People Only See What They Are Prepared to See Essay

Ralph Waldo Emerson once said, â€Å"People only see what they are prepared to see.† A statement so veridical, that the people to whom it implies are either not capable of understanding it or simply cannot accept it. In fact, most of humanity can read the undeniably prodigious quote ad infinitum, without comprehending the profound meaning behind it. There are four types of individualities, each reacting to the quote in a different manner. And how individuals react to it, determines their general responses to the situations which life brings upon them. Innocent minds are unable to adequately understand the significance of the quote. Because of their naivety, they are neither able to respond intelligibly to the quote, nor to most situations in life. They are gullible and non-opinionative, thus, only seeing what others want them to see. The majority of people so caracterised are infants and young children. They fail to look at things from various perspectives because they have not yet had enough experience in life. For instance, if you speak of war with a child, he or she will not know how to respond. The mind of the person is too young for knowing what to do when spoken to about political conflicts, patriotisms, warfare, death and other serious matters. In most situations, their innocent, unsophisticated minds, simply cannot understand the difference between wrong and right until they develop into more sophisticated beings. Ignorant people avoid thinking about anything which does not concern them personally. These people apparently have the ability to see, but because of their personality, are unable to. Until they start caring, they will not be able to see things which demand care, because they are not yet ready. Many adolescents and unsuccessful people would fall into this category. And why I stereotype many unsuccessful people is due to the fact that they are ignorant to education and in time, fail to succeed in life. Education is the knowledge of life, and if avoided, results in failure at it. If again, you mention war to an ignorant being, he or she will dismiss the subject before it could reach the brain’s thinking process. These personalities could never go below the surface of the topic. Stubbornness is similar to ignorance, but not quite the same. The stubborn will not hesitate to dive into the ocean, but will never reach the bottom so they can examine it in depth. These people will hear a topic; they will think about the topic; but before looking at it from another viewpoint, their stubbornness will compel them to form a prejudice opinion. These would be the people who, when spoken to of war, will take a stand on one side before examining the other. For example, if America is warring with Iraq, many stubborn Americans will support their leader no matter how immoral his actions may be. Same would imply to the stubborn Iraqis, who will deny the fact that their leader was corrupt without visualizing him from his victims’ perspective. Because they are the citizens of their country, they will overlook its faults and never question their government’s actions, thus, diving into the situation, but only going half way down, because that is what they are prepar ed to see, therefore, that is what they see. The realists see everything and accept it as it is. They have the power to make unbiased decisions and opinions. These are the people who will stand up for what they believe in. They are logical and open-minded. A realist would dive into the ocean, go to the bottom, take time to look at everything in depth, then, and only then, will form an opinion backed by much reasoning. Realists can see everything. Their minds have no road blocks blocking information from entering and processing through their brains. A realist will look at Emerson’s quote and completely comprehend its meaning. To what depth you understand this essay will determine how ready your mind is to accept the facts stated in it. Literally, you will see everything on these pages. However, mentally, your mind will comprehend only the details herein, for which it is prepared to accept. If you have read this far, you certainly are not ignorant; you have already gone below the surface of the quote. If you have understood and accepted everything, congratulations, you are in fact, a realist! If not, time may be the remedy to your innocence or stubbornness.

