Was Ronald Reagan a Good President Assignment Example | Topics and Well Written Essays - 250 words

Was Ronald Reagan a Good President - Assignment Example Believing this view is subject to failure to realize the key achievement of the former president. 2. Crime: His address at the International Chiefs of Police did not go well with most people as he claimed that crime was a personal choice as opposed to the view that it was a means to survival for some people. His attitude failed in the realization of the real effect of crime in the society leading to wastage of funds in the fight against crime and drug abuse. 3. Defense: During his tenure at the oval office, Reagan increased the budgetary allocation on defense for a period of six consecutive years. This led to a lot of expenditure on defense leading to wastage of public funds and construction of unnecessary demands. The security challenges that were facing the United States at that time were very real and disastrous if they were to manifest. Massive expenditure in the military was thus the best idea in a bid to ensure the nation.

Community Colleges vs College Universites- Compare Contrast Essay Example for Free

Community Colleges vs College Universites- Compare Contrast Essay When graduating high school many students are concerned with choices they have to make as to which college they would like to attend. Some may have more options than others that have to be considered as far as their lifestyle, current jobs, other responsibilities they may have, personality and their academic goals. Choosing a college can be quite difficult. You can either decide on a college university or the local community colleges in your area. Community colleges are smaller than universities. Students will find them to have fewer enrollments which mean smaller classroom sizes. They have a better chance of getting hands on learning, asking more questions and learning course material better. Community colleges have strong advising systems and the advisers know their students well. The courses are usually taught by professors unlike some universities whose courses may taught by grad students. Small colleges as these do not offer near as many courses or academic programs as universities. Tuition at community colleges are so much more cheaper than universities, you may have tuition as much as $3,500. 00 to 5,500. 00 at community colleges versus $30,000. 00 to $50,000. 00 at universities and that itself is a great deal to consider. Another great thing about attending a local community college in your area is that most people can drive back and forth from their own home. They do not have to worry about dorm cost or finding apartments to rent when going away to college universities. College Universities may be for you if you’re interested in having much more degree programs to choose from, if you’re a go getter, not afraid to speak up for yourself and take advantage of opportunities. You may also want to attend a university if you are ready to get away and adventure out from your hometown and meet a whole new diversity of thousands of people. If attending a university you can expect a much higher number of students than a community college. Universities have a wide range of majors and class courses. They tend to have better stocked libraries for all of your researching needs. A lot of students choose universities because of the more programs that are offered and they feel when graduating from a university it looks a lot better having a diploma from a university than community college when applying for a job you have majored in. They also like the fact that there are many activities and a large number of sporting events. They also have a chance to break free and are not tied down at home with their parents. Succeeding at a university requires knowing what areas or subjects you are interested in and motivated about pursuing. Class sizes can contain up to hundreds of students and with that many people in one classroom it can be very hard to keep focus, ask questions and get hands on learning like you can at community colleges. Some students love the environment and find it exciting with that many students but on the other hand others feel depressed and overwhelmed because they may not be able to ask questions and find out the exact information they need to learn. Students who attend universities can be ready to hit the books hard each week and be sure to have a lot of study time. Professors are going to expect a great deal of their students and pile a lot of work on them at one time because they are considered as top-notch schools and they want their students to be well educated and really know the material. It can be very stressful for students who work jobs while in college but they have to make money and support themselves some way or another. Even though universities require a lot of work, students still find time to participate in extracurricular activities such as student organizations or community services. Some even join fraternities and sororities. Universities are likely to have great athletic teams and have a NCAA Divisions with games that are on television. Students love to support their college by wearing school colors on game day and attending all of their games whether they are home or away. Students enjoy the tailgating and party time that comes along with the games, too! Students will either live on the college campus or just a short distance off campus. Most students who stay in dorms have roommates. Some may know their roommates and others may be complete strangers and it can be very uncomfortable for them until they learn who and what kind of person they are. You must expect to sleep in the same room as your roommate, share the bathroom and have no privacy. It’s takes a lot amount of time to get from one place to another on a college university campus because of the number of students. You can expect a rush during lunch hour and a timely wait. There will also be very long lines when trying to register for classes and buying books. It’s up to the person where they choose to attend college. Community colleges and Universities can be very similar but again it’s a whole new world especially when living on a University Campus.

Illegal Immigration into The United States of America :: Immigration Immigrants Persuasive Essays

Immigration, legal or otherwise, is a huge issue right now. Debates rage about how many immigrants should be allowed into the country and how zealously we should guard our border from illegal intruders. To a point, these people are correct, illegal immigration is something that should be stopped. People should not cross the border illegally or overstay on visits. The important question is, however, does illegal immigration deserve the massive amount of attention it receives? No, it does not. By looking at the respected immigrants of the past and thinking about the issues in a clear and objective way, it becomes apparent that illegal immigration (and legal immigration, for that matter) is not as vital an issue as many consider it to be. A key point in this discussion is that many of those who are vehemently opposed to illegal immigration are also opposed to large amounts of legal immigration as well. These thinly hidden agendas mean that often the debate on illegal immigration cannot be separated from the debate on legal immigration. According to Negative Population Growth (which is a suspect source), Americans are firmly believe in tough laws against illegal immigrants and that 70% of Americans want no more than 300,000 legal immigrants to enter the U.S. per year. In fact, N.P.G. says that 20% of Americans want immigration completely stopped. Taking these numbers as the truth, it is clear that America thinks that we have too many immigrants. Such a dislike of immigration is interesting considering the success of past immigration. Many people would say that today's immigrants are somehow different than those of the past. However, the truth is that the similarities between the immigrants of today and those of the past are numerous. Their reasons for coming to this country are often similar. Many of the immigrants of the late 19th and early 20th centuries were compelled to leave their homes by the rapidly changing nature of their countries. In the Europe of the 19th century, this meant quickly growing population and a rapidly industrializing economy. In nations like Mexico and Vietnam, the same thing is happening today, they "are undergoing the same convulsive demographic and economic disruptions that made migrants out of so many nineteenth century Europeans" (Kennedy p.64). Those who are against the immigration of the 1990's also say that the European immigrants of the past were culturally similar to Americans, and that they were more willing to assimilate and become "American." Neither of these things are true. Old immigrant groups like the Italians and may be seen as generically "white" and "American" now, but when they first began moving to the

Black Bourgeoisie Reading Response :: Free Essay Writer

Black Bourgeoisie Reading Response In the first section of Frazier’s Black Bourgeoisie, â€Å"The World of Reality†, Frazier introduces his discussion of the interplay of class and race. He outlines the historical roots of the social place of most African-Americans in the U.S.A. and that of the black middle class. Frazier asserts the inconsequential place of middle class African-Americans and their resulting inferiority complex. He depicts the black middle class as living in a â€Å"no man’s land† in the dominant white culture of America. Frazier begins a more detailed explanation of his theories by discussing the place of the black bourgeoisie in the political and power structures of America. He contends that the black middle class has no real power in America at this time. He attributes the appearance of power to the fact that the members of the black bourgeoisie hold strategic positions in the segregated community. However, he maintains that all of these â€Å"power† positions still feed into the white power structure. Next, he discusses the break with traditional African-American culture. According to Frazier, the black middle class has abandoned the folk culture of â€Å"the black masses† in favor of shell of the middle class white world that rejected them. Therefore, the black bourgeoisie lives in what Frazier calls a cultural vacuum, disdainful of the culture of most African-Americans, dismissed by the white middle class culture. Finally, Frazier discusses the result of this displacement on the black middle class. Because the black bourgeoisie buys into the ideals of white America more and is simultaneously more exposed to its hostility, their sense of inferiority is compounded. They seek to fill this void in two ways.

The Marvelous Meaning of the Scarlet Letter

Life today has changed remarkably from life in the 1800s. During the colonial period, less than 11. 1% of births occurred within the first nine months of marriage. A reported 95% of Americans today have had premarital sex. In today’s society, premarital sex is not considered a sin to most people. In the 1800s, it was a different story. In the novel The Scarlet Letter by Nathaniel Hawthorne, Hester Prynne was found guilty of adultery, branded with a scarlet A, and shunned by the town–an extreme punishment by modern standards.This A that Hester was forced to embroider onto all of her clothing symbolized not only her sin, but the A also held meaning for other characters. It represented the guilt of the man with whom Hester committed adultery: Reverend Dimmesdale. Hester never revealed his identity to the town, and Dimmesdale felt as if he could not confess his sin. Dimmesdale was consumed with penitence, marking himself with an A of his own. Pearl, Hester’s daughter , was another character who found meaning in the scarlet letter, however hers was much different from either Hester’s or Dimmesdale’s.Pearl was the product of her parents’ sin. She was the scarlet letter. For Pearl, the scarlet letter symbolizes life, and she did not understand why it caused her mother so much shame. Essentially, the symbolism of the scarlet letter changed over the course of the novel from something negative, epitomizing shame and sin, to something positive, representing absolution and vitality. The scarlet letter most obviously symbolizes Hester’s sin: adultery. She was forced to wear it as punishment, a cruel reminder of her immorality.Hester had to make the letter herself, so instead of letting it define her, she made it beautiful: â€Å"On the breast of her gown, in fine red cloth, surrounded with an elaborate embroidery and fantastic flourishes of gold thread, appeared the letter A. It was so artistically done, and with so much fert ility and gorgeous luxuriance of fancy, that it had all the effect of a last and fitting decoration to the apparel which she wore†¦ but greatly beyond what was allowed by the sumptuary regulations of the colony† (37). The fact that she embroidered the letter so delicately and so beautifully completely destroyed the purpose for wearing it.In this way, the scarlet letter represents Hester’s independence and free will. Despite the fact that Hester was able to defy the town in that small way, the townspeople saw a different meaning of the scarlet letter. Instead of simply symbolizing the sin of adultery, the town allowed the letter to symbolize Hester herself. When they looked at her, they saw not a human being, not Hester Prynne, but they saw â€Å"a living sermon against sin, until the ignominious letter be engraved upon her tombstone† (44). The town used Hester and the scarlet A to strike fear into their children, to warn them against the sin of adultery.The letter cloaked Hester Prynne. However, the town’s view of Hester changed, thus altering the symbolic meaning of the scarlet letter. Hester never offered â€Å"irritation or irksomeness. She never battled with the public, but submitted uncomplainingly to its worst usage† (110). She helped those in need and was always there to offer a helping hand. Most people in the town had no choice but to â€Å"refuse to interpret the scarlet A by its original signification. † The A no longer exemplified adultery, but rather it represented â€Å"able.† The town acknowledged Hester’s strength, which was what managed to change the symbolism of the A. While Hester Prynne was embracing the A, Reverend Dimmesdale was struggling to escape his own scarlet letter. Dimmesdale was respected and admired by the town, which caused him extreme guilt. He watched as Hester was publicly humiliated, yet he felt as if he could not confess because of his occupation. He was afraid of the â€Å"light his vague confession would be viewed† (99) by the town. He would be refused as a minister, and seen as the â€Å"remorseful hypocrite that he was† (99).Dimmesdale became so consumed with his guilt and shame, that he became physically ill. The A represented his self-punishment, which was worse than if he had confessed publicly. In fact, Dimmesdale envied the ease with which Hester dealt with her scarlet letter so much that he confessed to her how much his secret burned within him: â€Å"Happy you, Hester, that wear the scarlet letter openly upon your bosom! Mine burns in secret! Thou little knowest what a relief it is, after the torment of a seven years’ cheat, to look into an eye that recognizes me for what I am† (131).Dimmesdale was forced to live with the guilt of his misdeed, whereas Hester did not have to hide what she had done. The scarlet letter represented his sin as much as it represented hers, only he could not confess his. When he was with Hester, he felt relief because Hester knew the truth about what he had done. It is when Dimmesdale finally confessed to his sin and claimed Pearl as his daughter that he was able to let go of his guilt, changing what the scarlet letter meant to him. He revealed his involvement with Hester by telling the town to â€Å"look again at Hester’s scarlet letter!He tells you that, with all its mysterious horror, it is but the shadow of what he bears on his own breast, and that even this, his own red stigma, is no more than the type of what has seared his inmost heart† (174). Dimmesdale removed his shirt to reveal an A, marked onto his own chest, whether by Dimmesdale’s own hand, or by the hand of God. For him, the confession freed him of his guilt and shame, allowing him to forgive himself. The scarlet letter that once symbolized his sin, represented his courage to confess and his ability to finally forgive himself.Dimmesdale died after that, because the rel ease of his grip on the scarlet letter that tortured him, allowed him to release his grip on a life that which was haunted by his sin. A character with a unique perspective in the novel, as well as an interesting perception of scarlet letter was the product of the sin–Pearl. The scarlet letter ultimately symbolized the life and love of Pearl. She was pure and had the ability to see the true selves of others, which she understood when she said â€Å"Come away, mother! Come away, or yonder Black Man will catch you! He hath got hold of the minister already.Come away, mother, or he will catch you! But he cannot catch little Pearl† (92). She knew that Dimmesdale had sinned, although she did not know what the sin was, and she knew that she was innocent and pure, and could not be touched by sin. Although the meaning of the scarlet letter did not change much for Pearl, exactly what it meant to her shone brightly through the words on the pages. Pearl knew that â€Å"the great letter A† (122) had given life to her. Hester thought that Pearl did not know what the letter meant, because of the fact that Pearl constantly asked her mother for the meaning of the A.Perhaps Pearl’s innocence kept her from seeing the sin that both her mother and Dimmesdale had committed, but it is clear when Hester asked Pearl if she knew what the letter meant, that Pearl indeed understood it represented sin: â€Å"It is for the same reason that the minister keeps his hand over his heart† (122). Since Pearl was able to sense the wrongdoing of others, she knew that Hester’s physical scarlet letter embroidered on her bosom and Dimmesdale’s internal scarlet letter seared into his chest were both results of sin.She could not grasp that her mother’s letter meant anything atrocious because it was so familiar to her; she had lived her entire life seeing the letter upon her mother’s chest. To Pearl, the A represented her mother and their lif e together. In the end of the novel, the scarlet letter appeared to represent perhaps the most important element of The Scarlet Letter: Family. Hester and Dimmesdale struggled throughout the book to forgive each other and forgive themselves. They were not able to join together as one unit, protecting and loving their daughter, Pearl.Both characters sought to find meaning from the scarlet letter, aside from the negative one bound to it by the town. However, as Dimmesdale built the courage to confess his sin of adultery, he was able to let go of his guilt and accept Pearl. The A indeed might have represented an A for â€Å"able. † For, even though the town had â€Å"doomed Mistress Prynne†¦for the remainder of her natural life, to wear a mark of shame upon her bosom† (43), and Dimmesdale suffered from the weight of shame, they were able to overcome the stigma of the scarlet letter and bring life to the marvelous meaning of the scarlet letter: Love.

