Impact of Corporate Governance on Capital Investment

Impact of Corporate Governance on Capital Investment Introduction Overview Through various studies over the years, different scholars and financial analysts have been able to establish a relationship of cash flow on firmsÃÆ' ¢Ãƒ ¢Ã¢â‚¬Å¡Ã‚ ¬Ãƒ ¢Ã¢â‚¬Å¾Ã‚ ¢ investment spending. It was significantly proven by (Modigliani Miller, 1958) that a firmâ„ ¢ financial status is irrelevant for real investment decisions in a world of perfect and complete capital markets, after controlling for the cost of capital. In case of managerial discretion, based on (Jensen, 1986) free cash flow theory, firms increase investment (including projects with negative present value) based on the availability of cash flows with incentive of increasing firmsâ„ ¢ value beyond level of optimal investment. Moreover, an agency costs also appreciate the borrower net worth by charging a premium on the external financing. The discussion above explains that the firmsâ„ ¢ investment decisions are dependent on the availability of internal funds, as cost advantage over external fund is evident. While choosing an appropriate capital structure, there are certain trade-offs which affects the decision. These trade-offs include tax advantage through acquiring debt against the bankruptcy cost which advocates the use of equity. Keeping this in view, various different models have been supported to explain this corporate capital structure behavior. Pecking Order Theory, initially mitigated by (Donaldson, 1961) describes the financing practice as prioritizing the means of financing, which is necessary for the management to counter against asymmetric information. Either they should generate the funds internally or acquire funds externally through debt rather than equity. Implications to the pecking order theory involves the positive impact of leveraging on the market price, which means, financing through debt sends a positive signal into the market about the firmâ„ ¢ future prospects. Furthermore, intermediaries also undermine the role of management as the financial intermediaries such as investment banks function as the insider to the firm. Consequently, keeping an eye on the firms operations and influencing the firmâ„ ¢ capital financing decision. However, Pecking order theory of (Myers, 1984) argues that the firms operating in imperfect or incomplete capital markets where the cost of external capital exceeds that of internal funds, the financial structure may be appropriate to the investment decisions of companies facing uncertain prospects. Gauging the level of corporate investment in any firm is based on the corporate governance; market position of a firmâ„ ¢ asset against its book value can be termed as Tobinâ„ ¢ q ratio. Identified by (Chung Pruitt, 1994), Tobinâ„ ¢ q as the ratio of a market value of a firm to the replacement cost of its assets. Tobinâ„ ¢ q can be considered an effective tool for determining financial performance as the data can be collected readily from a balance sheet. When calculating Tobinâ„ ¢ q ratio, the replacement cost can be determined approximately by the book value of firmâ„ ¢ plant and equipment. Approximate q can be replaced with the actual Tobinâ„ ¢ q to make the calculations unproblematic and data can be readily available without any discrepancies. Problem Statement To study the impact of corporate governance on the capital investment decision through cash flow and Tobinâ„ ¢ q interaction in relation with Capital Investment HypothesEs H0: Firms with investment spending that is influenced by cash flow will be associated with high Q values. In fact, the equilibrium level of Q for these firms will be larger than one. (FCF Theory) HA: Firms indicating a liquidity constraint by not paying dividends will have the most significant cash flow/investment relationship, and will be associated with high Q values in the market. (PO Theory) Outline of the study The report contains the contemplation of research data that will study the phenomenon of cash flows and investment discussed earlier in this