Airasia’s Logistic and Channel Management

As Airasia’s vision is to be the largest low cost airline in Asia, our proposal might be a useful tool for Airasia to achieve their vision. The goal of our proposal is to decrease the operational cost of Airasia to attain cost efficiencies and provided the public with a lowest cost so that â€Å"Now everyone can fly† with Airasia. Objective of this proposal is to develop e-Supply Chain Management to attain a much lower operation cost for Airasia in the coming year. In this proposal, we will discuss about; 1.Analyze of the factors contributing to enable e-SCM for Airasia, 2. Create an appropriate implementation plans to develop e-SCM, 3. Discuss the environmental factors that will affect the implementation, 4. Determine which department will e-SCM help the most, 5. Show the benefit of e-SCM to Airasia and stakeholders and 6. Suggestion for how to further improve the e-SCM. Overview of the company (Airasia, 2010) Now everyone can fly, this slogan held in every Malaysianâ €™s mind deeply. Airasia was an Asia’s leading airline with a dream of making flying possible for everyone.The vision of Airasia is to be the largest low cost airline in Asia and serving the 3 billion people who are currently underserved with poor connectivity and high fares. The mission of Airasia included; †¢ To be the best company to work for whereby employees are treated as part of a big family †¢ Create a globally recognized ASEAN brand †¢ To attain the lowest cost so that everyone can fly with Airasia †¢ Maintain the highest quality product embracing technology to reduce coast and enhance service levels There are 6 main values that Airasia focused in to attain the lowest cost.The strategies used were; ? Safety first o Partnering with GE Engine Services the world’s most renowned maintenance providers and complying with the world airline operations. o GE Engine Services began servicing jet aircraft engines over 50 years ago. o Provide large or small jet engines for commercial or military aircraft as well as engines for marine and industrial applications (Breaking Travel News, 2002). ? Hight Aircraft Utilisation o Implementing the regions fastest turnaround time at only 25 minutes, assuring lower costs and higher productivity. Low Fare, No Frills o Providing guests with the choice of customizing services without compromising on quality and services.  Example services provided food ; beverage, merchandise, excite, baggage supersize, pick a seat, premium service or corporate booking. ? Streamline Operations o Making sure the process are as simple as possible. o Example online ticket booking. ? Lean Distribution System o Offering a wide and innovative range of distribution channels to make booking and traveling easier. Strategy of distribution like call centre, sales office ; airport sales counter, authorized travel agents, mobile booking or online. ? Point to Point Network o Applying the point-to-point network keeps ope ration simple and cost low Analyze Airasia’s Annual Report According to Airasia’s Five-Year Financial Highlights from 2006 until 2009, Airasia’s revenue is increasing steadily. Unfortunately, in year 2008 is having loss around RM497 million. This is because their operating expenses (-RM3,207 million) had exceeded their revenue (RM2,955 million).From the report, year 2008 Airasia had huge amount of air craft fuel expenses (-RM1,390 million) and derivatives (-RM679 million) on operational cost compare with years 2009 –RM928 million and RM22 million. Due to the fuel expenses and derivatives, it causes Airasia making loss in year 2008 (Airasia Berhad, 2010). From the balance sheet, we can know that net current asset of year 2008 and year 2009 was increasing from RM163 million to RM511 million. It is because of non-current assets and current assets increased and current liabilities decreased.On non-current liabilities, borrowings of RM6,068 million in year 200 8 and RM7,068 million in year 2009 (Airasia Berhad, 2010). |Key Ratios (YE 31 Dec) |2008 |2009 | |Revenue growth (%) |n/a |8. 4 | |EBITDA growth (%) |n/a |86. | |Pretax margins (%) |(15. 3) |16. 8 | |Net profit margins (%) |(15. 4) |16. 3 | |Interest cover (x) |1. 6 |2. 1 | |Effective tax rate (%) |n/a |3. | |Net dividend payout (%) |n/a |0. 0 | |Debtors turnover (days) |91 |88 | |Stock turnover (days) |4 |3 | |Creditors turnover (days) |149 |127 | Adapted]From: Chew. B, 2010. Comparing with Malaysia Airlines, Malaysia Airlines have more revenue compare with Airasia but their profit after tax are around the same figure, which are RM493 million in year 2009, RM245 million in year 2008, RM853 million in year 2007, RM133 million loss in year 2006 and RM1,251 million lose in year 2005. Although Airasia revenue lower than Malaysia Airlines around RM8,442 million but Airasia can gain the profit like Malaysia Airlines. In conclusion, the strategies used by Airasia are very successful (Mala ysia Airlines, 2010).Compare Airasia with Malaysia airlines |2009 |Airasia |Malaysia Airlines |Differences in % | |Revenue |RM3,133 million |RM11,574 million |269. 42% | |Net profit after tax |RM506 million |RM493 million |-2. 57% | |Passengers carried |14,253 million |6,549 million |-54. 5% | |Fuel Expenses |RM927 million |RM3,497 million |277. 24% | |Net Current Asset |RM511 million |RM3,023 million |491. 59% | Balance Sheet Ratio for year 2009 |Ratio |Formula |Airasia |Malaysia Airlines | |Current |CA/CL |1. |0. 86 | |Quick |(Cash+AR)/CL |0. 86 |0. 74 | |Net Margin |NPAT/Sales |16. 2 |0. 04 | |Operating Margin |Operating profit/Sales |0. 15 |-0. 06 | |Return On Assets |NPAT/T. Assets |0. 04 |0. 6 | |Return On Investment |NPAT/Net Worth |0. 19 |0. 66 | The factors contributing to e- enable SCM in Airasia The invention of internet has greatly influence the traditional supply chain management in the world. Many company realize the benefits of apply IT into their supply chain managem ent. Internet has provided a great opportunity for company to share and access information faster and increase the productivity and efficiency of the supply chain performance.Other than that, e-enabled SCM lead to deduct the cost and add extra value for the company. Those enabling software like CRM, ERP and EDI which can help in make improvement on the integration with its buyers, sellers, suppliers and partners. Rapid changing of technology forcing the companies must plan to change their business strategy in order to understand consumer behavior and fulfill their needs. Due to the inefficiencies of the traditional supply chain management, many company decided to acquiring e-SCM are aim to better manage their supply chain flow to ensure it is operating smoothly.E-SCM is taking advantage in coordinate the cooperation with suppliers. E-commerce allow the seller promote and sell their products and services through the internet. Some of the buyers today prefer to search, buy, compare or book the products and services on the internet. Since the consumer behavior has changed, all of the companies are forcing to change their supply chain processes to adopt the new channel to meet the customer expectations. Thus, the supply chain needs to be different with the traditional channel.Airasia can provide customers booking flight ticket via internet (Gimenez et al. , 2003). Information sharing is a crucial part in supply chain management. Traditional supply chain management provided limited information flow among the employees, customers or the suppliers. That is higher cost and time consuming to get the information and it will cause the company can’t make a good decision. Therefore, internet provided a chance for company to share and access the real time information among its partners to ensure effective.Extranet can build a network to link the company and the partners together and granted to share and access information faster. Therefore, company can easily get the urgent information instantly in low cost. It can make a big improvement in enhancing the integration company with its suppliers. Other than that, an intranet can send and accept the documents through electronic media among the firms. In addition, internet is a high speed medium where can reach global. Internet can help the Company connect with their foreign partners in a minute for business information, discussion and proceed to procurement decision.It can know as e-procurement, example, Airasia can order the air bus spare part via internet (Gimenez et al. , 2003). Knowledge sharing, in the database management is not only offer precious information, there are also including planning, analyze the result and transfer and transform into meaningful information and share with business partners . Company can get the data with just a few clicks and help them to make a better decision for their business. That is providing big advantages to the company where is cost saving and improve the e fficiency of their business decision.Example, Airasia can collect their sales data and analyze it into meaningful information in order to respond to customer needs and demands and react quickly to the market. It can also use to forecast the company sales, so, the company can make decision to improve their sales (Gimenez et al. , 2003). One of the factors e-enabled supply chain management is it can design an effective supply chain to strive for effective collaboration and integration with suppliers and customers, increase the competitive advantages in the intense competition environment, improve the operational process, and gain a long-term benefit.Even though internet is an inexpensive and faster way to obtain the useful information to assist the company to improve the supply chain management, company has to design a good supply chain structure to make the supply chain flow more effective. The better of the supply chain design, the more benefits company can gain from it. Intense com petition today has forcing the company to do better always in order to survive in the market. Internet has offering the company a chance to design a better supply chain to enhance its supply chain performance by adding new functions to achieve the company objectives (Gimenez et al. 2003). Implementation plans to strategize an e-SCM In competitive environment today, internet technology provided strong tools to strengthen the company’s electronic supply chain management. If the company can carry out an appropriate implement planning, it would lead to obtain a competitive edge. A poor planning may cause supply chain produce the poor result like low quality, poor services and higher cost. Initially, the company must clarify the supply chain goals to indentify which goals are going to set to get best effect in the business.Competitive level, distribution, production, financial and customers needs need to be concern to assure the new supply chain able to achieve company goals and f ulfill customers’ need. Outsourcing can be more suitable because operating a new supply chain is costly. After that, conduct a supply chain readiness audit to analyze the business. To understand the existing company core and capabilities priority. How the company is going to respond with high demand, global reach? It such as an evaluation of business before a new supply chain is implementing.Next step is developing a business case, the top management should develop a business case that understands electronic supply chain can increase the performances of business and it would improve the customer satisfaction, supplier integration and cost effectiveness. To make a better business case can help in achieve company’s mission and objectives. Fourth step is establishing a supply chain coordination unit. Establish a skillful e-SCM team to implement and coordinate the supply chain.The team is to make sure the supply chain is operating under a smoothness condition, reduce the c ost, facilitate business performance and increase customer satisfaction. Training has to give out to improve the SCM team skill, knowledge and leadership (Kalakota et al, 2001). Next, begin supplier integration. Business partners are the important part in the supply chain to help the company to achieve their new business projects or objectives. Electronic supply chain will be inefficient if without any supplier support.Develop a performance score card to evaluate the performance of new supply chain. Reengineering might need when there have problems occur or something is going wrong. Penalties and performance reward may place into the measurement as incentives to drive e-SCM efficiency. The following step is always educate, educate, educate the members who are involve in the supply chain management by provide training, education, mentoring to the members to get the newest knowledge and information to perform well. At the final step, company has to learn to manage failure.Not every sy stem will always implementing smoothly, failure will lead into inefficiencies and influence the company daily operations. Thus, company must able to cope with the failure, understand the problem and learn from the failure and make improvement on it to prevent the problems occur again (Kalakota et al, 2001). Airasia is using Low Cost Carrier (LCC) business strategy to operate their business and transform supply chain management to electronic. Airsia is going to adopt several systems to support the e-SCM to operate smoothly.All of the systems are operating to achieve the business goals by cost effective of the operation (ERP and CRS) and maximize the revenue (YMS). Airasia attempts to integrate information technology with current supply chain management to carry out some planning and strategy that is implementing effectively to support and develop their business to coordinate their daily operation, integration and communication (Kho, 2005 and Wong, 2009). Advanced Planning and Schedul ing (APS) is introduced to improve the internal operational process and achieving low cost business strategy.In airline industry, complex network, huge daily operation and a lots of external factor that will influence the operational performance like bad weather. In order to be successfully implementing a good supply chain, Airasia can use APS to become a core of their supply chain to deal with the customer and supplier requirements. A series of effective functions will provide by APS to support Airasia in their daily operational activities. There are supplier portals, it will provide some useful information for Airasia to help them avoid from any system error such as order processing.APS also assist in inventory planning and maintenance management. APS is ability to integrate Airasia, its maintenance supplier, GE aviation, and other suppliers to manage the inventory such as spare part to check resource availability and place order priority to prevent out of maintenance stock and se t a maintenance schedule to ensure the aircraft is in a safety condition all the time. Route profitability analysis is conducting to set and plan an efficient route in order to save cost and increase revenue (Kho, 2005 and Wong, 2009).Computer Reservation System (CRS) is an integrated web-based inventory and reservation system including call center, airport departure control function, internet and others. Airasia is going to use e-commerce to facilitate the online reservation and purchase e-ticket process. Intermediary had eliminated in this process. Airasia will offer 24 hours per day and 7 days a week for real time transaction that enable local and global customers to book the ticket anytime. The system software will provide data in online booking and categorize stored, update automatically and help in scheduling flight activities.This is also cost effective by less depend on human resource for data entry. Therefore, Airasia can fully utilize the available of vast booking informat ion where bring customers to the website to minimize the unsold seat and maximize their sales. The comprehensive information is available by the supply chain system on the internet for customer to view, search and compare with others companies before they decide to purchase in terms of service, price or flight time.CRS has provided convenient for the company to maximize their sales to meet customers’ needs (Kho et al, 2005 and Wong, 2009). Beside that, Airasia had decided to acquire a Wireless Delivery System (WDS) to provide convenient