Research Topics: Financial Aspect

Main Instruments Traded In UK Money Markets

Financial market’s main purpose is to transfer funds from lenders to borrowers. It is distinguished between the capital market and the money market. Of the two divisions of the financial market, the money market deals with borrowing and lending for a period of a year or less. Money Market is so important the banks often maintain a screen showing the current prices at which they are willing to lend and borrow money (Wiseman 2001). The need for money market arises from the receipt of economic units that do not coincide with their expenditures (Cook & Laroche 1993). This means that money balances must be held in order to ensure that cash receipts can be maintained independently. However, holding balances involves costs that are in the form of foregone interest. In order to minimize the costs of the balances, only those required for day-to-day transactions are being held. Balance supplements are in the form of money market instruments that can be easily converted into cash. This money market instruments have relatively low costs and low price risks because of their short maturities. Instruments of the money market are characterized by high degree of principal safety. The maturity of money market instruments range from one day to one year. However, the most common maturity period is three months (Cook & Laroche 1993). It is also the case that active secondary markets, for most instruments, allow them to be sold even before maturity. There a number of money market instruments that can be used in order to maintain the safety and liquidity of the balances. For the purpose of discussion, this paper will be presenting four common money market instruments. The following section of this paper will be describing the four money market instruments. Repurchase Agreement             Repurchase Agreements better known as Repos are loan that are collateralized by securities. Repos are also associated with insolvency risk. It is similar to a secured loan where the lender receives securities as collateral that would protect them from defaults (Wikipedia Contributors 2006a). For example, bank A owes want to lend money to bank B. Before bank be lends bank A the money, a repurchase agreement can be completed to protect the interest of the lender. Collaterals will be set, so incase the borrowers, in any case, will not be able to pay the lender, the lender can recover their losses by selling the collateral made available through the Repurchase Agreement. The coupons that are paid out on the securities are passed on directly to the seller of the repo. Usually, the principal borrowers of this instrument are securities dealers, governments, banks and non-financial corporations. Commercial Papers             Commercial papers are shot-termed corporate debts. They usually mature after two to three months. In addition, they are issued in multiples of 100,000 by financial subsidiaries of financial companies such as general Electric Financial, Ford Credit and Chrysler Financial or by banks and finance companies. Commercial papers are not used for long-term financing. Rather, they are used to purchase inventory and to manage working capital (Wikipedia Contributors 2006c).             Two methods are being used to issue commercial papers. First, the issuer can directly issue the commercial papers to the investor who sell and hold it through money funds. Second, the issuer of the commercial papers can sell it to dealers who in turn, will sell the papers into the market. In dealing commercial papers, large security firms and subsidiaries of bank companies are the ones who are often involved. For direct issuers of commercial papers, they deem it more economical to sell them without intermediaries. It is also the case that most direct issuers of commercial papers are companies who have frequent as well as sizeable borrowing needs. Certificates of Deposit             Certificates of deposits are issued by banks. When a purchaser opens a certificate of deposit he or she will be given a passbook were the transaction relating to the certificate of deposit opened will be noted. Upon opening the certificate of deposit, the purchaser can arrange how the interest rates will be received. It can either be by cheque that will be mailed to the owner of the account or it can automatically be transferred to the chequing or savings account of the owner of the certificate of deposit. It is also the case that withdrawals made before the maturity of the account will cause the owner to be subjected to fines in relation to the policies of the banking where the account was opened and being maintained (Wikipedia Contributors 2006a). T-Bills It takes one year or less for treasury bills to mature. No interests are accumulated before the treasury bills mature. This means that they are like zero coupon bonds. Nevertheless, they are being sold at discount prices of the par value before they mature. This is done to create a positive yield to maturity. Banks as well as financial institutions are the biggest purchasers of treasury bills (Wikipedia Contributors 2006d). Credit:ivythesis.typepad.com

Main Instruments Traded In UK Money Markets

Financial market’s main purpose is to transfer funds from lenders to borrowers. It is distinguished between the capital market and the...

Non-Government Bonds In Australia

The Non-Government Bond Market In Australia Has Grown Exponentially In The Last Decade. What Factors Do You Think Contributed To This Phenomenon?   The non-government bond or corporate bond market is considered as the fastest-growing investment market in Australia. As a matter of fact, the non-government bond market already issued A billion in 1999 (AllBusiness, 1999). This shows a great increase of 28%. During that time, the non-government bond market is being affected by the strong growth of asset-backed bonds and non-asset-backed bonds which resulted to the share of asset-backed bonds in total outstanding remaining of about 40%. On the other hand, the non-asset-backed issuers comprise of financial companies, particularly banks, non-financial companies as well as non-resident entities, where in each of which is currently account for about 20% of non-government bonds outstanding (Financial Stability Review, 2004). The said number had continually increased up to the current time. In 2006, according to the report of Reuters, the total non-government bond market of Australia had been able to issue A0 billion, showing a great increase and development way back 1999. In 2007, it has been reported that the said industry issued A5 billion. There are different factors which affected the growth and development of non-government bonds in the country. One of these is the growing enthusiasm of Australian borrowers for issuing bonds offshore. According to the Ric Battelino (2002) the RBA governor of the Reserve Bank Bulletin, assistant, the primary reason behind this enthusiasm is because, offshore issues: offer access to a broader range of investors than do the domestic issues; are more likely to be in the own currency of the investor which give the investor an exposure to the Australian credit but not to the risk of currency in the country; offer a vital method of diversification in funding sources for financial intermediaries; and the market appear has the ability to handle large issues that are connected to the greater diversity of credit quality (cited in Carew, 2007). The total amount of non-government bonds outstanding had increased to A0 billion by mid of 2006 from A0 billion in 2000. Offshore issues have accounted for 67% of this increase (Market Analysis section, 2006). In addition, the growth of non-government bond is due in part to reduction of government bond issues of the country (Australian Bureau of Statistics, 2005). Thus, the fall in the supply of government bonds on issues, together with the increasing demand from funds under management, particularly the superannuation funds caused the strong growth in repurchase market as well as the non-government bond market. In 1999, the commonwealth government bonds on issues fell from A billion in 1996/1997 to A billion. In connection, the state government bond on issues fell from A billion in 1994/1995 to A billion in 1999, which accompanied by a fall in turnover in the OTC market for government debt securities from A,387 billion in 1996 – 1997 to A,054 billion of the previous 2 years (Grose, 2001). With the decreasing availability of government bonds, corporate bonds or non-government bonds were being favored as the best alternative in fixed income securities which helped to lower the cost of borrowing for corporate borrowers, at the same time, helped to increase the attractiveness of Australian denominated debt for non-resident issuers (Australian Bureau of Statistics, 2005). Another important factor that contributed to the growth of non-government bond market in the country is the increase in non-resident bond issuers or known as the Kangaroo bonds. Kangaroo bonds issued had increased from A.8 billion in 2002 – 2003 to A.2 billion in 2003 – 2004. In 2004 – 2005, the non-resident borrowers that entered the bond market with A.4 billion in issues, where in about .8 billion or 70% were taken up by residents (Australian Bureau of Statistics, 2005). Growth in the non-government bond and note market is dependent on a stable and solid flow of top-name issuers of the paper offering investors with securities providing sufficient credit-rating, liquidity and marketability. With around billion in new bonds issues in 2004, non-government market had reached its maturity. Yet, its credit profile remained strenuous, with more or less 84% of turnover in the secondary market in corporate bonds rated A+ or above. At the same time, the presence of dependable and consistent non-government bond indices had helped to strengthen and support the credibility of the market and assist superannuation and other investment funds whose fixed-income investment strategies are index-driven (Carew, 2007). Based on these, it can be said that the performance of non-government bond will continue to increase.   References AllBusiness (1999, November 30). ASX launches bond trading screen. Retrieved September 17, 2009, from: AllBusiness: http://www.allbusiness.com/banking-finance/financial-markets-investing/8173706-1.html Australian Bureau of Statistics (2005). Year book, Australia, Issue 87. Australian Bureau of Statistics. Carew, E. (2007). National market, national interest: The drive to unify Australia’s securities markets. Allen & Unwin. Financial Stability Review (2004). Credit quality in the Australian non-government bond market. Retrieved September 17, 2009, from: RBA: http://www.rba.gov.au/PublicationsAndResearch/FinancialStabilityReview/Mar2004/Pdf/fsr_0304_2.pdf Grose, C. (2001). ‘Roles of securities laws and securities market regulators for the sound development of bond markets: Australia’. In Organization for Economic Co-operation and Development (Ed.). Bond market development in Asia: Finance and investment (pp. 325 – 332).  OECD. Market Analysis section (2006, August). Australian Banks’ Global Bond Funding. Retrieved September 18, 2009, from International Department: http://203.34.60.68/PublicationsAndResearch/Bulletin/bu_aug06/Pdf/bu_0806_1.pdf   Credit:ivythesis.typepad.com