Defining And Analysing Green Chemistry Environmental Sciences Essay

Our environment, which is endowed by nature, needs to be protected from of all time increasing chemical pollution associated with modern-day life styles and emerging engineerings. India, 2nd largest manufacturer of pesticides and ranked 12th in pharmaceutical production, is fast rising as top 5 participant in selected petrochemicals. The challenge for the establishment and industries is to come together and prosecute development in the field of greenish chemical science by cut downing or extinguishing the usage and coevals of risky substances. We have organized a national and an international symposium for advancing Green Chemistry in India, which has provided the platform for interaction of constructs among the taking scientist. Furthermore a refresher class of three hebdomads for college instructors on eco-friendly chemical science has besides been organized earlier to advance consciousness and facilitate instruction preparation and the pattern of green chemical science in academic establishments. The chief thought buttocks is to trip work towards green chemical science for which engagement of academic, industrial, governmental and non-governmental organic structures is needed jointly which will assist the designing and development of environment friendly chemical science patterns in India. ent enterprises. Introduction Green chemical science: – Green chemical science may be defined as the innovation, design, and application of chemical merchandise and procedure to cut down the eliminate the usage and coevals of risky substances. Therefore, green chemical science is a tool non merely for minimising the negative impact of those processs aimed at optimising efficiency, although clearly both impact minimisation and procedure optimisation are legitimate and complementary aims of the topic. Green chemical science, nevertheless, besides recognizes that there are important effects to the usage of risky substances, runing from regulative, managing and conveyance, and liability issues, to call a few. To restrict the definition to cover with waste merely, would be to turn to lone portion of the job. Green chemical science is applicable to all facets of the merchandise life rhythm as well.A Finally, the definition of green chemical science includes the term â€Å" risky † . It is of import to observe that green chemical science is a manner of covering with hazard decrease and pollution bar by turn toing the intrinsic jeopardies of the substances instead than those fortunes and conditions of their usage that might increase their hazard. Green chemical science is non complicated although it is frequently elegant. Green chemical science applies to any type of chemical science such as organic chemical science, inorganic chemical science, bio chemical science, analytical chemical science and even physical chemical science. Green chemical science is chiefly for industrial country. The chief end of green chemical science is to minimising the jeopardy and maximising the efficiency of any chemical pick. Green chemical science can be applies on organic chemical science, physical chemical science, inorganic chemical science, analytical chemical science and biochemistry. Chiefly green chemical science focuses on industrial applications. The chief end of green chemical science is to minimising the jeopardy and maximising the efficiency of any chemical pick. Principles of green chemical science: – There are 12 rules of green chemical science. It is better to forestall waste than to handle or clean up waste after it is formed. Man-made methods should be designed to maximise the incorporation of all stuffs used in the procedure into the concluding merchandise. Wherever operable, man-made methodological analysiss should be designed to utilize and bring forth substances that possess small or no toxicity to human wellness and the environment. Chemical merchandises should be designed to continue efficaciousness of map while cut downing toxicity. The usage of subsidiary substances ( dissolvers, separation agents, etc. ) should be made unneeded whenever possible and innocuous when used. Energy demands should be recognized for their environmental and economic impacts and should be minimized. Man-made methods should be conducted at ambient temperature and force per unit area. A natural stuff or feedstock should be renewable instead than consuming whenever technically and economically operable. Unnecessary denationalization ( barricading group, protection/ deprotection, impermanent alteration of physical/chemical procedures ) should be avoided whenever possible. Catalytic reagents ( every bit selective as possible ) are superior to stoichiometric reagents. Chemical merchandises should be designed so that at the terminal of their map they do non prevail in the environment and make interrupt down into innocuous debasement merchandises. Analytic methodological analysiss need to be farther developed to let for existent clip, in-process monitoring and control before the formation of risky substances. Substances and the signifier of a substance used in a chemical procedure should be chosen to minimise the potency for chemical accidents, including releases, detonations, and fires. The term Green Chemistry, coined by staff at the US EPA in the 1990s, helped to convey focal point to an increasing involvement in developing more environmentally friendly chemical procedures and merchandises. An rating of how green a chemical reaction or a chemical procedure is seems to be best done in footings of the 12 rules that have been advocated by Anastas and Warner. These dogmas deal with cardinal issues such as pollution bar, atom economization and toxicity decrease. The kernel of the 12 rules may be summarized as follows: Waste bar alternatively of waste clean-up, atom economic system as an of import concern, design of environmentally friendly man-made methodological analysiss, design of safer chemicals, redundancy of subsidiary substances, preservation of energy, usage of renewable feedstock, decrease of unneeded derivatization, catalytic reactions alternatively of stoichiometric 1s, adulteration of concluding merchandises after the terminal of their map, real-time analysis for pollution bar and schemes for chemical accident bar. Sustainable development- Sustainability in scientific discipline and engineering Begins when we start believing how to work out a job or how to turn scientific discipline into engineering. Chemistry, as the scientific discipline of affair and its transmutation, plays a cardinal function in this procedure and is the span between natural philosophies, stuff scientific disciplines and life scientific disciplines. Merely chemical procedures, which have reached – after careful optimisation – a maximal in efficiency, will take to more sustainable merchandises and production. Scientists and applied scientists, who invent, develop and optimise such procedures, hence play a cardinal function. Their consciousness, creativeness and looking in front is needed to convey reactions and chemical procedures to maximal efficiency. The term â€Å" Green Chemistry † has been coined for attempts towards this end. Atom economic system: – Atom economic system means maximising incorporation of stuff from the get downing stuffs or reagents into the concluding merchandises. It is basically pollution bar at molecular degree. For illustration, a chemist practising atom economic system would take to synthesis a needful merchandise by seting together basic edifice blocks, instead than by interrupting down a much larger get downing stuff and flinging most of it waste. Atom economic system is an of import development beyond the traditionally taught construct of percent output. Barry Trost, from Stanford University, published the construct of atom economic system in scientific discipline in 1991. In 1998 received the president green chemical science challenged award for his work. Atom economic system answers the basic inquiry, â€Å" how much of what you put into your pot terminal up in your merchandise † . Calculation of Atom Economy Chemical reactions in green chemistry- There are two types of reactions- Atom economic reactions. Atom un-economic reactions. In atom economic reactions there are another two type reactions Rearrangement reactions. Addition reactions. In atom un-economic reaction there are three type of reactions Substitution reaction. Elimination reaction. Witting reaction. Reducing toxicity- One of the underpinning rule of green chemical science is to plan chemical merchandise and procedure that usage and bring forth less risky stuffs. Here risky screen all facets, including toxicity, flammability, detonation potency, and environmental continuity. A jeopardy can be defined as state of affairs that may take to harm, whilst hazard is the chance that injury will happen. From the point of position injury being caused by exposure to the chemical. Hazard = Green analytical chemistry- The relationship between green chemical science and analytical chemical science can be treated in two ways. Analytic chemical science is a capable to command and warrant green chemical science. This is where analytical chemical science is an efficient tool for verification of the green consequence of a chemical merchandise or engineering. On the other manus, chemical analysis methods need dissolvers, reagents, and energy, and they generate waste. The rules of green chemical science, suggested by Anastas and Warner, are straight related to analytical chemical science every bit good, the most of import of them being bar of waste coevals ; safer dissolvers and aides ; design for energy efficiency ; and Safer chemical science to minimise the potency of chemical accidents. In this manner, analytical chemical science becomes an object of application of the rules of green Chemistry, and can be the mark of a green chemical science attack likewise to other countries of chemical science and chemical engineering. The term â€Å" green analytical chemical science † has been proposed by J. NamiesA?nik in that several facets of doing analytical chemical science greener were discussed. The development of instrumental methods to replace wet chemical science in sample readying and intervention is a general tendency in analytical chemical science. Here, the chief analytical consequence is related to an addition of analysis dependability, higher preciseness, and clip economy, which really positively combines with a significant decrease of waste. In most instances, the consequence of instrumental methods in analysis is a lessening in sample volume needed for analysis. Particular attempts to incorporate micro fluidics and processing in micro graduated table can well diminish the sample sum and attach toing coevals of waste. In some instances, there is a pick of direct techniques of analysis ( different laser-spectroscopic methods ) or solvent less procedures of analysis, which are green procedures. However, in most instances, the samples under survey are really complicated mixtures with interfering matrices non leting the usage of waste less method. The hunt for alternate dissolvers is an of import measure on the manner of utilizing greener methods. In This procedure, the chief mark should be non merely the replacing, but debut of an extra advantage from different belongingss of these dissolvers to better the selectivity, sensitiveness, and dependability of analysis, every bit good as cut down analysis clip. The development of instrumental methods in general leads to an efficient usage of energy, particularly when the method is extremely automated and uses a minimum sum of sample. The word division of several methods for sample intervention and separation of constituents or integrating of separation and complicated methods of sensing enables an efficient usage of energy. Additional energy economy is possible when a microwave intervention or even merely micro-cook warming is incorporated into the procedure. An supersonic irradiation may besides hold a strong consequence on several sample interventions. The development of photochemical methods is a extremely green manner in analytical chemical science every bit good. Most of the above-named processs besides result in safer chemical science. In many instances of sample readying and intervention, different chemical methods for derivatization and chemical alteration of samples are still used. The hunt for less toxic compounds and procedures with decreased waste coevals should be an purpose in the development of new methods. What can green chemical science make? Green chemical science is non a peculiar set of engineerings, but instead an accent on the designA of chemical merchandises and processes.A Sometimes, green chemical science takes topographic point at the molecular degree to cut down or extinguish the usage and coevals of risky substances. This attack offers environmentally good options to more risky chemicals and procedures, and therefore promotes pollution bar. Green chemical science can take to dramatic alterations in how we interact with chemicals on a day-to-day footing as in the instance of theA 2005 Nobel Prize in Chemistry for the development of the metathesis method in organic synthesis. â€Å" The word metathesis means ‘change-places ‘ . In metathesis reactions, dual bonds are broken and made between C atoms in ways that cause atom groups to alter topographic points. This happens with the aid of particular accelerator molecules. Metathesis can be compared to a dance in which the twosomes change spouses. Metathesis is used daily in the chemical industry, chiefly in the development of pharmaceuticals and of advanced plastic stuffs. Thankss to the Laureates ‘ parts, synthesis methods have been developed that are more efficient ( fewer reaction stairss, fewer resources required, less wastage ) , simpler to utilize ( stable in air, at normal temperatures and force per unit areas ) , and Environmentally friendlier ( non-injurious dissolvers, less risky waste merchandises ) . This represents a great measure frontward for ‘green chemical science ‘ , cut downing potentially risky waste through smarter production. Metathesis is an illustration of how of import basic scientific discipline has been applied for the benefit of adult male, society and the environment. † The chief inquiry is that Why Green Chemistry? Green chemical science is effectual in cut downing the impact of chemicals on human wellness and the environment. In add-on, many companies have found that it can be cheaper and even profitable to run into environmental ends. Net incomes derive from higher efficiency, less waste, better merchandise quality, and decreased liability. Many environmental Torahs and ordinances target risky chemicals, and following all these demands can be complicated. But green chemical science allows companies to follow with the jurisprudence in much simpler and cheaper ways. Finally, green chemical science is a cardinal science-based attack. Addressing the job of jeopardy at the molecular degree, it can be applied to all sorts of environmental issues. Since 1991, there have been many progresss in green chemical science, in both academic research and industrial execution. For illustration, Spinosad, an insect powder manufactured by fermenting a of course happening dirt being, was registered by the EPA as a reduced-risk insect powder in 1997. Spinosad does non leach, bioaccumulation, volatilise, or persist in the environment and in field trials left 70 to 90 per centum of good insects unharmed. It has a comparatively low toxicity to mammals and birds and is somewhat to reasonably toxic to aquatic beings, but is toxic to bees until it dries. In another progress, an industrial cleansing dissolver, ethyl lactate, made from cornflour and soybean oil was patented in 2000 and is competitively priced with petrochemical dissolvers. It biodegrades to carbon dioxide and H2O and has no known harmful effects for the environment, worlds, or wildlife. These progresss, nevertheless, represent an highly little fraction of the possible applications of green chemical science. Because the merchandises and processes that form the footing of the economic system and substructure are based on the design and use of chemicals and stuffs, the challenges confronting this field are tremendous. What is the function of chemist in green chemical science? Chemist can utilize his cognition of green chemical science and its benefits to warrant research into ‘cleaner and greener ‘ procedure. In most instances it is readily incontrovertible that green chemical science attack affecting decrease of waste, stuff and energy, will besides take to be decreases and that this in bend will hold a positive consequence on profitableness. In academia enterprises such as the technology and physical scientific disciplines research council ( EPSRC ) Clean Technology Programme and the authorities ‘s sustainable engineering enterprise have already encouraged professionals to come in this country. Although many of the engineerings or tools required to do chemical fabrication more sustainable are available, and so industry already doing important advancement, much more can be achieved. In order to travel frontward chemist demand to understand, and get the better of the barrier s, both existent and perceived, that exist to innovation in this country. In some instances a civilization alteration may be required before the possible fiscal benefits are to the full appreciated. Professional chemist besides have a major function in assisting to promote all interested parties, including industry, clients, force per unit area groups, authorities, educationist and research workers, to co-operate to guarantee a cleaner and more sustainable hereafter. Graph of published articles in journals- Examples of green chemistry- Lead-free solders and other products- Breakthroughs in the replacing of lead include usage of new soldering stuffs, options to take additives in pigment and the development of cleaner batteries. Bioplastics – Plastics made from workss, including maize, murphies or other agricultural merchandises, even agricultural waste, are an of import illustration of green chemical science. Merchandises already available are forks, knives and spoons made from potato amylum and biodegradable packaging made from maize. Fire immune materials-Plastics that do non necessitate the usage of fire retardents are a solution to the job of toxic fire retardents. A combination of polylactic acid and kenaf-two agriculturally products-has already been developed for this intent. Halogen-free fire retardants- For merchandises that still require the usage of fire retardents, green chemical science can assist place new, less toxic options. For illustration, silicone based stuffs can be used. Biopesticides besides the good illustration of green chemistry- Biopesticides offer powerful tools to make a new coevals of sustainable agribusiness merchandises. They are the most likely beginning for options to some of the most debatable chemical pesticides presently in usage. Biopesticides besides offer solutions to concerns such as pest opposition to traditional chemical pesticides, public concern about side effects of pesticides on the environing environment and finally, on human wellness. Examples of Investigatory Projects in Green Chemistry- Effectss of Detergent Phosphates on Plant GrowthBecause phosphates from family detergents seep into groundwater, a fake consequence can be investigated utilizing a immature pea works and a solution of 90-percent H2O to 10-percentA laundry detergentA solution. Use two containers of pool H2O to imitate phosphate ‘s catalytic consequence on algae growing by adding detersive solution to one container intermittently and utilizing an unchanged container as a control. Record all observations qualitatively and quantitatively.Consequence of Pollution on BiodiversityUse several terrariums made from local beings, dirts and H2O to look into how pollution affects the sum of biodiversity in an ecosystem. Pollute terrariums by spraying diluted sulfuric acid into a terrarium to stand for acerb rain. Pollute another terrarium by carefully firing a birthday candle indoors daily to stand for smog. Leave one terrarium unpolluted to utilize as a control group. Record all observations qualitatively and quantitatively.Storm Water Geologically Filtered After a difficult rain, H2O hastes into local waterways transporting many pollutants. Contaminated H2O can be created by blending H2O with little objects and dark colored soil to stand for different types of pollution. Invent a system of filtration utilizing different sized grains of dirt to make state of affairss of altered porousnesss and permeableness. Record all effects on pollution filtration qualitatively and quantitatively. Future products- PVC free cablesA -will cut down the usage of both PVC and of lead, which is used as a stabilizer in PVC cabling. The Toxic Use Reduction Institute has been working on this new solder. New nonleaded soldersA with lower heat demands are being developed. Our new merchandise development will concentrate on: aˆ? Polymeric solutions, large molecules aˆ? Reactive merchandises that become edge to the concluding polymer aˆ? Non-toxic little molecules aˆ? Mineral merchandises aˆ? Minimizing the life rhythm of merchandises that remain in the environmentA aˆ? Improving recyclability aˆ? Implementing steps throughout the supply concatenation to minimise emanations of relentless compounds aˆ? Engaging distributers, clients and rivals in plans, such as VECAP, to extinguish all harmful merchandises from the environment aˆ? Continuing to rede consumers of the of import of sustainable merchandises. Some basic ways in which we go about green merchandise development – Choice of reagents with lowest toxicity Choice of accelerators that would supply highest reaction output, therefore minimising waste Choosing the right signifier of energy to maximise reaction efficiency Precise computations to foretell with merely two to three experiments how the reaction can be optimized, every bit good as the two or three preferred dissolvers for that reaction Designation of possible jeopardies before carry oning the reaction. Specific parametric quantities such as heat of the reaction are studied. Valuess of Green Chemistry in Innovation, Application and Technology: Indian Scenario- Green chemical science focuses on the decrease, recycling, and/or riddance of the usage of toxic and risky chemicals in production procedures by happening originative, alternate paths for doing the coveted merchandises that minimize the impact on the environment. Green chemical science is a more eco-friendly green option to conventional chemical science patterns. The green chemical science motion is portion of a larger motion finally taking to a green economy- viz. sustainable development, sustainable concern and sustainable life patterns. Green chemical science can lend to accomplishing sustainability in three cardinal countries. First, renewable energy engineerings will be the cardinal pillar of a sustainable high-technology civilisation. Second, the reagents used by the chemical industry. Third, fouling engineerings must be replaced by benign options. The purpose of the article is to introduce the academicians, research workers, scientists and applied scientists with values and po sitive impact of green Chemistry in invention, application and Technology. The green chemical science moving ridge has reached our state excessively. We need to work for its improvement by promoting the patterns of green chemical science. Collaborations between industrial and academic spouses are of import to hasten the transportation of important green merchandises to the market place. For such coactions to be successful, persons in these two otherwise motivated civilizations need to work together to progress green scientific discipline. Governments could doubtless ease formation of more effectual industrial/academic partnerships. Under an understanding with the Green Chemical Institute, University of Delhi has been accepted as an international chapter. The Indian chapter will advance green chemical science through instruction, information aggregation and airing, research and international coaction via conferences, workshops, meeting and symposia.A In India, although there is turning awareness about the sick effects of pollution, publicity of continual debut of environmentally friendly merchandises a methodological analysiss in the chemical industry needs to be furthered. Use of nonconventional engineerings is extremely popular in India. First in this list is the use of microwaves. Further, the microwave chemists are turning their attending toward microwave-assisted dry-media reactions in order to minimise solvent use, an added advantage to already established microwave chemical science. In add-on to microwave-assisted reactions, supersonic and photochemical reactions are besides used as nonconventional reaction engineering. Analytic chemical science has been at the centre of the green chemical science motion. Progresss in analytical chemical science are cardinal to environmental protection. In India, the focal point for analytical chemical science is chiefly on extraction engineerings such as solid stage, ultrasound and microw ave, supercritical fluid extraction, and automated soxhlet extraction. Monitoring and analysis of heavy metals and pesticides is really of import for an agro economy-based state like India and main governmental institutes like the Indian Agricultural Research Institute ( IARI ) and the Defense Research and Development Organization ( DRDO ) are working extensively in this field. Further removing of these elements from industrial and agrochemical use is of premier importance for these. Some recent developments and illustrations in green chemistry- Chemists from all over the universe are utilizing their originative and advanced accomplishments to develop new procedures, man-made methods, analytical tools, reaction conditions, accelerators, etc. under the new green chemical science screen. Some of these are. A uninterrupted procedure and setup converts waste biomass into industrial chemicals, fuels and carnal provender. Another procedure converts waste biomass such as municipal solid waste, sewerage sludge, plastic, tyres and agricultural residues to utile merchandises, including H, ethyl alcohol and acetic acid. A method for mass bring forthing taxol by semi uninterrupted civilization of Taxus genus works. A agitation method for the production of carboxylic acids. A method of partly oxidising intoxicant such as methyl alcohol to quintessences, aldehydes, esters or acids, by utilizing a supercritical fluid Mobile. A procedure for bring forthing a fluoropolymer by utilizing supercritical C dioxide. A cost-efficient method of bring forthing ethyl lactate, a non-toxic dissolver derived from maize. A scope of ‘organic dissolvers ‘ that are worker friendly and environmentally sound. A new environmentally friendly engineering in assorted metals recovery from exhausted acid wastes has been used to retrieve Zn and ferric chloride from pickle spirits. The demand for non-ionic wetting agents is turning and a new illustration of this is alkyl glycoside, which is made from carbohydrate. This merchandise can be used as a replacing for alkyl aryl sulphonate anionic wetting agents in shampoos. Sodium silicate can be used as a more environmentally benign replacing for phosphorus-containing additives in rinsing pulverization. Three coconut oil soap bases for liquid cleaning applications have been developed. One of these merchandises has really light colour and low olfactory property, doing it suited for presenting dyes and aromas. Feedstock recyclingA of plastic wastes into valuable chemicals utile as fuels or natural stuffs. Developing States and Green Chemistry- In developing states, the debut of green chemical science is still in a phase of babyhood, despite the important demand and the important function green chemical science can play. Many of the patterns in developing states are still far from the constructs of safety, pollution bar and design of energy efficiency. Environmental pollution and waste coevals are some of the hurting jobs many developing states are enduring from. Many of the grounds behind these jobs lie in policies and schemes adopted that are based on end-of pipe intervention, instead than pollution bar at beginning or implementing life rhythm believing in managing waste jobs. Most often, income coevals activities are dependent on an efficient usage of energy and other resources such as H2O, which may present some serious jobs to future coevalss. The United Nations coverage on the millenary development ends at a state degree indicated a high degree of energy ingestion and limited energy resources in most of the developing states. The study strongly recommends the imperative demand to ration the usage of energy resources in these states and to implement energy preservation policies. The same tendency of troubles developing states face has been illustrated in the series of state studies produced by the rural development at the H2O and environment section of the World Bank. Sustainable chemical science could play a polar function in salving many of the ailing conditions that many of the development states are subjected to. The usage of solar energy, debut of sustainable agriculture, recycling, and the execution of life rhythm thought and life rhythm analysis as a direction tool for some of the chronic issues such as municipal waste direction, are some few illustrations of how green chemical science can profit developing communities. Green chemical science can besides hold a really strong impact on H2O sufficiency issues in that portion of the development universe where H2O resources is the most critical issue. It is through the execution of cleaner production and usage of safe and biodegradable chemicals that a immense volume of effluent could be reused to slake the emerging, critical demand of H2O in many of these states. Government Initiatives- Government can make a batch of good for the cause of green chemical science by increasing public consciousness and by conveying and implementing rigorous environmental statute laws. One of the recent and controversial illustrations of authorities enterprise is the transition of Diesel vehicles to tight natural gas ( CNG ) in order to cut down pollution. Relocation of industries into industrial countries off from residential Parks is another bold measure taken by the Delhi authorities. Further, the authorities is besides concentrating on new undertakings such as fuel pellets from municipal waste, aspirated H-cylinder engines for light commercial vehicles ( LCVs ) , run intoing India 2000 emanation norms, battery-powered autos for pollution-free drive, H energy and energy towers for new environment-friendly fuel, development of traditional herbal drugs as adapt gens a immunomodulators. The authorities should besides increase support to promote research in green chemical science. By pre senting green chemical science instruction at all degrees, the authorities can construct a solid foundation toward green chemical science in India.

