Driving Forces for M-Commerce Success

Driving Forces for M-commerce Success Jason J. Zhang, Yufei Yuan, and Norm Archer Michael G. DeGroote School of Business McMaster University Hamilton, Ontario, Canada Abstract Is m-commerce just an extension or a subset of e-commerce? Will it turn out to be just more hype? In this paper we discuss the realities of m-commerce and the major differences between mobile commerce and Internet-based e-commerce. Based on this understanding, we identify key factors that must be taken into consideration in order to design valuable m-commerce applications.We emphasize that the success of m-commerce relies on the synergy of three driving forces: technology innovation, evolution of a new value chain, and active customer demand. Key words m-commerce, e-commerce, wireless communication networks Jason J. Zhang is currently a Ph. D. student in Information Systems at Michael G. DeGroote School of Business, McMaster University, Canada. He received his M. E. degree in Information System Engineering at t he School of Management, Dalian University of Technology, and B. E. degree in Computer Science & Engineering at North China Institute of Technology, P.R. C. He once worked as an IT consultant for Office Automation (OA) for the Chinese government. His research interests include e-commerce, e-government, supply chain management, m-commerce, and agent-facilitated decision support systems. Yufei Yuan is currently a Professor of Information Systems at Michael G. DeGroote School of Business, McMaster University, Canada. He received his Ph. D. in Computer Information Systems from The University of Michigan in U. S. in 1985. His research interests are in the areas of web-based negotiation support system, business models in electronic ommerce, approximate reasoning with fuzzy logic, matching problems, and decision support in health care. He has published more than 30 papers in professional journals such as International Journal of Electronic Markets, Internet research, Fuzzy Sets and Systems , European Journal of Operational Research, Management Sciences, Academic Medicine, Medical Decision Making, International Journal of Human-Computer Systems, and others. Norm Archer holds the Wayne C. Fox Chair in Business Innovation, and is a Professor of Management Science and Information Systems in the Michael G.DeGroote School of Business at McMaster University. His research interests are in topics that relate to eBusiness, including business-to-business implementations, intelligent agents, and the human-computer interface. He has published in a number of journals, including Internet Research, International Journal of Management Theory and Practice, IEEE Transactions on Systems, Man, and Cybernetics, International Journal of Human-Computer Studies, International Journal of Technology Management, and others. 1. Introduction What is mobile commerce?Is it just hype? Almost every company in telecommunications is trying to figure out what m-commerce really is, and how to exploit it. From the marketers’ vision, in the new world presented by m-commerce, consumers can use their cell phones and other wireless devices to purchase goods and services just as they would over the Internet using their personal computers (PCs). Specifically, m-commerce is about content delivery (notification and reporting) and transactions (purchasing and data entry) on mobile devices (Leung and Antypas, 2001).Unfortunately, in reality, m-commerce is often a highly frustrating experience. Industry observers attribute this drawback to the immaturity of mobile technology, but they believe 3G (third generation wireless digital cellular telephone technology) networks could change the situation (Cohn, 2001). While m-commerce is still in its infancy, enhanced devices and networks are irrelevant unless m-commerce applications are compelling and user friendly. Most often m-commerce is understood as mobile e-commerce (Donegan, 2000; Schwartz, 2000; Liebmann, 2000).M-commerce is supposed to enable us to buy everything from anywhere over the Internet without the use of a PC. Internet access and Web browsing is assumed to be the key to extending m-commerce to customers (Harter, 2000). In many ways, m-commerce is the continuation of e-commerce with the palm handheld, wireless laptops and a new generation of Web-enabled digital phones already on the market (Keen, 2001). Thus it was once believed that if you brought together mobile communications and the Internet, two of the biggest things in telecommunications, there would be an almighty explosion of growth.However, it has not happened yet. In many ways, m-commerce and the wireless Internet have been the victims of over-excited speculation (Darling, 2001). Among 1,700 people surveyed in Spring 2000 by Jupiter Communications, the majority said that they would not use nor pay for the wireless Web (Lindsay, 2000). WAP (Wireless Application Protocol) services were disappointing, particularly in Northern Europe countries, where mobile communications are most advanced and consumers know well the limitations of the wireless Web (Monica, 2000).Consequently, the enthusiasm that originally greeted the concept of the mobile Internet has waned. Contrary to conventional perspectives on m-commerce, forward-thinking marketers should not view m-commerce as e-commerce with limitations, but rather as wireless in its own unique medium, with its own unique benefits (Cotlier, 2000). Even though wireless technology is sometimes regarded as an enhancement tool rather than a brand new medium (Ramakrishnan, 2001), successful players in the m-commerce market space must take a much broader view of the technology, the market, and potential consumers.M-commerce is not simply a new distribution channel, a mobile Internet or a substitute for PCs. Rather, it is a new aspect of consumerism and a much more powerful way to communicate with customers. Obviously, people will not shop with their phones in the same way they shop with PCs. Unleashing the value of m-commerce requires understanding the role that mobility plays in people’s lives today. That calls for a radical shift in thinking (Nohria and Leestma 2001). In this paper, we will identify driving forces for the success of m-commerce.To clarify the nature of m-commerce, we discuss several fundamental differences between m-commerce and Internet-based e-commerce. Based on this new perspective of m-commerce, we identify a set of key factors that should be considered by marketers as well as consumers in making decisions concerning m-commerce applications. Finally, we propose that the synergy of three driving forces will lead to a greater likelihood of success for m-commerce. 2. Key differences between m-commerce and e-commerceAs we argued, m-commerce is not simply an extension or a subset of e-commerce. In fact, there exist fundamental differences between m-commerce and e-commerce in terms of their origins, technologies and the nature of the services the y can offer. 2. 1 Origin The emergence and development of e-commerce was due to the rapid growth of the Internet. The Internet originated from several U. S. government-sponsored programs (ARPANET, CSNET and NSFNET, etc) aimed at providing a networked computing environment for researchers (Kalakota and Whinston, 1996).Starting from the early 1990s, the Internet was extended to business community applications. With such great business potential and rapid growth to millions of users, the term â€Å"electronic commerce† was coined, and e-commerce applications expanded rapidly (Turban et al. , 1999). Because of widely-expanding networks and nearly free access to the Internet, e-commerce bridges distances and enables companies to display and sell goods and services cheaply to consumers and businesses around the world.In the Internet world, much is given away free or at a discount in the hope that a way will eventually be found (presumably through advertising income) to turn traffic into profits. Contrarily, m-commerce is rooted in paid-for service in the private mobile phone industry where business competition is stiff. In the telecom world, users pay for airtime, by the size of the data packet transmitted, and by the service used for what they get (Fox, 2000). Global wireless networks are segmented and owned by different mobile operators such as AT&T, Pacific Bell Wireless, Vodafone, Orange, Deutsche, NTT DoCoMo, etc.Compared to almost free Internet access, high cost has been seen as a major characteristic of m-commerce (Shim and Rice, 2001). Mobile communication through cell phones is costly, and any additional services will attract extra charges. The reason is that establishing a mobile communication network requires heavy business investment with no government support (Ramakrishnan, 2001). M-commerce carriers therefore must look for a great deal of business activity to generate revenues that justify the huge infrastructure investments (Lamont, 2001).Due t o their different origins, the customer bases of m-commerce and e-commerce are quite different. Researchers and university educators were the early users of the Internet. The Internet user population was originally dominated by highly educated people. As Internet household penetration increases, the demographics of users continue to shift closer to those of the population at large (Pastore, 1999). This growth pattern is clear in U. S. and tends to be repeating in the rest of the world (http://cyberatlas. internet. com/ big_picture/demographics).In contrast, other than business users, most cell phone users are young people or relatively less well-educated consumers. Over the next decade, billions of people will gain access to mobile devices, but many of them will be functionally illiterate and technologically unsophisticated users (Feldman, 2000; Barnett et al. 2000). Because of their differences in background, consumers tend to have quite different expectations for m-commerce, compa red to e-commerce. For example, one reason for the low uptake of the wireless Internet in the U.S. is that most Americans already are familiar with the wired Internet and expect to pay for wireless Internet access as they do for wired access: unlimited access for a flat monthly fee (Fox, 2000). 2. 2 Technology The Internet, the fundamental infrastructure of e-commerce, adopted a well-established protocol, TCP/IP (Transmission Control Protocol/Internet Protocol), which solves the global internetworking problem and ensures that computers communicate with one another in a reliable fashion. Over the past everal years, the World Wide Web (WWW) has come to dominate Internet traffic, and the vast majority of e-commerce applications are Web-based. It is also easy to connect the Internet with existing business information systems. Uniform Internet standards significantly reduced e-commerce entry costs and helped fuel the rapid growth of e-commerce. In contrast, m-commerce services are constr ained by a variety of wireless media communication standards ranging from global (Satellite), regional (3G, IEEE 802. 11a/b, DoCoMo I-mode), to short distance (Bluetooth) (Shim and Rice, 2001).Cellular carriers use different systems and standards such as GSM (Global Service for Mobile), TDMA (Time Division Multiple Access), and CDMA (Code Division Multiple Access) to compete with each other (Leung and Antypas, 2001). M-commerce applications tend to be device and carrier dependent. The wireless applications today primarily use two technologies: WAP and SMS. WAP (Wireless Application Protocol) is the display language designed for cellular handhelds. It was created by Motorola, Ericsson, Nokia and Phone. com in 1997 when they founded the WAP Forum.WAP is a derivative of the XML/HTML language family, but it is designed to operate without a keyboard or mouse. SMS (Short Message Systems/Services) is a derivative of the old numeric paging network, with additional functionality for two-way communication and support for text and attachments. There are more users of SMS today than of WAP, thanks to cheaper service and the widespread availability of low-cost, two-way paging devices from companies such as Motorola (Leung and Antypas, 2001). Until now, there has been no generic world-wide framework and standard for application development using universal mobile connection and access.In fact, wireless technology is still in its infancy and hindered by limited coverage and a smorgasbord of competing standards, which can explain the slower-than-expected adoption of m-commerce in the United States (Shim and Rice, 2001). Choosing from conflicting standards, products and features, gives even hardened technophiles a headache. The pyramid of m-commerce applications thereby presents a much more complicated process, in which many pieces must fall into place before the mobile phone can be seen as a real revenue generator.In addition to underlying networking infrastructure and standar ds, it is the client devices that actually determine what specific services can be delivered. The boom in e-commerce applications is actually due to the widespread use of PCs, which have a complete text input keyboard, large screen, substantial memory, and high processing power. Contrarily, various m-commerce applications rely on the use of handheld devices. These devices range from pagers, cell phones, and palmtops, to pocket PCs.Mobile devices such as cell phones and PDAs (Personal Digital Assistants) have tiny screens, some of which display only three lines of text at once (Lucas, 2001). The displays are black and white with low resolution; there are no QWERTY keyboards, and no support for animation (Leung and Antypas, 2001). Although WAP devices support a limited graphics format called Wbitmap, because mobile devices have limited bandwidth and small screens, any application that is heavily graphic or animation driven would not be suitable at this time.In addition, software appli cations are relatively crude. There are no cookies or session controls, meaning that if the connection is lost, the application will restart rather than continue from previous screens (Leung and Antypas, 2001). Web browsers and drop-down menus are unavailable, so companies must plan on character-based terminal applications with cursors and key entry forms. Long selection lists or deep menu layers will wear out the fingers of even the most patient users (Moustafa, 2000; Jainschigg and Grigonis 2001).However, in contrast to PCs, cell phones do have their own unique features: mobile, portable (small size), smooth voice communication, and connected to persons (primarily because of portability) rather than to home or office. 