Sincerly Samski: Scattered Randomness

Federal Grants

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Distinction and Purpose

Grants and procurement contracts are two of the more common legal instruments used by the United States Government to formally express a legally enforceable act, process, contractual duty, obligation, or right between parties. The Federal Grant and Cooperative Agreement Act[1] of 1977 implemented legislation restricting the term “contract” to acquisition relationships and required the use of alternative instruments, such as grants, to implement assistance relationships. Prior to this act, Federal agencies frequently used procurement contracts and grants interchangeably and without consistency to relationship type.

Federal grants are not governed by the Federal Acquisition Regulation (FAR) the way that procurement contracts are. The principal purpose of a federal procurement contract is to acquire property or services for the direct benefit or use of the United States Government[2], and can be done by purchase, lease, or barter. The purpose of a grant agreement is to transfer a thing of value to a party in order to carry out a public purpose of support or stimulation[3]. Federal grants are governed by regulations in Title 2 of the Code of Federal Regulations (CFR) part 215. Because the purpose of federal procurement contracts and grants differ, the instruments also have different requirements and consequences.

Authority

Federal agencies have an inherent, constitutional authority to issue procurement contracts[4]. Assistance awards, however, cannot be executed without identifying appropriate statutory authority for a particular program. Statutes, or laws passed by Congress, authorize Federal agencies to use an assistance instrument. Congress gives statutory authority to Federal agencies through broad legislation or program-specific statutes. By passing these laws, Congress is also authorizing the award of financial assistance with contingencies on how the funds can be spent. Absent statutory authority, assistance instruments may not be used. Assistance affecting provisions are found in appropriations law, authorization laws, and crosscutting public policy statutes. Provisions of the Office of Management and Budget (OMB) Circulars are applicable to all Federal agencies. OMB established Title 2 of the CFR for grants and other financial assistance and non-procurement agreements as part of the efforts to implement the Federal Financial Assistance Management Improvement Act of 1999[5]. The legal availability of assistance funds is contingent upon funds being obligated and expended for their appropriated purpose and no other[6], expenses being properly incurred during the period of availability[7], and funding amount not exceeding funds appropriated[8].

Synopsis

Congress annually appropriates funding for grant programs which are listed in the Catalog of Domestic Federal Assistance and the Federal Registrar. In accordance with the Federal Funding Accountability and Transparency Act of 2006, each grant announcement is required to include sponsoring government department, program title, total budget, application deadline, administrative contact and program summary.

Competition Requirements

The use of competition in awarding grants is encouraged[9] and grant officers shall use merit-based, competitive procedures to the maximum extent practicable. Assistance-specific competition requirements are found in 10 U.S.C. 2361. Procurement contracts, must strictly adhere to the Competition in Contracting Act (CICA). CICA is not applicable to assistance awards.

Assistance programs have various means of limiting eligible recipients such as setting funding aside for state and local Governments[10], requiring cost sharing from all proposers[11], or limiting the geographical area recipients can be located. Procurement contracts governed by the FAR have few options in regards to source selection. FAR Part 19 requires small business set-asides to the maximum extent practicable.

Responsibility Determination

The responsibility determination requirements for grants and procurement contracts are similar. For a grant recipient to be determined qualified to receive an award in accordance with Title 32 of the CFR[12], they must have sufficient technical resources, management systems, and financial resources. Recipients must also have satisfactory record of both executing similar programs and integrity or business ethics and be otherwise qualified and eligible. For a prospective contractor of a procurement contract to be determined responsible in accordance with FAR 9.104, they must have adequate financial resources, be able to comply with required or proposed delivery or performance schedule and have a satisfactory performance record and record of integrity and business ethics. Additionally, the must have the necessary technical skills and be otherwise qualified and eligible. Both types of award instruments are also required to check the list of excluded parties prior to award in accordance with Executive Order 12869-Reciprocity of Procurement and Non-Procurement Systems in Debarment and Suspension.

Award Announcement

The Federal Funding Accountability and Transparency Act of 2006[13] required the establishment of one single searchable website, accessible to the public, that includes information on all of the Federal financial assistance and procurement awards. Any financial assistance obligation action exceeding $25,000 must be made available on the website within 30 days. FAR 5.301 requires the same of any procurement agreements at the same threshold.

Cost Principles

Grant agreements are subject to the requirements as established by the OMB Circular A-102 – Grants and Cooperative Agreements with State and Local Governments and OMB Circular A-110 – Uniform Administrative Requirements for Grants and Other Agreements with Institutions of Higher Education and Other Non-Profit Organizations. Both grant agreements and procurement contracts are subject to the requirements as established by OMB Circular A-21 – Cost Principles for Educational Institutions, OMB Circular A-87 – Cost Principles for State, Local and Indian Tribe Governments, and OMB Circular A-122 – Cost Principles for Non-Profit Organizations.

Contract Closeout
The Federal Acquisition Regulation (FAR) at 4.804-5 provides detailed procedures for the closeout process
OMB Circular A-110, Subpart D, titled After-the-Award Requirements, contains closeout guidance and other procedures for subsequent disallowances and adjustments.

[1] P.L. 95-224, now codified as 31 U.S.C. chapter 63

[2] 31 U.S.C. 6303

[3] 31 U.S.C. 6304

[4] Reference Article 1, Section 8 of the US Constitution

[5] Public Law 106-107

[6] 31 U.S.C. 1301(a)

[7] 31 U.S.C. 1502(a)

[8] Public Law 97-258

[9] 31 U.S.C. 6301(3)

[10] 10 U.S.C. 2391

[11] 10 U.S.C. 2511

[12] Reference CFR Title 32 Subtitle A Chapter 1 Subchapter C Part 22-DoD Grants and Agreements-Award and Administration

[13] Public Law 109-282

An Economic Analysis of Issues Concerning Whether, or to What Extent, a Public Buyer Should Disclose its Estimates to Competing Firms.

2017-11-13T06:19:00.000-08:00

Background

Acquisition Planning in the United States of America

The United States Government awarded approximately $438 billion in contracts for supplies and services in fiscal year 2015[1]. The Federal Acquisition Regulation governs the acquisition process of the U.S. Federal Government as defined by the Code of Federal Regulations. FAR 7.104(a) states that the acquisition planning process should begin as soon as an agency identifies a need for supplies for services. During the planning process, the Government will commonly develop an IGE. An IGE allows the Government to estimate the costs a contractor is likely to incur while providing the supplies or performing the services to fulfill the requirement[2] and is the basis for reserving budgetary funding.

The Independent Government Estimate (IGE)

The Department of Defense Contingency COR Handbook states that an IGE is generally developed for commercial items, equipment, supplies and simple services routinely available on the open market with competitive pricing. [3] The IGE does not include breakouts of the various cost elements. IGE’s are “bottom-line prices paid or availability in the marketplace.” On the other hand, the Handbook defines the Independent Government Cost Estimate (IGCE) as generally used for services, construction, and non-commercial supplies.

Unlike the IGE, the IGCE attempts to capture the projected costs a contractor will likely incur during the performance of the contract. The IGCE also “provides the basis for comparing cost or prices proposed by contractors/applicants; and… serves as an objective basis for determining price reasonableness in cases in which one Contractor/Applicant responds to solicitation”.[4]Another important reason that these types of Government estimates are used is to ensure that the contractors understand the requirement[5]. IGCE’s are not meant to be the lowest or highest possible estimate of the cost and/or price for performance; IGCE’s are meant to be a projection of program costs[6]. The distinction between the IGE and an IGCE is unclear and inconsistent throughout most U.S. Federal Guidance.[7]

The Security Classification of the IGE

Most U.S. federal, state and local procurement guidance states that the Government should ensure the IGE remains confidential and only disclose it during negotiations or debriefings, when the Contracting Officer (CO) deems it appropriate.[8] The USAID IGE Guide indicates that the IGE is a procurement sensitive document and access should only be permitted on a “need-to-know” basis. IGE’s are subject to safeguards as required by 12 FAM 544, which describes information which warrants a degree of protection and administrative control that meets the criteria for exemption from public disclosure set forth under Sections 552 and 552a of Title 5, United States Code: the Freedom of Information Act and the Privacy Act.[9]

Developing the IGE

The U.S. Army Training and Doctrine Command’s IGE Preparation Guide[10] defines the IGE as “the Government’s estimate of the resources and the estimated cost of resources a prudent contractor will incur in the performance of a contract.” The TRADOC IGE Preparation Guide explains the importance of the analysis of variations between the contractor’s proposal and the IGE, especially in regards to the increased uncertainty for first time procurements.

The Air Force Contracting Construction Guide explains that the IGE is developed to be unbiased and “based upon the specifications and without the influence of potential contractor’s marketing effort or input.”[11] The design engineer or estimator is generally responsible for preparing the IGE. FAR 36.203 requires IGE’s be used when the anticipated award of a contract is $100,000 or more and must be prepared with the same amount of detail that would be required if the Government were also competing for the award. Federal regulations explain that the IGE should be developed using the same approach that a prospective contractor would. The IGE should include direct cost incidents and allowance for overhead costs, indirect costs and a reasonable amount of profit.

Preferred Cost Sources

There are three preferred sources for obtaining the necessary details to support the IGE. The first source is to utilize previous similar contracts. The competitive prices of the contractors on the previous similar contracts are used as the basis of each similar line item. The second source is the Architect-Engineers (A-E) estimate. A-E firms are required to use the most current computerized estimating programs, technology and commercial pricing guides in order to provide comprehensive, accurate and up-to-date estimates. A-E estimates account for changing trends in cost building and include any relative economics of various types of structures and materials. The third source is commercial pricing sources such as RSMeans® Construction Cost Data and WinEstimator®. These programs can provide the most accurate estimates because they allow adjustments for local labor rates, site conditions and material prices.

