...SIGNALLING, STRATEGY & MANAGEMENT TYPE Introducing Framework T3 and GEMS for Business Strategy Patrick A. McNutt The usual disclaimer applies. The views expressed here are those of the author This is an E-book. It is available in camera copy format with free download from www.patrickmcnutt.com. December 2008 ACKNOWLEDGEMENTS Thank you for reading the E-book and making a contribution to the charity as identified on my web portal. The E-book can be read independently or in conjunction with the Kaelo v2.0 software tool. Some of the arguments are filtered from McNutt (2005): Law, Economics and Antitrust and from books referenced in the E-book. There are indeed numerous references and secondary readings recommended in the E-book. These should be read as well. They will be fully referenced as we continue together to write this E-book on the web. Interesting books on related themes to read are Roberts (2004): The Modern Firm: Games, Strategies and Managers and Nalebuff and Dixit (2008): The Art of Strategy. For my MBA students you will be reading either Baye (2008): Managerial Economics and Business Stratagy or Besanko (2007): Economics of Strategy. For clients using my services, a note of thanks and for management in general who may happen upon this E-book a set of business slides are available as one set called Framework T3 and GEMS which is available from the author. They will appear also on my web page. Please email your comments to me via my web portal at www.patrickmcnutt.com...
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...SIGNALLING, STRATEGY & MANAGEMENT TYPE Introducing Framework T3 and GEMS for Business Strategy Patrick A. McNutt The usual disclaimer applies. The views expressed here are those of the author This is an E-book. It is available in camera copy format with free download from www.patrickmcnutt.com. December 2008 ACKNOWLEDGEMENTS Thank you for reading the E-book and making a contribution to the charity as identified on my web portal. The E-book can be read independently or in conjunction with the Kaelo v2.0 software tool. Some of the arguments are filtered from McNutt (2005): Law, Economics and Antitrust and from books referenced in the E-book. There are indeed numerous references and secondary readings recommended in the E-book. These should be read as well. They will be fully referenced as we continue together to write this E-book on the web. Interesting books on related themes to read are Roberts (2004): The Modern Firm: Games, Strategies and Managers and Nalebuff and Dixit (2008): The Art of Strategy. For my MBA students you will be reading either Baye (2008): Managerial Economics and Business Stratagy or Besanko (2007): Economics of Strategy. For clients using my services, a note of thanks and for management in general who may happen upon this E-book a set of business slides are available as one set called Framework T3 and GEMS which is available from the author. They will appear also on my web page. Please email your comments to me via my web portal at www.patrickmcnutt...
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...land transport system. From an economic point of view, taxis are still considered luxury items as compared to buses and trains, the number of people resorting to taking taxis as a form of transport will increase gradually because the income parity gap has become narrower as the educational level increases by generation. However, there has been negative sentiment towards public transport operators after the recent taxi fare hikes and increasingly frequent train service breakdowns in Singapore. These incidents have dampened and shaken the confidence of the public recently. Increase in Oil Prices Oil prices are affected by supply and demand and has been increasingly volatile amid with a slower economy growth outlook. Oil is a vital input for the production of a wide range of goods and services, in ComfortDelgro’s case, it is mainly used for transportation purposes and with higher oil prices in the case of diesel which is the main source of petroleum for buses and taxis means higher cost of inputs. Part of the burden will be borne by the commuters inevitably and if that alone does not solve the problem, the total revenue of ComfortDelgro will be affected and will incur lesser earnings. Increase in Fare Hikes (Taxis)...
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...industry are controlled by private owners for profit rather than by the government. There are both advantages and disadvantages to capitalism in Australia but it truly benefits everyone including the Business sector, Government and Society. Since the economic and political systems are controlled by the private sector to gain profit, it'll encourage the owners and the employees to be efficient and produce quality goods and services. This will increase GDP (Gross Domestic Product) in Australia, and therefore it will also increase the country’s economy which will benefit both the government and the society. As most of us have discussed capitalism definitely benefits the society, because it opens up competition and this will lead private companies to produce quality goods and services for a cheaper price, also people will have a say on what to purchase and from whom they want to purchase it from. Capitalism is a system of governance for economic affairs that has emerged in different settings and continues to evolve...
