Explain How External Environment Influence Essay

External environment aims to help an organisation to obtain opportunities and threats that will affect the organisation’s competitive situation. External opportunities are characteristics of the external environment that have the potential to help the organization achieve or exceed its strategic goals. External threats are characteristics of the external environment that may prevent the organization from achieving its strategic goals. Therefore, organisations must formulate appropriate strategies to take advantage of the opportunities while overcome the threats in order to achieve their strategic goals. The external environment consists of variables that are outside the organization and not typically within the short-run control of top management. They may be general forces within the macro or remote environment, which consists of political-legal, economic, socio-cultural, technological forces – usually called PEST. Political-legal force influences strategy formulation through government and law intervention. For example, the environment law requires the world’s automobile manufacturers to reduce emission of green house gasses, and therefore these manufacturers have to reformulate their product strategy. Economic force influences strategy formulation through economic growth, interest rates, exchange rates and the inflation rate. For example, exchange rates affect the costs of exporting goods and the supply and price of imported goods in an economy, and thus influence strategy formulation of exporters. Socio-cultural force is about the cultural aspects, health consciousness, population growth rate, age distribution, career attitudes and emphasis on safety. Trends in social-cultural factors affect the demand for a company’s products and how that company operates. For example, increasing health consciousness can influence strategy formulation of fast-food companies that may have to adopt product innovation strategy. Technological factors include technological aspects such as R;D activity, automation, technology incentives and the rate of technological change. For example, rapid development of the information technology has significantly influenced the strategy formulation of logistics service providers who are now able to provide superior express services. There may be specific forces within the micro or near environment, which involves analyzing the threat from the new entrant, rivalry among the existing players, pressure from the buyers, pressure from the suppliers and pressure from the substitutes. This is introduced in Porter’s Five-Forces Model. Profitable markets that yield high returns will attract new firms which eventually will decrease profitability for all firms in the industry unless the entry of new firms can be blocked by incumbents. The existing firms therefore need to formulate new strategies against potential entrants. For most industries, the intensity of competitive rivalry is the major determinant of the competitiveness of the industry. For example, high intensity of competitive rivalry in the automobile industry forces competitors such as Ford, Honda, to form strategic alliances or adopts the strategy of M;A. The bargaining power of buyers is the ability of customers to put the firm under pressure. For example, strong bargaining power of buyers in the computer industry put Dell under pressure. To deal with such pressure, Dell has to focus on relationship marketing strategy by offering value-added services to its customers. The bargaining power of suppliers is also described as the market of inputs. Suppliers of raw materials, components, labor, and services (such as expertise) to the firm can be a source of power over the firm, when there are few substitutes. Suppliers may refuse to work with the firm, or charge excessively high prices for unique resources such as Microsoft software and Intel chips which affects the formulation of price strategy of PC makers. The existence of products outside of the realm of the common product boundaries increases the propensity of customers to switch to alternatives. In order to retain customers, companies must formulate appropriate strategies to compete with the substitutes. For example, milk producers compete with soy milk producers. However, strategy formulation is also influenced by the degree of turbulence of the external environment. A high degree of turbulence exists if changeability is high and predictability is low. Companies need to formulate strategies based on the planned prescriptive approach if turbulence is low, whereas based on the unplanned emergent approach if turbulence is high. How organization’s overcome environmental changes? Organisations need to deal with environmental changes with appropriate strategies. First, organisations may choose to wait and see. Such strategy has its advantages and disadvantages. For example, facing a significant technological change, some companies may choose to integrate the new technology into their products. If they are successful, the rest companies’ ‘wait and see’ strategy is obviously unwise. However, if they failed, the rest companies’ ‘wait and see’ strategy appears wise. As a result, strategic decision making is impacted on and opportunities may either be lost or capitalised on. Second, organisations may choose to change in response to environmental changes through either proactive or reactive. Proactive change involves actively attempting to make alterations to the work place and its practices. Companies that take a proactive approach to change are often trying to avoid a potential future threat or to capitalize on a potential future opportunity. Reactive change occurs when an organization makes changes in its practices after some threat or opportunity has already occurred in the external environment. As an example of the difference, assume that a hotel executive learns about the increase in the number of Malaysians who want to travel with their pets. The hotel executive creates a plan to reserve certain rooms in many hotel locations for travelers with pets and to advertise this new amenity, even before travelers begin asking about such accommodations. This would be a proactive response to change because it was made in anticipation of customer demand. However, a reactive approach to change would occur if hotel executives had waited to enact such a change until many hotel managers had received repeated requests from guests to accommodate their pets and were denied rooms. In reality, companies may use a combination of both proactive and reactive approaches. Proactive approach is highly common when an industry is new with little or no change. The bellwether company entering the industry is making all of the strategic decisions or being proactive. However, because of its success, competitors gradually enter the market, resulting in the turbulent change of the competitive environment. Consequently, the reactive change is on the part of the new competitors as well as the bellwether company. To overcome environmental changes, companies may also choose the merger or acquisition strategy. A merger is defined as the joining of two or more organizations to constitute a new combined, legal entity. An acquisition is defined as the purchase of more than 50 percent of the voting shares of one organization by another, but the two organizations are still separate legal entities with the acquiring organization running as the parent company and another as a subsidiary. For example, recent study discloses that the merger and acquisition strategy in the global automobile industry will be further enhanced in the near future in order to deal with the threat of global financial crisis which decreased the consumers’ disposable income and increased the debt of auto makers and suppliers that have to save their organisations through merger and acquisition Ddiscuss the importance of organisational culture in strategy implementation Organisational culture can be defined â€Å"as the system of shared beliefs and values that guide and direct the behaviour of members, can have a strong influence on daily organisational behaviour and performance. † (1) Reflection to leadership Successful strategy implementation needs strategic leadership. Strategic leadership is the ability of influencing others to voluntarily make decisions that enhance prospects for the organisation’s long-term success while maintaining short-term financial stability. It includes determining the firm’s strategic direction, aligning the firm’s strategy with its culture, modelling and communicating high ethical standards, and initiating, shaping and implementing changes in the firm’s strategy, when necessary. Strategic leadership sets the firm’s direction by developing and communicating a vision of future and inspires the organization’s members to move in that direction. (2) Enable to create mission & vision The vision is the source and the main idea of a company. The mission aims to give the direction which presents the unique scope of business, its vision nd specific competence & competitive advantages, and to tell employees, consumers, and shareholder what the firm is. For example, IBM’s vision is: solutions for a small planet. Mission is: At IBM, we strive to lead in the invention, development and manufacture of the industry’s most advanced information technologies, including computer systems, sof tware, storage systems and microelectronics. Create a shared vision to manage strategic change: objectives and vision of both individuals and organization should coincide. There should be no conflict between them. Senior managers need to constantly and consistently communicate the vision not only to inform but also to overcome resistance through proper communication. Strategy implementers have to convince all those concerned that the change is not superficial. The actions taken have to be credible, highly visible and unmistakably indicative of management’s seriousness to new strategic initiatives and associated changes. (3) Help to create a better strategy (4) Staff motivation Strategy implementation requires special motivation to achieve objectives. The motivation system functions according to the qualities and mechanisms of motivation, which is developed during the stage of entry strategy preparation. First and foremost, this system has to inspire employees involved in the process of strategy development and implementation to orient their mindset toward a strategic way of thinking. Formalizing the strategic motivation system includes establishing a system of daily incentives for employees, especially those who are responsible for strategy development and implementation. The formal system is presented in a document, where all suggestions about motivation and incentives are developed and described. It includes all moral, social, and financial instruments of motivation of individual employees and groups of employees. Special recognition and awards should be given to those who go above and beyond in creating and implementing strategic ideas. (5) Increase or enhance adaptability skills How to use organisation culture to develop competitive advantages 1. Develop CA An organization that is able to maintain a positive culture is likely to enjoy many benefits. When organization members identify with the culture, the work environment tends to be more enjoyable, which boosts morale. This leads to increased levels of teamwork, sharing of information, and openness to new ideas. The resulting increased interaction among employees activates learning and continuous improvement because information flows more freely throughout the organization. Additionally, such a culture helps to attract and retain top employees. For example, Wal-Mart’s founder, Sam Walton, showed concern and respect for his employees from the company’s inception. This created an environment of trust that persists to this day. Walton also modeled the behavior that he desired from his employees, especially customer service (both to internal and external customers), by visiting his stores, meeting customers, and greeting employees by their first names. Walton also embraced and encouraged change in order to remain competitive, and developed employees by having them work in a variety of positions. Wal-Mart considers its culture the key to its success, and to this day employees continue to think about â€Å"how Sam would have done it’’ when making decisions. 2. Proactive ; reactive Today’s globally-competitive business environment has made a positive corporate culture a critical aspect of success for firms. No longer just a competitive advantage, it has become a prerequisite for success, allowing companies to attract and retain top employees. Therefore, where the culture is serving to lower morale, it is recommended that management take proactive rather than reactive steps to change the corporate culture using a top-down approach, establishing a new vision and demonstrating new behavior consistent with the revised vision. 2. Ability to change 3. Strong learning curve