2. 3 The Nature of Services The wide accessibility of the Internet makes any e-commerce service globally available. The Web enables search and delivery of rich information, and sophisticated electronic transaction processes can be integrated easily with backend enter prise information systems.In contrast, the delivery of m-commerce applications relies on private wireless communication carriers. These services are usually delivered to a specific region, and are rather simple, more personalized, location-specific and time-sensitive. Since a mobile device usually accompanies a person wherever he or she goes, mobile services can be delivered to a person anywhere and anytime rather than to a fixed office or home. M-commerce therefore creates more of a perception of enhanced intimacy with consumers than other office-based distribution channels.Time sensitive, simple transactions such as movie ticket purchases, banking, and travel reservations are believed to be the key applications that will stimulate m-commerce (Lucas, 2001; Swartz, 2001-2). Other key drivers to m-commerce growth are location-based applications such as traveler navigation, emergency response, etc. (Secker, 2001; Rockhold, 2001; Swartz, 2001-1). Finally, in general we categorize Inter net based e-commerce into B2C (business to consumer) and B2B (business to business). The rapid growth of e-commerce started from the booming of dot. com companies aimed at online shopping and customer services.Gradually, the emphasis shifted to B2B, and more recently e-business, to take advantage of the real business value of the Internet. In contrast, mobile commerce started from person to person communication, and gradually more services were introduced through interactions between people and systems: checking the weather, finding a local restaurant, etc. M-commerce applications can be used to serve both consumers and business people. Rather than apply B2C and B2B classifications to m-commerce, P2P (Person to Person) and P2S (Person to System) would be more appropriate to address the nature and trend of m-commerce applications.The details of m-commerce applications will be discussed in the next section. The major differences between m-commerce and e-commerce are summarized in Tabl e 1. Table 1. Major Differences Between M-commerce and E-commerce | | | | | |E-commerce |M-commerce | | | | |ORIGIN | | | |Sponsorship |Government-sponsored Internet |Private mobile phone industry | |Business entry cost |Low |High | |Customer access cost |Free or low cost Internet access |High mobile service charge | |Customer base |Highly educated computer users |Less educated cell phone customers | | | | | |TECHNOLOGY | | | |Message transmission |Packet-switched data transmission |Circuit switched for streamlined voice | | | |communication | |Protocol |TCP/IP, HTTPML |GSM, TDMA, CDMA, 3G | |Standardization |Highly standardized |Multiple incompatible standards | |Connectivity |Global |Mainly regional | |Bandwidth |High |Low | |Identity |URL with IP and domain name |Phone number | |Application development |General computer applications |Device-specific applications | |Interface device |Personal computers |Cell phones and PDAs | |Mobility |Fixed location |Mobile | |Display |Big scr een |Small screen | |Main input mode |Keyboard for full text input |Voice with small key pad | |Main output mode |Text and graphics |Voice with small text display | |Local rocessing power |Powerful CPU with large memory and disk space |Limited processing power with small memory chip | |Software and Programming |Support a variety of programming languages |Java or specific script languages | |Trend |Towards sophistication |Towards minimization | | | | | |SERVICES | | | |Service range |Global |Regional | |Delivery destination |PC in office connected to the Internet |Person accompanied by a mobile device | |Transaction complexity |Complete and complex transactions |Simple transactions | |Information provided |Rich information |Simple and short messages | |Timing |Less time-critical |Time critical | |Location-based service |No |Yes | |Target mobility |Service to a fixed point |Service to a moving target | |Backend business connection |Strong connection to backend business information | Weak connection to backend business information | | |systems |systems | |Service classification |B2C (business to consumer) and B2B (business to |P2P (person to person) and P2S (person to system)| | |business) | | 3. Key Factors in Designing M-Commerce ApplicationsOnce we have identified the major differences between wireless mobile communication based m-commerce and Internet based e-commerce, we can identify the key factors that must be taken into consideration in designing useful m-commerce applications. 3. 1 Mobility M-commerce opportunities can be very significant, if investors understand consumer groups intimately and develop ubiquitous solutions that recognize the role that mobility plays in consumers’ lives (Nohria and Leestma, 2001). In business services, not being forced to be hardwired enables a company’s employees to remain connected while moving from office to office, or state to state; they can tap into the corporate network from airport lounges and hotel lobbies.For individual consumers, mobile devices basically allow them to keep in touch with their friends and families anywhere and anytime. For instance, videophone users can take pictures wherever they go and send them attached with short notes to friends while shopping, traveling, or simply hanging out (Kunii, 2001). Beyond person to person mobile communication, additional value can be generated by linking mobile consumers and existing services. Mobile consumers can access various services anytime and anywhere, presenting new marketing channels for businesses. While traveling, a user may use a mobile phone to control a home burglar or fire alarm system and to turn lights on or off as if at home (Fox, 2000). 3. 2 Personal identity and built in payment mechanismsSince mobile devices, particularly cell phones, are registered by their subscribers and normally accompany the person, it becomes possible to identify and deliver personalized services to the user. A cell phone with additi onal security information such as a PIN number or biometric identification technology can be used to identify a person. A payment mechanism may also be built into the cell phone system. It is then possible to allow consumers to use their wireless phones as devices to make or trigger a payment (bus ticket, vendor machine etc. ), similar to the use of a smart card or an ATM machine. And there are even a few vending machines that let users pay for soft drinks using their cell phones (Fox, 2000). Credit card numbers could also be replaced by cellular phone numbers for wireless transactions.Relying on a third party payment mechanism is always a big hurdle for Internet-based e-commerce because an IP address cannot identify a person. However, this difficulty could be easily overcome in m-commerce with the use of an identifiable mobile device. Hence, cell phones naturally support e-Wallet applications in m-commerce, which is crucial to the success of other applications. Certainly, systemati c security solutions involving PKI (Public Key Infrastructure) and biometric services should be adopted as well (Young, 2001). As an example Obongo has modified its e-wallet software for use on wireless devices. A so-called m-wallet contains the cardholder’s account data, name, and mailing address, and is accessed with the push of a button.Once opened, the data within the wallet are transferred to the merchant to complete the payment (Lucas, 2001). M-wallets make micro-payments easier and help carriers charge for advanced services such as digital media and game applications that consumers cannot get any other way (Swartz, 2001-2). Besides financial services, personalization in m-commerce can migrate into entertainment (music and games, etc), content services and even personalized marketing. Since mobile operators maintain personal information on subscribers, a CD vendor, for example, could simply ask customers to verify payment information and a shipping address through their cell phone displays rather than have them fill out forms each time from scratch (Barnett, et al. 2000).Good potential applications of the content revolution are personalized software that deliver highly targeted offers for large- or small-ticket items that consumers can act upon, even while waiting in line (Lucas, 2001). 3. 3 Location-Based Services To date location-based services have been regarded as key enablers of m-commerce’s future success, according to the current hype (Swartz, 2001-1). Portable geographic positioning systems (GPS) are becoming smaller and more affordable, at costs in the neighborhood of only about U. S. $200. These systems can be used not only to identify locations, but also for business to deliver location-sensitive services to users. The ability to target rich and relevant information to end-users provides great potential value in location-based applications.For instance, it would be quite useful to provide driving directions and local commercial s ervices where users happen to be, such as near specific restaurants, movie shows, bus schedules, weather reports and guided tours in museums (Shaffer, 2000; Taaffe, 2001). Hence, one of the selling points of m-commerce applications is proximity. Go2Systems, in Irvine, Calif. , one of a swarm of vendors eyeing the uses of ALI (automatic location identification) data, linked with Coca-Cola to steer wireless customers to stores selling Coke products (Jones, 2000). Coca-Cola, the world’s best-known brand, has ventured into the wireless world by providing its fountain clients (McDonalds, Burger King and more than 800,000 U. S. estaurants) with the opportunity to attract additional business by placing their names on Go2 Systems’ wireless services. Their 5-year, U. S. $30-million deal will allow customers to find the nearest Coke fountain location through their cellular phones with Go2 location-based direction services, which include addresses, turn-by-turn directions and one -click calling (Swartz, 2001-1). CT Motion, a location-based services developer, provides an m-coupon application, by which the mobile user can receive an electronic coupon from a retailer in his or her specific location (Secker, 2001). Imagine that a young teenager is riding his skateboard through the park on a Saturday afternoon, when his cell phone beeps.It is a message from the Soda X portal that the local professional soccer team is playing tonight, and the store that he is approaching is offering him half-price tickets for the game if he buys a pair of jeans today. Privacy concerns are critically important while implementing location-based advertising. Pull mode may resolve the issue of privacy, when a mobile user requests information and is willing to receive an advertisement (Secker, 2001). However, many location-based applications are still to be developed; few carriers have a strategy, let alone a business model (Swartz, 2001-1). Location-based services would have to be ta rgeted extremely well, in order to avoid damaging trusted relationships that merchants already have with customers.Location can be traced not only for people but also for other objects. Cellpoint, a supplier of location-based services (LBS) software, provides the applications used to track remote assets such as fleet vehicles and construction equipment, and also provides telemetric products that allow remote machine-to-machine communications (Secker, 2001). It is also possible to trace a stolen car or a missing child that is carrying a specially designed radio device. 3. 4 Time-critical impulse purchasing Mobile phones are carried by their owners almost everywhere and kept switched on most of the time, especially in Europe, where mobile users are not charged for incoming calls.Consumers can thus not only gain access to wireless services wherever there is a network presence but also keep tabs on time-critical information such as stock market reports or urgent messages. Time-sensitive and simple transactions are another key to stimulate m-commerce. For some applications of m-commerce such as scanning news or purchasing books or other retail items, real-time transactions are not necessary. Nonetheless, there is a great deal of value in being able to monitor dynamic information through wireless handheld devices, such as aircraft flight status, shipping status, seat reservations or stock prices, and to alert the user when the information is updated (Shaffer, 2000; Schwartz, 2000; Leung and Antypas, 2001).There will be even more value in emergency situations such as medical care, traffic accidents, emergency road service, and crime reporting. Particularly with the mandatory ALI (automatic location identification) data supplied by a few key vendors such as Xypoint, U. S government emergency systems like E911 (Enhanced 911) could be improved (Jones, 2000). The United States’ FCC (Federal Communications Commission) mandates that the location of wireless callers be identified during a 911 emergency call. The MapInfo ® (www. mapinfo. com) Location Management Platform (LMP) is used to enhance a carrier's 911 service by automatically routing 911 calls to an appropriate Public Safety Answering Point (PSAP) for handling and dispatch. 3. 