Developing Coaching Skills

Developing Coaching Skills Introduction Coaching can be described as the art of developing the performance, learning and development of another person. It involves unlocking the capabilities of another person in order for him to improve his performance. It bridges the gap between, about performing and performing a certain activity.Advertising We will write a custom assessment sample on Developing Coaching Skills specifically for you for only $16.05 $11/page Learn More It is about performing a certain activity through assistance from another person with the experience of that activity who will challenge and offer guidance. It is a continuous operation where the coaches stays with the client, and guides him or her in acquiring new skills and achieves the set goals. It is about achieving goals, and assisting clients on the way of solving problems. It can be described as the structured process management focusing in goals and objectives (Lawson and Miller 57). Developing coaching skills i n the work place Coaching is a leadership style where managers motivate employees to achieve their goals. Managers and leaders use coaching technique to motivate workers and generate better performance. Leaders with appropriate coaching skills usually motivate workers which lead to increased productivity. It is a leadership style which suit many workers in different circumstances. Developing coaching skills in the work place involves improving leadership in the organization through talent management and leadership development. There are two different styles of coaching, which can be developed, directive coaching and non-directive coaching styles. Directive coaching focuses on a certain skill for the employee, to be developed into a higher level. This involves developing a specific skill to achieve a specific objective in a certain period of time. For instance, the managers may coach workers on the performance appraisal technique which requires specific skills. After the coaching pro cess, the workers are able to transfer the knowledge to the customers (Lawson and Miller 72). Non directive coaching occurs usually on a daily basis, where employees are informed about rules and regulations by the human resources department. This involves human resource department answering questions raised by the employees.Advertising Looking for assessment on business economics? Let's see if we can help you! Get your first paper with 15% OFF Learn More Coaching plays a key role in enhancing the overall employee’s competencies. This helps in achieving the organization’s goals and development of individual knowledge and skill. Coaching helps the employees of an organization to have appositive attitude towards their work, and this leads to achievement targets and objectives. It also helps them to discuss how coaching can be used to achieve overall goals, and objectives of an organization. It helps the managers to establish a training plan for de veloping skills, and knowledge of the workers in order, to achieve the organization’s objectives. Coaching human resource professionals involve classroom based programs that provide coaching skills for managers and senior executives. Coaching workshops helps in developing coaching skills to the general audience; it may also target internal coaches in the human resource department. Most organizations develop coaching skills to achieve awareness, responsibility and self belief of the employees. Development of coaching skills in the work place helps in equipping line managers with coaching expertise. This leads to broadening of their leadership abilities and their performance, which improves the overall performance of the organization (Stoltzfus 137). Development of coaching can be achieved in a couple of days, but it takes sometimes to perfect the art of coaching. Developing coaching skills should take sometime in order to review success and learn from tough activities. It shou ld also include a lot of practice as practice makes perfect. Development of coaching skills should involve several line managers, who will support each other support in the process. The organization should ensure that the development of coaching skills is in line with the company’s priorities. The objectives of coaching should also be relevant to the individual needs of the employees. The human resource department should be involved in the early stages of coaching development. This helps in defining goals and objectives of coaching. Human resources department may also want to integrate development of coaching skills with other activities. In the process of developing coaching skills, the organization should set goals, determines the progress before after development (Kimsey 125).Advertising We will write a custom assessment sample on Developing Coaching Skills specifically for you for only $16.05 $11/page Learn More Development programme should be de signed to meet the needs, and circumstance of the team. The first thing is to identify the problem in the organization that coaching skills will help solve. After identify the challenge, determine the managers who can help in developing coaching skills. Depending on the size of the organization, all the managers may be involved at once. If all managers cannot be involved at once, then the senior managers should start. After establishing, the managers to be involved meet with the designers of the programme, and design the programme, which meets the needs of the workers (Williams 215). Using coaching style to improve performance in the workplace Coaching is a leadership style used by managers, to improve performance in the work place, and to achieve the organization’s objectives. Coaching technique is usually applied by the line manager who is the coach. The worker or the employee being coached is the coachee. The line managers have a direct relationship with the coachee and un derstand each other in the coaching lessons. He sets targets, goals and objectives to be attained by the coachee. The line manager will evaluate the progress of the coachee in the coaching sessions and appraise success. The coach will fast track on all the targets, and objectives set by the both parties. The line manager also evaluates the annual performance management system. The line manager may also decide not to have a direct relation with the employee (Beth 215). In this case, the line manager will set defined targets and objectives. There will be official communication between the coach and the employee. The line manager will establish the training needs and enhance knowledge and skills to the worker. He will also set a time frame for the employee to meet the specific objectives. The coach may decide to adopt several models to enhance the coaching style. For example, GROW model (I), which enhances, the coach and the worker to have a better understanding about a problem and fin ding solutions to such a problem (Kimsey 135).Advertising Looking for assessment on business economics? Let's see if we can help you! Get your first paper with 15% OFF Learn More Co-active coaching is where there is active participation in the coaching process between the coach and the client. Behavioral coaching may also be applied; in this case focus is to the behavior of the client rather than his inner goals and motivation. Developmental coaching identifies stages of development, and the coaching depends on the development stage of a person. This is an assumption that behavior is learnt, and it can be improved or changed. The coach may also apply some coaching techniques to improve performance in the work place. For example defining and communicating the organization values. This is a communication technique which starts from the top management, and goes down to all workers. This ensures that all workers uphold general values and adhere to the important values of the organization. He should have excellent communication skills to, communicate to employees, and answer all their questions. The manager may also use the transparent communication technique. Th is involves engagement of employees in managerial activities. It is necessary for the manager to apply this technique as it implies trust, which will improve the overall performance of the organization (Beth 225). Implementing coaching in an organization Organizations willing to implement successful coaching need to consider the most fundamental objectives of managers. Important objectives, such as enhanced leadership skills, and self awareness should be considered. There are several ways in which coaching can be implemented in the work place. Personal coaching, this is where senior managers have an external coach. In this case, an individual may listen directly to the coach and learn skills and knowledge to improve performance. He may also discuss the coaching session with the coach and evaluate the benefits of coaching. The person can also enhance communication, and present skills through directly negotiating with the coach. This will help the person to communicate the skills bett er to the end user. Organizational coaching involves group of managers who work collectively within one coach. This may be implemented through the establishment of a competency development framework (Stoltzfus 142). The frame work will enhance staff development through coaching. Coaching may also be implemented through improving the overall performance management system. In this case, a system is put in place, to monitor the overall performance of the organization. The system will enhance achievement of the overall organization achievement. It can also be implemented through creating the performance management culture among employees in the organization. This will enable employees to have a positive attitude towards achieving organization objectives. Coaching may also be implemented through peer coaching. This is where employees at the same organizational level coach each other. It is developed within programs in management institutes and then applied in organizations. It helps in d eveloping a group of associates, who work interdependently to solve professional problems (Stoltzfus 147). Organizations may also use different approaches to implement coaching in the work place. For instance, succession planning, this involves introducing the succession planning process to the top management. The top management will communicate about the plan to all the other employees. The establishment of a work force to ensure that the plan is agreed. The line manager and the training department provide a report to the work force to ensure the plan is implemented as per the agreement (Whitmore 167). Conclusion Coaching is an art because it requires high levels of inner awareness and external commitment. It is also a science as it involves understanding of the human mind. It involves unlocking the capabilities of another person to optimize his or her own potential. It bridges the gap between thinking about doing something and doing it. It involves performing a certain activity th rough the assistance of another person. Today, coaching is a leadership style used by managers, to enhance achievement of organization objectives by employees. Coaches work with leaders and managers, to develop leadership skills and encourage them to lead by example. Coaching is developed in the work place, to help improve the performance of employees. This leads to the overall organization performance improvement. Coaching for skills helps the managers to acquire specific skills over a period of several months. Coaching for performance helps the manager to be effective in his current position. Coaching for development helps in enhancing the manager’s competency. Finally, coaching for the executive agenda is concerned with issues surrounding the manager such as company downsizing (Stoltzfus 152). Beth, Mary. Executive coaching with backbone and heart. Chicago: Jossey-Bass, 2007.Print. Kimsey, Karen. Co-active coaching:Changing business. London: Nicholas Brealey Publishing, 2 011.Print. Lawson, Karen and Karen Miller. Improved workplace performance through coaching.  Chicago: Amer Media Inc, 2006.Print Stoltzfus, Tony. Leadership coaching. Chicago: BookSurge Publishing, 2005.Print. Whitmore, John. Coaching for performance. New York: Nicholas Brealey, 2009.Print. Williams, Patrick. Becoming a professional life coach. New York: W.W.Norton Company, 2007.Print.

hard times essays

hard times essays Hard Times, by Charles Dickens, was a representation of his time. Times were hard for children and adults alike. People who questioned what they were taught, often went through struggles and "hard times." Eventually, the people who were looked down were the ones who really helped those in need. Throughout the book, there are many ironic Thomas Gradgrind was a man built on the idea that facts and statistics were the only truth in life and all that was needed to have a healthy and productive life. The only truth to him was his very own vision of the truth. Simple put, Thomas Gradgrind strived for perfection. He strived to be perfect, which is what his philosophy was based on, and he strived to make his children perfect and not to wonder. He raised his children never to wonder, never to doubt facts and to never entertain any vice or fancy. As soon as Gradgrind's children were old enough to absorb, he was feeding giving more lessons than they could hold. His children were brought up only knowing one way to live and that was the idea that if it is not fact, then it is false. He was emotionaless as were his children because they were brought up only knowing what they were taught by him. Eventually, as Gradgrind's children became older, what they were taught began to turn sour in their minds. Tom, Grandgrind's son, began to despise his father and all he was taught and thus began to rebel. He took to smoking and gambling, which eventually led to his downfall. Tom had grown up to become a sycophantic, self-absorbed parasite. He had turned out the exact opposite as hoped. Thomas Gradgrind had raised his children never to wonder, but wondering intrigued them. Gradrgind had observed his children peeking into a circus tent because they were curious as to what was inside. The children were scolded for being curious, but seeds were planted into their minds of how there was more to life than what t...

