The number of court cases in the Britain involving violation of privacy and reputation has been exponentially increasing for the past twenty years. This has greatly drawn concern from both law makers and media regulators. Numerous bills have been drawn and there have been dozens of recommendations from media regulators, but one thing that has been difficult to achieve is a moderation of the two bodies in coming up with policies and bills that will ensure freedom of the press and at the same time ensure that the reputation and privacy of corporates and individuals are duly protected. For an individual privacy defines the ability of a person to express individuality, free from the constant and perusing eye of the public, it is not about committing crime or engaging in some illegal activity but a simple case of not washing one’s dirty linen in public. With limited knowledge the public can condemn and judge an individual based on the sometimes insufficient evidence therefore causing uncalled for shame and psychological trauma. This is the extent to which the press can use their mind blowing stories to damage an individual’s reputation and violate their rights to privacy. For a company’s the case is more or less the same because any company secret leaked out to the public can be used by competitors to defame the company or destroy the company. Not everybody who receives the information given by the press have good intentions, that is why more and more people and companies suing the press for leaking out some private or defaming information.

Regulatory bodies in the press have also attempted to come up with several changes in order to ensure the scrutiny the information spread by the press. The first attempt saw the establishment of the press council in 1953 but which was perceived by many as not being proactive in its actions due to the lack of power and mandate to execute its objective which was to censure unethical conduct by journalists. In 1989 a Bill which advocated for the setting up of a statutory body received so much support and it prompted the government to establish a committee to look into privacy and related matters. The committee strongly recommended the statutory body whose mandate would be to receive complaints related to privacy violation by the press. The press however did not like the idea of a statutory body and retaliated by setting up a parallel body to avoid this direction. The press later rejected the statutory way of regulation and the establishment of a new tort to address violation of privacy. The silent wars between the government and the press did not stop here and are as fierce as ever.

It is apparent that the press has also tried to establish regulatory bodies, but it has dire limitations that seem to promote privacy violation rather than prevent. For instance the Press Complaint Commission (PCC) is funded mostly by the print media that it is supposed to check. It operates by including people outside the press industry with the aim of providing judgment that is impartial and it has various clauses that assist it in executing its mandate. The clauses include statements that support everybody’s right to privacy in issues such as health, private and family life and correspondent and strongly states that any publication in violation should be justified by the press. The clause also speaks against the use of long cameras to take picture of people in private places. The messages are very strong but PCC is not strong enough to exert any legal action against any press material that has violated these statements. Furthermore if the guilty party comes from the press that funds this organization how sure the victims are that due action will be taken without any form of prejudice. However without any due process outlined by a statutory victims of privacy violation and reputation damage in case of a mistrial, have no otherwise except applying for a judicial review. The judicial review is further inefficient because it only looks at the credibility of the process used rather than the credibility of the ruling. The meaning of this is that the courts are can only reverse or refuse a ruling only if it can be out rightly meaningless, but in an opinionated case the court cannot interfere. Cases involving violation of privacy are sometimes very much opinionated and would therefore present difficulties for victims when trying to obtain appeal.

Many cases have presented the difficulty that exists during complaints concerned with privacy violation. For instance the case involving BBC v Barclay brother, Barclay brothers on realizing that BBC had in its possession a film of its private island sought to prevent the broadcast of the film by filing a complaint to the media house. However, the media house refused to tolerate such complaints. Barclay brothers went on and applied for a judicial review which was again rejected because according to the broadcasting Act of 1990 broadcasting could not be prevented prior to. The implications of this kind of law is that even if someone knew that the press had damaging information that they intended to broadcast the person is supposed to wait until the information is available to the public and the damaging effects felt in order to file a complaint. The victim might not even be sure to win the case because the information may be so damaging and traumatizing to the extent that even the public has passed its own judgment and convincing them otherwise would be very difficult. This means that the current laws in fact favor infringement of privacy and as a result there is no effect and substantial way to punish and prevent this kind of crime, a fact which is in complete violation of European Convention rights.

A more complex case involving Jameel v Wall street journal concerning a publication in the newspaper that suggested that Saudi Arabian officials should monitor some bank accounts of certain individuals because they had terrorism ties. Jameel group of companies were listed as some of the companies to be monitored. During the proceedings the jury ruled that the article contained information that compromised the reputation of the complainant because the complainant had done nothing incriminating or that would call for investigations, although the jury prevented the publishing of this article, it was later published after the September 11 catastrophe in New York. After the event the US placed froze many Saudi Arabian accounts especially the ones that had been mentioned in the article. Since most of the suspects were Saudi it was apparent that the UK which was a great supporter of anti terrorism actions of the US was sharing information with its ally. However, this kind of fact was considered sensitive and a matter of national importance and could therefore not be presented in a court of law as part of evidence. In the end the court ruled in favor of the complaint and awarded them money to cover for the damages caused. The proceedings of this case reveal a lot of things about how simple defamatory information can cause so much damage and the implication it would have on an organization or an individual. The reporters who came up with the stories were not even required to present the source of their information because as they claimed, it would place the life of the individuals in danger.

Another case involving the violation of privacy rights was the one of Spencer v United Kingdom. The case was about a publication in a newspaper which provided information and pictures of Countess in a rehabilitation clinic being treated for eating disorders and alcoholism. Further information concerning her family problems was also published.  This was in total violation of the PCC clauses regarding privacy because both personal privacy and family privacy were also violated; even in accordance with the European Convention on Human Rights a crime had been committed against the Countess. However during the reviewing of the case, the Human Rights Commission ruled that the Countess did not enjoy a general right of privacy in accordance with law of confidence. The commission therefore dismissed the complaint on the basis that domestic remedies were not completely exhausted. This means that the United Kingdom had the potential to tackle such as case but that it did not have the relevant machinery in terms of law and due processes. Therefore the commission was silently implying that the law in the UK concerning privacy violation was rather inefficient. In a related case of Peck v UK which involved a CCTV video of a man walking along a public street with a knife. The man who in this case was Peck was very much depressed and had attempted suicide. The PCC refuted Peck’s complaints in the grounds that they were inadmissible. The court ruled that since Peck had not anticipated the extent of exposure it would violate his privacy according to Article 8 in the vent that the footage was made public. However lack of domestic remedy in the UK prevented the case from materializing.

Article 8 of the European convention clearly outlines that a person has the right to a private life in the sense of his or her home, correspondence. This also includes a right to enjoy privacy in terms of correspondence and this is applicable in any democratic society. All the cases outlined above it is apparent that what the UK laws lack is remedies to counteract the infringement of privacy both of individuals and companies which are at times very damaging and whose consequences are irreversible.

References

Judgements- Jameel and others v Wallstreet Journal Europe. Accessed on 18^th April from www. Publications.Parliament.uk/pa/id200506/idjudgmt/jd061011.

Media Law Resource Center: LDRC Forum on English Libel and Privacy Law May 11 and 12, 1998. London England. Accessed on 18^th April, 2009 from www.medialaw.org/template.

Serial Killers In Great Britain: A Structural Condition rather than a Medical-Psychological One

Introduction

The dreaded menace called serial killing has been sowing terror in many societies for many decades, yet there has been definitive conclusion to what really causes this scourge.  Basically, a serial killer can be defined as a person who usually kills more than three people on different occasions within a span of 14 days (Leung, 2004, p.1).  Consequently, two dominant schools of thought have emerged to explain the reality of serial killers namely the medical-psychological standpoint and from a structural, environmental perspective.  In particular, the medical-psychological perspective attempts to explain the existence of serial killers within the context of the person’s psyche, while the structural view focuses on particular societal structures or conditions as the causes of serial killing (Grover and Soothill, 1999, p.1).  While the examination of serial killers can be assessed from both perspectives, there is a prevailing view that serial killings perpetrated by British citizens on British soil from 1960 to 2006 may have been  a result of structural factors rather than medical-psychological ones.  This paper examines this view from the studies developed in recent years.

Definitions, Characteristics, and Perspectives of Serial Killing

Definitions and Characteristics

Before jumping into the assessment of the reasons for the emergence of British serial killers, it is appropriate to first define what serial killing is.  Basically, serial killing involves a specific number of killings or murders and a time period.  For example, Grover and Soothill (1999, p.2) cited the six point identification of a serial killer by Egger (1984) specifically: there must be at least two victims; there is no relationship between the perpetrator and the victim; the murders are committed at different times and have no direct connection to previous or following murders; the murders occur at different locations; the murders are not committed for material gain; subsequent victims have characteristics in common with earlier victims (quoted in Grover and Soothill, 2007, p.2).  However, in line with the British serial killings from 1960 to 2006, David Wilson shares a simpler definition of a serial killer as a murderer who has “killed three or more victims in a period greater than 30 days” (Wilson, 2007, p.34).

Aside from the volume of murders and timeframe, serial killers also display certain mannerisms on personality characteristics.  As derived from the research study by Cindy Pokel entitled A Critical Analysis of Research Related to the Criminal Mind of Serial Killers, she cited Sear’s (1991) description of serial killers as those “suffering from anti-social personality disorder which tend to have the following characteristics: superficial charm, intelligence, absence of delusions or irrational thought, lack of nervousness, unreliable, untruthful and insincere, exhibit poor judgment and fail to learn from experiences, and incapable of love” (Pokel, 2000, p.45).  Consequently, as quoted in Wilson (2007, p.38), Holmes and Deburger (1988) derived four different types of serial killers from a study of 400 serial cases, with each type explained as follows:

Visionary - killer is impelled to murder because he has heard voices or seen visions demanding that he kill a particular person, or category of people.  The voice or vision may be for some a demon, but others may be perceived as coming from God;

Mission - killer has a conscious goal in his life to eliminate a certain identifiable group people.  He does not hear the voices or have visions.  He  mission is self-imposed;

Hedonistic - killer kills simply for the thrill of it - because he enjoys it.  The thrill becomes an end in itself;

Power/Control - killer receives gratification from the complete control of the victim.  This type of murderer experiences pleasure and excitement not from sexual acts carried out on the victim, but from the belief that he has the power to do whatever he wishes to another human being who is completely helpless to stop him.

All the documented British serial killers have manifested at least one of aforementioned manifestations from a period from 1960 to 2006.  As cited from Wilson (2007, p.27), there have been 19 British serial killers with a combined murder count of 326 victims.  Those killed were classified as elderly; women involved in prostitution; homosexual men; runaways and throwaways; and children.

The Medical-Psychological Perspective

As indicated earlier, one of the two main perspectives to explain the development of serial killers stem from medical-psychological factors.  The medical-psychological view can further be divided according to biological, psychological, and sociological causes.  In terms of biological causes, related literature point to physiological factors and human chemistry as factors triggering serial killings.  In particular, Sears (1991) presents several human biological conditions such as brain development, head trauma, heredity, and genetics, and male sex drive as factors that breed serial killers (quoted in Pokel, 2000, p.40).  Meanwhile, Scott (2000) identified extra chromosomes, high testosterone, and heavy metals found in the human body to describe the biological state of serial killers, while Mitchell (1996) identified five biological aspects involving evolutionary/ethological processes; neurological contributions; biochemical approaches; genetics; and race as the main determinants in serial killers (Pokel, 2000, p.40).

From a psychological perspective, Sears (1991) and Mitchell (1996) addressed the issues related to sexual sadism, paraphilias, and gender identity disorders, and both adhered to a Freudian approach to attaching serial killing to sexual impulse (Pokel, 2000, p. 46).  Meanwhile, Mitchell also focused on the aspect of multi-personality disorder of serial killers (Pokel, 2000, p.46).   Furthermore, Scott (2000) viewed serial killers as psychopaths who “often see the victim as a symbolic object and that psychopaths are generally out of touch with reality, but seem to know what is right and wrong with society” (Pokel, 2000, pp.45-46).

The third category under the medical-psychological perspective of serial killing is the sociological aspect.  Specifically, Pokel cites four main areas namely the aspect of power or control; societal norms and culture; and violence, family issues, and issues of self (Pokel, 2000, p46).  Of these factors, the need for power and control was considered by Pokel (2000, p.44) as the most prominent feature.

