Month: September 2017
Person who Changed my Life
My Father- The Person Who Has Influenced Me in My Life
Right from the word go , he has been my inspiration . A man with immense wisdom and advise , my father has made me what I am to day . He is the linchpin of my success in my life . My father is a very hard-working person and one who values education in one 's life . Being a teacher by profession , I was really touched with the way he used to concentrate all his efforts in making his students pass . This also made me to follow his footsteps by working extremely hard in school . He also encouraged and advised me to work even harder , telling me that the sky was the limit . Today , I am convinced that with the course am pursuing , I would get a very good job out of it .
My father is a person with a lot of respect for both his elders and younger ones . All along my entire lifetime , I have seen the sober manner in which he settles domestic scores and reprimanded us when we erred . In both cases , consultations and dialogue were the key traits that guided him . This has taught me the importance of tolerating other people 's injustices and seeking for consultations in times of difficulties . As a consequence , I have been able to live harmoniously with both friends and foes . My moral decorum and uprightness is all owed to my father He always warned me against engaging in immoral activities. Being a humble and down-to-earth person , my father ensured that we were like him . I leant the need of swallowing one 's pride whenever success knocks the door . Instead , forgetting the past success and working even harder isthe motto .
The word Love sounds little but few people understand what it really means to love . It is a trait that cannot easily be self cultivated in an individual person . It can only be shown in a person and the person would also show it onto others in return . It is a trait that my father had and still possesses . It has enabled me to extend my love to all who associate with me in one way or another . I believe in doing things early and fast in life . This is something that I learnt from my father . I remember his most favorite saying that , and I quote ``the early bird catches the warm ' Then the question is how has this saying helped me to be what I am and where I am ? Because of the enthusiasm to accomplish things /works early in life , I was able to finish finish both my education at the most appropriate times . It is my father who cultivated in me the culture of disliking drug abuse.
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Person Who Changed My Life. (2017, Sep 21).
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Random Number Table
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Random Number Table. (2017, Sep 21).
Retrieved November 5, 2025 , from
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The Iceberg Theory in the Old Man and the Sea
In business, organization structure means the relationships between positions & people who hold the positions. Organization structure is very important because it provides an efficient work system as well as a system of communication. First of all we should distinguish between the organizing function & organizing structure.
The organizing function is the process of breaking down the overall task into small jobs along with delegated authority to do those jobs & then putting them back together in units, or departments, of an optimal size according to some consistent bases. Thus we can describe the organizing function as dividing task into jobs, delegating authority, determining appropriate bases for departmentalizing jobs, & deciding the optimal number of jobs in a particular department. It helps to coordinate effort & create authority relationships. Organizing structure is considered by many to be “the anatomy of the organization, providing a foundation within which the organization functions”. So the idea of a structure is a frame work – differentiation of position, prescriptions of authority. So structure helps to regulate the behavior of employees. There are can be different kinds of organization structure, & firms can change their organization structure by becoming more or less centralized. Most organization have a hierarchical or pyramidal structure, with one person or a group of people at the top, & increasing number of people below them at each successive level. There is a clear line or chain of command running down the pyramid. All the people in the organization know what decision they are able to make, who their superior (or boss) is (to whom they report), & who their immediate subordinates are (to whom they can give instructions). This structure is one of the simplest & it’s also called a line structure.
Some people in the organization have colleagues who help them: for example, there are might be an Assistant to the Marketing Manager. This is known as a staff position: its holder has no line authority, & is not integrated into the chain of command, unlike, for example, the Assistant Marketing Manager, who is number two in the marketing department.
This structure is known as a staff structure. Yet the activities of most companies are too complicated to be organized in a single hierarchy. Shortly before the First World War, the French industrialist Henry Fayol organized his coal-mining business according to the functions that it had to carry out. He is generally credited with inventing functional organization, including (among others) production, finance, marketing, sales, & personnel or staff departments. The functional type of organization structure reflects an arrangement based on the nature of the activities that must be performed. Related activities are grouped together in the functional areas with which they are most clearly identified. The chief executive of each area occupies a position on the second level of the organization & generally has the title Vice-President.
This means, for example, that the production & marketing departments cannot take financial decisions without consulting the finance department. The functional structure allows for coordination of related activities, thereby reducing the risk of empire building by specialized areas & resulting in greater efficiency. The structure’s most distinguishing feature is that staff managers may have line (functional) authority for their particular activities. But in a functional structure the request could be an order. As I’ve already said the functional structure is efficient, but there are two standard criticisms. Firstly, people are usually more concerned with the success of their department than that of the company, so there are permanent battles between, for example, finance & marketing, or marketing & production, which have incompatible goals.
Secondly, separating functions is unlikely to encourage innovation. An inherit problem of hierarchies is that people at lower level are unable to make important decision, but have to pass on responsibility to their boss. One solution to this is matrix management, in which people report to more than one superior. For example, a product manager with an idea might be able to deal directly with managers responsible for a certain market segment & for a geographical region, as well as managers responsible for the traditional functions of finance, sales & production. This is one way of keeping authority at lower levels, but it’s not necessarily a very efficient one. Thomas Peters & Robert Waterman in their book “In search of Excellence” insist on the necessity of pushing authority & autonomy down the line, but they argue that one element – probably the product – must have priority; four-dimensional matrices are far too complex. A further possibility is to have wholly autonomous, temporary groups or terms that are responsible for an entire project, & are split up as soon as it is successfully completed.
Terms are often not good for decision-making, & they run the risk of relational problems, unless they are small & have a lot of self-discipline. In fact they still require a definite leader, on whom their success probably depends. In matrix & geographical structure decentralization plays the key role. & it has its advantages & disadvantages. Advantages of decentralization: 1. It encourages managers to develop their decision-making ability, training for promotion into position of greater authority & responsibility. 2. It creates competitive climate. Managers can be compared with each other that make them to be more productive. 3. Managers have more freedom so they can be involved into solving different problems, so they become more creative. Many organizations choose to follow decentralization of authority. But it also has disadvantages: 1. It needs more intensive & expensive management training.
Managers must be retrained for making decisions of high-level. 2. It needs more sophisticated planning & reporting methods, especially for upper management, because the flow of information to upper managers increases. 3. Top managers should delegate a portion of their decision-making job to middle & 1st level managers, but sometimes they can be unwilling & unable to do it.
• Every company is structured differently, and every structure provides its own unique benefits. Understanding what goes into the development of these structures and how they operate will help you to better navigate the structure you’re in, or select the right one for the company you are in the midst of creating. Functional
• A functional or traditional structure is one of the oldest structures utilized in businesses. It is the epitome of the “top-down” view of organizational structure. In functional structure, people are grouped together because they perform the same kinds of tasks with the same kinds of skills towards the same kinds of goals.
For example, all of the copywriters in a publishing company would be sectioned off from all of the visual artists. Divisional
• A divisional structure melds together the groups in a functional structure into separate, self-sufficient work units. Each unit will have enough individuals with varied skills to work on one component of the overall organization’s goals. For example, one unit might focus on marketing one product, and have a copywriter, a visual artist, a public relations liason and a web programmer working together. Federations
• Federation style organization structures are a spin-off of divisional structures in a macro sense.
With this kind of structure, units in an organization do not work together. Instead, different companies form a federation of sorts where each individual company is accountable for one component of a goal. For example, a production, distribution and marketing company may work together under contract of an umbrella company, forming a system of independent but interlinked groupings working toward a common goal. Matrix
• A matrix structure is a hybrid of the functional and divisional structures. In this structure, a management team will select participants from functional units to operate in a divisional manner. In other words, individuals working in different capacities will be brought together to work toward a common goal. Flat
• One of the newer forms of organizational structure is a flat or cooperative form of organization. In this, the the common conceptualizations of “top-down” management are put aside in favor of a more team-oriented atmosphere. While individuals will still assume levels of leadership, the structure encourages a feeling of collective ownership, with each individual being accountable for the performance of all participants.
Interconnected characteristics of a market, such as the number and relative strength of buyers and sellers and degree of collusion among them, level and forms of competition, extent of product differentiation, and ease of entry into and exit from the market. Four basic types of market structure are (1) Perfect competition: many buyers and sellers, none being able to influence prices. (2) Oligopoly: several large sellers who have some control over the prices. (3) Monopoly: single seller with considerable control over supply and prices. (4) Monospony: single buyer with considerable control over demand and prices. LINE AND STAFF STRUCTURE ORGANIZATION Staff authority is used to support the line authority. Line authorities are more involved in the core activities of the business. They have little time to analyze all information for many decisions. They do not have expertise in all technical areas. Staffs are specialists, who help line authority in discharging their duties.
For example, a production manager (a line authority) does not have enough time and experience to handle labor relation problems. Staffs (who are specialists) help them in doing so. Line and staff organizations have both line and staff executives. Line executives are assisted by staff specialists in R & D, planning, distribution, quality, legal, audit, public relations, etc. The job of staff is mainly advisory and guidance. Line executives maintain the supervisory power and control over the execution of work. Factors Affecting Organizational Design Although many things can affect the choice of an appropriate structure for an organization, the following five factors are the most common: size, life cycle, strategy, environment, and technology. [pic] Organizational size The larger an organization becomes, the more complicated its structure.
When an organization is small — such as a single retail store, a two-person consulting firm, or a restaurant — its structure can be simple. In reality, if the organization is very small, it may not even have a formal structure. Instead of following an organizational chart or specified job functions, individuals simply perform tasks based on their likes, dislikes, ability, and/or need.
Rules and guidelines are not prevalent and may exist only to provide the parameters within which organizational members can make decisions. Small organizations are very often organic systems. As an organization grows, however, it becomes increasingly difficult to manage without more formal work assignments and some delegation of authority. Therefore, large organizations develop formal structures. Tasks are highly specialized, and detailed rules and guidelines dictate work procedures. Interorganizational communication flows primarily from superior to subordinate, and hierarchical relationships serve as the foundation for authority, responsibility, and control.
The type of structure that develops will be one that provides the organization with the ability to operate effectively. That’s one reason larger organizations are often mechanistic—mechanistic systems are usually designed to maximize specialization and improve efficiency. Organization life cycle Organizations, like humans, tend to progress through stages known as a life cycle. Like humans, most organizations go through the following four stages: birth, youth, midlife, and maturity. Each stage has characteristics that have implications for the structure of the firm.
• Birth: In the birth state, a firm is just beginning. An organization in the birth stage does not yet have a formal structure. In a young organization, there is not much delegation of authority. The founder usually “calls the shots.
• Youth: In this phase, the organization is trying to grow.
The emphasis in this stage is on becoming larger. The company shifts its attention from the wishes of the founder to the wishes of the customer. The organization becomes more organic in structure during this phase. It is during this phase that the formal structure is designed, and some delegation of authority occurs.
• Midlife: This phase occurs when the organization has achieved a high level of success. An organization in midlife is larger, with a more complex and increasingly formal structure. More levels appear in the chain of command, and the founder may have difficulty remaining in control. As the organization becomes older, it may also become more mechanistic in structure.
• Maturity: Once a firm has reached the maturity phase, it tends to become less innovative, less interested in expanding, and more interested in maintaining itself in a stable, secure environment. The emphasis is on improving efficiency and profitability.
However, in an attempt to improve efficiency and profitability, the firm often tends to become less innovative. Stale products result in sales declines and reduced profitability. Organizations in this stage are slowly dying. However, maturity is not an inevitable stage. Firms experiencing the decline of maturity may institute the changes necessary to revitalize. Although an organization may proceed sequentially through all four stages, it does not have to. An organization may skip a phase, or it may cycle back to an earlier phase. An organization may even try to change its position in the life cycle by changing its structure. As the life-cycle concept implies, a relationship exists between an organization’s size and age. As organizations age, they tend to get larger; thus, the structural changes a firm experiences as it gets larger and the changes it experiences as it progresses through the life cycle are parallel.
Therefore, the older the organization and the larger the organization, the greater its need for more structure, more specialization of tasks, and more rules. As a result, the older and larger the organization becomes, the greater the likelihood that it will move from an organic structure to a mechanistic structure. Strategy How an organization is going to position itself in the market in terms of its product is considered its strategy. A company may decide to be always the first on the market with the newest and best product (differentiation strategy), or it may decide that it will produce a product already on the market more efficiently and more cost effectively (cost-leadership strategy). Each of these strategies requires a structure that helps the organization reach its objectives. In other words, the structure must fit the strategy. Companies that want to be the first on the market with the newest and best product probably are organic, because organic structures permit organizations to respond quickly to changes. Companies that elect to produce the same products more efficiently and effectively will probably be mechanistic.
Environment The environment is the world in which the organization operates, and includes conditions that influence the organization such as economic, social-cultural, legal-political, technological, and natural environment conditions. Environments are often described as either stable or dynamic.
• In a stable environment, the customers’ desires are well understood and probably will remain consistent for a relatively long time. Examples of organizations that face relatively stable environments include manufacturers of staple items such as detergent, cleaning supplies, and paper products.
• In a dynamic environment, the customers’ desires are continuously changing—the opposite of a stable environment. This condition is often thought of as turbulent. In addition, the technology that a company uses while in this environment may need to be continuously improved and updated. An example of an industry functioning in a dynamic environment is electronics. Technology changes create competitive pressures for all electronics industries, because as technology changes, so do the desires of consumers. In general, organizations that operate in stable external environments find mechanistic structures to be advantageous.
This system provides a level of efficiency that enhances the long-term performances of organizations that enjoy relatively stable operating environments. In contrast, organizations that operate in volatile and frequently changing environments are more likely to find that an organic structure provides the greatest benefits. This structure allows the organization to respond to environment change more proactively. Technology Advances in technology are the most frequent cause of change in organizations since they generally result in greater efficiency and lower costs for the firm. Technology is the way tasks are accomplished using tools, equipment, techniques, and human know-how. In the early 1960s, Joan Woodward found that the right combination of structure and technology were critical to organizational success. She conducted a study of technology and structure in more than 100 English manufacturing firms, which she classified into three categories of core-manufacturing technology:
• Small-batch production is used to manufacture a variety of custom, made-to-order goods.
Each item is made somewhat differently to meet a customer’s specifications. A print shop is an example of a business that uses small-batch production. Mass production is used to create a large number of uniform goods in an assembly-line system. Workers are highly dependent on one another, as the product passes from stage to stage until completion. Equipment may be sophisticated, and workers often follow detailed instructions while performing simplified jobs. A company that bottles soda pop is an example of an organization that utilizes mass production.
• Organizations using continuous-process production create goods by continuously feeding raw materials, such as liquid, solids, and gases, through a highly automated system. Such systems are equipment intensive, but can often be operated by a relatively small labor force.
Classic examples are automated chemical plants and oil refineries. Woodward discovered that small-batch and continuous processes had more flexible structures, and the best mass-production operations were more rigid structures. Once again, organizational design depends on the type of business. The small-batch and continuous processes work well in organic structures and mass production operations work best in mechanistic structures.
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The Iceberg Theory in the Old Man and the Sea. (2017, Sep 21).
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Pink Floyd Paper
Dark side of the moon review The album that I chose to review for this project is my favorite Pink Floyd album, Dark Side of the Moon. Pink Floyd is a four piece psychedelic rock band that originally consisted of Roger Waters on the bass guitar and vocals, Nick Mason on the drums, Richard Wright on the keyboard and backing vocals, and Syd Barrett on vocals and guitar who was eventually replaced with the legend that is David Gilmore. The album was recorded in June 1972 – January 1973 at the Abbey Roads Studios in London England. This was Pink Floyds sixth studio album eighth overall and was released in March of 1973 and was a great success “Topping the billboard charts for one week it remained on the charts for 741 weeks…. With an estimated 45 million copies sold. ” (Wikipedia) Pink Floyd is a Psychedelic rock band that came out of Cambridge, England in 196574. he band began playing covers of old American Rhythm and Blues songs until Syd Barrett, their original guitarist, began writing songs and moved the group into the psychedelic rock movement. Pink Floyd said they were influenced by Jimi Hendrix because of the way that he experimented with different sounds and improvised on the guitar. They also were heavily influenced by a band called Can who helped start the psychedelic movement in Europe. Pink Floyd fits well in progressive rock and psychedelic rock genre because they incorporate a lot of different sounds and use many effects in the music they play. They try to replicate and or enhance the effects of mind altering drugs which were very popular during the late 1960’s and 70’s, this is shown in the song “on the run” where there is a lot of different effects and sounds that may confuse the conventional rock listener. They have also been said to fit in the progressive rock genre because they pushed the boundaries with their music and went beyond the classic verse-chorus based song structures. Pink Floyd always pushed their music but dark side of the moon was the first time that they went all out using multi track recording, tape loops, and analogue synthesizers which gave it the very unique “pink Floyd sound” and was the most technically advanced way to produce an album at the time. It was their eighth album and helped introduce a lot of people to their music. The song that helped sell the album was the sixth track “Money”. Money was very unique compared to the other music of the time because it started off with the sound of money hitting the ground and was not on a conventional 4/4 time but a 7/4 because of the double tracking. Fans had never really heard music put this way and really took well off it. Even though this album was released late in their career many fans consider it the beginning of the real Pink Floyd era. I believe Dark Side of the Moon falls really well in the psychedelic genre because of the unique way they made the album. The album is a whole entity in that to its hard to just take out one or a few songs because you wouldn’t be able to grasp what they were trying to present to you. With that being said I chose the songs that I believe were the most unique because they pushed the boundaries of music at the time by incorporating many different kinds of producing techniques and helped people get introduced to the album. The first song on the album “ Speak to me” is a great example of what is to come on the rest of the album and shows off the different producing effects they used like the over dubbing of cash registers which is a foreshadowing of what is to come later on in the album in the song Money. The song starts off with a man arguing with someone about how he can’t explain his anger then transitions to people laughing and a person screaming in the distance and grows louder and louder until the synthesizer takes over and the band enters into “ Breathe”. People generally say that these two songs should have been put into one five minute song but it would have changed the feel of the song. This song shows off David Gilmour’s slide guitar and lead vocals in his gentle and warm timbres. The lyrics were written by Roger Waters and he tries to make the listener take notice of the smaller things in life which is different than what people generally see life as which is just to work. The song goes off of a 4 bar measure and has a slow tempo. The song ends abruptly because it is followed immediately by the song “on the run”. The next song that I’m going to be evaluating is the song “money”. The song starts off with the sound of cash registers opening and closing which are full of change. They keep a very good harmony during the whole song with the use of different instruments like the tenor saxophone, slide guitar, synthesizers, and piano. The song’s lyrics say that money rules the world and that a person’s social class is determined by how much money they have. It says that money is the root of all evil and so you should share it with people but when you ask they never give you any. Dark Side of the Moon has gone on to be one of Pink Floyds most successful albums and has had a profound effect on other musicians like Phish and David Bowie, and has also been tied to the Wizard of Oz controversy. All in all it was and always will be a landmark in Psychedelic rock.
