Acquiring and Using Funds to Maximize Value Essay

Review Questions 1. What is the key goal that guides the decisions of financial managers? What challenges do financial managers face when they try to find the best sources and uses of funds to meet this goal? The financial mangers goal is acquisition, financing, and management of assets. The challenges are investment, financing, and asset management decisions. 2. List the four basic types of financial ratios used to measure a company’s performance, give an example of each type of ratio and explain its significance. Liquidity, Solvency, Profitability, and Efficiency are the basic types of financial ratios. The liquidity ratio is the ratio of current assets to current liabilities. Profitability ratios indicate management’s ability to convert sales dollars into profits and cash flow. Solvency ratios indicate financial stability because they measure a company’s debt relative to its assets and equity. Two common efficiency ratios are inventory turnover and receivables turnover. Business manager needs to determine what the financial health of the firm, he would use liquidity ratio. A business needs to figure out how to pay off the debt to the bank, they would use solvency ratio. A company makes paper plates; they need to know how much profit they can make. They would use profitability ratio. For example, if the bank cost totaled $5,000,000 and its revenues totaled $10,000,000, then using the formula above, we can calculate that bank’s efficiency ratio is $5,000,000 / $10,000,000 = 50%. This means that it costs the bank $0.50 to generate $1 of revenue. This is an example of efficiency ratio. 3. What are the key questions financial planning must answer? What role does the budgeted income statement and budgeted balance sheet play in finding answers to these questions? What are your long term goals for the business? What are the most significant risks you are facing? How have you mitigated these risks? How do you expect your market to evolve over the years to come? Those are the four questions. They provide the answers to these questions. It is a plan to predict and show what can happen in time, it is a prediction for theses questions. 4. What is the purpose of a cash budget? How can this tool help firms with rapidly increasing sales? Cash budgets are often used to assess whether the entity has sufficient cash to fulfill regular operations. They can use it to figure out where money needs to go or where they need to gain money. It helps financial managers determine when the firm is likely to need additional funds to meet short term cash shortages, and when surpluses of cash will be available to pay off loans or to invest in other assets. 5. Name and describe 4 commonly used sources of short-term financing. Trade credit, advances from customers, commercial banks loans, and financial institutions are types of short-term financing. Trade credit is a loan in the form of goods. An advance from customers is the reputed business houses receive a part of the price or payment from the buyers before the supply of goods. The finance institutions can help the business by providing short term funds. 6. What is equity financing and what are its major sources? What advantages and disadvantages of are associated with equity financing? Equity financing is the sale of an ownership interest to raise funds for business purposes. Personal savings, life insurance policies, home equity loans, and venture capital are major sources of equity financing. The advantages are it doesn’t have to be repaid. They share the liabilities of company with the investors. The disadvantages are you have to share some of the ownership, and you have to also share your profits. 7. What is financial leverage? How, and under what conditions, can financial leverage benefit a company? How, and under what conditions, can it harm a  company? Financial leverage is the use of borrowed money to increase production volume, and sales and earnings. The use of financial leverage also has value when the assets that are purchased with the debt capital earn more than the cost of the debt that was used to finance them. If a company’s variable costs are higher than its fixed costs, the company is said to be using less operating leverage. 8. Is it possible for a firm to have too much money? Explain. What role does cash equivalents play in a financial manager’s strategy to manage cash balances? Yes because it means there can be problems in the future. They get taxed more and they don’t know what to invest the money in. They use it to show the company’s strengths and weakness. The can use it to make balance sheet, cash flow statement, and income statement. 9. Why is the $1,000 you receive today worth more than $1,000 you receive next year? What concept does this illustrate? Why is this concept particularly important when firms evaluate capital budgeting proposals? It is worth more this year rather than next year because if you receive it this year and you decide to invest in it you will gain interest on the thousand dollars you received this year. It illustrates the concept of interest. It is important for firms because it benefits them in terms of long term investment. 10. What is the net present value (NPV) of a long-term investment project? Describe how managers use NPVs when evaluating capital budget proposals. The NPV of an investment proposal is found by adding the present values of all of its estimated future cash flows and subtracting the initial cost of the investment from the sum. The managers use NVP’s when evaluating capital budgeting by most likely approving a positive NPV because this means the present value of the expected cash flows from the project is greater than the cost of the project. And a negative NPV means that the present value of  the expected future cash flows from the project is less than the cost of the investment. Application Questions 1. Your company has been struggling financially for quite some time now. You have a chance of making a profit this quarter, which is sure to bolster your stock’s sagging price. But it depends on your using a low cost waste disposal practice. The disposal practice is legal but you’ve also seen some studies indicating that it is likely to harm the environment. What would you decide to do and why? 2. Choose a company and obtain a copy of its most recent annual report. (In most cases, you can access annual reports simply by clicking on the link for investors, usually found on the company’s home page. You can also try the IRIN Annual Report Resource Center at www.irin.com, or Annual Reports.com at http://www.annualreports.com.) Using the financial statements, calculate three of the ratios described in this chapter. What conclusions can you draw from these ratios about the company’s financial strengths and weaknesses? 3. Your small company has $25,000 in surplus cash right now. You don’t want to commit these funds to any long-term investments because you know of some expenses coming up in about 8 months that will require the use of this cash. But you would like to find some safe, liquid interest-earning investments where you could park your cash until it is needed. You’ve decided that T-bills and money market mutual funds are your best options, but you want to find out more about both. Use the Internet to do some research about these cash equivalents, and then answer the questions below. How do you purchase T-bills? If you want to invest in T-bills, what is the minimum amount you can invest? Can you sell these bills before they mature? How do you receive the interest on T-bills? What is the interest rate earned on the most recent T-bills? How do you purchase money market mutual funds? How do these funds differ from money market accounts? What are the different types of money funds? Are  there any drawbacks to investing in these funds? Investigate two specific money market mutual funds. What interest rate does each currently offer is the minimum required investment for each? Based on your research, how much of the $25,000 would you invest in T-bills and how much in money market mutual funds? Why? 4. Suppose that soon after earning your bachelor’s degree you are accepted into an MBA program at a prestigious university. It is an intensive program that would require you to be a full-time student for about eighteen months. What are the major financial costs and benefits of enrolling in this program? (Hint: be sure to consider not just the out-of-pocket costs, but also any other financial sacrifices you might have to make if you became a full- time student.) Describe how you could evaluate whether enrolling in this program is a good financial decision. (Hint: Keep in mind that the benefits of your education will be in the form of higher cash flows over your entire career.) 5. Visit the sites of at LendingClub.com and Prosper.com to find out more about peer-to-peer (P2P) lending. How do these sites match small lenders and borrowers? How are the sites similar, and how do they differ? Do some additional research to find out what others are saying about the pros and cons of these sites. Would you be willing to participate in this type of arrangement as a borrower? Would you participate as a lender? Why or why not? Team Project Select 4 or 5 companies in the same basic market or industry, and print their most recent financial statements before class. Break the class into small groups, give each group the financial statements for one of the firms and have them work together to compute basic financial ratios for that firm. (The formulas for several common ratios are given in Exhibit 9.1. If you have a large class you can assign the same company to more than one group  and have the groups compute different ratios.) Then have each group report their results. Compare the ratios reported by each group. In cases where ratios differ significantly among the firms, discuss the implications of these differences. Case Connections Avoiding a Cash Crash Your company’s sales are strong and have been growing rapidly, and your recent income statements show that you’ve earned a solid profit each of the past three years. But despite this good news your firm has faced a series of cash flow problems in recent years. On several occasions you’ve had to scramble to find cash to pay your bills. You feel like you’ve been pushing your luck and you realize unless you make some changes in how you manage your cash and other current assets your problems are likely to continue. In fact, you’ve already identified three major concerns. You believe that once these concerns are addressed you will have gone a long way to reducing the possibility of a real cash crisis. Your first challenge is to find some way to get a better handle on how your cash flows are likely to vary over the year. In the past you’ve just made â€Å"seat of the pants† estimates about the amount of cash you’ll receive each month and the payments you’ll have to make. These estimates haven’t always been accurate, which is a key reason you’ve had to scramble for funds. You want to develop a more rigorous way to predict when you’ll have shortages of cash so that you’ll have more time to make adjustments or find additional sources of funds. A second problem you have concerns your credit customers. You know that offering credit to customers is a necessity; a â€Å"cash only† policy would likely cause many of your customers to take their business elsewhere. But during the recent recession many of your customers began paying late—and some didn’t pay at all. The slow payments clearly contributed to your cash flow problems. You wonder if there are some ways you could still offer credit while doing a better job of collecting payments in a timely fashion. Finally, even though cash is tight in some months, you know that there are other months when your business generates substantial cash surpluses. You’ve been reluctant to invest these surpluses in the past because, with all of the cash flow problems and uncertainties you’ve faced, you didn’t want to tie up funds. But now you are beginning to realize that such a policy has an â€Å"opportunity cost.† You wonder whether there are some safe, liquid assets where you could temporarily invest your excess cash. You Decide: How is it possible for a profitable and rapidly growing company like yours to experience cash flow problems? What can you do to improve its forecast of cash shortages and surpluses? How can your firm deal with its credit customers? What trade-offs are involved if you make changes in your credit policies? Is there any other way you could turn your credit sales into cash more rapidly? What is the â€Å"opportunity cost† of holding cash? What are some short-term investments that would be good choices when your firm has temporary surpluses of cash? Describe these investments and explain why they are good places to temporarily â€Å"park† your cash. Source: â€Å"What Are Cash Equivalents?† Wise Geek website: http://www.wisegeek.com/what-are-cash-equivalents.htm; â€Å"Cash and Cash Equivalents,† Wikinvest website: http://www.wikinvest.com/metric/Cash_And_Cash_Equivalents; â€Å"Cash Budget,† Investopedia website: http://www.investopedia.com/terms/c/cashbudget.asp#axzz1VEzc8Z9U; Cash Budgets/Cash Budgeting,† Accounting for Management website: http://www.accountingformanagement.com/cash_budget.htm; â€Å"Credit Policy,† Entrepreneur.com website: http://www.entrepreneur.com/encyclopedia/term/82124.html; â€Å"How to Create a Smart Credit Policy,† Inc. magazine website: http://www.inc.com/magazine/20090301/how-to-create-a-smart-credit-policy.html

Literature of the Great Depression: Let Us Now Praise Famous Men, the Graphes of Wrath and Tobacco Road