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...In the corporate world, a firm would be more profitable if there is lesser intensity from the rivalry among existing firms, the lesser danger of potential entrants and higher barriers to entry, lesser substitutes for the firm’s products and a weaker bargaining power of the consumers and suppliers. Competitive incumbent firms or existing businesses in a particular market adopts strategic entry deterrence to discourage potential entrants from entering into competition in the market. These actions from the existing companies create and strengthen barriers to entry for the industry for new entrants. However, this course of action causes market to lose competition and some might even be illegal. Not all industries and not all companies respond in the same way, the strength and aggression of the response varies accordingly to the current market trends, conditions and consumer behaviour. In this essay, we will discuss on several strategic actions taken by the incumbent firms to create, maintain or increase deterrence on new and potential entrants and thereafter, analyzing the credibility of each action. There are many types of barriers to entry into a market, including factors like high capital costs, differentiated product, costs of switching, distribution network, economies of scale, suppliers, barriers to exit and legal and government created barriers. High capital cost: In an industry that demands a larger capital investment during the starting up process, it will act as a...
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...Promotions, HRM and customer service. | Moderating /mediating variable | Emotions, past experience etc | Hypothesis | H1: sales is the operatinghierarchy. We also find the first empirical evidence thatintermediate effects are dynamic constructsH2: Their hypothesized model alsoconjectures the presence of a feedback loop from salesto experience. The authors argue that a consumer’smind “is not a blank sheet, but already containsconscious and unconscious memories of product purchasingand usage.is positively correlated with impulse buying. | Author Name | Ganesh Iyer, David Soberman and J. Miguel Villas-Boas | Article Name | The Targeting of Advertising | Year | 2005 | Dependent Variable | Profits | Independent Variable | Advertising, Price and segmentation. | Sample Size | --------------------- | Exogenous Factors | Market environment | Endogenous Factors | Purchase timing, awareness and brand switching | Mediating/ Moderating variable | Attractiveness of advertisement. | Summary | - Major improvementsin the quality of consumer information and the growth of targeted media vehicles allow firms toprecisely target advertising to consumer segments within a market. This paper examines advertising strategywhen competing firms can target advertising to different groups of consumers within a market. | Article 3: Author Name | Advertising and Conspicuous Consumption | Article Name | Daniel Krähmer | Year...
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...Faculty of Business, ALHOSN University, Abu Dhabi, UAE E-mail: r.pillai@alhosnu.ae Abstract The literature on dividend policy has produced a large body of theoretical and empirical research, especially following the publication of the dividend irrelevance hypothesis of Miller and Modigliani (1961). No general consensus has yet emerged after several decades of investigation, and scholars can often disagree even about the same empirical evidence. This paper aims at providing the reader with a comprehensive understanding of dividends and dividend policy by reviewing the main theories and explanations of dividend policy including dividend irrelevance hypothesis of Miller and Modigliani, bird-in-the-hand, tax-preference, clientele effects, signalling, and agency costs hypotheses. The paper also attempts to present the main empirical studies on corporate dividend policy. However, due to the enduring nature and extensive range of the debate about dividend policy which has spawned a vast amount of literature that grows by the day, a full review of all debates is not feasible. The paper reaches at a conclusion that the famous statement of Fisher Black about dividend policy "the harder we look at the dividends picture, the more it seems like a puzzle, with pieces that just do not fit together" (Black, 1976, p. 5) is still valid. Keywords: Dividends, Dividend Policy, Dividend Policy Theories JEL...
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...acquisition. GE's offer was accepted by Alstom at €12.35bn in April 2014, but then the French government rightfully forced some changes in the deal structure. To win the approval from the French government, GE’s newest proposition involved setting up joint ventures in renewable energy, electricity grid equipment and nuclear power. In fact, the value of the stakes Alstom will own in the three joint ventures is estimated to be about €2.6bn which means that the net cash cost of the deal for GE is about €9.7bn. Moreover, the US and European regulators required the sell-off of part of the GE’s turbine business to the Italian Ansaldo Energia in order to keep the market competitive. Before GE got the “green light” from Paris, there was lot of competition between GE and the joint offer of Siemens and Mitsubishi Heavy Industries for the acquisition of Alstom, even though the board of Alstom favoured GE’s clear and simple offer. Moreover, GE promised to add about 1000 new jobs in France, where it has had large existing operations for decades. On the other hand, the government liked the fact that Mitsubishi-Siemens offer was based on forming a partnership and was not going to be a takeover. Finally, when GE modified its proposal, it won the war. About General Electric General Electric, headquartered in Fairfield, Connecticut (US), is a multinational leading corporation with a highly diversified business. General Electric is a key player in the...