5 Special Market NichesMass-market consumers will be the really big users of m-commerce applications. And the customer base is large enough for potential revenue in the medium to long term (Sweeney, 2001). A single killer application would not work for everybody and there is going to be a whole set of niche applications that are relevant to each target audience. The mobile industry believes that location-based service advertising will have stimulated m-commerce so much that operators would eventually offer free phone charges to subscribers who are prepared to have advertising on their screens on a permanent basis. In particular, youth has a very powerful influence on this market (Secker, 2001).Actually, young p eople have been a major target of various m-commerce applications, particularly SMS and DoCoMo iMode services (Herman, 2000). Besides focusing on youth, mobile operators also suggest marketing future mobile data technology much more aggressively to business users (Parsons, 2000). In any case, for new m-commerce opportunities, carriers should be cautious about implementing applications that require changes in consumer behavior. If many technology hurdles are to be overcome, along with a corresponding unreasonable change in behavior, the application is unlikely to succeed. Additionally, price marketing is by far the most important in creating m-commerce value (Lamont, 2001).Mobile carriers therefore need to develop unique offerings for each target market segment or services targeted, according to geographical location and demographics (Schneiderman, 2001). Learning about and analyzing customer psychology, and taking marketer perspectives would help carriers segment the mass-market and target specific to m-commerce applications. We actually need to shift our way of thinking to exploit the uniqueness of m-commerce applications that can be brought to bear in our lives, rather than to be confined to thinking within the limitations of mobile devices. The factors that need to be considered for m-commerce applications are summarized in Table 2.Table 2. Key Design Factors and Typical Applications | | | |Factors |Typical Applications | | |Mobile communications (for business and personal contacts) | |Mobility |Scheduling and coordination (: e. g. appointment arrangements, reminders, | | |teleconferencing, etc. ) | | | |Location-sensitive |Travel navigation (driving or walking directions) | | |Local tours (exhibitions, shopping malls, etc) | | |Locating local services (restaurants, gas stations, etc) | | |Locating moving objects (missing children, stolen cars, etc) | | |Short Message Services (SMS) | |Time-critical |Time-critical information (flight schedules, weather rep orts, traffic information, stock| | |prices) | | |Emergency services (medical care, accident and rescue services, crime stoppers) | | |Personal identification (secure entrance with biometrics check) | |Personal identity |Electronic payments (e-Wallet) | | |Personalized location-aware advertisement | | |Language-specific services (automatically switch to or translate to desired language) | | |Demographic segmentation (oriented to young people or business people). | |Special market niche-targeted |Country segmentation (tailored to specific country) | | | | 4. Synergy of Three Driving Forces For m-commerce growth we identify three major forces that impel its growth: technology innovation, evolution of new value chains, and active customer demand.We propose that the synergy of these three forces will eventually lead to the success of m-commerce applications. 4. 1 Technology Innovation Technological progress is likely to bring about some novel applications for m-commerce. Here we identi fy several major technologies, improvements in which are expected to have a significant influence on m-commerce. The primary concern is with the capabilities of handhelds, the fundamentals of mobile networks, the accuracy of geographic location information, and security solutions. (1) Handhelds Low-cost, truly pervasive devices that present multi-modal information and perform transactions naturally can dramatically change what many people do and how they do it (Feldman, 2000).In the next several years, wireless devices will improve in interface design and information presentation. In countries like China and Japan, where the written language has never fit well with a Western keyboard, handhelds that employ handwriting or speech recognition seem ideal (Herman, 2000). Wireless keypad mnemonics can also make the entry of data easier for consumers (Young, 2001). Subscriber identity modules (SIMs) may take over due to their competitive advantage over voice or keystroke activation (Chanay , 2001). Newer devices will use expandable color screens capable of displaying up to 12 lines of text, more user-friendly keypads, and higher communication bandwidth (Lucas, 2001).Smart card memory capacity will reach 1MB by 2005. The processing capability of smart cards has increased and has given users the ability to enjoy more computationally intensive, high-value, transaction-based operations that require such features as digital signing and encryption (Moustafa, 2000). For those who crave the cutting edge, there are DoCoMo’s (in Japan) impressive third-generation handhelds, which can capture and send high-quality color movies almost in real time (Kunii, 2001). By using a DoCoMo camera-phone, it is possible to imagine being in a store shopping for a gift for a child and calling your spouse to show her what you are thinking of buying.Besides improvements in user interfaces, applications and underlying middleware configurations will allow for interactions to switch communic ation modes smoothly without losing clarity or the thread of conversation. The Java Card Forum has developed specifications for implementing Java on smart cards. Support of Java on SIMs will allow wireless terminals to reach the Java developer community, simplifying the development of new services (Carrara, 2000). Overall, next-generation devices are expected to combine the functions of Personal Digital Assistants or PDAs (data exchange) and cell phones (verbal communication). (2) Network infrastructure The current (second) generation of wireless networks and handhelds supports data rates of only 9. 6 kilobits per second, far below the 64 Kbps capabilities of landline copper wires.GSM (Global System for Mobile Communication), the most common cellular standard, is being extended by the GPRS (General Packet Radio System), which can support data rates of 112 Kbps, almost twice the rate of a standard computer modem and enough to support high-quality streaming audio. True third-generatio n (3G) networks, based on the UMTS (Universal Mobile Telephone System) standard, are predicted to raise the maximum rate to 2 Mbps — one-fifth of the bandwidth available on the standard Ethernet in today’s offices (Barnett et al. 2000) According to Ovum, 3G will first take hold in Asia and Europe, with the rest of the world trailing a year or two behind (Fitchard, 2001).Currently, the leader in the field is Japan’s existing second-generation, or 2G, digital networks that provide always-on connections for data transmission and support a wide range of online services – from news, weather, and ticket-booking to downloads of games and ring tones (Kunii, 2001). Therefore, in the next several years, hybrid elements of 2G, 2. 5G and 3G will be in play simultaneously on wireless operator infrastructure. Bluetooth is a short-distance, radio-based, point-to-point technology that, theoretically, can go up to 1 Mbps, and has already entered the market (Herman, 2000). It will be very useful for enabling location-based applications. It allows a wireless device to exchange data with PCs, laptop computers, point-of-sale devices and other wired devices without being physically connected by wires or adapters.Bluetooth is supported by more than 1,400 telecommunications and technology companies, including Motorola, Intel, and Lucent Technologies (Lucas, 2001). (3) Geographic location technology Location-based personalized services have been heavily touted as a major application for m-commerce. In order to deliver such services, mobile devices (particularly cell phones) should be able to keep track of an individual’s physical location as he or she moves about. Some companies are focusing on underlying technologies or services such as radio-based methods for determining where users are calling from, or software and systems that blend location data with other information (Shaffer, 2000).The FCC (Federal Trade Commission) has stringent requirements for location services, in which carriers have to offer network-based systems that deliver location information with an accuracy of 300 meters for 95% of calls and 100 meters for 67% of calls (Brewin, 2001). For instance, an FCC ruling requires all wireless carriers to find a way to pinpoint the location of the users dialing 911 emergency services. Although the requirements are meeting resistance from various carriers that say they cannot reach that level of accuracy or at least need more time to do so, some can meet the requirements with the portion of their networks that uses the GSM (Global System for Mobile Communications) standard. (4) Security technology The lack of security is said to be one of largest barriers in delaying m-commerce implementation.In particular, security is a vital issue that affects the use of mobile technology in financial services, when account details and other confidential information move across the networks (Dezoysa, 2001-2). With regard to securing tr ansactions, PKI (public key infrastructure) is believed to be the best method to secure end-to-end transactions (Moustafa, 2000). Besides securing wireless transactions from the cell phone to the m-commerce provider, the phone must also be secured from fraudulent use. Traditionally, the SIM card that stores the subscriber’s account information is used for identifying and authenticating the subscriber to the network. There are industry standards for SIMs used in digital wireless phones that help ensure that all SIM-based terminals can support any SIM applications and services a provider develops (Carrara, 2000).Dual chip phones even have an additional SIM-size slot for an independent multi-application chip card targeted at payment, such as a bank-issued WIM card (wireless identification module) or EMV card (a payment standard defined by Europay, Mastercard, and Visa International) and other banking solution applications (Dezoysa, 2001-2). In the near future, wireless biometric services will emerge as a common solution (Young, 2001). A biometric is a unique physical or behavioral characteristic of the human body, which may be checked automatically. The absolute verification of a user makes biometrics the highest security level. Biometrics come in many forms.In 2000, fingerprints were the most widely used biometric, accounting for 50% of the market, followed by hand geometry (15%), face recognition (12%), voice recognition (10%), handwritten signature recognition (8%), and iris scan (4%) (Biometric Industry Report, 2001). In recent years, biometrics have gone digital, and modern electronic systems are capable of distilling the arches, loops and whorls of conventional fingerprints into a numerical code. As an example, Champion Technology, a Hong Kong company, has launched a fingerprint recognition system, which takes only a few seconds to accomplish recognition (Leary, 2001). Biometric authentication offers some promise of strong and convenient security for cell phones, in which the subscriber’s signature or fingerprint can be thought of (mathematically) as a large random number (Crowe, 2001).These are easy for the owner to present to a machine but difficult for others to fake, and they cannot be lost, stolen or borrowed. The growing m-commerce industry eventually will settle on a set of solutions to all of the different security problems, building end-to-end solutions that are secure, cost effective and easy for consumers to use. However, successfully implementing good quality solutions relies upon the acceptance of standards (either de facto or negotiated) within the highly interdependent functions of this industry. 4. 