Swot Analysis Giant Step Records free essay sample

Innovative Culture and Innovative Competencies Assignment

Inventive Culture and Innovative Competencies - Assignment Example Unions are, hence, helpful roads of not just accessing the aptitudes and capacities of accomplices, yet additionally serve to fortify the center skills inside associations. Without a doubt with the globalized rivalry, it is not, at this point conceivable to contend in the conventional feeling of independence, which, it might be said, is unsound as business sectors progressively become profoundly unpredictable, quickly rendering strategies and items old nearly as quick as they are designed. Despite the fact that advancement has been pushed to the focal point of creation elements, the obstacles to its acknowledgment have dramatically increased, muddling its administration and making it much progressively subtle. Accordingly, firms focused on breaking new grounds start from the very establishment of tackling the imperative capabilities, with speed given priority both as far as assets and hierarchical help (Prahalad and Hamel, 1990). It is to a greater extent a typical information that b usiness is nevertheless an experience that conveys with it a few questions that requests inventiveness to accomplish the preset destinations. Important, the connection among development and development has for quite some time been a subject of hypothetical research directly from the times of Adam Smith (1776). In his â€Å"Inquiry into the Nature and Causes of the Wealth of Nations,† Smith (1776) explains gains in efficiency as a factor of specialization, division of work just as the mechanical advances in capital types of gear and procedures utilized. Other than the job of Research and Development being a key determinant of upper hand, Smith likewise perceives Technological Transfer by means of a trap of system that consolidates providers and item end-clients in that very investigation: â€Å"All the upgrades in apparatus, be that as it may, have in no way, shape or form been the innovations of the individuals who had event to utilize the machines. Numerous upgrades have be en made by the creativity of the creators of the machines, when to make them turned into the matter of an exceptional exchange; and some by that of the individuals who are called logicians or men of hypothesis, whose exchange it isn't to do anything, however to watch everything; and who, upon that account, are frequently fit for consolidating together the forces of the most far off and unique articles. In the advancement of society, theory or hypothesis becomes, similar to each other business, the head or sole exchange and control of a specific class of citizens†¦ and the amount of science is extensively expanded by it † (Smith, 1776). Floated by the supposition that there is no heterogeneous equation of securing development capacity, organized speculations have been proposed to clarify the contrasts between the about phenomenal and the poor trailblazers. The Resource-Based Approach (RBA), for example, clarifies the distinctions as an impression of the limit [resources an d capabilities] inside an offered association to go up against difficulties; assets and abilities which are by one way or another exceptional and extremely hard to duplicate or potentially substitute by different players in the market (Hamel and Prahalad, 1994). Teece and Pisano’s (1994) powerful abilities hypothesis veers off from the RBA, clarifying

Bromine Facts (Atomic Number 35 or Br)

Bromine Facts (Atomic Number 35 or Br) Bromine is a halogen component with nuclear number 35 and component image Br. At room temperature and weight, it is one of only a handful barely any fluid components. Bromine is known for its earthy colored shading and trademark harsh scent. Here is an assortment of realities about the component: Bromine Atomic Data Nuclear Number: 35 Image: Br Nuclear Weight: 79.904 Electron Configuration: [Ar]4s23d104p5 Word Origin: Greek bromos, which implies odor Component Classification: Halogen Revelation: Antoine J. Balard (1826, France) Thickness (g/cc): 3.12 Dissolving Point ( °K): 265.9 Breaking point ( °K): 331.9 Appearance: ruddy earthy colored fluid, metallic gloss in strong structure Isotopes: There are 29 known isotopes of bromine going from Br-69 to Br-97. There are 2 stable isotopes: Br-79 (50.69% wealth) and Br-81 (49.31% bounty). Nuclear Volume (cc/mol): 23.5 Covalent Radius (pm): 114 Ionic Radius: 47 (5e) 196 (- 1e) Explicit Heat (20 °C J/g mol): 0.473 (Br-Br) Combination Heat (kJ/mol): 10.57 (Br-Br) Dissipation Heat (kJ/mol): 29.56 (Br-Br) Pauling Negativity Number: 2.96 First Ionizing Energy (kJ/mol): 1142.0 Oxidation States: 7, 5, 3, 1, - 1 Grid Structure: Orthorhombic Grid Constant (Ã… ): 6.670 Attractive Ordering: nonmagnetic Electrical Resistivity (20  °C): 7.8ãâ€"1010 ÃŽ ©Ã¢ ·m Warm Conductivity (300 K): 0.122 W ·mâˆ'1 ·Kâˆ'1 CAS Registry Number: 7726-95-6 Bromine Trivia Bromine is named after the