Coastal Management Report: Collaroy Beach Essay

The Issue Coastal management is the dealings surrounding the management of development along the coastline with sustainability- being able to meet the needs of future generalizations while capitalizing the use of desired areas of the coasts for residential and commercial purposes. My written report on coastal management will revolve around the main issue explored in our field trip which is the gradual erosion of the foredune on Collaroy beach, and its effects on stakeholders (incl. residents, developers, specialist groups). This report will also include the decision making processes considered by the management (both local and state), as well as the descriptions of their actions/strategies, and thus the results of their policies. The LocationOur site of interest, Collaroy beach is located in the suburbs of Northern Sydney, in the state of New South Wales, Australia. Collaroy is part of the local government area of Warringah Council and part of the Northern Beaches region. Collaroy is well known for its excellent surf beach which joins with Narrabeen Beach in the north and Long Reef and Dee Why Beach in the south. Also in close proximity is the Dee Why Lagoon as well as the Long Reef Head. Collaroy beach is the most highly capitalized shoreline in the Warringah local government area, featuring beachfront houses and apartments built on the edge of the sand including the famous Flight Deck Apartments. Geographical ProcessCoastal erosion is the loss of land along the shoreline due to the natural removal of beach and dune material in response to changing wave and water conditions. Buildings and facilities located within the ‘active’ beach system, or areas subject to coastal erosion can be undermined and may even collapse. Approximately 60 percent of the NSW open coastline is characterised by sandy beaches. These beaches are dynamic environments undergoing continual cycles  of erosion and accretion in response to the action of tides, wind and waves. In many places, existing foreshore development has been built within the ‘active’ beach system and is at risk from coastal erosion. The extent of beach erosion during a particular storm event depends upon a variety of factors that include:†¢The wave conditions and elevated water levels generated by the stormThe most prominent of these processes involves waves and the currents that they generate, along with tides Waves are generated by wind blowing over a body of water and are ultimately responsible for the construction and erosion, as well as transportation of beach sediments. Waves are classified into two groups: swell waves or sea waves. The incoming tide of a wave is called a swash while the outgoing tide is called a backwash. Swell waves are more powerful and cause erosion, whereas sea waves are less violent and encourage deposition. Large swell waves are usually accompanied by a storm, and the swell may become big enough to be classified as a ‘king tide’. A king tide’ arrives at Narrabeen-Collaroy Beach once or twice annual and has a devastating effect on the beach, eroding the beach until a near vertical erosion scarp is exposed. The sand than is deposited offshore to form a sand bar. Immediately following coastal erosion events on sand beaches, a near vertical erosion scarp of substantial height can be left. If buildings are located close to the vertical erosion scarp, they may be at-risk of structural damage. Instability of the escarpment may pose a hazard to beach users following storms with recorded instances of children and beach users buried by the collapsing sand face. †¢The presence of rip cellsA rip cell is a area with a strong surface flow of water returning seaward from near the shore). It is often called a â€Å"rip tide† However along with water returning seaward, much of the beach sediments are eroded as well helping to hasten the process of erosion. †¢The condition of the beachThe condition of the beach is also a factor in the severity of the erosion. The condition of the beach is determined by the amount of erosion that has occurred on the beach at that state of time. One indicator of condition is the identification of the beach profile. A beach which possesses a relatively large amounts of sand in the incipient dune, as well the stability of the fore dune, are in a pre-storm form. A beach that has been recently eroded by a storm has a storm profile. The features of a storm profile are the erosion of incipient dune and the exposure of the near vertical erosion scarp, near the fore dune of the beach, as well as a large offshore bar. This beach would therefore have a storm profile. A beach in which the sea waves have gradually restored the sand to the incipient dune from the sandbar, as well a stable fore-dune are the tell-tell signs of a post-stormprofile. A beach which is in better conditions is more suited to fight sand erosion, while a ‘second wind’ of a storm after the beach being in a storm profile could be devastating for the beach. †¢The condition of dune vegetation which can influence the volume of sand in the dunes which help to buffer the effects of storm erosionStable sand dunes play an important part in protecting the coastline. They act as a buffer against wave damage during storms, protecting the land behind from salt-water intrusion. This sand barrier allows the development of more complex plant communities in areas protected from salt-water inundation, sea spray and strong winds. The dunes also act as a reservoir of sand, to replenish and maintain the beach at times of erosion. When people build homes or resorts on beaches, the buildings interrupt this natural process because the sand that is usually taken by storms is removed so that humans may build. In the diagram below the red line shows the extent of the danger zone. Key Interest GroupsThe key interest groups involved with the issue of the erosion of Collaroy include groups such as Sydney Coastal Councils Groups, which have criticize the non-actions of the Warringah Council to set up a plan in the long term, instead focusing on short term relief such as sand replenishment, which SSCG deems as unsustainable in the long run. However,  SSCG may be the only interest group targeting the issue. However when it was announced that the sea wall was planned for construction two tother peer groups, Surf rider Foundation Club, as well as the local Collaroy Surf Club joined in action to stop the construction of the seawall. Decision Making ProcessTo find a solution for the erosion of Collaroy Beach was a complicated process involving decision making and assistance in many levels. The NSW and Commonwealth government provided assistance to Warringah Council by providing material to help it construct an effective Management Strategy. Material included in this state and commonwealth package Included 1990 the NSW Government released its Coastline Management Manual, a guideline to help local council’s development, Coastal management plan by them. It also provided Commonwealth inquires such as reported on’ The Injured Coastline’ and’ The Coastal Zone Inquiry’. In 1993 the Warringah Council set up the Warringah Coastal Committee which has various stakeholders as members including: a WC councillor, A NSW Govt Rep, a Surfrider Rep, a SLSC Rep, Beachfront and other Local residents. This diversity in the committee instead of just containing members of the council helped to foster unbiased views on the opinions of the stakeholders as well increase the community involvement which helps to better serve the purpose of the community, making the ideas of the community in which is ultimately the council’s purpose anyway. The Committee meets once every two months to advice Council on the next action to stop the erosion. In August 1997 the Collaroy/Narrabeen Coastal Management Plan was adopted. Throughout this process and before any major strategies are implemented the public are invited to comment and provide community feedback. However there have been criticisms of the committee as consensus-based Coastline Management Plan was pursued by Council but not achieved, with strong differences of opinion emerging within the community, and between the Warringah Coastal Management Committee and CouncilManagement Actions and Strategies (and Consequences) There have been many different  management strategies that could have been implemented to protect from or at least slow down the effects of erosion, enough to guarantee the safety of the dwelling. Preliminary studies reviled that the existing rock seawalls are not strong enough to withstand a major storm. There are two long term solutions to this issue. They are voluntary purchase of high risk dwellings, and the protection of the beach through the building of a seawall or an artificial surf reef. The community is split between those strategies for tackling the erosion problemA temporary solution involve minor to moderate sand nourishment, which are used in conjunction with either of these actions. The sand comes from the mouths of the Dee Why and Narrabeen Lagoons. The management strategy of repurchasing high risk single homes has been a popular strategy amongst those whom want to protect and enhanced the recreational amenity of the beach. This method was successful back in 1945 when the council bought back 7 houses that were damaged by the storm. However in recent years, the price of beachside property skyrocketed with high demand, and the strategy is currently not economically feasible at this point in time. With an average home in 2005 located on the fore dune of Collaroy Beach coasting a whopping 2.7 million- the plan is estimated to cost more than 100 million dollars. Even though the state government is willing to match the contributions the state government made, this strategy if implemented could take anywhere between 50 to 100 years to purchase every single home that is in the high risk zone. The alternative strategy is to develop a seawall on the beach to protect the property located on the fore dune. The sea wall would be approximately 1 km long and will be sufficient to protect the fore dune from collapsing. However the cost of the sea wall cheap in comparison to the ‘repurchase’ strategy costs approximately 11 million dollars to build. In addition, the council expects at least 40% of the 11 million to be paid by the owners of the units, making it an unattractive deal for the residents. The seawall is also not environmentally friendly either. It is known for speeding up the process of erosion, as the energy of the storm waves is not absorbed but reflected, meaning the backwash will be stronger, and eventually the shore profile will retreat, removing what’s left of the beach. However this idea  also seems to be out of reach, as after the successful â€Å"Line in the Sand† community protest in November 2002, the council voted 4 months later not to proceed with the sea wall option. So with the ‘repurchase’ strategy unlikely, and the seawall not likely to be built, how is the council going to solve the problem. Right now, the plan is to get by on minor beach nourishment from the mouth of Narrabeen and Dee Why Lagoons for now, while the council investigates new strategies, with the help of newly implemented coastal imaging cameras on top of Flight Deck. One of the new strategies being investigated includes an artificial surfing reef, which is basically a seawall underneath the water to amplify the surf. Acting like a ramp, it pushes waves upwards which increases their size and shapes them into waves you can surf. This also reduces the impact of the swell waves, reducing the rate of erosion. However, this technology is quite new and it is debateable in its affectivity, but the results are promising, and it is also drastically cheaper than the original strategies, making it a viable solution for the ongoing problem in a number of years time. (The diagram below shows an artificial surf reef) www.examplessays.com www.coastalmananagment.com www.megaessays.com

Promotion Mix Tools

promotion mix tools The promotion ( Promotional Mix ) is one out of four basic instruments of marketing that has the purpose to inform about other instruments of marketing mix and to contribute to sales increase on the long term. The promotional mixis always serving to specific goal. These goals can be public informing, demand increasing, product differentiation, and product value increasing or sales stabilizing. Usually the promotion is targeting more than one goal.Promotion is the process of communication between the company that sells the product and the potential customer, with the purpose of influencing the attitudes and behavior. There are specific promotional tool that are supporting chosen promotional goal. The promotional mix represents a combination of different promotional tools. The basic elements of promotional mix are Advertising, Public Relationship, Personal Sales and Sales Promotion. Advertising is communication with current and potential customers and consumers, don e through paid mass media. The channels of communication can be TV, radio, Internet, billboards, etc. * Public Relationship ( PR ) is communication toward public, but is turned more to reputation and image of the company, than to it's products. The PR activity can be a press conference, TV interview with company representative,   press article about donation of the company to charity or about latest environmental project. Personal Sales is a way of promotion activity where sales representative is directly contacting the customer. This person-to-person contact has the goal of direct promotion of the product and conclusion of sales. * Sales Promotion represents a set of different promotional activities that has the goal of animating customers for purchasing. This can be value offer ( discount ), quantity offer ( 2+1 ), prize drawings, merchandising, direct contact by animators in retail outlet, etc.