Introduction to Behavioral Economics

Introduction to Behavioral Economics Behavioral economics is, in a way, at the intersection of economics and psychology. In fact, the behavioral in behavioral economics can be thought of as the analog of the behavioral in behavioral psychology.   On one hand, traditional economic theory assumes that people are perfectly rational, patient, computationally proficient little economic robots that know objectively what makes them happy and make choices that maximize this happiness. (Even if traditional economists acknowledge that people aren’t perfect utility-maximizers, they usually argue that the deviations are random rather than showing evidence of consistent biases.) How Behavioral Economics Differs From Traditional Economic Theory Behavioral economists, on the other hand, know better. They aim to develop models which account for the facts that people procrastinate, are impatient, aren’t always good decision-makers when decisions are hard (and sometimes even avoid making decisions altogether), go out of their way to avoid what feels like a loss, care about things like fairness in addition to economic gain, are subject to psychological biases which make them interpret information in biased ways, and so on. These deviations from traditional theory are necessary if economists are to understand empirically how people make decisions about what to consume, how much to save, how hard to work, how much schooling to get, etc. Furthermore, if economists understand the biases that people exhibit that lower their objective happiness, they can put on a bit of a prescriptive, or normative, hat in either a policy or a general life advice sense. The History of Behavioral Economics Technically speaking, behavioral economics was first acknowledged by Adam Smith back in the eighteenth century, when he noted that human psychology is imperfect and that these imperfections could have an impact on economic decisions. This idea was mostly forgotten, however, until the Great Depression, when economists such as Irving Fisher and Vilfredo Pareto started thinking about the human factor in economic decision-making as a potential explanation for the stock market crash of 1929 and the events that transpired after. Economist Herbert Simon officially took up the behavioral economics cause in 1955 when he coined the term bounded rationality as a way to acknowledge that humans dont possess infinite decision-making capabilities. Unfortunately, Simons ideas werent initially given a lot of attention (though Simon did win a Nobel Prize in 1978) until a couple of decades later. Behavioral economics as a significant field of economic research is often thought to have started with the work of psychologists Daniel Kahneman and Amos Tversky. In 1979, Kahneman and Tversky published a paper entitled Prospect Theory that offers a framework for how people frame economic outcomes as gains and losses and how this framing affects peoples economic decisions and choices. Prospect theory, or the idea that people dislike losses more than they like equivalent gains, is still one of the main pillars of behavioral economics, and it is consistent with a number of observed biases that traditional models of utility and risk aversion cannot explain. Behavioral economics has come a long way since the initial work of Kahneman and Tversky- the first conference on behavioral economics was held at the University of Chicago in 1986, David Laibson became the first official behavioral economics professor in 1994, and the Quarterly Journal of Economics devoted an entire issue to behavioral economics in 1999. That said, behavioral economics is still a very new field, so there is a lot more left to learn.

Personal Statement for UCAS Essay Example | Topics and Well Written Essays - 750 words

Personal Statement for UCAS - Essay Example This essay discusses the reasons why the researcher chose to study International Relations, that was mostly due to his interest in world affairs and politics. This entails the cultural differences that are displayed by different nationalities. The development of a country is always fascinating to study because a lot can be learnt from it. Some of the particular topics that are of importance to me are corruption, human rights, and discrimination. The researcher states that it was his father, who encouraged him to pursue a course in International Relations in college because the researcher would be able to live out his dream. In the learning of other cultures, the researcher is able to understand what needs to change within his own culture as well. The author would like to impact his country in a positive way, and taking a course in International Relations will help him to achieve that. Because International Relations is very broad, the researcher would like to focus more on the differ ent economic and political systems that are in place across the world, such as the UK and former USSR, that both are great examples of countries that are very different both politically and economically. The researcher would like to understand how the teachings of Karl Marx affected society in the USSR and what effect this had on the Soviet people, that lived through such events. He would also like to understand the reasons behind this and how the researcher can impact his country in the same way today.

Managment Essay Example | Topics and Well Written Essays - 3750 words

Managment - Essay Example The likely effects of demand increases on Iron-ore prices: Price can be seen as the interaction between the supply and the demand quantity as can be seen in the Figure below. The resultant market price would therefore depend upon such interaction at a specific quantity. The transaction can be done when so ever the goods or services are agreed to be bought at the market price. When transaction occurs at this price the resulting output is the equilibrium or the market clearing price as show below. As the Chinese population continues to grow so does the demand for the minerals and metals, this has not only cause the rise of Iron-ore production but also of any other inputs products used in its formation in short the supply of iron-ore increases with the increasing demand of iron-ore. We can see this in diagram below that represents a rise in the demand of iron-ore. Figure  1  an increase in demand (P.S. the word Beer can be replace by any product) The diagram notifies the increase in demand for iron-ore has increased the quantity of its production moreover there is rise in price from p1 to p2. Thus, as the quantity raises so does the demand, this is the resulting effect. The likely effect of increase on Iron-ore production To meet the ever increasing demand of iron-ore in the market the production of its input supplies would even have to increase. Suppliers only increase the product supply where there is less marginal cost of production. Therefore, we see that there is an increase in supply as shown by the diagram below. Therefore, we can notice that any increase in demand would of course raise the supply, the price and the quantity of that product. To absorb the clear effects,... This paper approves that the notion of preference has a vital role in many of the disciplines, covering moral philosophy and also decision theory. Preferences and their properties of logic also have a vital role in the rational choice theory, a subject that in turn permeates the modern economics, as well as the other branches of formal social science. The notion of this preference and the way it is analyzed vary between these disciplines. The treatment that is yet lacking is the one that takes into account the requirement of all usages and tries to gather them in some unified approach. This entry surveys the most vital philosophical use of the preference concept and deeply looking into their compatibilities and conflicts. An increase number of people’s preference for work would shift the supply curve to the right side, and increase the employment from but however it would also reduce the wage rate from. This paper makes a conclusion that a preference that attributes to workers at work places varies from self-preferences off work. The characteristic of job preferences are supervision, retirement benefits, morning and late hours, job security, and easier type of work, the company, the wage rate, good and helpful co-workers, job advancement, and favorable working conditions. Women might not very much interested in working in a mining industry due to factors such as poor job security, unfavorable working conditions, difficulty of work and late hours at mining that might not be of their preference.

Problem and Solution paper Assignment Example | Topics and Well Written Essays - 750 words

Problem and Solution paper - Assignment Example Mobile phones have formed an integral part in the current telecommunications as well s electricity and have since formed part of the day to day living of people. The exposure of a person to a mobile phone is usually measured in terms of Specific Absorption Rate. Mobile phones use radio frequency signals whose exposures to body issues have adverse health effects. Even though the exposures to these signals from phones are low and within EU limits, they could have long term effects on humans. The RF fields normally penetrate the tissues of the body to varied depths depending on their frequency. When energy from RF is absorbed into the body, it is changed into heat which is then carried away by body tissues. It is this heat that has health effects. Recent research has shown that the exposure of RF to body tissues do not cause cancerous infections because of its low levels. Issues that raise concerns over the safety of mobile phones on health are whether continued exposure to these signals could cause infectious diseases. Mobile phones have not been embraced for a period long enough to ascertain their long term effects. For this reason, it is sti ll unclear the extent of long term use of these forms of technology in relation to the occurrence of the disease acoustic neuroma. (Burgess 188) On the other hand, those who live around power lines are at a risk of contracting cancerous infections though the probability is extremely low. These lines provide Extremely Low Frequency fields. A recent research conducted by the International Agency for Research on Cancer there is a possibility that these magnetic fields are a human carcinogen. However, it was stated categorically that this is not a direct insinuation that the magnetic fields are actually carcinogenic but was classified as a possibility. (McCall 120) A 1979 research raised concerns of increased incidences of leukemia realized in children who lived in residential places that were close to

A REVIEW OF PROVIDING EMPLOYEES BENEFITS IN SAMSUNG IN SOUTH KOREA Essay

A REVIEW OF PROVIDING EMPLOYEES BENEFITS IN SAMSUNG IN SOUTH KOREA - Essay Example Korean based firm that is headquartered in Suwon. Having been established in 1969 when it was referred to as Samsung Electric Industries, the company has embarked on product diversification an aspect that has made it to enjoy a competitive position in the electronic industry. Soon after it was established, the company embarked on acquiring other firms within the same industry with an objective of expanding its capital bases as well as putting in place effective marketing strategies. Some of the notable firms that Samsung acquired were Korea Semiconductor and Korea Telecommunication in 1974 and 1980 respectively. Investing in technology especially between 1995 and 2008 made the company to acquire a significant market share an aspect that made the company to effectively face off its key competitor Sony. In order to effectively meet the needs of its global market, the company diverted from consumer brands to enter in the filed of memory. This made it to be a key supplier of the NAND mem ory and A7 processors to the Apple Company. Recently, Samsung has indicated an expansive growth that has made it not only to incur high profits but also it has created a strong positive consumer product relationship. From the introduction and adoption of 5G technology to the launching of Galaxy S series, Samsung registered a profit of US $9.4 billion in the third quarter of 3013. In order to ensure that its operations are effectively varied out in the local and global market, Samsung maintains a workforce of 470,000 employees. Thus the need to keep them motivated as a way of enlacing the company profitability. 1.2 Research title, research question and research objectives A review of providing employees benefits in Samsung in South Korea Research question What is the impact of providing employees benefits in Samsung? Research objectives Analyzing the impact of employees benefit program on Samsung performance Outline the employees, benefits program Reviewing the implementation of prov iding employees benefits in Samsung Company What are the benefits of providing employees for the company? 1.3 Research rationale This research will use the studies done by various individuals who have done extensive coverage of the benefits offered by the Samsung Company in its effort to improve the productivity of its employees. 2 Literature review 2.1 Introduction Being an international company with an objective of expanding its customer bases and acquiring a wide market segment, Samsung has a strong linkage with its employees. Ranging from technical managers to the sales representative, the company has established a number of employee’s benefits that are aimed at motivating them thus improving their productivity. Through the establishment of Samsung’s welfare system, the company provides not only financial support to the employees, but also it provides health, leisure and education facilities to the employees. The establishment of an integrated benefit scheme, Samsu ng has maintained a strong workforce that has made it to put at bay it key competitors including Nokia and Apple. The part below reviews studies done by various people on the impact of providing employees benefits in Samsung. 2.2 High compensation In his studies on compensation and negotiation, Chingos (1985) support an increment of salaries not only as a way of compensating them but also as