Greek word bromos meaning odor since bromine smells... stinky. Its a sharp, bitter scent that is difficult to depict, yet numerous individuals know the smell from the components use in swimming pools.Bromine was about found by two different physicists before Antoine Jerome Balard distributed his revelation. The first was in 1825 by the German physicist Justus von Liebig. He was sent an example of salt water to break down from a close by town. He thought the earthy colored fluid he isolated from the salt water was a straightforward blend of iodine and chlorine. After he learned of Balards revelation, he returned and checked. His fluid was the newfound bromine. The other pioneer was a science understudy named Carl Loewig. He isolated a similar earthy colored fluid in 1825 from another example of salt water. His teacher solicited him to get ready more from the earthy colored fluid for additional testing and before long learned of Balards bromine.Elemental brom ine is a harmful substance and can cause consumption consumes when presented to skin. Inward breath can cause bothering, in low fixations, or passing, in high focus. Albeit poisonous as an unadulterated component and in high dosages, bromine is a fundamental component for creatures. The bromide particle is a cofactor in collagen synthesis.In World War I, xylyl bromide and related bromine compound were utilized as toxic substance gas.Compounds containing bromine in the - 1 oxidation state are called bromides.Bromine is the tenth most rich component in ocean water with a plenitude of 67.3 mg/L.Bromine is the 64th most inexhaustible component in the Earths outside layer with a wealth of 2.4 mg/kg.At room temperature, essential bromine is a rosy earthy colored fluid. The main other component that is a fluid at room temperature is mercury.Bromine is utilized in many fire retardant mixes. When brominated mixes consume, hydrobromic corrosive is created. The corrosive goes about as a fire resistant by meddling with the oxidation response of ignition. Nontoxic halomethane mixes, for example, bromochloromethane and bromotrifluoromethane, are utilized in su bmarines and shuttle. Be that as it may, they are not commonly valuable since they are costly and on the grounds that they harm the ozone layer. Bromide mixes used to be utilized as tranquilizers and anticonvulsants. In particular, sodium bromide and potassium bromide were utilized in the nineteenth and twentieth century until they were supplanted by chloral hydrate, which was thus supplanted by barbituates and other drugs.The antiquated illustrious purple color called Tyrian Purple is a bromine compound.Bromine was utilized in leaded energizes to help forestall motor thump as ethylene bromide.Herbert Dow, author of the Dow Chemical Company began his business isolating bromine from brackish water waters of the Midwestern United States. Sources Duan, Defang; et al. (2007-09-26). Abdominal muscle initio investigations of strong bromine under high tension. Physical Review B. 76 (10): 104113. doi:10.1103/PhysRevB.76.104113Greenwood, Norman N.; Earnshaw, Alan (1997). Science of the Elements (second ed.). Butterworth-Heinemann. ISBN 0-08-037941-9.Haynes, William M., ed. (2011). CRC Handbook of Chemistry and Physics (92nd ed.). Boca Raton, FL: CRC Press. p. 4.121. ISBN 1439855110.Weast, Robert (1984). CRC, Handbook of Chemistry and Physics. Boca Raton, Florida: Chemical Rubber Company Publishing. pp. E110. ISBN 0-8493-0464-4.Weeks, Mary Elvira (1932). The revelation of the components: XVII. The halogen family. Diary of Chemical Education. 9 (11): 1915. doi:10.1021/ed009p1915 Come back to the Periodic Table

Asia Pacific Business Perspective for Global - myassignmenthelp

Question: Talk about theAsia Pacific Business Perspective for Global Market. Answer: Presentation Increasingly more business associations from the creating nations are entering in the universal market in the ongoing occasions. Business associations from the creating economies, for example, India and China are quickly picking up brand character because of their couple of upper hands. One of the key upper hands controlled by them is their minimal effort of creation because of the way that the expense of assets in the creating nations are a lot of lower contrasted with the created nations (Panizzolo et al., 2012). In this way, with their financially savvy items, they are quickly rising as potential challengers for the built up players in the market. Be that as it may, in entering in the worldwide market, different angles ought to be controlled by these associations so as to successfully take into account the market. One of the key variables is social angle, which is diverse in various locales. Associations need to follow with various societies in working in the worldwide market (Vaara et al., 2012). Contrasts in political and conservative contrasts are additionally key deciding components for the associations. This report will examine about the deciding elements being looked