The Structural Perspective

One of the main proponents of the structural perspective of serial killers is Elliot Leyton who developed an excellent study entitled Hunting Humans: The Rise of the Multiple Murderer (Leyton, 1986).   Fundamentally, Leyton argues that to “truly understand why serial killers kill, we need to investigate the very nature of the social structure - the society - that has created these people whom we label as serial killers” (Wilson, 2007, p.17).  He further declares that “multiple murder is not the province of the mentally disturbed and that one has to look beyond the individual to the society, and in particular, the social structures in which he or she lives of one is to explain more fully multiple killing” (Grover and Soothill, 1999, p. 5).  Consequently, Mitchell (1996) also supports the structural view by theorizing that serial killers are people who are unable to meet the goals and values of society as a whole and consequently turn into outcasts (Pokel, 2000, p.36).  Mitchell also broached the “Strain Theory” that explains the behavior of strained people who are unable to derive achieve and success in society and thus resorts to killing as a means to self-accomplishment (Pokel, 2000, p.36).

The social structures that helped breed serial killers, as developed by Leyton (1986), encompass economic and political systems.  To illustrate the development of serial killers in society, he identified three major historical periods or epochs, each showing significant changes in the socio-economic conditions in society, and explained that in “these three periods, the social genesis of multiple killers and their victims are socially specific” (Grover and Soothill, 1999, p.5).  Furthermore, he theorized that there have been significant changes in the socio-economic background of killers and their victims between the historical epochs” (Grover and Soothill, 1999, p.5)   As seen in Table 1, the historical periods are the pre-industrial age (i.e. pre-late 19th century); the industrial period (i.e. late 19th century); and the modern period (i.e. post World War II).  In gist, the socio-economic conditions prevailing during the three historical epochs spawned serial killers who reacted violently in a term called “Homicidal Protests.”  Leyton explains this term as follows:

In each of the historical periodisations, the configuration of the social structure is such that some persons when faced with their challenges to their position in the social hierarchy react to those challenges the protest of killing members of the threatening group.  Homicidal protest can take different forms (qtd. in Grover and Soothill, 1999, p.5)

Table 1:  Three Historical Epochs, Serial Killers, and their Victims

Source:  Leyton (1986:269-95)

Ultimately, the structural perspective of Leyton implies that that the “acts of serial killers are not simply the result of deranged or dangerous personality, but more importantly, may be the consequence of a socio-economic system which cannot by its rabidly competitive dynamic reward the efforts of all, and may dangerously marginalize certain people” (Grover and Soothill, 1999, p.2)

The British Experience

The British experience in serial killing is considered by David Wilson in his book entitled Hunting Humans: The Rise of the Modern Multiple Murderer as a product of a structural perspective and reflects a form of “Homicidal protest” to the socio-economic changes in Britain in the last three decades.  However, Grover and Soothill (1999, p.13) does not consider Leyton’s structural analysis as mirroring the British experience since the latter described serial killers based on circumstances in the American setting.  However, they do acknowledge the vital role of Leyton’s structural analysis to serial killers in “understanding the meaning of serial killing at a societal level” (1999, p.13)

In examining serial killing in Britain, this paper turns to the work of David Wilson.  As cited by Wilson (2007, p. 27), serial killing emerged in Britain beginning 1960 and grew in significance in the succeeding years.  In particular, from 1960 until 2006, there have been a total of 19 confirmed serial killers murdering a total of 326 people.  However, Wilson also noted that there were no serial killers in the 1920 until the 1930’s as compared to Germany which had 12 cases (Wilson, 2007, p. 16).  Even up to the 1950’s, Britain was considered to be relatively peaceful and serial killing had still not taken root.  Thus, the question arises - why then did serial killers emerged suddenly beginning 1960?

Wilson answers this question by explaining the social-economic transformation that occurred in the Great Britain beginning 1960.  In particular, prior to 1960’s, the country in the 1950’s was considered as “one of the most conservative, stable, and contended societies in the world” (Wilson, 2007, p.28).  The socio-economic environment of Great Britain prior to the 1960’s was described as follows:

…the vast majority of people continued to go happily about their businesses, large part because of the foundations of the Welfare State laid down by Clement Atlee’s Labour Government of 1945-1951 - known by some historians as the post-war settlement.  By this they mean that there was political commitment from both the left and the right to full employment; state-funded social security; a national health service; free education; health and employment benefits; a mixed, part private, part public economy; and recognition of trade unions…(Wilson, 2007, p. 28)

With a generally stable, peaceful environment in Britain during the mid 1940’s until the 1950’s, there was no marked serial killing activity in the country.  Essentially, the stability in the socio-economic order in the country created a sense of “inclusiveness” in British society characterized by a community bonded in family and work security for everyone (Wilson, 2007, p.29).  By 1960’s and 1970’s, however, the political and economic landscape in the country has changed rapidly.  By this time, new economic demands such as free enterprise, advances in industrialization, and changes in the global labor market have emerged.  A “market society” soon developed whereby employment became a privilege of those who deserve or are qualified for it.  The shift from an “inclusive” environment to that of an individualistic, “every person from himself” mentality became the trend in British society as the economic, market-driven environment fostered by the Thatcher government was installed in 1979.  Eventually, the highly competitive, individualistic socio-economic environment which shattered the reality of job security soon changed the way Britons viewed themselves.  Jock Young, a criminologist who analyzed the historical evolution of British criminality in his book The Exclusive Society: Social Exclusion, Crime and Difference in Late Modernity described the breaking down of societal ties during this period:

The market brings together wide swathes of the population…it creates the practical basis for comparison.  It renders visible inequalities of race, class, age, and gender.  It elevates a universal citizenship of consumption, yet excludes a significant minority from membership (Young, 1999, p.47)

Consequently, Young concludes that the advent of individualism has “undermined “relationships and values needed for a stable social order and hence gives rise to crime and disorder (Young, 1999, p.50).  In this kind of environment, some groups inevitably became marginalized and some individuals who were unable to deal with the new demands of society resorted to violence to fill a need for some kind of achievement.  This scenario ushered in the birth of serial killers in Britain.

Wilson further illustrates the tumultuous period of free enterprise and market-driven principles advocated by British government upon the ascendancy of the Thatcher administration and onwards by citing employment statistics culled from a study done by Will Hutton entitled the State We’re in (5th ed.).  For example, according to Hutton, “one in four of the adult male population were unemployed or idle as of 1995; unemployment had increased six-fold since the oil crisis of 1973; one in three children were living in poverty; and that the state is doing all it can to wash its hands of future generations of old people” (Hutton, 1995, p.199).  Furthermore, Hutton also indicated that the trade unions, which were instrumental in securing job security to union members, weakened considerably from 1979 to 1993; and that the period of the 1980’s was a time when “qualifications unemployment benefits and support became tougher; the state pension became progressively devalued in relation to average earnings; and the distribution of income more unequal” (quoted in Wilson, 2007, p.31).  Amidst this depressed socio-economic environment, Wilson notes that the country in 1986 “produced more serial killers that at any other point in British history” (Wilson, 2007, p.31).

The supremacy of the Structural Perspective versus Medical-Psychological in Britain

The structural, socio-economic perspective was deemed to have significantly accelerated the development of serial killers in Britain.  Although the medical-psychological view was never debunked to explain the serial killer development in the country, the current line of thinking supports the primacy of the structural perspective over medical-psychological explanation when it comes to analyzing the British serial killer cases.  As cited by Grover and Soothill (1999, p.4), “there has been a change within the psychological approach over the past 30 years as contemporary psychologists are willing to recognize the importance of the social context much more readily than formerly” (Grover and Soothill, 1999, p.4).  More significantly, Grover and Soothill (1999, p.4) also expressed the fact that psychiatrists had been unable to reconcile the paradox of correlating mental deviance with psychiatric abnormality when in actuality, “few offender are so psychiatrically disturbed as to be termed mentally ill.”  Furthermore, Mitchell (1996) declared that the link between genes and serial killer has not been proven and that it is “not possible to make a general statement that all serial killers as psychopaths” (Pokel, 2000, p.41).  Instead, Mitchell argues that our current society seems to be moving away from a common societal goal and that serial killers remain outcasts in society and are unable to meet the changing needs of society (Pokel, 2000, p.49)

Conclusion

The spate of serial killings in Britain from 1960 to 2006 can best be explained through the rapid, tumultuous socio-economic changes beginning in the 1960’s.  The breaking down of cherished values such as a sense of community, family, and job security to give way to  a market society driven by free enterprise, individualism and competition has inevitably marginalized some groups and filled others with intense hate and a disposition to kill.  The fact that the highest number of serial killers emerged during a period of intense socio-economic breakdown marked by massive unemployment, poverty, and declining incomes only reinforces the view that environmental, societal influences sparked the development of serial killers in Britain.  However, this paper does not attempt to discredit or nullify the possible link between medical-psychological factors to serial killers.  In fact, future study might derive some biological and psychological influences to explain the emergence of British serial killers.  Nevertheless, the pressing question still remains - if medical-psychological factors do influence serial killing, then the time element should have been rendered insignificant.  In effect, serial killers should have emerged every year in Britain since time immemorial - even in stable, peaceful times - since the causes are internal, biological, and innately psychological, which implies the absence of external causation.  The reality, however, is that serial killings in Britain emerged at a specific period in the country’s history.  In this light, the structural view remains the logical choice.

References:

Grover, C and Soothill, K 1999, ‘British Serial Killing: Towards a Structural Explanation’,

British Society of Criminology, vol. 2, pp.1-17

Holmes, RM & De Burger, J 1988. Serial murder: Studies in crime, law and justice, Vol. 2.

Newbury Park, CA: Sage.

Leyton, E 1986.  Hunting Humans: The Rise of the Modern Multiple Murderer, McClelland and

Stewart, Toronto, Canada

Leung, J 2004, The Personality Profile of a Serial Killer, A research paper in Forensics

Mitchell, EW, 1996, The Actiology of Serial Murder: Towards an Integrated Model,

Unpublished Master’s Thesis, University of Cambridge, United Kingdom

Pokel, C 2000. A Critical Analysis of Research Related to the Criminal Mind of Serial Killers,

Research paper, The Graduate College University of Wisconsin-Stout, United States

Scott, SL 2000. What Makes a Serial Killer Tick? <www.crimelibrary.com>

Sears, DJ 1991.  To Kill Again: The Motivation and Development of Serial Murder, Scholarly

Resources: Wilmington, Delaware

Wilson, D 2007.  Serial Killers: Hunting Britons and Their Victims, 1960-2006, Waterside

Press, United Kingdom

Young, J 1999, The Exclusive Society: Social Exclusion, Crime and Difference in Late

Modernity, Sage Publications, London

They Say Hot? I think Not!

Honestly speaking, there are a lot of words in the English dictionary which are really confusing and unfathomable to me. The sad thing is that there are a lot of people whose vocabularies are not like that of a modern-day Shakespeare or Milton. It never fails to amuse me how people can just come up with a word which seems very appropriate for a particular thing. The even more amazing thing is that we never expect that the word casually coined by people would be incorporated in our everyday language. Most amazing is that sometimes, those words and their respective definitions make it even to the accepted dictionary. To end all that, the deliberation should begin.

Citing an extremely familiar example, the word “hot” surely will stand out. I have read and still read magazines and digests which frequently discuss the accepted standards of beauty. However, it was only a few years ago that the word “hot” came into the picture. Before we knew it, it had become every person’s description of a particular man or woman who exhibits desirable physical attributes. For example, a man who is hot in the eyes of women exudes Adonis-like qualities. A very manly, a rugged face, a muscular torso which boasts of a six-pack abdomen worthy of being cast in the film 300, and a suave voice. Add to those a gorgeous height, an action star aura and a smile that says “Girl, can I take you home now?” On the other hand, a hot woman by general definition possesses movie-star facial features and a voluptuously curvaceous body to kill for. Either those qualities or a supermodel-slim figure, belly button flashing with a piercing, and an oozing Playboy-worthy sex appeal which is windowed by eyes that say whilst staring, “Catch me if you can, boys.”

That drives us to an immediate conclusion. The word hot refers to sexually-attractive men and women capable of making admirers swoon. Not just an innocent swoon, but a swoon that drives innermost sexual desires on the brink of being blurted out of their mouths.