Comparstive law Essay Example | Topics and Well Written Essays - 3750 words

Comparstive law - Essay Example The paper aims to understand the meaning and the concepts related to the comparative law. Besides it also provides an in detail description about different legal principles and its applications at various situations concerning the contract law. This is done by resolving a case study which revolves around three parties – the lessor, the lessee and the contractor. The paper is divided into two sub sections: the first section specifies the definition, meaning and relevance of the comparative law. It identifies and defines the various clauses and legal principles related to the comparative law. The second section of the paper deals with the case study – an overview of the case, description of the parties involved, legal principles related to the different situations arising in the case and providing a solution in accordance with the contract law clauses and cases. The paper concluded with a general observation on which law would be best suited to resolve the case had it been a real life scenario. All the references to the cases are derived from the books mentioned in the bibliography at the end of the report. In order to appraise the development and use of comparative law in the modern world, it is necessary to examine the nature, scope and its origin. Traditionally, comparative law has been comparative law of legal orders. This means that it is still pre determined by the tradition of 19th-century legal thought, where law is seen a system of positive legal orders.... thought, and define itself more as comparison of legal systems in the sense of systemization discourses. There are no less than 42 legal systems in the world, and comparison has traditionally focused on three major legal families in the world, namely the civil law system, common law system and socialist system. So, 'comparative law' can be said to describe the systematic study of particular legal traditions and legal rules on a comparative basis. To qualify as a true comparative law enterprise, it also requires the comparison of two or more legal systems, or two or more legal traditions, or of selected aspects, institutions or branches of two or more legal systems. Razi argues that a legal system in the wide sense 'is not made of rules alone but is also characterized by its institutions, practices, standards of research and even the mental habits of lawyers, judges, legislators and administrators' (Razi (1959) 5 Howard LJ 11). Legal culture has been define by Lawrence Friedman as 'ideas, values, expectations and attitudes towards law and legal institutions which some public or some part of the public holds' (Friedman (1997)). Comparative law is, therefore, primarily a method of study rather than a legal body of rules. Importance of Comparative Law: The comparative method has frequently been of practical significance to courts and the judicial process, in filling gaps in legislation or in case law, in providing the background and origin to legal rules and concepts which have been inherited or transplanted from other jurisdictions, in matters which are not covered by a code provision or statute or case law authority. In this way, a variety

A REVIEW OF PROVIDING EMPLOYEES BENEFITS IN SAMSUNG IN SOUTH KOREA Essay

A REVIEW OF PROVIDING EMPLOYEES BENEFITS IN SAMSUNG IN SOUTH KOREA - Essay Example Korean based firm that is headquartered in Suwon. Having been established in 1969 when it was referred to as Samsung Electric Industries, the company has embarked on product diversification an aspect that has made it to enjoy a competitive position in the electronic industry. Soon after it was established, the company embarked on acquiring other firms within the same industry with an objective of expanding its capital bases as well as putting in place effective marketing strategies. Some of the notable firms that Samsung acquired were Korea Semiconductor and Korea Telecommunication in 1974 and 1980 respectively. Investing in technology especially between 1995 and 2008 made the company to acquire a significant market share an aspect that made the company to effectively face off its key competitor Sony. In order to effectively meet the needs of its global market, the company diverted from consumer brands to enter in the filed of memory. This made it to be a key supplier of the NAND mem ory and A7 processors to the Apple Company. Recently, Samsung has indicated an expansive growth that has made it not only to incur high profits but also it has created a strong positive consumer product relationship. From the introduction and adoption of 5G technology to the launching of Galaxy S series, Samsung registered a profit of US $9.4 billion in the third quarter of 3013. In order to ensure that its operations are effectively varied out in the local and global market, Samsung maintains a workforce of 470,000 employees. Thus the need to keep them motivated as a way of enlacing the company profitability. 1.2 Research title, research question and research objectives A review of providing employees benefits in Samsung in South Korea Research question What is the impact of providing employees benefits in Samsung? Research objectives Analyzing the impact of employees benefit program on Samsung performance Outline the employees, benefits program Reviewing the implementation of prov iding employees benefits in Samsung Company What are the benefits of providing employees for the company? 1.3 Research rationale This research will use the studies done by various individuals who have done extensive coverage of the benefits offered by the Samsung Company in its effort to improve the productivity of its employees. 2 Literature review 2.1 Introduction Being an international company with an objective of expanding its customer bases and acquiring a wide market segment, Samsung has a strong linkage with its employees. Ranging from technical managers to the sales representative, the company has established a number of employee’s benefits that are aimed at motivating them thus improving their productivity. Through the establishment of Samsung’s welfare system, the company provides not only financial support to the employees, but also it provides health, leisure and education facilities to the employees. The establishment of an integrated benefit scheme, Samsu ng has maintained a strong workforce that has made it to put at bay it key competitors including Nokia and Apple. The part below reviews studies done by various people on the impact of providing employees benefits in Samsung. 2.2 High compensation In his studies on compensation and negotiation, Chingos (1985) support an increment of salaries not only as a way of compensating them but also as

How to balance online school work with family demands Essay

How to balance online school work with family demands - Essay Example These days, it is quite popular (Hinkle, 2009). The advantage of distance learning is that it seeks to maintain a balance between family and education. In addition, individuals are free to pursue the fields that they feel are more suited to their interests. It also allows the students to study freely and at their own pace. It has the further benefit of costing less (Zimmerman, pp. 39-41). However, there are always problems associated with time management. Most of the individuals who are studying online are mature adults who have the responsibility of the household and various family demands. Therefore, there is an inherent challenge associated with managing both things at the same time. A study done in United Kingdom showed that adults have faced problems trying to balance online education with the demands of family and household chores (Wheeler, pp.32). Pursuing education is an amazing experience; however, it requires a lot of time and patience. It can be quite exhausting doing all the cooking, cleaning, looking after children, and studying as well. On a personal level, I have faced numerous difficulties because my family demands came in the way of my studies. One such example was when I had to submit a paper, and suddenly one of my children fell ill. Now child requires my constant attention, and mostly I put him to sleep while I am studying. However, the paper was extremely lengthy and my child was constantly crying. A crying child in hands while typing away on the laptop is an extremely excruciating experience. A person has to think of the child first, while there is a constant nagging at the back of the mind that there is a lot of work to be done, which may include laundry, ironing, cooking, and obviously studying. Another worrisome thought is also to protect the electronic gadget from the child’s hands. The child demanded constant attention, and even when I took him to the doctor, I had to wait quite a lot. Buying medicines, rushing home, forcing th e medicine down the child’s throat, and finally putting him to sleep took away all my energy. Quite obviously, I submitted my paper late and I had to deal with many issues. My other child is an avid sportsperson. He participates in softball and basketball. I have to manage driving him around to his games and sitting to cheer him on during these games. He expects me to be there with him for all the games and he ends up getting hurt if I even talk about missing one game. Caught up in work and extended family issues, I could not prepare properly for an exam that was coming up. The final match of my son’s basketball team had to be one day before the exam. Well, that is my fate, I guess. Sitting with books, with my other child on the next seat constantly tugging my hand for drinks and popcorn, and trying to cheer my child was an extremely agonizing experience. The question was to study or not to study. Although I managed to secure good marks in the exams, but it did require a night of staying up to study, already exhausted from the day. Therefore, the point of sharing my personal experiences was that although distance learning has made me return to education, it is still not as convenient as people might think it is. However, quite a lot of time has passed since I have been pursuing online education, and I love almost every minute of it. On weekends usually, I cook quite a lot of food and deep freeze it. In addition, I do the laundry and

Red Bulls Market Essay Example for Free

Red Bulls Market Essay A Bulls Market the marketing of Red Bull energy drink Red Bull, Austrias biggest export since Arnold Schwarzenegger, has methodically created and dominated the energy drink category much in the way players of the board game Risk would defeat their opponents. Dietrich Mateschitz, the owner of Red Bull International, created the highly caffeinated beverage in 1987. Five years later, the drink spread into neighboring countries like Hungary and Slovenia, followed by Germany and Switzerland. In 1997, Red Bull prepared to storm the U. S. market. Today, the slinky 8-3-OZ can has completed its invasion into nearly every cold box in the United States. (Ohio, Tennessee and the Dakotas are among the few states without it. ) In less than three years, Red Bull singlehandedly established and then lifted the booming energy drink category from a base of $12 million in (wholesale) dollar sales to $42 million in 1998 and $75 million in 1999, per Beverage Marketing Corp. Others soon followed, building energy drinks to a $130 million business. Now Coke (KMX) and Anheuser-Busch (180) are jumping in. Last year, Red Bulls market share stood at 65%, while the company reportedly pulled in a cool $1 billion in worldwide sales. Just how Red Bull managed to accomplish so much, so quickly has become the stuff of mythology Some have written off the product by calling it a flash in the pan or derisively note that its handlers got lucky. A closer investigation of the companys strategy however, reveals that luck had little to do with Red Bulls success. The companys consistent battle plan has been to open up a market by securing unusual distribution. When Red Bull initially set up camp in Santa Monica, Calif. , it piggybacked on established distributors. Typically distributors will deliver a number of brands; a Pepsi house will handle Pepsi, Diet Pepsi and Mountain Dew, and may even pick up a non-competing rival like Dr Pepper. Sales reps even greased the wheels by paying for their accounts promotional, advertising and sampling costs for three months. But as the drink caught on, the company began taking a more narrow approach. Now, a Red Bull sales rep will contact a small distributor and insist that he or she sell only Red Bull. Otherwise, Red Bull will set up a warehouse and hire kids to load up the vans and deliver product. These start-up distributors can focus their entire energies on getting Red Bull fully stocked in stores with prominent shelf placement. They generally break even within three months and are profitable within six. They buy direct from Red Bull. Theres enough margin and volume to make it work, said one Northeastern distributor. I wish theyd give it to me, but they have the kids with the vans doing it. Im looking forward to getting Snapples Venom [a new energy drink launching June 15] so I can compete with them. Next, the sales team visits key on-premise accounts: hot clubs and trendy bars. When owners begin buying a few cases, they receive a Red Bull branded cooler and other POP items. Thats when we start doing business officially, said Markus Pichler, evp-strategic planning, Red Bull North America. We go to on-premise accounts [vs. retailers] first, because the product gets a lot of visi bility and attention. It goes faster to deal with individual accounts, not big chains and their authorization process. Plus, on-premise provides fertile ground for new drink trends. In clubs, people are open to new things, said Pichler. The most important thing about [Red Bull] is, its working. If you had a tough week and want to dance, the product works. Perhaps a bit too well. Fueling Red Bulls growth is a mystique created by outlandish rumors about its contents: it is liquid Viagra; its secret ingredient is bulls testicles; someone overdosed from the drink because it has drugs in it. (The company shoots down these and other myths in an FAQ section on RedBull. com. Pichler wouldnt talk about Red Bulls natural fit with the speed crowd that frequents raves, taking designer drugs to stay awake for days at a time. Nor does the company endorse the mixing of Red Bull with vodka, Jagermeister or tequila-a ubiquitous bar call whose roots can be traced to Europe. From a sales perspective, Pichler acknowledged, [the mixability] is a nice side effect. Theres more to the guerrilla strategy than building buzz at clubs. Sales teams will open off-premise accounts at convenience stores near colleges, gyms, health-food stores and supermarkets. The company has divided the U. S. into eight decentralized sales units, each of which is handled on a city-by-city basis. One regional office in New York, for example, services Maryland, New Jersey Pennsylvania and Virginia. The Boston office handles the New England states and upstate New York. Each unit is responsible for creating distribution, making sales calls and developing targeted marketing plans. The mission: to find out where the target demo (men and women age 16-29) hangs out and what interests them. Its their job to get the message out to the right clubs and at the right events. While Red Bull relies heavily on bars and night clubs for its sampling events, alternative sports have also proven to be a successful product-trial arena. The company underwrites a number of extreme sports competitions and sponsors about three dozen alterna-athletes. Events include the Red Bull Huckfest, a ski and snowboard freestyle competition held in January in Snowbird, Utah; and the Red Bull Flugtag (German for flying day),premiering in the U. S. this fall. At the latter event, amateur pilots will create exotic flying machines and attempt to soar off the Santa Monica pier. The brand also employs teams of consumer educators, who roam the streets and dangle free samples. With California as its stronghold, Red Bull made its way into Oregon, Settle, Texas and ski resorts in Colorado. It next moved into the Midwest, targeting urban markets like Chicago and its environs. Soon it showed up on the East Coast in Miami and New York. (The Big Apple had a head start: Europe leaked the beverage into the city) Newer markets include the Carolinas, Virginia and Washington, D. C. In the antithesis of any majors marketing plan, Red Bull buys traditional advertising last. Only when a market is deemed mature does the company begin a media push. The idea is to reinforce, not introduce, the brand. Media is not a tool that we use to establish the market, said vp-marketing David Rohdy. It is a critical part. Its just later in the development. Current ads, titled Red Bull gives you wings, focus around an animated bull character. The initial spot is set in the Renaissance era, where an artist is telling the man who commissioned his painting that he has created the perfect piece of art: Red Bull. Itll give you wings, he said. Indeed, in another ad, an energized bull is shown leaping over a city. The ads have begun airing during late-night TV in New York, and radio programs including The Howard Stern Show. A Santa Monica-based shop, Lunch, handles ads and POP materials for the entire U. S. Red Bull typically creates two new TV spots a year and runs them in mature markets. The brand spent $100 million in the U. S. last year, according to the company Measured media spending was only $18. 9 million last year, up from $9 million in 1999, per Competitive Media Reporting. Red Bulls runaway popularity had given it easy entree into mass merchandisers. It is currently the No. 1 product in Store24, where it is now a bigger seller than beer, milk, water and soda. 7-Eleven is experiencing similar results. We have seen double-digit growth [in the non-carbonated segment]. Red Bull tops the list big time, said Jim Jackson, category manager for non-carbonated beverages at 7-Eleven, Dallas. [Their success is due to] their single-product focus, major advertising dollars and distribution. They create demand before they even get it to retail. The picture may yet change, as Red Bull is now facing more than a dozen imitators, most notably Cokes KMX and A-Bs 180. Knockoffs they may be, but distributors say they have been moving extremely well. Weve done a lot of the dirty work for them, Rohdy said. Pichler was a bit more engaging. Were a fan of competition. Its a positive for us, he said. It validates the energy drink category. Red Bull has already experienced the c opycat phenomenon overseas. The company doesnt appear to be concerned, however, having hit the $1 billion worldwide sales mark. Besides, observers have said the also-rans dont have a prayer. Red Bull seems to have a cooler in every bar in every city. The sales force, thats all they do, said one new age beverage executive. The big guys will not put that much energy into it and will lose interest when they dont make any headway. After conquering the U. S. , the Red Bull army plans to move on. It is currently making headway in Brazil and South Africa, though South America and Africa as a whole remain largely untapped. If history repeats itself, it wont be long before everyone on the planet gets their wings.