Cost Models & The Elements of Cost

The cost model that is utilized in the development of the IGE performs the calculations of price based on cost elements such as labor hours and rates.[12] The more elementary cost models only require simple pencil and paper calculations, while more complex cost models often require extensive computer models. The type of cost model that the estimate uses would provide any potential contractors with insight into how important each individual cost element is to the overall procurement. A lump-sum estimate provides the acquisition costs based of the bottom-line. Detailed estimates serve as the basis for determining the type of contract the proposal evaluation criteria. Detailed estimates identify eight elements of cost.

Classification of Employees, Direct Hours Required and Wage Rates

This cost category includes the type of employees required to execute the services needed to fulfill the requirement. The direct labor hours account for the number of hours required by each employee to complete the service. These estimates can be derived from historical workload.

Wage rates are the amounts paid to the different classifications of employees required to perform the contract. U.S. law requires, in accordance with the provisions of 29 CFR Part 1 and Part 5, the applicable Davis-Bacon wage determination set the minimum paid by contractors to laborers. The Department of Labor establishes these rates and they are available to the contractor anytime online. Providing these at the beginning of the solicitation would allow the contractors to easily reference and be put on notice to the lowest wages acceptable by law for the positions they are providing. They can then add justifications for any wages that are significantly higher than those provided.

Labor Burden

The labor burden cost category contains the costs for direct labor associated with employee benefits. The components of labor burden include payroll taxes, workmen’s compensation insurance, health and welfare, vacation, and holidays. TRADOC’s IGE Preparation Guide advises a 30% straight-line method be used for the preparation of the IGE.

Overhead

The overhead category includes all of the cost elements that are not already included in direct labor, labor burden, and other direct costs. The components of overhead are indirect labor, costs associated with labor and indirect supplies. TRADOC’s IGE Preparation Guide recommends a 15% overhead rate be used for general estimating purposes.

Other Direct Costs

An accurate estimate of the contractors other direct cost elements can be provided by reviewing the statement of work, determining necessary equipment, materials, and travel required to perform the contract.[13] What equipment and materials will and will not be furnished by the Government should be included in the initial solicitation. Because the Government already has this information, the estimate of costs for materials furnished, and not furnished by the Government can be developed. Allowing the contractors to see what the Government believes the direct cost to be should not provide any unfair advantage to the contractor because all of the information was previously available.

General and Administrative (G&A) Expenses

G&A costs are incurred by the company and cannot be associated with one specific project. The TRADOC IGE Preparation Guide states that that G&A rate in competitive acquisitions will usually not exceed 15%. Government’s could provide an IGE with its maximum allowable G&A rate, and advise the contractors that the rate they propose will determine how competitive their offer will be.

Profit/Fee

The Public Works and Government Services of Canada explain that profit levels recognize “the cost of money associated with the capital employed by the contractor”[14] as well as the business and contractual risks that are assumed by the contractor in the performance of the contract. The amount of profit that can be attributed to each area must be made in accordance with Canadian guidelines, which greatly eliminate the potential for biased in the selection decision. The total profit the lesser of the sum of supportable amounts by factor and 20% of total costs. Providing these calculations to the contractor up front would allow them to know the exact mechanics behind what profit they should be proposing and for what reason. It would also allow them the opportunity to dispute any of the determinations in the first round of negotiations and the procurement process would benefit from the efficiencies of not having to decipher how and why the contractor is proposing profit they way they think that they should be. Various examples of the calculations implemented by the Canadian procurement system are provided in Appendix I.

Benefits of Disclosing the IGE to Contractors

The U.S. Air Force (2006) states that one of the reason the Government needs an estimate is to ensure the contractors understands the requirement that the Government has. With a full understanding of the requirement, the case can be made that the contractor can then propose more accurately and/or propose a better way to technically execute the requirement. If the contractor knows exactly what the Government is looking to obtain, and how they think it is best to obtain it, they would be put in a better position to propose a technically acceptable performance plan that provides better value to the Government. Often, acquisition professionals and program management personnel struggle to determine how much a contract should cost accurately and confidently[15]. Disclosing all of the information that the estimate developed by the Government was based on would allow the contractor to feel more at ease with the basis of their proposed price.

Game Theory

Game Theory is the scientific study of strategy. Economists use Game Theory to explain and predict people’s behavior in strategic situations such as bargaining, auctions, and merger pricing[16]. Each player in any competitive market must consider the impact of their actions before deciding what they will do and how they will do it. The outcome for each participant depends on the strategies of not only themselves, but everyone else playing the game as well.

Auction Theory: The Winner’s Curse

In game theory, has the freedom to formulate the rules of the game. Auction theory provides one of the most useful test-beds for game theory because it has well-defined rules that yield clearer theoretical predictions[17]. In auction theory, the Winner’s Curse describes how in certain situations, the winner of an action will tend to overpay. Scholar Paul Milgrom of Stanford University defines the winner’s curse as traditionally referring to the selection bias that arises because a bidder tends to win more often when his value estimate is too high as opposed to when it is too low.[18] Because the auction winner always tends to be the bidder that overestimates the value, they are thought to be cursed for winning. The result of the award is usually the deterioration of the contractor’s financial stability and a bad quality service due to the contractor being forced to adopt opportunistic cost-reducing actions because they aren’t receiving enough finding to perform on the contract. In the worst cases, the contractor is forced into bankruptcy and is unable to perform on the contract all together. [19]

If the competing firms are aware of the Winner’s Curse, they tend to become crippled with the fear they may suffer losses. To mitigate the risk of loss, the contractor adopts an overly cautious bidding strategy, generating higher award prices. The winner’s curse is recognized in several court opinions such as Chicago Pacific Corp. v. Canada Life Assur. Co. 850 F.2d 334 (1988) and Flamm v. Eberstadt. 814 F.2d 1169 (1987).

Common Value

Auctions that place a common value on the winning prize are highly susceptible to the Winner’s Curse. The source selection criteria are provided to all bidders in the auction. The auction winner will be whoever bids the highest. The key characteristic in this situation is that the auction is worth the same thing to every bidder. The bidders have a common value, which is equal to the amount of revenue winning the auction will generate. Different bidders will estimate the revenue using different strategies, potentially resulting in the winning bidder paying too much.

Intrinsic Value

Auction theory also identifies a solution that makes bidders immune to the winner’s curse. Each individual bidder in the auction must have their own intrinsic value for winning the auction. When the basis of winning the award is the individual bidders underlying perception of value, derives from its own independent analysis, there is no longer a common value shared amongst all bidders. The value becomes specific to the individual bidder, dependent only on the personal preferences of the company. In this situation, it becomes easy for bidders to avoid overpaying because they limit their maximum bid to their individual estimation of worth. Consequently, the winner can always be a company that has bid below their individual value and the winner’s curse does not occur.

Application to Federal Procurements

To apply auction theory to the current negotiated procurement environment, the contractors must propose a contract amount based on its individual analysis of expected award value. Another solution to the winner’s curse is to design more comprehensive acquisition procedures that ease the contractors concern in regards to the inaccuracy of cost estimation while still raising good revenue. Allowing contractors access to more precise sources of information about the common cost components of the cost function of a contract (like the IGE) will result in less risk being prices into the proposals and a better value being offered to the Government. Several studies find that making the engineer’s cost estimate publicly available before the bid decreased the average bid level in Oklahoma[20]. The Navy was found not to be violating procurement regulations by providing significantly overstated line items to the bidder permitting them to lower the bid price and win the award in Academy Facilities Management v. United States, 87 Fed.Cl. 441 (2009). They also provided the variances from the IGE to both bidders, who both raised prices accordingly

The Risk of Disclosing the IGE to Contractors

FAR 36.203(c) permits the disclosure of the IGE during contract negotiations in order to identify specific specialized tasks and the cost breakdown figures associated with them. Guidance warns acquisition professionals that the disclosure of the IGE “may put the government at a disadvantage in dealing with contractors. Moreover, it gives contractors an unfair advantage over other contractors competing for the same requirement.”[21] At some states level, the cost estimate developed by the engineer’s for construction procurement is made available the day of bidding, while in other states, it is not available until after the bids are opened[22]. Many states are involved with organizations used to detect collusion such as the American Association of State Highway and Transportation Officials Transport System. They compare bid to the engineer’s estimate, the other bid received, and analyze past bidding behavior, price differences, and market prices according to various parameters. The Interdepartmental Bid Rigging Investigations Coordinating Committee developed guidance in 1983 that is still referenced today. They recommend that, though some state agencies include their engineer’s cost estimate for a project among the initial materials furnished to prospective bidders, a state engineer’s estimate should not be disclosed prior to the award of a contract. They go on to suggest that all estimates remain confidential because early release of this information encourages and/or facilitates bid rigging by permitting prospective bidders to gauge what the state agency would consider to be a reasonable price for the project and to decide how far a rigged bid may exceed the estimate without jeopardizing the award.

“We are not aware of any compelling business reason for making the state engineer's estimate available to prospective bidders. It is not necessary to help them estimate the cost of materials, since bidders are intimately familiar with these costs. Relying on past experience, bidders can readily determine their own mobilization and labor costs. We are advised that state engineers in some cases obtain the data on which their estimates are based from the same contractors who later bid on the job. We are persuaded, therefore, that the bidding process would not be impaired if the state engineer's estimates were withheld from prospective bidders prior to the letting of construction contracts[23].”

