Education A Country s Civilization Depends Upon The...

â€Å"The claim of a country’s civilization depends upon the treatment to the minorities† - Mahatma Gandhi. India in its globalization era boasting about its nuclear power and information technology cannot deny the harsh realities of poverty, unemployment, over population, hunger, illiteracy etc. education is still continuing to be a luxury even for the middle class. Education plays a catalytic role in socio economic development of a country, education is not only an economic variable but is also socio economic variable. Education is the principal tool of social, development and unless all societies are provided with the right for of education, adequate in quantity and quality, it will not be possible to tackle satisfactorily the problems of†¦show more content†¦Any democratic society where such a large number of people are steeped in illiteracy, poverty and backwardness is doomed to disaster. Such a large percentage of backward people will be a milestone round the neck of the nation and their backwardness will impede progress of all. This fact of educational and economic backwardness of the Muslims has been conclusively established in several reports and surveys. The Gopal Singh Report, the Reports of 43rd Round and the 55th Round of the National Sample Survey and the Programme for Action under the New Education Policy of 1986 clearly show that the Muslim minority is educationally most backward segment of the nation. Backwardness is circular in nature. If a community is educationally backward, it also becomes economically backward and the economic backwardness leads to social backwardness which in turn reinforces educational backwardness. Education is one of the principal means available to foster deeper and more harmonious form of human development and thereby reduce poverty, exclusion, ignorance and oppression. It refines sensitivities and perceptions that contribute to national cohesion, a scientific temper and independence of mind and spirit, thus furthering the goals of socialism, secularism and democracy enshrined in our constitution. EDUCATIONAL STATUS OF MUSLIMS IN INDIA: Poverty and education have a well established

Juvenile Delinquency Essay - 2036 Words

nbsp;nbsp;nbsp;nbsp;nbsp;Juvenile delinquents, or youth that have been convicted of a crime, seem to be the norm these days. Citizens, families, and poliy makers want new programs and policies within the juvenile justice system. Researchers have found that the family structure can be a precursor to delinquent behavior, and families do not have the control or blance that they once did. As such, mew measures need to be implemented to help these families in crisis. Rehabilitation of the family unit is the answer, say many, not punishment. In response to this, new ideas have formed to rehabilitate the family unit, but first, the family structures that are precursors to delinquent behavior must be identified. â€Å"Family Life, Delinquency,†¦show more content†¦The researchers have found that single parent families correlated with juvenile delinquency, and children from single-parent homes were more likely to increase their delinquency as they passed through adolescence, whereas, children raised in two parent homes were more likely to desist from delinquent behavior as they matured. Family structures, such as, single-parent families and stepfamilies, seem to disrupt a child’s normal socialization process. In conclusion, the authors and researchers come to the agreement that â€Å"a healthy home environment is the single most important factor in preventing delinquent behavior,† (32). nbsp;nbsp;nbsp;nbsp;nbsp;In â€Å"The Path to School Failure, Delinquency, and Violence: Causal Factors and Some Potential Solutions,† the author also supports the theory that poor parenting is a key risk factor or precursor associated with delinquency. The author recognizes key risk factors of delinquency such as, â€Å"poverty, dysfuntional and chaotic families, incompetent parenting, and negative parental attitudes toward education† (Walker, 1999, p.2). These risk factors provide a fertile breeding ground for the development of delinquent attitudes and behavioral styles among the children exposed to them. At the core of Mr. Walker’s article is the fact that these risk factors need to be reduced and/or eliminated. Parents need to recommit themselves to raising their children safely and effectively.Show MoreRelatedJuvenile Delinquency1154 Words   |  5 PagesDiscussion In common parlance, there is an understanding of juvenile delinquency as meaning adolescents breaking the law or participating in mischievous behavior. Defining juveniles as being under the age of 18 years is the general rule of thumb because, in the current legal system, upon reaching this age individuals can be tried as adults, serve in the military, and, in some states, consume alcohol. (Reckless, 1972) One may ask why juvenile delinquency is viewed as a separate construct from adult deviantRead MoreJuvenile Delinquency2109 Words   |  9 PagesJuvenile Delinquency 1 Juvenile Delinquency: Features, Causes and Solutions Shen Cheng Class: 110 Teacher: Stephanie February 29, 2012 Juvenile Delinquency 2 Outline I. Introduction Thesis statement: Nowadays, there is no denying that Juvenile Delinquency has become one of the hottest social issues. The features, causes, and solutions of Juvenile Delinquency will be discussed about in this research. II. The features of Juvenile Delinquency A. The average age of juveniles who commitRead MoreJuvenile Delinquency2343 Words   |  10 PagesOpener: B. Thesis statement: This term paper explores how family issues attribute to juvenile delinquency and how to overcome it. II. First and foremost, an unstable family structure is one of the contributing factors to juvenile delinquency. A. Single-parent household vs. two-parent household B. Child maltreatment 1. emotional neglect 2. physical abuse III. Secondly, studies have shown that juvenile delinquency is conclusively related to the family environment. A. Family cohesion B. Increasing numberRead MoreJuvenile Crime And Juvenile Delinquency1322 Words   |  6 PagesVersion). Juvenile crime, in law, term denoting various offense committed by children or youth under the age of 18. U.S. official crime reported that in the mid-1900’s â€Å"about one-fifth of all persons arrested for crimes were under the age of 18† (Funk Wagnalls, 2014). Such acts are sometimes referred to as juvenile delinquency (Funk Wagnalls, 2014. Offering constructive programs reduces juvenile delinquency and reduces recidivism. â€Å"From the beginning, the principal consideration of the juvenile courtsRead MoreJuvenile Delinquency : Adult Delinquency2861 Words   |  12 PagesAlexis Kelly SOC 333 William Franks Spring 2015 Juvenile Delinquency Prevention Programs What is juvenile delinquency? Juvenile delinquency relates to minors who commit law violations. Instead of adults commiting â€Å"crimes’, juveniles are considered to commit â€Å"delinquent acts†. Society sees juvenile delinquents as immature and in need of guidance, which is different to adults, who are seen to be responsible for their crimes. Juvenile delinquency can occur in any community, neighborhood, and schoolsRead MoreJuvenile Delinquency2264 Words   |  10 PagesJuvenile Delinquency is the participation of illegal behavior by a minor who falls under a statutory age limit. A delinquent is a minor who commits a crime or a status offense. A status offense is conduct that is illegal only because the child is under age i.e. smoking cigarettes (Senna 10, 20). The cases of Eric Smith, Lionel Tate, and an unidentified NJ child are similar only because, they are guilty of killing another child, but the Criminal Justice System treated and punished them very different lyRead MoreJuvenile Crime And Juvenile Delinquency1458 Words   |  6 PagesDay in and day out residents and visitors to the Boston area are affected by juvenile crime and delinquency. Though the crime rates in MA and across the nation are on a steady decline, these juvenile crimes are still considered a serious matter that needs attention. It is thought that juvenile offenders do not cope as well with the criminal justice system as well as adults may be able to and therefore there needs to be a focus on how the system can better aid in the rehabilitation of these youthfulRead MoreJuvenile Delinquency Essay1646 Words   |  7 PagesA juvenile delinquent offense is an act committed by a juvenile for which an adult would be tried at a criminal court. New statistics give an alarming picture: juvenile delinquency is higher as never before. According to the census bureau, in 2008 there were 1,653,000 recorded delinquent offenses in the United States. This is a 23.6% increase from 1990 when 1,337,000 delinquent offenses occurred. Today, a lot of people demand lowering the age of criminal responsibility and draconian penalties (JensonRead MoreThe And Prevention Of Juvenile Delinquency970 Words   |  4 PagesJuveniles in the justice system is an issue relevant not only to people in the criminal justice system but to society in general. There have been a number of studies done that link serious behavior problems in children to adult criminal conduct. In more recent years, there has been more research done regarding the causes and prevention of juvenile delinquency. The Department of Juvenile Justice lists 3 broad categories with many subcategories to help us understand what contributes to juvenile delinquencyRead MoreJuvenile Delinquency Is A Problem1508 Words   |  7 PagesJuvenile Delinquency When looking into the history of United States and elsewhere juvenile delinquency is a problem and has been one for over a century. Like other systems in place, the system involving juvenile delinquents has gone through many stages. In the case of the juvenile delinquency, it has gone through four stages, with us presently in the fourth. The causes behind juvenile delinquency are still unknown even today. Some blame it on the current culture, the over-exposure to violence