Impact of Mergers and Acquisitions on the TATA Group

Impact of Mergers and Acquisitions on the TATA Group IMPACT OF MERGERS AND ACQUISITIONS ON THE FINANCIALS AND PERFORMANCE OF TATA GROUP In the current globalised economy, mergers and acquisitions are being progressively more used the world over, for increasing competitiveness of companies through gaining better market share, expansion of the portfolio to reduce business risk, to capitalize on the economies of scale and for entering new geographies, etc. This research study was intended to analyze the consequence of going global market through merger and acquisition and traders long and short term earnings .Thereby study the impact of mergers on the financials by examining some pre- merger and post-merger financial ratios, with the sample of firms chosen as three major mergers/acquisitions of TATA Group. The results put forward that there are small variations in terms of post merger financial performance of the joint firm is not considerably different from the aggregate performance of the acquirer and target companies before the merger. INRODUCTION Merger and acquisitions have emerged as chief forces in the contemporary financial and economic environment. They have been a source of corporate growth and in India, it has changed radically after the liberalization of Indian economy. Mergers and acquisitions came up as one of the most efficient methods of such corporate restructuring, and became an essential part of the long-term trade strategy of corporates in India. The sole three chief objectives at the back any MA transaction were found to be: Improving Profitability Rapid growth in scale and closer time to market Acquirement of new technology Many in corporate India would be jealous of the Tata Groups strategy around mergers and acquisition. In the past 8 years, the Tata Group had made 35 overseas acquisitions, including coal and iron ore mines, adding up Rs 78,000 crore, mostly in the past 3 years. Research problem To examine the consequence of going global through mergers and acquisitions and the traders long term and short term earnings respectively. This would aid in studying the impact on companies financials past the merger or acquisition. To also determine the enterprise value of the corporation by comparing it with the peer group and studying the value of the firm Objective of the study To analyze the a thorough detailed case study of 3 companies of Tata Group who merged or acquired in the past years. To evaluate the closing price of 3 companies previous to and post acquisition To weigh up the key financial ratios of 3 companies pre and post acquisition To do valuation of two companies through enterprise value and contrast the value with peer group and examine in detail Review of literature The subsequent studies are the few existing work reviewed which were conducted by researchers in the sight of analyzing the financial performance during and post merger activity across different time periods. Effect of mergers on corporate performance in India, writer Mrs. Vardhana Pawaskar (2001), considered the impact of mergers on corporate performance. A case study, assessed the financial performance of a cloth unit by using ratio analysis. It compared the before and after merger performance of the corporations between 1992 and 2000 to identify their financial character. The study found that the financial fitness was never in the strong zone during the whole study period and ratio analysis highlighted that decision-making incompetence accounted for a good number of the problems. Forecasting the viability and operational efficiency by Mr Mulla through use of ratio analysis, suggested matching up efficiency and success of all facets of management and put the company on a lucrative footing. The study of a sample of firms, restructured through mergers, showed that the merging firms were at the inferior end in terms of liquidity of the industry. The merged firms gave better performance than industry in terms of profitability. Mergers and operating performance by Mr. Mantravadi: An Indian perspective, attempted to examine the impact of mergers on the performance post industrial reforms, by investigating some pre- and post-merger financial ratios, with chosen sample firms, and all mergers linking public and private limited companies The study results suggested that there are minor variations in terms of impact on financial performance of subsequent mergers across different intervals of time in India. It also indicated that for mergers between the same groups of companies in India, there has been deterioration in performance and ROI. Mergers acquisitions in the banking sector presents the Indian scenario, author Mr. Selvam (2007) has analyzed the impacts of stock price changes to mergers and acquisitions behavior taken place in banking industry with particular reference to private and public sector banks. Found that share prices are market sensitive. From the financial analysis it was noted that greater part of the banks went for branch extension and this has affected profitability to some extent and it resulted in harmful competition among the players. To add up the review of literature, many offerings have offered diverse perspectives of merger in different industries globally and explained the valuation techniques followed by merging companies, and shareholders possessions effect due to merger. From the review of several papers evaluating the pre and post merger performance of merged companies, it is incidental that majority of the studies powerfully support the concept of improved post merger performance due to merger and it is valuable to the acquirer companies. METHODOLOGY Methodology of the study Sample selection There are several mergers within the TATA Group during the study period from 01.04.2006 to 31.03.2009. For the purpose of corporate analysis, it was decided to select three of the highest deals which merged/ acquired under the TATA Group during the study period. Hence, the sample size of this study is confined to 3. Besides, while selecting the sample, following points were taken into account. Acquirer and target companies ought to belong to the same industry. Availability of information on the merger and industry. Period of the study The present study covers a period of one year from April 1, 2006 to March 31, 2009. But in order to evaluate the financial performance of sample companies on a comparative basis, 15-20 days before merger and after merger were considered. Sources of data The present study fundamentally depends on secondary data. The required data on financial performance prior and post merger were composed and they were obtained from Prowess software, Internet sources, Business Journals (ICFAI JOURNAL ON M A) The data were also collected from books, and newspapers. Tools used In order to study the financial performance of acquirer and target companies, ratios Debt-Equity Ratio, ROCE (%),net profit margin, P/E, EPS, OPM(%) and valuation. (1) Analysis of financial performance The pre-merger average performance of the companies were compared with the post- merger performance of the joint firm. The present study attempts to calculate and study the pre and post merger performance of acquirer and target companies by using financial ratios in order to determine whether mergers resulted in shareholders wealth or not. Accordingly, the following null hypothesis has been tested: H0: The post merger financial performance of the combined firm is not significantly different from the aggregate performance of the acquirer and target companies prior to the merger. (2) Ratios Debt-Equity Ratio: A gauge of a companys financial leverage obtained by dividing  the total liabilities  by  stockholders equity. It shows what proportion of equity and debt the company is presently using to finance their assets. Return On Capital Employed (ROCE) : ROCE compares earnings with the invested capital in the company. It is like Return on Assets (ROA), but also considers sources of financing Net profit margin: The profit margin says how much profit a company makes for every 1 Rupee it generates in revenue or sales. Profit margins vary with industry to industry, but all else being equal, the greater a companys profit margin compared to its competitors, the better. P/E: It is a gauge of the price paid for a share relative to the annual net income or the net profit earned by the firm per share. EPS: The portion of a companys profit which is allocated to each outstanding share of common stock.  Earnings per share  acts as an indicator of  a companys profitability. OPM: Operating margin is a measurement of the proportion of a companys revenue that is left over after variable costs of production such as wages, and raw materials have been paid. A healthy operating margin is required for a company to be able to pay for its fixed costs, such as interest on debt. Also known as operating profit margin and net profit margin. (3) Enterprise Value Enterprise value is a figure that, in theory, represents the entire cost of a company if someone were to acquire it. Enterprise value is a more accurate estimate of takeover cost than market capitalization because it takes includes a number of important factors such as preferred stock, debt, and cash reserves that are excluded from the latter metric. ANALYSIS OF DATA TATA GROUP OF COMPANIES One of the Indias largest business groups in the country. It has about 96 operating companies. Diverse business in 7 sectors. Revenues equivalent to 5.3% of Indias GDP. Group revenue FY 2008: Rs 251,543 Cr. / $ 62.5 b. Group profit FY 2008: Rs 21,578 Cr. / $ 5.4 b .Its 27 publicly listed companies have a combined market capitalization which is the 2nd highest among all business houses in India. Largest employer in private sector over 300,000 employees. A shareholder base of over 2.9 million. Operations in over 80 countries. Products and services exported to 85 countries Tata is a rapidly growing business group based in India with significant international operations. Revenues in 2007-08 are estimated at $62.5 billion (around Rs251, 543 crore), of which 61 per cent is from business outside India. The group employs around 350,000 people worldwide. The Tata name has been respected in India for 140 years for its adherence to strong values and business ethics. The business operations of the Tata group currently encompass seven business sectors: communications and information technology, engineering, materials, services, energy, consumer products and chemicals. The groups major companies are beginning to be counted globally. Considering two of the largest mergers of TATA Group -Tata Steel became the sixth largest steel maker in the world after it acquired Corus. -Tata Communications is a leading global provider of a new world of communications. With a leadership position in emerging markets, Tata Communications leverages its advanced solutions capabilities and domain expertise across its global and pan-India network to deliver managed solutions to multi-national enterprises, service providers and Indian consumers. TATA STEEL-CORUS About the acquisition Date: 30th March 2007 Acquirer: Tata Steel Limited Target company: Corus Plc. Stake: 100 % Deal amount: US$ 12201 m Sector: Steel sector MERGER On January 31, 2007, India based Tata Steel Limited (Tata Steel) acquired the Anglo Dutch steel company, Corus Group Plc (Corus) for US$ 12.20 billion. The merged entity, Tata-Corus, employed 84,000 people across 45 countries in the world. It had the capacity to produce 27 million tons of steel per annum, making it the fifth largest steel producer in the world as of early 2007. Before the acquisition, the major market for Tata Steel was India. The Indian market accounted for sixty nine percent of the companys total sales. Almost half of Corus production of steel was sold in Europe (excluding UK). The UK consumed twenty nine percent of its production. After the acquisition, the European market (including UK) would consume 59 percent of the merged entitys total production. DEAL : An auction was initiated on January 31, 2007, and after nine rounds of bidding, TATA Steel could finally clinch the deal with its final bid 608 pence per share, almost 34% higher than the first bid of 455 pence per share of Corus. Synergies There were many likely synergies between Tata Steel, the lowest-cost producer of steel in the world, and Corus, a large player with a significant presence in value-added steel segment and a strong distribution network in Europe. Among the benefits to Tata Steel was the fact that it would be able to supply semi-finished steel to Corus for finishing at its plants, which were located closer to the high-value markets The Pitfalls Though the potential benefits of the Corus deal were widely appreciated, some analysts had doubts about the outcome and effects on Tata Steels performance. They pointed out that Corus EBITDA (earnings before interest, tax, depreciation and amortization) at 8 percent was much lower than that of Tata Steel which was at 30 percent in the financial year 2006-07 COMPANYS RETURN BEFORE AND AFTER ACQUISITION PRE-ACQUISITION POST-ACQUISITION FINDINGS As we can see from the line chart that the %cumulative abnormal return before acquisition was sharply decreasing since past month with not even a single glimpse of positive return on any single day. But as soon as the acquisition took place, the earnings showed a marginal rise and again got back to the level where it was just before the acquisition. This happened due to very large debt generated due to overpaying by acquiring the Corus at a very high price of 608 pence per share