Risk management and international finance Assignment

Hazard the board and global money - Assignment Example The principle points of interest of these strategies including change is that they permit singular guaging on the default chance conditions that an organization might be oppressed particularly as far as credit and full scale factors (Apel and Jansson, 1999; Pg. 381). The investigation will likewise be fundamental in deciding the portfolio credit danger of the chose organizations after some time. Moreover, the methodology and formulae to be applied will be crucial in evaluating the degree through which new accords might be applied to towards accomplishing expanded credit hazard affectability inside a negligible capital charge (Ganguin and Bilardello, 2005; Pg. 186). At last, the examination will be fundamental in looking at the present capital necessity of banks under the proposed Basel framework along these lines contrasting the basic arrangement and the reasonableness or appropriateness of the equivalent to the Marylebone Bank. Banks are normally essential in driving economy particularly because of their sparing jobs just as giving capital and credit offices. Regardless, other than government guideline and oversight, the store capitals as a rule require a cutoff dangers for the contributors. These constrained dangers will guarantee that methodical and bankruptcy dangers are diminished. Furthermore, these guidelines and measures are essential in giving limitations on the working and activity of banks (Morris and Morris, 2005; Pg. 79). Consequently, their fundamental perspectives are to control superfluous capital prerequisites by controlling credit arrangement on unnecessary circumstance or loan bosses. In addition, similar guidelines and arrangements control the degree of capital where lacking capitals are disheartened since they may lead the bank into unwanted precise hazard levels. The Basel Capital accord was received in the year 1988 since which in had a global system and acknowledgment that applies until today. A gathering of national banks among other national administrative specialists started the understanding.

Fiasco Report - WorldCom - Free Essay Example

Fiasco Report WorldCom The team members do not have any relationship with WorldCom Overview of WorldCom (WC) WC started its journey as a small company known as Long Distance Discount Services (à ¢Ã¢â€š ¬Ã…“LDDSà ¢Ã¢â€š ¬Ã‚ ) in 1983, based in Clinton, Mississippi. In 1985 LDDS selected Bernard Ebbers, one of the major investors of the company, to be its CEO. The company went public as a corporation in 1989 after merging with Advantage Companies Inc. The company name was changed to LDDS WorldCom in 1995 and MCI WorldCom in 1998. During the 1990s, the firm acquired a number of telecommunications firms that helped it to grow from $154 million in 1990 to $39.2 billion in 2001, placing it 42nd among Fortune 500 companies[i]. Significant acquisitions included the 1998 takeover of MCI, which made it the second largest U.S. long distance carrier, and the purchases of UUNet, CompuServe, and America Onlineà ¢Ã¢â€š ¬Ã¢â€ž ¢s data network, which put WC among the leading operators of Internet infrastructure. In 2001 the company had an employee base of 85,000 workers with a presence in more than 70 countries. From the outside, WC appeared to be a strong leader of growth. In reality, the appearance was nothing more than a perception. On June 25, 2002, the company revealed that it had been involved in fraudulent reporting of its numbers by stating a $3 billion profit when in fact it was a half-a-billion dollar loss. After an investigation w as conducted, a total of $11 billion in misstatements was revealed[ii]. As a result investors in WC have suffered major losses: the market value of the companyà ¢Ã¢â€š ¬Ã¢â€ž ¢s common stock plunged from about $150 billion in January 2000 to less than $150 million as of July 1, 2002[iii]. WorldComà ¢Ã¢â€š ¬Ã¢â€ž ¢s Product Market Focus Initially, it was a provider of long distance phone services to businesses and residents. Later the company diversified its business to internet service and solution, Data and IP Services, IT Solutions and Hosting, Networks management, Premises Equipment (PE), Security, Voice, VoIP, and Wireless network to reach a customer base of 20 million. However, increase in the number of services and the products are mainly attributed to the new acquisitions and mergers with new companies. During the pick of the business, WC provided mission-critical communications services for thousands of businesses around the world, owned and operated a global IP (In ternet Protocol) backbone that provided connectivity in more than 2,600 cities and in more than 100 countries. In 2001 it carried a significant amount of the worlds Internet traffic, specifically 50% of total worldwide e-mails and 50% of US Internet traffic. It also owned and operated 75 data centers on five different continents. Merger and Strategy was the key for WorldCom growth strategy Throughout its journey since the inception WC choose merger and acquisition strategy for its growth. The company evolved into the second largest long distance telephone company in the United States and one of the largest companies handling worldwide Internet data traffic through the successful completion of 65 acquisitions. [iv] Between 1991 and 1997, WC spent almost $60 billion in the acquisition of many of these companies and accumulated $41 billion in debt[v]. Two of these acquisitions were particularly significant. The MFS Communications acquisition enabled WC to obtain UUNet, a major su pplier of Internet services to business, and MCI Communications, thus providing them one of the largest providers of business and consumer telephone service. By 1997, WCs stock price grew from pennies per share to over $60 a share[vi]. During those days of the internet boom, WCà ¢Ã¢â€š ¬Ã¢â€ž ¢s strategy seemed to be perfect to everyone and investment banks, analysts and brokers recommended WC as a strong buyà ¢Ã¢â€š ¬Ã‚  to investors. The analystsà ¢Ã¢â€š ¬Ã¢â€ž ¢ recommendations, coupled with the continued rise of the stock market, made WC a very demanding and desirable stock to the investors. The top management explored this advantage (high stock price) to use WC stock as the vehicle to continue to purchase additional companies. The acquisition of MFS Communications and MCI Communications were, perhaps, the most significant in the long list of WC acquisitions. With the acquisition of MFS Communications and its UUNet unit, WC suddenly had an investment story to offer about the value of combining long distance, local service and data communications.