Stefan Thomke

9-603-022 REV: OCTOBER 28, 2002 STEFAN THOMKE Bank of America (A) The banking industry is ripe for innovation. We need to grow through value creation and excellent service that is appreciated by customers as opposed to price alone. — Milton Jones, president, Georgia Banking Group â€Å"I wonder if we’re being ‘overrewarded’! † exclaimed Warren Butler to Amy Brady, the executive responsible for Bank of America’s Innovation & Development (I&D) Team in Atlanta, Georgia.As an executive in the consumer bank’s quality and productivity group, Butler led innovation and process change in Brady’s group, which was responsible for testing new product and service concepts for the th bank’s branches. In the company’s elegant 55 floor conference room on a day in May 2002, the two prepared for a team meeting on an important strategic decision that would affect how experimentation would be done in the I&D Market. Seeds of change wer e in the air at Bank of America.Indeed, earlier in the day, Butler had escorted an astonished visitor, a European banking executive, on a tour of some two dozen real-life â€Å"laboratories† in Atlanta. Each was a fully operating banking branch, yet in every location new product and service concepts were being tested continuously. Experiments included â€Å"virtual tellers,† video monitors displaying financial and investment news, computer stations uploading images of personal checks, and â€Å"hosting stations. † (See Exhibit 1 for a selection of experiments carried out in a single branch. Currently, the I&D team had 25 bank branches in Atlanta in its experimentation portfolio. Senior management, however, had now offered them additional branches across the country that could expand experimentation capacity by nearly 50%. This offer appeared a vindication of the I&D Market project, which had been launched as an experiment itself only two years earlier. This rewa rd posed some tough questions. Would increasing the size of its innovation laboratories aid or inhibit the group’s ability to develop new product and services? What would be the effect on the group itself?The issue of whether it was a dedicated research and development (R&D) operation or not had yet to be resolved. And, finally, what kinds of expectations would be placed on the group if its size were to increase so dramatically? ________________________________________________________________________________________________________________ Professor Stefan Thomke and Research Associate Ashok Nimgade prepared this case. HBS cases are developed solely as the basis for class discussion. Cases are not intended to serve as endorsements, sources of primary data, or illustrations of effective or ineffective management.Copyright  © 2002 President and Fellows of Harvard College. To order copies or request permission to reproduce materials, call 1-800-545-7685, write Harvard Business School Publishing, Boston, MA 02163, or go to http://www. hbsp. harvard. edu. No part of this publication may be reproduced, stored in a retrieval system, used in a spreadsheet, or transmitted in any form or by any means—electronic, mechanical, photocopying, recording, or otherwise—without the permission of Harvard Business School. 603-022 Bank of America (A) Bank of America: A Pioneer in BankingMany innovative banks have gone out of business, often because they deviated from the â€Å"best practices† followed by most. — Rick Parsons, executive vice president, Strategic Projects When Bank of America was formed in 1998 through a merger between California-based Bank of America and NationsBank of North Carolina, it could be proud of a long and rich history that spanned more than 150 years. Under its last CEO, the colorful but controversial Hugh McColl, the company had gone on a three-decade-long acquisition binge that resulted in a truly nationwide bank.In the fitting end to an era of hunting, McColl left his last annual meeting wearing cowboy boots and jeans on his way to a turkey shoot in Texas. Toward the end of the 20th century, Bank of America was the second-largest national bank with nearly 4,500 banking centers in 21 states, more than any other financial services company and with most of them in the high-growth belts of the South and the West Coast (see Exhibit 2 for a map of the bank’s regional market share). In the United States, the bank served 27 million households and two million businesses and processed more checks per day than the Federal Reserve System.Globally, it boasted over 140,000 employees across 190 nations, over $8 billion in annual revenues, $360 billion in deposits, and some $600 billion in assets (see Exhibit 3 for key financial data). Yet, increasing competition ensured that Bank of America could not rest on its laurels. Like many of its successful peers, its growth had been driven by cost reduction a nd consolidation. From 1985 until 2000, the number of U. S. banks had dwindled from around 14,000 to about 7,000. These still large numbers—especially when compared with there being only six major banks in Canada— reflected the highly competitive nature of the U.S. banking industry as well as its regional focus. Driving consolidation had been a realization that while service was local, products were national. Despite this realization, however, banks continued viewing financial services as commodities, and this bottom-line orientation did not make for an industry rife with innovation. In the estimation of Butler, a senior vice president and industry veteran, â€Å"People’s expectations for banks are very low; in fact, they’re used to being treated badly by banks. To meet the challenges of an increasingly competitive environment, Bank of America had started decentralizing its national operations and encouraged branch managers to undertake more responsibili ties. According to reengineering expert Michael Hammer, however, the era of acquisitions had left the bank with â€Å"the loopiest organizational structure I’d ever seen†Ã¢â‚¬â€organized partly by customer, partly by geography, and partly by product (see Exhibit 4 for a section of the bank’s organization). As CEO Kenneth Lewis put it, â€Å"We’d talk about customer satisfaction, then go out and buy that next bank. 1 For the new century, however, things would change. Fortune magazine observed: The hunter will become a farmer. â€Å"Organic growth† is the strategy, reduced earnings volatility and greater profitability the goals. The plan is to make more money from essentially the same customers by selling more services. In the huge Consumer & Commercial bank, which generated 65% of earnings, that means getting a bigger â€Å"share of wallet† by encouraging 1 T. A. Stewart, â€Å"BA: Where the Money Is,† Fortune, September 3, 2001. 2 B ank of America (A) 03-022 consumers to consolidate their banking and—the Holy Grail—bring their portfolios over from Fidelity and Merrill Lynch. 2 Few banks, however, had formal efforts under way that would generate the continuous stream of new products and services needed to grow organically. Only in recent years did banks start filing for patent applications. When innovation occurred, it did so only in specific areas: the Fifth/Third Bank in Ohio, for instance, innovated on the cost side, while Washington Mutual (WAMU) innovated on the service side.Many large banks had pockets of innovation that quite often simply remained that— pockets. WAMU, one of the more innovative U. S. banks, had aggressively started opening traditional as well as experimental branches, sometimes directly across the street from Bank of America’s I&D Market branches. Taking a cue from retailers such as department stores as well as coffee retailer Starbucks, WAMU started its Occasi o pilot program. A concierge at the front entrance and several casually dressed roving sales representatives carrying mobile handheld computer devices answered customer questions.Several strategically placed teller stations replaced the traditional monolithic teller counter. Play areas for children also provided parents more time for banking. The first five Occasio branches opened in Las Vegas in April 2000, and customers opened checking accounts at twice the rate of regular branches. 3 For most banks, however, little sense of urgency existed. The State of Innovation in Banking Our banking branches haven’t really changed much in the last hundred years. If Jesse James brought his gang here, he’d still know where to go for the cash. Al Groover, senior process design consultant and I&D Team design lead One of the first actions Lewis took when becoming CEO was to consult several outside executives in areas from e-commerce to process management on what they considered to be â€Å"best management practice. † â€Å"Process and competence will win,† insisted Lewis, who also announced a Six Sigma quality program to reduce errors and streamline processes. In his focus on operational excellence, Lewis tried to rectify a situation that, according to a leading financial consultant, could be best described as â€Å"banks are very good at being mediocre at a lot of different things. 4 Innovation, too, would require a revolution. That banks traditionally downplayed product and service development was reflected by a near universal lack of R&D departments. The comforting, stolid shadow of the three-piece-suited banker, after all, still loomed over most large banks. New products and services in the banking industry, if and when they came, generally arose from marketing departments, which lacked the formal processes, methodologies, and resource commitments that companies in many other industries took for granted.In fact, even inspired senior executive s with sufficient initiative could, through relatively informal channels, bring their own ideas to test markets. Although banks had IT departments, these primarily supported ongoing infrastructure changes in technology and software. 2 Ibid. 3 WAMM Web site at . 4 T. A. Stewart, â€Å"BA: Where the Money Is,† Fortune, September 3, 2001. 3 603-022 Bank of America (A) In the late 1990s, however, several converging forces led Bank of America to launch its formalized system for product and service development, the I&D Team.First, along with other industries, the bank began appreciating the value of continuous experimentation and testing in its efforts to grow through innovation. Second, Internet fever had nurtured a spirit of innovation everywhere, including the banking world. Third, banks began realizing that value creation had to be based on the voice of the customer to grow revenue and deepen customer relationships. Bank of America initially viewed the emerging Internet as a wa y to overcome geography. This led to a strategy of moving customers out of branches.As a result, according to Butler, â€Å"Sometimes we were downright rude in our attempts to get people out of our branches. But eventually we realized that people like dealing with people and therefore branches were our strongest base. † Frank Petrilli, president of TD Waterhouse, the country’s second-largest discount brokerage, also acknowledged that â€Å"branches are a crucial customer acquisition tool which solicits 30% to 50% of our clients through the 160 offices in the U. S. The branches are continuous advertising outlets, allowing us to spend only $58 per new account, compared with our online competitors that have cost up to $250. 5 The question then became how to change the role of the branches to balance customers’ needs for a human touch with the bank’s desire for cost-efficient, high-technology-based transaction platforms. The strategists at Bank of America re alized that such a balance could not be found overnight; nor, in a world of changing technologies, could solutions ever prove permanent. A dynamic test bed for experimenting with new banking concepts had to be found. The Innovation & Development Team VisionThe Innovation and Development Market is a test bed for creative ideas to increase customer satisfaction and grow revenues. — Amy Brady, senior vice president, I&D Team executive Every day, Bank of America processed 3. 8 million transactions—including more checks than the entire Federal Reserve System. A typical noncommercial customer entered a branch every nine days and used an ATM nearly three times a week. 6 Thus, even a 99. 9% success rate would still mushroom into over one million mistakes a year and expose consumers to problems ranging anywhere from paycheck deposit errors to bill mispayments.It was feared, therefore, that â€Å"experiment† and â€Å"mistakes† would be considered synonymous. Yet i f consumers wanted Swiss-watch precision for their money, they also craved Mediterranean warmth for their service experiences. At about the same time that WAMU was taking a page from successful retailers to create more inviting bank branches, so too was Bank of America thinking about how to experiment with the human dimension of its bank branches as well as the human-technology interfaces.To reduce risks of large-scale failure, the bank confined its experimentation to a set of bank branches eventually called the â€Å"I&D Market. † In the controlled environment of these laboratory branches, routine transactions could be handled efficiently while customers’ wishes for a good experience could be studied and experimented with. The bank could explore myriad questions: Could people’s waiting time in line be made more tolerable? Was there even a need for lines? Could technology-inexperienced customers relate well to American Banker, October 7, 1999. 6 T. A. Stewart, à ¢â‚¬Å"BA: Where the Money Is,† Fortune, September 3, 2001. 