Contingency Approach & Change Management Process - Free Sample

Question: Define contingency approaches to change, explaining how they differ from change management models. Describe the five main change approaches according to the Dunphy/Stace model of change. List and explain the 5 reasons why contingency approaches remain less prevalent (less popular) than the one-best-way change management approaches. State your personal point of view on whether contingency approaches or planned change management approaches make more sense and why. Answer: Introduction: The contingency approach is a management theory which says that the contingency theory depends on the context of situation and that the most rigid style of approach is inefficient in the long run. Contingency managers give attention to both the situation and their own styles of management and ensure that both of them interact appropriately. Contingency approach is important in organizations because of the learning experience from certain situations and using these experiences in managing future prospects of such situations. An advantage of contingency theory is that the managers adapt themselves to external changes and pressures and with time they become experiential leaders who are able to develop their skills in multiple areas (Businessballs.com, 2015). In this assignment, contingency approach and its relation with change management models have been discussed. In this regard, this essay throws light on the dunphy/stace model of change and the reasons why contingency approach is less prevalent than change management approaches is also discussed. Change management models vs. contingency approach to change: In the book leading change by john kotter change management is defined as an approach o transitioning teams, organizations and individuals to a desired future state. There are various change management models such as ADKAR model, Kotters 8 steps model, Virginia stair change process model, Bridges transition model and the Switch Framework model. Contingency approach dominates research and theory in the management literature it challenges the classical models and processes designed by management theorists such as Fayol and Taylor. The contingency approach to change assumes that people, situations, organizations change and vary over time. The change management models are useful in the way that they simplify and describe a process so that the principles can be applied and understood. Kurt Lewins unfreeze-Transition-refreeze model is well known as its easy to understand and it focuses on processes. Similarly the Adkar model is used in many organizations (Education Portal, 2015). It is a p ractical model of change that makes sense, simple to learn and focuses on outcomes and actions required for change. Thus in simple words, Contingency approach to change, state that there is no single fundamental rule of change which can be applicable to organizations. Organizations are different and they face different situations and it require different ways of solving those variables while change management believes that organizational change is an inevitable approach and changes should be implemented in organizations to gain lasting success and long term benefits. Dunphy/Stace model of change: Dunphy/Stace model of contingency approach of change is the most popular contingency approach. According to these two theorists, the change depends upon two major factors The leadership styles in implementing the change The level of change and how big it is. They proposed five major change approaches. They are: 1. Fine tuning, 2. Incremental adjustment, 3. Process reengineering, 4. Modular transformation and 5. Corporate transformation 1. Fine tuning: Most of the businesses are changing in all kinds of ways. Small changes can create extraordinary resistance and whilst implementing change in business may be easy care should be taken in deployment2. Incremental adjustment: Incremental adjustment in an organization can involve changing business emphasis, correcting faulty processes, reallocating staff and further more.3. Process reengineering: business process reengineering is a process where the principle is that where changes have limited effects, these implemented changes should be forgotten and change should be implied in a new way.4. Modular transformation: the next stage is modular transformation i.e. to take an entire business section and re-build and re-think it.5. Corporate transformation: Corporate transformations involve major changes of the entire company. In some cases, where the company has stagnated, the whole company needs to be transformed for the new markets and modern age (International Internation al, 2015). Contingency approach is less prevalent than change management approaches: Contingency approaches have remained less prevalent than change management approaches. There are many reasons why contingency approaches are not dominant these days. Firstly, the managers need to decide which way to pursue for changing the situation. Secondly, contingency approach focuses more on specific leadership style rather than on a specific set of change steps of action. Next, the paths of change create problems as it arranges changes among different leadership styles, different behaviors and different times. Finally, sometimes an organization needs to change only a part of problem but rather it changes the whole parts (Referenceforbusiness.com, 2015). For all these reasons contingency approach is not dominant than change management approach. Effectiveness of the Processes: According to my opinion, change management process should be more applicable than contingency approach. As change is a necessary part of all organizations and it needs to change frequently rather than adapting to old ways we should look forward and welcome the changes that the future has to present to us (Scheer, 2003). Contingency approach is not dominant nowadays as it does not prepare the employees for change rather it tells to wait for the problems to happen and then tackle those problems which is not viable. Thus change management process is more prevalent in todays world and is given the necessary recognition. Conclusion: Contingency approach is important in organizations because of the learning experience from certain situations and using these experiences in managing future prospects of such situations (Small Business - Chron.com, 2015). The change management models are useful in the way that they simplify and describe a process so that the principles can be applied and understood. Contingency approach is not dominant nowadays and change management is more prevalent. References: Businessballs.com,. (2015). change management principles, process, tips and change theory and models. Retrieved 18 February 2015, from https://www.businessballs.com/changemanagement.htm Education Portal,. (2015). Contingency Approach of Management: Definition, Example Quiz - Video Lesson Transcript | Education Portal. Retrieved 18 February 2015, from https://education-portal.com/academy/lesson/contingency-approach-of-management-definition-example-quiz.html International, K., International, K. (2015). The 8-Step Process for Leading Change - Kotter International. Kotter International. Retrieved 18 February 2015, from https://www.kotterinternational.com/the-8-step-process-for-leading-change/ Referenceforbusiness.com,. (2015). Contingency Approach to Management - organization, levels, school, company, business, Contingency perspective and organization theory. Retrieved 18 February 2015, from https://www.referenceforbusiness.com/management/Comp-De/Contingency-Approach-to-Management.html Scheer, A. (2003). Business process change management. Berlin: Springer. Small Business - Chron.com,. (2015). Contingency Approach Use in Business. Retrieved 18 February 2015, from https://smallbusiness.chron.com/contingency-approach-use-business-33893.html

The Impact of the A380 Project on the Financial Performance of EADS Essay Example For Students