paragraph. The study categorizes firms according to characteristics (such as dividend payout, size) which will help measure the level of constraints faced by firms. The study will help readers to understand the complexities of Pecking order theory and Free Cash Flows concept with regard to asymmetric information available and corporate governance which influences decision of the firms. To measure the effect that cash flow-financed capital spending and Q has on firmsÃÆ' ¢Ãƒ ¢Ã¢â‚¬Å¡Ã‚ ¬Ãƒ ¢Ã¢â‚¬Å¾Ã‚ ¢ investment, Ordinary Least Square Regression model will be used to estimate the function. To compute the influence on the Investment, instruments used are: (1) Cash Flow, (2) Approximate q, and (3) an interaction of both variables are created. Through studying the parameter estimates of interaction variable, positive influence on investment will support the Pecking Order hypothesis and negative influence will govern the Free Cash Flow hypothesis. The equation hypothesized in the next part is linear. Definitions Pecking Order Theory: (Myers, 1984): A firm is said to follow a pecking order if it prefers internal to external financing and debt to equity if external financing is used. Free Cash Flow Theory According to (Jensen, 1986) free cash flow theory, high cash flow and low debt create agency costs associated with conflicts between manager and share holder over the payout of this free cash, which is the cash left after the firm has invested in all available positive net present value projects. Capital Structure A careful and systematic analysis of how claims against a corporations assets can or should be determined, assessed, and accounted for. (Riahi-Belkaoui, 1999) Capital Investment Decision Capital Investment decisions are those decisions that involve current outlay in return for a stream of benefit in future years. (Drury, 2006) Tobinâ„ ¢ q Tobins q is a measure of investors expectations concerning a firms future profit potential. It is defined as the ratio of the market value of a firm to the replacement cost of its assets. (Strecker, 2009) Literature Review (Vogt, 1994) explained the capital spending behavior of companies with respect to change in dividend cash paid, cash flows, sales, and market value of assets. The regression equation models the variables to proportion of fixed assets, and distributes the firmsÃÆ' ¢Ãƒ ¢Ã¢â‚¬Å¡Ã‚ ¬Ãƒ ¢Ã¢â‚¬Å¾Ã‚ ¢ data in segments of Dividend Payout Groups and Asset Groups. Primarily, Dividend Cash has a strong negative impact on capital spending; it explains that in order to finance additional fixed investment firm needs to sock cash by reducing their dividend. Cash flow, Sales, and Q Ratio having a positive coefficient demonstrates that with an increase in future cash flows, the firm will improve its capital spending. (Cleary, 1999) has developed a relationship between the firmsÃÆ' ¢Ãƒ ¢Ã¢â‚¬Å¡Ã‚ ¬Ãƒ ¢Ã¢â‚¬Å¾Ã‚ ¢ investment decision and the firmâ„ ¢ financial status. Financial status has been studied with respect to the liquidity constraints. The data is classified into groups through a discriminant analysis on basis of dividend payout policy. These groups helped identify which firms are more prone to be financially constrained and the results showed that firms having high credit worthiness are significantly more sensitive to the availability of internal funds than that are less credit worthy. It has been proposed that the various ownership structures make managerial decision based on the interaction between investment and the firmsÃÆ' ¢Ãƒ ¢Ã¢â‚¬Å¡Ã‚ ¬Ãƒ ¢Ã¢â‚¬Å¾Ã‚ ¢ liquidity constraints. The study conducted by (Dedoussis Papadaki, 2010) mentioned that the management can be held separate from its ownership, even on basis of the nationality of the company. On the other hand, it also explained that the relative shareholding of CEO and the controlling shareholders can also be the basis of separation. Findings support that the Low Q, small, and new firms under the generalized model are facing asymmetric information problems. Indeed these firms are expected a priori to face financing