Literature of the Great Depression: A Survey The Great Depression, beginning in 1929 and continuing throughout the next decade, was a time of extreme economic decline, devastating people of nearly every social class, race, age, and geographic region. Millions of unemployed Americans everywhere suffered the burdens of poverty, homelessness, and crime.While vast numbers of citizens lined up in long bread lines, waiting for hours for the small amount of free food offered by government relief agencies; many others, outraged by their living conditions, took to the streets to protest, sometimes violently, demanding that the government take immediate action to alleviate their suffering. It is these images of such widespread trouble, distress, and social and political upheaval, that sparked the attention of literary writers everywhere. As literary writers assessed these new situations brought on by the Great Depression, one group in particular, the South, piqued the interests of many writers .Economic as well as environmental factors, such as drought and the Dust Bowl, adversely affected the South's economic dependence on agriculture; forcing many farmers into poverty, and driving thousands from their homes elsewhere in search of better opportunities. It is these immense economic adversities as well as vast human suffering experienced by the South that drew interest from many literary writers, making the South the subject of many famous and important works of literature, and thereby securing for the Southern regions an important historic niche in the history of the Great Depression in America.By examining the literary depictions of Southern life during the Great Depression, of works such as The Grapes of Wrath, Let Us Now Praise Famous Men, and Tobacco Road, we gain essential insights into the cultures, lifestyles, and sentiments of those Americans hardest hit by the Great Depression; farmers and sharecroppers in the American south. Among those works of literature depic ting the Great Depression is Let Us Now Praise Famous Men, written by James Agee with photography by Walker Evans.Written at the height of the Great Depression in 1936 as an assignment for Fortune magazine, and later published in 1941 as a novel, this lengthy four hundred page text is a work of non-fiction that sets out to document the often harsh conditions of white Southern sharecroppers in rural Alabama by spending time with and even lodging with three actual sharecropping families known in the novel as: the Gudgers, the Ricketts, and the Woods for a period of several weeks. In Let Us Now Praise Famous Men, passages of extraordinary description and poetic beauty describe the various settings in which the novel takes place.Agee describes in great detail the homes of the farmers, the work they do, how the people looked, what they ate, how they spoke, their possessions and the surrounding land in order to paint an accurate picture of the living conditions as well as the plight of th e sharecroppers. As Humphries points out, although Agee urges his reader not to view the novel as â€Å"high art† Agee's ability to convey beauty even in those things not typically viewed as beautiful makes the artistic value of Let Us Now Praise Famous Men quite clear.Equally as powerful as the elaborate visual images Agee so skillfully conjures within the reader and the poetic beauty of these images, is the appeal to sensation Agee conveys in his description. Agee in seeking to fully and accurately convey the experiences of Southern sharecroppers, utilizes sensation to attempt to make the reader feel what it is like to be a sharecropper, the physical pain caused by bending of the back, the sensations of cramping in the hand, and the feel of sweat dripping down the body all combine to allow the reader to feel what it is like to be a sharecropper (Quinn).It is through these depictions of sensations that Agee hoped to make the sharecroppers â€Å"so real to you who read of it , that it will stand and stay in you as the deepest and most iron anguish and guilt of your existence that you are what you are, and that she is what she is, and that you cannot for one moment exchange places with her† (Praise 321).In addition to the artful skill with which Agee so vividly depicts his novel, another notable aspect of Let Us Now Praise Famous Men is the unconventionality and experimentation through which Agee, with the help of his partner Evans, crafts the novel. The reader is confronted with this unconventionality upon opening the book, in which the presentation of the scores of photographs taken by Evans appear before any other words in the text, even before the table of contents and copyright information.Additionally, none of the pictures provide any sort of captions, a fact that could be best attributed to Evans' preference for presenting his images without the accompaniment of words (Jackson). In keeping with the lack of traditionalism of Let Us Now Praise Famous Men, Agee casts himself as a character in the novel in which, at parts, he interacts with and reacts to the other characters in the novel. The significance of this is that it provides the reader with insight into the author's thoughts and feelings about the events in the novel.However, this fact along with Agee's Southern ancestry has caused Let Us Now Praise Famous Men to be criticized as being too preoccupied with Agee's personal introspection than with creating a more meaningful depiction of the lives of his subjects (Humphries). Furthermore, in his literary criticism of Let Us Now Praise Famous Men, Coogle contrasts Agee's and Evans' work with that of Jacob Riis' work, How the Other Half Lives in order to demonstrate both Agee's and Evans' intentional preservation of human dignity as well as the rejection of more traditional worldviews, namely Victorianism (Coogle).Coogle's summation of Let Us Now Praise Famous Men is that, â€Å"with its concern for respecting human di gnity and its view of the world as complex and confusing, serves as a striking contrast to earlier notions. Agee and Evans reject any vision of the world as clearly understandable and ordered,† While Riis' Victorian sentiments simplify the human experience and presents his impoverished subjects as inferior, Agee and Evans actively avoid such degradation of their subjects and acknowledge the complexity of life.This new approach to journalism and depicting of social issues coupled with the intentional preservation of human dignity further demonstrates the unconventionality of Let Us Now Praise Famous Men and reflects the surge of new and innovative ideas that the Great Depression spurred. No better example of the Great Depression's call for innovative and experimental ideas is one that has been frequently cited by scholars, and that is the parallel between the innovative economic policies of Roosevelt's New Deal with that of the unconventional approach to the making of Let Us No w Praise Famous Men.Austgen makes the assertion that, â€Å"As Roosevelt recognized that traditional plans for economic recovery could not end the Depression, so Agee and Evans knew that traditional methods of photography and journalism would not work to convey accurately the hard and simple lives of the tenant farmers. † Furthermore, as Evans and Agee seek to preserve the dignity of its subject, so too does Roosevelt's economics (Austgen).In conclusion, while Agee's poetic, and often excruciatingly descriptive journalistic reportage coupled with Evans' contribution of a slew of candid photographs work together to create an accurate depiction of the impoverished Southern farmer's experience during the Great Depression on the surface, it is the the radical experimentation of Let Us Now Praise Famous Men, as well as Agee's and Evans' attention to human dignity, that illuminates the new and innovative ideas that times of social upheaval and economic hardship such as the Great De pression call for.Like Let Us Now Praise Famous Men, another work of literature depicting farm life during the Great Depression is John Steinbeck's American classic The Grapes of Wrath. Published in 1939, The Grapes of Wrath tells the story of the fictional Joad family, who after losing their Oklahoma farm due to economic hardship and the Dust Bowl, embark on a trek westward to California, hoping to find work and economic stability, but only find continued hardship and despair.After losing two family members to death, characters Granma and Granpa Joad, and two more family members, Noah the oldest Joad son and Connie the pregnant Rose of Sharon's husband, decide to leave the family; the rest of the family, however discouraged, continue on their journey to California. After their arrival in California, the Joads endure exploitation by the powerful upper-class employers, horrible living conditions, as well as police brutality.In response to the migrant laborers lack of power and rights , as well as their absurdly low wages, the laborers, including the preacher Jim Casey, unionize in order to fight back against the exploitation of their corrupt employers. Through his depiction of the unionization of exploited workers, Steinbeck advocates for worker's unions and the need for collective action among the masses. Furthermore, by emphasizing the exploitation of the lower classes, as well as the human suffering caused by the powerful and corrupt upper-class employers, Steinbeck's firm stance against the power of big-business is lucid (Hendrick).Steinbeck's further asserts his political ideas by depicting the Joads as having an extended concept of family. Throughout the novel, various instances arise in which the concept of family extends beyond the traditional conjugal unit, â€Å"to include members related by plight as well as by blood† (Hinton). This is first evidenced in the opening chapters of the novel, as the Joads prepare to embark on their journey westward , they allow the preacher Jim Casey to join them on their journey to California, accepting them as one of their own.Ma Joad's attempt to help starving children in the migrant camp, even as her own children do not have enough to eat further depicts the Joads extended concept of family as well as the altruism displayed by the Joad family. It is this extension of the traditional familial structure that conveys Steinbeck's Socialist viewpoints and his emphasis on the altruism and goodness of the Joads that seem to convey the message that during times of immense suffering and social upheaval people must come together to help one another.Perhaps however, the most notable depiction of the altruism and goodwill of the Joad family occurs at the end of the novel by none other than Rose of Sharon, the Joad family's eldest daughter, a character up until this point plays a relatively secondary role in the novel. After the Joad family suffers yet another tragedy, when Rose of Sharon gives birth t o a stillborn baby, the family, devastated by their loss come across a dying elderly stranger.In an act of extreme kindness, Rose of Sharon offers her breast milk to the man in order to save his life. Moreover, Steinbeck emphasis the humanity and compassion of the Joads in order to provide a stark contrast to the cold and unfeeling upper-class employers that exploit the migrant workers in order to both invoke sympathy in the reader for the plight of the workers as well as to further argue against big-business (Hinton). Finally, The Grapes of Wrath, as a renowned work of literature, fosters a prevalent image of the Southern farmer.For those with even the vaguest knowledge of this important historical era, the Great Depression conjures up images of impoverished farmers, driven from their homes, stoic-faced and desperate, in search of better opportunities and a future for themselves and their families. Although The Grapes of Wrath provides a fictional account of one sharecropping famil y, and while it can be argued that Steinbeck creates a rather dramatized depiction of the sharecroppers, the story Steinbeck tells was one that was true for many.The Great Depression did indeed drive thousands of sharecroppers from their lands, many of which may have been subjected to some of the same horrors the Joads endured. In conclusion, The Grapes of Wrath is valuable for its image of Southern farmers that has become the poster image for the Great Depression, and still remains as such even today. In stark contrast to both Agee's Let Us Now Praise Famous Men and Steinbeck's The Grapes of Wrath, is Elskine Caldwell's Tobacco Road.While both Let Us Now Praise Famous Men and The Grapes of Wrath work actively to maintain the dignity of its subjects, Tobacco Road instead provides a much more negative image of the novel's characters. Caldwell's fictional Lester family like the focus of both Let Us Now Praise Famous Men and The Grapes of Wrath are a family of Southern farmers enduring the intense suffering wrought by hunger and extreme poverty in the midst of the Great Depression.Whereas Agee presents a dignified image of his subjects, and Steinbeck emphasis the altruism and goodness of the Joad family despite their conditions, Caldwell seems to reduce his characters to less than human. Driven by base instincts the Lester family seem to epitomize vulgarity, violence, obscenity and general indecency. It is in this way that Caldwell depicts the darker side of poverty. In conclusion, by examining the authors intent of renowned works of literature depicting life during the Great Depression we gain essential insights into the social realities of Southern sharecroppers during the Great Depression.Works Cited Agee, James, and Walker Evans. Let Us Now Praise Famous Men. 1941. Boston: Houghton-Mifflin, 1988. Austgen, Susan A. â€Å"Let Us Now Praise Famous Men: Agee and Evans' Great Experiment. † Agee and Evans' Great Experiment. Web. 04 May 2012. . Coogle, Matt. â€Å"The Historical Significance of Let Us Now Praise Famous Men. † The Historical Significance of Let Us Now Praise Famous Men. Web. 05 May 2012. . Hendrick, Veronica C. â€Å"John Steinbeck: The Grapes of Wrath (1939). † Pop Culture Universe: Icons, Idols, Ideas. ABC-CLIO, 2012.Web. 8 May 2012. Hinton, Rebecca. â€Å"Steinbeck's ‘The Grapes of Wrath. ‘ (John Steinbeck's book). † The Explicator 56. 2 (1998): 101+. Literature Resource Center. Web. 8 May 2012. Humphries, David T. â€Å"Returning South: Reading Culture in James Agee's Let Us Now Praise Famous Men and Zora Neale Hurston's Mules and Men. † The Southern Literary Journal 41. 2 (2009): 69+. Literature Resource Center. Web. 10 April 2012. Jackson, Bruce. â€Å"The Deceptive Anarchy of Let Us Now Praise Famous Men. † The Antioch Review 1999: 38-49.ProQuest Research Library. Web. 5 May 2012 . Quinn, Jeanne Follansbee. â€Å"The Work Of Art: Irony And Identification In Let Us No w Praise Famous Men. † Novel: A Forum On Fiction 34. 3 (2001): 338. Academic Search Premier. Web. 8 May 2012. Rothstein Arthur. Fleeing A Dust Storm. Cimarron City, Oklahoma. 1936. Web. 10 May 2012. Silver, Andrew. â€Å"Laughing over lost causes: Erskine Caldwell's quarrel with Southern humor. † The Mississippi Quarterly 50. 1 (1996): 51+. Literature Resource Center. Web. 5 May 2012.