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Pink Floyd Paper. (2017, Sep 21).
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Aids and Role of Youths to Create Awarness
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Aids and Role of Youths to Create Awarness. (2017, Sep 21).
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A Primary Task of the Manager
Decision Making- A Primary Task of the Manager
As the term implies, decision making is the process of selection of a course of action from among alternatives. All decisions made in an environment of at least some uncertainty. However, the degree will vary from relative certainty to great uncertainty. There are certain risks involved in making decisions. In a situation involving certainty, people are reasonably sure about what will happen when they make a decision. The information is available and is considered to be reliable, and the cause and effect relationships are known. In a situation of uncertainty, on the other hand, people have only a meager database, they do not know whether or not the data are reliable, and they are very unsure about whether or not the situation may change. In a risk situation, factual information may exist but it may be incomplete.
To improve decision making, one may estimate the objective probabilities of an outcome by using, for example, mathematical models. On the other hand, subjective probability, based on judgement and experience, may be used. Fortunately, there are a number of tools available that help managers make more effective decisions. All intelligent decision makers dealing with uncertainty like to know the size and nature of the risk they are taking in choosing a course of action. One of the deficiencies in using the traditional approaches of operations research for problem solving is that many of the data used in a model are merely estimates and others are based on probabilities. The ordinary practice is to have staff specialists come up with “best estimates”. However new techniques have been developed that gives a more precise view of risk. Virtually every decision is based on the interaction of a number of important variables, many of which have an element of uncertainty but, perhaps,a fairly high degree of probability. Thus, the wisdom of launching a new product might depend on a number of critical variables the cost of introducing the product, the cost of producing it, the capital investment that will be required, the price that can be set for the product, the size of the potential market, and the share of the total market that it will represent.
Manager’s main job is decision making and quite often they have to decide on what is to be done, who is to do it, when, where, and so on and so forth. The first step in decision making after having decided our goals and our planning premises is to develop all the possible ways of reaching the goals. If one thinks hard enough more than one way to achieve the goals can be identified. If you cannot find more than one way to the goals then I would say probably you have not thought hard enough. This is because almost always alternatives exist. There is a good statement I remember on this occasion-I quote the unknown “ If there seems to be only one way of doing a thing, that way is probably the wrong way. ” Now you can understand the limitations and boundaries within which the manager has to act. On the way to achieving the desired goals there would be more often than not something that would stand in the way, obstructing the path. This something that stands in the way accomplishing a desired goal is a limiting factor. The principle of limiting factor states as follows: By recognizing and overcoming those factors that stand critically in the way of a goal, the best alternative course of action can be selected.
Steps In Decision-making Process Let us now look at the process of decision making. Having found many alternatives to the goal, the next logical step is to decide and select one of them for adoption. Obviously, you need to evaluate them find the most appropriate one for implementation. In evaluating the alternatives, the managers are likely to do so:
Quantitative Factors–
1. The factors that can be measured in numerical terms,
2. Qualitative Factors–factors that are intangible and difficult to measure numerically,
3. marginal analysis–that is to compare additional revenues arising from additional costs
4. cost effectiveness analysis–the process of selecting the best ratio of benefits and costs. After having evaluated the alternatives the job is to select one of them.
Here the managers can use three basic approaches:
1. Experience,
2. Experimentation, and
3. Research and analysis Experience There seems to be no greater teacher than experience. But what is experience? It is not the number of years spent in a business. Many managers do not learn by their mistakes. If so what is the benefit of experience? Mostly managers either do not or fail to identify the cause for their failures. Another facet is the lessons of experience may be entirely inapplicable to the new problems. Experimentation Experiments are one way of testing a method. It is probably the most expensive one. Besides, unlike in science, there is no guarantee of repetition of the results. But one should be encouraged to do experiments-to try the various alternatives and see which is best. In view of the high cost involved, I suggest it should be used only after considering other alternatives and its implications. Research and Analysis When a major decision has to be taken, research and analysis is the most effective technique.
One of the most comprehensive research and analysis approaches to decision making is operations research. We will discuss the same in detail at later. Types of Managerial Decisions As a manager one would need to take decisions under different situations. We can separately identify two different kinds of decision making situations. The kind of decision used for routine and repetitive work and the other is new, unexpected and non-repetitive one. The earlier one is termed as programmed decision and other non-programmed decision. You should understand that the decisions are not always necessarily be either of the two; it can be a combination of both. Most of the strategic decisions however, are non-programmed decisions and involve a certain amount of risk. Before a non-programmed decision is made the manager should calculate the amount of risk involved in the decision known as Risk Analysis, look at the major alternatives available-Decision Trees. The decision made by the manager would also be dependent on his attitude towards risk taking and this is called preference theory or utility theory. Decision making support systems use modern day gadgets and techniques to help the manager arrive at a decision effectively. Management invariably encounters situations in which uncomfortable decisions must be made. In some cases, the difficulty may be that, although certain alternative choices are clear, the consequences of these choices are not readily apparent. One possible tool for a manager in such a situation is decision tree analysis. A decision tree is a graphical diagram consisting of nodes and branches. The nodes are of two types. The first is a rectangle that represents the decision to be made.
The branches emanating from decision nodes are the alternative choices with which the manager is faced. One and only one alternative can be implemented. The second type of node is a circle. Circles represent chance nodes. That is, the alternatives emanating from chance nodes have some element of uncertainty as to whether or not they will occur. The primary benefit of a decision tree is that it provides a visual representation of the choices facing the manager. Analytic Considerations The first task of the manager is to identify the decision that needs to be made based upon a given situation. Next, the manager must think of all the possible alternative actions that could be implemented which would "solve" the problem. These alternatives are connected to the decision node as straight lines emanating from the node. The next step is to identify all the possible consequences that could occur as a result of an alternative being implemented. This process is accomplished for each and every alternative action identified in the previous step. Since these consequences have some element of uncertainty as to whether or not they will occur, the manager needs some way in which to evaluate the likelihood that they will (may) occur. The end goal is to obtain probabilities as to the likelihood of each consequence occurring. The best process to obtain these probabilities is to use past experience of similar outcomes. But, often there is no past experience of similar outcomes available to the manager. In these cases, the best tool is to utilize the collective wisdom of experts as to how likely it is that the particular consequence will occur in the future. Using an appropriate consensus building technique, estimates from a panel of experts can be combined or averaged to create a probability of the likelihood of the occurrence of each and every consequence. The only requirement is that the sum of the probabilities of the set of consequences emanating from a chance node must equal one. The next step is to evaluate the end result of each possible alternative in concert with the consequences identified for each alternative. This step results in a monetary figure that would be obtained if this course of action were implemented. This step is accomplished for each possible alternative. Finally, the entire tree is evaluated by employing a technique known as mathematical expectation in order to select the most beneficial alternative. Product Planning at Gerber Gerber Products, Inc. , the well-known baby products company, recently used decision tree analysis in deciding whether to continue using the plastic known as poly-vinyl chloride or, more commonly, PVC.
The situation involved a number of organizations including the environmental group Greenpeace, the U. S. Consumer Products Safety Commission, the toy and plastics industries, and the general public. PVC is a composite plastic material used in numerous household, commercial, and medical products including food storage containers, toys, and medical tubing. To make PVC soft and pliable, a chemical plasticizer known as "phthalates" is added to soften the plastic. In the latter half of 1998, Greenpeace announced that it had conducted scientific testing on phthalates and found them to be carcinogenic in lab rats. Further, Greenpeace claimed that the chemical leeches from the plastic over time and voiced particular concern with, "products that were aimed at small children and used to suck on or chew on. Although phthalates have been used in plastic for over 30 years, and there are no known cases of phthalates causing health problems, Greenpeace’s press release was strategically timed to coincide with the Christmas toy season, thereby guaranteeing maximum media coverage. As expected, it was immediately picked up by the television networks and, in fact, the ABC show 20/20 did an entire segment on the possible health risks of phthalates. The problem grew worse for Gerber when the media focused specifically on products made for oral use by children. Gerber, the largest producer of nipples, pacifiers, and feeding products in the U. S. , produced some 75 different products containing phthalates and was under considerable pressure to respond publicly to the investigation. Decisions Gerber management had to evaluate all of the current information, weigh the consequences of each action, and proceed on the most prudent course to insure as limited an interruption in business as possible. Gerber knew that a vast body of scientific evidence indicates that phthalates are completely safe. However, once the Greenpeace announcement was publicized, the Consumer Product Safety Commission was spurred to issue a press release expressing new doubts. As the focus gradually fell on items children put in their mouths, and large toy manufacturers like Mattel and Disney began to distance themselves from phthalates, the spotlight of the CPSC fell squarely on Gerber. A month before Christmas, the CPSC informed Gerber they would issue a press release advising parents of the potential dangers of phthalates, and Gerber would be named as one of the companies involved. This is the point at which Gerber implemented a decision tree. Gerber basically faced two choices, neither of which was particularly beneficial.
The firm could be reactive, wait for the announcement, and gauge consumer response before deciding on a course of action, or it could be proactive and aggressively pursue resolution of the problem regardless of the public’s response to the report. The CSPC report suggested the agency would either issue a recall of all products containing phthalates (shown on the decision tree as the unfavorable response), or they would issue a report merely expressing concern in which case the public response would be minimal (shown on the decision tree as favorable). Gerber projected eight possible outcomes on its decision tree. If the firm reacted proactively by discontinuing use of all phthalates, and the CSPC report simply issued a warning, Gerber predicted an 80 percent chance that the public would react favorably to Gerber’s responsiveness causing sales to increase over competitors who reacted more slowly. A potential nationwide revenue increase of $l million was entered into the decision tree. Given a proactive response and a favorable CSPC report, Gerber also recorded a 20 percent chance that sales ould decline by $1 million due to the sensationalistic nature of the press coverage. If the CSPC report is negative and a recall is issued, Gerber predicted 25 percent likelihood that it could preserve current sales through a proactive response. On the other hand, the firm placed a 75 percent probability that a recall would hurt sales by $1. 25 million. Four more alternatives were predicted in the event that Gerber waited for the CSPC report before taking action. With a favorable report and a delayed response, there was thought to be a 25 percent chance that sales would remain flat, along with a 75 percent chance that sales would decline by $2 million. The worst case scenario is if Gerber remains passive and the CSPC report calls for a recall. In that case, Gerber optimistically predicted a 20 percent probability that it could still increase sales by taking advantage of companies who were less prepared for the report and actually gain approximately $. 5 million. However, it was considered an 80 percent probability that significant volume would be lost.
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Boeing Company Analysis
Boeing [pic] Presented by: Urvishkumar Patel Amitkumar Patel Bhavikkumar Patel Manojkumar Patel Vishal Patel Jonathan Mayes MG – 640 Management Policy Dr. Santanu Borah July 27, 2008 TABLE OF CONTENTS INTRODUCTION5 Company Overview5 Boeing Commercial Airplanes5 Boeing Integrated Defense Systems6 Boeing Capital Corporation6 Background7 Sales/Operations9 Constituent Contributions to Corporate Portfolio and Revenue12 Market Share, Revenues, Income, Expenses and Stock Prices over Previous Five Years14 Current Strategies (Corporate, Business, & Functional)15 Core Competencies18 The VRINE Model19 COMPETITION20 Core Competition20 Competitive profiles23 Comparing Core Competencies25 Threats to Boeing’s Competitive Position27 Main Competitors28 Competitive Profile30 FINANCIAL ANALYSIS32 Introduction32 Role of Financial Analysis33 Liquidity/Solvency Ratios34 Profit Ratios35 Leverage Ratios37 Turnover Ratios39 Conclusion41 SWOT ANALYSIS42 Introduction42 Strengths43 Weaknesses45 Conclusion47 Opportunities48 Threats50 Conclusion52 SWOT Matrix53 BUSINESS DEFINITION55 Evolution of Industry Ten Years From Now55 Business Outlook Ten Years From Now56 OBJECTIVES61 ALTERNATIVES62 Measurable Growth62 community Change64 Innovative Business Concept67 RECOMENDATIONS70 Assumptions/Logic Behind Alternatives70 Achieve Objectives70 IMPLEMENTATION72 Setting Unreasonable Expectations72 Elastic Business Definition72 A Cause, Not a Business73 New Voices73 Open Market for Capital and Talent74 Low Risk Experimentation75 Cellular Division75 REFERENCES77 INTRODUCTION Company Overview The Boeing Company is one of the world’s leading aerospace companies and is one of the largest manufacturers of commercial jetliners and military aircraft combined. Boeing also designs and manufactures rotorcraft, electronic and defense systems, missiles, satellites, launch vehicles and advanced information and communication systems.
Boeing operates the Space Shuttle and International Space Station for NASA as well as numerous military and commercial airline support services. The company employs more than 160,000 people across the U. S. and in 70 countries. Boeing has customers in more than 90 countries world-wide and is one of the largest U.
S. exporters in terms of sales.
The company values innovation and is ontinually expanding their product line and services to meet emerging customer needs (About Us). Boeing, who generates $66 billion in revenues from their global aerospace and defense markets, conducts business through three operating segments. Boeing Commercial Aircraft (BCA; 50% of revenues and 49% of operating profits in 2007) and EADS’s 80%-owned Airbus division are the world’s only makers of 130-plus seat passenger jets. Integrated Defense Systems (IDS; 48%, 48%) is the world’s second largest military contractor behind Lockheed Martin Corp.
Boeing Capital Corp. (2%, 3%) primarily finances commercial aircraft for airlines (Business). Boeing Commercial Airplanes Boeing Commercial Airplanes makes planes that seat from 50 to more than 500 passengers. Models include the BBJ (Boeing Business Jet), 717, 737, 747, 767, 777, and upcoming 787 Dream liner. The unit also provides airplane services, including used aircraft sales and leasing, maintenance, modifications, spare parts sales, and flight support services.
Boeing Commercial Airplanes has major facilities in California and Washington (Boeing Commercial). Boeing Integrated Defense Systems Boeing is best known for its commercial planes, but its Integrated Defense Systems (IDS) unit, formed when Boeing combined its Military Aircraft & Missile Systems and Space & Communications units, is well known in the global defense segment. It includes military aircraft (F/A-18E/F Super Hornet, F-15E Eagle, C-17 Globe master, AH-64 Apache, and V-22 Osprey) as well as missiles (Harpoon and SLAM-ER), airborne lasers, and Unmanned Combat Air Vehicles (UCAV). IDS is also NASA’s prime contractor for the International Space Station, supports the Space Shuttle program (a joint venture with Lockheed Martin), and makes information and communications satellite systems.
The United States Department of Defense accounts for nearly 85% of IDS’ sales. Boeing Capital Corporation Boeing Capital provides asset-backed leasing and lending services through two divisions: Aircraft Financial Services offers financing and leasing services for airlines and governmental customers interested in Boeing aircraft; Space & Defense Financial Services offers similar services for Boeing’s Integrated Defense Systems customers. Until 2004 Boeing also provided financial services in non-aerospace areas, but it sold its commercial financing operations to General Electric for about $2 billion. Boeing Capital was founded in 1968 as McDonnell Douglas Finance, and changed its name when Boeing acquired McDonnell Douglas in 1997 (Boeing Capital). Background / Timeline with Facts and Figures Boeing’s origin dates to 1916 when the American timber merchant William E.
Boeing founded Aero Products Company shortly after he and U. S.
Navy officer Conrad Westervelt developed a single-engine, two-seat seaplane, the B&W. Renamed Boeing Airplane Company in 1917, the enterprise built “flying boats” for the Navy during World War I, and in the 1920s and ’30s it successfully sold its trainers, pursuit planes, observation craft, torpedo planes, and patrol bombers to the U. S. military.
In the late 1920s Boeing Airplane expanded into airmail services, and in 1928 William Boeing formed Boeing Airplane & Transport Corporation to encompass both manufacturing and airline operations. The next year the company was renamed United Aircraft and Transport Corporation and acquired several aircraft makers, among them Chance Vought, Avion (which became Northrop Aircraft), Stearman Aircraft, Sikorsky Aviation, engine manufacturer Pratt & Whitney, and aircraft and propeller maker Hamilton Metal plane. In 1931 it combined four smaller airlines under its ownership into United Airlines. In 1934, under new U. S.
antitrust legislation (the Air Mail Act of 1934), aircraft manufacture was required split from air transport, and a newly ncorporated Boeing Airplane Company became one of the three companies to emerge from the dissolution of United Aircraft and Transport. The other two were United Aircraft Corporation (now United Technologies Corporation) and United Airlines (Boeing Company). On a more current note, there are several important dates in Boeing history (Timeline): Sept. 4, 2001 – Boeing opens for business at its new downtown headquarters in Chicago, less than six months after announcing its planned move from Seattle.
Sept. 11, 2001 – Four Boeing-made planes are hijacked by terrorists and crashed in the attacks that kill nearly 3,000 people. Subsequent steep drop in air travel demand sends Boeing’s commercial airline customers into a deep slump. Boeing’s stock loses more than 40 percent of value within two weeks. Dec.
20, 2002 – Boeing announces it is scrapping plans to build the Sonic Cruiser, a plane that would have traveled near the speed of sound, in favor of a more traditional, fuel-efficient jet. July 24, 2003 – Pentagon bans Boeing from bidding on military satellite launching contracts to punish it for stealing trade secrets from rival Lockheed Martin to help win rocket contracts.
Sept. 17, 2003 – Pentagon opens an investigation into allegations that former Air Force official Darleen Druyun improperly gave Boeing information about a competing bid on a widely criticized military contract to acquire 100 air-refueling tankers. Nov. 24, 2003 – Boeing fires Chief Financial Officer Mike Sears and Druyun for unethical conduct, saying Sears negotiated Druyun’s hiring while she was still working for the Pentagon and was in position to influence Boeing contracts.
Dec. 1, 2003 – CEO Phil Condit resigns, hoping “to put the distractions and controversies of the past year behind us. ” Retired Boeing executive Harry Stone cipher succeeds him. Dec. 16, 2003 – Boeing begins taking orders for the 7E7 Dream liner (now the 787), its first all-new airplane since the 777 in 1990.
