Corporate Financing Report Essay Example | Topics and Well Written Essays - 750 words

Corporate Financing Report - Essay Example The company's chief also stated that this is done to increase the value of business for shareholders and to utilize the cash which is lying idle. The article is about financial management, because according to the fundamental principle, any cash lying idle is decreasing its future value. Therefore, all cash must be earning some returns too keep up with the future value. On the other hand if you look at the article critically, there are some weak arguments in it. When the firm says that it want to diversify to spread the risk, it should be aware that recession hits all the business and they may not be able to cover the losses. Similarly, firm will also have to make deep analysis about the future value of their investment. They cannot just invest in anything but they should make sure that they investing at the right place where the firm is not using future value of their cash, in other words, returns on this investment or profits should be greater than inflation rate in the country. Only this way future value of their money will remain stable and writer should have discussed this point in his article. If you have been able to crack a continued trend in the market about inflation rate and interest rate, you should adjust your capital spending on the basis of these. You should always go for those assets which are going to give you more return than inflation rate. ... you 12% returns whereas inflation rate in your country is 13%, then you should not buy this assets because you will be 1% worse off or your money value will be decreasing over time. Similarly, you should go for those assets which are giving you returns of more than the inflation rate and in this way purchasing power of money will not be deteriorating. Similarly, you should borrow money to invest in capital expenditure, only if it is deemed that you'll get more returns than the interest rate. If you buy an asset giving you 5% return whereas you have borrowed money at the rate of 8% then you will not be benefiting from that purchase but instead you will be losing money. So, identifying the market trend, it is imperative that all capital spending should be linked with inflation and interest rate. Such expenditures should only take play if the returns of this spending are greater than the forecasted inflation and interest rate. References James Pethokoukis, Reuters, Written on 10 June

Should Government assist business Essay Example | Topics and Well Written Essays - 1500 words

Should Government assist business - Essay Example up tariff schemes and other import restrictions; assists in foreign operations; provides for a postal system; conducts and encourages research and development; pays out vast sums for goods, services, and transfer payments; and helps in maintaining a sound banking system (Isaacs & Slesinger, 1964, p. 10). Therefore, the purpose of this essay is to illuminate the benefits of this assistance provided by the US government to business on economy and also about the burden it implies on the government and its policies and then come to a point to decide as to should government assist small businesses in their effort to be a part of internationalization by entering into export market. Encouraging exports is a primary concern of most governments. In the United States, the Department of Commerce has many programs devoted to the development and nurturing of beginning exporters. Substantial resources are devoted to export promotion programs designed to increase the propensity of small companies to export. However, while useful politically throwing monetary resources at a problem can be very wasteful. In the era of government budgetary problems and fiscal frugality, program accountability is part of every politician and administrators agenda. In the export promotions sector, the need to spend money wisely has emerged as a key concern. Government assistance refers to the policies that a government puts forth to help the exporter conduct international business. Studies have shown that governments can either help or hinder the export process. Typically, they help by providing information, sale leads, tax incentives, insurance, and financing programs. Czinkota and Ricks (1981) and Reid (1984) found that government assistance could stimulate export activity by providing relevant information. Governments can also hinder export decisions via their foreign exchange rate policy. Bauerschmidt, Sullivan, and Gillespie (1985) found that a high U.S. dollar relative to foreign currency

Employee recruitment in China

Employee recruitment in China Introduction The introduction of the ‘‘open-door policy in 1978 has sparked exceptional economic growth in mainland China. A significant driving force of this remarkable economic feat remains China as one of the worlds most attractive destinations for foreign capital investment. In 2008, â€Å"foreign direct investment (FDI) inflows reached US$109 billion and recorded a period growth of 41.1% in real terms between 2003 and 2008†. The Chinese government generally welcomes foreign investment and implements a wide range of incentive policies to foreign businesses (Euromonitor, 2010). With the growing importance of the Chinese domestic market to the world economy and introduction of government incentives, large number of international companies has established operations in China. The opening up of the vast market has formed many opportunities and, at the same time, created many problems to foreign enterprises (Siu Darby, 1999). This mainly because of the unique political, economi c and cultural environment different in China, it led foreign investors or expatriates manager difficult to introduce their preferred approach in managing the employees and the organisation in China (Siu Darby, 1999). Human resource management is one of the mostly frequently discussed ( Bjorkman Lu, 1999), as well as managing local Chinese employees away from ones home office is never an easy task (Gross, 2007). The purpose of this working paper is to review the major HRM challenges of multinational enterprises (MNEs) operating in China; the issues they faces when trying to apply global corporate HR policies in Chin with a focus on their justice implications. It begins with review of the recent China employment and recruitment situations, and then the evidences of challenges issues facing of MNE in Chinas HRM practices. In the following section includes several major HR critical issues in training and development and staff retaining. At the end of the section, major issues of employees management included leader developing, cross-cultural expatriates management and managerial effectiveness in cross-cultural are individually introduced. A research area is then identified in the conclusions. Recruitment Recruitment is about selecting and recruiting