problems that affect the cost of their external financing. On the other hand, low Q, old and low dividend firms are more likely to face managerial discretion problems that result to over-investment. The impact of Tobinâ„ ¢ Q is mainly used to determine the investment opportunity of the firm. In this article, marginal Tobinâ„ ¢ Q has been taken to evaluate the firmsÃÆ' ¢Ãƒ ¢Ã¢â‚¬Å¡Ã‚ ¬Ãƒ ¢Ã¢â‚¬Å¾Ã‚ ¢ investment and Research Development expenditures. Under the asymmetric information (AI) hypothesis firms with attractive investment opportunities may be unable to finance them because of inadequate internal cash flows and because the cost of external funds is too high due to the capital markets ignorance of the firms investment opportunities. The agency or managerial discretion (MD) hypothesis links investment to cash flows by assuming that managers obtain financial and psychological gains from managing a large and growing firm and thus invest beyond the point that maximizes shareholder wealth. (Gugler, Mueller, Yurtoglu, 2004) Taking in viewpoint the impact of capital structure on the capital investment decision, firmsÃÆ' ¢Ãƒ ¢Ã¢â‚¬Å¡Ã‚ ¬Ãƒ ¢Ã¢â‚¬Å¾Ã‚ ¢ investment demands is the more susceptible towards cost-of-capital or tax-based capital incentive. Whereas, capital structure seems irrelevant as against internal sources of funds can be effectively substituted with sources of funds generated externally. (Fazzari, Hubbard, Peterson, Blinder, Poterba, 1988) explicates that cash flow/investment relationship is more sensitive when taken in reference with firmsÃÆ' ¢Ãƒ ¢Ã¢â‚¬Å¡Ã‚ ¬Ãƒ ¢Ã¢â‚¬Å¾Ã‚ ¢ dividend behavior. Comparison based on firms having more or less liquidity constraints can be further improved when compared on a division based on the scale of the firms, i.e. young or small firms versus large ones. This way the researchers can address the problem of firms lacking the asymmetric information. Research Methods The chapter explains the model used in the given research study. The study focuses on analyzing the influence of Cash Flows and Tobinâ„ ¢ q on Corporate Investment. The equation representation consists of the proportion of capital spending to the beginning-of-periods net fixed asset (I/K) as a function of: (1) cash flow divided by beginning-of-period gross fixed asset (CF/K), and (2) beginning-of-period Tobins q (Q). Method of Data Collection Main source of collecting the required data is from secondary sources. It includes the Balance Sheet Analysis of Joint Stock Company listed in Karachi Stock Exchange provided by State Bank of Pakistan consisting of data of our relevant variables. The data was taken in annual terms to conduct this research. Sampling Technique The Convenience sampling or grab or opportunity sampling would be use in this research. Sample population selected because it is readily available and convenient. Sample Size The sample period taken under study covers 8-years period beginning at the start of 2000 and ending at the close of 2008. The data was taken from a sample of 70 (non-banking and non-financial) companies which are listed on Karachi Stock Exchange and included in KSE-100 index. Research Model Statistical technique Ordinary Least Square Regression technique is used to study the impact of variables included in the study. It helps studies the relationship between a dependent variable and several independent variable. It also assumes the relationship to be linear or ÃÆ' ¢Ãƒ ¢Ã¢â‚¬Å¡Ã‚ ¬Ãƒâ€¦Ã¢â‚¬Å"straight line,ÃÆ' ¢Ãƒ ¢Ã¢â‚¬Å¡Ã‚ ¬Ãƒâ€š? where the values of predictors lies directly proportional to Criterion variable. SPSS Software is used to develop the regression model and evaluate the influence of predictors on dependent variable. Results Findings and interpretation of results Aggregate Sample: Table : Represents the model summary of regression estimates for the full sample of 69 firms The predictors, i.e. main effects of Cash Flow and Tobinâ„ ¢ q and an interaction term of both, included in the model helps explain 78.5% of Investment (Table 1) shown mentioned as R Square. Least variation in