Strategic Asset Allocation Determining the Optimal Portfolio with Ten Asset Classes Essay Example

Strategic Asset Allocation: Determining the Optimal Portfolio with Ten Asset Classes Essay Strategic Asset Allocation: Determining the Optimal Portfolio with Ten Asset Classes Niels Bekkers Mars The Netherlands Ronald Q. Doeswijk* Robeco The Netherlands Trevin W. Lam Rabobank The Netherlands October 2009 Abstract This study explores which asset classes add value to a traditional portfolio of stocks, bonds and cash. Next, we determine the optimal weights of all asset classes in the optimal portfolio. This study adds to the literature by distinguishing ten different investment categories simultaneously in a mean-variance analysis as well as a market portfolio approach. We also demonstrate how to combine these two methods. Our results suggest that real estate, commodities and high yield add most value to the traditional asset mix. A study with such a broad coverage of asset classes has not been conducted before, not in the context of determining capital market expectations and performing a mean-variance analysis, neither in assessing the global market portfolio. JEL classification: G11, G12 Key words: strategic asset allocation, capital market expectations, mean-variance analysis, optimal portfolio, global market portfolio. This study has benefited from the support and practical comments provided by Jeroen Beimer, Leon Cornelissen, Lex Hoogduin, Menno Meekel, Leon Muller, Laurens Swinkels and Pim van Vliet. Special thanks go to Jeroen Blokland and Rolf Hermans for many extensive and valuable discussions. We thank Peter Hobbs for providing the detailed segmentation of the global real estate market that supplemented his research paper. Last, but not least, we thank Frank de Jong for his constructive comments and useful suggestions during this study. * Corresponding author, email: r. [emailprotected] com, telephone: +31 10 2242855. Electronic copy available at: http://ssrn. com/abstract=1368689 1 Introduction Most previous academic studies agree on the importance of strategic asset allocation as a determinant for investment returns. In their frequently cited paper, Brinson, Hood and Beebower (1986) claim that 93. 6% of performance variation can be explained by strategic asset allocation decisions. This res ult implies that strategic asset allocation is far more important than market timing and security selection. We will write a custom essay sample on Strategic Asset Allocation: Determining the Optimal Portfolio with Ten Asset Classes specifically for you for only $16.38 $13.9/page Order now We will write a custom essay sample on Strategic Asset Allocation: Determining the Optimal Portfolio with Ten Asset Classes specifically for you FOR ONLY $16.38 $13.9/page Hire Writer We will write a custom essay sample on Strategic Asset Allocation: Determining the Optimal Portfolio with Ten Asset Classes specifically for you FOR ONLY $16.38 $13.9/page Hire Writer Most asset allocation studies focus on the implications of adding one or two asset classes to a traditional asset mix of stocks, bonds and cash to conclude whether and to what extent an asset class should be included to the strategic portfolio, see for example Erb and Harvey (2006) and Lamm (1998). However, because of omitting asset classes this partial analysis can lead to sub-optimal portfolios. This is surprising, as pension funds and other institutions have been strategically shifting substantial parts of their investment portfolio towards non-traditional assets such as real estate, commodities, hedge funds and private equity. The goal of this study is to explore which asset classes add value to a traditional asset mix and to determine the optimal weights of all asset classes in the optimal portfolio. This study adds to the literature by distinguishing ten different investment categories simultaneously in a mean-variance analysis as well as a market portfolio approach. We also demonstrate how to combine these two methods. Next to the traditional three asset classes stocks, government bonds and cash we include private equity, real estate, hedge funds, commodities, high yield, credits and inflation linked bonds. A study with such a broad coverage of asset classes has not been conducted before, not in the context of determining capital market expectations and performing a mean-variance analysis, neither in assessing the global market portfolio. The second step in portfolio management, i. e. market timing and security selection are tactical decisions. These are beyond the scope of this study. In short, this study suggests that adding real estate, commodities and high yield to the traditional asset mix delivers the most efficiency improving value for investors. Next, we show that the proportion of non-traditional asset classes appearing in the market portfolio is relatively small. In the remainder of this study we conduct an empirical and literature analysis to establish long-run capital market expectations for each asset class, which we subsequently use in a mean-variance analysis. Then, we provide an assessment of the global market portfolio. Finally, we show how the mean-variance and market portfolio approaches can be combined to determine optimal portfolios. 1 Electronic copy available at: http://ssrn. om/abstract=1368689 2 Methodology and data Methodology Markowitz (1952, 1956) pioneered the development of a quantitative method that takes the diversification benefits of portfolio allocation into account. Modern portfolio theory is the result of his work on portfolio optimization. Ideally, in a mean-variance optimization model, the complete investment opportunity set, i. e. all assets, should be considered simultaneously. However, in pr actice, most investors distinguish between different asset classes within their portfolio-allocation frameworks. This two-stage model is generally applied by institutional investors, resulting in a top-down allocation strategy. In the first part of our analysis, we view the process of asset allocation as a four-step exercise like Bodie, Kane and Marcus (2005). It consists of choosing the asset classes under consideration, moving forward to establishing capital market expectations, followed by deriving the efficient frontier until finding the optimal asset mix. In the second part of our analysis, we assess the global market portfolio. Finally, we show how the mean-variance and market-neutral portfolio approaches can be combined to determine optimal portfolios. We take the perspective of an asset-only investor in search of the optimal portfolio. An asset-only investor does not take liabilities into account. The investment horizon is one year and the opportunity set consists of ten asset classes. The investor pursues wealth maximization and no other particular investment goals are considered. We solve the asset-allocation problem using a mean-variance optimization based on excess returns. The goal is to maximise the Sharpe ratio (risk-adjusted return) of the portfolio, bounded by the restriction that the exposure to any risky asset class is greater than or equal to zero and that the sum of the weights adds up to one. The focus is on the relative allocation to risky assets in the optimal portfolio, in stead of the allocation to cash. The weight of cash is a function of the investor’s level of risk aversion. For the expected risk premia we use geometric returns with intervals of 0. 25%. The interval for the standard deviations is 1% and for correlations 0. 1. In our opinion, more precise estimates might have an appearance of exactness which we want to prevent. We do not take management fees into consideration, except for private equity and hedge funds as for these asset classes the management fees are rather high relative to the expected risk premia of the asset class. Other asset classes have significantly lower fees compared to their risk premia. They are therefore of minor importance, especially after taking the uncertainty of our estimates into account. We estimate risk premiums by 2 subtracting geometric returns from each other. Hereby, our estimated geometric returns as well as the risk premiums both are round numbers. In the mean-variance analysis, we use arithmetic excess returns. Geometric returns are not suitable in a mean-variance framework. The weighted average of geometric returns does not equal the geometric return of a simulated portfolio with the same composition. The observed difference can be explained by the diversification benefits of the portfolio allocation. We derive the arithmetic returns from the geometric returns and the volatility. Data We primarily focus on US data in the empirical analysis. The choice for this market is backed by two arguments. First, the US market offers the longest data series for almost all asset classes. This makes a historical comparison more meaningful. For instance, the high yield bond market has long been solely a US capital market phenomenon. Secondly, using US data avoids the geographical mismatch in global data. A global index for the relatively new asset class of inflation linked bonds is biased towards the US, French and UK markets, while a global stock index is decently spread over numerous countries. We use total return indices in US dollars. Asset classes like real estate and private equity are represented in both listed and non-listed indices, while hedge funds are only covered by non-listed indices. Non-listed real estate and private equity indices are appraisal based, which may cause a smoothing effect in assumed risk of the asset class. This bias arises because the appraisals will not take place frequently. However, interpolating returns causes an underestimation of risk. Also, changes in prices will not be immediately reflected in appraisal values until there is sufficient evidence for an adjustment. Statistical procedures to mitigate these data problems exist, but there is no guarantee that these methods produce accurate measures of true holding-period returns, see Froot (1995). As these smoothing effects can lead to an underestimation of risk, this study avoids non-listed datasets and instead adopts listed indices for real estate and private equity. The quality of return data of listed indices is assumed to be higher as they are based on transaction prices. Ibbotson (2006) supports this approach and states â€Å"Although all investors may not yet agree that direct commercial real estate investments and indirect commercial real investments (REITs) provide the same risk-reward exposure to commercial real estate, a growing body of research indicates that investment returns from the two markets are either the same or nearly so. †. For hedge funds we will use a fund of fund index that we unsmooth with Geltner (1991, 1993) techniques. Fung and Hsieh (2000) describe the important role of funds of hedge funds as a proxy for the market portfolio of hedge funds. Appendix A and B contain our data sources. In appendix A we discuss our capital market expectations and in appendix B we derive the market portfolio from a variety of data sources. 