Coca-Cola Is Everything: SCM, CRM, Collaboration, You Name It

If we told you that Coca-Cola has operating units in 50 countries around the world, you probably wouldn’t be surprised. If we told you that Coca-Cola had been in business for almost 125 years, you probably wouldn’t be surprised. So, you tell us†¦ how many different beverages does Coca-Cola produce? 100? 500? 2,000? Are you surprised yet? Worldwide, Coca-Cola produces an amazing 2,800 different beverages.When an organization is that big, has that sort of worldwide presence, and boasts what is perhaps the most well-known brand ever, you can bet that a multitude of IT systems are constantly churning in the background, not only keeping the organization running, but also keeping in running ahead of the competition. To support internal collaboration efforts, Coke created something it calls its Common Innovation Framework, a Web-based system that combines project management capabilities with business intelligence.Using the Innovation Framework, anyone from any of the oper ating units worldwide can search for, find, and apply concepts, strategies, development successes, and marketing approaches that have been used elsewhere in the organization. For example, when introducing Georgia teas in Australia, the Coke people Down Under can research what marketing strategies worked well in related countries such as New Zealand.As Jean-Michel Ares, Coke CIO, explains it, â€Å"Once you’ve aggregated that pipeline of innovation, the object is to assess and prioritize the best allocation of resources in the organization. † Beyond internal employees, Coke is reaching out with new and innovative IT steps. Recently, it rolled out a new line of software services based on hundreds of business processes to its extended family of bottlers. These software services each perform a specific common business function and run within SAP's ERP software and are delivered by Coke's IBM-hosted data centers.The goal is to create a standardized business and technology p latform across all Coke bottlers, most of which are independent franchises. (There are some partly owned by Coke. ) If Coke and all its bottlers are speaking the same language, so to speak, and using the same technology, then supply chain management applications will be more efficiently streamlined. Standardization in this case equates to saving money by reducing expenses associated with supply chain activities.And even beyond its extended family of bottlers, Coke is using technology to create loyalty and engage more with its customers. Its award-winning Web site, My Coke Rewards at www. mycokerewards. com, is the second most popular consumer packaged-goods site, behind only www. kraftfoods. com. My Coke Rewards attracts some 300,000 visitors per day. Offering everything from magazine subscriptions to electronics as prices (just look under the cap), My Coke Rewards has reconnected Coke with its loyal drinkers.The site has teamed up with pop culture crazes such as American Idol, socc er, and auto racing to bring even more customers into the fold. You can even find Coke-labeled songs through iTunes. 1) Describe the various IT-enabled initiatives discussed in this case study. 2) Describe two different forms of e-collaboration in this case study. For each, articulate the benefits to Coke. 3) What sort of business intelligence could Coke gather from its My Coke Rewards Web site? How could it use this information for customer relationship management activities? Coca-Cola Is Everything: SCM, CRM, Collaboration, You Name It If we told you that Coca-Cola has operating units in 50 countries around the world, you probably wouldn’t be surprised. If we told you that Coca-Cola had been in business for almost 125 years, you probably wouldn’t be surprised. So, you tell us†¦ how many different beverages does Coca-Cola produce? 100? 500? 2,000? Are you surprised yet? Worldwide, Coca-Cola produces an amazing 2,800 different beverages.When an organization is that big, has that sort of worldwide presence, and boasts what is perhaps the most well-known brand ever, you can bet that a multitude of IT systems are constantly churning in the background, not only keeping the organization running, but also keeping in running ahead of the competition.To support internal collaboration efforts, Coke created something it calls its Common Innovation Framework, a Web-based system that combines project management capabilities with business intelligence. Using the Innovation Framework, anyone from any of the oper ating units worldwide can search for, find, and apply concepts, strategies, development successes, and marketing approaches that have been used elsewhere in the organization.For example, when introducing Georgia teas in Australia, the Coke people Down Under can research what marketing strategies worked well in related countries such as New Zealand. As Jean-Michel Ares, Coke CIO, explains it, â€Å"Once you’ve aggregated that pipeline of innovation, the object is to assess and prioritize the best allocation of resources in the organization.†Beyond internal employees, Coke is reaching out with new and innovative IT steps. Recently, it rolled out a new line of software services based on hundreds of business processes to its extended family of bottlers. These software services each perform a specific common business function and run within SAP's ERP software and are delivered by Coke's IBM-hosted data centers.The goal is to create a standardized business and technology pla tform across all Coke bottlers, most of which are independent franchises. (There are some partly owned by Coke.) If Coke and all its bottlers are  speaking the same language, so to speak, and using the same technology, then supply chain management applications will be more efficiently streamlined. Standardization in this case equates to saving money by reducing expenses associated with supply chain activities.And even beyond its extended family of bottlers, Coke is using technology to create loyalty and engage more with its customers. Its award-winning Web site, My Coke Rewards at www.mycokerewards.com, is the second most popular consumer packaged-goods site, behind only www.kraftfoods.com.My Coke Rewards attracts some 300,000 visitors per day. Offering everything from magazine subscriptions to electronics as prices (just look under the cap), My Coke Rewards has reconnected Coke with its loyal drinkers. The site has teamed up with pop culture crazes such as American Idol, soccer, and auto racing to bring even more customers into the fold. You can even find Coke-labeled songs through iTunes.1) Describe the various IT-enabled initiatives discussed in this case study. 2) Describe two different forms of e-collaboration in this case study. For each, articulate the benefits to Coke. 3) What sort of business intelligence could Coke gather from its My Coke Rewards Web site? How could it use this information for customer relationship management activities?

