Promote Good Practice in Handing Information in Health and Social Care Settings

Promote Good Practice in Handing Information in Health and Social Care Settings Outcome 1 Understand requirements for handling information in health and social care settings 1. 1Identify legislation and codes of practice that relate to handling information in health and social care The Data Protection Act 1998 Health and Social Care Act 2001 Article 8 for The European Convention on Human Rights 1. 2Summarise the main points of legal requirements and codes of practice for handling information in health and social care The Data Protection Act 1998.The Act defines personal data as information which relates to a living individual who can be identified from the data or from the data and other information that the data controller is in possession of or is likely to become in possession of. This information may be in electronic or manual form (i. e. paper). The main principals of the act are: †¢The data must be fairly and lawfully processed and shall not be processed if certain conditi ons are not met. †¢The data must only be obtained for one or more lawful purposes. The data must be adequate, relevant and not excessive to the purpose for which the data are required. †¢The data must be accurate and where necessary, kept up to date. †¢The data must be kept no longer than necessary. †¢The data must be processed in accordance with the rights of the individual. †¢The data must be kept secure against unlawful or unauthorised processing, accidental loss or erasure. †¢The data must not be transferred to a country outside of the European Economic Area (EEA) unless that country ensures an adequate level of protection. Health and Social Care Act 2001.Section 60 of this Act gives the Secretary of State for Health the power to make regulations to authorise or require health service bodies to disclose patient information, including data which is patient-identifiable, which is needed to support essential NHS activity, in the interests of improving patient care or in the wider public interest. Proposed regulations have been drafted to authorise or require disclosure in order to monitor diseases, including communicable diseases, for occupational health purposes and for medical research. Article 8 for The European Convention on Human RightsThe European Convention was brought into UK law by the Human Rights Act 1998. Article 8 states: 1. Everyone has the right to respect for his private and family life, his home and his correspondence. 2. There shall be no interference by a public authority with the exercise of this right except such as is in accordance with the law and is necessary in a democratic society in the interests of national security, public safety or the economic well-being of the country, for the prevention of disorder or crime, for the protection of health or morals, or for the protection of the rights and freedoms of others.This means that an individual's wish to protect his or her privacy must be balanced against t he needs of the relevant public authority to obtain or use specified information. Outcome 2 Be able to implement good practice in handling information 2. 1 Describe features of manual and electronic information storage systems that help ensure security. A manual information storage system must be made of strong materials and have a lock, e. g. , a safe with a keypad code or a metal filing cabinet with a lock.An electronic information storage system should have password protection, encrypted and antimalware software. 2. 2 Demonstrate practices that ensure security when storing and accessing information. I have demonstrated this by storing manual data in a metal filing cabinet which has a key lock. When accessing data I ensure that there is not anybody around who could obtain any information, e. g. , whilst filling out paperwork at work there is a customer who will read what you are writing over your shoulder so I ensure that they are not there.If they are I go elsewhere, if they appr oach me I cover the data and put it away if I have to leave the location for any reason. 2. 3 Maintain records that are up to date, complete, accurate and legible. On each shift I complete daily support notes for each customer for that day, One to one activity support notes, medication records (MARS) and update care plans and Person Centred Plans as required. I ensure they are complete by carrying out a handover at the end of each shift.I put in all information and keep it factual so that it is accurate. I ensure I have enough time to fill out paperwork so that it is written legibly and not rushed. Outcome 3 Be able to support others to handle information 3. 1 Support others to understand the need for secure handling of information I refer staff to The Oaklea Trust Policy and Procedure regarding confidentiality. I explain the importance of keeping data locked away and not left lying around the house.When the need arises for me to pass on information of a personal nature I ensure the individual has given me permission and that I only inform people that need to know, e. g. , a disclosure of abuse must be passed on to my line manager or on call as the policy states. I inform the individual that I will have to do this and why. OR if a family member requests information I explain that it cannot be disclosed as it is confidential and advise them to speak to the customer, supervisor or line manager.When visitors are in the house I ensure that anybody holding a conversation regarding personal data i. e. a social worker and a key worker holding a meeting with a customer cannot be overheard by any staff, customers, visitors, workmen, other professionals, etc 3. 2 Support others to understand and contribute to records When a new member of staff starts I explain how the records are completed and stored and actively encourage them to fill in the paperwork. I carry out a handover at the end of each shift to ensure this has been done.I also encourage the staff member that ha s worked with each customer to complete the relevant paperwork. Regular staff meetings. Keep up to date with training. Individuals assessing care or support, it is the supervisors responsibility to organise reviews, however, when updating paperwork I regularly check the dates on care plans and reviews for the next due date and I pass it on to my supervisor when the date is near. The new care plans and reviews are placed in the relevant customer file and a note in the communication book to ensure everybody is aware and can then read it