The Impact of the A380 Project on the Financial Performance of EADS Essay ? Acknowledgements We would like to express our gratitude to the department for affording us the time and research facilities without which this report would not have been possible. Special thanks go to the head of department Dr. Anders Hederstierna, our supervisor Dr. Britt Aronsson and the course coordinator Dr. Klaus Solberg. Abstract Airbus has been making headlines in the past few months for all the wrong reasons. This iconic European corporation has undergone a turbulent period due to the problems surrounding the Airbus A380 project. A new flagship product that should have curved out an unassailable advantage for Airbus over Boeing went completely wrong. The Airbus A380 aircraft was a ground breaking concept that was meant to push EADS into a unique market segment. Instead, it threatened the very existence of the company and served as a catalyst for major surgery and a complete reorganization of the corporation starting from the top management down to the production floors. Numerous studies have been undertaken that have documented details of the Airbus A380 project and what, how and why it all went wrong. We will write a custom essay on The Impact of the A380 Project on the Financial Performance of EADS specifically for you for only $16.38 $13.9/page Order now The company and other stakeholders have been undertaking drastic steps to try and put the company back on track and ensure the survival of the commercial aircraft business unit. In this study we look at how the problems surrounding the Airbus A380 project have affected the financial health of EADS. The background to the problems and the financial performance of Airbus is studied and presented. A brief discussion of how the data we collected and used for the study and the data that we could not get access to is also presented early in the paper. From the data and analysis, a comparison of the two dominant players in the commercial aircraft manufacturing industry, Airbus and Boeing, is also undertaken. A brief highlight of the financial impact of a project in the computer/consumer electronics industry is also presented. Finally from these data and prior studies on this subject, we have tried to highlight the impact of the project on the short and long term financial direction of EADS. Table of Contents List of Tables6 6 List of Figures7 1 Introduction8 Theoretical Framework14 3 Data Collection25 4 EADS Background and Analysis27 5 Boeing Background and Financial Data50 6 Comparative Analysis of EADS and Boeing 59 7 Other Factors that Affected the Financial Health of EADS69 8 Long-Term Prospects72 9 Comparison to a Project in a different Industry78 10 Conclusions79 81 11 Future Work82 12 Reference List83 List of Tables Table 4. 1 Business Segment Data of EADS 36 Table 4. 2 Consolidated Cash Flow Statements of EADS. 36-37 Tabl e 4. Consolidated Income Statement of EADS.. 40 Table 4. 4 Consolidated Balance Sheet of EADS 40-41 Table 5. 1: Consolidated Statements for Boeing 55-57 Table 5. 2: Income Statements for Boeing. 57-58 Table 5. 3: Consolidated Cash Flow Statements of Boeing 58-59 Table 8. 1: The Order Book for A380 Aircraft 76-77 List of Figures Figure 4. 1: EADS stock ownership. 29 Figure 4. 2: EADS management structure.. 31 Figure 4. 3: Airbus management structure 32 Figure 4. 4: EADS divisions and revenue. 34 Figure 4. 5: EADS share price (25 Nov 05 to 25 Jun 07)†¦. 49 Figure 5. 1: Boeing distribution of stock. 51 Figure 5. 2: Boeing divisions, revenue and activities.. 52 Figure 5. 4: The management structure of Boeing.. 54 Figure 6. 1: Working Capital Boeing Vs EADS 61 Figure 6. 2: Revenue Boeing Vs EADS 64 Figure 6. 3: Airplane Delivery Boeing Vs EADS. 65 1 Introduction The commercial aircraft industry requires huge capital investments in manufacturing and research and development. This is a very competitive sector where industry consolidation has resulted in the emergence of two major players from either side of the Atlantic, EADS in Europe and Boeing in the United States of America. The two form a duopoly with market leadership in the sector largely rotating between these two corporate giants depending on the market dynamics. Commercial airlines and other air transport operators form the bulk of the customers. Governments are also important customers. The government involvement in the sector extends to investing, supporting (Aboulafia, Richard, 2000; O’Neal, Michael, 1990) and regulating. Any problems in the industry have implications that go well beyond the confines of the affected companies. Governments therefore subsidize and invest in aircraft manufacturing and research and development. This also serves to protect the highly skilled jobs in this sector and ensures that the respective countries remain technologically competitive (Wall, R. Sparaco, P, 2007). Big companies play an important role in the economics of the countries they operate in. They influence the conditions in the industries and directly impact employment rate in the countries where the manufacturing takes place. EADS and Boeing are the leading competitors in the aircraft manufacturing industry and demonstrate the high level of political interest in this sector and the way governments try to influence the business decisions made by such corporations (Wall, Robert Jens, Flottau 2007; Barrie, Douglas 2007). 1. Problem Definition Airbus is a subsidiary of EADS that has been a global leader in the manufacture of commercial aircraft. The launch of the A380 aircraft project was expected to become a huge success and elevate EADS to a new level of market domination. But following production delays and the cancellation of some orders for the A380 aircraft by some customers, the company found itself in a difficult position. The failure of a challenging project such as the A380 project can have far reaching financial consequences that could lead to bankruptcy. It could also serve to expose weaknesses and inefficiencies in the structure of an organization that could be a major hindrance to the success of a company. The popular media and professional journals have been full of news and articles concerning the problems with the A380 aircraft and Airbus in particular. The list of problems include workforce discontent, possible reduction in production activities, delivery delays, customer dissatisfaction and a lack of new orders, to mention only a few. The complex set of problems extends to the influence EADS has that can cause significant economic problems in the concerned countries. Numerous studies and articles have been written about EADS and the A380 project that catalogue the various organisational, technical and financial problems associated with the manufacture of the A380 super-jumbo aircraft. A systematic evaluation of the financial consequences of the project has not been carried out. 1. 2 Purpose The purpose of this research work is to evaluate the impact of the A380 project on the financial health of EADS. The following questions will be addressed: In the short run, what effect has the A380 project had on the financial performance of EADS? In the same period, what was the financial performance of Boeing, the direct competitor of EADS? Should EADS continue supporting the A380 project with additional financing? What long term financial impact will the A380 project have on the future of EADS? Finally, in order to fulfil the purpose we will also briefly discuss other factors that influenced the financial health of EADS, in addition to the A380 project 1. 3 Research Methodology The first stage of this research will involve reviewing the information that is available about the aircraft manufacturing industry with a focus on information about EADS and Airbus. Our focus will be on financial information. As a public company, EADS is obliged to publish financial data about the corporate structure and financial information containing revenues, profits and sales orders per EADS division such as Airbus. The A380 has been a major project at EADS for the past few years that has taken substantial preparations and investments amounting to significant annual expenditures (Thomas, J. , 2001; Gummesson, E, 2006). The main thrust of our research will be quantitative for aspects where we shall obtain the financial data needed to do the analysis. We shall also employ a qualitative approach to evaluate the leadership and organizational structure at EADS. To evaluate the financial impact of the A380 project on EADS, our primary focus will be on financial and ratio analysis of the company. We will examine the financial statements from EADS. This quantitative analysis will include the period from 2004 to 2005 that preceded the initial announcements delivery delay of the A380 as well as the period following the announcements, from 2006 to the first quarter of 2007. To analyze the changes in profits, revenues and cash flows, we will perform a comparative analysis of the years from 2004 to 2006 and evaluate the first quarter of 2007 in comparison to the first quarter of 2006. We will explore what influence the Airbus A380 project has had on the financial health of EADS. In order to get a clearer picture of the financial health of EADS, we will compare the financial performances of EADS and its main competitor, Boeing. The financial statements of Boeing Company are also generally available as it is a public corporation. Boeing has a similar structure, is engaged in the same activities and is comparable in size with EADS. Boeing also operates in the aircraft manufacturing industry, with its commercial aircraft unit also being the major part of the company’s activities. Therefore, the cross-company financial analysis between EADS and Boeing will provide some useful insights into the scale of the finanicial problems. Some A380 aircraft customers have already cancelled their orders and moved to Boeing instead. Since these two companies form a duopoly, most customers that leave EADS for Boeing increase the market share for Boeing. The foreign currency exchange rates between the US dollar and the euro have had an impact on the competitiveness of EADS. The manufacturing plants of EADS are located in Europe. The basic bills are paid in Euros (salaries, taxes etc), while customers outside Europe settle their contractual obligations in US dollars. The lead time between contractual agreements and actual aircraft deliveries, coupled with fluctuating US dollar versus euro exchange rate influence the financial performance of EADS. Depending on the direction the change takes, it can add to the losses from the A380 project, especially with the lead time from the date of agreement to the date of delivery being stretched by the delays The US dollar to euro relationship is therefore an area of interest, we will therefore analyze trends in exchange rates and evaluate its impact on EADS. We will also evaluate trends in stock prices of EADS and compare them to ones of Boeing. This will allow us to see how the market value of the company was affected by the A380 crisis and delivery delays. The market values of stocks are important indicators of financial stability and are of special interest to investors. Trends in the stock price will also show the possible direction of the company. A review of the financial position of EADS, that will include cash flows, revenues in total, total revenues and profits, revenues and profits by divisions in the period starting from 2005 to 2007 (both within the company and in comparison with Boeing), together with review of stock prices and exchange rates in 2005-2007, will help paint the picture of the A380 project impact on the short run financial performance of EADS. Evaluation of trends in profits and cash flows of EADS and review of order and delivery book of Airbus, the major source of revenues and cash flows for EADS will reveal the possible future direction of the company. Upon reviewing the trends in financial position of EADS (through ratio analysis) and examining the order or delivery book of Airbus, taking into account that this type of business involves cash transfers and recognition of revenues upon fulfilment of contracts, we will be able to determine how much of a burden the A380 project is for EADS and if the company can carry on without significant financial reorganization. Finally, we will briefly examine other factors which could additionally influence financial health of EADS. The corporate structure and leadership issues have important bearing on the operations of a company and could also influence financial state of a company. Our evaluation will be based on information from the companies on the existing organizational structures and scientific articles where available. Among others, the following issues will be examined: the composition of the Boards such as the number of independent directors and how focused the Boards are on business activities and how independent they are when making decisions. This will give us some insight into the efficiency of EADS as an organization, which has an indirect influence on profitability as well. The dynamics of exchange rates influence financial health of EADS as the company is based in Europe but sells big part of its products overseas. We will use data on exchange rates obtained from business media sources for this analysis. 1. 4 Possible Limitations We will be unable to accurately estimate certain values without sufficient data. This is a complex case, with several interrelated issues. We will use the available data. The available data will be sufficient to make qualitative conclusions as is usual in case studies. For example, without knowing the values of discounts offered to some customers, the values of penalties incurred, the impact of some customers exercising the option to buy alternative aircraft from Airbus, we may be unable to make exact quantitative conclusions on losses and net cash outflows from the project. We cannot definitely determine sources and values of external (from other projects) financing for the A380 project. We would liked to look at the A380 project appraisal (preferably with more comprehensive appraisal method, like NPV), but it will not be possible to do this as we will lack exact data necessary for this type of evaluation. The A380 project is an evolving story that has new developments all the time. The data from primary data that we sourced from some company’s websites may be skewed in favour of the respective companies as there is tendency for companies to put emphasis on positive information. 2 Theoretical Framework 2. 