Non-Government Bonds In Australia

The Non-Government Bond Market In Australia Has Grown Exponentially In The Last Decade. What Factors Do You Think Contributed To This Phe...

Healthcare in the USA

Introduction The issue of health care in the United States has consistently been a concern for the public. This paper is going to look into the possible courses of action regarding the development of the healthcare strategies in the country. Specifically, the discussion will comprise of the arguments on the establishment of a national healthcare system and the dependence of the public on health maintenance organizations (HMOs). Dependence on Health Maintenance Organizations Health maintenance organizations (HMOs) serve as both suppliers and insurers of health care in the US. They usually offer prepaid unlimited and inclusive medical care for physical illnesses of any Kind. HMO’s vary from more conventional fee-for-service health schemes in a lot of ways. (Abraham et al., 2000) For example, HMO’s usually do not limit the days of care and spending for medical services. Similarly, HMO’s have agreed to give medical coverage at a preset cost, and therefore have an included incentive to manage costs. The consequence is that HMO’s highlight preventive health care. For instance, their members are typically granted intervallic physical exams, which are less generally covered under fee-for-service schemes. Moreover, HMOs are essentially businesses intended to make the most of profitability in every imaginable manner. There is a possibility that what someone has to do in the hospital industry what McDonald’s has carried out in the fast-food industry and what Wal-Mart has implemented in the retailing industry. (Ginsburg, 1996, p. 18) Under the concept of capitalism, health care services are analogous to fast food. This means that health care is similarly a product to be purchased and sold, akin to hamburgers and onion rings. It could be seen in the managed care sector that money exhausted on patient care is deemed as a “medical loss.” Moreover, HMOs have been the motivation following the remarkable decline in hospital stays. This brought about the now recognized “drive-through-delivery.” Patients on respirators or not capable of walking are released from the hospital when they have challenging injuries or situations that could destabilize any second (Gordon & McCall, 1999). And progressively, more friends and families acquire the load of management for patients whether they are skilled or are aware of the medical apparatus and treatments that are required to be directed. The wide scale presentation of managed care has not made health care more reachable or inexpensive. The cost of health care increases annually as does the quantity of the uninsured. Establishment of a National Healthcare System The case of the United States, regrettably, is the sole developed nation in the world that has not instituted universal health coverage. It is projected that 42.6M individuals have no health insurance (U.S. Census Bureau, 1999). The failure of health coverage and hindrances in care has brought about many individuals’ deaths. (Himmelstein & Woolhandler, 1994) The Medicaid agenda has endured noteworthy modifications ever since its setting up. In 1996, the legislative branch of the government ratified the Personal Responsibility and Work Opportunity Reconciliation Act (P.L. 104-193). The law adopted time restrictions and rigid work conditions. In New York, the amount of individuals on Medicaid reduced by 265,348 or 9% while in Texas by 306,890 or 11% (Pear, 1999). Unskilled welfare beneficiaries have a tendency to acquire low-salaried occupations with no health benefits. When managers do tender coverage, the monthly premiums are frequently not inexpensive (Pear, 1998). The welfare-to-work schemes in every state have brought about a rising number of adults and children who either don’t meet the criteria or are disconnected from health benefits the moment they come in to the workforce. There is also the recommendation of a national health care system with a single-payer involved to answer the current crisis. In this context, the single payer is the federal government. A national health care system would get rid of the health insurance companies. Each individuals would be protected by and have admission to the similar health services granted by the federal government. Only under a national health care system, with admittance assured to everyone, can health care accurately grow to be a human right. To illustrate, In 1993 Senator Daniel Inouye, launched the National Health Care Act, suggestion for a Canadian-approach single-payer scheme (Mizrahi, 1995). The thought of a national health care system, in which the government would make use of tax money to finance universal health coverage, taking away health care from the responsibility of private insurance corporations and company owners, entailed popular espousal. (Samuelson, 1993) Annually, public espousal increases for a national health care system carried out by the government similar to those in Canada and Europe. Conclusion The sole manner in which people can prevail on a benevolent health care system is by structuring a well-built, social movement that compels the government to put an end to the health insurance industry and set up a national health care system. There are no available inroads to structuring this movement. Those in power, both Democrats and Republicans, will not ratify nationalized health care except if they are obligated to by a great, well-ordered, social movement. The public is required to be a part of structuring this movement. In the mean time, the constant monitoring of HMOs should be vigilantly implemented by the government as it is in the process of instituting a nationalized health care system. The government should constantly make sure that the public is safe from any perverted measures that these companies might take in order to gain profit. Credit:ivythesis.typepad.com

Healthcare in the USA

Introduction The issue of health care in the United States has consistently been a concern for the public. This paper is going to loo...