Disclosing the IGE could also lead to higher prices by serving as a focal point for tacitly collusive price setting. Thomas Schelling pioneered focal point theory in the 1960’s, noting that in simply games with many equilibria, agents can frequently identify a focal point and use it to coordinate. Tacit collusion occurs when firms agree to bid set amounts without explicitly saying so. If firms bid the amount provided in the IGE, even though they may be able to provide individual line items at a price that is more advantageous to the government, higher bids would be received. Knittel and Stango (2003) analyze tacit collusion in credit card issuer’s rates charged. They find that regulation created a focal point that allowed tacit collusion that disappeared with deregulation. If disclosure of the IGE facilitated collusion, it would not be in the government’s best interest. Morrison-Knudsen Co. v. Dept. of the Army of US, 595 F. Supp. 352 (D.D.C. 1984) held that the IGE being released before contract award would have an adverse effect on the procurement and any benefits expected from the competitive process. Federal Open Market Committee v. Merrill, 443 U.S. 340, 360, 99 S. Ct. 2800, 2812, 61 L. Ed. 2d 587 (1979) held that disclosing information in the IGE may place the Government at a competitive disadvantage or endanger the consummation of the contract. The M-K case also noted that disclosure of the IGE might discourage commercial firms from taking the initiative to come up with more innovative techniques for cutting costs in the hopes of underbidding. Quarles v. Department of Navy, 893 F.2d 390 (C.A.D.C., 1990) held that cost estimates are derived from complex set of judgments and thus are not merely fixed facts, and there is possibility of harm to the decision-making process from disclosure of estimates by discouraging candid opinions and by unleashing forces which could preclude alternatives other than one supported by cost projections. Disclosing the IGE can also result in firms deliberately underbidding jobs, a practice known as “buying in.” FAR 3.501-2 defines buying-in as an improper business practice of submitting an offer below anticipated costs, expecting to increase the contract amount after award or receive follow-on contracts at artificially high prices to recover losses. Buying-in often decreases competition and results in poor contract performance. United States ex rel. Hooper v. Lockheed Martin Corp., No. 11-55278 (9th. Cir. 2012), Lockheed was found to have knowingly underestimated its costs when submitting its bid, which can be a source of liability under the False Claims Act.

Conclusion

The IGE identifies the resources and the cost of those resources that a prudent contractor will require in order to provide goods and/or services. It is one of the tools used to assist Contracting Officers in determining the reasonableness of a bid or proposal. Mixed guidance on disclosure procedures are scattered throughout regulations and guidance in the United States. Most of what exists warns against the detriments of disclosure. Numerous economic theories, such as game theory, auction theory and focal point theory, provide a substantive basis for deciding issues concerning whether, or to what extent, a public buyer should disclose its estimates to competing firms. The first argument as to whether the IGE should be disclosed identifies its potential to help firms reduce the amount of uncertainty about the project cost (thus reducing the risk of the "winner's curse"). Alternatively, disclosing the IGE may place the Government at a competitive disadvantage, promote buy-in and disincentive innovation. In any case, it is left up to the contracting officers discretion on what and when to disclose in order to facilitate the procurement process. Each individual case must be handled based on its specific requirements and what will be best in that situation.

[1] U.S. General Services Administration. (n.d.). Federal Procurement Data System - Next Generation. (IBM) Retrieved March 12, 2016, from https://www.fpds.gov/fpdsng_cms/index.php/en/.

[2] USAID. (2013, April 02). Independent Government Cost Estimate Guide and Templete. Retrieved March 16, 2016, from A mandatory Reference for ADS Chapter 300: https://www.usaid.gov/sites/default/files/documents/1868/300maa.pdf.

[3] Department of Defense Contingency COR Handbook, Appendix D: Contract Planning and Source Selection.

[4] USAID. (2013, April 02). Independent Government Cost Estimate Guide and Templete.

[5] U.S. Air Force. (2006, February 08). Government Estimate Training. Retrieved March 16, 2016, from Silver Flag.

[6] USAID. (2013, April 02). Independent Government Cost Estimate Guide and Templete.

[7] For the purposes of this paper, IGE’s and IGCE’s will be referred to as IGE’s.

[8] U.S. Department of State Foreign Affairs Manual Volume 14 Handbook 2. (n.d.). 14 FAH-2 H-350. Retrieved March 12, 2016 , from Independent Government Cost Estimate: http://www.state.gov/documents/organization/89058.pdf.

[9] 12 FAM 540, Sensitive but Unclassified Information (SBU), (TL: DS-61; 10-01-1999) 12 FAM 541 SCOPE, (TL: DS-46; 05-26-1995.

[10] TRADOC PAMPHLET 715-6 INDEPENDENT GOVERNMENT ESTIMATE PREPARATION GUIDE, 19 July 2000.

[11] AFFARS IG 5336.9201

[12] U.S. DEPARTMENT OF COMMERCE, National Oceanic and Atmospheric Administration AGO IGCE GUIDE, Effective or Revised Date: 09/13/2007.

[13] TRADOC PAMPHLET 715-6 INDEPENDENT GOVERNMENT ESTIMATE PREPARATION GUIDE, 19 July 2000.

[14] Public Works and Government Service Canada, Supply Manuel 10.65(c), Calculation of Profit on Negotiated Contracts.

[15] Ipsaro, M. (2011, June). Contract Management. Retrieved March 16, 2016, from How an Independent Government Cost Estimate Can Help You Determine How Much Your Contract Should Cost.

[16] Gittins, Ross. How Economists Put Game Theory to Practical Use. Sydney Morning Herald (Australia) October 20, 2012.

[17] Ausubel, Lawrence M., “Auctions: Theory” For the New Palgrave, 2^nd Edition. University of Maryland.

[18] Putting Auction Theory to Work, page 256.

[19] The Handbook of Procurement, Cambridge, Part III: Competitive Tendering Strategies, University Press 2006.

[20] De Silva, Dunne, Kankanamge, and Kosmopoulou, 2008 and De Silva, Kosmopoulou, and Lamarche, 2009

[21] IG5336.9201-1.6. Protection of the IGE.

[22] Barrus, David. Single Bidders and Tacit Collusion in Highway Procurement Auctions. University of Kentucky. January 2013.

[23] U.S. Department of Transportation, Federal Highway Administration. Contract Administration – Suggestions for the Detection and Prevention of Construction Contract Bid Rigging. February 1983.

Acquisition and Shareholder Value

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Firms purchase other corporations for the numerous benefits that are offered through acquisitions. The firm gains source supply because they have access to the source supply that the previous owner of the corporation did. They also acquire their new distribution channel. If they decide to keep the employees that were working at the corporation, they gain new creative talent that can offer the current workforce and different perspective on how to do things. Acquiring corporations adds value to a company and enhances its earnings per share. It can also add new product lines to ones already established. Firms gain the technology that the corporation was implementing and access to an established infrastructure. They increase their access to working capital finds and gain an advantage for time to market. The rapid expansion of customer base obviously isn’t the only benefit that makes acquiring corporations the best return on investment for large firms (Hari, 2011).

The amount that a firm pays for the corporation that it is acquiring factors in many different aspects. The value of strategic fits are difficult for anyone to measure and are very much up to both of the companies involved in the merger. The accounting, tax, and legal aspects must be factored in a well and usually tend to be very complex. The firm may be gaining market share because they are eliminating the competition, which can appear very valuable to the firm. Mergers can also lead to a lower cost of capital and lower taxes (Advameg, Inc, 2012). All of these different benefits have to be factored into the valuation of the corporation that is being acquired. It is solely the firm’s decision when deciding how much they are willing to pay for corporations.

The National Bureau of Economic Research (2012) suggests mergers and acquisitions destroy shareholder wealth in the acquiring companies and that “over the past 20 years, U.S. takeovers have led to losses of more than $200 billion for shareholders”. These losses are primarily dominated by acquisitions that are made by large firms. It is thought that when a large firm’s begins to go down the acquisition route, they have exhausted all internal growth opportunities. Even if a takeover results in a positive net present value, negative return can be seen in share prices following the transaction.

References

Advameg, Inc. (2012). References for Business. Retrieved from Mergers and Acquisitions- advantages, percentages, types, benefits, cost, Types of acquisitions: http://www.referenceforbusiness.com/small/Mail-Op/Mergers-and-Acquisitions.html#ixzz1rYs3xldm

Balls, A. (2012). The National Bureau of Economic Research. Retrieved from Big Firms Lose Value in Acquisitions: http://www.nber.org/digest/aug03/w9523.html

Hari. (2011, August 2). Knowswhy. Retrieved from Why Do Firms Purchase Other Corporations?: http://www.knowswhy.com/why-do-firms-purchase-other-corporations/

ISO 9000

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The ISO 9000 focuses on quality management. More specifically, it addresses what an organization needs to do to meet customer quality requirements, abide by regulatory requirements, increase customer satisfaction, and continually improve performance (International Organization for Standardization, 2011).

The benefits of using ISO 9000 when upgrading processes or software systems are numerous. Following the set of standardized requirements for these new quality management systems is critical because they provide the necessary fundamental aspects of performance improvement, documentation, training, finance and economics. The standards allow for the organization using them to be auditable. It is important to be auditable so that both internal and external groups have a way to measure if specific requirements are being met. Management can use it to see if they are fully in control of organizational activities and clients can use it to gain confidence that the organization can provide products and services that meet their requirements.
If an otherwise good manager refused to enforce the prescribed standardized processes I would convey to them that enforcing the standards is not optional. It is something that is essential to the project being completed and is an imperative step. I would be forced to put them on a different project that did not involve enforcing standards for ISO 9000 is the continued to not comply. I may even be forced to downgrade them to a non-supervisory position until the upgrading process is complete. If the standards aren’t implemented, the organization is no longer auditable and the entire focus of ISO 9000 is not accomplished. I would, therefore, not be able to have managers on my team who did not support the mission, regardless of how good of a manager there are.

References

International Organization for Standardization. (2011). International Organization for Standardization. Retrieved from ISO 9000- Quality management: http://www.iso.org/iso/iso_catalogue/management_and_leadership_standards/quality_management.htm

Operations Management

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The company should be able to take advantage of economies of scale and use collective resources in order to maximize usefulness. This will also keep the strategic and mission objectives from being pulled in too many directions. This would not be the best plan if there is an unexpected supply issue leading to essential resources being unavailable, inadaptable and unobtainable.