Adjusted R Square suggests that the variable to observation ratio in the given model is sufficient. Casewise diagnostic was also conducted to eliminate the outliers in the data to improve the results. Table : Studies the F-statistics to test whether the model predicts the dependent variable significantly The F-statistics (Table 2) is significant and it determines the regression model with the given predictors can significantly predict the outcomes at a 0.05 significance level. Table : The parameter estimation for full sample of 69 firms with respect to dependent variable, t-statistics is used to test the null hypothesis ÃÆ'Ã…Â ½Ãƒâ€šÃ‚ ²1 = ÃÆ'Ã…Â ½Ãƒâ€šÃ‚ ²2 = ÃÆ'Ã…Â ½Ãƒâ€šÃ‚ ²3 = 0 The coefficient values of all predators included in the test are significant at a 0.05 significant level (Table 3), which shows that they have a strong influence on the investment of the firm. The standard coefficient shows that Cash Flows have a much greater impact on Investment than market value on the firm, which is exemplified through Tobinâ„ ¢ q. Dividend Payout groups: Table : Presents the sample statistics for 69 KSE listed (non-banking and non-financial) companies which are included in the KSE-100 index. The three rows distribute the statistics into High, Medium, and Low payout policies. Average dividend-to-income ratios of greater than 0.35, between 0.35 and 0.10, and less than 0.10 define High, Low, and Medium dividend-payout firms, respectively. While studying the dividend-payout groups (Table 4), the descriptive helps to identify characteristics to confirm whether the data being studied has the authenticity and the behavior pattern which commonly related to the groups assigned. The values of Investment, Cash Flow, and Tobinâ„ ¢ q associated with the groups are in complete correspondence with the hypothetical occurrence. Firms having a higher (lower) dividend payout have greater (lower) market value, and lower(higher) level of cash flows and investments. Table : Represents the model summary of regression estimates of 69 firms split by High, Medium, and Low dividend-payout policies. The model helps explains 81.9%, 66.7%, and 80% data in High, Medium, and Low dividend-payout firms (Table 5), shown in R Square. Least variation in Adjusted R Square suggests that the number of observations is sufficient with respect to variables in each group separately. Table : Studies the F-statistics to test the null hypothesis of ÃÆ'Ã…Â ½Ãƒâ€šÃ‚ ²1, H = ÃÆ'Ã…Â ½Ãƒâ€šÃ‚ ²1, M = ÃÆ'Ã…Â ½Ãƒâ€šÃ‚ ²1, L The F-statistics (Table 6) in each dividend payout group is significant and it determines that each regression model with the given predictors can significantly predict the outcomes at a 0.05 significance level. Table : Shows the parameter estimation for each payout groups with respect to dependent variable, t-statistics is used to test the null hypothesis ÃÆ'Ã…Â ½Ãƒâ€šÃ‚ ²1 = ÃÆ'Ã…Â ½Ãƒâ€šÃ‚ ²2 = ÃÆ'Ã…Â ½Ãƒâ€šÃ‚ ²3 = 0 The coefficient values of predators in High and Low dividend payout groups are all significant at a 0.05 significant level (Table 7), which shows that they have a strong influence on the investment of the firm. Except for Medium dividend payout group, which has insignificant coefficient values of Tobinâ„ ¢ q, showing no impact on the investment. The standard coefficient shows that Cash Flows have a much greater impact on Investment than market value on the firm, which is exemplified through Tobinâ„ ¢ q. Hypothesis Assessment Summary Hypothesis Independent Variables B t Sig. Comments Firms with investment spending that is influenced by cash flow will be associated with high Q values. In fact, the equilibrium level of Q for these firms will be larger than one. (FCF Theory) Cash Flow ÃÆ'Æ’Ã ¢Ã¢â€š ¬Ã¢â‚¬  Q H0= ÃÆ'Ã…Â ½Ãƒâ€šÃ‚ ²3 ÃÆ'Ã…Â ½Ãƒâ€šÃ‚ ²3,H = .135 5.295 .000 Rejected ÃÆ'Ã…Â ½Ãƒâ€šÃ‚ ² 3,M = .072 .991 .324 ÃÆ'Ã…Â ½Ãƒâ€šÃ‚ ² 3,L = .140 5.482 .000 Firms indicating a liquidity constraint by not paying dividends will have the most significant cash flow/investment relationship, and will be associated with high Q values in the market. (PO