Overview Of Benchmarking Theory Management Essay

Overview Of Benchmarking Theory Management Essay Benchmarking theory is established upon the performance comparison, gap, and changes in the management process (Watson, 1993). A literature review also shows that majority of benchmarking methodologies perform the same function as performance gap analysis (e.g. Camp, 1989; Karlof and Ostblom, 1993; Watson, 1993). In a context of waste, first rule of benchmarking is to determine the performance gaps with respect to generation and utilization within a management system and to develop method to close them. The gap between internal and external practices reveals the changes and at the same time differentiates benchmarking theory from comparison research and competitive analysis. The author explained further that competitive analysis focus on product or service comparisons but benchmarking examine the operating and management skills that is use to produce goods and services. More also, competitive analysis looks at the characteristic of competitors in the same geographical location whilst benchmarking seeks to find the best practices regardless of location. (Walleck et al., 1991). Benchmarking has been defined by many authors due to its positive and negative result affecting the success of performance improvement within the organization. The literature review of Kozak, 2004, original sources: Camp, 1989; Zairi, 1992; Smith et al., 1993; Rogers et al., 1995, explained that benchmarking: Enable organization to ascertain the position they have more strength and weaknesses depending upon charges in supply, demand and market condition. Enables to set new standard and objectives to enhance customer satisfaction in term of quality, cost, product and services. It gives employees new standard knowledge to work on and also motivate them to always strive for more improvement. Enable organization to determine the possible level of performance they could attain by looking at others and to what extent they could achieved such performance Help organization to stimulate continuous performance which will give them competitive edge over others and enables it maintain world class standard. Despite the above benefit, a successful benchmarking researcher Bendell (1993) stated that time constraints, competitive barriers, cost, lack of both management commitment and professional human resources, resistance to change, poor planning and short-term expectations are regarded as barriers. The author further noted that poor execution of benchmarking exercise can lead to waste of time, finance and human resources. Elmuti and Kathawala( 1997) illustrate that there is no single best practice of benchmarking because peoples ideology varies and organization concept and system differs from one another. On a contrary, there is a risk involved in benchmarking others and adopting their new standards into ones own company. However, the best practice which is producing outstanding performance with good examples should be perceived and adopted. According to research, benchmarking has been defined by many authors and organization even though each definition aims to reach same conclusion. Nevertheless, benchmarking was basically stems from Demings quality management theory, which aims to enhance quality and check its sustainability by following several stages in order( Kozak 2004, p5). Websters Dictionary defines benchmark as a standard by which something can be measured or judged (Kozak, 2004 p. 5). Xerox and Robert C. Camp at the end of the 1980s gave most widely accepted and referenced text on the subject of benchmarking as the continuous process of measuring our products, services and practices against the toughest competitors or those companies recognized as industry leaders (Camp, 1989). On a simply note, benchmarking is the process of finding the best practice in an organization and forecasting what performance should yield in the future. The three principles of benchmarking are maintaining quality, customer satisfacti on and continuous improvement. (Kozak 2004, p.5, original source: Watson, 1993). Some author sees benchmarking as a continuous process or measurement while others defined it as finding and looking significance things to enhance an organization performance. For example, Vaziri (1992) defined benchmarking as a continuous process of comparing organizations performance with that rated as the best within the industry considering consumers needs and determining what needed to be improved in order to have competitive edge in the future. Similarly, Watson (1993) also emphasizes benchmarking in term of continuity feature referring to the continuous input of information acquired from benchmarked organization into the organization. Geber (1990, p. 36) based his definition at significance focus on the best practice of benchmarking as follow: a process of finding the world-class examples of a product, service or operational system and then adjusting your products, services or systems to meet or beat those standards. Approaches to definitions of benchmarking Adopted from (Kozak, 2004. Destination Benchmarking) In practice by many organizations, benchmarking process usually encompasses the following: Regularly