The significance of disillusionment in the two main characters Essay

The significance of disillusionment in the two main characters - Essay Example So, disillusionment prevailing inside an individual’s mind apart making their life a problematic or miserable one, will also create problems to theirs related and associated lives. His/her life will become a big complicated problem, which can be solved only by the person’s themselves, with some aid from others. This aspect of disillusionment has been visible in many fictional characters as well. That is, many fictional characters from different genres of work have faced disillusionment in course of the story. So, this paper will analyze the significance of disillusionment in the two fictional characters, Emma and the governess, who were featured in Jane Austen’s Emma and Henry James’s The Turn on the Screw, respectively. Emma, the female protagonist of the Jane Austin’s play, is the daughter of a wealthy gentleman, who is raised with a lot of comfort. Even though the character of Emma shows care toward others and is well intentioned, it borders on self-centrism with a dose of over-confidence and stubbornness. â€Å"†¦the power of having rather too much her own way, and a disposition to think a little too well of herself† (Austin). Also, being from a wealthy household, Emma hasn’t faced many problematic and stressing issues in her life. But, these favorable times begins to change, when she faces certain problems in her personal life, with her self-centered attitude and stubbornness accentuating the situation. This is when, the disillusionment enters her mind, complicates her life and importantly ‘corrects’ her mindset in the final analysis. That is, the disillusionments, which were result of certain mistakes committed on her part, actually turned her into an emo tionally stronger person, and thus showed its significance. Emma commits the first mistake and gets little disillusioned, when she attempts to â€Å"match make† her teenage friend Harriet to the local vicar, Mr. Elton. And, when Mr. Elton rejects Emma attempts on the account of

Nursing shortage Research Paper Example | Topics and Well Written Essays - 1500 words

Nursing shortage - Research Paper Example The nurse also helps a patient in the carrying out of the therapeutic activities instructed by the physician. The nurse works as a part of a team with others. Together they help in running the program for recovery and improvement to health. They as support those who are dying to appreciate the transition and attain peace of mind. These roles bring out the crucial aspects in nursing. Further, they show the relationship that exists between a nurse and a patient (Feldman, 2011). The nurse and the system of nursing exist within regulated structures. This is essential because of the support that has in terms of resource allocation and credibility. Nursing operates within the health care system, which is changing rapidly. Thus, the stability of nursing depends on proper organization delivering of care, regulated practice for quality assurance and adequate preparation of the nursing profession. This outline is to give a peek into the gap left when we suffer a shortage in the nursing profession (Rosseter, 2012). In May, the year 2011, the recruitment agencies and employers posted over 121,000 ads for nursing positions (Stiger et al, 2009). This was a 46% increase in the demand of the nurse from the previous year 2010. In March, this year (2012), Bureau of Labor Statistics reported that 20% of the total job vacancies were from the healthcare institutions. This clearly shows the trend that employment vacancies are taking. The need for more professional registered nurse is rising every day (Feldman, 2011). In addition, annual rate of turnover of registered nurses is at 14% as per the report by KPMG survey 2012. Professional nursing as an occupation shows the highest tendency of growth. Projects show that the number of employed nurse will increase from 2.8 million to 3.5 million by the year 2020. This growth will partly be contributed by the retirement of about 0.5 million nurses. The shortage of nurses is going to persist in unless we find a lasting

Article Review of Goodbye to the Age of Newspapers by Paul Starr Essay

Article Review of Goodbye to the Age of Newspapers by Paul Starr - Essay Example The main source of revenue for the newspaper companies in advertising has been greatly invaded by the internet which offers cheaper and more flexible mode of information distribution. Subsequently newspapers have slowly been wiped out through staff and company buy outs that have been associated with the low revenue and the numerous debts. He cites a variety of companies that have fallen victim of this movement alongside the recent financial crisis that worsened the problem. He also goes on to interrogate the reason as to why this a great concern for the community and the society in general. The newspaper companies are a source of income for the thousands of professional journalists, editors and writers who are since falling to the unemployed category after massive layoffs to maintain the profitability of the companies. The newspaper venture continues to receive a great challenge from the advancement in technology and this has made it quite unbearable an intolerable for the newspaper companies. The newspaper has been known to provide originality in the coverage of public affairs as opposed to the violence, crime and traffic tie-ups that have often dominated the internet and television broadcasts. This reduction in the content of reporting allows room for the defilement of the democratic spirit in the country since the newspaper have a great role in ensuring that this does not happen through public reporting. Social vices such as corruption begin to appe ar in the society and mostly the government which is kept on check by aggressive public reporting. This therefore has adverse implications on the health of the country’s democracy and the future of public politics. The influx of technology and specifically the internet was meant to amplify the cornucopia of information due to its flexibility. This has however occurred at the expense of the value of reported

The Appellate Courts Research Paper Example | Topics and Well Written Essays - 1250 words

The Appellate Courts - Research Paper Example The legal system of most countries has various levels and as a result, if one of the participants in a case feels discontented/feels that a lower-level court has not judged his or her case fairly; he/she may decide to file a formal appeal, requesting that the case be reviewed in an appellate court. In the event that the appellate court discovers that the lower court erred or used the incorrect legal procedure, for instance, it may decide to overturn the original verdict. History.com documents that the United States’ Supreme Court is a famous example of an appellate court. It is considered as a court of last resort or final appeal – once it hands down a decision, there does not exist a higher court of appeals. The appellate court system guarantees that individuals who desire to make an appeal can do so. A lawyer/team of lawyers has the responsibility of filing an appeal, and experience with the process of appeal is very useful, seeing that it can aid in the achievement o f the desired result. History of the US Appellate Courts The United States’ Court of Appeals had been created by an act of Congress (1891) to ease the Supreme Court of a good deal of its growing appellate duties in addition to remedying dearth in the cumbersome Circuit Court System, which was ultimately eliminated in the year 1911. The nine appellate courts were not to exercise original jurisdiction or to be trial courts. They were to be the essential middle rung in the three-tiered federal court system, which had been envisaged from the First Judiciary Act of 1789 instituted federal courts, pursuant to the Constitution’s Article 3, section 1. Under the courts of appeal were the United States district courts, which acted as trial courts for criminal and civil cases relating to federal law. The Supreme Court was above the courts of appeal. The courts of appeal embodied many aspects of the previous circuit courts. The main responsibility of appellate courts is reviewing the decision of a trial court on a given appealed case, looking for ‘mistakes of law’ that the trial court may have made. They do not ‘second guess’ factual issues that the trial courts decided earlier on. In the legal system, the jury resolves factual issues and not the appellate court (Radcliffe, 1). Each court of appeals had a geographic region, which it served. For the previous Fifth Circuit, that region comprised of Georgia, Alabama, Texas, Louisiana, Mississippi, Florida, as well as the Canal Zone, in essence the same region that the old Fifth Circuit Court served ever since the 1866 re-organization of the circuits. In the year 1869, in an endeavor to fortify the circuits, Congress, sanctioned that a circuit judge be appointed for each circuit. In 1869, President Grant appointed William Burnham Woods as the first judge of the reorganized Fifth Circuit. Don Albert Pardee succeeded him in 1881 (UScourts.gov, 1). In the 1891 Act, which created the Court of Appeals, Congress authorized a second judge for the Fifth Circuit, and in the year 1892, Texan A.P. McCormick took that position. In 1899, David D. Shelby, an attorney from Huntsville, Alabama and ex- Confederate cavalry officer became the third judge for the Fifth Circuit. The Court of Appeals Act (1891) chose one city in each circuit where court would be take place. In 1930, the number of judges in the Court of Appe

Acient art image discussion Essay Example | Topics and Well Written Essays - 500 words

Acient art image discussion - Essay Example The art has conspicuous grey and yellow colors. The art of the colors represents artistic painting reminiscent of Egyptians’ Minoan style (Gardner and Fred 90). All the painted figures have a representation of Mediterranean cultures. The paintings have a characterization of fluidity line, small waist and vitality of character. The Minoan style depicted in the art shows emphasize on spontaneity, elasticity, and dynamic motion. The high-contrasts patterns and the colors elaborate the freshness and elegance of the scene and its characters. Many features of civilization, such as writing and drawing, originated during the ancient Near East. Most communities were hunters and gatherers. The image, therefore, is from the ancient Near East. Art of the ancient Near East displays similarly great variety of forms and style that reflect the many individuals, kingdoms, cities and empires flourishing in the region for thousands of years. Making of this image happened about two thousand years ago. The image depicts the culture of the ancient Near East of a number of ways. Promotion of artistic work was primarily by spiritual, religious, and religious. The image was a major form of communication. Therefore, most of the ancient Near East communities were visually literate than reading words. They could easily read the inscribed words. Two women are featured in this image. The materials used as a part of the craft of the ancient Near East were deliberately selected with gimmicks, for example, color, and hardness as integral elements. Gold and silver were considered to have particular supernatural and apotropaic properties, as did the Lapis Lazuli and Carnelian stones. Valuable metals were referenced in legendary writing to pass on ideas and qualities connected with divinities, essentially in light of the fact that their color, sparkle, and splendor were regarded fitting for divine

Production and Operation Management Essay Example | Topics and Well Written Essays - 1000 words

Production and Operation Management - Essay Example Based on these, the owner selects particular designs to be made on a weekly basis. Ms. Brown also selects the kind of clothing material to be used for the particular chosen design. She employed 10 female workers to work on the rest of the process. Pattern design is done manually by one worker before grading, measurement of fabric, cutting and finally, sewing and assembling. For clothes requiring intricate designs such as patching or needlework, one female worker, Karen Smith, who specialize on this area does the final touch and inspects the garments made prior to pressing and packaging. The first few months of production have been smooth and productive. On the seventh month, there had been returns sent by the shopping mall due to defects. Apparently, some garments were not inspected thoroughly and exhibited the following defects: â€Å"open seams, wrong stitching techniques, non- matching threads, missing stitches, improper creasing of the garment, erroneous thread tension and raw e dges† (Ahmad, 2011). Ms. Brown questioned Karen Smith and was determined to investigate the cause of increased defects. If not corrected immediately, the garment company faces a greater dilemma of revoking their contract to supply garments with the shopping mall. Statement of the Problem There were apparently high levels of returns for garments that have been delivered to the shopping mall. The person authorized to inspect, Karen Smith, also tasked with doing the intricate final designs of patching and needlework. Likewise, no other person counter checked the quality of the garments prior to packing and delivery to the shopping mall. Research Objective The objective of the research was to investigate the cause of the surge of defects on the garments that was already delivered to the shopping mall. The contract to supply garments was usually based on the agreement that no significant defects should be exhibited that would cause returns. Defects of more than 20% in one batch of deliveries would be subject to full return and refund. If the next batch would contain defects of more than 10%, the contract would be revoked. Another objective was to review the manufacturing process to determine ways of minimizing the defects noted and to ensure high quality of garments are consistently delivered. Comparative Key Processes in the Manual to the Actual Practice The process manual clearly indicates that after sewing, Karen Smith, is tasked to inspect the garments prior to packing. Upon closer inspection, Ms. Brown discovered from interviews with the sewers that most of the time, Karen Smith was overloaded with final details of patching and needle work demanded from the chosen designs. As such, with full confidence, she delegated the sewers to closely inspect their works. In this regard, the following flaws in the operations process were noted: (1) The inspector and the person doing final touches on the garments are the same. Increased volume of work to be done leave s little time for inspection. (2) There was no clear policy in the procedures manual regarding any sanctions for violating adherence to high quality standards of the product; (3) There were no clear policies on inspection for the garments or in accurately identifying accountability (which sewer creates the most mistakes and defects); (4) All designs and pattern making are still done manually; (5) Roles and responsibilities for employees

Critical Success Factors Essay Example | Topics and Well Written Essays - 3000 words

Critical Success Factors - Essay Example In the past, there has been a great focus on various leadership competencies in the organization, but the specific focus on the project manager and its competencies has been less effective and progressive. The general characteristics of project managers are that they are intelligent and above average in comparison to another employee within the organization. These characteristic traits plus others have been summed up together by different researchers and simply put together as leadership competencies. Other traits that have been identified by other researchers are related to behavior, motivation, energy, and communication skills. It is evident that there is a positive correlation between character traits and project success. One of the greatest researcher Hogan claim that, the success of a project is greatly determined by the personality of an individual. Other researchers like Anderson draw the intention of the organization while selecting project managers. In 1998 Pinto and trailer carried out a study to identify the characteristic of a project leader and they came up with the following characteristics; credibility of the leader, problem-solving capability, flexible management style and good communication skills and tolerance. The same researchers deliberate on the most desired qualities of project managers that are, administrative skills, technical skills, and vision and leadership examples. These managers should posse’s adequate technical skills and knowledge in a certain field.