[vii] In late 1997, WCà ¢Ã¢â€š ¬Ã¢â€ž ¢s offer of $35 billion for the acquisition of MCI was 1.8 times more than the nearest offer made by British Telecommunications Corporation ($19 billion). MCI took WCs deal making WC a truly significant global telecommunications company[viii]. Issues affecting WordComà ¢Ã¢â€š ¬Ã¢â€ž ¢s Growth Strategy WC growth strategy was solely focused on mergers and acquisitions, not product development, innovation and customer satisfaction. It engaged in nearly 70 merger and acquisition deals in less than five years but did not focus on integrating organizational culture, structure and appropriate management control mechanisms. As a result, it was observed that by the early 2000s, the revenue of the company was diminishing. Furthermore, it was facing an emerging problem in 1990s of oversupply in telecommunications as the industry rushed to build fibre optic networks and o ther infrastructure based on overly optimistic Internet growth projections. WC and other telecommunications firms had experienced reduced demand as the internet boom ended and the economy entered recession. Their revenues had fallen short of expectations, while debt taken on to finance mergers and infrastructure investment remained. In this circumstance, the desire to conceal the bad news on company earning from the stock market investors created a powerful incentive for the top management to engage in fraudulent accounting reporting[ix]. The Management Controls Failure Fraud began at WCà ¢Ã¢â€š ¬Ã¢â€ž ¢s corporate headquarters, in the late 1990à ¢Ã¢â€š ¬Ã¢â€ž ¢s[x]. Several employees were involved, including: Bernard Ebbers CEO, Scott Sullivan CFO, David Myers à ¢Ã¢â€š ¬Ã¢â‚¬Å" Senior VP Controller, Buford Yates, Director of General Accounting, Betty Vinson à ¢Ã¢â€š ¬Ã¢â‚¬Å" employee under Yates, and Troy Normand à ¢Ã¢â€š ¬Ã¢â‚¬Å" employee under Yates[xi]. WC paid various fees to use or lease facilities belonging to third parties. Normally, these fees were reported as an expense on the income statement, which were filed with the other financial statements on a quarterly and annual basis. The financial statements also included commentary and guidance from WCà ¢Ã¢â€š ¬Ã¢â€ž ¢s senior management regarding future earnings. Typically this guidance pointed toward continued positive growth in earnings. In July 2000, WCà ¢Ã¢â€š ¬Ã¢â€ž ¢s expenses as a percentage of total revenue had begun to increase above historic averages[xii]. The fees paid for leasing were the primary drivers of this increase. This resulted in a decline in the rate of growth of WCà ¢Ã¢â€š ¬Ã¢â€ž ¢s earnings. The risk of missing investor analystsà ¢Ã¢â€š ¬Ã¢â€ž ¢ forecasts had increased, and with that the possibility of stock declines also increased. By October 2000, Sullivan believed that expenses as a percentage of revenue were too high to meet analystsà ¢Ã¢â€š ¬Ã¢â€ž ¢ exp ectations, and that expenses were higher than previous guidance statements suggested they would be[xiii]. With Ebberà ¢Ã¢â€š ¬Ã¢â€ž ¢s approval, Sullivan instructed Myers, and those working under him to make entries in WCà ¢Ã¢â€š ¬Ã¢â€ž ¢s general ledger that credited (and therefore reduced) expenses, and debited reserve and capital accounts (increasing these accounts)[xiv]. This series of transactions had the effect of increasing net income. This activity continued until June 2002[xv]. During this time, WC did not disclose these transactions to their external auditing firm, Arthur Anderson. The transactions were also not reported in SEC filings[xvi]. The fraud committed at WC was uncovered by a team of internal auditors in 2002[xvii]. The discovery was brought forward to the internal audit committee and board of directors. Once the board knew, several executives at WC were either fired by the board, or resigned, and the SEC began their investigation. Research Plan Outline To efficiently and effectively conduct our research on WCà ¢Ã¢â€š ¬Ã¢â€ž ¢s corporate scandal, we split the research into two areas: The WCà ¢Ã¢â€š ¬Ã¢â€ž ¢s fiasco itself, and an academic understanding of the control systems in place (and the ones that were missing). The first stage of the research component involves becoming familiar with the WC scandal from archives of reputable newspapers and business magazines. Secondly, we will examine the allegations brought upon WC by the SEC. We will also seek peer-reviewed academic journals for more details and insights into the incident allowing us to conduct an analysis of the role management controls played in the fiasco. In order to best understand WCà ¢Ã¢â€š ¬Ã¢â€ž ¢s corporate scandal, we have to be familiar with well-known frameworks to analyze fraud, corporate governance, managerial controls, and compliance. As the purpose of this research is to seek for academic standard or frameworks in the above mentioned areas, we sh ould rely on information or publications from regulators, or generally accepted principals, such as US-GAAP. We may obtain information from academic, peer- reviewed journals. This research will be conducted concurrently with the studying of the WC fiasco as it does not require any sequence and therefore, can be conducted independently. End Notes [i] Lyke, Bob Jickling, Mark, WorldCom: The Accounting Scandal CRS Report for Congress,P-2, Updated August 29,2002 [ii] Ashraf, Javiriyah, The accounting fraud at WorldCom: The causes, the Characteristics, the consequences, and the lessons learned [iii] Ibid,p-2 [iv] Eichenwald, Kurt (2002). For WorldCom, Acquisitions Were Behind its Rise and Fall, New York Times (August 8), A-1 [v] Romero, Simon, Atlas, Rava D. (2002). WorldComs Collapse: The Overview. New York Times (July 22), A-1 [vi] Browning, E. S. (1997). Is the Praise for WorldCom Too Much? Wall Street Journal (October 8), p. C-24. [vii] Eichenwald, Op. cit., p. A-3 [viii] Ibid [ix] Lyke, Op Cit. P-2 [x] à ¢Ã¢â€š ¬Ã…“MCI Inc.