analyzing and comparing aspect of performance with high ranked organization Identifying the performance gaps Establishing fresh method to improve on such performances Continuous tracking the implementation improvement; and By continuous monitoring progress stages and assessing the benefit Types of benchmarking Due to many relevant literature reviews, it could be seen that there are many classification of benchmarking, the main categorization are internal, competitive and functional benchmarking (Kozak 2004, p.10 original authors: Camp, 1989; Zairi, 1992). Kozak (2004,p.10) further classified benchmarking into two parts: internal and external benchmarking, in same context, competitive and functional benchmarking was classified under external benchmarking. INTERNAL BENCHMARKING Internal benchmarking is regarded as two ways communication and sharing information between departments within the same organization or between organizations operating as a branch in different countries (Cross and Leonard, 1994; Breiter and Kline, 1995). This kind of system can be found in a franchising company whereby an outstanding performance by any part of the organization will be learnt by the other. Internal benchmarking is an added advantage to an organization or partner who shares a common language, culture and systems, having easy access to data, and giving a baseline for future comparisons (Breiter and Kline, 1995). EXTERNAL BENCHMARKING It is an opposite or reverse case of internal benchmarking as it was read in many relative literatures. External benchmarking requires comparison of activities with external organization in order to acquire method, new ideas and knowledge using by the organization to attain such an outstanding performance in the production of goods and services. Kozak (2004, p11) noted the objective of external benchmarking as the persistence in improvement of ones performance by measuring and comparing with that of others and determine how others achieve their performance levels. This type of benchmarking provides opportunities for an organization to learn from the best practices and experiences of the others who have the competitive edge in the industry. The consistent review of benchmarking by Kozak (2004, p.11) has brought up another three subcategories of benchmarking which are: competitive, generic and relationship benchmarking. Competitive benchmarking: this type of benchmarking occurs only among the direct competitors. According to Kozak (2004) explains that competitive benchmarking is regarded as the most sensitive type of benchmarking activities because of it difficulties in achieving an applaudable collaboration and cooperation with direct competitors and reach primary sources of information. For example Xeroxs market shares starts to diminish because of the entrance of new competitors. Therefore the management decided to benchmark its performance with competitors within the same industry. The results of this enhance its financial position, stabilized its market shares and increase its customers satisfaction. (Cook, 1995). Functional benchmarking: Functional benchmarking refers to comparative research and attempts to seek world-class excellence by comparing business performance not only against competitors but also against the best businesses operating in similar fields and performing similar activities or having similar problems, but in a different industry (Kozak, 2004, original sources: Davies, 1990; Breiter and Kline, 1995). For instance British Rail Network South East benchmarked British airways in order to improve the standard of cleanliness of trains. They were able to achieve such aim by the survey that was conducted on British airways mode of cleanliness. (Cook, 2005). Moreover, this type of benchmarking makes it easier for best in class organizations to share new ideas, best practice and experience together and it is as well regarded as non- competitive benchmarking (Kozak 2004, p.12). Relationship benchmarking: This type of benchmarking occurs between organizations that have mutual relationship together before the agreement of benchmarking is sealed (Anderson, 1995). This method potentially may provide some benefits to organizations since less time is required and the trust established between the two parties will help break down confidentiality barriers. Cox et al. (1997) call this collaborative benchmarking. Benchmarking best practice Historically, benchmarking is seen as an essential tools for continuous improvement of goods and services in an organization ( Dattakumar and Jagadeesh 2003). For example Xerox Corporation in the united state was the first company to be credited with a successful benchmarking project in 1979. Nowadays, organizations have realized that in order for them to survive in the nearest future, they have to initiate major changes within their organization that will make them more productive and reduce costs. benchmarking goes beyond just competitive analyses, rather than analyzing organizational processes and method to assess how the competitive edge is achieved. Benchmarking against Best practice requires seeking out the undisputed leader in the process that is critical to business success regardless of sector or locations. I.e using