Marketing Strategy of Big Bazaar India

Marketing Strategy of Big Bazaar India In this assignment, I have described its marketing strategies and promotional activities. The assignment is based on the effective marketing strategy which influences customer to purchase a product of Big Bazaar helps to understand the effect of marketing strategy which is responsible for attracting customer towards big bazaar. The research was carried out as per the steps of Marketing Research. The well supportive objectives were set for the study. To meet the objectives primary research was undertaken. The data collection approach adopted was experimental research. Big Bazaar is the fastest growing and most successful Retail chain in India. Big bazaar is the first retail chain to be started in India and is the largest until now. In the later part of the assignment I have applied 4Ps marketing strategy to show that how Big Bazaar has reached from introduction stage to growth stage and observed via some points that this company is right now in growth stage of Product Life Cycle model. I have also analyzed the SWOT showing how this company made its brand more effective. I have also described some suggestions to improve its brand image towards customers. Contents INTRODUCTION: BIG BAZAAR is a name renowned in Retail. It is now a brand image in private retail sector. Wal-Mart is the retail stores of USA and is known all over the world for its fashionable and affordable materials and is known as one of the best in its field, big bazaar can be said as the Wal-Mart of India running a chain of more than 100 retail stores in India. People around the country thinks that big bazaar is inspired from Wal-Mart and it is quite obvious to think as Wal-Mart is world leading chain of retail shopping but actually the idea of big bazaar came to the CEO Kishore Biyanifrom a 25 years old store Saravana which was owned by a family and worked on the philosophy of low margin high turnover. Following its slogan of isse sasta or achha kahin nahi(Meaning cannot find cheaper and better than this anywhere) it provides the consumer with the best of the materials at a rate less than rest of the market. Big bazaar is the subsidiary of Future Group, Pantaloons Retail India ltd. The brain behind big bazaar is the CEO of Future Group Mr. Kishore Biyani Future group is has various brands like Pantaloons, F123, Copper Chimney, Etam, Staples, One Mobile, Urbana, Brand Factory, LootMart, HomeTown and Central. Big bazaar covers all parts of India including the metro cities Kolkata, Delhi, Chennai, and Mumbai. Big bazaar started with its first store in Kolkata, west Bengal in 2001 and now owns more than 100 stores all over India making itself the fastest growing retail chain in India and leaving all its competitors behind. WHY BIG BAZAAR? Indian retail sector is witnessing one of the most hectic Marketing activities of all times. The companies are fighting to win the hearts of customer. There is always a first mover advantage in an upcoming sector. This advantage goes to BIG BAZAAR in India. It has brought about many changes in the buying behavior of people as Big Bazaar provides all items in one roof at low rates. The consumers preferences are changing they are moving from shops stores to Modern Retail outlet. Its the main challenge to the Modern retail outlets to attract the customers towards them from that of competitors. To attract more customers companies have to carry out the promotional activities in unique way. BIG BAZAAR has maintained that uniqueness has succeeded in attracting customers. The promotional activity of the company, which famous as Less Price than others as it saysNobody Sells Cheaper and Better!is made its place in minds of customer. As the competition is becoming stiff in the market the activities conducted by the company are unique, that have brought fruitful result to the company. Among them sales Promotions is one of the leading activity or unique among all other activities has high influence on the customer walk-in. OBJECTIVES: To know the effective marketing strategy which influence customer to purchase a product of Big Bazaar. To know the marketing and promotional strategy of big bazaar. How Big Bazaar Establish and maintain its position in retailing through promotion. LITERATURE REVIEW: RELATED CASE STUDY: A lot of case studies have been done before on this topic and its different aspects as my focus is on leading towards success through the low cost strategy which is followed by big bazaar, one of them is described below: Building brand through challenge: In 2001, PRIL opened its first Big Bazaar, a 30,000 square feet store in Kolkata. The major USP of the Big Bazaar, store was low pricing. These stores offered the best price proposition to customers. As part of this, the stores focused less on branded items and more on unbranded products with the same quality as branded ones, at a much cheaper rate. Commenting on this, Biyani said, We are not in the business of selling ambience, but in the business of giving the best possible deals to our consumers. The first Food Bazaar was set up in Lower Parel in suburban Mumbai in 2001. Food Bazaars represent PRILs foray into yet another value retailing business, focusing on food and grocery products. These stores were designed based on PRILs understanding of the emotional and rational needs of Indian housewives The tremendous success of the Pantaloons, Big Bazaar and Food Bazaar retailing formats, easily made PRIL, the #1 retailer in India by the early 2004, in terms of turnover and retail area occupied by its outlets. In the fiscal year ended June 30, 2003, PRIL increased its retail area by 66% to 586,000 sq. ft and reported revenues of Rs 4.45 billion, a 56% increase over fiscal 2002. Its net profits rose by 63% to Rs. 114.1 million in fiscal 2002-03, over the previous year. Big Bazaar has positioned itself as a value for money proposition for Indian family retail store. They wanted to promote Big Bazaar as a retail store which gives its customers maximum advantage over other retail stores by catering to all their needs budget wise and income level wise. Sabse Saste 3 Din'(the cheapest 3 days) brain child ofMr. Sadashiv Nayak, President Big Bazaar and Rajan Malhotra, President Strategy and Convergence, Big Bazaar, believe that Consumers are always looking for best value for their money. Big Bazaars Sabse Saste 3 Din is a great opportunity for them to save money and gets best products at the best possible prices. These three days have come to truly signify freedom from high prices for consumers in the country. Maha Bachat ( save money) was introduced five years back ( in the year 2006 ) and it is still running very successfully. It is known as one of Indias mega shopping campaign. Continuing its efforts to provide the best shopping deals and savings to Indian consumers, Big Bazaar is always set to make Republic Day and Independence Days shopping, truly memorable, with rock bottom prices, best possible discounts and mega offers. Apart from the flagship Big Bazaar and Food Bazaar stores, other future group retail formats like Furniture Bazaar, Electronic Bazaar, Depot, and Home Bazaar stores are also a part of this mega campaign. From daily household needs of food and grocery to apparels, RETAIL INDUSTRY IN INDIA: India has one of the largest numbers of retail outlets in the world. Of the 12 million retail outlets present in the country, nearly 5 million sell food and related products. Thought the market has been dominated by unorganized players, the entry of domestic and international organized players is set to change the scenario. Organized retail segment has been growing at a blistering pace, exceeding all previous estimates. According to a study by Deloitte Haskins and Sells, organized retail has increased its share from 5 % of total retail sales in 2006 to 8 % in 2007. The fastest growing segments have been the wholesale