Bosch company part-A project report Essay

1.1 Autumobile industry The automotive industry designs, develops, manufactures, markets and sells the world motor vehicles. In 2008, more than 70 million motor vehicles, including cars and commercial vehicles were produced worldwide. In 2007, a total of 71.9 million new automobile were sold worldwide. Around the word, there were about 806 million cars and light trucks on the road in 2007: the burn over 260 billion gallons of gasoline and diesel fuel yearly. The numbers are increasing rapidly especially in India and china. 1.2 INDIA An embryonic automotive industry started in India in the 1940s. However for the next 50 years the growth of the industry was hobbled by the socialist policies and the bureaucratic hurdles of the license. Following, the economic liberalization in India from 1991 and the gradual easing of restrictions on industry, India has seen dynamic 17% annual growth in automobile production and 30% annual growth in export of automotive components and automobiles. India produces around 2 million automobiles currently. Total turnover of the Indian automobile industry is expected to grow from USF 34 billion in 2006 to 122 billion in 2016. Tata Motors has launched Tata Nano, the cheapest car in d world at USD 2200. Indian automotive industry is contributing a significant portion to overall Indians GDP. This sector is growing and promising a lucrative future. Automotive sector also provides wide business and employment opportunities. With the liberalization of economy, the decades old monopolistic environment of the Indian automotive industry where only a handful of vehicle models were available with a long waiting list, gradually gave way to a highly competitive, complex and rapidly changing market which was not limited to domestic market alone. Today the number of vehicle models available are more than hundred and not a month goes without offerings of newer and more advanced mode. Ironically for the Indian automotive industry, the cost of technology development has increased manifold and increasing product cost has put a squeeze on profit margin affecting their ability to outsource expensive technologies. Moreover, the technologies are not so easily available from outside .Instead of giving a license or setting up joint ventures with an industry, many intentionally renowned automobile manufacturers have started production in India to take advantage of grate commercial opportunities Indian market offer. Even in the existing joint venture, the control has slowing moved into hands of MNCs. Indian automotive industry urgently needs technologies to produce fuel efficient, environmental friendly, lighter, safer and cost competitive engines, and vehicles. Advanced material and manufacturing techniques, technologies for using alternative fuels, emission abatement, fuel economy improvement, safety enhancement, engine management systems, and embedded vehicle control system are some of the areas where we must focus our efforts. 1.3 AT PRESENT, INDIA IS THE WORLD’S †¢Largest tractor and three wheel vehicle producer †¢Second largest two wheel vehicle producer †¢Fourth largest commercial vehicle producer †¢Eleventh largest passenger car producer. CHAPTER- 2 COMPANY PROFILE 2.1 BACKGROUND AND INCEPTION OF THE COMPANY BOSCH Group founded in 1886 in Germany as a workshop for precision Mechanics and Electrical engineering by Robert BOSCH Group. The BOSCH Group today is the largest automotive technology supplier in the world with a global group turnover of 47.3 billion Euros in the automotive technology, industrial technology, consumer goods and buildings technology in the fiscal 2010. Robert BOSCH Group GmbH is a widely known company the world over, with presence across six continents. It has more than 300 subsidiaries and regional companies in over 60 countries. If its sale and service partners are included, then Bosch is represented in roughly 150 countries. Bosch operates 260 manufacturing locations worldwide of these 200 are located outside Germany in Europe, North and South America, Asia, and Australia. The company employs more than 283,500 associates worldwide. The name Bosch is synonymous with innovation in automotive technology, industrial technology and consumer goods and building technology. The company is not just famous for automotive technology products like Gasoline, Chassis systems and Car electronics, it is also a pioneer in the areas of automation technology, metal technology, packaging technology, power tools, heating technology, house hold appliances, car multimedia systems and security systems. In 2010, BOSCH Group filed 3800 patent applications across the globe. The special ownership structure of the BOSCH Group guarantees financial independence and entrepreneurial freedom of the Bosch group, making it possible for the company to plan over the long–term and to undertake significant up front investments in the safeguarding of its future. 92% of the shares capital of Robert Bosch GmbH is held by Robert Bosch sifting GmbH, the charitable foundation. The slogan â€Å"Invented for Life† is part of its long tradition, through which it communicates the Group’s core competencies and vision, that includes technological leadership, modernity, dynamics, and quality and customer orientation. 2.2 ABOUT BOSCH LIMITED Bosch has been present in India for more than 80 years –first via representative office in Calcutta since 1992, and then from 1951 via its subsidiary Bosch Limited (formerly Motor Industries Company Limited) Bosch Limited (then MICO) began operations with a two man team in Chennai; its activities were importing and marketing BOSCH Group automotive products. Soon after the company set up a manufacturing plant for sparkplugs and fuel injection equipment for diesel engines in Bangalore. Bosch Limited today is the country’s largest auto component manufacturer and also one of the largest Indo-German companies in India. The BOSCH Group holds close to 71.18% stake in Bosch Limited. The company is headquartered in Bangalore with manufacturing facilities in Bangalore, Nasik, Naganathapura, Jaipur and recently-opened facility in Goa. The plants are TS 16949 and ISO 14004 Certified. Bosch Limited has its presence across automotive technology, industrial technology and consumer goods and building technology, with strength of over 11,700 associates. The company recorded a turnover of Rs. 6630 crores in 2010. The company has excellent R&D and manufacturing capabilities and a strong customer base. Its market leadership is testimony to the high quality and technology of its products. It also has a strong presence in the Indian automotive services sector. Bosch’s service network spans across 1,000 towns and cities with 5000 sales outlets and over 4,000 authorized representatives who ensure widespread availability of both products and services. Bosch Ltd: – Bosch is also represented by five other group companies in India. 1.Robert Bosch Engineering and Business Solutions Ltd: – Robert Bosch Engineering and Business Solutions Ltd., a 100% subsidiary of Robert Bosch GmbH, which is present in India since 1998, has emerged as one of the largest Bosch development centres outside Germany. It provides end to end engineering and technology solutions for all the business sectors of automotive technology, industrial technology, consumer goods and building technology. 2.Bosch Rexroth India Ltd: – Bosch Rexroth India Ltd., established in 1974 in India, serves customers through its manufacturing facilities and service centres in Ahmadabad and Bangalore. 3.Bosch Chassis Systems India Ltd: – Bosch Chassis Systems India Ltd., established in 1982 as Kalyani Brakes Limited in India, is amongst the leading manufactur ¬ers of brakes in the country. It currently manufactures a range of Hydraulic Brake Systems meeting the stringent quality norms of many leading Indian and international vehicle manufacturers. 4.Bosch Automotive Electronics India Private Ltd: – Bosch Automotive Electronics India Private Ltd. is a 100% subsidiary of Bosch Group and is engaged in the manufacture and sale of electronic devices and electronic control units. The Company is based at Naganathapura in Bangalore. 5.Bosch Electrical Drives India Private Ltd: – Bosch Electrical Drives India Private Ltd. is a joint venture company. It drives for various automotive applications such as window lift drive, wiper system, engine cooling fans etc. Robert Bosch Worldwide The Bosch Group is one of the world’s biggest private industrial corporations. Headquartered in Stuttgart, Germany, the Bosch Group has some 280,000 Executives worldwide, and generated annual sales revenue of 38.2 billion Euros in 2009. There are about 300 subsidiary and regional companies around the world. History of Bosch †¢1886 Opening of Workshop for Precision Mechanics and Electrical Engineering in Stuttgart on 15 November †¢1887 First low-voltage magneto from Bosch for stationary petrol engines †¢1897 First low-voltage magneto ignition for motor vehicle internal combustion engines †¢1901 First plant in Stuttgart †¢1902 First commercially viable high-voltage spark plug †¢1906 Production of 100,000th magneto ignition †¢1906 Introduction of eight-hour working day †¢1910 Opening of plant in Stuttgart-Feuerbach †¢1913 Start of production of headlights †¢1918 American assets seized; later become American Bosch Magneto †¢1926 Start of production of windscreen wipers †¢1927 First diesel fuel injection pump †¢1929 First TV Set from Fernseh AG division †¢1932 Formation of Junkers & Co. †¢1932 First power drill from Bosch †¢1932 First Blaupunkt car audio †¢1936 First diesel fuel injection pump for passenger cars, such as the Mercedes-Benz 260D †¢1942 Death of the company founder Robert Bosch on 12 March †¢1962 Worcester Bosch Group opens in England †¢1964 Robert Bosch Foundation †¢1970 Company headquarter moves to Gerlingen †¢1976 First oxygen sensors †¢1978 Worldwide first Anti-lock Braking System (ABS) †¢1979 First electronic engine management system (Motronic) †¢1982 Company acquires photographic equipment division from Braun AG †¢1986 Traction control system (TCS) on the market †¢1995 Acquisition of Atco-Qualcast Ltd †¢1995 First Electronic Stability Control – Electronic Stability Program (ESP ®) †¢1997 Common rail diesel fuel injection †¢2000 DI-Motronic gasoline direct injection system †¢2003 Acquisition of Buderus AG †¢2003 Digital car radio with MP3 drive and digital recorder (Blaupunkt) †¢2003 The formation of the Robert Bosch Tool Corporation and acquisition of S-B Power Tool Corporation and Vermont American Corporation including the brand names for Bosch Power Tools, Skill Power Tools, Dremel, Vermont-American, Primark brands, and Gilmours †¢2004 Third-generation common rail diesel injection for cars, with piezo injectors †¢2004 Bosch opens new Technology Center in Abstatt †¢2006 Bosch acquires Telex Communications, a maker of hearing aids, headsets and audio equipment, and partners with Daewoo to build Bosch refrigerators in Mexico †¢2007 The Bosch Communications Systems business unit is created to manage the brands and products of former Telex Communications †¢2008 Tata Nano, the $2,500 People’s Car powered by Bosch-designed engine is unveiled at Auto Expo in New Delhi. Bosch plans to acquire majority stake in Ersol photovoltaic’s. †¢2009 Bosch acquires LR Nelson, a maker of lawn and garden products, including ponds, and merges the Gilmour’s and Nelson brands into Bosch – Garden and Watering. †¢2009 Manufacture of Electronic Control Unit and Anti lock Brake System. †¢2010 Bosch started production of predictive emergency braking system, which alert of emergencies & automatically applies brakes if needed †¢2010 Launch of A4000 pump meeting BS3 norms of commercial vehicles in India 2.3 NATURE OF BUSINESS CARRIED Automotive Technology Business divisions: Diesel and Gasoline Fuel Injection Systems, Car Multimedia Systems, Auto Electricals and Accessories, Starters and Generators, Energy and Body Systems. Industrial Technology Business divisions: Packaging Machines, Special Purpose Machines, Solar Energy Consumer Goods and Building Technology Business divisions: Power Tools, Security Systems 2.4 BOSCH VISION Creating Value – Sharing Values As a leading technology and services company, we take advantage of Bosch global opportunities for a strong and meaningful development. Bosch ambition is to enhance the quality of life with solutions that are both innovative and beneficial. We focus on Bosch core competencies in automotive and industrial technologies as well as in products and services for professional and private use. We strive for sustained economic success and a leading market position in all that we do. Entrepreneurial freedom and financial independence allow Bosch actions to be guided by a long-term perspective. In the spirit of Bosch founder, we particularly demonstrate social and environmental responsibility – wherever we do business. Bosch customers choose us for Bosch innovative strength and efficiency, for Bosch reliability and quality of work. Bosch organizational structures, processes, and leadership tools are clear and effective, and support the requirements of Bosch various businesses. We act according to common principles. We are strongly determined to jointly achieve the goals we have agreed upon. As associates worldwide, we feel a special bond in the values we live by – day for day. The diversity of Bosch cultures is a source of additional strength. We experience Bosch task as challenging, we are dedicated to our work, and we are proud to be part of Bosch. 