1 Introduction According to Brealey et al, 2006, managers are agents of the owners of the company, the shareholders. The manager’s main goal is to increase the value of the shareholders’ wealth. The board of directors are part of the corporate governance system and are meant to oversee the performance of the managers and strategic direction of the company. The board ensures that the managers are adequately compensated for the day to day running of the corporation and have the mandate to replace the managers if they do not deliver shareholder value or , among other reasons do not conduct the operations ethically or legally. There are several methods to evaluate potential success of a project in a company. This is an important step. In a large company and/or if a significant investment opportunity is considered, investment appraisal methods, such as NPV (Net Present Value) are applied. To analyse the impact of the A380 project on EADS, our approach was to look at the problem from three angles: the financial angle, the organisation structure (leadership and governance) and to compare EADS to a similar organisation. The theoretical foundations that we base our analysis on are described in the following sections of this chapter. . 2 Assessment of the Financial Health 2. 2. 1 Financial Statements – Ratio Analysis Potential investors, as well as other interested parties, always analyze past/present financial performance of a company before making investment. This is necessary to evaluate possibility of future returns. Trends in profits and cash flows of past few years not only show how effective was a company in the post, but can also indicate future direction of a company. Probably the best way to evaluate possible return from investment is by analyzing data available from financial statements of a company (40). The major financial statements are: Statement of Balance Sheet, Statement of Cash Flows and Income Statement. Income Statement is intended to disclose revenues and expenses, as well as profits of a particular period. It should be noted, that profits are often different from cash flows, as items like depreciation of fixed assets are not taken into account in net cash flow calculations, but they do influence profits. Statement of Balance Sheet shows the financial position of a company at a particular point in time. Namely, it shows the values of assets (both current and non-current), liabilities (both current and non-current) and equity. Following balance of Balance Sheet components is always maintained, if the statement is correctly prepared: Assets-Liabilities=Equity Statement of Cash flows discloses the way all cash resources have been used throughout a particular period of time. Cash Flow Statement consists of three basic parts: Cash Flows from Operating Activities, Cash Flows from Investment Activities and Cash Flows from Financing Activities. Income Statement, Statement of Balance Sheet and Cash Flow Statement can be analyzed to find out how effective the performance of a company in the past was and to forecast, what can be expected in the future. It should be pointed out, that basic financial statements of listed (parent) companies are readily available to general public (through company web sites, etc), while financial statements of subsidies (â€Å"daughter† companies), like Airbus, usually are not readily available. A. Millichamp, 1997, suggests three methods for assessing financial performance. Each figure (or number) in the financial statement should be compared with: 1) The corresponding figure of previous statements 2) The corresponding forecasted (budgeted) figure 3) The corresponding figure of another company in the similar business While comparison of subsequent statements of a company is important (to see improvements/backward steps etc), it is sometimes even more important and interesting to see how well a company is performing in comparison with direct competitor (e. g. in our case Boeing vs. EADS). The first method of assessment shows trends within a company, while cross-company evaluation shows if those steps are more effective than the ones taken by a competitor. Third method of an evaluation (i. e. comparison with budgeted values), while definitely being important, usually cannot be performed by an outsider, as budgets (i. . internal data) are rarely disclosed by companies. While comparison of absolute values of financial statements is often performed, comparison through financial ratios is frequently more relevant. Many financial values are inter-related. Besides, some trends are better seen through relative analysis of values, for instance, when two companies construct their financial statements in dif ferent currencies. Boeing does this in US dollars while EADS uses the euro. According to Williams et al, 2005, (p606): â€Å"Ratio is a simple mathematical expression of the relationship, of one item to another. .u69e1382ecf5ca546a058109ffc84c791 , .u69e1382ecf5ca546a058109ffc84c791 .postImageUrl , .u69e1382ecf5ca546a058109ffc84c791 .centered-text-area { min-height: 80px; position: relative; } .u69e1382ecf5ca546a058109ffc84c791 , .u69e1382ecf5ca546a058109ffc84c791:hover , .u69e1382ecf5ca546a058109ffc84c791:visited , .u69e1382ecf5ca546a058109ffc84c791:active { border:0!important; } .u69e1382ecf5ca546a058109ffc84c791 .clearfix:after { content: ""; display: table; clear: both; } .u69e1382ecf5ca546a058109ffc84c791 { display: block; transition: background-color 250ms; webkit-transition: background-color 250ms; width: 100%; opacity: 1; transition: opacity 250ms; webkit-transition: opacity 250ms; background-color: #95A5A6; } .u69e1382ecf5ca546a058109ffc84c791:active , .u69e1382ecf5ca546a058109ffc84c791:hover { opacity: 1; transition: opacity 250ms; webkit-transition: opacity 250ms; background-color: #2C3E50; } .u69e1382ecf5ca546a058109ffc84c791 .centered-text-area { width: 100%; position: relative ; } .u69e1382ecf5ca546a058109ffc84c791 .ctaText { border-bottom: 0 solid #fff; color: #2980B9; font-size: 16px; font-weight: bold; margin: 0; padding: 0; text-decoration: underline; } .u69e1382ecf5ca546a058109ffc84c791 .postTitle { color: #FFFFFF; font-size: 16px; font-weight: 600; margin: 0; padding: 0; width: 100%; } .u69e1382ecf5ca546a058109ffc84c791 .ctaButton { background-color: #7F8C8D!important; color: #2980B9; border: none; border-radius: 3px; box-shadow: none; font-size: 14px; font-weight: bold; line-height: 26px; moz-border-radius: 3px; text-align: center; text-decoration: none; text-shadow: none; width: 80px; min-height: 80px; background: url(https://artscolumbia.org/wp-content/plugins/intelly-related-posts/assets/images/simple-arrow.png)no-repeat; position: absolute; right: 0; top: 0; } .u69e1382ecf5ca546a058109ffc84c791:hover .ctaButton { background-color: #34495E!important; } .u69e1382ecf5ca546a058109ffc84c791 .centered-text { display: table; height: 80px; padding-left : 18px; top: 0; } .u69e1382ecf5ca546a058109ffc84c791 .u69e1382ecf5ca546a058109ffc84c791-content { display: table-cell; margin: 0; padding: 0; padding-right: 108px; position: relative; vertical-align: middle; width: 100%; } .u69e1382ecf5ca546a058109ffc84c791:after { content: ""; display: block; clear: both; } READ: Should Racist Speech Enjoy Protection under the Fi EssayEvery percentage may be viewed ad a ratio-that is, one number expressed as a percentage of another†. 2. 2. 1. 1 Ratio Analysis Assessment of three basic types of activities can be conducted to evaluate overall financial performance of a company (35). Changes since previous period show short term improvements/steps backward, while overall trends in years can also indicate what can be expected in the future. These three activities are: Liquidity, Profitability and Gearing/Leverage. It should be noted, though, that this is not a strict classification and some ratios may â€Å"belong† to more than one perform ance appraisal subgroups. For better representation of subsequent statements, they are usually placed next to each other and percentages of each corresponding values are also given. 2. 2. 1. 2 Liquidity Measures Liquidity of a company refers to its ability to manage short term obligations. Short term obligations are those ones, which should be repaid within a year. In other words, it is an ability to repay current liabilities with available current assets. Current assets are assets readily convertible into cash. While current liability is an obligation which should be settled within a year. The basic term often used in relation to Liquidity is Working Capital. Simply, it is an excess of current assets over current liabilities. Basic ratios used to assess liquidity of a company are: 1) Current Ratio=Current Assets/Current Liabilities It is a measure of how well are current liabilities covered by current assets. To some extent, the more it is (hopefully over 1. 5), the better it is for a company, but too high Current Ratio may imply that current assets are not entirely utilized. 2) Quick Ratio=(Current Assets-Inventories)/Current Liabilities It is a similar measure to Current Ratio, but with the exclusion of inventories-the least liquid current assets. Sometimes it is a more relevant measure. Again, a value of Quick Ration in excess of 1 is usually expected, but it varies from industry to industry. 3) Working Capital Cycle is considered to be an important illustrative measure of Liquidity. It is calculated in days/months. By Working Capital Cycle we measure the period from the date purchase of raw materials to the date of cash collection from products manufactured from those materials. Working Capital Cycle equals: Period to collect cash from customers+ period to turn over inventories- period to settle trade liabilities Days to collect cash from customers= (Average Receivables/Sales Revenues) x 365 Days to turn over inventories = (Average Value of Inventories/Cost of Sales) x 365 Days to settle trade obligations = (Average Payables/Cost of Sales) x 365 If average values are not available, year end values can also be used. Generally, the shorter is the Working Capital Cycle, the better it is for a company, as it is an indicator of effective performance. 2. . 1. 3 Profitability Measures Profitability ratios can help us evaluate trends in profitability and help us find out if a company earns sufficient profits in comparison with available resources. One thing should be noted here. If a company has a very high profitability but low cash balance, it can lead to a collapse-company can run out of cash. It is called Overtrading. On the other hand, excessive cash balance wi th corresponding low profitability is an indicator of Overcapitalization-sign of inefficient use of available resources (assets do not generate sufficient profits). Trends in Profitability can be measured both in absolute terms and with the use of ratios. Following measures are used: 1) Gross Profit Percentage: Gross Profit/Sales Revenue It is an indicator of what is percentage of Gross Profit from Sales Revenue Earnings per Share: Earnings for Ordinary Shareholders/Number of Outstanding Shares is an indicator of earnings for one share. Two important measure of profitability are also used to evaluate the efficiency in use of assets and equity to generate profits. Return on Equity = Net Profits/Value of Equity Return on Assets = Operating Profit / Value of Total Assets Maintenance of high levels of profitability is the primary objective of a company. It is a sign of relatively safe continuity. But as it was stated above, high levels of profitability should not be confronted with low Liquidity. 2. 2. 1. 4 Measures of Gearing and Leverage By Gearing we mean the ability of a company to meet long term debt obligations. Debt composition of Balance Sheet is an important indicator of Gearing. Higher share of long term debt in comparison with to equity is an indicator of higher Gearing. While, generally, long term debt is considered to be the least expensive source of finance (less expensive than common stock issue), too much reliance on debts puts accompany into danger, as interest on debt should be repaid (unlike dividends) regardless of profitability level. Good indicator of Gearing is the Debt Ratio: Debt Ratio= Total Liabilities/Total Assets Another indicator of Gearing is Interest Cover: Interest Cover= Profit before Interest and Tax/Interest Expense The higher it is, the easier it is for a company to settle its long term debt interest. This ratio is also related to Liquidity of a company. All above mentioned ratios are calculated from Statements of Balance Sheet and Statements of Income. Additionally, examination of Cash Flow Statements can reveal how cash is used in a company, which items of the statement are seem to generate more/less cash than was expected and by how much has cash decreased/increased in the considered period. 2. 2. 2 Limitations of Financial Evaluations using Ratios Financial analysis through ratios is an important and useful method to evaluate financial performance of a particular company. But this type of evaluation has its limitations. One can never make convinced conclusions purely based on ratio analysis. One of the reasons can be so called â€Å"window dressing†, i. e. a case when a company intensively â€Å"improves† performance by the end of accounting period to make year end financial statements look â€Å"attractive†. This can lead to incorrect assessment of a company. Besides, measures used in financial analysis are relative measures, which indicate to relative changes and therefore do not always allow us to make absolute judgments on companies (Millichamp A, 1997; Williams R. t al, 2005). Nevertheless, comprehensive (including cross-company) evaluation of company performance through financial ratios can disclose not only past problems of a company but even allow us make forecasts on future financial health of the company. This evaluation is well supplemented by other non-ratio financial indicators, like stock price trends and (where rele vant) trends in currency exchange rates. 2. 2. 3 Stock Prices The wealth of shareholders in a company is generated from: 1) Dividends received; 2) Market values of shares Return from investment to shareholders can be generated from both received dividends and from capital gain due to increase in value of shares. Very important measures a company value is market value of all its outstanding shares. In order to increase the value of a company, management should achieve high profits so that it could distribute higher dividends and insure high values of shares (to allow higher capital gains). When market value of shares is low, the possibility of takeover from an outsider company is more likely. What is also significant, value of shares and trends of share prices are very important indicators of a company financial health for a potential investor. It is taken into account together with financial statements of a company (Millichamp A. 1997, Brealey R. et al, 2006). 2. 3 Additional Factors that can affect the Financial Health In this section we look at other factors that can have a bearing on the finances of EADS as factors like corporate structure, leadership and foreign exchange rates can have an influence on the financial stability of a company or indirect impact on projects within a company. The indirect influence of factors like corporate structure and leadership is reflected in the ability to avoid or reduce the negative impacts caused by a project while fluctuations of exchange rates can magnify losses or profits from projects when exchange rates are either favorable or unfavorable. However, the primary purpose of this thesis is to look at the impact of the A380 project. 2. 3. 