Airline Industry: Pricing Structure and Strategies Essay

ABSTRACT The profitability of an airline industry depends on filling seats, and on the company’s ability successfully to anticipate the cost and price structures of their competitors. However, many airline carriers have a hard time accomplishing this because the average airline passenger just needs to travel from one destination to another in the most convenient and shortest amount of time at a reasonable price. Therefore, customers in this market are not as loyal to one specific airline (brand) in the industries. The reason for this is that airline carriers provide the same services at similar prices. In addition, the passenger will only incur high switching costs if they choose to take another mode of less desirable transportation. Airline carriers have overcome these problems by using the strategy of â€Å"Price discrimination.† That is a strategy that allows them adequately to segment their potential passengers, and to offer different pricing structures that match passengers’ sensitivity to price and value differences in cost to serve, and their different competitive positions (Stern, 1989). While it also allows passengers to maximize their â€Å"expected utility† when flying with the airline carrier that meets their needs. The 1978 deregulation of the airline industry has resulted in airline carriers being unable to make a profit by filling seats, and successfully to anticipate the cost and price structures of their competitors (Bailey, David, Graham, Kaplan 1985). According to statistic, the airline industries’ profits declined in 2001 through 2003 by $23.2 billion (Smith Jr. & Cox). During this time the average airline passenger just needed to travel from one destination to another in the most convenient and shortest amount of time at a reasonable price. However, because all airline carriers provide the same services at similar prices, the passengers in this market are not as loyal to one specific airline (brand). For, example, any passengers not able to purchase a flight plan that they value, will not necessary buy the next best plan offered. Instead, these price-sensitive passengers will gravitate toward a lower-cost competitor  airline (Smith Jr. & Cox). This is especially true in this particular industry because a passenger will only incur high switching costs if they chose to take another mode of less desirable transportation. Therefore, many airline carriers had a hard time making a profit or breaking even (Brady, & Cunningham, 2001). In addition, this same deregulation of the industry provided new companies the opportunity to enter an already competitive market (Bailey, David, Graham, Kaplan. 1985). This stressed the market because pricing strategies that airlines used in the past did not adequately different between price sensitive passengers and price insensitive in this market (Sterns, 1989). Therefore, many airline carriers could not â€Å"capitalize on opportunities that [would] influence customer and [their] competitor responses (Stern, 1989). Because of this lost of profit, many airline carriers were force to file bankruptcy (Brady, & Cunningham, 2001). Therefore, as a reaction to these, external pressures many of the remaining companies (American, United, Continental, Northwest, US Air, and Delta) developed complex pricing strategies that would help them to outmaneuver their rivals (Smith Jr. & Cox). Different pricing structures were developed that allow them to match passengers’ sensitivity to pr ice and value differences in cost to serve, and their different competitive positions (Stern, 1989). In addition, sense airline carriers offer a product that is homogenous; to be successful they had to offer a product that potential passengers would view as different from their competitors’ product (Westermann, 2005). One strategy that airline carriers’ use is â€Å"differentiated pricing, which is a form of â€Å"price discrimination.† That is a strategy, which many companies’ uses because it allows them to charge different prices to different customer. However, airline carriers use this strategy by offering fare discounts.[1] This strategy allows the airline carriers to get as much consumer surplus as possible from each group of passengers, given his or her utility functions and income. Once they have determine their potential passengers expected utility from flying and income â€Å"Pricing ladders† are then used to charged for seats on a flight by segmenting travelers by their identity, destination, number of days between the day of reservation, the day of travel, the day, and time of departure, the day and time of return (Currie,  & Simpson, 2009). Many airline carriers and other companies are able legally to accomplish price discrimination and use pricing ladders because not all passengers have the ability or willingness to pay the higher or lower prices when they are offered (p.331 ). Identifying price discrimination Placing restrictions on purchase and use â€Å"Price discrimination† is a way to increase prices to improve profit margins by offering substantial discounts on bundles (McAfee, 2008). Price discriminate is accomplished by airline carriers’ when they offer potential passenger that satisfy certain demographics considerations a range of packages, or combinations of fares and restrictions attached to the purchase of their tickets (Stavins, 1996 & Anderson, & Renault, 2008). This pricing discrimination strategy â€Å"†¦ is known as second-degree or self-selection price discrimination (Stavins, 1996). Under this strategy, the airline is able perfectly to segment potentials passengers into groups according to their willingness to pay (Currie, & Simpson, 2009). Airline carriers are then able to offer them the highest fare in the ladder that they are happy to pay (Currie, & Simpson, 2009). While at the same time allowing passengers â€Å"†¦to choose [other] preferred versions of a product based on their willingness to pay for specific attributes of the good (e.g., time, convenience, flexibility)† (Stavins, 1996) [The citation for a direct quote needs the page number] . The pricing strategies is successful because it allow airline carriers to match â€Å"†¦the passengers relative ‘utility’ across competing products (where multiple factors are considered, including price, departure times, elapsed times, etc† (Ratiiff & Vinod). Therefore, companies were able to charge passengers on the same airline flight different prices for the same service and product. Nevertheless, several practices that involve selling services and or products for different prices can be viewed discriminatory (Anderson, & Renault, 2008). Airline carriers however justified this price discrimination by their cost differences and their demand-base (Anderson, & Renault, 2008). That includes â€Å"†¦the service quality/price sensitivity of various air travelers and offer differential fare/service quality packages  designed for each† (Smith Jr. & Cox). The second type of price discriminations that airline carriers use is the rationing and limiting of the supply of the cheaper goods (Stavins, 1996). One way airlines accomplish this is by adding various restrictions to cheaper or discounted tickets (Stavins, 1996). The discounted ticket is offered to passengers willing to stay at their destination a specific amount of time (Saturday-night stay over) or willing to purchasing their ticket in advance (Stavins, 1996). They also offer their potential passenger a discount or cheaper rate for their bundle roundtrips tickets. These are strategies that allows airline carriers to further separate â€Å"†¦price-sensitive passenger [that have a low disutility] from travel restrictions from price-inelastic [passengers that have a] high disutility from ticket restrictions† goods (Stavins, 1996). However, not all passengers value these types of discounts, especially business travelers. This is because even though this segment of passengers is less price sensitive, they are also less flexible concerning their flight arrangement (Stavins, 1996). Therefore, airline carriers can charge this segment of travelers premium seat fees because they prefer the flexibility that their one-way tickets offer. They also offer them frequent flier plans to help induce them to favor their particular carriers, even when ticket prices and restrictions are higher than their competitor (Stavins, 1996). â€Å"yield management† systems have also enabled airline carriers effectively to determine how many last-minute business travelers will show up willing to pay whatever it takes to get on a given flight (MCCARTNEY, 1997). Whereas, they charge this segment of passengers for their seats, leisure travelers on the same flight are offered a discount price, which is not necessarily based on the price of their ticket, but instead on the flight itinerary (Stern, 1989). These discounts and cheaper tickets are an economic value that this segment of passengers will obliviously value. This is because these potential passengers are more concern about price than the flight schedule (McAfee, 2008 Stavins, 1996). It is a pricing policy that allows airline carriers to provide a wider range of choices, which allow  potential passengers to determine the products and services that best meet their needs. Thereby, passenger satisfaction and loyalty is increased, and the airline carrier is also able to optimize their revenues by up charging different prices for the same seat on their airline (Stern, 1989). However, it is important to note that in today airline hyperturbluent environment airlines ticket prices change frequently in response to supply and demand and to changes in the prices of competitors’ fares (http://www.airlines.org/products/AirlineHandbookCh3.htm). This has resulted in many airline carriers unbundling services that traditionally came with the purchase of a seat, such as baggage checking, seat reservations and even the ability to pay by credit card. The benefits of these strategic practices have increased the revenue of airlines. It has also resulted in some passengers paying only for what the use. While for others that need to check a bag, and do not pay with cash, the cost of the seat will be more. Nevertheless, no company can price discriminate successfully, if they do not have some market power to charge prices above marginal cost (Stavins, 1996). In addition, they must have a diverse population of potential passengers, which they can adequately segment (Stavins, 1996). The â€Å"†¦product resale must be impossible or costly, to prevent arbitrage† (Stavins, 1996) [Needs page number] . The airline carriers’ industries however can accomplish price discrimination because of their hub-and-spoke systems (Stavins, 1996). These system allow different airline carriers to differentiate among themselves by â€Å"†¦occupying different slots in flight schedules, and by offering different route networks† (Stavins, 1996) [Needs page number] . These differentiation in flight routes, flight frequency, and airport dominance has allow many airline carriers obtain â€Å"†¦market power even on relatively competitive routes† (Stavins, 1996) [Needs page number] . Therefore, airline carriers may have market power in some market segments, but in others they do not, which results in higher price discrimination on their more competitive routes (Stavins, 1996). Conclusion Price discrimination is usually thought of as a way to extract as much consumer surplus as possible from each group of consumers, given his or her  utility functions and income. It is a strategy therefore associated with raising prices for less elastic consumers. But in the case of airline carriers, price discrimination is exhibited [Passive voice] through fare discounts. Consumers maximize their expected utility from flying. They choose between various price restriction packages, such as between low price-high inconvenience and high price-no restrictions combinations. The choice depends on the consumer’s elasticity of demand with respect to convenience, time, or money REFERENCES Anderson, Simon P., & Renault, Rà ©gis. August 2008. Price Discrimination. Retrieved 20 April 2010 from http://www.virginia.edu/economics/ Bailey, Elizabeth E., David R. Graham, and Daniel P. Kaplan. 1985. Deregulating the Airline. Cambridge, Mass.: MIT Press. Brady, Stephan, Cunningham, William. Predatory Pricing in the Airline Industry. :Transportation Journal; Fall2001, Vol. 41 Issue 1, p5, 11p Currie, Christine S.M., and Daniel Simpson. â€Å"Optimal pricing ladders for the sale of airline tickets.† Journal of Revenue & Pricing Management 8.1 (2009): 96+. Academic One File. Web. 20 Apr. 2010. Graham, David R., Daniel P. Kaplan, and David S. Sibley. 1983. â€Å"Efficiency and Competition in the Airline Industry.† Bell Journal of Economics, vol. 14 (Spring), pp. 118-38. McAfee , R. , Preston , PRICE DISCRIMINATION, 1 ISSUES IN COMPETITION LAW AND POLICY 465 (ABA Section of Antitrust Law 2008) McAfee , R. , Preston, & Vera te Velde. Dynamic Pricing in the Airline Industry. http://www.mcafee.cc/Papers/PDF/DynamicPriceDiscrimination.pdf MCCARTNEY, SCOTT Airlines Rely on Technology To Manipulate Fare Structure The Wall Street Journal Interactive Edition November 3, 1997. http://www.nd.edu/~mgrecon/datafiles/articles/airlinefarestructure.html Ratiiff, Richard& Vinod, Ben. FUTURE OF REVENUE MANAGEMENT Airline pricing and revenue management: A future outlook Stavins, Joanna. Price Discrimination in the Airline Market: The Effect of Market Concentration. November 25, 1996 Stavins, J. (2001) â€Å"Price Discrimination in the Airline Market : The Effect of Market Concentration†, The Review of Economics and Statistics, 83, 1, 200-202. Stern Andrew, A. Pricing and Differentiation Strategies. Planning Review. Sep/Oct 1989, 17, 5. Retrieved 20 April 21, 2010, from ABI/INFORM Westermann, Dieter, (Realtime) dynamic pricing in an integrated revenue management and pricing environment: An approach to handling undifferentiated fare structures in low-fare markets: Journal of Revenue & Pricing Management; Jan2006, Vol. 4 Issue 4, p389-405, 17p, 4 http://www.airlines.org/products/AirlineHandbookCh3.htm