à ¢Ã¢â€š ¬Ã‚  Wikipedia, The Free Encyclopedia. Wikimedia Foundation, Inc. 10 January 2014. Web. 2 February 2014. à ¢Ã¢â€š ¬Ã‹Å"https://en.wikipedia.org/wiki/MCI_Inc.à ¢Ã¢â€š ¬Ã‚  [xi] à ¢Ã¢â€š ¬Ã…“Sullivanà ¢Ã¢â€š ¬Ã‚  United States Department of Justice, Office of Public Affairs. 2 March 2004. Web. 2 February 2014. https://www.justice.gov/opa/sullivan.pdf [xii] à ¢Ã¢â€š ¬Ã…“WorldCom Scandal: A Look Back at One of the Biggest Corporate Scandals in U.S. Historyà ¢Ã¢â€š ¬Ã‚  Yahoo Voices. Yahoo Incorporated. 8 March 2007. Web. 2 February 2014. https://voices.yahoo.com/worldcom-scandal-look-back-one-biggest-225686.html [xiii] à ¢Ã¢â€š ¬Ã…“Sullivanà ¢Ã¢â€š ¬Ã‚  United States Department of Justice, Office of Public Affairs. 2 March 2004. Web. 2 February 2014. https://www.justice.gov/opa/sullivan.pdf [xiv] à ¢Ã¢â€š ¬Ã…“Worldcomà ¢Ã¢â€š ¬Ã¢â€ž ¢s ex-boss gets 25 yearsà ¢Ã¢â€š ¬Ã‚  BBC News. 13 July 2005. Web. 2 February 2014. https://news.bbc.co.uk/2/hi/business/4680221.stm [xv] à ¢Ã¢â€š ¬Ã…“Prepared Remarks of Attorney General John Ashcroftà ¢Ã¢â€š ¬Ã‚  Attorney Generalà ¢Ã¢â€š ¬Ã¢â€ž ¢s Office 2 March 2004. Web. 2 February 2014. https://www.justice.gov/archive/ag/speeches/2004/030204agweb.htm [xvi] à ¢Ã¢â€š ¬Ã…“Sullivanà ¢Ã¢â€š ¬Ã‚  United States Department of Justice, Office of Public Affairs. 2 March 2004. Web. 2 February 2014. https://www.justice.gov/opa/sullivan.pdf [xvii] à ¢Ã¢â€š ¬Ã…“MCI Inc.à ¢Ã¢â€š ¬Ã‚  Wikipedia, The Free Encyclopedia. Wikimedia Foundation, Inc. 10 January 2014. Web. 2 February 2014. à ¢Ã¢â€š ¬Ã‹Å"https://en.wikipedia.org/wiki/MCI_Inc.à ¢Ã¢â€š ¬Ã‚ 

The First 30 Days of the George W. Bush Presidency

Setting priorities for his first term in 1933 was easy for President Franklin D. Roosevelt. He had to save America from economic ruin. He had to at least begin to pull us out of our Great Depression. He did it, and he did it during what has now become known as his First Hundred Days† in office. On his first day in office, March 4, 1933, FDR called Congress into a special session. He then proceeded to drive a series of bills through the legislative process that reformed the U.S. banking industry, saved American agriculture and allowed for industrial recovery. At the same time, FDR wielded the executive order in creating the Civilian Conservation Corps, the Public Works Administration, and the Tennessee Valley Authority. These projects put tens of thousands of Americans back to work building dams, bridges, highways and much needed public utility systems. By the time Congress adjourned the special session on June 16, 1933, Roosevelts agenda, the New Deal, was in place. America, though still staggering, was off the mat and back in the fight. Indeed, the successes of Roosevelt’s First 100 Days gave credence to the so-called â€Å"stewardship theory† of the presidency, which contends that the President of the United States has the right, if not the duty, to do whatever best addresses the needs of the American people, within the limits of the Constitution and the law. Not all of the New Deal worked and it took World War II to finally solidify the nations economy. Yet, to this day, Americans still grade the initial performance of all new presidents against Franklin D. Roosevelts First Hundred Days. During their first hundred days, all new Presidents of the United States try to harness the carryover energy of a successful campaign by at least starting to implement the main programs and promises coming from the primaries and debates. The So-Called Honeymoon Period During some part of their first hundred days, Congress,  the press, and some of the American people generally allow new presidents a honeymoon period, during which public criticism is held to a minimum. It is during this totally unofficial and typically fleeting grace period that new presidents often try to get bills through Congress that might face more opposition later in the term. The First Thirty-or-so of the First Hundred Days of George W. Bush Following his inauguration on January 20, 2001, President George W. Bush spent the first one-third of his First 100 Days by: Getting himself and his successors  a raise in presidential salary -- to $400,000 a year -- as approved by Congress in the closing days of its last session;Reinstating  the Mexico City policy denying US aid to countries that advocate abortion as a method of family planning;Introducing  a $1.6 trillion tax cutting program to Congress;Launching  a Faith-Based Initiative to help local charitable groups;Launching  a New Freedom Initiative to help disabled Americans;Filling out  his Cabinet including the controversial appointment of John Ashcroft as Attorney General;Welcoming a pistol firing visitor to the White House;Launching renewed air strikes against expanding Iraqi air defense systems.Taking  on big labor unions in government contracting; andFinding  out that an FBI agent may have spent years spying for Russia. So, while there were no depression-busting New Deals or industry-saving reforms, the first 30 days of the presidency of George W. Bush was far from uneventful. Of course, history will show that most of the rest of his 8 years in office would be dominated by dealing with the aftermath of the September 11, 2001 terror attack a mere 9 month after his inauguration.

