Using examples of your choice critically examine how ideas about the Essay

Using examples of your choice critically examine how ideas about the nation or national identity have become an important part of contemporary culture and socie - Essay Example Britons constructed their identity in opposition to an â€Å"other†: Catholic France. Gender roles were central to this moderate Protestant national identity. By looking at eighteenth-century British writers such as Sir Walter Scott and by analyzing William Hogarths prints, it was clear how British identity was constructed as strong and â€Å"masculine† while â€Å"others† especially the French, were described as weak and â€Å"feminine† (Taylor, 2000: 63). National Identity as a Part of Contemporary Culture and Society: The diversity, the multitudinous cultural effects and the flexible symbols of the national produce an enormous cultural resource that is a seething mass of cultural elements. Culture, according to this conception, is constantly in the process of developing, of emerging out of the dynamism of popular culture and everyday life whereby people make and remake connections between the local and the national, between the national and the global, between the everyday and the extraordinary. However well established and institutionalised nations may become, they remain elusive, perpetually open to context, to elaboration and to imaginative reconstruction (Edensor, 2002: vi). There are several routes towards expressing identity that exist within this matrix, some branches of which wither, are renewed, and multiple connections which exist between cultural spheres according to Edensor (2002: 1) emerge. Despite the globalisation of economies, cultures and social processes, the scalar model of identity is believed to be primarily anchored in national space. Partly, then, the space in which culture and everyday life operates is indisputably the nation which is a social and cultural construct. Edensor: (2002: 3) states that the position of the state towards already existing cultures is complex, for certain cultures may be eradicated (especially in the case of ethnic or

Outline the main factors explaining news definitions of gender and Essay

Outline the main factors explaining news definitions of gender and assess the evidence that journalism contributes towards the a - Essay Example Moreover, stereotypes of a litany of different origins are likely to pervade the media’s representation of any given topic; and have been proven to exist for as long as the modern media has been in existence (Munoz et al., 2012, p. 385). As a means of understanding this unique dynamic, this particular analysis will consider some of the main reasons why the current, and past media, have marginalized and alienated women and how this impact has in fact worked to compound women’s issues within the context of greater degrees of freedom and societal shift that may have otherwise occurred had the pervasive agenda of the media not been in place. In order to begin to discuss such a topic, it is necessary for the reader to come to a firm and complete understanding of what defines the media and to what extent and for what reasons it remains a dynamic and powerful force in formulating the ideas of society. In order to achieve this goal, the first section of this piece will discuss the role and evolution of the media on the lives of those within Western civilization. So powerful has been the effect of the media on the way in which the world has grown and developed that key historians and social scientists in the 19th century collectively dubbed it the â€Å"Fourth Estate†; an homage to the medieval representation of the three estates of society – the clergy, the nobility, and the commoners. As a means of defining the power that the media holds over society in such a way, the reader comes to the powerful understanding that such a high level of influence is given to this entity that it in and of itself can be counted as a determinant entity within the â€Å"estates† of modern society. Likewise, by limiting the analysis to Western civilization it will be possible to provide a level of focus upon the same media that affected the nations that comprised the early women’s liberation movement of the 1960s and onwards. One such factor that m akes the media of the recent past as well as the present unique is the surprising level of standardization and singular ownership which defines it. Whether one considers the newsprint media, television media, radio media, or media of other forms, a few solitary players control the lion’s share of these forms of media. As such, the range of diversity and the level to which archetypes have been constructed and accepted has reached endemic proportions. For purposes of analysis, the media which will be analyzed involves print, television, radio, and various other types of less popular yet still visible forms of advertising and media that impact on the lives of individuals on a daily basis. With the growth and widespread popularity of television in the years following the Second World War, media saw a sudden shift in the means by which it could interact with the average individual within the developed world (Ferguson, 2012, p. 890). Rather than relying on selling newspapers, magaz ines, journals, books etc, the media now had a cheap and effective way of allowing the advertising budgets of their sponsors to defray the cost that would otherwise be passed on to the consumer and

Environmental Challenges that Sony Faces Essay Example | Topics and Well Written Essays - 3000 words

Environmental Challenges that Sony Faces - Essay Example The present research has identified that various changes in the marketplace which particularly should always involve political, economic, social, technological, environmental and legal factors and more. Under political factor, it is always common to look at the government’s conservatism when it comes to dealing with business. One perfect example would be the case of privatization. In every government, there is always a strong stand on controlling the rise of the certain organization. In Japan, for instance, various organizations are faced with remarkable challenges because the government is trying to protect the interest of small organizations in their respective industry. However, the ability of Sony to leverage its core competencies together with other organization is a proof that there is always the right timing in politics. For instance, Sony’s intent to leverage its core competencies with a Swedish telecommunication company in order to beat Nokia resulted in the bi rth of Sony Ericsson. This joint venture is a remarkable proof that finding the right place for each organization is needed in order to enhance its core competencies. This at some point has specifically involved the prevailing political stand of a nation which basically has a great impact on the entire business process of an organization. For instance, a government saying no to privatization may significantly create an impact on those organizations planning to leverage their core competencies through it. With this, it is important to understand politics as a major thing that affects how the entire business should be conducted primarily because of the prevailing government’s stand. However, it is not only in this broad and general illustration how politics essentially affects Sony. In modern situation, politics itself could stand between competitors or even within an organization. This is a proven trend in the whole business industry of electronics. For instance, every profit organization in this industry is simply trying to be a cut above the other by reaching its competitive advantage. Competitive advantage is something that needs to be worked out because it serves as something that will enhance core competencies.