Jan. 15, 2004 – Airbus SA officially overtakes Boeing as the world’s largest commercial jet maker, announcing it delivered 305 airplanes in 2003 to Boeing’s 281. Oct. , 2004 – Druyun is sentenced to nine months in prison for conspiracy to violate federal conflict-of-interest regulations after admitting she helped Boeing on contracts as a “parting gift” before joining the company.
Feb. 18, 2005 – Sears sentenced to four months in prison for aiding and abetting illegal employment negotiations. March 4, 2005 – Air Force lifts its 20-month ban prohibiting Boeing from bidding on satellite launch contracts. March 7, 2005 – Boeing announces that Stone cipher resigned under pressure the previous day as a result of improper conduct related to an affair with a Boeing female executive. July, 2008 – Boeing unveils 777 Dream liners into the commercial market July, 2008 – U.
S. government officials plan to rebid the Air Force tanker deal.
This gives Boeing another chance to win the $35 billion contract Sales/Operations by Region and Segments The majority of Boeing’s sales and operations result from their U. S. and Asian operations which account for approximately 80 percent of their worldwide sales. Boeing’s core regions and their associated data are illustrated below in Tables 1.
Table 1: 2007 Boeing Sales by Region Region |$ mil |% of total | |US |39,336 |59 | |Asia | | | |China |2,853 |4 | |Other countries |11,104 |17 | |Europe |6,296 |10 | |Middle East |1,891 |3 | |Canada |1,653 |2 | |Oceania |1,057 |2 | |Africa |751 |1 | |Latin America, Caribbean & other regions |1,446 |2 | |Total |66,387 |100 | Source: Hoovers In addition, Boeing’s commercial airplane segment accounts for about half of Boeing’s global operations. The various segments and their associated sales data are shown in Table 2 below. Table 2: 2007 Boeing Sales by Segment |Segment |$ mil |% of total | |Commercial airplanes |33,386 |50 | |Integrated defense systems | | |Precision engagement & mobility systems |13,685 |21 | |Network & space systems |11,696 |18 | |Support systems |6,699 |10 | |Boeing Capital |815 |1 | |Other |280 |- | |Total |66,387 |100 | Source: Hoovers Constituent Contributions to Corporate Portfolio and Revenue Boeing’s generates most of its revenue from their two major segments, Commercial Airplanes and Integrated Defense Systems. Table 2 showed the sales figures for each segment and their associated percentages. Within these sectors, several products contribute to their overall corporate portfolio.
They are broken down into commercial airplanes, military aircraft and missile systems, and space communications. In all, these products generate over $66 billion in revenue for Boeing. Commercial airplanes • 737 Next Generation (short-to-medium-range two-engine jet) • 747 (long-range four-engine jet) • 767 (medium-to-long-range two-engine jet) • 777 (long-range two-engine jet) • 787 (long-range, super-efficient, 200-250 passenger capacity; due in 2008) Military aircraft and missile systems • AH-64D Apache helicopter • AV-8B Harrier II • C-17 Globe master III • C-40 Clipper • CH-47 Chinook • F/A-15 Eagle • F/A-18E/F Super Hornet • Harpoon Missile • T-45 Flight Training System • V-22 Osprey tilt-rotor aircraft • Various classified projects X-45 (Unmanned Combat Air Vehicle — the UCAV is an advanced technology demonstrator) Space and communications • 737 AEW&C (Airborne Early Warning and Control) • Global Positioning System satellites (GPS) • International Space Station (contractor to NASA) • National Missile Defense Lead Systems Integrator (NMDD LSI) • Space Shuttle Commercial Airplanes Boeing’s Commercial Airplanes division accounted for about 50 percent of their total portfolio in 2007 with revenues of about $33 billion. This segment’s revenue stems from commercial aviation orders and is directly affected by worldwide travel demand.
Integrated Defense Boeing’s Integrated Defense Systems accounted for around 49 percent of Boeing portfolio. Within this segment, their Precision and Engagement and Mobility Systems made up 21 percent ($13 billion), Network and Space Systems 18 percent ($11 billion), and Support Systems 10 percent ($7 billion). Boeing Capital Boeing’s Capital Corporation manages a $6. 5 billion portfolio of about 350 airplanes. This segment leases older planes to customers but has seen a decline since many customers are opting for newer fuel efficient planes.
This segment accounts for about 1-2 percent ($815 million) of Boeing’s revenues (Hoovers). Market Share, Revenues, Income, Expenses and Stock Prices over Five Years Boeing competes primarily with Airbus in the Commercial Airplane segment.
The companies share the market almost equally and with fluctuations from year to year. Table 3 shows a summary of their five year financials. Table 3: Boeing Five Year Financial Summary ($ mil. ) |Year |Revenue |Net Income |COGS |Stock Price | |2007 |66,387 |4,074 |53,107 |87.
46 | |2006 |61,530 |2,215 |50,437 |88. 84 | |2005 |54,845 |1,872 |45,849 |70. 24 | |2004 |52,457 |718 |45,025 |51. 7 | |2003 |50,485 |492 |43,862 |42. 14 | Source: Hoovers According to Boeing’s financial numbers, their revenue, net income, and stock prices have increased steadily over the last five years.
In addition, Boeing’s profit margin almost doubled from 2006 to 2007. In 2007 it was 6. 1 percent, up from 3. 6 percent in 2006.
Current Strategies (Corporate, Business, & Functional) The majority of management at Boeing can effectively motivate people and provide guidance and leadership at a high level. Previous top management employees were involved in ethical scandals. New management has made ethics and good business practices a core value of the organization. They communicate the larger company vision and provide a link between the different divisions and programs (Howell). Boeing’s strategy can be divided into corporate, business and functional areas.
Corporate Boeing competes primarily in the commercial airplane market and defense systems market. Through their commercial airplanes segment and their integrated division segment, Boeing conducts a wide variety of business at the commercial and federal level.
Thus, in reality, their corporate strategy is somewhat varied among these segments. Boeing’s official corporate strategy consists of the following elements: • Run healthy core businesses Leverage strengths into new products and services • Open new frontiers Although these are rather generic, Boeing does harness these concepts in order to create a competitive advantage in their markets. They are able to run healthy operations while leveraging strengths by standardizing many of their standardized manufacturing and development processes. In addition, Boeing is successful at opening new frontiers with their “Phantom Works” division.
This segment of Boeing is charged with developing the latest innovations in defense and aircraft technologies (Phantom). Business Boeing has a very distinct business strategy in the commercial airline industry. It focuses on harnessing the latest technological innovations and applying these concepts to the marketplace. This can be seen in the Dream liner 787 development. Boeing is using the latest technologies in engines and fuel efficiency to put the 787 ahead of Airbus.
Airbus relies on the hub and spoke travel method while Boeing is not taking this travel method for granted. They believe travelers will demand more point to point flights over connecting ones (Boeing Versus). These 787 aircraft may launch a departure from the traditional hub-and-spoke airline flights system to a more direct point-to-point system. Therefore, they may add considerable value as the market continues to change in Boeing’s favor.
Functional The Boeing Company has many generic administrative systems that assist the organization in accomplishing economies of scale thus reducing administrative costs and confusion. The organizational structure of The Boeing Company is a matrix with divisional characteristics as determined by the geographical sites. The functions and programs represent the matrix architecture and the different sites provide the divisional aspect. Boeing uses nine common business functions in order to operate their two major business segments, Commercial Airplanes and Integrated Defense. These functions are (About Us): • Business Development and Strategy • Communications Engineering, Operations and Technology • Finance/Shared Services Group/Boeing Capital Corp.
• Human Resources/Administration • International • Law • Office of Internal Governance • Public Policy Core Competencies As a predominantly engineering workforce, the ability to recognize problems quickly and to come up with creative solutions is a core competency of the organization. Boeing is able to add considerable value with their human resources and their standardization processes among their large organizational structure.
This standardization process allows them to share knowledge among different units. Boeing identifies three main core competencies in their strategy: ) Detailed customer knowledge and focus 2) Large scale systems integration 3) Lean Enterprise Boeing’s lean enterprise practices and systems integration efforts allows for process standardization from division to division. This is a major advantage for Boeing over many of its competitors. VRINE Model Evaluation The VRINE model determines whether or not a resource or capability can help a firm compete and achieve superior performance.
The resource or capability must exhibit five basic characteristics 1) value, 2) rarity, 3) inimitability, 4) nonsubstitutability, and 5) exploitability. Boeing’s latest development, the 787 Dream liners is becoming a valuable resource for the company. It was built to meet the market demand for larger and more fuel efficient jets. Boeing has almost 900 orders valued at $144 billion dollars. The 787 uses 20 percent less fuel per passenger, a tremendous innovation that will hedge against rising fuel prices and create more demand from frugal airline companies (Best).
The 787 competes directly with Airbus’s A380, a larger and less efficient plane. Boeing and Airbus operate in a duopoly in the industry and have committed large resources to their substantially different programs. Boeing’s innovative 787 design is valuable, rare, inimitable, and nonsubstitutable at the moment. It time Boeing will be able to exploit this design over Airbus in the large commercial jet market.
Currently, Boeing is getting more and more 787 orders as consumers are seeing the added value and fuel efficiency of their design. This resource is allowing Boeing to compete and outperform Airbus. COMPETITION: Core competition A Core Competency is a particular skill or technologies that create sole customer value. According to strategic management literature, core competency should provide significant and appreciable value to customers relative to competitor offerings and be difficult for competitors to imitate or procure in the market, thereby creating competitive barriers to entry. Boeing has been identified for its diversified culture of business; so that Boeing is incomparable due its multiple core competence.
However, we would like to focus on select few competencies that have a possible to gain uniqueness in short future based on our own study of this business establishment. Boeing classifies three main core competencies such as detailed customer knowledge and focus, large-scale systems integration, and lean enterprise.
Detailed customer knowledge and focus Boeing seeks to understand, anticipate and be responsive to our customers’ needs. Phil Condit, company’s Chairman and CEO, introduced a concept of “Market shaping”. According to Condit, Market shaping gives knowledge where your customer is going; employing Boeing creativity, resources and technological expertise to cooperatively help them there; and having the right products and services waiting when they get there Large-scale systems integration Boeing continuously develops, advance, and protect the technical excellence that allows us to integrate effectively the systems we design and produce. This core competency can also be known as Boeing’s R&D core competency.
Lean enterprise Boeing entire enterprise will be a lean operation, characterized by the efficient use of assets, high inventory turns, excellent supplier management, short cycle times, high quality and low transaction costs. The strengths of Boeing are its: • Boeing’s strength constantly depends on the diversity of its people, products and opportunities. The people working at Boeing do not work on leading-edge technology but use help make tomorrow better. • Boeing’s product line and services are well maintained to develop and to meet talented customer needs. At Boeing their strengths and processes are reexamine to build a company as strong and vital as its tradition.
• Boeing success depends on the Satisfaction of customers. By accepting what customers need and providing service perfectly then Boeing accomplishes total customer satisfaction. • Boeing will take directly to our commitment by working the maximum ethical standards and by worshiping our commitments. • Boeing tries hard to improve quality by finest way they can work to rank among the world’s premier industrial firms in customer, employee and community satisfaction • Boeing will offer a safe workplace and protect the environment and also promotes the health and safety of its people and their families.
Our future success is based on a three-pronged strategy: • Run healthy core businesses • Leverage our strengths into new products and services • Open new frontiers (www. graduatingengineer. com) • Boeing’s elements at the maximum level are Diversity and inclusion. For the developing superior aerospace product and service for our different customers in the world is essential in having diverse employees, business partners and community relationships. • Boeing knows that diversity gives them a competitive advantage.
• Boeing’s commitment to diversity means providing a work environment for all employees, respectful and attracting, with opportunities for personal and professional development. This in turn increases productivity, quality, creativity and innovation.
• Boeing knows that diversity gives them a competitive advantage. Boeing is a company with nearly 200,000 people, operations in 26 states, and customers in more than 145 countries. Still, they must do more than assume that diversity will simply come to them because of their size and global reach. • Diversity is about each employee.
The point is not that there are differences. The point is whether they can learn from those differences • Boeing has a strict diversity strategy, mission and goals, which leads a variety of internal programs and events. Boeing quality reaches new pinnacles every day motorized by Boeing people. In Boeing’s view, the true test of diversity within an organization or across a whole society is whether people build upon their differences or whether they are divided by them (“Culture”, Boeing). Competitive profiles In Boeing Commercial Airplane sector, the direct competitor is Airbus and in the integrated defense systems sector the main competitors are Lockheed Martin and Northrop Grumman.
The table provides competitive profiles of Boeing and Airbus in the large commercial airplane industry for year 2007. | |Boeing |Airbus | |Revenues ($ mil. ) |$66,387. 0 |$34,301.
8 | |Net Income ($ mil. ) |$4,074. 0 |$3107. | |Net Profit Margin |6. 1% |5.
7% | |Market Capital |$46,486. 1 |$37,281.
6 | |Number of employees |159,300 |147,450 | |Operating Income |$5,937. 0 |$4,842. 0 | |Revenue Growth |6. 9% |6.
5% | Table: Commercial Airplane Competitive Profile Comparisons Boeing focused on being No. 1 by giving their best efforts helping to secure its future and by looking for innovation across the board: ? Engineers are showing the enterprising spirit that initially made Boeing and its predecessor companies great. ? Factory people are pioneering Lean initiatives that are spreading into the office environment. ? Sales, marketing and business development people are helping understand what products and services that customers need now and what solutions they will need in the future. ? Functional and support organizations are working on providing common systems that will make Boeing more efficient and better able to compete in tough, ever-changing markets.
? Boeing has put in place clear and challenging new targets for revenue growth, earnings, asset performance and cash creation in 2005 and 2006 and is working to achieve them. Airbus Airbus is the main competitor in airplane sector, having nearly the same competencies and core objective to make Airbus more efficient and competitive, so as to produce the most advanced and profitable products, and to serve its customers better in the future. Airbus have force it to the front position of the industry through its customer focus, commercial know-how, technological leadership and manufacturing efficiency have force it to the forefront of the industry as it is the leading aircraft manufacturer. With a turnover of around 22= billion Euros in 2005, Airbus today consistently captures about half of all commercial airliner orders.
By affecting its expertise to the military market, Airbus expands its scope and the product range. (About us. “Airbus. com”) For applying power 8 Airbus has the full support of all EADS core shareholders. The EADS and Airbus management has evaluated the programs and predicts measures which will distribute on its economic promises.
According to CEOs of EADS Tom Enders and Louis Gallois of Airbus, the core objective of the programs is to make Airbus more efficient and competitive, so as to produce the most advanced and profitable products, and to serve its customers better in the future. Power 8 modules are: • Develop Faster states reduction of cycle time of new aircraft development from 7.
5 to 6 years Lean Manufacturing (further integration of manufacturing and associated engineering, • increase productivity by 16 percent until 2010), • Smart Buying (reduction of the Airbus supply cost base; • building of a network of strong risk-sharing partners, • streamlining the logistics organization), • Maximize Cash (reduction of financial working capital) and • Customer First (serving customers even better, higher levels of services, more reliability and further improved quality) Comparing core competence In the overall view of air transportation industry the competition between Boeing and Airbus is regarding on the decisions of present and future directions of their companies gives close into direction of industry. In their vision of the future of air transportation Boeing and Airbus have recently take apart by their newest models in production, the A380 and the 7E7 respectively. Due to the production of their new planes the view differs: The goal of Boeing’s smaller 7E7 focuses on airplanes flying nonstop between smaller terminals. In compare, the goal of Airbus’ A380 jumbo jet focuses on planes flying from local terminal to international terminal.
It is predicted by a by Drs. Irwin and Pavcnik an economic analysis of the Airbus and Boeing competition that the A380 will further reduce the market share of Boeing’s 747 by 14. 8% (Irwin & Pavcnik, 223). This analysis shows that Boeing’s will maintain to decline while Airbus’ current market share will maintain to control for the next decade. There is an increase in air traffic of 5 percent every year and the analysts estimate that there will be a purchase of 40,000 planes over the next two decades.
Airbus currently has orders for 156 A380s. The A380 has encouraged a number of operations for the larger planes like constructing double-decker passenger ramps and strengthening bridges and roads. Airbus estimates that more than 60 airports will be handling A380 flights by 2010. There is a interruption in corporation as the division created by Airbus and Boeing, their competition may be differentiate as that between the unknown European Union and the United States and also their policies on the future air transportation.
Thus, it will provide approaches into the globalization forces determining air transportation and its future due to the comparison of Airbus and Boeing, competition factors, and also plans for the future. In 2001 Airbus addition as single company, has quickly moved from the market beginner to the market leader in air transportation. Airbus has mountaineering between the periods of 1988 to 1996 by 16% to 37% of the market respectively. (Dempsey & Gesell, 85). However, Airbus has delivered 305 jets in 2003 soared to more 50% of the market in 2004, and its target was to transport 310 jets in 2004 and 400 jets in 2005 (Reuters, 9/8/2004).
There is no revelation that Airbus has had speedy growth though the economic recession of the late 1990’s and early 2000s. Innovative designs and broad based customers focus gives advantage to Airbus.
After a sequence of purchases and merger, Boeing has known as a world leader of aircraft production with such companies as Rockwell International (merger, 12/1996) McDonald Douglas (merger, 8/1/97), Hughes Electronics (purchase, 1/2000), Jeppesen Sanderson (purchase, 9/2000), and Hawker de Havilland (purchase, 10/2000). Boeing connect in a many of business sectors such as air traffic management, commercial airplanes, broadband services to airlines, integrated defense systems, and research and development. In turn, Boeing estimates more orders for Boeing 787 because it uses 20% less fuel than other similar planes operating today. Still in current situation, Boeing’s production facilities are largely booked for the next few years, and the 787 is sold out through 2011 thus limiting Boeing’s ability to accept new orders.
However, in the future competition between Airbus and Boeing plays a vital role. Because Boeing versus Airbus is one of the most difficult which strongly observe marketing battles elsewhere? It’s also one of the most captivating. But one will increase difficulty in management through the networks of national and international policy formation, supplier-airline worker-corporation tensions, passenger demands, technological innovations, market uncertainty, and ever-increasing economies of scale. Due the current oligopoly the market has become overly complex; but if any of these companies develop to take over aircraft production then surely suffers. At the present Airbus is better over Boeing, but if Boeing accomplishes in winning this battle it will amount to one of the great change or the problem of business fortunes.