Great Expectations Essay

Magwitch is simply portrayed as an evil man chasing a little boy while in the Lean version we get to learn a little more about Magwitch and can empathise with him more. The 1946 Lean version incorporates both characterisation and maintaining the audience’s interest (done through dialogue rather than just one dramatic word). Therefore, I would argue it is more effective. The sound effects used in both films are dramatic and each has moments where the sounds used are more effective than the other film. For example, Lean’s film makes use of trees creaking, wind whistling, a short sharp scream and loud lonely bird calls. These sounds build up the effect of loneliness and solitude surrounding Pip. This is effective because it allows the audience to become emotionally attached to the character which makes it more dramatic when Pip meets Magwitch. On the other hand, the 1999 version of the film makes use of heavy breathing and very loud sudden bird calls. These sound effects are mote dramatic than the other film’s effects because the birds and heavy breathing are very loud and upfront rather than subtle. They really add to the scene and so I believe both the films have equally effective sound effects. A heavy use of symbolism is evident in both films. In the Lean version some symbolism used includes the book at the beginning. This represents that a story is about to be retold and the pages of the book turning suggest that the audience are being immersed into a story. The book may also be a subtle tribute to Dickens from Lean who acknowledges that the film is based on a novel. In fact, Lean tries to remain faithful to some of Dickens’ descriptions such as the horizontal lines in the sky. The shot of Magwitch’s dirty skin is also an interesting use of symbolism. This is very effective because not only does it introduce us to Magwitch’s circumstances but it also helps develop an alternate side to him. The dirt on his skin not only suggests that he is different underneath but also shows that he has been through a lot. The contrast in colouring between Magwitch’s dark hand and Pip’s pale skin also reiterates how Magwitch is more evil and Pip is vulnerable. It is very effective because it has many purposes and is done very subtly. There is also symbolism in the later film and an interesting example is the birds flying in the sky. The quick transition from Pip’s face to the flying birds suggests to the audience that something terrible is happening. The timing of the cut suggests that the birds’ caws are covering what would be the boy’s screams. There is also the symbolism in that birds are free and can fly away from trouble while Pip is limited and can not get away so easily. I would argue that there is more important symbolism that has more purposes in the Lean version because there is a tribute to Dickens and it is used to develop the characters and plotline while the later film mainly uses symbolism for dramatic effect only. One way in which the earlier version is very good is in the use of the camera. One place where it is very effective is when there is a long shot panning behind a tree in a graveyard it is possibly a point of view shot. This not only sets the scene and establishes the background due to the long-shot but also creates the feeling that the audience are hiding and watching the boy. This makes them wonder what will happen to the boy as the audience will not know at this moment whether the character whose view we are taking has good or bad intentions. There is editing where there is flicking from one shot to another and this builds tension and creates confusion. This is used in the dialogue between Pip and Magwitch to show the urgency of the situation. Between this rapid editing the shots are mainly extreme close ups of Magwitch’s face to create fear and close-ups of Pip so his emotions are very clear to the audience. The 1946 film has a lot of variations in shot however; the 1999 film mainly uses point of view and mid-shots which are interesting because they allow the audience to stay close to what is going on. Yet the variety in the Lean film keeps the audience’s interest engaged. There would not have been a choice at the time the film was made but because the film is in black and white it is often very striking as the black white and grey seem minimalist but they still strongly contrast. Lean uses the black and white to create stark contrasts in the sky and background to emphasise the eeriness and loneliness of the setting. So although he can not make full use of the colour that the later film can Lean uses the contrasts in symbolism. Overall, I would say that although both films have very good openings the earlier one has more ways that make it a better introduction to the story as a whole. Generally I feel that the Lean film has shots that allow for more characterisation and development of plot while also making the vital dramatic impact that is imperative to retain the interest of an audience. Show preview only The above preview is unformatted text This student written piece of work is one of many that can be found in our GCSE Miscellaneous section.