Case study for MGMT306 Example | Topics and Well Written Essays - 1000 words

For MGMT306 - Case Study Example nclude hamburgers, milkshakes, cheeseburgers, various types of desserts, chicken, different soft drinks, breakfast items, seasoned fries and French fries. One of the key problems of McDonald is the issue of cultural differences. Being a global company, McDonald focuses on recruiting competent and talented individuals who have the potential and ability of improving on their sales volume. However, the company faces such challenges of cultural differences since its employees come from different cultural backgrounds. Thus, providing an equal training for such employees on how to execute their job roles is challenging for the company. Nevertheless, the company has allocated adequate resources to ensure that it manages the issue of cultural shift effectively. In this, McDonald ensures that it hires labor that is characterized of cultural background of its business environment. Cultural differences among nations also influence how McDonald applies is strategic approaches of attaining business success. Thus, cultural values, which include eating habits, gender perspectives, communication modes, dress codes and religion, dictate how business operations have to be conducted in a given country. McDonald has realized the need of taking into consideration of the cultural values of each business location in order to overcome the issue of cultural shock. As such, the company ensures that it aligns its business strategies with cultural values and practices of the community in which it has to conduct its business activities. Inflation is factor that influences business activities of all international companies. McDonald is one of these companies, which incurs challenges of changing currency rates and inflation in some of its countries where it has established branches. Thus, the company experiences problems in management of its revenues since they shift based on the currency variation among countries. To address this, McDonald ensures that it aligns its pricing strategy with

United States public debt Essay Example for Free

United States public debt Essay The United States deficit, surplus, and debt will always have an impact on taxpayers. In the state of high deficit the government seeks ways to cut and save money for debt payment. The government does this by pulling funding from programs that have little government impact. Increasing taxes also supplies the government with extra income. In addition to the reduction or elimination of certain tax credits, the government analyzes school funding for cost effectiveness. Each step the government takes has a trickling effect on taxpayer’s dollar. The Effects of U.  S. Deficit, Surplus, and Debt When a surplus exists, the government has extra funds to spare and infuse into the economy. This surplus will increase government programs. When the government has a surplus it focuses on its needs by order of necessity, similar to the way individuals do when they have extra money. This can lead to new tax credits for taxpayers. However, when the nation is in debt the taxpayers are also in debt. The government uses tax money to finance their operations. If debt increases taxes go up, if debt decreases taxes lower for most. Effects on Future Social Securities and Medicare Taxpayers are affected by the U. S. deficit when there is a shortfall in revenue, which is the result of the National Debt increasing. Surpluses also have an effect on taxpayers as well. Programs like Social Security and Medicare receive government funding from tax money. Social Security takes contributions made by citizens to accumulate a surplus, which it uses to buy government bonds, which are government debt. These bonds accumulate and eventually mature. The money from the mature bonds helps to pay retirees. As American citizens contribute money into Social Security, the bond purchases mean that the government owes the Social Security program the value of the bonds purchases (Colander, 2010). The debt reported by the government for this purchase, however, is for on-budget accounts, while the U. S. reports unified accounts which include on-budget accounts but also adds off-budgets accounts as well. Like Social Security, Medicare relies on contributions made by citizens. However, Medicare makes use of third party payer markets, which helps people receive services who may be different from those who provide the services. Third party payer systems take contributions to help defray the cost or expense of providing the service while a portion of the services, such as Medicare, are paid by the consumer through the use of a co-payment system. The expenses incurred by instituting a program, such as Social Security, means that the costs of using this program are set against any revenues made for that same year. The cost of running Medicare and Social Security will rise as more Americans reach retirement â€Å"This will require more benefits be paid out than revenues are coming in, thus increasing the expenses and increasing the deficit† (Blahous, 2011). â€Å"The Social Security Administration figures that by the year 2040 the SS trust fund will be used up causing utilization of one of three options: borrowing, increasing revenue, or lowering benefits. The Medicare program is estimated to be much closer to crisis than the SS trust fund. In contrast to current Medicare and Social Security benefits budget of 35 percent, an increase to 60-65% may be necessary