It will moreover provide as evidence of the knowledge of understanding the marketplace well sufficient to direct. According to Marc E. Babej and Tim Pollak, to date, Airbus carriers 159 order of A380s, and roughly twice of Boeing 787s. (elsmar.
com/Forums/showthread. php? t=16728 – 84k) Threats to Boeing’s Competitive Position In the 1970s, world airplane markets began to transfer from the U. S. to other countries. The main hindrance to the Europeans union was Boeing’s idea of how the work was to be common.
In spending amount on R&D there is a vast difference between Boeing and Airbus. Airbus is leading with regard to R&D spending and capital investment.
For example in 2003, Boeing has spent only 3. % of its total revenues towards R&D where as Airbus allocated 9. 5 % of its total revenue. In the same year Boeing spent 0.
97 % of its total revenue towards capital investment where as Airbus allocated 9. 1%. This makes Boeing difficult to ‘catch-up’ by the time the A380 of Airbus, 787 of Boeing unfold. More over The British government announced it would finance research into new computer-modeling techniques at several British universities. This could help Airbus speed up product development by as much as 90%.
This strategy of Airbus spending more on R&D in innovating new technology is a direct threat to the Boeing’s competitive position. Boeing’s Vulnerability Boeing is not on time for the implementation technological innovations that its rival Airbus is accepting as getting family approval for different planes, accordingly without any certification it also permit pilots to move from one model of plane. • It s also true that Airbus gets the aid of finances and leasing operation to maintain it’s sales in which Boeing is back. • Boeing should not expect that It is not that in the future the EADS will reduce its financial assistance to Airbus Boeing should not expect that and compete without any protection in the world market.
So that Boeing should search association or agreement for its financial assistance and break its rival. • According to the U. S. Federal Aviation Administration, there is a susceptibility of Boeing’s new 787 Dream liner which has serious security weakness in its onboard computer networks that could a allow passengers to access the plane’s control systems. Main Competitors Lockheed Martin is the world’s number 1 defense contractor which leads Boeing and Northrop Grumman and also the company transport it’s product in times of crisis.
Lockheed Martin plays an important role in serving to strengthen the quality of life in our nation. In the world, Lockheed Martin utilizes the most modern in engineering technology.
Lockheed Martin Corporation, expands manufactures, integrates, controls, and sustains technology systems, products and varieties of management such as engineering, technical, scientific, logistic, and information services and also expanded in the United States and globally. Lockheed Martin Corporation also uses the most new features production technologies such as laser ultrasonic inspection and laser direct manufacturing. Lockheed Martin have capable professionals and experts in their fields, so that they can contribute good to their customers and their employees also offers myriad volunteer hours to advance a wide variety of causes. At Lockheed Martin, the diversity and inclusive is not just a short-term trend.
It is a business imperative. They are committed in generating an environment that welcomes, respects, creating one company, one team and leverages our individual differences as a competitive strength. Diversity is clear of legal requirements like Affirmative Action and Equal Employment Opportunity. Lockheed Martin is committed to cultural and nationally equality and also identifies the qualities to make people unique which include their beliefs, job experiences, cultural backgrounds and intellectual perspectives (“ABOUT US, At A Glance”, Lockheed Martin). Northrop Grumman Corporation is a global defense and Technology Company which is the company is the fourth largest defense contractor in the world.
Northrop Grumman Corporation’s120, 000 employees provides innovative systems, products, and solutions in information and services, electronics, aerospace and shipbuilding to government and commercial customers worldwide. Northrop Grumman has several business sectors such as Electronic Systems, Information Technology, Integrated Systems, Mission Systems, Newport News, Ship Systems, Space Technology, Northrop Grumman Corporate together comprise Northrop Grumman (“Northrop Grumman”, about us). Northrop Grumman vision is the trusted provider of systems and technologies that ensure the security and freedom of our nation. Northrop Grumman is technology leader and also to classifies the future of defense from undersea to outer space, and in cyberspace and develops the next generation flying tanker transport, space radar, long-range strike aircraft bomber and the next generation aircraft carrier, destroyer and cruiser.
Northrop Grumman has four business areas like Information and service, Electronics, Shipping and Aerospace. And also helps to define globally health-information network architecture and other highly developed information systems. (Northrop Grumman. com) Competitive Profile Supplier diversity is a fundamental business strategy at Boeing. Diversity brings strength, innovation and flexibility to the supply base.
Beating the skills and technologies available within the community of small and diverse businesses is an important to sustaining position as the leading aerospace company in the world (“Supplier Diversity”, Boeing). The competitor’s of Boeing openly Integrated Defense sector are Lockheed Martin and Northrop Grumman.
The following table shows the competitive profile of Boeing, Lockheed Martin, and Northrop Grumman for the year 2007. | |Boeing |Lockheed Martin |Northrop Grumman | |Revenues ($ mil. ) |$66,387. |$41,862.
0 |$32,018. 0 | |Net Income ($ mil. ) |$4,074. 0 |$3,033. 0 |$1,790.
0 | |Net Profit Margin |6. 1% |7. 2% |5. 6% | |Market Capital |$46,486.
1 |$40,610. 4 |$23,276. 3 | |Number of employees |159,300 |140,000 |122,600 | |Operating Income |$5,937. 0 |$4,324. 0 |3,006.
0 | |Revenue Growth |6. % |7.
3% |6. 9% | Table: Competitive Profile Comparison FINANCIAL ANALYSIS Introduction Financial statement analysis involves comparing a firm’s performance with the performance of other firms in the same industry and evaluating trends in the firm’s financial position over time. Financial analysis aids in understanding why a company is performing as it is and in forecasting where the company is headed. Financial analysis is used by managers to improve performance and by lenders to assess the likelihood of loan collection and also by investors to forecast earnings, dividends, and stock prices (Brigham, p.
71). Financial statement analysis uses ratios computed from absolute financial measures divided by common denominators. Absolute measures from financial statements include net income, gross margin, and other specific measures. These absolute measures are useful for assessing the growth of one firm over time, but not for comparing firms of different sizes or in different industries (Brigham, p. 73).
Ratios standardize these absolute measures and make comparison possible. Some common ratio measures are return on sales, return on assets, and return on equity. Financial performance measures are probably the most common measures taken. However, performance is a multidimensional concept.
Measures other than financial ratios are used to assess performance and the health of the business. For example, stock market performance measures are another important performance measurement. Stock market measures include one- and five-year market returns, earnings per share, and price earnings ratio. Market share, industry-specific measures, cycle time, and time-to-market are also measures of performance (Harvey B. Lermack, Steps to a Basic Company Financial Analysis).
Users of financial statement analysis must be aware of extraordinary items and accounting adjustments that can affect the numbers on the financial statements. It is wise to “look beyond the numbers” when using financial data to assess competitive advantage.
Users must read the “Notes to Accompany the Financial Statements” and consult a wide variety of resources to assess a firm’s financial position and health (Duhaime, p 57). Financial statement analysis has both strengths and limitations. One advantage of financial analysis is the availability of data. Financial data for publicly held companies is widely available and easily accessible.
A second advantage of financial analysis is the use of ratios that makes comparison among companies easy. Limitations of financial analysis include the following: the ratios must be compared with another company, the industry, or that company’s past performance to have any meaning; and financial data reflects activity from the past (Brigham, p 73). This financial analysis is a comparison among competitors in the large commercial aircraft industry. Boeing will be compared with a key competitor, EADS (Airbus’s parent company). The ratios used for this comparative analysis were retrieved from the different website.
Any statements regarding a company’s financial position or health are drawn from personal interpretation and are not representative of any formal, professional opinions or statements. Role of Financial Analysis Financial data represent the concrete results of a company’s strategy and structure. Although analyzing financial statements can be quite complex, a general idea of a company’s financial position can be determined through the use of ratio analysis. Financial performance ratios can be calculated from the balance sheet and income statement (Hill, C8).
These ratios can be classified into four major subgroups: liquidity/solvency ratios, profitability ratios, leverage ratios, and turnover ratios. The purpose of the following financial analysis is to measure The Boeing Company and their financial performance in 2007. A key competitor, EADS (Airbus’s parent company), will also be shown in the analysis. To fully understand Boeing financial situation, Boeing will be compared to EADS and the industry as a whole. Liquidity/Solvency Ratios A liquid asset is an asset that trades in an active market, which means it can be quickly converted to cash at the going market price.
A firm’s liquidity position deals with whether the firm can pay off its debts as they come due over the next year or so. A company’s liquidity or solvency is a measure of its ability to meet short-term obligations.
An asset is deemed liquid if it can be readily converted into cash. Liquid assets are the current assets such as cash, marketable securities, accounts receivable, and so on. Several liquidity ratios are commonly used to assess these abilities (Hill, C9). |Ratio |Boeing |EADS |Industry | |Quick Ratio |.
55 |. 57 |. 1 | |Current Ratio |. 86 |1. 13 |1.
29 | Source: Reuters [pic] According to the general rule of having a quick ratio of 1. 0 to be healthy, Boeing, whose ratio is . 55, is not capable of satisfying current liabilities without depending on sales from inventory. EADS has a higher quick ratio and higher current ratio.
This indicates that EADS may be in a better position to pay off short-term obligations. Quick ratios below 1 indicate that the company may be more susceptible to bankruptcy due to failures with short term commitments. However, the industry average falls well below the 1 mark, showing that this low quick ratio is common in the industry. Profit Ratios Profit ratios measure the efficiency with which the company uses its resources. The more efficient the company, the greater is its profitability.
It is useful to compare a company’s profitability against that of its major competitors in its industry to determine whether the company is operating more or less efficiently that its rivals. In addition, the change in a company’s profit ratios over time tells whether its performance is improving or declining (Hill, C8).
A number of different profit ratios can be used, and each of them measures a different aspect of a company’s performance. Ratio |Boeing |EADS |Industry | |Profit Margin |6. 55 |-1. 12 |2.
99 | |Return on Assets |7. 85 |-. 59 |3. 20 | |Return on Equity |59. 84 |-3.
42 |13. 58 | |Return on Capital |17. 3 |-1. 1 |13.
7 | |Price/Sales Ratio |. 72 |. 4 |. 88 | |Price/Cash Flow Ratio |8. 2 |7.
40 |9. 2 | Source: Reuters [pic] Return on assets and return on equity are two of the most commonly used profitability ratios.
Return on assets (ROA) is the ratio of net income to total assets. It is calculated by dividing net income available to common stockholders by total assets. The higher the number the better the profitability is. As long as a company’s ROA exceeds its interest rate on borrowing, the company is said to have positive financial leverage (Brigham, pp.
78). Looking at the data above, Boeing is far more profitable than EADS and they are more profitable than the average competitor in the industry. Boeing’s higher return on equity shows that they are creating a superior value to investors in contrast to EADS and the industry average. Leverage Ratios A company is said to be highly leveraged if it uses more debt than equity, including stock and retained earnings. The balance between debt and equity is called the capital structure.
The optimal capital structure is determined by the individual company. Debt has a lower cost because creditors take less risk; they know they will get their interest and principal. However, debt can be risky to the firm because if enough profit is not made to cover the interest and principal payments, bankruptcy can result (Hill, C10). |Ratio |Boeing |EADS |Industry | |Debt to Equity |90.
78 |36. 78 |105. 65 | |Leverage Ratio |6. 7 |5. 8 |4.
8 | |Interest Coverage |705. 3 |N/A |465.
| |Book Value/Share |12. 02 |25. 57 |18. 01 | Source: Reuters [pic] Boeing’s debt-to-equity ratio is much higher than EADS but lower than the industry average.
This may be the most widely used measure of a company’s leverage. This indicates that Boeing has a higher debt within its capital structure. They have been more aggressive in financing its growth with debt. This can lead to volatile earnings as a result of the additional interest expense of debt, but may also lead to increased growth if the benefits of the debt financing outweigh the interest expense. However, after analyzing Boeings interest coverage ratio, it is evident they generate sufficient revenues to satisfy interest expense.
Turnover Ratios Turnover ratios indicate how effectively a company is managing its production. This includes the management of receivables, inventory, and assets. The word velocity describes the idea of speed, turnover, or movement. Think of raw materials moving through a factory and becoming finished products, and think of those finished products moving off the shelf to the customer.
That’s velocity. The faster the better products move through a business to the customer. The faster the velocity, the higher the return of turnover is. In fact, return on assets is nothing more than profit margin multiplied by asset velocity (quintsblog. wordpress.
com). |Ratio |Boeing |EADS |Industry | |Receivable Turnover |11.
87 |8. 24 |5. 59 | |Inventory Turnover |5. 79 |1.
94 |2. 93 | |Asset Turnover |1. 20 |. 53 |. 45 | Source: Reuters [pic] Boeing’s receivable, inventory, and asset turnover numbers are superior to EADS and the industry average.
They are more effective at moving their products than their competitors. This generally implies higher sales figures. Overall, by analyzing this turnover data, Boeing is very successful in their production and sales processes. Conclusion This analysis has been a general overview of ratios used to evaluate a company’s (Boeing) performance and compare that company’s performance with its competitors and the industry as a whole.
Liquidity, asset management, debt management, profitability, and market value ratios were evaluated. Also, historical revenue data was reviewed and revenue per employee was evaluated. The following conclusions are drawn based on the comparison of different financial ratios and evaluation of the data discussed: ? Boeing ranked number one in civil aerospace categories ? Boeing’s strengths are quick inventory, strong return on equity, and efficient use of employees ? Boeing increased its sales during past ten years. ? Boeing’s net profit margin declined in past seven years. ? Boeing is gaining as a competitor in this industry relative its competitors.
IV. SWOT ANALYSIS Introduction The Boeing is one of the world’s major aerospace manufacturing firms.
Boeing is one of the prime contractors for the US Department of Defense (DOD) and NASA and also supplies the commercial jet for private companies. It is one of the largest exporters in the US, serving customers in all over the world. Leveraging its strong market position, Boeing has established its brand image, which gives it a competitive advantage over regional players such as Bombardier and other companies like EADS (Airbus’s parent company). However intensifying competition in all its major segments could reduce the market share of the company (www.
datamonitor. com). SWOT is a tool that identifies the strengths, weaknesses, opportunities and threats of an organization. Particularly, SWOT is an essential, basic model that assesses what an organization can and cannot do as well as its potential opportunities and threats. The method of SWOT analysis is to take the information from an environmental analysis and separate it into internal (strengths and weaknesses) and external issues (opportunities and threats).
Once this is completed, SWOT analysis determines what may assist the firm in accomplishing its objectives, and what obstacles must be overcome or minimized to achieve desired results (Investopedia. com). In this case, the SWOT is (wikipedia. com): ? Strengths: attributes of the organization those are helpful to achieving the objective.
? Weaknesses: attributes of the organization those are harmful to achieving the objective. ? Opportunities: external conditions helpful to achieving the objective. Threats: external conditions harmful to achieving the objective. Strengths Leadership Position In aerospace world, Boeing is one of the world’s leading aerospace companies, being the largest manufacturer and supplier of satellites and military aircraft in the world. The company is also a global market leader in human space flight, missile defense, and launch services.
In terms of sales, Boeing is one of the largest US exporters, with revenues and the export. The solid reputation and brand recognition worldwide are great sources of competitive advantage.
Boeing enjoys all the benefits of being a large global company such as cost benefits arising through economies of scale. Leveraging its strong market position, Boeing has established its brand image, which gives it a competitive advantage over regional players such as Bombardier and Airbus. (www. datamonitor.
com). Steady Defense Business Boeing’s defense business has been increasing continuously in the recent years. Revenues from the company’s integrated defense systems segment grew from 2003 to 2008, representing a CAGR of 6%. The defense business accounts for over 55% of the revenues and strong performance of this division would guard it against any downturn in the commercial aircraft industry (www. datamonitor.
com). Strong Growth from Developing Geographic Markets Boeing has registered a strong growth in the developing markets of China, Oceania and Africa. Recently, Boeing lands $10 Billion in emerging market deal with China which is increasing revenues from these markets regions represent the company’s growing market share. Further these regions represent some of the fast growing economies of the world and the company’s growing market share in these regions would boost the revenues in the future (www.
datamonitor. com). Strong Global Network The company has strong international operations with customers in around 145 countries, employees in more than 60 countries and operations in 26 states. Worldwide, Boeing and its subsidiaries employ close to 188,000 people with major operations in Washington State; Southern California; Wichita, Kansas; and St. Louis, Missouri.
Boeing enjoys the ownership of a brand with good and far reaching awareness on a global scale. Boeing enjoys many strong alliances with many other globally powerful companies.
In defense projects Boeing works closely with Northrop Grumman in programs such as the joint common missile program. Boeing is also a partner with Lockheed Martin in the United Space alliance. Boeing also works with many other organizations such as NASA in close relationships, which strengthen the company’s position in other markets (www. 123helpme.
com). Broad Product Line That Covers Most Major Market Niches / R&D Development Boeing Company produced a wide range of product. Company main product is commercial product such as aircraft; Boeing has 717, 737, 747, 757, 767, and 777 families of jetliners and the Boeing Business Jet. Boeing is planning to release a new version of aircraft, 787, which is called the Dream liner. This new revolutionary product, takes Boeing into the new millennium by giving airlines and passengers a better, safer, and more comfortable aircraft with less time in the air.
The company has more than 14,000 commercial jetliners in service worldwide, which is roughly 75% of the world fleet. Its product line is continuing to expand, creating new versions of its family of commercial airplanes. Because of all these revolutionary technology development helps Boeing to stay a leader in the industry. Weaknesses Losing Market Share to EADS (Airbus’s parent company) Boeing has been losing its market share to its rival EADS in the commercial jetliners market.
From the year 2003, EADS has been always selling more jetliners than Boeing in terms of new aircraft orders. As a result, Boeing has lost its leadership position in commercial aviation. Declining market share in the commercial aviation market could affect Boeing’s revenues growth and profit margins (www. datamonitor. com).
A Hierarchical, Ridged, and Semi Autocratic Management Style The bureaucracy and hierarchical, semi-autocratic management style in which the employers makes decisions on their own with little or no input from employees. This does not fit in the modern management and for this reason; Boeing has several problems in management when it practices racial discrimination, tussle with its union workers, and then lets its executives flee the scene to avoid accountability (www.