3 3 Empirical results Capital market expectations We estimate risk premia for all asset classes based on previous reported studies, our own empirical analyses of data series and on the basic idea that risk should be rewarded. Obviously, estimates like these inevitably are subjective as the academic literature only provides limited studies into the statistical characteristics of asset classes. Moreover, there is generally no consensus among academics and we lack long term data for most asset classes. Our results should therefore be treated with care, especially since mean-variance analysis is known for its corner solutions, being highly sensitive in terms of its input parameters. In this study we proceed with the risk premia and standard deviations as shown in Table 1. Appendix A contains the reasoning for these estimates and for the correlation matrix. [INSERT TABLE 1] Mean-variance analysis Table 2 shows the optimal portfolio based on the mean-variance analysis and its descriptive statistics for a traditional portfolio with stocks and bonds as well as a portfolio with all assets. On top of the traditional asset classes of stocks and bonds, this analysis suggests that it is attractive for an investor to add real estate, commodities and high yield. The Sharpe ratio increases from 0. 346 to 0. 396. The allocation to real estate is quite high. To bring this into perspective, we would suggest that the proposed portfolio weight is overdone. When one, for example, would be willing to perceive utilities as a separate asset class, it is likely that it also would get a significant allocation as this sector also has a low correlation to the general stock market. Table 2 also illustrates that mean-variance analysis tends towards corner solutions as it neglects credits which has characteristics comparable with bonds. However, with these parameters it prefers bonds in the optimal portfolio. [INSERT TABLE 2] Figure 1 shows the benefits of diversification into non-traditional asset classes. In the volatility range of 7% to 20% the diversification benefits vary between 0. 40% and 0. 93%. This additional return is economically significant. For example, at a volatility of 10% the additional return is 0. 56%. The efficient 4 frontier of a portfolio with stocks, bonds and the three asset classes real estate, commodities and high yield comes close to the efficient frontier of an all asset portfolio. By adding these three asset classes, an investor almost captures the complete diversification benefit. [INSERT FIGURE 1] For various reasons not all investors use cash to (un)leverage their investment portfolio. Therefore, it is interesting to observe the composition of efficient portfolios in a world without the risk free rate. Figure 2 shows the asset allocation on the efficient frontier in an all asset portfolio starting from a minimum variance allocation towards a risky portfolio. It maximizes the expected excess return constrained by a given volatility. [INSERT FIGURE 2] In the least risky asset allocation, an investor allocates 77. 7% of the portfolio towards fixed-income assets. Next to bonds and stocks, real estate and commodities receive a significant allocation in portfolios with a volatility in the range of 7. %-12. 5%. High yield is also present in most of the portfolios in this range. For riskier portfolios, private equity shows up and, in the end, it ousts bonds, real estate, commodities and stocks (in this order). For defensive investors, inflation linked bonds and hedge funds enter the portfolio. We have tested the sensitivity of the mean-variance analysis to the input parame ters. Table 3 shows the impact on the optimal portfolio of an increase and a decrease in the expected volatility of an asset by a fifth, all other things being equal. Note that a change in volatility affects both the arithmetic return and the covariance matrix. Again, this table demonstrates the sensitivity of a mean-variance analysis to the input parameters. An increase in expected volatility leads to a lower allocation to that asset class. High yield even vanishes completely from the optimal portfolio. It is noteworthy that commodities are hardly affected by a higher standard deviation. A decrease in volatility mostly leads to a higher allocation, with the exception of hedge funds and commodities. Commodities, despite their expected zero risk premium, add value due to the strong diversification benefit. In this analysis, they appear to be insensitive to a change in their expected volatility. Credits and bonds are quite similar asset classes and, in a mean-variance context, the optimal portfolio tends to incline towards one or the other. [INSERT TABLE 3] In short, the mean-variance analysis suggests that adding real estate, commodities and high yield to the traditional asset mix of stocks and bonds creates most value for investors. Basically, adding these 5 three asset classes comes close to an all asset portfolio. Private equity is somewhat similar to stocks, but shows up in riskier portfolios, moving along the efficient frontier. This part of the efficient frontier is interesting for investors in search of high returns without leveraging the market portfolio. Hedge funds as a group do not add value. Obviously, when investors attribute alpha to a particular hedge fund, it changes the case for that fund. This also applies to private equity. Credits and bonds are quite similar asset classes and in a mean-variance context the optimal portfolio tends to tilt to one or another. Inflation linked bonds do not show up in our mean-variance analysis. The inflation risk premium and the high correlation with bonds prevent an allocation towards this asset class in that setting. However, for defensive investors who primarily seek protection against inflation this asset class can be very interesting. Market portfolio Both academics and practitioners agree that the mean-variance analysis is extremely sensitive to small changes and errors in the assumptions. We therefore take another approach to the asset allocation problem, in which we estimate the weights of the asset classes in the market portfolio. The composition of the observed market portfolio embodies the aggregate return, risk and correlation expectations of all market participants and is by definition the optimal portfolio. In practice however, borrowing is restricted for most investors and at the same time borrowing rates usually exceed lending rates. The result is that the market portfolio is possibly no longer the common optimal portfolio for all investors, because some might choose risky portfolios on the efficient frontier beyond the point where no money is allocated to the risk free rate. In addition, an investor’s specific situation could also lead to a different portfolio. Despite this limitation, the relative market capitalization of asset classes provides valuable guidance for the asset allocation problem. In this setting, the market-neutral weight for a particular asset class is its market value relative to the world’s total market value of all asset classes. Figure 3 shows the global market portfolio based on a variety of data sources. Appendix B provides details about the market portfolio and its dynamics for the period 2006-2008. The asset classes stocks and investment grade bonds (government bonds and credits) represent more than 85% of the market for these years. At the end of 2008 we estimate this number at 88. 8%. This means that the size of the average remaining asset class is less than 2. 0%. Based on this analysis, we conclude that the proportion of non-traditional asset classes appearing in the market portfolio is relatively small. [INSERT FIGURE 3] 6 Combination of market portfolio and mean-variance analysis The mean-variance analysis can be combined with the market portfolio. Here, we choose to take the market portfolio as a starting point which we subsequently optimize with turnover and tracking error constraints. We choose to take the market portfolio as a starting point, as it embodies the aggregate return, risk and correlation expectations of all market participants without the disadvantage of delivering the corner solutions of the mean-variance analysis. Table 4 shows the optimal portfolios with different tracking error constraints and a maximum turnover of 25% (single count) relative to the market portfolio. In other words, in this example we limit ourselves to finding optimized portfolios with portfolio weights that do not differ more than 25% from the market portfolio, calculated as the sum of the absolute difference between the market portfolio and the optimized portfolio for each asset class. Focusing on the 0. 25% tracking error constraint, it appears that the analysis recommends especially adding real estate, commodities and high yield, and removing hedge funds and inflation-linked bonds. This is logical, as the results from the meanvariance analysis are applied in this market-portfolio-adjustment process. There is a 12. 5% shift in portfolio weights. Obviously, less constraints result in a higher risk premium and a higher Sharpe ratio, until we end up with the theoretically optimal portfolio from the mean-variance analysis. Within this methodology, investors must determine their own individual constraints, while the market portfolio and the portfolio optimized by mean-variance are considered as the boundaries for the asset classes. [INSERT TABLE 4] 4 Summary and conclusions Our mean-variance analysis suggests that real estate, commodities and high yield add most value to the traditional asset mix of stocks, bonds and cash. Basically, adding these three asset classes comes close to an all asset portfolio. The portfolio with all assets shows a diversification benefit along the efficient frontier that varies between 0. 40% and 0. 93% in the volatility range of 7% to 20%. That is an economically significant extra return for free. Another approach to the asset allocation problem is assessing the weights of the asset classes in the market portfolio. Based on this analysis we conclude that the proportion of non-traditional asset classes appearing in the market portfolio is relatively small. 