2 Value Chain Evolution As we discussed above, m-commerce is primarily rooted in the cash-rich mobile phone industry.Therefore, equipment vendors and network operators have been dominant in the m-commerce world. And in some sense, the mobile operators own virtually all of the value chains (Donegan, 2000). Unfor tunately, this operator-dominated value chain is not able to successfully deliver flawlessly integrated personalized services for mobile phone users, which is crucial to the success of m-commerce (Swartz, 2001-2). In theory, mobile operators could compete at all levels of the m-commerce value chain, from the provision of basic technical services to the supply of lucrative, customer-facing content, but this is simply not possible, since this will spread their skills and resources too thin.This has been abundantly demonstrated in the e-commerce marketplace, where different companies tend to invest and to focus on their specific expertise at particular levels of the value chain. There are some exceptions, where dominant companies such as Microsoft and General Electric attempt to extend their reach vertically. Companies normally should concentrate on areas in which they naturally hold a competitive advantage. In m-commerce, mobile communication operators thus need to make difficult deci sions about which parts of the value chain to compete in – and how – and which parts to avoid. There are many critical roles that they may be able to play and a number of business models that may be suitable in these roles (Tsalgatidou and Pitoura, 2001).Some mobile data industry observers believe that, although Europe has a more advanced mobile communication infrastructure, the European approach to the m-commerce market will fail (Darling, 2001). They suggest that many European service providers want to own the customers and to support all the applications that customers want to perform. Some mobile operators may even want to become banks or content providers in their own right but, even though carriers have all the critical capabilities in place, including location, shopping, e-wallets, promotion and personalization, without partnerships with knowledgeable merchants and intermediaries, prospective customers will have nothing to access. Therefore, partnerships between -commerce providers, interested content providers, and other businesses are critical to the success of m-commerce. Providing complex data services is a very different business from running a voice network, so carriers have to choose partners to provide content, and decide which services to offer their customers. In pursuing value-added services, more entrepreneurial companies have the products and capability to get them integrated and delivered to handhelds (Goldman, 2000). Also, since capitalizing on the promise of m-commerce requires an in-depth understanding of consumer behavior, significant opportunities arise not just for providers of telecommunications services, but also for companies that have a rich and thorough knowledge of consumer behavior.However, from the merchants’ point of view, building m-commerce applications will present huge challenges, so companies need to leverage superior consumer insights to develop powerful branded solutions with value outside their t raditional markets, particularly when forging alliances with telecommunications carriers (Nohria and Leestma, 2001). In a value chain, each party plays its specific role and gets its own benefits. Customer service charges depend on how much value the user receives, so there will be different pricing and business models for individual services (Secker, 2001; Darling, 2001). Revenue sharing in m-commerce value chains, particularly in those of location-based services (LBS), involving mobile operators, equipment vendors and application developers, will require a significant amount of negotiation. As an example, CT Motion is an LBS application developer and equipment vendor, providing operators with a platform to enable deploying and managing LBS.CT Motion licenses its platform to operators, with an initial fee to cover basic hardware costs and licensing. Additional payments to CT Motion depend on the revenue stream from application users. Thus, revenue share will essentially depend on t he value of the application. For example, a company delivering a car theft recovery service is doing most of the work and so it might receive 95 percent of the revenue. For a simple application, the majority of the revenue will go to the operator and the platform enabler (Secker, 2001). In Table 3, we list the roles in an m-commerce value chain, the major players, and their corresponding sources of revenue. Table 3. Roles and Profit Sharing in the Value Chain | | | | |Role |Tasks |Major players |Sources of revenue | |Equipment Supplier |Manufacturing innovative handhelds and |Nokia, Ericsson, Motorola, etc |Selling phones, equipment, or | | |equipment | |sharing revenue with network | | | | |operators for discounted cell | | | | |phones | |Network Operator |Developing and maintaining |Traditional carriers such as |Charges from increased network | | |infrastructure to support mobile data |Vodafone, Orange, Deutsche |traffic | | |communication |Telekom, AT and NTT DoCoMo | | |Service Hosting |Providing basic enabling services such |Existing Web-hosting companies |Shared revenue with application | | |as server hosting, data backup, systems|and system integrators such as |providers | | |integration and security control |Oracle | | |Portal Provider |Offering simple, categorized |Internet portal service providers|Fees charged to application | | |information search facilities crucial |such as Freeserve, AirFlash, |carriers and advertisers | | |to m-commerce applications. |Room33, Microsoft, Yahoo, AOL | | | | |[email  protected] | | |Billing |Handling various sophisticated illing |Network operators such as |Transaction fees or interest | |Facilitator |mechanisms such as air-time-based, user|Vodafone, Orange, Deutsche |charged to merchants or consumers | | |patterns-based, specific |Telekom, AT, NTT DoCoMo and | | | |application-based, location-based, etc |banks and credit card companies | | |Application Provider |Providing various end-user services |Existing Intern et content |Revenue from customers for | | |such as ticket booking, e-mail |providers such as Yahoo, AOL and |services or products purchased | | |checking, news scanning, and |retail merchants (Coca-Cola, | | | |location-based services (LBSs) |PepsiCo, Procter & Gamble, etc) | |To help observe the maturity of the various value chain components of m-commerce outlined in Table 3, and to understand where further development must occur, it is informative to consider the inter-corporate linkages of m-commerce. This can be done according to corporate contributions to required infrastructure, associated support services, and delivery of these services to customers. To this end, we have adapted the well-known University of Texas e-commerce model of Internet Economy Indicators (Whinston et al, 2001). In their model, there are four layers (Internet infrastructure, Internet applications infrastructure, Internet intermediary, and Internet commerce).M-commerce differs significantly from e-commer ce, as we have pointed out, although there is some overlap in the functional nature of both. In our m-commerce value chain model, we also propose four layers: 1) Communications Infrastructure, 2) Applications Infrastructure, 3) M-commerce Intermediary, and 4) Mobile Commerce. Reading from the top of Table 3, the Communications Infrastructure layer includes equipment suppliers and network operators. The Applications Infrastructure includes service hosting, portal providers, and software companies that develop related software products and platforms. The M-commerce Intermediary layer includes billing facilitators, content providers, brokers, and market makers.Finally, the Mobile Commerce layer includes application providers that sell goods and services to customers. The interconnected and interdependent nature of these four layers of the value chain cannot be over-emphasized. Thus evolution in one layer will affect the other layers. For example, advances in the communications infrastr ucture, such as the widespread implementation of G3, will support new developments such as wireless video and bring more potential retail applications of mobile commerce that may be both time and location sensitive. But services to support these will require further evolution in both applications infrastructure and intermediaries. 4. 3 Active Customer DemandWhat is missing from m-commerce is compelling content that will make people want to use their handhelds to buy something. Consumers remain unconvinced about the wireless Web and user apathy towards wireless data services is believed to be one of the main factors delaying m-commerce implementation (Kelly, 2001). We propose that it is current narrowly-focused m-commerce applications (mainly on mobile Web systems) but not the fundamental nature of m-commerce, that frustrates consumers. The great advantage to people of eliminating fixed attachments to physical space, allows more strategic, creative, and flexible decisions and actuall y getting things accomplished (Kalakota and Whinston, 1996).Instead of waiting for killer applications to stimulate passive consumers, we propose that fundamental consumer demand is the active force that can improve the chance of m-commerce success. The success of the cell phone industry has already proved the significance of this active driving force. Today there are an estimated 115 million cellular phone users in the U. S. (Schooler, 2001). Market growth has been quite encouraging. Compared to the U. S, in Asia and Europe mobile telephony adoption is even more advanced (Herman, 2000). In Japan, the number of cell-phone users has already reached 66 million (Kunii, 2001). 64% of the people in Finland have a mobile phone, while the rate in Sweden stands at 55. 2% (Kruger, 2000).In China, the enthusiasm for mobile phones has exceeded all forecasts, and the mobile subscriber base will probably reach 250 to 300 million in 2005, up from 68 million in 2000 (Sliwa, 2001). Recently, the po pulation of cell phone users in China has reached 135 million, making it the world leader. Beyond enjoying the basic service of mobile verbal communication, consumers are beginning to demand much more from their cell phones. Two-thirds of Japan’s cell-phone users subscribe to one of many mobile data services offered by the country’s three cellular operators. Even though the actual demands vary according to different geographical locations and demographics, consumers have played a decisive role in the success or failure of m-commerce efforts.Most potential m-commerce successes will arise from consumer demand for additional value in their daily lives, and there is unlikely to be a single killer application that can spark m-commerce success. What consumers need is an adaptable package that can accommodate various m-commerce services (personalized location-specific and time-sensitive). It is the variety of cost justification criteria adopted by consumers (in turn determine d by demographics, regional cultures, current fashions, etc. ) that fundamentally affect their decisions concerning specific m-commerce services. According to a Nokia research study that focused on m-commerce services in the U. K. South Korea, Italy, USA, Brazil and Finland, the proportion of respondents that would carry out a transaction of more than U. S. $25 using a mobile device, ranged from 24 to 54 percent (Dezoysa, 2001-1). Also, 90 per cent of all end-users surveyed that would consider using m-commerce, either now or some time in the future, would be willing to pay for its use. However, this is on the assumption that the mobile device is free. It is still uncertain whether the cost of next generation phones can be subsidized by operators and, if they are not, how the added cost of paying over $150 for a mobile phone might well affect this figure (Dezoysa, 2001-1). DoCoMo recently sold about 10,000 videophones at a U. S. $500 price, with service limited to Tokyo (Kunii, 2001) .In Europe, the cost of providing advanced handhelds equipped with high tech features is also likely to be in the neighborhood of $500 or more (Carrigan, 2001). For the additional cost of high tech handhelds to be acceptable, consumers will expect to be able to access many additional services that are of value to them. In Europe, where mobile users are not charged for incoming calls, consumers can thus not only gain access to wireless services wherever there is a network presence but also keep tabs on time-critical information such as stock market reports or other urgent messages (Barnett et al. 2000). Such consumers are more likely to take advantage of these services.The focus in m-commerce needs to be on delivering simple, time-sensitive, and compelling applications that do not require a lot of training. If it takes too much time (e. g. more than 5 minutes) to conduct an m-commerce transaction, it might as well be done with a PC. One example is notification about tickets to entert ainment and sporting events. A consumer can contact a ticketing agency, such as TicketMaster, to request notification of availability of tickets for sale for an upcoming concert. When tickets meeting the consumer’s criteria become available, TicketMaster sends a message to the consumer’s wireless device and asks if the consumer wants to buy them or not. This is a simple yes-or-no transaction (Lucas, 2001).Any applications that require consumers to input much information will not work, because of keyboard limitations. For example, a visit to Barnes & Noble’s WAP site to enter credit card number, address, and shipping information requires more than 100 keystrokes (Swartz, 2001-2). 4. 4 Synergy of three driving forces The success of m-commerce relies on the synergy of three driving forces: technology innovation, value chain evolution and active customer demand. Technology innovation provides more useful functions with lower prices, creating value for customers and stimulating customer demand. Technology innovation also demands high-level collaboration through the value chain.Active customer demand provides rich revenue sources for the value chain and stimulates technology innovation and the development of new applications. Value chain evolution ensures the collaboration of multiple parties through appropriate profit sharing, which in turn supports more technology innovation. Through positive interaction loops the three driving forces will eventually contribute to the success of m-commerce. This synergy is graphically illustrated in Figure 1. 5. Conclusions Are we ready for m-commerce? Differing perspectives of m-commerce may lead us to opposite answers. But our research into the nature of m-commerce shows that m-commerce applications are fundamentally different from those delivered in the Internet- based e-commerce environment.Simply transforming e-commerce services to cell phones or PDAs will merely expose the limitations of wireless handhel ds and result in frustrating end-user experiences. Therefore, as we examine any speculation about m-commerce applications, we must attempt to exploit the unique features of mobile devices as well as to avoid their weaknesses. Furthermore, the eventual success of any m-commerce strategy depends on the synergy of the three driving forces we have identified: technology innovation, value chain evolution, and active customer demand. Acknowledgement: This research was sponsored by the research grant from Natural Science and Engineering Research Council of Canada.The authors are grateful for the anonymous referees’ constructive comments and valuable suggestions on the improvement of earlier version of the manuscript. References: Barnett et al. (2000), Nick Barnett, Stephen Hodges, Michael J. Wilshire, â€Å"M-commerce: an operator’s manual†, The McKinsey Quarterly; New York; 2000, No. 3, pp. 162-173 Biometric Industry Report (2001), â€Å"2000 Market Review†, Bi ometric Technology Today, Jan. , pp. 9-11. Brewin, (2001), Bob Brewin, â€Å"M-commerce hits snag as cell carriers balk†, Com