4 Bank of America (A) 603-022 using keyboards and other devices? How best could staff members coach customers about Internet banking options? The goal was to boost customer and staff satisfaction at bank branches, which would ideally boost revenue growth within a given customer base while secondarily lowering staff turnover. The original idea for the I&D Market came from different sources, including several senior executives. Proceeding with the Innovation & Development Market project was a no brainer,† according to Rick Parsons, one such executive. â€Å"What was trickier were issues such as execution and budgeting of the project. For execution-level leadership, we assigned Amy Brady, Rob Johnson, and Warren Butler, all managers with good track records of getting results on a day-to-day basis. † The team sought to establish a process whereby ideas could be generated, collated, and queued up for systematic , objective evaluation (see Exhibit 5 for its product and service innovation process).For the few ideas that made it through this â€Å"filter,† experiments would be designed and planned for the I&D Market branches. Successful experiments—determined on the basis of consumer satisfaction or revenue growth—could then be recommended to senior management for a national rollout To set up the new system for innovation, little upfront financial investment was required, as many team members worked part time on the project. Soon, however, the team grew to roughly a dozen managers, who often worked evenings and weekends.The 2001 budget allocation was $11 million, of which only $6. 3 million was spent on the team’s experiments. Management considered this allocation generous, even for a company with $8 billion in revenues. The company’s senior leadership resisted any attempts to carve out a â€Å"president-level† special budget for the innovation and pr ocess change team, arguing that, instead of enabling it to become another cost center, the group’s funding should be tied directly to the performance of the 25 I&D banking centers.These branches also â€Å"brought their own checkbook† and paid for part of the experiments themselves. Intensive initial debates had centered on whether the new group should operate as a stand-alone R&D center. Those in favor argued that a specific budget for new products and service development would protect the team from the day-to-day responsibilities of running a bank. Without such protection, the risk always existed that short-term market pressure would stifle long-term thinking and opportunities.It would also prevent comparisons between new concepts and mature products or even help prevent premature testing in live conditions. Thus, products and services under development could incubate properly without risking premature termination. After all, no automobile company would want a custom er to walk up to one of its dealers and drive away with an untested prototype car. And finally, creating an R&D group charged to tinker allowed for much more organizational focus on innovation rather than a group that was supposed to also show operating results.Many executives, however, felt that a separate R&D center would run the risk of becoming â€Å"too hypothetical and impractical. † Some feared that results from the I&D Market might then not prove duplicable elsewhere. Marrying experiments with real-world banking facilities would thus decrease cycle time for rollout. As Jones reflected on the thinking of the bank’s senior leadership: â€Å"We were really looking at being able to execute fast—so making a separate R&D center is harder. Furthermore, ideas in some R&D centers never get a chance to see the light of day. But the issue of dual operating and innovation responsibility was hardly settled. As one employee in a feedback seminar put it succinctly, â €Å"We are building a plane as we are flying it. † Indeed, the issue was still up in the air in May 2002. 5 603-022 Bank of America (A) The Vision at Work: Atlanta’s I&D Market Branches For a variety of reasons, Bank of America settled on Atlanta as the site for its I&D Market. The bank branches here boasted the most advanced communications infrastructure, with T1 and broadband communication lines installed.Atlanta also represented a â€Å"stable† market, with the bank’s last major acquisition there in 1996. Finally, Atlanta lay a stone’s throw from the bank’s national headquarters in Charlotte, North Carolina. Of its 200 branches in Atlanta, Bank of America initially gave 20 to the I&D Team. This hardly proved an imposition on the Mid-South Banking Group. The locations generally came from richer neighborhoods where customers were more computer literate and interested in a wider range of services.The I&D Team also replaced the conventional à ¢â‚¬Å"one size fits all† mentality with three different types of branches configured to satisfy varying customer needs: â€Å"express centers,† where consumers could quickly perform routine transactions; â€Å"financial centers,† where consumers could access more complex technologies and more highly trained associates for a wider range of services; and â€Å"traditional centers,† which provided conventional banking services, albeit with enhanced processes and technologies (see Exhibit 6 for a brief description of the banking centers).The Atlanta I&D Market included 5 express centers, 5 financial centers, and 15 traditional centers. The group unveiled its first remodeled branch—a financial center—in the posh Buckhead section of Atlanta at a cost of about $1 million, for mostly technology. The other branches were remodeled to one of the three branch types and reopened shortly thereafter. Customers entering any financial center were greeted by a host at the door—an idea taken from department and clothing stores. Customers no longer needed to sign in to see bank officers.At freestanding low kiosks, associates stood ready to perform transactions such as opening accounts, creating loans, retrieving copies of old checks, or, in some instances, even selling stocks and mutual funds. None of these associates had private offices. Customers could visit an â€Å"investment bar† with computers where, once online, they could bank, check personal portfolios, or just surf the Internet. Customers waiting for tellers could pass the few minutes in line watching television news monitors above the tellers’ desks or observing electronic stock tickers running along another wall.Some branches featured â€Å"investment centers† where customers, sipping complimentary coffee, could lounge on couches reading magazines, newspapers, or financial journals or hook up their personal computers. All these nontraditional items w ere, in fact, experiments. The flat-panel monitors above the tellers, for instance, represented part of the â€Å"Transaction Zone Media† experiment (detailed in a later section); the instant retrieval of old checks comprised the â€Å"ImageView† experiment; the investment centers and complimentary coffee, too, came under experimental scrutiny.All branches closely monitored customer reactions to these innovations through a variety of means, including customer satisfaction surveys and statistics on such factors as revenue growth, deposit growth, and number of services used by each customer. Prior to introducing these experiments into the I&D Market branches, the team actually rehearsed how the activity should occur. So, in a â€Å"prototype center† in Charlotte, North Carolina, people acted out how the host would behave as he or she handed off customers to specialists.They choreographed how a bank associate (not a specialist) might spend only 30 minutes with a cu stomer to set up a mortgage. To maximize the fidelity of these prototype rehearsals, actual specialists mimicked the intervening steps. When all the kinks were worked out in this rehearsal process, the experiment was launched in the â€Å"living laboratory. † The Walt Disney Company designed and taught them a â€Å"Bank of America Spirit† program—demonstrated in theme parks and taught through seminars as a service approach to other industries—which was a principal motivator of the team. 6 Bank of America (A) 603-022The staff at local branches put the â€Å"Bank of America Spirit† into action in different ways. They got to know their customers better, more personally. And the results were impressive. Bank teller Kemaly Jacques recalled: â€Å"One customer had been boycotting our branch for the past three months because of poor service; now he swears he won’t go anywhere else. † The host, a key figure who guided customers as they entere d the branch toward appropriate services, became a great success story, though at the outset the role confused some customers, particularly those with complex transactions. â€Å"Where do I sign in? many would ask. Host Kilah Willingham, who had worked her way up the organization from teller to loan officer, described the host’s role as follows: I spend up to five minutes probing customer needs. I also intercept people going toward the old-fashioned tellers and usher them toward our innovative stations [where â€Å"experimental† technologies were offered]. A lot of customers are wary of technological change, for instance, of having the camera on them at the virtual personal banker station. My role is to make them comfortable here. I like not knowing what’s coming up next; it keeps me on my toes.During the early months, however, planning and running experiments tied up tellers and associates in meetings for almost 30%-50% of their time (later this would drop to about 25%). On one occasion, a fill-in teller, providing temporary coverage during one of the meetings, mistakenly gave a customer a â€Å"dye pack,† a fake wad of dollar notes meant for use only during robberies. As the customer walked out, the wad started smoking in his pocket and exploded. The Bank of America Spirit, however, persevered. Hosts and tellers emerging from the meeting showed their service experiments to firemen arriving at the scene. â€Å"This is so cool! cried out one fireman before opening an account. Experimentation, Learning, and Measurement At the end of the day, the most critical aspect of experimentation and learning is measurement. Measurements will defend you if done right; otherwise they will inhibit you. — Milton Jones, president, Georgia Banking Group Of the many difficulties the team faced, one of the thorniest was resolving â€Å"how to† questions: how to gauge success of a concept, how to prioritize which concepts would be tested , how to run several experiments at once, and how to avoid the novelty factor itself from altering the experimental outcome.Moreover, according to Butler: â€Å"While we were building R&D capabilities, those controlling the purse strings thought we were doing just a one-time experiment. † Thus, the problem list included one last addition: how to defend the I&D Market itself from budget cuts. The team selected concepts to be tested on the basis of available funding, business fit, and business case. To some extent, just continuing with the evaluation process served as a natural filter for ideas. But with many ideas and concepts that needed formal testing, according to team managers Joann Donlan and Mark Lewis, â€Å"Even top-priority experiments need prioritization. As a result, the team started assigning priorities (high, medium, or low) based on the assumed impact to customers, and Brady and Butler made the final decisions about which product or service concepts to actually test. By May 2002, more than 200 new ideas had been generated, of which 40 made it to testing, 36 were successfully implemented and measured, and 20 were recommended or had been already rolled out nationally. Only four experiments eventually failed—and one of these became a â€Å"redefined† concept. 7 603-022 Bank of America (A)Central to the team’s innovation process was how quickly people could learn from experiments, and measurements played an important role. The group amassed considerable experience and mastery of the subtle factors that affected learning. High-fidelity experiments The team sought to ensure that its experiments mirrored reality, or possessed high â€Å"fidelity. † Concepts that worked only inside their branches, after all, had little value to senior management interested in the scale effect of national rollouts. But high fidelity also meant high cost and commitment, which was hard to justify when ideas were at an early stage.Sometimes , low-fidelity tests using small focus groups gave the team an alternative during the very early stages of idea assessment. Experiments requiring minimal human intervention, such as news monitors over the teller’s counter, for instance, would likely work just as well in regular branches as in I&D Market branches. But not all innovations might transfer perfectly in the course of a nationwide rollout. For instance, would staff in a regular branch provide the handholding and attention required to initiate technophobes to a virtual teller?In such cases, the insistence by upper management that experimentation occur in a live banking situation helped ensure high fidelity and confidence in the team’s learning. Minimize the effect of noise Isolating the effect of a particular experiment on a bank branch’s performance meant being clear on what that effect was in itself, minus â€Å"noise† factors. Such noise could arise from a variety of sources such as seasonal p erformance fluctuations and changing market or even weather conditions. To minimize the effect of noise on learning, the team made heavy use of two techniques, repetition of trials and experimental controls.First, repeating the same experiment at one branch or running it simultaneously at different branches averaged out the effect of noise and thus reduced the possibility of obscuring the changes that teams were interested in observing and measuring. It would also ensure that success of a given concept would not rely on factors unique to a given branch. Second, pairing up two similar branches, one with an experiment (the â€Å"intervention†) and the other running under normal conditions (the â€Å"control†), enabled the team to attribute differences between the branches primarily to the intervention itself.It could draw on controls from the I&D Market, or even from other branches in Atlanta or nearby regions such as North Carolina. The best controls, however, were like ly the very same I&D Market branches themselves in a before-and-after type of experiment; if properly done, this would help factor out the so-called Hawthorne effect. The Hawthorne effect referred to the implications of actually participating in an experiment and how that might affect its outcome. The team was aware this was possible, given the direct and indirect pressure on staff to perform. Willingham acknowledged, â€Å"We are spoiled.We get special corporate shirts, we