Lean Six Sigma in Hrm

1 Lean Six Sigma in the Service Industry Alessandro Laureani University of Strathclyde United Kingdom 1. Introduction The business improvement methodology known as Lean Six Sigma is rooted in the manufacturing industry, where it developed over the past few decades, reaching widespread adoption worldwide.However, according to the World Economic Outlook Database, published in April 2011, by the International Monetary Fund (IMF, 2011), the distribution of PPP (Purchase Power Parity) GDP, in 2010, among various industry sectors in the main worldwide economies, reflected a decline in the industrial sector, with the service sector now representing three-quarters of the US economy and more than half of the European economies. PPP GDP 2010 Agriculture Industry Service European Union 5. 7% 30. 7% 63. 6% United States 1. 2% 22. 2% 76. 7% China . 6% 46. 8% 43. 6% India 16. 1% 28. 6% 55. 3% Table 1. PPP GDP Sector Comparison 2010. In light of the increasing importance of the service sector, the objective of this chapter is to discuss whether the business improvement methodology known as Lean Six Sigma is applicable to the service industry as well, and illustrate some case study applications. 2. What is Lean Six Sigma? Lean Six Sigma is a business improvement methodology that aims to maximize shareholders’ value by improving quality, speed, customer satisfaction, and costs.It achieves this by merging tools and principles from both Lean and Six Sigma. It has been widely adopted widely in manufacturing and service industries, and its success in some famous organizations (e. g. GE and Motorola) has created a copycat phenomenon, with many organizations across the world willing to replicate the success. www. intechopen. com 4 Advanced Topics in Applied Operations Management Lean and Six Sigma have followed independent paths since the 1980s, when the terms were first hard-coded and defined.  Control Key and Word – Text and Graphics.The first applications of Lean w ere recorded in the Michigan plants of Ford in 1913, and were then developed to perfection in Japan (within the Toyota Production System), while Six Sigma saw the light in the United States (within the Motorola Research Centre). Lean is a process-improvement methodology, used to deliver products and services better, faster, and at a lower cost. Womack and Jones (1996) defined it as: †¦ a way to specify value, line up value-creating actions in the best sequence, conduct those activities without interruption whenever someone requests them, and perform them more and more effectively.In short, lean thinking is lean because it provides a way to do more and more with less and less—less human effort, less human equipment, less time, and less space—while coming closer and closer to providing customers with exactly what they want. (Womack and Jones, 1996:p. ) Six Sigma is a data-driven process improvement methodology used to achieve stable and predictable process results, reducing process variation and defects. Snee (1999) defined it as: ‘a business strategy that seeks to identify and eliminate causes of errors or defects or failures in business processes by focusing on outputs that are critical to customers’.While both Lean and Six Sigma have been used for many years, they were not integrated until the late 1990s and early 2000s (George, 2002; George, 2003). Today, Lean Six Sigma is recognized as: ‘a business strategy and methodology that increases process performance resulting in enhanced customer satisfaction and improved bottom line results’ (Snee, 2010). Lean Six Sigma uses tools from both toolboxes, in order to get the best from the two methodologies, increasing speed while also increasing accuracy. The benefits of Lean SixSigma in the industrial world (both in manufacturing and services) have been highlighted extensively in the literature and include the following: 1. 2. 3. 4. 5. 6. Ensuring services/products conform to what the customer needs (‘voice of the customer’). Removing non-value adding steps (waste) in critical business processes. Reducing the cost of poor quality. Reducing the incidence of defective products/transactions. Shortening the cycle time. Delivering the correct product/service at the right time in the right place. Antony, 2005a; Antony, 2005b) Examples of real benefits in various sectors are illustrated in Table 2. One of the key aspects differentiating Lean Six Sigma from previous quality initiatives is the organization and structure of the quality implementation functions. In quality initiatives prior to Lean Six Sigma, the management of quality was relegated largely to the production floor and/or, in larger organizations, to some statisticians in the quality department.Instead, Lean Six Sigma introduces a formal organizational infrastructure for different quality implementation roles, borrowing terminology from the world of martial arts to define hierarchy an d career paths (Snee, 2004; Antony, Kumar & Madu, 2005c; Antony, Kumar & Tiwarid, 2005d; Pande, Neuman & Cavanagh, 2000; Harry & Schroeder, 1999; Adams, Gupta & Wilson, 2003). www. intechopen. com Lean Six Sigma in the Service Industry 5 Table 2. Benefits of Six Sigma in Service Organizations (Antony, Kumar & Cho, 2007). 3. Lean Six Sigma and the service industryThe service industry has its own special characteristics, which differentiate it from manufacturing and make it harder to apply Lean Six Sigma tools, which can be summarized in the following main areas (Kotler, 1997; Regan 1963; Zeithmal, Parasur and Berry 1985): Intangibility: Although services can be consumed and perceived, they cannot be measured easily and objectively, like manufacturing products. An objective measurement is a critical aspect of Six Sigma, which requires data-driven decisions to eliminate defects and reduce variation.The lack of objective metrics is usually addressed in service organizations through the use of proxy metrics (e. g. customer survey). Perishability: Services cannot be inventoried, but are instead delivered simultaneously in response to the demand for them. As a consequence, services processes contain far too much ‘work-in-process’ and work can spend more than 90% of its time waiting to be executed (George, 2003). Inseparability: Delivery and consumption of service is simultaneous.This adds complexity to service processes, unknown to manufacturing. Having customers waiting in line or on the phone involves some emotional management, not present in a manufacturing process. Variability: Each service is a unique event dependent on so many changing conditions, which cannot be reproduced exactly. As a result of this, the variability in service processes is much higher than in manufacturing processes, leading to very different customer experiences. www. intechopen. com 6 Advanced Topics in Applied Operations ManagementOwing to these inherent differences, it has b een harder for service organizations, such as financial companies, health-care providers, retail and hospitality organizations, to apply Lean Six Sigma to their own reality. However, there are also great opportunities in the service organizations (George 2003): – – Empirical data has shown the cost of services are inflated by 30–80% of waste. Service functions have little or no history of using data to make decisions. It is often difficult to retrieve data and many key decision-makers may not be as ‘numerically literate’ as some of their manufacturing counterparts.Approximately 30–50% of the cost in a service organization is caused by costs related to slow speed, or carrying out work again to satisfy customer needs. In the last few years, successful applications in service organizations have come to fruition and we will illustrate three possible applications: in a call centre, in human resources, and finally in a healthcare provider. 4. Case study 1: Lean Six Sigma in a call centre (Laureani et al, 2010a) The two major types of call centres are outbound centres and inbound centres. The most common are inbound call centre operations.Almost everyone in their daily life has had to call one of those centres for a variety of reasons. Outbound centres are used more in areas such as marketing, sales and credit collection. In these instances, it is the call centre operators who establish contact with the user. Although there are some differences between outbound and inbound call centres, they each have certain potential benefits and challenges, with regard to the implementation of Lean Six Sigma. Benefits Some of the benefits that Lean Six Sigma can deliver in a call centre are (Jacowski, 2008; Gettys, 2009): . 2. 3. 4. 5. Streamlining the operations of the call centre: Lean strategy helps in eliminating waste and other non-value added activities from the process. Decreasing the number of lost calls: Six Sigma’s root-cau se analysis and hypothesistesting techniques can assist in determining how much time to spend on different type of calls, thus providing a guide to the operators. Better use of resources (both human resources and technology), thus leading to a reduction in the cost of running such centres.Unveiling the ‘hidden factory’: establishing the root causes of why customers call in the first place can help in uncovering trouble further along the process, providing benefits that go further than the call centre itself, improving customer service and support. Reducing employee turnover: call centres are usually characterized by high employee turnover, owing to the highly stressful work environment. A more streamlined operation would assist in reducing operators’ stress, particularly in an inbound centre. ChallengesSpecific challenges of applying Lean Six Sigma in a call centre environment (Piercy & Rich, 2009): www. intechopen. com 7 Lean Six Sigma in the Service Industry 1. 2. 3. The relentless pace of the activity (often 24/7) makes it more difficult for key staff to find the time to become involved in projects and Lean Six Sigma training. The realization of an appropriate measurement system analysis (MSA) (Wheeler & Lyday, 1990) is difficult because of the inherent subjectivity and interpretation of some call types, failing reproducibility tests of different call centre operators.High employee turnover, that normally characterizes call centres, makes it more difficult for the programme to remain in the organization. Strengths Weaknesses ? ? Root cause analysis can determine major reasons for customers’ calls, helping to unveil problems further along the value stream map of the company Lean Six Sigma deployment requires significant investment in training, that may be difficult from a time perspective in a fastpaced environment such as a call centre Opportunities Threats ? ? ? ? ? Decrease number of lost calls Reduce waiting time for calls in t he queue Improve employee productivity (i. . number of calls dealt with by the hour) ? Lack of metrics Lack of support from process owner Preconceived ideas Table 3. SWOT Analysis for the Use of Lean Six Sigma in a Call Centre. Overall, the opportunities far outweigh the challenges. Call centres nowadays are more than just operations: they are the first, and sometimes a unique, point of contact that a company may have with its customers. Their efficient and effective running, and their timely resolution of customers’ queries, all go a long way to establishing the company’s brand and image. Project selection is a critical component of success.Not all projects may be suitable candidates for the application of Lean Six Sigma, and this needs to be kept in mind in assessing the operation of a call centre. Also, different tools and techniques may be more suited to a specific project, depending on the nature and characteristics of the process it is trying to address. Projects that better lend themselves to Lean Six Sigma share, inter alia, the following characteristics: ? The focus of the project is on a process that is either not in statistical control (unstable) or outside customer specifications (incapable).As already mentioned in the introduction, Six Sigma techniques focus on reducing the variation in a process, making them the ideal tools for tackling an incapable but stable process, whereas Lean tools focus more on the elimination of waste and would be the first port of call for streamlining an unstable process. Priority should be given to unstable processes, using Lean tools to eliminate the waste and simplify the process. Once it has stabilized, more advanced statistical tools from the Six Sigma toolbox, can be used to reduce variation and make the process capable. ww. intechopen. com 8 ? ? ? Advanced Topics in Applied Operations Management The root reason(s) for this has not been identified yet. It is important to start work on the project wit h an open mind and without any prejudice. Data and hard facts should guide the project along its path. Quantitative metrics of the process are available. A lack of measures and failing to realize a complete measurement system analysis (MSA) (Wheeler & Lyday, 1990) can seriously jeopardize any improvement effort. The process owner is supportive and willing to provide data and resources.This is critical for the ongoing success of the project; the process owner’s role is discussed in detail in the Control Phase section. Potential areas of focus for Six Sigma projects in call centres (Gettys, 2009): ? ? ? ? Lost call ratio out of total calls for an inbound call centre; Customer waiting/holding times for an inbound call centre; First-call resolution; Calls back inflating call volumes. Call centres are increasingly important for many businesses and are struggling consistently with the pressure of delivering a better service at a lower cost.Lean Six Sigma can improve the operation o f a call centre through an increase in first-call resolution (that reduces the failure created by failing to answer the query in the first place), a reduction in call centre operator turnover (leveraging on training and experience), and streamlining the underlying processes, eliminating unnecessary operations. Given the large scale of many call-centre operations, even a relatively small improvement in the sigma value of the process can dramatically reduce the defect rate, increase customer satisfaction and deliver financial benefits to the bottom line (Rosenberg, 2005).By focusing on eliminating waste, identifying the real value-adding activities and using the DMAIC tools for problem-solving, it is possible to achieve significant improvements in the cost and customer service provided (Swank, 2003). 5. Case study 2: Lean Six Sigma in HR administration (Laureani & Antony, 2010b) In the late 1980s, when Motorola implemented Six Sigma originally, obtaining astonishing results, the compa ny was then faced with the dilemma of how to reward its employees for these successes (Gupta, 2005).This was the first time Six Sigma and HR practices came into contact, and a more accurate definition of HR practices was needed. If, in the past, the term HR was related only to administrative functions (e. g. payroll, timekeeping, etc. ), the term has increased substantially, in the last few decades, to include the acquisition and application of skills and strategies to maximize the return on investment from an organization’s human capital (Milmore et al, 2007). HR management is the strategic approach to the management of all people that contribute to the achievement of the objectives of the business (Armstrong, 2006).As such it includes, but it is not limited to, personnel administration. In effect it includes all steps where an employee and an organization come into contact, with the potential of adding value to the organization (Ulrich, 1996). www. intechopen. com Lean Six Sigma in the Service Industry 9 As such, and merging terminology from Lean and HR, we define the following seven points as the Human Capital Value Stream Map: 1. 2. 3. 4. 5. 6. 7. Attraction Selection Orientation (or induction) Reward Development Management Separation Fig. 1. Human Capital Value Stream Map.The Human Capital Value Stream Map is a Lean technique that identifies the flow of information or material required in delivering a product or service to a customer (Womack & Jones, 1996). Human capital is the accumulated skills and experience of the human force in an organization (Becker, 1993). The Human Capital Value Stream Map is the flow of human capital required for an organization to deliver its products or service to customers; the objectives of which are briefly described below: ? ? ? ? ? ? ? Attract: to establish a proper employer’s brand that attracts the right calibre of individual.Select: to select the best possible candidate for the job. Orient: to ensure new employees are properly trained and integrated into the organization. Reward: to ensure compensation packages are appropriate and in line with the market. Develop: to distinguish talent and ensure career progression. Manage: to supervise and administer the day-to-day jobs. Separation: to track reasons for voluntary leavers and maintain a constructive relationship. It is possible to apply Lean Six Sigma tools to each step of the Human Capital Value Stream Map, in order to eliminate waste in the HR process Wyper & Harrison, 2000). For each step in the Human Capital Value Stream Map it is necessary to establish proper quantitative metrics that allow objective assessment and control of the process step (Sullivan, 2003). This makes use of the more quantitative statistical tools from the Six Sigma toolbox possible. Establishing HR metrics can be controversial, with different parts of the organization having different objectives (Jamrog & Overholt, 2005), but the answer to these simple ques tions may help to focus on the real value each step can provide. 1. 2. 3.What is the expected deliverable of the step? What are the relevant metrics and key performance indicators of the step? What are the opportunities for defects in the step? www. intechopen. com 10 Advanced Topics in Applied Operations Management For recruitment, for example, the answers to the above questions may be as follows. 1. 2. 3. Hire, in the shortest possible time, new members of staff to fulfil a certain job. The number of days to fill a vacancy (also define the acceptable norm for the organization). Any job remaining vacant for longer than the acceptable norm.Similar thought processes can be performed for other steps: having set metrics for each step of the Human Capital Value Stream Map, an organization is now in the position to apply Six Sigma DMAIC to it. Six Sigma can be used to improve administrative processes, such as HR processes. Implementing the Six Sigma DMAIC breakthrough methodology in HR f ollows the same path as implementing it in any other part of the organization. However, there are some specific key learning points and challenges for the HR area, such as: ? ? ?Difficulty in establishing an appropriate measurement system analysis and metrics; Data collection can be extremely difficult, as the project team is dealing with very sensitive issues; and Difficulty in performing any pilot or design of experiment. Any of these is going to impact on the behaviour of staff, making it difficult to measure its results accurately. As a result, projects may last longer than the standard four to six months and the wider use of tools such as brainstorming and ‘Kaizen’ workshops with domain experts may be necessary (Lee et al, 2008).Examples of potential Six Sigma projects in the HR function are: ? ? ? ? ? ? reduction of employees’ turnover reduction in time and cost to hire a new employee reduction in training costs reduction in cost of managing employeesâ€⠄¢ separation reduction in administrative defects (payroll, benefits, sick pay, etc. ) reduction in queries from the employee population to the HR department. Every area of an organization needs to perform better, faster and more cheaply, to keep the company ahead of the competition, and be able to satisfy ever-increasing customer expectations.HR is no exception: more cost-effective and streamlined HR processes will create value for the organization, instead of just being a support act for management (Gupta, 2005). 6. Case study 3: Lean Six Sigma in health-care delivery Health care is a complex business, having to balance continuously the need for medical care and attention to financial data. It offers pocket of excellence, with outstanding advances in technology and treatment, together with inefficiencies and errors (Taner et al, 2007). Everywhere in the world, the financial pressures on health care have increased steadily in the last decade.While an ageing population and technolog ical investments are often cited as culprits for these financial pressures, unnecessary operational inefficiency is another source www. intechopen. com Lean Six Sigma in the Service Industry 11 of cost increases, largely under the control of health-care professionals (de Koning et al, 2006). Lean Six Sigma projects so far in the health-care literature have focused on direct care delivery, administrative support and financial administration (Antony et al, 2006), with projects executed in the following processes (Taner et al, 2007): ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? increasing capacity in X-ray rooms reducing avoidable emergency admissions improving day case performance improving accuracy of clinical coding improving patient satisfaction in Accident and Emergency (A&E) reducing turn-around time in preparing medical reports reducing bottle necks in emergency departments reducing cycle time in various inpatient and outpatient diagnostic areas reducing number of m edical errors and hence enhancing patient safety reducing patient falls reducing errors from high-risk medication educing medication ordering and administration errors improving active management of personnel costs increasing productivity of health-care personnel increasing accuracy of laboratory results increasing accuracy of billing processes and thereby reducing the number of billing errors improving bed availability across various departments in hospitals reducing number of postoperative wound infections and related problems improving MRI exam scheduling reducing lost MRI films improving turn-around time for pharmacy orders improving nurse or pharmacy technician recruitment mproving operating theatre throughput increasing surgical capacity reducing length of stay in A&E reducing A&E diversions improving revenue cycle reducing inventory levels improving patient registration accuracy improving employee retention The focus has been on the improvement of clinical processes to identi fy and eliminate waste from the patient pathways, to enable staff to examine their own workplace, and to increase quality, safety and efficiency in processes (e. g. Fillingham, 2007; Silvester et al, 2004; Radnor and Boaden, 2008).The barriers specific to the deployment of Lean Six Sigma in health care, in addition to the ones commonly present in other industries, are: ? Measurement: it is often difficult to identify processes, which can be measured in terms of defects (Lanham and Maxson-Cooper, 2003). www. intechopen. com 12 ? Advanced Topics in Applied Operations Management Psychology of the workforce: in the health-care industry it is particularly important to not use jargonistic business language, as this has a high chance of being rejected or accepted with cynicism by medical professionalsThe application of Lean Six Sigma in health care is still in its early stages. Therefore early successes in simple projects will pave the way for tackling more complicated initiatives in the f uture, initiating a positive circle of improvement, bringing clinical change on a broad scale. Appropriately implemented, Lean Six Sigma can produce benefits in terms of better operational efficiency, cost-effectiveness and higher process quality (Taner et al, 2007), as the case studies presented in this paper illustrate.The spiralling costs of health care means that unless health-care processes become more efficient, a decreasing proportion of citizens in industrialized societies will be able to afford high-quality health care (de Koning et al, 2006). Continuous process improvement is needed to ensure health-care processes are efficient, cost-effective and of high quality. The five case study applications we have examined in this paper provide examples of how Lean Six Sigma can help to improve health-care processes.The adoption of similar programs in other hospitals across the health-care sector will help the delivery of high quality health care to an increasing population. 7. Conc lusion Lean Six Sigma is now accepted widely as a business strategy to improve business profitability and achieve service excellence, and its use in service organizations is growing quickly. However, there are a number of barriers to the implementation of Lean Six Sigma in services, such as the innate characteristics of services, as well as the manufacturing origins of Lean Six Sigma that have conditioned service managers to consider them as physical products only.On the other hand, as shown in the case studies, there are a number of advantages for the use of Lean Six Sigma in services (Eisenhower, 1999). Overall, the applications so far have showed the benefits (such as lowering operational costs, improving processes quality, increasing efficiency) to outweigh the costs associated with its implementation. 8. References Adams, C. , Gupta, P. & Wilson, C. (2003) Six Sigma deployment. Burlington, MA, Butterworth-Heinemann. Antony, J. 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Prentice Hall/Financial Times. www. intechopen. com 14 Advanced Topics in Applied Operations Management Pande, P. , Neuman, R. & Cavanagh, R. (2000) The Six Sigma way: how GE, Motorola and other top compa nies are honing their performance. New York, McGraw-Hill. Piercy, N. & Rich, N. (2009) Lean transformation in the pure service environment: the case of the call centre. International Journal of Operations & Production Management, 29 (1), 54-76. Radnor, Z. & Boaden, R. (2008) Editorial: does Lean enhance public services? Public Money and Management, 28(1), 3-6. Regan, W. J. (1963) The Service Revolution, Journal of Marketing, 47, 57-62 Rosenberg, A. (2005) Six Sigma: the myth, the mystery, the magic: can Six Sigma really make an impact in your call centre? [Online] Available from http://www. callcentremagazine. com/shared/article/showArticle. jhtml? articleId= 59301130 [Accessed 22nd January 2009]. Silvester, K. , Lendon, R. , Bevan, H. , Steyn, R. & Walley, P. (2004) Reducing waiting times in the NHS: is lack of capacity the problem? Clinician in Management, 12(3), 105-11. Snee, R. D. 2010) Lean Six Sigma: getting better all the time, International Journal of Lean Six Sigma, 1(1), 9 –29. Snee, R. D. (2004) Six Sigma: the evolution of 100 years of business improvement methodology. International Journal of Six Sigma and Competitive Advantage, 1(1), 4–20. Snee, R. D. (1999) Why should statisticians pay attention to Six Sigma? Quality Progress, 32(9), 100–103. Sullivan, J. (2003) HR metrics the world class way, Kennedy Information. Swank, C. (2003) The Lean service machine. Harvard Business Review, October, 123-129. Taner, M. T. , Sezen, B. & Antony, J. 2007) An overview of Six Sigma applications in the health-care industry. International Journal of Health Care Quality Assurance, 20(4), 329-340 Ulrich, D. (1996) Human resource champions. The next agenda for adding value and delivering results. Boston, Harvard Business School Press. Wheeler, D. J. & Lyday, R. W. (1990) Evaluating the measurement process. 2nd ed. SPC Press. Womack, J. P. & Jones, D. T. (1996) Lean thinking. New York, Simon & Schuster. Wyper, B. & Harrison, A. (2000) Deployment of Six Sigma methodology in human resource function: a case study. Total Quality Management, 11, (4/5/6), 720-727. Zeithaml, V.A. , Parasuraman, A. & Berry, L. L. (1985), Problems and strategies in services marketing, Journal of Marketing, 49 (Spring), 33-46. www. intechopen. com Advanced Topics in Applied Operations Management Edited by Mr. Yair Holtzman ISBN 978-953-51-0345-5 Hard cover, 200 pages Publisher InTech Published online 16, March, 2012 Published in print edition March, 2012 The chapters in Advanced Topics in Applied Operations Management creatively demonstrate a valuable connection among operations strategy, operations management, operations research, and various departments, systems, and practices throughout an organization.The authors show how mathematical tools and process improvements can be applied effectively in unique measures to other functions. The book provides examples that illustrate the challenges confronting firms competing in today's demanding environment b ridging the gap between theory and practice by analyzing real situations. How to reference In order to correctly reference this scholarly work, feel free to copy and paste the following: Alessandro Laureani (2012). Lean Six Sigma in the Service Industry, Advanced Topics in Applied Operations Management, Mr.Yair Holtzman (Ed. ), ISBN: 978-953-51-0345-5, InTech, Available from: http://www. intechopen. com/books/advanced-topics-in-applied-operations-managem ent/lean-six-sigma-in-theservice-industry InTech Europe University Campus STeP Ri Slavka Krautzeka 83/A 51000 Rijeka, Croatia Phone: +385 (51) 770 447 Fax: +385 (51) 686 166 www. intechopen. com InTech China Unit 405, Office Block, Hotel Equatorial Shanghai No. 65, Yan An Road (West), Shanghai, 200040, China Phone: +86-21-62489820 Fax: +86-21-62489821