1 Leadership The corporate culture, leadership and governance of a corporation influences the way the success of a company. Dubrin A. , (2007) has further catalogued the types of leadership characteristics that are needed for organisational success. These are especially relevant in organisations of the scale and complexity of EADS or Boeing that depend on the creativity and the innovation of the workforce. Dubrin also describes leadership traits needed to effectively manage international or geographically dispersed companies that are also culturally diverse are also. Other characteristics that have relevance to our subject matter relating to Airbus and EADS include teamwork, leadership development, succession and transformational leadership skills are required to lead an organisation through a crisis. This list is not exhaustive, it only seeks to provide a brief background to some of the leadership failures that could have led to the problems at Airbus, impacted on organisational efficiency and subsequently translated into financial woes for the company. 2. 3. 2 Corporate and Governance Structure Organizational structure can play a vital role in the performance of a company. The way the board of directors coordinate performance of top management and the manner it communicates with groups of shareholders is often as important as contemporary financial health of a company. The central role in organizational structure belongs to board of directors which usually consists of 8-15 members in a large corporation. The board should be independent to ensure independent and objective reporting and decision-making of the board (15). According to Walter J. Salmon: â€Å"Inside directors are often too committed to tradition and their new ideas. Outside directors, without independent sources of information are usually only capable of anaemic discussion and dissent. The result: consumers, competition, technology, and the economy may all change, but the company fails to keep up† (15, p4). According to Walter J. Salmon, a board of 8-15 members is optimum, with at least 2/3 of it being outside directors. An empowered board (15) has the ability and independence to monitor activities of management and to influence top management to revise their activities if their performance does not correspond to the strategic direction of a company determined earlier. The board should monitor the performance of the CEO and interfere if the company moves in the wrong direction to improve things before further damage occurs. The following steps are essential for Board empowerment (15): Directors receive independent and competent information on the performance of a company in the most easy-to-understand format The board consists of independent, competent members. It is an integrated board. Members of the board freely and frequently communicate with each other The board members also monitor the performance of the board itself. They set objectives for themselves and try to achieve them. 2. 3. 3 Governed Corporation vs. Managed Corporation According to John Pound, there are two types of organizational structures: a governed corporation and a managed corporation. The board of directors has a passive role in a managed corporation. Its main tasks are monitoring and selection and appointment of top management. The managers retain all leadership and decision-making rights (15). It is not considered to be the best governance model nowadays. Today many problems of large organization do not stem from power imbalances, but rather from poor decision-making. The governed corporation model proposed by John Pound is designed to remove the imbalances of the managed corporation model. It is centred on the decision making process in the company. The board of directors, top management and shareholders are more integrated and share responsibilities in decision making and formulation of the strategic direction of a company. Managerial duties are retained by CEO’s, but the board is not a passive onlooker. 2. 3. 4 The Impact of Foreign Exchange Rates Exchange rate of a currency is a rate at which one country’s currency can be traded in exchange to another country’s currency. Basically, exchange rate is determined by supply and demand of currencies at exchange markets. Following factors influence exchange rates: Government policy to influence exchange rates (limitation of maximum exchange value etc) Interest rates in the countries of those currencies The rates of inflation in those countries Trends in exchange rates (Euro to Dollar) can become a source of troubles for both importers and exporters of products, because â€Å"actual† amount received by them can fluctuate as exchange rates vary (35). There are some measures to be taken in order to avoid or reduce negative influence of exchange rates: 1) Contracts can be agreed in local currencies (Euro, in case of EADS) 2) Outsourcing of some activities can be done, i. . a company, operating in foreign country can deal with local suppliers-sell products manufactured from local supplies to local market etc. The danger, regarding exchange rates, for an importer is that enough revenues in local currency should be earned so that upon exchanging domestic currency, expected value is obtained (Brealy R. , 2006) To reduce impact of negative excha nge rates, following measures can be taken: Matching of receipts and payments should be made. This implies offsetting payments in one currency, with receipts in the same currency Company can also make forward exchange contracts. It implies fixed exchange rate for the future cash transfers to/from importer/exporter. Employing options for future contracts Employing hedging. For instance, an exporter can hedge against exchange risks by converting foreign currency into domestic one at the spot rate 3 Data Collection The financial data used for this study was obtained from the statements published EADS and The Boeing Company. They are listed companies whose stock is traded publicly. They are therefore legally bound to publish this and other information for the benefit of stakeholders. This data included: Annual reports containing: Income statements, cash flows, financial statements/position, statements of operations, segment information and statements on shareholders equity. Stock price data was also available from the company’s websites. Additional information was obtained from the Annual Reports published by the European Union Transport Commission on airplane manufacturers, EADS and Boeing. Statistical information published by the United States Department of Transport Federal Aviation Administration was also examined. The financial data was used in the ratio and other financial analysis, we employed a quantitative method for this data. Additional information about the aeronautical industry in general and EADS, Airbus, the A380 project and The Boeing Company in particular was sourced from scientific journals and articles that are listed in the references section. Our requests for detailed and specific information about the A380 project such as details about the feasibility studies, financial and cost projections (the method and data applied for investment appraisal), and the organization of the project team did not bear fruit. We did however obtain information about the expected number of airplanes to be delivered over the lifetime of the project and the number of airplanes needed to be delivered for the project to breakeven. Other data that we could not obtain was pricing information of the airplanes the financial value of the penalties incurred when planes were not delivered, the value of the discounts and the value of the options that Airbus negotiated with customers for them to buy alternative aircrafts if they did not wish to wait for the A380. Information on leadership, governance and organizational structures of EADS and Boeing was obtained from the companies-this data is available to general public. We employed a qualitative approach to analyse and compare the leadership, governance and organizational structures of these two organizations. 4 EADS Background and Analysis 4. 1 Background and Corporate Structure European Aeronautic Defence and Space Company, EADS, is one of the largest aerospace corporations in the world. It was formed in July, 2000 after a merger of French company Aerposspatiale-Matra, Spanish company Construcciones Aeronauticas (CASA) and German company Daimler-Chrysler Aerospace AG (DASA). Currently there are 800 million EADS shares outstanding. 30% of the share capital is held by French shareholders, 22. 5% by Germans, 5. 5%-by Spanish shareholders and the rest of shares are held by various minority shareholders. The diagram below shows the EADS stock ownership. Figure 4. 1: EADS stock ownership The EADS Board of Directors consists of a maximum of eleven members appointed and removed by the shareholders’ meeting. EADS has two chairpersons and Chief Executive Officers. The Board of Directors determines the manner of appointment and the responsibilities of the Chairmen and the Chief Executive Officers. As of December 2006, EADS had over 116,000 employees. The management structure with the extension to Airbus is shown below. The corporate governance of EADS reflects the complexity of the company. EADS is a multi-national company, with significant shareholding from governments or state agencies. In order to balance the requirements of the different large shareholders, the company has two Chief Executive Officers (CEO’s). One of them is nominated by Daimler-Chrysler group and the second one is chosen by SOGEADE group. There are 10 directors in the Board of Directors at EADS. Similar to nominations of CEO’s, four members of the board are nominated by German Daimler-Chrysler and four other inside directors are nominated by SOGEADE (i. e. French and Spanish) group. There are two independent directors, one of them nominated by Daimler-Chrysler and second one by SOGEADE. The directors nominated by Daimler-Chrysler elect one CEO, while the second one is elected by SOGEADE. The Board of Directors appoints two chairmen (again, chosen by two large stakeholders). In case of dispute between two CEO’s the issue is transferred to the chairmen. Figure 4. 2: EADS management structure Figure 4. 3: Airbus management structure Manufacturing, production and sub-assembly of parts for the Airbus aircraft are distributed around 16 sites in Europe, with final assembly in Toulouse in France and Hamburg in Germany. These locations are: The EADS centers of excellence are organized as follows: The UK has 2 locations specializing in wings and electrics .uf6eff859ff7c041ef95977e79146b0d7 , .uf6eff859ff7c041ef95977e79146b0d7 .postImageUrl , .uf6eff859ff7c041ef95977e79146b0d7 .centered-text-area { min-height: 80px; position: relative; } .uf6eff859ff7c041ef95977e79146b0d7 , .uf6eff859ff7c041ef95977e79146b0d7:hover , .uf6eff859ff7c041ef95977e79146b0d7:visited , .uf6eff859ff7c041ef95977e79146b0d7:active { border:0!important; } .uf6eff859ff7c041ef95977e79146b0d7 .clearfix:after { content: ""; display: table; clear: both; } .uf6eff859ff7c041ef95977e79146b0d7 { display: block; transition: background-color 250ms; webkit-transition: background-color 250ms; width: 100%; opacity: 1; transition: opacity 250ms; webkit-transition: opacity 250ms; background-color: #95A5A6; } .uf6eff859ff7c041ef95977e79146b0d7:active , .uf6eff859ff7c041ef95977e79146b0d7:hover { opacity: 1; transition: opacity 250ms; webkit-transition: opacity 250ms; background-color: #2C3E50; } .uf6eff859ff7c041ef95977e79146b0d7 .centered-text-area { width: 100%; position: relative ; } .uf6eff859ff7c041ef95977e79146b0d7 .ctaText { border-bottom: 0 solid #fff; color: #2980B9; font-size: 16px; font-weight: bold; margin: 0; padding: 0; text-decoration: underline; } .uf6eff859ff7c041ef95977e79146b0d7 .postTitle { color: #FFFFFF; font-size: 16px; font-weight: 600; margin: 0; padding: 0; width: 100%; } .uf6eff859ff7c041ef95977e79146b0d7 .ctaButton { background-color: #7F8C8D!important; color: #2980B9; border: none; border-radius: 3px; box-shadow: none; font-size: 14px; font-weight: bold; line-height: 26px; moz-border-radius: 3px; text-align: center; text-decoration: none; text-shadow: none; width: 80px; min-height: 80px; background: url(https://artscolumbia.org/wp-content/plugins/intelly-related-posts/assets/images/simple-arrow.png)no-repeat; position: absolute; right: 0; top: 0; } .uf6eff859ff7c041ef95977e79146b0d7:hover .ctaButton { background-color: #34495E!important; } .uf6eff859ff7c041ef95977e79146b0d7 .centered-text { display: table; height: 80px; padding-left : 18px; top: 0; } .uf6eff859ff7c041ef95977e79146b0d7 .uf6eff859ff7c041ef95977e79146b0d7-content { display: table-cell; margin: 0; padding: 0; padding-right: 108px; position: relative; vertical-align: middle; width: 100%; } .uf6eff859ff7c041ef95977e79146b0d7:after { content: ""; display: block; clear: both; } READ: Ted Bundy (1453 words) EssayGermany has 7 locations specializing in cargo and cabin customization, forward and aft fuselage, vertical tail plane and electrics France has 4 locations working on nose and center fuselage And finally Spain has 3 locations that specialize in horizontal tail plane and A380 rear fuselage sections and belly fairing The major assembly and production is carried out in French and German factories and basic production associated with civil and military aircrafts. Besides aircrafts, EADS manufactures helicopters (it is the biggest helicopter producer in the world), satellites, missiles and other products. Airbus is a subsidiary and most important part of EADS and is involved manufacturing civil aircrafts. It is a direct competitor to the American aircraft-manufacturing company, Boeing. Airbus is a private company that is wholly owned by EADS. It has been the major generator of revenues and profits as well as cash for EADS. See the chart below that shows the size of the EADS divisions in terms of activity and revenue. Figure 4. 4: EADS divisions and revenue 4. 2 Airbus Airbus SAS is a subsidiary company of the EADS group and as stated earlier the company is one of the leading manufacturers of commercial aircrafts in the world. The main competitor of Airbus is The Boeing Company. Airbus recently increased its market share after obtaining larger number of orders and propelling it to number one in aircraft manufacturing and sales share. Airbus is a pan-European company that was founded in 1970. EADS initially had an 80% stake in Airbus with the remaining 20% held by the British company BAE Systems. In April 2006 BAE Systems sold its 20% stake to EADS through a put option, making EADS the sole owner of Airbus. The company manufactures aircraft components in four European countries: France, Germany, Spain and UK. Approximately 57,000 people are employed by Airbus. The company was formed as a European competitor to American aircraft manufacturing giant, Boeing. The first aircraft was manufactured by Airbus in early seventies but aircrafts of EADS had not been popular until 1981. Only after the launch of the A320 model in 1981 the company established itself as an important player in aircraft production business. Thereafter, the number of orders for aircrafts has been increasing significantly. Airbus manufactures the A300 range of aircrafts. Its smallest aircraft can accommodate 100 passengers. Recently it started the development of the A380 aircraft touted to be the biggest civil aircraft in the world with capacity to carry up to 850 passengers. Airbus competes with Boeing in similar aircraft market segments and also has different planes intended for different groups of customers, mainly airlines. 