as early as 2030† (Colander, 2010). Current legislative discussions by political parties recognize the potential impact on future economic growth that this increasing deficit may have and are seeking ways to address as well as reform programs such as Medicare and Social Security. Unemployment and the Deficit Just as Social Security and Medicare are affected by the United States deficit and surplus, so is the unemployment rate. Increasing unemployment rates increase the deficit thus naturally reducing the deficit decreases unemployment rates as well. According to Ginsburg and Ayres (n. d. ), â€Å"The President and Congress try to outdo one another on who can cut the Federal budget deficit the most. But efforts to reduce the deficit at the expense of necessary social programs are unnecessary and counter-productive. In fact, much of the recent reduction in the deficit is due to the decline in unemployment† (p. 1). With record high deficits within the last years the idea of the government spending to spur the economy that ultimately would help reduce the unemployment level seems near impossible without further affecting the deficit rather than helping reduce it. University of Phoenix Students When students default on their loans, it adds to the national debt. The main problem lies in the fact that newly graduated students can’t find jobs that pay enough to reduce their debt â€Å"Tarah Toney worked two full-time jobs to put herself through college, at McMurry University in Abilene, Texas, and still has $75,000 in debt. She graduated in six years with a Bachelor’s in English and wanted to go on to teach high school† (Jaffe, 2011). Yet the government still requires the students to make on time payments. A surplus allows the government to use more money for grants and loans. The extra money from the budget goes into programs like the Pell grant. This enables more students to borrow or receive money to attend college. A deficit of funds affects students the same way student debt affects the government. To combat debt, cuts to government funding will take place. When the government cuts education funding, programs that fund grants lose money. The United States International Financial Reputation In addition to domestic ramifications regarding the United States deficit, surplus, and debt, international standing can waver due to a weak economy. These topics play an immense part in formulating this nation’s global standing. Maintaining its reputation as a world superpower is arduous during economic crisis. The deficit consists of the dissimilarly in government’s income and its disbursement. Other countries closely watch the deficit/surplus gap. America reputation rest whether it is positive or negative on the amount of the deficit. When the nation spending exceeds the amount it receives, America’s economy seems to be at risk. A surplus in funds strikes a balance to the United States receiving more money than it spends. Hall (2012) states, â€Å"†¦surpluses and deficits result from policy choices about government spending and taxes† (para. 6). If a surplus transpire because of the government not administering funds toward the policies that can help the United States run more efficiently, this can shed a negative light on its globe’s personal image. A Domestic Automotive Manufacturing (Exporter) As an exporter of domestic automobiles, the nation’s deficit, surplus, and debt can impose the prospering or nonsuccess of exporting. An economic strain on funds seeps down and effects American businesses. America prospers from its export and import business. Exporters in the automotive manufacturing lament when the nation’s deficit/debt is high. When America economy is failing, it experiences a lofty volume of automotive imports. American automotive manufacturers languish during economic decline. The automobile industry as a whole continues to be depressed as a result of the global economic depression† (Thompson Merchant, 2010, p. 12). Despite America’s economic problems Japanese manufacturers appear to thrive. Thompson and Merchant (2010) state, â€Å"†¦foreign automakers Toyota and Honda continued to achieve record high revenue levels through 2008 as they increased their market share in the United States† (pg. 12). During a surplus, automotive exports escalate for American manufacturers. A surplus in funds results in the nation’s ability to pay its impounding debt. Lowering debt equals lower interest rates. A surplus makes it easier for manufacturers to safeguard loans to export automotive parts. U. S. Deficit Effect on International Import The economies deficits, surpluses, and debt have an influence on both an Italian clothing design importer and GDP. For example, America can import clothing from an Italian clothing company. If the country has a financial deficit, they must reduce importation and focus on local product. This hurts international trade. A government surplus allows the country to purchase an increased amount of foreign goods. Surpluses, deficits, and debts also affect the nations GDP. As imports increase and deficits and debts increase, the GPD in the nation will decrease as less domestic goods are being sold in the country. When exports increase and a surplus occurs than GDP will increase as well as when there are more domestic products being sold in and out of the nation. Gross domestic product is the amount of products made in the country and sold. These can be both domestic products made and sold here along with exports made and sold elsewhere.