cash and carry stores (150%) followed by supermarkets (100%) and hypermarkets (75-80%). Further, it estimates the organized segment to account for 25 per cent ofthe total sales by 2011. India retail industry is the largest industry in India, with an employment of around 8% and contributing to over 10% of the countrys GDP. Retail industry in India is expected to rise 25% yearly being driven by strong income growth, changing life styles, and favorable demographic patterns. It is expected that by 2016 modern retail industry in India will be worth US$ 175 -200 billion. India retail industry is one of the fastest growing industries with revenue expected in 2007 to amount US$320 billion and is increasing at a rate of 5% yearly. A further increase of 7-8% is expected in the industry of retail in India by growth in consumerism in urban areas, rising incomes, and a steep rise in rural consumption. It has further been predicted that the retailing industry in India will amount to US$21.5 billion by 2010 from the current size of US$ 7.5 billion. Shopping in India has witnessed a revolution with the change in the consumer buying behavior and the whole format of shopping also altering. Industry of retail in India which has become modern can be seen from the fact that there are multi- stored malls, huge shopping centers, and sprawling complexes which offer food, shopping, and entertainment all under the same roof. India retail industry is progressingwell and for this to continue retailers as well as the Indian government will have to make a combined effort. 4PS OF MARKETING: Marketing is the promotion of products, especially advertising branding. Marketing practice tends to be seen as a creative industry, which includes advertising, distribution and selling. Marketing mix is a deciding factor in formulating marketing techniques for the success of a particular brand, commodity or company. The components of marketing mix are: Product Price Place Promotion http://marketingroi.robinsonmaites.com/wp-content/uploads/2010/01/4ps.gif Source: http://notesdesk.com/notes/marketing/the-marketing-mix-4-ps-of-marketing/ PRODUCT: Big Bazaar offers the maximum variety for every category of product. The product is the same in every store in the city but the brand options are more in Big Bazaar and the quantity for each product is not limited to large packs only. The commodities sold by the retail chain includes its own products which get a ready distribution network. The own products of Big Bazaar include My World fashion magazine which is not available anywhere else. So costs are very low for such products. PRICE: Price is the critical point in a competitive industry. Big Bazaar works on a low cost model. It considers its discounted price as its USP. There is an average discount of 6-8% on all items in respect to their MRP. Prices of products are low because it is able to secure stock directly from the manufacturer. There are huge synergies in terms of bulk purchasing, transportation and central warehousing. These all factors are very helpful for the retailers to keep low prices. PLACE: Place means the location of the business. Big Bazaar has always worked on cheap locations. It targets semi-urban population with its placement. Its strategy is to find a low-cost location and it never goes for hot spots in the city. It relied on promotional activities to make up for unattractive locations. Another strategy used by Big Bazaar to overcome location disadvantage is use of internet. It has launched a merchandise retailing website www.futurebazaar.com which targets high-end customers ready to use credit cards. The promotion of this website is done through advertisement on Google. The website is put as sponsored link. PROMOTION: Big Bazaar has huge promotion budgets. The biggest idea behind all advertisements is to make people do bulk shopping. There are 2 types of promotional strategies of big bazaar. One is the advertisement which promotes the brand and creates awareness towards people. It is not targeted at promoting each store but only creates an image of Big Bazaar as low-cost shopping option. The store has advertised through TV, road shows and also started reality show-typed promotional campaign The Big Bazaar Challenge. Promotions like Sabse Sasta Din(Cheapest Day) are a very successful strategy to get good results. In this products across categories such as furniture, electronics, utensils, apparels and food products at the lowest possible prices, coupled with attractive promotional schemes. Some of the most attractive offers being a 20-litre branded microwave oven with grill for Rs 2,399, jeans and trousers for Rs 199 and HCL laptops for Rs 22,800. Buy 2 Get 1 Free types of promotions are very common. Original prices are cut down and new prices are shown, of which customer takes quick notice. There are loyalty schemes which reward regular clients. CURRENT POSITIONING STRATEGY OF BIG BAZAAR: Big Bazaar is holding a strong position in the market and is growing very fast. It captures the maximum Indian market and with a strong financial background and it has to go a long way through. The low price strategy it is successfully running its business all over India and is still growing bigger and bigger. The following graph shows the Product Life Cycle of Big Bazaar which is currently at the growth stage. Source: http://www.coolavenues.com/know/mktg/ravi-big-bazaar-14.php Looking at the product life cycle of big bazaar it can be seen that it is in the growth stage at this point of time and still have a lot scope to grow. It is said that: Cheap prices are a luxury for the rich but a necessity or a need for the poor. So Big bazaar has understood the need of a vast population of the upper middle class and middle class people of the country and in fact no matter how rich a person is wherever he/she can get good brands at a cheaper rates they will be attracted towards it whether an average or a rich person. RETENTION STRATEGY: Big Bazaar strive to foster a feeling of well-being in their employees through care and respect, Big Bazaar have several structured processes including employee mentoring and grievance management programmers which are intended to facilitate a friendly and cohesive organization culture. Off -site activities are encouraged to improve interpersonal relationship. Big Bazaar also acknowledge the efforts exerted by their employees by organization an annual celebration called Pantaloon Day where Big Bazaar recognize employees who have shown exceptional talent, sincerity and dedication. Big Bazaar have implemented an employee suggestion programme called Prerna wherein the employee can give their suggestions. Every quarter the best suggestion received per zone per format is awarded prize called Golden Cap. BIG BAZAARS NEW MARKETING STRATEGY: Big Bazaar has launched new marketing strategy which is based on Guerrilla Marketing. Guerrilla marketing warfare strategies are a type of marketing warfare strategy designed to wear-down the enemy by a long series of minor attacks, using principles of surprise and hit-and-run tactics. Attack, retreat, hide, then do it again and again, until the competitor moves on to other markets. Guerrilla force is divided into small groups that selectively attack the target at its weak points. In the world of cut throat competition, corporate use extension of the same strategy in marketing. Corporate like Pepsi, Coke etc have been using the same for quite some time now and the latest entrant is our very own Future Group- Big Bazaar, Future Bazaar, Pantaloons, e Zone are all part of this group and they are taking on the biggies like Shoppers Stop, Lifestyle, and Tatas Westside. In order to do the same, Future Group have come up with 3 catchy and cheeky ad campaigns which surely do catch our eyes a nd surely one cant resist appreciating the same. ADVERTISING: THE ESSENTIAL OF BRAND BUILDING PROCESS- Advertising is an essential component