The structure of a company globally needs to be influenced by the identity of the organization. The company has to ensure that they are going to be able to grow and establish new market share without neglecting their current market share. If a company spreads themselves too thinly end up learning an expensive lesson that they were not fit to compete internationally (AIU, n.d.).

Formalization keeps established strategies and operations in place. This is important for accurately forecasting future performance of the company. Specialization allows for the creation of a niche market. This gives businesses a competitive advantage over the competition, regardless of their size. Centralization has the ability to both strengthen and isolate companies. Which impact is seen depends on the location strategy chosen. A central location proves to be most beneficial for strategic positioning.

The first big decision that a company needs to make based on their organizational identity and structure when going global is the location of their headquarters. The decision needs to be made whether or not the headquarters will be centralized in one main location or subdivided into various locations that would help to meet the goals and objectives of the organization better than one location. Organizational characteristics need to be adjusted for the culture of the new society.

Organizations must be sensitive to international laws, labor laws, and regulatory concerns when they endeavor on an international expansion (Kogut, 1998). There should also be a focus on cultural translations of the service or product a company is providing. Ensuring that all aspects of the business translate well into each specific country is most beneficial for managing the risk of offending the consumer. The cost of doing business should also be considered, as things such as regulations and taxes can be pricey if not forecasted.

References

AIU. (n.d.). Course MGMT415- Global Operations Management. Retrieved from Managing Resources & Operations: https://mycampus.aiu-online.com/Classroom/Pages/multimediacoursetext.aspx?classid=316435&tid=204&uid=284898&HeaderText=Course Materials: MGMT415-1202A-02 : Global Operations Management

Kogut, B. (1998). International business: The new bottom line. Foreign Policy, 152–162.

Global Business Competitiveness

2012-04-06T20:54:00.002-07:00

Businesses have found it increasingly important to become competitive in the global business environment for several reasons. The advantages that come along with expanding into the international market place have given businesses a competitive edge over each other. The more efficiently that you can do business, the more money that you are going to be able to make. In order to dominate your specific market, executing effective operations management is key. If businesses cannot keep up with the face pace and standards of operations management in their industry, they will be left in the dust.

Operations management involves the acquisition, development, and utilization of resources for products, processes, services, and supply chains. Operations management is constantly advancing here is America as well as in countries around the globe. A software company in Walldorf, Germany named SAP was the originator of the concept of supply chain management server software (McGraw-Hill, 2006). It automated the supply chain management process.

I have been personally affected by this over the last year. I work for the Defense Logistics Agency and we are in the process of converting our supply chain management from BSM to EBS. Our EBS system was designed by that same German company, SAP. We converted to the new system so that we can keep our supply chain management current and up to date with the acquisition industry. In order to be competitive, companies have to ensure that they are using the most innovative technology or their competitors will have the upper hand.

References

McGraw-Hill. (2006). Introduction to Operations Management. Retrieved from McGraw-Hill: http://highered.mcgraw-hill.com/sites/dl/free/0070965390/451252/samplech01.pdf

The Three Forms of Business Organizations

2012-04-06T20:52:00.003-07:00

The three forms of a business organization are sole proprietorship, partnership, and corporation.

A sole proprietorship is an unincorporated business that is only owned by one person (IRS, 2012). They are the most numerous form of business organizations in the United States. Sole proprietorships are very easy to both form and dissolve. Advantages include low start-up costs, low operational overhead, and no corporate income taxes. The sole owner receives all of the profits. These businesses are also subject to fewer regulations, which is an additional perk. Disadvantages include unlimited liability for the sole owner, limited life, and increased difficulty to raise capital (Garrison PhD., 2012). Unlimited liability for the sole owner means that the owner is personally responsible for all actions and debts incurred by the company and any of its employees. Limited life for the company means that when the owner dies, so does the business.

A partnership is an unincorporated business that has more than one owner (IRS, 2012). A business is defined by the IRS as members who carry on business, trade, financial operations, or ventures and then divide the profits from them. The three different types of partnerships are general, limited, and limited liability partnership. The differences between the three are found in the degree of management control and personal liability. Advantages include the enhancement of value via synergy, ease of formation, greater potential for capital access, and no corporate income taxes. Partnerships, like sole proprietorships, are typically subject to fewer regulations. Disadvantages only slightly differ from those of a sole proprietorship. There is unlimited liability, limited life, and additionally, the possibility of conflicts arising between partners. Conflicts that are unable to be solved typically result in the dissolution of the partnership (Garrison PhD., 2012). Unlimited liability can be avoided with a limited liability partnership. A limited liability company can be owned by one or more members and each member has a limited personal liability for the actions and debts incurred by the company. Advantages of limited liability businesses include management flexibility and pass-through taxation (IRS, 2012).

Corporations are legal entities that do business. They differ from sole proprietorships and partnerships because they are distinct from the members who own the company. The types of corporations include public or private standard, for-profit, charitable, and not-for-profit. Advantages include unlimited commercial life, flexibility in capital raising, ease of ownership transfer, and limited liability. Disadvantages include regulatory restrictions, increased organizational and operational costs, and double taxation.

Financial managers are responsible for looking out for the corporation’s shareholders. The main goal of financial managers is to maximize profits and the main goal of a corporate financial manager is to maximize the current value per share of the existing stock (Ross, Westerfield, & Jordan, 2008). If the corporation’s stock is not publicly traded, the financial managers’ goal is to “maximize the market value of the existing owners’ equity” (Ross, Westerfield, & Jordan, 2008). I believe that the validity of the goal encompasses the essential core values that all financial managers should possess however, the statement could be interpreted the wrong way. If the financial manager is doing something illegal or unethical to increase the current value, he would be failing to make good financial decisions on behalf of the shareholder. A corporate financial manager should focus on making the best financial decision for the shareholder and include its profit potential alongside whether or not it is legal or ethical and how it would reflect on the corporation’s name. There is much more to making sound financial decisions than whether or not it will increase the value of the shares. That is why the main goal of financial managers for corporations in flawed in my opinion.

References

Garrison PhD., S. (2012). Study Finance. Retrieved from Types of Business Organization: http://www.studyfinance.com/lessons/busorg/

IRS. (2012, March 16). Retrieved from Sole Proprietorships: http://www.irs.gov/businesses/small/article/0,,id=98202,00.html

IRS. (2012). Retrieved from Limited Liability Company (LLC): http://www.irs.gov/businesses/small/article/0,,id=98277,00.html

IRS. (2012). Publication 541. Retrieved from Table of Contents: http://www.irs.gov/publications/p541/ar02.html#d0e252

Ross, Westerfield, & Jordan. (2008). Essentials of Corporate Finance. Retrieved from The Goal of Financial Management: http://highered.mcgraw-hill.com/sites/0073405132/student_view0/ebook/chapter1/chbody2/1_4_the_goal_of_financial_management.html

Financial Ratios

2012-04-06T20:51:00.002-07:00

The current ratio tests the liquidity of a company. It is calculated by dividing the current assets by the current liability. The ratio tells us the proportion of the current assets that are available for the company to cover the current liabilities that it has (Loth, 2012). The ratio ascertains whether the short term assets of a company can readily pay off the short term liabilities. Cash, marketable securities, inventory, receivables, and cash equivalents are all short term assets. Payables, taxes, accrued expenses, current portion of term debt, and notes payable are all short term liabilities. This ratio is frequently used in financial reporting because it is important for a company to have enough current assets to cover its current liabilities. The ratio is important to banks because short-term creditors should prefer a higher current ratio as it means reduced risks for the bank. The ratio is important for investors to understand because if a company has a lower current ratio, it is an indicator that the company is using more of their assets to grow the business (Internet Center for Management and Business Administration, Inc. , 2012).

The quick ratio is calculated by finding the sum of a company’s liquid current assets minus inventory and dividing those by current liabilities. It is much like the current ratio but excludes inventory. The higher the ratio, the more liquid that a company is thought to be. The current assets that are used to calculate the ratio cash, notes receivable, and accounts receivable. Banks can use this formula when determining whether a company is a good candidate for a loan. A good candidate is one who is low risk. Investors need to understand the quick ratio because it can help them to determine the likeliness of the company to yield a high return (Quickratio.org, 2011).

The debt ratio is a company’s total debt divided by its total assets. The ratio indicates the long term solvency of a company (Internet Center for Management and Business Administration, Inc. , 2012). The ratio can be important to banks because the measure how much and to what extent a company is using long term debt. It also measure the company’s ability to repay any long term debt they may have. Investors need to know the meaning of the ratio because it will help them in determining the company’s level of risk based of its financial health.

The return on equity ratio measure how profitable a company is. It is calculated by dividing the net income by the shareholder equity. Investors would be wise to understand the ratio because it is essentially the bottom line measurement of profits earned per dollar invested. It tells investors exactly how much their dollar is earning them. The higher the rate of return on equity, the more efficient that a company’s management has been in utilizing the equity base. It is important for banks to understand the return on equity ratio because it is a profitability indicator that can show just how well a company is doing (Kulkarni, 2011). This could also be used to mitigate risk when trying to decide whether or not to extend a line of credit to a company.

References

Internet Center for Management and Business Administration, Inc. . (2012). Finance. Retrieved from Financial Ratios: http://www.netmba.com/finance/financial/ratios/

Kulkarni, A. (2011). Buzzle.com. Retrieved from Return on Equity Ratio: http://www.buzzle.com/articles/return-on-equity-ratio.html

Loth, R. (2012). Investopedia. Retrieved from Current Ratio: http://www.investopedia.com/university/ratios/liquidity-measurement/ratio1.asp#axzz1qF6PNKt1

Quickratio.org. (2011). Quickratio.org. Retrieved from The Importance of Quick Ratio: http://www.quickratio.org/

Big Investors vs. Small Investors

2012-04-06T20:50:00.001-07:00

There are many disadvantages that come with being a small investor. Many believe that big investors in the stock market are the major players that get to earn most of the profit while the small investors are left in the dark. Often, small investors lack the capital to build a truly diversified portfolio. When buying and selling stock, larger lot sizes often take precedence over smaller lots sizes (Benoit, 2006). Small investors also usually receive news later than large traders, mutual funds, and brokers do. Another disadvantage that small investors face is the lack of access to highly sophisticated analytical software that large brokerage firms use to obtain the upper hand in their trading decisions.