get parties; every quarter we have special ‘let’s talk’ sessions. We associates can even contact the regional manager if we need. Other associates envy us. So we had better do well. † Rapid feedback The cycle time for any given experiment carried out by the I&D Team was specified at 90 days. This did not include a preliminary â€Å"washout† period of a couple of weeks during which the novelty for both staff and customers hopefully subsided. Obviously, shorter turnaround time for feedback would help experimenters learn and prepare modified experiments more rapidly.Occasionally, it became quickly evident after the first few days if a concept would flop or succeed. Only rarely, however, did the team remove flops prematurely. On one occasion the team canceled a mortgage loan program after just a 30-day trial, primarily because getting credit approvals took far too long. The early termination allowed for quicker revision of this experiment, leading to a successful mortgage program. Increase experimentation capacity The number of experiments a single branch could run depended on available floor space and personnel, among other things.Less capacity would force the team to cram more experiments into one branch. If no capacity remained, the team could be forced to 8 Bank of America (A) 603-022 do things sequentially, which, in turn, would slow the entire concept-evaluation process. If the team succumbed to the understandable temptation of cramming too many experimen ts in a single branch, it would be hard to analyze the contribution of each individual experiment—another signal-to-noise problem. A single branch might have as many as 15 active experiments running at any given time.If customers loved an experiment, however, it was left in the branch even after the 90-day trial period. This being the real world, after all, the branches could not simply pull the plug on something customers had grown to relish. Measurement team leader Scott Arcure admitted, â€Å"We often worry about changing too many chemicals in the mix and wonder about which one made it explode. As bankers, we’re not experts at this type of measurement. † The team planned to bring in a statistics expert to help sort out the effects of multiple variables.One of the bank’s outside research partners suggested moving to an entirely different market for further experiments. But the group was focused on its Atlanta market. With the customer satisfaction perce ntage higher than in traditional bank branches, some felt that capacity still remained for assessing additional experiments. In any case, Arcure warned that â€Å"the Hawthorne effect would spike again in any new bank branch. † The biggest problem with experimenting in a real-world laboratory was balancing innovation with a need for bottom-line success.Pursuing radical innovations would allow the team to explore entirely new possibilities; an incrementalist approach, however, allowed for improving current banking processes. Successful radical innovations would bring glory to the team. But home runs came at the cost of strikeouts. With its future not ensured, the team could simply not take outrageous chances. Many tests thus ended up validating ideas that were likely to succeed. Team members readily acknowledged such to be the case for host stations Transaction Zone Media and Bank of America Spirit.According to Teri Gann, a former regional executive, â€Å"Interestingly, and not surprisingly, many of our successes, such as the host station, have been simple and low cost. † The biggest impact so far came from Bank of America Spirit—technologically, a nonrevolutionary program transplanted wholesale from Disney. While the original vision called for a 30% failure rate, the actual rate in the first year hovered close to 10%. Butler commented, â€Å"We’re trying to sell ourselves to the bank. If we have too many failures, we just won’t be accepted.Currently, we may have failure within concepts, but not failure in concepts. † â€Å"We might tweak a process, but everything conforms to the status quo,† observed Wells Stanwick, Bank of America manager of channel strategy. â€Å"Could we try out a more radical concept such as providing branch offices similar to attorney offices in large office buildings for wealthy customers? † Deborah McAdams, banking center manager, agreed: â€Å"Let’s do something really i nnovative, such as trying out loan machines similar to automatic teller machines like they do in Japan.When I mention this, some people aren’t sure if I am joking. † Concepts that appeared intuitively obvious did not always prove so in reality. Such was the case for innovation and for financial payback. Team leaders wondered if a â€Å"breakthrough† product should be measured through its degree of innovation or through financial payback or both. According to Brady, â€Å"Our metric should be how an innovation affects the bottom line two years out, rather than looking for instant feedback [through customer satisfaction]. † Problems with assessing innovation soon surfaced.What might appear radical to one person, for instance a â€Å"mobile teller† to a technophobe, might prove less radical from a purely technical standpoint. Nor did the innovation team take financial performance into account, largely because of an anticipated lag of 18 months to 2 yea rs in going from concept to rollout beyond Atlanta. The I&D Market, instead, would settle on the proxy measure of consumer satisfaction. Many team members recognized the shortcomings of their measurement process. Gann stated, â€Å"I believe we’re doing the wrong thing by measuring the I&D Market staff on productivity, not innovation. But, she added, More learning comes from more radical experiments 9 603-022 Bank of America (A) â€Å"You can’t chase two rabbits at the same time. † Some team members pointed to WAMU as a possible benchmark, for it was â€Å"a competitor willing to change and willing to raise the bar. † The Transaction Zone Media Experiment A good example of the bank’s new innovation process at work was the Transaction Zone Media (TZM) experiment. Internal researchers, who â€Å"intercepted† some 1,000 customers at bank lines, noted that after about three minutes the gap between actual and perceived wait time rose exponential ly.Two focus groups with sales associates and a formal analysis by the Gallup organization provided further corroboration—and the TZM experiment was born. The team speculated, based on published psychology literature, that â€Å"entertaining† clients through television monitors above the lobby tellers would reduce perceived wait times by at least 15%. The team chose one enhanced â€Å"traditional center† for the TZM experiment and another one as a control branch so it could maximize learning from the experiment. In the summer of 2001, the team installed monitors set to the Atlanta-based news station CNN over teller booths in the branch.The team then waited for a week’s washout period to allow the novelty to wear off before measuring results for the subsequent two weeks. Results from the TZM-equipped branch showed that the number of people who overestimated their actual wait times dropped from 32% to 15%. During the same period, none of the other branches reported drops of this magnitude. In fact, the control branch saw an increase in over-estimated wait times from 15%–26% (see Exhibit 7 for results from the experiment). Though these were encouraging results, the team still had to prove to senior management that TZM could positively affect the corporate bottom line.To do so, the team relied on a model that used the easily measurable â€Å"customer satisfaction index† (based on a 30-question survey) as a proxy for future revenue growth. Prior studies indicated that every one-point improvement in a customer satisfaction index corresponded to $1. 40 in added annual revenue per household from increased customer purchases and retention. A banking center (branch) with a customer base of 10,000 households would thus increase its annual revenues by $28,000 should the index increase by just two points.Percentages generally ranged in the mid-80s in Atlanta’s I&D Market and in the high 70s to low 80s nationally. The team me asured an overall 1. 7% increase after installation of the TZM monitors. Sufficiently encouraged, it entered a second phase, to study and optimize the impact of more varied programming, advertising, and sound speaker parameters. While the benefits of the TZM program were laudable, the team now had to consider whether they outweighed the costs. Studies indicated that it would cost some $22,000 to install the special TV monitors at each I&D Market branch.For a national rollout, the estimated economies of scale would bring costs down to about $10,000 per site. Incentive and Compensation Issues: Tellers Do Not Like Change Another thorny â€Å"how to† issue the team faced was how to motivate its staff. Could—and should—the performance of employees who were part of continuous experimentation be measured and rewarded conventionally? At the Atlanta branches, Bank of America tellers earned about $20,000 a year; annual turnover averaged about 50%. The next step up from te ller was sales associate; people in this job helped 10 Bank of America (A) 603-022 ustomers start up savings or checking accounts, fill out mortgage applications, notarize documents, and entice customers with new services. At I&D Market branches, some associates could serve as hosts—making many decisions without bringing in the branch manager. Some 30%–50% of associates’ compensation derived from performance bonuses based on a decade-old point system that used sales quotas—where points varied according to product, customer satisfaction, local market demographics, as well as managerial discretion. Given this system, associates were tempted to ignore customers’ actual needs. For instance, they would encourage customers to open up a checking account, which yields one point, rather than a savings account, which yields none,† said an internal financial consultant. For the first several months, the I&D Market maintained the conventional incentive s cheme. The sales associates seemed to relish the additional pressure. But it soon became apparent that they would have to spend as much as a quarter of their time in special training sessions, not to mention â€Å"alternate† time working as hosts, an experiment that yielded no bonus points.The staff, thus, began feeling disadvantaged by their rewards as hosts, since they faced the same monthly quota of points despite having less time with customers as part of an actual selling activity. For some, however, being part of the experiment proved reward in itself. â€Å"I would not go back to my old job,† said one associate who looked forward to working every morning. â€Å"It would be like stepping several years back in terms of technology and service. † Annual â€Å"Bank of America Spirit† motivational sessions with vibrant music and motivational speakers reinforced this sense of exclusivity.Yet cracks in the prevailing incentive scheme began showing. â€Å" Let’s be realistic,† one sales associate admitted, â€Å"you can’t be happy all day long; sometimes you have to fake it. † In January 2001, senior management switched associates in all 25 branches to fixed-incentive compensation. Most of them welcomed the change, which added to the feeling of being special. It also represented a commitment from top management to the experimentation process. But not all staff thrived under the new fixed incentives.One executive complained that â€Å"those in the I&D Market branches now thought they didn’t have to chin to the same level as others. † Another manager had to reassign an associate â€Å"since that person now sat passively at a desk; the team mentality of working for the customer proved foreign to her. † With all the attention and resources dedicated to the I&D Team, some senior executives echoed a growing impatience that it was time â€Å"to pay the piper. † Resentment from personnel in other conventional branches might also have fueled this feeling.The group already enjoyed more resources than other branches, and there was a fear that different incentive schemes would remove them further from the daily realities of banking. There was also uncertainty whether the concepts tested in prototype form would work nationally because of different market conditions. As Allen Jones, a regional executive, pointed out, â€Å"If a test is successful only under fixed-incentive schemes, then we can’t roll it out elsewhere. † With growing discomfort, senior management switched the staff back to the old point-based incentive system after just a six-month trial.Not surprisingly, with this about-face the behavior of the staff reverted as well. Hosts, for instance, became reluctant to send customers over to insurance agents because they got no points for such referrals. On two occasions, in fact, supervisors witnessed a host undertake entire transactions just to make his points quota rather than direct customers to associates. The about-face also led one staff member to question Brady about senior management’s commitment to the I&D Market vision. What concerned Brady and Butler the most, however, was the impact of incentives on the learning and quality of in-branch experiments. 1 603-022 Bank of America (A) First-Year Performance I see the following challenges for the I&D Market: ownership, evaluation, and continued support in a changing environment. The solution is to highlight successes, have a good batting average, rapid experimentation cycles, and maintain awareness at senior management level. — Milton Jones, president, Georgia Banking Group By traditional banking measures, the I&D Market performance appeared less than stellar. Overall deposit growth in 2001 stood at just 0. 5%, compared with 3. 