7 One can combine the mean-variance analysis with the market portfolio. Within this methodology, investors must determine their own individual constraints, while the market portfolio and the portfolio optimized by mean-variance are considered as the boundaries for the asset classes. 8 References Altman, E. I. , 1998, â€Å"The Anatomy of the High Yield Bond Market: After Two Decades of ActivityImplications for Europe†, research paper. Amin, G. , and H. Kat, 2005, â€Å"Welcome to the Dark Side: Hedge Fund Attrition and Survivorship Bias 1994-2001†, Journal of Alternative Investments, vol. 6, no. 2, 57-73. Bodie, Z. , A. Kane and A. Marcus, 2005, â€Å"Investments†, McGraw-Hill, sixth dition. Brinson, G. P. , L. R. Hood and G. L. Beebower, 1986, â€Å"Determinants of Portfolio Performance†, Financial Analysts Journal, vol. 42, no. 4, p. 39-44. Dimson, E. , P. Marsh and M. Staunton, 2003, â€Å"Global Evidence on the Equity Risk Premium†, Journal of Applied Corporate Finance, vol. 15, no. 4, p. 27-38. Dimson, E. , P. Mars h and M. Staunton, 2009, â€Å"Global Investment Returns Sourcebook 2009†, Credit Suisse. Doyle, E. , J. Hill and I. Jack, 2007, â€Å"Growth in Commodity Investment: Risks and Challenges for Commodity Market Participants†, study from the FSA Markets Infrastructure Department. Elton, E. J. , M. J. , Gruber and D. M. C. Agrawal, 2001, â€Å"Explaining the Rate Spread on Corporate Bonds†, Journal of Finance, vol. 56, no. 1, 247-277. Erb, C. B. , and C. R. Harvey, 2006, â€Å"The Tactical and Strategic Value of Commodity Futures†, Financial Analysts Journal, vol. 62, no. 2, p. 69-97. Fama, E. F. , and K. R. French, 2002, â€Å"The Equity Premium†, Journal of Finance, vol. 57, no. 2, p. 637660. Froot, K. A. , 1995, â€Å"Hedging Portfolios with Real Assets†, Journal of Portfolio Management, vol. 21, no. 4, p. 60-77. Fugazza, C. , M. Guidolin and G. Nicodano, 2007, â€Å"Investing for the Long-Run in European Real Estate†, Journal of Real Estate Finance and Economics, vol. 34, no. 1, p. 35-80. 9 Fung, W. , and D. A. Hsieh, 2000, â€Å"Performance Characteristics of Hedge Funds and Commodity Funds: Natural vs. Spurious Biases†, Journal of Financial and Quantitative Analysis, vol. 35, no. 3, p. 291-308. Geltner, D. M. , 1991, â€Å"Smoothing in Appraisal-Based Returns†, Journal of Real Estate Finance and Economics, vol. 4, no. 3, 327-345. Geltner, D. M. , 1993, â€Å"Estimating Market Values from Appraised Values without Assuming an Efficient Market†, Journal of Real Estate Research, vol. 8, no. , 325-345. Gorton, G. , and K. G. Rouwenhorst, 2006, â€Å"Facts and Fantasies about Commodity Futures†, Financial Analysts Journal, vol. 62, no. 2, p. 47-68. Graham, J. R. , and C. R. Harvey, 2008, â€Å"The Equity Risk Premium in 2008: Evidence from the Global CFO Outlook Survey†, working paper. Graybill, F. A. , 1983, â€Å"Matrices with Applications in Statistics†, Wadsworth International Group, California. Grishchenko, O. V. , and J. Huang, 2008, â€Å"Inflation Risk Premium: Evidence from the TIPS Market†, working paper. Hammond, P. B. , 1999, â€Å"Using Inflation-Indexed Securities for Retirement Savings and Income: The TIAA-CREF Experience†, in J. Brynjolfsson and F. J. Fabozzi, Handbook of Inflation Indexed Bonds, New Hope. Hordijk, A. C. , and C. Ahlqvist, 2004, â€Å"European Market Dimensions: An Inventory of the Investable Market in 11 European Countries†, The Compendium of Real Estate Papers 2. Ibbotson, 2007, â€Å"Private Equity and Strategic Asset Allocation†, research paper. Ibbotson, 2006, â€Å"Commercial Real Estate: The Role of Global Listed Real Estate Equities in a Strategic Asset Allocation†, research paper. Jong, F. de, and J. Driessen, 2005, â€Å"Liquidity Risk Premia in Corporate Bond Markets†, working paper. 10 Kaplan, P. D. , and S. L. Lummer, 1998, â€Å"GSCI Collateralized Futures as a Hedging and Diversification Tool for Institutional Portfolios: An Update†, Journal of Investing, vol. 7, no. 4, p. 11-17. Kaplan, S. N. , and A. Schoar, 2005, â€Å"Private Equity Performance: Returns, Persistence, and Capital Flows†, Journal of Finance, vol. 60, no. 4, p. 1791-1823. Lamm, R. M. , 1998, â€Å"Asset Allocation Implications of Inflation Protection Securities†, Journal of Portfolio Management, vol. 24, no. 4, p. 8-13. Li, L. , 2002, â€Å"Macroeconomic Factors and the Correlation of Stock and Bond Returns†, working paper. Liang, Y. , and N. M. Gordon, 2003, â€Å"A Bird’s Eye View of Global Real Estate Markets†, Prudential Real Estate Investors, research paper. Lummer, S. L. , and L. B. Siegel, 1993, â€Å"GSCI Collateralized Futures: A Hedging and Diversification Tool for Institutional Portfolios†, Journal of Investing, vol. 2, no. 2, 75-82. Markowitz, H. M. , 1952, â€Å"Portfolio Selection†, Journal of Finance, vol. 7, no. 1, p. 77-91. Markowitz, H. M. , 1956, â€Å"The Optimization of a Quadratic Function Subject to Linear Constraints†, Naval Research Logistics Quarterly, vol. 3, no. 1-2, 111-133. Masters, M. W. , 2008, Testimony Before the US Senate. McKinsey Global Institute, 2007, â€Å"The New Power Brokers: How Oil, Asia, Hedge Funds, and Private Equity are Shaping Global Capital Markets†, research paper. McKinsey Global Institute, 2008, â€Å"Mapping the Global Capital Markets Fourth Annual Report†, research paper. Norman, E. J. , G. S. Sirmans and J. D. Benjamin, 1995, â€Å"The Historical Environment of Real Estate Returns†, The Journal of Real Estate Portfolio Management, vol. 1, no. 1, p. 1-25. Ong, S. E. , and M. Ranasinghe, 2000, â€Å"Portfolio Variance and Correlation Matrices†, Journal of Real Estate Portfolio, vol. 6, no. 1, p. 1-6. Phalippou L. 2007, â€Å"Investing in Private Equity Funds: A Survey†, working paper. 11 Phalippou, L. , and O. Gottschalg, 2007, â€Å"The Performance of Private Equity Funds†, Review of Financial Studies, forthcoming. Posthuma, N. , and P. J. van der Sluis, 2003, â€Å"A Reality Check on Hedge Fund Returns†, working paper. Hobbs, P. , and H. Chin, 2007, â€Å"The Future Size of the Global Real Estate Market†, RREEF research paper. Swensen, D. F. , 2000, â€Å"Pioneering Portfolio Management†, Free Press, New York. Welch, I. , 2008, â€Å"The Consensus Estimate for the Equity Premium by Academic Financial Economists in December 2007†, working paper. Wilshire, 2008, â€Å"Report on State Retirement Systems: Funding Levels and Asset Allocation†, research paper. 12 Appendix A: Capital market expectations Risk premia for stocks and bonds are well documented and long term data series extending over 100 years are available. We will therefore start with the risk premia for stocks and bonds. Then, we derive the risk premia of other asset classes by comparing historical performance data and consulting the literature. In order to estimate volatilities and correlations, we rely more on our own historical data, due to a lack of broad coverage in the literature. Below, we discuss returns and standard deviations for each asset class. Afterwards, we estimate correlations among all asset classes. Stocks Extensive research on the equity-risk premium has been conducted in recent years. Fama and French (2002) use a dividend discount model to estimate an arithmetic risk premium of 3. 54% over the period 1872-2000 for US stocks, while the realized risk premium for this period is 5. 57%. In the period 19512000, the observed difference is even larger. They conclude that the high 1951-2000 returns are the result of low expected future performance. However, the US was one of the most successful stock markets in the twentieth century, so a global perspective is important to correct this bias. Dimson, Marsh and Staunton (2009) use historical equity risk premia for seventeen countries over the period 1900-2008. They conclude that their equity risk premia are lower than frequently cited in the literature, due to a longer timeframe and a global perspective. Table A. 1 provides an overview of historical risk premia and volatilities. TABLE A. 1 OVERVIEW OF HISTORICAL RISK AND RETURN CHARACTERISTICS FOR STOCKS SOURCE COUNTRY RISK ST. DEV. ANN. ST. DEV. PREMIUM OF MONTHLY ON CASH RETURNS MSCI US US 3. 1% 18. 4% 15. 4% MSCI WORLD WORLD 3. 0% 18. 8% 14. 8% FAMA AND FRENCH (2002)* US US US US UK WORLD 3. 9% 2. 5% 6. 0% 5. 2% 4. 2% 4. 4% 18. 5% 19. 6% 16. 7% 20. 2% 21. 8% 17. 3% 22. 0% N. A. N. A. N. A. N. A. N. A. N. A. 16. 0% DATA 1970-2008 1970-2008 1872-2000 1872-1950 1951-2000 1900-2008 1900-2008 1900-2008 1970-2008 DIMSON, MARSH AND STAUNTON (2009) ST. DEV. OF MSCI WORLD IN EUROS * STANDARD DEVIATION OF THE RISK PREMIUM INSTEAD OF THE STANDARD DEVIATION OF THE NOMINAL RETURN. WE DERIVE GEOMETRIC DATA BY USING THE EQUATION RG = RA 0. 5*VARIANCE Both Fama and French (2002) and Dimson, Marsh and Staunton (2003, 2009) find that the historical equity premium was significantly higher in the second half of the twentieth century than it was in the first half. Dimson, Marsh and Staunton (2009) expect a lower equity premium in the range of 3. 0%- 13 3. 5% going forward. In this study we use an equity risk premium of 4. 75%. This is slightly above the average of countries in a long timeframe and corresponds well with consensus estimates among finance professors as documented by Welch (2008) and among CFOs as reported by Graham Harvey (2008). The other estimate we need is stock market volatility. Dimson, Marsh and Staunton (2009) find a standard deviation of 17. 3% for global equity during the 109 year period 1900-2008. Over the period 1970-2008 the global MSCI index had a volatility of 18. 8% and 22. 0% expressed in dollars and euros respectively. We average these last two figures and estimate the volatility of stocks at 20%. 1 Government bonds Dimson Marsh and Staunton (2009) also evaluate the risk premium of bonds over cash. Their data point to a lower risk premium than the Barclays Government Indices which have been available since 1973, see Table A. . The last decades have been extremely good for government bonds. We use a geometric risk premium of 0. 75% for government bonds over cash, in line with the long term historical average from Dimson, Marsh and Staunton (2009). TABLE A. 2 OVERVIEW OF HISTORICAL RISK AND RETURN CHARACTERISTICS FOR GOVERNMENT BONDS SOURCE COUNTRY RISK ST. DEV. ANN. ST. DEV. PREMIUM OF MONTHLY ON CASH RETURNS BARCLAYS TREASURIES US 2. 2% 6. 5% 5. 4% US 3. 6% 6. 3% 5. 0% US 3. 0% 5. 5% 4. 8% DIMSON, MARSH AND STAUNTON (2009) US UK WORLD 1. 2% 0. 4% 0. 8% 8. 3% 11. 9% 8. 6% N. A. N. A. N. A. DATA 973-2008 1984-2008 1999-2008 1900-2008 1900-2008 1900-2008 The volatility of bonds has been significantly lower in