It has also been noted that the more money an investor has, the better tips that they are likely to get. The Wall Street Journal sited Goldman Sachs holding trading huddles with the richest of their clients and giving them stock advice that they hadn’t divulged to their other customers with less money (Jagow, 2009). There is a lot of evidence to support the saying that the rich get richer. To the small investor, it can seem almost hopeless when trying to get the same treatment as you richer co-investors.

While there are many disadvantages that small investors face, there are also many advantages that they have. Most individual investors can afford to hold the stocks that they own for five plus years. Most of the firms working on Wall Street cannon do this because of the pressure they face to have short term profits that are locked in. Ben Graham, a mater investor, explains that the market becomes more and more predictable as your time frame increase (Hanson, 2006). The buy and hold strategy reduces the fees, taxes, and commission cost significantly over time.

There are also many rules and regulations that favor the small investor. Small investors can exit IPO stocks right away, while most institutional players are limited in early exits. Small investors are therefore, less prone to the risk of fluctuating stock prices. Small investors also have a great ability to move in the same or opposite direction of the trend because their small purchases don’t move the stock price significantly. Big investors are forced to slowly build their position in any stock because of the impact that such a large purchase makes.

References

Benoit, D. (2006, March 1). Investment Banter. Retrieved from Name the disadvantages of being a small investor: http://www.investmentbanter.com/showthread.php?t=90820

Hanson, T. (2006, January 9). The Motley Fool. Retrieved from Secret Advantages for Small Investors: http://www.fool.com/investing/general/2006/01/09/secret-advantages-for-small-investors.aspx

Jagow, S. (2009, August 24). Marketplace Scratch Pad. Retrieved from Big investors vs small ones: http://www.marketplace.org/topics/business/marketplace-scratch-pad/big-investors-vs-small-ones

Sole proprietorship, partnership, and corporation

2012-03-19T12:40:00.001-07:00

The three forms of a business organization are sole proprietorship, partnership, and corporation.

References

Garrison PhD., S. (2012). Study Finance. Retrieved from Types of Business Organization: http://www.studyfinance.com/lessons/busorg/

IRS. (2012, March 16). Retrieved from Sole Proprietorships: http://www.irs.gov/businesses/small/article/0,,id=98202,00.html

IRS. (2012). Retrieved from Limited Liability Company (LLC): http://www.irs.gov/businesses/small/article/0,,id=98277,00.html

IRS. (2012). Publication 541. Retrieved from Table of Contents: http://www.irs.gov/publications/p541/ar02.html#d0e252

Pricing

2012-02-29T12:03:00.003-08:00

When managers are deciding how to price their products, they have to focus on many important cost and market factors in addition to legal issues that they may encounter. Prices are usually determined by supply and demand that clears the market unchanged by price controls (Cox, 1997). Price controls are set in place by legislation on many products to keep the price from going to high. Management would have to comply to any price controls that are set in place for the specific product that they are offering the market. Competition in the market forms the prices that people are willing to pay for a good or service (Ballve', 1956). If the management knows from their prior research that their product is in abundant supply, they should look to competitors pricing and try to match the ranges that they are pricing, making adjustments based on the quality of the product in comparison. If research suggests the product is scarce and in high demand by the public, pricing should be adjusted higher because of the willingness of the consumer to pay the inflated price. This is why is it thought that the free market is the sovereignty of the consumer (Ballve', 1956).

Price discrimination that offers product at different prices based on the consumer type can also be illegal so management needs to be sure they are pricing in accordance to all of the laws in the area where they are making sales. Management needs to ensure that they are covering all of the expenses that were incurred during the production of the product including materials, labor, and overhead. Selling products at a loss or at the break-even point will have no benefit to the company.

Discounted cash flow is a valuation method that analyzes how attractive an investment opportunity is (Investopedia, n.d.). It uses projected future free cash flow and discounts them from the weighted average cost of capital to determine the present value of the investment. If that value is higher than the current cost, it is determined that the investment is undervalued and has the potential to be a good investment. I would disagree with the R&D manager because it is not impossible to use the DCF Method in research and development. You don’t need to measure cost saving; instead, they would forecast future earnings based upon if the research and development project were successful and factor that into the equation (Hindinger, n.d.).

References

Ballve', F. (1956). Essentials of Economics: A Brief Survey of Principles and Policies. Mexico City. Retrieved from http://freedomkeys.com/pricecontrols8.htm

Cox, J. (1997). The Concise Guide to Economics (Second Edition ed.). Savannah-Pikeville Press. Retrieved from http://freedomkeys.com/pricecontrols3.htm

Hindinger, J. (n.d.). eHow Money. Retrieved from How to Use Discounted Cash Flow (DFC) in Research and Development: http://www.ehow.com/how_6576330_use-flow-_dcf_-research-development.html

Investopedia. (n.d.). Investopedia. Retrieved from Discounted Cash Flow-DFC: http://www.investopedia.com/terms/d/dcf.asp#axzz1nmvqV5Cn

E-books or Paperback?

2012-02-29T12:02:00.002-08:00

My research suggested that the younger that the consumer was, the more likely they were to make their purchases online. Those who did a lot of their shopping online said that it saved them time and gas money that they would have used sitting it traffic and shopping, had they physically gone to the store. Those online shoppers also boasted that they could find better deals online and very rarely had to pay fees on shipping. Another interesting twist was people who bought books that they read on a device that they already owned, which completely eliminated the need for any shipping at all. The young group mostly looked for deals on textbooks that they could only find online. The people in the middle age group purchased mostly books, more specifically, reference or leisure. This probably has to do with the fact that most of them have completed their degrees. The few people who did purchase books online from the older group were the more tech savvy of their generation. This group made the fewest online sales from those who I questioned on the topic.

The people who bought books that they read on their devices seldom noted a reason to ever enter a brick and mortar establishment. The books summary and description are available on the site that they purchase it from. Most have 20-30 pages as a preview to the reader before they commit to the purchase. This is very similar to thumbing through the pages of a book that you would pick up in a brick and mortar establishment. These online store have libraries that you can browse through if you don’t know what you want as well as convenient searches that lead the reader to almost anything they could ever dream of reading. It some situations, it was ever noted that actually having to go to find a book in a store would take more time and effort than the online store.

The younger 50% of the demographic that I spoke to don’t buy paper copies of books at all. They take up space and in some instances, cost notably more than the electronic version. The older people got, the more attached they seemed to the sentimental idea of their books. They wanted to be able to dog ear the pages and keep their copy to read again in the future with their already extensive collection of books that they had acquired over their lifetime. Amazon, who is one of the largest sellers of the e books, says that they outsell the printed version two to one (Association of American Publishers, 2011).

References

Association of American Publishers. (2011, April 15). Engadget. Retrieved from E-book sales triple year-over-year, paper books decline in every category: http://www.engadget.com/2011/04/15/e-book-sales-triple-year-over-year-paper-books-decline-in-every/

Job Order Costing Method Versus The Process Costing Method

2012-02-22T19:17:00.000-08:00

The job order costing method is used for measuring and individual job or batch order whereas the process costing method is used for measuring different aspects of the process itself. The process costing method also measures the standardized units that are being produced. Process operations are repetitive, highly standardized, and usually used in situations that involve high production volume. The products processes have little flexibility and result in a homogeneous product or service. Job order operations are custom orders that result in heterogeneous products or services. Unlike the operations for processes, job order operations have a low production volume, a high level of flexibility during the production process, and low to medium standardization of the actual product.

All of this means that the costing methods for both have to be tailored to the type of production that is being implemented. They have both similar and contrasting aspects to the inner workings of their systems. Job order costing specifically assigns jobs direct materials, labor, and overhead. When the cost of the total job is divided by the number of units that the job produced, the result is the total cost per unit.

The process costing method assigns these same direct materials, labor, and overhead to a specific process as opposed to a job. The processes total cost is found and then divided by the amount of units that must pass through the process during production. The result is the cost per equivalent unit. Both methods are “ultimately interested in determining the cost per unit of product (or service) resulting from either system” (Wild & Shaw, 2012, 1).

The company that I work for would best benefit from the process costing method. We do fuel acquisitions which is a service we provide for our customer, the warfighter. We have several different methods that we use for each procurement. The easiest way to place costing metrics on each acquisition would be to measure the amount of money that is spent on each individual process required. An emergency buy (ebuy), which normally takes a few days, does have the same processes applied to it as a bulk fuel acquisition which takes month to complete. Using this method would leave room for variety in the services that we offer.

References

Wild, J. J., & Shaw, K. W. (2012). Managerial Accounting. New York: McGraw Hill/Irwin.

New Consumer Products, Target Markets, & Competitive Advantages

2012-02-16T19:30:00.001-08:00

The new consumer product is called The Body Ball. It is a small inflatable ball that has two resistance bands made of rubber attached to each side. My target market is anyone who is in the fitness industry, interested in fitness, or is simply looking to get into shape and lose weight. The ball will be a condensed version of several different types of fitness equipment and can be easily used from the privacy of home for any shy consumers out there. The ball could be sold in volume to any gyms who want to use it for classes or make it available for gym goers to use in their free time. Gyms always want to have the most modern equipment and this would be an opportunity to stay ahead in their industry.