ASTRAZENECA PHARMACEUTICAL COMPANY: CASE STUDY

Introduction               One of the international pharmaceutical companies struggling to compete in the pharmaceutical market is AstraZeneca International. Operating in over 100 countries, it can reach sales of billion, with an operating profit of .5 billion (AstraZenca, 2006). This case study explores the company, specifically how it operates under the growing but pressured pharmaceutical industry. It explores the basic structure of AstraZenca, as well as the key external drivers that impacts upon it. It also explores and discusses how the organization adds value to its products and services. The future strategic directions of the organization are also identified. Suggestions are provided, on how the organization can improve and can rise above the competition.   AstraZenca International: Profile and Organization Structure             AstraZenca International claims to be one of the world’s leading pharmaceutical companies, dedicated to the discovery, development, manufacturing and marketing of high quality, effective prescription medicines that bring benefit for patients and add value for shareholders and wider society (AstraZenca International, 2006). However, it seems that those statements were not merely blind claims as the company has evidences of its success. Their products are available in over 100 countries (AstraZenca International, 2006). In 2005, the totaled sales reached billion, with an operating profit of .5 billion (AstraZenca International, 2006).             Albeit the issue of limited research and development of pharmaceutical companies (Piachaud, 2002), AstraZenca International is one of the companies that basically invests considerably on R&D. The company spends over million every working day on the research and development of new medicines that meet patient needs (AstraZenca International, 2006). Also, it employs 12,000 people in research and development at 11 R&D centres in seven countries: Sweden, the UK, the US, Canada, France, India and Japan (AstraZenca International, 2006). Furthermore, the company has some 14,000 people at 27 manufacturing sites in 19 countries, and generally employ over 65,000 people worldwide: 58% in Europe, 28% in the Americas and 14% in the rest of the world (AstraZenca International, 2006). Although the company is headquartered in London, and has the R&D headquartered in Sweden, it currently enjoys a major presence in the United States (AstraZenca International, 2006).               Aside from its handful of employees, AstraZenca International is of course made up of Board and Senior Executive Team (AstraZenca International, 2006b). The Senior Executive Team is composed of: David Brennan (Chief Executive Officer); Bruno Angelici (Executive Vice President for Europe, Japan, Asia Pacific and ROW); John Lundberg (Executive Vice President, Discovery Research); Martin Niklasson (Executive Vice President, Global Marketing and Business Development); Barrie Thorpe (Executive Vice President, Operations); Tony Bloxham (Executive Vice President, Human Resource); Tony Zook (Executive Vice President, North America); Jonathan Symonds (Chief Financial Officer); and Barry Patterson (Executive Director Development) (AstraZenca International, 2006b).               On the other hand, the Board of the company consists of positions such as Non-Executive Chairman of the Nomination Committee, Non-Executive Deputy Chairman, Non-Executive Director, Executive Director Development, Executive Director and Senior Non-Executive Director (AstraZenca International, 2006b). The Board Committee is basically made up of four departments, which are: Audit Committee, Nomination Committee, Remuneration Committee, and Science Committee (AstraZenca International, 2006b). Several core remit of the committee include review and report to the board on: the scope of and plans for audits of the Group by the external auditor and the internal audit function; the implementation of the external and internal audit plans and the handling of any material issues arising from those audits; etc. It also brings attention to the board issues such as: any significant concerns of the external auditor about the conduct, results or overall outcome of the annual audit of the Group; any significant concerns of the Chief Internal Auditor about the conduct, results or outcome of internal audits; etc. (AstraZenca International, 2003a). The group is also responsible on: overseeing the establishment, implementation and maintenance of the Group’s Code of Conduct and other related policies and establishes procedures for the receipt and handling of complaints concerning accounting or audit matters; appointing and agreeing the compensation for the external auditor subject; and reviewing and approving the appointment and any dismissal of the Chief Internal Auditor (AstraZenca International, 2003a).               The Nomination Committee has a different responsibility. It is responsible on making proposals to the Board for any new appointments of Executive or Non-Executive Directors of the Company (AstraZeneca, 1999a).               The Remuneration Committee, then, is responsible on making recommendations to the Board of Directors on the Company’s policy for executive remuneration and to determine, on behalf of the Board, the entire individual remuneration package, including the terms and conditions of employment and the retirement/severance provisions (AstraZenca, 1999b). This Committee is also responsible on making recommendations to the Board for the Company’s Executive Share Option Scheme and Employee and Executive Performance Bonus Schemes (and any other similar schemes) and to exercise the powers of the Directors under the rules of such schemes (AstraZenca, 1999b).               Finally, the Science Committee review and assess the international competitiveness and quality of science within the Company. Specifically, it covers the strengths and limitations of the Company’s R&D science in the Research / Therapy Areas in which the Company is active or is considering becoming active; and enabling Science and Technology (AstraZenca, 2003b). It also considers the effectiveness of the Company’s delivery on specific projects in those areas, and the adequacy of the Company’s R&D skills base in those areas. It also handles significant scientific advances and their potential impact on the Company, and any other significant developments in the scientific environment which may affect its interests (AstraZeneca, 2003b).   SWOT Analysis               The strengths and weaknesses of AstraZeneca International were derived from the annual reports and articles about the company that are readily available in the Internet.   Interestingly, the company claims that its core strength is derived from its outstanding portfolio of products, its global reach and, above all, the creativity and commitment of its employees. It has ten products each with global sales of over billion i.e. products such as Nexium, Seroquel, Crestor, Arimidex and Symbicort (McKillop, 2005). The global reach of the company is also becoming strong, as it is starting to show signs of success in China, growing their business there by over 200% over the past five years. Strong growth is also being achieved in other Asian countries, in Latin America and in Eastern Europe (McKillop, 2005).   On the other hand, there are also several weaknesses that serve as barriers for the success of AstraZeneca. One of them is some failures of gambles on important pipeline medicines. Specifically, one case that tells this is the gamble of the company on Iressa – a supposed-to-be breakthrough cancer drug. The drug failed to show a survival benefit. There have been safety flags raised with Crestor, for cholesterol, and with experimental drugs Exanta, a blood thinner, and diabetes drug Galida (Forbes.com, 2004). It may create a reputation for the company as a business making unsafe or ineffective drugs (Forbes.com, 2004).   Another weakness of the company is that it is also being affected by the drug shortage crisis. For instance, AstraZeneca has discontinued its Cefotan products. Cefotan has been in short supply due to manufacturing problems and there came a point when the company had reached zero supply (American Society of Health-System Physicians, 2006).   