the most effective methods of achieving optimal performance leading to superior performance is the process of benchmarking for Best Practices identifying, sharing, and imparting knowledge, innovative ideas, and highly effective operating procedures related to best business practices, inside and outside your organization (Julian L. Aston and Jonathan A. Goldhill). In a nutshell, the achievement of any organization is to successfully identify and appl ying best practices in its operations which will result to reduction in business expenses and improve its organizational efficiency. In order for benchmarking process to be achieved in an organization, the follow steps need to be initiated and implemented (Julian L. Aston and Jonathan A. Goldhill): Step 1: The management needs to establish a lead Best Practices team that will be engaged with overall development and company-wide implementation of this important new activity. In addition, creates departmental benchmarking teams charged with development and implementation of Best Practices within their individual department. Step 2: Each team determines the types of Best Practices their department must uphold. Step 3: Teams identify benchmarking resources applicable to their Best Practice needs. Step 4: The teams collect and analyze information. Step 5: Each team determines the value of each Best Practice relative to attaining departmental and overall corporate objectives. Step 6: Team members take the time to understand and analyze the point gap between an existing standard or practice and the desired best practice standard. Step 7: Each team brainstorms how they can close the point gap, and develops an action plan in support of upholding each Best Practice. Step 8: The teams take action under the leadership and guidance of the Lead Best Practices Team, reporting to Senior Management. Finally in order for the implementation of a Best Practices Program to be successful, establishment of departmental Best Practices teams must be initiated and charged with the task of managing the process on a continuous basis. Best Practices Example A vivid example of a best practice is demonstrated by SRC in Springfield, Missouri. Convinced that everyone is responsible for the companys success, SRCs management team trained every employee in cash flow management, a tool that has enabled the company to generate double-digit growth every year since its founding 12 years ago. SRC has grown in 12 years from one company of 100 employees to 12 employee-owned companies in 16 sites with 750 people. SRC has been named the Entrepreneurial Company of the Year by Inc. magazine for the last three years. The current turnover rate is less than 1 percent. http://www.qualitydigest.com/feb/bench.html DIFFERENCE BETWEEN BENCHMARKING AND BEST PRACTICES Are benchmarking and best practices the same? According to many literature reviews, it could be understood that benchmarking is totally differ from best practices. Benchmarking is the process that gives one the opportunities to ascertain potential best practices, i.e. identifying best ranked performer; one to locate a specific practices within an organization that could enhance own performance. However, there are different categories of benchmarking which organization might practice and it was understood that some organization benchmarked for the purpose of setting performance target for their own organization rather to ascertain practices that contributed to the success of other organization and to emulate it. What distinguishes best practices from benchmarking? A best practice is never a new idea, perhaps is what meets the seven following criteria: Successful over Time: A best practice must be documented. Quantifiable results: The achievement must be quantifiable. Innovative: Must have a distinctive program and process from its peer Recognized positive outcome: Best practice should generate different positive result and indicators Repeatable: A best practice should be adopted with modifications. Should establish different strategies and be able forecast benefits that are likely to be accrue to others. Has local importance: Best practice is seen as an outstanding performance to those who seek for it. Therefore, it should not be a duplicate strategy; i.e organizations should adopt it with modification. Not linked to unique demographics: A best practice may have evolved as a result of unique demographics, but organization from other demographics should be able to transfer with modification. http://www.scribd.com/doc/83467243/14/DIFFERENCE-BETWEEN-BENCHMARKING-AND-BEST-PRACTICES. In conclusion, although different authors views benchmarking from their different perspectives as it is demonstrated in the figure () . All these definitions portray same aim and objectives: the continuous measurement and improvement of an organizations performance against the best in the industry to obtain information about new working methods or practices (Kozak 2004, p.7). However, best practices and methods that are seen as the success key to an organization may not necessarily be the best to those adopting it. Therefore benchmarking requires full scale modification and extensive innovation in order for justifiable achievement to be attain.