The German Blitz

Where and when did the Blitz start? At 4:56pm on 7 September 1940, the air raid sirens wailed as the luftwaffe (the German Air Force), launched a massive attack on London. Around 350 bombers flew across the English Channel from France and dropped 300 tonnes of bombs on the docks and streets of London. Other places that were affected? Other important military and industrial centres, such as Aberdeen, Belfast, Birmingham, Cardiff, Exeter, Glasgow, Sheffield, Swansea, Liverpool, Manchester, Portsmouth, Plymouth, Nottingham, Brighton, Eastbourne, Sunderland, and Southhampton, suffered heavy air raids and high numbers of casualties. Bootle and Hull were the most badly damaged cities city after London. Birmingham and Coventry were targeted because of the Spitfire and tank factories based in Birmingham and the many munitions factories in Coventry. Who did it affect and where did they go? Around 827,000 Schoolchildren and their teachers were evacuated, 524,000 Mothers with children under five and some pregnant women and disabled people. They were evacuated by trains and via the road to smaller towns in the countryside. Some children went to stay with relatives but most were sent to live with complete strangers. Where did people go during the air raids? As the night raids became so frequent, many people who were tired of repeatedly interrupting their sleep to go back and forth to the shelters, virtually took up residence in a shelter. There was different types of air raid shelters, there was the anderson shelter which were small corrugated iron shelters half buried in the ground with earth heaped on top to protect them from bomb blasts. Another type of shelter was the morrison shelter, it was made specifically for people without gardens, it was made from heavy steel and could also be used as a table, people sheltered underneath it during a raid. On September 21, 1940 the London Underground started to be used as an air raid shelter. On the busiest night in 1940, 177,000 people slept on platforms. In other parts of Britain caves where used to shelter in. When did the blitz stop? The Blitz ended in mid-may 1941 due to German Planes being sent to the east of Europe to prepare for the invasion of Russia.

European law Essay Example | Topics and Well Written Essays - 2500 words

European law - Essay Example ibutor Lyon in France is 40% of the market and therefore there could be an issue of collective dominance1 of BMC and Lyon that may well arise in this case and invoke the provisions of Article 81(1) restricting competition in the internal market. Article 14(2) of the EC Treaty defines the internal market as â€Å"an area without frontiers in which the free movement of goods, persons, services and capital is ensured in accordance with the provisions of this treaty.† On this basis, it may therefore be stated that any measure that has the cumulative effective of restricting the free movement of goods (in this case cars) within the internal market which is comprised of the European states including UK, France and Germany could be deemed to be violative of EU law. However EC competition law is based upon the Treaty of Rome which requires that certain objectives be taken into consideration in so far as implementing Community law is concerned, such as for example Article 6 for environmental protection, article 127 for employment or article 153.2 for consumer protection. Such factors therefore allow for a fairly flexible interpretation of competition law, as in the case of Metro SB-Großmà ¤rkte GmbH & Co. KG v Commission. 2 Monti has also pointed out several other examples of goals that have been considered in implementing competition law, either directly or indirectly and identifies some of these goals as regional development, industrial policy, protection of employment, protection of the environment and market integration.3 Such exemptions may however, not always apply. For example, in the case of A BrunsteinergmbH and Autohaus Hilgert gmbH v BMW,4 the Court held that where the exemptions listed under Article 81(3) of the EC Treaty were not satisfied, then contractual terms between two undertakings that were restrictive of competition could be deemed to be liable under the provisions of Article 81(1). A major issue in this case was the application of Regulation EC No:

Organizations Mission, Vision, and Core Values Research Paper

Organizations Mission, Vision, and Core Values - Research Paper Example According to Martires & Fule (2000), the concept of organizational culture encompass the atmosphere that the personnel is accustomed to practice as a result of adherence to the policies, rules, mission and vision statement, as well as the existing protocols that are being applied in the conduct of offering the products or services to their clientele. From continued patronage and established bond with the organization due to being one of its identified stakeholders as a loyal customer, one has observed that the culture of the organization is known from observation that they abide by the requisite to doing the right thing (McDonald's: Getting to Know Us, 2012). There is also the conformity to the identified McDonald’s System, which, upon further research indicated that commitment to high quality, innovation, and techniques that achieve sustainability embody the organization’s culture (McDonald's: McDonald’s System, 2012). It has been observed that encompassing the organization’s culture is the fast way of ensuring that their food products are served wtihin a stipulated time frame and meeting the highest standards of sourcing raw materials from their best suppliers. Each aspect of the organization’s operations are evaluated to conform to concepts of social responsibility, conformity to environmental protection and conservation, addressing nutritional components of the ingredients that they use in their products, and in educating their varied personnel to emphasize that other aspects deemed crucial in the organization’s thrust to achieve their goals include the participation and collaborative contribution of a diverse pool of human resources (McDonald's: Inclusion & Diversity, 2012). However, when one visited McDonald’s restaurants, it could be observed that there is inconsistencies in applying customer service protocols, in conformity to the highest standards of ingredients or raw materials used for their food products, and in their supposed commitment for social responsibility. Section 3: Recommendations In linking the organization’s mission and value statements to the perceived organizational culture, it could be deduced that all crucial components to ensure leadership and success have already been set in place. However, as organizations continue to evolve, like McDonald’s, the organization acknowledges the need for continued growth through thinking outside the box and by soliciting customers’ feedback and responses with the aim for further improvement and development in customer service, in conformity to social responsibility and environmental protection, and in consistency of practicing or applying the theories learned in operating and managing a global organization. In this regard, the four recommendations proposed regarding the application of theories to actual experiences, as manifested and exemplified through their various personnel’

Data and Information System Models Assignment Example | Topics and Well Written Essays - 750 words