Macy’s Private Label Case Study Essay

There are several private labels and several independent brand labels within Macy’s often amongst each other as a clever marketing technique. However what will attract customers to Macy’s is not the high priced brands but rather their private label brands that often closely mock the established brand style but for a much cheaper price point. People shopping at Macy’s are seeking a deal; otherwise they could shop at Nordstrom’s for a pair of 150-dollar jeans so people often come for the private labels. Macy’s private labels are very clever because of their strategic placing which leads me to say that the private labels are more lucrative to the company than the major brands are. Starting with major brand DKNY which Macy’s sells their mission statement is, â€Å"The mission of the Donna Karan Company, as a design driven company, is to represent the international pulse of New York in the design, marketing and delivery of a complete lifestyle system to a global customer†. DKNY is all about marketing to the New York style consumer who keeps up with East Coast styles and also runs on the more expensive side with a dress averaging around 200 dollars and jeans around 150 dollars. Although the brand is very trendy and made with quality materials one would expect at that price, it simply isn’t really the Macy’s target market. Macy’s consumer expects to shop for deals on the cheaper end as opposed to going to a competitor on the pricey side such as Nordstrom or Bloomingdales. However Macy’s is very strategic in the placing of this brand because it’s generally right next to their private label INC and that proves smart because someone who loves a 300-dollar dress from DKNY can walk over a few feet to INC and find one very similar for much, much less. INC is also urban inspired young contemporary clothing however at a much cheaper price point than the clothing at DKNY. The average price for a dress from the INC department at Macy’s costs from 70-100 dollars. Macy’s is very strategic in merchandising and generally will place INC directly next to brands such as DKNY so that when someone falls in love with that 300 dollar cocktail dress they can ask an associate for something similar and walk a few feet over to the INC department and get the same look for about 200 dollars less. This is smart because Macy’s typical consumer is on the lower end of the financial spectrum and they know people want expensive looks for less money. They use the name brands as bait and lure shoppers in to ultimately buy something from a similar private label, which consumers love because they feel like they are getting a great deal. The INC marketing strategy is very clever and brings in more money than their brand name labels. Overall, INC has the better marketing strategy between the two labels because although people value quality they will take a great deal even if it means sacrificing a bit of quality. The clothing is just as trendy and it’s what ultimately brings in Macy’s target market consumers because they are generally shopping for a great deal. This strategy of using brand names as bait has been the central reason for their success because their goal of maintaining reasonable price points for their customers is prevalent through their private label brands. It’s similar to if you are at the grocery store and want a box of Lucky Charms for 4 dollars then next to it is the same cereal but the store’s private label brand such as Kirkland for only 2 dollars. It’ll taste just a little bit different but not enough to tell the difference off the bat. INC clearly isn’t the same quality of material as a 300-dollar DKNY dress; however at a glance no one can really tell if it’s DKNY or INC it just looks good and this is what matters to consumers at the end of the day. Macy’s should implement more private label brands because these are what make the sales for them. INC wins over DKNY because someone shopping at Macy’s is statistically proven due to finances to be more likely to buy a less expensive private label brand than the pricey brand name item.