2.4.1 BOSCH MISSION BeQIK – Be Better, Be Bosch – Profit secures our growth †¢Quality †¢Innovation †¢Customer Orientation BeQIK gives us the bearing for our actions. Our objective is to continuously improve all our internal processes – so that growth and economic success can be secured in the long term. BeQIK †¢Quality is our most valued asset †¢Innovation today ensures businesses tomorrow †¢Customer orientation inspires customers and associates BeBetter †¢We want continuous improvement †¢We want to be better than our competitors BeBosch †¢We offer outstanding products and services worldwide †¢We keep our promises 2.4.2 QUALITY POLICY †¢We strive to exceed the expectations of our customers by offering products and services of high quality standards. †¢Quality encompasses our assets throughout their life cycle, and our initiatives towards environmental protection and safety. †¢We effectively deploy methods and told to provide cost effective solutions to meet our quality objectives. †¢We involve our business partners in our endeavor towards improvements across the supply chain. Quality Principles †¢Our goal is to fully satisfy our customer’s expectations through our quality of our products and services. †¢Quality and quality improvements is every associate’s responsibility and ultimate goal from our board of directors to their apprentices. †¢Our directives, processes, systems and goals are based on requirements from international standards, consumer’s expectation, our knowledge and experience. Knowledge of and compliance with these directives and processes in the foundation of our quality. †¢Quality means doing right in the beginning thus preventing failures in the end. Continues improvements for quality of processes lowers costs and improves productivity. †¢Avoiding failure is more important that eliminating defects. We systematically apply methods and tools, preventive quality assurance systematically, learn from mistakes and prevent their root causes without delays. †¢Our suppliers contribute systematically to the quality of our products and services. Therefore our suppliers have to live up to standards we have adopted. 2.5 PRODUCT/SERVICE PROFILE Product Range A. Automotive Technology – Robert Bosch Diesel Systems †¢Common Rail System for passenger cars, commercial vehicles & off-highway vehicles †¢Axial Distribution injection pumps †¢Multi Cylinder Inline Injection Pumps (PE) †¢Single-Cylinder Injection Pumps (PF) †¢Elements †¢Delivery Values (DV) †¢Governors †¢Injection Timers for PE pumps †¢Fuel Filter & Water Separators †¢Glow Equipment †¢Electronic Control Unit Gasoline system †¢Electronic Control Unit †¢Fuel Injectors †¢Lambda Sensors †¢Engine Speed Sensors †¢Knock Sensors †¢Hot Film Air Mass Meter †¢Pressure Regulators †¢CVT Belts †¢Connectors & other plastic parts Starters & Generators (Auto Electrical) †¢Starter Motors †¢Generators Spark Plugs †¢Spark plugs for 2, 3 and 4 wheelers and industrial applications †¢Long Life Plugs :Nickel Yttrium & Twin Electrode Test Equipment & Diagnostics †¢Fuel Injection Pump Calibration Test Benches †¢Nozzle Tester †¢Auto Electrical Test Bench †¢Diagnostic Tool : KTS series †¢Engine Analyzer : FSA series †¢Engine Analyzer : BEA series †¢Chassis System Check †¢Battery Service Equipment †¢Wide range of service tools for unit & vehicle repairs †¢Software / Teach ware : ESI ( tronic ), MSI, K-CD B. Industrial Technology Industrial Equipment †¢Special Purpose Metal Cutting / Grinding / Honing / Lapping/ Super Finishing machines. †¢Semi / Fully Automatic Assembly Machines †¢Semi / Fully Automatic Inspection & Measuring Equipment †¢Cleaning Machines †¢Electro-Chemical Machines †¢Tools, Gauges & Fixtures †¢Exhaust Gas Re-circulating Unit (EGR) †¢Test Equipment Bosch Packaging Machines †¢Vertical Form Fill & Seal Machines †¢Dosing System – Cup Filler, Auger Filler, Weighed & Pump †¢Pharmaceutical Packaging Machines †¢Confectionary Processing & Packaging Machines C. Consumer Goods & Building Technology Bosch Power Tools †¢Construction Tools †¢Wood Working Tools †¢Metal Working Tools †¢Cordless Tools †¢Do- It Yourself Tools †¢Lawn & Garden Tools †¢High Pressure Water Jets †¢Specialty Tools †¢Pneumatic Tools †¢High Frequency Tools †¢Automation Technology †¢Accessories for all Tools †¢Fischer Fixing System Bosch Security Systems †¢Fire Detection †¢Intrusion Detection System †¢CCTV Surveillance †¢Access Control †¢Integrated Security Management & BIS †¢Public Address & Emergency Sound System 2.6 AREA OF OPERATION The Bosch Group is one of the world’s biggest private industrial corporations. Headquartered at Stuttgart, Germany. There are about 300 subsidiary and regional companies around the world. In India, Bosch is a leading supplier of technology and services, and has a strong presence in the country at numerous locations in diverse industry segments. Bosch Limited is India’s largest auto component manufacturer and also one of the largest Indo – German company in India. Bosch Limited has a strong nationwide service network which spans across 1,000 towns and cities with over 4,000 authorized representations to ensure widespread availability of both products and services. The company is headquartered in Bangalore with manufacturing facilities at Bangalore, Naganathapura (near Bangalore), Nasik, Jaipur and Goa. Number of Branches in India Bosch manufacturing facilities are located in Bangalore with state of the art plants in Bangalore, Naganathapura, Nasik, Jaipur and Goa. All the 5 plants are TS 16949 and ISO certified. Bangalore Plant Manufactures multi cylinder, PE pumps, mechanical governors, elements, delivery valves, special purpose machines, packaging machines, power tools and will foray into the production of common rail pumps from 2006 onwards. Built areas 109.948m2 Land area 311.140m2 Employees more than 5500 Nagnathapura Plant RBIN (Bosch Ltd. India) Naganathapura Plant, inaugurated in the year 1990, is the 3rd plant among the 4 plant of RBIN. The plant houses productions hangars for Spark Plugs, Glow Equipment, Starter Motors, Alternators, Regulators and PF Pumps. Portions of the plant are leased out to RBAI and Bosch Training Center. Built area 47.494m2 Land area 266.100m2 Employees more than 1279 Nasik Plant Set up in 1969 is specialized in manufacture of clinical and Euro series of nozzles and injectors to automobile industries recently the Nasik Plant has ventured into the production of CRI ports catapulted by Bosch Endeavour in common rail technology. Built area 67617m Land area 405.060m2 Employees more than 2500 Jaipur Plant Set up in 1999 the Jaipur plant manufactures BE (Mechanical) pumps for domestic market and export purpose. The VE pump (Distributor fuel injection pump) is designed to meet Bharat state 11 & Euro 11 emission norms. These pumps are used in 3-6 cylinder vehicles. Built area 16345m2 Land area 202350m2 Employees more than 1200 COUNTRIES COVERED Middle-East and Africa (UAE, EGYPT, KENYA), Neighboring countries (Sri Lanka, Bangladesh,) South East Asia (Philippines, Thailand, Indonesia). 2.7 OWNERSHIP PATTERN Since 1964, Bosch’s majority shareholder has been Robert Bosch Stiftung GmbH, a charitable foundation. The Stiftung carries on the charitable and social endeavors of the company’s founder in contemporary form. It sees itself as a foundation that pursues its objectives both with programs and institutions of its own, and by supporting suitable projects and initiatives proposed by others for tackling the tasks faced by society. Today, the Robert Bosch Stiftung, a charitable foundation, holds a 92 percent stake in the share capital of Robert Bosch GmbH. The share dividend received by the foundation is used exclusively for charitable purposes, i.e. to support general medical care, international understanding, social work, training and education. 2.8 COMPETITORS INFORMATION †¢Modi Champion †¢Delphi †¢Denso †¢Doowon †¢Electrex †¢Nippon †¢NGK †¢Siemens VDO †¢Zexel †¢Cav England †¢Lucas †¢TVS 2.9 INFRASTRUCTURAL FACILITIES Bosch infrastructure is one of the best in the country. The individual work place is designed as per the international standards which make the employees feel comfortable, proud, happy and safe. Medical Facilities †¢Medical centre works round the clock and also provides a 24 hours ambulance service †¢The company has also associated with important hospitals, labs and senior medical consultants in the city for the treatment of the employees †¢They are provided with annual master health check-up †¢Special schemes like hospitalization scheme, Manipal hospital scheme and Medical reimbursement scheme are provided to the employees Canteen Facilities †¢Food is provided to all the employees and 24hrs a day providing breakfast, lunch, dinner, tea/coffee and snacks for 8500 employees in 4 shifts. †¢It is well equipped and accommodation for more than 1500 persons at a time †¢The food provided in the organization is 100% hygiene. Workings of the canteen is guided by an advisory committee Transportation Facilities †¢The company provides transport facilities for employees Library Facilities †¢The company has the facility of both general and technical library The general library is used by the project trainees also Other Facilities †¢Sports club †¢Fine Arts Society looks into the cultural events and various programmes conducted during the course of the year. †¢Uniform, shoes, socks and soap is given to employees on the job by Bosch. †¢Accident benefit scheme †¢Holiday homes and time share holidays †¢Vehicle expenses and reimbursement †¢Death relief scheme. 2.10 ACHIEVEMENTS/AWARD February 1, 2012: Bosch Limited wins Car & Bike Award 2012 The accolades and awards keep rolling in for Bosch Limited. Once again, Bosch Limited was the proud winner of the Subros Car & Bike Award 2012 in the â€Å"Best Automotive Component Manufacturer† category. Bosch Wins â€Å"Car & Bike† Award 2011 Receiving yet another glory in its 125th Anniversary Year, Bosch Limited was conferred with the Car & Bike India Award in â€Å"Best Auto Component Manufacturer† category. The Car & Bike Award function was held at Mumbai on January 13, 2011. Bosch was adjudged the best among two other nominees, namely Delphi and Endurance. Jan. 07, 2010: NDTV Car & Bike Award – ‘Automotive technology of the year’ This accolade recognizes the contributions made by Bosch in India, for localizing ABS (Antilock Braking System) production. Bosch is the only automotive supplier to manufacture ABS in India for passenger cars and light commercial vehicles. ABS is crucial to safety while driving, as it makes braking safer, by preventing the wheels from locking. April 15, 2009: DHL – CNBC TV18 International Trade Award Bosch won this honor in the category of auto component industry, for doing extremely well in exports through its low-cost solutions. The award recognizes the company’s commitment and innovations that address the needs of the Indian market, and keep Brand India alive. Feb. 20, 2009: NDTV Car & Bike Award – ‘Auto component manufacturer of the year 2009’ Bosch was chosen as the best in the auto component industry of India for the year 2009. These awards are considered as benchmarks for auto excellence in India and widely trusted by consumers, manufacturers and auto experts alike. The award recognizes the best in the automobile industry of India. Jan. 7, 2009: UTVi Autocar Award Bosch and Mahindra & Mahindra won the ‘Best Innovation of the Year’ UTVi Autocar Award. The award recognizes Bosch innovation start/stop system which contributes to fuel efficiency at a very reasonable cost. The Mahindra Bolero Micro Hybrid is the first vehicle in India to integrate this technology in their new car. June 21, 2008: Business Standard Award ‘Star MNC of the year’ Bosch was noted for its cutting edge technologies, especially for designing and delivering low cost high quality fuel injection system and for pioneering the common rail system in India. Jan. 10, 2008: NDTV Car & Bike Award – ‘Car Technology of the year’ Bosch not only setup the common rail injector and pump manufacturing projects in record time, but also pioneered the new application of Common Rail in low cost car segment. This is a revolutionary leap achieved by Bosch in India, which is the pioneer of Common Rail technology in the rest of the world as well. Jan, 12, 2007: NDTV Profit Car & Bike Award 2007 – ‘Automotive Technology of the year’’ Audited by PricewaterhouseCoopers, these awards honored the best in the Indian automotive industry for their handiwork in calendar year 2006. Bosch was presented with the award for its application of ABS / ESP technology. Jan. 4, 2007: CNBC-TV18 Autocar Auto Award – ‘Auto Component manufacturer of the year’ Bosch Limited was chosen for the mark that it has made both in the domestic and international markets with its superior technology and products. These awards seek to reward exemplary performance in the industry in 2006 based on a comprehensive set of attributes including design, technology, value, product experience and so on. The selection process truly reflects the choices and sentiments of all stakeholders and justifies their stature as benchmarks in auto excellence. Aug. 17, 2006: Dun & Bradstreet American Express Corporate Award -–‘Top Indian company in the Auto Components sector’ The award recognizes the twin virtues of size and growth in the organizations of corporate India, from a derived list of top 500 companies in the country. Bosch Limited was selected as the best amongst the top 10 auto component manufacturers in India. Aug. 10, 2006: EEPC Award – ‘Star Performer for outstanding export performance’ The Engineering Export Promotion Council (EEPC) conferred the ‘‘tar Performer’’for outstanding export performance in the large enterprises category on Bosch Ltd, which garnered a total export figure of Rs 423 crores in 2005, almost twice as high as Rs 193 crores in 2001. Jan. 12, 2006: NDTV Profit Car India Award – ‘Safety & Technology Award’ Bosch was presented with this award for its pioneering work on the new age direct injection diesel fueling systems, with notable emphasis in the range of common rail diesels. Also taken into account was the persistent focus on unit injector systems which are entering the scene in the high profile high aspiration D-segment cars. The jury considered not just the technology but its bearing on safety, and the benefits it brought to automotive users as well as the potential it has for India. Jan. 8, 2005: Overdrive–Auto Monitor Award – ‘Auto component manufacturer of the year’ Recognized for innovations in technology and the scale and size of manufacturing capabilities, the award also commemorated the customer satisfaction earned by Bosch over the years, performance, quality and diverse range of products. This Annual Award is the â€Å"Oscar† for the automobile industry in India and recognizes the â€Å"best† in the industry in association with reputed industry bodies like CII, SIAM & ACMA. 2.11 WORK FLOW MODEL The work flow model of Bosch can be interpreted in two phases †¢Information flow †¢Material flow Bosch believes in the concept of â€Å"customer is king† this is depicted in the workflow model which starts with customer signifying the pull system of production (i.e. production against customer order). Sales and marketing department receives purchase order from the customer. R&D division takes decision with respect to product design and specification. Engineering wing analyses the order and decides upon in house manufacturing or outsourcing. The next step is to procure the component and assembling the final product, or acquire raw materials and convert it into finished product. Finally dispatch the end product to logistics department, which is entrusted with the responsibility of transit of consignment to the ultimate consumer. 