Module 4 BHS427 Health Care Finance Cost of Capital (CASE) Essay

Module 4 BHS427 Health Care Finance Cost of Capital (CASE) - Essay Example Despite being highly criticized, CAPM is commonly used by investors and managers, possibly due to its sundry advantages over other models. By using systematic risk only, CAPM tends to be not only more realistic but also simpler by eliminating the unsystematic risk. Remarkably, the relationship between the market risk and expected rate of return is easily shown by the Security Market Line. Secondly, in addition to being empirically testable, CAPM compares the particular investments level of risk to the stock market risk unlike DGM. Moreover, CAPM overcomes WACC’s assumption that investment has no influence on financial risk hence making it better in project appraisal. Conversely, CAPM’s assumptions make it less viable in reality. In project appraisal, the use of a single-period time zone contradicts the nature major real investments, which cut across periods. Moreover, it’s unrealistic to assume a constant beta for the periods as market conditions keep on fluctuating. Again, CAPM faces a problem in assigning values to the variables in the model. None of the variables is constant, with some such as yield on government debt (used to estimate risk free rate of return) changing on daily basis. Dolde et al (2012) research was aimed at determining whether the two factors international CAPM (2F-ICAPM) gives a different cost of capital compared to the domestic CAPM mostly used by US companies. Pre-studies had shown that the single global CAPM generated costs of equity not significantly different from the domestic CAPM despite the former model’s theoretical superiority, hence explaining why managers had not shifted from the domestic CAPM. To formulate the2F-ICAPM, Dolde et al incorporated the world market Index and currency index for chief currencies all expressed in US dollars, making this model theoretically superior to both

Computer Information Specialist Essay Example for Free

Computer Information Specialist Essay Computer Information Specialist, Inc. (CIS) filed a protest of the award of a contract to Open Technology Group, Inc. (OTG). CIS responded to a request for proposals (RFP) No. NLM-030101/SAN by the Department of Health and Human Services for telecommunications support services at the agency’s Bethesda, Maryland facility. The solicitation specified a requirements contract with fixed hourly rates for a base year with four 1-year options. The agency intended to award the contract based on â€Å"best value† with several non-price criteria as the most heavily weighted factors. Proposals were to include fully-loaded, fixed hourly rates for labor categories. The agency received numerous proposals and established a competitive range of four firms after initial evaluation. The range included CIS as well as OTG the eventual awardee. Following the contract award to OTG; CIS underwent an agency debrief and subsequently filed a protest asserting that both its proposal and the proposal of OTG were misevaluated. Issues Agencies are required to evaluate proposals based solely on the evaluation factors identified in the solicitation. Furthermore, according to Federal Acquisition Regulations, they must adequately document the reasons for their evaluation conclusions (FAR § 15.308). GAO recommended to the agency was to, at a minimum reevaluate both proposals to ascertain if they were evaluated based on the evaluation factors and to determine if adequate rationale were articulated. Decisions (Holdings) Anthony H. Gamboa, General Counsel wrote the recommendation. The protest was sustained. Reasoning (Rationale)   GAO concluded that the Department of Health and Human Services misevaluated the proposals of both CIS and OTG, contract awardee. In addition, they found that the agency’s misevaluation was prejudicial to CIS, â€Å"since there is a reasonable possibility that, but for the agency’s errors, CIS might have been selected for award notwithstanding its higher price.† Separate Opinions No dissenting opinion was published with GAO’s decision. Analysis GAO analyzed the proposals from both CIS and OTG against the RFP’s stated evaluation criteria. The Department of Health and Human Services’ source selection team consisted of five evaluators. In the case of the proposal by CIS, the initial evaluation criticized the proposal for not offering personnel that met all of the solicitation minimum personnel experience requirements. CIS revised their proposal to cure this deficiency. In further evaluation, four of the five evaluators scored this area higher than the initial proposal. However, the fifth evaluator scored the proposal dramatically differently. In the first evaluation, only cursory notes were provided to support conclusions. In the second evaluation, most evaluators still provided limited support. However, the fifth evaluator provided comments. Many of the comments were either inaccurate or held not relation to evaluation criteria. With regard to the OTG proposal, GAO determined that the solicitation failed to meet two of the evaluation criteria and should not have been accepted in the competitive range. It was also recommended that the agency terminate the contract awarded to OTG for the convenience of the government and make award to the firm found to be in line for award. Furthermore CIS was to be reimbursed all costs associated with the protest to include legal fees.

Conditioned Stimulus Conditioned Response Essay Example for Free

Conditioned Stimulus Conditioned Response Essay This experiment showed that Albert developed a fear of a white rat through associating a neutral stimulus with a fear provoking stimulus. However some individuals may have inherited a high level of physiological reactivity. The extent to which the individual is classically conditioned to a neutral stimulus could be determined by this physiological reactivity. In addition, animal phobia is more likely to become classically conditioned because there is preparedness for survival from the EEA, other stimuli may not become classically conditioned. Davison found phobias of neutral stimuli cannot be easily conditioned as Alberts experiment suggested; he tried to condition phobias of neutral stimuli in a laboratory but had little success. However being in an experimental setting may have prevented the participants from behaving naturally; therefore the fear was not conditioned. The behaviourist concept of stimulus generalising suggest that a fear response to one thing can be generalised to other things, and as predicted by the behavioural concept Albert generalised the phobia of white rats to other furry white objects such as cotton wool, fur and white beards. However his reactivity may predispose him to the anxious disorder. Due to Albert being a child he may have developed his fear of the rat because he was immediately able to recognise the appearance of the animal is least like a human, he feared other objects that were similar to the rat because he developed a cognitive bias unconsciously. Also the research evidence on phobias being a result of traumatic experiences lacks reliability, as shown by Davison it is difficult to replicate Watson and Rayners experiment; although it was found 50% of people suffering from certain phobias recalled a traumatic experience that had triggered their phobia, therefore supporting classical conditioning. The other 50% of phobics that cannot recall an unpleasant experience initiating their phobia could be due to repression of the expression. The development of phobias can also be explained by Mowrers two-process theory, this involves operant conditioning. The first stage of the process involves classical conditioning, for example linking the white rat and the loud noise. The second stage of the theory involves operant conditioning as avoidance of the phobic stimulus reduces the fear response and is thus reinforcing, therefore the fear is maintained and a phobia is developed. Behavioural explanations are reductionist; they oversimplify concepts to one specific thing and ignore other factors. The explanation is also deterministic because it suggests behaviour is controlled by the environment and ignores the individuals own ability to control their behaviour. Social learning theory explains fear as not being intentional, the learning of the fear happens at an unconscious cognitive level. Evidence of modelling was found in monkeys that observed other monkeys displaying a fearful reaction to a snake; these monkeys developed a phobia of snakes because it is a harmful stimulus. Bandura proposed phobias can be learnt through observational learning, modelling and direct reinforcement. There are other psychological explanations of anxious disorders. The cognitive explanation suggests faulty thinking is the cause of phobias. Beck and Emery conceded that anxious people avail cognitive biases, which causes them exaggerate the threats posed by stimuli. This has face validity because phobics have reported high level of anxiety and it is plausible that phobics find their environment a threatening place. Clarks cognitive theory of panic disorder suggests individuals suffering from panic disorder tend to interpret their bodily functions over sensitively i.e. they react to their bodily functions in a life-threatening way. This makes them more anxious and increases their catastrophic thoughts. However it cannot be identified if cognitive biases are the cause of phobias or if the phobias are the cause of the individuals cognitive biases. Also the over consciousness of bodily response could be due to physiological reactivity of the individual and it maybe the underlying cause of the fear. The explanation is description rather than explanatory; it describes the thought patterns of the individual but does not explain why the individual is having these thought patterns. The social explanation is another psychological explanation of anxiety disorders. According to this explanation parental rearing styles have an impact on the development of phobias. It has been found that parental styles that are high in control and overprotection and low in affection are linked to social phobia and agoraphobia. However accounts of parental styles are retrospective. Another limitation is all that has been obtained is correlations between rearing styles and anxiety disorders, correlations do not prove causality. There is evidence that phobics experience more serious life events before the onset of the anxiety disorder, in Kleiner and Marshalls study, 84% of agoraphobics reported to have experienced family problems prior to their first panic attack. Finlay and Brown found a difference between anxious and depressed patients in terms of life events they had experienced in the 12 months prior to the onset of their disorder. Both groups had experienced an above average number of life events, but anxious patients tended to have experienced danger events, whereas depressed patients experienced loss events. However life events may be a factor of variables that developed the disorders. In conclusion the behavioural explanation claims phobias are developed as a result of classical and operant conditioning, this is called the two-process theory. The experiment with Albert demonstrated classical conditioning. However, research indicates that phobias do not depend on having previously encountered a frightening situation, and individuals that have experienced frightening encounters do not necessarily develop a phobia. Social learning theory is a behavioural explanation that may apply to some specific phobias. The cognitive explanation suggests that the individual suffering from the phobia have cognitive biases which cause the individual to exaggerate the threat posed by the stimuli. Some individuals may react to their bodily responses in a catastrophic way more than other individuals because they have a higher physiological reactivity. The social explanation can be used to explain the development of phobias through parental rearing styles and life events. The main problem with obtaining information about parental rearing styles may be the individual perceives the style differently from how it actually was. The main problem with obtaining information on life events is that it was in the past the so remembering them may be distorted and some events may have been forgotten. All three accounts of psychological explanations can be used to describe the development of phobias; however there are other explanations of anxiety disorders that are not psychological such as the evolutionary explanation. According to preparedness argument phobias are adaptive because they are a fear of things that would have been a threat to humans in the EEA. The evolutionary explanation is a counter perspective of the conditioning explanation and may explain why replications of Watson and Rayners experiment failed to condition phobias to neutral stimuli.

