Political Analysis on China Essay

China has been under the communist party rule for many decades. The communist party exercises absolute power over legislations and economic and cultural institutions. China rules and regulations are not so transparent or absolute. Due to lack of transparency and corruption the social network with the people from the communist party can help the business avoid red tape and bureaucracy. A political risk refers to government interference in the business affairs of foreign persons or companies doing business in a particular country.China is particularly hazardous with respect to political risk. In fact this has occurred in china in 1949. There are the risk of confiscation, risk of expropriation, and risk of contract repudiation.A unique form of political risk occurs in china, and this is the constant battle between the country’s central government and the provincial and local governments over applicable law, and observance or non-observance of it. This makes it difficult for companies operating in China to know exactly what the rules are. Other Political risk of China are as follows- 1) Political Effectiveness- Political effectiveness is actually not very effective in china as compared to other countries. Barely anyone bothers to call the police and they be easily bribed. Road laws are not enforced and thus there is a high rate of accidents in China with the way they drive. The government is even less confident than outside observers regarding their nation’s political stability. 2) Institutional Stability- Corruption still plays a huge role in China. They believe that profit comes first and mostly for personal reasons. At first it was only the Chinese Communist Party who took control in 1949. Later the other branches such as the Judicial Branch came into power in 1980. 3)Currency inconvertibility – The import and export business exchange currencies in either USD or RMB. Only certain worldwide currencies can be exchanged in China, other than that they use the RMB. 4) Honest Government- There are many cases known to justify corruption among government officials. Policies and laws are not solid or stable in China, therefore everything is negotiable. The CPI ratings of China are 3.5 this year. This looks bad compared to the United States and Canada. 106,000 officials were prosecuted for corruption in 2009 which was a 2.5% increase from 2008. With China’s growing economy, it will only get worse. Minimizing Political Risk- For minimizing political risk we should understand the importance of social networks and their relationship. It is a challenging process for a company to recruit the right people with the appropriate network to overcome these challenges. Legal System- For thousands of years, the Chinese legal system was based on Confucian ideology that emphasized ethics and relationships between the people and their leaders. China does not technically have an independent judiciary or a legal system that operates outside the influence of the ruling Chinese Communist Party. In fact, China’s lack of an independent judicial system. Legal and Regulatory Risk Regulatory risk in China is high. Although many sectors of China’s economy have become more market oriented, numerous restrictions and a massive bureaucracy still hinder full implementation of regulations and make the approval process unpredictable. China’s Judicial System- Using China’s judicial system also involves risk. Because of China’s WTO membership and growing pressure from foreign investors for greater transparency and rule of law, China increasingly recognizes overseas arbitration awards and rulings. It is, however, still risky for companies to rely solely on the PRC judicial system to protect their interests. Similarly, China’s accession to the WTO has brought with it the inclusion of international business laws and patent rights amendments, but even today it is common to see technology being stolen either by the employees of the outsourced firm in China or by a Chinese competitor in the country. Protection from foreign Currency Earning Enterprises- The cost of doing business in China is frequently higher than companies expect. These issues, coupled with a recent rise in policies aimed at protecting domestic companies from foreign competition— especially in engineering and construction, legal services, and banking—create risks and obstacles that few foreign companies are aware of until too late. Minimizing Legal Risk- Hence western companies that plan to outsource manufacturing to China should be aware of these legal challenges. One way of preventing these issues is to have a strong network with the locals or to make sure that sensitive technology is not outsourced to China. Cultural Challenges China has evidenced thousands of years of history, culture and traditions. The way Chinese people behave today is the result of its historical transformations, which is very different from the transformations witnessed by western societies. Hence the modern day Chinese culture is very different from the cultures of the west. The cultural aspects of the Chinese are immensely reflected in the business world, for example, A CEO in the western world is normally looked upon as a consensus builder or as an individual who debates and discusses strategies with their employees and then executes the strategy, whereas in China the leader is looked upon as the sole decider and executor of strategies. There is a strict hierarchy in the Chinese business culture, which is very different from the business culture of some of the west countries. So to run a successful wholly owned outsourcing unit in China, the western businessmen need to understand and overcome these cultural chal lenges. Challenges in Scale and Demographics China is a vast country with a massive population, Western businesses are often at awe about China and think that the 1.3 billion people could become a large customer base, but in reality China is a complex market. 850 million people in China live in the impoverished countryside; their life is harsh, uncertain and poor.536 million people live in the urban areas out of which 247 million people are considered middle class and have an expendable income. The middle class earns over $5000 per head over the period of a year, but one must also consider the fact that the Chinese are the largest savers in the world unlike some western countries such as the US where the consumers have massive spending power and a culture that promotes spending. Hence for a western company to succeed they need to understand these Demographic differences. Challenges related to market behaviour The Chinese market is unique in many aspects, many western companies have tried to sell their product as-is in the Chinese market and failed miserably, and these are not some small unknown brands but large mega brands that have been successful for many decades and different markets. To be recognized as a brand in China, one need to market and advertise the Chinese way, marketing and branding in China should carry a strong Chinese Cultural overtone to be successful in the mainland. Successful western companies such as Google and eBay have failed to become market leaders in China. The lesson learnt from the failure of these companies is that they â€Å"did not understand the localization factor† Therefore for the long run, western companies should â€Å"Think Chinese but act western† and sell the right product at the right price to be successful in the Chinese market. Economic instability & Trade policy Challenges China is the world’s second largest economy and is among the fastest growing economies of the world. When western companies move to China they have to consider the economic stability of the country and prepare themselves for the various risks due to changes in fiscal policy, monetary policy, trade policy and other macro economic factors. China’s economy is mostly dependent on exports from the manufacturing industry and foreign economists suggest that the Yuan is undervalued by as much as 40%. Hence a Change in the Yuan can impact the profitability of the western business. Due to high economic growth there has been a strong demand for semi and highly skilled labour all over China. The labour costs have steadily increased over the last 5 years and the government has increased the minimum wage level. This will impact operating costs in China and hence a western company planning to operate in China will have to factor in this r isk. In summary western enterprises need to be aware of macroeconomic risks before they start their operations in China or face the possibility of failure.