In terms of opportunities, the company has many to be glad about. First, its recent success in countries such as China, Latin America, and Eastern Europe can open up many possibilities. Another opportunity for the company is the increasing need for innovative drugs, especially on diseases that are currently difficult to cure such as cancer and diabetes. The company has the potential to create breakthrough drugs as shown in their development of Galida and Crestor.               Finally, threats for the company are plenty, specifically the current condition of the pharmaceutical industry. One problem is the increasing cost of prescription drugs. There has been more and more demand for budgets of those who have been paying for healthcare (AstraZeneca Annual Report, 2005). Pricing pressures were placed on the industry through legislation not only in major established markets, but also in China and India (AstraZeneca Annual Report, 2005). There are also concerns on productivity and innovation, as well as on drug safety, competition, reputation, and regulation AstraZeneca Annual Report, 2005). These threats, if not carefully planned and addressed, may hamper the growth of AstraZeneca to a great extent. Many pharmaceutical companies are struggling to meet these demands just to survive.   Drivers               There are four main drivers of pharmaceutical industry. Piachaud (2002) stated: “From the standpoint of the pharmaceutical industry, the impetus for change is the result of a combination of political, economic, technological and social factors; all of which have helped redefine the dynamics of this particular industry”. Those were the same factors that affect the operations of AstraZeneca.   Political                 The company is obviously being influenced in the political perspective. In the previous years, the issue on whether or not Crestor or Galida is safe has been a political issue in the United States. There were basically different factions that are against or favor the drugs, affecting the whole marketing strategy of the company.   Economic   AstraZeneca is being affected by the economics of the pharmaceutical industry in terms of increasing prices of drugs as well as increasing demands. There has been an increasing need to demonstrate the economic as well as the therapeutic value of their medicines to those who pay for healthcare (AstraZeneca Annual Report, 2005).   Social     The social concern of the company is how well the consumers will accept and see their products. Drug safety is one issue here. Accordingly, decisions on acceptable benefit/risk profiles for medicines have the potential to be positively or negatively affected by a number of factors. These include pre- and post-marketing clinical data and regulatory judgments that reflect society’s concerns and aspirations (AstraZeneca Annual Report, 2005). The norms of people toward drugs can also be an issue, as there are some who do not take drugs seriously, resulting in the decrease of market share.   Technological               The pharmaceutical industry is characterized by stiff competition. The international competitors of AstraZeneca are international, research-based pharmaceutical and biotechnology companies that also sell branded, patent-protected, prescription medicines (AstraZeneca Annual Report, 2005). Being ahead in R&D, specifically in technologies, is a must because it will leverage a company to the top. Technologies may ease working loads; make them faster and more accurate.   Added Value                 The added value that AstraZeneca offers to its customers are: patient benefit and safety continue to be the core priority; Safety, health and environmental issues remain a fundamental Company consideration; the individuality, diverse talent and creative potential that every employee brings to the business are fully valued and respected; they maintain high ethical standards in their research and development of new medicines; they maintain high ethical standards of sales and marketing practices in all countries of operation; they make a positive contribution to the communities in which they operate; as a minimum, they meet national and international regulations; their CR or customer responsibility commitments are expanded by encouraging their suppliers to embrace standards similar to their own; and new and emerging issues relating to CR are dealt with appropriately and effectively.   Future Strategic Directions               The company has 5 main strategic priorities, which are: products; pipeline; productive use of resources; people; and reputation. In products, the company plans to maximize sales growth by: releasing the full potential of their marketed brands throughout their lifecycle; growing their position in existing markets; expanding their presence in key emerging market; and vigorously defending their legitimate intellectual property rights (AstraZeneca Annual Report, 2005). In pipelines, the plan is to deliver a portfolio of differentiated medicines that meet patient needs by: successfully delivering the next wave of products in development; further improving the productivity and efficiency of their drug discovery and development; strengthening the pipeline through appropriate external targeted acquisition, licensing and partnership opportunities; and rigorous management of their portfolio of products in development, to mitigate risks associated with new innovative products (AstraZeneca Annual Report, 2005). In terms of productive use of resources, the company plans to improve its leadership, maintain best practice, and develop new practices. People are also a concern, as the company plans to strengthen more the company culture and create more programs to motivate employees. Finally, as a remedy to one of their weaknesses – reputation- the company sought to maintain the trust and confidence of patients, customers, employees, shareholders, regulators and wider society by: understanding their needs; ensuring that they deliver on their business promises; and living up to their core values and publicly stated standards of ethical behaviour, wherever they have a presence or an impact (AstraZeneca Annual Report, 2005).               Based on the reports, the main aim of the company is to improve its management and marketing strategies. In the next years, it can be predicted that the company will become more concerned with its employees and customers, and will release programs to inform them how important they are to the company. Furthermore, the company will also become aggressive in marketing as it tries to sort out loopholes and problems in areas of distributions such as in the United States and China.   Conclusion               So far, as can be reflected from the paper, AstraZeneca International is fairly successful in meeting its endeavors as an international pharmaceutical company. Its strengths such as being able to reach more global scale, strong product portfolios, and the ability to convince customers can be attributed with the main drivers that were discussed earlier. For instance, the strong product portfolio or the popularity of the company’s products may be due to the fact that some of its products have been given enough media exposure of their controversial characteristics. Positive or negative, the company had enjoyed being recognized because of those exposures. The good thing is, some of the issues are not yet closed and in most of them, the company won the case. Being able to increase distribution into past places where sales were down can also be due to the increasing demand in prescribed drugs, and the increasing cases of cancer and diabetes around the world. The issue on high cost of drugs can also be pinpointed as factors as consumers look for better alternatives if not on price, on the cost and quality. On the contrary, the company has to work on and improve its R&D so as to avoid similar incidents such as that of Crestor and Galida. R&D should firstly conclude and proven that the products being developed are safe and will not be the object of criticism by medical experts. The company should also work on its reputation. Fortunately, they already figured this out. A good Public Relations practitioner should be hired to clear the name of the company. The company should also improve its logistics to keep in track and manage drugs that are difficult to obtain and are limited in supplies.     Credit:ivythesis.typepad.com

