Communication in Banking Sector

Developing a proper communication strategy in a banking sector must be built in the context of the customers expectations. In the current time, banking organizations are no longer interested in developing better communication strategies that will serve their clients. This is because they obsessed with making money, and maximizing on their profitability.
In view of this, most of this cooperation do not obtain their objectives because they are unable to attract new customers, and their normal customers run away from them, because of poor communication strategies.
INTRODUCTION:
During the current times, big organizations have a variety of employees who perform various jobs. The organizations employ marketing staffs, to market their services, and seek for clients. To increase their efficiency in communication, banking institutions employ company spokesmen to communicate their strategies and achievements to the stakeholders, to the government and to their shareholders (Bell and John, 23).
Communication is an important element that determines the profitability and efficiency of a banking organization. A banking organization cannot attract and retain a wide customer base without initiating better and effective communication strategies. Despite these realities, banking organizations maintain poor communication strategies. One of the main reasons is their desire to maximize profits, at the expense of customer satisfaction.
Trends in Communication Strategies:
In 1998, Citi Group merged with Travelers, and this made them as one of the largest banking organizations in the world. The company formed CEEMEA, its subsidiary which was in charge of looking for market in Europe, Africa and Asia. The organization realized the importance of communication in a business set up. To improve their communication capabilities, the company made a series of reforms, and introduced high end communication strategies such as the integration of information technology in their business set up.

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The results were immediate; the profitability of the company increased by more than 100%, and the company won numerous enterprise awards, for their introduction of information technology in the banking industry. The company managed to outperform established multinational business organization such as Barclays Bank, and Standard Chartered Bank. Other banking organizations followed the example of CEEMEA, and introduced information technology in their banking system. In the case of CEEMEA, customers could access their financial details, through the internet. An individual had the capability of opening a new account with the banking organization (Mohan, 20).
This made the organization to record an approximate number of two million banking accounts. This is the power of enacting proper communication channels in the banking industry. This is report outlining the effects of poor communication strategies in the banking sector. This report identifies the various needs of customers, and how the banking institution can satisfy these needs. This report identifies the strategies of competing banking organizations in relation to establishing proper communication channels, and thus creating customer satisfaction. It offers recommendations on better strategies, the business organization ought to implement.
Effects of poor communication strategies and customers’ expectations:
Banking cooperation’s will lose customers and fail to retain their existing ones if there communication strategies in inefficient and poor. This will most likely lead to reduced profitability, emanating from the reduction of their sales revenue. This will affect the objectivity of the banking corporation, and therefore give an edge to its competitors in the banking sector. Poor communication strategies will also affect the employees of the organization. For instance, withdrawing important information to the employees in regard to the objectives of the company, will make them loose focus, and concentrate on their desires at the expense of serving the customers. This will lead to poor and inefficient service, leading to loss of customers, and again reducing the profitability of the business organization.
Poor communication with a corporation will result to a culture of rigidity, and therefore limit the innovative capacity of its employees (Bell and John, 33). The competition in the banking organization is fierce, and to survive in the market, it is important for the bank to encourage innovation. Lack of it, is recipe for poor performance, therefore giving an edge to its competitors. To encourage innovation, the banking organization must initiate proper channels of communication, and increase incentives to anybody who comes up with better business ideas.
Customers expect so much from the banking corporation. One expectation of customers is honesty from the customer care staff, while giving information on certain services of the organization. For instance a customer might approach the customer care staff on the requirements of taking a loan, and how to repay the loan. It is essential for the customer care staff to act in a professional manner, and give out all the details concerning the issue at hand, and the expectations of the customer.
By doing so, the customer care staff will help the banking organization to create a brand name, that depicts honesty and reliability. This is an essential element in attracting and retaining customers. Another expectation of a customer is a speedy flow of information. Customers might require certain information from the banking corporation, and to get the information, they need to contact the customer care staff. The employee might need to consult, and gather the information. This process should not take long. This is because it will create anxiety on the employee, depending on the issue at hand.
There is also an issue of accessing their bank accounts. Customers require mobility in accessing their bank accounts. Their presence at the banking premises must not be essential, for them to access their banking account. They may need details of their transaction, or to check the balance in their accounts. The cooperation can device measures of ensuring that their customers can access their accounts through the internet or even their mobile phones. This will require a high degree of innovation.
Solution to the Problem:
One of the most effective methods of solving the communication problem within the organization is to adopt the concepts of open innovation. The cooperation needs to conduct a case study, and observe how successful banking cooperation such as Barclays Bank, Citi Group developed their communication strategies. The organization will thereafter adapt the strategies that are beneficial to them. For example integrating Information Technology in the organization is essential. This is a strategy that CEEMEA, a branch of Citi Group Cooperation enacted as part of its communication strategies (Mohan, 27).
Another solution is to train its customer care staff on the better communication strategies. This is to impart on them the necessary skills required to interact with customers, and the various stake holders of the company. Customer care staffs have a responsibility to act as the public relations personnel of the banking cooperation. It is important to equip them with necessary skills of how to handle the various stake holders of the business organization, including the customers of the business (Bell and John, 31).
The cooperation should create a proper communication channel, between the top management, and the junior staff. Managers of the organization should act as coaches and not administrator. This will enable them effectively communicate the objectives of the company, and will motivate the employees to work hard, so that they may help the organization to achieve its objectives.
The Case of Barclays Bank:
Barclays bank cooperation realizes the importance of effective communication in a banking industry. To disassociate itself from poor communication strategies, the organization has merged the marketing department with the communication department. This is because proper communication influences the degree in which a banking cooperation will achieve success in attracting and retaining customers.
There is the department of internal and external communication. Internal communication has the responsibility of liaising with the marketing department to ensure the company says the right words concerning their achievements to the internal stakeholders of the company. This includes investors and various high skilled employees (Mohan, 49).
The company has integrated Information Technology in its operations. Through information technology, the company is able to develop digital images of its services, therefore attracting new customers, and retaining the existent ones. The cooperation uses websites, and search engine optimizations, to make its presence felt. As a result of these measures, the organization has managed to retain its customer base, and attract new customers.
Conclusion:
In conclusion, the success of a banking cooperation depends on the superiority of its communication and marketing strategy. Without proper communication channels, the organization will struggle to market its services. In relation to this, it is essential for a banking organization to invest heavily in building proper communication infrastructure within its set up.
The organization must re-design its goals, create a channel where junior employees will access their senior partners, and chat on the best ways of creating customer satisfaction. To create an effective communication infrastructure, the cooperation must move from its notion of profit maximization, to customer satisfaction. This will ensure that the staffs are innovative enough to come up with better ideas on how to further advance the objectives of the company. On this note, a company without better communication strategy is a company designed to fail in business.
 

Effect of Ireland’s Dairy Sector on the Economy

Select a leading Irish exporting food company as a case study to illustrate contribution to economic growth in their relevant sector and the changes in global food consumption within that food sector. Additionally based on 21st Century Trends in the Global Food sector identify how the company is addressing these trends and how the predicted changes in future production processes and levels along with international economic and government strategies will impact on the company in the future.

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Introduction:

I decided to do this assignment on Dairygold as I grew up on a dairy farm and I thought I would always end up as a dairy farmer but about 10 years ago my dad decided to change into the beef sector as our land wasn’t up to the task of dairy farming especially the way most of the farmers were expanding and at such a rate.

The big got bigger and the smaller either spent a mad amount of money expanding or diverted into the beef sector and got a side job with guaranteed income and my dad decided on the later

The dairy sector in Ireland has grown a lot in the last few years and continues to grow with a 22% expected increase in milk supplies between 2018 and 2025 according to Dairygold

Some background information on Dairygold:

Dairygold were established in 1990 after Mitchelstown and Ballyclough merged as the shareholders seen an opportunity to be stronger and they wanted to take advantage of the rich Golden valley farmland and produce premium dairy ingredients from there.

They are Irelands largest farmer owned co-operative and they established a strategic plan to develop opportunities abroad.

As the world’s population is projected to increase to nearly 10 billion in 2050 they have invested heavily in research, innovation and world leading facilities to produce premium ingredients.

Since the abolition of the quotas in 2015 they have a lot more milk through the gate which they want to make good use of and in turn offer better returns to the farmers supplying the milk and make better products for their customers.

They supply nutritional solutions for infants through to the active ageing.

Their 2017 figures are as follows:

Volume of milk supplies in liters 1.3 billion up 8.3%

Operating profit 32.4 million Euros up 85%

1,200 employees

7,000 shareholders

Money invested in the last 5 years is 162.1 million Eu

Net asset value is 335.5 million Euros

 

Revenue is 965.5 million Euros divided into:

76% dairy food ingredients 722.3 million Euros

23% agri business 220.3 million Euros

1% financial + property 11.9 million Euros

 

Dairygold product mix 2017:

 

Dairygold operates 2 primary Routes to Market, to maximise the commercial return:

Route 1 – Ornua, focusing primarily on the supply of branded product in the B2C channel, leveraging on their world renowned brands.

Route 2 – Dairygold Direct, focusing on key strategic B2B relationships, leveraging its technical competency and developing innovative customer specific products.

Food Ingredients

Dairygold supplies premium cheeses and dairy nutritionals made from milk whey and casein to the global marketplace, including infant formulae and protein powders.

By adding value through smart innovation, research and industry-leading processing techniques, their already nutrient-rich raw milk is being converted into top quality ingredients that will nourish the growing world.

 

Milk Powder

Dairygold is focused on adding value to dairy Ingredients by combining technical expertise and application insight. Their range of products include Full Cream Milk Powder, Fat Filled Milk Powder, Skim Milk Powder, Rennet Casein and a variety of whey products primarily 90% demineralised whey powder. Their Nutritionals Campus Mallow, manufactures Regular and Instant Full Cream Milk Powders and Fat Filled Milk Powder. Their Mitchelstown dairy processing center manufactures Rennet Casein, Skim Milk Powder and is one of the largest demineralised Whey manufacturing plants in Europe, with a specific focus on infant nutrition market.

Bulk Cheese & Butter

Their high quality, sustainable milk supply, allied to manufacturing expertise built up over many years, allows them to meet the market requirements for the highest standard of Cheese and Butter.

Their skilled Innovation team work tirelessly to ensure that their products are constantly evolving to meet the ever changing needs of the market.

 

Cheese Solutions

Dairygold provides quality cheese solutions to a diverse range of food companies, where flavour, functionality and value are key to their success. Their portfolio of cheese products is versatile and suitable for many different applications. They have invested in high-tech equipment and processing facilities to produce premium quality cheeses that are tailored to meet the strict requirements of modern manufacturing environments, rigorous accreditation standards and demanding consumer tastes. Their range includes cheddar cheese and specialty cheeses, as well as customised solutions for individual and exclusive client specifications. As cheese experts, they work with clients to ensure they supply their precise product requirements. They are renowned within the industry for their application knowledge and experience. They can provide simple block cheese through to soft cheese and liquid applications, and have an unrivalled ability to meet last-minute demands, while always ensuring premium quality and value. By being available to support and advise their partners and customers, they have developed long-term relationships, providing premium cheese solutions to the global marketplace.

 

21st Century Trends and how they are dealing with them:

Global Markets:

Turnover was up 25% to 153 million in 2017 reflecting increased sales volumes and increased selling prices.

Dairygold opened a Nutritionals campus in Mallow in Cork in 2017 which cost 87 million Euro.

It is a state of the art processing facility that will increase their presence in the International market

In 2017 they also opened an office in China to deal with its Chinese customers and the broader Asian markets

Their cheese ingredients businesses in the UK and Germany had another successful year, delivering increased sales with strong operational and financial performances

The businesses based in the UK and Germany are focused on B2B activity and provide routes to market for Irish product.

Both businesses provide key routes to market for cheese manufactured at Dairygold’s Mitchelstown and Mogeely facilities.

The overseas businesses performed ahead of expectations despite the challenges of recovering increasing raw material prices. 

The businesses continue to enhance the strong relationships they have developed with key players in the industrial and food service sectors, by providing innovative cheese and ingredient solutions along with excellent service.

They also exhibited at a number of strategic global food industry exhibitions including Gulfood in Dubai, Food Ingredients China (FIC) and Food Ingredients Europe (FIE) in Germany.

 

Brexit:

“Dairygold is ready to fight its corner in relation to cheddar exports ahead of upcoming Brexit negotiations”, according to Dairygold CEO Jim Woulfe.

Following the Brexit vote in 2016 there is a lot of uncertainty in the Irish economy and the dairy industry

For Dairygold, circa 30,000 tonnes of cheddar, equivalent to circa 300 million litres of its milk pool is utilised in the production of cheese for the UK market.

Dairygold are planning for a “hard Brexit” but hoping it won’t happen.

If it does there could be a significant import tariff on Irish cheese and the thinking is that the UK would become more self-sufficient if this were to happen

Dairygold is focused on developing alternative routes to market and on product diversification to reduce its exposure to the UK market.

Sustainable Dairy Assurance Scheme (SDAS)

 All of the milk that was supplied to Dairygold in 2018 was from SDAS certified farms.

The Bord Bia Sustainable Dairy Assurance Scheme was developed in cooperation with milk producers, processors and regulatory authorities. It was designed to assist in securing new and existing markets for Irish dairy produce as farmers look to increase milk production since the abolishment of quotas in 2015 It sets out the necessary criteria to produce quality milk and in addition the scheme has also been designed to assess and record data to demonstrate the sustainability of Irish dairying in a systematic way at individual farm level.  It will therefore provide the necessary proof to customers of dairy products that milk has been produced under both Sustainability and Quality Assurance criteria.
The primary objectives of the Scheme are:

–          To demonstrate to customers of dairy products that milk is produced sustainably under an accredited scheme

–          To provide a uniform mechanism for recording and monitoring

–          To set out the criteria for best practice in Irish dairy farming

With the SDAS in place Ireland will be the only country systematically measuring and improving its environmental performance at a national scale. The scheme is fully accredited under ISO 17065.

All dairy farmers with a valid herd registration can apply for this scheme and will have to be evaluated by an independent auditor and will need to meet certain criteria set by Bord Bia to obtain a certificate

Carbon intensity from Dairygold farms has improved by 7%

Energy efficiency from powder processing has improved by 3.4%

Waste to landfill from cheddar production has improved by 2.4%

 

Dairygold continues to invest in its future by developing existing and new products, improving processing capacity and efficiency, identifying new customers and routes to market, developing and working with its people on its future strategy to sustainably maximize returns to its Members.

Understanding the importance of their members

Dairygold offer a voluntary fixed milk price scheme due to the volatility of the market so the farmer can be sure where they stand and in turn can plan their finances better

They offer discounts to members in their “Buying For” initiative which was launched in 2016 by offering discounts home and farm fuels and by offering home, farm and vehicle insurance packages

They have a Loyalty Reward Scheme in place for customers and suppliers

They have a member upskilling program to help members to better understand the society and the dairy industry and the markets along with agricultural policies, finances and business

The have developed “Leanfarm” which adopts the principle of Lean to improve safety, reduce physical labour and have a positive impact on farmers quality of life and wellbeing

Strategic Direction to 2025

There is an increasing global demand for cheese and dairy protein and Dairygold plan to take full advantage of this by focusing mainly on these 2 specific markets and continuing to make investments in its operational and commercial capability and infrastructure to meet the growing market requirement, particularly in the developing world and to accelerate its journey and create more functional and complex products to meet the growing market demand.