But then again, if that is really the definition of hot then hotness is unarguably synonymous with sex appeal. It pushes us to think even deeper. Even though hotness almost always refers to sexual attractiveness then why is it that some women, from Hollywood and from real-life alike are branded hot when they are not always caught with their sexy bodies flashing and their belly buttons exposed? The answer can only be provided by the individual being asked. On the other hand, the same case in men presents an equally valid argument, or should we say question because an argument regarding hotness sounds a bit absurd. One such example as I have read in a very popular women’s magazine, is the so-called hotness of a guy who possesses nerdy qualities albeit handsome face. Picture an unkempt hair, thick spectacles and not so fashionable clothes (the actor Adrien Brody comes to mind here). Why is it that a nerdy guy can be called hot when he does not have the aforementioned qualities? Quoting from Robert Plant, it really makes me wonder. Another argument follows, why is Audrey Hepburn considered one of the hottest women that ever walked the planet? It really is sheer insanity to say that she is not beautiful. But in striking contrast with the today’s standard of beauty to which Scarlett Johansson perfectly measures up, Miss Hepburn does not exude heaping sex appeal. Even less that eye-catching figure, the body that makes guys whistle. But instead she has a royal beauty that only Hans Christian Andersen could have described better. Still, she is hot if I am to be asked. I know none would disagree to that.

Upon the deliberations, I now reckon that the real meaning of vague is utterly vague. I do not mean to offend the media giants and the magazine magnates and their proponents. But for me, the real definition of hotness cannot be dictated by such beauty authorities, although they can serve as references. Sexual or not so sexual, intellectual or plainly physical, the definition of hotness lies in the perception of the beholder. Hotness associated with bodily appeal should not be condoned, and neither should hotness embedded in subtle beauty. Whether it is action star looks or nerdy appeal, it can be adjudged as hot. Whether it is Vogue-worthy beauty or Virgin Mary-like appeal, beauty can be described as hotness, and vice versa. It is in the eye of the beholder. The true meaning of hotness is always hanging, about to be said, about to be heard from anyone’s mouth and cannot be classified as definite.

Accounting - Introduction, History and Background

Accounting is just not a neutral method that serves as a recorder of the past; instead it is also something that affects the future decisions to be made by an organization including their results.Accounting in general is considered to be a method which helps in recording the financial transactions of the organization that took place in the past.  The accounts of a company usually look into the past and reveal the financial decisions and their results which were already taken by the organization.  However, accounting cannot be considered just as a neutral tool that is simply a recorder of the past.

The methods and principles of accounting that are used also affect the future financial decisions already taken by the organization including their results.  There can be a major influence of the accounting consequences of different kinds of available options with which the decision makers are faced with, on the final decision taken.  Thereby, the choice between the different methods of accounting may not limit themselves to just the portrayal of results; they may also play a vital role in the actual shaping of future decisions including the organization’s financial structuring, functioning and activities.

Generally Accepted Accounting Principles (GAAP)

The double-entry system of accounting is based on a set of principles which are called Generally Accepted Accounting Principles (GAAP).  These principles enable to certain extent standardization in recording and reporting of information so that the users, once they are aware of the principles, can read and understand financial statements prepared by diverse organizations.

Statement No.4 of Accounting Principles Board of USA on “Basic Concepts and Accounting Principles Underlying Financial Statements of Business Enterprises” describes accounting principles as follows:

“Generally Accepted Accounting Principles incorporate the consensus at a particular time as to which economic resources and obligations should be recorded as assets and liabilities by financial accounting, changes in assets and liabilities should be recorded, when these changes are to be recorded, how the assets and liabilities and changes in them should be measured, what information should be disclosed and which financial statement should be prepared (ICFAI Centre for Management Research ICMR, 2004).”

To standardize the accounting information, every organization would have to establish certain accounting policies based on GAAP.  Accounting policies encompass the principles, bases, conventions, rules and procedures adopted by managements in preparing and presenting financial statements.  There are many different accounting policies in use even in relation to the same subject.  Since the task of interpreting financial statements is complicated because of the adoption of diverse policies in many areas of accounting, in formulating the GAAP the three conventions of relevance, objectivity and feasibility are followed.

As far as Woolworths is concerned, the main problem with the company is not related to its accounting systems but rather is with inventory shrinkage and thefts in shops and in also in transit of inventory.  Inventory shrinkage accounts to almost 56% and theft is approximately 44%.  Also, the company became a victim of the credit crunch and the recent economic downturn.  The debt amount of the company at the time of filing bankruptcy was approximately estimated to be £385 million.

Woolworths was under immense competitive and also financial pressures.  During the year 2008 when the entire world entered into a recessionary phase and a massive credit crunch, Woolworths scraped its interim dividend and also the company entered into administration.  With this news becoming popular in the UK market, the company’s sale of lottery tickets was suspended.   The claimants were also prevented from redemption of their prizes.  The move of Woolworths to enter into administration was because of its incapability to pay off the debts into which the company was already into.  Finally the company decided to shut down the entire chain of stores all across UK.  In the process of closing down, the company started offering an unbelievable discount of almost 90% and also most of the stores even sold the fixtures and fitting too.

The recent Financial Crisis and the aftermath

History shows that the economies do not grow in a uniform pattern.  There may be several years of economic growth followed by a recession and in some cases even a prolonged depression.  This may be accompanied by falling national output, declining profits and real incomes and rising unemployment. In course of time, the economy recovers and if the recovery is very strong it may lead to a boom.  During the boom period the economy will experience prosperity which means a long period of high demand, more employment opportunities and improving standards of living.  Prosperity may also lead to inflationary conditions marked by rising prices and speculation.  This would be followed by another slump in the economy.  All market economies are characterized by movements in national output, inflation, interest rates and employment.  These movements could be either upward or downward.

A business cycle may be defined as a swing in total national output, income and employment.  It usually lasts for two to ten years and is characterized by expansion and contraction in many sectors.  A business cycle has mainly two phases:  recession and expansion.  Peaks and troughs are the tuning points of the cycles.  Recession takes place when there is a downturn in the economy.

Economic growth is dependent on mobilizing savings and directing them into productive channels.  In this process, money supply can only play a limited role.  However, the role establishes an important connection between money supply, output and price level (ICFAI Centre for Management Research (ICMR)).  These relationships cannot be ignored even if the primary concern of the government is mobilization of real factors that ultimately lead to economic growth.

The demand for money in the society is very high.  Due to such a high demand, the reasons for people’s charity is never thought of or clearly known to many.  Demand in economics means effective demand, which can be defined as a desire backed by willingness and ability to pay for a particular product.  Thus, in order for a demand to be effective, three important factors namely the desire to buy, willingness to buy and ability to buy are the important factors (ICFAI Centre for Management Research (ICMR)).

A recent current affair that raised eyebrows and also created a panic situation to the millions of investors’ world over, in the global financial market is the financial crisis in some of the world famous financial institutions namely Lehman brothers’, American International Group (AIG), Fannie Mae and Freddie Mac (Amateur Economists, 2008).  Out of these financial institutions, Lehman brothers went bankrupt and Fannie Mae & Freddie Mac were seized.  The only fortunate institution among the ones listed above was AIG which was lucky enough to be bailed out by the U.S. Federal Reserve.

All these recent happenings can be related to what is known as “The Big Bank Theory” of finance and economics (PinoyMoney.com, 2008).  According to this theory, no government across the globe will allow any big financial institution or a bank to collapse so easily.  This is because the after effect or the consequences of such collapses would definitely be great and at time will be out of control to handle despite how big the economy in which the collapse occurred. This exactly is the basic reason as to why AIG was bailed out by the U.S. Federal Reserve.

As already stated in the initial parts of the paper, Subprime mortgage crises have become an ongoing economic problem in various parts of the globe.  The basic reasons behind these crises may be described as contracted liquidity in the banking systems across the globe and also in the credit markets.  Risky lending, excess of corporate and individual debt levels, risky practices of borrowing also can be added to the list of reasons for subprime crisis to occur.

Similar things as discussed above happened with Woolworths UK too.  The company was into debts which were actually 16 times more than the acceptable credit level for a company according to accounting standards.

Accounting Scandals - An insight

Firms may window-dress the financial statements in order to show a rosy picture of their accounts.  In such a case, the whole exercise of analyzing the statements becomes useless.  Window-dressing is also done to forecast a better picture to shareholders, bankers and financial institutions.  It is a rosier picture that what it actually is.  Window-dressing is accomplished in general ways - by not making adequate provisions though prudence would require them for expenses and potential losses, by taking into account income even before its actual accrual, by playing around with inter-corporate adjustments etc.

“Security analysts earn their money basically in part, by advising investors of both private and institutional organizations on how to invest their funds. They may judge some companies to have good future prospects which are not fully reflected in the company’s share price; therefore, their recommendation will be to buy the company’s shares. Alternatively, they may judge other companies to have poor future prospects which are not reflected in their share prices; therefore, their recommendation will be to sell the company’s shares. While security analysts carry out their own independent research into companies they can come to different conclusions about a company’s future prospects. However, in most cases there tends to be a reasonable degree of consensus in these forecasts (simon, 1998)”.

“The primary purpose of financial statements is to show the underlying economic performance of a company. The balance sheet provides a snapshot of the assets, liabilities and capital of the business; and the income statement, or profit-and-loss account, shows the difference between total revenues and total expenses. The auditors analyze and assure that these present a fair view, acknowledging the subjective nature of some of the measures behind the accounts (Economist.com, 2002)”.

Financial statements are prepared for the purpose of presenting a periodical review or report on progress by management and deal with the status of investment in the new business and the results achieved during the period under review.  They reflect a combination of recorded facts, accounting conventions and personal judgements, and the judgements and conventions applied affect them materially.  The soundness of the judgement necessarily depends on the competence and integrity of those who make them and on their adherence to the Generally Accepted Accounting Principles and Conventions.

Since each use of accounts may have a different focus in viewing the financial statement, it is necessary that the accounting statements are not biased in favour of anyone interested group.  It is therefore, necessary for an accountant to ensure that the accounts represent a “true and fair” picture of the affairs of business.  It may be often difficult to draw a clear line between true and untrue, and fair and unfair accounts; yet if the accountant prepares the financial statements free from any bias in favour of any user group and remains faithful to his self - conscience, chances are that the accounts thus prepared will be true and fair.  As accou7ntants are human and prone to errors there would be the probability that the accounts presented are indeed less than true and fair.  A reader of accounts must therefore, develop sufficient capability to see through such accounts or read between the lines to offset the biased presentation of accounts.

Certain scandals that took place in the United States of America in some companies like Enron and The Arthur Anderson also resulted in giving more attention to the problem related to the accounting field in certain private businesses.  This kind of corruption and accounting scandals need not necessarily be considered in private companies alone as many public sector companies also are being involved in such issues.

Rules and principles of accounting are basically designed in such a way that they provide certain standardized frameworks which help in the assessment of the financial position of a firm or a government.  However, there is always a chance of frameworks of accounting leading to bad information which in turn leads to bad decision making and obviously bad decision making would result in serious consequences in the long term.  Even this fact turns to be true for both public and private sector companies.

The companies which were quoted in the above paragraph, namely Enron, Anderson and many other companies depicted how accounting rules and principles can be misused and abused in order to provide a misleading picture of the facts of what is actually taking place in the organization.

There were many accounting scandals that took place in the last year.  In fact, it was believed that last year saw the largest ever accounting fraud that was recorded.  This is evident from the fact as an amount of $3 trillion which was actually a surplus was transformed into a deficit of almost $2 trillions.  These sorts of scandals are not limited to private companies alone.  At times even many governments are getting involved in misusing the rules of accounting and other similar things.

Certain unexpected failures of some businesses in the past two decades, which indeed were believed to be well-publicized, led to a number of questions.  The failures also involved failures of financial institutions and also large government bailouts.  The questions which cropped up as a result of these failures were about what are the expectations of the public from an independent audit of the public companies including their effectiveness.  Public expect that the effectiveness of the audit to meet their expectations.  Today, there are many new factors that are posing a challenge to the traditional financial reporting, its relevance and its usefulness.  The factors are globalization, the complexities involved in the business transactions which are increasing day by day and also the advent and advancement of information technology and the World Wide Web. Additionally, the role of the auditor in serving the interest of the public is also affected by these factors.