A good song for the campaign would be anything that was very upbeat or had to do with fitness or working out. Some suggestions would be “Move It” by the artist Dope. A good endorser would be someone very fit and athletic, even someone who had a career in the fitness industry such as Bob Harper from The Biggest Loser. “According to the U. S. Food and Drug Administration (FDA) Americans spent an estimated $30 billion a year in 1992 on all types of diet programs and product” (Worldometers, 2012, 4) and that means there is a huge market out there for us to get a slice of. It is easier to make money off of a product when you have a larger segment of people that are going to have a potential interest in your project.

This is a very unique product that many have never seen anything like. By showing the results that the product can produce, people are going to want to get their hands on this piece of fitness equipment. We can advertise in gyms and on television so that we can target as much of our specific market segment as possible. We are poised to compete with the competition because, as many people have never seen or used this product before, they aren’t going to have any idea what type of results that it can produce. They will have to try it on their own to figure out how well that it works. New products spark peoples interest and a lot of people are so desperate to lose weight that they are willing to try anything. This will be a very high quality product and good marketing could make this product a lot of money. If we could get commercial time when shows that are specifically targeting weight loss, such as The Biggest Loser, we will be able to reach more of our target market as well.

References

Worldometer. (2012). Real time world statistics. Retrieved from http://www.worldometers.info/weight-loss/

Successful and Unsuccessful Marketing Plans

2012-02-16T19:28:00.001-08:00

Introduction

A marketing plan can make or break the overall success of a product or service. The way that fire services has both failed as well as succeeded with their different marketing techniques is a good example and the things that should and should not be done when trying to carry out a successful marketing plan. The movie Warrior’s failure to attract an audience used the excuse that America wasn’t ready for MMA. Taking a look back, it seems that it may have been the marketing teams fault more than Americas. Each of these examples are great to look back and learn from for any marketing plans that are created in the future.

Marketing Plans

A marketing plan is a company’s action program that details the strategy that they are using or planning to use. The strategy can be for one specific product or an entire line of products, depending on how individualized the plan is. The plan should be a “fully detailed analysis of the market you are participating in, strategies you’ll employ and the tactics for executing these strategies” (MarketingPlan.net, 2011). The marketing plan can make or break the level of success that a product or service achieves. A lot of time, effort, and energy should be placed into a marketing plan because of the impact it has.

Fire Services

The marketing plan for Fire Services was successful for many different reasons. They looked at their services as a whole and tried to utilize every aspect of the service in their marketing plan. Respected speaker on fire services marketing Ben May stated “how we perform our job, our uniforms, our apparatus, our public appearance, and non emergency public exposure all market us to the community” (Hyden, 2011). His ability to see fire service as a concept reinvents the way that they go about doing their marketing.

Fire services start with their strategic plan and develop their marketing plan from that. This enables the fire service provider to keep the original vision in mind. They utilize the strategic plan as a navigation tool for the marketing that they do. This is a good example of how including all of the aspects of the product or service that you are creating a marketing plan for can lead to the overall success of the product or service itself.

In the same article, reasons that marketing attempts have failed in the past is highlighted. The major reason for marketing failure has been company’s inability to separate marketing from selling. They detail how the modern day marketing techniques that are used are a relatively new concept. Where, in the past things have been sold because we need them to meet our everyday needs, the newer marketing is geared towards meeting needs and wants and reaching out for people disposable incomes as well.

This is a good example of the fact that knowing the strategic plan and using it to implement your marketing plan is key. If the right elements of a product or service fail to be built on, it has the potential to compromise any marketing efforts that have been put together by the company. From the examples, it is obvious that what is chosen to be in the marketing plan is essential. An extensive and well thought out marketing plan is imperative to the success of any product or service.

Warrior

A recent movie that was dubbed a failure by critics alike was called Warrior. Part of the reason that led the movie to be a failure was MMA’s lack of mainstream appeal. The movie was about MMA fighting. It was concluded that the public just wasn’t into the idea of MMA fighting enough to take an interest in going to see a movie about it.

Instead of being a breakout movie to introduce MMA to a broader audience, it ending up flat out failing miserably. This could have been the marketing teams fault because they failed to spike the public’s curiosity about the emerging sport. It could also be that people just aren’t interested in cage fighting. Nevertheless, the movies marketing team was unsuccessful in securing the markets interest and the movie’s box office debut turned out to be a disaster.

The more saddening truth about the movie is that its marketing team had a budget of $45 million dollars (Snowden, 2011). Contrary to the title of the article “Does Warrior’s Box Office Failure Show The Mainstreams Still Not Ready for MMA And The UFC” (Snowden, 2011), there is a lot of contradictory evidence that we have seen. Shows about The UFC, such as The Ultimate Fighter, have gained large audiences in the past. If so many people can be interested in a television show, the marketing team for the movie should have been able to produce a better turn out for the movies box office debut.

A large audience also shells out a hefty amount buying UFC fights on paper view. The marketing team for this project did not do a good job of taking advantage of the elements of marketing that these shows and events do. I don’t think that it was the audience not being ready for MMA; I think that is a prime example of when marketing plans fail.

Conclusion

From a failure at the box office for an MMA movie, to the successes and failures of fire services marketing campaign, there is a lot that can be learned. Not making the same mistakes as other have in the past is one of the best ways to ensure success in marketing. An extensive and well thought out marketing plan can help a product or services success immensely. These examples help to show the gravity of poor decisions as well as plans that paid off.

References

Hyden, T. (2011, April). Retrieved from At the Crossroads: Fire Service Marketing and Strategic Planning: http://ehis.ebscohost.com.proxy.cecybrary.com/eds/pdfviewer/pdfviewer?vid=2&hid=101&sid=e367d57d-e0e2-45e7-ade6-b6c977d8e89d%40sessionmgr112

MarketingPlan.net. (2011). Marketingplan.net. Retrieved from What is a Marketing Plan?: http://www.marketingplan.net/what-is-a-marketing-plan/

Snowden, J. (2011, September 19). Retrieved from Does Warrior's Box Office Failure Show The Mainstreams Still Not Ready For MMA And The UFC?: http://mma.sbnation.com/2011/9/19/2434990/UFC-News-movie-mainstream-warriors-box-office-failure-show-the-mainstream-fox

Management Accounting

2012-02-08T10:18:00.001-08:00

The different types of accounting information are financial, managerial and tax accounting. Managerial is the most important information because it is prepared for internal use. Financial accounting is prepared mainly for stakeholders and creditors. Managerial accounting can help with establishing the goals of a company. It can also be useful as a performance metric and decision making tool.

Internal accounting information is an extremely useful tool when management is trying to make decisions. Decision-making performance can also be evaluated using internal accounting information. There are not set rules on how internal accounting is done like there are with financial accounting. It can be presented in any manner that is helpful to the people receiving it internally without consequence. Internal accounting information is usually focused on the goals that they are looking to achieve and is future oriented. It is important that the information that internal accounting is based upon is timely.

A “management accounting information system can help businesses run better by providing timely information on internal operations” (Shanker, 2012, p.1) Technology is used to develop and communicate information by means of email, video conferencing, teleconferences, fax machines and videotapes. All of the venues are useful when implemeting information technology. Many people in a large company can be reached with minimal effort which is ideal for busy managers.

References

Shanker, S. (2012). Chron. Retrieved from How to Establish a Management Accounting Information System: http://smallbusiness.chron.com/establish-management-accounting-information-system-3953.html

Impacts of Technological Advances: Case Study Questions

2012-02-03T11:17:00.001-08:00

Case Study Questions

Abstract:

Technological advances have impacted various areas of everyday life. Augmented reality has created more opportunities for marketing. The flash crash was caused by computers programmed to do high frequency trading. Innovative information systems track performance metrics for Valero Energy. Though these three topic areas seem very different, they all have cutting edge technology in common.

Case Study Questions

The case studies are centered around different types of relatively new technology and the impact that it has made. Augmented reality completely changes the way that products are marketed. High frequency trading has caused, and could potentially cause again, flash crashes that many cannot comprehend. Performance metrics can be tracked on innovative dashboards keeping executives in the know when things veer off the goal path. All of this new technology is changing the way we live our lives and do our business.

Reality Gets Better

1. The difference between virtual reality and augmented reality is that “virtual reality is a computer-generated, interactive, three-dimensional environment in which people become immersed” (Laudon & Laudon, 2012) whereas augmented reality enables the user to “maintain a presence in the real world” (Laudon & Laudon, 2012).

2. Augmented reality is more appealing to marketers than virtual reality because it gives them a wider range of possibilities in relation to the types of ads they develop.

3. Augmented reality is useful for real estate shopping applications because if you are walking around a neighborhood that you are interested in buying property in, applications have been developed that show you where property is available, right in front of your eyes. With augmented reality “a 3-D rendering of a condo tower appears to climb out of a magazine page when viewed with a smartphone's camera and screen (and) other real estate print ads are brought to life with clickable buttons and multimedia” (Roberts Jr., 2012)

4. Other working applications of augmented reality that I would suggest would be useful could be someone modeling clothes when you place your phone in front of folded ones in a store.

The Flash Crash: Machines Gone Wild?

1. The conditions preceding the flash crash involved fearful and uncertain investors and market that was “already down and trending even lower” (Laudon & Laudon, 2012).

2. The benefits of electronic trading are “speed, reduced cost, and more liquid markets” (Laudon & Laudon, 2012) and the use of algorithms that learn what will work in the market and “adjust their stock trading strategies” (Laudon & Laudon, 2012) based on what the market is doing.

3. The features of electronic trading and automated trading programs that contributed to the crash were the “computer selling algorithm that dumbed 75,000 contracts” (Laudon & Laudon, 2012) within twenty minutes triggering other HFTs that used algorithms to begin selling as well.