Analysing the impact of Chinese FDI in Africa: A case study of Nigeria and Ghana.

INTRODUCTIONResearch ProblemThe proposed research aims to examine the effect of Chinese Foreign Direct Investment (FDI) in Ghana and Nigeria in order to perform a cross-country analysis of the respective impacts of such investments in these countries. Ghana and Nigeria share a number of similar characteristics, which make for a useful comparison, as it is posited in this study that the similarities between the two African countries will allow for a cross-national comparison of the impacts of Chinese FDI in these countries. The results of the analysis will be used to make recommendations on how Ghana and Nigeria should make appropriate use of China’s FDI to achieve development in these countries. Analyzing the impact of Chinese FDI in Ghana and Nigeria has been the topic of some academic research. However, previous studies have focused on the individual relationships between these African countries and China (SWAC/OECD, 2011). With the rapid changes in the global investment environment, especially in light of the global recession, it is essential to identify the key determining factors of FDI inflows to Ghana and Nigeria, in order to analyze the impact of these FDIs in this region. Although economic growth has been specified as a developmental goal in this region, academic research exploring the nature of the economic relationship between China and Ghana / China and Nigeria suggests that the influx of FDI into these developing economies may have the effect of retarding the overall development in these countries, as it prioritizes the exploitation of natural resources over essential developmental goals (Oyeranti, et al., 2010).Aims and ObjectivesThis research has two main goal s. First is to assess the impacts of Chinese FDI in Ghana and Nigeria in order to conduct a cross-country analysis of their respective economic relationships. Second is to analyze the overall impact of Chinese FDI on the development of these countries. In order to realize the primary goals of this study, the following objectives have been identified: To establish a theoretical framework for analyzing the impacts of FDI in developing countries, specifically within the context of countries in the West African which have abundant natural resources To construct a theoretical framework for measuring the impacts of FDI in Ghana and Nigeria, taking into consideration the differences in economic development and investment climate. To determine the factors influencing the economic relationship between China and Ghana / China and Nigeria, and to analyze these in terms of the established framework. To compare and contrast the respective impacts of Chinese FDI on Ghana and Nigeria in order to draw conclusions regarding how to manage and improve their relationshipsResearch QuestionsA set of research questions has been formulated based on the main goals and objectives of the study. These questions help to guide the study by ensuring that the analysis stays focused on the primary research subject. Below are the research questions for this study : What are the determinants of FDI impacts in African countries and how are these measured What are the specific impacts of Chinese FDI in Ghana and Nigeria How do these impacts correlate with the determinants identified in question 1 To what extent are the impacts of Chinese FDI in Ghana and Nigeria comparable What cross-country recommendations can be made in order to ensure that developmental goals and positive determinants of FDI are achieved in both countriesBackground informationDue to rapid globalization and the growing interdependence among countries, FDI has been recognized as one of the most significant means of international capital transfers. Over the years, FDI has grown to be an essential component in the economic development of many nations (Benacek et. al., 2000). Morgan (2003) and Johnson (2005) have highlighted the beneficial impacts that FDI can provide to a host country. These include: (a) generating additional resources such as capital and technology, to help boost the level of domestic outputs and deliver better, more affordable goods and services; (b) outflow of human resources, management practices and technologies from foreign firms to domestic businesses , which enables the host country to improve their operations and competitiveness; and (c) increased involvement of the host country in transnational markets, such as foreign exchange market and international trade. Due to the economic growth and welfare that FDI brings to the host country, this investment is preferred by most developing countries because it offers a faster way to achieve a more advanced level of economic development. However, FDI presents a lot of risks for investors. Due to these risks, countries are compelled to offer tangible incentives, as well as to put supportive regulation and systems in place to draw investors. Unfortunately, most developing nations frequently neglect to build an incentive system for foreign financiers (Botric & Skuflic, 2005). Consequently, the bulk of FDI is offered to developed countries such as the US, Germany, and Belgium (UNCTAD, 2011a). Traditionally, investment relationships in Ghana and Nigeria are established with European and American investment partners, as these countries are the primary sources of FDI, trade, and financial and technical aid. These relationships involve a number of bilateral and regional agreements with Nigeria and Ghana. Despite the many years of economic relationships with these countries, there are still differing opinions as to the impact of these investments on the development of Ghana and Nigeria (Tsikata, et al., 2010). FDI in Africa has been increasing steadily since 2002 with approximately $53 billion worth of FDI in 2007, representing an increase from 2006 of 47.2%. This increase was the highest recorded level of FDI in Africa at the time. With the global recession, the percentage of global FDI into Africa has experienced a significant decline from 3.2% in 2006 to 2.9% in 2007. Since then, however, the African economy has proved resilient, growing to over $61.9 billion in 2008, and the rate of return on FDI in Africa since 2004 has grown to 12.1%. In addition, mergers and acquisitions in Africa have risen by approximately 157% to $2 billion in 2008 (Oyeranti, et al., 2010). Investment in Nigeria and Ghana by Chinese investors has grown substantially since 1971 as a result of the complementary nature of their economies. Chinese investment in Ghana has been growing consistently in the previous decade with significant increase seen from 2004 to 2005, representing $3.09 million and $17.87 million, respectively. Research indicates that the Chinese share, as a percentage of total investment by China in Ghana, implies that FDI is increasing (Frimprong, 2012). Investment by the Chinese in Nigeria reveals a similar situation, as Chinese FDI grew twice as much between 2003 and 2005, increasing from $3 billion to $6 billion. Ghana and Nigeria lack significant investments in infrastructure that is needed to support the development required to result in measurable economic growth. To this end, China has developed a successful and competent construction industry, coupled with the ability to provide Nigeria and Ghana with the requisite capital needed to drive this infrastructure development (Oyeranti, et al., 2010). In this way, the flow of investment into Ghana and Nigeria is complementary due to the nature and needs of the respective economies. However, the Chinese industrialization drive and the subsequent inflow of FDI into China’s economy has led to rapid growth in the manufacturing sector, which entails the use of oil and mineral inputs that are overwhelming China’s internal resource capabilities (Ibid). As a result, China is looking to developing nations such as Nigeria and Ghana to supplement their energy resource requirements to support their growing economy. Consequently, the relation ship between Chinese FDI inflows into Ghana and Nigeria are being described as exploitative and as having an upsetting effect on the Western development goals that have been set for the region (Tsikata, et al., 2010). This negative perception about China’s interest in Nigeria and Ghana are due to the fact that the oil and gas sector accounts for more than 75% of Chinese investments. This implies that China seeks to exploit Nigeria’s natural resources. This further suggests that Chinese FDI in Nigeria is a relationship prone to exploitation and is potentially damaging to the developmental goals of the region (Oyeranti, et al., 2010). Despite these negative views, Chinese FDI in Nigeria and Ghana has not been focused solely on the exploitation of natural resources. Chinese FDI has actually helped to achieve significant growth in the manufacturing and services industry in both countries (Frimpong, 2012). The investment climate in Africa has become significantly more attractive as a result of the considerable efforts to liberalize investment regulations and offer incentives for FDI. The result, however, has not been as positive as originally intended due to significant concerns over the economic and political stability of the region. LITERATURE REVIEWFDI definitionThe analysis of relevant literature has shown that there is not one universally recognized definition of FDI. Nevertheless, the various definitions of FDI do not differ considerably. FDI is commonly perceived as either a real phenomenon or a financial phenomenon (Moosa, 2002). Within the perspective of a financial phenomenon, FDI is defined as: A kind of transnational investment transfer; wherein FDI is the outcome of variations in interest rates between two economies, because the country with higher interest levels is more appealing for foreign businesses An external supply of funding for the national economy ? FDI shows the influxes of foreign investment into the nation within a certain timeframe, which is indicated in the balance of payments A means of reducing and eventually eradicating poverty through FDI-driven economic growth in developing countries, and in Africa, specifically in light of United Nations Millennium Development Goals (MDG) (Asiedu, 2006) However, when FDI is considered exclusively in financial terms, there seems to be an underestimation of the degree to which FDI is related with a varied array of production elements. Among the most crucial non-financial inflows are managerial skills, expertise, and technology. This implies that although financial flows seem to a main component of FDI, it is not necessarily the leading element. Furthermore, according to Moosa (2002) a distinctive characteristic of FDI compared with other kinds of international investments is its function in directing management policies and decisions. As such, describing FDI as purely a financial phenomenon appears to undervalue this aspect. A more inclusive definition of FDI that is mostly acknowledged by other international organizations (e.g. IMF, Eurostat, UNCTAD) is proposed by OECD. According to the OECD (1999, p.7), FDI ’reflects the aim of obtaining a lasting interest by a resident entity of one economy (direct investor) in an enterprise that is resident of another economy (direct investment enterprise).’ The term ’lasting interest’ refers to the formation of a long-standing association concerning the investor and the direct investment establishment This also involves important impacts on the management of such enterprise. A direct investor is ’the owner of 10% or more of ordinary shares or voting stock‘(OECD, 1999, p.8). The IMF recommends applying this requirement of a minimum 10% ownership to differentiate direct investment vis-a-vis portfolio investment through shareholding. Based from this perspective, a direct investor can be any of the following entities: (a) individual, (b) group of associated individuals, (c) government, (d) incorporated or unincorporated company, private or public, and (e) group of associated companies, incorporated or unincorporated. The entity has a direct investment establishment situated in a country that is not where the direct investor resides (Duce, 2003). Direct investment enterprise can have any of the subsequent forms: Subsidiary ? a direct investor controls greater than 50% of the voting power allocated to shareholders. Controlling the shareholdings can be done either directly or indirectly, via a different subsidiary. The direct investor has the authority to secure or terminate members of the Supervisory Board or Management Board. Associate Company ? a direct investor owns between 10 to 50 % of the voting power allocated to shareholders. Likewise the control of shareholdings can be done either directly or indirectly. Branch ? a direct investor is also the owner of an unincorporated establishment (whole or joint ownership) in the host country. This can be in several forms, such as a joint venture, an unincorporated partnership, or a permanent office for the direct investor. This may also be in the form of fixed/immobile equipment, movable equipment, property, or constructions located in the host country (OECD, 1999). Choosing a specific kind of direct investment business also depends on different considerations, the most significant of which is the present law in the host country (Duce, 2003). In considering the impact of Chinese FDI in Ghana and Nigeria, it is useful to consider the form of investment that FDI takes, with regard to the respective economies. Based from preliminary research, it is clear that Chinese FDI in Nigeria is significantly higher than its FDI in Ghana, when compared to one another. Considering the high concentration of FDI in the oil and gas sector, it is possible that the economic relationship between Nigeria and Chinese may be contradictory to the developmental goals and overall well-being of the country. Whilst Chinese FDI in Ghana is seen across a variety of sectors such as aluminum, iron ore, manganese, alloy, timber, waste materials, cocoa beans, cotton linters, and frozen fish (Rahman, 2012). This indicates that the overall impacts of Chinese FDI in Ghana may be more attuned to developmental goals, compared to China’s relationship with Nigeria.FDI determinants – Theoretical ApproachAs FDI became a focal point in the current global economy, researchers have attempted to describe the conduct of multinational firms and FDI determinants through the proposal of different theories. Adam Smith (Concept of Absolute Advantages) and David Ricardo (Theory of Comparative Advantages) had originally discussed FDI as a feature of international trade. Smith and Ricardo proposed that countries should focus on producing goods where they can offer a cost advantage (i.e. absolute advantage for Smith; comparative advantage for Ricardo). The surplus of goods generated by a country is intended for export. Simultaneously, the country imports goods that it cannot produce domestically because it lacks cost advantages for their production (Sen, 2010). The theories of Smith and Ricardo are the foundations of current views on FDI. Therefore, these will be considered in the design of the theoretical framework. Heckscher and Olin linked international trade and with the benefits brought by the factors of production. Thus, a country must focus in producing final goods of which the raw materials are reasonably plentiful in the country. Conversely, the country is recommended to import the basic components of goods that are in limited supply. This theory regards FDI as a component of transnational capital movement. FDI flows are seen amongst economies and are described by various capital concentrations. Countries that are well-off in terms of capital transfer their production to countries that have abundant labor supply. This is characterized by more returns to capital and lesser returns to labor. This process continues till labor and capital are equalized in the countries involved (Benacek et al., 2000). While these theories were able to associate FDI with labor costs and higher rates of investment returns, these were unable to completely rationalize FDI phenomenon (Assuncao, 2010). As such, th ese will not be fully utilized in the creation of this study’s theoretical framework. Another FDI theory is given by Kindleberger (1969), who presumes that direct investment can be cultivated in situations where market shortcomings or government interferences exist. In this context, particular economies produce commodities in which they can demonstrate a comparative advantage; while other products are exported because the country cannot produce them efficiently. Thus, the relationship between FDI and trade can be either substitutable or complementary. Kindleberger’s (1969) theory is applicable to the context of Ghana and Nigeria because of its considerations of market imperfections and government interventions. These will be helpful in explaining some aspects of the theoretical framework. Obstacles to commerce may affect FDI in two contradictory ways. On one hand, high trade barriers tend to boost FDI because these result in high export costs. This contention stresses the location advantage aspect of FDI. In contrast, high trade barriers are a hindrance for the parent company, especially in situations with high levels of trade with associated firms. Other researchers have also discussed the relationship between FDI and trade openness (Balasubramanyam et al., 1996) and majority of studies find a positive association among these variables (Benacek, 2000). Dunning (1993) combined the components of Trade Theory and the Theory of the Firm. Based on the OLI model, Dunning (1993) classified FDI determinants into three groups. These are: (a) Ownership-specific advantages such as technology and know-how; (b) Location-specific advantages including market size, transport costs, etc.; and (c) Advantages that are particular to internationalization, wherein the firm supposes that selling of ownership advantages to third parties is not as lucrative as internally employing these advantages. Moreover, Dunning (1993) came up with the Investment Development Path based from the findings of his study. This framework identified five stages in the development of a country. These stages have a substantial effect on FDI inflows (Gorynia et al., 2005; Benacek et al., 2000). These stages of development will be one of the components in the theoretical framework; thus, this study is important to this research project. The institutional approach presents a different perspective on the subject. Root & Ahmed (1978) and Bond & Samuelson (1986) suggested that the environment, where the enterprise conducts its operations, is unpredictable and unsure. Thus, the firm’s decisions will be greatly affected by institutional forces (i.e. regulations and incentives). However, in actuality, government policy defines the options that are presented to a company and which influences the firm’s decisions regarding FDI, licensing, and exporting (Assuncao, 2010). The role of government in FDI is another aspect which will be explored in the theoretical framework. The institutional approach will be part of this analysis. Last but not least, it is beneficial to consider Ozawa’s (1992) study, which connects the patterns in developing countries with Porter’s theory of a country’s competitive advantages. According to Porter, there are four groups of attributes that can be applied to a country. These are: (a) factor conditions; (b) demand conditions; (c) firm strategy, structure and rivalry; and (d) related and supported enterprises. These have an influence on the nation’s competitiveness (Smith, 2012). Ozawa argues that the foreign investment received by developing countries, which are mainly allocated to labor-intensive sectors, results in a process of learning and technology purchase. It aids developing economies to raise their competitive advantages and thus, push the economy onward along the various stages of development ? moving from the fundamental factor-driven stage to the innovation-driven stage. This is described by an increasing external FDI (Ozawa, 1992). The discu ssion on competitive advantage is again a major component of the theoretical framework which will be the outcome of this research. As such, the study by Ozawa (1992) presents some arguments that are crucial to the discussion of this research.FDI determinants – ClassificationDunning (1998) identified four groups of FDI motives. The first two groups of motives are features of the initial stage of FDI, while other groups are related to sequential FDI (Gorynia et. al., 2005). Resource Seeking – the firm intends to obtain specific resources at less costs than in the local/national market Market Seeking – the firm intends to operate in a specific overseas market because of its size or anticipated growth. The firm builds a global strategy for the foreign market, or reduces the expenditures related to serving a certain market from a neighboring facility instead of from outside the country Efficiency Seeking – the firm intends to justify its production, distribution, and marketing (Gorynia et. al., 2005, p.65) Strategic Asset Seeking – the firm seeks to extend its strategic goals; for instance, supporting their competitiveness in international markets Clause (1999) and Calderon et al., (2002) categorized FDI determinants in two groups: (a) ‘Push factors’ or investor’s intentions to position capital/investment overseas: (b) ‘Pull factors’; or country-specific determinants, also referred to as location determinants. These factors influence the decision of the investor to find capital in a specific country. Additionally, pull factors are political, including growth estimates, or the country’s system of rules/regulations and rewards/incentives. The authors also highlighted other pull elements in the case of transitional economies. These include the process of privatization and the intensification effect, in which a direct investment results in other direct investments (Vita and Kyaw, 2008). Lastly, UNCTAD (2011a) segregated FDI determinants into three categories: (a) policy framework such as economic and political stability, competition policy, etc.; (b) business facilitations, including the costs of business operations, investment motivations, etc.; and (c) economic determinants such as market growth and infrastructure. Although these determinants help to ascertain the overall desirability of the country, the significance of specific groups differs depending on the sector and entry modes. The various FDI determinants will be explored as components of the theoretical framework. These will be investigated to find out which FDI determinants are applicable to the Ghanaian and Nigerian context.Investment Climate in Ghana and Nigeria – A Comparative AnalysisAttracting increasing amounts of FDI has been a significant priority of Ghana’s government when developing and reforming economic policy. The Ghana Investment Advisory