4. 2. 1 The Airbus A380 Project The A380 project was launched in December 2000. Jurgen Thomas was a Senior Vice President in the Large Aircraft Division of Airbus and gave a lecture that gave pertinent insight into factors that are taken into consideration when this project was undertaken. The following paragraphs summarise that lecture and present a background to the A380 project from its conception. The A380 was going to be the biggest aircraft ever built. It was meant to open up a new segment by addressing the changing market needs, congestion at the hub airports being one. With the environment having gained a profile, the A380 was designed with low emissions and low noise. The project took five years of preparatory development and testing that cost over US$600 million. The development cost was projected at US$10 billion and a tax windfall of 3 billion euro in Europe alone and induced worldwide employment creation of about 200,000 jobs. It was also going to give Airbus a foothold in all commercial aircraft market segments meant to challenge and surpassing Boeing in the over 500 passenger carrier aircraft segment as well. The innovative manufacturing processes and novel materials required for the aircraft meant that there were however, going to be little or no synergies between the manufacturing of the A380 and the other Airbus families of aircraft. Other factors that promised success for the project included the growth in air traffic that was twice the industrial average, increasing revenue per passenger, ground and air congestion and the availability of new technology to improve the economics of operating large aircraft (11,15). The aircraft had 50 firm orders immediately after it was launched. The market for the A380 was projected to be 1235 aircrafts, 8% of all commercial aircraft deliveries and worth around US$77. 4 billion. Numerous tests involving potential customers around the world were carried out. The A380 is the biggest civil aircraft in the world and is produced by Airbus with a capacity to carry between 555 and 850 passengers. The development of this aircraft was probably one of the most significant and expensive project in the history of Airbus. Before the development of this plane, it had been assumed that due to growing number of long-distance flights and corresponding increase in fees paid by airlines per landing, it was reasonable to construct a double-deck, large capacity aircraft. That type of plane would have been capable of minimizing the operating costs for airlines especially on long haul flights such as between Europe and the USA. The average price for one A380 was estimated to be US$ 290 million, making it, by far, the most expensive aircraft in the world. The first orders for the plane were received in late 2001 from Emirates Airlines for seven aircrafts. Further orders followed soon and the company seemed to be very successful in attracting new customers. In 2006, the first test flight took place. 4. 2. The A380 Project Crisis In order to become successful, the company needed to fulfil its delivery and manufacturing obligations to customers. That did not happen. In June 2005, Airbus announced that due to technical problems, mainly problems attributed to internal wiring in aircrafts, there were going to be delays in the delivery of the A380 to customers. Initially, the delays were scheduled to last six months. But on 13 June 2006, Airbus announced anoth er delay of further six to seven months. This caused major shifts in the delivery schedule. The company was not going to supply the promised quantity of aircrafts on time in the following years. As a result of delays the chief executive officers (CEO’s) of both EADS and Airbus resigned. The EADS share price fell by 26%. The effect the announcement of delays to the delivery of the A380 had on the stock is illustrated in figure 5. 2. Existing customers began to express their discontent and some of them cancelled the contracts with Airbus and chose to place new orders with the rival, Boeing instead. Airbus set up a research group to analyse the problems and find a way out of the crisis. Upon completing its internal review, the Airbus crisis research group decided that further delays in manufacture were unavoidable and on 3 October 2006 the new delayed schedule for delivery was announced. This meant further delays to airlines. For instance, the first A380 aircraft to Singapore Airlines is now expected to be delivered in October 2007. In November 2006 and in March 2007 FEDEX and UPS opted to abandon Airbus and chose 747 and 777 aircrafts from Boeing. The 747 and 777 planes do not have similar specifications to the A380. EADS is currently trying hard to retain the existing customers and orders. It has also tried to maintain its market share by allowing substantial discounts to existing and new customers. Heavy losses and significant cash flow shortages are affecting EADS now. 4. 3 Financial Analysis EADS The following tables contain EADS’ financial data that is used in subsequent ratio analysis and in the chapter comparing EADS to Boeing. Table 4. 1 Business Segment Data of EADS EADS Consolidated Cash Flow Statements(In Million Euros, for Years Ended by 31 December) 2006 2005 Profit for the Period Attributable to Equity Holders of the Parent (Net Income) 99 1,676 Profit Attributable to Minority Interests 16 4 Adjustments to Reconcile Profit for the Period (Net Income) to Cash Provided by Operating Activities Depreciation and Amortization 1,691 1,653 Valuation Adjustments and CTA Release 426 261 Deferred Tax (Income)/ Expense -193 386 Change in Tax Assets, Tax Liabilities and Provisions for Actual Income Tax -160 63 Results of Disposal of Non-Current Assets -336 -170 Results of Companies Accounting for by Equity Method -152 -210 Change in Current and Non-Current Provisions 2,150 175 Change in Other Operating Assets and Liabilities -143 1,239 Cash Provided by Operating Activities 3,398 5,107 Purchase of Intangible Assets 2,708 -2,818 Proceeds from Disposal of Intangible Assets 76 101 Acquisition of Subsidiaries and Joint Ventures -82 -131 Proceeds of Disposals of Subsidiaries 86 89 Payments for Investments in Associates and Other Investments and Long Term Financial Assets -421 -659 Proceeds from Disposals of Associates and Other Investments in Long Term Financial Assets 813 485 Dividends Paid by Companies Valued at Equity 46 36 Increase in equipment of Leased Assets -147 -40 Proceeds from Disposal of Leased Assets 215 256 Increase In finance Lease Receivables -16 -219 Decrease in Finance Lease Receivables 79 85 Disposal of Non-Current Assets/Disposal Groups Classified as Held for Sale and Liabilities Directly Associated with Non-Current Assets Classified as Held for Sale 690 0 Change of Securities 3,357 1,008 Change in Cash from Changes in Consolidation 0 12 Cash Provided by Investing Activities 1,988 -1,795 Change in Long-Term and Short-Term Financial Liabilities 784 -344 Cash Distribution to EADS Shareholders -520 -396 Dividends Paid to Minorities -16 0 Payments Related to Ability for Puttable Instruments -2,879 -93 Capital Increase 94 187 Purchase of Treasury Shares -35 -288 Cash Used for Financing Activities 2,572 -934 Effect of Foreign Exchange Rate Changes and Other Valuation Adjustments on Cash and Cash Equivalents -57 17 Net Increase in Cash and Cash Equivalents 2,757 2,395 Cash and Cash Equivalents at the Beginning of Period 5,386 2,991 Cash and Cash equivalents at the End of Periods 8,143 5,386 Table 4. 2 Consolidated Cash Flow Statements of EADS 2006 % 2005 % 2004 % Dev(05-06) Eu ro % Revenues 39,434 100 34,206 100 31761 100 5,288 15 Cost of Sales -34,722 -88 -27,530 -80 -25522 -80 -7,192 26 Gross Margin 4,712 12 6,676 20 6239 20 -1,964 -29 Selling, Administrative and Other Expenses -2,462 6 -2,336 -7 -2296 -7 -126 5 Research and Development Expenses -2,458 -6 -2,075 -6 -2126 -7 -383 18 Other Income 297 1 222 0 314 1 75 34 Share from Profit from Associates under Equity Method 189 0 225 1 84 0 -36 -16 and Other Income from Investments Profit Before Finance Costs and Income Taxes 278 1 2,712 8 2215 7 -2,434 -90 Finance Costs -244 -1 -177 -1 -330 -1 -67 38 Income Taxes 81 0 -825 -2 -664 -2 906 -110 Profit for the Period 115 0 1,710 5 1221 4 -1,595 -93 Attributable to: Equity Holders of Parent (Net Income) 99 0 1,676 5 1203 4 -1,577 -94 Minority Interests 16 0 34 0 18 0 -18 -53 Earnings Per Share Basic 0. 12 2. 11 1. 5 -1. 99 Diluted 0. 12 2. 09 1. 5 -1. 97 Table 4. 3 Consolidated Income Statement of EADS 2006 % 2005 % 2004 % Non-Current Assets Intangible Assets 10,855 15 11,052 16 10549 15 Property, Plant and Equipment 14,315 20 13,951 19 12956 19 Investments in Associates under the Equity Method 2,095 3 1,908 3 1738 3 Other Investments and Long-Term Financial Assets 1,666 2 1,938 3 2110 3 Non-Current Other Assets 4,231 6 3,610 5 2548 4 Deferred Tax Assets 2,624 4 2,980 4 466 1 Non-Current Securities 1,294 2 1,011 1 7096 10 37,080 52 36,450 51 37463 55 Current Assets Inventories 16,892 23 15,425 22 12334 18 Trade Receivables 4,852 7 4,802 7 4406 6 Other Current Assets 4,545 6 3,675 5 5242 8 Current Securities 549 1 4,189 6 0 0 Cash and Cash Equivalents 8,143 11 5,386 8 8718 13 34,981 48 33,477 48 30700 45 Non-current Assets/Disposal Groups Held For Sale 76 0 881 1 0 0 Total Assets 72,137 100 70,808 100 68163 100 Total Equity Equity Attributable to Equity Holders of the Parent Capital Stock 816 1 818 1 810 1 Reserves 7,593 11 8,699 12 7899 12 Accumulated Other Comprehensive Income 4,955 7 3,982 6 7678 11 Treasury Shares -349 0 -445 0 -177 24 13015 19 13054 19 16210 Minority Interests 137 0 153 0 144 0 13,152 19 13,207 19 16354 24 Non-Current Liabilities Non-Current Provisions 9,063 13 7,997 11 6074 9 Long-Term Financial Liabilities 3,561 5 4,189 6 4405 6 Deferred Tax Liabilities 2,465 3 2,376 3 4134 6 Other Non-Current Liabilities 12,680 17 11,295 16 10267 15 27,769 38 25,857 36 24880 36 Current Liabilities Current Provisions 3,631 5 2,727 4 2350 3 Short-Term Financial Liabilities 2,196 3 908 1 818 1 Liability for Puttable Instruments 0 0 3,500 5 3500 5 Trade Liabilities 7,461 10 6,634 10 5860 9 Current Tax Liabilities 218 0 174 0 178 0 Other Current Liabilities 7,646 25 17,739 25 14223 22 31,152 43 31,682 45 26929 40 Liabilities Directly Associated With Non-Current Assets for Sale 64 0 62 0 62 0 Total Equities and Liabilities 72,137 100 70,808 100 68163 100 Table 4. 4 Consolidated Balance Sheet of EADS 4. 3. 1 Ratio Analysis of EADS from 2004 to 2006 4. 3. 1. 1 Liquidity For the years 2004, 2005 and 2006 Liquidity condition was quite good and become even better in 2006. As the first news on delivery delay appeared in June 2005, it can be expected to see more trends in 2006 and 2007-impact of financial performance usually takes time to become evident. Working capital in 2006 was 34,981 31,152 = 3829 That is more than in 2005: 33477 – 31682 = 1795, more by 113% Between 2004-2005 working capital decreased by 1,976 million euros, 53% decline. Therefore, following decline in 2005, Working Capital recovered in 2006. As for most liquid current assets like cash and cash equivalents with currents securities (accounting treatment of both has been changing over years but sum of them can be compared) 9% increase in 2005 was followed by decrease in 2006. Both Liquid and Quick Ratios are slightly improved in 2006: 2004 2005 2006 Liquid Ratio 1. 14 1. 05 1. 12 Quick Ratio 0. 68 0. 56 0. 58 Although, generally, quick ratio is expected to be above 1, due to high value of EADS inventories and the peculiarity of the industry this level seems to be acceptable. But overall working capital balance is only increased by 4%, because significant cash increase is balanced by substantial reduction in current securities. Let’s have a look at inventory turnover: Increase occurred in 2006 after significant decline in 2005. 2004 2005 2006 2. 06 1. 78 2. 05 To complete the picture, it is reasonable to calculate working capital cycles in days (365 days per year): Days to collect Receivables Days to pay Payables Days to Sell Inventories Working Capital Cycle 2004 47 (84) 176 139 2005 51 (88) 205 168 2006 45 (78) 178 145 Again, some improvements are seen in 2006 after working capital cycle became longer in 2005. At first, days to sell inventories figures seem to be quite high but it is generally due to the nature of the industry. Cash flows provided by operating activities reduced by 1,709 million Euros in 2006, although are still much higher than net profit. 4. 3. 1. 2 Profitability The increase in total revenues in 2005 was 8%, it continued to increase up to 15% in 2006. It is a significant increase. But although percentage increase in cost of sales was 8% in 2005 (in comparison to 2004), it rose to 26% in 2006, leading to 29% decline of Gross margin in 2006. Net profit over 3 year period has been changing quite significantly, it was 5% of revenues in 2005, 4% of revenues in 2004 and almost equal to zero in 2006. The contributions from Airbus revenues in EADS total revenues have been stable equal to 63% in each research years (2004-2006). Contributions from Airbus in Earnings before Interest and Tax figure of EADS have been substantial. It was equal to 78% in 2004, 80% in 2005. It was 1919 millions in 2004, 2307 in 2005 and -572 in 2006, which is a radical drop of earnings in 2006. Therefore it is clear that substantial drop in Airbus is solely responsible in EADS being almost non-profitable in 2006 (just 399 millions in 2006, while it was 2852 in 2005 and 2432 in 2004). Therefore it can be concluded that difficulties in Airbus (exclusively) led to profitability crisis of EADS in 2006. In the following paragraphs we analyze how effectively the company used its resources and perform a ratio analysis of profitability. Earning per share figures were 1. 5 euro in 2004, 2. 11 euro in 2005 and just 0. 12 euros in 2006. These changes can be exclusively attributed to trends in earnings over years as actual number of outstanding stock has not changed significantly (in percentage terms). The number of outstanding shares was 797,000,000-802,000,000. Return on Assets (ROA): 2004 2005 2006 3% 3% 0% ROA=Operating Income/Average total Assets Return on Equity (ROE): 2004 2005 2006 7% 13% 0% ROE=Net Income/Average Total Equity As both operating and net income in 2006 was very low it is not surprising that ROA and ROE were equal to zero. Both equity and assets were employed very poorly and in particular, because of poor performance at Airbus. In 2004-2205 ROA remained constant as both operating income and Total assets changed slightly and to the same direction (both increased slightly). ROE was higher in 2005 than in 2004 because total equity reduced in 2004, while net income increased. 4. 3. 1. 3 Gearing/Leverage For a complete picture it is necessary to evaluate Gearing in each year. Non current liabilities increased just by 1% in 2005, but rose by 7% in 2006. Debt Ratio = Total Liabilities / Total Assets 2004 2005