ASTRAZENECA PHARMACEUTICAL COMPANY: CASE STUDY

Introduction One of the international pharmaceutical companies struggling to compete in the pharmaceutical market is Astr...

Health Services in Australia

OBJECTIVES As a person with knowledge of recent strategic plans developed by health services in Australia, the author has always brought up to his superiors the viability of strategy formation regarding the analysis of this issue and at times fails to understand the reasons or logic behind certain strategic implementations imposed on it. By delving into this project paper, the author intends to have better insights into how the recent strategic plans developed by health services in Australia are thought up, formulated and then imparted down into its subsidiaries. The author hopes to have an in-depth understanding as to how the strategic plans of the health services in Australia enable them to compete effectively and profitably in this era of internationalization where competition is extremely intense. In order to reinforce the learning objectives, two key focal issues were focussed upon i.e. innovation and diversity. Innovation was discussed with regards to the strategic plans of the health services in Australia where they were renowned for their developmental capabilities to constantly innovate. Diversity came under strategic thinking and formation as the author considered the diverse culture, political climate, economic surroundings, social environment, technological settings, government policies and legal systems in order to better understand the strategic plans of the health services in Australia.   ABSTRACT   This essay utilized the health care sector as the model entity to review its privatization schemes and how they dealt with critical situations. From the analysis, key trends in their strategies were identified, how they worked and their effectiveness in dealing with critical situations was ascertained. The paper then moved on to assess the arguments favouring for health care privatization, its suitability to critical situations, during which its internal capabilities in relation to the strategy being followed was determined also. An overall analysis of the impact of health care privatization on the part of the government and the public sector was also conducted to assess and compare the benefits and disadvantages. Finally, a funding mechanism to facilitate the privatization of the health care sector was then recommended and evaluated in terms of appropriateness to the issues reviewed, feasibility in carrying out the options and acceptability within the key stakeholders and decision makers. Several key implementation issues related to managing strategic change was also addressed as well.  INTRODUCTION   Health care delivery services can be referred to as the processes that implement the policies and tasks necessary to satisfy the health care system’s customers, employees, and management effectively and efficiently. These delivery services focus on the careful management of the processes involved in the implementation and distribution of health products and services (Hansen et al. 2000). More often than not, health care services in Australia don’t really have the capabilities to directly deliver their health care to all the constituents involved. This is the reason why privatization is often mentioned as a solution to this problem. Instead, these systems engage in activities that various schools of management typically associate with health care delivery. These activities include the manufacturing of health products, health products development, production and distribution. However, an effective health care delivery system deals with all operations. Activities such as the management of health products purchases, the control of inventories, logistics and evaluations are often related with health care delivery systems. A great deal of emphasis lies on the efficiency and effectiveness of processes. Therefore, health care delivery systems include the analysis and management of internal processes. ANALYSIS Strategic Plan of Health Services Australia (HSA): Privatization The impacts on citizens and the general public from the privatization of health care and other new developments in the health care sector are being reflected in Australia. Health services in Australia, for instance, are causing the continued withdrawal of patients from the Health Services Australia (HSA) towards the utilization of private medical insurance and medical services. It became obvious that the people had already grown tired of waiting for the HSA-provided medical services. In the year 2000 alone, almost 200,000 people transferred towards private health care services to avoid the public waiting list. There is a process in Australia, just like in most countries, of a very tedious privatization process, wherein the citizens have the obligation to look out for a sector that can provide ample medical services even at a high price (Martinsen et al. 1995). More often than not, this is the consequence of unjustified increase or decrease in public spending, resulting to an even more degradation of the quality of the public services being offered to the extent where these services can no longer be given to those in need.   Technically speaking, the strategic plan of privatization of health care of HSA can be subdivided into four (4) main areas:   1. Financing mechanisms: many countries have transformed financing mechanisms into obligatory insurance funding. These can be classified as private, as these are primarily efforts made by the government rather than non-government organizations. Only a number of countries have allowed voluntary organizations to gain control of public financing.   2. Private ownership of health care facilities: the holistic privatization of pharmaceutical companies and hospitals. There are instances where certain rehabilitated facilities have been totally privatized also, but with negligible total impact.   3. Employment: there have been a number of research studies conducted regarding private sector development, and it showed that privatization of employment contracts is not a big deal. When the privatization of the health care facilities is almost total, employment contracts may be transferred towards the jurisdiction of private organizations where the citizen works (Simopoulos et al. 1997).   4. Standard utilization of private contracts: this has become prevalent especially in the secondary health care where there’s a possibility to utilize private contracts for other purposes. Evidence from Australia indicates this is a potential source of problems where there have been consistent demands to reduce wages and working conditions. Classification of the Planning Process Planning is a necessary function within strategic plans of HAS towards privatization. In most health care services this process is often very difficult because of the fast rate of change and the occurrences of unplanned events. HSA uses several methodologies depending on the rate of demand of the customer and the price of the health services. Nevertheless, the objectives of HSA for every transaction do not change: efficiency and effectiveness. Planning is being implemented by HSA in order for its activities and resources to be coordinated over time. This enables HSA to achieve its goals with minimal resource utilization. Planning also enables HSA to monitor the progress of their strategic plans at regular intervals and maintain their control over operations. Planning within HSA can be classified into four elements: scheduling, labor planning, equipment planning, and cost planning. <ul type="disc" style="margin-bottom: 0in"> <li class="MsoNormal" style="text-align: justify; line-height: 200%"> Scheduling involves the specification of the beginning, the length or the duration, and end of the planned activities. </li> <li class="MsoNormal" style="text-align: justify; line-height: 200%"> Labor planning involves allocating the necessary personnel and delegation of responsibilities and resources </li> <li class="MsoNormal" style="text-align: justify; line-height: 200%"> Equipment planning involves identifying the types and needs in terms of equipments. </li> <li class="MsoNormal" style="text-align: justify; line-height: 200%"> Cost planning involves determining the costs and the possibility of their occurrence. </li> </ul> Critical Appraisal of the Strategic Plans A. Feasibility Health care privatization offers several advantages to both the government and the private sector itself. On the part of the government, health care privatization will certainly reduce its operating costs, and this can even enable the government to raise funds to pay for the country’s foreign debts. The government can also benefit from the reduction of government expenditures as the health care privatization will enable the government to convert financial losses into tax revenues.             On the part of the private sector, health care privatization will certainly boost the growth and development of private health companies and organizations in a particular country. This is caused by the establishment of an environment that enhances healthy competition resulting to high efficiency rates and significant reduction of costs. B. Budgetary Processes First, funds can be allocated where they can possibly be most efficient. For instance, they can be directed toward health privatization technologies that have tremendous potential in the long run. These health privatization technologies will encounter a hard time competing for market share. Second, the funding mechanism enables the level of the support for health privatization to be accurately identified. This funding mechanism can guarantee a minimum level of health privatization and technology development. At the same time, the entire costs of the health privatization program are limited by the funding levels indicated. Third, the funding mechanism will be enough to establish health privatization infrastructures and will help reduce further privatization expenses.       Credit:ivythesis.typepad.com

Health Services in Australia

OBJECTIVES As a person with knowledge of recent strategic plans developed by health services in Australia , the author has always br...