to the customer so they able to book ticket through their mobile phone while increasing Airasia sales (Kho et al, 2005 and Wong, 2009). ERP is application software integrated with its company system that helps the company to manage the operational activities effectively and efficiency.Airasia can implement ERP system which is a system that will focus on company daily operations and help in save operational cost, maintain integrity, speed up re porting and increase efficiency of the operational performance and better manage its electronic supply chain (Kho et al, 2005 and Wong, 2009). Yield Revenue System (YMS) used to aid in understand, react and anticipated the buyer behavior to enhance the company revenue. The system can effectively result in optimize the Airasia’s flight ticket price and maximize the company expected revenue. Example, seat price is available by different level in the different time.A ticket booking at a later time may be charge a higher price than an earlier booking. Other than that, the system will help the company adjust the ticket price when there have high demand in that destination. YMS is obtaining advantages in charge a lower price to maximize the revenue and adjust the price into higher price when the peak time through the demand forecast. In this case, Airasia can fully understand their consumer behavior and implementing the effective strategy to achieve their revenue objectives (Kho et al, 2005 and Wong, 2009). ECRM is a system software use to build a long term relationship with the customers.Many companies are plan to cut customer service cost while improve customer satisfaction. ECRM is providing extra advantages compare with offline CRM. Airasia will use ECRM to manage the complaints from the customers through the call center and solve the customer problem and question by FAQs with further customer service support line on the Airasia homepage. Besides that, ECRM also provide convenience for customer to check in through the internet and mobile phone. ECRM can help the Airasia indentify the frequent customer and reward them through reward program like frequently flyer program.Email notification may be send to the customers to inform them about the promotion information (Wong, 2009). Environmental factors that may affect the implementation of e-SCM in AirAsia External factors Sociological Social environment includes the cultures, customs, mores, values and demogr aphic characteristic of the society in which an organization functions. Social processes also determine the goods and services, as well as the standards of business conduct, that a society is likely to value and accept. (Smith, 2010) In Malaysia, most of the population is educated and 65. % of Malaysians use internet (Internet World Statistic, 2010). This eases the process of implement e-SCM. When suppliers, customers and employees of Airasia are educated and able to operate a computer, it will be very easy for them to understand the concept of e-SCM, accept and use it. Therefore, the learning cost of Airasia’s e-SCM can be lower down. However, Airasia’s supplier have different values in implementing e-SCM. They may refuse to share actual data with other companies due to lack of trust (Scalet, 2001). This caused a barrier while implementing e-SCM.Political The political environment reflects the relationship between business and government, usually in the form of govern ment regulation of business (Smith, 2010). Political factors such as labour laws, tax, trade policy, and political stability defines what Airasia can and cannot do while implementing e-SCM. During year 2009, the Prime Minister, Abdullah Badawi was set to step down in March 2009. This caused political uncertainty. This issue may lead to difficulties in setting rules or changing any structure in Airasia in order to implement e-SCM.Besides, Airasia also operate in other countries, many laws will be different compare to Malaysia. So Airasia will face another issue while implement e-SCM. Economic Economic environment refers to relevant conditions that exist in the economic system in which a company operates. Those factors in economic environment are interest rates, exchange rate, economic growth, inflation rate and others (Smith, 2010). For example, the rising of oil and arousal of low-cost competitors like Firefly will affect Airasia’s operating cost.They will influence the profi ts and availability of funds and cause implication on implementation of e-SCM (Yahoo! Answer, 2010). When Airasia is lack of fund, there will also lack of employees training cost on e-SCM and implementation cost. A Thai individual holds 1%, Airasia holds 49% and Shin Corporation hold 50% of Thai Airasia. Shin Corporation was owned by previous Thailand prime minister and it has strong financial strength to support Airasia to implement technology such as e-SCM (International Transport Workers' Federation, 2007). TechnologicalTechnological environment includes human knowledge, work methods, physical equipment, electronics and telecommunication and various processing systems which used to perform business activities. (Wong, 2009) Technology nowadays helps a lot in e-SCM. The main technology that affects implementation of e-SCM is Internet. It is serving as a medium for information access, transmission and sharing among suppliers, Airasia and its customers. Apart from that, with the aids of other technologies like intranet, extranet, e-mail, online conferencing, and others, all the supply chain partners ofAirasia can easily communicate and collaborate. Speed of information flow faster through Airasia to its customers or supplier. The other technology platform is Enterprise Resource Planning System (ERP) and Electronic Data Interchange (EDI). These technologies have stimulated implementation of e-SCM. Internal factors Human Resource When Airasia implement e-SCM strategy, every process, goal or system must be carry out by employees. Thus Airasia need to provide training to its employee, development, restructure and compensate in order to support e-SCM process. However, some employees may resist to change.Airasia must be award or compensate them so that implementation goes smoothly (Lancaster, 2006). Financial Resource Financial is critical factors that affect e-SCM. Without enough funds and capital, e-SCM cannot be implementing because e-SCM needs huge fund to carry out. Although Airasia is suffering loss during year 2009, Airasia can raise its fund to implement e-SCM by selling its share or capital restructure (Whitley, 2009). Physical Resource The infrastructure needed to be carry out e-SCM are corporate portals, workflow system and tools, EDI, intranet, extranet and others groupware tools.Airasia should gets all infrastructure ready to implement e-SCM. Organizational structure A flattened organization structure can easier to accept, adapt and implement new technologies or strategies (Pearlson, 2006). However, board of directors of AirAsia is too narrow, decision making will be too shallow (Onwutalobi, 2008). When implement e-SCM, decision making need to be fast, effective and efficient. Area that e-SCM help most in Airasia E-SCM helps Airasia a lot in this airline competitive industry and one of the ost significant advantages are reduced manifest preparation time, reduced paperwork handling time, reduced time in communicating with up- and do wn-stream intermodal partners and reduced load transference times between intermodal partners One of the significant e-SCM for an aviation company is the Computer Reservation System (CRS). Online sales through this system captured more than 50 percent of Airasia’s revenue (Corporate website, 2005). The system can also detect the frequent flyers and rewards them accordingly to create higher customer retention rate and lead to a better stage of relationship marketing with the customers.The Customer Relationship Management (CRM) process provides the structure for how relationship with the customer is develop and maintained (Croxton et al. , 2001). CRM can be a system linked together with the CRS in order to obtain the customer description and reservation description to provide them with full range of customer service including the FAQ questions in it. Besides that, Distributed Database System (DDS) is also a core element in this successful Airasia in the airline industry. If Air asia tend to expand to a wider range of market share, a geographically dispersed database can be used to plan its flight schedule carefully.Another element is that Wireless Delivery System (WDS) for the ease of their customers to browse company website details and place their reservation using their mobile phone. Airasia practices online booking if the customers tend to save money for lower price when they purchase their ticket online. The complexity of managing the flexible price can be carrying out using Yield Revenue System (YRS). Airasia can price accordingly by referring to the demand of the flight and pick the best price for Airasia’s yield revenue.Demand driven resource planning and employee scheduling is crucial to the success of all aviation service providers and Advanced Planning and Scheduling (APS) can help Airasia in the dynamic airline environment. Crew scheduling, fleet management, gate and check-in desk planning and the ground crew planning is a crucial part f or the company to overcome the increasing operating costs. Benefits of e-SCM to AirAsia, suppliers, and consumers The common model of e-commerce supply chain system transaction view is shown as below; company, suppliers and consumers are all linked throughout the whole transaction.So, as Airasia applies e-SCM, besides benefit to Airasia, it also benefits to suppliers and consumers (Hultkrantz et al. , 2001). [pic] Company Airasia can use the computer network to operate its businesses as one of the e-SCM strategies. Airasia’s can introduce booking air ticket through the online website which is assisted Air Asia transformed towards a more well-established communication media which is available 24/7. As the forecast, there will about 40% total revenue can be gain via the Internet transactions.It is because of Airasia can take the advantage of B2B marketplaces to forecast the demand for their services and, using differentiation pricing strategy to attract more customers and gain more market share by implementing the Yield Revenue System (YMS). In addition, the e-CRM in e-SCM allows Airasia to provide personalized service and one-to-one relationships between merchants and consumers. The ERP system had speed up reporting and increase efficiency of the operational performance which will directly increase the satisfaction of customers towards the services quality provided by Airasia.At the end, Airasia can enhancing relationship with both existing and potential customers and also the suppliers since the communication became a straightforward task. Besides that, Airasia can cost saving through the Advanced Planning and Scheduling (APS) which improved the internal operational process and achieving low cost business strategy. The company can also saves on the cost to operating and managing the bricks and mortar outlets and able to reach national markets without any efforts on developing a physical distribution network.Then, Airasia can reduce the cost of sales com mission of the middleman, which is the travel agent. So, as a conclusion, if Airasia adopted e-SCM, the company can streamline and restructure the services provided to its customers, developing new markets, and thus creating innovative business opportunities to its customers and suppliers. Suppliers [pic] Due to the supplier’s view of e-commerce supply chain, they concern on the process of buy and fulfillment, ship and logistics and fleet management (Hultkrantz et al. , 2001).The suppliers of Airasia can strengthen their forecasting ability, meet and exceed Airasia’s demands by offering the right promotion of products and services at the right time, as well as align their production schedules based on their manufacturing capacity and inventory management is improved because of the efficient information exchange, inventory visibility and transactions through the EDI system. So, the supplier can minimize ordering, handling and other costs and avoid from the bull-whip eff ect which may cause them profit loss from the surplus of the stocks or failed to gain more profit because of the shortage of stocks.In addition, the supplier can increase its reputation by meeting the needs and demands from the customers. Consumers The customer’s view point towards the e-SCM can be represented simply, as the figure below (Hultkrantz et al. , 2001). [pic] The e-SCM delivers value across Airasia customers’ supply chain allow customers make quicker and better decisions because the information about inventory visibility and transactions.Airasia customers can compare the pricing and the quality of services provided by Airasia and the others competitors on Internet. Besides that, the e-SCM automating the e-procurement function, simplified purchasing processes which benefits Airasia in lower their transaction costs and overhead. Since the expenses or costs of Airasia reduced, they may able to lower down the pricing but maintaining the same quality of services , which is also considered as benefit to customers. Customers get the same quality of services but with a lower pay.Through Computer Reservation System (CRS), Airasia can launch the ticketless system which the customer of Airasia has the opportunity in doing the booking and purchasing process at anytime, anywhere as customer preferences. Once the customer booking completed, Airasia will provide customer with a program which include customer booking number, payment and travel details. So, the ordering and settlement process had simplified and more convenient to customers during they check in by just mentioning the booking number and must present identification card (IC) or passport of customer for identification purposes.Recommendation and improvement on e-SCM The constantly changing external environments which faced by the organization or company nowadays cause the Airasia have to always ensure that its own internal resources and capabilities are sufficient enough to meet or exceed the needs of the external environment. So, the e-SCM system that Airasia executed need to always keep up-to-date to meet the needs of the external environments. Besides that, in order to survive in the air flight services industry, Airasia also need to always undertake an analysis about their external and internal environment.The e-SCM system plays an important role in this process because the visible of information about the supplier side and customers’ side is useful in the analysis. So, e-SCM system needs to be improved by reducing the degree of error happened and increase the accuracy and reliability of the data flow within the supply chain flow. Since Airasia still receiving a lot complaint from customers on their service, such as the flight delays, or being charged for a lot of things and also customers is not allowed to change flight or get any refund from Airasia if they couldn’t make it.So, Airasia can improve the e-SCM through the Balance Score Card (BSC) whi ch helps in the improvement of the internal and external communications, and monitor the organization performance based on financial perspective, internal business process perspective, learning and growth perspective and also customer perspective. So, by measuring the quality management and customer satisfaction index, Airasia could further improve the e-SCM based on the feedbacks from the customers and the measurement of the performance. On the other hand, Airasia can also further improve the e-SCM in the collaboration area.There are several unexpected events are converging. Therefore, company can increases the number of platforms, packages and more advanced technologies to do the filtering tasks which only permit meaningful collaboration from sharing data and information, to developing customer reward programs and joint forecasts.ReferencesThe Breaking News (2002), AirAsia ; GE Engine Services Sign Major Engine Maintenance Agreement Worth Over US$20 Million, Breaking Travel News. Available from: – http://www. breakingtravelnews. com/news/article/btn40003248  [Accessed 3 July 2010] Airasia (2010).