Council (GIAC) was formed with the help of the World Bank and is comprised of local and multinational companies and institutional observers from around the world. The aim of the GIAC is to ensure the removal of any regulations, which may discourage FDI in the country. The GIAC, however, does not have regulatory power over the natural resources sector, but does regulate investment in all other sectors, such as banking and other financial institutions, telecommunications, energy and real estate (Tsikata, et al., 2010). The most beneficial eleme nt of the investment climate in Ghana is that there is no general economic or industrial strategy aimed at discriminating against foreign owned business or subsidiaries, but conversely there are incentives offered if the projects are deemed critical for national development. Prior to 1995, Nigeria was considered one of the most unsuitable countries in Western African for FDI due to a combination of considerable restrictions and unsuitable investment climate ? the result of social, economic, and political tensions that continue to plague the country. In 1995, however, Nigeria changed the investment climate substantially by opening the economy to FDI and reversing these severe restrictions. The Nigerian Investment Promotion Commission (NIPC) was created to manage the approval of business licenses and motivations to improve the investment climate. All restrictions on limits in foreign shareholding were also abolished in order to promote and facilitate FDI. According to current Nigerian investment law, 100 % foreign ownership of firms is allowed in every sector, with the exception of the petroleum sector. In this sector, investments are restricted to existing joint ventures or new production sharing contracts (Oyeranti, et al., 2010). This, however, is not n ecessarily a restrictive provision specific to Nigeria, since production sharing contracts have become a modern way of ensuring that ownership over natural resources is held by the host nation. It is evident, therefore, that both the Ghanaian and Nigerian investment climates are conducive and receptive to FDI from China. In determining the potential impacts of these investments on the economies of the country, it seems evident that there is a need and desire for large capital investments. At the same time, there is the need to stay in control of their natural resources, namely oil and minerals, which has resulted in the only restriction on FDI in the respective economies. The crucial difference between the two countries is the vast superiority of Nigeria with regards to their oil resources and the far-reaching effects that this has had on the country as a whole. This factor must, therefore, be critically considered to assess the impact of Chinese FDI in the country.Chinese Interest in West Africa – FDI AnalysisChina provides an ideal investment partner to African countries and is often more beneficial to the host nation that traditional investment partners for a numb er of reasons, including fewer demands on the host country in exchange for investment, fewer conditions for assistance, offered assistance at lower rates of repayment and lower interest rates, and offered training for technical and professional personnel in doing so (technology transfer) (Renard, 2011). Historically, the interest in Africa from the Chinese perspective has been primarily based on the need to supplement their own natural resources, with the rapid development of their manufacturing industry necessitating a significant amount of resources far outweighing any domestic production in China itself and with an abundance of these resources in West Africa, China sought to increase their investment in and trade participation within the region. In 1987, China exempted raw materials and other components due for re-export from custom duties which bolstered their international trade with African countries as being a significant source of these products and raw materials (Renard, 20 11). With the Chinese accession to the WTO, the protectionist barriers were further removed and this served to increase trade even further. Trade in components is therefore a significant part of Chinese interest in West Africa, as well as raw materials in exchange for consumer products with low capital intensity with a commitment to moving towards more technology-intensive products. In addition to the trade investment in West Africa, diplomacy in the region has focused on bilateral agreements with African governments. In 1994, the Exim Bank (China Export-Import Bank) was founded to encourage Chinese exports and FDI in Africa, with a specific focus on improving the infrastructure (Wang, 2007). On the other hand, China Development Bank (CDB), also established in 1994, opened the China-Africa Development Fund to assist Chinese FDI distribution into Africa, through the financing of Chinese firms looking to invest in the region. Finally, SINOSURE (China Export and Credit Insurance Corporation) provides these firms with insurance and protects against the risks associated with Chinese exports and foreign investment (Renard, 2011). These banks have a less risk-sensitive profile than most private banks in traditional Western investment partners, making them more willing to encourage to investment in often high-risk African countries, including Nigeria. The opportunity to invest in Africa by Chinese firms is as a result of the long-standing history of trade relations and supported by less risk-sensitive banks. These banks aim to encourage FDI in West African countries in order to sustain and potentially increase trade relations with the Chinese economy. With many of the major players in the Chinese economy being state-owned (as a result of the prevailing political regime), there is a significant interest in encouraging FDI with these West African countries due to China’s desire to sustain its high economic growth. This supports the main assumption of this research that China’s FDIs into Ghana and Nigeria are exploitative in nature. Because China’s desire to sustain its economic growth as the main driving factor for its FDI, there is a lot of suspicion that Chinese state-owned investors will not care about the long-term effects of FDI, especially as it focuses on extracting natural resources and raw materials fro m Ghana and Nigeria. METHODOLOGYResearch PhilosophyThis study applies the positivist philosophy, based on the presumption that experiment and observation are highly significant in perceiving human behavior. According to this philosophy, the world can be understood in a rational way. This approach focuses on analyzing facts and seeks to understand connections; reduces experience to simple components; and tests formulated hypotheses. It usually produces qualitative data, which seeks to be unbiased and precise (Saunders et. al., 2009).Research ApproachThis study is empirical and it acknowledges the significance of gathering and utilizing data, to achieve precise and clear conclusions. Inductive and deductive research approaches will be employed in the study. The deductive approach is described as highly structured. Theories of FDI motivations are first presented, since they are especially relevant to the Chinese FDI climate. Next, the relevance of these theories to both Ghana and Nigeria is discussed through the analysis of empirical data. An inductive approach is observed throughout the gathering and examination of empirical data from trustworthy sources. From this perspective, the researcher analyses the data obtained by others, which has been integrated with the research procedures. Given the research objectives, this study has an explanatory quality . Explanatory research aims to explain if there is an association among two or more variables of a specific incident or phenomenon. The aim of this study is to ascertain whether there is an association between FDI inflows from China to Ghana and Nigeria using a framework for the measurement of these impacts based on economic, political or social factors which may be influenced by foreign investments.Data Collection ProcessPrimary and secondary data will be gathered to analyze the possible impacts of FDI inflows from China. Selected economic indicators will also be analyzed using multiple regression analysis. This research will examine the following economic indicators: GDP growth rates; GDP per capita; inflation rates; employment rates; unit labor costs; trade balances (represented as a percentage of GDP); foreign exchange rates; Corporate Income Tax Rates; percentage of people with higher education; developmental goals identified by the host country and other international bodies, and public spending on higher education. The data that will be used in this research will be taken from several different secondary research sites. Data sources are national statistics, scholarly publications, UNDP, IMF and the World Bank, as well as any other directed research that is seeking to understand the relationship between Chinese FDI and its impacts in Ghana and Nigeria countries.Limitations of ResearchThe current research is limited to the extent that Ghana and Nigeria are compatible in conducting the comparative analysis. The main concern is that the vast difference in the oil dependency of these two countries will lead to a number of conclusions, which are not compatible with one another, due to the fact that the Nigerian economy revolves around oil production. It is reasonable, therefore, to think that the application of this theory to Ghana may lead to conclusions or recommendations for improvement, which cannot be applied to the Nigerian context due to its resource dependency and the influence of the social, political and economic climate. In order to mitigate this limitation, the researcher aims to look specifically at the dependence on natural resources (mineral and oil) in the Ghanaian economy in order to ensure that this factor is given sufficient consideration in reaching the conclusions of this theoretical research.Secondary PublicationsPublished secondary resources will also be utilized in this study. These sources discussed FDI determinants from a general perspective and presented global outflows of FDI from China. These also analyzed the general determinants of FDI impacts in Africa as a developing region, with a specific focus on Ghana and Nigeria, and compared these impacts against one another to determine recommendations for the improvement or mitigation of FDI impacts. The application of secondary data in addressing the objectives of this research will add to the overall clarity of the research. Secondary data will be gathered by studying documents from various sources, su ch as international organizations and statistics offices. Other materials are peer-reviewed articles, research papers, books, and other scholarly publications. These will aid in recognizing and incorporating the most relevant literature within the context of the main research questions.Limitations of Secondary SourcesThere are some limitations in using secondary sources. One limitation is that it involves the possibility of incurring knowledge gaps. This refers to the occasions when researchers are unable to find the specific data they are looking for. Moreover, data might be outdated or is not relevant to the research problem. Furthermore, the researcher might find contradictory points of view in the secondary data, which will result in confusion and ambiguities. To lessen these kinds of risks, the researcher