Development and Future of the Apple iPod

Development and Future of the Apple iPod The iPod is perhaps the most talked about technological product in recent times. It has set sales records that have lave literally destroyed the predictions of all analysts by superseding everyone’s expectations. The interesting issues concerning this topic is how the iPod impacted not only the digital music electronics industry, but was also responsible for the turnaround of a company on the brink of bankruptcy. It is this very fact that makes the growth and life cycle of iPod an experience in itself and one that creates a sense of wonder at its success. But how did all this come about and just why did the iPod do so well? These are questions that we look to find answers towards whilst shedding light on the internal pressures faced by the parent company Apple. The paper takes the reader through the history of the parent company Apple and its declining fortunes until the introduction of the iPod. This revolutionary innovation then dictated the pace at which the organisation was able to turn itself around to become one of the more successful computer companies in the world today. The report also looks at how Apple as a company defines itself with the onset of the iPod boom – can it still call itself a computer company in the literal sense of the word or does it now see itself entering a diversified phase of business operations and hence, would need to re-think it’s overall business strategy and core competencies. The views of different writers expressed through the paper help in building an understanding of the pressures the company has undergone over the last decade and why it has taken the decisions that it has. The paper revolves around the growth of the iPod as the key driving force for all major business and technical decisions, it understand how it had to be re-modelled and adapted to the market needs and demands. The paper also paints the competitive landscape at different stages of the growth cycle and how this impacted or did not impact the iPod. Finally, the paper looks at the varying consumer tastes, the positives drawn from the product itself and what lies in store for the future of the product and the company. The methods used to create a deeper understanding of the iPod environment were through a variety of primary and secondary sources. Some of this is discussed in greater detail in different section of the paper. However, for the purpose of this report, the researcher took great care in trying to put together different pieces of work by various writers so as to be able to provide more holistic and all-encompassing view of the real scenario that surrounded the iPod boom. On a more generic note, most writers and experts within the industry agreed that the success of this product was unrivalled by others of its kind in recent times. Introduction Background Success stories always find their way to centre-stage. But what makes a journey even more interesting is when accompany that finds itself in some level of difficulty turns the tide and jump starts its engines to climb to the top of the success ladder. Apple’s is one such story. Whilst the problems that affect it lie in the background, the phenomenal success of its iPod has people fascinated. Marketing gurus swear by the growth of this innovative product that provided the perfect solution to a generation that was technologically familiar and defied competition to control every conceivable bit of the market that it entered – the digital music space, and made it its own. How and why is what we attempt to discover. History The history of the iPod dates back to the January of 2001. Apple had just introduced ‘iTunes’ – a programme that enabled Accusers to burn music off audio CD’s and convert them into music files on their computer systems as digital audio files. This provided users with the flexibility of creating libraries for their music files, clubbing favourite songs in order and in time to come, download them to portable devices. This natural extension saw the introduction of the iPod in the month of October 2001. Unlike other portable devices in the same range, the iPod was the first of its kind to store music files on a hard disk similar to a computer. Other devices used flash cards and detachable storage devices that could not hold as many bytes of data as the iPod did. Infect, the first few iPods had a 5GB storage space, which equated to the storage of approximately a 1000 songs. The question to be asked at this stage was if the software for writing music to the computer was developed keeping the iPod in mind? However, sources within the company maintain that the iPod was only conceptualised 6 months before its release date. Whatever the truth might be, the two scenarios complemented each other beautifully giving consumers the best of both worlds and a logical extension to the process of listening to music. In November 2001, the first iPods were shipped to waiting buyers and byte end of the year, 125,000 iPods had been sold for a price of $399.Within a year, other computer companies as well as large retailers were selling iPods as value-adds. Dell, Best Buy and Target were some of the more prominent names at this stage and had dedicated sites and sales teams pushing for iPod sales. By June 2003, Apple had managed to sell 1 million iPods, which could download music from both Macs as well as PCs. Interestingly, by the end of 2003, one of its largest resellers Dell; had decided not to sell anymore iPods and instead launch its own version of the iPod called the DJ(Digital Jukebox). In order to download songs from the Internet, Dell partnered with a company called Music Match that offered that service. By mid-2004, 6 months after it hit the 1 million mark, Apple crossed the 2 million mark in iPod sales but the peripheral market was just getting warmed up to the portable devices segment. In addition to thud by Dell, HP announced that it was repackaging the 4G iPod and selling it as a PC friendly device. Motorola launched its next generation phones that would be iTunes compatible. In one of the more recent statistics of the iPod wave collated in October 2004, there were some interesting findings. Apple held 82 per cent of the digital market across all music players and 92 per cent of all hard-disk based music players. The nearest competitor to the iPod was the device launched by Creative. They had a 3.7 per cent market share. In addition, 2 million iPods are being sold every 3 months. The music industry too has gained immensely through these sales. The total number of downloads have been clocked at a 150 million which equates to 4 million per week. The latest iPod has a mechanism that enables the storage of digital photographs as well as music. Today, Apple figures have registered total of 6 million iPod sales. That’s a fascinating growth path, which would make any marketing professional envious of replicating that kind of success. On careful consideration though, it took very long for iPod to really drive its sales figures to the kind that it was able to achieve in the years 2003 and 2004. Until then, the figures were good, but not something to write home about. The turning point for Apple came with the introduction of the third generation iPods. This is apparent since it took almost 2 years for iPod to register its first million in sales and soon after the launch of the 3G iPod in Tokyo less than 6months later; Apple was able to register its second million in iPod sales. Interestingly, the sales figures recorded over the 3-year period were averse to any form of competition from companies such as Creative, Dell, river etc. They sold cheaper products but not for a moment, did they encroach upon the market share that was and is still monopolised by iPod. Apple has also utilised an aggressive marketing strategy towrope in different age groups by using the draw of celebrities and song choices. For instance, in late October 2004, Apple unveiled what was called the U2 iPod. Apple conducted a promotion exercise in sync with the release of U2’s song – Vertigo. The new iPod was designed with black casing, a red wheel and a back cover that had the engravings ofU2 with the band signatures. It is little things such as these that have made the iPod such a role model for marketing strategists. The unique blend of having a great product and infusing the right level of awareness and visibility to sell it to the masses. In the chart below, the growth path of the iPod from its inception, to the end of 2004shows how sales surged in 2003 after the release of the 3G iPods as mentioned earlier. Not to mention, as the iPod sales soared, so did the number of downloads for music. Initially, the software iTunes needed tube bought in order to write songs from audio CD’s to the computer, following which they could be downloaded to the iPod. In 2003, Apple introduced an online music store that enabled iPod users to download music directly from the Internet. This worked in 2 ways – it provided users with an increase in choice of music that they would like to have downloaded as well as simplified the procurement of iTunes. No more dada user have to buy a software, install it onto the computer and then use it to burn music off a CD and finally onto the hard disk of the iPod. Simplifying this process for millions of users had its positives as can be seen from the graph above. The first big jump in sales was in October 2003 when the PC version of the music store went live. This enabled far more users to be able to download songs onto their computers and diluted the monopoly of Accusers. 2 months later, in December 2003, following a lot of media hype and attention being given to the iPod and a corresponding increase in Christmas sales, more and more people began downloading songs from iTunes. And in between July 2004 and October 2004, Apple registered growth of song sales from a 100 million to a 150 million. (http://www.ipodlounge.com/articles_more.php?id=4280_0_8_0_M) It must be noted that in many instances within the paper, the use of iPod and Apple is synonymous. After much deliberation, the researcher decided that it was important to approach the paper from the perspective of the parent company Apple. Any impact that the environment would have on Apple would be reflective in the iPod strategy. At the same time, in circumstances that would affect the company both positively and negatively, would subsequent effect the iPod and vice-versa. Aims and Objectives The aim of this paper is to understand the growth of the iPod through the years. It all began in the year 2001 and it has been a short journey to success. But how long will this be able to continue, what is the future for the product, how will it fend off competition and how will it impact Apple in the longer run. We all know that it has been apathy-breaking journey for Apple as it picks itself up from the doldrums of declining computer sales with its innovative invention that saw it spring back into the limelight. It is also the endeavour of this paper to highlight how important an impact the iPod has had on Apple alone and why can’t other company’s model the same success story. Literature Review The Success of the iPod According to Haddad, Charles (2002),the iPod is one of the most revolutionary products to hit the computer and electronics market place. He believes that the only way forward for Apple is to diversify its product range and move from being a niche computer manufacturer to providing technology that understands the gap between technology and entertainment. He quotes how the market share for Apple in 2002 had remained at 3 per cent for a number of years. In order to move it from there, it was imperative that they looked beyond the computer industry since it was reaching a saturation point in most developed markets and the level of competition from across the globe was making it extremely difficult for large computer manufacturers to survive. Digital handheld music players were a growing market in 2002. There were few players in the market place and industry experts such as ID Chad stated that demand would grow by 74 per cent over the next 3 years. In retrospect, they weren’t right – but only because the demand has recorded triple digit growth since 2002. In addition, the anticipated sales for 2002 were pegged at 12 million units of all kinds of portable digital music devices. Haddad brings up an important point about how the level of competition within the digital handheld music products industry was still at a minimalistic stage in comparison to other industries where companies such as Microsoft and Intel who had taken over the PC market. He believed that the next generation of buyers were more interested in a product that was different, satisfied their requirements and at the same time, was ‘cool’ and suave to have. Especially in the case of handheld devices where consumers would cart it around with them, this need for trendy and sophisticated gadgets was of the utmost importance. At the time of writing his article, Haddad had researched the iPod when music files were downloadable only from a Mac. The iPod sales were still consistent and looking positive during that stage but Apple had not introduced downloading files onto PC’s at that stage. Once that happened, iPod sales grew dramatically. The iPod was never intended to lift the flailing computer business of the parent company but overtime, Haddad statements would hold good, as the iPod would grow to become one of the most successful products ever launched by a computer company. (Haddad, Charles, iPod, You Pod, Will We All Pod? Business Week Online; 7/3/2002) Teething problems with Strategy? With the degree of success that the iPod has seen over the years, there have been few instances that writers have been able to find a chink in the armour of this hugely successful product. One such writer is Salk ever, Alex (2004). In the first of his articles – ‘Apple’s slow boat to China’, he discusses how the Chinese economy is one of the most lucrative investment decisions for businesses the world over and how Apple has failed to take advantage of this huge opportunity. He begins by using the views of consultants who have worked within the Chinese market place for decades now and seen it evolve over the years. He quotes Merrill Weingrod who works with a marketing consultancy – China Strategies. When Salk ever asks Weingrod how lucrative the Chinese market is for product such as the iPod, he answers saying that the market potential for men’s electric shavers is $300 million annually. Weingrod believed that the Chinese have the buying power to spend $200 to $250 on luxury shavers today which are not a necessity by any standing. This was just an indication of their mind-sets and how much they were willing to spend and for what. He reiterates this by stating that the Chinese population measures 300 million in terms of the number of cell phone subscribers across the country. They pay an average of $200 for their handsets and connectivity. In addition, the average Chinese employee earns far less than his / her American counterpart and yet, he / she is willing to pay larger proportion of their salary towards buying luxury goods. This equates to the buying potential and eagerness amongst the population and above all – a prospective consumer. One who is constantly on the lookout for the infusion of luxury goods into the market so that he /she can go ahead and purchase it, provided there is a need of course. In addition, the Chinese economy is the fastest growing economy in the world with its GDP growth rate pegged at 9 per cent annually. It has one of the largest middle-class societies in the world with disposable income that is growing as fast as their growth rate. With every factor in the book of marketing pointing towards the Chinese market, Salk ever is dismayed at Apple’s strategy to stay out of this market and not undertake an aggressive marketing strategy that would tap it’s