Coca Cola – Organization Management

Abstract This paper is about â€Å"Coca-Cola† company which produces and manufactures soft drinks, and this product is well known all around the world for many decades. The materials used to get the information about the company are from the internet, newspaper and the bottle itself. The paper will speak about how the product came to the final result as an output and what does it take to manufacture it. INTRODUCTION Coca-Cola is the most popular and biggest-selling soft drink in history, as well as the best-known product in the world.It is sold in more and more markets, creating thousands of new jobs in the local economies. The brand is owned by The Coca-Cola Company which works with franchisees across the world. These franchisees perform the bottling and canning operations and are also known as packagers. This paper will discuss the following: * What are the stages of manufacturing? * How does the company guarantee the quality of the products to reach customers satisfaction? * What are the steps after guaranteeing the product so that the product to be introduced to the markets? * Conclusion * Important keywords – Stages of manufacturing -Transforming resources Coca-Cola’s bottlers and canners are concerned with a range of processes involved in transforming resources into the bottles and cans of drink that we are familiar with. There is a difference between transforming resources and transformed resources: * The transforming resources are the managers, employees, machinery and equipment used by The Coca-Cola Company and its franchisees. * The transformed resources are the materials (the cans, bottles, liquids, etc. ) and the information which are processed to create the finished product. Manufacturing Coca-Cola Primarily, Coca-Cola is manufactured by franchisees who are the world’s leading bottling and canning companies. This franchise business is strictly controlled by The Coca-Cola Company. Soft drinks manufacture is a competitive business. Manufacturing techniques are continually improved. This helps meet the highest quality standards for its products using the most cost effective production techniques. For example, very small changes in the shape of the can could save a canning factory millions of dollars in production costs. The production of Coca-Cola involves two major operations: Creating the packaging material * Bottling and canning the finished drink. -Packaging For many years, Coca-Cola was produced in glass bottles. Because of the high cost of distributing bulky bottles, they had to be manufactured close to where the bottling took place. Today, this is no longer so important since new packaging methods have revolutionized the process. Advanced bottling and canning technology makes Coca-Cola cans and bottles very light but extremely strong. The Company has invested a lot of time and money in research and development to ensure the most effective life cycle impact of its packaging.By using the minimum quantities of materials in packaging, the cans and plastic bottles are simple to crush or to reprocess at the end of the initial life cycle. -Preparing to fill cans Cans are delivered in bulk to a canning plant. At this stage the cans are shaped like an open cup ready to receive the liquid drink. They are not fully formed because the ring pull end has still to be fitted. After they have been inspected to check that there are no faults, each can goes through a rinsing machine to make sure it is clean and ready for filling. Preparing the drink Coca-Cola consists of a concentrated beverage base and a liquid sweetener which are combined to form the syrup from which the drink is made. The Company ships the concentrate to bottling and canning plants where the franchisees mix it with sugar and local water. The water is passed through a number of filters to make sure it is absolutely pure. Carbon dioxide, which makes it fizzy, is also delivered to the canning plant where it is stored and th en piped into the manufacturing process through a carbonator and cooler.The Company specifies what equipment franchisees will use to carry out these processes. Samples are taken regularly for chemical analysis, and staff makes frequent spot checks to ensure that plants are maintaining the Company’s standards of cleanliness and quality. The Company provides its franchisees with the most up-to-date technology available and many of them use the latest computer technology and statistical process control methods. -Filling the cans The packaging and the finished drink are combined by a rapid filling process.Every minute hundreds of cans pass along an automated production line and are filled with a precise amount of Coca-Cola. As the cans move along the production line, they are seamed to include the ring pull end and produce the finished can. The ends are inspected to make sure they are smooth and do not have any gaps or leaks. An individual code is stamped on the cans so that each one can be traced back to the point and time of production. A date code ensures product freshness. Cans now look like those you will see in the shops. – Guaranteeing the quality of the product The manufacture of Coca-Cola is carried out by a set of processes called continuous flow production. On a production line, a process is continually repeated and identical products go through the same sequence of operations. Continuous flow production takes this one step further by using computer-controlled automatic equipment to produce goods 24 hours a day. The Company and its franchisees use Total Quality Management procedures that encourage everyone in the plant to think about quality in every-thing they do.Every employee sets out to satisfy customers and places them at the heart of the production process. By continually seeking to improve every aspect of production, employees are able to eliminate problems. Throughout the production process, quality control personnel monitor the pr oduct and take test samples. Guarantee that there are no errors; quality control inspectors take statistically selected samples at the end of the production line. Using chemical analysis, these inspectors can guarantee that the product meets the exact specifications; they also check that there are no faults in the packaging.A ‘fill height detector’ uses an electronic eye to ensure that the cans are filled to the right quantity. Cans that are not properly filled are rejected. 3- Introducing the product to the markets Packing the end product into cases The canners then prepare the cans for distribution to retailers such as super-markets, shops and garages. A machine called a case former creates the casing that protects the cans as they are sorted onto pallets. The cans are stored temporarily in a warehouse before they are collected by large distribution trucks. Bottling Coca-ColaSo far this case study has focused on the canning process for Coca-Cola. The bottling process, whether in glass or PET (plastic), is very similar. Each plastic bottle starts as test-tube size is blown up like a balloon into the final bottle shape. Whereas franchisees receive cans that already have the logo and any promotional details on them, bottlers apply the labels from large reels once the bottles have been formed. At the end of the bottling line, bottles are automatically sealed with a cap immediately after they have been filled. Just-in-time Canners and bottlers process vast quantities of materials each week.Receiving the raw materials and delivering the finished products involves a complex sequence of actions. The ideal solution is to make sure that the inputs for the process arrive ‘just-in-time’ so they can be transformed into a finished product ready for transportation ‘just-in-time’ to meet the needs of the retailers. At modern canning plants, the cans maker is often located in an adjoining facility, with delivery through a ‘Hole in the wall’ operation. The packagers are involved created supply chain networks with the supermarket chains and other outlets ensure that this process runs smoothly.Canners and bottlers must ensure that they do not build up large stockpiles of cans waiting to be sold but they must also make sure that deliveries are not late. This is where they benefit from advanced information technology that rapidly relays figures about the demand for Coca-Cola. For example, this demand usually rises in periods of hotter weather so the packagers need to plan increased production. Canners and bottlers work closely with The Coca-Cola Company and other suppliers to provide a smooth running supply chain so that consumers are always within ‘an arm’s reach of desire’ and can always buy a drink when they want one.Performance feedback to canners and bottlers In addition to each canner or bottler’s own quality assurance procedures, sample bottles and cans from each market ar e tested regularly by The Coca-Cola Company. The results are then reported back to the packagers. This feedback helps The Coca-Cola Company and the franchisee to work together and identify opportunities for improvement. Franchisees undergo constant training and retraining in quality assurance, and can always ask for help and advice about ongoing improvement. 4- ConclusionTo produce the world’s best known product, The Coca-Cola Company has to employ the highest quality processes and establish standards which guarantee the production of a standardized product which meets consumers’ high expectations each and every time they drink a bottle or can of Coca-Cola. In order to guarantee these standards the Company has had to develop a close relationship with its franchisees based on a mutual concern for quality. Total Quality management lies at the heart of this process involving a continuous emphasis on getting quality standards right every time and on continually seeking new ways to improve performance. – Keywords Continuous flow production: An ongoing twenty-four hour production cycle in which partly finished and finished products pass along a production line. Cost effective: It’s an approach that minimizes or significantly reduces the cost of operations. Franchisee: An individual (Or organization) that is licensed to produce and/or sell a named product in a given area, in return for a fee, a share of the profits or sales. Global brand: A product that is recognizable across the world by its logo, packaging or distinctive trade mark. Inputs:They are Materials and labor that go into a production process. Just-in-time: Supplies for manufacturing processes are received just as they are needed, and the end product reaches the consumer just when it is wanted. ‘Just-in-time’ reduces the need to carry large stocks of materials or finished goods helping cash flow. Life cycle impact: Examining the impact of a product from the point at which the raw materials start to be produced and assembled, through the manufacturing process, right up to the time at which the consumer finally disposes of the packaging of the product. Operations:The processes involved in the production of a product, such as filling a can, checking that the can is sufficiently filled, etc. Outputs: Goods and services that are produced once raw materials have gone through a transformation process. Performance feedback: It’s about providing information on the success of performances so that improvements can be made. For example, if a weakness is spotted in quality standards, then it would be necessary to inform the packager so that these could be rectified immediately. Statistical process control: The use of mathematical and statistical control processes in the manufacture of products e. . by measuring quantities of fluid used in given processes, measuring quantities of materials used, etc. to ensure that inputs and outputs always meet spec ified quantitative standards. Supply chain: It is the chain of processes that links a manufacturer through a distributor to a customer. Total Quality Management: It is an approach that ensures quality at every stage of production, rather than just at the end of the production cycle. Transformed resources: They are resources, such as raw materials and information that are modified in the process of production by the transforming resources.Transforming resources: They are resources that are used to transform other inputs. ——————————————– [ 1 ]. http://businesscasestudies. co. uk/coca-cola-great-britain/making-the-worlds-best-known-product/transforming-resources. html#axzz2EDxPK7W6 [ 2 ]. http://businesscasestudies. co. uk/coca-cola-great-britain/making-the-worlds-best-known-product/manufacturing-coca-cola. html#axzz2EDxPK7W6 [ 3 ]. http://businesscasestudies. co. uk/coca-cola-great -britain/making-the-worlds-best-known-product/packaging. html#axzz2EDxPK7W6 [ 4 ]. http://businesscasestudies. co. k/coca-cola-great-britain/making-the-worlds-best-known-product/filling-the-cans. html#axzz2EDxPK7W6 [ 5 ]. http://asq. org/blog/2011/11/coca-colas-quality-culture/ [ 6 ]. http://www. supplychaindigital. com/warehousing_storage/supply-tech-coca-colas-plantbottle [ 7 ]. http://www. supplychaindigital. com/warehousing_storage/supply-tech-coca-colas-plantbottle [ 8 ]. http://www. studymode. com/subjects/coca-cola-just-in-time-case-study-page1. html [ 9 ]. http://businesscasestudies. co. uk/coca-cola-great-britain/making-the-worlds-best-known-product/performance-feedback-to-canners-and-bottlers. html#axzz2EDxPK7W6