will seek the advice and guidance of academic staff specializing in this research subject regarding suggestions on literature. The researcher will also come up with a comprehensive list of international databases of FDI to find the most current data.Data AnalysisThe data analyses that will be applied in this research are comprised of four important steps. Data will be arranged in a rational way. The arrangement of primary and secondary data is based on the selection process (based on the researcher’s judgment). Data will be sorted into three categories. The categories are as follows: (a) Theoretical application of FDI in a Chinese context; (b) Ghanaian and Nigerian investment climate and context; (c) the relationship between Chinese FDI and the Ghanaian and Nigerian political, social, and economic factors. Data will then be analyzed using a number of qualitative research techniques. Results will be organized in terms of theoretical FDI themes identified in the initial research. DISSERTATION PLAN Below is the Gantt chart for the dissertation. This outlines the main activities that will be conducted for this research. Project TasksStartDuration Task 1: Writing the research proposal05 Task 2: Writing the project plan55 Task 3: Conducting the literature review1014 Task 4: Gathering of secondary data247 Task 5: Creation of theoretical framework3120 Task 6: Analysis of the data5114 Task 7: Writing the final research report6514 Note: Start – Represents the number of days from the start date of the research project Duration – The number of days required to complete the task REFERENCES Asiedu, S. (2006) Foreign Direct Investment in Africa: The Role of Natural Resources, Market Size, Government Policy, Institutions and Political Instability. United Nations University Publication [online] Available on: http://www.people.ku.edu/~jbrown/virus.html [Accessed 1 April 2013] Assuncao, S., Forte, R. and Teixeira, A. (2011) Location determinants of FDI: a literature review. Porto: FEP. Benacek, V., Gronicki M., Holland, D. and Sass, M. (2000) The Determinants and Impact of Foreign Direct Investments in Central and Eastern Europe: A Comparison Survey and Econometric Evidence. Journal of United Nations. 9(3). Pp. 163-212. Bevan, A. and Estrin S. (2004). The Determinants of Foreign Direct Investments into European Transition Economies. Journal of Comparative Studies.32. Pp.775-787. Botric, V. and Skuflic, L. (2005) Main determinants of Foreign Direct Investments in the South East European Countries. Zagreb: Institute of Economic. Calderon, C.L. and Serven, L. (2002) Greenfield FDI vs. Mergers and Acquisitions. Does the distinction matterChile: Central Bank of Chile. Duce, M. (2003) Definition of Foreign Direct Investment: a methodological note. Madrid: Banco de Espana. Dunning, J.H. (1993) Multinational Enterprise and the Global Economy. Essex: Addison-Wesley Publication Company. Frimprong, S. (2012) Research on Relationship between China and Ghana: Trade and Foreign Direct Investment (FDI). Journal of Economics and Sustainable Development, 3(7), pp. 51 – 61 Gorynia, M., Nowak J. and Wolniak R. (2005) Motives and Modes of FDI, Firm Characteristics and Performance: Case Study of Foreign Subsidiaries in Poland. Journal of Transitional Management.10 (3). Pp.55-87. Johnson, A. (2005) The effects of FDI inflows on host country economic growth. Jonkoping: Jonkoping International Business School. Moosa, I. (2002) Foreign Direct Investment: Theory, Evidence and Practice. NY: Palgrave Macmillan. Morgan, T. (2005) How does FDI affect host country developmentUsing industry case studies to make reliable generalizations. [In:] Morgan T., Graham, E. and Blomstrom, M., Does Foreign Direct Investment promotes developmentWashington: Institute for International Economics. OECD (1999) OECD benchmark definition of Foreign Direct Investment.3rd edition. Paris: OECD. Oyeranti, O., Babatunde, A., Ogunkola, E. & Bankole, A. (2010) Chinese-Africa Investment Relations: Case Study of Nigeria. Nairobi: African Economic Research Consortium Ozawa, T. (1992) Foreign Direct Investment and Economic Development. Transnational corporations. 1(1). Pp. 27-54. Rahman, M. (2012) Political Economy of China’s Foreign Direct Investment in Ghana. GhanaWeb [online] Available on: http://www.ghanaweb.com/GhanaHomePage/NewsArchive/artikel.php?ID=236093 [Accessed 1 April 2013] Renard, M. (2011) China’s Trade and FDI in Africa. African Development Bank, Working Paper Series, no. 126. Belvedere: African Development Bank Saunders, M., Lewis, P. and Thornhill, A. (2009), Research methods for business students. 5th Ed. Harlow: FT Prentice-Hall. Sen, S. (2010) International Trade Theory and Policy: A review of the literature. NY: Levy Economic Institute. Smit, A.J. (2010) The Competitive Advantages of Nations: Is Porter’s Diamond Framework a New Theory That Explains The International Competitiveness of CountriesSouthern African Business Review.14. Pp.105-130. Tsikata, D., Fenny, A. & Aryeetey, E. (2010) Impact of China-Africa Investment Relations: An In-depth Analysis of the Case of Ghana. Institute of Statistical, Social and Economic Research University of Ghana: African Research Consortium UNCTAD (2011a) World Investment Report 2011.Non-equity modes of international production and development. NY: United Nations. UNCTAD (2011b) World Investment Prospect Survey2011-2013.NY: United Nations. Vita, G. and Kyaw, K. (2008) Determinants of FDI and Portfolio Flows to Developing Countries. A panel co-integration analysis. European Journal of Economics, Finance and Administrative Sciences, 13.Pp. 161-168. Wang, J. (2007) What Drives China Growing Role in Africa. IMF Working Paper, WP/07/211. International Monetary Fund, African Department.

Understand Children with Attention Deficit Hyperactive Disorder Research Paper

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The Importance of College Essay Example for Free

The Importance of College Essay Higher education can be very beneficial to the individual and to the broader community. The common conception that higher education would mean higher pay is proven to be true. Not only is college beneficial to the individuals, but in the long-run, it helps their communities as well. College-graduates can provide their communities with new businesses and a better skilled work-force. Therefore, it would be an advantageous for people to attend college as it will promise a brighter future. College education was said to be beneficial even in the earliest years of American history. One of the many people who advocated college was Thomas Jefferson, â€Å"The less wealthy people†¦ by the bill for a general education, would be qualified to understand their rights, to maintain them, and to exercise with intelligence their parts of self-government†¦Ã¢â‚¬  (88). His writings about education has shaped the early decades of America’s schooling system. He thought that education would help to ensure the equality of all people in the country. Higher education was thought to be beneficial to early America because it was supposed to preserve the nation’s democracy. Schools like Harvard in 1636 and Yale in 1701 strongly approved of a good education. The colonies of America directly supported many of the early colleges (Rudolph 492). In the 1950s, The Truman Commission on Higher Education helped push the community college movement. They said that education would promote â€Å"equal liberty and equal opportunity to differing individuals and groups† (Ostar 168). This group wanted the citizens of America to be able to understand their rights and duties in the democratic nation. Typically, today’s belief about college is that it provides better economic benefits. These benefits could be higher status jobs and better pay. These beliefs stem from many sources. Every year, newspaper and television would feature stories about the current college graduates and their future jobs. These stories contribute to giving the public the idea that college is about success. President Bill Clinton gave a speech at Princeton University about the significance of going to college. He proclaimed that a higher education would lead to better individual economic interest. He continues to say that â€Å"Two years of college earn a quarter of a million dollars more than their high school counter-parts over a lifetime† (Reaping 20). Policymakers encouraged people to attend college when they allowed forty billion dollars over five years to be used for better development of education. Because of all the publicity associating with better pay, many Americans now believe the same. There has been research to confirm the views of higher education and higher pay. Schultz, Becker, and Mincer formally proved the relationship of the two. Becker said investments in human capital would increase in value as the individual’s skills increased. Education was said to be an investment that would later return with positive outcomes. Leslie and Brinkman estimate that mean rate of return to obtaining an undergraduate education was about 12. 4 percent (Reaping 145). Berger and Black university of Kentucky’s Center for Business and Economic Research said, â€Å"The most enduring economic impact of the universities is the increased earning power that students take with them into the job market† (NELA). They convey that college education would help the individuals throughout their life. They would contribute to the nation by starting new business with a better labor force. Better education may also have a beneficial effect on civil society. Civil society could be strengthened by community involvement and organization that helps keep communities together. It is thought that higher education prompts people to volunteer, donate to charities, and overall help their community. It is estimated by the Kentucky Long-Term Policy Research Center that people with better education are more likely to be involved in their community and participate in leadership activities. These college-educated participants are likely to be in a group to solve problems for their community. They concluded that a person doubles their probability to be a leader of a community if they have a four-year degree or higher compared to a high school graduate. Individuals were surveyed about donating to charities. 