Implementing Leadership Change

Implementing Leadership Change Introduction Leadership refers to an active activity undertaken by someone whose position on a vertical, and usually formal, hierarchy provides the individuals with the resources to lead. Such individuals exhibit and have some degree of mandate over other individuals within any given organization, on certain issues that affect the routine running of the organization. They influence the aid and support of others in the accomplishment of a common task.Advertising We will write a custom assessment sample on Implementing Leadership Change specifically for you for only $16.05 $11/page Learn More Leadership is traditionally related to a spatial position in a formal or informal organization. It entails setting a new direction for a given group. Management is used to control and direct people and resources available in a group, according to the already established principles and values within a given organization (Grint, 2010). Leadership, management and size An org anization is a collective association of a variety of individuals who possess varied opinions, values, aspirations, cultures, and other individual characters, which are self-centered on individuals. The size of the group has a significant impact on both leadership style and effectiveness. The greater the size of the organization, the more the diverse distribution of such individual characters and the more the chances of conflict arising within the individuals and their leaders. Participative leadership styles are more difficult and consume lots of time for individual attention. There is reduced individual participation, interaction, stability, and communication resulting into reduced effectiveness of leadership within large groups. The standard of leadership within large groups is lowered due to less scrutiny by team members, hence causing laxity in duty performance. There is a feeling of inequality by the individuals at the expense of the leadership because not all the individuals will be satisfied by the present leadership. The systematic leadership approach used may be viewed as inappropriate by majority of opinionated individuals who gang up to criticize leadership perspectives. Such factors affect the management control activities through breaching of the principles of the organization because the larger the group the less effective the management of the resources and their effective distribution.Advertising Looking for assessment on business economics? Let's see if we can help you! Get your first paper with 15% OFF Learn More Strategies Funds are a major factor affecting productivity of any given organization. An increase in funding will ensure that the basic working equipments, human labor, and other factors of production are increased by a marginal percentage leading to an increase the overall productivity of the organization and an increase in the profitability and efficiency of service delivery guaranteeing an increased retur n on capital investments of the company. Increased funding while going public will ensure the popularity of the organization, and a greater penetration into the corporate world. This strategy will enable the organization to have competitive advantage within the years increasing the quality of production and service delivery. Development and introduction of new products will enable the company minimize competition from other substitute products from other companies. Adoption and acceptance of the new products into the market will increase daily sales, income, and overall profit of the company because the products are unique and produced by only one company. This will enable the company have a constant clientele because of the introduction of the new products. However, this majorly depends on the tastes and preferences of the consumers. If the new products are concurrent with the consumer’s needs, there will be increased consumption. In addition, reasonable time will be investe d in consumer orientation of the new products while in the markets which would marginally affect the desired outcomes of the company (Chakravarthy, 2003). Conclusion Both leadership and management control are vital in the effective running of any organization, because they are both geared towards a common goal to be achieved within the organization. References Chakravarthy, B. (2003). Strategy process: shaping the contours of the field. Oxford: Wiley-Blackwell. Retrieved from https://books.google.com/books?id=1SQe50oIcwsCprintsec=frontcoversource=gbs_atbredir_esc=y#v=onepageqf=trueAdvertising We will write a custom assessment sample on Implementing Leadership Change specifically for you for only $16.05 $11/page Learn More Grint, K. (2010). Leadership: a very short introduction. New York: Oxford University Press. Retrieved from https://books.google.com/books?id=uRRtl6GRpiICprintsec=frontcoverdq=Leadershiphl=enei=KvACTrKZMsSCOou96fcNsa=Xoi=book_resultct=resul tredir_esc=y#v=onepageqf=false

Martin Luther Essay Example | Topics and Well Written Essays - 500 words - 2

Martin Luther - Essay Example He expressed his concerns regarding papacy in the interpretation of scriptures. After being ordered to recant his ninety-five theses on papacy, he was engaged in a meeting that resulted into his excommunication from the church. However, this was not the end of Luther in the revolution of religion. Luther’s efforts in interpretation of scriptures brought revolution to Christianity that is appreciated by many Christians to this date1. Luther contributed massively to the development of the German language by interpreting the Bible into German language. He believed that translation of the Bible into other languages would help people understand the scriptures better. The translation of the Bible into German can be considered a milestone in the interpretation of scriptures. The translation of the Bible into different world languages as evident in the modern religion can be attributed to Luther’s efforts. Moreover, the growth of the German language is also attributed Luther’s efforts in the translation of the Bible to German. The massive spread of German language in Europe can also be attributed to the brave efforts by Luther to enable people understand religion in their own language. Luther was a controversial figure but influential at the same time. He is credited for the revolution of Christianity. He fractured the Roman Catholic Church and set a new direction of Christianity. The development of protestant churches began from his arguments. The current freedom in Christianity roots back to Luther’s time and efforts. His theological approaches changed the relationship between religious leaders and their followers. His prominence came at a time when there was high tension between the central powers of Europe and different principalities. Religion was used to control almost every aspect of people’s lives. The awakening of people on the state of religion at the time is still significant to this day. He was able to convince people on the

State Government Levy Tariffs on Imports Coursework - 1

State Government Levy Tariffs on Imports - Coursework Example The population of retired workers in America was 37.9 million as at December 2013, for instance (Center on Budget and Policy Priorities, 2014). An increase in expenditure on Social Security and Medicare would hurt taxpayers and federal government on other sectors. Currently, the Federal government’s expenditure on other sectors such defense and sectors of security are equally high. Expenditure on defense and other sectors of security was $643 billion in 2013, representing 19 percent of the entire budget. Furthermore, the federal government’s expenditure is growing at a rate of 63 percent higher than the level of inflation, a trend that has been consistent for the past 20 years (Boccia, 2014). Based on the high level of expenditure that the federal government already has on social security and Medicare, it is unjustified to increase it. Lee, Johnson and Joyce (2008) recognize social security as a key income source for the retired. An increase would imply a consequential rise in the national debt. The greatest concern relates to a large population of retirees. Viable recommendations for the elderly to fund their retirement include proper use of personal savings. Programs to help the elderly boost personal investments would help them finance their retirement. Boccia, R. (2014). Federal Spending by the Numbers, 2014: Government Spending Trends in Graphics, Tables, and Key Points (Including 51 Examples of Government Waste). The Heritage Foundation. Retrieved December 14, 2014 from,

Case Study on network solution Example | Topics and Well Written Essays - 1000 words

On network solution - Case Study Example The Cisco Unified Wireless Network allows efficient running and monitoring of a combination of mobile packages from the dental offices while keeping a check on practitioners who tend to their clients from homes. The dentists may carry along the Cisco Wireless IP 7921 phones to monitor their patients, watch their state, and fill in medical records from the remote places. The remote application offers superior accuracy, feasibility, and security of the patient’s status. Dentists enjoy real time data access and entry. They can use the automated medical statements via wireless devices such as laptops and portable computers. Remotely operated X-ray machines attend to patients from the comfort of their homes. Hand operated scanners also ease the screening and examination while enabling efficient access to patient records and prescription. Since the patients have personalized barcodes, dentists are able to recover and revise clinical reports at once by searching through the codes. Th e Cisco Wireless Network is set to raise communication levels within the departments at the hospital, thus enhancing first rate patient precautions and workforce employee contentment (Pahlavan & Krishnamurthy, 2009). 2. Identify the information that is to be protected and the related security requirements HIPAA holds an in depth account of requisites for the utilization or release of confidential or protected health information. Protected units may only utilize and release PHI as allowed by HIPAA and other restrictive bodies and state bylaws. Generally, the private units at the dental dispensary may use PHI, regardless of exceptional consent from a patient. Health care â€Å"operations† consist of undertakings such as quality reassurance, peer analysis, guidance, and business development procedures. Prior to the first examination of the patients, the dentist must present them with a Notice of Privacy Practices explaining the steps concerning future reference of their health i nformation and the extent of liberties they can enjoy in respect to the PHI. After an Electronic Health Record (EHR) is put into practice, there are also requirements that facilitate disclosures for TPO (Pahlavan & Krishnamurthy, 2009). 3. Identify the types of network(s), components, devices, and equipment that would be involved in meeting the needs of the stationary offices and the mobile dentists Location database: within the Cisco Unified Wireless Network, the initial hop router gets packages for the remote clients through the routing code operating on the given network and pushes them through a trunk into the WLC. All WLC maintain a file of remote clients as they travel between the APs affiliated to them. In portable IP, the Home Agent (HA) holds the local database. Move discovery: if the wireless users move to a fresh AP, they have to depend on the alternate configuration to be accessed by the remote network. The association packets are pushed forward to the WLC through the as sociation process stage to mark out the wireless user and his new location (AP), where the wireless client is trying to connect. The data is utilized by WLC to renew its location database (the WLC mobility database). Where the client may have strayed into a new WLC, the initial WLC linked to the remote customer presents packets directed towards the wireless client to the isolated WLC. In Mobile IP, the user subscribing to the wireless network may not give HA any