Chem-Med Company Essay

Problem Statement: Chem-Med Company is positioned strongly in its industry to achieve high growth and earn large profits in the future, but it is in need of financing. To secure this financing, Chem-Med must address concerns of potential financers and investors regarding liquidity, efficiency, cash flow, and the need for funding despite apparent growth. In addition, Chem-Med’s primary competitor, Pharmacia, is out-competing the company and stealing valuable market share and sales volume with lower prices. Analysis: To understand Chem-Med’s problems, we must first look at the company’s liquidity and efficiency through the calculation of various ratios. Common measures of liquidity, activity, and profitability for ChemMed and its competitor Pharmacia can be found in the following table: Chem-Med Pharmacia 2.9 2.8 1.08 5.8 30.15% 7.00% 13.67% 55.00% 29.66% 29.56% 0.8493 1.9 Current Ratio Inventory Turnover Net Profit Margin Debt-to-Assets Return on Equity Total Asset Turnover Chem-Med is competitive with Pharmacia in terms of Current Ratio and Return on Equity. But Chem-Med turns over inventory much slower than Pharmacia, at 1.08 times per year versus Pharmacia’s 5.8 times. Chem-Med also utilizes assets more poorly, generating sales equal to only .8493 times total assets compared to Pharmacia’s 1.9 times. It is interesting to note that Chem-Med has a much higher profit margin than Pharmacia while maintaining virtually the same Return on Equity. To understand this phenomenon, we must deconstruct each firm’s Return on Equity (ROE) using the DuPont Method. ROE Chem-Med Pharmacia We can see that Pharmacia makes up for its lower profit margin with a much higher total asset turnover as well as a better use of debt to achieve a return on equity similar to that of Chem-Med. While ChemMed operates with a much higher profit margin than Pharmacia, its utilization of assets and debt falls far below the standards of its competitor, causing the firm problems. Chem-Med has a three-year plan for the future. This business plan comes complete with financial projections that the bank has used to determine whether or not Chem-Med 2008 2009 2010 is a safe loan risk. The bank has agreed to make a loan to the firm on the condition that it upholds several loan covenants,  Current Ratio (> 2.25) 2.72 2.39 1.98 Debt/Assets (< 30%) 13.51% 14.03% 13.87% expressed in the table at left. The problem statistic (a current ratio of 1.98 in 2010) is highlighted. This figure is below the mandated current ratio of 2.25. Chem-Med must address this projected liquidity problem to secure the necessary financing to implement its business plan. In addition to liquidity and efficiency problems, Chem-Med must address cash flow concerns. A pro-forma cash flow statement for the years 2008-2010 follows: Chem-Med’s cash flow statement provides encouraging data for potential investors. The firm expects to have positive operating cash flows over the $ 167 next three years and therefore requires little outside financing to finance the investing outflows which will sustain the firm’s growth. Chem-Med is very $ (66) profitable Projected Net Income (2008-2010) $ 101 and is 2008 2009 2010 Total effectively converting those profits into operating cash flows. In fact, $ 1,150 $ 1,274 $ 1,943 $ 4,367 the firm’s operating cash inflows exceed the projected profits for the Chem-Med Company Statement of Cash Flows Opening Cash Balance (1/1/08) Operating Cash Flows $ 6,050 Investing Cash Flows $ (6,205) Financing Cash Flows $ 89 Closing Cash Balance (12/31/10)  firm over the three year period. Chem-Med is effectively converting its profits into operating cash inflows and by doing so the firm has almost  enough operating cash to finance its investing outflows. There is only a very slight cash flow problem as investing outflows still outstrip operating inflows, but only by a slim margin. The firm also faces a problem in