123helpme. com). Declining Revenues from the Key Geographic Segments Boeing’s revenues from the key geographic markets have declined in the fiscal 2005. Revenues from Asia, other than China, and Europe segments declined by 8.
5% and 19. 6%, respectively, in the fiscal 2005 over 2004. These two markets together represent more than 17% of the company’s revenues. Declining top lines in these markets indicates that the company has been losing ground to its competitors (www. atamonitor.
com). Labor Problems Boeing lacks effective vertical and horizontal communications within the company and has a great deal of unnecessary information. As a result, employees feel divided from management. As a result, production problems delayed delivery, Boeing was forced to increase its work force, working in three shifts, to complete the planes.
Because of inexperienced work force created additional problems and the cost per plane is increased significantly. Moreover, the inexperienced workforce found the aircraft design too complex to implement. The problems affected other Boeing airplanes and complaints from customers began to increase. The Federal Aviation Administration (FAA) ordered special inspections of all Boeing jetliners produced since 1980 to look for defects that might affect safety. The strains of the forced overtime contributed to a 48-day strike in the fall of 1989 that hurt Boeing financially (www.
123helpme. com).
Dependence on US Government and WTO-Incompatible Subsidies Recently, Boeing mainly gains the benefit from the US, which is 65% of the company’s total annual sales. Moreover, Boeing is being criticized by EADS for the subsidy contracts as well as foreign and domestic support all amount to aid for Boeing’s 7E7 model that is double what was available for the new Airbus A380. Whilst this fact is on one hand a great strength of the company with many opportunities it could also be construed as a weakness (www. 123helpme.
com). Conclusion Boeing should supplement its strengths in the commercial aircraft sector and in the space and defense sectors by developing new technologies. Boeing’s unique technical knowledge and continual learning in these two sectors will complement each other and thereby providing ample opportunities to create sustainable competitive advantages. Boeing should exploit its vast network in the commercial aircraft side to find optimal partners and alliances in order to outsource more responsibilities in the areas of design and manufacturing to gain further comparable cost advantages. At home, Boeing should supplement its technical knowledge on composites and other materials for further reductions in aircraft weight.
In areas that Boeing is weak, Boeing should seek out alliances that leverage its capabilities. In aircraft engine development, an area of current intense focus, Boeing should partner in the development of new technologies that allows the use of alternative fuels such as ethanol. Boeing is in a unique position on the space and defense side to exploit emerging markets in commercial space applications. For example, several private firms are currently developing prototype inflatable space “hotels” which can be used for a wide variety of applications.
Everything from tourism to Scientific Research could be a reality within the next decade. Boeing cannot go at it alone, however. As the commercial industrialization of space becomes a reality, Boeing must seek out complementary alliances in order to reduce risk and gain complementary resources and capabilities for the development of technologies that will be needed in the near future. Opportunities New Aircraft to Gain Market Share With the very impressive show of Airbus A380 recently, Boeing also plans to release its powerful weapon in the competition with Airbus. The new version Boeing 787, which has the most advanced technologies and advantages of the previous models is hoped to be considered as a big hit to the airline industries.
At the moment, Boeing has received a large number of orders (booked through 2013) for Boeing 787- Dream liner which indicates that Boeing still insists on its successful business strategy to build longer-range, more capable, smaller aircraft that could go point-to-point and, therefore, serve city pairs directly rather than having to hook them up through a hub. The new 787 is the proof that Boeing does not lag behind the competition in this competitive era.
Expanding Commercial Jetliner Market The commercial jetliner market is not overwhelmingly expected to grow to $2. 1 trillion by 2024. By that year the global commercial airplane fleet is expected to double, in comparision to the existing fleet size. It is projected that the passenger traffic would further grow at 4.
% annually till 2024, requiring approximately 25,700 new commercial airplanes to meet the increasing traffic. As single-aisle aircrafts offer more frequencies and increased non-stop trips in domestic service and short-haul international flights, the demand for single-aisle is expected to be more than the larger aircrafts. Out of the total demand for new airplanes, more than 50% would be for the single-aisle aircrafts. Boeing has a strong hold in the single-aisle airplanes segment and is well placed to gain a major share in the growing commercial airplanes market. (www.
datamonitor. com). Increase Demand for Point-To-Point Routes This is pertained to the booming market of low-cost airline. In order to reduce the costs substantially, all the low-cost airline companies use a point-to-point route which is suitable with the strategy of Boeing as mentioned in the previous parts.
Airbus A380 is still not sure about its future because most of the big airline companies at the moment are not gaining profit (www. 123helpme. com). Increasing Demand for Business Jets The business jet market is growing well as an increasing number of weal
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The Grading System is Bad
AL2 Students who get A’s, couldn’t apply the knowledge and yet, 'on paper' still look more educated than the student who earned failing grades and even if the student could apply the knowledge. Generally speaking, grades do not accurately indicate how much a student has learned in a class. Assessments too should be based on real world application of the knowledge and skills, rather than how well students can memorize information and answer questions on a test. Ways to demonstrate knowledge gained is by grades. On paper this seems to be an awesome idea to be able to put an exact symbol to demonstrate a student's development. But does the grading system help our students? No, as there are several reasons why the grading system should be eliminated. The grading system does very little now, but creates competition, stress, and loss of innocence. This is because when students are graded, students tend to compare among their friends. Weak students get depressed when being reprimanded by their teachers. On the other hand, stronger students are at constant pressure to strive even harder although they are no longer capable, just to impress those around them. Students are also a victim by parents whom often forget that all children have the different capabilities, they push their children off the limits thus causes children to be stressed out just to meet their parent’s requirements.
When students are stress, their self esteem is low. When this happens, it does NOT encourage the student to work hard but causes them to give up instead! Think twice, should the education authorities really enforce competition among children? In addition, the grading system does not encourage students to study for the pursuit of knowledge. By nature, most of us are curious and inquisitive. In school, we are educated out of that curiosity because the grading system focuses off the educational process, and only on the final grading result. With the emphasis purely on grades, students are encouraged to learn just for the sake of grades, are naturally less enthusiastic about the subject, and as a result are less interested in learning for the pursuit of knowledge. What is the aim of schooling if the emphasis is no longer on knowledge? Yes, all of us agree that the grading system encourages competition among students to compete with each other to strive as the “Top Student”. Hence, students are more motivated to study and strive for success. But without the grading system, a more relaxed environment would be created. Some students may lose motivation, but others might gain motivation. If rewards are implemented instead of symbols, students may find school easier and more enjoyable. Students who are more comfortable with their lives, learn more easily. By, eliminating a large source of stress such as competition, it will NOT only improve children's education, BUT their lives. As a conclusion, if students are assessed on their proficiency or mastery of a subject, it is fairer. Like any tool, the grading system has its flaws and can be manipulated by the invigilators. These days, most companies don’t even care about grades as they are only interested in capabilities. Grades are overrated. Last but not least, if the emphasis was put on the aspect of trying our best, to learn our best, and be excited about learning, then education would improve.
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Strategy Project: McDonald’s and Beef
The Category Strategy Project McDonalds and Beef Introduction Commodities are necessities for the success of numerous businesses throughout the world. Preparation and research concerning a commodity must be completed in order for a company to source that commodity successfully. The purpose of this study is to provide purchasing management and top management with specific information that can be used to construct an advantageous procurement strategy. If a company does not have reliable useful about a commodity, that commodity’s market, and that commodity’s suppliers it will be very hard for them to be able to source that commodity efficiently and effectively which will greatly diminish their ability to succeed in the market place. We chose McDonald’s because of its tremendous success in the global market place. We wanted to choose a company who everyone is familiar with and has been successful at what they do. Another reason why we choose this company is because we believed that, given its huge popularity, it would not be too hard to find information about it. We chose beef because we believed that beef was the company’s most critical commodity.
Company Description The McDonald’s Corporation is one of the world’s largest chains of hamburger fast food restaurants; it serves nearly 47 million customers daily. The first McDonald’s restaurant was opened in San Bernardino, CA in 1940; it now serves customers at over 31,000 locations in over 120 countries. The McDonald’s restaurant serves a wide variety of items on their menu including a large number of beef items. The most popular of these beef items include: the Big Mac, the Quarter Pounder, the Hamburger, the Cheeseburger, and the Big N’ Tasty. Our report will focus on the sourcing of the beef for these beef items. “McDonald’s beef procurement is operated through its four global geographic divisions; North America, Latin America, Europe and Asia/Pacific/Middle East/Africa” (Murphy, 2009). “They form what is termed the ‘McDonald’s Global Beef Board’” (Murphy, 2009). “All four procurement functions are involved in any significant changes in procurement in any of the other divisions” (Murphy, 2009). “McDonald’s is currently looking to leverage its global scale in order to improve its long term beef sourcing capabilities” (Murphy, 2009). Their new Worldwide Beef Supply Chain director Jose-Luis Bretones is “planning on working towards creating a more integrated global supply network, more open global beef trading options and a procurement system with greater flexibility overall” (Murphy, 2009). However, since McDonald’s is a global corporation with an extremely complex worldwide supply chain, our report will focus predominantly on the procurement of beef by McDonald’s to their locations in the United States. In the past McDonalds has bought mostly American beef for use in their U. S. estaurants and much of their beef still comes from within the country. However, according to McDonalds, “due to a well-documented shortage of lean beef in the U. S. , and to meet the needs of (their) customers, (they have started to)… purchase a relatively small percentage of high quality imported lean beef from New Zealand and Australia. (They) do this to supplement (their) domestic beef purchases” (McDonald’s Customer Response Center, personal communication, November 7, 2009). Description of the Commodity Beef is the name of meat that comes from cattle and other bovines (Travisl, 2009). It is typically served to consumers in the form of steak, burger patties and other ground beef products, hot dogs, beef jerky, roast beef as well as other dishes (Travisl, 2009). The United States, Japan, Brazil and China are world’s largest consumers of beef products (Travisl, 2009). It is a staple of the diet of a very large number of Americans (Travisl, 2009). The largest exporters of beef are Australia, Brazil, Argentina and Canada (Travisl, 2009). It is also heavily sourced from of Uruguay, Nicaragua, Russia and Mexico (Travisl, 2009). McDonalds’ hamburger patties are made of 100% pure beef, the beef is hand-seasoned on the grill with salt and pepper (McDonalds). The hamburger patties are grilled to a temperature of at least 155°F which is in accordance with the Food & Drug Administration (FDA) Food Code (McDonalds). Two substitutes for beef that are served at McDonald’s are chicken and fish.
However, many of McDonald’s customers would not be satisfied if they were forced to settle for fish or chicken due to beef being unavailable. Therefore, McDonald’s must make sure that they are able to consistently meet their customers beef demand. Part of this effort entails having an efficient and effective purchasing strategy.
Some companies may use beef to feed animals but McDonald’s has no use for it other than serving it to their customers to be consumed. Most of McDonald’s beef comes from USDA-inspected United States suppliers (McDonalds). In order to maintain demands, they import a small percentage of USDA-inspected quality beef from Australian and New Zealand suppliers (McDonalds). Angus burgers such as the Angus Bacon & Cheese, Angus Deluxe, and Angus Mushroom & Swiss are also menu items (McDonalds). The patties for these burgers are made of Angus beef “come from two Scottish breed of cattle (Black and Red Angus), which are naturally polled; that is, they do not have horns” (Drakew, 2009). McDonalds started to test hamburgers made with Angus beef at some of their restaurants in the United States of America. According to McDonald’s customer’s response to the burgers was positive and so they began selling the burger at all of their US locations in July 2009. Angus burgers are generally more expensive due to their beef being of higher quality than what goes into typical hamburgers. A portion of McDonald’s Angus beef currently comes from New Zealand. Since Angus is a specific type of beef, whose supply may differ from that of regular beef, McDonald’s should monitor its domestic production and supply and to determine if they might need to increase their foreign importation of the product or perhaps find a way to increase its domestic supply.
Depending on to what degree market forces for Angus beef differ from that of regular beef McDonald’s might have to pursue a different sourcing strategy for it. Industry Analysis McDonald’s Industry Although McDonald’s is a fast chain superpower and the largest buyer of domestic beef, they must still concern themselves with the competitive forces within their market to maintain their position as a market leader. Porter’s five forces model best outlines these forces, taking into account: market internal competition, threats of new entrants, pressure from substitutes, supplier bargaining power, and buyer bargaining power (Monczka, 207, SCM355). First it is necessary to define McDonald’s industry as the fast food industry, specifically the burger fast food industry, in which it is the industry leader. It’s key competitors, or market internal competition, are Jack in the Box, Carl’s Junior, Burger King, and Wendy’s/Arby’s (Northrop, 3). The high cost of entry into the fast food industry makes it unlikely that McDonald’s will face increased competition from new entrants in the near future. A new entrant would need to be able to achieve similar economies of scale to McDonald’s in order to be a real threat and that is unlikely to happen. However, the threat from substitutes is one that McDonald’s should be concerned over. Subway has nearly as many locations and differentiates its products from McDonald’s as the healthy alternative. With an increasingly health conscious consumer base and a menu that consist of primarily red-meat, high calorie items, McDonald’s is at a disadvantage when it comes to offering a healthy eating experience. In addition, YUM! Brands (Taco Bell, Pizza Hut, A&W, Long John Silver’s, KFC) has just as many locations collectively and competes with McDonald’s by offering fast food alternatives to burgers. Their menu items are similarly priced and served up just as quickly and conveniently as in McDonald’s. The buyer is the consumer in McDonald’s industry and in the food industry it is the consumer who has the last say. As previously stated, U. S. consumers are more health conscious than ever and there is increased pressure on McDonald’s to provide an overall healthier menu.
Lastly, there is the force of supplier power. There is no real substitute for beef from their perspective; McDonald’s cannot continue to do business if they do not procure the beef they need. McDonald’s has to be concerned over the cyclical shortages of U. S. lean beef because if their suppliers’ capacity is fully utilized they need to know where they are in the pecking order for their suppliers (Conagra, SCM455). Fortunately, as stated previously, McDonald’s is the largest buyer of U. S. beef and that allows them mitigate this risk. Supplier Industry Australia, the U. S. , and Canada are the dominant participants in world beef production, with McDonald’s sourcing the large majority of beef from the U. S. (Brocklebank, 7). There is internal competition between suppliers of beef for large, condensed farmland suitable for grazing. However, the strongest force for the supplier beef industry is the threat of substitutes.
The poultry industry is blessed with both multiple offspring and a short generation interval – an ideal situation for rapid genetic improvement” (Brocklebank, 5). U. S. fast food restaurants including McDonald’s continue to diversify menu offerings in an effort to decrease their dependence on beef. Economies of scale are greater for poultry and pork, and therefore so are their costs. Poultry and pork production has moved to large scale proportions and standardization levels that beef is likely never to meet. The beef industry faces the buying power of McDonald’s as well. McDonald’s buy is so great that they do not have to pay wholesale for beef. Although there is no data on exactly what McDonald’s pays for beef, it is reasonable to assume that they pay significantly less than the market wholesale price. It is possible that McDonald’s buys all of many of its suppliers supply, forcing the suppliers to meet most of McDonald’s demands, leaving them no other option but bankruptcy if they don’t oblige.
Although we have no idea if this is actually the case. Demand Analysis The total amount of beef that was consumed by the United States in 2008 was 27. 3 billion pounds (Mathews, 2009). McDonald’s U. S. purchases about 1 billion pounds of beef per year (Ishmael, 2003). Approximately 1/27 of all beef consumed by the United States is consumed by McDonald’s U. S. This should afford McDonald’s a huge economies of scale benefit. McDonald’s U. K. states that their current sourcing strategy includes: not searching on the commodity market for the lowest cost suppliers and sourcing only from dedicated suppliers who do not compromise on safety or quality, and not squeezing suppliers too hard on price but instead paying more for high performance (Food Chain Centre). Since McDonald’s U. S. alleges to have “the highest standards for food quality and food safety (including feed certification) in the fast food industry” (McDonald’s Customer Response Center, personal communication, November 7, 2009) it is reasonable to assume that their sourcing strategy is similar to that of their British counterpart’s. The immense amount of product that McDonald’s demands, puts them in a very powerful position. A beneficial course of action for McDonald’s would be to pursue a strategy of supply base rationalization and optimization, as opposed to sourcing from many different suppliers. This would put them in a good position to take advantage of economies of scale from those suppliers as well as insist on certain quality requirements (Monczka, 318 SCM355). If McDonald’s were to rationalize its supply base down to its best most dedicated suppliers and offer very large contracts to those chosen few, the use of economies of scale could help them achieve a price closer to, if not at the price offered by the lowest cost suppliers.
This way the company can stay within the confines of their current philosophy of only sourcing from the most dedicated suppliers while simultaneously minimizing costs. Additionally, with the size of the orders which McDonald’s would be able to place with a supplier it should not be too hard to get that supplier to comply with whatever reasonable quality requirements McDonalds might desire. One supply base improvement that McDonald’s might be able to achieve through supplier rationalization and optimization could be obtaining more American grass-fed beef. Although McDonalds currently sources most of the beef used at their U. S. establishments from within the country, a portion of it is sourced from Australia and New Zealand (McDonald’s Customer Response Center, personal communication, November 7, 2009). This is because, according to McDonald’s, “it cannot satisfy its need for lean beef by buying solely from American sources and has to turn to beef exporters outside the USA to make up the shortfall” (Mikkelson, 2009). “American beef cattle are primarily grain-fed and produce fattier meat, while grass-fed cattle (raised in Australia and New Zealand) produce leaner beef” (Mikkelson, 2009). Clearly, the company must incur significant logistics costs from having to transport the beef to America from the other side of the Earth. American ranchers claim that McDonald’s leanness standards are too high, and that if McDonald’s lowered its standards they would be able to supply the company with the lean beef that they need (Mikkelson, 2009). Or perhaps McDonalds could take advantage of their huge demand by giving contracts to American farmers that are large enough for the farmers to justify changing their cattle feeding practices. This would be a win-win supplier optimization solution (Monczka, 695 SCM355 and SCM455). The farmers would be able to increase their revenue and McDonald’s would be able to save money on distribution costs by sourcing the beef from within the country in which it will actually be consumed as opposed to having to source it from all the way across the world.