Ambulance Services by Poland and UK

Introduction The good health of nations is a key to human development and economic growth and it is important to analyze health systems’ performance and to share what we knew with governments and the international community (Brundtland G.H., 2001). According to the World Health Organization, WHO, a good health system has three primary goals: (1) good health which is making the health status of the entire population as good as possible across the whole life cycle; (2) responsiveness which is responding to people’s expectation of respectful treatment and client orientation by health care providers; and (3) fairness in financing which is ensuring financial protection for everyone, with costs distributed according to one’s ability to pay (WHO, 2000). All these three make up an ideal health system.   Based on this metrics set by WHO, many countries are developing initiatives to measure performance and improve its health system. Generally measurement and improvement are linked as indicated by phrases such as ‘evidence-based medicine’ and ‘evidence-based policy’ (Zeynep, 2002). Initiatives are also being developed due to some issues raised on the policy agenda in most countries.   These issues include: raising clinical effectiveness which is ensuring that clinical decisions are based on the best current practice; improving safety or reducing medical errors which involves developing health care organizations that are capable of detecting medical errors or adverse events to patients, and which are then able to effectively act on them to avoid future occurrences; raising responsiveness of the system or providing timely services centered on patients with respect to individuals’ culture, needs and values; improving efficiency/containing costs which involves provision of the right incentives to providers, those who support funds, and consumers to get better value for money; and ensuring equity of quality of health care provided to all regardless of gender, race, and socioeconomic status, reducing health inequity (Blazevska, Vladikiene, Xinxo, 2004).   Other related issues on the health care policy of most countries are: unsafe health systems; unequal access to health care services; dissatisfaction on the part of users and the public; unacceptable levels of variations in performance, practice and outcome; overuse or under-use of technologies for health care; inefficient delivery; unaffordable waste from poor quality and unaffordable or additional costs to society (Shaw, 2002). The health system of different countries varies significantly due to many reasons. One primary reason is the wealth of a certain nation and the budget it can allocate for its health system. Another reason is how the government gives importance to the health care system. Healthcare system is also dependent on how a country allocates resources for its health care advantages. Distribution and allocation determines if individuals have the opportunity to access or use of health care services that provide for those needs. Distribution will be dependent on the policy used by decision-makers and on the methods of distribution. Healthcare authorities prioritized resources and its distribution, and further study what resources are best needed by the people in their country.          In relation to these issues, this paper discusses about the healthcare system of two countries, the UK (England), and Poland. The health policies of these countries are compared and contrast in connection to the issues on each country’s ambulance services. Included in the study are how each country determines the needs of the people, how they meet these needs, and how each country allocates its resources to be able to meet the needs.   Health Care System in Poland               Because of its being a communist country before, the current health care system of Poland has a comprehensive program of health care benefits, offering universal coverage. The Polish health care system provides services through three tiers which are the central level, the regional level, and the local level with autonomous health care administration units (Imai et al, 2000). Each tier or level works autonomously from each other making the Polish health system poorly coordinated nationally resulting to redundancy of facilities and excess capacity.   The Ministry of Health (MH) is at the central level, and is responsible for national health services including hospitals associated with medical academies, medical research institutes, and education and training of medical staff.   Hospitals and outpatient health centers comprise the regional level while at the local level, there are health administration units which provide basic health care through outpatient clinics, diagnostic and phisiotheraphy departments, and emergency services.   The legislation of the republic of Poland makes it sure that all people will be given fee access for medical services. In addition, the government ensures that over 99% of its population will be covered by the state health insurance system. Part of the medical service or assistance provided by the health care system of Poland is the delivery of ambulatory health services. The ambulatory health services of Poland are a part of the provision of national health care system in the country. Poland’s ambulance service hotline is 999. Like any other ambulance service, the country health care policy has been able to set guidelines for the ambulance service delivery system.   In Poland, the ambulance service is based in a hospital. In this manner, the ambulance service has an immediate doctor who will provide personal; assistance to the patient. In this manner, doctors are being trained to become experts in emergency response activities.   Health Policy in the United Kingdom               Health care systems across the world are set up and managed in a variety of ways. In UK health care was under the National Health Services (NHS). The NHS is a government agency set up on July 5, 1948. It is recognised as one of the best health services in the world by the World Health Organisation. NHS organisations like Strategic Health Authorities, Primary Care Trusts, Care Trusts, Mental Health Trusts and Hospital Trusts help deliver health care services to a locality.               In 1974, Community Health Councils were setup as local independent bodies to represent the interestsof the public in the National Health Service. They are statutorybodies and have rights to information, to be consulted, andto meet with Health Authorities and National Health ServiceTrusts. Public health is also integrated into the mainstream of the NHS through the national health inequalities targets. The NHS, acting in partnership with the organisations across the community, aims to improve public health and reduce inequalities.               The NHS is also composed of agencies that focus on research. These include the Public Health Research Unit, and the Public Health Genetics Unit, which keeps the public informed on the developments in molecular and clinical genetics and their implications on social and public health.      The NHS also set up Special Health Authorities like the National Institute for Clinical Excellence (NICE), which providespatients, health professionals, and the public with authoritative,robust and reliable guidance on current “best practice” on both individual health technologies including medicines,medical devices, diagnostic techniques, and procedures, andthe clinical management of specific conditions.; the NHS Litigation Authority (NHSLA) which handles claims and cover NHS bodies in respect of both clinical negligence and non-clinical risks; and the National Patient Safety Agency (NPSA).               The NHS also supports primary health care. With the establishment of the National Primary Care Research and Development Centre, which support service and policy development in the NHS by producing and disseminating high quality research, primary health care is improved. The NHS continually monitors its services to try to improve its service. The proposed  NHS Plan (2001),  which aims to secure the modern, high-quality and convenient health service required by both patients and primary care professionals, will enhance the role of primary care and put in place the policies and investment to expand and improve services and standards.               In UK there is 31 ambulance service covering England and provide single services in Northern Ireland, Wales and Scotland. This ambulatory health services provide emergency access to health care. It is a national service which is a part of the health care system of UK to give assistance to people who are in life threatening situations and serious medical emergencies. The ambulance health care services are provided from NHS trusts. The hotline for this service is 999. As part of the National Health Service Trust, these ambulatory services are obliged to respond emergency cases, high dependency and urgent inter-hospital transfers, doctor’s urgent inter-hospital transfers and other major incident.  The people of this service are also responsible for giving patient transport back and forth in hospitals for treatment.               Herein, the personnel or the telephone operator will evaluate the seriousness of the emergency and is responsible for design is most suitable for such case.  In all cases, an ambulance is being sent with enough crews, either with Emergency Medical Technician or a paramedic or sometimes both. The ambulance has been designed to give a mobile clinical workplace which has different emergency care resources. One of the responsibilities of the ambulance health care service is to react quickly or respond quickly to emergency situations. The Department of Health in UK has provided guidelines which should be followed by the ambulances regarding the time that the ambulance services should consume in giving the service.               The service being offered depends on the seriousness or severity of the situation and whether the service operates in the city, town or countryside. When someone called in the hotline, the calls are being prioritised into three categories: Category A, B and C. Category A are those calls that are most prioritised because of the life threatening situation and in this category, the ambulance service should respond within eight minutes regardless of location. On the other hand, Category B and C emergencies are serious but not immediately life threatening. In these categories the ambulance should respond within 14 minutes in urban locations and 19 minutes for rural.               Furthermore, ambulance services in UK are also responsible for undertaking complex admissions, discharges and transfers. Such ambulance service is carried out by the Patient Transport Service (PTS).  The PTS gives transport assistance for geriatric day care and disabled patients along with all other patients who need to attend a hospital for out-patient appointments or treatment. UK has a different policy compared to Poland, especially in terms of managing the operations of their ambulance services.   Conclusion   Today we know where the most urgent problems lie and what they are; where health care delivery is inadequate; what consumers want; and where fragmentation and, therefore lack of continuity of care occurs. The time is right for us to demand a system that is truly about the health of society, not only its illness. This requires hard decisions about reconfiguring our narrow illness-focused health care system to one that is inclusive of all the population, understanding the contexts in which they live and get sick, and acknowledging their differences and their priorities. It will also demand a shifting of resources, human and fiscal. It does not necessarily mean building more hospitals, but rather planning appropriate models of health care better tailored to the needs of specific groups and contexts.   The most successful health systems are those that have learned to get their strategy right. Planning, implementing and monitoring must be a never-ending process if it is to support growth and achieve satisfactory changes. Staffs who work in the health service—doctors, nurses and other health professionals—are a key resource. There must be an appropriate level of investment in education and training to help people to do their jobs effectively and due recognition of excellence. The product of research development and a sense of critical evaluation of implementation must be integrated into all activities. Continual attention must be paid to attitudes and practice as well as access to data, information and intelligence with a focus on results and outcomes.               It shows that both health care system of UK and Poland has been able to have a standard and effective policies that can be used in improving the health of the people living there. However, in terms of providing ambulatory services, the two health care systems have differences. One of which is the management style in responding to the patients who are in needs of immediate health care service. In UK, the calls are categories into three distinctions and the ambulance service are being sent with a crew, either an EMT or a paramedic, or (both), this varied on the category of the call. However, in Poland, the ambulance service is based in Hospitals and the doctor always goes with the ambulance service.               The differences of the health care system imposed by these two countries, only means that Poland and UK are two independent countries which follows different but effective health care system to ensure quality services provided with their patients.   Credit:ivythesis.typepad.com

Ambulance Services by Poland and UK

Introduction The good health of nations is a key to human development and economic growth and it is important to analyze health systems’ ...