Theory) Cash Flow ÃÆ'Æ’Ã ¢Ã¢â€š ¬Ã¢â‚¬  Q HA= ÃÆ'Ã…Â ½Ãƒâ€šÃ‚ ²3 >0 ÃÆ'Ã…Â ½Ãƒâ€šÃ‚ ² 3,H = .135 5.295 .000 Accepted ÃÆ'Ã…Â ½Ãƒâ€šÃ‚ ² 3,M = .072 .991 .324 ÃÆ'Ã…Â ½Ãƒâ€šÃ‚ ² 3,L = .140 5.482 .000 Dependent Variable: Investment Table : Summarizes the results and explains that the hypothesis accepted is directly in correspondence with the aggregate hypothesis. As illustrated (Table 8) capital spending of low payout firms is positively and strongly influenced by the interaction term, consistent with the PO hypothesis, the parameter estimate for the high payout firms are also positive but marginally significant. Conclusion, Discussions, Implications And Future Research Conclusion The results illustrated above demonstrates that the positive relationship between the degree of the CF/I relationship and Q found latter in the aggregate data (Table 3) is concentrated in low or no dividend paying firms. This finding is in further support with the PO hypothesis. Discussions The objective was to study and test the causes of universal relationship between Cash Flow and Investment Spending. Hence, two hypotheses were included in the research to study the source of this relationship: the free cash flow hypothesis (FCF) hypothesis, which works on the assumption that managers prefer investing its free cash flow excessively into investment projects that are not profitable, and the pecking order hypothesis (PO) purports that managers are prone to investment comparatively less than the opportunity provided due asymmetric information-induced liquidity constraint. As advocated in favor of Pecking Order Theory by (Fazzari, Hubbard, Peterson, Blinder, Poterba, 1988) and many others, for groups which consists of small firms with low-dividend payout to fund capital spending, exhibits heavy reliance on cash flow and cash changes. The relationship can be more significantly studied when the impact of larger q value is associated with this group. Evaluating the impact of corporate governance on investment-cash flow relation requires a critical judgment as to how do the firmsÃÆ' ¢Ãƒ ¢Ã¢â‚¬Å¡Ã‚ ¬Ãƒ ¢Ã¢â‚¬Å¾Ã‚ ¢ cash flow and the existing market value influence the investment decision. Financially constraint firms may have a larger impact on liquidity associated matters and managers might take discretion in choosing the right sources to tap. Agency cost may be involved in making such a decision where managers may consider paying dividend as a higher opportunity cost as it reduces the firmsÃÆ' ¢Ãƒ ¢Ã¢â‚¬Å¡Ã‚ ¬Ãƒ ¢Ã¢â‚¬Å¾Ã‚ ¢ free cash flow to exploit new profitable investment projects. Implications and Recommendations In the current market situation where external pressures existing can also be taken into proxy. When managers making a capital investment decision they need to take in view other non-financial aspects that also influences the decisions to a certain extent. Furthermore, financial intermediaries having a certain level of involvement and sharing information sensitive to the market can also be a major factor that might be giving a varying result against Investment. Investing in profitable-investment projects can bring in greater resources to the firm in future and it entails a huge decision burden upon the shoulders of the managers. Shareholders expecting to earn a greater return through investing in them can also be undermined when manager decided to have a low payout policy. Funds generated internally is a possibility where there is a healthy cash flow, but it is also preferable if this free cash is invested into marketable security for allocating the resources into a profitable venture for a time being to make it a positive impression. Future Research In future studies there may be more aspects of cash flow-investment relationship which can be studied for assessing the degree impact it has on this relationship, i.e. sales, debt performance, capital structure, firm size, etc. The research study may also be improved if the observation of firms are increased that will in turn reflect a more clear picture about the relationship in the current scenario.