Reading Comprehension and Mathematical Problem Solving Skills Essay

ABSTRACT This study determined the relation between reading comprehension skills and mathematical problem-solving skills of fourth year high school students of Tagaytay City Science National High School. Specifically, the study aimed to: describe the profile of the students in terms of age, gender, birth order, parents’ educational attainment, parents’ occupation, and monthly family income; determine the level of reading comprehension skills of the students; determine the level of mathematical problem-solving skills of the students; determine the significant differences in the students’ reading comprehension skills when grouped according to age, gender, birth order, parents’ educational attainment, parents’ occupation, and monthly family income; determine the significant differences in the students’ mathematical problem-solving skills when grouped according to age, gender, birth order, parents’ educational attainment, parents’ occupation , and monthly family income; and determine the significant relationship between students’ reading comprehension skills and mathematical problem-solving skills. The descriptive-correlational research design was used in this study. The respondents of the study were the 222 fourth year high school students under the general curriculum. In order to collect data and provide answers to the research hypotheses, Students’ Questionnaire, researcher-made test on mathematical problem solving, and Gates-MacGinitie Reading Test were used by the researcher in gathering data. For data analysis, the following statistical tools were used: frequency, percentage, mean, t-test, analysis of variance and Pearson Product-Moment Coefficient of Correlation. The significance of the differences and relationship were tested at 0.05 level. Based on the findings, the following conclusions were drawn: The fourth year high school students of Tagaytay City Science National High School are mostly of average age, their ages range from 15 – 16 years old. There are  more female students than male students. A big percentage of the respondents are middle born. Majority of the respondents’ parents finish high school. Majority of the respondents’ fathers and mothers are unskilled workers. Most of the respondents’ family are low income earners, the monthly family income range from P 10,000 – P 19,999. The level of reading comprehension skill of the students is â€Å"good.† The level of mathematical problem-solving skill of the students is â€Å"fair.† There are no significant differences in the students’ reading comprehension skills when grouped according to age, gender, birth order, parents’ educational attainment, and monthly family income. However, there is a significant difference between reading comprehension skills and fathers’ occupation but there is no significant difference between reading comprehension skills and mothers’ occupation. There are no significant differences in the students’ mathematical problem-solving skills when grouped according to age, gender, birth order, parents’ educational attainment, parents’ occupation, and monthly family income. Finally, there is a significant relationship between students’ reading comprehension skills and mathematical problem-solving skills. The following are hereby recommended by the researcher: Students should observe proper study habits . They should develop a study schedule to help them maximize their time for studying that could lead to improvement of their reading comprehension and mathematical problem solving skills. There is a need to assist students develop favorable attitude toward reading different reading materials that suit their interest and age. Students should constantly practice solving mathematical problems, for them to master and to improve their skill. English teachers should motivate students to engage in recreational reading to facilitate language learning. They should help them develop the attitude of learning while enjoying. They should give quarterly reading reports using books, magazines, newspapers, and other reading materials that test their level of comprehension along literal, interpretative, and critical areas. These reports can be used to evaluate the progress of reading comprehension of the students. Likewise, mathematics teachers should provide students with proper motivation related to problem solving and create a positive learning environment to improve their performance. Further, mathematics teachers should introduce varied techniques and strategies in solving word problems. During classroom  instruction, they should check the steps adapted by the students in solving mathematical problems to correct their mistakes in that instance and to enhance their performance in mathematics. Parents must see to it that their children observe proper study habits and if possible guide them in their homeworks and other class activities . They must advise and encourage their children to read different reading materials. In addition, parents must understand that their children need to be guided most especially in their weaknesses in problem solving. The administrators should continuously train teachers in reading strategies to update them on the latest trends and issues so that they can use these in teaching students on how to read effectively and meaningfully. Similarly, the administrators should provide seminars and trainings about mathematical problem solving techniques to equip their teachers with new methods in problem solving, which they can later impart to their students in solving problems systematically and analytically. Moreover, school administrators should be supportive of their teachers to help them grow professionally. They should encourage teachers to pursue graduate studies in English and mathematics. Finally, school administrators should exert efforts to conceptualize programs and activities on how reading can be involved in mathematics instruction. Curriculum makers should develop learning materials that will enhance the reading comprehension and mathematical problem solving skills of the students. They should also focus on improving the curriculum of English and mathematics. Lastly, future researchers may conduct studies of this nature to validate the results of the present study and to include other variables which were not investigated in this study such as attitude toward mathematics and English, study habits, and some teacher related factors. MATEL, PABLO B., Reading Comprehension and Mathematical Problem-Solving Skills of Fourth Year High School Students of Tagaytay City Science National High School, SY 2013 – 2014. Master’s Thesis. Master of Arts in Education major in Mathematics Cavite State University, Indang, Cavite. Octber 2013. Adviser: Dr. Constancia G. Cueno.

Ultimately fulfillment, and not pleasure, is essential to a happy life Essay

Ultimately fulfillment, and not pleasure, is essential to a happy life - Essay Example His book entitled The Art of Happiness opens with the simple statement: â€Å"I believe that the very purpose of our life is to seek happiness† (Dalai Lama and Cutler, 2009, p. 13) and he goes on to explain all of the ways that human beings can cultivate an inner state of happiness through self-discipline and an awareness of the connectedness of each human being with others and with the world. For him there is a spiritual dimension to happiness, that comes with a realization that there is more to life than just what is superficially visible. He does not think that happiness comes from pleasure of a physical kind: â€Å"Happiness that depends mainly on physical pleasure is unstable; one day it’s there and the next day it may not be† (Dalai Lama and Cutler, 2009, p. 33). A traditional Judeo-Christian perspective is found in the Old Testament in the verse â€Å"Happy is the man that findeth wisdom, and the man that getteth understanding† (Proverbs 3:18). This line of thinking reveals that it is in the process of working towards a laudable goal that people find happiness, and this rings true in modern experience too. Most people are happiest when they are lost in their work, or in a hobby, and they are proud and pleased when they can look back at their own hard won achievements. The transitory pleasures of modern life can keep us amused for short periods of time. True happiness, however, comes from the inside of a person, and develops over time as an attitude of mind. Life can be very hard, and for every living thing, death is the only certainty. This knowledge can lead to feelings of deep despair and hopelessness that no amount of pleasure can ever displace. It is only when people learn to focus on something worthwhile, and channel their energies into bettering themselves and helping their fellow citizens, that they start to fill up the empty hole of despair deep inside them. Fullfillment comes from

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How would you characterise Martin Luther Kings strategy for gaining civil rights In what ways did it differ from the approach espoused by Malcolm X or Stokely - Essay Example Being raised Christian gave King a moral and forgiving outlook on life, that later showed in his approach to civil rights. Garrow explains King stated: We must keep God in the forefront. Let us be Christian in all of our action. The protesters must not hate their white opponents, but be guided by Christian love while seeking justice with their demands. Love is one of the pinnacle parts of the Christian faith. There is another side called justice. And justice is really love in calculation. (24) Baptist believed that Jesus did for every mans sin. All that man has to do is ask for forgiveness, inviting Jesus into to his heart. Once Jesus blood covered a sinner, the sinner became perfect in Christ. If someone is perfect, no matter the color, they are equal. King felt that every sinner could be forgiven, even Ku Klux Klan members or white supremacists. This led him to be forgiving of the white oppressors. Forgiveness in the Christian religion did not mean acceptance for the Jim Crow laws in place at the time of Kings birth. Jim Crow laws did not abide by national laws. King felt â€Å"civil disobedience to local laws is civil obedience to national laws† (Garrow, 92). Although the North won the American Civil War, the South won the battle of Jim Crow laws. Jim Crow laws were laws created to keep white and black separated (Cook, 10). An example would be separate bathrooms, water facets, eating facilities, and even separate places on public transportation. King felt that Jim Crow laws were illegal. Technically he was right. The North won the war, which made federal laws superior to state laws. However, the Southerners did not acknowledge this fact. The reality was the North did not want to deal with civil rights after the American Civil War until activists like King started pressing the issue. King realized that, â€Å"that our refusal to accept jim crow in specific areas challe nges the entire social, political and economic order that

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Global Strategy and Local Needs in the Luxury Car Market Essay Example for Free

Global Strategy and Local Needs in the Luxury Car Market Essay 1 Introduction Since the 1980’s researchers have been trying to understand what globalization is and how competitive advantage can be gained out of it. This study will look at this movement with a critical eye and reflect whether or not it is sometimes better to give local needs priority in management decisions. The purpose of this study is to analyse whether the â€Å"Global strategy, but local needs† assumption leads to success. The objective is to provide scientific evidence for this strategy, analyse different organizations’ strategies and provide a possible recommendation for the best practice. Globalization is a driver of luxury 1 but it is not the best solution to apply this approach in all strategic decisions. This paper will not only look at this strategic approach in general, but will try to focus in specific on the luxury car market. The luxury segment is a fascinating subject for scientific research, because it still provides possibilities for relatively fundamental research within its niche. 2 Although there is considerable literature about specific brands, there is a lack of systematic and scholarly work that analyses the luxury car phenomenon itself. 3 The importance of this segment has also been emphasized in Sergio Marchionne’s recent speech to the shareholders (appendix 7. 2). The CEO of the Fiat S. p. a and of the Chrysler Group LLC underlined that his strategy for the future of the Group is located in the premium4 car production. 5 The motivation of this paper therefore is to analyse the challenge Maserati will have to address and to arrive to some practicable conclusions. 1 Cf. Kapferer/Bastien 2012, p. 12. 2 Cf. Heine 2012, p. 6. 3 Cf. Berger 2001, p. 160. 4. Expression intentionally quoted to illustrate a later explained statement 5 Cf. Fiat S. p. a. 2012b. Definition and terminology 1. 1 2 Methodology The findings of this project are derived from primary, secondary and tertiary sources of information. The tertiary source was mainly the catalogue of the Deutsche Nationalbibliothek in Frankfurt. Another important part of the data collection contributed the Internet. Most data has been found with the search engine google. com and scholar. google. com and the homepages of the relative brands mentioned in the project. The biggest part of the project’s information was taken out of secondary sources such as textbooks, newspapers and specific literature. Finally, the annual reports of 2011 of selected brands have been consulted. 2 Definition and terminology 2. 1 Strategy â€Å"†¦ Strategy in corporate practice is an integrated concept with the objective of ensuring long-term survival in active interaction with the competition †¦Ã¢â‚¬ 6 In today’s everyday changing business environment all companies are forced to reassess their strategies, their structures and their processes regularly. But the answers to every strategic and organizational challenge is varying among industries. 7 Therefore first a summary of different general strategic alternatives will be presented. Afterwards a detailed analysis of the characteristic strategy in the luxury car market will be developed. 2. 2 Global or Local Strategy In this chapter both terms global and local strategy should be defined. Moreover the strategic challenge of a business to decide between both strategies should be analysed. 