as compared to previously valued 455 pence per share. INTERPRETATION Debt equity ratio on post acquisition increase because Corus debt was high it was GBP1.6b to buy Corus and so its debt is almost 116% more than in pre acquisition. ROCE shows that post acquisition is very less as compared to pre acquisition it has negative percentage because company has short term returns after one year it will improve in the long run. Net profit margin has very less change as profit is not much affected. P/E increases in post acquisition by 30.2% which show high future cash flow. ROE is decreasing by 37.7 which show that it has more debt than equity. EPS has a very minor change. Operating profit margin is reduced by 9.1% which shows that it has low profit. TATA COMMUNICATION-NTT DOCOMO About the acquisition Date: 13th November 2008 Acquirer: Ntt-Docomo Target company: Tata Teleservices Ltd. Stake: 26 % Deal amount: US$ 2700 m Sector: Tele-communication MERGER Tata Teleservices has sold a stake of 26% to Japans NTT DoCoMo. The deal value is $2.7 bn. Tata Tele has 30 million CDMA subscribers and is rolling out its GSM services. Some say the deal is over-valued and some say its not easy to put value on the fastest growing mobile market in the world. India is the fastest growing market second only to China. It adds 10mn subscribers every month. The current subscriber base stands at 300+million and is expected to be 700 million in 2012. That is almost double to todays numbers. The Road ahead Great deal it may be, but it has its risks. One reason is that telecom deals have been controversial in recent times. This goes back to late last year when the government sold pan-India licenses for $333 million apiece, amid a welter of controversy. DoCoMo, in accordance with regulations of the Securities and Exchange Board of India, expects to make an open offer to acquire up to 20 per cent of outstanding equity shares of Tata Teleservices Maharashtra (TTML), a Tata telecommunication company, through a joint tender offer along with Tata Sons. TTSL and TTML through the Tata Indicom brand, have increased their combined share of the fast-growing Indian mobile market and their combined subscriber base now stands at over 30 million. TTSL expects to leverage DoCoMos expertise in the development and delivery of value-added services, where DoCoMo is a firmly established market leader. FINDINGS Debt equity ratio on post acquisition debt is increasing which shows company debt is increasing after merger. ROCE is constant it has not change much.Net profit margin increases by 11.10 as it income increases in post acquisition as compared to pre acquisition. P/E highly increases in post acquisition from 0 to 12%. ROE is decreasing by 1.53% which shows that it slightly more debt than equity. EPS is increasing drastically by 24.27% which is very profitable for investors. Operating profit margin is increased by 15.43% which shows that company profit margin is very fairly profitable. COMPANYS RETURN BEFORE AND AFTER ACQUISITION PRE-ACQUISITION POST-ACQUISITION INTERPRETATION The return of the target company Tata Communication has been very poor since the past 15 to 20 days before the acquisition but it almost got to break-even soon after the acquisition date. This sustained for the next 8 to 10 days but again got back into negative returns zone due to poor customer support to the newly entered Docomo brand in highly competitive communications market in India. TATA MOTOR JLR About the acquisition Date: 27th March 2008 Acquirer: Tata Motors Ltd Target company: Jaguar Land Rover Stake: 100 % Deal amount: US$ 2300m Sector: Automotive Detailed Case Study In June 2008, India-based Tata Motors Ltd. announced that it had completed the acquisition of the two iconic British brands Jaguar and Land Rover (JLR) from the US-based Ford Motors for US$ 2.3 billion. Tata Motors stood to gain on several fronts from the deal. One, the acquisition would help the company acquire a global footprint and enter the high-end premier segment of the global automobile market. After the acquisition, Tata Motors would own the worlds cheapest car the US$ 2,500 Nano, and luxury marquees like the Jaguar and Land Rover. Though there was initial skepticism over an Indian company owning the luxury brands, ownership was not considered a major issue at all. According to industry analysts, some of the issues that could trouble Tata Motors were economic slowdown in European and American markets, funding risks, currency risks etc. The Challenges Morgan Stanley reported that JLRs acquisition appeared negative for Tata Motors, as it had increased the earnings volatility, given the difficult economic conditions in the key markets of JLR including the US and Europe. Moreover, Tata Motors had to incur a huge capital expenditure as it planned to invest another US$ 1 billion in JLR. This was in addition to the US$ 2.3 billion it had spent on the acquisition. Tata Motors had also incurred huge capital expenditure on the development and launch of the small car Nano and on a joint venture with Fiat to manufacture some of the companys vehicles in India and Thailand. This, coupled with the downturn in the global automobile industry, was expected to impact the profitability of the company in the near future CURRENT SCENARIO In less than three years after its acquisition, Jaguar Land Rover has metamorphosed from a millstone around Tata Motors neck into its crowning jewel. In the June 2010 quarter, JLR division accounted for nearly 70% of the companys net profit and over 60% of its revenues on the consolidated basis. This was more than what the market has expected and the stock is up by nearly 150% in the past two trading sessions. JLR benefited from an improvement in its pricing power and a favourable exchange rate in the US dollar and the euro. The two worked in tandem and resulted in a sharp 60% jump in JLR revenue per unit to around  £38,000 in June 2010 quarter compared to the  £23,800 a year ago. With the raw material costs remaining benign, it led to a sharp improvement in the divisions operating margin and its reported net profit of  £221 million (`1,613.3 crore) in the first quarter as against a net loss of  £64 million (`467 crore) a year ago. FINDINGS Debt equity ratio is increasing by 42.27% as Tata took loan of banks to acquire JLR.ROCE increases vey high by 343.60% as compared to pre acquisition as it gauges that company that generate its earnings from the total pool of capital which indicates profitability.Net profit margin increases as it income increases in post acquisition as compared to pre acquisition. P/E highly decreases in post acquisition by 60.1% which in investor point of view they will be profitable to invest to get high earning. ROE is highly increasing by 480.15% which shows that it has more equity than debt. EPS is increasing drastically by 480.15% which is very profitable for investors. Operating profit margin is reduced by 41.44% which shows that company profit margin is very less. COMPANYS RETURN BEFORE AND AFTER ACQUISITION PRE-ACQUISITION POST-ACQUISITION INTERPRETATION As we can see from the line chart that the cumulative return before merger was negative and the entire trend is moving in the negative direction due to poor returns of tata motors. A soon as the acquisition took place, the highly profit generating Jaguar as well as Land Rover added to the profit and earnings of the tata motors. The brand value of JLR added to the highly reputable Tata Group and the companys balance sheet. This can be clearly seen in the line chart above. VALUATION AND INTERPRETATION EV Multiples of Tata Corus Tata Steel and Corus Group deal happened at high multiples compared to its peers. We can observe that the average multiples of the peer group company stands half compared to the deal multiples. Sales Multiple: The average sales multiple of its peers is 1.17x compared to the deal of 0.68x of Corus Groups sales. This can be possible due to high sales value, reducing the multiple to 0.68x. The lowest multiple (Steel Authority of India) is at 0.73x. EBITDA Multiple: EBITDA multiple of its peers averages at 4.38x compared to the deal multiple of 7.02x of Corus Groups sales. Even the highest multiple (Jindal Steel Power) is at 4.38x. This is almost half of the deal multiple. It can be observed that Tata played very aggressively. EBIT Multiple: EBIT multiple of its peers averaged at 5.54x compared to the deal of 10.19x of Corus Groups sales. Even the highest multiple (Jindal Steel Power) is at 8.39x. PE Multiple: The PE multiple of the deal is very high on the account that the margins of Corus are very low compared to Tata Steel and other peers. The average PE multiples is 7.95x compared to 68.23x at which the deal haapened. EV Multiples of Tata NTT Docomo The deal of Tata Teleservices and NTT Docomo happened at very high multiples. We can observe that the average multiples of the peer group company stands very low compared to the deal multiples. Sales Multiple: The average sales multiple of its peers is 5.37x compared to the deal of 26.98x (as on 31st March, 2008) of Tata Teleservicess sales. Even the highest multiple (Reliance Communication) is at 9.24x. Thus we can conclude that Tata Teleservices got very good price for its stake dilution for NTT Docmo. EBITDA Multiple: Again the average EBITDA multiple of its peers is very less, 16.35x compared to the deal of 99.81x (as on 31st March, 2008) of Tata Teleservicess sales. Even the highest multiple (Reliance Communication) is at 26.74x. This is a huge difference. NTT Docomo paid 6 times more what it should have paid to Tata. EBIT Multiple: EBIT multiple of its peers is 25.5x compared to the deal of 952.96x (as on 31st March, 2008) of Tata Teleservicess sales. Even the highest multiple (Reliance Communication) is at 41.02x. PE Multiple: The PE multiple for Tata Teleservices is negative as its net income is negative Note: The multiples are high on account that Sales and the profitability of Tata Teleservices is low, inturn giving very high multiples. Its sales stands at Rs. 1,815.5 Cr. compared to the average sales of Rs. 11,490.6 Cr. of its peers. FINDINGS FROM VALUATION OF ENTERPRISE VALUE MULTIPLE Tata Corus Tata Steel and Corus Group deal happened at high multiples compared to its peers. We can observe that the average multiples of the peer group company stands half compared to the deal multiples. Even the highest multiple (Jindal Steel Power) is at 4.38x. This is almost half of the deal multiple It can be observed that Tata played very aggressively as it paid high enterprise value as compared to our analysis. A reason for Corus to be sold is chance to Bail out of Debt and Financial stress. TATA Steel Paid 7.02 Times EBITDA of Corus Enterprise Value. The PE multiple of the deal is very high on the account that the margins of Corus are very low compared to Tata Steel and other peers the only company who has high P/E is Jindal steel. Tata NTT Docomo The deal of Tata Teleservices and NTT Docomo happened at very high multiples. We can observe that the average multiples of the peer group company stands very low compared to the deal multiples. The average sales multiple of its peers is 5.37x compared to the deal of 26.98x (as on 31st March, 2008) of Tata Teleservicess sales. Even the highest multiple (Reliance Communication) is at 9.24x. Thus we can conclude that Tata Teleservices got very good price for its stake dilution for NTT Docomo. The PE multiple for Tata Teleservices is negative as its net income is negative. EBITDA multiple of its peers is very less, 16.35x compared to the deal of 99.81x (as on 31st March, 2008) of Tata Teleservicess sales. Even the highest multiple (Reliance Communication) is at 26.74x. This is a huge difference. NTT Docomo paid 6 times more what it should have paid to Tata. The multiples are high on account that Sales and the profitability of Tata Teleservices is low, in turn giving very high multiples. Its sales stands at Rs. 1,815.5 Cr. compared to the average sales of Rs. 11,490.6 Cr. of its peers. SUMMARY Except Tata Steel- Corus deal, all the other 2 acquisitions was well accepted by not only well accepted by the owners of the company (the shareholders) but even made the entire Tata group come into the eyes of fortune 500 list. In-fact it ranked at 56th position at a global level in 2009 CONCLUSION This study was undertaken to test what is the impact of mergers on the financials of acquiring corporate by examining some pre- merger and post-merger financial, in terms of impact on operating performance. The results from the analysis of pre- and post-merger operating performance ratios for the acquiring firms in the sample showed that there was a differential impact of mergers, for different industry sectors in India. Type of industry does seem to make a difference to the post-merger operating performance of acquiring firms. Expansion through mergers and acquisition is one of the best ways for any domestic company to step outside the shores of India in an international market place and acquit itself as a global player Company can turn into conglomerate in reasonably less time by capitalizing on its strengths of efficiency and effectiveness by acquiring relatively poor performing companies as TATA did in almost all its group of companies Recent examples of companies which adopted similar pattern of expansion are Renuka Sugars, Arcelor Mittal, Reliance, Essar Group, Aditya Birla Group, etc. One can study any of the above mentioned company and conclude that the key underlying decision of these companies expanding quickly and efficiently is their timely decision of merging and acquiring appropriate companies