Additionally, buying beef for American restaurants from only American farmers would be better for McDonald’s from a public relations perspective. Supply Analysis The beef supply chain is not a cooperative one; there is little trust between those who engage in transactions up and down the supply chain. This puts it at a competitive disadvantage when compared to the supply chain of poultry and pork which has achieved much greater levels of coordination through vertical integration and complex contracts (Brocklebank, 6). Such a lack of integration across the beef supply chain makes it difficult for them to respond to changing consumer demands quickly. In 2008, the production of meat animals comprised over $66 billion of added value to the American economy (AssociationNational, 2008). In 2008, 34. million cattle were slaughtered and 26. 6 billion pounds of beef was produced (AssociationNational, 2008). More than 660,000 cattle are harvested in the U. S. on a weekly basis (AssociationNational, 2008). McDonald’s has to be concerned that it is highest in the pecking order for fulfilled orders by its suppliers. This is due to the fact that a “…large portion of beef production in the U. S. is boxed and sent to retailers for further processing…” (Brocklebank, 8). Suppliers of beef are at a production crossroads however. Although artificial insemination has increased the rate of breeding of beef cows, “…a beef cow only typically produces one offspring and there is a long lag between when a heifer is born and when it can be bred” (Brocklebank, 5). The point is the process of beef cow breeding is close to being optimized and that makes it difficult for farmers to keep the rate of increase of production even with the increasing rate of demand for beef. Cargill, Tyson Foods, OSI, Keystone and Lopez Foods are five of the American suppliers of beef to McDonald’s (McDonald’s, 2006: Gigeman76, 2009). Silver Fern Farms and Anzco are the two suppliers of beef to McDonalds from New Zealand (Morgan, 2009). FJ Walker Foods and Australian Food Corporation are the two suppliers of beef to McDonald’s Australia and are likely the Australian suppliers of beef to McDonald’s in the U. S. (Austrade, 2007). Due to shortages in the U. S. lean beef supply, McDonald’s was forced to look to foreign suppliers. A trend that is likely to increase as McDonald’s grows its business and increases market share as well as the world demand for beef increases. However, McDonald’s has to consider its brand image when deciding how much of its beef it sources outside of the U. S. When McDonald’s first began sourcing some of its beef from outside the U. S. there was an up rise by its U. S. suppliers. There were also concerns over the quality and production standards of beef sourced from other countries.
For example, beef sourced from South America was thought to have traces of dangerous pesticides because grazing areas were sprayed with them. However, all beef used by McDonald’s is USDA approved even if it is not necessarily raised in the U. S. Price Analysis Market Structure McDonald’s accounts for 19% of market share in the fast food industry. However, they dominate the Fast Food Hamburger Restaurant (FFHR) industry with 90% of the market share in 2008. Because each fast food hamburger restaurant offers similar menus and prices, the purchasing of beef is highly competitive (McDonald’s). Because of McDonald’s large market share in the fast food industry, especially in United States, the company has significant advantages when it comes to lowering production costs, lowering input costs and bargaining power over suppliers. However, they like every other company are susceptible to conditions of supply and demand when it comes to products they source. Also, external factors such as natural disasters and mad cow disease can cause changes in beef price. McDonald’s pricing strategy needs to account for these aforementioned factors.
The U. S. Cattle Supply and Trends Weather has significant control over the cattle supply because the availability of grass and wheat that is used to feed cattle in the summer and fall is dependent on weather conditions (McDonald’s). In order to make sure farmers have enough hay for the winter, they send surplus cattle to market, increasing supply in the short term, but reducing breeding stock and decreasing supply in the long run” (McDonald’s). Considering this fact, it might be beneficial for McDonald’s to purchase excess beef before the winter and stockpile it for when prices inevitably increase later on. Strong Demand for Beef and Forces Consumer spending on beef has grown $26. 9 billion over the past ten years, last year it was $76 billion (Association National, 2008). Per capita spending for beef in retail and foodservice was about $249 last year, an increase of approximately $50 from 2001 (Association National, 2008). “In 2008, per capita consumption of beef was 59. 9 pounds, compared to 59. 2 pounds for chicken” (AssociationNational, 2008). McDonald’s needs to take overall beef into account in their procurement strategy because it has an effect on price. The United States has historically banned cattle imports from other countries when tainted beef becomes an issue causing a decrease in available supply and a spike in price (Wolcutt, 2003). Such was the case in 2003 when an incident of mad-cow disease in Canada led to a ban of Canadian beef imports to United States, this decreased U. S. supply by 8% and caused a 30% rise in cattle prices (Wolcutt, 2003). McDonald’s must stay alert to any possible incidents of mad-cow disease or other beef tainting problems for both price and quality control reasons. Managing Price Changes in beef prices are predominantly effected by economic conditions of supply and demand. Hence McDonald’s, in their pricing strategy, needs to be conscious of the flow of market price fluctuations. There are two indexes that the company can use to do this: the Producer Price Index (PPI) and the Consumer Price Index (CPI) both of which are maintained by the U. S. Bureau of Labor Statistics. A consumer price index (CPI) is a measure that estimates the average price of consumer goods and services as well as changes in the price of those goods and services from one period to the next within a certain area (Cretog8, 2009). The percent change in the CPI indicates estimated inflation, the prices of a variety of different items such as beef, chicken, bananas, and eggs are available to be investigated in addition to their average price data. In addition to price fluctuations and inflation, McDonald’s should also take quality into consideration when deciding on what price to negotiate. When McDonald, as a buyer, purchases beef from their suppliers, the PPI may also give McDonald’s useful information concerning price fluctuations.
The Producer Price Index (PPI) “measures the average change over time in the selling prices received by domestic producers for their output” (Bureau of Labor Statistics), “it allows buyers to shift their pricing strategies by historical suppliers’ price change compared with the PPI” (Bureau of Labor Statistics). If beef suppliers are not following the market price trends and either not decreasing prices as much as they should or increasing prices too greatly, McDonald’s can use this tool to negotiate with suppliers while also taking into account such considerations as the company’s break-even analysis, quality requirements, or quantity discounts based on competitors’ pricing (Monczka, 398, 404, 275, 595 SCM455). Other sources of commodity price data are “Pink sheets”, and global commodity market data which are available at the World Bank website (Monczka, 398 SCM355). Through this price information about the domestic and international market, McDonald’s can observe economic market situations and commodity trends and alter their pricing strategy to confront them. Based on the price data from the “Pink sheets”, quarterly price changes of USDA Choice beef are as follows in the graph below. [pic] A USDA chart showing past beef production and average market prices is shown below: average market price per 100 pounds, and beef production in hundred million pounds (McDonald’s). [pic] [pic] The volatility of beef price is shown to the chart above (Triarc Companies). McDonald’s can use this information to estimate when to stockpile larger quantities of beef in order to hedge against anticipated rises in price.
Cost Analysis The production of beef incurs costs at many different levels. Beef production starts out with the cattle being raised. At this point the farmers who raise them incur such costs as the cost of the farm land, labor, and feed for the cows. After the cows are ready they are sent to a slaughterhouse and from there to a meet processing plant. The meat processing plants are where McDonald’s purchases their beef from. Since these plants are where McDonald’s gets their beef directly from, this is where they have good opportunities to cut costs. We do not have information about exactly what costs are incurred by each step at a meet processing plant but we do know that there are certain things that these plants can do in order to control their costs. McDonald’s should encourage their current suppliers to control costs as far as possible in order to obtain cost savings for both of them. For example, when it comes to what quantities of beef the plants should be ordered at a time; when frequent order are economical and it is possible to implement just-in-time inventory replenishment it is recommended that the plants use a lot-sizing technique called “lot-for-lot”. This is when the organization only orders exactly what quantities of inventory are needed for a certain period (Pearson, 214, SCM432). If making frequent order and implementing just-in-time inventory replenishment is not practical for the processing plant then it is recommended that they place orders in accordance with their “economic order quantity”. The Economic order quantity is the level of inventory that minimizes the total inventory holding costs and ordering costs” (Faridani, 2009). EOQ is a good lot sizing technique especially when demand is relatively constant (Pearson, 214, SCM432). Other ways of controlling costs include building and implementing close to accurate forecasts for labor schedules in order to make sure that there are enough workers to perform the necessary tasks for the day while ensuring that the company does not end up paying workers who do not need to be present. Also, the plants should make sure that their processing equipment is set-up and laid out in a way that minimizes errors and inefficiencies in their operations. If McDonald’s pursues a strategy of supply base rationalization and optimization and maintains close open relationship with their suppliers it will be easier for them to encourage their suppliers to take these actions.
After the beef is finished being processed it is sent to McDonald’s who sells it to the final customer. McDonald’s should also keep some of these aspects of cost control in mind if they want to keep costs down on their end as well. They also need to find to most cost effective way to order, store and transport the inventory. For example, it would be inefficient for the overall supply chain for them to order small lot sizes from a supplier that requires long runs to minimize costs. If they cause the supplier to incur greater costs those costs may end up being passed on to McDonald’s. Recommendations Since we do not have access to information regarding any price bids given by suppliers to McDonalds, the price that McDonald’s themselves or any of their fast food competitors pay for beef, or the costs that go into making a beef patty, our price recommendation will be market-based as opposed to cost-based. The change in the quarterly wholesale price of beef over the past few years has exhibited no discernable pattern or trend (Figure 1). Therefore, we believe that a moving average forecast is appropriate for forecasting the price of beef in the future (Pfund, lecture, SCM432). By taking a five year moving average for the wholesale price of beef we find that in the near future beef will probably cost around $2. 27 per pound for those buying it wholesale (Figure 1). However, given McDonalds’ tremendous demand and their opportunity to take advantage of economies of scale in procurement, they should clearly be paying much less. One large American buyer of beef whose price information we were able to access was the U. S. Department of Agriculture. The USDA has purchased about 31,384,000 lbs. of beef so far this year for various purposes (Figure 2). Although it is unclear exactly how many different beef suppliers the USDA has, it is likely that they take advantage of large economies of scale in their procurement practices because the price that they paid for beef in 2009 was about 69% of the average wholesale price for beef this year. The average wholesale beef price for 2009 was $2. 18 per pound (Figure 1) and the price that the USDA bought it for this year was about $1. 49 per pound (Figure 2). If the USDA, making a purchase of 31,384,000 lbs of beef, is able to buy it for that price through the use of economies of scale or other price reduction practices, then McDonalds who purchases 1,000,000,000 lbs of beef per year should be able to get it for at least an equivalent price if not less. 69% of $2. 27 (the projected price of beef in the fourth quarter of 2009) is $1. 56. Therefore, we suggest that McDonalds should set their target negotiating price for $1. 56 per pound for beef.
The greatest amount that McDonalds should pay for beef should be around $2. 27 per pound or whatever the average wholesale price turns out to be in the future because there is no way that an organization with the buying power of McDonalds should be having to pay full wholesale price for the item. If any supplier tried to charge them full wholesale price for beef we are sure that they could easily get a lower price by going with another supplier. According to the USDA efficiency gains obtained through larger and more commercialized livestock systems will cause a long-term increase in beef production after 2010 (Westcott, 2003). This increase in production however will be counteracted by a simultaneous increase in the domestic demand for beef, resulting in a net increase in beef prices in the future (Westcott, 2003). As a result, in order to ensure a continued steady supply of beef McDonald’s might have to increase their sourcing of beef from outside the United States in order to access cheaper markets. If the price of beef is expected to rise McDonald’s might want to try to establish fixed-price contracts with their current beef suppliers in order to lock in a price at the current market rate before it increases (Monczka, 508 SCM355). However, since suppliers might not agree to that type of contract, and since contracts do have to get renegotiated at some point, we have outlined procurement strategies below that go beyond simply locking in a low market price with a supplier. As we previously stated in the demand analysis, McDonalds needs to take advantage of economies of scale in their procurement process. They buy roughly 1/27 of all the beef that is consumed by the United States. Exactly what quantities of beef McDonalds buys from each of their suppliers is proprietary information. However, what we do know is the more product a company sources from a certain supplier the lower of a per unit price they will probably be able to get. Therefore, it makes sense for a company who buys so much of a certain product to use economies of scale in procurement to their benefit to as great of a degree as reasonably possible. McDonalds says that they do not want to simply seek out whichever supplier will offer them the lowest price, and they do not want to compromise on quality and safety (Food Chain Centre). We also know that beef is a critical commodity for McDonalds. We know this because it is critical to the success of McDonalds, it is a large expenditure for the company, its quality is critical, and because as a result of McDonald’s high quality standards there are probably not a very large number of suppliers for them to choose from (Monczka, 211, SCM355/SCM455). In order for McDonalds to get high quality beef at a low price they need to determine a small group of highly performing, well-trusted, strategic preferred suppliers and source their beef exclusively from them (Monczka, 211, SCM355/SCM455). In addition to allowing McDonalds to gain from economies of scale and guarantee that they are sourcing high quality products this will also allow them to achieve a high level of information sharing and continuous process improvement with each of these chosen providers (Monczka, 211, SCM355/SCM455). Of course before McDonalds chooses who these suppliers will be they must first go through a process of supplier evaluation.
One criterion that McDonalds might want to look at might be the supplier’s process capabilities; McDonalds must make sure that any supplier they choose has sufficient capability to process the amount of beef that they require (Monczka, 214, SCM355/SCM455). McDonalds should also asses each potentials supplier’s management capabilities, they need to make sure that they choose a company whose management is committed to continuous process and quality improvement, has a high level of professional ability, has sufficient experience, can sustain a good relationship with their workforce, and is willing and able to develop a close working relationship with the buyer (Monczka, 214, SCM355/SCM455). The financial condition of a supplier is also something that McDonalds should look at. McDonalds should also look at each potential supplier’s financial ratios in order to determine if a supplier can invest in the resources necessary to supply the company, if they can pay their own suppliers as well as their workforce, and if they can continue to meet their financial obligations (Monczka, 214, SCM355/SCM455). McDonalds would not want to begin a strategic sourcing relationship with a supplier who ends up going out of business. McDonalds should also evaluate the suppliers planning and control systems, these systems can have significant impact on the performance of the supply chain (Monczka, 214, SCM355/SCM455). Another important criterion for McDonalds to consider is the extent to which the potential supplier complies with environmental regulations, if the supplier is hurt by fines or sanctions from the government for violating environmental regulations it could hurt their customers too (Monczka, 214, SCM355/SCM455). Furthermore, since McDonalds claims to have “the highest standards for food quality and food safety (including feed certification) in the fast food industry (and state that they) use only the products that meet or exceed (their) highest standards” (McDonald’s Customer Response Center, personal communication, November 7, 2009) we are sure that they would want to thoroughly inspect any potential supplier’s operational practices to make sure that they meet McDonalds’ safety and quality requirements. Finally, McDonalds should make certain that the suppliers that they choose are able and willing to share the company’s goals, establish metrics to ensure an ongoing improvement of processes, and commit to having discussions on how to resolve issues in a manner that is mutually beneficial (Monczka, 215, SCM355/SCM455). Since we do not have access to any of this information concerning any of McDonalds’ actual potential or current suppliers, we cannot actually make any recommendations as to which beef suppliers McDonalds should purchase from. However we do believe, based on the information that we do have, that if McDonalds were to follow this strategy of sourcing from a few carefully selected strategic suppliers, it would help their ability to maintain a steady flow of beef in order to meet their customer’s demand at a price that is good for them. Pursuing a strategy of supply base optimization and rationalization will not only allow McDonalds to achieve a lower product cost, be better equipped to ensure the safety and quality of their beef, and be able to work towards continuous process improvement with their suppliers. It will also allow them to achieve lower administrative costs. By having to interact with fewer suppliers McDonalds will save money on the costs associated with those interactions in terms of time, effort and having to clear up any miscommunications (Monczka, 318, SCM355). The costs that McDonalds saves here could serve as a buffer against any price increases the suppliers may ask for during negotiations (Brown, lecture, SCM455). However, McDonalds should be aware that there are risks associated with the strategy of supply base optimization and rationalization (Monczka, 319, SCM355). Yet, most of these risks can be mitigated. McDonalds should make sure that they do not lose the advantage of a competitive market place and get taken advantage of by a supplier (Monczka, 319, SCM355). McDonalds can avoid this through selecting suppliers carefully and constructing contracts that emphasize continuous supplier improvement with them (Monczka, 319, SCM355). Supplier disruption is also something that McDonalds should look out for (Monczka, 319, SCM355). Occurrences such as natural disasters, labor strikes, vandalism, or problems with the supplier’s suppliers can prevent McDonalds from obtaining the inventory that they need (Monczka, 320, SCM355). This is one of the reasons why we suggest that the company source beef from a small group of suppliers as opposed to just one. Moreover, McDonalds might want to practice cross-sourcing which is a practice in which a company selects suppliers with multiple capabilities so that the buying company can source more than one product from them if they have to (Monczka, 319, SCM355). For example, when choosing chicken suppliers McDonalds may want to choose ones who could sell them beef too just in case something happens to all of their beef suppliers. Another strategy that McDonalds could utilize to keep their procurements costs down is stockpiling. The price of beef is somewhat volatile due to factors such as weather conditions, mad-cow disease, and economic situations in the area from which the beef is sourced. McDonalds should purchase large amounts of beef when they know they can get it for a relatively low price in order to stockpile it for the future when beef prices rise. McDonalds is well equipped to do this because they freeze their beef after it is bought. This gives them an advantage over competitors like Wendy’s who insist on never freezing their beef and would therefore have a harder time stockpiling this inventory (Wikinvest, 2009). Of course this approach should only be pursued to the extent that the increased holding costs that will be incurred from stockpiling the beef do not outweigh the cost savings gained from not having to buy beef at a higher price.