HTF MI released a new market study on Global Full Cream Milk Powder Market predicting a significant demand by 2023

Conclusion

There are a lot more alternatives to milk on the market these days like:

Soy milk

Oat milk

Rice milk

Almond milk

Flax milk

Coconut milk

It’s up to Dairygold to keep coming up with new and innovative products and to stay ahead of the curve to keep its current customer base and continue to get new customers in the future and so far in my opinion they are doing a pretty good job but similarly to the milk prices consumer change can be also volatile so who knows what’s around the corner.

The weather will play a big part in this as if the weather is too extreme like 2018 then there will be fodder shortages and in turn this will drive up costs for farmers and make it unsustainable to make a profit so by paying a decent price for milk and educating its members Dairygold are helping their future.

References:

 

Mauritian Banking Sector History And Evolution Finance Essay

The Mauritian economy has transformed itself from a poor sugar economy in 1970’s to export-led growth strategy. After some time the Export Processing Zone sector was introduced to help to decrease unemployment level and foreign direct investment from Hong-Kong, France and UK increased which led to a better Mauritian economy. The growth of the country was examined by Arbache and Page (2008) from 1975 – 2005 and it was found that the island “was one of the best performers” compared to Namibia, Seychelled and south Africa for example, in terms per capita growth and low growth volatility.
Along the development of the manufacturing sector, the tourism sector surfaced as an important pillar contributing to the economy by increasing foreign earnings. Though these 2 sectors were doing well, diversification in services sector took place in the 1990’s.
Orientation was made to the financial services sector where the main focus was on the banking and insurance. Laws were enacted powering the development of this sector. In 1988, the Banking Act was amended to introduce offshore banking in Mauritius. Then, the Stock exchange of Mauritius Act 1988 established the Stock Exchange of Mauritius.
3.1 The Mauritian Banking Sector History and Evolution
The first bank being established is the “Bank of Mauritius” in 1813 failed in 1825. Then, along with the start off of a second Bank of Mauritius in 1832, the Mauritius Commercial Bank (MCB) was established in 1838. Both banks were severely affected by the financial crisis in London in 1847, though the MCB being the only one which survived to present. The MCB is now the largest bank with market share of more than 40%.
In addition to the above, a third Bank of Mauritius was establishes in 1894 opening a branch in Seychelles which was then acquired by HSBC in 1916. HSBC is, therefore, referred to as the oldest foreign bank being followed by Barclays Bank Mauritius ( a descendent of National Bank of South Africa).
A new Bank of Mauritius (BoM) was set up which earmarked the monetary history of the Island. Being established in 1967 as central bank, it has the sole power to issue notes.
Some functions of the central bank are:
Formulation and implementation of monetary policy
Government’s bank
Managing of the public debt and foreign exchange reserves
Regulating and supervising of banks
Today, Mauritius possesses a sophisticated banking sector with 20 banks. Banks form the base of the financial system as 70% of Total Financial Sector Assets are from the banking sector [Mohamudally-Boolaky and Ramlall (2009)] – supporting the fact the banking sector contributed more than 6% of GDP for the past year [Board of Investment Report 2011]. Besides traditional banking facilities, banks provide the following facilities: Point of Sales, ATM, Card, Internet banking, Mobile Banking, E-commerce facilities and so on.

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3.1.1 Major Developments in the Mauritian Banking Sector
3.1.1.1 Segmental Reporting under a Single Banking License Regime
As from 2004, banks were no more segregated into onshore and offshore as the Banking Act 2004 was amended to govern all banks with a single banking license. Operations are now classified into Segment A (other banking activities than Segment B) and Segment B (Provision of financial services to non-residents that creates “foreign source income”) [Guideline on Segmental Reporting under a Single Banking Licence Regime – BoM (2005)].
3.1.1.2 CAMEL Rating
The BoM uses the CAMEL rating, which is an International bank-rating system, to rate individual banks according to factors that envelop financial, operational and managerial performance. CAMEL stands for:
C – Capital adequacy
A – Asset quality
M – Management
E – Earnings
L – Liquidity
Table: CAMEL Ratings for the Quarter ended 30 June 2012
Bank
Overall Rating *
1
ABC Banking Corporation Ltd
3+
2
AfrAsia Bank Limited
2-
3
Bank of Baroda
2+
4
Bank One Limited
2-
5
Banque des Mascareignes Ltée
3-
6
Barclays Bank PLC
2-
7
Bramer Banking Corporation Ltd
3+
8
Century Banking Corporation Ltd
2-
9
Deutsche Bank (Mauritius) Limited
2+
10
Habib Bank Limited
2-
11
HSBC Bank (Mauritius) Limited
2+
12
Investec Bank (Mauritius) Limited
2+
13
Mauritius Post and Cooperative Bank Ltd
3+
14
P.T Bank Internasional Indonesia
2-
15
SBI (Mauritius) Ltd
3+
16
Standard Bank (Mauritius) Limited
2-
17
Standard Chartered Bank (Mauritius) Limited
2-
18
State Bank of Mauritius Ltd
2+
18
The Mauritius Commercial Bank Limited
2-
20
The Hongkong and Shanghai Banking Corporation Limited
2+
* 1: Strong 2+ and 2- : Satisfactory 3+ and 3- : Fair 4: Marginal 5: Unsatisfactory
Source: Bank of Mauritius Communiqué for CAMEL rating for banks 28 December 2012
3.1.1.3 Mauritius Credit Information Bureau (MCIB)
According to BoM MCIB update (2005), the MCIB “collects, stores and provides credit information to lending institutions about customers’ credit exposures”. As from December 2005, banks need to inquire about credit exposure of their borrowers from the MCIB before giving any credit facility to their customers.
3.1.1.4 BASEL I & II Framework
Basel I and II has been implemented in Mauritius in 1993 and 2008 respectively by the central bank and Basel III is under negotiations.
Under Basel II, for capital adequacy principles, banks are required to use the Standardised Approach to Credit Risk unless approval for Internal Ratings-Based Approach granted from the BoM [BoM (2008)].
3.1.1.5 Technological Development
Technological advances have contributed massively to the banking sector. New facilities have been developed such as:
Point of Sales;
ATM;
Cards services;
Internet and Mobile banking;
E-commerce facilities and
Banks are connected via the SWIFT network;
Cheque Truncation System and so on
3.1.1.6 Diversification
Banks are seeking regional diversification, for example SBM has branches in Madagascar and India [FSSA (2003)]. Also commercial banks such as SBM are becoming universal banks by diversifying into the following products: Wealth Management & Private Banking, Global Business, Fiduciary services, Asset Financing, and Stock brokering, amongst others.
Another major diversification of the financial sector is towards Islamic Banking under the Shari’ah principles. The first bank to offer this service is the HSBC through the HSBC Amana Branch. Then, in 2011 Century Banking Corporation started to operate as a wholly Islamic bank.
3.1.2 Benefits of the above major developments
The following are some of the benefits:
There has been an improvement in risk management;
Banks are becoming more competitive due to technological advances and they are having increasing technical efficiency;
Services offered are being designed to adapt to customers’ demand – les time consuming, availability on a 24/7 basis
Overall, banks are being more and more efficient. A proof of that is their survival during the Global Financial Crisis 2008. Though many banks closed down in the US due to the financial crisis, the Mauritian banking sector remained resilient, safe, lucrative and highly capitalised. As per the FSR 2011, this was possible due to high capital adequacy requirement, carefully designed regulations and better risk management.
3.1.3 Challenges and Future of the Mauritian banking system
The future of the banking sector is predominant as it drives the financial sector, which is a main pillar, to outstanding performance.
The future of banks that Mauritian authorities are still discussing about is the capital requirements of Basel III. This is because banks have a strong capital position and they are not exposed too much in the developments of external financial markets [FSSA (2008)]. However, it will have to be amended to suit the local context says J.Benoit (July 2012).
According to Khadaroo (2008), the participation of the BoM in the COMESA Regional Payment and Settlement System will allow extraterritorial payments among COMESA countries. This will reduce costs and time taken for the transaction to take place and enhance security.
Moreover, the island’s traditional European markets are in difficulty; therefore, authorities are planning to position Mauritius as an investment platform to link Africa and Asia [Zafar (2011)]. However, the problems that businesses will encounter are: lack of access to finance and infrastructure, corruption and political instability [Business mega (2013)].
Furthermore, the CEO of AfrAsia bank, J.Benoit (September 2012), said that new regulations and governance needs to be out since this will encourage banks to innovate. According to him, banks need to be encouraged to go for niche markets and large banks to do new things.
In addition, the Mauritian banking system lacks professionals to assist the financial sector development. Therefore, the island has been opened up to foreign talent to enable this development. Also, tertiary institutions have designed new courses – for example the University of Mauritius introduced Banking & Finance and International Business Finance courses to sustain the financial growth; and there are many new courses to come. Besides, from the Budget 2013, banks will offer a maximum of Rs 100,000 per year to students for their university fees.
Last but not least, the Mauritian financial sector will be more resilient to shocks in the future since this sector is becoming more open, exposures will continue to be managed prudently and there will be continuous enhancement in transparency
 

Gender Differences in Early Years Sector

Chapter 3 – Literature Review
Introduction:
The aim for this literature review is to examine the literature on the selected topic of men working in the early years sector and to the objectives of this research by acquire knowledge, through familiarising myself with the literature on the area. The objectives of this research are, to critically analyse the literature on Gender balanced workforce within in the early year’s sector. To explore what are the benefits to children of a more gender balanced childcare service and to identify are there any disadvantages? To identify practitioner’s views on why men in Ireland are not choosing to work in the early year’s sector and to identify practitioner’s views on how to encourage men into the childcare sector and finally to explore issues parents may have, if any on men working in the early year’s sector.
Background:
For many decades there has been a division of gender within the labour force. Commonly with men found in well paid occupations that are, highly skilled and that involve heavy work such as the construction or transport industries with female workers, on the other hand, have been found in caring nurturing occupations such as childcare, nursing or social work (Garrett, 1987). At present men are a very small percentage of the early year’s workforce in Ireland. Sources of data on the early years workforce show that men are at around 1 percent of the early year’s workforce in Ireland. Considering the huge changes in Ireland over the last decade it is surprising that this figure hasn’t really changed over the last ten years. So it isn’t surprising that also at present men are a small percentage of the childcare trainees in Ireland. Data gathered from research in other European countries shows some differences but men are usually well below 5 per cent of the early years workforce (see Cameron et al, 2003). This data from Europe also shows that Denmark has the highest proportion in Europe of male childcare workers, in Denmark men are 8% of the early year’s workforce.
Benefits of a more gender balanced childcare workforce:
The early years sector is not only a big employer in its own right but the early years sector is essential to enabling parents especially mothers to take up employment in the workforce. The childcare sector is, therefore, important to the achievement of gender equality in the workforce of Ireland. Increased participation of mothers in the labour market reduces child poverty and improves educational outcomes for children (see Penn et al, 2004). An important element of early years care and education is to promote inclusion and valuing diversity a more gender balanced workforce contests stereotypes and shows gender equality to young children. In this way, it is seen to enrich the quality of childcare (see Cameron et al, 1999; Moss, 2000). It is expected that in practice males will bring diverse skills to the workforce, reflecting on their own gendered rearing. (Jensen, 1996) argues that the quality of childcare is improved for children because it exposes them to diverse styles of playing, caring and instructing. The literature frequently states that such diversity enriches the range of children’s experiences while attending an early years’ service. It is proposed that children can benefit from seeing a male in a caring, nurturing and responsible role, particularly in terms of their relationships with others, behaviours and attitudes. (Daycare Trust, 2002), Furthermore Miller (1986) draws our attention to the fact that a conflict of identity can be experienced by both male and female teachers; between teachers’ roles as ‘nurturers’ and ‘carers’ on one hand, and on the other hand their professional role as educators (as cited in Drudy, Martin, Woods & O’ Flynn, 2005, p.23).