Education Research Paper Example | Topics and Well Written Essays - 1000 words - 1

Education - Research Paper Example The subject school that is being documented tends to display a similar trend. The school in focus is an elementary school so the ages of the student population tend to be under 12 years of age. The Hispanic background of most student’s means that they come from families where Spanish is spoken and understood. This often occurs at the expense of learning English and a significant amount of students in class tend not to speak any English at all. Yet another significant amount of students in class tend to speak some English though there is a large need to improve the spoken English skills. Only a minor amount of students can fully communicate in and comprehend English. On average the typical Grade 4 student has trouble coping with speaking a few words of English. In this situation, expecting these children to write words and sentences in English is unrealistic because they can hardly comprehend English. Most children can however follow cue and produce some sensible words while on ly a small amount of children can produce understandable sentences. In terms of behavior, a large majority of children are inclined to create disturbance in the classroom. The imposition of order in the classroom is a separate task in itself. However, it has been felt that if these children’s behaviors are reinforced with more positive values, a significant difference could be created. This onus would fall to the school as these children hail from a relatively low socio-economic status. In most of the children’s families, either both parents are working or the mother has too many children to take care of. This indicates that the children are not given a lot of time by parents for their grooming especially as per behavior and education. In addition the language barrier that exists between the teachers and the students means that not all instructions are being carried forward as intended. Rework and repetition of the same tasks in class is common since most children fail to comprehend instructions the first time. Since most children are essentially English language learners, so there is dire need to look into the lingual skills of these children before any other form of learning is introduced. The lack of proper communication between teachers and students is a major facet of the school environment. The interaction between teachers and students is limited by the fact that both parties are unable to understand each other completely unless the teacher has a Hispanic background as well. A few Caucasian students are present in class as well but interaction with them alone cannot be taken as a guarantee for other children to learn English. In terms of teaching, the language barrier poses problems on different fronts. For one thing, the instructions passed onto children are not clear the first time and there is often the need to repeat instructions. This tends to slow down the overall pace of work significantly. Furthermore, this issue creates an evaluati on based problem as well. The limited interaction available with the students makes it hard to evaluate if a student has learning disabilities or if the student is being bogged down in translation. Language also plays a defining role in how the community tends to view itself. It is typical to see Hispanic children sitting together in class, socializing together and forming cults. This exclusion tends to take place because these children do not have the necessary language skills to

Treatment plan for Paranoid- type Schizophrenia Case Study

Treatment plan for Paranoid- type Schizophrenia - Case Study Example The paper tells that the goals of treatment for paranoid- type schizophrenia emphasize the promotion of safety of the client and other involved people, ensuring proper nutrition, enhancing therapeutic relationship between the client and the therapist, and prevention of complications associated with medications and inappropriate social behavior. Recent developments in mental health research stress out the importance of treating the client as an individual case rather than as part of the general afflicted population. In considering the treatment plan in this particular scenario, the psychiatric diagnosis may be complicated with the consideration of the client’s current substance abuse. Since substance abuse appears to be co- morbid for this client’s case, prescription of medications should consider all aspects that could hinder the client’s adherence to the regimen. When the climax of the appearance of signs and symptoms starts to stabilize, assistance may be neede d to facilitate the client’s reintegration to the society. In this phase of treatment, follow- up care should facilitate the participation of the client’s family to identify early signs and symptoms of relapse. Since the client is potentially harmful to herself and others, safety should be regarded as the highest priority. Based on the initial assessment performed in the clinic, the client looked paranoid and seemed to be threatened by her new environment. At this moment, it is important that the therapist approach the client in a non threatening manner. Furthermore, the therapist should also be careful not to sound authoritarian as it may increase the client’s stress level. Space is a vital component to be considered especially in the early phase of interventions (Videbect, 2007). With the status of the client, preemptive measures should include securing a physician’s order for administering medication to control potentially injurious behaviors. Moreover , the therapist should continue to observe signs of escalating aggression such as pacing, kicking, and yelling. A quiet and less stimulating environment may be helpful in calming the client. However, seclusion and other forms of restraints may also be needed in heightened situations. Evaluation of this intervention is concurrent and does not end until the client demonstrates full recovery. The therapist should be careful in deciding whether the client has fully achieved a mental status at a functional level. Research has suggested that the client’s report of feeling a sense of well- being is never an assurance that the risk for self- injury has subsided (Videbect, 2007). Management of medications and side effects Another important aspect regarding the establishment and maintenance of safety for the client is the careful monitoring of the adverse effects of medications (Valenstein et al., 2011). Potent psychotropic drugs may affect the organ function, especially the liver and kidneys, of clients on prolonged therapy. BUN and liver enzymes monitoring should be part of the treatment regimen to ensure that the client maintains a safe level of the medication. Other minor side effects like frequent urination, constipation, dry mouth, and photosensitivity may affect the client’s adherence to prescribed therapy. Most patients initiating antipsychotic medications tend to terminate the regimen within the first few months of treatment (Olfson et al., 2007). Studies have shown that failure to follow the prescribed medications for mental health conditions is the most common cause of relapse of psychotic symptoms and subsequent hospital readmission (Videbect, 2007). With proper adherence to the prescribed therapy, the client is expected to attain a functional recovery and lead a normal life. Actually, the client’s adherence to the prescribed regimen may be facilitated by the therapist in various ways.

The prograssive way for Halifax Essay Example | Topics and Well Written Essays - 1500 words

The prograssive way for Halifax - Essay Example This strategy options are the most promising one, present day situation in veterinary market is marked by two factor - specification, which is to do with the 'design quality' of service, and conformity, which is to do with the 'process' quality which is achieved are of particular importance to customers. On the other hand, Halifax can open its branchers in other city areas. This strategy will help to attract new clients providing veterinaty services near their residence. This strategy will help the clinic to create a strong brand image and increase the number of loyal customers. Service concepts of Halifax should include improvement of communication, and the environment composed of all the individual services. Client retention is important for many businesses because customers create demand in an industry. On the one hand, it helps the company to standardize services and, on the otehr hand, it secures the business from decrease in sales. Client retention is important because it helps to know customers "one by one", and it allows the firm to meet particular needs of the clients and find specific ways to solve their current problems. Also, client retention makes it possible to develop a basic long-term goal and objectives of an enterprise, and adopt courses of action and allocate resources necessary for carrying out these goals. Customer reteention will help to generate profit (McDonald, Christopher, 2003). Customers loyalty can be achieved thro... That is why maximizing each employee's potential as an individual and as a team member will be a key to maximizing the profitability of each hotel. To ensure customer satisfaction the veterinary clinic should implement and develop new strategy based on Web services. It is not a unique and a new form of service, but, unfortunately, this type of service is seldomly used by veterinary services. The idea of the web-enabling veterinary services is to provide the clinic with the tools they need to compete more e effectively and to grow their businesses successfully. To build a loyal group of clients, Halifax should consider time as the important factor of delivering service. Consider first the fee of services, a customer takes into account the delay or wait. This delay or wait will normally be evident as the period of time between placing an order and receiving the service. This is clearly an important dimension of customer service, because veterinary service is depended upon providing services at the exact time Another factors helped to retain a loyal group of clients include location of the clinic (and its subsidiaries), the cost reductions, high service quality and staff communication skills, free of charge web services and call centers. Ultimately they are the two factors which determine the quality levels provided by hotel industry to its customers. These two factors however are themselves determined by other factors. Service concepts are based on understanding the unique environment in which hotels operate. 4. What market segments exist in the market for veterinary services for household pets Market segmentation is the process identifying specific segments of clients with similar demands who exhibit similar responses to a firm's marketing mix. Within

Successful Approach to Development of Korea and Japan Term Paper

Successful Approach to Development of Korea and Japan - Term Paper Example The paper will generally concentrate on how the two countries; Japan and Korea are similar in their development and how they differ too. Korea has experienced late industrialization as compared to Japan. This is so because it was colonized by Japan from 1910 to 1945. The economic development was definitely influenced by Japan as they left them with some knowledge on how to carry out specific economic development methods. Many scholars and policy makers have seen the need to study Korea and Japan but their main focus is on the economic side only. This is to find out how the two giant economies have managed to grow rapidly over the years. The colonial rule by the Japanese was a great influence on the labor structure of Korea despite all other economic factors. Japan passed on to Korea skilled labor. The importance of skilled labor in uplifting the economic status of a country comes in when there is proper utilization of raw materials thus increase in the rate of production. This simply means that there will be no wastage of raw materials as the human resources know how to carry out specific activities while using the r aw materials. More so, because of specialization and perfect knowledge of a particular activity, an individual increases his or her number of goods produced. This meets the demand of the specific good or service by the general public. Moreover, there is always an addition for exporting (Alice, chapter 1 and 13). In addition, the Onada Cement plant of Japan had put up five branches in Korea and ten in Japan. The study of the workers in this palnt revealed that they were very skilled and this led to the province of South Pyongyang being one of the richest in Korea. Though Koreans were experiencing oppression by the Japanese due to colonization, they did gain modernity as Japan introduced them to new industrial methods. Japan had found cheap labor in Korea while they were colonizing

Paper reflection Essay Example | Topics and Well Written Essays - 500 words

Paper reflection - Essay Example The head of our tour group was called Paul Franklin. Paul Franklin was a good leader, and he was very eager and keen to satisfy our various needs. For instance, if one of us was interested in asking or seeking a clarification of a particular question, Paul Franklin will ensure that the nurse in charge of our tour answers the particular question. For instance, most of us had questions concerning the technologies and equipments found at the BMET workshop. One of the most pressing questions that we managed to ask is how the hospital is using new biomedical technologies for purposes of surgery. The official in charge of the hospital of BMET workshop was reluctant to tell us, this is because he did not have a ready answer at them. But Paul Franklin pressed him up, until the official gave an answer, even though it was not convincing enough. Each and every one of us was satisfied by the leadership and services of Paul Franklin. The members of this department had uniforms, and this was for purposes of distinguishing them from members of other departments. The color of their uniforms was a blue polo shirt, with bage pants. In my own opinion, the color and the design of their uniform were attractive. The blue color matched with the purposes of the workshop. This is because they were not dealing with patients, but machines that help in the provision of medical services. As such, the white color which is normally associated with doctors and nurses was not appropriate. The BMET workshop is at the basement of the hospital, and it occupies a large space area, that makes it possible to safely store the machines that are used for providing medical and research services. The employers of the department and junior members of this department had a very cordial working relationship. Their relationship is based on trust, understanding, and collaboration. This makes the employees to be motivated, and hence efficient in the manner in which they conduct their

Statistical models and probabilities Essay Example | Topics and Well Written Essays - 500 words

Statistical models and probabilities - Essay Example For every project, a schedule is prepared prior to the commencement of the execution of the work. In order for the schedule to be rational, it is imperative that the time taken by similar activities in the past is reviewed. The activities are assigned durations based on that. However, owing to the emphasis on creativity and innovation in the present age, civil engineers are trying new ways and methods of executing the projects, so past record of duration of a certain activity may not always be there. PERT is a technique of assessing the duration of an activity that has never been executed in the past. Like all other areas, civil engineering has also evolved through research. The conventional techniques for the quantitative and/or qualitative analysis of the data make use of statistical models and probabilities. The data is checked for normality through the measures of kurtosis and skewness. If the data passes the normality test, then parametric tests are applied to evaluate the data further. If the data does not pass the normality test, then nonparametric tests are applied for the further evaluation of the data. Risk management is a very important area of civil engineering. Civil engineers identify the risks at every stage of project starting from the project feasibility studies to the completion and handing over stage. Risk is any uncertain even that has a certain probability of occurrence and an impact. Assessment of risk at the right time not only allows the civil engineers to escape the threat posed by that risk, but also change that into an opportunity. Numerous techniques are employed for the risk assessment including the Monte Carlo simulation. Height of a bridge in a certain area is selected on the basis of the maximum water level seen in the history of floods and precipitation in that area. Different levels of water are assigned different probabilities depending upon the frequency of their