of brand building. The advertisement and brand building is done through various ways, the techniques used are: Tag-line:Big Bazaar tag-lines are the key components of advertising. These tag-lines are modified according to demographic profile of customers. These catch-phrases appeared on hoardings and newspapers in every city where Big Bazaar was launched. Print Ads:Big Bazaar newspaper advertisements are present just before launch of any new scheme. TV Ads:Kishore Biyani spends a lot of money in brand building exercise. Big Bazaar commercials are shown on various channels in India. Presently, Fashion at Big Bazaar commercial is aired. Road-side Advertisements:Big Bazaar bill-boards are displayed on prime locations in various cities as a brand building exercise. They display the catch-phrases now-a-days. Radio Ads:This technique is used in cities like Sangli (Tier 1 / Tier 2 cities).Now-a-days, it is replaced by advertisements on FM channels. This informs customers about all new happenings at Big Bazaar. For example: The departmental store chain Big Bazaar has launched a commercial sometime back to promote The Great Exchange Offer. The commercial portrays how customers can exchange any old and broken items (junk) and get new products at a discounted price from Big Bazaar. Customer can get the amazing prices for junk. The month of January and February is generally a low-key affair in terms of customer footfalls and revenue generation. Innovative, out of the box promotions is one of the effective ways to draw customer attention and shore up the revenue. Historically Exchange schemes have been used to induce better sales; it also has a strong appeal with the Indian mindset of getting value even for their junk, states an official release from Big Bazaar. SWOT ANALYSIS: Strengths: Maximum number of varieties: People prefer those places where they can get the maximum products they need and Big Bazaar provides vast range of products under one roof helping in attracting customer and their family to shop together and enjoy the experience. High brand equity: Big Bazaar has created high brand equity through its promotions and marketing it has created a different image for its products as the cheap and best. Largest chain of retail marketing in India: Big Bazaar is the first retail chain to be started in India and is the largest and successful until now. High capacity investment: Big Bazaar offers 1,70,000 products and owns more than 100 retail stores all over India and has the strong financial background as being the subsidiary of future groups which owns the pantaloons which is one of the biggest the industries in mens wear in India and have its work is spread all over India. Future group is one of the leading groups in India. Everyday new promotions and schemes of low prices and discounts: Big Bazaar always offers new schemes of low prices and gives discounts in products like Big Bazaar offers the sabse saste 3 din ( the cheapest 3 days) in which it offers the lowest of prices than other days. Facilities like online booking and delivery of goods: It is not just a chain of retail shopping but also provides online shopping facility to the consumers. Weaknesses: Overcrowded: During offers, promotions and even on weekends the place is overcrowded with people and sometime even there is the situation of closing the store due to it. Checkout can be extremely slow: There can be seen a long queue on the billing counters making the consumer wait for hours due to the slow service and the crowd. Perception of low price=low quality: Generally people think that if any product has low price then the quality of the product will be low as they think quality comes with price. Targets at the middle class and upper middle class only: It targets at the middle and upper middle class due to which it ignores the upper and elite class people as they are the cream of the society who are ready to pay any price for the quality and product they need. Opportunities: Big Bazaar can enter into production of various products due to its in depth understanding of customers tastes andpreferences. Nowadays people prefer going to one big store and buy everything instead of visiting different places for different items and waste time. So Big Bazaar can expand the business in smaller cities as there is a lot of opportunity. Lot of potential inthe rural market. Threats: High business risk involved: Big Bazaar investment is very large so it is obvious that there is high business risk involved. Lot of competitors: There are a lot of countries which are planning to enter the Indian market like Wal-Mart, Carrefour and Tesco which is a big threat to Big Bazaar. Less Parking Space: Customers are not satisfied with the parking space availability provided by Big Bazaar. Hence its a threat of Big Bazaar as it may loose its customers because of less parking space availability. In holidays it will be very difficult for customers to park their vehicle in Big Bazaar. Unorganized retailing: Unorganized retail stores are a threat to the business of big bazaar as now also people prefer to go to the local stores which are convenient enough for them. COMPARITIVE ANALYSIS: BIG BAZAAR V/S VISHAL MEGA MART Vishal Mega Mart ( FOR DETAILS REFER APPENDIX) Fields Big bazaar Vishal mega mart Price Big Bazaar prices are very low because its adopt the low price marketing strategy. Vishal Mega Mart prices are not low because they give whatever is market price. Service Big Bazaar services are not quite good as billing problem due to crowd and less parking space. Vishal Mega Mart does not face these kind of problems as its not overcrowded. Ambience Product variety Big Bazaar has lots of variety in every category of products. In Big Bazaar people can find almost everything. Vishal Mega Mart dont have so much varieties as it is smaller than Big Bazaar. Convenience Big Bazaar has always worked in cheap location so that it is very convenient for the people to go to the Big Bazaar rather than going outer of the city. Vishal Mega Mart also works in low cost loacation but it is not so much popular in comparison of Big Bazaar as showrooms of Vishal Mega Mart are less than Big Bazaar. Shopping experience In Big Bazaar people can buy the maximum variety of products of every category under one roof helping in attracting customer and their family to shop together and enjoy the shopping experience. Vishal Mega Mart also provides the products under one roof but there is not so much varieties so that customers dont attract so they can not enjoy their shoppings Product quality The product quality is good in Big Bazaar because people can find cheap and best things in Big Bazaar. The product quality is also good in Vishal Mega Mart but the prices are very high. RECOMMENDATIONS: Big bazaar should keep offers in regular intervals so that there should not be a long term gap, because offer is the most influencing factor which is responsible for customer purchase decision. Big bazaar should start emphasizing more on internet shopping along with the formal retail shopping because a large population of the country likes to shop online in order to save time. Along with the different discounts and offers it should pay attention towards the students and provide some offers for them also because half of the Indian population is of youths and students. It should work on its billing counters and customer service in order to solve the problem of long queues and waiting customers. CONCLUSION: Big Bazaar is undoubtedly the number one retailer in India. It has built a very emotional and cordial relationship with its customers. It is also very intending to built long-term relationship with all its stakeholders, which is very essential for a successful business venture. It is observed that the organization hierarchy is professional as all the departmental Managers directly report to the store manager who in turn reports to the Zonal Head. Big