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The literature suggests that male childcare practitioners can be positive male role models for children these benefits are mostly spoken about in relation to the benefits for children of lone mothers as cited in Cameron, 2001, (Jensen, 1996) suggested that ‘the presence of male childcare workers could go some way towards providing constant, positive male role models for these children, as some kind of compensation for what is missing at home’ this is disputed by Christie (1998) as cited in Cameron, 2001 p. 435 Christie argues that ‘this model does not explain how, why, or for whom, male workers are expected to compensate, or whether compensation is possible’. Christie goes on to state, it may be wrong to assume that a child lacks a ‘father figure’ or other type of role model simply because they do not live with their father. And that it may not be realistic to expect a male worker to fulfil this role when such expectations are not placed on female childcare workers. Furthermore Owen (2003) states, it is unclear whether males provide role models for children by being as he say ‘traditional’ males in a female environment, Owen questions is it by engaging in so called ‘male’ play activities such as sport, or by challenging stereotypes by taking on a more traditionally ‘feminine’ caring and nurturing role. Further evidence to support such claims is provided by Bricheno and Thornton (2007) who found no indication that children even saw their teachers whether they are male or female as role models (p.394). Even though the concept of men in childcare being role models may be weak, it is supported by parents, early years employers, and the general public (Daycare Trust, 2002).
Every child is unique in their own individual way and has specific individual needs that need to be met in a responsive and appropriate manner by those who are caring for them. Children who are been cared for by Early Childhood Practitioners on a full-time basis within a pre-school setting are in their care for more than eight hours a day, therefore it is extremely important for Child care practitioners to meet their physical and emotional needs all the time in order to form close emotional bonds with children. According to Roberts (2010), childcare practitioners learn to recognize children’s emotional and physical cues and respond to them promptly and appropriately. By doing this she believed that practitioners allow for close emotional relationships to blossom (Roberts, 2010). As a result of these emotional relationships, Roberts (2010) also believed that they pave the way for children to develop healthily. This idea is highlighted by Benson et al (2009), who state that one of the most important contributors to healthy development is children developing close emotional relationships with a responsive and nurturing caregiver. Nowhere in this literature is it stated that gender affects the ability to care for a child.
Barriers to men working in the early year’s sector:
The literature suggests that main barrier to men working in the early year’s sector is the fact that there is such a low rate of pay and that childcare practitioners level of qualifications are not represented in their rate of pay as cited by RTE News online (18/2/2015), The association of childhood professionals said that over 25,000 people are working in the early years sector where the typical income is less than €11 an hour. Marian Quinn the associations chairperson stated that the situation is unsustainable because young people are choosing better paying careers instead of the early years. Furthermore the Irish Examiner (3/1/2015) argued that Representative bodies have been flooded with accounts of workers, qualified to degree level and with many years of experience, earning just €18,000 per annum. For a male who is the bread winner of a family this would not be sustainable Research by the Daycare Trust (2003) stated that nearly half of over 2000 adults that were interviewed said that better wages would encourage more males to work in the early years sector. Not surprisingly (Drudy, Martin, Woods et al., 2005,) found that In an Irish study of school-leavers and student teachers ‘low pay” was given as a primary reason for fewer males in primary teaching.
Another prominent barrier to the lack of males working in the early years sector is the it is a female dominated sector and the notion that it is women’s work, it is easy to understand that being in a minority may be an uncomfortable experience, and data suggests that this could be one of the key issues discouraging men from working in the early years sector. Historically, early childhood education has been seen as synonymous with caring for and nurturing young children and, consequently, continues to be widely regarded as ‘women’s work’ (Murray, 1996, p.368). Furthermore Daycare Trust (1999) posits that “Childcare staffs are overwhelmingly women and are strikingly badly paid compared with other caring professionals despite the commitment and professionalism which exists within the industry. Staffs have poor conditions of work and do long hours with little access to training or support. Morale can be low and the best often leave for better prospects elsewhere.” Interestingly Cameron (2001) acknowledges and asserts that if early childhood work was re-examined, with ‘higher professional status and a higher rate of pay, it could be expected that there would be more male employees, fewer men in the token, isolated situation, and possibly less reason to move on quickly’ (p.444). Many Childcare positions are part-time and this also causes a barrier to males seeking employment in the early year’s sector. At the same time, the availability of part-time employment in the sector suits many women in the sector, a number of who work in childcare while their children are young. This motivation has been found to be particularly strong among childminders, who work on a self-employed basis (see Mooney et al, 2001a&b). The high proportion of part-time jobs in the sector is thought to deter men and that they are more likely to seek full-time employment. According to Cameron, (2004). it is also evident that the men that do work in the early year’s sector are more likely to be found holding positions with older children in positions such as after school care rather than working with babies and younger children, This has been explained with reference to men’s preference for working with older children and choosing roles in education more so than caring roles.
What needs to be done to increase the numbers of men working in the early year’s sector?
As cited by Fine-Davis, et al (2005) highlights that there has been extensive backing for men to consider childcare as a career this was made clear by the European Commission (1992) which called on Member States to encourage and support increased participation by men in the care and upbringing of children. This theme was again encouraged in the White Paper on European Social Policy, A Way Forward for the Union (European Commission, 1994), and by the European Commission Network on Childcare (1990). It was found that despite the unquestionable support for increasing the number of men working in the childcare sector, the recruitment of men into the childcare field has not gained momentum. It has been suggested that particular attention should be focused on recruiting men into this area of childcare but as discussed earlier the barriers such as rate of pay, the lack of professional status associated with the profession and the current lack of males currently employed within the sector are barriers that need to be overcome before the possibility of men entering the early years workforce. Cameron, (1997) states that
“It would appear from the example of Danish childcare centres that where the work has been re-evaluated as valuable, and as appropriate for a mixed-gender workforce, the perception of ‘mothering and childcare equals low value work’ no longer holds as a principal motivation for employment in childcare work” (1997a: 64-65).
Fine-Davis, et al (2005), also suggests that it is evident that males will not be attracted to the field unless the salaries increase. At present Irish parents are paying some of the highest childcare fees in Europe, this isn’t because Ireland has the most costly childcare in Europe, but because the Irish government invests such a small percentage of GDP. Research also found that many early years’ employers acknowledge that the barriers to recruiting men into the early years sector are significant but they do not see that it is their duty to encourage men into the early year’s sector, but that responsibility lies with the Government, that the government needs to encourage this through advertising or through services such as careers education and guidance (see Rolfe et al., 2003). As cited by RTE News online (2015) Professor Noirin Hayes stated that the current investment in childcare of 0.1% of GDP compared to our European counterpart’s investment of 0.7% is not appropriate, addingchildcare was not a business but a social service and that needs to be recognised. Furthermore to this as cited by the Irish Times (2015) Chief executive of Early Childhood Ireland,Teresa Heeney, said crèche workers that are qualified to degree level 7 or level 8 with many years of valuable experience are being paid as little as €18,000 per year. Furthermore the Irish times also cited Marian Quinn (Chairperson of the Association of Childhood Professionals) she said,“We are losing many qualified, and skilled experienced and knowledgeable people who can at afford to remain in the profession of childcare. Things need to change on a government level for it to have any impact on the barriers to men working in the childcare sector.
“Equal opportunity needs to be a two-way process, as women move into male dominated areas and are encouraged to aspire to management positions, men should be encouraged into childcare and education, so that male participation becomes the norm rather than the exception.” (Thurtle et al, 1998: 632)
Parents views of a more gender balanced early year’s sector:
The literature suggests that parents recognise the benefits of a more gender balanced early year’s work force as cited by Cameron et al, (1999) some parents believed men and women had different skills in childcare, with men more able to engage in physical and fun activities, and women seen as more skilled in caring, nurturing and planning. But unfortunately the stigma of it being women’s work and the pre-conceptions that it is not a role suited to males still prevails. Even though parents and the general public mostly support the employment of more males in the early years sector, mainly on the grounds that males provide positive role models, there is also an element of concern identified through research from parents, college lecturers and the general public about the possible abuse from male practitioners (Thurtle and Jennings, 1998; Cameron et al., 1999). Penn and McQuail,1997concour with this stating that the topic of sexual abuse is undoubtedly a most important issue discouraging men from seeking employment in the early years sector. Male practitioners working with young children have reported being probed on their motives, and mistrusted of having perverse sexual intentions but there is no research out there that support any of these concerns and furthermore research by the Daycare Trust (2003) found that, although 77 per cent of participants, who included parents of children attending early years services, were in favour of more males working in the sector, 57 per cent said that one of the key barriers to men’s employment was the risk of paedophiles working with children’ and 56 per cent agreed that ‘people could be suspicious of a man working in childcare’ Owen, 2003 argues that this is somewhat unexpected given that cases of sexual abuse in early years sector are exceptionally rare, and that they do not all involve men.
Conclusion:
In concluding this literature review on men working in the early years sector it is evident through the literature that there are strong beliefs in the benefits of a more gender balanced early years workforce for the children and the workforce of the sector. Majority of the literature on the topic of men working in the early year’s sector seemed to focus on the range of perceived benefits, with particular focus on the benefits to children that attend early year’s services, but there was also a small focus on the benefits to the workforce and for the men that work in the sector. As cited by Scott and colleagues, research in the area of employment in the early year’s sector has focused more on the role of the sector in enabling women to participate in paid employment (Scott et al, 2000). The literature on the barriers to men working in the early years sector was also examined here we found how pay and the lack of professional status were the main barriers to men working in the early years sector. Following this we explored the strategies that were researched on ways to encourage men to see the early year’s sector as a viable career prospect it was discussed that more would have to be done on a government level for any changes to be prompted. Finally the area of the views of parents was explored in this section it came to light that parents did see the benefits to a more gender balanced early year’s workforce but that some parents still had concerns when it came to the safety of their children.
It also became very clear throughout the process of this literature review that because of the small percentage of men employed in the early years and the fact that there are very few examples of a mixed-gender workforce, these have not been examined empirically. The researcher was unable to source studies which explored the benefits of a mixed gender workforce through empirical research. Rather, the benefits identified are largely indicative and based on anecdotal evidence. The researcher also noted a lack of research or studies carried out on this area in Ireland. Thus forming an important research agenda for the future, it suggests a need for focused research on mixed gender workforces in childcare, to more accurately identify the benefits to children, parents and the workforce in Ireland.  

The Banking Sector Reforms In India Finance Essay

The banking sector reforms in India are aimed at introduction of best international practices and technological changes for making the Indian banking sector competitive globally. The Indian banking system is more efficient and stable today. Consequently there has been a rapid increase in the number of banks in this country. The banking horizon is changing because of the increasing number of private banks and the foreign banks. Apparently there is a cut throat competition between the banks. New and variety of services are offered by banks which are non-conventional and customized as per the customer requirements. Banks began to diversify their services as part of their corporate strategy to cater to various customer segments.
Structure of banking in India
The Indian banking system is classified into scheduled and non-scheduled banks. The scheduled banks are then classified as state cooperatives banks and commercial banks. The non-scheduled banks are classified as central cooperative banks and primary credit societies and the commercial banks.
Commercial banks are classified in both the scheduled banks as well as the non-scheduled banks. Schedule banks are those which are included in the SECOND SCHEDULE of BANKING REGULATION ACT 1956.
To be included in the second schedule a bank
Must have paid up capital and reserves of not less than Rs 5 lakhs.
It must also satisfy the RBI that its affairs are not conducted in a manner detrimental to the interest of its depositors.
File:Scheduled banking structure in India.png
RBI(Reserve Bank of India) is the central bank of the country. As the central bank of the country RBI has the power to supervise and control all the banks with the intensions of developing a sound and efficient banking system. It also performs many different developmental and promotional functions.
The functions of RBI are as followed:
Note issue
Bankers bank
The central bank
Banker to the government
Custodian to Foreign Exchange Reserves
Management regulation of exchange
Credit control
Other functions.
The Indian banking system has witnessed a substantial improvement in both stability and efficiency parameters such as capital position, asset quality, and overall profitability. There has been a remarkable improvement in the financial health of commercial banking sector. The banking sector reforms have improved the stability of the Indian financial system.
PERFORMANCE OF COMMERCIAL BANKS IN INDIA
Indicators
The performance and the efficiency is analysed in terms of profitability, productivity, financial stability, and quality of assets. The following indicators are used:
Profitability indicators: It is measured in terms of net profit of the bank. The interest, non-interest income, and the expenses influence the net profit.
Some of the important indicators of profitability are as follows:
Interest income as percentage of total assets: Interest income
Total assets
Higher ratio indicates higher profitability.
Interest expended ratio: Interest expenses
Total assets
Fall in ratio improves the profitability
Net Interest Margin(NIM): interest income — interest expenses
Total assets
A fall in NIM indicates the need to reorient the banks policies.
Intermediation Cost of Assets Ratio (ICAR): Non-interest expenses
Total assets
Lower the ratio higher the efficiency.
Overhead Efficiency(Burden)Ratio: Non-interest income
Non-interest expenses
Higher ratio indicates lower profitability.
Returns on Assets(RoA): Net profit
Total Assets
High RoA indicates better deployment of funds.
Return on Equity(RoE): Net profit
Total Equity
RoE will help the banks to access new capital.
Capital markets indicators: The capital market indicator is based on the EPS and P/E ratio.
Productivity Indicators: productivity indicators are generally analysed in terms of:
Profits per employee
Business per employee
Financial Soundness: Financial soundness is reflected by the Capital Adequacy Ratio.
CAR: Total capital
RWAs
RWAs: Risk Weighted Assets
Higher the ratio better is the sustenance of the banks.
Asset Quality: The quality of assets in the bank is shown by the level of non-performing assets (NPAs). Lower the ratio better is the asset quality. The 2 ratios used are:
Ratio of gross NPAs to gross advances.
Ratio of net NPAs to net advances.
11
The above graph has the data of the gross NPAs of the banks. The X axis depicts the years and the Y axis depicts the percentage. The red dotted line is for the Gross NPAs and the blue dotted line is for the Gross advances. Looking at the graph we can confidently state that the Gross NPAs are increasing whereas the Gross advances are decreasing since 2010-11.
PERORMANCE OF PUBLIC SECTOR BANKS, NEW PRIVATE SECTOR BANKS, AND FOREIGN BANKS IN INDIA
The comparative performance of public sector banks, new private sector banks, and foreign banks is explained below for the recent years
http://stockshastra.moneyworks4me.com/wp-content/uploads/2012/03/Indian-Banking-Industry-Statistics.png
Productivity and profitability of banks: Productivity is directly related to profitability. It is analysed in terms of business per employee and business per branch.
Business per employee: The business per employee in the public sector banks has increased from Rs 471.18 lakhs in 2006-07 to Rs1013.63 lakhs in 2011-12. But is still low as compared to foreign banks. The business per employee for foreign banks has showed a tremendous increase from Rs974.77 lakhs in 2006-07 to Rs1559.74 lakhs in 2011-12. The business per employee for the private banks has also increased from Rs695.23 lakhs in 2006-07 to Rs823.26 lakhs in 2011-12.
Profit per employee: The profits per employee are the highest in foreign banks followed by new private sector banks in 2011-12. Per employee profit was Rs 16.3 lakhs in foreign bank, Rs 8.1 lakhs in new private sector banks and Rs 5.93 lakhs in public sector banks in 2011-12.
Interest income: The interest income of public sector banks, new private sector banks and foreign banks showed an increase to Rs366318, Rs 96827 and Rs 28520 respectively in 2011-12.
Interest expended ratio: The interest expended ratio same as interest income has showed an increase for all the banks in 2011-12. The figures are Rs231153 lakhs, Rs57115 lakhs, Rs10622 lakhs.
Financial Soundness: The CAR(Capital Adequacy Ratio) is the most important indicator of financial soundness of banks. The capital to risk weighted assets ratio is shown is the figure below. The CRAR of public sector banks has been between 12 and 15 percent. The old private sector had CRAR lying between 12 and 15 percent. The new private sector had CRAR of more 15 percent. It goes the same with the foreign banks for the year ending in March 2012.
9
Asset Quality: the asset quality of a bank is shown by level of non-performing assets (NPAs). Better quality of assets is the indicator of efficiency. There is a vast improvement in the efficiency of Indian banks.
B1
The NPAs as percentage of Average Total Assets are increasing marginally in 2011-12. The NPA of foreign banks rose from 0.8 in 2009-10 to 1.4 in 2010-11 to 1.6 in 2011-12. The new private sector banks showed an increase from 1.1 in 2009-10 to 1.2 in 2010-11 to 1.3 in 2011-12 approximately. The old private sector banks has shown an increase but less as compared to the other banks. The national banks have shown a gradual decrease in the NPAs since 2009-10 to 2011-12.