Windows Upgrade Report Essay Example | Topics and Well Written Essays - 500 words

Windows Upgrade Report - Essay Example XP is termed a real operating system capable of working on a separated mode giving maximum benefits in terms of server features for home and office use. Windows 7 came to live in 2009 as a replacement for Window XP. The Edition was designed for business, home and desktop use. The graphic features improved those of XP and implored the 3D. The â€Å"super bar† improved the architecture of the task bar with better coding scheme for instant access. In addition to Windows Media player, the new revolutionary Windows Movie Maker and Windows Photo Gallery updated the media segment (Er. Vivek Sharma, 2013). Windows 7 is available in many versions and present different features. Windows 7 is available in Starter, Premium, Enterprise, Professional and Ultimate. A user has a choice of these versions according to their needs. The system adopted higher requirement specifications than those of XP. Windows 7 is characterized by 64-bit and 32-bit architecture with 64-bit 1 GHz processor. The minimum RAM size mandatory is 2GB with a lowest amount of 20 GB hard disc. The 32-bit architecture has a RAM requisite of 1GB. This is the disadvantage with Windows 7 if the current hardware does not suite the requirements. Another issue is that Windows XP is not easily upgraded to Windows 7. Window 7 Enterprise has a number of features that minimizes cost for the business user. Direct Access is one such feature. Like the Direct Access, Branch cache is another application in Windows 7 that can be utilized together Windows server 2008 to improve the speed of extracting data from remote locations by caching the information in the intranet or the internet the first time it is requested. Other advancements include VDI, App locker, Federated search and Language Pack (Abraham Silberschatz, 2013). Windows 8 was first released for manufacturing on August 2012 and is an extension of the 6.2 version of the Windows NT Kernel. The new

Economics term paper Example | Topics and Well Written Essays - 2500 words

Economics - Term Paper Example 44 Allied nations from 1 July to 22 July 1944 to sign agreements for the establishment of International Bank for Reconstruction (IBRD, the World Bank), the International Trade Organization (ITO), and the International Monetary Fund (IMF). A system of exchange rate management was deployed, which was working till 1970. Currency conversion was mandatory by the member countries of the agreement, which became functional only in 1959, culminating in the setting of IMF and IBRD. As per the agreement, the member nations needed to consult one anther to reach a unilateral decision on global monetary developments, impacting the economies of all nations. The purpose behind the creation of IBRD was to take quick action for post-war reconstruction, to reach political stability, and promote peace through making of programs for reconstruction and development . Thus, the major industrial nations of the world came closer by framing rules for introducing a system of monetary functions of businesses among the allied powers of the World War II. By 1945, the IBRD an associate of World Bank Group currently and IMF started functioning after the ratification of the agreement by a good number of member countries. As per the agreement, in each member country’s monetary policy it was mandatory to maintain the exchange rate of its currency around a fixed value with the flexibility of 1 percent up or down against gold. It was essential to clear the imbalances in payments by the IMF. The system couldn’t work beyond 1971 due to increasing financial glitches and one-sided termination of conversion of dollar into gold by the United States. This action of the United States created furors in the international economy, and a new situation surfaced making the dollar â€Å"reserve currency† for the member nations that signed the agreement . The worldwide depression of

The Worn Path analysis Essay Example for Free

The Worn Path analysis Essay In the story â€Å"A Worn Path†, there is a repetitive comparison between the main character and a mythological creature. The author Eudora Welty chooses Phoenix Jackson to symbolize through color, her appearance, behavior and overall journey a Phoenix bird. The author gives description to focus on Phoenix Jackson’s age. She says that â€Å"her eyes were blue with age†, are hints of extreme age. Another description of her the author says â€Å"her skin had a pattern all of its own branching wrinkles. † This implies that an old tree has many branches as the old woman’s skin has many wrinkles. Later in the story when she encounters the hunter he asks of her age. She replies â€Å"there is no telling mister†, which tells you that phoenix is unaware of her age now that she has become so old like the phoenix bird. The phoenix has a life span of 500-1000 years before it reincarnates making it eternal. The color descriptions that are given to Phoenix Jackson are those of an actual Phoenix. Welty says that Phoenix has â€Å"a golden color that runs underneath and the two knobs of her cheeks were illuminated by a yellow burning†¦Ã¢â‚¬ . The phoenix bird is most recognizable by its colors, the fire bird. It’s beautiful colors of red orange and yellow give it its illuminated glow, the same colors given to phoenix Jackson. The animalistic characteristics of a bird are also given to Phoenix Jackson. She doesn’t see well, so in her journey through the woods she relies on her instinct to direct her on her path. She even closes her eyes when crossing a river. She is also protective of her grandson. Making a life threatening trek for his medicine because he cannot care for himself makes her his protector. A mother bird is very protective of her chicks, Phoenix even describes her grandson by saying â€Å"He wears a patch quilt and peep out holding his mouth wide open like a little bird.† There are numerous references that compare Phoenix to a bird. By her overall outlook on her journey she relies on instinct to carry her forward but she sees things differently than most. The view of a bird is a different one than any creature on land because they have a different perspective as does Phoenix Jackson.