4. The only way that the flash crash could have been prevented would be if computer were never allowed to have control over buying and selling. When you give computers this type of control, no matter what the limitations are, there is always the potential for something to go very wrong. Unless humans are given back the power. The SEC’s Chairman Mary Shapiro was quotes saying “Can I guarantee we will never have another flash crash? No” (Thomas/Reuters, 2011).

Piloting Valero With Real-Time Management

1. The issues that needed to be addressed when developing Valero’s dashboard was ensuring that they were measuring the right thing, it limited how innovative they were, and an array of others “from backward-looking metrics and ill-advised goals to antiquated budgeting approaches and technophobic executives” (Henschen, 2009).

2. The COO of Valero “wanted to see real-time data related to plant and equipment reliability, inventory management, safety, and energy consumption” (Henschen, 2009) performance metrics displayed by the dashboard. The benefit of the information is that executives can receive timely information so they can take immediate corrective actions when plants stray away from the goals.

3. The information systems required for Valero’s dashboard are “SAP’s Manufacturing Integration and Intelligence application” (Henschen, 2009) and “SAP BusinessObjects Xcelsius software” (Henschen, 2009).

4. Valero’s dashboard is so effective at helping to pilot the company that it has “executive-level, refinery-level, and even individual system-operator-level dashboard views” (Henschen, 2009). It has been so successful that thousands of company are attempting to create systems similar to Valero’s.

5. Valero’s dashboard should not focus on things that it cannot control. If it is out of their hands, there is no sense in people worrying about it. They should focus on the factors that they are in control of so that they can identify internal issues and correct them in a timely fashion.

Recent technological advances in various fields have enabled us to excel in ways that before weren’t even imaginable. Innovative dashboards have enhanced business practices. Marketing opportunities have expanded due to augmented reality. Millions of dollars can be made by computers with high frequency trading (that comes with a price). Technology is evolving and impacting our lives each and every day.

References

Henschen, D. (2009, November 19). Enterprise Information Management. Retrieved from Smarter Execs Focus On Goals, Not Just Metrics: http://enterpriseinformationmanagement.wordpress.com/2009/11/19/smarter-execs-focus-on-goals-not-just-metrics/

Roberts Jr., G. (2012, January 16). inmanNews. Retrieved from Real estate get dose of augmented reality: http://www.inman.com/news/2012/01/16/real-estate-gets-dose-augmented-reality

Laudon, K. C., & Laudon, J. P. (2012). Management information systems: managing the digital firm (12th ed). Upper Saddle River, NJ: Pearson Prentice Hall.

Thomas/Reuters. (2011, May 5). MoneyNews. Retrieved from SEC's Schapiro: We Can't Prevent 'Flash Crash' Repeat: http://www.moneynews.com/FinanceNews/SEC-Schapiro-Prevent-Flash/2011/05/05/id/395298

Erik Erikson's Sixth Stage of Psychosocial Development: Intimacy versus Isolation

2012-02-02T10:05:00.001-08:00

The psychosocial conflict of intimacy versus isolation is the sixth stage of Erik Erikson’s psychosocial development theory. It usually occurs in 19-40 year old adults. The process specifically involves the formation of intimate and loving relationships. We seek out mutually satisfying relationships through marriage and friends. Erikson believes that “having a fully formed sense of self (established during the identity versus confusion stage) is essential to being able to form intimate relationships” (Cherry, about.com psychology, n.d.).

People who lack a sense of self have shown in studies to have more commitment issues than those who developed a strong sense of who there are. Depression, loneliness, and emotional isolation frequently accompany the commitment issues. Erikson notes that people who are able to develop close and committed relationships will be able to avoid loneliness and isolation throughout life. Successful development throughout this stage results in the experience of a deep level of intimacy. When we are unable to experience this intimacy “our world can begin to shrink as, in defense, we can feel superior to others” (Harder, 2002).

A good example of someone who has failed to develop intimate relationships on television today is the show House. House lives alone and has few friends, even lacking people who like him. “His behavior often borders on antisocial, but House is a brilliant diagnostician whose unconventional thinking and flawless instincts afford him a great deal of respect” (FOX, 2012). He feels superior and smarter than everyone he interacts with and exhibits all of the qualities that Erikson describes people who fail at intimacy have.

References

Cherry, K. (n.d.). about.com psychology. Retrieved from Itimacy Versus Isolation: http://psychology.about.com/od/psychosocialtheories/a/intimacy-versus-isolation.htm

FOX. (2012). Fox. Retrieved from House: http://www.fox.com/house/about/

Harder, A. F. (2002). Learning Place Online. Retrieved from The Developmental Stages of Erik Erikson: http://www.learningplaceonline.com/stages/organize/Erikson.htm

Erik Erikson's Fifth Stage of Psychosocial Development: Identity versus Role Confusion

2012-02-02T07:47:00.000-08:00

The psychosocial conflict of identity versus confusion is the fifth stage of Erik Erikson’s psychosocial development theory. It usually occurs in 12-18 year old adolescence “exploring their independence and developing a sense of self” (Cherry, n.d.). The age old struggle to try and fit in and figure out where we belong leaves the majority of teens insecure and confused. Your “identity defines who you are, what you value, and the directions you choose to pursue in life” (NCSU, n.d.).

Teens have a tendency to experiment playing a part in different roles, behaviors and activities as they struggle to establish their sense of self. This process is essential to a person developing a strong identity of them. It also provides them with a direction that they want their lives to go in. During this stage of Erikson’s theory “proper encouragement and reinforcement through personal exploration will emerge from this stage with a strong sense of self and a feeling of independence and control” (Cherry, n.d.). The alternative to this independence and control someone left unsure of themselves. This usually leads to confusion and insecurity in the future.

The television show Degrassi is a good example of this stage of development. The show is about teenagers that are growing up and trying to find themselves. “Every student who walks up Degrassi's steps enters an exciting, emotional, and unpredictable world -- high school” (Viacom International Inc., 2012). They experiment with different things, even when they know that they shouldn’t be, because they are searching for the own individual identity.

References

Cherry, K. (n.d.). About.com Psychology. Retrieved from Identity Versus Confusion: http://psychology.about.com/od/psychosocialtheories/a/identity-versus-confusion.htm

NCSU. (n.d.). WolfWikis. Retrieved from PSY 376 Identity vs. Role confusion: http://wikis.lib.ncsu.edu/index.php/PSY_376_Identity_vs._Role_confusion

Viacom International Inc. (2012). TeenNick. Retrieved from About Degrassi: http://www.teennick.com/shows/degrassi/about

Personality Disorders

2012-02-02T03:50:00.001-08:00

Freud’s personality theory provides the best explanation of how personality develops in an individual. Freud claims that each of us has three components to our individual personalities. The three elements together are responsible for our behavior. The Id is present in all of our personalities when we are born according to the theory. Our ego develops from the id. The superego begins to develop around the age of five. Each of the three elements relates specifically to different urges and feeling that we have. The id, for pleasure and gratification, the ego, for realistic expectations, and the superego, for “internalized moral standards and ideals” (Cherry, 2010).

Narcissistic Personality Disorder causes a person to feel a sense of entitlement. People with the disorder have very arrogant attitudes and lack any type of empathy towards others. They require an excessive amount of admiration from other to feel good about themselves. They usually exhibit traits similar to being very self-confident and having high self-esteem. “Narcissists crave attention” (Goncalo, Flynn, & Kim, 2010) , and are often manipulative and selfish. Psychotherapy is used to help narcissists relate better to others. It has been found that most people with this disorder avoid any type of therapy.

References

Cherry, K. (2010). About.com. Retrieved from The Id, Ego and Superego: http://psychology.about.com/od/theoriesofpersonality/a/personalityelem.htm

Goncalo, J., Flynn, F., & Kim, S. (2010). Corness Unitversity Digital Commons. Retrieved from From a Mirage to an Oasis: Narcissim, Perceived Creativity, and Creative Performance: http://digitalcommons.ilr.cornell.edu/cgi/viewcontent.cgi?article=1311&context=articles

Computer Crimes

2012-02-02T03:49:00.001-08:00

I believe that computer crimes are on the rise because everyday more and more people are becoming computer literate. The more people that there are using computers, the more criminal that there are going to be and therefore there would be more crime. I think that the security measures that we can take against these criminals are getting better and better everyday however, I also believe that the criminals can advance in their field just as quickly if not quicker than the people in the cyber security field.

Three different types of computer crimes that I am aware of are viruses, identity theft, and hackers. Viruses harm computers and take their information. People that steal the identity of others use it for “stealing money and obtaining other benefits through the use of a false identity” (Oak, n.d.). Hackers gain access to unauthorized communications pathways and can carry out crimes and make it look as if your doing it. I think that it is very important for the police to track down people that commit such crimes and make examples of them. The greater the consequences for these types of crimes, the less likely people will be to attempt them.

References

Oak, M. (n.d.). Buzzle. Retrieved from Types of Computer Crimes: http://www.buzzle.com/articles/types-of-computer-crimes.html

The Human Memory Model: How We Make Long-Term Memories

2012-01-27T10:51:00.000-08:00

There are four steps to the memory process. The four steps include encoding, consolidation, storage, and retrieval. Once we perceive a stimulus, it is then decoded within the cortex’s sensory areas. The hippocampus then combines the codes. Memories go from stimuli to the short term memory and are only committed to the long term memory after the synapses have been strengthened enough.

The encoding process produces an engram when it perceives stimuli. An external stimulus could be someone grabbing a hold of your arm and yelling at you. An engram is a change in the neurons of the brain. This change can be biophysical or biochemical. A connection is sent from the primary sensory and associative areas of the cortex and the rhinal/entorhinal cortexes by the hippocampus to the medial temporal lobe. The neural network that is made up of cortical synapses takes the associations being made and records them. This record is now a link to the specific memory. Semantic encoding is the process by which long-term memories are created.