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Customer services: In order to ease customer access to banking facilities, Indian banks have begun offering bouquet of financial services to their clients. The number of branches proving CORE BANKING SOLUTION (CBS) is increasing tremendously. Under CBS a number of services are provided such as ANYWHERE BANKING. The number branches of PSBs that have implemented CBS increase from 35464 in March 31, 2008 to 46304 in March 31, 2011.
ATMs
The banks are providing more and more ATM facilities to the customers. The foreign banks and new private sector banks are the larger contributors in this.
http://www.isrj.net/PublishArticles/img/306_2.gif
The above graph is for the year 2008-09. The highest number of ATMs is provided by the state banks but on-site. The highest number of ATMs provided off-site is by the foreign banks.
NEW TECHNOLOGY IN BANKING
The banks in India are using Information Technology (IT) not only to improve their own internal process but also to increase the facilities and services to their customers. Computerization has taken place all over India. The only motive is to bring banking at the fingertips of the customers and employees.
THE DIFFERENT FACILITIES PROVIDED ARE:
Virtual banking
ATMS
Debit Cards
Credit cards
Point of Sales(PoS)
Door step banking
Internet banking
Mobile banking
Telebanking
Phone banking
Electronic Funds Transfer (EFT)
Electronic Clearing Services (ECS)
Real Time Gross Settlement (RTGS)
REFRENCING
http://ebookbrowse.com/t-y-b-com-paper-iii-business-economics-eng-pdf-d419151576
http://etheses.saurashtrauniversity.edu/54/
http://schools-wikipedia.org/wp/e/Economy_of_India.htm
https://docs.google.com/viewer?a=v&q=cache:QUJlL6E5-TAJ:ijimt.org/papers/140-M582.pdf+&hl=en&gl=uk&pid=bl&srcid=ADGEESjYSzZ1KSelInYi2gBvlRjTk0WyxRsdcYOCBvBaopI7N3pzl8naPA62sFiG0tfzK2x-ZKiVFyysLZhluPTr3O5WorzEXuj_Sn-X6CV1dQ8dqEo1UDv64oMzU7s_i2pw0XNURAna&sig=AHIEtbRvIWrXt8CCpGACZrevqopfbX1i4Q
http://stockshastra.moneyworks4me.com/wp-content/uploads/2012/03/Indian-Banking-Industry-Statistics.png
http://www.indiainbusiness.nic.in/studies_survey/banking_systemsurvey.pdf
http://www.theinternationaljournal.org/ojs/index.php?journal=rjcbs&page=article&op=view&path[]=488
http://www.icra.in/Files/ticker/Indian%20Banks-Note%28Revised%29.pdf
http://www.icra.in/Files/ticker/IBS%20-%20FY11%20Perf.pdf
http://www.rbi.org.in/scripts/PublicationsView.aspx?id=14629
Business Economics 3 by Johnson, Mascarenhas, and Chatterjee.
The institute of chartered accountancy (India)
http://www.google.co.uk/imgres?hl=en&sa=X&tbo=d&biw=1366&bih=630&tbm=isch&tbnid=-qRyMTq-g80w5M:&imgrefurl=http://en.wikipedia.org/wiki/Banking_in_India&docid=RGeL8hvEN_HioM&imgurl=http://upload.wikimedia.org/wikipedia/commons/thumb/9/92/NUMBER_OF_ATM.png/220px-NUMBER_OF_ATM.png&w=220&h=169&ei=xBvwUKiVCpS20QWhmoHYAg&zoom=1&iact=hc&vpx=859&vpy=12&dur=180&hovh=135&hovw=176&tx=61&ty=46&sig=115207852604614094774&page=4&tbnh=135&tbnw=176&start=72&ndsp=25&ved=1t:429,r:76,s:0,i:316
 

Performance Appraisal: Textile Sector

The present study was under taken with such a task in mind and it aims at unearthing the strengths and weakness of the current performance appraisal system in textile industry Coimbatore that is prevalent in the organization that sponsored this research work.
Since organizations exist to achieve goals. The degree of success that individual employees have in reaching their individuals goals is important in determining organizational effectiveness. The assessment of how successful employees have been at meeting their individual goals, therefore, becomes a critical part of Human Resource Management. This leads us to the topic of Performance Appraisal.
This project aims at knowing ‘Performance Appraisal System” in this research has studied the work atmosphere and the welfare measures provided by the organization.
It also aims at finding out the employee’s relationship with the management.
This survey is done within the organization. The sample size is 110. The data was collected by administering questionnaire and by adopting direct personal contact method. The persons met are all employees of the industry.
Collections of data were analyzed and tabulated in a sequential manner and the interpretations are given along with the tabulation. The conclusion observations are also given in this report for the improvement of this system in the organization.
Key Words: Appraiser, Self – reliant, Appraisal, Judgmental, Distributive, Interactional
INTRODUCTION
The performance appraisal plays a vital role in identifying the productivity of workers; it also helps the company for its overall growth. It is the systematic evaluation of the performance of employees and to understand the abilities of a person for further growth and development. Performance appraisal is generally done in systematic ways which are as follows, the supervisors measure the pay of employees and compare it with targets and plans, the supervisor analyses the factor behind work performance of employees, and the employees are in the position to guide the employees for a better performance. In India, Textile Industry is one of the oldest and foremost industries and it provides tremendous opportunities for employment and huge amount as revenue. The Indian Government is also playing a major role in promoting the textile industries. Cotton is the most popular fiber and used to make clothing. Textile Industry is providing one of the most basic needs of people and it hold importance. Maintain sustained growth for improving quality of life. It has a unique position as a self-reliant industry, from the production of raw materials to the delivery of finished products, with substantial value-addition at each stage of processing; it is a major contribution to the country’s economy.

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TEXTILE INDUSTRY IN COIMBATORE:
Coimbatore is called the “South Indian Manchester”. The climate in Coimbatore city is very favorable for the development of textile industries. The easy availability of raw materials, sufficient skilled laborers, humid and soft wind prevailing in Coimbatore district are the other major factors for the development of the textile industry in Coimbatore. There are 98 textile firms in Coimbatore district in which few of the industry are taken into account for the study on the same. India has abundant natural resources in terms of availability of natural fibers like cotton, silk, wool etc. India is the third largest producer of cotton in the world and accounts for about 12% of the total world production. The availability of cheap cotton has been one of the biggest advantages to Indian exporters.
OBJECTIVES
To study about the employees’ opinion about performance appraisal.
To gain practical knowledge about the various factors that forms part of performance appraisal
To study about how they view the present appraisal method
To provide opportunities for the employee’s to express their ideas
REVIEW OF LITERATURE:
Mowday, R.T., Steers, R.M., Porter, L.M. 1979 an employee’s perception of justice in the performance appraisal process will also affect the effectiveness of the performance appraisal process. Justice is thought to have three categories, procedural, distributive, and interactional justice. In a performance appraisal setting, a lack of justice in one area is predicted to have the same effect as a violation of justice in all areas. If an employee perceives that the system processes are fair, the supervisor’s efforts to distribute rewards and punishments based on outcomes of the process, and that the employee is treated fairly, the employee’s perception of justice will be high.
Craig Eric Schneier and Richard W. Beatty, July 1979 Despite its standard practice in most public and private organizations for more than 50 years, performance appraisal still has many problems. Raters show resistance to criticizing subordinates, and the judgmental aspect of evaluating human performance is subject to both covert (subjective and individual) and overt (prejudice and bias) errors. Raters often aren’t trained in employee counseling and may be forced to conduct performance appraisals with inadequate or erroneous information about rate performance.
American Institutes for Research, Washington, D.C.: AIR, 1979 In a 1984 study in New England, 16 raters (Extension administrators designated by their state Extension director as having agent performance appraisal responsibility) completed EABRARS on 141 rural New England Extension agents.5 Reliability analysis of the total ratings indicated that EABRARS was an internally consistent, highly reliable instrument. Differences between New England agents were detected at the .05 confidence level with respect to age, subject-matter area, years of experience, and state of employment.
Nemeroff & Wexley, 1979 study shows that employees are likely to feel more satisfied with their appraisal result if they have the chance to talk freely and discuss their performance. It is also more likely that such employees will be better able to meet future performance goals. Employees are also more likely to feel that the appraisal process is fair if they are given a chance to talk about their performance. This especially, when they are permitted to challenge and appeal against their evaluation. Proper feedback has to be given about their performance to the appraises.
Robert M. Guion, the State of the Art, November 5-6, 1982, pp. 3-4Twenty years ago, nearly all civil servants in the central government of OECD member countries were paid according to service-incremental salary scales. This is not to say that civil servants previously lacked performance incentives. Promotions, and especially those into senior management, were rigorously controlled, serving partly as an incentive but partly also as a way of ensuring the independence of the public service with regard to the executive and thus its ability to serve governments of different political persuasions. Remuneration has been seen as an alternative or a complementary incentive to promotion. Socio-economic pressures have led to the need for types of incentives other than “promotion” to strengthen performance management.
Craig Eric Schneier and Richard W. Beatty, May 1988 To try to rectify some of the problems, Smith and Kendall developed Behaviorally Anchored Rating Scales, better known as BARS. The BARS format deals with measurable behaviors, not personality, provides raters and rates with clear statements of performance goals, and is based on a specific, thorough job analysis. Using BARS, raters focus on specific rate behaviors. These behaviors are compared to specific examples (job dimensions and anchors developed from the job analysis) that provide concrete benchmarks for making appraisal judgments. BARS are mainly used to measure the behaviors of rates.
Dulewicz (1989), “a basic human tendency to make judgments about those one is working with, as well as about oneself.” Appraisal, it seems, is both inevitable and universal. In the absence of a carefully structured system of appraisal, people will tend to judge the work performance of others, including subordinates, naturally, informally and arbitrarily.
This study, by Heneman, Greenberger & Anonyou (1989) reported that in groupers are subordinates who seem to be favored by their supervisors. In their relationship with the boss, they enjoy “a high degree of trust, interaction, support and rewards.”
Tsui, A.S. & O’Reilly, C.A. 1989 most studies focus on the performance appraisal where the supervisor evaluates his or her employees. In this paper, based upon two research projects, we look at both sides of the coin. In one study subordinates evaluated their supervisors, in the other one the focus was upon supervisors’ perception of their subordinates. The contribution aims to determine whether age-related stereotyping plays a significant role in performance appraisals. In both studies, it was determined whether the assesses age is negatively related with the assessor’s view on his or her competencies. Age is taken into consideration for appraisal rating in the above study.
Longenecker (1989) argues that accuracy in performance appraisal is impossible to achieve, since people play social and political games, and they protect their own interests. “No savvy manager…”, says Longenecker, “… is going to use the appraisal process to shoot himself or herself in the foot.”Accuracy in performance appraisal is a major drawback to the system.
Recent research (Bannister & Balkin, 1990) has reported that appraisees’ seem to have greater acceptance of the appraisal process, and feel more satisfied with it, when the process is directly linked to rewards. Such findings are a serious challenge to those who feel that appraisal results and reward outcomes must be strictly isolated from each other. Rewards and work performance are directly linked with each other.
METHODOLOGY OF THE STUDY:
The study was more of a descriptive in nature and it was the survey research design that was used in, by taking a sample of elements at one point of time. The researcher adopted this type of research design to systematically gather the information from the respondents for the purpose of understanding and predicting some aspects concerned with the performance appraisal system in their organization.
The sample unit of the study was 110 employees of Textile Company in Coimbatore
Primary data: Primary data has been collected through a structured questionnaire.
Secondary data: Secondary data has been collected from the books, journals, project reports and Internet.
Data was collected through structured questionnaire. The questionnaire was divided into three parts
First section dealt with the queries relating to the personal details of the employees
Second section dealt with the queries relating to the awareness about performance appraisal
Third section dealt with queries relating to views about the present appraisal system.
TOOLS FOR ANALYSIS:
The primary data for the study was collected through structured questionnaire and has been analyzed using percentages and represented by pie charts and bar diagrams are used wherever necessary. Mean score value has also been used.
1) Score value = No. of respondents*score
Mean score value = score value/No. of respondents
2) Percentage value = no of respondents/total no of respondent*100
CHI-SUARE [X2] TEST:
X2 test is based on the Chi- Square distribution and it is a parametric test. It is used for comparing a sample variance to a theoretical population variance. In a non- parametric test, no assumption about the parameters of the population is made. These tests have become very popular because, they can be applied in any type of distribution, they are easy to compute and they can be used in situations when parametric test cannot be applied.
Conditions to be satisfied for applying chi-square test
Data should have been collected at random.
Items constituting the sample should be independent.
The total number of items should be at least 50.
From the chart above it is understood that most of the employees in textile industry fall under the category of the age group between 46-55 years and also most of the employees are from the under graduate background.
TABLE INDICATING THE YEARS OF SERVICE AND THE INCOME OF EMPLOYEES:
From the chart above it is clearly understood that the workers with more than 10 years of experience only earning a return of Rs. 8001 and more. The employees with more years of service are expected to perform well as they have very good experience in their work.
FACTORS INFLUENCING PERFORMANCE APPRAISAL
The ranking of factors given by the respondents show that behavior with peers, dependability, behavior and attitude towards superiors, initiative, and attendance were ranked very high. They felt those factors have to be given higher weightages in the appraisal form. There are respondents who have ranked quality of work and cooperation on lower side. There were respondents who felt that all the factors in the appraisal system should be given equal weightage and there was no meaning in awarding high weightages to few factors.
OPINION ABOUT THE PERFORMANCE APPRAISAL RATING
The above table clearly shows that opportunities to increase job satisfaction, need of appraisal for employee, encouragement by raters and knowledge about the appraisal system, are high for employees. Assistance by organization, monetary reward unbiased assessment and satisfaction with the present system were rated average. This may be due to reasons like the employees are not given feedback about their performance since it is maintained confidentially. But the need of appraisal, knowledge about system, encouragement and opportunities to employees were rated high because they want to know about their work performance.
CHI-SQUARE ANALYSIS
GENDER AND YEARS OF SERVICE
TEST STATISTIC:
Null hypothesis (Ho): There is no significant relationship between gender and years of service.
Alternative hypothesis (H1): There is a close relationship between gender and years of service.
RESULT:
The result that the calculated value is less than the tabulated value, we accept the null hypothesis. Therefore, there is no significant difference between the gender and years of service.
MARITAL STATUS AND MONTHLY INCOME (in Rs)
TEST STATISTIC
RESULT:
The result that the calculated value is more than the tabulated value, we reject the null hypothesis and accept the alternative hypothesis. Therefore there is a significant difference between the marital status and monthly income.
CONCLUDING OBSERVATIONS:
From the study it if found out that, most of the respondents feel that the appraisal system creates confidence and hence increase the production level of the employees which in turn will increase their income in one hand. Many employees in the textile industry are not aware of the errors that is caused by performance appraisal like halo effect, horns effect, central tendency and leniency. Majority of them have no idea about errors and its types in the appraisal system. Good training can help improve the appraisal system to prevent errors while rating. Raters are expected to observe the performance in order to judge ones effectiveness and skill in the work condition. Also the superior should avoid bias in appraising their subordinates. The system could be made open to a possible extent and discussions could be encouraged. The employees can come to know about their performance appraisal, how are they rated and what other improvements they can do to their performance. The organization might take up steps to arrange discussions and make the employee aware of how he is getting along and what improvements he needs, where and how he can best utilize his capabilities and skills. Most traditional methods emphasize either the task or the personality of the individual while making an appraisal. In such evaluations, bias always prevails. To bring about a balance the evaluation of task and personality and the modern methods of appraisal by results of MBO can be used.
Performance appraisal motivates employees and influences their productivity and ensures that they are producing at acceptable levels. Performance evaluation system could be linked to company objectives to get better results and good performance of the employees. Effectiveness of any appraisal system depends on how all the users of the system understand the purposes, accept and strive for achieving them. For designing any system, employee and managerial performance should be taken into consideration. From the study, it is found that feedback to the employees is not proper in the organization. Periodical and routine feedback can be given to the employees for their good performance in the work, which motivates the employee to enrich the relationship between the superiors and subordinates.
 