Impact of Mergers and Acquisitions on the TATA Group Impact of Mergers and Acquisitions on the TATA Group IMPACT OF MERGERS AND ACQUISITIONS ON THE FINANCIALS AND PERFORMANCE OF TATA GROUP In the current globalised economy, mergers and acquisitions are being progressively more used the world over, for increasing competitiveness of companies through gaining better market share, expansion of the portfolio to reduce business risk, to capitalize on the economies of scale and for entering new geographies, etc. This research study was intended to analyze the consequence of going global market through merger and acquisition and traders long and short term earnings .Thereby study the impact of mergers on the financials by examining some pre- merger and post-merger financial ratios, with the sample of firms chosen as three major mergers/acquisitions of TATA Group. The results put forward that there are small variations in terms of post merger financial performance of the joint firm is not considerably different from the aggregate performance of the acquirer and target companies before the merger. INRODUCTION Merger and acquisitions have emerged as chief forces in the contemporary financial and economic environment. They have been a source of corporate growth and in India, it has changed radically after the liberalization of Indian economy. Mergers and acquisitions came up as one of the most efficient methods of such corporate restructuring, and became an essential part of the long-term trade strategy of corporates in India. The sole three chief objectives at the back any MA transaction were found to be: Improving Profitability Rapid growth in scale and closer time to market Acquirement of new technology Many in corporate India would be jealous of the Tata Groups strategy around mergers and acquisition. In the past 8 years, the Tata Group had made 35 overseas acquisitions, including coal and iron ore mines, adding up Rs 78,000 crore, mostly in the past 3 years. Research problem To examine the consequence of going global through mergers and acquisitions and the traders long term and short term earnings respectively. This would aid in studying the impact on companies financials past the merger or acquisition. To also determine the enterprise value of the corporation by comparing it with the peer group and studying the value of the firm Objective of the study To analyze the a thorough detailed case study of 3 companies of Tata Group who merged or acquired in the past years. To evaluate the closing price of 3 companies previous to and post acquisition To weigh up the key financial ratios of 3 companies pre and post acquisition To do valuation of two companies through enterprise value and contrast the value with peer group and examine in detail Review of literature The subsequent studies are the few existing work reviewed which were conducted by researchers in the sight of analyzing the financial performance during and post merger activity across different time periods. Effect of mergers on corporate performance in India, writer Mrs. Vardhana Pawaskar (2001), considered the impact of mergers on corporate performance. A case study, assessed the financial performance of a cloth unit by using ratio analysis. It compared the before and after merger performance of the corporations between 1992 and 2000 to identify their financial character. The study found that the financial fitness was never in the strong zone during the whole study period and ratio analysis highlighted that decision-making incompetence accounted for a good number of the problems. Forecasting the viability and operational efficiency by Mr Mulla through use of ratio analysis, suggested matching up efficiency and success of all facets of management and put the company on a lucrative footing. The study of a sample of firms, restructured through mergers, showed that the merging firms were at the inferior end in terms of liquidity of the industry. The merged firms gave better performance than industry in terms of profitability. Mergers and operating performance by Mr. Mantravadi: An Indian perspective, attempted to examine the impact of mergers on the performance post industrial reforms, by investigating some pre- and post-merger financial ratios, with chosen sample firms, and all mergers linking public and private limited companies The study results suggested that there are minor variations in terms of impact on financial performance of subsequent mergers across different intervals of time in India. It also indicated that for mergers between the same groups of companies in India, there has been deterioration in performance and ROI. Mergers acquisitions in the banking sector presents the Indian scenario, author Mr. Selvam (2007) has analyzed the impacts of stock price changes to mergers and acquisitions behavior taken place in banking industry with particular reference to private and public sector banks. Found that share prices are market sensitive. From the financial analysis it was noted that greater part of the banks went for branch extension and this has affected profitability to some extent and it resulted in harmful competition among the players. To add up the review of literature, many offerings have offered diverse perspectives of merger in different industries globally and explained the valuation techniques followed by merging companies, and shareholders possessions effect due to merger. From the review of several papers evaluating the pre and post merger performance of merged companies, it is incidental that majority of the studies powerfully support the concept of improved post merger performance due to merger and it is valuable to the acquirer companies. METHODOLOGY Methodology of the study Sample selection There are several mergers within the TATA Group during the study period from 01.04.2006 to 31.03.2009. For the purpose of corporate analysis, it was decided to select three of the highest deals which merged/ acquired under the TATA Group during the study period. Hence, the sample size of this study is confined to 3. Besides, while selecting the sample, following points were taken into account. Acquirer and target companies ought to belong to the same industry. Availability of information on the merger and industry. Period of the study The present study covers a period of one year from April 1, 2006 to March 31, 2009. But in order to evaluate the financial performance of sample companies on a comparative basis, 15-20 days before merger and after merger were considered. Sources of data The present study fundamentally depends on secondary data. The required data on financial performance prior and post merger were composed and they were obtained from Prowess software, Internet sources, Business Journals (ICFAI JOURNAL ON M A) The data were also collected from books, and newspapers. Tools used In order to study the financial performance of acquirer and target companies, ratios Debt-Equity Ratio, ROCE (%),net profit margin, P/E, EPS, OPM(%) and valuation. (1) Analysis of financial performance The pre-merger average performance of the companies were compared with the post- merger performance of the joint firm. The present study attempts to calculate and study the pre and post merger performance of acquirer and target companies by using financial ratios in order to determine whether mergers resulted in shareholders wealth or not. Accordingly, the following null hypothesis has been tested: H0: The post merger financial performance of the combined firm is not significantly different from the aggregate performance of the acquirer and target companies prior to the merger. (2) Ratios Debt-Equity Ratio: A gauge of a companys financial leverage obtained by dividing  the total liabilities  by  stockholders equity. It shows what proportion of equity and debt the company is presently using to finance their assets. Return On Capital Employed (ROCE) : ROCE compares earnings with the invested capital in the company. It is like Return on Assets (ROA), but also considers sources of financing Net profit margin: The profit margin says how much profit a company makes for every 1 Rupee it generates in revenue or sales. Profit margins vary with industry to industry, but all else being equal, the greater a companys profit margin compared to its competitors, the better. P/E: It is a gauge of the price paid for a share relative to the annual net income or the net profit earned by the firm per share. EPS: The portion of a companys profit which is allocated to each outstanding share of common stock.  Earnings per share  acts as an indicator of  a companys profitability. OPM: Operating margin is a measurement of the proportion of a companys revenue that is left over after variable costs of production such as wages, and raw materials have been paid. A healthy operating margin is required for a company to be able to pay for its fixed costs, such as interest on debt. Also known as operating profit margin and net profit margin. (3) Enterprise Value Enterprise value is a figure that, in theory, represents the entire cost of a company if someone were to acquire it. Enterprise value is a more accurate estimate of takeover cost than market capitalization because it takes includes a number of important factors such as preferred stock, debt, and cash reserves that are excluded from the latter metric. ANALYSIS OF DATA TATA GROUP OF COMPANIES One of the Indias largest business groups in the country. It has about 96 operating companies. Diverse business in 7 sectors. Revenues equivalent to 5.3% of Indias GDP. Group revenue FY 2008: Rs 251,543 Cr. / $ 62.5 b. Group profit FY 2008: Rs 21,578 Cr. / $ 5.4 b .Its 27 publicly listed companies have a combined market capitalization which is the 2nd highest among all business houses in India. Largest employer in private sector over 300,000 employees. A shareholder base of over 2.9 million. Operations in over 80 countries. Products and services exported to 85 countries Tata is a rapidly growing business group based in India with significant international operations. Revenues in 2007-08 are estimated at $62.5 billion (around Rs251, 543 crore), of which 61 per cent is from business outside India. The group employs around 350,000 people worldwide. The Tata name has been respected in India for 140 years for its adherence to strong values and business ethics. The business operations of the Tata group currently encompass seven business sectors: communications and information technology, engineering, materials, services, energy, consumer products and chemicals. The groups major companies are beginning to be counted globally. Considering two of the largest mergers of TATA Group -Tata Steel became the sixth largest steel maker in the world after it acquired Corus. -Tata Communications is a leading global provider of a new world of communications. With a leadership position in emerging markets, Tata Communications leverages its advanced solutions capabilities and domain expertise across its global and pan-India network to deliver managed solutions to multi-national enterprises, service providers and Indian consumers. TATA STEEL-CORUS About the acquisition Date: 30th March 2007 Acquirer: Tata Steel Limited Target company: Corus Plc. Stake: 100 % Deal amount: US$ 12201 m Sector: Steel sector MERGER On January 31, 2007, India based Tata Steel Limited (Tata Steel) acquired the Anglo Dutch steel company, Corus Group Plc (Corus) for US$ 12.20 billion. The merged entity, Tata-Corus, employed 84,000 people across 45 countries in the world. It had the capacity to produce 27 million tons of steel per annum, making it the fifth largest steel producer in the world as of early 2007. Before the acquisition, the major market for Tata Steel was India. The Indian market accounted for sixty nine percent of the companys total sales. Almost half of Corus production of steel was sold in Europe (excluding UK). The UK consumed twenty nine percent of its production. After the acquisition, the European market (including UK) would consume 59 percent of the merged entitys total production. DEAL : An auction was initiated on January 31, 2007, and after nine rounds of bidding, TATA Steel could finally clinch the deal with its final bid 608 pence per share, almost 34% higher than the first bid of 455 pence per share of Corus. Synergies There were many likely synergies between Tata Steel, the lowest-cost producer of steel in the world, and Corus, a large player with a significant presence in value-added steel segment and a strong distribution network in Europe. Among the benefits to Tata Steel was the fact that it would be able to supply semi-finished steel to Corus for finishing at its plants, which were located closer to the high-value markets The Pitfalls Though the potential benefits of the Corus deal were widely appreciated, some analysts had doubts about the outcome and effects on Tata Steels performance. They pointed out that Corus EBITDA (earnings before interest, tax, depreciation and amortization) at 8 percent was much lower than that of Tata Steel which was at 30 percent in the financial year 2006-07 COMPANYS RETURN BEFORE AND AFTER ACQUISITION PRE-ACQUISITION POST-ACQUISITION FINDINGS As we can see from the line chart that the %cumulative abnormal return before acquisition was sharply decreasing since past month with not even a single glimpse of positive return on any single day. But as soon as the acquisition took place, the earnings showed a marginal rise and again got back to the level where it was just before the acquisition. This happened due to very large debt generated due to overpaying by acquiring the Corus at a very high price of 608 pence per share