How Does Robert Louis Stevenson use literary techniques to illustrate E

How Does Robert Louis Stevenson use literary techniques to illustrate the social, historical and moral points he is trying to make in Dr Jekyll and Mr Hyde? Throughout the Novella, ‘Dr Jekyll and Mr Hyde’, the author Robert Louis Stevenson uses a wide range of literary techniques in a skilful and sophisticated way to help achieve his effects and put his points across. Stevenson’s unique use of language is vital to the success of the Novella, with the structural and linguistic devices playing a vital part in creating the unusual atmosphere, which makes the Novella so successful. Dr Jekyll and Mr Hyde centres upon a conception of humanity as dual in nature, although the theme does not emerge fully until the last chapter, when the complete story of Jekyll – Hyde relationship is revealed. Robert Louis Stevenson had a very strict moral upbringing living in the nineteenth century, where class and social standing were very important in such a rigid system. The fact that he had such a religious background perhaps creates a link between the main moral point of good and evil and his disciplined religious upbringing, the bible teaching the importance of good and evil, and the seven deadly sins. He uses a variety of techniques to put across his views across on many social, historical and moral points. Throughout the novella the author gives the readers an insight into the morality of human nature by using different characters to represent the double standards of society in the Victorian era. The different language used for each of the main characters in the book is used to emphasise the character and their role in the Novella. Utterson, the lawyer, is described in the opening sentence of the book ‘cold, scanty, a... ...t that Stevenson had such a religious background perhaps creates a link between the main moral point of good and evil and his disciplined religious upbringing. This may have influenced him in his writing, (the bible teaching the importance of good and evil, and the seven deadly sins). The Gothic horror has been compared particularly to the detective fiction of Sherlock Holmes, with both works being written in the same period of the Victorian era. It is a testimony to Stevenson’s inventiveness as a writer that this novella has had this independent existence over a hundred years after the first book was published. Because of the uniqueness of the novella and the fact that such a wide range of literary techniques have been used, it is no surprise that, ‘the strange case of Dr Jekyll and Mr Hyde’, is one of the most famous works of horror fiction of all time.

The Consumer Complaint Behavior

The consumer complaint behavior, CCB in short, is an area of research which deals with the identification and analysis of all the aspects involved in the consumer reaction to a product or a service failure and the consequent perceived dissatisfaction. A growing interest for CCB starts appearing toward the middle of the '60s as a particular aspect of a general attention for consumer behaviors and attitudes. Consumer satisfaction, dissatisfaction and consumer complaint behavior, in particular, are three distinct, but highly correlated subjects investigated by marketing and consumer studies.Real marketing problems can be considered at the origin of these studies. The growing competition in the market, the developing consumerism, the importance given to quality, performance and satisfaction, the emphasis given to customers, considered at the Centre of a product or of a service, bring researchers to inquiry about the complex mechanisms which determine customer satisfactions or dissatisfac tion and what are the consequent consumer behaviors.At the same time, as the research is deeply rooted in real life, the findings of the studies are aimed at identifying and suggesting managerial and practical solutions directly applicable to markets or services. As far as CCB research is concerned, the main aspects investigated can be summarized according to the some questions. The proposed list is anything but exhaustive: 1. Why do people complain? 2. Why do people not complain? 3. To whom do people complain? 4. Facing an unsatisfactory product or service, what are the possible reactions available for a customer? . Are there any differences in CCB according to the product or the service investigated? Being a Customer Relationship Manager of a luxurious hotel in Penang I received a mail from Mr. Stanley. He and his family stayed at my hotel last week. He has complained that the quality of food served was not satisfactory, hotel staff very impolite and not helpful and his computer n otebook and some cash was missing from his hotel room. Also he has criticized the hotel staff members that they do not listen to his complaint patiently. Firstly, I will send Mr.Stanley a letter of apologize and tell him about we will take further step even when full resolution is likely to take longer because fast acknowledgment remains very important and this action helps to build rapport with customer, the ? rst step in rebuilding a bruised relationship. In this letter I would not argue with Mr. Stanley and the goal should be to gather facts to reach a mutually acceptable solution, not to win a debate. Arguing gets in the way of listening and seldom diffuses anger. Next, I will show that I understand the problem from his point of view.Seeing situations