One more way for McDonalds to decrease the overall costs of their beef procurement is through the use of commodity derivatives to hedge against the fluctuations of beef price. “A derivative is a financial instrument whose payoffs and values are derived from, or dependent on, something else” (Ross, 2008, FIN303). If McDonalds believes that the price of beef is going to increase they could purchase a commodity derivative for beef for a certain price and date anticipating that that the actual price of beef on that date will be higher than the price stated on the derivative (Dye, 2009). This will allow McDonalds to purchase the beef on that date for the (hopefully) lower price stated on the derivative as opposed to the (hopefully) higher market price at that time (Dye, 2009). Although this investment tool, like all other investment tools, carries with it a certain egree of risk, some of McDonalds’ competitors already use it as a method of controlling procurement costs (Wikinvest, 2009). This strategy would also be in-line with McDonald’s new Worldwide Beef Supply Chain director Jose-Luis Bretones’ wish to implement the use of more global beef trading options into McDonald’s beef supply chain (Murphy, 2009). Appendix Figure 1 |Quarterly averages |Retail Wholesale Farm Byprod. Net Farm Total Whl. to Rt. Farm to W Fr. share 5mkt steer Fresh Rt. | 2006 |IV. |394. 4 |223. 1 |209. 9 |21. 3 |188. 6 |205. 8 |171. 3 |34. |47. 8 |87. 44 |363. 0 | |2007 |I. |405. 4 |235. 8 |218. 6 |22. 8 |195. 8 |209. 6 |169. 6 |40. 0 |48. 3 |91. 09 |368. 2 | |2007 |II. |426. 5 |241. 5 |226. 8 |24. 8 |202. 0 |224. 5 |185. 0 |39. 5 |47. 4 |94. 48 |379. 4 | |2007 |III. |417. 7 |222. 5 |221. 6 |25. 6 |196. 0 |221. 7 |195. 2 |26. 5 |46. 9 |92. 34 |381. 9 | |2007 |IV. |413. 4 |224. 4 |223. 2 |26. 1 |197. 1 |216. 3 |189. 0 |27. 3 |47. 7 |93. 01 |380. 1 | |2008 |I. |416. 3 |224. 8 |218. 5 |27. 3 |191. 2 |225. 1 |191. 5 |33. 6 |45. 9 |91. 05 |386. 9 | |2008 |II. |423. 6 |235. 3 |223. 0 |27. 3 |195. 7 |227. 9 |188. 3 |39. 6 |46. 2 |92. 0 |389. 2 | |2008 |III. |445. 9 |249. 7 |236. 9 |29. 5 |207. 4 |238. 5 |196. 2 |42. 3 |46. 5 |98. 72 |406. 5 | |2008 |IV. |444. 0 |229. 5 |214. 3 |20. 7 |193. 6 |250. 4 |214. 5 |35. 9 |43. 6 |89. 29 |404. 0 | |2009 |I. |433. 1 |216. 3 |197. 8 |16. 4 |181. 4 |251. 7 |216. 8 |34. 9 |41. 9 |82. 43 |396. 1 | |2009 |II. |429. 4 |221. 5 |202. 6 |17. 4 |185. 2 |244. 2 |207. 9 |36. 3 |43. 1 |84. 43 |391. 4 | |2009 |III. |417. 6 |216. 8 |200. 1 |21. 6 |178. 5 |239. 1 |200. 8 |38. 3 |42. 7 |83. 37 |381. 5 | |(Hahn, 2009) Figure 2 USDA 2009 Beef Purchases [pic] (USDA, 2009) Works Cited Association, N. C. 008. Beef Production Fact – Beef from Pasture to Plate.
Nov. 11, 2009. https://www. beeffrompasturetoplate. org/economics. aspx Austrade. Feb. 21, 2007. Mcdonald’s Australia – a case study of a multinational operating within the Australian economy. https://www. austrade. gov. au/ArticleDocuments/1454/EFF_mcdonaldscasestudy. pdf. aspx Brocklebank, Hobbs, Kerr. 2008. The North American Beef Industry: New Consumer Demands and Supply Chain Responses. Nova Science Publishers. New York Bureau of Labor Statistics. (n. d. ). Drakew, C. (2009, November 3). Angus cattle.
Retrieved from https://en. wikipedia. rg/wiki/Angus_cattle Dye, F. 2009. What are Commodity derivatives?. https://www. wisegeek. com/what-are-commodity-derivatives. htm Food Chain Centre. Sept. 2003. Mcdonald’s restaurants. www. foodchaincentre. com/FoodChainFiles/… /11%20Case%20Studies%20-%20McDonalds%20Restaurants. pdf Gigemag76. Aug. 8, 2009. Ibp, inc. https://en. wikipedia. org/wiki/IBP,_Inc. Hahn, W. Oct. 15, 2009. Beef. https://74. 125. 95. 132/search? q=cache:7q0ByBdR0gwJ:www. ers. usda. gov/Data/MeatPRiceSpreads/Data/beef. xls+%22%27Choice+beef+values+and+spreads+and+the+all-fresh+retail+value%22&cd=1&hl=en&ct=clnk&gl=us&client=firefox-a Ishmael, W. Apr. 1, 2003. What now Ground cow?. https://beefmagazine. com/mag/beef_ground_cow/ Mathews, Jr. , K, & McConnell, M. June 10, 2009. U. S. beef and cattle industry: background statistics and information. https://www. ers. usda. gov/news/BSECoverage. htm McDonald’s. (n. d. ). wikiinvest. Nov. 7, 2009. https://www. wikinvest. com/stock/McDonald%27s_(MCD)? ref=relatedpages#_note-27 McDonald. 2006. Food safety at mcdonald’s. https://www. mcdonalds. com/corp/about/factsheets. RowPar. 0001. ContentPar. 0001. ColumnPar. 0008. File1. ttm/Food%20Safety%20FACT%20SHEET. pdf McDonald’s. Meet our suppliers. https://www1. mcdonalds. com/qualityfood/meet_our_suppliers. jsp? DCSext. destination=https://www1. mcdonalds. com/qualityfood/meet_our_suppliers. jsp Mikkelson, B. Nov. 18, 2009. Ware’s the beef. https://www. snopes. com/politics/business/mcdbeef. asp Monczka, Handfield, Giunipero, Patterson. 2009. Purchasing and Supply Chain Management. Mason: South-Western, Cengage Learning.
Morgan, J. Aug. 26, 2009. Angus burgers to put $5m into kiwi farmers’ coffers. https://www. stuff. co. nz/national/farming/2794141/Angus-burgers-to-put-5m-into-Kiwi-farmers-coffers/ Murphy, M. June 19, 2009. Mcdonald’s fine tunes global beef supply chain. https://www. bordbia. ie/industryservices/alerts/Pages/McDonald%E2%80%99sfinetunesglobalbeefsupplychain. aspx? year=2009&wk=24 Northrop, Ann. SeekingAlpha. com. May 11, 2009. McDonald’s Chews Up Competition with April Sales Surge. Nov. 15, 2009. https://seekingalpha. com/article/136865-mcdonald-s-chews-up-competition-with-a pril-sales-surge Ross, Westerfield, & Jaffe. 2008. Corporate Finance. New York, NY: McGraw-Hill Irwin Professional Pub. Travisl. (2009, November 22). Beef.
Retrieved from https://en. wikipedia. org/wiki/Beef Triarc Companies. (n. d. ). wikiinvest. Nov. 12, 2009. https://www. wikinvest. com/stock/Triarc_Companies_(TRY) USDA. (2009, August 19). Food purchase report. Retrieved from https://www. ams. usda. gov/AMSv1. 0/getfile? dDocName=STELPRDC5078900 Westcott, P, Trostle, R, & Young, E. April 10, 2003. Agricultural baseline projections: baseline presentation, 2003-2012. https://www. ers. usda. gov/Briefing/baseline/present2003. htm Wolcutt, J. Nov. 26, 2003. The Christian Science Monitor – The price of beef becomes hard to swallow. Nov. 13, 2009. https://www. csmonitor. com/2003/1126/p18s01-lifo. html
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Radisson Hotel
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Bang and Ofulsen Case – Potential Answers
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Snake Venom
Intro “Each year around 1 million people world wide are bitten by snakes, and around 30,000 to 40,000 of the snake bite victims die from the venomous injection of a venomous snake. Of the 2,000 species of snakes, about 400 are venomous. The cobra, coral snake, and rattlesnake are common examples of venomous snakes. ” (Snake2). Knowing this information and more can possibly save yours or somebody else’s life when put into a situation when you have been bitten by a snake and can’t identify it, this paper will educate you on what to do in case of a snake bite and how the venom works on the human body. Snake bite- “the wound made by the fangs of a venomous snake or the teeth of a non-venomous one. ” (Snakebite). Snakes only bite to capture prey or protect themselves when they feel threatened.
When they feel threatened they give you warnings to tell you that they are about to strike. For example a rattlesnake will shake its rattle, a cobra will raise its hood, and the majority of the snake world will warn you with a loud audible hiss. Ways of Envomation “The process of introducing venom into a victim is called envenomating. Envenomating by snakes is most often through their bite, but some species, like the spitting cobra, use additional methods such as squirting venom onto the mucous membranes (eyes, nose, and mouth) of prey animals. ” (Reptipage 1). There are different types of delivery methods of delivery of venom. First you come to the short fixed fangs of cobras and mambas.
These fangs are fixed in the front of the snakes mouth and do not move when envenomating. In exception for the cobras there is the spitting cobra, which shoots out a jet of venom out of the hollow holes in the fangs. The snake usually aims for the eyes, nose, or mouth as mentioned above.
Then we come to the vipers, which have swiveling fangs, which swing forward like a hinge while striking. Then there are the rear fanged snakes, which most of them are in the colibrid family. These fascinating snakes have fixed fangs in the back of their mouth, which are actually just enlargened teeth, the strangest of these snakes in the stiletto snake. When the snake goes to strike, the fangs slide out of the side of the mouth and the snake strikes with the side of its mouth. It smacks its head on the victim and the fangs pierce the victim from the side of the mouth.
When the snake bites, it chews to get venom flowing. Most of the snakes in this family are mildly venomous and the power of the venom isn’t strong enough to do any real harm. Venom “Venoms are basically modified digestive juices, with a clear or yellowish tint to it. The components of venom cause the prey’s nervous system to malfunction while others break down muscles and blood vessels. Most venoms cause a multitude of effects that work in concert to paralyze and kill. The snake stores the venom in glands behind each eye that connect with enlargened teeth modified for injection. ” (Harvey 10). The Action of Venom “Snake venom is a complex protein substance and its exact composition varies from one species of snake to anther.
When a snake bites, it generally injects its venom though or near its fangs into the wound. Snakebite can even occur when the snake has been dead recently, or even by the snakes dismembered head because the snakes nerve reflexes are not extinguished for many hours. ” (Snakebite 2). A neurotoxin venom works to disrupt the function of the brain and nervous system. Classically, such snake venom causes paralysis or lack of muscle control, but it can also disrupt the individual signals sent between neurons and muscles. Such venoms can also attack the body’s supply of ATP, a nucleotide that is critical in energy transfer.
Researchers once believed that many snake venoms contained digestive enzymes to make it easier to process prey. However, this does not appear to be the case; snakes with digestive enzymes in their venom don’t digest prey any more quickly. More probably, such snake venom contributes to tissue death by literally eating the tissue away, accomplishing the snakes goal of incapacitating a victim long enough to start eating. Some animals have natural immunities to snake venom and immunities can also be induced through careful applications of processing the venom. This technique is used to make the venom used in snakebite treatments.
Because there are around 600 venomous snakes in the world, many nations have venom exchange programs, which ensure that hospitals and treatment centers can provide anti-venom from other facilities in an emergency. (Snakebite 1). Venom Composition “Snake venom has a great majority of proteins: some have enzymatic activity, some can block nerve or muscle cell receptors, and some have activity in the protein cascades for coagulation, complement fixation, or inflammation. ” (Reptipage 1). “Most snake venoms contain specific proteins that paralyze the prey so that it no longer moves, interfere with normal blood clotting mechanisms so that the anima goes into shack and then they begin the process of digestion by breaking down the tissues of the prey animal. ” (Reptipage 1). Toxicity (LD 50) Toxicity of venoms is usually expressed by LD50: the lowest dose that kills 50% of a group of experimental animals. That dose varies not just between the venoms tested, but also depends on which species of prey animals receive the venom.
Generally, the most toxic venom is the one with the lowest LD50. However, some snakes have venoms that are quite specialized for certain types of prey. Few studies have used the natural prey of a snake species, which would involve capturing a number of wild animals. Instead most research has used inbred strains of laboratory animals. Human susceptibility to snake venom is generally estimated from the LD50 for rodents.
The next factor in assessing the danger of a partiticular species of snake is the dose of venom that is actually introduced into the tissues. Some types of snakes have an extremely efficient mechanism of injection venom with a sing strike; others have poor success in doing so. The amount of venom produced by snakes that is available for secretion with a bite also varies between kinds of snakes, and between individuals (usually by size) of any one species” (reptipage 1). Symptoms of venomous snakebites. The symptoms vary not only with the type of venom injected, but also with the amount. A snake may release no venom at all, or it may release as much as 75% of the total amount stored in its venom glands. Often when a snake bites in self-defense, it injects less venom than when it attacks its prey. The physical condition of the victim and the location of the bite also affect the severity of the symptoms. A bite into a muscle is less dangerous than a bite into a blood vessel, for example, because toxins in the blood are quickly circulated through the body.
General symptoms of snakebite include localized pain and swelling soon after the bite occurs, followed by nausea, tingling or numbness, weakness, and shortness of breath. If victims do not receive treatment within a few hours, they may suffer convulsions, fall into a coma, and die. Even venoms that damage only tissue can be fatal within several days. ” (Snake venom 2). Listed below are different stages of snakebite symptoms: Paralysis “Some proteins secreted in snake venoms are toxins that affect nerves. (Neurotoxins) and the contractibility of muscle. Most neurotoxins in snake venoms are too large to cross the blood-brain barrier, and so they usually exert their effects on the peripheral nervous system rather than directly on the brain and spinal cord. Many of these neurotoxins cause paralysis by blocking the neuromuscular junction. In fact, biologists first learned some of the details of how the neuromuscular junction normally functions by using purified snake venoms in physiology experiments. ” (Reptipage 2). Shock “Many components in snake venom disrupt normal blood flow and normal blood clotting (coagulation). Some common enzymes in snake venoms increase bleeding by preventing the formation of clots, and others by breaking down established clots.
Both of these types of enzymes include metalloproteases. Other toxins increase ‘bleeding time’ by inhibiting the aggregation of platelets, the small odd-shaped blood cells that collect at the site of a tear in a blood vessel and form a plug to close it. Profound loss of blood can cause hemorrhagic shock, and disable a prey animal. When many tiny blood clots form in the bloodstream there is a pathological condition known as disseminated intravascular coagulation (DIC), which also causes shock. Some enzymes in snake venom set of DIC in the bloodstream of their envenomated prey by interfering with the activity of serine proteases involved in the regulation of hemostasis. ” (Reptipage 2”). Infarction (stoke and heart attack) “Toxins that set off clotting within the blood vessels of envenomated animals can cause both stroke and heart attacks. Infarction is a medical term that means death to tissues because of a block in their blood supply, and clots within the arteries of the neck and brain, as well as the coronary arteries can deprive the blood supply enough to cause infarctions in these organs. (Reptipage 3). Death!!!! When the circumstances are right, and enough venom is injected, if you do not receive medical attention immediately after the bite, you will DIE! Types of venomous snakes There are two major types of venomous snakes: 1. Vipers and 2. Elapids.
Vipers include rattlesnakes, copperhead, and water moccasins. Many vipers strike and release their victims quickly because their fangs can shoot venom instantly into the wound.
Elapids include cobras, mambas, and coral snakes. The fangs of an elapid snake do not deliver venom quickly; therefore, an elapid frequently hangs on to its victim and chews, forcing venom into the bite. In most cases, the wound from an elapid causes little pain at first. But later the breathing organs of the victim become partly paralyzed, and the victim becomes sleepy. Venom characteristics and venom delivery (according to family) The venomous snakes are represented in only four families.
There are variations in the methods of envenomation according to family. The families are listed below with information included about each of them. Crotalinae (crotalines) “ Common names of well-known members: Pit vipers, including lanceheads, moccasins, and rattlesnakes. “Pit viper venom characteristically contains a potent mix of enzymes that produce an emphatic degree of tissue destruction at the site of the bite. As with most venom, there can be both local and systematic effects. However, unless a bite by a pit viper is “dry” (meaning no venom injected), there will ordinarily be marked inflammation at the site of the bite and possibly systemic effects. Rattlesnakes range in size from small pigmy rattlesnakes (sistrurus) to large (many species of crotalus, such as the Eastern diamondback, (crotalus adamanteus) most pit vipers are potentially very active and aggressive snakes.
The strike can be lightning quick, measured in one study as less than 50ms. ” (Reptipage 2). Viperidae (viperids) Common names of well know members: pitless vipers, pit vipers “Bites by snakes of the family viperidae often induce local break down of muscle and tissues which may result in permanent deformity in the region of the bite (myotoxic phospholipases). Some types of vipers inject venom that travels through the blood stream and breaks down muscle cells systemically, with relatively little reaction at the site of the bite, but enough muscle cells throughout the body release their contents into the victim’s bloodstream to cause a condition know as rhabdomyolysis. In rhabdomyolysis (rhabdo=rod, myo=muscle cell, lysis=breaks apart) the large iron containing protein, myoglobin, is released into the circulation (myoglobulinemia). When myoglobin reaches the kidney, the renal system attempts to filter it out of the blood. If the amount of myoglobin is very large, acute renal failure results, and the blood is no longer properly filtered of even normal body wastes by the kidneys. The common names of vipers frequently fail to identify an actual species. For example, the name, rock viper, refers to two entirely different kinds of snakes. ” (Reptipage 2). Elapidae (elapids) Common names of well-known members: cobras, kraits, coral snakes, mambas, sea snakes, sea kraits, and Australian elapids “The venom of elapid snakes is notorious for the potency of its neurotoxins. These snakes have similarities in their venom compared to Vipers.
Venomous elapid snakes greatly range in size, aggressiveness and in habitat. ” (Snake bite 2). For example the king cobra (ophiophagus Hannah) is the world’s longest venomous snake, growing up to 5. 5m. (18. 5 ft. ) And the Coral Snake only grows to a maximum of 2 ft. “The main constituent of king cobra venom is a postsynaptic neurotoxin, and a single bite can deliver up to 400-500 mg. Of venom, about fifteen thousand times the LD50 dose for mice. The world’s most venomous snake is the Australian elapid: the small-scaled snake (oxyuranus micolepidotuscan) delivers up to 100 mg. Of venom with an LD50 dose of 0. 01 mg. kg) 1 giving it up to 500,000 LD50mice doses. Although sea snakes have some of the world’s most potent venom, the numbers of human fatalities from snakebites is apparently limited by their marine environment and behavior. For prey animals and in cases of defensive behavior towards humans, “neuromuscular paralysis usually occurs with elapid (cobra, krait, and mamba) envenomation”, however, many elapid snakes have venoms that also include toxins that cause bleeding. For example the venom of all contain metalloproteinases that interfere with platelet aggregation.