7% growth in other Atlanta branches.In terms of revenue, however, I&D branches did about 10% better than traditional branches. Some ex periments proved quite effective; for instance, a â€Å"loan solutions† experiment generated an extra $700,000 in the first quarter in all 15 participating I&D branches combined. With all additional costs factored in, however, the I&D Market was not, at least on a pilot scale, a winning proposition. The team therefore wondered about how senior management would react to its performance in an environment where many programs throughout the bank were being axed.Were comparisons with traditional benchmarks fair, given its mission of being the bank’s product and service development laboratory? Despite just a slight rise in customer volume, many associates observed a larger spike in customer satisfaction, with some customers now coming from longer distances just to bank at the new branches. Another promising trend not captured by traditional measures involved personnel turnover. Except for an initial turnover spike, annual teller turnover had dropped from 50% over the past th ree years to 28%.In the last quarter of 2001, annualized teller turnover had dropped to as low as 20%, but it was unclear how much of this stemmed from employment uncertainties in the aftermath of the terrorist attacks on September 11, 2001. At the same time, some senior executives viewed the I&D Market as the crown jewels of the Atlanta branches. The bank offered tours of its gleaming prototype facilities to customers, Bank of America executives, visitors from other industries, and even competing banks. â€Å"Everyone’s eyes are on us,† admitted Allen Jones. â€Å"Just last week, one of the bank’s top executives visited us. In 2001 the I&D Team received an additional five branches as part of a corporate reorganization that would increase each regional manager’s branch portfolio. While these measures increased operating budgets, they did not boost the research budget for experimentation and testing. Brady and Butler wondered how to deal with the unexpect ed â€Å"reward. † Some people even suggested leaving these five new branches untouched to serve as additional experimental controls. Ultimately, the five branches joined the ongoing experimental portfolio, bringing the total to 25. The new branches added much-needed experimentation capacity.Operationally, however, taking on additional branches stretched the team’s efforts thin, since it required staff retraining and the setup of additional experiments, let alone all the minor logistics of managing branches that literally involved running among them all day long. With the potential drag of these branches on overall portfolio performance, the team also worried about increased corporate pressure for positive results. A Vote of Confidence? â€Å"We had a good first year,† Brady said as the last of the small group took their seats at the conference table overlooking downtown Atlanta. [The year] 2001 was our year to prove the I&D Team vision; 2002 is our year to grow up. At the end of this year I will have to restate our case, but 12 Bank of America (A) 603-022 hopefully to double funding. † The I&D Team had been one of the few projects to survive companywide cuts, albeit with a smaller budget. â€Å"We still make a small profit in our branches,† Brady added, â€Å"and potentially, this could cover our salaries, but it is too early to say. † Next, Brady explained how the bank’s senior leadership had offered the group yet another â€Å"reward† of additional branches across the country.These branches could expand experimentation capacity by some 40%–60% and take the strain off the 25 branches that were piling up so many experiments. But only about half the team responded to the news with smiles—just as Brady and Butler had expected. The team had debated almost since inception the use of external control branches from North Carolina or even other Mid-Atlantic or East Coast regions. Some felt that geo graphy did not matter in this Internet age, as long as demographics, customer profiles, and size of banking centers were comparable.Others, such as Stanwick, disagreed: â€Å"The prospect of using, say, North Carolina branches as controls for our Atlanta Innovation and Development Market scares me to death. † Those in favor of taking on the new branches pointed to the limited experimentation capacity and the increasing testing backlog. In 2002 alone, 26 new experiments were added to about 25 on-going tests carried over from 2001, bringing the number of active experiments to more than 50 (see Exhibit 8a for the group’s growing idea pipeline).They argued that more experimentation capacity allowed for faster evaluation of ideas through the running of more tests simultaneously and reduced feedback times because of potentially lower capacity utilization (see Exhibit 8b). Alternatively, the bank could run fewer simultaneous experiments and obtain cleaner and more reliable re sults. They further noted that the team by now had gained much experience in running experiments. In any case, it took the same time to design concepts for one center as for 10.Having a larger portfolio of branches might also make scale-up and national rollout of successful concepts easier and quicker. By making a big splash within the corporation, the I&D Team could win greater prominence. Because the offered branches were underperfomers, the team would look good in case of turnarounds but lose little if these new branches failed. Those against taking on the additional branches argued that the current 25 branches (or even fewer) in the portfolio were optimal. Taking on five branches within Atlanta had been difficult enough.Ten additional branches would be difficult to manage even if they were all in Atlanta. How much harder would it be for Atlanta managers, who were already stretched thin, to simply march into another branch and say, â€Å"Hi, we’re here to test. † Sp ecifically, some pointed out that associates in other states such as California appeared more individual than team oriented. Experience had also shown that associates would need to spend a quarter of their time undergoing additional training. In Atlanta, increased demands on tellers and associates had led to an initial rise in turnover (before eventually declining).Who could predict teller and associate turnover in a different geographic area? Some executives further noted that a larger I&D Market would increase the drag on the balance sheet, potentially stifling innovation. Too large a market might also confuse customers using more than one branch. Brady and Butler jotted down the rapidly flying ideas. Soon they would formulate a recommendation to the bank’s senior leadership about whether to accept new branches into its experimentation portfolio. One thing that stuck in both their minds was, ironically, â€Å"failure. In particular, the need for failure so as to generate m ore learning. Failures had been few and far between so far—indeed, the last failure was that of a mortgage loan experiment whose post-mortem analyses indicated â€Å"red tape† as the cause, that is, too much paperwork at the back end. Hardly a â€Å"revolutionary† experiment, thought Brady; hardly something—even if it had worked—remarkable. For both Brady and Butler, the words of their superior, Jones, an enthusiastic champion of their efforts, rang loud: â€Å"So far, most of our experiments have been successful.Perhaps we don’t fail often enough. † 13 603-022 -14- Exhibit 1 Examples of Selected Experiments in Atlanta’s Buckhead Financial Center Media Wall Main Stock Ticker Assisted Work Station Self-Service Internet Tool Host Station Source: Bank of America. 603-022 -15- Exhibit 2 Bank of America’s Regional Deposit Market Position and Share (consumer and commercial banking) Source: Bank of America Web site, . Deposits are as of June 2001. 603-022 Bank of America (A) Exhibit 3 Selected Financials and Operating Data (dollars in millions, except per-share data)Bank of America Year Cost of goods sold Selling and administrative expenses Research and development expenses ROA ROE Market value Total interest income Total interest expenses Net interest income Provision for loan losses Net interest income after provision for loan losses Other Income Salaries, occupancy, and equipment Depreciation Total other expenses Pre-tax income Income taxes Income before extraordinary Items & discontinued operations Earnings per share basic from operations Earnings per share diluted from operations 2001 22,290 12,718 n. a. 1. 14 98,158 38,293 18,003 20,290 4,287 16,003 8,564 12,718 1,732 14,450 10,117 3,325 6,792 4. 8 4. 71 2000 27,351 12,255 n. a. 1. 2 15. 8 74,025 43,258 24,816 18,442 2,535 15,907 9,920 12,255 1,784 14,039 11,788 4,271 7,517 4. 77 4. 72 1999 20,906 12,281 n. a. 1. 2 17. 8 84,179 37,588 19,086 18,237 1,820 16,417 9,996 12,281 1,917 14,198 12,215 4,333 7,882 4. 77 4. 68 Source: Compustat. 16 603-022 -17- Exhibit 4 Section of Bank of America’s Organizational Chart Ken Lewis Chairman and CEO Consumer/ Commercial Bank Banking Center Channel Commercial ChannelSmall Business Banking Channel Premier Channel MiddleMarket Treasury Management Quality & Productivity (Milton Jones) Consumer & Commercial Bank Credit Processing Mid-South Banking Group Banking Center Channel Support Liability Risk Management Network Strategy / Location Planning Innovation & Development (Amy Brady) (Warren Butler) Source: Bank of America. 603-022 Bank of America (A) Exhibit 5 The I&D Market’s Product and Service Innovation Process and Activities 2. Planning & Design 5. Recommend 1. Idea Conception The Innovation Process 3.Implement 4. Test ! Accepts, implements, and tests ideas and concepts (â€Å"experiments†) ! Optimizes speed to market and cost ! Coordinates activities and decisions thro ugh stages Market Rollout = Go / No Go 1. Idea Conception Conceive Ideas Input: Ideas/Info Output: Updated Idea Queue Desired outcome Assess Ideas Input: Updated Idea Queue Output: Approved Ideas Decision Ideas Input: Approved Ideas Output: List of Prioritized Ideas Success factors Key measures Desired outcome Success factors Key measures Desired outcome Success factors Key measuresInnovative ideas generated through internal and external sources Bank awareness and commitment # of total ideas % of approved ideas Rapid design, build and rollout planning Minimal planning time Timing and quality of design Cycle time for design types Ratio of redesigns Successful implementation of ideas Successful integration Zero market overload Cycle time Market readiness On-time implementation Stable operating environment for testing of new concepts and ideas Fast feedback of results Meeting test and mkt. oals Test cycle < 90 days Operating results Idea evaluation and national market rollout Quality r ecommendation package Cycle time Clarity/completeness 2. Planning and Design Assign and Scope Input: Prioritized Ideas Output: Design Needs Complete Design Input: Design Needs Output: Design Plan Build Rollout Plan Input: Detail Design Output: Rollout Plan 3. Implement Develop Test Plan Input: Individual Rollout Plan Output: Integrated Rollout Plan Implement Idea Input: Integrated Rollout Plan Output: Implemented Ideas 4. Test Manage the Market Monitor PerformanceInput: Output: Implemented Ideas Data Results Desired outcome Success factors Key measures Desired outcome Success factors Key measures Report Results Input: Output: Data/Research Test/Mkt Reports Conclusions Improve I&D Process Input: Process/Output Measures Output: Enhancements 5. Recommend Complete Recommendation Input: Idea Test Results Output: Recommendation Review/Approve Recommendation Input: Recommendation Output: Approval Communicate Recommendation Input: Approval Output: Communication Source: Bank of America. 18 B ank of America (A) 603-022 Exhibit 6Banking Branches in the Innovation and Development Experimentation Portfolio Financial Centers (5): Provide ability to advise across product line with expanded people, technology, process, and environment capabilities Express Centers (5): Provide fast, friendly, convenient access for routine transactions with self-directed options and teller services Traditional Centers (15): Provide traditional banking products and services with enhanced processes and technology Source: Bank of America. 19 603-022 Bank of America (A) Exhibit 7 Data from Transaction Zone Media (TZM) ExperimentThe TZM Experiment: ! Flat-panel monitors above bank tellers broadcast news for people waiting for service. ! Do such customers perceive shorter waiting times to service? ! Are such customers more satisfied with their banking experience? Actual versus Perceived Waiting Time (Customers who wait > 5 minutes) D iffe re nce 8. 16 Pre-Tes t 6. 17 P erc eived Tim e A c tual Tim e E xperimental Site: 32% 7. 04 Post-Test 6. 14 Tim e (m in) 0 2 4 6 8 10 15% ! Prior to installation of TZM, customers who waited longer than five minutes significantly overestimated their waiting time (32%). After installation, overestimates for the same customer group dropped to 15%. Control Branch: 8. 48 Pre-Tes t 7. 38 P erc eived Tim e A c tual Tim e 15% ! No experimental intervention was carried out during the observation period. ! Control branch had very similar customer demographics to experimental site. ! During the observation period, overestimates actually increased from 15% to 26%. 9. 27 Post-Test 7. 37 Tim e (m in) 0 2 4 6 8 10 26% Source: Bank of America. 20 Bank of America (A) 603-022 Exhibit 8a List of Product or Service Concepts Waiting to be TestedJanuary 13 (4) (10) 10 0 10 (7) -8 (7) -9 February 5 (1) (6) 6 0 6 (1) +29 March 27 4 (1) 1 0 1 (20) -21 April 3 0 (4) 4 0 4 (5) +16 May 27 0 (6) 6 0 6 (40) +7 Total 75 (1) (27) 27 0 27 Process Measure Inflow of new ideas be fore assessment* Ideas put on hold/reactivated Assessments completed — recommended for design/testing — not approved Ideas moved to design/testing New ideas discontinued (before or during assessment) Change in idea backlog** * New ideas come from brainstorming workshops, employee input, etc. * The January 1, 2002, backlog of new ideas awaiting a decision (assessment or discontinuation) is about two months. Source: Bank of America. Exhibit 8b Waiting Time Waiting for a Resource According to queuing theory, the waiting time for a resource increases gradually as more of the resource is used. But when the utilization passes 70%, delays increase dramatically. 0 40 50 70 80 90 100 60 Percent of Resource Utiliza tion Source: S. Thomke, â€Å"Enlightened Experimentation: The New Imperative for Innovation,† Harvard Business Review, February 2001. 21