Caliban and Trinculo Essay

Caliban and Trinculo are hiding underneath Caliban’s cloak because they are afraid of the storm and of what other beings are approaching them. Stefano has discovered what he thinks is a creature with four legs and two heads, which is really Caliban’s and Trinculo’s legs next to each other and both of their voices. The use of language in this extract differs between characters. Stefano’s use of language is blunt and basic English. The fact that he is drunk adds to the effect that his words are slightly slurred. Stefano and Trinculo are both very low down in the hierarchy, Stefano is the Alonso’s butler and Trinculo is his jester, and this also means that they would not have been taught proper English and so would not have been able to speak in clear, full sentences even when they were not scared of the storm and drunk. Caliban’s language however is a lot nobler and it is of much better English than those of Trinculo and Stefano. This is strange because it would be much more correct to have it the other way around with Trinculo and Stefano speaking better English than Caliban. The reason for this is because when Prospero first discovered Caliban, he treated him nicely and with some respect and Miranda also taught him to speak properly and eloquently and so he sounds like a nobler creature than he actually appears to others. Stefano plays a minor role in the play but provides much of the humour and acts as a contrast between those characters high up in the hierarchy and Caliban. Stefano and Trinculo do no measure up to characters like Alonso, Sebastian and Antonio, but both men have very similar characters. Trinculo’s role in the play is to convey to the audience the comedy and humour that most of the traditional plays of that time contained. However, because he, like Stefano, sees Caliban as a source of future income, he gets jealous because Caliban has chosen Stefano to be his master. When the opportunity arises, he is more interested in getting as much as he can than in fairness. There are many different themes to Shakespeare’s play, ‘The Tempest’, and they all occur frequently. One of these is sovereignty. It is connected repeatedly to Alonso and the usurpation of the throne of Naples and of the Dukedom of Milan. The occurrence of this theme in this passage is when Stefano has just discovered Trinculo hiding from the storm underneath Caliban’s cloak and Trinculo says, ‘And art thou living, Stefano? O Stefano, two Neapolitans ‘scaped? ‘ Trinculo is asking Stefano if they are the only two people to survive the storm. They think that they are the only ones to survive and so they now believe that they are in line for the throne now that the king, his son and all of the others are out of the way. This also connects to the theme of usurpation which is also echoed frequently throughout the play. Other examples of usurpation in this extract and throughout the play are numerous. One of the main ones is when Antonio and Sebastian conspire to kill Alonso and Gonzalo whilst they slept in order to take over the throne of Naples together.

Prostitution The Oldest Profession On Earth - 1107 Words

Prostitution Prostitution is considered as the oldest profession on Earth. Sexual service in return for payment is called the prostitution. Prostitution is a big issue effecting women, men, and children all over the world. This is a world-wide controversy and it is something that people are not comfortable talking about. The question is whether people who are involved in the sex industry are willingly or are forced to do it. Our society has different points of view on this issue. Some people agree and want to legalize it; some people are strictly against it. Anyway, throughout our society people look at the work in sex industry as degrading work. In some jurisdictions, prostitution is approached by three ways –regimentation, abolition,†¦show more content†¦They also believe that legalizing prostitution would increase the spread of disease, stating that it takes several weeks to get the results from STD tests allowing an infected prostitute to continue infecting her cl ients. Many also believe that since most sex workers are female, the practice is demeaning to women and enhances the changes of rape and violence. Some go so far as defining prostitution as a type of rape, since it turns a woman into an object for a man s use. Others state that prostitution increases the involvement of sexual predators and the use of minors as sex slaves (Debate). First, prostitution is closely associated with many accompanying phenomena that threaten the internal security of the country; therefore, it is perceived very negatively by our society. This means that a serious crime such as a drug-related crime, human trafficking, and commercial-sexual exploitation of children goes along with prostitution. Also, health risks (sexual transmitted diseases) accompany this activity. â€Å"Reaching sex workers is a critical effort for public health. Not only are sex workers at risk for higher rates of HIV and other STIs, sex workers who are unaware of their HIV status can en danger their own health and increase their risk of transmitting HIV or STIs to others† (CDC). In eight European countries, such as Germany, the Netherlands, Austria, Hungary, Switzerland, Greece, Latvia, and Turkey prostitution by itself is legal.