Besides neurotoxins and metalloproteinsases, there are additional types of bioactive proteins and polypeptides that are common in elapid venom. A second group of toxins are cell membrane poisons that act in a general fashion, but their chief effect is on the heart, producing arrhythmias and impaired contractility. The third group of toxins contains enzymes that break down protein and connective tissue.
These necrosis producing toxins are typical of the venom from the spitting cobras (naja spp. ) of Africa, china and Sumatra” (Reptipage 2). Colubridea (colubrids) Common well known members: boomslang This family of snakes contains about 2/3 of all living species of snakes. A minority has somewhat enlargened-grooved teeth at the back of the upper jaw for delivering venom under low pressure. This unsophisticated system for venom delivery makes it more difficult for scientists to collect colubrid venom for chemical studies than the venom from vipers and most elapids, which inject venom through front fangs under higher pressure. Often, colubrid venoms were collected only in relatively small quantities and with impurities from other mouth contents from the snake. As more recent collection methods have been devised that overcome some of these problems, researchers have discovered that earlier assumptions about the venom contents were sometimes mistaken. For example, phospholipase A2 (PLA2), which had been thought to be lacking in venoms in this family has now been detected in at least two species.
Some venoms show high toxiticity toward mice, and others are toxic to birds and/or frogs only. Because many colubrids feed on non-mammalian prey, lethal toxicity toward mice is probably only relevant as a measure of risk posed to humans. At least five species (dispholidus typus, thelotormis capensis, rhabdophis tigrinus, philodryas olfersii, and tachymenis peruviana) have caused human fatalities. ” (Snakebite 3). Atractaspididae Common names: Mole vipers, stiletto snakes, burrowing asps. “The Atractaspididae are a family of snakes found in Africa and the Middle East. Currently, 12 genera are recognized. No full experiments have been conducted on this specific species of snakes, but it is understood that the venom of the group is extremely virulent. ” (Wikipedia) “This family includes many genera formerly classed in other families, on the basis of fang type. It includes fangless (aglyphous), rear-fanged (opisthoglyphous), fixed-fanged (proteroglyphous), and viper-like (solenoglyphous) species. Molecular and physiological data linking this family to others is ambiguous and often contradictory, which means the taxonomy of this family is highly contentious. The nominate family, Atractaspididae has itself been moved to and from other taxa, reinforcing the ambiguity of this family. ” (Wikipedia 8). Treatment If a snakebites you, call an ambulance and if possible, identify the type of snake that made the bite.
Position your self or the victim so that they are comfortable. Keep calm and try to get your heart beating fast because it only spreads the venom more quickly. Tie a band above the bite. Make sure that the band fits snug with the skin, but loose enough that a finger can be easily placed under it. Do not loosen the band until medical assistance arrives.
The victim can drink water unless nausea develops. Do not give the victim aspirin, or any drug containing aspirin. Also do not give the victim any alcoholic drink, or any other form of alcohol. Do not attempt to administer anti-venom by your self or to cut the wound and suck out the venom. This does not help! Conclusion Snakes are not cold-blooded killers (although they are cold blooded) like the movies portray them to be. They only attack in defense and when obtaining food. If you happen to be bitten by a venomous snake, seek immediate medical attention. There are 4 basic groups of venomous snakes: crotalines, viperids, elapids, and colubrids. This information given in the report can possibly save yours, or somebody else’s life in a given situation.
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Snake Venom. (2017, Sep 21).
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“Perfect Sunday” by Jose Ayala and “Cathedral” by Raymond Carver
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"Perfect Sunday" by Jose Ayala and "Cathedral" by Raymond Carver. (2017, Sep 21).
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Global Transfer Pricing
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Global Transfer Pricing. (2017, Sep 21).
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Warming Up, Working Out, & Cooling down
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Warming Up, Working Out, & Cooling Down. (2017, Sep 21).
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The Influence Television has on Children
Children love to watch TV and prefer to stay “glued” to the TV screen all day, rather than playing outside. In the USA, 47% of children ages 2 to 18 years have a television set in their bedrooms. On a typical day, they spend on average of 5. 5 hours using media, including television, computer games and the Internet (Kaiser Family Foundation, 2001). TV is the number one after-school activity for 6 to 17 years old. Although television is loved by children and has helped them a lot, it has influenced them in a negative way. Over the past decade television has become a big part of a child’s routine. Even though many parents feel that it is just there for entertainment or another form to keep a child company o it still may have a negative influence on them without the parents or guardians even knowing. Even though many television sets or cable companies now have parental locks/guards children can still be influenced or exposed to negative behavior, not age appropriate language thru shows, commercials etc. Television does not only influence negative behavior but it also takes time away from a child’s social and educational time. Many children who watch a lot of television is likely to have lower grades, read less, even become overweight. In the past 10-15 years television has changed drastically. The amount of violence, sexuality, drug and alcohol abuse that is shown and really is the main theme of many shows today really does have an effect on a child’s way of seeing or portraying how life can be. An adult may see a television show with all of the above in it and think and know that all of is not real it’s just for entertainment. As, for a child they perceive it as being true, that it’s really happening or that it’s normal and safe to act or do the things they do. Especially if the parents allows them to watch the program. It may not even be a television show, it can be the cartoons that are now being done and how the news portrays the world and the events that occur. Many advertisements and commercials are even a bit too much for a child to watch. Many may agree that the way television shows are for kids now has changed drastically. Over the past years they have created so many networks like Nickelodeon, cartoon network, nick Jr, Disney, and many many others! There is even an option on certain cable companies to have the favorite shows available anytime of the day. Although many of the cartoons are harmless they do show violence and many of the shows do show a lot of being disrespectful, having different attitudes so when children, pre teens see this they think it’s cool or that’s how they should act because their favorite child actor or teen idol does it. There are a few decent programs and networks that do show positive and educational information. It may be hard for many parents to get very strict or to monitor every moment a child watches television because of how society is today. We now live in a time where both parents need to work everyone is very busy, you hardly see the importance of a family eating dinner around a table, if you visit someone’s home you would probably notice everyone is doing their own thing whether its mom or dad on a computer/laptop, a sibling playing video games while another is watching television or texting on their phone. So when a parent does notice or wants to cut back on television time even gaming it’s too late or becomes very difficult because the child has that routine and it can become difficult to change or even get the child to understand why they shouldn’t spend so much time playing video games or watching television. That’s when it becomes important to teach a child from when they are very small and also have limits for them. There have been debates on how television has changed. Many like the baby boomers cannot believe how different it has become. They remember just having cartoons on maybe 1 or 2 channels. Nothing like with how it is today. Many also don’t see the problem; many adults think its nice having the variety of different cartoons and programs for children because they didn’t have it while growing up. But, there are also a big percentage of parents who feel that some programs go too far and are concerned of what the future of children’s television will become. There are many ways that parents can do to help their children from watching so much television and getting them more involved in programs or simply just turning the television off for a few hours a day. Many articles simply state that if they don’t want to turn off the television they can watch television with their children and select the appropriate shows for them to watch. Others suggest having limits of the amount of television they are allowed to watch during the week. Simply turning it off during meals, and study time which also helps the child, so that they can see the importance to focus while studying and the importance of having meals with the family. For those parents who are always working or very busy then they have the option if their cable company offers it, they can block and set a timer for what they can see and how long they can watch the television. As time goes by if parents become more involved in what their child is watching then there’s hope for a change. It’s rare to watch regular television without hearing a curse word, or the image of sex or how the ideal man or woman is suppose to look like, so when children feed into all that it can send mixed signals of how they should be or act. So if parents become more pro active and simply monitor and become more involved then hopefully it can change overtime. And it would help the children become more involved with their school work; it would be able to change the rate of obesity and their behaviors. If parents or guardians voice their opinions more eventually someone’s voice would be heard and changes can be made. Until then since this is a way of life many parents should have more precaution and just be more aware
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Juvenil Crimes
Over the past years Juveniles have been fighting in court for being tried as adults. Many people agree or disagree on that decision, are they Juveniles, Children, or they adults? Writers like Adam Liptak, Marjie Lundstrom, Greg Krikorian, and Paul Thompson have maelstrom the ways of the mind of teenagers or consider their committed crimes to be adjured. The things that go through a teen’s brain are starting and unbearable to hear or imagine. Between the ages of 12 through 17, minors have been committing crimes that make their way down to death row. They look at juveniles on how unreliable and inconsistent they are on making bad decisions.
But often minors bring unparticular brutally attracting impulsive claims on their behalf’s on their crimes. Though the mind of a teenager’s brain is pretty much dazed out, meaning how would you think they could handle prison. Well people say if they can handle committing crimes they should put up with what should be disserved. This brought a concern to society should Juveniles be charge as adults? In the article assertions from Liptak, Lundstrom, Krikorian, and Thompson, bring us evidence of how juveniles are being tried as adults. These journalists bring concerning information on how teen’s react to hatred crimes that they commit.
Liptak and Lundstrom consideration against one’s opinion on how juvenile’s crimes should be thought are at most similar to one another’s thoughts. Liptak thinks that juveniles should be brought to thought, that they commit crimes to diminish their responsibilities to some of what of danger to themselves and others. Lundstrom says that they’re only kids until they mess up and commit crimes, then were more eager to call them adults. Krikorian believes that teens are “seriously impaired”, are less likely to recognizes the risks and don’t really think about the consequences.
Thompson finds that mathematical the brain system grows little until puberty corresponding with abstract concepts before then. Krikorian and Thompson have the agreement that teens are at a stage were they really don’t think because they are still kids and that they don’t know better. In the article “Supreme Court to rule on Executing Young Killers” By Adam Liptak, Robert Acuna was convicted of killing two elderly neighbors referring to “Execution Style” then stealing a car. Mr. Acuna was the latest person to be convicted with a death row sentence before the age of 18.
In “Kids Are Kids until They Commit Crimes” by Marjie Lundstrom writers about a 12 year-old savagely beated a 6 year-old girl to death, Lionel Tate said he was imitating his world wrestler icon. In April. Nathaniel Braizl was charged with first-degree murder at the age of 14, for shooting an English teacher that didn’t let him say goodbye to two girls on the last day of school. In “Many Kids Called Unfit for Adult trial…” by Greg Krikorian researched that teens are emotionally or intellectually unable to contribute to their own defense in court.
In studies shown thousands of Juveniles went to an adult trail when they shouldn’t because of their inability to stand the courts proceeding. In “Startling finds on Teenage Brains” by Paul Thompson discovers that the patterns of brain growth in children and teenagers. The brain is like a puzzle that grows fast at the point of learning skills. Also, that the massive loss of brain tissue happens in teenage years at risk taking, controlling impulses, and self-control. The Supreme Court, adjurors on executing young juveniles as killers and to be convicted as adults.
Young juveniles are incompetent on being well behaved as what Krikorian says “Seriously Impaired” or is that just an excuse? But knowing that you took a life is just unimaginable and horrifying. So if you did the crime now you’re going to pay the time. Even though your seriously impaired if you know that then why you take advance of that abuse and commit crimes. If you blame the teens you’re basically blaming the parents for unfit parenting their children. They don’t teach their kids form right or wrong and don’t control their kids.
So minors are what so to be punished for what inconsiderable parenting. Many juveniles are sentenced as adults for the crimes they commit at a young age being irresponsible. Their for they’re the one’s who should pay for the price they commit if they went against the law so the law should be put to justices. Teens are impulsive when it comes to things that are serious at times which they can’t really control themselves either. Juvenile’s commit crimes today like Homicides, Murder, First-degree murder, Second-degree murder, Voluntary manslaughter, and Involuntary manslaughter.
People who commit such horrible crimes should be taken seriously and let it be brought to justices. It doesn’t matter what characteristics makes a person an adult, a juvenile, or a child if you committed the crime at any age you should be held responsible for what you did so you should be tired no matter what. Juveniles are able to commit crimes but then, so they should be punished the same way as adults. Teens try to be like adult but they do it in an unfair manner to make them seem cool so when they “acted” like adults why not try them as adults give them what they want.
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Juvenil Crimes. (2017, Sep 21).
Retrieved November 5, 2025 , from
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What do you do for Good Health
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What Do You Do for Good Health. (2017, Sep 21).
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A True Love Story: School
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Cisco Systems, Inc.: Collaborating on New Product Introduction
1. What are the challenges faced by Cisco in introducing a major product like Viking? 1-1Time to market pressure There is only one year for Cisco to launch the Viking product to market with low cost. Otherwise, the market share might loss.
However, it is about 3 to 5 years for Cisco to launch a high-end product. To meet such tighten schedule, it’s imperative for Cisco team to perform a very collaborative operation and concurrent engineering in whole supply chain and NPI phase 1-2Cost pressure Bandwidth prices were constantly falling and customer expected continuous improvements in price-performance on their equipment. The competitor keeps intensive discount on price. Cisco had to implement most cost effective-supply chain at launch and product design. 1-3Technical complexity handling in contract manufacturing The product router contained about 300,000 components, about 30 times more than in a small business router.
How to successfully launch such a high complexity product in a low cost contract manufacturer like Foxconn requires Cisco monitor and cooperate with CM carefully. -4Continuous cost down pressure from emerging market Cisco needed to ensure that router would be attractive to service profiders worldwide.
Emerging markets were the fastest-growing part of Cisco’s business, which need lower cost. 2. In selecting Foxconn and involving it from the start (instead of doing a production launch in the US first before transferring production to China), what were the potential risks and values to Cisco? Potential risk: -Technical risk-Foxconn didn’t produce such complex product which may fail in fulfillment Cisco’s requirement in product quality and reliability. Foxconn has no experience on produce such complex product like Viking, which require Cisco spend lots of efforts, time and resource to develop with learning curve without guarantee on success.
-Foxconn failure in manufacturing qualified product to meet Cisco’s requirement will cause Cisco lose market share intensively, because the Viking is a very speed and cost sensitive product. Potential value: -Direct launch new product in Foxconn without transferring lead time from US which shorten the lead time for product to market. -Develop Foxcoon successfully can reduce the cost significantly from day one. This is big saving approach compare against transferring from US. Transferring approach initiate a high cost at beginning then work hard on cost reduction gradually which decrease Cisco competence on cost.
-Foxconn success in Viking production enables Cisco cost down in future high quality and high end product launch in Foxcoon with lower cost and shorten lead time. -Foxconn highly vertical integration gives lots of flexibility (fast response in schedule, capacity, synchronization, etc) in Cisco supply chain management. -Foxcoon’s strong bargain power in components and high economies of scale can support Cisco sustainable with lower cost. Foxconn will be developed from the beginning as one more the high-end products manufacturers, able to understand Cisco project management from inside the organization and become part in the portfolio of manufacturers making more flexible Cisco’s supply chain, because all their partners will be capable of manufacturing all Cisco’s products.
3. What should Cisco do to ensure successful development and launch of the Viking router? Cope with shorter lead time need highly collaboration internally and externally with partner like Foxconn. Internally, Cisco need handle cross functional teams and multiple sites work together with fine tuned work paces within limited timeline. Some IT platforms or tools like Cisco’s WebEx Web conferencing, TelePresence teleconference system, Cisco’s NPI Metrics are essential components to guarantee successful project management in Viking development and launch phases. Externally, a leak-proof linkage system assured technology links between Cisco and Foxcoon.
The Viking project status is transparence for both sides. The shared database like ERP enable engineers exchange information, knowledge and provide service like troubleshooting.
The accessible IT platforms supported multiple tasks and decision making proceeded without limitation on different locations and time zone. Train Foxconn in their new product introduction process; build an intercompany-multicultural team in charge to following up closely the project steps, interchange ideas and maximize the efficiency of manufacturing to reduce cost and comply lead times will be one of the main requirements to work aligned to their supplier to make a successful lunch. ——————————————END————————————
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Cisco Systems, Inc.: Collaborating on New Product Introduction. (2017, Sep 21).
Retrieved November 5, 2025 , from
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Evolution of Blond Hair
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Evolution of Blond Hair. (2017, Sep 21).
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Titanic Summary
Titanic Summary Titanic is a flawlessly crafted film that includes both a dramatic lavishing romance and the historical story of the sinking of the Titanic. It stars both the elegant star, Kate Winslet and the gorgeous Leonardo DiCaprio in a fictional romance that begins between a rich girl and a poor boy who meet on the voyage of the “unsinkable ship”, Titanic. It is narrated by an old woman known as Rose who claims to be a survivor of the Titanic and tells her experience on the Titanic to a group of treasure hunters, who are in search of a rare diamond in the Titanic's remains.
She tells about her unexpected encounter with a young, unwealthy artist named Jack Dawson who she falls madly in love with. This causes much drama for Rose and her family though because she had an arranged marriage to a conceited man named Cal. Jack sees the true Rose hidden behind the upper class snob. The two fall madly in love and plan to stay happily together. They never imagined such a devastating misfortune to happen on this indestructible ship and how it would change their lives forever. Nothing on Earth Can Come Between Them... ” Purpose of Movie Titanic was produce in 1997 by director James Cameron. The producer and directors purpose of this film was to bring the Titanic back to life.
They wanted to recreate this “Mother of all Shipwrecks” for viewer's to get a taste of what it was like the be aboard this huge vessel from its beginning to its last few minutes afloat. This tragic film was meant to show viewers how life can be unpredictable. You can never tell what fate lies ahead. Relevance to Me Titanic is relevant to me in numerous ways. Just as the movie has a heart-breaking disaster, I too, in life, encounter misfortunate events that come my way. For instance, when my great grandfather passed, it was a very unexpected life changing event that took place in both my family and my life. I was on a student ambassador trip traveling throughout Europe when I got an abrupt phone call from my mother explaining to me what had happened. It was not an occurrence that I could prepare for or predict to happen.
If it were so, I would have not went to Europe, and would have been able to support my family and friends after this misfortune occurred. Titanic relates to my point of view because I assume most, or if not all passengers that were shown in this film, knew what fate lied before them, they would have never boarded the ship. Not only can I relate to this tragic film, but probably others, if not everyone, can find one unpredictable event that took place in there lives. Overall, I am a huge fan of this movie. My opinion is this inspiring film has strong acting, outstanding effects, and one of the most captivating, irresistible love and historical stories ever created into a film. It is known as one of the top movies of all time and one 11 Oscars in its days. This legendary movie is hard to resist!
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Titanic Summary. (2017, Sep 21).
Retrieved November 5, 2025 , from
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Zara
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Zara. (2017, Sep 21).
Retrieved November 5, 2025 , from
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