by Haier in working in the universal market. In addition, the difficulties being looked by them in putting resources into various nations will likewise be examined in this report. Organization profile Contrasted with its market rivals, the operational history of Haier is considerably less because of the way that is was being started uniquely in 1984. Haier was being begun in China as a little cooler organization. Be that as it may, with the adjustment in time, they have started forceful development procedure to encourage their development in the market. Their quick age of creative thoughts helped them to enter in different market portions of client apparatuses, for example, TV, Air conditioners, cell phones, clothes washers and vacuum cleaners (Haier 2017). This helped them to bested the rundown of most important brand of China for quite a while. Be that as it may, in their underlying stage, Haier had just worked in their nation of origin of China. In the mid nineties, they have started the arrangement of global business. In 1990, they had begun to trade their items to South-East Asia. Thereafter they have entered the western nations. As of now, they have 28 assembling offices aro und the globe alongside taking into account the clients from in excess of 58000 retail outlets in excess of 160 nations. In this way, as of now they are really a worldwide association with having various item portfolio and nearness in various nations around the globe. System started by Haier to manage CAGE issues As indicated by the CAGE system, there are four key difficulties that ought to be considered by the associations in working in the worldwide market. The first perspective is the social contrasts in quite a while (Dunning 2012). Because of this explanation, Haier has started of having the assembling offices in the host advertise. This approach helped them in viably deciding the necessity of the neighborhood market and offering the items in like manner. In addition, having the assembling offices in the host nation had helped them in utilizing the neighborhood HR, who will have more information about the nearby social perspectives. The following perspective in this system is the managerial angle. This factor discusses the separation in organization because of the tremendous market region in the worldwide business alongside various political situation. To adapt up to this test, Haier has executed the concentrated administration approach for the entirety of their assembling offices around the globe (Fischer, Lago and Liu 2013). Subsequently, all the activity offices in various nations of Haier follow with the neighborhood rules and guidelines alongside consenting to the brought together administration destinations of them from the nation of origin. The following component is land separation. In the worldwide business, the market zone is enormous to such an extent that it covers a few times zones, atmospheres and indigenous habitats. In this manner, the results of Haier are being redone as per the neighborhood situation (Wang et al. 2014). For example, they offer PC controlled fridges for the American market and items having less vitality utilization in Italy. In addition, the methodology of brought together administration style is additionally helping them in land boundaries with the assistance of refreshed correspondence advances. The last perspective is the practical separation. Haier works in various nations running from high pay to low pay economies. Therefore, their items additionally take into account various clients sections with having enhanced item portfolio. What's more, the sourcing of minimal effort segments from their nation of origin is helping them in lessening their cost further. This is because of the explanation that, China is having minimal effort of human and different business assets. Along these lines, sourcing of the modest segments from China long with using the common assets in the host nation is helping them in successfully driving their operational exercises. Consequently, by actualizing these methodologies, Haier is managing he gives expressed in the CAGE structure in their worldwide activity. Reference Dunning, J.H., 2012.International Production and the Multinational Enterprise (RLE International Business). Fischer, B., Lago, U. what's more, Liu, F., 2013.Reinventing Giants: How Chinese Global Competitor Haier Has Changed the Way Big Companies Transform. John Wiley Sons. Haier, (2017). [online] Available at: https://www.haier.com/mediakit/companyprofile/201502/t20150210_260980.shtml [Accessed 21 Sep. 2017]. Panizzolo, R., Garengo, P., Sharma, M.K. what's more, Gore, A., 2012. Lean assembling in creating nations: proof from Indian SMEs.Production Planning Control,23(10-11), pp.769-788. Vaara, E., Sarala, R., Stahl, G.K. what's more, Bjrkman, I., 2012. The effect of hierarchical and national social contrasts on social clash and information move in worldwide acquisitions.Journal of Management Studies,49(1), pp.1-27.