6 Cf. Kotler/Berger/Bickhoff 2010, p. 12. 7 Cf. Bartlett/ Ghoshal 1990, p. 17. Definition and terminology 3 Businesses have been international since ancient times and at its beginnings international business had simply the form of exporting and importing. Any business that carries out some of its activities across national boundaries can be defined as an international business. 8 In the 70s and 80s keywords as standardization, rationalization and centralization marked the new tendency towards globalization. 9 Globalization is a term that emerged in the 1980s/90s10 and that has become a buzzword in the 1990s. 11 Originally globalization was only an economic phenomenon that described the integration and merger of national economies, and the development of communication and production of knowledge, transportation and migration. 12 Today the extent to which the organization’s activities are spread across geographical regions has become a major consideration in the implementation of an organizations strategy. 13 A global strategy is the tendency of a company to a consistent strategy and adaptation to local circumstances become redundant. Global organizations gain competitive advantage overcoming national and continental boundaries. Therefore it was a widely held belief that there was the risk that the globalization would overrun all regional and national differences. 14 Though today we have evidence that there is no â€Å"global village† and that regional and national differences cannot be so easily neglected. On the contrary the majority of the apparently global organizations use local differences to gain competitive advantage. 15 Therefore numerous literature and research on the counter-rotating trend to globalization, the so-called localization, can be found. Localization in general means the adaptation to or consideration of local market conditions. Most of the research concluded that the two apparently contrary concepts do not mutually exclude but depend on one another: â€Å"Globalization can mean the reinforcement of 8 Cf. Campbell/Stonehouse/Houston 2002, p. 255. 9 Cf. Bartlett/Ghoshal 1990, p. 36. 10 Cf. Lohmeier 2008, p. 9. 11 Cf. Rohm 2010, p. 4. 12 Cf. Lohmeier 2008, p. 9. 13 Cf. Campbell/Stonehouse/Houston 2002, p. 254. 14 Cf. Lohmeier 2008, p. 10 15 Cf. Lohmeier 2008, p. 58. 4 Definition and terminology or go together with localism as in ‘Think globally, act locally’†¦Ã¢â‚¬  16 . Numerous literatures even deduce a new concept called â€Å"Glocalization. † Glocal strategies are strategies that provide evidence to global and local players, to respond advantageous and purposeful to globalization. They should assist global players to localize their activities where worthwhile and show ways and means to local players to make use of the global area respectively in both cases without abandoning their global or local character. 17 2. 3 Bartlett’s and Ghoshal’s model According to Bartlett and Ghoshal there are three traditional strategic directions a company can follow. Tab. 1: The three strategic directions 18 Multinational Global International Strong local presence Cost reduction through Usage of knowledge and through respect of national centralized but worldwide competences of the HQ needs oriented activities through worldwide diffusion and adaptation 2. 4 The multinational organization The multinational organization according to Bartlett and Ghoshal is the archetype of the organization. At the beginning of the 1900th century this was the most diffused organizational model. As shown in figure 1 in the multinational organizational model the HQ is at the centre with many decentralized, interdependent and autonomous branches surrounding it. The specific needs of the local markets are encouraged and therefore they are able to react to local needs. Historically this organizational model was the one of many European companies that expanded into foreign countries. Several of these companies originally where family owned companies. Processes were based on personal relationship and 16 Cf. Pieterse 1995, p. 49 zitiert nach Lohmeier 2008,p. 53. 17 Cf. Lohmeier 2008, p. 64. 18 Cf. Bartlett/ Ghoshal 1990, p. 32. 5 Definition and terminology informal contacts rather than formal structures and systems. Therefore only elementary financial control was necessary. 19 Branch Decentralized federation: Many key assets, responsibilities and decisions are decentralized Branch Branch HQ Branch Personal control: Informal HQ – subsidiary relationship, simple financial control Branch Multinational mentality: Management considers overseas operations as portfolio of interdependant business. Branch Figure 1: Multinational organization 20 2. 4. 1 The international organization This organizational model has similarities to the multinational organization. However as shown in figure 2 the branches are more dependent on the transfer of information and knowledge from the HQ. The objective of this kind of organization is to transfer knowledge and competences in aspects such as technology or marketing to underdeveloped foreign branches. The national branches can adapt products or strategies, while the HQ determines innovation and processes. In comparison to the multinational organization model there is more systematization and control. According to Bartlett and Ghoshal the international organization model had its breakthrough in the post-war period. The international organizational model is the model for the typical American Management culture of empowerment and delegation. 19 Cf. Bartlett/Ghosal 1990, p. 73. 20 Cf. Bartlett/Ghosal 1990, p. 74. 6 Definition and terminology Branch Branch Coordinated federation: Many assets, resources, responsibilities and decisions are decentralized but controlled by HQ Branch Branch HQ International mentality: Management considers overseas operations as appendix to a central domestic corporation Branch Administrative control: formal management planningand control systems allow higher HQ-subsidiary linkage. Branch Figure 2: International organization 21 2. 4. 2 The global organization Global companies develop their products and strategies considering only one equal worldwide market. Product development, production and marketing strategies remain centralized. 22 As shown in figure 3 the most important characteristics of the classical global organization have HQs that are a centralized hub that severely controls the branches and a management-mentality that views the world as one economic entity. The main feature is the centralization of assets, resources and competences. The function of branches is reduced to sales and services. In some cases financial competitive advantage is gained outsourcing the production sites abroad. Compared to the multinational and international organizations the branches in global organizations have less power to develop or modify new products and strategies. Managers in global organization, especially those located in HQ, often are more concentrated on the global market and consider the market to be equal worldwide. They have no comprehension of the local needs because there is no exchange of information between HQ and the national branches. 23 21 Cf. Bartlett/Ghoshal 1990, p 77. 22 Cf. Bartlett/Ghosal 1990, p. 31. 23 Cf. Bartlett/Ghoshal 1990, p. 75 f. 7 Definition and terminology Internationalization pioneers like Henry Ford build up their production plant according to this model and the Japanese started their offensive in the 70s and 80s with this model. 24 Normally global organizations first where very successful in their home market and used this success then to expand internationally. 25 Branch Branch Centralized hub: Most of the strategic assets, resources, responsibilities and decisions centralized Branch HQ. Branch Operational control: Tight control of decisions, resources and information through HQ Branch Global mentality: Management considers overseas operations as channels for the supply to a unified global market Branch Figure 3: Global organization 26 2. 4. 3 The transnational strategy Bartlett and Ghoshal claim that the traditional directions do note lead to adequate results anymore. Global and international organizations look out for a centralized answer to a worldwide market opportunity. Multinational companies search local solutions. Therefore Bartlett and Ghoshal developed the assumption for a new approach to solve the challenge of increased competitive and changing environment: The transnational strategy. 27 Companies nowadays can only survive in the competitive environment if they succeed in developing simultaneously worldwide competitiveness, multinational 24 Cf. Bartlett/Ghoshal 1990, p. 75. 25 Cf. Bartlett/Ghoshal 1990, p. 31. 26 Cf. Bartlett/Ghoshal 1990, p. 77. 27 Cf. Bartlett/Ghoshal 1990, p. 33 and p. 90. Definition and terminology 8 flexibility and global learning capabilities. These are the main elements of the transnational model. 28. The transnational model is a symbiosis or rather compromise of the other three traditional strategic directions. It combines both kind of competitive advantages: Because the affiliations are seen as strategic partners they can better respond to local needs and global synergies can be positive side effects. In the transnational model local markets are respected, and the proximity to the market is mainly an instrument to react more flexibly on a global scale. 29 The distinction between multinational and transnational companies is the amount to which the HQs are directly involved in the management of the branches. While a transnational company often has a strategic centre that manages to a high degree all the global operations a multinational company does not coordinate directly its foreign activities but rather considers the branches as interdependent business. The transnational organization acknowledges that there are certain resources and competences such as finance or research and development that are better centralized in the HQ while other resources are more advantageous to be decentralized in the markets to spread the competences on a global level. 30 2. 5 The Luxury Concept and Definition. The concept of luxury is known since ancient times. Lucullus, a roman senator who was famous in the ancient Rome for his marvellous evening events and his love for beauty, delicacies and sensorial pleasures, can be considered inventor of the luxury concept. 31 Chevalier and Mazzalovo provide a definition as follows: A luxury brand is selective and exclusive and provides an additional creative and emotional value for the consumer. It is a brand that is giving the desirable attribute of being scarce, sophisticated and in good taste. It also has a slightly understated and aristocratic attribute. 32 28 Cf. Bartlett/Ghoshal 1990, p. 33. 29 Cf. Bartlett/Ghoshal 1990, p. 84 30 Cf. Bartlett/Ghoshal 1990, p. 84. 31 Cf. Heine 2012, p. 2. 32 Cf. Chevalier/Mazzalovo 2008, p. viii Definition and terminology 9 According to Kapferer and Bastien a luxury brand can be defined by six criteria:33 †¢ An extremely hedonistic experience or product †¢ The price is exceedingly higher compared to the functional value †¢ Tied to a tradition, exclusive expertise and culture ascribed to the brand †¢ Accessible only through controlled and restrained distribution †¢ Obtainable with tailored supplementary services. †¢ Indicating a social representation, making the holder or beneficiary feel special and privileged 2. 6 Luxury versus premium car market The concept of luxury is represented in numerous sectors of activities 34. In this study we will look into more details of the specifics of the automobiles luxury sector. According to Chevalier and Mazzalovo luxury automobiles are â€Å"those cars that consumer perceive as being very special and different from the others. †35 It is necessary to differentiate between the concept of luxury and the concept of premium. The term luxury vehicle suggests a vehicle with a higher quality equipment, better performance, particularly precise construction, comfort, higher design, technologically innovative, and features that transfer an image, brand, status or prestige. Often the image is strongly related to the country of origin of the product. Premium products are upper-range branded products with an increased price without the emotional characteristics like hedonism or myth. „Upper premium brands remain comparative, whereas luxury is superlative. â€Å"36 Suitable examples for this difference can be found in the car industry. While an Audi A6 or A8 are super-premium cars because of the excellent usage value they provide, an Aston Martin or a Lamborghini are luxury cars because of their rarity and the prestige of the name. 37 33 Cf. Kapferer/Bastien 2012, p. 47. 34 Sectors of activities of luxury: Ready-to-wear cloth, jewelry and watches, perfumes and cosmetics, fashion accessories, wines and spirits, automobiles, hotels, tourism and private banking. 35 Cf. Chevalier/Mazzalovo 2008, p. x. 36 Cf. Kapferer/Bastien 2012, p. 43f. ; Cf. Kapferer/Bastien 2012, p. 53. 37 Cf. Kapferer/Bastien 2012, p. 53. 10 Strategic examples One historic management error that underlines the difference between luxury and premium is the Jaguar case. When Ford acquired Jaguar in 1989 they invested a lot in technology and training of the Jaguar employees. Thanks to common platforms with Ford they tried to sell small Jaguars. But this strategy seriously damaged the image of Jaguar and loosing the feeling of exclusivity they lost the luxury status. 38 3 Strategic examples In this chapter the before described theoretic information should be put together into a strategic framework. The strategic examples that will be considered are the most successful competitors of Maserati in terms unit sales: Porsche, Audi, Mercedes and BMW (figure 4). The first step was to obtain an overview of the structure of these companies and to identify their dependencies among each other and with other organizations (appendix 7. 3). The second step was to identify certain characteristics of these organizations and to put them into a framework developed to identify their degree of globalization or localization (appendix 7. 4). Based on this information a picture of their strategic directions has been deduced (appendix 7. 5). Bentley 2,57% Audi 6,56% Maserati 1,81% Jaguar 3,06% Maserati Market 2012 Aston Martin 1,74% Ferrari 1,26% Lexus 0,09% Porsche 48,43% BMW 12,23% Mercedes-Benz 22,25% Figure 4 The Maserati market in Germany in 2012 (market shares) 38 Cf. Kapferer/Bastien 2012, p. 51. 