terms of efficiency in collection of debts. The collection periods for the firm for the years 2007 – 2010 are presented here. 2007 2008 2009 2010 As is evident, the firm’s ability to collect on Collection Period (Days) 53.24 61.15 72 80.87 its debts is actually decreasing in the future. Instead of increasing efficiency, the firm is decreasing in efficiency. Projected Growth In Net Income (2008-2010) 2008 2009 2010 10.8% 52.5% 49.4% Despite liquidity and efficiency problems, Chem-Med has a healthy cash flow and anticipates high growth. The projected year-to-year growth rates in net income for 2008-2010 are displayed in the adjacent table. As can be seen, the firm expects robust growth over the next three years and is therefore an attractive opportunity for investors. It appears, then, that the problems of liquidity and efficiency do exist and should be addressed. Chem-Med has a healthy cash flow and is only slightly deficient in operating cash flow, but because the firm is experiencing such robust growth, it is not entirely surprising that the firm has a high need for investing cash. Recommendations: Chem-Med’s most pressing problems involve its competitor, Pharmacia. Pharmacia is engaging in price wars with Chem-Med, taking a 59% market share to Chem-Med’s 25% share. Chem-Med should lower its prices in response to Pharmacia’s tactics to gain market share. Pharmacia is already operating at a much lower profit margin, so it is unlikely that the firm can cut prices as steeply as Chem-Med. Chem-Med can still maintain a healthy profit margin while gaining valuable market share and sales volume. Increasing sales volume through price cuts will increase the firm’s gross sales while having no affect on total assets. This, in t urn, will improve the company’s total asset turnover and bring it more in-line with Pharmacia’s. Increasing sales volume, however, will not necessarily improve the firm’s inventory turnover rate as both sales and inventory will increase to accommodate the increased volume. To improve upon this, Chem-Med should consider investing in an inventory control system or consider new methods of ordering (such as just-in-time ordering) to improve  its control of inventory. In addition, Chem-Med should take note that its Debt-to-Assets ratio is well below Pharmacia’s. Engaging in more debt financing will increase the firm’s financial leverage and magnify the healthy returns it expects to see in the next three years. This increased debt usage will also magnify the firm’s return-on-equity, making it an even more attractive firm for potential investors. Chem-Med should consider offering discount terms to its customers for prompt payment. Such terms will encourage customers of Chem-Med to pay sooner and therefore reduce Chem-Med’s collection period. This, in term, frees up cash flow for the firm and will increase its overall operating efficiency and can help to alleviate some liquidity problems. Collecting in a timely manner will also decrease the likelihood of default on accounts receivable as the accounts remain outstanding for shorter periods of time. To further alleviate liquidity problems, specifically that posed by the firm’s current ratio in 2010, Chem-Med should consider using more long-term debt. The firm could take out a long-term loan to settle its accounts payable. This would decrease Chem-Med’s current liabilities, which in turn would increase the firm’s current ratio. This would make the firm appear as a lower risk to bankers and investors as its ability to meet its current obligations will have improved. By lowering its prices to increase sales volume and market share, offering discounts to decrease collection periods, and refinancing its short-term debt with long-term debt, Chem-Med Company can improve its marketability to investors, gain a competitive advantage in its industry, and look forward to improved long-term performance as a more efficient and robust firm.