Poetical inspiration Essay

Betjeman writes about a variety of places for example rural, urban, seaside etcetera. The two poems I have chosen are Slough and Middlesex. In contrast to Slough, Middlesex is more of a gentler poem, which evokes Betjeman’s memories of how rural Middlesex used to be. Betjeman has no memories of Slough but knows he detests it. In Slough Betjeman describe show fake the city is. In Middlesex he tries recollect his memories of the village. Slough seems to keep its rhythm throughout the poem where as in Middlesex the rhythm is fast but then slows down half way through. One can clearly see that Betjeman does not like Slough as he says in the first line, ‘Come, friendly bombs, and fall on Slough It isn’t fit for humans now,’ ‘Friendly bombs’ is definitely a contrast because bombs cannot be friendly. In this case the bombs are friendly because according to Betjeman Slough deserves to be bombed because it is so awful. The verse has a jaunty rhythm. Slough is not worth saving. One can clearly see his hatred for Slough in the first verse. He wants the bombs to blow up Slough so there is nothing left mostly because of all the canteens, which serve tinned foods. In the next verse, Betjeman is saying that we are becoming artificial because we are eating artificial food; there is no more fresh food to be eaten. One can see this view in the next verse: ‘Come, bombs, and blow to smithereens Those air-conditioned, bright canteens Tinned fruit†¦ Tinned minds, tinned breath. ‘ He now has gone from talking about the town and now talks about the food sold in the city, how that’s changed from being natural to tinned which is the new ‘now’ food. One can almost feel Betjeman’s anger because Slough has changed into such a depressing town. He makes the point that it should be bombed because it is so awful. In the fourth and fifth verses Betjeman talks about how much he hates capitalists, how they always cheat and win. One can tell this as he describes the man as repulsive. He then wants them to suffer as they cause so much pain to women as said in the fourth verse: ‘†¦ Washes his repulsive skin In women’s tears,’ He wants the bombs to fall on them and make them experience pain instead of the women one can see this because he says in the fifth verse: ‘†¦ And smash his hands so used to stroke†¦ And make him yell. ‘

A cross cultural management study on Toyota

A cross cultural management study on Toyota The aim of this paper is to identify what role culture has played in the organizational structure and management technique of Toyota. Toyota is now the world’s leading automobile industry, knocking out rivals car maker; General Motors (Marr, 2009). The Toyota Motor Company was established in 1937 and 30 years later it entered the US market in 1967. By 1980, the company already had about 20% of the US car market as the indigenous car companies started experiencing customer dissatisfaction. The company based its entrant strategy into the US on the following; Fuel efficiency as compared to ‘gas guzzling’ American cars Environmental friendliness Superior build quality The introduction of the luxury-car line The real reason for the company’s success nevertheless was based on the introduction of Japanese style of production, operation and management. According to Liker and Morgan (2006), management principles must extend beyond the shop floor as they do at Toyot a. The ‘Toyota Way’ is a set of standards that harness the Toyota (Japanese) culture. These standards are applied by the Japanese in virtually all their dealings. Although they are moderate by nature hardly showing emotions, they are still very thorough and they apply the successful cultural traits in almost everything they do. The most important aspect of Toyota America is the techniques the company has used to stay successful given the obvious cultural differences between Toyota Japan and its biggest foreign subsidiary. The Japanese and the Americans have distinctly different business cultures however; the company has been able to work in harmony for decades. The major differences are; communication skills, winning attitude, methodology of maintaining strategies etc for both the countries – Japan and United States. Thus, we can say that while establishing a new company in host country culture is highly important. HOME-COUNTRY BUSINESS VALUES (JAPAN) Managerial Autonomy and Long-term Planning Very often, Japanese employees are engaged to the companies for ‘lifetime employment’. It is therefore probable that managers are not pressured to meet requirements financially and employee related. Corporate Rigidity and Hierarchy Japanese companies like Toyota are very hierarchical in nature and as such have distinctive and autonomous power bases. The roles of top managers are defined and incline towards strategic development of the company. The business unit managers are the ones responsible for initiating and supervising new projects. Participatory Decision-making The practice of exploring ideas of employees by senior management is known as Nemawashi in a given project. The idea behind the Nemawashi is to obtain participation of all employees in the decision-making process. The Japanese style of management is a bottom-up approach as compared to the rather autocratic top-down style of management. HOST-COUNTRY BUSINESS VALUES (UNITED ST ATES) Low Context There is more or less an uncongenial nature of communication in American organizations. Expectations of employees are communicated in competency statements or the criteria of their performance. On the other hand however, the Japanese may be more contained in their communication. Individualism Employees and indeed managers in the United States are often defined by their personal achievements and place little importance in group achievements. Americans also do not place much value on trust as they are likely to engage in business with strangers not necessarily friends or family unlike their Japanese collectivist counterparts.