Private Sector Participation in Water Supply

ASSESSMENT OF PRIVATE SECTOR PARTICIPATION (PSP) IN WATER SUPPLY IN ABRAKA AND ITS ENVIRONS, DELTA STATE, NIGERIA
S. I. Efe
Department of Geography and Regional Planning
Delta State University, Abraka. Delta State, Nigeria
ABSTRACT
This study assessed the level of private participation in water supply in Abraka and the likely problem militating against their effective operation. This study involved personal field observation and questionnaire survey to all the private owners of water projects in Abraka. This gives a total of 188 questionnaires administered. The data collected were presented in tables and statistical diagram. Percentages were also us ed for the data analysis. The result revealed a high level of private participation in water supply in Abraka. This is evident from 188 out of 202 functioning water projects in Abraka, thus. it indicate that over 93% (percentage) of water projects in Abraka are owned by private individuals. The operators are however faced with the problem of epileptic power supply, hike in pump process of fuel (diesel and petrol, theft and maintenance cost, it is therefore recommended that Abraka should be linked to the national grid and more feeder transformers should be supplied to Abraka communities 4.y Delta State government. Government should also resuscitate the existing public water system in Abraka to minimise the money spent on water by Abraka inhabitants.
Keywords: Private Sector, Participation, Water Supply, Abraka
INTRODUCTION
The supply of water to the inhabitants of urban areas has been the responsibilities of Local, State and Federal government. As such, there has been pressure in government resources and the government can no longer foot the servicing and maintenance of many socio infrastructures in the countries (Adesuyi, 1996). For instance in Nigeria many hydraulic facilities have been incapacitated and break down completely because of pressure from the increasing population of cities without corresponding expansion or maintenance in these water projects. And some even breaks down soon after commissioning (Efe, 2003). In Abraka its population has increased from 5,006 in 1985 to 57,444 in 1998, and it’s projected to increase to over 66,738 by 2005 and there is no expansion in the existing water facilities. Presently little could one identifS’ any government owned water project that provide water effectively and regularly to the inhabitants of Abraka, except dilapidated overhead tanks. Thus there has been acute shortage of water supply to Abraka communities. As such, the inhabitant now trek long distance at an average of 1-3km to river Ethiope and Ovwuvwe to get drinking and other domestic water, there they bath and do most of their washing (Plates, Clothes ete). Because of this problem there are complains by the inhabitants to government and private individuals, but there was no change of operational attitude by government. However, there has been large increased in Private Sector Participation (PSP) in water supply in recent times in Abraka. This view has been noted Oyebande (1981), Adesuyi (1996) and John (2002). So the private individual seize this opportunity to drill boreholes in their compound for personal use and commercial uses as well. Though the price of water is on the high side for example 20 litres can cost as high as N5.00 to N8.0O in most of the communities. Recently the government of Delta State came out with a policy that every borehole owners should come to the state capital to register with Nb, 000.00 for commercial bores and N3,500.00 for private and pay an annual subscription rate of N2,500.00 and NI,500.00 for commercially and privately owned bore holes in the state. But the owners of these private boreholes are hesitant to register and pay the said amount saying that water is a free gift of nature, and the government who suppose to provide water has failed, and even electricity to power their submersible pump government is not providing, why then is the demand for registration. Based on the foregoing, this study is aimed at assessing the level of PSP in water supply, the willingness of the private sectors to register and pay the annual subscription and to identify the limiting factors militating against effective PSP in water supply in Abraka.
STUDY AREA
Abraka is located between latitude 5°45’ and 5°50’ North of the equator and longitude 6° and 6° 15’ East. It covers an area of 168.43 sqkm, and a height of 45m above sea level. It is drain by two rivers, River Ethiope to the West and River Ovwuwve to the south eastern extent at the landmass. It has a gentle slope to the two rivers. The area is made of loamy and sandy soil (Efe and Aruegodore, 2003). Abraka fell within the tropical environment that enjoys the tropical rainforest climate (AF) of Koppen in 1919 and the wet equatorial of Strahier in 1969.Generally speaking, Abraka and its environs had an annual mean temperature of 3 0.6°C, and mean monthly temperature that span from 30°C in September to 31.1°C in June and July. The area experiencing heavy amount of rainfall that spans for 12 months period. Annual rainfall generally ranges from 2,703mm in 1977 to 3,647mm in 1989. However, the annual mean rainfall is 3,098mm. This indicates that Abraka experiences heavy and torrential rainfall throughout this period. The mean monthly distribution of rainfall in Abraka span 25.8mm in the month of December to 638.9mm in September. This indicates that December recorded the lowest rain amount while September recorded the month with the highest rainfall amount; as such there is no distinct dry season. In recent time Abraka has witnessed a rapid population increased, from a population of 55 510 during the 19991 Census, to estimated population value of 60 000 in 2004.This is as a result of the increase in the population of Delta State University students. This increase has also led to rapid urban development and without commensurate growth in infrastructural facilities of the areas.
MATERIALS AND METHODS
The research designed employed in this study involves a field survey of personal observation and questionnaire administration to all the operators of bores in Abraka. Abraka was stratified into five zones based on the 5 political delineation (wards) already in existed. The researcher and 20 of his field assistants (hydrology students) visited each of the zones at five different occasions between March — May 2005 (one zone each ‘thy) to count the total number of hydraulic project existing in them and to administered questionnaire to each of them. The researcher waited for them to fill them and collect the questionnaire at the spot from them. The questionnaire covers the following; when the bores are sunk, the owner’s cost (prices) of water supply and their willingness to register with government and pay the annual water rate fees and likely problem encountered during operation. This took us to Umeghe, Uhuoka, Ekrejeta, Abraka urban, Ajalomi, Urhuovie, Erho, Oria waterside, Ovwodo, Ekreseme, Urhuagbesa, Otorho and Ugono. A total of 188 questionnaires were administered to the 188 private operators of boreholes in Abraka. The data collected re summarised in table 1 —4 and expressed in percentages.
RESULTS AND DISCUSSION
The results from the field observations are presented in table 1,2,3, and 4 and discussed below:
Table 1: Number of water projects in each community and their owners

S/N

Zone 1

Private

Community

Government

NGO

Total

1

Abraka urban

63

 

3

2

68

2

Ekrejeta

26

 
 
 

26

 

Zone 2

 
 
 
 
 

3

Urhuoka

34

 
 
 

34

4

Otorho

1

 
 

2

3

5

Ugono

1

 

3

 

2

 

Zone 3

 
 
 
 
 

6

Ajalomi

2

 
 

1

3

7

Erho

8

 

1

 

9

8

Urhuovie

10

1

2

 

13

 

Zone 4

 
 
 
 
 

9

Umeghe I, II

10

 
 
 

10

10

Urhuagbesa

1

 

1

 

2

11

Ovwodo

12

 
 
 

13

 

Zone 5

 
 
 
 
 

12

Ekreseme

3

 
 
 

3

13

Oria waterside

16

 
 
 

16

 

Total

188

1

8

5

202

Source: Author’s fieldwork, 2005.
Table I showed that a total of 202 hydraulic projects (bores) were located in all the communities in Abraka and its environs, Abraka urban (town), which housed the Delta State University recorded the highest concentration of bores, with a value of 68, out of which 63 hydraulic projects were owned by private individuals, 2 owned by non-governmental organisation and 3 owned by governmental They are sited at Delta State University to serve the need of staff and students on campus. This signifies 93%, 4% and 3% respectively lhr private, government and nongovernmental organisation. The 3 governments owned bores were sited at Delta State University, Abraka. Urhuoka and Ekrejeta follow this with 26 with 34 bores owned solely by private individuals respectively. Others are Oria waterside, Urhuovie, Ovwodo and Umeghe with 16, 13 and 109 bores respectively. At Oria waterside, Ovwodo and Uineghe all the boreholes are owned by private individuals, while at Urhuovie, out of the 13 water project, 10 are owned by private, 1 by community effort and 2 by government. These showed that private individuals own 77% of the water projects at Urhuovie. While the community and government own 8% and 15% of the bores respectively. The rest communities on table 1 showed less than 8 bore with the exception of Erho with 9 bores (8 private and 1 government owned). Generally, out of the 202 bores that is presently located in Abraka and its environs, 188 are owned by private individuals, 8 by government. 5 by non — governmental organisation and I by community effort (see fig 1).Fig.1: Operators of Bores in Abraka
Source: Author’s fieldwork, 2005
This showed that there is a high level of PSP in provision of water to the inhabitants of Abraka. Thus water supply in Abraka is mostly under the auspices of the PSP. The reason for increased PSP in water supply according to the operators of the bores is that; government has failed in its entirety in providing this basic necessity of life to the ever increasing population of Abraka, and also to make life better for their own people in Abraka and the student who resides off campus, lastly because of the fact that all the water projects owned by urban and rural water board in Abraka have packed-up and no attempt by the government to repair them. Most water from the private bores in Abraka urban is connected to hostels for students use. For instance out of the 68 bores located in Abraka main town; 35 were connected to hostels, where majorities of the inhabitants are students, 25 sunk solely for commercial and household use, while 8 have been connected to private homes similarly 135 (over 71%) of the 188 water projects in Abraka and its environs, are used for commercial purpose (see table 2). Some owners of these bores also have their house connected to their owned bores.
Table 2: Types of bores in Abraka

Private

Commercial

Total

Percentage

53

135

188

70

Source: Author’s fieldwork, 2005
On the other hand, less than 30% of the privately owned boreholes were connected to private houses and solely for private uses. However most of the boreholes were sunk between 2000 and 2005 respectively. For instance, out of the 202 functioning water projects existed presently in Abraka 153 were sunk between 2000 – 2005 while 49 were sunk during or between 1989 — 1999 (see table 3)
Table 3: Years bores were sunk

Private

Commercial

Total

Below 1989

15

Non-functioning or packed – up few year after commissioning

1989 — 1999

51

49 that are privately owned are functioning while the one owned by government at Abraka urban and Erho are packed up.

2000—2005

153

All functioning

Total

219

202 functioning and 17 non-functioning.

Source: Author’s fieldwork 2005.
Table 3 also showed that out of the 219 water projects seen in Abraka, 15 were sunk before 1989, 51 in 1989 and 1999, and 153 between 2000 and 2005. Out of these, 17 are bad and stop functioning few years after commissioning; Leaving 202 bores. According to the inhabitants, most of these packed-up projects sunk by petroleum trust fund (PTF) during the Babagida regime. However the year 2004 witnessed rapids sitting of bores in Abraka. For instance the field observation revealed that a total 58 bores were sunk in 2004 alone. Presently there are 23 drilled bores not yet connected to the overhead tank (i.e. they are still under construction) when asked they said they occasionally pump water from these bores for block moulding and building of houses. The owners of these bores capitalised on the non-existence of public tap to increase the price of water in the area. For instance, 20 litres of water is sold as high as 5.00 — N8.00 in some communities (most especially in Abraka urban). An interview with some of the inhabitants seen buying water from these sources revealed that though these privately owned bores have really alleviated the problem of water shortage in Abraka, because of their short distances and efficiency, but the price of the water is very high. For instance the price of 20 litres can cost as high as N5.00 or N8.00 on the average in most of these communities. Due to this high price most households have to down size the quantity of water use per day and ‘whenever it rains, they fill all available bowls with rainwater, and little quantity of about 20 litres for drinking is usually bought from the private bores. The interviewed also revealed that high proportion of the bores owners in Abraka are willing to pay and register with the Urban Water Board provided the government of Delta State could provide regular supply of electricity to their communities. This is evident from 153 out of the 188 private bores owners who indicated their willingness to register with the Urban Water Board at Asaba (see table 4)
Table 4: Number of bores owners who are will to register with government

Source: Author’s Fieldwork, 2005
Their justification of willing to pay is that ground water is one of the natural resources that are owned by the government, and anybody extracting natural resources pays certain amount of money to the government. The operators of the bores outlined the following as a limiting factors in order of severity; epileptic power supply, high prices of diesel and fuel, theft and maintenance cost. They all generally stressed that because of the epileptic power supply they no longer depend on electricity (NEPA) rather on generating plants to power their water project, and that the prices or diesel and petrol have further increased the running cost, which they shifted to the consumer. Thus a change in the price of 20 litres cans from N2.00 to N5.00 or N8.00 depending on the circumstances. Similarly, because of the high rate of insecurity most of the submersible pump have been lost to theft, and now they engages the services of security men to guard these water pumps, which according to them cost as high as N4, 500.00 or N7, 500.00. They therefore call on the government of Delta State to provide more transformers, in Abraka or if possible linked Abraka to the Ogorode power line, since it will serve the Main Campus of the Delta State University, Abraka. The major problem militating against effective water supply to the inhabitants of Abraka are ascribed to high cost of hydraulic equipment and drilling of the bores, epileptic power supply, theft and the recently introduced 1 0, 000 and N3, 500 bores registration fees by the Delta State government.
CONCLUSION
This study has been able to show that there is a high rate of PSP in water supply in Abraka. Out of the 202 functioning water project in Abraka 188 are owned and maintained by private individuals. The study also revealed that 188 privately owned bores, supply water regularly to the inhabitants of Abraka, though the price of N5.00 — 8.00 is on the high side. The problem of epileptic power supply and theft are major limiting factors to effective water supply. It is therefore recommended that Abraka community should be regarded as a priority or special area and linked to the national grid or Ogorode power supply. When this is done it will enhanced regular power supply that will better the entire life being of the residents of Abraka.
REFERENCES
Adesuyi, D. (1996), Nigeria Produces 25 year water Master Plan. Ultimate Water Technology and Environment 1(1): 17-19pp.
Efe S.I. (2003), Water quality and its utilisation in the Nigerian rural setting of Abraka Delta State International Journal of Ecology and Environmental Dynamics Maiden (ed) 81-86;;.
John, T. (2002), Opinion World Summit of Sustainable development, private sector participation in the water sector in the water sector published by international institute for environment and development U.S.A., UK.
Oyebande, L. (1981) The hydrology of water supply: A case of Jos in P.O. Sada and J.S. Oguntoyinbo edited Urbanisation Processes in Nigeria, Ibadan University press. 141-149.
 

Formation and Impact of the Informal Sector

What is the informal sector? Explain its formation and its persistence despite substantial economic change in cities in late industrializing countries. What would formalizing the informal sector mean in practice? What might be the role of the state? Provide evidence where formalization has/has not worked and offer some reasons why that was case.

Introduction

The informal sector in majority of the developing countries represent approximately 50% of the entire economic activity. It sustains and provides livelihood to a large majority of people, notwithstanding that, the part it plays in overall economic development remains contentious (Porta and Shleifer, 2014). It is observed that although this sector is widespread in the developing countries, it has relatively low productivity compared to the formal sector, mostly concentrated with poor and less educated entrepreneurs and is largely disconnected from the formal sector. The reason why many entrepreneurs tend to set up small scale firms in the informal sector is the avoidance of taxes and regulations and because they are aware that the productivity of their firms are quite low and would not allow them to thrive in the formal sector (Porta and Shleifer, 2014).