Applications of seven habits by Steven Covey Essay

This classic best seller for management, organisations and personal development encapsulates Steven Covey’s research on 200 years of success literature since his doctoral program. It is perhaps the most influential book for managers and organizations to learn the Seven Habits of Highly Effective People, as the title suggest. It begins with the concept that people perceive the world differently, and we form our own paradigm – how we view the world with our own unique â€Å"lens†. Covey explains that paradigms are the source of our attitudes and behaviours. Part of achieving insight involves making a â€Å"paradigm shift† which causes us to perceive things differently. Our paradigms will affect how we interact with others, which in turn will affect how they interact with us. Covey argues that any effective self-help program must begin with an â€Å"inside-out† approach, rather than looking at our problems as â€Å"being out there† (an inside-ou t approach). We must start by examining our own character, paradigms, and motives. Hence, character and principles are keys to success, effectiveness, and happiness in life. The Seven Habits of Highly Effective People points out: â€Å"Principles are guidelines for human conduct that are proven to have enduring, permanent value.† The seven habits divided into two main groups: private victory (independence) and public victory (interdependence). Habits of Independence: Habit 1: Be Proactive We must use our resourcefulness to work toward our personal goals. Everyone has both a circle of influence and a circle of concern. Worrying endlessly about things outside of our circle of influence isn’t particularly productive. Working within our circle of influence is productive. Further, the more effective we become, the more our circle of influence will expand. Habit 2: Begin with the End in Mind What do we want people to say about us at our funerals? How will we be remembered? To succeed, Cov ey suggests visualization. Every successful outcome is created twice; first one plan and second on implementation. Habit 3: Put First Things First The key to putting first things first is to understand that we have many things we can do which will have a significant, positive impact on our lives. Covey stresses that we must balance Production (P) with Productive Capability (PC). We must keep the golden eggs, but also maintain goose. Prioritization is the essence of time management. Interdependence The remaining habits in The Seven Habits of Highly Effective People are habits of interdependence. Rather than being dependent upon other people, or trying to be totally independent, we learn how to be more effective by effectively working with others. Habit 4: Think Win/Win Thinking Win/Win means seeking mutual benefit in our human interactions. To be successful in the long run, we should learn to consider other’s win factors besides our own. Habit 5: Seek First to Understand, then to be Understood Most people talk more than they listen. Until we listen actively and seek to understand others, we would not be understood. Active listening is about sensing the three modes of communications, i.e. visual, vocal and verbal. Habit 6: Synergize It means that the whole is greater than the sum of its parts. Combining the strengths of each individual yields multiple outcome beyond expectations, simply ‘1+1>2’. Habit 7: Sharpen the Saw Just as a machine will wear out quickly if not properly maintained, the same is true for our own personal productivity. We must take care of ourselves. The four dimensions are physical, mental, social/emotional and spiritual renewals. To me, the first concept on paradigm is profound. I agree that when we change our perspectives, our attitudes and behaviours will change. To achieve enrichment in life, we need to understand our own paradigm, crystalize and anchor our principles. I have adopted these principles and find peace in self-awareness, social relationship and professional communications. Covey has successfully synthesised the successful habits of leaders, crystallised and organized them into two progressive segments. In line with child development from birth through death, one indeed grows from dependence to independence in early childhoo d to adolescence. We then mature to adults, where we progress from independence to interdependence. The seven habits are indeed proven to be critical for any individual to attain private and public victories. Hence it is no surprise that whenever I business leaders within my network on which are some books they would read to enrich their management knowledge, this book is voted as the most influential book that changed their lives. I have personally adopted these habits in my personal and professional communications and testify their effectiveness. I have sharpened my strengths in strategic thinking and leadership by adopting the habits of ‘Begin with the end in mind’ and ‘Synergize’. For instance at the Polytechnic, I mooted the idea of Young GEMS(Go-the-Extra-Miles-for-Service) camp for upper secondary school students to build our prospects for future enrolment. Upon approval from management for the Young GEMS camp, I formed a program team and successfully lead it to implement the camp through skilful synergy of the individual’s competence. This book has provided comprehensive coverage on the why and how of each habit. The only gap I see is that the context are US-based. It would be better if there is an Asian version with case studies of local enterprises and leaders, for the benefit of Asian readers. For instance, unlike Americans, Asians are generally weak in questioning skills to ‘seek to understand’ others. It would be helpful if there are some recommended strategies in questioning to gain insights of other’s perspectives. Also, Asians tends to individual and less apt to working in teams, particularly in appreciating individual strengths, expressing diversified opinions openly. Asian case studies on ‘Win-win’ and ‘Synergize’ would certainly be helpful. There is no doubt that all seven habits are pivotal in today’s managers and organisations. I personally have benefited as an account manager in Hewlett-Packard Singapore Sales when I was sponsored to attend the Seven Habits of Highly Effective People one-week course. It has significantly increased my self-awareness, strategic thinking skills, time-management skills and revolutionizes my perspectives in life. I can testify that the Habits are practical prescriptions for building trustworthy and lasting relationships, hence empowering managers to be effective leaders who could develop the most conducive working environment that attracts and retains like-minded talents for the good of society.