Data and Information System Models - Assignment Example Quinn draws attention to several requirements that must be put into consideration in the design phase of a healthcare system for a successful clinical transformation. Among the highlighted requirements presented by Quinn are; accessibility, reliability, security, flexibility, presentation-interface integration, portability and response time. All the presented factors are fundamental and should be looked into when designing healthcare system, however, much focus should be placed on four major factors namely security, accessibility, response to time and reliability (Quinn, 203). Healthcare system is to provide and aid in the management of information with the purpose of implementing clinical transformation. The data and information of patients as well as the doctors and the clinical employees are sensitive and therefore much focus should be place on security of the information entrusted to the system. The system should be designed in a manner that the information stored in it is easily accessible while maintaining integrity of the same information by restricting the access to only thee authorized party. Also, reliability is another factor that should not be overlooked in the design phase given that it is paramount for the success of the system. The designed system should be reliable. Speed is another key factor given that the system should be able to respond fast to the requests by various users since time is a paramount factor in a clinical setting (Quinn, 205). All these factors are critical in strong and appropriate management of information which is in turn imperative in the successful implementation of clinical transformation. At the top of this list is security. The sensitivity of information flowing through clinical and healthcare setting and the need for privacy makes security an imperative factor to consider when designing a healthcare system meant for clinical transformation. Quinn states that it is essential to balance between security and access to in formation in order to successfully secure the system as well as ensuring accessibility to information. Security is ensured within an organization by employing various mechanisms in order to maintain privacy policies. Security plan is composed of both technology components and policy. In order to ensure security and maintain privacy of the information within the system, it is imperative to adopt all-inclusive procedures, policies in addition to educational processes. The technology components of security that should be adopted include access control such as encryption, password/ username, antimalware programs, backup and recovery plans besides physical locks on doors to implement restriction. A secure system ensures that the information stored in the system is reliable, trustworthy and has integrity. Quinn highlights accessibility as another paramount factor to be considered in the successful design of healthcare system for clinical transformation. As much as security is implemented, the same information should be easily available and accessible to the right party at the required time. The users should be able to easily access applications and data within the system in a manner that it does not flout on the security policies of the system. Maintaining the balance between accessibility and security is complicated given that the two factors works against each other in a way. Accessibility works towards

The Conceptualization of Diversity Management Article

The Conceptualization of Diversity Management - Article Example Though the objective of diversity management is also the utilization of all available talents it is said that there is a shift in the orientation of this policy from the concept of equal opportunities. Nevertheless, the concept diversity management as an emerging aspect of Human Resources Management (HRM) is occupying a central place in the recent periods. In this context this paper presents an overview of the conceptualization of diversity management, the issues connected therewith and presents an evaluation of some of the ways in which the present day organizations can improve upon their policies on managing diversity to make it more effective. "Managing diversity effectively follows on from, and expands on equal opportunities"(NCVO) Equal opportunities is about keeping within the law and the decisions about the payment of wages, recruitment, and promotional policies are to be framed on the basis of the capabilities of the individuals to perform their functions effectively. This requires a systematic policy approach to all facets of personnel management and such policies are framed by a pre-empting discrimination. "Diversity is a more wide-reaching approach to equal opportunities work. It incorporates the principle that all workers should receive equal rights but, rather than ignoring the differences between people in terms of their gender and race, this diversity should be recognized and respected." (NCVO) Diversity management works on the basis of a valuation of the varying aptitudes and skills that different workers bring along with them to be utilized by the organizations. Under this concept, the managers arrive at a working environment where all the workers are valued on the basis of their individual skills and expertise and also such skills and expertise are utilized to the fullest extent.The idea of 'diversity management' is not a new one and has been found in existence even from the late 1980s. All the three concepts of Diversity Management, Human Resources Management, and Total Quality Management are having the central idea of improving the business efficiency and make it result to p roduce the more economic gain in the form of enhanced profits. But the concept of diversity management has been found to be deviating in orientation from that of equal opportunities, as observed by Thompson (1997) "The concept of 'managing diversity' is one that has grown out of Human Resources management and is also a movement away from traditional equal opportunities policies and practices. It is premised on the recognition of diversity and differences as positive attributes of an organization, rather than as problems to be solved." However, the phenomenon of diversity management finds itself conceptually similar to that of HRM as evidenced by the work of Storey (1995) "A distinctive approach to employment management which seeks to achieve competitive advantage through the strategic deployment of a highly committed and capable workforce.

Crocargo Logistics Essay Example | Topics and Well Written Essays - 2250 words

Crocargo Logistics - Essay Example The business has been unable to generate enough capital to increase the ultimate profitability of the firm. The fundamental problem highlighted in this case is that of an inadequate costing system and an internal environment characterized by friction. The company is operating in a very hostile and competitive marketplace. The costing system that is needed to support the operations of the company is totally inadequate to keep the company operational for a very long time. The current costing system has been developed by the company’s operations manager who is more than satisfied with her costing system. She is not willing to take anyone’s opinion regarding the problems inherent in her system, as a result of which the company is not accounting for the costs it is actually incurring. The general manger of the company has finally realized this problem and has called for an external help who would suggest a more competitive costing method. Introduction An activity-based costi ng technique is one of those techniques which enable a company to identify its costs objects more accurately. This aspect of this technique has profound implications on a business, for instance it allows a company to identify unnecessary costs, price its products or services more efficiently and last but not the least it allows a company to be more competitive in its industry. ... So it goes like more the environment is competitive, more the costing system needs to be sophisticated. The costing system should effectively match costs with different cost objects. All these objects are integral to the ABC costing system (Brimson, 1991). Since the level of competition is high in the service competition, therefore a service firm needs to accurately estimate its costs. This new change in the industry has made costing a strategic issue; it has become so important that it effects long-term strategic decisions as well as day-to-day operating decisions. Costing has become so important because it helps a firm in: product or service organization, staffing and resource allocation. Accurate costing allows a company to plan resource consumption, price services properly and implement different strategies. But it is very difficult to initiate an Activity Based costing in a service firm, because in a service firm an employee is engaged in multiple activities involving different time-period. This makes it difficult to trace the resources consumed by a cost object (Cagwin and Bouwman, 2002). Even though the service industry is interested in implementing an activity based costing system, but since these models are made using the activity based costing models of a manufacturing firm as frame of reference, therefore the industry is facing multiple problems with regards to this technique’s implementation. The fundamental problem for this service industry is the absence of inventory, which receives an utmost importance while undergoing a valuation process. Other important cost variables are direct material and labor which are also absent in a service industry. This leads to a problem of estimating

Macro economics Essay Example | Topics and Well Written Essays - 750 words

Macro economics - Essay Example 9.7 %. The declined level of disposable income would result in slowing down of the consumption rate as well. Higher disposable incomes are prerequisite to boost the economy of a country. This is because higher level of disposable income facilitates to augment consumption and greater rate of consumption in turn leads to enhanced spending which is necessary for economic development (Orlik and Davis, â€Å"China Falters in Effort to Boost Consumption†). RETAIL SALES Chinese retail sales have been lowered to 12.7% in the first half of 2013 against the impressive rate of 14.4 % on YoY (Year-on-Year basis) in 2012 (Orlik and Davis, â€Å"China Falters in Effort to Boost Consumption†). ECONOMIC GROWTH Chinese economic growth also decelerated to 7.5% in the second quarter of 2013 against the previous year’s rate. Apart from the Chinese economic growth rate, this article revealed the growth rate related to the United States. The QoQ (Quarter on Quarter) annualized basis g rowth rate related to the United States came out as 6.9% in 2013 which is slightly up from the previous year’s (2012’s) growth rate i.e. 6.6%. However, this rate was far below than the government target growth rate i.e. 7.5% (Orlik and Davis, â€Å"China Falters in Effort to Boost Consumption†). INFRASTRUCTURE The article has revealed that the new residential properties under construction in China have grown to 2.9 % YoY basis in the first half of the year 2013. It also revealed the fact that the real estate prices in China especially in the cities such as Beijing as well as Shenzhen have grown by double-digit (Orlik and Davis, â€Å"China Falters in Effort to Boost Consumption†). 2. GOVERNMENT ROLE IN THE ECONOMY Government plays a vital role towards the economic development of a country. Government roles involve developing various economic policies for the country, defending the nation’s borders, operating courts and legal systems. Government pla ys an important role to regulate tax system of the country along with investing capital for developing various infrastructures within the country. Government has three major roles in the economy. Firstly, it establishes and upholds various property rights. Secondly, it offers nonmarket mechanism for allotting limited resources and thirdly it implements provisions that redistribute wealth and income (Parkin 371-372). In case of Chinese economy as well, the government has strived to take certain measures in terms of preparing economic restructuring plan through laying its focus on investment related to ensuring energy efficiency along with information technology. It has also encouraged different institutions to provide lending to the country’s smaller sized organizations (Orlik and Davis, â€Å"China Falters in Effort to Boost Consumption†). 3. IMPRESSIONS DERIVED FROM THE ARTICLE The article i.e. â€Å"China Falters in Effort to Boost Consumption† published in Th e Wall Street Journal provides an explanation to the latest economic developments in China. It has revealed vital facts relating to the growth rate of China with regard to various fields especially unban household. Beijing’s plan to cut focus on undependable exports also creates a hindrance to growth as urban households level of disposable incomes reduces. Initial part of the article discloses various in

Globalization Essay Example | Topics and Well Written Essays - 500 words - 14

Globalization - Essay Example s affected by it; in fact, it can be said that it undermines state sovereignty because decisions that are made have to consider their impact on international affairs (Shimko 192). An example of this is oil-exporting countries that heavily depend on the income from this product to fund their national budgets. If these countries were to act in a way which displeases the international community, then they would be forced to abandon such decisions through the placing of sanctions on their exports. Moreover, because of globalization, many countries have interests in other countries; therefore, to protect these interests, it has become necessary for the powerful to meddle in the political affairs of the weaker ones (Yang170). This has not only made the latter countries lose their sovereignty, but it has also encouraged their overdependence on more developed nations for economic aid. Cultural diversity loosely refers to the variety and differences in race, ethnicity, and class that are present in a society, state, or the world. Different races have diverse cultures or customs; for  example, in a  traditional  Mexican  wedding; there is a  distinct  ceremony  where  a rosary  or  white  rope  is wound around  the  bride  and  groom  to form a number eight.  Languages, cuisine and mode of dressing are also part of cultural diversity notwithstanding the conformity to everyday way of living by people of a certain society (Mueller 71). History profoundly determines these aspects, but they are mostly affected by the environment. This implies the people who develop the cultural resources and control access to the culture itself. While trying to achieve globalization, cultural diversity has developed since the core idea behind it is ‘speaking a common language’. This is because globalization includes transformation of a s patial organization, which in turn means wide-ranging institutional reform institutions formed with a large influence from culture. Many argue that

Empiricism Essay Example | Topics and Well Written Essays - 2500 words

Empiricism - Essay Example We should reject knowledge claims concerning matters of fact about the nature of the world which are not supportable by the evidence of experience. This leads to a tendency among empiricists to emphasize that the limit of human knowledge and imagination is bounded by the limit of our experience. Empiricists reject the rationalist claim that it is possible to come to know by a priori reason alone the nature of an intelligible real world inaccessible to experience that stands beyond appearances. The empiricist may argue that concepts (such as substance), and the terms that express them, are meaningless or else must relate to some possible experience, since concepts and terms get their meaning by reference to some possible experience, but a world beyond experience cannot be a world that might possibly be experienced; in either case it is not possible to use meaningful concepts to talk of a world beyond possible experiences. The tendency in empiricism is also to deny the existence of natural necessity: necessity is a property only of logical relations between concepts, or of logical relations between ideas or thoughts, not between things or events in the world whose existence, nature and connections are all contingent; such natural contingent connections can be discovered not by reason, which can establish only necessary truths and necessary connections, but only by experience. Empiricism is inclined to argue that there are two exclusive and together exhaustive types of proposition. (a) Propositions whose truth, logically speaking, can be known merely by understanding them, or by deductive reasoning alone, independently of the evidence of experience: truths of reason. (b) Propositions whose truth, logically speaking, cannot be known merely by understanding them, or by deductive reasoning alone, but which depend on the evidence of experience: truths of fact. All propositions which tell us anything about the real or actual world are truths of fact. Propositions stating matters of fact cannot be known to be true merely by our understanding them, or by our deducing them from other propositions known to be true by the understanding alone; if we can know them to be true at all, they must be known through consulting experience. It should be noted that the distinction is not the genetic one of how we come to have, acquire, or understand these different sorts of proposition, but a logical question concerning on what, once acquired or understood, the truth or falsity of a proposition depends, and on what knowledge of the truth or falsity of a proposition depends. If the truth or falsity of a proposition depends only on the meaning of the terms in it, then it is an a priori proposition whose truth or falsity can be known a priori by reason alone independently of empirical evidence. If the truth or falsity of a proposition does not depend only on t he meaning of the terms in it, then it is an a posteriori proposition whose truth or falsity can only be known a posteriori by empirical evidence, not by reason alone. (Frederick Copleston, 1964, 54) The basic contrast between rationalism and empiricism is an argument about the extent and nature of what truths it is logically possible to know a priori by the understanding independently of experience, by intellectual intuition