employees. The purposes of recruitment help MNE to meet the organization everyday jobs, legal and social obligations regarding the composition of the workforce. This increases organizational and individual effectiveness in the short term and the long term (Schuler and Huber, 1993). Analysed by most of the MNE industries, online advertising of recruitment is now a standard part of the recruitment process for them. It has been embraced by technology companies like IBM and cosmetics company Loreal in China evaluates their prospects from online recruitment (Xinhua News Agency, 2010). However, many multinational companies assume that a country with a population as large as Chinas would not have a labor shortage. In fact, the rising demand for Chinese labor has exceeded its supply, and hiring talented employees is even more difficult (Gross Connor, 2007). Chinas rapid economic growth has caused the countrys huge labour force faces difficulty i n providing the right skills needed for many foreign companies. Research found that this is mainly due to inadequate and out-of-date university training; graduates often do not possess the required skills including computer literacy and foreign languages. Cheap labour costs have long been history Chinas advantage over other developing countries which enhance the countrys competitiveness in attracting FDI. But Chinas booming coastal cities are now actually facing a shortage of manual labour, become a major issue for most MNEs manufacturing sector suffer in manual labour recruiting (CRIENGLISH.com, 2010). Guangdong, one of the economic powerhouses in South China Province, reported a shortage of half a million workers as business has skyrocketing for many companies (Xinhua News Agency, 2010). Some manufacturers closed down production lines because they could not find enough workers. â€Å"Low-wage workers are fading from the scene†, leading foreigner investors struggle with near double-digit unemployment (Xinhua News Agency, 2010). However, â€Å"higher wages could ease labor shortages by prompting factories to reduce their work forces† (New York Times, 2010). Hence the provincial authority has adjusted the minimum wage by an average of 21% to attract the labour mainly blue collar. â€Å"The rise will bring the minimum wage up to 1,030 yuan (150 U.S. dollars) in the provincial capital, Guangzhou, and to 920 yuan in Dongguan, a major manufacturing center† (Xinhua News Agency, 2010). Similarly to other booming regions like coastal cities of Fujian Province, Jiangsu Province and Shanghai City raised its monthly minimum wage rate by 13 percent to 960 yuan. According to Euromonitor (2010), â€Å"Chinas productivity stood at US$6,286 per person employed in 2009, significantly up from US$2,641 in 2004 owing to the countrys strong economic performance†. Critically, recruitment of factories manual labour is becoming an issue for many MNEs in China and employers have to increase their starting pay to attract them. Accordingly, the hiring of blue-collar is getting tougher and tougher in China because of one-child policy adopted by China in 1978. The parents with child born in late 1980 and early1990s are normally at middle-class income groups; as a result they can afford to send their children up to tertiary education. Overtime these groups of children are in the age of 20s now and are more educated and hence no longer willing to work in factories. They are far too optimistic about their career options and see no need to work hundreds of miles from their families. Besides, the new generation of workers born in the 1980s and 1990s are aware of their employment rights. For example, â€Å"unions have begun to aggressively exercise their rights by engaging in organizational efforts with large multinational companies such as Intel after informal discussions have failed† (Gross Connor, 2007). Commonly in China, Younger Chinese become major trends in the current labor market. They not only dem and higher pay but also ask for better opportunities for career development. Similarly, skilled middle managers are extremely sought after (Gross Connor, 2007). The Cultural Revolution had invaded the education of those born between 1950 and 1965 (Wang, 2002). During that time, people of this generation were sent to the countryside to work in agriculture. The so-called â€Å"Cultural Revolution Generations† in China are less recruit due to their lacking in skills (Gross Connor, 2007). While recruiting qualified Chinese labour is challenging from both of legal and human resources standpoint (BizTimes, 2007). Employers that are willing to take the time to understand the Chinese labour market and recent economic trend of employment will likely be successful. Training Training is mainly on-the-job and is seen as a lifelong process (Fischer, 2000). It focuses on employees knowledge, skills, attitudes and personalities (Human Resource Development Review, 2002). These enable staff members to discharge their job related skills and duties professionally and effectively (Grzeda, 1999). Training for newly hired employees have to go classroom curriculum like company policies, labor law, company culture, compensation packages, company expectations, company goals, company KPI (Key Performance Index) and of course hands-on equipment training (Kleiman, 1997). Companies in China for example in Electronic Industries spent between 1 to 3% from the overall input cost on training. (Xiao J Tsang M.C, 1999) But the number is gradually going up for a simple reason due to high attrition rate, particularly amongst the younger workers. The attrition rate always a worsening effect on the company as other FDI move in and attract those workers with managerial experience, offering better pay rates and further training opportunities (Randeree, 2009). The rich and wealthy companies are willing to pay handsomely for the experienced staffs of other companies and competitors. As in common, the culture of pinch staffs from one another is common in China (Wong, 1999). Despite Chinas high adult literacy rate of 94.5% in 2009, the countrys huge labour force faces difficulty in providing the right skills needed to support Chinas rapid economic growth (www.euromonitor .com). Research finding has showed the local Chinese graduates do not possess the required skills including computer literacy and foreign languages due to out-of-date university training. In order to cope with skills shortage problem, training programme provided in MNEs suit various needs (Cheung, 2004). They include overseas training programmes, on-site management skills development programmes and language courses (Wang, 2002). In fact, staff Training can help MNEs in China reduce turnover. Young Chinese professionals and graduates are attracted to the training opportunities that foreign companies can offer (Shen, 2006). Most of Chinese are not well-versed in spoken English language. Many MNEs send their employees for overseas training