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...only underwear, but also: clothing, leather goods, jewelry and cosmetics. Presently Intymna.pl receives over a million visits monthly and fulfils up to 5000 orders every month. Its customers come from 140 countries. The strength of Intymna.pl is its broad range of products, holding brands sold exclusively and high availability of goods which resulted in gaining trust of thousands of satisfied and loyal customers. According to the report E-commerce 2012 it is the third largest online shop in the “fashion” category. It ranked third in this category also in the report of Money.pl, where as many as 60 criteria are taken into account when assessing the polish online shops. The company has for many years been nominated for rankings and competitions, gradually gaining honours and awards, e. g. the main prize in the "Fashion Website Awards 2010" and honourable mention in the editing of the same in 2011, with distinction in Business Wings ranked 2011 in the category of micro-enterprises. The products offered by the company (in particular, own brands) are appreciated by stylists from the biggest Polish media houses, which results in publications of the same product/brand store in journals such as Avanti, HOT Fashion & Shopping, InStyle, as well as in magazines targeted at women, such as Glamour, Flesz, Joy. Intymna.pl sells more than 10 000 different products, including unique brands available only at Intymna.pl. It offers a large selection of lingerie including bras, figs, sleepwear...
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...The Hindu rate of growth is a derogatory term referring to the low annual growth rate of the planned economy of India before the liberalizations of 1991, which stagnated around 3.5% from 1950s to 1980s, while per capita income growth averaged 1.3%. India’s economic performance during the first three decades since independence was christened the “Hindu” rate of growth, a term connoting a disappointing but not disastrous outcome The word "Hindu" in the term was used by some early economists to imply that the Hindu outlook of fatalism and contentedness was responsible for the slow growth. The later economists attribute the rate to the Government of India's protectionist and interventionist policies (see Licence Raj), rather than to a specific religion or to the attitude of the adherents of a particular religion. That cliché, of course, is gradually lapsing into disuse thanks to the remarkable transformation in India during the last two decades. Since 1980, its economic growth rate has more than doubled, rising from 1.7 percent (in per-capita terms) in 1950-1980 to 3.8 percent in 1980-2000 Until 1991, India’s policy makers followed misguided policies that closed the economy to international trade, erected inefficient industries under state guidance, riddled the private sector with extraordinarily cumbersome and detailed regulations, and suffocated private economic activity with controls and bureaucratic impediments. Then in 1991, the big breakthrough happened. Spurred by a...
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...Learning legacy Lessons learned from the London 2012 Games construction project Programme Baseline Report Champion Products are examples of tools and formats used by the Olympic Delivery Authority (ODA) in executing its programme. The ODA is publishing these as part of its Learning Legacy in the anticipation that they may be of use to future projects seeking best practice examples of tools and templates that have been used successfully on a large, complex programme. Purpose of the document, description and how it was used The purpose of the Programme Baseline Report was to provide a comprehensive summary of the ODA’s Olympic Programme, detailing scope, programme, budget and risk against which performance could be measured both internally and externally. The scope defined in the report includes all works required regarding site platform and infrastructure, venues, transport, and legacy transformation. This document was used to present a comprehensive statement of the scope of works required and the necessary budget for delivery. Once the document was agreed at the commencement of the programme, delivery of the works was monitored against the baseline and change could be managed robustly. Olympic Delivery Authority Programme Baseline Report Summary November 2007 report The report was updated in 2009 reflecting the status of the programme two years after the original report and after substantial completion of the ODA’s Games-time...