As a follow-up of the Great Depression, the Securities and Exchange Commission (SEC) was established in the late 1930’s.  The main reason for establishing the Securities and Exchange Commission (SEC) was to help and protect investors in the auditing of their financial statements and in also in the financial disclosures.  The SEC used to help investors through the regulation of securities.   The important and most vital role of attesting the financial statements and other relevant data along with maintaining the reliability was fulfilled by the profession of the public accounting.  The independent audit function of the public accounting profession was used widely.

The critical element that helps in the effective functioning of the securities market is none other than the confidence of the public in the fairness of the financial statements.  Federal Securities Laws are the ones which help and protect the investors by making all the companies disclose their financial information.  As part of this law, it is also required by the public companies to get its statements audited by independent public accountants.

It is indeed the most important responsibility of any public limited company to prepare the financial statements which need to be in accordance with the Generally Accepted Accounting Principles (GAAP).  From the investor’s perspective, in terms of sensitivity, the benefit gained by a particular investor is believed to be more only when he understands the financial position of the firm he has invested in.

As an account of the credibility crisis, the profession of accounting is believed to be facing a major overhaul.  The self-regulatory system of the accounting profession is said to be in the process of replacement and also many new legislations are believed to be prohibiting certain services to the audit clients.  Also due to such accounting scandals, the overall image of an accountant has truly fallen down from top to the bottom.  Such scandals and misuse of accounting rules resulted in the debate of the issue as to who will determine the standards for accounting and auditing.

It can also be noticed that as a consequence of such scandals, the stock exchange and the Securities Exchange Commission have started increasing the requirements of the financial literacy of the audit committee.  They have also started strengthening the independent standards for all the members of the audit committee.  Unless the corporate reporting is strengthened in its credibility, the hope of restoring the confidence of the general public in the markets is very less.  This is obviously true indeed.

The scenario of Woolworths:

Woolworths was considered as one of United Kingdom’s most cherished U.S. imports retail seller.  It was actually part of a UK group company called Woolworths Group Plc that held a high-street retail chain of stores all across the United Kingdom.   Woolworths consisted of a total of 800 stores and was considered to be the most important enterprise of the entire group.  It used to sell many imported goods and also had own brands in the children’s clothing range and toys.  The Woolworths chain was also the leading supplier of sweets in the United Kingdom.  Other enterprises of the Woolworths Group Plc included Entertainment UK and another distributor of books named Bertram Books.

The retailing proficiency of Woolworths stretches across various merchandise like food & grocery, liquor, petrol, general merchandise and consumer electronics (Woolworths Limited, 2007).  The company is listed in the Australian Stock Exchange.

The bankruptcy of Woolworths was considered as the largest retail bankruptcy by many people.  If the reasons for the company filing bankruptcy are considered, the first and foremost reason being stated is the Credit Crunch.  Lending is a crucial activity for a bank as it enables the bank to generate income.  But to sustain income generation, prudent decisions need to be taken both prior to and after sanctioning the credit.  These decisions are generally related to issues like the size, security and repayment of credit to be extended during a financial year, the industries to focus on, the geographical spread, the type of credit to offer, the type of proposals to finance, the disbursal mechanism, the collateral value, the method of pricing, the repayment schedule, the monitoring process, etc.

Credit is the mainstay for any financial institution particularly banks and financial institutions.  Almost 60% of the assets side o a bank’s balance sheet is credit.  The bank’s or the management of the various financial institutions’ across the globe should thus, ensure that lending decisions fall in line to sub - serve the bank’s overall objectives of growth and stability (ICFAI Centre for Management Research (ICMR), 2005).

The second reason was attributed as reduced spending by the consumers.  A recent article published in The New York Times speaks about the decreased spending of the people of United States of America.  This fact was evident from the recent report of United States of America’s GDP; the real spending rate of consumers had slumped in the third quarter approximately at a rate of 3.1% p.a.

The above situation of reduced spending of American consumer is very surprising as the people of the American economy never decreased their spending even in the past wherein situations like recession etc. took place.  Even after the recession of the American economy in the year 2001, the consumer spending in the United States Economy continued to increase. Also, the economy has never experienced this kind of slump since the year 1980 during which the American economy was experiencing a double-digit inflation along with a serious recession.  Though according to the views of economists, the current situation of decreased spending by consumers of the American economy can be viewed as the offsetting of the increasing debt of the consumers with the continuously rising stock portfolios, it is hard to believe it when considered the worst situation of the economy.

According to the principles of introductory macroeconomics, though consumers feel that they are doing the right thing by increasing their savings level, it can definitely have an adverse affect on the economy.  This is because, if the consumers decrease their levels of spending and no other activity that can compensate this decreased spending takes place in the economy, then obviously the economy will slip into a recessionary situation and this will ultimately decrease the income levels in the economy.

In order to handle the situation when consumers’ cutback their spending, the Federal Reserve would usually decrease the interest rates as this measure would not only save the economy from going into a recession state but also helps in increasing the investment levels. However, this measure may not be always possible to be taken by the Federal Reserve due to a variety of reasons.   With this kind of situation of the economy, the government needs to address the issue of decreased consumer spending by bringing in revised economic policies.  Consumers need to be motivated through new set of fiscal policies that encourage the levels of government spending.

The third reason was excessive Debt.  According to recent reports, Woolworths was believed to have a debt amount that was 16 times more than its current market value (What the Finance - Economics and Finance Blog, 2008).  Generally, companies need to maintain a good liquidity position to handle unforeseen contingencies.  The income motive is meant “to bridge the interval between the receipt of income and its disbursement”, and similarly, the business motive is “the interval between the time of incurring business costs and that of the receipt of the sale proceeds.”  Companies do hold reserve cash to get out of hard times during economic downturns and recessions etc.  However, it is not right for a company to have a debt of this excessive amount.

Actions to be taken:

Certain important measures which are believed to avoid organizations from misusing accounting principles have been framed by different committees.

A particular system should be designed and implemented which helps in the current disclosure and thereby provides real time material information.

In addition to the historical information, other significant data pertaining to the current trend and evaluation should also be made available for disclosure.

The financial statements should be framed in such a way that is easy to interpret and understand.  Issuance of such easily understandable financial statements brings about a drastic change.

The corporate governance system that is employed by the organizations’ should be very strong.  The system of corporate governance should include an audit committee which has the required expertise for reviewing the system of financial reporting and the audit function.

Giving higher importance to the audit committee of a particular organization is because it is the audit committee which is believed to be responsible to take care of the quality and integrity of the company’s accounting practices.  The audit committee of a company is believed to oversee certain very important and crucial elements such as:

The quality and integrity of the accounting practices of the company along with the financial statements.

The compliance of the firm with all the different legal and regulatory requirements.

The internal audit functions of the Company and the performance of the same.

Conclusion:

If the financial statements and the different accounting policies of the company are carefully observed and evaluated, then there is every chance for the investors to spot the warning signs about such scandals and misuses at a very early stage.  Certain other aspects which allow financial analysts and investors to be aware of the happening in an organization are key ratio analysis, the insider trading activities and their review, comparison of the projections of the management with the current market trends and last but not least, being highly alert about the relationships between the customers and the partners of the business.

Keeping in view all the above discussed points, it is all the more obvious that if investors are a little more careful and alert, then happenings of such scandals can be cut down to a large extent.  Today, as a result of the tremendous advancement in the field of information technology and the changing business operations are to a great extent influencing the need for comprehensive and real time data.  The need for audited financial information has increased drastically.  This is because independent assurance of the reliability of the reported figures is provided by the audited financial information.

Bibliography

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Economist.com. 2002. Badly in Need of repair. Financi & Ecoonomics: Economists.com. May 02, 2002, pp. 1-5.

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ICFAI University Press. 2003. Business Ethics and Corporate Governance. Hyderabad : ICFAI University Press, 2003.

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simon, Jon. 1998. Why do companies use creative accounting? Association of Chartered Certified Accountants - Articles. May 01, 1998, pp. 4-7.

What the Finance - Economics and Finance Blog. 2008. Woolworths Bankruptcy. What the Finance - Economics and Finance Blog. [Online] What the Finance - Economics and Finance Blog, November 27, 2008. [Cited: April 12, 2009.] http://whatthefinance.com/stockmarket-watch/woolworths-bankruptcy-93.

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Introduction

Is there any difference between leadership and management? Or leadership and management are the same? On a close look it can be seen that many managers are not leaders, though successful in their field. Leaders lead from the front and managers believe in directing controlling and planning and improving the efficiency of the organization. A manager makes the subordinates to work, a leader work with the people. Management philosophers and thinkers have been interested in identifying the difference between a manager and a leader.. Some leaders show management skills and some mangers show leadership skills. (Mccrimmon M, 2007) It is now well established that there is difference between a manager and a leader

Leader leads from front

A leader leads from the front. His language will be like come let us do the work. On the other hand a manager believes in planning and coordinating the work. He uses management techniques to manage others. Followers voluntarily follow the leader. This may not be the case with managers. Subordinates is been asked to obey the instruction of the manager by virtue of his position. The subordinates may be obeying the manager on his leadership skills or may be just as it is part of their duty. It is also common the subordinates dislike the manager and still follows his action to save his or her job. A leader has his interest common to the followers. When the common interest is being identified, people voluntarily follow him. Rather than asking the people to work, a leader prefers to call them for work and they just follow the instructions of a leader. This important quality makes a big difference between the style of functioning of a manger and a leader.

Difference in working style

There is a big difference in the working style of a manager. A leader attracts the people with the charisma he is having. He used to have an upper hand in technological knowledge than the workers. Leadership may not have any relevance with the functioning of the organization. On the other hand the management is different in its way of functioning. A manager keeps the organizational priority at his best. He has to do certain tasks as per the guidelines set by the organization. He then plans to achieve this by his people. Here the manager uses the modern management tools. He is interested in directing, planning and organizing. To make this effective he also uses modern management tools. A leader innovates and the manager administers (Bennis W, Doyal S, 2006). Leadership is setting up vision and Direction and management is implementation of this (Doyal S, 2006).

A leader set his vision and the followers follow his vision almost voluntarily. He seldom needs force to attract towards him in execution of his direction and vision. On the other hand the manager executes the vision of the organization. On his journey towards this he will also be using leadership skills to effectively manage his people. A manger with leadership skills can effectively manage the organization. There should be a force attracting the followers or a subordinate to the person directs them. In case of leadership it is often the quality of the leader or his charisma that attracts the people to him. On the other hand the manager and the leader should be the two sides of the coin. Latest management trends show an inclination towards improving the leadership qualities of a manager. It is accepted that a manager should improve the output of the organization but it should be on the cost of the people working in the organization.

Directing Function

The directing function of the manager is making people ready to perform certain task or assigning certain task to the people. This functional area of the manger has more to do with leadership. Once a task is to be performed, the concerned manager has to detail people or direct people to accomplish the task. This is mostly done in different ways by a manager and a leader. However both leader and a manager use the function of directing. Followers voluntarily work as per the direction where as manager needs to have something else for motivating the people to work. This may be different to different organization and also as per the management style it differs. Organizations have special structure and policies to motivate the people to work and managers are part of it.

In the field of emergency medical services the directing function of the manager has a lot to do with routine jobs. Things are to be done at high pace and many times immediate decisions are to be taken. The chances of going these decisions wrong are high. In this scenario subordinates should be motivated and encouraged to take decisions at time of emergency. Also the manager should be able to provide directions without any delay. His competence as a leader is very important. A leader comes forward to take the responsibility of the actions of his followers. The followers also recognize this fact and there are more people willing to work under a leader under emergencies. This is what actually needed in an emergency service. At the same time the leader should be conversant with the procedures adopted in an emergency. A manager is a technical person and he is likely to be thorough in procedures and policies. Union of managerial qualities and leadership skills will be a good formula for emergency medical services.