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According to Peterson (2013), a cursory glance at the informal sector reveals that it is not problematic at all in the short run, as it tends to be the primary source of livelihood and sustenance for the poor. However, in the long run it has an adverse effect on a country’s economy and can stagnate the government’s social programs. If informal sector growth remains uncontrolled, this mean an economy that is beyond the control of the government or regulatory agency would not be able to provide the necessary protection to the workers and workers will continue to have lower standards of living compared to their counterparts in the formal sector. The reasons the workers in the informal sector continue to have low living standards are irregularity in their working days, absence or lack of minimum wage, lack of health and safety facilities, inability to enforce the contractual arrangements and absence of social protection (Peterson, 2013).

In this paper, I argue that despite the fact that the informal sector provides means of sustenance for the poor and relatively less educated it has numerous disadvantages and steps should be taken by the state towards formalization of the sector. The paper looks at the informal sector in Pakistan and why inequality persists in the opportunities for the workers in this sector. The informal sector’s growth should be curtailed in the developing countries because 1) informal sector workers have very low level of protection from the police and judiciary in case of crimes committed against their property 2) as most of the informal sector workers do not possess the capacity to enter into binding contracts, this prevents them from accessing capital markets for the purposes pertaining to finance and insurance and they are also not able to fully make use of social welfare, skill enhancement training programs and other government/public incentives (Loayza, 1999).

In this paper, I will begin with first explaining what the informal sector entails and what are its key characteristics. I will go on to discuss the emergence and persistence of this sector focusing primarily on two issues that in my view have contributed to this sector i.e. globalization/trade liberalization and poverty. I will look at the informal sectors in Pakistan and India to some extent as my case studies to explain what formalization of the informal sector means and what could be role of the state in that regard. The conclusion will reiterate that although informal sector is not entirely unfavourable for the poor, it could have negative impact on the economy in the long run.

 

The informal sector: what is it?

There is no definitive and conclusive single definition of the informal economy, however, the work of Hernando de Soto (1989) defines informal economy “as the set of economic units that do not comply with government imposed taxes and regulations” (Loaya, 1999:1). It appears that defining the informal sector has been a contentious and debatable issue. The consequence of the debates over the informal sector has resulted in four dominant schools of thought including the Dualist school, the Structuralist school, the Legalist schools and the Voluntarist school. According to the Dualists, the informal sector consists of marginal activities very different from the formal sector and not related to the later at all. The Dualists are of the view that the informal economy is a means of livelihood for the poor and something to fall back upon in financial upheavals (Hart 1973, ILO, 1972, Chen, 2012). The Structuralists believe that informal sector consists of micro-enterprises and workers that play a key role in reducing the input/labour costs, thus, facilitating increased competitiveness of big capitalist firms (Castells and Portes, 1989). The legalists such as DeSoto refers to informal sector consisting of micro-entrepreneurs who choose to function informally to avoid the cost and time incurred registering formally. All they require is property rights to ensure that their assets are converted to and recognized as legal assets (De Soto, 1989, 2000). The Voluntarist school tends to focus as well on the entrepreneurs striving to avoid taxes and regulation, however, compared to legalist school they do not put the blame on the burdensome procedures of registration (Chen, 2012).

It appears that the activity-based definitions around informal economy have gained ground in the recent past. The OECD, IMF and ILO reiterates that the informal sector includes “all legal activities that are deliberately are deliberately concealed from public authorities for the following reasons: to avoid payment of income, value added or other taxes; to avoid payments to social security contributions, to avoid having to meet certain legal standards such as minimum wages, maximum hours, safety or health standards etc…” (OECD, 2000:139, Gurtoo and Williams, 2009:2).

The emergence and persistence of the informal economy

 

During 1950’s and 60’s it was acknowledged that there exists a dichotomy between urban economies, that is, along with the organized industries an unprotected and unorganized sector also subsists. This sector was first identified as an‘informal sector’by Hart (1971) and owing to the introduction of this sector as an informal economy the activities that were not incorporated in theoretical models of development were finally made a part of it (Chaudhuri and Mukhopadhyay, 2009). The informal sector was initiated at the launch ILO World Employment Programme and as a result of the ILO Kenya Report (1972). A major portion of ILO’s work on informality sees it as correlated to poverty. In this section I will be referring to globalization and rampant poverty being the reasons for emergence and persistence of informal economy.

Globalization and the informal economy

Chaudhuri and Mukhopadhyay (2009) state that globalization and the major forces that drive it i.e. trade liberalization are considered to be the key reasons for the large number of workers in the informal economy. The term ‘globalization’ refers to reduction in barriers to trade, liberalization of the external flows of capital and international labor migration. The literature on the informal sector depicts that the way the workforce is becoming increasingly casual in nature is to some extent owing to the liberalized regime. How? It is argued that owing to enhanced market competition and uncertainty as a result of globalization, the entrepreneurs are moving towards higher capital-intensive productions and that results in laying-off human labor force. Many people who are laid off cannot afford to remain unemployed and hence seek employment in the informal sector. Another reason why globalization perpetuates informal sector is that in order to curtail costs and remain competitive, some entrepreneurs prefer subcontracting some stages of their production process to informal sections that can assist them in minimizing training and maintenance costs of labor force (Chaudhuri and Mukhopadhyay, 2009).

It is established that the major shortcoming of globalization is that even more people are ‘self employed’ today compared to pre-globalization era. Yet, being self-employed does not depict that the workers’ conditions are ideal. In fact, a fundamental portion of the burgeoning workforce finds itself in casual, contractual, home-based, own-account and migrant work within the informal sector having no social security. Although globalization has led to the proliferation of the informal sector, with the support and help of trade unions such as Self Employed Women Association (SEWA) the women working in the heterogeneous informal sector are lent support to earn and lead better lives and become more empowered (Kapoor, 2007). The point I am trying to make here is that notwithstanding the impact of globalization on expansion of informal economy trade unions and organizations like SEWA can play a part in making globalization work for the informal sector workers. How SEWA is making globalization work for the informal female workers? The case of Puriben Ahir explains that. She is from Gujarat in India and was working as a farmer but had no means to deal with enhanced mechanization, the new yielding seeds that didn’t go along with her drough-prone farms. The irregular nature of her work and frequent migration became her way of life. She then decided to join SEWA. Upon joining it she was not only able to raise her financial status and her status in the family and the community was also elevated. Through SEWA she also gained access to the market and was able to tap the national as well as international markets. This depicts that if dealt properly informal sector emerging due to globalization can be tackled and its adverse effects could be curtailed (Kapoor, 2007).

Poverty and informality

It is argued that one of the key characteristics of the informal sector is poverty and that there is a strong nexus between poverty and informal sector participation (Mead and Morrison, 1996). In order to provide an insight to this argument I will look at the case of India. The literature on informal economy in India suggests that during the years 1999-2000 and 2004-05, the following four states had the largest share of the informal sector Bihar followed by Uttar Pardesh, Rajistan and Orissa. It is also observed that poverty is more prevalent in these four states of India compared to the others. The incident of poverty in these states is quite higher than the national average. Thus depicting that there is a positive correlation between poverty and informal sector (Naik, 2009).

Mead and Morrison (1996) state that despite the belief that a strong relation exists between poverty and informal sector there is a contrary view stating that there does not exist any data set that allows anyone to make the assumption around poverty-informal economy nexus. According to Cartaya (1994) while studying the levels of income for informal workers in Venezuela the association between informal sector and poverty is not definite and conclusive. She argues that there are many poor households with downtrodden workers not a part of the informal sector. Simultaneously there are numerous people in the informal sector who are not poor. In a nutshell it will be misleading to see poverty as a defining feature of the informal sector although some level of association do exist between poverty and informality (Cartaya, 1994).

The informal sector and the role of the state: the case of Lahore, Pakistan

In this section, I will be analyzing the informal sector in Lahore, Pakistan. My analysis will be based on the research study commissioned by WIEGO and Inclusive Cities project in which I was involved being an employee and a part of the “Informal Economy Budget Analysis” project in Shirkat Gah, a leading women rights organization in Pakistan. I will study how the informal sector workers located in Shahdara, Ravi Town in Lahore operated under informality and if the working conditions were too precarious. I will look at whether Pakistan’s government is able to lend protection to the workers in this sector primarily to the waste pickers and the home-based workers. Finally I will delve in to why the state has not been successful in affording protection to these workers and what prevents formalization from taking place in the country.

Overview of informal sector in Lahore, Pakistan

In Lahore, a majority of urban workforce is informal. Notwithstanding that, it is observed that in many cities in Asia, Lahore being one of them, the informal sector and their livelihood are overlooked or at times totally ignored in city planning and economic development at the local level. The major dilemma for the informal sector workers in Pakistan is their exclusion from economic policies and city/urban planning. The urban informal workforce and the working poor in Lahore are often not recognized and supported by the city authorities and ignored when the city is developing economic land allocation and zoning plans. In Lahore, many informal sector workers toil for hours in deplorable working conditions and exploitative practices (Lean Lim, 2015).

The profile of Shahdara, Lahore

Ravi town is among the nine towns in Lahore. Shahdara is a huge and busy Union Council located close to a huge waste dump in Lahore. The town recently experienced urbanization as a result many migrant from rural areas of Pakistan had settled down there (Budlender, 2009).

Informal sector workers in Shahdara, Lahore

The research conducted in Shahdara by Shirkat Gah employees through dialogues and engagement with random homes-based workers and waste pickers depicted the following trends. It was revealed that waste-picking was mostly undertaken by the families of Afghan refugees who migrated to Pakistan as a result of being displaced during the Afghan war. The refugees were residing in the slums near Lahore and in their waste picking work both their children and wives were involved. The reported family income of these waste pickers is between Rs. 6000-8000 per month not enough to sustain the families (Budlender, 2009).

Moreover, the home-based workers in Shahdara were mostly found to be women. Most of these women do not have attained high levels of education (studied only up to grade 5) and usually work on piece-rates receiving abysmally low wages and sporadic incomes. Most of the female home-based workers interviewed in Shahdara were engaged in sewing, embroidery, carpet weaving, making henna cones and cooking. The sewers who work as part-time employees in people’s home have irregular flow of income as their orders reach their peak during Eid and wedding season and slow down during other days (Mumtaz et.al, 2009). The home-based workers are predominantly females, 65% of women are in this sector as apposed to 4% of men. Within Lahore, a stark inequality and disparity was observed between the women and men in the informal sector. The female home-based workers were subjected to increased inequality compared to their male counterparts as they were required to work for much longer hours for a reasonable amount of income. Moreover due to the patriarchal society of Pakistan most women had no control over spending the wages they had earned and at times were abused and exploited by their male employers or men in their family (Mumtaz et al, 2009). Hence (Chen et al; 2004) believes that if women in the informal sector are given due support by the state or steps are taken to formalize the informal nature of their work it would result in ameliorating poverty and gender inequality.

Dilemmas of the informal sector workers in Shahdara, Lahore (Chen and Sindha, 2016)

Evictions and relocation of homes away from contractors, markets and customers. This could be addressed by upgrading informal housing and settlements

Many home-based workers who work from home lack quality and spacious housing. As many of them live in small houses, they are unable to take orders in bulk owing to a lack of storage space. The space they live in has completing needs of other activities and members of house. Some houses not built with high quality face rooftop leaks during monsoon rain that hampers and impedes the working and productivity of these workers.

Some workers are faced with the dilemma of high rents and scarcity of affordable housing

Right to basic infrastructure: Consistent power failure in Lahore and high cost of electricity. Power outages are a major worry for the home-based workers engaged in sewing clothes as they rely on electrical sewing machines. Lack of water and sanitation issues in Shahdara.

Inadequate public transport: At times home-based workers have to leave their homes for work and thus complain about high cost and lack of round the clock availability of public transport in Lahore

Lack of secure a secure and transparent contracts

Occupational, health and safety issues such as being exposed to toxic substances and long hours with very little rest time

The formalization debate: Has formalization been achieved in Lahore and what role has the government played in achieving that?

 

Pakistan is increasingly faced with the challenge to manage its informal sector, as this sector is draining the country’s formal economy. The Center for International Private Enterprises (CIPE) and the Lahore Chamber of Commerce is taking the initiative to encourage informal workers to become a part of the formal sector (Dawn, 2011). At this point it is pertinent to explain what formalization is all about. The process of formalization refers to shifting informal workers to formal wage jobs and this could be made possible when the government of Pakistan is able to create more jobs and do away with the phenomenon of ‘jobless growth’. However, there is no precise definition of formalization and for some the term simply means ensuring registration of informal enterprises and taxing them (Chen, 2012).

The need of the hour for the government of Punjab to address the issue of burgeoning informal sector is to ensure that it registers and taxes formalized enterprises, provides homes-based workers and waste pickers with access to legal and social protection. In the case of home-based workers, it would be ideal if technical and vocational training institutes could impart trainings to home-based workers and build their capacities. Moreover, the government of Punjab needs to ensure that they are represented in the relevant collective bargaining process and policy making.

Practical steps that the government of Punjab could adopt for formalization of some of the informal workforce (Williams and Lansky, 2013)

Advertise and impose penalties for informal sector workers

Simplify compliance rules for entering formal sector

Promote benefits of formal work and educate the workers in the informal sector

Ensure tax fairness

Ensure principles of equality and non-discrimination

Enhance social protection measures

Lower cost to access the formal sector

Create more jobs in the formal sector

Ensure access to basic infrastructure

Do away with biases against labor, biases that privilege capital (Carr and Chen, 2004)

     Biases against the informal workforce

     Biases against women favoring men

Has formalization completely failed in Pakistan?

 

In my view, despite the prevalent informal economy, the process of formalization is not an utter failure in Pakistan. According to the Dawn (2011), the State Bank of Pakistan introduced the Credit Guarantee Scheme for commercial banks to ensure coverage of default risk of borrowing businessmen and that includes the informal sector-to 60% of first loss. Moreover, informal enterprises in the manufacturing sector are encouraged to use the testing, standardization and quality assurance facilities of the government in order to enhance the capacity of product and market development. The attempt towards formalization in Pakistan especially Punjab is not an utter disappointment and this could be gauged by the fact that newspaper deliverers in Pakistan have organized themselves i.e. previously they were a part of the unorganized sector (Dawn, 2011).

Conclusion

 

The discussion in this paper highlights that the two leading factors of emergence and persistence of the informal sector in Pakistan are globalization/trade liberalization and poverty. Although it is also argued that it will be wrong to believe that all worker sin this sector are poor or that poor workers are only found in this sector. However, we have also seen that in Shahdara the majority of the home based workers were females from low economic standing that is why they were forced to work and earn wages through piece rate.