2.12 FUTURE GROWTH AND PROSPECTS The auto component industry appears to have a bright future with the existing manufacturing planning and capacity and in addition moreover new plants are being setup with foreign collaboration. The Indian auto component industry is highly fragmented with over 3000 players in organized sector and estimated 500 units in the small sector. Vocationally the industry has developed major vehicle manufacturing centers. Small and medium enterprise sector is keen on taking a number of technology investment initiatives in order to become self reliant and globally competitiveness according to a confederation of Indian Industry survey report on auto component. The survey reveals that Indian small scale enterprises manufacturing auto components are well equipped to produce components as per international standards. These SMEs have now started talking strategic positions in the international markets at both the original equipment manufacturers and the replacement supply. The last few months have seen a virtual boom in the Indian automobile industry with not only domestic component manufacturing shares but also the formidable biggies also entering India in such a manner that it is increasingly turning out to be a lucrative destination for many companies. The other growth plans are †¢Focus on strengthening or engineering competencies and infrastructure in new product lines. †¢Focus on securing liquidity position. †¢Cost reduction without hurting the long term interest of the business. †¢Import substitution projects. †¢Continuous improvement activities and implementing lean practices through Bosch Production System (BPS), continue with redesign of HR policies and practices to attract, retain and motivate employee. CHAPTER – 3 MCKINSEYS’S 7S FRAMEWORK 3.1 STRATEGY Strategy is the systematic action allocation of resources to achieve company goals. A strategy is defined as â€Å"a coherent set of action aimed at gaining a sustainable advantage over competitors by improving the market position and effective allocation of resources vice versa. Hr Strategy It pays special attention to competence management and filling up of executive positions in growth regions, special entry programs to attract qualified university graduates and applicants with professional experience. Train and develop the younger generation of apprentices/ engineers who are the future skilled technicians and managers. Corporate Strategy Bosch economic strategy corresponds to a common aim of the group for innovation, independence and integrity. The aim is to be among the world market leaders and to be a major player in all of the company business sectors. The strategy to achieve this goal is by strong marketing of new products and ongoing investment in Research and Development to innovate continuously. The emphasis on innovation is underlined by huge number of associates, working in Research and Development departments, 21250 world wide. Efficient sales and customer service also play a key role in Bosch’s corporate strategy. Innovation Bosch shall focus their innovative strength on technology that is â€Å"INVENTED FOR LIFE.† Bosch has invested heavily in R&D much above the industry average. This has resulted in Bosch pioneering many technological advances †¢Anti-locking braking systems †¢Electronic stability control †¢High pressure diesel injection †¢Parking assist systems 3.2 STRUCTURE The design of organization structure is a critical task to the top management of an organization. It is the selection of the whole organization edifice. Organization structure refers to the relatively more durable organizational arrangements and relationships. It prescribes the formal relationship, how an organizational member’s procedure exists. To guide the various activities performed by the member of all part of the organization. 3.3 SYSTEM System refers to formal process and procedures use to manage the organization including the management control system performance management measurement and reward system, information system and distribution. Human Resource The HR organization uses its human resources strategy to support the divisions in the pursuit of their objectives. This involves the consistent application of the balanced scorecard. This method is used by executives. The HR organization’s missions are based on the House of Orientation and contribute to closer alignment with the strategic objectives of the company. The â€Å"House of Orientation† provides a frame of reference for Bosch long term road map and for the way Bosch works together. It is based on Bosch values and core competencies. Environment Management Bosch has been expanding the environment management systems at Bosch sites since 1996. Now, the 300 sites have been certified to ISO 14001. Bosch implemented a maturity model for all manufacturing and developing sites, which will serve as the basis for further improvements in environmental protection, occupational safety and fire safety. Occupational Safety Management Bosch implemented a new occupational safety management system based on the globally recognized OHSAS 18001 standard. One of the systems main functions is to detest potential accident and health risks for associates in order to take appropriate preventive measures in good time. The new system is to be implemented at all manufacturing sites in no more than two years. This makes Bosch one of the forerunners in global implementation of the OHSAS 18001 standard. Bosch Production System (Bps) It was installed in 2002. It is a systematic production system in Bosch. In general it is called as Lean manufacturing. Just in Time (JIT) is one of the systems in Bosch production. In this the right parts produced at the right quantity should reach the assembly time at the right time. Approaches in Bosch Production System †¢The right part †¢In the right quantity †¢In the right quality †¢At the right cost †¢At the right time †¢At the right place Quick Response System (Qrs) System designed to respond quickly to any problem/issues in the production. Example – Every system has three machine indicators: Red (machine breakdown), Yellow (shortage of materials), and Green (process completed for that machine) 3.4 STYLE Style is the leadership approach in the top management and the company’s overall operating approach. Style impacts the norms that the people follow and how they work and interact with each other and the customers. The leadership style depends upon the organization culture that is in practice. Bosch Ltd has participative kind of leadership style where in the leader consult with the subordinate, a proposed action, decision and encourages, ensures equal participation among them. The style adopted by the management is to maintain a friendly and collaborative environment for smooth running of the organization. Bosch Guidelines for Leadership 1. Aim for success: – Profit, growth, quality, customer and process orientation. These are the key metrics with which our corporate objectives are aligned. Regularly communicate these objectives to your associates. Make it clear what each individual can contribute to achieve it. 2. Demonstrate initiative: – Together with your associates, generate new ideas and strategies that make our company stronger. Encourage them to embrace change and take initiative on their own and support them in the implementation. 3. Demonstrate courage: – Stand by your associates. Make clear decisions and demonstrate determination in implementing them. Be a role model and exemplify the Bosch values. 4. Keep your associates informed: – Of course you give your associates factual information. They should also know the business context and background – they are an important prerequisite for identification with the company. 5. Lead by goals: – Delegate tasks and give your associates the authority to perform them. Agree on clear goals and allow sufficient space so that creativity, self-confidence, and accountability can be developed. This enables you to lead your associates to success. 6. Give feedback to your associates: – Recognize the strengths of your associates and help them to utilize and further develop them. Take a close look: praise your people where praise is due, but also give fair and constructive criticism. Mistakes happen on both sides. Be quick and open in addressing them with the associate. 7. Trust your associates: – They are capable and willing to perform. Have the courage to manage with limited control. Your trust will create the entrepreneurial momentum that all of us want. 8. Shift your perspective: – Put yourself in your associates’ position and also look at things from their point of view. How would you react to the decisions you have taken as their supervisor, and what rationale would you expect to hear. 9. Shape the future together: – Your associates can and do contribute to our company. Integrate them into the preparation of decisions and capitalize on the ideas and the potential that the cultural diversity of our company offers. Work together with your associates to transform mere interfaces into connection points, and barriers into opportunities. 10. Develop your associates: – Advise and systematically support your associates in their professional development. Support them if there are suitable opportunities for, or if they desire, further development somewhere else in the company. 3.5 STAFF The staff at Bosch Ltd is considered as a pool of resources to be nurtured, developed, guarded and allocated. There are about 3650 employees in the organization. Permanent employees are 2550, temporary employees are 500, on job trainees are 600. Levels at Bosch Ltd – MANAGEMENT AND SUPERINTENDENT STAFF †¢GM – General Manager †¢DGM – Deputy General Manager †¢Gr.1 – Senior Manager †¢Gr.2 – Manager †¢Gr.3 – Deputy Manager †¢Gr.4 – Assistant Manager †¢Gr.5 – Senior Engineer †¢Gr.6 – Officer †¢Gr.7 – Assistant Officer Managerial And Supervisory Staff (M&Ss) Managerial and Supervisory Staff refers to a salaried professional or an educated worker who performs semi-professional office, administrative and sales co-ordination task. They are board occupational grouping of workers engaged in non-manual labor. Blue Coloured Associates (Bca) A blue collared associate is a member of the working class who typically performs manual labor and earns an hourly wage. Blue collared associates work may be skilled or unskilled and may involve manufacturing, mechanical work, maintenance repair and operations maintenance of technical installations. 3.6 SKILLS There are 6 different skill groups within the skills framework. Community leadership skills, leadership skills, management skills, occupational/technical/ professional skills, core skills, skills for life. The other skills groups are †¢GENERIC SKILLS are those which should be possessed by each and every employee in order to carry out the task successfully. Skills like problem solving, decision making and communication form the basic important generic skills. †¢SPECIFIC SKILLS are those which should be possessed by the employee to carry out his/her assigned specific task. Example: Time management, shop floor management, building teams, leadership and motivation, creativity, industrial safety and environment. BOSCH SKILLS – The employees according to the nature of the jobs posses following skills †¢Functional †¢Quality †¢Information Technologies †¢Behavioural/ Human Relations Managerial 3.7 SHARED VALUES – BOSCH VALUES Bosch Values are those values which are applied and followed by all Executives faithfully. †¢Future and result focus: – In order to ensure dynamic development of our country and to guarantee long term corporate success, we participate in shaping the changes in markets and technologies. †¢Responsibility – We accept that our actions must accord with interests of society. †¢Initiative and determination – We act on our own initiative, with an entrepreneurial but accountable spirit, and demonstrate determination in pursuing our goals. †¢Openness and Trust – We inform our associates, business partners and investors in a timely and open fashion of important development within our company. †¢Fairness – We view mutual fairness as a condition of our corporate success when dealing with each other and with or business partners. †¢Reliability, credibility, and legality – We promise only what we can deliver accept agreements as binding and respect and observe the law in all our business transactions. †¢Cultural diversity – We are aware of our company’s regional and cultural origins and at the same time regard diversity as an asset as well as a precondition of or global success. CHAPTER – 4 SWOT ANALYSIS 4.1 STRENGTHS †¢High customer satisfaction. †¢Established brand image around the world over the centuries. †¢Continuous improvement of products and quality. †¢Employee development given at most important. †¢Cost reduction strategy is good. †¢Good infrastructure facility. †¢Leadership through innovation. †¢High employee morale. †¢Effective decision making, information sharing and authority distribution. †¢Less employee turnover. †¢High quality and eco-friendly products. 4.2 WEAKNESS †¢Experience and skilled employees are not in right position because of ineffective allocation. †¢Decision making will be delayed because of long procedure. †¢In certain situations centralized management is followed. †¢Marketing of products is given less importance. †¢Adaptability towards change is low. †¢No diversification of business. 4.3 OPPORTUNITIES †¢Continuous innovation of products. †¢Bosch can foray into other line of business as it has a good brand image. †¢It can produce new machineries using high technology. †¢Potential to grow in power tools, packaging and security systems. †¢It can produce more economical and eco-friendly products. †¢It helps to compete with other companies †¢Quick cost effective adaptation of product to market requirement of Indian market. 4.4 THREATS †¢Increase in competition. †¢Too many substitute products available in the market. †¢Brand image being diluted due to entering into many products. †¢Growing bargaining power of companies. †¢Continuous cost pressure. 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Capital Budgeting