Celebrity Endorsement And Its Impact On Sales

Celebrity Endorsement And Its Impact On Sales Results show that celebrity endorsement has a large impact on purchase intention and is infact a causal factor based on the data obtained through this research. All three factors are said to positively affect purchase intention and the results are magnified when all three factors are present. It is seen that the most significant impact is that of physical attractiveness if taken in isolation and the most significant impact is that of celebrity / brand congruence when all three factors are taken into account. What this means is that without physical attractiveness, the impact of the other two factors is negated (in the absence of physical attractiveness, purchase intention will not increase) but the presence of physical attractiveness alone does not have a significant impact on purchase intention. Thus physical attractiveness is an important first step but it is not the most important reason for increase in purchase intention. That belongs to brand / celebrity congruence, which is consistent with previous studies on the subject matter: Choose celebrities which have a good image fit with the brand, otherwise the impact of the celebrity endorsement is minimal. The author concludes by stating that all three are important factors in making an impact on purchase intention through advertisement and thus when choosing a celebrity endorser, all three factors must be taken into account. Celebrity Endorsement and its Impact on Sales Jain (2011) proposes that the increase in celebrity endorsement in the subcontinent in recent years, despite the rising costs is due to the increase in media coverage in the area and the increase in hero worship as well. This has been outlined as the major reasons for increase in persuasiveness of celebrities, which in turn has resulted in an increase in their demand by corporations to endorse their respective brands. The research documents the impact of celebrity endorsement with a focus on the subcontinent, making it pertinent to this study. It is queried as to whether the relationship is always positive or whether there can be negative consequences as well. It is noted that for most brands, the focus has shifted from creating awareness and bringing attention towards their brands to a more contemporary approach, which is to create positive associations within the minds of the consumers and to capture a share of mind, share of heart, share of wallet and share of spirit. This is the essence of branding in todays world and as such, all marketing and advertising actions that are conducted are done so with this end goal in mind. The study researches the idea that celebrity endorsement leads to fulfillment of such goals or are they successful only in capturing the attention of the consumer and creating awareness without moving the consumer to the next stage. Celebrities are thought of as a link between the brand and the consumer and help to ease the process of purchase intention and thus it is imperative that the best celebrity be chosen, the one that is right for the brand and has the potential to create the maximum impact on sales as well as brand equity. As pointed out by other studies, endorsement helps brands to deal with clutter and that is the major reason to use celebrities, instead of everyday men and women in advertisement. One of the major decision criteria which helps corporations choose a celebrity is known as the Q-Rating. This Q rating helps brands to select a celebrity based on the rating that they have with the consumers. This rating is derived, based on a number of criteria but essentially boils down to two: who known is the celebrity and how liked is the celebrity. These two criteria form the backbone of the Q Rating system that helps corporations choose which celebrity is the best fit for their brand. The impact of celebrity endorsement is said to be based on 10 criteria, with the greater the score of the celebrity in each criteria, the greater the impact on sales and purchase intention. Celebrity / Target Market Match: How strongly target market associates itself with the celebrity in question. Celebrity Values: The link between the values of the celebrity and the values of the target audience, thus creating a link for the consumers with the brand. Cost of Celebrity: The cost of the celebrity is generally an indication of the popularity of the celebrity and the higher the cost, the higher the popularity, thus the greater the chance of the celebrity persuading consumers. However the cost should always be compared to the added benefit and the go ahead should only be given if its established that there is sufficient benefit from the increase in cost. Regional Appeal: Different regions may have different appeals within a country and if a product is to be sold throughout the country, it is best to choose a celebrity with relative universal appeal. Celebrity Product Match: The celebrity should be seen as having an image fit with the brand itself, as it is one of the key factors when trying to increase sales. Celebrity Controversy Risk: The greater the chances that the celebrity may be involved in controversy, the lesser the chances that he or she would have a positive long term impact on sales and thus should be avoided. Popularity: The greater the popularity, the greater the chances of brand recall and thus they have a high cost. It should be noted that in order to save cost, popularity should not be forgone. Availability: The best celebrities may not be available due to other endorsement commitments or there is a conflict of interest due to them endorsing a rival brand. In such a case, it is best to move on and choose the next best alternative. Attractiveness: Attractiveness helps celebrities be more likeable and to connect more with the target market and as such this is an important attribute to look for in a celebrity. Credibility: This helps the consumers to trust what the celebrity is saying and to pay more attention to him or her and what he or she is endorsing. This research is important as it looks at the factors within the partnership of a celebrity and a corporation and how they increase or decrease their impact on the impact of celebrity endorsement on sales and as such helps to decide how and when celebrities should be chosen as endorsers. Impact of celebrity Endorsement on Overall Brand In order to select a celebrity for a given product, there should be an optimal match between celebrity and brand image. Here are some parameters which should be considered: (Katyal, 2010): Celebritys personal character is not controversial Personal character fits with the image of the product / brand Cost of hiring the celebrity is worth the output Is there any controversy risk attached after the ad campaigns launched Celebritys popularity Is the celebritys appeal local or regional and does it fit with the appeal of the product in terms of region Celebritys overall credibility Is the celebrity him or herself a brand user? What is celebrity profession? Does it matches to have a natural match to the product and appeal to the consumers. For example, celebrity figure from sport is natural to promote sports related stuff and footwear. What values celebrity is associated with the product? If a celebrity is put in a role to propagate the human service cause does he/she be social worker or figure. Does target audience want to believe in the celebrity for the target product to be advertised or message to be conveyed. After advent of television, cable television, and internet, advertisement industry got revolutionized. New trends and format were introduced for rapid and technical way to impress the public and numerous items, products and services became the household names. Television though invented in 1920s became commercial medium in 1950s. This happen when a price of the television sets began to approach affordable range of average person. Print and Radio had to take back seat to give a way to the new technologies. Now the commercials could be broadcasted with sight, sound, and motion. First time in the history advertisers saw huge potential of multimedia technologies which could give higher gains in sales and profits provided right tools and ideas were selected. Cable television channel introduced channels like MTV for young music lovers, ESPN for sports enthusiasts and Food Networks for people with love of cooking. These new channels were attractive and fun for advertisers who wish to target certain audience for example; entertainment, sports, or food (Sample, 2010). Celebrities in Advertising Personal in marketing have used celebrities in commercials, print campaigns and promotions and other seller techniques for years. It has worked in the past because it was executed properly. However, use of celebrities to grab viewers attention to eventually make sales depends on proper celebrity casting. The right selection of star to pitch the product will mean that the buyers can relate to that person the person a buyer would want to believe in. It is not as simple as you think it is because in many cases the right celebrity is not always affordable. On the flip side, the right celebrity is not always the most expensive one either. Above all else, the most important resides in considering whether the celebrity you select is right for your campaign and take the process from there. Another key factors that one must take into account is the fact that advertisers should understand the basic premise of hiring the celebrity and making it clear to him what is required and the nature of the exact role of the celebrity. If this is successful, companies may retain the celebrity for other products of their brand, making the celebrity more of a brand ambassador than a product endorser. Celebrities can be seen as a marketing vehicle that will likely to continue in the near future. As long as there are new stars being introduced into our entertainment arenas there will be no shortage of talent to fill the need. Though, doing the selection and positioning right is the biggest challenge but if done correctly it can translate into better response and higher sales volume. The equity effect of endorsement by celebrities: A conceptual framework The purpose of this study was create a framework which may be later used to organize and guide future research into how celebrity product endorsement creates equity for both the endorsed product-brand and the endorsing celebrity. The focus of Diana Senos study was how the celebrity as well as the brand could serve to increase equity for each other, essentially feeding off each others image to mutually benefit each other. It looked at the relationship between the endorser and the company and how a strategic fit could be achieved by utilizing the best fit of celebrity for the product to be endorsed. The central findings of the research state that celebrity endorsement is a form of co-branding and that both endorser image and brand image serve as mediators in the equity-creation process of celebrity product endorsement. Mobile brands connect with Pakistan Umair Naeem examines the relationship and industry effects of celebrity endorsement on the telecommunications sector. Umair states how the increase in competition has led cellular service providers to resort to differentiating their brands less on the basis of functionality and features and increasingly on the basis of emotional appeal and a certain message that is sent across. Celebrity endorsements are heavily used to drive home the emotional appeal and to personify the message that is being sent across. Using Mobilink as an example he states, Mobilinks sub-brand Indigo relied heavily on two factors toward establishing its brand equity: brand ambassadors that exuded style and sophistication, and a unique classy look that permeate all forms of its Indigo brand communication. Indigo used models such as Zainab Qayum, movie stars like Shaan, and popular musicians such as Strings to infuse style into its branding. It also played on the aspirations of young business professionals through the atmosphere and the locales of Indigos ads. He believes celebrity endorsement is currently necessary to differentiate the brands which are increasingly similar in features and thus celebrities help to personify the brands qualities. The naked truth of celebrity endorsement This research was conducted to understand how celebrity endorsement worked for retail outlets and retail stores in general, with a focus on Europes leading chain, J. Sainsbury. Thus The focus of the study is on using celebrity endorsements for retail outlets. Its emphasis is on fit between celebrity image and brand image. Specific cases are analyzed to evaluate the extent to which consumers associate themselves with the image that the given celebrity projects and how that, in turn affects their purchase behavior Sainsburys started using Jamie Oliver (a high profile television chef) for their advertisement campaign, who served to promote the companys grocery products. He was chosen as he was seen as the best fit for their brand. The case itself identifies the criteria that made the endorsement successful by conducting questionnaires, interviews, and focus group studies. It outlines the key elements along with how they were used in the campaign to create a sense of confidence amongst the consumers and thus creating a successful campaign. The overall extent to which the consumers associate themselves with the celebrity and his words is dissected. Impact of celebrity Endorsement on overall brand Endorsements are seen to be on the rise entailing a valid question posed to consumers. Is there a science behind the choice of the endorsers or is it just by the popularity measurement? Which precise reasons lead to impact on brands by using celebrity endorsement? A thorough study of the paper streamlined a 14 point model which can be referred to as a blueprint criterion by brand managers for capitalizing on the celebrity resource through 360 degree brand communication and can also be used in selection of celebrities. The model was projected as the foundation brick on the impact of celebrity endorsement in paper. Our study revealed that 14 factors of the model and the effects of celebrity endorsement are proportional. Success of a brand is determined through celebrity endorsement which is accumulative of the following 14 attributes. If the below parameters score is higher, the chances of getting close to the desired impact are greater. The winner stories of celebrity endorsement are promotions which reflect a fine fit between the brand and the 360 degree advertising. And a decent example of one such story is of Fardeen Khan and Provogue. In the apparel market, Provogues positioning is of a young, active, party-going, attention-grabbing brand and so is Fardeen Khan. The union between the two has had a massive impact and brand managers have utilized this endorsement through 360 degree dimension as noted earlier. Moreover, the marketing/advertising firms should identify the symbolic properties of the sought after product first, as also proposed by the transfer