Classifications Of Drug Actions Research Paper Example | Topics and Well Written Essays - 1000 words

Classifications Of Drug Actions - Research Paper Example This plant develops in the Andes area of South America. Diverse chemical procedures create the two principal forms of cocaine: Powdered cocaine - regularly referred to in the city as "blow" or "coke† - breaks down in water. Users can inject or grunt powdered cocaine. Break cocaine - normally referred to in the city as "rock" or "crack† - is made by a chemical procedure that makes it in its "freebase" structure that can be smoked.As they come down from their cocaine high, certain users encounter temporary unpleasant reactions and after effects, which may include agitation, anxiety, irritability, restlessness, and insomnia (Streufert, 2013). During this "rebound" period, confusion, hyper arousal, suspiciousness, and other components of paranoid thinking may also appear (Streufert, 1993).Under the best possible natural circumstances, people report that cocaine elevates their capacity to focus, increments sexual energy, expands their amiability and reductions any previous tim idity, strain, weariness, dejection, or fatigue. Numerous individuals feel chattier, more strongly included in their connections with others, and perkier and unconstrained when high on cocaine. Down from their cocaine high, a few users experience brief unpalatable responses and delayed consequences, which may incorporate eagerness, tension, unsettling, touchiness, and sleep deprivation. Amid this period, suspiciousness, perplexity, hyper arousal, and different components of paranoid deduction might likewise show up.

FASB Standards Overview Essay Example | Topics and Well Written Essays - 1250 words

FASB Standards Overview - Essay Example The essay "FASB Standards Overview" talks about the FASB, and particularly Statement No. 116, in which over the vociferous objections of many of its constituent not-for-profit organizations, decided that unrestricted pledges should be reported as revenue in the period received. They should measure the pledges at â€Å"the present value of estimated future cash flows using a discount rate commensurate with the risks involved†. They should take into account both anticipated bad debts and the time value of money. If they establish an allowance for uncollectible(s), then they should use a risk-free discount. If not, then they should use a higher rate-one that takes into account the risk of being unable to collect the pledge. They should not both establish an allowance for uncollectible(s) and adjust the discount rate for risk. That would cause the default risk to be accounted for twice. Entities need not discount pledges to be collected within one year. To avoid recognizing contri butions as revenue before they are available for expenditure, not-for-profits should consider pledges of cash to be received in future period as subject to time restrictions. The FASB concluded that by promising to make payments in the future, donors implicitly restrict the donated resources to support of future, not current, activities. The recipient organizations should classify them as temporarily restricted. When the cash is received and available for expenditure, they should release resources from the temporarily restricted category.... Contributions also include unconditional promises-that is, pledges- to give those items in the future. Thus, pledges are regarded as contributions, although they exclude conditional promises to give these items in the future. A conditional promise depends on a specified future and uncertain event to bind the donor. For example, a university alumnus may pledge funds to construct a new physics laboratory if the university is successful in winning a government research grant. Contributions must be distinguished from exchange transactions. A contribution is a transfer of assets in which the donor does not expect to receive equal value in return. An exchange transaction is a reciprocal transfer in which each party receives and gives up resources of commensurate value. For example, if a private corporation were to give a not-for-profit research foundation funds to study the cause of a disease with the expectation that the results would be published in a scientific journal, the transaction would be considered a contribution. If, on the other hand, it gave the funds with the contractual agreement that it would have the rights to resultant patents, then the transaction would be an exchange transaction. The difference between the two is not always obvious. When people join the local Friends of the Library Association, do they do so to support the library's scholarly activities or to benefit for the right to attend member-only lectures Do they join the American Automobile Association to promote auto safety and good roads or to obtain emergency road service and travel directions Do they join the AARP to advance the interests of senior citizens or to take advantage of low-cost life and auto insurance

The Biblical Model for Discipleship Essay Example | Topics and Well Written Essays - 1000 words

The Biblical Model for Discipleship - Essay Example Applying Paul’s ministry to this week’s lesson on the â€Å"Biblical Model for Discipleship†, I have realized that obeying God and being a faithful servant of His is simple. It can basically be summed up to – A change of heart, a change of life. According to Michael Mitchell, in his book, â€Å"Leading, Teaching, and Making Disciples†, the Biblical model for discipleship could be achieved in as easy as four steps – Accepting God’s words; Listen and Apply; Study God’s word to gain more understanding; and lastly, Walking in the ways of Good Men (Mitchell, Michael R., Leading, Teaching, and Making Disciples). In studying the book of Philippians, a book written by Paul in his journey to win the people of Philippi to God, we can see Paul’s practical approach in ministering to the Philippians that are as 1 practical as the four steps of discipleship suggested by Michael Mitchell. To get a clearer background of what he did, it i s best to look at the verses of Philippians 4: 1-2 which says, â€Å"Therefore, my brothers and sisters, you whom I love and long for, my joy and crown, stand firm in the Lord in this way, dear friends! 2  I plead with Euodia and I plead with Syntyche to be of the same mind in the Lord.† (Bible Gateway, Philippians 4 NIV). We can see that Paul started his teaching to the Philippians by directing them to having a heart and mind that is in line with God’s will. We all know that our hearts and minds direct us towards certain actions that may or may not be pleasing to God. The danger of sin only happens when we set plans in our lives without consulting God first. Thus, Paul urges the Philippians here to start their walk with God by teaching their hearts and minds to get to know who God really is and what He wants us to do, so obedience would be easier and purposeful, knowing that despite the rocky roads you are sent to take, you know you are on your way to giving God the glory He deserves. This complements the first model of discipleship which is to accept God’s word and having faith to do it. Also, in Philippians 4: 5-7, that says, â€Å"Rejoice in the Lord always. I will say it again: Rejoice! 5  Let your gentleness be evident to all. The Lord is near. 6  Do not be anxious about anything, but in every situation, by prayer and petition, with thanksgiving, present your requests to God. 7  And the peace of God, which transcends all understanding, will guard your hearts and your minds in Christ Jesus†, we can see that Paul encourages the Philippians to listen and apply God’s teachings even when it seems impossible or unreasonable at times, parallel to Mitchell’s second model for discipleship. We all know that in our Christian life, it is easy to hear God’s word and 2 accept them as truth. However, the challenge for us is greatly seen in how well we stick to what we know and actually obey God despite persecutio ns, inconvenience, and doubt. Today, especially when the world presents so much good things that are not necessarily pleasing to God, the only way we can fight temptation is to cling onto God’s word and promises, and rely on His grace to help us withstand it all. To sum up Paul’

Difference between IBM and CA Technologies in term of their Technology Research Paper

Difference between IBM and CA Technologies in term of their Technology Strategy - Research Paper Example The paper will also consider the company backgrounds, the company statements, the strategic business analysis with due consideration to the Porter’s Five Forces Framework as well as Technology S-curve of IBM and CA Technologies. The similarities and the differences along with the product matrix of these two IT companies have also been taken into consideration in this discussion. Company Background IBM International Business Machines (IBM) is one of the world’s leading information technology companies involving a broad range of products and services related to different technology driven industrial sectors such as, software, hardware, and research and development (R&D) among others. IBM is also involved with consulting services, hosting along with infrastructural assistance which engages a series of operations from mainframe computer to nanotechnology segments (IBM, 2011). Currently, IBM has its head quarter located in New York and is engaged with providing services to i ts huge number of customers all around the world. The organization currently employs more than 433,362 numbers of employees in all around its national and international locations. Notably, IBM recorded its revenue amounting to $107 billion in the fiscal year 2010-2011 which indicated a growth rate of 15% over the revenue earned on 2010 (IBM, 2011). CA Technologies Charles Wang and Russ Artzt, established CA Technologies in the year 1976. CA Technologies is also a well-known publicly owned company in the global Software Solution industry possessing a long term experience in the international IT environment. The company currently operates with due significance to the virtual and cloud computing technologies along with the mainframe and distributed computing service providers in the IT environment (CA, 2012). The company is presently identified as one of the largest software corporations which intend to put extensive significance to the process of innovation of software systems which a re used in the mainframe, along with the virtualized and cloud computing segments of technology industry (Cable News Network, 2012). The CA Technologies’ headquarter is located at New York. The annual turn-over attained by the company recorded revenue of $4.429 billion in the fiscal year 2011 operating with a total of 14,000 employees in its worldwide locations (CA, 2012). Vision and Mission Statements IBM The mission statement of IBM signifies its strive to lead in the global IT Industry enhancing the processes of manufacturing and developing the services rendered along with the products offered such as computer systems, storage systems, and software systems as well as the microelectronics segments of the industry. With this concern, the ultimate mission of the company is to maintain continuous development in its technology strategies through innovations and R&D initiatives. Based on its mission statement, the company depicts its vision statement as to be committed to transf orm the advanced technology services and products into value for the customers in the course of professional solutions and consulting business throughout the world (Company Statements & Slogans, 2008). CA Technologies The vision statement of CA Technologies concentrates on recognizing

Summary Essay Example | Topics and Well Written Essays - 250 words - 82

Summary - Essay Example The issue of identifying the affected birds was complicated by the lack of manifestation in ducks which pose potential risk to humans in an area. The virus that cause the flu mutated from the original type that affected birds only to a complicated one that is unaffected by the immunity system of humans. The virus is spread when an avian strain meets a strain that is adapted to spreading the virus in mammals and the exchange can take place in the body of a person or any other animal host. In the past, the flu has killed a large number of animals with a record 40million people noted to have died from it between 1918 and 1919 and showing that it can wipe very many people within a short time with few chances of survival after infection. Some organisations have partnered to increase surveillance of the influenza because the former studies focused on humans, swine, chicken and horses. This is regardless of the high monetary demand that is posed in attempt to produce a vaccine to curb the virus, which is very harmful to the