to enhance themselves in spoken English and true un derstanding of Western business practices (Waxin, 2007). Besides, it also creates a closer bond between employees and a better understanding of company culture (Ritchie et al., 2001). Rather than that, every company has their own training centre equipped with comprehensive training systems and real-live hand-on training equipments. Many of them have established their own training facilities. These programs have proven effective in building company loyalty and increasing retention (Meier, 1995). These may cost heavy, but they cannot do without it. Carrefour China, an example, established a Carrefour China Institute (CCI) in Shanghai in year 2000 to train Chinese managers (China Daily, 12 AUG 2008). Since then, the school has trained about 15,000 managers, and 40,000 employees have attended a range of training programs for self improvement. Regularly, a number of local managers are sent off to Europe for further training to gain greater overseas market knowledge and experience. Wal-Ma rt Chinas regional training centers, also located in Shanghai are other examples of winning internal training programs (Gross and Connor, 2007). Retention The most valuable assets of every MNE are its labor force; retaining them has become a challenge to company management because of varied employee needs (Som, 2005).Employee retention is critically benefited for an organization save the cost of turning over a staff position (Berry, 2008). For most MNEs in China, recruiting is only half the game. However, the biggest challenge that companies face, by a significant margin, is difficult to keep the talent employees as well as attract the excellent and qualified candidates among the masses. It is gradually increase complexity for companies in China to retain key talent, mainly as the lure of higher salaries affect the Chinese to abandon posts for more lucrative positions. Empirical study showed Chinese employees aged between 25 and 29 shift jobs most frequently, which implies this group of employees is the hardest to retain (www.mercer.com.hk). Hewitts 2009/2010 data shows that most Asian companies continue to experience double-digit volu ntary turnover rate, particularly China reported the top four markets which is the highest turnover rate after India, Australia and New Zealand (www.hewittassociates.com). Obviously, the high employees turnover rate has become the significant issue of most organization. Significantly, it has morale and financial impact on the daily operation of an organization (Cox Blake, 1991). While many would believe comparatively high turnover rate in China mainly due the competition for talent along with better wages offer from competitors (Byman, 2007). MNES move in and attract those worker with managerial experience, offering better training opportunities (Whiteley et al., 2000).The survey of ‘Employee Retention in China 2006–2007 sheds light on why employees determine to stay or leave and what organizations can do to stanch the accelerating outward flow of human talent (Howard et al., 2007). Survey respondents included 215 HR professionals and 862 employees in a wide range of organizations operating in China; while 81 % participants organizations were multinational (Work and life in China, 2008). To summaries the findings, the cause of turnover is the availability of better career opportunities elsewhere, particularly the growing entry of new MNES each year (Tung, 2007). HR professionals from survey described that competitors presenting a better salaries and sufficient compensation, but also noted the impact on retention of regional salary differences between Chinas coastal and inland cities (Howard et al., 2007). Not surprising, organizations that face high employee turnover often suffer negative residual effects among remaining employees. In short, the misunderstanding of employees needs is difficult for a company to retain and prevent turnovers (Branham, 2005).However, successful companies in China rely on a relatively small group of key talent to drive the business forward (Speth and Doeringer, 2006). The key strategy of MNEs applied to retain the talents further discuss in next paragraph. A high rate of turnover usually forces an organization to face difficult dilemmas (Wong. Wong. Hui Law, 2001) More and more people change numerous jobs within a year rather than choose to grow in one; and this has also been a problem for corporate management. Employee turnover demands management attention because it incurs costs in rehiring, training, placement, and motivating employees (Aberra, 2008). However,high employee satisfaction with working style of an organization should bode well for retention (Howard et al., 2007). Retaining often focus on opportunities for employers to promote the right employees or tangible rewards like compensation or remuneration based on appropriate performance appraisal (Whiteley et al., 2000). For instance, a comprehensive reward system can be a kind of rewarding either pay for hours worked or pay for pieces of work completed. Besides, most companies have retention bonuses to retain the key staffs and key talents. Some of the retention programs ar e sponsor for further educations, overseas training, stocks option and career advancement opportunities (Branham, 2001). Of cause conditionally, the employees who took the programs like further educations or overseas training have to be borne with company for number of years pending the amount spent. Commonly, talented employees would be less likely to leave the company ones if they are well compensated and motivated (Hong Chao, 2007 p. 217). However, sometimes retention method was inconsistent with its value in specific instances. Therefore, organizations should aware to these specialized occasions when developing strategies for retaining talent. Managing Employees Leaders developing For foreign companies operating in China, the difficulties are magnified by the talent shortage for future leader, particularly of managers and executives. For example, approximately 60% of companies surveyed in Hewitts 2003 Best Employers in China study reported shortages in leadership skills (www. hewittassociates.com). It further reported many talented executive have been lured away from an MNE job into a well-paid position with a leading Chinese company. For many foreign investors, developing future leaders tends to be very difficult in China mainly of rapid turnover. A good example is the America firm Leshan-phoenix Semiconductor Cooperation, in Sichuan Province, struggling with annual turnover rates of their local managers of 20% or more (onsemiconductor.com, 2010). This is mainly because demand for strong leadership executives far exceeds supply; they are tempted to leave their current position for higher pay and a bigger title (Meridian Resources, 2007). In fact, a competent leader helps multi-national corporations work effectively in