Emotional Intelligence

Leaders are emotionally more intelligent than ordinary managers. A manager wants to be successful should have high emotional intelligence. Emotional intelligence is the ability to understand and control one’s emotions and to understand the emotions of others. People having high emotional intelligence tend to be leaders. According to Terry, “a leader shows the way by his example. He is not a pusher; he pulls rather than pushes (Terry R G, 1988). A typical manager does not follow this style. He plans and direct people to get the work done. There is set of duties and responsibilities for each person in the organization. A manager ensures this is been done. He uses his control function to see things are going as per the schedule. A manger often uses his control powers. In contrast a leader expects his subordinates to perform the way it is desired. For example if a staff is coming late to his duty. The typical manager may think of taking corrective action, where as a leader may be thinking to find out the reasons behind the late coming of the staff and may be willing to support that person. Similar actions make the follower emotionally attached to the leader and they keep the individual interest only next to the common goals

In emergency medical service, emotional intelligence is a highly required quality of the person heading the operation. A leader who is empathetic and understands the emotions of others can do a lot in getting people involved in the service. A leader should avoid knee jerk reactions. It is already said emotional intelligence makes the difference in actions of a manager and a leader. A manager who is low in emotional intelligence may follow only the rule book and this kind of attitude may lead to poor quality service especially in emergency medical service. It is good to be knowledgeable but at the same time the managers should understand the need of being empathetic to the subordinates and the customers.

Leadership in Emergency Medical Service

The EMS (Emergency Medical Service) is becoming more and more complex day by day. The system is working with a lot of supervisors, ordinary staff and managers and a wide net work is being formed. Due to all these it has become very difficult for people associated with these services to survive without leadership skills. A leadership includes motivating and directing people to work. Emergency service requires quick action and this demands intrinsic motivation rather than anything. Only a true leader can make the intrinsic motivation in people following him. A leader motivates people to work for a common goal. In this service too, the person heads the department has to motivate the people to work for the common goal. A true leader can do it more effectively than a manager.

A leader should be a team player. Emergency service is always a team play. Mere management principles will not make any difference to the organization. A lot of uncertainty is present with the Emergency services. A manager should be capable of handling these services. People under him should be willing to work for extra hours if required. If extra service is required it should be given on volunteer basis. Here the scope of leadership is more visible. A leader can motivate his team members to provide their best.

Team members perform will perform to their full potential when the team leader motivates them to do so. The team leader should be empathetic to his team mates. He should make the people well aware of the team goal and the members should feel that the goal is common to all. Then only their full potential can be utilized. A leader should also provide a platform for the members to learn and grow. This will make the team members to become more professional. This will also increase the efficiency of the team to perform tasks.

Functions of management

Functions of management are Directing, Organizing, Planning, controlling and staffing. Professional managers are trained to perform these functions. Some people are on the view that Directing is the most important function of a manager. Many managers believe decision making is an important function of the manager. In the Emergency Medical Service Industry manager should be good at decision making. He will have to make decisions in seconds. A manger is trained to have these qualities. In management schools Case studies are used to impart the skills of decision making.

A leader has the quality of decision making and directing, a leader’s method of directing and decision making differ from that of a manager. Leaders decision are derived from that of his team members where as the managers decisions are learned decision and the decision the manger thinks to be good for the company.  In respect to other function like controlling and planning a manger uses modern management tools. An ordinary leader may not know these tools for planning and controlling. Hence in these function a manger may have an upper hand in delivering the duties. But if the manager has leadership skills then he can really outperform an ordinary manager. All leading management institutes have special curriculum to sharpen the leadership skills of the managers. It is also said it is important to become a leader then become a manager by learning management tools. Management is ‘managing men’ and a leader is expected to do this function well. Leadership involves in common interest and goal. By this common interest and goal a leader can motivate people to attain common goals. Managers seek scientific methods to perform their task. Leaders are not interested in going for such tools and management techniques. They are good motivators.

Born Leaders and Managers

Many people believe leaders are born to be leaders but not they believe there are born managers. People believe management qualities are trained. This may not be true regarding leadership qualities. For example, in accident sights some people emerge as leaders and guide others on what to do. These leaders are not trained to become managers or leaders. It is also observed that such people repeat the leadership role in similar occasion. This shows they are born leaders. Many view that leadership skills can be trained on individuals. But training on leadership skill is more difficult than training on management skills. It is also observed that function of direction is the most difficult part for any managers. Unless people have certain inborn skills it is difficult to direct other people.

In emergency medical service, to make the service more useful and effective, leaders are required than mere mangers. Emergency situation are unique and the robotic act will not help. A kind of intuition is the requirement of medical services. It is not that made up managers will be a failure. But born leaders can perform the task of emergency dealing perfectly

Leaders should have technical skills and personal skills to be more effective. If the leader does not have adequate knowledge people may not obey him in the long run. The followers should believe that the leader is more knowledgeable and technically competent than them. This gives the followers confidence to work with the leader and they will feel an assurance that the leader will look after them in case of any trouble. Leaders are more approachable than managers. They like to meet people and discuss their problems. Leaders suggest measures to resolve the worries of the people when people approach them. These characteristics are not applicable to managers. Managers are mainly concerned in increasing the profitability of the organization. In contrast leaders are more concerned about their followers.

Managers and Leaders

Successful managers are efficient leaders. Bill Gate is a successful leader as well as a good manager. There are other examples too. Most successful managers are not MBA holders rather they are good leaders. On a close view it can be understood that it is important to become a leader first than becoming a manager. Story of successful managers in all fields underlines this factor.

There are other differences in the styles of managers and leaders. A manager makes his decision and then sells his decision to his followers. Manger compares alternatives before making decisions. He asks his subordinates to question if they have any doubt. In case of a leader his decisions are more acceptable to the mass and that is the reason they follow the leader.

Conclusion

There is a difference between leadership and management. Managers are more concerned about planning, controlling, staffing and organizing. Leaders are more concerned about directing and organizing people. They act more as a representative of the followers. People follow leaders voluntarily than by virtue of their position. Leaders should have high emotional intelligence. In Emergency Medical Service leadership qualities are more sought after than mere management skills. Managers with good leadership skills can produce best result. Successful business people are good leaders as well as good manager. To be successful in the long run a manager should have leadership skills.

Reference

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Negative point on open marriages

A minute can change your world. A minute can separate one life from the next. A minute can destroy so much. Open marriages are fragile minutes ticking past. They are callow myths that appeal to fantasy and physicality, which people step with innocence into, yet are dramatically and devastatingly blown out of, often time naïve to the repercussions that will undoubtedly catch them in the end.

The conflicts involved within open marriages range from the literal to far over to the ethical. To speak literally of such dilemmas, one cannot forget to leave out the concern with STDs. In an open marriage, one has the feeling that they are free and unrestrained and the problems of the world cannot, and will not, affect them. But the truth is, STDs are more common now than ever, and a common, yet serious misconception is that the older generation is less susceptible, more knowledgeable than the younger. If an open marriage is supposed to work on the grounds laid before, and not be hypocritical or contradictory, than an open marriage could involve many partners, and where one partner may be honest, the next maybe not, and in many cases a person who has certain STDs might not even know they have it.

Even though it might totally go against everything the open marriage was agreed upon, jealously has a belligerent way of coming into the main relationship. Rules that are often given mutate and shift, and suddenly one rule that was agreed upon is twisted and no longer is an agreement had, but an ongoing lie, which spreads throughout many relationships. Time spent away from the main partner lead that partner to start questioning and wondering what is happening while the other is away. And since open marriages are not based on monogamy and trust, communication has away of disappearing. In fact, not telling is always the culprit for jealousy and distrust.  In an open marriage one does not have to communicate. They can say “I was out”, or “Just went into town”, to the details of their whereabouts, and in this type of climate, jealousy has an all-to-easy way of creeping into the marriage and ultimately destroying it, leaving the two parties devastated and alone.

When engaging in an open marriage you are not just hurting yourself and your spouse, you may also be hurting someone you did not even consider. There are always many unseen factors when dealing with these particular relationships. Children have a very difficult time with open marriages. Children look upon their parents as role models; they are the rocks of the worlds, and in open marriages, children that constantly see their mother or their father with someone else, shakes that foundation and leaves them wondering why Mom and Dad no longer love each other. This does not just happen with children who are already born, it also takes place with children born through these open marriages. Children being born through these open marriages are born with a disadvantage. Not only do the children have to try and understand where their place in life is, but the parents of that child, parents not married to each other, but to someone else, someone with lives and families of their own, have to determine to what to do with this child. Nothing is more debilitating to a child than to not know its place in the world.

Open Marriage: the state or practice of having more than one romantic relationship at one time.

Problems with open marriage

STDs

Unsafe sexual practices with multiple partners

You may not know where the other has been

Health is a big issue with open marriages

People can go to a bar or club to pick up people and have sex with them without knowing their past partners and their sexual health

Can than in turn give the STDs to you “main” partner

Jealousy

“Main” partner may feel inadequate

Other person may get jealous that they are not your main focus

Scheduling is a full time job. Balancing time and energy between multiple partners can be extremely draining and hard to manage

When it “does” work it often leaves at least one spouse constantly miserable and or angry

Can you mentally handle an open marriage

Babies with more than one partner

Children that you have with your “main” partner may have a misunderstanding as to what a marriage and sex really is

Enduring effects on the children can last a lifetime

Jenny Block writer of the book Open: Love, Sex, and Life in an open Marriage, comments on bringing her other partners home with her to play with her husband and child. She openly goes out with both her husband and her “friend” Jemma on dates and is intimate with both, how do you explain this to your child? Where are your priorities?

You can have children out of an open relationship with more than one person

Illegal

In some states adultery is illegal and both spouses can go to jail if caught in an open marriage -

Why some people choose to have an open marriage

They are not sexually, physically, and emotionally taken care of by just one partner

Freedom to choose who you are with at any given time

According to Alex Caroline Robboy, a Philadelphia based sex and marriage therapist and founder of www.HowToHaveGoodSex.com , there are two basic approaches to sexuality:

Sex as an expression of love

Sex as a fun activity or hobby like playing basketball on the weekends

George and Nena O’Neill

The two wrote a book called Open Marriages: A new life style for couples in 1972

The book talked about an open marriage and they introduced the term to society

They weren’t just talking about the freedom to explore sexual relationships outside the marriage they suggested that marriage partners be free to have their own separate friendships and that they trade domestic chores

Why are marriages failing

A higher number of open marriages end in divorces

People can find someone else who can greater meet their emotional needs and physical needs than their current spouse

Open marriages are less committed to seeing the hard times through

Marriage is not an easy thing to deal with

Vows: for better or for worse and till death do us part

People are not sticking it out when the going gets rough

People married for 50 years did not have all fun and games hard times hit everyone and it is how you deal with it

Robboy states “I think people honestly tell themselves that it is an honest attempt to make their marriage work, but it raises a red flag for me. It is incredibly common and incredibly destructive for couples to experiment with open marriage in response to problems or boredom in their sex life. This is not the time to experiment with open marriage, you need to have an extremely healthy relationship.”

Monogamy Myths

Monogamy is the state of having only one wife, husband, or sexual partner at one time

Society views this as the ideal form of family organization

Critics of monogamy say that socially marriage oppresses women and that lifelong sexual monogamy is unnatural and unrealistic

Myth: 60% of men and 40% of women will have an affair during their marriage

A society that supports monogamy can promote women’s equality because they are the only ones for their husbands and not seen just as a piece of ass

Sexual monogamy facilitates intimate and lasting relationships

Dr. Diana Kirschner

A couples therapist who was a guest on the Fox morning show Mike and Juliet

“usually this whole thing is a recipe for disaster. There is competitiveness, jealousy, very limited time, and affection, time for sex, and all these resentment s start. The head says we think we can handle this but other feelings take over and you get a run away train effect and a lot of people get their hearts broken.”

“Of course the divorce rate is high, and that’s with just two people. Can you imagine with three people, how much more complicated that is, whose going to be left out, who’s going to get a broken heart?”

Open marriages are dangerous and further weaken marriage, an already seriously weakened institution

Survivors of an open marriage by: Jennifer Gates

Gates and her husband tried an open marriage for ten years with little success

Her book outlines the dangers of an open marriage

Gates blamed inability to control emotions as the reason her open marriage.

Her and her husband are still intact and are now closed and monogamous

The rules to follow in an open marriage

Steve and Cathy Brody wrote the book Renew your Marriage at midlife.

They say it is next to impossible to lay down any ground rules

They question how people can predict their feelings with so many people involved

“you can try to set up guidelines in a rational and intellectual way, but you can’t anticipate the depth of the emotional reaction you are going to have,” says Steve Brody

One rule is crucial! If one partner wants to stop the arrangement, thy both do

It comes down to communication, agreed upon rules, and compatible values regarding sex

In reality people often break the rules

Once trust is broken the open marriage is at risk

“If you play with fire enough, sometimes you get burned.” Says Mike and Joan Wilson whose open marriage failed after three years almost destroying their 14 year marriage

What if you fall in love with another person?