English Literature During Different Periods

English Literature During Different Periods Development of English Literature Nov 2, 2018 in Literature Main Periods and Gernes of English Literature English literature is considered to be one of the richest literatures in the world. It is the literature of a great nation inhabiting an island in the west of Europe. It goes without saying that literature is the reflection of nation and society, so changes which have come about from the early to the modern times have influenced English literature in a variety of ways. Thus, English literature has passed through definite periods: the Anglo-Saxon, or Old English period, Middle English and Modern English. Naturally, each of them has its own characteristic features, which are to be compared in four areas: genre/type of literature, literary techniques and styles, important themes and patterns, and heroes and characters. Anglo-Saxon literature was composed between 650 and 1100, and it developed both in poetry and in prose. However, poetry was considered to be a dominant genre, and there were two types of poems: heroic and Christian ones. Heroic poetry was influenced by pre-Christian Germanic Myth. Among the most popular genres were the epic (Beowulf), dream vision (The Dream of the Rood by Cynewulf), riddle, gnomic poetry, charms and other verses. Speaking about prose, it needs to be mentioned that it was written in Latin before the reign of King Alfred, who translated the most significant Latin texts and encouraged writing in the vernacular language. Middle English literature covers the medieval period, and it was composed in 1100 to 1500. The literature of this period was influenced by the domination of French culture, which took place after the Norman Conquest. The early Middle English period was characterized by the further development of poetry. The good examples were the Orrmulum (verse translation of the Gospels) and The Owl and the Nightingale (the first example of a debate poem). The prose of this time continued the tradition of the Old English period (saint's lives genre). Among completely new genres in literature were the romance, the fabliau, the moral tale and the animal verse. The dream vision was also still popular. Geoffrey Chaucer developed the genre of frame story and moral tale.

Islamic Opinions on Questions of the Debt Market - Free Essay Example

The chapter is divided into five sections and at the end of each section the Islamic opinion is outlined on the questions being examined. First, we discuss on government debt, second; private sector debt, third; external debt and fourth; debt financing from the firms point of view and finally draw some conclusions. Government debt consists of two parts. Internal debt (which, we also refer to as the public debt) and the external debt. Public debt is the debt owed by the citizens of a country in a collective capacity (i.e. as the government) to themselves in their individual capacities. This is quite distinct from the debt owed by the government to citizens and governments outside its jurisdiction. The term national debt, it is often suggested, should be reserved for this other category of debts. GENERAL CHARACTERISTICS OF PUBLIC DEBTS Public debts are incurred through public loans, which may be classified in various ways. In the first place, a loan may be either voluntary or compulsory. The chief advantage of a voluntary loan, as compared with a tax, is that different lenders are free, according to their circumstances and inclinations, to subscribe as much or as little as they please. But this disadvantage is lacking in a forced loan, which must be compulsorily subscribed on the same basis as a tax. The chief advantage of a tax, as compared with a voluntary loan, is that it leaves behind it no trail of charges for interest and repayment of principal. But this advantage is lacking in a forced loan, though the rate of interest on the latter may be lower than on a voluntary loan. In the second place, the conventional two way classification into short and long term debts, therefore, appears to rest on an attempt to distinguish between these highly liquid instruments and less liquid ones. Treasury bills are usuall y taken as typifying short term securities. These can in fact be taken to be the most liquid of government debt instruments. This is because: they are usually issued for 91 days or less during which time the risk of serious depreciation in the value of money is likely to be minimal; they can be sold easily on the market without any undue risk of loss; they are readily acceptable to the banks at face value as security for loans because of their near money nature and they are discountable at the central bank. Within this liquidity framework, the medium term debts can also be subsumed into the two way classification. Thus, in so far as medium instruments do not have the features of liquidity given above, it will appear that the proper place for them is with the long term instruments. However, occasionally, medium term installments are issued subject to conditions of easy discountability similar to the case of the short term instruments. In that case, the liquidity charac ter of such medium instruments becomes so enhanced so as to qualify them for inclusion in the short term category. THE ISLAMIC VIEWS ON