Leadership Opportunities Of The Youth Association Pee Wee...

Leadership opportunities abound not only in the work setting, but in churches, communities, and neighborhoods as well. By taking on community leadership roles, individuals give back to the community and gain valuable experience that will serve them well in the workplace. In my own experience, I led the Chantilly Youth Association Pee Wee Soccer program for three years. In this capacity, I created schedules, reserved fields and gyms, ordered uniforms, arranged for the training of officials, collected money, and created teams for over 500 young children. I had a vision for the program and helped it grow. While Pee Wee Soccer is not rooted in a faith-filled tradition, faith-based leadership skills apply. Running such a large program affords the opportunity to teach as Jesus did, at least with respect to community and service, and gain valuable insight into organizational behavior. Perhaps the most essential lesson learned is that to be successful, it is important to consider the needs of everyone involved, and not merely the needs of a few. Catholic School Leadership The skills gained through Pee Wee Soccer prepared me well for the leadership roles I undertook in my early years as a Catholic school teacher. Whether in the role as Math Committee chairperson or as leader of the â€Å"Word Study† program, developing a vision, articulating that vision, and seeing it through to completion helped me gain support from my peers and colleagues as I took on more responsibility and further

Case Study for Starbucks Coffee Company @Myassignmenthelp.com

Question: Provide an elaborate background,Strengths, Weaknesses, Opportunities' and Threats about the Starbucks Coffee company? Answer Introduction: About the firm Starbucks is a Coffee company which is headquartered in the Seattle at Washington. The firm actually began in the year 1971 with merely single retail store in Seattle's historic Pike Place Market. Currently it is one of the leading brand as well as retailer throughout the world. Starbucks in reality went public in June 26, 1992 (Starbucks.com, 2015). The firm operating in Singapore has several stores and offers a variety of regular otherwise decaffeinated beverages of coffee, a very special "coffee of day," as well as a broad assortment of all Italian-style drinks of espresso. Additionally, customers get options to choose from varied items that are available of fresh-roasted as well as whole-bean products of coffees. The actual product mix of each store varies and, depends on size as well as location of every outlet (Snyder, 2006). Competitors: Several numbers of coffee shops are attainable in the regional Singapore dialects and even in the Chinese market. There are many both old as well as new are seen in the city and majority are actually scattered within the town as well as in local places (Bertelsen, 2012). There are also local coffee shops that exist as competitors for Starbucks as they serve coffee in fewer prices and Starbucks is an expensive brand which every common person cannot afford. Businesses of the firm face several challenges as well as struggle while they actually focus upon the international market; and also have faced several of all these challenges yet it has now been capable of succeeding greatly within the global market. The firm has even narrowed down all of its tactical imperatives of the ways in which it could expand internationally, know and analyze the global context as well as develop intercontinental strategies. Starbucks also has overcome all the organizational challenges like developing a worl dwide organization, and creating proper worldwide improvement as well as learning (Bohm, 2009). Strength: Strong and vital brand name as well as image- The standing and repute of the firms brand name as well as image of the Starbucks permits the brand recognition as well as consumer retention. Thus, expanding of the outlets to many other parts of the city is a talented and capable approach of the firm and has resulted in the rise of the firm (Cole, 2008). Healthy economic performance- financial performance of Starbucks has forever had a very positive impact on the firms strength. The earnings of the firm have helped the firm to attain better market share and has also supported in whatever expansions it has tried (Dealtry, 1992). Highly-skilled team in the management- Starbucks also has greatly skilled as well as professional CEOs, and has a very effective management team which supports the firm in taking effective and good decisions. These also lead to rapid plus stable growth and development of Starbucks (Durevall, n.d.). High technology- The firm brings technology into use in all its stores for extensively attracting extra customers. For example, there exist high-pace internet, website as well as prepaid cards for Starbucks. It may increase the traffic in stores generally in novel generation set. Good quality as well as innovative products- The firm utilizes high quality coffee beans as well as dairy goods. Also, forever the firm tries to develop something new and make customers feel more contended (Fine, 2009). Coffee also is extra of a opulence product thus it is also those people and places with most quantity of throwaway income towards spending which must be also targeted most intensely (Wurgaft, 2003). The firm would never like to locate towards any area where local populace has very poor attitude towards work. Thus Singapore is a very good market for the firm. People here are ready to spend a lot behind such products and also like to spend their leisure time in the outlets of the coffee shops. Recruitment might be difficult and training arduous, as well as staff turnover might be high in places where people are lazy (Ghoshray, 2010). Starbucks brand name has also allowed it to carry