Project 3 Essay Example | Topics and Well Written Essays - 1750 words

Project 3 - Essay Example Samples are subjects chosen from a specified population for investigation purposes in statistics. A random sample has also been defined as the sample in which every component of the whole population has an equal opportunity of being selected (Black 220). Babbie describes the process of random sampling as the basic sampling method assumed in nearly all statistical computations (211). The process and steps that will be taken to collect data in such a way to actually take a random sample include: 1. Establishing a sampling framework drawn from the population. This framework is used to represents the population and findings from it will be used as an assumption of what actually takes place in the whole population. 2. Numbering the members of the population, for example if we want a random sample of three hundred people from a population of eleven thousand, we number the people from one to nine hundred and eighty. After the numbering our task shall be to select a simple random sample of 300 people out of the population totaling 11,000, A survey was undertaken to determine the attitude of undergraduate ISU students towards cheating. This section provides the summarized data and analysis. From the survey conducted seventy one out of the ninety-seven students would major if offered through the college of business. This represents 73.2% of the student population out of 26.8% who would not major if offered through the college of business. Out of the students interviewed thirty three were female and sixty four were male. This represented a ratio of 34.02% to 65.98% of female to male students. Out of this population, fifty-three students representing 55.79% admitted that they had taken at least one distance education course. The other 44.21% admitted that they had not. The analysis for questions five to seventeen is provided in the table below: From the table

The Nuer Tribe Essay Example | Topics and Well Written Essays - 3250 words

The Nuer Tribe - Essay Example Central Sudan, where the capital Khartoum is located, is the urban region where most of the population resides. Speaking 300 different languages, the different tribes have a history of infighting since time immemorial. Famine and the almost incessant fighting between the tribes have always been catalysts for the social and economic deterioration of Sudan (Sharp 147). The main ethnic tribes are the Dinka (12%), Nuba (8%), Beja (6%), Nuer (5%) and Azande (3%) (Lye 294). Probably the most important of these is the Nuer tribe not only because its habitat, the swamps of Sudd, might contain vast oil deposits that is currently being explored by Chevron Oil Company (Luciani 88) but it is 'the largest political segment of a people defined by a common language and a sense of common identity" and "the tribe was the largest population who not only claims a common territory but acknowledge the right of their members to compensation for injury" (Bhushan & Malik 106). southern Sudan in the region called the Sudd, which is a Nile-fed swamp as large as the US state of Maine. The Nuer tribe habitat is therefore the flood-plains of the White Nile and its tributaries and extends southwards to Abyssinia (Wellcome Tropical Research Laboratories 325). The Nuer habitat is about 500 kilometers south of Khartoum. The Nuer tri The Nuer tribe is part of the 3 major Nilotic tribes in southern Sudan, the other two being the Dinka and the Shilluk tribes, which physically bear resemblance to each other but each speak different languages and has its own customs and traditions. As a people, the Nuer tribe is divided into clans that in the 1930 census were identified to have numbered to 17 clans with a total population of 247,000 and which are scattered throughout southern Sudan in their own villages. Each clan averages about 14,529 Nuers in the 1930 census which had grown to 35,351 Nuers per clan in the 1955 census (Kelly 161). Recent years have placed the Nuer population at 1.5 million. The different Nuer clans are predatory and are very successful in their belligerent activities because albeit scattered, they are unified, manifesting capacity to unite on a large scale and to organize swift large-scale raids. The Nuer internal unity and its organizational skills are impressive unlike its main warfare victim, th e Dinka tribe groups which are "politically autonomous and do not unite in warfare or for any other purpose". A chink in the Nuer unity and kinship however shows, when a few Nuer clans i.e. the Jagei, the Western Jikany and Eastern Jikany oftentimes clash not only with the Dinka enemy but also with fellow Nuer clans (Kelly 160). The Nuer clans always fight for territorial expansion and this expansionism and predisposition to territorial appropriation had been rooted in the Nuer sociocultural system (Kelly 226). Since early times, the Nuer tribes

The United States Will Fall Like Rome Essay Example for Free

The United States Will Fall Like Rome Essay The United States is a powerful nation that is around 250 years old replicating that of Rome whose empire lasted 270 years. These empires have similar backgrounds regarding their foundation and governmental structures. The U.S. has a democracy that allows citizens to participate in the government while Rome’s republic acts the same way. Also, the United States’ legislative body is made up of Congress just like Rome who had a Senate. Some social pressures that occurred in Rome were the publics’ low confidence in the governing body of the empire. And finally, Inflation was an economic issue that contributed to the fall of Rome and is also occurring in the United States today. The social, economic and political contributions combined with Invasions by germanic tribes caused the final fall of Rome. The fate of the United States will mimic that of Rome in that social pressures, economic turmoil and political corruption will attribute to its demise. Social pressures are a major contributor as to why the U.S. will fall much like Rome. Rome’s Citizens started to show low confidence in Empire, much like what is happening in the U.S. now. Today, in the United States â€Å"sixty-five percent of American voters think the federal government is ‘broken’† (Blanton par1). The government is broken is up seven percentage points from fifty-eight percent two years ago. These percentages show the United States is losing much confidence in its government and is increasing over-time. Not only will the U.S. fall because of social pressures but also because of economic turmoil felt across the nation. Economic turmoil are a major contributor as to why the U.S. will fall much like Rome, inflation specifically. Inflation is an economic indicator that assesses the fall in purchasing power of currency. Usually, inflation is caused by an increase in the money supply, which leads to price increases.â€Å"In recent years there has been a steady increase in inflation rates† (U.S. Inflation). If inflation rates keep increasing so will the gap between the middle class and poor. The increasing of the gap between the middle class and poor is the reasoning for our society splitting up.Usually inflation is caused by an increase in the money supply, which leads to price increases. The lower classes will not be able to afford the price increases, the middle class most likely will thus causing the gap between the lower and middle class. Not only will the U.S. fall because of economic turmoil but also because of political corruption felt across the nation. Political corruption is a major contributor as to why the U.S. will fall much like Rome. Every year (CREW) releases a list of the most corrupt members in Congress.Rob Andrews earmarked federal funds for his wifes employer and also used his campaign money for personal expenses(Hickey par 8). The amount of betrayal that occurs in our government proves the U.S. citizens cant trust the political members in the U.S. government. Without confidence in our government the U.S is sure to fall. The social, economic and political contributions combined with Invasions by germanic tribes caused the final fall of Rome. The fate of the United States will mimic that of Rome in that social pressures, economic turmoil. In conclusion the final blow to the fall of the U.S. will be invasions from North Korea and their alliances..One can only assume that if North Korea develops nuclear weapons the South Koreans wont stand idly by,(Rogers par 6). With the technology that North Korea has such as nuclear missiles proves the U.S. will stand no chance against North Korea, the United States will fall.

Social environment Essay Example for Free

Social environment Essay I am a person who frequents the local gym. In fact it is part of my daily routine and it is a social environment I have come to know very well. After hunting for a good parking space I make my way through the set of automatic sliding glass doors. The temperature is always a consistent 70 degrees Fahrenheit – cozy and comfortable in the winter, and a refreshing break from the blistering heat of summer. When I approach the front desk to swipe my membership card, one of three people will greet me. Usually it’s a middle aged African American man called â€Å"Mr. Fred,† and you can bet that he’ll be wearing a smile. No doubt, he knows almost every member’s name despite the fact that there are hundreds. On the rare occasion that Mr. Fred isn’t at the front desk, either a beautiful young girl with brown hair and brown eyes, or an older polite woman will greet me. As I make my way up the tall, carpeted staircase I scroll through my Ipod to find something fresh. Upon arriving at the top of the staircase I scan the area to see who is present. Is it busy? Is the cute girl I noticed last week here? My buddy from school? Anyone else I know? It’s truly amazing how much it depends on the time of day. We live by the clock and sometimes I don’t think we realize how much it structures our lives. Three PM means it’s slow – there will be a few older retired folks lethargically moving around and trying to keep themselves busy. At Four PM the space slowly starts to fill in with people that got off work early or left early to avoid the rush. At Five PM the facility comes alive. The cardio machines will soon all be occupied, the spinning classes begin, the lanes of the pool are now filled, and the clang of weights being shuffled around echoes throughout the gym. This is a colossal gym. The ceilings must be 40 feet high in some places. Most of the activity takes place on the second floor where there are over 100 cardio machines of various types. There is also an indoor track that surrounds the machines and the weights. I walk over to the stationary bikes to begin my warm-up and wonder how many people have sat on this seat since I last did. Sometimes the seat is still on position â€Å"16† like I left it the day before, other times I find it fully extended and I know a seven foot tall guy must have been there. After about ten minutes on the bike, I make my way over to the weights where I discover a new face. It’s a girl with blonde hair and she’s probably about 20 years old. She seems a little lost – perhaps a new member without much weight-training experience. It’s funny how many new members there are following every New Years. Indeed they have all just made resolutions to get into better shape. So after a couple minutes of fumbling around with one machine, a guy approaches the girl and offers his expertise on the subject. He asks her which muscle group she wants to focus on, and then demonstrates the correct movements on the machine. She looks at him wearily as she tries to replicate the motions and he nods in approval. It seems an instant relationship has just formulated between the two. Who knows where it will lead, they may end up together for the rest of their lives. Next I move over to where the free weights are located. I watch myself in the mirror as I lift the weights over my head and then bring them back to my shoulders in a slow, controlled motion. In the mirror I notice two girls behind me on the abdominal machines. And to take a line from Akon – I can’t help but to notice them, noticing me. I have seen them a couple times before and there is a feeling of familiarity – almost as though we know each other, yet we have never met. In one of my psychology classes, we learned the term â€Å"familiar strangers. † These can be described as people that we see over and over throughout our routines but people that we technically do not know. These girls are an example of familiar strangers because although I have never conversed with them, there is a sense that I do know them on some level. This is true of many people I see at the gym, some of which I see almost every day. It’s as if I have a certain connection with these people even though we are not acquaintances. It’s a peculiar situation. I see them every day but we don’t really speak to each other, yet if I saw one of them in another setting (a bar, restaurant, or store) I would almost feel compelled to speak. If I didn’t acknowledge them, it would be as though I was choosing to ignore the fact that I recognized them as a familiar person from the gym. Tuesdays at the gym are particularly interesting from a sociological perspective. It’s a very busy day because there are a lot of group classes. One class called â€Å"Zumba† combines dancing with an aerobic routine that has been choreographed to hip-hop music. This is the most popular class at the gym; in fact, it’s so popular that they had to move the class to the basketball court. The basketball court can be overlooked from the second floor; so needless to say, when the hip-hop music starts blaring it draws a lot of attention. But I’m not sure the music draws as much attention as the 75 women bouncing around on the basketball court. The guys upstairs literally flock to the railing to check out the action. And the funny thing is – they don’t tend to make any effort to be sly about watching the women below. Instead, they just stare at them, grinning from ear to ear and joke around with buddies. I’ll admit, it is very difficult to keep your eyes off of that many girls, but I do my best to avoid gawking. The gym is a place I have come to know well and it is an excellent facility. It sometimes even feels like a second home because everyone there is so welcoming and friendly. And if my Ipod isn’t enough to keep me entertained during my workout, there’s always the option of â€Å"people watching. †