the Chinese workplace. As foreign company enter fully into China marketplace, it forming competing domestically with local corporations. High turnover makes planned, consistent leadership development extremely difficult. Cross-cultural expatriates management China is the top expatriates destination followed by the U.S., UK, Singapore and Switzerland, survey reveals (kwintessential.co.uk, 2009). But, predicament comes from greatest challenges of expatriates failure grown concern for many multinationals in the evaluation of managerial performance (Leunga and Kwong, 1999). Evidence, empirical figures finds Western expatriate failures in China to range as wide as 25% to 70% (Harzing, 2002; Selmer, 2002). Significantly, such high failure rates potential impact business relationships between Western expatriates and Chinese organizations. Whereby, a financial loss can be inferred, due to damage to business relationships as a result of low commitment levels commited by expatriate (Lund Barker, 2004; Harzing, 2002). Lund Barker (2004) further cited such financial loss is estimated to range from US$250,000 to US$ 1,000,000 per expatriate. Further, Goodall Warner cited in Black (1988), 2007) showed there is high percentage up to 40% of expatriate managers terminated their foreign assignments early of their poor performance. Eventually it represents the organizational failure to manage human resources internationally (moinul.com, 2007). However, there might be several reasons why many expatriates fail to deliver the objectives. Research found that (Hays, 1974; Feng Pearson, 1999), they are three exact dimensions have been recognized as related with their overseas performance: the environment, the task, and the individual. This is due to expatriates are often faced with radically unfamiliar cultures, politics, language differences, length of assignment, and legal systems (Rahim, 1983; Feng Pearson, 1999). Sometimes, there is not inability from expatriates, but culture conflict affect local Chinese managers are less likely than their foreign counterpart to handle independent decision making responsibilities (Leunga Kwong, 1999). Chinese and expatriate managers may have different principles in judging within their job scope as well as criteria used for performance evaluation. Managerial effectiveness in cross-cultural Culture is an important contextual issue in employees management study. In general, management is closely related to the culture (Drucker, 2003). According to Wang (2002), the communist style of education and the long history of China differentiate the cultures of organization management between Mainland China from those of Asian countries, American and European cultures. This is especially true for MNEs who have operations on a global scale and employ people of different countries, ethical and cultural backgrounds. Cultural difference can have a direct impact on individual managerial effectiveness (Goodall Warner, 2007). It affects the motivation and satisfaction manager as well as staff; and effectiveness of key organizational systems such as recruitment, training, performance evaluation and rewards (Goodall Warner, 2007). Sometimes cultural sensitivity drove the management effort since the different in culture of management concept. Take the case study of Japanese T.L. Electroni cs Company based in China for example, the Chinese workers commented the style of Japanese management is not conductive their expectation (Whiteley et al., 2000). It is generally assumed the HR management approach is due to remarkable cultural difference between the parent country and the host country. In fact, a MNE should focus on a combination of global integration and local adaptation, allowing its employees to â€Å"think globally, act locally†. To ensure global thinking, the global company has to encourage the local employees to accept the corporate culture and values. For instance, Chinese employee who employed in the Western setting is encouraged to learn the Western-style organization management and communication skills. Meanwhile, operations of the Company have to adjust to comply with the legal requirements and services that reflect the Chinese culture. Conclusions In conclusions, recruiting the right people, training in right time, retaining the best staff, and employees empowerment of recent human resource management are difficult tasks for any MNEs operating in China. Chinas rapid economic growth has created more job opportunities but it also creates more opportunities for labour turnover to others organizations with higher paid indeed. This heavy labour turnover in China has been a substantial problem in managing Chinese employees .This hindered many multinational corporations localization plans because those talents who have been trained for succession have usually ended up as the focus of aggressive recruiting efforts by other organizations. Eventually, they face a dilemma of whether it is worthwhile to invest in better compensation packages and training programs, because it might possible happen with the employees leaving the organizations at the end. However, every issue has its balanced view of its advantages. Still, China Government, Provincial Government, City and Town Government give the best support to foreign investors in terms tax rebate, , free land, training cost subsidizes and so forth. Even though the labour cost (cost on training and wages) is growing fast in China but it is still cheaper than America, Europe and most of well to-do countries in Asia like Japan, Korea, Singapore, Taiwan and Hong Kong. At least, the great population of China is having highly educated workforce with hungry for knowledge, it is easily trainable. References Xinhua News Agency, 2010. ‘Chinese manufacturers learn to love labor lost http://news.xinhuanet.com/english2010/china/2010-03/25/c_13224772.htm Gross, A., Connor, A. (2007). China Recruiting and Retention Issues http://www.pacificbridge.com/publication.asp?id=81 BizTimes. (2007). Employee recruitment in China is challenging New York Times. 2010. ‘Defying Global Slump, China Has Labor Shortage http://www.nytimes.com/2010/02/27/business/global/27yuan.html

Solutions to Sustain Freshwater Essay -- Water Scarcity Environment