Solutions

A live in marriage: two people in the love relationship live together as husband and wife. They’re wholly committed to one another and even raise kids together. However they are not legally married. This means they can go their separate ways anytime they wish with minimum uproar.

If you want an open relationship simply do not get married

Non-monogamous relationships outside of marriage are tricky enough much less dealing with the legality of a marriage

The sense of belonging and specialness are willingly compromised, even carelessly discarded in some cases paving the way for jealousy and pain

The use of marital therapists and counselors can be very beneficial for struggling couples

Marriage anyway you look at it is meant to be a committed relationship between two people

Marriage is by definition: the social, legal, and religious institution in which a man and women or any two parties for mutual benefit to live together as husband and wife

Minutes are all we have in this life, minutes extend to hours, hours to days, and days to lifetimes, open marriages jeopardize those precious moments. Whether or not you believe in marriage is your own opinion, but once marriage is agreed upon, vows taken, a responsibility then becomes shared. Monogamy is not a death sentence. On the contrary, it is a beautiful and wonderful experience, one of openness and trust, even exploration, because once the minutes of lust culminate, nothing will be over.

In every society the general public as well as business organizations will be guided by certain norms on the basis of their respective ethics. Traditional values, customs, and religious thinking are influential in shaping individual values. At the same time the government and its agencies will make use of statutes and legislation for maintaining a disciplined social life. Various law enforcing agencies of the state will be interfering with the activities of individuals and organizations in case of conflicts with rules and regulations meant for greater common goods. In majority of the cases the ethical values of a society or of a business organization will be constructively serving the functions of legal agencies by maintaining the required discipline. Therefore in normal cases the interference of government agencies with legal powers can be avoided in the case of a society or organization preserving healthy ethical values. In such society or organization, the individuals are expected to follow the code of conduct and socially acceptable values, voluntarily. While defining and forming the code of ethics, larger interest of the society as a whole is taken into consideration. On such occasions individuals are expected to function in such a way that the greater common interest is respected (Ethics Today: Personal, Practical and relevant). The accusation of the antitrust and oppressive competitive activities against the Microsoft has come up before the court, when Bill Gates was functioning as its CEO. Bill Gates tried to deny the allegations but the court ruled against his argument and as a result the employees and stakeholders of the company were demoralized. Business Ethics was the major point in this case.

Social acceptance is the most important factor in shaping the ethics of individual as well as the group. Therefore for ethics to get established in any society, it must have social acceptance. The code of ethics will be nurtured and strengthened by personal values associated with positive attitudes and positive behaviors. On several occasions, in a social set up, members with diverse values may find it difficult to adjust with the code of ethics of a group. On such conflicting occasions the personal values must be adjusted with socially acceptable values so that destructive conflicts are avoided. Basically business organizations are working with an aim of making profits. (Is U.S. Society Serious About Business Ethics?).

By having a strong corporate ethics, a business organization will be able to follow fair business practices in order to avoid any damages or injuries to the customers and stakeholders. By fulfilling the legal requirements such as attaining of proper documents related to licensing and insurance, the organization can reinforce its corporate ethics with legal validity (Business Legal Issues). This is against business ethics to bargain stiffly by using the strong partner against a weak partner, by trying to impose the plans as per the unilateral decisions. The business organization must be given enough time to study about the possibility of structural changes. Mutual cooperation and trust between the companies, which has got developed as an ongoing process of business practices involving the active partnership must be respected and protected. As a natural process some kind of dependency may get developed between the two companies and in this relationship one may be at a weaker position due to its position being that of a junior partner. The flexibility and dynamic nature of a company will be decided to an extent by the structure of the organization. But on the part of one dynamic and flexible company, it is neither fair nor ethical to adopt a policy of bargaining with an intention to exploit the weakness and dependency of a faithful partner. Instead of adopting coercive methods of bargaining on the basis of its supremacy in the market, it will be better to have an amicable settlement to the issue by giving some more time to the partner to achieve the goals set by an appropriate team.

In the modern era of global economy and dynamic information technology, a company with strong culture and ethical values is in need of leadership with creative thinking. Knowing about the right tools combined with some regular practices will enable anybody to acquire the ability of creative thinking. In the case of organizations, managers and staffs can encourage creativity by ensuring the participation of people in decision making, problem solving and making changes in the work place. It is found that the best solutions to problems are possible when people are encouraged to and assisted with finding solutions. This aspect encourages organizations to develop creativity. (Practical workplace strategies).

On several occasions, due to adverse social realities, it may not be possible to follow practically the Ideal principles of values and ethics in a world of diversity. On such occasions it is advisable to adjust in a better way in conformity with the statute and in the interest of the organization. In the case of an individual, values are more related to beliefs and ethics are more related to behavior. Therefore values and ethics are not same. Values are based on beliefs and therefore not visible for the public. But in the case of ethics, as it is based on behavior, it can be seen by others. For an organization while deciding upon its values and ethics the relationship with these factors must be taken into consideration to avoid any major conflicts. At the same time adherence to legal requirements established by the respective government agencies is mandatory. (Values and Ethics). .In this case the organization is functioning in the information technology sector and the mission and vision of the organization is guided by the social values and ethics related to the concept of optimization of efficiency by abiding by the rules, and regulations of the industry..

Assumptions, values, norms, and behaviors of the members of an organization play important role in shaping the culture of an organization. Culture of an organization is a decisive factor in projecting the personality of the organization. Every member of the organization can sense the culture, even though they may find it difficult to express it. (Organizational Culture). The aggressive steps taken by Bill Gates as the CEO of the Microsoft Company were crucial in broadening the business area of Microsoft and thereby making it a company with wonderful and the fastest growth. On the other hand Bill Gates along with his wife Melinda Gates created the charitable foundation known as the Bill& Mellinda Gates foundation. This charitable foundation became famous for its transparency in operation (Flat-pack accounting). Many of the business practices of the Microsoft, which have faced litigation, were approved by Bill Gates as the CEO of the Microsoft. The Microsoft antitrust case is considered as a land mark in the twentieth century corporate case involving antitrust and monopolization. During his deposition testimony in the court, Bill Gates denied the charges by either arguing with or evading the questions of the examiner David Boies. In spite of the denial by Bill Gates, the Court ruled that the monopolization, blocking competition, and the antitrust act were violated by the Microsoft.(Gates deposition makes judge laugh in court).

In the post industrial era business world, the economy is dominated by the trends that are prevailing in the information age and therefore the public policies must be enacted accordingly. In this context the case of United State v. Microsoft was influential in shaping the fundamental terms of competition in the dynamic high tech markets. There were certain similarities between the issues of Microsoft and those of the IBM. The IBM Company was paralyzed due to its entanglement with the government. Bill Gates tried everything in his power to avoid such a mishap with the Microsoft, but the IBM phobia of Gate resulted in government slamming down on Microsoft and thereby creating a situation of uncertainty combined with demoralized employees and slumping stock price. Before the beginning of the Microsoft trial, Bill Gates as the CEO of the company was regarded as a high tech hero with inspirational and innovative ideas. Under his dynamic leadership with full of ideas and burning passion the company was able to unleash an industry and thereby transforming an economy. He was able to reflect his image and foster a culture through the company. At the same time his lack of wisdom to the ways of the world resulted in his failure to develop his peripheral vision (The Truth, the Whole Truth, and Nothing but the Truth).

The definition of right and wrong may vary significantly as the human activities are getting more and more influenced by science and technology. A well defined system of rules is formed in an organization to provide exact definition of ethics. In such cases it may also happen that an individual’s values and views may be secondary to the code of ethics of the organization. An organization can benefit in many ways by implementing the code of ethics. A basic idea about ethics is that it must have social and legal acceptance. In every society and organizations there will be a set of rules and procedures. While functioning in a volatile and dynamic field of economy the leader of a company like Microsoft must be able to give due regards to the rules, regulations, and ethical standards prescribed by public agencies. If not done so, the aspiring and innovative decisions taken by the CEO like Bill Gates may some times prove counter productive for various interested groups including the stakeholders of the company.

References:

1. (Values and Ethics) can be viewed at website at

http://www.au.af.mil/au/awc/awcgate/ndu/strat-ldr-dm/pt4ch15.html retrieved 15 March2009.

2. (Organizational Culture) can be viewed at Website at

http://managementhelp.org/org_thry/culture/culture.htm retrieved on 15 April 2009.

3. (Ethics Today: Personal, Practical and Relevant) can be viewed at Website at http://www.casanet.org/program-management/volunteer-manage/ethics-today.htm

retrieved on 15 April 2009.

4. (Is U.S. Society Serious about Business Ethics?) can be viewed at Website at http://www.spectacle.org/0305/shatt.html Retrieved on 15 April 2009.

5. (Business Legal Issues) can be viewed at Website at

http://www.morebusiness.com/legal_aspects Retrieved on 15 April 2009.

6. (Practical workplace strategies) can be viewed at Website at

http://www.practicalworkplacestrategies.com.au/pws/ Retrieved on 15 April 2009.

7. (Flat-pack accounting) can be viewed at Website at

http://www.economist.com/business/displaystory.cfm?story_id=6919139 Retrieved on 15 April 2009.

8. (Gates deposition makes judge laugh in court) can be viewed at Website at

http://edition.cnn.com/TECH/computing/9811/17/judgelaugh.ms.idg/index.html Retrieved on 15 April 2009.

9. (The Truth, the Whole Truth, and Nothing but the Truth) can be viewed at Website at

http://www.wired.com/wired/archive/8.11/microsoft_pr.html Retrieved on 15 April 2009.

The Marketing Game: A Strategic Tool for Managers in the 21st Century Market Place

Introduction

The rapidly changing and turbulent economic environment of today requires companies and enterprises to implement responsive, relevant marketing strategies to survive and grow in whatever industry they are in.  These strategies are necessary to address intense competition; changing market behavior and preferences; and the emergence of new products and technologies that change the dynamics of the marketplace.  Indeed, the main competitive factor for success in many companies in today’s environment lies in the formulation and implementation of effective marketing strategies that focus on consumer analysis, competition analysis, and industry assessment, and the appropriate marketing mix involving target market strategy, product development, pricing, promotions, and place.  Ultimately, the entrepreneur or corporate manager who best understands the dynamics of the market stands to succeed and profit the most in the long-term.

In recent years, business and marketing tools have been invented to assist business strategists, entrepreneurs, and managers on how to plot market strategies.  One of the most recent is called The Marketing Game (TMG) developed by Charlotte Mason and William Perreault, Jr. This marketing simulation game has attracted hordes of users for its applicability, flexibility, and systematic approach to market strategy formulation.

The Marketing Game or TMG

The marketing tool called TMG is considered an effective marketing strategy program or framework because it allows users to strategize using simulated, relevant business conditions.  As explained by Dr. P.V. Balakrishnan (2007) in his marketing presentation entitled Marketing Management Laboratory BBUS 438 for the University of Washington, the TMG aims to accomplish the following objectives:

To develop skills in identifying market opportunities, encompass knowledge of and the ability to apply key marketing frameworks and tools in analyzing customers, competition, and marketing strengths and weaknesses;

To develop insights about creative selection of target markets and making integrated strategy decisions concerning product, price, promotion, place, and the needs of the target market;

To develop skills in marketing analysis; and to provide meaningful and practical experience in translating qualitative and quantitative analysis into conclusions about profitable marketing strategies and programs.

A key feature of the TMG program is that it incorporates all the elements needed in a game environment in the same manner as sports.  In particular, as described by Balakrishnan (2007), the TMG adheres to the key elements of sports namely players, tools, grounds, scoring systems, and umpires.  In relating sports to business, Balakrishnan (2007) describes the players as competitors; the marketing mix, factories, and distribution systems as the tools; the markets are the grounds on which the game is played; share prices and market shares are the scoring systems,; and the regulators are the umpires.  Fundamentally, the TMG is designed to allow users to engage in market and strategy planning activities in a simulated, competitive environment using a rapid feedback mechanism (Balakrishnan, 2007).