Impact of Financial Leverage on Firm Value

Impact of Financial Leverage on Firm Value Introduction If there is debt in a companys capital, such a company is termed leveraged or geared company. A gearing ratio demonstrates the relationship between fixed interest and equity capital in the finance of a business Measured: Fixed Interest Capital OR Fixed Interest Capital Capital Employed Equity The financial lever is a norm in measuring the scale of using debt in the firms capital structure. One of the most important issues in financial discussions is obtaining a blend of capital structure which has the most attractions for the investors. The structure of capital is a required link between debt and the equity that provides financial needs for preparing the companys properties. STATEMENT OF RESEARCH QUESTION There is a negative and significant correlation between financial leverage and firm. 1.There is a negative and significant correlation between financial leverage and earnings per share 2.There is a negative and significant correlation between financial leverage and price earnings ratio. 3.There is a negative and significant correlation between financial leverage and returns to equity. 4.There is a negative and significant correlation between financial leverage and operating profit. WHY INTERESTING The above research questions are interesting as they will address the following: Provide answer on the impact of gearing on the firms value; reconcile the argument as to whether financial leverage has relationship with earning per share; the level of correlation between financial leverage and price earnings ratio as well as operational profit. The questions will also seek to highlight the risks associated with leverage. Relation to previous research (Theoretical Framework) CAPITAL STRUCTURE THEORIES A companys capital structure shows all the sources of finance a company is utilizing to finance its operations. Capital structure refers to how a company finances its operations and it is usually made up of: Ordinary share capital Preference share capital Debt capital. There are two main theories about the effect of changes in gearing on the WACC and share value. There are: a.The traditional view b.The net operating income approach For which a behavioral justification was proposed by Franco Modigliani and Melton H. Miller (M M) in 1958 (Gitman, 2006). TRADITIONAL VIEW The traditional view states that debt capital is cheaper than equity and that such a company can increase its value by borrowing up to a reasonable limit (the optimal level of gearing). Return Kw Ke Kd P GEARING With the traditional theory, the following assumptions hold sway: Â   1.The cost of debt will remain constant until a significant point is reached when it would start to rise. 2.The WACC will fill immediately an external source of finance is introduced and will bring thereafter as the level of gearing increases. 3.The companys market value and the market value per share will be maximized where WACC is at the lowest point. M-MS SUPPORT OF THE OPERATING INCOME APPROACH The original normative theory of company valuation and capital structure was put forward in form of a behavioral justification of the Net Operating Income Approach by Franco Modigliani and Melton H. Miller (M-M) in 1958 (Gitman, 2006). To appreciate the propositions by M-M, it will be better to understand the M-M assumptions which are stated below. From these assumptions, M-M set out their three propositions. PROPOSITION I This states that a company cannot change the total value of its securities just by splitting its cash flow into different streams; the companys value is determined by its real assets, not by the securities it issues. Thus, capital structure is irrelevant if the companys investment decisions are taken as given. PROPOSITION II The expected rate of return on the equity of a geared company increases in proposition to the debt-equity ratio (debt/equity), expressed in market values; the rate of increase depends on the spread between the expected rate of return on a portfolio of all the companys securities, and the expected return on the debt. PROPOSITION III This provides a rule for optimal investment policy by the company: The cut off point for investment in the company will in all cases be the WACC and will be completely unaffected by the types of security used to finance the investment. Consequently, if the first two propositions hold, the cut-off rate used to evaluate investments will not be affected by the type of funding used to finance them, whatever may be the capital structure. The gain from using debt (at lower cost) is offset by the increased cost of equity (due to increased risk) and WACC therefore remains unchanged. Proposed methods STATEMENT OF METHOD Secondary data from financial database will be used. To determine the impact of leverage on the value of firm, a thorough study will be taken on each entity in the integrated chain. My choice of the above data collection method rested on their validity and research question. I also consider them to be less costly in relation to others. The study will try to integrate various academic literatures and examine the impact of financial leverage on the value of firms. Therefore, I shall obtain unbalanced panel comprising 25 companies listed on the Nigerian Stock Exchange for the period ranging from 2001- 2010 with relevant information over the last years. These firms and their published accounts will be used to determine the variable that will be stated. CHOICE OF THEORY There are two basic theories about the impact of financial leverage on firms value; the traditional theory and the Modigliani Millers theory. I shall base my study on the theory which seem more realistic with empirical fact. CAPITAL STRUCTURE In the academic literature, there two possible indictors of capital structure, namely, debt-equity ratio, defined as total debt divided by book value of common equity, and a ratio of debt total assets. In this analysis, the ratio of debt to common equity will be used. This will be more useful to explain the choice of a capital structure as compared to the ratio of debt to total assets. This variable shall be denoted as CS in our analysis. DATA COLLECTION The collection tools for the research project includes: Financial times statistical data from Nigerian Stock Exchange, Augusto rating on debt Equity Companies, Financial Index Journal. Others tool include the companys annual reports and account, the internet, financial newspaper particularly, Thisday, Institute of Chartered Accountants of Nigeria (ICAN) journals, Financial Standard, Business Times and some other foreign journal consulted at various library. The testing technique to be employed is regression and correlation analysis with the chi-square X2 distribution, which allows comparisons of an actual observed distribution with a hypothesized or expected distribution. This method is often referred to as a goodness of fit test. SAMPLE FRAME The secondary data above will be used in addition to the financial statement and Accounts of selected companies: Nigerian Breweries Plc, Pharma Deko Plc and Evans Medicals Plc. The result of the investigation will be analyzed and tested. The firm size shall be determined by its log of sales as published in their financial statements. Firms turnover as a percentage of capital employed will be used in our model. It is often argued that performance is a function of firm size and if we are to make a regression model with performance as response variable, it is important to incorporate firm size in our model. Firm size may be positively or negatively related to leverage. Odeleye (2014) come forward with the idea that large firms may exercise economies of scale, have better knowledge of markets and can employ better management personnel. Firm size also measures a firms market power or level of concentration within the industry. Reflections Finance: The execution of this project required substantial financial outlay. The sourcing and gathering of data, paying working visit to firm, conducting enquiry to the operations of the company and packaging available information into coherent project, required funding. Time: It takes time to conduct inquiry, investigation as well as gather, compile analysis and interprets data and then organizes them into a research work. The researcher worked under severe constraints of time as there was a deadline for the submission of the project. Attitude of the Practitioner: Although some information was readily provided by staff of the organization, a few other relevant ones were considered as confidential and strenuous efforts had to be made to collect some of the information that were regarded as confidential. Altogether, the limitations were so severe as to vitiate the research outcome, more especially because the researcher managed to overcome the obstacle. Physically, only some selected leveraged companies in manufacturing activities as an option for growth enhancement of market are included to minimize the expenses. Another limitation is that not all leveraged companies turn out to be successful in relation to market values; this research does not cover those companies. I obtained all the necessary information I needed for empirical analysis considering the advanced nature of the financial reporting of the firms under review which confounds to international standard? The financial regulation in Nigeria might not be up to date with respect to submission of financial statement. The gathering of data from some of the companys department required some payment. This expenses which was budgeted for constituted a challenge, yet there was a possibility of missing some data which is not found on the financial statement of the companies. This study was carried out with a sample of firms listed on the Nigeria Stock Exchange. The first empirical obstacle will be the availability of data for a minimum of ten trading years for the firms under study. The financial regulations in Nigeria require firms to submit their audited financial statements as well as certain information regarding their firms value. However, the data submitted by firms are in hard copy format and they are thus stored at the companys department in paper format. Given that availability is limited to hard copies, I feel that I will need to bear into mind the time factor involved in the manual gathering of relevant data. Moreover, data regarding a single company might be in different volumes and this might involve delay out of proportion in this assignment. Timetable July 2015 Proposal Submission August 2015 Proposal Approval September/October 2015 Literature review November 2015 submission and amendment of chapter 1based on examiners approval/comment December 2015 submission and amendment of chapter 2 based on examiners approval/comment January 2016 submission and amendment of chapter 3 and 4 based on examiners approval/comment February 2016 submission and amendment of chapter 5 based on examiners approval/comment March 2016 Proof reading, final editing, printing/binding and project submission References Akinsulire, O. (2002), Financial Management 2002. COEMOL Nig. Ltd Gitman, L. (2006). Leverage and Capital Structure (4TH Ed). Boston: Pearson Anderson Wiley. Odeleye, A. (2014) Corporate Financing and Efficiency of Indigenous Energy Firms in Nigeria: A literature Review. International Journal of Energy Economics and Policy. 4(1).