39 Management Services Helwig Smitt GmbH, Hofgeismar. 39 Strategic examples 3. 1 11 Daimler AG Gottlieb Daimler and Carl Benz invented the automobile in 1886. 40 Today the Daimler Group integrates different car manufacturers such as Mercedes-Benz, Smart and Maybach. Cooperating with various organizations worldwide it has converted from a mainly domestically oriented exporting company to a globally operating one. The company is now well established not only in Europe but also in Brazil and Argentina and has established joint ventures also in China. 41 However for the Daimler Group â€Å"the cultural inertia has been difficult to overcome, and global pretensions and traditional German attachments form a contradictory and unstable mix. †42 Therefore it is difficult to classify the group to Bartlett and Ghoshals model. The Daimler AG is rather a combination between the multinational and the global organization. Mercedes-Benz being historically strongly connected to its German roots has a centralized HQ, but at the same time its business units have been made self-responsible profit centres and procurement of materials is globally coordinated for each group of materials. Furthermore this has been intensified through local settlement of direct production, more consultancies and engineering in the branches, and also some development tasks located outside Germany. 43. Daimler is relocating its production sites into emerging markets, as for example the recently opened site in Hungary. This trend can be underlined by its decreasing production figures in Europe. They are currently reducing their production in Sindelfingen. 44 3. 2 BMW AG The BMW group may be the most German focused of the three companies. It is globalized in its objectives rather than in its activities. 45 Approximately 60% of the production of BMW is still located in Germany (figure 5). However BMW is one of 40 Cf. Daimler AG 2012, p. 4. 41 Cf. Lane 2001, p. 84. 42 Cf. Lane 2001, p. 85 43 Cf. Lane 2011, p. 84f. 44 Cf. Berens 2012, p. 17 45 Cf. Lane 2011, p. 86. 12 Strategic examples the most respected brands in the world. The explanations for BMW’s success are a strong brand character, a stable, family shareholding and a very German business philosophy. 46 It can be deduced that having local roots increases the perceived value of BMW. Producing nearly all its automobiles in Germany customers perceive BMW as an authentic product of German culture. BMW follows the same strategy of keeping the Mini production in England. 47 South Africa, 3,06% China, 5,65% Austria, 5,91% CKD, 2,16% UK, 11,23% US, 15,88% Germany, 56,11% Figure 5: Vehicle production of the BMW Group in the world in 2011 48 Therefore BMW can be classified an international organization according to Bartlett and Ghoshal’s model. BMW’s key competences are centralized but many other competences are decentralized. Thus BMW efficaciously implements the strategy of local assembling and local purchasing in countries with high customs duties on imports such as Russia, Thailand or India. However, under the terms of the distinction between luxury and premium products, the cars assembled in Thailand would not longer be defined as luxury products. They do serve to initiate customers into the brand, who then should develop the desire to purchase a ‘real’ BMW ‘made in Germany’. 49 BMW’s Management Meeting Place is a good example for the acquisition of knowledge in the HQ and then transferring it to the branches. First this discussion platform has been started in Germany and then it was transferred to locations abroad. The fact that this strategy works, and that behind BMW probably stands a 46 Cf. Kapferer/Bastien 2012, p. 67. 47 Cf. Kapferer/Bastien 2012, p. 78. 48 Cf. BMW AG 2012, p. 28. 49 Cf. Kapferer/Bastien 2012, p. 78. 13 Strategic examples strong team is underlined by the fact that BMW has been rewarded being â€Å"The World’s Most Attractive Employer† by a study conduced lately. In fact the employee attrition ratio at BMW has decreased continuously in the last 3 years (figure 6). 5,85 percentage of workforce 6,00 4,59 5,00 4,00 2,74 2,66 2,16 3,00 2,00 1,00 0,00 2007 2008 2009 2010 2011. Figure 6: Employee attrition ratio at BMW AG 3. 3 50 Volkswagen AG The Volkswagen Group maybe is the most advanced example of a conglomerate of successful car manufacturers. Among all the subsidiary brands the most significant ones are Volkswagen AG, Audi AG and Porsche AG, but there are also Bentley, Lamborghini, Seat and Skoda (appendix 7. 3). In fact Porsche owns 32,5% of the Volkswagen Group shares. Succeeding in managing a portfolio of so dissimilar organizations under one umbrella certainly makes the Volkswagen Group to a transnational organization according to Bartlett and Ghoshal. The cooperation in-between the brands of the Volkswagen Group are very well developed. One successful example of this approach is the common hybrid drive used in the Porsche Panamera, Cayenne and VW Touareg 51 . In addition the Volkswagen group has only little external cooperation mainly in the area of researching. The key competences remain inside the group. Becoming an integrated automotive industry is part of the group’s â€Å"Strategy 2018†. However, every single brand has its specific targets. Volkswagen’s target is to 50 Cf. BMW AG 2012, p. 39. 51 Cf. Porsche AG 2012, p. 67. The Maserati case 14 become the global market leader by 201852. This underlines the global factor. On the other side Porsche’s target is to become â€Å"the leader of exclusive sports cars manufacturers†53. Audi finally has the target to become the â€Å"premium brand that delights customers worldwide† 54 . Therefore the group’s values and capabilities remain inside the group and with a broad portfolio of interdependent and specialized brands completely different target groups can be addressed. The Volkswagen Group leads the global tendencies of the considered companies. But the core strategic functions (e. g. RD and design) remain mainly German. However the Volkswagen Group also recognizes the importance of knowing the local sources and therefore has implemented the C3-Sourcing program. Becoming technical, organizational and social laboratories foreign branches contribute to the integration of the whole group’s worldwide activities. Hence some Audi models that have the same platform as Volkswagen models are now produced in Volkswagen factories in China. This local adaptation is the key of success for Audi’s sales in China, where the top members of the communist party cannot own a car unless it is made in China, but at the same time it forces the brand to give up their luxury strategy and replace it with a premium one. 4 The Maserati case 4. 1 Introduction to Maserati The Italian sports cars producer with the trident on the logo has been founded as Societa Anonima Officine Alfieri Maserati on December 1st 1914 in Bologna. Maserati was originally founded as a family business, but in 1937 it was sold to the Orsi family. In 1968 it was sold to Citroen and finally became part of the Fiat Group in 1993. 55 Thanks to his big sister Ferrari, Maserati has been reconstructed and from 2006 stands alone now in the structure of the Fiat S. p. a. (see figure 7). Today Maserati’s headquarter is based in Modena and it has two production sites in the north of Italy. Furthermore Maserati is divided in regions (Europe, Asia Pacific, 52 Cf. Volkswagen AG 2012, p. 233. 53 Cf. Porsche AG 2012, p. 14. 54 Cf. Audi AG 2012, p . 131. 55 Cf. Wikipedia 2012a. 15 The Maserati case. America and Middle East) with national branches in each separate country (e. g. France, Germany, United Kingdom). Maserati is currently becoming more and more significant for the rest of the Fiat Group. The first strategic milestone of the so-called â€Å"2010-2014 plan† was the integration of the Chrysler Group in June 2011. Figure 8 shows the increase of 30% of the workforce through this merger, mainly in North America. * including 58,5% Chrysler Group LLC Maserati (100%) Fiat Group Automobiles* (100%) AUTOMOBILES Fiat S. p. a. Ferrari (90%) Fiat Powertrain (100%) Magneti Marelli (100%). COMPONENTS PRODUCTION SYSTEMS Teksid (84,8%) Comau (100%) Figure 7: Structure of the Fiat S. p. a. Workforce 80 62,583 63,214 60 40 2011 2010 60,336 44,668 24,616 23,596 20 56 39,498 5,579 0 5,838 Italy Europe (excl. Italy) NAFTA Mercosur 4,894 other regions Figure 8: Increase of the workforce in the Fiat Group through the integration of Chrysler in 2011 56 Cf. Fiat S. p. a. 2011, p. 11. 57 Cf. Fiat S. p. a. 2012c, p. 30. 57 The Maserati case 16 The second milestone was the plan presented in February 2011 in which â‚ ¬ 500 million were invested for the relaunch a production site58. In this new pIant two new models will be produced: The new Maserati Quattroporte by the end of 2012 and the Maserati Ghibli in the second half of the year 2013. 59 Thereby Maserati plans to increase its sales: While in 2011 Maserati sold 6,159 vehicles worldwide, in 2013 20,000 units are planed and by 2015 a growth up until to 50,000 vehicles per year is projected. 60 The Maserati S. p. a. can be classified as a global organization. They concentrate their decision and strategy making in the HQ in Italy and product development, production and marketing strategies remain centralized. The function of the branches is reduced to the implementation and realization of sales, services and marketing activities. The reason is linked to the strong connection with the domestic country and the patriarchal organizational culture that has developed over the years. One cultural example for this approach is that usually in the branches employees refer to the HQ as â€Å"the factory†. And while until today Maserati’s production sites are located just in the domestic market, by the use of a common platform and production site with the Jeep Grand Cherokee in the United States for the new SUV model, Maserati will enter also in the global environment. 4. 2 Maserati’s strength 4. 2. 1 The cooperation with the Fiat Group Being part of the Fiat Group is strength and weakness at the same time for Maserati. Through the cooperation with the other brands of the group, Maserati can benefit from economies of scale and scope. E. g. particular engines for Maserati are developed and produced in the production site of Ferrari. Another example is the collaboration with Jeep that will allow the new Maserati Levante to share the expertise of Jeep in building SUVs. 61 Moreover the fact that the production of this new Model will be relocated to the United States will finally transform Maserati from a purely domestic manufacturer to a global player. 58 Officine Automobilitische Grugliasco. 59 Cf. Fiat S. p. a. 2012c, p. 34. 60 Cf. Wehner 2012. 61 Cf. Baedecker 2012. The Maserati case 17 4. 2. 2 The luxury image Maserati as a brand itself and the Maserati products are stereotypes of luxury. Maserati is like none of its competitors a unique iconic and superlative brand that stands for an extravagant Italian lifestyle and sportiness. It profits from its long-time racing experience and expertise in building extremely performing engines. Additionally some parts are tailor made and its products are positioned in an upmarket pricing class that does not correlate with the functional value they provide. Moreover until today the units sold are rather restricted and therefore it is still a rarity to see a Maserati on the road. Thus possessing a Maserati is to a high degree socially representative and makes the owner feel special and privileged. Maserati is a myth and continuous to benefit from this legend. 4. 2. 3 Driving performance Another very strong characteristic of Maserati is its driving performance. Driving a Maserati is an overwhelming driving experience from the very first moment you switch on the engine. The expertise in building extremely performing engines is definitely a strength that should not be underestimated. „Hearing a Maseratis V-8 engine scream on the way to its 7200-rpm redline is an experience gear heads will cherish. â€Å"62 4. 2. 4 The people that work for Maserati The people that work for Maserati are fundamental assets. A mixture of experienced and long-established employees on the one side and on the other side young, motivated and talented staff are the most important ingredient for the team that is able to face the current challenges. Maserati’s employees identify with the brand to a high level and therefore live for the brand. E. g. in the HQs in Modena are hanging poster with the slogan â€Å"I am Maserati†. 62 Cf. Floraday 2011. The Maserati case 4. 3 18 Maserati’s weaknesses 4. 3. 1 The image of the Fiat Group As mentioned above, being connected to mass-market brands like Fiat and Chrylser could affect Maserati’s luxury status. This is primarily related to the image of Fiat’s quality standards. The fact that some components are commonly introduced in both, Maserati and Fiat, could severely damage Maserati’s reputation. 4. 3. 2 Progress and technology Except for its engines, Maserati is not using the most advanced technology in his cars until now. Competition from other car manufacturers is very strong in this context (e. g. Porsche or BMW). Therefore this is a threat especially in those markets where technology and innovation are very important factors in the consumer buying behaviour process (e. g. Russia or Germany). Moreover while other manufacturers have already developed new propulsive forces e. g. the new Daimler electric fleet63, Maserati continued only the evolution of traditional fuel and diesel engines. As the petrol price rises also this threat is increasing. And depending on the trend of the environmental regulations in Europe and in the rest of the world, this lack of development could become an increasing challenge for the next future of Maserati. 4. 3. 3 Dealer network Another threat is the necessity to improve and expand the dealer network. There is a clear need to increase the distribution capillarity by appointing additional dealers. Moreover, there is also a need to transform the existing dealers bringing them to focus their activities and organizations on the brand. Dedicated sales, after-sales and marketing forces will be key to this transformation. E. g. most of the Maserati dealers sell also Ferraris and should adapt their staff with personnel dedicated exclusively towards Maserati. 63 Cf. Daimler AG 2012, p. 41. The Maserati case 4. 4 19 Maserati’s opportunities 4. 4. 1 Industrial opportunities With its current models range (Quattroporte, Gran Cabrio and Gran Turismo) Maserati is represented in the core segments.