he potential. The only real steps that Apple has taken towards entering this economy is to ensure that iTunes Music software is downloaded onto every Manufactured by China’s second largest computer manufacturer – Founder Technology. It is an ironical decision considering the consumer who would purchase the machine would have little access to the iPod on which he could have downloaded his / her music. Besides this decision with the Chinese industry, Apple hasn’t taken any more steps towards making any investment decisions in this region. There was one instance when they almost toyed with the idea of opening an iTunes Music Store but then retracted any steps made in that direction. The figures that Salk ever quotes are astounding to the reader. According to him, at least .3 present of the population of China has disposable income that equates to that of an individual in the US who would earn approximately $25000 to $30000 annually. That figure translates to approximately 60 million people today and will grow to 3to 4 times that number over the next decade. With the increasing middleclass and the ability to buy products that others around the world can afford, very soon the Chinese middle class would equal the entire population of the United States. So what do the Chinese see these new gadgets in the market place as? According to market analysts Bryan Mama company that tracks the buying of cell phones in Asia, but based in Singapore, the number of cell phones that are replaced are astounding. The Chinese people like to replace their cell phones 6 to 12 months earlier than consumers in North America and Western Europe. Gadgets are seen as a status symbol of sorts. Owning the latest models makes individuals feel like they are popular and wanted, according to the company. Chinese consumers also tend to go for gadgets that are sleek, suave and trendy. According to Salk ever those are the kinds of words that would define the iPod but they don’t find any place in the market. He tries to look at the picture from Apple’s perspective. As a company, Apple’s strategy is to consolidate and preserve its position in the markets that it is strong in. In the bargain, it would not look to invest in new markets such as China. In fact, Apple has a miniscule presence across the entire length and breadth of Asia. If Japan is taken out of the equation, Apple draws less than 10 per cent of total sales from this region. Naturally, it is not an area of too much interest for the moment. Whilst Apple takes a back seat to proceedings in this region, competition in the form of Sony, Motorola and Creative have made inroads into the Chinese market. As an example, Motorola entered the Chinese handset market early and in the first quarter of2004, it was proud to declare that it has achieved a market share of 40per cent. It had the first mover’s advantage introducing a technology that few others were brave enough to take into this country many years back and today it has paid off. The Chinese market is known for its penetration problems. The researcher agrees with the insights that Salk ever has provided into this untapped region and understand the problems that Apple faces in the future lest it not take steps in this direction. The level of investment required at a later date where the market is abuzz with competition would be significantly higher. It makes completes sense for companies to invest in C hina at this stage and there is no reason why Apple should not be one of them. (Salk ever, Alex, Business Week Online; 7/22/2004) In another article by Salk ever albeit on a different issue, he adopts similar stand on the problems that will plague Apple. In his article, ‘iPod: Leader, but Not Ruler’, he states that the sales figures by Apple are either over-exaggerated or are inaccurate since there isn’t enough evidence that the data being collated is validated. Apparently, data in countries in Latin America, India, South Korea, Eastern European Taiwan are difficult to validate and not easy to obtain. There are also other areas across Asia, including China where data retrieval and collation is not as accurate as it is made out to be. So when Apple boasts of global sales and achieving market shares across the world in excess of 50 per cent across the electronic market (MP3 players), they may very well be over the top. To evidence his findings, Salk ever looks at the various methods that companies use to collate market data that can be passed onto consumers and other business prospects. On one hand, they can utilise the services of US market research companies such as the NPD group that solely dedicates its efforts to the US retail economy. On the other hand, companies such as Apple can resort to asking OEM (Original Equipment Manufacturers) and component manufacturers how many pieces they are taking to the market place. Whatever may the case be, according to Salk ever, Apple doesn’t quite have accurate information omits global market share. He confirms that Apple is certainly a global leader but not dominant. This could have been a very interesting report but the only flaw with his research is that he fails to document enough evidence either through statistics or through credible sources that can allow him to judge with some level of certainty that Apple’s iPods are infect facing tough times ahead. To be fair to Salk ever though, he does introduce the subject of the growing competition of iPods outside the borders of the US from Asian electronics companies. In the coming years, cheaper labour costs of the Asian companies will allow them to create inexpensive models of the iPod and compete on price aggressively. In addition, Salk ever states that the Asian consumers who are growing to the largest consumers of entertainment products, prefer smaller sized iPods. This is not in sync with Apple’s strategy since they plan to introduce larger and heavier models of the iPod in the coming few months. And even if iPod does take the cue and invests in smaller models in time, it would have lost outing comparison to other digital music manufacturers. But Salk ever does summarise his studies by admitting the dominance of iPod within the digital market place, yet cautions against rising competition and price sensitive market in the near future. (Salk ever, Alex (2004) Business Week On line; 5/27/2004) Curzon (2005) has an equally interesting point of view. He believes that the iPod boom would not be able to sustain the success that it has experienced for much longer. His rationale is based around stock prices and other statistics that he discovers about Apple which point towards changing tide in the coming years. Curzon promotes the concept that Apple as a company is on the decline once again and encourages people to sell their shares now since they would lose money in the coming few months lest they hang onto them. He begins by mentioning the usual success stories of the company – the last 2 years have seen iPod sales rise more than twenty times from 219,000 units towards the end of 2002 to over 4 million units at the end of last year. In fact, Lehman Brothers had initially projected iPod sales to be approximately 3million units at the end of 2004. They had to revise their figures closer to the end of the year and pegged it again at 4 million units for the year 2004. Apple on the other hand clocked 4.5 million units for the year ending 2004, ahead of anybody’s expectations. Another indication of the progressive rate of success is how the number of downloads from the iTunes rose from 50 million to 200 million. Finally, the biggest turnaround statistic lies in how the company almost went bankrupt after the dotcom era a decade ago and last year, recorded sales figures in excess of $3 billion with no debt on their financial statements. What makes very interesting reading is how Ken Curzon describes the decline in the demand of iPods and correspondingly, with the parent company as well. He states that after the Christmas rush for buying iPods, in all probability consumers will not be willing to spend as much money on it. As he puts it – â€Å"Holiday shoppers are more enthusiastic about higher prices, but once the holiday season ends, they usually don’t like to spend money on products that are priced at a premium†. In keeping with the same, Curzon predicts that in the first few months of 2005, the rate at which consumers buy iPods would drop gradually at first and then, more drastically later in the year. Lehman Brothers too have declared that they expect a 14 per cent drop in sales figures over the course of the year. In another case, Curzon talks about how on one hand, the sales of iPods have certainly been increasing in conjunction with an increase in market share, but the parent company Apple has seen a decline in its market share from 2 per cent to 1.9 per cent. The ‘Apple Stores’ are an over-riding success because of the iPod and its driving consumers tithe stores. But although the number of footfalls across these stores has doubled, the number of consumers buying Apple PC’s has remained constant. Additionally, Apple’s revenue figures in comparison to other computer companies are very average. For a company that is on the biggest ride of its business life, it records a growth rate of 33 present in comparison to HP’s 29 per cent. And what makes this look more dismal according to Curzon is that the operating margins for the previous year were declared at 3.94 per cent. This was far lower in comparison to HP’s 5.2 per cent and Dell’s 8.56 per cent. (Curzon, Ken, Esquire; Mar 2005, Vol. 143 Issue 3, p112) Somehow, Curzon does shed light on certain statistics that project Apple’s performance in a questionable light but on closer observation, it appears that the facts have been manipulated to project a negative perspective to the progress of Apple. The researcher believes this tube the case since there are many individuals who constantly try and influence the market forces through published writing such as this to ultimately try and manipulate the performance of the stocks. For every negative statement that Curzon was able to highlight, there appears tube an equally positive explanation for the same. For instance, decline in market share by .1 per cent is not necessarily a negative impact on the company. It depends on the marketing strategy of the company – is it trying to move out of certain markets and invest in others. Additionally, in saturated market places such as the US, any form of product diversification would have an impact on the market share as well. So there are considerations that need to be taken before any conclusions can be made. At the same time, the researcher believed it important to include Curzon’s work since it was one of the most recent articles on the iPod that sounded warning bells and tries to get the reader to see the success story from a different perspective. So where exactly is Apple headed towards now? According to Murphy(2004), a significant contribution of Apple’s success can be attributed to the iPod and hence, any future success parameters would also be defined by the iPod. The competition amongst the computer industry is very intense with players such as Microsoft for software, Dell, HP undim for hardware and a host of other system integrators and competitive channel partners. Due to a diminishing market share as mentioned earlier of under 2 per cent, the total business worth of the company has fallen to half that of its sales revenue. The only light in this dark tunnel is the fact that the stock price at Apple has almost doubled over the past 2 years. But can the parent company depend on single product offering and expect to piggyback ride it all the way tithe bank? It’s not possible says Murphy. There will come a time in the near future when sales of iPods begin to decline, competitive forces take over with lower priced products and existing markets begin to get saturated. Some of these products would come from companies such as HP,Dell, Sony, Creative, Gateway and Rio, each offering a product that is significantly cheaper and has greater memory storage in comparison tithe iPod. For instance, Creative has launched a new product that also has a longer battery life and also has white earplugs similar to those of Apple, taking a leaf out of Apple’s trendy design. At the same time, it has been seen that consumers have complained about the lack of availability of iPods in the stores. And to make matters worse, Apple hasn’t been able to confirm a deadline by when they would be made available. Times will change gradually. As Murphy mentions – the pricing of the iPods over time will fall significantly and Apple would need to sell more and more iPods just to maintain the revenue figures. For instance, there is an assumption based on pricing that Apple would need to sell at least 20 per cent more iPods in the coming year to be able to sustain the same level of growth over the year. This should not be a problem currently considering growth is predicted to rise to 70 per cent but in time, this could certainly become an issue. If looked at differently, Murphy argues that falling prices of products are fine as long as business efficiencies were rising. 4 years ago, when the sales figures of Apple were 4 per cent higher than they are today, the operating profits of the company were at 9 per cent of total sales. Today, that figure has come down to 3 per cent. In addition, the number of employees added over the past 4 years has gone up by 32 per cent and the sale per employee has significantly decreased from $930,000 to$674,000. For apple to be able to sustain its growth and maintain a leading position in the market place, it cannot depend wholly on the iPod revolution. Its notebooks and desktop products account for 64 per cent of its current sales as a company. But except for the month of June that recorded a 14 per cent increase in revenues, the rest of the year remained much the same in terms of sales. This is worrying for Apple since it doesn’t have too many back up measures to fall on should they land in trouble. To tackle some of this problem, Apple had introduced a series of Apple stores across the US, UK and parts of Western Europe. These stores hosted the latest introductions by the company including all models of the iPod and its peripherals. The rationale lay in ensuring that consumers would walk into these stores with the excuse of looking at the iPods and at the same time, browse around and take look at the range of other Apple products as well. Unfortunately though, this move didn’t bring in the kind of sales that Apple management had predicted. When Apple was asked about this stagnancy that was creeping into their product lines, they said that 50 per cent of all buyers at their new stores that they have introduced are new consumers and they propose to build relationships through their product quality and peripherals and increase their market share of repeat buyers. Interestingly, Murphy is one of the only writers on this subject who believes that the main fault of Apple’s moderate performance lies with its CEO Steve Jobs. Over the course of its business history, Apple has always ensured that its software configures only with its hardware and no others. For instance, the Mac operating system can only be run on Mac computers. In comparison, the Windows Operating systems can be used on a variety of different hardware systems making it a more universally accepted operating system. The time for niche solutions in not the way forward. Apple must realise that the money lies in the numbers and they can in no way get to those numbers by limiting access to their software. It really is a Catch-22 situation for them. In much the same way, the iPod can only play music that has been downloaded from iTunes. What happens when the iTunes faces intense competition from other music download software companies in the near future? Are we saying that the iPod would only have limited access to music and perhaps, not the entire range of mus