Bazaar, with 25 years of experience in the field of weaving fabrics, is the leading Apparels and fashion design fabric company. There exist a healthy and positive relationship between employees and managers. The employees accept their responsibilities wholeheartedly, accept that it is their responsibilities to carry out a part of the activities of the company and they will be held accountable for the quality of their work. It is found that more than 60% of employees are of the age group of 20-35. Fromthis it reveals thatcompany is having young and energetic workforce who are very creative, enthusiastic and also very determined to grow in their career and in turn helping the company to grow. Working environmentis good and also the various facilities provided helps in motivating the employees. The company is reaching out to all the sections of the society as it is creating a hypermarket where not only the rich people shop but also the middle and the lower class customers come to enjoy the whole shopping experience. Moreover the customer friendly ambiance and the organized retailing of products also make Big Bazaar one of the successful retail industries in India. REFRENCES: Abhay, 2008. Big Bazaar. [Online] Available at: http://ekikrat.in/Big-Bazaar [Accessed 23 March 2011]. Admin, 2009. Marketing Mix. [Online] Available at: http://notesdesk.com/notes/marketing/the-marketing-mix-4-ps-of-marketing/ [Accessed 18 March 2011]. Berry, T., 2008. How to Perform SWOT Analysis. PaloAltoSoftware,Inc. Bhasin, R., n.d. Big Bazaar Case Analysis. [Online] Available at: http://www.slideshare.net/pushpa14/big-bazaar-case-analysis [Accessed 29 March 2011]. Bhatia, H., 2010. Big Bazaar. [Online] Available at: http://business.mapsofindia.com/india-retail-industry/companies-growth/big-bazar.html [Accessed 21 March 2011]. Cook, S., 2011. Big Bazaar India. [Online] Available at: http://goindia.about.com/od/shopping/gr/big-bazaar.htm [Accessed 20 March 2011]. FutureBazaar.com, 2010. Future Bazaar India Ltd. [Online] Available at: http://bigbazaar.futurebazaar.com [Accessed 24 March 2011]. Group, F., 2008. Future Group. [Online] Available at: http://www.futuregroup.in/home.asp [Accessed 22 March 2011]. Gupta, N., 2010. Big Bazaar Maha Bachat. [Online] Available at: http://www.indiasummary.com/2010/08/11/big-bazaar-5-days-maha-bachat-sale-from-big-bazaar-india-august-2010-for-independence-day/ [Accessed 25 March 2011]. Kotler, P., n.d. In Marketing Management. 12th ed. Kumar, V., 2010. Promotional Strategy of Big Bazaar Maintaining the image in Retailing. [Online] Available at: http://www.skylinecollege.com/blog/dissertation/promotional-strategy-of-big-bazaar-maintaining-the-image-in-retailing [Accessed 19 March 2011]. Malhotra, R., 2008. Big Bazaar Indias Real Retail Story. [Online] Available at: http://www.moneycontrol.com/news/business/big-bazaar-%E2%80%93-india%E2%80%99s-real-retail-story_358768.html [Accessed 26 March 2011]. Mital, D., 2010. Big Bazaar: a Review. [Online] Available at: http://www.chillibreeze.com/articles/Big-Bazaar.asp [Accessed 27 March 2011]. Rakesh, 2011. Big Bazaar. [Online] Available at: http://www.pantaloonretail.in/fashion-bigbazaar.asp [Accessed 20 March 2011]. Raman, A. Winig, L., 2006. Big Bazaar. Harvard Business Review, p.23. Rao, V.S.R., 2010. Big Bazaar. [Online] Available at: http://www.citeman.com/11184-big-bazaar/ [Accessed 28 March 2011]. Sankar, M., 2009. Big Bazaar The hypermarket. 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Analyse the key features of Virtue Ethics Essay

Virtue ethics is a custom which goes back to Plato and Aristotle; it is also known as aretaic ethics, from the Greek word arà ªte meaning excellence or virtue. There are a number of key features to virtue ethics, one of the most significant being that it is an agent-centered theory rather than act-centered theory. Therefore it asks the questions ‘What sort of person ought I to be?’ rather than ‘How ought I to act’. The concept does not focus on actions being right or wrong, but on how to be a good/virtuous person. Virtue ethics was re-examined and redeveloped in the twentieth century by philosophers such as G.E.M. Anscombe. Plato proposed that virtue ethics centers around the achievement of man’s highest good, which involves the right cultivation of his soul and the harmonious well-being of his life, otherwise known as eudaimonia. Additionally, Cardinal virtues are a vital feature to the proposal of virtue ethics, examples are: temperance, courage, prudence and justice. These Plato seemed to consider central virtues and that, when these virtues are in balance, a person’s actions will be good. However, there was not much agreement among the Greek philosophers about which virtues were central, and Aristotle gives a very different account of the virtues. Aristotle highlighted a significant feature to the theory as he sought to give an account of the structure of morality and explained, in his book Nicomachean Ethics, that the point of engaging in ethics is to become ‘good’. Here, Aristotle differentiates between things which are good as means and things which are good as ends. Additionally, Anscombe argues that eudaimonia is the highest good because we desire it for its own sake, and not just as a means to anything else at all. Other good things, such a justice, are desired because they lead to a good life, whereas good living itself is not wanted for anything which it might lead to; it is inherently worth having. Aristotle, highlighting another feature of the ethic, suggests that human well-being and human flourishing is a life characterized by the virtues. However, this good human life is one  lived in harmony and co-operation with other people, since Aristotle saw people as not only rational beings but also as social beings. We live in groups and he saw the well-being of the group as more important than that of a single member. Moreover, Aristotle believed that the best way to achieve eudaimonia was to develop and exercise qualities that are most productive for living in a society. Extremes of behavior, such as being too timid at one extreme or too assertive at the other, are unhelpful to society. This led Aristotle to create a crucial feature of virtue ethics, what he called the Golden Mean, which can be explained as: striking the right balance between extremes. Each extreme he called a ‘vice’, and the midway point where the right balance is struck he called a ‘virtue’. However, the mean is not the same of everything and depends on circumstance – you need to apply phronesis to decide on the right course of action on each situation. Aristotle was convinced that virtue is something which we acquire and not something which we have when we are born; different people are not inherently good or bad, but become good or bad according to the habits they develop in themselves. Therefore, Aristotle highlighted a key feature in the ethic that it is not enough to have the know-how or even the habit of behaving as the virtuous person does, the actions are not as important as the character, and therefore the virtuous behavior must be done with the right motivation, as the virtuous person would do them. In the twentieth century there was a revival of interest in virtue ethics by philosophers who were unhappy with act-centered ethical theories. Stressing key features to the theory, modern versions of virtue ethics argue that the assessment of a person’s character is an important aspect to our ethical thought and needs to be included in any ethical theory. In 1958 G.E.M. Anscombe published a paper called ‘Modern Moral Philosophy’ where she argued that the concept of moral rules and of moral obligations is flawed. She attacked the traditions of Utilitarianism and of Kant, which both set out principles for people to follow and which look at the morality of different actions, rather than at the character of the person. Anscombe argued that the idea that we