85 percent of high school graduates responded â€Å"yes† while 93 percent of those with a bachelor’s degree or higher did the same (NELA). Since Fall 2002, there are more people with college degrees than ever before. Workers who attended college went from 26 percent to 33 percent between 1992 and 2000. This is because employers like workers who have graduated from college more compared to non-graduates. Studies have shown that college-graduates are generally better at â€Å"creative thinking, effective communication, problem solving, organization, teamwork, research, and decision making† (NELA). People with a college degree are half as likely to be without a job compared to people who are high school graduates. This is because many managers generally feel that college-graduates are more determined and serious about their job. Managers also tend to give more promotions to the college-graduates over the non-graduates (NELA). Higher education can lead to public economic benefits. These improvements generally help the nation’s economy as a whole. This comes from the peoples participations with better education. Increased tax revenues would mean that the nation is better off. In 1994, college-graduates paid 71 percent of all federal incomes taxes. Better education would also mean better productivity. America’s productivity has increased over the last twenty years because of the steady increase of the quality of education. Increased consumption would also be good for the nation because it would lead to a stronger economy. Studies have shown that the increase of consumption is direct result of better education. Since the economic system is always changing, higher education has allowed the workforce to be more flexible because they gain generalized skills such as critical thinking, writing, and communication. The final public economic benefit is that college-graduates are less likely to rely on government assistance programs for living, such as Food Stamps, Medicaid, housing assistance, and other programs (Reaping 15). There are many individual economic benefits with higher education. College-graduates earn more in both their lifetime and annual incomes. In 1995, a person with a bachelor’s degree earned 73 percent more money than a high school graduate. There have been studies to prove that people who went to college earn better fringe benefits such as vacations and health care. College-graduates are hired at a higher consistency. In 1998, unemployment has decreased for people with a bachelor’s degree. People with only a high school diploma are three times as likely to be without a job. Another benefit of having a college degree is improved working conditions. These people enjoy air conditioned heated rooms with other benefits like computers. Overall, their working conditions are better than high school counterparts. Research has told us that college graduates are better at changing jobs. This is because they have learned more skills to apply to a broader range of differing jobs. The Census Bureau’s survey says that â€Å"those with a bachelor’s degree or more have higher value interest earning assets, home equity, and other financial assets† (Reaping 16). There are public social benefits that stem from college graduates. Out of a population of 100,000, there were 122 prisoners with college experience compared to 1,829 prisoners with some high school education. A study showed that 77 percent of people with college degrees help their communities by volunteering compared to only 45 percent of high school graduates. Another public social benefit is that there are better voter turnouts with college graduates. In 1992, 79 percent of college educated people ages 25-44 voted; this is compared to 50 percent of those with only a high school diploma and 27 percent of those without a high school diploma. Studies have shown that the offspring of the better educated parents have a better chance to go to college. The daughters of the college graduates are less likely to have unexpected pregnancies. College-educated people also have more free time. They have time to read more literature than high school graduates. They also visit theme parks, museums and sporting events at higher rates (Reaping 23). With all these great benefits from college education, there is no reason why students shouldn’t go to college. The experience will stay with the individual throughout their life. Their private economic benefits are better, while simultaneously helping their nation with public economic benefits. College education is the way to a brighter and more prosperous future for all. Works Cited Jefferson, Thomas. The autobiography of Thomas Jefferson, 1743-1790: together with a summary of the chief events in Jeffersons life. New York: Dover Publications, 2005. Print. NELA. NELA. N. p. , n. d. Web. 1 Oct. 2013. Ostar, Allan W. Colleges and universities for change: Americas comprehensive public state colleges and universities. New York: AASCU Press, 1987. Print. Reaping the benefits: defining the public and private value of going to college: the new millennium project on higher education costs, pricing, and productivity. Washington, D. C. : The Institute for Higher Education, 1998. Print. Rudolph, Frederick. The American college and university, a history. 1st ed. New York: Alferd. A. Knopf, 1990. Print.

The Strengths And Weaknesses Of Delta Airlines Tourism Essay

The Strengths And Weaknesses Of Delta Airlines Tourism Essay Since the establishment of Delta Airlines in 1928, it has played a pivotal role in what the aviation industry is today. Delta airlines can be considered without a doubt one airline that has stayed in business through ups and downs throughout its near 90 years and continues to thrive in the commercial airline industry. Even though Delta Airlines has faced many obstacles throughout its history, Delta Airlines has had many success and triumphs. It is one of the major airlines that have accomplished many things that other airlines has not. One of the major points to Delta Airlines success is its ability to serve more than 170 million passengers a year as stated on Delta Airlines website. Strengths Of Delta Airlines Delta Airlines is constructed around many of its strengths such as currently being the largest airline in the world today as stated on the index of Delta airlines Website, but many of its strengths revolve around it being able to fly to 567 worldwide destinations in over 100 different countries. One of the strong points of Delta Airlines being the worlds largest carrier today is having 10 major hubs in all the major cities in the United States. Some cities include New York, Cincinnati, Salt Lake City, Minneapolis, Detroit, as well as major cities in different countries such as Amsterdam, and Tokyo. This is one of the major stepping stones for a U.S. based airline company as it is able to expand to different continents around the globe. Another strength of Delta Airlines lies in its current fleet of aircrafts that currently consist of 449 airplanes majority of which are Boeing 757-200 series. Other aircrafts at Delta Airlines consist of Boeing 737, 767, 777, MD88 and MD90. Another advantage of using Delta Airlines is that throughout the companys history, to date there has only been one fatal accident back in 1996 as statistics show on the planecrashinfo.com website. Compared to other airlines history of fatal accidents Delta Airlines rates number 1 due to the fact there has been only one fatal accident and it has over 16 million flights a year. Being number 1 in passenger customer service alone is just another part that helps to make Delta Airlines what it is today. Passenger service, a clean history of flying, and flying to over 6 different continents around the globe leads to Delta Airlines having one of the highest gross revenue in the airline industry. The company recorded revenues of $19,154 million during the financial year ended December 2007, an increase of 9.3% over 2006 as stated on the companies and markets / delta airlines website. Delta Airlines is one of the only main carriers that expected a drop in profits for the year 2008 yet it was able to still have a higher revenue than other carriers in 2008. Delta Airlines has also come up with many innovative business moves that has helped it to become one of the most dominating in the airline industry today. Delta Airlines came up with their own private airline within the company on April 15th 2003. Song Airlines was a low cost airline for the lower and middle class people and its main creation was to compete directly with Jetblue Airways. Not only has Song Airlines been a smart move for Delta Airlines but one of the most historic move in the airline industry has been the merger of Delta Airlines and Northwest Airlines. The merger came about as a way to prevent the growth of airline competition in the industry and also to battle cost of fuel prices. In 2008 after both airlines merged together, Delta Airlines would have an increased fleet of 800 aircrafts, and 75,000 more employees as stated by the LATIMES.Com website. Last but not least is Delta Airlines being a part of the Skyteam Alliance. Delta Airlines has an anti-trust immunity an d what that mean is it can sharing marketing, pricing and its network with other airline companies within the Skyteam Alliance. Delta Airlines has a variety of competitive advantages at its arsenal compared to its competitors. Another distinct advantage for Delta Airlines is the scheduling, pricing, and departure as well as arrival times. For example on CheapoAir.com website, a round trip to Toronto, Canada would cost $331.88 with Lan Airlines, $307 with American airlines, and Delta Airlines would cost $228.28. Like all carriers, Delta Airlines offers many different flights to many different countries throughout the world, but what gives Delta Airlines another distinct advantage over competition is majority of the time when Delta Airlines is forming its schedule it will either try to depart 15 minutes earlier, or arrive at its destination 15 minutes earlier over its competitors. There are many significant advantages within Delta Airlines today and some that are a strong point within Delta itself are many long-term advantages over its competition. Delta Airlines has started to offer wi-fi service for in-flight passengers as well as on-board shopping as well as Delta on Demand and other features in the economy class flight, for first class passengers it offers the same as economy class but more comfy pillows, and blankets, free cocktails, and on the more pricey business-elite class its offers flat bed seats as provided on the Delta Airlines website. Another long-term advantage of Delta Airlines is its worldwide route system which Delta is codeshared with many airlines in North America such as Northwest Airlines, Continental Airlines, Alaska Airlines for flights from Seattle to Alaska, Aero- Mexico for trans-border services as well and domestic Mexico services, and Air Jamaica for service for flights between Jamaica and the U.S. Delta Airlines codeshare partners worldwide include Air-France for flights to Paris, Europe, Middle East, and Africa, Alitalia Airlines for service to Europe via Italy, Air-Japan for service via Transpacific such as Japan, and China, Avianca airlines for Colombia domestic services and Czech Airlines for service from Prague to Eastern Europe. Incorporating the BCG Matrix, Delta Airlines has many so-called Stars within its company for example its Worldwide Route System, Pricing, and its current fleet of over 449 different aircrafts, but there are also many other Stars within Delta Airlines such as it has partial ownership in both Orbitz and Worldspan websites when purchasing tickets online and Delta also offers a 3-5% discount for purchasing tickets online and 2% discount for check-in using self service kiosks. Compare to other airlines Delta airlines is best airlines and also, Delta gives better packages and other requirements. Delta Air Lines, Inc. is the third largest air carrier in the United States and the largest U.S. carrier serving Europe. Its route network serves 317 destinations in 55 countries. Its domestic network operates around a hub system at airports in Atlanta, Cincinnati, New York, and Salt Lake City. The Delta Shuttle serves business travelers flying between New York City, Boston, and Washington, D.C. (and other continental airlines. The company has a strong network infrastructure enables it to gain access to key market as well as enhance the quality of its delivery services. However even though delta airlines may seem to many as the dominant airline, there are many flaws within Delta Airlines itself. Some of these flaws are very minor while some