Are there any similarities between a firm’s capital budgeting decisions and an individual’s investment decisions? Capital budgeting is the process of analyzing potential additions to fixed assets. Capital budgeting is very important to firm’s future because of the fixed asset investment decisions chart a company’s course for the future. The firm’s capital budgeting process is very much same as those of individual’s investment decisions. There are some steps involved. First, estimate the cash flows such as interest and maturity value or dividends in the case of bonds and stocks, operating cash flows in the case of capital projects. Second is to assess the riskiness of the cash flows. Next, determine the appropriate discount rate, based on the riskiness of the cash flows and the general level of interest rates. This is called project’s required rate of return or cost of capital in capital budgeting. Then, find the PV of expected cash flows and the asset’s rate of return. If the PV of the inflows is greater than PV of outflows (NPV is positive), or if the calculated rate of return (IRR) is higher than the project cost of capital, accept the project. Question b What is the difference between independent and mutually exclusive projects? Between normal and non-normal projects? Independent projects mean a company can select one or both of the projects as long as they meet minimum profitability. This is because the projects do not compete with the firm’s resources. Projects are independent if the cash flows of one are not affected by the acceptance of the other. Mutually exclusive projects mean if acceptance of one impacts adversely the cash flows of the other which is firm can select one or another project but not both. This is because projects investments that compete in some way for a company’s resources. When projects are mutually exclusive it means that they do the same job. Normal projects have outflows, or costs, in the first year (or years) followed by a series of inflows. Non-normal projects have one or more outflows after the inflow stream has begun. So, we can conclude that the lower the WACC, the higher the value of NPV. Question d 1) Define the term internal rate of return (IRR). What is each project’s IRR? Internal rate of return (IRR) is the discount rate that will equate the present value of the outflows with the present value of the inflows. The IRR is the intrinsic rate of return. By using financial calculator, the IRR for project L is 18. 13% while the IRR for project S is 23. 56%. 2) How is the IRR on a project related to the YTM on a bond? A project’s IRR is the discount rate that forces the PV of the inflows to equal the cost. This is equivalent to forcing the NPV to equal zero. The IRR is the estimate of the project’s rate of return, and it is comparable to the YTM on a bond. 3) What is the logic behind IRR method? According to IRR, which project should be accepted if they are independent? Mutually exclusive? The logic behind IRR method is; if the IRR is more than WACC, the project will be accepted, but the project would be rejected if the NPV is less than WACC. IRR that equal to WACC means it is technically indifference whether we accept or not the project, will not gain any benefit or loss. According to IRR, both projects can be accepted if they are independent because the IRR for both project have percentage more than the percentage of WACC. But, if they are mutually exclusive, only one project that should be accepted that is project S. This is because the IRR for project S is 23. 56% and it is higher compared to the IRR for project L which only 18. 13%. 4) Would the projects’ IRR change if the WACC changed? No, the IRR would not change if the WACC changed. Question e 1) What is the underlying cause of ranking conflicts between NPV and IRR? In the normal project for the NPV profiles to cross one project must have both a higher vertical axis intercept and a steeper slope than the other. A project’s vertical axis typically depends on the size of the project and the size and timing pattern of the cash flows. For example, for the large projects and with large distant cash flows would expect to have relatively high vertical axis intercepts. The slope of the NPV profile depends entirely on the timing pattern of the cash flows. The long-term projects have steeper NPV profiles compared with short-term projects. So, NPV can only cross in two situations which is when mutually exclusive projects differ in scale or size and when the projects’ cash flows differ in terms of the timing pattern of their cash flows (Project L and S). 2) What is the â€Å"reinvestment rate assumption†, and how does it affect the NPV versus IRR conflict? The underlying cause of ranking conflict is the reinvestment rate assumption. All DCF methods assume that cash flows can be reinvested at some rate. This applies to Project L and S. When we calculated their NPV, we discounted at WACC, 10% which means that we assuming that their cash flows could be reinvested at 10%. IRR assumes that cash flows are reinvested at the IRR. Discounting is the reverse of compounding. Compounding assumes reinvestment and also for the discounting. NPV and IRR are both found by discounting, so they both assume some discount rate. NPV calculation is the assumption that cash flows can be reinvested at the project’s cost of capital while the IRR calculation assumes reinvestment at the IRR rate. 3) Which method is the best? Why? The NPV tells us how much a project contributes to shareholder wealth. The larger the NPV, the more value the project adds, and added value means a higher stock price. Thus NPV is the best selection criteria. A project IRR is the discount rate that forces the PV of the inflows to equal the cost. This is equivalent to forcing the NPV to equal zero. However, NPV or IRR give better ranking is depends on which has the better reinvestment rate assumption. NPV is selected because it used as a substitutes for outside capital hence save the firm cost of outside capital. For most firms, assuming reinvestment at the WACC is more reasonable for the following reasons. If a firm has reasonably good access to the capital markets, it can raise all the capital it needs at the going rate, which in our example is 10%. Since the firm can obtain capital at 10%, if it have investment opportunities with positive NPV, it should take them on and it can finance them at a 10% cost. If a firm uses internally generated cash flows from past periods rather than external capital, this will save it the 10% cost of capital. Thus, 10% is the opportunity cost of the cash flows, and that is the effective return on reinvested funds. However, NPV and IRR usually give the same results to accept or reject the project for independent project. NPV and IRR occurs conflict only when mutually exclusive projects are involved. Question f 1) What is the difference between the regular and discounted payback methods? Payback period is defined as the number of years required to recover the funds invested in a project from its operating cash flows. Discounted payback is the length of time required for an investment’s cash flows, discounted at the investment’s cost of capital to cover its cost. Actually, discounted payback is similar to regular payback except that discounted rather than the raw cash flows are used. 2) What are the two main disadvantages of discounted payback? Is the payback method of any real usefulness in capital budgeting decisions? Discounted payback does consider the time value of money, but it still disregard cash flows beyond the payback period, which is a serious flaw. For example, if mutually exclusive projects vary in size, both payback method can conflict with the NPV, which might lead to a poor choice. However, many firms still use the payback to do the capital budgeting decisions. Payback and discounted payback used as a measure of project’s liquidity and risk. The shorter the payback, other things held constant, the greatest the project’s liquidity. This factor is important for smaller firms that do not have really access to the capital markets. Cash flows expected in the distant future are generally riskier than near-term cash flows, so the payback is used as one risk indicators.