Alcohol Summary Essay Example for Free

Alcohol Summary Essay In 2001 spirit makers ended a long standing volunteer policy against aggressive alcohol advertising (Steiner and Steiner, 2009). Since that time, there has been an unprecedented shift toward increased alcoholic advertisements in an effort to increase market share and raise profits. This shift brings into light the challenge alcoholic companies face in balancing their fiduciary duties to their shareholders and their corporate and social responsibility to society. This report focuses on the issues surrounding Anheuser Busch’s Spykes beverage and the corporate and social issues similarly faced by other alcoholic beverage companies. Introduction There is growing public pressure for alcoholic beverage companies to meet their social and ethical duties to balance efforts to increase profits to their shareholders whilst protecting society from the harmful effects of excessive alcohol consumption. Anheuser Busch (AB) is one of the largest alcoholic beverage companies in the world. In 2005 AB manufactured an alcoholic beverage called Spykes It is a spirit based beverage that was intended to target their 21-30 year old legal age drinkers. Following a successful soft launch, AB was hopeful that Spykes would help increase market share and profits. Unfortunately, growing public pressure forced AB to stop selling Spykes (Steiner and Steiner, 2009). This report looks at specific issues surrounding Spykes and its potential harm to society, considers AB’s ethical duties to society, discusses the affect of alcoholic advertising in society and addresses potential reforms to help ensure alcoholic beverage companies fulfil their ethical duties to protect society of undue harm. Is Spykes Bad? Spykes could be considered bad in the sense that it was likely targeted at underage drinkers. It is well accepted that alcoholic beverages are no ordinary commodity (Babor et al, 2003) and Spykes could be classified as part of the Alcopops group of beverages which are primarily consumed by underage or young drinkers. These Alcopops negatively affect the health and well being of young people (Robinson and Kenyon, 2009). Accordingly, Spykes may be considered bad for the health and well being of underage drinkers and society in general. The World Health Organisation believes that alcohol consumption is one of the leading causes of death among young people (World Health Organisation, 2002). AB elected to stop selling Spykes in response to negative public pressure. This negative pressure primarily came from Center for Science in the Public Interest who believed Spykes was being marketed and consumed by underage drinkers. This belief was formed on the basis that AB used strategic marketing incorporating the latest technology to produce interactive arenas with impressive graphics, eye catching animation and a fancy website (Riley, 2005). This online content is generally appealing to a young audience. As Riley (2005) stated that young people are the biggest users of the internet and of advanced mobile phone technology. The alcohol industry has been quick to grasp the resulting marketing opportunities. Accordingly, stopping the sale of Spykes was the right thing to do in the context of reducing harm to underage drinkers as well as right thing to do in the context of protecting AB’s brand and public relations efforts as a socially responsible corporation. Anheuser Busch’s Ethical Duties. Ethics refers to the concept of judgment; what is right and wrong, moral and immoral in society. It is ethically accepted that organisations run to make a profit (Steiner and Steiner 2009). Alcoholic beverage companies would argue that advertising is a promotional activity used to enhance their profit, not to attract under age drinkers to consume alcohol. Anderson (2009) argued that alcohol advertising influences young people to consume more alcohol, especially teenagers due to the sexually arousing images in the advertisements. Jones (2005) acknowledged that alcoholic beverage companies who don’t provide correct information or hide information in their advertisements are acting unethically. From society’s perspective, any activities conducted by the alcohol beverage companies to remove alcohol related problems like violence, decreased morality and intoxication related problems like drinking driving are seldom advertised and marketed. In this sense, society is only seeing advertisements related to increased consumption leading to increased profits. Accordingly alcohol industries fail to fulfill their ethical duty to be informative and truthful in their advertising efforts. At present, alcohol beverage companies create a brand image by sponsoring sports and cultural activities that attract drinkers, first starting as a social drinker and then becoming regular drinkers (Munro De Wever, 2008). The current alcohol advertising regulatory system in Australia should aim to minimize exposure and appeal to children (VAADA, 2010). In Australia, advertising activities are regulated by legislation and a code of practice such as the Advertiser Code of Ethics and Alcoholic Beverages Advertising Code (ABAC). This code is based on a voluntary system of self-regulation which is funded and administered by the alcohol beverage companies. Currently there are no penalties for non-compliance (Jones, Hall Munro 2008). Additionally, the organisation is partly funded by alcoholic beverage companies. This presents a conflict of interest as in most instances, their fiduciary duties are act in the best interests of their shareholders and not necessarily society at large. In order to offset this conflict of interest, it is necessary for an Australian Federal regulatory body to be established to independently control alcohol advertising in society in the hopes of minimising the attraction of alcohol to underage drinkers. Misleading Advertisements Studies have proved that there is a strong relationship between alcohol advertising and consumption rates among under age drinkers (Snyder, Milici, Slater, Sun and Strizhakova, 2006; Collins, Ellickson, McCaffrey and Hambarsoomians, 2007). In addition, evidence suggests that alcohol ads influence youth perceptions of drinking. Some advertisements contain misleading messages that drinking alcohol will make consumers more sociable and outgoing; help them have a great time; help them feel more confident and less nervous; succeed with the opposite sex or it would make them feel more attractive (Jones and Gregory, 2007). These messages are highly attractive to today’s youth. Some ads portray drinking as distinctive and prestigious. These ads suggest that by drinking their product you will enjoy the finer things in life. As an example some beer ads depict attractive people on yachts, in luxury restaurants or luxury establishments (Fig 1, 2 and 3). Other ads propagate that drinking increases your status and differentiates you from others (Fig 4). Whilst other ads imply that sports and alcohol go together (Fig 5, 6). These ads are commonly aired during sporting events and through alcoholic beverage company sponsorship of such events. Wealth, happiness and sex tied to drinking are also common themes portrayed in ads (Fig 7 and 8). In some measure, each of these images appeal to under age drinkers and the investment in advertisements is on the rise. Table 1 shows the substantial investment by alcoholic companies in magazines alone. According to The Center on Alcohol, alcohol companies spent $2billion on alcoholic advertisement in magazines alone between 2001 and 2006 (The center on alcohol marketing and youth, 2008). In Australia during 2008, alcoholic beverage companies spent in $109million on advertisements (Nielsen Australia, 2008). Many of these messages are appealing to under age drinkers. Accordingly, alcohol companies should attempt to market their products in such a way that ensures their ads do not convey misleading messages. One way is to focus the ad on the product rather than the misleading images of wealth, sex and status. In addition, local governments should also promote responsible drinking and spread awareness in society adopting similar advertisements strategies. Regulating Alcohol Advertising The need for further regulation depends upon weather it can be proven that advertising alcohol increases consumption. In 2006 Teinowitz (2006) undertook a study of randomly sampled 15-26 year olds. The study found they drank more after seeing alcohol ads, and that each additional ad viewed increased the number of drinks consumed by 1%. The study also established that in markets with more alcohol ads, spending on alcohol was up over markets with fewer ads (Teinowitz, 2006). Accordingly, there is further need for regulation of alcoholic advertising. Further regulation could be in the form of the creation of a regulator body that enforced restrictions against alcoholic beverage companies adopting marketing strategies that primarily appeal to young persons. In AB’s case, they admittedly targeted young people with a brightly colored web site allowing visitors to download music mixes, ring tones, screen savers, and instant messaging icons (Steiner Steiner, 2009). These activities catered around youth culture. Regulators could determine that such marketing strategies, directed at young persons, could constitute advertisements that appeal to under age drinkers and therefore ban such ads. This ban could extend to bans on advertisements in public places and bans against alcoholic companies sponsoring public or sporting events. In order to determine if the suggested restrictions above meet The Central Hudson guidelines, a four part test may be applied as follows (Steiner and Steiner, 2009):- (a) the ad in question should promote a lawful product: (b) the government interest in restricting the particular commercial speech must be substantial; (c) the restriction must directly further the interest of the government; and (d) the restriction should not be more extensive than is necessary to achieve the government’s purpose. As outlined above, young people are influenced by alcohol advertising (Teinowitz, 2006). This interest is therefore substantial and the suggested bans will further protect the interest of the government. Although the suggested restriction may seem excessive, industries need to appreciate that a â€Å"business firm is more likely to gain public approval and social legitimacy if it adheres to basic ethical principles and society’s laws† (Post, Lawrence and Weber, 2002). Accordingly, the suggested restriction would meet the purposes of the Central Hudson guidelines. Conclusion Anheuser Busch is a good example of an alcohol beverage company that struggled to find a balance between increasing market share and profit whilst fulfilling its ethical duty to be a socially responsible corporation. As a result of this case, the information and ideas presented in this report suggests there is much needed reform and the establishment of a regulatory body to deal with alcohol advertisements. This need is driven by the significant interest in protecting young people from harm. Alcohol beverage companies and government should work together and do all they can to reduce harm to young people by restricting marketing and advertisements that appeal to young people. * Appendix A * Table 1 * Appendix B * Figures Fig 1: Skyy Blue, Entertainment Weekly, Apr 11, 2003| Fig 2 : Glenfiddich Scotch Whisky, Sports Illustrated, Nov 15, 2004, Nov 29, 2004, Feb 14, 2005| Fig3 : Captain Morgan Parrot Bay, Stuff, Aug 2002| Fig 4 : http://www. encyclopedia. com/doc/1P2-18802608. html, www. whiskyfun. com/archivemay05-2. html| Fig 5: www. funkydragon. org/en/fe/page. asp? n1=950n2=2207| Fig 6: http://www. swimmingworldmagazine. com/media/Michelob_Ad4. JPG| Fig 7 : Molson Canadian, FHM, Aug 2005| Fig 8 : http://katiehann. wordpress. com/2008/11/06/advertising-alcohol/| References Babor, T, Caetano, B, Casswell, S, Edwards, G, Giesbrecht, P, Graham, K, Grube, J, Grveneward, P, Hill, L, Holder, G, Homel, R, Osterberg, E, Rehm, J, Room, R and Rossow, I (eds), 2003, Alcohol: No Ordinary Commodit, Research and Public Policy, Oxford University Press, Oxford. Brian, J. (2000) Youth, Alcohol, and the Emergence of the Post-modern Alcohol Order, Occasional Paper No. 1 New Series, Institute of Alcohol Studies, London. Riley, L. (2005) ‘Drinking It In: Finding of the Valencia Meeting on Marketing and Promotion of Alcohol to Young People’ in G Marcus J O’Connor (eds), Corporate Social responsibility and Alcohol: The Need and Potential for Partnership, Guilford Press, Hoboken. Robertson, S and Kenyon, A, 2009, Ethics in the Alcohol Industry, Palgrave Macmillan, New York. World Health Organisation (WHO), (2002) The World Health Report 2002: Reducing risk, promoting healthy life, Geneva. Anderson, P. (2009) ‘Is it time to ban alcohol advertising? ’, Clinical Medicine, 9, 2 April 2009: 121-124 Jones, S. C. , Hall, D. Munro, G. (2008) ‘How effective is the revised regulatory code for alcohol advertising in Australia? ’, Drug and Alcohol Review, 27: 29-38 Munro, G. and De Wever, J. (2008) ‘Culture clash: alcohol marketing and public health aspirations’, Drug and Alcohol Review, 27(2): 204-211 Steiner, J. F, Steiner, G. A. (2009) ‘Business, Government, and Society’ McGraw-Hill Irwin, 12ED Sandra C. Jones (2005) ‘Beer, Boats and Breasts: Responses to a controversial alcohol advertising campaign’ ANZMAC Conference, University of Western Australia, P 77-81 Victorian Alcohol and Drug Association, 2010, Position Paper: Alcohol advertising, marketing and promotion, viewed 16 June 2010, http://www. vaada. org. au/resources/items/314236-upload-00001.pdf. Post. J. E. , Lawrence. A. T. and Weber. J. , (2002) Business Society: Corporate Strategy, Public Policy, Ethics, Tenth Edition, Irwin McGraw-Hill, Boston. Teinowitz. I. (2006) Do booze ads drive youth to drink? Advertising Age (Midwest Region Edition) Chicago. Vol 77, Iss 35, p8. viewed 24/06/10 http://0-proquest. umi. com. library. newcastle. edu. au/pqdweb? index=28did=1118136211SrchMode=1sid=1Fmt=3VInst=PRODVType=PQDRQT=309VName=PQDTS=1277385716clientId=29744.