upper-hand as well as power towards leveraging in its discussions with many other firms. Starbucks even has utilized such alliances to support and then create innovative products which the firm might never have been capable to comprehend or justify even if it was to take them upon all alone (Finley, 1914). Weakness: High price- The firm has enhanced the price rate because of the rising cost and expense of the production, comprising of the cost of the dairy goods as well as cost of the rent. This increment in the price also has affected the firm and its sales have fallen and also the customer retention has become difficult (Halper, 2006). Clusters of the outlet- As Starbucks carries several stores as well as these are actually located in very closed areas; it also leads to scramble of the customers in every store. Such clusters of outlets might even cause incompetent performance of firm (Kuada, 2008). Opportunities: Large group of consumers- China has biggest population all over the world. Coffee drinking also is very popular amongst the young generation, particularly those who carry the overseas education that influences consumption of coffee. Several of the teenagers have actually lived in the western nations for a very long time also they are very familiar with coffee culture (Leake, 1982). While returning to their own nation they have also carried on the living within this fashion. Such teenagers also want to choose the western style of the coffee shops like their preferred place. Lifestyle- The people carrying modern lifestyle of the Chinese teenagers as well as adults hold up the propagation of the western types of the coffee shops (Mohammad Arabzad an, 2012). Meeting as well as discussing business within very warm plus nicely designed shops for coffee has become extra popular within China. As a result, teahouses dominion has also been confronted by foreign house for coffee. The income is actually distributed and this can be a factor the firm now needs to look at because this also shows ideal place towards aiming their marketing otherwise locating their outlets (Taylor, 2008). Threats: Competitors- Global market for coffee is extra competitive segment. Starbucks is also facing increase of the competitions from many other overseas players. The newest Starbucks competitor actually is Canadian chain named as Blenz Coffee that plans to unlock a cord of caf within China where customers can smoke because at the time of sitting within the store of Starbucks is people are not allowed to smoke (Pickton and Wright, 1998). Intellectual-property infringement- Starbucks has filed a proper lawsuit intended for the trademark infringement all against the Shanghai Xingbake that signs, logos as well as names same as the Starbucks. It would even seem that there are chances of people getting confused (Shermer, 2001). Starbucks must thoroughly investigate political constancy of the nations. Changes within the government could also lead to alterations in taxation as well as legislation. The most recent organizational challenge which a firm faces is all about trying to get engaged in the cross-border teamwork. Starbucks has taken great care while determining the firms that would partner with it when moving into any novel new market (Ratnasingam, 2006). Through such international alliances and joint ventures, as well as licensing Starbucks can also gain proper access to novel markets. The firm also likes to influence its increasingly brawny brand via varied alliances towards selling the Starbucks coffee as well as developing novel products along with Starbucks name (Rypkema, 1987). In a nutshell here are all details regarding the firm named Starbucks in Singapore and a proper analysis of the firms strengths, opportunities, weaknesses and threats. References Bertelsen, B. (2012). Everything you need to know about SWOT analysis. [Newmarket, Ont.]: BrainMass Inc. Bohm, A. (2009). The SWOT Analysis: GRIN Verlag. Cole, G. (2008). Grande Expectations: a Year in the Life of Starbucks' Stock20081Karen Blumenthal. Grande Expectations: a Year in the Life of Starbucks' Stock . Loughton: Piatkus 2007. Management Decision, 46(4), pp.673-675. Dealtry, T. (1992). Dynamic SWOT analysis. Birmingham (Prince's Corner, Harborne Park Road, Harborne, Birmingham. B17 0DE): Dynamic SWOT Associates. Durevall, D. (n.d.). Competition in the Swedish Coffee Market, 1978-2002. SSRN Journal. Fine, L. (2009). The SWOT analysis. [S.l.]: Kick It. Finley, G. (1914). TESTING MARKET VALUES IN COFFEE. School Science and Mathematics, 14(8), pp.718-719. Ghoshray, A. (2010). THE EXTENT OF THE WORLD COFFEE MARKET. Bulletin of Economic Research, 62(1), pp.97-107. Halper, A. (2006). Starbucks Wars: Chinese Courts Say No Hitch-Hiking Allowed. The China Quarterly, 188(01), p.1155. Kuada, J. (2008). International market analysis. Adonis and Abbey. Leake, A. (1982). Market analysis. London: Macmillan. Mohammad Arabzad an, S. (2012). Improving Project Management Process in Municipality Based on SWOT Analysis. International Journal of Engineering and Technology, 4(5), pp.607-612. Pickton, D. and Wright, S. (1998). What's swot in strategic analysis?. Strat. Change, 7(2), pp.101-109. Ratnasingam, P. (2006). SWOT analysis for B2C e-commerce. Hershey, PA: Idea Group Pub. Rypkema, D. (1987). Market analysis. Washington, D.C.: National Trust for Historic Preservation. Shermer, M. (2001). Starbucks in the Forbidden City. Sci Am, 285(1), pp.34-35. Snyder, M. (2006). State of the Profession: The Starbucks Effect. Academe, 92(1), p.70. Starbucks.com, (2015). Home. [online] Starbucks.com.sg. Available at: https://www.starbucks.com.sg/ [Accessed 3 Feb. 2015]. Taylor, S. (2008). Starbucks Spreads the Spirit of Giving with CARE. Advertising Society Review, 9(1). Wurgaft, B. (2003). Starbucks and Rootless Cosmopolitanism. Gastronomica, 3(4), pp.71-75.