Assignment Communication Profile

During the course of the day, I spent just as much time listening as I did talking so I guess it is 50/50. I thought before doing this chart that I did not talk much but after I look at it I spend just as much time listing as I do talking. After noticing that most of my day is silent because no one is at home I think I need to find something to do during the day. When it comes to the different types of listing such as comprehensive listening, empathetic listening, critical listening and appreciative listening I noticed I use mostly appreciative listening and empathetic listening.Because I am A stay at home mom about the only conversations I have are with my daughter and her daddy so I spend most of my time soothing them and helping them with there problems and just being there to listen to them. I think I need the most improvement in critical listening because some times I tend to loose the whole idea of the conversations I am in and find my self daydreaming and blocking people out. I think improving on critical listing will help me a lot because not only will I be listing to what people have to say I would actually be paying attrition and understand what they are talking about.I think to improve on this listing skill I will need to get out of the house more often and communicate with different types of people. Over all I think my listing and communications skills could use some work. I think most of my problem is being stuck inside the house except for one day a month when I do errands and shop for food. I think getting out and meeting new people and communicating with friend would help me out a great deal. I think with a few minor adjustment to my normal day to day life will help me in a big way.Now when I go out I will pay more attrition to my communication skills. Because who knows what people think of me when I go out and they try to speak to me and I just smile and shake my head and they can tell I am not listing to what they are saying. Now since I am pa ying more attention to the way I communicate I have practiced it with my family and they told me I was acting different because now I actually take in everything that have to say.I also communicate more with them than I use to and they say I seem like a different person. I enjoy the time I have with my family now and pay more attention to my communication skills. They said before I was like a knot on a log I was always in a daze and never really said anything back to them when they were talking. Now I am on my way to better communication skills not just in my personal life but my social life as well.