Impact Of Vastu Shastra On Architecture

Impact Of Vastu Shastra On Architecture Shelter is one of the basic needs for Human beings. People spend much of their time in their homes. Therefore comfort and environmental conditions are important aspects of a house. However in contemporary India this ancient practice is being termed as myth or occult by the majority .Still this practise proves to be extremely popular with contemporary clients, who insist on their house being built and designed as per vastu shastra. This thesis deals with the relevance of Vastu Shastras fundamental rules of architecture which are based on now proven scientific facts to todays architectural and interior design practices. The aim is to prove that Vastu Shastra has a scientific background with a practical application and is not just a superstition .The purpose is to clear the fears in the mind of the people about the misconception of Vastu Shastra and its tenets, the fear created by consultants by threats of destruction, death, disease and miserable life Therefore, knowing and applying the rules of Vastu Shastra would be extremely beneficial for any modern day Architect and/or Interior Designer in India. The thesis contains four chapters. The first chapter introduces Vastu Shastra and its rules governed by the various elements of nature .This chapter discusses the history and the present of Vastu shastra in India. The second chapter discusses the occult aspect of Vastu .It is an attempt to reason out why people have an impression of Vastu as a superstition and to enlighten and encourage the reader to study Vastu Sastra with an open mind and demystify its occult garb. The third chapter puts forward various issues dealing with environmental relevance of Vastu Shastras rules and their scientific backgrounds. It reveals two important aspects of the relevance of solar energy and geomagnetic energy with Vastu .The first part displays the vector analysis of the varying directional solar energy field as implored on stationary geomagnetic flux. The second part explains the correlation between the movement of the sub atomic paticles and the electromagnetic flux. The fourth chapter discusses an ideal Vastu layout and also presents a case study of a contemporary project with the application of vastu rules and brief statements of the inmates confirming their wellness in a Vastu based residence. Chapter 1.Vastu Shastra in India Vastu Shastra is an ancient building science that governed the Indian architecture in the vedic times. Vastu means building and Shastra means the science so in essence it is the building science. It explains the basis of creating spaces in respect to its surrounding. Vastu Shastra originated around 3000 BC. It was first mentioned in the ancient Hindu scriptures like Rig Veda, Mahabharata etc. In primitive India, education, medication, horoscopy, astrophysics, occultism, metaphysics and religiousness lived in complaisant proximity, their borders superimposing and one enhancing the other. The rules of Vaastu Shastra and environmental reflections in residential buildings were established considering the cosmic influence of the Sun, wind direction, magnetic field of the earth and the impact of cosmos on the Earth. House building design, including its internal and external environment, has customarily been the duty of the architects. Vastu Shastra scriptures were scribed in the olden days when architecture was essentially for the rulers, the nobles and for the divine structures. The fundamental architectural Rules namely climate, orientations, functions, planning, etc are now being overlooked by the architects and designers. Especially in India, the very fact of buying and owning a house is considered as a sign of high class belonging to community and status in the society. Considering environmental factors in buildings is as old as the architecture, the Vaastu and the Vedic Era . With the guidelines of Vastu Shastra the architects can design buildings in such a way that it will bring good health, wealth and peace to the inmates. Man builds the city so that the city shall build its dwellers. () The upcoming occupation of architecture has outcast the Vaastu Vidya or the customary Indian wisdom of architecture. Vaastu Shastra is as aged as knowledge itself, but the practise of the Vaastu Consultants is a fairly new and modified, it addresses only a part of this science. It is time Vaastu Shastra is made free of its mysterious guise and exhibited as a rational and judicious branch of knowledge. Vaastu Shastra is futhermore distinguished by the Vaastu Pundits'(experts) and is termed as The Edifice Science (implication of the rules of this science while designing a building will assuredly bring peace and prosperity to its occupiers) Vastu Shastra has been acknowledged as a science derived from the study of nature and the supernatural by the prehistoric Aryan sages. Vastu Shastra takes into account the influences of the sun, ts light and heat.It considers the impacts of earths electromagnetic field, bio-chemical effects in a human body, in order to lead a healthy and prosperous life. Advanced study in neuro-science has proved that the Sun, the Moon, Planets which are the Cosmic counter-parts, have a one-to-one relevance to the various fragments of the human brain . Hence, the Vedic formula for the orientation of the dwelling towards the east to achieve the benefits of the morning sun and a perfect house ,a square with a cental open space to avoid the scorching afternoon sun. Various ailments like insomnia,cerebral palsy,hypertension,etc experienced healing in th past 15 years with the help of Environmental energy much before it was acclaimed by the scholars of today through the study of Matsya, Mansaraand many more epics and were recognised and acknowledged as science for example the military science Dhanur-Vidya The profession of the designer or the architect is absolutely mistaken with the role of the astrologer. Traditionally the Indian Architecture was acknowledged as unique and was not subject to be analysed by the western examples. The fundamental rules of Vastu Shastra are based on two important aspects 1.The five natural elements sky, air, fire, water and earth and 2. The eight cardinal directions North, South, East ,West, North East ,North West, South East, South West. Fundamental concepts of Vastu Shastra The whole universe is made up of the five basic elements sky, air, fire, water and earth. According to Vastu Shastra a perfect balance of these elements can enhance the living conditions. 1.The Five elements of the Nature The science of Vastu Shastra considers the world to be comprised of five basic elements termed as Panch Mahabhoota Vastu Pundits (experts) believed Presence of Life on earth is a result of the balance of these five elements which are present on Earth.which is now proven by the modern world scientists.( BBC,OPEN SCIENCE.,2010 Final Frontier[online].The open university.Available from:http://www.open2.net/science/finalfrontier/life/why.ht[Accessed 01 August 2010) Following are the five basic elements of the nature. BHUMI (EARTH)- The position of Earth ,is third in order from the sun. Presence of electromagnetism makes it a large magnet in the space with the North Pole and the South Pole as centers of attraction.Every living and Non living organism on Earth is influenced by its magnetic field and Gravitational pull. JALA (Water)-Water is in a liquid form and is represented by rain,ocean,sea, and river.It forms a portion of every flora and fauna.Haemoglobin in combination with oxygen forms blood which runs in our bodies. VAYU (Air)- Air is considered as the foundation of life and is a supreme source of life. The comfort value of human beings is directly dependant on the balanced humidity, temperature, pressure, flow and the composition of the air and its contents. AGNI (Fire) -Fire is symbolised by light and heat which forms an indispensable part of day and night ,climatic conditions,radioactivity,avidity,energy and vigor AKASHA (Space) The space or the sky shelters all the elements of nature.It is the primary conductor of all the sources of energy for example light, sound,social energies namely emotional and psychological and cognitive energies namely intuition and intellect. There is an unseen relationship amongst all the above five elements. Thus various human conditions can be improved by considering the effectiveness of these five basic natural forces while designing the buildings.The role of Vastu Shastra is to combine these elements of nature and balance them with the man and the matter. Taking advantage of the gifts bestowed by the nature to make a pleasant living and working conditions thereby promoting spiritual well-being and enhancing healthand wealth leading to prosperity and happy living The eight cardinal directions Vastu takes into consideration the eight possible directions after analysing and studying the four coordinal and angular directions. coordinal directions- North, South, East and West angular directions North East, NorthWest, SouthEast, SouthWest In Vastu studies these directions are established with the help of a tool called the Vastu compass which is a magnetic compass. The building site is first analysed with this tool and later inscribed on the layout to start the process of designing taking in consideration the Vastu principles. Vastu affirms that it helps one to tune with nature and derive its free benefits by honouring the five basic elements and the eight cardinal directions. Chapter 2: The Occult aspect of Vastu There are three important factors that influence the misconception of Vastu Shastra. 1.Personal Motives of the consultants Human mind has always been intrigued by the Occult and the supernatural. In a lot of cases the beliefs and faiths of common people have been wrongly used and abused. It is therefore important to understand when and where should one draw the line .This fear of being a victim to such immoral practices by some Vastu consultants who do not understand the subject but scare people for their advantage has created an unbelief of Vastu Shastra in India. The purpose of this chapter is to clear the fears in the mind of the people about the misconception of Vastushastra and its tenets, the fear created by consultants by threats of destruction, death, disease and miserable life. The truth is that the original Vastu script is lost and all modern available text are only compilation, this has made Vastu a victim of unscrupulous interpretation. 2.Mythological Stories Moreover the terminology used by the ancient scholars while explaining the scientific laws of Vastu Shastra also gaves rise to the superstitious aspect of its understanding. In the ancient times, the Vedas ,or the knowledge, was limited to a particular cast of people, which is why it was difficult for a common person to understand the principles of this science, if explained in a scientific way. The wise ones used the terminology which was easy for the common man to understand so for example ,when the scholars had to say that by constructing a window in a particular direction, one can make the most of the early morning sun rays, they would rather say that by placing the window in a particular direction the deity of that direction will bless them with good health and prosperity. Consequently Vastu in India is treated as a religious duty more than an art of construction, which leads to the misunderstanding of its concepts. The problem starts when Vastu Shastra is mixed up with religious rituals.The wisemen of yesteryears infused religion in Vastu so that people will implement it and practise it in the fear of the supernatural but today it has been been misjudged and wrongly accused in the name of religion and occultism. Indian mythology tells stories of the deity of Foundation Vastu Purusha. The stories in the Vedas also have a important role to play in the misconception of Vastu Shastra.There is an Fascinating story about the Vastu Purushain the Matsya Purana. According to the Vedas , Vaastu Purusha is omnipresent in all the plot irrelevant to its size. It lays on the plot with its head down and his body folded in a peculiar fashion in order to cover the length and the width of the plot. During his battle with the demons,Lord shiva got tired and started sweating too much and out of his drops of sweat a cruel looking hungry man was born who began to make penance to appease the deity.Lord shiva finally was pleased with him and granted him his wish to be the strongest and largest being on Earth.He then stood between the Earth and the heavens.Terrified by this devotee the deities and the demons together pinned him down to the earth. Pitying his state Lord Shiva blessed him and made him the God of Vastu and called him the Vastu Purusha. Since then it is believed that the being is present in every plot with the deities and the demons acquiring and ruling different positions on his body . People listen and believe in such stories and overlook the science of Vastu .They do not probe into the details of Vastu science and term it as a myth. Moreover since the knowledge of Vastu was passed down from generation to generation, it has been modified and more and more stories are weaved around it to make it sound more mythological. However ancient Indian scholars were great mathematicians and also had the knowledge of geology this is shown in the next chapter , which explains the rational and practical aspect of Vastu. 