Strategic Analysis Of Financial Statements A Case Study - Free Essay Example

Sample details Pages: 6 Words: 1846 Downloads: 1 Date added: 2017/06/26 Category Finance Essay Type Analytical essay Did you like this example? In current society, fundamental and technical analysis is used in company to analyze financial statements. But there is no identical that which approach is more profitable. In this essay, the comprehension and comparison can be researched in order to identify the advantages and disadvantages of the two approaches and propose suggestions to the company. Introduction Fundamental analysis and technical analysis are two kinds of approaches to analyze company financial statements. Some traders use them alone and some others associate them together (Talati,2002).But no matter how do they use, the two approaches aim to optimize company profit and help managers conduct the operation. In the first and second part, fundamental analysis and technical analysis are invested and in the third part, the differences and connection are researched and get the conclusion which is profitable for company financial statements analyzing. Don’t waste time! Our writers will create an original "Strategic Analysis Of Financial Statements A Case Study" essay for you Create order 3. Critical discuss of fundamental analysis 3.1Definition of fundamental analysis Fundamental analysis involves analyzing financial statement, management and market and competitors. It focus on identify the fundamental value, production, interest rate and economy of the company. Fundamental analysis is the research of a company with the calculating the performance value and operation (Finweek,2006). In addition, it is a kind of investment which is the essential element of the asset managers (Moube A and Jannach M, 2003). As the historical mentioned, fundamental analysis start from a companys financial analysis, investors research the financial statement of the company and investigate its advantages and problem to forecast the future direction (Oglesby,2003). 3.2 Explain the procedure of fundamental analysis As above mentioned, fundamental analysis is a way to find the fundamental financial level of the company. The analysis aiming to investigate the financial health and estimate intrinsic value (Finweek,2006). There are three elements of fundamental analysis: economics analysis, industry analysis and company analysis. Each of the three analyses can express the intrinsic value of the company. If the intrinsic value is higher than market price, investor should take some measures to buy or share. In addition, companys fundamental or intrinsic value is decides by financial statement information. Firstly, share received from investor and supplier. Then amount of debt can examined the health of its operation by using debt to equity ratio and the current ratio. Thirdly, computing price/earnings ratio and PEG value to modify some measurement and ensure the growth of company (Elleuch and Trabelsi,2009). 3.3 Two approaches of fundamental analysis Fundamental analysis is one of professional analysis either in stock broking (sell side) or asset management (buy side) research forms (Finweek,2006). Moreover there are two approaches of fundamental analysis: top-down and bottom-up investing. 3.3.1 The top-down approach The top-up investing approach analyze with global economics, it comprised by international and national indictors such as GDP growth rates, exchange rates, interest rates, productivity and inflation (Wikipedia,2009). Generally speaking, top-down invests companys operation environment and examine the current strategy to predict future performance. Moreover, the approach includes macroeconomic, social and political activity which is useful for estimating the operation of the company. The main benefit of this approach is guarantee some relevant information keep in accordable which cannot cause conflict (Finweek,2006). 3.3.2 The bottom-up approach The bottom-up approach concentrates on specifically business and research different company of different invest ways. Bottom-up investing usually used in larger scale compared top-down used in local scale (Menge et al, 1997). To evaluate the influence of bottom-up factor in a global company, if the ecosystem is multiple and complicated, we should use different ways to match them. At first, the individual basic elements should be in great detail, and then this detail link together to develop a subsystem which can help company achieve global purpose (Pereira,1993). 4. Critical discuss of technical analysis 4.1Definition of technical analysis Technical analysis is a kind of security analysis which aim to describe the trend of company in future and the change of trend based on price and volume. Moreover, technical analysis does not attention for value, information and price can be predicted by historical data (Wikipedia,2009). Usually, technical analysis is named chartists because graphical presentations of their trading rules are used (Mizrach and Weerts,2009). Compared with fundamental analysis, technical analysis is more academic and practical, it usually discover the potential of previous price and then forecast the future equity value for managers (Battman et al,2009). 4.2 Characteristics of technical analysis Technical analysis is based on price and volume transformation to examine different capacity of trading rule. For example, technical analysis can help manager realize the earning profits by using relative strength index, moving average and inter-market correlations, etc (Battman et al,2009). Besides, technical analysis can illustrate the current and future share price and equity returns especially the random walk hypothesis which past price and predictable future return is identical agreement (Lo and MacKinlay, 1988, 1999). In addition, technical analysis studies the profitability of strategy which includes construction of portfolio at the foundation of historical measurement (Jegadeesh and Titman, 1993,2001). Because of that, technical analysis predict price movement based on historical performance make positive return in future by risk evaluation and capital management. 