Would it be possible for humans to live without water? The answer is no because fifty percent of water is inside human bodies. In other words, water supports human lives, so every person is supposed to drink at least two litres of water everyday because it predominantly prevents them from being dehydrated. In terms of being the priceless resource, water is used in many fields such as agriculture, industry, business and so on. All preliminary products are comprised of water. Due to the abundance of water, most people seem not to be concerned about the way they consume this crucial resource. For example, in some countries, there are no dirty water treatment systems practising, and everyone can use water as much as they can as the price of water is cheap, too. However, in some countries, they lack water to access regularly and need to do trade with others in exchange for water. Also, Rogers (2008) notes, â€Å"that the problem is well-known makes it no less disturbing: today one out of six people, more than a billion, suffer inadequate access to safe freshwater† (As in New Delhi, para.3). There is no limit of the use of freshwater between one country to another, and it depends on the place people live. Even though there is a lot of freshwater available on the earth, we, people, should be worried about the proper water consumption. In order to thwart the water crisis from occurring one day, we should reverse our trend of using water by desalinating seawater, recycling waste water and reducing the unnecessary demand of water. The first solution to deal with the problem of water scarcity is to desalinate seawater. Getting freshwater from the sea is taken into account because seawater is much more than freshwater in reality. As Villiers (19... ...hwater is vital for humans to survive, but they should be more concerned about the problems of water scarcity that can happen in the future. Everyone should start to adapt these solutions such as desalinating seawater, recycling waste water and reducing water demands in order to maximize the fact that there is still the abundance of freshwater to use in a long time. Works Cited Reimold, R. J. (1998). Watershed Management: Practice, Policies, and Coordination. NY: R. R. Donnelley & Sons Company. Rogers, P. (2008, August). Facing the Freshwater Crisis. Retrieved November 19, 2009, from http://www.scientificamerican.com/article.cfm?id=facing-the-freshwater-crisis&page=5 Thomson, S. A. (1999). Water Use, Management, and Planning in the United States. Toronto: ACADEMIC PRESS. Valliers, M. D. (1999). Water. San Diego: Stoddart Publishing Co. Limited.

Neoliberal Policies in the development of the International Economy since the early 1980s Essay

International Economy has always been volatile as it is subject to the activities of the market itself and the market players. Since global in composition, all countries constituting the international arena have a significant effect in the economy as a whole. Neoliberalism is a school of thought that traces its beginnings in Neoliberal Manifesto; it believes that social progress can be attained through economic liberalism. Therefore, it believes that social aggrandizement can be made through transferring the control of the economy from the public (government) to the private sector. It advocates that since the private sector is more adept in handling the economy it is righteous to have them control it so that results will be favourable for all, economy-wise. While this move dismantles competition and espouses oligarchy and monopoly, John Williamson (one of the premier minds behind Neoliberalism) argues that it is for the best interest of the nation as more business and firms will be built. It embraces ten points of contention. The first being the Fiscal policy where deficits are seen to be used only under occasional stabilization purposes, it therefore believes that large deficits should not be run by the government as it will only be paid later on by the citizens. It has a great tendency to lead to low productivity and inflation. And no country would like to experience inflation as it is tantamount to economic suicide. Second is the redirection of subsidies to public spending; while subsidies has is purpose, the truth is there are more people in need of more services and it is the responsibility of the government to aid them. The government spending will focus on education, health care and infrastructure development. This espouses emphasis and control of the government to social sectors. Social Welfare should be one of the key priorities of the government. Third is Tax reform which aims to adopt moderate marginal tax so that citizens will be encouraged to innovate and be efficient. This means that people are actually encouraged to be active participants of the market and not mere observers. Fourth is floating exchange rates which imply that the value of the money is volatile, it can go down or up depending on the performance of the currency. This only means that there are many rooms for development as the exchange rate is not fixed, only it has its equivalent risks. Fifth is trade liberalization which affirms the dismantling of quantitative restrictions in order that competition will be encouraged and the quality of products that will be produced will grow more and more. This does not only motivate people and firms to work hard but also to innovate, to invent new things and develop new ideas so that the buyers will purchase their products. Sixth is Liberalization, while the fifth focuses on trade, this one embraces monetary trade that opens the doors for people to invest their resources overseas and in turn to attract foreign investors as well. It works both ways, letting the market run from one country to another thus strengthening trading tie between and among nations. Privatization of state enterprises is one of the most interesting points of Williamson as it gives more power to the people. It battles monopoly by opening to the private sector the opportunity to create firms and companies that will provide services similar to that provided by governments, it brings about venues for competition and more importantly choices for the people. Deregulation is basically removing market restrictions. As market restrictions tend to limit competition it also promotes standards both for quality and security. Deregulation removes the market restrictions but retains those with lawful justifications and phyto-sanitary standards. Legal security for property rights is the 9th point and is seen as protection for the public as they are given exclusivity to their rights. No one from the government or the government itself can claim ownership over one’s property, which again empowers the people economically and politically. And finally the Financialization of capital. This promotes more power to the economy. Neoliberalism inspired the many changes in the International Economy in the 1980s. As more and more people understand and see the benefits of having an economy that operates on its own more and more people supported and adopted it. The 1980s was a time of Economics transformation. It was the inspiration for the collapse of Communism, countries like Yugoslavia and China freed themselves from the Communist ideology as they embrace liberal policies in economics. Democratic countries further supported the cause of neoliberalism as they focused on economics individual right where not only firms and institutions get to be play and participate in the market but people as well. Governments also prioritized free trade. Since neoliberalism is a rather new idea, nations cannot abruptly