have obligations to keep rules makes no sense unless people believe in God. Without any absolute law-giver, there is no sense in following laws in ethics. She saw that ethical systems which try to establish rules even after the idea of God has been abandoned are incoherent, not recognizing that their basis depends on belief which many people no longer hold. For Anscombe, the way forward is to revive the concept of human ‘flourishing’, eudaimonia, which does not depend on any notion of God. Philippa Foot attempted to modernise Aristotle’s virtue ethics while still keeping the Aristotelian understanding of character and virtue. She recognises the significant features to the ethic, such as the importance of the person’s own reasoning in the practice of virtue, claims that the virtues benefit the individual by leading to flourishing and stresses that the virtuous person does far more than conform to the conventions of society. Foot argues that a virtue does not operate as a virtue when turned to a bad end. Virtues are good for us and also help us to correct harmful human passions and temptations. Additionally, in his book After Virtue, Alasdair Macintyre claims that ethical theories have simple resulted in ethical disagreements. The result if this, he suggests, is that people do not think there are any moral truths and consider one opinion to be as good as any other opinion. Macintyre argues that most people’s attitudes today are based on emotivism. Macintyre added a vital feature to the ethic, as he wanted to restore the idea that morality should be seen in terms of human purpose, but he thought it would not be possible to restore Aristotle’s theory of function and so he attempted to make human function, and so human virtue, depend on community. According to virtue ethics, morality is not found in actions or in duties, but in the person performing the actions, the ‘agent’. Thus morality should focus on the person, and not necessarily on the choices they make in their moral behavior. The theory concentrates on being, rather than doing, and this crucial feature results in the contrasts with other forms of ethics,  which aim to show how to discover the right course of action. Although the system is based on ideals, it is no unrealistic, because it looks to actual examples of virtuous people, such as Martin Luther King or Jesus; it can therefore be seen to have attainable targets. It’s aim is to achieve something which people genuinely want, eudaimonia, rather than being based on arguably incoherent ideas about the after-life. Evaluate the extent to which virtue ethics can withstand criticism. Virtue ethics encompasses all aspects of life rather than particular actions. It sees every moment as the possibility for acquiring or developing virtue. Virtue ethics provides an alternative route for drawing on the tradition of moral philosophy in a way that’s a different from the natural law approach. It’s an alternative ethical model that fits Christian ethics and also reaches beyond religious ethics. However, some Christians may argue that, in modern society, the extent of the relevance of the ethic can be considered insignificant as it focuses on the fundamental issues of what it means to be human, rather than looking for rules. Therefore, virtue ethics does not pretend to be able to tell us what a good person would do in every situation but encourages us to be more like such a person so that we will not need an ethical theory to make our decisions for us. This asset strengthens the theory, possibly increasing the extent to which it can withstand criticism as it stresses the importance of character, providing the example: someone who helps the poor out of compassion does seem to be morally superior to someone who does it out of duty. Multiple criticisms have been voiced about the theory and many have reduced the degree to which the concept is valued in modern day society. For example, one criticism leveled against virtue theory is that it is far from replacing the arguments about moral duty and moral absolutes, it ultimately depends on them. Walter Schaller, in his works, argues that moral virtues have only ‘instrumental or derivative value’. Virtue ethics relies on the concept of duty and the idea that there are moral norms or absolutes. This point undermines the significance of virtue theory, as Macintyre was trying to get away from the arguments about duty and moral actions. On the other hand, Robert Louden criticises the theory by questioning how virtue ethics can be applied to moral dilemmas. He argued that virtue ethics does not help people facing a crisis because it does not give any clear rules for action, for example what is the virtuous response to abortion? Virtue ethics does not provide any concrete answers and only says it is a matter for the practical wisdom of the person facing the situation. However, some Christians may argue that this statement can be counteracted as a strength of the theory as a lack of concrete answers allows personal choice and freedom to decide what is morally virtuous, increasing it’s ability to withstand criticism. Louden also points out that it is difficult to decide who is virtuous, as acts which appear virtuous on the outside may not necessarily have good motives and vice versa. Nevertheless, virtue ethics counteracts this criticism as it, as a theory, enables us to integrate many aspects of life, such as our social responsibilities, into our ethical reflection; it looks at what makes life valuable rather than looking at what is right or wrong. It does not reject our emotions but includes them, and so is more in-tune with how people naturally react to an ethical dilemma. It relates our ethical choices to the bigger picture. Additionally, it has been argued that virtue ethics does not seem to have room for basic concepts such as rights and obligations. This therefore reduces the theory’s ability to withstand the criticisms proposed of it and thus reducing how relevant the theory is. As a theory of ethics is seems incapable of dealing with big issues – virtue ethics does not always have a view about what makes an act right or wrong. It is vague, therefore it is hard to make decisions. Moreover, the theory counteracts the criticisms aimed at it through the use of examples of virtuous people. Virtue ethics stresses the importance of motivating people to want to be good. Shows how we acquire and learn virtues by intimidating others. Examples of these virtuous people are Martin Luther  King and Jesus who both fought for supreme happiness for society. Conversely, criticisms have been constantly weakening the theory through questions such as ‘What is happiness?’ and ‘Does Aristotle’s supreme happiness exist?’. It has been argued that virtue ethics depends on some final end which gives shape to our lives – there may not be one and being virtuous may not effect it anyway. These factors significantly weaken the extent to which the theory has survived criticism especially as the ethic seems to praise some virtues that Christians might see as immoral, such as soldiers fighting unjust wars may be courageous but that doesn’t make them morally good. However, the theory has also been vitally strengthened for modern society through its acceptability of bias behavior in favor of friends and family, unlike utilitarianism or Kant, which see impartiality as important. The relevance of the concept is also supported through it’s avoidance of following a formula, such as utilitarianism: ‘the greatest good for the greatest number’, to work out what we ought to do and focuses instead on the kind of person we ought to be. Therefore it is a more practical way of making a decision easily. Overall, even though the criticisms of the theory are vital in reducing the extent to which it is valued in this present day, the strengths of the theory provide society with an ethical guideline as to how to be and what makes a virtuous person.