Marketing Management First Assessment Essay Example | Topics and Well Written Essays - 2000 words

Marketing Management First Assessment - Essay Example Virginia Community Capital Inc. is however unique because it is a non-profit motivated bank. The bank target mostly low income and middle income earning individuals to empower them. While at this, the bank often earn considerable amount of profit that is majorly given back to the community with regard to communal services (Savitz, 2013 p.12). This is the first pillar of the Triple Bottom Line analysis that is to be employed to analyze the overall performance of Virgin Community Capital Inc. (VCC). The bank’s greatest source is the interests it earns from the loans it advances to the community for various activities they take. VCC is approximated to have issued out loans worth a total of $419 million. Below is analysis of the financial statement that reveals the ideal position of the organization (Chhabra, D., 2010 p.13). The bank is believed to have reported an earnings ratio of about 66% in the year 2012. This is higher than the 35% registered in 2011. This implies that the expense of interest increased more than the increase of the interest earned by the bank. Deposition amount obviously was higher than the amount of loans in the year before. This depicts that at that particular juncture; the bank was working towards a negative ground and was registering a loss (Savitz, 2013 p.13). This is also portrayed by a trend analysis whereby the income interest increased as from the year before, 2011, 50%, compared to a lesser value in 2012, 17%. However, the interest from expense rose from 65% to 121% by 2012. It is prudent to note that the profit ratio is seen to have increased from 0.056 to 0.072 and is an indicator that bank is self sustainable due to the earned profit. The provision rate of loans in VCC is seen to have gone down. This depict that solvency of the bank in situations of default would be prudent since the bank is at less riskier loans in the current year. This is clear when you look at the decreasing loan loss provision ratio

Thinking Styles Essay Example | Topics and Well Written Essays - 750 words - 1

Thinking Styles - Essay Example Critical thinking dispositions are manifest in certain processes: understanding, analytical and reasoning processes. â€Å"Critical reasoning, as defined in plus definition set, is always rational because it uses reasons one way or another. However, although rational, it is not necessarily sound. Critical reasoning can be sound or unsound† (Critical Thinking, n.d.). These characteristics can be developed through management practices that foster analysis of the elements of reasoning. As a cognitive process, critical thinking may be defined as a self-reflective grasping of the structures of thought and subjecting them to (rational, reasonable, logical) standards that facilitate the perception and correction of errors in thinking (Schafersman 1991). In some cases, the role of the leader is to facilitate managers’ learning not what to think, but how to assess the quality of their own thinking and reasoning in general. Because knowledge is attained only through thinking crit ically about the reasoning involved in reaching conclusions, managers must be continually asked to reflect on their reasoning and the reasoning manifest in all forms of communication and technical processes. â€Å"Usually critical thinkers are a mixture. They promote root verities and insightful observations on one hand and, then, turn around, and advocate root errors that undo the good they are trying to promote† (Critical Thinking, n.d.). Creative thinking style helps managers to find ‘unique’ solutions in difficult situations and bring together creative ideas. Creative thinking style and management strengths can be characterized as the source of opportunity which lies in know-how decisions. Creative thinking implies new ideas which put into practice through: creation (something new), synthesis (combining concepts), or modification (changing things). Also, researchers distinguish critical and creative thinking.

Twelve Characteristics of Effective Early Childhood Teachers Essay

Twelve Characteristics of Effective Early Childhood Teachers - Essay Example Good teachers strive to read and learn the latest research and instrumental techniques so as to skill their student. They will also be well trained with appropriate developmental characteristics of the age group. Nevertheless, they should develop the love of learning among the students by building on their natural curiosity. They should understand the role of play in young children. They thus provide the necessary equipment (Colker, 2008). It is also essential for them to come up with designs that enable students to develop both large and small motor functions. Good early childhood teachers will use nonbias tools of assessment to monitor the performance of their students. It is tremendously beneficial for them to have excellent classroom management skills with proper rules so as to enhance discipline among students. Lastly they should create an environment whereby students are able to appreciate each other’s differences (Colker,