model. Thereafter, consultation of host celebrities is appropriate to assure their similar traits with the product. Finally, after sorting out budget and availability constraints, the suitable celebrity has to be chosen as a representation of symbolic brand properties. The chosen celebrity will have some meanings associated with him/her which will not be suitable for the product. Consequently, only salient features excluding unwanted meanings should be captured and taken care of.Also, advertisements should also be structured in way to highlight the essential similarities between celebrity and the product. When it comes to subtlety, depth and power in delivering meanings celebrities are much nuanced compared to anonymous models. Celebrities also offer demographic information, configurations of range of personality and lifestyle meanings very thoroughly. Their persona evokes meanings with greater clarity. Furthermore, celebrities through repeated performance on public stage create their personalized meanings which can be passed into advertisements, through meaning transfer process. For instance Preity Zinta is perceived as a fun-loving, vivacious and modern Indian woman who can be translated into brand campaign with similar characteristics. In conclusion, the fit between celebrity traits and brand positions and its attributes determine the success. Celebrity endorsements Marketers need to be aware of the impact of using celebrities in commercials, promotions and print campaigns because it works if done properly. If business are about to make an effective advertisement, it must be attention-grabbing to its consumers and therefore most of them uses celebrities as endorsers. According to the article of Katyal S. (2008), celebrities serves the purpose of getting viewers attention; but proper choice of celebrity determines whether it translates into a sale and product image is delivered precisely. Selecting the right star to enhance the image of your product means finding the person to whom your consumers can relate to, meaning the person your consumer wants to believe in. Sometimes the selection of the right star for your product is not that daunting, until you realise that in many cases affordability is in question with the right celebrity. Essentially due to familiarity with stars, brands are normally endorsed by celebrities who make them enormously attractive to consumers. But anyone who thinks seriously about branding soon realises that there are basically two kinds of strong brands: those that are focused and those that are diversified. Significance of branding with celebrity endorsements is complicated to estimate in the present cluttered media industry and consumer markets. Electronic media branding including television will be of continuing interest and importance even with its idiosyncrasies in consumer payment and brand definition. There are three explanatory reasons for this; firstly a strong brand identity is crucial to producing audiences in a multichannel environment which is an environment that is becoming more and more crowded as television converts to digital delivery. Perhaps it is the only means of gaining a place in a viewers/ users channel repertoire. Secondly, brands are important for businesses to expand its markets. Extensions of brand marry an established brand to a new service as a means of establishing immediate market credibility. Besides that the third aspect explains, branding with the use of celebrities in which it is necessary to leverage corporate assets in order to open new markets. These markets may be related to the present business of a branded entity (e.g., ESPN Magazine, CBS Sportsline website), or if not separate they may be unrelated (e.g., logo apparel and other merchandise, Fox Sports restaurant/bars). With the traditional advertiser supported model of television under increasing pressure, television providers, and especially broadcasters, are constantly looking for new revenue streams to continue enhancing brand image and generate sales extensively. All in all, the power of an endorsement by a celebrity depends on the relevance of the celebrity to the product. For example, if Oprah was promoting a book about an issue particularly relevant to women then she is most likely to be effective. A famous chef can endorse a cook book or a famous fitness celebrity can certify an exercise book. If the buyer believes that the celebrity brings an unusual insight or twist, they would be more interested. In the case of skin whitening products, Lucida-ds and [Met] Tathione should carefully assess their endorsers to avoid business campaign failure in terms wrong brand perceptions and ultimate sale drop. Therefore, it is important to consider the conformity of the product and the alignment of both celebrity and brand attribute to be a market winner. Chapter V: Research Study Design Research Objectives Objectives to be analysed should be crisp and clear in order to observe the effectiveness of the decision for celebrity endorsement. Apart from the economic interests of celebrity endorsements (e.g. rise in total revenue/market share), it involves several psychological objectives. Such as an increased knowledge of the brand name, a more clear representation of brand/product characteristics by consumers, enriched attitude towards the ad, towards the brand and lastly, increased purchase intentions. Celebrity endorsement attributes that increase consumer purchase intention Celebrity attributes that are of most importance when analyzing effectiveness of endorsement Impact of celebrity attributes on brand positioning Effects of multiple celebrity endorsement on brand image Effects of celebrity endorsement on brand equity Factors that affect the consumers willingness to purchase a product or service when endorsed by a celebrity? Research Question: What celebrity attributes affect purchase behavior of Lowe Raufs clients? Hypothesis Celebrity endorsement has a significant / insignificant impact on consumer purchase behavior H0= Celebrity endorsement does not have a significant impact on consumer purchase behavior H1= Celebrity endorsement has a significant impact on consumer purchase behavior. Theoretical Framework The theoretical framework has been designed based on the literature review on studies based on this topic. It has been identified through these studies that the following variables combine to form the essence of celebrity endorsement and together, they affect purchase intention. [Source: Chabo Dimed et. al (2005). Celebrity endorsement-Hidden factors to success, Journal of Advertising pp. 298-301] Relevant Variables Variable Article Constitutive definition Operational Definition Attractiveness (Independent) Celebrity endorsements- Hidden factors to success The likeability of the celebrity associated with a product or service with regard to the glamour of the celebrity. Q 17, 18, 19, 20 21 Purchase Intention (Dependent) Impact of Celebrity Endorsement on Consumer Buying Behavior and Brand Building The ways in which a consumer interacts in accordance with the advertisement strategies run by a company for its product or service. Q12, 13 15 Brand celebrity Fit (Independent) Impact of celebrity endorsements on brands It explains how closely the personality and image of the celebrity matches the positioning of brand. Q 26, 27 ,28 29 Brand Recall (Independent) Advertisement and Promotion It explains how the consumer recognizes the brand with the celebrity who endorses the product or service. Q7, 8, 9, 10 11 Likeability (Independent) Impact of celebrity advertisement on customers brand perception It explains how the charm or glamour of the celebrity affects the sales of the brand. Q 24 25 Trustworthiness (Independent) Celebrity endorsements- Hidden factors to success The celebritys history with the consumers develops a level of trust between the two parties and this is what trustworthiness explains here. Q 22 23 [Source: Chabo Dimed et. al (2005). Celebrity endorsement-Hidden factors to success, Journal of Advertising pp. 298-301] Research Methodology This section outlines and elaborates on the research and how it was conducted. It covers the details of the research design, methodology for collecting the data, population, questionnaire development and data analysis. The aim of the paper is to figure out how celebrity or endorsements affect brands. The basic idea is to equip ourselves with additional research on the phenomenon of consumer response with respect to celebrity endorsed brands; this makes the research a basic research. Since the objective is to find how celebrity endorsements affect brands, this research is termed causal in nature. Data Type The bulk of this study revolves around quantitative data due to the fact that there is greater chance of bias in qualitative data as well as the fact that that numeric data is easier to analyze and understand. Data may be clearly measured and hence this serves as the major portion of the analysis. Quantitative data has been obtained through questionnaires, filled up by employees of Lowe Rauf as well as the final consumers so that both perspectives are covered. Qualitative data is in the form of interviews, two of which are conducted; one with the GM of the Lahore division and another, a joint interview with the account managers of Nestle and Mitchells. Population The study is based on understanding how consumers purchase intention is affected in the wake of celebrity endorsement. Since the study is limited to Lahore, the overall population sample would be equal users in Lahore, which equates to 4,695,600 (based on local census). Sampling Procedure Convenience, non-probability sampling is used for the questionnaire, based on the ease of access and availability of resources for the researcher. The final sample for the questionnaire consists of 30 users (16 male, 14 female) with varying ages, income brackets and occupations. For the interview, as stated, Anwar Kabir (GM Lahore branch) and the two account managers (Haris Habib and Zakria Fawad) are interviewed, based on convenience as well as relevant experience, working within the industry and actually hiring celebrities. Sampling Frame For the purpose of this research, the list of elements upon which the sample is selected from the population includes the fact that they should be easily accessible to the researcher (as convenience sampling is used). The other element of is that at least 50% of the sample should fall into the SEC B income bracket. This is because research shows this class to be the most frequent users of these products. For the interview, the major element (apart from convenience) is that the persons should be experienced in terms of the celebrity endorsement process and must have actually worked on campaigns to select celebrities based on different factors. Data Collection Procedure This research is based on the primary data collection approach. Questionnaires are used for collecting data. Personally administered questionnaires have been used. They were distributed to a total of 30 people of different ages, occupation and income; requiring them to fill a total of 30 questions each. Once the questionnaires were filled they were collected. The anonymity and confidentiality of the respondents and their responses has been ensured and data was analyzed at an aggregate level only. Close ended questions are used in the questionnaire which helps the respondents to make quick decisions to choose among the several alternative before them (Sekaran, 2000). The nature of the questionnaire has also helped the researcher to code the information easily for subsequent analysis. Likert-style rating scale was used; it consists of subsequent options: strongly agree, agree, neutral, disagree, and strongly disagree. Different statements were made in the questions and respondents were asked the degree as to what they agree or disagree upon. Questionnaire Development The questionnaire itself was kept simple and basic to ensure clarity and reduce bias. The purpose was to gather data from the selected population sample with regards to the topic. The questionnaire consisted of two parts, the first section contained six questions seeking information about the respondents age, gender, income, marital status, education and occupation. The second section contained questions that were based on information regarding the variables identified in the first chapter, this section itself consisting of five sub-sections; brand recognition and recall, purchase intention, endorser credibility and trustworthiness, endorser attractiveness likeability and image fit. The information attained would be used to analyze the findings and further the study. [Questionnaire attached in Appendix 1] Respondent Profile Data collection from the questionnaires shows that the respondent is a single 18-28 year male student with an income of 30,000-40,000. The other type of respondent is an 18-28 year old housewife with kids and income of 30,000-40,000. [Graphical representations of respondent demographics in Appendix 2] Data Analysis Procedure Once all the data is compiled, it is transferred to SPSS. This is done to understand how purchase intention is affected by the variables outlined in the theoretical framework. Values in the questionnaire are changed to numeric form so that data is quantified. Questions with the Likert-scale rating are given numeric forms, with 1 representing strongly disagree to 5 representing strongly agree. Using this method, the data is input into the software and a regression model is created, along with descriptive statistics and frequency tables. Chapter VI: Results Findings Interview Findings There were two interviews conducted within the Lowe Rauf agency, the first was with the general manager, Anwar Kabir and the second was with Zakria Fawad, the account service maanger. The interviews revealed that it is necessary to prioritize the needs of the firm as well as the agency in light of the budget allotted to the advertisement itself and the portion of the budget available to hire a spokesperson. Since the ideal spokesperson may not be within budget or may not be available due to other reasons, it is imperative that the importance of the key celebrity endorsers attributes be ranked and measured in terms of the impact on purchase intention of the relevant consumer. There were five key attributes that were thought to be important by the Lowe Rauf management, which were: attractiveness, likability, brand fit, trust worthiness and recognition. The order of their importance however is very subjective and it is believed that a more objective means to rank these and other relevant variables, would serve to make better and more informed judgments as to the importance of each variable as per the needs of the client. Hence it becomes important to conduct a regression analysis and quantify the impact of each variable on the purchase intention of consumers within the target customer category. Purchase intention = 0.0461095 + 0.353232* brand recognition and recall + 0.351173* trustworthiness + 0.133718* attractiveness 0.0495677* image fit + 0.21128* likeability The model tested has a coefficient of determina