3.Contemporary Phase of Vastu in India Today new flats and apartments in newly constructed buildings are rejected if they are not built according to the Vastu concepts. Infact if your building is designed with the help of a Vastu Consultant then it becomes a USP to sell the Flats in certain parts of India! Amusingly some buyers come with a Vastu Consultant to check if it suits their personal needs before making the decision of buying the house of their dreams. This forces the builders to employ Vastu consultants without checking the depth of your knowledge and use them as an added tag to sell their Flats who inturn mislead the customers into buying the flats. Chapter 3 Environmental relevance and scientific approach to Vastu. In this chapter I will try to delineate the traditional narrations in terms of basic laws, logic and approach of particle physics, biochemistry and energy dynamics. For correlating the significance of directions and forces in Vastu the following topics are very significant: flow charachteristics of solar energy, geomagnetic, flux, thermal variations. Part 1.Solar radiation and its effects Whenever a structure is created it is exposed to the effects of the suns radiations. In tropical countries the south side suffers harsh heat while the north side remains in the shadow area this results in the formation of thermocouple in the space and around the house. In the tropical countries South, South East and Southwest suffer scorching heat while the North .North east and Northwest remain in the cool shadow section. It can be summarised that disturbance is created due to the high imbalance in the natural order of the geometric flux lines, (flux is defined as the amount of electromagnetic energy that flows through a unit area per unit time) forming nodes at the intersection of the flux lines.These nodes are points of distorted energy potential.Such dislocations trap the sub atomic particles travelling along the flux lines.These particles start resonating under specific conditions and off hazardous micro level radiation. These emissions have a tendency of working against the exi stence of life forms. Vastu-purush-mandal represents this phenomenon as Yama'(Lord of Death). The thermal imbalance is the main cause in creating obstacles in smooth energy flow through and around the building. The comprehensive remedial measures available in vastu shastra try to equalise the thermal difference and provide harmonious and blissful conditions for the dweller. The wise men of the past understood this and tried to derive a solution to offset the disturbance in the south direction by the following measures. 1. Thick heavy wall on the south side 2. Blocking of the openings in the south side 3. Avoiding any slopes towards the south 4.Orienting the house in such a manner that more open spaces are available in the North and East directions 5. By Planting some trees in the South for availing of humid atmosphere. 7.Raising of plinth and compound height in the south direction. If adhered to these rules one can try to create equalise the thermal differentials and create harmonious and balanced living conditions within the structure. Part 2.Directions and Deities The four main directions namely North, South, East and West represent streams of positive and negative energies .These directions act as either the source or the sink for energies. Hence the orientation and alignment of these forces are prearranged in their zones of impact. Whereas the sub directions vis-a-vis North East, South East, North West and South West represent zones of confluence of two different (positive and negative)energy streams which are at right angles to each other. Any disturbance in the flow of these energies triggers turbulence in the flow of the energy which is aligned to the primary direction. The Vastu Pundits combined the positive north and east directions with the negative south and West to determine the effects of the sub . These directions were then associated with positions of the deities depending on the results of the effects of the energies. North East + + residence of God North west + desirable direction SouthEast + Not desirable direction South West residence of Demon Part 3.Scientific Approach to Vastu. Below we will examine several examples which strongly stand for the fact that Vastu Shastra is based on solid scientific evidence and can be beneficial to the human race. The following Vastu Shastra rules can be easily misunderstood without a rational explanation. Rule 1.Each direction has a Presiding deity .Since Wealth God rules the North and the Sun God Aditya rules East direction, the window openings of the house and also the placement of the water tank should be in the North East direction to welcome the lord, who will then be pleased and will bless you with the healthy and prosperous life The scientific explanation to the above statement is as follows. The sun rises in the East and hence the suns rays emit more light and less heat .Sun rays in the morning are a rich source of vitaminD, which are A vital component in formation of healthy bone . Water is disinfected by UV rays, as the genetic material is altered in bacteria, viruses, and protozoa, which destroys the harmful microorganisms example E. Coli.(Hwaa irfan,2001). If UV exposure is dozed carefully, it has protective effects against cancer (Severn,2001 p.1). Various diseases are cured using the UV radiations, for example rickets, psoriasis, eczema and jaundice. So when one has openings in their house towards the East direction, it allows the early morning sun rays to enter the house and these are the ultra violet rays which when penetrate in the house and bestow their benefits keeping the inmates healthy and fit. A healthy and fit person can think and work more efficiently leading to a higher earning and a prosperous life. Now if the openings are created in the opposite direction, then it could be detrimental to the health, as the afternoon rays are the infra red rays, which are strong and harmful. Rule 2.The beds should be placed in such a way so as the head of the person should be in the south direction. As the deity of death resides in the south, so one should not face this direction while sleeping, as it invites death. The explanation to the above statement can be found in the earth magnetism. The earths magnetic field runs from South Pole to north pole ,so if you sleep in the same fashion then you are aligned with the magnetic flow .Now studies show that Human head and north are both positive poles (Ritu 1999)due to which they repel each other hence it is favourable to sleep with the head in the south for a sound sleep. Sleep disorder leads to a lot of health problems. This clearly proves that by adhering to the Vastu principles, one can make the most out of the natures gifts to human kind. Chapter 4.Contemporary Indian Architecture and Design Part 1.Ideal Vastu House In India a home is not just a shelter for human beings,it is called as Manushyalayawhich means human temple.As per Vastu both house and temple are sacred spaces so a house should be designed with the same concept as the temple. A house design with an open courtyard system was a national pattern of India before the introduction of the western concepts. The arrangement of the built spaces is the basis of creating a spiritual environment needed for the well being and prosperity. Figure shows an ideal layout of a perfectly square building with a superimposed modular Vastu grid of 9 x 9 forming 81 squares meant for a family. The centre space Brahmasthan is supposed to be the nuclear energy field which should be unbuilt and kept open to the sky to connect with the outer space Akasha. The central courtyard is not for the living purpose it can be used for cultural and religious rituals. The next row of squares adjacent to the centre space are to be used for a walkway and the corner squares are to used for the specific rooms. Following are the directions with the deity that presides them and the specific rooms to be built respectively. Direction Deity presiding the direction Suggested rooms North East Dharma(God of righteousness) Prayer room North Kubera (God of wealth) Living room North West Vayu (God of wind) Guest Bedroom,Toilet East Indra (God of Gods) Bathroom West Varuna (God of water) Childrens bedroom South Yama (God of Death) Store room South East Agni (God of Fire) Kitchen and dining room South West Niruthi (Goddess of demons) Master bedroom Part 2.Case study of a contemporary Vastu House Vastu House By Khosla Associates in Bangalore, India 24 July 2010, 09:18:05 | [emailprotected] (Aji Avarachan) The space planning in this house was designed in harmony with the Vastu orientation and placement concept called Vastu Purusha Mandala .To design within a dictated predetermined rigid locations specified as per Vastu yet to arrive at a visually stunning and aesthetic architecture was the biggest challenge of this project. Rising lazily from the North East which was the lowest point to South East which was the highest point of the house,it was built on soft split levels. The trees in the open courtyard are beautifully weaved in its linear horizontal and cantilevered roof .The massive stretch of glass blur the spatial boundaries between enclosed space of the house and the open space of the garden As one strolls down the open living spaces one can experience a sense of infinity, These spaces are divided with sliding bifold doors and certain spaces do not have any barrier at all. https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEj5ZUCgPdNffeQ12_zqpl5Zt4XE1n0OeM5oqn-CisTbVzZnLJjFLhPjh5Ob98YzvBNdodEPwdiVLsNGehZNPuwQQtHAhX2o9t2qNxhsgDzxAT0WSZv-rD1I4Xzi0ZvLvwWQ7LRuFuNNT9U/s400/Vastu-House-Exterior-Garden.jpg https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEh-kUgklfK8W8ju00rcfKPq296YqCnl2w-0xLszWbJfTHujUqV7SqD66mBWN_g_I9zOJK06nIvtx-DC_vBslg_qx-PKqjSeFFDgJ2io58DrXvdyDDlwYI6vJHUmCTGcELZBbcxzbLDwPrI/s400/Vastu-House-Exterior-Lighting.jpg All the main areas were positioned as per Vastu Shastra. The Master bedroom is located in the Earth Zone(SW),the location of the kitchen is in the fire zone(SE)and in the zone of water and air(N and NE) was placed the swimming pool.The main door was in the North East and the Childrens bedroom was in the West.Even the the position the staircase, the orientation of the bed, study table and wardrobe and position in the bathroom lavatories were designed in accordance of Vastu principles and the flow of the energy. https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjqlo3ygocMPvL91TlBz-KZZWlBaOs9bIeLSGWsauNG1ZdcTi7gPBZp_x0txy2GyE8c80SIRQhV_ycMqy1p1ISw38hzms5JYHL5eD_1LVRrldklY0iN64HOB8lnQXKIg0syeJdTjj0fcf0/s400/Vastu-House-Exterior-Porch.jpg https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjEHqGaFAgIx6Kj1Ghql_T1KQiPpmnYahm9rbYhDH5do4KY57c1ZKJOAnEim4Ujrmrb45oFUO_95pMidjzUfjVku5o3_t3FC3Tb-9mmQ7JqprikPA31gtbvK4QDPiMmk-q6YRoMEGjhwMA/s400/Vastu-House-Exterior-Swimming-Pool.jpg The location of this house is strategically placed near a busy street,a small inhouse office for the Master of the house is positioned near the main road.The entrance to the office is covered by the canopy of some old trees one makes a way paving through them. These trees act as a visual barrier to the rushing traffic on the main road. https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEijkg3o4ZVswUA5uDBV_C9-7PWXaiIZWz7XtpPOPRq05ckgE4sQq_oxDhfXTluEP6_dQ0EByrd-B3yVKO_eqOY8cTxlLscI0hDEsZJEM7qUlHjiFp_xi23snmBhG-MReozjfzTIFAyEO3A/s400/Vastu-House-Interior-Bathroom.jpg https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEhwhOQDTGBMH-QHLL7LHG1mXjtlbaZkoEVCqotByqGxKXNducpMfE-xe4tv5d1upmEgVNCmXCA9BONI4kfmgw8ycztJgD58GVrJeAPArdLCxgscL7kPwsX389_SPiA_E-jVMKt5hXt1J3o/s400/Vastu-House-Interior-Dining-Table.jpg The black steps which are carved from a local granite leads one from the spacious living room into the courtyard which is open to sky ,perched in the centre are some ornamental trees .The roof is cladded with local manglore tiles. The support for the roof are hand carved stone columns which are innovative and functional and carry the load of the roof through the diagonal steel struts. Taking advantage of the beautiful climate the dining table is placed in a semi-outdoor space https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEhSrEYQ0Y4cXnQs45jLkVws_PNDri93W1oEzf5I8lzTu2EpWFY5ecXzwT2Hsf7CI_ZQGPnUMQcT2qiIlKETpS8loCCMRZUUO7_BZL7obAkLqMblbMRwy419rMeCkfG-qamn_IAWW9AwFiE/s400/Vastu-House-Interior-Livingroom.jpg The first floor which is accessed through a wooden staircase has a large siiting area with a fitness center. The bathroom has huge glass windows with lots of natural light leading to a massive walk in closet. There is an interesting amalgamation of luxury and Vastu exposed concrete ceiling with rough stone steps and court gravel with polished concrete floors contrast well with fine teak furniture, itlaian marble and silk and satin furnishings. The park looks interesting with the lap pool on side and on the other side a large rough cut log forming an outdoor dining table to dine under the shades of the giant banyan tree! This is a classic example to show that a house built with Vastu rules does not restrict the creativity of a designer instead presents a challenge to achieve the a spiritual atmosphere within a concrete beauty! Conclusion To sum up the argument of this dissertation, Vastushastra has fascinated some and irritated others but it has intrigued everybodyArchitect Bharat Gandhi. The first chapter explains the the laws of Indian architecture and clarifies its fundamental concepts.The second chapter explains the misconception of terming Vastu an occult by rational and scientific method.The third chapter throws light on the metaphysical aspect of Vastu Shastra The fourth chapter explains an ideal Vastu layout with the help of a case study. The building science has its presence all over the world in different forms and they all have their own principles.From Vitruvius theory to feng shui to Vastu shastra all the sciences from different part of the world but have the same message.The main purpose of building science is to lay down some guidelines for the architects to design building in harmony with the nature and taking advantage of the prevailing natural gifts of sunlight ,wind, cosmic energy to make a habitat which is beneficial to the inmates and make their life happy and prosperous.