PUBLIC DEBT In general, the governments need for debt performance mainly arises for three different reasons. It needs short-term finance to bridge the time gap between expenditures made and revenues collected or received. This need is presently met by the sale of treasury bills. Secondly, it needs medium and long-term finance for industries in the public sector as well as public utilities like transport, electrification etc. Lastly, it needs huge financial resources to meet natural calamities or to mobilize defense expenditure during a war. From the first case above, there is no net productivity or actual return involved out of which a share could be ascribed to the money capital borrowed. Since a price is already set on loanable funds in the investment market, the government has to pay interest for these short-term loans, usually obtained by selling treasury bills of short maturity. The interest paid eventually comes out of the tax revenue. Since the lenders are moneyed people and it is they who pay most of the taxes in a welfare state, it amounts to taxing the same class of people to pay them interest. The cost of administering the tax to the extent that it is related to interest payment must, therefore, be regarded as a social waste as well as an extra burden on this class necessitated by this irrational arrangement. Financing public sector industries and utilities, through interest-bearing loans suffers from the same irrationality which attends investment in the private sector. The value productivity of investment in the public sector is as uncertain as it is in the private sector, hence guaranteeing a positive return to the supplier of money capital is unfair. It amounts to transferring the entire burden of possible losses to the society as a whole, while assuring the suppliers of money capital of a guaranteed increment to their wealth. Most of the huge public debts that the modern governments are carrying originated during wars that were financed by raising i nterest-bearing loans. It is argued therefore that the state should either raise funds by taxes or, if these are not sufficient, by compulsory interest-free borrowing from individuals and business. These should be in accordance with income and/or wealth and should be amortized over a specified period of time from war taxes. Such taxes should continue even after the war, perhaps at a lower rate, until the debt has been fully amortized. The emphasis has to be on the careful evaluation of government expenditures and the elimination of as much fat as possible. Every effort should be made to increase efficiency in government spending and reduce wastefulness and corruption. It would be more appropriate for an Islamic state to finance all its normal recurring expenditure out of tax revenues. For this purpose, there is generally no justification for deficits under normal circumstances. Deficits essentially imply postponing the payment for services received by the present generation to future generations. Since the future generations, like the present one, do not wish to pay for past deficits and also wish to postpone even a part of their own burden to the future, the public debt burden continues to rise exponentially. The argument that postponing is for services to be enjoyed by future generations is not valid. In the case of government consumption or wasteful expenditure and war financing, the increase in internal public debt no doubt represents the transfer of the burden to future generations. Even in the case of government capital formation, it must be borne in mind that the present generation is receiving benefits from projects financed by past generations. It would be fair to expect that the present generation, like past ones, would leave behind more capital than it has received. The financing of all consumption spending as well as a part of the capital outlays out of lax revenues would not lead to a continual and rapid expansion of the public debt as has b een the case in most developed as well as developing countries. The easy availability of credit to governments on the basis of willingness to pay interest has led to loose financing by governments. Banks pay little attention to how borrowing countries were managing their economies and how their loans were being used. Very often governments borrow for a short-term because under normal circumstances short-term loans are easier to get and can be rolled over smoothly. The tragedy is that the funds raised through debt are not used for investment in real assets but simply to meet current expenditures, to purchase unnecessary defense hardware, or to finance projects having no economic justification. The result is a steeply rising mountain of dead-weight debt with a continuing rise in the debt-service burden. The resort to debt is made more and more as a means to put off painful, belt-tightening decisions. But greater borrowing now leads to even more borrowing in the future to maintain t he economy on its path of artificial growth and to continue the debt-service payments. To conclude this section, it is however, inevitable that the Islamic state must, of necessity, tailor its expenditure policy carefully and try its utmost to make the best use of available resources. This will be possible only if wasteful and unnecessary spending is avoided. This would