Impact of Culture on International Business

Impact of Culture on International Business Doing business on the international plane presents many challenges because of a variety of factors which differ from one market to the other. These differences are basically informed by the environment of the host country, which is often times different from that at home. One of the environmental factors that present such a challenge is culture. Culture can be defined as complex construct that embodies a peoples knowledge, morals, art, beliefs, customs, laws and other capabilities gathered by a community over time (Clifton, 2004). The culture of the host country strongly impacts on the performance of a firm that engages in international business. Notable aspects of culture central to the conduct of international business include the social structure, religion, language and education. G4S, a company that has established itself in international business has had its fair share of challenges in this area. Social structure has to do with how society is socially organized. It could be looked at from the individual-group dimension, or from the social stratification dimension. Some societies consider an individual the pillar of social organization (Emerson, 2007). This is the scenario G4S encountered when it entered the American and most Western markets. The challenge here was how to instill a sense of teamwork among employees. It was an uphill task for managers who had been socialized to believe in the superiority of teamwork, as individuals compete against each other for results. On the Japanese market however, the firm found that emphasis was on group, rather than individual performance. Though this is said to be the driving force behind the companys success in Japan, it is vilified for imbedding creativity, and is touted as a stumbling block to dynamism. This, indeed, is a challenge the firm has had to deal with. Social stratification has to do with placing members of society in certain classes. There are those in the lower, middle and upper classes. Many times, this is borne out of ones family background, income or occupation. Those from the lower class only hope to move from that class to the upper one through a process called social mobility, which is in most cases done through education and job opportunities. When opportunities for mobility are suffocated, there is likely to be conflict between the classes; and in the job situation, between management and employees. Some societies have room for social mobility, while others do not. A country like Britain has less social mobility (Hill Jain, 2008, p. 66, 67). As a result, there is always simmering tension between management and workers, which the firm has had to deal with from time to time. When industrial disputes become frequent, the firm finds doing business in the country quite expensive. Such a problem is not common in America, where social mobility is easy. G4S operates in countries with various religious persuasions, which have an effect on its operations. In predominantly Christian (protestant) countries such as Britain, America and most of Africa, the spirit of entrepreneurship has helped expand the companys operations and profitability. Protestantism advocates for hard work and creation of wealth for Gods glory, but abstinence from worldly pleasures. Since the resources earned from working cannot be spend on leisurely pursuits, the only other option is to reinvest it in expanding the business (Hill Jain, 2008, p. 70). The Christian ethic, which is a cultural issue, is supportive of the entrepreneurial (capitalist) mindset. Doing business in Islamic countries such as Saudi Arabia is rather tricky. In the first place, the Islamic culture frowns upon charging interest on loan. Doing business in such an environment has been very expensive. The fact that adherents of Islam do not work on Fridays goes against the practice in other countr ies, and managers found it difficult making adjustments. The Islamic culture also favors market based systems and when they suspect one is making exorbitant profits, however justified, the establishment begins putting sanctions in the companys ways. This has hindered the company from making maximum profits from its investment, which is the hallmark of the capitalist culture from where the company originates. There have also been problems of negative perception of the company because of the historical West-Islamic conflict, making the firms operations difficult. When tensions between the two sides run high, sometimes the companys property is destroyed, or its products and services shunned by customers. This reduces the companys profitability. Operations in China where Confucianism advocates for individual connections rather than the rule of law have also been problematic. Business ethics have not been adhered to, making the firm lose out on opportunities for lack of connections, refe rred to as Guanxi (Goodrich, 2005). G4S once lost case where a company that had breached a contract was left unpunished because one the companys top executives was a son to a leading politician. Though this would appear to be unethical in most Western countries, it is perfectly normal in China, as the company later came to learn. For the sake of survival, G4S has now been forced to recruit well-connected local executives, and to enter partnerships with local companys belonging to senior government officials. This is normal in order in China. Most of the countries in which G4S operates have diverse linguistic backgrounds. This has posed major problems, especially in Saudi Arabia, where most people speak Arabic. Expatriate managers without the knowledge of Arabic have found it very hard to communicate when marketing the companys products and services. This has forced them to attend Arabic classes so as to make them perform better. Most African countries with a multiplicity of languages also pose problems of multiple cultures, which call for extensive training on the part of managers for these regions. Formal education determines the quality of skill, values, norms and the general socialization of individuals. G4S has had problems operating in countries such as Somalia and Rwanda in Africa, which have no proper system of formal education. In most cases, the firm has had to rely on expatriates to fill top management positions. References Clifton, J. (2004). Culture and International Business. New York: Blackwell Publishers Ltd. Emerson, N. (2007). The Social Dimension of International Business. Beverly Hill: Sage Books. Goodrich, A. (2005). The Dynamics of Global Business. Chicago: Gift Book Publishers. Hill, C. W and Jain, A. K. (2008). International Business: Competing in the Global Marketplace. New Delhi. Tata McGraw-Hill Publishing Company Limited. Impact of Culture on International Business Impact of Culture on International Business In this essay I am going critically to evaluate the impact of culture on the International Business. Culture is a term which could be defined in many ways. All the people have different attitudes and perceptions so when being asked what is culture for them , the answer will always have different aspects. Despite the we all believe we have impulsive knowledge on what culture mean defining it is more complex. According to Kroeber and Kluckhohns research culture may be defined in more than 160 