Data communications and neetworks Essay Example for Free

Data communications and neetworks Essay What is signalling? Signalling is a term used for the use of data being transmitted or carried across a medium for example in a network this could be a cat 5 cable. There has to be a way also for the receiver to interpret the data being sent and this is controlled by whats called encoding however the word modulation also means the same thing. The signal that is sent it modified in a way for it to signify data. There are different types of transmission methods which differ from what type of medium you are using for example cables or wireless there are four which are listed below: 1. Electrical uses your cables to transport data between nodes 2. Radio Waves this would be your wireless networks and could also include Bluetooth devices. 3. Light this would use fibre optic cabling to send high speeds of data 4. Microwave Analogue Digital Signalling There are two different types of signalling and these can be done in Analogue which means it changes all time in both amplitude and frequency. For example an analogue clock which has its hands moving all the time is changing the time all the time. Whereas with digital signalling which are representations of discrete time signals. For example a digital clock shows the minutes and not the seconds. When the information is being sent over a network when communicating, the information can travel in two forms, these are analogue and digital. The difference between the two is simple that analogue signalling never stops, and the information is being sent continuously, a good example of this signalling is clocks. An analogue clock will never stop, as the second hand is always ticking, therefore one can record an accurate reading of the time to the second, or even millisecond. For example, 1 hour 15 minutes and 24 seconds. Appose this to digital signalling where one can not get an accurate reading of a clock as it will only show the minutes. And therefore is not continuous. This is because the data is consisting of separate states, which are on or off. Sine Wave This type of wave has two properties a Amplitude Frequency, the amplitude represents the strength of the signal which would be the volume of a sound for example somebody talking. If the amplitude is stronger than it will travel further. The frequency of a Sine Wave is the rise and fall of the wave from the zero to the top and then back to the zero this is known as a cycle and is measured in Hz. The higher frequency the more cycles and therefore the lower the frequency the lower the cycles. Analogue The image below shows the analogue type of signalling its constantly changing and represents all the values in the wave range, there is always a value in between a value and another. http://moodle. derby-college. ac. uk/mod/resource/view. php? id=2346 Digital With digital signalling there are no in betweens like there in analogue its simply either 1 or 0, digital represents separate states and the change between these are practically unnoticeable. http://moodle. derby-college. ac. uk/mod/resource/view. php? id=2346 Asynchronous Transmission Asynchronous transmission is when signals are not sent at regular intervals. A good example of this would be a user using a keyboard attached to a computer. The characters are sent irregularly however the bits must be sent at known intervals. This is done by having accurate clocks at both ends of the link. The receiving clock starts when it receives the first bit from the transmitter, this is also known as the start bit. The receiver then expects to receive a known number of bits every tick of the clock. When it has received these bits the clock may stop; the last bit is known as the stop bit. Synchronous Transmission However when large volumes of data are to be transferred, the waste of the stop and stop bits with every character means that asynchronous transmission is not an efficient method. With high-speed devices, and buffered low-speed devices, data can be transmitted in large, timed, synchronous blocks. The clocks, in the receiver and transmitter, are kept synchronised by sending regular groups of special characters called SYN characters. Each time one of these groups is detected the receiver re-sets its clock, the data apart from this, its transmitted in exactly the same way as for asynchronous transmission. We can visualise the data as follows: Bit Synchronisation In a digital signal, as well as on occasion, an analogue one, all the different devices must know how often the signal varies along the transmission medium. For example, if the speed of the changes goes faster then the rate at which the device checks for changes, there will be a few of the bits missed between samples. If then sampling rate goes faster then the rate at which the transmission goes, the same bit will be used for a different sample a second time. To combat this fact, the devices are made to a universal standard so that they can work together in harmony, and there are set systems in place to allow the data to be transferred correctly. A lot of the current technologies use asynchronous serial transmission. This transmission method is used when data is not sent at regular intervals, but the bits themselves have to be sent with regularity, some examples of these are keyboard, mice or even modems. During the spans of time that no signal is sent, the line or other medium is in what is called an idle state. This is defined by the constant 1 signal being sent. One there is a packet of data that needs to be sent, for example, a key on the keyboard is pressed, the receiver first gets a start bit, a 0 state instead of a 1 to define the beginning of a piece of data now being sent to the receiver, it is then sampled and at the end of the data transmission, the signal returns to the original constant 1 state. Encoding Methods Encoding simply means that the information is converted from one format to another format. This is a process that the data needs to have done to it before the computer can understand it and process it. There are different types of encoding which are   Manchester Encoding is a data communications line code which provides a way of encoding binary data sequences. Each bit is related to by at least one voltage level transition. Manchester encoding is said to be self clocking this means that synchronisation of a data stream is possible. Huffman Encoding is another algorithm used for data compression; the coding uses a specific method for choosing the representation for each symbol. Unipolar Encoding This type of encoding has 2 voltage states, one of these states is zero and because of this its also know as Return to Zero (RTZ) Unipolar encoding is used in computers logic and an example of where its used in computers is the TTL logic. Polar Encoding Polar encoding is when the digital encoding is on a level with zero volts for example the RS232 standard interface uses Polar encoding and unlike Unipolar the value doesnt return to zero, its either a positive or negative voltage. With polar encoding it reduces most of the residual DC problem.