necessitate that defense outlays be held within reasonable bounds, wasteful expenditure be eliminated, corruption be kept under control through moral reform of the society, and welfare spending be designed, not to enrich the vested interests but, in conformity with the teachings of Islam, to help those who are really in need. In spite of this policy of honest austerity, the Islamic state can and should have reasonable deficit levels. One way of meeting these deficits would be equity financing of projects which are so amenable. If every effort is made to reduce waste and finance government projects on an equity basis to the extent feasible, the excessive borrowing now being resorted to may not be necessary. Equity financing would, however, demand maximum efficiency and discipline in the management of such projects which unfortunately is not the case in most public sector projects. Deficits which need to be incurred even after the introduction of austerity and equity financing may be financed, in national emergencies, by compulsory lending to the government and, in normal times, by borrowing, partly from the commercial banks and partly from the central bank. The borrowing from the central bank should be within the limits dictated by the goal of price stability. It needs to be clearly stated that there is no escape from sacrifice and austerity, if economic development and general well-being are to be pursued. PRIVATE SECTOR DEBT The ultimate goal of debt policy is to influence the liquidity of the private sector in such a way that will lead to the achievement of the desired goal. This can be successfully done if the participation of the private sector is sufficiently large to form a significant proportion of their assets holding. If it is very low, for example, issue or retirement of debt will hardly go any way to influence their liquidity structure and thus effect a change in their economic behavior. It will appear therefore that a very important problem of debt management is to ensure as much participation of the private sector as possible. To start with, let us attempt to analyze briefly the various factors that influence the investment decisions of different categories of investors in the private sector. DEBT (BOND) FINANCING FROM THE FIRMS POINT OF VIEWS A firm, wishing to raise funds to meet its financing requirements, has a variety of alternatives available for consideration. It may issue common stock, bonds, preferred stock, convertible debentures, and so on, to raise funds. There are different types of bonds which have varied features. A bond is a promissory note issued by the firm to an investor. Firms, of course, do not issue bonds in  £1,000 denominations one at a time. Rather, after assessing its financing requirements the firm will issue millions of pounds worth of bonds and sell them to thousands of investors. Each new debt issue is governed by an indenture or contract between the borrower (the firm) and the lender (the investor). The contract agreement contains covenants or terms and provisions such as the interest rate, maturity date, redemption price, safeguards for lenders, and so on. Bonds can be either registered or bearer bonds. The holder of a registered bond has the bond recorded in his name in the compan ys book and receives the interest payments automatically. A bearer bond is not registered in anyones name. The bond possessor is the assumed owner also. Bearer bonds have coupons attached lo them. At scheduled dales these coupons are redeemed by the owner for the interest payment. Typical types of bonds include mortgage bonds, debentures, subordinated debentures, and income bonds. It is not necessary here to explain the different types of bonds given the subject of this book. ROLE OF DEBT IN THE FINANCIAL STRUCTURE OF A FIRM In modern business organizations capital requirements are so immense that a single source of finance is insufficient. Therefore, we notice that large corporations in general have a diversified ownership structure. But what is somewhat difficult to understand is that these organizations use different kinds of financing methods. The question then is, why do firms obtain funds through different forms of financial instruments? In particular, why do firms use both debt and equity to finance their capital needs? Now suppose the owners of a firm purchase some capital input this year which will produce some output next year. Suppose, furthermore, that if the input level is y, next years output, which for the sake of simplicity may be assumed to consist of the same goods, is (pFfvj, where p is some parameter which may be a random variable. Consider the following two financing possibilities open to the owners of the firm. They can borrow an amount y this year, pay back (1+r) y next year, where r is the rate of interest, and keep the residual, namely tyF(y) (l+r) y. Alternatively, they can sell a claim to some portion of next years output up to a value of y and then, when next years output is produced, they can settle the claim and keep whatever is left. Thus we have two possible methods of finance which apparently yield two different returns to the owners. The first of these is called debt financing (or bond financing) and the second equity financing. Controversy started after the Miller-Modigliani theorem which states