Graduation (Narrative Writing) Essay Example | Topics and Well Written Essays - 500 words

Graduation (Narrative Writing) - Essay Example Unfortunately, when my father lost his way to the place, I started to get nervous that I might be late or my name would be called and I would not be there. This was a shameful thing to even think of yet I had these open-eyed dreams again and again. There was something seriously terrible happening that day, not only with me but also the ones who were linked to me in one way or the other. My family had to take the brunt of my worry. Eventually my father reached the place safe and sound and in one piece. I quickly wore the graduation gown and the weird cap that made me feel uneasy all the time. It kept getting off my head and I chased it more than anything else that I have chased all my life. The ultimate moment came when my name was called out on the stage but I did not pay heed to it, more so because I was busy finding my cap and then putting it back up on my head again. I was really angry when my name was called out the second time as I quickly got up and started to march towards the principal in order to collect my degree. This was a difficult walk since I stumbled upon back and forth. Eventually I reached the place where the principal was standing and took my degree and left the stage as soon as I had entered. I believe all of this happened within a blink of an eye. I just could not come to terms with what had happened with my own self all this while. I believe whatever happens, happens for a reason and so is the case with my graduation day. I laugh at the events that happened on that day and it makes me realize that nearly all events of life must be enjoyed as they teach one lesson or the other at different stage of one’s career. I was unsatisfied earlier that my graduation day went really bad and I had no fond memories of the same to share with my friends yet when I think about the same now, I come to the realization that it makes me feel happy and at ease and more than anything else, it spreads a smile on my face

Intercessory Prayer Case Study Example | Topics and Well Written Essays - 250 words

Intercessory Prayer - Case Study Example Even taking medicine and not having faith that one will be healed, does not help. Most of the researches that indicate positive links between prayer and health are situated in areas that possess strong Christian customs (Paul, 2008). Prayer is a coping action that mediates between religious faith and health, and can take different forms. Devotional prayers involving a close dialogue with a compassionate God are related with enhanced optimism, health and function. On the contrary, prayers that entail pleas for aid may, in the lack of faith, be linked with augmented distress and perhaps poor function (Kuchan, 2008). People should be encouraged to engage in prayer and have faith in God who heals. In the assessment of their faith, those with no faith but who just try the effectiveness of prayer cannot be healed. Hospitalized patients who have no faith and whose prayers entail desperate supplication for help are prone to need extra support from experienced nursing and chaplaincy personnel (Kuchan,

English Paper Essay Example | Topics and Well Written Essays - 750 words

English Paper - Essay Example This can be forced or voluntary and can often have severe effects on the minority culture. Such effects may include the loss of unique traditions and or other cultural aspects. The assumption that assimilation may be considered necessary or even desirable demonstrates an ethnocentric view of the minority culture – that is, that they are judged according to the standards of the dominant culture. In the case of the Australian Aborigines, assimilation was initiated largely as a result of such ethnocentric views, as will be explained. The British colonists who arrived in Australia towards the end of the 18th century saw the Aboriginal people and their lifestyle as lazy and degenerate. Partly due to the unpredictable climate of their environment, the Aborigines had long ago chosen not to adopt an agricultural style of subsistence, instead opting for a hunter-gatherer lifestyle. (Clarke 17) As a second consideration, agriculture is more demanding than the hunter-gatherer lifestyle, because cultivation and animal husbandry take up significant amounts of time. It never occurred to the British settlers that the natives had chosen their lifestyle for specific reasons. They simply saw the Aborigines as lazy people because they did not work all day. This label has persisted in the national consciousness of Australia and is still not completely eradicated in the present day (Clarke 18). Lingering attitudes such as these indicate that the incomplete understanding that began in the 18th century is still a part of modern Aus tralia. In the nineteenth century the welfare of the natives was not an issue in the minds of settlers, and they were often exploited as well. The following passage highlights not only practices of kidnapping and mutilation, but also the prevailing attitude of the settlers towards the natives: Aboriginal men and women were routinely kidnapped to

Working Mothers in America's Twentieth Century and Beyond A Social Essay

Working Mothers in America's Twentieth Century and Beyond A Social Perspective - Essay Example Women, in general, occupy a secondary or subordinate position in many societies. Plans have been devised to help working mothers overcome their socioeconomic problems and to provide them with equal opportunities. Instead of increasing productivity, development processes have relegated women into economic sectors that limit social and economic mobility. The 20th century has changed lives and destinies of women, their social, economic and political roles in society. Social change raises new issues about the social meaning of adult identity for women. Many women are marrying later, having one child, and having them later in life than their mothers or grand-mothers did. Before 1900, in all-male government circles, employment policies were being developed which catered for a proportion of unemployed working-class men, but which omitted any specific reference to women. Although the attempts of the 'right to work' movement in the decade before the First World War was to force the State to accept responsibility for creating paid employment for unemployed men have been documented. 1980s-1990s brought a change in social relations and political area allowing women greater participation in workforce and labor relations. Thus, at the beginning of the 21st century, the role of working mother is still limited by their social status (as a mother and a wife). The beginning of the 20th century marked a ne... owever, support for limiting the paid employment of wives and mothers also came from members of the employing class, including some whose family fortunes owed much to the employment of married women. his may have partly stemmed from dislike of the fact that working-class women who had economic independence, particularly those living in areas where women's full-time employment was the norm were relatively active in the women's suffrage movement. The women's almost equal pay and better conditions were offset by longer hours of work (Baxandall and Gordon 1995). These would have been problematic for widows with sole responsibility for young children. Conditions on public works for men were made relatively unattractive, through policy-makers' concerns that men should not come to prefer these temporary schemes to their normal employment; but this was not the case on the women's schemes, nor was it seen as a problem. Although in most of the workrooms the women enjoyed better pay and conditi ons than in their usual work, no concern was expressed that women's incentives to move on to paid employment would be undermined. This appears to have been based on a strong resistance to seeing women, even widows, as having a proper place in the labor market (Anderson and Eamon 2005). Before the WWII, social insurance was considered to be societal protection against those risks viewed as beyond the control of the individual, or risks incurred while contributing to the well-being of the society as a whole. At the core of this perspective was concern with the protection of earned income when earnings were lost temporarily or permanently. Maternity benefits for employed women, as a social insurance benefit, were almost as old as sickness benefits, the oldest such benefit. They were

Discuss Hirst and Thompsons view that globalization, as conceived by Essay

Discuss Hirst and Thompsons view that globalization, as conceived by the more extreme globalizers, is largely a myth - Essay Example The first reason is that globalisation is not a new, unprecedented phenomenon. It has been going on for over 2,500 years,3 being greatly instrumental in helping ancient Greek, Roman, Chinese and Middle Eastern civilisations bring together large areas.4 Silks from Asia were sold in the Roman Empire under the rule of Julius Caesar. The Middle Ages period witnessed Europeans buying pepper grown in Asia. Portugal ousted the Ottomans to establish control over the Indian Ocean in the 16th century, with its powerful caravels and carracks guaranteeing spice trade. The same scenario is repeated today, only this time it is the mighty fleet of U.S Navy carriers that is safeguarding the oil trade.5 The Dutch East India Company is credited with transforming globalisation into a remarkable business development in the 17th century. Dubbed as the world’s first Multinational Company {MNC} it pioneered the allotment of shares {a crucial driver for globalisation} as a method of dividing risk and facilitating joint ownership. During the 19th century, the liberalisation that took place {dubbed as the ‘First Era of Globalisation’} saw the speedy growth of trade and investment first between the European imperialist nations and their colonies, and later between the former and the United States.6 The second reason is the existence of Regional Blocks. Contrary to the concept of globalisation that involves the manufacture and distribution of goods and services of similar characteristics and quality on a global basis, nearly all trade involving big companies currently occurs within these blocks. Prominent traders find it more logical and profitable to concentrate on national and regional levels.7 Research has established that business enterprises tend to conduct operations in one of 3 Regional Blocks – North America, the EU and Japan.8 Within each Regional Block, trade activities are largely carried out by the Multinational Companies (MNCs)