Alcoholism diseases for mankinds Essay Example | Topics and Well Written Essays - 750 words

Alcoholism diseases for mankinds - Essay Example ic, and environmental factors that influences its advancement and manifestation and it is associated with many possible causes and numerous detrimental effects on the alcoholic. Some of the alcoholism diseases of mankind are liver cirrhosis, schizophrenia, and hepatitis C infection. According to MedicineNet (2014), liver cirrhosis is one of the most severe forms of alcoholic related liver diseases especially amongst people drinking excessively. The disease normally see the healthy cells of the liver tissue replaced by scar tissue in the process known as fibrosis thus making the liver tissue to become lumpy and hard instead of smooth. Some of the early symptoms of alcohol induced cirrhosis include loss of appetite, feeling sick and vomiting, itchy skin, and weight loss. However, when the conditions progresses the symptoms may include yellowing of skin, swelling in the abdomen, muscle wasting, bruising and bleeding easily, confused feeling, or having poor memory and sexual changes. It is worth noting that liver always has significant function of processing alcohol one drinks. Conversely, it can only handle a specific amount of alcohol and therefore heavy or regular drinking puts strain and eventually damages the liver. The damage on the liver makes it less able to perform the function of processing chemical substances, which is a risky because the gradual damage on the liver may finally make it stop working properly (MedicineNet, 2014). Many alcoholics have ended up dying because of inappropriate medication or fatal cases of alcohol induced liver cirrhosis. The damage caused on the liver is irreversible although further damage may be stopped if individuals stop drinking. There a number of heavy drinkers who have undergone liver transplant because of their damaged livers. Additionally, the second disease caused by alcoholism is schizophrenia mostly because alcohol is highly abused apart from nicotine. People suffering from schizophrenia consume alcohol for same

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Organizational strategy Case Study Example | Topics and Well Written Essays - 2250 words

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My First Assignment as an Executive Assistant Essay