that the value of the firm is independent of its financing decisions. This result was questioned given the fact that most firms have some amount of debt and equity in their capital structure. Many writers have tried to place the role of debt in a firms capital structure by relaxing the assumptions of the Miller-Modigliani theorem. In the beginning, efforts centered on the no-bankruptcy and no-taxes assumptions. If the probability of bankruptcy is positive (and it is costly to go bankrupt) then firms and individual borrowers cannot have equal access to credit markets. Firms can issue debt at a lower rate than individuals and this raises the value of the firm. On the other hand if debt payments are tax deductible then again, debt would be cheaper relative to equity. Many authors like Stiglitz, Jensen and Meckling and Grossrnan and Har have a relaxed and a somewhat different assumption of the Miller-Modigliani theorem: that the firms production function is independent of its financial structure. Stiglitz, Jensen and Meckling consider the situation of an investor who has access to an investment project but does not have sufficient funds to finance it. If the investor raises funds by issuing equity, then as he will have a less than 100% interest in the project he will not manage it as carefully as he would had he been a full owner. If, on the other hand, the investor issues debt his incentive to work is reduced much less sinc e, except in bankrupt states, he gets the full benefits of any increase in profits. Thus to Stiglitz, Jensen and Meckling, debt is a way of permitting expansion without sacrificing incentives. Suppose for example a firm has decided to drill an oil well. Suppose further that the firm has to raise the funds from outside sources. If the firm issues debt then it has to pay a fixed sum of money to the lender while if it issues equity then the lenders own a share in the oil well. Finally, assume that it is costly for the lender to monitor the performance of the project. If the lender relies on the reports of the firm there might be an incentive problem: the firm would tend to under-report the projects performance. DISADVANTAGES OF DEBT (BOND) FINANCING Mathur believes that financing with debt increases the finns financial risk because of increased levels of fixed charges in the form of interest expenses. During adverse conditions a firm can stop its dividends. However, a firm encountering adverse conditions cannot avoid its interest payments. The presence of interest-bearing debt in the firms financial structure increases the firms exposure to bankruptcy. Debt financing involves dealing with indentures and covenants. The conditions and requirements imposed on the firm by bondholders may limit the firms financial mobility in future years. There is a limit to how much debt financing by a firm is going to be deemed acceptable by the firms creditors. If a profitable firm is 100% equity-financed, it normally would not have any problems with additional equity financing. However, even if a firm is profitable, investors may be reluctant to buy its new bonds if they feel that the firm is already over leveraged and has a high financial risk. A firm that exceeds or tries to consistently exceed industry-accepted norms for debt financing may find the market very unreceptive to its new financing instruments, irrespective of whether they are bonds or common stock. ISLAMIC VIEWS ON DEBT FINANCE We have to consider the relationship between the creditor and debtor from the perspective of the creditor. He is always concerned about the safe return of the principal lent along with the interest stipulated. The best way to ensure this is to advance money only to creditworthy borrowers who have enough assets to fulfill their commitments. The creditors interests are best served when the borrower has the ability to meet his obligations irrespective of the fate of the actual project in which the loan is to be invested. Even if the project seems to be sound he will hesitate to make a loan if the borrower does not have sufficient assets independent of the projected enterprise. Debt finance goes to the most creditworthy parties, not to those with the most promising projects. Since the financiers get only the market rate of interest as stipulated in their contract with the borrower, the prospects of the entrepreneur making a higher than average rate of profit are not of immediate releva nce to them. What matters more for them is safety, which may at best require a reasonable expectation of making enough profits to pay the contractually fixed interest. Let us turn our analysis and consider the creditor-debtor relationship from the perspective of the debtor. The user of investible funds is naturally keen to employ them as profitably as he can. This may sometimes require innovation and experimentation with new methods of production. But the contractual obligation to repay the principal and pay interest irrespective of the results of enterprise acts as a severe constraint. This is true of small farmers and small-scale enterprises that do not have any reserves of their own to fall back upon in cases where the adoption of new practices does not yield good dividends. The refusal of the supplier of capital to share the uncertainties involved deprives the society of possible gains in