Relate the Impact of Poverty on Women’s Health Care

In healthcare, gender differences matter. This is a deviation from the previous idea of developing a healthcare plan tailored to fit everybody. The rationale for gender consideration in healthcare is not to encourage discrimination but it is founded on the nature of women’s healthcare needs different from that of men’s. There are certain conditions that affect the women more then they do men and there are also conditions that affect women differently when compared to men. As an example, AIDS and heart attack are two medical conditions with signs and symptoms differently occurring in women. There are also conditions that only women experience such as pregnancy, childbirth and menopause. This means that healthcare programs should consider the healthcare needs of individuals as well as consider the healthcare needs of women. (Bird and Rieker, 1999)               There are several ways in which gender matters in the propensity of developing healthcare conditions. One is through gender roles and biological make-up (Bird and Riker, 1999). Although men and women both work to provide for the family, women generally carry the additional burden of pregnancy and child care. Another is through social expectations particularly family roles (Bird and Riker, 1999). Despite the equality of men and women in different spheres, many couples still practice the traditional role of men as income earners and women as homemakers. The implication of this situation to women is that women lack their own source of income.               Financial dependence of women to men for financial support in a relationship characterized by traditional gender roles means that women are poorer than their income earning partners (Doyal, 2000) so that in cases where couples separate, women are left without any immediate source of financial support together with the responsibility for the care of children. Women in a relationship are dependent upon their spouses for their healthcare needs while single mothers struggle to provide for the healthcare needs of their children often neglecting their own needs. The lack of financial support affects the ability of the woman to provide for the needs of the family such as food, clothing, shelter, education and healthcare (Doyal, 2000). In this situation, single parents carry the responsibility for earning income for the family and taking care of the children. This takes a toll on the physical and psychological well-being of women. Moreover, in most instances mothers prioritize the healthcare needs of their children or the family relative to their own healthcare.               This means that poverty or the lack of financial support for basic needs prevents women from accessing, obtaining and paying for healthcare services, medicine and nutrition. The impact of poverty to women’s healthcare is twofold. First, poverty influences women to prioritize the nutrition and healthcare needs of children and their family as dictated by gender roles, financial dependence or due to insufficient financial means. Second, poverty makes women unable to seek the appropriate and comprehensive healthcare services both as individuals and as women so that their particular healthcare needs are neglected.   Credit:ivythesis.typepad.com

Relate the Impact of Poverty on Women’s Health Care

In healthcare, gender differences matter. This is a deviation from the previous idea of developing a healthcare plan tailore...