ways. Best culture descriptions that were found during the research are that culture is. Different aspects of culture help different people to find the best field for them. But theres a case when culture affects the whole society not only individuals. According to Francis Fukuyama the most crucial area of modern life in which culture exercises a direct influence on domestic well-being and international order is the economy. Although economic activity is inextricably linked with social and political life, there is a mistaken tendency (â‚ ¬Ã‚ ¦) to regard the economy as a facet of life with its own laws, separate from the rest of society. The comprehensive cultures impact on international business might be found in every international company as culture affects HRM , International marketing , supply chain , operations management , corporate strategies and especially way of doing business. On the other hand cultures influence may be found mainly in values , beliefs and behavior. We can simply view three cultural differences across values , beliefs and behavior (see Appendix 2) The main summary about culture we can make is that when comparing different cultures we can define 4 key assumptions. Cultures are not homogenous. Within every culture there are subcultures . For example the caste system in India, working class culture. Also place of residence. For example Basque people , French Canadian. Cultural heritage and its interpretation are very individual, so we cant assume that two people from one country will behave in similar way or to have common beliefs. Separation of cultural issues from economic and political is complex as all three factors interact to influence views and beliefs. Defining the degree of differences between cultures is not straightforward because recognition of differences is a subjective issue. As the level of international trade and travel increases cultures become increasingly associated and the cultural diffusion may alter the significance of national cultures. As we saw that culture influences beliefs , values and behavior , its likely that the culture affects also the management style. The variations of what authorizes the management are not different in black and white terms , because theres a cross-cultural understanding of the purpose of doing business and the nature of management task. However there are differences of emphasis , priority and understanding which may create a variety of styles and practice. In fact the differences can be found by separating countries in a cluster. According to Hofstedes Cultural Dimensions there are four kinds of them which are used in order to compare national cultures. Individualism versus collectivism Individual rights and freedoms are fundamental values in individualistic cultures.  Special emphasis is placed on personal career and remuneration.  Collectivistic cultures are built on a foundation of values: harmony between people in the group, the priority of group needs and interests.  Hofstede concludes that all rich countries are individualistic and poor collectivist.  In societies individualistic relationships can be planned and either party to terminate them if they replace them with a good offer from elsewhere.  In collectivist cultures are characterized by relationships of moral and emotional nature. Power Distance Each member of the organization defines different levels of owned by him and other members of the groups organizational status, prestige and level in the organizational hierarchy.  Various are the rights deriving from the hierarchical level.  Subordinates carry out the decisions of superiors in a different way.  Use categories: gender, inequality, privilege, social position, status, power, etc. podchineiie  Studies of Hofstede put Asian and South American countries together with Belgium, France, Italy and Spain in the group of countries with a high index of severity of hierarchical position.  Scandinavian countries and the U.S. have low values of this parametyr, Bulgaria is among the countries that are characterized by the greatest difference between managers and subordinates. Uncertainty avoidance There are societies in which the uncertainty of future worries people, and vice versa.  For those societies are characterized respectively high or low depending on the experts in solving problems as small or large mode of individual consciousness to deal with them.Societies that do not take the risk and fear of tomorrow, develop pluralism of opinions and are willing to deal with individual problems.  In other societies, people are fighting for the future, they are nervous and aggressive.  They feel threatened by the world around them because they avoid the risk.  Hence the characteristics of the crop in their respective organizations: subordinates seek clear instructions and managers, preferring more rules and laws.  Bulgaria is among the countries in which people feel moderately stressed, are more conservative beliefs and value safety. Masculinity v femininity G. Hofstede defines masculinity as the extent to which dominant values in society are considered aggressive, pursuing the goals by all means.  The orientation is towards money and possession of property.  Cultures with a feminine nature, appreciate the relationship between people, caring for others, overall quality of life.   Dimension masculinity femininity is important to determine the methods of reasoning in the job, the choice of approaches to solving nl most complex tasks of conflict resolution.In Table.  5.5.  reflected the consequences for organizations of prevailing masculinity or femininity in the national culture (adapt. 3, 5, 12, 15 and 18). Depending on national cultures are formed organizational value systems and behavior.  Large transnational corporations are constantly confronted with the problem of national cultures, assessed the compatibility of cultures, predict the development of their interaction and assign them (incorporate).   So for every businessperson that is going to deal for a first time with a specific country can easily to look at the clusters (see Appendix 3 , fig 1) and to get an idea whit what kind of culture hes facing and how to deal. These clusters show that theres a level of cultural attraction between groups of nations so its easier to make a general understanding of management practice. But there are danger s of making groupings of countries. The detail of how people behave in certain situations must be discovered by own experience and discussions with people who have already worked with the particular country. Although having an understanding of a nations characteristics at a good level is very useful in international business because in different parts of the world theres a different management styles and because each of the main business factors are affected by the culture and cultural differences. When a company is creating its international strategy , it should consider where and what is going to sell , also to evaluate if the product will be accepted , because the future of the products success depends on the cultural understanding of the people who are going to buy it. For example for a company selling pork meat will be impossible to sell in Islamic countries because of the religion restrictions. Also staff should be employed in a variety of adequacy in the foreign locations. So human resource management