Marketing Processes at Marks and Spencer

Marketing Processes at Marks and Spencer The organization Ill be concentrating on will be Tesco Store and Marks and Spencer. I chose to study organisation behaviour in Tesco and Marks Spencer due to having communication access. I would comfortably get information about these organizations. Tesco plc is an UK- based international grocery and general merchandising retail chain. It is the largest British retailer by both global sales and domestic market share, is the worlds third-largest grocery retailer, and is the fourth- largest retailer behind Wal-Mart of the United States, Carrefour of France, and the home depot of the United States. MS is an international company, which spreads through Europe, North America and Asia. MS is the largest and the leading variety store retailer in the UK. New brand and product development over the last ten years in fast-moving consumer goods sectors in the UK is that many of the most original and successful initiatives have been taken not by manufacturers but by retailers. The aim of this report is to examine organisation behaviour in concern with the understanding of those factors that influence peoples behaviour in the workplace. 2.1Different organisational structures Every organisation with more than one person needs a structure so that workers have clearly defined roles and are clear about the roles of others. An organisations structure is often presented as an organisational chart which will show how management is organised vertically with layers of hierarchy and horizontally by function, product or division. The chart will make clear who is responsible for what, who is responsible to who and who to go with problems and queries. There are three main types of organisational structure: tall hierarchical, flat and matrix hierarchical. Tall this type of structure will have more than 4 levels of structures and span of control is average of 6 people reporting. This causes a distraction in communicating because there are a few people in charge in this long stretching triangle. Bureaucracy has control in this type of organisation. Role culture is the way they work, good promotional aspects. Example of Tall Structure Flat this type of structure will have less than 4 levels and spam of control is about 25 people, usually higher. They have a good level of communication because they have only one or two people in charge that they can report to. Use power culture type of team work structure, have less promotional aspects. Wide and short triangle appears if drawn. Example of Flat Structure Matrix Matrix type of structure is when the work is spread out to other employees. They usually work in teams so their culture is task. Advantages are they can work more efficiently and focused Example of Matrix structure Project 1 Project 2 Project 3 Project 4 Project 5 Project 6 Project 7 Project 8 Employee 1 à ¢-  à ¢-  Employee 2 à ¢-  à ¢-  Employee 3 à ¢-  à ¢-  Employee 4 à ¢-  à ¢-  Network Autonomy (doctors, lawyers, dentists etc). Everyone has equal power so clash of powers and conflicts can happen. Organisational Culture Organisational culture is complex and multi-faceted. Culture is intangible and imprecise. It also changes over time. Culture encompasses standard patterns of behaviour and plays an important role in shaping our purchasing patterns. It stems from traditions, beliefs and values of the community in which people live. It is the complex of values, ideas, attitudes and other meaningful symbols that serves humans to communicate, interpret, and evaluate as members of society. There are four types of organisation culture role, power, and task and person culture. Role culture is known as a bureaucracy. In role culture job comes first so it creates a highly structured, stable company. Power culture is like the spiders web. One individual is in charge of the organisation in the centre surrounded by others involved. Task culture is job or project orientated. Individuals empowered with discretion and control over their work, is flexible and adaptable. Person culture is where the individual is the focus of the organisation. Examples are doctors , solicitors and dentists. Tesco structure Tesco structure seems to be a tall structure. There are six work levels within the organisation. This gives a clear structure for managing and controlling the organisation. Each level requires particular skills and behaviours. Work level 1 frontline jobs staff who works directly with customers doing various tasks in store, such as filling shelves with stock. They require the ability to work accurately and with enthusiasm and to interact well with others. Work level 2 lead a team of employees who deal directly with customers. They require the ability to manage resources, to set targets, to manage and motivate others. Work level 3 running and operating unit. They requires management skills, including: Planning, Target setting and Reporting Work level 4 supporting operating units and recommending strategic change. They require good knowledge of the business, the skills to analyze information and to make decisions, and the ability to lead others. Work level 5 responsible for the performance of Tesco as a whole. They require the ability to lead and direct others, and to make major decisions. Work level 6 creating the purpose, values and goals for Tesco plc. Responsibility for Tescos performance. They require a good overview of retailing, and the ability to build a vision for the future and lead the whole Organization. Marks and Spencer has a flat organisational structure. The business lost a number of layers of authority through delayering which means that employees throughout the business have more responsibility. This enables them to make quick decisions and justifying actions that have been taken. The organisational structure of MS means that most employees had to account for the decision made. Besides this, it is also necessary to make those decisions quickly since there is a lot that one single employee was expected to do. Training and development is therefore necessary to ensure that these employees. It should be noted that most of the roles taken up within MS are specialised. Therefore, employees need to be empowered by teaching them new skills in their new area or career. First of best practice requires that there should be lean organisation structures within the company in order to encourage team work. This is exactly what MS has done; it has included this as part of its strategy. Decision making is not as centralised as it used to be before thus necessitating the need for training and development. Summary Here as we can see Tesco has a tall structure and role culture is the way they work whereas MS has a flat structure and power culture team work. Both organisation structure and culture are different. Relationship between organisations structure and culture and the effects on business performance Organisations must have a formal structure in order for work to be carried out efficiently. It is necessary to divide work into groups or sections into a particular function to prevent duplication of efforts in order to maximise their limited resources. Because an organisation compromises of people there is also an informal organisation with different interlocking relationships, which gives rise to different behaviours, attitudes, individual perceptions and level of ability and aptitude. When people deliberately come together to fulfil a specific goal there are particular accepted ways to behave, speak and interact. This gives rise to organisational culture where it may be formed intentionally or unknowingly to its members by the behaviours of influential members, not necessarily personnel high up the hierarchy but by members who exercise different forms of power within the organisation. This relationship will now be individually examined in the different types of organisational stru cture associated culture and their influence on their employees resulting in their level of business performance. Business performance in a tall organisation structure can be affected by the length of time it takes for the flow of information through the levels of hierarchy making the organisation inflexible slow to adapt to the political, economic, socio-cultural, technological, environmental and legal factors. It has a narrow span of control causing tight control restricting freedom and empowerment which affects motivation. The level of motivation employees possesses affects their output affecting business performance. Employees do not have a clear idea of the big picture. Its highly bureaucratic nature influence role culture. In contrast a flat organisational structure possesses greater flexibility to the PESTLE factors due to its reduce levels of management, ensuring greater survival. The wider the span of control and greater levels of communication may encourage creativity, initiative and ability to make decisions giving the feeling of empowerment, resulting in motivated workers, which affects business performance. This is also dependent upon the individuals personalities and networking relationships within the organisation. If people refuse to work together or perceive what others say it could affect employee relations and output affecting business performance. The culture found in flat organisation structure is that of power culture. The relationship between culture and business performance depend on how strong culture firms learn from and react both their own experiences and changes in their environment. It also confirms behavioural consistency so that there is less room for debate between different groups about the organisation goals. Factors that influence individual behaviour at work The ability to learn from experience will affect individual at work, other factors that affect an individual behaviour at work including ability and aptitude, abilities are things that people can do, or are good at, and this is believed to be inherited. Aptitude is the capacity to learn and develop abilities or skill. Another factor is the individual attitude. Firstly individual to work that is their perspective on working, management, acquaintances and the organisation and the organisation and their attitude at work which is their stance or standpoint about politics, religion, education, and whether they choose to agree or disagree. Perception is the way an individual mentally sees things and this explains why people have different views because they perceive things differently. This is why communication within the organisation has to clear so that one receives the same core intent of the message. The last factor is the individual personality. Personality is the total pattern of characteristic ways of thinking; feeling and behaving that constitute the individual distinctive method of relating to the environment. Approaches to management and leadership One of the most important functions of an organisation is the management. Without this function or department there will be no rules, procedures, discipline, motivation, culture and so on. The principles of management and leadership will be divided into a number of sections to be analysed in detail. Most of these theories and styles will be related to TESCO and MARKS AND SPENCER for a wider discussion and explanation. Management Styles Managers have to perform many roles in an organisation and how they handle various situations will depend on their style of management. A management style is an overall method of leadership used by a manager. The most common style theories are grouped under the classification: autocratic style , democratic style and laissez faire style. Autocratic style is sometime known as exploitative, authoritative or military style. Autocratic style is the type of management where there is only one person in charge that has total control. Under this style of leadership all policies and decisions are laid down by the leaders. Subordinates have just to put into practice. They are not allowed to give their opinion or suggestion thus the leader is expected to do everything in terms of decision making. A democratic style of management has many advantages as it motivates employees through job satisfaction and team spirit. It makes them feel valued if they are taking part in decision-making, and this will help the organisation to achieve its objectives. There is more contact between managers and its workforce. They will be able to get to know each other and this could lead to them being able to work better together if they socialise. However, there are disadvantages to this type of management style. Consulting the workforce can be time consuming which will slow down decision-making. Laissez-faire style is a style where most of the decision and policies are decided by subordinates. Managers intervene very rarely in emergency cases. Almost everything is left upon subordinates. Every member of the organisation opinion is taken into account when making decision. Different motivational theories Motivation is a process in which people between alternative behaviour in order to achieve personal goal.Motivation is the result of an interaction between the person and a situation; it is not a personal trait. Its the process by which a persons efforts are energized, directed, and sustained towards attaining a goal. Energy: a measure of intensity or drive. Direction: toward organizational goals Persistence: exerting effort to achieve goals. Motivation works best when individual needs are compatible with organizational goals. THEORIES OF MOTIVATION There are many motivation theories that attempt to explain the nature of motivation. Some of the theories may be partially true and help to explain the behaviour of certain people at certain times. The motivational theorists focus on examining human needs considering how the needs are met and can be better met in work. It may be defined as the processes that accounts for an individuals intensity, direction and persistence of effort towards attaining a goal. Organisational behaviour (9th edition) by Stephen P Robbins pg 155 Among various behavioral theories embraced by American business are those of Frederick Herzberg and Abraham Maslow. Herzberg, a psychologist, proposed a theory about job factors that motivate employees. Maslow, a behavioral scientist and contemporary of Herzbergs, developed a theory about the rank and satisfaction of various human needs and how people pursue these needs. These theories are widely cited in the business literature. MASLOWS MOTIVATION Abraham Maslow suggested that human needs operate at a number of different levels. In fact he classified human need under five different levels namely: physiological needs, security needs. Social needs, esteem needs and self realisation/actualisation. This different of need can be presented as follows: Physiological needs: For Maslow this is the first level of needs that individuals have to satisfy because these needs are primary / basic. Physiological needs are those required to sustain life, such as: Air, Water, Food, and Sleep. Safety/Security Needs: Provided that physiological are adequately satisfied that security needs will influence on behaviour. Security needs include protection against physical and physiological harm. Such needs include the need for job security, age, industrial accidents, and illness. Many organisations try to satisfy these needs by providing a desire for steady employment, health insurance, safe neighbourhoods and shelter from the environment. Social needs: This level of needs is concerned with mans need for love, friendship; acceptance, attachments and families help fulfil this need for companionship and acceptance, as does involvement in social, community or religious groups. In organizations people tend to join different groups to satisfy their social needs. By forming groups and encouraging sufficient interaction among employees. Managers can make sure that their subordinates social needs are satisfied. Esteem needs: -. This level represents peoples higher order needs that is man needs for self respect, and recognition by others. The need for success self confidence, recognition and appreciation of achievement are all examples of esteem needs. It is this area in particular that managers can play a significant role in satisfying the needs of their employees, namely by rewarding high achievement with recognition and appreciation. Self actualisation needs: The highest of Maslows hierarchy of needs is the need for self actualisation. This represents the apex of all men needs. Self-actualizing people are self-aware, concerned with personal growth, less concerned with the opinions of others and interested fulfilling their potential. Maslow describes the self actualisation needs as follows a musician must make music and at least must paint, a poet must write, if he is to be ultimately happy. The self actualisation need is the most difficult to address. In an organisation context, a manager can help by impressing and challenging job to master so that they can in their work. Criticism of Maslows theory Maslow theory is too rigid, that is it is assume all individuals have five level of need and all of them follow the same order. It is not a complete theory of motivation, because it only explains motivation of human needs. 3.7 FREDERICK HERZBERGS MOTIVATION AND HYGIENE FACTORS Frederick Herzberg examined motivation in the light of job content and contest. His dual process theory is a job enrichment theory of motivation. It describes needs in terms of satisfaction and dissatisfaction. It is a two-step process. First provide hygienes and then motivators. One time ranges from no satisfaction to satisfaction. The other time ranges from dissatisfaction to no dissatisfaction. (Buelens M., Broeck H., Vanderheyden K., Kreitner R. Kinicki A., 2006, p: 186). Therefore, Herzbergs theory is also known as two-factor motivation theory. Hygiene factors According to Herzberg hygiene are those which do not lead to motivation but these factors prevent de-motivation. At a more simple level firm managers should make sure that the employees have the necessary hygiene factors so that there wont be any dissatisfaction at work resulting to a decrease in motivation. His study reveals the following as hygiene factors: Company policy and administration Supervision Relation with supervisor Working conditions Salary Personal life Relation with subordinates Status Security Motivators According to Herzberg motivators are those factors which lead to satisfaction and hence can motivate employees at work. When employees are deprived of these factors there will be dissatisfaction leading to reduction to motivation. However if employees are provided with these factors, they will surely be motivated. The main motivators are Achievement Recognition The work itself Responsibility Advancement Growth Criticism of Herzberg theory The conclusion about factors that caused unhappiness and motivators are not totally acceptable. According to critics the difference in sources of satisfaction and dissatisfaction are the result of intrinsic defence mechanism. People are inclined to seek their own achievements and to ascribe their dissatisfaction more to obstacle on the part of management. Relationship between motivational theories and the practice of management Maslow theory does not fully explain motivation his hierarchy of needs is generally accepted and applied in practice mainly for the following reasons: The hierarchy is easy to understand and make sense. The theory highlights important category of needs. The distinction is made between higher and lower needs. The importance of personal growth and self-actualisation in the work context is impressing upon managers. In most countries organisation are extremely successful in satisfying employer lower order needs. Physiological are satisfied by paying salary and providing fringe benefit, social needs are satisfied by allowing employees to interact and associate with one another. Esteem needs is of giving responsibility a title that commands respect, meaningful work, activities, recognition at high achievement.