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Millennial Generation

Millennial Generation Chapter 1 Introduction 1.1 Overview The current world that we live now is being strongly influenced by the high technology waves. This kind of waves are altering our operations in business sectors like finance, economic, accounting and as well as insurance. Internet and its connectivity are increasingly important as the role of connecting people all over the world in the most cheapest and efficiency way. It is now become a necessary in all the peoples lives. According to the research, there are around 9.3 million people in Malaysia age 15 and above using internet at home or work locations, each of them consuming average of 1,066 pages of content and spending 14 hours online in June, 2009 (Comscore,2009). Internet is a new distribution channel for businesses to market and promote their products and services in order to increase their revenues, profitability and customers loyalty. For successfully enter and adapt in the new evolution of technology and electronic, businesses had change their operation structures into tec hnology-intensive based. Some businesses from shops to financial institutions even changed most of their products and services into E-based products or services. Generation Y also can be known as â€Å"Millennial Generation†. From its name, it obviously stated that this generation closely related to high technology and digital electronics. This generation mostly owned computer and have higher education. They frequently used high-technology products and services and they willing to be the innovator for using new E-product. Generation Y is an influential factor towards the future development in E-based services and products. Therefore, most businesses will focus their customer target on generation Y in the coming years. We are now entering into new phase of technology and electronics. With trimness of electronics technology many electronic tools and gadgets have become increasingly personal and portable. It makes people can surf net whenever and wherever they are. The conveniences of communication and networking have stimulated the growth of E-commerce. E-commerce can be translated as any form of businesses that using information technology for transaction. In order to stay ahead in millennium age, most of the companies used E-commerce regardless of business to business (B2B) or business to customer (B2C) or even customer to customer (C2C) (Ahonen, 2004). Services sector like banking also promote internet banking or online banking to facilitate their efficiency in the banking transaction. Online banking can reduce some unnecessarily procedures and provides convenience to customers. Yet insurance industry has been lagging behind others services industries in adapting new technology era. In addition, there are many researches done for investigating the factors that affect adoption of internet among different sectors in Malaysia (Stevens, 2002; Soliman, 2003; Wirtz, 2001; Coltman, 2001), but empirical data for e-insurance was limited due to insurance industry has been slow respond to e-commerce compared to other financial services (Esters, 1997). Insurance institutions have the direct competition with banking and financial institutions. It is the great time for insurance companies to utilize the convenience of communications and networking in establishing direct interface with customers. E-insurance is broadly defined as distribution of insurance services through information technology. The direct channel can eliminates the intermediaries, provides more efficiency, lower cost and more value added to the customers. Other than online purchases, E-insurance can offer varied types of services like online payments, register claims, review claims and renew insurance policy. Besides that, e-insurance also can reduce the level of management hierarchy and internal administration cost by automating all the business processes. There are some limitations of the regulatory for fully applied the e-commerce in certain countries. However, the insurance legislation world wide has been continuously updated and modified to fulfil e-insurance m etrics (Ahonen, 2007). This study examines the perception and expectation of generation Y towards E-insurance. It discusses about the existing e-commerce applied in insurance industry and the expectation of generation Y on the improvement in E-insurance in the future. The new high technology and electronic era started, it links the generation Y and the insurance industry together. It is important to examine the relationship between generation Y and E-insurance. Generation Y act as knowledgeable customers, they are pursuing simple, convenient, fast and efficiency services at lower prices. Therefore, it is the need for insurance companies to introduce E-insurance that satisfied the customers need. 1.2 Statement of problem E-commerce had widespread all over the various business from education to real estate sector. It will continue to grow up unabatedly because information is now the lifeblood of successful business. The importance of e-commerce can be seen from the Ninth Malaysian Plan (2006-2010); Malaysian Government has allocated RM 12.9 billion for developing e-commerce. According to the survey conducted by Nielsen Company (2007), there are 70% of internet users in Malaysia purchased online at some point in past. So there are many potential opportunities in e-commerce nowadays. Internet and electronic communication enables companies exchange or transfer their information to the other part of the worlds without boundaries. E-commerce also provides a new distribution channel for businesses to deliver their products or services to customers more efficiency and fast. Meanwhile, companies can connect their customers worldwide in real time. It can establish long term relationship with their customers. Since there are many advantages in adopting e-commerce, yet, not all businesses can successfully fully applied e-commerce especially insurance industry. Insurance industry has been lagging behind in the adoption of e-commerce. There are some barriers on adoption of e-commerce in insurance industry. All the business sectors included financial services sectors have been revolved to new e-commerce era because of the domino effect of globalization and liberalization around the world since 1990s (Piercy, 1999). New entrants of e-retailers of financial services sectors lead to intense competition among financial services providers. There is a need to improve service quality of their service in order to survive in the global market place. Yet, consumers are less likely to purchase online than expected in despite of the huge investments in online banking (Sarel Marmorstein, 2003; Wang, 2003). Better understanding of factors that affect customers acceptance on using internet banking is prerequisite of obtaining success in conducting e-commerce. However, lack of research on perception of consumers toward e-insurance in Malaysia. Another important issue is consumers feel unreliable towards security and privacy of e-commerce website (Jà ¤rvinen, 2001). Insurance policy requires exchanges of huge amounts information between the parties. Electronic exchange data or information that needed in insurance policy is an ideal way because Internet enables transfer data over worldwide. Yet the only concern is the private confidential of the data when it is being transfer through internet or any other electronic method. Because of the anonymous nature in internet, insured unable to ensure the data is transferred to the right person. In electronic environment, there is no guarantee of the data or information that being transferred is sealed and did not review by others. In addition, electronic exchange data can cause security problems like customer database may be hacked by someone who has negative intention. Furthermore, electronic documents without physical signatures are easily being pirated. According to Forrester r esearch 2001, the main reason (59%) of young consumers not purchase online is concern about the use of credit cards online and the second reason (47%) is concern about the privacy of the data they sent out to website. Besides, about 75% of US consumers of the Boston Consulting Groups survey are concerned about the degree of security and privacy provided in electronic environment (Goldman, 2001). There is a need for insurance companies to solve this problem by review other banks in gaining consumers trust towards online services (Mattila, 2003). In Malaysia, government had encouraged the development of E-insurance since January 2005. Persatuan Insurans Am Malaysia (PIAM) released the news of motorists will be the main beneficiary of the JPJs e-Insurance Project with effect from 1st January 2005. On 5th October 2004, Minister of Transport was launched an IT-based service with the full support of the JPJ, general insurers and takaful operators. The e-Insurance enables insurance companies to enter their policyholders motor insurance details and transmit them electronically to JPJs computer database for processing. With full implementation of e-Insurance, it minimizes the problems like long queues at the JPJ counters, shortening waiting times at the JPJ counters, reducing the need for repetitive capture of data will also ensure accuracy and consistency of data in JPJs database and eliminating physical motor cover notes will help resolve the problems of forged cover notes as well as reduce document inventory (PIAM, 2005). E-insur ance has brought to us many benefits but it still uncommon in Malaysia. E-commerce has brought a lot of questions. Is insurance industry suitable to apply e-commerce? How E-insurance ensured security and privacy of insureds information and data? What are the expectations of generation Y towards future E-insurance? How generation Y perceived adoption of E-insurance? Is adoption e-commerce an advantage or disadvantage for insurance industry? This study wants to lift up the veil of E-insurance. 1.3 Research objective The general objective of my study is to investigate the perception of generation Y towards E-insurance. The other objectives are: 1.) To study awareness and expectation of generation Y towards E-insurance. From this study, we want to know the high education generation Y perceived E-insurance. E-insurance is important for insurance industry in step out the first step of pursuing low cost customer services. Generation Y are their priority target of E-insurances product because generation Y have much of knowledge in computer. Generation Y treated as the future talented human capital of a country. They are high education and expertise in using computer. Therefore, their expectations and future requirements about E-insurance are important success factors of insurance industry. 2.) To examine the adoption of e-insurance in Malaysia E-insurance has not fully implemented in Malaysia. It is crucial to examine the current situation of adoption on e-insurance in Malaysia. 3.) To investigate the factors that can influence the perception of generation Y towards E-insurance and the adoption of e-insurance To establish long term relationship with customers, it is critical to investigate all the possible factors that may affect the views of the potential customers towards E-insurance. A good service is able to satisfy all the customers need. 1.4 Significance of study Insurance is essential for everyone. It provides a sense of security and peace of mind to us. It also provides financial stability to individual and businesses if insured risk occurs such as flooding, fires, accident or ill health. Insurance is a major component of financial sector. Nowadays, the adoption of e-commerce in financial sector has become obvious. Yet, the insurance sectors are lagging behind. This is mainly due to the complicated transaction involved in insurance industry. This study is aim to investigate the perception and expectation on generation Y on electronic insurance services as well as their willingness to accept E-insurance. Insurance industry in Malaysia have not fully implement e-insurance yet. Most of the consumers feel uncertainty towards this new e-commerce and some even do not aware about this. We are able to know the degree of awareness of generation Y towards e-insurance from the research. Generation Y are potential customers for e-insurance, their awareness of e-insurance is important to the development on insurance industry. According to previous research, it also showed that younger and high educated males with high level of income have higher probability to use internet banking services (Devlin Yeung, 2003). E-insurance also can be categorised as one kind of internet banking services, so perception of younger internet users towards e-insurance is important. The effect of liberalization and globalization around the world influenced the business sectors in Malaysia significantly. Liberalization allowed business transactions can be conducted cross over the boundaries of countries freely. E-commerce should be developed in Malaysia in order to gain the global competitiveness. Compared to other developing countries, Malaysia is lagging behind. In order to compete with other countries, Malaysia government need to support organization in adapting the changes in term of technological. E-commerce provides a new distribution channel for products and services which able to help companies deliver their products and services to customers efficiently all around the world. Although e-commerce provides many competitive advantages for business sector, however, insurance industry in Malaysia still have not implement the electronic insurance completely. It is necessary for government to generate effective strategy for establishing e-insurance in Malaysia. The antecedent of effective strategy is to obtain a clear understanding of perception of customer towards e-insurance. This study benefits government in term of more understand the customers need towards e-insurance, so government and business sector can complement with each other for establishing e-insurance in Malaysia successfully. Service itself is considered as interactive process whereby customers involved in the production process. Insurance is one kind of this service. Since insurance is an interactive process, customers viewpoint on the new electronic insurance must be paid with full attention. This study focuses on generation Ys response on the development of new electronic insurance because most internet users are generation Y now. With the generation Ys future wishes for electronic insurance, a user friendly and suitable E-insurance concept can be developed. This study also benefits insurance companies in developing the electronic insurance service which can satisfy customers need. A well-developed e-insurance service can meet customers requirement and increase their satisfaction. The speed of adoption on e-insurance in Malaysia will be improved. Society also benefited from the study because adoption in e-insurance enables them to access the insurance services through internet whenever and wherever they are. The success of establish e-insurance in Malaysia will bring many advantages to customers. E-insurance provides longer operation time, convenience, less transaction cost needed, and less processing time to customers. E-service has changed the way of people organize their lives. It enables people to make comparisons among the products or services through internet. The study also examines the customers concern towards security and privacy of e-insurance. Hence, after completed the study, the security and privacy of e-insurance systems can be enhanced according to the concern of society. This study investigate the relationship between generation Y and E-insurance and their expectation and perception on E-insurance in order to better establish a new era electronic insurance and to maintain long term relationship with customers. 