Case study Example | Topics and Well Written Essays - 750 words - 38

Case Study Example The budget the manager intends to submit for the financial year is $4,900,000 which exceeds the expected expense by $700,000. Submitting a budget higher than the expected cost to be incurred is a misuse of the power and authority vested in the management position. This is taking advantage of the position to mismanage public funds which is not ethical at all. Public officers are expected to conduct themselves in an ethical manner encouraging transparency in carrying out their duties. Submitting of a budget higher than the expected costs equals betrayal of the public trust in the role of the management in the city’s waste management. Furthermore, submitting a higher budget will strain the city’s finances especially with the reduction in tax collections. As a result, the city may not have enough funds to process waste in the near future. Inadequate fund in the future will mean that not all the waste is processed thus causing pollution to the environment. Therefore, submitting a higher budget will seem good in the short run to manage the department but with long term effects that may paralyze the operations of the department. Though the manager expects a cut on the budget by 10%, this does not justify the increase in the budget from $4,200,000 to $4,900,000. That is an increase of $700,000 which is way above the expected increase. Given that the total cost of the department will amount to $4200000, reducing it by 10% will amount to reduction of: The manager does not justify for the excess amount of $280,000 after the expected reduction of 10% by the city controller. Lack of accountability for this amount creates loopholes for corruption. By having submitted a higher budget, the department will rarely take back any excess amount since the manager does not want to disclose their actions. This results in misuse of public funds. Moreover, the expectation of increased cost of labor and the amount of waste is not enough reason also for the inflation of the budget

International Terrorism and terrorist organizations Essay

International Terrorism and terrorist organizations - Essay Example These acts driven by the ideas of a group causes terror in the lives of a larger set of people and is commonly termed as terrorism. This essay would concentrate on various perceptions regarding terrorism that covers international terrorism, the structure and organization of terrorist groups, their views in the support of their actions, historical events that possibly led to revolutions which in turn gave rise to terrorism. A list of possible actions that can be taken to combat against terrorism is presented at the end. Defining the term terrorism would be a relatively tougher task. Not because of the political and emotional charges that the word carries but because of the flexibility in which the word could be (Hans, 1988). This had been defined by many organizations and institutions and individuals. The US army's study in 1988 counted that about 109 definitions of terrorism existed (Schmidt, 1988). In these definitions almost 22 different elemental definitions were found. A study in 1999 by terrorism expert Mr. Walter Lacquer also concluded that more than a hundred definitions of this word existed and focused on a point that the only general characteristic common to all the definitions about terrorism was that terrorism is closely associated to violence or threat of violence (Hans, 1988). Terrorism is different from criminal activities done for various purposes and it is important that this difference be brought out while defining terrorism. Many regions, countries have taken this issue into cons ideration while defining the word terrorism. Now let us brood over some important definitions of terrorism. The word terrorism happens to have its first appearance in "The Times" on 30th January 1795 (Hans, 1988). It was put in an excerpt to signify the changes taking place during rising of revolutionary government in France. One of the early definitions of terrorism was given by Maximilian Robespierre in 1794 which says that terror is nothing other than justice, prompt, severe, inflexible and it is not a unique principle (Schmidt, 1988). He regarded this as the consequence of democracy. The word terrorism got its place in English dictionary in the year 1798 and had a meaning "Systematic use of terror as policy". However it is interesting to see that the usage of the word terrorism and its meaning are quite controversial (Hans, 1988). The definitions used at found in the recent days are biased in a sense that they do not clearly specify the dividing line between groups who use the v iolence to achieve political goals that include government and other terrorist groups. Terrorism is labeled with tags that denote lack of legitimacy and morality. Let us first look at how the United Nations defines the word terrorism. United Nations does not accept any predefined definition of this word however, the UN academic consensus definition by Alex Schmidt is widely used by socialists and it is as follows "Terrorism is an anxiety-inspiring method of repeated violent action, employed by (semi-) clandestine individual, group or state actors, for idiosyncratic, criminal or political reasons, whereby - in contrast to assassination - the direct targets of violence are not the main targets."(Schmidt, 1988) Its short definition is the peacetime equivalent of war crime. However on 17th March 2005 the UN described that

Death of a Salesman by Arthur Miller, Essay Example for Free

Death of a Salesman by Arthur Miller, Essay In the books Death of a Salesman by Arthur Miller, and Fences by August Wilson, there are common themes that run throughout the book. Among these are two, hard working men that can be a bit disillusioned by life. The main character of each book, Willy Loman and Troy Maxson are similar in many ways. They both try hard to be good men and fathers, but unfortunately, they are imperfect in both aspects. Troy distances his self from his youngest son, and many could say that he is too hard and cold towards him. Willy in a way believes that his grown sons could not have done any wrong when they were younger and do no wrong now. But these two fathers are not totally bad. There are many good personal traits that they both display in these books. But as stated as before, they werent perfect at all. In many ways, both Willy and Troy were in fact good fathers. They worked hard to provide for their families and tried to set an example for their sons by their own actions. Willy was extremely supportive of Biffs high school football success and went to all the games. Troy tries to instill certain values such as responsibility into his son Cory and explains to him that he shouldnt go through life worrying if people like him or not. He tells him he takes care of him not because he likes him, but because it is his duty. Troy seems to be a bad father more visibly. He does not encourage Corys high school football career in anyway, in fact he tells him to tell the scout he is not interested and thinks having a job is more important. His attitude toward Cory the majority of the time is cold and harsh, as if he regards his son as someone he must deal with and take care of. Willy had a few problems of his own. First he let himself get caught with his mistress by his son, which devastated him. He also acted like his sons were perfect, which they werent. He should have made sure his son passed math so he could have graduated, but he put that into the hands of their next-door neighbor, Bernard. Willy also sets a bad example telling his sons that being well-liked is very important and holds it as a measure of success. He also leads them to believe that he is doing well financially, when in fact he is not. He has to get $50 from his next-door neighbor and Bernards father Charley. Although Willy and Troy werent the best or worse fathers they did raise their sons. The outcome of these men are different, however. Cory, who did not have a good father-son relationship or interaction with Troy moved out and joined the United States Marine Corps. Seven years later he returns for Troys funeral, no doubt successful and providing for himself. Biff and Happy, on the other hand, who both had a pretty decent relationship with their father ended up with menial jobs living with their parents at the age of 34. Happy is a philanderer with horrible ethics that sleeps with his supervisors girlfriend. Biff is unable to hold a steady job and has a new money making idea every week. It is hard to judge both Willy and Troy as good or bad if we arent in their shoes. Whether others may agree or disagree, it can be said that both fathers raised their sons the best that the could under their circumstances and most likely the best they knew how. The outcome of a person does not wholly depend on his or her parent. Their outlook on life and how much they want to accomplish while on this earth are other factors

The Kite Runner by Khaled Hosseini Essay Example for Free

The Kite Runner by Khaled Hosseini Essay On the surface Baba and Amir depict completely contrasting personalities. Amir is a timid, insecure child. Baba is a generous, respected over-achiever. Despite outward appearances however they share some startling similarities. They both hide a terrible secret from everyone they hold dear, and they both spend a significant part of their lives trying to atone for their respective sins. Its only when they deal with these issues that their true colors really show. In reality Baba and Amirs few similarities far outweigh their many differences. Amir and Baba appear to the outside world, and even to each other to be completely different people. Amir perceives Baba as perfect. Amir sees his father as a wealthy, and powerful man; everything anyone could aspire to be. In contrast Baba sees Amir as a weakling and a coward for the most part. He seems almost disgusted by Amirs weak stomach and cowardly tendencies. Baba loves Amir, but he finds his inability to relate to him a difficult hurdle to get over. Baba was athletic as a young man, a competitor who was used to winning. He used what he knew and tried to relate to Amir through sports, but despite Amirs best attempts to feign interest Baba saw through his charade, which only discouraged him further. Amir made his own attempts to bridge the gap between them with his stories, but Baba simply dismissed them as being childish. Baba would not encourage Amir to pursue writing because he didnt see it as a masculine thing to do. Perhaps one of the most prevalent differences between Baba and Amir is the way they see Hassan. In many ways Baba sees him as the son Amir should have been. Hassan is athletic, hard working, and exceptionally loyal. Amir treats Hassan like an underling, someone who makes him feel better about himself. Amir used Hassans illiteracy to make him feel better about himself. Even though they are genuinely friends, Amir still thinks of him as merely a Hazara, and harbors jealousy towards any affection Hassan receives from Baba. Hassan is not only the catalyst to many of their biggest differences, but also the foundation for their most intimate similarity. Baba and Amir may seem completely different but the biggest testament to their similar personalities is the way they deal with the most serious problems in their lives. Baba fathers an illegitimate son and tried to keep  him a secret for the sake of reputation. Amir allowed his best friend to be raped and uses the incident to gain his fathers love. Baba tried to alleviate his guilt over bedding his servants wife by treating Hassan equal to Amir, showering him with gifts and affection. Showing affection to Amir however made Baba feel even guiltier about Hassans situation so Amir is starved of his love. Subsequently Amir began to despise Hassan and did nothing to help him when he was raped by Assef. In fact he used the situation to force Hassan and Ali out of his home. The regret he faced haunted him for the rest of his life and he tried to atone for it by getting Hassans son out of Afghanistan. Both father and son in this scenario spent their lives dealing with an incident that they couldnt overcome. Baba showed he could be as cowardly as Amir when he refused to acknowledge Hassan as his son, and Amir showed he could be as brave as his father by going to Afghanistan and fighting Assef to save Sohrab. Baba and Amir found it difficult to show affection for one another throughout Amirs childhood due in large part to the glaring differences in their personalities. However, late in life Amir realizes that theyre really two of a kind. When theyre forced to deal with problems they show that their natural tendencies are strikingly similar. Baba and Amirs personalities are polar opposites, but at their core they are the same. Bibliography: Khaled Hosseini, The Kite Runner

