it is mentioned that working capital is a result of the cash conversion cycle. Gentry, Vaidyanathan and Lee (1990) developed the weighted cash conversion cycle, which scales the timing by the amount of funds in each step of the cycle. On the other hand, Deloof (2003) said that this method could not be used due to incompleteness of information available for calculation. Liquidity ratios, such as current ratio and acid-test ratio, could not measure the working capital management efficiently due to reasons that these ratios include calculation of assets which are n ot readily available to be converted into cash and the ratios ignored the timing of cash conversion (Shin Soenan, 1998). In all, maximum working capital efficiency is an essential factor of total corporate strategy to create shareholders value. A research was done on the international working capital of multinational corporations by Dr. Hadley Leavell from Sam Houston State University. His journal was published in 2006. To enhance profitability of multinational corporations, Ricci and Di Vito (2000) suggested reducing the floating costs of time value, losses on outstanding accounts receivables, transaction costs and foreign exchange conversion costs when moving cash between countries. However, the difficulty to overcome regulatory and geographical barriers may lead to a loss of control and payment regulations placed on cross-border cash concentration to maximize profitability. Regional Europe In year 2003, Deloof investigated the relation between working capital management and profitability of a sample 1,009 large Belgian non-financial firms between years 1992 1996. The cash conversion cycle was considered as the comprehensive measure for working capital, whereas gross operating income is the measurement for profits. There is the weighted cash conversion cycle modified by Gentry, Vaidyanathan and Lee in 1990, but was not applied by Deloof because of the limited information availability. Deloof related the correlation and regression analysis to his research to prove that there is a relationship between working capital management and profitability. Another research done in Europe is by Lazaridis and Tryfonidis in year 2006. They investigated the relationship between working capital management and corporate profitability of a sample of 131 companies listed in the Athens Stock Exchange. Data was collected from year 2001 2004. In this research, profitability was measured through gross operating profit and cash conversion cycle. Lazaridis and Tryfonidiss research also established that larger companies are cash-management-focused with more credit sales, which led to cash flow problems. Smaller scale firms are more focused on stock management and credit management. Similar to Deloofs (2003) research, the cash conversion cycle is used to describe the effectiveness of working capital management in this study. Regression analysis used in this research showed a negative relationship between cash conversion cycle and profitability. Garcia-Teruel and Martinez-Solano (2007) were involved in a research to provide evidence about the effects of working capital management towards to profitability of Spanish small and medium-sized (SME) enterprises. Many previous researches are focused on larger form of firms. They collected a sample of over 8, 800 SMEs which covers the year 1996 2002 from the AMADEUS database. The selection was done in accordance to the requirements by Europeans Commissions recommendation on the definition of SMEs. In fact, the current assets and current liabilities of their sample of SMEs proportion is the majority of total assets and liabilities available to the firms. They used the cash conversion cycle to measure the profitability of the firms on their research sample. Their study was supported by Deloof (2003), confirmed that firms can improve profitability by lowering outstanding accounts receivables and payables and inventories. A univariate analysis was conducted to determine differences in variables, followed by a multivariate analysis to determine working capi tal management on corporate profitability. Return on Assets ratio was set as the dependent variable to establish profitability. In the correlation matrix used, they found a negative relationship between their dependent variable (return on assets) with the number of days accounts receivables, days of inventory and days accounts payable. They confirmed that by shortening the cash conversion cycle, firms could improve profitability. Regional Others Hossain and Akon (1997) did a case study on financing working capital of Bangladesh textile mills corporations. This case study covers 40 public sector textile units under the ownership and administration of Bangladesh Textile Mills Corporations. The study covered a period of twelve years from 1982 1993. According to Hossain and Akon, well-known economists believed that current assets should be considered as working capital as the whole of it helps to generate profits. In their study, it shows that a vast amount of short-term finance was used in financing fixed and current assets to the extent of 100 percent. This caused a lower capability to earn profits, but increases the risk of insolvency. The aggressive working capital financing (using short-term funds to finance fixed assets) should be tamed in Bangladesh textile mills corporations to maximize profits, by resorting to long-term funds which are less costly. Methods used to test their hypothesis are through regression analysis and comparing the calculation of financial ratios. Raheman and Nasr (2007) had done a research to prove the relationship between working capital management and profitability of Pakistani firms. A sample of 94 firms listed on Karachi Stock Exchange was selected. Firms are listed for a period of 6 years from 1999 2004. It was mentioned that an excess of current assets could lead to a firm realizing its return on investment. However, it was proven otherwise if firms have a shortage of current assets (Horne Wachowicz, 2000). The measurement of profitability used by Raheman and Nasr is the Net Operating Profitability. They used the regression analysis to assess their hypothesis. Their study includes data of regression analysis of cross-sectional and time-series data. The pooled-regression (constant coefficient models) type of panel data analysis was applied. They believe that increase in the cash conversion cycle would lead to lower profit generation (Shin Soenan, 1998; Deloof, 2003; Lazaridis Tryfonidis, 2006; Garcia-Teruel Martinez-Solano, 2007). Summary of Literature Review Author (Year) Market (Region) Evidence of Findings Kim, Rowland and Kim (1992) Japanese Manufacturers in US (USA) Objective of working capital management is to be providing current assets and liabilities in support of anticipated sales. Jose, Lancaster and Stevens (1996) Compustat (USA) Key findings in asset management returns and levered returns. Shin and Soenan (1998) Compustat (USA) Relationship between the length of net trading cycle, corporate profitability and risk-adjusted stock return. Leavell (2006) Multinational corporations (USA) International working capital and multinational corporations. Deloof (2003) Belgian non-financial firms (Europe) Application of cash conversion cycle. Lazaridis and Tryfonidis (2006) Companies listed on Athens Stock Exchange (Europe) Larger companies are cash-management-focused, Smaller firms are more focused on stock management and credit management. Garcia-Teruel and Martinez-Solano (2007) Spanish SMEs (Europe) Effects of SMEs working capital management towards its profitability. Hossain and Akon (1997) Bangladesh (Asia) Financing Bangladesh textile mills corporations. Raheman and Nasr (2007) Karachi Stock Exchange (Asia) Working capital management of Pakistani firms and its profitability. Table 2.1 Summary of Literature Review Conclusion Working capital is about establishing optimum liquidity position by effectively managing resources invested in day-to-day operations of the business. After studying the journals and researches done, it can be concluded that liquidity and profitability of firms was affected by the components and working capital management measures (accounts receivable, inventory and accounts payable).