The Applicability of TMG

One of the main strengths of the TMG as a market planning tool is its applicability.  In particular, the program attempts to approximate a real business situation in need of strategic market planning.  Thus, as explained by Prof. A.J. Otjen of the Montana State University College of Business University, the TMG presents a “living case where you learn about a situation, evaluate opportunities, develop a strategy, and make market plan decisions (Otjen, 2009).”  She   also harps on the game’s computer modeled feedback mechanism that summarizes marketing outcomes, related financial results, based on both the plan and competitors decisions (Otjen, 2009).

Thus, as explained by both Balakrishnan (2007) and Otjen (2009), an essential attribute of the TMG is that is captures the highly competitive nature of a business environment.  More importantly, the game requires that users, who can be entrepreneurs or corporate managers, to examine and assess a variety of factors affecting a company in relation to the industry it operates in.  In effect, the TMG adheres to one of the most authoritative business and management strategy thinkers in the person of Michael E. Porter, who developed a comprehensive framework to analyze the competitive environment found in industries.  Specifically, Porter, from his book entitled Competitive Advantage: Creating and Sustaining Superior Performance (1985), developed the Five Forces Theory of industry structure.  In this theory, the competitive environment in the industry emanates from the bargaining power of suppliers, the threat of substitutes, the potential entrants to the industry, the bargaining power of buyers, and the intensity of rivalry among existing firms (Porter, 1985).  Basically, these five forces influence each other, and consequently, firms in a given industry operate and create marketing strategies in response to the competitive pressures of the industry and the competition.  This view is echoed by Otjen (2009) in describing the TMG as quote as follows:

…The simulation is competitive, and you must carefully analyze what marketing mixes competitors are offering or what customers they are targeting because that obviously impacts the strengths and weaknesses of your firm and choices that customers have in the market…

Therefore, from a strategic perspective, the TMG clearly defines the relationship between the uncontrollable factors in the industry or marketplace and the controllable factors a firm can manipulate.  In particular, Balakrishnan (2007) explains that the TMG considers such independent variables as competition, consumer tastes, the regulatory environment, and economic, social and cultural factors to have an effect on the marketing strategies of the firm.  In turn, these strategies are aimed to elicit behavioral responses on the part of the customer namely product awareness, brand loyalty, and consequently, product purchase.  In the end, the firm measures the effectiveness of its marketing strategies through specific indicators such as sales, profits, return on investment, market share, among others.

A Systematic Approach to Market Planning

To appreciate the value of the TMG, one must examine the systematic manner in which the game process was designed.  As derived from Otjen (2009), the TMG process flow is illustrated in Figure 1 below.  Basically, the player of the TMG assumes the position of the marketing manager in charge of all the marketing initiatives of a given firm.  Consequently, as explained by Balakrishnan (2007), the game begins with an analysis of the market situation and a determination of market opportunities.  In this phase, the business manager examines the industry environment or market place environment to determine such vital trends as industry growth, customer behavior and trends, technological factors affecting the industry, the competitive environment, among other key market conditions.  After assessing the market place and identifying programs to tap into market segments, the manager is then compelled to engage in sales planning and budgeting in view of the products and services to be introduced in the marketplace.  In the sales planning stage, the manager needs to account for the product’s market share data and forecasted volume of demand per customer segment and distributional channel.  Meanwhile, the budgeting process includes the determination of the necessary costs to be incurred in positioning and introducing the product in the market place.  Budgeting items may include salaries, research and development (R&D) costs, advertising and sales promotions, expenses, customer service expenses, market research reports expenses, and so on.

Once the forecasts have been derived, the manager then formulates and calibrates the marketing plan, which is basically composed of the four P’s of marketing namely product, price, place, and promotions.  For product strategies, the manager decides upon the relevant product attributes that correspond to what the market needs and differentiate these from those offered by the competitors.  In this stage, the manager should already know what kind of product positioning he or she want to establish in the market place.  Consequently, manager then calculates and sets the appropriate price for the product.  In this stage, the manager determines the product cost and retail prices.  In determining the price of products, a manager would have to consider the product’s image or value in the eyes of the customer.  Consequently, the manager then identifies the distribution strategy, by analyzing and determining the appropriate distribution channels per channel or account.  The manager then formulates a promotions plan that includes advertising strategies and activities.  In each of the marketing mix elements, the manager makes use of well-organized templates and fields where data and information are imputed and processed.

Once the marketing mix has been determined, the manager then subjects the plan to the simulation phase.  In this stage, the manager receives constant feedback concerning the reactions and competitive environment in the simulated market place.  The feedback comes from customers, competitors, the regulators, and the other forces present in the simulated market place.  After assessing the feedbacks in relation to the marketing mix, the manager then makes the final marketing plan and submits it.  Subsequently, the marketing reports are then sent back to firms and the next cycle of marketing decisions, as prescribed by the TMG program, commences.

Throughout the TMG process, the manager is assisted on each of the market planning stages clearly and systematically.  This systematic, yet easy to use process applied in the TMG is enhanced using computer and Internet technology.  Furthermore, the player is assisted by built-in tools to generate illustrative aids such as graphs, charts, figures, diagrams, and other features to produce professional market reports.

Fundamentally, the iterative cycle inherent in the TMG module reflects the flexibility of the program.  In actual business situations, market trends are always in a state of flux.  Products and services change depending on the so many forces such as client preferences, technology, new inventions, economic instability, and so on.  Given this reality, the TMG trains users to be nimble, innovative, and multifaceted in terms of strategic thinking.  The range of factors and variables accounted for users playing the TMG are numerous indeed.  For example, on the aspect of competitor analysis alone, the user would have to consider the competitors past, present, and future strategies, their market positioning in various market segments, their financial performance, and a host of other factors.  Users playing the TMG would also need to conduct comparative analysis of competitors in matrix format comparing sales, products, sales representatives, market shares per channel, and a host of other variables.  Another example is the pricing strategy.  In this aspect, the user needs to consider such factors as production costs, investments in machinery and assets, economies of scale, as well as customer perception of the product’s value and image.

Meanwhile, product positioning strategies also require that a TMG player knows what makes his or her products superior to competitors and what kind of products fit into a particular customer segment.  Essentially, with so many variables and interrelationships to examine in the simulated market place, plus the fact that the system is designed to account for changes in the market place, users of the TMG are bound to develop in-depth, critical thinking skills.

Figure 1:  TMG Process Flow (Source:  Prof. A.J. Otjen, Montana State University College, 2009)

			Analysis of market situation/ opportunities
				Planning and budgeting
				Make marketing plan decisions
	Next period decision
				The marketing game simulation

Conclusion

The TMG strategy program offers corporate managers with a relevant, responsive and systematic approach to market planning and strategy.  The program is very much applicable in today’s uncertain, fast changing economic environment because it conditions managers to think strategically and critically.  In effect, the program reduces the danger of managers confining their analysis on just one or two elements of the marketing analysis, thereby allowing them to forge sound, detailed, and effective strategies.  Consequently, the program’s systematic process flow enables users to develop the marketing plan in its fullness, thus minimizing the risk of overlooking a key step in the market planning process.   Another significant feature of the TMG is that it is designed to accommodate game situations and therefore offers users with an exciting, challenging, and highly engaging market planning experience.

In the final analysis, the TMG is a valuable training and strategizing tool for managers examining the business landscape in the 21st century.  Amidst the current economic recession, managers need to be aided by tools that allow them to craft holistic marketing strategies effectively and swiftly.

Reference List:

Balakrishnan, P.V 2007.  “Marketing Laboratory BBUS 438,” A marketing presentation for the

Business Administration Program of the University of Washington

Otjen, A.j. 2009.  The Marketing Game! Viewed 9 April, 2009,

<http://www.msubillings.edu/businessfaculty/otjen/index2.html>

Porter, M 1985.  “Competitive Advantage:  Creating and Sustaining Superior Performance,” The

Free Press, A Division of Macmillan, Inc.

Part A: Forecast the financial statements
a) Discuss issues to consider when preparing projected financial statements (10 marks)

One of the major issues that the Compass group has to deal with is the currency exchange rates they have to deal with when reporting their consolidated financial statements. The company is currently using a fixed rate to be used as basis for the computation of the whole fiscal year. In order to shield to company from devastating currency losses, they have already engaged in currency swaps to protect the company’s interests.

There were also the exceptional items that happened several times throughout the last five years that the company has experienced. They are going to affect the financial analysis we have of the company’s previous performance as well as future prospects. This is the reason why the exceptional items are not included as part of the figures found in the financial statement. The items considered to be of exceptional nature were the sale of company’s assets as well as investing in new facilities of considerable amounts.

There are also different account principles being used by the company’s numerous subsidiaries throughout the world. The differences in the accounting rules are nevertheless reflected in the consolidated financial statements.
b) Forecast the consolidated income statement and the consolidated balance sheet for the year to 30 sep 2009 (40 marks)

Here are the forecasted financial statements of the company. The sales growth revenue percentage was determine first to be used as the basis for the computation of the rest of the items in the balance sheet.

The base year used was the year 2004 for calculations. Instead of growth rate, the company is expected to actually post a reduction in their sales. This is realistic since the current economy is already a dire situation plus the fact that the company has already been showing a reduction in their growth rates in the previous years. The first table above expresses the figures in actual numbers while the one below is shown in terms of the percentage that they are expected to be in the year 2009.

Note: The net income was taken from the net operating cash flow. The tax expense was taken from the balance sheet. The COGS was calculated by deduction as well as the net income. All other individual expenses were summarized in the COGS figure for simplicity.

The following figures are also forecast figures in the year 2009. The most conservative figures were chosen in order to reflect reality best in the dire economic situation that the rest of the world is in right now.

The following ratios were computed using the following set of data. They are derived from the balance sheet. The rest are assumed where needed.

The figures in pink are the ones that are forecasted to happen in the year 2009. The growth rate of the sales revenue was also used as the basis for the computation of the operating expenses. The rest of the items in the balance sheet are forecasted using the biggest possible expense or the lowest possible income. This is the manner by which the forecast is believed to be approximate to what the reality will hold since the economic situation is already dire. All percentages shown can then be used to derive the actual balance sheet items. They are not shown here as they are already part of the data computed in the cash flow analysis of the company to derive the amount needed for extra funding by other means.

Those figures that are expressed as percentage in relation to sales have been computed using a set of relevant data. There are some of them that are assumed to be the closest and most reasonable given the data by the company. The ratios expressed are naturally derived from the division of the indicated items directly.

From the forecasted financial data above, the following computation is done to arrive at the retained earnings of the company up to the forecasted year. The needed funding can then be ascertained from the above information. The amount needed to be borrowed is also determined by this analysis. The cash flow of the company can now be derived from the previous data to determine the future amount needed. Here is the derivation of the projected cash flow statements.

The cashflow derived is very simplified but it nevertheless includes all the essence in detailing the cash needed by the company in the year 2009 as derived from the data in the forecasted balance statements. The cash in the investing portion is assumed to be zero since it is not prudent for the company to continue making investments in these dire economic times. The cash from financing activities decreased by 10 since that is the amount of dividends paid regularly. There are no more cash raised through getting more debts as this might compromise the company’s positions. The projection however will tell us the amount of cash the company needs to raise through whatever means. The company will have an expected deficit of 8.942 million. This was derived by 944.942 from cash in operations minus 936 from cash needed in financing activities.

The company either needs to raise some stocks or negotiate a revolving credit line with their bank partner. This figure will be the basis on whether the public still has the appetite for buying bonds or stocks to this amount. This is also the amount that the bank has to consider whether the company still has the capability to pay despite the present economic conditions.
Part B: Write a report to the management of the compass group plc analyzing the predicted financial position and performance of the company and comment on the company’s financial strategy (50 marks)

The following financial statements are arranged to show the previous financial performance of the company as well as their future prospects. From the data displayed below, we can infer the right kind of strategy that the company needs to have in order to prosper in the future.

This is the income statement that will be used as basis for later analysis.

This is the balance sheet statement that will be used as the basis for later analysis.

This is the consolidated Cash Flow to be used as basis for later analysis.

The second 2008 figures are simply multiplied by 2 from the previous one since the company’s reports only includes six months figures. It is presumed that this will be the closest approximation of the financial performance of the company for the whole 2008 itself.