Procter Gamble Company Merger Case Study

Procter Gamble Company Merger Case Study The project deals with the analysis of mergers and acquisitions in an FMCG sector. Products which have a quick turnover, and relatively low cost are known as Fast Moving Consumer Goods (FMCG). FMCG products are those that get replaced within a year. A merger is the combining of two or more companies, generally by offering the stockholders of one company securities in the acquiring company in exchange for the surrender of their stock. This project deals with the merger of Procter Gamble and Gillette, acquisition of Balsaras hygiene and home product by Dabur and Acquisition of Nihar brand from HLL by Marico. The methodology deals with the various ways in which the data for this project was collected. Due to the limited scope of information and time constraints, secondary and not primary data sources has been used including journals, articles, reference sites, etc. The project guide proved very vital in the successful completion of my report. The next section deals with the individual introduction of both companies involved in the process of merger. It further includes the different terms of the merger and various synergies created through the merger. Furthermore the next section deals with scenario after the merger and analysis of financial statements of acquiring company post merger. Building a brand from scratch in the FMCG space can be quite an expensive exercise. Mature categories such as personal care or household products are already dominated by one or two strong incumbents and wresting market share away from them is quite a challenge. With growth rates in markets such as skin care, hair care and household products suddenly moving into high gear, companies also cannot afford to lose time on the trial-and-error method that usually accompanies new launches. Given this scenario, domestic players seem to view brand acquisitions and mergers as the quickest way to step into new categories and acquire a well-rounded product basket, without squandering their surpluses on brand-building expenses. Market shares apart, many of the buyouts have been motivated by the need to acquire better distribution reach whether within India or overseas. Introduction I. MERGER A merger is the combining of two or more companies, generally by offering the stockholders of one company securities in the acquiring company in exchange for the surrender of their stock. A merger occurs when two or more companies combines and the resulting firm maintains the identity of one of the firms. One or more companies may merge with an existing company or they may merge to form a new company. Usually the assets and liabilities of the smaller firms are merged into those of larger firms. Merger may take two forms- Merger through absorption Merger through consolidation. Absorption: Absorption is a combination of two or more companies into an existing company. All companies except one lose their identity in a merger through absorption. Consolidation: A consolidation is a combination if two or more combines into a new company. In this form of merger all companies are legally dissolved and a new entity is created. In consolidation the acquired company transfers its assets, liabilities and share of the acquiring company for cash or exchange of assets. II. ACQUISITION A fundamental characteristic of merger is that the acquiring company takes over the ownership of other companies and combines their operations with its own operations. An acquisition may be defined as an act of acquiring effective control by one company over the assets or management of another company without any combination of companies. III. TAKEOVER A takeover may also be defined as obtaining control over management of a company by another company.Merger of Procter Gamble Company and Gillette CompanyAbout the merging companies: Procter Gamble Procter Gamble Company is asoap opera. PG was named 2008 Advertiser of the Year by Cannes International Advertising Festival. Effective July 1, 2007, the companys operations are categorized into three Global Business Units with each Global Business Unit divided into Business Segments according to the companys March 2009 earnings release. Beauty Care Beauty segment Grooming segment Household Care Baby Care and Family Care segment Fabric Care and Home Care segment Health and Well-Being Health Care segment Snacks, Coffee, and Pet Care segment PG has gone into an aggressive mode. It has launched two new variants on 2nd Dec 2009, one in the detergent segment, which is called Tide Naturals and also another one in skin care segment under the Olay brand. Gillette Company The Gillette Company is a globally focused consumer products marketer that seeks competitive advantage in quality, value-added personal care and personal use products. It is the world leader in the mens grooming product category as well as in certain womens grooming products. Although more than half of company profits are still derived from shaving equipmentthe area in which the company startedGillette has also attained the top spots worldwide in writing instruments (Paper Mate, Parker, and Waterman brands) and correction products (Liquid Paper), toothbrushes and other oral care products (Oral-B), and alkaline batteries (Duracell products, which generate almost one-fourth of company profits). Gillette maintains 64 manufacturing facilities in 27 countries, and its products are sold in more than 200 countries and territories, with more than 60 percent of sales occurring outside the United States. The Merger: On October 1, 2005, Procter Gamble finalized its purchase of The Gillette Company. As a result of this merger, the Gillette Company no longer exists. Its last day of market trading symbol G on theOral-B, among others, which have also been maintained by PG. The Terms of the Merger: Date of merger: The merger came into effect from July 1st, 2007. The new company formed : The Gillette Companys assets were initially incorporated into a PG unit known internally as Global Gillette. In July 2007, Global Gillette was dissolved and incorporated into Procter Gambles other two main divisions, Procter Gamble Beauty and Procter Gamble Household Care. Gillettes brands and products were divided between the two accordingly. The Share Swap Ratio : Under the deal announced, Procter Gamble will pay 0.975 share of its common stock for each share of Gillette common stock. On Wall Street, shares in Gillette closed up nearly 13%, while PG slid 2.1% after the announcement. The Management: Gillettes chief executive James Kilts is to join the board of the merged company, becoming PG vice chairman, while PG chief executive A.G. Lafley will remain chief executive of the merged company. Examining the merger: Type of merger: Procter Gamble being number one in consumer products went into acquiring and merging with other companies like, Germanys Wella AG hair care line in 2003 and it also acquired Clairol for its hair-care lines and Iams Co. for its pet foods. The merger in question; between Procter Gamble and Gillette is thus a merger where the acquiring company is expanding in size of operations and also product offerings. This is thus a horizontal merger. Operational Synergies of the merger: The merger of the two companies will create the worlds largest consumer products conglomerate. Both companies are strong, diversified companies, so one wonders what uncaptured synergies there could be here. PG is adept at taking innovations from one product and transferring it to another product, so there may be opportunities to improve existing Gillette products. In addition, the companies are stating that the merger will give them more negotiating power with the most powerful buyer of consumer products. The deal would give the company even more control over shelf space at the nations retailers and grocers, real estate that is at a premium. Executives at the companies said they believe theyll both be able to grow faster together than separately, with PG opening doors for Gillette in markets such as China and Japan while Gillette bringing PG some product segments that are growing faster than the companys overall current portfolio of products.The merger will make PG the worlds biggest household goods maker, pushing Unilever into second place Financial Synergies: The merger would create a company with revenues of more than Rs.2700 billion that would have even greater clout against mass-market retailers like Wal-Mart Stores Inc., which have been pressuring consumer product suppliers to keep costs low. Because of expectations from the deal, PG raised the annual revenue growth outlook to 5 to 7 percent, rather than its earlier target of 4 to 6 percent. The companies said they expected cost savings and synergies of about Rs.630 billion to Rs.720 billion US over three years. PG and Gillettes combined market capitalization of about Rs 8325 billion US, would be by far the largest in the FMCG sector. HR Synergies: As part of the cost-cutting that would follow the deal, the merger would result in the elimination of about 6,000 jobs, or 4 percent of the combined work force of about 140,000. It said most of the cuts would come from eliminating management overlaps and consolidation of business support functions. Gillettes chief executive James Kilts is to join the board of the merged company, becoming PG vice chairman, while PG chief executive A.G. Lafley will remain chief executive of the merged company. Scenario Post Merger: Procter Gamble is the worlds largest producer of household and personal products by revenue, with its products reaching 4 billion people worldwide and its product line includes 23 brands across beauty, healthcare, and food including Tide detergent, Pampers diapers, and Gillette razors, that generate over $1 billion in revenue annually, with the companys total revenue at Rs.3555 billion in 2009.In 2005, PG expanded its portfolio to include razors and blades as well as batteries with its acquisition of the Gillette Company.The companys 2010 first quarter net income fell 1% to Rs.148.95 billion (Rs.46.35 per share) as higher prices offset lower sales volumes and foreign exchange effects, beating analyst expectations of Rs.43.65 per share. Revenue fell 6% to Rs.891.45 billion, though organic sales rose 2%. One of the key areas of growth for the company is in emerging markets worldwide. Sales in developing nations have increased steadily from 20% of total revenue in 2002 to 32% in 2009.PG already owns large and growing market share in countries includingglobal economic downturn, PG has announced it will focus its growth strategy on emerging markets, opening almost all of its 20 new manufacturing facilities outside its established markets. Procter Gamble attempts to maintain its competitive edge by focusing on product innovation. To this end, PG spends almost twice as much on research and development spending Rs.90 billion in 2009 as its closest competitor, Unilever, spent about Rs.58.5 billion USD in 2008.Through itsConnect + Developinitiative, PG looks to bring in new product ideas from outside the company. Connect + Develop has led to the development of 42% of new PG products in recent years. In fiscal 2009, PGs Net sales fell 3% to Rs.3555 billion driven by a 3% decline in unit volume and a 4% decline in net sales from the rising US dollar. Organic sales, a closely watched figure which excludes the impact of acquisitions, divestitures, andforeign exchange, increased 2%, which is below its target organic sales range of 4-6%.Earnings for fiscal 2009 increased 11% to Rs.603 billion. In July 2009, CEO A.G. Lafley stepped down from his post after 29 years with Proctor Gamble.He was succeeded by current COO Bob McDonald.The company expects sales to be up 0 to 3% in fiscal 2010,with sales back up in the fall of 2009, fed by price cuts, new products, and value-focused promotions. PG divides its business into three Global Business Units (GBUs) that develop and produce products and its corporate group which handles the operation and administration of the company. Beauty (33% of 2009 sales, 36% of 2009 net income): The Beauty GBU includes all hair and skin products, medications, razors, electric shavers, and batteries. This business unit includes several product lines acquired when the PG bought consumer products company Gillette in 2005. Proctor Gambles global market share in blades and razors is 70%, primarily centered on its Mach3, Fusion, Venus, and Gillette brands.In June 2009, PG further expanded its mens grooming business with the acquisition of the high-end shaving company The Art of Shaving and the mens skin care line Zirh. Health and Well-Being (21% of 2009 sales, 24% of 2009 net income): The Health and Well-Being GBU provide oral care, feminine health, pharmaceuticals, snacks, coffee, and pet care products. In oral care, the company has the number two market share position at 20% globally.In potato chips, the companys Pringles brand holds a market share of approximately 10%. Household Care (46.8% of 2009 sales, 43% of 2009 net income): The Household Care GBU manufactures a wide range of products from laundry detergent to diapers. The companys baby care market share in 2008 was 29%. Business Growth and Divestitures Folgers Sale On June 4, 2008, PG sold its Folgers coffee unit toJ.M. Smucker Companyfor Rs.132.75 billion.As part of the deal, PG shareholders will receive a 53.5 percent stake in Smuckers and the company will assume Rs.15750 million of Folgers debt. Gillette Acquisition Procter Gamble acquired Gillette in 2005 for over Rs.2250 billion in its largest acquisition to date. In 2004, the last full year before the acquisition, Gillette generated over Rs.450 billion in sales, about Rs.270 billion of which came from razors and Duracell and Braun products and the remainder sourced from the Oral-B brand, which was moved into the Health Well-Being segment. A key piece of the acquisition beyond Gillettes product lines was its distribution network and supply chain. Gillettes distribution network and supply chain in emerging markets had been extremely successful for Gillette and, once acquired, has worked to complement PGs own distribution network. Sale of Pharmaceutical Unit In 2009 PG sold its pharmaceutical unit to Warner Chilcott Plc for Rs.139.5 billion in cash.The company expects to book a 43 cent per share earnings boost in Q2 of fiscal 2010 as a result of the sale.The deal allows PG to focus on its personal care, beauty, and household product divisions. In 2006, the company started winding down its discover-phase pharmaceutical products in favor of licensing late-stage compounds, and announced in 2008 it would exit the drug industry entirely. PG 2008 Net sales by Geographic Region(Post merger) PG has a well-established market presence in developed countries such as the United States and Western Europe and is looking to its presence in emerging markets. In fiscal 2009, 32% of total net sales came from developing nations,a figure that has increased steadily from 2002 when sales in developing nations accounted for only about 20% of total revenue (approximately Rs.360 billion). In China and Russia, PGs market share has been consistently increasing in the past five years as Procter Gamble has put an increased emphasis on establishing its products in those markets. In 2008, the companys distribution network reached 800 million people in China and 80% of the population in Russia. PG has created products designed specifically to target developing nations. The average Mexican spends about Rs.9000 a year on PG products, Chinese per-capita spending is only about Rs.135 and India per-capita spending Rs.45.Increasing sales in China and India to the levels in Mexico would add Rs.1800 billion in sales to the companys overall revenue. Research Development focuses both inside and outside the company In 2009, PG spent approximately Rs.91.8 billion on Research Development, nearly Rs.45 billion more than its closest competitor, Unilever.The two most important factors in PGs innovation process are its practice of consumer demand research and its Connect and Develop RD structure. First, when entering new markets, PG sets up in-home visits with consumers in order to fully understand the needs and desires consumers have for household and personal products. This way, PG gets directly to its customers and is able to cater to their needs. PG also incorporates consumers input into the RD process through its Connect and Develop initiative. Through Connect and Develop PG has an online interface set up where people can submit product ideas and provide input on topics that PG places on the web-portal. PG staff then sorts through the ideas and work with the most promising ones. This process is not responsible for the entire RD that PG does, but approximately 42% of new products in the last sev eral