To Create a Better World :: College Admissions Essays

To Create a Better World    When you work for peace or any other aspect of social change, there are often hardships to overcome. You must believe deeply that what you are doing is right, or else you may become discouraged and give up. I have found that there are no easy solutions to problems involving social change. When you commit yourself to creating a better world, you are most likely committing yourself to a lifetime of effort.    To succeed, you must be willing to persevere in your efforts and you must keep a positive, hopeful attitude. In this work, it is often unclear who you are reaching or whether change is occurring. Thus, you must trust that your work for a better world matters. Sometimes change is occurring under the surface as a result of many individual actions, and suddenly the results become clear as in the cases of the fall of the Berlin Wall, the break-up of the former Soviet Union and the end of apartheid in South Africa.    The most rewarding life is one in which there is a major element of serving others. Many people find a way to do this in their lives. Of course, there are many ways in which an individual can be of service to others. Some of the biggest problems at the global level, though, go largely unaddressed by most of us, and I think this is an area where young people can make important contributions.    We have many global problems, but we are lacking global institutions powerful enough to effectively address such problems as global terrorism, human rights abuses, global warming, the ozone layer, pollution of the oceans and rivers, arms trade, child soldiers, war, the weaponization of space, and nuclear and other weapons of mass destruction. Finding a way to participate in solving these and other global problems is one of the great challenges of our time.    Global problems require global solutions. They also require World Citizens who identify with and give their loyalty to humanity and the web of life. Patriotism takes on new dimensions and becomes Humatriotism, loyalty to humankind. To change the world requires a new kind of thinking and new loyalties that transcend the nation-state. These viewpoints may put one at odds with some segments of society, but if some individuals do not have the vision and the courage to venture beyond the borders of conformity then change will never occur.

Torstar Case Report

Group-based case report Torstar Corporation BUSN81 Theory of Corporate Finance 2011 Autumn 1. Introduction The case of Torstar Corporation suggests the plan and result of repurchasing its Class B shares in December of 1997. Besides this, the situation of its business structure, capital structure and expenditures, future plan are also described in the case. Therefore, the purpose of our case study is to state, analyze and drew to some important conclusions about Torstar Corporation, and try to estimate its power to compete with a new national newspaper. . Background Torstar Corporation was incorporated on February 6, 1958 and published Canada’s largest newspaper Toronto Star. It had two main rivals which are Sun Media Corp. and the Globe and Mail. One launching second national newspaper by Southam Inc. would also be one competitor of The Star. Since 1975, by acquisition of domestic and international book publishing and supplementary educational products, Torstar found its three major business, newspapers, book publishing and supplementary education. After the acquisition of Troll in fiscal 1997, it also has one 3-year-time plan to acquire more companies which fit with its core business at the reasonable price. As of March 31, 1998, Torstar share structure included 5 million Class A voting shares and 34 million Class B non-voting shares. Since they believed prevailing Class B stocks were undervalued, they began to repurchase it back from December 17, 1997. In 1997 the debt-to-total-asset ratio was 18%, and management believed that 30% was more appropriate. Actually they also suppose that they could carry a 50% debt-to-total-asset ratio if they had a suitable strategic acquisition. Therefore, based on this background, we will analysis the effects of repurchasing stocks of Torstar, the advantages and disadvantages of its leverage ratio and its ways to investment. Then by adding some assumptions, one prediction of Torstar’s power to compete with new launching rival is possible. 3. Analysis 4. 1 Overview of Cash Flow, debt, Operating Situation and Income The company was doing well so far, until 1997. The cash flow, operating situation and the income were all healthy. We can conclude that from the Balance-Sheet the company had adequate cash  flow, exhibit 3 shows that the operating cash flow kept increasing from 1995 to 1997 with the free cash flow, this was enough cash for Torstar facing with some possible risky. The only problem is that how to stop the continued increasing free cash flow since too much cash means increasing costs of keeping cash and decreasing market value of cash. The amount about $50,000 would be a good expectation. The three main business of newspaper, book and supplementary education were operated well, they had sustainable increasing revenue and stable expenditure, so the profit was increasing positively after 1993 acquiring the business of supplementary education, especially in 1997, it got a rapid increasing of net income. See the return of equity below, it shows a well increasing on return of investors. (Base on Net Income over Total Equity) The debt ratio was a little bit low as our analysis, it had space to increase. But how? Increasing dividend payment or repurchase in the open market? We analyzed these two possible ways below. 3. 2 Dividend policy Torstar Corporation has a stable dividend policy recent years which was to pay out 30 to 35 percent of the previous year’s operating cash flows. Cash dividend was paid regular quarterly which was keeping $0. 26 per share in 1997. Dividend empirically decreased in the propensity of firms due to its benefits are not attractive than repurchase, but it is still important for management. Advantage of payout dividends * Dividends may appeal to investors who desire stable cash flow but do not want to incur transactions cost from periodically selling share of stocks * On behalf of stockholders, paying dividends can keep cash from investors * Dividends can be used to reduce agency cost of managerial discretion * Managers may increase dividends to signal optimism concerning future cash flow * Disadvantage of payout dividends * Dividends are double taxed * Dividends can reduce internal sources of financing. Dividends may force the firm to forgo positive NPV projects or to reply on costly external equity financing * Firms often view dividends as a commitment to their stockholders and quite hesitant to reduce an existing dividends. Once established, dividend cuts would adversely affect the firm’s stock price as a negative signal As illustrated by Torstar, a stable cash flow in paying dividends implied a well operating status. The sale of Hebdo provided additional financial flexibility in 1997, free cash flow increased rapidly as can be seen in Appendix. An extra or special cash dividend and share repurchase are two choices to payout adequate cash. Special dividend is expressly not intended to be a recurring event, but as mentioned above, paying dividends with the tax drawback and may produce a negative signal when fluctuating. So keeping the stable payout ratio was a better choice for Torstar. 3. 3 Repurchase Compared with dividend payout, shares repurchase have the listed effects on Torstar Corp, * Send a costly signal to investors that stock of Torstar is a good investment. Recent investments seem to cause side-effect on investor’s confidence about the company. As mentioned in the article, institutional investors treat Torstar as a ‘pure play’ investment into the area of newspaper and book publisher. But from year 1995 to 1997, acquisitions into children’s supplementary education products are viewed as not favorable. They hope Torstar Corporation can continue the historical expansion of the newspaper and book division. In order to mitigate the side-effect caused by recent investment. Repurchase would result in fewer shares outstanding and thus higher equity value per share which leads to a better performance of the stock. It also sends a signal to the market that the management believes the stock is undervalued. The price of the stock would go up. As a result of the repurchase sends a strong signal to the investors. The signal is costly as a repurchase would use up corporate cash and hard to mimic. * Increase the EPS which shows great confidence of future performance Repurchase would decrease the number of shares outstanding which leads to directly change of EPS of the Torstar Corporation. In the interim financial statements, the EPS shows great improvements after the repurchase. (Show in Figure 1) Figure 1 EPS change in 1997 * Availability of excess cash from operations By checking the interim financial statements, cash provided by operating activities of Torstar Corporation face an increase in the year 1997, from 25. 6 million to 130 million dollars. The retained cash from operation activities is too much as the normal on-going capital expenditures was expected to be 25 million to 30 million dollars. Additionally, Capital cycle in the publishing industry is approximately six years and Torstar Corporation has recently modernized its plant. There’s no major capital expenditures were forecast for the near future. Thus, excess cash should be paid out. By checking the retained cash in the Quarter 1, 2008, the operating cash is 27. 97 million dollar. It is sufficient for on-going capital expenditure. (shown in figure 2) Reduction in excess cash would reduce the agency cost of managerial discretion as the manager has fewer resources to pursuing consuming perks. Figure 2 Cash provided by operating activities Compared with the dividends payout, repurchase is tax efficient as dividends is taxable. Compared with dividends payout, repurchase avoid price drop results from dividend issuance. Institutional investors are happy when the performance of the stock is good. High price shows the strong performance of the stock. * Optimize capital structure. Torstar’s long-term debt outstanding was reduced from 321 million in 1996 to 197 million in 1997 result in a debt-to-total assets ratio of percent. While the management believed that a 30 percent target debt-to-assets ratio was more appropriate. Too less debt may cause the loss of tax shield and influence the value of the firm. While at this level of debt-to-assets ratio, the risk is still acceptable. Torstar Corporation still has excess debt capacity for future capital expansion. Thus repurchase can decrease the shares outstanding, and also decrease the value of assets. It would push up the debt-to-assets ratio to the appropriate level. By using the interim financial statements, we get the trend of debt-to-assets ratio. In December 31 1997, the decrease of debt-to-assets ratio is mainly a result of the long-term debt decreasing from 510. 007 million to 197. 322 million dollars. And in March 31 1998, the increase in debt-to-assets ratio is a result of repurchasing shares (decreasing in value of total assets). 4. Conclusion After analyzing, we all agree with the activity the Torstar hold, stock repurchasing transfer a strong and credible signaling to the market that the company is in a good situation and will do better in the future, the debt ratio increases and the market value will also goes up. We estimate that Torstar will keep increasing in the next financial year. 5. Appendix Cash Flow Analysis (CDN$000) | 1995| 1996| 1997| operating cash flow| 78. 3| 102. 9| 130. 0| dividends| 30. 9| 35. 1| 40. 3| Capital expenses| 20. 3| 29. 8| 26. 6| free cash flow| 27. 2| 38. 0| 63. 1| Dividends | 1st Q 1997| 2nd Q 1997| 3rd Q 1997| 4th Q 1997| Dividends($000)| 10120| 9965| 10080| 10095| Average shares| 39151| 39107| 39060| 39044| Dividends per share| $0. 26| $0. 26| $0. 26| $0. 26|