The Influence of Emotions on Organizational Change

Introduction Acceptance of change within an organization depends on the emotional state of employees and managers. The behavior, feelings and attitudes of employees within an organization are influenced by their emotions (Zerbe 2008, p. 173). It is important to highlight the interpersonal effects of emotions in order to comprehend the exact influence of emotions within an organization.Advertising We will write a custom essay sample on The Influence of Emotions on Organizational Change specifically for you for only $16.05 $11/page Learn More The domains of organizational behavior are very essential in understanding the effect of emotions on the performance of employees (Zerbe 2008, p. 173). Organizational behavior domains such as leadership, group decision making and customer service require emotional intelligence from the parties involved. Emotional intelligence is a very valuable attribute that all stakeholders within an organization need to possess (Ze rbe 2008, p. 174). The success or failure of an organization actually depends on the level of emotional intelligence among its employees and managers. This paper will highlight the role of emotions in the management of organizational change. Discussion Many organizations have always underestimated the effect of emotions in the day activities of an organization (Weick 1999, p. 364). In fact, the topic of emotions never featured in the past until recently when managers realized that emotions actually play a significant role in the success of an organization (Weick 1999, p. 364). Many organizations are now taking the subject of emotions very seriously after discovering its significance. Organizations believed that emotions could only be expressed at home but they forgot that employees still remained human despite being at the workplace (Weick 1999, p. 364). The corporate world is now discovering that the positive emotions of employees should not be left at home because they are crucial to the success of an organization. A recent research indicates that the productivity and creativity of employees is affected in a great way by emotions (Weick 1999, p. 366). Emotional intelligence determines the career success of an employee compared to cognitive intelligence. Although cognitive intelligence is important for an employee, research reveals that a combination of both cognitive and emotional intelligence is crucial for employees to achieve their career goals (Weick 1999, p. 366). The management of organizations has come to realize that their success depends on their ability to utilize positive emotions of employees to their organizations’ advantage (Weick 1999, p. 367).Advertising Looking for essay on business economics? Let's see if we can help you! Get your first paper with 15% OFF Learn More Managers who have mastered the art of stimulating and sustaining positive emotions in their employees have actually been able to witness positive results ( Vince 1996, p. 17). The current market is very competitive and it is therefore necessary for organizations to come with strategies that can give them a competitive advantage. The primary sources of competitive advantage such as intellectual capital, customer service, organizational responsiveness and productivity are influenced directly by employee emotions (Vince 1996, p. 17). The creativity and knowledge of employees are very significant in the success of an organization since the modern economy is knowledge-based. Employees that are creative and knowledgeable are very receptive to organizational change compared to those who are not knowledgeable and creative (Vince 1996, p. 17). The ability of an organization to harness intellectual capital from its employees will enable it to survive in an innovation driven economy. The intellectual capital of employees should therefore be engaged and cultivated by management for the expected results to be achieved (Vince 1996, p. 18). The emoti onal state of employees determines the organization’s level of intellectual capital (Pfeffer 1981, p. 43). The intellectual functioning of employees within the organization is also affected directly by emotions. A smart and innovative workforce is a dream of many organizations and this can only be achieved through proper management of employee emotions (Pfeffer 1981, p. 43). The flexibility and originality an employee’s thinking is normally diminished by a negative emotional state. Flexibility in thinking is one of the key attributes needed in the implementation of organizational change (Pfeffer 1981, p. 43). It is the duty of management to ensure that employees remain in a positive state of mind to enhance originality and flexibility in their thinking. A dispirited workforce loses the interest to innovate and identify new opportunities (Pfeffer 1981, p. 43). Negative emotions make employees lose the energy and drive to be creative. A passionate, confident and secure w orkforce will always make wise decisions and at the same time create new solutions (Pfeffer 1981, p. 44).Advertising We will write a custom essay sample on The Influence of Emotions on Organizational Change specifically for you for only $16.05 $11/page Learn More Sharing of knowledge and expertise in the entire organization is very important in a knowledge driven economy (Neal 2004, p. 60). Employees in a negative emotional state are always unwilling to help and share information with others. Implementation of organizational change requires knowledge to be shared throughout the organization and if this does not happen, then organizational change implementation becomes difficult (Neal 2004, p. 60). The intellectual capital of an organization enables information to be disseminated freely. Organizations that have effective information dissemination systems experience a lot of success because implementation of organizational changes becomes much easier (Nea l 2004, p. 60). Employees who are insecure about losing their positions are normally reluctant to share knowledge with others. Employees who feel safe and valued show high levels of commitment and are always available to share their knowledge with others (Lyubomirsky, King Deiner 2005, p. 805). In order to maximize intellectual capital, management must ensure the emotional state of employees is turned from being negative to being positive. It is not possible to separate emotions from customer service because the two greatly affect each other (Lyubomirsky, King Deiner 2005, p. 805). Service workers who are demoralized and angry will definitely create a negative service climate. It is very difficult to offset a negative emotional state with training initiatives. It is the responsibility of management to ensure that service employees are motivated in order for them to deliver quality service to customers (Lyubomirsky, King Deiner 2005, p. 805). It is dangerous to have disgruntled se rvice employees because they are the ones who come in direct contact with