need to be sensitive to any cultural need that might to individual countries. Similarly if a company wants to establish overseas plants , the culture and cultural difference can easily affect the way of production and content and format of any financial reports produced to report the firms performance. Its important to look how culture affects the operations management , international marketing , human resource management and finance functions. Impact of culture on International Marketing Its clear that the cultural differences across the world offers not only challenges but also opportunities for the international marketing. When being on a business trip its interesting to face products and facts that might be regarded as strange . For example advertisements of well-known brands completely different than those ones at home , or even opening hours for shops. All of those simple facts are of a great importance for marketing managers and pose potential threats for them when developing a strategy. When a company which is going to expand overseas is developing its strategy there are four alternatives for it: selling the product without changes on international markets. modifying products for different countries or regions. developing new products for foreign markets. incorporating all differences in a single product and introducing a global product Having categorized cultural groupings and cultural characteristics , managers are able to seek new overseas markets to expand their firms , to sell more goods , and to raise profits. Even culture might be suggested as a tool for marketing segmentation because if the culture in the target country is similar to the culture in the existing markets , its a precondition that selling the product in the target country might be successful. Products sold on foreign markets are influenced by the local behavior, tastes, attitudes and traditions in each market. The Coca Cola Companys attempt to sell Diet  Coke product on the Japanese market was not successful because the Japanese do not  consider themselves overweight and Japanese women do not want to admit they are  dieters turning to products whose label specifies that. The company was forced to  change the product name in Coke Light, and the promotion emphasized keeping in  shape by consuming the product, and not losing weight. Goods intended for consumers are more likely to suffer changes because they need to be adopted to meet the customers expectation in the target market and to meet the economic conditions of it. There are many examples of international firms that adjust their products to meet the specific expectations of the overseas markets. For example, McDonalds was forced to remove their menus including pork and beef meat and to create menus especially for the Indian market. The company has also developed rice-based  menus in China, started selling beer in Germany, wine in France, and in Japan  the character Ronald McDonald was called Donald McDonald to be easier to  pronounce by the Japanese. Another cultural issue that is effecting the international business is the price because it needs to match exactly the level of economic development in the target country. McDonalds is an exact example of that. When McDonalds opened in India , the company wasnt forced only to remove the beef and pork menus but also to reduce the prices of all goods which were sold in the restaurants. But still despite the fall in prices recent statistics show that McDonalds in India raised their profits by 8,9%. Human Resource Management In every company the HRM Manager is in charge to care for recruiting and training staff , working methods and time. For every company dealing across the world , its very likely to have staff of mixed nationalities which could lead to cultural confounding. When recruiting staff , some cultures will apply more conducted approach. For example the approach will be based on accurate qualification for the job and also test in order to asses the potential ability of the candidates. Other cultures will act differently by applying more easygoing approach. For example this approach is based on education, personal recommendation or employer networks. A main concept that is also relevant to the HRM is Hofstedes concept of power distance. Its relevant because its related to mans attitudes to hierarchy and also the way in which this might be translated into different ranges of pay levels of the highest and the lowest in the company. For example in France which Hofstede defined in the Power Distance group , theres a great gap between lowest and highest paid employee while in contrast the more collectivist and low power distance countries the gap is much smaller. Finance In order a company to pursue its goals and objectives it must be ensured with sufficient funds. Also need to be monitored if funds are used efficiently and correctly , if financial performance is reported to then management and shareholders. These are the main functions of the finance within every business. But elements mainly influenced by culture are sources of finance and reporting practice. Sources that might be used for companies expanding vary between different countries , as sources reflect not only on the political economy of the countries but also on their state of economic and financial development. For example in countries as japan and Germany usual form of sourcing business is by having loan from a bank while in the USA and UK businesses rely more on raising money by selling equity shares on the stock market. In order to expand overseas , companies may choose to find the money from the host or home country or even from third country. For example, when McDonalds decided to open their first restaurant in Moscow in 1990 during the Soviet Union. The company has used a joint venture with the Moscow City Council. Despite all the funds came from the franchisor from Canada and the US headquarters , the deal was to pay to the City Council in order to be allowed to operate in Moscow. So the agreement reflected the Soviet/Russian political system where business and state a re closely connected. So its fair to say that the financial arrangements were partially influenced by culture. Similarly there isnt an unified approach for reporting financial results by annual reports. For example nations as Germany , Italy and France use continental approach and is heavily influenced by tax regulations. The reports information is designed to allow the tax authorities and government to compute and monitor the liability. While Australia , USA and UK use Anglo-Saxon approach. Its assumed that the shareholders are the main users and the information provided in the report allows them to asses the companys performance and their investments performance. These differences are of a great importance for international companies because when they enter the international market and build their branches they will be challenged to agree to the local terms and rules. Also the financial information from all the branches should be combined in addition to create consolidated accounts. Common practice for international companies is to create unified reporting system based on home countrys rules and terms. So then the international branches use this system in order to prepare their financial reports. After reports are finished then the local staff in the international branches reworks the reports in order to meet the local regulations. Appendix 1 shared patterns of behavior (Mead) ; Collective mental programming (Hofstede); A set of base assumptions shared solution to universal problemsâ‚ ¬Ã‚ ¦ handed down from one generation to the next ( Schein) ; The essential core of culture consists of traditional ideas and especially their attached values (Krober and Kluckhohn)