the productivity of capital through innovation and the adoption of new techniques. We have argued above that in an interest-based system of financing productive enterprise, expected profitability ceases to be effective in ensuring an efficient allocation of investible funds because of the terms on which these funds are supplied. We shall now proceed to argue that the debt financing method is unjust and results in a mal distribution of income and wealth in society. The entrepreneur, for example, tries his best to make profits since his own rewards always rest on his making a profit. The possibility of loss in a business enterprise arises not only from the quality of entrepreneurship but from the nature of the world in which the enterprise is carried out. Therefore, there is no justification for prescribing a certain return when in the nature of things it is uncertain. Money capital seeking a positive return through enterprise ought to and must tear this uncertainly. When the enterprise incurs a loss the entrepreneur is made to tear the loss and pay the interest out of his own assets. This may result in his disability insofar as future entrepreneurial activities arc concerned. From the social and individual point of view this is very unfortunate. As we have mentioned above, the incidence of loss docs not necessarily imply bad entrepreneurship. It is in the nature of the world around us that some enterprises sometimes fail. It is sufficient to caution the entrepreneurs that in the case of failure they go unrewarded for their entrepreneurial services, earning no profits. But to disable them by depriving them of part of the assets accumulated in the past is hardly justified. It encourages the wealth owners to act as lenders and renters rather than expose their wealth to entrepreneurial risks, either directly by investing them in owner-enterprises or indirectly by offering them as collateral against loans obtained for enterprise. In a system of debt financing, the wealthier owners who choose to lend and wait, steadily grow richer over time whe reas wealth owners who choose to expose their wealth and abilities to the risks of producive enterprise have no such guarantee. Also the contractual commitment (between the entrepreneur and the financier) to repay the loan with interest is not in harmony with the reality. There is no justification for obliging the entrepreneur to pay interest if there is no positive return on the money capital invested. To claim the contrary, as prevalent in the interest-based system, requires that money capital be regarded as essentially of productive value; but this is not the case. Value is a market phenomenon and not an intrinsic property of money capital. Given the uncertainty of prices of the products the total value resulting from the employment of money capital in production may be more than, equal to, or less than its own value. This is true irrespective of who employs the money capital, its owner or someone else to whom it is advanced. The injustice of the interest-based system to th e savers and creditors becomes much more pronounced in an inflationary situation. When the rise in the rate of interest may lag far behind the rise in prices and profits, depositors may actually get a negative return if the rate of interest is lower than the percentage rise in prices. The lending rates of the banks also fail to keep pace with rising prices, leaving businessmen to collect the profits.

A Pay Model and Defining Internal Alignment - 9320 Words

OBJECTIVE EFFICIENCY * Performance * Quality * Customers * and Stockholder * Costs FAIRNESS COMPLIANCE COMPLANCE TECHNIQUE EXHIBIT 1.5 The pay Model ALIGNMENT Work Descriptions Evaluation Analysis Certificate Internal Structure COMPETITIVENESS Market Surveys Policy Line PAY Definitions STRUCTURE PPSTRUCTURE CONTRIBUTIONS Seniority Performance Merit Based Based†¦show more content†¦Job design, training, and team building may be used to reach this objective. The pay system aligned with this employer s objective may have a- policy of paying salaries that at least equal those of competitors (external competitiveness) and that go up with increased skills or knowledge (internal alignment). This pay system could be very different from our first example, where the focus is on increasing customer satisfaction. So, objectives guide the design of pay systems. They also serve as the standard for judging the success of the pay system. If the objective is to attract and retain the best and no brightest, yet skilled employees are leaving to take higher -paying. jobs with other employers, the system may not be performing effectively. Although there may be many non-pay reasons for turnover, objectives provide standards for evaluating the effectiveness of a pay system. Four Policies Every employer must address the policy decisions shown on the left side of the pay model: (1) Internal alignment, (2) external competitiveness, (3) employee contributions, and (4) management of the pay system. These policies are the foundation on which pay systems are built. They also serve as guidelines for managing pay in ways that accomplish the system’s objectives. Internal Alignment Internal alignment refers to comparisons among jobs or skill levels inside a single organization. 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