The consolidation process utilizes long-term potentiation. Long-term potentiation is the process that physically changes the structure of neurons in the brain and results in long-term memory. The process causes “a long-lasting enhancement in signal transmission between two neurons that results from stimulating them synchronously” (Cooke, 2006). When we learn something the stimuli triggers neural networks to be created, altered, or strengthened. Neural networks are circuits of neurons in the brain made up of neurons. The neurons communicate via junctions known as synapses. New proteins are created inside the body of the neurons through synthesis. “Electrochemical transfer of neurotransmitters across synapse gaps to receptors (reinforce) communicative strength of certain circuits of neurons in the brain” (Mastin, n.d.). When they are repeatedly used, the synapse becomes more efficient thus physically changed by long-term potentiation resulting in long-term memories.

The storage process is passive. When the synapses are physically changed by long-term potentiation, the memory is stored there. They are continually reconstructed by the encoding process from elements that are scattered throughout other area of the brain. Storage is an ongoing process for our brains.

When you recall a memory, your brain reconstructs the elements required for the individual meeting. The recall process takes the memory from storage in the long-term area and moves it to the working memory. When you re-access the memory, a process almost identical to the encoding process occurs. When you are done recalling, it is taken back to storage in the long-term memory. This is known as re-consolidation.

Inferences can help people to improve their ability to learn. This involves relating other things that you already know, your schema, to what you are trying to learn. Emotional event are often recalled better than event that have no meaning to a person. Past and future memories can inhibit the ability of a person to recall memories. Distractions inhibit the ability to recall by slowing down the process. Distractions inhibit the ability to encode as well and could keep a person from being able to successfully recall the memory later.

In order to most efficiently be able to study, you should ensure that you have no distractions and are able to focus completely on what you are studying. Focus on concentration is very important as well, as “the ability to concentrate is one of the more important study skills you need to develop” (StudyTips, 2011). Staying organized can also help to keep you from being distracted. I is also very helpful when studying to try and use all types of memory to retain the information. Use visual aids and sounds when possible, make lists and create flashcards, anything that switches up the way you are studying. That way, you have a better chance of recalling the information because you have multiple locations in your brain that it is being stored and therefore, more chances to recall the info.

Retroactive interference occurs when a person attempts to remember something learned in the past. They end up being unable to recall the memory because something that was learned since that time obstructs the ability to correctly recall what you were initially trying to remember. Proactive interference occurs when a person is trying to recall recently learned material. The memory is unable to be accessed due to memories learned prior prevent it.

Fading is another type of forgetting that people experience. It occurs when we go to recall a memory and are unable to because we have not attempted to remember it for an extended period of time. The information is permanently stored in the brain but our link to it deteriorates. Fading can be avoided by actively restoring the memory.

Distortion is also a common type of forgetting and is “not really a separate type of forgetting, but rather a combination of the previous three types” (Purdue, n.d.). Distorted memories are misinterpreted by the person attempting to call them. Some of the memory is recalled accurately, while other parts are not. They are either completely forgotten or replaced with different parts of other memories.

References

Cooke. (2006). Oxford Journal. Retrieved from Plasticity in the human central nervous system: http://brain.oxfordjournals.org/content/129/7/1659

Mastin, L. (n.d.). The Human Brain. Retrieved from Long-Term Memory: http://www.human-memory.net/types_long.html

Purdue. (n.d.). Purdue Education. Retrieved from Forgetting: http://education.calumet.purdue.edu/vockell/EdPsyBook/Edpsy6/edpsy6_forgetting.htm

StudyTips. (2011). StudyTips.org. Retrieved from How to Improve Your Study Skills: http://www.studytips.org/

Decision Support System (DSS) vs. Management Information Systems

2012-01-25T12:12:00.001-08:00

A decision support system (DSS) is usually used by businesses. It is a computerized system used to combine integrated resources people can use for decisional purposes. It is capable of collecting data from an array of sources and presenting them in an organized fashion to the end user. Decision support systems are often turned into applications. The difference between decision support systems and management information systems is that DSS is “to predict the effect of potential decisions beforehand” (McGraw-Hill, n.d.) and management information systems is for informational purposes to plan and direct business.

The fundamental components of a decision support system are the database, the model, and the user interface. The database is a collection of all the pertinent data necessary for retrieval. The model sets up the context of the decision and the user criteria. The user interface is “the screen menus and icons, keyboard shortcuts, mouse and gesture movements, command language and online help, as well as physical buttons, dials and levers” (McGraw-Hill, n.d.).

At the Defense Logistics Agency where I work as a contract specialist, we procure state-of-the-art logistics and manufacturing systems in support of items and information technology systems critical for war fighting. These include decision support systems for On-Demand Manufacturing, military rations, chemical protective suits, and metal casting and forging. We use an enterprise business system for the procurements and it has functionalities that help in decision making during the pre-award process.

References

McGraw-Hill. (n.d.). Answers.com. Retrieved from Decision support system: http://www.answers.com/topic/decision-support-system

McGraw-Hill. (n.d.). Answers.com. Retrieved from User interface: http://www.answers.com/topic/user-interface

Emotional Intelligence in the Workplace

2012-01-19T11:53:00.001-08:00

Emotional intelligence is the way that a person perceives, reasons, understands, and manages emotions. This type of intelligence is thought to be a key factor in a person’s ability to “build strong relationships, succeed at work, and achieve your goals” (Segal & Smith, 2010). Our emotional intelligence development process continues throughout our entire lives. Someone who exhibits emotional intelligence can reduce their stress level rapidly, is connected with their emotions, communicates nonverbally, can use humor to deal with challenges, and utilizes confidence and self-assurance with defusing conflict.

Emotional intelligence is important because it “is the level of your ability to understand other people, what motivates them and how to work cooperatively with them” (Bressert, 2007).Emotional intelligence is thought to be a better indicator of future performance in the workplace than intellectual intelligence. “A study of Harvard graduates in business, law, medicine and teaching showed a negative or zero correlation between an IQ indicator (entrance exam scores) and subsequent career success” (Bressert, 2007). The emotional intelligence quotient is becoming increasingly popular in candidate selection in the workplace because it is a better indicator of how competent people are.

The four core abilities of emotionally intelligent people are self-awareness, self-management, social awareness, and relationship management. When someone has self-awareness, they are able to recognize the way they are feeling and know how those feelings affect thoughts and behavior. Self-awareness also demands the ability to know your strengths and weaknesses and have confidence in yourself. Self-management is having the ability to control impulsivity. Being socially aware means that you can access and understand how the people around you are feeling and are aware of their needs and concerns. Relationship management is how well you develop as well as maintain good relationships, clearly communicate your feelings, manage conflict, and work well in teams.

Becoming more emotionally literate is one way that a person can enhance their emotional intelligence. Instead of labeling people or situations, you should strive to label the way you feel about what is going on. It is also important to be able to distinguish the difference between your thoughts and your feelings. Phrases such as “I feel like...& I feel as if.... & I feel that” (Hein, 2012) are thoughts. A feeling begins simply with I feel… Analyzing your feeling and taking responsibility for them helps up to identify our emotional needs that are not being met. It is also important to validate the feelings of other and avoid people who invalidate you. Another way to enhance emotional intelligence is channeling anger into energy that you can put towards achieving a goal. Being empathetic towards others is one of the best ways to show your respect for them. Strive to listen to others and empathize with their feelings in place of advising, commanding, controlling, criticizing, judging or lecturing them.

When I took the self-administered EQ test on the Institute for Health and Human Potential website, I scored 54. Between 45-54 was described as having an emotional intelligence level that was very high. I felt that the test couldn’t be the greatest of indicators because the answers only ranged from strongly disagree to strongly agree. There also weren’t very many questions. It seemed very generic and I think a lot of people might see themselves as understanding or relaxed in high stress situations when they are not. I think that people’s perceptions of themselves would make them sound good if they took this test, even if they weren’t very emotionally intelligent. I think that an honest third party should be able to take the test about you and you would obtain a better reading of how emotionally intelligent someone is.

References

Bressert, S. (2007). Psych Central. Retrieved from What is Emotional Intelligence (EQ)?: http://psychcentral.com/lib/2007/what-is-emotional-intelligence-eq/

Hein, S. (2012, January 5). EQI. Retrieved from Developing Your Emotional Intelligence: http://eqi.org/summary.htm

Segal, P. J., & Smith, M. ,. (2010, September). HelpGuide. Retrieved from Emotional Intelligence (EQ): http://helpguide.org/mental/eq5_raising_emotional_intelligence.htm#authors

Information Systems Life Cycle

2012-01-18T10:15:00.001-08:00

The life cycle of a time entry system includes numerous steps to be successful. The first step to solving the time card issue would be planning. The goals that we are hoping to achieve need to be defined and we need to clearly establish what we are hoping to achieve when creating this system. The problems that we want to solve with the new system have already been laid out and the system development can begin.

Next, the project goals need to be turned “into defined functions and operation of the intended application” (Kay, 2002). It will also be necessary to analyze the needs of the end user. When these things have been completed, the system design begins. The features and designs are described in detail to include rules, layouts, process diagrams, and pseudo code.

The next step is implementation, or the writing of the actual code. Integration and testing comes next. This process works to get all of the bugs and kinks out of the system so that its ready to go live. Going live with the system is the next step in the life cycle process. Deploying the system that has been developed can be one of the biggest, most crucial steps in the process because the workforce that is using it must be eased into it.

The last step of the life cycle process is to perform regular and necessary maintenance on the system. This includes making “changes, corrections, (and) additions” (Kay, 2002). Maintenance continues until the system is no longer in use. Maintenance is very important to keep the system up to date and working as efficiently as possible.

References

Kay, R. (2002, May 23). Computerworld. Retrieved from QuickStudy: System Development Life Cycle: http://www.computerworld.com/s/article/71151/System_Development_Life_Cycle