through his eyes is the only way to understand what he thinks has gone wrong and why he is upset. Service personnel should avoid jumping to conclusions with his interpretations. Besides that, I have to clarify the truth and sort ou t the cause. Mr. Stanley says my hotel staffs are impolite, the food served is not satisfied and hotel members didn’t listen to his complaint, it may result from inefficiency of service, misunderstanding by Mr. Stanley, or the misbehavior of a hotel staff or third party. If I’ve done something wrong, I will apologize immediately. The more Mr.Stanley can forgive me, the less he will expect to be compensated. I would not be defensive because acting defensively may suggest that my hotel has something to hide or is reluctant to explore the situation fully. Furthermore, I will provide Mr. Stanley the bene? t of the doubt because not all customers are truthful and not all complaints are justi? ed. However, he should be treated as though they have a valid complaint until clear evidence to the contrary emerges. Because Mr. Stanley miss some cash money and computer notebook from his hotel room so careful investigation is warranted.Because the amount involved is not small, it ma y be worth haggling over a refund or other compensation. However, it’s still a good idea to check records to see if there is a past history of dubious complaints by the same customer. Propose the steps needed to solve the problem. When instant solutions aren’t possible, I will tell Mr. Stanley how my hotel plans to precede shows that corrective action is being taken. It also sets expectations about the time involved and I should be careful not to overpromise. I have to keep Mr.Stanley informed of progress because nobody likes being left in the dark and it may cause uncertainty breeds anxiety and stress. People tend to be more accepting of disruptions if they know what’s going on and receive periodic progress reports. Moreover, I have to consider compensation. When Mr. Stanley do not receive the service outcomes he believes he has paid for or have suffered serious inconvenience and loss of time and money because the service that hotel provide are failed to delive r to him, I might offer an unconditional money back guarantee and tell Mr.Stanley if at any point during the search process he is unhappy with progress, simply address the fact with us and if we are still not 100 percent satis? ed after that discussion, I will cheerfully and unconditionally refund every cent he has paid as a retainer. No quibble, no hassle, guaranteed period. This type of recovery strategy may also reduce the risk of legal action by an angry customer. Service guarantees often lay out in advance what such compensation will be, and hotel should ensure that all guarantees are met.Whatever is promised in the guarantee must be totally unconditional, and there should not be any element of surprise for the customer. The guarantee has to easy to understand and communicate to Mr. Stanley so that he is clearly aware of the bene? ts that can be gained from the guarantee. Meaningful to Mr. Stanley in that the guarantee is for something important to him and the compensation shou ld be more than adequate to cover the service failure.Guarantee has made must easy to invoke It should be easy for the customer to invoke the guarantee and it also have to easy to collect on because If a service failure occurs, the customer should be able to easily collect on the guarantee without any problems. Lastly, guarantee has to be credible and be believable. Persevere to regain Mr. Stanley goodwill. When Mr. Stanley has been disappointed, one of the biggest challenges is to restore his confidence and preserve the relationship for the future. Perseverance may be required to defuse is anger and to convince him that actions are being taken to avoid a recurrence of the problem.Truly exceptional recovery efforts can be extremely effective in building loyalty and referrals. Also I will check the service delivery system and pursue eminence. Because Mr. Stanley has left, I should check to determine whether the service failure was caused by accidental mistakes or system defects. I ne ed to take advantage of every complaint from Mr. Stanley to perfect the whole service system. Even if the complaint is found to be a result of a misunderstanding by Mr. Stanley, this implies that some part of my communication system is ineffective.But while we discussed the importance of professional complaint handling and service recovery, we have to acknowledge that not all complaints are honest. When ? rms have generous service recovery policies or offer guarantees, there is always the fear that some customers may take advantage. Also, not all complaining customers are right or reasonable in their behavior, and some may actually be the cause of complaints by other customers. We refer to such people as jaycustomers. Every service has its share of jaycustomers. Jaycustomers are undesirable. At best, a ? rm should avoid attracting them in the ? st place, and at worst, a ? rm needs to control or prevent their abusive behavior. Let us ? rst describe the main types of jaycustomers befo re we discuss how to deal with them. De? ning a problem is the ? rst step in resolving it, so let’s start by considering the different types of jaycustomers. I’ve identi? ed seven broad categories. The Cheat – There are many ways in which customers can cheat service ? rms. Cheating