years were influenced by or originated from Connect and Develop. Tide Stain Release, a stain-removing detergent released in July 2009, has garnered 10% market share in the US as of November 2009.The Bounce Dryer Bar, an automatic laundry freshener released in August 2009, has captured 7% of the North American fabric sheet market as of November 2009. Commodity Prices A diversified consumer products manufacturer, PG depends heavily on a wide basket of global commodities for manufacturing its goods, the prices for which have risen nearly 50% since 2002. Nearly half of the companys cost of goods is directly related to commodity goods. The company has increased prices due to higher costs of oil and other raw materials. In its conference call, the company stated that it expected raw material costs to increase Rs.135 billion in 2009.The company has raised prices on Cascade dishwashing detergent, Iams pet food, and Gillette razors to counter the increasing cost of oil in the first half of 2008.PG instituted broad price adjustments in Q1 2010 to close widening price gaps in several businessesincluding North American laundry, tissue, andtowel, and several Eastern European markets. Competition Procter Gamble provides the broadest and biggest portfolio of products in the household and personal care industry with 24 billion-dollar brands. PG generates 43% more revenue than its closest competitor,LOreal, and Reckitt Benckiser. Here are somekey factsabout the two firms. Cincinnati-based Procter Gamble was established in 1837 and made its name selling soap and candles to U.S. government soldiers during the civil war. Boston-based Gillette spends around Rs.2700 million annually on advertising. In May the razor-maker paid a reported 40 million pounds (Rs.3393 million) to sign international soccer star David Beckham to a three-year deal as its global face. Procter Gamble employs a workforce of 110,000 worldwide and has a market capitalization of Rs.6345 billion. Gillette employs 29,400 employees worldwide and has a market capitalization of Rs.2025 billion. Gillettes profit beat market expectations last October after Hurricane Ivan spurred the buying of Duracell batteries. Limitations: Due to lack of data the financial statements analysis of Procter Gamble was not carried out. Conclusion Thus the acquisition and integration of Gillette was the largest and most successful in the history of Procter Gamble. PG acquired Gillette, which is best known for its shaving products, in 2005 for Rs.2565 billion. The merger between Procter Gamble and Gillette is a horizontal merger where the acquiring company is expanding in size of operations and also product offerings. The merger created various synergies like financial, operation and human resource synergies. After the merger Procter Gamble integrated systems in 26 countries, spanning five geographic regions, representing about 20% of sales. Gillette is a catalyst that makes PG a better brand-builder and a stronger innovation leader. There is no doubt that PG and Gillette are stronger together than alone, and both the companies together can deliver accelerated growth targets over the balance of the decade. Acquisition of Balsarashygiene and home product by Dabur About the merging companies: Dabur Company Dabur India Limitedis the fourth largest FMCG Company in India and Dabur had a turnover of approximately Rs.2,834 Crore Market Capitalisation of over Rs 10,000 Crore, with brands like Dabur Amla, Dabur Chyawanprash, Vatika, Hajmola and Real. The company has kept an eye on new generations of customers with a range of products that cater to a modern lifestyle, while managing not to alienate earlier generations of loyal customers. Dabur has global presence in 50 countries; products are available in the markets of Middle East, South-East Asia, Africa, the European Union andAmerica. Dabur is an investor friendly brand as its financial performance shows. The companys growth rate rose from 10% to 40%. The expected growth rate for two years was two-fold. Theres a great sense of responsibility for investors funds on view. This is a direct extension of Daburs philosophy of taking care of its constituents and it adds to the sense of trust for the brand overall. The company, through Dabur Pharma Ltd. does toxicology tests and markets ayurvedic medicines in a scientific manner. They have researched new medicines which will find use in O.T. all over the country therein opening a new market. Dabur Foods, a subsidiary of Dabur India is expecting to grow at 25%. Its brands of juices, namely, Real and Active, together make it the market leader in the Fruit Juice Category. Dabur Ranked AmongIndias Most Trusted Brands of 2007 By Economic Times-Brand Equity. Products of Dabur Ø Under health care products it has brands like Hajmola, Pudin Hara, Dabur Chyawanprash, Glucose D, Dabur Lal tail,etc. Ø In home care range consist of product like Odinil,Odomos,odopic,etc. Ø Under personal care range it has product like Vatika,Gulabri,Dabur Red Toothpaste,etc. Ø In food range it has brands like Real Active ,HOMMADE-range of ready made pastes, soups, coconut milk tomato puree Ø Dabur has guar gum plant,a natural gum used in foods industrial applications. Ø Dabur also produces ayurvedic medicines. Balsara Company The Balsara Group manufactures and markets its products, in India and Internationally. The Group has a domestic annual sales turnover of Indian Rs. 2 billion, and a rapidly growing international sales turnover of Indian Rs. 350 million. The Group is professionally managed, with manufacturing, sales, distribution and administrative facilities located throughout India, in addition to its international operations. In the Indian market, 60% of the Balsara Groups sales turnover of Indian Rs. 2 billion comes from Personal Hygiene Products (Promise, Babool and Meswak oral care ranges) and 40% is derived from Household Products (Odomos insect repellents, Odonil Air Fresheners, Sani Fresh toilet cleaners and Odopic dish washing products). Balsara has a wide national sales and distribution system that makes products available in 10, 54,000 retail outlets. The system is supported by a distribution network of 4 Zonal Offices, 13 Branches, 24 Regional Warehouses, and 1700 Distributors in 1500 towns. The mission of the Balsara Group of Companies is to be a leading provider of superior quality personal and household products, ingredients and packaging materials to consumers and customers on the Indian sub-continent and throughout the world. The Acquisition: On January 27, 2005 Dabur India today announced the acquisition of Balsara Hygeine and Home Care businesses for Rs. 143 crores and said it would look at more buyouts to capitalise on the consolidation in the sector. The company board of Dabur approved the acquisition of controlling stake in three Balsara group companies Balsara Hygiene Products, Balsara Home Products and Besta Cosmectics. With the acquisition of the Rs. 143-crore Balsara Group in an all cash deal, Dabur India will have oral care brands such as Promise, Babool, Meswak; mosquito repellents such as Odomos and household products such as Odonil and Odopic under its fold. Dabur India will acquire the entire promoters stake in the three companies 99.4 per cent in Balsara Hygiene, 100 per cent in Balsara Home Products and 97.9 per cent in Besta Cosmetics. The Terms of the Acquisition: Date of the acquisition: The merger came into effect from 1st April 2006. The new company formed : According to the deal Dabur will take full control of Balsaras entire brand portfolio which consists of oral care brands like Promise, Babool, Meswak; mosquito repellants like Odomos and household products like Odonil, Odopic. The deal also includes takeover of Balsaras operations consisting of three manufacturing facilities at Kanpur, Silvassa and Baddi and about 600 employees. Dabur India will also acquire the entire promoters stake in the three companies 99.4 per cent in Balsara Hygiene, 100 per cent in Balsara Home Products and 97.9 per cent in Besta Cosmetics. The Share Swap Ratio : Under the deal announced, Dabur India Ltd will acquire Balsaras hygiene and home product businesses in an Rs 143 crore all-cash deal. While Rs 120 crore will be funded through internal accruals, the balance Rs 23 crore will be raised through debt. Examining the Acquisition: Type of merger: The Rs 1,300-crore fast-moving consumer goods major Dabur India acquired Mum Procter Gamble Company Merger Case Study Procter Gamble Company Merger Case Study The project deals with the analysis of mergers and acquisitions in an FMCG sector. Products which have a quick turnover, and relatively low cost are known as Fast Moving Consumer Goods (FMCG). FMCG products are those that get replaced within a year. A merger is the combining of two or more companies, generally by offering the stockholders of one company securities in the acquiring company in exchange for the surrender of their stock. This project deals with the merger of Procter Gamble and Gillette, acquisition of Balsaras hygiene and home product by Dabur and Acquisition of Nihar brand from HLL by Marico. The methodology deals with the various ways in which the data for this project was collected. Due to the limited scope of information and time constraints, secondary and not primary data sources has been used including journals, articles, reference sites, etc. The project guide proved very vital in the successful completion of my report. The next section deals with the individual introduction of both companies involved in the process of merger. It further includes the different terms of the merger and various synergies created through the merger. Furthermore the next section deals with scenario after the merger and analysis of financial statements of acquiring company post merger. Building a brand from scratch in the FMCG space can be quite an expensive exercise. Mature categories such as personal care or household products are already dominated by one or two strong incumbents and wresting market share away from them is quite a challenge. With growth rates in markets such as skin care, hair care and household products suddenly moving into high gear, companies also cannot afford to lose time on the trial-and-error method that usually accompanies new launches. Given this scenario, domestic players seem to view brand acquisitions and mergers as the quickest way to step into new categories and acquire a well-rounded product basket, without squandering their surpluses on brand-building expenses. Market shares apart, many of the buyouts have been motivated by the need to acquire better distribution reach whether within India or overseas. Introduction I. MERGER A merger is the combining of two or more companies, generally by offering the stockholders of one company securities in the acquiring company in exchange for the surrender of their stock. A merger occurs when two or more companies combines and the resulting firm maintains the identity of one of the firms. One or more companies may merge with an existing company or they may merge to form a new company. Usually the assets and liabilities of the smaller firms are merged into those of larger firms. Merger may take two forms- Merger through absorption Merger through consolidation. Absorption: Absorption is a combination of two or more companies into an existing company. All companies except one lose their identity in a merger through absorption. Consolidation: A consolidation is a combination if two or more combines into a new company. In this form of merger all companies are legally dissolved and a new entity is created. In consolidation the acquired company transfers its assets, liabilities and share of the acquiring company for cash or exchange of assets. II. ACQUISITION A fundamental characteristic of merger is that the acquiring company takes over the ownership of other companies and combines their operations with its own operations. An acquisition may be defined as an act of acquiring effective control by one company over the assets or management of another company without any combination of companies. III. TAKEOVER A takeover may also be defined as obtaining control over management of a company by another company.Merger of Procter Gamble Company and Gillette CompanyAbout the merging companies: Procter Gamble Procter Gamble Company is asoap opera. PG was named 2008 Advertiser of the Year by Cannes International Advertising Festival. Effective July 1, 2007, the companys operations are categorized into three Global Business Units with each Global Business Unit divided into Business Segments according to the companys March 2009 earnings release. Beauty Care Beauty segment Grooming segment Household Care Baby Care and Family Care segment Fabric Care and Home Care segment Health and Well-Being Health Care segment Snacks, Coffee, and Pet Care segment PG has gone into an aggressive mode. It has launched two new variants on 2nd Dec 2009, one in the detergent segment, which is called Tide Naturals and also another one in skin care segment under the Olay brand. Gillette Company The Gillette Company is a globally focused consumer products marketer that seeks competitive advantage in quality, value-added personal care and personal use products. It is the world leader in the mens grooming product category as well as in certain womens grooming products. Although more than half of company profits are still derived from shaving equipmentthe area in which the company startedGillette has also attained the top spots worldwide in writing instruments (Paper Mate, Parker, and Waterman brands) and correction products (Liquid Paper), toothbrushes and other oral care products (Oral-B), and alkaline batteries (Duracell products, which generate almost one-fourth of company profits). Gillette maintains 64 manufacturing facilities in 27 countries, and its products are sold in more than 200 countries and territories, with more than 60 percent of sales occurring outside the United States. The Merger: On October 1, 2005, Procter Gamble finalized its purchase of The Gillette Company. As a result of this merger, the Gillette Company no longer exists. Its last day of market trading symbol G on theOral-B, among others, which have also been maintained by PG. The Terms of the Merger: Date of merger: The merger came into effect from July 1st, 2007. The new company formed : The Gillette Companys assets were initially incorporated into a PG unit known internally as Global Gillette. In July 2007, Global Gillette was dissolved and incorporated into Procter Gambles other two main divisions, Procter Gamble Beauty and Procter Gamble Household Care. Gillettes brands and products were divided between the two accordingly. The Share Swap Ratio : Under the deal announced, Procter Gamble will pay 0.975 share of its common stock for each share of Gillette common stock. On Wall Street, shares in Gillette closed up nearly 13%, while PG slid 2.1% after the announcement. The Management: Gillettes chief executive James Kilts is to join the board of the merged company, becoming PG vice chairman, while PG chief executive A.G. Lafley will remain chief executive of the merged company. Examining the merger: Type of merger: Procter Gamble being number one in consumer products went into acquiring and merging with other companies like, Germanys Wella AG hair care line in 2003 and it also acquired Clairol for its hair-care lines and Iams Co. for its pet foods. The merger in question; between Procter Gamble and Gillette is thus a merger where the acquiring company is expanding in size of operations and also product offerings. This is thus a horizontal merger. Operational Synergies of the merger: The merger of the two companies will create the worlds largest consumer products conglomerate. Both companies are strong, diversified companies, so one wonders what uncaptured synergies there could be here. PG is adept at taking innovations from one product and transferring it to another product, so there may be opportunities to improve existing Gillette products. In addition, the companies are stating that the merger will give them more negotiating power with the most powerful buyer of consumer products. The deal would give the company even more control over shelf space at the nations retailers and grocers, real estate that is at a premium. Executives at the companies said they believe theyll both be able to grow faster together than separately, with PG opening doors for Gillette in markets such as China and Japan while Gillette bringing PG some product segments that are growing faster than the companys overall current portfolio of products.The merger will make PG the worlds biggest household goods maker, pushing Unilever into second place Financial Synergies: The merger would create a company with revenues of more than Rs.2700 billion that would have even