The Miller And Modigliani Capital Structure Irrelevance Theorem Finance Essay

The Miller And Modigliani Capital Structure Irrelevance Theorem Finance Essay Contrary to Modigliani and Miller (1958, MM hereafter), Capital Structure is not irrelevant when we consider a firm with a dividend payout policy. This article extends the MM capital structure theorem by relaxing the full payout assumption and introducing retention policy. The theoretical contribution shows that it is possible to verify the theorem when we suppose an investor who exchanges his initial holding for another portfolio composed of consumption and investment. The empirical analysis of this new approach is based on a data set of the USA Electric Utilities and Oil companies for the period 1990-1998. The results show that the relationships between leverage and firm value are significantly affected by the firms payout ratio. 1. Introduction Miller and Modiglianis (1958) irrelevance theorem is one of the important and puzzling issues in modern corporate finance theory [1], which has challenged the traditional view[2], that an optimum leverage exists. The main source of the puzzle stems from the fact that financial research dont seem to explain the firm financing behaviour as we attempt to reconcile the MM theory with the evidence(Myers 1984, Gordon1994, Rajan and Zingales1995). The MM theorem(proposition I) has shown that under a perfect market hypothesis the market value of any firm is independent of its capital structure (Stulz2006). This fundamental proposition explicitly indicates that the aptitude of investors to engage in personal or homemade leverage is sufficient to ensure that corporate leverage in itself cannot modify the total market value of the firm [3]. In other words, the theorem provides conditions under which arbitrage by individuals keeps the value of the firm depend only on cash flow generated by the i nvestment policy. Literature about the validity of the MM-proposition is discussed about whether investors can really accomplish the required conditions of the arbitrage method without changing the overall value of the company. In this context, many authors have shown the inadequacy of the theorem when variables that deal with the real world are introduced. Following the seminal paper of MM (1958), most theories have been put forward in corporate finance to reconcile the shortcomings of the irrelevance theorem with variables that explain the firms choice of capital structure. According to the previous debate, criticism against this theorem can be grouped in two types of arguments: on the one hand, there are papers which deal with the limitations of the arbitrage conditions; on the other hand, there are studies which analyze the effect of market imperfections on the firms choice of capital structure. Despite the importance of these interventions, we note that all of the limitations deal with the explicit assumptions used by MM, but none deals with the critiques of the MMs implicit assumptions. More recently, DeAngelo and DeAngelo (2006, DD hereafter) have challenged MMs irrelevance dividend policy. Dealing with this alternative of earnings as fully distributed, these authors have showed the irrelevance of the MM dividend irrelevance theo rem when MMs assumptions are relaxed to allow retention. As DeAngelo and DeAngelo(2006, page 294) wrote When MMs assumptions are modified to allow retention with the NPV of Investment policy fixed, a firm can reduce its value by paying out less than the full present value of FCF, and so Payout policy matters and Investment policy is not the sole determinant of value . According to DD(2006), the MMs irrelevance theorem forces firms to choose only among dividend policies that distribute the full present value of free cash flow(FCF) to shareholders. Distributions below the totality of earnings are ruled out by the implicit hypothesis. Dealing with this alternative of fully-distributed earnings, MM(1958) used the same hypothesis in the development of the irrelevance of capital structure.. As pointed by the authors à ¢Ã¢â€š ¬Ã‚ ¦.as will become clear later, as long as management is presumed to be acting in the best interests of the stockholders, retained earnings can be regarded as equivalent to a fully subscribed, pre-emptive issue of common stock. Hence, for present purposes, the division of the stream between cash dividends and retained earnings in any period is a mere detail. MM, 1958 p266. However, MM(1958) failed to recognize that proposition I implies that firms distribute all their cash flow to shareholders without paying any attention to their retention policy. This paper constitutes a new extended proof of the MM theorem by not considering the hypothesis of earnings as fully distributed. We will show that it is possible to verify the theorem when we suppose an investor who exchanges his initial holding fo r a mix of consumption and investment. The rest of the paper is organized as follows: in the next section, we demonstrate the irrelevance of the MMs capital structure irrelevance when earnings are not fully distributed. We propose the possibility of extending of the MM theorem. Furthermore, we show that the two firms are not forced to distribute their full earnings; and the irrelevance is hold in the presence of the mix of investment and consumption. Section III describes the data set, introduces the methodology, examines the hypothesis of the variables and investigates whether the empirical Modigliani-Miller capital structure irrelevance is influenced by dividend payout ratio. Section IV provides some concluding remarks. 2. How do we reconcile MMs capital structure irrelevant theorem with the firms payout choice? 2.1 The failure of the MM theorem when earnings are not fully distributed. As indicated by Rubinstein (2003), the law of the conservation of investment value of MM(1958) was anticipated by many studies (Fisher (1930), Williams[5] (1938), Durand (1952); Morton (1954) for examples) but none of these authors have used arbitrage mechanism to prove the invariance of the cost of capital under changes in leverage. The MMs theorem demonstrates that under certain hypothesis of market conditions, the value of the firm is independent of its debt-equity ratio and is given by capitalizing the expected return generated by its assets. This model can be expressed as: for any firm j in class k (1) Where V stands for the market value of the firm, S for the market value of its common shares, D for the market value of its debts, X for its expected earnings before interest on its assets, for the capitalization rate appropriate to its class. The analysis of the MMs arbitrage steps shows the implicit hypothesis of full payout ratio which plays a crucial role in the model. The MMs capital structure irrelevance theorem constrains firms to distribute all of their earnings. In particular, we note that the validity of the proof developed by MM is based on this implicit assumption. MM(1958) consider (see MM(1958) pages 269-270 ) the return of the investor Y as a fraction of the net income available (X-rD for levered firm and X for unlevered firm) for the stockholders. (2) Where: is the return of the investor before arbitrage process, L is levered firm and U is Unlevred firm and is fraction of the total outstanding shares owned by the investor. Obviously, MM(1958) confuse artificially return of the investor(dividend return) and net income which should be distributed between dividend and retention. MM(1958 page 266) assert that the division of the stream between cash dividends and retained earnings in any period is a mere detail. When we derive the MM capital structure theorem for firms that are not distributing all their earnings as dividends, it follows a non-adequacy of the arbitrage operations, a non-proof of the irrelevance model. Table I shows the two cases used by MM(1958) when we introduce a level of payout different from 100%. Therefore, when we use the same arbitrage as MM(1958), we must then admit that the two firms distribute all the available income to verify the leverage irrelevance proposition. As will be shown later, this assumption can modify the validity of the MM theorem. To justify this thesis, we suppose the same steps of the MM first proposition but with a slight difference: here we suppose that firms are not constrained to distribute all of their earnings. This means that we introduce in the arbitrage reasoning the payout ratio (PR) as a new variable. Table I below shows that MM theorem is not verified. The difference between returns (before and after arbitrage operations) is not the sa me as showed by MM (1958). Table I. The irrelevance of the MM capital structure irrelevance when payout ratio is different from 100% First possibility  : VL > VU Second possibility  : VU > VL First stage  : the initial return of the investor YL Second Stage: Arbitrage process Sold his initial worth of the firm L Borrows an additional amount dL with the same interest rate r Acquired new shares of the firm u sold his initial worth of the firm U Acquired new shares of the firm L Acquired new bonds b of the firm L Third stage: the return of the investor YU Final stage: Difference of earnings à ¢Ã‹â€ Ã¢â‚¬  Y= YU -YL Interpretations It is not possible to verify the MM results when we introduce the hypothesis of payout ratio different from 100%, the difference of returns will depend on the all components of the equation. When we pose PRL=PRU=1, it is easy to obtain the same difference of returns as MM(1958): or Notes: Using the MM formulation, we consider two firms L and U, for which the expected return is the same XL = XU = X. Company U is financed entirely by stock SU and company L by stock SL and debt D. The market value of each firm is then VU = SU and VL = SL + D, We denote PRL and PRU the payout ratios of the levered and unlevered firms (MM 1958 suppose PRL = PRU = 100% all expected return is distributed).sL =SL, sU =SU denote the value of shares owned respectively by an investor in the levered and unlevered firm with a fraction 2.2 The possibility of extension;The two firms are not obliged to distribute all their income: the mix of investment and consumption solution. The object of this section is to show that it is possible to demonstrate MMs proposition I without the hypothesis of earnings are fully distributed. In other words, we present an extension of the MM capital structure theorem for the case in which firms are allowed to have a payout policy. To prove this new proposition, we suppose the same hypothesis used by MM (1958), except that earnings are not fully distributed. Using the MM formulation, we consider two firms U, L for which the expected return is the same XL = XU = X. Company U is financed entirely by stock SU and company L by stock SL and debt D. The market value of each firm is then VU = SU and VL = SL + D. * Case 1: we suppose the value of the levered firm VL , to be greater than that of the Unlevered firm VU ( ). We denote respectively, PRL and PRU the payout ratios of the levered and unlevered firms (MM 1958 page 269) suppose PRL = PRU = 100% all expected return is distributed). First stage (initial return): consider an investor who owns sL dollars worth of the stock in the company L representing a fraction of the total outstanding shares SL, where sL= SL. His return YL can be written as: (3) The return from this portfolio, denoted by YL, will be a fraction of the income distributed for the stockholders of company L, which equals the multiplication of the payout ratio PRL by the difference between to total return X and the interest charge r DL. Where, r is the interest rate which the firm pays on its debt D. Second Stage (Arbitrage process): now suppose that an individual investor who adjusts his own personal leverage in order to increase his profits. He makes the following operations: (a ) Sold his worth sL of the company L and he divided it as follows: (i) he partially invested an amount IU = PRL.sL (which equals: IU=PRLSL) in acquiring shares (ii) he consumes the remainder CL= (1-PRL)SL. where sL= IU + CL . (b) Borrowed an additional amount . (c) Acquired an amount of the shares of the company U. He could so by using the amount IU from the sales of his initial holding and the amount d from borrowing. Third Stage (the new return): the income of the investor ((i) who holds sU dollars worth of the shares of the company U (ii) and who must pay interest of personal debt d would be: (4) Last Stage: Arbitrage profit: Comparing (4) with (3) we obtain: (5) Thus, under this approach we can distinguish two situations: First situation: If PRU= PRL = 1 then we find the same result as obtained by MM (1958 page 270). (6) Second situation: We can also verify the same result of MM(1958 page 270) without the hypothesis of PRU = PRL = 1, we can simply assume PRU = 1, while the payout ratio of the levered firm PRL is likely to vary between 0% and 100%, we get then: (7) From equation (7), we conclude that as long we must verify, so that it pays shareholders of corporation L to sell their investments, by this means decreasing SL and hence VL, and replace them with a mix of consumption and portfolio investment, which contains shares of the unlevered firm and personal debt, thereby growing SU and thus VU. This arbitrage process will be finished when equilibrium restores the stated equalities between the values of the two firms. * Case 2: we suppose the value of the unlevered firm VU , to be larger than that of the Levered one VL ( ). First stage: The return of the investor who holds sU dollars of shares of company U representing a fractionof the total outstanding stock SU . Where (8) The return from this portfolio denoted by YU will be a fraction of the income distributed to shareholders of the unlevered firm U. Second stage: suppose that the investor exchanges his initial holding in U by another portfolio in the levered firm L. The arbitrage process with consumption behaviour will take the following form: the investor sold his worth of company U: and divided it as follows: (i) He invested partially of the shares