The informal sector is not an utter disaster as it does provide means of livelihood and sustenance to the people belonging to impoverished backgrounds, however in the long run it could strain the formal economy as well and hence steps should be taken by the governments of the developing countries towards formalization. In my view, although the state of Pakistan is working towards formalizing its informal sector, it still has a really long way to go. It needs to focus on the persistent inequalities that exist between women and men and different economic classes within the informal sector and ensure that its policies and law take into account the contributions made by the workers in the unorganized sector.

 

 

REFERENCES

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Budlender, D., 2009. Informal Economy Budget Analysis in Pakistan and Ravi Town, Lahore. Lahore: Women in Informal Employment Globalizing and Organizing.

Carr, M. and Chen, M., 2004. Globalization, Social Exclusion, and Work: With Special Reference to Informal Employment and Gender.

Cartaya, V., 1994. Informality and poverty: Causal relationship or coincidence?. The informal Sector Debate in Latin America State University of New York Press, Albany, NY, pp.223-250.

Chaudhuri, S. and Mukhopadhyay, U., 2009. Revisiting the Informal Sector. Springer.

Chen, M.A. and Sinha, S., 2016. Home-based workers and cities. Environment and Urbanization, 28(2), pp.343-358.

Chen, M.A., 2012. The informal economy: Definitions, theories and policies (Vol. 1, No. 26, pp. 90141-4). WIEGO working Paper.

Chen, M.A., Vanek, J. and Carr, M., 2004. Mainstreaming informal employment and gender in poverty reduction: A handbook for policy-makers and other stakeholders. Commonwealth Secretariat.

De Soto, H., 1989. The other path (p. 17133). New York: Harper & Row.

De Soto, H., 2000. The mystery of capital: Why capitalism triumphs in the West and fails everywhere else. Basic Civitas Books.

Gurtoo, A. and Williams, C.C., 2009. Entrepreneurship and the informal sector: some lessons from India. The International Journal of Entrepreneurship and Innovation, 10(1), pp.55-62.

Handbook, O.E.C.D., 2002. Measuring the Non-Observed Economy.

Hart, K., 1973. Coiner of Term “Informal Sector” Late 1960s Study in Accra, Ghana. Informal Income Opportunities…., the journal of modern african studies, 11(1), pp.61-89.

Kapoor, A., 2007. The SEWA way: shaping another future for informal labour. Futures, 39(5), pp.554-568.

La Porta, R. and Shleifer, A., 2014. Informality and development. Journal of Economic Perspectives, 28(3), pp.109-26.

Lean Lim, L. (2015). Extending Livelihood Opportunities and Social Protection: To empower poor urban informal workers in Asia. [online] Wiego.org. Available at: http://www.wiego.org/sites/default/files/publications/files/Lim-InformalityReport-Asia.pdf [Accessed 28 Oct. 2018].

Loayza, N., 1999. The economics of the informal sector: a simple model and some empirical evidence from Latin America. The World Bank.

Mead, D.C. and Morrisson, C., 1996. The informal sector elephant. World development, 24(10), pp.1611-1619.

Mumtaz, K., Saleem, N., Shujat, S. and Qureshi, J., 2010. Informal economy budget analysis in Pakistan and Ravi Town, Lahore. Women in Informal Employment: Globalizing and Organizing (WIEGO). Retrieved from.

Naik, A.K., 2009, September. Informal sector and informal workers in India. In Special IARIW-SAIM Conference on ‘Measuring the Informal Economy in Developing Countries’ September (pp. 23-26).

Peterson, K., 2013. The Informal Sector: Plague of the Colombian Economy.

The Dawn (2011). How to formalise informal sector. [online] Available at: https://www.dawn.com/news/681607 [Accessed 28 Oct. 2018].

Williams, C.C. and Lansky, M.A., 2013. Informal employment in developed and developing economies: Perspectives and policy responses. International Labour Review, 152(3-4), pp.355-380.

 

Analysis Of Financial Statement Of Telecom Sector

Our analysis as a part of management accounting course in MDI, aims at financial analysis of two distinct companies of Telecom sector of India. Telecom sector is one of the fastest growing sectors and has shown the growth of 9.1% in Q2 of financial year 2009-2010 whereas GDP growth of India has been 5.8%.
We have done a comparative analysis of the balance sheet, income & cash flow statements of “Bharti Airtel” & “MTNL”. Key ratios are generated and analysed for short-term and long-term investing, short-term and long-term lending and suggesting a comprehensive strategy.
Accordingly, we have included balance sheet, income & cash flow statements of “Bharti Airtel” & “MTNL” over a period of 5-years in appendix used for data analysis.
Telecom Sector: An Introduction
Telecommunication is the assisted transmission over a distance for the purpose of communication.
The broad segmentation of Indian Telecom Sector can be done on the following basis:
Telecommunication Services
Basic service
Internet Service Provider (ISP)
Value added services
3G
Telecommunication Equipment
Current Scenario
Indian telecom industry a shinning knight in the armour of Indian industries continued to register a significant growth in 2008-09. Indian telecom network, with subscriber base crossing 479 mn in July 2009, is the third largest in the world, while it is the second largest wireless network
At the current pace, the target of 500 million connections by 2010 is well within reach.
The wire-line segment has been declining gradually but the wireless subscriber base grew at a compound annual growth rate (CAGR) of 75.9 per cent per annum since 2003. The share of wireless phones increased from 24.3 per cent in March 2003 to 90.88 per cent in February 2009. Universal access objective feasibility has improved affordability of wireless phone. Several steps are undertaken by Government for reduction in entry barriers, creation of a level-playing field between incumbents and new entrants and forward looking regulation. Consequently, there has been an increase in share of private sector in total telephone connections to more than 79 per cent in February 2009 against a meagre 5 per cent in 1999.
The market share of top 12 telecommunication operators and their devision based on type of services provided (GSM & CDMA) are shown below:
 
Market share of top 12 operators
Market share of top GSM operators
Market share of top CDMA operators
Criteria: For Selection of Companies
In the telecom sector, we have chosen Bharti Airtel Ltd and MTNL as two companies for financial analysis and strategical suggestions.
The criteria to choose these two companies are:
MTNL is government owned and Bharti Airtel Ltd. is a private sector company, this would give a clear picture from both directions.
MTNL and Bharti Airtel Ltd. both offer similar kinds of products/services in the market. For e.g. both are in fixed and mobile communication.
They deal extensively in Value added services and also provide broadband facilities to its consumers.
Their respective asset holding is quite near to each other.
Both the companies are holding companies in other companies.
MTNL has launched 3G services and Airtel would do so from 2010.
Financial Ratio Analysis
It is a method of calculating the financial strengths and weaknesses of the firm by converting financial data into ratios. The most important financial ratios of the firm that needs to be analyzed are:
liquidity
profitability
overall performance measures
Asset utilization ratio.
The financial analysis of MTNL and Bharti Airtel Ltd. is done using key ratios not only in context of the firm’s history (over a period-trend analysis), but also with respect to each other(inter-firm).
Common size analysis is additionally done to the compare financial data across firms. Common size statements normalize the balance sheets and income statements and thus making the task at hand simple.
Overview
Financial analysis is done to assess the viability, stability and profitability of a business. These could be fulfilled by analysing the company on the following scenarios:
Short-term Investment
Long-term investment
Short-term Lending
Long-term Lending
Strategical suggestions
SHORT TERM INVESTMENT
To gain profits by investing in a company for a short term, a person has financial as well as non financial data available with him to calculate the level of risk and returns involved in the stock he is investing for short term.
To measure the volatility of the price of a stock relative to the rest of the market Beta ratio should be applied. Beta ratio provides information on the movement of the price of the stock as compared to the rest of the stock market. Beta of a stock can be used to compare a company with its peers from the same industry or sector to see the relative performance accordingly. If the beta value of a stock is more than 1, then the price of this stock is considered volatile as compared to the overall market. Thus the stock is classified as risky. If the beta value of a stock is equal to 1, then the price of the stock fluctuates at the same level as the market. If the beta value of a stock is less than 1, then the price of the stock is less volatile as compared to the overall market. Thus, the stock is classified as less risky.
Market capitalisation (cap) – Market capitalization/capitalization ( market cap or capitalized/capitalized value) is a measurement of corporate size equal to the share price times the number of shares outstanding of a public company. It is the True Measure of A Company’s Value
Another important factor that can be considered for short term investment is the P/E ratio. The P/E ratio provides relationship between the stock price and the company’s earnings.
P/E Ratio = Stock Price / EPS (Earnings per share)
The P/E ratio tells you what the market thinks of a stock. It provides information about the investors’ confidence in the stock and how much extra he is willing to pay for it.
LONG TERM INVESTMENT
The estimated returns that can be generated against the risks involved when investing for a long term, can be found out using the following criteria:-
Debt-equity ratio- Company’s financial leverage can be measured using this. Debt/equity ratio is equal to long-term debt divided by common shareholders’ equity. It is considered risky to invest in a company with a higher debt/equity ratio, especially when interest rates are rising, as the additional interest is generally paid out from debt.
Interest coverage ratio – This ratio is used to determine how easily a company can pay interest on outstanding debt. The interest coverage ratio is calculated by dividing a company’s earnings before interest and taxes (EBIT) by the company’s interest expenses of the same period. Interest coverage ratio is given as ebit/ interest expense of the company. If this ratio is low, it means the company is burdened by debt expense. If interest coverage ratio is 1.5 or lower, the companies’ ability to meet interest expenses may be questionable. An interest coverage ratio below 1 generally indicates the company is not generating sufficient revenues to satisfy the interest expenses.
Market capitalisation – Market cap helps to determine the true value of the company.
Return on capital employed (ROCE)- This ratio indicates the efficiency and profitability of a company’s capital investments and is calculated as:
ROCE= EBIT/ (total assets-current liabilities)
ROCE should always be higher than the rate at which the company borrows; otherwise any increase in borrowing will reduce shareholders’ earnings. A variation from this ratio is return on average capital employed (ROACE), which takes the average of opening and closing capital employed for the time period.
Operating profit ratio – This ratio measures the money a company is generating from its own operations; it doesn’t include income generated from investments in other businesses. Operating income can be used to judge the general health of the core business and the managerial efficiency.
Total asset turnover ratio – This ratio calculates the total sales [revenue] for every asset a company owns. The Asset Turnover ratio is given as:
Total Revenue/ Average assets for period
This ratio is an indicator of the relationship between assets and revenue. Companies with low profit margins tend to have high asset turnover and those with high profit margins have low asset turnover – it indicates pricing strategy. This ratio is useful to check the growth of companies as a fact to see the growing revenue in proportion to sales.
SHORT TERM LENDING
To lend money to a firm for a short term the following things have to be considered before going ahead with actually lending the desired amount-
Current ratio- This ratio is an indication of a company’s ability to meet short-term debt obligations; higher the ratio, more liquid the company is. Current ratio is equal to current assets divided by current liabilities
If the current assets of a company are more than twice the current liabilities, then that company is generally considered to have good short-term financial strength. If current liabilities exceed current assets, then the company may have problems meeting its short-term obligations
Quick ratio – This ratio is an indicator of a company’s short-term liquidity. The quick ratio is the measures of a company’s ability to meet its short-term obligations with its liquid assets. Higher the quick ratio better is the position of the company. The quick ratio is equal to Current assets-inventories/current liabilities. It is also known as Acid test or liquidity ratio.
Quick ratio is usually more conservative than the current ratio, and is a more well-known liquidity measure, because it does not include inventory in current assets. Inventory is excluded because some companies face difficulty in turning their inventory into cash. In case short-term obligations need to be paid off immediately, situations may arise in which the current ratio would overestimate a company’s short-term financial strength.
Credit policy of the company has to be calculated to judge the credibility of the company it basically compares the debit period with the credit period for the company i.e. the credit time a company offers to its customers and the credit period it gets from its suppliers. This also gives a general idea about the cash requirements of the company.
Another important aspect to be considered is the cash from the operating activities and comparing it with the total sales. It indicates the efficiency of the management in managing its resources and gives a glimpse of the future aspects of the company. The operating profit ratio of the company also needs to be calculated.
LONG TERM LENDING
The following things need to be kept in mind before lending money to any firm for a long term.
Turnover ratios-This ratio is a measure of number of times a company’s inventory is replaced during a given time period. Turnover ratio is calculated as cost of goods sold divided by average inventory during the time period. A high turnover ratio is a sign that the company’s production and sale of goods or services is taking place at a quick pace.
Profitability ratios-A class of financial metrics that are used to assess a business’s ability to generate earnings as compared to its expenses and other relevant costs incurred during a specific period of time. A general rule followed for most of these ratios is that having a higher value relative to a competitor’s ratio or the same ratio from a previous period is indicative that the company is doing well. Various types of profitability ratios are profit margin, return on assets and return on equity etc.
Profit margin is a measures of how much a company earns relative to its sales. A company with a higher profit margin is considered more efficient than its competitor.
Two profit margin ratios are:
operating profit margin
net profit margin.
Operating profit margin measures the earnings before interest and taxes, and is calculated as follows:
Operating Profit Margin = Earnings before Interest and Taxes/sales
Net profit margin measures earnings after taxes and is calculated as follows:
Net Profit Margin = Earnings after Taxes/ sales
Return on assets (ROA) tells how the performance of the management on all the firm’s resources is. However, this does not give an idea about how well they are performing for the stockholders. It is calculated as follows:
Return on Assets = Earnings after Taxes/ total assets
Return on equity (ROE) measures how well management is doing for the investor, because it tells how much earnings investors are getting for each rupee invested. It is calculated as follows:
Return on Equity = Earnings after Taxes/ equity
Another important ratio as a part of the analysis will be debt equity ratio which helps in measuring company’s financial leverage. If this number is too high it may signify future liquidity problems. If this ratio is too low it can signify inefficient use of the various financing alternatives available to a company.
Apart from these ratios the interest coverage ratio and the debt service coverage ratio has to be calculated and evaluated too. It is the ratio of net operating income to debt payments on a piece of investment in real estate. It is a popular benchmark used in the measurement of an income-producing company’s ability to buy a property and its ability to produce enough revenue to cover its monthly mortgage payments. Higher this ratio is, and then it is easier to borrow money for the property.
Strategical suggestions
The company should be suggested a strategy as in restructuring or diversification or expansion. The strategy is decided based on the profitability and the credit policy of the company. The strategy needs to be evaluated very closely for the best possible results of the company and a bright future. The managerial efficiency also plays an important role in determining the right strategy for the company in future endeavours. Thus, strategical suggestions should be made keeping in mind these points and only after detailed analysis of financial and non-financial data is done
Observations
Analysis Of Financial Statements
LIQUIDITY RATIOS
Liquidity ratios in a Balance Sheet refer to the company’s ability to meets its current obligations. There are two major liquidity Ratios, Current Ratio & Quick ratio.
Current ratio gives us an idea about how much of a company’s current liabilities is covered up by its current assets. A higher figure in this case shows that the companies can more than sufficiently meet its current obligations.
Quick ratio is the same as current ratio except for the fact that the current assets in this case does not include inventories because it is believed that inventories are not realized as easily as other current assets are.
Calculated using:
Current Ratio = Current Assets/ Current Liabilities
Quick Ratio = (Current Assets – Inventories)/Current Liabilities
LONG TERM SOLVENCY RATIO
Solvency Ratio refers to the use of Debt Finance in the organization. It pertains to the company’s ability to meet the internal costs & repayment schedules associated with long-term obligations. They help in assessing the risk arising from the use of debt capital. The important Solvency Ratios are the following:
Financial Leverage Ratio = Assets/Shareholders’ Equity
Debt-Equity Ratio = Long Term Liabilities/ Shareholders’ Equity
Debt-Total Funds = Long Term Liabilities/( Long Term Liabilities + Shareholders’ Equity)
Interest Coverage Ratio = EBIT/ Interest
PROFITABILITY RATIOS
Profitability reflects the final position of business operations. These ratios help us to measure the overall profitability of the company. The major Profitability Ratio are given below:
Gross Profit Margin = Gross Profit / Turnover
Net Profit Margin = Net Profit / Turnover
Earning Per Share = PAT / Number of Shares Outstanding
Cash Earning Ratio = Cash Generated by Operations / PAT
Dividend Payout Ratio = Dividend Per Share / Earning Per Share
ACTIVITY OR ASSET UTILIZATION RATIOS
Activity Ratios, also referred to as Asset Management Ratio, measures how efficiently the assets are employed by a firm. These ratios are based on the relationship between the level of activity, represented by Sales, Cost of Goods of Sold, and levels of various assets. The major Activity Ratios are the following:
Total Assets Turnover = Sales Revenue/ Total Assets
Equity Turnover = Sales Revenue / Shareholders’ Equity
Fixed Assets Turnover = Sales Revenue/ Fixed Assets
Current Assets Turnover = Sales Revenue/ Current Assets
Working Capital Turnover = Sales / Net Current Assets
Inventory Turnover Ratio = Cost of Goods Sold / Inventory
Debtor Turnover = Sales / Debtors
Average Holding Period = 365 / Inventory Turnover Ratio
Average Collection Period = 365 / Debtor Turnover Ratio
VALUATION RATIOS
Valuation ratios indicate how the equity stock of the company is assessed in the Capital Market. Since the market value of equity reflects the combined influence of risk & return, valuation ratios are the most comprehensive measures of a firm’s performance. The major Valuation Ratios are the following:
Book Value Per Share = Shareholders’ Equity / Number of Shares Outstanding
Market Value to Book Value Ratio = Market Price / Book Value Per Share
Price Earning Ratio = Current Market Price/ EPS
Market Capitalization = Market Price per share x Number of Shares
Earning per Share = PAT/Number of Shares Outstanding
OVERALL PERFORMANCE
There are basically three main ratios which are used to analyze the overall performance of any Organizations, these ratio in themselves speaks a lot about how the company has performed in the last year and what are the expectations about the company in the future. The three ratios are:
Return on Assets = PAT + Interest (1-Tax Rate)/ Total Assets
Return on Invested Capital = PAT + Interest (1-Tax Rate)/(Long Term Liabilities + Shareholders’ Equity)
Return on Equity = PAT/ Shareholders’ Equity
Conclusion
State-run Mahanagar Telephone Nigam Ltd ( MTNL) reported a 53% year-on-year decline in its net profit at Rs976 crore for the third quarter (Q3) ended December as the company continued to lose market share to more aggressive rivals such as Bharti Airtel Ltd and Reliance Communications Ltd, in the markets of Mumbai and Delhi. The firm’s total revenues for Q3 also declined to Rs1,326 crore, from around Rs1,428 crore in the year-ago quarter.
“The staff cost alone accounts for almost 35% of our revenues, putting a lot of pressure on our profitability,” A.K. Arora, executive director of MTNL, had said in an interview earlier this month.
However, staff costs during the quarter went down from Rs474 crore in the corresponding quarter last fiscal to Rs433 crore in the past quarter. The reduction in costs was brought about by a voluntary retirement scheme that was initiated in fiscal 2006 and fiscal 2007, according to an MTNL statement. During the quarter, the company’s cellular phone subscriber base also increased by 182,760 new connections, bringing MTNL’s total subscribers to 2,954,880 at end-December.
What may have contributed to the decline in revenues is other income during the quarter, “which came down to Rs137 crore, from almost Rs200 crore a year ago,” said Yogesh Kirve, equity analyst at Mumbai-based Anand Rathi Securities Ltd.
MTNL was set up in 1986 by the Union government to enhance telephone connectivity across India. The government currently holds a 56.25% stake in the company.
Shares of MTNL fell 6.62% to close Wednesday trade at Rs123.40 on the Bombay Stock Exchange.
Bibliography
www.capitaline.com
www.economictimes.com
www.bharti.com
www.mtnl.net.in
www.investopedia.com
www.indiainfoline.com
www.moneycontrol.com
www.wikipedia.org
http://www.indianomics.com/2009/07/15/top-12-wireless-operators-in-india-by-subscribers/
 