Mckinsey and Corporation: A Case Study

OBJECTIVES As a person with knowledge of Mckinsey and Co., the author has always brought up to his superiors the viability of strategy formation regarding the analysis of this case study and at times fail to understand the reasons or logic behind certain strategic implementations imposed on it. By delving into this project paper, the author intends to have better insights into how business strategies of Mckinsey and Co. are thought up, formulated and then imparted down into its subsidiaries. The author hopes to have an in-depth understanding as to how the operations management of the company enables them to compete effectively and profitably in this era of internationalization where competition is extremely intense. In order to reinforce the learning objectives, two key focal issues were focussed upon i.e. innovation and diversity. Innovation was discussed with regard to the business strategies of Mckinsey and Co. where they were renowned for their developmental capabilities to constantly innovate. Diversity came under strategic thinking and formation as the author considered the diverse culture, political climate, economic surroundings, social environment, technological settings, government policies and legal systems in order to better analyse the case of Mckinsey and Co. EXECUTIVE BRIEF This case study utilized McKinsey and Co. as the model organization to review its present business strategies and how they dealt with critical situations. From the analysis, key trends in the business strategies of the company were then identified, how they worked and their effectiveness in dealing with critical situations was ascertained. The paper then moved on to assess these business strategies of McKinsey and Co. with regard to their suitability to critical situations, during which the internal capabilities of these business strategies in relation to the strategy being followed was determined also. An overall analysis of the performance and effectiveness of McKinsey and Co. was also conducted to assess and compare the capabilities of their business strategies with those of others. Gaps in the operations management capabilities and environment of McKinsey and Co. were then identified. Finally, several choices of strategies to improve the operations management of McKinsey and Co. as effective means in critical situations were recommended and evaluated in terms of appropriateness to the issues reviewed, feasibility in carrying out the options and acceptability within the key stakeholders and decision makers. Several key implementation issues related to managing strategic change were also addressed as well. ANALYSIS 1) What is Mckinsey’s strategy for competing successfully in its chosen market? Mckinsey and Co. aims for sustainable growth as a broad market leader in management consultancy as well as for segment leadership. In both cases, the services of Mckinsey and Co. will play a crucial part. The company is able to establish its broad leadership usually by acquiring other strong management consultancy companies and their services, which are then combined into a new, larger company. Offering training to its employees, improving the company operations, and the introduction of new technologies then reinforces the positions of the various products of Mckinsey and Co. This practically results in economies of scale that is able to create a distribution network for both the local and international consultancy services of Mckinsey and Co. If a market is already in the control of other consultancy companies, Mckinsey and Co. devotes its attention towards the development of a premium segment with its various services.             The mission of Mckinsey and Co. is to secure the growth of its business in a sustainable manner, while at the same time constantly improving the company’s profitability. The strategy to achieve this involves four elements: <li class="MsoNormal" style="text-align: justify; line-height: 200%"> Striving in order to reach a leading position in attractive markets </li> <li class="MsoNormal" style="text-align: justify; line-height: 200%"> Focusing on securing a competitive share of the market segments. </li> <li class="MsoNormal" style="text-align: justify; line-height: 200%"> Working in order to improve the company’s efficiency and cut costs in operations. </li> <li class="MsoNormal" style="text-align: justify; line-height: 200%"> Continuous growth through selective acquisitions for as long as they are able to create shareholder value. </li>   Mckinsey and Co. Generic Strategy Mckinsey and Company’s generic strategy in the management consultancy market changed for the better at the start of the new millennium and began pursuing service differentiation. True enough, the differentiated consultancy services of the company were able to satisfy the needs of customers through a sustainable competitive advantage. This allowed Mckinsey and Co. to desensitize the prices of their services and instead focused on the values that generated not only a comparatively higher price but also a better margin. POSITIONING STRATEGY AND TACTICS In order to sustain its growth on the international level, McKinsey and Co. builds its business on four (4) main positioning strategies. <ul type="disc" style="margin-bottom: 0in"> <li class="MsoNormal" style="color: black; text-align: justify; line-height: 200%"> The first is building a strong local operating platform, and then testing it over time to determine if profitable growth would be possible through the selection of the right management consultancy services and creation of the structures for distribution. </li> <li class="MsoNormal" style="color: black; text-align: justify; line-height: 200%"> The second is broadening the portfolio in order to make way for international consultancy services to give access to those not supported by the local services. Global perspectives are also gathered to help optimize both the local and global consultancy services. By broadening the portfolio, McKinsey and Co. is able to meet the consumer’s needs and minimize the costs of local infrastructures.</li> <li class="MsoNormal" style="color: black; text-align: justify; line-height: 200%"> The third positioning strategy involves a balanced portfolio of countries among established and developing markets. In this instance, the established markets will provide the funds to invest in developing markets that have lower GDPs but possess a tremendous potential for growth and development (Baumol, 2002).</li> <li class="MsoNormal" style="color: black; text-align: justify; line-height: 200%"> The last positioning strategy involves market consolidation which would help in the securing of positions and the creation of shareholder values. McKinsey and Co. strives to be in the top position on each market.</li> </ul>   2) What behaviors, skills, and attitudes will the firm need from its people to execute its strategy? It is interesting to know the basic innate behaviours, skills and attitudes that the employees of Mckinsey and Co. must possess in order to contribute towards the development of their effective management consultancy image. ·        Mental Stability Mental stability is crucial especially in the pursuit of the correct management consultancy decision as well as the management and development of the processes accompanying it. It is important for the employees of McKinsey and Co. to remain updated with the latest developments to be able to stay aware and knowledgeable in all issues. ·         Performance and Credibility The production of their best management consultancy services and outputs of McKinsey and Co. comes as a result of well-funded research management and development activities regarding management consultancy. The strong performance of their services and outputs in the market could also be linked to the effective strategic planning and human resource mobilization of the company. Thus, the company’s credibility increases as their performance becomes better (Best, 2001). ·        Planning and Strategy Formation Capabilities Planning and strategy formation nowadays has created the need for McKinsey and Co. to become aggressive especially in the area of marketing themselves. This is because the access to strong distribution channels is critical for their continued popularity. ·        Decision-making abilities. Upon arriving at the correct decision or choice, the consultants of McKinsey and Co. now gains confidence in their ability to make critical decisions or choices especially when their company’s integrity is on the line. Thus, this consultant will now search for even more challenges and opportunities where he / she could further enhance his / her decision-making abilities regarding current issues in management consultancy. ·        Holistic Mindset of Issues Through the exposure to various puzzling management consultancy issues, the consultants of McKinsey and Co. along the process are able to develop a holistic mindset regarding the issues surrounding them. The consultants now become a keen observer of the truths and lies surrounding the issue being tackled, instead of relying on mere hearsays. The continuous pursuit of the truth behind the puzzling issues enables the consultants to consistently practice and enhance a healthy and holistic mindset which makes it difficult for detractors to give influence. Because of this holistic approach, the consultants of McKinsey and Co. are able to effectively select the right choice and continue to maximize this potential for future use. 3) How has the firm been growing so far? McKinsey and Co. has been able to maintain its reputation as one of the world’s leading management consultancy companies for years now. It is able to face the challenges in many of its markets directly. This is made possible by the effective promotional and positional strategies aimed to deliver not only profit growth, but also on building down the foundation of the company’s services and business. The promotional campaigns and strategies of McKinsey and Co. are focused mainly on driving the growth of its services and improving the company’s financial performance. These campaigns have also helped secure significant acquisitions and partnerships. And more importantly, these campaigns have led to the release of the potentials of the company’s employees, thus building a quality performance- based culture (Bjorkman, 2002). The promotional strategies of Mckinsey and Co.’s services are practically reinforced by the local employees themselves. These moves certainly allow the company to improve even more without the costs of introducing new technologies. These efforts have resulted in increased financial gains for the company and have allowed the establishment of distribution networks. Because of these concerted efforts by McKinsey and Co., it has grown and expanded virtually around the entire globe. This was also made possible by their strong efforts to acquire smaller management consultancy firms from other countries. Over the years and decades, McKinsey and Co. has slowly but surely established a management consultancy empire, with strong segment markets established in the Middle East, the Western Hemisphere, the Europe and most recently the Asia Pacific. In America for instance, McKinsey and Co. was able to achieve a broad market leadership in management consultancy through various acquisition deals over the years. The company also exerts efforts to communicate with their customers in every local culture about their services and their impressions. And this is no easy thing because Americans have different tastes and lifestyles. This critical information gathered by McKinsey and Co. paves the way for them to make the right decision regarding the appropriate strategies to pursue. Heineken has even solidified its empire by adding India as one of its markets in the Asia Pacific Region just recently. And this move is a sure sign that there will be more acquisitions and mergers that McKinsey and Co. will be involved in the coming years.   4) To what extent can competitors (BBCG, Mercer, Bain& CO etc.) duplicate McKinsey’s business model? The competitors of McKinsey and Co. are slow to adapt to new technologies and services that the company releases, therefore making it difficult for their competitors to duplicate McKinsey’s business model.   How does the firm selects and motivates its professional? A. Equal Opportunity and Employment Practices   1) McKinsey and Co. does not allow employment discrimination on the basis of race, gender, religion, age, or against qualified disabled persons. 2) McKinsey and Co. does not allow the lowering of bona fide job requirements or qualifications in order to give favor to any applicant for employment. 3) McKinsey and Co. does not allow all its employees, including, managers from taking any grudge against any person making allegations of violations of the company policies.   B. Compensation and Benefits Management McKinsey and Co. determines how it will implement the Compensation and Benefits Management System which is the basis for ensuring the equitable implementation of pay decisions. The Salary Administration Plan administers the company’s internal compensation philosophy and policies, recruitment and selection process, performance management, administration of pay practices, and program evaluation plan. McKinsey and Co. regularly evaluates this plan to make sure that its employees are continuously complying to the company policies as well as to the company’s mission and organizational needs.   C. Management Development and Training McKinsey and Co. provides various employee training sessions appropriate for them to be able to help the company in achieving its mission and accomplishing its objectives. 1. The company appoints an employee that is capable in helping to implement its training and development programs and serving as coordinator for the duration of training services. 2. The company develops a biennial training plan which includes: a. a training needs assessment; b. an action plan illustrating the objectives and approaches through which the plan can possibly be done; and c. funding needed to implement the plan. CONCLUSION The results of the analysis carried out on the business strategies of McKinsey and Co. indicated very significant effects, even amidst the threats of unrest. Therefore, we could conclude that the business strategies of McKinsey and Co. could still be expected to improve faster than average. The review of the McKinsey and Co.’s operations management capabilities and resources revealed very little inconsistencies regarding their business strategies. This is coherent with their traditional inside-out approach. However, the need to reconcile both the inside-out and outside-in approaches becomes imperative now for McKinsey and Co. The analysis of the environment as well as the needed behaviors, skills and capabilities of the employees of McKinsey and Co. revealed certain gaps, most of which are biased towards the environment. However, these gaps paved the way towards determining a number of recommended strategic options to secure the competitiveness of the company. Also, the employees of McKinsey and Co. have to find a balance between adherence to internal forces within the management and to the changing forces of the environment in order to implement such strategic options.     Credit:ivythesis.typepad.com

Mckinsey and Corporation: A Case Study

OBJECTIVES As a person with knowledge of Mckinsey and Co., the author has always brought up to his superiors the viability of strategy ...