1.5 Organization of study In chapter 1, the research begins with brief introduction to the topic â€Å"perception and expectation of generation Y towards E-insurance†. In the introduction, it briefly explained the term of e-insurance and generation Y and the relationship between them. After we have some basic ideas about the topic, problem statements of the study developed. The issues of e-insurance were addressed in the study. Objectives of the study are stated down and followed by explaining significant of study. Chapter 2: Literature review 2.1 Services and Goods Goods can be defined as physical products that being produced and sold to the market (Winsor, Sheth Manolis, 2004). In addition, goods also considered as something physical and tangible in nature that customers can feel, smell, taste or hear it prior purchase or make consumption (Rathmell, 1966; Shostack, 1977; Zeithaml, 1985). On the other hands, services are totally opposite to the characteristics of goods. Services normally are classified under intangible characteristics which cannot be touched, smelled, tasted, hear by customer before purchase and make consumption. Furthermore, services also can be classified as a product, a process involves of many activities and can be produced and consumed at the same time, and to some extent customers may participate in the service production process (Grà ¶nroos, 2000). One of the researchers defines service as something can be bought and sold but which you cannot drop on your feet, this definition points out intangible characteristics of service (Gummesson, 1987). Besides that, service also defines as an act that offered by other party (Lovelock and Wright, 2002). There are four main attributes that help in distinguishing between goods and services namely, tangible or intangible (the degree of physical feature), separability or inseparability (the degree of linkage between the product or service and providers and customers), variability or invariability (the degree consistency of the products or services attributes) and perishability (the degree of capacity for being stocked) (Berry, 1980; Fisk, 1993; Gronroos, 1998; Kotler, 1994; Shostack, 1977; Zeithaml, 1985). From the four main attributes, it clearly states that the things that classified as services only when it fulfilled the four main characteristics of intangibility, inseparability, variability and perishability. For example, hair cut service, it does not provide any tangible product to its customer but only intangible service, throughout the hair cut service, it need participation of customer, the hair cut services are inconsistency in quality and it cannot be stocked. Furthermore, among the four attributes of differentiating the goods and services, the intangible characteristic is the best definitive for services (Bateson, 1977; Bebko, 2000; Berry, 1980; Levitt, 1981; McDougall Snetsinger, 1990). Various definitions that used to define services stated above are prefers to include the intangibility features into the statements. Hence, intangibility characteristic of service is the most representative attribute for services in order to distinguish goods and services. However, the tangibility feature is becoming less useful and less definitive for distinguishing between goods and services in digital environment (Rust Oliver, 1999). This is due to digitized goods are consists of both tangible and intangible characteristics. For examples, online purchase DVD is intangible in nature because customers cannot touch or feel the product before the actual tangible product received. The development of electronic environment has blurred the clear distinctio n between goods and services by using intangibility attributes. In order to fill up the inadequacy of tangibility criterion, another framework which used four types of utilities to differentiate goods and services has been developed (Winsor, Sheth Manolis, 2004). The four types of utilities are time, place, form and possession. All retailers will provide time and place utilities to customers, the only differences can be make between goods and services is in term of form and possession (Rathmell, 1966; Hsieh Chu, 1992). Physical goods will only contributing little form utility for customers compared to service whereas the permanent of transfer of possession utility only completed when customers are purchased physical products rather than services (Clemes, 2000). According to this framework, insurance is classified as hybrid retailing or a mixture of goods and services because it provides a moderate degree of form and possession utilities. 2.2 E-service The new era of e-service has begun since the development of internet being introduced in 1994 (Ahonen, 2004). There are three phases of internet according to the previous research (Kalakota Robinson, 2001). The beginning phase (1994-1997) is home pages and website of every company available. The following phase (1997-2000) is taking part into e-commerce in business. The last phase (2000-) which means the current situation is to satisfy online consumers and try to take advantages of internet. However, the development of e-service of our country is lagging behind when compared to other foreign country. Although many researchers have defined e-service before, but there is no an exceptional definition for e-service. E-service can be known as a service that conducts through electronic method such as internet (Rust Kannan, 2002). There is a difference between technology based service and e-service concept, the latter concept need to be carried out through online method whereas technology based services can be an ATM service. Both of the concepts are benefited from development of information technology (Jà ¤rvinen Lehtinen, 2003). In an electronic environment, the service concept is important because the nature of the services is abstract and where the relationships between partners and customers are virtual (Grà ¶nroos, 2000). Since electronic insurance services are perceived as complex and difficult to use, therefore clear and well defined service concept should be emphasized (Jà ¤rvinen 2001; Ahonen Salonen 2005). There are four chosen characteristics, namely, intangibility, process nature, inseparability and interaction that used to test some selected e-services in previous research (Jà ¤rvinen Lehtinen, 2004). All e-services are intangibility in nature and remain intangibility if the consumers only search for information of particular product or service through online. There are only few services consists purely intangible characteristic. For example, previous studies stated that even financial services also aided tangible by their documents like loan agreement (Jà ¤rvinen Lehtinen, 2004). The characteristics of process nature also universal for all studied e-services which means that the customers need to be follow the specific procedures in order to get the services. Inseparability and interaction characteristics are deviated among different e-services (Jà ¤rvinen Lehtinen, 2004). Some characteristics of services in electronic environment have to be considered in order to shift the s ervice concept to (Ahonen, 2004). For e-service, it seldom needs personal interaction when compared to telephone based services (Lovelock, 2002). However, the argument is human factor plays an important role in service recovery when technical problems happened (Jà ¤rvinen Lehtinen, 2004). In addition, E-services can bring considerable profit for companies if they able to manage the e-service effectively. However, not all the products and services are suitable for online trading because internet as a marketing channel only able to realistically fulfill two out of five senses of customers which are sight and sound. Therefore, only products and services that fully utilize the two senses are suitable to sell online for example, CD (Stern, 1995). According to other researcher, Peterson (1997) suggested that the suitability of the products and services to be sold online based on three dimensions: (1) cost outlay and frequency of purchase; (2) value proposition; (3) degree of differentiation Based on the study, products and services that have low cost, high frequency in purchase, intangible value proposition and high degree of differentiation are more suitable to market through internet (Phau Poon, 2000). Is insurance suitable to sell online? Regarding to the three dimensions above, insurance has fulfilled two dimensions which are intangible value proposition and high degree of differentiation because insurance is considered as a customization service. Hence, insurance is considered suitable for marketing through internet. For successfully implement e-service, it not only depends of the suitability of the products and services but also depends on the customers perception towards e-service. Based on previous studies, the overall satisfaction of customer towards e-service can be improved through various factors which included convenience, saving time and money, ease of use, financial security and web site designed to be fun (Szymanski Hise, 2000; Meuter, 2000). Customers satisfaction is important determinant of successful e-service (Parasuraman Grewal, 2000). In order to successfully implement e-insurance in Malaysia, those factors also included in this study to determine adoption of e-insurance. 2.3 Insurance Insurance is defined as the evenhanded transfer of the risk of a potential loss, from one entity to another, in exchange for a premium and duty of care (Wikipedia, 2005). Insurer is the company that sells the insurance, and the insured is the party who buy the insurance. Insurance rate is the amount charged for a certain value of insurance. Insurance sold to consumers directly is known as direct insurance (Skipper, 1998). Meanwhile, direct insurance also can be defined as a service with particular terms and conditions agreed in an insurance policy. On the other hands, one of the researchers stated that part of the insurance service is to maintain a long term relationship between customers and insurance company rather than only holding legal responsibility with customers (Jà ¤rvinen, 1996). Intangibility, inseparability, perishability, heterogeneity and lack of ownership are characteristics of services (Cowell 1988; Zeithaml Bitner 1996). However, all these characteristics do not followed by insurance service. The tangibility of insurance services achieves through a physical paper of an insurance policy including a promise to pay compensation if a certain unforeseen event takes place. The insurance policy symbolizes the only evidence of that promise until losses occur (Majaro, 1982; 1985). In fact, no policyholder would prefer to have any losses, and thus we can conclude that consumers only purchase merely security or protection for their safety instead of compensation of losses. So, as a result it is in force to cause consumers consume insurance whole period that is a continuous consumption, but production is cross-sectional and dependent of the interaction of the consumer and the insurance company. Therefore, insurance service only partially fulfilled the characteris tic of inseparability. One of the unique natures of each service is heterogeneity on its part. There are various alternatives of insurance for consumers to choose which insurance policy is suitable for them but the terms and cover of most of the insurance is standardized (Jà ¤rvinen, 1998). In case of e-insurance, the heterogeneity part of the personal service forms the only unique part of insurance is eliminated. The back-office resources in insurance that used to balance the capacity can avoid perishability. As a result, large part of activities in E-insurance can be carried out without consumers existence and participation. Lastly, as regards to ownership, insurance holders actually own the partial ownership of the service because they reserve the right for claims settlements that will be paid from the reserves in the balance sheet of an insurance company by paying premium (Jà ¤rvinen, 2000). This means that insured consumers own their part of reserves, and that principle is based in Insurance Act. Co nsequently, we can conclude that the insurance service is quite specific from other services because it only fulfilled partially of the common service characteristics. One of the financial services is insurance, it seems to have different user frequency when compared to other bank services (Jà ¤rvinen, 2003). Specifically, consumers may have bank transactions weekly, but in case of insurance issues, such as risk analysis and insurance cover or claims applications, occur quite infrequently and with low frequency (Ahjos, 1999). Hence, there may be only one occurrence within few years, and that is premium payment. Thus, insurance deviates from bank services and in the case of Internet which means that consumers may never get used to e-insurance, because their actions are needed too rarely. Low frequency and infrequency may also be reasons that obstruct the consumers engagement, which may become the crucial point in developing e-insurance. Generally, insurance services is quite different from others banking services. Insurance companies have to take care of every step in implementing e-insurance successfully. This study is tries to unveil the mystery of insurance services in Malaysia. 2.4 Insurance in Malaysia The beginning of insurance launched in Malaysia can be traced to 18th and 19th centuries which transformed from the agency houses that acted as representative of insurance companies in United Kingdom. Hence, the insurance industry has been strongly influenced by the British insurance system and continued until today. At that time, almost all the insurance companies were established by foreign insurer. Domestic insurance companies were only being introduced in Malaysia after Independence Day. However, domestic insurance companies have faced failure and wound up due to inadequate technical and sound operation in the early 1960. To solve this problem, Malaysian government enacted insurance Act 1963 to regulate insurance industry which functioning under Ministry of Finance. The Insurance Act 1996 has replaced the Insurance Act 1963 on 1st January 1997 in order to supervise and regulate insurance industry more effectively (Ahmad Sungip, 2008). Basically, there are three types of insurance industry in Malaysia which included life insurance industry, general insurance industry and Takaful insurance industry (Aini Tee, 2003). Life insurance is insurance policy that covers variety of contingencies event occurred on human life whereas general insurance is all types of insurance policy except for life insurance. On the other hands, Takaful is insurance which based on Islamic principles (EconomicWatch, 2009). There are five main statutory insurance associations in Malaysia namely, Persatuan Insuran Am Malaysia (PIAM), Life Insurance Association of Malaysia (LIAM), Persatuan Insuran Kebangsaan Malaysia (NIAM), Insurance Brokers Association of Malaysia (IBAM) and Association of Malaysian Loss Adjuster (AMLA) (PIAM, 2009). Each statutory insurance association has different function. PIAM is an association of general (non-life) insurers, LIAM is an association of life insurers, NIAM is represents locally incorporated insurer with m ore than 51% Malaysian equity, IBAM is an association of insurance brokers, AMLA is an association of insurance brokers. Insurance companies in Malaysia were only started to conduct e-commerce in 1999 which was much slower when compared to other developed countries. During that period, Bank Negara Malaysia has allowed some of the insurance companies to establish Malaysia first interactive insurance website which enabled insured can make online payment and renewal of motor vehicles insurance policy. Till April 2000, Bank Negara Malaysia allowed a full range of life, general an