turn 360 degrees to embrace it, therefore the changes were implemented in moderation but created great impact in several of the most stable and prolific economies of the world. Two of the most important people in the 1980s were greatly influenced by economic liberalism, they are Margaret Thatcher, United Kingdom’s Iron Lady and United States’ 41st President, Ronald Reagan. Both of them had the same understanding and view with regards to economy, they were determined to propagate neoliberalism as they see it very efficient and effective for majority of the markets. Reagonomics, the term used to refer to the economic policies of then US President Ronald Reagan was anchored greatly in neoliberalism. Its four pillars were close to the ideas promoted by neoliberalism. The four pillars were to reduce government spending, to reduce income and capital marginal taxes, to reduce government regulation of the economy and control money supply to reduce inflation. The four pillars can be found in Williamson’s 10 points of contention as well, only re-affirming that Reagonomics was inspired by neoliberalism. Historically, the United States faced inflation and massive unemployment before Reagan’s presidency. His strategy of reinventing the approaches to the American economy was greatly different from the Presidents before him as they embraced monopoly and state governance instead of free market. Margaret Thatcher worked to the best of her ability to dismantle trade barriers and limit the intervention of the government in the market. This may sound ironic as the n Prime Minister Thatcher is the head of government but she is actually reducing the power of her office. This only tells us that the leadership of Thatcher wanted so badly to rebuild the status quo when it comes to economic policies. This also suggests that the Margaret Thatcher paid emphasis to the importance of economic stability in achieving political stability. At that time, neoliberalism was the key to advancement both socially and more importantly politically. In turn, industries increase its shift from locally to globally. Therefore integrating the different and varied economies of the world to arrive at a compromise and a common ground to negotiate and maximize the utilization of the world’s resources. Not only are the tangible resources shared but the intangible ones as well. Research and development was able to advance because of the collaboration of various minds giving different perspectives to a specific subject. The effects and influence of neoliberalism were vast, not only was it seen and accepted in the West but in all other parts of the world. In key countries like Australia, Canada, Japan, Scandinavian countries, United Kingdom and United States, neoliberalism was greatly accepted even in striving countries like Chile and South Africa. Even Latin American countries which embraced and adopted neoliberalism achieved economic gains as they became less dependent on imports from foreign countries and achieved urbanization. Neoliberalisms’ effects can be summarized in several points. First is the growth in international trade and cross – border capital flow. Since neoliberalism espouses freedom in economy, therefore eliminating and limiting trade barriers nations are given the lee way to trade with whoever they want as long as legal standards are respected. This way, the capitals are maximized and other opportunities for business are explored not only locally but internationally as well. In relation with the first, the elimination of trade barriers is one of the major legacies of neoliberalism. It is perhaps its essential value; people and firms are no longer under the role of government standards. The rules made are made essentially and specifically for economic purposes and aims in mind, unlike the trade barriers which is more government – serving. And last, privatization of public owned companies. Among all the many legacies neoliberalism left us, the privatization of government operated companies is probably the most beneficial for the public. As the private sector handle the previously government owned companies (example: telecommunication, television and water systems) the buyers and purchasers are given more choices, more quality and more products. Since the market is now open and anyone can put up a telephone or television company, the present business owners will be driven and pressured to keep on improving their services as competitors are everywhere, next they need to constantly modernize and innovate so as consumers will have something to look forward to, in the same way that it makes them ahead of the competitors. And lastly, the market is controlled by people who are focused on economy, unlike when a company is controlled by the government the focus of the company is torn between economic purposes and government aims. It is also believed that economic freedom brings about better standards of living, it attracts investors and finally pushes technology to do and achieve more. Political Scientist Thomas Friedman said that political freedom can be achieved when there is economic freedom. As politics and economics are gravely intertwined with another, when the economic composition of a nation is controlled by a certain sector of the society, the political control is on its side. While, if there is economic liberalism, the economic sector and political sector can serve as checks and balances of one another, therefore securing that both sectors are doing what they are supposed to do. Friedman also noted that economic power should be separated from political power as the tendency to abuse and be abused is so vast. However, critics of neoliberalism believe that economic liberalism bastardizes the concept of a nation’s right to self – determination as the government loses its hand over one of the most important divisions, the economy, it assumes that the once a government has limited access over its economy the state itself becomes weaker. Capitalism is also viewed as a tool to exploit; because everything is market and results – driven critics say that the poor will only get poorer and the rich richer because the market is controlled by the rich. However, proponents of neoliberalism that Capitalism only maximizes the resources and provides limitless opportunities for people who are willing to grab them. In summary, the effects of neoliberalism in the movement of the international economy is incomparable. It is one of the few schools of thought that was accepted and supported worldwide and later on became the model of how economies should function. Although perceived by some to be exploitative and conflicting with the government, the benefits it had done to countries and nations which have adopted its policies are clear and surviving, from the 1980s to this day. And more and more economies continue to grow and strengthen as the further enhance the legacies left behind by neoliberalism.