Big Mountain High School Case Study Analysis Education Essay

In this instance survey analysis, I will give a brief sum-up of the instance and the jobs I found along with particulars. I will besides supply recommendations for the territory and school leading that will turn to the awaited barriers to alter. I will establish my recommendations on the needed readings for this class every bit good as other theoreticians and their research applicable to the instance survey. Big Mountain High School serves over 1450 pupils in grades 10-12. Large Mountain is the lone high school in the county, and besides the largest high school in the province. Its geographical location is known for its wilderness and beauty. Because of its location it is mostly a rural territory where many of the attending pupils commute more than 30 stat mis every twenty-four hours to have day-to-day direction. The population of the school ranges from diverse socio-economic backgrounds. As evidenced in the instance, 40 % of the pupils will travel on to go toing 4-year colleges, while 20 % of the pupils attend 2-year colleges. For pupils that are non college edge, as an excess educational option, the territory provides them with a vocational plan ( Smith & A ; Louis, Winter 1999 ) . The Superintendent of the territory is Mr. Bob Carpenter a indigen of the territory. He has been the overseer for four old ages and he is described as being magnetic, a individual who makes determinations and gets things done. He is extremely respected amongst the instructors and staff because he meets straight with the instructors and listens to what they have to state. Mr. Carpenter is besides described as utilizing a bottom-up leading manner doctrine. The chief Mr. Vogel has held the place for 15 old ages. He is known as being a dedicated manager, candid and carnival to his staff. Mr. Vogel besides adopted a bottom-up leading manner doctrine. Some nevertheless, see him to be â€Å" crusty and impersonal † and even unapproachable. He makes hiring determinations, nominates the section chairs, normally communicates with instructors in short staff meetings, and maintains that disposal has full authorization over the processs and policies in the school. The sections at Big Mountain high school were given entire authorization and liberty as how they distribute the instruction assignments, how course of study and direction is designed and they besides make the determinations on budget allotments. Meetings between the principal and section caputs are non regular events, they normally meet one time every three hebdomads and the meetings are normally really short. Finally, there are the instructors. The territory ranks the highest paid among other territories in the province, supplying the territory with a big pool of extremely qualified appliers. Teachers at Big Mountain command how they teach, have small or no treatments over learning methods, the type of direction, and have small or no input in the determination doing procedure that takes topographic point in the school. Faculty is divided and with really small interdisciplinary engagement. There are several leading issues present in the instance. The major issues revolve around the ability of the leading to expeditiously take the school during a much needed alteration. In the instance of the mandated course of study alteration as required by the province, the treatments of the new course of study raised personal and pedagogical differences amongst the module. If the end of the leading is to further growing and alter the way in which the school is traveling, it would be wise for the leading to take a human resource frame attack as discussed in Bolman & A ; Deal, where under the human resource frame, leaders provide and foster equal engagement in the determination devising ( Bolman & A ; Deal, 2008 ) . At Big Mountain, the caputs of section have a significant sum of influence and authorization, and are perceived by the module as decision makers and determination shapers. These differences in power have led to a deficiency of interdisciplinary engagement between section caputs and module members where Hargreaves & A ; Fink refer to as, traditional power blocks ( Hargreaves & A ; Fink, April 2004 ) . This deficiency of interdisciplinary engagement and the misinterpretation of a collaborative leading, as become a top-down hierarchy leading, instead than a sensed bottom-up leading as expressed by the chief Mr. Vogel. It is obvious that the principal in this school will non be developing meaningful relationships with the staff. His neglect for the sentiments of the instructors during his short module meetings, along with his important leading manner resemble what Fullan ( 2001 ) describes as coercive and bossy leading. As the freshly appointed caput for the Language Arts Department, Mr. Chester non merely appointed to the commission merely those who agree with him, he besides restricted the engagement from the instructors that will be implementing the course of study. By making so, he derailed Bolman & A ; Deal ‘s model attack, and the construct of the structural frame where the attempts of groups and persons are coordinated, and besides the human resource frame, where affecting others gives them a sense of belonging and ownership ( Bolman & A ; Deal, 2008 ) . Even though ab initio the principal shared the determination devising with the commission, he rapidly reversed that determination and decided to do the determinations himself. However, subsequently he decided to name Chester to take the new alterations commission to implement the new course of study. One once more his rushed determination was made without the engagement and the input from the instructors, go forthing it small room to win and showing the deficiency of communicating and alliance edifice, necessary when turn toing alteration ( Kanter, Summer 1999 ) . As the overseer, Bob Carpenter was non of much aid to the principal in set uping and developing a successful civilization of committed members within the organisation. Although important and magnetic, his strong interaction accomplishments, the ability to construct relationships while run intoing with instructors and listening to their concerns when the principal was non supportive, have earned him the regard of the instructors, minimising the authorization of the principal. As the overseer, Bob failed as a function theoretical account, and a wise man to the principal. He came across as holding his ain political docket, showing the deficiency of his leading qualities. Qualities required when constructing a successful organisation. Recommendations for ImprovementInspiring leaders have the ability to turn schools about. On the other manus mediocre leaders can alter the civilization of a school and hinder the patterned advance of successful enterprises that may be ongoing within an organisation driven by its members. â€Å" A civilization of alteration consists of great celerity and nonlinearity, on one manus and every bit great potency for originative discoveries on the other. The paradox is that transmutation would non be possible without attach toing muss † ( Fullan, 2001, p. 31 ) . It is obvious that muss is in the hereafter of Big Mountain. Changes are inevitable, and a complete restructuring of the school is recommended. From the overseer, to principal, to section leaders, and to instructors, all fail to develop a collaborative and cohesive work environment. In the