of the company L (ii) He invested also of bonds of the company L (iii) The remainder will be consumed. From IL and IB , we can write respectively: Third stage: The return of the investor (i) who holds IL dollars worth of the shares of the company L (ii) and who holds IB dollars worth of bonds of the company L. (9) Last stage: Arbitrage profit: comparing YL (from 9) with YU (from 8) we obtain: (10) In order to get a profitable arbitrage opportunity for the investor, we must consider a positive difference of returns. Analysing equation (10), we can easily formulate two possibility of payout ratio: In the first, if we suppose a full earning model for the two firms (PRL = PRU = 1), therefore we will obtain the same results as showed by MM(1958) (page 270). According to this situation, equation (10) can be written as: (11) In the second, the MMs results can also be obtained if we just assume a full earnings for levered firm PRL= 1 while the payout ratio of the unlevered firm PRU is likely to vary between 0% and 100% implying that the firm can use a payout policy, which is not restricted to full earnings. Such a representation is written as: (12) In this context, it is also important to show that as we must obtain , hence it pays the shareholders of company U to sell their holdings and substitute them with a mix of consumption and portfolio investment, which contains shares and bonds. If, all investors in firm U will accomplish the three stages below, decrease the value of the unlevered firm U and increase the price of the levered firm L. This switching process will be over when equilibrium restores the stated equalities between the values of the two firms. From these demonstrations (case 1 and case 2) we can conclude that we are not compelled to suppose that the two firms distribute all of their returns. In other words we can make arbitrage process merely by considering that the overpriced firm (levered firm L in the first case and unlevered firm U in the second case) has a payout ratio PR which is not restricted to be 100% of the earnings. The table below summarizes the theoretical findings. Table II: the MMs arbitrage and the payout hypothesis Conditions Conclusions MMs arbitrage conditions without dividend payout MMs(1958) irrelevance theorem MMs arbitrage conditions with a payout ratio Failure of the MMs proof MMs arbitrage conditions with a payout ratio and consumption hypothesis Proof of the MMs irrelevance theorem(Extension) 3. The Empirical Analysis The previous part of this paper provides a new extension of the relationship between firm value and capital structure when the firm has a payout policy. In this section, we attempt some possible empirical tests. The central issue is, whether or not the leverage ratio affects firm value when earnings are not fully distributed?. Modigliani and Miller (1958) have taken two samples of 43 electric utilities during 1947-1948 and 42 oil companies during 1953. The data are provided respectively by two studies conducted by Allen (1954) and Smith (1955); and they estimated the weighted average cost of capital (wacc) according to the financial leverage of the firm. The regression form of the model was: (13) Where wacc is the weight cost of capital approximated by X /V , here X is the expected return net of taxes, V is the market value of all securities and the financial leverage of the firm measured by the ratio D/V, where D is the market value of Bonds and preferred stock. The results of the tests (as shown MM(1958page 282) are favourable to Modigliani and Miller (1958)s hypothesis. The values of the correlations coefficients are small and not statistically significant. Weston (1963) criticizes Modigliani-Miller empirical result. In particular, he assumes that the lack of effect of capital structure on the overall value of the firm is due to deficiency of the approach to take account of other factors that may be influencing the firms cost of capital. Contrary to MM, the author shows in the empirical tests that leverage is correlated negatively with firm value in the presence of the hypothesis of earnings growth. 3.1 Data and Methodology In order to conduct an empirical analysis similar to MMs, we have collected data on the same sectors from the same country as done by Modigliani and Miller 1958. The data we use are annual standardized financial information of US firms observed in the period 1990-1998. Our sample is formed by two sub samples: from the Electric sector we use 256 companies, and from the oil sector we take 223 companies. These data were obtained from the Worldscope Database (SIC Code 13 and 49). Contrary to Weston(1963), we consider the hypothesis of risk-class can be verified in the oil industry and the electric sector (as supposed by MM 1958). According to MM(1958), a linear model was constructed to explain the relationship between leverage and the firm value. The variables used in our regressions are constructed (see table III) as the same way as presented by these authors. The corresponding models used by MM(1958) are: For Model 1 :see MM(1958) page284 (note 38), for model 2,see MM(1958) page282; For Model 3,see MM(1958) page284 (note 39); For. With regard to the basic capital structure irrelevance theorem to be estimated; we propose three regression models as follows: Model 1: (14) Model 2: (15) Model 3: (16) Where wacc is the weighted average cost of capital; Leverage 1: first measure of leverage; ML1: modified leverage 1; Value: the ratio of the firm value; , ER: earnings ratio; DR debt ratio. The purpose of model 1 is to test the effect of leverage (as measured by Debt ratio DR) on firm value, while the Model 2 and model 3 test the effect of leverage (measured by Leverage1) on the cost of capital (measured by WACC). The variable ML1(modified leverage 1) is included in model3 to test the U-shaped hypothesis that the coefficient e of this variable should be significant and positive to confirm the traditional view, and not significantly different from zero to confirm the irrelevance theorem.. Note also that according to our approach the correlation between these variables should be different from zero. To test the validity of the MMs proposition when earnings are not fully distributed, we alternatively estimate all the above regressions in the absence (model MM58 and the model MM58supp) and the presence of the payout ratio. We validate this last alternative in two steps: In the first step, we test the models for all firms (model MMExt). In the second step, we test the models for subsamples: First Quartile sample (Firms Payout ratio is less than 25%), Second Quartile sample (firms payout ratio is between 25% and 50%), Third Quartile sample (firms payout ratio is between 50% and 75%), and Fourth Quartile sample (firms payout ratio is more than 75%). The tableIII below reports the different measures of variables and their predicted effects. Table III. Measures of variables and predicted signs Variables Symbol Measure MM Hypothesis Our Hypothesis Dependants variables Weighted average cost of capital WACC X/V Firm value ratio Value V/A The explanatory variables First measure of leverage Leverage 1 D/V Zero effect Significant effect Modified Leverage 1 measure ML1 D.D/V.S Zero effect Significant effect Earnings ratio ER X/A Debt ratio DR D/A Zero effect Significant effect Payout ratio Payout Div/NI Not tested Significant effect Notes: the table reports the different measures of variables where V: firm value= market value of equity S +market value of debt D, X: Earnings before interest and Taxes (EBIT), A: is the value of the total assets, NI net income. ML1 modified leverage 1 measure = (D/V) ²/(1-D/V). We measure the value of the Debt D by the amount of total liabilities. 3.2 Descriptive statistics As indicated in Table IV, the descriptive statistics shows that the average value of cost of capital is 5.92% for electric utilities and 4.48% for oil companies[6]. On average, we have a leverage ratio of 51.79%(37.85%), this measure is 62% (50.2%) when we use total assets as deflator . The average firm has a value ratio of 1,38 for electric utilities which is much weaker than those of oil companies (1,99). For these firms, earnings ratio ranges from 0% to 2.7% for electric utilities (0% to 66% for oil companies). In terms of net income, the average value of payout is more important for electric utilities (45%) ranging from 0% to 99,9%, than those of oil companies (16%). These results show that the division of the stream between cash dividend and retained earnings in any period is not a mere detail as supposed by Modigliani and Miller (1958 page 266). None of firms in the two samples and during the whole period (1990-1998) has distributed the totality of its income. For the normal di stribution of the series around the mean (see table IV), all of the distributions of the variables are not symmetric since their skewness values are different from zero. This conclusion is also verified by the values of the Kurtosis which are quite different from 3. Table IV. Descriptive Statistics of Variables (256 Electric Utilities and 223 Oil Companies) Variables Sample Mean Minimum Maximum Std. Dev Skewness Kurtosis Obs WACC Elect 0.05924 0.00000 0.29090 0.03188 0.292328 6.376099 2304 Oil 0.04481 0.00000 0.69582 0.05448 4.75993 42.0526 2007 Leverage1 Elect 0.51796 0.01573 0.99416 0.17873 -0.46925 3.36365 2304 Oil 0.37857 0.0000 0.98237 0.21714 0.20952 2.36431 2007 Value Elect 1.38155 0.09087 9.77112 0.82268 5.51989 45.7871 2304 Oil 1.99172 0.14447 138.56 5.40308 18.7716 397.615 2006 ER Elect 0.07353 0.0000 0.027612 0.04158 0.77790 7.94274 2304 Oil 0.06418 0.0000 0.664303 0.06683 2.104262 11.546 2007 DR Elect 0.62322 0.02761 0.995066 0.14891 -0.9991 4.78983 2304 Oil 0.50220 0.0000 0.9978 0.22065 -0.2593 2.4847 2006 ML1 Elect 1.34913 0.000252 169.346 6.6480 17.3645 344.950 2304 Oil 0.61298 0.0000 23.2454 1.5346 8.6309 103.96 2006 Payout Elect 0.45169 0.00000 0.99980 0.35978 -0.15569 1.40417 2304 Oil 0.16381 0.0000 0.9991 0.27721 1.50967 3.90646 2006 3.3 The effect of Leverage on the firm value (model 1) The MM(1958)s theorem is confronted with our hypothesis in order to know the crucial effect of payout ratio on the sensitivity of firm value to leverage. If our prediction is true, we should find a significant coefficient of leverage ratio, otherwise the MMs view should be confirmed. As indicated in table V, estimates result shows that coefficients of earning ratio (ER) and debt ratio (DR) are significantly different from zero, which fails to support the MMs view. Since our results, as presented below, demonstrate that the coefficient of debt ratio is significantly negative and contrary to the traditional view. We prefer to give more explanations of this relationship based on the presence of the payout policy. The latter has a negative influence on the two samples (see Model MMExt , table V) which is in the opposite direction as obtained by the cost of capital regressions (see tableVI). There are two main explanations for this result: According to Brigham and Gordon(1968), the relationship between stock price and leverage depends on the association between R (return on assets and investment) and i ( the rate of interest which the firm pays on its debt), not on the level of Leverage L. This can be written as: (16) Where E is the book value of the common equity per share, k is the rate at which dividend is discounted. It is evident, when R is less than i, the leverage effect on stock price P will be negative. Furthermore, the negative influence of the dividend ratio on the firm value confirms the leverage impact when the return on investment is less than the cost of debt. This means that firms experiencing lower rate of investment tend to use funds from internal and external resources to display higher payout ratio. The leverage measure is not the same: in Wacc regression, this variable is measured by debt on firm value (D/V), while in firm value regression (Value), the debt ratio is measured by debt on total Assets (D/A). The fact that both variables are divided by different deflators may be affected by a random disturbances of the market value of the firm. This bias correlation is not observed in the firm value regression. According to Modigliani and Miller (1958), the constant term in the previous regression should give more information on the value of the unlevered firm. As shown in table IV below, the estimated coefficient of this variable is not only significantly different from zero, but is quite positive and greatly relative to the coefficient of the debt ratio. This conclusion is confirmed for the two samples with large values for the oil companies. Table IV. Directs Pooled Least-Squares Estimates of the effects of leverage on the firm value Coefficients of Regressions Sample Constant ER DR Payout AdR ² Obs MM 58 Elect 1.893a -0.158a -0.805a 0.025 2304 Oil 2.464a -6.730a -0.668 0.048 2007 MM Ext Elect 1.963a -0.131a -0.466a -0.625a 0.095 2304 Oil 2.465a -6.703a -0.642 -0.086 0.048 2007 First Quartile Elect 1.969a -0.133b -0.412c 0.005 801 Oil 2.342a -7.490a -0.286 0.052 1440 Second Quartile Elect 1.465a 2.650a -0.554a 0.187 216 Oil 1.659a -0.197 -0.501a 0.033 279 Third Quartile Elect 1.206a 1.823a -0.249a 0.096 738 Oil 1.224a 3.229a -0.055 0.113 207 Fourth Quartile Elect 1.080a 1.809a -0.105 0.102 549 Oil 7.197a 0.983 -9.064a 0.676 72 Notes: a, b and c indicate significance at the 1%, 5%, and 10% levels respectively. 3.4 The effect of leverage on the cost of capital (model 2 and Model 3) According to Modigliani and Millers proposition I: the average cost of capital Wacc (Xt/V) should tend to have the same value independently of the degree of leverage MM (1958, page281). In other words, the leverages coefficient parameter in the Wacc regression should be insignificant and statistically equal to zero. The results of the MM model tests are shown in table V (models: MM58 and MM58supp). According to this table, the MM hypothesis is only verified in the oil sample, while leverage in the electric utilities has a negative and significant effect (coefficient is equal -0, 1162) on the cost