Cost Volume Profit (CVP) Analysis Applications

Cost Volume Profit (CVP) Analysis Applications 1. Introduction The use of Cost Volume Profit (CVP) Analysis depends upon a number of clear assumptions, for its application in resolving problems, simplifying complexities and aiding decision-making in business issues. Areas of application, inter alia, include pricing, calculating contribution, computing costs, deciding sales mixes, estimating breakeven points, assessing profitability, and achieving profits. As a financial tool in the hands of accountants, (professionals who are generally more at home in dealing with simple and linear arithmetic than with the intricacies of statistics and calculus), it is invaluable, brilliant in its simplicity and in its ability for using straightforward calculations to make sense out of complicated business situations. CVP analyses work on certain basic assumptions in areas of sales, in unit price and volume, and costs, fixed and variable, for their simplest and most straightforward applications. However, the irregularities of actual business situations, their proneness to pick up complex variables, and their stubborn refusal to abide by the norms of arithmetical linearity, introduce a number of issues that sometimes make it difficult to apply simple arithmetical concepts like CVP towards their resolution. The simplicity of an analytical tool such as CVP can cut both ways. It can be both its greatest virtue and its major shortcoming. The real world is complicated, no less so in the world of managerial affairs; and a typical analytical model will remove many of those complications in order to preserve a sharp focus. That sharpening is usually achieved in two basic ways: simplifying assumptions are made about the basic nature of the model and restrictions are imposed on the scope of the model. (Guidry, Horrigan Craycraft, 1998) Businesses that do not have a single product sales portfolio, and who, in the normal course of their activities, sell a number of products, sometimes quite dissimilar from each other, face even more difficult and complex challenges in the application of CVP concepts. It is the purpose of this assignment to examine the appropriateness of applying CPV techniques in business environments, wherein companies produce and sell a number of dissimilar products, with particular reference to the specific assumptions needed for such exercises. 2. Commentary In base terms, a CVP analysis deals with sales, costs, contribution and ultimate profitability. Arithmetical manipulation of the relation between unit sale price, total sales, variable costs, contribution, fixed costs and profitability, results in information about breakeven volumes, the implications of both variable and fixed costs on margins and final profitability, thus helping decision making in such issues. a. Sales The first set of assumptions, in this methodology, concerns financial data regarding sales. CVP techniques work on the assumption that product sale prices will remain constant and total sales will necessarily be a linear multiple of the number of units sold. As such, if ‘x’ is the sales price in GBP and ‘a’ the volume in units, total sales will equal ax GBP. In most business situations, factors like volume and cash discounts, as well as introductory offers to new customers, often cause changes in sales prices. It is general practice for accountants, in such situations, to arrive at an average sales price depending upon the business environment, and the needs of the market, and apply it for CVP exercises. This situation could become complicated, if sales prices differ in different geographical areas, and infinitely more complex for analysis, if a company deals with a number of products, each of which may have a range of items, and different pricing policies. Furthermore, the use of average prices becomes patently unsuitable, if not downright silly, in environments where a number of diverse products make up the sales basket. b. Variable Costs Costs, for CVP analyses, consist of two broad categories, variable costs and fixed costs. Variable costs are costs that change directly in proportion to changes in volume. They include the wages of production workers or salespeople, raw materials, electric power to run machines, and the cost of maintaining inventory. While most variable costs are of a direct nature, their movement, in actuality, is never strictly linear and they tend to change somewhat, decreasing with initial volume increases, remaining stable for a substantial period and then inching upwards, after volumes exceed a certain limit. While accountants are aware that costs are never fully variable or fully fixed, this differentiation helps in some exercises, notably CVP applications. Costing and production departments thus try to segregate variable costs to the best of their knowledge and ability. â€Å"Splitting out fixed and variable costs can be a long, time consuming process; and techniques such as the inspection of accounts method really are not suitable if the analysis is to be realistic. At the very least, some kind of statistical or mathematical analysis will have to be undertaken.†(Williamson, 2000) The impact of different sales prices, and variable costs, of different items, for a company that deals in many diverse products, introduces a host of complexities in the use of CVP techniques, which primarily work on the assumptions of single product lines, constant sales prices, variable costs, and linear movements of both, in accordance with volumes. Fixed Costs, another important factor for CVPA exercises, comprise of expenses that do not change in proportion to the level of activity of a business. They can include both overheads, like rent and utilities, as well as direct costs like salaries. It also needs understanding that fixed costs remain steady only within a certain range of activity, and for a definite period. They are quite liable to change with time and with level of activity. c. Multi product Situations CVP exercises make use of all these components, namely sales prices, sales volume, variable costs and fixed costs to arrive at conclusions regarding contribution margins, breakeven points, pricing decisions, minimum volumes that need selling, and similar other financial issues. While CVP analyses progress on the assumption that primary factors will behave predictably, at least for single product companies, the situation in real life business environments is very different and sales prices, variable costs and fixed costs get impacted by developments like changes in pricing policies, needs for special discounts, inflation, and mid term salary increases. All organizations are subject to uncertainties, leading to risks of failing to meet expectations. Even though each organization is subject to distinctive business risks, all of them face uncertainties related to the economic environment. These uncertainties increase manifold in the case of