affect Delta Airlines drastically. It is safe to say that no airline is without flaws and some of these flaws include high maintenance cost. Some examples of opportunities to Delta Airlines include internal as well as external factors. The rising fuel price could have a direct impact in the companys margins. Though almost all carriers are expected to post negative earnings in 2009, however it is the most successful low cost carrier in the U.S. has maintained continued profitability for the last 30 years even during periods of industry downturns mainly due to its strong fuel hedging strategies. Low-cost airlines are expected to get a higher share of revenue in the future, which will see structural changes in the industry and consolidation as a result of competitive pressures. I think anyone will agree that wherever you are entertainment matters. Think about ità ¢Ã¢â€š ¬Ã‚ ¦consider the number of movies youve seen, the countless hours of television youve watched, the thousands of songs youve downloaded and the video games youve played. (Maria. F. 2008). The world would be a seriously boring place without entertainment. Im not sure how many of you have had a chance to fly on one of our aircraft equipped with the Delta on Demand digital entertainment system, but if you have then you know what a huge difference it makes to have a ton of stuff to watch on your own personal screen. Weve got satellite TV, movies, HBO, 2,500 MP3s and games all on demand (Babb, C.2007). Some International flight have long been cash cows according to the BCG Matrix, but some have become burdens to be unloaded as quickly as possibly as business travelers cut back, taking with them the high-end fares that subsidize tourist-friendly discounts. In Delta Airline industry the passenger traffic in largest Asian carrier by revenue, have been battered by a drop in passenger traffic because of the global economic crisis. Almost other airlines have played an immense feat, juggling both the legacy and low-cost carrier segment with unwavering commitment in going through the test of times during the last seven years and especially through 2008. The year 2007 was a year of regaining profitability for the airline industry after the uphill struggle of cutting off redundant infrastructure and going through various mergers and acquisitions and recovering from the post 9/11 downturn in volume of passenger air traffic. The exponential surge in fuel price and present volatility in financial sectors have significantly affected the aerospace industry as a whole. (Zack E). Delta Airline corp. will be able to rationalize and offer efficient services with gradual freedom to operate in open skies if governments look to deregulation as a way to pro mote the industry as a whole. The previous drop of 50 percent in airline share prices might just reach their initial levels, post all the merger and infrastructure cutbacks by early 2009. Delta airline prices of air tickets globally will have come down to initial levels by end of 2008. On a positive note, the Asia Pacific players will not face any loss for 2009 and might even be left with few cents in the pocket. The market will still see reasonable growth in Low Cost Carrier passenger traffic within Asia Pacific and even in the long haul segment. Delta Airlines 6 Despite the worst economic recession in our lifetime, the fundamental strength of Deltas business allowed us to deliver breakeven results this quarter, excluding fuel hedge losses and special items. These results would not be possible without the hard work of all Delta employees they are running a great airline while executing a seamless integration in the midst of this very difficult economic environment. We remain focused on making disciplined decisions about capacity, costs and capital, achieving merger synergies and finding new sources of revenue. Delta airlines reported that a $794 million first-quarter net loss, or $0.96 per diluted share. Delta cited slower demand for travel brought on by the current recession as reason for the loss. On the cargo side of the business, cargo revenue declined 44 percent or $146 million during the first quarter. Again reasons for the decrease were attributed to the current global recession, decline in fuel surcharge revenue, and decreased demand for air cargo services. Delta travelers have lately been complaining more often about frequent-flier programs, namely the lack of award seats on desirable flights, escalating fees for ostensibly free tickets and quicker expiration dates for miles. Airlines counter that they are giving away more awards than ever, despite generally fuller planes, and that most programs allow members to book any open seat on any flight, albeit in exchange for more. We at Delta and as an industry cannot continue to have customers earn a significantly greater number of miles year after year without providing customers some flexibility in ways to use those miles, Airlines are also offering more ways for members to use their miles, like bidding for things like Broadway tickets at online auctions, trading miles for merchandise or using a combination of cash and Miles for air travel. (Susan S, 2008) While most carriers have customarily been tight-lipped about how much they earn from these programs, more details are starting to emerge. United reported revenue of $800 million last year from selling miles, while Qantas earned $218 million in the last half of 2007 from mileage sales to third parties. (Susan S, 2008) These are some very important aspects to keep in mind when you look at the strong points in Delta Airlines as well as the weak points in Delta airlines, but then again there are many other factors that affect Delta Airlines. One example is threats, such as competition, and the main aspect of supply and demand. Delta Airlines 7 One threat Delta Airlines faces vs. US Airways on-time departure performance. US Airways has an average of 95% on time departures vs. a 93% from Delta. At arrival performances both are at the same percentage, 94%. US Airways does not exceed Deltas workforce (employees) however, they have close to 32,151 total employees. US Airways only serves 25 countries and 196 destinations, 41 international and 155 domestic. Their fleet is the closest they get to ours (Delta), they possess 600+ aircraft. Delta surpasses US Airways daily flights by almost 5 times, they only have 3,043 daily flights. Delta has superior advantage over US Airways, Delta was established on 1924, US Airways was established 1939. Delta traces its roots back to 1924, when Huff Daland Dusters was founded as the worlds first aerial crop dusting organization (Delta, 2009). We have several airline accidents, through our history. These accidents have resulted in fatal accidents. Is a threat, because whenever a customer looks a t our flying history that may incline them to look for another airline. One remarkable accident happened on August 2nd 1985, flight departed from Fort Lauderdale, Florida bound Los Angeles Intl airport, the aircraft crashed with only 27 survivors out of the 163 people on board (Leo Beber, 2009 ). The factor for this accident as per NTSB (National Transportation Safety Board) was microburst induced wind shear. One of the ethical threats against US Airways is airline quality and passenger satisfaction. Delta is on the number 10th place and US Airways is on 8th (Airline Quality Rankings, 2008). This means that Delta Airlines is not keeping up with the on-time performance, customer service, baggage handling and/or bumping people around due to overbooking. For this year (2009), Delta airlines only rose its customer service by 6.7 percent, while US Airways rose a 9.3 percent. That is not so good news for Delta airlines, we need to improve our customer service, may be a way of doing so would be giving our Delta representatives weekly training, in order to rise our customer service satisfaction. Customer satisfaction is vital to the administration because if customers are not well satisfied, we will lose customers and that would make a big impact in our economic status. A major exterior factor that every single airline faces today is terrorism. One of Deltas biggest threats are bomb and highjack threats. This gives Delta Airlines, a disadvantage and bad reputation, Why and how it that? Well, most passengers or for the most part, the public does not know or may think that every airline has its own security. Therefore customers may think our security system is incompatible and unreliable. Truth is, no airline has its own security, airports Delta Airlines 8 Offer and provide the security system for the whole entire airport. But people may fail to see that or in other cases even get scared on flying with Delta Airlines just because of the terrorist threats Delta has faced throughout its history. For example; the latest threat was on a flight making its final decent into LAX, Airport in Los Angeles, January 09. Individual was yelling out he had a bomb. Passengers actually tackled the individual immediately without hesitation. At the end guy never really had a bomb, just to show you bomb threat or highjack threats are out of ones hand. The Port Authority of NY NJ has TSA personnel at La Guardia, JFK and Newark. TSA do screening on luggage, metal detectors for individuals, etc. checkpoints are operated by Transportation Security Administration, the checkpoints are there to make sure that terrorists cant bring anything aboard the plane that would enable them to take it over or destroy it (TSA, Travel Assistannt-2009) Terrorist threat is a f actor that no one has power on stopping it. Only thing we are able on doing is providing with the latest and sophisticated equipment to detect any hazardous threats that put the airport, aircraft and of course passengers life in jeopardy. Predatory pricing is one of the most competitive threats between airlines and other businesses. There is no specific price rate, due to seasonal flights, due to competitions. Airlines must keep their prices as close as possible to each others. In some cases new airlines may go out of business real quick if senior airlines decide to lower their prices just to keep the customers. When this senior airlines decide to lower their prices than average, one fact is that they losing money just trying to keep customers. Seasonal flights are a very competitive battle between airlines trying to catch as many customers as possible by giving great deal at cheaper prices as possible and as profitable as well. Seasonal flights can also stress an airlines structure due to competition. The Big Six airlines United, US Airways, American, Northwest, Continental and Delta have divided the country into local fiefdoms centered around fortress hubs (Leah Platt, 2001) Advertising the airline is a very important thing all airlines must do. From personal opinion, I always see T.V. advertising commercials of Delta Airlines. This is a factor some airlines fail to realize. Delta airlines is very well known thanks to its advertising on TV, radio and internet. Few airlines that are a threat to us just for the fact that they advertise as much as we do (Delta) are Continental, Jet Blue, American Airlines. Those are the most advertised on television. For some reason US airways doesnt advertise as much. This is a threat as well, because if an airline wants customers, it needs to put it out where the public sees it. Other airlines copying over a successful structured airline is a threat. For Delta Airlines 9 instance, if Delta