customers (Keifer 2002, p. 44). Failure to address emotional needs of service employees has serious economic consequences since the organization is bound to lose its customers due to poor customer service. The leadership of any organization should ensure that this group of employees remains in a positive emotional state (Keifer 2002, p. 44).Advertising Looking for essay on business economics? Let's see if we can help you! Get your first paper with 15% OFF Learn More It is estimated that almost 68 % of customers defect from companies where the service staff treated them with an indifferent attitude. This defection figure exactly shows the amount of damage that negative emotions can to do to an organization (Keifer 2002, p. 45). The profitability of an organization is therefore dependant on the emotional state of service employees. The current market is always changing at a faster rate with organizational responsiveness being a major requirement for an organization’s sustainability (Hughes 2006, p. 52). Employees with positive emotions respond quickly to market changes. Threatened and dispirited employees will always resist change. Employees in a dispirited state will not be willing to adopt new methods and systems that are important in facilitating organizational change (Hughes 2006, p. 53). Employees who are stressed stick to outdated methods even if it is obvious that the methods and systems can not deliver the required results (Hughes 2006, p. 53). Employees with a peace of mind respond to market changes passionately. It is therefore true to say that the ability of an organization to respond to market changes and demands depends on the emotional state of its workforce (Hatfield, Cacioppo Rapson 1994, p. 28). Employee retention and attraction is another domain of organizational behavior that is influenced to a great extent by employee emotions (Hatfield, Cacioppo Rapson 1994, p. 28). Employees who are happy and motivated will always want to stay with the organization (Hartel 2006, p. 77). An organization that treats its employees well by taking care of their physical and emotional needs will always attract the best talents in the market. The productivity of employees will definitely rise if they are excited and proud of their workplace (Hartel 2006, p. 77). It is difficult for depressed employees to give out their maximum output. Organizations should provide the best working conditions for its employees in order to get the best out of them (Finlay 2000, p. 68). It takes a lot of effort and resources to motivate and satisfy a disgruntled workforce. The other advantage of having a happy and motivated workforce is the reduction in the turnover cost (Finlay 2000, p. 68). Employees who are happy will always save the organization from unnecessary costs (Finlay 2000, p. 68). A positive emotional state gives employees the energy to work hard because they will be happy with their work and the organization in general (Finlay 2000, p. 68). An atmosphere of positivity enhances positive results and success in an organization (Erick Yvonne 2008, p. 10). It is argued that a leader’s positive emotions are the most transferrable. The other way through which positive emotions can be enhanced in an organization is by creating chains of events that carry positive meanings for others (Burnes 2004, p. 113). Social and psychological experiments have shown that employees with positive emotions are more he lpful than those with neutral emotional states. Organizational field studies indicate that sales people who experience more positive emotions at work are more helpful to their customers (Burnes 2004, p. 113). The field research also revealed that sales people who exhibit positive emotions tend to attract more customers and in the process making a lot of sales. The reason for this argument is that sales people with positive emotions tend to be more creative, flexible and emphatic (Burnes 2004, p. 113). This argument shows that being helpful not only develops from having positive emotions but it also produces positive emotions in others. An individual who is helpful to others tends to have a feeling of joy and pride when he or she realizes that their positivity influence the people they interact with (Beer 2000, p. 66). Positive emotions enables a person to help others and at the same time fuel motivation that can help both presently and in the future (Beer 2000, p. 66). Witnessing an d hearing about helpful acts can make employees to experience positive emotions. Onlookers experience the positive emotion of elevation. The tendency sparked by elevation is a general desire to become a better person by performing helpful acts (Beer 2000, p. 66). Elevated employees do not simply mimic the helpful acts witnessed but creatively consider a wide range of helpful acts. The positive emotion of elevation gives employees the desire to be better for the sake of the organization (Barbara 1998). The employees who experience helpful acts tend to experience elevation and its beneficial repercussions. There is always a high probability that an employee who witnesses and experiences good deeds will definitely be influenced to start helping others (Barbara 1998). The elevation cycle can transform an organization into a more benevolent and coordinated place to be (Ashforth Humphrey 1995, p. 99). Positive emotions expand through organizations, members and customers. Positive emotion s produce meaningful relationships among employees and in the process preventing conflicts in the workplace (Ashforth Humphrey 1995, p. 99). Facial expressions and mimicry can not be seen as ways of determining whether a person has positive emotions or not. Positive emotions are developed from within and their expression should be sincere without any form of pretence (Ashforth Humphrey 1995, p. 99). The way an individual behaves in relation to positive emotions is understood and translated by the other individuals that they come cross (Alice 2008). The emotional state of managers plays a critical role in the success or failure of an organization. As mentioned earlier, leaders who display positive emotions have a great influence on the behavior and attitudes of other employees within the organization (Alice 2008). It is therefore true to say that positive emotions in an organization are linked to the managers. A manager with an attribute of positive emotions is able to transmit thi s trait to employees. The level of control and support towards employees is determined by this trait (Alice 2008). Positive emotions determine how employees deal with various situations within the organization. This development is highly dependant on the leadership traits or skills that managers within an organization possess (Alice 2008). Leadership is a process of symbolic management that involves creating and maintaining shared meanings among followers. The organization leadership should always evoke positive emotions in the workplace through the use of symbols (Finlay 