s Daughter

â€Å"Rappaccini’s Daughter† In the article â€Å"Rappaccini’s Daughter,† (Short Sotry Criticism 192), Jones asserts the question, â€Å"How can Beatrice, with a mortal father on the scene, be an allegorical figure of Eve† (193)? By leaving the question to us we are lead to believe that this comparsion can be made. Even though Beatrice had a mortal father on the scene, she can be an allegorical figure of Eve because Eve was lead to believe that the â€Å"apple† was good for her. Eve was decieved by Satan and Beatrice was deceived by her father. They both were confined to the garden and were expected to tend to it. Jones also contend, â€Å"How can this be the present Eden, a representation of man’s perverted re-creation...† (193)? It can be the present tense Eden because when God created Eden he did so for his pleasure. Rappaccini also created â€Å"Eden† for his pleasure because his love for science. The difference in God’s Eden and Rappaccini’s perverted re-creation was that Rappacini made all of his beautiful flowers poisonous. He created nothing that was good. Therefore , it was understandable why Beatrice referred to God’s Eden as paradise and her father’s version of Eden as a place of poisonous flowers. Jones interestingly refers to Rappaccini as a type of â€Å"santanic intellectual† (193). This is an understanable statement because Rappaccini was a brilliant scientist. He purposely corrupted the beautiful garden and his own child for experimental purposes. Jones implies that Rappaccini is â€Å"Adam† and that Satan inspired Adam. He contends, for it was Adam, inspired by Satan, whose rebellion dethroned the rightful ruler of nature and put into man’s hands the power to rule and to recreat† (193). This is a disputable argument, because Adam was not inspired by Satan. Adam was inspired by Christ, but he was greatly influenced by Eve. On the other hand, an argument can be made that Eve was insp... 's Daughter Free Essays on Rappaccini\'s Daughter â€Å"Rappaccini’s Daughter† In the article â€Å"Rappaccini’s Daughter,† (Short Sotry Criticism 192), Jones asserts the question, â€Å"How can Beatrice, with a mortal father on the scene, be an allegorical figure of Eve† (193)? By leaving the question to us we are lead to believe that this comparsion can be made. Even though Beatrice had a mortal father on the scene, she can be an allegorical figure of Eve because Eve was lead to believe that the â€Å"apple† was good for her. Eve was decieved by Satan and Beatrice was deceived by her father. They both were confined to the garden and were expected to tend to it. Jones also contend, â€Å"How can this be the present Eden, a representation of man’s perverted re-creation...† (193)? It can be the present tense Eden because when God created Eden he did so for his pleasure. Rappaccini also created â€Å"Eden† for his pleasure because his love for science. The difference in God’s Eden and Rappaccini’s perverted re-creation was that Rappacini made all of his beautiful flowers poisonous. He created nothing that was good. Therefore , it was understandable why Beatrice referred to God’s Eden as paradise and her father’s version of Eden as a place of poisonous flowers. Jones interestingly refers to Rappaccini as a type of â€Å"santanic intellectual† (193). This is an understanable statement because Rappaccini was a brilliant scientist. He purposely corrupted the beautiful garden and his own child for experimental purposes. Jones implies that Rappaccini is â€Å"Adam† and that Satan inspired Adam. He contends, for it was Adam, inspired by Satan, whose rebellion dethroned the rightful ruler of nature and put into man’s hands the power to rule and to recreat† (193). This is a disputable argument, because Adam was not inspired by Satan. Adam was inspired by Christ, but he was greatly influenced by Eve. On the other hand, an argument can be made that Eve was insp...

Understanding How the Earths First Forests Developed

Understanding How the Earth's First Forests Developed The vascular plant emerged around 400 million years ago and started Earths forest-building process during the Silurian geologic period. Although not yet a true tree, this new member of the terrestrial plant kingdom became the perfect evolutionary link (and the largest plant species) with developing tree parts and considered the first proto-tree. Vascular plants developed the ability to grow large and tall with massive weight needed for the support of a vascular internal plumbing system. The First Trees The earths first real tree continued to develop during the Devonian period and scientists think that tree was probably the extinct ​Archaeopteris. This tree species followed later by other tree types became the definitive species comprising a forest during the late Devonian period. As I have mentioned, they were the first plants to overcome the biomechanical problems of supporting additional weight while delivering water and nutrients to fronds (leaves) and roots. Entering the Carboniferous period around 360 million years ago, trees were prolific and a major part of the plant life community, mostly located in coal-producing swamps. Trees were developing the parts that we immediately recognize today. Of all the trees that existed during the Devonian and Carboniferous, only the tree fern can still be found, now living in Australasian tropical rainforests. If you happen to see a fern with a trunk leading to a crown, you have seen a tree fern. During that same geologic period, now extinct trees including clubmoss and giant horsetail were also growing. Evolution of the Gymnosperms and Angiosperms Primitive conifers were the next three species to appear in ancient forests around 250 million years ago (the late Permian to Triassic). Many trees, including the cycads and monkey-puzzle tree, can be found around the world and are easily recognized. Interestingly, the very familiar ginkgo trees ancestor appeared during this geologic period and the fossil record shows the old and the new to be identical. Arizonas petrified forest was a product of the rise of the first conifers or gymnosperms, and exposed fossilized logs are crystallized remains of the tree species Araucarioxylon arizonicum. There was another type of tree, called an angiosperm or hardwood, making headway during the early Cretaceous or about 150 million years ago. They appeared at about the same time geologists think the earth was breaking up from a single continent called the Pangaea and dividing into smaller ones (Laurasia and Gondwanaland). Early into that Tertiary period, hardwoods exploded and diversified themselves on each new continent. That is probably the reason hardwoods are so unique and numerous across the globe. Our Present Evolutionary Forest Few dinosaurs ever made a meal on hardwood leaves because they were rapidly disappearing before and during the beginning of the new age of hardwoods (95 million years ago). Magnolias, laurels, maples, sycamores, and oaks were the first species to proliferate and dominate the world. Hardwoods became the predominant tree species from mid-latitudes through the tropics while conifers were often isolated to the high-latitudes or the lower latitudes bordering the tropics. Not a lot of change has happened to trees in terms of their evolutionary record since the palms made their first appearance 70 million years ago. Fascinating are several tree species that simply defy the extinction process and show no indication that they will change in another dozen million years. I mentioned ginkgo earlier but there are others: dawn redwood, Wollemi pine, and monkey puzzle tree.