4.3 Principles 4.3.1 Prices move in trends When the market turn up or down, along with the price changed. Specifically, when the stock rose, sellers go into the market and sell the stock. There are various elements caused the changed such as perceived risk , market volume, analyst rating change and return (Mizrach and Weerts,2009). For example, a experiment conducted by Huddart et al(2007) which research of 52 weeks changed of price. The trading volume raises obviously when the variation of trading range, and the trend is abnormal at least 2 weeks. 4.3.2 History tends to repeat itself Investors believe that the trend can repeat several times because the behavior always repeats itself usually. Based on the price, technical indicators describe the state of market participant and operation but the behavior is not variable (Collins, 2001). 5. Compared two analysis used in analyzing company financial statements Financial statement is an outline of companys activities, operation and investment from a period of time. Information and data from financial statement reflect the financial situation and business operation of the company which is useful for investors and managers making decision and control. From the financial statement analysis, investors can obtain insight of the enterprise including strength and weakness and then advance the strength and diminish the weakness (Malhotra,2008). 5.1 Fundamental analysis used in company financial statements 5.1.1 Financial ratio Fundamental analysis focus on financial ratio which comes from balance sheet, income statement and statement of cash flows. From the financial ratio, managers can get the comparison of the company and other company in the same industry, topmost company in the industry and the condition of previous year of the same company. By using fundamental analysis, financial ratio is a clear way to describe the company position relative to against its peers and get the conclusion of strength and weakness and then make a future strategy to the company. Firstly, debtor turnover can reflect a firms activity. Specifically, turnover represents the inventory circulating rate. If the turnover is high, it means commodities sold quickly. In another word, the company activity is frequently (Wikipedia,2009). Secondly, current ratio can reflect the liquidity. As we all know, current ratio is equal to current assets over current liabilities. As a result, current ratio is significant relevance to liquidity be cause 1 percent increase of current ratio can cause more decrease in debt-equity ratio and debt-assets ratio (Toby,2007). Thirdly, gearing or leverage reflects financing. Therefore, change in leverage effect debt and stock so it demonstrate the return differences from different companies (Ozdagli,2009). 5.1.2 Global economics and environment In current society, global trade develops more quickly than the whole world GDP. In addition, the environment became more and more international too, so it means the firm should face more competitive challenge. As fundamental analysis, it focus on the whole state economy, interest rate and earning. When the amount of currency became reduced or the currency demand become increasing, fundamental analysis can research the forward decision and interest rate which have strengthening and weakening effect to the financial statements. Although foreign investments is effected by high interest rate which can improve the local currency (McDonald,2007). 5.2 Technical analysis use in company financial statements Owing to some problems which effect public value arisen in financial statements, investors prefer to use technical analysis verifying their attitude. Movement of price and volume can demonstrate the financial information by daily operation (Standfield, 2005). 5.2.1 Predict by historical data Technical analysis like a weather forecast which compare the past and present weather condition and predict whether need to bring umbrella if you want to go out. Actually, technical analysis predicts the trend to decide whether buy or sell (McDonald,2007). If the prediction would be accurate, some measurement should be taken during the technical analysis. For example, in order to foresee the trend of price, investors always random walk. The random walk model is known but its implication for technical analysis is hard to understand. Firstly, the price should constituent organized and last to the future. Secondly, investors use random walk model to predict the future trend. Specifically, the model can be describe,P means price and t means days. E()=0,E( During this model, the prediction price based on the current price . For one period prediction, = = +=. In addition, for two period, the formula is similar: = = +=+. Because of that, the error of prediction is var ((=, var (((=. So base d on the pattern, we can get a conclusion that var (=. From the model, the average of price may not be altered but the individual agreement must be random. In that condition, trend of future under technical analysis can be gainful. For instant, if the primary data shows a downtrend, then investors can adopt a short location until the trend became increased. After that, a long location takes place to the short one and make sure the development stable (Tomek and Querin,1984). 5.2.2 Differences and connection between technical analysis and fundamental analysis As mentioned above, the two approaches analyses are not total different. If a company use the mix analysis, fundamental analysis focus on the reason why price will change while technical analysis focus on when will the price change. As a result, it is the best way to integrate the two approaches. Therefore, if a fundamentalist look through technical analysis, some new discoveries such as new way to access the market or obtain the capital market share. It is resemble that technician use fundamental analysis to research the trade in market (Talati, 2002). Although there are some benefits to combine the two approaches, some limitations are existed. Technical analysis is good at control risk but it suitable for both short team and long term so that it is not applied in fundamental analysis sometimes which only use long term. In addition, fundamental trader can make decision depend on his own discretion while technical trader should rely on the investor or computerized design (Talati, 2002). 6. Conclusion In summary, both fundamental analysis and technical analysis are important to analyze company financial statement. Although there is some differences between them, the two approaches are not incompatible. Managers and investor could use the two approaches or use one of them depend on the market condition to optimize the profit of company.