Packet Switching and Fibre Optics in Modern Communication and Data Storage

Packet Switching and Fibre Optics in Modern Communication and Data Storage Future vision of data communication in fibre Fibre optics has continued to provide a flexible technology that enables the transfer of large amounts of data across long distances at very high bandwidths.Advertising We will write a custom research paper sample on Packet Switching and Fibre Optics in Modern Communication and Data Storage specifically for you for only $16.05 $11/page Learn More Optical fibre technology has been tried and tested in transoceanic communication and offers gigabit communication bandwidths which enable high speed data transfer. This helps to speed up communication and access to internet services across the world at affordable prices. Advancing to the use of fibre optics in data communication will provide a platform suitable for up to 2.5Gbit/sec of data transfer. Such a platform is expected to support various architectures of communication with examples being layouts such as ring, star, bus and tree configurations. Most of these layou ts are advantageous since they have higher fault tolerance than those that are in use currently. This therefore means that they will be more effective in terms of transmitting huge amounts of data. Optical fibre will therefore offer a secure data communication channel since it is not possible to tamper with them without detection. This is due to the fact that the power loss that occurs due to tampering cannot go unnoticed (Agrawal, 2002). It has been suggested by many communication experts that optical fibre is very expensive and fragile. It is however expected that the continued manufacture of optical fibre cables will lower the costs and therefore make fibre the cheaper option as compared to copper. Another major concern is the fragility associated with fibre. Any installation of fibre should be carried out by technicians who are knowledgeable about it in order to avoid losses due to breakages (Agrawal, 2002).Advertising Looking for research paper on other technology? Let' s see if we can help you! Get your first paper with 15% OFF Learn More Future analysis of packet switching Packet switching is another technology that is expected to have a great impact on the future of communication. In future, packet switching is expected to shape the storage of data due to the fact that the amount of digital data that need storage space today is increasing at a very fast rate and packet switching will offer the solution needed. The recent past has seen an incredible increase in the demand for capacity for the storage of data as a result of increased use of the internet and other related services. It is therefore necessary for data transport networks to evolve in order to meet these needs. Packet switching therefore will be used to provide an optical layer which can be reconfigured with optical cross-connects in order to realise a flexible core with a very high bandwidth capable of supporting the increased capacity. This means that this evolution a nd adoption of packet switching will offer the technology industry a circuit switched optical layer which will enable high capacity data storage and transfer as well as fast circuit provisioning (OMahony et al., 2002). The increasing multimedia traffic in terms of internet use has also led to the need for the development of packet switching. This is due to the fact that it will help ensure that network resources are used in an economical manner. Packet switching offers very high bandwidth efficiency and therefore plays an important role in making this possible. It has also been envisioned that in future, optical packet router can be used as an edge network device which will be designed to function as an interface to link the optical domain to the electronic ones.Advertising We will write a custom research paper sample on Packet Switching and Fibre Optics in Modern Communication and Data Storage specifically for you for only $16.05 $11/page Learn More This i s expected to provide flexibility and efficiency at a lower cost than when using electronic routers (OMahony et al., 2002). Conclusion The discussion above has shown that the future of communication and data storage and transfer are expected to change as a result of these two technologies. They will provide the high bandwidth and efficiency required to support the increasing need for internet services and data storage capacity. References Agrawal, G. P. (2002). Fiber-Optic Communication Systems. New York: John Wiley Sons. OMahony, M. J., Simeonidou, D., Hunter, D. K. Tzanakaki, A. (2002). The application of optical packet switching in future communication networks. Communications Magazine IEEE, 39(3), 128-135

Thank You After Interview Email

Thank You After Interview Email Despite the dour news reports, many companys are hiring! This article will help you write a thank you after interview email that helps you get the job. After a lengthy search process, two candidates qualified for the final interview with two vice-presidents for a lucrative sales position with an excellent company. After the interview, the vice-presidents were equally impressed with both candidates and unsure who to hire. Then, they received the candidate's thank you after interview email, and one was immediately hired and the other immediately excluded. Let's look at the thank you after interview email and examine what worked and what did not. (Note: The ideal candidate would demonstrate both a proven strong sales track record AND have the personality to build sincere business relationships with established company clients. Up until these emails were received, they appeared equally qualified.) HIRED From: ClaudiaLastName@youremailhost.com (Neutral, professional email address) Sent: Wednesday, July 16, 2011 10:09 PM To: Smith, Mike Subject: Thank you from Claudia LastNameDear Mike:Thank you for taking the time to meet with me today. I enjoyed our remote office venue! (Nice reminder of their meeting and her flexibility. The conference room they had booked for the interview was locked so the interview occurred in an airport restaurant.) I am proud of my 24 plus years of sales and management experience. I am a top sales performer eminently comfortable with all aspects of sales, and sales management. I am even more excited about this position after meeting with you and learning it requires diligent focus on relationship building. This is the area of sales I most enjoy and cultivate. When you speak with my references, I'm sure they'll attest to my genuine interest in learning about their businesses and our long-standing relationships. Susan Demers at Summit Team, who is on my reference list, and I worked together on a customized customer service project that is particularly similar. (This comment is great: targeted directly to the job requirement, with specific testimony to her ability, and includes a reference link). I excel in: ââ€" ª development of sales opportunities ââ€" ª building long-term customer relationships ââ€" ª high level computer literacy ââ€" ª attaining results (This long bullet list is a wordy and lacks specificity. All sales professionals should possess these characteristics so it doesn't add much but unnecessary length. Better would be to pick two or three traits that best match this job and demonstrate her suitability. For example, since relationship building is so important, bullet three specific examples which demonstrate this.) Again, thank you for the opportunity to meet with you and Matt. It would be an honor to be considered and hopefully become a part of the COMPANY NAME team to assist schools to manage the financial aspects of their education mission most efficiently. (Great close - she demonstrated she understands the company mission and where she fits in.) Kindest Regards, (Appropriate closing salutation.)Claudia LAST NAME †¨(555) 555-5555 Business Email WritingThis is a great example of matching content and tone to her readers, the two hiring vice-presidents. She engaged and convinced them because all content addressed their focus and issues, not hers. And, this writing skill earned her a great position. NOT HIRED From: seektheburn@youremailhost.com (If you have an unusual personal email address that reflects a personal interest, create a more neutral email account for your job search. Let's hope this address reflects an exercise enthusiast rather than a proclivity towards pyromania.) Sent: Wednesday, July 16, 2011 3:41 PM To: Smith, Mike†¨Subject: Meeting (Vague subject line) Mike, (Business email salutations for more formal email communication should use a colon, following business letter format. Personal messages and very informal email business communication use a comma. Also, there should be an appropriate professional business salutation included: "Dear Mike:" is best.) Thanks for meeting with me today. You guys make a great pair. ("You guys" is much too familiar and slang for business communication between people who have only met once, particularly in a job search. These "guys" were two company vice-presidents who had the final hiring decision.) I definitely appreciate the gentle banter. (About what? It seems the writer is trying to make a connection, but it falls far short. How does this statement convince his readers, the hiring vice-presidents, why he will best fill in their position?) I am excited about the possibility of coming aboard. I am confident that I can make a positive contribution to help grow the business. My experience speaks for itself. (Really? Unless the only job requirement is confidence, there is no other relevant content introduced here that demonstrates job suitability. Since this position is equally about sales and fostering relationships with clients, understanding their business needs by listening well, and problem solving, it was this paragraph that cost him the job. The vice-presidents felt he was too self-focused, and even too arrogant, for the position. They needed a highly skilled sales professional which implicitly requires competitiveness, hustle and focus, and he met that requirement. But, they also needed someone who listened to clients, and this paragraph made them think he lacked that skill. One vice-president commented, "If he can't write a thank you email without alienating us, what will he do to a client sales proposal?") To Good Tidings! (Avoid trite, meaningless closings. How does good tidings relate to this situation?)Steve (A job thank you message requires a closing salutation, such as "Best regards," not just a name.) The overall tone and content of this email was fully writer focused. All business communication should be reader focused. In this case, the message needed to include content and tone that would resonate to the two vice-presidents who interviewed him. It needed to convince them he would be the best person for their particular job. Instead, it was all about him and his perspectives.His lack of reader focus cost him a lucrative job he really wanted. Business Email writing is a requisite skill. Invest in your career growth in this Email Course.

The Universal Freckle, or How I Learned to Be White by Dalton (on Assignment

The Universal Freckle, or How I Learned to Be White by Dalton (on e-Reserve) - Assignment Example Certainly, everybody of us enjoys a privilege of one sort or the other in our lives. I, for example, have privileges over my servants, who then have many privileges over those living below in the poverty line. Likewise a woman in an Eastern society is more likely to enjoy privileges over their male counterparts since their men maintain a deeper reverence for the female genre altogether. Thus yes, I have been observing privileges around me all the time. Yes, ‘White Privilege’ is a term used to identify the advantages the white skinned people enjoy over darker one – in other words: Racism. Throughout the article the writer tries to undo the knots that hold racism and ethnicity together; something which has been validated by the UN convention that â€Å"there is no distinction between the terms racial discrimination and ethnic discrimination†. Though the world today is more evolved and mere colors do not define the privileges we enjoy today, but nonetheless the concept of racism has had a huge impact on the social structure of our society. Since every American stands equal today – as guaranteed by the constitution – the concepts of black and white had been pushed to a corner and we hardly find examples of racial discrimination today. The most contradictory products of racial discrimination came in the form of the teachers the writer had at school. At one school an African American teacher dare not cross the line and hit a white child drawing a clear border between the blacks and the non-blacks; while at another a Chinese teacher uses more productive measures and tries her best to blend the class into an equal force. Racial discrimination has always remained a heated debated and a serious problem of our society. Taking into account the writer’s experience with the German woman-shopkeeper, we all should rather pave our way towards unity and stand as one equal force. Divisions and