as compared to previously valued 455 pence per share. INTERPRETATION Debt equity ratio on post acquisition increase because Corus debt was high it was GBP1.6b to buy Corus and so its debt is almost 116% more than in pre acquisition. ROCE shows that post acquisition is very less as compared to pre acquisition it has negative percentage because company has short term returns after one year it will improve in the long run. Net profit margin has very less change as profit is not much affected. P/E increases in post acquisition by 30.2% which show high future cash flow. ROE is decreasing by 37.7 which show that it has more debt than equity. EPS has a very minor change. Operating profit margin is reduced by 9.1% which shows that it has low profit. TATA COMMUNICATION-NTT DOCOMO About the acquisition Date: 13th November 2008 Acquirer: Ntt-Docomo Target company: Tata Teleservices Ltd. Stake: 26 % Deal amount: US$ 2700 m Sector: Tele-communication MERGER Tata Teleservices has sold a stake of 26% to Japans NTT DoCoMo. The deal value is $2.7 bn. Tata Tele has 30 million CDMA subscribers and is rolling out its GSM services. Some say the deal is over-valued and some say its not easy to put value on the fastest growing mobile market in the world. India is the fastest growing market second only to China. It adds 10mn subscribers every month. The current subscriber base stands at 300+million and is expected to be 700 million in 2012. That is almost double to todays numbers. The Road ahead Great deal it may be, but it has its risks. One reason is that telecom deals have been controversial in recent times. This goes back to late last year when the government sold pan-India licenses for $333 million apiece, amid a welter of controversy. DoCoMo, in accordance with regulations of the Securities and Exchange Board of India, expects to make an open offer to acquire up to 20 per cent of outstanding equity shares of Tata Teleservices Maharashtra (TTML), a Tata telecommunication company, through a joint tender offer along with Tata Sons. TTSL and TTML through the Tata Indicom brand, have increased their combined share of the fast-growing Indian mobile market and their combined subscriber base now stands at over 30 million. TTSL expects to leverage DoCoMos expertise in the development and delivery of value-added services, where DoCoMo is a firmly established market leader. FINDINGS Debt equity ratio on post acquisition debt is increasing which shows company debt is increasing after merger. ROCE is constant it has not change much.Net profit margin increases by 11.10 as it income increases in post acquisition as compared to pre acquisition. P/E highly increases in post acquisition from 0 to 12%. ROE is decreasing by 1.53% which shows that it slightly more debt than equity. EPS is increasing drastically by 24.27% which is very profitable for investors. Operating profit margin is increased by 15.43% which shows that company profit margin is very fairly profitable. COMPANYS RETURN BEFORE AND AFTER ACQUISITION PRE-ACQUISITION POST-ACQUISITION INTERPRETATION The return of the target company Tata Communication has been very poor since the past 15 to 20 days before the acquisition but it almost got to break-even soon after the acquisition date. This sustained for the next 8 to 10 days but again got back into negative returns zone due to poor customer support to the newly entered Docomo brand in highly competitive communications market in India. TATA MOTOR JLR About the acquisition Date: 27th March 2008 Acquirer: Tata Motors Ltd Target company: Jaguar Land Rover Stake: 100 % Deal amount: US$ 2300m Sector: Automotive Detailed Case Study In June 2008, India-based Tata Motors Ltd. announced that it had completed the acquisition of the two iconic British brands Jaguar and Land Rover (JLR) from the US-based Ford Motors for US$ 2.3 billion. Tata Motors stood to gain on several fronts from the deal. One, the acquisition would help the company acquire a global footprint and enter the high-end premier segment of the global automobile market. After the acquisition, Tata Motors would own the worlds cheapest car the US$ 2,500 Nano, and luxury marquees like the Jaguar and Land Rover. Though there was initial skepticism over an Indian company owning the luxury brands, ownership was not considered a major issue at all. According to industry analysts, some of the issues that could trouble Tata Motors were economic slowdown in European and American markets, funding risks, currency risks etc. The Challenges Morgan Stanley reported that JLRs acquisition appeared negative for Tata Motors, as it had increased the earnings volatility, given the difficult economic conditions in the key markets of JLR including the US and Europe. Moreover, Tata Motors had to incur a huge capital expenditure as it planned to invest another US$ 1 billion in JLR. This was in addition to the US$ 2.3 billion it had spent on the acquisition. Tata Motors had also incurred huge capital expenditure on the development and launch of the small car Nano and on a joint venture with Fiat to manufacture some of the companys vehicles in India and Thailand. This, coupled with the downturn in the global automobile industry, was expected to impact the profitability of the company in the near future CURRENT SCENARIO In less than three years after its acquisition, Jaguar Land Rover has metamorphosed from a millstone around Tata Motors neck into its crowning jewel. In the June 2010 quarter, JLR division accounted for nearly 70% of the companys net profit and over 60% of its revenues on the consolidated basis. This was more than what the market has expected and the stock is up by nearly 150% in the past two trading sessions. JLR benefited from an improvement in its pricing power and a favourable exchange rate in the US dollar and the euro. The two worked in tandem and resulted in a sharp 60% jump in JLR revenue per unit to around  £38,000 in June 2010 quarter compared to the  £23,800 a year ago. With the raw material costs remaining benign, it led to a sharp improvement in the divisions operating margin and its reported net profit of  £221 million (`1,613.3 crore) in the first quarter as against a net loss of  £64 million (`467 crore) a year ago. FINDINGS Debt equity ratio is increasing by 42.27% as Tata took loan of banks to acquire JLR.ROCE increases vey high by 343.60% as compared to pre acquisition as it gauges that company that generate its earnings from the total pool of capital which indicates profitability.Net profit margin increases as it income increases in post acquisition as compared to pre acquisition. P/E highly decreases in post acquisition by 60.1% which in investor point of view they will be profitable to invest to get high earning. ROE is highly increasing by 480.15% which shows that it has more equity than debt. EPS is increasing drastically by 480.15% which is very profitable for investors. Operating profit margin is reduced by 41.44% which shows that company profit margin is very less. COMPANYS RETURN BEFORE AND AFTER ACQUISITION PRE-ACQUISITION POST-ACQUISITION INTERPRETATION As we can see from the line chart that the cumulative return before merger was negative and the entire trend is moving in the negative direction due to poor returns of tata motors. A soon as the acquisition took place, the highly profit generating Jaguar as well as Land Rover added to the profit and earnings of the tata motors. The brand value of JLR added to the highly reputable Tata Group and the companys balance sheet. This can be clearly seen in the line chart above. VALUATION AND INTERPRETATION EV Multiples of Tata Corus Tata Steel and Corus Group deal happened at high multiples compared to its peers. We can observe that the average multiples of the peer group company stands half compared to the deal multiples. Sales Multiple: The average sales multiple of its peers is 1.17x compared to the deal of 0.68x of Corus Groups sales. This can be possible due to high sales value, reducing the multiple to 0.68x. The lowest multiple (Steel Authority of India) is at 0.73x. EBITDA Multiple: EBITDA multiple of its peers averages at 4.38x compared to the deal multiple of 7.02x of Corus Groups sales. Even the highest multiple (Jindal Steel Power) is at 4.38x. This is almost half of the deal multiple. It can be observed that Tata played very aggressively. EBIT Multiple: EBIT multiple of its peers averaged at 5.54x compared to the deal of 10.19x of Corus Groups sales. Even the highest multiple (Jindal Steel Power) is at 8.39x. PE Multiple: The PE multiple of the deal is very high on the account that the margins of Corus are very low compared to Tata Steel and other peers. The average PE multiples is 7.95x compared to 68.23x at which the deal haapened. EV Multiples of Tata NTT Docomo The deal of Tata Teleservices and NTT Docomo happened at very high multiples. We can observe that the average multiples of the peer group company stands very low compared to the deal multiples. Sales Multiple: The average sales multiple of its peers is 5.37x compared to the deal of 26.98x (as on 31st March, 2008) of Tata Teleservicess sales. Even the highest multiple (Reliance Communication) is at 9.24x. Thus we can conclude that Tata Teleservices got very good price for its stake dilution for NTT Docmo. EBITDA Multiple: Again the average EBITDA multiple of its peers is very less, 16.35x compared to the deal of 99.81x (as on 31st March, 2008) of Tata Teleservicess sales. Even the highest multiple (Reliance Communication) is at 26.74x. This is a huge difference. NTT Docomo paid 6 times more what it should have paid to Tata. EBIT Multiple: EBIT multiple of its peers is 25.5x compared to the deal of 952.96x (as on 31st March, 2008) of Tata Teleservicess sales. Even the highest multiple (Reliance Communication) is at 41.02x. PE Multiple: The PE multiple for Tata Teleservices is negative as its net income is negative Note: The multiples are high on account that Sales and the profitability of Tata Teleservices is low, inturn giving very high multiples. Its sales stands at Rs. 1,815.5 Cr. compared to the average sales of Rs. 11,490.6 Cr. of its peers. FINDINGS FROM VALUATION OF ENTERPRISE VALUE MULTIPLE Tata Corus Tata Steel and Corus Group deal happened at high multiples compared to its peers. We can observe that the average multiples of the peer group company stands half compared to the deal multiples. Even the highest multiple (Jindal Steel Power) is at 4.38x. This is almost half of the deal multiple It can be observed that Tata played very aggressively as it paid high enterprise value as compared to our analysis. A reason for Corus to be sold is chance to Bail out of Debt and Financial stress. TATA Steel Paid 7.02 Times EBITDA of Corus Enterprise Value. The PE multiple of the deal is very high on the account that the margins of Corus are very low compared to Tata Steel and other peers the only company who has high P/E is Jindal steel. Tata NTT Docomo The deal of Tata Teleservices and NTT Docomo happened at very high multiples. We can observe that the average multiples of the peer group company stands very low compared to the deal multiples. The average sales multiple of its peers is 5.37x compared to the deal of 26.98x (as on 31st March, 2008) of Tata Teleservicess sales. Even the highest multiple (Reliance Communication) is at 9.24x. Thus we can conclude that Tata Teleservices got very good price for its stake dilution for NTT Docomo. The PE multiple for Tata Teleservices is negative as its net income is negative. EBITDA multiple of its peers is very less, 16.35x compared to the deal of 99.81x (as on 31st March, 2008) of Tata Teleservicess sales. Even the highest multiple (Reliance Communication) is at 26.74x. This is a huge difference. NTT Docomo paid 6 times more what it should have paid to Tata. The multiples are high on account that Sales and the profitability of Tata Teleservices is low, in turn giving very high multiples. Its sales stands at Rs. 1,815.5 Cr. compared to the average sales of Rs. 11,490.6 Cr. of its peers. SUMMARY Except Tata Steel- Corus deal, all the other 2 acquisitions was well accepted by not only well accepted by the owners of the company (the shareholders) but even made the entire Tata group come into the eyes of fortune 500 list. In-fact it ranked at 56th position at a global level in 2009 CONCLUSION This study was undertaken to test what is the impact of mergers on the financials of acquiring corporate by examining some pre- merger and post-merger financial, in terms of impact on operating performance. The results from the analysis of pre- and post-merger operating performance ratios for the acquiring firms in the sample showed that there was a differential impact of mergers, for different industry sectors in India. Type of industry does seem to make a difference to the post-merger operating performance of acquiring firms. Expansion through mergers and acquisition is one of the best ways for any domestic company to step outside the shores of India in an international market place and acquit itself as a global player Company can turn into conglomerate in reasonably less time by capitalizing on its strengths of efficiency and effectiveness by acquiring relatively poor performing companies as TATA did in almost all its group of companies Recent examples of companies which adopted similar pattern of expansion are Renuka Sugars, Arcelor Mittal, Reliance, Essar Group, Aditya Birla Group, etc. One can study any of the above mentioned company and conclude that the key underlying decision of these companies expanding quickly and efficiently is their timely decision of merging and acquiring appropriate companies