Development of the ECCE Sector in Ireland

Contents (Jump to)
Introduction
Historical development of the ECCE sector in Ireland
Provisions for ECCE
ECCE Scheme
DAI
Child benefit – welfare
Public Health Nurses – Health
Equal opportunity legislation and mention at least three items of legislation and relevant to children
Show how you maintain a quality ECCE environment that complies with relevant regulations and standards.
First aid
Behaviour management
Síolta
Conclusion
Bibliography
Introduction
This report will research and discuss the historical development of the ECCE sector in Ireland with relation to the Child Care Act 1991, equal opportunity act and more legislation that set up the grounds in developing the ecce sector. Next it will look at two ECCE provisions set up by the state such as public health nurses and child benefit. Then it will have a look at one health and welfare provision set up by the state. Then it will have a look at the equal opportunity legislation with legislation and policy that affect children in the ECCE sector. Lastly it will show how to maintain a quality ECCE environment that complies with current ECCE regulation and standers with relation to the pre-school regulations and the equal opportunity act.
Historical development of the ECCE sector in Ireland
In early Ireland most childcare was done at home by the mother or the grandparents. This is because the father in the family main role was to provide for the family and the mothers main role was a home carer. Only a limited few mothers worked outside the home. From the 1960-1990 Ireland was changing immensely with Ireland opening up to European and international ideas and technology base economy urbanizing Ireland causing families to move to cities and towns away from their extended family. More women were joining the workforce by the 1990s because the Celtic tiger, this made advocate support services to start such as Early Childhood Ireland. The Child Care Act 1991 and preschool regulations started the improvement of childcare in Ireland. The 1991 act gave the HSE the duty to promote the welfare of the child but this act was largely unregulated because an inspection system wasn’t established until 1997. The preschool regulation act improved the structure and the process of childcare in Ireland and also set up an inspection system. In 2000 the government came in with the equal Opportunities Childcare Programme for a national development plan was established to improve the quality of childcare and also increased participation. In September 2007 the updated pre-school regulations 2006 came into effect, these regulation gave the childcare practitioners very specific requirements on how their childcare service should be ran such as child to adult ratio, suitable nutritious foods, and register for the children and many more regulations. These are set to improve the quality of all ECCE sectors. The ECCE set up a scheme called the free year programme. This programme is set up to give children a pre-school year to get them ready for primary school and give them the first learning experiences and becomes the start of their social and learning development

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Provisions for ECCE
ECCE Scheme
The Early Childhood Care and Education scheme gives parents the choice to put their children into a free year of early childhood care an education if they are aged between 3 years and 3 months and 4 years and 6 month’s on the first of September in which the service starts. Exceptions can be made if a child is verified as having a special need making a later starting date acceptable. The normal pattern for the free pre-school year is three hours a day over a 38 week period, if you go over these three hours you will be charged extra. Children over the age limit due to special needs might be able to be exempt from the age limit on the ECCE scheme if parents write to the Department of Children and Youth Affairs asking for an exemption from the age limit .Children with a disability are allowed to spread their free year programme over a two year period if they would benefit from this. There is no charge for parents availing this service. The state capitation fee pays these childcare services to provide the ECCE hours. Parents might be asked to pay for extra activities but these have to be optional and there must be other appropriate activities set up for the children not taking part.
DAI
The dyslexia association of Ireland (DAI) was founded in 1972 to work with and for people that are affected by dyslexia. The DAI provides information, offers suitable support services and help in representing and raising awareness about dyslexia. Their vision is for a society that is dyslexia friendly where they are able to reach their maximum potential. Everyone with dyslexia has appropriate support and identification to achieve their maximum potential in all aspects in life. Dyslexia is a specific learning disability that affects reading and spelling skills with around 10% of Ireland affected. There are a lot of services the DAI provide such as information services through every form of communication. They have an assessment service that has a team of educational psychologists that work with children young people and adults. They also have other services like tuition for both adults and children who have been diagnosed with dyslexia. For people with dyslexia the dyslexia association website has every single bit of information that someone with dyslexia would need even putting a feature on their page so people with dyslexia who struggle reading black on white can change the background colour of the page to make is easier for them to read
Child benefit – welfare
Parents or guardians can claim child benefit for a child under the age of 16 or under 18 if that child is in a youth reach programme, full time education or has a disability. Child benefit is not eligible for children age 18 of over because in the eyes of the law they are now an adult
Child benefit for twins is paid at one and half of the monthly rate for each individual child, other multiple births is double the rate.
To apply for child benefit you need to apply within the first month of your child’s birth. The month you became guardian of the child or the month you family came to live in Ireland. To keep on child benefit after age 16 for a child with a disability you have to apply a month before the child’s 16th birthday. For children in full time education child benefit will continue until the month of June stop and resume that September when they start back at education. EU citizens living in Ireland can claim child benefit even if your child is not in the country, but if he is living in an EU country where regulations apply you should claim for family benefit that you are entitled to there. The child benefit monthly rate is €140 per child it increased by €5 in January of 2015
Public Health Nurses – Health
Public Health Nurses are usually based in a towns local health centre and they are each assigned to different places and geographical areas all over Ireland. These public health nurses are employed by the health service executive to provide the community with a range of health care services. These services are provided in a range of different places such as community centres, day care centres, schools, health centres and in people’s homes they provide basic nursing care, advice and assistance to all their patients. For terminally ill patients they can provide weekend nursing and twilight nursing. Sometimes public health nurses sometimes visit mothers and their new-born babies. They also visit primary schools in arrangements with the school health services. Public health nurses keep a register for old people and people with a disability and visit them in some areas in Ireland. For people in Ireland with communication difficulties or disorders public health nurses can provide a speech and language therapy.
Equal opportunity legislation and mention at least three items of legislation and relevant to children
The main principles behind the equal status acts are that everyone equally has the right to live and participate in society’s services without being discriminated against. The people who provide these public services cannot discriminate against the nine grounds of discrimination that are:

Race
Religion
Age
Gender
Sexuality
Disabilities
Travelling community
Marital status
The civil partnership ground

In relation to a child care setting all these grounds have to be followed, for example. A member of the travelling community has to be allowed to use all ECCE services and that child cannot be bullied or discriminated against in that service because of the family they come from where they live. A childcare worker has to treat that child the same as any other in their service
Another example is for children with a disability such as a child in a wheel chair. Public services must have the facilities to be able to cater for the child’s needs such as wheel care ramps and elevators so the child can freely move around the building
Another example is sex; a young boy cannot be discriminated against if he wants to do an activity such as ballet. Just because the majority of people who do ballet are female does not mean the young child should be discriminated against and also girls who want to do activities such as a physically sport such as rugby, this child’s decisions should be respected
Show how you maintain a quality ECCE environment that complies with relevant regulations and standards.
The preschool regulations are set to improve the standards in child care and to ensure the health, welfare and safety of pre-school children in promoting their development
First aid
In a childcare building there should always be a first aid box in the building. Should also be a person who has a qualification in first aid in the building at all times. On days outside the building with the children a first aid box should be brought along and the person with the first aid qualification should also come along with the children. This is to make sure if anything happened the child the child-minder is able to help the child. This links with the pre-school regulations 2006 regulation 6
Behaviour management
In the 2006 pre-school regulations it clearly states in regulation 9 that: “A person carrying on a pre-school service shall ensure that no corporal punishment is inflicted on a pre-school child attending the service” (Anon., 2008) Therefore in the childcare setting every child should be respected there should be no practices that are neglectful emotionally or physically harmful, intimidating, degrading or disrespectful.
Síolta
Síolta is the national quality framework for early childhood education, síolta is made to asses, define and support the improvement of the quality of practice in all ECCE sectors with children in their service ages 0-6 years. The16 standards give all childcare practitioners’ a vision to apply to all aspects of the ECCE practice; some examples of these are standards are:
Each child in the service has the right to make their own choices and decisions and all their own choices made should be respected, this is stated in the 4th standards of Síolta
Each child is allowed to take their own initiate in the activities that they do giving them the appropriately level of independence and support in the child problem solving, this is stated in the 1st standard of Síolta
These 12 standards give early childhood and care practitioners a standard of quality in which all sectors of the ECCE must apply in their services.
Conclusion
In this report it has looked at the historical development of the ECCE sector in Ireland talking about the roles of the family before the Celtic tiger, the childcare act 1991 the pre-school regulations 1996 and 2006, the equal opportunity act 2000 and the ECCE scheme 2010. The report then looks at two state provisions set up by the state, talking about the ECCE scheme set up to help people in disadvantaged and disabled children in Ireland, and the DAI (Dyslexia association of Ireland) set up to help and give people with dyslexia the information needed. Next the report looks at one health and welfare provision state up by the state that are, child benefit for welfare, set up to help parents with children in full time education or children with disabilities and public health nurses as health, set up to provide the community with range of health care services. The report then has a look at the equal opportunity legislation and mentions three items of policy and legislation that are relevant to children in the ECCE sector. Lastly, the report shows you how to maintain a quality ECCE setting with relevant regulations and standards talking about síolta and the preschool rights.
Bibliography
Anon., 2008. northtipperarychild.ie. [Online] Available at: http://www.northtipperarychildcare.ie/docs/Guideline-on-Developing-a-Behaviour-Management-Policy-for-pre-school-services.pdf [Accessed 29 5 2015].
Anon., 2015. [Online] Available at: http://www.citizensinformation.ie/en/social_welfare/social_welfare_payments/social_welfare_payments_to_families_and_children/child_benefit.html [Accessed 29 may 2015].
Anon., n.d. gillmacmillan.ie. [Online] Available at: http://www.gillmacmillan.ie/AcuCustom/Sitename/DAM/058/Early_Care_and_Education_Practice_-_Look_Inside_Sample.pdf [Accessed 29 may 2015].
Anon., n.d. siolta.ie. [Online] Available at: http://siolta.ie/ [Accessed 1 june 2015].
Anon., n.d. www.hse.ie. [Online] Available at: http://www.hse.ie/eng/services/list/1/LHO/CavanMonaghan/Public_Health_Nurse/ [Accessed 30 may 2015].
dyslexia.ie, n.d. www.dyslexia.ie. [Online] Available at: http://www.dyslexia.ie/