Epidemiology Of Cholera John Snow Health Essay

Epidemiology Of Cholera John Snow Health Essay It has been over a century and a half when John Snow undertook the study of the Cholera epidemic of 1854 in London. His work, which was published in the 1855 book On the Mode of Communication of Cholera, is considered a milestone in epidemiology. The observations by Snow of the water-born transmission of cholera and the handle of the Broad Street pump was a work of genius that continues to inspire epidemiologists. Appearing before the local body of government on September 7, 1854, John Snow argued that the source of the outbreak of a cholera epidemic was water from a communal water pump. His investigation identified the pump at Broad Street near its intersection with Cambridge Street as the source of contaminated water. Cholera which is an acute, diarrheal illness caused by infection of the intestine with the bacterium Vibrio cholerae, causes significant morbidity and mortality in many developing countries. This paper examines the cholera epidemics (and pandemics) in recent history i ncluding the outbreak of 1854 in London and the role played by John Snow which had laid the foundations for the modern principles of epidemiology. Introduction It has been over a century and a half when John Snow undertook the study of the Cholera epidemic of 1854 in London. His work, which was published in the 1855 book, On the Mode of Communication of Cholera is considered a milestone in epidemiology. The observation by Snow of the water-born transmission of cholera, and the handle of the Broad Street pump was a work of genius that continues to inspire epidemiologists. Appearing before the local body of government on September 7, 1854, John Snow, an anesthetist in London, argued that the source of the outbreak of a cholera epidemic was water from a communal water pump. Working with the data reproduced in table 1 (Bingham et al., 2004), Snow identified the pump at Broad Street near its intersection with Cambridge Street as the source of contaminated water. What followed is best told in his own words: I had an interview with the Board of Guardians of St. Jamess parish on the evening of Thursday, 7th September, and represented the above circ umstances to them. In consequence of what I said, the handle of the pump was removed on the following day (Snow, 1855). Each year, outbreaks of cholera to cause death estimated at 120,000 worldwide, with the vast majority occurring in children (WHO, 1995). Epidemiology of cholera is characterized by several key principles including (i) Cases tend to be concentrated in specific location and occur during a specific season (ii) the highest infection rates in children of 1-5 years in areas where infection is endemic (iii) antibiotic resistance patterns often change from year to year, (iv) pathogen strain often exhibit clonal diversity, and (v) prevention measures against the disease include sanitation, hygiene and immunity improvement. Cholera has been ranked as one of the emerging and reemerging infections (Satcher, 1995) facing many developing countries. Several recent events highlight the importance of epidemiological disease include the 1991recurrence of cholera in Latin America (Levine, 1991) ( Ries et al., 1992); the 1994 outbreak of cholera which took place in a Rwandan refugee camp in Goma, Zaire, which resulted in approximately 70,000 cases and 12,000 deaths in (Siddique, 1995), and the outbreak of V. cholerae O139 in the India subcontinent from 1992 to 1993, possibly marked the start of the eighth cholera pandemic (Ramamurthy et al., 1993)(Swerdlow et al., 1993). Pathogenesis and transmission of Cholera Vibrio Cholerae are comma-shaped, gram-negative bacteria that have been the cause of several great long-lasting epidemics and pandemics of diarrheal disease. Many of these pandemics began in the Ganges Valley of India and Bangladesh, which is never free from cholera. Although there are 140 serotypes of V. cholera, until recently only 1 stereotype was associated with several diarrhea. Beginning in 1992, a new V.cholerae stereotype (0139, also known as Bengal) has been associated with sever, watery diarrhea (Faruque et al., 1998) The vibrios never invade the epithelium but instead remain within the lumen and secrete an enterotoxin, which is encoded by a virulence phage. Flagellar proteins involved in motility and attachment are necessary for efficient bacterial colonization, as has been described for Campylobacter. The vibrio hemagglutinin, which is a metalloprotease, is important for detachment of Vibrio from epithelial cells. The secretory diarrhea characteristic of the disease is caused by release of cholera toxin. Cholera toxin is composed of five binding peptides B and a catalytic peptide A (McKenzie et al., 1984). The B peptide, serving as a landing pad, bind to carbohydrates on GM1 ganglioside on the surface of epithelial cells of the small intestine, enabling calveolar-mediated endosomal entry of toxin subunit A into the cell (Laloi et al. 1996). Reverse transport of the subunit A from endosome into the cell cytoplasm is followed by cleavage of the disulfide bond linking the two fragments of peptide A (A1 and A2). Catalytic peptide A1 is generated, leading to the following sequence (Dertzbaugh et al., 1993): A1 interacts with 20-kD cytosolic proteins called ADP-ribosylation factors (ARF). The ARF-A1 complex catalyzes ADP-ribosylation of a 49-kD G-protein (called GsÃŽÂ ±) (Randazzo et al., 2000). Binding of NAD and GTP generates an activated GsÃŽÂ ±, which in turn binds to and stimulates adenylate cyclase. ADP-ribosylated GsÃŽÂ ± is permanently in an active GTP-bound state, resulting in persistent activation of adenylate cyclase. The activated adenylate cyclase generates high levels of intracellular cAMP from ATP. Cyclic AMP stimulates secretion of chlorides and bicarbonate, with associated sodium and water secretion. Chloride and sodium reabsorption is also inhibited. The reabsorptive function of the colon is overwhelmed, and liters of dilute rice water diarrhea containing flecks of mucus-up to 14 L/day, equivalent to the circulating blood volume, causing dehydration and electrolyte imbalances. Because overall absorption in the gut remains intact, oral formula can replace the massive sodium, chloride, bicarbonate, and fluid losses and reduce the mortality rare from 50% to less than 1% (Sharma et al., 1997) Epidemiology of Cholera Early Pandemics Since the beginning of the first pandemic in 1817, seven cholera pandemics have occurred (Pollitzer,1959), excluding the seventh pandemic, which took place on the Indonesian island of Sulawesi in (65), pandemics occurred in the Indian subcontinent in the Ganges delta and spread to other countries over many years (Snow, 1855). In 1830, the epidemiological and public health approaches to cholera developed in the context of some understanding of the nature of certain infectious diseases, including smallpox and syphilis, with little agreed differentiation of the fevers. In his late 18th century doctrine, Benjamin Rush describes there was but one fever in the world (Shryock, 1936) had received broad support. Exciting factor in the cholera epidemic was sometimes considered as shaping existing fevers into its own image, and the arrival of cholera coincided with an increase in mortality and/or transferred deaths between categories was questioned. The second cholera pandemic of the early 1830s invaded the British Isles, and was marked by epidemiological observations made by John Snow on the waterborne cholera transmission in London between 1847 and 1854(Snow, 1855). Ships carrying Irish immigrants caused the second pandemic in Canada (Marian, 1957). During the third pandemic (1852-1859), cholera was raging in the United States, and during the 1870s at the end of the fourth pandemic, towns and villages along the Ohio, Missouri, and Mississippi, rivers experienced cholera (Billings et al., 1975). The fifth pandemic mainly affected South America; causing large epidemics in several countries with Argentina, Chile, and Peru suffering high casualties. (Gil et al. 2004). Robert Koch isolated the cholera bacterium, known as comma bacilli during the fifth pandemic in feces of patients in Egypt in 1883 and India in 1884(Koch, 1884). Between 1899 and 1923, the sixth pandemic involved populations expanded in the Balkan Peninsula and the Middle East (Pollitzer, 1959). Apart from a large epidemic in Egypt in 1947 (Shousha, 1947), cholera was confined to southern and Southeast Asia since the mid-1920s until the 1961 outbreak of the seventh pandemic in. Both the sixth pandemic and possibly the fifth pandemic were caused by V. cholerae of classical biotype. The Seventh Pandemic The seventh pandemic is considered the largest of the pandemic in the geographical distribution, and was caused by V. cholerae O1- biotype El Tor (Table 2). The 1961 pandemic first invaded the island of Sulawesi in Indonesia and spread to other islands, including Borneo, Sarawak Java, Taiwan, the Philippines, and Sabah. It affected the entire archipelago of South Asia at the end of 1962 (Kamal, 1974). , In Asian mainland, from 1963-1969, the pandemic affected Cambodia, Thailand, Vietnam, Malaysia, Burma, India, Pakistan, and Bangladesh. Cholera reached Pakistan shortly after El Tor, and outbreaks were reported in Iraq, Iran, Afghanistan, and in the neighboring republics of the Soviet Union (Kamal 1974). By 1970, El Tor cholera had reached the Arabian Peninsula, Syria and Jordan, and to a lesser degree, in Israel (Cohen et al., 1971). The seventh pandemic was in sub-Saharan West Africa in early 1970, causing explosive epidemics as a result of more than 400 000 cases of high mortality, attributed mainly a lack of background immunity of the population, and lack of healthcare infrastructures (Goodgame et al., 1975). During this epidemic, cholera invaded the coast and the interior through waterways and continued to spread to the interior of the Sahel countries by land to travel to nomadic tribes. During the 1970 cholera epidemic, 28 were newly affected were reported and 16 are in Africa (Kaper et al., 1995). In South America, the seventh pandemic which began in Peru in January 1991 caused a return of cholera to the continent after more than a century in an explosive epidemic (Levine, 1991) (Ries et al., 1992). Subsequently, neighboring Ecuador and Colombia also reported cholera epidemic. In each of these countries were people of low socio-economic status, lack of clean water and sanitation, the most affected (Pan American Health Organization, 1991). In April 1991 a small outbreak was reported in Santiago, the capital of Chile (Levine, 1991). Cholera then invaded more countries in South and Central America along the Pacific coast. The Pan American Health Organization estimated that during 1991 and 1992 there were 750,000 cases of cholera and 6,500 deaths in the Americas (Pan American Health Organization, 1991). Recently, the July 1994 outbreak in Goma, Zaire, (Siddique, 1995), is considered one of the worst outbreaks in recent history. Nearly a million people were displaced to Zaire and sheltered in refugee camps as a result of Conflicts between tribes in neighboring Rwanda. Outbreak of cholera in refugee camps affected by poverty caused an estimated 12,000 deaths among Rwandan refugees during a period of three weeks (Siddique, 1995). The seventh pandemic was active causing seasonal outbreaks in several developing countries. However, in 1992, V. cholerae belonging to serogroup non-O1 (now known as O139) caused massive epidemics of cholera in Bangladesh and India and spread to other countries, which could represent the beginning of the eighth pandemic Conclusion John Snow achievement was based on the logical organization of his remarks. He recognized a natural experiment, and its quantitative approach to the analysis of the occurrence of disease in human populations, which is actually a summary of the views of modern epidemiology. It has been over a century and a half since Dr. Snow had published his findings. And in spite the medical and epidemiological advancement in combating the disease, yet, the threat of cholera remains very real and cholera continues to be a global threat to public health and an important indicator of the lack of social development, especially in developing countries which suffer from lack of access to drinking water and lack of sanitation. The disease continues to challenge the increasing proportion of vulnerable populations living in unsanitary conditions, such as slums and refugee camps. The treatment centers and water purification units in poor nations are only interim measures, and steady decline in the spread of the illness should not be seen as a complete victory.