2000, p. 69). Symbols are known to bring both interactive and emotional responses. Symbol elaboration by managers evokes emotions in an organization. Moreover, managers engage in communication of symbols that are specifically designed to make their employees feel better (Finlay 2000, p. 69). Employees are normally strengthened when they feel better about themselves. Resistance to change is a common thing in many or ganizations and it is the responsibility of managers to emphasize the importance of change as early as possible to prepare the employees psychologically for organizational change (Finlay 2000, p. 69). Managers give employees a sense of trust and understanding by preparing them psychologically for change. This approach enables employees adapt to change as quickly as possible and at the same time making them deal with situations more positively (Vince 1996, p. 20). It is important for managers to adopt the theory of positive emotions in order to influence organizational change. The behavior and attitudes of managers and employees has to change first before organizational change takes place (Vince 1996, p. 20). Managers should always be willing to influence positive emotions among employees because anything good or bad begins from the top (Vince 1996, p. 20). The emotions of managers can be transferred easily to employees and this actually determines how employees relate with one anoth er. The positive emotions of managers encourage creativity in the organization which subsequently improves the level of success in the organization (Vince 1996, p. 20). The emotions displayed by leaders are a critical determinant of their relationship with group members and their ability to communicate emotionally evocative symbols (Beer 2000, p. 66). Managers who are emotionally positive enhance organizational creativity performance by facilitating group cohesion. It is important for positive emotions to be built and sustained in the entire organization through a healthy emotional climate (Beer 2000, p. 66). Organizational policies and values are normally misinterpreted in the context of face to face interactions. Managers can identify cues of real and felt emotions among employees. The managers also have the ability to identify positive emotional indicators of employees who are motivated towards achieving personal and organizational goals (Beer 2000, p. 66). It is a difficult job for management to determine the emotional state of all employees at the same time (Keifer 2002, p. 60). Despite this difficulty, managers need to be aware of their organizational climate all the times. Negative feelings about change can only be improved if managers are aware of their organizational climate (Keifer 2002, p. 60). Negative feelings can have devastating effects on the performance of an organization. Leaders must have the ability to arouse motivation by appealing to human needs for achievement, affiliation and power (Keifer 2002, p. 60). A good organizational climate decreases the cost of turnover and the resistance of employees to change. A great organizational climate also improves the quality, creativity and acceptance of risks which make customers to be loyal (Neal 2004, p. 72). The mood and behavior of a leader within an organization have a great influence on the organization’s performance (Neal 2004, p. 72). There is a powerful chain reaction between a manag ers’ mood and behaviors which drive up the mood of everyone else within the organization (Neal 2004, p. 72). Managers with high emotional intelligence can create an environment where loyal, intelligent and positive minded employees strive towards achieving organizational goals (Neal 2004, p. 72). Conclusion The primary sources of competitive advantage are enhanced by employees with positive emotional states (Zerbe 2008, p. 175). It is also evident from the discussion in this paper that managers with positive emotions can influence the same in many areas of the organization (Zerbe 2008, p. 175). Employees that work in an organization with a positive climate work in persistent and strong groups where positive emotions are transferred from leaders to all the members within the group (Zerbe 2008, p. 175). Positive organizational behavior results in creativity, success and the ability of an organization to deal with emerging changes in the market (Hatch 2006, p. 40). Managers shou ld therefore pay more attention on the positive aspects of the organization and focus less on the negative aspects (Hatch 2006, p. 40). This enables employees to feel motivated and therefore leading to growth and development within the organization (Hatch 2006, p. 40). The ability of an organization to deal with the changes that occur in the market makes it more competitive. Bibliography Alice, B 2008, Positivity by Barbara Fredrickson. Web. Ashforth, B. E. Humphrey, R 1995, Emotion in the workplace: A reappraisal. Human  Relations, Vol. 48, pp. 97-125. Barbara L 1998, Positive emotions and upward spirals in organizations. Web. Beer, M 2000, Breaking the code of change, Harvard Business Press, London. Burnes, B 2004, Managing change, Pearson Education UK, London. Eric F. Yvonne R 2008, Leading strategic change, Bridging Theory and Practice, Vol. 1, no.1, pp. 9-10. Finlay, P 2000, Strategic management, Prentice Hall, London. Hartel, C 2006, Emotions in organizational behavior, Ro utledge, New York, NY. Hatfield, E., Cacioppo, J., Rapson, R l994, Emotional contagion, Cambridge University Press, New York, NY. Hatch, M 2006, Organization theory, Oxford University Press, London. Hughes, M 2006, Change Management: A critical perspective, CIPD, New York, NY. Keifer, T 2002, Understanding the emotional experience of organizational change: Evidence from a merger, Advances in Developing Human Resources, Vol. 4, no.1, pp. 39-61. Lyubomirsky, S., King, L. Deiner, E 2005, The benefits of frequent positive effect: Does happiness lead to success? Psychological Bulletin, Vol. 131, pp. 803-855. Neal, M 2004, Positive emotions in organizations, A multi-level framework, Vol. 1, no.1, pp. 57-73. Pfeffer, J 1981, Management as symbolic action: The creation and maintenance of organizational paradigms. Research in Organizational Behavior, Vol. 3, pp. 1-52. Vince, R 1996, Paradox, defense, and attachment: Accessing and working with emotions and relations underlying organizationa l change, Organizational change, Vol. 17, no.1, pp. 1-21. Weick, K 1999, Organizational change and development, Annual Review of Psychology, Vol. 50, no.1, pp. 361-386. Zerbe, W 2008, Emotions, ethics and decision making, Emerald Group Publishing, New York, NY. This essay on The Influence of Emotions on Organizational Change was written and submitted by user Crystal Carson to help you with your own studies. You are free to use it for research and reference purposes in order to write your own paper; however, you must cite it accordingly. You can donate your paper here.

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