instance, the prostration was initiated from the top-down where is lacked sustainable leading. Hargreaves ( 2009 ) describes five obstructions that impede effectual leading and should be addressed in the restructuring procedure of Big Mountain. The obstructions impede the successful execution of the restructuring when sequence is ill planned, sequence passages are severely managed, sequence is frequently on the incorrect frequence, sequence planning fails to see the emotional facets, and in conclusion sequence is non treated as a systemic job. Sequence in leading is an of import facet when reconstituting an organisation and it is frequently overlooked, weakening the long term alterations for a successful turn-around. Large Mountain could profit of an increased stableness in leading. It was evident that neither the overseer nor the principal were wholly dedicated to the school and its vision. The overseer and the principal could hold been more proactive in edifice and set uping a common vision for the school. Constructing a systemic leading is another of import facet that should be taken into consideration. The overseer should work on developing unfastened lines of communicating with other successful schools in the territory, and develop partnerships with the other schools where information is shared, and thoughts are exchanged leting schools to assist each other and ultimately addition accomplishment. Another recommendation involves the development of a distributed leading and the creative activity of managers for the new leading. Bolman & A ; Deal ( 2008 ) depict the human resource frame, where the overseer and the principal would put more accent on constructing personal relationships, and the s chool would profit from the constitution of an unfastened and true bottom-up leading manner doctrine. Because more and more disposal is comprised of first-time leaders, giving support to new leaders will relieve the emotional emphasis associated with the place. Supplying good back uping managers will assist the new leaders with the troubles that come with the new administrative function. A concluding option is to maintain the position quo of the school. However, without alterations in leading, the instability that exists amongst the staff will stay and will go on to decline. Leadership stableness can be improved by leading sequence, and this may be accomplished by administering successful leaders across schools in the territory and developing a support web that will help overseers, principals and instructors throughout the territory. â€Å" Successful sequence is about turning and linking leading throughout a system, non merely happening the right tantrum for single leaders. † And â€Å" Permanent betterment seldom exists without leading stableness or successful sequence. Effective sequence is a strategic challenge but non an unsurmountable 1 † ( Hargreaves & A ; Fink, April 2004 ) . MentionsBolman, L. G. , & A ; Deal, T. E. ( 2008 ) .Reframing organisations. San Francisco: Jossey-Bass. Fullan, M. ( 2001 ) .Leading in a civilization of alteration. San Francisco: Jossey-Bass. Hargreaves, A. ( 2009 ) . Leadership Succession and Sustainable Improvement.School Administrator, 66 ( 11 ) , 10-15. Retrieved from ERIC database. Hargreaves, A. , & A ; Fink, D. ( April 2004 ) . The Seven Principles of Sustainable Leadership.Educational Leadership, 61 ( 7 ) , 8-13. Kanter, M. ( Summer 1999 ) . The Enduring Skill of Change Leaders.Leader to Leader Journal( 13 ) , 15-22. Smith, B. , & A ; Louis, L. ( Winter 1999 ) . Case 2: Changes at Big Mountain High School [ Abstract ] .Journal of Cases in Educational LeadershiP, 2 ( 1 ) , 1-2.

Accounting Rate Of Return Arr Finance Essay - Free Essay Example

Sample details Pages: 6 Words: 1806 Downloads: 9 Date added: 2017/06/26 Category Finance Essay Type Research paper Did you like this example? The aim of this Capital Investment Appraisal Report is to evaluate two transport infrastructure projects for the city of Coventry using four different appraisal techniques and make a recommendation based on the calculations as to which project would be most profitable. The budget is pound;30 million and the projects are mutually exclusive, which means only one can be undertaken. Project 1 is a new tram network and would link major parts of the city. Project 2 is a new toll road that would link the M69 and M6 motorways. Accounting Rate of Return (ARR) ARR is a non-discounted cash flow method and the only appraisal technique that is profit based. It is calculated by dividing the average annual profit by the initial investment and multiplied by 100 to give a percentage figure. ARR is easy to calculate as it is based on accounting principles. it reflects the value of the project over its entire life and is preferred by most managers as they can compare the returns from different projects and select the one which offers the highest return. ARR is usually used internally when it comes to project selection. It is rarely used by investors as cash flows are more important and ARR does not take into account non-cash items. The profit is subjective and does not equate to cash and it uses arbitrary depreciation methods. It does not take into account the time value of money, which means the value of cash flows does not diminish with time. The ARR for project 1 is 11.98% and for project 2 is 13.17%. If we were to choose between t hese two projects purely based on the ARR then we would select Project 2 as it offers a higher rate of return. Don’t waste time! Our writers will create an original "Accounting Rate Of Return Arr Finance Essay" essay for you Create order Payback Period (PBP) PBP calculates the time taken for the net cash inflows to equal the initial investment. The shorter the payback period, the more attractive the project. Payback Period is very simple to compute and it provides some information on the risk of the investment and a crude measure of liquidity. It does not however take into account the time value of money, this can be corrected however by using the discounted payback period. Cash flows after the cut-off period are ignored, the cut-off period itself is arbitrary and it ignores the risk of future cash flows. This means you could hypothetically get a huge cash flow injection after the cut off period which would be ignored. There is also no concrete decision criteria to indicate whether an investment increases the firms value. (https://educ.jmu.edu/~drakepp/principles/module6/advdistable.pdf) PBP for Project 1 is 6 years and 5 months and for Project 2 its 5 years and 9 months, this means we recoup our investment quicker with the latter investment despite it costing more and taking longer to build. this would imply that it would generate a higher revenue based on the forecasts. Comparing the payback period for both projects, we would recommend investing in project 2 as the payback period is shorter. Net Present Value (NPV) This is the sum of all the present values of all the relevant cash flows connected to the project. If the NPV is positive then we accept the project and if we have several projects that are mutually exclusive then we accept the project with the highest NPV. We reject any projects that have a negative NPV. (https://educ.jmu.edu/~drakepp/principles/module6/advdistable.pdf) NPV tells us whether the investment will increase the firms value. It considers all the cash flows, includes the time value of money and considers the risk of future cash flows