Investment appraisal under uncertainty Essay Example | Topics and Well Written Essays - 1250 words

Investment appraisal under uncertainty - Essay Example Literature review Real option valuation calls for an elaborate and a firm strategy to form a conceptual tool to make the decision for the company (Kim & Sanders 2002). The most appropriate tool to be used in uncertainty cases is using real option as a technique to assess investments for contexts with high market, technical and technological uncertainty (Billington, Johnson & Triantis 2002). This is because they allow managerial flexibility and option analogy. Real options ensure delaying making a right decision on investment of a company until a time when the right information is obtained to make the best decision. Kim & Sanders (2002) notes that real option approach in this case takes into consideration ascertaining important sources of ambiguity and distinguishing, making, and fostering options whose values comes from responding to new information about the uncertainties. Mun (2002) notes that real options are important in identifying taxonomy of the business. Real options are more important in growth options of the business since they are analogous to financial call options. Longstaff & Schwartz (2001) notes that, real options involve a sequence of investment over a period that makes them preferable than the other capital budgeting decisions. These real growth options thus compound options, where options are formed upon the exercise of previous options. Moreover, real options are better used as techniques to assess investments for contexts with high market, technical and technological uncertainty since they allow companies to make decisions on contracting situations. This can have a significant impact on the value of the shareholder (Li & Johnson 2002). Value Drivers of Real Options Kim & Sanders (2002) notes that value created from the right and not the obligation to acquire or exchange a specific asset, has value even though not ad infinitum. Option value determined by several factors, both quantitative and qualitative. Understanding the above factors enab les managers to make the appropriate decisions in order to exploit them. Uncertainty about the future Real options are determined by uncertainty about the future. This implies that if more possibilities of interacting with the uncertainties exist, then they will create value. This situation is created by asymmetric payoff structure alongside discretionary rights. Time to expiration Real options are also determined by the time to expiration. This situation implies that the more time an option takes to exercise the option, the more valuable the option will become. The reason behind this rationale is that the lengthy time will work to increase uncertainty. However, in other cases, increases in uncertainty are often offset by increased in costs, which are triggered by the lengthy period (Li & Johnson 2002). Time value of money Real options are also affected by the time value of money. This is an essential part since money affects all the sectors of the economy. Monetary policies by the government affect all sectors of the economy and have impacts on investment decisions, which concern undertaking or abandoning the project. Time value of money affects inflation, cost of capital, and macroeconomic stability, which in turn affects real options. The reason behind this is that the interest rate charged by the central banks affects the time value of money, thus exposing real options to political risks. Qualitative factors Real options are

Research Paper Essay Example | Topics and Well Written Essays - 500 words - 1

Research Paper - Essay Example radigms that significantly influence the performance outcome of the businesses have become vital factors of competitive advantage in the contemporary global business environment. Scholars assert that in the contemporary times, resources like machine, factories, human capital or intellectual property can be bought from the open market and therefore, they are not effective resources that could provide competitive edge to a firm (Johnston, Scholes and Whittington, 2005). But Lynch (2003) believes that resource based strategy inherently includes all tangible and intangible assets that enable the firm to conceive of and implement strategies that improve its efficiency and effectiveness and therefore gives it the necessary advantage. It also true that organizational competencies in terms of organizational culture and leadership initiatives that exploit human capital for improved performance outcome is highly relevant element of competitive advantage (De Wit & Mayer, 2005). Hence, the research on the topic would greatly help identify factors and issues that facilitate businesses to gain leverage in the highly competitive business of contemporary times. The proposed research study would be qualitative in nature and would involve comprehensive literature review. Observation and interviews have been two major methods of understanding and evaluating the factors that impact the changing business dynamics. The sample data primarily comprised of observations of general public and local businessmen on the various perspectives of business competition and issues that influence their performance. The results showed the recessive trend had hugely impacted the business outcome and necessitated cost cutting measures to meet the challenges of the time and survive tough economic conditions. It was also found that the globalization and increasing multicultural environment also required more proactive measures to promote cross cultural understanding for improved teamwork. Workplace

Foreground, Middle Ground and Background. Winslow Homer compared to Essay

Foreground, Middle Ground and Background. Winslow Homer compared to Andrew Wyeth - Essay Example The grass in the foreground also suggests that the picture was drawn regarding to the dry spell or the harvest season in Chadds. Christina seems mesmerized by her rural setting, a suggestion of breeze stroking her loose features of hair as she stares in the direction of her home, totally fascinated. Besides, we can note the distinguished passive color palette in the foreground that helps us to differentiate the harvested grass and that which is yet to be harvested. Moreover, the different color used helps distinguish the clothes that Christina is wearing from the where she is crawling. The light sandwiched between the household and the barn is the brightest theme of the painting and Christina is leading her head upwards in the direction of it.   In the middle ground of the Christina world painting, we can note several different features from the foreground. The foreground contains a huge part occupied by dry grass fields. In addition, we can see a huge part of this grass field has been harvested exposing the Christians family home. There is also a path created by a car that is used to access Christians home. At the rear end of the middle ground, there is a fence that surrounds Christians home. In the background of the painting Christina’s World, we can see the the family home where she lives. The painting suggests that she might be living with her family since it shows a huge two storey family home with other structures surrounding it. Among the structures are two large separate houses and a small single structure built in the unharvested grass field. We can also see a huge section of Christian’s family home has a compound with harvested grass. From the picture, we can suggest that the economic activity in the Christian’s World was farming. Content, Style, Axis, Symmetry, and Asymmetry In Christina's World, Wyeth used subdued colors to convey the tranquility of being restricted to a country setting.  Andrew Wyeth’s works merged i nto his established and continuing style characterized by a passive color palette, convincing representations, and the illustration of emotionally charged, symbolic objects or people. Christina's World is based on a real life situation, which he encountered in Chadds, Ford area. This picture is a depiction of a victim of polio disease who tried to crawl up a hill. Christina looks as if fascinated by her rural background, a suggestion of just cuddling her movable filaments of hair as this woman stares en route to her home, entirely captivated. The perkiest part of the sky looks as if to gesture Christina like a blissful white light. A sole figure in the vast countryside, Christina is fairly susceptible to the harsh set up, but embraces it nevertheless to relish the attractiveness of the scene and her freedom. Andrew Wyeth’s, main passion of painting lay on the land and people around him. His works paintings were mainly based in his home town of Chadds Ford, Pennsylvania, and a t his seasonal family home in Cushing, Maine.  His most popular painting was Christina's World, a 20th century art, currently preserved in the Museum of Modern Art in New York City.   This painting portrays his neighbor, Christina Olson, rambling on a dry ground fronting her house. The countryside is in her world is generally dry and unproductive but has a suppleness to it which is bizarrely appealing. An else intimidating scene emits a sense of safety to the onlooker. The addition of a "crippled" young girl alters the background to to some degree obliging and approachable. This meant that Christina Olson had to

The Sales Related Issues of Thorntons PLC Term Paper

The Sales Related Issues of Thorntons PLC - Term Paper Example The industry in which the company operates is very competitive and apt strategies are needed to gain a competitive advantage over other firms. For this purpose a situational analysis will be conducted taking into account both micro-environment and macro-environment. Finally, a SWOT analysis of the company will be conducted in order to understand the present position of the company and the external factors that can benefit or hurt the company in the future. This section will include a commentary on the most important factors of the macro-environment in the chocolate industry. Political The political environment of the United Kingdom is relatively stable. The company does not have to worry about the problems of a turbulent political environment that are prevalent in developing markets. There are although specific regulations regarding marketing of food items that the company has to abide by at all times. In order to prevent childhood obesity, the government is looking to reduce chocola te sizes and that will affect the company (Daily Mail UK, 2009). Regulations such as these can affect a change in production, marketing, and distribution strategy of the company. Economical Economic conditions of the United Kingdom are not ideal and the country is still feeling jolts from the economic recession of 2008. But still, the situation of the chocolate industry is considerably better compared to other industries. The industry has been able to survive the recession and, opposite to other industries, has shown growth as well (Piercy, Cravens, & Lane, 2010). Although the chocolate industry is generally regarded as one of those industries that were able to survive the recession, Hull city’s economic conditions are not good which may not be good news for the chocolate industry. The unemployment level in the city is higher than the country average (Hull City Council, 2011). This is not a good sign for the chocolate companies operating in the region. Socio-cultural The cult ure of gift giving at Christmas is the main reason behind the increase in sales of chocolates in this season.  