Development and Future of the Apple iPod Development and Future of the Apple iPod The iPod is perhaps the most talked about technological product in recent times. It has set sales records that have lave literally destroyed the predictions of all analysts by superseding everyone’s expectations. The interesting issues concerning this topic is how the iPod impacted not only the digital music electronics industry, but was also responsible for the turnaround of a company on the brink of bankruptcy. It is this very fact that makes the growth and life cycle of iPod an experience in itself and one that creates a sense of wonder at its success. But how did all this come about and just why did the iPod do so well? These are questions that we look to find answers towards whilst shedding light on the internal pressures faced by the parent company Apple. The paper takes the reader through the history of the parent company Apple and its declining fortunes until the introduction of the iPod. This revolutionary innovation then dictated the pace at which the organisation was able to turn itself around to become one of the more successful computer companies in the world today. The report also looks at how Apple as a company defines itself with the onset of the iPod boom – can it still call itself a computer company in the literal sense of the word or does it now see itself entering a diversified phase of business operations and hence, would need to re-think it’s overall business strategy and core competencies. The views of different writers expressed through the paper help in building an understanding of the pressures the company has undergone over the last decade and why it has taken the decisions that it has. The paper revolves around the growth of the iPod as the key driving force for all major business and technical decisions, it understand how it had to be re-modelled and adapted to the market needs and demands. The paper also paints the competitive landscape at different stages of the growth cycle and how this impacted or did not impact the iPod. Finally, the paper looks at the varying consumer tastes, the positives drawn from the product itself and what lies in store for the future of the product and the company. The methods used to create a deeper understanding of the iPod environment were through a variety of primary and secondary sources. Some of this is discussed in greater detail in different section of the paper. However, for the purpose of this report, the researcher took great care in trying to put together different pieces of work by various writers so as to be able to provide more holistic and all-encompassing view of the real scenario that surrounded the iPod boom. On a more generic note, most writers and experts within the industry agreed that the success of this product was unrivalled by others of its kind in recent times. Introduction Background Success stories always find their way to centre-stage. But what makes a journey even more interesting is when accompany that finds itself in some level of difficulty turns the tide and jump starts its engines to climb to the top of the success ladder. Apple’s is one such story. Whilst the problems that affect it lie in the background, the phenomenal success of its iPod has people fascinated. Marketing gurus swear by the growth of this innovative product that provided the perfect solution to a generation that was technologically familiar and defied competition to control every conceivable bit of the market that it entered – the digital music space, and made it its own. How and why is what we attempt to discover. History The history of the iPod dates back to the January of 2001. Apple had just introduced ‘iTunes’ – a programme that enabled Accusers to burn music off audio CD’s and convert them into music files on their computer systems as digital audio files. This provided users with the flexibility of creating libraries for their music files, clubbing favourite songs in order and in time to come, download them to portable devices. This natural extension saw the introduction of the iPod in the month of October 2001. Unlike other portable devices in the same range, the iPod was the first of its kind to store music files on a hard disk similar to a computer. Other devices used flash cards and detachable storage devices that could not hold as many bytes of data as the iPod did. Infect, the first few iPods had a 5GB storage space, which equated to the storage of approximately a 1000 songs. The question to be asked at this stage was if the software for writing music to the computer was developed keeping the iPod in mind? However, sources within the company maintain that the iPod was only conceptualised 6 months before its release date. Whatever the truth might be, the two scenarios complemented each other beautifully giving consumers the best of both worlds and a logical extension to the process of listening to music. In November 2001, the first iPods were shipped to waiting buyers and byte end of the year, 125,000 iPods had been sold for a price of $399.Within a year, other computer companies as well as large retailers were selling iPods as value-adds. Dell, Best Buy and Target were some of the more prominent names at this stage and had dedicated sites and sales teams pushing for iPod sales. By June 2003, Apple had managed to sell 1 million iPods, which could download music from both Macs as well as PCs. Interestingly, by the end of 2003, one of its largest resellers Dell; had decided not to sell anymore iPods and instead launch its own version of the iPod called the DJ(Digital Jukebox). In order to download songs from the Internet, Dell partnered with a company called Music Match that offered that service. By mid-2004, 6 months after it hit the 1 million mark, Apple crossed the 2 million mark in iPod sales but the peripheral market was just getting warmed up to the portable devices segment. In addition to thud by Dell, HP announced that it was repackaging the 4G iPod and selling it as a PC friendly device. Motorola launched its next generation phones that would be iTunes compatible. In one of the more recent statistics of the iPod wave collated in October 2004, there were some interesting findings. Apple held 82 per cent of the digital market across all music players and 92 per cent of all hard-disk based music players. The nearest competitor to the iPod was the device launched by Creative. They had a 3.7 per cent market share. In addition, 2 million iPods are being sold every 3 months. The music industry too has gained immensely through these sales. The total number of downloads have been clocked at a 150 million which equates to 4 million per week. The latest iPod has a mechanism that enables the storage of digital photographs as well as music. Today, Apple figures have registered total of 6 million iPod sales. That’s a fascinating growth path, which would make any marketing professional envious of replicating that kind of success. On careful consideration though, it took very long for iPod to really drive its sales figures to the kind that it was able to achieve in the years 2003 and 2004. Until then, the figures were good, but not something to write home about. The turning point for Apple came with the introduction of the third generation iPods. This is apparent since it took almost 2 years for iPod to register its first million in sales and soon after the launch of the 3G iPod in Tokyo less than 6months later; Apple was able to register its second million in iPod sales. Interestingly, the sales figures recorded over the 3-year period were averse to any form of competition from companies such as Creative, Dell, river etc. They sold cheaper products but not for a moment, did they encroach upon the market share that was and is still monopolised by iPod. Apple has also utilised an aggressive marketing strategy towrope in different age groups by using the draw of celebrities and song choices. For instance, in late October 2004, Apple unveiled what was called the U2 iPod. Apple conducted a promotion exercise in sync with the release of U2’s song – Vertigo. The new iPod was designed with black casing, a red wheel and a back cover that had the engravings ofU2 with the band signatures. It is little things such as these that have made the iPod such a role model for marketing strategists. The unique blend of having a great product and infusing the right level of awareness and visibility to sell it to the masses. In the chart below, the growth path of the iPod from its inception, to the end of 2004shows how sales surged in 2003 after the release of the 3G iPods as mentioned earlier. Not to mention, as the iPod sales soared, so did the number of downloads for music. Initially, the software iTunes needed tube bought in order to write songs from audio CD’s to the computer, following which they could be downloaded to the iPod. In 2003, Apple introduced an online music store that enabled iPod users to download music directly from the Internet. This worked in 2 ways – it provided users with an increase in choice of music that they would like to have downloaded as well as simplified the procurement of iTunes. No more dada user have to buy a software, install it onto the computer and then use it to burn music off a CD and finally onto the hard disk of the iPod. Simplifying this process for millions of users had its positives as can be seen from the graph above. The first big jump in sales was in October 2003 when the PC version of the music store went live. This enabled far more users to be able to download songs onto their computers and diluted the monopoly of Accusers. 2 months later, in December 2003, following a lot of media hype and attention being given to the iPod and a corresponding increase in Christmas sales, more and more people began downloading songs from iTunes. And in between July 2004 and October 2004, Apple registered growth of song sales from a 100 million to a 150 million. (http://www.ipodlounge.com/articles_more.php?id=4280_0_8_0_M) It must be noted that in many instances within the paper, the use of iPod and Apple is synonymous. After much deliberation, the researcher decided that it was important to approach the paper from the perspective of the parent company Apple. Any impact that the environment would have on Apple would be reflective in the iPod strategy. At the same time, in circumstances that would affect the company both positively and negatively, would subsequent effect the iPod and vice-versa. Aims and Objectives The aim of this paper is to understand the growth of the iPod through the years. It all began in the year 2001 and it has been a short journey to success. But how long will this be able to continue, what is the future for the product, how will it fend off competition and how will it impact Apple in the longer run. We all know that it has been apathy-breaking journey for Apple as it picks itself up from the doldrums of declining computer sales with its innovative invention that saw it spring back into the limelight. It is also the endeavour of this paper to highlight how important an impact the iPod has had on Apple alone and why can’t other company’s model the same success story. Literature Review The Success of the iPod According to Haddad, Charles (2002),the iPod is one of the most revolutionary products to hit the computer and electronics market place. He believes that the only way forward for Apple is to diversify its product range and move from being a niche computer manufacturer to providing technology that understands the gap between technology and entertainment. He quotes how the market share for Apple in 2002 had remained at 3 per cent for a number of years. In order to move it from there, it was imperative that they looked beyond the computer industry since it was reaching a saturation point in most developed markets and the level of competition from across the globe was making it extremely difficult for large computer manufacturers to survive. Digital handheld music players were a growing market in 2002. There were few players in the market place and industry experts such as ID Chad stated that demand would grow by 74 per cent over the next 3 years. In retrospect, they weren’t right – but only because the demand has recorded triple digit growth since 2002. In addition, the anticipated sales for 2002 were pegged at 12 million units of all kinds of portable digital music devices. Haddad brings up an important point about how the level of competition within the digital handheld music products industry was still at a minimalistic stage in comparison to other industries where companies such as Microsoft and Intel who had taken over the PC market. He believed that the next generation of buyers were more interested in a product that was different, satisfied their requirements and at the same time, was ‘cool’ and suave to have. Especially in the case of handheld devices where consumers would cart it around with them, this need for trendy and sophisticated gadgets was of the utmost importance. At the time of writing his article, Haddad had researched the iPod when music files were downloadable only from a Mac. The iPod sales were still consistent and looking positive during that stage but Apple had not introduced downloading files onto PC’s at that stage. Once that happened, iPod sales grew dramatically. The iPod was never intended to lift the flailing computer business of the parent company but overtime, Haddad statements would hold good, as the iPod would grow to become one of the most successful products ever launched by a computer company. (Haddad, Charles, iPod, You Pod, Will We All Pod? Business Week Online; 7/3/2002) Teething problems with Strategy? With the degree of success that the iPod has seen over the years, there have been few instances that writers have been able to find a chink in the armour of this hugely successful product. One such writer is Salk ever, Alex (2004). In the first of his articles – ‘Apple’s slow boat to China’, he discusses how the Chinese economy is one of the most lucrative investment decisions for businesses the world over and how Apple has failed to take advantage of this huge opportunity. He begins by using the views of consultants who have worked within the Chinese market place for decades now and seen it evolve over the years. He quotes Merrill Weingrod who works with a marketing consultancy – China Strategies. When Salk ever asks Weingrod how lucrative the Chinese market is for product such as the iPod, he answers saying that the market potential for men’s electric shavers is $300 million annually. Weingrod believed that the Chinese have the buying power to spend $200 to $250 on luxury shavers today which are not a necessity by any standing. This was just an indication of their mind-sets and how much they were willing to spend and for what. He reiterates this by stating that the Chinese population measures 300 million in terms of the number of cell phone subscribers across the country. They pay an average of $200 for their handsets and connectivity. In addition, the average Chinese employee earns far less than his / her American counterpart and yet, he / she is willing to pay larger proportion of their salary towards buying luxury goods. This equates to the buying potential and eagerness amongst the population and above all – a prospective consumer. One who is constantly on the lookout for the infusion of luxury goods into the market so that he /she can go ahead and purchase it, provided there is a need of course. In addition, the Chinese economy is the fastest growing economy in the world with its GDP growth rate pegged at 9 per cent annually. It has one of the largest middle-class societies in the world with disposable income that is growing as fast as their growth rate. With every factor in the book of marketing pointing towards the Chinese market, Salk ever is dismayed at Apple’s strategy to stay out of this market and not undertake an aggressive marketing strategy that would tap it’s