through the cost of capital. One of the few weaknesses of this technique is that it requires an estimate of the cost of capital in order to calculate the net present value and the answer is expressed in terms of currency and not as a percentage. The NPV for both projects is positive but Project 2 has a much higher NPV, difference of pound;4,495,921, more than double that of Project 1, thus we would recommend investing in Project 2 based on this method. Internal Rate of Return (IRR) IRR is the discount factor at which NPV is equal to zero. The strengths of this appraisal method is that it tells us the firms value will be increased by the investment. It considers all the cash flows of the project, takes into account the time value of money and considers the risk to future cash flow through the cost of capital. Some of the flaws of this technique are that the cost of capital has to be estimated through trail and error in order to make a decision. It may not give the profit-maximising decision when used to compare mutually exclusive projects or help choose projects when capital rationing is involved. Finally it cannot be used for projects with unconventional cash flows. (https://educ.jmu.edu/~drakepp/principles/module6/advdistable.pdf) Through the trial and error method and using a difference of one percent for greater accuracy, where NPV switches from positive to negative, using the total present value rounded to the nearest pound and using a discount fact or to three decimal places, I interpolated the IRR for both projects. IRR for Project 1 is 13.28% and for project 2 it was 15.31%. Again the latter offers the higher rate of return, so the advice would be to invest in Project 2 based on this method. Non Financial Factors When assessing the feasibility of a project, non-financial factors are just as important as the economic benefit of a project and have to be considered in making any meaningful investment decision. It is important to analyse whether or not the customer will be satisfied before making an investment, as that will affect the return generated. Government policy is another important non financial factor when making investment decisions, as the rate of interest or tax could affect loan repayments, price of materials and labour. Comparing what your competitors are doing in the market could lead to investing in projects that are based on non financial factors. Analysing any trends before making an investment to see if there is a potential return from the investment. The City Council would need to consider if there is enough skilled labour force to operate the equipment that is to be invested in. The effect an investment will have on staff motivation is also a key factor b efore going ahead with any project. (https://www.accountantnextdoor.com/investment-appraisal-8-non-financial-factors-that-every-accountants-and-managers-should-consider/) Customers attracted by the product might see another product that they may like, this is known as backend profit and could be another non financial factor to consider before making an investment. Environmental issues have recently become very important to companies as they do not wish to be seen as irresponsible by the public, who could be potential customers. Companies will often invest in equipment that are seen as preserving the environment to project a positive image even though it may not be financially in their interest. The government is strongly committed to avoiding tolls on any existing roads. Campaign for Better Transport has stated the problem experienced by a number of road and toll projects, including the Mersey Gateway bridge and the loss-making M6 motorway. There is strong evidence to su ggest that forecasts for traffic on existing roads, and toll roads in particular, are over-optimistic worldwide and in the UK, as the M6 toll experience shows. A 2011 analysis of 100 completed road toll projects around the world found that road traffic forecasts have been over-optimistic by 20-25%. In the UK there has been driver opposition to pay-as-you-drive. The UK has a very highly developed existing network with large numbers of alternative routes available to drivers who wish to avoid tolls. Campaign for Better Transport review of the M6 Toll showed a drop in traffic level and revenue on the toll roads. (The M6 Toll, five years on. Campaign for Better Transport, August 2010) In other countries, toll roads have also experienced problems with over-optimistic traffic forecasts. In Brisbane, Australia, operator River City Motorway went into receivership in 2011 after predicted traffic flows on the tolled Clem7 Tunnel fell to less than a third of what was predicted. (ht tps://www.bettertransport.org.uk/files/admin/Problems_with_Private_Roads_FinalWeb.pdf) A recent study published, examined the problems faced by toll roads in the UK and the findings included some of the points listed below. There is a certain element of risk to investors that require large guarantees from the local council or government to make this type of investment attractive, thus making them vulnerable to political changes and pressure. Community opposition to the building of new roads is often seen and this could add further risk by increasing the timescale in getting project approval. Strong evidence suggests that forecasts for traffic on existing toll roads are over-optimistic worldwide and in the UK, as the M6 toll experience shows. Females tend to be more reluctant to change routes and low to medium income earners are more sensitive to tolls. (Lake, M. and Ferreira, L. (2002). Modelling tolls: values of time and elasticities of demand: a summary of evidence. ) If we were to look briefly at the tram proposal, the tram would result in a reduction in the number of car trips, compared to the no tram scenario. This would mean fewer parking spaces will be taken, and these benefits are likely to be focussed in the areas served by the tram and result in less traffic on the roads in these areas. (WEST LONDON TRAM: EALING COUNCIL BUSINESS CASE 2005) In the future, government might introduce traffic limitation measures, such as congestion charges and parking control charging. In this scenario the tram would provide an attractive alternative for those choosing to use their cars less. (HS2 Ltd, 2011, HS2 London to the West Midlands Appraisal of Sustainability, A report for the Department for Transport) Conclusion Any major project, like a motorway or tram network which affects millions of people has many factors besides the economic factor that have to be taken into account. It has been observed that noise pollution, particularly air pollution, damages peoples health. The publics adverse reaction to certain projects might jeopardise governments chances of re-election. The proposed projectss pros and cons has to be evaluated. Social, environmental and political factors are very important. Sometimes a non-financial factor could influence a company into accepting a project with a lesser return for a better image, this is the opportunity cost. If the environmental and non-financial factors were more important to the City Council then Project 1 would be the better option. It is still making a profit and would cost pound;8,000,000 less to invest in. My recommendation though, to Coventry City Council, based on the results from the four appraisal techniques would be to invest in Project 2. That would be the correct decision if financial factors are the only motivation.