The Consumer Complaint Behavior

The consumer complaint behavior, CCB in short, is an area of research which deals with the identification and analysis of all the aspects involved in the consumer reaction to a product or a service failure and the consequent perceived dissatisfaction. A growing interest for CCB starts appearing toward the middle of the '60s as a particular aspect of a general attention for consumer behaviors and attitudes. Consumer satisfaction, dissatisfaction and consumer complaint behavior, in particular, are three distinct, but highly correlated subjects investigated by marketing and consumer studies.Real marketing problems can be considered at the origin of these studies. The growing competition in the market, the developing consumerism, the importance given to quality, performance and satisfaction, the emphasis given to customers, considered at the Centre of a product or of a service, bring researchers to inquiry about the complex mechanisms which determine customer satisfactions or dissatisfac tion and what are the consequent consumer behaviors.At the same time, as the research is deeply rooted in real life, the findings of the studies are aimed at identifying and suggesting managerial and practical solutions directly applicable to markets or services. As far as CCB research is concerned, the main aspects investigated can be summarized according to the some questions. The proposed list is anything but exhaustive: 1. Why do people complain? 2. Why do people not complain? 3. To whom do people complain? 4. Facing an unsatisfactory product or service, what are the possible reactions available for a customer? . Are there any differences in CCB according to the product or the service investigated? Being a Customer Relationship Manager of a luxurious hotel in Penang I received a mail from Mr. Stanley. He and his family stayed at my hotel last week. He has complained that the quality of food served was not satisfactory, hotel staff very impolite and not helpful and his computer n otebook and some cash was missing from his hotel room. Also he has criticized the hotel staff members that they do not listen to his complaint patiently. Firstly, I will send Mr.Stanley a letter of apologize and tell him about we will take further step even when full resolution is likely to take longer because fast acknowledgment remains very important and this action helps to build rapport with customer, the ? rst step in rebuilding a bruised relationship. In this letter I would not argue with Mr. Stanley and the goal should be to gather facts to reach a mutually acceptable solution, not to win a debate. Arguing gets in the way of listening and seldom diffuses anger. Next, I will show that I understand the problem from his point of view.Seeing situations through his eyes is the only way to understand what he thinks has gone wrong and why he is upset. Service personnel should avoid jumping to conclusions with his interpretations. Besides that, I have to clarify the truth and sort ou t the cause. Mr. Stanley says my hotel staffs are impolite, the food served is not satisfied and hotel members didn’t listen to his complaint, it may result from inefficiency of service, misunderstanding by Mr. Stanley, or the misbehavior of a hotel staff or third party. If I’ve done something wrong, I will apologize immediately. The more Mr.Stanley can forgive me, the less he will expect to be compensated. I would not be defensive because acting defensively may suggest that my hotel has something to hide or is reluctant to explore the situation fully. Furthermore, I will provide Mr. Stanley the bene? t of the doubt because not all customers are truthful and not all complaints are justi? ed. However, he should be treated as though they have a valid complaint until clear evidence to the contrary emerges. Because Mr. Stanley miss some cash money and computer notebook from his hotel room so careful investigation is warranted.Because the amount involved is not small, it ma y be worth haggling over a refund or other compensation. However, it’s still a good idea to check records to see if there is a past history of dubious complaints by the same customer. Propose the steps needed to solve the problem. When instant solutions aren’t possible, I will tell Mr. Stanley how my hotel plans to precede shows that corrective action is being taken. It also sets expectations about the time involved and I should be careful not to overpromise. I have to keep Mr.Stanley informed of progress because nobody likes being left in the dark and it may cause uncertainty breeds anxiety and stress. People tend to be more accepting of disruptions if they know what’s going on and receive periodic progress reports. Moreover, I have to consider compensation. When Mr. Stanley do not receive the service outcomes he believes he has paid for or have suffered serious inconvenience and loss of time and money because the service that hotel provide are failed to delive r to him, I might offer an unconditional money back guarantee and tell Mr.Stanley if at any point during the search process he is unhappy with progress, simply address the fact with us and if we are still not 100 percent satis? ed after that discussion, I will cheerfully and unconditionally refund every cent he has paid as a retainer. No quibble, no hassle, guaranteed period. This type of recovery strategy may also reduce the risk of legal action by an angry customer. Service guarantees often lay out in advance what such compensation