he potential. The only real steps that Apple has taken towards entering this economy is to ensure that iTunes Music software is downloaded onto every Manufactured by China’s second largest computer manufacturer – Founder Technology. It is an ironical decision considering the consumer who would purchase the machine would have little access to the iPod on which he could have downloaded his / her music. Besides this decision with the Chinese industry, Apple hasn’t taken any more steps towards making any investment decisions in this region. There was one instance when they almost toyed with the idea of opening an iTunes Music Store but then retracted any steps made in that direction. The figures that Salk ever quotes are astounding to the reader. According to him, at least .3 present of the population of China has disposable income that equates to that of an individual in the US who would earn approximately $25000 to $30000 annually. That figure translates to approximately 60 million people today and will grow to 3to 4 times that number over the next decade. With the increasing middleclass and the ability to buy products that others around the world can afford, very soon the Chinese middle class would equal the entire population of the United States. So what do the Chinese see these new gadgets in the market place as? According to market analysts Bryan Mama company that tracks the buying of cell phones in Asia, but based in Singapore, the number of cell phones that are replaced are astounding. The Chinese people like to replace their cell phones 6 to 12 months earlier than consumers in North America and Western Europe. Gadgets are seen as a status symbol of sorts. Owning the latest models makes individuals feel like they are popular and wanted, according to the company. Chinese consumers also tend to go for gadgets that are sleek, suave and trendy. According to Salk ever those are the kinds of words that would define the iPod but they don’t find any place in the market. He tries to look at the picture from Apple’s perspective. As a company, Apple’s strategy is to consolidate and preserve its position in the markets that it is strong in. In the bargain, it would not look to invest in new markets such as China. In fact, Apple has a miniscule presence across the entire length and breadth of Asia. If Japan is taken out of the equation, Apple draws less than 10 per cent of total sales from this region. Naturally, it is not an area of too much interest for the moment. Whilst Apple takes a back seat to proceedings in this region, competition in the form of Sony, Motorola and Creative have made inroads into the Chinese market. As an example, Motorola entered the Chinese handset market early and in the first quarter of2004, it was proud to declare that it has achieved a market share of 40per cent. It had the first mover’s advantage introducing a technology that few others were brave enough to take into this country many years back and today it has paid off. The Chinese market is known for its penetration problems. The researcher agrees with the insights that Salk ever has provided into this untapped region and understand the problems that Apple faces in the future lest it not take steps in this direction. The level of investment required at a later date where the market is abuzz with competition would be significantly higher. It makes completes sense for companies to invest in C hina at this stage and there is no reason why Apple should not be one of them. (Salk ever, Alex, Business Week Online; 7/22/2004) In another article by Salk ever albeit on a different issue, he adopts similar stand on the problems that will plague Apple. In his article, ‘iPod: Leader, but Not Ruler’, he states that the sales figures by Apple are either over-exaggerated or are inaccurate since there isn’t enough evidence that the data being collated is validated. Apparently, data in countries in Latin America, India, South Korea, Eastern European Taiwan are difficult to validate and not easy to obtain. There are also other areas across Asia, including China where data retrieval and collation is not as accurate as it is made out to be. So when Apple boasts of global sales and achieving market shares across the world in excess of 50 per cent across the electronic market (MP3 players), they may very well be over the top. To evidence his findings, Salk ever looks at the various methods that companies use to collate market data that can be passed onto consumers and other business prospects. On one hand, they can utilise the services of US market research companies such as the NPD group that solely dedicates its efforts to the US retail economy. On the other hand, companies such as Apple can resort to asking OEM (Original Equipment Manufacturers) and component manufacturers how many pieces they are taking to the market place. Whatever may the case be, according to Salk ever, Apple doesn’t quite have accurate information omits global market share. He confirms that Apple is certainly a global leader but not dominant. This could have been a very interesting report but the only flaw with his research is that he fails to document enough evidence either through statistics or through credible sources that can allow him to judge with some level of certainty that Apple’s iPods are infect facing tough times ahead. To be fair to Salk ever though, he does introduce the subject of the growing competition of iPods outside the borders of the US from Asian electronics companies. In the coming years, cheaper labour costs of the Asian companies will allow them to create inexpensive models of the iPod and compete on price aggressively. In addition, Salk ever states that the Asian consumers who are growing to the largest consumers of entertainment products, prefer smaller sized iPods. This is not in sync with Apple’s strategy since they plan to introduce larger and heavier models of the iPod in the coming few months. And even if iPod does take the cue and invests in smaller models in time, it would have lost outing comparison to other digital music manufacturers. But Salk ever does summarise his studies by admitting the dominance of iPod within the digital market place, yet cautions against rising competition and price sensitive market in the near future. (Salk ever, Alex (2004) Business Week On line; 5/27/2004) Curzon (2005) has an equally interesting point of view. He believes that the iPod boom would not be able to sustain the success that it has experienced for much longer. His rationale is based around stock prices and other statistics that he discovers about Apple which point towards changing tide in the coming years. Curzon promotes the concept that Apple as a company is on the decline once again and encourages people to sell their shares now since they would lose money in the coming few months lest they hang onto them. He begins by mentioning the usual success stories of the company – the last 2 years have seen iPod sales rise more than twenty times from 219,000 units towards the end of 2002 to over 4 million units at the end of last year. In fact, Lehman Brothers had initially projected iPod sales to be approximately 3million units at the end of 2004. They had to revise their figures closer to the end of the year and pegged it again at 4 million units for the year 2004. Apple on the other hand clocked 4.5 million units for the year ending 2004, ahead of anybody’s expectations. Another indication of the progressive rate of success is how the number of downloads from the iTunes rose from 50 million to 200 million. Finally, the biggest turnaround statistic lies in how the company almost went bankrupt after the dotcom era a decade ago and last year, recorded sales figures in excess of $3 billion with no debt on their financial statements. What makes very interesting reading is how Ken Curzon describes the decline in the demand of iPods and correspondingly, with the parent company as well. He states that after the Christmas rush for buying iPods, in all probability consumers will not be willing to spend as much money on it. As he puts it – â€Å"Holiday shoppers are more enthusiastic about higher prices, but once the holiday season ends, they usually don’t like to spend money on products that are priced at a premium†. In keeping with the same, Curzon predicts that in the first few months of 2005, the rate at which consumers buy iPods would drop gradually at first and then, more drastically later in the year. Lehman Brothers too have declared that they expect a 14 per cent drop in sales figures over the course of the year. In another case, Curzon talks about how on one hand, the sales of iPods have certainly been increasing in conjunction with an increase in market share, but the parent company Apple has seen a decline in its market share from 2 per cent to 1.9 per cent. The ‘Apple Stores’ are an over-riding success because of the iPod and its driving consumers tithe stores. But although the number of footfalls across these stores has doubled, the number of consumers buying Apple PC’s has remained constant. Additionally, Apple’s revenue figures in comparison to other computer companies are very average. For a company that is on the biggest ride of its business life, it records a growth rate of 33 present in comparison to HP’s 29 per cent. And what makes this look more dismal according to Curzon is that the operating margins for the previous year were declared at 3.94 per cent. This was far lower in comparison to HP’s 5.2 per cent and Dell’s 8.56 per cent. (Curzon, Ken, Esquire; Mar 2005, Vol. 143 Issue 3, p112) Somehow, Curzon does shed light on certain statistics that project Apple’s performance in a questionable light but on closer observation, it appears that the facts have been manipulated to project a negative perspective to the progress of Apple. The researcher believes this tube the case since there are many individuals who constantly try and influence the market forces through published writing such as this to ultimately try and manipulate the performance of the stocks. For every negative statement that Curzon was able to highlight, there appears tube an equally positive explanation for the same. For instance, decline in market share by .1 per cent is not necessarily a negative impact on the company. It depends on the marketing strategy of the company – is it trying to move out of certain markets and invest in others. Additionally, in saturated market places such as the US, any form of product diversification would have an impact on the market share as well. So there are considerations that need to be taken before any conclusions can be made. At the same time, the researcher believed it important to include Curzon’s work since it was one of the most recent articles on the iPod that sounded warning bells and tries to get the reader to see the success story from a different perspective. So where exactly is Apple headed towards now? According to Murphy(2004), a significant contribution of Apple’s success can be attributed to the iPod and hence, any future success parameters would also be defined by the iPod. The competition amongst the computer industry is very intense with players such as Microsoft for software, Dell, HP undim for hardware and a host of other system integrators and competitive channel partners. Due to a diminishing market share as mentioned earlier of under 2 per cent, the total business worth of the company has fallen to half that of its sales revenue. The only light in this dark tunnel is the fact that the stock price at Apple has almost doubled over the past 2 years. But can the parent company depend on single product offering and expect to piggyback ride it all the way tithe bank? It’s not possible says Murphy. There will come a time in the near future when sales of iPods begin to decline, competitive forces take over with lower priced products and existing markets begin to get saturated. Some of these products would come from companies such as HP,Dell, Sony, Creative, Gateway and Rio, each offering a product that is significantly cheaper and has greater memory storage in comparison tithe iPod. For instance, Creative has launched a new product that also has a longer battery life and also has white earplugs similar to those of Apple, taking a leaf out of Apple’s trendy design. At the same time, it has been seen that consumers have complained about the lack of availability of iPods in the stores. And to make matters worse, Apple hasn’t been able to confirm a deadline by when they would be made available. Times will change gradually. As Murphy mentions – the pricing of the iPods over time will fall significantly and Apple would need to sell more and more iPods just to maintain the revenue figures. For instance, there is an assumption based on pricing that Apple would need to sell at least 20 per cent more iPods in the coming year to be able to sustain the same level of growth over the year. This should not be a problem currently considering growth is predicted to rise to 70 per cent but in time, this could certainly become an issue. If looked at differently, Murphy argues that falling prices of products are fine as long as business efficiencies were rising. 4 years ago, when the sales figures of Apple were 4 per cent higher than they are today, the operating profits of the company were at 9 per cent of total sales. Today, that figure has come down to 3 per cent. In addition, the number of employees added over the past 4 years has gone up by 32 per cent and the sale per employee has significantly decreased from $930,000 to$674,000. For apple to be able to sustain its growth and maintain a leading position in the market place, it cannot depend wholly on the iPod revolution. Its notebooks and desktop products account for 64 per cent of its current sales as a company. But except for the month of June that recorded a 14 per cent increase in revenues, the rest of the year remained much the same in terms of sales. This is worrying for Apple since it doesn’t have too many back up measures to fall on should they land in trouble. To tackle some of this problem, Apple had introduced a series of Apple stores across the US, UK and parts of Western Europe. These stores hosted the latest introductions by the company including all models of the iPod and its peripherals. The rationale lay in ensuring that consumers would walk into these stores with the excuse of looking at the iPods and at the same time, browse around and take look at the range of other Apple products as well. Unfortunately though, this move didn’t bring in the kind of sales that Apple management had predicted. When Apple was asked about this stagnancy that was creeping into their product lines, they said that 50 per cent of all buyers at their new stores that they have introduced are new consumers and they propose to build relationships through their product quality and peripherals and increase their market share of repeat buyers. Interestingly, Murphy is one of the only writers on this subject who believes that the main fault of Apple’s moderate performance lies with its CEO Steve Jobs. Over the course of its business history, Apple has always ensured that its software configures only with its hardware and no others. For instance, the Mac operating system can only be run on Mac computers. In comparison, the Windows Operating systems can be used on a variety of different hardware systems making it a more universally accepted operating system. The time for niche solutions in not the way forward. Apple must realise that the money lies in the numbers and they can in no way get to those numbers by limiting access to their software. It really is a Catch-22 situation for them. In much the same way, the iPod can only play music that has been downloaded from iTunes. What happens when the iTunes faces intense competition from other music download software companies in the near future? Are we saying that the iPod would only have limited access to music and perhaps, not the entire range of mus