organisations that deal in various diverse products, with differing sales prices and variable costs. Even the treatment of fixed costs becomes complex because some fixed costs would be applicable to specific product lines, (e.g. departmental salaries or rent) while others would be applicable to all product groups like the MD’s remuneration or legal retainer fees. Such business settings lead to violation of basic assumptions needed for CVP exercises. Moreover, this sort of nonlinear behaviour, of both revenues and costs, and the increasing number of uncertainties could affect the assumptions required for CVP analyses and lead to invalid conclusions. In addition, it could be difficult to determine the point of operating activity where operations move into a new relevant range. Any simple and straightforward attempt at resolving CVP issues, even for a company with just ten product lines, each with different revenue and cost cha racteristics could thus fail without the use of mathematical modelling, which at times could become quite unwieldy. Multi product situations, which automatically lead to the emergence of numerous variables and to the violation of the tenets of CVP methods, are inevitable in real life business situations, and it would thus be quite impossible to find problems that satisfy all CVP assumptions. Does this imply that the CVP method is just a simplistic arithmetical tool that is adequate for use in costing textbooks, as well as for simplifying basic cost issues for beginners, but actually of no use in real life situations where (a) the sales baskets of companies always have many products, and (b) costs are not amenable to straitjacketed behaviour? Notwithstanding the meagre probability of the assumptions required for CVP exercises occurring in real life situations, CVP analyses still maintain their relevance in operational and financial decision making, even in multi product situations, albeit with some provisos and modifications. The most widespread application of CVO, in multi product situations happens in the formulation and determination of sales mix. In such situations where there are, for example, five products with differing unit sales prices and variable costs, it is possible to find the contribution of each product per piece, by subtracting the variable cost from the sales price. An analysis of comparative contributions thus provides information about the potential profitability of the different products, and determination of the product mix that will contribute most towards the profitability of the company. The use of a practical example will be of use in illustrating these statements Data relating to hypothetical Company ABC Product A B C D E Sales Price GBP 5 6 8 11 12 Sales Volumes Nos. 100 250 325 25 200 Product Mix % 11 28 36 3 22 Variable Costs GBP 3 2 4 5 7 Contribution GBP 2 4 4 6 5 Total Contribution GBP 200 1000 1300 150 1000 The use of simple CVP analyses makes it possible to come to the following conclusions. Product E, even though it has the highest Sales Price does not give the highest contribution, either per piece or in totality. Product D, even if it has the highest contribution per piece gives the lowest total contribution Product C, which has a medium contribution of 4 GBP provides the highest total contribution to the company Profit optimising activities should primarily focus on (a) increasing the contribution of Product A and (b) increasing the sales of Product E and D. Apart from these conclusions, CVP techniques will be useful in calculating the breakeven point of the company’s current operations, after ascertainment of fixed costs, and by using the weighted average of contributions of the total products, based on the current product mix. In this particular case the weighted average of the contribution of the company’s products, obtained by dividing the total contribution of 3650 GBP by total sales of 900 units works, out to 4.05 GBP per piece. Thus, if the fixed costs of the company are 4500 GBP per year, the company will have to sell (4500/4.05) 1112 units to break even, considering maintenance of the current product mix. Income tax does not come into play until achievement of break-even levels. However, once breakeven levels are crossed, the profit after tax at various levels of sales is easily obtainable by multiplying the sales numbers, in excess of the BEP, with the weighted contribution per unit and obtaining the product of this figure and the post tax percentage. If, for example the company plans to sell 2000 products during a year, and the level of tax is 30 %, the total after tax profits can be worked out by multiplying 882 (2000 – 1112) with 4.05 and then again with 70% (being the post tax income). As such, 882 * 4.05 * 70 %, which equals to 2500 GBP will be the post tax profits at a sale level of 2000 units with the same product mix, sales prices, variable and fixed costs. The use of Excel sheets becomes very useful for such exercises and enables accountants to work upon a number of options with varying products mixes, changes in sales prices and the impact of different factors on variable and fixed costs. It thus becomes possible to forecast a number of situations and engage in a number of sensitivity exercises. 3. Conclusion The use of CVP analysis depends upon a number of assumptions in areas of sales and costs for its proper application. Many of these assumptions get violated in actual business situations, more so when a company deals in a number of products with different price and cost structures. While these factors do lead to difficulties in using CVP techniques, the availability of spreadsheets, particularly the options available with Microsoft Excel make it possible for accountants to use these techniques in different business scenarios with changes in assumptions without great difficulty or tedious and repetitive calculations. In case of situations where the number of variables becomes extensive, the use of probabilistic models helps in CVP analysis. However, the use of probabilistic techniques in normal business situations is quite rare, and the careful and knowledgeable use of CVP techniques, with the aid of spreadsheets, proves adequate in handling many multi product requirements. CPV analysi s also faces criticism because conclusions and recommended decisions, arising out of its use, disregards wealth and risk implications. Nevertheless, its continuous use and adaptability reinforces the robustness of the model and its adaptability to changing business needs. Word Count: 2128 words Bibliography Bhimani, A. (Ed.).,2003, Management Accounting in the Digital Economy. Oxford: Oxford University Press. Guidry, F., Horrigan, J. O., Craycraft, C., 1998, CVP Analysis: A New Look. Journal of Managerial Issues, 10(1), 74+. Heymann, H. G., Bloom, R. ,1990, Opportunity Cost in Finance and Accounting. Westport, CT: Quorum Books. Lawrence, C. M., 2006, Cost Management: A Strategic Focus, 3d Ed. Issues in Accounting Education, 21(3), 324+. Mascha, M. F., 2002, Cost Management: Strategies for Business Decisions. Issues in Accounting Education, 17(4), 451+. Riahi-Belkaoui, A.,1992, The New Foundations of Management Accounting. New York: Quorum Books. Williamson, D, 2000, Cost Volume Profit Analysis: Its Assumptions and Their Pitfalls, Fortune City, Retrieved March9, 2007 from business.fortunecity.com/discount/29/cvpassweb.html