Inconsistent Terminology for Emerging Technologies :: Exploratory Essays Research Papers

Inconsistent Terminology for Emerging Technologies Emerging technologies affect not only the computing world but other worlds as well. In the past ten years the English language has expanded to include new terms such as blog and instant messaging. Unfortunately, not all new words are reviewed and approved by a central source and often common terminology fragments into different styles and usage. Perhaps the word web site best typifies this behavior. Although a web site is hardly new in terms of technology, publications have been rife with inconsistent usage. However, of the various permutations, the etymology of web site is the most practical. Most traditional sources such as the American Psychological Association Style Guide seem to skirt the issue altogether with a list that includes Web and e-mail, but not site. Or, when electronic sources are cited, they are listed as being found â€Å"on-line† (APA). While traditional style guides have often outlined best practices for grammar and terminology, only a few published style guides are dedicated to the forum of the World Wide Web. One of the oldest web-dedicated style guides, the Yale Style Guide, makes no direct reference to the usage of the term web site, but consistently refers to it as Web site. Additionally, Gerry McGovern’s Web Content Style Guide adheres to the one-word usage of website. However, the same book curiously advises two different usages of the word web. The use of a capitalized Web is recommended when the word is used on its own to refer to the World Wide Web (example; The Web has grown immensely in popularity.). The second use is a lowercase web, when the word is used as an adjective, such as web users (McGovern 2002). A brief look at online web dictionaries and terminology guides may indicate that Web site is the most popular term. Webopaedia uses the Web site as an entry, as well as NetLingo. But when turning to the experts of the Web, such as Jakob Nielsen, one will discover that Nielsen voices stong opinions about web usability standards but goes against the grain in his use of the term website. In 1997, Wired magazine launched a short-lived companion site to its published handbook WiredStyle with the following explanation for its use of Web site: "Web" is a proper noun, and so deserves its initial cap. When using "Web" as a modifier, we keep the cap and strongly resist the urge to close "Web" up with other nouns.

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Although there are many great presidents of these United States, Harry Truman has his own life story. Harry S Truman was born May 8, 1884 in Lamar, Missouri. His parents were John and Martha Young Truman. His father, John, was a farmer and live stalk trader. Martha, his mother was a homemaker. Harry was the oldest in his family of three children. He had a sister named Mary Jane, and a brother named John Vivian. Harry was taught honesty, hard work, and family love at a young age. (3) Truman grew up on a farm in Harrisonville, Missouri and later moved to Independence, Missouri. (3) From a young age, Truman enjoyed reading about history and biography and was very good at it. Truman went to the public school in Independence. He didn’t do any sports in high school because from a young age he was always afraid that he would break his glasses. Sense he didn’t do sports he was picked on by some of the kids, they also made fun of him because he had glasses. Although he did well in high school he did not attend college after graduation. The reason for this was because college was expensive and his parents could not afford that. Truman started working on a railroad and as a bank clerk. When he turned 22 he moved back to the country and started working for the family farm for the next 11 years. 2 Truman joined the army in 1918 and went to France to fight in World War I. While there, Truman became an officer and led his men with good inspiration. After fighting in the war and returning home, Truman married a woman he knew from a young age named Elisabeth Wallace, nicknamed Bess. They were married on June 28 1919. After marriage, they wanted to start a family so they had one daughter named Mary Margaret. After he married the women he loved,... ...ested him greatly. Truman was a loyal man to his wife and his country. This makes him a good man in my book. He had to deal with a lot of war and depression in the years that he was president and that wouldn’t be easy for anyone. He also had to deal with the country advancing and a lot of more children being born. Some presidents didn’t have to deal with hard things like coming into office after someone else died, but that was his duty and he knew he could do it. His wife was very supportive of all of his decisions. When becoming a president you have a lot of shoes to fill, a lot of people to worry about, and a lot of things to look over. It takes a strong man or woman to do so. Even through the 11 hard times Truman didn’t give up, he won the re-election even when no one thought he was going to. It takes dedication do so these things and Truman had a lot of that.