Personal Journal Statement Example | Topics and Well Written Essays - 2500 words

Journal - Personal Statement Example However, I noticed a big change in my lifestyle. With all the pressures of being a student and living on my own, I have realized that it was too soon that I have changed physically. Although I am very active and busy, I have gained a lot of weight in the past year. When I arrived here, I was of average weight. Later, when I visited my family last December, I received comments that I have become bigger. Some said that I looked cute with my slightly chubby cheeks, others said I looked more mature (I am not sure if this is a compliment or what) than my age. I guess what they wanted to say was for me to go on a strict diet lest I wanted to join â€Å"The Biggest Loser† on TV. Of course I don’t want to face that kind of challenge and shame (friends here and back home would be watching and laughing at me). Neither do I want to grow old a big fat man. For this reason, I thought of shedding some pounds so I could keep on playing my favourite sport even if I grow older. Getting slimmer could also lower risks of heart disease and other sicknesses. Therefore, it is something I should take seriously in the next few days or months. I have not made a diet plan and I think I need to research on this to find out what I should eat and drink while trying to become physically fit. Anyway, I have a strong feeling that I need to really lose some weight because I am getting lousy at football. My friends whom I play with are better. They could run faster straight to the goal while I lagged behind, feeling sorry for being this heavy. I wish losing weight would be that easy and manageable, something that could happen in a click. Nevertheless, I also know that I have to work out and really face the problem because if I don’t, I would go bigger and bigger and become unmanageable. I swear, one of these days, I’m going to create a diet and exercise plan good for at least two months. The diet plan that I should make has to be

Voluntary Service at a Food Pantry on March 28, 2015 Assignment

Voluntary Service at a Food Pantry on March 28, 2015 - Assignment Example The  report outlines that "I was keen to note that the food supply did not include fruits. Evidently, the fact that the food pantry did not supply fruits translated to an imbalanced diet for the community members. Therefore, I played an active role in donating raisin fruit. The fruits I donated amounted to 8 pounds in weight (Basavanthappa, 2008). It was a real privilege for me to contribute positively to improving the health of the community members. Many of the community members who receive food supplies from the pantry are not financially stable and require the help from well-wishers. However, they deserve to have access to a balanced diet that can help in promoting their health. Therefore, when I had the opportunity of providing them with fruits, I felt privileged because I knew that my contribution was worthwhile. In addition, the experience helped me to understand the health needs of the people especially those related to nutrition. According to my observation, the food pantry seeks to supply food to the needy in the society. They give a special focus to the elderly who are unable to earn a living. However, the pantry also seeks to ensure that the needy in the society have access to food. The qualification for accessing the foods from the pantry is that one must be living or working in Highland Park. Foods are supplied in accordance with the level of need. The food pantry carries out rigorous research in an effort to ascertain the different needs of people. Therefore, the donations from churches, schools, and other well-wishers are channeled to the neediest people in the society. In my opinion, the food pantry had its priorities right because it recognized the vulnerability of the elderly as a needy group in the society. However, the food pantry also supplies foods to community members of different ages.

Everyone Has The Right to Privacy Essay Example for Free

Everyone Has The Right to Privacy Essay Everyone has the right to privacy. This is the right to not have details about our lives to be held or circulated without our knowledge/consent. Data of personnel nature are collect every so often by organisations. For example: * Employers hold personnel records that include data on address, age, qualification, salary, sick leave and so on. * Stores hold detail on credit card payment, accounts history, items purchased; * Banks hold details on salary, income and withdrawals, direct debits to various organisations; * Insurance companies hold detail on property, cars, accidents, claims and health. This list is endless. Modern technology has made it possible to store vast quantities of data, so that it can be viewed from all over the world and so that it can be used to create a profile of an individual. Threats to information Systems Organisations can protect the integrity of data (by preventing inaccurate data entry, malicious or accidental alteration), and simple measures can be taken to protect the security of data form theft or destruction. Data Integrity This refers to the correctness of data. The data held on a computer may become incorrect, corrupt or of poor quality. This could happen at different stages of data processing. 1. Errors in the Input. Data may be keyed in wrongly. 2. Errors in Operating Procedure. An update program may be ran twice in error, thus the master file would be updated twice. 3. Program errors could lead to corruption of files. A new system may have errors in it which may not surface for some time, but they may be introduced during program maintenance. Standard Clerical procedures To protect against input and operating, procedures can be documented and followed for both input and output. Input * Data entry must be limited to authorized personnel only * In large volume data entry, data may be verified (keyed in twice), to guard against keying errors * Data control totals must be used wherever possible to verify the completeness and accuracy of the data, and to guard any copying/duplication or illegal entry. Output * All output must be inspected for reasonableness and any inconsistencies investigated. * Printed output containing sensitive information should be shredded after use. Write-protecting Disks Write-protecting disks and tapes can be used to avoid accidental overwrite on a disk or a tape. This can be effective against an operator error. Both disks and tapes have write-protecting mechanisms. User IDs and passwords Each user in an organisation who is permitted to the access of the company database is issued with a user id and a password. In most cases there are certain levels of access at which employees can access data. Some of the most common password rules are: * Passwords must be at least six characters * The password display must be automatically suppressed on the screen or printed output * Files containing passwords must be encrypted * All users must ensure that their password is kept confidential, not written down, not made up of easily guessed words and is changed at least every three months. Access rights Even authorized users don not normally have the right to see all the data held on a computer. e.g. A hospital receptionist may have the right to view and change some patient details, such as the name, address, and appointments. But they may not have access to the patients medical file. Access rights to data could be set to read only, read/write or no access. This way a user in a company can gain access to data which they are permitted to see and can only change data if they are authorised to do so. Likewise, the computer it self can be programmed to allow access to data from a particular terminal, and only at a certain time of day. The terminal in the administrators office may be the only terminal which has authorisation to change the structure of a database. An access directory can be made, which shows each users access rights. Securing against fraudulent use or malicious damage Organisations are often exposed due to: * The possibility of fraud; * The deliberate corruption of data by unhappy employees; * Theft of software or data which may fall into the hands of their competitors. Measures to oppose these risks are as follows. * Careful selection of employees * Immediate removal of employees who have been sacked or who hand in their resignation, and the cancellation of their passwords and authorisation. * Separation of duties. This is to ensure the involvement of two or more people to defraud the company. * Prevention of unauthorised access by employees and others to secure areas such as computer operations rooms, by the use of machine readable cards/badges or other types of locks. * The use off passwords to gain access to databases. * Educate staff to be aware of security breaches, and to be alert in preventing them or reporting them. * Appointing a security manager who can, with the use of special software, monitor all computer screens. The special software can also be used to record all logins at each terminal, time of logins and the number of times particular software is used. It will even log the security managers activities. Protection against Viruses Steps can be taken to minimize the risk of suffering damage from viruses: * Making sure that all software which is purchased is in sealed, tamper-proof packaging; * Not permitting floppy disks carrying software of and kind to be removed from or brought into the office; * Using ant-virus software to check all applications brought into the office. Biometric security measures Biometric methods of identifying an authorised user are fingerprint scanning, voice recognition and face recognition. One such system uses infra-red scanners to capture the unique pattern of blood vessels under the skin. This system can even differentiate between identical twins by comparing the scans. Communications Security Telecommunications systems are vulnerable to hackers who discover user ids and passwords and can gain access to a database from their own computer. One way to avoid this is to use call-back procedure. This is when a remote user logs on, the computer automatically calls that user back on a pre-arranged number to confirm the log on. Data encryption can also be used to scramble highly sensitive or confidential data before transmitting it. Disaster Planning No matter what precautions are taken, the possibility of data being destroyed is always great. A simple disk head crash can destroy a disk packing a fraction of a second. System designers must provide a reasonable backup facility that does not degrade the performance of the system and is not very expensive. The cost of lack of planning for a computer failure can be ruinous. Periodic Backups The most common way to ensure that data is not lost is to make regular copies of files into a safe place. This is called Periodic Backups. This scheme has several weaknesses: * All updates to a file since the last backup may be lost; * The systems may need to be shut down during backup operations; * Backups of large files can be time consuming; * When a failure occurs, recovery from the backup can be even more time consuming. A benefit is that files which may have been fragmented can be reorganised to occupy smaller amounts of same, resulting in faster access time. It is important to store copies of data in secure areas. One copy of data can be held in a fire-proof safe in a building and another off-site. Recovery procedures A contingency plan needs to be developed to allow rapid recovery of major disruptions. It is necessary to do the following in backup procedures: 1. Identify alternative compatible equipment and security facilities, or implement a service agreement which provides equipment when needed. 2. Have provision for alternative communication links.

The Lust For Power: How Politics And Personal Relations Become One Essa

The Lust For Power: How Politics and Personal Relations Become One   Ã‚  Ã‚  Ã‚  Ã‚  The stories of the Bible reveal a pattern of â€Å"ups and downs† for the nation of Israel. A period of prosperity, faithfulness and fearing God would almost always be followed by a period of destitution, lawlessness and idolatry. This recurring cycle can be linked to political authority, and the level of separation of political authority from other influences. The successful struggle for liberation under the leadership of Moses and the glorious conquest of Canaan under Joshua instilled a fresh breeze of hope and a renewed faith in God in the nation of Israel. Guided by God, the nation of Israel met with unprecedented success as they journeyed to the promised land. During this time, political authority among the Israelites rested in the hands of patriarchs, or prominent members within the tribes. These men were righteous figures of authority, chosen by God, to lead His people and to teach His ways. The success that swept over the Israelites was short-lived, however, and for the next two hundred years the people of Israel struggled against neighboring tribes. The new generation of Israelites â€Å"knew neither the Lord nor what he did for Israel† (Judges 2:10). They began to â€Å"do evil in the eyes of the Lord† by worshipping other gods and engaging in various sexual activities. To save His people from their enemies and from their â€Å"evil ways,† God â€Å"raised up† judges to rescue them (Judges 2:16). These so-called judges had the political authority vested in them to lead the people of Israel and to save them from their sins. They mobilized the people of Israel against invasions of the tribes all around them. At this time, the nation of Israel was nothing more than a loose confederation of twelve tribes. Israel had no central authority, which meant no unity, no organization and no power. During the period of the judges, there was no need for a central government, because the people of Israel were able to defend their tribal territories effectively against adjoining peoples. Whenever there was a threat from a neighboring tribe, God sent a judge to lead the Israelites against their enemies. As this era came to an end, however, the Israelites were faced with a much larger problem - the Philistines' military threat. As the Israelites were elimina... ... fighting for it. The judges were sent to lead the Israelites in times of need and emergency. Their leadership was only ephemeral, and thus not one of them were able to gain an exorbitant amount of political power. When the period of the monarchy was firmly in place, however, there was a system of succession of power. Even before the king muttered his last words, there were peopleeagerly waiting in line to take his place. And if that wasn't enough, people were plotting against the king in hopes of succeeding the throne, even his own sons. This feature of the period of the monarchy allowed for the mixing and intertwining of politics and personal relations. The use of women as symbols of power and dominance became abundant as kings challenged the prospective successors, and as prospective successors challenged the kings. Events took place that can be compared to episodes of TV soap operas or Melrose Place. Politics and personal relations became interrelated, and above all else, the underlying reason was power. As people began to lust for power, for wealth, and for recognition, the association of the two became imminent, and the separation of the two became impossible.