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...Association are collaborating with JSTOR to digitize, preserve and extend access to The Journal of Finance. http://www.jstor.org THE JOURNAL OF FINANCE * VOL. XXXVII, NO. 5 * DECEMBER 1982 A Theory of Capital Structure Relevance Imperfect Information ROBERT HEINKEL* under ABSTRACT Firms raise debt and equity capital to finance a positive net present value project in perfectly competitive capital markets; firm insiders know the function generating the random firm cash flow but potential capital suppliers do not. Taking into account the incentives of insiders to misrepresent their firm type, capital suppliers attempt to design financing mixes of debt and equity that eliminate the adverse incentives of insiders and correctly price securities. Necessary conditions for a costless separating equilibrium are developed to show that the amount of debt used by a firm is monotonically related to its unobservable true value. STIGLITZ[19] AND FAMA [5] DEMONSTRATE...
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...Action Plan for Reed’s Growth Background: Meredith Collins, VP of Marketing, Reed, needs a plan for 2011 to execute to grow its current market share from 14% to 16%. Margins for error are negligible as competition has intensified in every segment and current economic conditions aren’t looking good. Recommendations for Growth: Stop the dollar special for each week: 1st step is to stop the dollar special promotion immediately. This is not consistent with the brand equity and positioning built over the years. It’s resulting in net operating loss of 76% on each discounted item and overall decreased the net operating profit for 2010 to 0.4% only. Moreover, this promotional activity is polluting the message for regular consumers, considering that some of the dollar stores are located nearby. Increase Sales Target: To increase the current market share to 16%, sales target is set to 775Mn for 2011. It’s an increase of 95Mn. from 2010, on the assumption that total market size (4.74Bn) remains same. Focus and Maintain current Target Segment and Increase the Wallet Share: Continue focusing on the current target segment of affluent and older customers with smaller household size. Their wallet share is 8.93% only as compared to average supermarket customer’s wallet share of 10.0%. Wallet share of Reed customers will be increased by at least 1% which will result in additional revenue of 79Mn/year. Maintain current Brand Positioning: Maintain current brand positioning by serving...
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...Padgett Paper Products Case Study Solution Case Solution Outline -Summary -Problem Statement -Company -Market -Product -Projections -Options -Current Capital Structure -Proposed Capital Structure -Review Summary Objective: To find a mutually acceptable debt structure that will minimize lender risk while increasing company value. Constraints: 1) realistic cash flow projections, 2) Bank safety levels Situation for each Business Group Bank: Over extended and is in a bad situation. Lending exceeds reasonable levels and is not collateralized or subject to covenants. An $8 million loan is abnormal for the bank. The company’s management does not appear to understand the unrealistic debt situation, the impact on firm value and impact on the upcoming audit report. Management: Has unrealistic expectations and a lack of understanding of impact of current structure of firm value. Company: The Company has considerable levels of equity and is not maximizing its financial structure. It is capable of taking on considerably more debt, however, the debt needs to be more appropriately structured. Ownership: Closely-held company with owner having little interest in management. Owned for dividend distribution. Problem Statement: Because of inflation and an acquisition, Padgett's financial needs have risen to a permanent level rather than being merely seasonal in nature. Management at the company's bank must revise Padgett's debt structure in a mutually satisfactory...
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...availability in amounts less than sufficient to satisfy all wants or desires. The test for scarcity is price hence only goods that are not scarce command a price.Therefore economists try to explain how this economic problem is solved by different economic systems. There are three economic systems that exist in the world today that is the free market, command and mixed economy. These economic systems have different ways in which they try to answer the fundamental economic questions of “What? How? And for whom to produce for? Samelson and Nordhaus define a market economy as an elaborate mechanism for cording people, activities and business through the a system of price and markets. Production is mainly driven by the market forces of demand and supply, which determine price hence it is termed as the price mechanism. The USA is an example of what can be simply classified as a market economy. Thus by matching sellers and buyers in each market, the three fundamental questions of what? How?, for whom?. Consumers determine what goods and services will be produced by their dollar votes, which means their daily purchasing decisions. Firms in the market economy are profit motivated therefore they abandon areas where they are losing profits and lured by high profits into production of goods in high demand. The question of “How” goods and services are produced is determined by the competition among different producers. Hence the best way for firms to remain competitive in the market economy...
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