Case Analysis: Ford Corporation

Case Analysis: Ford Motor Company Global Strategic Management March 4, 2013 Ford Motor Company: Organization Profile Ford Motor Company Staying â€Å"Ford Tough† Henry Ford established the auto company in June 16, 1903. An engineer by formation, Henry had a vision of making vehicles that would change society. He wanted to offer an affordable product to the public, one that his own workers could buy. His vision took him to model T in 1908, and to improve the manufacturing process with the conveyor belt at Ford’s Highland plant.The manufacturing capabilities kept on improving and in 1917 he built the Rouge plant that put the whole operation, from the raw material, to the final product, under the same roof. In 1915 Henry Ford’s son, Edsel Ford joined his father in the company. Edsel brought to the company the desire of making a product not only functional, but stylish and beautiful. Ford became entirely family owned in 1919 when Henry, his wife Clara, and Edsel boug ht the outstanding shares for $105,820,894 (Chapman, pp. 128) . The company would hold to this status until 1956 when the company would allow outsiders to buy shares.For many years the image of the company was the same as its leadership. Henry Ford passed the presidency to Edsel Ford in 1919. Henry Ford reassumed the leadership after the death of Edsel in 1943. After Henry Ford resigned, Henry Ford II assumed the presidency. The company inherited by Henry Ford II was not the same. Ford had fallen behind General Motor (GM) and Chrysler. Henry Ford II knew he had to regain terrain, so he contracted the Whiz Kids (a group of former US Army Air Force officers), and created a â€Å"sophisticated management system including accounting and financial controls† (Chapman, pp. 28). With the finance side in check, Ford gained increased its position, and became the number 2 car company in 1950. Ford products were not fuel efficient, and when the gas prices rose in the 70s because of the O PEC embargo, Ford lost many consumers. The company responded by closing plants and cutting jobs. After the storm, the sun came out in the late 80s with the launch of Ford Taurus and Mercury Ford was on the top of the game once again. The desire to diversify made Ford buy other brands and include it in its family such as: Jaguar, Aston Martin, Land Rover and Volvo.Bill Ford assumed the presidency of the company in 2001. It was the first time in 20 years that the head of the company was a member of the Ford family. Bill Ford drove the company through one of the worst times in history for the company: right after the extensive (and expensive) Firestone tires recall, and the terrorist attacks of September 11, 2001. Bill Ford went to ups and downs during his presidency. He saw sales improving slowly from 2001 to 2006, but the increasing competition from foreign brands such as Toyota, Nissan and Honda made him realize that he needed help taking the company to the next level.Alan Mulally b ecame the new CEO in 2006. He was a new face in the auto industry, coming from Boeing Corporation instead from inside Ford or from another auto company. Mulally â€Å"demonstrated leadership skills Henry Ford had established many years ago. † Mulally brought to the company new energy, and a brave new plan. His most risky decision proved to pay off in the end. He decided to raise money by mortgaging almost all of Ford’s assets including the brand. His audacity put Ford as the most trustworthy American company. The money raised by Mulally helped keep Ford out of the government bailout of 2009.Ford Motor Company: The Problem(s) Ford has been a pioneer in the auto industry but it still faces a lot of problems to make it the number one in the industry. The increasing competition from other car companies to creatively and efficiently attract and retain customers made it difficult to gain the number one position. The economic crisis also made it hard to sell new vehicles. The quality of Ford vehicles have also gone down compared to what it was before. The slow reaction to change in consumer taste made Ford lag behind its main competitors.It was also late in expanding in international market and opportunities were lost to other brands. Ford Motor Company: SWOT Analysis Strengths One of Ford’s biggest strengths is its leadership. Since Henry Ford founded the company, the leadership has been proven to help the company throughout difficult times. Every leader brought to the company a new idea. Henry Ford wanted the company to produce an affordable product. His successor, Edsel showed that innovation is always necessary in this industry. Edsel wanted stylish and beautiful vehicles to carry the Ford brand. Henry Ford II with he help of the Whiz Kids developed a â€Å"sophisticated management system† what helped the company after World War II. He also â€Å"revitalized Ford with modern engineering, manufacturing, assembly, and distribution facil ities in the US and 22 foreign countries† (Chapman, pp. 128). The strong and visionary leadership style of Henry Ford was shared by many other leaders of Ford. The new generation, Bill Ford and Alan Mulally also presented the traits of a Ford leader. Bill by navigating Ford throughout harsh times, and for seeing that the company needed a change, a fresh start.He then passed the leadership of the company to Alan Mulally who proved to be exactly what the company needed. Mulally discovered that Ford lacked â€Å"global synergy,† he was surprised by the way that Ford was operating its brands. He saw that the company did not have central control, it took him a while to find out what was really happening inside the company. He also made really tough financial decisions, and reorganized the amount of brands and models offered by Ford. â€Å"With his leadership and conviction, Ford Motor Company stood apart from its competitors by standing on its two feet† (Chapman, pp. 33). Ford’s reputation is also an incredible strength for the company. Ford is seen as a family company. Henry Ford wants the employees to be able to buy cars, increased their wages, and was interested in sharing a piece of his family with others. Weaknesses Ford has proven to be slow to respond to changes in the environment and consumer tastes. They felt that they â€Å"got it,† and felt comfortable with it. Since the beginning of Ford, with a delay to offer cars in other colors than black, they experience a tardiness to respond to changes.One example was the excessive attention to SUVs and other gas inefficient cars when the gas prices spiked. When consumers were looking for alternatives to the gas drinking vehicles, Ford was fully producing SUV’s. Although SUV’s are Ford bestselling product, the fact that they were slow to make them more efficient or give costumers other styles to choose from, made Ford to lose market share to other automakers. Ford al so lost terrain when they did not address earlier the ecofriendly trend. Toyota had the Prius which did not have much of a competition until recently.Currently, Ford has â€Å"12 vehicles with best in class fuel economy and 4 models with at least 40 mpg† (Chapman, pp. 137), and is developing plug-in models that use a combination of electricity and gasoline that will compete against the Chevrolet Volt. Opportunities Ford has the opportunity to expand its presence and capture market share in India and China. It aims to increase its revenues from international sales from 20 percent to 50 percent. The expanding market of the two countries allows Ford to focus on small, light and fuel efficient cars that are needed in the market.Ford has also been slow to respond to demands for small hybrid or fuel efficient cars in the United States. There is also an opportunity to increase standardization of the platforms used in world-wide production of vehicles. If this happens the cost of pro duction would significantly lower and it would be easier to introduce new cars into new markets without building new plants. Ford can also further trim down the number of models out in the market and focus on cars they are widely known for such as light trucks and expand its model for smaller and fuel efficient cars.To target the higher end market, it should continue to build its Lincoln brand as a better alternative in the US and once established, export that brand to new markets overseas. Production from union controlled plants could also be transferred to non-union plants that can give Ford plants a competitive edge or be at par with other auto companies in compensation for workers. Ford can also consolidate more dealership to become more competitive and give them incentives to attract more customers thru financing and offering excellent customer service. ThreatsThe auto industry is very competitive and technology driven industry. Ford has to constantly monitor its competitors to know how it will make its own decision. Companies will outbid one another in attracting new customers by giving them a lot of rebates, incentives and attractive financing. The technology for clean, fuel-efficient cars and alternate sources of fuel is also changing and without proper funding for research Ford could be left behind and lose in this expanding market. Any increase in price of raw materials could also increase production cost for Ford and make their vehicles more expensive.Demands of union workers also affect the competitiveness of Ford. They are currently paying higher compensation and benefits compared to the rest of auto industry. Changing consumer tastes also makes it difficult for Ford to quickly address and create cars that the market needs. Any decline in the US economy would also greatly affect the revenues of Ford. Most of the revenues of Ford comes from the US market and if the US economy goes into another recession it would decrease consumer spending and make it difficult to survive without government help. Ford Motor Company: Five Forces Threats of Substitute Products – High in Urban Areas, Low in Suburban Areas * With the increase of gas prices and traffic congestion consumers are now looking for alternate ways to commute between work and home. Consumers are increasingly being aware of their â€Å"carbon footprint† and are looking for clean and energy efficient alternatives to commute. In cities, the availability of public transportation such as buses, subways and light rail systems gives commuters flexibility. Car-sharing options such as Zipcar are now also available in cities and have become popular. Rivalry Among Competing Firms – High * Competition in the auto industry is very high. Different companies compete aggressively in increasing their market share by giving incentives to customers. It is also important for companies to satisfy the needs and tastes of consumers. Companies also try to run an efficient sup ply chain to limit the cost of producing and increasing profit margins. * Threats of New Entrants – Low * The threat of new entrants in the local auto industry is low. The auto industry is very capital and labor intensive and it takes time for companies to establish their operations.The current companies have established their presence and market share but competition from potential, new and growing car companies in big markets such as China and India is inevitable. * Bargaining Power of Suppliers – Low * The auto industry sources its raw materials from global suppliers. The suppliers market is also a competitive industry. Bulk of their sales come from the auto industry and companies have established relationships to give them access to supplies and new technologies. The relationship of auto ompanies and suppliers are intertwined given that as auto companies increase production, supplier companies increase revenues. * Bargaining Power of Buyers – High * Consumer s now have more choices that gives them a higher bargaining power. The economy is also improving and giving them more buying power. Unlike before where manufacturers dictate what the dealers will push to the consumers, consumers now make the demand for manufacturers to make fuel-efficient and environment friendly cars. Consumers are also well informed and by being well informed they can ask for more incentives to dealers and car manufacturers.Ford Motor Company: Recommendations Under the leadership of Mulally Ford has significantly made changes to improve the position of the company. We recommend that Ford increase funding on research for fuel efficient cars, alternate sources of energy for smaller cars that the market demands and will create sustainability in its vehicles. Ford should also maintain or increase the quality of its vehicles by standardizing its platforms and improving its technology to detect any safety issues with its vehicles to avoid costly recalls that not only is expensive but tarnishes the image of the company.The economic crisis has made it difficult for other car companies not to be bailed out but Ford was able to maintain its independence by using its assets and enforcing better control in its finances. Ford can continue to be competitive by maintaining or lowering its operating costs. Ford has been known in its proficiency in having a tight supply chain were it can control the costs of production. Ford should be quick to adapt in changing consumer tastes.It should not be content with making products that they are known for and lose market share in new vehicles that are small, clean and fuel efficient. It should also make its current models cleaner and more fuel efficient to maintain attractiveness to consumers. Ford has great potential in new markets such as China and India. The reputation it has built as a well know car manufacturer in the US can be used to tap new customers in international market. Ford has built by its strong leader s and will continue to thrive if more reforms are made.