will be, and hotel should ensure that all guarantees are met.Whatever is promised in the guarantee must be totally unconditional, and there should not be any element of surprise for the customer. The guarantee has to easy to understand and communicate to Mr. Stanley so that he is clearly aware of the bene? ts that can be gained from the guarantee. Meaningful to Mr. Stanley in that the guarantee is for something important to him and the compensation shou ld be more than adequate to cover the service failure.Guarantee has made must easy to invoke It should be easy for the customer to invoke the guarantee and it also have to easy to collect on because If a service failure occurs, the customer should be able to easily collect on the guarantee without any problems. Lastly, guarantee has to be credible and be believable. Persevere to regain Mr. Stanley goodwill. When Mr. Stanley has been disappointed, one of the biggest challenges is to restore his confidence and preserve the relationship for the future. Perseverance may be required to defuse is anger and to convince him that actions are being taken to avoid a recurrence of the problem.Truly exceptional recovery efforts can be extremely effective in building loyalty and referrals. Also I will check the service delivery system and pursue eminence. Because Mr. Stanley has left, I should check to determine whether the service failure was caused by accidental mistakes or system defects. I ne ed to take advantage of every complaint from Mr. Stanley to perfect the whole service system. Even if the complaint is found to be a result of a misunderstanding by Mr. Stanley, this implies that some part of my communication system is ineffective.But while we discussed the importance of professional complaint handling and service recovery, we have to acknowledge that not all complaints are honest. When ? rms have generous service recovery policies or offer guarantees, there is always the fear that some customers may take advantage. Also, not all complaining customers are right or reasonable in their behavior, and some may actually be the cause of complaints by other customers. We refer to such people as jaycustomers. Every service has its share of jaycustomers. Jaycustomers are undesirable. At best, a ? rm should avoid attracting them in the ? st place, and at worst, a ? rm needs to control or prevent their abusive behavior. Let us ? rst describe the main types of jaycustomers befo re we discuss how to deal with them. De? ning a problem is the ? rst step in resolving it, so let’s start by considering the different types of jaycustomers. I’ve identi? ed seven broad categories. The Cheat – There are many ways in which customers can cheat service ? rms. Cheating ranges from writing compensation letters with the sole purpose of exploiting service recovery policies and cheating on service guarantees, to in? ating or faking insurance claims and â€Å"ward robing†.The Thief – Those customers who always wishes to payless or not to pay, these may be like travelling in public transport freely, or not paying restaurant bills and others – firms to be prevented from such customers use many tips because if company is not taking actions against such people; other customers would also have intentions to behave in such manners. The Rulebreaker – Those customers who don’t obey rules of company or country like breaking traf fic rules – even though it costs them sometimes a lot but they do because they feel pleasure in behaving such manners†¦.Company should ensure that rules are to be followed. The Belligerent – Expresses resentment, use to abuse employees verbally or even physically. It causes demotivation of employees if company doesn't react upon such customers because for everyone in this world SELF RESPECT is most important thing, Guards/Security are their best solutions, Company should also guide their Front line staff to deal with such uncertain circumstances†¦ The Family Feuders – Customers who gets in detailed arguments with other customers about company of any kind.The Vandal – Those customers who always makes hurdle for company like pouring water in ATM, writing on walls, in cybercafes deleting windows files or other software. The Deadbeat – These are not like thief but close to them, these are those who pays the amount but after creating such prob lems for company, like I’ll pay tomorrow, they know that they have to pay but they try to delay as much as they can. Encouraging customer feedback provides an important means of increasing customer satisfaction and retention.It is an opportunity to get into the hearts and minds of the customer. In all but the worst instances, complaining customers are indicating that they want to continue their relationship with the firm, but they are also indicating that all is not well and that they expect the company to make things right. Here, service firms need to develop effective strategies to recover from service failures so they can maintain customer goodwill. That is vital for the long-term success of the company.Having professional and generous service recovery systems does not mean â€Å"the customer is always right† and that the ? rm is open to customer abuse. Rather, it is important for the bene? t of all too effectively deal with jaycustomers. (1782 words) References www . google. com www. wikipidea. org http://deni9ek. blogstudent. mb. ipb. ac. id/files/2011/12/CHAPTER-13-CASE-3. pdf http://www. scribd. com/doc/51888732/Services-Marketing-Lovelock-Wirtz-Chaterjee-Ch-13