greater clout against mass-market retailers like Wal-Mart Stores Inc., which have been pressuring consumer product suppliers to keep costs low. Because of expectations from the deal, PG raised the annual revenue growth outlook to 5 to 7 percent, rather than its earlier target of 4 to 6 percent. The companies said they expected cost savings and synergies of about Rs.630 billion to Rs.720 billion US over three years. PG and Gillettes combined market capitalization of about Rs 8325 billion US, would be by far the largest in the FMCG sector. HR Synergies: As part of the cost-cutting that would follow the deal, the merger would result in the elimination of about 6,000 jobs, or 4 percent of the combined work force of about 140,000. It said most of the cuts would come from eliminating management overlaps and consolidation of business support functions. Gillettes chief executive James Kilts is to join the board of the merged company, becoming PG vice chairman, while PG chief executive A.G. Lafley will remain chief executive of the merged company. Scenario Post Merger: Procter Gamble is the worlds largest producer of household and personal products by revenue, with its products reaching 4 billion people worldwide and its product line includes 23 brands across beauty, healthcare, and food including Tide detergent, Pampers diapers, and Gillette razors, that generate over $1 billion in revenue annually, with the companys total revenue at Rs.3555 billion in 2009.In 2005, PG expanded its portfolio to include razors and blades as well as batteries with its acquisition of the Gillette Company.The companys 2010 first quarter net income fell 1% to Rs.148.95 billion (Rs.46.35 per share) as higher prices offset lower sales volumes and foreign exchange effects, beating analyst expectations of Rs.43.65 per share. Revenue fell 6% to Rs.891.45 billion, though organic sales rose 2%. One of the key areas of growth for the company is in emerging markets worldwide. Sales in developing nations have increased steadily from 20% of total revenue in 2002 to 32% in 2009.PG already owns large and growing market share in countries includingglobal economic downturn, PG has announced it will focus its growth strategy on emerging markets, opening almost all of its 20 new manufacturing facilities outside its established markets. Procter Gamble attempts to maintain its competitive edge by focusing on product innovation. To this end, PG spends almost twice as much on research and development spending Rs.90 billion in 2009 as its closest competitor, Unilever, spent about Rs.58.5 billion USD in 2008.Through itsConnect + Developinitiative, PG looks to bring in new product ideas from outside the company. Connect + Develop has led to the development of 42% of new PG products in recent years. In fiscal 2009, PGs Net sales fell 3% to Rs.3555 billion driven by a 3% decline in unit volume and a 4% decline in net sales from the rising US dollar. Organic sales, a closely watched figure which excludes the impact of acquisitions, divestitures, andforeign exchange, increased 2%, which is below its target organic sales range of 4-6%.Earnings for fiscal 2009 increased 11% to Rs.603 billion. In July 2009, CEO A.G. Lafley stepped down from his post after 29 years with Proctor Gamble.He was succeeded by current COO Bob McDonald.The company expects sales to be up 0 to 3% in fiscal 2010,with sales back up in the fall of 2009, fed by price cuts, new products, and value-focused promotions. PG divides its business into three Global Business Units (GBUs) that develop and produce products and its corporate group which handles the operation and administration of the company. Beauty (33% of 2009 sales, 36% of 2009 net income): The Beauty GBU includes all hair and skin products, medications, razors, electric shavers, and batteries. This business unit includes several product lines acquired when the PG bought consumer products company Gillette in 2005. Proctor Gambles global market share in blades and razors is 70%, primarily centered on its Mach3, Fusion, Venus, and Gillette brands.In June 2009, PG further expanded its mens grooming business with the acquisition of the high-end shaving company The Art of Shaving and the mens skin care line Zirh. Health and Well-Being (21% of 2009 sales, 24% of 2009 net income): The Health and Well-Being GBU provide oral care, feminine health, pharmaceuticals, snacks, coffee, and pet care products. In oral care, the company has the number two market share position at 20% globally.In potato chips, the companys Pringles brand holds a market share of approximately 10%. Household Care (46.8% of 2009 sales, 43% of 2009 net income): The Household Care GBU manufactures a wide range of products from laundry detergent to diapers. The companys baby care market share in 2008 was 29%. Business Growth and Divestitures Folgers Sale On June 4, 2008, PG sold its Folgers coffee unit toJ.M. Smucker Companyfor Rs.132.75 billion.As part of the deal, PG shareholders will receive a 53.5 percent stake in Smuckers and the company will assume Rs.15750 million of Folgers debt. Gillette Acquisition Procter Gamble acquired Gillette in 2005 for over Rs.2250 billion in its largest acquisition to date. In 2004, the last full year before the acquisition, Gillette generated over Rs.450 billion in sales, about Rs.270 billion of which came from razors and Duracell and Braun products and the remainder sourced from the Oral-B brand, which was moved into the Health Well-Being segment. A key piece of the acquisition beyond Gillettes product lines was its distribution network and supply chain. Gillettes distribution network and supply chain in emerging markets had been extremely successful for Gillette and, once acquired, has worked to complement PGs own distribution network. Sale of Pharmaceutical Unit In 2009 PG sold its pharmaceutical unit to Warner Chilcott Plc for Rs.139.5 billion in cash.The company expects to book a 43 cent per share earnings boost in Q2 of fiscal 2010 as a result of the sale.The deal allows PG to focus on its personal care, beauty, and household product divisions. In 2006, the company started winding down its discover-phase pharmaceutical products in favor of licensing late-stage compounds, and announced in 2008 it would exit the drug industry entirely. PG 2008 Net sales by Geographic Region(Post merger) PG has a well-established market presence in developed countries such as the United States and Western Europe and is looking to its presence in emerging markets. In fiscal 2009, 32% of total net sales came from developing nations,a figure that has increased steadily from 2002 when sales in developing nations accounted for only about 20% of total revenue (approximately Rs.360 billion). In China and Russia, PGs market share has been consistently increasing in the past five years as Procter Gamble has put an increased emphasis on establishing its products in those markets. In 2008, the companys distribution network reached 800 million people in China and 80% of the population in Russia. PG has created products designed specifically to target developing nations. The average Mexican spends about Rs.9000 a year on PG products, Chinese per-capita spending is only about Rs.135 and India per-capita spending Rs.45.Increasing sales in China and India to the levels in Mexico would add Rs.1800 billion in sales to the companys overall revenue. Research Development focuses both inside and outside the company In 2009, PG spent approximately Rs.91.8 billion on Research Development, nearly Rs.45 billion more than its closest competitor, Unilever.The two most important factors in PGs innovation process are its practice of consumer demand research and its Connect and Develop RD structure. First, when entering new markets, PG sets up in-home visits with consumers in order to fully understand the needs and desires consumers have for household and personal products. This way, PG gets directly to its customers and is able to cater to their needs. PG also incorporates consumers input into the RD process through its Connect and Develop initiative. Through Connect and Develop PG has an online interface set up where people can submit product ideas and provide input on topics that PG places on the web-portal. PG staff then sorts through the ideas and work with the most promising ones. This process is not responsible for the entire RD that PG does, but approximately 42% of new products in the last sev eral years were influenced by or originated from Connect and Develop. Tide Stain Release, a stain-removing detergent released in July 2009, has garnered 10% market share in the US as of November 2009.The Bounce Dryer Bar, an automatic laundry freshener released in August 2009, has captured 7% of the North American fabric sheet market as of November 2009. Commodity Prices A diversified consumer products manufacturer, PG depends heavily on a wide basket of global commodities for manufacturing its goods, the prices for which have risen nearly 50% since 2002. Nearly half of the companys cost of goods is directly related to commodity goods. The company has increased prices due to higher costs of oil and other raw materials. In its conference call, the company stated that it expected raw material costs to increase Rs.135 billion in 2009.The company has raised prices on Cascade dishwashing detergent, Iams pet food, and Gillette razors to counter the increasing cost of oil in the first half of 2008.PG instituted broad price adjustments in Q1 2010 to close widening price gaps in several businessesincluding North American laundry, tissue, andtowel, and several Eastern European markets. Competition Procter Gamble provides the broadest and biggest portfolio of products in the household and personal care industry with 24 billion-dollar brands. PG generates 43% more revenue than its closest competitor,LOreal, and Reckitt Benckiser. Here are somekey factsabout the two firms. Cincinnati-based Procter Gamble was established in 1837 and made its name selling soap and candles to U.S. government soldiers during the civil war. Boston-based Gillette spends around Rs.2700 million annually on advertising. In May the razor-maker paid a reported 40 million pounds (Rs.3393 million) to sign international soccer star David Beckham to a three-year deal as its global face. Procter Gamble employs a workforce of 110,000 worldwide and has a market capitalization of Rs.6345 billion. Gillette employs 29,400 employees worldwide and has a market capitalization of Rs.2025 billion. Gillettes profit beat market expectations last October after Hurricane Ivan spurred the buying of Duracell batteries. Limitations: Due to lack of data the financial statements analysis of Procter Gamble was not carried out. Conclusion Thus the acquisition and integration of Gillette was the largest and most successful in the history of Procter Gamble. PG acquired Gillette, which is best known for its shaving products, in 2005 for Rs.2565 billion. The merger between Procter Gamble and Gillette is a horizontal merger where the acquiring company is expanding in size of operations and also product offerings. The merger created various synergies like financial, operation and human resource synergies. After the merger Procter Gamble integrated systems in 26 countries, spanning five geographic regions, representing about 20% of sales. Gillette is a catalyst that makes PG a better brand-builder and a stronger innovation leader. There is no doubt that PG and Gillette are stronger together than alone, and both the companies together can deliver accelerated growth targets over the balance of the decade. Acquisition of Balsarashygiene and home product by Dabur About the merging companies: Dabur Company Dabur India Limitedis the fourth largest FMCG Company in India and Dabur had a turnover of approximately Rs.2,834 Crore Market Capitalisation of over Rs 10,000 Crore, with brands like Dabur Amla, Dabur Chyawanprash, Vatika, Hajmola and Real. The company has kept an eye on new generations of customers with a range of products that cater to a modern lifestyle, while managing not to alienate earlier generations of loyal customers. Dabur has global presence in 50 countries; products are available in the markets of Middle East, South-East Asia, Africa, the European Union andAmerica. Dabur is an investor friendly brand as its financial performance shows. The companys growth rate rose from 10% to 40%. The expected growth rate for two years was two-fold. Theres a great sense of responsibility for investors funds on view. This is a direct extension of Daburs philosophy of taking care of its constituents and it adds to the sense of trust for the brand overall. The company, through Dabur Pharma Ltd. does toxicology tests and markets ayurvedic medicines in a scientific manner. They have researched new medicines which will find use in O.T. all over the country therein opening a new market. Dabur Foods, a subsidiary of Dabur India is expecting to grow at 25%. Its brands of juices, namely, Real and Active, together make it the market leader in the Fruit Juice Category. Dabur Ranked AmongIndias Most Trusted Brands of 2007 By Economic Times-Brand Equity. Products of Dabur Ø Under health care products it has brands like Hajmola, Pudin Hara, Dabur Chyawanprash, Glucose D, Dabur Lal tail,etc. Ø In home care range consist of product like Odinil,Odomos,odopic,etc. Ø Under personal care range it has product like Vatika,Gulabri,Dabur Red Toothpaste,etc. Ø In food range it has brands like Real Active ,HOMMADE-range of ready made pastes, soups, coconut milk tomato puree Ø Dabur has guar gum plant,a natural gum used in foods industrial applications. Ø Dabur also produces ayurvedic medicines. Balsara Company The Balsara Group manufactures and markets its products, in India and Internationally. The Group has a domestic annual sales turnover of Indian Rs. 2 billion, and a rapidly growing international sales turnover of Indian Rs. 350 million. The Group is professionally managed, with manufacturing, sales, distribution and administrative facilities located throughout India, in addition to its international operations. In the Indian market, 60% of the Balsara Groups sales turnover of Indian Rs. 2 billion comes from Personal Hygiene Products (Promise, Babool and Meswak oral care ranges) and 40% is derived from Household Products (Odomos insect repellents, Odonil Air Fresheners, Sani Fresh toilet cleaners and Odopic dish washing products). Balsara has a wide national sales and distribution system that makes products available in 10, 54,000 retail outlets. The system is supported by a distribution network of 4 Zonal Offices, 13 Branches, 24 Regional Warehouses, and 1700 Distributors in 1500 towns. The mission of the Balsara Group of Companies is to be a leading provider of superior quality personal and household products, ingredients and packaging materials to consumers and customers on the Indian sub-continent and throughout the world. The Acquisition: On January 27, 2005 Dabur India today announced the acquisition of Balsara Hygeine and Home Care businesses for Rs. 143 crores and said it would look at more buyouts to capitalise on the consolidation in the sector. The company board of Dabur approved the acquisition of controlling stake in three Balsara group companies Balsara Hygiene Products, Balsara Home Products and Besta Cosmectics. With the acquisition of the Rs. 143-crore Balsara Group in an all cash deal, Dabur India will have oral care brands such as Promise, Babool, Meswak; mosquito repellents such as Odomos and household products such as Odonil and Odopic under its fold. Dabur India will acquire the entire promoters stake in the three companies 99.4 per cent in Balsara Hygiene, 100 per cent in Balsara Home Products and 97.9 per cent in Besta Cosmetics. The Terms of the Acquisition: Date of the acquisition: The merger came into effect from 1st April 2006. The new company formed : According to the deal Dabur will take full control of Balsaras entire brand portfolio which consists of oral care brands like Promise, Babool, Meswak; mosquito repellants like Odomos and household products like Odonil, Odopic. The deal also includes takeover of Balsaras operations consisting of three manufacturing facilities at Kanpur, Silvassa and Baddi and about 600 employees. Dabur India will also acquire the entire promoters stake in the three companies 99.4 per cent in Balsara Hygiene, 100 per cent in Balsara Home Products and 97.9 per cent in Besta Cosmetics. The Share Swap Ratio : Under the deal announced, Dabur India Ltd will acquire Balsaras hygiene and home product businesses in an Rs 143 crore all-cash deal. While Rs 120 crore will be funded through internal accruals, the balance Rs 23 crore will be raised through debt. Examining the Acquisition: Type of merger: The Rs 1,300-crore fast-moving consumer goods major Dabur India acquired Mum