The following are the common size trends and time trends of the company. They will indicate the past performance as well as give us a clue as how the company will be faring in the future.

This is the common size analysis of the balance sheet. It is focusing on the assets with total assets used as basis for 100%. The rest are reflected according to their relative size.

We can see immediately that the company had a lot of significant intangible assets in the years 2004-2005 but drastically reduced in the following years. The drop is very sharp as you can see ranging from 69% to a sudden 2% in 2006. This must have meant a lot of conservative financing for the company later. The most interesting part is the 2004 which does not have any cash in their account except for the value of their physical properties, plant and equipments. The cash holdings of the company increased to a more comfortable level at the range of 30-33% after the year 2004.The current assets basically did not change drastically for four consecutive years.

This is the time trend analysis of the company’s assets. We can clearly see that the intangible assets of the company have dropped dramatically from the time of 2005. This can be seen already in the common size analysis but the time trend also confirms it. Aside from the year 2005, the year 2006 still has a considerable amount of assets as compared to the rest of the succeeding years after it. The asset size decreased from 120% to a sudden 106 % only in comparison relative to the year 2005 as basis. The years 2007 and 2008 have a fairly stable amount of assets indicating stable performances. On a more detailed analysis, the tangible investments of the company increased in 2007 and 2008. Their intangible investments are left alone as this does not have a marked effect on the company’s performance. The receivables of 2008 on the other suddenly went double that of the year 2006 indicating the increase of credit given to customers and an increase in sales.

This common size trend analysis was done using the equity as the basis for the computation.

The most obvious information you can get right away is the short term borrowings of the company in the year 2005. They are significantly huge since they have to practically start the company operating from scratch. It has since then dropped considerably to about 4-6 percent with the succeeding years. The same goes for long term borrowings. The company made a substantial borrowing in the year 2004 at the level of 187% compared to the 64% something that the company has since then maintained in the years 2007. This simply indicated that their previous investments have already been paid and that they have now stabilized the income for the company’s operations.

This time trend analysis used the year 2006 since it is the only one with a complete set of figures that are verifiable. The short term borrowings saw a small bump at the rate of 126% and then returned to state near that of 2006 in the form of 93%. This only meant that the company has encountered additional investment needs aside from the substantial amount that they have already borrowed in 2005. The operations have remained fairly stable after this. The equity of the company has also decreased noticeably from the year 2006 to around 75-83% only. This has either been because of stock issuance or the reduction in owner’s equity since the company has now shown to be fairly stable in its earnings.

The following financial ratios are computed and arranged by year to show the company’s financial position. This is also to gain an understanding of what will be the best strategy the company should take.

The most striking information that you can get in the financial ratios is the profit margin of the company. The company has already been in the negative zone when it comes to their profit margin. This was because of a substantial investment in the years 2004-2005. It did become gradually smaller as the years passed by but it is still negative in the year 2009. The company has to be careful with their finances if they want to survive the current depression affecting the whole world. Another indicator of poor performance is the return on assets by the company. They had never been able to post a rate of above 10%. The returns on the assets are all within 2-8% only. This is very small indeed considering that the company has to make substantial investments in order to run the operation. The small margin in the food industry leaves very little room for mistake. Even the net operating income of the company has a very sharp reduction in their figures in the year 2009. It is almost smaller by four times literally. Even if the company does not take into account the year 2009, the previous years are still showing a decrease in the NOI.

Another danger sing is the debt to equity ratio of the company. It has risen recently from an insignificant 08 to 2.0 level. This only means that the company is in dangerous grounds.

The rest of the other ratios like the current ratio and the cash ratios have remained more or less stable. These are only due to the varying conditions that a business can normally encounter. The rest of the details are better indicators of the company’s performance.

Naturally, there are no receivable ratios since the company sells the food on a cash basis. There are no items sold on credit. This is one thing that is advantageous for the company’s operation. It actually lessens the chances of being short on cash on their daily operation. In a long term sense, the company is also far away from danger since they don’t have to contend with the long waiting time needed to make use of the sale they had commenced. The company does not have to wait for the cash to be cleared in their names. The time trend and the commons size analysis confirm this also. The company has already made a substantial investment at the start. They are only slowly starting to regain their investments. This is no time to be extravagant.

The strategy that the company has to take this time is one of a very conservative and prudent type of actions. There should be no additional investments. The debt should be paid as little as possible to conserve cash. All expenses should be reduced. There should be no credit extended to customers as this might compromise the company’s own cash reserves. Considering there are numerous signs for danger to the company in combination with the adversarial economic conditions right now, the company should stay away from all kinds of speculative actions. There should be no expansion of the company’s operation whatsoever. If possible, the company should wait again until they have cleared all debts before thinking of expanding again. This is to ensure that the company will survive despite tough economic times.

Corporate Governance

Corporate governance is a continuous process of monitoring corporate activities. The monitoring process is strategic in nature. This is directed towards both the internal and external matrices of operation of the organization with a stronger focus on the later. The principle and practices of corporate governance varies over geographic regions. The fundamental monitoring and controlling aspects of corporate governance in general follow this country specific variation.

Corporate governance is getting phenomenal importance due to changing economic environment of business.  Organizational expansion highly depends on financing. The existing or new sources of finance demands operational transparency from the organizational side. So a monitoring and possible controlling system has been originated to address the problem.

Corporate governance focuses on the relational sides of value creation, increase and maintenance of the shareholders’ interests. The word shareholder is used here in a more generalized sense.  Without bounded only to equity shareholders, it is used in a generic sense to capture the entire group of institutions and group of people with some positive interests in the organization. The risk management domain of corporate governance tries to minimize the negative effects on the organization. (”A Closer Look at Business Education”, 2006)

The corporate governance of an organization in general consists of the high power board of the organization, audit committee, section dedicated to investor relationship, executive committee, section responsible for compliance and internal commitment management.

The board of the organization is the centralized powerhouse of the organization for all important decision making activities. Since organizational decision making capacity will affect all, the true distribution and use of power is extremely important in the composition of the board.  Construction of a board with equitable distribution of authority is the most demanding parameter in this context. Most of the high level corporate conflicts have a common root, -non unanimity regarding the structure of the board.

Audit committee looks after the risk aspects of the organization. Risk exposure to an organization is multidimensional in nature.  An organization is susceptible to risks from both inside and outside. Audit committee is responsible for detection, measurement and control of risk. It is important to note that conventional financial audit is just a part of modern integrated risk management framework. Competence and neutrality is the two main characteristics of a result oriented audit committee.

Investor relationship is one of the primal activities of corporate governance. Investors can be institutional or ordinary. Big institutional investors have considerable influence in the organization. Long-term success of an organization highly depends on the success of managing investor relationship.

The internal liability management (like pension) also comes under the area of corporate governance. The long-term success of an organization is highly correlated to the efficiency and transparency of its corporate governance.

Stakeholders’ Engagement

The structural difference in corporate governance can help in the comparative study between two companies active in similar business areas. The Tesco and The Mark and Spencer’s (henceforth M &P) are two well-known retail giants operating globally. The comparative study on this will focus mainly on their difference in corporate governance and its impact in future investors’ interests.

The corporate governance in Tesco has the following components. The Tesco board is consists of seven executive directors, seven non-executive directors and senior executive deputy director. The chairman is responsible for the smooth running of the board. The chief executive is responsible for the overall performance of the company. The independence of the non-executive directors is important to balance the power equation in the board. Board responsibility includes resolution of the problems through meetings; ensure the quality of the newly appointed directors through training and development. The board process includes the nomination, remuneration, audit committee and executive committee. The nomination committee looks after the appointment, re election and succession of the directors.  Rumination committee sees the rumination related to executive directors. Audit committee is responsible for the overall risk management of the firm. One of the special characteristics of this committee is that, the membership is strictly limited to non-executive directors. This is an attempt to ensure neutrality in operation. There is a system to evaluate the performance of the board. The executive committee is responsible for the strategy formulation, evaluating and monitoring of the company. This committee can work only after informing the board about their activities. Integrated audit and risk management, investor relationship management are the other activities under corporate governance.

Due care has been taken to maintain the non-centralization of power. This balance is essential for the proper functioning of the organization. M &P is also retail giant with considerable structural similarities with Tesco. The composition and basic characteristics of corporate governance are defined in company law. Despite this common legal structure, firms can have considerable differences in the structure of the high power board. A number of corporate bylaws can be used to bring change with a motive to imbalance the power equation in the board. This motive can be seen as a shock to accountability and transparency in operation of the organization. The basic reason behind the existence of these bylaws is to handle some exceptional situation.  So any deviation from the expected corporate structure should be analyzed with the possible motive or reason

There is a wave of criticism regarding the selection of Sir Ross at the post of chairman and executive director at M & P.  Sir Ross was appreciated for his strategic leadership to ward off hostile takeover of M &P in time of its adversity. The very recent financial performance of M&P is not encouraging.  The criticizers are saying that the possible fall in profit over 40 % (Craven, 2009) is a poor indication to leadership. So they are against of this motive. Mere financial performance must not be the cause of concern in this regard. Company law, in general prohibits the simultaneous holding of two posts at the board of a company. The executive board is responsible for the performance of the company. Chief executive Director heads this side of the board. The chairman sees the smooth running of the board. The non-executive directors are on independent charge. This clause is important to maintain their neutrality in opinion about the company. This side of the board looks after shareholders’ interest. So the membership to the non-executive side demands seclusion from very personal interests in the firm. Simultaneous membership in both sides of the board affects the expected neutral feature of the board. Many decisions have mutually exclusive interests to shareholders and the executives. (This is known as the agency problem, in light sense) The board is constituted to address the interest of the both groups. The ability of the board to address this dual problem gets crippled in the aforesaid case.

Overall Comments

An investor must be aware of the dynamics of corporate governance of the firm, where s/he invests. Transparent corporate governance is the indication of better protection of shareholders’ interest.

Both the companies Tesco and M&P are well diversified retail giants with well coverage of market. Diversification of services, product pricing and advertising strategies is strategically designed to maximize the possible market penetration.  Tesco is relatively more diversified as M&P is little more concentrated in garment sector. Diversified retail firms can out perform the market due to their highly differentiated portfolio of services. Recent performance of Tesco shows a change in earning per share rose from 22.36 to 26.95.  M&P shows a change from 39.1 to 48.2 i.e. a 20.52 %rise for Tesco and 23.27 % rise for M&P. Although M&P shows a better EPS, yet its performance not as consistent as Tesco (M & S, 2008; Tesco, 2008) The most important warning that goes against M&P is the already discussed present dubious and objectionable practice of corporate governance.  This initiates strong opposition from influential institutional investors. This can seriously affect the company.

Tesco has shown remarkable consistency in performance. M&P is not that much consistent in its performance. Tracking of dividend declaration shows this clearly. Despite the high EPS, there is a recent possible profit warrant in M&P. This shows the fundamental strength of Tesco is more than that of M&P. M&P was initially oriented to quality rather than price. There is a recent change in this strategy. Although it tries to project its price sensitive image yet Tosco is well ahead in this field.   M&P was under the threat of hostile take over. This shows the extreme level of poor risk management capacity of the firm. Risk management is an integral part of corporate governance. This shows another side of weak practice of corporate governance at M&P. The company with a recent history of possible hostile take over cannot be recommended to an investor with moderate risk appetite. The above discussion says that Tesco is a more transparently managed, fundamentally stronger company with consistently good performance than M&P. Poor risk management and resent controversy over the structure of the company board make M&P an opaque investment option as opaque as the practice of its corporate governance.

References

1. “A Closer Look at Business Education”, (2006), Business Society Program, The Aspen Institute, available at: http://www.beyondgreypinstripes.org/pdf/CGReport.pdf (accessed on March 27, 2009)
2. Craven, N. (2009), Rose heading for revolt over profits plunge, Mail Online, available at: http://www.dailymail.co.uk/money/article-1163770/Rose-heading-revolt-profits-plunge.html (accessed on March 23, 2009)
3. M & S, (2008) Annual report and financial statements 2008, available at: http://annualreport.marksandspencer.com/financials/con_income_statement.html (accessed on March 27, 2009)
4. Tesco, (2008) Summary Review and Summary Financial Statements 2008, available at: http://www.tescoreports.com/areview08/investor.html (accessed on March 27, 2009)