ranges from writing compensation letters with the sole purpose of exploiting service recovery policies and cheating on service guarantees, to in? ating or faking insurance claims and â€Å"ward robing†.The Thief – Those customers who always wishes to payless or not to pay, these may be like travelling in public transport freely, or not paying restaurant bills and others – firms to be prevented from such customers use many tips because if company is not taking actions against such people; other customers would also have intentions to behave in such manners. The Rulebreaker – Those customers who don’t obey rules of company or country like breaking traf fic rules – even though it costs them sometimes a lot but they do because they feel pleasure in behaving such manners†¦.Company should ensure that rules are to be followed. The Belligerent – Expresses resentment, use to abuse employees verbally or even physically. It causes demotivation of employees if company doesn't react upon such customers because for everyone in this world SELF RESPECT is most important thing, Guards/Security are their best solutions, Company should also guide their Front line staff to deal with such uncertain circumstances†¦ The Family Feuders – Customers who gets in detailed arguments with other customers about company of any kind.The Vandal – Those customers who always makes hurdle for company like pouring water in ATM, writing on walls, in cybercafes deleting windows files or other software. The Deadbeat – These are not like thief but close to them, these are those who pays the amount but after creating such prob lems for company, like I’ll pay tomorrow, they know that they have to pay but they try to delay as much as they can. Encouraging customer feedback provides an important means of increasing customer satisfaction and retention.It is an opportunity to get into the hearts and minds of the customer. In all but the worst instances, complaining customers are indicating that they want to continue their relationship with the firm, but they are also indicating that all is not well and that they expect the company to make things right. Here, service firms need to develop effective strategies to recover from service failures so they can maintain customer goodwill. That is vital for the long-term success of the company.Having professional and generous service recovery systems does not mean â€Å"the customer is always right† and that the ? rm is open to customer abuse. Rather, it is important for the bene? t of all too effectively deal with jaycustomers. (1782 words) References www . google. com www. wikipidea. org http://deni9ek. blogstudent. mb. ipb. ac. id/files/2011/12/CHAPTER-13-CASE-3. pdf http://www. scribd. com/doc/51888732/Services-Marketing-Lovelock-Wirtz-Chaterjee-Ch-13

Polytheism - 2057 Words

Polytheism Reproduced, with permission, from THE FUTURIST, Published by the World Future Society, 7910 Woodmont Avenue, Suite 450, Bethesda, Maryland 20814 Toward the end of the nineteenth century, the German philosopher Friedrich Nietzsche wrote a fictional account of a madman who went about the town proclaiming that God is dead. Nietzsches story is illustrative of a wave of atheism that spread through the intellectual circles of Europe in the late nineteenth and early twentieth centuries, but that never caught on in society at large. The idea of the divine demise, however, did not die: A movement by theologians resurrected Nietzsches thesis in the 1960s, amidst the other forms of radical thinking that characterized that decade.†¦show more content†¦MONOTHEISMS THREE-PRONGED PROBLEM Monotheism also contains another essential problem--one with implications for the future. The Western God of the Jewish-Christian-Islamic tradition illustrates the core difficulty in monotheism, a philosop hical conundrum that has been called the theodicy problem. It is formulated as a trilemma and can best be illustrated this way: Among the following three statements, it is logically possible to reconcile any two of them, but the agreement of two implies that the third is false. The three statements are: 1. God is omnipotent. 2. God loves us. 3. Evil exists. In the first instance, if God can do anything (create the universe, for example), and if the universe contains natural and moral evils (hurricanes and Hitlers, for example), then it would seem that God lacks compassion for the victims, especially when these victims are innocent sufferers. Dostoyevskys character Ivan in The Brothers Karamazov makes this case eloquently when he tells the story of innocent children tortured by cruel soldiers in front of their parents. How could a loving God allow this? The second case is the acceptance of a loving, concerned God and the existence of evil in the world. This implies that even God cann ot find a way to eliminate evil, or at least reserve it as punishment only for those who deserve it. A God who cannot do this is less than omnipotent. Finally, one canShow MoreRelatedEssay Monotheism vs. Polytheism1577 Words   |  7 PagesMonotheism and polytheism are two very different belief systems. Monotheism is the belief in one god and polytheism is the belief in more one than one god. The concept of morality can and does exist within cultures that have only one god, as well as cultures that have multiple gods. Without morality, the world would be a place of extreme chaos and pandemonium. 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