decides to advertise on TV, radio, internet, newspapers, magazines, put lower prices, offer great deals and the rest of the airlines decides to do the same. That puts us in a spot where we have to improve our current structure. Every day, in newspapers across the country, airlines advertise flights at attractive and competitive prices. Every day, in newspapers across the country, airlines advertise flights at attractive and competitive prices (Public Interest Advocacy Centre, 2003). Overall, an airline biggest threat is the rising of fuel prices. Delta as well as other airlines, add a surcharge to the base price of the route its been flown. In some cases airlines struggle to set a price on a route due to the up and down of the fuel prices. Luckily, as of now (2009) fuel is not as high as previous times. It affects the customers when fuel prices are sky high, because an airline must raise its prices in order to keep the profits. Several airlines offer the same route and one has lower price tickets, like Southwest and Delta. Both Southwest and Delta charge $148 for L.A to Salt Lake route. But US Airways, which like Southwest, is a lower-cost airline, has less invested in the L.A. to Salt Lake route; for this airline, the route is a simple connecting flight, so it doesnt mind tacking on a $50 surcharge to its $148 base price à ¢Ã¢â€š ¬Ã‚ ¦ Southwest, true to its lower-cost carrier status, doesnt have a fuel surcharge. Delta often adds a fuel surcharge, but knowing that Los Angeles to Salt Lake is a very competitive nonstop Southwest route, the legacy carrier eschews the surcharge in this instance, to stay competitive (Rick Seaney, 2008) Last but not least, no company is without its weakness. Delta Airlines has established its dominance in the aviation industry as one of the best airlines in the world today, but being the best doesnt necessarily mean Delta Airlines doesnt have its own drawbacks. This report examines Delta Air Lines Weaknesses, Inc.s key business structure and operations, history and products, and it provides summary analysis of key revenue lines and strategy. Use this report to understand the internal and external factors that affect Delta Air Lines, Inc.s performance in achieving its business goals. After eighty years of success history , On September 14 2005, Delta files for reorganization under Chapter 11 of the U.S. Bankruptcy Code. Northwest Airlines files for bankruptcy on the same day.After the bankruptcy, Delta spent millions to rebuild morale, flying in many of its 47,000 employees for a series of events that were equal parts team-building and tent revival. And Delta convinced creditors to cede 15% ownership to employees. They saw the importance Delta Airlines 10 of having the pilots and employees on board to unlocking the synergies of the deal, says Delta CEO Richard H. Anderson, a board member at the time who got the top job in August 2007. It was equally important for the employees to know that we followed through on everything we promised. Delta Air Lines plunged into bankruptcy in September 2005, marking the culmination of more than a decade of management missteps made largely out of hubris. The Southeastern airline allowed itself to go through many of the stages of decline outlined in Jim Collins new book. Its sense of infallibility helped foster an undisciplined pursuit of practically every new jumbo jet that aircraft manufacturers rolled out, forcing it to fly large planes even on one-hour routes. Add to that a distinct denial of the increasingly grim realities of the airline business, exemplified by the errors made earlier this decade by then-Chief Executive Leo F. Mullin. He launched the trendy Song discount airline, which fizzled amid high costs and stiff competition from JetBlue Airways. Worse, Mullin negotiated a 2001 labor deal that paid top pilots a record-shattering $300,000 a year. Management always had to have the biggest and the best, recalls a former exec. It was the Delta way. That strategy helped the Atlanta-based carrier rack up billions in losses, pushing it into bankruptcy. And management was so slow to accept its humbling fate that one bankruptcy judge told executives: I have not heard anything that I will say remotely impressed me that you have the money, the talent, or the thought that you could successfully reorganize in this case. Admits President Ed H. Bastian: There were periods when Delta could have been just 24 hours from disappearing. If the pilots had walked out, Im not sure we could have pulled through. Delta Airlines 12 Deltas people issues are best exemplified by a specific person, Leo Mullin, named CEO in 1997. A highly-publicized executive compensation scandal marred the trust between management and the rank and file. Delta filed for bankruptcy less than 18 months after he abruptly retired. Certain actions by Delta have not endeared the company to its employees. Massive layoffs in 2004 continued through 2005 and 2006 and have led to messy court actions. Employees and pilots have picketed airports. Recently the bankruptcy court terminated their pilot defined benefit plan. Delta also had a highly-publicized conflict with an employee develop into a court action when they fired flight attendant Ellen Simonetti (aka Queen of the Sky) who had become a well-known blogger. Delta has spent a lot of valuable time and resources in answer to low-cost fare competitors in the U.S. such as JetBlue and Southwest. Like a large 18-wheel truck trying to follow a motorcycle around town, this has been an awkward waste of energy. à ¢Ã¢â€š ¬Ã‚ ¢ Delta Express was started in 1996. Delta Express was not successful for two reasons. First, the fares were not as low as JetBlue or Southwest, and secondly, there was a perception problem since this was a deviation from Deltas image. Delta President Fred Reid We really found out that customers want to see something distinctive. We still found that people had this edge of skepticism about it that (Delta Express) was just part of Delta. . . . This is truly different. à ¢Ã¢â€š ¬Ã‚ ¢ Song followed in 2003. The business model was that it was cheaper to use larger planes if they were full. 757s are cheaper to operate than small planes if all the seats are filled.They upgraded the seats to leather and encouraged the staff to be friendlier. Passengers had a better experience on Song (the low-cost carrier) than on Deltas main operation. Delta Airlines 12 à ¢Ã¢â€š ¬Ã‚ ¢ Delta Shuttle was started in 1991 with the purchase of used Pan Am aircraft and continues today. The Delta Shuttles fly only between limited east-coast city pairs. à ¢Ã¢â€š ¬Ã‚ ¢ Delta Connections is a current subsidiary. Flights are flown by SkyWest, based out of St. George, Utah using Delta Connections branded Canada Regional Jets. Their website shows only airplanes in Delta Connections livery. These planes dont allow full-sized carry-on luggage; anything bigger than a laptop computer needs to be checked through the regular baggage claim or checked planeside. None of these attempts at a low-fare subsidiary have been entirely successful, and have detracted from rather than contributed to Deltas overall success as an airline. Presenting these multiple faces is confusing to the flying public.These repeated attempts to enter the low-fare market detract a significant amount of focus and resources from what Delta does best. In This Bird Wont Fly, The Travel Insider blog (in 2002 and updated in May 2006) calls this a Futile Act of Self-Cannibalism, indicating that the low-cost options have actually been competing against the main Delta service; and may have made its shortcomings more apparent. The most important part of the progress and survival of an airlines customer service Is listening to opinions and complaints from the customers, the airline can reinforce the weak spots. then reviews a inappropriate customer service ends up the image of the airline publicly. Some Complaints From Passengers Of Delta Airlines Sharlyn of Atlanta, GA July 30, 2009, I had a 4 1/2 hour flight from ATL to SFO on a 767 aircraft. I called the flight attendant using the help button on the computer screen to inform her that my overhead light would not come on. The flight attendant told me she would rebut my computer so I could use the overhead light and once she did, the light still did not come on. I told her I needed to use the overhead light to read business materials, etc. for a meeting and throughout the entire flight leaving at 21:15 pm (EST) to 23:30 pm (PST), I could not read over my business materials. The flight was not full, yet the flight attendant did not move me to another seat so I could read. I had eye surgery for a retina problem and had to strain my eyes in the dark, because the flight attendant refused to move me. This is very unacceptable considering that I have been a Delta Skymiles member since 1995. Lindsay of Los Angeles, CA July 20, 2009, We arrived an hour before our flight, checked-in using the self service kiosk, paid for an additional bag, and got in line to drop it off. The line was long and personnel continued to take those who were late and cut them in front of us. I told the stewardess that we ourselves might need to get to the front of the line and were likely later than those she was allowing to cut in front of us. She refused to listen to me and kept me in line. When we arrived at the counter the woman did not want to let us check our bag because it was less than 30min. before the flight. We asked to speak to her supervisor. She moved as slowly as possible and it took another 10min for her to actually take our bag which she finally had to do because we had already paid. When we got to the gate the plane was still there but they would not let us on as the gate had closed. I dont understand how they could hold us in line, and allow other people to cut in front of us because they may miss their flight, not do the same for us, and then not take responsibility when we missed our flight because of this. Usha of Finksburg, MD July 15, 2009, my husband, daughter and I went to Seoul in June 19th and scheduled to return to Baltimore on June 27th, so my daughter can fly to Chicago on 28th. But when we arrived at Atlanta arougn6:40, the flight stood on runway for about 2 hours because of gate issues. We all missed our flight and delta do not have another flight until next morning at 9:00, so my daughter missed her scheduled flight to Chicago and we have to pay full fare for the after noon flight ( which was about 250. They gave us a hotel which was so crappy, it stunk. Nathan of Hof Hacarmel, CA July 10, 2009, I must congratulate Delta airlines for being the first paperless fleet Ive had the discomfort of flying with. My flight DL87 leaving Tel Aviv, July 2, 2009, had reached a bit more than the halfway point when the hand towels, tissues and TOILET PAPER (!) all ran out in all four toilets. I walked to the rear of the plane and informed the service crew of the problem. They were woken out of the obvious stupor: Thank you sir for informing us. On of the lovely marched over the to toilette area with a hand full of paper towels, and, I assume, inserted them into the correct receptacle. The hygienic for a population of some 250 men, women and children was despicable and at best reprehensible. We have decided never again to fly Delta. Less than four years after it was left on life support, Delta is now the picture of health. Thanks to a management overhaul, a rigorous shift towards more profitable international routes, aggres