Factors Influencing Customer Satisfaction

Course: Research Methodology (BT21603) Lecturer: Dr. Zakariya Belkhamza Name of Members| Matrix Numbers| Signatures| Rachael Ubu| BB11110489| | Nurul Hidayah Binti Ariff| BB11110460| | Annie Thien Li Len| BB11110055| | Nicole Chow Soo Yee| BB11110372| | Surianti Binti Abidin| BB11110579| | Khuzaimah Binti Mohd Nurung| BB11110242| | Jazmiah Jamaluddin| BB11110209| | Mazlinah Binti Majid| BB11110310| | Siti Munirah Bte Abd Malik| BB11160816| | Wang Qin| BB11170684| | 1. 0 Research Topic Factors that affect customer satisfaction in the hotel industry. 2. 0 Research BackgroundThe English word â€Å"hotel† derives from the French word hotel (coming from hote meaning host). It refers to a townhouse which is any building that is frequented by seeing visitors. A hotel is an establishment which provides lodging for a paid short term basis. Kotler (1996) defined customer satisfaction as â€Å"the level of a person’s felt state resulting from comparing a product’s perceive d performance or outcome in violation to his/her own expectations. † The importance of this study is to gain knowledge on customer satisfaction and the problems resulting in lack of customer satisfaction in the hotel industry.According to Alex Hisaka (2011), the importance of customer satisfaction can have an impact on your business and if you don’t start paying attention you’ll lose an opportunity to make a customer happy. Customer satisfaction with hotel properties has been identified as one of the factors leading to the success of a tourist destination (Shih, 1986; Yau and Chan, 1990; Stevens, 1992; Mok et al. , 1995). Research into customer satisfaction in the service industry has increased dramatically in recent years (Peterson and Wilson, 1992). Customer satisfaction has long been an rea of interest in academic research. Hunt (1975) considers satisfaction an evaluation on which the customer have experienced with the services is at least as good as it suppos ed to be. For demographic characteristic, nearly 46 percent of the respondents had stay at Medium- Tariff hotels, 42 percent at High-Tariff â€Å"B† hotels and 12 percent at High-Tariff â€Å"A† hotels. The finding clearly demonstrates that the services encounter or customer-employee interaction is a major determinant affecting travels’ perceptions in relation to service quality, resulting in their likelihood of returning to the same hotel. . 0 Customer Satisfaction Customer Satisfaction * Service Quality * Room Quality * Service Quality * Room Quality Research Framework 4. 1 Research Problem Hotel industries nowadays are facing one of the most important challenge is to provide and maintain customer satisfaction. Kandampully (2000) Service quality has become a factor important in the overall tourism experience and one which ultimately dictates the success of the tourism business. According to Lewis and Booms (1982), service quality is measure of how well the ser vice delivered matches customer’s expectations.A part from that, room qualities also becomes a factor that can influence customer satisfaction in the hotel industry. Room qualities are important considerations for travel in-lodging selection. It includes cleanliness of room, comfort of bed, and quality of in-room temperature control and quietness of room. (Knutson, 1988; Barsky and Labagh, 1992; McClearly and Weaver, 1992; Gilbert and Morris, 1995; Heung et al. , 1996). Positive relationship can make a higher commitment of customers and increase their rate of return.Long term relationship between customers and hotel is becoming more important as the positive correlation between overall satisfaction levels of visitors and their abilty to return to the same hotel. Since most previous research found out that most study on customer satisfaction in hotel industry focused in Hong Kong, United States and other European countries, where there’s a lack of Malaysian study focusi ng in Kota Kinabalu, Sabah. Therefore, this research will focus on customer satisfaction in hotel industry in Kota Kinabalu, Sabah. 4. 0 Research Objective 1.To investigate the relationship between service quality and customer satisfaction 2. To investigate the relationship between room quality and customer satisfaction References 1. Choi T. C and Chu. R, 2001, determinant of hotel guests’ satisfaction and repeat patronage in the Hong Kong hotels history. 2. K. s. (kayne) Chan, 1998, journal of hospitality and tourism research. Tutorial 1 Research Methodology 1) What research is all about? 2) Describe the characteristic of scientific method (What is scientific research? ) 3) What is problem statement? How to write a problem statement Answers 1.Research is about doing or making a study in a specific area of interest. According to Saunders, research is defined as something that people undertake in order to find things out in a systematic way, thereby increasing their knowledge. 2. Scientific research is the development of a theory that is then tested through a series of propositions. The characteristics of scientific research are that firstly, we would have to create a hypothesis about the relationship between two variables. Second characteristic is that by using the hypothesis, we would have to test it through a series of propositions.Thirdly, we would have to examine the logic of the hypothesis by comparing them with existing hypothesis relating to our hypothesis. Fourth, we would have to collect appropriate data to measure the variables. Fifth, if the results of the analysis are not consistent with the problems, the hypothesis is rejected and the theory is false. Lastly, if the results are consistent then the theory is true. 3. Problem statement is analyzing the problems related to the hypothesis. By asking the correct problem statements, we can ensure that we can relate the problems to the hypothesis. Factors Influencing Customer Satisfaction Course: Research Methodology (BT21603) Lecturer: Dr. Zakariya Belkhamza Name of Members| Matrix Numbers| Signatures| Rachael Ubu| BB11110489| | Nurul Hidayah Binti Ariff| BB11110460| | Annie Thien Li Len| BB11110055| | Nicole Chow Soo Yee| BB11110372| | Surianti Binti Abidin| BB11110579| | Khuzaimah Binti Mohd Nurung| BB11110242| | Jazmiah Jamaluddin| BB11110209| | Mazlinah Binti Majid| BB11110310| | Siti Munirah Bte Abd Malik| BB11160816| | Wang Qin| BB11170684| | 1. 0 Research Topic Factors that affect customer satisfaction in the hotel industry. 2. 0 Research BackgroundThe English word â€Å"hotel† derives from the French word hotel (coming from hote meaning host). It refers to a townhouse which is any building that is frequented by seeing visitors. A hotel is an establishment which provides lodging for a paid short term basis. Kotler (1996) defined customer satisfaction as â€Å"the level of a person’s felt state resulting from comparing a product’s perceive d performance or outcome in violation to his/her own expectations. † The importance of this study is to gain knowledge on customer satisfaction and the problems resulting in lack of customer satisfaction in the hotel industry.According to Alex Hisaka (2011), the importance of customer satisfaction can have an impact on your business and if you don’t start paying attention you’ll lose an opportunity to make a customer happy. Customer satisfaction with hotel properties has been identified as one of the factors leading to the success of a tourist destination (Shih, 1986; Yau and Chan, 1990; Stevens, 1992; Mok et al. , 1995). Research into customer satisfaction in the service industry has increased dramatically in recent years (Peterson and Wilson, 1992). Customer satisfaction has long been an rea of interest in academic research. Hunt (1975) considers satisfaction an evaluation on which the customer have experienced with the services is at least as good as it suppos ed to be. For demographic characteristic, nearly 46 percent of the respondents had stay at Medium- Tariff hotels, 42 percent at High-Tariff â€Å"B† hotels and 12 percent at High-Tariff â€Å"A† hotels. The finding clearly demonstrates that the services encounter or customer-employee interaction is a major determinant affecting travels’ perceptions in relation to service quality, resulting in their likelihood of returning to the same hotel. . 0 Customer Satisfaction Customer Satisfaction * Service Quality * Room Quality * Service Quality * Room Quality Research Framework 4. 1 Research Problem Hotel industries nowadays are facing one of the most important challenge is to provide and maintain customer satisfaction. Kandampully (2000) Service quality has become a factor important in the overall tourism experience and one which ultimately dictates the success of the tourism business. According to Lewis and Booms (1982), service quality is measure of how well the ser vice delivered matches customer’s expectations.A part from that, room qualities also becomes a factor that can influence customer satisfaction in the hotel industry. Room qualities are important considerations for travel in-lodging selection. It includes cleanliness of room, comfort of bed, and quality of in-room temperature control and quietness of room. (Knutson, 1988; Barsky and Labagh, 1992; McClearly and Weaver, 1992; Gilbert and Morris, 1995; Heung et al. , 1996). Positive relationship can make a higher commitment of customers and increase their rate of return.Long term relationship between customers and hotel is becoming more important as the positive correlation between overall satisfaction levels of visitors and their abilty to return to the same hotel. Since most previous research found out that most study on customer satisfaction in hotel industry focused in Hong Kong, United States and other European countries, where there’s a lack of Malaysian study focusi ng in Kota Kinabalu, Sabah. Therefore, this research will focus on customer satisfaction in hotel industry in Kota Kinabalu, Sabah. 4. 0 Research Objective 1.To investigate the relationship between service quality and customer satisfaction 2. To investigate the relationship between room quality and customer satisfaction References 1. Choi T. C and Chu. R, 2001, determinant of hotel guests’ satisfaction and repeat patronage in the Hong Kong hotels history. 2. K. s. (kayne) Chan, 1998, journal of hospitality and tourism research. Tutorial 1 Research Methodology 1) What research is all about? 2) Describe the characteristic of scientific method (What is scientific research? ) 3) What is problem statement? How to write a problem statement Answers 1.Research is about doing or making a study in a specific area of interest. According to Saunders, research is defined as something that people undertake in order to find things out in a systematic way, thereby increasing their knowledge. 2. Scientific research is the development of a theory that is then tested through a series of propositions. The characteristics of scientific research are that firstly, we would have to create a hypothesis about the relationship between two variables. Second characteristic is that by using the hypothesis, we would have to test it through a series of propositions.Thirdly, we would have to examine the logic of the hypothesis by comparing them with existing hypothesis relating to our hypothesis. Fourth, we would have to collect appropriate data to measure the variables. Fifth, if the results of the analysis are not consistent with the problems, the hypothesis is rejected and the theory is false. Lastly, if the results are consistent then the theory is true. 3. Problem statement is analyzing the problems related to the hypothesis. By asking the correct problem statements, we can ensure that we can relate the problems to the hypothesis.