Corporate strategy Essay Example | Topics and Well Written Essays - 2250 words - 2

Corporate strategy - Essay Example Understanding PwC Strategic Resources Tallman (2009) argues that resources and capabilities are the sources of internal strengths and weaknesses for a firm because its profitability, growth, and success largely depend upon unique strategic resources that it possesses. Thus, strategic resources need to be unique to create competitive advantage over competition. Moreover, strategic resources play a much vital role in the success or failure of the organization, especially when the organization is a services company. Organization’s capabilities such as managerial abilities, learning proficiencies, fast delivery and ability to find proper solutions to the issues are some of the factors that play a key role in formulating strategic choices. PwC is purely a services company active in the numerous fields such as audit and assurance that include internal audit, financial statement audit, corporate reporting, IFRS reporting, risk assurance, actuarial insurance, capital markets, corporat e treasury solution; consultation services that include services in finance, operations, technology, risk, people and change; deals that include mergers and acquisition tax, corporate finance, business recovery services, transaction services, valuation and strategy; family business services; and human resource services that include talent management, human capital measurement & benchmarking, social security, and many more. A vast human talent pool that PwC has developed over the years is a major driving force in growth of the organization and making the organization one of the most coveted auditing and consulting firm in the world (PwC, 2013). Tackling Today's Challenges – A Capability Perspective Ever since the concept of globalisation has made rapid strides the firms have been facing an increasing challenge to build competitive advantage in the market place. Under the changed scenarios, the firms have been compelled to make strategic collaborations or partnerships; mergers or acquisition to enhance synergy in their operations and reduce their overall costs. In the most dynamic and ever-changing world, organisations need to show enough resilience and adjust to the new situations quickly. Tallman (2009) emphasises that dynamic capabilities of the firm help resolve emerging issues more effectively. PwC is an auditing cum consulting services firm of a long standing. Overtime, the company has acquired numerous capabilities and strategic concepts that have put the company into the forefront in the global audit and consulting business worldwide. The key strength of PwC is a capacity to tackle today's challenges based on depth and breadth of its capabilities. The company serves to the largest of the multinational corporations to small and medium-sized enterprises. The company's clients are from the different geographical areas working in their own business environment to meet their objectives. It would be interesting to explore how PwC has been successfully a ccomplishing various tasks through the following example. Enterprise Architecture– A True Capability Assessment In 2012, International Data Corporation (IDC), a market research firm, conducted vendor assessment of the enterprise architecture (EA) practices of large consulting firms. The assessment took into consideration qualitative and quantitative aspects of the services provided based on certain assigned criteria. IDC analysts framed standard

The Technology of Gender Assignment Example | Topics and Well Written Essays - 500 words

The Technology of Gender - Assignment Example Over the passage of time, with greater representation of women in the workforce, gender has become confined to family matters and insensitivity toward gender is found in the social framework. The technology of gender is the term used to refer to those sets of cultural practices which play a role in making a body gendered. This course’s theoretical basis is the conceptualization and articulation of the human body within particular discourses of culture that include but are not limited to religion, law, medicine, and economy. These discourses are based on the deepest cultural ideologies and belief systems and jointly form a framework that dictates particular ways in which men and women should think, behave, and interact with one another and with the environment. Four propositions made in the article when mentioned chronologically in decreasing order of self-evidence include; gender is a representation, this representation is the construction of gender, the process of gender cons truction is as effective today as it was in the past, and the deconstruction of gender affects its construction. In this article, the author has complimented upon the perception of ideology as being without outside. The author suggests that there does exist an outside to ideology, â€Å"a place from where ideology can be seen for what it is – mystification, imaginary relation, wool over one’s eyes; and that place is†¦scientific knowledge† (de Lauretis). I would like to second the author in this because science does provide an explanation for a phenomenon on the basis of objective reasoning and logic. Characterization of the subject of feminism by the movement as ideological representation in and out of the gender is a back and forth movement between gender representation and what is made unrepresentable by the gender.

Does N.I.E. help a business assess the risks when considering Foreign Assignment

Does N.I.E. help a business assess the risks when considering Foreign Direct Investment - Assignment Example The growing inequality and the gap between rich and poor countries have put questions on the ability of foreign institutions having solution. NIE also suffers from the means of measuring variables discussed in the theory such as transaction cost. 13 Conclusion 13 Introduction In order to fully understand and analyze the role of new institutional economics (NIE) in risk assessment of foreign direct investment (FDI), we first need to develop a sound understanding of the new institutional economy and various aspects of foreign direct investment. In this paper I will discuss what is New Institutional Economics and its background; and how it is dissimilar from traditional economics. Its various impacts and demands will also be discussed. I will also discuss help of NIE in finding solutions which were previously unresolved. What change in system is required for its implementation? NIE is not without its shortcomings it also poses some problems. In this paper we will try to analyze the impa ct of NIE on foreign direct investment. ... believe 1(Barnard Chavance, 2009) that importance of institutions can also be analyzed with the instruments of standard economic theory with some adjustments. He emphasized on the absence of existence of the firms in the conventional economics. He uses the cost of using the price mechanism as his basis. The search of appropriate prices and negotiation of separate contracts can be costly for individuals. Hence an individual volunteers himself under the authority of an organization or entrepreneur to sell his services to the market. Hence market transactions are eliminated and firm replaces the market thus economizing the cost of price determination. He developed the concept of transaction cost. Differing cultural values provide an advantage. The nature of the labour force shows that the cost of overcoming the difference in culture is sometimes worth the cost because of other benefits. This may not be the case always, some countries are obliged to adopt systems that are not in accordan ce to their customs, or companies create their own cultures. Some of the examples from the real world are former COMECON states adopting market based ideas and practices. Candidate states for membership to the E.U. adopting practices to facilitate entry. Western states adopting Japanese production systems, systems developed in a Japanese culture, because of its efficiency. All this implies that national cultural systems must adjust to the demands of modern capitalism. Inability to adjust will restrict or limit the extent the country or region is able to participate in international trade. New Institutional Economics (N.I.E.) helps in studying this problem. Main Characteristics of the New Institutional Economics New institutional economics is different from old institutional economics which

Values and Planning Essay Example for Free

Values and Planning Essay In this first part of my assignment I will be explaining the different values and principles that are applied in care planning and how they will enable the provision of holistic support for service users. Providing direct care/ meeting and supporting the individuals needs Meeting the individual’s needs, making sure that they recognise and promote the rights of the individual and making sure that they have a right to make choices and engaging in having their needs met are all important in social care. Independence and the wellbeing of the individual using their services should be promoted by the professional so full potential is achieved. The professional should also take part in assessments to ensure the safety and protection of their client. When identifying the individual’s needs, it helps you to create a care plan for them so that their needs are met. A professional should pay them regular visits. On these visits they may identify that the environment that they are living in is not suitable for them. All the information collected would help them to make decisions on what arrangements need to be made to meet their needs. Promotion of choice Every individual should have the right to make their own choices and what they want to do. The choices could be things such as what activities they want to take part for that day. They could do this independently or with assistance if wanted. Promotion of rights In a health and social care environment, individuals all have the rights to choice, confidentiality and to also have their individuality acknowledged and respected. Some of the rights that they have are to be able to voice their opinions and for any form of communication received to be effective. Also to be able to practice their culture and religious beliefs. Policies and procedures of the organisation that is providing them with care should be available for access to all the individuals and if they feel that their needs are not being met they can make a complaint. Recognition of preferences It is important to find out and recognise vulnerable people’s preferences when providing them with care. When their preferences are stated then the support that they want to receive will be offered to them. When vulnerable people’s preferences are acknowledged, working with them becomes more effectively. Respect for religious and beliefs, moral beliefs, values and culture In health and social care sector there is a wide range of behaviours and beliefs that should be recognised and valued. Professionals and the people receiving the care all come from different backgrounds. By law all organisations in the health and social care sector have to respect and value every individual’s religion, beliefs and culture. They need to embrace diversity and demonstrate to their workers and patients. Confidentiality Everyone has the rights to privacy and privacy over their personal details. It is important to keep all information about individuals confidential. This is a legal requirement and also shows that they value and respect their patients who are receiving care from them. The only time when information can be passed on would be if there is an occasion when it has to be passed onto another agency. When doing this the individual must be informed that this information is being passed on. Fulfilling responsibilities Policies and procedures must be followed by every individual working in the health and social care sector.by following this, they will make sure that they are safeguarding that are in their care. They also have requirements that they have to meet, to protect the people within their care. P1 In this first part of my assignment I will be explaining the different values and principles that are applied in care planning and how they will enable the provision of holistic support for service users. Providing direct care/ meeting and supporting the individuals needs Meeting the individual’s needs, making sure that they recognise and promote the rights of the individual and making sure that they have a right to make choices and engaging in having their needs met are all important in social care. Independence and the wellbeing of the individual using their services should be promoted by the professional so full potential is achieved. The professional should also take part in assessments to ensure the safety and protection of their client. When identifying the individual’s needs, it helps you to create a care plan for them so that their needs are met. A professional should pay them regular visits. On these visits they may identify that the environment that they ar e living in is not suitable for them. All the information collected would help them to make decisions on what arrangements need to be made to meet their needs. Promotion of choice Every individual should have the right to make their own choices and what they want to do. The choices could be things such as what activities they want to take part for that day. They could do this independently or with assistance if wanted. Promotion of rights In a health and social care environment, individuals all have the rights to choice, confidentiality and to also have their individuality acknowledged and respected. Some of the rights that they have are to be able to voice their opinions and for any form of communication received to be effective. Also to be able to practice their culture and religious beliefs. Policies and procedures of the organisation that is providing them with care should be available for access to all the individuals and if they feel that their needs are not being met they can make a complaint. Recognition of preferences It is important to find out and recognise vulnerable people’s preferences when providing them with care. When their preferences are stated then the support that they want to receive will be offered to them. When vulnerable people’s preferences are acknowledged, working with them becomes more effectively. Respect for religious and beliefs, moral beliefs, values and culture In health and social care sector there is a wide range of behaviours and beliefs that should be recognised and valued. Professionals and the people receiving the care all come from different backgrounds. By law all organisations in the health and social care sector have to respect and value every individual’s religion, beliefs and culture. They need to embrace diversity and demonstrate to their workers and patients. Confidentiality Everyone has the rights to privacy and privacy over their personal details. It is important to keep all information about individuals confidential. This is a legal requirement and also shows that they value and respect their patients who are receiving care from them. The only time when information can be passed on would be if there is an occasion when it has to be passed onto another agency. When doing this the individual must be informed that this information is being passed on. Fulfilling responsibilities Policies and procedures must be followed by every individual working in the health and social care sector.by following this, they will make sure that they are safeguarding that are in their care. They also have requirements that they have to meet, to protect the people within their care.